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Congressional Budget Office Report on EV Tax Credits

Discussion in 'Energy, Environment, and Policy' started by Beavis, Jun 27, 2013.

  1. Beavis

    Beavis Model S Signature 991

    Dec 24, 2011
    Colorful Colorado
    #1 Beavis, Jun 27, 2013
    Last edited: Jun 27, 2013
  2. ggies07

    ggies07 Supporting Member

    Nov 8, 2012
    Ft. Worth, TX
  3. William13

    William13 Active Member

    Mar 19, 2011
    South Bend
    Thanks, I read the presentation. The last slide shows biofuels being cost effective reducers of CO2 emissions. Since I find this to be false I cannot agree with the CBO report in any way.
  4. CapitalistOppressor

    CapitalistOppressor Active Member

    Jun 18, 2012
    They've been peddling this line for over a year now (at a minimum). The real problem that they identify is how CAFE standards can wash out the contribution of EV's. This is because as more EV's are produced, that gives automakers more room to market cars with low gas mileage, while still meeting the standard. As a result, fleet wide effects (and emmissions reductions) of EV's are small.
  5. michaelwb

    michaelwb Member

    Apr 2, 2013
    Los Angeles, CA
    Not sure I agree with the report. You need both carrots and sticks to spur innovation. While CAFE at 54.5 MPG could theoretically reduce oil dependency all on its own, without a supportive policy environment (whether that be incentives, R&D funding, and/or higher gas taxes), you would have even less support from manufacturers who would resist compliance and argue, rather convincingly, that it's not feasible. The tax credits help to offset the costs incurred by early adopters, who help to drive costs down for the rest of the market down the road. It addresses the market failure associated with innovation: few will incur the costs of innovation if they can only capture only a fraction of the rewards, and the result is a less than socially optimal level of investment in the technology.

    Innovation is why we have a 4,700 lb 7-seater that accelerates to 60 in under 4 seconds and gets 89 MPGe. When it occurs, it benefits society at large. If we had to meet CAFE without EVs, we’d all be driving around in tiny, lightweight cars powered by clattery diesel engines.

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