US Senators John Kerry ( Massachusetts) and Joe Lieberman (Connecticut) have introduced a new legislation providing an economic boost to natural gas vehicles. The two senators included provisions in their proposed climate change legislation, the American Power Act, that would support the production and purchase of natural gas vehicles.

Among the natural gas vehicle-related provisions, the proposed legislation would establish new tax credit caps for fleet vehicles. Currently, there are incentives for the purchase of natural gas vehicles put in place by the Energy Policy Act of 2005.

The potential value of the tax credit would vary depending on the size of the vehicle, the incremental cost of the vehicle and the emissions performance of the vehicle.

Light-Duty vehicle (under 8,501 lbs), which enjoys credit cap of $5000, will be eligible for a $10,000 credit cap, Medium-Duty (8,501-14,000 lbs) falling under $10,000 credit cap will be able able to avail $20,000.

Fleet owners would be eligible for a tax credit of 50%-to-80% of the cap depending on emissions performance. Bi-fuel vehicles would now also be eligible for the tax credit. The incentives would be available for 10 years.

In addition to the extension and expansion of the vehicle purchase incentive, the legislation also would create ‘natural gas bonds’, which would help stimulate the use of natural gas vehicles by government bodies, and a tax incentive program for vehicle manufacturers, which would make manufacturing of natural gas vehicles cost effective.

Richard Kolodziej, president of NGVAmerica, said: ”Natural gas is the cleanest burning alternative transportation fuel commercially available today and can reduce greenhouse gases emissions by almost 30%.

”The US is behind many other countries in using natural gas as a transportation fuel, and the provisions in this legislation will encourage more fleets to switch to clean burning, domestically produced natural gas.”