Obama Calls for New $1B Program to Promote ‘Alternative’ Vehicles

By Penny Starr | March 7, 2012 | 5:51pm EST

Jack Gerard, president and CEO of American Petroleum Institute, said at a House Subcommittee On Energy and Power hearing on March 7, 2012, that the U.S. is not using its own rich energy resources. (CNSNews.com/Penny Starr)

(CNSNews.com) – President Barack Obama used his visit to a North Carolina truck manufacturer on Wednesday to announce a $1 billion program to promote electric and other alternative vehicles through tax incentives for consumers and federal grants to states to finance infrastructure to support them.

The “National Community Deployment Challenge” includes incentives for individuals and businesses to buy “advanced cars and trucks” through a $10,000 tax credit – up from the $7,500 allowed under current tax law.

The plan also includes a “Race to the Top” contest that would award grants to states with “model communities” that invest in the infrastructure to support those vehicles, such as charging stations or natural gas corridors “where alternative fuel trucks can transport goods without using a drop of oil,” the White House Press Fact Sheet on the program states.

The North Carolina company, Daimler Trucks North America, is a partner in the Energy Department’s SuperTruck initiative, which wants to increase the fuel efficiency of long haul trucks, or 18-wheelers, by 50 percent by 2015, according to the White House.

“Here is the truth,” Obama said at the plant Wednesday. “If we are going to control our energy future, then we’ve got to have an all-of-the-above strategy.

“We’ve got to develop every source of American energy – not just oil and gas, but wind power and solar power, nuclear power, biofuels,” Obama said. “We need to invest in the technology that will help us use less oil in our cars and our trucks, in our buildings, in our factories.”

At the same hour that Obama was making his announcement in the swing state of North Carolina, the House Subcommittee on Energy and Power was holding a hearing on causes of the high gas prices facing U.S. consumers – up from under $2 when the president took office to almost $4 in most states today.

“This administration’s hostility toward domestic drilling has not changed, only his rhetoric has,” Rep. Fred Upton (R-Mich.), chairman of the House Committee on Energy and Commerce, said in a statement distributed at the hearing.

Upton said the president’s claim that oil production is up is because of increases on private and state lands and that “production has actually declined on federal lands from 2010 to 2011,” Upton said.

Jack Gerard, president and CEO of the American Petroleum Institute, said the administration claim of an “all-of-the-above” approach to energy policy does not seem to include oil and gas.

“The administration says it is for more oil and gas, but rejects the Keystone XL pipeline,” Gerard said. “It says it is boosting domestic production onshore, but new leasing on federal lands is down 44 percent, and the number of new wells drilled is down 39 percent.

“It says it is opening offshore areas but the latest plan keeps 87 percent of these areas off limits,” Gerard said. “It says oil and gas activity in the Gulf of Mexico is back to normal, but the latest forecast says production this year will be down nearly 21 percent from 2010.

“It says it is for natural gas, but 10 federal agencies are looking at new regulations that could needlessly restrict it,” Gerard said. “It calls for “all-of-the-above” then threatens the companies that could lead an energy renaissance with $85 billion in discriminatory tax increases,” Gerard said.

But Mike Breen, vice president of the Truman National Security Project, praised the president during his testimony to the subcommittee.

“Our dangerous dependence on oil empowers unfriendly regimes like Iran and allows them to dictate prices we pay at the pump,” Breen said in a preview of his statement distributed at the hearing.

“While there is no silver bullet to break oil’s grip on our national security, we do have silver buckshot in our arsenal: the enterprise and innovations to develop clean, domestic energy sources that will reduce our dependence on oil and ensure America’s national security,” he added.

“That is why I commend the White House for today’s proposal that they will allocate $1 billion for the development of a broad range of alternative fuels and vehicle technologies and the infrastructure need to deliver those alternatives to the consumer,” Breen said.

Obama’s $1 billion plan would require congressional approval to change tax law and to allocate money to the states through the “Race to the Top” grant competition.

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