The oil industry’s arguments against EVs are misleading and based on old data from 2014. The EV market has changed dramatically in the last five years—batteries are improved, EV range has expanded, and battery prices continue to fall. In fact, over three times as many plug-in vehicles were sold in 2018 compared to 2014, and a bevy of new EVs entrants are coming to market. More manufacturers are coming out with new EV models in car and truck product lines. In 2014 there were 11 plug-in EV models that were cheaper than the average price of a vehicle in the United States; now there are 23.
Another false argument still circling out there by EV opponents—that the EV tax credit is too costly for the federal government to afford—is wrong too. Let’s put that into perspective by comparing the EV tax credit to tax credits for the oil industry.
First, the EV tax credit is temporary while oil tax credits are permanent. Second, there is only one tax credit for EVs while the oil industry has many.
Between 2019 and 2028, the U.S. Treasury’s loss for expensing exploration and production costs (intangible drilling costs) is $8.8 billion, percentage depletion’s loss is $6.4 billion, and short-term amortization of geological and geophysical expenses costs will exceed $2.4 billion in lost revenues. The enhanced oil recovery and marginal wells credits loses almost $9 billion more. In total, tax benefits for oil and gas production will cost the Treasury $27 billion over the next ten years—or $2.7 billion a year.
In 2018 alone, American taxpayers paid more than twice as much for just four of these permanent oil industry tax credits than they did for the EV tax credit.