Electric car battery-maker gets $17M from Ontario

AMississauga-based company that makes batteries for electric cars will get $17 millionfrom the Ontario government to expand its operation.

Premier Dalton McGuinty will be at the headquarters of Electrovaya outside Toronto on Tuesday to announce funding that's expected to create 240 new jobs at the company.

Electrovaya is a maker of lithium-ion battery packs and has inked deals with companies internationally to produce components for electric cars.

It has teamed up with India's Tata Motors to produce the Maya-300, an electric car designed for city driving.

Last month, McGuinty announced rebates of up to $10,000 for people who buy electric cars, a move that critics warned could actually hamper the development of next-generation technology.

The plan will give buyers of plug-in hybrids and battery electric cars rebates between $4,000 and $10,000 for vehicles purchased after July 1, 2010.

One auto industry analyst said by "bribing consumers" to buy electric, the government was indirectly diverting resources from other more promising technologies.

A study out of the University of British Columbia found that government rebates on hybrid vehicles aren't producing the environmental results that were expected.