Why Beijing roads might soon be full of electric cars: Free license plates

March 8, 2013
March 8, 2013

China has a new plan to reduce the chemical haze enveloping its capital city. Officials are working on a plan to give electric car owners in Beijing a 120,000 yuan ($1,9298) purchase subsidy and allow them to get a license plate without going through the city’s onerous monthly lottery, according to state media this week.

Converting more of Beijing’s 20 million residents into electric car users is one of Beijing’s better solutions for cutting down on pollution. And it may be one of the best incentives any government has made to get its citizens to go for electric vehicles. The US offers a $7,500 subsidy, but the US Congressional Budget concluded last year the tax credits, in most cases, don’t offset how much electric cars cost over a lifetime.

Maybe the US would have more luck convincing car drivers to go electric if they allocated license plates to a brutal long-shot lottery. In Beijing, just one in 71 applicants got a license through the system in December last year; the total number of  applicants hit a record of 1.43 million in January.

A similar program could work in other Chinese cities that also use the lottery system, like Shanghai and Guangzhou, where intense competition for the registrations have given rise to schemes to get around the lottery. In Shanghai, where the license registrations are done via an auction, registrations have sold for 70,000 yuan, the same price as some cars sold in China.

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