Rockefeller Proposes Alternative Fuels Credit

Cosponsor Mike Crapo, R-Idaho, said the bill "supports the further development of vehicles that are powered by electricity, fuel cells, methanol, and various forms of natural gas. . . . The enactment of tax incentives for emerging technologies is the logical way to encourage the development of cost effective alternative fueled vehicles, without the government mandating a preference." Text of the bill appears in the Record.

THE ALTERNATIVE FUELS PROMOTION ACT OF 1999

Mr. ROCKEFELLER. Mr. President, I am proud to introduce today with my colleagues Senators Hatch, Crapo, and Bryan the Alternative Fuels Promotion Act. This is an important bipartisan piece of legislation providing tax incentives to help stimulate the still fledgling alternative fuel vehicle industry. It creates a $0.50 per gasoline equivalent gallon tax credit for natural gas, methanol, propane and hydrogen, thus almost leveling the tax treatment for all alternative fuels. The bill also contains provisions for extending the electric vehicle tax credit and augmenting it to encourage advanced technology vehicles. It also expands the existing tax deduction for alternative fuel fueling infrastructure to include the cost of installation. Finally, the bill gives states the authority to allow single occupant alternative fueled vehicles on high occupancy vehicle (HOV) lanes.

I introduce this bill today because I believe that it is time for the next automobile revolution.

I say revolution because as Webster's tells us, the word can mean "a fundamental change in the way of thinking about something."

One compelling argument for pursuing fundamental change when it comes to automobiles is the fact that we still need to reduce this nation's dependence on imported oil, for obvious reasons. After all, Saddam Hussein didn't invade Kuwait to increase his supply of sand. We are at an historic high in our dependence on imported oil. Currently, we import approximately one half of the oil consumed in this nation. According to the Energy Information Administration, that level is expected to increase to more than sixty percent within the next decade, unless we do something dramatic to reverse the current trend. Even more foreboding is the fact that most of the oil we import is from the Middle East. It makes no sense for us to stand idly by as this volatile region of the world increases its potential stranglehold over the world's economy.

It is also critical that we reduce the transportation sector's negative impact on air quality. We are in the midst of an alarming increase in reported asthma and other respiratory diseases. This problem is especially acute among children and senior citizens. While the automobile industry has made great strides in reducing emissions from cars and trucks, the improvement has been largely offset by the dramatically increasing number of cars, sport utility vehicles and trucks on the road and the increasing number of miles these vehicles are driven each year. Clearly, doing something to cut air pollution and reduce greenhouse gas emissions, for example, requires enormous change in transportation.

The options for bringing about change in the transportation sector are limited. We can pursue punitive new taxes, mandates, or regulations. This approach, I believe, would result in job losses and economic stagnation, situations that are not acceptable to either the American people or the Congress. I believe the best way to bring about the change we need is to provide incentives -- to manufacturers to develop and sell clean technology -- and to consumers to buy and use that technology.

The domestic automobile manufacturers have been developing a full menu of clean, efficient vehicles for the 21st century. And unlike before, these vehicles are much closer to their gasoline- powered counterparts in terms of performance, safety, comfort, and cost. Just recently, two of our biggest automobile manufacturers unveiled their latest fuel-cell-powered vehicles -- the alternative fuel vehicle considered by many to be the car of the 21st century. Much of the technology incorporated into such advanced transportation technologies -- hybrids, electric vehicles with advanced batteries, fuel cell vehicles as well as bi-fuel and flex-fuel vehicles -- are a direct result of the work government and industry have done together, in full partnership, through programs like the United States Advanced Battery Consortium and the Partnership for a New Generation of Vehicles.

Perhaps most exciting is that some of these "cars of the future" are available today. Electric vehicles are being sold, albeit in small numbers, to fleets nationwide, and to select target markets in California and Arizona. Also, most major automakers have alternative fuel vehicles available for either fleet or private purchase.

And there is encouraging news on the infrastructure front as well. Alternative fuel providers and electric utilities throughout the country are putting the infrastructure in place to support alternative fuel and electric vehicles in operation. By the end of 1998, nearly 300 public charging sites with more than 600 chargers, as well as hundreds of home chargers, and a number of fleet installations, were established throughout California and Arizona. We need more of this to happen nationally. There are also more than 110 methanol stations nationwide supporting alternative and flex fuel vehicles. Also, compressed natural gas and other natural gas-based fuels are developing infrastructure as well. For example, in my state of West Virginia alone there are over 40 compressed natural gas fueling stations.

I think this is all evidence that we have indeed initiated an automotive revolution. Unfortunately, the market hasn't developed as quickly as we thought it would when we passed the Energy Policy Act of 1992 with such high hopes. And perhaps we were too optimistic about what would be required by both government and industry to build a sustainable market for the technology.

So, what can we do to speed things up? How can we make sure there are more vehicles available, get more people to buy them, and develop the infrastructure to sustain them?

First, as I mentioned earlier, the alternative fuel and electric vehicle markets started more slowly than I think many of us expected. Therefore, we need to extend the phase-out dates of current tax credits. This would continue to help us "jumpstart" the market for electric vehicles, and lay out a longer-term incentive policy. Also, I feel that hard work and progress should be encouraged. Electric vehicles with extended range capability are the result of additional investments in research and technology. This behavior needs to be rewarded.

Second, there needs to be more support for the development of an effective alternative fuel fueling infrastructure. For too long, we been caught in a 'chicken and egg' cycle, with the infrastructure not available to support alternative fuel vehicles, and consumers not interested in the vehicles because there's not support infrastructure. We need to break this cycle by creating better tax incentives to help develop alternative fuel infrastructure. The current tax deductions for capitol equipment is not sufficient since a large portion of the overall cost may be associated with the actual cost of installation.

Finally, we must make alternative fuels, like natural gas, methanol, propane and hydrogen, economically attractive to producers, distributors, marketers and buyers. If consumers see affordable new fuels available at their local fueling stations, they will be much more likely to actually use an alternative fuel vehicle. Tax incentives have traditionally been very effective in encouraging consumers to try new technology. While changing consumer's behavior is not easy, I am confident that if people begin to see that alternative fuels are available and affordable, they will soon begin to use them. Without the economic drive at every link in the fuel chain any alternative fuel effort will not succeed.

This is why today I along with my colleagues are introducing the Alternative Fuels Promotion Act.

This bill contains provisions for extending the $4,000 tax credit for electric vehicles until 2010. It also grants an additional $5,000 tax credit for electric vehicles that meet a 100 mile range requirement. These provisions will help electric vehicle commercialization and research to move forward at a faster pace, and will mean that more people will be able to buy electric vehicles.

However, few people will buy electric vehicles and other alternatively fueled vehicles if there is nowhere to refuel them. I want to encourage the development of these stations. Therefore, my bill expands the current tax deduction for alternative fuel fueling capital equipment to include the cost of installation. This will allow more infrastructure for electric and alternative fuel vehicles to be installed and used.

The Alternative Fuels Promotion Act also makes clean-burning alternative fuels economically attractive. The bill provides a $0.50 per gasoline equivalent gallon tax credit to the seller of compressed natural gas, liquefied natural gas, methanol, propane or hydrogen. This will allow these non-petroleum fuels to become more economically favorable to the consumer through lower prices at the pump. It also places these fuels on tax parity with other alternatives. By giving the tax credit to the seller of the fuel, it reduces the paperwork burden on the individual consumer, and allows for easier dispersal of the credit throughout the production/delivery/marketing chain so that all parties are interested in increasing the consumption of alternative fuels.

Finally, the Alternative Fuel Promotion Act gives states the ability to decide if they want to allow single occupant alternative fuel and electric vehicles in HOV lanes. This is, I feel, a strong incentive that states should be allowed, but not required, to give to owners of these special vehicles.

We know that when national policy works in support of the energies and potential of the private sector, far more progress can be made at a far faster rate. The private sector is leading the way in developing alternatives fuel vehicle technology. We need to provide consumers with a strong financial incentive to use this technology. Certainly, our continued dependence on foreign oil and the contribution of conventionally powered vehicles to air pollution should drive us to try. In my case, I see exciting prospects for new uses of West Virginia's natural resources and other economic benefits for my state -- along with other states. I encourage my colleagues to support this bill and I ask unanimous consent that the text of the bill appear in the Record.

There being no objection, the bill was ordered to be printed in the Record, as follows:

S. 1003

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the "Alternative Fuels Promotion Act".

SEC. 2. FINDINGS.

The Senate finds the following:

(1)(A) Since 1994, the United States has imported over half its oil.

(B) Without efforts to mitigate this dependence on foreign oil, the percentage of oil imported is expected to grow to all-time highs.

(C) This reliance on foreign oil presents a national security risk, which Congress should address through policy changes designed to increase the use of domestically-available alternative transportation fuels.

(2)(A) The importing of a majority of the oil used in the United States contributes negatively to the balance of trade of the United States.

(B) Assuring the Nation's economic security demands the development and promotion of domestically-available alternative transportation fuels.

(3)(A) The reliance on oil as a transportation fuel has numerous negative environmental consequences, including increasing air pollution and greenhouse gas emissions.

(B) Developing alternative transportation fuels will help address these environmental impacts by reducing emissions.

(4) In order to encourage installation of alternative fueling infrastructure, and make alternative fuels economically favorable to the producer, distributor, marketer, and consumer, tax credits provided at the point of distribution into an alternative fuel vehicle are necessary.

(5)(A) In the short-term, United States alternative fuel policy must be made fuel neutral.

(B) Fuel neutrality will foster private innovation and commercialization using the most technologically feasible and economic fuels available.

(C) This will allow market forces to decide the alternative fuel winners and losers.

(6)(A) Tax credits which have been in place have led to increases in the quantity and quality of alternative fuel technology available today.

(B) Extending these credits is an efficient means of promoting alternative fuel vehicles and alternative fueling infrastructures.

(7)(A) The Federal fleet is one of the best customers for alternative fuel vehicles due to its combination of large purchasing power, tight record keeping, geographic diversity, and high fuel usage.

(B) For these reasons, the National Energy Policy Act of 1991 required Federal fleets to purchase certain numbers of alternatively- fueled vehicles.

(C) In most cases, these requirements have not been met.

(D) Efforts must be made to ensure that all Federal agencies comply with Federal fleet purchase requirement laws and executive orders.

TITLE I -- TAX INCENTIVES

SEC. 101. CREDIT FOR QUALIFIED ELECTRIC VEHICLES.

(a) Increased Credit for Vehicles Which Meet Certain Range Requirements. --

(1) In general. -- Section 30(a) of the Internal Revenue Code of 1986 (relating to allowance of credit) is amended to read as follows:

"(a) Allowance of Credit. --

"(1) In general. -- There shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the sum of --

"(A) 10 percent of the cost of any qualified electric vehicle placed in service by the taxpayer during the taxable year, plus

"(B) in the case of any such vehicle also meeting the requirement described in paragraph (2), $5,000.

"(2) Range requirement. -- The requirement described in this paragraph is a driving range of at least 100 miles --

"(A) on a single charge of the vehicle's rechargeable batteries, fuel cells, or other portable source of electrical current, and

"(B) measured pursuant to the urban dynamometer schedules under appendix I to part 86 of title 40, Code of Federal Regulations.".

(2) Conforming amendment. -- Section 30(b)(1) of the Internal Revenue Code of 1986 is amended by striking "subsection (a)" and inserting "subsection (a)(1)(A)".

(b) Credit Extended Through 2010. --

(1) In general. -- Section 30(e) of the Internal Revenue Code of 1986 (relating to termination) is amended by striking "2004" and inserting "2010".

(2) Conforming amendments. -- Section 30(b)(2) of such Code (relating to phaseout) is amended --

(A) by striking "2002" in subparagraph (A) and inserting "2008",

(B) by striking "2003" in subparagraph (B) and inserting "2009", and

(C) by striking "2004" in subparagraph (C) and inserting "2010".

(c) Effective Date. -- The amendments made by this section shall apply to property placed in service after the date of enactment of this Act.

SEC. 102. ADDITIONAL DEDUCTION FOR COST OF INSTALLATION OF ALTERNATIVE FUELING STATIONS.

(a) In General. -- Subparagraph (A) of section 179A(b)(2) of the Internal Revenue Code of 1986 (relating to qualified clean-fuel vehicle refueling property) is amended to read as follows:

"(A) In general. -- The aggregate cost which may be taken into account under subsection (a)(1)(B) with respect to qualified clean- fuel vehicle refueling property placed in service during the taxable year at a location shall not exceed the sum of --

"(i) with respect to costs not described in clause (ii), the excess (if any) of --

"(I) $100,000, over

"(II) the aggregate amount of such costs taken into account under subsection (a)(1)(B) by the taxpayer (or any related person or predecessor) with respect to property placed in service at such location for all preceding taxable years, plus

"(ii) the lesser of --

"(I) the cost of the installation of such property, or

"(II) $30,000.".

(b) Effective Date. -- The amendment made by this section shall apply to property placed in service after the date of enactment of this Act.

SEC. 103. CREDIT FOR RETAIL SALE OF CLEAN BURNING FUELS AS MOTOR VEHICLE FUEL.

(a) In General. -- Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to business related credits) is amended by inserting after section 40 the following:

"SEC. 40A. CREDIT FOR RETAIL SALE OF CLEAN BURNING FUELS AS MOTOR VEHICLE FUEL.

"(a) General Rule. -- For purposes of section 38, the clean burning fuel retail sales credit of any taxpayer for any taxable year is 50 cents for each gasoline gallon equivalent of clean burning fuel sold at retail by the taxpayer during such year as a fuel to propel any qualified motor vehicle.

"(b) Definitions. -- For purposes of this section --

"(1) Clean burning fuel. -- The term 'clean burning fuel' means natural gas, compressed natural gas, liquefied natural gas, liquefied petroleum gas, hydrogen, and any liquid at least 85 percent of which consists of methanol.

"(2) Gasoline gallon equivalent. -- The term 'gasoline gallon equivalent' means, with respect to any clean burning fuel, the amount (determined by the Secretary) of such fuel having a Btu content of 114,000.

"(3) Qualified motor vehicle. -- The term 'qualified motor vehicle' means any motor vehicle (as defined in section 179A(e)) which meets any applicable Federal or State emissions standards with respect to each fuel by which such vehicle is designed to be propelled.

"(4) Sold at retail. --

"(A) In general. -- The term 'sold at retail' means the sale, for a purpose other than resale, after manufacture, production, or importation.

"(B) Use treated as sale. -- If any person uses clean burning fuel as a fuel to propel any qualified motor vehicle (including any use after importation) before such fuel is sold at retail, then such use shall be treated in the same manner as if such fuel were sold at retail as a fuel to propel such a vehicle by such person.

"(c) No Double Benefit. -- The amount of the credit determined under subsection (a) shall be reduced by the amount of any deduction or credit allowable under this chapter for fuel taken into account in computing the amount of such credit.

"(d) Termination. -- This section shall not apply to any fuel sold at retail after December 31, 2007.".

(b) Credit Treated as Business Credit. -- Section 38(b) of the Internal Revenue Code of 1986 (relating to current year business credit) is amended by striking "plus" at the end of paragraph (11), by striking the period at the end of paragraph (12) and inserting ", plus", and by adding at the end the following:

"(13) the clean burning fuel retail sales credit determined under section 40A(a).".

(c) Transitional Rule. -- Section 39(d) of the Internal Revenue Code of 1986 (relating to transitional rules) is amended by adding at the end the following:

"(9) No carryback of section 40A credit before effective date. - - No portion of the unused business credit for any taxable year which is attributable to the clean burning fuel retail sales credit determined under section 40A(a) may be carried back to a taxable year ending before January 1, 1999.".

(d) Clerical Amendment. -- The table of sections for subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 40 the following:

"Sec. 40A. Credit for retail sale of clean burning fuels as motor vehicle fuel.".

(e) Effective Date. -- The amendments made by this section shall apply to fuel sold at retail after December 31, 1999, in taxable years ending after such date.

TITLE II -- PROGRAM EFFICIENCIES

SEC. 201. EXCEPTION TO HOV PASSENGER REQUIREMENTS FOR ALTERNATIVE FUEL VEHICLES.

Section 102(a) of title 23, United States Code, is amended by inserting "(unless, at the discretion of the State highway department, the vehicle operates on, or is fueled by, an alternative fuel (as defined in section 301 of Public Law 102-486 (42 U.S.C. 13211(2)))" after "required".

Mr. HATCH. Mr. President, I rise today as an original cosponsor of the Alternative Fuels Promotion Act, together with my colleagues, Senators Rockefeller, Crapo, and Bryan. The legislation we introduce today will help to solve one of our Nation's most expensive problems -- air pollution.

As air pollution was introduced at the beginning of this century, it is fitting that, at century's end, we should find solutions to this vexing problem.

Automobiles are a major source of pollution in our urban areas. Past efforts to address this mobile-source pollution have been fraught with pitfalls; and, as a result, the effort to control automobile emissions has progressed in fits and starts. The Alternative Fuels Promotion Act avoids past mistakes, leaving behind command-and-control mandates from Congress and providing market-based incentives for consumers and for much needed infrastructure development.

Mr. President, as we speak, my State of Utah is engaged in a mammoth road construction project on Interstate 15. This freeway runs right through Salt Lake City and through three counties in Utah that have struggled to meet national clean air standards.

It might suggest that we should not improve or repair highways. Could it be that the availability of convenient and efficient roadways is in part responsible for our emissions problem? I doubt it. While the Eisenhower vision of a vast nation connected by interstate highways may have encouraged more people to commute or vacation by car, the fact is that vehicular traffic is increasing almost everywhere. One-car families have become two-car and three-car families.

I do not believe that more cars crowded onto old and inefficient highways is the answer. In fact, slow-moving traffic is part of the problem.

According to a recent study by Utah's Division of Air Quality, on-road vehicles account for 22 percent of coarse particulate matter in Utah. Particulate matter can be harmful to those already suffering from chronic respiratory or heart disease, influenza, or asthma. Automobiles also account for 34 percent of hydrocarbon and 52 percent of nitrogen oxide emissions in my state. These two pollutants react in sunlight to form ozone, which in turn reduces lung function in humans and hurts our resistance to colds and asthma. Ozone may also lead to premature aging of lung tissue. In Utah, vehicles account for a whopping 87 percent of carbon monoxide emissions. Carbon monoxide can be harmful to persons with heart, respiratory, or circulatory ailments.

Mr. President, while Utah has made important strides in improving air quality, more vehicular miles are driven every year. If we are to have cleaner air, we must encourage low emission alternative fuels or electric power.

The need for alternative fuels will dramatically increase as the Environmental Protection Agency continues to implement its new, stricter clean air standards. With the tighter standards, some of Utah's counties will, once again, face non-attainment. Under the Clean Air Act, the EPA can impose sanctions on a state's highway fund if it determines a state has not adequately implemented plans to attain air quality standards, a sanction which, as I have suggested, may actually be counterproductive.

Nevertheless, non-attainment can be a costly enterprise, whether due to the loss of federal highway money or to the expensive measures taken to reach attainment. And, as I have suggested, may be counterproductive.

By the EPA's own estimates, the annual cost of achieving the new ozone standard in 2010 will be about $9.6 billion. Additionally, the EPA puts the annual cost of achieving the PM 2.5 standard at $37 billion, making for a combined total cost of $47 billion annually. Mr. President, our most recent census count estimated that there are 65 million families in the U.S. So, by the EPA's own account, implementing the new air quality standards will cost about $723 per family every year.

Wouldn't it be wise, Mr. President, to invest some of that money in the development of alternative fuels?

Take natural gas as an example. Natural gas is one of the cleanest burning fuels available. Add to this, methanol, propane has a variety of options that would allow Americans to continue to drive their cars, while dramatically cutting back on air pollution.

Mr. President, research has brought us a number of excellent options to replace our dependency on traditional gasoline powered autos. It appears that our last obstacle remains bringing these alternatives to the marketplace. Past efforts to do so have failed to produce the hoped-for results because they have been too heavy on mandates and too weak on incentives to car buyers and to improve infrastructure.

Clearly, if consumers are to begin buying alternative fuel vehicles, two elements must be in place: first, the price for vehicles and their fuel must be right; second, the consumer must feel confident that the infrastructure is in place with refueling stations widely available.

This is where the Alternative Fuels Promotion Act comes into play. With this legislation, we take important steps forward to meet these goal without mandates. The only requirement in this bill is that federal agencies submit an annual report on their use of alternative fuel vehicles in their fleets.

The Alternative Fuels Promotion Act encourages customers to purchase alternative fuels through a tax credit. Congress has already given ethanol users a tax credit of 54 cents per gallon. When adjusted for its energy capacity, ethanol's gasoline-gallon equivalent credit equals 82 cents. Our legislation levels the playing field by extending a 50-cent gasoline-gallon equivalent tax credit for the other alternative fuels, such as hydrogen, natural gas, propane, methanol, and electricity.

There currently exists a tax credit for the purchase of electric vehicles. Our bill would extend the life of that credit, giving a continued incentive for companies to develop this technology. The current tax credit equals 10 percent of the purchase price of the vehicle, up to $4,000. Our legislation would extend the sunset date for this credit to 2010 and give an additional $5,000 credit toward any electric vehicle with a range over 100 miles.

Mr. President, consumers will never be interested in alternative fuel vehicles until a strong infrastructure is developed. Under current law, there is a $100,000 tax deduction for the capital costs of equipment at alternative fuel stations. This legislation extends that benefit to construction and installation costs at a new filling station. Often constructions costs outweigh capital costs as a barrier to the installation of new alternative fuel stations.

These measures will jump start a movement already under way toward increased use of alternative fuel vehicles. In California and Arizona there are already about 300 public charging sites for electric vehicles. Utah has led the way in natural gas infrastructure. An owner of a natural gas vehicle can crisscross my state from Logan in the north to St. George in the south, and from Salt Lake to the eastern border finding filling stations all along the way. This is progress, but much more needs to be done.

Mr. President, I believe the momentum is building in this nation for a leap forward in the use of alternative fuel vehicles. There is broad agreement that our approach with this legislation is the proper course to help promote this step. In a letter to me, Utah's Clean Cities Coalition signaled its support for this measure. I quote, "We believe that for the people living in urban Utah now is a good time to take strong action to encourage Utahns to buy alternative, clean- burning vehicles. We ask that you support the 50-cent per gallon tax credit."

This bill has also gained the support of the Wasatch Clean Air Coalition in Utah. They stated, "We believe this tax credit would have a strong positive impact on our local air quality by encouraging the use of alternative fuels, and increasing the portion of cars on our roads fueled by alternative fuels."

Finally, the American Lung Association has told me that, "Motor vehicles are a major source of pollution along the Wasatch Front. While automobiles do run cleaner these days, and while alternative forms of transportation are being considered, more needs to be done to address the current and future sources of emissions and poor air quality. One reasonable strategy to cut down on the amount of pollutants in the air is to increase the use of clean fuel vehicles. Vehicles that run on natural gas, propane or electric simply are cleaner burning than those fueled by gasoline or diesel. . . . This legislation will encourage an increased number of clean fuel vehicles on the road, and clean air for years to come."

Mr. President, I think we all know that 50 years down the road, we will not still be using petroleum fueled vehicles to the same extent we do today. This legislation is an attempt to bring the benefits of cleaner air to our citizens sooner, to free our cities from expensive EPA regulations, and to reduce our consumption of foreign oil. This legislation enables us to tackle these problems with incentives, not mandates. I urge my colleagues to join us in this future-minded approach to cleaning our air.

Mr. CRAPO. Mr. President, I rise in support of the Alternative Fuels Promotion Act, which is introduced today by Senators Rockefeller, Hatch, Bryan, and myself.

There are many reasons for my support of the Alternative Fuels Promotion Act offered today, in the Senate. A number of those reasons may not be immediately evident, given that the merits of alternative fuels are most often spoken in terms of environmental protection. While there are significant environmental benefits that can be gained from this bill, there are also benefits to be obtained in national security, promotion of the domestic oil industry, the encouragement of business development and innovation, and increased options for the consumer.

Over half of the oil consumed in the United States is produced overseas. Internal combustion vehicles, cars, and trucks, are the primary market for this cheap and readily available source of energy. We, as a nation, have become complacent in our assumption that this stream of easily obtainable fuel will flow forever. It is time for this assumption to be challenged. Most of us have viewed this as simply an economic issue: buy what is cheapest and most available. However, this source of fuel is vulnerable to interruption by foreign governments through changing attitudes toward the U.S., foreign policy or military conflict. The United States should take positive and sure steps toward developing domestically available alternative sources of fuel in order that our economy and accustomed way of life cannot be threatened by the whims and troubles of those outside of our borders.

The flood of foreign oil into the U.S. has left the domestic oil industry fighting for its life. Our support for alternative fueled vehicles should not be interpreted as a challenge or competition to the domestic oil industry. In direct contrast, it recognizes the importance of that industry of our national security. Petroleum products and fuels, including gasoline, will be needed far into the future for the transportation requirements of individuals, mass transportation, and conveyance of goods. The development of alternative fuels that are plentiful in this country, in conjunction with support for our domestic oil industry, will provide us a level of economic national security that we have not experienced for most of this century. By our efforts to revive the U.S. oil industry and the development of alternative fuels and vehicles, we will not be held hostage by foreign governments in gas lines again.

The number of innovative alternative fuel technologies is encouraging. This bill supports the further development of vehicles that are powered by electricity, fuel cells, methanol, and various forms of natural gas. Tax incentives are already in place for other technologies such as ethanol. Support for all promising alternative fuels is warranted in order to give consumers options for choosing those vehicles that will best serve their needs; whether a company requires a fleet of natural gas powered buses to transport their employees of work sites, or an individual's preference for an electric vehicle for in-town use to commute to work or run errands.

The enactment of tax incentives for emerging technologies is the logical way to encourage the development of cost effective alternative fueled vehicles, without the federal government mandating a preference. Leveling the tax incentive playing field within the alternative fuel energy sector will encourage partnerships between traditional providers of transportation and fuel products, and new companies with promising innovations. Instead of fighting change, traditional industry providers will participate in it and benefit from it. Increased market demand for alternative fuel vehicle technologies will also provide an opportunity and an incentive for the federal government to place greater emphasis on research and development in this industry sector. The results of which can then be leveraged into the private market.

While the environmental benefits of cleaner burning fuels are often the most talked about and often the most evident; we should not discount the benefits that can be gained by developing our nation's energy independence.