Green Operations

How to Find Available Money for Your Fleet

May 2011, Green Fleet Magazine - Cover Story

by Richard Battersby

With the surge of interest in greenhouse gas emissions, carbon footprints, and mitigating the environmental impacts of fleet operations, the use of alternative-fuel and advanced technology vehicles, such as hybrid-electric (HEV) and plug-in hybrid electric (PHEV), has become much more prevalent. In fact, for some fleet operations (such as those falling under EPAct regulations), the purchase of alternative-fuel vehicles (AFVs) in specific percentages is mandated by the federal government. Recent surveys have also confirmed that fleets are voluntarily purchasing clean air alternative fuel and advanced technology vehicles in record quantities.

Unfortunately, with very few exceptions, such as flex-fuel vehicles (FFVs) capable of operating on gasoline or E-85 ethanol, alternative-fuel and advanced technology vehicles require a larger capital outlay to procure. Simply put, clean air vehicles cost more than their gasoline-powered counterparts. 

Determining how to pay for these typically more expensive clean air vehicles has also consistently been identified as a growing concern for fleet managers overseeing cash-strapped fleet operations. But there is a silver lining contained within the current economic cloud. Despite the floundering economy and budget woes in general, a record amount of grant and incentive funding for clean air vehicles has also been made available. For example, in 2009 the federal Department of Energy (DOE) made nearly $300 million of American Reinvestment and Recovery Act (ARRA) funding available through the Clean Cities program. This single grant funding opportunity is responsible for putting more than 9,000 alternative-fuel and energy-efficient vehicles on the road and establishing 542 refueling stations across the country.

Become Familiar with the Process

Now more than ever, it is essential for fleet managers to be able to identify and successfully seek out all available funding sources for vehicle acquisitions. It can be challenging to remain abreast of all current clean air vehicle grant funding opportunities, but with a little effort and some networking, the undertaking may be greatly simplified. The objective is to become aware of emerging grant funding opportunities early in the process in order to have time to produce a quality proposal. A good strategy is to focus only on those grants that will definitely benefit your organization and also offer a reasonable opportunity for success. In order to do all of this efficiently, fleet managers must become familiar with grants in general.

There are two main types of grant funding awarded: competitive and formulaic. A competitive grant is a grant for which multiple applications are solicited, which then compete against each other for award. Typically, competitive grants will have specific criteria that allow proposals to be compared to each other and evaluated in order to select the most qualified application(s) for the award.

Formulaic grants, also known as block grants, are not competitively evaluated but are distributed proportionally amongst applicants based upon an established formula or criteria. Under a formulaic grant program, all qualified applicants receive a percentage of the total award. A commonly used criterion for award of formulaic grants is population size.

Fleets have historically concentrated on applying for competitive grants, but there has been a trend lately of fleets accessing formulaic/block grant funds awarded to their community. While the lion’s share of fleet grant funding will be provided through competitive grants, a savvy fleet manager will also learn about any formulaic/block grants coming into their organization to be ready when opportunities arise to take advantage of them. This article will focus on competitive grant funding sources.

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