Energy Crisis in California: Cut your Air Conditioning, charging Electric Vehicles to avoid blackout

Revelations 18:23 ‘For the merchants were the great men of the earth; for by thy sorceries were all nations deceived.’

Important Takeaways:

  • Don’t Charge that Electric Vehicle: California Braces for Energy Shortage Thru Labor Day
  • Due to high temperatures, residents will be asked to conserve electricity during afternoons and evenings, which means refraining from charging electric vehicles, among other uses
  • Hoping to avoid blackouts, the California Independent System Operator, which manages the state’s power grid, warned Tuesday that it probably will issue a series of Flex Alerts over the next several days. Flex Alerts are voluntary calls for conservation during the afternoon and evening hours, when energy use tends to soar. Residents will be asked to turn up their thermostats to 78 degrees or higher, avoid using dishwashers or other large appliances, and hold off on charging their electric vehicles, all during the 4-9 p.m. time frame.

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U.S. EPA finalizes tougher new vehicle emissions requirements

By David Shepardson

WASHINGTON (Reuters) – The Environmental Protection Agency (EPA) on Monday finalized new vehicle emissions requirements through 2026 that reverse former President Donald Trump’s rollback of car pollution cuts and will speed a U.S. shift to more electric vehicles.

EPA Administrator Michael Regan called the tough standards “doable” even as he vowed to quickly move ahead with the next round of requirements. “We are setting robust and rigorous standards that will aggressively reduce the pollution that is harming people and our planet,” Regan said.

In August, President Joe Biden’s administration proposed undoing the Trump-era action easing requirements imposed during the presidency of Barack Obama. The new rule finalized Monday is tougher than EPA’s August proposal or requirements issued by Obama.

If expressed in miles per gallon (mpg) requirements, the EPA rules would result in a fleetwide real-world average of about 40 mpg in 2026, versus 38 mpg under the August proposal and 32 mpg under the Trump rules.

Officials said the EPA as soon as next year could propose still tougher requirements through 2030 or beyond for vehicles.

“We urge the agency to get moving on the strongest possible long-term standards that rapidly accelerate the transition to zero-emission vehicles,” said Sierra Club President Ramon Cruz.

The Democratic administrations of Biden and Obama have pushed for stricter fuel efficiency standards to reduce greenhouse gas emissions and fight climate change. The new rules will result in 3.1 billion tons of avoided CO2 emissions through 2050 and come after many states and environmental groups urged the administration to impose stricter rules.

Biden wants 50% of all new vehicles sold in 2030 to be EV or plug-in hybrid models but has not endorsed California’s plan to phase out new gas-powered light-duty vehicles by 2035.

In March 2020, Trump’s Republican administration rolled back Obama’s standards to require only 1.5% annual increases in efficiency through 2026. Obama had required 5% annual increases.

The new rules take effect in the 2023 model year and require a 28.3% reduction in vehicle emissions through 2026.

The rules will be challenging for automakers to meet, especially for Detroit’s Big Three automakers. General Motors, Ford Motor Co and Chrysler-parent Stellantis NV appeared at an event Monday with Regan announcing the rules.

The Biden administration’s EV plans suffered a setback Sunday when key Democratic Senator Joe Manchin said he would not support a $1.75 trillion domestic investment bill that includes new EV tax credits that would favor Detroit’s Big Three automakers and the United Auto Workers (UAW) union.

UAW President Ray Curry said in an interview he is hopeful that the EV tax credits will ultimately be approved.

A major auto trade association, the Alliance for Automotive Innovation, said the new rules will require a substantial increase in electric vehicle sales and government incentives for consumers to buy those cars.

EPA estimates the vehicle emissions reduction benefits will exceed costs by up to $190 billion and drivers will save between $210 billion and $420 billion through 2050.

EPA estimates the savings from the new rules will outweigh the increase in vehicle costs by about $1,000 over the life of the vehicle.

EPA estimates the final rule will result in 17% of new U.S. vehicles by 2026 as EVs or plug-in hybrids.

The transportation sector is the largest U.S. source of greenhouse emissions.

(Reporting by David Shepardson; Editing by Lisa Shumaker)

Toyota to build new $1.3 billion battery plant in North Carolina

By David Shepardson

WASHINGTON (Reuters) -Toyota Motor Corp announced on Monday it is building a new $1.29 billion battery plant in North Carolina as it moves to expand its hybrid and electric vehicle efforts.

The new plant, at a site in Liberty that will begin production in 2025, will initially be capable of supplying lithium-ion batteries for 800,000 vehicles annually, and will “pave the way” for Toyota’s U.S. production of electric vehicles, said Chris Reynolds, chief administrative officer for Toyota Motor North America.

The investment will be made by a new company called Toyota Battery Manufacturing and is expected to create 1,750 new U.S. jobs.

In October, Toyota said it would establish a new company and build a new U.S. automotive battery plant with Toyota Tsusho, the automaker’s metals trading arm and a unit of the Toyota Group. Toyota will hold a 90% stake in the battery company.

North Carolina said the new plant will initially produce batteries for Toyota’s hybrid vehicles, and intends to produce batteries for EVs long term.

The state will reimburse Toyota for up to $79.1 million over 20 years and if Toyota expands the project to $3 billion it could receive up to an estimated $315 million.

The state approved additional support to help with final site preparations, including $135 million for road and other site improvements. If Toyota expands the project another $185 million in site development funds would become available.

Toyota said the North Carolina plant plans to eventually expand to at least six production lines for up to 1.2 million batteries annually.

The investment is part of Toyota’s October announcement it would invest $3.4 billion (380 billion yen) on U.S. automotive battery development and production through 2030.

The funds are part of the $13.5 billion Toyota announced in September it planned to spend globally by 2030 to develop batteries.

Automakers around the world are investing billions of dollars to ramp up battery and electric vehicle production as they face increasingly stringent environmental regulations.

Toyota has mounted a lobbying campaign to try to convince U.S. lawmakers not to include an additional $4,500 tax incentive for union-made electric vehicles.

In August, U.S. President Joe Biden signed an executive order setting a target to make half of all new vehicles sold in 2030 zero-emissions vehicles.

Biden’s 50% goal and the automakers’ 2030 goals includes battery electric, fuel cell and plug-in hybrid vehicles that also have a gasoline-engine.

(Reporting by David Shepardson; Editing by Marguerita Choy and Alistair Bell)

U.S. Commerce chief makes pitch for chips funding in Michigan

By David Shepardson

TAYLOR, Michigan (Reuters) -U.S. Commerce Secretary Gina Raimondo on Monday made a pitch for Congress to approve $52 billion to expand U.S. semiconductor manufacturing in a visit to Michigan where she heard about auto sector struggles with the ongoing chip supply crisis.

“The reality is Michigan will lose jobs … if we don’t increase our supply of chips,” Raimondo said.

She visited a United Auto Workers local hall near Detroit and met with Michigan politicians, and officials from General Motors Co, Ford Motor and Chrysler-parent Stellantis on the push for funding before the end of December.

Detroit’s Big Three automakers and other global automakers have been forced to cut production and even make some vehicles without features like heated seats or digital speedometers because of the semiconductor shortage.

On Nov. 17, House of Representatives and Senate leaders said they would negotiate seeking final agreement on a bill to boost U.S. technology competitiveness with China and semiconductor manufacturing. The Senate-approved legislation would award $52 billion for semiconductor manufacturing and authorize $190 billion to strengthen U.S. technology and research.

Stellantis executive Marlo Vitous said the company is working hard to get chips to make vehicles. “It is pure grit right now — the fight for the parts that we need.”

UAW President Ray Curry said the chips shortage “at its core … is not to off-shore American jobs. Bring those” semiconductor jobs back to the United States.

Automotive chips demand will continue to rise as automakers shift to electric vehicles, which use twice as many chips as gasoline-powered models. The companies say the crisis will continue at least another year.

Michigan lawmakers cast the issue in geopolitical terms.

“We are not going to let China kick our ass. We are going to kick China’s ass,” Representative Debbie Dingell said at the forum, saying it was crucial for U.S. workers that Congress boost funding for chips.

The Chinese Embassy in Washington did not immediately respond to a request for comment.

“We need the House to pass its version of the CHIPS Act,” Raimondo said at a separate Detroit Economic Club appearance.

“Commerce is pursuing strategies like ‘nearshoring’ and ‘friendshoring,’ so like-minded partners are integrated into our supply chains,” Raimondo added. “As we rebuild our supply chains, we can’t be dependent on foreign countries that don’t share our values for our critical chip components.”

Last week, Samsung Electronics said it had picked Taylor, Texas, as the location for a new $17 billion plant to make advanced chips.

(Reporting by David Shepardson; Editing by Lincoln Feast and Leslie Adler)

Energy from bogs: Estonian scientists use peat to make batteries

By Janis Laizans and Andrius Sytas

TARTU, Estonia (Reuters) – Peat, plentiful in bogs in northern Europe, could be used to make sodium-ion batteries cheaply for use in electric vehicles, scientists at an Estonian university say.

Sodium-ion batteries, which do not contain relatively costly lithium, cobalt or nickel, are one of the new technologies that battery makers are looking at as they seek alternatives to the dominant lithium-ion model.

Scientists at Estonia’s Tartu University say they have found a way to use peat in sodium-ion batteries, which reduces the overall cost, although the technology is still in its infancy.

“Peat is a very cheap raw material – it doesn’t cost anything, really,” says Enn Lust, head of the Institute of Chemistry at the university.

The process includes heating decomposed peat to a high temperature in a furnace for 2-3 hours. The university expects the government to fund a small-scale factory in Estonia to try out the technology.

Distillers in Scotland dry malt over peat fires to flavor whisky, and some northern European countries use peat to fuel factories and households, or as fertilizer.

As bogs are drained to mine peat, they release trapped carbon dioxide, raising environmental concerns. But the Estonian scientists say they are using decomposed peat, a waste product of traditional extraction methods that is usually discarded.

Sodium-ion batteries using peat will need to prove they are commercially viable and can be scaled up, Lukasz Bednarski, a market analyst and the author of a book on batteries, told Reuters.

China’s CATL in July became the first major automotive battery maker to unveil a sodium-ion battery.

“I think that companies will increasingly try to commercialize the sodium-ion battery, especially after the CATL announcement,” said Bednarski.

Less powerful sodium-ion batteries are likely to be used together with lithium-ion technology to bring down the overall cost of a battery pack, he said.

(Reporting by Janis Laizans in Tartu, Andrius Sytas in Vilnius and Supantha Mukherjee in Stockholm; Writing by Andrius Sytas; Editing by Giles Elgood)

GM to open battery cell development center in push to cut EV costs

By Ben Klayman

DETROIT (Reuters) – General Motors Co on Tuesday said it will open a battery cell development center in southeast Michigan to help it drive down the cost and boost the driving range of electric vehicles with lithium ion and solid-state battery cells.

The Wallace Battery Cell Innovation Center, to be located on the No. 1 U.S. automaker’s technical campus in Warren, Michigan, is expected to open in mid-2022 and begin building prototype cells in the fourth quarter, GM said.

“The key to making these vehicles affordable is going to be the cell cost in the battery packs,” Ken Morris, GM’s vice president of electric and self-driving vehicles, said on a conference call with reporters. GM will spend “hundreds of millions” of dollars on the new center, he added.

GM has said it will spend $35 billion through 2025 on EVs and autonomous vehicles, and is expected to outline targets beyond that period at its investor day on Wednesday.

Part of that push is GM’s partnership with LG Energy Solutions, a unit of South Korea’s LG Chem, to develop its Ultium batteries. The companies have announced two joint-ventures battery plants and GM has said it intends to open two more.

GM has targeted eliminating emissions from all light vehicles it sells by 2035.

A key element to making EVs more attractive to consumers is driving down their cost and a big part of that is the batteries. GM has said it wants to have at least 60% lower battery costs in the next generation of Ultium and officials said future products will allow electric driving ranges of 600 miles (965 km) on a single charge.

The new facility, at almost 300,000 square feet (27,900 square meters), will work with the company’s existing materials research and development and battery systems labs in Warren. It will also work with SES, a Massachusetts company with which GM formed a partnership with in March.

The center, named for Bill Wallace, a former executive who played a key role in the development of GM’s advanced battery technology before he died from cancer in 2018, will be capable of building large-format, prototype lithium-metal battery cells, as well as developing silicon and solid-state technologies.

It will also develop new production methods to use in battery plants.

GM rival Ford Motor Co in April said it would invest $185 million to open in late 2022 an EV battery development center.

(Reporting by Ben Klayman in Detroit; editing by Richard Pullin)

Exclusive: U.S. looks to Canada for minerals to build electric vehicles – documents

By Ernest Scheyder and Jeff Lewis

(Reuters) – The U.S. government is working to help American miners and battery makers expand into Canada, part of a strategy to boost regional production of minerals used to make electric vehicles and counter Chinese dominance.

On Thursday, the U.S. Department of Commerce is hosting a closed-door virtual meeting with miners and battery manufacturers to discuss ways to boost Canadian production of EV materials, according to documents seen by Reuters.

The move comes as demand for electrified transportation is set to surge over the next decade.

Conservationists have strongly opposed several large U.S. mining projects, leading officials to look north of the border to Canada and its supply of 13 of the 35 minerals deemed critical for national defense by Washington.

Tesla Inc, Albemarle Corp, Talon Metals Corp and Livent Corp are among the more-than 30 attendees at Thursday’s meeting who will discuss ways Washington can assist U.S. companies expand in Canada and overcome logistical challenges, according to the documents.

The U.S. Department of Commerce did not immediately respond to requests for comment.

The event comes after U.S. President Joe Biden and Canadian Prime Minister Justin Trudeau committed last month to building an EV supply chain between the two countries.

Since Biden’s election, three U.S. mining companies have invested in Canada, where mining accounts for 5% of the country’s gross domestic product, versus roughly 0.9% in the United States.

Canada’s Fortune Minerals Ltd, which is developing a cobalt mine in the Northwest Territories, has also held funding talks with the U.S. Export/Import Bank, its chief executive told Reuters.

“The United States is really taking this seriously,” CEO Robin Goad said.

Lithium-ion batteries are dangerous to transport over long distances, so automakers prefer to have them built near assembly plants. That should aid efforts by Ontario and Quebec to develop their own battery cell plants with both provinces close to U.S. automakers in Michigan and Ohio, industry executives said.

“The border between Canada and the U.S. is inconsequential with respect to EVs and EV minerals,” said Arne Frandsen, CEO of mining investment group Pallinghurst, which is the largest shareholder in Nouveau Monde Graphite Inc, which is building a graphite mine and anode plant in Quebec.

Pallinghurst joined Livent last November to buy the Nemaska lithium project in Quebec, in what will be North America’s largest lithium mine. Both projects are slated to open by 2024 just as automakers launch dozens of new EV models.

“We do see Canada as a natural fit for expansion as the whole battery supply chain is going through a huge self-reckoning about sourcing,” said Livent CEO Paul Graves.

Livent has supply deals with BMW and Tesla.

’51ST STATE’

To be sure, the United States is also trying to boost domestic production of EV metals, which the Biden administration has said is critical.

But Washington is increasingly viewing Canada as a kind of “51st State” for mineral supply purposes and plans to deepen financial and logistical partnerships with the country’s mining sector over time, according to a U.S. government source.

Both countries are members of the Energy Resource Governance Initiative, a pact to share mining experience and resources.

Canadian firms are also able to apply for U.S. government grants under the U.S. Defense Production Act and other U.S. funding programs. There are no U.S. tariffs on Canadian EV battery metals or EV parts.

“You’re beginning to see Canada become an important part of the North American EV supply chain,” said Keith Phillips, CEO of Piedmont Lithium Ltd, which in January bought 20% of Sayona Mining Ltd, a developer of a Quebec lithium project.

Canada’s First Cobalt Corp is building the continent’s only cobalt refinery, part of an effort to wean the EV industry off supplies from the Democratic Republic of Congo, where child labor has been used. Cobalt is used to make battery cathodes.

Adding to the appeal of Canada, some of the country’s mines bill themselves as environmentally friendly and promise to use hydroelectric power to reduce their carbon emissions.

The United States knows “that we are the most-secure and most-resilient source of metal imports for them,” Canadian Natural Resources Minister Seamus O’Regan told Reuters.

Last week, privately-held USA Rare Earth invested in Search Minerals Inc’s rare earths project in Newfoundland in eastern Canada.

While USA Rare Earth already controls a rare earths deposit in Texas, executives said they wanted access to more of the minerals used to make electronics and weapons.

“You can’t just rely on projects in the U.S. for supply,” said Pini Althaus, USA Rare Earth’s CEO. “You have to collaborate with Canada.”

(Reporting by Ernest Scheyder in Houston and Jeff Lewis in Toronto; Editing by Amran Abocar and Marguerita Choy)

Canada’s Trudeau says scope for closer U.S.-Canada integration on EVs, critical mineral supply

By Steve Scherer

OTTAWA (Reuters) – Canada and the United States can collaborate more closely on manufacturing electric vehicles and on supplying critical minerals needed to make batteries for cars and other clean technologies, Prime Minister Justin Trudeau said on Thursday.

“The integration of our economies, of our supply chains … I think gives a real opportunity for us to really take some leaps forward,” Trudeau said in a telephone interview.

After noting that Canada has many of the rare earths minerals needed for car batteries and solar panels, Trudeau said it was important to have “a secure supply from a friend and an ally”.

China has been one of the main suppliers of critical minerals to the United States, and Biden is planning to mandate a review of critical U.S. supply chains with an eye to securing U.S. industrial supplies, Reuters reported earlier this week.

Canada’s mineral wealth “is part of why so many automakers are now looking at setting up their supply chains for zero emission vehicles in Canada,” Trudeau said.

General Motors Co, Ford Motor Co and Stellantis NV have all announced plans to manufacture electric vehicles in Canada in coming years.

“We’ve already seen something like $6 billion worth of investment by auto companies in Canada over the past couple of years into zero-emissions or low-emissions vehicles,” Trudeau said.

“There’s a lot of really great opportunities to be developing partnerships and production facilities not just for the North American market, but for the world,” he added.

(Reporting by Steve Scherer; Editing by Daniel Wallis)

GM hits reverse on Trump effort to bar California emissions rules

By David Shepardson

WASHINGTON (Reuters) – General Motors said on Monday it was reversing course and will no longer back the Trump administration’s effort to bar California from setting its own emissions rules in an ongoing court fight.

GM Chief Executive Mary Barra said in a letter to environmental groups it was “immediately withdrawing from the preemption litigation and inviting other automakers to join us.”

The dramatic rejection of Trump came as GM sought to work with President-elect Joe Biden, who has made boosting electric vehicles (EVs) a top priority. The Detroit automaker has laid out an ambitious strategy to boost EV sales and last week said it will increase spending on EVs and autonomous vehicles by 35% from previous disclosed plans.

The announcement reflects corporate America’s move to engage quickly with the incoming Democratic administration.

Barra said she believes “the ambitious electrification goals of the president-elect, California, and General Motors are aligned, to address climate change by drastically reducing automobile emissions.”

The White House did not immediately comment.

In October 2019, GM joined Toyota Motor Corp, Fiat Chrysler Automobiles NV and other automakers in backing the Trump administration in its bid to bar California from setting its own fuel efficiency rules or zero-emission requirements for vehicles.

California and 22 other states and environmental groups challenged the Trump administration’s determination that federal law bars California from setting stiff tailpipe emission standards and zero-emission vehicle mandates.

Barra was among corporate and labor leaders that met virtually last week with Biden.

Speaking on Monday, Barra said she was “confident that the Biden Administration, California, and the U.S. auto industry, which supports 10.3 million jobs, can collaboratively find the pathway that will deliver an all-electric future.”

The Trump administration in March finalized a rollback of fuel efficiency standards to require 1.5% annual increases in efficiency through 2026, well below the 5% yearly boosts in Obama administration rules it discarded.

Other automakers, such as Ford Motor Co, Honda Motor Co and Volkswagen AG, which announced a deal with California in 2019 on emissions requirements that was finalized in August, did not intervene on the administration’s side in the California fight.

Toyota said Monday that “given the changing circumstances, we are assessing the situation, but remain committed to our goal of a consistent, unitary set of fuel economy standards applicable in all 50 states.”

Other automakers backing the Trump administration include Hyundai Motor Co , Mazda, Nissan Motor Co, Kia Motors Corp and Subaru Co.

GM had drawn the ire of many California officials and environmental groups.

Dan Becker, director of the Safe Climate Transport Campaign, said “GM tried to prevent California from protecting its people from tailpipe pollution. They were wrong. Now the other automakers must follow GM and withdraw support for (President Donald) Trump’s attack on clean cars.”

In September, California Governor Newsom said the state planned to ban the sale of new gasoline powered passenger cars and trucks starting in 2035 in a bold move to reduce greenhouse gas emissions.

California is the largest U.S. auto market, accounting for about 11% of all U.S. vehicle sales, and many states choose to adopt its green vehicle mandates.

(Reporting by David Shepardson; Editing by Chizu Nomiyama and Tom Brown)

California vows to ban sale of new gasoline-powered passenger vehicles in 2035

By David Shepardson and Nichola Groom

WASHINGTON/LOS ANGELES (Reuters) – California plans to ban the sale of new gasoline powered passenger cars and trucks starting in 2035 in a dramatic move to shift to electric vehicles and reduce greenhouse gas emissions, Governor Gavin Newsom said on Wednesday.

Newsom told a press conference the state was committing to a “firm goal” to phase out the sale of new gasoline-powered vehicles by 2035 and was encouraging other states to take similar action.

Newsom’s order labeled the elimination of gasoline-powered vehicles a “goal” and a “target” after his office said earlier his order would require the sale of nothing but zero emission passenger vehicle starting in 2035.

The move would be the most significant to date by a U.S. state aimed at ending the use of internal combustion engines for passenger travel.

California is the largest U.S. auto market, accounting for about 11% of all U.S. vehicle sales, and many states choose to adopt its green vehicle mandates.

Newsom also wants the state legislature to stop issuing new permits by 2024 allowing use of hydraulic fracturing technology for oil and gas drilling.

U.S. President Donald Trump has sought to bar California from requiring the sale of electric vehicles, while his rival Joe Biden has pledged to spend billions to speed the adoption of electric vehicles.

California said it was joining 15 countries that have made similar pledges, including Britain.

California’s clean vehicle goals have not always come to pass and in some cases have been pushed back.

Newsom said the California Air Resources Board (CARB) will develop regulations to mandate that 100% of in-state sales of new passenger cars and trucks are zero-emission by 2035, which would cut greenhouse gas emissions by 35%. The board also plans to mandate by 2045 that all operations of medium- and heavy-duty vehicles be zero emission where feasible.

Newsom’s executive order does not prevent Californians from owning gasoline-powered cars or selling them on the used car market.

In response to a record wildfire season in the state, Newsom earlier this month said California needed to “fast track” its efforts to reduce greenhouse gas emissions and combat climate change. “Across the entire spectrum, our goals are inadequate to the reality we are experiencing,” he said on Sept. 11 while touring a burned area in the state.

A group representing major automakers including General Motors Co, Toyota Motor Corp and Volkswagen AG said “neither mandates nor bans build successful markets.”

The group noted electrified vehicles account for less than 10% of new vehicle sales in California, which is still best in the United States.

California and nearly two dozen other U.S. states have sued the Trump administration, which has rolled back Obama era vehicle emissions standards and sought to undo California’s authority to set strict car pollution rules.

The administration has been waging a multi-pronged battle to counter California’s efforts to fight climate change by reducing emissions of greenhouse gasses from vehicles.

(Reporting by David Shepardson and Nichola Groom; Editing by David Gregorio and Tom Brown)