Nebraska Laws and Incentives

Listed below are the summaries of all current Nebraska laws, incentives, regulations, funding opportunities, and other initiatives related to alternative fuels and vehicles, advanced technologies, or air quality. You can go directly to summaries of:

State Incentives

Cellulosic Ethanol Investment Tax Credit

A qualified investor may receive a tax credit of up to 40% of an investment, up to $350,000, in a small business that is improving, researching, developing, or producing a proprietary product, process, or service related to cellulosic ethanol. A qualified investor is an individual, trust, or pass-through entity that meets certain requirements set by the Nebraska Department of Economic Development. An eligible small business must employ up to 25 individuals, be headquartered in Nebraska, and employ over half of its employees in the state or have over half of its total payroll paid or incurred in the state. Up to $3 million in tax credits is available annually, and up to $1 million in tax credits is available for a single qualified small business. Tax credits are available until 2017. (Reference Nebraska Revised Statutes 49-801.01; 77-2715.07; 77-6301; 77-6306)

Biodiesel Production Investment Tax Credit

Investors in Nebraska biodiesel production facilities are eligible to receive a tax credit of 30% of the amount invested in the facility between January 1, 2008, and January 1, 2015, up to $250,000. The credit is only available for facilities that produce B100, conduct all processing in Nebraska, and are at least 51% owned by Nebraska individuals or entities. The state may reclaim the tax credit if the biodiesel production facility remains in operation for less than three years. B100 is defined as a pure biodiesel containing mono-alkyl esters of long chain fatty acids derived from vegetable oils or animal fats that meets ASTM standard D6751. (Reference Nebraska Revised Statutes 77-27,236)

Alternative Fuel Vehicle (AFV) and Fueling Infrastructure Loans

The Nebraska Energy Office administers the Dollar and Energy Saving Loan Program, which makes low-cost loans available for a variety of alternative fuel projects, including the replacement of conventional vehicles with AFVs; the purchase of new AFVs; the conversion of conventional vehicles to operate on alternative fuels; and the construction or purchase of fueling stations or equipment. The maximum loan amount is $750,000 per borrower, and the interest rate is 5% or less. For more information, see the Dollar and Energy Saving Loans website.

Alternative Fuel Tax Refund

The Motor Fuel Tax Enforcement and Collection Division of the Nebraska Department of Revenue will refund taxes paid on compressed natural gas, liquefied natural gas, and liquefied petroleum gas (propane) when the fuel is used to operate buses capable of carrying seven or more passengers within or near a municipality. (Reference Nebraska Revised Statutes 66-6,100 and 66-6,109.01)

Ethanol and Biodiesel Tax Exemption

Motor fuels sold to an ethanol or biodiesel production facility and motor fuels manufactured at and sold from an ethanol or biodiesel facility are exempt from certain motor fuel tax laws the Motor Fuels Division of the Nebraska Department of Revenue enforces. (Reference Nebraska Revised Statutes 66-489 and 66-496)

Idle Reduction Weight Exemption

The maximum gross weight limit and axle weight limit for any vehicle or combination of vehicles equipped with idle reduction technology may exceed the state's gross weight limit by up to 400 pounds per vehicle to compensate for the additional weight of the idle reduction technology. (Reference Nebraska Revised Statutes 60-6,294)

Utility/Private Incentives

Compressed Natural Gas (CNG) Vehicle Incentives - Metropolitan Utilities District (MUD)

Residential gas customers in the Omaha area served by the MUD are eligible for a $500 rebate for the purchase of a dedicated CNG vehicle. Rebates are in the form of a pre-paid fuel card and are available on a first-come, first-served basis. Applicants must provide proof of purchase for the vehicle to qualify. Additional restrictions may apply. Commercial rebates are available on a case-by-case basis. For more information, see the MUD CNG Rebates website.

Additionally, commercial fleets in the Omaha area are eligible to receive financial assistance from the MUD Fleet Fund for up to 50% of the incremental cost of purchasing a dedicated CNG vehicle. Funding awarded will vary based on various factors, including annual fuel usage.

Point of Contact
Kyle Bowman
Natural Gas Vehicle Specialist
Metropolitan Utilities District
Phone: (402) 504-7185
Fax: (402) 504-5185
kyle_bowman@mudnebr.com
http://www.mudomaha.com/

Laws and Regulations

Low-Speed Vehicle Access to Roadways

Low-speed vehicles may only travel on roadways with a posted speed limit of up to 35 miles per hour (mph) but may cross highways with a posted speed limit of over 35 mph. A low-speed vehicle is any four-wheeled motor vehicle with a gross vehicle weight rating of up to 3,000 pounds and a top speed of at least 20 mph but not more than 25 mph. A low-speed vehicle must be manufactured in compliance with federal standards for low-speed vehicles as referenced in Title 49 of the U.S. Code of Federal Regulations, section 571.500. (Reference Nebraska Revised Statutes 60-119.01 and 60-6,380)

Natural Gas Motor Vehicle Fuel Promotion

An eight member Natural Gas Fuel Board (Board) was created to advise the Nebraska Energy Office regarding the promotion of natural gas as a motor vehicle fuel. The Board will provide recommendations relating to the distribution, infrastructure, and workforce development necessary for widespread use of natural gas as a motor vehicle fuel; loans, grants, and tax incentives that will encourage the use of natural gas as a motor vehicle fuel by individuals and public and private fleets; and other matters as the Board deems appropriate. (Reference Nebraska Revised Statutes 66-2001)

Alternative Fuel Use

All state employees operating flexible fuel or diesel vehicles as part of the state fleet must use E85 or biodiesel blends whenever reasonably available. Additionally, the Nebraska Transportation Services Bureau and Nebraska Department of Roads must take steps to increase access to E85 and blends of 2% biodiesel (B2) for state vehicle operators. (Reference Executive Order 05-03, 2005)

Alternative Fuel Vehicle (AFV) Registration

A fee of $75 is required for the registration of an AFV that operates on electricity, solar power, or any other source of energy not otherwise taxed under the state motor fuel tax laws. Compressed natural gas, liquefied natural gas, and liquefied petroleum gas (propane) are not subject to this requirement. (Reference Nebraska Revised Statutes 60-306 and 60-3,191)

Alternative Fuel Excise Tax

An excise tax of $0.075 per gallon or gasoline gallon equivalent (GGE) is imposed on all compressed natural gas (CNG), liquefied natural gas (LNG), and liquefied petroleum gas (propane) sold for use in registered motor vehicles. Additionally, each retailer of such fuel must pay an excise tax of $0.028 per gallon or GGE on all CNG, LNG, and propane fuel sold for use in registered motor vehicles. Additional taxes as specified annually under these statutes may apply. (Reference Nebraska Revised Statutes 66-6,102; 66-6,107; and 66-6,109)