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Top Democratic Senator Proposes $454B Plan to Speed up Transition to EVs

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Sen. Chuck Schumer, the top Democrat in the U.S. Senate, has proposed a plan to help speed up the transition from gas-powered vehicles to electrified ones. The plan calls for an investment of $454 billion over a period of 10 years, at the end of which 25% of vehicles on American roads, or 63 million in all, will be electrified.

The plan is driven by the need to reduce the transportation sector’s impact on climate change. According to Sen. Schumer, this sector accounts for one-third of the carbon emissions produced in the United States.

According to the plan, $392 billion would be spent in the form of subsidies to owners of gas-powered vehicles that are at least eight years old to encourage them to trade those in for an all-electric, plug-in hybrid or hydrogen fuel-cell vehicle. The older vehicles would be taken out of circulation.

Buyers of EVs would benefit from a discount ranging between $3,000 and $5,000 for an green vehicle, and get an additional $2,000 discount if the vehicle is American-made.

This last clause is pretty clearly political in nature, part of a fierce struggle between Democrats and Republicans each vying to win the support of auto workers, notably in the Midwest which will be a crucial election battleground in 2020.

The proposed plan would, according to Sen. Schumer, "reduce the number of carbon-emitting cars on the road, create thousands of good-paying jobs, and accelerate the transition to net-zero carbon emissions by mid-century."

Back in 2009, the Cash for Clunkers program offered consumers a financial incentive to turn in their old gas-guzzling cars. The main objective at that time was to give a boost to an automotive sector weakened by the 2008 financial crisis. That program doled out some $3 billion to vehicle owners.

Included in the new plan is a $45 billion investment to build up a charging station network, and $17 billion would be allocated to the auto manufacturers to help them build or upgrade factories to produce electrified vehicles.

The stated objective is that by 2040 all vehicles on American roads should be “clean”.

As laudable as Sen. Schumer’s plan is, it is an absolute certainty that it will be met with fierce resistance from the American Senate, and is sure to be dead on arrival if current president Donald Trump is re-elected in 2020.

Stay tuned…