Senate OKs $1.6 billion to bolster fuel efficiency

Keith Laing
Detroit News Washington Bureau

Washington — The U.S. Senate voted Wednesday to reauthorize a $1.6 billion federal program that is intended bolster development of hybrid and electric vehicles. The approval came despite objections of conservative groups that have complained about past government loans to auto companies — including Fisker Automotive — that have gone bankrupt.

The reauthorization of the Department of Energy’s Vehicle Technologies program was included in a broad energy bill that was approved on an 85-12 vote. The program was last funded by Congress in 2007.

The Senate energy bill calls for spending about $339 million per year “to support domestic research, development, engineering, demonstration and commercial application and manufacturing of advanced vehicles, engines and components.” The new funding would be set to expire in 2020 under the legislation.

The measure will have to be merged now with a House energy bill sponsored by Rep. Fred Upton, R-St. Joseph, which was approved last December. Legislation containing the vehicle technology provisions have been introduced in the House by Rep. Debbie Dingell, D-Dearborn, but the lower chamber has not yet moved to include the program in its broad energy bill.

Backers of the vehicle technologies program are hoping the Senate’s large majority favoring the program will nudge the House to include the funding for fuel efficiency research.

They said the money that is included in the Senate’s energy bill would fund research that will help automakers improve fuel efficiency of cars ahead of forthcoming federal standards that will soon require an average fleet rate of 54.5 miles per-gallon.

“The cars and trucks of the future will be equipped with technology making them safer and more fuel efficient, and we must ensure that the United States leads the way in developing these innovations,” Sen. Gary Peters, D-Bloomfield Township, said in a statement. “These emerging technologies will not only help lower fuel costs for businesses and consumers, their development will help create jobs in Michigan and across the country.”

Sen. Debbie Stabenow, D-Lansing, added, “Our measure will help manufacturers and suppliers research and develop innovative technologies to make the next generation of fuel-efficient vehicles, spurring job growth and reducing our dependence on foreign oil.”

Critics have complained about previous loans that have been offered by the Energy Department to auto companies that have gone belly-up like Fisker.

“Five companies have been awarded DOE loans, including two that the agency discontinued,” the Heritage Foundation said in a blog post last fall about auto-related “poison pills” in the energy bill. “The program’s biggest black eye is Fisker Automotive, an electric vehicle company that received a $529 million loan in April 2010 but declared bankruptcy just three years later.”

The Fisker loans were offered through the energy department’s separate Advanced Technology Vehicles Manufacturing loan program, which is not related to the funding that was approved by the Senate on Wednesday. That program been overhauled since the problems that were experienced by Fisker and other companies that experienced financial trouble after receiving federal money.

The failure of Fisker became a rallying cry for Republicans who argued that the Obama administration was picking winners and losers in the auto industry during the federal government’s controversial bailout of General Motors and Chrysler. The GM and Chrysler bailouts started under the former President George W. Bush administration in late 2008, but they became closely associated with Obama when he ordered the firing of former GM CEO Rick Wagoner in 2009.

Jennifer Thomas, vice president of federal government affairs for the Alliance of Automobile Manufacturers, countered Wednesday that the new funding for vehicle technologies in the Senate’s energy bill “will help speed the proliferation of advanced technology and alternative fuel vehicles.

“Automakers and our suppliers remain focused on the introduction and deployment of these fuel-efficient vehicles as we strive to address our nation’s energy security and environmental concerns,” Thomas said in a statement. “The Vehicle Innovation Act will aid these ongoing efforts and support the research and design of the next generation of fuel-efficient vehicle technologies.”

Upton said after Wednesday’s Senate vote, “We’ve made significant progress toward modernizing and protecting our energy infrastructure, promoting innovation and energy efficiency while strengthening U.S. energy security and jobs. But more work needs to be done.

“Our newfound energy abundance has completely flipped the script, and it’s time our energy laws caught up to the 21st century.”

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Twitter: @Keith_Laing