Charging Ahead The Future of Electric Vehicles

The Senate Committee on the Budget held a hearing to explore the future of electric vehicles (EVs), focusing on the challenges of U.S. competitiveness in the global EV market.

By Audrey Hwang August 01, 2024

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SUBJECT: Charging Ahead: The Future of Electric Vehicles

DATE: July 31, 2024

OVERVIEW: The United States Senate Committee on the Budget held a hearing to discuss the future of electric vehicles. The hearing focused on China’s presence in the current electric vehicle market, the use of government subsidies, and adjusting the Highway Trust Fund to work better in today’s changing society. 

HEARING RECORDING LINK: https://www.budget.senate.gov/hearings/charging-ahead-the-future-of-electric-vehicles

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Witnesses

  • Dr. Jesse Jenkins, Assistant Professor and Macro-Scale Energy Systems Engineer, Department of Mechanical and Aerospace Engineering, Andlinger Center for Energy and Environment, Princeton University 
  • Britta Gross, Director of Transportation 
  • Maureen Hinman, Co-Founder and Chairwoman, Silverado Policy Accelerator 
  • Dave Schwietert, Chief Government Affairs and Policy Officer, Alliance for Automotive Innovation
  • Jeff Davis, Senior Fellow, Eno Center for Transportation

Key Themes & Highlights

  • Republican Concerns:
    • "Mining of Critical Minerals: Led by Senator Grassley, Republicans expressed concerns about the U.S. inability to extract essential rare earth minerals and other elements needed for EV components domestically. They argued that transitioning to a fully U.S.-dependent EV supply chain is unattainable without sourcing materials from other countries.
    • Government Subsidies: Senators Johnson and Kennedy argued that companies might exploit government subsidies intended for EV development. They questioned the continuation of subsidies, suggesting that they should be halted if companies already have sufficient market support in attempts to conserve crucial taxpayer money. 
    • Infrastructure Availability: Mentioned concerns regarding the availability of communal structures to accommodate the influx of EV technologies and growing industries. Notably, it is apprehensive about potential strains on energy grids during seasons of peak usage- instead offering further attention towards the upkeep of reliable energy sources. Further distress regarding infrastructure was suspended during discussions of widespread EV adoption, particularly in rural areas where access to resources and charging stations would be especially difficult to assemble and maintain. 
  • Democratic Concerns:
    • Reducing Emissions: Nearly all Democratic senators emphasized that the primary goal is to reduce carbon emissions. They advocated for transitioning to EVs as a critical solution to address climate change and meet environmental targets.
    • Infrastructure for Charging Stations: Senator Stabenow and others raised concerns about the current lack of infrastructure to support a fully electric fleet of heavy and light-duty vehicles. They stressed the need for significant investment in charging stations and grid upgrades.
    • Equity in Access: Senators instructed on the importance of impartial implementation, emphasizing the purpose of further legislation to ensure equitable access for marginalized communities. Focused on the cruciality of providing affordable options and infrastructure in underserved districts. 
  • Witness Testimonies:
    • Dr. Jesse Jenkins: Asserted that the technology needed to update the grid and infrastructure is already available. He emphasized that with the right incentives and policies, the U.S. can lead the global EV market.
    • Britta Gross: Expressed confidence that the U.S. can handle the significant changes required to support a fully electric fleet. She highlighted successful case studies and technological advancements that make this transition feasible.
    • Maureen Hinman: Believed that the U.S. is capable of competing with or surpassing China in the global EV market. She emphasized the importance of policy changes to strengthen the U.S. position and encourage domestic innovation.
    • Dave Schwietert: Argued that the lack of updates to the electrical grid and insufficient infrastructure are the primary barriers preventing the U.S. from being competitive in the EV market.
    • Jeff Davis: Discussed the Highway Trust Fund (HTF), stating that its financial challenges are due to factors beyond the rise of EVs. He suggested that reforms are needed to ensure sustainable funding for roadway infrastructure.
  • Contentious Points:
    • Republicans: Argued against the continuation of government subsidies for EV companies. They expressed concern that companies may exploit these subsidies and that the market should determine the success of EVs without government interference. They questioned the fairness of using taxpayer money to support companies that might already have sufficient market backing.
    • Democrats: Democrats emphasized the necessity of government subsidies to accelerate innovation, reduce emissions, and help the U.S. compete globally against China's dominance in the EV market. They argued that subsidies are critical for building infrastructure, supporting research and development, and making EVs more accessible to consumers.
  • Key Discussions:
    • Chinese Monopoly: Both parties and all witnesses agreed that the U.S. can be competitive with China in the EV market if appropriate funding, policies, and strategic initiatives are implemented.
    • Highway Trust Fund Reform: There was bipartisan agreement on the need to reform the HTF to include contributions from EV users. This inclusion would ensure that all vehicles contribute to roadway infrastructure maintenance and support.
    • Consumer Outreach: There was unilateral support for the education of consumers regarding the benefits of electrical vehicles to incentivize further legislation on new reforms for the advancement of EV industries. 

In-Depth Notes

  • Senator Whitehouse: The future of vehicles is electric, no matter what the US does. This switch allows for freedom from petro-dictators. Urges investment in clean energy projects and reconciles EVs with the Highway Trust Fund.
  • Senator Grassley: We can't support EV business without mining that ruins the environment or getting raw materials from China. Aren’t that beneficial to reducing emissions and will result in massive job losses in the US? Power lines and grids are a big problem.
  • Senator Graham: Power demand will increase, and we can get enough energy by looking into nuclear power. The US doesn't have the resources to make EV batteries; we would get them from China. Wants the US to be able to manufacture EVs to create jobs and defeat China.
  • Dr. Jesse Jenkins: Cut greenhouse gas emissions and reduce vulnerability to shocks in the global gas and oil industry by switching to EVs. The US has time to prepare markets, grid, and infrastructure for all cars to become electric. Technology is available; it just needs incentives.
  • Ms. Britta Gross: The grid has already adapted to a change this large in the past. The energy that light-duty vehicles will use up would be spread across the grid to minimize impacts on local distribution systems, but heavy-duty vehicles would have larger impacts. Grid updates take too long.
  • Ms. Maureen Hinman: The US is expected to be the leader in EVs with current trends but is held back by laws that stop them from openly competing with the Chinese market. CCP industrial policies prevent the US from being able to cheaply produce batteries. 
  • Mr. David Schwietert: EV market growth is slowing. It takes time to change the vehicle market to electric overnight, charging infrastructure and the grid still need to be updated. Warns about China.
  • Mr. Jeff Davis: The Highway Trust Fund hasn't worked for a long time. Electrification didn't start it, but it does make it worse. This was caused by gas price increases and overall decrease in driver mileage.
  • Senator Stabenow: The biggest issue is charging systems; this is always solvable, it happened with creating more gas stations, and we can do that for charging systems. Bipartisan Infrastructure bill funds the grid and charging stations. The US is already looking into REMs within the country and increasing battery production. We can combat China by funding companies.
  • Senator Merkley: Emphasizes the fact that it is cheaper to charge EVs rather than to pay for gas. We can expand charging stations by changing the law to allow for charging ports at rest stations. Promotes buying used EVs for middle-class consumers.
  • Senator Braun: The upfront cost of EVs is too high, and gas vehicles are cheaper. Doesn’t want to force dealerships/drivers to choose EVs. Can’t afford all the technological developments to sustain a grid to support EV fleets.
  • Senator Kaine: Focuses on EV trucks. Smooth driving that comes with EVs reduces fatigue in drivers and promotes safety when driving. Development of EV supply chains will likely be based in rural communities, which will affect rural development.
  • Senator Johnson: Argues that EVs don’t need government subsidies because they are already popular to the point where they have large market appeals. The US doesn't have the mining or electric capacity to transition fully to EVs. Believes the government should not intervene in the EV market. 
  • Senator Van Hollen: We need to act now before it's too late to combat China's influence in the global EV market.
  • Senator Kennedy: Brings up the point that there are people who don’t want to buy EVs. Argues that subsidies shouldn't be given to fund EVs because the reason people don't want them is because of costs. Highlights Jewish students in Princeton to Dr. Jesse Jenkins during questioning.