The list below contains summaries of all Kentucky incentives and laws related to Ethanol.
Qualified ethanol producers are eligible for an income tax credit of $1.00 per gallon of corn- or cellulosic-based ethanol that meets ASTM specification D4806. The total credit amount available for all corn and cellulosic ethanol producers is $5 million for each fuel type in each taxable year. Unused ethanol credits from one ethanol-based cap, such as corn, may be applied to another ethanol-based cap, such as cellulosic, in the same taxable year. Unused credits may not be carried forward. (Reference Kentucky Revised Statutes 141.422 and 141.4242 to 141.4248)
The Kentucky Economic Development and Finance Authority (KEDFA) provides tax incentives to construct, retrofit, or upgrade an alternative fuel production or gasification facility that uses coal or biomass as a feedstock. Tax incentives are also available for energy-efficient alternative fuel production facilities and for up to five alternative fuel production facilities that use natural gas or natural gas liquids as a feedstock. Energy-efficient alternative fuels are defined as homogeneous fuels that are produced from processes designed to densify feedstocks such as coal, waste coal, or biomass resources, and have an energy content that is greater than the feedstock. The incentives may consist of: 1) a refund of up to 100% of the state sales tax paid on the purchase of personal property used to construct the facility; 2) a credit of up to 100% of an approved company's state income tax and limited liability entity tax that the project generates; 3) up to 4% of the wage assessment of employees whose jobs were created as a result of the construction, retrofit, upgrade, or operation of a qualified facility; and 4) a credit for up to 80% of the severance tax paid for coal, natural gas, or natural gas liquids used as a feedstock.
The incentives expire at the time of receipt of the authorized amount or 25 years from activation of the project, whichever occurs first. Approved companies may recover up to 50% of their capital investment via the authorized tax incentives. The minimum capital investment for incentive eligibility is $25 million for an alternative fuel or gasification facility that uses biomass as the primary feedstock; $100 million for an alternative fuel or gasification facility that uses coal, oil shale, or tar sands as the primary feedstock; $25 million for an energy-efficient alternative fuel facility; and $1 million for a facility that uses natural gas or natural gas liquids as the primary feedstock.
(Reference Kentucky Revised Statutes 154.27-010 to 154.27-090)
Point of Contact
Don Goodin
Kentucky Economic Development Finance Authority
Phone: (502) 564-4554
Fax: (502) 564-7697
don.goodin@ky.gov
http://www.thinkkentucky.com/
The Kentucky New Energy Ventures (KNEV) program provides grants and investments to companies for research, development, and commercialization of alternative fuels and renewable energy. Specifically, KNEV is designed to: 1) grow Kentucky-based alternative fuel and renewable energy companies to promote commonwealth-wide, innovation-driven economic growth; 2) stimulate private investment in Kentucky-based alternative fuel and renewable energy enterprises; 3) expand the alternative fuel and renewable energy knowledge base, talent force, and industry in Kentucky; 4) develop an alternative fuel and renewable energy resource network to build the technical and business capacity of entrepreneurs through informal and formal strategic support; and 5) build commonwealth-wide awareness of the economic development opportunities Kentucky's alternative fuel and renewable energy industry offers. Alternative fuels include biodiesel, ethanol, cellulosic ethanol, synthetic natural gas, fuels produced from coal, and other fuels produced from a renewable or sustainable source. To be eligible, a business must have its principle base of business or at least 51% of the property and payroll in the commonwealth. Additional eligibility requirements apply. (Reference Kentucky Revised Statutes 154.20-410 and 154.20-415)
The Kentucky Department for Energy Development and Independence (Department) encourages the responsible use of transportation fuels by supporting academic research, public education, and collaborative partnerships involving alternative fuels and alternative fuel vehicles (AFVs). The Department facilitates projects that promote the use of AFVs and establish alternative fuel infrastructure in Kentucky.
Point of Contact
Tim Hughes
Director, Division of Biofuels
Kentucky Department for Energy Development and Independence
Phone: (502) 564-7192
Fax: (502) 564-7406
timd.hughes@ky.gov
http://energy.ky.gov/biofuels/Pages/default.aspx
The Executive Task Force on Biomass and Biofuels Development must facilitate the development of a sustainable biomass and biofuels industry in Kentucky. The Executive Task Force Final Report recommends key strategic actions to develop the industry, including identifying a single agency to coordinate development efforts, developing policies to mitigate demand and supply risks, ensuring the industry's sustainability, and developing capitalization mechanisms. (Reference Executive Order 2009-817, 2009)
The Kentucky Finance and Administration Cabinet (Cabinet) must develop a strategy to replace at least 50% of commonwealth motor fleet light-duty vehicles with energy-efficient vehicles including hybrid electric, advanced lean burn, fuel cell, and alternative fuel vehicles. The Cabinet must also develop a strategy to increase the use of ethanol, biodiesel, and other alternative fuels in commonwealth motor vehicle fleets. The Cabinet must report targeted vehicle and fuel usage amounts annually. (Reference Kentucky Revised Statutes 45A.625)
The Governor's Office of Energy Policy (Office) oversees the development and implementation of Kentucky's comprehensive energy strategy. Specifically, the Office must develop and implement a strategy for the production of alternative transportation fuels and synthetic natural gas from fossil energy resources and biomass resources, including biodiesel and ethanol. The commonwealth energy plan, Intelligent Energy Choices for Kentucky's Future, was developed in 2008 and proposes seven strategies to support a renewable and efficiency portfolio standard, and to develop an alternative transportation fuel standard and set fuel production goals. (Reference Kentucky Revised Statutes 152.720)