Ingredients for Equitable Electrification
Analyzing Equity Among Electric Vehicle Rebate Programs
In the United States, transportation is the leading source of greenhouse gas emissions that cause climate change, and harmful pollutants that cause or exacerbate illness. Low-income areas and communities of color disproportionately bear the burdens of transportation pollution due to decades of racist land use policies and disinvestment. These communities also face high barriers to transitioning to cleaner forms of transportation due to high costs, limited infrastructure and systemic disinvestment.
In order to meet ambitious federal and state goals for reducing harmful emissions, policymakers have established rebate and incentive programs to encourage Americans to transition to zero-emission electric vehicles. To be successful in this transition away from gas-powered vehicles that are responsible for the bulk of harmful emissions, EV rebate programs must enable low-income communities of color to make the switch to EVs. This means designing and implementing EV rebate programs to meet the specific needs of these communities and address the high barriers they face.
With equity at the center of EV rebate programs, states have the potential to accelerate our transition to clean transportation and narrow the racial wealth gap by directing critical funding to the communities that stand to benefit most from EVs.
The Greenlining Institute, in partnership with Towards Equitable Electric Mobility (TEEM), analyzed electric vehicle rebate programs across the country on measures of equity such as income cap, upfront cost, and accessibility in order to offer examples of how rebate programs should prioritize the specific needs of these communities.
Policymakers have established rebate and incentive programs to encourage Americans to transition to zero-emission electric vehicles. Presently, there are approx. 20 states across the U.S. that have some form of EV incentive program.
This white paper focuses on state rebate programs for single occupancy electric vehicles in an attempt to create an apples-to-apples comparison, so administrators and advocates are better positioned to create rebate programs without accessibility and affordability barriers for low and moderate income people. Of the six state rebate programs assessed – California, Michigan, Oregon, Colorado, Illinois, and Virginia; we found that there is significant room for improvement in designing and implementing existing programs in ways that ensure that intended benefits reach communities of color and low-income consumers.
For the purposes of this analysis, equity is defined as increased access to electric vehicles for low-moderate income people and other disadvantaged communities (DACs), who without financial incentives would be less likely to buy or lease an EV.
The analysis revealed that amongst the state electric vehicle rebate programs, there are several key “ingredients” for ensuring programs are equitable. These include:
- High rebate amounts for low-income qualified applicants that can be applied directly to the purchase or lease of a new or used EV.
- Rebates are not treated as taxable income.
- Rebates can be combined with other incentive programs such as charging installation rebates and the Federal EV Tax Credit to further increase cost savings.
- Rebate programs include robust public education and accessibility initiatives that are specifically designed to increase the number of low- and moderate-income applicants. These initiatives may include public workshops, webinars, vehicle test drives and dedicated coaches and case managers to equip consumers with the knowledge of how to to take advantage of these resources.
- Rebate programs provide online and printed information, application materials and customer support services in multiple languages.
- The primary objective of the rebate program is to increase access to low and moderate income families, rather than to accelerate market transformation.
The report recommends that policymakers prioritize accessibility and affordability for low-income consumers, rather than focusing on market transformation and the acceleration of EV adoption, which do a poor job of delivering equity outcomes. We found that rebate programs that apply these equity ingredients throughout their design, implementation, and vision have the greatest potential to accelerate EV adoption in a way that benefits all people, regardless of where they live, their background, or income.