Members of the Legislative Regulations Review Committee (LRRC) are meeting on Nov. 28 to determine the fate of gas-powered cars in the state, and they are only being told part of the story by the Department of Energy and Environmental Protection (DEEP).
In a startling revelation, a recent Texas Public Policy Foundation (TPPF) study has challenged the narrative surrounding electric vehicle (EV) affordability. TPPF found that the average model year (MY) 2021 EV would cost $48,698 more to own over a ten-year period without $22 billion in government subsidies given to EV manufacturers and owners.
According to the report, the true cost of EVs should factor subsidies paid by taxpayers; indirect subsidies in the form of avoided fuel taxes and fees; energy investments funded by utility ratepayers; and higher vehicle costs driven by mandates and environmental credits.
The report does not include the hundreds of billions of dollars provided through the Inflation Reduction Act.
While advocates claim Connecticut EV drivers pay a mere $1.35 per gallon equivalent for electricity, the research reveals the startling truth: EV owners are, in fact, with all variables considered, paying a staggering $17.33 per gallon.
During the regulation adoption process, DEEP conducted a four-hour public hearing on Aug. 22, and received roughly 4,000 written testimonies. As required by law, DEEP issued a report outlining the mandate, detailing the key arguments for and against it. The report also summarizes and addresses all comments made regarding the proposal.
In response to concerns about the high cost associated with purchasing an EV and the anticipated increase in electricity bills, DEEP seemed unmoved. Per their calculations, the ten-year savings are estimated to be $8,835 along with taxpayer-funded rebate programs.
Their report highlighted that EVs, lacking emission control equipment like catalytic converters, will experience reduced maintenance or replacement costs (since there is an uptick in stolen parts.)
The cost savings DEEP reports do not take into account the increases in tax and utility bills.
According to the report, taxpayers — over ten years — will be on the hook for $8,984 to pay for federal and state EV tax credits and rebates. Additionally, there’s a cost of $1,318 for subsidized public charging stations.
Utility ratepayers shoulder a burden of $10,515 in increased costs enabling the electric grid to accommodate mass-scale electric charging through increased power generation, transmission and distribution during that same ten years.
DEEP is also overlooking the financial strain placed on those unable to afford or finance an EV due to poor credit. These individuals are not going to be thrilled to know that their household expenses will rise to subsidize EVs for wealthier members in their communities.
Consumers of gas-powered vehicles are expected to see price hikes due to mandates compelling manufacturers to sell a specific quantity of EVs. This requirement, coupled with federal regulatory standards set by the Environmental Protection Agency and the Corporate Average Fuel Economy standards has an estimated cost of $27,881 over a period of ten years.
DEEP also states that “economies of scale and technological advances may drive down costs over time” and that “as the number of available EV models increases” prices will be comparable to gas cars.
Car manufacturers are singing a different tune. Last week (Oct. 26), the Ford Motor Company revealed that it won’t be pouring as much money into EVs. This decision follows a significant financial blow, with a reported loss of $1.3 billion in the third quarter — more than double its loss from the same period in 2022. Ford disclosed that it incurred a loss of approximately $36,000 for each EV sold during the quarter. Consequently, Ford has announced plans to reduce their intended EV investments by $12 billion.
GM also reported last week a quarterly profit loss of $1.5 billion and revealed plans to delay the launch of several EV models as a cost-cutting measure. This decision came after their earlier announcement that they would be postponing the construction of a second factory dedicated to the production of electric pickup trucks.
In another setback, GM and Honda, who had joined forces in 2022 to manufacture EVs priced below $30,000, decided to dissolve their partnership due to demand that fell short of expectations.
According to TPPF, “despite massive incentives, EVs are receiving a tepid response from the majority of Americans who cannot shoulder their higher cost” and that “inventory is stacking up in dealer lots for several brands as sales are not keeping pace with government-mandated production.”
TPPF predicts that it is “likely that automakers will be requesting even more direct subsidies in the coming years,” a burden that would ultimately fall upon taxpayers.
As the LRRC gears up for it meeting at the end of the month to decide whether to ban the sale of gas cars by 2035, a crucial decision hangs in the balance. The question on everyone’s mind is will they listen to DEEP’s virtue signaling about potentially saving the world from CO2 or will they push back against this regulation, considering its potentially significant financial impact on Connecticut residents?
Time is Running Out to Stop the Gas Car Ban. Let Your Voice Be Heard!
Click HERE to let the Legislative Regulation Review Committee know this is not what Connecticut residents want from our politicians!
This Week on Yankee’s podcast Y CT Matters
Brent Bennett from the Texas Public Policy Foundation takes a deeper dive into his report on the true costs of electric vehicles.
Click HERE to listen