Bioenergy Incentives
State
The Hybrid Electric Vehicle (HEV) Rebate Program, administered by the Arkansas Energy Office, provides an incentive to state agencies to purchase new HEVs. HEVs that currently qualify are the Toyota Prius, Honda Civic Hybrid and Honda Insight. The incentive covers the sales tax paid for the HEV. A rebate application must be submitted within six months of the delivery and registration of the vehicle. Rebates are available on a first-come, first-served basis until available funds are exhausted. If your Arkansas state agency is interested in this program, please call 800-558-2633 or visit the link above.
An income tax credit is available to biodiesel suppliers for up to 5 percent of the costs of the facilities and equipment used in the wholesale or retail distribution of biodiesel fuels. The credits may be carried forward for three years. The cost does not include land, taxes, or services. (Reference: Arkansas Code 15-4-2104 and 2105)
A biodiesel supplier is entitled to a tax refund equal to fifty cents for
each gallon of biodiesel fuel that is used by the supplier to produce a
biodiesel mixture that contains not more than two percent biodiesel and
that is for sale by the supplier or for use by the supplier in a trade or
business. (Reference: House Bill 2657, 2005 and Arkansas Code
15-4-2803)
For more information, see Arkansas Incentives and Laws.
Federal
To encourage ethanol use, the federal government exempts 5.3 cents per gallon of 10-percent ethanol blend (53 cents per gallon of ethanol) of the 18.3 cents per gallon federal fuel excise tax. In effect since 1979, this credit makes ethanol competitive for fuel additive use.
The Energy Policy Act of 2005 will provide a federal excise tax credit for biodiesel as a tax incentive for petroleum distributors who blend biodiesel with diesel fuel into both on-road and off-road markets. The incentive equates to $1.00 per gallon of biodiesel made from virgin vegetable oils (like soy) and animal fats, and $0.50 per gallon for biodiesel made from recycled oils (subject to funding appropriation.) Newly purchased, qualified electric vehicles and clean-fuel vehicles (including gasoline/electric hybrids) are eligible for federal income tax incentives:
Purchasers of hybrid and advanced lean-burn diesel vehicles can receive a federal tax credit of up to $3,400. This will be capped at 60,000 vehicles per manufacturer and will expire in 2014. For medium and heavy hybrid trucks the tax credit will expire in 2009, and for leanburn diesel vehicles, the tax credit will expire in 2010. Electric vehicles are eligible for a one-time tax credit of 10 percent of the vehicle cost, up to $4,000 per vehicle. The credit will be reduced to $1,000 in 2006 and will expire at the end of that year.
For more information, visit these links from Guide to Federal Biofules Incentives, which was developed through Washington State Senatot Maria Cantwell who has worked diligently to create incentives to encourage biofuel production, the installation of biofuel pumps at gas stations, and the use of biofuels. To help individuals and corporations navigate and access the various federal programs and grants available, Senator Cantwell has released this comprehensive guide.
- Tax Credits for Renewable Electricity, Ethanol, Biodiesel, and Fueling Stations
- Grants for Electrification, Biomass, and Biofuels
- Loan Programs for Biomass
- Research and Development Assistance for Bioengery, Biofuel, Bioeconomy, and Education
- Maria's efforts to promote homegrown biofuels
- Printable version of Comprehensive Guide to Federal Biofuel Incentives