Electrifying Rideshare in California

9 November 2021

Roughly one year ago, Governor Newsom’s administration issued a mandate requiring that all passenger vehicles sold in the state be zero-emission by 2035. California was rightfully hailed as a leader in the space, and other states have since issued similar zero-emission vehicle (ZEV) plans. Earlier this year, in the same progressive spirit, the California Air Resources Board (CARB) formally expanded the scope of the state’s vehicle electrification goals to include ridesharing companies, also known as transportation network companies (TNCs). Under the Clean Miles Standard, rideshare companies will have until 2030 to reduce greenhouse gas emissions to zero and ensure 90% of their vehicle miles are fully electric. Given that the transportation sector remains the largest source of greenhouse gas emissions in the state, and that electrifying one ride-hail vehicle has the same CO2 reduction benefit as converting three regular gas-powered passenger vehicles, this is huge!

California is the first state in the country to adopt such a rule, dramatically impacting prominent ridesharing companies like Uber and Lyft. The proposed regulation’s target of 90% electric vehicle miles by 2030 is supported by interim targets each year from 2023 (when the regulation will take effect) until 2030 - 13% of vehicle miles must be electric by 2025, and 30% by 2026, for example. In just six years, at least half of the vehicle miles traveled (VMT) by rideshare companies will have to be powered purely by electricity.

Fortunately, transportation electrification is not a foreign concept to TNC giants Uber and Lyft, who account for 99% of the rideshare market in the US. In fact, the companies are setting more ambitious goals for themselves than are mandated by CARB - last year, both separately announced a goal of electrifying 100% of their US fleets by 2030. With both Uber and Lyft employing roughly a million drivers each across the US, this will be no easy feat. And however admirable these goals may be, the path to a 100% TNC EV 2030 remains fuzzy for both companies. Currently, only 0.5% of rideshare vehicles in the US are electric. Needless to say, these companies have their work cut out for them.

Uber has begun developing programs and partnerships to help its drivers go electric. For starters, drivers of fully electric vehicles in the US and Canada are eligible for a limited-time-only Zero Emissions incentive, which lets them earn an extra $1 on every Uber trip, up to $4,000 annually. Additionally, EV drivers can opt into Uber Green, a new lower emissions option on the app through which drivers can make an additional $0.50 per ride, paid for by the rider. Uber has also launched an EV education platform, allowing drivers to browse and compare EVs and explore available incentives. As for charging, Uber has partnered with EVgo and Enel X to help drivers save on fast charging and chargers, respectively. On the vehicle side, Uber driver-specific discounts on Chevy Bolt EVs and Nissan LEAFs are available, and drivers have access to innovative EV leasing models through Uber partnerships. Recently, car rental company Hertz announced that it would be adding 100,000 EVs to its fleet and that half of these would be reserved for Uber drivers to rent at an affordable weekly rate. Learn more about Uber’s EV initiatives here.

Lyft, for its part, is also piloting a “Green Mode” option in Seattle and Portland before making it available more widely. They are also working to expand the availability of EVs through Express Drive, Lyft’s vehicle rental partner program. Drivers currently participating in this rental program are saving between $50 and $70 per week in fuel costs. More generally, Lyft publicly emphasizes the cost savings for drivers who switch to electric and views overnight home charging in particular as a cheap and convenient option for its EV drivers (and the option most EV owners prefer). Of course, drivers may very well need to charge during the day, hence the importance of public DC fast chargers where drivers can stop for 20-30 minutes to receive a full charge. Learn more about Lyft’s EV initiatives here and through their forward-looking “Path to Zero Emissions” plan.

In short, the electric rideshare era is upon us, an exciting step in the larger push for transportation electrification. Luckily, with public and private sector goals aligned and enthusiasm for TNC EVs high, California is well positioned to pave the way for rideshare electrification in the coming decade. PG&E is eager to further the transportation electrification efforts in this crucial sector. Through our EV Savings Calculator, rideshare drivers can explore affordable EV models, discover incentives, and more. In PG&E’s territory, there are over 20 EV models around or under $30,000 after available incentives are taken into account. Used models or rental plans can render EVs even more affordable. Given the higher-than-average vehicle miles traveled (VMT) of many rideshare drivers, the lower fueling and maintenance costs of an EV will pay off even more quickly.

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