Dive Brief:

• New federal funding to support electric vehicle (EV) charging is unlikely to materialize for project developers until the fourth quarter of 2022, EVgo Chief Commercial Officer Jonathan Levy said Tuesday at Politico's Sustainability Summit.
• The $1.2 trillion infrastructure package signed Monday by President Joe Biden includes $7.5 billion to build charging stations and $5 billion for transit agencies and school districts to go electric. But it will take up to a year for funding to move from the federal government to state agencies, which is "why it's so important to have the reconciliation bill pass as well," Levy said.
• The Build Back Better reconciliation package currently being debated includes more than $100 billion in tax credits to make vehicles more affordable, along with direct pay provisions for infrastructure that could be accessed immediately. It also has additional credits for union-made EVs, which have drawn wide-ranging criticism and now appear to be at risk of being cut.

Dive Insight:

Building out EV charging infrastructure will require the private sector, local leadership and the federal government all to work together, which is one reason EV funding in the infrastructure bill has been structured as cost-shared grants, said Levy.

"That's a good thing, but that process also means that it's going to take some amount of time," he said. "There's a lot of steps in between, including public comment periods ... which is why the tax credits from the consumer side in the reconciliation bill are so important. Because we have to have the cars using the charging that's built out there."

The purchase credits in the reconciliation bill could reduce the sticker price of a new electric vehicle or truck, depending on where and how it is produced, by up to $12,500. Used EV buyers could get up to $4,000 back.

While there appears to be widespread support for EV purchasing credits, there is also debate over whether these should favor unionized automakers. Biden's proposal contains a $4,500 credit for vehicles assembled with union labor, which includes those made at U.S. facilities belonging to General Motors, Ford and Stellantis (formerly Chrysler). 

Tesla, Toyota, Honda and others who operate nonunion EV factories — which are not unionized — have criticized the approach, as have some Republican lawmakers and governors as well as international parties.

Sen. Joe Manchin, a moderate Democrat from West Virginia, last week called the union credits "wrong" in an interview with Automotive News. They are "not how we built this country, and the product should speak for itself," he said.

But every country helps its own workers, Rep. Debbie Dingell, D-Mich., said at Tuesday's sustainability summit, and the pro-union provisions will help bring manufacturing back to the United States.

"These are incentives that are going to both help the consumer and are going to help the American worker," Dingell said.

It is "not at all clear" if the pro-union provisions will make it into a final version of the bill, according to California Energy Commission Chair David Hochschild, who also spoke at the Politico event. The proposal "is a highly contested one."

Regardless of how the credits are structured, Hochschild said electric vehicle manufacturing "is going to be a major opportunity for the whole country." EVs are now California's largest export.

"The bigger picture is that these provisions as a whole can reverse decades of offshoring in the auto manufacturing sector," BlueGreen Alliance Executive Director Jason Walsh said. "They can fill critical supply chain gaps with products made in America and ensure that workers and communities across the country see economic gains from this historic shift to EVs."

The EV space is growing, however, and non-unionized automakers say they need support.

"Being able to have our customers take advantage of that tax credit ... is critically important in these first couple of years," said Lucid Motors Head of Global Public Policy Jessica Nigro.

"We think that any vehicle made in the U.S. by American workers should be treated the same. Honestly, what we're telling workers who are not unionized is that their work is valued less than workers who are unionized," Nigro said.