Mar. 11--WASHINGTON -- AT&T said Wednesday it would spend up to $565 million to replace more than 15,000 gas-powered vehicles over the next decade with a fleet powered by compressed natural gas or hybrid engines.

The announcement is a boon for the movement to move American vehicles off traditional gasoline, a campaign that has been headlined by the Dallas energy investor T. Boone Pickens. AT&T said it would work with one of Pickens's companies, Clean Energy Fuels, to provide refueling infrastructure.

"It's obviously going to reduce our reliance on foreign oil," AT&T Chairman and CEO Randall L. Stephenson told the Economic Club of Washington on Wednesday. "My new neighbor, Boone Pickens, and I have talked a lot about that equation."

Stephenson said the investment would "significantly lower" AT&T's fuel costs and reduce greenhouse gas emissions by 25 percent. The Dallas-based company plans to move 8,000 heavy-duty vehicles to compressed natural gas and replace 7,100 passenger vehicles with hybrids over the next 10 years.

Tim Harden, AT&T's president of supply chain management and fleet operations, said AT&T would initially focus the effort on a limited number of states, including California, Oklahoma and Texas, where there are more refueling stations.

"There are not a lot of fueling stations today," Harden said. "We are going to have to develop those with the compressed natural gas companies so it's readily available."

Harden said AT&T would work with Clean Energy and Chesapeake Energy, two companies that spearheaded the campaign to get government incentives for fleet conversion.

-----

To see more of The Dallas Morning News, or to subscribe to the newspaper, go to http://www.dallasnews.com.

Copyright (c) 2009, The Dallas Morning News

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

NYSE:T, NASDAQ-NMS:CLNE, OtherOTC:CLER, NYSE:CHK,

A service of YellowBrix, Inc.