California Imposes Income-Based Caps On Electric Vehicle Rebates

California Imposes Income-Based Caps On Electric Vehicle Rebates
Tesla Model S Maurizio Pesce / Flickr CC BY 2.0
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As far as the California Clean Vehicle Rebate program is concerned, high-income earners will no longer be eligible for a rebate starting this month, Cars Direct has learned. The Clean Vehicle Rebate Project (CVRP) is actually being managed by the Center for Sustainable Energy for the California Air Resources Board.


The idea behind the CVRP program is to encourage the overall reduction of cars’ environmental cost by encouraging people to opt for cleaner, emission-free vehicles.

As a result, people who have purchased or leased new, eligible zero-emission and plug-in hybrid light-duty vehicles can receive anywhere between $1,500 and $5,000 worth of electric vehicle rebates. This depends largely on the kind of electric car, plug-in vehicle or hydrogen fuel-cell car the vehicle owner has. Moreover, one is entitled to a rebate within 18 months from the purchase or lease of the vehicle.

Since the inception of CVRP, the Center for Sustainable Energy has already issued a little over $223 million in rebates. Moreover, rebates issued and reserved for the fiscal year of 2014 to 2015 amounted to a little over $89 million.

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In a recent press statement, the California Air Resources Board has revealed that it just approved a $373 million funding plan that would cover “all investments in advanced technologies” for the fiscal year 2015-2016. Moreover, such investments will include anything “from zero-emission heavy-duty trucks and buses to rebates for low- and zero-emission passenger vehicles.”

There is a clear priority to reduce emission produced by vehicles throughout California. As California Air Resources Board Chairman May D. Nichols had explained, “Action taken by the Board today to boost funding for clean vehicle programs is in direct response to growing demand, and the need to put more zero-emission vehicles on California’s roads and highways.”

Moreover, she added,”This funding plan delivers clean air, less carbon pollution and provides financial incentives to allow all Californians to benefit from driving and owning the cleanest vehicles.”

To have more of the cleanest vehicles take to California streets, part of the funding plan includes the allotment of $163 million for the CVRP. The said amount has been set aside in response to its projected demand for the coming year.

They have also said that it “includes an income eligibility cap to exclude high-income consumers and higher rebate levels for lower income consumers.” The California Air Resources Board has told Cars Direct that such a move changes the program’s dynamics “in a way that targets incentives towards those likely to value the rebate most.”

In order to be able to provide higher rebates to those with lower income, those earning incomes that are 300% less than the Poverty Limit will now be entitled to $4,000 worth of rebate for an electric vehicle, $3,000 for plug-in hybrid vehicles and $6,500 for fuel cell vehicles.

Meanwhile, those with incomes of over $250,000 will no longer be entitled to a rebate for electric vehicles and plug-in hybrid vehicles. However, Green Car Reports has also learned that high-income earners will still qualify for rebates when it comes to hydrogen fuel-cell cars.

As far as funds for the CVRP goes, the Center for Sustainable Energy reports that they still have around $20.5 million in remaining funds for the fiscal year of 2014 to 2015.


Morning News USA has recently received some information updates with regard to this story:

– The income cap for rebates will be as follows: $250,000 for individual filers, $340,000 for head-of-household filers, and $500,000 for joint filers.

– The $163 million budget plan is still subject to approval by the Legislature.

– Contrary to some reports, California Air Resources Board Public Information Officer Melanie Turner has told Morning News USA, “These changes were NOT effective July 1. The Board adopted the funding levels on June 30; however, ARB is not going to implement these changes for four to six months. In the meantime, CVRP will operate as business as usual. In addition, these changes are not retroactive.”