VW Subsidiary To Carry Out $2 Billion ZEV And Awareness Programs

Volkswagen Group of America has moved forward on its diesel emissions settlement by establishing a U.S. subsidiary to manage $2 billion spent on zero emission vehicle infrastructure and awareness programs.

Electrify America LLC, based in Reston, Va., will operate the charging station infrastructure development and public awareness campaign. It’s now a wholly owned subsidiary of Volkswagen Group of America, separate from VW’s vehicle brands. Electrify America will be headed by Mark McNabb, who has overseen the diesel settlement in the U.S. and will continue in those duties.

Electrify America will establish more than 500 charging stations across the U.S. More than 300 stations in this infrastructure will be placed in 15 metro areas, and about 200 stations will host a high-speed, cross country network.

Part of the settlement will be launching the “Green City” program in a California city to pilot future concept vehicles and mobility services. These may include a zero emission shuttle service, a carsharing program using electric vehicles, or a ZEV transit program.

Green City would be part of the California settlement, where $800 million of the $2 billion portion of the overall settlement will be invested in California.

In December, California announced that VW would be adding at least three new EVs, including an SUV, in the state by 2020. The automaker also agreed to sell an average of 5,000 EVs annually through 2025 in California.

As part of the settlement, VW has been directed to make its public education and outreach programs brand neutral without VW vehicles being included in the content. Its charging stations are to be accessible to all plug-in vehicles.

VW has agreed to make four $500 million investments every 30 months, and will need to gain approval from the California Air Resources Board and the EPA on the spending plan. For the first funding plan, VW is required to submit draft plans to regulators by February 22.

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How VW’s $2 billion ZEV infrastructure and awareness program will be spent has become a hot topic among companies and government agencies in the U.S. green vehicle and infrastructure segments. Industry conferences, including the ACT Expo in May 2017, have organized speaker panels on how the settlement is being carried out and possible opportunities for automakers and suppliers to participate.

It’s also been a controversial topic for EV infrastructure companies who’ve been concerned that fair competition for charging station contracts would be lost to VW. ChargePoint, which operates the largest U.S. network of charging stations, requested an intervention in federal court in October, claiming the settlement could have an “enormous, and if not modified, potentially disastrous” effect on the market.

The $2 billion is part of the overall $25 billion U.S. spend that VW has agreed to, but there could be more in settlements being worked out. The German automaker has offered to buy back about 500,000 polluting vehicles in the U.S.

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