Incentives are crucial to reach this target. The Recovery Act established tax credits for purchases of EVs and conversion kits. President Obama now calls for these tax credits to be transformed into rebates, which was backed up earlier this week by a bill (S:298) by Senator Debbie Stabenow.
I agree. As I said in a comment last year, tax credits only help people who are eligible for tax. The poor, who pay little or no tax, would be better off with rebates which can also be made available immediately, at the point of sale. So, I'm glad that the debate as to what are better incentives, tax credits or rebates, has now finally been settled in favor of rebates.
At the same time, what's also important is how such incentives are funded. A recent opinion piece in USAtoday describes subsidies as a form of "wealth transfer [that] is highly regressive, robbing from the poor to help a few greenies burnish their green credentials." In another piece, the same author says that support for EVs is "taking money from the poor and middle class to subsidize well-off environmentalists who want to drive a green vanity car".
Of course, this argument sounds rather disingenuous coming from an organization calling itself the American Enterprise Institute, the more so since the car used to illustrate the argument is made by an American company (Fisker Automotive, based in Irvine, California, with batteries from A123 Systems). Nonetheless, a government that doesn't raise specific revenues to finance such incentives risks accusations that the incentives will be funded from general government funds, i.e. money that would otherwise be used for social welfare, health, education, etc.
And that still sounds unfair toward the poor, as well as toward those who take efforts to reduce transport emissions in other ways, such as by walking or cycling to work, using public transport, avoiding travel to remote holiday destinations, homeschooling or working from home, etc.
The best policy is to combine rebates with fees on fossil fuel or on polluting vehicles. Feebates can use the revenues of such fees exclusively to fund local rebates on clean alternatives, thus helping those alternatives in two ways and making feebates most effective in helping EVs and reducing emissions accordingly.
There's no doubt that a rapid shift to EVs can benefit America in many ways, as I discussed before. The beauty of feebates is that they can be implemented without posing stress on the budget. Feebates can be budget-neutral, which should make them more acceptable to those concerned about deficits, i.e. budget deficits and trade deficits.