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Oil Industry Attempts To Quash The Growing Electric Car Movement

Oil industry titans are not big fans of the booming electric car movement. Groups backed by companies like Exxon Mobil are attempting to put the kibosh on plans to build charging stations across the US. Oil-backed groups have challenged the plans of electric companies in 10 states, according to POLITICO, pursuing regulatory and lobbying campaigns against utility companies that want to increase the power supply and build charging networks in more than half the country.

“Fossil fuel interests control 90 percent of the transportation fuel market in the US and are really feeling threatened,” said Gina Coplon-Newfield, director of the electric vehicle initiative at the Sierra Club.

In the Midwest, the American Fuel and Petrochemical Manufacturers, a trade group for gasoline producers, has opposed charging station plans in Kansas and Missouri as well as Colorado’s new zero-emission vehicle mandate as part of a “Freedom to Drive” coalition of dealerships and oil companies. Consumers should not have to fund incentives or charging stations that mostly benefit upscale drivers that can afford electric vehicles like Teslas, they say.

“We feel like we're on the side of the angels here in terms of wanting this to be a free market and not wanting people who don't use the service to have to pay for service,” said Derrick Morgan, senior vice president at the fuel and petrochemicals group.

In Illinois and Iowa, the American Petroleum Institute (API) has joined forces with Americans for Prosperity to counter the investment of utility companies in electric cars. In Minnesota, a large refinery owner is working with industrial interest groups to fight utility charging and shared mobility plans.

In Massachusetts, API, gasoline marketers and convenience stores are against an electric vehicle charging buildout from the utility National Grid, and the Western States Petroleum Association opposes utility charging plans in Arizona and electric vehicle legislation in California. And in Maryland, API joined convenience stores, gasoline stations and truck-stop owners to combat the electric vehicle plans of utility companies.

Oil groups claim that utility companies are using electric vehicle infrastructure to increase revenues since consumers will have to fund the investments. Utility companies, on the other hand, say the cost of charging stations is marginal for consumers, and that consumers' bills may decrease as electric vehicle adoption increases since the cost of power grid infrastructure will be offset by the greater demand for power.

So far, the oil industry hasn’t had much success in opposing utility plans. “So far, the main consequence [of oil lobbying] I've seen has been some delays, but I think the fight is ongoing,” said Samantha Houston, a clean vehicles analyst at the Union of Concerned Scientists. “I wouldn't attribute modifications to electric vehicle programs to API, but they are certainly making a good attempt to muddy the waters in their interventions.”

It is uncertain if gasoline-powered vehicles can hold onto the market. By 2040, electric vehicles may account for 40 percent of the US passenger vehicle fleet and 60 percent of sales, up from 2 percent of sales today, according to Bloomberg New Energy Finance. That would reduce demand for oil by more than 3 million barrels a day — or more than 20 percent of current transportation consumption.

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Electric vehicle mandates in China and Europe hope to phase out gasoline vehicles by 2040 or sooner, which will increasingly lower the cost of batteries, said, David Doherty, an oil specialist at Bloomberg New Energy Finance. "Then we'll see electric vehicles really ramp up as a percentage of sales.”

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