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How to make EVs more affordable

June 23, 2021
With a variety of resources to help decrease the overall costs of electric vehicle adoption, fleets can begin to transition out of diesel- and gas-powered trucks.

Grants, rebates, vouchers, income tax credits, sales tax exemptions, make-ready funding. These are just a few of the options available to help bring down the cost of electric vehicles (EVs).

Like it or not, the reality is that today’s EVs have higher upfront costs than their internal combustion engine counterparts. On top of that, the residual value/resale value is unknown as are recycling/disposal requirements.

In the fifth training in NACFE's Electric Bootcamp, we assembled a panel to talk about incentives and why we need them. Basically, the goal of incentives is to jump-start the adoption of EVs by lowering the incremental cost—the difference between the cost of an EV and a diesel- or gas-powered truck.

Much of the currently available support is focused at the point of sale with vouchers to knock down the initial purchase price. One example of such a program is from the New Jersey Economic Development Authority. Victoria Carey, senior project officer at NJ EDA, explained that the NJZip—New Jersey Zero Emissions Incentive Program—has $15 million in vouchers available for purchasers of medium-duty electric vehicles, with $5 million of the funds set aside for small businesses.

Kyle Winslow, federal policy director at CALSTART, said that small fleets can’t overcome the upfront incremental cost of EVs and incentive programs are designed to make EVs affordable to fleets of all sizes.

Programs to speed EV adoption are not just occurring in the U.S. Canada has programs in place too including one that is designed to make sure charging is where it needs to be. According to Jess Dawe, policy analysts, clean fuels branch of Natural Resources Canada, that is the point of the country’s Zero Emissions Vehicle Infrastructure Program.

Joel Donham, lead engineering consultant at the Center for Transportation & The Environment, said CTE performed an analysis for EV use in three markets to gauge the impact of incentives on the life cycle cost of EVs.

The three markets were:

  • San Francisco, which has low electricity rates and high incentives
  • Shreveport, which has low electricity rates and low incentives
  • Cleveland, which has high electricity rates and low incentives

The project looked at purchase vouchers, efficient charging, energy costs and LCFS revenue.

He also offered Bootcamp attendees some best practice tips:

  • Make sure the truck you are considering meets your needs
  • Evaluate and anticipate costs
  • Research available incentives
  • Manage operations

With that last tip being very important. Once you have purchased your EV, monitor its use and identify unanticipated cost drivers and opportunities to improve.

Given all we learned in the Bootcamp, I don’t think anyone should use the increased incremental cost of an EV as an excuse not to buy one. Based on what I've heard, there seems to be many incentives out there to bring incremental costs down and plenty of people who are willing to help you find out about those incentives. What are you waiting for?

Michael Roeth has worked in the commercial vehicle industry for nearly 30 years, most recently as executive director of the North American Council for Freight Efficiency. He currently serves on the second National Academy of Sciences Committee on Technologies and Approaches for Reducing the Fuel Consumption of Medium and Heavy-Duty Vehicles and has held various positions in engineering, quality, sales and plant management with Navistar and Behr/Cummins.

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