Skip to Content
U.S. Department of Energy Energy Efficiency and Renewable Energy

Natural Gas Laws and Incentives in Vermont

The list below contains summaries of all Vermont laws and incentives related to natural gas.

State Incentives

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.

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.

Laws and Regulations

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)

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)

More Laws and Incentives

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