Key Federal Legislation

The information below includes a brief chronology and summaries of key federal legislation related to alternative fuels and vehicles, air quality, fuel efficiency, and other transportation topics.

Chronology of Federal Legislation

Alternative fuel and fuel economy legislation dates back to the Clean Air Act of 1970, which created initiatives to reduce mobile sources of pollutants. In 1975, the Energy Policy and Conservation Act established Corporate Average Fuel Economy (CAFE) standards and required the distribution of fuel economy information to consumers. To incentivize alternative fuel vehicle development, the Alternative Motor Fuels Act of 1988 established vehicle manufacturer incentives in the form of CAFE credits

The Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA) laid the foundation for highway construction and safety programs. Subsequent Surface Transportation Acts include the Transportation Equity Act for the 21st Century (TEA-21) of 1998, and the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU), enacted in 2005, and the Moving Ahead for Progress in the 21st Century (MAP-21) Act, enacted in 2012. Each of these acts authorizes funds for highway construction, highway safety, and public transportation programs. Recent surface transportation acts also include provisions related to alternative fuel vehicles (AFVs) and infrastructure.

The Energy Policy Act of 1992 established regulations requiring certain federal, state, and alternative fuel provider fleets to build an inventory of AFVs. It was amended several times in the Energy Conservation and Reauthorization Act of 1998 and in 2005 via the Energy Policy Act in 2005, which emphasized alternative fuel use and infrastructure development.

The Energy Independence and Security Act of 2007 included provisions to increase the supply of renewable fuel sources and raise CAFE standards to 35 miles per gallon by 2020. The Emergency Economic Stabilization Act authorized the Energy Improvement and Extension Act of 2008, which provided several provisions related to tax credits and exemptions for alternative fuels and fuel-efficient technologies.

The American Recovery and Reinvestment Act of 2009 appropriated nearly $800 billion towards the creation of jobs, economic growth, tax relief, improvements in education and healthcare, infrastructure modernization, and investments in energy independence and renewable energy technologies. The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 and the American Taxpayer Relief Act of 2012 extended and reinstated a number of alternative fuel tax credits. This section summarizes these laws.

Legislation Summaries

Below are summaries of selected sections of federal legislation related to alternative fuels and advanced transportation technologies.

American Taxpayer Relief Act of 2012

Enacted January 2, 2013
American Taxpayer Relief Act of 2012 (Public Law 112-240) extends and reinstates several alternative fuel incentives. The law reinstates, effective through December 31, 2013, the alternative fuel infrastructure tax credit, biodiesel income tax credit, biodiesel mixture excise tax credit, and alternative fuel mixture excise tax credits and incorporates a tax credit for two- and three-wheeled plug-in electric vehicles through December 31, 2013. It also extends until December 31, 2013, the second generation biofuel producer tax credit and second generation biofuel plant depreciation deduction allowance. In addition, it extends discretionary funding for the U.S. Department of Agriculture's Advanced Biofuel Production Grants and Loan Guarantees, Advanced Biofuel Production Payments, Biodiesel Education Grants, Biomass Research and Development Initiative, and Ethanol Infrastructure Grants and Loan Guarantees.

Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010

Enacted December 17, 2011
Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (Public Law 111-312) extends and reinstates several alternative fuel tax credits. The law extends until December 31, 2011, the qualified alternative fuel vehicle fueling property tax credit, the volumetric ethanol excise tax credit (VEETC), and the ethanol and biodiesel producer tax credits. It also reinstates, effective January 1, 2011, through December 31, 2011, the alternative fuel and alternative fuel mixture excise tax credits, as well as the biodiesel mixture excise tax credit.

American Recovery and Reinvestment Act of 2009

Enacted February 17, 2009
The American Recovery and Reinvestment Act (ARRA) of 2009 (Public Law 111-5) appropriates nearly $800 billion towards the creation of jobs, economic growth, tax relief, improvements in education and healthcare, infrastructure modernization, and investments in energy independence and renewable energy technologies. ARRA supports a variety of alternative fuel and advanced vehicle technologies through grant programs, tax credits, research and development, fleet funding, and other measures. For a summary of the provisions related to alternative fuels and vehicles, air quality, fuel efficiency, and other transportation topics, see the ARRA summary table.

Energy Improvement and Extension Act of 2008

Enacted October 3, 2008
The Energy Improvement and Extension Act of 2008 is Division B of the Emergency Economic Stabilization Act (Public Law 110-343). Title II of Division B of the law includes several provisions related to tax credits and exemptions for alternative fuels and fuel-efficient technologies. For a summary of the relevant provisions, see the Energy Improvement and Extension Act of 2008 summary table.

Energy Independence and Security Act of 2007

Enacted December 19, 2007
The Energy Independence and Security Act (EISA) of 2007 (Public Law 110-140) aims to improve vehicle fuel economy and reduce U.S. dependence on petroleum. EISA includes provisions to increase the supply of renewable alternative fuel sources by setting a mandatory Renewable Fuel Standard, which requires transportation fuel sold in the United States to contain a minimum of 36 billion gallons of renewable fuels annually by 2022. In addition, the law sets the Corporate Average Fuel Economy (CAFE) standard at 35 miles per gallon for passenger cars and light trucks by the year 2020. EISA also includes grant programs to encourage the development of cellulosic biofuels, plug-in hybrid electric vehicles, and other emerging electric technologies. The law is projected to reduce greenhouse gas emissions by 9% by 2030. For a summary of the provisions related to alternative fuels and vehicles, air quality, fuel efficiency, and other transportation topics, see the EISA summary table.

Energy Policy Act of 2005

Enacted August 8, 2005
The Energy Policy Act (EPAct) of 2005 (Public Law 109-58) calls for the development of grant programs, demonstration and testing initiatives, and tax incentives that promote alternative fuels and advanced vehicles production and use. EPAct 2005 also amends existing regulations, including fuel economy testing procedures and EPAct 1992 requirements for federal, state, and alternative fuel provider fleets. For a summary of the provisions related to alternative fuels and vehicles, air quality, fuel efficiency, and other transportation topics, see the EPAct 2005 summary table.

Energy Policy Act of 1992

Enacted October 24, 1992
The Energy Policy Act (EPAct 1992) of 1992 (Public Law 102-486) aims to reduce U.S. dependence on imported petroleum and improve air quality by addressing all aspects of energy supply and demand, including alternative fuels, renewable energy, and energy efficiency. EPAct 1992 encourages the use of alternative fuels through both regulatory and voluntary activities and approaches the U.S. Department of Energy (DOE) carries out. It requires federal, state, and alternative fuel provider fleets to acquire alternative fuel vehicles. EPAct 1992 also defines "alternative fuels" as: methanol, ethanol, and other alcohols; blends of 85% or more of alcohol with gasoline (E85); natural gas and liquid fuels domestically produced from natural gas; propane; hydrogen; electricity; biodiesel (B100); coal-derived liquid fuels; fuels, other than alcohol, derived from biological materials; and P-Series fuels, which were added to the definition in 1999. Under EPAct 1992, DOE has the authority to add more alternative fuels to the list of authorized alternative fuels if certain criteria are met. DOE's Clean Cities initiative was established in response to EPAct 1992 to implement voluntary alternative fuel vehicle deployment activities. For more information, visit the EPAct website.

Surface Transportation Acts

Enacted December 18, 1991; June 9, 1998; August 10, 2005; and July 6, 2012
The national surface transportation acts authorize funds for highway construction, and highway safety and public transportation programs. The Intermodal Surface Transportation Efficiency Act (ISTEA) of 1991 (Public Law 102-240) establishes the Congestion Mitigation and Air Quality (CMAQ) Improvement Program, which provides funding for projects and programs in air quality non-attainment and maintenance areas to reduce transportation-related emissions. The Transportation Equity Act for the 21st Century (TEA-21) of 1998 (Public Law 105-178) continues the CMAQ program and establishes the Clean Fuels Grant Program, which allows transit systems to apply for and receive grants to purchase or lease clean fuel buses, related equipment or facilities, and use biodiesel. The Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) (Public Law 109-59), enacted in 2005, continues and amends several programs established under ISTEA and TEA-21, including CMAQ and the Clean Fuels Grant Program. SAFETEA-LU also establishes additional programs and incentives related to alternative fuels, advanced vehicles, and fuel efficiency, including the alternative fuel excise tax credit. The Moving Ahead for Progress in the 21st Century (MAP-21) Act (Public Law 112-141), enacted in 2012, continues and amends existing programs, including CMAQ, and establishes additional funding opportunities for alternative fuel infrastructure and research.

Clean Air Act Amendments of 1990

Enacted November 15, 1990
The Clean Air Act Amendments (CAAA) of 1990 (Public Law 101-549) amend the Clean Air Act (CAA) of 1970. CAAA of 1990 substantially increase EPA's regulatory authority and create several initiatives to reduce mobile source pollutants, including establishing fuel quality controls and tighter pollution standards for motor vehicle emissions. For more information, refer to EPA's Overview of the Clean Air Act Amendments of 1990.

Alternative Motor Fuels Act

Enacted October 14, 1988
The Alternative Motor Fuels Act (AMFA) of 1988 (Public Law 100-494) creates vehicle manufacturer incentives in the form of Corporate Average Fuel Economy (CAFE) credits for the production of motor vehicles capable of operating on certain alternative fuels. AMFA also directs the U.S. Department of Transportation, in consultation with the U.S. Environmental Protection Agency and the U.S. Department of Energy (DOE), to conduct a study and submit a report to Congress evaluating the success of the policy decision to offer CAFE credit calculation incentives for dual-fuel vehicles. DOE submitted the report, Effects of the Alternative Motor Fuels Act CAFE Incentives Policy, to Congress in March 2002. AMFA fuel economy provisions were extended by the Automotive Fuel Economy Manufacturing Incentives for Alternative Fueled Vehicles Rule of 2004. AMFA also requires the creation of an alternative fuels education and data resource center. As a result, the Alternative Fuels and Advanced Vehicles Data Center was established in 1991 at DOE's National Renewable Energy Laboratory.

AMFA also required the creation of an alternative fuels education and data resource center. As a result, the Alternative Fuels and Advanced Vehicles Data Center was established in 1991 at DOE's National Renewable Energy Laboratory.

Energy Policy and Conservation Act (EPCA) of 1975

Enacted December 22, 1975
The Energy Policy and Conservation Act (EPCA) of 1975 (Public Law 94-163) establishes Corporate Average Fuel Economy (CAFE) standards for on-road vehicles beginning with Model Year (MY) 1978 in order to improve the overall fuel efficiency of new motor vehicles. EPCA grants the U.S. Department of Transportation's National Highway Traffic Safety Administration the authority to regulate CAFE standards, with the requirement that new standards may not be proposed more than five model years at a time. EPCA also requires the U.S. Department of Energy to publish and distribute an annual fuel economy guide for consumers. For more information, refer to the CAFE and FuelEconomy.gov websites.

Clean Air Act of 1970

Enacted December 31, 1970
The Clean Air Act (CAA) of 1970 (Public Law 91-604) defines the U.S. Environmental Protection Agency's (EPA) responsibilities for protecting and improving air quality. CAA authorizes the development of comprehensive federal and state regulations to limit both stationary and mobile emissions sources, including authorizing the establishment of National Ambient Air Quality Standards (NAAQS), establishing requirements for State Implementation Plans to achieve these standards, authorizing the establishment of emissions standards for hazardous air pollutants, and authorizing requirements to control motor vehicle emissions. For more information, refer to EPA's Plain English Guide to the Clean Air Act.