Green Cars: Reducing Range Anxiety and Increasing Incentives

The “green car” market is growing. Tesla may lead the way in luxury, but almost all auto manufacturers are investing significantly in plug-in electric vehicles (EV(s)). Policy, law, and regulation must change as the EV market expands.

The Governors of Colorado, Nevada, and Utah recently announced collaboration on building a regional electric vehicle corridor.[1] A network of charging stations will be built on Interstates 70, 76, and 25 in Colorado; Interstates 70, 80, and 15 in Utah; and Interstates 80 and 15 across Nevada, connecting more than 2,000 miles of highway. Colorado Governor John Hickenlooper said, “[o]ur residents and millions of visitors to our states will be able to drive electric vehicles from Denver to Salt Lake City to Las Vegas.”

This new network should address concerns that recharging is not available for long-distance travel or travel outside of major cities—otherwise known as range anxiety.  Charging stations on major highways are expected to transform the EV market. Beyond Tesla’s existing network, however, it is unclear what type of charging stations (i.e., level 1, level 2, or DC fast charging stations) may be available along interstates in these western states.

The Federal Highway Administration currently supports adoption of EVs through its special designation of Alternative Fuel Corridors. The agency has developed national signage, interactive gis maps, and branding for such corridors all in an effort to create public interest. Nevada has four such corridors: Interstate 80 and 15 and US 95 and 50.  These corridors and charging networks should make long-range trips viable and attractive for EV motorists.

Current financial incentives for EVs come from both tax and utility credits. Both federal and state tax credits for EVs have existed for many years. Utah’s 2017 legislature, however, failed to renew a $1500 state income tax credit for EVs that expired December 31, 2016. House Bill 29 extended the tax credit for vehicles and motorcycles and phased out the credit through 2021. That bill failed in the Utah House of Representatives by one vote.[2]  Utah currently ranks 7^th in the nation for the number of electric vehicles on the road.  Advocates for HB 29 argued the state tax credit was partially responsible for Utah’s EV adoption.

Utilities also offer incentive for EVs. For example, the Utah Public Service Commission recently created a separate phase for EV issues in its docket related to Rocky Mountain Power’s application to implement pilot programs authorized by the Sustainable Transportation and Energy Plan Act.[3] Stakeholders currently are working on details associated with new incentives for both the utility and its customers related to (i) residential time-of-use pricing for EV charging, (ii) research programs for EV load, and (iii) incentives for development of EV charging stations.

In the coming year, similar programs will be heard and approved by other utility commissions as EV adoption grows.  Law makers and regulators will be charged to respond to ever-growing EV markets. It seems financial incentives may be reduced as range anxiety is reduced through creation of recharging networks.

[1] Governors of Colorado, Utah and Nevada To Build Regional Electric Vehicle Corridor, http://energy.nv.gov/Media/Press_Releases/2016/Governors_of_Colorado,_Utah_and_Nevada_Announce_Joint_Action_to_Build_Regional_EV_Corridor/ (last accessed June 7, 2017)

[2] House Bill File, https://le.utah.gov/DynaBill/svotes.jsp?sessionid=2017GS&voteid=665&house=H (last accessed June 6, 2017).

[3] Utah Code Ann. §§ 54-20-101 to -107 (2016).