What about the rebates? BC's fast and furious electric vehicle targets questioned

As BC hits the accelerator on its zero-emission targets for motorists, there’s concern the switch from fossil fuels is too fast and furious for the industry.

Last month the provincial government announced it would be speeding up the deadline for automakers and auto sellers to make a major change, and it comes in five years earlier than the previous target.

“The [Zero-Emission Vehicles Act] amendments will require automakers to meet an escalating annual percentage of new light-duty ZEV sales and leases, reaching 26% of light-duty vehicle sales by 2026, 90% by 2030 and 100% by 2035,” the province said.

It will mean a ban on the sale of gas-guzzling vehicles by dealerships in just over 11 years and put a lot of pressure on automakers to roll out more and more electric vehicles in that same timeframe.

But, stakeholders were quick to suggest the province pump the brakes. The New Car Dealers Association of BC (NCDA) put out a statement warning of the unintended consequences of the move.

“The legislation includes a penalty structure through which automakers face the prospect of a significant penalty for every vehicle sold under the ratio along with a corresponding reduction in the number of vehicles available for sale in this market. New Car Dealers fear a combination of financial penalties and reduced inventory have the potential to drive up the price for all vehicles, both new and used,” the association wrote.

Adding the post-pandemic supply chain issues continues to affect inventory and inflation.

“There are several issues that may impact the current trajectory. Post-pandemic supply issues continue to affect inventory. Even with incentives, ZEVs are still unaffordable for many British Columbians, and we lack a comprehensive charging network,” NCDA president and CEO Blair Qualey said.

Despite those concerns, a BC Hydro study found there’s a lot of interest from consumers in buying anyway. Of the 40% of British Columbians looking to buy a new vehicle in the next three years, at least three-quarters of them are interested in electric.

EV costs

Charging stations for electric-battery vehicles. (VisualArtStudio/Shutterstock)

It’s not only electric vehicles that are out of reach for many financially, but for those who are willing to spend in this economy, it might not be as much of a reach to buy green.

The price of buying an electric vehicle has deterred some people from investing. One user wrote that they were wary about the added costs.

“I’ve been struggling because I want to invest in electric but [I[ also have a budget. I do qualify for the tax credit and the all wheel drive and rear wheel drives are more in my price range. So I’m extremely conflicted on what to do,” one person said on Reddit.

That question of investing in electric is a no-brainer, supporters say.

“ZEV’s usually do have a higher upfront cost, but their operating and maintenance costs are on the lower end,” the Ministry of Energy, Mines and Low Carbon Innovation argued.

“Last year, a study conducted in Canada compared models of internal combustion engine cars with their electric equivalents. With the exception of one pair, it found that electric cars are cheaper to own in the long run. For most cars, you pay off the difference in upfront costs in a year or two,” it said.

Adding that, a new report from Clean Energy Canada shows that some electric vehicles are already the same price.

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The price of a vehicle has long been the argument against going electric. Not only have many Canadians seen growing debt and a higher cost of living, but they might not be able to take advantage of the financial incentives.

The price of the vehicle is among the biggest factors preventing those from getting a rebate. There are two rebate programs available if someone is buying an electric vehicle in BC, and a driver could get up to $5,000 from the federal program and $4,000 from the Clean BC program if they qualify. Most importantly, you need to be pre-approved.

Things like your income, the age and mileage of the vehicle, and other factors all play into whether you’re eligible for the cash and, if so, for how much.

Currently, the MSRP cap in BC is $55,000 for cars and $70,000 for larger vehicles.

The super popular unofficial ride of Vancouver, the Tesla, has only a few models that fall within that eligibility. Among them is the Tesla Model Y, which has confused many over its $9,000 eligible rebate as it looks similar to a car but is actually a crossover SUV and falls under the larger cap with a price tag of $67,000 for the 2023 model.

The price of the 2024 model, however, is being widely speculated, with some suggesting an increase and others suggesting a drop-off in price for the EV rides, putting them closer to price parity with gas-powered competitors. If these vehicles get more expensive, will the governments move the eligibility higher and higher?

The confusion

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These questions have dominated the conversation for many who don’t want to miss out on a deal. In recent months, many wannabe Tesla drivers were up in arms after they were told the rebates had dried up for the year. It sparked a lot of anger and headlines, but the province said the rebate pot had been replenished shortly after and no one was left without their savings.

It’s not the first time, as the program has been so popular that it’s run out several times over the last six years.

We put the question to the Ministry of Energy, Mines and Low Carbon Innovation to ask to clear up some of the confusion and to look into the crystal ball for the future.

As more and more vehicles are required to be zero-emission in the coming years, how will the rebate program adapt to that?

“The program is funded by BC Hydro’s revenues from the sale of low carbon fuel standard credits, and funding is expected to cover anticipated rebate numbers for the remainder of 2023,” the ministry said to appease concerns about anyone hoping for a rebate this year.

Plus, the program will be offering up savings in 2024 as well, as long as the new models continue to fall under the MRSP threshold.

Federally? You can get the rebate for the next two years.

“The Incentives for Zero-Emission Vehicles (iZEV) Program is continuing until March 31, 2025 (or until available funding is exhausted),” the website reads in part.

Stefan Malloch/Shutterstock

Despite the program benefits, many people expressed their confusion regarding the eligibility and requirements since they make too much money.

People making less than $80,000 a year could collect $2,000 to $4,000 depending on the vehicle’s mileage. Applicants making $90,000 to $100,000 can get $500 to $1,000.

Those making over $100,000 a year are not eligible for the provincial rebate following an overhaul of the program in 2022 after critics pointed out taxpayer dollars were being awarded to those buying luxury vehicles, and lower income earners were missing out.

“Looking to finance an electric vehicle purchase. Has anyone had their lower income spouse apply for the rebate to max it out at $4000 but used the higher income spouse (or both incomes together) for the loan qualification? Is this allowed?” One person asked on Reddit.

Others weighed in to say they had done it, and it worked out fine.

The province says as long as the household income is between $125,000 and $165,000, a couple could also still qualify for a full or partial rebate.

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Many others say they won’t even have the conversation until they see more charging stations.

“It’s been a year and a half and we still can’t get a viable quote to install a “few” EV chargers in the condo. Forget everybody 😭” one recent Reddit poster lamented.

“As a person working in the electrical utility sector in bc, I can tell you our power grid isn’t near ready to support all the additional charging needs,” another person said.

While there have been major multi-million dollar investments on every level into car charging infrastructure, critics are quick to say it’s still not where it needs to be and nowhere ready for 2035.

“The NCDA suggests an ongoing commitment by government in new public, fast-charging stations and a funding top-up for the Go Electric EV Charger Rebate Program are important steps in building the infrastructure required to keep pace with the adoption of electric vehicles,” The New Car Dealers Association of BC said.

Adding it’s “encouraging the provincial government to leave the door open for a flexible approach to Zero Emission Vehicle Act regulations.”

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What do you think of BC’s plan for a greener future? Let us know in the comments.