Washington state will launch an electric vehicle rebate program this summer in an effort to make EVs affordable for between 6,500 and 8,000 low-income residents, state officials announced Tuesday.
The program will launch in August and will offer to eligible residents $5,000 off a new EV or $2,500 off a used EV at the time of purchase from a dealer.
The program also includes an incentive of up to $9,000 for a new EV lease, or up to $2,500 off a used EV lease. The maximum incentive is available for leases on a three-year term, or longer.
People earning 300% or below of the federal poverty level are eligible for the program’s incentives. That works out to earnings of less than $45,180 annually for a single person or less than $93,600 for a family of four. The program will run through June 2025 or until funds run out.
“Washington state is already a leader in EV adoption, but many more people interested in ditching the gas pump may think they can’t afford to do it,” Gov. Jay Inslee said in a news release.
Vehicles must be fully battery electric and must have a manufacturer’s suggested listed price of below $90,000 to be eligible.
This new state incentive can be layered with the $7,500 federal EV tax credit, potentially significantly lowering the cost of a car. EVs purchased in Washington also are exempt from sales tax with a waiver worth up to $15,000 depending on the price of the car.
The $7,500 federal tax credit only applies to 10 of the 49 EVs on the market, under Biden Administration rules that dictate manufacturing requirements for battery parts.
The biggest savings could be found in EV leases. According to the state Department of Commerce’s estimates, the payments for a Nissan Leaf, for example, could be as low as $86 a month with the $9,000 rebate.
Department of Commerce director Mike Fong said during a news conference that most federal rebates and incentives “lean toward supporting more affluent, more wealthy communities and individuals.”
“Where we see that there is still some challenges in adoption … [is] from communities of color, from low-income communities about whether or not this product is available for them. We’re here to say … it absolutely is,” he said.
The program is funded through $50 million set aside from the Legislature’s general fund.
According to the Department of Commerce, the program is estimated to reduce up to 24,000 metric tons of carbon emissions in the transportation sector, which is the greatest contributor to the state’s greenhouse gas emissions. According to the state’s 2019 emissions inventory, gasoline contributed toward 16.9 million metric tons of carbon dioxide emissions.
Matthew Metz, the co-executive director of Coltura, a Seattle-based non-profit that advocates reducing gasoline use, said the state’s program is a “good start” and the maximum rebate of $9,000 is “one of the most generous programs in the country.”
A standard lease payment on gas-powered cars usually runs between $400 and $500 a month, he said.
Metz cautioned against the emphasis on subsidizing leasing over purchasing, especially since the $50 million is likely to eventually run out.
The program could end up affecting a small portion of the 6 million cars in the state.
Standard lease contracts usually stipulate that the driver can only drive between 10,000 and 12,000 miles a year before incurring a $0.25 per mile charge, he said, which could complicate some drivers’ choices.
The Department of Commerce said it intends to reach out to residents living in communities most affected by automobile pollution and who drive more than 19,000 miles a year for work.
In 2022, Coltura published a nationwide study analyzing gasoline “superusers” and pointed out that about 7% of Washington drivers account for about 1/4 of the state’s gas consumption, each driving around 30,000 miles a year. These drivers tend to live in rural areas where people drive longer distances, often with larger vehicles, according to the study.
Metz also said it is notable the program includes EVs with a listing price of up to $90,000, which is relatively high compared to rebate programs in other states. That price limit will mean vehicles like a Ford F-150 Lightning and Tesla Model S would be eligible.
The program also states that car dealerships who want to participate in the program must either only sell EVs or have two more locations in the state. That would likely cut out smaller dealers in some neighborhoods, Metz said.
On Monday, state officials announced more than $156 million in funding to launch rooftop solar and solar energy programs to people with lower incomes. In February, the state also announced $85 million in grants to help nonprofits, electric utilities, tribal nations and public agencies install thousands of electric vehicle chargers.
The announcements come as lawmakers are staring down the November election, when voters will decide the fate of the state’s landmark carbon pricing program through a ballot initiative. Signed into law in 2021, the Climate Commitment Act requires the state’s biggest polluters to reduce their emissions or purchase allowances to cover them. The program will gradually reduce the number of allowances sold, ramping up pressure on industries to decarbonize.
The carbon market raised an estimated $1.8 billion in 2023 to be spent on efforts to adapt to and combat climate change.
Material from Seattle Times archives was used in this report. Staff reporter Isabella Breda contributed reporting.
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