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Last year, 15 states and the District of Columbia agreed to increase the use of zero-emissions vehicles in their medium- and heavy-duty fleets.

State Lawmakers Driving EV Policies in 2021

By Laura Shields | March 26, 2021 | State Legislatures News

To support transportation electrification, many state legislatures are taking an all-hands-on-deck approach, with policies to encourage electric vehicle adoption and to build out the charging infrastructure necessary to power the growing number of EVs on the road. They’re also continuing to explore EV fee policies to address declining gas tax revenues caused, in part, by the increasing fuel efficiency across the U.S. vehicle fleet.

Many of the EV policies legislatures are weighing this year have been considered in prior sessions, including bills related to zero-emission vehicle (ZEV) requirements, financial incentives that encourage EV adoption and the construction of charging systems, electrifying private and public fleets, expanding infrastructure development, and EV fees.

As some states wrap up their current legislative sessions, here are some of the most popular EV policy topics and examples of bills that have been passed by one chamber or enacted in 2021.

State Clean Car Programs

State clean car programs—requiring that a certain percentage of new vehicle sales in a state be EVs or other zero-emission vehicles—are considered a key regulatory tool driving adoption of fuel efficient and electric vehicles. Twelve states—Colorado, Connecticut, Maine, Maryland, Massachusetts, New York, New Jersey, Oregon, Rhode Island, Vermont, Virginia and Washington—have adopted California’s low-emission vehicle and zero-emission vehicle regulations for light-duty vehicles, with Washington enacting legislation in 2020 and Virginia in 2021.

Recent State Action:
  • Virginia HB 1965 (enacted) directs regulators to adopt a state clean car program in alignment with California’s vehicle emissions standards under section 177 of the Clean Air Act. The state’s program would include both the low-emission vehicle and zero-emission vehicle requirements and apply to vehicle model years 2025 and later. Additionally, the bill authorizes regulators to “adopt by regulation and enforce any model year standards relating to the control of emissions from new motor vehicles or new motor vehicle engines,” creating broad legal authority for the state’s adoption of emission standards beyond the LEV and ZEV requirements.

Financial Incentives

States continue to weigh policies that offer financial incentives to encourage EV adoption and charging infrastructure deployment. Forty-five states and the District of Columbia provide incentives ranging from tax credits and rebates to emissions testing exemptions and utility time-of-use rate reductions. In crafting such policies, a growing number of states also are including provisions that expand access to EV technologies in low-income and disadvantaged communities.

Recent State Action:
  • Virginia recently passed HB 1979 (awaiting governor’s signature), creating an EV rebate program that applies to new and used vehicles. Buyers purchasing or leasing an EV would be eligible for a rebate of $2,500 at the time of purchase, with an additional $2,000 rebate toward a new EV and $500 toward a used EV available for customers with incomes at or below 300 percent of the federal poverty level.
  • Hawaii SB 932 (pending) would amend the state’s green infrastructure loan program requirements to allow funds to be used to buy or lease EVs and to install EV charging systems.

Infrastructure Development

States are also considering policies that support building out a robust charging network to accommodate the growing number of EVs on U.S. roadways. These policies encourage investment in EV charging infrastructure and remove barriers that can hamper development.

Recent State Action:
  • Hawaii HB 1142 (pending) would impose a fee on gasoline-powered vehicles with a retail price of $60,000 or more to fund the installation of EV charging infrastructure.
  • Massachusetts enacted a transportation funding bill (HB 5248) that includes funding for grants to localities and regional transit authorities for installing EV infrastructure and purchasing light-, medium- and heavy-duty EVs and zero-emission vehicles.
  • Oregon SB 314 (pending) would authorize the PUC to allow electric and natural gas utilities to recover costs from customers for certain prudent investments in advancing transportation electrification.
  • Virginia also sent a handful of bills related to EV infrastructure to the governor’s desk for signature. Among them are HB 2001, requiring that certain new state and local government buildings be equipped with EV charging stations, and SB 1223, requiring an analysis of the state’s EV infrastructure needs to support its target of net-zero carbon emissions in the transportation sector by 2045.

Medium- and Heavy-Duty Vehicles

States are looking to go beyond electrifying light-duty vehicles by including medium- and heavy-duty vehicles in their EV policies. In July 2020, 15 states—California, Colorado, Connecticut, Hawaii, Maine, Maryland, Massachusetts, North Carolina, New York, New Jersey, Pennsylvania, Oregon, Rhode Island and Vermont, and Washington—and the District of Columbia signed a multistate agreement to increase ZEVs in the medium- and heavy-duty sector. The agreement commits participating jurisdictions to achieving ZEV sales targets for new medium- and heavy-duty vehicles of 30% by 2030 and 100% by 2050. In addition to these commitments, states are considering targeted legislation aimed at deploying more ZEV medium- and heavy-duty vehicles.

Recent State Action:
  • Hawaii HB 552 (pending) would require that agencies purchasing or leasing medium- and heavy-duty vehicles prioritize electric and alternative fuel vehicles.
  • Utah HB 91 (awaiting governor’s signature) would create a tax credit for alternative fuel heavy-duty vehicles, including those fueled by natural gas and those with a 100% electric or hydrogen-electric drivetrain.
  • Virginia’s HB 2118 (awaiting governor’s signature), in addition to providing grants for EV charging, establishes grants to help public schools replace diesel buses with their electric counterparts.

Fleets

Most states require that alternative fuel, electric and zero-emission vehicles be incorporated into state government fleets. While legislatures continue to enact public fleet policies, they are also starting to set requirements for private fleets, including transportation network companies and rental cars.

Recent State Action:
  • Hawaii SB 768 (pending) would form a task force to help transition the private rental vehicle fleet toward electrification. The task force would form a plan to build out the charging infrastructure necessary to support a rental vehicle fleet comprising 100% zero-emission vehicles by 2035. Also being considered are SB 920 (pending), which would require that the light-duty vehicles in the state’s fleet be 100% ZEVs by the end of 2030, and HB 552 (pending), which would require that 100% of the state’s light-duty vehicles “be powered by renewable energy sources by the end of 2035.”

Fees

To make up declining gas tax revenues, many states have enacted fees on electric or hybrid vehicles, or both, that range from $50 to over $225. Twenty-eight states have laws requiring a special registration fee for plug-in electric vehicles. Of those states, 14 also assess a fee on plug-in hybrid vehicles. These fees are typically in addition to traditional motor vehicle registration fees. Supporters of the fees say they bring equity among drivers by ensuring all drivers pay for using roadways. This year, some states are weighing or amending EV fee policies, while others are considering different funding mechanisms to address lower gas tax revenue, such as road usage charge (RUC) programs.

Recent State Action:
  • Arizona SB 1108 (pending) would impose a tax on alternative-fuel vehicles, including those powered by electricity, natural gas and propane.
  • Arkansas SB 246 (enacted) exempts military personnel and veterans with special license plates from having to pay the state’s additional fees for EVs or hybrid vehicles. SB 225 (enacted) distinguishes between plug-in electric hybrid (PHEV) and hybrid vehicles under the state’s fee requirements, maintaining a fee of $100 for PHEVs and lowering the fee to $50 for other hybrid vehicles.
  • Montana HB 188 (pending) would establish an additional fee of $150 and $250 for light- and heavy-duty EVs respectively.
  • Utah SB 82 (awaiting governor’s signature) would establish the Road Usage Charge Program Special Revenue Fund within the state transportation fund to cover the costs of administering the RUC program.

Laura Shields is a policy associate in NCSL’s Energy Program.

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