Tesla has made nearly $2 billion selling surplus greenhouse gas credits.
In the United States, automakers earn greenhouse gas credits — also known as zero-emissions vehicle (ZEV) credits — from the government based on the number of electric vehicles they sell. Each manufacturer has to pay a fine if they don’t maintain a certain number of these credits, so the idea is that the system will encourage investment in EVs.
Since Tesla only makes EVs, it has a surplus of ZEV credits, so it’s been selling them to other automakers. This has allowed Tesla to generate nearly $2 billion in revenue since 2010 — but it’s also giving other automakers a pass to continue polluting the environment.
On Monday, Bloomberg published documents revealing two of the companies that have purchased ZEV credits from Tesla: GM and Fiat Chrysler. While Tesla’s sale of the credits wasn’t exactly a secret, this is the first time anyone had identified the buyers — and the fact that GM is one of them has raised some eyebrows.
It seems that while the company currently produces enough EVs to meet its credit requirements, GM is worried that it might not in the future if regulations tighten, so it’s purchasing the credits as “an insurance policy,” a GM spokesperson told TechCrunch.
That means Tesla is essentially providing GM with a way to avoid a speedy transition to EVs — which is supposed to be the point of the credits in the first place.
READ MORE: GM and Fiat Chrysler Unmasked as Tesla’s Secret Source of Cash [Bloomberg]