WASHINGTON -- Automakers will keep building cars and trucks capable of using alternative fuels even though the Bush administration is killing an ambitious, decade-old program to expand markets for vehicles that don't burn gasoline.
A big reason: Flexible fuel vehicles, such as those that can burn gasoline or E85, which is 85 percent ethanol and 15 percent gasoline, earn fuel economy credits for the automakers - even if owners buy only gasoline. The credits help companies comply with corporate average fuel economy standards, or CAFE.
For example, a flexible fuel 2001 Dodge Caravan with a 3.3-liter V-6 was credited as a 38.8-mpg truck for CAFE. The gasoline-only version was rated at 23.5 mpg, federal sources say.
In any case, the administration has quietly decided it won't force local government and private fleets to buy alternative fuel vehicles. The Department of Energy concluded such a mandate would do little to reduce gasoline use. A requirement that federal and state government fleets acquire alternative fuel vehicles stays in effect.
The decision against expanding the mandate is an official acknowledgment of real-world reality: A lofty goal set in 1992 to have alternative fuels replace 30 percent of U.S. gasoline consumption by 2010 isn't going to happen. And so, another government effort to wean the nation from its reliance on imported oil is in tatters.
While automakers still have their own, arguably selfish reasons to build flexible fuel vehicles, the department's action is a blow to prospects for vehicles that are designed to burn only an alternative, such as natural gas, propane or an alcohol-derived fuel, such as ethanol or methanol.
One early study for the department said that if it forced many local government and private fleets to acquire alternative fuel vehicles, sales of such cars and trucks would reach 320,000 each year. The existing mandate for federal and state government fleets yields sales of about 25,000 a year.
Now the department is saying the estimate for the expanded mandate was far too high. For that and other reasons, the department has concluded that almost nothing would be gained from pushing more fleets to acquire alternative fuel vehicles.
Its finding was published in a legal notice March 4. It is expected to become final within months.
"This defies logic, given the current world events and environmental problems," says Russell Long, executive director of the Bluewater Network, a San Francisco environmental group that tried to compel the department to expand the alternative fuel mandate to local government and private fleets.
The network and two other environmental groups won a federal court ruling over the issue last year.
Judges said the groups' arguments were correct: The 1992 law requiring federal and state fleets to use alternative fuel vehicles also contained deadlines for the department to rule on expanding the mandate to certain local government and private fleets.
The department missed those deadlines, so some kind of action had to be taken soon, the judges said.
The environmental groups did not even consider that the department decision could be to drop any requirement for adding alternative-fuel vehicles to local government and private fleets, Long says.
Even an association of fleet administrators, which opposed an alternative-fuel mandate, calls the department finding "an unexpected surprise."
Automakers frequently tout their development of alternative-fuel vehicles as one of the good things they do for the environment, but as a group they have not yet focused on the department finding, says Mike Stanton, vice president of the Alliance of Automobile Manufacturers.
Ford Motor Co., which calls itself the leader with more than a million alternative fuel vehicles sold, will not change its product plans because of the decision, says company spokes-man Mike Moran.
Ford has dropped a flexible fuel Ford Ranger but added a natural gas E-450 chassis for small buses, and it continues to build flexible fuel Explorers and Tauruses, among other models, Moran says.
General Motors did not favor an expanded government mandate because it could have been a burden for some fleet operators, who are GM's customers, says GM spokesman Mike Morrissey.
But the company remains committed to alternative fuels, especially E85 for flexible fuel vehicles, and has launched an effort to get more of them to use E85, Morrissey adds.
Patrick O'Connor, a lawyer who lobbied for the National Association of Fleet Administrators, agrees an expanded mandate was a bad idea.
Alternative-fuel vehicles are more costly than gasoline-powered versions, and alternative fuels aren't available everywhere, he says.
Plus, some fleets can't get alternative-fuel vehicles configured the way they need them; that is, outfitted to haul special tools or equipment.
The department decision to drop the expanded mandate contained an unusually candid government acknowledgment that flexible fuel vehicles, in the real world, are unlikely to burn anything except gasoline.
And yet, the National Highway Traffic Safety Administration continues to give extra fuel economy credits to automakers for producing flexible fuel vehicles, even if they never use an alternative fuel.
Environmental groups have criticized flexible fuel vehicles for having a net negative effect on the environment.
Not only do they distort the CAFE program, but they also obscure the amount of pollution being created, the groups say.
The American Council for an Energy-Efficient Economy, a nonprofit research group that rates the environmental impact of new cars and trucks, says flexible fuel vehicles "may be cleaner when running on their alternative fuel, but in practice this rarely happens." Many "drivers do not even know of the vehicles' alternative-fuel capabilities," the council reports.
Other department reasons for dropping an expanded fleet mandate are:
n More government tax credits would be a better way to promote alternative-fuel vehicles as well as cars and trucks with fuel-saving technology, such as hybrid powertrains.
n The administration's programs supporting development of hydrogen fuel and fuel cell vehicles are more promising in the long run.
n Congress included too many exemptions to the planned mandate for local government and private fleets for it to have been effective.