Kentucky Propane Laws and Incentives
State Incentives
Alternative Fuel Research, Development, and Promotion
The Kentucky New Energy Ventures (KNEV) program, established by the Kentucky Alternative Fuel and Renewable Energy Fund Program, provides project funding 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 offered by Kentucky's alternative fuel and renewable energy industry. (Reference Kentucky Revised Statutes 154.20-410 and 154.20-415)
Alternative Fuel and Vehicle Promotion
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 has implemented a number of projects to promote the use of AFVs and establish alternative fuel infrastructure in Kentucky.
State Laws and Regulations
Vehicle Acquisition Priorities and Alternative Fuel Use Requirement
The Finance and Administration Cabinet (Cabinet) is required to develop a strategy to replace at least 50% of commonwealth motor fleet light-duty vehicles with energy-efficient vehicles including hybrid electric vehicles, fuel cell vehicles, 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)
Liquefied Petroleum Gas (LPG) Excise Tax Exemption
LPG is exempt from the state excise tax when it is used to operate motor vehicles on public highways, given that those vehicles are equipped with carburetion systems approved by the Kentucky Natural Resources and Environmental Protection Cabinet. (Reference Kentucky Revised Statutes 234.321)
