How does California’s $3,500 EV rebate work?

Thinking about buying or leasing an electric car in the near future? California will soon be making that cheaper.

On Monday, Gov. Gavin Newsom signed legislation that sets aside millions of dollars in state funds to fund rebates for residents who buy or lease a zero-emission vehicle — a category that includes battery-electric cars and hydrogen fuel cell-powered vehicles.

First-time EV buyers can qualify for a $3,500 discount when buying or leasing a new electric vehicle, as long as the retail price is under $50,000. If you’re looking for a used electric car, there’s still a price reduction available — a smaller one, however: $1,750 off for vehicles retailing for under $25,000.

The state’s program — called “MyFirstEV” — comes a year after President Donald Trump’s massive spending and tax plan known as the One Big Beautiful Bill ended federal tax credits for EVs nationwide. Previously, American consumers could claim a $7,500 tax credit after buying a new EV or $4,000 for used EVs.

Newsom said on Monday that as the federal government pulls back from supporting EVs, California would instead be “putting its foot on the accelerator” — and that the instant rebate program would “[make] it easier for families to drive clean, breathe clean, and keep more money in their pockets.”

The program has secured $270 million in funding — half of that from the state budget and the other from participating EV automakers.

One big thing to know: Despite the fanfare, the MyFirstEV program has not yet started — and we don’t have an official start date either. State officials will reveal next month which car brands are actually included, so don’t expect to receive this discount if you purchase an EV today.

Who qualifies for this program?

Only California residents who are buying or leasing an EV for the first time are eligible for this rebate.

And consumers will have to confirm that this is the first time they are buying or leasing an EV before taking their car home, said Lindsay Buckley, communications director of the California Air Resources Board, the agency tasked with managing the program.

“Participants will be required to sign a legal document declaring that this is in fact their first purchase or lease of an electric vehicle,” she said.

“So if you’ve already bought or leased an electric vehicle in the past, then you wouldn’t be eligible for this program.”

Limiting the program to first-time buyers could actually help boost the popularity of EVs among people who have never bought them, said Scott Moura, a UC Berkeley professor of civil engineering.

“Providing incentive to people who have bought EVs before isn’t really adding to the number of people who purchase EVs,” he said. “The funds can be used most effectively if they’re targeted towards first-time EV buyers.”

Do I need to apply ahead of time?

No — there’s no application to fill out ahead of time. Once state officials announce that the MyFirstEV program has officially begun, all you need to do is go to a dealership of a participating automaker.

This is different from other past state rebate programs — like the now-terminated Electric Bicycle Incentive Program — which have required participants to fill out an application before making a purchase.

If you move forward with making a purchase or lease, confirm two things with the salesperson and the financing team:

• That you qualify for the MyFirstEV discount
• That there are still state funds available for this specific car brand.

When federal EV rebates were available, buyers had to initially wait until they filed their taxes the year after buying their car to request this money back. But state officials say that folks interested in the FirstEV discount won’t have to wait so long.

“Once launched, Californians will be able to go down to participating automakers’ dealerships and access the rebates at the point of sale,” Buckley said. “They won’t have any delay in getting this discount.”

Can the program help me pay for any EV I want?

No — MyFirstEV discounts will only cover battery-electric cars and hydrogen fuel cell-powered vehicles from automakers participating in the program. State officials will confirm next month which car companies are included.

But this means that if an EV brand you really want to purchase is not on the list, you won’t get the discount when buying or leasing the car.

Hybrid vehicles are also not included in MyFirstEV, state officials confirmed with KQED.

There’s also a price limit: The EV you choose must cost under $50,000 if it’s a new car, and $25,000 if it’s used. There is, however, a small exception to this price rule if the automaker is headquartered in California — in which case the discounts will apply regardless of the manufacturer’s retail price. More than a dozen electric car brands are based in the Golden State, with several selling models priced beyond the $50,000 limit.

I’m really interested in this program. What should I do while I wait for it to open?

While consumers wait for the program to begin, Buckley said they learn as much as they can about different EVs available on the market.

“Maybe head to a dealership and take a test drive of an electric vehicle that you’re eyeing,” she said. “We do expect this to be a popular program and for [funds] to get gobbled up pretty quickly” — so the more prepared you are when the program officially begins, the better.

A Polestar electric car prepares to park at an EV charging station on July 28, 2023, in Corte Madera. (Justin Sullivan/Getty Images)
Potential buyers can also learn about what it takes to care for an EV, like how to find charging stations and battery maintenance.

Buckley said the site ElectricForAll — created by the nonprofit Veloz — is a good source of information.

Will some carmakers have more rebates available than others?

No — funds will be divided equally among the participating automakers.

However, there may be greater demand for some brands, which could mean that rebates may run out faster at some dealerships.

This article includes reporting from KQED’s Laura Klivans.