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USPS OIG – Fleet Modernization – Electric Vehicle & Charging Infrastructure Incentives

June 28, 2024

READ FULL ARTICLE AT » Office of Inspector General OIG

Background

To manage its aging fleet while supporting financial and environmental sustainability strategies from its 10-year Delivering for America plan, the Postal Service is investing $9.6 billion to electrify its delivery vehicles and install related charging infrastructure at hundreds of facilities. As $3 billion of this investment stems from congressional funds, it is essential for the Postal Service to capture cost savings as it executes its strategies to further strengthen the financial sustainability of this critical public service. Accordingly, the Postal Service has opportunities to leverage a wide range of financial incentives (from government agencies, utility companies, and carbon markets) that encourage the transition to electric vehicles.

What We Did

Our objective was to determine if the Postal Service is participating in incentive programs related to its electric vehicles and requisite charging infrastructure. If not, identify opportunities for participation and associated cost savings. We engaged a contractor to identify incentive programs and carbon markets that the Postal Service is eligible for at 29 facilities slated for electric vehicle deployment in fiscal year (FY) 2024.

What We Found

We found that the Postal Service did not participate in incentive programs related to electric vehicles and requisite charging infrastructure. We identified 13 available incentive programs the Postal Service may be eligible to participate in at 14 of 29 facilities. Further, we identified seven incentive programs across seven facilities that were available during our review, but eligibility has since ended. Postal Service management stated it did not continue to pursue incentive programs, at the direction of leadership, but rather prioritized the implementation of Sorting & Delivery Centers to drive revenue. If the Postal Service were to participate in these incentive programs and carbon markets, it could potentially gain an estimated $5.48 million in funds put to better use. For the seven programs it is no longer eligible to participate in, it could have obtained $3.23 million in increased revenue. Further exploring the feasibility of participating in these programs may provide additional cost savings and revenue opportunities as the Postal Service executes its electric vehicle deployment plans to 800 facilities by the end of FY 2028.

Recommendations and Management’s Comments

We made two recommendations to evaluate the incentive programs identified for existing planning processes and for incorporating continuous monitoring for the future. Postal Service management agreed with the finding and one recommendation and disagreed with the other one. Management’s comments and our evaluation are at the end of the finding and recommendations. The U.S. Postal Service Office of Inspector General (OIG) considers management’s comments responsive to recommendation 1 and corrective actions should resolve the issues identified in the report.

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