Car buyers have less than two weeks to take advantage of federal discounts that provide up to $7,500 toward the purchase of electric vehicles.
With the expiration of the federal tax credit at the end of this month, environmental policy experts said, there's one less incentive to buy the climate-friendly vehicles, and they're concerned about how Massachusetts will meet its goals for slashing planet-warming emissions.
“ It's going to be a lot harder to find a way to increase adoption to the levels that we need,” said Anna Vanderspek, electric vehicle program director at the nonprofit Green Energy Consumers Alliance.
Still, she said, consumers can still make the switch to EVs.
"This is not all going to grind to a halt," she said. "It is a challenging time, but that does not mean that this transition is not moving forward."
The federal discount was designed to encourage drivers to go electric. In ending the credit, Republicans in Congress and the Trump administration argued the government shouldn't place its thumb on automobile markets in favor of one type of vehicle over another.
In Massachusetts, staff at some local dealerships said they've seen an increase in interest and sales of EVs in recent weeks, as consumers try to take advantage of the credit before the looming Sept. 30 deadline. Some dealerships' websites feature online countdown clocks until the credit expires.
Nationally, EV sales are also up. Last month, more than 145,000 EVs were sold across the country and made up nearly 10% of all new vehicle sales, according to Kelley Blue Book estimates. This quarter, the U.S. could hit an all-time record for EV sales, the report stated.
Despite the “mad rush” to use the tax credit, EV sales will likely slow after it sunsets, said Christopher Knittel, professor of energy economics at the Massachusetts Institute of Technology and director of the university's Climate Policy Center.
In 2023, research out of MIT and Harvard University projected that federal tax credits, combined with efforts to install charging stations on highways nationwide, would increase EV adoption by 18% through the end of the decade. Knittel suspects customers could turn away from the EV without the financial incentive program.
“ Those are customers that are buying it because the tax credit exists, and if you pull it away, they're gonna go back to the internal combustion engine vehicle,” Knittel said.
Taking away the tax credits could reduce the number of EV sales through the end of the decade by around 6%, according to updated models from the Harvard and MIT team.
Massachusetts needs residents to register 900,000 EVs by the end of this decade in order to meet its climate change target. Last year, officials reported 140,000 EVs were on the state's roads. That pace of EV adoption has to increase for the state to meet its goal, Vanderspek said.
A Massachusetts-funded EV rebate program will still be available after the federal tax credit ends. The state incentive provides up to $3,500 for eligible vehicles. And Uber, Lyft and taxi drivers are eligible for a $6,500 credit. Some low-income households can also qualify for an additional $1,500.
Lauren Diggin, spokesperson for the state Department of Energy Resources, said staff works to ensure the rebate program "operates as cost-effectively as possible to support broad adoption of EVs, and to better support increased adoption among disadvantaged communities, which are disproportionately impacted by harmful transportation emissions."
The state will continue to help residents looking to purchase an EV "as the Trump administration dismantles federal programs that support affordable clean vehicles," she said.
The federal tax credit has income eligibility limits and requirements for vehicles to qualify. The IRS also clarified last month that as long as a buyers sign a sales contract and make a payment before Sept. 30, they can qualify for the credit even if their car is delivered after the deadline.
Consumers can also take advantage of lower monthly payments on leased EVs through the expiring tax credit. They count as commercial vehicles, so there's a wider range of qualifying cars and the person leasing doesn't need to meet the income requirements that buyers do. Dealerships claim a commercial tax credit and often pass savings onto consumers.
Whether buyers get the tax credit when they buy a car or when they file their taxes, Vanderspek said to make sure and get a “time of sale” report from the dealership within three days of purchase. That will allow buyers to prove their purchase happened before the deadline.
The other driver of EV sales, charging stations, seem to be back on track. The Trump administration resumed a federal charging infrastructure program in August after freezing its funding for months, but research suggests that won't make up for the loss of individual discounts.
Knittel sees potential for the state continue its work on charging infrastructure, which could encourage more EV adoption without the cost of tax incentives. The Northeast has some of the highest density of public EV charging ports in the country, with Massachusetts topping the list, according to data from the nonprofit Climate Central.
Last month, state officials announced $46 million to add more charging infrastructure.
"Access to EV charging is essential if we’re serious about reducing emissions and developing a transportation system that’s resilient, fair, and prepared for the challenges of climate change," said state Transportation Secretary Monica Tibbits-Nutt in the announcement.
Still, shifts in federal climate policy — like a proposal to end the legal underpinning for tailpipe emissions standards — and uncertainty about tariffs could spell further uncertainty for the EV industry, as well as for consumers, Knittel said.
" The most concerning thing to me is the yo-yo nature of climate policy at a federal level,” Knittel said. "We've really gone into a world where we just have uncertain policy and that's gonna have much longer term impacts than what we're talking about today."