North Cowichan is considering spending more for its plans to electrify all of its transit and municipal fleet by 2030 as infrastructure costs increase.
The municipality’s committee of the whole decided at its meeting on Jan. 7 to recommend increasing the budget for the project after staff reported that the required electrical-charging infrastructure at the municipal hall and public works is now estimated at more than $1 million.
That’s significantly more than the $375,000 that council had originally authorized in 2022 for the infrastructure at the municipal hall and public works, as well as the Fuller Lake Arena, and the Cowichan Aquatic Centre.
Council planned to pay for the $375,000 from its Climate Action and Energy Plan reserves and funding from the province’s Local Government Climate Action Program.
At the COW meeting, staff recommended that the additional money for the increased infrastructure come from more funding from CAEP ($53,000), LGCAP ($167,000), more than $200,000 from grants from BC Hydro and the province, and the remaining $340,000 would be raised through short-term borrowing from the Municipal Finance Authority.
Coun. Mike Caljouw asked George Farkas, North Cowichan’s general manager of planning, development and community services, what the consequences of not moving forward with the electrification program would be.
Farkas replied that the first consequence would be that the municipality would not be able to realize the objectives of its climate, action and energy plan.
He said there are some pretty aggressive green-gas reduction targets that council has committed to and the program will help council achieve those objectives.
“Another consequence is that we do have an electric garbage truck scheduled to arrive in June and not receiving direction soon puts us in a position where we won’t have the infrastructure in place by, hopefully, this summer that allows us to utilize that vehicle to help implement the automated-collection process which starts this summer as well,” Farkas said.
Coun. Chris Istace said it’s a tough issue dealing with escalating costs.
“I don’t think this would be an issue if we weren’t dealing with the tax year we’re facing, but the initial costs of putting the infrastructure together to support the electrification of our fleet are one-time costs,” he said.
“Once we get those out of the way, all these investments now will pay for themselves.”
Coun. Bruce Findlay said the infrastructure cost of $1.08 million is almost three per cent of any tax increases in North Cowichan.
“While some money is coming from potential grants, we’re clearing out a bunch of reserve funds in order to do this, plus we’re borrowing money,” he said. “It’s still between 2.5 and three per cent on our taxes spread out over time and I have a problem with that.”
Mayor Rob Douglas pointed out that the electrical infrastructure costs are being funded almost entirely by reserve funds, grants and borrowing and will not be increasing property taxes by 2.5 to three per cent in the 2025 budget.
"Analysis from North Cowichan staff showed a strong business case for replacing some of the existing light-duty vehicles with electric vehicles and also purchasing a new electric garbage truck, with annual operating savings of nearly $60,000," he said.
"Simply put, electric vehicles are less expensive than conventional vehicles over the life of the asset due to the fuel cost savings and lower maintenance costs."
Coun. Christopher Justice agreed that nobody likes the idea of increased costs.
“I did come in here thinking that, even despite our CAEP goals that I’m pretty dedicated to, given our difficult tax year, it might make sense to limit our infrastructure expansion by somehow postponing the adoption of the electric-garbage collection, but I think what I’ve heard from staff is that postponing the infrastructure upgrades don’t make much financial sense,” he said.
“I think we’re too far down the road to reverse course on this.”
Coun. Tek Manhas said he often hears that such costs amount to just a cup of coffee a day.
“But all those cups of coffee all add up, and we’re looking at a 9.1 per cent tax increase this year,” he said.
The motion to recommend that council fund the increased costs of the electrical infrastructure passed, with Manhas and Findlay opposed.
