The race to electrify the road transport network is on. The Biden administration has provided $5 billion for the development of a nationwide network of public electric vehicle chargers, and automakers have pledged to spend billions of dollars developing new electric vehicle models over the next decade. However, the high prices of most EV models prevent a significant portion of the population from ditching their internal combustion engine (ICE) cars and going electric.
To help offset these costs and reduce the financial burden on buyers, the state of New Jersey will provide millions of dollars in financial incentives to EV buyers. State Governor Phil Murphy announced last week that New Jersey will fork out up to $4,000 to every driver who purchases an electric vehicle as part of wider efforts to reduce reliance on fossil fuel vehicles and fight climate change.
The state would also provide up to $250 to help drivers install private charging stations in their homes, as well as $4 million to be used as incentives for condos and apartment buildings to install charging stations for their residents on-site. In total, Murphy said, the 2022 Clean Energy Fund will provide around $60 million for the electric vehicle incentive program.
Speaking at an event held at Asbury Park, Murphy said that these incentives would encourage more drivers to purchase electric vehicles, especially as prices of the EVs are projected to become equal to comparable fossil fuel vehicles. Vehicles under $45,000 will be eligible for up to $4,000 in incentives while EVs priced from $45,000 to $50,000 will qualify for up to $2,000, the governor’s office said. Only New Jersey residents will be able to receive the incentives.
Another $4 million will be used to incentivize local governments to purchase zero-emission electric cars, with the Murphy administration dedicating $30 million in total to buying electric vehicles. Murphy noted that electric vehicles made up 5% of vehicle sales countrywide and that his administration wanted to help increase that percentage by making it easier for more New Jersey residents to buy electric vehicles.
At the moment, an estimated 65,000 EVs are registered in the state. The Charge Up New Jersey Program, which has provided incentives and contributed to purchasing more than 13,000 EVs in the past two years, is now in its third year. The program previously provided incentives of up to $5,000 for EVs under $55,000, but the incentives were recently reduced to $4,000 to spread out the funding and provide more incentives.
Such incentives are likely to bring the electric vehicles made by companies such as Workhorse Group Inc. (NASDAQ: WKHS) within reach for a lot more motorists, and EV penetration will happen at a faster pace.
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