EVs Get Big Holiday Boost From Utility & Volkwagen Investments

2014-Chevrolet-Volt-006-mediumThough the future of electric vehicles remains murky at the federal level, due to Donald Trump’s hostility to climate science and love of oil and gas, the industry will receive a big boost from two companies this holiday season: California electric utilities and Volkswagen.

Volkswagen has agreed to a partial settlement from its emissions-cheating scandal, which could bring huge dividends to California if it’s enforced properly:

To mitigate environmental harm from their actions, the companies must pay $225 million into a national mitigation fund. California will receive about $41 million of that money for mitigation programs in the state designed to address the additional NOx emissions released by the vehicles in question. This is in addition to $1.2 billion VW is already paying California for mitigation and zero-emission vehicle (ZEV) infrastructure as part of the 2-liter partial consent decree.

The settlement, together with a previous consent decree, also requires the company to fund two “Green Cities” in California, which must have populations of at least 500,000 with many living primarily in disadvantaged communities.  These cities will receive “concentrated investment in ZEV programs like car sharing, ZEV transit or freight services and infrastructure and public awareness efforts to support those programs.”

An additional $25 million dollars will support programs such as “replace-and-upgrade programs for high-emitting cars in disadvantaged communities (EFMP Plus-up) and the Clean Vehicle Rebate Project (CVRP), which provide rebates and financial assistance for purchase of ZEVs.”

But perhaps most significantly, California consumers can expect new models of EVs to be fast-tracked:

[T]he manufacturers will provide at least three new models of electric vehicles for sale in California — including at least one SUV model — before 2019. The companies must add a second electric SUV model by 2020 and keep these electric models on the market through at least 2025. ZEV credits generated by placement of these vehicles in California cannot be sold on the ZEV credit market.

All in all, these provisions will definitely provide a major shot in the arm for the industry. As E&E news reports [paywall]:

Analysts say that in the early years of the investment, Volkswagen could nearly double the money spent on construction of EV charging infrastructure, seen as a way to spark more sales. States, cities and private companies are scrambling to get a piece of the Volkswagen pie.

“It’s just so much money,” said Ashley Horvat, vice president of strategic initiatives at PlugShare, an EV charging firm. “It will lay the groundwork for the future, and everybody is waiting to see how they fit into that future.”

Of course, some of the existing charging industry companies are afraid this investment will crowd out competition, while others worry it will allow Volkswagen to gain a monopoly advantage in a new industry — hardly a punitive outcome given the company’s malfeasance.

They also worry it may overshadow recently approved electric utility investment in charging infrastructure.  California regulators are finally letting these utilities get into the charging game, as E&E reports:

Last Friday, the California Public Utilities Commission approved a plan by the Pacific Gas and Electric Co. to build 7,500 EV charging stations in its Northern California territory. Ratepayers will shoulder the $130 million cost. It is the third major Californian utility to have an EV charging plan approved, after Southern California Edison and San Diego Gas & Electric.

All in all, states and private companies are (no pun intended) charging ahead with electric vehicles. This momentum may be necessary come January, when the new administration and its oil-and-gas allies in Congress could create some major headwinds for this vital industry.


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