09.22.11

Cantwell, Crapo Introduce Bipartisan Bill to Encourage Technologies that Can Make Electric Cars More Efficient and Affordable

Tax Credit Will Reward Dynamic Washington State Companies Like AFS Trinity of Bellevue and EnerG2 of Seattle Already Working on More Proficient Electric Car Systems

WASHINGTON, D.C. –Today, U.S. Senators Maria Cantwell (D-WA) and Mike Crapo (R-ID), both members of the Senate Finance Committee, introduced bipartisan legislation that would help foster technological innovation and investment in improving plug-in electric vehicle performance by making a current tax credit more technology neutral. Senators Risch (R-ID) and Wyden (D-OR) are also cosponsors. 

Under current law, which Senator Cantwell authored in 2007 with Senator Hatch (R-UT) and Senator Obama (D-IL), the tax credit for plug-in electric vehicles is based only on battery capacity, rather than overall battery performance. Specifically, plug-in electric vehicles sold today with at least a 16 kilowatt battery capacity qualify for a $7,500 tax credit. The CHARGE (Changing How America Reduces Greenhouse Emissions) Act aims to improve vehicle efficiency and lower purchase costs by allowing storage devices that work in combination with batteries in order to achieve functionality equivalent of at least a 16 kilowatt battery pack to qualify for the maximum credit amount.

The CHARGE Act could benefit innovative Washington state companies, such as AFS Trinity of Bellevue and EnerG2 of Seattle, which have developed ultracapacitor technology that allows plug-in electric vehicles to use smaller, less-costly batteries while achieving the same performance as the larger capacity batteries.

“The CHARGE Act improves a key tax incentive that is helping create a new class of cars that can save consumers money and help reduce America’s dependence on foreign oil,” Cantwell said. “It awards innovators who are figuring new ways to make electric cars more affordable and efficient to the benefit of consumers and our nation’s energy security.  I’m proud that Washington state is on the forefront of this movement.”     

“The law as currently written ironically gives more credit for a larger battery and ignores technologies that can propel a plug-in hybrid vehicle more efficiently, with less mass,” said Edward W. Furia, CEO of AFS Trinity, a clean-tech company headquartered in Washington State with an engineering center in Livermore, California. “The way the current law works is like rewarding the cars with the biggest gas tanks instead of the best fuel economy. I’d like to thank Senators Cantwell and Crapo for their leadership in seeking to amend the tax credit to reward efficiency.”

Under current law, the plug-in electric vehicle credit begins at $2,500 for plug-ins that use batteries with 4 kilowatt hours (kWh) of capacity. Every extra kilowatt hour of battery power after that, up to 16 kWh, is worth $417. The CHARGE Act would amend this credit to also reward plug-ins that use more efficient, smaller batteries and other storage technologies which can achieve the same amount of power.

"The tax credit for plug-in electric vehicles is vital to accelerate the pace of adoption of this clean technology which enhances our environment and promotes energy security,” said Rick Luebbe, CEO of EnerG2.“This amendment improves the effectiveness of the tax credit by encouraging a broader range of innovative technical approaches.  Washington State businesses are leading many of these innovative development efforts and we applaud Senator's Cantwell's efforts to address this opportunity"

According to a 2011 report by the Pacific Northwest National Laboratory, plug-in electric vehicles can play a critical role in stabilizing the power grid and facilitating the broader integration of wind, solar, and other renewable energy technologies.  They can also help to level the load on the U.S. power grid, reducing the need for investment in new generating and transmission capacity.  Another groundbreaking PNNL study from 2007 found that plug-in electric vehicles have the potential to displace 52 percent of U.S. oil imports and reduce U.S. carbon dioxide emissions by 27 percent annually.

Cantwell was instrumental in creating the $7,500 consumer incentive to buy plug-in electric vehicles in 2007 along with Senator Orrin Hatch (R-UT) and then Senator Barack Obama (D-IL).  The incentive became law as part of a clean energy tax package Senator Cantwell authored with Senator Ensign (R-NV) in October 2008.  Building on this consumer incentive, in 2009 Cantwell co-authored bipartisan legislation (the FREEDOM Act) with Senator Hatch to help ensure the United States establishes and maintains global market leadership in plug-in electric vehicle and component production.

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