$2B Cash for Clunkers Supplement Signed Into Law; Funding Taken from Renewable Energy Loan Guarantee Program
On Friday, President Obama signed into law H.R. 3435, which provides $2 billion FY 2009 emergency supplemental appropriations for the Consumer Assistance to Recycle and Save Program (Cash-for-Clunkers, C4C).
The C4C program, which began in late July, encouraged a surge in auto sales, with the original $1 billion funding depleting in approximately one week. Edmunds.com calculated the Seasonally Adjusted Annualized Rate (SAAR) of auto sales in the last week of July surged to 19.6 million, with the SAAR for the month closing out at 12.5 million. Monthly SAAR had been below 10 million for the prior six months in 2009.
The top-selling model under C4C program was the Ford Escape, according to an Edmunds.com analysis. Edmunds.com included sales of all Escape models in its calculation. Government figures, which tallied individual model variants as separate vehicles, concluded that the Ford Focus was the top seller.
The additional $2 billion for the supplementary funding to keep the C4C program going is being transferred from the amount made available for Department of Energy--Energy Programs—Title 17—Innovative Technology Loan Guarantee Program in title IV of division A of the American Recovery and Reinvestment Act of 2009 (Public Law 111-5).
In anticipation of the Senate passage of the bill earlier in the week, Renewable Fuels Association President and CEO Bob Dinneen issued a statement, saying:
Simply continuing to put gasoline and other petroleum-based fuels in our gas tanks, even if less often, only perpetuates our reliance on oil too often coming from unstable regions of the world. The loan guarantee program being tapped to provide the cash for the clunkers is critical to bringing next generation biofuels and other renewable energies to the marketplace. Companies seeking to turn sugar waste and other cellulosic materials into biofuel, for example, were looking to this program as the security they need to take the risks that will accelerate the commercialization of their technologies. Now, those companies are forced to anxiously wait and see if Congress will replace those funds.
We support the efforts to improve fuel efficiency, and this program is a good step. But it should not come at the expense of technologies that will lead America away from petroleum all together. We strongly encourage Congress to replace the $2 billion borrowed at the first possible opportunity.