Oregon Hybrid Electric Vehicle Laws and Incentives

State Incentives

Alternative Fuel Vehicle (AFV) and Hybrid Electric Vehicle (HEV) Tax Credit

The Oregon Department of Energy offers two income tax credits for AFVs and HEVs, one for residents and one for business owners. Oregon residents are eligible for a Residential Energy Tax Credit, which provides credits of up to $1,500 toward the purchase of qualified AFVs and HEVs; currently, flexible fuel vehicles are not eligible. A credit of up to $750 is also available for the cost of converting vehicles to operate on an alternative fuel.

Oregon business owners who invest in new HEVs for business use are eligible for a Business Energy Tax Credit of up to 35% of the incremental cost of the HEV. Business owners without an Oregon tax liability, non-profit organizations, and public entities may choose to "pass-through" or transfer their tax credit eligibility to a business or individual with an Oregon tax liability in exchange for a cash payment equal to the pass-through rate at the time of application. Business owners with a tax liability may also choose to transfer their tax credit.

(Reference Oregon Revised Statutes 316.116, 469.160-469.180, and 801.375)

State Laws and Regulations

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. It was determined that the three states 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.

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 vehicles, including school vehicles and commercial buses that are EVs or HEVs 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 House Bill 2001, 2009, and Oregon Revised Statutes 803.415 and 803.420)