Program participation is three times higher than expected, driven by low-cost leases



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News Release




September 27, 2024


EV instant rebates prove popular: Funds are more than half spent

*Program participation is three times higher than expected, driven by low-cost leases*

OLYMPIA, Wash. --- Rebates are going fast with the Washington State Department of Commerce’s Electric Vehicle (EV) Instant Rebate Program [ [link removed] ], which helps low-income drivers lease or buy EVs. More than 3,300 Washington residents have received rebates in less than 60 days since the program’s launch.

At the current pace, funding is now expected to run out in October, said Steven Hershkowitz, Commerce’s Clean Transportation Program managing director. There is not currently additional funding appropriated for the program. When the program launched August 1, Commerce estimated funding could last until next spring, but participation has far exceeded expectations due to two factors: The level of participation is about three time higher than forecasted, and the $9,000 three-year lease option was even more popular than expected.

“In real time, we are validating our research that EVs are popular with people at all income levels,” said Department of Commerce Director Mike Fong, referencing Commerce’s Transportation Electrification Strategy [ [link removed] ]. “Vehicles are rolling out of dealerships so much faster than we expected – drivers wanting to take advantage of the program should act within the next month before funds run out.”

As of Sept. 24, the program has provided 3,351 rebates, with 64% – 2,145 – for leases. Fifty-five percent of the program’s nearly $45 million budget has been spent, Hershkowitz said. The average rebate so far is $7,292. At the current pace, he expects the state to issue about 6,000 rebates.

“Including low-cost leases in the program design is a game-changer,” said Commerce Energy Division Assistant Director Michael Furze. “Washington is the first state to prioritize low-cost leases as part of an EV incentive program, and the fact that two of every three rebate recipients are choosing this option shows it is the most effective way to accelerate the transition to an equitable EV market.”

Hershkowitz said the program is currently on pace to create $2.84 in benefits within five years for every $1 spent on the program. This is due to the social cost of carbon avoided (which includes positive health outcomes), fuel savings from switching from gasoline to electric, and upfront vehicle cost savings now and in three years when leased vehicles enter the used market or are kept by current drivers. This estimate takes into account a key indicator of program success: 90% of rebate recipients say they couldn’t have bought or leased an electric vehicle without the rebate. This far exceeds California’s EV rebate program [ [link removed] ], which previously achieved a 66% rate for low-income participants, according to research by their program administrator.

The program is also achieving its intended goal of increasing access for low-income households. According to program data from August, the average rebate recipient comes from a household making an annual income of $51,975.

There are 308 participating dealers statewide, including nearly all franchise dealerships, direct-to-consumer automakers (such as Tesla) and independent dealers. Dealer participation has exceeded expectations, Hershkowitz said; his office and Commerce’s program administrator, Energy Solutions, regularly check in with participating dealers to get feedback and provide support.

“It’s exciting to see how strong the demand for EVs is in Washington,” says Christine Riker, vice president at Energy Solutions, “We’re encouraged by how quickly dealers have understood the value of the program in helping them serve low-income customers.”

Funding is from the Electric Vehicle Incentive Account, which was created in 2022 from state general funds. More than $65 million remains in the account for future iterations of the program if appropriated by the Legislature.

*How customers will know if rebates are still available*

Starting this week, the webpage WAInstantRebates.org will be updated with funding remaining in the program. If the website’s Dealer Hub page [ [link removed] ] says incentives are available, dealers can complete a lease or sale with customers and include an instant rebate.

A specific program end date will be announced when funding is nearly exhausted. Commerce is not setting a program end date at this time. This allows flexibility to maximize available funding. Commerce plans to provide dealers and customers at least a few days’ notice through a future announcement.

*How the program works*

Individuals and households making up to 300% of the federal poverty level [ [link removed] ]qualify for the rebate program, which is an instant discount of $2,500 to $9,000 at point of sale or lease. The driver must be a Washington resident who registers the vehicle for personal use with the Washington State Department of Licensing.

Interested drivers will go to participating dealers to learn about low-cost lease and sale offers available under the state instant rebate program. The dealer will get a signed attestation that the buyer meets the income requirements of the program, and determine that their credit score qualifies for a lease deal. The dealer then deducts the applicable rebate amount from the cost of the lease, then applies dealer, state and local fees to arrive at the total lease amount.

The new rebate isn’t the only incentive to switch to electric. There’s also a $7,500 federal EV tax credit available to purchase select new EVs, and $4,000 for used EVs under $25,000. There are also incentives of up to $7,500 available for leases. The state rebate can be added to both the federal credit – which is now available at the point of sale instead of on tax returns, depending on the dealership – and a statewide sales-tax exemption for some vehicles.

*Rebate amounts*

New EVs

* State rebate to purchase or two- or three-year lease: $5,000
* State rebate for 3+ year lease: $9,000
* Federal rebate to purchase select models: $7,500

Used EVs

* State rebate to purchase or two- or three-year lease: $2,500
* State rebate for 3+ year lease: $2,500
* Federal rebate to purchase select models: $4,000

Full battery electric vehicles with manufacturer’s suggested listed price below $90,000 are eligible, not including motorcycles, scooters and low-medium/speed vehicles, such as golf carts.

 

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Media Contact

Amelia Lamb <[email protected]>, Commerce Communications, 360-995-3386






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