The Regulatory Roaches In Tesla’s ZEV Credit Soup

I find the legal reasoning in both factsheets compelling and while courts can enjoin regulatory actions of an agency that are arbitrary and capricious, I think the planned joint actions of these two agencies are well within their statutory authority and the letter of the law. Since the two factsheets didn’t address the question whether California’s ZEV mandates created a reasonable path to accomplish its stated regulatory goal I submitted a comment on the proposal that:

  • Calculated cumulative average daily driving distance for the entire Tesla fleet of approximately 32.75 miles;
  • Observed that an EV with a 50-mile range that generates one ZEV Credit would eliminate the substantial bulk of the average Tesla driver's fuel consumption; and
  • Concluded that there is no rational regulatory basis to award 1 ZEV Credit to an EV that eliminates the substantial bulk of the Tesla average driver's fuel consumption and to award 2.5 additional ZEV Credits to an EV with a 300-mile range that offers no material additional fuel savings.

The twitter stream from “People’s Grain@ad8871” did a wonderful job of analyzing the current supply and likely future demand for ZEV Credits. The only issue I had with the logic were Tesla’s sales of $179 million of ZEV Credits in Q4-17 and another $50 million in Q!-18. Since neither of these transactions would make a lick of sense in light of the supply and demand dynamic outlined by People’s Grain, I had to assume some other factor was and might still be in play.

View single page >> |

Disclosure: Put position on TSLA.

How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.
Adam Reynolds 2 years ago Member's comment

Any updates on this?

Bill Johnson 2 years ago Member's comment

Thanks for this important update on $TSLA.