Financial Incentives
Federal, Commonwealth of Virginia, Local Government, and private incentives
Alternative Fuels, Vehicles and Transit | Renewable Energy | Energy Conservation | Research and Development
Incentives for Alternative Fuels, Vehicles and Transit
Alternative Fuel Vehicle Fleet Buyer's Guide
Federal Tax Deduction
Clean Fuel Vehicle and Certain Refueling Property
General instructions: A credit may be claimed for: 10% of the deduction allowed under IRC Section 179A for the purchase of clean fuel vehicles, including hybrid vehicles, principally garaged in Virginia, or for the purchase of refueling property placed in service in Virginia; or 10% of the total costs used to compute the credit for electric vehicles under IRC Section 30. Individual filers complete Schedule CR, Part VIII, and corporate filers complete Form 500CR, Part IX, to claim this credit. For clean fuel vehicles, provide a property description. For qualified electric vehicles for which a federal credit was claimed, federal Form 8834 must also be attached. For refueling property, attach a copy of federal Form 4562 or other form showing computation of the Federal Section 179A deduction. Unused credits may be carried forward for five years.
- If you claimed a clean fuel vehicle deduction on your federal return, you may claim a credit on your Virginia return equal to 10% of the amount deducted on your federal return, not to exceed your Virginia tax liability. As explained in the general instructions, you must provide a description of the property for which the credit is being claimed. In lieu of a separate statement, you may write directly on the individual Schedule CR or the corporate Form 500CR. For example, if you claimed a clean fuel vehicle deduction on your federal individual income tax return for the purchase and use of a Honda Insight (hybrid vehicle), you should complete Schedule CR, Part VIII, Lines 30 through 34, and write next to line 30, "Clean Fuel Vehicle - Honda Insight".
- If you claimed a credit for qualified electric vehicles on your federal return, you may claim a credit on your Virginiareturn equal to 10% of the cost used to compute the federal credit.
- If you claimed a deduction for clean fuel vehicle refueling property on your federal return, you may claim a credit on your Virginiareturn equal to 10% of the amount deducted on your federal return, not to exceed your Virginiatax liability.
Reference:Virginia Code 58.1 - 438.1.
Electric Vehicle Tax Credit
AFV Rebate
Laws and Regulation
Effective July 1, 1994, local governments have the option of reducing personal property taxes or waiving license fees for AFVs or both. (Reference Virginia Code Sec. 58.1-3506)
Currently these local governments provide alternative fuel vehicle incentives:
State Energy Program
U.S. Department of Transportation (DOT)
Federal Transit Administration (FTA)
The Congestion Mitigation and Air Quality (CMAQ) Improvement Program was reauthorized in 2005 under the Safe, Accountable, Flexible, and Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU). The SAFETEA-LU CMAQ program provides over $8.6 billion dollars in funds to State DOTs, MPOs, and transit agencies to invest in projects that reduce criteria air pollutants regulated from transportation-related sources over a period of five years (2005-2009). The CMAQ program funds projects and programs in non-attainment and maintenance areas to reduce transportation-related emissions. For more information: http://www.fhwa.dot.gov/environment/cmaqpgs/index.htm.
To find your regional FTA refer to the contacts list at the end of this section. The Clean Fuels Grant Program was designed to accelerate the deployment of advanced bus technologies by supporting the use of low-emission vehicles in transit fleets. The program assists transit agencies in purchasing low emission buses and related equipment, constructing alternative fuel stations, modifying garage facilities to accommodate clean fuel vehicles, and assisting in the utilization of biodiesel fuel. For more information, visit the FTA Web site at http://www.fta.dot.gov/funding/grants/grants_financing_3560.html.
Bus and Bus-Related Grants help finance bus and bus-related capital projects that benefit the country's transit systems. Funding is provided for the acquisition of buses for fleet and service expansion, bus maintenance and administrative facilities, transfer facilities, bus malls, transportation centers, bus rebuilds, bus preventive maintenance, garage equipment, and more. For additional information, visit the FTA Web site at http://www.fta.dot.gov/funding/grants/grants_financing_3557.html.
Urbanized Area Formula Grants provide funding to urbanized areas and states for transit-related purposes. Eligible projects focus on capital investments in bus and bus-related activities; planning, design, and evaluation of transit projects and other technical transportation-related studies; and capital investments in new and existing fixed guideway systems. For more information, visit the FTA Web site at http://www.fhwa.dot.gov/tea21/factsheets/urbnfg.htm.
The Clean Fuel Fleet Program (CFFP) is an initiative implemented by the EPA in response to the CAAA. The CFFP requires fleets in cities with significant air quality problems to incorporate vehicles that will meet clean fuel emissions standards. For more information on requirements, covered fleets, and affected areas, please visit one of the following EPA Web sites: http://www.epa.gov/OMSWWW or http://www.epa.gov/otaq/cff.htm.
Air Pollution Control Program
This program, known as Section 105 grants, assists state and municipal agencies in planning, developing, establishing, improving, and maintaining adequate programs for prevention and control of air pollution or implementation of national air quality standards. States and municipalities may receive up to 60% federal funds to implement their plans. Requests for application forms and completed applications are submitted to the appropriate EPA Regional Grants Administration Branch. For program information, contact Jerry Stubberfield, EPA, at 919.541.0876 or email stubberfield.jerry@epamail.epa.gov.
Utilities/Private Incentives
Virginia Natural Gas will provide technical support and training to customers who are interested in starting a natural gas vehicle (NGV) fleet. Virginia Natural Gas offers refueling station support through one of two rates offered specifically for NGVs. In addition, the utility has five refueling stations available 24 hours a day with card access for customers. For more information, please contact Dave Crouch at 757.466.5446, or via email at dcrouch@aglr.com.
Washington Gas supports the use of NGVs and provides 17 public refueling stations in the Washington, DC metropolitan area. For more information, please contact Richard Gehr at 703.750.4446, via email at rgehr@washgas.com, or the Web site at http://www.washgas.com.
The National Ethanol Vehicle Coalition (NEVC) is a non-profit corporation whose goals are to increase the introduction of E85 vehicles and use of ethanol based fuels, decrease the nation's dependence on imported energy resources, improve environmental quality, and stimulate the national economy. The NEVC educates the public about the benefits of using E85 as an alternative transportation fuel and offers financial assistance for the development and installation of public E85 fueling facilities and infrastructure. For more information, please contact Phil Lampert toll-free at 877.485.8595, via email at plampert@E85fuel.com, or visit the Web site at http://www.E85fuel.com.
Fuel
Federal Tax Credits:
Credit for Producing From a Nonconventional Source
Potential Applicants: Business and industry
Availability/Conditions: A credit against taxes is available for selling or producing fuel that comes from a nonconventional source. Qualified fuels include oil produced from shale and tar sands, gas produced from geopressured brine, Devonian shale, coal seams, or a tight formation, or biomass, and liquid, gaseous, or solid synthetic fuels produced from coal.
Incentives for Renewable Energy
The State-Based Anemometer Loan Program
The State-Based Anemometer Loan Program provides Virginia landowners an opportunity to quantify their wind resource with the objective to spur the development and use of wind energy throughout the state. Under the program grant, JMU received ten 20-meter anemometer towers with instrumentation. Each tower takes one year of measurement on-site for the duration of one year and then is relocated to a new site over the span of three years. This is meant to obtain data from thirty locations throughout the state. JMU also owns a 50-meter tower and will soon own a 40-meter tower as additions to the program. The data obtained from the towers is reported to the borrowers, and is used by Virginia and NREL to validate wind resource models.JMU is responsible for receiving applications of interested participants in the program, selecting which sites are most appropriate for the wind energy study, distribution and installation of the anemometers, and gathering and processing the data.
Christopher Wells is currently serving as the SBALP Administrator. He is responsible for selecting sites to install anemometers and to schedule the un-installation of anemometers. Sites are selected by evaluating applications sent in by homeowners. Christopher also serves as the main contact for parties interested about the program and to the borrowers. Currently, he is developing a Geographic Information System integrating county parcel data and a wind resource map of Virginia to make the program more proactive in site selection. This allows him to locate properties with desirable wind resource, contact the owner, and invite them to apply to the program. He is also using GIS to find sites in the national forest with favorable wind resource and accessibility upon which the forest service will allow the installation of anemometer towers. Christopher can be contacted at wellscg@jmu.edu.
Virginia Small Wind Incentives Program (VSWIP)
This program is intended to provide Virginia landowners an opportunity to buy down the cost of a small wind system, as to make the investment cost-effective in the sense of providing a life cycle cost comparable to that of fossil-generated electricity over the lifetime of the wind energy system. During the two-year program, it is proposed to award ten Virginia landowners grants of up to $10,000 each to bring down the initial capital cost of the turbine and support tower, and the expense of installing and commissioning the system. The longer-range goal of the project is to spur the confidence in wind energy necessary for Virginia to implement additional wind energy systems throughout the state, both small and large scale.
Term: September 2003 - September 2005
http://web.jmu.edu/vwec/vswip_program.htm
DoD Fuel Cell Climate Change Rebate Program
In 1995, Congress appropriated funds for the Office of the Deputy Under Secretary of Defense, Environmental Security (ODUSD-ES) to establish a competitive, cost-shared, near-term Climate Change Fuel Cell Program (H.R. 103-747). The overall goal of this incentive program is to expedite the market introduction of fuel cell systems. Currently, the program provides up to $1,000 per kilowatt of power plant capacity with a not to exceed limit of one-third of the total program cost (capital and installed costs, pre-commercial operation).
www.dodfuelcell.com/climate/index.html
Electricity Produced From Certain Renewable Resources
Potential Applicants: Business and industry
Availability/Conditions: A tax credit is available for electricity produced from certain renewable resources such as wind, close-loop biomass systems, and poultry litter. The credit amounts to $0.015 per kilowatt hour and is good for the first ten years of a facility built before July 1, 1999.
Administered by: The United States Department of Treasury, Internal Revenue Service.
Solar Energy Equipment Tax Exemption (Code of VA § 58.1-3661)
Potential Applicants: Business, Industry, and Residents
Availability/Conditions: This statute allows any county, city, or town to exempt or partially exempt solar energy equipment or recycling equipment from local property taxes. Eligible technologies include passive solar space heat, active solar water heat, active solar space heat, solar thermal electricity, and photovoltaics. Solar energy is defined as any "application that would otherwise require a conventional source of energy. "Recycling equipment is defined as equipment that is "integral to the recycling process and for use primarily for the purpose of abating or preventing pollution of the atmosphere or waters."
Administered by: The Virginia Department of Taxation. For more information visit www.dcs.ncsu.edu/solar/dsire/financial.html or contact Ken Jurman at 804.692.3222
Energy Credit
Potential Applicants: homeowners
Availability/Conditions: A 10 percent credit is available on a portion of an energy facility for certain solar heat, hot water, cooling, electric and geothermal electric investments.
Administered by: The United States Department of Treasury, Internal Revenue Service. For more information, click here.
Waste Motor Oil Burners
Potential Applicants: Virginia business facilities that accept waste motor oil from the public
Availability/Conditions: A credit is offered for equipment used exclusively for burning waste motor oil at a business facility. The credit is equal to fifty percent of the purchase price paid during the taxable year. The total credit allowed to any taxpayer under this section in any taxable year will not exceed $5,000.
The taxpayer must submit with his income tax return such receipts, invoices, and other documentation necessary to confirm the taxpayer's statement of the purchase price paid for the waste motor oil burning equipment. The tax credit is only applicable to the taxable year during which the equipment was purchased.
Administered by: The Virginia Department of Taxation. The Virginia Department of Environmental Quality will certify that the equipment is used to burn waste motor oil at a business facility in Virginia and accepts waste motor oil from the public. For more information, contact Dan Gwinner at 804.698.4218
Virginia Renewable Energy Financial Incentives
Renewable energy financial incentives are offered by utilities, local governments, and federal governments. Renewable energy financial incentives can vary quite a bit as each local area strives to provide incentives to best meet energy needs and locally available renewable energy sources.
Renewable energy financial incentives are usually offered either based on the size of the system or the amount energy produced. If it is for the size of the system, for electric systems, they usually can be a rebate per kW, a flat rate, or a percentage of the system cost. Incentives based on the amount of electricity produced can be a more accurate method, as it is sizing to the true system production, but can also be more difficult to accurately measure. Most of these type of systems are offered by a utility where they can more easily verify your actual production.
For more information, visit the website.
Federal Incentives for Renewable Energy
The Database of State Incentives for Renewable Energy (DSIRE) is a comprehensive source of information on state, local, utility, and selected federal incentives that promote renewable energy. Click here to access the information regarding Virginia.
Incentives for Energy Conservation
Low Income Loan Program for Energy Conservation Improvements
Potential Applicants: Low and moderate-income homeowners
Availability/Conditions: The program offers low interest loans for repairs that reduce energy consumption or reduce dependence on conventional energy sources. All renewable energy technologies are eligible. The interest rate is 6.27 percent and amounts range from $1,000 to $25,000.
Administered by: The Virginia Housing Development Authority. For more information, contact Julia Perkinson at 804.782.1986
Incentives for Research and Development
Department of Energy funding for industry developing energy saving technology
Department of Energy funding small businesses developing energy saving inventions
Department of Energy e-Center providing financial incentives and business oppurtunities
Department of Energy State Energy Program
The Virginia Department of Housing and Community Development Weatherization Assistance Program provides funding to low-income families to reduce heating and cooling costs.
Grants through the Turner Foundation for Energy