Study: Californian Clean Vehicle Incentive Program Has Disproportionately Benefited The Wealthy −


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Published on November 12th, 2016 | by James Ayre

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Study: Californian Clean Vehicle Incentive Program Has Disproportionately Benefited The Wealthy

To date, California’s clean vehicle incentive program has disproportionately benefited people living in wealthy, majority “white” neighborhoods, according to a new study published in the journal Transportation Research Record.

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The new findings come from two researchers analyzing data on the 98,901 rebates issued to Californians “buying or leasing low-emission vehicles from the inception of the Clean Vehicle Rebate Project in 2010 through March 2015.”

Amongst the findings was the fact that around 83% of rebate users during the time period in question apparently made more than $100,000 a year.

The press release provides more: “While a state law passed in 2014 requires that 10% of CVRP funds be allocated to disadvantaged communities, Rubin and St-Louis found that residents of neighborhoods with a majority Hispanic or African American population are less likely to have applied for, and therefore be benefiting from, clean vehicle rebates, even when income is held constant. For example, as the share of Hispanics in census tracts increases by increments of 10%, the number of rebates decreases by 0.54 per thousand households.”

“Even when income was accounted for, people of color were still less likely to be using those rebates,” stated Evelyne St-Louis, a recent graduate of UC Berkeley’s master’s program in city and regional planning. “That’s perhaps the problem. The CVRP program was funding households that could afford those vehicles anyway. These households may have been slightly incentivized by a rebate, but the marginal difference it could make to them is more narrow than for a lower- or middle-income household.”

“Nonparticipation by low-income people and people of color shows us that barriers prevent these groups from accessing CVRP subsidies. We can surmise that this is partially attributed to the auto industry targeting wealthier areas with marketing campaigns, and also because information and guidance about electric vehicles and subsidy programs is not distributed evenly across all populations,” St-Louis continued.

A possible reason for this finding that’s not mentioned explicitly by the researchers is that electric vehicle (EV) uptake has to date largely been a cultural/tribal affair — with most buyers doing so because of hearing good things from their friends and family, and/or because of what an EV symbolizes culturally. Or, for that matter, what a Tesla symbolizes culturally (wealthy, high-tech, on the cutting edge, etc.).

Different groups of people possess different ideas about what’s valuable or desirable, and this certainly applies to automotive choices. “Environmentally friendly” and “high-tech” aren’t things that factor into many people’s automotive purchasing processes, but the people who do heavily weigh those things tend to have more money.

Consider the current ubiquity of nearly non-functional trucks driven by people that have never used them for actual work.

Notably, as a result of earlier criticism along the lines of the new research, California has already moved to somewhat limit the access of the ultra-wealthy to the incentives. Beginning on November 1, 2016, a gross annual income level qualification cap went into effect — $150,000 for single tax filers; $204,000 for head of household filers; and $300,000 for joint filers.


 

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About the Author

‘s background is predominantly in geopolitics and history, but he has an obsessive interest in pretty much everything. After an early life spent in the Imperial Free City of Dortmund, James followed the river Ruhr to Cofbuokheim, where he attended the University of Astnide. And where he also briefly considered entering the coal mining business. He currently writes for a living, on a broad variety of subjects, ranging from science, to politics, to military history, to renewable energy. You can follow his work on Google+.



  • Martin Lacey

    Without the rich buying EV’s there would never be a mass produced EV for the masses. Whilst the Bolt and Model 3 are still relatively expensive the industry is moving southward in price. The wealthy by taking incentives have helped us all.

  • Petr Nejedly

    With the 3rd generation of BEVs entering the market soon (Bolt, Tesla Model 3), the previous crop of cars is now on heavy sell-out and with all the incentives and subsidies, they may be among the cheapest new cars on the market. Even for folks that don’t earn enough to fully utilize the tax break themselves, there are leasing arrangements that still let’s them get the full benefit. Used are even cheaper, but you need to do your homework really well to not get burned.
    So I am afraid that the biggest adoption obstacle for lower income population is that they either generally drive longer distances or/and don’t have the home-charging access. I am myself limited to public charging (living in an apartment building), which makes my EV “fuel” cost comparable to the (currently cheap) gas.

  • Andy_02

    Hate to say it but some of the poor out there are poor because they made bad lifestyle decisions. If you don’t care enough to try and better yourself, chances are you don’t give a rat’s ass about EV’s or the environment either.

  • Ed

    Logically, only the wealthy can afford a Tesla. But remember this: At each opportunity, Musk thanks current Model S and Model X owners for their commitment to Tesla, saying that their commitment has been the key to allowing Tesla to continue to invest. Nearly every Tesla owner I have met agrees that we pay a premium of about $50-60 K for the vehicle, funds that allow Tesla to invest in new designs, tooling, gigafactories, factory expansions, Supercharger networks, store buildout and more. It is an equation that works.

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