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California providing incentives up to $12K to help low-income families afford the cleanest cars

In coordination with local air officials, the California Air Resources Board is initiating a retire-and-replace pilot program in the Greater Los Angeles area and San Joaquin Valley to help people of low income replace old, polluting cars with cleaner, more fuel efficient vehicles that also cut greenhouse gas emissions.

The air district-administered program provides incentives on a sliding scale, with larger cash payments for the lowest-income families moving up to the cleanest cars. The lowest-income recipient purchasing the very cleanest car receives the highest incentive amounts. Under the program, it is possible for a family that meets income guidelines to receive as much as $12,000 toward the purchase of an electric car.

Consumers can choose to replace their vehicle with a more fuel efficient conventional gasoline-powered car, a conventional hybrid, a plug-in hybrid or an electric car. Eligible consumers will receive between $2,500 and $12,000, depending on their income and the type of replacement vehicle they choose.

The pilot program is available for three income levels:

  • Low Income (≤ 225% of the federal poverty level, FPL). Buyers in this income level who replace a scrapped car with a conventional hybrid car (e.g.Toyota Prius) that is less than 8 years old that gets 20 mpg or greater, are eligible for $6,500 in incentives. If the replacement car gets 35 mpg or greater (Toyota Prius or Honda Insight), that goes up to $7,000. A plug-in hybrid (e.g. Chevy Volt), or an electric car (e.g. Nissan Leaf) receives $9,500.

    In addition, up to $2,000 for a charging unit at a single residence or multi-unit dwelling is available for the purchase of battery electric cars. In the case of either a brand new plug-in hybrid or electric car, buyers receive an additional $1,500 and $2,500, respectively, from a separate program, known as the Clean Vehicle Rebate Project.

  • Moderate Income (226% - 300% of FPL). Buyers who replace a scrapped car with a conventional hybrid model that gets 35 mpg or greater receive $5,000, rising to $7,500 for a plug-in hybrid or electric car. (In addition, buyers can receive up to $2,000 for a charging unit for battery electric cars, and if those are brand new cars, an additional $1,500 or $2,500, respectively.)

  • Above Moderate Income (301% - 400% of federal poverty level). Buyers who replace a scrapped car with a plug-in hybrid or electric car receive $5,500—which includes an additional incentive of up to $2,000 for the charging unit for battery electric cars, and an additional $1,500 or $2,500, respectively, if they are brand new.


Lower-income consumers who would like to replace their dirty cars with more fuel efficient conventional cars would still qualify to receive up to $4,500.

Additional funding is available for low-income recipients who live in a ZIP code that contains a disadvantaged census tract for the purchase of a conventional hybrid, plug-in hybrid or electric replacement vehicle. (SB 535, introduced by State Senator Kevin de Leon, directs funds to provide economic and health benefits to the state’s disadvantaged communities—those that are most impacted by both poverty and pollution.)

Finally, residents who scrap an old, dirty car but choose not to replace it are eligible for public transit passes valued at between $2,500 and $4,500, depending on their income.

ARB worked for more than a year with the South Coast Air Quality Management District and the San Joaquin Valley Air Pollution Control District in support of the development of the pilot projects. Each air district developed a program tailored to the individual needs of that district. The program (also known as the Enhanced Fleet Modernization Program and Plus-Up Pilot Project) is partially funded by proceeds from cap-and-trade revenue under the California Climate Investments Initiative and AB 118.

Besides SB 535, another bill helping to drive the program is SB 1275, the Charge Ahead California Initiative, also introduced by Senator de Leon, which aims to ensure that low-income Californians, who are disproportionately impacted by air pollution, benefit from California’s transition to a clean transportation sector.



It looks like a reasonable attempt to solve pollution problems while accepting that the worst vehicles are often owned by the poorest people.

This means that you have to give them money and allow them to buy secondhand cars (which they seem to be doing).

Possibly, they need an app which can take a car spec (age, mpg, cost) from a dealer forecourt and tells you immediately what you will get, or publish lists of cars that would be discounted.

You can get secondhand Nissan leaf's quite cheaply, so I assume this would be the same in the USA.

Again, you have to be clear what you are trying to reduce - CO2 or "local pollutants", and set your bands appropriately.
IMO, there is no point in paying poor people to reduce their CO2, but there IS a point in getting the most "local" polluting cars off the road, so just worry about the pollution level, not the mpg.


California is leading one more time in the fight to reduce GHG and pollution.

Linking subsidies to income is smart. The progressive cut off could be sharper?

Nick Lyons

FPL for family of 4 is $24,250. 400% of $24,250 = $97,000. So if this family has (or acquires) a beater worth, say, $500, they can junk it, buy a Nissan Leaf and get an additional $8,000 rebate. I predict that something like this scenario will soak up most of the funds allocated for this program, since more middle income types are going to tune in to this benefit.

Lower-income consumers who would like to replace their dirty cars with more fuel efficient conventional cars would still qualify to receive up to $4,500.

The above is the big potential benefit, IMHO--get the super polluters off the road. Whoever administers this program needs to get the word out.

Bob Wallace

There are apparently around 300 used Leafs for sale in the LA area. I've seen a number with <30k miles for $13k or less.

If I'm reading that right a low income individual/family could purchase a $13k Leaf for $3,500. Fuel savings would pay that puppy off in short years. Perhaps not much more than two.

This programs is structured the right way. More assistance for those who need it the most. The federal subsidy is unusable for lower income people. It's a tax credit.


Is it really a good thing to invest a lot of public subsidy on something that will have a indiscernible impact in the great scheme of things.

Is taking an older car off that could have a good few more years of service remaining a sustainable practice if the emergy and materials needed is going to more than offset any savings in lower fuel consumption.

Sorry for being cynical but is this to benefit air quality or the auto industry?

For my part I have a 16 year old car 1.8T Passat with 215,000 miles which suits my driving routines in a way that an EV cannot meet. In europe where fuel prices are acopalyptically high (in a US consumer's view), it's effecient enough for me to keep it going even though it runs on petrol (gasoline). I can get 45mpg on a good run to work even though it is rated to be 34mpg on the EU Combined Cycle, as I have looked after it and know how to drive effciently without driving like funeral director.


They'll get 'em nearly free, sell them, and make a profit. Maybe I can get one when they dump them, which they will, for the chance to get an old pick-up.

Bob Wallace

It's easy to prevent a 'buy and sell' scheme. Require the subsidy to be refunded before the title is released if the car is sold too soon.

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