The U.S. Department Of Energy is providing up to $2.4 billion in American Recovery and Reinvestment Act funds to support next-generation plug-in hybrid electric vehicles and their advanced battery components. These new plug-in hybrid electric vehicles will have the potential to travel up to 40 miles without recharging. Beyond that 40-mile range, the vehicles will run much like today’s hybrids, achieving high fuel economies, the DOE said. Overall, plug-in hybrids are expected to achieve fuel economies as high as 100 miles per gallon.

But for such vehicles to be practical will depend on the development of advanced, lightweight batteries that can meet tough requirements for durability and performance. Of the $2.4 billion in grant money, $1.5 billion will go to U.S. manufacturers to produce high-efficiency batteries and their components; $500 million will go to U.S. manufacturers to produce other components needed for electric vehicles, such as electric motors; and $400 million will go toward projects that demonstrate and evaluate plug-in hybrids and other electric infrastructure concepts.

The DOE will provide assistance to construct or upgrade battery manufacturing, component and recycling plants for lithium-ion and other advanced batteries, as well as for factories producing the power electronics for electric drive vehicles. These agreements will help lower the cost of battery packs, batteries and electric propulsion systems. The agency will also support demonstration, evaluation and education projects to help develop the market for advanced electric drive vehicles.

When these plug-in hybrid vehicles are offered for sale, U.S. residents who purchase them will be able to claim a tax credit of up to $7,500.

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