Addressing an Equitable Transition to Electric Vehicles: Current Policies and Recommendations

Addressing an Equitable Transition to Electric Vehicles: Current Policies and Recommendations

As electric vehicles (EVs) become more popular and the US transitions away from fossil fueled transportation, bridging the income gap in EV ownership remains an important challenge. According to the City of Boston, only 8% of Boston EV owners have an annual income of less than $50,000 dollars. Given that EV’s are much cleaner and less expensive to drive, and given that air pollution disproportionally burdens low income communities in the U.S., it is important that these communities have access to the technology that is both cheaper to own and can provide them with cleaner air. 

(Image Credit: NYC Department of Transportation)

Finding ways for people of all incomes to have access to EVs will rely on several variables. For example, the higher upfront cost of EVs and limitations on EV charging availability are some of the barriers for low income individuals.  Regarding cost barriers, both state and federal incentives have attempted to alleviate the higher upfront cost of the vehicle by providing rebates and tax incentives. 

Federal Incentives

Currently, individuals purchasing new EVs are eligible for a $7,500 tax credit from the federal government. Recently, the Department of Treasury proposed a rule that by next year individuals can receive $7,500 off of their purchase immediately (rather than deferred to their tax filing). This could help lower the upfront cost – one that is daunting to a low or moderate income earning individual. Additionally, under this proposed rule, a $4,000 rebate would be given to those purchasing used or second-hand EVs. 

Massachusetts Incentives 

The ‘Massachusetts Offers Rebates for Electric Vehicles’ (MOR-EV) program gives rebates of $3,500 for both new and used EVs. For those of mid to low income, they can receive an additional $1,500 off the purchase price of their vehicle. To get the additional rebate, one must prove enrollment in a state assistant program. By combining state and federal incentives, the cost of an EV in Massachusetts becomes much lower than its point of sale price. 

Charging Access

Additionally, access to charging  needs to be more widely available in low income communities as EVs become more accessible over time. The World Resource Institute lays out a few recommended strategies to implement EV charging in low income communities. 

  1. Community members should be involved in choosing charging locations, as they know their neighborhoods best. Places like Seattle and San Antonio have issued surveys and received feedback on charging location sites from community members. Additionally, these charging locations should be near renters and multi-family housing.
  2. Chargers should be adaptable to their landscape— such as curbside (rather than personal garage) charging for urban areas. 
  3. Chargers should be transparent about cost per kilowatt and set reasonable prices, especially since low income individuals experience a disproportionate energy burden. 

According to the National Renewable Energy Lab, by 2030, EVs are projected to represent 48% to 61% of private cars on U.S. roads. To ensure an equitable transition to electric vehicles, this percentage of EV owners must represent a more diverse income pool. Current policies exist to achieve this goal, although it will take more widespread adoption to reach accessible EV adoption. These steps are vital to ensure that EV ownership expands beyond economically privileged individuals. 

References: 

https://www.boston.gov/sites/default/files/file/2020/10/Boston%20ZEV%20Roadmap_1.pdf

https://agupubs.onlinelibrary.wiley.com/doi/10.1029/2021GL094333

https://www.cnbc.com/2023/10/10/7500-ev-tax-credit-may-be-easier-to-get-in-2024-per-treasury-rule.html

https://www.wri.org/insights/electric-vehicle-charging-station-access

https://www.nrel.gov/docs/fy23osti/85654.pdf

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