The state of California will be spending $286.4 billion during the 2022-2023 fiscal year. Out of the total budget, $22.5 billion will go to climate-related goals while EV-related investments will take $6.1 billion.
Governor Gavin Newsom has signed off on the budget and took a gentle swipe at the federal government for not doing enough to fight climate change.
California will be focusing on EV initiatives as the transport sector accounts for more than half of the greenhouse gas emissions in the state, according to Gov Newsom.
Newsom indicated that battery-powered vehicle makers are flocking to his state. He didn’t mention any company by name, but automakers like Rivian and Lordstown Motors have established a presence in the state. Also, it is the birthplace of the biggest EV company in the world, Tesla, although the CEO moved the headquarters to Texas last year for tax and regulatory reasons.
Other EV-related companies like ChargePoint and Electrify America, both with the first and second largest market share in the EV charging space, are also very active in California.
Furthermore, California is betting heavily on lithium, with plans to become a key player in the extraction of the mineral, with brine deposits located near the Salton Sea. Lithium is a crucial raw material in the manufacture of lithium-ion batteries used in electric vehicles.
The proposed $6.1 billion spending will cover 5 to 6 years EV spending. The fund will come from several sources; $3.5 billion from the state’s General Fund, $1.5 billion from Proposition 98, $676 million from the state’s Greenhouse Gas Reduction Fund, and $383 million from the federal government.
The fund will be partly disbursed as follows:
- Low-Income Zero-Emission Vehicles and Infrastructure—$256 million to subsidize EV purchases for low-income consumers, and $900 million to expand public charging in low-income neighborhoods.
- Heavy-Duty Zero-Emission Vehicles and Supporting Infrastructure—$935 million to add 1,000 zero-emission short-haul (drayage) trucks and 1,700 zero-emission transit buses; $1.5 billion to support electric school buses; $1.1 billion for zero-emission trucks, buses, and off-road equipment and fueling infrastructure; and $400 million to enable port electrification.
- Zero-Emission Mobility—$419 million to support sustainable “community-based transportation equity projects” that increase EV access in low-income communities.
- Emerging Opportunities—$200 million for demonstration and pilot projects in high carbon-emitting sectors, including maritime, aviation, and rail.
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