California Continues to Lead Nationwide EV Adoption With Strong Incentives

Through the first half of 2023, nationwide EV adoption is growing quickly. According to JD Power, a leader in consumer insights, advisory services, data, and analytics, “On a nationwide basis, EV adoption rates have continued to rise steadily, with EV sales now representing 8.6% of the total new-vehicle retail market.” Nationwide, EV adoption is up one index point compared to the same period in 2022.

Tesla leading the pack with 63% of all U.S. EV sales year to date in 2023

Tesla leads EV adoption in the United States for several reasons. Tesla has been at the forefront of EV innovation, offering cutting-edge technology, impressive range, and high-performance vehicles since it moved to mass production of EVs before any other company. Additionally, Tesla has developed a robust charging infrastructure, including its extensive Supercharger network, which gives Tesla owners confidence in long-distance travel. Furthermore, Tesla’s brand recognition and reputation for quality have contributed to its leadership in the American EV market.

Other OEMs catching up to Tesla in 2023 EV sales

In a July 2023 article by CNBC, Hyundai, Kia and General Motors are Tesla’s closest competitors, citing data from Motor Intelligence. The same parent company owns Hyundai and Kia, and the company increased its EV sales by 11% during the first half of 2023. GM more than quadrupled its electric car and truck sales compared to the same period last year.

California continues to lead the other states in EV adoption

As the electric vehicle revolution evolves quickly in the United States, California continues to lead the other states in EV adoption. This accelerated adoption of EVs in California can be attributed to a combination of favorable government policies, increased consumer awareness, and substantial investments in charging infrastructure. California’s state government has introduced incentives such as tax credits, rebates, and grants to make EVs more affordable. Furthermore, the state’s stringent emission standards and commitment to reducing carbon footprint have spurred the proliferation of EVs. California’s robust tech industry and affluent consumer base have also contributed to the widespread acceptance of this emerging technology.

Utilities and commissions are important sources of funding. One example is The California Energy Commission (CEC). The CEC recently opened applications for $38 million in equity-focused incentives to fund publicly accessible electric vehicle (EV) charging stations in low-income and disadvantaged communities, according to Clean Technica. Increasing charging availability like this is one of the ways EV adoption is supported. It is important to support low-income and disadvantaged communities, as they are some of the most under-served communities in regards to EV adoption.

Top Ten states for EV adoption in September 2023

According to J.D. Power’s recent data, the top ten states in the United States leading the way in electric vehicle (EV) adoption are California, Washington, Hawaii, Massachusetts, Oregon, Nevada, Maryland, Colorado, Arizona and Utah. These states enjoy their top ten positions due to strong statewide government support for electric vehicle adoption.  EV adoption continues to grow in these states.

California offers a wide variety of EV incentives

California provides many incentives to encourage the adoption of electric vehicles (EVs), a few of which are listed here. The Clean Vehicle Rebate Project (CVRP) offers rebates for the purchase or lease of qualified vehicles. The amounts of these rebates can vary, but they can be quite substantial. Additionally, low-income residents may be eligible for the Enhanced Fleet Modernization Program (EFMP), which is a voluntary vehicle scrap program. The California Electric Vehicle Infrastructure Project (CALeVIP) provides incentives for the installation of EV chargers in commercial sites and public areas. California EV drivers can also benefit from High Occupancy Vehicle (HOV) lane access, regardless of the number of passengers in the car.

Washington provides substantial EV programs to encourage EV adoption

Washington State offers a variety of incentives to promote electric vehicle ownership. One of the primary benefits is the sales tax exemption for new and used electric vehicles, making EVs more affordable for prospective buyers. According to a May 2023 statement by Washington Governor Jay Inslee, Washington state will invest $69 million per year to install EV charging stations across the state, with an emphasis on serving multifamily residents, which are one of the top under-served segments of the EV driver population nationwide. In December 2022, Washington updated its Clean Vehicles Program, requiring that all new cars offered for sale in Washington to be hydrogen-fueled, electric, or hybrid with a minimum range of 50 electric-only miles.

Hawaii’s strong commitment to electric vehicle adoption

Hawaii offers several incentives and tax credits to promote the use of electric vehicles (EVs). The Electric Vehicle Charging System Rebate Program, run by the state energy office, provides up to $35,000 for the installation of EV charging stations at workplaces and multi-unit dwellings. As of September 2023, the program has installed 257 charging stations, utilizing over $1.1 million in state rebates. These rebates include charging stations installed at affordable housing projects. Additionally, EV owners can benefit from High Occupancy Vehicle (HOV) lane exemptions and free parking at state and county lots, encouraging more residents to make the switch to environmentally friendly vehicles. These initiatives contribute to Hawaii’s goal of achieving 100% clean energy by 2045, according to the U.S. Energy Information Administration (EIA).

Statewide programs in Massachusetts encourage EV adoption

Massachusetts offers several incentives to encourage the use of electric vehicles. Through the Massachusetts Offers Rebates for Electric Vehicles (MOR-EV) program, residents can receive up to $5,000 for the purchase or lease of a new electric vehicle. The Massachusetts Electric Vehicle Incentive Program (MassEVIP) provides up to 60% of the funding for workplaces and fleets to install EV charging stations, promoting the facilitation of EV infrastructure. The program is capped at a maximum of $50,000 per street address. These initiatives underline the state’s commitment to reducing carbon emissions and fostering a sustainable future.

Oregon’s Department of Environmental Quality provides rebates and more for EV adopters

In the state of Oregon, several incentives are offered to promote the use of electric vehicles (EVs). The Clean Vehicle Rebate Program, managed by the Oregon Department of Environmental Quality, provides cash rebates for Oregonians who purchase or lease electric vehicles. The cash rebates offer a stronger incentive than tax credits offered in other states. It includes the standard rebate for new electric vehicles and increased incentives for low or moderate-income drivers. The program ran out of funding on May 2023, but is expected to return in March 2024. Additionally, the Charge Ahead Rebate offers even more rebates for used EVs. The Charge Ahead Rebate is also out of funding and is expected to return in 2024 as well. Furthermore, Oregon also offers rebates ranging from $4,250 – $5,500 per charging port or up to 75% of eligible project costs, whichever is less, for eligible businesses, public entities, tribes, and multifamily home complexes who install electric vehicle charging stations.

Nevada Electric Vehicle Rebate Program offers valuable incentives for EV drivers

In the state of Nevada, several incentives are offered to promote the use of electric vehicles (EVs). The Nevada Electric Vehicle Rebate Program is a state initiative designed to encourage the purchase and use of electric vehicles (EVs). Under this program, low income residents of Nevada who purchase or lease a new or used EV are eligible to apply for a $2,500 rebate towards the purchase of a new or used EV. This environmentally conscious initiative not only helps reduce the state’s carbon footprint but also supports the growth of the sustainable transportation market.

Maryland offers rebates for chargers, a tax credit for EV purchases, HOV lane access and more

The state of Maryland offers several incentives to encourage the use of electric vehicles (EVs). The Electric Vehicle Supply Equipment (EVSE) Rebate Program provides a rebate for residential and commercial customers who install EV charging equipment, covering up to 50% of the equipment and installation costs. The rebates are capped at $700 for residential, and $5,000 for commercial rebates for each charger. Additionally, there’s an Excise Tax Credit for plug-in electric vehicles, which can offset the cost of purchasing a new EV, effective July 1, 2023 through June 30, 2027. The credit is capped at $3,000 and is offered one time only. Maryland also offers preferential parking options and the use of High Occupancy Vehicle (HOV) lanes for EV owners to encourage more drivers to shift towards electric mobility.

Colorado provides innovative Motor Vehicle Credit

The state of Colorado provides a variety of incentives to encourage the adoption of electric vehicles (EVs). These include the Colorado Innovative Motor Vehicle Credit, which is a significant incentive offering tax reductions to individuals who purchase or lease new electric and plug-in hybrid vehicles. The value of the credit depends on the capacity of the vehicle’s battery, incentivizing the adoption of models with larger, more efficient batteries. Effective July 1, 2023, the innovative motor vehicle credit increased to $5,000 for the purchase or lease of a qualifying electric or plug-in hybrid electric vehicle. The Innovative Truck Credit does not offer this increase, instead it will increase beginning in 2024. These programs are a key part of Colorado’s strategy to decrease reliance on fossil fuels, decrease carbon emissions, and promote cleaner transportation.

Arizona Alternative Fuel Vehicle (AFV) tax credit is a key financial incentive

In an effort to promote the use of electric vehicles (EVs), the state of Arizona offers several financial incentives, including tax credits and rebates. This includes the Alternative Fuel Vehicle (AFV) tax credit, which potentially reduces the costs associated with purchasing an electric vehicle, hence fostering sustainability and reducing carbon emissions. It aims to alleviate the cost associated with such a transition, thus making sustainable transportation more accessible. For AFVs registered between January 1, 2022, and December 31, 2022, the assessed value of the AFV is 20% of the manufacturer’s suggested retail price (MSRP); Every year after, the assessed value of the AFV is reduced by 15% from the value from the preceding year. The AFV tax credit not only helps reduce the initial purchase price of an electric vehicle but also furthers Arizona’s commitment to promoting clean energy and sustainability. Arizona offers EV drivers access to HOV freeway lanes at any time, regardless of the number of passengers.

Utah’s tax credit specifically targets the commercial sector

Utah does not offer an incentive for passenger vehicles, however the state offers the Alternative Fuel Heavy-Duty Vehicle Tax Credit Program. This initiative specifically targets the commercial sector, providing a tax credit to businesses that purchase or convert heavy-duty vehicles to run on alternative fuels, including electricity. The program is intended to support the transition of commercial fleets to cleaner, more sustainable fuel sources, thereby reducing the transportation sector’s overall environmental impact. The amount of the tax credit depends on several factors, such as the type of alternative fuel used and the weight rating of the vehicle, for up to 10 AFVs or $500,000 annually . Moreover, the state encourages the development of EV charging infrastructure, which further facilitates the switch to electric mobility.

Ten states with the lowest EV adoption

Despite the increasing popularity of electric vehicles (EVs) in the United States, certain states must catch up in their adoption rates. As of the latest data, the bottom ten states in terms of EV adoption are: Michigan, Kansas, Iowa, Mississippi, Louisiana, West Virginia, North Dakota, South Dakota, Wyoming, and Arkansas. It’s crucial to note that these rankings can change over time as more incentives are introduced and infrastructure improves.

Disparity in EV adoption between the states is increasing

Disparity between the states for EV adoption is an ongoing problem. The top states enjoying the lead in EV adoption have seen increases in their EV numbers thanks to state government support and other factors. Alternatively, the bottom ten states listed above are experiencing decreased numbers for EV adoption. This reduction in EV adoption is due to governments in those states needing to take the appropriate actions to make EVs affordable for their citizens, such as adding more incentives. These disparities are evidence of the states’ geographic, socioeconomic, political, and cultural divisions.

How EV adoption can be improved for the less successful states

Its clear that more nationwide efforts need to be made to help the states lagging behind the others in EV adoption. EVinfo.net would like to see more attention paid to these states. The federal government should step in and give additional assistance to these states to help get them up to speed. These efforts would benefit the entire country, significantly boosting the local economies in those states and improving air quality nationwide.

Why EV adoption is beneficial for all states

EV adoption is beneficial for several reasons. Electric vehicles have a significantly lower carbon footprint than traditional gasoline-powered cars, helping reduce greenhouse gas emissions and combat climate change. EVs offer lower operating costs as electricity is generally cheaper than gasoline. Additionally, EVs contribute to improved air quality by reducing local air pollution since they produce zero tailpipe emissions. Adopting EVs can decrease fossil fuel dependency, promoting energy independence and security. EVs need less maintenance than internal combustion engine (ICE) vehicles, providing a more favorable total cost of ownership (TCO).

California can serve as an example for other states

California’s success can be duplicated in other states, if the governments and other agencies in those states would step up and realize the need to improve their EV adoption rates. EVinfo.net recommends those states increase their incentives such as tax credits, rebates, and grants, and implement more campaigns to increase public awareness about the many benefits of switching to electric transportation.

See Electrek’s guide for all major incentives currently available for each state. State governments are encouraged to learn from successful programs in other states, such as the incentives in Electrek’s list. EV adoption is beneficial for many reasons, including cleaner air, reduced costs for owners, and reducing dependence on foreign governments for oil imports. Above all, the need to fight climate change remains a key reason to drive electric, as EVs have no emissions that increase greenhouse gases.