The $787billion stimulus bill has provided a boost for a number of transportation-related projects in America, with plug-in hybrid vehicles among the technology most likely to benefit.

Under existing laws, a credit is available for each new qualified fuel cell vehicle, as well as hybrids, advanced lean burn technology vehicles and alternative fuel vehicles. The credit amount varies based on technology, efficiency and other factors for vehicles purchased after 2005.

The base amount for a plug-in electric drive motor vehicle is $2,500 with an additional $417 for each kWh of battery capacity up to a maximum of $7,500 for vehicles weighing 10,000lbs or less; $10,000 for vehicles weighing between 10,000lbs and 14,000lbs; and $12,500 for vehicles that weigh more than 14,000lbs but not more than 26,000lbs.

Under the House Bill, there were no provisions to modify this credit but the Senate version has made several changes expanding the vehicles that qualify and adding a credit for plug-in hybrid electric vehicle conversions. The 250,000 vehicle limitation has also been doubled to 500,000.

The conference agreement made several changes to the Senate version. Here are the provisions outlined:

  • – A credit up to $2,500 is available for electric drive low-speed vehicles, three-wheeled vehicles and motorcycles.
  • – A credit of 10 per cent, up to a maximum of $4,000 to be introduced for the cost of converting a vehicle into a PHEV. The minimum capacity is 4kWh and conversions made after December 31, 2011 will not qualify.
  • – The maximum credit has been limited to $7,500 regardless of a vehicle’s weight. The credit for low-speed plug-in vehicles weighing 14,000lbs or more has been eliminated.
  • – The 250,000 plug-in vehicle limitation has been replaced with a 200,000 plug-in vehicle per manufacturer limitation.
  • – Changes to the credit will be applied for vehicles that are acquired after December 31, 2009.
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