New Canadian Transit Fund Aligns Housing & Mobility, Retires Flawed Hydrogen Push

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Canada has taken a serious step ahead in its strategy to public transit funding. The brand new Canada Public Transit Fund, introduced final yr and going into impact in 2026, replaces the Zero Emission Transit Fund with a everlasting, predictable framework that may form investments for many years. As an alternative of short-term envelopes that expire, the federal government has dedicated to about $30 billion over the primary 10 years and $3 billion yearly on an ongoing foundation beginning in 2026. That scale and predictability enable businesses to plan with confidence somewhat than questioning if the cash will dry up earlier than their fleet renewal schedules come into alignment.

The issue with the Zero Emission Transit Fund was not its intent. It bought businesses shifting towards planning for electrical buses and funding the primary waves of purchases. An enormous downside was that it was momentary, software pushed, and narrowly scoped. Companies might safe funding for feasibility research — and this was one other large downside with the ZETF — depot modifications, or bus orders, however they might not rely on a gradual stream of assist throughout a long-term transition plan. That saved procurement piecemeal, and it made it tougher for producers and integrators to rely on constant Canadian demand. The brand new program fixes this by embedding transit capital into the core of federal infrastructure funding, with baseline allocations that businesses can depend on and focused requires aggressive initiatives that advance particular nationwide priorities.

The construction of the brand new fund is price pausing on. There are baseline allocations to areas that ship predictable quantities yearly. There are focused requires proposals on particular points like lively transportation or electrification. There are Metro-Area Agreements that require built-in planning throughout transit, land use, and housing, together with Built-in Regional Plans that knit these items collectively. And importantly, non-capital initiatives like planning and feasibility stay eligible, with as much as 80% of prices supported by federal {dollars}. That’s vital, as a result of it means businesses can nonetheless do the front-end work wanted to de-risk investments earlier than committing massive sums.

The brand new funding mannequin additionally aligns with the broader housing initiative that Mark Carney has put ahead, recognizing that transit and housing are inseparable elements of livable, low-carbon cities. In my work I’ve usually pointed to Singapore’s Housing Growth Board estates, the place no challenge proceeds with out being properly served by transit, one thing I found in my two years in that metropolis state a decade in the past. That alignment between the place folks dwell and the way they transfer is likely one of the causes Singapore prevented the car-dependent sprawl that burdens so many different nations.

By embedding Metro-Area Agreements and Built-in Regional Plans into the Canada Public Transit Fund, the federal authorities is taking a step in the identical course. It’s signaling that housing development have to be tied to dependable, clear, and inexpensive transit, and that public cash shouldn’t subsidize sprawl disconnected from mobility. This is a crucial shift that mirrors classes from Singapore and applies them to Canada’s personal urgent housing and local weather challenges.

The largest change for feasibility work is that it’s going to now not be tied to a single supplier. Below the Zero Emission Transit Fund, Infrastructure Canada designated CUTRIC because the nationwide planning service by a rushed and questionable procurement course of. That meant that businesses in search of the 80% subsidy for research needed to undergo CUTRIC. For years, this gave the group a sole-source function that excluded competitors. Whereas it gave some businesses entry to theoretically helpful modelling and state of affairs instruments they didn’t have in-house, it additionally created bias and opened the door to work that downplayed prices or overstated advantages for sure applied sciences. Most clearly, it created area for repeated claims that hydrogen buses had been a viable and cost-effective pathway when the overall value of possession numbers didn’t assist that place.

In reviewing CUTRIC’s physique of labor on transit decarbonization, each I and Michael Raynor discovered a constant sample of flawed assumptions and selective omissions that tilted outcomes closely towards hydrogen buses. Research repeatedly downplayed the complete infrastructure and fueling prices, utilized gas worth forecasts that bore little resemblance to market realities, and ignored the upper emissions that include hydrogen produced from pure gasoline in Canada’s present power combine. The worst case was Brampton’s CUTRIC research, sub-contracted largely to Deloitte as CUTRIC isn’t resourced for important engagements, the place there have been $1.5 billion out of a $9 billion value case skewed towards hydrogen, when a sensible evaluation would have discovered battery electrical bus fleets had been far cheaper.

Raynor’s impartial evaluation confirmed what I had been documenting: that these weren’t impartial feasibility assessments however biased eventualities constructed to maintain hydrogen in play. The consequence was to current metropolis councils and transit boards with numbers that regarded balanced on paper however would have led to increased long-term prices and worse local weather outcomes in observe.

In analyzing CUTRIC’s construction and governance, I discovered deep conflicts of curiosity that undermined the credibility of its research. The group’s board and membership included corporations with direct monetary stakes in hydrogen and pure gasoline, from utilities to tools suppliers, but it was concurrently producing supposedly neutral analyses meant to information public procurement selections. This overlap created a state of affairs the place the very corporations that stood to profit from hydrogen bus contracts had been shaping the assumptions and eventualities utilized in feasibility work. That battle went largely unacknowledged within the studies, leaving municipalities to imagine they had been receiving impartial recommendation when in actuality the evaluation was framed by vested pursuits.

I’m happy to say that in reviewing CUTRIC’s Board of Administrators for the up to date evaluation, the three organizations with massive conflicts of curiosity in favor of hydrogen buses — Enbridge, Ballard Energy and New Flyer — who had representatives on the Board now not have seats. I declare no duty for CUTRIC cleansing up its governance, however I’m happy to see this. They nonetheless have a membership construction which signifies that their highest paying members have an outsized weighting to organizations which is able to solely profit if hydrogen stays on the desk, so that they aren’t out of the woods from my perspective. Pure gasoline and hydrogen oriented organizations paying massive charges to affect a transit assume tank’s outcomes isn’t acceptable in 2025.

Below regular procurement governance in Canada, sole supply contracting is supposed to be the exception somewhat than the rule, reserved for circumstances the place no different certified supplier exists or the place an pressing want makes aggressive tendering impractical. The intent is to guard public funds by making certain competitors, transparency, and worth for cash.

CUTRIC’s designation because the unique supplier of federally backed feasibility research for zero emission buses bypassed that precept completely. It created a monopoly over a vital stage of decision-making, one that ought to have benefited from a spread of views and technical experience. By sidelining competitors, the federal government locked businesses right into a single supply of research that was later proven to comprise critical flaws and conflicts of curiosity. Additional, there was solely a single allowed supplier of hydrogen gas cell buses in Canada, New Flyer, and it had a seat on the Board and was paying the very best class of membership dues. One other sole supply battle on the highest stage. This not solely undermined the credibility of the outcomes but in addition eroded belief within the equity and accountability of federal transit funding.

In current public feedback, the top of CUTRIC sought to attribute this yr’s sluggish progress in battery electrical bus procurement to new tariffs, arguing that prices had turn into prohibitive beneath the commerce regime. However that declare overlooks the bigger concern: CUTRIC’s constant promotion of hydrogen as a comparable choice misled businesses for years and discouraged extra aggressive motion towards battery electrical fleets. Somewhat than tariffs being the primary brake, it was the flawed recommendation baked into CUTRIC-led feasibility work that clouded the enterprise case and delayed procurement selections. Now, with CUTRIC’s monopoly breaking down and extra sincere, unbiased feasibility work changing into doable, the actual offender — poor steerage favoring hydrogen — can now not conceal behind commerce arguments.

The brand new program’s silence on any mandated supply accomplice is a transparent signal that the door is now open to different organizations. Companies will be capable of select who they contract with for feasibility research, supplied procurement is clear and the work aligns with contribution agreements. That introduces competitors, which just about at all times improves high quality. It permits native businesses to work with consultants or establishments that perceive their grid combine, their depot constraints, and their housing development patterns. It additionally makes it tougher for anyone foyer to skew the evaluation.

Because the Zero Emission Transit Fund wound down, CUTRIC made a concerted effort to protect its privileged place by lobbying Ottawa to increase its function because the nationwide planning service into the brand new framework. In pre-budget submissions and public statements, the group argued that the feasibility program ought to be carried ahead beneath its stewardship, framing this as continuity somewhat than monopoly. The fact is that this was an try and lock in sole-source standing at the same time as proof of flawed research and conflicts of curiosity mounted. By in search of to embed itself completely within the new fund, CUTRIC was attempting to show what had been a brief administrative selection right into a structural function of federal transit coverage, one that may have continued to restrict competitors and skew planning away from the most effective options.

This variation issues for the talk about hydrogen buses. For a number of years, research produced by the outdated framework had been used to maintain hydrogen within the combine. The consequence was to current eventualities the place hydrogen regarded similar to battery electrical buses on paper, despite the fact that in observe it meant increased prices, increased emissions in most grids, and larger monetary danger. With open competitors for feasibility work, these sorts of distortions shall be simpler to problem. Companies could have the choice to rent impartial, competent organizations which might be targeted on actual numbers and actual operational constraints. The possible result’s that hydrogen bus proposals will turn into far much less widespread, and electrical buses powered by clear grids will transfer into the default place they already occupy in a lot of the world.

The everlasting nature of the brand new fund additionally solves one other downside. Producers and integrators want steady demand pipelines to put money into provide chains and workforce. When Canadian businesses order buses in small, irregular batches, suppliers can not rely on the quantity wanted to safe good pricing or to construct service capability. With baseline allocations in place, businesses can schedule regular procurement streams, and suppliers can plan accordingly. That can enhance pricing, cut back supply delays, and improve the resilience of Canada’s provide chain for zero emission buses and charging tools.

There’s additionally a equity aspect constructed into the design. Rural and small techniques are explicitly included. These are businesses that always couldn’t compete successfully in application-based packages in opposition to bigger city techniques. They now have a clearer path to planning assist and capital {dollars}. Faculty bus electrification will not be spelled out as immediately as beneath the Zero Emission Transit Fund, however provinces and native districts can nonetheless entry assist by the broader framework or by complementary packages.

The massive image is that Canada is maturing its strategy to transit decarbonization. As an alternative of treating electrification as a particular challenge window, it’s now a part of the everlasting infrastructure panorama. That indicators to businesses, suppliers, and utilities that the nation is critical in regards to the transition. It places an finish to the sole-source association that allowed one group to form too many research in a single course. And it offers room for extra competent and unbiased suppliers to ship the feasibility work that underpins good funding.

I believe it will result in CUTRIC being sidelined, and competent engineering consultancies like WSP and Stantec engaged as a substitute. Maybe that’s why Ballard Energy, Enbridge and New Flyer left the Board, as a result of it now not was now not going to be a sole sourced solution to push their most well-liked non-solution. One hopes that consultancies like Deloitte have discovered their lesson about their involvement in deeply flawed transit research with CUTRIC after the Brampton debacle was publicly torn aside by ex-Deloitte managing director Michael Raynor and me.

Canada’s transit techniques have wanted this certainty for a very long time. The brand new fund doesn’t resolve each downside, together with the absence of working assist, nevertheless it does create the monetary basis for electrical buses to scale in a means that’s constant, predictable, and regionally built-in. That’s the type of coverage infrastructure that makes actual change doable.