States Offer Incentives To Charge Up EV Market

Pixabay / Gerd Altmann
Published On
Jul 23, 2021

Electric vehicle (EV) sales are growing nationally, and the industry is getting plenty of help from government incentives to support this rapid acceleration.

Nearly every state in the country has adopted some sort of incentive program. According to the National Conference of State Legislatures (NCSL), Washington, D.C., as of November 2020, 45 states and the District of Columbia provide an incentive for certain EVs or plug-in hybrid electric vehicles (PHEVs). These incentives are offered either through state legislation or through a specific utility operating within the state. The incentives range from tax credits or rebates to fleet acquisition goals, exemptions from emissions testing or utility time-of-use rate reductions.

The NCSL cites as examples financial incentives, including tax credits, rebates and registration fee reductions adopted by several states. It highlights Colorado, which offers a $4,000 tax credit through 2021 on the purchase of light-duty EVs, and Connecticut’s Hydrogen and Electric Automobile Purchase Rebate that offers incentives of up to $9,500 for state residents who purchase or lease an eligible battery electric, PHEV or fuel cell EV.

In July, the New Jersey Board of Public Utilities (NJBPU) opened its second year of the Charge Up New Jersey EV incentive program. It provides a rebate of up to $5,000 toward a new EV purchased or leased in the state. The incentive is available exclusively as a “point-of-sale” rebate applied during the purchase or leasing process at dealerships. The program will help the state reach Governor Phil Murphy's goal of having 330,000 EVs on New Jersey roads by 2025.

The second year of the Charge Up program builds upon the success of the first year, which saw more than 7,000 drivers take advantage of the incentives. It is comprised of a two-tier incentive based on the final manufacturer’s suggested retail price (MSRP). EVs with an MSRP up to $45,000 are eligible for $25 for each mile of all-electric driving range as determined by the U.S. Environmental Protection Agency (EPA) ratings, up to $5,000. Eligible EV models with 200 miles or more of EPA-rated all-electric range receive the maximum amount. EVs with an MSRP between $45,000 and $55,000 receive $25 for each mile of all-electric EPA driving range, up to $2,000. The incentive program is limited to vehicles with a final MSRP of less than $55,000.

States aren't the only government agencies offering an incentive for EVs. All-electric and PHEVs purchased new in 2010 or later may be eligible for a federal income tax credit of up to $7,500. The credit amount will vary based on the capacity of the battery used to power the vehicle.

According to the EV industry blog, EVadoption, EV sales could reach approximately 29.5% of all new car sales in 2030, up from roughly 3.4% in 2021. Sales could increase to 4.7 million from a little more than 500,000 in 2021.

About the Author

Rick Laezman

Freelance Writer

Rick Laezman is a Los Angeles-based freelance writer who has been covering renewable power for more than 10 years. He may be reached at

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