Climate supply faces tough path on money for electric cars, Auto News, ET Auto
WASHINGTON (Reuters) – Biparty compromise on infrastructure halves President Joe Biden’s call to $ 15 billion to build 500,000 electric vehicle charging points, raising stakes as administration seeks cooperation from the automotive industry on anti-pollution rules to curb climate change.
Senate legislation provides $ 7.5 billion in federal grants to build a nationwide network of charging stations, an amount that analysts say is a good start but not enough to spur adoption widespread use of electric vehicles.
Yet even the smallest amount can be effective if placed in the right places, said Jessika Trancik, a professor at the Massachusetts Institute of Technology who studies electric vehicle charging.
“If there is half the funding, you have to be twice as strategic and twice as deliberate,” she said.
Biden has made tackling climate change a political priority, and the broad compromise bill reached after intense negotiations takes a few steps towards his goal of halving greenhouse gas emissions by 2030 .
The widespread availability of electric charging stations in communities large and small is a cornerstone of its efforts to shift the U.S. fleet of cars and trucks from polluting combustion engines to zero-emission electric vehicles. Many drivers are reluctant to make the switch for fear of running out of power with no charging station in sight.
The back and forth in a tightly divided congress on electric vehicle financing reflects a delicate balance for the auto industry and the Biden administration. The transportation sector is the largest US contributor to climate change.
Currently, there are just over 43,000 charging stations in the United States with more than 106,000 outlets, according to the Department of Energy. Fully electric vehicles only accounted for 2.2% of new vehicle sales in the United States in the first half of this year, or about 1.1 million vehicles in circulation.
The Biden administration had planned to build half a million charging units across the country to keep a campaign promise and push significant numbers of Americans to adopt zero-emission vehicles by 2030. It had l plan to secure an additional $ 7.5 billion in low-cost loans from a public-private investment infrastructure bank that was to be created in the Senate bill.
But the president’s plans evaporated on Wednesday after lawmakers haggled over wage laws for the $ 20 billion bank-covered transport projects ditched him and scrapped him. The White House now says it will not set a specific target for units of charge, but hopes to find other funding to close the gap.
“The future of cars is electric and we are ready,” Transport Secretary Pete Buttigieg tweeted Wednesday after the bipartisan deal was announced.
The Associated Press reported on Tuesday that the Biden administration plans to release proposed rules as early as next week on tailpipe emission standards, including non-binding language that at least 40% of sales in the United States would be electric vehicles, according to government and industry sources who spoke on condition of anonymity to reveal details that are still being finalized.
While Ford CEO Jim Farley on Wednesday said he expects 40% of the company’s sales to be fully electric vehicles by 2030, other companies are still wondering if they should. approve this figure. Stellantis, for example, has pledged to achieve 40% revenue in the United States, but has “low-emission vehicles” such as gas-electric hybrids in its mix.
Over the past year, American automakers have ramped up announcements of new electric vehicles, spending billions to develop them. Some, including General Motors and Volvo, have set a goal of selling only electric passenger vehicles by 2035.
But almost all said it would take government incentives to persuade people to switch to new technology, at least until EV prices drop as more and more are produced and sold. And they said government spending on charging infrastructure is key to overcoming consumer anxiety about running out of power.
Biden originally offered $ 174 billion in his Build Back Better plan to boost the electric vehicle market, including tax credits and other incentives to get consumers to embrace the new technology. While only $ 7.5 billion from the bipartisan bill will go to charging stations, Democrats are expected to add around $ 100 billion in electric vehicle tax credits in a separate 3-month “reconciliation” bill. 500 billion dollars. The support of the 50 Democratic senators will be necessary for this bill to pass.
“If a reconciliation bill appears with 10-digit guaranteed discount for electric vehicles, it will go a long way to reassure automakers that they can ramp up production,” said Jeff Davis, senior researcher at Eno Center for Transportation.
Automakers have made it clear that the government needs to help move away from internal combustion engines.
“Much of this transition will depend on government support and infrastructure construction,” Ford’s Farley said on his second quarter earnings conference call Wednesday.
Concern over limited range and the availability of charging stations was among the top concerns consumers have about owning an electric vehicle, according to a Consumer Reports poll last December.
Currently, electric vehicle owners charge their vehicles at home 80% of the time. But that is likely to change as more people buy electric vehicles that don’t have a garage to house a charging station.
The new chargers are expected to be located based on models that predict where they will be needed, MIT’s Trancik said. They should be placed along travel corridors for people who travel long distances, as well as in areas where people spend a lot of time, such as hotels, apartment building parking lots and even along streets. public, she said. The government will also need to increase incentives to build charging stations in less populated rural areas, she said.
Fast DC chargers, which can charge a car up to 80% of its battery capacity in 20 to 45 minutes, are quite expensive, from $ 40,000 to $ 100,000. These should therefore be placed where people need to recharge quickly and get back on the road.
240-volt electric chargers, similar to a clothes dryer, are much cheaper, around $ 2,000. It takes about eight hours to fully charge a car. Trancik says they can be used effectively at much lower costs in areas where people stay for long periods.