The B2B platform for full-electric and plug-in hybrid electric vehicles: Policy News

President Obama enjoys industry support for a single national fuel-efficiency standard. The industry is less enthusiastic about an Electric Drive Vehicle Deployment Act proposed by U.S. House and Senate, focusing generous funds for the deployment of electric mobility on some selected communities.

Industry and government teaming up

President Obama sees tougher fuel-efficiency standards as way forward in the fight against climate change. He charged the Environmental Protection Agency (EPA) and the Transportation Department to develop new fuel and emissions standards, limiting greenhouse gas pollution from medium- and heavy-duty trucks and further reducing exhaust from cars and light-duty trucks beyond the requirements of last month's bill.

In April 2010, a bill was released, prescribing fuel-efficiency of 35.5 miles to the gallon for new cars by 2016, in combined city and highway driving. The president, however, wishes to impose further improvements in fuel efficiency for cars and light trucks with years of construction 2017 and beyond, and in medium and heavy trucks with years of construction between 2014-18.  

Although medium and heavy trucks only represent 4% of the U.S. highway fleet, they account for more than 20% of fuel consumption, according to the Union of Concerned Scientists. This environmental advocacy group calculated that achieving an average fuel economy of these trucks by 3.7 miles to the gallon would save 11 billion gallons oil until 2030.

Mr. Obama's executive order also asks for more federal support in the development of new types of cars such as electric vehicles, and instructs the EPA to further reduce non-greenhouse gas emissions by motor vehicles. His vision is to have a fleet of twice as efficient and half as pollutant cars in 20 years. According to government officials, the higher costs of building cleaner cars (calculated at an additional 1,000$ per vehicle by 2016) would help save consumers around 3,000$ in fuel over the vehicle's life time.

In this endeavour, the U.S. president enjoys the support of major truck manufacturers such as Volvo, Daimler Trucks North America, Cummins, Navistar and the American Trucking Association. The industry is in favour of a single national standard that will be easier to comply to than the current dispersed state and national regulations such as

• the fuel efficiency standards by the National Highway Traffic Safety Administration in response to Congressional legislations;
• greenhouse gas standards developed by the EPA under the Clean Air Act;
• separate standards enacted in California and 13 other states;  

Democrats and Republicans teaming up

As much as the industry supports the president in regards to a common national fuel-efficiency standard, they are critical in regard to the “Electric Drive Vehicle Deployment Act of 2010”, proposed by the U.S. House and Senate in order to promote a broad uptake of electric mobility.

The House bill foresees the distribution of $800 million each to five U.S. communities for the deployment of around 700,000 electric vehicles in the next six years. The first 100,000 residents of these five communities would receive a $2,000 purchase subvention plus every American is eligible to a $7,500 tax credit to buy an EV. The set-up of charging stations would also be subsidised.

The Senate bill suggests to select 15 communities and grant them $250 million each for the construction of viable EV infrastructure. The earmarked funds would also cover research and development as well as subventions for larger hybrids.  

The U.S. Electrification Coalition has warmly welcomed the proposed bills. To underline the advantages of large EV deployment and calm critic spirits, they have published an economic impact study of their proposed infrastructure roadmap last month. The major findings of which are:

• 1.9 million new jobs, including 560,000 in manufacturing could be created until 2030;
• $3,687 of savings from transport expanses per household;
• estimated 11.9 billion fewer barrels of imported crude oil in the period 2011-2020;

The industry's point of critic is the concentration of federal funds on a handful of selected communities. The automotive sector fears that this might turn EVs into a chic accessory instead of becoming a viable option for the masses.