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California boosts electric car rebates for low-income families

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Robert Galbraith/Reuters/File

(Read caption) An attendee looks over a BMW i3 electric car at the Electric Power Research Institute's Plug-In 2014 conference in San Jose, California. The Golden State is changing its Clean Vehicle Rebate Program so that incentives are based on income.

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Until now, the California Clean Vehicle Rebate Program offered incentives of $1,500 for plug-in hybrids, and $2,500 for electric cars.

Now, lower-income households will be able to get substantially more money for certain models.

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Those with incomes less than 300 percent of the Federal Poverty Limit will now be able to get up to $3,000 for a plug-in hybrid, $4,000 for an electric car, and $6,500 for a hydrogen fuel-cell car.

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At the same time, buyers with incomes over $250,000 will no longer be eligible for incentives on plug-in hybrids or electric cars.

However, these buyers still qualify for a $5,000 rebate on hydrogen fuel-cell cars.

This change in policy will primarily affect Tesla Motors, whose lineup starts at $75,000 this year.

From data gathered to date, it appears higher-income buyers are getting the majority of California rebates.

A survey from the second quarter of 2015 shows that about three quarters of rebates went to households earning more than $99,000 a year.

Those with incomes above $200,000 a year accounted for 26 percent of total rebates, while those with income under $99,000 represented 27 percent.

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According to the California Air Resources Board, changes were made to direct the plug-in purchase incentives "towards those most likely to value the rebate the most."

For the 2015-2016 fiscal year, which began July 1, the Clean Vehicle Rebate Program also got a boost in funding, from $121 million to $163 million.

The program has issued $217 million in rebates since 2010.