The list below contains summaries of all Alabama incentives and laws related to Ethanol.
Companies that invest in the development of a biofuel production facility may be eligible for a tax credit of up to 5% of the capital costs of the project. Companies may claim this credit against the state income tax or the financial institution excise tax liability that the project generates each year for up to 20 years. For the purposes of the credit, biofuel is defined as a motor vehicle fuel that is produced from grain, starch, oilseeds, vegetable, algae, animal, or fish materials including fats, greases and oils, sugarcane, sugar beets, sugar components, tobacco, potatoes, and lignocellulosic or other biomass. To be eligible for the tax credit, the capital costs of the production facility must be at least $2,000,000 if the facility is not located in a favored geographic area and $500,000 if the facility is located in a favored geographic area. A favored geographic area is defined as an area or county that is designated as an enterprise zone or that the Alabama Department of Industrial Relations considers to be less developed. (Reference Code of Alabama 40-9B-3, 40-18-190, 40-18-193, 40-18-194, and 40-18-202.1)
The Alabama Legislature will establish a Green Fleets Policy (Policy) outlining a procedure for procuring state vehicles based on criteria that includes fuel economy and lifecycle costing. State fleet managers must classify their vehicle inventory for compliance with the Policy and submit annual plans for procuring fuel-efficient vehicles. These plans must reflect a 4% annual increase in average fleet fuel economy for light-duty vehicles, a 3% annual increase in average fleet fuel economy for medium-duty vehicles, and a 2% annual increase in average fleet fuel economy for heavy-duty vehicles per fiscal year. The Policy will also require that government entities manage and operate their fleets in a manner that is energy efficient, minimizes emissions, and reduces petroleum dependency by using specified proven technology the Green Fleet Review Committee identifies. (Reference Code of Alabama 41-17A)
The Alabama Legislature urges the Alabama Department of Finance to invite all state agencies, commissions, boards, counties, and municipalities to join an interagency Alternative Fuels Working Group to promote education, research and development, production, and consumption of alternative fuels. (Reference Senate Joint Resolution 16, 2009)
The Center for Alternative Fuels (Center) promotes alternative fuels as viable energy sources in the state. The Center must assess the current status and development of sources of alternative fuels, ensuring that all alternative fuels sold in the state meet ASTM standards, and act as an information center for alternative fuels and a clearinghouse for available federal grant funding for alternative fuel development. The Center may administer a grant program using income tax check-off program funds from the Alabama Alternative Fuels and Research Development Fund. (Reference Code of Alabama 2-2-90 and 2-2-91)
The Alabama Department of Economic and Community Affairs administers the Alabama Research Alliance (ARA), which facilitates scientific research and development, including agricultural research and development activities related to biofuels. The ARA may use received income to support research and development activities. (Reference Executive Order 37, 2007)