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State Electric Car Incentives – Coming to Vermont Soon?

By David Roberts

Plug-in electric vehicles (EVs) are much more efficient than gasoline and diesel-powered vehicles and can be powered by renewably generated electricity. EVs can help clean up transportation, one of our dirtiest energy sectors, and help save money on gasoline and maintenance costs for owners. A range of state policies and incentives supporting EV adoption are developing as the numerous benefits of switching from gasoline to electric become clearer.

Many states are looking to give EVs a boost through their spending plans for their VW diesel settlement funds. States may spend up to 15% of their settlement proceeds on EV charging stations, with the remaining 85% available to help support heavy duty electrification of trucks and buses. In Vermont, members of the state legislature have introduced a bill (H. 682) which would direct the state’s beneficiary, the Agency of Natural Resources, to invest these settlement funds exclusively in electric-powered options.

For many individuals the cost of an EV remains the most difficult barrier to ownership. Federal, state and electric utility purchase incentives are helping bring down this cost. Many northeast states are among those offering EV purchase incentives, but a few have run out of funding for incentives or not offered them in the first place. The table shows more details on currently available state incentives.

201802_StateIncentivesTable

Vermont does not currently offer a state incentive, but two bills are under consideration in the Vermont House and Senate which could change that. These bills include several provisions related to EVs, including a sales tax waiver on EV purchases, added EV fees for highway infrastructure in lieu of gasoline taxes, planning for more charging infrastructure, and exploring ways utilities and regulators can help maximize the economic value of the transition to EVs for the grid.

The Senate bill (S. 271) calls for waiving the 6% state sales tax on the first $30,000 of an all-electric vehicle or the first $15,000 of a plug-in hybrid, reducing EV purchase costs by up to $1,800. The House bill (H.778) would completely exempt both types of electric cars from any sales tax.

The Senate bill also calls for imposing a supplemental registration fee on plug-in electric vehicles of $100 for all-electric vehicles and $50 for plug-in hybrids to make up for lost gasoline taxes. The proceeds of this fee would be split between transportation infrastructure funding and the state Clean Energy Development Fund to go toward building out more charging infrastructure.

The House bill takes a slightly different approach to making up for lost gas taxes by establishing a 1 cent per kilowatt hour surcharge on EV charging to be contributed into the transportation infrastructure fund starting in 2020. The bill would also support EV charging through a state income tax credit of up to $7,200 on a new charging station installation.

You can learn more about these bills and their status in the Vermont Statehouse at the links below, or by getting in touch with your legislator – especially if you’re interested in providing feedback on the proposed incentives, fees and studies.

https://legislature.vermont.gov/bill/status/2018/H.778

https://legislature.vermont.gov/bill/status/2018/S.271

David Roberts is the Drive Electric Vermont coordinator. He has driven an all-electric car for the past 5 years and says if you have to drive, drive electric.

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