Indiana Laws and Incentives for Propane (LPG)

The list below contains summaries of all Indiana laws and incentives related to Propane (LPG).

State Incentives

Alternative Fueling Station Grant Program

The Alternative Fueling Station Grant Program provides grants of up to $20,000 for installing new alternative fueling stations or converting existing fueling stations to dispense alternative fuels. Eligible alternative fuels include liquefied petroleum gas (propane) and compressed natural gas. The Indiana Office of Energy Development must review and approve applications for the grant program, and the grant funding awarded for all fiscal years may not exceed $1 million. As of April 2012, no funds have been appropriated for this incentive. (Reference Indiana Code 4-4-32.2)

Alternative Fuel Vehicle (AFV) Grant Program

The Alternative Fuel Vehicle Grant Program offers grants to counties, cities, towns, townships, or school corporations to purchase original equipment manufacturer (OEM) AFVs and for the cost of AFV conversions. Qualified entities may receive $2,000 for each OEM AFV purchased, and up to $2,000 for each AFV conversion. Eligible AFVs include dedicated and bi-fuel liquefied petroleum gas (propane) and compressed natural gas vehicles. The Indiana Office of Energy Development must review and approve applications for the grant program, and the grant funding awarded for all fiscal years may not exceed $1 million. As of April 2012, the grant program is closed and applications are not being accepted. (Reference Indiana Code 4-4-32.3)

Alternative Fuel Vehicle (AFV) Manufacturer Tax Credit

The Indiana Economic Development Corporation (IEDC) may award tax credits under the Hoosier AFV Manufacturer Tax Credit to foster job creation, reduce dependence on imported energy sources, and reduce air pollution resulting from the manufacture or assembly of light-duty AFVs in Indiana. AFV manufacturers are eligible for tax credits of up to 15% of qualified investments, which include expenditures in the state that are reasonable and necessary for the manufacture or assembly of AFVs. To be eligible, the manufacturer must compensate its employees at least 150% of the state's hourly minimum wage and agree to maintain operations for at least 10 years. Additional restrictions apply. For the purpose of this incentive, AFVs are defined as vehicles designed to operate on E85, biodiesel, ultra low sulfur diesel fuel, natural gas, liquefied petroleum gas (propane), hydrogen, methanol, coal-derived liquid fuels, non-alcohol fuels derived from biological material, P-Series fuels, or electricity. IEDC must review and approved applications for this incentive. The credit applies to taxable years beginning after December 31, 2006, and before December 31, 2016. Unused credits may be carried forward for up to nine consecutive taxable years. (Reference Indiana Code 6-3.1-31.9)

Vehicle Research and Development Grants

The Indiana Economic Development Corporation administers the Indiana 21st Century Research and Technology Fund, which provides grants and loans to support proposals for economic development in high technology industry clusters. Incentives are available for qualified alternative fuel technologies and fuel-efficient vehicle production. (Reference Indiana Code 5-28-16-2)

Laws and Regulations

Certified Technology Park Designation

The Indiana Economic Development Corporation may designate an area as a certified technology park if certain criteria are met, including a commitment from at least one business engaged in a high technology activity that creates a significant number of jobs. The establishment of high technology activities and public facilities within a technology park serves a public purpose and benefits the public's general welfare by encouraging investment, job creation and retention, and economic growth and diversity. High technology activities include advanced vehicles technology, which is any technology that involves electric vehicles, hybrid electric vehicles, or alternative fuel vehicles, or components used in the construction of these vehicles. (Reference Indiana Code 36-7-32)

Alternative Fuel Vehicle (AFV) Decals

An individual may place alternative fuel into the fuel tank of a motor vehicle only if the vehicle has a valid alternative fuel decal affixed to the front windshield or the individual has submitted an application for a decal within the last 30 days. All heavy-duty AFVs and light-duty AFVs that public or private utilities own require vehicle decals. The cost of the decal varies according to vehicle type and the gross vehicle weight rating. The annual fee may be prorated if the vehicle is newly purchased, registered in Indiana, or converted to operate using an alternative fuel. (Reference Indiana Code 6-6-2.1-203 through 6-6-2.1-206)