The National Highway Traffic Safety Administration (NHTSA) on March 6, 2002 released a proposal on the implementation of the Alternative Motor Fuels Act of 1988 (AMFA), which encourages the development and use of methanol, ethanol and natural gas, and promotes the production of alternative fuel vehicles. NHTSA also proposed extending the program through Model Year 2008. AMFA provides special procedures for calculating the fuel economy of “dual-fueled” vehicles for Corporate Average Fuel Economy (CAFE) compliance purposes, which substantially increase the calculated fuel economy values for these vehicles, providing a production incen-tive for manufacturers. The Act directed NHTSA (in consultation with the U.S. Environmental Protection Agency (EPA) and Department of Energy (DOE) to evaluate the dual-fueled vehicle incentive program and provide a report to Congress with a preliminary conclusion on whether to extend the program beyond the 2004 model year. The report states that it would be prudent for federal agencies, Congress, industry, and other interested stakeholders to identify additional programs and authorities that could contribute to expanding the infrastructure and achieving greater use of alternative fuels in dual-fuel vehicles that receive the CAFE credit. In a second action, NHTSA issued a Notice of Proposed Rulemaking (NPRM) proposing to extend the availability of the CAFE credit incentive for dual-fueled vehicles for four years, through the end of the 2008 model year. NHTSA gave these reasons for its proposed four-year extension of the CAFE credit incentive: The vehicles affected by the program can operate on a blend of 85 percent ethanol, a domestic fuel, whose increased use can decrease our reliance on foreign petroleum. It would give Congress, other executive branch agencies, regional authorities, and the private sector ample time to identify, adopt and implement efforts to enhance the alternative fuel infrastructure. Energy benefits will only be realized through the extension of the incentive policy if other incentives, programs, or market conditions stimulate the production, distribution, and use of alternative fuels over the next four years. Comments on the NPRM will be accepted for 60 days from the date of publication in the Federal Register. Submit comments in writing to: Docket Management, Room PL-401, 400 Seventh Street, S.W., Washington, DC, 20590. Alternatively, submit comments electronically by log-ging onto the Docket Management System website at Click on "Help & Information" or "Help/Info" to view instructions for filing. Regardless of the method used, those who comment should mention Docket No. NHTSA-2001-10774, Notice 2.

Originally posted on Fleet Financials