How New Federal and State Clean Transportation Policies Could Impact Michigan Fleets

Shifting Federal Priorities: What Michigan Fleets Need to Know

Since the beginning of 2025, there has been a significant shift in federal clean transportation policies, considering the new administration’s “Unleashing American Energy” executive order. This sequence marks a drastic turn from an emphasis on electric vehicles (EVs) and greenhouse gas (GHG) rules of the last administration. Given that Michigan is home to America’s largest automotive sector, this policy change will significantly affect the state and transportation as a whole.

Manufacturers and fleets operating in Michigan are unsure about the Trump Administration’s intention to revoke California’s waivers for zero-emission vehicle (ZEV) rules and possibly the EPA’s rights to control greenhouse gases. Should these waivers be revoked or undermined, Michigan fleets could be subject to less federal-level requirements guiding their shift to ZEVs. However, manufacturers and suppliers with Michigan-based operations investing in EV and clean tech development may suffer repercussions from the legislation change.

Given that Michigan is home to America’s largest automotive sector, this policy change will significantly affect the state and transportation as a whole.

State-Level Action: Michigan's Response to National Uncertainty

Even while federal policies shift, Michigan’s state legislation may continue supporting EV transportation initiatives. Given federal rollbacks, several states are likely to rely more on state rules, incentives, and budgetary allocation rather than federal standards. Considering its unique position in the automotive industry and its support by alliances with utilities and public bodies, Michigan has demonstrated leadership in supporting advanced automotive technologies and renewable energy.

The state is involved in multiple clean transportation funding programs, which offer millions annually through various grants and rebates. Michigan’s utilities and agencies have historically supported infrastructure development for electric and alternative fuel vehicles; there is little indication this will change. If federal programs see cuts, Michigan may further prioritize state-level incentives to fill funding gaps and attract economic growth stimulated by the trend in sustainable transportation.

Federal Funding Risks: How Michigan Programs Could Be Affected

The Trump administration is reviewing several major federal funding programs implemented under the Biden administration—such as the Clean School Bus (CSB) Program, National Electric Vehicle Infrastructure (NEVI) Program, and the DOE Hydrogen Hubs. Many of these programs have not fully allocated funds; as a result, future rounds of funding are at risk of being paused or redirected.

“EV projects could continue without disruption at a time when over 100 fleet managers in Michigan are not interested in buying EV school buses due to reliability issues”

According to interviews done by the Michigan Propane Gas Association

For Michigan, which has benefited from these grants to modernize school bus fleets, expand EV infrastructure, and support hydrogen development, this could mean delayed or reduced access to resources crucial to continue modernizing public transportation. However, previously contracted awards for this initiative are at less of a risk. Therefore, “EV projects could continue without disruption at a time when over 100 fleet managers in Michigan are not interested in buying EV school buses due to reliability issues,” according to interviews done by the Michigan Propane Gas Association.

Long-Term Market and Legal Impacts in Michigan

Manufacturers and Michigan fleets will continually monitor legal challenges regarding dismissing California waivers and greenhouse gas rules in the long term. With the Supreme Court reversing the Chevron Doctrine in 2024, in which courts are no longer obligated to defer to a federal agency’s interpretation of the law, courts now must assess Congressional intent more narrowly. The repercussions of this will likely result in some restrictions on federal regulatory authority.

Conclusion

For Michigan, the 2025 sustainable transportation plan offers both benefits and risks. Although federal-level rollbacks could slow down national ZEV adoption and diminish funding certainty, Michigan’s strong automotive industry, state incentives, and local leadership offer methods to handle the changing terrain. Fleets and manufacturers have to be agile to correctly plan using state programs and tracking of federal court judgments.

References:

Fuel Type	Light Duty	School Buses	Paratransit	Single Unit Short-Haul Truck	Single Unit Long-Haul Truck
Propane	$60,000	$140,000	$48,000	$104,000	$89,000
Electric	$93,000	$410,000	$93,000	$250,000	$185,000
Diesel	$63,000	$138,000	$53,000	$90,000	$75,000
Gasoline	$52,000	N/A	$42,000	$90,000	$75,000

	Propane	Gasoline	Diesel	Electric
Chemical Structure	C3H8 (majority) and C4H10 (minority)	C4 to C12 and Ethanol ≤ to 10%	C8 to C25	N/A
Fuel Material (feedstocks)	Fats and oils from sources such as soybeans, waste cooking oil, animal fats, and rapeseed	Crude Oil	Crude Oil	Natural gas, coal, nuclear, wind, hydro, solar, and small percentages of geothermal and biomass
Gasoline or Diesel Gallon Equivalent (GGE or DGE)	1 gal = 0.74 GGE 1 gal = 0.66 DGE	1 gal = 1.00 GGE 1 gal = 0.88 DGE	1 gal = 1.12 GGE 1 gal = 1.00 DGE	1 kWh = 0.030 GGE 1 kWh = 0.027 DGE
Energy Comparison (GGE = Gasoline Gallon Equivalent)	gallon of propane has 73% of the energy in 1 GGE due to the lower energy density of propane.	1 gallon of gasoline has 97%–100% of the energy in 1 GGE. Standard fuel is 90% gasoline, 10% ethanol.	1 gallon of diesel has 113% of the energy in 1 GGE due to the higher energy density of diesel fuel.	A typical battery that is the same size as a gallon of gas (0.134 ft3), when used for transportation, can store 15.3% of the energy in 1 GGE. [6][7]
Energy Content (lower heating value)	84,250 Btu/gal (c)	112,114– 116,090 Btu/gal (c)	128,488 Btu/gal (c)	3,414 Btu/kWh
Energy Content (higher heating value)	91,420 Btu/gal (c)	120,388– 124,340 Btu/gal (c)	138,490 Btu/gal (c)	3,414 Btu/kWh
Physical State	Pressurized liquid (heavier than air as a gas)	Liquid	Liquid	Electricity
Cetane Number	N/A	N/A	40–55 (d)	N/A
Pump Octane Number	105 (g)	84–93 (f)	N/A	N/A
Flash Point	-100° to -150°F (j)	45°F (j)	165°F (j)	N/A
Autoignition Temperature	850° to 950°F (j)	495°F (j)	~600°F (j)	N/A
Maintenance Issues			Lubricity is improved over that of conventional low sulfur diesel fuel. For more maintenance information see, the Biodiesel Handling and Use Guidelines—Fifth Edition. (d)
Energy Security Impacts	Approximately half of U.S. LPG is derived from oil, but no oil is imported specifically for LPG production.	Manufactured using oil. Transportation accounts for approximately 30% of total U.S. energy needs and 70% of petroleum consumption. (l)	Manufactured using oil. Transportation accounts for approximately 30% of total U.S. energy needs and 70% of petroleum consumption. (l)	Electricity is produced domestically from a wide range of sources, including through coal-fired power plants and renewable sources, making it a versatile fuel.

Fuel Type	School Buses
Propane	$108,000
Electric	$300,000
Diesel	$100,000
Diesel HEV	$160,000
CNG	$130,000
Gasoline

Chassis	7.3L Version	GVWR	0.05 NOx
E-350	Premium	10,050	N/A
E-350	Economy	10,050	N/A
Economy	E-450	14,000	N/A
Premium	E-450	14,200	Yes
E-450	Premium	14,500	Yes

How New Federal and State Clean Transportation Policies Could Impact Michigan Fleets

Shifting Federal Priorities: What Michigan Fleets Need to Know

State-Level Action: Michigan's Response to National Uncertainty

Federal Funding Risks: How Michigan Programs Could Be Affected

Long-Term Market and Legal Impacts in Michigan

Conclusion

School buses

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Fleet usage of propane in sectors optimal for
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