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[OT] Pickens Predicts CNG Bill Enacted by May 2010

[Does anyone here think this prediction is a good one? If not, why not?]

http://www.bloomberg.com/apps/news?pid=20601103&sid=a9_1lAizYyDw

›By Christopher Martin and Daniel Whitten

Jan. 21 (Bloomberg) -- U.S. legislation with new incentives for natural-gas-powered vehicles will pass by late May because Democrats need to gain a bipartisan victory, T. Boone Pickens, founder and chairman of Dallas-based BP Capital LLC, said.

“We’ve got a bill that’s set to go,” Pickens said in an interview today on Bloomberg Television. “It will pass by Memorial Day.” Memorial Day is on May 31 this year.

Pickens, who put his personal worth at $1.5 billion, down from $3 billion when oil prices peaked in July 2008, said he started a $62 million promotion that summer for a national energy plan that relies on domestically produced natural gas and wind energy to cut U.S. dependence on foreign oil. Now he’s focused on replacing fleet cars and particularly trucks that run on gasoline and diesel fuel with those that use cleaner-burning natural gas.

The 28-page Senate legislation, which doubles 2005 tax incentives for buying vehicles fueled by natural gas, was offered by Senate Majority Leader Harry Reid, a Nevada Democrat, in July. The measure has enough support to advance through Congress, and newly weakened Democrats need to show they can pass legislation, Pickens explained later in a separate interview.

Following debate on a health-care bill that passed the Senate only with the support of 60 Democrats, and the loss of the late Edward Kennedy’s Democratic seat this week, Democrats want to promote measures that have bipartisan support and the Pickens bill is one of them, said Patrick Hughes, an analyst with Washington-based Height Analytics.

One-Seat Loss

Legislation needs 60 votes to overcome procedural hurdles in the Senate. President Barack Obama has signaled a willingness to scale back the health-care bill, and Democrats including Dianne Feinstein of California have said the Senate isn’t going to pass cap-and-trade energy legislation approved in the House in June.

“Obama needs desperately a bipartisan issue to pass,” Pickens said. “Cap-and-trade doesn’t pass, it’s a dead duck.”

The Pickens measure also has the support of Senators Robert Menendez, a New Jersey Democrat, and Orrin Hatch, a Utah Republican. There is a similar bill in the House, which Pickens says has 127 co-sponsors.

Pickens said that in addition to Reid, he has enlisted the support of House Speaker Nancy Pelosi, a California Democrat, and House Majority Leader Steny Hoyer of Maryland.

“Leadership is looking to assemble a series of provisions that are far less divisive and that will allow them to get something done as either a down payment on future climate legislation or as a final product itself,” Hughes said in a telephone interview.

President’s Signature

Hughes said the plan could be sent to the president in the second quarter of this year as part of broader energy legislation that also could promote renewable energy sources and efficiency measures.

Under the plan, tax credits can be used to cover 80 percent of the added cost to buy natural gas-fueled vehicles over those powered by gasoline or diesel. They would be increased to as high as $12,500 for passenger cars and light trucks and as much as $64,000 for higher weight-class vehicles, according to a summary of the legislation. Credits for refueling stations would be doubled to as much as $100,000. [Without many more of these, compressed-NG vehicles will never spread beyond use in corporate fleets.]

Pickens’s plan would initially emphasize the 8.5 million heavy-duty trucks on the road. At least 10 percent of those could be run on natural gas in the next five years, he said.

Foreign Dependence

The measure would pay off in decreased dependence on oil from overseas, which Pickens said was worth $265 billion in 2009. While a proliferation of natural-gas vehicles could raise the price of the fuel slightly, he said it would still be cheaper than using gasoline or diesel.

The Potential Gas Committee, a group of industry, government and academic volunteers, said last year advances in development of gas in shale formations have increased available U.S. supplies 39 percent since a 2007 report. The U.S. has an estimated 1,836 trillion cubic feet, enough for 100 years of current use, according to the group.

“This president can actually in the morning make a speech and say I’ll be the only president that America’s ever had that reduced foreign imports of oil,” Pickens said. “You have a resource that can replace foreign oil, we now have it. I believe it’s divine intervention.”‹