■ Performance-based tax creditsCASE STUDY
In 2011, President Obama announced an agreement with 13 large automakers,
which account for 90% of all vehicles sold in the United States, to increase
the average fuel economy for cars from 37.8 miles per gallon (mpg) to 54.5
mpg and from 23.5 mpg to 28.8 mpg for light-duty trucks by model year- Under this agreement, passenger cars would be required to achieve 5%
annual improvements, and light-duty trucks would be required to achieve
3.5% annual improvements.
Types of Fuel
Many states and the federal government are working to increase the use of
alternative fuels, such as electricity, natural gas, hydrogen, and biofuels, to
diversify the fuels used in the transportation sector as well as to support greater
energy security, reduce greenhouse gas emissions, and provide price stability.
Methods that are used or that could be used to encourage the use of
environmentally friendly vehicles include:
■ Governments only buying vehicles that use alternative energy
■ Increasing taxes on traditional fossil fuels
■ Allowing cars that use alternative energy sources the right to travel in
HOV (High Occupancy Vehicle) lanes
■ Building more charging stations
■ Providing tax rebates for the purchase of alternative fuel vehicles
■ Providing subsidies to companies to develop vehicles capable of using
alternative fuels
■ Increasing CAFE standardsTypes of Vehicles