A new Texas bill that would impose a $400 registration fee for a new electric vehicle and a $200 annual renewal fee has cleared the state legislature with zero opposition vote.
If Abbott signs it, the bill would go into effect on Sept. 1, 2023.
The bill’s author, Republican state Sen. Robert Nichols, said this measure is meant to make sure EV drivers pay their fair share in maintaining the state’s infrastructure.
“Many Texans are choosing alternatively fueled vehicles like electric vehicles to go about their daily commute. As more of these vehicles drive on Texas roads, there are concerns about how they contribute to the funding of the roads which they use,” Nichols explained in a statement when he initially filed the bill in February.
“Currently, Texas uses the gasoline or diesel fuel tax to fund transportation projects; however, with the growing use of EVs, the revenue from the fuel tax is decreasing, which diminishes our ability to fund road improvements for all drivers,” he continued. “EVs use the same roads as petroleum-powered vehicles, thus they should be subject to an equalization of road use consumption amount.”
According to an analysis provided by the Texas Comptroller’s Office and the Texas Department of Motor Vehicles, it is assumed the additional fees would apply to approximately 105,800 currently registered vehicles. The agencies estimated that the bill would generate an extra revenue of $342 million for the State Highway Fund in five years beginning in 2024.
“We recognized some time ago that each time an all-electric vehicle does get on the road and displaces a gasoline or diesel vehicle that the state highway fund loses money,” Nichols said during a March 22 Senate transportation committee hearing. “So the object here is to try to identify how much money do we lose on both state and federal and try to make that up with a fee adjustment.”
While all state lawmakers agreed that it’s fair for EV drivers to make up for gasoline taxes they aren’t paying, consumer advocates have argued that the proposed fee is so high that it becomes punitive.
“Consumers should not be punished for choosing a cleaner, greener car that saves them money on fuel and maintenance,” said Dylan Jaff, a policy analyst at nonprofit policy research group Consumer Reports. “The fees proposed in this bill will establish an inequitable fee scale for EV owners, and will not provide a viable solution to the long-standing issue of road funding revenue.”
The bill has also drew criticism from environmental activists who see EVs as a more environmental- and climate-friendly alternative to traditional gas-powered cars. Luke Metzger, executive director of Environment Texas, said the new fee would make it harder for people to afford “clean vehicles” that could help reduce air pollution in the Lone Star State.
“If there’s a $200 fee, the driver of a Nissan LEAF, which is efficient, might be paying as much as a driver of a gas-powered Hummer, which is ridiculous,” Metzger said, reported The Dallas Morning News.
“Really, the driver of a Nissan LEAF is providing great benefits to the state of Texas in terms of cleaner air, and has much less impact on the road than a Hummer,” he said. “But they'd be paying the same fee.”
