The list below contains summaries of all Indiana incentives and laws related to Ethanol.
The Indiana Economic Development Corporation (IEDC) may award tax credits under the Hoosier AFV Manufacturer Tax Credit to foster job creation, reduce dependence on imported energy sources, and reduce air pollution resulting from the manufacture or assembly of light-duty AFVs in Indiana. AFV manufacturers are eligible for tax credits of up to 15% of qualified investments, which include expenditures in the state that are reasonable and necessary for the manufacture or assembly of AFVs. To be eligible, the manufacturer must compensate its employees at least 150% of the state's hourly minimum wage and agree to maintain operations for at least 10 years. Additional restrictions apply. For the purpose of this incentive, AFVs are defined as vehicles designed to operate on E85, biodiesel, ultra low sulfur diesel fuel, natural gas, liquefied petroleum gas (propane), hydrogen, methanol, coal-derived liquid fuels, non-alcohol fuels derived from biological material, P-Series fuels, or electricity. IEDC must review and approved applications for this incentive. The credit applies to taxable years beginning after December 31, 2006, and before December 31, 2012. Unused credits may be carried forward for up to nine consecutive taxable years. (Reference Indiana Code 6-3.1-31.9)
The Indiana Economic Development Corporation administers the Indiana 21st Century Research and Technology Fund, which provides grants and loans to support proposals for economic development in high technology industry clusters. Incentives are available for qualified alternative fuel technologies and fuel-efficient vehicle production. (Reference Indiana Code 5-28-16-2)
An ethanol producer located in Indiana is entitled to a credit of $0.125 per gallon of ethanol produced, including cellulosic ethanol. The Indiana Economic Development Corporation must review and approve applications for this credit. The credit granted to a single taxpayer may not exceed the following amounts for all taxable years:
| Tax Credit | Annual Production |
|---|---|
| $2 million | More than 40 million and less than 60 million gallons of grain ethanol |
| $3 million | At least 60 million gallons of grain ethanol | $20 million | At least 20 million gallons of cellulosic ethanol |
Any unused credit may be carried forward for the following taxable years. As of March 2011, no funds have been appropriated for this incentive.
(Reference Indiana Code 6-3.1-28)
An E85 retailer may deduct $0.18 from the required state gross retail tax for every gallon of E85 sold before July 1, 2020. Reimbursement is contingent upon available funding from the Retail Merchant E85 Deduction Reimbursement Fund (Fund), which the Indiana State Budget Agency maintains. On July 1 of each year, the Indiana Corn Marketing Council (Council) will ensure that the Fund totals at least $500,000. As necessary, the Council will transfer the difference into the Fund. (Reference Indiana Code 6-2.5-7-5, 6-6-1.1-103, 15-15-12-30.5, and 15-15-12-32.5)
A political subdivision that purchases E85 for use in flexible fuel vehicles (FFVs) may be entitled to a monthly E85 incentive payment of $33.33 for each FFV that has been owned by the political subdivision for less than five years. To be eligible, 75% of the political subdivision's fuel purchases in the preceding month must be E85 for use in FFVs. A political subdivision is defined as a municipal corporation or special taxing district. This incentive expires January 1, 2015. (Reference Indiana Code 6-6-1.1-103, 8-14-2-8, and 36-1-2-13)
The Indiana House supports education related to the use of higher ethanol blends in non-flexible fuel vehicles, citing studies that show environmental and economic benefits of using higher ethanol blends. The House also encourages the U.S. Environmental Protection Agency to authorize the use of higher ethanol blends in non-flexible fuel vehicles. (Reference House Resolution 77, 2009)
Indiana has joined Iowa, Kansas, Michigan, Minnesota, Ohio, South Dakota, and Wisconsin in adopting the Energy Security and Climate Stewardship Platform Plan (Platform) which establishes shared goals for the Midwest region, including increased biofuels production and use. Specifically, the Platform sets the following goals:
The Platform also establishes a regional biofuels corridor program. The program directs state transportation, agriculture, and regulatory officials to develop a system of coordinated signage across the region for biofuels and advanced transportation fuels and to collaborate to create regional E85 corridors. The program requires standardized fuel product coding at fueling stations as well as increased education for retailers about converting existing fueling infrastructure to dispense E85.
E85 sellers, suppliers, distributors, manufacturers, and refiners are immune from civil liability for personal injury of property damage resulting from a person fueling any vehicle with E85 that is not a flexible fuel vehicle. This includes any vehicle equipped to operate when fueled entirely with E85. This immunity does not apply if an E85 seller, supplier, distributor, manufacturer, or refiner does not display all E85 warning signs federal or state laws require. (Reference Indiana Code 34-30-24)
The Indiana Department of Agriculture must work with automobile manufacturers to improve auto dealer and consumer awareness and labeling of E85 fuel, and must coordinate with the appropriate companies to include E85 fueling stations in updates of global positioning navigation software. (Reference Indiana Code 15-11-2-4)
A retailer who dispenses E85 must report to the Indiana Department of State Revenue the total number of gallons of E85 sold from a metered pump. (Reference Indiana Code 6-2.5-6 and 6-2.5-7-5)
E85 is a fuel blend nominally consisting of 85% ethanol and 15% gasoline by volume that meets ASTM specification D5798. (Reference Indiana Code 6-6-1.1-103)
As part of the Indiana Greening the Government Initiative, all fleet vehicles based in Indianapolis that are capable of using E85 must operate using E85 fuel whenever possible. Use of other biobased fuels and oils is also encouraged. (Reference Executive Order 05-21, 2005)
Whenever possible, governmental entities and state educational institutions must fuel diesel vehicles with biodiesel blends containing at least 2% biodiesel (B2), gasoline vehicles with mid-level ethanol blends between 20% and 73%, and flexible fuel vehicles with E85. This requirement does not apply if such blends are prohibited under federal regulations or have not been approved by the vehicle manufacturer. Additional exemptions apply. (Reference Indiana Code 5-22-5-8 and 21-31-9-3)
The Indiana Economic Development Corporation may designate an area as a certified technology park if certain criteria are met, including a commitment from at least one business engaged in a high technology activity that creates a significant number of jobs. The establishment of high technology activities and public facilities within a technology park serves a public purpose and benefits the public's general welfare by encouraging investment, job creation and retention, and economic growth and diversity. High technology activities include advanced vehicles technology, which is any technology that involves electric vehicles, hybrid electric vehicles, or alternative fuel vehicles, or components used in the construction of these vehicles. (Reference Indiana Code 36-7-32)
An individual may place alternative fuel into the fuel tank of a motor vehicle only if the vehicle has a valid alternative fuel decal affixed to the front windshield or the individual has submitted an application for a decal within the last 30 days. All heavy-duty AFVs and light-duty AFVs that public or private utilities own require vehicle decals. The cost of the decal varies according to vehicle type and the gross vehicle weight rating. The annual fee may be prorated if the vehicle is newly purchased, registered in Indiana, or converted to operate using an alternative fuel. (Reference Indiana Code 6-6-2.1-203 through 6-6-2.1-206)
Point of Contact
Fuel Tax Section
Indiana Department of Revenue
Phone: (317) 615-2630
http://www.in.gov/dor