Vermont Legislature SmartTranscripts:

[Matt Walker (Chair)]: And we are. Good afternoon, Tuesday, February 24. House Transportation. Welcome back to committee for the week. Excellent. Mute on there. And as with the cases wherever we can possibly do it, can't always, but very close. Committee members request testimony and we do the best we can to deliver. This afternoon, we're starting with Gerard Duvall, Energy Action Network. And he's working on, I think, probably a presentation to share. And welcome to committee and requested. Otherwise, unless without any other to do, we'll turn it over to you, and welcome.

[Jared Duval (Executive Director, Energy Action Network)]: Thank you, Chair Walker. Members of the committee, thank you for the invitation. Glad to be with you this morning. Let me go ahead for this afternoon. Let me go ahead and share my screen and make sure that that it's going to work in terms of slides. Great. Great. So good afternoon. For the record, my name is Jared Duvall. I serve as executive director of Energy Action Network. And I am here to share with you some of the key findings of our recently released annual progress report for Vermont on energy affordability and emissions. I'm especially going to focus today on transportation affordability and transportation costs and potential savings. But before I dive into that, I want to just set a little bit of context about EAN. We are two things. We are both a network and an organization. So the network is comprised of over 200 member organizations, businesses, nonprofits, utilities, colleges and universities, basically any organization in the state of Vermont that wants to work together towards meeting our energy and climate commitments. And so we serve as a neutral convener to bring diverse stakeholders together to learn about and work on energy issues in Vermont. And I've seen many folks around this table at our conferences, at speaker series events. So so thank you for that. And then in support of our network, we have a small, what we call a backbone nonprofit organization that supports the network in the state of Vermont in two key ways. One is to serve as an independent provider of data tracking research and analysis to help ensure that Vermont's energy conversation is grounded in the latest available data data, high quality analysis, and the latest facts and evidence that we can collect and share. And then beyond that, we also And we present that in our annual progress report. I've brought copies of that today for all of you hard copies that I'll pass out at the end. And most of the slides that I'm going to share today come directly from graphs and infographics in that report. And the page number is noted at the bottom of the slide if you're interested in a particular graph to go and look at it in more detail. We also publish research papers, briefs, other reports throughout the year and maintain energy and emissions dashboards on our website at eanvt.org. But what we're most known for is this flagship report, the most recent version of which you see on the left, and that I'll be presenting from today. So in Vermont, in recent years, so much of the conversation in the State House and around kitchen tables has rightly been around affordability. And when we look at affordability, broadly speaking for households in Vermont, I think that this committee has a really important role because you look at average household expenses and transportation is on the second largest household expense after housing. And within energy costs, transportation is the largest source of energy costs. It's about 45% of what households spend on energy goes to transportation. That's more than for heating, and it's more than for electricity. So with this report, what we wanted to do is analysis that looks at how much money is Vermont spending on energy, and what does it cost for Vermonters and and average households. Of course, there's a range within that. So let's let's start with the big picture in the latest year for which we have full data. 2023, this data comes from

[Unidentified Committee Member]: the tax department and the joint fiscal office. Over $3,300,000,000 was spent on energy in Vermont, and over 2,000,000,000 of that was spent on fossil fuels for transportation and heating. Again, the largest single energy expense in the state was transportation, mostly gasoline and diesel, to get around at $1,400,000,000. And you see that in the blue wedges of this pick your favorite breakfast, treat, donut or bagel chart.

[Jared Duval (Executive Director, Energy Action Network)]: So that's a snapshot of the latest data. We can also look at this, how this has changed over time. And this graph shows two things. In the orange line, which relates to the right hand y axis in orange, you can see fossil fuel consumption over time. And this is measured in trillion BTUs, total energy use in Vermont. And you can see that it has been relatively flat for the last four or five years. But what we're spending on energy has not been flat. And you can see this really starkly if you look for instance, comparing the years 2021 and 2022, where again, energy consumption flat, this orange line here. Vermonters were not purchasing more energy, but they paid $700,000,000 more for that same amount of energy. And the biggest reason for that was because of price spikes in the fossil fuel market because of our exposure to those global commodity markets where there is a significant amount of price volatility. Twenty one to twenty two is the period of time after which Russia invaded Ukraine. We saw global fossil fuel prices spike, and that had an effect on Vermonters wallets collectively $700,000,000 more spent on fossil fuels in just one year. And while those prices have gone down in the years since,

[Matt Walker (Chair)]: we

[Jared Duval (Executive Director, Energy Action Network)]: are still paying more in recent years than we were, you know, in pre pandemic and pre '21 '22. Again,

[Unidentified Committee Member]: this

[Jared Duval (Executive Director, Energy Action Network)]: is organized by fuel type. You can see the largest single expenditure in Vermont is for gasoline over a billion dollars a year in 2022 and near a billion each of the last couple of years for which we have data.

[Matt Walker (Chair)]: Jared, do have any idea what this cold weather and long winter is gonna do to that chart for 'twenty five and 'twenty six?

[Jared Duval (Executive Director, Energy Action Network)]: Yeah. When it comes to fossil fuel use in the thermal sector, in the heating sector, it's largely driven by how cold the winters are, heating degree days. And we've seen that fuel oil use, propane use, fossil gas use or natural gas use, whatever you call it, of course, goes on as we have colder winters. And this is this has been a very cold one. I I we I don't have, you know, the the heating degree day data for the full winter yet. But as a volunteer and a board member with Montpelier's emergency cold weather shelter that is open every night when it's below 10 degrees. And we've been open forty nights this winter, so it is a cold winter. So this what I just shared was was high level statewide costs. If we look at what Vermonters are facing at a household level, this is average energy costs. For an example, Vermont household that has two vehicles, which is average for Vermont, and that heats with fuel oil, which is the most common heating source in Vermont. And what we saw, like, you know, we go back to the the those price spikes from 21 to 22. Average Vermont households saw $2,500 increase in their energy costs. $2,500 increase in energy costs in one year, primarily because of price spikes related to gasoline and fuel oil. And those have remained elevated at over $7,000 a year average energy costs in in the last couple of years for which we have data. You can see how this breaks down here. And EAN isn't the only organization that's looking at these costs. Efficiency of Vermont does a great report called the Vermont Energy Burden Report. And they have found similar things that when we look at energy costs by household across Vermont, on average transportation is the largest single energy expansion, about 45% of household energy costs. So we've talked about the high Yes, represent what?

[Candice White (Member)]: Yes, just, Jarett, on the transportation costs, are we just looking at the cost of gasoline? Are looking at cost of a peak to a car and all those other things?

[Jared Duval (Executive Director, Energy Action Network)]: It's a great point. And I have some slides later that incorporate costs of operation and maintenance that go beyond just fuel. But those slides were just direct energy costs. Didn't include vehicle costs, didn't include maintenance costs, didn't include insurance costs. But the earlier figure that I cited in terms of transportation being the second largest average household expense, that's not just including the fuel cost. That's when you account for vehicle purchase or lease costs, insurance costs, maintenance costs, all in. Yeah.

[Matt Walker (Chair)]: On that previous slide, we don't mind real quick. So it costs more to people to drive their car than it does to heat their house or cool their house and turn the electricity on.

[Jared Duval (Executive Director, Energy Action Network)]: On average, that's right. For the average gas,

[Matt Walker (Chair)]: I guess, and the other two could market.

[Jared Duval (Executive Director, Energy Action Network)]: Yeah, it does vary depending on what your heating source is. So Vermonters who are heating with fuel oil or propane, those are the two most expensive heating fuels available. So it's possible if you live in a large unweatherized house and you're heating with heating oil or propane, then your heating costs might be larger than your transportation costs. But on average, transportation is about 45% of total energy costs. It's interesting because so much of the energy affordability conversation right now is about electricity rates, and electricity rates are incredibly important. But in terms of how much attention is paid to that, when on average it's 20% of household energy spending versus how little attention comparatively, not on this committee, but elsewhere, like, you know, just in public discussion, we should be focusing a lot more on the 80% of costs that come from largely from our fossil fuel dependence for transportation and eating.

[Phil Pouech (Ranking Member)]: Would you say that if we have more focus on electricity because we can control the state control costs of electricity and we have really I think

[Jared Duval (Executive Director, Energy Action Network)]: as a more I think as a more regulated sector, it's it's clearer the role that entities like the Public Utility Commission and the legislature can have as it relates to electricity prices. I think also there is this I I see it often in the media that the the terms electricity and energy are used interchangeably. And electricity is a form of energy, of course, but it's it's not the whole story. And I think there may just be this sense that people aren't as used to thinking about transportation and heating as energy sources as we are about electricity. But when we do our analysis, we're trying to utilize a total energy framework. You know, energy, you can go back to ancient Greek philosophers. Aristotle talked about energy being the capacity to do work. And so energy is not just electricity. It's also fuels that get burned to create heat or to move or for combustion to to move a vehicle. So I think that that total energy framework is really important so we can see the big picture. So I've talked about energy costs, high costs, especially of fossil fuels. There's in the price volatility that we see in those markets. Another really important comparison, especially between fossil fuels and electricity, is what do those fuels mean for or do in relation to the Vermont economy? Fossil fuels are 100% imported into Vermont. And most of the cost of them goes to is the commodity cost of the fuel that we pay, you know, these multinational corporations that supply the fuel. Most of the cost is the wholesale cost of the fuel, and very little of that money ends up staying and recirculating in Vermont. You know, one way to think of it is what's the difference between the wholesale price and the retail price? The retail price you're adding on, what is the cost of labor, what is the cost of delivery. A very small share of only about a quarter of the money that we spend on fossil fuels in Vermont actually stays and recirculates in Vermont going to Vermonters. Most of it is going out of state. In contrast, when we spend a dollar on electricity, a far higher share of that stays and recirculates in state because when we look at an electricity bill, most of the cost of that goes to line maintenance, tree trimming, customer service operations. And and, yes, power purchases, some of which are local. And but even when they're not in Vermont, more of that money is staying locally in the region, in New England or in going to Quebec or or New York rather than going to fossil fuel exporting countries around the world.

[Matt Walker (Chair)]: So I'm sorry. Are you saying that our electricity supplier, our biggest electricity supplier in Vermont, is not a multinational corporation?

[Jared Duval (Executive Director, Energy Action Network)]: I'm talking about where the dollars that we spend on electricity. Where does

[Kenneth "Ken" Wells (Member)]: that next

[Matt Walker (Chair)]: I'm just saying you went out of your way to make sure it was clear it was multinational. Who owns Green Mountain Power?

[Jared Duval (Executive Director, Energy Action Network)]: So what I'm trying to talk about is the is the location

[Matt Walker (Chair)]: be fair.

[Jared Duval (Executive Director, Energy Action Network)]: So what I'm trying to talk about is the location of these companies and where the dollars that get spent go. So Green Mountain Power, as an example, this is also true of our other utilities in state. When we when ratepayers pay a bill to them, a much higher portion of their costs goes to labor and line maintenance and electricity delivery. So Vermonters see more of that money in the form of wages to the folks who work for those companies than the the folks than the energy suppliers that may be out of state.

[Matt Walker (Chair)]: I think I understand that. I that's not a green mountain powered cruise that are out there and a lot of other village electric crews and whatnot are certainly higher than done here. But I do understand that remountain power is a multinational corporation. Okay, because I would say that to make it clear that most of the energy that comes into our state is imported and it is paid to a multinational corporation. That's all I'm saying. It went out of the the way I heard your testimony is that somehow Green Mountain Power wasn't a multinational, and that money isn't headquartered in another country.

[Jared Duval (Executive Director, Energy Action Network)]: I would say that a a key difference is that Green Mountain Power is a regulated utility. We don't regulate the the the the multinational fossil fuel market. And when those dollars when we pay those dollars to them, there are very few employees in our state or in our region. So most of that money is is leaving. Whereas, regardless of the ownership structure of Green Mountain Power or other utilities, when we're paying money on electric bill, much more of that stays locally and goes to Vermont.

[Matt Walker (Chair)]: Does that include all of the convenience stores and all of the distributors and all of the?

[Jared Duval (Executive Director, Energy Action Network)]: Yeah. And that's in the piece. That's in the 24. So some share of money that we spend on fossil fuels does stay and recirculate in Vermont going to a gas station, going to a fuel delivery company. But most of the cost of fossil fuels is to pay for the wholesale commodity product, which is 100 percent imported. And that's different than our electricity sector, where we do produce some electricity locally. Even the electricity that we don't produce locally isn't coming from Russia or Venezuela or Saudi Arabia or Perhaps. In Canada? No. What I'm saying is that it's coming either from Does

[Matt Walker (Chair)]: the oil come from Canada?

[Jared Duval (Executive Director, Energy Action Network)]: Some does. Some does. But I'm saying all of our electricity comes from either New England, New York, or Canada. So it's staying far more local in Vermont and far far more regionally local than our fossil fuel spending. And then the last thing that I think is really important to talk about when it relates to the different types of transportation is the pollution that then results. And so oftentimes, electric vehicles are talked about as producing zero tailpipe pollution, which is true. But, of course, there is emissions related to the electricity generated to power EVs. And so we look at life cycle greenhouse gas emissions, recognizing that there are emissions in the production of electric vehicles and the batteries that power them. But when you do that, you see that over the lifetime, an electric vehicle is seven times less polluting than a gas vehicle. So in summary, our analysis of Vermont's energy economy and is is that we are heavily reliant on fossil fuel and that fossil fuels have four key features. They are expensive. They are price volatile. They drain money out of state, and they are heavily polluting. But what we spend on transportation is not the same for each household and what the burden that those expenses create in household budget are very different by household type and income. So this graph looks at average annual transportation expenditures by household broken down by income group. And what we see is that folks who have households with lower income spend much less on transportation than households with upper income. We see that in the blue bars. So households at over a $150,000 a year spend on average over $23,000 a year on transportation. They have more vehicles. They travel more miles. And it's not just so, you know, that that leads to that. And lower and middle income Vermonters travel less and spend less on transportation, but it takes up a far larger share of the household budgets of lower and middle income Vermonters. As you can see in the orange bars, which shows the share that that transportation spending takes up of the household budget. So there you know, you you kinda see this x, and there's a reverse relationship here where upper income folks spend a lot more, but it takes up far less of their household income and presents much less of a burden for them than it does for lower income households. And where those this gets back to representative White's question, which is when we look at total spending on transportation, what goes to what? And again, this varies by household. When we look at the wealthiest households in Vermont, nearly half of transportation spending on purchasing vehicles, as we see in the green here. But for the lowest income Vermonters, about a third of total transportation spending goes to fuel, and it goes to maintenance and repairs. So if we wanna be able to reduce transportation cost burdens for lower and middle income Vermonters, focusing on the cost of fuel and the cost of maintenance are two key strategies that can help reduce those costs.

[Matt Walker (Chair)]: Does that factor in like the light EP assistance that low income Vermonters get just because the people on the continent to offset that 23% or whatever that you know, whatever they wanted us.

[Jared Duval (Executive Director, Energy Action Network)]: This just looks at the transportation side. It doesn't look at the heating.

[Matt Walker (Chair)]: Oh, doesn't look at the, oh, just transfer. Oh, okay. Yeah.

[Jared Duval (Executive Director, Energy Action Network)]: We do have other graphs that look at the heating side, but I limited it to the transportations This is a graph that looks at the prices of different transportation fuels over time. And, again, what we see is significant price volatility with relation to gasoline and diesel. These numbers go through June 2025, which was the latest available when we published this report. In comparison, we see the equivalent costs of electricity to power an electric vehicle in green at the bottom. The light green line being the average residential electric rate in the state, And the dark green being this dedicated EV rates that some utilities have developed showing Green Mountain Power there in on the top in Burlington Electric Department, which has the lowest EV rate in the state at the equivalent of only 71¢ a gallon. And then the I'm sorry.

[Phil Pouech (Ranking Member)]: So I get you wanna go back to graph. I totally get that graph. What may not be in there, and I'm sure it's a small amount, but occasionally people with electric vehicles have to go up to public charges. Yes. And that can sometimes be a significant norm and really close that gap. And for those that rely just on public chargers and what we call sort of the wild wild west out there with public chargers, it does bring that up a little bit more. So I would say, those that are able to charge at home, there's exactly what the price is.

[Jared Duval (Executive Director, Energy Action Network)]: Yeah, these are the rates if you're doing of at home charging, at work charging, if you're going to, there is some significant variation in kind of public level two or public level three charging, DC fast charging is often much more expensive than level two charging. But even you know, across those, there can be different rates and that can affect this. But for most folks, I would have to double check to be 100% certain about this. But I believe the last survey I saw showed that over 90% of charging is done at home. And so it tends to be on the margins and more for road trips and things like that that folks are charging at home or at work. This gets back to the previous point that, you know, it's not like three quarters of the money we spend on all fossil fuels leave the state and only a quarter recirculates locally. That's the average across our first fossil fuel spending. But different fuel types keep more or less money locally, depending on how much local labor goes into it, how much local infrastructure goes into it. So, you know, when we spend a dollar on gasoline, more money leaves the state than a dollar spent on diesel, for instance. And, this reflects the difference between the wholesale and the retail price of those those fuels. But, again, electricity, nearly 60% of the dollars we spend on them stay and recirculate in the Vermont. I wanna pass here. I've I've shared a lot of data, a lot of graphs. I want to do something a little out of the ordinary for a data and research based organization, but that is to read from a work of fiction, because I think there is an excerpt from a book that I came across in the last year that I think really illustrates the dynamic that is at play and the challenge that we face when it comes to energy and transportation affordability. This is an excerpt from the book Men at Arms by the author Terry Pratchett. This is the character Sam Grimes speaking. He said, The reason that the rich were so rich was because they managed to spend less money. Take boots, for example. He earned $38 a month plus allowances. A really good pair of leather boots cost $50, but an affordable pair of boots, which were sort of okay for a season or two and then leaked like hell when the cardboard gave out, cost about $10. Those were the kinds of boots Vimes always bought and wore until the soles were so thin that he could tell where he was on a foggy night by the feel of the cobbles. But the thing was that good boots lasted for years. A man who could afford $50 had a pair of boots that it'd still be keeping his feet dry in ten years' time, while the poor man who could only afford cheap boots would have spent a $100 on boots in the same time and would still have wet feet. I think what we see when it comes to housing, when it comes to heating, when it comes to transportation is the same dynamic. Oftentimes, folks cannot afford a more efficient option that is gonna save them a significant amount of money over time. And when you get stuck having to purchase a used inefficient vehicle that costs more to fuel and more to maintain, you're spending much more month to month and year to year than you would over the life of a vehicle if you were able to afford that upfront investment to get into a more efficient vehicle that costs less to fuel and that costs less to maintain. So that's what I want to look at with you now, is some of the key differences between electric vehicles and gas vehicles when it comes to cost of driving, cost of fueling and maintenance. This is perhaps the most important slide I'm going to share with you today because I think that this is something that is not nearly as well understood as it should be. And it gets to basic understanding energy and the physics involved with energy production and use. Internal combustion, which is how fossil fuel vehicles, gasoline or diesel vehicles work, is an inherently inefficient process. You're burning fuel to to run an engine and some of that some of that fuel gets some of that energy gets delivered to the wheels and moves the vehicle. But the process of combustion is incredibly inefficient. Most of that energy is actually lost to heat and other engine losses. So, when you burn a gallon of gasoline, only about 16 to 25% of the energy content of that fuel moves the vehicle. In contrast with an electric vehicle, electric motors are much more efficient. They don't rely on combustion. They don't have the heat loss that internal combustion engine vehicles do. They also have regenerative braking. And so what you see is that 87 to 91% of the energy that you put into an electric vehicle gets delivered to the wheels and moves the vehicle. So electric vehicles are about four times more efficient. And what what do I mean by that? You you put a dollar into a gasoline vehicle. On average, it moves you seven miles. If you put a dollar into an electric vehicle and you have access Vermonters the largest number of Vermonters are Green Mountain Power customers. They have access to EV rates, and that same dollar would move you 21 miles. We'll see if I have don't have that slide. But when a vehicle is four times more efficient, it means that you can then spend much less money on that vehicle to go the same number of miles.

[Chris Keyser (Member)]: Representative Keyser? Thank you for this. Are you suggesting that the generation of electricity is a 100%?

[Jared Duval (Executive Director, Energy Action Network)]: Is a 100% what? I'm sorry. Efficient? Efficient. No. There are- But what's

[Chris Keyser (Member)]: the efficiency of electric generation?

[Jared Duval (Executive Director, Energy Action Network)]: It varies. Are efficiency losses in both electricity generation and in fossil fuel production.

[Chris Keyser (Member)]: I asked about electricity. What is the efficiency of a large generation plant?

[Jared Duval (Executive Director, Energy Action Network)]: It depends on what the generating source is. Thank you. There's very different efficiencies depending on if it is gas generation, coal generation, wind generation, solar generation, nuclear generation. I can get back to you with the specifics on that, but it matters by generation type.

[Chris Keyser (Member)]: So what we know is that generation of electricity for distribution is not 100% efficient.

[Jared Duval (Executive Director, Energy Action Network)]: That's true. That's also true of fossil fuel production.

[Chris Keyser (Member)]: Just talk about electricity. Representative

[Matt Walker (Chair)]: Wells?

[Kenneth "Ken" Wells (Member)]: Yeah. And are you factoring in after 40 degrees out there, those electric cars are so inefficient. Sometimes when it gets really cold, you gotta choose between a heater. And how many miles

[Jared Duval (Executive Director, Energy Action Network)]: do you drive? Yeah. So these are average efficiencies, and it's absolutely true that at at warmer temperatures, electric vehicles are even more efficient and at colder temperatures, they become less efficient. And there's also considerable variation across models, even. So there are some EVs that lose much less range in cold weather than other EVs. It tends to be the ones that have heat pumps in them to keep the the battery warm or that have well insulated batteries. But, you know, we see a range of you know, some electric vehicles only lose 25% of their range in cold weather. Others will lose up to 40% of their range in cold weather because of the differences in insulation. And I can share that with the committee. There's been some really good research on that. But what I was presenting was average of average efficiencies.

[Kenneth "Ken" Wells (Member)]: I would say that until those inefficiencies are cured, those electric vehicles will never be bought by the masses to the levels they project. But I imagine eventually, they will improve on this as America. We're gonna make a better product as time go by.

[Jared Duval (Executive Director, Energy Action Network)]: Yeah. And a and a number of them are great. I have been very happy with my Nissan LEAF that I had for six years and and the efficiency of of that vehicle, which saved me a lot of money. Paid less than $200 a month to lease it and saved a ton of money on on fuel because of how efficient it was. And and there are a number of vehicles that can do that for providers for those who want.

[Unidentified Committee Member]: Representative Cole? Are you gonna give us a list of, like, the most efficient one?

[Kenneth "Ken" Wells (Member)]: I'm happy to do that. Yeah. I

[Matt Walker (Chair)]: don't know how it helps the efficiency, but I definitely let my gasoline power warm up longer in the cold than I do when it's warm. It's the opposite in the South, though. It turns on when it's hot out much sooner. So

[Jared Duval (Executive Director, Energy Action Network)]: I want to get back, if it's okay, to this boots analogy, which is the difference in upfront cost versus overtime cost. And you can see that in this chart, without incentives, the upfront and so what we wanna do is an apples to apples comparison. So what we chose here is is two models that or a model that has both a gas and an electric version. So this looks at a 2025 Chevy Equinox gas vehicle on the left, a 2025 Chevy Equinox EV on the right. And you can see that the MSRP, the upfront sticker price of the Equinox EV without any incentives is about $5,000 higher. I should note that this is a very conservative analysis because there are still, while the federal incentives are gone, the state incentives are utility incentives in Vermont that can bring down that upfront purchase cost. That's important. Oftentimes when we talk about affordability, it's just that. It's what is the price of the vehicle? Of course, that matters. If you don't have the money up front, you can't. You just can't do it. But we also need to look at what is the cost of operations and maintenance, which is the purple, and what is the fuel cost, which is the orange. That's where EVs have a major advantage over gas vehicles. And it relates back to the efficiency of of operation. On average, this has been estimated by Consumer Reports. AAA has also done your a a study called Your Driving Costs. And the consistent finding is that EVs on average cost about $10,000 less to fuel and maintain over their lifetime than gas vehicles. And so even though you're talking about without incentives, EVs costing more upfront, at the end of that vehicle's lifetime, you're talking about $5,000 less in costs in the EV than you would have had with the gas vehicle.

[Unidentified Committee Member]: Representative. So I see it on the side there. Total lifetime cost, twelve years. How long does an average, I guess, does a battery last in electric vehicle? Will it last 12 layers? It stop

[Jared Duval (Executive Director, Energy Action Network)]: the Yeah, me just I have a note on this, but I think I have to stop share on my screen to access it. My apologies. Let me just I want to make sure I get the right note. Okay. So about EV batteries, EV batteries are typically covered by warranties for eight to ten years or a 100,000 to a 150,000 miles, whichever comes first. Current data indicates that many EV batteries will last the life of the vehicle and never need replacing. So the most recent analysis I've seen is from Recurrent, a company that analyzes EV battery data. And they found that for EVs built in 2016 or later, less than 1% chance that the battery will need to be replaced over the lifetime of of the car. So there is information about out there in terms of battery life that raises understandable and legitimate concerns that primarily resulted from the first generation of electric vehicles when the battery technology was not as good as it is now and since 2016 in particular. In Vermont, the same thing is true of gas vehicles as it is electric vehicles when it comes to vehicle lifetime, which is, for most cars, the first thing that's gonna end its life is rusting out from the body. -The you know sound. Right. Yeah.

[Unidentified Committee Member]: So what would you consider? Does this recurrent say what the lifetime of a car is? Is it twelve years? Electric vehicle, is it twelve years? Is it fifteen years? What is the lifespan of an electric vehicle? So

[Jared Duval (Executive Director, Energy Action Network)]: what we did in this analysis was use data from the I wanna make sure I'm getting this correct. I'm pretty sure that this for vehicle lifetime, we use the average that the Public Service Department uses in their technical reference manual, which was twelve years.

[Unidentified Committee Member]: Twelve years.

[Jared Duval (Executive Director, Energy Action Network)]: Okay. Some some last longer. And and that's both for gas and electric vehicles. But on

[Unidentified Committee Member]: the side of that slide. Yeah. Totally.

[Jared Duval (Executive Director, Energy Action Network)]: And what we see with electric vehicle batteries is is it's very rare for them to just not work and need to be replaced. What we see is a gradual degradation each year of, you know, one to 2% of range. So what you might see is, you know, if if if your vehicle started out with 275 miles of range, you know, it might go down to 240 miles of range after

[Unidentified Committee Member]: Yeah. We can do that.

[Matt Walker (Chair)]: Yeah. Great.

[Jared Duval (Executive Director, Energy Action Network)]: Let me just go back and

[Matt Walker (Chair)]: Not a question, but if

[Phil Pouech (Ranking Member)]: we Google average, this is from Central Vermont Auto Mart, average life expectancy is nine point nine years, primarily due to corrosion. Doesn't talk about electric versus, and but basically say it's ten to fifteen years. You know, like, you can hope to get.

[Matt Walker (Chair)]: Think it's interesting. Mostly corrosion. We we've heard from previous testimony that the average Vermonter that pulls on to their life of an average Vermont car is eight years. It's a facility that lasts about eight and a half years, it's been the same. The average ownership of a Vermont car is eight years.

[Jared Duval (Executive Director, Energy Action Network)]: Interesting.

[Matt Walker (Chair)]: We all know they're gonna rust out before they Yeah. Yeah.

[Unidentified Committee Member]: I try both. I trust aluminum. Stainless steel, whatever the whole thing is. What's that? That's stainless steel. Right? Put that truck. What is it called? A cyber truck? That's the cyber truck. That's all stainless steel. Well, that's my understanding. So a bunch

[Matt Walker (Chair)]: of scenarios on that, a bunch of household. So

[Jared Duval (Executive Director, Energy Action Network)]: then I think I only have one I think I only have a couple more slides for you, but just to bring this down again to a household level, what is a Vermonter facing? At, you know, the average gasoline price when we did this report, which is $3.24 a gallon, it's down a bit. Since then, it's more closer to $3 a gallon now. But what that adds up to with average vehicle annual vehicle miles traveled and average efficiency of gas vehicles in Vermont. That's about $1,500 a year just spent on gasoline. If you take the same number of miles driven in an electric vehicle, this is what the annual fueling costs end up at different electricity rates. So here's the Vermont average residential rate. This isn't an EV rate. This is just if you plug it into the wall and you're you haven't signed up for an EV rate with GMP or BED or any other utility. The the low residential rate in Vermont is here. The high is here. And then you see the EV rates here. So there's a lot of information here, but the takeaway is the same, is that even at the highest residential electric rate without even using an EV rate costs half as much to fuel an electric vehicle in a year than it it does a gas vehicle. And representative White, please.

[Candice White (Member)]: Yeah. So, Gerard, have you been in on the conversation about the Miles per hour user fee?

[Jared Duval (Executive Director, Energy Action Network)]: I'm aware of it. I've been following it in the news. I should have said at the very beginning that Energy Action Network, we do not do any lobbying. We don't take any positions for or against bills. We're a research and data tracking organization. So this is here to help inform conversations, but I can't take a position on any bills before the committee or the legislature.

[Candice White (Member)]: And I wasn't asking for your opinion, but just was curious if you've been paying attention to I think we had some proposals in here a couple weeks

[Unidentified Committee Member]: ago from

[Candice White (Member)]: UVM recommending what they would charge per mile driven for an EV, as we are trying to figure out how to shore up transportation revenue and have EVs pay basically a road user fee, which right now we're not really paying much at once, it's really nice cost savings. But I'm just wondering how that mileage based user fee would factor into looking at costs over time, because that's obviously going to be adding costs to EV ownership.

[Jared Duval (Executive Director, Energy Action Network)]: Yeah. Going back to this slide, there's this slice in gray, which is the EV infrastructure registration fee that was added on EVs, which increases the lifetime operations costs and decreases the savings for an EV from about nearly 6,000 to nearly 5,000. What I would say is that let me see if I have this chart. I do. I don't have it. I apologize. I don't I have a version of this. It has gasoline and diesel that I can follow-up with the committee to send. But I think something that is important to look at is the total taxes and fees that we put on different energy sources in Vermont. And when you add it all up, the the most taxed and feed energy source in Vermont is electricity. That is out of step with oftentimes in tax policy, there is this idea called the polluter pays principle, where you want the less the the the fuels that are creating less cost for society to pay less in taxes and fees. What we see in Vermont is a reverse relationship where the the the lowest polluting, the least costly in terms of the costs to society, in terms of health and infrastructure damage, you know, is is electricity. But the cumulative taxes and fees that we're putting on electricity is is much more than on the much higher polluting fuels. And I do have a version of this where it includes gasoline and diesel, which are higher, you know, than the point seven and point eight you see for propane and fuel oil because of the because of the gas tax, which, you know, propane and fuel oil are just paying a $2.02 cent gross receipts tax.

[Phil Pouech (Ranking Member)]: Representative Pouech? Yeah. I'm back to that slide 22. I'm glad you put on that infrastructure fee because that is part of the amount, that little gray bar and roughly the mileage based user fee that would be proposed is about double. So the know, the infrastructure fee would go away and this very thin thing would get a little bit bigger. But it kind of puts it in perspective.

[Jared Duval (Executive Director, Energy Action Network)]: And then the the last thing I wanted to share with you all is just how much the which I'm sure you're aware of, but how much the incentive environment has changed in the last year. So for somebody who was looking at getting a used electric vehicle in 2024, these were the incentives that were available to help address that boots challenge. Right? Bring down the upfront costs so you can save money month after month, year after year, and over the lifetime. There's a federal tax credit. There's a utility rebate. There was the Mileage Smart program. There was the Replace Your Ride program. Now, a year later, the only one of those that continues are the electric utility rebates. We don't have the federal tax credit for EVs. We don't have the Mileage Smart program. We don't have replace your ride. And so upper income Vermonters, wealthier Vermonters are still able to purchase electric vehicles and benefit from the lower costs of, fuel and maintenance over time. But the folks who are gonna miss out on the ability to get into a vehicle that costs less to drive over the lifetime are the folks who will not be able to afford new or used EVs without those incentives that previously existed. And so I'm worried that we're going to see an increasing divergence between the folks who have the highest energy cost burdens, the highest transportation cost burdens, who would most benefit from getting into EVs, and the folks who can at least afford their current fuel and maintenance costs. With this changed incentive environment, it's gonna really limit access. And you can see that the result of the state programs. This is looking just at the state EV incentives that were issued from 2020 to 2025. You set a low income incentive that was higher than for middle income folks, But you limited the incentives to only low and moderate income folks. If you made more than $100,000 you weren't getting an EV incentive. And if you were buying a luxury vehicle, you were not getting an EV incentive. And so what it meant was that 62% of the state EV incentives went to low income households. That's just the number of incentives. But because those dollar amounts for those incentives were higher, about 80% of the state of Vermont's incentive dollars went to help lower income Vermonters get into used or new electric vehicles and lower their transportation costs.

[Matt Walker (Chair)]: Representative Burke, we're a little over time.

[Candice White (Member)]: I just wanna comment that, you know, it's it's been to my mind when it's so exciting when we had those incentives going, particularly the program, which was really a new program. It's getting to my, just something that I've been very upset about, losing the capacity, because we really were making certification more affordable for very long term people. I even proposed a bill this year and knowing that there was no money, the Fed wanted to put the most part program in there just to sort of keep that idea alive. Mean, someday we can return to it.

[Phil Pouech (Ranking Member)]: Just sort of piggyback on that. You know, I'm a proponent of electric vehicles for a number of reasons. And one of them was cost, that's not the only one. I mean, but I think what you're you know, you've shown us that even if we helped very low income Vermonters buy a newer high bay car, a newer car, they're saving with the lawn. They might save more in electric, but just the fact that at a certain income level, you're stuck buying old, you know, cars that require repairs. And so you're stuck at a higher per year cost for the same miles. So while electric may go a little bit farther, you know, anything done to help the lower income, not only for vehicles, but I guess you would say in their next boiler, their

[Jared Duval (Executive Director, Energy Action Network)]: next Weatherization.

[Phil Pouech (Ranking Member)]: Yeah. Any of those things. I didn't save money in the long run.

[Matt Walker (Chair)]: I thought you were gonna save boots.

[Unidentified Committee Member]: That's the

[Phil Pouech (Ranking Member)]: analogy. Right? Thank

[Matt Walker (Chair)]: you very much for coming in this afternoon. We appreciate you staying a little over the time. We will be adjourned till two