Biz & Tech
August 7, two thousand seventeen Updated: August 7, two thousand seventeen 6:00am
California has far more electrical cars and plug-in hybrids plying its roads than any other state – about 300,000 so far. But they`re still just a lil’ fraction of auto sales.
Now, legislation in Sacramento is designed to juice the market, just as a fresh generation of long-range electrical cars hits showroom floors.
A bill from Assemblyman Phil Ting, D-San Francisco, would revamp and expand California`s existing rebate program for people who buy electrics or plug-in hybrids. The bill, a version of which has already passed the Assembly, would devote $Trio billion to clean car incentives. The money would come from the state`s cap-and-trade system for controlling greenhouse gas emissions.
The fresh rebates would begin big – how big has yet to be determined – and then shrink over time, as plug-in cars become more common and affordable. Eventually, the rebates would vanish altogether.
It`s the same treatment California used ten years ago to kick-start sales of rooftop solar arrays. That rebate program helped create the state`s solar industry.
Even in eco-conscious California, sales of battery-powered cars have not accelerated as quickly as state officials wished, due to relatively low gasoline prices and the limited range of most electrified vehicles.
More by David R. Baker
But late last year, General Motors commenced selling a $37,500 car – the Chevy Bolt – that can go two hundred thirty eight miles on a charge, long enough to treat even brutal Bay Area commutes. Tesla just debuted its $35,000 Model Three, whose base model gets two hundred twenty miles per charge. And Nissan is expected next month to introduce the long-awaited redesign of its electrified Leaf, suggesting similar range.
«It`s time to be even more aggressive,» Ting said. «The reason we`re doing this now is there truly hasn`t been electrical vehicles for the mass market before. Most (electrified vehicles) get eighty miles, and even if you live in San Francisco and you`ve got a 30-mile commute, you can get range anxiety pretty quickly.»
California has set ambitious goals for slashing its greenhouse gas emissions and has stuck to those goals even as the federal government under President Trump moves to gut federal climate-change efforts.
State law calls for cutting greenhouse gas emissions forty percent below one thousand nine hundred ninety levels by 2030. That can`t happen, however, unless drivers switch to cleaner cars.
Transportation accounts for thirty seven percent of all the state`s greenhouse gas emissions, more than any other sector of the economy.
«There`s no way to meet our climate goals without dramatically reducing emissions from transportation,» said Don Anair, deputy director of the clean vehicles program at the Union of Worried Scientists public policy group. «We`re not going to get there by continuing to burn oil in our cars.»
Gov. Jerry Brown wants 1.Five million electrified cars on the state`s roads by 2025.
Ting just bought a Bolt, which he can drive from San Francisco to Sacramento and back on a single charge (albeit he usually tops off the battery at work). «This is a major shift,» he said. «Now you have cars that fit most consumers` needs.»
The current state rebate system offers $Five,000 for hydrogen fuel-cell vehicles, $Two,500 for electrics and $1,500 for plug-in hybrids. More than $439 million in rebates have been passed out so far, with about thirty eight percent of the money going to Bay Area drivers. The popular program often runs out of money during the year, forcing rebate applicants to sit on a waiting list until the Legislature appropriates more cash.
Ting`s bill, AB 1184, would make several significant switches. Rebates would be passed out at the point of sale and would be tied to a dedicated, ongoing funding stream. Dealers would be able to factor the rebates into their advertised prices for cars, something they can`t do now without potentially misleading buyers.
The bill also calls for pegging the size of the rebate to the price difference inbetween an electrified car and «the cost of the most frequently sold compact car in the state.» The aim is to eliminate the higher up-front cost of electrified cars as a reason for people not to attempt them, but the idea is only vaguely sketched out in the bill draft available online.
«I have no idea what that language means,» said Gene Erbin, a lobbyist indicating the Alliance of Automobile Manufacturers, at a July meeting of the Senate`s Committee on Energy, Utilities and Communications.
The bill`s fate is far from certain, and elements of it remain subject to switch.
Many of the key details – such as the size of the rebates and the exact method of calculating them – would need to be hashed out by state regulators, should the legislation pass. Some critics say it favors electrical cars over plug-in hybrids and fuel-cell vehicles, issues Ting says he wants to address.
An analysis ready in June for a Senate committee questioned many of the bill`s details, including its recommendation that the program receive $500 million each year from the proceeds of the cap-and-trade program until the $Three billion total is reached. Cap and trade, the analysis noted, generated $850 million in revenue last year, of which $510 million was already appropriated to other programs.
In addition, the bill faces criticism that it is meant to help Palo Alto`s Tesla, whose very first three models – before the Model three – generally cost more than $100,000. Tesla buyers presently can take advantage of both the state rebate and a $7,500 federal tax credit. But the federal credit for any automaker`s customers phases out when the number of electrified cars sold by that automaker in the U.S. reaches 200,000. Tesla is expected to hit that number within the next year.
Steve Chadima, senior vice president of Advanced Energy Economy, which represents businesses pushing for a low-carbon economy, said the bill had «nothing to do with Tesla.»
«The word ‘Tesla` never passed anybody`s lips the entire time we were talking about how to construct this bill,» he said.
Even if Ting`s bill passes, electrical vehicles still have a long road ahead, including in California.
As of May, California drivers had registered 153,737 unspoiled electrical cars – just over half of all electrics nationwide – as well as 143,473 plug-in hybrids, according to the Auto Alliance, an industry group. While the numbers are growing, those cars together represent just over three percent of California`s fresh car market. Many consumers don`t want to deal with a fresh technology and the routine of figuring out when and where to charge up their cars, particularly when gasoline prices are relatively low.
«You`re asking people to adopt different behavior – it`s not exactly seamless with the way they behaved before,» said Jessica Caldwell, executive director of industry analysis at the Edmunds auto information service. «I used to live in a condo, and I can`t imagine asking the HOA to install a home charging system.»
David R. Baker is a San Francisco Chronicle staff writer. Email: [email protected] Twitter: @DavidBakerSF
California clean-car rebates
California already offers rebates to drivers who buy electrical cars, plug-in hybrids and fuel-cell vehicles. Much of that money has gone to the Bay Area.