Although the elimination of national electric vehicle rebates has impacted potential purchasers significantly, California aims to bridge this shortfall for its citizens. In the 2026-2027 budget proposal unveiled by Governor Gavin Newsom on Friday, a program called the 'light-duty zero-emission vehicle (ZEV) incentive program' features a single allocation of $200 million.
The budget overview describes this initiative as 'a vital component of the Administration's approach to ensuring ZEVs remain affordable and reachable for everyone.' The plan must still gain approval from the state legislature in the coming months, yet if enacted, it would sustain the progress in electric vehicle uptake throughout California. Data from the California Energy Commission indicates that electric vehicles accounted for nearly 30 percent of vehicle sales in the third quarter of 2025.
The budget document lacks specifics on how the $200 million would be distributed per vehicle, though USA Today noted that the incentive would function as an immediate point-of-sale reduction for electric vehicles. Under prior federal programs, consumers could receive as much as $7,500 in rebates for new electric vehicle acquisitions and $4,000 for pre-owned ones. Liane Randolph, chair of the California Air Resources Board, informed USA Today that officials are evaluating whether to extend similar rebates to buyers of used electric vehicles.