Fleets funding overview

As the electric vehicle market expands, stakeholders such as EV fleet operators, commercial and residential charger owners and multifamily building owners are exploring effective ways to finance the transition to electric mobility. Grants and incentives play a critical role in facilitating the purchase of EVs, EV charging equipment and covering installation and related project costs. This article delves into the significance of these financial aids, highlighting how commercial incentives often surpass those available to individual consumers.

The role of grants and incentives in EV adoption

1. Mitigating high initial costs

The substantial upfront costs of EVs and charging infrastructure are often a significant barrier to adoption. Grants and incentives can alleviate these financial burdens. For instance, the federal government provides tax credits of up to $7,500 for the purchase of qualifying new EVs, which significantly reduces the initial investment required for consumers. Similar grants for commercial vehicles are larger, with the same federal credit covering up to $40,000 for a qualified commercial clean vehicle.

2. Promoting infrastructure development

Installing EV charging stations, particularly in multifamily and commercial settings, can be prohibitively expensive. Incentives like the Alternative Fuel Infrastructure Tax Credit, which offers a 30 percent tax credit on installation costs up to $30,000 for commercial properties, make it financially feasible to develop the necessary infrastructure.

3. Supporting comprehensive projects

Grants and incentives often cover a broad spectrum of costs, including the purchase of vehicles and chargers, installation expenses and other related project costs. This comprehensive financial support enables stakeholders to implement a full-scale EV strategy efficiently.

Types of grants and incentives available

1. Federal incentives

The U.S. federal government offers a range of incentives to promote EV adoption. The Federal EV Tax Credit provides up to $7,500 for qualifying new electric vehicles, benefiting both consumers and businesses. Additionally, the Alternative Fuel Infrastructure Tax Credit supports the installation of charging stations by offering a 30 percent credit on installation costs, with a cap of $30,000 for commercial properties.

2. State and local incentives

Numerous states and local governments offer additional incentives, which can complement federal programs. For example, California’s Clean Vehicle Rebate Project (CVRP) offers rebates up to $4,500 for new EV purchases or leases. Additionally, the Sacramento Metropolitan Air Quality Management District offers incentives to aid in the procurement of low-emission commercial trucks, buses, tractors as well as supporting infrastructure.

3. SMUD programs

SMUD provides rebates and incentives to support the installation of EV charging stations. These programs can include grants for purchasing charging equipment and subsidies for installation costs, like rebates for installing EV chargers at workplaces and multifamily buildings. You can read more about this in the article “SMUD Incentives for EVs" in the incentives section.

Incentives for commercial EVs and charging equipment

Commercial incentives for EVs and charging infrastructure are often more substantial and generous compared to those available to individual consumers. This is due to several factors:

1. Larger scale projects

Commercial projects typically involve higher volumes of vehicles and more extensive infrastructure, necessitating larger investments. As a result, the financial aid provided is correspondingly greater to ensure these larger-scale projects are viable.

2. Economic and environmental impact

Commercial EVs and charging stations can have a more significant impact on reducing greenhouse gas emissions and promoting sustainable practices. Governments and utility companies, like SMUD, therefore, offer more generous incentives to accelerate the adoption of commercial EV fleets and charging infrastructure.

3. Specific programs for commercial entities

There are numerous programs specifically designed for commercial entities. For example, the U.S. Environmental Protection Agency (EPA) offers grants through the Diesel Emissions Reduction Act (DERA) to help replace old diesel vehicles with cleaner alternatives, including electric trucks and buses. These grants can cover a significant portion of the costs, making it more affordable for businesses to upgrade their fleets.

Steps to maximize benefits from grants and incentives

1. Research available programs

Stakeholders should start by researching available grants and incentives at federal, state and local levels. Websites like the U.S. Department of Energy’s Alternative Fuels Data Center provide comprehensive information on available incentives.

2. Combine incentives

Maximizing savings often involves combining different grants and incentives. Stakeholders can use federal tax credits alongside state rebates and SMUD programs for greater financial benefits.

3. Prepare detailed documentation

Applying for grants and incentives typically requires detailed documentation, including proof of purchase, installation invoices and compliance with specific requirements. Ensuring all paperwork is in order can streamline the application process.

4. Consult with experts

Engaging with experts or companies specializing in EV infrastructure can help stakeholders navigate the complexities of grants and incentives. These professionals can provide valuable insights and assist with application processes.

5. Plan for long-term benefits

Beyond the immediate cost reductions, stakeholders should consider the long-term benefits of EV adoption, such as lower operating costs, reduced maintenance and potential revenue from providing charging services.

For EV fleet operators, commercial and residential charger owners and multifamily building owners, grants and incentives are essential tools for reducing the financial barriers to EV adoption. By leveraging these programs, stakeholders can not only support their transition to electric mobility but also contribute to broader environmental and economic goals. The key is to stay informed, plan strategically and utilize available resources to maximize benefits.

Try using our Business EV Tool to learn more

Go to Business EV Tool

SMUD incentives

As the shift towards electric vehicles accelerates, businesses and property owners in Sacramento have a unique opportunity to join the movement with the help of SMUD. Whether you manage a fleet, own a commercial property or oversee a multifamily building, SMUD’s commercial EV incentives can make your transition to electric vehicles easier and more affordable. Explore the range of incentives and see how you can benefit from SMUD’s programs designed to support EV adoption and infrastructure development.

Why choose SMUD’s commercial EV incentives?

SMUD’s commercial EV programs are crafted to help businesses reduce greenhouse gas emissions, comply with California’s Low Carbon Fuel Standard (LCFS) and promote the benefits of plug-in electric vehicles (PEVs). These incentives are not funded by SMUD ratepayer money but through LCFS revenue, ensuring that your participation directly supports broader environmental goals without affecting your utility costs.

Incentive programs and benefits

1. Level 1 or 2 smart outlet

Incentive: $1,500/unit

2. Level 1 EVSE

Incentive: $500/handle

3. Level 2 EVSE

Incentive: $4,500/handle

4. Non-public low power DCFC (<50 kW)

Incentive: $7,500/handle

5. Non-public mid power DCFC (50-149.9 kW)

Incentive: $15,000/handle

6. Non-public high power DCFC (>150 kW)

Incentive: $30,000/handle

7. Stub outs

Incentive: $250/stub out

8. DCFC with onboard storage

Incentive: $100/kWh integrated battery capacity

9. Panel upgrade

Incentive: $1,000/panel

10. Transformer upgrade

Incentive: $5,000/transformer

Please see full details and eligibility requirements here.

Additional resources and programs

1. SMUD Contractor Network

Gain access to a network of contractors experienced installing EV charging stations, ensuring your project is handled by knowledgeable professionals.

2. Multifamily properties

Properties with five or more units can qualify for incentives to install EV charging stations, making it easier for tenants to charge their electric vehicles.

3. Commercial EV pilot rate

Explore a subscription-based electric vehicle rate option for your business, potentially lowering your electricity costs and simplifying billing.

How to participate

To participate in SMUD’s Commercial EV program requires submission of an incentive application through our online portal. These applications must be submitted to and approved by SMUD before construction begins. Detailed requirements and procedures are outlined in the Commercial EV program manual, available through SMUD.

For those unsure which program fits their needs best, submitting the EV interest form or emailing CommercialEV@smud.org can provide personalized guidance.

Explore your eligibility with our Business EV Tool

Stakeholders can utilize SMUD's Business EV Tool to model their eligibility and understand the potential benefits specific to their situation. This interactive tool simplifies the process of determining which incentives apply to your business, helping you make informed decisions about transitioning to electric vehicles.

SMUD’s commercial EV incentives are a powerful tool for businesses, property owners and multifamily building managers in Sacramento aiming to embrace electric mobility. By reducing the costs of EVs and charging infrastructure, these programs not only support your sustainability goals but also contribute to a cleaner, greener future. Use our Business EV Tool to start your journey towards electrification today.

By leveraging these incentives, you can be at the forefront of the electric vehicle revolution, driving both environmental and economic benefits for your business and community.

Visit SMUD’s Commercial EV Programs page and try SMUD's Business EV Tool to learn more.

Check out SMUD's electric vehicle charging programs for more ways to save

Learn about our programs

What are LCFS credits?

As the global community intensifies its efforts to combat climate change, the transportation sector has emerged as a significant contributor to greenhouse gas emissions. In response to this, various regions are implementing measures to incentivize cleaner alternatives, and one such initiative is the Low Carbon Fuel Standard (LCFS). LCFS credits play a crucial role in encouraging the adoption of low carbon transportation solutions, with California being a pioneer in their implementation.

What are LCFS credits?

LCFS credits are a market-based mechanism designed to promote the use of low carbon fuels and electrification in the transportation sector. Originating in California in 2009, the LCFS program has since become a model for other jurisdictions seeking to reduce carbon emissions from the transportation industry.

How do LCFS credits work?

The core principle of LCFS credits is to assign a value to every ton of carbon dioxide equivalent (CO2e) reduced or avoided through low carbon fuels or technologies. The credit system operates in a credit market where regulated entities, such as fuel producers and importers, must accumulate a specific number of credits to meet their compliance obligations.

Pricing of LCFS credits

The pricing of LCFS credits is determined by market forces and can vary based on the supply and demand for credits. Regulated entities can buy and sell these credits in the open market, creating a dynamic pricing structure. This market-driven approach incentivizes innovation and efficiency in the adoption of cleaner transportation technologies.

Redemption of LCFS credits

Once a regulated entity accumulates LCFS credits, they can use them to offset their carbon emissions or sell them to others who may be falling short of compliance. This flexibility allows for a diverse range of strategies in meeting LCFS requirements, fostering competition and encouraging the most cost-effective emission reduction measures.

California's unique approach

California's LCFS program is noteworthy for its comprehensive and ambitious goals in reducing carbon emissions. The state sets annual carbon intensity targets, creating a trajectory for the continual reduction of emissions from transportation fuels. This approach ensures a sustained and long-term commitment to cleaner transportation.

SMUD Business EV Tool

Our Business EV Tool is a pioneering platform that models the estimated LCFS credit value for a given vehicle electrification scenario. By incorporating these credits into the total cost of ownership analysis, businesses can make informed decisions about transitioning to electric vehicles.

Benefits of LCFS credits

1. Economic incentives

The market-driven nature of LCFS credits provides economic incentives for businesses to invest in low carbon technologies, ultimately reducing the overall carbon footprint of the transportation sector.

2. Innovation and competition

The flexibility in credit trading fosters innovation and healthy competition among industry players to adopt the most effective and efficient low carbon solutions.

3. Total cost of ownership analysis

Tools like the SMUD Business EV Tool allow businesses to holistically evaluate the financial implications of transitioning to electric vehicles, considering the benefits of LCFS credits in the overall cost of ownership.

LCFS credits are a vital component in the global efforts to combat climate change by encouraging the adoption of low carbon transportation solutions. California's pioneering approach, coupled with innovative tools like the SMUD Business EV Tool, highlights the ongoing commitment to reducing carbon emissions in the transportation sector. As the world continues to prioritize sustainability, LCFS credits serve as a beacon for a cleaner and greener future in transportation.