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Democrats Vote to Increase Electric Costs
Will disproportionately affect low income households

Governor Kate Brown’s bill, HB 2165, carried by Representative Karin Power (D-Milwaukie) passed the House along party lines. Democrats are claiming the bill will increase the affordability of electric vehicles (EVs) by removing the sunset on the Oregon Clean Vehicle Rebate Program, and doubling the Charge Ahead rebate offered by the program up to $5000, but not less than $2500. It also makes eligible vehicles up to $60,000 retail price.

“Increasing the value of the Charge Ahead rebate will better meet the needs of low- and moderate- income families, helping address the upfront costs of purchasing an EV, and will help household budgets by saving folks money on fuel and car maintenance,” said Rep. Karin Power. “This work is especially important for the health of communities that live near transportation corridors, and for our youngest Oregonians whose lungs are still developing. This bill is a next step in supporting cleaner air, electrification, and grid resilience across our state.”

What the House Democrat announcement fails to point out is the bill is divided between two main activities: Transportation Electrification & Infrastructure, and Zero Emission & Electric Vehicle (ZEEV) Rebates.

The ZEEV portion has to do with increasing the Charge Ahead Rebate program (zero-emission vehicle rebates). The rebates are funded through a tax of 0.5% on new vehicle value imposed on dealers for the privilege of selling in Oregon that increases the cost of a $50,000 vehicle by $250. So, in reality it doesn’t make an electric vehicle any more affordable, it simply makes up for this added tax. That tax revenue is expected to average $31 million a year, and will annually transfer $12 million to the Charge Ahead Rebate program.

In 2019, according to data from Cox Automotive, the average cost of an electric vehicle decreased from $64,300 to $55,600. Depending on the range for recharge, low range vehicles could run as low as $36,000 and long range at $106,000 or more.

The Transportation Electrification & Infrastructure portion of HB 2165 directs an electric company to collect an amount ofone quarter of one percent of total revenues from retail electricity consumers and expend those funds to support and integrate transportation electrification. It also allows utilities to pass investment costs to customers that may include expenditures outside the utilities’ service territory. Where the cost of purchasing an electric vehicle may be a wash under the bill, every electric rate payer will see an increase in their service cost.

This bill is currently headed to the State Senate.


--Donna Bleiler

Post Date: 2021-05-06 10:23:23Last Update: 2021-05-11 15:47:19



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