Are Michigan's registration fees on electric vehicles causing it to fall behind other states?
Twenty other states have more electric vehicles registered than Michigan. Michigan also has some of the highest annual fees on EVs.
You might expect states with larger populations such as California and Texas to have more electric vehicles, but there are states the same size as Michigan or smaller that have two to three times as many EVs.
For example, while Michigan has 10,620 electric vehicles on the road, Georgia, which is similar in population, has 23,530 EVs.
New Jersey has a smaller population than Michigan and has 30,420 electric vehicles.
Oregon has less than half the population of Michigan and more than twice as many EVs.
The co-author of a report on Michigan’s annual fees on electric vehicles said some of those states with a lot more EVs have something that Michigan does not.
“Ones that have incentives for the purchase of those electric vehicles. But on the flip side, Michigan has one of the highest disincentives in the form of its EV registration fees,” said Charles Griffith director of the Ecology Center’s Climate and Energy Program.
The State of Michigan collects taxes for roads through a fuel tax, and sales tax on that fuel as well as registration fees. Since electric vehicles don’t burn as much gas or none at all, the state charges additional registration fees for electric vehicles.
“We all know that EVs are a little pricier than the traditional gasoline car, but that also means that they're paying higher registration fees than comparable gasoline vehicles,” said Griffith.
Griffith said those fees end up costing the owners of electric vehicles more than what someone driving a similar-sized car burning gasoline would pay over the year. So, someone driving a Chevy Bolt would end up paying more in fees than someone driving a Chevy Equinox.
Governor Gretchen Whitmer proposed electric vehicle incentives in her State of the State address. In a follow-up press release, her office said, “The $2,000 rebate for a new electric vehicle and $500 rebate for at-home charging infrastructure can be paired with the $7,500 federal tax credit, knocking nearly $10,000 off the price of a new electric car, including those being built in Michigan.”
Griffith said he didn’t think Michigan’s higher fees were the only reason the state has fewer electric vehicles on its roads. He noted that Michigan has been installing more charging stations, but the state is lagging behind several other states.
It is a bit of the chicken or the egg. Do you wait until there are more EVs on the road in Michigan and increase the number of charging stations accordingly? Or, do you install more charging stations to make buying an electric vehicle more attractive?