$25 BIL FOR FUTURE’S CARS

$25 Billion to Promote Electric Cars Is Untouched
Leslie Wayne, February 26, 2009 (NY Times)

"…The Energy Department has $25 billion to make loans to hasten the arrival of the next generation of automotive technology — electric-powered cars. But no money has been allocated so far, even though the Advanced Technology Vehicles Manufacturing Loan program, established in 2007, has received applications from 75 companies, including start-ups as well as the three Detroit automakers.

"With General Motors and Chrysler making repeat visits to Washington to ask for bailout money to stave off insolvency, some members of Congress are starting to ask why the Energy Department money is not flowing yet. The loans also are intended to help fulfill President Obama’s campaign promise of putting one million electric cars on American roads by 2015…"

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"Energy Department staff members said they were still sifting through loan applications, dozens of which arrived on the filing deadline of Dec. 31. On top of that, another $2 billion is coming to the department from the $787 billion stimulus package. That money will be used to develop the advanced battery technology needed to power electric cars, batteries more durable, safer and cheaper than anything available today.

"Until now, the program has gotten caught in the shifting priorities of two administrations. The program was not funded until September 2008. Then, the Bush administration considered using the Energy Department fund to help bail out G.M. and Chrysler, an idea that was later rejected. After that, President Obama had to name a new cabinet. As soon as Steven Chu took office as energy secretary, some members of Congress started applying pressure…"

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"There are complicating factors. Money can be given only to companies and projects that are deemed “financially viable.” G.M. and Chrysler, which have applied for a combined $13 billion from the Energy Department, must wait until the end of March for the Obama administration to decide whether the companies’ restructuring plans would make them viable…

"The program’s small staff — around a dozen part- and full-time employees — must also sort through complicated proposals, up to 1,000 pages long. Many of the applicants have lined up members of Congress to pressure the department…smaller companies say they fear the bulk of the money will be directed to the Detroit automakers…Still, with credit markets tight, the program represents a rare source of financing to develop electric-vehicle technology…

"The Energy Department has whittled the initial 75 loan applications, which seek a total $38 billion, down to 25 for a second round of reviews…"