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The Case For Extending the EV Tax Credit

Capital Markets | Friday March 25th, 2011 | 0 Comments

The following open letter is a part of the Presidio Graduate School’s Capital Markets course. For one of the course assignments, students write a letter to an oversight body, government entity or other appropriate institution. The topic: changing the sector of capital markets that relates to their chosen topic so it reinforces principles of sustainability. Follow along here.

An open letter to Senator Max Baucus (D-MT)

Dear Chairman Baucus:

We are writing to urge you pass Senate Bill S. 232 to the Senate.S. 232 is currently being reviewed by the Senate Committee on Finance and needs your help to move to the Senate. This bill increases the per-manufacturer cap for the plug-in hybrid $7,500 tax credit from 200,000 vehicles to 500,000 vehicles. We strongly urge you to pass this bill to the Senate because it will promote electric vehicle adoption which will have the following dramatic benefits for the United States: revitalize domestic manufacturing, stimulate the economy, reduce transportation related emissions, and decrease U.S. dependence on foreign oil.

Electric vehicles (EVs) have the power to revitalize the declining domestic automotive industry and bring manufacturing jobs back to the U.S. However, like many disruptive technologies, EVs need government support to reduce the cost to American consumers in the early years while manufacturing becomes scalable and profitable. Currently EVs cost about $16,000 more than a similarly equipped gas vehicle; the tax credit is critically important to reducing the difference to a more manageable $8,500. For that, each EV owner will save about $16,000 in energy costs over the life of the EV and the American economy will be stimulated by $26,000 per vehicle.

Furthermore, over 33% of U.S. green house gas (GHG) emissions come from transportation. EVs, with zero tail pipe emissions, can significantly reduce this percentage. For example, the California Energy Commission shows that with the current electricity fuel mix in California, EVs reduce GHG emissions by 74%.

Chairman Baucas, there is no better time to support Senate Bill S. 232 than now. The key to our energy independence is to encourage Americans to buy EVs.  Last year alone, the United States sent $250 billion dollars to other countries for oil. By electrifying our transportation, we can eliminate our dependence on foreign oil.

For the health and wealth of our future, we strongly urge you to review S. 232 and recommend that it be passed by Senate. Thank you for your time and consideration.

Sincerely,

Max Dunn
Obrie Hostetter

CC: Orrin Hatch, Jeff Bingaman, Maria Cantwell, Benjamin Cardin, Thomas Carper, Thomas Coburn, Kent Conrad, John Cornyn, Mark Crapo, John Ensign, Michael Enzi, Charles Grassley, John Kerry, John Kyl, Robert Menendez, Bill Nelson, Pat Roberts, John Rockefeller, Charles Schumer, Olympia Snow, Debbie Ann Stabenow, John Thune, Ron Wyden, Barbara Boxer, Diane Fienstein


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