Electricity Laws and Incentives in Kentucky
The list below contains summaries of all Kentucky laws and incentives related to electricity.
Laws and Regulations
Alternative Fuel Vehicle (AFV) Acquisition Requirements
By January 1, 2026, the Kentucky Finance and Administration Cabinet (Cabinet) must increase the use of ethanol, biodiesel, and other alternative transportation fuels and replace at least 50% of light-duty state fleet vehicles with new AFVs or vehicles equipped with low-emission technology. Beginning December 1, 2024, the Cabinet must compile annual reports detailing the progress made towards these requirements, including a life-cycle cost assessment, vehicle replacement timeline, and targets for increased alternative fuels in state agency vehicles.
Alternative Fuel and Conversion Definitions
Clean transportation fuels include propane, compressed natural gas (CNG), liquefied natural gas (LNG), electricity, and other transportation fuels determined to be comparable with respect to emissions. Propane is defined as a hydrocarbon mixture produced as a by-product of natural gas processing and petroleum refining and condensed into liquid form for sale or use as a motor fuel. CNG is defined as pipeline-quality natural gas that is compressed and provided for sale or use as a motor vehicle fuel. LNG is defined as pipeline-quality natural gas treated to remove water, hydrogen sulfide, carbon dioxide, and other components that will freeze and condense into liquid form for sale or use as a motor vehicle fuel.
A bi-fuel system is defined as the power system for motor vehicles powered by gasoline and either CNG or LNG. Bi-fuel systems are considered clean fuel systems. Conversion is defined as repowering a motor vehicle or special mobile equipment by replacing its original gasoline or diesel powered engine with one capable of operating on clean transportation fuel or retrofitting a motor vehicle or special mobile equipment with parts that enable its original gasoline or diesel engine to operate on clean transportation fuel.
(Reference Kentucky Revised Statutes 186.750)
Electric Vehicle (EV) Charging Station Tax
Beginning on January 1, 2024, EV charging station owners and lessees must pay a combined excise tax and surtax fee of $0.03 per kilowatt hour of electricity used to charge EVs. The tax will be added to the selling price charged by the station operator. If the station operator provides free electricity, they will be responsible for paying the tax on stations installed after June 30, 2022. The station operator must report total kilowatt hours distributed, tax amount collected, and provide payment to the state monthly. Beginning December 1, 2024, the Kentucky Department of Revenue must compare the tax rate to the most current quarterly National Highway Construction Cost Index 2.0 (NHCCI 2.0) annually. Beginning on January 1, 2025, the tax rate must be adjusted annually to match the NHCCI 2.0 change, up to a maximum 5% annual increase or decrease.
(Reference Kentucky Revised Statutes 186.010 and 189.282)
Electric Vehicle (EV) Fee
Beginning January 1, 2024, in addition to standard vehicle registration fees, EV owners must pay an annual fee of $120 and hybrid electric vehicle and electric motorcycle owners must pay an annual fee of $60.
(Reference Kentucky Revised Statutes 138.32)
Public Utility Definition
An entity that owns or operates an electric vehicle charging station is not defined as a public utility.
Utility / Private Incentives
Electric Vehicle (EV) Charging Station Rebate – Tennessee Valley Authority (TVA)
TVA will establish and fund a network of direct current fast charging (DCFC) stations every 50 miles along interstates and major highways through the Fast Charge Network Program (Program). The Program offers funding for public DCFC stations along EV corridor gaps, up to $150,000 per DCFC station. Eligible applicants include TVA Local Power Companies, and eligible projects must include a minimum of two DCFC ports per location. Program participants must identify suitable host sites and agree to own, operate, and maintain Program-funded DCFC stations for a minimum of five years. For more information, including guidelines and additional eligibility requirements, see the TVA Fast Charge Network website.
Electric Vehicle (EV) Infrastructure Support
Kentucky utilities joined the National Electric Highway Coalition (NEHC), committing to create a network of direct current fast charging (DCFC) stations connecting major highway systems from the Atlantic Coast to the Pacific of the United States. NEHC utility members agree to ensure efficient and effective fast charging deployment plans that enable long distance EV travel, avoiding duplication among coalition utilities, and complement existing corridor DCFC sites. For more information, including a list of participating utilities and states, see the NEHC website.
Kentucky’s National Electric Vehicle Infrastructure (NEVI) Planning
The U.S. Department of Transportation’s (DOT) NEVI Formula Program requires the Kentucky Transportation Cabinet 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.
More Laws and Incentives
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