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Draft: Assessment of Carb's DRAFT: ASSESSMENT OF CARB’S ZERO-EMISSION VEHICLE PROGRAMS PER SENATE BILL 498 December, 17 2019 This page intentionally left blank. ii This report can be viewed at: https://ww2.arb.ca.gov/legislatively-mandated-reports. To order a hard copy of this report, please contact David Ernest García, Ph. D., Legislative Director, at (916) 322-8520 or [email protected] This document has been reviewed by the staff of the California Air Resources Board and approved for publication. Approval does not signify that the contents necessarily reflect the views and policies of the California Air Resources Board, nor does the mention of trade names or commercial products constitute endorsement or recommendation for use. iii This page intentionally left blank. iv Table of Contents ACRONYMS ............................................................................................................... i EXECUTIVE SUMMARY ............................................................................................ iii CHAPTER 1: INTRODUCTION ............................................................................... 1 CHAPTER 2: WHY ZERO-EMISSION VEHICLES ARE IMPORTANT ..................... 3 CHAPTER 3: STATE OF THE ZEV MARKET ........................................................... 7 CHAPTER 4: OVERVIEW OF CARB’S ZERO-EMISSION VEHICLE PROGRAMS 10 CHAPTER 5: COSTS AND BENEFITS OF CARB’S ZEV PROGRAMS ................. 34 CHAPTER 6: COMPARISON WITH OTHER STATES’ AND COUNTRIES’ PROGRAMS ............................................................................................................ 61 CHAPTER 7: LESSONS LEARNED ........................................................................ 82 CHAPTER 8: POLICY RECOMMENDATIONS TO ACCELERATE ZEV ADOPTION AND IMPROVE ZEV PROGRAMS ..................................................... 97 CHAPTER 9: RECOMMENDATIONS FOR FLEETS TO INCREASE ZEVS ........ 115 APPENDICES Appendix A: Text of SB 498 Appendix B: CARB’s Zero-Emission Vehicle Programs Appendix C: Quantification Methodologies Appendix D: California’s Zero-Emission Vehicle Programs v ACRONYMS AB – Assembly Bill BEV – Battery electric vehicle BEVx – Battery electric vehicle with range extender CARB – California Air Resources Board or Board CO2 – Carbon dioxide CO2e – Carbon dioxide equivalent CVRP – Clean Vehicle Rebate Project DCFC – Direct current fast charger DPM – Diesel particulate matter ePTO – electric power takeoff eVMT – electric vehicle miles traveled EVSE – Electric vehicle supply equipment EVSP – Electric vehicle service provider FCEV – Fuel cell electric vehicle FPL – Federal Poverty Level FY – Fiscal year GHG – greenhouse gas HVIP – Hybrid and Zero-Emission Voucher Incentive Program kWh – kilowatt hour LCFS – Low Carbon Fuel Standard i NOx – Nitrogen oxides PHEV – Plug-in hybrid electric vehicle PM 2.5 – particulate matter smaller than 2.5 micrometers or fine particulate matter ROG – Reactive organic gases SB – Senate Bill TRU – Transport refrigeration unit TNC – Transportation network company VMT – Vehicle miles traveled ZEV – Zero-emission vehicle ii EXECUTIVE SUMMARY Senate Bill (SB) 498 (Skinner, Chapter 628, Statutes of 2017) directs the California Air Resources Board (CARB) to review its programs that affect the adoption of light-, medium-, and heavy-duty zero-emission vehicles (ZEVs), including identifying each program’s goals and status in meeting those goals, performing a cost-benefit analysis, and comparing CARB’s ZEV programs with those of other jurisdictions. SB 498 also directs CARB to make policy recommendations for increasing the use of ZEVs in the State, and recommendations for vehicle fleet operators to increase the use of ZEVs. This report responds to that legislative direction. Transitioning the transportation sector to zero-emission technology is critical to achieving California’s public health protection goals, minimizing air pollution exposure, and mitigating climate change impacts.1 The transportation sector is responsible for the vast majority of the State’s emissions of toxic diesel particulate matter and regional 1 smog-forming oxides of nitrogen (NOX), and is the largest source of greenhouse gas (GHG) emissions.2 Over 12 million Californians breathe unhealthy air, and several areas of the State are still in non-attainment for ozone. Exposure to ozone and particulate matter leads to a range of respiratory and cardiovascular health impacts, including exacerbations of asthma and heart disease, and is estimated to contribute to approximately 7,500 premature deaths in California, and millions globally, each year.3 While significant improvements have been made in both the South Coast Air Basin and the San Joaquin Valley, these areas still represent the greatest challenges to meeting our air quality goals. California is already experiencing significant and widespread impacts on its economy and environment as a result of climate change, such as more severe and frequent heat waves, droughts, flooding, sea-level rise, and wildfires, and these are expected to worsen.4 California has sensible and far reaching goals to mitigate these impacts– including a reduction of Statewide GHG emissions 40 percent below 1990 levels by 1 CARB, 2016. Mobile Source Strategy, https://www.arb.ca.gov/planning/sip/2016sip/2016mobsrc.pdf. 2 CARB, 2019. 2019 Edition, California Greenhouse Gas Emission Inventory: 2000 – 2017, https://www.arb.ca.gov/cc/inventory/pubs/reports/2000_2016/ghg_inventory_trends_00-16.pdf. 3 CARB, 2017. Revised Proposed 2016 State Strategy for the State Implementation Plan, https://ww3.arb.ca.gov/planning/sip/2016sip/rev2016statesip.pdf. 4 Bedsworth et al., 2018. California’s Fourth Climate Change Assessment, Statewide Summary Report. http://www.climateassessment.ca.gov/. iii 20305 and carbon neutrality by 20456–and meeting those goals will require that the transportation sector transforms to zero-emission technology rapidly. California’s Mobile Source Strategy,1 State Strategy for the State Implementation Plan,7 and Scoping Plan8 lay out the measures needed to put California on track to attain the national ambient air quality standards, reduce air pollution-related health impacts, and meet our climate goals. These plans underscore the fact that penetration of ZEV technology throughout the transportation sector is critical. Currently, California’s efforts to transition to a clean transportation system are under attack by federal backsliding on vehicle emissions, which threatens to undermine California’s momentum on ZEVs. This report outlines areas of opportunity to grow California’s ZEV market in spite of this federal threat. Future work, notably the carbon neutrality study being developed by the California Environmental Protection Agency, will identify additional strategies to achieve carbon neutrality for the transportation sector, and may identify additional strategies to accelerate the transition to zero-emission vehicles.9 Policy Recommendations Governor Newsom recently issued Executive Order N-19-1910 that outlines a number of actions that California State agencies must take to reduce GHG emissions. Implementation of that Executive Order is critical in order to keep California on the path to meet our ambitious climate goals. This report identifies eight policy areas to increase ZEV adoption and use, which support that Executive Order, and would either require or benefit from legislative action. These policy recommendations build on actions identified in ZEV Action Plans11, 12, 13 and CARB staff’s report that identified barriers that low-income Californians face in accessing zero-emission transportation options “Low-Income Barriers Study, Part B: Overcoming barriers to Clean 5 SB 32 (Pavley, Chapter 249, Statutes of 2016). 6 Executive Order B-55-18. September 10, 2018. https://www.ca.gov/archive/gov39/wp- content/uploads/2018/09/9.10.18-Executive-Order.pdf. 7 CARB, 2017. Revised Proposed 2016 State Strategy for the State Implementation Plan, https://ww3.arb.ca.gov/planning/sip/2016sip/rev2016statesip.pdf. 8 CARB, 2017. November 2017. “California’s 2017 Climate Change Scoping Plan.” https://ww3.arb.ca.gov/cc/scopingplan/scoping_plan_2017.pdf. 9 California Environmental Protection Agency, 2019. Carbon Neutrality Studies: Vehicle Emissions and Fossil Fuel Demand and Supply. https://calepa.ca.gov/climate/carbon-neutrality-studies/ 10 Executive Order N-19-19. September 20, 2019. https://www.gov.ca.gov/wp-content/uploads/2019/09/9.20.19- Climate-EO-N-19-19.pdf. 11 Governor’s Interagency Working Group on Zero-Emission Vehicles, 2013. February 2013. “2013 ZEV Action Plan: A Roadmap Toward 1.5 Million Zero-Emission Vehicles.” http://opr.ca.gov/docs/Governors_Office_ZEV_Action_Plan_(02-13).pdf. 12 Governor’s Interagency Working Group on Zero-Emission Vehicles, 2016. October 2016. “2016 ZEV Action Plan: An Updated Roadmap Toward 1.5 Million Zero-Emission Vehicles on California Roadways by 2025.” https://www.ca.gov/archive/gov39/wp-content/uploads/2018/01/2016_ZEV_Action_Plan-1.pdf. 13 Governor’s Interagency Working Group on Zero-Emission Vehicles, 2018. September 2018. “2018 ZEV Action Plan: Priorities Update.” http://business.ca.gov/Portals/0/ZEV/2018-ZEV-Action-Plan-Priorities-Update.pdf. iv Transportation Access for Low-Income Residents,”14 and are informed by the review of CARB programs and comparison with other jurisdictions. These policy recommendations are meant to grow the ZEV market through: 1) Incentives and pricing strategies, 2) Lower fuel costs, 3) ZEV refueling infrastructure, 4) Local policies,
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