Senate Finance Committee advances Clean Energy for America Act with $12,500 electric vehicle credit
President Joe Biden’s American Jobs Plan covers a lot of bases, including replacing transportation infrastructure, modernizing the electric grid, providing broadband internet, and creating affordable homes. Even the infrastructure proposal that’s currently being “negotiated” in the Senate (spoiler: Republicans are not actually negotiating) doesn’t cover every corner of the plan.
But one very important part of the plan did pass out of committee Wednesday. The Clean Energy for America Act, sponsored by Sen. Ron Wyden, emerged from the Senate Finance Committee on a party line vote. The bill reverses decades of tax advantages given to fossil fuels and instead provides incentives that produce zero or net negative carbon emissions. The new legislation takes a comprehensive approach, replacing a patchwork set of current guidelines and rewards that were tacked on to other bills over the years, and replacing it with straightforward benefits including a production tax credit up to 2.5 cents per kilowatt hour, or investment tax credit of 30%. By doing so, the bill would reward both companies who have already invested in wind or solar, as well as provide incentives for a more rapid transition away from fossil fuels.
The plan also includes major incentives for moving the transportation fleet to electric vehicles (EVs). It would restore tax incentives for cars and trucks made by manufacturers such as GM and Tesla, which have exceeded the sales limit of previous legislation, and it would expand the size of the tax rebate. Not only would the bill restore the base tax rebate of $7,500 on EVs, it would add another $2,500 tax credit for vehicles assembled in the United States, and a third credit of $2,500 for cars at produced facilities where workers are represented by a labor union. That means that consumers could see a rebate of up to $12,500 on EVs.
Making the bill even better, both of these incentives have “long sunsets.” Rather than being tied to just a few years, or, as is currently the case with vehicles, being limited to just the first few hundred thousand sales, these incentives would hang around until renewable energy and EVs were clearly dominating their respective markets. In the case of EVs, that would mean the incentives would only begin to phase out when more than 50% of passenger vehicle sales were fully electric.
https://www.dailykos.com/stories/2021/5/27/2032400/-Clean-Energy-for-America-Act-passed-out-of-committee-with-up-to-12-500-credit-for-electric-vehicles