n. A government program designed to reduce energy use and pollution by levying a fee on fuel-inefficient vehicles and offering a rebate on fuel-efficient vehicles.
Other Forms
Levy hefty taxes on buyers of fuel guzzlers. Give generous rebates to consumers who buy the most fuel-efficient vehicles. Call the combo "feebates."

For years, environmental groups have backed feebates to encourage consumers to buy vehicles that burn less fuel - and, as a result, emit lower volumes of greenhouse gases.

While Congress generally steers clear of anything resembling a tax increase, some states are taking up legislation to create feebate programs. California, which has taken the lead among states in seeking to curb greenhouse gases, is in the forefront of the feebate movement.
—Harry Stoffer, “'Feebate' programs may help states fight warming,” Automotive News, April 16, 2007
A feebate under consideration in Connecticut would set a sliding-scale sales tax between 3 percent and 9 percent for car purchases, depending on fuel efficiency.

For a $25,000 car, that could mean up to $1,500 - enough to make consumers think twice.
—Brian Nearing, “Putting price on climate change,” The Times Union, November 30, 2006
1990 (earliest)
How can we promote fuel efficiency? Higher gasoline taxes are a weak incentive to buy an efficient car, because gasoline costs four times less than the non-fuel costs of owning and running a car. And, since the often higher purchase price of an efficient car about cancels out the lower gasoline bills, the total cost per mile for 20- and 60- mile-per-gallon cars is about the same.

But the 40-mile-per-gallon difference represents more than twice America's imports from the gulf. If the security and environmental costs of inefficient cars had to be paid up front, buyers would choose more wisely. The best way is "feebates." When you register a new car, you pay a fee or get a rebate, depending on its efficiency. The fees would pay for the rebates.
—Amory B. Lovins & L. Hunter Lovins, “Make Fuel Efficiency Our Gulf Strategy,” The New York Times, December 03, 1990