B.C.’s EV rebate saw businesses squeeze out public: analysis

Doctors, developers, numbered companies and car dealerships scooped up more than $1.6 million in taxpayer-funded electric-vehicle rebates during the height of the provincial program last year, before funding ran out and the rebate was reduced.

Although the B.C. NDP government has billed the electric vehicle rebate program as a measure to encourage ordinary British Columbians to switch from gas-powered vehicles in the name of fighting climate change, the program also allows corporations and local governments to access the public funds.

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The result, according to a Postmedia News analysis of the rebate data from a peak three-month period in 2019, shows a variety of questionable uses, including to 24 numbered companies whose businesses are largely unknown (the government admits it does not check), a website registered to an address in Tennessee and five car dealerships that appear to have purchased the cars from themselves.

In addition, the rebates also helped subsidize corporations that represent high-income professions, such as nine physician offices, 18 real estate or development firms, six holding companies, two capital management companies and two law corporations.

By accessing the money, the businesses squeezed out members of the public from obtaining rebates before the fund was exhausted and the rebate reduced in June 2019. Almost 6% of total subsidies went to those groups, out of the $30 million spent at the time.

Oversight by government appears to have been limited.

A business called “LetMeDrawYourPet.com” obtained a $2,500 rebate toward a 2019 Mini Cooper Countryman. That web domain is registered to an address in Tennessee. But the B.C. rebate went to a condo in Richmond registered to owner Man Kit Chung. Requests for comment to both went unanswered. Government admitted it does not check if businesses are legitimate, only if they are properly registered in B.C.

Even Tesla, which has a market value of $100 billion, got in on the taxpayer-funded action. Tesla Motors Canada received a $5,000 rebate toward a 2019 Model 3 that the company’s Vancouver office “purchased” from itself. Tesla did not return a request for comment.

Discovery Honda in Duncan applied for $10,000 in rebates for two 2019 Honda Clarity plug-in cars. It also did not comment. Other car dealerships were located in Abbotsford, Richmond, Penticton and Vancouver.

“They are technically allowed,” said Energy Minister Bruce Ralston, suggesting when dealerships buy their own cars for shuttles and other purposes it provides good advertising exposure to introduce others to the concept of electric vehicles.

But could publicly funded rebates be better spent on people and not subsidizing auto dealerships?

“You are the first person to ask me that question,” said Ralston, who took over the ministry in January and was not responsible for setting the rules on the existing rebate program. “The program is always open for review.”

It does not appear any review was conducted before last month’s provincial budget committed another $20 million to top up the electric vehicle rebate program.

Ralston said odd results are worth investigating.

But for now, Ralston said the new round of $20 million in rebates will start under the existing rules on April 1.

B.C.’s electric vehicle rebate program peaked in May 2019, as the $5,000 rebate on vehicles priced up to $77,000 dovetailed with a simultaneous $5,000 federal rebate and a $6,000 B.C. SCRAP-IT rebate if the buyer retired a gas or diesel vehicle at the same time.

The $16,000 in subsidies sparked a buying frenzy. Within two weeks, the B.C. program was out of its first round of money. In June, government topped up the fund but said demand was so high it would be empty again within two months without changes. It shrunk the rebate to $3,000 and lowered the price of eligible vehicles to $55,000.

Postmedia obtained the April-June 2019 data using a freedom of information (FOI) request after the Ministry of Energy refused to provide the names of the companies that received the money. The FOI was filed in June 2019, and it took the government eight months to release the data.

The rebate program is not designed to weed out worthy recipients based on income, financial hardship or ability to pay.

“It’s not means tested,” said Ralston. “The idea is to convert the fleet from gasoline to electric. And it’s been tremendously successful and very popular.”

The government’s goal was to have electric vehicles represent 10% of new vehicle sales by 2025. Currently, B.C. is at 9%, meaning the province is almost five years ahead on its target.

Still, the program contains funding oddities.

Numbered companies are able to obtain the rebate with virtually no checks by the province, other than being licensed in B.C. “Government has not verified numbered companies to date,” the Ministry of Energy said in a statement.

“A lot of businesses have been encouraged to put these things in their fleets by government,” said Blair Qualey, CEO of the New Car Dealers Association of B.C., which administers the rebate program on behalf of government. “So from time to time, you may have a dealer that wants to use one of these as a shuttle.

“Dealerships are a business like other businesses that have access to the incentives, so I don’t want to penalize them just because they happen to be a dealership. But it’s the government’s program; they set the parameters.”

Some businesses say the rebate is key to helping them transition their fleet.

Modo, the car-sharing co-operative, received $5,000 on a 2020 Kia Soul electric vehicle. The rebate was helpful because the car-share is a non-profit organization and its members want more environmentally friendly vehicles, said Anthony Okuchi, Modo’s director of fleet operations.

Modo has maxed out the 10 electric vehicle rebates it is eligible for under the program, and wants a government exemption for car-share companies to get more.

“Right now, what we’re seeing at Modo is we’re at this tipping point socially. Consumers are aware of them, ready to use them, the cars are ready to use for multiple trips a day. We wanted to go full EV but the challenge is they are much too expensive,” he said.

The 2019 data of peak months appears to represent the general trend of B.C. electric vehicle rebates on a larger scale. The Ministry of Energy said there have been a total of 6,884 total electric vehicle rebates issued to date, of which 6% went to businesses and 1% to numbered companies.

 

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