In 2025, our industry’s approach to federal transportation electrification policy shifted from growth mode to defense mode. H.R. 1 pulled federal support back and sped up the sunset of several clean transportation programs and funding streams, creating real uncertainty. Despite Washington stepping away from electric vehicles (EVs), state legislatures across the country continue to pursue a transportation future that’s more efficient and economical.
The conversation also changed. EVs are not pilots anymore – one in ten cars sold in the United States in 2025 was fully electric. They are part of the transportation system, and systems have to work. Lawmakers spent less time setting adoption targets and more time dealing with the practical questions that come next: how to plan the grid, keep chargers working, fund roads fairly, keep costs low, and make sure people can benefit from the technology.
To build this digest, Advanced Energy United read and summarized hundreds of state legislative bills. What follows is a distilled look at the major legislative themes that defined EV policy in 2025.
- Transportation Electrification Planning
- Alternative Fuels
- Electric School Buses and Public Transit
- Electric Micro-Mobility Devices
- Fees and Taxes on EVs and Charging
- Financial Incentives and Funding
- Workforce Development and Labor
- Charging Infrastructure
- Multi-Unit Dwellings and Building Codes
- Electric Vehicle Batteries
- Vehicle-To-Grid Integration
- NEVI Corridor Buildout
Transportation Electrification Planning
As electric vehicles become a growing share of vehicles on the road, states are increasingly focused on planning electrification as a core transportation and energy system. In 2025, legislatures advanced policies that formalize transportation electrification (TE) planning, clarify agency responsibilities, and integrate EV considerations into long-term infrastructure and grid planning.
California’s Local Electrification Planning Act represents a significant step in this direction. The law requires cities and counties to develop and/or update local electrification plans that address EV charging infrastructure, building electrification, distributed energy resources, and the grid upgrades needed to support them. By embedding electrification planning into general plans, the state ensures that EV readiness becomes part of routine decision-making rather than an ad hoc or project-by-project consideration.
Illinois advanced TE planning through the Clean and Reliable Grid Affordability Act. The law aligns EV development with utility planning requirements, reinforces coordination between environmental and energy agencies, and recognizes transportation electrification as a driver of long-term load growth that must be proactively managed through planning rather than reactive upgrades.
Washington amended the Clean Energy Transformation Act, directing utilities to account for electric vehicle adoption and charging infrastructure in system planning and investment decisions.
Alternative Fuel Vehicles
Alongside major progress on EVs, several states in 2025 updated their laws to support cleaner fuels that reduce reliance on gasoline and diesel. Arizona’s SB1274 updates the state tax code for vehicles converted to run on alternative fuels. California extended tax exemption on hydrogen sold for fuel-cell vehicles in SB419; and Illinois’ HB2394 allows battery-electric and hydrogen vehicles to exceed normal vehicle weight limits by up to 2,000 pounds.
Electric School Buses and Public Transit
In 2025, many states focused on public fleets, such as school buses and transit vehicles, as part of grid planning, not as isolated purchases.
Virginia’s HB2346 creates a statewide virtual power plant pilot program that brings school buses into long-term grid planning. Utilities must propose pilots that aggregate distributed energy resources and test how they reduce peak demand. By 2027, utilities must also submit a broader electric school bus program as part of grid transformation filings.
Washington's SB5009 updates student transportation funding rules. Districts must now report vehicle types, students served, and fuel costs. The law directs the state to prioritize zero-emission school buses when their total cost of ownership is equal to or lower than diesel.
For public transit electrification, California’s SB71 streamlines approvals for planning and infrastructure that support zero-emission and low-emission fleets. It also exempts qualifying projects related to charging, refueling, and maintenance for buses, trains, and ferries.
Electric Micro-Mobility Devices
Alongside work on cars, buses, and trucks, many states have continued to give their attention to electric bicycles, scooters, and other small electric vehicles. These devices have become a routine part of daily transportation, and states are updating basic rules to reflect that reality.
California, Colorado, Delaware, Kentucky, Missouri, and Montana all passed laws to clarify how electric bicycles, scooters, and similar vehicles are defined, sold, labeled, and used. Most of these policies focus on safety, age limits, helmet requirements, speed controls, and clear labeling, so riders, parents, law enforcement, and retailers understand what is allowed.
Rather than expanding enforcement or creating new barriers, these bills mostly aim to make micro-mobility safer, simpler, and easier to manage as it grows.
Fees and Taxes on EVs and Charging
As EVs become more common, many states spent 2025 trying to solve an old problem with a very blunt tool. Revenue from gas taxes has been eroding for decades. Combustion engine cars are more fuel-efficient. Many states have not updated their gas tax rate nor tied them to inflation. Construction costs keep rising. Instead of modernizing that system, in 2025 lawmakers once again turned to registration fees on EVs as the patch.
In many states, EV owners now pay more in combined fees and taxes than gasoline drivers, even though they cause the same wear on the roads. Flat registration surcharges, per kilowatt hour taxes at chargers, and multiple stacked fees create a penalty for driving electric. It does not fix the revenue problem. It simply shifts blame onto a small, visible group of early adopters.
The bills in 2025 show this pattern clearly.
Indiana’s HB 1380 keeps existing supplemental registration fees for electric and hybrid vehicles in place and only carves out very light vehicles under 60 pounds. Washington’s SB 5801 increases EV registration and transportation electrification fees and ties future increases to inflation. Utah’s SB 0027 locks in EV-specific add-on fees for drivers who do not participate in the road usage charge program and sets new surcharges for hybrid and plug-in hybrid vehicles. Vermont’s H0488 raises registration fees on plug-in hybrids as part of its broader transportation program.
Other states focused on charging itself. Minnesota’s HF 14 creates a tax on electricity delivered at public EV chargers while also adjusting existing EV surcharges. Montana’s SB 228 requires metering at all public and legacy charging stations and imposes a three cent per kilowatt hour tax, even as it reduces EV registration fees beginning in 2028. Georgia’s HB 652 takes a narrower path, exempting only certain nonprofit, no-cost chargers along interstate corridors, while keeping most other charging taxable.
A few states started to look past blunt EV fees toward a more stable framework. Oregon’s HB 3991 phases in a mandatory per mile road usage charge for electric, hybrid, and plug-in hybrid vehicles beginning in 2027 and sunsets the voluntary program. Vermont’s H0488 directs the Agency of Transportation to design and begin collecting a mileage based user fee for battery electric vehicles by mid-2026. Utah’s SB 0195 updates how its own mileage based program works, clarifying who can enroll, how charges are capped, and how privacy and billing are handled.
A better path is already on the table. As laid out in Advanced Energy United’s “Rethinking Road Funding in the Age of EVs,” sustainable systems should avoid double taxation, right-size any temporary EV fees, and transition toward mileage-based models that reflect actual road use while indexing fuel taxes so they do not quietly disappear.
Financial Incentives and Funding
H.R. 1 removed significant federal support for clean transportation, creating uncertainty around programs that many states had relied on. In 2025, that uncertainty did not translate into a wholesale retreat from incentives. Instead, most EV and charging support continued through existing state programs, utility-administered rebates, and executive budget decisions rather than through major new legislative action. The bills passed this year signal how states chose to respond at the margins of that broader continuity.
A small group moved to eliminate support. Arkansas’s SB 416 repeals the state’s Electric Vehicle Infrastructure Grant Program and its dedicated fund. The state also passed SB 267 which repeals the Alternative Motor Fuel Development Act and ends rebates tied to alternative fuel infrastructure and vehicle conversions.
Other states used legislation to reinforce or protect existing incentive frameworks, even as federal funding became less certain. California’s SB 127 preserves funding authority for clean transportation programs, including zero-emission truck and bus incentives and charging infrastructure. Hawaii’s SB 1008 adds rebates for EV-ready parking in affordable housing. Maine’s LD 1258 expands eligibility for EV incentives and clarifies equity requirements for e-bike incentives. New Jersey’s S3189 strengthens investment tax credits that include transportation-related electronics. Vermont’s S0123 continues funding for EV and charging programs, including vehicle incentives and support for multifamily and workplace charging.
Viewed together, these bills do not define the full incentive landscape for 2025. Instead, they show where states chose to codify continuity, narrow existing support, or signal longer-term intent, while most incentive activity continued through budgets and utility programs already in place.
Workforce Development and Labor
As states build out transportation electrification, lawmakers also turned to the people and companies doing the work.
Arkansas’s HB 1683 bars state agencies from buying electric vehicles or components unless manufacturers certify that no part of production involved forced labor.
New Jersey’s A 5687 creates the Next New Jersey Manufacturing Program, offering tax credits to manufacturers that invest at least ten million dollars and create new full-time jobs in the state. Transportation-related infrastructure improvements can count toward those investments, tying job growth to clean transportation buildout.
Washington’s SB 5528 requires that EV charging equipment installed at state-funded facilities be handled by workers trained through the Electric Vehicle Infrastructure Training Program or an equivalent program.
Charging Infrastructure
In 2025 states focused less on the number of chargers and more on charger reliability and access. California’s AB1423 sets uptime expectations, requires reporting, and allows penalties when stations stay out of service. Hawaii’s SB589 requires real-time public data on charger status and availability through a standard API, while Kansas’ HB2255 brings EV chargers under weights-and-measures rules, with annual testing and removal from service when equipment is inaccurate. New Jersey’s A3035 keeps charging spaces reserved for vehicles that are actively charging, and New York’s S787 ensures at least one wheelchair-accessible charging space at each site.
States also continued refining how drivers pay for charging and install it at home. California’s SB533 allows certain chargers to use app-based payment systems while preserving consumer protections, and SB770 removes unnecessary liability insurance barriers for residents installing chargers in shared housing.
At the same time, legislatures worked to clarify the basic rules of the charging market. Colorado’s HB1267 authorizes statewide standards for retail charging equipment and sales practices, and South Carolina’s S275 confirms that charging providers are not electric utilities while allowing utilities and co-ops to support make-ready investments on fair terms. Hawaii’s SB1009 strengthens enforcement for blocking charging spaces or parking without charging, reflecting a growing focus on everyday use and access.
Multi-Unit Dwellings and Building Codes
States also kept chipping away at a large barrier to EV adoption: installing infrastructure in harder-to-reach segments like commercial buildings and residential multi-unit apartment and condo buildings.
In Maine, LB1133 requires condominium and residential associations to stop blocking residents from installing charging in their own parking spaces. Associations can still set reasonable standards and require owners to pay the costs, carry insurance, and maintain the equipment, but blanket bans are no longer allowed.
New York’s S00801 directs the state’s energy conservation code to require EV-ready parking and charging in new buildings with off-street parking once future codes take effect. The Building Code Council will set the numbers by building type, with attention to access and practicality, and allow exemptions where EV wiring is technically infeasible or where affordable housing would be burdened.
Electric Vehicle Batteries
States are beginning to treat battery recycling not as an afterthought, but as their own public safety and lifecycle challenge. California’s AB875 adds provisions on vehicle removal as well as directs the State Fire Marshal to convene a statewide advisory group focused on lithium-ion vehicle batteries in emergencies. The group will study fires, collisions, submerged vehicles, and other high-risk scenarios, then develop clear standards for first responders by 2028.
Hawaii is looking further down the line at what happens after a battery’s useful life. HB242 creates a working group to map out how EV batteries can be reused, repurposed, or recycled safely and cost-effectively. The work includes storage applications, costs, environmental risks, and whether processing should happen in-state or out-of-state.
Vehicle-To-Grid Integration
States are starting to recognize that electric vehicles are not just loads on the system. They are mobile batteries that can support reliability, lower peak demand, and help reduce costs for everyone if programs are designed well. The next step is building fair compensation structures and clear rules so EVs and other distributed resources can actually provide those services.
Washington’s HB1409 requires that by 2026, the Utilities and Transportation Commission must open a proceeding to figure out how utilities can run programs that allow cars and trucks to both charge and send power back, how customers are paid, how interconnection works, and how to keep nonparticipants whole. Utilities must then file program proposals by 2027.
This is part of a larger pattern. States are beginning to organize distributed resources into virtual power plants and to pay them for real grid services. Illinois SB0025 requires certain storage and solar systems to enroll in dispatchable VPP programs. Virginia HB2346 launches a statewide VPP pilot to test how aggregation can reduce peak demand and improve reliability. Washington’s bill does not create a VPP program on its own, but it builds the policy scaffolding so EVs can participate as grid assets rather than sitting unused during times of system stress.
NEVI Corridor Buildout
This year’s digest wouldn’t be complete without mentioning the National Electric Vehicle Infrastructure (NEVI) Formula Program. While it isn’t a state bill, the ups and downs of NEVI in 2025 had a real impact on state charging networks and the timing of corridor deployment.
In February 2025, the Federal Highway Administration rescinded the NEVI Formula Program Guidance and suspended approvals of state plans, effectively pausing the obligation of new NEVI funds nationwide. In May 2025, at least 16 states and the District of Columbia sued, challenging that pause as unlawful. On June 25, 2025, a federal judge issued a preliminary injunction lifting the freeze on an initial tranche of funding — a first step toward restoring NEVI plan approvals and money distribution. On August 11, 2025, the Department of Transportation released updated interim NEVI guidance, allowing states to resubmit deployment plans and unfreeze remaining funds that had been withheld since February.
By late 2025, 42 states had approved FY26 NEVI plans, and nine of those had reached fully built-out status on key Alternative Fuel Corridors with enough chargers to support long-distance electric travel. Across those approved plans, states and partners have awarded over 4,000 DC fast charging ports under NEVI allocations.
NEVI’s journey this year illustrates how persistent state leadership kept momentum alive even when federal guidance paused. As one of the few truly national pieces of EV infrastructure policy, it provides a backbone for long-distance charging while state legislatures and agencies work on reliability, payment systems, building codes, equity, and grid integration.
What We Expect in 2026
In 2026, we expect states to keep moving from EV promotion to EV integration. The work ahead is about planning, pricing, and using EVs as part of the power system.
Affordability will drive many of these debates. Policymakers are hearing real concerns about electricity bills, charging costs, and the stacking of EV fees. Some states have responded by adding new costs to EV ownership. That approach misses the point. EVs can help keep rates stable if they are enrolled in programs that manage charging, support the grid during peak hours, and pay drivers for the grid services their vehicles can provide.
In 2026 we expect more attention to virtual power plants and vehicle-to-grid programs. These tools treat EVs as flexible resources that can shift demand, store energy, and reduce the need for expensive grid upgrades. When states design these programs well, everyone benefits: EV drivers get paid, utilities avoid higher capital costs, and non-EV customers see lower pressure on rates as well.
That only works with solid planning. We expect states to push utilities to forecast EV growth accurately, modernize interconnection processes, publish clearer data, and build charging infrastructure into routine grid planning. The goal is to avoid reactionary policies that blame EVs for rate increases and instead build systems that pull value out of them.
Road funding will also stay active. We’ll likely see continued experimentation with fee structures and mileage-based pilots. The trend we hope to see is fairness: avoid stacking charges on EVs simply because they are new and focus on contributions tied to use.
Put simply, 2026 is shaping up to be a year where states decide whether EVs are treated as a cost to manage or an asset to harness. The policies we expect to see suggest more leaders are moving toward the latter, using EVs to improve the grid, stabilize rates, and make the transition cheaper for everyone.