Ga. could decide if the U.S. gets clean cars

Source: By Maxine Joselow, E&E News reporter • Posted: Wednesday, January 6, 2021

The Senate runoff elections in Georgia will help influence how quickly President-elect Joe Biden can boost electric vehicle sales to fight climate change, experts say.

If Democrats Raphael Warnock and Jon Ossoff pull off surprise wins tomorrow, the Senate could pass muscular measures to increase clean car sales, including an expansion of the federal electric vehicle tax credit and a “Cash for Clunkers” proposal from Minority Leader Chuck Schumer (D-N.Y.).

If incumbent Republican Sens. Kelly Loeffler and David Perdue prevail, EV measures could be dead on arrival under the continued control of Majority Leader Mitch McConnell of Kentucky.

“Many of our priorities are congressional priorities,” said Joseph Britton, executive director of the Zero Emission Transportation Association, a lobbying group that was recently launched to push for 100% EV sales by 2030.

“And obviously, we would love to have the administration join forces” with Congress, said Britton, the former chief of staff to Sen. Martin Heinrich (D-N.M.).

Biden campaigned on a climate platform that called for achieving net-zero emissions by 2050. Meeting that goal depends on slashing emissions from transportation, the country’s largest source of greenhouse gases, by getting more people into clean cars and onto public transit.

A key policy lever for reducing the cost of clean cars is the federal EV tax credit, which allows EV buyers to receive up to $7,500 back after filing their tax returns.

The credit expires after an automaker has sold 200,000 eligible vehicles. Both Tesla Inc. and General Motors Co. have reached the cap.

The “Moving Forward Act,” H.R. 2, would raise the cap to 600,000 vehicles while lowering the maximum credit to $7,000 after an automaker has sold 200,000 units.

The measure passed the Democratic-led House last year but stalled in the Senate.

According to a recent research note by BloombergNEF, the “Moving Forward Act” would extend the subsidy to at least 7.5 million EVs, compared with 1.9 million EVs under current law.

“Chances for expansions or extensions will rise if Democrats wrest majority control of the Senate from Republicans,” the research note said.

‘Clunkers’ and chargers

Another meaty EV proposal floating around the halls of Congress comes from Schumer, the Senate minority leader.

The plan, dubbed “Clean Cars for America,” would give consumers a cash voucher to trade in their gasoline-powered cars for new zero-emission vehicles (E&E Daily, Oct. 25, 2019).

In a Dec. 23 statement, Schumer said he had discussed the plan with Biden’s nominees for key climate positions, including EPA administrator nominee Michael Regan and Energy secretary nominee Jennifer Granholm.

“Our wide-ranging discussion covered many aspects of the bold climate agenda we will execute with the Biden-Harris administration, including … my Clean Cars for America proposal, which calls for 100% of new vehicle sales to be clean vehicles by 2030,” Schumer said.

John Graham, a professor at Indiana University’s Paul H. O’Neill School of Public and Environmental Affairs and chair of the EPA Science Advisory Board, said in an email that he thinks modest EV legislation could pass in 2021 or 2022, “even if the GOP wins one or both of the Georgia Senate seats (which seems highly likely).”

Graham noted that a bipartisan coalition of senators — including Republican Sens. Susan Collins of Maine and Lamar Alexander of Tennessee — backed a measure to expand the federal EV tax credit early in President Trump’s term.

But the Schumer proposal appears too far-reaching to advance under continued GOP control, Graham said.

“The Schumer plan is much too grandiose to pass in a GOP-majority Senate, but … it might be able to pass a Democratic-majority Senate, assuming it is attached to a budgetary bill that is not subject to a filibuster threat,” he said.

Even if more Americans buy EVs, the country will need more places to charge them. Biden campaigned on a goal of installing 500,000 charging outlets nationwide.

The Senate Environment and Public Works Committee passed a $287 billion highway bill last year that included a $10 billion section devoted to combating climate change and building EV charging stations. But Congress ended up punting infrastructure negotiations to this year.

Britton of the Zero Emission Transportation Association expressed hope that both parties would support funding for charging stations in a forthcoming infrastructure bill.

“I think for Democrats and Republicans, if we’re doing these major infrastructure investments and helping these communities meet their needs, that’s a win for everybody,” he said. “There’s nothing inherently loaded politically about that.”

Executive action

To be sure, Biden could promote EVs through executive action, regardless of the balance of power on Capitol Hill.

The single biggest step he can take is crafting strong vehicle emission and fuel economy standards, sources said.

Trump significantly weakened the clean car standards when he issued the Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule. It required automakers to increase the average fuel efficiency of their passenger cars by 1.5% each year, rather than the 4.7% annual increases mandated by President Obama.

Soon after taking office on Jan. 20, Biden is expected to direct EPA and the Department of Transportation to begin crafting clean car rules that exceed the Obama-era requirements.

“The Trump administration really weakened the approach on vehicle efficiency. [Biden’s DOT] could work with EPA and get a lot more ambitious in pushing technology. That’s the clear and straightforward lever,” said Beth Osborne, director of Transportation for America, an advocacy group.

Corey Cantor, a transport analyst at BloombergNEF, echoed that sentiment.

“The best thing you can do for the EV sector at large is going to be these CAFE standard negotiations,” Cantor said, using the acronym for corporate average fuel economy.

Another federal agency — the Department of Energy — could play a role in research and development on EV batteries, although new funding for R&D would need to be appropriated by Congress.

The Zero Emission Transportation Association is pushing Biden to create an office within DOE to oversee the national transition to clean energy and EVs.

“We’re recommending — and this is something that’s not just for EVs but for the entire clean tech space — a DOE Office of Industrial Transformation to ensure that as we’re making the transition to a decarbonized economy, we’re working overtime to ensure that means economic development and job creation here domestically,” Britton said.

“Are these big-ticket game changers? Obviously those are the consumer incentives and the big federal investments in infrastructure,” he added. “But we think there’s a ton we can do on the administrative side.”