OTTAWA — A report from the Parliamentary Budget Officer says the total cost of provincial and federal support for electric vehicle battery manufacturing in Canada will be $5.8 billion more than government projections.
The report analyzes the costs to governments of recent deals struck with Northvolt, Volkswagen and Stellantis-LGES to locate EV battery manufacturing facilities in Canada.
It pegs the total cost of government support at $43.6 billion between 2022 and 2033, which is $5.8 billion higher than the $37.7 billion in costs announced by Ottawa and the provinces.
The report says the extra $5.8 billion represents foregone corporate income tax revenues for the federal, Ontario and Quebec governments.
Of the total $43.6 billion in costs, 62 per cent will be borne by the federal government and 38 per cent will fall on the governments of Ontario and Quebec.
The report also estimates a break-even timeline for governments of 11 years for the Northvolt production subsidy, 15 years for the Volkswagen subsidy and 23 years for the Stellantis subsidy.
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