More than $43.6 billion in public funds will flow to Volkswagen, Stellantis-LGES and Northvolt factories to produce batteries for electric vehicles, according to the Parliamentary Budget Officer (DPB), who estimates that this will be “a good 5, “$8 billion more than expected.”
“We estimate that the total cost of government support to Northvolt, Volkswagen and Stellantis-LGES for electric vehicle battery production in the period 2022-2023 to 2032-2033 will be $43.6 billion, an increase of $5.8 billion US dollars compared to the announced costs corresponds to 37.7 billion US dollars,” calculates the Parliamentary Budget Officer (DPB) in a study published on Friday.
Of that $43.6 billion, the PBO estimates that $26.9 billion (62%) of the cost will be borne by Ottawa and $16.7 billion (38%) by Ontario and Quebec.
Northvolt in 11 years
The PBO states that this estimate is contingent on “the continuation of the U.S. Advanced Manufacturing Production Credit (AMPC) (through the end of 2032) and compliance with electric vehicle battery production schedules provided by Northvolt, Volkswagen and Stellantis-LGES.”
As for Northvolt, the PBO claims that the breakeven point on $4.6 billion in production subsidies will be reached in 11 years, not 9 years as stated by the federal government.