The Biden Plan
The Biden Administration’s ambitious plan to mitigate global warming and climate change includes historical allocations to support every facet of the EV charging network. The $1 trillion infrastructure package recently approved by Congress includes $5 billion for highway charging stations critical to addressing consumer concerns about the range of travel. This allocation effectively doubles the collective investment by federal, state, and utility companies to date in EV charging infrastructure.
But proliferating charging stations give rise to another challenge: grid resiliency and power transmission. Considering the impacts of recent wildfires, hurricanes, and floods on critical infrastructure, an additional $2.5 billion and $3 billion for transmission lines and smart grids are intended to shore up the power delivery system backbone. A separate Bill still in congressional debate authorizes a 30% tax credit for developers of long-distance transmission lines.
Are these initiatives and incentives enough to move the needle on wider EV adoption? High-voltage transmission lines are critical to conveying power across power grids spanning multiple states. Topography, easements, and eminent domain challenges may slow the pace of connecting this charging network to generation since high-voltage transmission lines are regulated at the state level. On the other hand, momentum is gathering behind the global referendum on combatting climate change. This may facilitate greater collaboration among states for improvements to interstate transmission line infrastructure.
Increased Asset Value
Real estate developers and property managers acknowledge varying degrees in demand for EV charging based in part on demographics and geography. When revenue and cost models for EV charging are aligned to generate sufficient ROI on EV charging—and if federal subsidies, state incentives, and utility rebates continue to drive down net costs to implement and operate—developers and property managers may be well-positioned to reap the benefits of increased asset value, tenant retention, customer traffic, and sustainability metrics.