On August 6, 2021, Canada Infrastructure Bank (CIB) completed initial investments in relation to the zero-emission buses (ZEB) initiative.
CIB has a long-term target to invest $5 billion in public transit, including at least $1.5 billion over the next three years specifically for ZEBs – a safe, sustainable, environmentally friendly alternative to diesel buses. Zero-emission electric transit and school buses are expected to save approximately 100 and 20 tonnes of greenhouse gases, respectively. To date, CIB has agreed to support the purchase of new ZEBs in such cities as Brampton and Ottawa, Ontario and Edmonton, Alberta, as well as in the provinces of British Columbia and Québec, and has approved investments for the purchase of more than 5,300 zero-emission public transit and school buses.
This first of its kind program offers flexible financing to accelerate integration of ZEBs into fleets. Bus Owners can access the financing on favourable and flexible terms, in the form of direct loans, to cover the higher upfront capital costs of ZEBs, and repayment of the loans is based on actual savings generated by the lower cost of operating ZEBs. The program required an innovative approach to municipalities, transit agencies and school boards, and how they can borrow. This approach changed mind-sets from a grant mentality to a credit mentality, all within the context of meeting environmental goals and commitments at multiple levels of government.
Davies Ward Philips & Vineberg LLP acted for Canada Infrastructure Bank in its development of this first of its kind financing program, with a team that included Gregory Southam (Infrastructure), Carol Pennycook (Project Finance), Dale Osadchuk (Government Regulation), Elisa Kearney (Trade Law), and Sarah Powell (Environment).