Utilities push for electric car tax credit

In a letter to House Ways and Means Chairman Kevin Brady, longtime Ford lobbyist Ziad Ojakli thanked the Texas Republican for his work to advance tax reform, especially slashing the corporate tax rate.

Brady’s package, he wrote Nov. 7, will “help make our nation more competitive by supporting American investment and jobs.”

Absent from the letter? Any mention of the $7,500 tax credit for purchasers of

electric cars, something the tax legislation Brady is shepherding would eliminate.

The upside of tax reform has made many of the biggest automakers reluctant to put their lobbying muscle fully behind a fight to preserve an incentive for a market that only represents 1 percent of sales. Taking their place at the forefront of the issue is an unlikely alliance of environmental groups and utilities.

The Electric Drive Transportation Association — a group that includes power companies — has taken the lead on pressing for the issue, rather than the auto industry’s primary advocacy groups.

“It’s not a lack of commitment as much as it is a division of labor,” John Bozzella, chief executive officer of the Association of Global Automakers. “We’re working on multiple fronts through several organizations to get a good, balanced and effective comprehensive tax bill.”

A Senate version of the bill would preserve the credit, according to Republican Sen. Dean Heller, potentially leaving the issue to be settled by a conference committee and signaling weeks of lobbying.

Ford sold about 25,000 plug-in hybrid or pureelectric vehicles last year, according to Bloomberg New Energy Finance, including versions of its Focus, Fusion and C-Max hatchback. By contrast, the Dearborn, Michigan-based carmaker sold more than 820,000 F-Series pickups.

“Our focus in tax reform is on key elements that will help put American companies on a level playing field globally,” said Christin Baker, a Ford spokeswoman. “We will continue to promote electrification through other policy initiatives.”

While General Motors supports the overall tax effort, it’s the only automaker to say publicly that it planned to convince tax-writers to keep the credit, saying it “believes in an all-electric future.” The company plans 20 new electric models by 2023 to join the all-electric Chevrolet Bolt on sale now. Sales of the Bolt, along with the Volt plug-in hybrid, have made its customers a top user of the credits.

While they often butt heads with carmakers, environmental advocates are “fully involved in this fight,” said Andrew Linhardt, deputy legislative director for transportation issues at the Sierra Club.

“Our goal is to defeat this bill,” he said, noting that the group opposes the tax plan for several reasons in addition to how it treats the EV tax credit.

At their side in this fight are some of the nation’s largest utilities, which produce the power that recharges electric cars.

“The existing tax credits have been a powerful way to promote the use of electric vehicles,” said Neil Nissan, a spokesman for Duke Energy Corp., the secondlargest U.S. utility by market value. “Duke Energy supports the ongoing discussions with policymakers on the best way to continue this progress.”

Ending the credit early would upend the dynamics of the U.S. electric vehicle market, though the impact is not equal among carmakers.