In an opinion piece published in the New York Times on October 24, 2019, Senate Minority Leader Chuck Schumer (D-NY) proposed a plan to boost the US electric vehicle industry and reduce carbon dioxide (CO2) emissions from the transportation sector. Schumer says he will include this plan in comprehensive climate legislation next year if Democrats gain a majority in the Senate in the November 2020 elections.
Supporters of Schumer’s plan include environmental advocacy groups, labor unions, and automakers. For every gallon of gas that internal combustion engine vehicles use, they emit about 20 pounds of carbon dioxide through the tailpipe. Electric vehicles, which produce no tailpipe emissions, are a solution to reduce carbon dioxide in the air, even in regions that still rely on coal power. As more of the electricity that they draw from the grid is produced from carbon-free sources such as wind and solar, their climate benefits will only increase.
According to the Clean Cars for America plan details on the Senate Democrats’ website, the plan would cost $454 billion over 10 years and would include three components:
- Vouchers for electric, hybrid-electric or hydrogen fuel cell vehicles when drivers trade in their internal combustion engine cars;
- Grants to state and local governments to install electric vehicle charging stations; and
- Grants to factories that will produce electric vehicles in the US.
The plan sets an ambitious target for all vehicles on the road in the US to have zero tailpipe emissions by 2040. Schumer says the vouchers, grants and other provisions of his plan would get the US 25% of the way toward that goal. However, the plan addresses only light-duty passenger vehicles, not larger heavy-duty vehicles.
Federal financial incentives for the purchase of electric vehicles do already exist in the form of a $7,500 tax credit. However, the number of tax credits per vehicle model is limited, and current programs are phasing out as vehicle models reach their limits. Schumer’s plan would offer cash vouchers ranging from $3,000 to $7,000 for about 63 million clean vehicles. The amount would depend on the income level of the customer and the characteristics of the vehicle.
In August 2018, the Trump Administration proposed a rollback of existing federal corporate annual fuel efficiency (CAFE) standards, which had been designed to push the market toward adoption of electric and hybrid-electric vehicles. The proposed rollback has yet to be finalized, let alone survive what is likely to be a lengthy court challenge. Senator Schumer’s plan sidesteps the uncertainty created by this conflict, and instead offers an alternative mechanism using market incentives to prod automakers and drivers to go a cleaner route.