One of the many perks of getting an electric car is the cost savings. Although many of these savings, such as lower fuel and maintenance costs, pencil out over the life of the car, there are also many purchase incentives to offset the price of the car and accessories, such as a home charger. Local and national governments alike are providing incentives to EV drivers, with the hopes that these investments will create jobs, reduce household transportation costs, improve air quality, and significantly reduce carbon emissions. Transitioning our transportation system to electric has been cited as a major factor in mitigating climate change, and protecting public health. Experts expect that EV investment will also lead to economic benefits and job creation, which is the heart of automotive manufacturing in the US.
In 2022, the Biden administration signed the Inflation Reduction Act (IRA) into law, which provides almost $370 billion in federal funding for climate and energy investments (including EVs). Experts suggest the IRA could reduce carbon emissions by 40 percent by 2030.
With an increasing landscape for incentive programs, it can be confusing to figure out what is available in your local area. We’ve put together a list of some of the best places to look for EV incentives in any local region.
Alternative Fuels Data Center (AFDC)
The US Department of Energy’s AFDC is a great place to start when looking for incentives at any level. AFDC has a vast database that enables you to search incentives and laws by jurisdiction, technology/fuel, incentive/regulation, and user type (e.g., commercial, personal, etc.). The only downside can be that the language is often pulled directly from the legislation so it might be full of jargon and legalese. However, it’s a great jumping off point and very well maintained.
We recommend looking at your utility companies to see if they have any incentive programs for EVs. You can search on your utility's website or call/email customer service to gain information about any incentives offered by the company.
- PSE&G offers residential EV drivers a tax rebate of $1,500 for installing a Level 2 fast charging station.
- In Vermont, Stowe Electric offers customers rebates for the purchase or lease of EVs. New plug-in hybrid electric vehicles (PHEVs) are eligible for a $750 rebate, new all-electric vehicles are eligible for up to $1,000, and income-qualifying customers are eligible for an additional $250 rebate for either vehicle. Stowe Electric also offers a $300 rebate for the purchase of pre-owned EVs and PHEVs.
- Many utility companies also offer special rates for EV owners who charge at home, dedicated EV time-of-use plans, or demand response programs where ratepayers get credits if they change their charging habits when demand is very high. We have an entire guide on this!
The incentive that has made the most headlines is, of course, the federal tax credit for new EVs. Depending on your purchase, you may be eligible for up to a $7,500 tax credit for a new EV. It’s not a flat rate, and is proportionate to how much you owe in federal income tax. For example, if you only owed $3,500 in income tax, then that is the federal tax credit you would receive. If you owed $10,000 in federal income tax, then you would qualify for the full $7,500 credit. Of note, any unused portion of the $7,500 is not available as a refund, nor as a credit for next year’s taxes.
The Biden administration is also expanding access through a first-ever program offering federal tax credits for used EVs, in addition to new ones. Thanks to the Inflation Reduction Act of 2022, there’s a new federal tax credit of $4,000 for used EVs priced below $25,000. If you want to go even further with your decarbonization efforts, this same legislation also expands tax credits for solar installations, community renewable energy, and home battery storage.
It’s important to also look into opportunities via your city and state governments. The AFDC provides overviews at the state and local level, but you can also google your town or county name + “EV incentives” for more information.
- In New York, thanks to the Drive Clean Rebate, New York State Energy Research and Development Authority (NYSERDA) provides rebates of up to $2,000 for the purchase or lease of a new eligible plug-in electric vehicle. NY also offers an income tax credit for 50 percent of the cost of alternative fueling infrastructure, up to $5,000.
- California’s Clean Vehicle Rebate Project offers rebates between $1,000-$7,000 for the purchase or lease of qualified vehicles. Low income applicants are eligible for higher incentives, and there is an income requirement to this credit.
- Cincinnati allows EV drivers to park for free at any street or metered parking space in the city on a first-come, first-served basis.
Finally, many car companies offer various incentives for their products. These incentives apply mostly to new cars, but many companies offer perks that help you get set up with your new EV, or to charge for free on the road. For instance:
- Chevrolet offers home charging installation for a level 2 with the purchase or lease of a 2023 Bolt EV or EUV, or credits to charge for free at EVgo public charging stations
- Volkswagen’s 2023 ID.4 comes with three years of 30-minute charging sessions at Electrify America’s nationwide network of DC fast-charging stations
Chargepoint has a user-friendly site that allows you to search incentives easily.
Electric for All has a simple site to search for local EV incentives, including utility incentives in your area.
Electrek has a comprehensive list of federal tax credits for EVs as of 2022.
Written by Carolyn Kossow (she/her), a gender, queer, and racial justice activist who is dedicated to a life and career advocating for social justice. Carolyn has enjoys being able to support the work of several mission-driven organizations: nonprofits, start-ups, small business, and global companies alike.