Create an executive level “charging working group” or “czar” with the Governor’s authority to ensure coordination and hold accountable state agencies responsible for the deployment of charging infrastructure to support the heavy-duty vehicle sector.

The working group or czar could potentially build on the infrastructure strike team already created by Governor Newsom’s executive order in May 2023. This leadership could also potentially come from Senate Bill 934 (Gonzalez), pending in the California Legislature as of June 2024. That bill would create a “Zero-Emission Freight Central Delivery Team” jointly convened by the California Transportation Commission and the Energy Commission, with representatives from various state agencies, in order to ensure statewide coordination of zero-emission freight infrastructure planning and implementation. Ultimately, the working group leader could designate key ownership and leadership roles among lead commissioners from pivotal agencies such as the California Public Utilities Commission (PUC), Energy Commission (CEC), Air Resources Board (CARB), Department of Transportation (Caltrans), and other relevant authorities. These designated leaders would form the core of the working group, convening regularly to evaluate progress, establish priorities, and pinpoint follow-up action required to facilitate deployment.

Make the data on deployment progress publicly available

The working group or czar could prioritize guaranteeing the timely availability of chargers and grid upgrades in accordance with established goals, along with strategic planning to align infrastructure development with the projected timelines in order to avoid delays that might impede progress. To enhance data management and accessibility (as well as transparency and accountability), the working group could establish an online repository of data and information on deployment progress to date, potentially through the California Energy Commission’s beta dashboard displaying all medium- and heavy-duty zero-emission vehicle charging stations in development in California

State agencies could coordinate with each other and with the legislature if necessary to ensure synchronization of available public funding and financing for charging
infrastructure

State agencies responsible for funding or financing charging infrastructure like California Air Resources Board, Energy Commission, Public Utilities Commission, Caltrans could coordinate with each other and with the legislature if necessary to ensure synchronization of available public funding and financing for charging infrastructure. However, participants noted that these agencies
and the timelines they set are not always synchronized, which results in challenges lining up enough funds and financing to deploy necessary infrastructure. The agencies could better coordinate with each other and with the legislature if necessary (if programs and timelines are statutorily determined) to strategically streamline and time financial resources, avoiding fragmentation and maximizing the impact of grants. The availability of grants like the Charging and Fueling Infrastructure Discretionary Grant
Program is a key component in facilitating the development of heavy-duty charging infrastructure.

Utilize current proceedings to require utilities to be more transparent about sources of energization and approval delays

Senate Bill 410 (Becker, Chapter 394, 2023) and Assembly Bill 50 (Wood, Chapter 317, 2023) required the public utilities commission to establish reasonable and maximum energization time periods, along with a procedure for customers to report delays, among other requirements. In response, the commission opened a new proceeding in January 2024 to implement these goals. The public utilities commission could utilize this proceeding to mandate utilities enhance transparency of the sources of energization or approval delays associated with heavy-duty electric vehicle charging projects. Commissioners could require utilities to provide clearer insights into the timelines and factors causing delays in the approval process. This transparency could in turn help address uncertainties that hinder capital investment and streamline the overall deployment of the relevant infrastructure.

Establish an entity to process and
disseminate data on optimal charging locations for planning processes

The California Energy Commission could create an entity to process and collect the data described above, such as detailed energization plans, feasibility assessments, and utility infrastructure, and make it available for planning processes related to the optimal locations for heavy-duty charging infrastructure. By centralizing data collection and
making it available for planning processes, this entity could streamline the information-sharing process, fostering a collaborative environment for efficient decision-making.

Encourage or require utilities to build an equipment bank for needed charging and grid infrastructure (e.g. transformers) to avoid construction delays

With regulator or legislative encouragement or mandates through firm timelines for utilities on improving energization processes, utilities could explore the possibility of pre-purchasing transformers or switchgears, which are often customer-purchased and site-specific items necessary for charger installations. To implement this solution effectively, utilities would need a robust forecasting system to anticipate the demand
for heavy-duty charging infrastructure.

Accelerate heavy-duty electric vehicle charging infrastructure deployment via the Fast-Charging Infrastructure pathway under the state’s low carbon fuel standard

Participants at the convening discussed the importance of ensuring funding for non-grid
charging infrastructure. The California Air Resources Board developed the low carbon fuel
standard (LCFS) program, which requires fuel providers to reduce the carbon content of their fuel or buy credits from low- or zero-carbon fuel providers who have excess credits (for more information on this program, please refer to table 2). The board designed the program to incentivize low carbon transportation fuels, and participants noted that it could serve as a powerful financial incentive to drive investments in heavy duty electric vehicle charging infrastructure without relying on ratepayer dollars.

Seek federal funds for grid upgrades, given the
continued escalation of electricity rates in California

As electricity rates continue to escalate due to multiple factors, California policy makers and utility leaders could increase efforts to seek non-ratepayer sources of funding. Utilities and state agencies could jointly explore federal funding avenues in particular as a means to fill the financial gap hindering deployment of heavy-duty electric vehicle charging infrastructure. By actively seeking support from the Department of Transportation (DOT) or other federal agencies, these stakeholders could secure resources that they can dedicate to upgrading the grid infrastructure.

Pay for grid upgrades through the general fund
or non-traditional sources of existing funding, such as via transportation infrastructure investments

Given rising electricity rates, the legislature could consider financing the necessary grid
upgrades directly from the general fund or greenhouse gas reduction fund (GGRF, funded
by proceeds from the state’s cap-and-trade auction proceeds), particularly when sufficient budget funds exist to allocate. Some of these expenses could be recouped from ratepayer funds, such as public financing of new transmission lines. This approach capitalizes on the economic advantages of public financing, which is often considerably more cost-effective than relying solely on utility finance, potentially alleviating the financial burden on ratepayers.

Modify HVIP incentives to ensure more targeted uptake by fleets more readily able to electrify

CARB could expand the eligibility criteria for HVIP and accommodate emerging technologies. The Legislature could expand HVIP to include incentives for the development of charging infrastructure or emerging technologies such as vehicle-to-grid integration and vehicle sharing platforms that can help further reduce emissions and improve efficiency. As a model that could be expanded to include more funding programs at a bigger scale, the board and the California Energy Commission coordinate on funding HVIP with the energy commission’s EnergIIZE grant program, which provides reimbursement-style grants to infrastructure projects that deploy charging for heavy-duty commercial fleets.

Streamline and accelerate incentive payment processing times

Incentive recipients often face uncertainties regarding payment timing, which significantly impacts their operational activities. To address these issues, agencies like
the California Air Resources Board and Energy Commission that offer incentives and direct payment could streamline their processes by simplifying grant application and
approval procedures. This streamlining could include reducing the number of approval
layers, minimizing paperwork, and expediting compliance checks that often slow down the payment process.

Reduce excise and sales taxes to make zero-emission models more competitive on upfront price with diesel versions

Participants described the challenge of bridging the upfront price gap between zero-emission and diesel-fueled heavy-duty vehicles, with new Class 8 rigid diesel trucks costing roughly $158,000 but new Class 8 rigid electric trucks priced around $270,000. Although the price gap will decrease and operating cost savings can help reduce total cost of ownership over time, some participants wanted Congress (or California leaders to petition Congress) to amend the federal excise tax to reduce it for zero-emission heavy-duty vehicles, at least temporarily until prices decrease.

Develop educational materials for the investor community on heavy-duty electric vehicles and
associated infrastructure

These educational materials include factsheets that are tailored to specific financial
stakeholders, including investors, lenders, financial institutions, and fleet operators.
This outreach work could build off the air resources board’s “ZEV TruckStop” informational website, which contains basic information about zero-emission vehicles. These materials would highlight the environmental, economic, and social benefits of
electric heavy-duty vehicles to dispel myths or address the lack of awareness about the state of the technology and its deployment status.

Share heavy-duty electric vehicle data and assessments with the broader investment community to facilitate more lending

Nonprofits and other entities that interface with the investment community and serve as trusted messengers, such as Ceres, could engage institutional investors, asset managers, and financial institutions to promote heavy-duty electric vehicles and related infrastructure as a viable sustainable investment opportunity, either through direct lending products for vehicle or infrastructure purchases or investment in companies providing these services. They could partner with regional chambers of commerce to co-organize investment summits and roundtable discussions, providing a platform for direct engagement with potential investors.

Participate more meaningfully in this transition by launching funds for heavy-duty electric vehicles and
associated infrastructure to educate and attract other lenders

Large companies with an interest in supporting and expanding heavy-duty electric vehicles and associated infrastructures could launch a fund to help finance this deployment. Potentially modeled on a recent airline-created fund to invest in sustainable aviation fuel, private sector industry leaders could develop a fund exclusively to finance deployment and also educate lenders about the opportunities.

Modify the HVIP incentive to provide a residual value guarantee with a fixed “floor” resale purchase price for heavy-duty electric vehicles, to encourage fleet purchasers to re-sell the vehicles to smaller operators

Such a “fixed floor” would provide financiers with the certainty they need to price the residual value into their lease. As the amount of incentives available for big fleets decreases, participants noted that purchasers could consider the residual values of the vehicles as a financial reassurance. A fixed floor resale price could encourage more fleets to make the transition, which would also help spur the secondary market and allow less-expensive used vehicles to become available on the market sooner for smaller companies and operators.

Modify incentives to encourage truckmakers to lower prices on sales and leases

In order to encourage manufacturers to bring down electric vehicle truck prices, the legislature or board could modify incentives like HVIP to determine eligibility based on the price of the vehicles, similar to how federal tax credits for light duty electric vehicles operate. If incentives are available only for vehicles below a certain price (and not for vehicles above that price), automakers may be encouraged to set prices not to exceed that incentive price threshold, in order to encourage more sales among buyers who rely on the incentive to be able to afford the vehicle.

Expand and expedite loan loss reserve programs to offset investor and insurer concerns about the residual
value of used vehicles

Loan loss reserve programs allocate money to a reserve account for a lender, in order to help the lender lower their credit standards and lend to customers of lesser credit value. In the context of heavy-duty vehicles, this kind of program could help smaller operators buy zero-emission models by compensating for the lack of residual value market data. As mentioned, Southern California Edison and California Capital Access Programs (CalCap) plan to unveil a pilot-stage loan loss reserve program that can contribute 20 percent of the cost of the vehicles.