Washington motorists will gain access this summer to new state rebates – up to $9,000 in some cases – to help cover the cost of leasing or purchasing electric vehicles.
Gov. Jay Inslee and state Department of Commerce Director Mike Fong provided details Tuesday about the program, which will be available at auto dealerships beginning in August. Swapping gasoline-powered vehicles for electric ones is a key priority with the state’s Democratic-led efforts to transition away from fossil fuels and slow climate change.
While the number of EVs in the state has nearly doubled over the past two years, many are fancier models and the cars tend to be heavily concentrated in the Seattle area. Inslee said the new program is meant to help “democratize” the emerging automotive technology.
Single Washington residents earning up to $45,180 annually or a family of four with income up to $93,600, will be eligible for a rebate of up to $9,000 for a new electric vehicle lease of three years or more. They’d also qualify for up to $5,000 for a new EV purchase or two-year lease. Used electric vehicles are eligible for a $2,500 rebate on purchases and leases.
How the program could work
The Department of Commerce provided the example below for how the rebate program could play out for someone looking to lease a vehicle.
A dealer is advertising a three-year lease at $239 per month with $1,999 due at signing – for a total lease cost of $10,364. For a qualifying customer, the $9,000 state rebate brings the lease cost down to $1,364. The dealer applies a $500 lease fee, $200 documentation fee, and collects state and local transit, title and registration fees of $734.
The final lease totals $2,798, or $78 per month over the 36-month agreement.
Fong described the program as a “first-in-the-nation model.” His agency said in a press release that the state rebates, combined with federal and automaker incentives, could make monthly lease payments on at least four EV models less than $100 for qualifying consumers.
In March, there were about 181,400 electric vehicles registered in Washington, including plug-in hybrids, according to Department of Licensing data. That’s up from around 94,000 in March 2022. Despite the growth, EVs remain a small share of the roughly 8 million vehicles registered in Washington.
State figures also show just over half of the EVs registered are in King County and around 40% are Teslas. Tesla prices its least expensive car, the Model 3, at about $39,000.
EV prices have been coming down. But estimates updated in January from Cox Automotive and Kelley Blue Book still pegged the average cost for a new electric vehicle at around $55,353, whereas the overall average price for new cars at that time was around $47,401.
Local listings in western Washington show new Chevy Bolts available for around $27,000 or to lease for $400 to $500 a month. Nissan Leafs sell in the $30,000 price range. The starting price for a new, gasoline-powered Toyota Carolla is around $22,000.
The federal government already provides tax credits up to $7,500 for electric and plug-in hybrid vehicles.
But these incentives are only available when purchasing vehicles that meet certain requirements for where they were built and where the materials in their batteries came from. There are also income eligibility guidelines with the federal program. The federal credit can also be factored into lease prices without the same restrictions on vehicle models.
Funding for the Washington initiative is from the state’s general fund. It is not coming out of revenue from carbon auctions under the Climate Commitment Act.
Commerce announced about $85 million of spending in February for nearly 5,000 new electric vehicle charging stations. Gaps between charging sites remain a concern for EV drivers, especially in more rural and outlying areas. Some EV owners have also struggled with their vehicles in colder weather, which can sap batteries.
The Washington State Standard is a nonprofit, nonpartisan news outlet that provides original reporting, analysis and commentary on Washington state government and politics. We seek to keep you informed about Washington’s most pressing issues, the decisions elected leaders are making, how they are spending tax dollars and who is influencing public policy. We’re part of States Newsroom, the nation’s largest state-focused nonprofit news organization.
