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Aug. 5, 2024Washington |  By: Lia Chien - Missouri Independent

U.S. Senate panel looks for ways to aid electric vehicle industry

tesla charging station

By Lia Chien - Missouri Independent

WASHINGTON – Republican U.S. Sen. Lindsey Graham and Democratic members of the U.S. Senate Budget Committee discussed on Wednesday ways to boost U.S. electric vehicle manufacturing to be more competitive globally.

Sen. Sheldon Whitehouse of Rhode Island, the Democratic chairman of the committee, began a hearing Wednesday by calling electric vehicle production “an economic, national security and climate imperative.”

Whitehouse highlighted the expanding global market for electric vehicles, noting that in 2023, 20% of vehicles sold around the world were electric.

“We want to be a part of that action,” Whitehouse said.

Graham, a South Carolina Republican, requested the hearing. He pointed out several times the automotive industry’s importance to the state. South Carolina is a national leader in vehicle assembly and the top tire exporter in the country, according to the state’s Department of Commerce.

Graham said the future of vehicle manufacturing is in electric vehicles and urged policies to remain competitive in the global automobile market.

His position was out of step from many in his party.

Republicans have voiced opposition to increased electric vehicle manufacturing and many oppose President Joe Biden’s goal of having 50% of vehicle sales be electric by 2030. Former President Donald Trump opposes Biden’s support of electric vehicles and said it would ruin the economies of automaker states.

But Graham, a Trump ally and a staunchly conservative lawmaker, embraced the idea of U.S. electric vehicle manufacturing and looked to strengthen U.S. infrastructure.

“So the bottom line is: This is coming, whether we like it or not,” Graham said. “And I think there’s an upside to it, to be honest with you.”

 

Strain on the grid

 

Several lawmakers raised concerns in the hearing over whether the electric grid could handle increased demand from electric vehicle charging.

Graham raised the question of where the power will come from to fuel a larger fleet of electric cars.

“Grid demand will go through the roof,” if half of cars in use are electric, he said. “How can you generate enough power to accommodate electric vehicles?”

Jesse Jenkins, a professor of engineering and energy systems at Princeton University, said by 2035 electric vehicles will consume 17% of current total U.S. electricity.

“To put it another way, by 2035, EVs will consume nearly as much electricity as is produced today by the entire fleet of nuclear power plants or all non hydro-renewables combined,” Jenkins said.

Britta Gross, the director of transportation at the Electric Power Research Institute, said strain on the grid from electric vehicles could be minimized by charging at off-peak hours.

Power demand is typically highest in the mornings and evenings. Charging vehicles at night when demand is low “can help minimize the new grid investments and ensure an affordable transition,” she said.

 

China debate

 

International competition was another highly discussed topic in Wednesday’s hearing.

Sen. Debbie Stabenow, a Democrat from Michigan, a state with a large automotive industry, raised concerns about the U.S.’s ability to compete with China, which leads the world in electric vehicle manufacturing and has poured government funds into subsidies and tax breaks to promote electric car development.

“There is not a level playing field,” said Stabenow. “Specifically, China is coming for us.”

David Schwietert, the chief government affairs and policy officer for the Alliance For Automotive Innovation, told the committee that Congress must provide incentives for manufacturers “to build resilience” for the future of electric vehicle production.

“We need to look beyond just five or 10 years,” Schwietert said. “We need to ensure that policies are in place to ensure the U.S. is protected, not just tomorrow but well beyond.”

Graham also pressed witnesses about China’s position in the global electric vehicle market, asking Maureen Hinman, co-founder and chairwoman of Silverado Policy Accelerator, a bipartisan economic policy institute, if Chinese dominance in the market was “irreversible.”

“Absolutely not,” Hinman said. “I think the U.S. and its allies and friends, if we move quickly to create agile, responsive and coordinated policies, could flip the script and reestablish market dynamics in a global economy.”

 

GOP skepticism

 

Not all Republicans on the committee were as welcoming to the electric vehicle conversation as Graham.

Sen. Ron Johnson, a Republican from Wisconsin, said he was not opposed to electric vehicles and that he owns a plug-in hybrid car, but that the government should not spend to entice manufacturing and ownership of the vehicles.

“Why do we need government subsidies?” Johnson asked witnesses. “I would say you don’t.”

“Let the marketplace dictate the speed of this innovation. Stop subsidizing this,” he said.

Sen. John Kennedy of Louisiana also pressed witnesses on the need for subsidies, repeatedly asking “if they’re so swell, how come we have to pay people to buy them?”

Kennedy speculated that many Americans have to be incentivized to buy electric vehicles because they are more expensive to operate. The median household income in Louisiana is $55,000 a year, which is below the national median, he pointed out.

A study by the environmental group Natural Resources Defense Council found that while electric vehicles are just under $3,000 more up front than a gas-powered car, they ultimately cost less to fuel and maintain over time.