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Electric Vehicle Fees Charged in 10 States


An electric Ford is chargedOne of the basics of economics is that when something is more expensive, fewer people will buy it, and if something else is cheaper, more people will buy it.

This principle can be applied to anything, like handbags, appliances, even vehicles. Right now, 10 U.S. states are making that ‘something’ an electric vehicle – by imposing fees on ownership. These electric vehicle fees vary, but can be as much as $300 (depending on personal or commercial use).

On the surface, a fee makes sense. As the U.S. Department of Energy states, maintenance of road infrastructure is traditionally funded by a combination of federal and state taxes collected at the pump when buying fuel. Since electric vehicles don’t refuel at pumps that collect taxes, they don’t contribute to these funds. Therefore, electric vehicle fees would help recoup this difference.

However, modern electric vehicle ownership is minimal compared to gasoline and diesel vehicles. At this point in time, more should be done to increase electric vehicle ownership, not less.

By encouraging purchase, more can be done by carmakers to get to the next stage of the product’s life cycle. Lower prices, longer driving distances and more mainstream appeal would all be positive outcomes of increased purchasing. By improving the electric vehicle, it would also be a step forward in trying to reduce the reliance on fossil fuels.

With green cars not accounting for much share of the roads at all, it’s difficult to see that these electric vehicle fees would help raise money for infrastructure. Penalizing positive behavior (e.g. trying to ease dependency on other fuels) with a fee may cause would-be electric vehicle buyers to reconsider.

Two common suggestions to collect funds for infrastructure include increasing the tax on fossil fuels, or charging fees to vehicles that wear the most on roads, e.g. heavy trucks.

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