The Car and Truck Fleet and Leasing Management Magazine

“Dual-Fuel” Incentives Suit Dismissed

August 23, 2005

WASHINGTON, D.C. — One side-effect of the energy bill President Bush signed into law on Aug. 15 is that incentives to automakers to produce “dual-fuel” vehicles will last for at least 10 years, according to the Detroit News. This kills a lawsuit that threatened to bring the program to an end. Dual-fuel cars and trucks can run on either gasoline or another fuel, usually ethanol. The vehicles were intended to provide consumers with a backup in case they can’t find alternative fuel. Environmental groups have been highly critical of the program because consumers almost always use gasoline due to the lack of availability of other fuels. Often, consumers didn’t even know of the capability, however, automakers earned credits they could use to comply with the Corporate Average Fuel Economy (CAFÉ) program, which mandates minimum fuel economy averages for their car and light truck lineups. In a lawsuit filed last year, Public Citizen, the Natural Resources Defense Council, and the Center for Auto Safety argued that the dual-fuel loophole has increased oil consumption, by allowing major automakers to underwrite more sales of less fuel-efficient vehicles with the CAFE credits they earn. A 2002 report to Congress by the Department of Transportation concluded that the Alternative Motor Fuels Act of 1988 had succeeded in motivating automakers into producing ever greater number of flexible fuel vehicles. But, due to the lack of filling stations providing alternative fuels, flexible-fuel vehicles are powered by gasoline more than 99 percent of the time. With the signing of the energy bill, the dual-fuel program is set to operate for another 10 years, and the lawsuit challenging the program was then dismissed.
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