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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--President-elect Joe Biden is expected to bring a greener hue to federal energy and environmental policy, judging from his campaign pledges and his cabinet nominees for the departments of Energy and Transportation. Though there are many questions as to how Biden's team will make its mark on energy and environmental policies, electric vehicles (EVs) is one industry segment expected to benefit from the new administration's policies and proclivities.
As a presidential candidate, Biden pledged to decarbonize the economy in an effort to limit the buildup of heat-trapping gases such as carbon dioxide (CO2) and head off global climate change. The Environmental Protection Agency (EPA), under administrator-nominee Michael Regen, presumably will take the lead in rolling back a loosening of power plant emissions rules enacted by the Trump administration. As a candidate, Biden pledged to zero out carbon emissions from the Power sector by 2035, and achieve a net-zero emissions economy by 2050.
To make progress toward a net-zero emissions economy, Biden also will need to reduce car and truck tailpipe emissions. Transportation, along with the power and agricultural sectors, account for the largest shares of CO2 emissions.
Candidate Biden pledged to "reduce greenhouse gas emissions from transportation" by, among other things, "developing rigorous new fuel economy standards aimed at ensuring 100% of new sales for light- and medium-duty vehicles will be electrified, and annual improvements for heavy duty vehicles." He also promised to "use the federal government procurement system -- which spends $500 billion every year -- to drive towards 100% clean energy and zero-emissions vehicles."
Those campaign vows will be implemented by Biden's Department of Transportation (DOT), whose secretary-nominee, former South Bend, Indiana, mayor Pete Buttigieg, has expressed a willingness for far-ranging fixes to the nation's infrastructure: investing in the nation's roads and bridges and reducing emissions from the vehicles that use them.
The DOT is responsible for administering the nation's Corporate Average Fuel Economy (CAFE) vehicle mileage standards. Sibling executive-branch agencies like the EPA, the Department of Energy (DOE) and the Council on Environmental Quality (CEQ) are expected to meaningfully contribute to an increase in CAFE standards.
Jennifer Granholm, former governor of Michigan, is Biden's choice to lead the DOE. She has deep experience working with automakers, one of Michigan's most important industries, and she is an EV fan as well.
Biden's cabinet nominees still have to be confirmed by the U.S. Senate. The likelihood of successful confirmations increased after Democrats picked up two Senate seats following runoff elections in Georgia last week.
Industrial Info is tracking 10 proposed lithium-ion battery manufacturing projects that are being actively developed in the U.S. The total investment value (TIV) of these facilities is about $2.9 billion.
"It is more than likely that all 10 of those projects will get built, and I expect more to be added over the next two years," said David Pickering, Industrial Info's vice president of research for Industrial Manufacturing. "I expect new project activity will be a trickle to start, and it may become a stampede."
One of the challenges facing EVs, Pickering said, is that China "owns the lithium-ion battery market, and you don't want to be dependent on China for something as vital as your automotive segment."
Expanding the nation's use of cleaner transportation is a classic chicken-and-egg challenge, he continued. "It's all about infrastructure and having a broad range of vehicles the public wants to purchase. If you look at the nation's charging station network, most of it is clustered along the West and East coasts, and along major east-west federal highways."
Pickering added that trucks account for roughly 70% of the new vehicles sold each year, and most of those trucks are used in construction, agriculture and ranching. "Those trucks are used all day long, every day," Pickering said. "They are worked hard, which is why they are traded in after about a year. You can't have a truck run out of power at 2:00 in the afternoon, halfway through the work day when workers are in the field."
Another challenge to broader use of EVs is their sticker price, he said: "To achieve broad acceptance, EVs need to be priced in the $20,000 to $25,000 range. Tesla has made a lot of progress in bringing down costs and prices, but there's still a long way to go."
"Until we solve these problems--batteries, vehicle models, and charging infrastructure--EV growth won't happen as rapidly as its supporters want."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
As a presidential candidate, Biden pledged to decarbonize the economy in an effort to limit the buildup of heat-trapping gases such as carbon dioxide (CO2) and head off global climate change. The Environmental Protection Agency (EPA), under administrator-nominee Michael Regen, presumably will take the lead in rolling back a loosening of power plant emissions rules enacted by the Trump administration. As a candidate, Biden pledged to zero out carbon emissions from the Power sector by 2035, and achieve a net-zero emissions economy by 2050.
To make progress toward a net-zero emissions economy, Biden also will need to reduce car and truck tailpipe emissions. Transportation, along with the power and agricultural sectors, account for the largest shares of CO2 emissions.
Candidate Biden pledged to "reduce greenhouse gas emissions from transportation" by, among other things, "developing rigorous new fuel economy standards aimed at ensuring 100% of new sales for light- and medium-duty vehicles will be electrified, and annual improvements for heavy duty vehicles." He also promised to "use the federal government procurement system -- which spends $500 billion every year -- to drive towards 100% clean energy and zero-emissions vehicles."
Those campaign vows will be implemented by Biden's Department of Transportation (DOT), whose secretary-nominee, former South Bend, Indiana, mayor Pete Buttigieg, has expressed a willingness for far-ranging fixes to the nation's infrastructure: investing in the nation's roads and bridges and reducing emissions from the vehicles that use them.
The DOT is responsible for administering the nation's Corporate Average Fuel Economy (CAFE) vehicle mileage standards. Sibling executive-branch agencies like the EPA, the Department of Energy (DOE) and the Council on Environmental Quality (CEQ) are expected to meaningfully contribute to an increase in CAFE standards.
Jennifer Granholm, former governor of Michigan, is Biden's choice to lead the DOE. She has deep experience working with automakers, one of Michigan's most important industries, and she is an EV fan as well.
Biden's cabinet nominees still have to be confirmed by the U.S. Senate. The likelihood of successful confirmations increased after Democrats picked up two Senate seats following runoff elections in Georgia last week.
Industrial Info is tracking 10 proposed lithium-ion battery manufacturing projects that are being actively developed in the U.S. The total investment value (TIV) of these facilities is about $2.9 billion.
"It is more than likely that all 10 of those projects will get built, and I expect more to be added over the next two years," said David Pickering, Industrial Info's vice president of research for Industrial Manufacturing. "I expect new project activity will be a trickle to start, and it may become a stampede."
One of the challenges facing EVs, Pickering said, is that China "owns the lithium-ion battery market, and you don't want to be dependent on China for something as vital as your automotive segment."
Expanding the nation's use of cleaner transportation is a classic chicken-and-egg challenge, he continued. "It's all about infrastructure and having a broad range of vehicles the public wants to purchase. If you look at the nation's charging station network, most of it is clustered along the West and East coasts, and along major east-west federal highways."
Pickering added that trucks account for roughly 70% of the new vehicles sold each year, and most of those trucks are used in construction, agriculture and ranching. "Those trucks are used all day long, every day," Pickering said. "They are worked hard, which is why they are traded in after about a year. You can't have a truck run out of power at 2:00 in the afternoon, halfway through the work day when workers are in the field."
Another challenge to broader use of EVs is their sticker price, he said: "To achieve broad acceptance, EVs need to be priced in the $20,000 to $25,000 range. Tesla has made a lot of progress in bringing down costs and prices, but there's still a long way to go."
"Until we solve these problems--batteries, vehicle models, and charging infrastructure--EV growth won't happen as rapidly as its supporters want."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
