Dennis Schroeder, National Renewable Energy Laboratory
This blog is co-authored with Yeh-Tang Huang from the Natural Resources Defense Council and Aaron Kressig from Western Resource Advocates
Colorado has an important opportunity to provide significant air quality, health, and economic benefits to its residents.
In April, Colorado adopted the Advanced Clean Trucks rule and the Low-NOx (nitrogen oxide) rule, both of which will reduce pollutant emissions from medium- and heavy-duty vehicles. Now, the state also can help clean up its light-duty vehicles by fully adopting the Colorado Clean Car Standard to 2035.
Under this standard, manufacturers would sell increasingly higher percentages of new zero-emission vehicles (ZEVs) in each model year (MY), namely 43 percent new ZEV sales in MY 2027 and eventually 100 percent new ZEV sales in MY 2035. In this case, ZEVs include battery electric vehicles, plug-in hybrid electric vehicles, and fuel cell electric vehicles.
A new analysis from ERM, commissioned by the Sierra Club, NRDC (Natural Resources Defense Council), and Western Resource Advocates, shows the potential significant public health, environmental, and economic benefits from the Colorado Clean Car Standard under different scenarios.
Policy Scenarios
The report evaluated the following scenarios:
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Baseline: All new light-duty vehicles sold in Colorado continue to meet existing vehicle standards. ZEV sales increase but are capped at one-third of new vehicle sales each year.
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Clean Car Flex: Colorado adopts the Clean Car Standard starting in MY 2027, and vehicle manufacturers use many of the available compliance flexibilities such that they sell fewer ZEVs than is nominally required by the regulation.
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Clean Car Flex + Clean Grid: Colorado adopts Clean Car Standard starting in MY 2027 and reaches 100% clean electricity generation by 2040. Manufacturers use many of the available compliance flexibilities.
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Clean Car Full + Clean Grid: Colorado adopts Clean Car Standard in MY 2027 and reaches 100% clean electricity generation by 2040. Manufacturers do not use any of the compliance flexibilities.
Public Health and the Environment
Compared to the Baseline scenario, by 2050 the Clean Car scenarios with a clean grid are estimated to reduce annual LDV fleet NOx emissions by 92% and PM emissions by 91%. The impact on Colorado residents cannot be understated. This would deliver much cleaner air and better health: The resulting cumulative public health benefits between 2027 and 2050 include 216 to 236 fewer premature deaths, 205 to 225 fewer hospital visits, and 132,900 to 146,680 fewer minor cases of illness. The value of these public health benefits totals $2.6 billion to $2.8 billion.
Compared to the Baseline scenario, under the Clean Car scenarios cumulative greenhouse gas (GHG) emission reductions from Colorado’s light-duty fleet reach between 190 and 220 million metric tons of CO2e from 2027 through 2050. The benefits of these GHG emissions reductions are valued at $15.5 billion to $17.8 billion.
Economic Impacts
By the time the full Clean Car Standard is launched, in MY 2027, the average light-duty ZEV in Colorado will save its owner approximately $14,250 in lifetime costs compared to a conventional vehicle.
Drivers purchasing a ZEV in MY 2030 or after could save up to $16,100 in lifetime costs.
For rural Coloradans, who are assumed to prefer a longer-range ZEV with higher up-front costs, an MY 2027 ZEV will save its owner $5,900 over its lifetime compared to a gasoline vehicle, and for an MY 2030 ZEV, lifetime costs will be about $14,350 lower. Rural drivers of ZEVs purchased after MY 2030 will enjoy total savings of more than $19,000.
Under the Clean Car Flex scenarios, annual net utility revenue from light-duty electric vehicle charging is projected to be $27 million in 2030, $372 million in 2040, and $614 million in 2050.
The Clean Car Full + Clean Grid scenario nearly doubles net utility revenue in 2030 to $50 million, with $385 million in revenue in 2040, and $616 million in 2050.
Since the Clean Car Standard will likely increase utility net revenue as it electrifies Colorado’s LDV fleet, Colorado’s average residential and commercial rates could be 11 percent lower by 2050. The average Colorado household could therefore save $153 each year on its electricity bill, and the average commercial customer $959 each year.
The deployment of ZEV charging infrastructure will also bring substantial investments to the state. Implementing the Colorado Clean Car Standard will require more than 3 million in-use charge ports. Purchasing and installing these chargers will bring approximately $7 billion in cumulative investment by 2050.
Adopting the Colorado Clean Car Standard will result in a net increase of more than 4,900 jobs by 2050. Average wages for the new jobs created are expected to be nearly 50 percent higher than average wages for the jobs that will be replaced.
Conclusion
Taken together, the cumulative net societal benefits by 2050 reach $89.9 billion under the Clean Car Flex scenario, $91.3 billion under the Clean Car Flex + Clean Grid scenario, and $95.1 billion under the Clean Car Full + Clean Grid scenario.
To fully capture the most benefits, Colorado must adopt the Clean Car Standard before the end of this year so that it applies to MY 2027, and it is critical that the state adopt the program through its MY 2035 endpoint.
This way, Coloradans can fully receive the significant public health, climate, and economic benefits as the state transitions to a clean transportation system.