Ontario could help its auto industry capitalize on growing electric school bus demand

Ontario’s auto sector has a chance to cash in on North America’s growing market for electric buses and electrifying the province’s school buses is a strong place to start, say Pembina Institute analysts.

The benefits of swapping out fossil fuel-fuelled school buses for electric buses are many. It reduces the air pollution kids are exposed to and cuts the amount of planet-warming greenhouse gases entering the atmosphere. Parents have been advocating for a faster transition to electric buses, so their children won’t breathe in harmful diesel fumes on their way to and from school every day.

But there is also a clear economic upside to investing in electric school buses, especially for Ontario, according to a report by the Pembina Institute.

The province’s heavy truck and bus industry “practically collapsed” after the 2008 financial crisis, and the sector is still operating at only 10 per cent of its pre-2008 production levels, the report’s authors write.

The electric bus market is growing: global sales are projected to reach US$3.1 billion by 2030 and North America’s electric bus market is predicted to nearly double within the next three years.

“The province already has the infrastructure and labour force needed to respond to the rapid growth we’re seeing in the electric vehicle marketplace,” said Chandan Bhardwaj, report author and senior transportation analyst with Pembina Institute, in a news release.

Ontario could revive its heavy-duty vehicle industry by investing in the production of electric school buses and offering school districts grants to help purchase electric buses, according to the report. School buses are one of the easiest type of larger vehicles to switch to electric and if the provincial government encouraged electric school bus uptake, it would be simultaneously making progress on reducing planet-warming emissions, Bhardwaj pointed out.

The transportation sector is responsible for 32 per cent of Ontario’s greenhouse gas emissions – the most of any sector.

Ontario also has the country’s largest fleet of school buses: of its more than 20,000 school buses and school-purpose vehicles, most run on fossil fuels, with 200 electric school buses expected to hit the road between 2022 and 2026. Each year, a diesel school bus emits about 27 tonnes of carbon dioxide or an equivalent amount of greenhouse gases, nearly all of which would be eliminated if it was replaced by an electric bus, according to the Pembina Institute. If Ontario’s whole school bus fleet was swapped to electric, the province would reduce annual emissions by about 540,000 tonnes.

“We are moving forward with several initiatives to support the uptake of electric vehicles across the province through recent investments in EV manufacturing and supporting EV charging deployment,” reads an emailed statement Ontario’s Ministry of Transportation sent Canada’s National Observer. The statement pointed to a $91-million investment announced in March 2022 to support the installation of public EV chargers outside Ontario’s large urban centres. Pembina Institute wants to see quadruple that amount to bolster charging infrastructure.

“Our government is exploring strategies to support the electrification of medium- and heavy-duty vehicles – and we recognize that transitioning school bus fleets to electric can help our children travel to school in a sustainable way,” reads the statement.

Canada typically produces about five per cent of global heavy-duty vehicles, but only contributed 0.1 per cent to global heavy-duty EV production in 2018, according to the report. A lot of Canada’s medium- and heavy-duty EV production happens in Quebec. Lion Electric and Nova Bus are two Canadian companies in Quebec, along with New Flyer in Manitoba and GreenPower in B.C.

The federal government’s objective is to help put 5,000 zero-emission public transit and school buses on the roads by 2026. Quebec plans to electrify 65 per cent of its school bus fleet by 2030. In April 2021, the province announced a $250-million investment for nearly 2,600 electric school buses over the next three years, according to Quebec Transport Minister Francois Bonnardel.

In February 2022, Prince Edward Island Premier Dennis King said the province would transition its school bus fleet to electric vehicles “over the next few years.” Currently, 82 buses out of the 322-vehicle fleet are electric.

In 2018, Ontario’s newly elected Progressive Conservative government cancelled the province’s electric school bus pilot program. The program had offered up to $400,000 for each new bus and charging infrastructure and was cancelled at the same time as Ontario scrapped its carbon cap-and-trade program.

Last summer, Ontario announced a $5-million program to train 500 young workers for jobs in the automotive industry. The Pembina Institute’s report calls for Ontario to revive this training opportunity, which has since ended, and train even more people to prepare for growth in electric vehicle manufacturing.
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Natasha Bulowski, Local Journalism Initiative Reporter, CANADA’S NATIONAL OBSERVER