Oil & Gas Product News Logo

Energy demands across Canada to change with near-term growth of electric vehicles

New EY research outlines impact of rapid, moderate or slow EV adoption in Canada

"Electric vehicles have the potential to profoundly reshape everything from local transit to global commerce, and Canada's energy players are not going to be immune from this impact," says Lance Mortlock, EY Canada Oil & Gas Leader.
"Electric vehicles have the potential to profoundly reshape everything from local transit to global commerce, and Canada's energy players are not going to be immune from this impact," says Lance Mortlock, EY Canada Oil & Gas Leader.

Electric vehicles (EVs) are increasingly turning the heads of Canadian consumers and energy company executives, and new EY research shows that rapid adoption could mean as many as 13.2 million EVs on the road by 2030.  

The EY Canadian electric vehicle transition — the difference between evolution and revolution report outlines how all EV adoption scenarios — rapid, moderate or slow — will have an important impact on Canadian Oil & Gas (O&G) and Power & Utilities (P&U) companies in the years ahead. Already, Canada is the 10th fastest adopter of EVs in the world, with sales growing 165% year-over-year in 2018.  

"Electric vehicles have the potential to profoundly reshape everything from local transit to global commerce, and Canada's energy players are not going to be immune from this impact," says Lance Mortlock, EY Canada Oil & Gas Leader. "Companies should be asking themselves not only how quickly EV adoption will unfold, but also whether they're taking the right strategic steps to prepare for this momentous shift. Now is the time to invest in future-proofing."

EY research finds that rapid adoption — with EVs representing 30% of Canada's vehicle stock, compared to less than 3% today — would reduce domestic oil consumption by roughly 252k barrels per day and could trigger convergence of O&G and P&U companies in the marketplace.

"Diversifying portfolios will be crucial for oil and gas companies in a rapid-adoption future," says Mortlock. "To stay relevant and ensure profitable revenue streams, they'll need to invest more in clean energy, petrochemical products and access to tidewater to enter new markets."

Rapid adoption could also cause an 11% spike in Canadian electricity demand, requiring utilities to make significant investments in existing grid infrastructure to allow consumers to charge cars at home and in public spaces. Distribution network upgrades would also be required to improve power transmission across the country, including to rural areas.

"A dramatic increase in electricity demand would likely result in new power and utilities players coming to market," says Daniela Carcasole, EY Canada Power & Utilities Leader. "This could open up a number of collaboration opportunities for existing companies — either through M&A or joint ventures with hotels, restaurants, technology companies and retail stores to offer easy and convenient vehicle charging to consumers."

Availability of charging infrastructure, price premiums, battery performance, subsidies and time to complete the charge remain key barriers deterring Canadians from purchasing an EV. But even a moderate adoption scenario — with 6.5 million EVs on Canadian roads by 2030 — would require a 5.5% increase in electricity demand.

"Growing electric vehicle adoption is inevitable," says Carcasole. "By proactively developing strategic plans that position them strongly for the future, companies can avoid analysis paralysis and turn the challenges of this market inflection point into a significant opportunity."

Company info

222 Bay Street
Toronto-Dominion Centre
Toronto, ON
CA, M5K 1J7

Website:
ey.com

Read more

More from Industry News

Strategic alliance with Microsoft accelerates Suncor's digital transformation

Suncor has announced a multi-year strategic alliance with Microsoft Canada as a part of the company's effort to further accelerate its digital transformation journey. Suncor has selected Microsoft as its strategic cloud provider, tapping into the full range of Microsoft's cloud solutions to empower a connected and collaborative workforce, upgrade data centres, and increase analytics capabilities. Suncor will also collaborate with Microsoft on innovation projects, drawing on expertise and opportunities from both organizations.

Subscribe to our free newsletter

Get our newsletter

Learn more

Q3 brings good financial and operating performance for Cenovus

Cenovus Energy Inc. continued to deliver on its commitments to shareholders in the third quarter of 2019. The company generated free funds flow of $622 million while maintaining its industry-leading low cost structure and meeting mandatory production curtailment levels set by the Government of Alberta. Other third-quarter highlights include:

  • Adjusted funds flow of $916 million; cash from operating activities of $834 million
  • Oil sands operating costs of $6.90 per barrel (bbl), 21% lower than in the second quarter of 2019 and 24% lower than in the first quarter
  • Net earnings from continuing operations of $187 million versus a net loss a year prior
  • An 11% year-over-year increase in realized crude oil sales prices to an average of $55.13/bbl driven by higher U.S. sales and narrower differentials
  • A further reduction in net debt to $6.8 billion with net debt to adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) decreasing to 1.9 times
  • Crude-by-rail volumes of more than 80,000 barrels per day (bbls/d) in September
Subscribe to our free magazine

Get Our Magazine

Paper or Digital delivered monthly to you

Subscribe or Renew Learn more

Driving natural gas innovation with $50 million in funding opportunities

Emissions Reduction Alberta's (ERA) new $50 million Natural Gas Challenge will unlock innovation across Alberta's natural gas value chain, from production to market and all points in between. It supports clean technology projects that reduce greenhouse gas (GHG) emissions and improve the competitiveness of the natural gas industry.

Alberta company generating RNG from forest residue meets key milestone

An innovative clean energy start-up company, G4 Insights Inc., has successfully demonstrated in a field trial that forestry industry residues can be turned into renewable natural gas (RNG). Their RNG technology demonstration project has been supported by a federal-provincial-industry partnership with the common goal of clean energy distribution into homes, businesses and industry connected to the natural gas infrastructure system.

Vancouver landfill now approved to produce renewable natural gas

FortisBC and the City of Vancouver have received regulatory approval from the British Columbia Utilities Commission to produce Renewable Natural Gas (RNG) at the City's landfill in Delta. This project aligns with the City's and FortisBC's shared commitment to develop more renewable energy and support the broader greenhouse gas (GHG) reduction goals outlined in the province's CleanBC strategy.

Subscribe to our free newsletter

Get our newsletter

Learn more

Liberals must build Trans Mountain Expansion to fulfill promises and benefit Canadians: Canada Action

He's endorsed it, campaigned in favour of it and even arranged for taxpayers to purchase it. Now newly re-elected Prime Minister Justin Trudeau has to move quickly to build the long-delayed Trans Mountain Pipeline expansion project (TMX), says a non-partisan grassroots group that advocates for the energy and natural resources economy.

Investment firms to acquire AltaGas for $1.7 billion

AltaGas Canada Inc., the Public Sector Pension Investment Board, and the Alberta Teachers' Retirement Fund Board announced that PSP Investments and ATRF and ACI have concluded a definitive arrangement agreement whereby the Consortium will indirectly acquire all of the issued and outstanding common shares of ACI  in an all-cash transaction for $33.50 per Common Share.

Hybrid cloud infrastructure target of Schneider Electric and NetApp collaboration

Schneider Electric has announced a collaboration with NetApp to deliver the pre-validated Optimized Edge for NetApp HCI solution, which is built on NetApp's hyperconverged infrastructure (HCI) platform and designed for enterprise, remote/branch offices, and small- to medium-sized business (SMB) spaces. Optimized Edge for NetApp HCI combines edge computing infrastructure with an open and scalable on-premise hybrid cloud infrastructure to revolutionize the private cloud into a deployable region of customers' multi-cloud. The solution is a compatible physical infrastructure solution that is integrated, pre-engineered, and pre-validated to help organizations of all sizes reduce deployment time, accelerate time to market, and minimize on-site and remote management.

Caterpillar Oil and Gas introduces HMI panel for gas compression products

Caterpillar Oil & Gas is pleased to announce the next generation of human-machine interface (HMI) panels available as an integrated component on select gas compression models. The easy to use touchscreen display performs the functions of the customer version of Cat Electronic Technician. Now, with the HMI panel integration, controlling the engine and monitoring the system's status is at the users' fingertips. The new HMI panel is now available on the CG137-8 and will be released as an offering for additional gas compression models at a later date.

Subscribe to our free magazine

Get Our Magazine

Paper or Digital delivered monthly to you

Subscribe or Renew Learn more