New Electric Car Incentive Updates

David Roberts

Incentives remain an important motivator for many electric car buyers today. While plugging in can save thousands of dollars in fuel and maintenance over the life of the vehicle, many consumers still see higher purchase prices as a significant issue.

The Federal tax credit for plug-in electric vehicles (EVs) offers up to $7,500 to buyers but begins to sunset as individual automakers reach 200,000 U.S. EV sales. While there was hope that Congress would extend the availability of this program, it appears this did not happen in 2019. Tesla and General Motors passed the sales cap many months ago, triggering the 12-month phase out which ended for Tesla on December 31, 2019 and will be complete for General Motors on March 31, 2020. Nissan is the next in line to reach 200,000 sales – likely not to happen until sometime in 2021 or beyond at their current rate of EV sales.

Many states have stepped up to offer incentive programs that further reduce up-front costs for EV buyers and lessees, although funding limitations have constrained several northeast state EV incentive programs in the past few years, including the end and then re-launch of the Massachusetts program. On a more positive note, the State of Vermont launched a new EV incentive program on December 16, 2019 for low- and moderate-income households purchasing EV models with a base price under $40,000. Lower income households qualifying for home weatherization assistance are eligible for significantly higher incentives of up to $5,000.

The table provides summary information and links to details on financial incentives offered by states in the Green Energy Times distribution area.

States and municipalities may also offer non-monetary incentives, such as carpool lane access, reduced inspection fees, parking benefits and more.

Many electric utilities are also supporting EV adoption through purchase incentives and programs offering lower electric rates, discounted charging equipment, and other incentives to ensure the greatest benefits for their customers by shifting charging to off-peak hours. Check with your local provider to learn more about any current offers.

In relation to state incentive programs, there is potential for the multistate Transportation & Climate Initiative (TCI) to offer additional options to support transportation efficiency and electrification programs. TCI states recently shared details of a proposed program through a Draft Memorandum of Understanding now available for public review and comment. If the proposal advances, participating states will place a regional cap on transportation carbon emissions and will be able to leverage the proceeds of carbon allowance auctions to invest in programs and activities that reduce transportation emissions. This could include providing more sustainable funding for EV incentive programs moving forward. Additional details are available at https://www.transportationandclimate.org/.

TCI funding or development of other sources may require several years to implement, so if you are considering purchasing or leasing an electric car, your best option may be to take advantage of any current opportunities.

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