The California Air Resources Board Aug. 25 adopted new regulations allowing the state to phase out gasoline-powered vehicles by 2035, a move Platts Analytics said could displace 535,000 b/d of gasoline in a state that accounts for nearly 20% of US finished gasoline demand.
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The Advanced Clean Cars II regulations now move to the California Office of Administrative Law for approval and then to the US Environmental Protection Agency for final signoff as a revision to the state's plan for implementing the Clean Air Act. Other states that often follow California's lead on car regulations will also decide whether to take up the new rules, potentially expanding the impact.
The measure adopted puts into motion Governor Gavin Newsom's 2020 executive order effectively banning the sale of gasoline-powered cars after 2035. It requires car manufacturers to make available increasing percentages of zero-emission vehicles from model years 2026 through 2035, culminating with nearly 100% sales of ZEVs and green plug-in hybrid electric vehicles.
Transportation is the largest source of greenhouse gas emissions in California, with some 70% of the sector's emissions coming from passenger vehicles.
Fuel, electricity impacts
Platts Analytics' Matthew Williams found that the on-road internal combustion engine fleet could be reduced by almost 5 million vehicles by 2035 if the 100% ZEV sales target is reached, compared with Platts Analytics' current reference case.
"Under this ICE ban scenario, the EV fleet would not reach over 50% until 2035," Willians said. "Gasoline displacement would increase 40% in 2035 to 535,000 b/d."
While EV uptake will reduce covered emissions from the transportation section, particularly from passenger vehicles, "it will add additional strain to the California power grid," he added.
Platts Analytics expects California's total vehicle fleet in 2035 to include nearly 14.3 million EVs, for which approximately 44 TWh of generation would be required.
CARB is relying heavily on the California Low Carbon Fuel Standard to meet the state's emissions reduction goals. Under that program, electricity has already surged to the second leading credit generator, overtaking ethanol, though both still pale in comparison to renewable diesel, according to Jamie Dorner, also with Platts Analytics.
"The ICE ban will see an increase in electric vehicles, which CARB will most certainly take into consideration when updating the design of the LCFS program, expected later this year in Q4," Dorner said.
California's rules go beyond President Joe Biden's goal of having EVs account for 50% of new vehicle sales by 2030. And the regulations are also getting pushback.
The EV market share in California is currently around 18% and is leading the nation which stands at 6.3%.
"Despite this positive trend, California's EV sale mandates are still very aggressive – even in California with decades of supportive EV policies – and will be extremely challenging," John Bozzella, president and CEO of the Alliance for Automotive Innovation, said in an email.
"Whether or not these requirements are realistic or achievable is directly linked to external factors like inflation, charging and fuel infrastructure, supply chains, labor, critical mineral availability and pricing, and the ongoing semiconductor shortage," he asserted. "These are complex, intertwined and global issues well beyond the control of either CARB or the auto industry."
Bozzella reiterated his call for policymakers to ensure that efforts to get more EVs on the road go hand-in-hand with the policies necessary to advance the transition to EVs.
Others, however, embraced the landmark regulations.
Bob Holycross, chief sustainability officer at Ford Motor Co., boasted about the company's partnership with California to strengthen vehicle emissions standards.
"We're committed to building a zero-emissions transportation future that includes everyone, backed by our own investments of more than $50 billion by 2026 in EVs and batteries," he said.
Maximizing sales, quality
The regulations also include new light-duty vehicle standards to reduce tailpipe emissions during aggressive driving and cold-starts and better emission controls on medium-duty vehicles. Further, car manufacturers would have to meet criteria emission fleet average requirements without including ZEVs.
With an eye on not only maximizing the sales volume of ZEVs but their quality as well, there are also a suite in provisions in the new car rules establishing minimum technical requirements and assurance measures for these vehicles. Those provisions include warranty, durability, serviceability, streamlined charging and battery labeling requirements to ease consumers' transition to EVs.
Other measures to address consumer concerns about going electric involve range requirements of at least 150 miles with retention of that range for at least 10 years; measures to ensure consumers maintain choices when it comes time to seek auto repairs; and initiatives to encourage discounts and lower prices to help low-income and disadvantaged households procure ZEVs.
CARB staffer Anna Wong, during the board meeting considering the regulation, said the rules were poised to reduce GHG emissions from passenger vehicles by more than 50% by 2040 and to lower smog-forming emissions from passenger vehicles by more than 25% by 2037.
She also pointed to consumer savings of as much as $7,900 in the first 10 years.