Sorensen is the executive director of the Baltimore-Washington Electric Vehicle Initiative. She will be participating in a roundtable discussion Friday morning at the third annual Solar and Wind Expo at the Maryland State Fairgrounds.
But first, we wanted to set the scene and tease just some of the points Sorensen would be addressing this weekend.
Patch: Can you give me an overview of the electric vehicle industry in Maryland?
Sorensen: Maryland really is in a frontier position where electric vehicles are concerned. Reducing emissions, reducing our dependence on petroleum—those things go hand in hand in addition to a very fun ride. The price point is a little high still on the vehicle but we have some tax incentives at the state and federal level, but we think we’ll see just like most other emerging technologies that when production and demand go up the price will drop with it. The first computers were pretty expensive.
Maryland is one of the leading states in the country for electric vehicles to meet its renewable portfolio standard. We set aggressive standards in Maryland. The governor is behind EV initiatives; The Maryland Energy Administration, Maryland Department of Transportation the Maryland Department of the Environment—we’ve had facilitation by the Public Service Commission, strong awareness on the part of utilities—particular PEPCO and BGE. I would say in the last two years in particular we’ve really come quite a distance with a significant presence of EVs.
Patch: What is the big push? Why are electric cars the way to go in part to get us to that renewable energy portfolio standard?
Sorensen: I would attribute this to three things:
-Highly educated and concerned citizenry that understand the impact of emissions from vehicles and architecture. And that has an impact on our environment, on the Chesapeake Bay.
-Second, I would say congestion. Not just congestion on the grid but traffic congestion and awareness of mitigating that. Malcolm Woolf, the director of the Maryland Energy Administration, would cite that we—the Mid-Atlantic—are the most congested grid space and that’s an issue for us. The power does go out. We’ve got to think about how we consume and manage energy in whatever form.
-The third, I would say, is Maryland’s affinity for emerging technology. We’ve got a really strong research base, strong in emerging technologies and incubators, business incubation, our proximity to Washington D.C. and a depth capacity for legislating behaviors that need encouragement.
Patch: We’ve seen more people taking advantage of the solar panels on their home. But are EVs the next big push for meeting our statewide energy consumption goals?
Sorensen: I think it’s a very fair thing to say. I have an obvious bias, but, I think it’s a very fair because some of the statistics I cite from for example the Natural Resources Defense Council [indicate] that 35 percent of our emissions come from vehicles, 45 percent from built architecture. We could make a difference if we have smarter, particular, renewable-based energy systems that power us up for heating, lighting and cooling our buildings and moving us around. The coupling for me is very attractive. If we’ve got solar panels on a building that can also refuel your vehicle or be involved in re-fortifying the grid or strengthening it ... we’ve got a stronger energy system.
We’ve worked out business models through power-purchase agreements to install solar, but we need to do more. We know the Maryland legislature has been working on wind power. We’ve seen some of the push back on wind, but I think we’re making traction there. I think we’ll start to see geothermal emerge. But what we have with EVs is still a bit of an education challenge. For a lot of consumers, this represents a change in perception, that their behavior needs to change. And we need to get the message out as to what’s out there, what will it cost, why should I be persuaded, as a consumer on the residential side, somebody operating a fleet and on the government. We need to line up those things.
Patch: What are some of the types of tax credits available for electric vehicles?
Sorensen: There are two types of tax credits currently for electric vehicles in the state of Maryland—a state credit and a federal credit. The federal credit is for a volt—this is based on how large the battery is. A 3.3 kilowatt battery, you can max out at $7,500 tax credit, which maxes out when production reaches 200,000 cars. I’m not exactly sure how far they’ve gotten. ... There’s been talk of trying to increase that tax credit. It’s an income tax credit, not a point-of-sale tax credit. So part of the issue there is you can’t really monetize that benefit when [you buy the vehicle]. The price point will be the price point but later when you file your income tax returns you can claim the credit.
I would love to see us work out business models that put us on level playing field with what the solar industry has done. When you go to buy solar panels and you can either pay $28,000 for 4 kilowatts or $13,000 because you leased your roof to the provider who then bought the panel and can take immediately the tax credit. In other words, a lease model is beneficial for purposes of claiming the tax credit, which reduces the price point, but you’re just leasing and not owning outright.
I, for example, leased my Chevy Volt because I think the technology will dramatically improve. ... I expect we’ll see strong improvements in battery performance and range, cost of production and some of the material science. I think we’ll see that shortly. We, just four to six months ago, saw that IBM announced that they had perfected lithium air-batteries and with it range performance from an average 100 miles a charge to 500 miles a charge.
When we make investments and we say this market is hot and it’s here—and I believe it is—we’ll see others make investments that cut to the quick of what problems are they experiencing.
Maryland also has a point-of-sale excise tax credit. So for lease or purchase, if there are sales taxes accessed the consumer is entitled to a $2,000 credit made available by the state of Maryland. ... There are also non-tax credits, like you can apply for HOV lane access if you have an [electric or hybrid] SUV, which is advantageous for a lot of folks.