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California May Cap Electric Vehicle Incentives for the Wealthy

If you can afford a $100,000 electric vehicle, do you need a rebate?
If you can afford a $100,000 electric vehicle, do you need a rebate?

Depending on how you look at it, electric vehicle incentives may be a waste of money or a boon to the industry, and isn’t as equitable as it could be, at least according to California Senator Kevin de León.

Compared to conventional vehicles, electric vehicles have a couple of limitations that make some potential buyers stop and think twice and, in thinking twice, are often swayed back to conventional vehicles. Incentive programs, such as the federal electric vehicle tax rebate of $7,500, state tax rebates up to $7,500, and other perks, such as free HOV lane access, make electric vehicles a more attractive option. Still, considering the upfront pricing of electric vehicles and charging stations is higher, many in the middle class, who could buy an electric vehicle, still find it out of their reach. The wealthy, on the other hand, who’d buy a $50,000 or $100,000 car anyway, don’t really need an incentive, do they? After all, many Tesla Model S owners bought theirs, not because they are concerned about the environment or access to the HOV lane, but because the Tesla Model S is the latest and coolest technology on the road. Also, nothing says prestige like driving around in a $100,000 car.

California Senator Kevin de León believes that electric vehicle incentives could be a little more equitable if rebates were skewed more toward the middle class. Considering the California goal to have a 15% electric vehicle fleet by 2025, encouraging the middle class to adopt the new technology would be a huge step toward that goal. In fact, if it weren’t for finances, the UCS (Union of Concerned Scientists) suggests that millions could get into electric vehicles with no change in driving habits. To make it easier, de León has already managed to pass the Senate, would increase electric vehicle incentives to the middle class, including up to $1,500 in rebates, for trading in a gas guzzler, and up to $3,000, for purchasing an electric vehicle. The law, if passed, would limit these incentives for the wealthy. Will such a plan really enable the middle class to adopt electric vehicles?

Photo credit: rblock

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