Lawmakers eye more tax breaks for natural gas cars
By KEN THOMAS – 1 hour ago

WASHINGTON (AP) — Hoping to spur alternative vehicles, lawmakers want to double the size of tax breaks for buying cars that run on natural gas.

Senators joined Texas oilman T. Boone Pickens on Wednesday to propose legislation that would increase tax credits for natural gas that were created by a 2005 energy law. About 10 million vehicles globally run on natural gas, but only a small fraction of those are in the United States.

"Natural gas vehicle technology is here, and all that's needed is the policies to jump-start the industry to make it flourish," said Sen. Robert Menendez, D-N.J., who introduced the legislation with Sen. Orrin Hatch, R-Utah. Senate Majority Leader Harry Reid, D-Nev., also supports the plan.

Pickens has spent the past year pushing his "Pickens Plan," which includes more investment in wind and solar energy, rebuilding of the nation's electrical grid and replacing gasoline with natural gas in cars and trucks. He said the incentives would help reduce the nation's dependence on foreign oil.

"We have to get on our own resources," Pickens said.

The tax credits, which can be used to provide 80 percent of the added cost to buy a natural gas-fueled car instead of a typical vehicle, would increase to $12,500 for passenger cars and light trucks under legislation unveiled Wednesday. The tax credits currently stand at $5,000 and are set to expire in 2010.

The bill includes more generous incentives for larger vehicles, typically used in government fleets. It also extends several natural gas tax credits for 10 years and encourages government fleets to add more alternative vehicles.


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