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Waiver of Buy America Requirements for Electric Vehicle Chargers rule (2023)

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The Waiver of Buy America Requirements for Electric Vehicle Chargers rule is a notice issued by the U.S. Department of Transportation (DOT) effective March 23, 2023, that aimed to temporarily waive Buy America requirements for materials in electric vehicle (EV) chargers. The notice was issued in an effort to enable immediate acquisition and installation of EV chargers.[1]

HIGHLIGHTS
  • Name: Waiver of Buy America Requirements for Electric Vehicle Chargers
  • Agency: Federal Highway Administration, U.S. Department of Transportation
  • Action: Notice

    • Timeline

    The following timeline details key rulemaking activity:

    Background

    The Federal Highway Administration (FHWA) maintains Buy America requirements for steel, iron, and manufactured products, which applies to all FHWA-funded projects and "require[s] that all steel and iron that are permanently incorporated into a project must be produced in the United States unless a waiver is granted, including predominantly steel and iron components of a manufactured product," according to the notice. The FHWA is authorized under 23 U.S.C. 313(b) to consider a waiver to Buy America requirements when they would be inconsistent with public interest or when quantities of products are not sufficiently and reasonably produced in the United States.[1]

    President Joe Biden (D) announced in April 2021 a goal to expand the United States' network of electric vehicles (EVs), including building 500,000 EV chargers by 2030. The FHWA proposed a temporary waiver to Buy America requirements on August 31, 2022, in an effort to "ensure delivery and meaningful results on EV charging projects using Federal-aid highway funds throughout the U.S." according to the notice.[1][4]

    Summary of the rule

    The following is a summary of the notice from the FHWA:[1]

    “ The Federal Highway Administration (FHWA) is establishing a temporary public interest waiver to waive Buy America requirements for steel, iron, manufactured products, and construction materials in electric vehicle (EV) chargers. This short-term, temporary waiver enables EV charger acquisition and installation to immediately proceed while also ensuring the application of Buy America to EV chargers by the phasing out of the waiver over time. On the effective date of this waiver, it will apply to all EV chargers manufactured by July 1, 2024, whose final assembly occurs in the United States, and whose installation has begun by October 1, 2024. Beginning with EV chargers manufactured on July 1, 2024, FHWA will phase out coverage under this waiver for those previously covered EV chargers where the cost of components manufactured in the United States does not exceed 55 percent of the cost of all components. This second phase will therefore apply to all EV chargers that are manufactured on or after July 1, 2024, whose final assembly occurs in the United States, and for which the cost of components manufactured in the United States is at least 55 percent of the cost of all components. For all phases, EV charger housing components that are predominantly steel and iron are excluded from the waiver and must meet current FHWA Buy America requirements. As of the effective date of this waiver, FHWA is also removing EV chargers from its existing general applicability waiver for manufactured products.[5] ”

    Summary of provisions

    The following is a summary of the provisions from the notice:[1]

    “

    In light of the comments received on the proposed waiver demonstrating the inability of EV charger manufacturers to produce a steady and reliable supply of EV chargers, FHWA is making several changes to the timeline in the final waiver for multiple reasons described in further detail below, including to allow manufacturers additional time to domestically source components for their EV chargers:

    1. FHWA is eliminating the proposed first phase in the proposed waiver, which would have applied a complete waiver of Buy America requirements to EV chargers and all components of EV chargers.

    2. The start date of the second phase of the proposed waiver (the first phase of the final waiver), which removes from the waiver EV chargers whose final assembly process does not occur in the U.S., will now occur on the effective date of this waiver instead of January 1, 2023, and the end date of this phase has been extended to June 30, 2024. In addition, during this phase, any housing components that are predominantly steel and iron must comply with existing FHWA Buy America steel and iron requirements, meaning that if predominantly iron and steel housing is used for the EV charger, the housing must be entirely manufactured in the United States according to FHWA standards.

    3. The third phase of the proposed waiver, which would have removed from the waiver EV chargers for which the cost of components manufactured in the U.S. does not exceed 25 percent of the cost of all components, has been eliminated in the final waiver.

    4. The start date of the fourth phase of the proposed waiver (the second phase of the final waiver), which removes from the waiver EV chargers for which the cost of components manufactured in the U.S. does not exceed 55 percent of the cost of all components, has been extended from beginning on January 1, 2024, as in the proposed waiver, to beginning on July 1, 2024. In addition, any housing components that are predominantly steel and iron must continue to comply with FHWA Buy America steel and iron requirements, meaning that the housing must be entirely manufactured in the United States according to FHWA standards. The cost of predominantly steel and iron EV charger housing will also count towards determining whether 55 percent of the cost of all components are manufactured in the U.S.

    5. As required under section 70914(d) of BABA, FHWA is clarifying that it will revisit this waiver and determine whether there is continued need for it within 5 years from the effective date of this notice. The FHWA will also publish RFIs every 6 months until the start of the 55 percent phase to acquire information about the state of the EV charging industry.

    6. The proposed waiver also used the installation date of the EV charger to determine which phase of the waiver would apply to any given EV charger. The final waiver instead uses the date on which an EV charger is manufactured, which is defined in further detail below in Section III.C. However, any EV chargers manufactured before June 30, 2024, (the end of the final assembly phase) will need to begin installation by October 1, 2024, to be covered by this waiver.

    7. The FHWA also has simplified and narrowed the definition of “EV charger” in a manner that will maximize the use of domestic goods, products, and materials. The proposed waiver defined “EV charger” to include EV chargers and associated payment systems, distribution systems, telecommunications and networking equipment, energy storage systems, and other supporting equipment and systems: (i) in the immediate vicinity of a charger or group of chargers; and (ii) essential to the function or operation of a charger or group of chargers. The definition of “EV charger” as used in this final waiver only refers to the self-contained EV charging unit; it does not include associated equipment.[5]

    		”

    Text of the rule

    The full text of the notice is available below:[1]

    Responses

    The following section provides a selection of responses to the notice issued by the FHWA which aimed to temporarily waive Buy America requirements for electric vehicle (EV) chargers.

    Senator Bob Casey (D-Penn.) issued a statement in November 2023 against the Congressional Review Act (CRA) resolution aiming to nullify the waiver. Casey argued that the CRA would require the FHWA to return EV chargers to the general manufactured products waiver:[6]

    “ By forever hindering our Nation’s ability to become less reliant on Chinese manufacturing of EV chargers, this resolution would do irreparable damage to American workers and manufacturing. Because of our domestic EV charging industry, America has the opportunity to become a world leader in the technology of the future. This cynical political ploy would force us to squander that opportunity.[5] ”


    The Biden administration issued a statement in November 2023 outlining the administration's opposition to the CRA introduced in Congress. The statement argues that the resolution would have long-term weakening impacts on Buy America requirements:[7]

    “ Last year, to ensure that the national network of EV chargers is Made in America, the Biden Administration issued a new policy that restores Buy America protections for EV chargers. The Administration’s policy immediately requires that EV chargers purchased through FHWA grants be manufactured in the United States, using domestically produced iron and steel for charger housing. The policy is also phasing in additional Buy America domestic content requirements for EV chargers over the next year to align with the thresholds set forth by Congress as part of the Build America, Buy America Act included in the Bipartisan Infrastructure Law. These actions ensure that federal dollars for EV chargers are used to purchase American-made products, while allowing newly announced manufacturing capacity for EV charger components the necessary time to ramp up production. [5] ”


    Congressman Gregory Murphy (R-N.C.) issued a statement in January 2024 supporting efforts to overturn the waiver, arguing that it has negative impacts on Americans:[8]

    “ President Biden's myopic climate agenda is putting China first and American drivers and workers last. Democrats deceptively used the Inflation Reduction Act to pass $1.2 trillion in green subsidies and subsequently waived Buy America provisions that Chinese corporations are set to cash in on. American taxpayer dollars should not be used to deepen our reliance on foreign adversaries, especially when it comes to critical technologies.[5] ”


    Senator Roger Marshall (R-Kan.), who co-sponsored the CRA resolution to nullify the waiver, issued a statement in July 2023 arguing that the waiver harms U.S. manufacturing jobs:[9]

    “ Congress mandated the Buy America requirements for a reason, to bring jobs and manufacturing back to the United States and reduce our dependence on China. Waiving this requirement is a step in the wrong direction and a complete and total backtrack on Biden’s pledge to prioritize the reshoring of critical supply chains. I support Senator Rubio’s CRA to stop this from taking place and call on President Biden to support American workers by fully implementing the bi-partisan Buy America requirements.[5] ”

    Noteworthy events

    Biden vetoes Congressional Review Act resolution (2024)

    President Joe Biden (D) on January 24, 2024, vetoed a Congressional Review Act (CRA) resolution filed by Senator Marco Rubio (R-Fla.) in July 2023 aiming to nullify the FHWA rule to temporarily waive Buy America requirements for certain materials to build EV charging stations throughout the U.S.[2]

    Rubio argued in a statement that waiving the Buy America requirements “hurts American companies and empowers foreign adversaries, like China, to control our energy infrastructure.”[9]

    The resolution, which received support along party lines with some Democratic legislators joining the vote, passed the Senate on November 8, 2023, with a vote of 50-48, and passed the House of Representatives on January 11, 2024, with a vote of 209-198.

    In his veto message, Biden argued in part that the “resolution would undermine the hundreds of millions of dollars that the private sector has already invested in domestic EV charging manufacturing.”[10] The Senate failed to override the veto on February 29.[11]

    See also

    External links

    Footnotes

    1. ↑ 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 Federal Register, "Waiver of Buy America Requirements for Electric Vehicle Chargers," February 21, 2023
    2. ↑ 2.0 2.1 2.2 2.3 2.4 2.5 Congress.gov, "S.J.Res.38 - A joint resolution providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Federal Highway Administration relating to "Waiver of Buy America Requirements for Electric Vehicle Chargers," accessed February 23, 2024
    3. ↑ 3.0 3.1 Federal Register, "Notice of Proposed Waiver of Buy America Requirements for Electric Vehicle Chargers," August 31, 2022
    4. ↑ The White House, "FACT SHEET: Biden Administration Advances Electric Vehicle Charging Infrastructure," April 22, 2021
    5. ↑ 5.0 5.1 5.2 5.3 5.4 5.5 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
    6. ↑ Bob Casey, "Casey Slams Republican-Led Resolution to Permanently Waive Buy America Standards for Electric Vehicle Chargers," November 8, 2023
    7. ↑ Executive Office of the President, "Statement of Administrative Policy," November 8, 2023
    8. ↑ U.S. Congressman Gregory F. Murphy, "Murphy Votes to Restore Buy America Requirements for EV Chargers," January 11, 2024
    9. ↑ 9.0 9.1 Marco Rubio, "Rubio, Colleagues Move to Block Biden Rule on Chinese EV Chargers," July 26, 2023
    10. ↑ The White House, "Message to the Senate on the President's Veto of S.J.Res. 38," January 24, 2024
    11. ↑ E&E News, "Senate fails to override veto of anti-EV rule resolution," February 29, 2024
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