The oil industry against the electric car

The oil industry is trying to crush the burgeoning movement of the electric car.

Groups backed by industry giants like Exxon Mobil and the Koch empire are fighting a multi-million dollar state battle to prevent utilities from building charging stations in the US. across the country. Environmentalists call the fight-resumption fight "Who Killed the Electric Car?" Which condemned an earlier generation of battery-powered vehicles in the 1990s.

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Oil-backed groups have challenged electricity companies' plans in 10 states, according to documents tabled by the public utilities commission and reviewed by POLITICO, which have conducted lobbying campaigns and campaigning campaigns. regulation against proposals. The clash takes place while utilities, wishing to increase the demand for electricity, are asking permission to build charging networks in places such as shopping malls and stopping places. rest in more than half of the country.

"Fossil fuel interests control 90% of the US transportation fuels market and really feel threatened," said Gina Coplon-Newfield, director of the Sierra Club Electric Vehicle Initiative.

The counter-attack involves a range of industry-sponsored trade associations and political groups representing all segments of the oil sector.

In the Midwest, the US Petrochemical and Petrochemical Manufacturers Group, which includes gasoline manufacturers, has made submissions against the Kansas and Missouri indictment plans, and has also made submissions to the United States. is opposed to Colorado's new mandate for zero emission vehicles as part of the "Freedom to Drive" coalition. car dealers and oil companies. Average consumers, they say, should not have to pay for incentives or charging stations that mainly benefit people who are rich enough to pay for cars like Teslas.

"We think we're on the angels' side because we want it to be a free market and we do not want people who do not use the service to pay for the service," said Derrick Morgan, vice President Director. of the fuels and petrochemicals group.

In Illinois and Iowa, the American Petroleum Institute has partnered with Americans for Prosperity – a political group founded by the oil empire Koch – to oppose investments in electric vehicles from service companies public. The owner of a large refinery has partnered with other industrial interests to oppose utility pricing and shared mobility projects in Minnesota.

In Massachusetts, API has teamed up with gasoline distributors and convenience stores to oppose the construction of electric vehicle charging stations by National Grid Utility. The Western States Petroleum Association has opposed Arizona's utility charging regimes alongside AFP, as well as California's electric vehicle legislation. And in Maryland, the API has lined up with convenience stores, gas stations and truck stop owners to oppose utility electric vehicle projects.

Oil groups are far from being the only ones to criticize utility pricing proposals. Consumer advocates and some independent billing companies claim that utilities, which operate as monopolies, are using the electric vehicle infrastructure to clean up their balance sheets, as their captive customers will have to pay for the investments.

Utilities say that the initial cost of the charging stations is minimal for taxpayers and that customer bills may actually drop as the adoption of electric vehicles grows because the cost of charging is high. Power grid infrastructure will be distributed on a larger electricity demand basis. In Maryland, Four power companies proposed the construction of 24,000 chargers last year, at an estimated cost of between 25 and 42 cents per taxpayer per month. The proposal from three Exelon utilities and one from FirstEnergy would have been the largest utility plan outside California, with utilities installing chargers in homes and apartment buildings as well as workplaces and public places such as grocery stores or rest areas.

So far, the oil sector has not been very successful in fighting utility plans. Although US petrol and petrochemical manufacturers celebrated the decision of a Kansas utility to withdraw a load plan last year, analysts say that in most cases, regulators are cutting back on their plans to public service but do not do so in response to petroleum industry demands.

"Until now, the main consequence [of oil lobbying] I've noticed delays, but I think the fight is going on, "said Samantha Houston, an analyst of clean vehicles at the Union of Concerned Scientists. "I would not attribute changes to the electric vehicle programs to API, but they certainly try to blur the waters in their interventions."

In Maryland, regulators have reduced the utility proposal, allowing them to build only 5,000 shippers on public sites in the next few years. But the state's regulator said the decision was largely based on competition and price issues, and the petroleum industry's arguments were underdeveloped.

"Personally, I have not found these compelling arguments," said Jason Stanek, chair of the Maryland Public Service Commission. "There is obviously a push towards the electrification of transport and [these are] parochial concerns pushed by the oil industry to preserve its market share ".

Still, Stanek, Houston and others are waiting for oil companies to continue to fight the growing threat of electric vehicles.

"I think the fight here is likely to last a while," said Houston. "Internal combustion engines still have a fairly large market share and the oil and gas industry does not want it to go anywhere."

The question of whether gasoline vehicles can remain in their market is increasingly uncertain. According to Bloomberg New Energy Finance, electric vehicles could account for up to 40% of the US passenger vehicle fleet and 60% of sales, compared with 2% today. This would wipe out the demand for more than 3 million barrels of oil per day, which is more than 20% of current transportation consumption.

Oil groups are also fighting in Congress to oppose tax credits for electric vehicles, pushing lawmakers to raise rates for electric vehicles – 26 states have them today – and supporting the project dismantling by the Trump administration of the fuel economy standards of the Obama era. Automobile dealers are one of the main business sectors related to the dismantling of President Donald Trump.

The motivation for lobbying stems from an existential threat facing the global oil sector in the face of the rise of the electric vehicle.

Mandates for electric vehicles in China and many other European Union countries are aimed at phasing out gasoline vehicles by 2040 or earlier. This will continue to drive down the price of batteries in the coming years, said David Doherty, Oil Specialist at Bloomberg New Energy Finance. And that, he said, should create a turning point in the middle of the next decade as electric passenger vehicles become more competitive with gasoline vehicles – which means that the oil sector does not have a competitive edge. more than a few years to stem the tide.

"Next, we'll see electric vehicles actually increase as a percentage of sales," Doherty said.

With electric vehicles on the road to competitiveness, the biggest barrier to increased adoption is deploying enough chargers to fuel their growth. This, explains Stanek, helps explain the intensified lobbying campaign of the oil sector.

"People need to see charging stations for electric vehicles and know they exist before buying a vehicle. [electric] vehicle, "said the Maryland regulator, who works in a state where Republican Governor Larry Hogan wants to see 300,000 electric vehicles in 2025, compared with less than 20,000 today. "As more and more drivers see public charging at gas stations, libraries and by the roadside, consumers will have to think twice before buying their next vehicle."

Publicly, both parties are embarrassed by the confrontation. Proponents of oil downplay the threat of electric vehicles, claiming that they are still not as functional as internal combustion engine cars and pointing out that many analysts expect that global demand for fuel Fossils continues to be strong in the middle of the century.

"In fact, I think the internal combustion engine will last a long time, unless there is a major advance in electric vehicle technology that has not yet occurred and that does not seem likely in the future. close, "said Morgan. . "I think that internal combustion engines remain very, very competitive for decades to come."

At the same time, the Edison Electric Institute, an important group in the utility sector, said it was too early to know if electric and gasoline vehicles could collide.

"I do not think it's us and them," said Becky Knox, senior director of EEI. "At this stage of the market, [electric vehicles] are still relatively new. I do not know if it 's a collision. "

Even then, veterans of the electricity sector believe that it is clear that utilities have intensified their lobbying activities in the electric vehicle sector in recent years. While electric vehicle charging was rare outside of California in the mid-decade, more than 50 utility companies in 25 states and the District of Columbia have now offered charging programs. EEI and its members have also lobbied Congress to extend and expand incentives for electric vehicles. They fought directly with the oil companies to defeat the model legislation against utility electric vehicle projects at meetings of business leaders and conservative lawmakers.

"Electricity utilities do not do it out of altruism," said Stanek. "There is an advantage in terms of return by allowing them to [charge ratepayers] for certain vehicle infrastructures. "

Some observers have stated that operators' initial fear of electric vehicles has led power companies to make exaggerated demands to charge taxpayers for the accumulation of charges.

"They have finally managed to overcome the obvious and obvious benefits, and after being recalcitrant, are now reaping incentives and concessions that should not have been needed," said Karl Rábago, former utility regulator in Texas and Senior Policy Advisor at Pace. Center for Energy and Climate. "It feels a bit like a rope-to-dope."

The evolution of public services towards electric vehicles has placed ecological groups in a delicate position: after having fought for years against public services to adopt renewable energies, most have come to consider them as powerful allies to reduce pollution related to transport.

"The Sierra Club has a long and rich history of litigation against opposing utility companies when [they] support fossil fuels, "said Coplon-Newfield. "But with regard to the acceleration of electric vehicles, we actually found a common ground."

Environmentalists say many of the petroleum industry's arguments against electric vehicles are reminiscent of the 1990s, when fossil fuel groups and automakers had successfully led a campaign to reduce California's ambitious mandate for zero-rated vehicles. broadcast – as the popular documentary "Who killed the electric car?"

At the time, California was about to require that an increasing percentage of cars sold in that state be vehicles without gasoline, peaking at 10% in 2003. However, regulators The state's air have given way after a dedicated lobbying campaign of car manufacturers and oil interests. he opposed the charging plans for electric vehicles and said that there was no demand for vehicles.

A key change since then is the position of the automotive sector. American automakers have fought fiercely against California regulations in the past, but they are becoming more receptive to the goals of electric vehicles, especially when they include incentives to purchase vehicles.

Ten more countries are following California 's zero – emission vehicle targets, which now require electric vehicles to account for approximately 8% of new vehicle sales by 2025. Alliance of Automobile Manufacturers, the industry's largest industry group, has signed on to support a zero-emission goal in Colorado, as it provided incentives for the purchase of electric vehicles.

But as in the oil sector, electric vehicles also divide the automotive industry. Automotive dealerships derive a large portion of their revenue from gasoline engine maintenance and publicly oppose electric vehicle and commercial vehicle charging programs in Colorado and elsewhere.

With automakers singing a new tune and the price of electric vehicles continuing to decline, Mr. Stanek said regulators should be ready for the front lines of the battle between utilities and industry oil are soon spreading in their states.

"The oil lobby and the electricity services lobby – I'm talking about API versus EEI – we're going to see a competition between them for a market share like we've never seen before," did he declare.