New Fees on Electric Vehicles and Hybrids Creating Anger, Confusion

The Delaware Division of Motor Vehicles (DMV) recently notified the owners of "alternative fuel vehicles" (AFVs) — primarily electric vehicles and hybrids — advising them of the implementation of a new registration fee effective October 1. 

Owners of these vehicles will receive their registration fee invoice in the mail and/or email, with payment due by November 1.

The new charge is the result of the enactment of House Bill 164, a contested piece of legislation that mainly consisted of a package of fee hikes requested by the Delaware Department of Transportation (DelDOT). 

The bill also created the new AFV fee to capture the owners of vehicles not solely powered by gasoline or diesel. For decades, the state and federal governments have imposed taxes on these commodities, the revenue from which is the leading source of funding for road maintenance and construction. The people using vehicles not powered by traditional fuels have avoided paying this support.

A 2024 report by the University of Delaware predicted that Delaware’s motor fuel tax revenue will drop sharply in the future as more electric vehicles are purchased, more people work remotely, and fuel economy improves. Between FY24 and FY25, motor fuel tax revenue declined by $2.2 million.

State Rep. Rich Collins joined 12 other House members in opposing the legislation, arguing that there were better alternatives to raising fees and imposing new charges.

In a message to lawmakers, Delaware Secretary of Transportation Shante Hastings said the inclusion in the new fee structure of hybrid vehicles, which use traditional fuels, has raised questions. "Yes, hybrids do use gas and therefore pay the motor fuel tax," she said. "They also use less gas than a fully gas-powered vehicle, which means they aren’t paying their equitable share. This is why they were included."

Based on data from the Eastern Transportation Coalition, it’s estimated that the average annual motor fuel tax paid by Delawareans is $115.

Delaware's AFV fees vary by vehicle type and weight. For example, the fee imposed on hybrid vehicles is $60 per year; the plug-in hybrid fee is $85 per year, and the EV/other fuel vehicle fee is $110 per year. To see a complete list, please click here.

According to the National Conference of State Legislatures, Delaware is the 41st state to implement fees on EVs and the 34th state to levy fees on hybrid vehicles. 

For questions or for further assistance, contact the DMV via email DMVCustomerService@delaware.gov or by calling 302-744-2500. 

To get answers to frequently asked questions, and receive future AFV registration fee information and invoices delivered securely via email, customers can register for eNotifications using this link: https://dmv.de.gov/OnlineServices/RegRenewalNotification/index.shtml?index.shtml?dc=notification