Falling oil prices slow alt fuel projects

WASHINGTON, Oct. 20 (UPI) -- Declining oil prices and the credit crisis are threatening plans to ramp up production of U.S. alternative energy projects, industry observers say.

With the price of oil tumbling due to declining demand and financial market turmoil making it harder to find venture capital for expensive projects, a wide array of plans to find alternatives to oil are facing slowdowns, The Washington Post reported Monday.

U.S. automakers facing unprecedented pressures in the car industry are worrying about mere survival more than rolling out electric cars. General Motors, has been promoting the Chevy Volt as the first mass-marketed, plug-in hybrid vehicle, is concentrating on its merger talks with Chrysler LLC in an effort to find operating cash, the newspaper said.

Much-needed venture capital for projects ranging from new auto assembly lines to solar panels to wind turbines is also getting harder to find as market disruptions have spurred a "flight to safety" by investors.

"Declining oil prices can give us an artificial and temporary sense that reducing oil consumption and energy consumption is an issue we can put off," Greg Kats of Good Energies, a venture capital firm that invests in global clean energy, told the Post.