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Green regs should not be one size fits all

Green regs should not be one size fits all
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In a poor sign for the future of representative democracy, Minnesota is currently considering yielding some of its authority to regulate its own auto sales industry to California. The proposed rule would adopt California’s Clean Cars Mandate and force car manufacturers to send the same percentage of electric vehicles (EVs) to Minnesota as they send to car dealerships in California. Yet, Minnesotans have different needs and desires than Californians. This would — in effect — delegate power to Sacramento, a far-distant capital over which the people of Minnesota have no control.

Each state must consider the needs of its own population when adopting regulation. Yet, Minnesotans do not want EVs as much as Californians do, and, overall, EVs are not compatible with the needs of Minnesota’s consumers. Electric vehicles currently make up only 1.5 percent of total vehicle purchases in Minnesota, and, according to the Minnesota Automobile Dealers Association, only 5 percent of Minnesota residents believe they are very likely to even consider buying an EV.

Work vehicles such as pickup trucks are not yet available as EVs, and the price tags will be quite high when the first options do arrive in the next year or so. Furthermore, Minnesota weather is problematic for battery-powered cars. Frigid temperatures can kill batteries, and cold weather also strains an EV’s range as the batteries are drained trying to heat the vehicle.

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The lifestyle of Californians is more suited for EVs given the current technology. According to the 2010 census, 95 percent of Californians lived in urban areas while only 73 percent of Minnesotans did. Yet new EVs have a typical range of only 200 to 350 miles and can take 40 minutes to charge.

Of course, California does not take Minnesota into account when designing its regulations.

Perhaps the biggest drawback of this “California mandate” for Minnesotans would be the higher prices Minnesotans would see the next time they shop for a car or a truck. According to a recent release of Kelley Blue Book vehicle price data, the average electric vehicle transaction price was $53,701 while the industry average was $40,857 as of January 2021. This difference of nearly $13,000 is likely cost prohibitive for a lot of families. Perhaps there are enough families willing to spend that kind of money in California where 7.7 percent of households (more than 1 million households) have over $1 million in investable assets — but it does not mean the same is true in Minnesota where only 6.76 percent of households match that criteria. The California-style mandate would also raise the cost of traditional internal combustion vehicles in Minnesota, because local dealerships would be forced to devote resources and space to more than 18,000 EVs, many of which are not desired by the market and won’t move off of the lots. Thus, this regulation would make vehicle purchases in the state more expensive, harming Minnesota families and consumers.

Finally, the California regulation would not even provide the environmental benefits it is supposed to, because Minnesota has a different electric grid. Batteries must be charged, and in Minnesota the electric grid is not always as clean as we hope. According to the U.S. Energy Information Administration’s Hourly Electric Grid Monitor, electricity generation in Minnesota can actually result in significant air pollution. Take one recent day for example: Feb. 21, 2021. On that day, 50 percent of all Minnesota electricity needs were met by burning coal. A Minnesota resident might thus be powering her electric vehicle largely on coal, a much dirtier fuel than gasoline. Some advocates of the California EV mandate seem to support it for the alleged benefits for air quality, but increased use of battery powered cars in Minnesota would mean an increased need for electricity. This, in turn, could mean more air pollution in addition to additional strain on the existing grid.

This proposed regulation would be a negative choice for Minnesota and its residents. For the most part, EVs available today are not what Minnesotans want or need.

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No state should surrender itself to the priorities of another. California cannot become the regulator of choice for the United States, because one size does not fit all.

Ellen R. Wald is a senior fellow at the Atlantic Council’s Global Energy Center, and president of Transversal Consulting, a global energy and geopolitics consultancy. She is the author of “Saudi, Inc.,” a history of Aramco and how the Saudi royal family controls this multitrillion-dollar enterprise. Follow her on Twitter @EnergzdEconomy.