Electric vehicles can save drivers money in the long run, but adoption is hindered by high costs (~$66k on average in the US) and short supply.
A new climate bill, passed by the Senate and expected to clear the House this week, could help — or make things harder, Axios reports.
How it works
The bill includes $370B+ in climate and energy-focused spending and tax incentives. Some relevant provisions for EV buyers and producers include:
- $7.5k in tax rebates when buying US-made EVs (up to $4k for used EVs)
- $2B in grants to revamp auto manufacturing facilities for clean vehicle production
- $20B in loans to build manufacturing facilities for clean tech
But getting that tax rebate…
… could be tough. To meet eligibility, a vehicle’s battery must have:
- ~40% of its components made in North America or by a US trade partner by 2024
- 100% of its components made in North America by 2029
This is a problem, because the EV battery supply chain in the US is underdeveloped. Currently, only ~30% of EVs in the US qualify for the tax credit, and none meet the qualifications for 2029.
Some experts believe the bill would be more climate-friendly if the tax credits applied to all EVs.
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