California considers tripling EV subsidies

The state of California could soon triple the subsidies for zero-emissions cars while cutting those for hybrids. This means buyers in the Golden State could get as much as $7,500 per EV. However, the Senate has yet to approve the draft bill.

+ + Kindly see our update below + +

The bill with the abbreviation AB1046 by democratic delegate Phil Ting provides for buyers of battery electric and fuel cell cars to receive up to 7,500 dollars per vehicle. Hybrids, on the other hand, could end up empty-handed. Ting said, according to the San Francisco Chronicle, that discounts could be quickly increased to boost demand for the vehicles.

The existing rebate program grants buyers of electric cars a lump sum of $2,500 – but this is no incentive for Ting to drive electrically in the coming years. Since the state is not on the way to achieving its goal of reducing greenhouse gas emissions, it must take action to increase sales of climate-friendly cars. A report by the State Air Resources Board last year had identified rising car emissions as the main reason for the state’s problem.

According to Dan Sperling, member of the California Air Resources Board, the law would remove another obstacle: Currently, funding for discounts on electric cars runs out every fiscal year. Once the funds are used up, buyers have to wait until the state releases new funds. According to Sperling, this has led car dealers, among others, not to mention the discount program to customers – because it was not certain whether the customers would also receive the money. However, the draft stipulates that the state should finance the rebates on a permanent basis.

The draft is about to be heard by the Transport Committee of the Senate. It will then have to be submitted to the entire Senate – the outcome unclear. Furthermore, the bill does not provide any support for plug-in hybrids, which have so far received a discount of 1,500 dollars. Ting said he saw no need to subsidise the “intermediate technology” in the future, as the cars would not have large ones.

It is not only California showing movement towards a turnaround: 23 states have called on US President Trump to abandon his proposal on fuel efficiency in cars. Trump plans to freeze consumption standards at the 2020 level by 2026 – and without stricter targets not to create an incentive to switch to more fuel-efficient vehicles. Note: The 23 states also include important campaign areas for the 2020 presidential election – such as Pennsylvania and Wisconsin.

According to Reuters, these states represent 52 per cent of the population and 57 per cent of the economy. They demand “a continuous, significant annual reduction in greenhouse gas emissions and pollutant criteria, while saving consumers’ money,” and “maintaining state authority to protect our environment”.

Update 12.09.2019: The plan to triple state subsidies for BEV and FCEV in California has been halted. The bill has just been rejected by the Finance Committee. Democrat MEP Phil Ting, who initiated the bill, is not giving up and will resubmit the bill or introduce the measures as part of the state budget next year.

Despite the setback, Ting said he has convinced Governor Gavin Newsom’s administration to implement a key aspect of the bill; to undertake a study to determine how the rebate program can be worked to enable California to achieve its stated goal of getting 5 million zero-emission vehicles on the road by 2030. There are currently 600,000.

Other problems addressed by Ting’s bill will remain for the time being – such as the fact that funding for zero-emissions vehicles (BEV and FCEV) rebates run out every year so that those wanting to buy these vehicles have to wait until more funding is authorised.

sfchronicle.com, reuters.com, sfchronicle.com (update)