California Looking at Massive EV Incentive Increase

The government of California is looking at giving electrified cars a $3 billion financial boost including an attractive cash-on-the-hood incentive for plug-in car buyers.

California has long had problems with air pollution and is home to seven of the 10 U.S. cities with the most severe air pollution. It’s why the state has long been on the leading edge of first emissions controls, and then later electric vehicles.

Since 2010, the state has spent nearly half a billion dollars on consumer rebates, but of a vehicle fleet numbering 26 million, only around 315,000 are electric or plug-in hybrids. So the government is looking at better incentives to bring the price of entry for electric cars down. Way down.

The plan is to establish a declining rebate program that will bring the price of a compact EV down to the same effective price as a common compact car. If the program hits sales targets, the rebate will gradually reduce to zero. By that point, the assumption is that sales will be self sustaining.

The target is for one million zero-emission vehicles on the road by 2022, with Governor Jerry Brown having an additional target of 1.5 million by 2025 and five million by 2030.

The new proposal is for a point-of-sale rebate, not the current tax rebate that requires the buyer to fill in forms and wait to get the credit. That step is intended to boost sales with low-income buyers, who often can’t afford to wait for a later credit. The bill also calls for the promotion of the benefits to the electrical grid of increased EV use.

The bill has been approved by state Senate and Assemby committees, but still requires full Legislature approval. If the bill receives that approval by September 15, the end of the current legislative session, it will go to Governor Brown for approval.


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