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Rural Americans Are Among Those Who Will Benefit Most From An Electric Vehicle Transition. Smart Policies Can Accelerate Their Gains.

Sofya Olenicheva
Sofya Olenicheva
Sofya Olenicheva
October 6, 2022

Access to transportation is a central element of life in any part of the country. However, this is especially true in rural areas, where low population density and limited public transit options make personal vehicle ownership a necessity for many. In these communities, cars serve as multi-purpose tools capable of personal and professional use for daily travel, outdoor recreation, and work. In addition, rural drivers travel 38% longer distances than their urban counterparts. As a result of these circumstances, rural households spent 19 to 22.5% of their total expenditures on transportation between 2019 and 2021. With so much of their budget dedicated to transportation costs, many rural residents are left exposed to high gas prices and in a position to benefit enormously from a switch to electric vehicles (EVs). 

Despite this potential, investments in transportation electrification have largely bypassed rural Americans. Recent policy developments, including the passage of the Infrastructure Investment and Jobs Act (IIJA) and the Inflation Reduction Act (IRA), are prime opportunities to put rural Americans at the forefront of any policy targeting national electric vehicle deployment. An equitable, sustainable, and successful EV transition cannot happen without targeted investments in rural America.

EVs have the power to deliver substantial financial savings for individual drivers and households: in addition to saving on gasoline, EVs have a significantly lower total cost of ownership (TCO) because of maintenance and service savings. For example, the Environmental Protection Agency estimates that charging at home costs the equivalent of $1.18 per gallon. EVs also have substantially fewer moving parts that need regular maintenance, meaning that a rural EV owner can save an average of $4,600 on avoided oil changes, transmission fluid replacements, and other upkeep costs alone over the vehicle’s lifetime. Pickup truck drivers, in particular, stand to realize even greater savings: after seven years, an EV pickup truck can save $9,000, nearly double the savings for a light-duty vehicle. Accounting for a series of factors—gas cars’ higher cost of fueling and maintenance, as well as the higher vehicle miles traveled by rural drivers compared to their urban counterparts—an EV owner in a rural area can expect to save between $1,900 and $2,800 a year by making the switch.

In addition to consumer savings, EVs have the power to benefit rural communities on a larger scale. Every state is an “auto state,” home to suppliers and manufacturers who produce parts for all vehicle power trains. Manufacturing is also an important source of employment and economic growth in many rural areas: as the country rapidly shifts to EVs, building a domestic EV manufacturing capacity and supply chain creates an opportunity to generate robust job growth and make every state an “EV state.” Even as the EV industry is in its nascent stages, this sector added 21,961 new jobs in 2021, a 26.2% increase from the previous year. Rural areas stand to benefit from this growth, and many already have an advantage regarding site selection: auto manufacturers often target rural areas for their established manufacturing infrastructure, larger open building sites, and easy access to rail lines. As a result, rural communities are well-positioned to receive billions in private industry investment as automakers build out the EV supply chain. Many U.S. EV manufacturers—Rivian in Rutledge, Georgia or Ford in rural Kentucky and Tennessee, for example—are doing so already.

Coordination among federal and state governments, utilities, and private sector representatives will magnify the potential of the EV transition to bring benefits to rural communities. To improve equity in workforce development, ZETA recommends DOE and DOT work with State Workforce Development Agencies to create new industry opportunities in addition to the pre-existing training programs by individual charging equipment manufacturers. 

ZETA also recommends that policymakers and local stakeholders work with utility providers to ensure streamlined permitting of EV infrastructure projects—including broadband installation to facilitate remote, over-the-air charger equipment monitoring, updating, and maintenance. IIJA’s $5 billion investment is a prime example of federal, state, and local elected officials working together to build an accessible, interconnected nationwide charging network through the National Electric Vehicle Infrastructure (NEVI) Formula Program. The NEVI program also represents an opportunity to work directly with rural community leaders to provide operations and maintenance support for rural chargers and fund adequate charging infrastructure buildout for medium- and heavy-duty vehicles that often pass through rural areas. 

Aside from those investments, ensuring equitable access to a broad range of EV models is paramount to facilitating widespread EV adoption among rural drivers. Because nearly 74% of car buyers purchase used vehicles, building a secondary market for EVs will expand availability and bring down upfront costs for everyone. However, to sell affordable used EVs, we must first sell new EVs—many of which, like the Ford F150 Lightning, Rivian R1T and R1S, Toyota bZ4X and others—are squarely positioned to serve the needs of rural drivers by offering a 200-plus mile range, superior (10,000 pound-plus) towing capacity, and the ability to serve as a backup power source. Facilitating these sales will require support in the form of incentives and infrastructure. Fortunately, the recently-passed Inflation Reduction Act amends the 30D section of the U.S. tax code to offer eligible buyers a $7,500 point-of-sale tax credit on an EV with certain domestic content conditions and final assembly in North America. Finally, in tandem with these policies, state governments should remove barriers to direct-to-consumer sales, which create an artificial restriction on EV adoption and limit consumer choice by prohibiting automakers who do not use the dealer model to sell in their state.

Upcoming policy developments present an exciting opportunity to change the trajectory of America’s transportation sector from a growing source of carbon emissions to one dominated by clean, efficient, and distinctly American-made electric vehicles. The same policy choices can also vastly improve rural Americans’ lives by generating TCO savings for some of the nation’s most car-dependent communities, while bringing multi-billion dollar investments in manufacturing and creating tens of thousands of skilled, high-paying jobs. Rural Americans’ work in industries such as agriculture, outdoor tourism, and advanced manufacturing is an invaluable contribution to life throughout the country. Giving rural drivers the opportunity to lead the transition away from fossil-fuel dependence is just one way policymakers can create a more equitable, modernized transportation system.

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About ZETA

National policies to support 100% electric vehicle sales.

The Zero Emission Transportation Association (ZETA) is a federal coalition focused on advocating for 100% EV sales. Enacting policies that drive EV adoption will create hundreds of thousands of jobs, secure American global EV manufacturing dominance, drastically improve public health, and significantly reduce carbon pollution.