WASHINGTON -- The Senate today rejected expanded tax breaks for producers of alternative fuels and new tax credits for owners of plug-in hybrid electric vehicles.
The benefits were part of a broader $29 billion tax package that Senate Democratic leaders wanted to attach to a comprehensive energy bill that has been the subject of heated debate and intense lobbying this week.
Still expected is a vote on tougher fuel economy standards. A compromise was said to be in the works late this afternoon.
Senate Democratic leaders needed 60 of 100 senators to vote for the tax package. The tally was 57-36 in favor. It could be revived later.
Democratic leaders kept the broader energy bill alive by a 61-32 vote.
Yet to come before the full Senate is a vote on fuel economy. Senate allies of the automobile industry are trying to win approval of a less severe alternative than the provision contained in the bill, which would raise standards for cars and light trucks by a combined 40 percent by 2020 and another 4 percent per year after that.
The tax package was rejected largely by Republicans who opposed higher taxes on oil companies.
The $700 million in tax credits for plug-in hybrids would have gone to people who convert existing gasoline-electric hybrids to plug-in capability, and to those who buy new plug-in hybrid vehicles, such as General Motors' planned Chevrolet Volt.
You may e-mail Harry Stoffer at [email protected]