New Jersey’s planned adoption of California’s Advanced Clean Car II (ACC II) rules stirred a heated exchange Thursday as business groups argued the state is far from ready for a sudden surge in electric vehicle use and environmentalists argued climate change threats demand the rules be in place by 2024.

Groups representing car dealers, gas station convenience stores, the petroleum industry, businesses and other sectors at an online public hearing on the rules organized by the New Jersey Department of Environmental Protection said mandating EV sales would disenfranchise numerous low-income consumers who already struggle to buy a car.

The three-hour online hearing, the only one scheduled, drew more than 40 speakers. It came as ACC II supporters are urging the administration of Gov. Phil Murphy (D) to have the rules in place by the end of the year so they can impact the 2027 model year. The eight-week-long public comment period will end Oct. 20. (See NJ Sets Advanced Clean Cars II Proposal in Motion.)

ACC II calls for a steady increase in EV sales as a portion of all new light-duty vehicle sales, until they account for 100% in 2035. But, business groups argue, that mandate would push up the price of used cars as consumers looked for a cheaper alternative to the higher-priced clean energy-fueled vehicle, framing the rules as a big government intervention in what should be a decision by the market.

“New Jersey and all the other ACC II states will be a 100% EV sales market when consumers want to buy only EVs, not when government mandates it,” said Jim Appleton, president of the New Jersey Coalition of Automotive Retailers (NJCAR).  “Frankly, we believe this plan will frustrate and cause a consumer backlash that will slow our roll to an EV future, not accelerate.”

He argued that if consumers face a mandate for sales increases when they find the prices high, or access to the charging infrastructure unreliable, they will simply “hold on to their older cars longer or opt into the used car market which is not regulated by ACC II.”

Other opponents argued the state’s grid is not ready to provide the amount of electricity needed to serve hundreds of thousands — perhaps millions — of EVs. And they questioned the impact on carbon reduction, saying much of the electricity still might be generated with natural gas.

‘Shackles of Saudi Arabia’

Supporters of the rules — including EV manufacturers, health care professionals and some businesses — made up the majority of speakers at the hearing, however. They argued that recent extreme weather events — including the hottest summer on record — show the state needs to rapidly stoke EV adoption.

Pam Frank, CEO of ChargeEVC, a nonprofit coalition that promotes EV growth, said that with 123,000 EVs on the road in June, the state still is far from its goal of 330,000 EVs by 2025. A draft Strategic Climate Action Plan released by the DEP last week said the state would need 4.5 million light-duty EVs by 2035 to meet the state’s clean energy goals, accounting for 73% of all light-duty vehicles.

“Allowing the markets to set policy for the kinds of cars we drive will just not get us where we need to be as quickly as possible,” Frank said. “This is not a ban on [internal combustion] engine vehicles,” she said. She added most New Jerseyans buy used vehicles and that market would continue regardless of the new rules.

Supporters of ACC II argued EV prices already are declining and consumers would benefit because powering electric vehicles is cheaper than running on fossil fuel.

“Let me state emphatically that there’s nothing worse for New Jersey’s businesses than high oil prices,” said Sean Mohen, executive director of Tri-County Sustainability Alliance, which promotes sustainability in South Jersey. He argued that oil production cuts by Russia and Saudi Arabia had pushed up gas prices to their highest level this year, and demonstrated the need to focus more on electricity.

“It’s time for America and New Jersey to throw off the shackles of Saudi Arabia for both climate and business reasons,” he said.

Accounting for Health Costs

As adopted by California last August, ACC II requires car manufacturers to provide an increasing percentage of zero-emission vehicles (ZEVs) for sale each year. It defines zero-emission vehicles as battery-electric, hydrogen fuel cell or plug-in hybrid.

The regulation starts with a 35% ZEV sales requirement for model year 2026, increasing to 68% in 2030 and reaching 100% in 2035. ACC II also includes increasingly stringent standards to reduce tailpipe emissions of gasoline-powered cars and heavier passenger trucks.

State officials announced the process for adopting ACC II in February, setting off a vigorous campaign between supporters and opponents over the rules’ merits. A coalition of 100 businesses two weeks ago submitted a letter to state Senate President Nicholas Scutari and Assembly Speaker Craig Coughlin, both Democrats, urging them to reject the rules and instead take legislative action on the issue. (See NJ Businesses Demand Halt to EV Sales Promotion Rules.)

If New Jersey approves the rules, it would be the ninth state to do so. Maryland last week joined Massachusetts, New York, Oregon, Vermont, Virginia and Washington in adopting the California rules. (See Maryland Moves Ahead with Advanced Clean Car and Truck Rules.)

Richard Lawton, executive director of the New Jersey Sustainable Business Council, which represents companies seeking a sustainable economy, said the state should be clear about the motives of some opponents to ACC II.

“EV technology represents a competitive threat to industries and companies who have a vested interest in maintaining the monopoly power of fossil fuels, and [they] are using their economic and political power to raise as many barriers to entry as possible,” he said.

“This is perfectly rational for them, but not for the rest of us,” he said. “Top economists have called climate change the largest market failure in history. So relying on market forces alone to address this market failure would be self-defeating, and frankly, naive.”

Rural Difficulties

Several supporters focused on the health benefits of EVs, saying ACC II especially would improve the quality of life for minority communities that have long suffered the effects of vehicle pollution in urban areas and neighborhoods next to highways.

“Air pollution resulting from transportation in New Jersey is first and foremost a health issue, and discussions of costs that don’t include health costs is imbalanced,” said Dr. Elizabeth Cerceo, chair of health and public policy for the American College of Physicians New Jersey. “When this is factored in, the social and mortality cost of carbon, it outweighs the cost of EV transition. The supposition that the market should dictate the decision ignores the lives lost and the illness caused by fossil fuel pollution.”

But Mary Jo Foley, speaker for the Rural and Agriculture Council of America, argued that adopting ACC II would unfairly and excessively impact the nearly 850,000 residents of the state who live in rural areas.

“New Jersey’s rural and agricultural communities will be hardest hit by this proposal,” she said. “Internal combustion engine vehicles are a necessary part of everyday life for rural Americans, where it’s not an easy task to find an electric vehicle charging station.”

She added that “there will be massive increased demands in the New Jersey power grid, which also likely means higher prices for New Jersey electricity consumers who already pay some of the highest rates in the country.”