BILL ANALYSIS �
SENATE JUDICIARY COMMITTEE
Senator Noreen Evans, Chair
2011-2012 Regular Session
AB 2502 (Blumenfield)
As Amended May 8, 2012
Hearing Date: July 3, 2012
Fiscal: No
Urgency: No
BCP
SUBJECT
Vehicles: Conditional Sales Contracts
DESCRIPTION
This bill would revise the automobile conditional sales contract
law to allow electric vehicle charging stations to be sold with,
and financed as part, of an automobile purchase, with a required
disclosure regarding charges.
BACKGROUND
When purchasing an electric car, the prospective purchaser must
make a decision about how the car will be charged. There
currently are three different charging standards - Level 1 (120
volt plug into a regular receptacle), Level 2 (208-240 volt),
and Level 3 (maximum current of 400 amps), with consumers
generally choosing between Level 1 and Level 2. Consumers that
do purchase (and install) a Level 2 charging station will be
able to charge their electric cars at a much faster rate than
those who elect to simply plug the car into the wall. As an
example of the difference in charging times, the Frequently
Asked Questions for the Chevy Volt provides the following
response to the question of how long it takes to charge this
car:
Using a 120V plug outlet, in about ten hours, depending on
the climate, you'll have a fully charged Volt waiting for
you, ready to go. You can also install a 240V charge
station, which can charge Volt in as little as four hours.
In very hot (95? F) or cold temperatures (25? F), charging
times and energy usage will increase when using the 120V
(more)
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portable cord set. A 240V Charging Station is strongly
recommended for consumers who plan to charge in extreme
weather conditions (over 95? F or below 20? F) on a regular
basis. (http://www.chevrolet.com/volt-electric-car/faq/)
Consumers that do desire to install a Level 2 charging station
have several options, including purchasing a station from a
hardware store (and likely contract for installation) or
purchasing a complete installation and hardware package from a
company (each manufacturer recommends certain companies).
Consumers are not able to finance the cost of that charging
station (which may cost up to $1,000) as part of their
electric car purchase because existing law strictly regulates
the contents of the purchase contract. This bill seeks to
address that issue by specifically allowing the sale contract
to include a charge to an EV (electric vehicle) Charging
Station.
CHANGES TO EXISTING LAW
Existing law , the Rees-Levering Motor Vehicle Sales and Finance
Act, sets forth numerous disclosure requirements to be included
in an automobile conditional sale contract, including
disclosures regarding finance charges, and sets forth the
permissible fees and charges in an automobile conditional sale
contract for the sale of a motor vehicle. (Civ. Code Sec. 2982
et seq.)
This bill would add a required disclosure regarding charges for
an electric vehicle charging station, which must be labeled "EV
Charging Station" and may include materials, wiring, and
equipment installation, each of which shall be separately
itemized.
COMMENT
1. Stated need for the bill
According to the author:
We are at the beginning of a new era in car technology:
that of electric vehicles. Those models currently on the
market come with primary chargers which allow the cars to
plug in to a normal electric outlet, though they require
hours to fully charge the battery. Level 2 Chargers
(so-called secondary chargers) are also available for
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purchase. Most of these secondary chargers are charging
stations that can be installed in electric vehicle owner's
places of residence. They use 220 to 240V to charge the car
battery and thus, can reduce the charge time by more than
half. These secondary chargers costs upwards of $1,000, yet
cannot be financed with the car purchase itself because they
are not considered accessories under current law. There is
no place on the conditional sales contract to document a
charge for such an item. This provides a barrier to car
buyers who are interested in purchasing an electric vehicle,
and the secondary charger along with it. Although they can
finance the car, they must find alternative financing to
purchase the secondary charger- which, for many, is the
feature that would make owning an electric car feasible (due
to reducing charging times).
AB 2502 creates a line on the conditional sales contract so
that secondary chargers may be financed with the vehicle.
Other add on items, such as Lo-Jack and On-Star, already can
be financed with the vehicle itself. This would be a
similar such item, except it is not installed in the vehicle
itself, but rather in the vehicle owner's residence.
2. Financing electronic vehicle charging station
This bill seeks to facilitate the purchase of electric vehicles
by allowing purchasers of those vehicles to finance the cost of
an electric vehicle charging station. To allow that financing,
this bill would specifically allow a conditional sales contract
(the sales contract for the vehicle) to include a charge for an
electric vehicle charging station. That item would be required
to be labeled "EV Charging Station" and may include materials,
wiring, and equipment installation, each of which shall be
separately itemized. The California New Car Dealers
Association, in support, asserts:
Many consumers are wary of this new technology, whether
because of the additional cost, "range anxiety" or
hesitation about changing driving habits, despite the
potential long term fuel savings and environmental benefits.
Reducing barriers to acceptance is the purpose behind AB
2502. The bill will allow a consumer to finance the
purchase of a ZEV or TZEV and the necessary or desired
charging station, including materials, wiring, and equipment
installation, at the time of purchase in one transaction.
We believe this will greatly enhance the ability of
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consumers to accept making the transition from the purchase
of a traditional internal combustion engine to the ZEVs and
TZEVs of the future.
Staff notes that the requirement for the cost of the charging
station to be itemized allows a consumer to shop around to
compare whether the total cost is a fair value. For example,
Level 2 charging stations are available at some local hardware
stores for around $800, while other charging stations cost
several thousands of dollars. A purchaser of an electric car
would be able to look at the itemized cost required by this bill
and compare whether the cost being charged for the charge is, in
fact, reasonable compared to the other options that are
available.
From a practical standpoint, even absent the itemization,
allowing the cost of the charging station to be financed as part
of a purchase would likely appeal to many consumers because it
removes the hassle of making other arrangements for the
installation of a charging station. As a result, this bill
would appear to further facilitate the use of electric vehicles
in California.
Support : Alliance of Automobile Manufacturers; California New
Car Dealers Association
Opposition : None Known
HISTORY
Source : Author
Related Pending Legislation : None Known
Prior Legislation : None Known
Prior Vote :
Assembly Rules Committee (Ayes 10, Noes 0)
Assembly Judiciary Committee (Ayes 10, Noes 0)
Assembly Floor (Ayes 76, Noes 0)
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