California Legislature Fueling the Future of Electric Vehicles

By: Matthew Madden The Obama administration’s well-publicized goal of 1M electric vehicles on U.S. roads by the year 2015 is heavily dependent upon the adoption rate of such vehicles in California – an assertion supported by a variety of studies from various stakeholders. The California Energy Commission estimates 1.5M electric vehicles could be on state roads by 2020. Additionally, a recent study published by Pike Research determined that Los Angeles will lead the way in the purchase of electric vehicles from both fleet and consumer perspectives. The same study found that three California municipalities – Los Angeles, San Francisco and San Diego – rank in the nation’s top six cities in terms of both current and future electric vehicle acceptance. It’s fair to say that as goes California, so goes the nation. Last week, the state legislature quietly made incremental progress to ensure California fulfills the ambitious goal of becoming the country’s leader in this emerging industry. The state Assembly passed AB 631 – a bill that stipulates that an entity providing electricity as fuel for light-duty electric vehicles will not be regulated as a public utility. The impetus of the bill, authored by Fiona Ma, is an earlier decision by the California Public Utilities Commission. AB 631 provides “market certainty” by extending the CPUC decision into law. A precedent for both the PUC decision and the state bill exists in the alternative fuel arena as the CPUC and state legislature followed a similar path with regard to Compressed Natural Gas. The practical implications of the bill are particularly relevant to the emerging electric vehicle infrastructure industry - often referred to as EVSE (electric vehicle supply equipment). California-based companies such as Coulomb Technologies, Ecotality and Aerovironment are selling electric vehicle charging stations to a wide variety of customers including municipalities, corporations for campus use and retailers. Critically, the business model of these charging and infrastructure companies is reliant upon their ability to deploy charging stations – and develop compelling business models – in a wide variety of situations. If municipalities, corporations and retailers are relieved of the bureaucratic hassle of meeting stringent regulatory requirements – requirements designed to influence the behavior of large volume energy generation, transmission and distribution utilities, not small volume energy providers – this will encourage the deployment of electric vehicle charging stations and infrastructure in a variety of settings to meet the fueling demands of drivers. Conveniently, that’s exactly what the state and the nation need in order to spur continued adoption of electric vehicles and ease the often-discussed range anxiety associated with electric vehicles. Since the bill has passed the Assembly, AB 631 now goes to the Senate where the Energy, Utilities and Commerce Committee is expected to take up the issue next month. Given the resounding endorsement it received last week – the bill passed unanimously – advocates are hopeful that the bill will become law later this year. The 63-0 vote in the Assembly does demonstrate the bipartisan attractiveness of electric vehicles and the required infrastructure. Whether the motivation is climate change or national security, energy efficiency or the reduction of imports from foreign oil producers, both sides of the aisle are in agreement that encouraging the transition to a transportation sector reliant upon electricity and battery technology is a positive development. It’s under-publicized, but vital, legislation such as AB 631 that will fuel the future of electro-mobility.