Major Plug-In Hybrid Incentive Program Initiated By Austin, TX

Texas capital proposing to allocate $1 million to provide $1000 each to the first 1000 purchasers of plug-in hybrids.

Published: 06-Mar-2005

A top Texas utility executive is pushing an initiative to promote the use of plug-in hybrid cars and trucks as a means of decreasing the cost and environmental impact from both the transportation and electric power industries. If adopted by the Austin, TX city council, this executive plans to package his plan of tax incentives for other U.S. cities' consideration.

The program would promote the use of plug-in hybrids -- similar to hybrids on the market today like Toyota's Prius, but with the option of operating the vehicle purely on electricity -- through a combination of utility rebates, government fleet purchase orders, foundation grants and regulatory means. Plug-in hybrids, just as the Prius does, operate on an electric motor at low speeds and recharge the battery from heat generated while braking. However, the driver also may plug in the vehicle, allowing it to operate solely on the electric power from the battery.

The official, Roger Duncan, deputy general manager of Austin Energy, said at a background briefing in Washington, D.C., that the proposal is also a plan to promote renewable energy, such as wind, solar and biomass, so if adopted, emission credits would be given to utility companies for emissions reduced in the transportation sector in proportion to the incentives they receive and based on the source of fuel for the electrification of the vehicles.

According to Duncan, the city would allocate $1 million to provide $1000 each to the first 1000 purchasers of plug-in hybrids. Like today's hybrids, plug-in hybrids are expected to be at least $3,000 more than their conventional counterparts.

DaimlerChrysler is developing plug-in hybrid versions of its Sprinter van, which can achieve 20 miles on grid electricity alone. The van will have better acceleration than the conventional Sprinter and achieve up to a 40-percent reduction in fuel consumption. According to Duncan, DaimlerChrysler initially plans a 30-vehicle test program, with a 100-vehicle fleet demonstration to follow.

Duncan estimates a driver of a plug-in hybrid would get the equivalent of 56-cents per gallon of gasoline. Other benefits of the program would be increased revenues to municipal utilities, reduced emissions in the city, the increase of wind power during off-peak hours (for Austin specifically) and the potential use of the vehicles' batteries as storage devices to avoid building peaking facilities, Duncan said. The program would be especially successful in areas where the local government owns their electric utilities, such as Austin, according to Duncan.

Austin Mayor Will Wynn (D) plans on introducing the proposal to the city council on March 3. "Really, the true beauty of this system is the fact that vehicles charged by the electric system will run on alternative energy sources, such as West Texas wind, instead of Middle East oil," Wynn said in a statement.

A staffer from the mayor's office said the resolution is receiving broad support from the council members. Austin is known for its progressive policies in the largely conservative state. "We're definitely the blueberry in the tomato sauce," the staffer said.

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