Tesla Could Get Environmental Protection Rules Waiver In California

Giuseppe Macri Tech Editor
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In an effort to entice Tesla Motors into building its forthcoming battery factory in California, the state is preparing to offer the world’s leading green automaker a manufacturing incentive package that waives costly state environmental protection laws.

Tesla is headquartered in Palo Alto, Calif. and builds its cars in a former Toyota factory in Fremont, but the Golden State is last on the list of possible locations to build its lithium-ion battery “Gigafactory,” which will be the largest in the world at the time of its estimated completion in 2017. (RELATED: Report: Tesla And Panasonic Team Up To Build Battery Gigafactory)

Though the state has less to offer than Arizona, Nevada, New Mexico or Texas as a result of restrictive manufacturing regulations, the state is reportedly trying to make up for it by creating a custom building incentive package for Tesla that includes a waiver for construction-related environmental protection laws. (RELATED: Texas Gov. Rick Perry Wants Tesla In Texas)

California state Sen. Ted Gaines recently told The Los Angeles Times that the package currently being negotiated by the office of Gov. Jerry Brown would specifically exempt Tesla from parts of the nearly 50-year-old California Environmental Quality Act.

The governor’s package would speed up or skip over requirements for reviews by local and state government agencies intended to asses possible environmental threats posed by development, and offer up to $500 million in tax breaks, roughly equal to 10 percent of the Gigafactory’s estimated cost.

Time is a crucial factor according to Tesla founder and CEO Elon Musk, who said the company needs to complete the factory before rolling out its recently announced fourth model — the Tesla Model 3, which will halve the price of its $70,000 Model S as a result of cheaper production costs afforded by the factory. (RELATED: S-E-X SELLS: Tesla’s New Model Fills Out The Company Lineup)

During Tesla’s second-quarter earnings announcement at the end of last month, Musk said the company was conducting exploratory excavation work at a Reno Nevada site. Tesla is reportedly doing similar work at two other sites in order to begin construction immediately after selecting a final location.

The factory is expected to bring some 6,500 jobs to the state with the best offer.

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