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Electric Vehicle Tax Credits | Earth Wise

February 17, 2023 By EarthWise Leave a Comment

As of January 1, many Americans can qualify for a tax credit of up to $7,500 for buying an electric vehicle. The credit is one of the changes enacted under last year’s Inflation Reduction Act. The purpose is to encourage EV sales and thereby reduce greenhouse gas emissions and air pollution.

There has been a tax credit for EVs for more than a decade, but its provisions made cars from any manufacturer ineligible as soon as that manufacturer had sold more than 200,000 cars. Notably, this eliminated the credit for purchasing cars from Tesla and General Motors. Given that electric cars are now selling in the millions, the 200,000-unit cap on the tax credit essentially made it useless as a real force to grow the industry.

The new tax credit has a somewhat complex set of requirements for determining the applicability and amount of the credit. There are price limits on eligible vehicles depending on vehicle type and there are requirements on where vehicles are manufactured, where batteries are manufactured, and where other components are made. The intent is to encourage American manufacturing of the cars and trucks to the greatest extent. There are also income limitations on buyers who want to take advantage of the credit, but those are quite large. The Department of the Treasury has online detailed information about the requirements for the credit and, of course, EV manufacturers can provide the specifics for their own vehicles.

For their part, automakers are adjusting prices, building domestic manufacturing plants and battery factories, and otherwise trying to position themselves for their customers to take advantage of the credit.

The new law also provides a smaller tax credit for the purchase of used electric vehicles.

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Web Links

Electric vehicle tax credits explained: What’s new in 2023?

Treasury Releases Additional Information on Clean Vehicle Provisions of Inflation Reduction Act

Photo, posted December 9, 2022, courtesy of Choo Yut Shing via Flickr.

Earth Wise is a production of WAMC Northeast Public Radio

Chocolate And Deforestation | Earth Wise

February 14, 2023 By EarthWise Leave a Comment

The world consumes 7.5 million tons of chocolate a year. Americans spend an average of $145 a year per capita on chocolate. And we are not even the world leaders. The Swiss eat an average of 22 pounds per person and the overall European chocolate market is the world’s largest.

A market valued over $100 billion a year is bound to have its issues for the environment, human rights, and other social issues, and chocolate is no exception. The global cacao industry grapples with problems with child labor, poverty, deforestation, sustainability and other environmental issues. The response of companies across the industry varies greatly. A website called chocolatescorecard.com keeps track of how many in the industry are doing.

Recently, lawmakers in the European Union have been putting together a landmark legislative package that addresses deforestation risks in the supply chains of a number of commodities including cattle, timber, rubber, soy, palm oil, and cacao. The proposed law restricts companies that import cacao and sell chocolate to import only what doesn’t destroy or degrade forests.

Voluntary promises by big chocolate makers to save forests in major cacao-producing countries (like Ivory Coast, Ghana, Indonesia, and Nigeria) are difficult to keep. Farmers sell to brokers who sell to trading companies that then sell to chocolate makers. Tracing the origins of chocolate is difficult. Ultimately, fairly compensating farmers is the only way they are likely comply with deforestation regulations and there are unfortunately many pockets to fill before that is likely to happen.

It is up to consumers to encourage companies to do the right thing by making their buying choices appropriately.

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Web Links

The Forest in Your Chocolate

The Chocolate Scorecard

Photo, posted January 12, 2010, courtesy of Lee McCoy via Flickr.

Earth Wise is a production of WAMC Northeast Public Radio

Electric Cars Are Coming Sooner Than Expected | Earth Wise

September 30, 2021 By EarthWise Leave a Comment

It is widely believed that electrification is the future for vehicles. The only question is how long the transition will take. Predictions are all over the map, but the recent trend is to revise those predictions to say it will happen sooner than previously thought.

A recent report from the international accounting firm Ernst & Young predicts that EV sales in the US, China, and Europe will surpass those of fossil-fuel-powered vehicles five years sooner than previously expected. The report forecasts that fossil-fueled vehicles will represent less than 1% of global sales by 2045, taking their place among other historical but essentially abandoned technologies.

Europe is expected to be the leader in EV adoption. The forecast is that EVs will surpass legacy vehicles by 2028. China is expected to follow by 2033. The US is lagging behind, but even here, electrics are expected to achieve a majority of car sales by 2036.

Plug-in vehicle sales have surpassed a 10% market share in California and Tesla now has a 1.7% share of the total US car market. Norway is the global EV leader with 3 out of 4 car buyers choosing electrics. In that country, Tesla’s Model 3 is the top-selling vehicle of any kind. In Switzerland, 40% of car sales are EVs or hybrids.

There are many variables that will affect the timetable for the EV transition. Among them are the timetable for widespread use of autonomous vehicle technology, the effects of policy initiatives by governments around the world, the development of charging infrastructure, and the evolution of electricity generation and energy storage.

In any case, looking at the product roadmap for virtually every automobile manufacturer makes it clear that electric cars are the future.

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Web Links

Ernst & Young: Electric Cars Are Coming Sooner Than Expected

Photo, posted April 25, 2021, courtesy of Rutger van der Maar via Flickr.

Earth Wise is a production of WAMC Northeast Public Radio.