- USA Today
Federal budget analysts expect policies and tax breaks encouraging the purchase and manufacture of electric vehicles will cost about $7.5 billion over the next seven years.
The non-partisan Congressional Budget Office released a report Thursday on how federal tax credits have affected sales of electric vehicles. Those credits range up to a maximum $7,500 for the average plug-in hybrid.
In the report, analysts said the lifetime costs of owning a electric vehicle are still "generally higher than those of a conventional vehicle or traditional hybrid of similar size and performance," estimating a plug-in vehicle costs, on average, between $16,000 and $19,000 more than a comparable gas-engine vehicle.
But gas-electric hybrids, which also deliver large improvements in fuel economy, are selling for much smaller premiums over their gas-only counterparts. For example, the 2013 Ford Fusion hybrid that goes on sale this fall will have a base price of $27,995, about $5,000 less than the top-of-the-line Titanium gas-engine version with all-wheel drive.
The CBO report said that an electric or plug-in hybrid would "require a tax credit of more than $12,000 to have the same lifetime costs" as a comparable gas-only vehicle.
Lower electricity prices and cheaper batteries, or higher gas prices, could improve the case for plug-ins, the CBO analysts noted.
The report said consumers who buy electric vehicles buy less gas, but the tax credits may enable automakers to sell more low-fuel-economy vehicles and still comply with federal standards for their overall fleet.
"Consequently," CBO said, "the tax credits will have little or no impact on the total gasoline use and greenhouse-gas emissions of the nation's vehicle fleet over the next several years."
But that contradicts data from the U.S. Energy Information Administration. The EIA reported that in 2011, total gasoline consumption in the U.S. fell to 3.19 billion barrels from a record high of about 3.39 billion barrels consumed in 2007.