Statement of the Natural Gas Vehicle Coalition, Arlington, Virginia

This testimony is presented on behalf of the Natural Gas Vehicle Coalition the national trade association dedicated to promoting new markets for natural gas vehicles. As the voice of the natural gas vehicle industry we are pleased to endorse H.R. 1864 the Clean Efficient Automobiles Resulting from Advanced Car Technologies, CLEAR ACT, of 2001.

It is vitally important to increase the use of non-petroleum alternative motor fuels and advanced vehicle technologies, such as hybrid and fuel cell vehicles. Now is the time to take action. Today, there are more alternative fuel vehicle models in operation and available than ever before. Despite recent unique events, domestic natural gas and other alternative motor fuels are readily available. And state and local governments across the country are adopting legislative incentives.

However, despite all this, consumers continue to be hesitant to buy these vehicles because of the additional costs involved and in the case of alternative fuel vehicles, the lack of a fueling infrastructure. Congress can help by providing incentives that will reduce incremental costs and that spur alternative fuel infrastructure development. Fortunately both of these can be addressed by the prompt enactment of the CLEAR ACT that was introduced earlier this year by a number of distinguished members of this Committee, including Congressmen Dave Camp, Jim Ramstad, and Jennifer Dunn, and in the U.S. Senate by Senator Orrin Hatch, Jay Rockefeller, Jim Jeffords, John Kerry and Olympia Snowe. In addition, President Bush’s National Energy Plan also endorses the concept of providing tax incentives to spur consumer acceptance of vehicles that reduce the use of foreign oil.

While we have made progress, much more has to be done at the national level if we are to significantly reduce this country’s reliance on imported oil, improve our air quality and develop a sustainable transportation future. A sustainable transportation future is important to this country for two very important reasons. First, alternative fuel and other advanced technology vehicles help reduce our dependence on foreign oil. The US imports significantly more petroleum today than it did in 1992 when the Energy Policy Act was enacted. The recent oil curtailment by OPEC members demonstrates the serious consequences of even small disruptions in world oil supply. In 2000 alone, US consumers are spent almost $56 billion more on motor fuels than they did in 1999 because of OPEC’s actions. Prices have remained high and the bill to American consumers and businesses for higher fuel prices will exceed the cost for last year. This is roughly 5 to 8 times as much revenue in one year as might be lost to the Treasury over the ten-year life of the CLEAR ACT. The only way to break free of our reliance on petroleum fuels is to increase the use of non-petroleum alternative fuels and improve the efficiency of gasoline and diesel vehicles.

The second way America benefits from increased use of alternative fuel, hybrid and fuel cell vehicles is the environment. Compared to comparable gasoline vehicles, alternative fuel, hybrid and fuel cell vehicles produce far less carbon monoxide, volatile organic compounds and nitrogen oxides. In addition, these vehicles produce significantly less greenhouse gases. For example, the Honda Civic GX, which is produced in Ohio, has the cleanest internal combustion engine in production today. A gasoline vehicle certified to just the minimum current federal standards emits nearly 194 times more pollution than the dedicated natural gas Honda Civic GX.

To ensure these energy security and environmental benefits, the CLEAR ACT breaks new ground in legislation that has the support of a major portion of the auto industry. The amount of the credit for hybrid and fuel cell vehicles is tied directly to their fuel efficiency. While there is a base level of credit for the technology, increases in the amount of the credit are based on how much improvement in fuel economy they provide.

For alternative fuel vehicles, there also is a base credit for vehicles that only can operate on alternative fuels. This credit can be increased if the vehicles meet the most stringent standards available for certification, standards that will not go into effect for many years to come. The performance-based approach of this legislation has earned it the support of many in the environmental community. We can think of no similar legislation that has the broad support the CLEAR ACT enjoys.

Today, automobile and engine manufacturers have available more makes and models of alternative fuel and hybrid vehicles than ever. Soon, we will see the fuel cell vehicles. But, we are not there yet. Demand for these vehicles must increase further if manufacturers are to benefit from the economies of scale that come from mass production. To give you just one example, Ford Motor Company manufactured over 100,000 Crown Victoria sedans last year. Of that total, only 1,000 were dedicated natural gas Crown Victorias. If production of natural gas or other alternative fuel models can reach critical mass, their cost will come down dramatically and that’s why HR 1864 needs Congressional action this year.

The Natural Gas Vehicle Coalition is committed to working with the Committee and provides its most enthusiastic support. We urge the Committee to give favorable consideration to the CLEAR ACT and hope that there is an opportunity to move this legislation this year.