This report explores the feasability of using specific fiscal instruments to accelerate or enhance the reduction of air pollution emissions from heavy duty diesel engines in surface vehicles in Canada, including trucks, both on-road and off-road, and transit buses. The set of instruments selected are in two groups: Those affecting engines and those affecting fuels. The instruments that might induce the production and purchase of cleaner engines or the retrofit of cleaner technology on existing engines are a fee/rebate, tax credit, and an accelerated capital cost allowance. Those that might accelerate the introduction of low sulphur fuel or increase the extent of sulphur removal are differential taxes on diesel fuel based on sulphur content and ACCA for refineries investing in sulphur removal.
This paper how focuses on what effective transport arrangements might be sustained in Canada if oil supplies were to become constrained. It discusses various alternative fuels for transportation vehicles.