Innovative financial tools could spur alternative fuel vehicle market

Press Release
Dec. 20, 2013
Contact: Marty Niland,, 703-516-4146

Innovative financial tools could spur alternative fuel vehicle market

WASHINGTON – Innovative financial tools that have helped expand clean energy technology could also help advance alternative fuel vehicles and infrastructure, according to a report released today by the Center for Climate and Energy Solutions (C2ES).

The C2ES report examining the barriers to increased private investment is the first step in a two-year initiative in partnership with National Association of State Energy Officials (NASEO) to develop innovative finance mechanisms aimed at accelerating the deployment of alternative fuel vehicles and fueling infrastructure.

Alternative fuel vehicles (AFVs) such as electric, fuel cell and natural gas cars, trucks and buses can help improve air quality, reduce oil consumption and reduce the heat-trapping greenhouse gas emissions that are contributing to climate change. But high upfront costs, the lack of widespread fueling options, and consumers’ need for more information are all barriers to market growth.

The report, Alternative Fuel Vehicle and Fueling Infrastructure Deployment Barriers and the Potential Role of Private Sector Financial Solutions, explores how innovative financial tools could help overcome these barriers.

Tools that could help mobilize stronger private investment include:

  • Leasing: Various leasing plans allow a buyer to avoid high upfront costs and take advantage of government incentives.
  • Performance contracting: The higher upfront costs of alternative fuel vehicles or new fueling infrastructure can be repaid through future operational and fuel cost savings.
  • Clean energy banks: Quasi-public or public financing institutions can leverage limited public dollars to attract private capital for investment in AFV and fueling infrastructure deployment.

“Sales of electric vehicles in the United States this year were nearly double 2012 levels, thanks in part to government initiatives and incentives. But for alternative fuel vehicles to spread beyond early adopters, more private investment will be needed,’’ said Nick Nigro, senior manager of transportation initiatives at C2ES. “Innovative financial tools have helped overcome barriers faced by other clean energy technologies, such as renewable energy or energy efficiency upgrades, and could help advance alternative fuel vehicles.”

Read the report.

About C2ES

The Center for Climate and Energy Solutions (C2ES) is an independent, nonprofit, nonpartisan organization promoting strong policy and action to address the twin challenges of energy and climate change. Launched in November 2011, C2ES is the successor to the Pew Center on Global Climate Change. Learn more at