Washington Incentives and Laws for Ethanol

The list below contains summaries of all Washington incentives and laws related to Ethanol.

State Incentives

Alternative Fuel Loans and Grants

The Washington Department of Commerce administers the Energy Freedom Program (Program) in consultation with other state agencies. The Program includes the Energy Freedom Account, which provides financial and technical assistance for bioenergy production, research, and market development, primarily in the form of loans used to convert farm products, organic wastes, cellulose and biogas into electricity, biofuel, and related co-products. The Program also includes the Green Energy Incentive Account, which provides financial assistance for alternative fueling infrastructure along Interstate corridors. As of March 2011, funds have yet to be appropriated for these accounts, which are set to expire after June 30, 2016. (Reference Revised Code of Washington 43.325)

Biofuels Distribution Tax Exemption

Fuel delivery vehicles, machinery, equipment, and related services that are used for the retail sale or distribution of biodiesel blends or E85 motor fuel are exempt from state retail fuel sales and use taxes until July 1, 2015. (Reference Revised Code of Washington 82.08.955 and 82.12.955)

Biofuels Tax Deduction

A business and occupation tax deduction is available for the sale or distribution of biodiesel or E85 motor fuel. This deduction is available until July 1, 2015. (Reference Revised Code of Washington 82.04.4334)

Biofuels Production Tax Exemption

Qualifying buildings, equipment, and land used in the manufacturing of alcohol fuel, biodiesel, or biodiesel feedstocks are exempt from state and local property and leasehold excise taxes for a period of six years from the date the facility or addition to the existing facility becomes operational. This incentive expires after December 31, 2015. (Reference Revised Code of Washington 82.29A.135 and 84.36.635)

Utility/Private Incentives

Clean and Efficient Fleet Assistance

The Puget Sound Clean Cities Coalition, in partnership with the Puget Sound Clean Air Agency, offers the Evergreen Fleets program, a comprehensive greening plan and certification system for fleets. Evergreen Fleets provides fleet managers with tools to help "green" public and private fleets, reduce pollution, and save money. Evergreen Fleets provides a step-by-step guide to identify the most effective way for fleet managers to green their fleets, including buying greener vehicles, switching to cleaner fuels, or improving fleet efficiency.

Biofuel Volume Rebate Program - Propel Fuels

Propel Fuels offers a rebate to qualified fleet customers for monthly purchases of more than 500 gallons of biodiesel blends and E85. Fleet customers must purchase the fuel directly from Propel public retail locations using the Propel CleanDrive Wright Express fleet card. The program offers a rebate of $0.03 per gallon for purchases of less than 1,000 gallons of biofuel per month, and $.05 per gallon for purchases of 1,000 gallons or more per month. The rebate is applied at the end of each monthly billing cycle.

Laws and Regulations

Renewable Fuel Standard

At least 2% of all diesel fuel sold in Washington must be biodiesel or renewable diesel. This requirement will increase to 5%, 180 days after the Washington State Department of Agriculture (WSDA) determines that in-state feedstocks and oil-seed crushing capacity can meet a 3% requirement. Renewable diesel is defined as a diesel fuel substitute produced from non-petroleum renewable sources, including vegetable oils and animal fats, meets the federal registration requirements for fuels and fuel additives and ASTM specification D975.

Additionally, at least 2% of the total gasoline sold in the state must be denatured ethanol. The ethanol requirement may be increased if the Washington Department of Ecology determines that this increase would not jeopardize continued attainment of federal Clean Air Act standards and WSDA determines that the state can economically support the production of higher ethanol blends.

All state agencies with jurisdiction over renewable fuel infrastructure, specifically storage, blending, and dispensing equipment, are required to expedite related application and permitting processes. The governor may suspend these requirements by Executive Order if the standard is temporarily technically or economically infeasible, or poses a significant risk to public safety.

(Reference Revised Code of Washington 19.112.010 and 19.112.110-19.112.180)

Provision for Alternative Fuels Corridor Pilot Projects

The Washington Department of Transportation may enter into partnership agreements with other public and private entities to use land for alternative fuel corridor pilot projects. Minimum requirements apply and these agreements are subject to funding availability. (Reference Revised Code of Washington 47.38.070)

Biofuel Blend Dispenser Labeling Requirement

All motor fuel pumps dispensing alcohol blended gasoline must be labeled with the alcohol product name (e.g., ethyl alcohol) and the alcohol content. The statement must be posted in letters measuring at least half an inch high. Pumps dispensing ethanol or biodiesel blends must have a label that specifies the percentage of ethanol or biodiesel present in the fuel. Pumps dispensing biodiesel blends of 5% (B5) or less must include a label stating that the fuel "may contain up to five percent biodiesel." (Reference Revised Code of Washington 19.112.020, and Washington Administrative Code 16-657-040)

Biofuel Quality Program

The Washington State Department of Agriculture (WSDA) Biofuels Standards Program tests and assesses biofuel quality and quantity to resolve any quality issues before the product reaches the consumer. WSDA is currently sampling biofuel throughout the state on a quarterly basis, monitoring and tracking the quality of biofuel, and working with producers and manufacturers to help supply the highest biofuel quality fuel available to consumers. The goal of the program is to create equity in the biofuel marketplace for refiners, suppliers, distributors, and retailers, and protect consumers. (Reference Revised Code of Washington 19.112)

E85 Definition

E85 motor fuel is defined as an alternative fuel that is a blend of ethanol and hydrocarbon, of which the ethanol portion is 75-85% denatured fuel ethanol by volume and complies with the most current ASTM specification D5798. (Reference Revised Code of Washington 19.112.010 and 82.04.4334)

Alternative Fuel Use Requirement

Effective June 1, 2015, all state and local government agencies must use 100% biofuels or electricity to operate all publicly owned vehicles. To phase in this requirement, all state agencies must achieve 40% biofuel or electricity use by June 1, 2013. To allow the motor vehicle fuel needs of state and local government to be satisfied by Washington-produced biofuels, the Washington Department of General Administration and local governments may contract in advance and execute contracts with public or private producers and suppliers for the purchase of appropriate biofuels. (Reference Revised Code of Washington 43.19.647-43.19.648)

Clean Fuel Vehicle Purchasing Requirement

At least 30% of all new vehicles purchased through a state contract must be clean fuel vehicles, based on the Washington Department of Ecology definitions. The percentage of clean fuel vehicles purchased must increase at the rate of 5% each year. Dedicated clean fuel vehicles are preferred. In the event that dedicated clean fuel vehicles are not available or would not meet operation requirements, conventionally powered vehicles may be converted to operate on clean fuel or dual-fuel use. (Reference Revised Code of Washington 43.19.637)

Biofuels Production and Distribution Contracts

Conservation districts and public development authorities may enter into crop purchase contracts to produce, sell, and distribute biodiesel produced from Washington feedstocks, cellulosic ethanol, and cellulosic ethanol blended fuels. Additionally, municipal utilities and public utility districts may produce and distribute biodiesel, ethanol, and ethanol blended fuels, as well as enter into crop purchase contracts for the purpose of producing biodiesel produced from Washington feedstocks, cellulosic ethanol, and cellulosic ethanol blended fuels for utility and public use. (Reference Revised Code of Washington 35.21.465, 35.92.440, 54.04.190, and 89.08.570)

State Emissions Reductions Requirements

Washington must limit greenhouse gas (GHG) emissions to achieve the following reductions:

• By 2020, reduce overall GHG emissions in the state to 1990 levels;
• By 2035, reduce overall GHG emissions in the state to 25% below 1990 levels; and
• By 2050, reducing overall emissions to 50% below 1990 levels, or 70% below the state's expected emissions that year.

To reach these goals, the state will ensure that vehicles sold in the state meet stringent emissions standards; work with farmers, entrepreneurs, fuel distributors, and retailers to ensure that biofuel feedstocks are grown in Washington; ensure that refiners, blenders, and distributors of biofuels create jobs in the state; and strive to make it possible for the public to purchase fuel blends that reduce dependence on imported oil. The Washington Department of Ecology developed a comprehensive plan to reduce the state's GHG emissions.

(Reference Revised Code of Washington 70.235.020 and Executive Order 07-02, 2007)

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Content Last Updated: 07/14/2011