U.S. grants $300 mln for alternative fuel vehicles

WASHINGTON (Reuters) - The U.S. Energy Department will award nearly $300 million to a clean cities program to help communities buy alternative-fuel vehicles, Vice President Joe Biden and Energy Secretary Steven Chu said on Wednesday.

The funding from the U.S. government's economic stimulus package is designed to encourage states and cities to reduce dependence on oil by helping pay for more than 9,000 alternative-fuel and energy-efficient vehicles, the Energy Department said.

It will also establish 542 fueling and recharging stations for the vehicles, the department said.

One project will complete a 700-mile regional liquid natural gas (LNG) fueling corridor connecting infrastructure in Southern California and LNG fuel stations being developed in Utah. The corridor will be along one of the nation's busiest trucking routes.

Overall, the department estimated the funding will help the clean cities program save about 38 million gallons (144 million litres) of petroleum annually.

Chu said the vehicles will mostly be American made, providing a boost to the lagging U.S. auto and manufacturing industries.

"By changing how we drive, we are actually driving economic recovery," he said.

Ethanol groups have called for greater use of so-called "flex fuel" vehicles that can use special fuel blends of up to 85 percent ethanol and 15 percent gasoline.

President Barack Obama has said he would like to see more electric vehicles in the United States by 2015.

For more details about the projects chosen, please click: here