Last Tuesday’s election results were earthshaking. The Republican Party picked up more than 60 seats in the U.S. House of Representatives, the largest single party turnover in 70 years. Given that the last two years have seen an unprecedented level of federal funding and support for advanced batteries and electric vehicles, it is reasonable to ask: what are the implications of the election for the U.S. advanced battery industry?
The answer is probably: not many. This is true for a number of reasons. First and most encouragingly is the fact that, notwithstanding the philosophical differences between Democrats and Republicans, the desirability of vehicle electrification is one of the few issue on which they can agree. We will probably be talking a bit less over the next two years about the greenhouse gas benefits of electric cars. But the need to reduce reliance on imported petroleum, the need to create jobs and commercial opportunities for Americans in clean energy, and the need to reduce the national trade deficit are all messages that will continue to resonate on both sides of the isle.
The second reason the election results will likely not matter is because the federal government’s historic financial support for advanced batteries and electric vehicles over the past two years has always been a one-time deal. The $2.4 billion of DOE grants to support advanced battery manufacturing and the electric drive supply chain was not funded by something called the Battery Package; it was funded by the Stimulus Package. That is an important distinction. Once the Stimulus Package funds were expended and the economy began to recover, there was never any realistic expectation that anything close to that level of funding for battery manufacturing was going to continue. Industry was going to have to become self-reliant and the business of advanced batteries self-sustaining. The outcome of the election changed nothing.
Finally, but perhaps most disturbingly, the election results will likely do nothing to relieve the legislative gridlock that has hamstrung Congress for the past year. It was once the case that Washington closed down for about a year prior to elections. But there would follow after the election about a year of serious governance before the political cycle started up again. Unfortunately, recent statements by political leaders indicate that after this election we may not get the usual one year good governance hiatus. The gridlock of the last year may simply continue, forestalling progress even on issues as to which there is general agreement. More of the same.
The important lesson from the last election for the advanced battery industry is that it cannot look to Washington alone to build a market for advanced batteries. The election results indicate no change from before, only an exclamation mark.
For the past year, NAATBatt has been suggesting that its members look to other power centers for the leadership necessary to grow a market for advanced batteries and electric vehicles in the United States. Although Washington may be gridlocked, most state and local governments are not. State public utility commissions in particular, with their jurisdiction over electricity generation and distribution, are natural places to look for that leadership. Although long derided as a fragmented and anachronistic way of regulating a national electricity system, the very fact that the public utility commission system is not involved in or hampered by the dysfunctional culture of Washington means that PUC’s may well have the ability to shape and perhaps even to lead the policy debate about vehicle electrification over the next two years.
I would be remiss if I did not point out that the upcoming NAATBatt conference on December 8-10, 2010 will focus heavily on how PUC’s are thinking about the relationship between plug-in electric vehicles and the grid. Chairman Isiogu of Michigan, Vice Chairman Gardner of Kentucky, Commissioner Centolalla of Ohio and Dan Cleverdon of the District of Columbia are some of the leading thinkers in the PUC world about the role that PUC’s and electric utilities will need to play in the evolution of the national vehicle fleet to electric power. If you want to understand where our industry is going and where the opportunities are likely to be over the next few years, you should not miss this program.