SACRAMENTO — In a decision with lasting implications for the growth of electric vehicles, state regulators on Thursday approved Volkswagen’s plan to invest nearly $1 billion in California’s EV network as penalty for its diesel-emission cheating scandal.
The plan approved by the state Air Resources Board would inject $800 million over 10 years into California’s electric vehicle market, including new, universal charging stations, a model “Green City” in Sacramento and education about zero-emission vehicles.
The massive investment could reshape the state’s budding network of electric vehicle charging stations while supporting Gov. Jerry Brown’s goal to have 1.5 million zero-emission vehicles on California roads by 2025.
San Jose and San Francisco are two of six cities slated for expanded community charging stations. A Volkswagen subsidiary, Electrify America, also will target low-income communities for at least 35 percent of the projects.
Chairwoman Mary Nichols said it was a long process to refine the plan, but added “we’ve gained a lot of confidence that it’s going to be a success.”
But critics said Volkswagen’s vast plan could chill competition and innovation in an emerging industry, and it snubs hydrogen fueling stations.
Volkswagen settled with federal and state regulators over a scheme to evade pollution standards in its 2- and 3-liter diesel-powered vehicles. The German automaker rigged software in nearly 600,000 diesel cars and trucks to pass federal emission tests, while the vehicles spouted unacceptable pollution levels.
In California, Volkswagen agreed to spend $1.2 billion through two separate environmental programs: at least $381 million for cutting pollution and $800 million for the infrastructure trust fund.
Volkswagen has also agreed to spend $1.2 billion for EV support throughout the rest of the country.
Environmentalists, lawmakers, automakers and EV charging companies fought over early details of the state plan, forcing the German automaker to include more guarantees to spend money in poor communities more likely to be polluted.
Sacramento Mayor Darrell Steinberg endorsed the deal, saying it would bring clean vehicle technology to underserved communities. “We will not waste this opportunity,” he said.
Maxwell Baumhefner, attorney for the Natural Resources Defense Council, said the plan will help the state catch-up with demand for EV stations.
“The timing is right,” he said, noting that Electrify America has already begun building projects in other states. “It’s time to start breaking ground.”
Most EV charging companies sent letters of support for the plan, but ChargePoint, a leading electric vehicle charging network based in Campbell, urged the board to create more oversight. ChargePoint Vice President Anne Smart testified Thursday that the company was “still disappointed with the lack of details” and concerned the plan could chill other EV charging investments throughout the state.
The Electrify America investment plan will bring charging stations along highways and into overlooked neighborhoods, helping define the state’s electric vehicle corridors for years.
The projects will be split in four, $200 million increments built over 30-month periods. The Air Resources Board will oversee the project and gather regular input, including from automakers and charging companies.
The first phase calls for $120 million to build 400 charging stations with between 2,000 and 3,000 chargers. About $75 million will be used to develop a high-speed, highway charging network, mostly consisting of 150 kilowatt fast-chargers. The other $45 million will build community charging stations in six metro areas: San Jose, San Francisco, Sacramento, Fresno, Los Angeles and San Diego.
Another $44 million will build a “Green City” in Sacramento. It will provide access to zero-emission vehicles to low-income residents, through ride-sharing and other programs.
As part of the 10-year comprehensive plan, Electrify America will build a nationwide network of fast-charging stations with universal technology. Mark McNabb, CEO of Electrify America, said the company wants to have an impact beyond its 10-year plan.
“This is our legacy,” he told board members.
Several board members expressed concern over whether Volkswagen would live up to its promises. Board member Hector De La Torre said the ARB would “trust but verify” the company’s progress. But, he added, “it’s our obligation to get this thing going.”
