Clean Energy Intel's  Instablog

For anyone following the progress of the Natural Gas Act in the Senate, the latest is that in the last 24 hours the Senate Democrats decided to cancel the vote, which had originally been scheduled for today.

The Act in question (more properly called S.3815: Promoting Natural Gas and Electric Vehicles Act of 2010) was of course introduced by Senate Majority Leader Harry Reid just before the recess and offers a range of incentives for the natural gas transportation sector, as well as some incentives for the electric car, with total costs estimated to amount to as much as $4.7bn. Of that around $3.8bn is to be directed towards rebates for the purchase of natural gas vehicles, whilst $500m would be provided as incentives for infrastructure and $400m for electric vehicle deployment.

It is difficult to assess the prospects for the Act at present. However, Harry Reid's office has apparently stated that the reason for the cancellation was to allow more time for compromise to be reached with the Senate's Republicans. Consequently, the delay might not be a bad thing.

Many Republicans of course, would welcome these measures on national security grounds. Moving the nation's trucks onto natural gas would of course be a solid step towards reducing the nation's reliance on foreign oil.

However, the point at issue has been the Act's proposal for funding these incentives - an increase in the tax oil companies pay into the Oil Spill Liability Trust Fund from 8 cents to 21 cents per barrel.

Perhaps Reid's people now feel that an alternative funding compromise can be found.

The two stocks most likely to be affected by the vote are of course Clean Energy Fuels (CLNE) and Westport Innovations (WPRT). On the positive side, not much seems to have been priced into either stock in terms of a positive outcome. Whether or not the delay takes us into next year, both still seem worth holding for now.



Disclosure: Long CLNE, Long WPRT