WASHINGTON -- Consumers who buy vehicles powered by gasoline-electric hybrid systems, advanced diesel engines or other advanced technologies would be eligible for federal tax credits under a plan approved by congressional negotiators.
The proposal would cost the U.S. Treasury an estimated $900 million over 10 years. It is part of a massive energy bill that Congress hopes to send to President Bush by week's end.
The Clinton administration first proposed tax credits for advanced-technology vehicles in 1998, as a way to reduce greenhouse gas emissions.
Automakers adopted the idea as a policy alternative to higher fuel economy standards. The industry says consumer incentives are needed to help build production volumes and cut the cost of manufacturing vehicles with fuel-saving powertrains.
Divisions among automakers over how to tailor the credit program and battles among lawmakers on a variety of energy issues have stalled the plan.
But the latest energy bill skirts some of the most divisive issues -- such as drilling for oil in the Arctic National Wildlife Refuge -- and is expected to become law.
The size of each tax credit would vary by vehicle weight class and the amount of improvement in fuel economy, a summary of the measure indicates.
The provision is "radically pared down" from what is needed to promote fuel-saving vehicles adequately, the Union of Concerned Scientists said in a statement.
The environmental group says the bill does more harm than good and should be rejected. That appears unlikely.
If it becomes law, the tax credit provision is expected to aid in the sale of hundreds of thousands of vehicles. After an automaker sells its 60,000th credit-eligible hybrid and/or diesel vehicle, credits for customers of that company would begin to phase down, rather than end immediately.
The Big 3 lobbied for that provision to keep tax benefits from going entirely to customers of import-brand automakers, which have been ahead in developing hybrid vehicles.
Otherwise, the proposed energy bill is noteworthy for what it does not do to automakers. For example, it does not require any increase in fuel economy standards.
It also extends a fuel economy credit that automakers get for building vehicles that are capable of burning ethanol or gasoline -- even if they never use ethanol.
House Energy and Commerce Committee Chairman Joe Barton, R-Texas, maintained that the energy measure would slow the increase in the nation's dependence on imported oil.
"It's a darned good bill," Barton said. "It's going to help this country."
You may e-mail Harry Stoffer at