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 (11)
• Utility / Private Incentives (5)
• Laws and Regulations (23)

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 $52,500 or less and an electric range of at least 30 miles, on a first-come, first-served basis. Incentives are offered in the following amounts:

Tax Filing Status	Adjusted Gross Income Limits for Enhanced and Standard Incentives	State Incentive Amount
		Plug-in Hybrid Electric Vehicle	All-Electric Vehicle
Individual filing as single; or Married filing separately	$60,000 or less	$3,000	$5,000
	$60,001 up to $100,000	$1,500	$2,500
Individual filing as head of household	$75,000 or less	$3,000	$5,000
	$75,001 up to $125,000	$1,500	$2,500
Married filing jointly; or Individual filing as qualifying widower	$90,000 or less	$3,000	$5,000
	$90,001 up to $150,000	$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, see the Drive Electric Vermont website.

(Reference Act 62, 2023, Act 55, 2019, Act 154, 2020, and Act 184, 2022)

Fuel-Efficient Vehicle Incentive

The Vermont Agency of Transportation administers the Used High Fuel Efficiency Vehicle Incentive 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. For more information, see the MileageSmart website.

(Reference Act 59, 2019 and Act 62, 2023)

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 Diesel Emissions Reduction Assistance website.

Vehicle Emission Reduction Incentive

The Vermont Department of Environmental Conservation (DEC) administers the Automotive Emissions Repair Assistance Program (AERAP), which offers vouchers of up to $2,500 for the repair of vehicles that failed the on-board diagnostic II (OBD II) systems inspection. Eligible vehicles for a repair voucher are those that have failed the OBD II systems inspection, require repairs that are not under warranty, and will be able to pass the inspection once the repairs are made. Applicant total gross household income must be less than or equal to 185% of the Federal Poverty Level. For more information, see the DEC AERAP website.

(Reference Act 59, 2019 and Act 55, 2021)

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 chargers 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.

Multifamily Housing (MFH) Electric Vehicle (EV) Charger 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 chargers at MFH. Eligible applicants include governments, businesses, non-profits, homeowner associations, residential property owners, electric utilities, and EV charging equipment providers. Funding may be used for planning, permitting, purchase, installation, and other one-time costs associated with installing EV chargers. Additional terms and conditions apply. For more information, see the DHCD EV Chargers for Multi-Unit Residences website.

Vehicle Replacement Grant

The Vermont Agency of Transportation administers the Replace Your Ride Program which provides grants of up to $5,000 to qualified individuals for the retirement and replacement of internal combustion engine vehicles with a new or pre-owned all-electric or plug-in hybrid electric vehicle. Incentives are available in the following amounts:

Applicants may receive a maximum of one grant. Grants are available on a first-come, first-served basis. Additional terms and conditions apply. For more information, including application and eligibility requirements, see the Drive Electric Vermont website.

(Reference Act 55, 2021 and Act 62, 2023)

Workplace Electric Vehicle (EV) Charger 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 chargers at workplaces. Eligible applicants include governments, businesses, and non-profit organizations. Funding may be used for planning, purchase, installation, and other one-time costs associated with installing EV chargers. Additional terms and conditions apply. For more information, see the DHCD EV Chargers for Vermont Workplaces website.

Public Attraction Electric Vehicle (EV) Charger Grant

The Vermont Department of Housing and Community Development (DHCD) offers grants for the installation of direct current (DC) fast chargers and Level 2 EV chargers at locations available to the general public. Applicants may receive up to $56,000 for Level 2 EV chargers, and up to $160,000 for DC fast chargers. Eligible applicants include governments, businesses, non-profit organizations, homeowner associations, residential property owners, electric utilities, and EV charging equipment providers. Funding may be used for planning, purchase, installation, and other one-time costs associated with installing EV chargers. Additional terms and conditions apply. For more information, see the DHCD [EV Chargers for Public Attractions] (https://www.chargevermont.com/) website.

Electric Vehicle (EV) Fleet Grant Program

The Vermont Agency of Transportation (VTrans) administers the Electrify Your Fleet Program, which provides up to $5,000 for the purchase or lease of EVs, including electric motorcycles and snowmobiles. Applicants may receive up to 20 grants each. Eligible applicants include local and state governments, businesses, and nonprofit organizations. Grants will be awarded on a first-come, first served basis. Additional terms and conditions apply. For more information, including application and eligibility requirements, see the VTrans Electrify Your Fleet Program website.

(Reference Act 62, 2023)

Utility / Private Incentives

Burlington Electric Department (BED) - Vermont

Burlington Electric Department (BED) is a municipal utility that operates in Vermont. This page provides a summary of the types of incentives provided by the utility related to alternative fuels and vehicles. For more information on these incentives, see the Burlington Electric Department (BED) website.

Residential Incentives

Non-Residential Incentives

Green Mountain Power (GMP) - Vermont

Green Mountain Power (GMP) is an investor-owned utility (IOU) that operates in Vermont. This page provides a summary of the types of incentives provided by the utility related to alternative fuels and vehicles. For more information on these incentives, see the Green Mountain Power (GMP) website.

Residential Incentives

Non-Residential Incentives

Stowe Electric - Vermont

Stowe Electric is a municipal utility that operates in Vermont. This page provides a summary of the types of incentives provided by the utility related to alternative fuels and vehicles. For more information on these incentives, see the Stowe Electric website.

Residential Incentives

Non-Residential Incentives

Vermont Electric Co-op (VEC) - Vermont

Vermont Electric Co-op (VEC) is a cooperative that operates in Vermont. This page provides a summary of the types of incentives provided by the utility related to alternative fuels and vehicles. For more information on these incentives, see the Vermont Electric Co-op (VEC) website.

Residential Incentives

Non-Residential Incentives

Vermont Public Power Supply Authority (VPPSA) - Vermont

Vermont Public Power Supply Authority (VPPSA) is a municipal utility that operates in Vermont. This page provides a summary of the types of incentives provided by the utility related to alternative fuels and vehicles. For more information on these incentives, see the Vermont Public Power Supply Authority (VPPSA) website.

Residential Incentives

Non-Residential Incentives

Laws and Regulations

Voluntary Vehicle Retirement and Replacement Grant

The Vermont Agency of Transportation (VTrans), in consultation with other state agencies, must administer the Replace Your Ride Program (Program) to reduce greenhouse gas emissions and benefit low-income residents. Incentives will be offered on a first-come, first-served basis and limited to one per individual. VTrans must submit a written report to the legislature on the effectiveness of the Program by January 31 each year following the year the incentive was offered. For more information, see the Drive Electric Vermont 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) Charger Multifamily Housing (MFH) 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 chargers at MFH 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. For more information, see the Multiunit Dwelling EV Charging Grant website.

(Reference Act 55, 2021)

Electric Vehicle (EV) Charger Deployment Goal

Vermont established a goal to deploy at least one public direct current (DC) fast charger port within one mile of all interstate and highway exits and within 25 miles of other DC fast chargers along state highways. In January 2023, the Vermont Agency of Transportation (VTrans) published a map showing the locations of all public DC fast chargers. VTrans 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 (VTrans) must begin collecting a mileage-based user fee from EV owners or lessees. The Secretary of Transportation and the Commissioner of Motor Vehicles submitted a comprehensive implementation plan to the Vermont Legislature in January 2024. For more information, see the VTrans Electric and Highly Fuel-Efficient Vehicle Road Usage Charge Study website.

(Reference Act 62, 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 15, 2024.

(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 (EV) 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 1, Section 4)

Carbon Reduction Strategy

The Vermont Agency of Transportation (VTrans) must develop a carbon reduction strategy. To do so, VTrans 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.

VTrans published a report detailing their findings in November 2023. For more information, see the VTrans Carbon Reduction Strategy website.

(Reference House Bill 479, 2023)

Public Utility Definition

An entity that sites, constructs, owns, operates, or controls a facility that supplies electricity to the public exclusively to charge 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 $89 and a biennial registration fee of $178. Plug-in hybrid electric vehicle owners must pay an annual registration fee of $44.50 and a biennial registration fee of $89.

(Reference House Bill 868, 2024)

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)

Electric Vehicle (EV) and EV Charger Program Supplementation Authorization

Between 2024 and 2026, electric utilities may use state funding to modify or supplement existing EV and EV charger incentive programs to incentivize individuals with high gasoline or diesel fuel use or individuals with low- to moderate-income to transition to EVs. Additional requirements apply.

(Reference Act 144, 2023)

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 charger grant programs. IOUs must prioritize low-income communities in their incentive programs.

(Reference Act 41, 2023)

Electric Vehicle (EV) and Plug-in Hybrid Electric Vehicle (PHEV) License Plates

The Vermont Commissioner of Motor Vehicles must begin issuing special vehicle license plates to owners of EVs and PHEVs no later than July 1, 2026, for first responder awareness. The Vermont Department of Motor Vehicles must submit testimony to the legislature on the progress of its efforts to implement license plates for EVs and PHEVs by March 15, 2025.

(Reference Senate Bill 309, 2024)

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. 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 868, 2024)

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) chargers 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 EV 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 (MHD) 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 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 MHD 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 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 13, Section 1110 and Title 16, Chapter 23, 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 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)