Electric Vehicle Benefits

Vehicles powered by internal combustion engines are a major source of emissions in Texas, significantly contributing to smog (ozone) and other greenhouse gases. The TCEQ estimates that roughly 46 percent of all NOx emissions in Texas can be attributed to mobile sources.

A 2015 study conducted by Electric Power Research Institute and the Natural Resources Defense Council found that widespread use of plug-in hybrid electric vehicles could dramatically reduce greenhouse gas emissions and improve ambient air quality. The study simulates emissions and air quality impacts of a significant shift from internal combustion engines to electric vehicles and equipment.

The report also found that by using electricity produced from diverse domestic resources, plug-in cars can reduce U.S. dependence on imported oil. The study also measured the impact of increasing numbers of plug-in hybrid vehicles over the next 40 years, including the environmental benefits of using large vehicle fleets powered by electricity from the grid as their primary fuel source.

The study found that with the widespread adoption of plug-in electric vehicles, greenhouse gas (GHG) emissions would be reduced, even when compared with more efficient conventional vehicles. Electrifying vehicles and non-road equipment will lead to better air quality.

The report analyzes two potential scenarios of the future electric sector, the “Base GHG” and “Lower GHG.” Both show grid emissions decreasing over time, in part because of existing and potential regulations and plausible economic conditions.

Specific findings from the EPRI / NRDC study include:

• In the Lower GHG scenario, further reductions in carbon emissions result from an increasing price on carbon, resulting in faster deployment of low emission generation technologies.
• In the Base GHG scenario, the study estimates that, by 2050, the electricity sector could reduce annual greenhouse gas emissions by 1030 million metric tons relative to 2015 levels, a 45% reduction.
• In the Lower GHG scenario, the study estimates that, by 2050, the electricity sector could reduce annual greenhouse gas emissions by 1700 million metric tons relative to 2015 levels, a 77% reduction.

While it is difficult to predict how many jobs will be created from the widespread adoption of EVs and related components and equipment powered by electricity, there is enormous potential for economic development in this emerging industry. A 2009 study released by the Center for Entrepreneurship & Technology at the University of California, Berkeley, estimates up to 350,000 new jobs may be created from the mass-market adoption of electric vehicles by 2030.

In addition, a consortium of U.S. battery companies banded together to spur innovation of the next generation of domestic plug-in vehicles batteries. Growth in this industry is expected to drive down the cost of the batteries, and also create new jobs for scientists, engineers, designers and others.

In Texas, several technology companies and investors have expressed interest in building manufacturing facilities that could create thousands of new jobs. The construction of an infrastructure needed to support plug-in vehicles, including public and private recharging stations, also is expected to stimulate economic activity and add new jobs.

• The federal Internal Revenue Service (IRS) tax credit is for $2,500 to $7,500 per new EV purchased for use in the U.S. The size of the tax credit depends on the size of the vehicle and its battery capacity. To find out specific tax credit amounts for individual vehicles, visit FuelEconomy.gov’s Tax Credits for Electric Vehicles and Tax Credits for Plug-in Hybrids pages.
• This tax credit will be available until 200,000 qualified EVs have been sold in the United States by each manufacturer, at which point the credit begins to phase out for that manufacturer. Currently, no manufacturers have been phased out yet.
• To claim the credit, fill out IRS Form 8936, Qualified Plug-in Electric Drive Motor Vehicle Credit. For vehicles acquired for personal use, report the credit from Form 8936 on the appropriate line of your Form 1040, U.S. Individual Income Tax Return. For vehicles purchased in 2010 or later, this credit can be used toward the alternative minimum tax (AMT).  To learn more about the law, visit the IRS’s Plug-in Electric Drive Vehicle Credit webpage.

In 2014, Texas lawmakers enacted a program to help promote the sale of EVs in Texas, authorizing a $2,500 incentive on the purchase of new EVs in the TCEQ’s Texas Emissions Reduction Plan.

From May 2014 through June 8 2015, the state granted rebates totaling $3.4 million for just over 1,700 clean-energy vehicles. Combined with $7,500 in federal tax credits, the incentives together lowered the net price a Chevy Volt, amongst the most popular cars in the state program, by nearly one-third. Ford bi-fuel natural gas trucks were also a popular purchase by Texans.

The TERP chapter extending Texas’ program to boost sales of green vehicles ended just over a year after it launched.

Lawmakers likely will debate legislation to reinstate the EV CNG, LNG and hydrogen rebate program when Texas lawmakers meet again in 2017, in part because the state may have to find ways to further reduce emissions under new federal air standards.

Plug-In Texas will support the incentives’ extension.

In addition, the Texas Commission on Environmental Quality administers the AirCheckTexas Drive a Clean Machine, which provides a vehicle replacement assistance for qualified individuals owning vehicles registered in participating counties. Vouchers totaling $3,500 are available for the purchase of a hybrid electric, battery electric, or natural gas vehicle that is up to three years old.