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California takes bold step to ban new gas cars by 2035

Gas cars banned in California by 2035.

California has voted to end the sale of new gasoline-powered cars by 2035, in a new policy proposed by the California Air Resources Board. This is a bold step to accelerate the transition to electric vehicles over the next decade.

A new regulation will require all new passenger vehicles sold by 2035 to be zero emissions in the state of California.

Transportation currently accounts for half of California’s GHG emissions, and the decisive shift to zero emission vehicles will be significant to keep the state on track to net zero.

The new regulation coupled with the Inflation Reduction Act will cause a surge in demand in electric vehicles, and automotive manufacturers, infrastructure, and supply chain will need to adapt to meet this demand.

Advance Clean Cars II Regulation

After California’s governor Gavin Newsom issued an executive order in September 2020 to require the sales of all new passenger vehicles to be zero emissions by 2035, two years later the order will now become law.

The Advanced Clean Cars II Regulation, proposed by the California Air Resources Board (CARB), will require all new passenger cars, trucks and SUVs sold in California to be zero emissions by 2035. The policy also sets interim targets – by 2026, that state aims to have 35% of new passenger vehicles sold produce zero emissions, and by 2030, this ramps up to 68%.

The new regulation also aims to significantly reduce emissions in heavy transport, by implementing more stringent standards to reduce smog-forming emissions, with a view to shift the sector towards electrification by 2035.

“Our future depends on bold climate action [and California] is proud to set the precedent for clean transportation goals” tweeted the Office of the Governor of California on the new regulation.

According to the CARB, California already has the largest zero emission vehicle market in the US, with more than 16% of new vehicles sold being zero emissions or plug-in hybrids.

Transitioning to electric vehicles is a move to improve health and net zero progress

The new regulation will be a significant driver to reduce both emissions from vehicles, as well as air pollution that affects the health of Californians.

Transportation is the state’s leading source of greenhouse gas (GHG) emissions, with most households having one or two vehicles according to the California Energy Commission.

Currently, there are over 29 million vehicles registered in California, with another 1.9 million expected to be registered this year. As the largest car market in the US with millions of new cars added to the roads each year, the new regulation will have a significant impact on an already growing electric vehicle market in the state.

The state currently makes up 10% of all cars registered in the US, but accounts for over 40% of all zero emissions cars in the country. The majority of these zero emission cars are electric vehicles, and this trend is expected to continue over the next decade.

Renewable energy targets

While nearly half of California’s electricity grid is powered by natural gas today, the state has also put in place ambitious renewable energy targets. By 2030, California aims to generate 60% of its electricity through renewable energy, and transition to 100% by 2040.

The rapid transition to electric vehicles coupled with the transition to renewable energy could mean some serious emissions reductions for California. Currently, the transportation sector accounts for around half the state’s GHG emissions, while electricity accounts for around 14%.

The transportation sector is also a leading source of air pollution in California, responsible for 80% of nitrogen oxide pollution and 90% of diesel particulate matter pollution. 

CARB expects that with the new regulation, air pollution will be significantly reduced in California and provide public health benefits of at least $12 billion over the life of the regulation by reducing premature deaths, hospitalisations and lost workdays associated with exposure to air pollution.

Will the automotive industry keep up with zero emission vehicle demand?

The new regulation will require a rapid scaling up of net zero emissions vehicles over the next decade, and there have been doubts that the automotive industry will be able to meet this demand.

Car manufacturer trade body the Alliance for Automotive Innovations (AAI) warned that there will be multiple hurdles to overcome in order to successfully transition to 100% emissions free vehicles in a short time period. Issues such as comprehensive charging infrastructure, availability and cost competitiveness of materials needed to manufacture batteries, and supply chain issues could be barriers to achieving this goal.

“These are complex, intertwined and global issues well beyond the control of either [CARB] or the auto industry”, commented AAI’s president John Bozzella.

However, so far leading automotive manufacturers have been supportive of the new regulation.

“The CARB Advanced Clean Cars II rule is a landmark standard that will define clean transportation and set an example for the United States… we’re committed to building a zero emissions transportation future that includes everyone, backed by our own investments of more than US$50 billion by 2026 in EVs and batteries”, said Bob Holycross, chief sustainability officer at Ford.

Toyota, a company with a turbulent history of fudging emissions reporting, also was supportive of the new regulation saying that the company shares “the vision of GHG reduction and carbon neutrality goals with CARB and the state”.

Demand for zero emission vehicles to boom

Along with California’s new regulation, the recently approved Inflation Reduction Act in the US will help drive the demand for electric vehicles in the coming years.

The new act will provide US$10 billion in investment tax credits for electric vehicle and clean energy manufacturing facilities, US$60 billion to support low-income communities and communities of colour for grants towards zero emissions technology and vehicles, as well as a tax crest of up to US$7,500 for people buying electric vehicles.

Bozzella acknowledges that this act will provide significant support to transform the automotive sector.

“On the demand front, we’ve said the legislation’s purchase incentive was a missed opportunity, especially while raw material and battery supply chains are still coming into place”, commented Bozzella. 

“But Congress also made some meaningful investments on the supply side… over the long haul, that’s going to be essential to making the widest range of EVs available”, he added.

Overall, demand for zero emissions vehicles is set to boom in California and the US thanks to the two new legislations – time will tell if the automotive industry and supply chain will be able to adapt to meet this new demand. 

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