Image Source: Newsweek
Between the combination of surging electric vehicle demand and the recent spur of legislation propelling the EV market forward, it is an exciting time to be a part of the electric vehicle community, both as a producer and as a consumer. However, it is important that legislation in the United States does not overlook the critical component of expanding electric vehicle infrastructure.
Until recently, it was without question that electric vehicle tailwinds driving the influx in consumer purchases were far outpacing the legislation supporting the electric vehicle industry. However, on September 14th, the Biden-Harris administration announced their approval of 35 state plans to build out the currently lacking electric vehicle infrastructure, spanning 53,000 miles of highways across the United States. The current details of the approved program allow states to access $5 billion dollars over the course of the next five years with the hopes of developing an affordable and efficient EV charging network across the nation. In addition to the $5 billion being provided, the Biden administration has been vocal about their goal to see 500,000 EV chargers built by 2030. This target is in line with their overall goal of reaching net-zero emissions by the year 2050. However, many experts still have concerns that forecasted demand is far outpacing the actual feasibility of an expedited move toward EVs unless infrastructure and charging technology are improved. To provide context, the fastest electric vehicle charging stations offer a refuel time that is ten times slower than that of what it takes to fill a tank of gas. At the same time, charging stations are exponentially scarcer than their petroleum counterparts.
Despite concerns surrounding EV infrastructure and charging time, there is a large camp of industry experts who believe the recent influx of grants to build charging stations will be the impetus the electric vehicle infrastructure needs to gain popularity. This sentiment has been echoed across EV industry forecasts, which have continuously raised projections amidst the changing legislative backdrop, highlighted nationally by the recent passing of the September infrastructure law, along with the Inflation Reduction Act. In the IRA, EV owners are provided subsidies in the form of a $7,500 tax credit upon purchase. At the same time, some states have taken their own aggressive stances in support of Electric Vehicles. California, Washington, New York, Massachusetts, and Virginia have all passed legislation banning the sale of new gasoline-powered cars and light trucks by the year 2035, with 13 additional states planning on adopting their own version of this ban in the near future. The result of this influx of legislation can be seen in the recent forecast adjustments done by BloombergNEF. EV sales by 2030 originally came in at 43% of U.S. passenger vehicle sales, however, with the current climate-spending measures in place, the estimate was revised to 52%.
Image Source: BloomsbergNEF
Among those who have become believers in the future viability of the American EV market are many European charger production companies, such as Kempower. Kempower is responsible for EV infrastructure development in Northern European countries such as the Netherlands, Norway, and Sweden. Kempower CEO Tomi Ristimaki recently voiced his support of his company’s expansion into the U.S., stating, “I don’t normally like subsidy markets much but the subsidy in the U.S. has become so large that it actually pushes charger infrastructure forward.” With an increase of EV infrastructure companies entering the U.S. marketplace, the likelihood of a smooth transition to electric vehicles grows increasingly possible.
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