Zero Emissions Vehicle (ZEV) Mandates Workshop: Research for Effective, Efficient, and Equitable Policy Implementation

California and New York recently adopted the Advanced Clean Cars II rule, requiring all new light-duty vehicle sales to be electric by 2035, and the Advanced Clean Trucks rule, which requires a ramping up of medium- and heavy-duty electric vehicle sales to 75 percent by 2035. Achieving and requiring such a rapid transition to an electric transportation sector raises a number of questions, such as:

• What will happen to the used gasoline vehicle market, new vehicle sales (both electric and gasoline), and vehicle imports?
• How can we ensure that this transition will be equitable?
• What is the optimal pathway for charging station investments?
• How will this expansion of new ZEV sales affect the electricity sector, and what rules and regulations within the electric sector can help support this transition?

There are multiple avenues to explore and lots of new research that can be done in this space to help the states effectively, efficiently, and equitably achieve their ZEV goals. To that end, we hosted a two-half day virtual workshop with leading researchers and policymakers in the ZEV space to examine the state of research on zero-emission transportation, identify new researchable questions, and explore the data still needed to answer these questions. Below is our written communication summarizing the findings from the workshop and a new research agenda related to the ZEV mandate.

2:00 p.m. | Welcome Remarks

• Beia Spiller, Resources for the Future

2:05 p.m. | Fireside Chat

• Chris Smith, Ford Motor Company
• Richard G. Newell, Resources for the Future

In the conversation with Ford’s Chief Government Affairs Officer, Chris Smith, we learned what a large investment in vehicle electrification the private sector is making, including building new manufacturing and battery plants. To bring about greater electric vehicle adoption, the private sector will have to produce a wider range of vehicles to target different buyer types; but importantly, economies of scale will help bring costs down over time. One of the biggest takeaways from this conversation is how important charging station networks will be. It will be especially important to ensure that chargers allow for compatibility across different vehicles, that charging time decreases, and that the chargers are not only accessible broadly, but that they don’t malfunction.

2:35 p.m. | Distributional and Equity Concerns

• Erich Muehlegger, University of California, Davis
• Regan Patterson, University of California, Los Angeles
• Suzanne Russo, Pecan Street Inc.
• Mehri Mohebbi, University of Florida (Moderator)

During the conversation on distributional and equity concerns, it was clear that an equitable transition can mean a lot of different things: equity in access to vehicles and charging stations, equity in mobility, equity in air quality improvements, equity in terms of where the minerals are extracted and processed, where vehicles and batteries are manufactured, and so much more. There are a lot of open questions in this space, including how to increase EV adoption within disadvantaged communities, but also how to target the benefits of EVs towards these communities. Finally, the equity challenge of costs associated with the transition are broader than the costs of buying these vehicles; we also have to think about whether there are inequities between communities that would be reliant on public charging and communities that have access to at-home charging (both in terms of the price paid for charging and whether the local public charging stations are functioning well and have broad compatibility).

3:20 p.m. | Coffee Break

3:30 p.m. | Charging Station Network Development and Investments

• Mehrnaz Ghamami, Michigan State University
• Shanjun Li, Cornell University
• Katalin Springel, HEC Montréal
• Nafisa Lohawala, Resources for the Future (Moderator)

The previous conversation on equity segued well into the charging station panel, where compatibility is raised as a huge issue. However, this is not something that is easily solved if left to private decisions and investments. Charging stations are described as one of the largest and more cost-effective factors in bringing about greater EV adoption, though faster chargers were found to be more influential in driving EV adoption. Battery capacity is also intricately related to the prevalence of public charging stations, where longer ranges can allow for reduced investment in charging stations. It is clear that there is much more research that needs to happen, with place-based approaches being particularly important. Place-based research would help identify the benefits of investments and subsidies across different locations and cities, and would help us to better understand the challenges that occur in each location. This is especially true because uniform investments and cost sharing can actually worsen inequalities in terms of which locations see greater investment in public charging stations. Other open questions include understanding where people charge, when they charge, and their ability to respond to charging prices and times.

4:15 p.m. | Electric Regulatory Decisionmaking

• Severin Borenstein, University of California, Berkeley
• Peter Cappers, Lawrence Berkeley National Laboratory
• Elizabeth Stein, New York University School of Law
• Beia Spiller, Resources for the Future (Moderator)

The biggest takeaway from this session is that utilities will need to take greater action to understand the effects of their underlying tariffs. As more car buyers and medium- and heavy-duty fleets adopt EVs, this will be especially important to ensure that any innovative rates lead to efficient and equitable outcomes. These actions include running new pilots on EV owners to test out their price responsiveness, particularly since most of our understanding on customer price responsiveness is from residential household consumption patterns of use, rather than EV consumption. Since these are very different end-uses, we can’t necessarily just extrapolate our understanding to be able to predict outcomes in the EV space. Furthermore, any current research estimating EV price responsiveness will not necessarily be reflective of how later adopters may respond to prices. This is particularly true in the medium- and heavy-duty vehicle sector: early fleet adopters tend to be larger, more established fleets with experience managing their energy bills, while later adopters are more likely to be smaller, face more challenges in transitioning, and are likely to have less experience with complicated tariffs. The panelists called for increased pilots particularly for these fleets, to ensure that these tariffs don’t further block the transition to electric trucks and buses. Therefore, it’s important for us as researchers to continue to engage in research to understand how price responsiveness may change over time.

5:00 p.m. | Closing Remarks

• Beia Spiller, Resources for the Future

11:00 a.m. | Opening Remarks

• Beia Spiller, Resources for the Future

11:05 a.m. | Fireside Chat

• Rory Christian, New York State Public Service Commission
• Barbara Kates-Garnick, Tufts University and Resources for the Future

During the conversation with NY Public Service Commission’s CEO and Chair, Rory Christian, we learned just how important research is to the Commission and their decision making. They take into account all the information that researchers provide to them through their comment elicitation process. Mr. Christian spoke about how the Commission is particularly interested in research around incentives for charging station placement and rate design for customers. Because the Commission works within a cost-benefit framework, having more information on the pros and cons of different policies—such as the make ready programs and new innovative rate designs—can help them choose those that have the largest benefit for the cost incurred, as well as target policies that improve environmental justice outcomes.

11:35 a.m. | Electric Loads, Grid Impacts, and Environmental Outcomes

• Priya Chakraborty, University of California, Davis
• Kara Kockelman, University of Texas, Austin
• Alan Jenn, University of California, Davis
• Steve Letendre, Nuvve
• Karen Palmer, Resources for the Future (Moderator)

In this panel, we heard from experts about the environmental and grid impacts of ZEV mandates. We learned that electrifying the entire vehicle fleet will require a big ramp up in electric generation—up to 20% added energy—though it will probably take us around 20 years to get there, so we have time for planning. However, local distribution impacts are likely going to be more important in the short-run, as a few households simultaneously charging their vehicles could exceed local infrastructure capacity. This means that we need to have a better picture of where these vehicles are going to be and how much electricity they will need. And having a clear picture of this upcoming increase in electricity demand requires us to think about managed charging and the potential for V2G as technologies to help mitigate the costs of charging. However, an open question in this space is how do we accurately pay for the services these technologies provide, particularly because the actual value of these services can vary significantly across time and location. More work needs to be done to accurately value reductions in demand on the distribution system and create incentives and payments to reflect that.

12:30 p.m. | Lunch Break

1:00 p.m. | Vehicle Demand and Supply

• Kenneth Gillingham, Yale University
• Benjamin Leard, University of Tennessee and Resources for the Future
• Margaret Mann, National Renewable Energy Laboratory
• Anna Spurlock, Lawrence Berkeley National Laboratory
• Joshua Linn, Resources for the Future (Moderator)

In the workshop’s final panel, we learned that though current demands for EVs are not very high, this is in part due to the fact that EVs are more expensive and that there is also a current lack of EV offerings. Policies such as the ZEV mandates, IRA incentives and efficiency standards can entice manufacturers to provide both more EV options and more affordable EV offerings, thereby reducing these challenges. We also heard about upstream constraints and how supply chain restrictions around critical minerals and other equipment, like cathodes, may affect both the availability of equipment needed to produce these EVs and the price of making these vehicles. Actions such as onshoring the extraction and processing of critical minerals can help overcome geopolitical constraints and market power, yet it can lead to increases in vehicle prices. However, manufacturers can leverage new battery technologies to reduce demand of some critical minerals, and policies like IRA are also helpful, so these issues may be short-lived. Finally, the panelists highlighted the need for more research on the used EV car market. Since we don’t have a lot of data, it has been hard to conduct empirical research. But we need to start engaging in this research once the data become available, particularly due to the equity benefits of used vehicle market expansion and the IRA incentives available for these vehicles. One core question has been unanswered so far: how much will incentives create new demand and supply for used EVs?

1:55 p.m. | Closing Remarks

• Beia Spiller, Resources for the Future