27 Jun Difficulty of Local Government Vehicle Electrification
In the last blog, we covered the 27 North Carolina local governments that have adopted a 100 percent renewable energy resolution. There are many strategies to achieve this goal and vehicle electrification is undoubtedly a key one. In fact, Governor Cooper’s Executive Order 80 sets a goal of at least 80,000 zero emission vehicles in North Carolina by 2025. So, there is a huge push to electrify transportation and take advantage of the benefits: reduced greenhouse gas emissions, support of clean energy jobs, and lower maintenance costs over the life of the vehicle. Why, then, does it seem so hard to accomplish? In conversations with people around the state, its difficulty seems to be the universal response.
Diane Cherry explored EV electrification challenges for North Carolina local governments. For a client project, she completed a survey of local government fleet managers and asked them to identify electrification obstacles. Cost and budget were the number one problem. North Carolina has access to the VW Settlement funds to help local governments with those costs, but it has been delayed because of an ongoing debate over who has control of the purse strings (the Governor or the N.C. General Assembly). The $92 million is available, but Phase 1 funds have not been disbursed.
If cost and budget cannot be eased with the VW Settlement funds, and the pandemic has reduced local government sales tax revenue by 20 percent, what should jurisdictions do in the interim, especially as their renewable energy resolutions loom large?
Fleet managers must analyze their operational needs and develop a written plan for how and where electric vehicles might fit. Without a plan, conventional vehicles will remain part of the vehicle stock longer than needed, and vehicle turnover is slow regardless of which vehicles are chosen.
The fleet services manager, in partnership with city department heads, should begin outlining whether EVs are feasible with positions that require transportation. For example: a police vehicle take-home program may not work with electric vehicles if officers do not have residential charging. On the other hand, city inspectors who travel throughout the city jurisdiction and return to the motor pool each afternoon may be ideal for an electric vehicle.
Once it has been decided which positions could use an EV, questions arise such as: whether the vehicles need to be fully charged at the end of the day. Will they be charging at the same time of day or will they be returning to the motor pool at different times and charge throughout the day?
Infrastructure considerations come up such as what is needed for the fleet now and in the future? Are electrical upgrades needed? How can you plan for energy management so demand charges are minimized or eliminated altogether? Infrastructure planning, negotiating, funding, permitting, installation, and certification may take much longer to plan than procuring the vehicles. An operational plan though, should account for all of these issues.
After determination of how many EVs, what positions will be filled, and how they will be used, procuring the vehicles is the next step. But what kind of EV and payment schedule is best to purchase – a new one, a used one, or one that is leased? What are the trade-offs? The local government fleet survey showed complications with all of the available choices.
Prices of electric vehicles have plummeted. Batteries are the single most expensive component in an electric car, but prices of lithium-ion batteries have dropped about 20 percent from 2019, and are about 89 percent lower than a decade ago. We may in fact reach price parity of conventional vehicles and EVs between 2024 and 2029. At the same time, the used EV market is now flooded with Nissan Leafs and Chevy Bolts, all between $10-$15K, as more and more people buy new EVs. Leasing is also an option, and it makes monthly expenditures more affordable while keeping up with the latest technology. But federal tax credits accrue to the leasing company and would not be available to the city or county.
Local governments must communicate across the organization with training and support when EVs are rolled out. Unfortunately, only 40 percent of the local government jurisdictions responding in the client survey reported having a cross-functional team to provide guidance, making success more difficult by placing responsibility squarely on the shoulders of the fleet manager.
EV understanding is a critical precursor to its support. Awareness activities, including online informational materials and outreach, help to increase familiarity and general understanding of electric vehicles and their features. Outreach events are an effective way to raise awareness and increase familiarity. National Drive Electric Week is one of the largest initiatives that many local governments participate in or support.
The transition to vehicle electrification requires careful consideration of operational considerations, the types of vehicles, and organizational support. It is occurring throughout the country in local communities as situations allow. While the funding challenges remain with the pandemic and the VW Settlement funds, carefully made plans now ensure success when funding does come.
If you’d like to learn more what steps we’re taking in the push for government EV transitions, please contact Diane Cherry directly by clicking here.