Who Pays For Roads Once Electric Vehicles Defund The Gas Tax?

Most motorists will switch to electric vehicles because of their favorable economics, according to transportation experts, who therefore expect federal and state taxes on gasoline and diesel fuel to evaporate.
The U.S. collected $44 billion in fuel taxes in 2015, according to the Tax Policy Center.
"I think we’ll see a coming rapid shift to electric vehicles," said Edward J. Regan of the consulting firm CDM Smith. "This is something that will also radically change things. Declining battery costs that are coming down very rapidly, increasing battery capacity—the cost of owning a fully electric vehicle will now match an internal combustion engine, especially on a life cycle basis, by 2022 or 23. This will just tangentially also have a major impact on how we fund transportation because it will likely lead to the demise of the gas tax."
The United States collects 18.4¢ on each gallon of gasoline, 24.4¢ on each gallon of diesel. That number has not changed since 1993. Atop the federal assessment, state taxes vary. Electric vehicles could wipe out this primary source of transportation funding, according to transportation experts who gathered at the Transport Chicago conference Friday.
"Electric vehicles have a lot of potential benefits in terms of reduced emissions," said Chris Kopp, the transit group director at HNTB. "They are probably going to require planners to start thinking about power-grid changes. But the big impact, for those who are ultimately figuring out how to spend transportation funds over the next 20 to 30 years, is what effect this has on our existing transportation sources, primarily the gas tax."
Kopp has analyzed Federal Highway Administration scenarios on the likely evolution of the transportation sector. In some of those scenarios, electric vehicles will be responsible for up to 90 percent of vehicle miles traveled.
Habib Shamskhou of the Advanced Mobility Group believes Oregon's road-usage charge program, launched in 2015, will spread.
"What they started in the state of Oregon I think is going to catch fire in the entire nation. There is no other way around it," Shamskhou said. "It’s just a matter of time. Sooner or later, it’s just a matter of time, collectively as a country or state by state we have to go with a user fee."
Kopp believes a vehicle-miles-traveled tax is a likely candidate to replace the gas tax, because the connected-electric-autonomous vehicle revolution should also allay privacy concerns that have hampered a VMT tax so far.
"Autonomy and particularly autonomous fleets lend themselves really well to a vehicle-miles-traveled tax. It reduces one of the issues that people have about privacy, about having their own car tracked. If you’re going to hire Google or Uber or whoever to take you around in an autonomous vehicle you’re not going to have that expectation of privacy."
If a VMT tax can survive politically, it could prove a boon for governments, because electric autonomous vehicles are also expected to increase vehicle miles traveled overall, mostly because of empty trips they'll be taking instead of sitting idle in parking lots or garages.
"This will result in a lot less vehicles but a lot more VMT— vehicle miles traveled," Regan said. "How does that happen?"
Instead of sitting idle, the car is moving, sometimes empty, to its next trip. A single car can do the job of many cars because it doesn't wave to wait, parked somewhere, for its driver. But it's likely to cover more miles as it moves from job to job. Regan predicted a 50 percent increase in VMT in one scenario he outlined, with the vehicle empty one-third of the time.
Read More: 4 Surprising Side Effects Of Electric Autonomous Vehicles