PUTTING PUBLIC DOLLARS TO WORK VOUCHER INCENTIVE PROGRAMS FOR CLEANER TRUCKS AND BUSES Northeast Diesel Collaborative December 4, 2018
AGENDA CALSTART overview Basics of a Voucher Incentive Program VIPs in practice: CA, NY, Chicago Funding sources & design elements Case studies Getting started on a VIP Group discussion and questions 2
CALSTART: CHANGING TRANSPORTATION FOR GOOD 3
WHAT IS A VIP (VOUCHER INCENTIVE PROGRAM)? Mechanism to distribute clean vehicle funds Reduces upfront costs to fleets Provides immediate reimbursement Brings automakers into new markets Accelerates cleaner deployment of medium- and heavy-duty vehicles Can be supported from many funding sources 4
WHY A VIP? FASTER, EASIER FLEET ADOPTION Provides equitable access to clean vehicles Point-of-purchase incentive gets funds to fleet operators quickly and with certainty Directs funds to shovel-ready projects Adaptability for new vehicle technologies, fleets users, vendors, and manufacturers Dealer network reduces inefficiencies and creates familiarity with process Builds a robust, regional clean vehicle economy 5
WHY A VIP? MORE FLEXIBLE PROGRAM DESIGN Voucher programs can be tailored to: Support various technologies/fuels/vehicle classes Conform to requirements of funding source(s) Set funding caps by category Emphasize environmental justice 6
HOW DOES A VIP WORK? 1 MANUFACTURER OR DEALER APPLIES TO LIST VEHICLES FOR VOUCHER ELIGIBILITY AND WEBSITE LISTING 2 VENDOR SELLING APPROVED VEHICLE APPLIES TO BE APPROVED VOUCHER RECIPIENT 3 FLEET PURCHASES ELIGIBLE VEHICLE FROM ELIGIBLE VENDOR; VOUCHER $ SUBTRACTED AT POINT OF SALE 4 VENDOR USES VOUCHER PROCESSING CENTER TO PROCESS VOUCHER REQUEST 5 ONCE VEHICLE IS DELIVERED AND ALL DOCUMENTATION IS SUBMITTED, VENDOR IS REIMBURSED 7
USER PERSPECTIVE Fleets can search for vehicles by technology type or vocations, determine incentive amounts, and contact vendors Vendors work with voucher processing center to complete vehicle deployment and reimbursement EXAMPLE OF VEHICLE LISTING FROM CA HVIP WEBSITE 8
WHERE ARE VIPs IN PLACE? California Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project (HVIP) New York Truck Voucher Incentive Program (NYT-VIP) Drive Clean Chicago (DCC) 9
California Hybrid and Zero-Emission Truck and Bus Incentive Project (HVIP) Agency partners Funding amount Funding source CARB $313 million to date CA AB32 Cap-and-Trade Auction Revenues Voucher types Electric technologies (all-electric, hybrid-electric, electric power take-off/utility) Low-NOx natural gas Voucher amount 50-100% of incremental cost, up to $300,000 Vehicle classes 2-8 (GVWR >6,000) Eligible fleets Availability Distinguishing features Private, public, non-profit First-come, first-served, $80 million available now Escalators for vehicles domiciled in disadvantaged communities (CalEnviroScreen 3.0) 10
CALIFORNIA HVIP INCENTIVES Zero-emission trucks and buses Hybrid truck conversions Low-NOx NG GVWR (lbs) Outside DAC In DAC 5,001 8,500 $20,000 $25,000 8,501 10,000 $25,000 $30,000 10,001 14,000 $50,000 $55,000 14,001 19,500 $80,000 $90,000 19,501 26,000 $90,000 $100,000 26,001 33,000 $95,000 $110,000 >33,000 $150,000 $165,000 Hydrogen Fuel Cell Electric Truck $300,000 $315,000 GVWR (lbs) 6,001 8,500 $2,000 8,501 10,000 $6,000 10,001 19,500 $9,000 19,501 26,000 $12,000 26,001-33,000 $15,000 > 33,000 $18,000 $45,000 11
New York Truck Voucher Incentive Program (NYT-VIP) Agency partners Funding amount Funding source NYSERDA, NYSDOT, NYCDOT $19 million CMAQ Voucher types Alternative fuel vehicles (hybrid-electric, natural gas) in NYC Diesel emission control devices in NYC All-electric vehicles statewide Voucher amount 80% of incremental cost, up to $150,000 Vehicle classes 2b-8 (GVWR >8,500) Geographic restrictions Eligible fleets Availability All-electric vehicles must be domiciled 70% of time in one of 30 non-attainment counties Private, public, non-profit First-come, first-served 12
NYT-VIP INCENTIVES Voucher covers up to 80% of incremental cost, subject to cap Cap varies by technology/fuel and vehicle class 13
Drive Clean Chicago (DCC) Agency partners Funding amount Funding source Chicago DOT $12 million CMAQ Voucher types Trucks: hybrid and all-electric Taxis: hybrid and all-electric Voucher amount Truck: 80% of incremental cost, up to $150,000 Taxi: 80% of incremental cost, up to $10,000 Vehicle classes 2b-8 (GVWR >8,500) (truck program) Eligible fleets Geographic restrictions Availability Distinguishing features Private, public, non-profit Must operate in 6-county Chicago area First-come, first-served no funds left EV charging stations eligible for funding 14
Technology # Vehicles % Amount Hybrid-electric 2,405 62% $ 62,644,776.12 Zero-emission 1,286 33% $ 119,745,335.00 epto 161 4% $ 3,898,000.00 Total Electric 3,852 100% $ 186,288,111.12 Low-NOx Engines 1,044 100% $ 11,554,933.00 Technology # Fleets # Vehicles Voucher Funds DPF 9 124 $2,452,304.80 EV 18 65 $5,673,093.00 CNG 4 71 $3,033,524.00 CNG Conversion 4 15 $334,272.00 Hybrid 22 83 $1,198,179.20 Hybrid Conversion 3 236 $1,830,776.00 Total 60 594 $14,522,149.00 Technology # Fleets # Vehicles Voucher Funds EV-Truck 18 49 $5,846,717.00 Hybrid-Truck 37 239 $5,430,160.00 Total Truck 55 288 $11,276,877.00 EV-Taxi 4 85 $855,440.00 CNG-Taxi 1 2 $16,000.00 Total Taxi 5 87 $871,440.00 15
FUNDING SOURCES Various sources can help states and localities fund clean vehicle voucher programs Volkswagen Appendix D (Mitigation Trust) Settlement Federal: CMAQ, DERA State or Regional Cap-and-Trade (California AB32, RGGI) Other: Bond measures (e.g., Prop 1B in CA) Funding should be reliable, long-term, and have clearly stated terms and conditions The VIP tool Is robust to the program requirements of various funding sources Can be stackable with other incentive funds 16
FUNDING SOURCES: EXAMPLES OF REQUIREMENTS CMAQ Subject to Buy America provision Status of waivers unclear going forward Volkswagen Appendix D Class 4-8 only Requires diesel engine scrappage CA AB32 Emphasizes GHG reductions; natural gas not included within main HVIP program Low-NOx NG in separate fund administered through same program 17
GEOGRAPHIC PRIORITIZATION AND ENVIRONMENTAL JUSTICE NEW YORK S VIP HAS RESTRICTED VEHICLE DEPLOYMENT TO COUNTIES IN OR RECENTLY LISTED FOR NON-ATTAINMENT TO COMPLY WITH CMAQ PROGRAM REQUIREMENTS CALIFORNIA S VIP PROVIDES ADDITIONAL FUNDING FOR VEHICLES DOMICILED IN AREAS DESIGNATED AS DISADVANTAGED 18
RUBBER MEETS ROAD: DHL ELECTRIC VEHICLES (NYT-VIP) 22 all-electric (BEV) cargo vans used in NYC Zenith Motors creates opportunities for electrification NYT-VIP creates flexibility to right-size vehicles and range for fleet needs 19
RUBBER MEETS ROAD: COM ED HYBRIDS (DCC) Six hybrid Power Take- Off (PTO) systems made by Odyne Systems Electrified bucket trucks eliminate idling and improve efficiency Fuel savings will achieve payback of incremental cost within 3 years Vehicles operate more efficiently due to less time spent fueling while promoting clean vehicle technologies in local communities 20
RUBBER MEETS ROAD: MANHATTAN BEER CNG TRUCKS (NYT-VIP) 150 CNG delivery trucks in regional fleet Volvo trucks with Cummins CNG engines Vehicles are spacious and reliable CNG models keep deliveries on schedule Green technology helps generate new business New technologies and fleet incentives have made CNG trucks favorites of drivers 21
VENDOR PERSPECTIVE Mike Saxton Chief Commercial Officer Orange EV has placed 10 EV terminal tractors into service through NYT-VIP 22
GETTING STARTED ON A VIP 1. Determine requirements of funding source Contact us to determine how a voucher program can fit the contours of your funding source 2. Determine whether State agencies can directly provide funding or require a passthrough entity 3. Establish list of eligible technologies 4. Set up mechanism for vendors to get prequalified 5. Identify marketing and outreach partners, engage in outreach campaign 6. Post program information and impact tracking online 23
GET INVOLVED IN A VIP! CALSTART points of contact: Dan Welch dwelch@calstart.org (718) 589-7726 Ben Mandel bmandel@calstart.org (929) 295-6540 Voucher Incentive Program websites: CA HVIP: https://www.californiahvip.org/ NYT-VIP: https://truck-vip.ny.gov/ Drive Clean Chicago: http://www.drivecleanchicago.com/ 24