The Biden Administration has released the first-ever strategy document detailing its plan to target specific freight corridors for infrastructure improvement, with the intent of helping to reach its goal of 100% zero-emission new truck sales by 2040.
The strategy is a cooperation between the Departments of Transportation and Energy (through the Joint Office of Energy and Transportation) and the Environmental Protection Agency. It’s the first attempt of the US government to identify a consistent strategy for electrifying freight transport nationwide.
The offices analyzed how medium and heavy duty freight vehicles move in America, and established priorities of what routes should be targeted first in order to maximize pollution reductions.
Heavy duty vehicles have a disproportionate effect on pollution, as large diesel engines release many more particulate emissions than light-duty vehicles do. These vehicles tend to drive along specific routes, and those routes often go through poorer communities, with 75% of truck traffic traveling on just 4% of the nation’s roads.
This means these places experience disproportionate pollution – and that we can get disproportionate gains just by cleaning up a small amount of roads, instead of targeting every road in the country haphazardly.
So this strategy does target those roads first, focusing on certain “transport hubs” between 2024-2027. Those hubs are in the largest areas for freight traffic around the country, and some associated corridors between or near the hubs. For example, the hub around the Ports of Los Angeles and Long Beach and the logistics centers of the Inland Empire, or the Texas Triangle, or much of the Northeastern seaboard where US population density is highest.
These areas are targeted partially due to how much traffic they see, but also other important factors like areas that experience disproportionate air quality burdens, and with a particular interest in states with policies that enable zero-emission vehicle deployment (specifically, California’s Advanced Clean Trucks rule, which several other states have adopted).
The deployment strategy goes on to connect these preliminary corridors from ’27-’30, then expand the network from ’30-’35, then complete electrification of the National Highway Freight Network from ’35-’40.
The staged deployment also recognizes the limitations of today’s technology. Currently, electric trucks are more than capable for certain tasks like drayage and last-mile delivery, but long-haul trucking and sleeper cabs just aren’t there yet due to the mass and cost of batteries. So in the short term, shorter and more frequent routes, which also tend to go through the most populated areas, will be targeted first. These routes also offer the best cost-of-ownership advantages, another factor the plan takes into account.
The strategy doesn’t just focus on BEVs though, but also acknowledges that hydrogen could help to electrify zero emission heavy duty transport. Due to hydrogen’s higher energy density, it could be useful for long-haul trucking.
But infrastructure difficulties are greater with hydrogen, because hydrogen fueling facilities are costly and rare, and there is no nationwide hydrogen distribution network already established, unlike the ones we have for diesel and electricity. So the strategy will help to identify where the best locations for hydrogen refueling facilities might land.
This strategy doesn’t commit additional money, it merely helps to direct funding, both from government and private sources, into the places that have been identified as the most ripe for electrification. Billions of dollars have already been committed by the federal government largely via President Biden’s two signature legislative accomplishments the Bipartisan Infrastructure Law and the Inflation Reduction Act. In addition, there is additional funding from state governments, and just two weeks ago the EPA committed $3 billion towards cleaning up ports (there’s a webinar about this plan’s funding opportunities tomorrow from 2-4PM EDT).
The full strategy (with ~300 pages listing corridors and port facilities) is available here.
Electrek’s Take
In our recent conversations at events related to heavy duty trucking (e.g. truck charger openings, ACT Expo, municipal truck ride&drive events, etc.), infrastructure is the main topic of conversation. A few years ago, fleets were curious about how EV trucks might be able to fit into fleets like theirs, but things have moved rapidly and now everyone is rushing to install chargers at their depots, or wondering what sort of public charging infrastructure they might be able to find.
Regulators are trying to find ways to streamline these installations, as some of them can be held up and make it difficult for trucking companies to electrify as quickly as governments want them to.
So a directive from the federal government about how to achieve these goals will give a lot of entities more clarity on how to get where we need to be, and on what to target first. There’s no reason to install a huge charging station in Sterling, North Dakota, right now if we can instead target the trucks handling a combined ~20 million TEU on the 710 in Long Beach.
And apparently this was a pretty big deal, since we got comments from every environmental organization you can dream of about this new strategy. The Sierra Club, BlueGreen Alliance, Environmental Defense Fund, International Council on Clean Transportation and more all sent us statements praising the new strategy.
As one final note, as a Californian, I particularly like the shoutout to “states with policies that enable ZEV deployment,” namely California and the states that follow our heavy duty ZEV rules.
In many ways our aggressive zero emission truck rules have set the bar nationally, and proven viability of these strategies in a state with lots of roads and which enables a lot of America’s trucks commerce (through its two largest container ports). I love that we’re leading the way on this and that the Biden Administration seems to be rapidly taking up the banner (and we’re doing pretty well on the light-duty side too).
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Tesla CEO Elon Musk is to officially join Trump’s administration as the co-head of the new US Department of Government Efficiency – a second federal department with the goal of making government spending more efficient.
You can’t get more ironic than that.
Throughout the elections, Musk, who is already CEO of Tesla, and SpaceX, a well as the defacto head of X, xAI, Neuralink, and the Boring Company, has been floating the idea to add to his workload by joining the Trump’s administration to lead a new department aimed at making the federal government more efficient.
He has been calling it the “Department of Government Efficiency”, which spells out ‘DOGE’, a meme that Musk appears to enjoy.
Well, now Trump appears to want to be going through with this idea.
He announced the new department and Musk as head, along with Vivek Ramaswamy, in a statement today:
I am pleased to announce that the Great Elon Musk, working in conjunction with American Patriot Vivek Ramaswamy, will lead the Department of Government Efficiency (“DOGE”). Together, these two wonderful Americans will pave the way for my Administration to dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies – Essential to the “Save America” Movement. “This will send shockwaves through the system, and anyone involved in Government waste, which is a lot of people!” stated Mr. Musk.
What’s most ironic is that there’s already a federal department with the goal of cutting government waste and ensuring efficiency: the Government Accountability Office (GAO).
The GAO’s main objectives are:
auditing agency operations to determine whether federal funds are being spent efficiently and effectively;
investigating allegations of illegal and improper activities;
reporting on how well government programs and policies are meeting their objectives;
performing policy analyses and outlining options for congressional consideration;
issuing legal decisions and opinions;
advising Congress and the heads of executive agencies about ways to make government more efficient and effective
It sounds similar to what Musk described when talking about his DOGE, but Trump hasn’t gone into many details other than it will “cut waste.”
He also has a confusing message as he compares the initiative, which is supposed to cut government spending, to “The Manhattan project”, a massive and expensive government project.
Trump said that DOGE will help the government “drive large scale structural reform”:
It will become, potentially, “The Manhattan Project” of our time. Republican politicians have dreamed about the objectives of “DOGE” for a very long time. To drive this kind of drastic change, the Department of Government Efficiency will provide advice and guidance from outside of Government, and will partner with the White House and Office of Management & Budget to drive large scale structural reform, and create an entrepreneurial approach to Government never seen before.
The statement also noted that DOGE will only operate until July 4, 2026.
Musk has previously claimed that he could cut at least $2 trillion dollars of the $6.5 trillion dollar US federal budget.
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A pump jack in Midland, Texas, US, on Thursday, Oct. 3, 2024.
Anthony Prieto | Bloomberg | Getty Images
Oil prices may see a drastic fall in the event that oil alliance OPEC+ unwinds its existing output cuts, said market watchers who are predicting a bearish year ahead for crude.
“There is more fear about 2025’s oil prices than there has been since years — any year I can remember, since the Arab Spring,” said Tom Kloza, global head of energy analysis at OPIS, an oil price reporting agency.
“You could get down to $30 or $40 a barrel if OPEC unwound and didn’t have any kind of real agreement to rein in production. They’ve seen their market share really dwindle through the years,” Kloza added.
A decline to $40 a barrel would mean around a 40% erasure of current crude prices. Global benchmark Brent is currently trading at $72 a barrel, while U.S. West Texas Intermediate futures are around $68 per barrel.
Oil prices year-to-date
Given that oil demand growth next year probably won’t be much more than 1 million barrels a day, a full unwinding of OPEC+ supply cuts in 2025 would “undoubtedly see a very steep slide in crude prices, possibly toward $40 a barrel,” Henning Gloystein, head of energy, climate and resources at Eurasia Group, told CNBC.
Similarly, MST Marquee’s senior energy analyst Saul Kavonic posited that should OPEC+ unwind cuts without regard to demand, it would “effectively amount to a price war over market share that could send oil to lows not seen since Covid.”
However, the alliance is more likely to opt for a gradual unwinding early next year, compared to a full scale and immediate one, the analysts said.
Should the producers group proceed with their production plan, the market surplus could nearly double.
Martoccia Francesco
Energy strategist at Citi
The oil cartel has been exercising discipline in maintaining its voluntary output cuts, to the point of extending them.
In September, OPEC+ postponed plans to begin gradually rolling back on the 2.2 million barrels per day of voluntary cuts by two months in an effort to stem the slide of oil prices. The 2.2 million bpd cut, which was implemented over the second and third quarters, had been due to expire at the end of September.
At the start of this month, the oil cartel again decided to delay the planned oil output increase by another month to the end of December.
Oil prices have been weighed by a sluggish post-Covid recovery in demand from China, the world’s second-largest economy and leading crude oil importer. In its monthly report released Tuesday, OPEC lowered its 2025 global oil demand growth forecast from 1.6 million barrels per day to 1.5 million barrels per day.
The pressured prices were also conflagrated by a perceivably oversupplied market, especially as key oil producers outside the OPEC alliance like the U.S., Canada, Guyana and Brazil are also planning to add supply, Gloystein highlighted.
Bearish year ahead for oil
The market consensus is that there’ll be a “substantial” oil stock build next year, said Citibank energy strategist Martoccia Francesco.
“Should the producers group proceed with their production plan, the market surplus could nearly double… reaching as much as 1.6 million barrels per day,” said Francesco.
Even if OPEC+ doesn’t unwind the cuts, the future ofl prices is still looking break. Citi analysts expect Brent price to average $60 per barrel next year.
Further fueling the bearish outlook is the incoming administration of U.S. President-elect Donald Trump, whose return is associated by some with a potential trade war, said analysts who spoke to CNBC.
“If we do get a trade war — and a lot of economists think that a trade war is possible, and particularly against China — we could see much, much lower prices,” said OPIS’ Kloza.
For that to happen to retail gasoline prices, oil would need to drop to “below $40” per barrel, said Matt Smith, Kpler’s lead oil analyst.
Right now, retail gasoline prices are at a “sweet spot” at $3 per gallon, where consumers do not feel the pinch and input prices are still sufficiently high for producers, Smith added.