No more funds: Canada pauses incentive programme for EVs

Customers who have already ordered their electric vehicle and whose application to the iZEV programme was pre-approved will still receive the incentive. All others will have to pay full price for their vehicle – or push back their purchase or lease.

It is also important to note that the Canadian government continues to speak of a pause. It is not clear when or if the incentive programme will continue. However, this is likely not the end of funding for electric vehicles. “Any updates to the Program will be posted on the Transport Canada website, and all authorised dealers and sellers enrolled in the Program will be notified,” Transport Canada writes in its frequently asked questions in response to “How long is the Program pause expected to last?”

The programme “officially paused on January 12, 2025, as the allocated funds were fully committed,” the Canadian transport ministry specifies. It also says that more than 546,000 electric vehicles have been partially funded through the programme since it kicked off in 2019 – so it is selling the pause due to lack of additional funding as a success.

“I am delighted to see the success of the iZEV Program,” Anita Anand, Canada’s Miniter of Transport and Internal Trade, commented. “Since 2015, our Government has been committed to building a greener economy and combatting climate change. We will continue to engage with industry, environmental groups, and across jurisdictions to foster collaboration in decarbonising the country’s transportation sector and becoming a global leader in zero-emission vehicles.”

Canada’s iZEV programme incentivised new electric vehicles and plug-in hybrids (bought or leased) with up to 5,000 Canadian dollars (about 3,400 euros). The Toyota Mirai also made the list of eligible cars as the only fuel-cell vehicle. Moreover, there are 122 eligible PHEVs and 149 eligible BEVs on that list – however, that includes all eligible variants of the same model.

On top of being new (pre-owned vehicles were not eligible for the incentive), passenger cars had to have a Manufacturer’s Suggested Retail Price (MSRP) of less than 55,000 CAD. Station wagons, pickup trucks, SUVs, minivans, vans and special purpose vehicles could have a price tag of up to  $60,000.

According to Transport Canada, the subsidy scheme helped Canada reach a ZEV market share of 14.2 per cent in the first three quarters of 2024 – up from 11.7 per cent for the whole of 2023.

Medium- and heavy-duty zero-emission vehicles are not affected by the pause, as they are incentivised through a different programme called Incentives for Medium- and Heavy-Duty Zero-Emission Vehicles (iMHZEV), first introduced in 2022 and not scheduled to conclude until March 2026. “The pause process specifically applies to the iZEV Program, and any changes or adjustments made during this period are exclusive to that program,” Transport Canada specifies.

canada.ca, tc.canada.ca (FAQs)