California Allocates $6.1 Billion in its Budget for Zero-Emission Vehicles

The budget also set aside $2 billion for clean energy projects, including $380 million for battery storage

January 12, 2022


In the state’s budget for the financial year 2022-23, California Governor Gavin Newsom allocated $6.1 billion towards zero-emission vehicle (ZEV) acceleration.

The investment would include a General Fund of $3.5 billion, a $1.5 billion proposition, $676 million of Greenhouse Gas Reduction Fund, and a Federal Fund of $383 million.

With this, the Governor aims to bring the total investment of $10 billion in ZEV acceleration over the next six years to decarbonize California’s most polluting transportation sector.

Low-income ZEVs and infrastructure

The government plans to invest $256 million for low-income consumer purchases and $900 million to expand affordable and convenient ZEV infrastructure access in low-income neighborhoods. The investment will be used to deploy a range of charging options, including grid-friendly high-power fast chargers and at-home charging facilities, to support communities.

Heavy-duty ZEVs and infrastructure

Newsom allocated $935 million to add 1,000 zero-emission short-haul trucks and 1,700 zero-emission transit buses. The $1.5 billion Proposition will support school transportation programs, including advancing electric school buses in a coordinated effort between educational and energy agencies. The budget also factored in $1.1 billion for zero-emission trucks, buses, off-road equipment, and fueling infrastructure. Another $400 million will be invested to electrify ports.

Zero-emission mobility

The Governor granted $419 million to support sustainable community-based transportation equity projects in the budget. These projects would help low-income communities access zero-emission mobility. The investment includes clean mobility options, sustainable transportation, and equity projects.

The budget also incorporated  $200 million investment in demonstration and pilot projects in the high-carbon emitting sectors like maritime, aviation, rail, and other off-road applications and support vehicles’ grid integration at scale.

Earlier in 2020, Newsom had issued an executive order to phase out gas-powered cars and vehicles in the state by 2035 to tackle the climate change crisis.

Clean energy technologies

To combat the climate crisis and address the scale of California’s changing energy needs, $2 billion was allocated to deploy clean energy technologies in the energy system to achieve a diverse and reliable electric power source. The investment is expected to enhance the decarbonization of buildings, agriculture, and industry through new technologies to decrease consumer costs.

The state government is expected to invest $380 million General Fund over two years in long-duration storage projects to support grid reliability. The storage projects would help face emergencies like wildfires and internment renewables into the grid.

The General Fund of  $100 million is set aside to enhance the use and production of green hydrogen, in which electricity is used to split water into hydrogen and oxygen.

The Governor earmarked $210 million to accelerate industrial sector decarbonization. The investment would provide a grant program to purchase and deploy commercially available advanced technologies and equipment to decarbonize industries while reducing criteria pollutants in disadvantaged communities.

The state government provided $45 million in the budget to advance the offshore wind energy program deployment in federal waters of the state.

For the decarbonization of buildings, the Governor announced a budget of $962.4 million. Of this, $622.4 million funds for over two years would be utilized to replace fossil fuel appliances with electric appliances, energy-efficient lighting, and building insulation and sealing.


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