Federal Laws and Incentives for Natural Gas
Take a look at the list from the U.S. Department of Energy that contains summaries of all laws and incentives associated with Natural Gas. Click the button below to learn more.
Programs and Incentives
In an effort to reduce America’s dependence on foreign oil, reduce urban emissions and reduce greenhouse gases, the federal government, state governments and even regional and local governments have implemented incentives to encourage the purchase and use of NGVs. These include tax deductions/credits, reduced license fees, reduced vehicle sale taxes, and lower registration fees. Some states also permit certain alternative fuel vehicles to operate in high occupancy vehicle (HOV) lanes during peak rush-hour periods.
The Energy Policy Act (EPAct) of 2005, PL 109–58, provides for an income tax credit equal to 30 percent of the cost of natural gas refueling equipment, up to $30,000 in the case of large stations and $1,000 for home refueling appliances. The credit went into effect after December 31, 2005 and after expiring has remained available through extensions. The most recent extension of this incentive occurred on February 9, 2018 when it was included in the Bipartisan Budget Act of 2018 (HR 1892; PL 115-123, § 40404). This law retroactively extends the incentive through 2017. Persons intending to take advantage of tax credits should consult with their tax advisors to understand how best to take advantage these provisions and also whether any limitations exist.
For more information on the income tax credits of alternative fuel infrastructure, visit the Federal Incentive for Alternative Fuel Infrastructure page.
The Department of Energy funded 25 different projects for alternative fuel, infrastructure and advanced technology vehicle, and 19 of these 25 projects include NGVS. The Federal Transit Administration also awarded about $100 million in funding for more cities to switch to natural gas buses. Together these programs will result in:
- 3,000 new natural gas vehicles, including 600 heavy duty trucks that will be powered with liquefied natural gas, or LNG.
- 140 new fueling stations, including 10 that will fuel heavy-duty trucks with liquefied natural gas.
- More than 200 new natural gas powered buses, and the repowering of more than 400 existing natural gas buses, plus the building of several new fueling stations for these bus fleets. Several states have used the Energy Block Grant funding to set aside money for NGV development.
Securing funding is critical to the success of efforts to cut petroleum use in transportation. Funding opportunities for Clean Cities projects are available from many sources inside and outside the U.S. Department of Energy (DOE).
Clean Cities has awarded nearly $400 million to fund hundreds of projects across the country that cut petroleum use in transportation. Learn more about Clean Cities projects.
Chronology of Legislation