High Gas Prices, Government Rebates Drive Hot B.C. Market for Electric Vehicles
Sky-high gas prices, together with up to C$10,000 in government rebates, are forecast to give a serious boost to an already healthy electric vehicle market in British Columbia.
While EV ownership is B.C. is already at a 15% share of the new vehicle market, nearly double the national average, CBC reports, the province is poised for a further surge in sales.
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“It’s the perfect storm in British Columbia right now,” said University of Calgary economics professor Blake Shaffer. “You’ve got very high fuel prices—$1.70 at the pump—while at the same time you’ve got two levels of government offering pretty compelling incentives.”
In a recent policy paper on whether governments should be subsidizing EVs at all, Shaffer “crunched the numbers around the economics of EVs and rebates” and discovered that B.C. drivers “stand to save a lot of money if they choose an EV over a popular model internal combustion engine vehicle—and not only because of the thousands of dollars in incentives.”
Savings will continue to accrue after purchase, he found. Whereas a B.C. road trip of 100 kilometres currently costs around $18 in the nation’s top-selling truck, the Ford F-150, and around $12 in its most popular car, the Honda Civic Sedan, the same trip in a top-selling EV costs $2 to $4.
And then there are those “pretty compelling” rebates: on May 1, the federal government began offering $5,000 towards the purchase of an EV, on top of the $5,000 already available under the province’s Clean Energy Vehicles for B.C. program.
While past federal EV rebates “weren’t very equitable, because they tended to benefit higher-income earners who could afford an expensive new electric vehicle,” Shaffer praised the new measure for limiting rebate eligibility to vehicles priced at less than $45,000. A further step in the direction of equity would be to make the rebate “a taxable benefit,” he added, thereby “imposing a larger cost on higher-income bracket households.”
While EVs currently cost more than similar fossil models, “Shaffer figures that with fuel savings and the rebates combined, it would take only two years to pay back the extra expense,” CBC reports.