The electric car is back. With an assist from government, Nissan delivered the first models of its new electric vehicle (EV) to customers earlier this month, and thanks to a $100 million Federal program hundreds more will be on the road soon. Nissan is the first manufacturer out of the gate, but others are expected to offer EVs for sale in the next couple of years. While governments at the Federal, state, and local levels have been heavily involved in the roll-out of EVs, the new Congress will decide whether EVs will continue to receive government support.
The primary rationale for continued government support is that EVs can help wean the US off of its addiction to oil. Each day, the US burns 380 million gallons of gasoline, and more than 60 percent of oil consumed in the US is imported. But with 255 million oil guzzling registered vehicles in the US today, even the most optimistic forecasts predict that it will take decades before EVs meaningfully contribute to a reduction in oil consumption.
EVs have also been touted as a means for creating jobs and stimulating the struggling car industry. To that end, the February 2009 Recovery Act included $2 billion in grants for battery and component manufacturers, and the DOE’s Advanced Technology Vehicles Manufacturing loan program, passed by Congress during the Bush Administration, has lent $2.4 billion to support the development of EV factories. Perhaps no state has leveraged Federal money as successfully as Michigan, which is looking to revitalize its auto industry. By offering packages of tax credits in combination with Federal incentives, the state has attracted eighteen companies developing advanced batteries, an effort that the Governor predicts will generate 63,000 jobs. (more…)