Gas War: California Finalizes Combustion Ban Plan
The California Air Resources Board (CARB) is supposed to vote on stricter rules that will ban the sale of new gasoline-powered cars by 2035 later today. But we already know what the results will be because the organization is about as mentally homogeneous as a eusocial insect colony and is strongly supported by the state government. So let’s cut to the chase and hear what California has to look forward to before seeing what kind of combustion bans are taking place in other parts of the world.
For starters, we need to clarify that it’s not the citizenry that will be voting whether or not to ban internal combustion vehicles by 2035. That privilege has been given to CARB members, who plan on setting interim quotas for zero-emission vehicles. Though that term is somewhat of a misnomer, as the construction of electric cars still produces a sizable amount of pollution. Charging likewise produces emissions. But they’re now stemming from nearby power stations, rather than vehicle exhausts.
The board’s proposal would effectively establish quotas for how many new vehicles sold inside California have to be electric or hydrogen-powered, starting with making them 35 percent of all new vehicles sold from the 2026 model year. The number goes up every year and is anticipated (by CARB) to reach over half of all new vehicle sales by 2028. Eventually, the goal is to get to 100 percent by 2035, leaving a little bit of wiggle room for plug-in hybrids.
“This is monumental,” CARB member Daniel Sperlingsaid told CNN earlier this week. “This is the most important thing that CARB has done in the last 30 years. It’s important not just for California, but it’s important for the country and the world.”
Sperling said the proposals saw “surprisingly little debate” and push back from car companies while being drafted. He took that as a sign that the industry was fully on board with the move to zero-emission vehicles, adding that several companies have already made formal announcements that they’ll eventually build nothing but EVs.
“The car companies see what’s happening in China, in Europe,” Sperling said. “Many of them have already made announcements about how they’re converting totally to electric vehicles.”
California has been beating this drum for a while and Gov. Gavin Newsom signed an executive order in 2020 mandating that all vehicles sold within the state be of the zero-emissions variety by 2035. This was after the region had become ground zero for opposing Donald Trump’s fueling rollback that would have scaled down the stringent Corporate Average Fuel Economy (CAFE) standards established under the Obama administration. During that period, California had also launched numerous lawsuits to reinstate another legal decision flipped by Trump that granted it the ability to determine its own vehicle emission standards and attempted to recruit other blue states to adhere to its environmental policy, rather than the one presented by the federal government. Washington is now broadly aligned with the Golden State’s goals and the Biden administration reinstated California’s ability to make its own fueling rules upon taking office.
However, none of this actually ensures that every new vehicle sold on the West Coast will be fully electric in the coming years. Internal combustion bans are all the rage among government officials and automotive executives. But the target has been moved back on numerous occasions. Several years ago, 2030 was frequently given as the collective target to kick gasoline-powered cars to the curb. Now it’s 2035. A few years from today, it may be 2040. While often ignored by bureaucrats, market conditions still play a factor here and EV price increases continue to outpace their combustion-reliant counterparts due to production issues and difficulties sourcing the raw materials needed for battery construction.
Meanwhile, The Guardian recently reported that the customer-owned Bank Australia is planning to stop offering loans for “new fossil fuel cars” after 2025. A formal announcement is planned to take place at a national EV summit in Canberra on Friday, with the bank arguing that it needed to ensure its lending practices did not “lock our customers into higher carbon emissions and increasingly expensive running costs.”
Sasha Courville, the bank’s chief impact officer (something I’ve never heard of), told the outlet it would continue to fund loans for second-hand cars using internal combustion engines “as it recognized not everyone would be able to afford an EV in three years.”
She also claims it would send a message to consumers. That message is, “if you’re considering buying a new car you should think seriously about an electric vehicle, both for its impact on the climate and for its lifetime cost savings.”
“We’ve chosen 2025 because the change to electric vehicles needs to happen quickly and we believe it can with the right supporting policies in place to bring a greater range of more affordable electric vehicles to Australia,” Courville explained.
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If you’re an investor in the industry itself, two words, auto aftermarket.
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