The largest part of the Volkswagen diesel settlement moved forward on Tuesday when a federal judge said he was inclined to approve the plan — with a final decision coming October 25. Some of the players in the electric car business are concerned, however, that the electric vehicle promotion portion of the $15 billion settlement could be used to help or hurt other companies by giving Volkswagen the ability to pick winners and losers, according to Wired.
The settlement consists of three parts. People who bought 2.0-liter diesel cars in the U.S. from 2009 to 2015, in all about a half million vehicles, will be compensated from the biggest piece of the pie at $10 billion. Another $2.7 billion will be spent to mitigate damage to the environment that resulted from all those dirty diesel cars driving around the country. The remaining major chunk of cash, and this is the part the EV industry is concerned about, is $2 billion VW has to use to promote electric vehicles and build out the U.S. EV charging infrastructure.
The settlement requires VW to spend $500 million every 30 months, so it has 10 years to play out the funds, mostly as it sees fit. California will get the biggest slice ($800 million) and the Golden State and will have some say in where they charging-station networks will be installed and the types of stations and connectors. According to Wired, however, VW can choose where and what types of charging stations to set up in all other states.
The next 10 years are crucial in the shift to electric vehicles. The concern is that during that time, with its mandate to spend out required funds for charging stations, VW will pick and choose the vendors and technologies to support, which could leave competitors in the cold.
Chargepoint, currently the largest charging station provider in the U.S., has 30,000 locations and in its nine years has raised $173 million. With VW forced to spend more than 10 times as much in the next 10 years, Chargepoint CEO Pasquale Romano says “You just handed them $2 billion of Monopoly money.”
Twenty-eight companies and groups signed a letter to the Department of Justice urging an independent overseer to be sure VW does not knock out competition. Reuters reports the Department of Justice did not buy the letter’s argument, stating the VW settlement allows competition. Others fall on Chargepoint’s side. John Alan James, the executive director of Pace University Center for Global Governance, Reporting, and Regulation said, “Chargepoint is getting it in the neck.”
EVgo, a company with 800 fast chargers declined to sign the letter to the DOJ. EVgo’s head of product strategy said, “VW has an opportunity to do something really terrific for the entire industry.”