Vermont Laws and Incentives
Listed below are the summaries of all current Vermont 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
Vermont's National Electric Vehicle Infrastructure (NEVI) Planning
The U.S. Department of Transportation’s (DOT) NEVI Formula Program requires the Vermont Agency of Transportation (AOT) to submit an annual EV Infrastructure Deployment Plan (Plan) to the DOT and U.S. Department of Energy (DOE) Joint Office of Energy and Transportation (Joint Office), describing how the state intends to distribute NEVI funds. The submitted plans must be established according to NEVI guidance.
For more information about Vermont’s NEVI planning process, see the AOT NEVI website. To review Vermont’s NEVI plan, see the Joint Office State Plans for EV Charging website.
Electric Vehicle (EV) Incentive
The Vermont Agency of Transportation provides financial incentives to low- and moderate-income residents for the purchase or lease of a new EV with a base manufacturer’s suggested retail price of $40,000 or less, on a first-come, first-served basis. Incentives are offered in the following amounts:
|
Tax Filing Status |
Adjusted Gross Income (AGI) Limits for Enhanced and Standard Incentives |
State Incentive Amount |
|
|---|---|---|---|
|
Plug-in Hybrid Electric Vehicle |
All-Electric Vehicle |
||
|
Individual filing as single or head of household; or Married filing separately |
$50,000 or less |
$3,000 |
$4,000 |
|
$50,001 up to $100,000 |
$1,500 |
$2,500 |
|
|
Married filing jointly; or Individual filing as qualifying widower |
$75,000 or less |
$3,000 |
$4,000 |
|
$75,001 up to $125,000 |
$1,500 |
$2,500 |
|
Incentives are limited to one per individual or married couple. Additional terms and conditions apply. For more information, including application and eligibility requirements, visit the Drive Electric Vermont website.
(Reference Act 55, 2019, Act 154, 2020, and Act 184, 2022)
Fuel-Efficient Vehicle and Emission Reduction Incentives
The Vermont Agency of Transportation (VTrans) administers the High Fuel Efficiency Used-Vehicle Program, MileageSmart, which provides incentives of up to $5,000 to replace eligible vehicles with a pre-owned vehicle that has a U.S. Environmental Protection Agency (EPA) combined city/highway fuel economy of at least 40 miles per gallon (mpg).
VTrans also offers vouchers of up to $2,500 for the repair of vehicles that failed the on-board diagnostic (OBD) systems inspection. Eligible vehicles for replacement include those that have failed the OBD systems inspection or those that are more than 15 years old and have an EPA combined city/highway fuel economy of less than 25 mpg. Eligible vehicles for a repair voucher are those that have failed the OBD systems inspection, require repairs that are not under warranty, and will be able to pass the inspection once the repairs are made. For more information on the emissions repair program, visit the VTrans Statewide Vehicle Incentives Programs website. The emissions repair program must be operational by January 1, 2023.
(Reference Act 59, 2019 and Act 55, 2021)
Heavy-Duty Vehicle Emissions Reduction Grants
Through the Vermont Diesel Emissions Reduction Grants Program, the Vermont Department of Environmental Conservation (DEC) provides funding to local, state and regional agencies or departments, businesses, institutions, and nonprofit organizations for projects focused on reducing emissions from diesel engines and vehicles. Qualifying heavy-duty vehicles include buses and Class 5-8 trucks. Projects eligible for funding are as follows:
- Verified emission control technologies;
- Verified idle reduction technologies;
- Verified aerodynamic technologies and low rolling resistance tires;
- Certified engine replacements;
- Alternative fuel conversions; and
- Certified vehicle or equipment replacements.
All technologies and engines must be certified by the U.S. Environmental Protection Agency. Alternative fuels include, but are not limited to, natural gas, propane, and electricity. Cost share requirements vary by project. For more information, including application details, see the DEC Vermont Diesel Emissions Reduction Grants website.
Alternative Fueling Infrastructure Incentive
The Vermont State Infrastructure Bank (SIB) offers loan assistance to municipalities, regional development corporations, political subdivisions of the state, and private companies working for the state to finance public electric vehicle charging and natural gas fueling stations. 1% fixed loans up to $100,000 are available to municipalities, non-profits, and private sector borrowers. Other terms and conditions may apply. See the Vermont Economic Development Authority’s SIB website for more information, including how to apply.
Multi-Unit Dwelling (MUD) Electric Vehicle (EV) Charging Station Grant
The Vermont Department of Housing and Community Development (DHCD) offers grants of up to $100,000 for the installation of EV charging stations at MUDs. Eligible applicants include governments, businesses, non-profits, homeowner associations, electric utilities, and EV charging equipment providers. Funding may be used for planning, permitting, purchase, installation, and other onetime costs associated with installing EV charging stations. Additional terms and conditions apply. For more information, see the DHCD MUD EV Charging Grant website.
Workplace Electric Vehicle (EV) Charging Station Grant
The Vermont Department of Housing and Community Development (DHCD) offers grants of up to $100,000 for the installation of Level 1 and Level 2 EV charging stations at workplaces. Eligible applicants include governments, businesses, non-profits, electric utilities, and EV charging equipment providers. Funding may be used for planning, purchase, installation, and other one-time costs associated with installing EV charging stations. Additional terms and conditions apply. For more information, see the DHCD Workplace Incentives for EV Charger Installation Assistance website.
Public Attraction Electric Vehicle (EV) Charging Station Grant
The Vermont Department of Housing and Community Development (DHCD) offers grants for the installation of direct current fast charging (DCFC) and Level 2 EV charging stations at locations available to the general public. Applicants may receive up to $56,000 for Level 2 EV charging stations, and up to $160,000 for DCFCs. Eligible applicants include governments, businesses, non-profits, electric utilities, and EV charging equipment providers. Funding may be used for planning, purchase, installation, and other one-time costs associated with installing EV charging stations. Additional terms and conditions apply. For more information, see the DHCD Public Attraction Incentives for EV Charger Installation Assistance website.
Electric Vehicle (EV) Fleet Grant Program
The Vermont Agency of Transportation will administer the Electrify Your Fleet Program (Program), which will provide up to $2,500 for the purchase or lease of EVs, including electric motorcycles. Applicants may receive up to 20 grants each. Eligible applicants include local and state governments, businesses, and non-profit organizations. Grants will be awarded on a first-come, first served basis. Additional terms and conditions apply.
(Reference House Bill 479, 2023)
Utility / Private Incentives
Electric Vehicle (EV) Incentives - Burlington Electric Department (BED)
BED provides low- or no-interest loans for the purchase of a new EV. Eligible customers can also apply for a rebate of $2,300 towards the purchase of a new all-electric vehicle (EV) or $2,000 towards the purchase of a plug-in hybrid electric vehicle (PHEV). An additional $600 is available for moderate income customers buying an EV or $300 for a PHEV. Vehicles must have a manufacturer’s suggested retail price that is less than or equal to $60,000. Additional terms and conditions apply. For more information, including income eligibility, see the BED Electric Vehicles website.
Electric Vehicle (EV) Time-Of-Use (TOU) Rate and EV Charging Rebate - BED
Burlington Electric Department (BED) offers a TOU rate to residential customers who own an EV. To qualify, customers must install a WiFi enabled EV charging station.
BED also offers a rebate of up to $900 for the purchase and installation of a qualifying Wifi enabled EV charging stations for customers that have enrolled in BED’s Residential EV Rate. Eligible applicants must have purchased an EV charging station within 60 days of the acquisition of the EV.
For more information, see the BED EV Rate website.
Pre-Owned Electric Vehicle (EV) Incentives – Burlington Electric Department (BED)
BED offers customers low- or no-interest loans for the purchase of a pre-owned EV. Eligible customers may also apply for a rebate of $1,300 rebate for the purchase of a pre-owned EV or plug-in hybrid electric vehicle (PHEV), with an additional $200 available for moderate income customers. Eligible vehicles must have a manufacturer’s suggested retail price less than or equal to $60,000. Additional terms and conditions apply. For more information, including income eligibility, see the BED EVs website.
Electric Vehicle (EV) Rebates - Green Mountain Power (GMP)
GMP provides residential and business customers rebates of $2,200 for the purchase of a new all-electric vehicle, $1,000 for the purchase of a new plug-in hybrid electric vehicle (PHEV), $1,500 for the purchase of a used all-electric vehicle, and $750 for the purchase of a used PHEV. Customers with qualifying low and moderate household incomes are eligible for an additional $1,000 rebate. EVs must have a manufacturer’s suggested retail price that is less than or equal to $70,000. For more information, see the GMP EV website.
Residential Electric Vehicle (EV) Charging Station Incentive - Green Mountain Power (GMP)
GMP residential customers are eligible for a free Level 2 EV charging station when they purchase a new or pre-owned plug-in electric vehicle. For more information about these incentives, see the GMP In-Home Level 2 EV Charger website.
Electric Vehicle (EV) Rebate - Stowe Electric
Stowe Electric offers customers rebates for the purchase or lease of EVs. New plug-in hybrid electric vehicles (PHEVs) are eligible for a $750 rebate, new all-electric vehicles are eligible for a rebate up to $1,000, and income-qualifying customers are eligible for an additional $250 rebate for either vehicle. Stowe Electric also offers a $300 rebate for the purchase of pre-owned EVs and PHEVs. For more information, including how to apply, see the Stowe Electric Electric Vehicles website.
Plug-In Electric Vehicle Credit - Vermont Electric Co-op (VEC)
VEC offers a $250 bill credit to members who purchase a new or pre-owned plug-in hybrid electric vehicle (PHEV) and a $500 bill credit to members who purchase a new or pre-owned all-electric vehicle (EV). Members who lease a PHEV are eligible for an annual bill credit of $50 for each year of the lease, and members who lease an EV are eligible for an annual bill credit of $100 for each year of the lease. For more information, including how to apply, see the VEC Energy Transformation Program website.
Electric Vehicle (EV) Charging Station Credits - Vermont Electric Co-op (VEC)
VEC offers a bill credit of $500 per connector, up to $1,000, to VEC member businesses and public entities that install Level 2 EV charging stations or direct current fast charging (DCFC) stations after July 1, 2017. To qualify, the EV charging stations must be available for public use. VEC also offers residential customers a $250 bill credit for the purchase of a Level 2 EV charging station. Members with eligible chargers may receive an additional upfront $50 incentive and an $8 monthly incentive for participating. For more information, including additional restrictions and how to apply, see the VEC Energy Transformation Program website
Plug-in Electric Vehicle and Off-Road Equipment Rebates - VPPSA
Vermont Public Power Supply Authority (VPPSA) member customers are eligible for rebates of up to $1,000 on the purchase of a new all-electric vehicle (EV), and up to $500 on the purchase of a new plug-in hybrid electric vehicle (PHEV). VPPSA also offers rebates of $500 for the purchase of a pre-owned EV and $250 for the purchase of a pre-owned PHEV. Low-income customers may receive an additional $400 rebate for a new EV or PHEV.
Additional rebates are available for the purchase of an electric forklift, residential or commercial lawnmower, and other yard care equipment.
For more information visit the VPPSA Electric Vehicle Rebate website.
Electric Vehicle (EV) Charging Station Incentive - Vermont Public Power Supply Authority (VPPSA)
VPPSA offers member customers a $500 rebate for the purchase of a Level 2 EV charging station. To qualify, the EV charging station must be installed for workplace or public use. For more information about these incentives, see the VPPSA Electric Vehicle Charging Station website.
Laws and Regulations
Voluntary Vehicle Retirement and Replacement Grant
The Vermont Agency of Transportation, in consultation with other state agencies, will administer the Replace Your Ride Program (Program) to reduce greenhouse gas (GHG) emissions and benefit low-income residents. The Program will provide up to $3,000 to qualified individuals, determined by income limits, for the retirement and replacement of internal combustion engine vehicles. Incentives will be offered on a first-come, first-served basis and limited to one per individual. For more information, see the Replace Your Ride - Network Action Team website.
(Reference Act 55, 2021)
Medium- and Heavy-Duty Zero Emission Vehicle (ZEV) Requirement
Vermont has adopted the California Advanced Clean Trucks requirements specified in Title 13 of the California Code of Regulations, requiring manufacturers to meet California’s ZEV production and sales requirements. Beginning with model year 2026, manufacturers will be required to sell zero-emission trucks as an increasing percentage of their annual sales for Class 2b through Class 8 vehicles in Vermont. ZEVs include all-electric and fuel cell electric vehicles. For more information, see the Vermont Department of Environmental Conservation Low Emission Vehicles website.
(Reference Code of Vermont Regulations 12-030-040)
Electric Vehicle (EV) Charging Station Multi-Unit Dwelling (MUD) Pilot Program
The Vermont Agency of Transportation must establish and administer, through a memorandum of understanding with the Department of Housing and Community Development (DHCD), a pilot program to support the installation of EV charging station at MUDs and affordable housing units. The DHCD must consult with other state agencies regarding the design, award of funding, and administration of this pilot program. The DHCD published a report on the outcomes of the pilot program on January 15, 2022. Additional terms and conditions apply.
(Reference Act 55, 2021)
Electric Vehicle (EV) Charging Station Deployment Goal
Vermont established a goal to deploy at least one public direct current fast charging (DCFC) station port within one mile of all interstate and highway exits and within 25 miles of other DCFC stations along state highways. In January 2023, the Vermont Agency of Transportation (AOT) published a map showing the locations of all public DCFC stations. AOT must update the map on an annual basis until this goal is met.
(Reference Act 55, 2021)
Electric Vehicle (EV) Mileage-Based User Fee
By July 1, 2025, the Vermont Agency of Transportation must begin collecting a mileage-based user fee from EV owners or lessees. The Secretary of Transportation and the Commissioner of Motor Vehicles must submit a comprehensive implementation plan to the Vermont Legislature by January 31, 2024.
(Reference House Bill 479, 2023)
Utility Company Electric Vehicle (EV) Rates
Utility companies must offer EV rates for public and private electric vehicle supply equipment by June 30, 2024. The EV rates must be approved by the Public Utility Commission (PUC). The PUC must submit a written report to the legislature on the progress towards this goal by January 15 of each year through 2025. The PUC published a report on January 14, 2022.
(Reference Act 55, 2021)
Electric Vehicle (EV) Definition
An EV is defined as a vehicle that can be powered by an electric motor that draws electricity from a battery and is capable of being charged from an external source. An EV includes both a vehicle that can only be powered by an electric motor that draws electricity from a battery (all-electric vehicle) and a vehicle that can be powered by an electric motor that draws electricity from a battery and by an internal combustion engine (plug-in hybrid electric vehicle).
(Reference Vermont Statutes Title 23, Chapter 4, Section 85)
Carbon Reduction Strategy
The Vermont Agency of Transportation (AOT) must develop a carbon reduction strategy. To do so, AOT must:
- Identify and evaluate the effectiveness of policies and programs to reduce transportation sector greenhouse gas (GHG) emissions;
- Work with stakeholders and the public to identify ways to reduce transportation sector GHG emissions; and,
- Determine how federal funds will be used to address transportation resilience.
(Reference House Bill 479, 2023)
Public Utility Definition
An entity that supplies electricity to the public exclusively to charge plug-in electric vehicles is not defined as a public utility and may charge for this electricity by the kilowatt-hour.
(Reference Vermont Statutes Title 30, Chapter 5, Section 203)
Electric Vehicle (EV) Fee
In addition to standard vehicle registration fees, EV owners must pay an annual registration fee of $74 and a biennial registration fee of $136.
(Reference Senate Bill 99, 2023)
Public Transportation Electrification Plan
The Vermont Agency of Transportation (VTrans), in consultation with public transit providers, must prepare a long-range plan that outlines the costs, timeline, training, maintenance, and operational actions required to move to a fully electrified public transportation fleet. VTrans filed the Zero Emissions Transition Plan on January 31, 2022.
(Reference Act 55, 2021)
Utility Electric Vehicle (EV) Program Funding Requirement
Investor-owned utility (IOU) companies must fund programs that modify or supplement their existing EV incentive programs and EV charging station grant programs. IOUs must prioritize low-income communities in their incentive programs.
(Reference Senate Bill 99, 2023)
Zero Emission Vehicle (ZEV) Sales Requirements and Low Emission Vehicle Standards
Vermont has adopted the California motor vehicle emissions standards and compliance requirements specified in Title 13 of the California Code of Regulations. These regulations apply to new vehicles with a gross vehicle weight rating of up to 14,000 pounds. Manufacturers must meet the greenhouse gas emissions standard and the ZEV production and sales requirements.
In December 2022, Vermont adopted the California vehicle emissions standards and compliance requirements set forth in the California Air Resources Board Advanced Clean Cars II regulation. These new emissions standards and requirements will begin with model year 2026 and require that 100% of new passenger vehicles sold in Vermont must be ZEVs by 2035.
(Reference Vermont Air Pollution Control Regulations 5-1101 through 5-1109)
Hybrid Electric Vehicle (HEV) and Electric Vehicle (EV) Acquisition Requirements
The Vermont Department of Buildings and General Services (Department) must, to the extent possible, purchase or lease HEVs or EVs for state use. Beginning July 1, 2021, at least 75% of the vehicles purchased or leased annually must be HEVs or EVs. The Department must acquire the lowest-cost make and model that meets the State’s needs.
(Reference Vermont Statutes Title 29, Chapter 49, Section 903 and House Bill 479, 2023)
Zero Emission Vehicle (ZEV) Deployment Support
Vermont joined California, Connecticut, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon, and Rhode Island in signing a memorandum of understanding (MOU) to support the deployment of ZEVs through involvement in a ZEV Program Implementation Task Force (Task Force). In May 2014, the Task Force published a ZEV Action Plan (Plan) identifying 11 priority actions to accomplish the goals of the MOU, including deploying at least 3.3 million ZEVs and adequate fueling infrastructure within the signatory states by 2025. The Plan also includes a research agenda to inform future actions. On an annual basis, each state must report on the number of registered ZEVs, the number of public electric vehicle (EV) charging stations and hydrogen fueling stations, and available information regarding workplace fueling for ZEVs.
In June 2018, the Task Force published a new ZEV Action Plan for 2018-2021. Building on the 2014 Action Plan, the 2018 Action Plan makes recommendations for states and other key partners in five priority areas:- Raising consumer awareness and interest in electric vehicle technology;
- Building out a reliable and convenient residential, workplace and public charging/fueling infrastructure network;
- Continuing and improving access to consumer purchase and non-financial incentives;
- Expanding public and private sector fleet adoption; and
- Supporting dealership efforts to increase ZEV sales.
For more information, see the ZEVs website.
Medium- and Heavy-Duty Zero Emission Vehicle (ZEV) Deployment Support
California, Colorado, Connecticut, District of Columbia, Hawaii, Maine, Maryland, Massachusetts, Nevada, New Jersey, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, and Washington (signatory states) signed a memorandum of understanding (MOU) to support the deployment of medium- and heavy-duty (MHD) ZEVs through involvement in a Multi-State ZEV Task Force (Task Force).
In July 2022, the Task Force published a multi-state action plan to support electrification of MHD vehicles. The action plan includes strategies and recommendations to accomplish the goals of the MOU, including limiting all new MHD vehicle sales in the signatory states to ZEVs by 2050, accelerating the deployment of MHD ZEVs, and ensuring MHD ZEV deployment also benefits disadvantaged communities.
For more information, see the Medium- and Heavy-Duty ZEVs: Action Plan Development Process website.
Automated Vehicle (AV) Testing and Operation Requirements
AVs may be operated on public highways for testing purposes if there is a licensed vehicle operator seated in the driver’s seat monitoring the safe operation of the AV and capable of taking immediate manual control of the vehicle in the event that the automated driving system fails. Before an AV may be tested on public highways, the Vermont Traffic Committee (Committee) must approve a permit application that defines the scope of the test and demonstrates the ability of the AV tester to comply with testing requirements. An approved AV tester is required to submit a report to the Committee annually, including information about AV safety, traffic operations, interaction with roadway infrastructure, and any public comments, until testing is complete.
The Vermont Agency of Transportation published the Vermont AV Testing Permit guide that includes a list of municipalities that have preapproved the testing of AVs in their jurisdictions. An AV is defined as any vehicle that is equipped with a technology that has the capability to operate the vehicle without the direct control of the driver.
(Reference Vermont Statutes Title 23, Chapter 41, Sections 4201-4203)
Natural Gas Tax
Natural gas used to propel a motor vehicle is not subject to the state gasoline tax, but is subject to state sales and use tax.
(Reference Vermont Statutes Title 32, Chapter 233, Section 9741, and Title 23, Chapter 28, Section 3101)
Idle Reduction Requirement
A driver may not idle a motor vehicle for more than five minutes in a 60-minute period. This limit does not apply if the vehicle is operating an auxiliary power unit, generator set, or other mobile idle reduction technology. Additional exemptions apply. Additionally, all driver education courses must include instruction on the adverse environmental, health, economic, and other impacts of unnecessary idling and on the law governing idling of motor vehicles.
(Reference Vermont Statutes Title 23, Chapter 28, Section 1110 and Title 16, Chapter 29, Section 1045)
School Bus Idle Reduction Requirement
School bus operators must turn off the bus engine immediately after arriving at a student loading and unloading area located on school grounds and may not start the engine until the bus is ready to leave the school grounds. In addition, operators may not idle the engine for more than five minutes in a 60-minute period on school grounds. Exceptions include periods when the engine is necessary to operate special equipment for disabled persons; to address safety, traffic, health, or emergency concerns; or to service the vehicle.
(Reference Vermont Statutes Title 23, Chapter 13, Section 1282 and Vermont State Board of Education Rules and Practices 6001 through 6005)
Neighborhood Electric Vehicle (NEV) Access to Roadways
An NEV is defined as an electric vehicle that is designed to operate at speeds of up to 25 miles per hour (mph); carries up to four people; has at least four wheels and a gross vehicle weight rating of less than 3,000 pounds; and conforms to the minimum safety equipment requirements as adopted in Title 49 of the (https://www.govinfo.gov/app/collection/cfr)[U.S. Code of Federal Regulations], section 571.500. An NEV may only be used on roads with a posted speed limit of up to 35 mph. The operator of an NEV may cross a highway that has a speed limit of up to 50 mph if the crossing begins and ends on a road authorized for use by NEVs and the intersection has a traffic control signal. The State Traffic Committee or the legislative body of a municipality for town highways may prohibit NEVs from crossing specific intersections in their jurisdiction if the decision is made in the interest of public safety.
(Reference Vermont Statutes Title 23, Chapter 1, Section 4, and Title 23, Chapter 13, Sections 1007a and 1043)