AB 620 adds Section 44274.16 to California's Health and Safety Code and instructs the State Air Resources Board (CARB) to consider a set of specified factors related to renting or sharing medium‑ and heavy‑duty (MHD) zero‑emission vehicles (ZEVs) whenever it adopts or amends regulations to implement the Medium‑ and Heavy‑Duty Zero‑Emission Vehicle Fleet Purchasing Assistance Program or any other regulation governing procurement or use of MHD ZEVs by public or private fleets. The statute does not mandate outcomes; it requires CARB to include these considerations in its regulatory analysis and rulemaking process.
This is primarily a rulemaking-direction bill: it signals legislative interest in rental and shared‑use models as tools to expand exposure to MHD ZEVs, increase flexibility for obligated fleets, and potentially ease supply‑chain constraints. For regulators and compliance officers, the immediate effect is procedural — rulemakings and regulatory impact analyses may incorporate new metrics, data collection needs, and policy options that treat rental/shared models as distinct pathways for fleet transition.
At a Glance
What It Does
The bill requires CARB to consider specified factors related to renting or sharing medium‑ and heavy‑duty ZEVs when adopting or amending regulations implementing the state fleet purchasing assistance program or any regulation on the procurement or use of MHD ZEVs by public or private fleets. The statute lists five areas CARB must weigh, from allocation of vehicle miles to supply‑chain and environmental benefits of rental versus purchase.
Who It Affects
This applies to CARB rulemakings that touch MHD ZEV procurement or use and therefore affects obligated fleet operators (public and private), rental and shared‑mobility providers of MHD ZEVs, vehicle manufacturers and lessors, and organizations that design or administer incentive programs under the Air Quality Improvement Program.
Why It Matters
By instructing CARB to treat rental/shared use as a distinct element of regulatory analysis, the bill opens the door for compliance pathways, incentive designs, or procurement rules that recognize short‑term rental or shared access as legitimate tools for accelerating ZEV deployment and managing supply constraints.
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What This Bill Actually Does
AB 620 inserts a single, focused direction into California's Health and Safety Code that changes how CARB approaches regulations connected to medium‑ and heavy‑duty zero‑emission vehicles. Rather than creating a new subsidy, procurement mandate, or compliance credit, the bill requires CARB to consider a set of policy-relevant factors about rental and shared‑use models whenever it writes or revises rules tied to MHD ZEV procurement or the state purchasing assistance program.
Those considerations cover who drives rental vehicles and who bears the miles and emissions, whether rental/shared models offer cost or flexibility advantages for obligated fleets, whether rentals help expose customers and operators to ZEV technology and charging options, the public‑health and climate effects of shifting vehicle miles from fossil fleets to ZEV rentals, and environmental or supply‑chain advantages of renting rather than buying vehicles.
In practice, that means future rulemakings will likely need to document how rental and shared‑use fleet strategies were evaluated. CARB may add questions to regulatory impact analyses, request additional data from fleet operators and rental firms, and consider policy tools that explicitly account for rentals — for example, allowing rental activity to count toward compliance obligations, shaping eligibility for grants or financing, or defining how vehicle miles and emissions are attributed between owners and drivers in program rules.
The bill leaves the choice of approach to CARB but pushes the agency to justify how it treated rental and shared models in its decision‑making.Operationally, the change creates both analytical and practical work for regulators and market participants. CARB will need defensible metrics for allocating miles and emissions, methodologies to compare lifecycle and supply‑chain impacts of renting versus buying, and clearer definitions of 'rental' and 'shared mobility' in the MHD context.
Rental and leasing companies may gain options under some regulatory designs but will also face scrutiny as data providers. Fleet managers who prefer owning vehicles should expect regulators to explicitly evaluate renting as an alternative during cost‑benefit and feasibility assessments, which could influence program eligibility, timing of incentives, or allowable compliance strategies.
The Five Things You Need to Know
Section 44274.16 requires CARB to consider rental/shared mobility when adopting or amending any regulation that implements the medium‑ and heavy‑duty ZEV fleet purchasing assistance program or any regulation governing MHD ZEV procurement or use by public or private fleets.
The statute lists five discrete consideration areas: allocation of miles/emissions to rental drivers, rental/shared mobility as a compliance tool for obligated entities, rentals as a technology‑exposure and education pathway, public‑health and climate effects of shifting VMT toward ZEV rentals, and environmental/supply‑chain benefits of renting versus procuring.
The bill applies to both public and private fleets and triggers on 'adopted or amended' regulations — so it affects new rulemakings and revisions to existing rules rather than only creating a standalone program.
AB 620 does not create new funding, credits, or procurement mandates; it imposes a procedural obligation to consider the listed factors during CARB rulemaking rather than to achieve specified outcomes.
Because the directive is to 'consider' rather than to 'require' or 'authorize,' its practical effect depends on how CARB incorporates these considerations into regulatory impact analyses, guidance, and final rule language.
Section-by-Section Breakdown
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Mandatory considerations for rental/shared MHD ZEVs
This is the bill's operative text. It enumerates five topics CARB must consider when it adopts or amends regulations related to the medium‑ and heavy‑duty ZEV fleet purchasing assistance program or other regulations covering procurement or use of MHD ZEVs. Because the statute is framed as a set of considerations, it creates a procedural duty in rulemaking records rather than substantive regulatory entitlements. Practically, agencies will need to show in notices, environmental analyses, or regulatory impact statements how they weighed each listed topic.
When the duty to consider applies
The provision applies whenever CARB adopts or amends regulations either (1) pursuant to the article that develops or implements the purchasing assistance program or (2) any other regulation concerning procurement or use of medium‑ and heavy‑duty ZEVs by public or private fleets. That means the provision covers program design documents, compliance pathway rules, grant or incentive eligibility rules, and potentially fleet procurement mandates — so it has broad reach within CARB's MHD ZEV rulemaking work.
The five specific factors CARB must weigh
The statute lists five focus areas: (a) that customers, not rental companies, drive rental vehicles and therefore bear miles-driven and associated emissions; (b) rental/shared mobility's potential to help obligated entities comply more cost-effectively and flexibly; (c) rentals' role in exposing customers to ZEV technology and charging infrastructure and educating them on benefits; (d) the public‑health, air quality, and climate benefits of reducing fossil‑fueled VMT or increasing ZEV VMT through rentals; and (e) environmental and supply‑chain benefits of renting versus buying. Each item directs CARB to include analysis on specific policy angles that could shape program eligibility criteria, compliance crediting, or nonfinancial supports.
Procedural instruction, not a mandate
The text tells CARB to 'consider' these factors but does not require any particular regulatory outcome, crediting approach, or changes to program spending. That procedural framing preserves agency discretion while making it harder for CARB to omit rental/shared considerations from economic or environmental analyses during rulemaking.
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Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Rental and shared‑mobility providers of MHD vehicles — The bill raises the chance CARB will treat rental activity as a legitimate compliance or program pathway, potentially expanding market opportunities and eligibility for incentives tied to usage.
- Obligated fleet operators seeking flexibility — Fleets with fluctuating demand or short‑term needs may gain more cost‑effective compliance options if regulators credit rental/shared access as an acceptable transition strategy.
- Communities with high diesel exposure — If CARB's consideration leads to programs that increase ZEV VMT via rentals in areas with heavy diesel use, locals may see faster air‑quality and health improvements in corridor hotspots.
- Vehicle lessors and financing entities — By foregrounding renting as a structural option, the bill could increase demand for leasing products and residual‑value services tailored to MHD ZEVs.
- Charging and infrastructure service providers — Broader use of rental ZEVs can produce clustered, high‑utilization charging locations that create new commercial opportunities for infrastructure developers.
Who Bears the Cost
- CARB and state regulators — Agencies will incur analytic and administrative costs to collect rental‑market data, develop attribution methodologies, and document how each consideration was treated in rulemakings.
- Smaller rental operators and independent lessors — New expectations for data sharing, tracking vehicle miles, or meeting performance criteria could impose compliance and reporting burdens on smaller firms.
- Fleet owners preferring ownership — Fleets that planned long‑term procurement to capture residual‑value benefits could face competition for incentives or be pushed into sharing/rental models the market favors.
- Program administrators and grant managers — If regulators expand eligibility or design new rental‑friendly incentives, administrators may need to redesign program rules, monitoring systems, and contract templates.
- Supply‑chain participants under short‑term demand pressure — If policy shifts favor rentals as a stopgap, manufacturers and parts suppliers may face unpredictable demand patterns complicating production planning.
Key Issues
The Core Tension
The central dilemma AB 620 creates is between accelerating ZEV exposure and flexibility through rental/shared models and the need for durable, predictable investments in vehicles, charging infrastructure, and supply chains that come from long‑term procurement — a solution that helps in the short run may undermine the investment stability required for the long run.
The bill's central practical effect is procedural: it forces CARB to account for rental/shared use in its rulemaking analyses. That sounds small but can be consequential because 'consideration' changes what questions agencies must ask, what data they request, and how they justify regulatory choices.
However, the statute leaves most material questions open. It does not define key terms (for example, what counts as 'rental' or 'shared mobility' for medium‑ and heavy‑duty vehicles), nor does it prescribe metrics for attributing vehicle miles or emissions between vehicle owners and drivers.
Those definitional and methodological gaps will determine whether the consideration leads to actionable policy changes or remains a tick‑the‑box exercise.
Another trade‑off lies between near‑term deployment speed and long‑term system optimization. Renting can accelerate exposure to ZEVs and alleviate immediate supply bottlenecks, but over‑reliance on short‑term vehicle turnover could complicate infrastructure planning (chargers sized for transient fleets vs. long‑dwell depot charging), vehicle maintenance chains, and lifecycle emissions accounting.
The bill pushes regulators to weigh those trade‑offs, but the absence of yardsticks risks inconsistent treatment across rulemakings and stakeholders. Finally, data quality and privacy are real implementation hurdles: tracking miles by vehicle and driver for regulatory crediting raises technical, commercial, and privacy questions that CARB and market participants will need to resolve.
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