White House proposes $1 billion National Community Deployment Challenge, seeks to reform and increase EV tax credit

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Alternatively powered vehicles such as those powered by compressed natural gas (CNG) and electrical plug-in vehicles are getting some much appreciated love — and perhaps increased funding — from the federal government this week. Speaking at a Daimler Trucks North America plant in North Carolina, President Obama recently announced that his administration is proposing to increase federal support for CNG vehicles by introducing and implementing a tax credit similar to the currently enjoyed with electric vehicles.

Additionally, consumers who were on the fence about purchasing an electric car may now have two good reasons to do so. The President is looking to reform the current tax credit in exchange for a point-of-sale rebate making it immediately available and applicable at the time of purchase. In contrast, the current system sees that credit given at the time of filing your taxes. President Obama is also seeking to increase the federal credit from its current $7,500 up to $10,000 all in an effort to support the President’s new initiative for support of advanced vehicles. In doing so, the Obama administration has expressed its intention on making electric vehicles as affordable and convenient to own and operate as gasoline-powered vehicles by the end of the decade.

Among the President’s new initiatives to support advanced vehicles is a “Race to the Top” challenge. This initiative would seek to encourage advanced vehicle adoption by spending $3.7 billion on tax credits and a further $1 billion towards 10 to 15 communities in order to “invest in the necessary infrastructure, remove the regulatory barriers, and create local incentives to support deployment of advanced vehicles at critical mass.” The White House has pointed out that this challenge is “fuel neutral” and “would allow individual communities to determine if electrification, natural gas, or other alternative fuels would be the best fit.”

Another of the President’s proposed initiatives is the “EV Everywhere” plan. This initiative, designed by the Department of Energy, seeks to bring together “America’s best and brightest scientists, engineers, and businesses” in an effort to “solve the most pressing energy technology challenges of our time.” This, according to the White House, would essentially translate to the government investing even more money in advanced and alternative energy research ranging from fast charging technology to electric drivetrains.

Clearly the Obama administration is trying to push alternative energy, it’s funding, and subsequent practicality pretty heavily. While many skeptics remain on the fence, the White House says that driving an electric car will translate into a savings of roughly $100 per month for the average driver. That might not seem like a lot now, but once the upfront cost of purchasing alternatively fueled vehicles is reduced, it may well be. Whether it will be enough to persuade EV detractors and opponents of the Obama administration, however, remains to be seen.

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