Support Parity for Natural Gas and Propane Vehicle Programs in the Clean Energy Jobs and Oil Company Accountability Act of 2010

On July 28, 2010, Senate Majority Leader Harry Reid (D-NV) introduced the Clean Energy Jobs and Oil Company Accountability Act of 2010 (S. 3663).  Included in the bill are financial incentives that offset the manufacture, purchase, and refueling infrastructure costs of natural gas vehicles at the expense of propane alternatives. The propane industry believes there is no credible policy reason to provide incentives to our competitors in the natural gas industry and not apply the same incentives to propane.  Any final energy bill should include a more equitable approach to incentivizing alternative fuels and alternative fuel vehicle use, an approach that places natural gas and propane vehicle incentive programs on equal footing.

• Propane is an American fuel.  90% of supply is produced domestically. Another 7% percent comes from Canadian imports, the remainder from other international sources. 

• The propane vehicle target market is commercial fleets – high mileage, low miles per gallon – where the impact on reducing imported fuel is large.

• Propane and natural gas vehicles are virtually the same in terms of greenhouse gas (CO2) emissions.

• Similar to natural gas, propane supply is expected to increase over the next several decades, guaranteeing consumer availability and price stability.

• Federal incentives for propane vehicles and infrastructure will provide an immediate return on taxpayer investment. 
  • Propane vehicles are available now for commercial fleet use.  Recognizing a market, both Ford and GM are producing propane platforms. 
  • Propane storage infrastructure is already in-place nationwide. For $15,000 propane refueling facilities can be quickly and easily installed. Similar natural gas refueling stations are more difficult to construct and can cost over $400,000 per site.

• If the federal government incentivizes only natural gas vehicles, the government will be giving a financial handout to huge natural gas entities at the expense of small propane retailers. (Propane marketers are 90% small businesses).
  

• Congress should abide by the principle of fuel neutrality and should not be in the business of picking winners and losers for consumers in their choice of alternative fuels and vehicles. 
  

• There is no policy reason to provide federal incentives to our competitors in the natural gas vehicle industry and not apply those same incentives to the propane.