Ontario, Canada, Boosts Electric-Car Purchase Rebate Amounts

As U.S. electric-vehicle advocates are well aware, a handful of states have reduced or killed incentives for plug-in vehicles over the past year, adding some headwinds to sales.

Earlier this month, the Canadian province of Ontario took the opposite approach, expanding its plug-in electric vehicle incentive program. It's a welcome tailwind.

The new initiative isn't entirely surprising, as the province has burnished its green credentials in recent years, notably phasing out its use of coal.

DON'T MISS: When Electric-Car Incentives Return: British Columbia Case Study

Premier Kathleen Wynne was also the Minister of Transportation when the province's first incentive program was introduced six years ago, so she may have a deeper appreciation of the history than many of her provincial or state peers.

Ontarians previously received a purchase rebate ranging from $5,000 to $8,500 based on the battery size of their plug-in electric car.

Electric Vehicle Purchase Rebate program, Ontario, Canada

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The now-discontinued Toyota Prius Plug-In Hybrid's 4.4-kilowatt-hour battery earned the minimum rebate, while vehicles with batteries of 16 kWh or more earned the maximum.

The new rebates have been set at $6,000 to $10,000 for vehicles with 5- to 16-kWh batteries, respectively--and cars with batteries larger than 16 kWh qualify for a further $3,000 rebate.

Autos with five or more seats qualify for an additional rebate of $1,000, perhaps in recognition that four-seaters such as the BMW i3 and first-generation Chevy Volt don't offer quite the same utility.

Lastly, in a nod to the tenuous optics of offering rebates to luxury-car buyers, purchase rebates are capped at $3,000 for vehicles with a Manufacturer's Suggested Retail Price above $75,000--and do not apply to cars costing more than $150,000.

British Columbia reinstates its incentives for plug-in electric car purchase, February 2015

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As a patient public servant told us:

"Our decision to cap incentives for vehicles with a MSRP of $75,000 reflects the trend toward more affordable [electric cars] coming to market – vehicles that will appeal to more and more Ontarians.

"However, EVs still carry a significant price premium when compared to an equivalent gasoline vehicle. Our modernized Electric Vehicle Incentive Program will help make these vehicles more affordable to the average family.

"We will continue to provide incentives for vehicles at the higher end of the range, but it is increasingly difficult to justify providing incentives to high-income earners for vehicles that may likely be purchased regardless of the incentive. That is the reason we are focusing the program's funds where it makes the most sense: on mid-range vehicles."

Tesla fans may be disappointed that the Model S and X will only qualify for $3,000 in provincial rebates.

2016 Tesla Model X with 2011 Tesla Roadster Sport, photographed by owner Bonnie Norman

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But even if the company's Model 3 arrives late, it should qualify for a whopping $14,000 in incentives, because the program presently has no cap.

Quoting the same government representative:

"At this time, the program does not have a specific end date. However, we will be regularly reviewing the incentive program to ensure it is responsive to industry trends and emerging technologies."

Rebates will also be capped at 30 percent of manufacturer's MSRP, meaning that buyers won't be able to buy the Smart Electric Drive for half-price. (Smart ED buyers would otherwise receive $13,000 in rebates for a $26,990 vehicle.)

The government webpage listing rebates for qualifying plug-in electric vehicles can be found here.

Next-best to ZEV?

Policy analysts and advocates are nearly unanimous in agreeing that a California-style Zero Emission Vehicle (ZEV) mandate is the best way to ramp up plug-in electric vehicle adoption at a rapid pace. If automakers are required to sell such vehicles, they'll do so, cross-subsidizing from the rest of their product lines.

ALSO SEE: Canadian Plug-in Electric Vehicle Study: 1 Percent To 30 Percent Is The Challenge

Of course, ZEV mandates are very, very difficult to implement politically--and California is something of a special case.

Wealthy and populous, the state is a big enough auto market that carmakers can't afford to simply stop selling cars there.

In addition, the earliest regulatory efforts by the California Air Resources Board were aimed at fighting smog, a visible pollutant and lung irritant which tended to galvanize voter support more than does carbon dioxide, the colorless, odorless greenhouse gas.

Source: Ontario, Canada, Boosts Electric-Car Purchase Rebate Amounts