From AAIA Capital Report

WASHINGTON, D.C. – The promotion of alternative-fueled vehicles continues to garner significant attention during the 112th Congress. Bills were introduced last week on both sides of the Capitol to increase the production of cars powered by electricity and ethanol.

Sens. Tom Harkin (D-Iowa), and Richard Lugar (R-Ind.), sponsored a bill (S. 187) that would require 90 percent of the vehicles for sale in 2016 to be flex-fuel vehicles capable of running on higher ethanol blends. Recently, EPA has granted waivers that would permit 2001-2006 vehicles to use 15 percent ethanol (E15), and last year the agency granted a waiver for E15 for 2007 and later vehicles. Prior to the waiver decision, ethanol was limited to 10 percent of gasoline. S. 187 also would require major fuel distributors to install at least one blender pump capable of dispensing higher ethanol blends at 50 percent of gas stations nationwide by 2020.

In addition, Sen. Carl Levin (D-Mich.), and his brother Rep. Sander Levin (D-Mich.), introduced bills aimed at doubling the number of vehicles per manufacturer eligible for a $7,500 tax credit for plug-in hybrid and electric vehicles. Currently, the tax credit is phased out over six quarters after a car company sells 200,000 vehicles, but the new bill introduced by the Levin brothers would raise the cap to 500,000 vehicles. The tax credit is intended to reduce the cost of plug-in hybrids, which currently retail at the low $30,000 range.

President Obama, in his State of the Union Address, called for the U.S. to have more than one million electric vehicles on the road in five years.