Energy Department Announces Funding to Develop Aggregate Purchasing Models
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On June 11, 2015: The Energy Department has announced up to $2 million to support aggregate purchasing models for plug-in electric and other alternative fuel and advanced technology vehicles, subsystems, components, alternative fuels, and refueling/charging infrastructure. Aggregated purchasing is when one central organization coordinates customers to maximize their collective buying power. By supporting a new type of buying system that could lower costs and expand product availability for alternative fuel and advanced technology vehicles, components, infrastructure, and fuels, this funding will help increase America’s economic, energy, and environmental security.
This funding will address two major barriers to the growth in production and sales of alternative fuel and advanced vehicle technologies: manufacturers’ uncertainty around demand and buyers’ high up-front costs. In addition, this funding will allow an entity to set up an aggregated purchasing system; work with fleets and other buyers to join the effort; consolidate participants’ vehicle, subsystems, component, fuel and infrastructure equipment orders; and develop best practices others can learn from. This funding will not pay for components, vehicles, fuel or infrastructure but instead aims to help original equipment manufacturers and suppliers increase production volumes, achieve economies of scale, and reduce incremental costs.
Through the Department’s Clean Cities program – which works with nearly 100 local coalitions and thousands of stakeholders across the country to decrease the use of petroleum in transportation – this funding will complement the work that Clean Cities coalitions do to help fleet managers and others choose alternative fuel vehicles that meet their needs.