Biofuels (like biodiesel) are greenwashing. People use the argument that it has a lower carbon footprint because the carbon dioxide that is produced during burning is balanced by the carbon dioxide that is absorbed when growing the crops. The reality is regardless of the fuel source, you are taking carbon that is in captured form and releasing it into the atmosphere as CO2 along with other pollutants.
The greenwashing argument relies on the fact that it blends in fossil fuels and usually is sourced from agricultural output that used significant fossil fuel inputs to grow. Using carbon stored in a plant is not an issue. You and I literally do that everyday. It's releasing the carbon stored up underground that is the issue. Were we to come up with 100% biofuel that was somehow sourced only from farming that used electrified machinery it wouldn't be as much of a greenwashing argument. And to that end, sectors like aviation are working on sourcing such fuels. Would work for VIA's diesel trains, if there really is such concern. That said, I think the concern is ridiculously overblown in the context of the alternative which is driving and flying. Even a diesel train sips fuel at something like 0.5 - 1 L/100 pax-km. Amtrak at low occupancy and with lots of very old trains is over 71 pmpg (3.3 L/100 pax-km) network wide. Absent an electric train that is powered by almost 100% non-emitting electricity, diesel trains are some of the most efficient transportation systems we have.
I wouldn't want an argument of electrifying HFR to get in the way of its construction as there are environmental benefits of reducing the number of cars on the road even if the train is diesel powered, but I do feel it is important to electrify our transportation and the construction of a new line is a good opportunity to move the yardsticks in this direction.
It's really important to put the environmental and economic benefits in their proper context. Electrification early on will most likely come at the cost of network expansion which means more folks driving and flying. Moving new ridership onto the rail network does a lot more for the environment than electrification does. Consider someone driving a reasonable efficient vehicle doing say 7 L/100km. Compare that to a train doing about 1 L/100km. Even with double occupancy in the car, the train would be about 3.5x more fuel efficient. Those passengers using the train save 3.5x more fuel than electrifying their train would.
Cost wise, electrification would also be a poor proposition early on. A project built on borrowed money requires their investment to pay off. And the savings from not having diesel operations is going to a very long time to return the capital invested. On the other hand, investing that same capital in network expansion or enabling higher speeds attracts new passengers and boosts revenue.
Electrification is important. But it should be saved for a logical time, once the corridor is finished building. I would argue that electrification is better suited to a project in the 2040s when the corridor is finished Quebec City to Windsor, and the now 15+ yr old Chargers can be parted out economically, Demand will be up and VIA will probably be at semi-hourly service through the full day. At that point with costs rising from increasing demand and no ability to add customers through expansion, the obvious investment is electrification both to speed up the train (to add frequency) and to reduce operating costs. And in 15-20 years with cars having been substantially electrified, VIA will probably be at a point where they need electrification to compete with EVs. A corollary is that in 20 year battery tech may also be substantially developed that we won't need to spend money on installing catenary across the entire length of the corridor. So there might be opportunities for savings.