California’s decision to ban sales of internal combustion vehicles after 2035 is good news for both automakers and the electricity grid, Rocky Mountain Institute CEO Jules Kortenhorst writes in a recent blog post.
While much of the commentary that greeted the September 23 announcement by Governor Gavin Newsom focused on the possibly fraught logistics of implementing the ban, Kortenhorst sees the announcement as a source of competitive advantage for the United States as a whole.
“As the cost of clean energy continues to fall across technologies including solar, wind, and batteries, the trend toward both electric vehicles and a 100% clean electric grid is progressing rapidly,” he writes. “By driving auto manufacturers and grid operators further along this path, California’s new executive order will help ensure that the United States is not left too far behind efforts in the European Union and China.”
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That momentum is being driven by plummeting costs that already make electric vehicles cheaper to own and operate than internal combustion, and will soon make them less expensive to buy. “They are also better in many other ways: they are more fun to drive, require less maintenance, and have a longer life.”
The basic economic benefits are “even more relevant for fleets, where the total cost of operating the vehicles is key,” he adds. “This is why fleet owners like Amazon and Walmart, that consider the total cost of ownership perspective, are already moving toward purchasing electric vehicles (EVs) for their trucking fleets.”
Kortenhorst stresses that recent power system outages in California were caused by an overall lack of grid capacity and operational errors, not be the introduction of EVs or renewable energy.
“During a period of record high demand and temperatures across the entire western area of the country, there was simply not enough supply available,” he explains. “Adding to this, an operational error apparently sent incorrect instructions that caused a gas plant to shut down, resulting in further capacity shortfall.”
But with “some careful work to expand the grid’s capacity,” he says there’s no reason the California grid can’t support full electrification of vehicles and a variety of other devices—and EVs can also help boost the reliability and resilience of the grid itself. “If we add more EVs, which are really just mobile batteries, and also make the grid smarter using digital technologies, these vehicles can serve to help balance supply and demand.”
Get the details of Jules Kortenhorst’s analysis here.