Until now, the California Clean Vehicle Rebate Program offered incentives of $1,500 for plug-in hybrids, and $2,500 for electric cars.
Now, lower-income households will be able to get substantially more money for certain models.
Those with incomes less than 300 percent of the Federal Poverty Limit will now be able to get up to $3,000 for a plug-in hybrid, $4,000 for an electric car, and $6,500 for a hydrogen fuel-cell car.
At the same time, buyers with incomes over $250,000 will no longer be eligible for incentives on plug-in hybrids or electric cars.
However, these buyers still qualify for a $5,000 rebate on hydrogen fuel-cell cars.
This change in policy will primarily affect Tesla Motors, whose lineup starts at $75,000 this year.
From data gathered to date, it appears higher-income buyers are getting the majority of California rebates.
A survey from the second quarter of 2015 shows that about three quarters of rebates went to households earning more than $99,000 a year.
Those with incomes above $200,000 a year accounted for 26 percent of total rebates, while those with income under $99,000 represented 27 percent.
According to the California Air Resources Board, changes were made to direct the plug-in purchase incentives "towards those most likely to value the rebate the most."
For the 2015-2016 fiscal year, which began July 1, the Clean Vehicle Rebate Program also got a boost in funding, from $121 million to $163 million.
The program has issued $217 million in rebates since 2010.