New research from EY shows that rapid adoption could mean as many as 13.2 million electric vehicles (EVs) on Canadian roads by 2030, a scenario the firm says will have an “important impact” on Canadian oil and gas and power and utilities companies in the years ahead.

The EY report, Canadian electric vehicle transition — the difference between evolution and revolution, outlines how all EV adoption scenarios — rapid, moderate or slow — could play out. Already, Canada is the 10th fastest adopter of EVs in the world, with sales growing 165 per cent year-over-year in 2018.

“Electric vehicles have the potential to profoundly reshape everything from local transit to global commerce, and Canada’s energy players are not going to be immune from this impact,” said Lance Mortlock, EY Canada oil and gas leader.

“Companies should be asking themselves not only how quickly EV adoption will unfold, but also whether they’re taking the right strategic steps to prepare for this momentous shift. Now is the time to invest in future-proofing.”

In the report, EY finds that rapid adoption — with EVs representing 30 per cent of Canada’s vehicle stock, compared to less than three per cent today — would reduce domestic oil consumption by roughly 252,000 bbls/d and could trigger convergence of oil and gas and power and utilities companies in the marketplace.

“Diversifying portfolios will be crucial for oil and gas companies in a rapid-adoption future,” Mortlock said. "To stay relevant and ensure profitable revenue streams, they'll need to invest more in clean energy, petrochemical products and access to tidewater to enter new markets.”

According to EY, rapid adoption could also cause an 11 per cent spike in Canadian electricity demand, requiring utilities to make significant investments in existing grid infrastructure to allow consumers to charge cars at home and in public spaces. Distribution network upgrades would also be required to improve power transmission across the country, including to rural areas.

“A dramatic increase in electricity demand would likely result in new power and utilities players coming to market,” said Daniela Carcasole, EY Canada power and utilities leader.

“This could open up a number of collaboration opportunities for existing companies — either through M&A or joint ventures with hotels, restaurants, technology companies and retail stores to offer easy and convenient vehicle charging to consumers.”

Availability of charging infrastructure, price premiums, battery performance, subsidies and time to complete the charge remain key barriers deterring Canadians from purchasing an EV. But even a moderate adoption scenario — with 6.5 million EVs on Canadian roads by 2030 — would require a 5.5 per cent increase in electricity demand.

“Growing electric vehicle adoption is inevitable,” Carcasole said. “By proactively developing strategic plans that position them strongly for the future, companies can avoid analysis paralysis and turn the challenges of this market inflection point into a significant opportunity.”