1 million electric vehicles: Inside the state’s plan for transforming transportation
SPRINGFIELD — With a pair of major policy victories in hand, Gov. J.B. Pritzker traveled to the United Nations Climate Change Conference in Glasgow, Scotland, at the beginning of the month and shared a vision for his home state: “Illinois intends to become the best place in North America to drive and manufacture an electric vehicle.”
It’s a message he’s repeated in recent public appearances, and one he brought to international business leaders in London prior to the U.N. conference. And it’s one the governor believes can yield victories for his administration on a pair of his campaign cornerstones — economic growth and carbon reduction.
“This is about economic development as much as it is about saving our planet,” Pritzker said during a panel discussion at the U.N. conference with governors from Washington, Oregon and Hawaii.
Numerically, that vision amounts to putting 1 million electric vehicles on state roads by 2030, a goal written into the Climate and Equitable Jobs Act, a wide-ranging decarbonization bill Pritzker signed into law in September. But how can Illinois increase the number of electric vehicles to 1 million from the 34,363 licensed in the state as of the end of October? For the Pritzker administration, the new law and a tax credit for manufacturers known as the REV Act make up the backbone of a push to lure private investment while breaking down well-documented consumer barriers to electric-vehicle adoption as the industry stands on the cusp of an explosion.
“We have sent a very clear market signal not just in the United States, but now across the world, that this is going to be the place if you want to make, manufacture or drive an electric vehicle, to do it,” Deputy Gov. Christian Mitchell, who accompanied Pritzker on his European trip, said in a phone call.
With the new laws passed, the focus turns to implementation and distributing more than $200 million in state and federal funding for the rollout of charging infrastructure.
Mitchell and other advocates behind CEJA recently spoke to Capitol News Illinois about the next step for meeting EV rollout goals, the strengths of the two laws that aim to get Illinois there, and other actions the administration has taken.
‘Jobs, jobs, jobs’The key to Illinois’ approach to penetrating the electric-vehicle market, Mitchell said, is that it addresses both the supply and demand sides.
“It’s incredibly important if we are going to be successful as a state and environmentalists are to be successful across the country, that we couch this issue in jobs, jobs, jobs,” Mitchell said.
On the supply side, the climate law includes credits of up to 80 percent for the installation of charging infrastructure. Money for that will come from a $70 million allotment from the state’s 2019 Rebuild Illinois infrastructure plan. Another $149 million from a recently passed federal infrastructure plan will also aid in the buildout.
On the demand side, the climate law includes a $4,000 rebate for those who buy electric vehicles in the state. The governor’s office said there’s about $5.1 million in the fund that will supply those rebates beginning in July 2022.
and as of now it has only a “rough estimate” that “thousands” of Illinoisans will be able to receive the rebate.
For companies like EVgo, one of the largest public charging networks in the U.S., policies like CEJA serve as a market catalyst, said Sara Rafalson, vice president of market development and public policy at the company.
“The most important thing that came out of the legislation at the state level, is that Illinois is really poised for success, because we have in place now both the complementary policies to support vehicle sales as well as sustained long-term investments in charging infrastructure,” she said. “For a business like ours, when we see higher vehicle sales, that sends a strong signal to the market that we need to build more chargers.”
The REV Act, which passed with near-unanimous bipartisan support in the fall session, creates payroll tax credits ranging from 25 percent to 100 percent of income tax withheld for new or retained EV manufacturing jobs, depending on factors such as company location and number of employees hired. It also creates a 10 percent credit for training expenses and credits for construction wages and building materials.
That measure also provides the incentives to manufacturers of electric vehicle parts, such as batteries.
At a bill signing event for the REV Act, Jim Chen, vice president of public policy of Rivian Automotive, which has an EV manufacturing plant in the Bloomington-Normal area, said the bill will be a major support for the company that already employs more than 3,000 Illinoisans in its 3.5 million square feet of manufacturing space.
“Today’s bill signing represents the next step in promoting Illinois as the Silicon Valley of EVs, as we work together to attract new investment from suppliers and other supporting players in this industry,” he said.
The REV Act is also an effort to lure new manufacturers here while encouraging existing companies, such as the Stellantis manufacturing company in the Rockford area, to retool their existing plants.
“The fact that the governor was able to go to Glasgow, not just with a climate bill in hand that provides a $4,000 incentive to consumers to buy an electric vehicle, but also an incentive package to get more of those sites here to manufacture EVs as well as all the downstream materials that are necessary, is a way of creating a new, modern, reinvigorated manufacturing sector in the state of Illinois,” Mitchell said.
Addressing consumer concernsThe rebate is aimed at addressing one of two major barriers to EV adoption – cost.
A study from the national automobile service association AAA, recently cited in a Belleville News-Democrat report on the EV market, found that in 2019, an EV costs about $590 more annually than a gas-powered car over a five-year period due to higher initial prices on EVs.
Jessica Beverly, a renewable energy advocate with the Sierra Club of Illinois who helped push for CEJA’s passage, said while EVs are more expensive, they also cost less to maintain, and purchasers may be eligible for a $7,500 federal tax credit that could be increased to $12,500 if President Joe Biden’s domestic spending agenda passes Congress.
The AAA study corroborated the maintenance cost claim, finding that at 75,000 miles of driving, an EV cost about $330 less to maintain and about $700 less to fuel annually than a gas-powered car.
But that study also found that 58 percent of respondents cited the availability of charging infrastructure as their main concern, while just 51 percent cited price.
Beverly noted the market itself is, to a large extent, addressing those concerns. The current median range for a single EV charge is 250 miles, with high-end models of major brands like Tesla offering ranges up to about 400 miles. The average was just 90 miles six years ago.
“You can’t really travel more than 50 miles in Illinois without coming across a gas station,” she said. “But it’s not the same for an electric charger. And, yes, while range is improving significantly as new vehicles are developed, it’s still our habit that you need to know where you can fill up.”
But the charging process is inherently different than filling up at a gas station, largely because the vast majority of EV drivers do their charging at home. That means most people will be able to handle their daily driving without needing public charging, except when they’re going on longer road trips.
When needed, public charging stations can sometimes be found for free at grocery stores or parking garages as an enticement to customers. But the vast majority of public charging is offered by private charging networks like EVgo, or ChargePoint, which have varying pricing and subscription models that generally amount to about 22-29 cents per minute for a charge.
As of now, there are two types of chargers on the market, a Level 2 charger that takes about 6-8 hours to fully charge, and DC fast chargers, which take about 30 minutes.
According to the U.S. Department of Energy, there are 919 electric charging station locations in Illinois with 2,306 charging ports, 1,815 of which are Level 2 and 478 of which are fast charge.
As the state aims to put another 970,000 EVs on its roads in the next nine years, the need for public charging is going to increase significantly, particularly in rural areas where it is currently sparse and in densely-populated areas with a lot of multi-family housing where at-home charging isn’t available.
Andrew Barbeau, an advocate with the Clean Jobs Coalition which helped push CEJA through the General Assembly, said that’s why lawmakers included a “beneficial electrification” process in the bill aimed at determining where charging is needed most to accelerate EV adoption.
It’s also why the state created the position of electric vehicles coordinator through the Illinois Environmental Protection Agency, a position that Mitchell said the administration is working to fill.
“So what the legislature wanted to focus on with this legislation was not just looking at where the market is today, but it wanted to fill in the kind of gaps in the market,” Barbeau said in a phone call. “It wanted to ensure that people who live in apartments or condos, or they live in dense areas where parking is mostly on the streets, would have access to the electric vehicle market too.”
Barbeau pointed to a Department of Energy study which showed if 88 percent of people charge at home, one public Level 2 charger would be needed for about 25 EVs. But if that number drops to 82 percent charging at home, there would need to be one Level 2 charger for 13 vehicles.
“So that’s a big…