California’s EV Rules Could Transform the Country
Who’d have thought 12 bureaucrats in Sacramento, Calif., would be able to change the cars available in my home state of Virginia?
About a third of the states in the country may be following suit, too. And it’s all because of an obscure statute in a federal bill from the 1970s.
If you missed the civics lesson playing out in the headlines, let me give you a refresher.
California’s Air Resources Board decides how to deal with air pollution in one of the biggest states in our country.
And because of a carve-out in the federal Clean Air Act, the state is allowed to set its own emissions standards regardless of the federal government’s stance.
Even more importantly, because of this standard, other states in the country will get to decide whether they’d like to adopt new rules out of California or stay with the federal government’s.
That’s why you hear about California’s moves affecting so much of the country – according to Smithsonian Magazine, 16 states have historically followed California’s lead.
So when California’s Air Resources Board decides on a new emissions standard for its cars, we have to take notice.
This month, the board approved a plan that mandates zero-emissions engines for all new vehicles sold in the state after 2035.
That means new cars need to be powered by lithium-ion batteries or hydrogen fuel. There are also some types of hybrids that scooch under the umbrella.
Obviously, this is good news for electric vehicles (EVs).
If more states adopt California’s standards, we could be looking at more electric cars than gas cars in the near future.
So who will the winners and losers be? And how can we invest here while holding on to our values?
Well, if you’re a venture capitalist, you’ve got your eyes on entrepreneurs working on sustainable energy.
Emerging Tech Brew reported that three sustainability technology companies recently received over $1.5 billion in venture capital funding between them.
And that’s despite venture capital firms scaling back their activities thisyear.
These new companies are working on generating power using renewable energy on both large and small scales, which will be key for households adopting EVs.
Meanwhile, car companies in America are already adapting to a zero-emissions future. From The Washington Post:
General Motors this year pledged to spend $7 billion – its largest investment ever – on four Michigan manufacturing sites for battery cells and electric vehicles. … Ford and South Korea’s SK Innovation plan to invest $11 billion in new manufacturing campuses in Tennessee and Kentucky… Tesla recently opened a giant factory in Austin; Stellantis and Samsung are spending $2.5 billion on a battery plant in Indiana[;] and Mercedes-Benz in the coming months will start producing electric SUVs at its retooled facilities in Tuscaloosa, Ala.
But it’s not all roses out there.
Utility companies are scrambling to figure out how to handle an influx of electricity demand from cars charging at home.
In the same vein, EV skeptics point out that charging stations are still hard to find in some parts of the country.
But the companies that build, install, and manage these stations are seeing a ramp-up of interest.
There will be winners and losers in this transition. I don’t have a crystal ball, but The Grove will keep you up to date as this shakes out.
In the meantime, we want to hear from you!
What are you hearing about sustainable investing around the water cooler at your office? What do you want to see us dive into next?
Email us at WeCare@MangroveInvestor.com.
Now, on to the news…
Numbers to Know
The rate of inflation in August, according to Labor Department data published Tuesday. That’s 0.1% higher than in July, and 0.3% higher than many economists predicted. The rise in inflation indicates the Federal Reserve will continue to aggressively hike interest rates throughout the rest of the year. (CNBC)
Amount raised by TeraWatt Infrastructure, a startup that builds electric vehicle chargers. The company has already bought real estate along highways in 18 states and is actively developing charging centers. CEO Neha Palmer calls it “the largest and most ambitious charging project to date for the electrification of long-haul transportation.” (TechCrunch)
50 billion kWh
The United States’ estimated electricity usage for cryptocurrency blockchains this year, according to a new White House report. That’s about the same amount of energy we spend on home appliances such as refrigerators, lighting, and TVs. The U.S. currently hosts the world’s largest Bitcoin mining industry. (Input)
What’s New in Sustainable Investing
Honda considers listing for electric-motorcycle business
Honda is the world’s No. 1 motorcycle company by market share, and it’s aiming to roll out 10 or more electric motorcycle models by 2025. Creating a separate stock-market listing for this segment of its business would help Honda raise cash for its plans. The company expects to sell 3.5 million electric motorcycles a year by 2030. (The Wall Street Journal)
Tokyo plans to require that new homes have solar panels
Government officials announced the new requirement on Friday. Starting in April 2025, homebuilders and developers will need to install solar panels on all new buildings and houses. Tokyo Gov. Yuriko Koike added that the metropolitan government will work to improve subsidies to ensure “a smooth launch of the system.” (The Japan Times)
Links We Like
“The Minnesota Twins announced today that they have been awarded LEED Platinum certification […] making Target Field the first Major League Baseball venue to receive the U.S. Green Building Council’s highest possible honor.” (MLB.com)
“More than 90% of the materials used in lithium-ion batteries can be recycled. The just-started LiBinfinity project, however, goes far beyond and aims to develop a holistic recycling concept for lithium-ion batteries.” (Karlsruhe Institute of Technology)
“Depending on your eligibility, the [High-Efficiency Electric Home Rebate Program] could cut thousands of dollars off the cost of purchasing and installing electric appliances over the next decade.” (The New York Times)