Americans aren't quick to embrace large-scale change, and the dependence on fossil fuels is no exception. Despite the attempts of the natural gas industry to position it as a cleaner, more efficient fuel, natural gas remains largely confined to household use.

TUTORIAL: The Industry Handbook: The Oil Services Industry

T. Boone Pickens made a fortune in the oil industry. In 2008, he launched an $82-million campaign to promote the Pickens Plan, an initiative to drastically reduce the United States' dependence on foreign oil. At the heart of this plan is the use of natural gas in trucks and buses, which would naturally lead to adoption in personal vehicles. The plan didn't immediately get attention, but in November, after repeated attempts to gain momentum in Washington, the NAT GAS Act of 2011 was introduced to Congress, with the intent of encouraging the use of natural gas in automobiles. This may be good news to the natural gas industry, as well as Pickens, but does the everyday consumer benefit?

Tax Benefits
If the bill passes as it was introduced, consumers who purchase a natural gas powered vehicle could receive a tax credit of up to $7,500 for a smaller vehicle and up to $64,000 for a larger truck. Up to 80% of the incremental cost of purchasing the vehicle could be eligible for the credit. (For related reading, see New Wheels: Lease Or Buy?)

Fuel Cost
A recent CNN study found that Americans are spending 9% of their total income on gas. That amounts to an average of $368.09 per month or $4,417.08 per year, just on fuel. A natural gas powered vehicle could cut your annual fuel costs by more than 50%. As of August 2011, natural gas for use in an automobile was less than $1.50 per gallon compared to gasoline powered vehicles filling up for more than $3.50.

Investment Opportunities
Direct savings from the bill aren't the only way that consumers could see a potential profit from an increased use of natural gas, and Boone Pickens knows that. Pickens was a co-founder and his wife still remains a major shareholder in Clean Energy Fuels, a company that builds natural gas fueling stations.

Clean Energy Fuels is only a $856 million company, but if this bill is signed into law, this company, as well as other integrated energy companies like Chesapeake Energy Corporation, ConocoPhillips and Halliburton, would all see long term gains. If this bill passes, individual investors who are looking for energy stocks to add to their portfolio should include companies with large exposure to natural gas. (For related reading on natural gas, see Natural Gas Industry: An Investment Guide.)

The Bottom Line
The NAT GAS Act of 2011 has supporters from both parties. With more than 150 sponsors, Washington insiders believe that this bill has a high probability of passing. If it does, the benefits to the natural gas industry will be vast. The bill includes tax subsidies for companies that build natural gas filling stations, therefore, this money saving fuel will become more widely available to consumers, saving them a substantial amount of money; something desperately needed in an economy that has made consumers much more cost conscious. (For related reading on subsidies, see Government Subsidies For Business.)

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