Model State Electric Vehicle Legislation

Section-by-Section Analysis

Section 1. Short title.

Section 2. Findings and Purposes.

The purposes of the Act are to create financial and regulatory incentives to promote the purchase or lease of electric vehicles within the State; to stimulate the development of infrastructure necessary to support the use of electric vehicles within the State; to reduce reliance on petroleum-based fuels within the State; and to improve air quality by increasing the use of nearly emission free electric vehicles.

Section 3. Statement of Policy.

The policy of States adopting the model legislation is to support the development and consumer acceptance of electric vehicles, and the corresponding development of infrastructure to support the use of these vehicles.

Section 4. Definitions.

Provides standard definitions of electric vehicle and associated equipment of an electric vehicle. Defines the term "electric vehicle infrastructure and support systems" broadly to include support and maintenance services and facilities, electricity delivery methods, consumer education programs, and battery availability and related programs that are necessary for the operation of electric vehicles.

Title I. REGULATORY PROVISIONS TO ENCOURAGE THE DEVELOPMENT AND USE OF ELECTRIC VEHICLES

Section 101. Exemption From Fees.

This section provides for the issuance of special electric vehicle license plates, and, as an incentive to the use of electric vehicles in the State, provides that vehicles bearing such special license plate shall generally be exempt from the payment of parking fees, unless such parking fees are dedicated to the repayment of identified debt obligations. This section would also exempt electric vehicles from motor vehicle registration or other fees for a period of ten years.

Section 102. Electric Rate Regulatory Treatment Of Electric Vehicle Programs In Areas Where Appropriate.

This section establishes a standard on which to determine whether the costs of an electric utility's electric vehicle programs may be recovered through the utility's rates in areas subject to alternative fuel fleet requirements. The standard provides that such costs may be added to a utility's rate base if the appropriate state regulatory authority determines that the program is "practicable, cost-effective, and beneficial to electric consumers."

The legislation requires the state electric utility regulatory authority to determine whether or not it is appropriate to implement the "practicable, cost-effective, and beneficial to electric consumers" standard. A determination that the standard is appropriate shall be made if the electric vehicle program is likely to result in more efficient utilization of the utility's existing generating facilities or is likely to decrease the utility's air pollution control costs, and if the long-run benefits to the utility produced therefrom are likely to exceed the long run costs of the electric vehicle program to the utility.

The authority that regulatory bodies would have under other law to determine that such a standard is not appropriate is expressly preserved. Similarly, a savings provision is included to provide that this section does not limit the authority otherwise available under state law to provide for recovery of utility electric vehicle program costs.

For purposes of this section, an "electric vehicle program" of a utility means one through which the utility provides or assists in providing any one or more of the following: recharging facilities; equipment or facilities to deliver electricity to the electric vehicle; other electric vehicle infrastructure and support systems; or electric vehicles themselves, through direct purchases or leases of the vehicles or contributions to customer's purchase, lease or operation costs.

Section 103. Study To Determine Advisability Of Mobile SourceTrading Of Emission Reductions.

This section requires the State to study the extent of emission reductions produced by the operation of electric vehicles, and whether such reductions may be expressed as "credits" that may be banked, traded, or used to offset emissions from stationary sources. The study required by this section shall address modifications to State Implementation Plans (SIPs) and other laws or regulations to permit mobile/stationary trading of emissions credits; the methodology for quantifying emissions reductions, and the extent to which emissions reductions are enforceable; the methods to provide for voluntary scrapping of high-emitting existing motor vehicles, along with the options for coordinating such a program with programs to encourage the use of electric vehicles; the methods to monitor pollutant reductions and to allocate the "ownership" of pollutant reduction credits; and such other matters as the State agency deems necessary.

Title II. FINANCIAL INCENTIVES PROGRAM TO ENCOURAGE THE USE OF ELECTRIC VEHICLES.

Section 201. Electric Vehicle Tax Credit.

This section would grant a credit against state income tax for a) a percentage of the amount expended by automobile dealerships or other vehicle maintenance facilities to purchase and install equipment to be used specifically for servicing and maintaining electric vehicles; and b) a percentage of the cost of an electric vehicle purchased by any taxpayer (individual or corporate). These provisions would include a phase-down of the credit as production and utilization of electric vehicles within the State increases, and a sunset date.

Section 202. Exemption From State Sales And Use Tax.

This section exempts electric vehicles from any State sales or use taxes.

Section 203. Exemption From Personal Property Taxes. This section directs that electric vehicles be exempted from any State or local taxes levied on personal property.

Section 204. Authority To Issue State Bonds To Finance Electric Vehicle Programs.

This section could authorize the issuance by the State of bonds, either general obligation or special revenue bonds, the proceeds of which could be utilized to finance designated electric vehicle programs. The requirements of particular states would have to be considered in drafting specific legislative language. In addition, a revenue stream to be used to service the bond debt/provide for principal repayment would have to be identified in conjunction with any special revenue issue.

Section 205. Electric Vehicle Loan Guarantee Program.

This section could authorize the State to create a loan guarantee program, through which the State would guarantee principal and interest payments on loans taken out by fleet operators for the acquisition of electric vehicles or on loans used to acquire capital equipment necessary to establish electric vehicle support and maintenance facilities. The costs of this program would be financed through imposition of a guarantee fee, which would be deposited in a default reserve. If the default reserve contains less than 10 percent of the total principal value of guaranteed loans outstanding, no further loan guarantees could be issued.

Title III. INFRASTRUCTURE DEVELOPMENT AND DATA ACQUISITION PROGRAM TO SUPPORT THE USE OF ELECTRIC VEHICLES.

Section 301. Development Of Comprehensive State Electric Vehicle Plan.

This section requires preparation of a comprehensive State electric vehicle plan in conjunction with local governments, utilities, and the private sector. State plans are to be consistent to the extent practicable with any Federal electric vehicle financial incentive programs, and shall be designed to maximize State access to Federal programs available for electric vehicle development and demonstration programs and infrastructure development projects (such as the new initiatives in this area enacted as part of the Energy Policy Act of 1992.) Comprehensive State plans must address, at a minimum, issues of availability of electricity, the provisions necessary to meet a goal of introducing a "substantial number" of electric vehicles by the year 2000, and the specific requirements and cost of implementation of the plan. Further, State plans must describe the coordination with Federal and local government entities, and include recommendations regarding: use of high occupancy vehicle (HOV) lanes by electric vehicles; State and local tax exemptions; State and local government fleet electric vehicle use; preferential parking at public facilities; on-street preferential parking; building code modifications to accommodate and support electric vehicle use; public education programs; training programs for O&M, safety and garaging of EVs, rate treatment of electricity sold for use in electric vehicles; means through which the State could facilitate construction and reconstruction of electricity transmission and distribution facilities; and provision of public recharging facilities.

Section 302. Selection Of Joint Venture Electric Vehicle Infrastructure Development Projects.

Not later than one year after the appropriation of funds for this purpose, the State shall select for funding a maximum of five electric vehicle infrastructure demonstration joint venture projects. Each joint venture will involve participation by the State and a non-state entity, which may be a for-profit business or a nonprofit organization, a private foundation, a trade or professional society or a local government unit. At least 50 percent of the cost of each joint venture must be provided from other than State funds. Joint ventures may address: equipping existing facilities to service electric vehicles and associated equipment; installation of charging facilities; rate structure design and other financing methods to encourage electric utilities to invest in infrastructure capital-related expenditures; public information programs; and development of safety and health procedures and guidelines related to operation and maintenance of electric vehicles.

Electric Vehicle Association of the Americas
701 Pennsylvania Avenue, N.W.
Washington, D.C. 20004

January 15, 1996