Refinery-backed interests warn against expanding EV credits

Source: Jenny Mandel, E&E News reporter • Posted: Friday, September 21, 2018

A coalition of groups backed by the petrochemical billionaires Charles and David Koch is urging lawmakers to freeze electric vehicle tax credits, saying any expansion of existing subsidies for the vehicles would harm poor and middle-class households.

The groups behind the letter sent yesterday to House Ways and Means Chairman Kevin Brady (R-Texas) include the American Energy Alliance, Americans for Prosperity, the American Legislative Exchange Council (ALEC) and others founded or funded by the Kochs, whose family fortune comes from oil refining giant Rock Island Oil and Refinery Co., later renamed Koch Industries Inc.

“Congress has a responsibility to spare American taxpayers increased economic harm from a subsidy that benefits only those who can afford expensive electric vehicles,” the groups said in a statement. “Why should a typical middle class American family — with a median annual income of $44,000 — subsidize the lifestyles of the rich and famous?”

The letter calls on lawmakers not to expand a cap on the number of EV sales per company that are eligible for federal subsidies. Buyers of EVs get a federal tax break of up to $7,500 for the first 200,000 vehicles sold by each automakers; Tesla Inc. was set to exceed that cap this summer, as sales of its popular models have ramped up (Climatewire, July 16).

Koch-affiliated groups have increasingly been fighting the expansion of EV infrastructure planning, and the Edison Electric Institute, a trade group for utilities, fought back an effort by ALEC, the American Energy Alliance and others to wipe out state incentives for EVs and EV charging earlier this year (Climatewire, May 1).

Oil and refining interests have a lot to lose in a large-scale shift of vehicle fueling from gasoline to electricity. Plug-in EVs currently account for less than 1 percent of light-duty vehicles worldwide but could make up more than a quarter of all light-duty vehicles worldwide by 2040, according to the U.S. Energy Information Administration.