An electric vehicle battery supply chain in Canada could add $48.2 billion annually to the country’s economy and create up to 250,000 jobs by 2030, according to a new report, which calls for a comprehensive government strategy ranging from resource exploration to battery recycling.
Clean Energy Canada and the Trillium Network for Advanced Manufacturing point to a “booming” market for batteries, citing the International Energy Agency’s call for electric vehicles to make up 35 percent of the global auto market by 2030, up from 9 percent in 2021.
“A Canadian EV battery supply chain isn’t just a good-sounding idea. It’s a very real, very big economic opportunity with potential winners across Canada and across all industries,” the report said.
According to Bloomberg NEF, Canada ranks fifth in the world in terms of battery supply potential, behind China, the US, Germany and Sweden.
This $48.2 billion annual GDP contribution is the report’s most ambitious scenario. It requires almost all of Canada’s automotive assembly capacity to be dedicated to electric vehicles. New mines, new investments in battery materials, cathode production and recycling would be required.
Canada would also need to attract another large and two smaller battery cell plants. The country landed its first battery Gigafactory in March, when automaker Stellantis and South Korean battery giant LG Energy Solution announced plans to invest $5 billion to open a new electric vehicle battery manufacturing facility in Windsor, Ontario.
Additionally, light truck sales would need to reach a 90 percent zero emissions target by 2030, with the US meeting its 50 percent target. Also, medium-duty and heavy-duty truck sales in Canada and the US should be 35 percent and 23 percent, respectively.
“While that sounds like a tall order, it is not unrealistic,” the report’s authors wrote. “The decisions Canada makes over the next seven years will determine what outcome we achieve.”
In July, Prime Minister Justin Trudeau said Canada was making a “big bet” on becoming a major player in the global electric vehicle supply chain. His comments followed news that Belgian metals refiner Umicore SA will build a $1.5 billion facility near Kingston, Ontario.
Two weeks later, Canada scored a major victory when US lawmakers allowed Canadian-made electric vehicles to qualify for a consumer tax credit. The original bill, a key part of US President Joe Biden’s climate agenda, previously limited loans to vehicles made by unionized automakers in the US
The report recommends Canada to double down on “some key stages” in the battery supply chain in the near future, such as: B. the assembly of electric vehicles, the manufacture of battery cells and the production of clean battery materials.
Canada’s 2022 federal budget earmarks $3.8 billion to advance the government’s critical minerals strategy. Ontario, Quebec, Alberta, and Newfoundland and Labrador have each implemented critical mineral strategies that prioritize minerals for EV batteries.
Barring additional government action, the report concludes that Canada’s battery supply chain will create 60,000 jobs by 2030 and contribute $12 billion to the country’s GDP annually.
Jeff Lagerquist is Senior Reporter at Yahoo Finance Canada. Follow him on Twitter @jefflagerquist.
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