Fraser Forum

Electric cars still zapping taxpayers in Ontario

Printer-friendly version

Back in 1997, I pointed out the absurdity of electric car subsidies. Writing for Reason Magazine, I observed with regards to GM’s first battery-electric car, the EV-1 that:

Once you've finally got an electric car—GM's EV-1—limit eligibility to lease it to wealthy environmentalists who own at least one other gas-powered car, earn at least $100,000 a year, and have a garage (and wallet) big enough for a $2,500 wall charger. (By comparison, normal leases of GM cars don't have fixed income requirements, and don't differentially "favor" applicants based on how many other cars they own.) Next, build a bunch of $20,000 charging stations at taxpayer expense so that Jay Leno and Ed Begley can catch a quick charge on the way to a production meeting. And last but not least, use taxpayer money to subsidize wealthy EV buyers with $8,400 worth of rebates and tax credits to "ease the blow" of the $34,000 price tag.

You might think, after nearly 20 years of technological progress, that electric cars would be able to stand on their own four wheels and no longer require subsidies. You’d be wrong, and if anything, the inequitable nature of the subsidies has grown still more egregious.

As the CBC recently pointed out, Ontario’s has a positively shocking subsidy program for plug-in hybrid cars that, until recently, was giving out subsidies to purchasers of a $1.1 million car, Porsche’s 918 Spyder (pictured above). In fact, the government gave out five subsidies to Spyder buyers in Ontario at an average subsidy of $5,538 each. They also subsidized buyers of other high-end plug-ins giving

•  $362,032 in incentives to 64 wealthy Ontarians to buy the BMW i8, a car that currently retails at $150,000 in Canada.
•  $212,500 in subsidies to 25 drivers to buy the Fisker Karma (retail price: US$103,000, or roughly $130,000 Cdn ).
•  $170,000 in rebates to 20 buyers of the Tesla Roadster Convertible (retail price: US$109,000, or roughly $138,000 Cdn).

CBC puts the total payout for subsidized electric vehicles at almost $40 million since the program’s inception in 2010.

Ontario Premier Kathleen Wynne announced changes to the subsidy program, limiting it to cars under $150,000, but that still leaves plenty of room to reward conspicuous electric car drivers, however well-off, for adopting and showcasing technology that is unaffordable to the bulk of the population.

Blog Category: 

Subscribe to the Fraser Institute

Get the latest news from the Fraser Institute on the latest research studies, news and events.