The Biden Administration and fellow Democrats in Congress continue to lead the green energy charge, which is creating resounding benefits for the EV industry as a whole. The latest is the aptly named Growing Renewable Energy and Efficiency Now, or GREEN, Act (you gotta love those clever acronyms!) sponsored by Representative Mike Thompson (D-CA-5). Earlier this month, the House Ways and Means Committee introduced the bill as a way to advance an agenda centered on achieving greater levels of sustainability, and we were pleased to see several provisions included that would further encourage EV adoption.
In particular, EV buyers would be able to tap a $7,500 federal tax credit, while the credit cap for EV manufacturers would be increased to 600,000 vehicles. The credit, however, would subsequently be reduced to $7,000 after the first 200,000 vehicles are sold. Many analysts have noted that American automakers like Tesla, Ford and GM stand to profit in a big way thanks to the fact that each can sell 400,000 more EVs precisely at a time when all three are making expansive moves in the marketplace. But as favorable conditions for EV manufacturing improves, it is likely more cautious players will begin to wade into the arena as well.
The value to drivers is equally prolific, reducing the overall purchase price of a new clean energy vehicle while also saving them thousands of dollars a year in fueling costs. This is especially prescient now when the pandemic has left many with reduced incomes. According to a recent study by The Ascent (https://www.fool.com/the-ascent/research/average-monthly-expenses/), “the average American spends close to 20% of their income just on getting around.” And many are now seeking ways to cut back on that. In essence, federal subsidization combined with economic belt-tightening across households will continue to make EV ownership more attractive to motorists around the country.
According to Congressman Thompson, the bill “expands the use of renewable energy through federal tax incentives that will promote clean energy technologies and faster deploy zero-emissions vehicles.” How much faster? An analysis by Rhodium Group (https://rhg.com/research/an-assessment-of-the-green-act/) finds anywhere from 3.4 to 5.7 million more EVs being sold between now and 2030 if these new tax credits take effect than if current policies remain.
We see all this as a strong tailwind for the burgeoning EV marketplace and an opportunity for EVCS to expand its brand, not just across the West Coast, but throughout the country. Our turnkey solution has already allowed countless commercial, industrial, municipal and multi-family property owners in California alone to attract residents, customers and employees who embrace responsible mobility while also generating new sources of revenue and encouraging greater EV participation through increased accessibility. As such, we fully support this measure and the anticipated impact it will have on millions of Americans who have yet to experience the same benefits as the Golden State.
With Democratic majorities in both houses of Congress, the bill is likely to get approved along party lines and sent to the President’s desk for signature. However, Democratic senators in fossil fuel-friendly states have been known to occasionally side with Republicans in thwarting such measures, so the bill’s passage is not a foregone conclusion. At this point, we just have to wait with our fingers tightly crossed, although it is important to note that senators who appear indecisive might be moved through calls and emails from passionate constituents.
Details about the actual bill can be found on the official Congressional website here: https://www.congress.gov/bill/117th-congress/house-bill/848/textTags: EV adoption, EV infrastructure, EV tax credits, GREEN Act, Joe Biden, Mike Thompson, renewable energy, Tesla