Clean Cars Yields $95 Billion in Benefits for Coloradans

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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 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% new ZEV sales in MY 2027 and eventually 100% 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:

• 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.
• 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.
• 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.
• 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 & 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.

By Yeh-Tang Huang, Schneider Sustainable Energy Fellow, Climate & Clean Energy Program, Courtesy of NRDC (Natural Resources Defense Council)

This blog has been co-authored by Alison Kirsch from the Sierra Club and Aaron Kressig from Western Resource Advocates.

Full NRDC press release:

Report: Colorado Clean Cars Plan Can Save Drivers Millions & Deliver Major Jobs, Health, & Climate Benefits

Coloradans — who frequently endure unhealthy air pollution largely from gasoline-burning vehicles — stand to receive major jobs, health, and energy savings benefits if the state adopts a strong Colorado Clean Cars plan that would speed up the transition to zero-emissions electric cars and light-duty trucks, a new report shows.

“The Benefits of the Colorado Clean Car Standard” report released today finds that the total benefits for Colorado would be as much as $95 billion in 2050 from public health and climate improvements, savings to drivers of zero emissions vehicles, and utility customer savings — under a Colorado Clean Cars program, also known as Advanced Clean Cars II, if adopted through 2035.

State officials will hold a public listening session on May 20 on the state’s proposed clean car standard, now set to run only through 2032. ERM prepared the report for NRDC (Natural Resources Defense Council), the Sierra Club, and Western Resources Advocates (WRA) to show the full benefits available through 2035. Vehicle pollution harms public health statewide but impacts low-income and communities of color living near transportation corridors the most.

“Coloradans are poised to breathe easier, find new jobs, and be able to buy cleaner vehicles if state leaders push the pedal to the floor on the Colorado Clean Cars program,” said Kathy Harris, Clean Vehicles and Fuels Advocate at NRDC. “By adopting the clean cars plan through 2035, the report shows Colorado would receive substantial benefits—including from improved public health, savings for vehicle owners and less polluted air—while addressing the climate crisis and rising energy costs impacting people across the Rocky Mountain state.”

“Colorado has an important opportunity to act on climate, improve air quality, and provide economic benefits to communities by adopting this program to put cleaner cars on roads. Let’s get moving to slash pollution from transportation,” said Sierra Club Colorado Lead Organizer Sarah Clark.

“Bold action from our leaders is required to meet the dual crises of climate change and poor air quality,” said Aaron Kressig, transportation electrification manager at WRA. “Colorado took an important step forward in April by unanimously adopting Advanced Clean Trucks (ACT) and Low-NOx rules, which will increase the number of zero-emission trucks and buses available from manufacturers. Colorado should continue this momentum and adopt the strongest Clean Cars standard this year. As this new report illustrates, the benefits of a rapid transition to zero-emission vehicles to all Coloradans are clear, and we urge state officials to put Colorado on the right track – one which will bring emissions from the passenger vehicle sector down to nearly zero by 2050.”

“The Benefits of the Colorado Clean Car Standard” report outlines three scenarios for how manufacturers might meet requirements if the state adopts Colorado as Colorado Clean Cars – through 2035. The report finds that by 2050:

• Coloradans will avoid up to 236 premature deaths and 225 hospital visits from breathing polluted air, for a total of $2.6 billion to $2.9 billion in health benefits;
• Up to 221 million metric tons of greenhouse gas emissions, 70,820 metric tons of NOx, and 6,230 metric tons of particulate matter will be reduced throughout Colorado;
• More than 4,990 jobs will be created, many in well-paying positions in electrical component manufacturing and charging infrastructure construction;
• Colorado urban and rural drivers of zero emissions vehicles will save between $6,000 and $19,000 in lifetime vehicle costs depending on the year the vehicle is purchased;
• The average Colorado household will save up to $153 and the average commercial customer saves up to $959 on electricity bills;
• Colorado will gain cumulative net societal benefits (the sum of public health and climate benefits, net cost savings for vehicle owners, and net utility costs from increased electricity demand for electric vehicle charging) of up to $95 billion.

The Colorado Clean Cars program will require vehicle manufacturers to increase sales of light-duty zero emission vehicles (ZEV) in Colorado. If it is adopted through model year 2035, it could require 100 percent of new ZEV sales by 2035. The Colorado Department of Public Health and Environment is currently holding stakeholder meetings about the Colorado Clean Cars program and has announced its intent to propose the rule in July and hold a rulemaking hearing in October.

In addition, the federal Inflation Reduction Act signed into law last year will help people buy a zero emissions electric vehicle, with discounts up to $7,500 for new EVs and $4,000 for used EVs.

In Colorado, there currently are 3.5 million light-duty vehicles –vehicles weighing under 8,000 pounds including passenger cars, SUVs, crossovers, and pickup trucks—that travel more than 51 billion miles a year and burn more than 2.2 billion gallonsof gasoline, the report shows.

Emissions from internal combustion engines contribute to air pollution and climate change. Because the nation’s light-duty fleet is projected to grow 59% by 2050, the problem will grow much worse, so we must shift now to zero emissions vehicles.

Nationally, light-duty vehicles account for about 90% of all on-road vehicle miles traveled and emit about 67% of total greenhouse gas emissions annually from the on-road vehicle fleet. Light-duty vehicles also account for 33% of the nitrogen oxide (NOx) and 30% of the particulate matter emitted by on-road vehicles.

Together, these pollutants worsen air quality and harm public health in many urban areas, including in low-income and communities of color often disproportionately affected by emissions from nearby transportation infrastructure.

“The Benefits of the Colorado Clean Car Standard” report is here.

A blog about the report, co-authored by NRDC, WRA, and the Sierra Club, is here.

Courtesy of NRDC (Natural Resources Defense Council), an international nonprofit environmental organization with more than 3 million members and online activists. Established in 1970, NRDC uses science, policy, law, and people power to confront the climate crisis, protect public health, and safeguard nature. NRDC has offices in New York City, Washington, D.C., Los Angeles, San Francisco, Chicago, Bozeman, MT, Beijing and Delhi (an office of NRDC India Pvt. Ltd). Visit us at www.nrdc.org and follow us on Twitter @NRDC.