Water conservation

California offers $ 6.1 billion for electric vehicle initiatives

California Governor Gavin Newsom holds a copy of the California state budget after he officially signed it at a rally in Los Angeles on Tuesday, July 13, 2021.

Hans Gutknecht | MediaNews Group | Getty Images

California Governor Gavin Newsom presented a $ 286.4 billion budget proposal, dubbed the “Californian plan,for the state on Monday. The plan suggests spending $ 22.5 billion to deal with the state’s emerging climate crisis, allocating $ 6.1 billion to initiatives related to electric vehicles.

Last year, the state of California pledged $ 15.1 billion on a range of climate-related efforts, including $ 3.9 billion for electric vehicle initiatives. California also became the first state to declare that it would effectively ban the sale of new vehicles with internal combustion engines or gasoline by 2035.

Speaking about how much he plans to spend on electric vehicle incentives, Newsom said, “You’d think we were announcing for the United States government.” Adding $ 6.1 billion in electric vehicle spending to last year’s budget would amount to a “sub-state commitment of $ 10 billion,” he boasted.

The governor said such aggressive spending was justified, in part, to counter greenhouse gas emissions from vehicle exhaust pipes and fossil fuel extraction. The transportation sector is responsible for more than 50% of the state’s greenhouse gas emissions.

The willingness to spend on electrification has attracted new zero-emission vehicle companies to the state, the governor said without naming the companies. They include automakers like Rivian and Lordstown Motors, and charging infrastructure players like Volta and Ample, among others in Tesla’s footsteps.

Referring to Tesla, Newsom said, “Even those who historically resided in the state are thriving in the state.” Tesla moved its headquarters to Austin, Texas last year, but maintains a vehicle assembly plant in Fremont and other major operations in California.

Newsom also called California “Saudi Arabia of lithium” in reference to the ore deposits in Imperial County near the Salton Sea.

Climate spending proposals in the California Blueprint for fiscal year 2022-2023 include:

  • $ 3.9 billion for the electrification of ports, heavy trucks, school buses and public transportation in the state.
  • $ 2 billion for a bag of “clean energy” efforts, including decarbonising buildings, long-lasting energy storage and offshore wind development.
  • $ 1.2 billion in new spending on forest health and fire protection. This includes hiring and training more CalFire and others, purchasing more Firehawks (helicopters used in firefighting), spending on house building, remote sensing, grazing, fuel cuts, prescribed burns and reforestation.
  • $ 1.2 billion on 40,000 electric passenger vehicles and 100,000 new charging stations in California by the end of 2023 and $ 1 billion on other zero-emission vehicle initiatives.
  • $ 1 billion in tax credits for companies that develop breakthrough climate technologies or manufacture green energy technologies and offer profit sharing.
  • $ 757 million for state parks and access for all Californians, regardless of income.
  • $ 750 million to fight drought, to “prepare for the long-term realities of a world that is being put back on its feet,” Newsom said. This includes expenses for water conservation and efficiency, groundwater replenishment, and assistance to small farmers in the bowl condition.

A KCBS reporter asked Newsom to comment on a California Public Utilities Commission solar policy plan that would reduce solar incentives in the state and add monthly grid connection charges for solar customers, thereby making solar power more expensive rooftop for California residents.

Newsom said he had just seen this proposal and admitted “We still have a lot of work to do.” Tesla, which owns a solar business, has called on its employees to lobby against the plan, CNBC previously reported.

In addition to climate spending proposals, the California Blueprint is also seeking billions for healthcare, housing and homelessness, public safety, education, and small business support.

The governor said California has a budget surplus of more than $ 45 billion. Some of that money will likely flow back to taxpayers, and if an amendment to the state’s constitution is approved, Newsom said, some of the excess dollars could flow into state reserves.