Paul DeCotis, senior director in the energy and utilities practice of West Monroe, says the money set aside by the infrastructure bill for electric vehicle development will have a huge impact on the future of that technology.
The infrastructure bill currently before Congress is the first of its kind to devote substantial funding to the development of electric vehicle infrastructure, DeCotis says. The money will be used for a variety of related purposes, including the construction of private charging stations, utility purchase programs and fleet conversions at the state and municipal levels.
The bill provides “a lot of money over a sustained period of time, which provides investors with certainty,” says DeCotis. “And investors like certainty.” Developers in both the private and public sector would be able to draw on funds over an extended period.
The government action combines with progress in the automotive industry toward increasing the manufacture of electric vehicles, and a buildout of the electric grid. As a result, says DeCotis, “we’re going to see a system that looks way different than it looks today.” But it will likely take eight to 10 years for the system to scale. Utilities must invest in a nationwide transmission and distribution system, and “those projects take time.”
The technology of electric vehicles and supporting infrastructure must also advance. For the most part, charging is still a slow process. Yet DeCotis doesn’t view this restriction as a significant hurdle. The infrastructure bill includes money for research and development by both the public and private sector on the creation of batteries that charge more quickly and have longer life. That should help to alleviate customers’ “range anxiety” about driving electric cars over long distances.
Commercial transportation could benefit as well, although DeCotis believes that hydrogen power is a better option for heavy trucks as well as marine and air travel. The weight and duration of batteries make electric power less feasible for those sectors.