Originally published on Gas2.
California is about to begin testing a new “point of sale” clean vehicle rebate plan in San Diego. Under the present rules, people who purchase a qualifying EV can get a check back from the state for up to $7,000, depending on their income level. California started indexing its rebate program to income level a few years ago to avoid the charge that the incentives the state was offering were mostly benefiting wealthy tech tycoons and Hollywood stars replacing their Porsches with Teslas. The state is much more interested in encouraging low-income families to give up their inefficient and pollution-belching commuter cars and drive a low- or zero-emissions (and far safer) car instead.
The problem with the current system is that the customer must first buy the car and pay for it before the rebate check goes in the mail. A point of sale plan would lower the purchase price of the car immediately and lower the monthly purchase payment right from the get go. Customers would pre-qualify for the rebate by submitting their income information in advance and getting their level of eligibility determined before they go shopping for a new vehicle.
Current data indicate only 70% of eligible California EV buyers take advantage of the existing rebate program. A point of sale system would likely increase the utilization rate. Few people would bother to get pre-qualified and then not use the funds available when they buy a car. According to a draft of the plan being circulated by CARB, the process would work like this:
- The buyer submits an application with supporting documentation to the Center for Sustainable Energy.
- CSE reviews the application and notifies the buyer via e-mail if it is approved. The approval would come with an expiration date.
- The buyer then visits a local dealer to buy or lease an eligible vehicle. The dealer confirms eligibility online and completes the sale at the net price after the rebate is applied.
- The dealer than submits all required paperwork and is reimbursed by CSE.
Reactionaries like to scream that the federal tax credit is just a taxpayer-supported giveaway to the wealthy. To be fair, it may not be the most efficient way of encouraging more Americans to drive low- and zero-emissions cars. Some suggest putting the money the government spends on the tax credit could be put to better use if it was used to build EV charging infrastructure, especially at apartment buildings and condo developments where access to charging at home is either nonexistent or severely limited.
California consistently leads the rest of the nation in pushing for low emissions transportation. The new point of sale rebate program should begin in San Diego later this year. The data the state collects from that pilot program could lead to changes in the EV rebate program statewide and that would likely have an impact on other states as well.