For electric vehicle drivers in Hawaii, there will soon be few, if any, perks left — as some of the most popular ones are set to expire this month.
Solo drivers with EV license plates have since 2012 been permitted to use the high-occupancy vehicle lane on Oahu highways, which are usually reserved for cars with at least two occupants during rush hour to encourage carpooling.
On Sept. 30, a federal code allowing states to set their own HOV lane requirements expires, and federal tax credits of up to $7,500 for the purchase or lease of EV vehicles also end.
These changes come at a time when Hawaii is being held accountable for its ambitious, state-mandated goals of achieving 100% clean energy and net-zero emissions by 2045, and are expected to hamper efforts to get more residents to drive electric in order to reduce greenhouse gas emissions.
“It definitely doesn’t help,” said state Rep. Nicole Lowen, chair of the House Energy and Environmental Protection Committee. “Taking incentives away isn’t pushing things in the right direction.”
Still, she thinks most of the impetus behind EV adoption has been market driven.
The HOV lane perk may have been an incentive for some drivers commuting on the H-1 freeway to go electric, but even without it, EVs remain a competitive choice for consumers, she said, because they cost less to own and operate in the long run.
There are fewer maintenance costs, such as a regular oil changes, and no more waiting in line at the gas station.
“From a consumer point of view, there’s still a really strong case for it,” she said. “I think we’ll continue to see people buying EVs.”
History of perks
In an effort to boost the adoption of EVs, Hawaii passed a law in 2012 that offered a smorgasbord of perks.
EVs were not only allowed to use the HOV lane with only one occupant, but granted free parking at street parking meters, in state and county parking lots, and at airport parking lots.
Those privileges sunsetted on July 1, 2020, but the state Department of Transportation extended the HOV perk for EV drivers.
DOT says it is complying with federal law come Sept. 30, but will retain language written into Hawaii’s administration rules should states be able to make their own rules once again.
Additionally, car consumers will no longer be eligible for a $7,500 in federal tax credits for the purchase of new EVs as a result of President Donald Trump’s “big, beautiful bill” adopted in July. Hawaii does not offer tax credits or rebates for the purchase of EVs.
The Electric Vehicle Association called the rollback of incentives a step in the wrong direction and “a lane change we can’t afford to make.”
EVA board member Elaine Borseth called the HOV lane perk “one of the simplest, most effective ways to encourage clean transportation,” and said it’s still necessary, given that EV adoption is still in a critical growth phase.
“We’re on our way, but we’re not there yet,” she said in a recent blog post. “Removing low-cost, high-impact incentives like HOV access risks slowing the momentum just when we need it most.”
EVs on the rise
Noel Morin, president of the Hawaii EV Association, said it is unfortunate to see these barriers to adoption, especially as sales are gaining momentum in the state.
The perks and tax incentives appear to have spurred the growth of EVs in Hawaii, with year-over-year increases over the past five years.
In July 2021 there were 15,551 registered EVs in Hawaii, which more than doubled to nearly 33,000 by July 2024. As of July this year, the state counted 38,086 registered EVs in Hawaii, a 16% increase from 2024.
EVs now represent 3.5% of the more than 1 million registered passenger vehicles in the state.
“If you look at the trajectory, more people are adopting EVs,” Morin said. “As people upgrade, and rental car companies dispense of EVs, it also means you have a pre-owned market.”
The range of EV batteries has improved, and there are an expanding number of EV options to choose from in the U.S., including ones that start at lower price points from brands such as Nissan, Chevrolet and Hyundai.
Locally, the expanding pre-owned EV market also offers consumers more affordable EV choices.
The addition of tariffs and Matson’s recent announcement that it will no longer ship EVs to Hawaii complicate the market outlook, but the days in which EVs were considered a rarity in Hawaii are over.
The Tesla Model Y, despite a drop in sales, is the third-most-popular vehicle in the state, according to Hawaii Auto Outlook, two notches below the Toyota Tacoma, which has long taken the top spot.
Hawaii also has been recognized as a top state in the U.S. for EV adoption.
J.D. Power last year ranked Hawaii third, behind California and Washington, in EV adoption based on an index weighing consumer preferences and availability. Hawaii was also among the top five EV markets, with EVs making up nearly 12% of new vehicle sales in the state.
Achieving EV equity
“We see an increase in EV registrations, so it’s steadily heading in the right direction, but obviously, not fast enough,” said Jeff Mikulina of Climate Hawaii. “The timing is very unfortunate for these new changes.”
While perks help get people in the door, he said, Hawaii needs a clean transportation program that works for everyone.
“So I think it’s on the state, now, particularly with this Navahine settlement, to really focus on equity and infrastructure, and making those take center stage,” he said.
That means making EVs more accessible for families, renters, and rural communities, he said, and investing in more charging stations, particularly for multifamily units — and doing everything possible to make clean transportation “the default as opposed to a luxury.”
DOT released a 205-page draft of its plan to reduce greenhouse gas emissions as part of a settlement of a lawsuit – Navahine vs. DOT — filed by a group of young climate activists.
Public comments on the draft were due by the end of Sunday.
As a legislator, Lowen has introduced bills seeking to expand EV charging infrastructure, including one offering rebates for EV-ready parking stalls in new affordable housing developments.
Morin agreed much more needs to be done to accelerate the adoption of EVs in the state if Hawaii is to reach its clean-energy goals.
Hawaii consumes nearly 40 million gallons of gasoline and diesel each month, and gas and diesel vehicles still make up 93% of all registered passenger vehicles in the state.
“It’s not just about EVs,” Morin said. “It’s about sustainable transportation. It’s about efficient transportation.”
That includes expanding other options like public transit, biking, walking, and rideshares.
“We want to be independent of fossil fuel imports,” Morin said. “We don’t want to be dependent on ships coming in to turn on our lights, transport our kids, or do our jobs. One way to do that is to achieve these goals.”
While it’s going to “take a little longer to make it happen,” he said, it doesn’t change the urgency of those aspirations.
Education is still a part of it, and Hawaii EV is hosting events locally from Sept. 12 to Oct. 12 to raise awareness on the numerous benefits of electric cars, trucks, and motorcycles as part of National Drive Electric Month.
Mikulina said the timing of the federal cutbacks is unfortunate, but is nevertheless confident that market demand for EVs will not go away, as global trends show the future is electric.
“Really, I think the momentum is so strong to electrify transportation and for clean energy,” said Mikulina, “that this is this is just a speed hump.”
CHANGES AFOOT FOR EV DRIVERS
>> On Sept. 30, the right to use the HOV lane during rush hour by solo EV drivers ends.
>> Where are HOV lanes? Oahu, the most populated isle in Hawaii, is home to most HOV lanes, which are available on the H-1 highway weekday mornings, as well as on H-2, Nimitz, Moanalua, and Kalanianaole highways.
>> On Sept. 30, federal tax credits of up to $7,500 for the purchase of eligible new EVs, and up to $4,000 for used EVs expires. These tax credits were originally set to last through Dec. 31, 2032, under the Inflation Reduction Act.
>> What to know: The IRS says a contract signed or down payment made for an EV before Sept. 30 is still eligible, even if the car is delivered at a later time. The vehicle must be acquired with a written binding contract before Sept. 30.
>> Starting in July, Hawaii EV owners could choose between paying a per-mile road usage charge of $8 per 1,000 miles, capped at $50, or annual fee of $50 (replacing the $50 EV surcharge). In 2028, all EV owners must pay the per-mile usage charge.
Source: DOT, IRS
EV STATS IN HAWAII
>> Hawaii has 38,086 registered passengers EVs.*
>> EVs represent 3.5%, while gas vehicles make up 93% of total registered passenger vehicles (1,078,070) in the state, according to the Department of Business, Economic Development & Tourism.
>> Year-over-year growth of registered EVs: July 2021 (15,551), July 2022 (20,240), July 2023 (26,411), July 2024 (32,947), July 2025 (38,086).
*As of July
Source: DBEDT, Hawaii EV Association
Source: The Garden Island