Natural Gas Laws and Incentives in Oklahoma
The list below contains summaries of all Oklahoma laws and incentives related to natural gas.
Laws and Regulations
Access to State Alternative Fueling Stations
The Oklahoma Office of Management and Enterprise Services (OMES) Fleet Management Division may construct, install, acquire, operate, and provide alternative fueling infrastructure for use by state agencies and local government and for use by the public in areas of the state where public access to alternative fuel infrastructure is not readily available. OMES must discontinue public access to their fueling stations if a privately owned alternative fueling station opens within a five-mile radius. Alternative fuels include natural gas, propane, ethanol, methanol, biodiesel, electricity, and hydrogen. (Reference Oklahoma Statutes 74-78 and 74-130.2)
Alternative Fuel Technician Training
The Alternative Fuels Technician Certification Act (Act) regulates the training, testing, and certification of technicians and trainees who install, modify, repair, or renovate equipment used in alternative fueling infrastructure and in the conversion of any engine to operate on an alternative fuel. Alternative fuels include propane, natural gas, methanol, ethanol, electricity, coal-derived liquid fuels, hydrogen, biodiesel, and fuels derived from biological materials. This includes original equipment manufacturer engines dedicated to operate on an alternative fuel. Plug-in electric vehicles (PEVs), PEV charging infrastructure, and PEV technicians must also comply with the rules and regulations of this Act. (Reference Oklahoma Statutes 40-142.3)
Alternative Fuel Vehicle (AFV) Acquisition Requirements
All school and government fleets may convert their vehicles to operate on alternative fuels, and all school districts should consider purchasing only vehicles able to operate on alternative fuels. Alternative fuels include natural gas and liquid fuels produced from natural gas, propane, ethanol, methanol, electricity, biodiesel, coal-derived liquid fuels, hydrogen, and fuels derived from biological materials. School and government vehicles capable of operating on an alternative fuel must use the fuel whenever a fueling station is located within a five-mile radius of the respective school district or government department and the price of the alternative fuel is cost competitive with the displaced conventional fuel. If school and government vehicles must be fueled outside the five-mile radius and no fueling station is reasonably available, the school and government vehicles are exempt from this requirement. (Reference Oklahoma Statutes 74-130.3)
Alternative Fuel Vehicle (AFV) Tax and Fee
Compressed natural gas (CNG) used in motor vehicles is subject to a state motor fuel tax of $0.05 per gasoline gallon equivalent (GGE) until January 1, 2020. Beginning January 1, 2020, the tax rate increases to match the rate imposed on diesel fuel. Liquefied natural gas (LNG) is also subject to a state motor fuel tax rate of $0.05 per diesel gallon equivalent (DGE) until January 1, 2020, after which the tax rate increases to match the rate imposed on diesel fuel.In lieu of the motor fuel tax, some AFV owners are subject to a motor vehicle fee. An annual flat fee applies to passenger automobiles, pickup trucks, vans and heavy-duty vehicles using propane, natural gas, methanol, or blends of 85% methanol and 15% gasoline (M85). Propane and natural gas vehicles with a payload capacity of less than 2,000 pounds (lbs.) are taxed at a rate of $50 per vehicle per year. Methanol and M85 vehicles with a payload capacity of less than 2,000 lbs. are taxed at a rate of $100 per vehicle per year. Propane, methanol, and M85 vehicles with a payload capacity greater than 2,000 lbs. are taxed at a rate of $150 per vehicle per year. If the owner acquires the vehicle or converts it to run on the alternative fuel after July 1 of the tax year, the flat fee is half of the above mentioned amount. AFVs must display a decal that the Oklahoma Tax Commission issues on an annual basis.(Reference Oklahoma Statutes 68-500.4 and 68-723)
Alternative Fuels Technician Certificates
The Department of Labor (DOL) will issue a certificate to any person who has successfully passed the appropriate alternative fuels equipment, alternative fuels compression, or electric vehicle technician examination as provided in the Alternative Fuels Technician Certification Act. A certification fee applies. For companies, partnerships, or corporations involved in the business of installing, servicing, repairing, modifying, or renovating equipment used in converting or modifying engines or fueling equipment to be used with alternative fuels, DOL will issue a separate certificate.DOL can issue an alternative fuels trainee certificate to any person who submits a trainee application within 15 business days of being hired by a licensed alternative fuels conversion or fueling station installation company.(Reference Oklahoma Statutes 40-142.8)
Committee of Alternative Fuels Technician Examiners
The Committee of Alternative Fuels Technician Examiners (Committee) was established to assist the Commissioner of Labor on matters relating to the formulation of rules and standards to comply with the Alternative Fuels Technician Certification Act. The Committee consists of eight members, including experts in the natural gas, propane, and electric vehicle industries. (Reference Oklahoma Statutes 40-142.6)
Compressed Natural Gas (CNG) Fueling Infrastructure Development
The Oklahoma Legislature intends to increase the amount of CNG fueling infrastructure in the state, with the overall goal of having one public fueling station every 50 miles by 2025. The Oklahoma Office of Management and Enterprise Services Fleet Management Division may partner with private entities to build CNG fueling infrastructure. (Reference Oklahoma Statutes 74-78f)
Compressed Natural Gas (CNG) Fueling Infrastructure Inspection
The Oklahoma Department of Labor may access and inspect any equipment, practices, or methods used in association with public CNG fueling infrastructure. (Reference Oklahoma Statutes 40-142.2)
Compressed Natural Gas (CNG) Vehicle Loan Program Development
The Oklahoma Cooperative Circuit Engineering Districts Board must develop and adopt rules and processes for a no-interest loan program to allow qualified county governments to purchase or convert CNG vehicles. Counties that borrow funds must sell to a nongovernmental entity or properly dispose of a comparable number of conventional vehicles. Loan terms will be up to five years. (Reference Oklahoma Statutes 69-687.3C)
Natural Gas Measurement
The Oklahoma Department of Labor (DOL) must standardize compressed natural gas (CNG) and liquefied natural gas (LNG) measurements for retail motor vehicle fuel, unless the National Conference on Weights and Measures has established equivalent measures. Until the DOL standardizes measurements, a gasoline gallon equivalent is equal to 5.66 pounds (lbs.) of CNG and a diesel gallon equivalent is equal to 6.06 lbs. of LNG. (Reference Oklahoma Statutes 83-119)
Alternative Fuel School Bus and Electric Vehicle Supply Equipment (EVSE) Rebate Program
The Oklahoma Department of Environmental Quality (DEQ) is accepting applications for projects that repower or replace an actively used, engine model year 2009 or older, diesel school bus with an alternative fuel. Eligible alternative fuels and technologies include all-electric, electric hybrid, propane, and natural gas. Government-owned vehicles may be reimbursed up to 50% of the project cost and non-government owned vehicles may be reimbursed from 25% to 50% of the project cost, depending on the project. Charging infrastructure for electric buses is eligible for funding, but is subject to a per-charger maximum and the project cap. The program is funded by Oklahoma's portion of the Volkswagen (VW) Environmental Mitigation Trust. For more information, including per-vehicle caps on project reimbursements and application deadlines, see the DEQ VW Settlement website.
Alternative Fuel Vehicle (AFV) Tax Credit
For tax years beginning before December 31, 2027, a one-time income tax credit is available for up to $50,000 towards the cost of purchasing a new original equipment manufacturer AFV or converting a vehicle to operate on an alternative fuel. Tax credit amounts vary depending in the gross vehicle weight rating (GVWR) of the vehicle:
|6,000 pounds (lbs.) or below||$5,500|
|6,001 lbs. to 10,000 lbs.||$9,000|
|10,001 lbs. to 26,500 lbs.||$26,000|
|Greater than 26,501 lbs.||$50,000|
The state also provides a tax credit in the amount of 10% of the total vehicle cost, up to $1,500, if the incremental cost of a new AFV cannot be determined or when an AFV is resold, as long as a tax credit has not been previously taken on the vehicle. Equipment used for conversions must be new; must not have been previously used to modify or retrofit any vehicle; must meet applicable federal and state safety standards; and must be installed by a state certified alternative fuels equipment technician. The alternative fuels eligible for the credit are natural gas and propane. Tax credits may be carried forward for up to five years. (Reference House Bill 2095, 2019, and Oklahoma Statutes 68-2357.22)
Alternative Fueling Infrastructure Tax Credit
For tax years beginning before December 31, 2027, a tax credit is available for up to 45% of the cost of installing commercial alternative fueling infrastructure. Eligible alternative fuels include natural gas, propane, and electricity. The infrastructure must be new and must not have been previously installed or used to fuel alternative fuel vehicles. A tax credit is also available for up to 50% of the cost of installing a residential compressed natural gas fueling system, up to $2,500. The tax credit may be carried forward for up to five years. (Reference House Bill 2095, 2019, and Oklahoma Statutes 68-2357.22)
Natural Gas Vehicle and Idle Reduction Weight Exemption
A vehicle powered in whole or part by compressed or liquefied natural gas may exceed the state's gross and axle weight limits by up to 2,000 pounds, equal to the difference between the weight of the vehicle with the natural gas tank and fueling system and the weight of a comparable diesel tank and fueling system. The exemption is allowed on all state roads and interstate highways, as defined in Title 23 of the Code of Federal Regulations section 127(s).Any vehicle equipped with idle reduction technology may exceed the state's gross vehicle weight limits by up to 400 pounds to compensate for the additional weight of the idle reduction technology. The additional weight may not exceed the actual certified weight of the idle reduction unit. Upon request, vehicle operators must provide proof or certification of the weight of the idle reduction technology and proof that the idle reduction technology is fully functional.(Reference Oklahoma Statutes 47-14-109 and 47-14-109.3)
Alternative Fuel Vehicle (AFV) and Infrastructure Grants for Public Fleets
Under the Creating Long-term Energy Alternatives Now by Advancing Improvements Regionally (CLEAN AIR) Grants program, the Association of Central Oklahoma Governments (ACOG) issues requests for proposals (RFPs) for alternative fuel and advanced technology vehicle projects in the Oklahoma City Area Regional Transportation Study (OCARTS) area. Projects must provide a reduction in vehicle equipment emissions and cannot increase the number of vehicles in applicant fleets. Eligible projects may also include AFV fueling station or charging infrastructure. Eligible applicants include OCARTS-member governments, certain public trusts and public authorities providing essential services to OCARTS-member governments, member entity public transit fleets, and to public school fleets whose district boundaries are contained partially or wholly within the OCARTS area. There are currently no available RFPs (verified August 2018). For more information, including open solicitations, see the ACOG CLEAN AIR Grants for Public Fleets website.
Natural Gas Vehicle (NGV) and Infrastructure Rebate - Oklahoma Natural Gas
Oklahoma Natural Gas (ONG) offers rebates for NGVs purchased or converted after June 20, 2016, in the amount of $2,000 for a dedicated of bi-fuel NGV. ONG also offers $3,000 toward the cost of a compressed natural gas home fueling station. Rebates are available on a first come, first served basis and are limited to three rebates per applicant, per calendar year. For more information, see the ONG CNG Rebate Program website.
Point of Contact
Sales Representative II
Oklahoma Natural Gas
Natural Gas Vehicle Loans - Communication Federal Credit Union (CFCU)
CFCU offers loans to individuals and businesses that purchase new or converted compressed natural gas (CNG) vehicles. Conversion systems must be certified by the U.S. Environmental Protection Agency and installed by an insured and state-licensed facility. New vehicle loans are available at amounts up to the manufacturer's suggested retail price plus the cost of the conversion. Pre-owned or CFCU member-owned vehicles with a CNG fuel system or conversion installation are eligible for loans at up to 115% of the National Automobile Dealers Association suggested retail value. All financing is at CFCU standard auto loan rates. CFCU also offers loans for the cost of home fueling appliances. For more information, see the CFCU CNG Loans website.
More Laws and Incentives
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