New Jersey Economic Development Authority
Request for Information
2020-RFI-OET-TL-098
for
Supporting the Transition to
Zero-Emission Commercial Transportation
Response Submitted by Allen Kratz, Principal, Resilience Works, LLC
A. Background
I am the principal of Resilience Works, LLC, a firm incorporated in New Jersey that helps communities in the Mid-Atlantic and New England states secure funding for climate-mitigation and climate-adaptation infrastructure.
I am an independent revenue-strategy consultant on assignment from the Maine Climate Council helping Governor’s Office of Policy Innovation and the Future identify ways of funding expanded electrification of vehicles in Maine, where the transportation sector is responsible for 54% of the state’s greenhouse gas emissions.
Electrification of medium- and heavy-duty vehicles (MHDVs) holds particular importance in Maine, where a rural population living in a harsh winter climate relies on pickup trucks and larger trucks for basic all-wheel transportation as well as multi-seasonal occupations, e.g., farming in the summer, snow-plowing in the winter, logging in the spring.
I offer the information below on my own behalf, not representing the views of my client in Maine.
B. General Questions
4. What are the top three initiatives that New Jersey should pursue to accelerate overall zero-emission MHDV deployment?
a. New Jersey would do well to ensure robust funding for zero-emission MHDV deployment. Two Canadian provinces offer helpful examples.
Zero-emission vehicles expert Peter Slowick notes in Funding the Transition to All Zero-Emission Vehicles (October 2019) that both Quebec and British Columbia support electrification of MHDVs.
Québec has additional incentive programs for heavy-duty trucks, infrastructure for marine and non-road equipment, $11.9 million for electric public transit, and $30 million for electric public school buses. The Québec government also provided an $8.6 million grant to launch a collaborative industry effort to design two bus and two freight truck prototypes for manufacturing. One of the key initiatives supporting several ZEV programs in the province is the Transportation Electrification Action Plan (TEAP). TEAP had a $420 million budget beginning in 2015, with $187 million added in 2017 and 2018. Eighty percent of TEAP revenues are provided by the Green Fund, which is funded by several sources including the sale of greenhouse gas allowances under Quebec’s cap-and-trade system. Ministry and agency credits represent about 20% of TEAP funding.[1]
British Columbia, another leading ZEV province in Canada, released a 3-year fiscal plan that includes a $98 million (CAD) investment to help make ZEVs more affordable and convenient (British Columbia Ministry of Finance, 2019). The program includes $42 million in point-of-sale incentives available through March 31, 2020, or until funding is depleted. Nearly $50 million is allocated in fiscal year 2019–2020 for public fast-charging and hydrogen fueling stations, incentives for medium- and heavy-duty vehicles, training for automotive technicians and electricians, fleet procurement, home and workplace charging stations, and public outreach. Additional funding has been made available through 2022, including $3 million for development and implementation of the ZEV regulation and $5 million for charging infrastructure along highways and at government buildings.[2] The budget includes an additional 10% dedicated to fiscal incentives for medium- and heavy-duty ZEVs.[3]
b. New Jersey should extend EV incentives to MHDVs.
To the extent that low-income New Jersey vehicle owners live in rural parts of the state and rely on trucks for multi-seasonal and multi-occupational transportation and income production, it is important to extend the state’s EV incentive program to include MHDVs.
New Jersey could follow the lead of Colorado, which offers a tax credit that ranges from $2,750 to $16,000 for the purchase or conversion or lease of medium-duty and heavy-duty electric trucks, as shown in the chart on the next page.
Colorado Incentives for Electric MHDVs
Medium-duty electric truck
$8,000 for purchase or conversion; $4,000 for lease
$5,000 for purchase or conversion; $2,500 for lease
$4,000 for purchase or conversion; $2,500 for lease
Heavy-duty electric truck
$16,000 for purchase or conversion; $8,000 for lease
$10,000 for purchase or conversion; $5,000 for lease
$8,000 for purchase or conversion; $5,000 for lease
The credit amount for any qualifying truck is limited to the difference in manufacturer's suggested retail price between the qualifying truck and a comparable truck that operates on either gasoline or diesel fuel. The credit that may be claimed for converting a truck to a qualifying truck is limited to the cost of conversion.[4]
c. New Jersey should proceed to implementation of the Transportation and Climate Initiative
New Jersey, like other states, including Delaware, Massachusetts and New York uses proceeds from the Regional Greenhouse Gas Initiative to fund the state’s EV incentives.
New Jersey would do well to take the next step: implementing the Transportation and Climate Initiative to invest auction proceeds from that proposed cap-and-trade structure into electric vehicle expansion – including incentives for MHDVs – and into an expanded network of fast-charge electric vehicle supply facilities in the state.
Submitted by:
Allen Kratz, Principal
Resilience Works, LLC
Climate-change consulting to give our future a future
resilienceworks.info 201-214-7476 207-326-0845 @allenwkratz
1245 Bloomfield Street, Hoboken, New Jersey -07030
[1] Peter Slowick, Dale Hall, Nic Lutsey, Michael Nicholas, Sandra Wappelhorst, Funding the Transition to All Zero-Emission Vehicles, International Council on Clean Transportation white paper, October 2019, page 10, Retrieved from https://theicct.org/sites/default/files/publications/Funding_transition_ZEV_20191014.pdf
[2] Peter Slowick, Dale Hall, Nic Lutsey, Michael Nicholas, Sandra Wappelhorst, Funding the Transition to All Zero-Emission Vehicles, International Council on Clean Transportation white paper, October 2019, page 10, Retrieved from https://theicct.org/sites/default/files/publications/Funding_transition_ZEV_20191014.pdf
[3] Peter Slowick, Dale Hall, Nic Lutsey, Michael Nicholas, Sandra Wappelhorst, Funding the Transition to All Zero-Emission Vehicles, International Council on Clean Transportation white paper, October 2019, page 11, Retrieved from https://theicct.org/sites/default/files/publications/Funding_transition_ZEV_20191014.pdf
[4] U.S. Department of Energy, Alternative Fuels Data Center, Colorado date. Retrieved from https://afdc.energy.gov/laws/11702