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Kelley Blue Book Canada’s Guide to Electric Vehicle Rebates

With more electric vehicles entering the new car market each year, buyers can take advantage of government purchase incentives.


By John LeBlanc, Editor, KBB.ca

Electric vehicles are all over the news. Whether it's the latest from Tesla to start-ups like Lucid to the continuous stream of new product announcements and launches from traditional automakers looking to enter showrooms sooner than later (like the recent reveal of the 2022 Ford F-150 Lighting electric pickup truck) electric vehicles are a hot topic. According to data from DesRosiers Automotive Consultants Inc., sales of zero-emission vehicles (ZEVs)—that include gasoline-electric plug-in hybrid electric vehicles (PHEVs) and all-electric battery electric vehicles (BEVs)—have been increasing across Canada in the past few years. With a nominal market share in 2011, ZEVs now make up 3.52% of new vehicle sales, up from less than one percent in 20161. 

Whether it's General Motors setting a goal of making the vast majority of its vehicles it produces electric by 2035 or Honda planning to phase out all gasoline-powered vehicles in North America by 2040, it appears as if electrified vehicles are here to stay.

“It is abundantly clear to our team at Kelley Blue Book that the future of automotive is certainly a battery-powered one. The various Provincial and Federal incentive programs are a key contributor to encourage more consumers to take the step and invest in an electrified vehicle,” said Brian Murphy, Managing Director of Kelley Blue Book in Canada.

Federal and Provincial Rebates Ease ZEV Premium Prices

With all this excitement and momentum in ZEVs, many car buyers are becoming interested in the idea of switching from gasoline to electric. As sales increase and ZEVs are adopted more widely, the auto industry is counting on the premium prices today’s ZEVs warrant coming down and being more in line with the costs of internal combustion engine (ICE) vehicles. But until then, ZEV sales are highly dependent on government financial incentives.

In Canada, new ZEV shoppers can take advantage of both federal and provincial purchase incentives. Only three provinces currently offer incentives: British Columbia, Québec, and Prince Edward Island, which only started their program this year. 

It’s no surprise that ZEV sales in B.C. and Québec account for 76% of all ZEV light vehicle registrations in the country1. Proof that these incentives work, Ontario saw a decline in ZEV market share from 2.05% in 2018 to 1.23% in 2019 as provincial incentives were removed1, and ZEV market share has yet to recover, sitting at 1.75% for 20201.

At the federal level, Transport Canada's iZEV program provides rebates of up to $5,000 (all prices in Canadian dollars) for those who buy or lease an eligible ZEV and up to $2,500 for a plug-in hybrid. To qualify, the Manufacturer's Suggested Retail Price (MSRP) for a vehicle with six seats or fewer has to be less than $45,000. 

In addition, Transport Canada’s ZEV incentive can be applied to any provincial incentive offered.

In B.C., the CleanBC Go Electric light-duty ZEV rebate program provides rebates of up to $3,000 for the purchase or lease of a new BEV, hydrogen fuel cell vehicle, or longer-range PHEV, and $1,500 for the purchase or lease of a shorter-range PHEV. Any ZEV with an MSRP above $55,000 is not eligible for a vehicle rebate.

The Québec provincial government’s ZEV rebate program offers a rebate of up to $8,000 on the purchase or lease of eligible new vehicles. The rebate amount depends on the type of vehicle and conditions, such as the vehicle’s selling price, electric battery capacity, model year, or year of purchase.

Joining B.C. and Ontario for 2021 is Prince Edward Island. The province's new Universal Electric Vehicle Incentive program is unique. Its $5,000 for pure-electric vehicles and $2,500 for plug-in hybrid rebates can be applied to both new and used ZEVs.

Additional ZEV Information and Advice

In addition to the information laid out above, to further help new car buyers with the decision to purchase a ZEV, Kelley Blue Book Canada has created several articles with consumer advice, vehicle reviews, and information about ZEVs to help shoppers navigate the evolving ZEV landscape:


Could the Right Electric Car for You be a Plug-in Hybrid?

The Pros and Cons of Buying a New EV During the COVID-19 Pandemic

Pickup Trucks Are Going Electric

10 New Battery Electric Vehicles Coming for 2022

First Look 2022 Ford F-150 Lightning

First Look 2022 Mercedes-Benz EQA

First Look: 2024 GMC Hummer SUV

First Look: Lexus LF-Z Electrified Concept

First Look 2022 Audi e-tron GT quattro

First Look 2022 Hyundai Ioniq 5

First Look 2022 Chevrolet Bolt EV and EUV

Dear Kelley Blue Book: Small Electric Vehicles

Sibling rivalry: 2020 Kia Niro EV vs. 2021 Kia Soul EV

Sibling rivalry: 2021 Toyota RAV4 Hybrid vs. 2021 Toyota Venza Hybrid

Comparison: 2021 Ford Explorer Hybrid vs. 2021 Toyota Highlander Hybrid


1Source: DesRosiers Automotive Consultants Inc.


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