California Cuts Green Car Incentive In Half

Edward Niedermeyer
by Edward Niedermeyer

California has backed up its strict emissions standards for years now with a $5,000 tax credit for electric, hybrid and fuel cell vehicles, which when combined with a $7,000 federal tax credit can often make those vehicles nearly as affordable as “regular” cars. But, reports Automotive News [sub], that state credit has fallen victim to California’s budget woes and oversubscription, and has been cut in half from $5,000 to $2,500. According to the report:

high demand exhausted the program’s funding last month. The Los Angeles Times reported Thursday that about 500 consumers who bought electric cars such as the Nissan Leaf or Tesla Roadster are on a waiting list and will collect the $2,500 rebate.

To deal with growing demand, the pool of money to fund the rebates was increased to between $15 million and $21 million for CARB’s current fiscal year ending June 30, 2012, according to CARB’s announcement. A total of $11.1 million was allocated in the program’s first two years, according to CARB spokeswoman Mary Fricke.

The increased cash pool and lowered rebate amount are aimed at making the incentive available to more consumers, according to CARB’s Web site. The changes are projected to fund about 6,000 rebates for consumers who apply for the program on a first-come basis, Fricke said.

Now California “green car” intenders not only get a reduced tax credit, but they also don’t get free access to the HOV lane anymore. It’s almost as if California wants “green” vehicles to succeed or fail on their own terms…

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4 of 12 comments
  • Rob Rob on Jul 24, 2011

    Build a better mouse trap and the world will beat a path to your door. Failure, on the other hand, requires a government subsidy to survive.

  • MrBostn MrBostn on Jul 24, 2011

    Others may refer to it as running out of other peoples money...

  • BoredOOMM BoredOOMM on Jul 25, 2011

    Edward, California is BANKRUPT and somewhere the bleeding has to STOP. I state if someone has the job to afford the Eco-machine like a $40000 Volt, they can afford the $2500 extra or squeeze the dealer to eat more of the price. I opted to pay $2500 for repairs/upgrades to suspension 3 years ago instead of paying $13000 for a replacement vehicle. Seeing someone whine about a Government rebate is vastly annoying when you don't have enough to buy even a $2500 car. +1 don1967

  • GS650G GS650G on Jul 25, 2011

    I'm glad to hear this. People should buy these cars with their own money. If the economics doesn't add up they can rationalize about how they are saving the world.