Throughout his campaign, Joe Biden’s team spoke regularly about its goals to invest in badly needed new infrastructure. Whilst much of this related to the crumbling roads and bridges around the USA, Biden’s team want to encourage a revolution in clean energy infrastructure, electric vehicle adoption and the charging network. The administration has a $1.3tn investment plan to play with.
Like here in the UK, the Biden administration wants to see the USA hit net zero emissions by 2050 – a task made harder thanks to the Republican party’s roll back of emissions and fuel economy targets. For example, President Obama put in a 54 US MPG fleet average target by 2025, but Trump’s Republicans replaced it with a pitiful 40 US MPG.
Where states like California could waiver federal standards in favour of its own, Trump rolled back the waiver. But already, the auto industry itself is calling on Biden’s team to use California’s efficiency framework to form the basis of a nationally-implemented scheme, albeit a voluntary one at first.
On the emissions topic, one of Biden’s first acts was the re-join the Paris Climate Agreement. He has also installed Michigan Governor, Jennifer Granholm, to lead on energy policy, and Mayor Pete Buttigieg to lead on transport. Both individuals would be considered ‘progressives’ in the US.
Granholm is also hugely experienced in the automotive and renewable energy industries, having set up schemes to retrain out-of-work auto industry workers to get jobs in the renewable energy sector after the 2008 market crash. In the first 18 months of the scheme, 150,000 people enrolled. She also sits on the boards of a number of EV-related firms such as ChargePoint.
Where Pete Buttigieg is concerned, his $1.3tn budget will, in-part, go towards paying for EV infrastructure and incentivising businesses and private individuals to go green. In another of the administration’s aims, the new president has called for $300bn investment in R&D including EV technology, with $5bn over five years specifically on batteries.
Across the western world, governments offer tax cuts or incentives to purchase EVs. Here in the UK, we have the £3000 plug-in car grant as well as a grant of up to £500 for a home charger. Joe Biden’s administration wants to reintroduce similar schemes, including restoring federal tax credits for purchasing an EV – so buyers can claim a lump of tax back from the government depending on the type of vehicle they buy.
Making things easier still, the administration is looking at the possibility of offering an up-front rebate, which isn’t added to an individual’s tax return at the end of each fiscal year.
It has been widely reported that as well as encouraging private and business buyers to go electric, the administration will leverage its own enormous fleet purchasing power to replace ICE-powered government vehicles with EVs. This could amount to somewhere in the region of $400bn worth. Again, this scheme echoes those we have seen throughout Europe.
Whilst the administration is covering the bases from which an EV revolution can be founded, one of the biggest challenges for the USA is creating a suitable charging network. Over here, we have been known to moan because the nearest public charger might be ten miles away. The vastness of the US means that kind of coverage is downright fanciful.
To give you an idea of the issue the USA is facing, at present there are fewer than 100,000 chargers in a country of 328 million people and 9.8 million square kilometres. In the UK, we have over 37,000 individual connectors (20k+ chargers) in a country of 66.6 million people and just 242,500 square kilometres.
The administration’s plan is to build half-a-million chargers by 2030 which would be enough to cover around 57 per cent of the public’s requirements – according to a study by Bloomberg NEF. Until now, the USA has almost exclusively relied on car makers and private businesses to develop and provide public charging, so federal intervention will be a step-change.
If the federal plan of 500,000 chargers comes off, Bloomberg reckons the number of EV and PHEVs sold could be stimulated to increase to around 2.5 million per year.
As an EV-focussed outlet, the Trump administration represented almost everything that a developed, western democracy could do wrong for the industry. With the 46th president, it looks like the USA will be able to rapidly undo the harm that has been done and could well spark an EV revolution. Beyond EVs, re-joining the Paris Climate Agreement combined with proper environmental plans, overseen by apparently qualified individuals, is precisely what is needed at a time of climate crisis.
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