How Stringent Should Vehicle Emission Standards Be? Simulating Impacts on Greenhouse Gas Emissions, Zero-Emissions Vehicle Sales, and Cost-Effectiveness.

This article analyzes the impacts of varying vehicle emission standards (VES) stringencies on greenhouse gas (GHG) emissions, zero-emissions vehicle (ZEV) sales, and cost-effectiveness in Canada through 2030. Using the AUtomaker–consumer Model (AUM), which simulates endogenous consumer and automaker decisions alongside technological change, the study compares scenarios aligned with U.S. policies (Trump, Obama, Biden, California-style) and a more stringent European Union (EU)-style VES. Results indicate that while Biden-era standards outperform other North American designs, only the EU-like VES achieves substantial progress toward Canada’s 2030 GHG reduction and ZEV sales goals, though still falling short of the 60% ZEV sales target. The EU-style VES is also found to be approximately 13% more cost-effective ($/tonne CO2 abated) than other scenarios, supporting the case for adopting more stringent standards akin to the EU’s. The study highlights key sensitivities including consumer preferences, battery costs, and charging infrastructure availability, and suggests that complementary policies targeting behavior and technology adoption may be necessary to meet national climate objectives.