Colorado Incentives and Laws

Last Updated August 2009

Colorado is the home of the Denver Metro (www.lungcolorado.org/CleanCities.htm), Northern Colorado (www.northcolocleancities.com), and Southern Colorado Clean Cities Coalitions (http://southern.cleancitiescolorado.org/). Coordinator contact information is listed in the Points of Contact section.

State Incentives

Electric Vehicle (EV) Charging Infrastructure Grants

Grants are available to local governments for the installation of EV charging stations. Grants are prioritized based on the local government's commitment to energy efficiency. (Reference Senate Bill 075, 2009 and Colorado Revised Statutes 24-38.5-102 and 24-38.5-103)

Truck Emissions Reduction and Fuel Efficiency Grants

The Green Truck Grant Program was established by the Colorado Governor's Energy Office to provide grants to owners of commercial trucks used in interstate commerce to reduce emissions and energy usage. Reimbursements of up to 25% of overall costs may be made to qualified recipients who purchase or install fuel-efficient technologies and emission-control devices approved by the U.S. Environmental Protection Agency's (EPA) SmartWay Transport Partnership, or any successor program, to reduce fuel consumption and emissions of greenhouse gases and other harmful air pollutants from trucks. Individual recipients may not receive more than $50,000, and the total of all reimbursements under this program may not exceed $500,000 per fiscal year.

Additionally, grants of up to $5,000 per qualified recipient are available for retiring and scrapping 1989 or older model year trucks that have been documented to have been in use for at least 10,000 miles during the calendar year preceding the recipient's grant application, and which are donated to an established auto parts or scrap metal recycler that meets state and U.S. EPA recycling requirements. The total of all reimbursements under this program may not exceed $250,000 per fiscal year. (Reference House Bill 1298, 2009, and Colorado Revised Statutes 42-1-301 to 42-1-305)

Biofuels Research Grants

The Bioscience Discovery Evaluation Grant Program, administered by the Colorado Office of Economic Development, provides grants to research institutions for biofuels research projects. Biofuels research is defined as the use of microorganisms, specialized proteins, or thermal processes to develop biofuels and the related processes that make traditional manufacturing of energy cleaner and more efficient. Biofuel is defined as a biologically based fuel product developed from plant matter or other biological material, including renewable agricultural sources. Grant limits, matching funds, and other eligibility requirements apply. (Reference Colorado Revised Statutes 24-48.5-108)

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

An income tax credit is available from the Colorado Department of Revenue for a motor vehicle titled and registered in Colorado that uses or is converted to use an alternative fuel, is a hybrid vehicle, or has its power source replaced with one that uses an alternative fuel. For vehicles purchased or converted between January 1, 2007, and January 1, 2010, the percentage of the actual or incremental cost that may be claimed as a credit is as follows:

Beginning January 1, 2010, tax credits are based on specified state-defined vehicle categories as follows:

These credits are capped at $6,000 for the following: AFVs, AFV conversions, HEVs, plug-in hybrid electric vehicles (PHEVs), PHEV conversions, idle-reduction technologies, and power source replacements; there is no cap on natural gas vehicle conversions. Between 2012 and 2016, the cap on PHEV conversions increases to $7500. Individuals who claimed a tax credit in previous years for the purchase of a HEV, Model Year 2004 or newer, may be eligible to claim an additional credit for the conversion of the same vehicle to a PHEV. For credits claimed in tax years 2010 and 2011, Category 3 and Category 4 vehicles that permanently displace vehicles or power sources at least 12 years old are eligible for 1.25 times the credit percentages displayed up to 100%. Additional information is also available from the Governor's Energy Office.

(Reference House Bill 1331, 2009, and Colorado Revised Statutes 39-33-101 to 39-33-106)

Point of Contact

Division of Taxation
Colorado Department of Revenue
Phone (303) 238-7378
http://www.revenue.state.co.us/main/home.asp

Alternative Fuel Vehicle (AFV) and Hybrid Electric Vehicle (HEV) Rebate

The Colorado Department of Revenue offers a rebate for the purchase of an AFV, HEV, or for the conversion of a vehicle to operate using an alternative fuel. Vehicles must be owned by the State of Colorado, a political subdivision of the state, or a tax-exempt organization, and be used in connection with the official activities of the entity. The rebate is a percentage of the incremental cost if used toward purchasing a new vehicle, or is a percentage of the conversion cost if used towards the cost of converting a vehicle to operate using an alternative fuel.

For costs incurred between July 1, 2006, and July 1, 2009, the rebate percentages are as follows:

For an AFV purchase or conversion that permanently replaces a motor vehicle or power source that is at least 10 years old, the percentage specified in the table above is doubled, up to a maximum of 100% of the incremental or conversion cost.

For costs incurred between July 1, 2009, and July 1, 2015, the rebate percentages are as follows:

Each qualified entity is limited to $350,000 per state fiscal year in total rebates paid.

(Reference House Bill 1331, 2009, and Colorado Revised Statutes 39-33-101 through 39-33-106)

Point of Contact

John Doty
AFV/Hybrid Taxes and Rebates
Colorado Department of Revenue
Phone (303) 205-8211
jdoty@spike.dor.state.co.us
http://www.revenue.state.co.us/mv_dir/home.asp

Alternative Fuel Infrastructure Tax Credit

For tax years beginning prior to January 1, 2011, the Colorado Department of Revenue offers an income tax credit for the cost of construction, reconstruction, or acquisition of an alternative fueling facility that is directly attributable to the storage, compression, charging, or dispensing of alternative fuels to motor vehicles. The credit value is 35% of the cost if claimed during the 2009 tax year, and 20% of the cost if claimed during the 2010 or 2011 tax year.

For an alternative fueling facility that will be generally accessible for use by the public, in addition to the person claiming the credit, the percentages specified above will be multiplied by 1.25. If at least 70% of the alternative fuel dispensed annually is derived from a renewable energy source for a period of 10 years, the credit percentages specified above will be multiplied by 1.25. Certification for the percentage of renewable energy must be presented, as requested, to the Department of Revenue. The credit has a maximum value of $400,000 in any consecutive five-year period for each fueling facility. For more information about this credit, see the Colorado Department of Revenue's Alternative Fuel Income Tax Credits Web site.

(Reference Colorado Revised Statutes 39-22-516)

Point of Contact

Division of Taxation
Colorado Department of Revenue
Phone (303) 238-7378
http://www.revenue.state.co.us/main/home.asp

Low Emission Vehicle (LEV) Sales Tax Exemption

Vehicles, vehicle power sources, or parts used for converting a vehicle power source, including but not limited to wiring, fuel lines, engine coolant system, fuel storage containers, fuel control system, and other components associated with reducing the emissions characteristics of an engine or motor, certified to federal LEV standards or better are exempt from state sales tax. This exemption applies to vehicles, power sources, or parts for vehicles over 10,000 pounds gross vehicle weight rating. (Reference Colorado Revised Statutes 39-26-719)

State Laws and Regulations

Greenhouse Gas (GHG) Emissions Reductions

The State of Colorado has set goals to reduce GHG emissions by 20% below 2005 values by 2020 and by 80% below 2005 values by 2050. The Colorado Department of Public Health and Environment (CDPHE) is directed to develop regulations to submit to its Air Quality Control Commission that mandate reporting of GHG emissions from all major sources. CDPHE must plan for performing updates to the state's GHG inventory and identify and evaluate the benefits and impediments to measures designed to reduce tailpipe emissions from light-duty vehicles, including the utility and availability of alternative fuel vehicles. Additionally, CDPHE must develop a proposal for reducing net GHG emissions from the state's transportation sector. (Reference Executive Order D004 08 (PDF 24 KB)) Download Adobe Reader

Low-Speed Electric Vehicle (EV) Access to Roadways

A low-speed EV is a self-propelled vehicle using electricity as its primary propulsion method, has at least three wheels in contact with the ground, does not use handlebars to steer, and meets manufacturer requirements as defined in Title 49 of the Code of Federal Regulations, section 565. A low-speed EV may be operated only on a roadway with a speed limit of 35 miles per hour (mph) or less; a low-speed EV may directly cross a roadway with a speed limit greater than 35 mph.

A Class B low-speed EV is defined as a low-speed EV which is capable of traveling at greater than 25 mph but less than 45 mph and may be operated only on a roadway with a speed limit of 45 mph or less; a Class B low-speed EV may directly cross a roadway with a speed limit greater than 45 mph. Neither a low-speed EV nor a Class B low-speed EV may be operated on a limited-access highway. The Colorado Department of Revenue may not register or issue a title for a Class-B low-speed EV until after the U.S. Department of Transportation has adopted a federal motor vehicle safety standard for low-speed EVs that authorizes operation at greater than 25 mph but less than 45 mph.

Low-speed EVs may not be sold or offered for sale unless they comply with state vehicle safety requirements.

(Reference Senate Bill 075, 2009, and Colorado Revised Statutes 12-6-120, 42-1-102, 42-4-109.5, 42-4-109.6)

Clean Energy Development Authority

Clean Energy Development AuthorityThe Colorado Clean Energy Development Authority may issue bonds to finance projects that involve the production, transportation, and storage of clean energy. Clean energy is defined as fuels that are manufactured by, and energy that is derived from sources including but not limited to the following: biodiesel; biomass resources such as biogas, agricultural or animal waste, landfill gas, and anaerobically digested waste biomass; biomass resources that do not include energy generated by use of fossil fuel; fuel cells that do not use fossil fuels; and zero-emissions generation technology, including emission of carbon dioxide, with long-term production potential. (Reference Colorado Revised Statutes 40-9.7)

Promulgation of Renewable Fuel Storage Tank Regulations

The Colorado Division of Oil and Public Safety is responsible for enforcing rules concerning the placement of underground and aboveground storage tanks that contain renewable fuel. These rules must be promulgated so that the process of obtaining a permit for an underground storage tank that contains renewable fuel is more efficient and affordable. For the purpose of this regulation, a renewable fuel is a motor vehicle fuel that is produced from plant or animal products or wastes, as opposed to fossil fuel sources. (Reference Colorado Revised Statutes 8-20.5-202 and 8-20.5-302)

Alternative Fuel Use and Vehicle Acquisition Requirement

The Executive Director of the Colorado Department of Personnel has adopted a policy that requires all state-owned diesel vehicles and equipment to be fueled with a fuel blend of 20% biodiesel and 80% petroleum diesel (B20), subject to the availability of the fuel and so long as the price differential is not greater than $0.10 more per gallon as compared to conventional diesel. Biodiesel is defined as fuel composed of mono-alkyl esters of long chain fatty acids derived from plant or animal matter that meets ASTM specifications and that is produced in Colorado.

Additionally, the Executive Director has adopted a policy to increase the utilization of alternative fuels and establish objectives to increase utilization for each succeeding year. In 2009, the Executive Director must purchase flexible fuel vehicles or hybrid electric vehicles, subject to availability, unless the incremental cost of the vehicle is more than 10% greater than the cost of comparable conventional vehicles. Beginning on January 1, 2010, the Executive Director must purchase motor vehicles that operate on compressed natural gas (CNG), subject to the availability of vehicles and adequate fueling infrastructure. If purchases of CNG vehicles are not possible due to the incremental cost being more than 10%, the Executive Director must purchase another type of flexible fuel or hybrid electric vehicle, again subject to availability and incremental costs. The Executive Director may adopt a policy to allow some vehicles to be exempt from this requirement.

(Reference Senate Bill 092, 2009, Executive Order D0012 07 (PDF 31KB) and Colorado Revised Statutes 24-30-1104) Download Adobe Reader

Point of Contact

Art Hale
Colorado State Fleet Manager
Colorado Dept of Personnel and Administration, Division of Central Services, State Fleet Management
Phone (303) 866-5531
Fax (303) 866-5511
art.hale@state.co.us
http://www.colorado.gov/dpa/dcs/

Alternative Fuel Definition

Alternative fuel is defined as compressed natural gas, propane, ethanol, or any mixture of ethanol containing 85% or more ethanol by volume with gasoline or other fuels, electricity, or any other fuels, which may include, but are not limited to, clean diesel and reformulated gasoline, so long as these other fuels make comparable reductions in carbon monoxide emissions and brown cloud pollutants as determined by the air quality control commission. Alternative fuel does not include any fuel product that contains or is treated with methyl tertiary butyl ether (MTBE). (Reference Colorado Revised Statutes 25-7-106.8)

Alternative Fuel Vehicle (AFV) Registration

Upon registering a motor vehicle with the Colorado Department of Revenue Division of Motor Vehicles, the vehicle owner must report the types of alternative fuel used to operate the vehicle and whether the vehicle is dual-fueled or dedicated to one alternative fuel. Forms provided by the Department of Revenue for the purpose of registering motor vehicles must include space for the following fuel types: gasoline, diesel, propane, electricity, natural gas, methanol or M85, ethanol or E85, biodiesel, and other. (Reference Colorado Revised Statutes 42-3-113)

Alternative Fuel Vehicle (AFV) Weight Limit Exemption

Gross vehicle weight rating limits for AFVs are 1,000 pounds greater than those for comparable conventional vehicles, as long as the AFVs operate using an alternative fuel or both alternative and conventional fuel, when operating on a highway that is not part of the interstate system. (Reference Colorado Revised Statutes 42-4-508)

Alternative Fuels Tax and Vehicle Decal

Fuel tax exemptions are granted for compressed natural gas (CNG) and liquefied petroleum gas (LPG) vehicle owners. Owners of CNG and LPG fueled vehicles are required to purchase an annual tax decal from the Colorado Department of Revenue or a decal vendor as follows:

All CNG and LPG vehicles must display a current fuel tax decal. Non-profit transit agencies are exempt from the fuel tax.

(Reference Colorado Revised Statutes 39-27-102.5)

Gasoline Gallon Equivalent Definition

The term gasoline gallon equivalent is defined to equate the energy content of any motor fuel, including alternative fuels, to that of a gallon of gasoline. Any dispenser used for the sale of motor fuel in gasoline gallon equivalents must display gasoline gallon equivalents as the primary display information provided. (Reference Colorado Revised Statutes 8-20-232.5)

Idle Reduction Requirement - Denver

Idling of any vehicle for more than five minutes in any one-hour period is prohibited within the city and county of Denver. Exemptions apply for the following: when ambient outside air temperatures have been less than 20 degrees Fahrenheit for the previous 24 hours; current ambient outside air temperature are less than 10 degrees Fahrenheit. This requirement does not apply to emergency vehicles, vehicles engaged in traffic operations, vehicles being serviced, vehicles that must idle to operate auxiliary equipment, and vehicles that are idle due to traffic congestion. (Reference Revised Municipal Code, City and County of Denver, Section 4-43)

Idle Reduction Requirement - Aspen

Idling of any vehicle for more than five minutes within any one-hour period is prohibited in the City of Aspen. Exemptions apply for safety reasons and to maintain specified engine temperatures. Violators are subject to a penalty of up to $1,000 and/or one year imprisonment. (Reference City of Aspen Municipal Code 13.08.110)

Idle Reduction Requirement - Arapahoe County

The Arapahoe County Engine Idling Policy applies to all local government vehicles and requires that drivers do not allow any engine to idle for more than one minute (or 30 seconds for off-road equipment) at any time or for more than five minutes in any one-hour period. This requirement does not apply to vehicles for which idling is necessary, including official traffic control devices or signals, traffic or other required stops, safety or health, engine testing, or at the direction of law enforcement personnel. (Reference Arapahoe County Resolution 090-502, 2009)

Utilities/Private Incentives

Natural Gas Fuel Rate Reduction and Infrastructure Maintenance

Clean Energy Fuels offers services to the natural gas vehicle industry that include compressed natural gas (CNG) fueling station equipment maintenance, competitive fuel pricing for larger fleet customers, and alternative fuel vehicle financing. Clean Energy also operates public CNG fueling stations in Colorado.

Point of Contact

James Orsulak
Market Manager for Alternative Fuels
Clean Energy Fuels
Phone (303) 322-4600
Fax (303) 322-4644
jorsulak@cleanenergyfuels.com

Natural Gas Infrastructure Technical Assistance

Atmos Energy offers preliminary feasibility studies for compressed natural gas fueling stations and will assist with vendor selection on a case-by-case basis.

Point of Contact

Walter C. Miller
Energy Services Consultant
Atmos Energy
Phone (817) 303-2903
Fax (817) 303-2929
walter.c.miller@atmosenergy.com

Points of Contact:

NAME/EMAIL/TITLE	AGENCY	PHONE/FAX
Alicia Archibald Clean Cities Coordinator/Director	Southern Colorado Clean Cities Coalition	Phone:(719) 494-6592 Fax:
Natalia Swalnick Air Quality/Clean Cities Manager	Denver Metro Clean Cities Coalition	Phone:(303) 847-0271 Fax:(303) 377-1102
Robin Newbrey Riesberg Clean Cities Coordinator	Northern Colorado Clean Cities Coalition	Phone:(970) 689-4845 Fax:
Kay Kelly Project Manager	U.S. Department of Energy, Golden Office	Phone:(303) 275-6037 Fax:
Art Hale Colorado State Fleet Manager	Colorado Dept of Personnel and Administration, Division of Central Services, State Fleet Management	Phone:(303) 866-5531 Fax:(303) 866-5511
John Doty AFV/Hybrid Taxes and Rebates	Colorado Department of Revenue	Phone:(303) 205-8211 Fax:
Division of Taxation	Colorado Department of Revenue	Phone:(303) 238-7378 Fax:
Teresa Carrillo Commercial Vehicle Operations Manager	Colorado Department of Transportation	Phone:(303) 757-9716 Fax:(303) 757-9719
Stacey Simms Biofuels and Local Fuels Program Manager	Governor's Biofuels Coalition	Phone:(303) 866-2308 Fax:(303) 866-2930
James Orsulak Market Manager for Alternative Fuels	Clean Energy Fuels	Phone:(303) 322-4600 Fax:(303) 322-4644
Walter C. Miller Energy Services Consultant	Atmos Energy	Phone:(817) 303-2903 Fax:(817) 303-2929
Anna Friend Transportation Operations Specialist	U.S. General Services Administration	Phone:(303) 236-7221 Fax:(303) 236-7590