The goal of the effort is to save 821 million gallons of gasoline and offset 8 million tons of greenhouse gas emissions by 2016.
The project is a huge shot in the arm for parts suppliers, manufacturers and other players in the green auto industry.
"This investment will create thousands of new American jobs and is another critical step in making sure we are positioned to compete for the clean energy jobs of the future," Chu said in a statement. "Plug-in hybrid electric vehicles could revolutionize personal transportation and cut our dependence on foreign oil, not to mention give us cleaner air and less carbon pollution."
In the first stage of the program, Fisker will use a $169.3 million loan to work with primarily U.S. suppliers to complete the company's first vehicle, the Fisker Karma (pictured above). The four-door car is scheduled to appear in showrooms in summer 2010.
The second stage includes a $359.36 million loan for Fisker's Project Nina, involving the manufacture of a plug-in hybrid in the U.S. (The name is inspired by the ship belonging to explorer Christopher Columbus, "symbolic of the automobile industry's transition from old world to new.")
Fisker estimates that up to 75,000 to 100,000 of the family-oriented vehicles will be produced each year, beginning in late 2012. A significant percentage will be exported, helping to balance the U.S. trade deficit.
Combined, the projects are supposed to save or create approximately 5,000 jobs.
Fisker's automobiles are driven by electric motors powered by a lithium-ion battery, as well as a long-distance system of a generator driven by a gasoline engine. Fisker says the battery can be charged at home overnight, and can cruise about 300 miles using gas and electric power.
President Barack Obama's administration has set a goal of having one million plug-in hybrids on the road by 2015. The funds are part of the U.S. Department of Energy's $25-billion Advanced Technologies Vehicle Manufacturing Loan Program, created by Congress in November 2008 to help promote the development of energy-efficient vehicles.
This post was originally published on Smartplanet.com