Lyft's 2030 all EV goal
Mike Zaccardi, CFA, CMT
Some big news this week in the utility space – Lyft announced that all vehicles in the ride-sharing company’s fleet will be electric by 2030. This could expedite big changes for the EV market – particularly in California where Lyft is headquartered.
But why should a tried & true utility in the Midwest care?
If there is indeed a sharper push toward electric vehicles, then it could bring about bigger changes in the way we all use power. Changing patterns in hourly usage would have major impacts to the operations and risk management strategies for even the steadiest utility companies.
I work with many public power entities who are always monitoring the latest market trends, though their customer base and generation assets may not experience major changes year by year. While the business operations may be steady, we all know the market is changing fast.
Before COVID-19, every power market conference would touch on the expected growth in the EV market. It’s happening Europe and it’s likely on the way here in the USA.
If there is a widespread adoption of EV, that will obviously mean less in the way of gasoline demand for the energy sector, but it will also mean more power demand overnight as we all charge our cars. It could prop-up off-peak prices, just as one example. Risk managers at utility firms will have their work cut out for them as they attempt to forecast & model these potential demand changes.
Lyft’s announcement also has wider implications. The move comes in a response to climate change. Lyft seeks to work with the Environmental Defense Fund to reduce emissions and work toward a 100% EV fleet. Expect more corporate moves like this as the ESG (environmental, societal, corporate governance) trend may only grow following COVID-19 around the globe and social unrest in the US.
Read more about Lyft’s announcement here.
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Chart used with permission from Tradingview.com