Former Tesla Exec Explains NEVI Program & How Trump Favored An “America Last” Policy On EVs – CleanTechnica

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Rohan Patel, former Vice President of Global Public Policy and Business Development at Tesla, has been superb at explaining policy matters as they relate to Tesla — both when he worked at Tesla and since he left. A couple of recent tweets from him caught my attention.

I’ll start with the juicier one, and then I’ll get to the longer one explaining the NEVI program for everyone.

There’s a lot of confusion in the Tesla community about how much different presidential administrations have helped (or not) Tesla. There’s a bitter taste in some people’s mouth because Joe Biden didn’t praise Elon Musk or include him in events about EVs. But the fact of the matter, if you look into things, is that Donald Trump did nothing for Tesla and was very anti-EVs in key ways, while Joe Biden’s administration combined with Congress when it was controlled by Democrats gave Tesla MASSIVE substantive support.

“Trump favored an ‘America last’ policy on EVs and de-facto favored PHEVs and foreign-made vehicles,” Patel writes. “Any manufacturer selling any electric vehicle (including PHEVs), regardless of where it was produced or its supply chain, was eligible for the $7500. Mitsubishi Outlander, Chrysler Pacifica, Prius plug-in, Hyundai Ioniq, Nissan Leaf, BMW i3, Volkswagen e-Golf, Kia Niro EV, Audi e-tron, Jaguar I-Pace, Ford CMax, Mercedes had a few models, etc. The IRA production and supply chain requirements kicked out many vehicles and especially PHEVs and uncapped the incentive for first movers to scale the industry in America and the supply chain in allied countries.”

That last line is about the $7,500 US EV tax credit and was in response to a previous tweet by Brian Henderson noting that “From Jan 2020, both GM and Tesla had exceeded the prior cap of 200,000 #EVs allowed under pre-IRA federal incentives.” Actually, the linked story says much more than that. From late 2019, the Forbes article explains that the Trump administration and Congress ignored efforts from Tesla and GM to bring back the tax credit for them. “The Trump administration and Congress ignored pleas from Tesla and General Motors to extend a crucial tax credit for electric vehicle buyers, a move expected to result in declining sales of the zero-emission cars just as the consequences of climate change intensify,” Forbes writes. “The current $7,500 tax credit, which reduces the price of all-electric vehicles, phases out after an automaker has sold 200,000 EVs, a threshold only Tesla and General Motors have hit. The credit will be available to consumers buying an EV from other automakers until their cumulative EV sales reach 200,000.” (It’s actually a little more complicated than that — a phaseout period began after passing 200,000 EV sales, but the tax credit then wasn’t reduced for a couple of quarters, was then cut in half, and was eventually eliminated after a year.)

The EV tax credit had an interesting history that I’ve explained before. It ended up penalizing early leaders in the EV industry because it was changed late from a 200,000 EV sales milestone across the industry to an automaker-specific milestone (early leaders lost the tax credit sooner, and then their competitors got an advantage in the marketplace). Donald Trump and a Republican-controlled Congress didn’t care. Joe Biden and Democrats, on the other hand, revived the tax credit for anyone — as long as they met stronger US-focused manufacturing requirements.

Tesla is also getting millions or billions of dollars of support for manufacturing battery packs, battery cells, and battery components in the USA. The company got nothing of the sort from the Donald Trump administration.

On to the NEVI (National Electric Vehicle Infrastructure) program, let’s get to what Patel said. “Here are [a] few facts:

1. Appropriation vs Obligation. Yes, Congress appropriated money ($5B) to the NEVI program. It is appropriated at $1B per year for 5 years. The state agencies are now in the early stage of the process of obligating (contracting) that money through state solicitations

2. Each state gets a formula allotment from the DOT and the *states* spend that money in accordance with some baseline requirements. So while the Biden team deserves some criticism for too many requirements and some delay, most of the delays that many keep harping on are actually at the state level.

3. Two other programs also exist for other types of charging that aren’t formula based and directly granted by the federal government – Charging and Fueling Infrastructure (CFI) program, and Electric Vehicle Charger Reliability and Accessibility (EVC-RAA) program. Emphasis on innovative truck, bus and level 2 through these two grant programs.

4. There are NEVI awards/contracts for close to 3,000 ports that have been made thus far and I’d expect that number to accelerate significantly over the coming months.

5. The Tesla connector (NACS/J3400) is eligible as a part of the program and Tesla itself is winning a good percentage of the overall state grants. Tesla will also get a sizable chunk of tax credits from the 30C charging tax credit and its expansion in the IRA.”

Patel adds that Tesla’s head of federal affairs, Hasan Nazar, has also put out a good post on this topic. Here’s what Nazar tweeted:

“Since the @USTreasury guidance was recently released, I thought I’d spend a little time talking about one of the underappreciated wins and quirky histories of the IRA: reform of the Section 30C Alternative Fuel Vehicle Refueling Property Credit, historically the primary policy driver of private charging investment.

“The 30C tax credit was originally enacted as part of the Energy Policy Act of 2005 (EPACT05). In an effort to reduce America’s dependence on foreign oil–a particularly relevant issue at a time when the US was mired in a foreign war driven by the need to secure its enormous oil demand–Congress developed a tax credit to encourage gas station operators to add alternative fuel pumps at their stations.

“(Note that 30C was part of a suite of policies within EPACT05 designed to reduce foreign oil dependence in tandem with measures such as the Renewable Fuel Standard and alternative fuel requirements for federal fleets.)

“30C provided a 30% tax credit for any eligible expenditure, including fueling infrastructure for hydrogen, biodiesel, propane, and certain ethanol blends. Of course, those were the alternative fuel crazes of the moment. As such, the law 30C limited utilization to once per eligible location.

“The limitation was a rather benign restriction in this context: Congress didn’t foresee the need for gas station owners to build more than one alternative fuel pump per site. The subsequent modest uptake of those vehicles seemed to validate that assumption.

“While plug-in EVs and charging were far from most lawmakers’ minds when conceiving 30C, EVs started coming to market in droves shortly after EPACT’s passage. The IRS eventually clarified that electrons also qualified as an alternative fuel, thus making charging investment 30C eligible.

“Charging infrastructure therefore was subject to the same rules originally written for traditional alternative fuels, including the one pump per station limitation. For commercial charging developers, this meant that sites could claim the credit for one charger per site, even though fast chargers often have ten or more fast chargers per location, severely curtailing the credit’s effect.

“Over time, as other alternative fuel vehicles fell by the wayside and EVs gained traction, 30C was primarily utilized for charging. This led to the obvious question: why keep the one use per site limitation?

“Well, after years of advocacy both on and off Capitol Hill, Congress addressed the issue in the IRA. And last month’s guidance confirmed that commercial charging developers can claim the 30% tax credit for every charger they deploy (so long as they meet the prevailing wage and locational requirements).

“This change significantly boosts the credit’s beneficial impact on fast charging investment considering how many chargers are deployed per site. It’s also highly beneficial for retail, office, and multifamily dwelling owners, all of whom typically install more than one Level 2 charger in their garages if they choose to invest in them.

“Additionally, individuals retain their ability to claim the 30% credit for Level 2 charging in their homes, provided they are in an eligible location.

“Most importantly, after years of existing as a year-by-year tax credit–which often led to long lapses in its availability to taxpayers–30C is now in place through 2032. And certainty is always good for private investment.”

In other words, Democrats got something done while in charge, while Republicans basically never do — just cutting taxes for the super wealthy (who already have more money than they know what to do with) and cutting regulations that protect our air, protect our water, protect our economy, and protect our climate.