Recently, Electric Vehicles (EVs) have emerged as a promising advance in technology that could have a substantial impact on various issues currently faced by Michigan and the United States. The most frequently cited public benefit of EVs is the mitigation of greenhouse gas emissions. In the United States, the transportation sector accounts for 28 percent of all greenhouse gas emissions and between 36 and 78 percent of all urban air pollution. Research shows that each EV that displaces a conventional car produces savings of approximately 1.5 tons of CO2 per year and emits almost no harmful pollutants like conventional Internal Combustion Engine (ICE) powered vehicles. Furthermore, 68 percent of all oil consumption in the U.S. comes from the transportation sector. Increased EV adoption could potentially reduce our nation's oil consumption, thus improving energy security. The burgeoning EV industry may also help to reduce the nation's high unemployment rate through the development of industry, business, standards and R&D. Finally, EVs have a lower per-mile cost compared to conventional ICE powered vehicles. For these reasons, states and the federal government have begun providing incentives for the adoption of EV technology by individuals and businesses. At the state level, Michigan currently lags behind other states in available EV incentives. However, at the federal level, one Michigan Senator is at the forefront of proposed EV policy in an effort to keep Michigan competitive in the global EV industry.. Twenty-seven states and D.C. currently provide EV incentives for individuals. Of these 27 states, Michigan provides some of the most marginal incentives. Currently, the only EV incentive in Michigan is the Alternative Fuel Vehicle Emission Inspection Exemption. At the end of 2011, the Vehicle Research and Development Promotion expired. The promotion allowed qualified advanced vehicle research and development projects to be eligible for financing under the Local Development Financing Act. In addition, in an effort to attract businesses engaged in alternative energy projects, including alternative energy vehicles, the Michigan Economic Development Corporation was permitted to designate areas as a "certified alternative energy park". In contrast to Michigan, other states have already begun providing more significant individual EV incentives. For instance, the Illinois Alternative Fuels Rebate Program provides a rebate for up to $4,000 for the purchase of an alternative fuel vehicle. Furthermore, EV registration fees are reduced and EVs may use the HOV lane regardless of the number of occupants. In Indiana, there is a pending incentive that would provide a sales and use tax exemption for the purchase or lease of a new qualified plug-in electric vehicle if the retail transaction occurs before December 31, 2016. Although Michigan lags in EV incentives at the state level, local governments have begun ramping up their financial commitment to this technology. For instance, the Grand Rapids city commission approved the $18,820 acquisition and installation costs for five EV charging stations. To discourage ICE vehicles from using the spots where the charging stations are located, meters were installed and will be charged at a premium fee for those without an EV.
Due to the importance of the auto industry to the Michigan economy, it's not surprising that Michigan Senators and Representatives in Washington would be eager to provide incentives for investment and adoption of EV technology. Senator Debbie Stabenow D-MI is seeking to extend and expand the Charging America Forward Act, which would provide immediate rebates to individuals who purchase an EV. The expansion would also increase the number of EV purchases covered by the $7,500 tax incentive from 200,000 to 500,000 cars. Furthermore, Sen. Stabenow's bill also would designate $2 billion in DOE grants for more investments in the construction of vehicle batteries. Sen. Stabenow's expansion bill is currently in committee review, a place where most bills go to die. However, the Obama administration, General Motors, Johnson Controls, and ten other corporations and associations have voiced their support for Stabenow's bill. President Obama's call for 1 million EVs on the road by 2015 further adds to the likely Executive branch support that is likely for the bill. Sen. Stabenow has stated that Michigan is already a leader in the growing EV industry, and that, to keep the U.S. and Michigan innovators competitive. She also maintains the EV industry's ability to create new jobs. In opposition, the National Automobile Dealers Association claims the bill will put a burden on its members. NADA has stated that it feels it is unreasonable to expect dealers to determine a car buyer's tax status at the time of sale. Furthermore, Republicans in the House will be unlikely to support a bill that includes such an expansion of government spending. Democrats may also feel that the immediate rebate may only amount to tax breaks for wealthy Americans who can afford the $41,000 price tag regardless of the incentives. Therefore, it seems Sen. Stabenow will be forced to rely on support from EV industry giants along with the Executive branch to influence Congress into passing her expansive bill.
EV technology could potentially improve the environment, reduce U.S. oil consumption, and provide jobs for the millions of Americans who are currently unemployed. However, large-scale adoption of EVs is currently barred by their large upfront costs and minimal charging infrastructure. It seems government incentives will no doubt be required to initiate the kind of large-scale adoption of EV technology that would be necessary to achieve the aforementioned public benefits. How and where those incentives will be provided will be interesting to watch as this nascent industry begins to expand into the American marketplace.
"Michigan City OKs Plan to Install Electric Vehicle Charging Stations."Sustainablecitynetwork.com. Sustainable City Network, Inc., 16 July 2011. Web. 19 Apr. 2012. .
Niedermeyer, Edward. "Stabenow Introduces Plug-In Tax Credit Extension."Thetruthaboutcars.com. The Truth About Cars, 7 Feb. 2011. Web. 19 Apr. 2012. .
Thomas, C.E. "Government Incentives Required." Clean Car Options. Web. 19 Apr. 2012. .
Wiederer, Alfred, and Ronald Philip. "Policy Options for Electric Vehicle Charging Infrastructure in C40 Cities." Government Innovators Network: A Portal for Democratic Governance and Innovation. Harvard Kennedy School, 2010. Web. 19 Apr. 2012.
Woodyard, Chris. "Obama's Electric Car Tax Rebate Idea Worries Dealers." USA Today. Gannett, 8 Feb. 2011. Web. 19 Apr. 2012. .