Utah Propane Laws and Incentives
State Incentives
High Occupancy Vehicle (HOV) Lane Exemption
Vehicles with clean fuel license plates are authorized to travel in HOV lanes regardless of the number of occupants, to the extent authorized or permitted by federal law or federal regulation. The clean fuel plate must be purchased from a Utah Motor Vehicles office for a fee of $15. Vehicle owners must first obtain a C Plate permit from the Utah Department of Transportation. To be eligible for a clean fuel license plate, a vehicle must meet the definition of a clean fuel vehicle as defined in Utah Code 59-13-102. This incentive expires December 31, 2010. (Reference Utah Code 41-1a-418, 41-1a-1211, 41-6a-702 and 59-13-102)
Alternative Fuel Vehicle (AFV) and Fueling Infrastructure Grants and Loans
The Utah Clean Fuels and Vehicle Technology Grant and Loan Program, funded through the Clean Fuels and Vehicle Technology Fund, provides grants and loans to assist businesses and government entities in covering: 1) the cost of converting a vehicle to operate on clean fuels; 2) the incremental cost of purchasing an Original Equipment Manufacturer (OEM) clean fuel vehicles; and 3) the cost of retrofitting diesel vehicles with U.S. Environmental Protection Agency verified closed crankcase filtration devices, diesel oxidation catalysts, and/or diesel particulate filters. The Clean-Fuels Grant and Loan Program also provides loans for the cost of converting a vehicle to operate on a clean fuel, for the purchase of OEM clean fuel vehicle, and for the purchase of fueling equipment for public/private sector business and government vehicles. Finally, the program can provide grants and loans to serve as matching funds for federal and non-federal grants for the purpose of vehicles to operate on a clean fuel, purchasing OEM clean fuel vehicles, or retrofitting diesel vehicles. The program does not support E85 or biodiesel projects. (Reference Utah Code 19-1-401 through 19-1-405)
Clean Fuel Vehicle Tax Credit
The state provides an income tax credit for 50% of the incremental cost (up to $3,000 maximum) of a clean fuel vehicle built by an Original Equipment Manufacturer (OEM) and/or an income tax credit for 50% of the cost (up to $2,500 maximum) of converting the vehicle to operate on an alternative fuel for vehicles purchased between January 1, 2001 and January 1, 2009, and registered in Utah. If not previously used, the tax credit may be claimed on used vehicles. Tax credits are available for businesses and individuals, may be carried forward up to five years, and are not available for hybrid electric vehicles. Documentation must be provided as described in the Utah state tax form TC-40V. For vehicles purchased after January 1, 2009, the credit amount for OEM compressed natural gas vehicles registered in Utah is 35% of the vehicle purchase price or $2,500, whichever is less; other new clean fuel vehicles may be eligible for a credit of up to $750. The credit for conversions remains the same as for pre-2009 purchases. Furthermore, hybrid-electric vehicles that meet required air quality and fuel economy standards are eligible. This incentive expires December 31, 2013. (Reference Utah Code 59-7-605 and 59-10-1009)
Alternative Fuel Vehicle (AFV) Parking Incentive - Salt Lake City
Salt Lake City has a free metered parking program for Green Vehicles, which are vehicles that qualify for a Utah Clean Fuel license plate by meeting the definition of a clean fuel vehicle as defined by Utah Code 19-1-402, or that qualify for a Salt Lake City Green Vehicle parking permit by being a top performer in regards to city fuel economy or emissions. To park free at meters, vehicles must display a Utah Clean Fuel license plate, or Green Vehicle parking permit. Green Vehicle parking permits are available from the Salt Lake City Transportation Division for vehicles meeting at least one of the following criteria: 1) achieve a city fuel economy of at least 41 miles per gallon as determined by the U.S. Environmental Protection Agency (EPA), or 2) achieve an EPA Green Vehicle Guide pollution score of at least eight for Utah. (Reference Salt Lake City Code 12.56.205)
Incentive for Airport Alternative Fuels Use
The Salt Lake City Department of Airports provides incentives to commercial ground transportation providers who purchase and operate clean fuel vehicles that exclusively operate on approved clean fuels (as designated by Utah Code 59-13-102). Eligible vehicles are those that operate on compressed natural gas, propane, hydrogen, electricity, or hybrid electric vehicles. The incentives are in the form of a credit against ground transportation fees. Incentive credit amounts are $2,500 for each Original Equipment Manufacturer vehicle or certified vehicle converted to operate on an alternative fuel. (Reference Salt Lake City Department of Airports Clean Fuel Policy Number 10.07.100)
State Laws and Regulations
Alternative Fuels Tax
The tax imposed on clean special fuels used to operate motor vehicles, including propane and electricity, is 3/19 of the rate of $0.0245 which is imposed on traditional motor fuels. The tax on compressed natural gas is $0.085 per gasoline gallon equivalent; this rate will be modified proportionally with any changes to the traditional motor fuel rate. Vehicles that operate on special fuels and have a gross vehicle weight rating of more than 26,000 pounds, or have more than three axels are required to obtain a special fuel user permit from the State Tax Commission. The Revenue and Tax Code provides for a reduction of motor and special fuel taxes if the motor or special fuel is already taxed by the Navajo Nation. Retailers, wholesalers, and suppliers of special fuel are eligible for a refund of the special fuel tax if dyed diesel fuel is mixed with special fuel and the mixed special fuel is returned to the refinery for re-refining. Documentation must be provided as described in the Utah state tax form TC-129. (Reference Utah Code 59-13-102, 59-13-201, 59-13-301, 59-13-303, 59-13-304, and 59-13-322)
Provision for Establishment of Alternative Fuel Use Mandate
The Utah Air Quality Board is authorized to mandate fleet vehicles to use clean fuels, if such a mandate is necessary in order to meet national air quality standards. (Reference Utah Code 19-2-105.3)
