The movement towards zero emission electric cars is gaining a tremendous amount of momentum. As we move into 2010, practical electric vehicles for the vast majority of the public will be available late in the year with the release of the Nissan Leaf. The shift that may occur in the coming years provides the opportunity to engage in open dialogue about the tax benefits and burdens as the US moves into the era of the electric car.

If you plan to purchase an electric car in 2010, you can expect a healthy federal income tax credit to reward you. For plug-in electric vehicles with a gross vehicle weight of less than 14,000 pounds acquired after December 31, 2009, the maximum tax credit available will be $7,500. The base amount of the credit is $2,500. If the car has a battery capacity of at least 5kWh, then an additional $417 in tax credits will be available. For every kWh of battery capacity in excess of 5kWh, $417 will be added to the total amount. The additional amount, based on battery capacity, over the base amount is limited to a total of $5,000.

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Some heavyweights who know a thing or two about transportation are having a pointed online debate about whether or not electric vehicles should receive support from the federal government.

Terry Tamminen, who was Secretary of the California Environmental Protection Agency under Republican Governor Arnold Schwarzenegger, threw down the gauntlet last month in an editorial in which he stated that “it’s time to dump the battery-powered car in the same policy landfill as corn-based ethanol.”

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The future prospects of companies involved in electric vehicles continue to be greatly influenced by the support (or lack thereof) from the federal government. This week the government handed out another $300 million in funding for alternative fuel programs to Clean Cities initiatives around the country.

Of the 25 Clean Cities initiatives that received funding, 10 involved electric vehicles or vehicle charging stations. These projects will provide much-needed income to companies that produce batteries, vehicles, and charging stations. During this tight economy, even small orders such as these can provide a life line to startup companies looking for capital, as well as boost investor confidence.

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As hybrid cars are becoming more and more popular, most of the major car manufacturers are focusing on the development of pure electric vehicles (EVs). Up until recently, electric cars were impractically slow and short-ranged, but new technical developments allow them to better serve consumer needs. On August 2nd, the Renault-Nissan Alliance announced their new electric car called Leaf, which is due to be launched in 2010. Leaf has a range of 100 miles (160 km) and seats five adults. Tesla Motors will offer its Model S, also a five-seater, with a range of 300 miles starting in 2011.

The advantages of having lower operational costs and being more environmentally friendly are overshadowed by three major concerns; the range of the car, its price and the availability of charging stations. The range of an EV is related to technological developments in battery research and motor efficiency, and with further development in these areas the prices for EVs will drop significantly. Availability of charging stations, though, is an infrastructure issue which could be addressed when national targets are discussed.

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