EVs, GHGs, and the Infrastructure Deal: What We Know So Far

With transportation accounting for 29 percent of greenhouse gas (GHG) emissions in 2019, a transition to electric vehicles (EVs) is critical for curbing GHGs. To that end, President Biden just signed an Executive Order designed to push EV adoption by 2030 and regulate tailpipe emissions from existing gas-powered vehicles.

However, to achieve the goal of a substantial transition to EVs by 2030, the U.S. needs significant investment in EV charging and the grid. The bipartisan infrastructure deal proposes investments of $7.5 billion for EV chargers, as well as $73 billion for improvements to the electric grid to support the greater electricity demand from increased EV adoption. How does the EV funding in the infrastructure bill stack up?

Here’s what we know:

• While the legislation’s grid investments are supported by some industry studies, the amount proposed for EV charging infrastructure likely falls short. To serve a fleet of approximately 20 million EVs by 2030, one study estimates that the U.S. will need $28 billion to install approximately 2 million EV chargers needed to support the targeted EV adoption. Another analysis determines that the U.S. will need $30-$50 billion to install 6-10 million at-home chargers and roughly 2 million public chargers.
• EVs are also critical to advancing environmental justice goals by reducing emissions of harmful pollutants that are linked to increased risks of illness and death, particularly for low-to moderate-income (LMI) communities. Increasing adoption of EVs can thus provide air quality benefits to LMI communities while advancing national goals for curbing GHG emissions. However, existing EV ownership rates are low in LMI communities, and LMI households are more likely to live in multifamily dwellings where they are often limited in their ability to install chargers. So, while the cost of EVs is expected to become comparable to conventional vehicles by 2025—reducing part of the barrier to ownership in LMI communities. EV adoption in these communities that would most benefit from reduction in transportation-related emissions could be stalled without the expansion of publicly available charging options.

Since federal funding appears to fall short of the amount required to meet the anticipated future demand for EV charging infrastructure, states will need to pursue additional financial resources to bridge the gap in the interim. As of July 2020, 80 percent of the $5 billion Volkswagen owes through a settlement for fraudulent diesel emissions data had not been allocated. So, while we search for alternate solutions to close this too-wide gap, at least there’s a significant opportunity for states—which disperse the funds--to expand their EV infrastructure in a substantial and equitable manner.