WASHINGTON – U. S. Senator Ben Cardin (D-MD) today joined U.S. Senators Roy Blunt (R-MO) and Debbie Stabenow (D-MI) in introducing a bipartisan bill to encourage greater use of propane as an alternative transportation fuel, especially for large fleets of trucks and buses. Propane is a reliable, domestically produced fuel with lower greenhouse gas emissions than gasoline. Additionally, propane supply is expected to increase over the next several decades, which would result in increased price stability.
The Propane Green Autogas Solution Act, S. 1120, would extend for five years Federal Alternative Fuel Tax Credits for propane used as a motor fuel, propane vehicles, and propane refueling infrastructure. In 2005, legislation established significant tax incentives for propane (known as propane autogas) to promote its use in motor vehicles, reduce U.S. dependence on foreign oil, and reduce damage to the environment associated with gasoline and diesel use.
“Our nation must move to a more sustainable energy policy that lessens our dependence on foreign energy sources,” said Senator Cardin, a member of Senate Finance Committee and the Senate Environment & Public Works Committee. “It is in our national interest – and national security — to encourage alternative energy sources, including propane, as a way to move our economy forward and protect our environment. Propane is readily available and helps provide an alternative to imported oil.”
“During a time when families and job creators in Missouri and across America are struggling to make ends meet, it’s critical that we continue to support domestic energy alternatives. Propane is a clean and reliable fuel, and this bill will provide consumers with greater access to this domestically-produced alternative,” said Senator Blunt.
“Michigan is the largest propane consuming state in the nation,” said Senator Stabenow. “At a time when so many families are struggling with high gas prices and other economic challenges, we must do everything we can to expand alternative vehicle choices. This legislation helps promote propane vehicles as one of those options.”
In 2005, highway reauthorization and energy bills provided the following alternative fuel tax credits that benefit propane autogas, all of which would be extended under the legislation being proposed:
- Propane Fuel Credits – SAFETEA-LU included a 50 cent per gallon credit for propane sold for use in motor vehicles. This credit expires at the end of 2011.
- Propane Vehicle Credits – EPACT 2005 included a tax credit to consumers who purchase ‘OEM” (original equipment manufacturer) propane vehicles or convert gasoline or diesel engines to propane. The amount of credit the consumer receives varies depending on vehicle weight and emissions. This credit is currently expired.
- Propane Infrastructure Credits – EPACT 2005 provided a tax credit amounting to 30 percent of the cost of a fueling station, not to exceed $30,000 per station. This credit expires at the end of 2011.
Propane autogas is a reliable, domestically produced alternative fuel with lower greenhouse gas (GHG) emissions than gasoline. Sixty percent of propane, also known as liquefied petroleum gas (LPG), is derived from natural gas processing and 40 percent is a byproduct of crude oil refining. The bill would offer the long-term policy commitment necessary to continue building an alternative fuel infrastructure and bolster a burgeoning autogas market.