New Jersey is stepping up its electric vehicle promotional efforts, adding a fourth year to its main purchase incentive program and $13 million to a separate fund to encourage municipalities to buy electric trucks.

The fourth year of the Board of Public Utilities (BPU) program known as Charge Up New Jersey opened for applicants on July 12 with the same maximum available incentive as in the last round: $4,000 for the purchase of a vehicle priced below $45,000. However, the agency has cut the incentive for a vehicle priced between $45,000 and $55,000 to $1,500, from $2,000 in the third year.

The program, which awards incentives totaling at least $30 million a year, so far has paid out $73.5 million in incentives, providing subsidies for more than 16,000 vehicles, according to the BPU. That is equal to about 17.5% of the 91,560 EVs the New Jersey Department of Environmental Protection (DEP) reported in the state at the end of 2022. Yet EVs still account for less than 4% of the 2.53 million vehicles of all types research firm Statista said were on New Jersey roads in 2021.

The new phase of the Charge Up program is part of a multipronged state effort to promote EV purchasing and stimulate the development and installation of EV chargers to remove potential buyers’ range anxiety.

The push coincides with the release of New Jersey’s second Strategic Funding Plan for the state Regional Greenhouse Gas Initiative (RGGI) for 2023-2025. Transportation is the state’s largest source of greenhouse gas emissions, at just over 40%. It’s one of four spheres of focus in the RGGI plan, which says the goal is to “continue to drive the transition to electric transportation throughout the state, with a focus on electrifying light-, medium- and heavy-duty vehicles benefiting environmental justice communities.”

Expanding Charger Access

As part of the push, the BPU began soliciting new applications on July 12 for three programs designed to incentivize the development and installation of electric chargers. They include the EV Tourism Charger Program, which provides incentives of up to $5,000 for a Level 2 charger and up to $50,000 for a fast charger installed at a tourism destination, such as a hotel, boardwalk or historic site.

Also seeking applications is the Multi Unit Dwelling (MUD) Charger Incentive Program, which encourages owners and operators of MUDs to provide EV chargers for residents and guests by offering up to $4,000 for a Level 2 charger and up to $6,000 for a Level 2 charging station in an overburdened community. The third program opened for new applicants, the Clean Fleet program, provides grants to local governments and nonprofit organizations. The program offers up to $4,000 for the purchase of a light-duty EV, up to $10,000 for trucks up to Class 6 and up to $5,000 for the installation of Level 2 chargers.

The BPU has budgeted $8 million for the tourism program, $15 million for the MUD program and $12 million for the Clean Fleet program in this fiscal year.

Gov. Phil Murphy (D) said the four programs together would help “establish EVs as an affordable and accessible option for all residents, regardless of their income or zip code.”

“In order to remain on track to meet our bold emissions-reduction goals, we must ensure that cost constraints and range anxiety no longer pose formidable obstacles for our hard-working families,” he said.

Stimulating ‘Incentive-essential’ Buys

The Charge Up program has awarded 6,933 subsidies totaling $19.6 million since July 1, 2022, with an average subsidy of $2,775, according to figures on the program website.

Tesla vehicles accounted for 4,600 of the subsidies, or about 62% of the funds awarded, the figures show. In 2020, the first year of the program, Teslas accounted for 83% of the incentives. In response, the BPU changed the rules so the largest subsidy would go to vehicles costing less than $45,000 in an effort to help “incentive-essential” buyers, those with lesser economic means who opt for a cheaper vehicle and might not buy an EV without the subsidy.

Purchases of Chevrolet Bolts accounted for 936 incentives, or about 19% of the subsidy funds awarded in the year from July 1, 2022, and Volkswagen buyers received 627 subsidies, or about 8.5%, the figures show.

Hyundai buyers received 332 subsidies (4.6%), and buyers of Nissans received 136 subsidies (2.4%), with most of funds going to purchase Leafs.

Helping Small Population Communities

The $13 million made available for local governments to buy EV trucks will be awarded in a competitive solicitation for projects that closes Sept. 4. The subsidy amounts are designed to offset the extra cost of buying an EV compared to a diesel vehicle, and to be eligible for an incentive, applicants must be replacing and decommissioning a fossil-fuel vehicle.

This year, the program for the first time will offer an incentive for Class 2 to 6 vehicles, such as garbage trucks, school buses and shuttle buses. The maximum incentive in that category is $10,000.

The program is part of the sixth round of awards of RGGI funds, and it prioritizes subsidizing local government vehicle purchases in overburdened communities, with additional incentives allocated to communities with a population of less than 20,000.

For example, the program would award a subsidy of $15,000 to a community that purchased a Class 2 non-passenger vehicle, the smallest size funded in the program. But the subsidy could be increased to $56,000 if the municipality is an overburdened community with a population of less than 20,000. At the top end, a Class 8 non-passenger vehicle could receive a basic subsidy of $305,000, with an additional $30,000 if it is an overburdened community and another $76,000 if the purchaser is a municipality with a sub-20,000 population.

To receive the funds, the new vehicle must be fitted for three years with a telematic device, which allows the collection of data on the use of the vehicle.