“If Congress is requiring the federal government to support charging stations, let’s cut the waste and do it right,” Transportation Secretary Sean Duffy said in a press release. “While I don’t agree with subsidizing green energy, we will respect Congress’ will and make sure this program uses federal resources efficiently.”
Duffy’s statement stands in sharp contrast to the stance of other federal agencies, including the Environmental Protection Agency and the Department of Energy, which continue to block congressionally-mandated spending programs.
Only time will tell whether the new guidance is truly a win for EV charging, however. It’s a win in the sense that many EV advocates feared the agency would try to kill the program or insert poison pills into the guidance. But it’s unclear whether the changes will speed up NEVI deployment beyond what might have happened had it not been paused.
“The real story to me is the needless delay,” Joe Halso, a senior attorney for Sierra Club, told me. “They took six months to produce something that they could have done in an afternoon, and that didn’t require them to halt the program in the first place. Every day of that delay stalled critical EV charging projects.”
The goal of the NEVI program was to help states install charging stations in areas that the market, on its own, was not serving. States had to submit annual plans to the FHWA for how they would deploy the funds to fill gaps in regional EV charging networks. Once those plans are approved, states could issue requests for proposals from EV charging companies to build the new charging stations and award grants to help get them financed.
In February, Duffy issued a letter to state Departments of Transportation suspending approval of their plans for all fiscal years, pending forthcoming new guidance from the agency. That meant states would not be able to issue new awards, essentially freezing the program. At the time, the agency had approved state spending plans totaling more than $3.2 billion for fiscal years 2022 through 2025. Of that money, states had committed only about $526 million to specific projects.
In early May, 16 states plus the District of Columbia challenged the DOT’s actions in court, winning a preliminary injunction that prevented the agency from suspending or revoking their previously-approved plans. While the injunction unfroze the program in the plaintiff states, about $1.8 billion for the rest of the country was still locked up. But the judge allowed a coalition of national, regional, and community groups, including the Sierra Club, to become parties in the case and fight for the funding to be restored across the board. That means that if the plaintiffs are ultimately successful, the verdict will apply to every state, not just those 16 that filed the case.
The fact that the DOT issued new guidance this week doesn’t change anything about the case, Halso of the Sierra Club told me. The move could wind up delaying the program further.
“This new guidance prolongs the freeze by forcing states to resubmit already approved plans to access money they’re already entitled to,” Halso explained. “And we don’t know if or when federal highways will approve those plans and restore states’ access to money.” The guidance gives states 30 days to submit their plans, though it does allow them to simply re-submit previously-approved versions.
In Monday’s press release, Duffy declared the program’s implementation to date a “failure,” citing the fact that only 16% of the funds had been obligated so far. It’s true that the program has been slow in getting underway. As of this week, there are at least 106 NEVI-funded charging stations with 537 ports across 17 states, Loren McDonald, the chief analyst for the EV charging data analytics firm Paren, told me. That’s a long way off pace to achieve President Biden’s stated goal of installing 500,000 by 2030.
It’s also true that the new rules are simpler. The previous guidance, which was 30 pages long, contained more than five pages of detailed “considerations” states had to follow in developing their plans, which designated specific distances between chargers, required projects to mitigate adverse impacts to the electric grid, and mandated that States target “rural areas, underserved and overburdened communities, and disadvantaged communities,” among other rules. The new guidance, by contrast, is a tight seven pages devoid of almost any obligations not explicitly required by the Bipartisan Infrastructure Law, which created the program.
Under the previous guidance, for example, NEVI-funded stations had to be built within one mile of a federally-designated EV corridor and at no greater than 50-mile increments along those corridors. The new guidance simply says that states should “consider the appropriate distance between stations to allow for reasonable travel and certainty that charging will be available to corridor travelers when needed.”
McDonald told me that some states had been frustrated with the 50-mile siting requirement and would likely welcome that change. NATSO and SIGMA, two industry associations that represent rest stops, travel centers, and fuel marketers, issued a joint statement praising the “flexible, consumer-oriented approach.” They also specifically applauded the guidance for encouraging states to prioritize projects that are built and operated by the site owner. Some NEVI projects were being developed by a third party, such as Tesla, which had to sign a long-term lease with the site owner, like a grocery store or hotel. These agreements took time to work out, and would sometimes fall apart, McDonald told me.
But from McDonald’s vantage point, what was slowing down the program most was the fact that every state had different requirements and a different process for soliciting and scoring proposals from developers. Also, while a few states already had previous experience administering EV charging grant programs, many lacked staff and expertise in the subject. “I don’t mean this the way it’s going to come out,” McDonald said. “But they barely knew how to spell EV charging. A lot of the state DOTs really just were about building roads and bridges, and they had never had to deal with any charging.”
The new DOT guidance doesn’t seek to address either of those issues. “I’m not seeing anything in here that’s going to lead to a significant reduction in time,” McDonald said. “It seems to sort of miss where the lengthy processes were.”
The Zero Emission Transportation Association, an industry group, had a more positive outlook. Research associate Corey Cantor told me the new guidance is “workable” for the industry and provides regulatory certainty. When I asked Cantor if the changes the agency made to the guidance would help get more money out the door, he said it “remains to be seen on the implementation side,” but that states had been asking for more flexibility.
Cantor emphasized that it was important for state DOTs to have regulatory certainty and to get the funds flowing again. “Charging anxiety, after the upfront cost of EVs, is one of the highest cited barriers for entry for new adopters of electric vehicles,” he said. “And so getting the charging network filled out is key to helping us move to this next stage of the transition.”
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