Incentives help drive the purchase of plug-in electric cars, which remain unfamiliar and expensive to many first-time buyers.

But a recent article on The Street may have caused some confusion over which incentives will be granted to BMW's first electric car, the i3, when it goes on sale this spring.

MORE: 2014 BMW i3 Electric Car: Why California Set Range Requirements, Engine Limits

Based on several conversations with sources close to BMW and at various regulatory agencies, we think we've sorted out the incentives for which the BMW i3 qualifies--both with and without its optional range extender.

2014 BMW i3 (German-market version), Amsterdam, Oct 2013

2014 BMW i3 (German-market version), Amsterdam, Oct 2013

The 2014 BMW i3 will be the first electric car that offers a range-extending combustion engine, which roughly doubles the miles it can cover, as an option.

Without the engine, the BMW i3 is a conventional battery-electric vehicle, or BEV, and it qualifies for incentives as such. But add the engine, known as REx, and things appear to get murkier.

Confusion arose because under California law, the BMW i3 with REx is the first of a new category of plug-in electric cars, known as a BEVx.

A BEVx is a car that operates largely on its battery, and whose range extender won't turn on until the battery is depleted (unlike all of the rest of the plug-in hybrids on the market).

Even when it does turn on, its total range on gasoline has to be less than its range on battery power--which must be rated by the EPA at 75 miles or more. 

MORE: First Review In: 2014 BMW i3 Range Extender Performance Limited

The confusion about incentives seems to have arisen because California zero-emission vehicle regulations permit a BEVx to count toward a carmaker's "ZEV gold credits"--effectively, the number of zero-emission vehicles it sells (even though the i3 REx may produce tailpipe emissions in range-extending mode).

2014 BMW i3 (German-market version), Amsterdam, Oct 2013

2014 BMW i3 (German-market version), Amsterdam, Oct 2013

Under all other regulations, though, the BEVx designation simply doesn't matter. A regular BMW i3 is a fully-electric car, and a BMW i3 REx is deemed a plug-in hybrid for any other incentive program.

That puts the range-extended i3 in the same category for California's plug-in purchase rebate and its carpool-lane access as the California-spec Chevrolet Volt, Toyota Prius Plug-In Hybrid, and other cars that plug in but also have combustion engines.

So, here's our list of BMW i3 incentives and qualifications.

Note that some of them have not yet been finalized by the appropriate regulatory authorities--although our interviews suggest there won't be any changes to this list.

FEDERAL INCOME-TAX CREDIT for purchase of plug-in car

  • BMW i3 BEV: Eligible buyers can take a credit of up to $7,500 on their Federal income taxes for the year in which they purchased the car
  • BMW i3 REx: Same

CALIFORNIA PURCHASE REBATE for purchase of plug-in car

  • BMW i3 BEV: $2,500
  • BMW i3 REx: $1,500


  • BMW i3 BEV: White sticker for zero-emission vehicles, expires January 1, 2019, supply currently unlimited.
  • BMW i3 REx: Green sticker for plug-in hybrid vehicles, expires January 1, 2019, supply limited to 40,000 (of which roughly 28,700 had been issued as of December 31)

The i3's eligibility for these incentives will be finalized before the car goes on sale, as will its EPA-rated electric range, its energy efficiency in MPGe, and its gas mileage operating in range-extending mode.

The 2014 BMW i3 carries a base price of $42,275 for the battery-electric version, and the REx range extender is a $3,850 option. Further information on trim levels and optional equipment will be issued closer to the on-sale date.


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