Hydrogen Laws and Incentives in Federal

The list below contains summaries of all Federal laws and incentives related to hydrogen.

Incentives

Airport Zero Emission Vehicle (ZEV) and Infrastructure Incentives

The Zero Emissions Airport Vehicle and Infrastructure Pilot Program provides funding to airports for up to 50% of the cost to acquire ZEVs and install or modify supporting infrastructure for acquired vehicles. Grant funding must be used for airport-owned, on-road vehicles used exclusively for airport purposes. Vehicles and infrastructure must meet the Federal Aviation Administration's Airport Improvement Program requirements, including Buy American requirements. To be eligible, an airport must be for public use. The program will give priority to applicants located in nonattainment areas, as defined by the Clean Air Act, and projects that achieve the greatest air quality benefits, as measured by the amount of emissions reduced per dollar of funds spent under the program. For more information, see the Zero Emissions Airport Vehicle and Infrastructure Pilot Program website. (Reference Public Law 112-95 and 49 U.S. Code 47136a)

Alternative Fuel Corridor (AFC) Grants

The U.S. Department of Transportation (DOT) must establish a competitive grant program to strategically deploy publicly accessible electric vehicle charging and hydrogen, propane, and natural gas fueling infrastructure along designated DOT Federal Highway Administration AFCs. The grant will provide funding for designated Corridor-Pending AFCs to install infrastructure to convert to Corridor-Ready AFCs, and for Corridor-Ready AFCs to install alternative fuel infrastructure to provide station redundancy and meet higher demand. Propane fueling infrastructure is limited to use by medium- and heavy-duty vehicles. Eligible entities include states, metropolitan planning organizations, local governments, political subdivisions, and tribal governments. Additional funding eligibility and considerations will apply. The grant program must be established by November 15, 2022. (Reference Public Law 117-58 and 23 U.S. Code 151)

Alternative Fuel Excise Tax Credit

NOTE: This incentive was originally set to expire on December 31, 2021, but has been extended through December 31, 2024, by Public Law 117-169.

A tax incentive is available for alternative fuel that is sold for use or used as a fuel to operate a motor vehicle. A tax credit in the amount of $0.50 per gallon is available for the following alternative fuels: natural gas, liquefied hydrogen, propane, P-Series fuel, liquid fuel derived from coal through the Fischer-Tropsch process, and compressed or liquefied gas derived from biomass. For propane and natural gas sold after December 31, 2015, the tax credit is based on the gasoline gallon equivalent (GGE) or diesel gallon equivalent (DGE). For taxation purposes, one GGE is equal to 5.75 pounds (lbs.) of propane and 5.66 lbs. of compressed natural gas. One DGE is equal to 6.06 lbs. of liquefied natural gas.

For an entity to be eligible to claim the credit they must be liable for reporting and paying the federal excise tax on the sale or use of the fuel in a motor vehicle. Tax exempt entities such as state and local governments that dispense qualified fuel from an on-site fueling station for use in vehicles qualify for the incentive. Eligible entities must be registered with the Internal Revenue Service (IRS). The incentive must first be taken as a credit against the entity’s alternative fuel tax liability; any excess over this fuel tax liability may be claimed as a direct payment from the IRS. The tax credit is not allowed if an incentive for the same alternative fuel is also determined under the rules for the ethanol or biodiesel tax credits.

For more information about claiming the credit, see IRS Form 4136, which is available on the IRS Forms and Publications website.

(Reference 26 U.S. Code 6426 and Public Law 117-169)

Point of Contact
Excise Tax Branch
U.S. Internal Revenue Service Office of Chief Counsel
Phone: (202) 317-6855
http://www.irs.gov/

Alternative Fuel Infrastructure Tax Credit

Fueling equipment for natural gas, propane, liquefied hydrogen, electricity, E85, or diesel fuel blends containing a minimum of 20% biodiesel installed through December 31, 2022, is eligible for a tax credit of 30% of the cost, not to exceed $30,000. Permitting and inspection fees are not included in covered expenses. Fueling station owners who install qualified equipment at multiple sites are allowed to use the credit towards each location. Unused credits that qualify as general business tax credits, as defined by the Internal Revenue Service (IRS), may be carried backward one year and carried forward 20 years. For more information about claiming the credit, see IRS Form 8911, which is available on the IRS Forms and Publications website.

Beginning January 1, 2023, fueling equipment for natural gas, propane, hydrogen, electricity, E85, or diesel fuel blends containing a minimum of 20% biodiesel, is eligible for a tax credit of 30% of the cost or 6% in the case of property subject to depreciation, not to exceed $100,000. Permitting and inspection fees are not included in covered expenses.

Eligible fueling equipment must be installed in locations that meet the following census tract requirements:

  • A population census tract where the poverty rate is at least 20%; or

  • Metropolitan and non-metropolitan area census tract where the median family income is less than 80% of the state medium family income level.

Eligible projects must also meet apprenticeships and prevailing wage requirements.

Consumers who purchase qualified residential fueling equipment between January 1, 2023, and December 31, 2032, may receive a tax credit of up to $1,000.

(Reference 26 U.S. Code 30C, 30D, and 38 and Public Law 117-169)

Point of Contact
U.S. Internal Revenue Service
Phone: (800) 829-1040
http://www.irs.gov/

Alternative Fuel Tax Exemption

Alternative fuels used in a manner that the Internal Revenue Service (IRS) deems as nontaxable are exempt from federal fuel taxes. Common nontaxable uses in a motor vehicle are: on a farm for farming purposes; in certain intercity and local buses; in a school bus; for exclusive use by a non-profit educational organization; and for exclusive use by a state, political subdivision of a state, or the District of Columbia. This exemption is not available to tax exempt entities that are not liable for excise taxes on transportation fuel. For more information, see IRS Publication 510. (Reference 26 U.S. Code 4041)

Point of Contact
Excise Tax Branch
U.S. Internal Revenue Service Office of Chief Counsel
Phone: (202) 317-6855
http://www.irs.gov/

Alternative Fuel and Advanced Vehicle Technology Research and Demonstration Bonds

Qualified state, tribal, and local governments may issue Qualified Energy Conservation Bonds subsidized by the U.S. Department of Treasury at competitive rates to fund capital expenditures on qualified energy conservation projects. Eligible activities include research and demonstration projects related to cellulosic ethanol and other non-fossil fuels, as well as advanced battery manufacturing technologies. Government entities may choose to issue tax credit bonds or direct payment bonds to subsidize the borrowing costs. For information on eligibility, processes, and limitations, see IRS Notices 2009-29, 2010-35, and 2012-44 or contact local issuing agencies. (Reference 26 U.S. Code 54D)

Carbon Reduction Program (CRP)

The U.S. Department of Transportation (DOT) must establish a carbon reduction formula program for states to reduce transportation emissions. Eligible state funding activities include truck stop electrification, diesel engine retrofits, vehicle-to-infrastructure communications equipment, public transportation, port electrification, and deployment of alternative fuel vehicles, including charging or fueling infrastructure and the purchase or lease of zero emission vehicles. Funding can also be used to support the development of state carbon reduction strategies, in consultation with designated metropolitan planning organizations, by November 15, 2023. At the request of a state, DOT must provide technical assistance in the development of the carbon reduction strategy. State projects will be treated as Federal-aid Highway Program projects. Additional funding eligibility and considerations will apply. For more information, see the CRP Implementation Guidance and Fact Sheet.

(Reference Public Law 117-58 and 23 U.S. Code 1)

Clean School Bus

The U.S. Environmental Protection Agency’s (EPA) Clean School Bus program provides funding to eligible applicants for the replacement of existing school buses with clean, alternative fuel school buses or zero-emission school buses. EPA may award up to 100% of the cost of the replacement bus, charging equipment, or fueling infrastructure. Alternative fuels include electricity, natural gas, hydrogen, or propane. Eligible applicants are school districts, state and local government programs, federally recognized Indian tribes, non-profit organizations, and eligible contractors. EPA will prioritize funding for high-need local education agencies; low income, rural and tribal schools; and, applications that cost share through public-private partnerships, grants from other entities, or school bonds. For more information, including funding availability, timeline, and application materials, see the EPA Clean School Bus website.

(Reference Public Law 117-58 and 42 U.S. Code 16091)

Point of Contact
DERA Helpline
Diesel Emissions Reduction Act
U.S. Environmental Protection Agency
Phone: (877) 623-2322
dera@epa.gov
https://www.epa.gov/dera

Commercial Electric Vehicle (EV) and Fuel Cell Electric Vehicle (FCEV) Tax Credit

Beginning January 1, 2023, a tax credit will be available to businesses for the purchase of new EVs and FCEVs. Vehicles with a gross vehicle weight rating (GVWR) below 14,000 pounds (lbs.) must have a battery capacity of at least seven kilowatt-hours (kWh) and vehicles with a GVWR above 14,000 lbs. must have a battery capacity of at least 15 kWh. The tax credit amount is equal to the lesser of the following amounts:

  • 15% of the vehicle purchase price for plug-in hybrid electric vehicles
  • 30% of the vehicle purchase price for EVs and FCEVs
  • The incremental cost of the vehicle compared to an equivalent internal combustion engine vehicle

Maximum tax credits may not exceed $7,500 for vehicles under 14,000 lbs. and $40,000 for vehicles above 14,000 lbs. Businesses may not combine this tax credit with the Clean Vehicle Tax Credit.

(Reference Public Law 117-169)

Point of Contact
U.S. Internal Revenue Service
Phone: (800) 829-1040
http://www.irs.gov/

Community Alternative Fuel Infrastructure Grants

The U.S. Department of Transportation (DOT) shall establish a competitive grant program to fill gaps in publicly accessible electric vehicle charging and hydrogen, propane, and natural gas fueling infrastructure in community locations, such as a parking facilities, public schools, public parks, or along public roads. Funding of up to 80% of project costs will be available for both development-phase planning activities and the acquisition and installation of charging or alternative fueling infrastructure. Five percent of the grant fund awarded may be used for educational and community engagement activities to develop and implement education programs through partnerships with schools, community organizations, and vehicle dealerships to support the use of zero-emission vehicles and associated infrastructure. DOT must prioritize projects that expand access to charging and alternative fueling infrastructure within rural areas, low- and moderate-income neighborhoods, and communities with limited parking space or a high ratio of multi-unit dwellings to single-family homes. Eligible entities include states, metropolitan planning organizations, local governments, political subdivisions, and tribal governments. Additional funding eligibility and considerations will apply. (Reference Public Law 117-58 and 23 U.S. Code 151)

Congestion Mitigation and Air Quality (CMAQ) Improvement Program

The CMAQ Program provides funding to state departments of transportation (DOTs), local governments, and transit agencies for projects and programs that help meet the requirements of the Clean Air Act by reducing mobile source emissions and regional congestion on transportation networks. Eligible activities include transit improvements, travel demand management strategies, congestion relief efforts (such as high occupancy vehicle lanes), diesel retrofit projects, alternative fuel vehicles and infrastructure, and medium- or heavy-duty zero emission vehicles and related charging equipment. Projects supported with CMAQ funds must demonstrate emissions reductions, be located in or benefit a U.S. Environmental Protection Agency-designated nonattainment or maintenance area, and be a transportation project. For more information, see the FAST Act CMAQ fact sheet and CMAQ Improvement Program website. (Reference Public Law 117-58, Public Law 112-141, 23 U.S. Code 149, and 23 U.S. Code 151)

Electric Vehicle (EV) Charging and Clean Transportation Grants

The U.S. Department of Energy (DOE) provides grants for transportation decarbonization research projects. Priority will be given to projects that include:

  • Cost-effective deployment of EV charging for those without access to home charging;
  • Innovative solutions to improve mobility options for underserved communities;
  • Community engagement to accelerate clean transportation options in underserved communities;
  • Research and development to reduce EV battery size and cost, increase EV battery range, and decrease EV battery emissions;
  • Electrification of off-road and non-road vehicles, including agricultural, construction, rail, marine, and aviation;
  • Materials technologies to improve EV efficiency and affordability;
  • Use of the alternative fuels in commercial off-road vehicle technologies, including natural gas, hydrogen, and renewable propane;
  • Planning and development of medium- and heavy-duty EV charging and hydrogen fueling corridors and advanced engine and fuel technologies to improve fuel economy and reduce greenhouse gas emissions

Applicants must demonstrate how proposed projects will benefit underserved communities that lack access to clean transportation options.

(Reference Public Law 109-58 and 42 U.S. Code 16191)

Electric Vehicle (EV) and Fuel Cell Electric Vehicle (FCEV) Manufacturing Loans

The U.S. Department of Energy (DOE) provides grants or loan guarantees through the Loan Guarantee Program for the domestic production of efficient hybrid vehicles, plug-in hybrid electric vehicles, all-electric vehicles, and hydrogen fuel cell electric vehicles,. The program is not intended for research and development projects. DOE may issue loan guarantees for at least 50% of the amount of the loan for an eligible project. Eligible projects may include the deployment of fueling infrastructure, including associated hardware and software, for alternative fuels. For loan guarantees of over 80%, the loan must be issued and funded by the Treasury Department’s Federal Financing Bank. For more information, see the DOE Loan Guarantee Program website and the Alternative Fuel Infrastructure fact sheet.

Point of Contact
Loan Guarantee Program
U.S. Department of Energy
Phone: (202) 586-8336
lgprogram@hq.doe.gov
http://www.energy.gov/lpo/loan-programs-office

Electric Vehicle (EV) and Fuel Cell Electric Vehicle (FCEV) Manufacturing Tax Credit

Qualified advanced energy projects are eligible for a 30% tax credit for project investments to reequip, expand, or establish certain manufacturing facilities. Credits cannot be allocated to projects located in census tracts where projects have been previously allocated. A qualifying advanced energy project includes, but is not limited to, projects that reequip, expand, or establish a manufacturing or industrial facility for the production or recycling of light-, medium-, and heavy-duty EVs, FCEVs, EV charging stations, and hydrogen fueling stations. Additional terms apply.

(Reference Public Law 117-169 and 26 U.S. Code 48C)

Point of Contact
U.S. Internal Revenue Service
Phone: (800) 829-1040
http://www.irs.gov/

Electric Vehicle (EV) and Fuel Cell Electric Vehicle (FCEV) Tax Credit

The Inflation Reduction Act of 2022 (Public Law 117-169) amended the Qualified Plug-in Electric Drive Motor Vehicle Credit (IRC 30D), now known as the Clean Vehicle Credit, and added a new requirement for final assembly in North America that took effect on August 17, 2022, with additional requirements taking place beginning January 1, 2023. More details are provided below by date and on the list of EVs with Final Assembly in North America.

Vehicle Purchases Before August 17, 2022

Qualifying EVs purchased before August 17, 2022, are eligible for a tax credit that is available for the purchase of a new qualified EV that draws propulsion using a traction battery that has at least four kilowatt-hours (kWh) of capacity, uses an external source of energy to recharge the battery, has a gross vehicle weight rating of up to 14,000 pounds, and meets specified emission standards. The minimum credit amount is $2,500, and the credit may be up to $7,500 based on each vehicle’s traction battery capacity and the gross vehicle weight rating. The credit will begin to be phased out for each manufacturer in the second quarter following the calendar quarter in which a minimum of 200,000 qualified PEVs have been sold by that manufacturer for use in the United States. This tax credit is also available for future EV owners with a written binding contract to purchase a new qualifying electric vehicle before August 16, 2022, but do not take possession of the vehicle until on or after August 16, 2022. For more information, including qualifying vehicles and sales by manufacturer, see the Internal Revenue Service (IRS) Qualified Plug-in Electric Drive Motor Vehicle Credit website.

Vehicle Purchases Between August 17 and December 31, 2022

Qualifying EVs purchased and delivered between August 17, 2022, and December 31, 2022, are eligible for the tax incentive as described above but are limited to vehicles with final assembly in North America. Manufacturer sales caps on vehicles apply. Note that for some manufacturers, the build location may vary based on the specific vehicle, trim, or the date in the Model Year when it was produced because some models are produced in multiple locations. The build location of a particular vehicle should be confirmed by referring to its Vehicle Identification Number (VIN) using the U.S. Department of Transportation’s VIN decoder or an information label affixed to the vehicle.

For more information, see EVs with Final Assembly in North America.

Vehicles Placed in Service After December 31, 2022

Beginning January 1, 2023, the Clean Vehicle Credit provisions remove manufacturer sales caps, expand the scope of eligible vehicles to include both EVs and FCEVs, require a traction battery that has at least seven kilowatt-hours (kWh), and establish criteria for a vehicle to be considered eligible that involve sourcing requirements for critical mineral extraction, processing, and recycling and battery component manufacturing and assembly. Vehicles that meet critical mineral requirements are eligible for $3,750 tax credit, and vehicles that meet battery component requirements are eligible for a $3,750 tax credit. Vehicles meeting both the critical mineral and the battery component requirements are eligible for a total tax credit of up to $7,500.

Critical Minerals: To be eligible for the $3,750 critical minerals portion of the tax credit, the percentage of the value of the battery’s critical minerals that are extracted or processed in the United States or a U.S. free-trade agreement partner or recycled in North America, must increase according to the following schedule:

Year Critical minerals minimum percent value requirement
2023 40%
2024 50%
2025 60%
2026 70%
2027 and later 80%

Battery Components: To be eligible for the $3,750 battery components portion of the tax credit, the percentage of the value of the battery’s components that are manufactured or assembled in North America must increase according to the following schedule:

Year Battery components minimum percent value requirement
2023 50%
2024 and 2025 60%
2026 70%
2027 80%
2028 90%
2029 and later 100%

To be eligible for the credits under these provisions, vans, sport utility vehicles, and pickup trucks must meet the additional requirements of not having a manufacturer suggested retail price (MSRP) above $80,000, and all other vehicles may not have an MSRP above $55,000. Additionally, the eligibility of individuals for the tax credit is further limited by thresholds for modified adjusted gross income (MAGI); only individuals having a MAGI below the following thresholds are eligible for the tax credit:

  • $300,000 for joint filers
  • $225,000 for head-of-household filers
  • $150,000 for single filers

Further guidance on these provisions is forthcoming. For more information, including additional eligibility requirements, see the IRS Plug-In Electric Drive Vehicle Credit website.

(Reference U.S. Code 30D and Public Law 117-169)

Point of Contact
U.S. Internal Revenue Service
Phone: (800) 829-1040
http://www.irs.gov/

Environmental Justice Community Technical Assistance Program

The U.S. Department of Energy (DOE) Communities Local Energy Action Program (LEAP) Pilot facilitates sustained, community-wide economic and environmental benefits through DOE’s clean energy deployment work. This technical assistance opportunity is specifically open to low-income, energy-burdened communities that are also experiencing either direct environmental justice impacts, or direct economic impacts from a shift away from historical reliance on fossil fuels. DOE will provide technical assistance services to support up to 36 communities to develop their own community-driven clean energy transition approach. For more information, visit the DOE Communities LEAP website.

Freight Efficiency and Zero-Emission Vehicle Infrastructure Grants

The U.S. Department of Transportation (DOT) Infrastructure for Rebuilding America (INFRA) grant program provides federal financial assistance to eligible transportation infrastructure projects that address climate change and environmental justice impacts, among other key objectives. Eligible projects include, but are not limited to, supporting a modal shift in freight or passenger movement to reduce vehicle miles traveled, developing zero-emission vehicle infrastructure, using one or more demand management strategies to reduce congestion and greenhouse gas emissions, and supporting the installation of electric vehicle charging stations along the National Highways System. Eligible applicants for INFRA grants are states, metropolitan planning organizations that serve urbanized areas with a population of more than 200,000 individuals, local governments, political subdivisions, port authorities, and tribal governments. Additional terms and conditions apply. For more information, including funding application deadlines, see the DOT INFRA Grants website.

Hydrogen Demonstration Project Grants

The Hydrogen Shot was established within the U.S. Department of Energy’s Energy Earthshots Initiative with the goal to reduce the cost of clean hydrogen by 80% to $1 per kilogram in one decade. Hydrogen Shot funds hydrogen demonstration projects that can help lower the cost of hydrogen, reduce carbon emissions and local air pollution, create good-paying jobs, and provide benefits to disadvantaged communities. Hydrogen Shot focuses on various projects that bridge technical gaps in hydrogen production, storage, and distribution and utilization technologies, including fuel cells. For more information, visit the Hydrogen Shot website.

Innovative Research and Development Competitive Prizes

The American-Made Challenges are a series of prize competitions, in partnership with the National Renewable Energy Laboratory, that are designed to incentivize the nation’s entrepreneurs to reenergize innovation, reassert American leadership in the energy marketplace, and connect entrepreneurs to the private sector and U.S. Department of Energy’s national laboratories. These challenges seek to lower the barriers U.S.-based innovators face by spurring manufacturing, developing innovative solutions and products, and creating new domestic jobs and opportunities through public-private partnerships. For more information, including current prize challenges, visit the American-Made Challenges website.

Low and Zero Emission Public Transportation Funding

The Department of Transportation’s Federal Transit Administration (FTA) administers the Low or No Emission Grant (Low-No) Program. Financial assistance is available to local and state government entities for the purchase or lease of low-emission or zero-emission transit buses, in addition to the acquisition, construction, or lease of supporting facilities. Eligible vehicles must be designated for public transportation use and significantly reduce energy consumption or harmful emissions compared to a comparable standard or low emission vehicle.

The Low-No Program is a competitive grant program. Funding is available through fiscal year (FY) 2026. $1.1 billion is available for FY 2022. Applicants must apply by May 31, 2022. Applicants must submit a zero-emission vehicle fleet transition plan to the FTA that includes a utility partnership description and workforce development training. For more information, including details about the current round of funding, see the Low or No Emission Grant (Low-No) Program website. (Reference Public Laws 117-58, 113-159, and 114-94, and 49 U.S. Code 5312 and 5339)

Point of Contact
Federal Transit Administration, Office of Program Management
U.S. Department of Transportation
Phone: (202) 366-2053
http://www.fta.dot.gov

Low or Zero Emission Ferry Program

The U.S. Department of Transportation (DOT) must establish a pilot grant program for the purchase of electric or low-emitting ferries and the electrification of or other reduction of emissions from existing ferries. Low-emitting ferries must use an alternative fuel, such as methanol, natural gas, propane, hydrogen, and electricity. Awards must include a ferry service that serves the State with the largest number of Marine Highway System miles and a bi-state ferry service with an aging fleet. Funding is authorized through fiscal year 2026. (Reference Public Law 117-58)

National Alternative Fuels Corridors

The U.S. Department of Transportation Federal Highway Administration (FHWA) designates a national network of plug-in electric vehicle (EV) charging and hydrogen, propane, and natural gas fueling infrastructure along national highway system corridors. To designate these Alternative Fuel Corridors (AFC), FHWA solicits nominations from state and local officials and works with other federal officials and industry stakeholders.

FHWA must establish an AFC grant program to award grants to eligible entities, by November 15, 2022. During the designation and redesignation process, in consultation with the U.S. Department of Energy, FHWA will issue a report identifying charging and fueling infrastructure, best practices and guidance for predictable infrastructure deployment, analyzing standardization needs for fuel providers and purchasers, and reestablishing the goal of achieving strategic deployment of fueling infrastructure in the designated corridors.

For the 2022 Request for Nominations, state and local officials must submit nominations to FHWA by May 13, 2022. FHWA must update and redesignate corridors periodically thereafter. States are encouraged to complete EV AFCs, which are eligible for separate funding from the National Electric Vehicle Infrastructure (NEVI) Formula Program, and will be considered fully built out once they meet the conditions specified in the NEVI Formula Program Guidance.

For more information, see the FHWA Alternative Fuel Corridors website. (Reference Public Law 117-58, Public Law 114-94, and 23 U.S. Code 151)

National Multimodal Cooperative Freight Research Program

The U.S. Department of Transportation (DOT) will establish a national cooperative freight transportation research program (Program), administered in collaboration with the National Academy of Sciences (NAS). NAS will establish an advisory committee to recommend a national research agenda on improvements in the efficiency and resiliency of freight movement, including adapting to future trends such as zero-emissions transportation. NAS may award research contracts or grants under the Program.

DOT shall establish the Program by November 15, 2022, and publish annual reports describing the ongoing research and findings. Funding will be made available each fiscal year until November 15, 2026, and will remain available until expended for this Program.

(Reference Public Law 117-58 and 49 U.S. Code 702)

Port Electrification Grants

The U.S. Environmental Protection Agency (EPA) must establish a competitive Clean Ports grant program for the purchase or installation of zero emission port equipment or technology. Eligible applicants must include port authorities, state governments, local governments, tribal governments, air pollution control agencies, and private entities that own, operate, or use port. Zero emission technology includes all-electric vehicles and fuel cell electric vehicles (FCEVs). Additional funding is available for projects located in nonattainment communities. For more information, see the EPA Ports Initiative website.

(Reference Public Law 117-169)

Port Infrastructure Development Program

The U.S. Department of Transportation (DOT) will establish the Port Infrastructure Development Program (PIDP) to fund projects that improve port resiliency to address sea-level rise, flooding, extreme weather events, earthquakes, and tsunami inundation, as well as projects that reduce or eliminate port-related criteria pollutant or greenhouse gas emissions. Funded projects may include:

  • Port electrification or electrification master planning;
  • Development of port or terminal micro-grids;
  • Worker training to support electrification technology; and,
  • Electric vehicle charging or hydrogen fueling infrastructure.

Funding is authorized through fiscal year 2026. Applications for the first funding round are due May 16, 2022. For more information, see the Notice of Funding Opportunity announcement and the PIDP website.

(Reference Public Law 117-58)

Pre-Owned Electric Vehicle (EV) and Fuel Cell Electric Vehicle (FCEV) Tax Credit

Beginning January 1, 2023, the Clean Vehicle Credit provides a tax credit of up to $4,000 for the purchase of a pre-owned EV or FCEV. Eligible vehicles must be of a model year at least two years prior to the year of purchase and may not have a purchase price above $25,000. Individuals with a gross annual income below the following thresholds are eligible for the tax credit:

  • $150,000 for joint filers

  • $112,500 for head-of-household filers

  • $75,000 for single filers

Only one tax credit may be claimed per vehicle. Individuals may not claim more than one pre-owned vehicle tax credit in a three-year period.

(Reference Public Law 117-169)

Point of Contact
U.S. Internal Revenue Service
Phone: (800) 829-1040
http://www.irs.gov/

Public School Energy Program

The U.S. Department of Energy (DOE) must establish for local educational agencies competitive grant program for energy improvements upgrades, including installation of alternative fuel vehicle (AFV) fueling or charging infrastructure on school grounds and purchase or lease AFVs. AFV fueling or charging infrastructure can be exclusively for the school fleet or students, or open to the public. Eligible AFVs include school buses and school fleet vehicles. (Reference Public Law 117-58)

Public Transportation Research, Demonstration, and Deployment Funding

The U.S. Department of Transportation’s Federal Transit Administration administers the Public Transportation Innovation Program. Financial assistance is available to local, state, and federal government entities; public transportation providers; private and non-profit organizations; and higher education institutions for research, demonstration, and deployment projects involving low or zero emission public transportation vehicles. Eligible vehicles must be designated for public transportation use and significantly reduce energy consumption or harmful emissions compared to a comparable standard or low emission vehicle. For more information, see the FAST Act Section 5312 fact sheet and the MAP-21 website. (Reference Public Law 117-58, Public Law 113-159, Public Law 114-94, 49 U.S. Code 5312, and 49 U.S. Code 5339)

Point of Contact
Federal Transit Administration, Office of Program Management
U.S. Department of Transportation
Phone: (202) 366-2053
http://www.fta.dot.gov

Regional Clean Hydrogen Hubs

The U.S. Department of Energy (DOE) administers the Regional Clean Hydrogen Hubs (H2Hubs) program. H2Hubs will fund the development of at least four regional networks of hydrogen producers, potential hydrogen consumers, and connective infrastructure located in close proximity. At least one H2Hub must demonstrate the end-use of hydrogen in the transportation sector. Clean hydrogen is defined as hydrogen produced with a carbon intensity equal to or less than 2 kilograms of carbon dioxide-equivalent produced at the site of production per kilogram of hydrogen produced. DOE will evaluate lifecycle emissions for each project application and give preference to applications that reduce greenhouse gas emissions across the full project lifecycle. For more information, including funding availability, see the DOE Notice of Intent.

(Reference Public Law 117-58)

State Energy Program (SEP) Funding

The SEP provides grants to states to assist in designing, developing, and implementing renewable energy and energy efficiency programs, including programs to help reduce carbon emissions in the transportation sector by 2050 and accelerate the use of alternative transportation fuels for, and the electrification of, state government vehicles, fleet vehicles, taxis and ridesharing services, mass transit, school buses, ferries, and privately owned passenger and medium- and heavy-duty vehicles. Each state's energy office receives SEP funding and manages all SEP-funded projects. States may also receive project funding from technology programs in the U.S. Department of Energy's Office of Energy Efficiency and Renewable Energy (EERE) for SEP Special Projects. EERE distributes the funding through an annual competitive solicitation to state energy offices. SEP is authorized through fiscal year 2026. For more information, see the SEP website. (Reference Public Law 117-58 and 42 U.S. Code 6322 through 6325)

Point of Contact
U.S. Department of Energy
Phone: (202) 586-5000
http://www.energy.gov

Zero Emission Vehicle Infrastructure and Advanced Vehicle Grants

The U.S. Department of Transportation (DOT) Rebuilding American Infrastructure with Sustainability and Equity (RAISE) grant program provides federal financial assistance to eligible surface transportation infrastructure projects. Eligible projects include, but are not limited to, supporting connected, electric, and automated vehicles, a modal shift in freight or passenger movement to reduce greenhouse gas emissions, and the installation of zero-emission vehicle infrastructure. Eligible applicants for RAISE grants are state, local, tribal, and U.S. territories’ governments, including transit agencies, port authorities, metropolitan planning organizations, and other political subdivisions of state or local governments. Additional terms and conditions apply. For more information, see the DOT RAISE Grants website.

Laws and Regulations

Alternative Fuel Definition

The following fuels are defined as alternative fuels by the Energy Policy Act (EPAct) of 1992: pure methanol, ethanol, and other alcohols; blends of 85% or more of alcohol with gasoline; natural gas and liquid fuels domestically produced from natural gas; propane; coal-derived liquid fuels; hydrogen; electricity; pure biodiesel (B100); fuels, other than alcohol, derived from biological materials; and P-Series fuels. In addition, the U.S. Department of Energy may designate other fuels as alternative fuels, provided that the fuel is substantially non-petroleum, yields substantial energy security benefits, and offers substantial environmental benefits. For more information, see the EPAct website. (Reference 42 U.S. Code 13211)

Point of Contact
U.S. Department of Energy
Phone: (202) 586-5000
http://www.energy.gov

Alternative Fuel Definition - Internal Revenue Code

The Internal Revenue Service (IRS) defines alternative fuels as propane, natural gas, liquefied hydrogen, liquid fuel derived from coal through the Fischer-Tropsch process, liquid hydrocarbons derived from biomass, and P-Series fuels. Biodiesel, ethanol, and renewable diesel are not considered alternative fuels by the IRS. While the term "hydrocarbons" includes liquids that contain oxygen, hydrogen, and carbon and as such "liquid hydrocarbons derived from biomass" includes ethanol, biodiesel, and renewable diesel, the IRS specifically excluded these fuels from the definition. (Reference 26 U.S. Code 6426)

Point of Contact
U.S. Internal Revenue Service
Phone: (800) 829-1040
http://www.irs.gov/

Alternative Fuel Labeling Requirements

Retailers offering alternative fuel for sale must ensure dispensers are labeled with information to help consumers make informed decisions about fueling a vehicle, including the name of the fuel and the minimum percentage of the main component of the fuel. Labels may also list the percentage of other fuel components. This requirement applies to, but is not limited to, the following fuel types: methanol, denatured ethanol, and/or other alcohols; mixtures containing 85% or more by volume of methanol and/or other alcohols; mixtures containing more than 10% but less than 83% by volume of ethanol; natural gas; propane; hydrogen; coal derived liquid biofuel; and electricity.

Fuel dispensers distributing biodiesel blends containing more than 5% biodiesel by volume must include the percentage of biodiesel included. For ethanol blends containing no greater than 50% ethanol by volume, retailers must post the exact percentage of ethanol concentration, rounded to the nearest multiple of 10. For ethanol blends containing more than 50% but no greater than 83% ethanol by volume, retailers must (1) post the exact percentage of ethanol concentration, (2) post the percentage rounded to the nearest multiple of 10, or (3) post notice that the fuel contains 51% to 83% ethanol.

Electric vehicle supply equipment (EVSE) manufacturers must determine and disclose (via a delivery ticket or permanent label or marking) kilowatt capacity, voltage, whether the voltage is alternating current or direct current, amperage, and whether the system is conductive or inductive.

(Reference 81 Federal Register 2054 and 16 CFR 306 and 309)

Point of Contact
Federal Trade Commission
Phone: (202) 326-2222
http://www.ftc.gov/

Emerging Alternative Fuel Vehicle (AFV) Study

The U.S. Department of Transportation must conduct an AFV study, focusing specifically on hydrogen, natural gas, or propane, that identifies:

  • Five-year AFV ownership forecasts;
  • AFV infrastructure siting locations, including a map, to support the forecasts;
  • Includes an evaluation and map that identifies concentrations of emerging AFVs to meet fueling infrastructure needs;
  • Barriers to deploying AFV infrastructure at the identified locations; and,
  • Additional maps and tools to allow states to compare and evaluate different AFV adoption and use scenarios.

The report must be made publicly available and submitted to Congress by November 15, 2022.

(Reference Public Law 117-58)

High Occupancy Vehicle (HOV) Lane Exemption

States are allowed to exempt certified alternative fuel vehicles (AFVs) and electric vehicles (EVs) from HOV lane requirements within the state. Eligible AFVs are defined as vehicles operating solely on methanol, denatured ethanol, or other alcohols; a mixture containing at least 85% methanol, denatured ethanol, or other alcohols; natural gas, propane, hydrogen, or coal derived liquid fuels; or fuels derived from biological materials. EVs are defined as vehicles that are recharged from an external source of electricity and have a battery capacity of at least 4 kilowatt-hours. States are also allowed to establish programs allowing low-emission and energy-efficient vehicles to pay a toll to access HOV lanes.

Vehicles must be certified by the U.S. Environmental Protection Agency (EPA) and appropriately labeled for use in HOV lanes. The U.S. Department of Transportation (DOT) is responsible for planning and implementing HOV programs, including the low-emission and energy-efficient vehicle criteria EPA established. States that choose to adopt these requirements will be responsible for enforcement and vehicle labeling. The HOV exemption for AFVs and EVs expires September 30, 2025 and low-emission and energy-efficient vehicle toll-access to HOV lanes expires September 30, 2019.

(Reference Public Law 114-94 and 23 U.S. Code 166)

Joint Office of Energy and Transportation

The U.S. Department of Transportation (DOT) and the U.S. Department of Energy (DOE) will establish a Joint Office of Energy and Transportation (Joint Office) to study, plan, coordinate, and implement joint issues, including:

  • Technical assistance related to the deployment, operation, and maintenance of electric vehicle supply equipment (EVSE) and hydrogen fueling infrastructure, vehicle-to-grid integration, and related programs and policies;
  • Data sharing of installation, maintenance, and utilization to continue to inform the network build out of EVSE and hydrogen fueling infrastructure;
  • Performance of a national and regionalized study of EVSE and hydrogen fueling infrastructure needs and deployment factors, to support grants for community resilience and electric vehicle (EV) integration;
  • Development and deployment of training and certification programs;
  • Electric infrastructure and utility accommodation planning in transportation rights-of ways; and,
  • Research, strategies, and actions to reduce transportation-related emissions and mitigate the effects of climate change.

The Joint Office will create a public database that includes EVSE data maintained on the DOE Alternative Fuels Data Center's Alternative Fueling Station Locator and potential EVSE locations identified by eligible entities. For more information, see the Joint Office website.

(Reference Public Law 117-58)

Procurement Preference for Electric and Hybrid Electric Vehicles

The U.S. Department of Defense (DOD) must exhibit a preference for the lease or procurement of motor vehicles with electric or hybrid electric propulsion systems, including plug-in hybrid systems, if the vehicles are commercially available at a cost reasonably comparable to motor vehicles with internal combustion engines. Tactical vehicles designed for use in combat are excluded from the requirement. (Reference 10 U.S. Code 2922g)

Point of Contact
U.S. Department of Defense
Phone: (703) 571-3343
http://www.defense.gov/

Truck Leasing Task Force

The Secretary of Transportation, in consultation with the Secretary of Labor, must establish the Truck Leasing Task Force (TLTF) to examine common truck leasing arrangements, including specific agreements relating to the Ports of Los Angeles and Long Beach Clean Trucks Program and similar programs to decrease port operations emissions. TLTF will terminate 30 days after submitting findings and recommendations to Congress. For more information, see the TLTF website. (Reference Public Law 117-58)

Vehicle Acquisition and Fuel Use Requirements for Federal Fleets

Under the Energy Policy Act (EPAct) of 1992, 75% of new light-duty vehicles acquired by covered federal fleets must be alternative fuel vehicles (AFVs). As amended in January 2008, Section 301 of EPAct 1992 expands the definition of AFVs to include hybrid electric vehicles, fuel cell vehicles, and advanced lean burn vehicles. Fleets that use fuel blends containing at least 20% biodiesel (B20) may earn credits toward their annual requirements. Federal fleets are also required to use alternative fuels in dual-fuel vehicles unless the U.S. Department of Energy (DOE) approves waivers for agency vehicles; grounds for a waiver include lack of alternative fuel availability and unreasonable cost (per EPAct 2005, section 701).

Additional requirements for federal fleets were included in the Energy Independence and Security Act of 2007, such as fleet management plans and petroleum reduction from 2005 levels (Section 142), low greenhouse gas (GHG) emitting vehicle acquisition requirements (Section 141), and renewable fuel infrastructure installation requirements (Section 246). For more information, see the Federal Fleet Management website.

To track progress toward meeting AFV acquisition and fuel use requirements, federal fleets must report on their percent alternative fuel increase compared to the fiscal year 2005 baseline, alternative fuel use as a percentage of total fuel consumption, AFV acquisitions as a percentage of vehicle acquisitions, and fleet-wide miles per gasoline gallon equivalent of petroleum fuels.

Executive Order 13834, issued in May 2018, requires the Secretary of Energy (Secretary), in coordination with the Secretary of Defense, the Administrator of General Services, and the heads of other agencies as appropriate, to review the existing federal vehicle fleet requirements. In April 2019, the Secretary provided a report to the Chairman of the Council on Environmental Quality and the Director of the Office of Management and Budget detailing opportunities to optimize federal fleet performance, reduce associated costs, and streamline reporting and compliance requirements. Specifically, the report recommends that federal agencies identify and implement strategies to:

  • Right-size the fleet
  • Reduce vehicle miles traveled
  • Implement more fuel efficient vehicles
  • Align the implementation of AFVs and associated fueling infrastructure
Executive Order 14008, issued in January 2021, requires the Chair of the Council on Environmental Quality, the Administrator of General Services, and the Director of the Office and Management and Budget, in coordination with the Secretary of Commerce, the Secretary of Labor, the Secretary, and the heads of other relevant agencies, to assist the National Climate Advisor in developing a comprehensive plan to facilitate clean and zero-emission vehicles for federal, state, local, and tribal government fleets, including vehicles of the U.S. Postal Service. The plan must be submitted to the National Climate Task Force by April 27, 2021.

(Reference 42 U.S. Code 13212 and Executive Order 13834 and Executive Order 14008)

Point of Contact
Federal Energy Management Program
U.S. Department of Energy
https://www.energy.gov/eere/femp/federal-energy-management-program-contacts

Vehicle Acquisition and Fuel Use Requirements for Private and Local Government Fleets

Under the Energy Policy Act (EPAct) of 1992, the U.S. Department of Energy (DOE) was directed to determine whether private and local government fleets should be mandated to acquire alternative fuel vehicles (AFVs). In January 2004, DOE published a final rule announcing its decision not to implement an AFV acquisition mandate for private and local government fleets. In response to a March 2006 ruling by a U.S. District Court, DOE issued a subsequent final rulemaking on the new Replacement Fuel Goal in March 2007, which extended the EPAct 1992 goal to 2030. The goal is to achieve a domestic production capacity for replacement fuels sufficient to replace 30% of the U.S. motor fuel consumption. In March 2008, DOE issued its determination not to implement a fleet compliance mandate for private and local government fleets, concluding that such a mandate is not necessary to achieve the Replacement Fuel Goal. For more information on the Private and Local Government Fleet Rule compliance, visit the EPAct Private and Local Government Fleet Determination website. (Reference 42 U.S. Code 13257)

Vehicle Acquisition and Fuel Use Requirements for State and Alternative Fuel Provider Fleets

Under the Energy Policy Act (EPAct) of 1992, as amended, certain state government and alternative fuel provider fleets are required to acquire alternative fuel vehicles (AFVs) as a portion of their annual light-duty vehicle acquisitions. Compliance is required by fleets that operate, lease, or control 50 or more light-duty vehicles within the United States. Of those 50 vehicles, at least 20 must be used primarily within a single Metropolitan Statistical Area/Consolidated Metropolitan Statistical Area, and those same 20 vehicles must also be capable of being centrally fueled for the fleet to be subject to the regulatory requirements.

Under Standard Compliance, the AFVs that covered fleets acquire help them achieve compliance, with each AFV acquired earning the fleet one AFV-acquisition credit. Covered fleets may earn additional credits for AFVs earned in excess of their requirements, and these credits may be banked for future use toward compliance or traded with other fleets. Additionally, fleets that use fuel blends containing at least 20% biodiesel (B20) in medium- and heavy-duty vehicles may earn credits toward their annual AFV-acquisition requirements. A fleet may also earn credits that may be used toward compliance or banked once the fleet achieves compliance for investments in alternative fuel infrastructure, mobile non-road equipment, and emerging technologies associated with certain electric drive vehicle technologies.

Fleets may also opt into Alternative Compliance, which allows fleets the option to choose a petroleum reduction path in lieu of acquiring AFVs under Standard Compliance. Interested fleets must obtain from DOE a waiver from Standard Compliance by submitting a plan that demonstrates a path by which they will achieve a certain level of petroleum reduction specific to their fleet composition.

For more information, visit the EPAct State and Alternative Fuel Provider Fleets website.

(Reference 42 U.S. Code 13251 and 13263a, and 10 CFR 490)

Point of Contact
EPAct Transportation Regulatory Activities
U.S. Department of Energy
regulatory.info@nrel.gov
https://epact.energy.gov/contact-us

Vehicle Incremental Cost Allocation

The U.S. General Services Administration (GSA) must allocate the incremental cost of purchasing alternative fuel vehicles (AFVs) across the entire fleet of vehicles distributed by GSA. This mandate also applies to other federal agencies that procure vehicles for federal fleets. For more information, see the GSA's AFV website. (Reference 42 U.S. Code 13212 (c))

Point of Contact
Fleet Alternative Fuel Vehicle Team
U.S. General Services Administration
Phone: (703) 605-5630
gsafleetafvteam@gsa.gov
http://www.gsa.gov

Programs

Clean Cities Coalition Network

The mission of Clean Cities Coalition Network is to foster the economic, environmental, and energy security of the United States by working locally to advance affordable, domestic transportation fuels and technologies. Nearly 100 volunteer coalitions carry out this mission by developing public/private partnerships to promote alternative and renewable fuels, idle-reduction measures, fuel economy, improvements, and emerging transportation technologies. The Clean Cities Coalition Network provides information about financial opportunities, coordinates technical assistance projects, updates and maintains databases and websites, and publishes technical and informational materials. For more information, see the Clean Cities Coalition Network website.

Point of Contact
U.S. Department of Energy
Phone: (202) 586-5000
http://www.energy.gov

Clean Construction and Agriculture

Clean Construction is a voluntary program that promotes the reduction of diesel exhaust emissions from construction equipment and vehicles by encouraging proper operations and maintenance, use of emissions-reducing technologies, and use of cleaner fuels.

Clean Agriculture is a voluntary program that promotes the reduction of diesel exhaust emissions from agricultural equipment and vehicles by encouraging proper operations and maintenance by farmers, ranchers, and agribusinesses, use of emissions-reducing technologies, and use of cleaner fuels.

Clean Construction and Clean Agriculture are part of the U.S. Environmental Protection Agency's Diesel Emissions Reduction Act (DERA) Program, which offers funding for clean diesel construction and agricultural equipment projects.

For more information, see the Reducing Diesel Emissions from Construction and Agriculture website.

Point of Contact
DERA Helpline
Diesel Emissions Reduction Act
U.S. Environmental Protection Agency
Phone: (877) 623-2322
dera@epa.gov
https://www.epa.gov/dera

Ports Initiative

The U.S. Environmental Protection Agency's (EPA) Ports Initiative is an incentive-based program designed to reduce emissions by encouraging port authorities and terminal operators to retrofit and replace older diesel engines with new technologies and use cleaner fuels. EPA's Ports Initiative offers funding to port authorities and public entities to help them overcome barriers that impede the adoption of cleaner diesel technologies and strategies. For more information, see the Ports Initiative website.

Point of Contact
Jennifer Keller
National Clean Diesel Campaign
U.S. Environmental Protection Agency
Phone: (202) 343-9541
keller.jennifer@epa.gov
http://www.epa.gov/cleandiesel/

Voluntary Airport Low Emission (VALE) Program

The goal of the VALE Program is to reduce ground level emissions at commercial service airports located in designated ozone and carbon monoxide air quality nonattainment and maintenance areas. The VALE Program provides funding through the Airport Improvement Program and the Passenger Facility Charges program for the purchase of low emission vehicles, development of fueling and recharging stations, implementing gate electrification, and other airport air quality improvements. For more information, see the VALE Program website. (Reference 49 U.S. Code 47139)

More Laws and Incentives

To find laws and incentives for other alternative fuels and advanced vehicles, search all laws and incentives.