[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]




 
  SHARING THE ROAD: POLICY IMPLICATIONS OF ELECTRIC AND CONVENTIONAL 
                      VEHICLES IN THE YEARS AHEAD

=======================================================================

                                HEARING

                               BEFORE THE

                      SUBCOMMITTEE ON ENVIRONMENT

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FIFTEENTH CONGRESS

                             SECOND SESSION

                               __________

                              MAY 8, 2018

                               __________

                           Serial No. 115-125
                           
                           
                           
                           
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]                           




      Printed for the use of the Committee on Energy and Commerce

                        energycommerce.house.gov
                        
                        
                              ________ 

                U.S. GOVERNMENT PUBLISHING OFFICE
                   
32-281                   WASHINGTON : 2019                             
                        
                        
                        
                    COMMITTEE ON ENERGY AND COMMERCE

                          GREG WALDEN, Oregon
                                 Chairman
JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
  Vice Chairman                        Ranking Member
FRED UPTON, Michigan                 BOBBY L. RUSH, Illinois
JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
MICHAEL C. BURGESS, Texas            ELIOT L. ENGEL, New York
MARSHA BLACKBURN, Tennessee          GENE GREEN, Texas
STEVE SCALISE, Louisiana             DIANA DeGETTE, Colorado
ROBERT E. LATTA, Ohio                MICHAEL F. DOYLE, Pennsylvania
CATHY McMORRIS RODGERS, Washington   JANICE D. SCHAKOWSKY, Illinois
GREGG HARPER, Mississippi            G.K. BUTTERFIELD, North Carolina
LEONARD LANCE, New Jersey            DORIS O. MATSUI, California
BRETT GUTHRIE, Kentucky              KATHY CASTOR, Florida
PETE OLSON, Texas                    JOHN P. SARBANES, Maryland
DAVID B. McKINLEY, West Virginia     JERRY McNERNEY, California
ADAM KINZINGER, Illinois             PETER WELCH, Vermont
H. MORGAN GRIFFITH, Virginia         BEN RAY LUJAN, New Mexico
GUS M. BILIRAKIS, Florida            PAUL TONKO, New York
BILL JOHNSON, Ohio                   YVETTE D. CLARKE, New York
BILLY LONG, Missouri                 DAVID LOEBSACK, Iowa
LARRY BUCSHON, Indiana               KURT SCHRADER, Oregon
BILL FLORES, Texas                   JOSEPH P. KENNEDY, III, 
SUSAN W. BROOKS, Indiana                 Massachusetts
MARKWAYNE MULLIN, Oklahoma           TONY CARDENAS, CaliforniaL RUIZ, 
RICHARD HUDSON, North Carolina           California
CHRIS COLLINS, New York              SCOTT H. PETERS, California
KEVIN CRAMER, North Dakota           DEBBIE DINGELL, Michigan
TIM WALBERG, Michigan
MIMI WALTERS, California
RYAN A. COSTELLO, Pennsylvania
EARL L. ``BUDDY'' CARTER, Georgia
JEFF DUNCAN, South Carolina


                      Subcommittee on Environment

                         JOHN SHIMKUS, Illinois
                                 Chairman
DAVID B. McKINLEY, West Virginia     PAUL TONKO, New York
  Vice Chairman                        Ranking Member
JOE BARTON, Texas                    RAUL RUIZ, California
TIM MURPHY, Pennsylvania             SCOTT H. PETERS, California
MARSHA BLACKBURN, Tennessee          GENE GREEN, Texas
GREGG HARPER, Mississippi            DIANA DeGETTE, Colorado
PETE OLSON, Texas                    JERRY McNERNEY, California
BILL JOHNSON, Ohio                   TONY CARDENAS, California
BILL FLORES, Texas                   DEBBIE DINGELL, Michigan
RICHARD HUDSON, North Carolina       DORIS O. MATSUI, California
KEVIN CRAMER, North Dakota           FRANK PALLONE, Jr., New Jersey (ex 
TIM WALBERG, Michigan                    officio)
EARL L. ``BUDDY'' CARTER, Georgia
JEFF DUNCAN, South Carolina
GREG WALDEN, Oregon (ex officio)
  
                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. John Shimkus, a Representative in Congress from the State of 
  Illinois, opening statement....................................     1
    Prepared statement...........................................     2
Hon. Paul Tonko, a Representative in Congress from the State of 
  New York, opening statement....................................     3
Hon. Frank Pallone, Jr., a Representative in Congress from the 
  State of New Jersey, opening statement.........................     5
Hon. Greg Walden, a Representative in Congress from the State of 
  Oregon, prepared statement.....................................   125

                               Witnesses

Megan McKernan, Manager, Automotive Engineering, Automobile Club 
  of Southern California, on behalf of AAA.......................     7
    Prepared statement...........................................    10
Mitch Bainwol, President and CEO, Alliance of Automobile 
  Manufacturers..................................................    22
    Prepared statement...........................................    24
Genevieve Cullen, President, Electric Drive Transportation 
  Association....................................................    48
    Prepared statement...........................................    50
Bob Dinneen, President and CEO, Renewable Fuels Association......    57
    Prepared statement...........................................    59
Geisha Williams, President and CEO, Pacific Gas and Electric 
  Company, on behalf of the Edison Electric Institute............    69
    Prepared statement...........................................    71
Frank Macchiarola, Group Director, Downstream and Industry 
  Operations, American Petroleum Institute.......................    81
    Prepared statement...........................................    83
David Reichmuth, Senior Engineer, Clean Vehicles Program, Union 
  of Concerned Scientists........................................    90
    Prepared statement...........................................    92
Dylan Remley, Senior Vice President, Global Partners LP, on 
  behalf of the National Association of Convenience Stores and 
  Society of Independent Gasoline Marketers of America...........    97
    Prepared statement...........................................    99
    Answers to submitted questions...............................   131

                           Submitted Material

Op-Ed entitled, ``Automakers are Addressing Climate Change,'' by 
  Mitch Bainwol, submitted by Mr. Shimkus........................   126
Statement of Growth Energy, submitted by Mr. Shimkus.............   129


  SHARING THE ROAD: POLICY IMPLICATIONS OF ELECTRIC AND CONVENTIONAL 
                      VEHICLES IN THE YEARS AHEAD

                              ----------                              


                          TUESDAY, MAY 8, 2018

                  House of Representatives,
                       Subcommittee on Environment,
                           Committee on Energy and Commerce
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:15 a.m., in 
room 2322 Rayburn House Office Building, Hon. John Shimkus 
(chairman of the subcommittee) presiding.
    Members present: Representatives Shimkus, Barton, 
Blackburn, Olson, Johnson, Hudson, Walberg, Carter, Duncan, 
Tonko, Ruiz, Green, McNerney, Cardenas, Dingell, Matsui, and 
Pallone (ex officio).
    Staff present: Samantha Bopp, Staff Assistant; Daniel 
Butler, Staff Assistant; Kelly Collins, Staff Assistant; Jerry 
Couri, Chief Environmental Advisor; Margaret Tucker Fogarty, 
Staff Assistant; Jordan Haverly, Policy Coordinator, 
Environment; Ben Lieberman, Senior Counsel, Energy; Milly 
Lothian, Press Assistant and Digital Coordinator; Mary Martin, 
Deputy Chief Counsel, Energy & Environment; Drew McDowell, 
Executive Assistant; Brandon Mooney, Deputy Chief Energy 
Advisor; Austin Stonebraker, Press Assistant; Priscilla 
Barbour, Minority Energy Fellow; Jeff Carroll, Minority Staff 
Director; Jean Fruci, Minority Energy and Environment Policy 
Advisor; Tiffany Guarascio, Minority Deputy Staff Director and 
Chief Health Advisor; Caitlin Haberman, Minority Professional 
Staff Member; Rick Kessler, Minority Senior Advisor and Staff 
Director, Energy and Environment; and Alexander Ratner, 
Minority Policy Analyst.

  OPENING STATEMENT OF HON. JOHN SHIMKUS, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF ILLINOIS

    Mr. Shimkus. We will call the hearing to order and I will 
recognize myself 5 minutes for an opening statement.
    As most of you know, this is the Environmental 
Subcommittee's third hearing over the last 2 months dealing 
with fuels and vehicles. Our first hearing provided an overview 
of the future of personal transportation and I believe there 
were two key takeaways, one that the internal combustion engine 
running on petroleum and plant-based liquid fuels remain the 
major player in the decades ahead. And two that battery 
electric vehicles will continue to make inroads in the 
marketplace.
    Our next hearing expanded on that first point specifically 
that since the internal combustion engine and liquid fuels are 
going to be around for a while we should consider new ideas for 
improving them, namely, a high octane fuel standard matched 
with vehicles whose engines are optimized to run on these 
fuels. Ideally, a range of higher octane fuel blends could lead 
to as much if not more ethanol use than under the RFS while 
giving vehicles significantly improved performance and fuel 
economy.
    Today we focus on the second point, the battery electric 
vehicles, EVs, are gaining in market share and that the 
internal combustion engine has significant competition for the 
first time in a long time. This hearing will delve into the 
question of what these changes mean for everyone involved in 
fuels and vehicles and most importantly what they mean for 
consumers. I thank our diverse panel for being here today and 
providing a variety of perspectives.
    I should add that we are focusing on EVs and not other 
alternative vehicles like natural gas vehicles or fuel cells 
for example, mainly because projections from the Energy 
Information Administration see EVs as the fastest growing 
alternative. Of course, only time will tell which vehicle types 
will catch on.
    When we think of larger EV fleets, one of the first 
questions that comes to mind is where all the extra electricity 
is going to come from to power them. After all, EVs are not 
going to be a good deal for consumers if the electricity is 
expensive. I am certain we will hear from several witnesses on 
this point, but I would like to add that I believe coal-fired 
generation will have an important role in providing affordable 
electricity and making an EV future work.
    Fueling infrastructure is also an issue. We currently have 
150,000 liquid fuel retailers along our nation's roads and 
highways and you can fill up in about 5 minutes. It is hard for 
EVs to compete with that level of convenience, so charging 
infrastructure and charging times are still a challenge. As the 
Nation's vehicle mix changes, we may need to re-think past fuel 
and vehicle policies. For example, the Renewable Fuel Standard 
was last amended back in 2007 when we assumed that gasoline 
demand was on a one-way trip higher. We know now that those 
assumptions were overstated and will be even more so if EVs 
continue to gain market share. This doesn't necessarily mean 
the RFS needs to be amended in light of EVs, but Congress 
should at least look at the matter.
    Automobiles are the second biggest family expense after 
home so the stakes are high. I look forward to a thorough 
discussion and again I thank our witnesses.
    I have some time. I will yield to the gentlelady from 
Tennessee.
    [The prepared statement of Mr. Shimkus follows:]

                Prepared statement of Hon. John Shimkus

    As most of you know, this is the Environment Subcommittee's 
third hearing over the last two months dealing with fuels and 
vehicles. Our first hearing provided an overview of the future 
of personal transportation, and I believe there were two key 
takeaways--one, that the internal combustion engine running on 
petroleum and plant-based liquid fuels will remain the major 
player in the decades ahead, and--two, that battery electric 
vehicles will continue to make inroads in the marketplace.
    Our next hearing expanded on the first point, specifically 
that since the internal combustion engine and liquid fuels are 
going to be around for a while, we should consider new ideas 
for improving them, namely a High-Octane Fuel Standard matched 
with vehicles whose engines are optimized to run on these 
fuels. Ideally, a range of higher-octane fuel blends could lead 
to as much, if not more ethanol use than under the RFS, while 
giving vehicles significantly improved performance and fuel 
economy.
    Today, we focus on the second point, that battery electric 
vehicles (EVs) are gaining in market share, and that the 
internal combustion engine has significant competition for the 
first-time in a long-time. This hearing will delve into the 
question of what these changes mean for everyone involved in 
fuels and vehicles, and most importantly what they mean for 
consumers. I thank our diverse panel for being here today and 
providing a variety of perspectives.
    I should add that we are focusing on EVs and not on other 
alternative vehicles, like natural gas vehicles or fuel cells 
for example, mainly because projections from the Energy 
Information Administration see EVs as the fastest growing 
alternative. Of course, only time will tell which vehicle types 
will catch on.
    When we think of larger EV fleets, one of the first 
questions that comes to mind is where all the extra electricity 
is going to come from to power them. After all, EVs are not 
going to be a good deal for consumers if the electricity is 
expensive. I'm certain we will hear from several witnesses on 
this point, but I would like to add that I believe coal-fired 
generation will have an important role in providing affordable 
electricity and making an EV future work.
    Fueling infrastructure is also an issue. We currently have 
150,000 liquid fuel retailers along our nation's roads and 
highways, and you can fill up in about 5 minutes. It is hard 
for EVs to compete with that level of convenience, so charging 
infrastructure and charging times are still a challenge.
    As the Nation's vehicle mix changes, we may need to rethink 
past fuel and vehicle policies. For example, the Renewable Fuel 
Standard was last amended back in 2007 when we assumed that 
gasoline demand was on a one-way trip higher. We now know that 
those assumptions were overstated and will be even more so if 
EVs continue to gain market share. This doesn't necessarily 
mean the RFS needs to be amended in light of EVs, but Congress 
should at least look at the matter.
    Automobiles are the second biggest family expense after a 
home, so the stakes are high. I look forward to a thorough 
discussion, and again thank our witnesses.

    Mrs. Blackburn. Thank you, Mr. Chairman, and thank you to 
the witnesses for being here and for this hearing. In my 
district in Tennessee we have Nissan which is located right in 
Franklin, we have GM at the Spring Hill facility working on the 
Ecotec engine, and we hear from automakers and auto dealers 
about EVs. We are interested in looking at going forward on the 
strength of that battery, and the chairman has well laid out 
some of the questions that we as a committee have.
    We also are looking at the acceptance by the public. Last 
year in my district, in 2016, 67 percent of the cars that were 
sold were in the truck category. They were small trucks, light 
trucks, SUVs, crossovers. And looking at acceptance and then 
looking at how the EVs will move into that market that is where 
I will center my questions with you today. I look forward to 
hearing what you all have to say about this. And as always with 
us in Tennessee this is an interesting topic and we welcome 
you. I yield back.
    Mr. Shimkus. The gentlelady yields back to me. Anyone else 
seeking the last 30 seconds, if not, I yield back my time and I 
recognize the ranking member, my friend Mr. Tonko from New 
York, for 5 minutes.

   OPENING STATEMENT OF HON. PAUL TONKO, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF NEW YORK

    Mr. Tonko. Thank you, Mr. Chairman. Before we start the 
clock, if I might I want to acknowledge the presence of Albany 
County Executive Dan McCoy who just joined us. It is great to 
have you in town, Dan, and thank you for your work on 
transportation issues.
    Thank you, Mr. Chair. And thank you to our witnesses for 
joining us this morning. Much like this subcommittee's future 
of transportation fuels and vehicles hearing in March, the 
assembled panel represents a good overview with diverse 
perspectives on today's issue, the current state and future of 
electric vehicles. In recent years, despite more options for 
fuels and improvements in fuel economy, transportation has 
become the leading source of greenhouse gas emissions in the 
United States.
    Greenhouse gas reductions are occurring much more quickly 
in the power sector. It has become clear that shifting 
transportation emissions into electricity generation is not 
only an effective, but a necessary means for our country to 
make major strides to address climate change. EVs will continue 
to become cleaner as the Nation's electricity supply moves 
toward a more low and more zero emissions energy resources. 
This has already been recognized by countries around the world, 
so it is my belief that electric vehicles are not only 
essential they are inevitable.
    But we do not need to look as far as China or Europe to see 
the desire to promote EVs. Cities and towns across our country 
are launching smart community projects, many including EV 
charging sites to make their communities more connected and 
efficient. I expect we will hear about the benefits of EVs, 
chief among them the opportunities to improve air quality, 
reduce gas emissions, and save consumers from fuel costs.
    Despite these benefits, it is important to acknowledge that 
the internal combustion engine is not going to disappear 
overnight. In the subcommittee's previous hearing we heard 
estimates of how long it might take for the Nation's vehicle 
fleet to turn over. Even with a growing adoption rate of EVs, 
conventional vehicles will remain a staple of our vehicle fleet 
for decades to come.
    Today we should hear about a few aspects of the future of 
electric vehicles. First, what is the state of EV technology 
development? In part due to investments by the Department of 
Energy in recent years, batteries' costs have declined and 
their effectiveness have improved dramatically. According to 
DOE's 2016 Revolution Now report, the cost of EV batteries 
produced at high volume decreased by 73 percent between 2009 
and 2016. Automakers are now offering many more vehicle options 
with ever-increasing ranges at a variety of price points. 
Continued Federal investments in R&D could unlock the next big 
breakthrough in fast-charging battery capabilities or vehicle-
to-grid smart technologies.
    Second, what barriers still exist to broader EV adoption? 
These may include increasing consumer education and acceptance, 
deploying new charging infrastructure, and addressing 
regulatory hurdles. Regulatory action often lags behind 
technology. This has been true of charging infrastructure which 
is outstanding questions about where to build it, who can own 
it, and how to ensure broad public access at affordable rates. 
Some of these questions will be determined by state governments 
and PUCs such as the development of off-peak charging rate 
structures. But clearly there are things Congress can do to 
incentivize EV purchases and infrastructure build-out.
    Finally, where are we heading? The trends are positive for 
greater EV adoption. I want to highlight a portion of Ms. 
McKernan's testimony, and I apologize for spoiling it, but what 
A-A-A, AAA, has identified is worth mentioning more than once. 
Between 2017 and '18 there were pretty significant shifts in an 
increasing number of Americans that want to buy electric for 
their next vehicle and a decreasing number of Americans 
concerned about access to charging locations which is still the 
biggest concern for buyers. It is clear that even in a short 
amount of time, consumer acceptance is growing and range 
anxiety is beginning to decline. My guess based on the trends 
is that concerns over range, charge time, and price will 
continue to decline especially as more infrastructure is built 
to support the growing EV fleet.
    Perhaps the most important trend which is outside of 
Congress's control is that many other countries have already 
set ambitious EV goals. Some are even proposing to ban internal 
combustion engines entirely in the decades ahead. EVs will be 
heavily utilized around the world which is why I believe this 
transition is inevitable. It is my hope that our Federal R&D 
investment continue to support the research, design, and 
manufacture of EVs here in the U.S. in the face of increasing 
global competition and market opportunities.
    Mr. Chair, I believe that cleaning up our transportation 
sector is important regardless of our vehicle and fuel mixes. 
That means improving fuel economy, developing new low emissions 
liquid fuels such as advanced cellulosic biofuels, and 
deploying a much greater number of electric vehicles. If we 
continue to identify and address barriers, I am certain EV 
adoption will increase substantially.
    So I look forward to hearing more about the current state 
of EVs as well as what Federal, state, and local policymakers 
can do to continue to incentivize adoption to ensure that the 
trend of greater EV deployment continues. With that I thank 
you, Mr. Chair, and I yield back.
    Mr. Shimkus. The gentleman yields back his time and the 
chair thanks the gentleman. The chair now recognizes the 
ranking member of the full committee, Congressman Pallone from 
New Jersey, for 5 minutes.

OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE 
            IN CONGRESS FROM THE STATE OF NEW JERSEY

    Mr. Pallone. Thank you, Mr. Chairman. I am pleased that we 
are finally having a hearing to discuss electric vehicles or 
EVs. These vehicles are transforming our transportation sector 
to the benefit of both consumers and our environment, and I 
strongly support efforts to advance electric vehicles whether 
they be tax credits for EV purchases, assistance for the 
deployment of EV charging infrastructure, and Federal 
investment in vehicle and battery research.
    Unfortunately though, progress in transportation 
modernization and fuel economy is under direct attack by the 
Trump administration. Recent reports indicate that the 
administration plans to undermine the 2012 agreement made 
between the auto industry, the State of California, advocates, 
and the Obama administration to increase the efficiency of our 
transportation fleet.
    And this is extremely shortsighted and now comes word that 
President Trump intends to preempt California, a move that 
appears driven mainly by Administrator Pruitt and right-wing 
ideologues to benefit their favorite special interest, the 
petroleum industry. At the same time, the administration is 
indiscriminately giving companies of all sizes waivers of the 
Renewable Fuel Standard undermining that program as well.
    So the administration's efforts to gut enhanced fuel 
economy standards couldn't come at a worse time. Emissions in 
the transportation sector are continuing to grow. They now 
exceed those of the electricity sector. In 2017, the cost of 
weather related disasters hit a record $306 billion, and just 
last month we hit another grim milestone. Scientists recorded 
concentrations of heat-trapping carbon pollution in the 
atmosphere above 410 parts per million for an entire month. The 
last time carbon dioxide concentrations were at that level was 
3 million years ago when seas were 66 feet higher and human 
beings did not exist.
    So we can't continue down this road. To avoid further 
catastrophic climate impacts we must use every tool available 
to reduce greenhouse gases. EVs are one of our most critical 
tools to do this. In the face of a drastically changing climate 
we can't afford to move backward on vehicle electrification. I 
believe the future for electric vehicles is promising and their 
lower operating and maintenance costs offer significant 
benefits to American consumers.
    As technologies improve and costs continue to climb, 
consumers will continue to demand cars that save money and help 
preserve a livable planet for future generations. EVs have been 
sharing the road for some time now with conventional vehicles. 
As with any transformative technology, there are still various 
to widespread EV adoption, some of those are technological, 
other barriers are created by shortsighted entities who have a 
financial stake in the status quo and little stomach to push 
forward the electric platform that most auto companies' CEOs 
admit is critical for the future of their industry.
    And the growth of the EV market even in the face of scant 
advertising and limited availability is a testament to American 
innovation and consumers' desire for these vehicles. Continued 
investment in EVs and charging infrastructure can only yield 
positive benefits for our environment, the transportation 
industry, and the American people. So we need smarter energy 
infrastructure and cleaner vehicles. Many cities across the 
country are taking the lead, and it is time that we do that at 
the Federal level to support these efforts. I would like to 
yield the remainder of my time to Congresswoman Dingell.
    Mrs. Dingell. Thank you, Ranking Member Pallone. We have 
all been paying attention to the discussion about fuel economy 
standards and it is clear that electric vehicles are an 
important part of getting there. The fact of the matter is auto 
companies are building EVs, but we need to figure out how we 
are going to encourage more consumers to buy them and that is a 
challenge we all have to tackle together. We need to use this 
hearing to understand the barriers to EV adoption and 
deployment, how we combat range anxiety, and we build out an 
infrastructure that we need to support electric vehicles.
    This closely relates to fuel economy standards and I will 
talk about this more on my questioning, but want to close with 
a final comment. We must maintain one national program for fuel 
economy standards that keeps California at the table. We need 
stringent standards that improve over time but that also 
reflect current marketplace realities like the low cost of gas 
and low rate of EV adoption.
    We are entering a critical phase. We can either come 
together on a negotiated solution that continues upward 
progress and sets standards through 2030, or we can have a 
costly legal battle where nobody will win and we cede American 
leadership in this area to overseas. I hope that this 
administration, California, and other stakeholders will roll up 
their sleeves and get to work on a negotiated deal on fuel 
economy. Failure is simply not an option, it hurts too many 
people. I yield back the balance of my time.
    Mr. Shimkus. And the gentleman yields back his time.
    The chair wants to thank you all for joining us today. It 
is a diverse and a very interesting panel. And so we will 
start, first of all, and remember your full statements have 
been submitted for the record, you will have 5 minutes to kind 
of summarize that and we will go into a question and answer 
period.
    So we will begin with Megan McKernan, Manager, Automotive 
Engineering, Automobile Club of Southern California, on behalf 
of AAA. Welcome, you are recognized for 5 minutes.

STATEMENTS OF MEGAN MCKERNAN, MANAGER, AUTOMOTIVE ENGINEERING, 
AUTOMOBILE CLUB OF SOUTHERN CALIFORNIA, ON BEHALF OF AAA; MITCH 
      BAINWOL, PRESIDENT AND CEO, ALLIANCE OF AUTOMOBILE 
  MANUFACTURERS; GENEVIEVE CULLEN, PRESIDENT, ELECTRIC DRIVE 
  TRANSPORTATION ASSOCIATION; BOB DINNEEN, PRESIDENT AND CEO, 
  RENEWABLE FUELS ASSOCIATION; GEISHA WILLIAMS, PRESIDENT AND 
CEO, PACIFIC GAS AND ELECTRIC COMPANY, ON BEHALF OF THE EDISON 
    ELECTRIC INSTITUTE; FRANK MACCHIAROLA, GROUP DIRECTOR, 
    DOWNSTREAM AND INDUSTRY OPERATIONS, AMERICAN PETROLEUM 
  INSTITUTE; DAVID REICHMUTH, SENIOR ENGINEER, CLEAN VEHICLES 
  PROGRAM, UNION OF CONCERNED SCIENTISTS; AND, DYLAN REMLEY, 
  SENIOR VICE PRESIDENT, GLOBAL PARTNERS LP, ON BEHALF OF THE 
   NATIONAL ASSOCIATION OF CONVENIENCE STORES AND SOCIETY OF 
           INDEPENDENT GASOLINE MARKETERS OF AMERICA.

                  STATEMENT OF MEGAN MCKERNAN

    Ms. McKernan. Chairman Shimkus, Ranking Member Tonko, and 
members of the subcommittee, thank you for the opportunity to 
testify at today's hearing. My name is Megan McKernan and I am 
the Manager of Automotive Engineering for the Automobile Club 
of Southern California. In that role I lead the team of 
automotive engineers responsible for evaluating alternative 
fuel vehicles for our annual Green Car Guide. I am also a race 
car driver, so I am one of those lucky people that gets to 
apply my passion for cars with my job.
    With over 100 years of experience, AAA is a trusted, 
independent authority in the automotive industry. AAA experts 
serve on SAE committees responsible for setting automotive 
standards and participate in the Auto-ISAC working group 
responsible for vehicle cybersecurity guidelines. Most 
importantly, AAA serves 58 million members and is a leading 
traffic safety advocate. In the time I have today I would like 
to focus on a few key points from the more detailed testimony 
submitted for the record.
    AAA has invested significant resources into understanding 
and evaluating vehicle ownership trends, fuels, automated 
vehicle technologies and electric vehicles, and surveying 
consumer trends. One of the key investments we have made in 
this area is the Automobile Club of Southern California's 
Automotive Research Center, ARC, located in Los Angeles, a 
premier vehicle emission test laboratory featuring state-of-
the-art facilities and equipment operated by a team of highly 
qualified engineers and technicians.
    The pace of battery EVs and plug-in hybrid vehicles being 
introduced into the national fleet is likely to accelerate 
especially as technology trends ramp up due to changing 
consumer preferences, lower ownership costs, and the adoption 
of connected and autonomous vehicles. In fact, according to a 
new AAA survey, 20 percent or 50 million Americans are likely 
to go electric for their next vehicle purchase, a jump of five 
percentage points from just a year ago.
    Since 2010, the AAA Green Car Guide has become a trusted 
source of information for buyers who are looking to maximize 
the value of their purchase. A team of ARC engineers with more 
than 75 years of combined automotive experience conduct the 
evaluations of a variety of new alternative vehicles including 
hybrid or plug-in hybrid, battery electric, compressed natural 
gas, hydrogen, other alternative fuel vehicles, or have 
category leading fuel economy set by the U.S. EPA for the 
annual AAA Green Car Guide.
    All vehicles are evaluated in thirteen different categories 
in real-world and test track evaluations using testing 
procedures developed by SAE standards and custom procedures 
employed by the ARC to provide useful information to members 
and consumers. Vehicles are rated on the criteria that matter 
most to car buyers including ride quality, safety, and 
performance. In 2018, we evaluated 74 vehicles and based on our 
findings awarded AAA's Top Green Vehicle awards in several 
categories. The complete guide has also been submitted for the 
official record and is available online for consumers.
    To better understand what the public thinks about EVs, AAA 
also conducted a consumer attitude survey on EV purchasing 
trends. So what did we find? Two in ten Americans say they are 
likely to buy an electric vehicle the next time they are in the 
market for a new or used vehicle, an increase from 15 percent 
over 2017 survey results. We also learned concern for the 
environment is the top reason consumers are likely to purchase 
an EV, followed closely by lower long-term ownership costs, 
access to the newest technologies, and then access to car pool 
lanes.
    And range anxiety, previously a serious concern for 
consumers, is beginning to ease. More charging options is 
reducing consumer anxiety and making EVs an attractive vehicle 
purchase and viable transportation option for a variety of 
trips, including longer journeys that may require fueling 
options as convenient as filling up at the local gas station. 
With more consumers looking to purchase an EV, the AAA Green 
Car Guide is a valuable resource for consumers who are looking 
for the right electric vehicle or alternative fuel vehicle for 
their next purchase.
    Over the coming years, automakers will make EVs a higher 
priority in their research and development efforts and the next 
generation of EVs will feature the most advanced technology our 
nation's roads have ever seen. Whether it is EV or autonomous 
vehicle, the importance of well-maintained roads and bridges 
cannot be ignored. Infrastructure improvements and system 
upgrades will need to incorporate electric vehicle charging, 
intelligent transportation, and connected vehicle technologies 
to ensure networks are built and maintained to support all 
levels of connectivity that will benefit users and improve 
safety.
    In closing, AAA is committed to doing its part to provide 
accurate information to help consumers on all things 
automotive. Through our continued vehicle research and consumer 
surveys to our work in traffic safety, we will look for 
opportunities to make the Nation's roads, vehicles, and drivers 
safer. Thank you.
    [The prepared statement of Ms. McKernan follows:]
    
    
    
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    Mr. Shimkus. Thank you.
    Now I would like to recognize Mr. Mitch Bainwol, President 
and CEO of the Alliance of Automobile Manufacturers. Sir, you 
are recognized for 5 minutes.

                   STATEMENT OF MITCH BAINWOL

    Mr. Bainwol. Thank you, Chairman Shimkus and Ranking Member 
Tonko, members of the committee. I am Mitch Bainwol. I run the 
Auto Alliance which is comprised of 12 manufacturers 
headquartered in the U.S., in Europe, and in Japan, and we are 
responsible for about 80 percent of the vehicles on the road 
today in this country. Next slide.
    [Slides shown.]
    Mr. Bainwol. Rather than read testimony, I am going to run 
through a short PowerPoint deck and hopefully it will be a 
little lively and at least some good images here for you.
    The first slide shows world vehicle sales 1996, 2006, and 
2016 by region, and what you see is one phenomenal growth in 
sales. So mobility is alive and well and we are probably, 2017, 
closer to a hundred million units. When you think about the 
next decade a billion cars will be put on the roads of the 
world. What you also see is that the U.S. is a very mature 
market. We are relatively stable in terms of sales. And you see 
China ramping up, so China is clearly the world leader in terms 
of unit sales. The question for us really, ultimately, is who 
will be the world leader when it comes to innovation and we 
want that to happen here. Next slide.
    We are talking today about powertrain. I think when you 
reflect on the broader question of mobility there are four 
different trends going on. One is powertrain, another is 
connectivity, another is the trend toward autonomy which this 
committee has addressed, thankfully, and the last is sharing, 
and these are all independent trends but they are interactive. 
And when you have a conversation about powertrain I think you 
have to look in the context of the broader question. Next 
slide.
    Around the world, and this was, I think, suggested in Mr. 
Tonko's statement, we are seeing policy made to either phase 
out liquid fuel, ban liquid fuel, or set EV targets. So this is 
happening in a very, very dramatic way. We are global companies 
and we are having to respond to that global reality when it 
comes to policy. That is also happening in the U.S., more so in 
California and what are called ZEV states, states that follow 
the California model. But we are seeing policy induce 
electrification, and the question really is how you align what 
is happening in the marketplace with what is happening with 
policy. Next slide.
    What you see here, very quickly, is a timeline of 
announcements by the companies responding to the global 
interest in electrification. Next slide.
    You see the green bars show from 2011 through 2017 the 
number of models available to the public when they go into 
showrooms to buy a car and it has gone up by about 980 percent 
from 2011 to 2017. So we are offering many more models but 
consumers literally are not buying it just yet. EVs represent 
about 1.2 percent of the marketplace. If you add in hybrids you 
are getting closer to about 3 percent. The next slide tells you 
why this is in part happening and one reason is the success of 
the conventional engine. From 2005 to 2017, the conventional 
engine is up 30 percent in terms of fuel economy and so that 
does make the question in terms of the economic calculus a more 
complicated one for the consumer. Next slide.
    Here you see the relationship between gas prices and the 
adoption, the purchase of alternative powertrains and it looks 
like an Olympic event. It looks like synchronized swimming. It 
is just directly correlated, and so policymakers can make 
policy but what happens in the marketplace has a huge impact in 
terms of buying behavior.
    The next slide shows the bottom line in terms of where we 
are and the red line is the share of the marketplace that is 
gas and diesel. The blue line is the share of the marketplace 
that is a combined hybrid, plug-in, and electric and the 
circled percentages are the delta between gas, diesel, and 
alternative powertrains. And from 2011 to 2017 that net has 
gone from 96 percent to 95 percent, so in other words it hasn't 
really moved. We all expect it is going to change at some 
point, but it has not yet changed.
    I have two more slides. This next one is a bit complicated, 
but I can deconstruct it pretty quickly and easily. It 
reflects, and I believe you may have a copy of this and we will 
make sure it is available to you, this reflects the ZEV 
percentages in 2013 and in 2017 by the states on the Energy and 
Commerce Committee. So, overall, ZEVs were 0.6 of the 
marketplace in 2013, in 2017 nearly doubled to 1.13. If you 
look at California, there you see a material change.
    So, for the California members, up from 2.34 to 4.81, 
California is alone in this respect. Other states are not 
moving quite as rapidly. It is also important to point out 
Georgia, where the ZEV credit, the tax credit, was removed and 
there the number actually fell. So there is a direct 
relationship between the availability of tax credits and 
adoption.
    Finally, the last slide, I just want to make a point that 
the job of Congress is hard and sometimes policies conflict. If 
you care about the environment and that is your driving passion 
in CO2 reduction then you are looking to promote 
electrification and that all makes sense, but that obviously 
drains the trust fund. If you are looking to build an 
infrastructure then you want a robust gas fund and that 
unfortunately is inhibited by electrification and by the 
improvements in conventional engines.
    At any rate, I appreciate the opportunity to testify and 
this is a kind of sardine panel, but I would look forward to 
the questions.
    [The prepared statement of Mr. Bainwol follows:]
    
    
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    Mr. Shimkus. Thank you very much.
    The chair now recognizes Genevieve Cullen, President, 
Electric Drive Transportation Association. You are recognized 
for 5 minutes. Thanks for being here.

                 STATEMENT OF GENEVIEVE CULLEN

    Ms. Cullen. Thank you. Good morning Chairman Shimkus, 
Ranking Member Tonko, and members of the committee. I am 
Genevieve Cullen, President of the Electric Drive 
Transportation Association. Our membership includes the entire 
electric drive value chain including vehicle, battery, and 
component manufacturers as well as utilities and infrastructure 
developers who are advancing e-mobility. Using electricity to 
power a hybrid, plug-in hybrid, battery and fuel cell electric 
vehicles enhances our energy security with fuel diversity and 
ensures our competitiveness in the global race for new 
technology while reducing transportation costs and emissions.
    A brief look at the numbers, the same numbers that Mitch 
uses but from a slightly different lens shows a growing market 
for electric drive, since the commercial scale introduction of 
plug-in vehicles in late 2010 the electric drive segment has 
grown from two to almost fifty models including three models of 
fuel cell vehicles. More than 800,000 electric vehicles have 
been sold to date and annual sales are continuously increasing. 
2017 sales showed a 71 percent increase over 2015 in the face 
of stable and low gas prices.
    The diversity of the electric drive market is also 
increasing. We are seeing a expanded offerings across a range 
of price points in vehicle categories including trucks, buses, 
and mobile equipment. Looking ahead, a survey of major industry 
and analyst projections shows uptake increasing substantially 
in the next decade and beyond. For instance, the Boston 
Consulting Group predicts that EVs could be more than 20 
percent of the U.S. new car registrations by 2030. Bloomberg 
New Energy Finance estimates that global electric drive sales 
will reach parity with internal combustion sales by 2038.
    While the numbers and timelines have some variability, the 
direction of the market is clear. Electrification will shape 
the future of mobility. The global opportunity in e-mobility 
has not gone unnoticed by our competitors. Although not alone 
in its pursuit, China is making an aggressive push to dominate 
this market and they could succeed. The Wall Street Journal 
recently reported that 40 percent of global investment in 
electric vehicles is occurring in China. Meanwhile, electric 
charging and hydrogen fueling infrastructure are expanding to 
serve this market. DOE reports more than 20,000 charging 
stations in operation today. More will be needed to serve 
diverse driving and charging needs.
    Electric transportation advances are also reinforcing 
growth in automation, connectivity, and shared mobility. While 
the continuum of autonomous technology is being built into 
vehicles today is not exclusive to it, electric drive is in 
many ways the optimal partner. The smart technologies of the 
future will be built on electrified platforms. In that vein, we 
thank the committee for its leadership in this area through 
H.R. 3388, the SELF DRIVE Act. The advances we have been 
talking about have positive implications for consumers, 
businesses, and the country.
    For drivers, e-mobility means wider options and reduced 
costs. For the country, the growth of this market is building 
an advanced technology value chain that is creating jobs, 
expanding manufacturing in the United States, and bolstering 
our position in the global race for electrification. An 
electrified transportation sector will also increase our energy 
security, reducing our reliance on a single transportation fuel 
while reducing transportation emissions.
    So where do we go next? To secure these benefits and the 
U.S. position in the global marketplace we need to grow. I 
think we can all agree to that. We are still an emerging market 
of new technologies pushing to deliver ever-enhanced 
performance at reduced cost while building volume. To achieve 
that scale, the industry is investing in technology 
development, market expansion, and infrastructure at the local, 
regional, and national scale. Public policies can reinforce 
that work and speed achievement of these benefits.
    In conclusion, industry investment trends, technology 
advances, and global market imperatives all point to 
electrification. Accelerating that movement is a critical 
opportunity for continued United States leadership in a market 
that we built. Neglecting that opportunity is a choice to 
follow rather than lead in the world market for electric 
transportation. Again I thank you for the opportunity to be 
here today and I look forward to your questions.
    [The prepared statement of Ms. Cullen follows:]
    
    
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    Mr. Shimkus. Thank you very much. The chair now recognizes 
Bob Dinneen, President and CEO of the Renewable Fuels 
Association. Welcome, you are recognized for 5 minutes.

                    STATEMENT OF BOB DINNEEN

    Mr. Dinneen. Good morning Chairman Shimkus, Ranking Member 
Tonko, and members of the subcommittee. I greatly appreciate 
the opportunity to be with you again to present the views of 
the American fuel ethanol industry.
    Liquid fuels and internal combustion engines will continue 
to drive America for decades to come and despite what you might 
hear, these are not fully mature technologies. Plenty of room 
remains for the improved performance of both. We need to make 
sure that the technologies literally and figuratively driving 
our economy compete in a policy environment that maximizes 
efficiency and carbon reduction and allows fair access to a 
market that has largely been closed to competition for more 
than a century.
    As you heard at your hearing 2 weeks ago, ethanol is the 
lowest cost and cleanest source of octane on the planet and 
research has shown that a mid-level ethanol blend could deliver 
tremendous efficiency benefits if used in an optimized engine. 
However, if the move toward higher octane fuels simply 
encourages more hydrocarbon aromatics, a huge opportunity will 
be lost and consumers will be paying more for fuels that 
pollute more, are imported more, and increase carbon more.
    This committee has already led when it comes to 
transformative energy policy. The RFS, for example, remains a 
beacon of success that is being emulated as other countries 
seek to expand their production and use of renewable fuels to 
address the same energy, economic, and environmental 
imperatives that drove this committee to pass the RFS a decade 
ago.
    Yes, there are critics of the policy, those who want to 
ignore the economic and environmental consequences of 
unfettered petroleum use, but consumers appreciate the savings 
at the pump resulting from the increased use of lower priced 
biofuels. Farmers appreciate an important value-added market 
that means fewer taxpayer dollars being spent on farm programs, 
environmentalists recognize that we have made an important 
first step in addressing global climate change, and national 
security hawks most certainly value the fact we are relying 
more on renewable fuels produced in the Midwest and less on 
fossil energy from the Middle East.
    That is why EPA Administrator Pruitt's campaign to destroy 
RFS demand is being met with such virulent opposition. By 
issuing secret hardship waivers to highly profitable 
refineries, by ignoring a court-ordered reallocation of 500 
million gallons in 2016 RFS obligations, and by forgiving more 
than half of the RFS obligation for an aging and noncompetitive 
refinery that has scapegoated the RFS. EPA has done great 
damage to this important program. Those actions send the wrong 
signals to the fuel producers and automakers who are poised to 
make huge investments in the next generation of fuels and 
vehicles.
    The ethanol industry recognizes a broad array of electric 
vehicle technologies are on the horizon and we want them to 
succeed. We do not see electric vehicles as a threat, rather, 
we see electric vehicles as fellow travelers on our road toward 
energy independence and decarbonization. It will take all 
innovative technologies for us to succeed. Indeed, I will tell 
you, although I would appreciate it if you didn't tell my board 
of directors that my wife drives a hybrid electric car. She 
loves it, I don't. It is too small for me, big surprise. I much 
prefer my flex-fuel Chevy pickup, but that just underscores my 
point.
    There will be consumers for whom electric vehicles work 
well for their taste, their lifestyle, and their wallets and 
there will be consumers who will continue to prefer liquid 
transportation fuels. Public policy needs to make room for both 
and ought not put the heavy finger of government on the scale 
in favor of any one technology. Today, for example, EVs are 
effectively treated as zero emission vehicles because the 
upstream source of the electricity is not considered. That is 
not only inaccurate, it provides EVs with an incentive relative 
to other decarbonization technologies. Compliance values from 
all technologies should be based on full, direct, well-to-
wheels lifecycle emissions that would allow for an apples-to-
apples treatment of their greenhouse gas emissions.
    We believe ethanol and EVs can play a complementary role in 
the long term. In 2016, Nissan unveiled the prototype of a 
vehicle powered by solid oxide fuel cells that uses ethanol as 
the fuel. Last month, Toyota revealed its first prototype of a 
hybrid electric vehicle powered by a flexible fuel internal 
combustion engine that can run on any blend of ethanol and 
gasoline. Ford has also experimented with ethanol flex-fuel 
hybrid EV technology.
    A global policy shift is taking place driving 
transportation toward low carbon technologies. Renewable fuels 
have a key role to play in the development of this new 
mobility. We believe a combination of technologies with ethanol 
could be the answer so long as there is a level playing field. 
Together we can work to increase efficiencies and reduce costs 
for consumers, it is not one or the other. Thank you and I look 
forward to our questions.
    [The prepared statement of Bob Dinneen follows:]
    
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    Mr. Shimkus. Thank you.
    The chair now recognizes Geisha Williams, President and CEO 
of Pacific Gas and Electric Company, on behalf of the Edison 
Electric Institute. You are recognized for 5 minutes. Welcome.

                  STATEMENT OF GEISHA WILLIAMS

    Ms. Williams. Thank you, Chairman Shimkus. Thank you, 
Ranking Member Tonko, for the opportunity to speak before your 
committee this morning. It is on, yes. I will make it up a 
little bit closer, all right.
    I am Geisha Williams, CEO and President of PG&E 
Corporation, the parent company of Pacific Gas and Electric. 
Pacific Gas and Electric is the largest combined electric and 
natural gas energy company in California. PG&E is here today as 
a member of the Edison Electric Institute. Together, EEI's 
member companies provide power to 220 million Americans across 
all 50 states.
    We are also active and committed partners in the drive to 
grow America's electric transportation sector. As such, we 
applaud your focus on the policy implications of a 
transportation future in which electric vehicles will represent 
a growing share of the vehicles on our roads. Let me say 
clearly, we see electric transportation as a vital opportunity. 
It is an opportunity to make more efficient and economic use of 
our nation's incredible energy grid infrastructure and to help 
keep costs reasonable and affordable to all Americans. But it 
is also an opportunity for the U.S. to cement itself as a 
leader in transportation innovation. It is an opportunity to 
spur new investment and create jobs. And it is an opportunity 
to make our environment more sustainable through improved air 
quality and through lower greenhouse gas emissions.
    Electric transportation technology and infrastructure are 
going to be one of the keys to making our cities smarter and 
more liveable. In our home state in California, for example, 
the transportation sector contributes 40 percent of the 
greenhouse gas emissions, 80 percent of NOx emissions and 90 
percent of diesel particulate matter pollution. Because of the 
progress we are seeing in clean energy, and specifically in 
California, electrifying the transportation sector offers a 
chance to dramatically reduce each of these numbers. Consider 
in 2016, the electric industry CO2 emissions were 
nearly 25 percent below the 2005 levels and for the first time 
in over 40 years they were lower than emissions from the 
transportation sector.
    EEI member companies including PG&E are already helping to 
turn these opportunities into a reality in an efficient and 
cost effective way that benefits everyone. And let me briefly 
touch on a few examples. One is access to public charging 
infrastructure. A study by EEI and the Institute for Electric 
Innovation projects that by 2025 there will be seven million 
electric vehicles on the road in the United States and they 
will require nearly five million charging stations. More than a 
dozen EEI companies are stepping up and helping with this 
challenge with plans to invest $350 million in customer 
programs and projects.
    PG&E alone, my company, is investing $130 million over the 
next 3 years to put 7,500 chargers at workplaces, at 
multifamily residences, and in disadvantaged communities. This 
will roughly double the number of public charging facilities in 
our service area. And we hope to soon launch an additional $230 
million project of similar investments for medium and heavy 
duty vehicles. We are also growing EV into the grid. One key to 
this is managing the timing of charging. Our companies are 
approaching this in multiple ways including customer education, 
rate design, and smart charging which optimizes charging 
through communication between the grid, the vehicle, and the 
charging equipment.
    For the last several years, PG&E has partnered with BMW to 
successfully pilot wireless smart charging through vehicle 
telematics systems. We also offer special rates to EV owners 
that incentivize them to charge at certain times of the day 
which allows us to take advantage of times when there is excess 
energy available on the grid. For the customer it means they 
are able to charge their vehicles at the equivalent of a $1.20 
per gallon, a price we haven't seen at the pump in 20 years.
    The last area I will touch on is the industry's work to 
accelerate EV adoption by fleet operators including our own 
companies. EEI companies have increased the number of EVs in 
their fleets by 43 percent just since 2015. We are helping 
others make this transition as well. At PG&E, for example, we 
are working with transit agencies in Stockton and San Jose to 
pilot advanced smart charging and energy storage technologies 
to more seamlessly integrate their electric bus fleet charging 
with our grid.
    These few examples only scratch the surface of everything 
we are doing as an industry. The key point I want to leave you 
with is this. Our industry is a critical partner in America's 
transportation future. From a policy standpoint it is vital 
that we continue to look for opportunities to engage the power 
sector and leverage this amazing energy grid that we have in 
this effort. Our companies are unique in our scale, our reach, 
and our expertise and we are committed to partnering and making 
this opportunity in this area a reality for all. Thank you 
again for the opportunity.
    [The prepared statement of Ms. Williams follows:]
    
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    Mr. Shimkus. Thank you very much.
    The chair now recognizes Mr. Frank Macchiarola, Group 
Director, Downstream and Industry Operations for the America 
Petroleum Institute. Welcome.

                 STATEMENT OF FRANK MACCHIAROLA

    Mr. Macchiarola. Good morning. Chairman Shimkus, Ranking 
Member Tonko, and members of the subcommittee. Thank you for 
the opportunity to testify today. My name is Frank Macchiarola 
and I am group director of Downstream and Industry Operations 
at the American Petroleum Institute.
    The subject of this hearing is important as it raises 
policy questions affecting our nation's economic strength, 
energy security, and environmental stewardship while presenting 
core questions about our everyday mobility. The internal 
combustion engine is the backbone of our transportation system 
and instituting significant changes to that system presents 
complex issues that must be approached with substantial 
caution.
    The fuel supply chain is highly integrated with the 
transportation sector therefore we encourage the development 
and evaluation of transportation policy through a holistic 
systems-based approach in which vehicles, fuels, and 
infrastructure are treated as an integrated system. A strong 
oil and gas industry is a vital component of this integrated 
system and it is essential for our standard of living. The oil 
and gas industry supports approximately 10.3 million American 
jobs and nearly 8 percent of the U.S. economy. The industry 
also provides more than 98 percent of the fuels we use to 
conduct commerce, to travel for work and vacation, and to stay 
connected to our family and friends.
    America's energy renaissance has allowed us to produce 
significantly more of the energy we use today and to help the 
United States become a net exporter of gasoline and diesel. At 
the same time, the United States has reduced air pollution by 
73 percent between 1970 and 2016, even as vehicle miles 
traveled nearly tripled and the economy grew during that period 
by 253 percent. EIA estimates that liquid fuels will continue 
to be the primary transportation source through the next two 
decades. The fuels we use must be reliable and affordable and 
fully compatible with engines, motor vehicles, and fuel 
distribution systems and we must enact transportation and 
energy policy based on free market principles providing 
consumer choice and greater certainty for market participants.
    One policy that distorts free market, conflicts with 
integrated approach, and places a burden on the consumer is the 
Renewable Fuel Standard. It is an example of the government 
placing its finger on the scales to benefit one industry over 
another. To be clear, API believes we need all sources of 
commercially viable energy including renewables. However, the 
statutory requirements of the RFS are unworkable and 
unattainable. At the time of the RFS passage in 2007, EIA 
significantly overestimated today's gasoline consumption by 12 
percent, substantially underestimating oil and gas resources by 
70 percent. Furthermore, EIA assumed in 2007 that we would see 
a technological breakthrough in production of advanced and 
cellulosic biofuels. These fuels have failed to be produced in 
meaningful and commercial volumes.
    We need to sunset the outdated RFS and we appreciate the 
leadership of the chairman and members of this subcommittee in 
analyzing potential solutions for comprehensive reform. As we 
look at fuels policies including those addressing electric 
vehicles the RFS should stand as a cautionary tale to 
policymakers. Electric vehicles show some promise in certain 
applications and many forecasters expect market-driven growth 
in the production and use. While API supports market-driven 
activity, we oppose government intervention in the markets to 
pick winners and losers as that creates an unlevel playing 
field.
    In enacting transportation policy we must acknowledge that 
vehicles are staying on the road longer and going further on 
the fuels we use. New transportation policies that incentivize 
shifts in consumer behavior should be considered with caution 
as they could impose undue costs on consumers with diminishing 
environmental benefits. The ultimate trajectory and level of 
market penetration achieved by EVs should not rely on 
government interference but rather the free market. It should 
depend on consumer acceptance and on the relative energy and 
environmental performance of existing conventional automotive 
technologies.
    The oil and gas industry is committed to providing for our 
nation's essential energy needs in the years ahead and we look 
forward to working with the Congress on solutions to support 
the American consumer. I thank the chairman, ranking members, 
and members of the subcommittee for the opportunity to testify 
today and I look forward to your questions. Thank you.
    [The prepared statement of Mr. Macchiarola follows:]
    
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    Mr. Shimkus. Thank you very much.
    The chair now recognizes Dr. David Reichmuth, Senior 
Engineer, Clean Vehicles Program with the Union of Concerned 
Scientists. You are recognized for 5 minutes. Welcome.

                  STATEMENT OF DAVID REICHMUTH

    Mr. Reichmuth. Thank you. Good morning, Chairman Shimkus 
and Ranking Member Tonko and members of the committee. My name 
is Dr. David Reichmuth. I am a senior engineer with the Union 
of Concerned Scientists, a nonprofit advocacy organization 
whose primary mission is to ensure that policy is crafted based 
on the best available science. I would like to thank you for 
the invitation to talk to you today about the benefits of 
electric vehicles, or EVs.
    The promises of EVs are clear. Drivers can save money, 
harmful emissions are reduced, and the use of petroleum can be 
minimized. Reducing emissions means public health benefits, 
economic benefits, and avoiding the worst impacts of climate 
change. Transportation is now the leading source of carbon 
dioxide emissions in the United States. Addressing the 
emissions from this sector is a critical piece in moving toward 
a more sustainable economy and way of life not just for the 
United States but worldwide.
    Now switching fuels from petroleum to electricity can 
provide significant emissions reductions. My colleagues and I 
have compared the climate emissions from driving on electricity 
versus gasoline. To do so, we considered all the global warming 
emissions from driving on electricity versus gasoline and we 
considered all the emissions from fueling power plants, getting 
electricity to an EV and compared that to the emissions created 
extracting crude oil, refining gasoline, distribution to 
filling stations, and combustion in a vehicle's engine.
    Our most recent analysis shows that cars driving on 
electricity in the U.S. have emissions equal to what a gasoline 
car that gets 80 miles per gallon would produce. It is true 
that emissions from EVs vary depending on where in the U.S. 
they are driven, as the emissions from electricity generation 
varies regionally. Overall, 75 percent of the people in the 
U.S. now live where driving on electricity is cleaner than a 50 
mile per gallon gasoline car and these are figures for the 
average EV. More efficient EVs of course are even cleaner. Not 
only are EVs cleaner than gasoline cars, the gap is growing as 
electricity generation shifts away from dirtier fossil fuels to 
sustainable lower emission resources.
    EVs also have air quality benefits when paired with clean 
sources of power. Studies have shown the potential for EVs to 
reduce ground level ozone and particulate matter in both urban 
and rural areas across the country. But EVs are not just 
cleaner than gasoline vehicles, they are cheaper to refuel and 
maintain. In a recent UCS analysis we compared the cost to 
refuel with gasoline with the cost to recharge an EV. Looking 
at the electricity providers in the 50 biggest U.S. cities, 
recharging an EV is cheaper than refueling the average new 
gasoline vehicle in every city. The average saving is almost 
$800 per year on fuel costs.
    In addition to lower fuel costs, EV drivers avoid 
unexpected shocks to their household budget from spiking 
gasoline prices and face significantly lower maintenance costs. 
Battery electric vehicles have no engine so no oil changes, 
spark plugs, or engine air filter to change. Instead, electric 
motors and batteries require little to no attention. This means 
less time and less money spent on routine car maintenance.
    Now EVs are an important tool to improve public health and 
economic vitality, but the EV market, the infrastructure, and 
the technology are still relatively new. It has been less than 
8 years since the start of mainstream EVs in the United States 
and the ability of longer range, lower cost, battery electric 
vehicles really only started last year. So, while there is 
strong growth in EVs both in the number of models available and 
sales volume, it is far too early to end public sector 
investments in EVs and in needed infrastructure. Removing 
support prematurely will delay the adoption of EVs at a time we 
need to be doing exactly the opposite which is accelerating the 
transition to cleaner transportation.
    Other countries around the world are moving to incentivize 
and require electric vehicles and manufacturers will need to 
respond in order to compete. Last year, four of the five top-
selling EV models in the U.S. came off of American assembly 
lines. Making policy choices in the U.S. that inhibit the 
growth of EVs will place domestic car makers at risk of falling 
behind, hurt American drivers, and harm U.S. manufacturing. Now 
EVs are an important solution to improve air quality and reduce 
climate changing emissions. They allow U.S. drivers to use a 
cheaper fuel with lower variability in price. The EV market, it 
is young but it is growing and the investment that U.S. 
Government, the states, automakers, and utilities have made in 
EVs will pay dividends if we continue to have smart EV 
policies.
    I would like to thank you for the invitation to share UCS's 
perspective on electric vehicles and I am happy to speak to 
those issues or anything else which is of interest to the 
committee. Thank you.
    [The prepared statement of Mr. Reichmuth follows:]
    
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    Mr. Shimkus. Thank you very much.
    And finally, last but not least, Mr. Dylan Remley, Senior 
Vice President, Global Partners, on behalf of the National 
Association of Convenience Stores and Society of Independent 
Gasoline Marketers of America. Sir, you are recognized for 5 
minutes. Welcome.

                   STATEMENT OF DYLAN REMLEY

    Mr. Remley. Chairman Shimkus, Ranking Member Tonko, members 
of the subcommittee, thank you for the opportunity to testify 
today on the future policy implications of electric and 
conventional vehicles. My name is Dylan Remley. I am Senior 
Vice President of Terminal Operations for Global Partners. 
Global has one of the largest terminal networks in the 
Northeast and we are also one of the largest independent 
owners, suppliers, and operators of gasoline stations in the 
Northeast with approximately 1,450 locations, 260 of which we 
directly operate. I am testifying today on behalf of the 
National Association of Convenience Stores and the Society of 
Independent Gasoline Marketers of America.
    Members of NACS and SIGMA, collectively, account for 
approximately 80 percent of retail motor fuel sales in the 
United States. Fuel retailers are consumer-facing entities that 
must adapt to changing consumer demands and to do so we must 
change the products and services we offer to the general 
public. We have chosen our retail locations with care. We 
constantly strive to provide the best possible refueling 
services to consumers. For example, Global itself has recently 
partnered with Electrify America to install EV charging 
stations in some of our stores and we are also exploring a 
number of other options with EV providers to meet the ever-
changing needs of our customer base.
    However, as more electric vehicles continue to share the 
road with conventional vehicles in the years ahead, we urge 
policymakers to consider several factors including the 
environmental and energy independence implications of this 
shift, the impact on marketplace competition, and then the 
impact on the Nation's infrastructure. Lawmakers must examine 
the well-to-wheels cost and impact of EVs from power plant 
energy distribution to battery disposal. How will batteries be 
ultimately recycled and then disposed of if it cannot be 
recycled? Moving forward now and figuring out not only this 
issue but a host of others at a later date does not work.
    It is also important for lawmakers to consider energy 
security and independence questions. Our nation has made 
significant strides to achieve energy independence and 
security. We should question the implications of a transition 
to electricity-powered vehicles that will come at a significant 
cost in the form of new infrastructure and will rely on the 
importation of certain raw materials from countries that may 
not be considered politically or economically stable. However, 
today, what we would most like to emphasize is that 
policymakers must consider the current skewed incentives that 
exist for EVs that may lead to an anticompetitive refueling 
marketplace.
    Many states effectively grant utility companies a monopoly 
over the provision of electricity in a particular marketplace 
and utility companies are guaranteed a rate of return from 
their ratepayers. Recently, utility companies have sought 
approval to enter the EV recharging business and treat their 
capital investments in that business as part of the utility 
rate base that all of their customers must pay. The private 
sector will have significant difficulty competing with zero 
market entry costs. It is inappropriate for utility companies 
and states to be regressively funding electric recharging 
infrastructure on the backs of ratepayers, the vast majority of 
whom do not even drive EVs.
    I want to be very clear. Fuel retailers do not have a 
problem with a public utility entry in the electric fuel 
recharging business provided it is competing for that business 
on equal footing with the private sector. A public utility 
company should not be able to invest in electric or alternative 
fuel recharging infrastructure by using ratepayer funds which 
the private sector simply cannot compete with.
    Infrastructure concerns including updating the power grid 
and the cost of maintaining the Nation's roads and bridges must 
also be evaluated. Unlike conventional vehicles which support 
infrastructure investments because their owners pay the gas 
tax, current EV owners use the country's roads essentially for 
free. Lawmakers should ensure the EV recharging and 
infrastructure investment is done through the private sector on 
a level playing field so that tax and other incentives are not 
provided to certain stakeholders to the omission of others.
    Finally, given the prime location of retail fueling stores, 
the highly competitive nature of our industry, and a wealth of 
experience in refueling, we believe that the fuel retailing 
industry is well-positioned to meet consumer needs as EVs 
continue to enter the marketplace. We encourage Congress and 
the states to work with industry and other stakeholders to find 
ways to deploy electric charging infrastructure via the 
existing privately developed motor fuel marketplace. Thank you 
for the opportunity to testify and I am happy to answer any 
questions.
    [The prepared statement of Mr. Remley follows:]
    
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    Mr. Shimkus. Thank you very much. What a great panel. I 
appreciate all your time. It shows you the challenges that we 
have in front of us.
    So with that I will recognize myself 5 minutes to start the 
round of questioning. And this is really for anyone. You all 
have been following what we have been doing. Our last hearing 
on April 13th talked about the opportunity of high octane fuels 
and vehicles optimized to use them. Do you see that as a 
benefit to meeting CAFE and environmental emission issues if we 
moved to a high octane standard? And this is open to any of the 
panelists who may want to answer that question.
    Bob, first?
    Mr. Dinneen. Sure. Absolutely, Congressman, as I mentioned 
in my testimony, we believe that high octane fuels with 
optimized engines represent a tremendous opportunity to 
generate efficiency gains and carbon reductions. It is the way 
of the future and can be one of those future technologies that 
is providing consumer choice and savings at the pump.
    Mr. Shimkus. Mitch?
    Mr. Bainwol. We would agree that octane offers an 
opportunity for fuel efficiency gains and we are agnostic about 
the source of the octane, but ethanol is a low-cost option.
    Mr. Shimkus. Well, Mr. Bainwol, so in our debate we have 
talked to, in essence, our big three, but obviously you 
represent a broader spectrum of manufacturers who haven't been 
in discussions with us yet. Do you think they would eventually 
see this as an opportunity for meeting the CAFE and some of the 
environmental issues?
    Mr. Bainwol. So I think most folks agree that there is a 
value to octane and its conversation, I think, is taking place 
and will accelerate. Just last week a number of our members met 
with Bob and others from the ethanol community, so I think it 
is timely, ripe, and we are happy to engage.
    Mr. Shimkus. Great.
    Mr. Macchiarola?
    Mr. Macchiarola. Sure. Mr. Chairman, we believe the idea of 
a 95 RON technology-neutral national performance standard is an 
intriguing one. Certainly it would have to be coupled in a 
conversation about broader RFS reform that we believe must 
include a sunset of the program, but again we also think on the 
question of 95 RON there are outstanding questions, questions 
about timing, the phase-in period of which it would be phased 
in, questions about potential costs at retail, potential 
mislabeling issues, are all questions that need to be analyzed 
and assessed. But again we appreciate your efforts on 
comprehensive RFS reform.
    Mr. Shimkus. Let me go to Mr. Remley.
    Mr. Remley. Chairman, if I can just comment briefly, I 
think we would agree with a lot of the comments that the rest 
of the witnesses had. It is a promising opportunity. I think 
the concern just raised by Mr. Macchiarola would also be echoed 
at the retail level which is labeling. There are still 
questions from OEMs with regards to higher ethanol blends, but 
the concept of the 95 RON and higher octane is certainly a 
promising development.
    Mr. Shimkus. Great, thanks.
    I want to move to my next question so I want to go to AAA, 
Ms. McKernan. The price of EVs are still high and the long 
charging stations makes it difficult to take long trips. I am 
from rural Illinois and I represent 33 counties. Over the last 
week I spent almost 6 hours on the road every day I was home. 
So can EVs ever work for lower income households especially 
ones that can only afford a single car?
    Ms. McKernan. Well, definitely range anxiety is beginning 
to ease and the number of charging stations has increased in 
the United States, reached a level of 16,000 in 2017. AAA's 
main concern is giving consumers a choice. And so we are not 
advocating one way or another that people should drive EVs or 
not, we want to provide the most information that we can for 
consumers so they have the choice.
    Mr. Shimkus. So let me cut you off, I am getting short on 
time. But I wanted to ask because you mentioned roads and 
bridges, so how do we help--and this is not a Ways and Means 
Committee, in fact, my roommate Mr. Brady would be mad if I 
asked this question. But how do we then incorporate the 
electric vehicles into the funding of our roads and bridges 
systems? What is the secret sauce that allows us to help 
maintain those in a Highway Trust Fund?
    Ms. McKernan. I don't have that specific information. This 
particular study didn't cover anything like that. But I would 
be happy to have AAA's staff follow up with a response.
    Mr. Shimkus. Well, I think that is going to be, it is an 
important debate if you talk to folks in the Transportation 
Committee and also the Ways and Means, is why haven't we done 
anything on roads and bridges is this Highway Trust Fund fight. 
So this is going to be, whether it is now or the future it is 
going to be part of the debate.
    Let me go back to Bob for my final question. In your 
testimony you suggest that environmental benefits of EVs are 
overstated while the environmental benefits of biofuels are not 
fully accounted for. How would you suggest fixing that?
    Mr. Dinneen. Well, I think they need to look at a full 
lifecycle analysis for all fuels and technologies. For ethanol, 
Congressman, they count the angels on the head of a pin. They 
look at the energy it takes to produce the fuel. They take the 
energy that is used in the production of the fertilizer on the 
farm and the energy it takes to produce the John Deere hat the 
farmer wears. Heck, they even count emissions from overseas 
from indirect land use. And for electricity they only are 
looking at the carbon not the tailpipe and the source of the 
electricity is not considered and that just gives a disparate 
view.
    Mr. Shimkus. Thank you. My time has expired. I am going to 
move to the ranking member of the subcommittee, Mr. Tonko, for 
5 minutes.
    Mr. Tonko. Thank you, Mr. Chair.
    Ms. McKernan, earlier I mentioned some of the trends that 
AAA has identified on potentially changing consumer attitudes 
on EVs. Do you have any thoughts on whether there might be a 
growing consumer acceptance of EVs?
    Ms. McKernan. Yes, there definitely is a growing consumer 
acceptance. The more consumers can learn about the technology, 
what the capabilities are, and seeing whether or not it can fit 
into their lifestyle, I think, is what is helping to change 
their attitudes.
    Mr. Tonko. Thank you.
    And Dr. Reichmuth and Ms. Cullen, some have suggested that 
low penetration of EVs is because consumers do not want them. 
Is that a fair assessment?
    Mr. Reichmuth. If I may, that is not a fair assessment 
because the consumers in the marketplace for a new car are not 
seeing the same variety of models that they are seeing in 
gasoline vehicles. So there are cars that are not available in 
every state, the Fiat 500E is only available in two states, for 
example. There is no plug-in pickup truck yet so if you are in 
the market for a pickup. There are also brands that don't offer 
an EV, so you can't get a Jeep or a Lexus plug-in yet. So, when 
you just look at the penetration rate, the number, the amount 
of sales, it doesn't reflect necessarily the consumer desire to 
buy an EV if they can't get that EV on their dealers' lots.
    Ms. Cullen. I would also point out that you are talking 
about penetration in an extremely large market so while the 
percentage might be small in penetration the growth of the 
market has been substantial. As I noted, we went from two 
vehicles on the market in late 2010 to almost 50 varieties at 
different price points today and those offerings are only 
increasing. Every major auto manufacturer has announced plans 
to diversify their fleets, their price points, the sizes, to 
offer the additional segments and performance profiles that 
consumers are looking for.
    So I think it is also important to note again the market 
has grown every year since introduction and that 2017 
represents a 71 percent increase in sales over 2015. So this 
market is growing, but we are pretty new and we are a small 
part of the enormous car park.
    Mr. Tonko. And again, Ms. Cullen, one of the biggest 
barriers to greater EV adoption has been a lack of charging 
infrastructure. You cite a Navigant study that estimates sales 
of fast chargers are expected to increase from 20,000 to over 
70,000 annually within a decade. What role will this deployment 
of fast charging infrastructure have in further EV adoption?
    Ms. Cullen. The expansion of DC fast charging will 
absolutely facilitate expanded use of electric transportation 
and it might be worth just taking a second for those people 
that don't live and breathe this that so there are levels of 
charging. Level 1 is the outlet in your home. Level 2 at 240 
volts is what your dryer or your refrigerator would run after 
and that reduces the charging time of an EV by half. A DC fast 
charger reduces that charging time again to a point that 
enables essentially long distance traveling in a pure battery 
electric vehicle.
    I would also add that the question--you can also build 
range confidence by building in extra battery capacity in the 
vehicle. And that is what is happening. We are seeing longer 
ranges in battery vehicles and the fact that there are plug-in 
hybrids where you have the addition of an internal combustion 
engine that can service all your longer distance needs and 
perhaps do all of your daily commuting on electricity.
    Mr. Tonko. Thank you.
    And Dr. Reichmuth, a majority of EV charging occurs at 
home. Unfortunately, this is not an option for everyone 
especially in cities which may have high potential for EV 
adoption due to shorter commuting but also have many people 
living in apartment buildings, multifamily houses, or in 
neighborhoods without dedicated parking spots. So do you have 
any suggestions of how to enable this population to access EV 
charging infrastructure?
    Mr. Reichmuth. Yes. That is an important consideration. So 
there is a number of things that are going on. One is the 
increase in putting charging into multifamily dwellings, so 
apartment buildings, condominiums, and a number of the 
utilities are working hard at that right now. We can also take 
a look at building codes. Putting at least conduit and the 
space for EV charging in parking garages and new facilities, 
you don't have to put the wiring, you don't have to put in the 
charging equipment itself. You can just put the conduit so you 
don't have to rip up concrete or rip up a parking lot to put in 
charging later.
    And then the last thing is DC fast charging in urban 
environments not just for people that don't have a place to 
park at home and to charge at home, but also to enable taxi, 
ride sharing, and other uses of electric vehicles in the urban 
environment, so having that fast charging within the urban 
environment.
    Mr. Tonko. Thank you very much. I yield back.
    Mr. Shimkus. The gentleman yields back his time. The chair 
now recognizes the gentleman from Ohio, Mr. Johnson, for 5 
minutes.
    Mr. Johnson. Thank you, Mr. Chairman, and thanks to all of 
our panel members for being here this morning. I appreciate 
this discussion.
    Ms. Williams, the electricity grid is becoming increasingly 
complex with electric vehicles being just a part of that 
increasing complexity. This presents us both with opportunities 
and challenges for the grid. Along those lines, can you 
identify any potential cyber threats associated with increased 
usage of EVs and what is the industry doing to tackle these 
challenges?
    Ms. Williams. Thank you very much for that question. So as 
you know, the electric utility industry, the energy companies 
of America, we take cyber threats extremely seriously. We work 
very closely with the government looking at standards, looking 
at our controls, looking at specific things we need to do to 
make our grid the safest and the most cyber secure that it can 
be. Of course when you look at electrification overall, more 
points, electrification whether they be electric vehicles or 
other things do in fact present additional opportunities for a 
hacker to get in and that is why we have got to be so vigilant, 
again working closely with government to make sure that our 
system is up to code, that we have good monitoring in place, 
early detection, and fast response.
    We view charging networks or chargers very much like an 
appliance and as our homes become smarter, as really the grid 
becomes smarter we have to increase the level of vigilance and 
make sure that it is up to code in everything that we have in 
place. There are NERC standards, there are any number of 
standards that we comply with to make sure that they are cyber 
secure.
    Mr. Johnson. Sure. Well, my background is information 
technology and I have said it many, many times, cybersecurity 
is not a goal that has a finish line because as soon as you 
solve one problem there is a dozen more right on the backside 
of it. It is just something we are going to have to remain 
vigilant on and I appreciate that.
    Mr. Macchiarola, the oil and gas industry has undergone 
significant changes due to breakthroughs and technological 
advancements. Eastern and Southeastern Ohio, for example, has 
benefited greatly from the Utica and Marcellus shale gas plays 
and I think the ability to access this cheap oil and gas took 
many people by surprise. And I think this example plainly shows 
we can't always predict future technological breakthroughs nor 
the impact that these breakthroughs will have on the different 
sectors of our economy such as the automobile industry.
    So as Congress looks at current and future transportation 
policies, how can we ensure that we are not jeopardizing the 
private sector's ability to innovate and bring about new 
technological advancements?
    Mr. Macchiarola. That is a great question, Congressman, and 
you know firsthand the experience of the shale gas revolution 
and in Ohio and your leadership on LNG exports helped bring 
that to markets around the world. From our perspective, I think 
the point you make is a strong one about the fact that tipping 
the scale, of keeping your finger on the scale for government 
through mandates or through incentives can have a real 
dampening effect on bringing affordable energy to the consumer, 
strengthening our energy security.
    The example that I highlighted in my testimony, the 
Renewable Fuel Standard, is a perfect case of that. The 
estimates that we had both on the demand side and on the supply 
side totally missed the mark over the past decade and the 
result is we have a mandate that can't be met and needs to be 
reformed.
    Mr. Johnson. OK, thank you.
    Ms. Williams, back to you, I mentioned that I represent 
rural Appalachia. It is not uncommon for my constituents to 
have to travel 35, 40 miles up hills, down hills, around curves 
to go to work, to go check on Mom and Dad, to go to the grocery 
store or the hospital. The terrain is hilly and dependability 
is a must in automobiles, with light trucks and SUVs and 
pickups largely making up the vehicles of choice. While I see 
EVs making inroads in the cities, they face a different set of 
challenges in my neck of the woods. Do you believe that EVs 
will become viable in rural parts of the country that have 
weather and terrain and distance challenges like that?
    Ms. Williams. I do believe they will become viable in all 
parts of our society. Within our own service area we have hills 
and lots of varied terrain. We have a lot of agricultural parts 
of our service area in our Central Valley and our North Valley. 
Some of these areas also end up being some of our most 
disadvantaged.
    So one of the things that we are doing as we are doing 
these pilots to put in more charging networks is going to learn 
a great deal about as you put these charging stations in 
different parts of our service area, some of which are 
disadvantaged communities, some of which are rural, how does it 
impact the adoption of electric vehicles, does it make a 
difference? We think it will, but it is going to be an 
interesting pilot for us to learn from so that we can take 
those learnings and then deploy them. As we have heard from 
some of the other folks this morning that are testifying, 
battery life is increasing and technology is really evolving 
and so what we have today may not be exactly what we have 10 or 
20 years from now, so I do believe that it will be viable 
across the country.
    Mr. Johnson. OK. Well, thank you, ma'am. And Mr. Chairman, 
I yield back.
    Mr. Shimkus. The gentleman yields back his time. The chair 
now recognizes the gentleman--we have a lot of Californians on 
this subcommittee--so he recognizes the gentleman from 
California, Mr. McNerney, for 5 minutes.
    Mr. McNerney. I thank the chairman and I thank the 
panelists, a great set of viewpoints this morning.
    Ms. Williams, I appreciate you giving us a shout-out to 
Stockton and the work with the RTD out there to electric our 
bus systems. What sort of integration challenges do the 
electric utilities face and are there grid related benefits to 
EV penetration?
    Ms. Williams. I do believe there are grid-related benefits. 
One of the things that we find in California as we know, 
Congressman, is we have plentiful solar renewable resource 
available to us, often more than we need in the middle of the 
day. And I believe that electric vehicles provide us an 
opportunity through smart charging, through incentives to 
really, our customers to charge at the right time to take 
advantage of that plentiful resource that is there to really 
better utilize this incredible energy grid that we have. At the 
same time we are seeing second use batteries being grouped and 
deployed to become almost like a battery to grid resource. So 
in the middle of the night when we don't have the sunshine, the 
battery, the second life batteries provide us needed resources 
to really smooth out the resource requirements for our system.
    Mr. McNerney. So when you refer to wireless smart charging 
you are referring to the communication being wireless not the 
charging?
    Ms. Williams. Correct, the communication, the telematics.
    Mr. McNerney. Right. Do you have any rebuttal to Mr. 
Remley's comments that the utilities are being guaranteed a 
rate of return and building EV infrastructure on the backs of 
ratepayers?
    Ms. Williams. I do. Energy companies like PG&E Corporation 
or PG&E are not guaranteed a rate of return. That is a rate of 
return that is set and if you operate your system efficiently 
and effectively and deploy your capital and run your business 
efficiently you could achieve that but you don't often achieve 
that necessarily. As far as the whole approach of the utilities 
somehow expanding their monopoly, we believe in competition and 
EEI nor PG&E believes that there is one point of view in terms 
of what that business model looks like. We look forward to 
partnering with third parties in terms of the actual ownership 
of the charging network. We view ourselves as an enabler. We 
view ourselves as, because of our scale, because of our capital 
as spurring this important resource into happening, but we 
certainly don't believe that we are the only game in town. We 
want to help electric vehicles actually become more of a 
reality. Again we see ourselves as an enabler, not as a 
monopolistic owner of those charging networks.
    Mr. McNerney. Thank you.
    Mr. Reichmuth, how do EVs lifecycle global warming 
emissions compare to that of gasoline vehicles?
    Mr. Reichmuth. That is an important question. So with the 
research that we have done at UCS we found that, in general, 
driving on electricity is much cleaner than driving on gasoline 
from a global warming perspective. In our analysis we did an 
apples-to-apples comparison, looked at all the emissions from 
generating electricity and bringing it to the EV and compared 
that to getting crude oil out of the ground, refining it into 
gasoline, distributing it to service stations, and then of 
course burning it in the car. If you look at cars today on the 
road, the EVs on the road, they average emissions equal to an 
80 mile per gallon gasoline car and that is higher in places 
with cleaner electricity, so over a hundred miles a gallon 
equivalent in California.
    Mr. McNerney. Thank you.
    Mr. Bainwol, have the CAFE standards introduced an 
explosion of innovation in auto engineering? That is kind of a 
leading question, but go ahead and answer it.
    Mr. Bainwol. Yes, there has been massive investment in 
innovation both on a powertrain side and elsewhere, and 
certainly standards certainly bias some of those decisions.
    Mr. McNerney. Will the elimination as proposed by Mr. 
Pruitt impact that drive to innovation?
    Mr. Bainwol. There has not been a final NPRM so we don't 
know whether they are going to be eliminated or not. We are 
hopeful that this slope continues to rise. We are in favor of 
year over year fuel efficiency.
    Mr. McNerney. Thank you.
    Ms. Cullen, do you know if the electric vehicle industry 
working to create appliances--let me read this as it is 
written. I am trying to innovate here. Do you know if the 
electric vehicle industry working to create small motors for 
industries such as agriculture is the industry working to 
create applications for agriculture?
    Ms. Cullen. It absolutely is. There is enormous growth in 
mobile equipment in the electric drive field. We are seeing 
them in tractors, in forklifts, and you are seeing applications 
at ports and other, and airports that the flexibility of 
electric drive is that it is very scalable and so that it can 
be used in small and light applications as well as larger and 
heavy duty ones because we are also seeing an enormous growth 
in the medium and heavy duty and the transit bus segment.
    Mr. Shimkus. The gentleman's time is expiring.
    Mr. McNerney. Well, I will yield back then.
    Mr. Shimkus. The gentleman yields back his time. The chair 
now recognizes the Chairman Emeritus of the Energy and Commerce 
Committee, Joe Barton, for 5 minutes.
    Mr. Barton. Thank you. I am happy to go, but Mr. Duncan was 
here before me if you----
    Mr. Shimkus. I would like for you to allow Mr. Duncan to go 
first.
    Mr. Barton. I think Mr. Duncan is fully entitled. He showed 
up at his first baseball practice today and that gives him real 
priority.
    Mr. Shimkus. The chair recognizes the gentleman from South 
Carolina, Mr. Duncan, for 5 minutes.
    Mr. Duncan. Thank you.
    And Mr. Bainwol, in your testimony you alluded to the 
obvious that when gas prices fall the desire to pay more for a 
vehicle with higher fuel economy diminishes. The statements 
reflect over the ebbs and flows of the demand in the market. 
Despite all the incentives to purchase EVs, they still only 
represent only 1 percent of all vehicles purchased last year. 
Despite the reality of the market, it is clear that government 
is trying to push consumers toward purchasing electric 
vehicles.
    Now I believe that the market determines what people buy 
and people buy what suits their needs whether it is safety as a 
concern, whether it is size, horsepower, or whatever, and many 
people like to drive SUVs. For example, in my district light 
trucks, SUVs, pickups, and vans accounted for 63.92 percent of 
vehicle sales. Electric vehicles only accounted for 0.05 of the 
sales in 2016. Now my office did the math and that equates to 
literally 13 electric vehicles in my district, 13--770,000 
people and 11 counties in South Carolina, in 2016 that equated 
to 13 vehicles.
    It is clear my constituents don't really gravitate toward 
these vehicles. I am not going to say they don't like them. 
They don't gravitate toward them for a lot of reasons, probably 
price point being a big part of that, probably the need to 
carry things in a pickup or SUV. So the way I see it, when 
consumers are determining what vehicle to purchase they look to 
see if it fits their needs. I do recognize that the price of 
EVs are decreasing and I understand the Tesla Model 3 costs 
about $35,000. Let me ask you this. If electric vehicles can be 
brought down to a price comparable to that of an average 
conventional new car, should the government be providing 
massive tax credit to purchase them?
    Mr. Bainwol?
    Mr. Bainwol. So when we get to a point where the costs have 
equalized I think that is a good policy question. We face a 
reality today where globally and in this country we have 
requirements to meet both CAFE standards as well as the ZEV 
mandate in California and a bunch of other states that 
represent probably a third of the country. So we have a 
compliance reality where electrification really does help. And 
so the question here is when this inflection point occurs and 
that is a function of range and battery cost, and I think 
Bloomberg has estimated that by 2025 the price delta will 
equalize and at that point certainly with additional range then 
you can see the calculus for a consumer evolving.
    Mr. Duncan. I agree. So let me ask you this. If we get rid 
of the tax credits and incentives do you truly believe consumer 
demand is there for electric vehicles?
    Mr. Bainwol. I think consumer demand is coming and we need 
for it to come. We do have a compliance reality that is just a 
matter of law and so we have got to comply and electrification 
is definitely a piece of that compliance. And as the battery 
costs come down and range improves then that becomes a viable 
compliance approach.
    Mr. Duncan. I actually like electric vehicles. I like the 
thought process of it. I understand horsepower issues. An 
electric motor pushes an aircraft carrier. So I also understand 
the simplicity. If you blow an electric motor you unplug it, 
put another one in, plug it back in, and the car goes. It is 
not like an internal combustion engine. I think the car 
manufacturers are recognizing the future as well. I think we 
are going to see that. The problem I have is when government 
picks winners and losers, when government is forcing consumers 
into a certain area like this because of some political beliefs 
and philosophical beliefs.
    So, Mr. Chairman, I don't have any other questions, but 
thanks for holding the hearing. It has been informative. I 
yield back.
    Mr. Shimkus. The gentleman yields back his time. The chair 
recognizes the gentlelady from Michigan, Mrs. Dingell, for 5 
minutes.
    Mrs. Dingell. Thank you, Mr. Chairman. I thank you again to 
all of the witnesses for being here, a subject I deeply care 
about.
    I am going to do my first questions to Mr. Bainwol and to 
Ms. Cullen. Can you elaborate on how the global shift to the 
electrification of mobility is affecting the U.S. manufacturing 
base and what kind of opportunity does this represent for the 
auto industry and its workers?
    Mr. Bainwol. I would just note that first slide I showed 
reflected a growth in unit sales from roughly 50 million units 
in 1996 to something approaching 100 million units. And as 
other countries right or wrongly determine that electrification 
is going to be a big piece of that for us to compete we have 
got to have an ability to innovate and to respond to that 
growing market.
    Mrs. Dingell. Ms. Cullen, any comment?
    Ms. Cullen. I agree completely with what Mitch just said 
there and I think as a matter of manufacturing and employment 
this global market is an enormous generational opportunity. The 
last time DOE looked at employment numbers they were looking at 
in 2015, just looking at the electric drive manufacturing 
segment they counted some 215,000 jobs. So that is fully 3 
years ago. In that time that segment has grown as has the 
entire ecosystem associated with vehicles and infrastructure. 
So it is an enormous opportunity for our employment base and 
for our global competitiveness.
    Mrs. Dingell. As mentioned in your testimony, and to this 
committee and the House, the House unanimously passed 
legislation that we worked, I worked on, to facilitate the 
testing and deployment of autonomous vehicles. Can you both 
talk a bit more about the role EV technology plays in 
supporting AV's future?
    Ms. Cullen. First of all, thank you for your leadership on 
that issue. We are, I think everyone in the industry and 
everyone who actually uses roads is interested in the future of 
automation and how that changes transportation. I think what 
everyone who is looking at automation sees is that 
electrification is an optimal partner, because as a congressman 
pointed it is a simpler technology so there are fewer pieces to 
electrify. It is also more suited to the connectivity that is 
essential for automated transportation.
    Again and finally, I think because of its drive cycles EVs 
are perfect partners for what is seen as the first market for 
automated vehicles which is urban shared mobility, sort of your 
Lyft vehicle, and that those short drive cycles are perfect for 
an urban EV.
    Mrs. Dingell. Thank you. I am going to be running out of 
time and I have a lot of questions. So let me ask you, switch 
to another subject, I want to talk about the important role 
that Congress can play to incentivize EV adoption and 
deployment. The EV tax credit has played an important role in 
this, but should we be looking at tweaking it if necessary to 
make it even more effective? We know that today's electric 
vehicles cost more than the conventional gasoline powered cars. 
Do you believe that the EV tax incentive has helped consumers 
afford an EV that they otherwise would not?
    Ms. Cullen. Absolutely. The credit has been effective and 
it is working as designed by Congress. It is making a new 
technology, which has the standard price premiums associated 
with new technologies, more affordable to consumers which in 
turn is helping the industry build to scale and that is the 
global opportunity we are trying to capture.
    Mrs. Dingell. So I hear from manufacturers that the tax 
credit has been critical to EV sales. Do you think that when 
some manufacturers hit the cap and they may need to reduce the 
price and potentially lose even more money could this 
disincentivize EV protection and could this cap potentially 
take us backwards? In your opinion, will auto companies reach 
production scale at 200,000 units or do we need a larger more 
robust EV market so that all manufacturers can take advantage 
of this scale?
    Ms. Cullen. I think it is important that Congress take a 
look and update that credit to reflect where the scale of the 
market is now. I think there is an important role for it to 
play going forward and having as many diverse entrants into the 
industry is critical.
    Mrs. Dingell. We know that about ten states currently offer 
EV incentives. Why isn't this doing enough? Why is it so 
important for the Federal Government to have a role here to the 
EV tax credit and can you even answer why when states who have 
these EV mandates said that they were going to put these 
vehicles into their fleets they haven't?
    Ms. Cullen. I cannot answer that question. I would leave 
that to the states. But the federal policy does speak to the 
importance of certainty and that is what consumers want, what 
manufacturers want, and what industry wants is they need some 
certainty to make their decisions and make their investments.
    Mrs. Dingell. I am out of time.
    Mr. Shimkus. The gentlelady's time has expired. The chair 
now recognizes the gentleman from Texas, Mr. Barton, for 5 
minutes.
    Mr. Barton. Well, thank you, Mr. Chairman. And since I 
allowed Mr. Duncan to go first since he showed up at baseball 
practice this morning, I should commend you, the audience that 
know this, but in addition to being such a great subcommittee 
chairman you are one of the all-time all-stars of the 
Republican baseball team and just announced your retirement. 
Your son is graduating, I think, the day of the game or the 
next day.
    Mr. Shimkus is the only, I think this is true, the only 
current member of either team that has hit an over-the-fence 
home run, blue socks, he was my MVP pitcher a number of years, 
pitched the year after he had a heart attack. And you will be 
missed. In fact you were missed at the practice today, you not 
being there for the first time in 20 years. So in addition to 
being a great subcommittee chairman, you are just one of the 
best athletes to ever play in the baseball game and we will 
miss you.
    Mr. Shimkus. How very kind of you. I was able to work on my 
nuclear waste bill though this morning so.
    Mr. Barton. I don't know if that is a good tradeoff, quite 
frankly. Anyway, we aren't here, we are basically here to talk 
about electric vehicles.
    I have got, really, just two basic questions and I don't 
know who to ask them to, there are so many people at the 
witness table. My first question is what is the cost of a home 
electric vehicle charge station if there is such a thing in 
existence? Who can answer that?
    Mr. Remley?
    Mr. Remley. The costs vary widely. If you are talking about 
a Level 1 charger it can be a few hundred to a few thousand 
dollars and it ranges----
    Mr. Barton. I am talking about at somebody's house.
    Mr. Remley. That is correct. It is going to be a few 
hundred to a few thousand dollars depending on the vehicle and 
a host of other factors. And a DCFC fast charger can be 
hundreds of thousands of dollars.
    Mr. Barton. Hundreds of thousands.
    Ms. Cullen. Congressman, may I?
    Mr. Barton. Sure.
    Ms. Cullen. Actually a Level 1 charger is the outlet in 
your house. You don't pay extra for that. You can just plug in 
your car. It will take longer to charge but you can do that for 
free. A Level 2 charger to install it with any sort of smart 
technology so that you could set a timer, you could spend a few 
hundred dollars to a couple thousand dollars depending on how 
smart you want it to be.
    Mr. Barton. But they are available?
    Ms. Cullen. They are.
    Mr. Barton. OK. Now what about a commercial charger at a, I 
call it a gasoline station. I guess you would call it an 
electric station. What would a commercial charger that you 
could just drive up and instead of fill up your tank charge 
your battery in some reasonable amount of time?
    Ms. Cullen. Right. So at the next level, in commercial 
facilities whether they are at coffee shops or at gas stations 
or anyplace where there is an electricity line you can install 
a commercial charging spot. And most people would use either a 
Level 2 if it is a place where people are going to be sitting 
for awhile like an airport where you are going to leave your 
car while you are on a trip. You could plug it in and charge it 
at a slower rate.
    If you are, say, at Starbucks and you just have 10 minutes 
they would be interested in installing a DC fast charge, which 
is 480 volts, so that folks who went in to get a cup of coffee 
could get several or ten or twelve miles of charge in 10 
minutes. And that costs, depending on how, the conduit and how 
complicated it is to lay down the line, $50,000 would be----
    Mr. Barton. But those both in your home and commercially 
there is equipment available today?
    Ms. Cullen. Yes, in all price points and capacities.
    Mr. Barton. OK.
    Mr. Remley. Congressman, if I may, just our personal 
experience we are installing them at our convenience stores. A 
brand new convenience store having separate chargers requires a 
separate, essentially, sub-mini station.
    Mr. Barton. It is a what?
    Mr. Remley. It is a separate sub-mini station.
    Mr. Barton. Sub-mini station.
    Mr. Remley. Yes. It requires 500 additional square feet and 
the total cost of bringing that in is several hundred thousand 
dollars.
    Mr. Barton. All right, but not going to be a lot of several 
hundred thousand dollar stations installed. This next question 
is much trickier. We fund a big chunk of new highway 
construction and maintenance through the Highway Trust Fund 
which is funded by a cents per gallon federal highway gasoline 
tax and in most states have the same thing, they tack on a 
state tax. Well, if your electric vehicle, you can't charge 
them per gallon so how do you, as we get more electric vehicles 
how do we set up a system where they pay into the Highway Trust 
Fund? Who wants to tackle that one?
    Ms. Cullen. I will have a go at it.
    Mr. Barton. OK. You are the lady with the answer today.
    Ms. Cullen. Well, first, pure battery electric vehicles 
don't use gasoline but plug-in highway vehicles do and they do 
pay a gas tax.
    Mr. Barton. Well, focus on all-electric.
    Ms. Cullen. So for that segment of the fleet we absolutely 
want to be part of a comprehensive solution that funds the 
infrastructure, the conventional and the infrastructure of the 
future that we need, and there are states looking at innovative 
ways to do that. And we certainly recognize that the gas tax 
system as it is not broken. We didn't break it, but----
    Mr. Barton. And nobody has claimed you broke it.
    Ms. Cullen [continuing]. The fact is it doesn't serve the 
current transportation sector. So I think we need to look at 
how everyone contributes and we want to be part of it.
    Mr. Barton. Oh, you don't have an answer. Does everybody 
who supports electric vehicles at the witness table agree that 
electric vehicles in some way should pay proportionately into 
the Highway Trust Fund? Is there anybody that disagrees with 
that? I think if----
    Mr. Bainwol. I would add just not a discordant note, but a 
point of complication and that is we have aggressive fuel 
standards in force that we have to comply with. I am not making 
a value judgment, I am describing what is. And in order to 
comply we need some level of electrification over the years to 
come as well as with the California ZEV program, and to the 
extent we put impediments in the way of adoption of 
electrification that makes that challenge a little bit deeper. 
So the point is that these policies can be contradictory and it 
is a tough thing to manage and our particular challenge is we 
need adoption of electrification in order to comply and that is 
just a fact of life and anything that makes that more 
challenging is a bit of a problem.
    Mr. Shimkus. The gentleman's time, he was so nice to me so 
I gave him a little bit of extra time. So the gentleman's time 
has expired. The chair now recognizes the gentlelady from 
California, Ms. Matsui, for 5 minutes.
    Ms. Matsui. Thank you, Mr. Chairman. First of all, I would 
like to start by thanking Geisha Williams from PG&E. PG&E 
services part of my district in California and it is always 
nice to have a fellow Californian here, although we do have 
plenty, I guess, here. We have seen the way that our changing 
climate has intensified natural disasters across the country 
and recent scientific studies have even been able to attribute 
the extent to which climate change has affected specific 
extreme events.
    Ms. Williams, I know that your utility has felt the impacts 
of climate change on your operation. Those impacts include more 
intense wildfires and they are difficult for both rate payers 
and utilities and I appreciate that the State of California is 
taking a look at these issues. I am also pleased that you are 
taking tangible climate action that reduces emissions from the 
transportation sector to the benefit of both the utility and 
the environment. Tell me more about PG&E's work to facilitate 
EV deployment, because in our state it really is somewhat of a 
mandate.
    Ms. Williams. Thank you for that question, Congresswoman. 
It is great to see you again. So we absolutely are facing 
climate change issues in the State of California and we 
certainly believe that the horrible, devastating wildfires that 
we had last year are very greatly attributable to the severe 
climate that we are seeing. So we have been on a journey in 
California for over a decade now in terms of really looking at 
emissions and reducing emissions. My own company has been very 
successful. Today, 80 percent of the power that we deliver to 
our customers is greenhouse gas-free and that is a great start. 
The next big area of focus for the State of California as we 
look at how do we continue to drive emissions down is 
absolutely the transportation sector.
    Forty percent of the greenhouse gas emissions in the State 
of California come from transportation. I mentioned 
NOx. I mentioned also particulate matter. There are 
such significant air quality issues in the State of California. 
Eight of the worst climate air quality, sort of, counties in 
the country are in California, so we are all in on dealing with 
the air quality issues, the greenhouse gas issues, and we truly 
believe that transportation provides us an opportunity to go 
through it.
     Ms. Matsui. Could I ask, Ms. Cullen, we talked about 
California and the Nation about the adoption of the EVs and I 
think somebody said one percent across the Nation. And you are 
saying, I think you said in California it is 3 to 4 percent; is 
that right? Are you the one who said that?
    Ms. Cullen. That was Mitch's number.
    Ms. Matsui. OK, good. I was wondering, what is a driver of 
the adoption in California? Is it policy, is it really a 
climate change, what is it? Would you like to comment on that?
    Ms. Cullen. It is a combination of factors. Certainly 
policy helps to drive adoption. Also, it is one of the largest 
car markets. There is a great deal of consumer education also 
in California and I think which is an important point that has 
been brought up by a lot of folks on this panel and a lot of 
the questioners that educated consumers are an important part 
of the deployment mix. And I think California has provided the 
important nonfinancial and financial incentives, the tax 
policy, as well as HOV lane access have also helped to speed 
adoption in the state.
    Ms. Matsui. OK. As you know I have been supportive of 
California's authority under the Clean Air Act to set its own 
light duty vehicle emission standards. And I am obviously 
concerned by the administration's effort to weaken the current 
national standards and the result will be more uncertainty, 
which is really bad for the consumers and the automakers and 
the environment, and last week the State of California and 17 
other states sued the Trump EPA for its decision to revise the 
light duty vehicle standards.
    I will go back to Ms. Williams. I understand that PG&E is 
supportive of the existing standards. Can you explain why you 
are supportive and how these standards affect your utility, 
broadly speaking?
    Ms. Williams. Well, as I mentioned earlier, we truly 
believe that we have unique air quality issues in the State of 
California with eight of the ten worst air quality counties in 
the country, so we truly believe that it is a public health 
issue. We also believe that as we look at climate change, as we 
look at what we need to do to continue to reduce emissions, 
transportation is key to that. And we believe that electric 
transportation in particular is going to provide us a great 
means of reducing the GHG in the air and improve the air 
quality and that is why we are supportive of the California 
waiver.
    Ms. Matsui. OK, thank you.
    And I don't want to leave you out, Mr. Bainwol. The 
automakers are really very important in this and we understand 
that. And I really believe that the EVs, I am looking at how we 
might do this. Listening to Mr. Duncan, we need to really 
expand, we need to have more research and development on how we 
expand types of vehicles that can be EVs. And I think we need 
to expand that aspect of it and if we give too much preference 
or to SUVs and light duty trucks with lower standards, I think 
we will have difficulty actually incentivizing people to buy 
the EVs. That is a comment on my part, if you want to respond.
    Mr. Bainwol. I just note that there is a challenge when the 
market and policy don't align and at some level the consumer is 
always right. So we need to, I think, to some extent when we 
have compliance issues we have got to educate the consumer and 
try to drive adoption, but at the end of the day we have got to 
satisfy the consumer.
    Ms. Matsui. But I think when you drive adoption, you really 
have to give more of a sense of the inventory has to be greater 
too, that is, we are not there yet.
    Mr. Bainwol. Well, the inventory one is coming, but this is 
the alignment. You can't produce if people don't want to buy it 
and we want them to buy it. We want to produce them and we want 
to sell them, but if you produce them and they sit in showrooms 
that does no one any good.
    Ms. Matsui. But if you make more of the other vehicles then 
there would be less incentive to get the EVs.
    Mr. Bainwol. Well, I think the big incentive challenges is 
that the success of the internal combustion engine has gotten 
stronger and stronger. It is up 30 percent in 12 years. So when 
you turn in your 12-year-old car and you go to buy a new car 
and you are asked to pay a delta for an electrified product, 
then you are looking at what you are getting in terms of the 
replacement and it is a pretty good----
    Mr. Shimkus. The gentlelady's time has expired.
    Ms. Matsui. Thank you, Mr. Chairman.
    Mr. Shimkus. The chair now recognizes the gentleman from 
Georgia, Mr. Carter, for 5 minutes.
    Mr. Carter. Thank you, Mr. Chairman, and thank all of you 
for being here, very interesting subject.
    Mr. Bainwol, I will start with you. We were just talking 
about California and their initiatives with the zero emission 
vehicles and what they are trying to do with that program. It 
has got to have an impact on your marketing and on your 
manufacturers and exactly what they are trying to put out there 
for consumers. What are the challenges that you see there?
    Mr. Bainwol. So California does have a zero emission 
vehicle mandate that is rising to as much as 15 percent by 
2025, and a bunch of other states follow that mandate and it is 
a challenge. When there is asymmetry between the market and 
policy it produces cost and so we are working very hard to 
drive down costs and to build range and to make it more 
attractive so compliance is facilitated, but it is a challenge.
    Mr. Carter. What about the hybrids? Is that something that 
has helped ease the transition, if you will?
    Mr. Bainwol. Hybrids help ease the transition certainly for 
the CAFE and GHG programs, but at this point not for the ZEV 
programs.
    Mr. Carter. OK. Mr. Remley, I wanted to ask you, through 
the advent of all this all of a sudden now we have a new 
anxiety, range anxiety. People are, instead of being concerned 
about running out of gas they are concerned about running out 
of electricity. Now this is a concern particularly in a rural 
area like South Georgia that I represent. I don't see a whole 
lot of charging stations in the areas that I represent. What 
kind of challenge is this going to present for your industry 
and how do you plan to respond to this?
    Mr. Remley. So, Congressman, thank you for the question. We 
are looking for the opportunity to participate in the EV 
rollout. What we are looking for is a free competitive 
marketplace to do that. As I said, my company and I know plenty 
others are looking to install EV charging at the various 
different levels, whether it is Level 1, Level 2 or DCFC fast 
charging. It certainly is that rollout and the infrastructure 
needs that are going to be required is a significant investment 
that is going to need to be made in the country over the years.
    I would also like to point out that the current structure 
which is both tax incentives and energy charges through the 
entire rate base to subsidize a very small selection of 
consumers for purchasing these vehicles seems regressive. And 
so as I said, from the SIGMA NACS standpoint we are looking for 
a level playing field so that we can deploy free market capital 
into this exciting new area.
    Mr. Carter. I see this as somewhat comparable, if you will, 
to what we are trying to do with telecommunications. I suspect 
in the rural areas we are going to be the last ones to see this 
type of technology and that is going to penalize us in a sense. 
What is it going to take? Are we going to be looking at 
subsidies or incentives for you to be able to supply those 
areas with that?
    Mr. Remley. I think that is an important policy 
consideration about how rural areas of America will be allowed 
to participate in this. As I said, we are looking if there are 
subsidies or if there is going to be government support that 
that is given to every stakeholder that is currently involved 
in fueling the motoring public. We firmly believe over decades 
of experience that our industry has the best corners and the 
best locations to fuel the motoring public and we are merely 
just looking to participate in that fueling and that change on 
a level playing field.
    Mr. Carter. OK. Ms. McKernan, let me ask you. You are 
consumers. You are the people who belong to your organization, 
what are their concerns? Is it price? Is it range anxiety? What 
are the people out there mainly concerned about? Is it just 
that it is something new that they aren't familiar with or?
    Ms. McKernan. Well, I think actually it is probably a 
combination of everything that you just mentioned. Range 
anxiety definitely plays a role, but for some people EVs may 
fit into their lifestyle if they don't have as far to drive. It 
could be that they have a multiple car household. Most 
households do have more than one vehicle. Learning about the 
technology, and that is why it is so important for us to 
provide the information for consumers and our members is 
because we think the more that they learn about the technology 
and that they have a wide range of choices when buying these 
vehicles that the adoption of this will----
    Mr. Carter. I am not trying to be funny, I am serious. Are 
you all going to have electric rescue vehicles? When somebody 
runs out of electricity are you going to send them--they call 
AAA and they come and they can plug into your little vehicle 
there and recharge and then take off again?
    Ms. McKernan. We actually have piloted a little bit with 
some vehicles that go out and can charge electric vehicles. But 
yes, I mean AAA will move as the technology continues to grow 
so that we can continue to serve our members.
    Mr. Carter. Wow, this is fascinating. Thank all of you for 
being here, I appreciate it. Thank you, Mr. Chairman, I yield 
back.
    Mr. Shimkus. The gentleman yields back his time. And again 
the chair does thank you all for being here. And seeing that 
there are no further members wishing to ask questions for this 
panel, I would like to thank all of you. Before we conclude I 
would like to ask for unanimous consent to submit the following 
documents for the record: An op-ed article by a guy named Mitch 
Bainwol and a letter from Growth Energy. Without objection, so 
ordered.
    [The information appears at the conclusion of the hearing.]
    Mr. Shimkus. In pursuant to committee rules, I remind 
members that they have 10 business days to submit additional 
questions for the record and I ask that witnesses submit their 
response within 10 business days upon receipt of the questions. 
And I think I have one I want to send, so please do that. 
Without objection, this subcommittee is adjourned.
    [Whereupon, at 12:04 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]

                 Prepared statement of Hon. Greg Walden

    I would like to thank Mr. Shimkus for his ongoing and 
comprehensive review of fuels and vehicles policy. There is a 
lot of ground to cover, but we are learning a lot about where 
we are and what we need to do in order to ensure affordable and 
reliable transportation for the American people.
    Our goal is to take full advantage of any emerging 
opportunities that come with the growth of electric vehicles, 
or EVs, in the years ahead, while heading off any potential 
problems. And today, we will explore how EVs fit into the 
personal transportation picture. I thank our witnesses, 
including Dylan Remley of Global Partners, which has operations 
in my home state of Oregon.
    I will say at the outset that I echo Mr. Shimkus' concerns 
about the viability of EVs in rural America. The range of 
today's EVs wouldn't get you even halfway across my district, 
and the electrification revolution has yet to make a real 
impact on the larger work vehicles that many of my constituents 
need and use on a regular basis. So, there is a lot more that 
needs to happen before EVs can work for everyone.
    That said, EVs are slowly but surely addressing their 
shortcomings. Sticker prices are still too high but are coming 
down, range is still too short but is increasing, and charging 
times are still too long but are improving.
    At the same time EVs are ramping up, refiners and 
automakers are actively pursuing ways to improve the 
conventional internal combustion engine in order to remain 
competitive.
    This kind of competition, not just between car companies 
but also between car types, is good for consumers. Indeed, over 
the last twenty years, we have essentially gone from the 
internal combustion engine as the only choice for new car 
buyers, to a world where hybrids, plug-in hybrids, and all-
electric vehicles are also available and come in many models.
    I drive a hybrid on both coasts because it's what works 
best for me. Others may stick with conventional cars, while a 
small but growing number are choosing EVs and plug-ins. But 
consumers win when there are a number of cost-effective options 
to choose from.
    As the vehicle mix changes, it is incumbent for Congress to 
revisit past policies and make sure they are up-to-date. Is 
CAFE working as intended? Does the Renewable Fuel Standard need 
an update? Should high octane fuels and vehicles be given a 
chance? Can the nation's electric grid handle the load? Is 
refueling infrastructure policy working?
    These and other questions will be addressed by today's 
diverse panel and I thank them for their participation and 
yield the balance of my time.
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