Electric Vehicle Affordability Program (EVAP) 2026

What is the EVAP?

The Electric Vehicle Affordability Program is a $2.3-billion initiative designed to make EVs accessible to more Canadians. Unlike previous programs that focused on the manufacturer's suggested price (MSRP), EVAP is strictly focused on the final transaction value.

The goal is simple: encourage the sale of affordable EVs while supporting Canadian-made manufacturing.

Key dates to remember:

• February 16, 2026: Transactions (purchases or leases) signed on or after this date are eligible for the new incentives.
• March 31, 2026: The official EVAP submission portal opens. Dealerships will begin processing applications on this date.
• April 1, 2026: The program officially fully launches and is slated to run until March 31, 2031 (or until funding is exhausted).

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Who’s eligible for the incentives and how much can drivers receive?

Canadians and Canadian businesses purchasing or leasing an electric vehicle with a final transaction value of up to $50,000 can receive an incentive of up to $5,000 for battery-electric and fuel-cell electric vehicles. For plug-in hybrid electric vehicles, the incentive is up to $2,500. These incentives will be applied by the dealership at the point of sale. The incentive levels will decrease over time.

Individuals can receive one incentive over the 5-year life of the program, while businesses and non-profits can apply for up to 10 incentives. Additionally, approved carsharing companies are eligible to receive up to 50 incentives per year.

There are different limits for different types of buyers regarding the EVAP incentives:

• Individuals can receive one EVAP incentive over the five-year program.
• Organizations and businesses can receive up to ten EVAP incentives over the five-year program. Organizations and companies owned by the same individuals (unless publicly traded) will be treated as a single entity. Collectively, they can use the program to purchase up to 10 vehicles. This limit applies to the entire organization, not just to one department or division.
• Not-for-profit organizations, including charities, can also receive up to ten EVAP incentives over the five-year program. This limit applies to the whole organization, not just to one department or division.
• Provincial, territorial, and municipal governments with fleets can receive up to ten EVAP incentives over the five-year program. This limit pertains to the level of government, not just to one organization. Therefore, each provincial, territorial, or municipal fleet can use the program to purchase up to 10 vehicles.
• Eligible carsharing companies approved by Transport Canada can receive up to fifty EVAP incentives per calendar year.

Transport Canada will closely oversee the implementation of these incentives. If it is found that an individual or business has not fulfilled the eligibility criteria, has received more incentives than allowed (either during the program or within a single year), or has submitted false or misleading information, they will be required to repay the dealership(s) that granted the incentives.

Furthermore, the individual or business acknowledges that the dealership(s) have the right to take appropriate actions to recover the funds.

How much can drivers save with the Electric Vehicle Affordability Program?

The incentive amount depends on the type of vehicle you choose. In 2026, the maximum rebates are:

• $5,000 for Battery-Electric (BEV) and Fuel Cell Electric Vehicles.
• $2,500 for Plug-in Hybrid Electric Vehicles (PHEV).

These incentives are designed to decline over time. To minimize market disruption, the rebate amounts will drop every year starting January 1, 2027.

The $50,000 rule

The most significant change with EVAP is the eligibility cap. To qualify for a rebate, the final transaction value must be $50,000 or less.

• What’s included in the $50,000? The base price, optional features (like a sunroof or premium paint), dealer fees, and accessories installed at delivery. For Canadian-made EVs, there is no cap on the final transaction value; they can qualify even if they cost more.
• What’s excluded? Taxes, freight/PDI charges, winter tires, extended warranties, and insurance products do not count toward the $50,000 limit.

How do drivers get their EVAP incentive?

If you purchase or lease an electric vehicle with a final transaction value of $50,000 or less on or after February 16, 2026, you may be eligible for an incentive. Here are the steps involved:

1. The dealership must apply to Transport Canada to determine your eligibility.
2. You need to sign a Consumer Consent Form to allow them to complete this process on your behalf.
3. Once your application is approved (valid for 90 days), the incentive will be applied directly to your sale or lease agreement after accounting for taxes and fees.

This means you will receive the savings immediately when you purchase or lease the vehicle. You cannot apply for the incentive on your own. Only dealerships are authorized to submit claims for it.

Which vehicles are eligible for the EVAP incentive?

The EVAP Vehicle List includes electric vehicle models that manufacturers claim have a manufacturer's suggested retail price (MSRP) of $50,000 or less. However, please note the following:

• EVs not on this list may still qualify for an incentive if they meet the program criteria, including having a final transaction value of $50,000 or less.
• It is the final transaction value, not the MSRP or the list price, that determines an EV's eligibility for an incentive.
• For Canadian-made EVs, there is no cap on the final transaction value; they can qualify for an incentive even if their price exceeds $50,000.

Don’t forget about EV insurance

Switching to an electric vehicle not only changes how you refuel, but it can also affect your insurance rates. Many Canadian insurance companies offer green-vehicle discounts for electric and hybrid cars.

As you explore your options for a new EV under the EVAP program, let the experts at ThinkInsure assist you in finding the best specialized EV insurance coverage. We can compare quotes to ensure your new investment is protected at the most competitive price.

If you have questions about the program, you can contact Transport Canada directly at [email protected] or call 1-800-O-Canada.