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California Sets Green Goals for Ride-Hailers Like Lyft, Uber (1)

May 20, 2021, 8:57 PM; Updated: May 20, 2021, 9:49 PM

California air regulators on Thursday set first-in-the-nation regulations for ride-hailing services like Uber and Lyft, requiring that 90% of fleets be electric by 2030.

The California Air Resources Board also set a target of zero carbon dioxide emissions for fleets within the same time period.

Ride-hailing fleets drove 4.8 billion miles in 2018. The vehicles tend to be newer than the average car on the road but they emit 50% more greenhouse gas emissions per passenger mile because 38% of all trips are dead-heads, meaning no rider is present.

“We have a great opportunity to have this significant revolution in transportation be a clean revolution,” Sen. Nancy Skinner, who authored the bill that set this regulation in motion, said before the vote.

The targets go into effect in 2023 and ramp up over time. Between 2023 and 2031 the rule is expected to reduce greenhouse gas emissions by 1.81 million metric tons and fine particulate matter by 93.21 tons.

The Clean Miles Standard is meant to increase fleet electrification while reducing greenhouse gas emissions and vehicle miles traveled. The new rule will help California meet its climate goals and federal air standards, state officials said.

It could also be the start of a new way to achieve reductions. “This rule could be a model for rules for other fleets,” Coalition for Clean Air Policy Director Bill Magavern said.

Read more: How Uber and Lyft Are Losing the Race to the Electric Future

Earning Credits

Companies will be able to earn credits for a number of actions, including connecting riders to mass transit, offering rides as part of a fare system ticket, and repairing sidewalks.

Trip data will be separated into three segments: looking for riders, heading to a rider, and with a rider in the vehicle. Trips with shared rides will be scored more favorably to encourage carpooling, which means less cars on the roads.

Ride-hailing services that travel less than 5 million vehicle miles annually will be exempt, as will wheelchair-accessible trips.

Lyft has already committed to 100% fleet electrification by 2030, the company said previously. Uber has pledged the same and has set aside $800 million to help drivers switch to cleaner cars.

Today, however, 0.5% of ride-hailing vehicles in the U.S. are electric, according to clean-energy research firm BloombergNEF, trailing the 0.7% of EVs in the country’s passenger vehicle fleet.

‘Work of All of Us’

Getting all drivers to use fuel cell or battery-electric vehicles will require help from many places, including the ride-hailing firms, regulators, drivers, manufacturers, and backers of charging infrastructure, said Paul Augustine, Lyft’s senior manager of sustainability.

“It’s going to take the work of all of us to achieve this goal,” he said.

Gloria Pak, from the air board’s Advanced Clean Car Regulations section, said drivers supported the goals but were concerned about the price to comply. The estimated cost savings to drivers in 2027 is estimated to be $1,670 for drivers who travel 20,000 miles and $2,212 for those who go 30,000 miles in a year.

The regulator doesn’t have authority to require the costs fall on the ride-hailing companies. “We must find new ways to help drivers on the platform,” Pak said.

Many board members were concerned that the mandate would force costs on drivers—from buying to using public chargers. Many drivers are from low income areas and have been classified as independent contractors.

“This is going to be really problematic for the drivers,” said board member Daniel Sperling, who is also founding director of the Institute of Transportation Studies at the University of California, Davis.

Their resolution included language that the effect to drivers would be monitored by the air board, as well as the California Public Utilities Commission, which now will work to implement the regulation.

(Story updated throughout.)

To contact the reporter on this story: Emily C. Dooley at edooley@bloombergindustry.com

To contact the editor responsible for this story: Chuck McCutcheon at cmccutcheon@bloombergindustry.com

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