The Electrification Backlash

The “electrification of everything” movement has scored key victories of late. Last year’s Inflation Reduction Act (IRA) provides billions of dollars in incentives and investments to electrify vehicles, buildings, and homes, including energy storage, heating, and stoves. And carmakers are accelerating their plans to go all-in on electric vehicles (EVs).

But as policymakers become more aggressive in their electrification push, some lawmakers are beginning to push back. In response to California enacting a ban on internal combustion engine (ICE) vehicle sales by 2035, lawmakers in Wyoming have introduced their own legislation that would ban electric vehicle sales in their state. Now, while the Wyoming bill may be only a half-hearted troll of California’s Governor Newsom (D), Mississippi lawmakers are taking a more serious aim at the EV industry. The Mississippi House approved a bill last month to block EV manufacturers from operating their own storefronts in the state. This legislation is wrapped up in the long-running franchise laws between manufacturers and dealerships, but since new EV companies sell their products directly to consumers, the legislation would have the largest direct effect on EV sales.

Stoves are the newest flashpoint in the electrification movement. Now that electric induction stoves have emerged as the green-hype product of the moment, the U.S. Consumer Product Safety Commission (CPSC) created a flurry of controversy over a rumored proposal to restrict the use of gas-powered stoves in homes. While fears over the federal proposal appear to have been overblown, as my colleague Billy Culleton wrote recently, the battle over gas-powered stoves has been raging for years on the state and local levels. Washington and California have issued statewide rules on restricting the use of natural gas in commercial buildings, while Los Angeles, New York City, San Francisco, Seattle, and D.C. have each adopted rules that would either ban or limit the use of natural gas in new residential and commercial buildings. And in response, twenty state legislatures have preempted localities from prohibiting the sale of natural gas to customers. We’ve seen a flurry of bill introductions already on this issue, and presidential-hopeful Gov. DeSantis (R) has turned up the heat by offering a tax exemption for the purchase of gas stoves in Florida, saying  “They want your gas stove and we’re not going to let that happen.”
The biggest fear for fans of electrification is that anti-electrification becomes a rallying cry for conservative lawmakers and gets wrapped into the anti-ESG movement that continues to expand this year. Differentiating between incentives to electrify (e.g., IRA) versus mandates or prohibitions (e.g., California's 2035 ICE ban) will be key here. But at the end of the day, consumers will choose electric products when they’re convinced that the electric versions are superior to the alternatives.

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