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Electric Car, Scooter Buyers Get Immediate Tax BreakBy EV World Open Access Article Originally Published: February 20, 2009
Buried within the American Economic Recovery and Reinvestment Act of 2009, the $787 billion stimulus bill passed by Congress and signed into law by President Obama, is a modest, but important tax credit for a special class of electric vehicles. Known collectively as light electric vehicles or LEVs, these electrically-driven machines now qualify for a ten percent federal tax credit up to $2,500. Included for the first time in the amended federal tax credit code are two and three-wheeled electric vehicles. Also qualifying are four-wheeled, battery-powered neighborhood electric cars known as NEVs. In order to qualify for the credit, two and three-wheeled vehicles must have a battery pack with a minimum of 2.5 kWh of stored energy capacity. NEVs would have to have a 4 kWh battery capacity. Kilowatt hours are a standard measure of energy consumption based on watts consumed per hour with a kilowatt being 1000 watts. The battery storage capacity as measured in kilowatts is determined by multiplying the total amp hour capacity of the battery times its voltage, divided by 1000. In the case of the stylish Vectrix electric Maxiscooter, its battery pack is rated at 3.75 kWh arrived at by multiplying the pack's 30 amp hr capacity times 125 volts, divided by 1000. Thus the $11,000 Vectrix would qualify for a maximum $1,100 tax credit.
Similarly, a $8,500 GEM eS neighborhood electric vehicle pictured above would also fall within the provisions of the Act since its battery pack is calculated to be 9.36 kWh, well over twice the 4kWh minimum stated in the law. Unlike the tax credit provisions for plug-in hybrid electric vehicles like the Chevy Volt, which don't take effect until 2010, last minute changes to the stimulus bill allowed the credits for electric scooters and 3-wheeled vehicles like the Zap Xebra and Myers Motors NMG, as well as the Aptera to take effect as soon as the President signed the bill into law, which happened this week in Denver. The relevant section of the stimulus bill on page 217 reads: EFFECTIVE DATE.—The amendments made by this section shall apply to vehicles acquired after the date of the enactment of this Act. This comes as a huge relief to manufacturers, distributors and retailers of these vehicles, who had assumed the credits would not take effect until 2010. Struggling like much of the rest of the automotive industry, they too have seen their sales plummet, driven in large measure by falling oil prices. A twelve month gap in when their customers could start using the tax credit was seen by some as catastrophic. The light electric vehicle industry is breathing a bit easier today. END STORY
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