California is making changes to its electric car rebate program in an effort to prioritize subsidies for low-income residents. The state’s popular Clean Vehicle Rebate Project, which has been in place since 2010, will end this year as its funding runs out. Instead, California will expand its “Clean Cars 4 All” program by 2024, which will provide grants for scrapping and replacing cars with old gasoline engines with cleaner alternatives or for the purchase of new electric cars.
Income eligibility limits will be more stringent, meaning those earning more than 300% of the federal poverty level will no longer qualify. Previously, individuals earning up to $135,000 and joint filers earning up to $200,000 qualified for the discounts. Experts believe that this change reflects the transition of electric cars from being considered luxury items to becoming more common vehicles.
The Clean Vehicle Rebate Project has been instrumental in helping Californians transition to electric vehicles and has issued half a million rebates worth $1.2 billion since its inception. However, the program often faces issues of insufficient funding, leading to long waiting lists. By redirecting resources to low- to middle-income buyers, the state hopes to make electric cars more affordable for a wider segment of the population.
While some car dealers have expressed concern that ending the discount for middle- and high-income buyers could dampen sales, others understand the need for a change in approach. California aims to make 100% of its vehicle sales zero-emission by 2035 and believes that providing subsidies to those who do not reach electric vehicles will help accelerate the adoption of clean transportation.