The money to fund an extended Cash for Clunkers program could come at the expense of renewable energy companies.
The House on Friday overwhelmingly passed a bill to extend the program which gives consumers up to $4,500 for trading in old cars for new, fuel-efficient ones with an additional $2 billion. The initial $1 billion set aside is said to be already or nearly exhausted.
The program has been popular with consumers as well as politicians who see it as a way to revive bleak auto sales. However, the House proposed paying for the extension by using $2 billion approved in the stimulus package for loan guarantees for renewable energy, which may not sit well with energy project developers.
Altogether $6 billion was provided for Department of Energy loan guarantees. Those loan guarantees would be made available to finance construction of large solar or biofuels projects. Project financing has become particularly difficult because of the credit crunch.
The Renewable Fuels Association, the main lobbying organization for the ethanol industry, put out a statement on Friday to indicate it is "concerned to see the program paid for by depleting the renewable energy loan guarantee program."
Senate Energy Committee chairman Jeff Bingaman said on Friday that he opposed using the Department of Energy's loan guarantee program to fund the Cash for Clunkers program. The Senate is expected to take up the measure next week.
"If Congress decides to extend this initiative, I believe we must not rob from the loan guarantees we provided through the recovery package that, in the long term, will shift our country to home-grown, renewable energy while creating good 'green collar' jobs," Bingaman said, according to a Reuters report.
Speaking on the House floor, Speaker Nancy Pelosi also voiced her concern and said that she hoped those renewable energy loan guarantee funds would be restored.
At a press conference, President Obama on Friday said that the he expects Congress and the White House to work to return funding the loan guarantee program "down the road."
"Bright Automotive's plug-in hybrid IDEA will be revealed on Capitol Hill on April 21."
(Credit: Bright Automotive)Bright Automotive announced an earlier-than-anticipated reveal date for its plug-in hybrid vehicle, IDEA.
The Indiana-based automotive company will unveil the prototype light-duty vehicle, which includes pickup trucks, SUVs, and sedans, on Capitol Hill in Washington, DC, on April 21 instead of at the Norway's Electric Vehicle Symposium in May.
No explanation for this change was given, but the press release states, "Members of Congress and companies involved with Bright Automotive will take part in a briefing on the IDEA and a public event."
Little is known about the IDEA, but the start-up's CEO, John Waters, hinted that the first production PHEV vehicle from Bright Automotive may not be a passenger sedan.
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One of 22 modules that make up the 16-kWh, 330-volt lithium ion battery pack for the Mitsubishi iMiev. The module contains four battery cells.
(Credit: Mitsubishi Motors)"Should Uncle Sam provide billions in loans and grants to a promising but unproven business? Or should the government wait for the market to sort things out before it backs a U.S. company?"
Those are questions posed in a BusinessWeek article last week. However, the questions are largely rhetorical: the U.S. Department of Energy already has a $25 billion Advanced Technology Vehicles Manufacturing Loan Program, and many car and battery companies are counting on these loans to aid their development and production of lithium ion batteries.
So it's not a question of "should," it's a question of "how?"
Lithium ion batteries will add at least $8,000 to the price of a production plug-in hybrid vehicle, according to BusinessWeek. However, that amount is probably on the low side when you consider that the Chevy Volt is predicted to cost a bit less than $40,000, a good portion of that price being the battery. Another manufacturer representative estimated that a lithium ion battery currently costs approximately $22,000, effectively putting the electric car out of reach to all but the well-heeled greenies.
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