Earlier this month, a group of utilities, including Edison Electric Institute and the National Rural Electric Cooperative Association, wrote to Congress to ask for an extension of the federal electric vehicle (EV) tax credit. The existing tax credit of up to $7,500 (determined based on each vehicle’s traction battery capacity and the gross vehicle weight rating) is to be phased out as sales increase. The phase out will begin for each manufacturer once that manufacturer sells 200,000 qualifying electric vehicles for use in the United States, which according to the letter, will likely be this year for many manufacturers, particularly Tesla and General Motors.
The group of utilities state that the credit “is essential to foster the rapid adoption and deployment of electric vehicles, which in turn will boost our economic and national security and continue to create the next generation of well-paying American jobs.” Further, they “look forward to a time when EVs may help support grid services, the integration of renewable resources or demand response, thereby enhancing the efficiency of the electric grid.”
The credit was on the chopping block at the end of last year, but was ultimately preserved. It does not appear that last week’s omnibus removed the cap, as the utilities group had requested.
A Department of Energy site maintains a list of eligible vehicles and the status of any phase outs. States may also offer different incentives for purchasing EVs (search by state here or check out Tesla’s roundup).