Oregon Incentives and Laws

Listed below are the summaries of all current Oregon incentives, laws, regulations, funding opportunities, and other initiatives related to alternative fuels and vehicles, advanced technologies, or air quality. You can go directly to summaries of:

• State Incentives (9)
• Utility/Private Incentives (2)
• Laws and Regulations (12)

State Incentives

Biofuels Use Tax Credit

Oregon residents are eligible for an income tax credit of $0.50 per gallon of gasoline blended with at least 85% ethanol (E85) or diesel blended with at least 99% biodiesel (B99) purchased for use in an alternative fuel vehicle (AFV), up to $200 per tax year for each AFV that is registered in Oregon and owned or leased by the resident. For the purpose of this tax credit, an AFV is a motor vehicle that can operate using E85 or B99. This incentive is applicable until January 1, 2013. (Reference Oregon Revised Statutes 315.465)

Alternative Fueling Infrastructure Tax Credit for Residents

Through the Residential Energy Tax Credit program, qualified residents may receive a tax credit for 25% of alternative fuel infrastructure project costs, up to $750. Qualified alternative fuels include electricity, propane, hydrogen, and other fuels that the Oregon Department of Energy approves. Gasoline blended with at least 85% ethanol (E85) also qualifies as an alternative fuel. A company that constructs a dwelling in Oregon and installs fueling infrastructure in the dwelling may claim the credit. This credit is available through December 31, 2017. (Reference House Bills 3672 and 3606, 2011, and Oregon Revised Statutes 316.116, 317.115, and 469.160-469.180)

Alternative Fueling Infrastructure Tax Credit for Businesses

Beginning January 1, 2011, business owners and others may be eligible for a tax credit of 35% of eligible costs for qualified alternative fuel infrastructure projects. Qualified infrastructure includes facilities for mixing, storing, compressing, or dispensing fuels for vehicles operating on electricity, ethanol, natural gas, and propane. Unused credits can be carried forward up to five years. Non-profit organizations and public entities that do not have an Oregon tax liability may receive the credit for an eligible project but must "pass-through" or transfer their project eligibility to a pass-through partner in exchange for a lump-sum cash payment. The Oregon Department of Energy (ODOE) determines the rate that is used to calculate the cash payment. The pass-through option is also available to a project owner with an Oregon tax liability who chooses to transfer their tax credit. The credit is available through December 31, 2018. (Reference House Bill 3672, 2011)

Alternative Fuel School Bus Grant and Loan Program

The Oregon Department of Energy (ODOE) must establish the Clean Energy Deployment Program. Under this program, school districts may be eligible for grants and loans to retrofit school bus fleets to operate on compressed natural gas, propane, or other alternative fuels, or to operate with highly efficient engine technologies, such as hybrid electric engines. Funds may also be used to replace school buses with buses that operate on these fuels or technologies. (Reference House Bill 2960, 2011)

Alternative Fuel Loans

The Oregon Department of Energy administers the State Energy Loan Program (SELP) which offers low-interest loans for qualified projects. Eligible alternative fuel projects include fuel production facilities, dedicated feedstock production, fueling infrastructure, and fleet vehicles. Loan recipients must complete a loan application and pay a loan application fee. (Reference House Bill 3672, 2011, and Oregon Revised Statutes 470)

Biofuels Production Property Tax Exemption

Property used to produce biofuels may be eligible for a property tax exemption if it is located in a designated Renewable Energy Development Zone. The Oregon Business Development Department must receive and approve an application from a qualified rural area to designate the area as a Rural Renewable Energy Development Zone. (Reference Oregon Revised Statutes 285C.350 through 285C.370)

Idle Reduction Weight Exemption

A vehicle equipped with a fully functional idle reduction system designed to reduce fuel use and emissions from engine idling may exceed the maximum weight limitations by up to 400 pounds to accommodate the added weight of the idle reduction technology. (Reference Oregon Revised Statutes 818.030)

Pollution Control Equipment Exemption

Dedicated original equipment manufacturer natural gas vehicles and all-electric vehicles are not required to be equipped with a certified pollution control system. (Reference Oregon Revised Statutes 815.300)

Electric Vehicle (EV) Charging Infrastructure Project Funding

The Oregon Department of Transportation will fund the installation of qualified EV charging infrastructure in rural areas along the I-5 West Coast Green Highway corridor. Competitive funding is available from the American Recovery and Reinvestment Act. For more information see the Electric Vehicle Charging Network website.

Utility/Private Incentives

Electric Vehicle Supply Equipment (EVSE) Incentive - ECOtality

Through the EV Project, ECOtality offers EVSE at no cost to individuals in the Portland, Eugene, Salem, and Corvallis metropolitan areas. To be eligible for free home charging stations, individuals living within the specified areas must purchase a qualified plug-in electric vehicle (PEV). Individuals purchasing an eligible PEV should apply at the dealership at the time of vehicle purchase. The EV Project incentive program will also cover most, if not all, of the costs of EVSE installation. All participants in the EV Project incentive program must agree to anonymous data collection after installation. Additional restrictions may apply.

Idle Reduction Incentives

Cascade Sierra Solutions (CSS) provides comprehensive idle reduction solutions for commercial trucks and trailers. Financing, loans, and grant programs are available to support verifiable technologies that save fuel and reduce diesel emissions, including alternative fuel and hybrid electric vehicle technologies. Options for upgrades or vehicle replacement are also available to registered truck owners. Tractor and trailer owners may be eligible for a 20% rebate on idle reduction equipment with electric standby capabilities if they agree to use electrified truck parking as an alternative to main engine idling.

Laws and Regulations

State Greenhouse Gas (GHG) Emissions Reduction Strategy

As directed by the legislature, the Oregon Department of Land Conservation and Development (DLCD) set targets for six individual metropolitan areas to reduce GHG emissions from light-duty vehicles. The targets are intended to help meet the state's goal of reducing GHG emissions to 75% below 1990 levels by 2050 and provide guidance to local governments on how to reduce GHG emissions. In the Portland metropolitan area, land use and transportation scenario planning to meet these targets is required. These activities are encouraged in the other areas.

The Oregon Department of Transportation (ODOT) and DLCD were also directed to:

• Develop and adopt a Statewide Transportation Strategy;
• Develop a toolkit to assist local governments and metropolitan planning organizations in reducing GHGs from motor vehicles with a gross vehicle weight rating of 10,000 pounds (lbs.) or less;
• Educate the public about the need to reduce GHG emissions from motor vehicles and the related costs and benefits; and
• Report progress and recommendations to the state legislature.

(Reference Senate Bill 1059, 2010)

Establishment Low Carbon Transportation Fuel Standards

The Oregon Department of Environmental Quality (DEQ) developed a proposed low carbon fuel standard for all transportation fuels, including a lifecycle greenhouse gas (GHG) emission standard for the production, storage, transportation and combustion of fuels. DEQ will conduct a formal rulemaking process to seek review and comments in 2011. The proposed standards aim to reduce average GHG emissions per unit of fuel energy by 10% below 2012 levels by 2022. For more information, see the DEQ Low Carbon Fuel Standard website. (Reference House Bill 2186, 2009)

Renewable Fuels Mandate

All gasoline sold in the state must be blended with 10% ethanol (E10). Gasoline with an octane rating of 91 or above is exempt from this mandate, as is gasoline sold for use in certain nonroad applications. Gasoline that contains at least 9.2% agriculturally derived ethanol that meets ASTM specification D4806 complies with the mandate. For the purpose of the mandate, the ethanol must meet ASTM specification D4806. The governor may suspend the renewable fuels mandate for ethanol if the Oregon Department of Energy finds that a sufficient amount of ethanol is not available.

All diesel fuel sold in the state must be blended with at least 5% biodiesel (B5). For the purpose of this mandate, biodiesel is defined as a motor vehicle fuel derived from vegetable oil, animal fat, or other non-petroleum resources, that is designated as B100 and complies with ASTM specification D6751. Diesel fuel blends sold between October 1 and February 28 may contain additives to prevent congealing or gelling. Beginning January 2, 2012, renewable diesel will qualify as a substitute for biodiesel in the blending requirement.

(Reference House Bill 3693, 2010, House Bills 2827, 2011, Oregon Revised Statutes 646.913-646.923, and Oregon Administrative Rules 603-027-0410 and 603-027-0420)

Commercial Vehicle Idle Reduction Requirement

Beginning January 1, 2012, a driver of a commercial vehicle may not idle the engine for more than five minutes in any sixty-minute period, unless the vehicle is using an auxiliary power unit, generator set, cargo temperature control unit, or other idle reduction technology that maintains heat or air conditioning or provides electrical power. Exceptions apply in certain situations and for certain vehicles. (Reference House Bill 2081, 2011)

Biodiesel Quality Testing Procedures

Each biodiesel or other renewable diesel producer, distributor, or importer must retain the certificate of analysis for each batch or production lot of B100 sold or delivered in the state for at least one year. The Oregon Department of Agriculture (ODA) or authorized agents may examine these records as necessary. The ODA or authorized agents may also perform on-site testing or obtain samples of biodiesel or other renewable diesel from any producer, bulk facility, or retail location that sells, distributes, transports, hauls, delivers, or stores biodiesel or other renewable diesel. The related testing cost is the responsibility of the business providing the sample. (Reference Oregon Revised Statutes 646.923)

Biofuels Program Impact Studies

The Oregon Department of Energy (Department) must conduct periodic impact studies related to the biofuels industry in the state. These studies should evaluate such criteria as: jobs created; current and projected feedstock availability; amount of biofuels blends produced and consumed in the state; cost comparison of biofuels blends and petroleum fuel; environmental impacts; and the extent to which Oregon producers import biofuels or biofuels feedstocks from outside the state. The Department issued the first Biofuels Impact Study in 2010 and will conduct a study every two years through January 1, 2025. (Reference Oregon Revised Statutes 469.785)

Low Emission Vehicle (LEV) Standards

Under the Oregon LEV Program, all new passenger cars, light-duty trucks, and medium-duty vehicles sold, leased, licensed, or delivered for sale in the state must meet California vehicle emissions standards stated in Title 13 of the California Code of Regulations, Section 1962. Exemptions may apply. Each motor vehicle manufacturer must comply with the fleet average emission requirements, as well as the warranty, recall, and other applicable requirements. (Reference Oregon Revised Statutes 468A.360 and Oregon Administrative Rules 340-257)

Vehicle Registration Requirement

Motor vehicle registration applicants must provide proof of compliance with Oregon's low emission motor vehicle standards. This requirement applies to new vehicles with no more than 7,500 miles on the odometer when the vehicle is initially registered. The Oregon Department of Transportation may adopt rules that exempt certain new motor vehicles from the requirement. (Reference Oregon Revised Statutes 803.350)

Alternative Fuel Vehicle (AFV) Acquisition, Fuel Use, and Emissions Reductions Requirements

All state agencies and transit districts must purchase AFVs and use alternative fuels to operate those vehicles to the maximum extent possible, except when it is not economically or logistically possible to purchase or fuel an AFV. Each state agency must develop and report a greenhouse gas reduction baseline and determine annual reduction targets. Reports to the Oregon Department of Administrative Services must include the volume of ethanol and biodiesel used by state agency fleets, as well as any cost savings attributable to driving more fuel-efficient vehicles and using alternative fuels. (Reference Oregon Revised Statutes 283.327 and 267.030, and Executive Order 06-02, 2006)

Electric Vehicle (EV) and Hybrid Electric Vehicle (HEV) Registration Fees

EVs and HEVs are registered biennially, with the exception of new vehicles for which new registration plates are issued. Certain EVs and HEVs, including commercial buses, follow an annual registration period. The registration fee is $43 per vehicle for each year of the registration period. There is an additional fee for EVs or HEVs in certain weight categories. (Reference Oregon Revised Statutes 803.415 and 803.420)

Low-Speed Vehicle and Medium-Speed Electric Vehicle (EV) Access to Roadways

A low-speed vehicle is defined as a four wheeled motor vehicle capable of reaching speeds of up to 20 miles per hour (mph) but not more than 25 mph. A low-speed vehicle may not operate on a highway that has a posted speed limit of more than 35 mph. A medium-speed EV is defined as a four wheeled electric motor vehicle that is equipped with a roll cage or a crushproof body design and is capable of reaching speeds of up to 35 mph. A medium-speed EV may not operate on a highway that has a posted speed limit of more than 45 mph. A city or county may adopt ordinances that allow the operation of low-speed vehicles or medium-speed EVs on city streets or county roads that have posted speed limits greater than 35 mph and 45 mph, respectively. The Oregon Department of Transportation must adopt minimum safety standards for low-speed vehicles and medium-speed EVs and may deny a vehicle registration if the vehicle does not meet the safety standards. (Reference Oregon Revised Statutes 801.331, 801.341, and 811.512-811.513)

Regional Climate Change Initiative

Governors of Oregon, Washington, and California approved a series of recommendations for action to combat global warming, as detailed in the West Coast Governors' Global Warming Initiative. Each state must act individually and regionally to reduce greenhouse gases (GHGs). The initiative includes adopting standards to reduce GHG emissions from vehicles by expanding markets for efficiency, renewable energy and alternative fuels, including creating a working group on developing hydrogen fuel. Building upon this commitment, Oregon joined other western states and several Canadian provinces and signed an agreement establishing the Western Climate Initiative, a joint effort to reduce GHG emissions and address climate change.