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April 5, 2021

Biden Infrastructure Plan Would Electrify the Postal Fleet

But the USPS is already moving to upgrade its vehicles without making
them fully electric.

 

Only 10 percent of the new vehicles that the U.S. Postal Service has
contracted are intended to be electric. (USPS)

The Chief

****

**The American Jobs Plan, the first half of Joe Biden's effort**to
rebuild America, is actually kind of a confounding document for news
outlets. It's so comprehensive and packed with policy that any attempt
to describe it as a whole would just fall into summary. And yet
there's so much to cover that the fact sheet

doesn't have the space to go into a ton of detail. Little asides or
brief descriptions could merit an entire article.

So that's what we're planning to do. The

**Prospect** is aiming to cover every policy in the American Jobs Plan,
and the forthcoming American Families Plan, the social welfare portion
of the package, which will be announced in a couple weeks. We already
kicked this off with Gabrielle Gurley's piece

on installing 500,000 electric vehicle charging stations across the
country, and the challenge of making them all compatible with all the
proprietary plugs and adapters that EV companies have created.

This is going to be the major legislative product of the Biden first
year, and maybe the first term. The American Rescue Plan was notable but
temporary; this is a much more enduring set of policies. So it's worth
diving in. All this week I'm going to choose one policy and pick it
apart.

What I want to know is whether the legislative reality will live up to
the concept. One line in a fact sheet does not preordain an effective
policy, and there are a bevy of little decisions and trade-offs that
will determine the outcome. Take for example the provision I will tackle
today: the mention in the AJP fact sheet to "utilize the vast tools of
federal procurement to electrify the federal fleet, including the United
States Postal Service."

**Read all of our First 100 reports here**

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**** For years, electrifying the postal fleet has been one of the
easiest wins

to improve public health, the environment and the fiscal outlook of the
struggling U.S. Postal Service. FedEx
,
UPS
,
and Amazon

have all recognized the value of electric vehicles in ground shipping,
not only for greenwashing PR value but to eliminate a major
unpredictable cost center: fuel. But even these deep-pocketed giants are
taking their sweet time with electrification: FedEx has only committed
to an all-electric fleet by 2040, Amazon will have its ballyhooed
100,000 clean vehicles on the road by 2030, and UPS is just testing out
replacing a subset of its fleet.

So it was very much in line with this hesitancy when Postmaster General
Louis DeJoy (remember that guy? Still in office with no end in sight
?)
announced granting the USPS fleet contract
to
Oshkosh, a small defense company in Wisconsin, with only 10 percent of
the fleet guaranteed as electric, even though the Postal Service's
recent ten-year plan envisions a fully electric fleet by 2035
.
The Oshkosh vehicles are those cute-looking ones you've seen so much
of, but what's not so cute in most of them is the internal combustion
engine. The prototype runs on diesel; Oshkosh has never built an
electric car.

This was a huge missed opportunity. The Postal Service manages around
229,000 vehicles, and the average age of the standard postal trucks,
developed by Grumman Aerospace back before it merged with Northrop and
became defense giant Northrop-Grumman, is 28 years. Maintenance alone
costs $2 billion a year , and
fueling costs about $500 million
, more than any
other agency in the government.

Electricity is a much cheaper fuel than gas or diesel, saving hundreds
of millions in fuel costs. Electric vehicles have fewer parts, so the
enormous maintenance costs would drop too. And beyond cost savings, this
investment would cause a huge reduction in greenhouse gas emissions,
literally in every community in the nation. That means cleaner air and
fewer respiratory complications. Especially as the Postal Service's
10-year plan calls for more ground rather than air transportation, the
agency will be using more potentially carbon-burning fuel in the near
future, increasing the urgency to electrify the fleet.

Given that daily postal routes are relatively centralized, even in rural
areas all charging could likely be done back at postal depots, and since
the trucks sit overnight, you wouldn't even need particularly fast
charging equipment, meaning you could maintain the current 120V wiring
in every postal facility.

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The Oshkosh contract was long overdue, but to not then make it electric

defies logic. Unless there were other considerations. The day before the
contract announcement, there was an anonymous $54 million trade

in Oshkosh shares. The contract terms are confidential, and the House
Oversight Committee has been asking for it
,
with a deadline of March 26. There's no indication that the USPS met
that deadline.

For his part, DeJoy said in recent testimony that the USPS could
electrify the fleet quickly for $8 billion. It's unclear why there
would be higher lifetime costs from electric vehicles rather than
gas-powered ones, as DeJoy claims. But again, those contract terms are
secret.

Fortunately, the American Jobs Plan aims to spend $2.25 trillion, of
which $8 billion is a pittance. It's something lawmakers like Rep.
Jared Huffman (D-CA) have been calling for since at least 2014
.
However, doing so under the existing contract with Oshkosh, which again
has never made an electric vehicle and has no supply chain for it, might
be a huge mistake. Workhorse, an Ohio-based company that was a finalist
for the contract, makes electric vehicles. Having Oshkosh make a custom
vehicle from scratch, on fairly low volume (165,000 trucks tops over 10
years), will be more expensive than necessary, and more important, risks
being inefficient or poorly made by a novice firm.

Oshkosh has also talked about converting the vehicles from internal
combustion engines to electric down the road, which I've seen small
bespoke companies do on classic cars like VW Bugs, but not

**en masse**to tens of thousands of them. That would add funding and
it's no guarantee that process would be smooth.

So while it's a great idea, the bid to electrify the fleet is coming
into contact with a live process to upgrade postal trucks, and the two
decisions do not mesh well. That will have to be worked out almost
immediately, before the Biden plan passes months down the road. You'd
think Biden would want to have a postmaster general he trusts in place
to make that decision, rather than a holdover from the Trump years who
has accompanied a severe decline in the quality of the institution.

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What Day of Biden's Presidency Is It?

Day 76.

We Can't Do This Without You

Today I Learned

* This broke late Friday: there's a pathetic attempt afoot to
disqualify Jonathan Kanter

from running the DOJ Antitrust Division because he opposed Google. Which
is something DOJ Antitrust has an active case on right now! (Politico)

* Biden tossed AstraZeneca out

of the Baltimore vaccine manufacturing plant, making it exclusive to
Johnson & Johnson. (

**New York Times**)

* A decent explanation of Bidenomics
. I'd
foreground investment, as that's the real break from the
Reagan/neoliberal era. (Noah Smith)

* A big problem Biden will have to deal with on the economy going
forward is long-term unemployment
.
(HuffPost)

* Locking in the taxes on this infrastructure and jobs plan is going to
be a slog
.
(

**Wall Street Journal**)

* Janet Yellen's diplomacy on a global minimum tax rate

is a critical part of the legislative path of the administration.
(Axios)

* Gitmo being consolidated
,
at least. (

**New York Times**)

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