South Carolina Hydrogen Laws and Incentives

State Incentives

Alternative Fuel and Advanced Vehicle Tax Credit

A state income tax credit equal to 20% of the federal fuel cell, advanced lean burn, hybrid electric vehicle, and alternative fuel vehicle credits is available to South Carolina resident taxpayers who are eligible for, and claim, the federal credits. If the amount of the credit exceeds the taxpayer's liability for the applicable tax year, any unused portion of the credit may be carried forward and claimed for up to five years. The state tax credit is calculated without regard to the phase out period limits of Internal Revenue Code Section 30(B)(f). (Reference South Carolina Code of Laws 12-6-3377)

Hydrogen Infrastructure Development Grants

The South Carolina Hydrogen Infrastructure Development Fund is created to fund grants administered by the South Carolina Research Authority to promote the development and deployment of hydrogen production, storage, distribution, and dispensing infrastructure and related products and services that enable the growth of hydrogen and fuel cell technologies in the state. Taxpayers may receive a 25% credit against state income taxes, insurance premium taxes, and certain license fees for contributions made to the fund. (Reference South Carolina Code of Laws 11-46)

State Laws and Regulations

Hydrogen and Fuel Cell Tax Exemption

The following are exempt from state sales tax: 1) any device, equipment, or machinery operated by hydrogen or fuel cells; 2) any device, equipment, or machinery used to generate, produce, or distribute hydrogen and designated specifically for hydrogen or fuel cell applications; and 3) any device, equipment, or machinery used predominantly for manufacturing, or research and development involving hydrogen or fuel cell technologies. (Reference South Carolina Code of Laws 12-36-2120)

State Agency Preference for Alternative Fuel and Advanced Vehicles

Preference in purchasing state motor vehicles must be given to hybrid, plug-in hybrid, biodiesel, hydrogen, fuel cell, or flexible fuel vehicles when the performance, quality, and anticipated life cycle costs are comparable to other available motor vehicles. (Reference South Carolina Code of Laws 1-11-310)

State Agency Alternative Fuel Use Requirement

Whenever practical and economically feasible, all state agencies operating alternative fuel vehicles are required to use alternative fuels in those vehicles. Private businesses are encouraged to increase the use of alternative fuels in the state. (Reference Executive Order 2001-35)