Utah Laws and Incentives

Listed below are the summaries of all current Utah 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

Qualified Heavy-Duty Alternative Fuel Vehicle (AFV) Tax Credit

Qualified taxpayers are eligible for a tax credit for the purchase of a qualified heavy-duty AFV. Qualifying fuels include natural gas, electricity, and hydrogen. Each qualified heavy-duty AFV is eligible for the following tax credit amounts:

YearCredit Amount
2017$25,000
2018$20,000
2019$18,000
2020$15,000

At least 50% of the qualified vehicle's miles must be driven in the state. A single taxpayer may not claim credits for more than 10 AFVs annually or a total annual amount of $500,000. If more than 30% of the total available tax credits in a single year have not been claimed by May 1, a taxpayer may apply for credits on an additional eight AFVs. Up to 25% of the tax credits are reserved for taxpayers with small fleets of less than 40 vehicles. This credit expires December 31, 2020. Additional conditions and restrictions may apply.

(Reference Senate Bill 24, 2017 and Utah Code 59-7-618, 59-10-1033, and 59-13-201)

Point of Contact
Mat Carlile
Clean Fuel Tax Coordinator
Utah Department of Environmental Quality, Division of Air Quality
Phone: (801) 536-4136
Fax: (801) 536-0085
mcarlile@utah.gov

Alternative Fuel Vehicle and Fueling Infrastructure Grants and Loans

The Utah Clean Fuels and Vehicle Technology Grant and Loan Program, funded through the Clean Fuels and Vehicle Technology Fund, provides grants and loans to assist businesses and government entities to include:

  • Up to 50% of the incremental cost of purchasing original equipment manufactured clean fuel vehicles,
  • Up to 50% of the cost of converting vehicles to a cleaner burning fuel, and
  • The cost of fueling equipment for public/private sector business and government vehicles (grants require federal and non-federal matching funds).
This program does not support E85 or biodiesel projects. For the purpose of this program, clean fuels include propane, compressed natural gas, and electricity. For more information, see the Utah Clean Fuels Program website.

(Reference Utah Code 19-1-401 through 19-1-405)

Point of Contact
Lisa Burr
Senior Research Analyst
Utah Department of Environmental Quality, Division of Air Quality
Phone: (801) 536-4019
Fax: (801) 536-0085
lburr@utah.gov

Alternative Fuel Vehicle Conversion Grants for Businesses

The Utah Conversion to Alternate Fuel Grant Program, funded through the Clean Fuels and Vehicle Technology fund, provides grants to businesses that install conversion equipment on eligible vehicles. Businesses are required to pass these savings along to the individual who purchases the converted vehicle. Grants are available for 50% of the cost of conversion, up to $2,500. This program does not support E85 or biodiesel projects. This program defines clean fuels to include propane, compressed natural gas, and electricity. For more information, see the Utah Conversion to Alternative Fuel Grant Program website.

(Reference Utah Code 19-1-401, 19-1-402, 19-1-403.3, and 19-1-405)

Point of Contact
Mat Carlile
Clean Fuel Tax Coordinator
Utah Department of Environmental Quality, Division of Air Quality
Phone: (801) 536-4136
Fax: (801) 536-0085
mcarlile@utah.gov

Alternative Fuel Tax Exemptions and Reductions

Propane, natural gas, electricity, and hydrogen, also known as special fuel, used to operate motor vehicles are exempt from state fuel taxes, but subject to a special fuel tax at the rate of three-nineteenths of the conventional motor fuel tax. A reduction in special fuel tax is permissible if the fuel is already taxed by the Navajo Nation. Retailers, wholesalers, and suppliers of special fuel are eligible for a refund of the special fuel tax if dyed diesel fuel is mixed with special fuel and the mixed special fuel is returned to the refinery. For more information, see the Utah State Tax Commission Fuel Taxes website. (Reference Utah Code 59-13-102, 59-13-201, 59-13-301, and 59-13-322)

Hydrogen Fuel Production Incentives

Businesses that convert natural gas to hydrogen fuel, or produce natural gas solely for use in the production of hydrogen fuel for zero emission motor vehicles, may be eligible for an oil and gas severance tax credit. Each eligible applicant may receive a tax credit equal to the amount of the severance tax owed, up to $5,000,000 per year. Entities that produce hydrogen fuel for use in zero emission motor vehicles or hydrogen fueled trucks may also qualify for grant funding or loans from the Community Impact Fund. (Reference House Bill 405, 2017 and Utah Code 35A-8-302 and 59-5-102)

Alternative Fuel Vehicle Decal and High Occupancy Vehicle (HOV) Lane Exemption

Vehicles operating on propane, natural gas, or electricity are permitted to use HOV lanes, regardless of the number of passengers. Qualified vehicles must display the special clean fuel decal issued by the Utah Department of Transportation (UDOT); a limited number of decals are available. This exemption expires September 30, 2019. For more information about qualifying vehicles and decal availability, see the UDOT Clean Fuel Vehicle Decal and Permit website. (Reference Utah Code 41-1a-416, 41-1a-418, 41-6a-702, 59-13-102, and 72-6-121)

Laws and Regulations

Natural Gas and Hydrogen Tax

Compressed natural gas (CNG) and hydrogen are taxed at a rate of $0.125 per gasoline gallon equivalent (GGE) until June 30, 2017; this rate will increase by $0.02 per year until July 2018. Liquefied natural gas (LNG) is taxed at a rate of $0.125 per diesel gallon equivalent (DGE) until June 30, 2017; this rate will increase by $0.02 per year until July 2018. One GGE is equal to 5.660 pounds (lbs.) of CNG or 2.198 lbs. of hydrogen. One DGE is equal to 6.06 lbs. of LNG. (Reference Utah Code 59-13-301)

Compressed Natural Gas (CNG) Vehicle Aftermarket Conversion Requirements

Vehicles converted to operate on CNG must be inspected and certified in accordance with relevant safety standards by a CSA America-certified CNG Fuel System Inspector. The vehicle must also be tested to ensure that it meets emissions standards in the applicable county, or the county with the most lenient emissions standards if the vehicle is registered in a county without its own emissions standards. A person who performs a conversion must certify to the vehicle owner that the conversion does not tamper with, circumvent, or otherwise affect the vehicle's on-board diagnostic system, if applicable. A CSA America-certified CNG Fuel System Inspector must also inspect the vehicle every three years, or every 36,000 miles, and after a collision occurring at a speed greater than five miles per hour.

The Utah Division of Air Quality may develop programs to facilitate coordination between government agencies and the private sector regarding emissions and anti-tampering compliance testing, vehicle safety, and potential improvements in the air quality of the state.

(Reference Utah Code 19-1-406)

Public Access to State Compressed Natural Gas (CNG) Fueling Stations

The Utah Department of Administrative Services Division of Fleet Services (Division) may allow a private individual or entity to purchase CNG from a state-operated fueling station if there are no commercial fueling stations that meet the geographical needs of the individual or entity and there is not an emergency that requires the state to reserve CNG for use by state or emergency vehicles. For information on obtaining a GasCard for fueling as well as state fueling network stations that are available to private individuals and entities, see the Division Fleet website. (Reference Utah Code 63A-9-702)

Natural Gas Rate and Cost Recovery Authorization

The Utah Public Service Commission (Commission) may allow a gas corporation to set a natural gas vehicle fuel rate that is less than full cost of service if it is reasonable and in the interest of the public. If the Commission approves such a request, the remaining costs may be spread to other customers of the gas corporation.

The Commission may also allow a gas corporation to recover expenditures directly related to the construction, operation, and maintenance of natural gas fueling stations and related facilities through an incremental surcharge to all of its rate classes. The Commission may allow this only if it finds that the expenditures are reasonable, do not exceed $5 million in any calendar year, are in the interest of the public, and will result in an annual incremental increase in revenue greater than 50% of the corporation's annual revenue requirement for the stations and facilities.

(Reference Utah Code 54-4-13.1 and 54-4-13.4)

Alternative Fuel Vehicle (AFV) Conversion Promotion

An interlocal entity composed of members from state and local government, school and transit districts, and the private sector may be created to promote the conversion of AFVs and to encourage the construction, operation, and maintenance of facilities for AFVs. The interlocal entity may contribute funding for an AFV facility so long as the entity uses or benefits from the facility. It must also work with the Utah Public Service Commission (Commission) to explore options and opportunities to facilitate AFV conversions and promote the enhancement and expansion of infrastructure and facilities for AFVs throughout Utah.

The Commission submitted a report to the governor on September 20, 2013, outlining options and opportunities for advancing and promoting measures, such as AFV conversions, to result in cleaner air in Utah.

(Reference Utah Code 54-1-13 and 11-13-224)

Alternative Fuel Vehicle Inspection and Permit

The Utah State Tax Commission (Commission) may require vehicles operating on clean fuels to be inspected for safe operation. In addition, clean fuel vehicles that have a gross vehicle weight rating of more than 26,000 pounds or have more than three axels are required to obtain a special fuel user permit from the Commission. Clean fuels are defined as propane, natural gas, electricity, and hydrogen. (Reference Utah Code 59-13-102, 59-13-303, and 59-13-304)

Support for Clean Fuel School Buses

The Utah Legislature supports dedicating the Volkswagen Clean Air Act Civil Settlement funds allocated to Utah to replace diesel school buses that are Model Year 2006 and older with clean fuel school buses. (Reference House Concurrent Resolution 5, 2017)

Support for Consideration of Vehicle Environmental Impacts

The Utah Legislature encourages the citizens of Utah to consider the U.S. Environmental Protection Agency vehicle smog rating and other environmental impacts when purchasing a vehicle. The Utah Legislature suggests that auto dealers make vehicle smog ratings known to customers and that customers purchase vehicles with a smog rating of eight or higher. (Reference House Concurrent Resolution 18, 2017)

Support for Autonomous Vehicle Testing and Operation

State agencies with regulatory authority over autonomous vehicle technology must facilitate and encourage the proper testing and operation of autonomous vehicles in Utah. Autonomous vehicles are motor vehicles equipped with technology that allows vehicle automation to perform one or more driving functions without the direct control of the driver. In October 2016, the Utah Department of Public Safety, in consultation with the Utah Division of Motor Vehicles and the Utah Department of Transportation, published a report that evaluates best practices for regulating autonomous vehicles on Utah highways. (Reference Utah Code 41-26-101 and 41-26-102)

Connected Vehicle Technology Testing Authorization

The Utah Department of Transportation (UDOT) may implement a testing program focused on networked, wireless communication among vehicles, infrastructure, and communication devices. UDOT will report the results of its findings by October 30 of any year that they conduct a testing program. Testing must be conducted outside of an urbanized boundary as defined by the U.S. Census Bureau. (Reference Utah Code 41-6a-711)

Provision for Establishment of Alternative Fuel Use Mandate

The Utah Air Quality Board may require fleets that own 10 or more vehicles capable of being fueled at a central location to use clean fuels if such a mandate is necessary to meet national air quality standards. Clean fuels are defined as propane, compressed natural gas, and electricity. This program expires July 1, 2019. Additional restrictions apply. (Reference Utah Code 19-2-105.3 and 63I-1-219)

Low-Speed Vehicle Access to Roadways

Low-speed vehicles are only allowed access to roadways with speeds limits of up to 35 miles per hour, must comply with all federal and state motor vehicle regulations, and are required to display a slow-moving vehicle identification emblem on the rear of the vehicle. Low-speed vehicles are defined as four-wheel electric vehicles that are not golf carts or off-road vehicles, operate at speeds up to 25 miles per hour, and may carry up to four passengers. Low-speed vehicles are subject to vehicle taxation requirements, including those related to special fuels and are exempt from emission inspections. (Reference Utah Code 41-6a-102, 41-6a-1508, 59-13-102, and 59-13-201)

Public Utility Definition

An entity that provides electric vehicle battery charging services is not defined as a public utility, unless the entity conducts another activity in the state that subjects it to the regulation and jurisdiction of the Utah Public Service Commission. (Reference Utah Code 54-2-1)

Public Utility Plug-In Electric Vehicle (PEV) Incentive Program Authorization

The Utah Public Service Commission (PSC) may authorize a utility to spend up to $2,000,000 annually for the cost of a PEV incentive program through December 31, 2021. The PSC must approve the program by July 1, 2017; programs may involve PEV charging infrastructure, PEV charging time of use pricing, and other incentives for customers to deploy charging infrastructure. (Reference Utah Code 54-7-12.8 and 54-20-103)

Alternative Fuel Use and Vehicle Acquisition Requirement

By August 30, 2018, at least 50% of new or replacement light-duty state agency vehicles must meet Bin 2 emissions standards established in Title 40 of the U.S. Code of Federal Regulations, or be propelled to a significant extent by electricity, natural gas, propane, hydrogen, or biodiesel. (Reference Utah Code 63A-9-401 and 63A-9-403)

Plug-In Electric Vehicle (PEV) Infrastructure Bond Authorization

Interlocal entities, such as counties, local districts, and military installations, are authorized to issue bonds for PEV charging infrastructure. PEV charging infrastructure is defined as any permanent equipment on commercial or industrial property that charges or stores energy for delivery to PEVs. (Reference Utah Code 11-42-102 and 11-13-218)

State Fleet Idle Reduction Requirement

State of Utah fleet vehicles must turn off their engines when stopped for more than 30 consecutive seconds. Exemptions apply. State agencies must develop a compliance policy for their vehicle fleet. For more information, see the Automotive Idling Reduction Policy and the Utah Department of Administrative Services Policies website.

Idle Reduction Requirement

Idling of any unattended vehicle is prohibited in Utah. Violators are subject to a penalty of up to $750 and/or up to 90 days imprisonment. Drivers on state roads are also encouraged to avoid excessive idling, which, as a general rule, is defined as more than 10 to 15 seconds for passenger vehicles. Specifically, drivers are encouraged to turn off engines when loading or unloading, delivering, and picking up or dropping off passengers. Drivers of gasoline powered passenger vehicles are encouraged to limit engine warm-up time to 30 seconds and drivers of diesel powered passenger vehicles, buses, and trucks are encouraged to limit engine warm-up to the time the vehicle manufacturer recommends, which is generally less than five minutes. Businesses, schools, airport authorities, and governmental entities are encouraged to post signs to discourage customer idling. (Reference Utah Code 41-6a-202, 41-6a-1403, 76-3-204, and 76-3-301)

School Bus Idle Reduction Regulations

School bus drivers must turn off bus engines as soon as possible at loading and unloading areas and only restart the engine when it is time to depart. Exceptions include extreme weather conditions and idling in traffic. At bus depots, drivers are required to limit engine warm-up to the time recommended by the engine manufacturer. All school bus drivers in the state receive a minimum of 30 minutes of idling reduction instruction during their annual service training. In addition, school districts must revise bus schedules to maximize efficiency and assign the cleanest buses to the longest routes. (Reference Utah Code 41-6a-1308, Utah Administrative Code 277-601-1 through 277-601-3, and Standards for Utah School Buses and Operations)

Local Vehicle Idling Regulations

A local highway authority may not enact an ordinance that prohibits or restricts an owner or operator of a vehicle from idling the vehicle's engine, unless the ordinance is primarily educational, specifies that a person must be issued at least three warnings before a fine is imposed, has the same fine structure as a parking violation, provides for the safety of law enforcement personnel enforcing the ordinance, and specifies that the ordinance may be enforced on public property or private property that is open to the general public. Exceptions apply. (Reference Utah Code 41-6a-208)

Clean Air Fund

Individuals filing a Utah state income tax return may designate a contribution to the Clean Air Fund. The Utah Department of Air Quality will distribute funds annually for programs to educate the public on the importance of air quality, such as the use of alternative fuel vehicles. (Reference Utah Code 59-10-1304 and 59-10-1319)