Arizona Statewide Transportation Electrification Plan: Phase II Prepared for Arizona Public Service & Tucson Electric Power
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Arizona Statewide Transportation Electrification Plan: Phase II Prepared for Arizona Public Service & Tucson Electric Power March 2021 Prepared by: Energy and Environmental Economics, Inc. (E3) 415.391.5100 | 44 Montgomery Street, Suite 1500, San Francisco, CA 94104 | www.ethree.com Contents Executive Summary ......................................................................................................................... 1 1. Introduction: Our Process...................................................................................................... 10 1.1 Phase II Focus and Structure of the Statewide TE Plan ............................................................... 10 1.2 Stakeholder Input to the Phase II TE Plan ................................................................................... 11 1.3 Utility and Other Transportation Electrification Stakeholder Roles ............................................ 11 1.4 Ongoing Collaboration and Future Updates to the Statewide TE Plan ....................................... 12 1.5 Establishing a Statewide Transportation Electrification Goal ..................................................... 12 2. Transportation Electrification Market and Technology Assessment .................................... 14 2.1 Introduction................................................................................................................................. 14 2.2 Arizona’s Vehicle Fleet Today: Composition and Emissions Profile ............................................ 14 2.3 Technology Assessment Approach .............................................................................................. 17 2.4 Key Grid Integration Opportunities and Challenges .................................................................... 19 2.5 Key Barriers ................................................................................................................................. 20 3. Transportation Electrification Policies and Institutions ........................................................ 23 3.1 Federal Policies, Regulations, and Programs ............................................................................... 23 3.2 Regional Transportation Electrification Initiative ........................................................................ 30 3.3 Arizona State Policies Supporting Transportation Electrification ............................................... 30 3.4 Local Programs, Initiatives and Commitments ............................................................................ 32 4. Transportation Electrification Provides Net Benefits for Arizonans ..................................... 35 4.1 Scoping the Phase II Transportation Electrification Analysis ...................................................... 35 4.2 Methodology ............................................................................................................................... 35 4.3 Results ......................................................................................................................................... 45 5. Gaps Analysis and Recommended Actions ............................................................................ 55 5.1 Summary of Barriers to Transportation Electrification ............................................................... 55 5.2 Summary of Recommended Actions by Actor............................................................................. 56 5.3 Addressing the Gaps: Recommended Initiatives to Promote Transportation Electrification in Arizona ........................................................................................................................................ 57 6. Establishing a Statewide Transportation Electrification Goal and Planned Utility Support Initiatives ............................................................................................................................... 68 6.1 Arizona 2030 Statewide EV Goal ................................................................................................. 68 2021 Energy and Environmental Economics, Inc. Arizona Statewide Transportation Electrification Plan i 6.2 APS and TEP Initiatives ................................................................................................................ 69 6.3 Metrics to Track Progress ............................................................................................................ 76 7. Conclusion ............................................................................................................................. 79 8. Appendix ............................................................................................................................... 8-1 8.1 Appendix A: Electric Drive Technology Survey ........................................................................... 8-1 8.2 Appendix B: Additional Analytical Results and Methodological Detail .................................... 8-33 8.3 Appendix C: Working Group Reports ....................................................................................... 8-51 8.4 Appendix D: Organizations Involved in the Phase II TE Plan Process ....................................... 8-52 8.5 Appendix E: Stakeholder Comments on Draft Report .............................................................. 8-56 8.6 Appendix F: TEP 5-Year Strategic EV Roadmap ........................................................................ 8-76 Figures Figure 1. TE Provides Net Benefits to Drivers, Utility Ratepayers, and Arizona with faster adoption leading to higher benefits. ...................................................................................................................... 3 Figure 2. Utility Service Territories in Arizona, updated July 2018 ............................................................... 13 Figure 3. On-road gasoline or diesel vehicles registered in Arizona as of January 2020 .............................. 15 Figure 4. Arizona's energy-related carbon dioxide emissions, 2017 ............................................................ 16 Figure 5. Breakdown of United States carbon dioxide emissions from transportation, 2018 , ..................... 17 Figure 6. CARB Commercialization Pathways and Technology Readiness Levels ......................................... 18 Figure 7. On-Road Battery Electric Vehicle Technology Status Snapshot, CARB , ......................................... 19 Figure 8. Federal EV Tax Credit Tracking by Automaker (through June 2020) ............................................. 24 Figure 9. NAAQS Nonattainment Areas in Arizona ....................................................................................... 26 Figure 10. Electrify America's planned national DCFC charging network, plus metropolitan areas targeted for local charging infrastructure support ................................................................................. 28 Figure 11. Air quality modeling methodology used in this study. ................................................................ 37 Figure 12. Statewide electric LDV adoption by scenario, note that other vehicle adoption charts are included in Appendix B: Additional Analytical Results and Methodological Detail. ................. 40 Figure 13. Personal LDV weekly driving pattern from Markov-Chain simulation ........................................ 41 Figure 14. Transit Bus Unmanaged Charging Load (Summer Week) ............................................................ 42 2021 Energy and Environmental Economics, Inc. Arizona Statewide Transportation Electrification Plan ii Figure 15. Transit Bus Managed Charging Load (Summer Week) ................................................................ 43 Figure 16. Statewide Air Quality Net Benefits of EV Adoption by Vehicle Segment for the Low Adoption Scenario. Uncertainty ranges reflect the high and low estimates that are output by the EPA air quality impacts tool, COBRA. .................................................................................................... 46 Figure 17. Average lifetime costs and benefits for a single personal LDV under an unmanaged charging scenario and the medium adoption forecast in APS service territory. ..................................... 48 Figure 18. Average lifetime costs and benefits for a single personal LDV under a managed charging scenario and the medium adoption forecast in APS service territory. ..................................... 49 Figure 19. Average lifetime costs and benefits for a single transit bus under an unmanaged charging scenario and the medium adoption forecast in APS service territory. ..................................... 50 Figure 20. TE Provides Net Benefits to Drivers, Utility Ratepayers, and Arizona with faster adoption leading to higher benefits. .................................................................................................................... 51 Figure 21. GHG reduction potential from electrifying non-modeled MDV vehicles. ................................... 54 Figure 22. GHG reduction potential from electrifying non-modeled HDV vehicles. .................................... 54 Figure 23. Annual Battery Electric Vehicle and Plug-in Hybrid Electric Vehicle Sales in Arizona. 2020 sales were lower due to the economic impact of COVID-19. ........................................................... 8-1 Figure 24. BNEF forecast of upfront EV prices, before incentives, suggests price parity with ICE vehicles by 2025