Thursday, November 06, 2008

DOE Issues Advanced Tech Vehicle Incentive Rule

Nov 5: U.S. Department of Energy (DOE) issued an Interim Final Rule that implements the Advanced Technology Vehicles Manufacturing Incentive Program authorized by section 136 of the Energy Independence and Security Act of 2007 (EISA). The FY09 Continuing Resolution provided DOE with funding to make up to $25 billion in direct loans to eligible applicants for the costs of reequipping, expanding, and establishing manufacturing facilities in the United States to produce advanced technology vehicles, and components for such vehicles. The vehicles must provide "meaningful improvements" in fuel economy performance. In the FY09 Continuing Resolution, Congress required DOE to issue to issue interim final regulations for the section 136 program within 60 days -- that is, by November 29.

DOE Secretary Samuel Bodman said, "Issuance of this interim final rule opens the process for automakers and component manufacturers to immediately apply for government funding under the Advanced Technology Vehicles Manufacturing Incentive Program. Since Congress provided funding for this loan program approximately 30 days ago, the Department has worked quickly and responsibly to draft this rule, set up a loan office, and establish a credit review board to review loan applications."

Congress has appropriated $7.5 billion to cover the subsidy costs of direct loans issued to automobile manufacturers and component suppliers under EISA section 136. The actual amount of loans that DOE will be able to issue with this funding, up to the statutory ceiling of $25 billion in loans, will depend on the particular circumstances of specific borrowers and proposed projects. Additionally, the Department must comply with statutory requirements including the National Environmental Policy Act (NEPA) in connection with the issuance of any loans to be made under the EISA section 136 program. The Department said it intends to act quickly to review and evaluate any applications it receives from eligible applicants under the section 136 program.

Under the Interim Final Rule procedure, the rule becomes effective immediately upon publication in the Federal Register; however, comments will be received for 30 days. A final rule will be issued at a later date. Under the proposal the first set of applications for loans must be submitted by December 31, 2008.

Access a release from DOE (click here). Access a prepublication copy of the rule (click here). Access the Advanced Technology Vehicles Manufacturing Loan Program (click here). Access a fact sheet on the loan program (click here). [*Energy, *Air, *Climate]