Ottawa on Thursday announced plans to create "made-in-Canada" fuel economy standards for cars and light trucks, noting they would be at least as stringent as regulations recently introduced in the U.S.

"We welcome the U.S. goal, but are committed to developing made-in-Canada standards that achieve — at minimum — that same target in Canada," Federal Transport Minister Lawrence Cannon said at a press conference at the Montreal International Auto Show.

Federal Transport Minister Lawrence Cannon announced plans to draft new fuel consumption standards that would require model year 2011 cars to meet an average of 6.7 litres per 100 km.
(CBC)

Cannon said that during the 60-day consultation period, the federal government will meet with stakeholders in the auto industry, environmental groups and the provinces and territories. The standards will apply beginning with 2011 model year vehicles.

In December, U.S. President George W. Bush approved a law requiring automakers to increase the average fuel economy of their entire fleets by 40 per cent by 2020. Under the new legislation, motor vehicles would be required to meet an average 35 miles per U.S. gallon (6.7 L/100 km) within 12 years.

Cannon said by 2020, the average new vehicle sold in Canada will offer better fuel consumption than some hybrid cars on the road today. He also noted the cars will spew out fewer greenhouse gas emissions than about 93 per cent of all vehicles listed in the 2008 Fuel Consumption Guide.

Transport Canada said the current combined average for new cars and light trucks was approximately 8.6 L/100 km (27 miles per gallon) in Canada.

Quebec Premier Jean Charest applauded the initiative but also noted setting fuel efficiency standards alone doesn't go far enough. Quebec and British Columbia hope to follow California's lead in attempting to set fuel economy standards that are more stringent than federal rules. California is currently in a legal dispute with the U.S. Environmental Protection Agency over jurisdiction to set a separate standard.

Charest said Canada should aim to match California's emission standards, which directly target greenhouse gas from vehicles.

"The transport sector is the main contributor," he said. "And that's about cars."

Sierra Club says delay will prove costly to Canada

The Sierra Club criticized the announcement, saying the regulations aren't being phased in quickly enough. The environmental group said the delay will cause both damage to the environment and cost consumers billions of dollars at the pumps.

Meanwhile, environmental groups have lambasted the U.S. plan as not going far enough toward other international standards aimed at fighting climate change and greenhouse gas emissions.

They say the law also fails to set intermediate requirements for automakers, which would give industry plenty of opportunity to lobby against the 2020 target.

The new standards could also raise the price of vehicles, said David Adams, president of the Association of International Auto Manufacturers of Canada.

"I think we're looking at technologies over and above what exists in the marketplace today," Adams said.

"As with everything else, when you're introducing new technology … there is a cost associated with that."

The U.S. law came into play this week in the presidential campaign, as former Massachusetts governor Mitt Romney pledged before the Michigan primary that he would ease emissions restrictions on the auto industry if elected to the White House.

With files from the Associated Press