The program funds projects to encourage the development and use of new technologies and alternative and renewable fuels, including electricity, natural gas, biomethane, hydrogen, and gasoline and diesel substitutes, such as cellulosic ethanol (derived from woody materials, including agricultural waste), and biodiesel from waste grease. Funding sources include small surcharges on vehicle and vessel registrations, and license plate and smog abatement fees.

The program is an important component of California’s efforts to reduce greenhouse gas emissions to 80% below 1990 levels by 2050, as required by AB 32; decrease petroleum fuel use to 15% below 2003 levels by 2020; increase the use of alternative fuels to 26% of all fuel consumed by 2022; and reduce emissions of nitrogen oxides to 80% of 2010 levels by 2023 to help meet federal ozone standards in areas of California such as the San Joaquin Valley and South Coast air basins.

Currently, the state’s transportation sector accounts for nearly 40% of the state's greenhouse gas emissions; more than 95% of all transportation energy consumed in California is petroleum-based.

The 2013-2014 plan update allocates $100 million to projects in the following areas:

• $23 million for biofuels production and supply, with an emphasis on fuels made from waste-based and other low-carbon, sustainable materials.

• $20 million for hydrogen fueling infrastructure. An estimated 68 stations are needed to support the anticipated rollout of these vehicles in 2015-2017. Roughly 24 stations are built or in development.

• $15 million for medium- and heavy-duty electric truck and hybrid vehicle demonstration projects.

• $12 million for natural gas vehicle incentives. These incentives help to pay the difference between the cost of alternative-fuel vehicles and conventional vehicles. Buyers must agree to register and operate the vehicles in California at least 90 percent of the time for three years.

• $7 million for electric vehicle charging infrastructure, coordinated to fulfill the Governor’s ZEV Action Plan. Workplace, fleet and multi-unit dwelling projects will be given priority.

• $5 million for light-duty plug-in electric vehicle rebates to meet high demand for the Clean Vehicle Rebate Program, administered by the California Air Resources Board.

• $5 million for manufacturing projects, supporting economic development and clean transportation technology.

• $4 million to emerging opportunities. This allocation is not specifically tied to any single fuel or technology type, with a priority for projects that can leverage federal funding.

• $3.5 million for regional alternative fuel readiness and planning, building on previous projects supporting these efforts.

• $2 million for centers for alternative fuels and advanced vehicles to support collaborative efforts that promote innovation, demonstrate new technologies, leverage venture capital and federal funds, and provide workforce training.

• $2 million to workforce training and development.

• $1.5 million for natural gas fueling infrastructure to support growing use of these alternative fuel vehicles by many entities, including school districts.

In a separate action, the California Energy Commission approved $4,979,070 through the current ARFVT program to projects that will support increased numbers of cleaner, alternative fuel vehicles on California roadways. For the current fiscal year, the Commission will invest approximately $90 million to encourage the development and use of new technologies, and alternative and renewable fuels, to help the state meet its climate change goals.

These latest awards are:

• Green Charge Networks will receive $2,087,153 to install, operate, collect data and assess the performance of fast-charging electric vehicle infrastructure at 16 sites. These charging sites will be located at 7-Eleven convenience stores, and will provide a charging network in Ventura, Los Angeles, Orange, Riverside and San Diego counties. The agreement includes $2.5 million in match funding. Green Charge’s California offices are located in Huntington Beach (Orange County).

• City of Sacramento will receive $600,000 to install new liquefied natural gas (LNG) fueling equipment and refurbish existing LNG equipment in the city’s corporate yard in the south area of the city. A minimum of 30% of the LNG dispensed for city vehicles will be from renewable sources. The agreement includes $600,000 in match funding.

• A-Z Bus Sales, Inc. will receive $500,000 in vehicle buy-down incentive reservations for 25 propane school buses of 14,001 pounds or greater gross vehicle weight. These incentives are reserved by vehicle manufacturers or their designated dealers, and the purchase prices for buyers are reduced by the incentive amounts. Buyers are required to register and operate the vehicles in California at least 90 percent of the time for three years.

  The incentives are designed to help pay the difference between alternative-fuel vehicles and conventional vehicles. They are available only for new natural gas and propane vehicles that meet all the emission requirements of the California Air Resources Board.

• City of Santa Clarita (Los Angeles County) will receive $300,000 to install a self-serve, commercial, compressed natural gas (CNG) fueling facility capable of fueling up to four vehicles at a time. The Santa Clarity Valley currently has one public CNG station, located close to Interstate 5. This project will increase access to CNG fueling along the State Route 14 corridor. The agreement includes $900,000 in match funding.

• County of Santa Clara will received $300,000 to purchase and install a publicly accessible compressed natural gas (CNG) fueling station at a county fleet management facility in San Jose. This will reduce county fleet operating costs and facilitate the county’s purchase of new CNG buses and vehicles. The county estimates the project will result in eventual fuel cost savings of $266,764 annually. Replacing older, high-polluting buses and vehicles with new CNG buses and vehicles can help reduce greenhouse gas emissions. The agreement includes $714,000 in match funding.

• Murrieta Valley Unified School District (Riverside County) will receive $300,000 to construct the first phase of its planned compressed natural gas fueling infrastructure. This will support the district’s plan to replace its aging fleet of 50 diesel school buses with natural gas buses. The agreement includes $175,000 in match funding.

• Waste Management Collection and Recycling will receive $300,000 to upgrade an existing compressed natural gas (CNG) fueling station in the city of Moreno Valley (Riverside County). This publicly accessible station, located at 17700 Indian Street, will support Waste Management’s expanding fleet of CNG powered solid waste collection vehicles. The agreement includes $398,564 in match funding.

• Poway Unified School District (San Diego County) will receive $299,157 to replace two compressed natural gas (CNG) station compressors and a control panel to provide reliable refueling for the district’s 35 CNG school buses, as well as provide public CNG vehicle refueling.

• City of Anaheim (Orange County) will receive $292,760 to upgrade an existing compressed natural gas (CNG) station to support the city’s 47-vehicle CNG fleet and provide fueling capacity for the city’s planned acquisition over the next five years of five large CNG work vehicles, such as street sweepers and garbage trucks, and nine passenger-sized CNG vehicles. The agreement includes $342,972 in match funding.