Driven in large part by the convenience of online shopping and the expectation of same-day delivery, Canada’s cities are experiencing a rise in commercial vans and trucks. A less visible cost of this convenience is increased air pollution: particulate matter emitted by these mostly diesel vehicles causes respiratory illnesses and premature death. This pollution is worst in cities and along major traffic corridors.
With the number of medium and heavy-duty vehicles (MHDVs) expected to rise significantly, there’s a pressing need to electrify them. That’s where government policy and the auto sector come in. Canada has manufacturing capabilities and supply chains that can put us in the front seat of sector-wide electrification. The transition to electric MHDVs presents a multi-billion opportunity for governments, businesses, and investors that will also support national emission reduction targets and electrification goals.
The manufacturing ecosystem for electric MHDVs is growing
Examples of automakers meeting this moment include Isuzu’s all-electric low-cab forward truck, and Ford and Rizon’s Class 4 and Class 5 electric trucks.
EV battery start-ups and cross-industry collaborations, such as Daimler Truck’s investment into start-up ProLogium to advance solid state technology, are accelerating innovation and overcoming longstanding technological challenges, including range limitations for long-haul trucks. EV batteries are rapidly evolving—becoming lighter, longer-lasting, and faster-charging—improving the feasibility of electric MHDVs. Battery manufacturers, such as China’s CATL, are driving advancements with cobalt-free and long-life batteries suitable for buses and trucks. Meanwhile, domestic startups have a promising outlook and would benefit from targeted investment to scale and commercialize.
Incentives will help accelerate investment in electrifying fleets
The actions taken by various governments to advance electric MHDVs demonstrate a commitment to economy-wide electrification, providing strong tailwinds for investment.
Globally, Canada can look to California’s efficient ‘single window’ permitting, Europe’s mandated MHDV charging network and AFIR standardization, and China’s state-backed battery-swapping solutions for best practices.
Provincially, Quebec’s Bill 81’s credit system is incentivizing electric heavy-duty truck sales, while here in Ontario, standardized EV charger connection procedures are making it easier to build EV charging stations. Incentives like Transport Canada’s iMHZEV program and zero-emission truck weight allowances are supporting the fleet transition in BC.
Building a charging network for cargo fleets is primed for partnerships and investment
Canada will need a network of high-power public charging stations to support a fleet of electric commercial vans and trucks. The sector is trying to catch up: a long-haul EV trucking charging network is being evaluated for an 835 km stretch of highway between Windsor, Ontario and Quebec City, one of the busiest freight corridors in Canada.
To meet demand, joint ventures and public-private partnerships will be crucial. Europe is already seeing large-scale collaborations, such as the Volvo Trucks, Daimler Truck, and Traton Group investment in heavy-duty charging infrastructure. Similar partnerships in Canada could accelerate deployment and create lucrative opportunities for investors in the growing EV charging sector.
According to a Natural Resources Canada (NRCan) report, $47 billion in capital investments is needed by 2040 to support electric MHDV public charging infrastructure from equipment to installation to grid upgrades. Fleet depot charging alone requires 1.1 million new ports by 2040.
Electricity grid upgrades create more value streams
The rapid scaling of Canada’s charging infrastructure will also require significant electrical grid upgrades to ensure affordable, fast, and reliable heavy vehicle charging. Several companies, however, are exploring innovative solutions to offset the impact of electric MDHVs on the grid.
Start-ups are exploring innovative charging solutions that can be rapidly deployed across urban, rural, and industrial areas while enhancing the efficiency, cost-effectiveness, and sustainability of electric fleets.
For example, U.S.-based Resilient Power created “ultra-compact” fast-charging stations that combine a transformer, charger, and battery storage into one small unit, allowing for high-power charging in small depot spaces. In Europe, Heliox and ChargePoint EU rolled out high-power charging stations for electric bus fleets, ensuring reliable overnight and opportunity charging. In Canada, Jule offers EV charging and battery storage systems, specializing in DC fast charging technology, ensuring a quick charge even in areas with limited grid infrastructure.
Battery energy storage systems (BESS) are being explored in Canada to charge bus fleets. BESS charges slowly from the grid throughout the day and then serves as the source of high-power charging during peak demand times, flattening load curves and providing value to local utilities.
Bi-directional charging is another critical area of innovation. The City of Vancouver launched a first-of-its-kind project to test bi-directional charging (V2G) with municipal buses and trucks, turning fleet vehicles into energy assets that can supply power to the grid during peak hours. Bidirectional charging technology not only generates monetary returns but also supports a smarter, cleaner, and more reliable electricity grid.
Investors looking at this space can capitalize on the intersection of clean energy, transportation, and smart grid technology, making it a high-growth sector with strong long-term potential.
Fleet operators are critical to support in this transition
Knowledge gaps around operational needs, charging logistics and maintenance, plus high upfront costs for electric buses, trucks, and charging stations, as well as concerns about new technology all impede a fleet operator’s ability to plan and execute this transition, despite the benefits.
Recently, TAF made a $1,000,000 investment in 7Gen, a Canadian company that offers a turnkey service for fleet owners, including customer service from start-to-finish, as well as financing and procurement support of electric commercial vans and trucks and vehicle charging facilities, to get fleets efficient and electrified.
Companies like 7Gen are well-positioned to capitalize on the growing demand for electric MHDVs because they offer a critical value proposition—making the transition to EVs more accessible and cost-effective—while supporting overall market growth.
Investors and entrepreneurs can expect growing business opportunities and deep impact
Widespread adoption of electric MHDVs depends on advancements in technology, robust charging infrastructure, upgrades to the electric grid, and government policies that promote market certainty and the development of a reliable supply chain. Investors who get in now will play a crucial role in the market by providing the upfront capital necessary to support sector innovation and the rapid scaling of infrastructure.
We can keep people and goods moving and essential services running while also enjoying cleaner air, lower carbon emissions, and a thriving industry to go with it.
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