WASHINGTON -- Electric vehicle and clean-energy proponents are urging Congress to preserve a consumer tax credit they insist is critical to mass adoption of the technology.
On Wednesday, 22 mayors sent a letter to members of the House and Senate conference committee rushing to finalize a massive package of tax cuts by the end of the year, saying the $7,500 tax credit helps them pursue clean-energy investments in their cities.
"The increased consumer demand for electric vehicles that arose through this tax credit has resulted in the creation of 200,000 new jobs in the U.S. automobile industry, driven technological innovation, reduced oil dependency, saved consumers money, and generated economic benefits," said the letter, signed by mayors from large and midsize cities, including Atlanta; Salt Lake City; Portland, Ore.; and Columbus, Ohio.
The House version of the tax bill would eliminate the tax credit, while the Senate voted to keep it.
EVs are more expensive to produce, and the federal rebate helps offset the increased cost of the vehicle.
Under current law, the credit is applied for each automaker until 200,000 EVs are sold, at which point the credit is halved at six-month increments over a year and then expires. So far, no automaker has reached the 200,000 threshold.
"Congress designed the credit this way to promote multiple manufacturers' investment and to allow the plug-in electric drive vehicle manufacturers to achieve commercial-scale production and the attendant reductions in per unit costs, while maximizing consumer options," the Electric Drive Transportation Association said in a separate letter to negotiating chiefs Sen. Orrin Hatch, R-Utah, and Rep. Kevin Brady, R-Texas.
The association represents automakers, suppliers, energy companies and technology developers.
Almost 40 models of plug-in and fuel cell cars are available today, and automakers continue to add vehicles with electric powertrains to their portfolios, although they represent only 1 percent of overall sales. The credit has been essential in driving sales of the mainstream Chevy Bolt and Nissan Leaf, as well as for premium all-electric brand Tesla, according to salespeople and clean-energy advocates.