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

Plug-In Electric Vehicle (PEV) Incentive

The Vermont Agency of Transportation provides financial incentives to low- and moderate-income residents for the purchase or lease of a new PEV on a first-come, first-served basis. Incentives are available according to the following schedule:

Vehicle TypeIncentive for $96,122 Household Income or LessIncentive for Lower Income Households
Plug-in Hybrid Electric Vehicle$1,500$4,000
All-Electric Vehicle$2,500$5,000

For more information, including application and eligibility requirements, visit the Drive Electric Vermont website.

(Reference House Bill 529, 2019)

Fuel-Efficient Vehicle and Emission Reduction Incentives

The Vermont Agency of Transportation (VTrans) will administer the High Fuel Efficiency Vehicle Incentive and Emissions Repair Program, which provides incentives to replace eligible vehicles with a used vehicle that has a U.S. Environmental Protection Agency (EPA) combined city/highway fuel economy of at least 40 miles per gallon (mpg) and vouchers of up to $2,500 for the repair of vehicles that failed the on-board diagnostic (OBD) systems inspection. Eligible vehicles for replacement include those that have failed the OBD systems inspection or those that are more than 15 years old and have an EPA combined city/highway fuel economy of less than 25 mpg. Eligible vehicles for a repair voucher are those that have failed the OBD systems inspection, require repairs that are not under warranty, and will be able to pass the inspection once the repairs are made.

The Vermont Department of Labor, in consultation with VTrans and other Vermont agencies, must evaluate whether to establish the Emissions Repair Program and submit a report to the legislature regarding how to fund the program on or before February 1, 2020.

(Reference House Bill 529, 2019)

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, biodiesel, natural gas, propane, electricity, and hydrogen. Cost share requirements vary by project. For more information, including application details, see the DEC Vermont Diesel Emissions Reduction Grants website.

Electric Vehicle Supply Equipment (EVSE) Grants

The Vermont Department of Housing and Community Development (DHCD) provides funding to governments, businesses, non-profit organizations, homeowner associations, electric utilities, and EVSE providers for the cost and installation of eligible EVSE. Funding is available for up to 60% of project costs, with a maximum of $150,000 per project site. This grant program is funded by Vermont's portion of the Volkswagen Environmental Mitigation Trust. The program is not currently accepting applications (verified June 2019). For more information, see the DHCD EVSE Grant Program website.

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 charging and natural gas fueling stations. 1% fixed loans are available to municipalities and 3% fixed loans are available to private sector borrowers. Other terms and conditions may apply. See the Vermont Economic Development Authority's SIB page for more information, including how to apply.

Utility/Private Incentives

Plug-In Electric Vehicle (PEV) Loan - Burlington Electric Department (BED)

BED provides low- or no-interest loans for the purchase of a new PEV. Eligible customers can also apply a BED PEV incentive of up to $1,800 toward the purchase of the PEV. For more information, see the BED Electric Vehicles website.

Plug-In Electric Vehicle Credit - Vermont Electric Co-op (VEC)

VEC offers a $250 bill credit to members who purchase a new or used plug-in hybrid electric vehicle (PHEV) and a $500 bill credit to members who purchase a new or used all-electric vehicle (EV). Members who lease a PHEV are eligible for an annual bill credit of $50 for each year of the lease. For members who lease an EV, an annual bill credit of $100 is available for each year of the lease. Members must commit to avoid charging from 5-9PM Monday through Friday to be eligible.For more information, including how to apply, see the VEC Energy Transformation Program website.

Plug-In Electric Vehicle (PEV) Charging Rate Reduction and EVSE Rebate - BED

Burlington Electric Department (BED) offers a per kilowatt-hour discount for residential customers to charge PEVs during off-peak times. To qualify, customers must install a WiFi enabled electric vehicle supply equipment (EVSE).

BED also offers a rebate of $400 for the purchase and installation of a qualifying Wifi enabled EVSE for customers that have enrolled in BED’s Residential EV Rate. Eligible applicants must have purchased EVSE within 60 days of the acquisition of the EV.

For more information, see the BED EV Rate website.

Electric Vehicle Supply Equipment (EVSE) Credit - Vermont Electric Co-op (VEC)

VEC offers a bill credit of $500 per connector, up to $2,000, to VEC member businesses and public entities that install Level 2 or DC fast EVSE between July 2, 2017 and December 31, 2019. To qualify, the EVSE must be available for public use and must commit to avoiding charging between peak hours of 5-9pm Monday through Thursday. Bill credits are available for up to 30 connectors total. For more information, including how to apply, see the VEC Energy Transformation Program website.

Electric Vehicle Supply Equipment (EVSE) Incentive - Green Mountain Power (GMP)

GMP residential customers are eligible for a free Level 2 EVSE when they purchase a new all-electric vehicle. For more information about these incentives, see GMP's In-Home Level 2 EV Charger website.

Plug-in Electric Vehicle (PEV) Rebate – Stowe Electric

Stowe Electric offers customers rebates for the purchase of PEVs. New plug-in hybrid electric vehicles (PHEVs) are eligible for a $450 rebate and new all-electric vehicles are eligible for a $850 rebate. Income-qualifying customers are eligible for an additional $250 rebate for either vehicle. For more information, including how to apply, see the Stowe Electric Rebate Programs website.

Plug-In Electric Vehicle (PEV) Rebate - Green Mountain Power (GMP)

GMP provides rebates of $1,500 for the purchase of new all-electric vehicles, $1,000 for the purchase of new plug-in hybrid electric vehicles, and $750 for the purchase of used PEVs. Customers with qualifying low and moderate household incomes are eligible for an additional $1,000 rebate. Vehicles must have a manufacturer's suggested retail price that is less than or equal to $60,000. For more information, see the GMP EV Rebate website.

Electric Drive Vehicle Rebate – Vermont Public Power Supply Authority (VPPSA)

VPPSA member customers are eligible for a rebate of up to $1,000 on the purchase of a plug-in electric vehicle, and up to $600 on the purchase of a plug-in hybrid electric vehicle. For more information visit the VPPSA Electric Vehicle Rebate website.

Laws and Regulations

Public Utility Definition

An entity that supplies electricity to the public exclusively to charge plug-in electric vehicles is not defined as a public utility and may charge for this electricity by the kilowatt-hour. (Reference House Bill 529, 2019, and Vermont Statutes Title 30, Chapter 5, Section 203)

Plug-In Electric Vehicle (PEV) Charging Fee Analysis

By December 15, 2019, the Vermont Public Utility Commission (Commission), in consultation with electric utilities, the Vermont Agency of Transportation, the Vermont Department of Public Service, and Efficiency Vermont, must submit a report to the legislature evaluating:

  • The steps necessary for electric utilities to implement a PEV charging fee;
  • A PEV charging tariff design for electric utilities with more than 17,000 customers;
  • Whether the Commission should require electric utilities to submit regular reports on PEV charging-related activities;
  • The amount of additional revenue electric utilities expect to be generated by PEVs over the next 10 years; and
  • How to address the use of net metering and net metering energy credits for PEV charging.
(Reference House Bill 529, 2019)

Electric Vehicle Supply Equipment (EVSE) Fee Authorization

Any Vermont agency or department that owns or controls EVSE may establish and set user fees. The agency or department may establish fees that are less than or equal to the cost of charging or the retail rate charged for the use of EVSE available to the public. Fees collected must be deposited into the same fund or account from which the EVSE expenses originated. This authorization expires on July 1, 2022. (Reference House Bill 529, 2019, and Vermont Statutes Title 32, Chapter 7, Section 604)

Electric Vehicle Supply Equipment (EVSE) Code Reporting

On or before December 1, 2019, the Vermont Agency of Agriculture, Food and Markets (Agency) must submit a report to the legislature that provides an update on the National Institute of Standards and Technology’s (NIST) progress toward adopting a code on EVSE and makes a recommendation for an annual licensing fee for EVSE available to the public. If NIST has not adopted a code on EVSE by December 1, 2020, the Agency must submit an additional report on or before that date that provides an update on NIST’s progress toward adopting a code. (Reference House Bill 529, 2019)

Fuel-Efficient Vehicle Incentive Analysis

On or before October 15, 2019, the Vermont Agency of Transportation must complete a study and submit a report to the legislature determining whether to implement a rebate program for individuals to purchase or lease fuel-efficient vehicles that is funded by fees collected from individuals that purchase or lease inefficient vehicles. The report must also assess how this incentive program could function with other Vermont incentive programs to reach the plug-in electric vehicle goal in the Vermont Comprehensive Energy Plan. (Reference House Bill 529, 2019)

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. (Reference Vermont Air Pollution Control Regulations 5-1101 through 5-1109)

Hybrid Electric Vehicle (HEV) and Plug-In Electric Vehicle (PEV) Acquisition Requirements

The Vermont Department of Buildings and General Services (Department) must, to the extent possible, purchase or lease HEVs or PEVs for state use. At least 50% of the vehicles purchased or leased annually must be HEVs or PEVs. Beginning July 1, 2021, at least 75% of the vehicles purchased or leased annually must be HEVs or PEVs. The Department must acquire the lowest-cost make and model that meets the State’s needs. (Reference House Bill 529, 2019, and Vermont Statutes Title 29, Chapter 49, Section 903)

Zero Emission Vehicle (ZEV) Deployment Support

Vermont joined California, Connecticut, 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 supply equipment (EVSE) 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 electric vehicle 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 Multi-State ZEV Task Force website.

Autonomous 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.

By January 1, 2021, the Vermont Agency of Transportation will publish an Automated Vehicle Testing 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 a technology that has the capability to operate the vehicle without the direct control of the driver.

(Reference Senate Bill 149, 2019, and Vermont Statutes Title 23, Chapter 41, Sections 4201-4203)

Support for Autonomous Vehicles (AVs)

The Vermont Agency of Transportation (VTrans) assembled a meeting of public and private stakeholders on November 8, 2017, to discuss raising awareness regarding the opportunities and challenges of AVs. Topics of discussion included:

  • AV registration and inspection;
  • AV education, training, and operator licensing;
  • Insurance and liability;
  • Enforcement of AV laws;
  • AV testing;
  • Emergency response;
  • AV infrastructure needs; and the
  • Social, economic, and environmental impacts of AVs
VTrans reported on the conclusions of this meeting in its report to the Vermont General Assembly, Preparing for Automated Vehicles in Vermont.

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)

Plug-In Electric Vehicle (PEV) Analysis

The Vermont Public Utility Commission (Commission) completed a report that evaluated PEVs and PEV charging in the state. The Commission was to provide public notice, opportunity for submission of written comments, and one or more workshops on PEVs before the evaluation is conducted. In its report, the Commission was required to include analysis and recommendations on the following topics regarding electric vehicle supply equipment (EVSE) owned by electric utilities:

  • Removal of barriers to EVSE installation, including strategies to reduce operating costs for EVSE users;
  • Strategies to manage the impact of PEV charging on the electric transmission and distribution system;
  • Strategies to facilitate the services provided by PEVs to the electric transmission and distribution system;
  • Benefits and costs to the electric system of PEV charging, electric utility planning for PEV charging, and rate design for PEV charging; and
  • The role of electric utilities with respect to the deployment and operation of EVSE.
For EVSE owned or operated by non-utility entities, the Commission was also to report on its analysis and recommendations for:

  • How and when these EVSE stations will obtain electricity;
  • Safety standards for EVSE;
  • The role of the Commission and other relevant state agencies in managing these EVSE;
  • Regulations, if any, on pricing structures for EVSE, including transparency to the consumer of any rates or prices; and
  • Billing and complaint procedures for EVSE.
The Commission also was to consider:

  • Options for PEV drivers to contribute toward the cost of maintaining the State's transportation infrastructure;
  • The accuracy of electric metering and submetering technology for PEV charging;
  • Strategies to encourage PEV adoption and achieve the State's Comprehensive Energy Plan and greenhouse gas reduction goals; and
  • Any other topics that the Commission believes are relevant to fair, cost-effective, and accessible PEV charging.
The Commission published a report with its findings on June 27, 2019.

Support for Plug-In Electric Vehicle (PEV) Adoption

The Vermont Climate Action Commission (VCAC) was established to evaluate actions that the state can take to reduce greenhouse gas emissions from all sectors of the economy, including transportation. VCAC published its Final Report on July 31st, 2018, which recommends that Vermont take the following actions to increase PEV adoption:

  • Reduce the purchase cost of PEVs;
  • Increase the availability of electric vehicle supply equipment;
  • Increase public awareness of PEVs and their benefits.
For more information, see the VCAC website. (Reference Executive Order 12-17, 2017)

Carbon Reduction Procurement Policies

The Vermont Agency of Administration and the Climate Cabinet must revise state acquisition policies to ensure consideration of vendor business practices that promote clean energy and address climate change. Policies should consider, for example, the use of and support of plug-in electric and zero emission vehicles, including providing workplace charging stations. (Reference Executive Order 05-16, 2016)

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 State Board of Education Rules and Practices 6001 through 6005, and Vermont Statutes Title 23, Chapter 13, Section 1282)

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)