Illinois Laws and Incentives

Listed below are the summaries of all current Illinois 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

Clean Diesel Retrofit and Idle Reduction Grants

The Illinois Clean Diesel Grant Program provides funding to local governments, school districts, school bus companies, colleges, universities, mass transit districts, businesses, and non-profit organizations to reduce diesel emissions. Funding is available statewide for school bus heaters, engine repowers of off-road equipment and marine vessels, and for natural gas and propane fleet vehicles in the Chicago area.

Point of Contact
Darwin Burkhart
Manager, Clean Air Programs
Illinois Environmental Protection Agency
Phone: (217) 524-5008
darwin.burkhart@illinois.gov

Electric Vehicle (EV) Registration Fee Reduction

The owner of a dedicated EV may register for a discounted registration fee not to exceed $35 for a two-year registration period. The registration fee for an EV may not exceed $9 per year. To qualify for the reduced fee, the EV must weigh 8,000 pounds or less and be propelled by an electric engine. For more information, including the application documentation, see the Electric Vehicle License Plate Guide website. (Reference 625 Illinois Compiled Statutes 5/3-805)

Electric Vehicle Emissions Inspection Exemption

Vehicles powered exclusively by electricity are exempt from state motor vehicle emissions inspections. For more information, see the Illinois Environmental Protection Agency's Vehicle Emissions Testing Program website. (Reference 625 Illinois Compiled Statutes 5/13C)

School Bus Retrofit Reimbursement

The Illinois Department of Education will reimburse any qualifying school district for the cost of converting gasoline buses to more fuel-efficient engines or to engines using alternative fuels. Restrictions may apply. (Reference 105 Illinois Compiled Statutes 5/29-5)

Biofuels Tax Exemption

Sales and use taxes apply to 80% of the proceeds from the sale of fuel blends containing between 1% and 10% biodiesel and the sale of fuels containing 10% ethanol (E10) made between July 1, 2003, and July 1, 2017. If at any time these taxes are imposed at a rate of 1.25%, the tax on biodiesel blends and E10 will apply to 100% of the proceeds of sales. These taxes do not apply to the proceeds from the sale of biodiesel blends containing more than 10% biodiesel up to 99% biodiesel or fuels containing between 70% and 90% ethanol (E70-E90) sold between July 1, 2003, and December 31, 2023. Taxes will apply to 100% of the proceeds from biodiesel and ethanol fuel blend sales made after December 31, 2023. (Reference Senate Bill 9, 2017, and 35 Illinois Compiled Statutes 120/2-10, 105/3-10, and 105/3-44)

Fleet User Fee Exemption

Fleets with 10 or more vehicles located in defined areas of the state must pay an annual user fee of $20 per vehicle. Owners of electric vehicles and owners of state, county, or local government vehicles are exempt from this fee. The Office of the Illinois Secretary of State will deposit all fees into the Alternate Fuels Fund. (Reference 415 Illinois Compiled Statutes 120/35)

Idle Reduction Weight Exemption

A vehicle equipped with idle reduction technology may exceed the state's gross, axle, and bridge vehicle weight limits by up to 500 pounds to compensate for the additional weight of the idle reduction technology. The additional weight may not exceed the actual weight of the idle reduction unit. The vehicle operator must carry written certification showing the weight of the technology and must be able to demonstrate or certify that the unit is fully functional. (Reference 625 Illinois Compiled Statutes 5/15-112)

Natural Gas and Propane Vehicle Weight Exemption

A vehicle powered by natural gas or propane may exceed the state's gross, axle, and bridge vehicle weight limits by up to 2,000 pounds. This exemption does not apply on interstate highways. (Reference 625 Illinois Compiled Statutes 5/15-111)

Smart Grid Infrastructure Development and Support

The Illinois Science and Energy Innovation Trust (Trust) will provide financial and technical support to public and private entities within the state for programs and projects that support, encourage, or utilize innovative technologies and methods to modernize the state's electric grid. Technologies may include advanced electricity storage and peak-shaving technologies, such as plug-in electric vehicles (PEVs) or devices that allow PEVs to engage in smart grid functions. The Trust also offers assistance for standards development for communication and interoperability of appliances and equipment connected to the electric grid. Electric utilities may voluntarily commit to investments in smart grid advanced metering infrastructure deployment. Participating utilities must consult with the Smart Grid Advisory Council and file a Smart Grid Advanced Metering Infrastructure Deployment Plan with the Illinois Commerce Commission. (Reference 220 Illinois Compiled Statutes 5/16-108.5 through 108.7)

Utility/Private Incentives

Plug-In Electric Vehicle (PEV) Financing and Charging - Illinois Electric Cooperative

Cooperative (Co-op) members are eligible for loan financing at 0.5% for 60 months or the purchase of new PEVs. Members must apply and be approved for financing before purchase. The Co-op also offers a PEV time-of-use electricity rate for residential customers who own PEV. The PEV rate is optional and does require installation of a separate meter. For more information, see the Illinois Electric Cooperative website.

Laws and Regulations

Alternative Fuels Tax and Reporting

Beginning July 1, 2017, alternative fuel dealers must sell liquefied natural gas (LNG) and propane used as motor fuel in diesel gallon equivalents (DGEs). For taxation purposes, LNG and propane must be reported as DGEs and are taxed at a rate of $0.215 per DGE. One DGE is equal to 6.06 pounds (lbs.) of LNG and 6.41 lbs. of propane. Alternative fuel dealers must sell compressed natural gas (CNG) used as motor fuel in gasoline gallon equivalents (GGEs). CNG must be reported in GGEs and is taxed at a rate of $0.19 GGE. One GGE is equal to 5.66 lbs. of CNG. (Reference Senate Bill 2801, 2017)

Highway Electric Vehicle Supply Equipment (EVSE) Installation Requirements

The Illinois Department of Transportation (Department) must install at least one EVSE at each interstate highway rest area where electrical service will reasonably permit by January 1, 2016, or as soon as possible thereafter. The Department may adopt specifications detailing the type of EVSE and rules governing station siting, user fees, and maintenance.

The Illinois State Toll Highway Authority (ISTHA) must also construct and maintain at least one EVSE at any location along toll highways where it has entered into an agreement with an entity for the purposes of providing motor fuel service stations and facilities, garages, stores, or restaurants. ISTHA may charge a fee for the use of the EVSE to offset the costs of construction and maintenance. ISTHA may also adopt rules regarding station siting, user fees and maintenance.

(Reference 605 Illinois Compiled Statutes 5/4-223 and 10/11)

Electric Vehicle Supply Equipment (EVSE) Installation Requirements

Vendors that install EVSE must comply with Illinois Commerce Commission (ICC) certification requirements. For specific requirements, see the ICC EVSE Installer Certification website. (Reference 220 Illinois Compiled Statutes 5/3-105, 5/16-102, and 5/16-128A)

Public Utility Definition

An entity that owns, controls, operates, or manages a facility that supplies electricity to the public exclusively to charge battery electric and plug-in hybrid electric vehicles or compressed natural gas to fuel natural gas vehicles is not defined as a public utility. (Reference 220 Illinois Compiled Statutes 5/3-105, and 20 Illinois Compiled Statutes 627/10)

Plug-in Electric Vehicle (PEV) Promotion and Coordination

The Illinois Electric Vehicle Advisory Council (Council) was established to investigate and recommend strategies that the governor and the general assembly can implement to promote the use of PEVs, including potential infrastructure improvements. The Council published recommendations in its Final Report. An Electric Vehicle Coordinator serves as the point of contact for related policies and activities in the state. (Reference 20 Illinois Compiled Statutes 627/1-25)

Fuel-Efficient Vehicle Acquisition Goals

Illinois state agencies must work towards meeting the following goals:

  • By July 1, 2025, at least 60% of new passenger vehicles purchased must be hybrid electric vehicles (HEVs) and 15% must be battery electric vehicles (EVs).
  • Agencies that operate medium- and heavy-duty vehicles must implement strategies to reduce fuel consumption through diesel emission control devices, HEV and EVs technologies, alternative fuel use, and fuel-efficient technologies.
  • Agencies must also implement strategies to promote the use of biofuels in state vehicles; reduce the environmental impacts of employee travel; and encourage employees to adopt alternative travel methods.

Vehicles designated as specialty, police, and emergency vehicles by the Illinois Department of Central Management Services, are exempt from these goals, but should make all reasonable efforts to minimize petroleum usage.

(Reference Executive Order 11, 2009)

Biodiesel Production Tax

A private biodiesel producer that produces less than 5,000 gallons of biodiesel annually is subject to the annual state motor fuel tax. The return and payment of taxes for a given year are due by January 20 of the following year. A private biodiesel producer that produces more than 5,000 gallons of biodiesel annually must file returns and make state motor fuel tax payments on a monthly basis. The return and payment of taxes are due by the 20th day of each calendar month for the preceding calendar month. A private biodiesel fuel producer is defined as a person whose only activities with respect to motor fuel are: the conversion of any biomass materials into biodiesel fuel that is produced exclusively for personal use and not for sale, or the blending of biodiesel fuel resulting in biodiesel blends that are produced exclusively for personal use and not for sale. (Reference 35 Illinois Compiled Statutes 505/2, 505/2a, and 505/2d)

Biodiesel Definition and Specification

Biodiesel is defined as a fuel that is comprised of mono-alkyl esters of long-chain fatty acids derived from vegetable oils or animal fats and that conforms to ASTM standard D6751. All fuel consisting of at least 99% biodiesel (B99) that is sold or offered for sale must conform to ASTM standard D6751. (Reference 815 Illinois Compiled Statutes 370/4)

Biodiesel Blend Use Requirement

Any diesel-powered vehicle the state, county or local government, school district, community college, public college or university, or mass transit agency owns or operates must use a biodiesel blend that contains at least 5% biodiesel (B5) when fueling at a bulk central fueling facility. These entities are required to use B5 where available unless the vehicle engine is designed or retrofitted to operate on a higher percentage of biodiesel or on ultra-low sulfur diesel. (Reference 20 Illinois Compiled Statutes 689/10 and 625 Illinois Compiled Statutes 5/12-705.1)

Alternative Fuels Labeling Requirement

Retailers must display ratings on fueling pumps that are consistent with the percentage by volume of the alternative fuel being dispensed. The labels must be affixed to the front panel of the pump in a position that is clearly visible to the vehicle driver. The labeling must follow established labeling specifications. (Reference 815 Illinois Compiled Statutes 370/4.1)

Ethanol and Hydrogen Production Facility Permits

The Illinois Environmental Protection Agency (EPA) may issue air pollution control permits through the Bureau of Air for thermochemical conversion technology facilities that are constructed and operated to demonstrate the process of applying heat to woody biomass to produce ethanol or hydrogen for use as transportation fuel. Permit applicants must perform emissions testing during the permit period as the Illinois EPA requires. They must submit the results of that testing to the Illinois EPA within 60 days after the completion of testing. (Reference 415 Illinois Compiled Statutes 5/39.9)

Biofuels Education and Promotion

The Promote Illinois Ethanol and Biodiesel Act requires state agencies, including state-supported universities and colleges, to provide links from their websites to sites containing information on ethanol and biodiesel fuels. The links must connect to websites maintained and operated by state agencies and may also include links to private websites. (Reference 505 Illinois Compiled Statutes 150/5)

State Government Energy Initiative

The Green Governments Illinois Act (Act) demonstrates the state's commitment to reduce negative environmental impacts, reduce greenhouse gases, and preserve resources for current and future generations. The Act also aims to strengthen the capacity of local governments and educational institutions to enable a more environmentally sustainable future. The Act established the Green Governments Coordinating Council (Council) to fully integrate cost-effective environmental sustainability measures into the ongoing management systems, long-range planning, and daily operations of state agencies. The Council will focus on initiatives that relate to energy efficiency, renewable energy, and alternative fuel vehicles. Local governments and educational institutes are not required to participate in the provisions of the Act. (Reference 20 Illinois Compiled Statutes 3954/1 to 3954/45)

Advanced Vehicle Acquisition and Biodiesel Fuel Use Requirement

All gasoline-powered vehicles purchased with state funds must be flex fuel vehicles (FFVs) or fuel-efficient hybrid electric vehicles (HEVs). FFVs are defined as automobiles or light trucks that operate on either gasoline or 85% ethanol (E85) fuel. Fuel-efficient HEVs are defined as automobiles or light trucks that use a gasoline or diesel engine and an electric motor to provide power and that gain at least a 20% increase in combined U.S. Environmental Protection Agency city-highway fuel economy over the equivalent or most-similar conventionally-powered model. Furthermore, any vehicle purchased with state funds that is fueled with diesel fuel must be certified by the manufacturer to run on 5% biodiesel (B5) fuel.

15% of all vehicles purchased with state funds must be fueled by electricity, natural gas, or liquefied petroleum gas (propane), with the exception of Department of Corrections, Department of State Police patrol, and Secretary of State vehicles (except mid-sized sedans).

The Chief Procurement Officer may determine that certain vehicle procurements are exempt from these requirements based on intended use or other reasonable considerations such as health and safety of Illinois citizens.

(Reference 30 Illinois Compiled Statutes 500/25-75)

Biofuels Preference for State Vehicle Procurement

When awarding contracts that require vehicle procurement, state agencies may give preference to an otherwise qualified bidder who will fulfill the contract through the use of vehicles powered by ethanol produced from Illinois corn or biodiesel produced from Illinois soybeans. (Reference 30 Illinois Compiled Statutes 500/45-60)

State Vehicle Fuel Economy Requirements

State contracts for the purchase or lease of new passenger automobiles must require the procurement of vehicle models that, according to the most current ratings published by the U.S. Environmental Protection Agency, can achieve at least the minimum average fuel economy in miles per gallon as specified in the federal Corporate Average Fuel Economy requirements. This requirement does not apply to station wagons, vans, four-wheel drive vehicles, and emergency vehicles. Additionally, the Chief Procurement Officer may make exemptions when there is a demonstrated need for a vehicle that does not meet the minimum average fuel economy standards. (Reference 30 Illinois Compiled Statutes 500/45-40)

Alternative Fuel Vehicle Labeling Requirement

Vehicles powered by liquefied petroleum gas (propane) or compressed natural gas (CNG) must visibly display identifying decals, as established by the National Fire Protection Association's standards for the Storage and Handling of Liquefied Petroleum Gases and for CNG Vehicular Fuel Systems. (Reference 625 Illinois Compiled Statutes 5/12-704.3)

Low-Speed Vehicle Access to Roadways

Low-speed vehicles may operate on streets with posted speed limits up to 30 miles per hour (mph) if authorized by the local government. Low-speed vehicles are allowed to cross an intersection where the road or street has a posted speed limit of up to 45 mph. Low-speed vehicles may cross an intersection where the road or street has a posted speed limit of more than 45 mph if the intersection is controlled by a traffic light or a four-way stop sign. Local governments may restrict low-speed vehicle access on streets with posted speed limits of 30 mph or less if they determine that public safety may be jeopardized. A low-speed vehicles is defined as a four-wheeled motor vehicle capable of maintaining a speed of more than 20 mph, but not more than 25 mph, and conform to federal regulations under Title 49 of the U.S. Code of Federal Regulations, section 571.500. (Reference 625 Illinois Compiled Statutes 5/1-140.7 and 5/11-1426.2)

Idle Reduction Requirement

A person that operates a diesel powered motor vehicle in certain counties and townships may not cause or allow the motor vehicle, when it is not in motion, to idle for more than a total of 10 minutes within any one-hour period. If the vehicle is waiting to weigh, load, or unload cargo or freight, it may idle for up to 30 minutes within any one-hour period. Specified areas include the counties of Cook, DuPage, Lake, Kane, McHenry, Will, Madison, St. Clair, and Monroe, and the townships of Oswego (Kendall County) and Aux Sable and Goose Lake (Grundy County). Exceptions apply, including those pertaining to emergency vehicles, vehicle weight, traffic, auxiliary power unit use, remote starter systems, and outside temperature. (Reference Senate Bill 1429, 2017, and 625 Illinois Compiled Statutes 5/11-1429)