DENVER (KDVR) — If you have an older gas-powered vehicle and are looking to upgrade to an electric vehicle soon, you may be in luck.

Applications for the Vehicle Exchange Colorado Program open Thursday, Aug. 31, at 9 a.m., and will provide EV purchase rebates to people in exchange for their older or high-emitting vehicles.

Colorado EV exchange rebate: The basics

There are two separate rebate amounts, depending on whether the EV you purchase or lease is new or used:

  • New EV: $6,000
  • Used EV: $4,000

Also, the program allows EV buyers to combine the state rebate with other rebates and incentives. This includes a $5,000 state tax credit and, potentially, a $7,500 federal tax credit.

Who qualifies for the EV rebate?

The program is only for income-qualified Coloradans. Essentially, only those who have a household income that’s no more than 80% of the area median income can sign up.

The area median income is based on two factors: household size and county of residence.

A single person living in Denver qualifies with an income of $69,520 or less. A family of four in Boulder qualifies with a household income of $106,240 or less.

What trade-in cars qualify?

Because the aim of the program is to recycle and replace old or high-emitting vehicles, an eco-friendly 2023 sedan won’t qualify.

To qualify, the model year has to be either 12 years or older — so 2011 or before if you’re applying in 2023 — or the vehicle has to fail an emissions test. The vehicles also have to be gas- or diesel-powered.

Additionally, the vehicle has to be operational, titled in Colorado and currently registered with the Department of Motor Vehicles.

There are a few vehicles that explicitly do not qualify. These include hybrids, recreational vehicles (RVs), campers and boats.

How much does the EV rebate cover?

Just like with gasoline-powered vehicles, there’s a wide variation in price for new and used electric vehicles.

For example, a 2023 Chevrolet Bolt EV starts at around $26,500. If you only take the $6,000 new vehicle rebate, that would leave $20,500 on the price tag.

However, if you don’t want a new vehicle, the average price for a used Chevrolet Bolt EV starts from $20,593 for a 2017 model, according to iSeeCars. That would leave $16,593 left to pay.

A new Tesla Model 3, on the other hand, starts at $40,240, while a used Tesla Model 3 starts at an average of $32,208 for a 2017 model. That would leave $34,240 to pay for the new model, and a potential $28,208 for a used model.

However, not every new and used dealership in the state is participating in the program. The state compiled a list of more than 30 dealerships that are participating.

Only purchases from these dealerships will qualify for the rebate, and the vehicle has to be bought or leased on or after Aug. 31, when the program starts.