Search Federal and State Laws and Incentives

Plug-In Electric Vehicle (PEV) and Fuel Cell Electric Vehicle (FCEV) Infrastructure and Battery Tax

Public lands used for installing, maintaining, and operating PEV infrastructure are exempt from leasehold excise taxes. Additionally, the state sales and use taxes do not apply to PEV and FCEV batteries or fuel cells; labor and services for installing, repairing, altering, or improving PEV and FCEV batteries or fuel cells and PEV and hydrogen fueling infrastructure; the sale of property used for PEV and hydrogen fueling infrastructure, and the sale of zero emission buses. (Reference Revised Code of Washington 82.29A.125, 82.08.816, and 82.12.816)

Low Carbon Fuel and Fuel-Efficient Vehicle Acquisition Requirement

Washington state agencies must consider purchasing low carbon fuel vehicles or converting conventional vehicles to use low carbon fuels when financially comparable over the vehicle's useful life. Low carbon fuels include hydrogen, biomethane, electricity, or natural gas blends of at least 90%. State agencies must achieve an average fuel economy of 36 miles per gallon (mpg) for passenger vehicle fleets in motor pools and leased conventional vehicles. State agencies must also purchase low carbon fuel vehicles or, when purchasing new conventional vehicles, achieve an average fuel economy of 40 mpg for light-duty passenger vehicles and 27 mpg for light-duty vans and sport utility vehicles. When calculating average fuel economy, emergency response vehicles, passenger vans with a gross vehicle weight rating of 8,500 pounds or greater, off-road vehicles, low carbon fuel vehicles, and vehicles driven less than 2,000 miles per year are excluded. (Reference Revised Code of Washington 43.19.622)

Renewable Natural Gas and Renewable Hydrogen Fuel Sales Regulations

Public utility districts are authorized to sell renewable natural gas and renewable hydrogen to facilities that condense or dispense natural gas or renewable hydrogen for use as a motor fuel. Renewable natural gas is defined as methane gas or other hydrocarbons derived from organic materials. Renewable hydrogen is defined as hydrogen produced using renewable resources as the source of the hydrogen and the source for the energy input into the production process. (Reference Revised Code of Washington 54.04.190)

Alternative Fuel Commercial Vehicle and Fueling Infrastructure Tax Credit

Businesses are eligible to receive tax credits for purchasing new alternative fuel commercial vehicles and installing alternative fueling infrastructure. Eligible alternative fuels are natural gas, propane, hydrogen, dimethyl ether, and electricity. Tax credits for qualified alternative fueling infrastructure are for up to 50% of the cost to purchase and install the infrastructure. Commercial vehicle tax credit amounts vary based on gross vehicle weight rating (GVWR) and are up to 75% of the incremental cost, with maximum credit values as follows:

This exemption also applies to qualified used vehicles modified with a U.S. Environmental Protection Agency-certified aftermarket conversion, as long as the vehicle is being sold for the first time after modification. Modified vehicles are eligible for credits equal to 30% of the commercial vehicle conversion cost, up to $25,000.

Each entity may claim up to $250,000 or credits for 25 vehicles per year. Credits may be earned between January 1, 2016, and January 1, 2021. All credits earned must be used in that calendar year or the subsequent year. Tax credits are available on a first-in-time basis and are subject to annual limits of $2 million for vehicle credits, and $6 million for infrastructure.

(Reference Revised Code of Washington 82.16.0496 and 82.04.4496)

Alternative Fueling Infrastructure Grant Program

The Washington State Department of Transportation (WSDOT) offers competitive grants to strengthen and expand the West Coast Electric Highway network by deploying electric vehicle supply equipment with Level 2 and direct current (DC) fast chargers and hydrogen fueling infrastructure along highway corridors in Washington. Eligible project costs include siting, equipment purchases, electrical upgrades, installation, operations, and maintenance. For more information, including funding availability and application periods, see the WSDOT Innovative Partnerships - Electric Vehicle Charging Infrastructure website. (Reference Revised Code of Washington 47.04.350)

Volkswagen (VW) Settlement Allocation

The Washington State Department of Ecology (Ecology) will work with the Office of the Governor and state agencies to select projects and distribute funding to leverage 15% of Washington's portion of the VW Environmental Mitigation Trust for the acquisition, installation, operation, and maintenance of light-duty zero-emission vehicle charging infrastructure.

Ecology will establish a competitive process to identify and select projects to fund with the remaining 85% of the appropriation to maximize total air pollution reduction and health benefits, improve air quality in areas disproportionately affected by air pollution, leverage additional matching funds, achieve substantial emission reduction beyond what would occur absent the funding, accelerate fleet turnover to the cleanest engines, and accelerate adoption of electric vehicles, equipment, and vessels. As appropriate, Ecology will work with state agencies to select projects and distribute funding. For more information, see the Ecology VW Enforcement Action website.

Green Transportation Grant Program

The Washington State Department of Transportation (WSDOT) will establish a green transportation capital grant program to fund projects to reduce the carbon intensity of the Washington transportation system, including fleet electrification, modification or replacement of facilities to facilitate fleet electrification and hydrogen fueling, upgrades to electrical transmission and distribution systems, and construction of charging and fueling infrastructure. In order to receive funding for a project, a transit authority must provide matching funding for that project that is at least equal to 20% of the total cost of the project. (Reference Revised Code of Washington 47.66.120)

Alternative Fuel Vehicle (AFV) Car Share Pilot Program

The Washington State Department of Transportation (WSDOT) will develop a pilot program to provide AFV use opportunities to underserved and low-income communities and to those without easy access to transportation corridors. (Reference Revised Code of Washington 47.04.355)

Retail Sales and Use Tax Exemption

The retail sales and state use tax of 6.5% does not apply to the sale or lease of new or used passenger vehicles, light-duty trucks, and medium-duty passenger vehicles that are exclusively powered by an alternative vehicle fuel or are capable of running solely on electricity for at least 30 miles. Eligible alternative fuels are natural gas, propane, hydrogen, and electricity. Vehicles must not have a selling price plus trade-in property value that exceeds $45,000 for new vehicles and $30,000 for used vehicles. The maximum eligible amount for used purchased or leased vehicles is $16,000. The maximum eligible amounts for new purchased or leased vehicles are as follows:

For more information, see the Renewable Energy/Green Incentives section of Washington Department of Revenue's Incentives Programs website.

(Reference Revised Code of Washington 82.12.9999)

Alternative Fuel Vehicle (AFV) Technical Assistance and Education Program

The Washington State University (WSU) Energy Program must establish and administer a technical assistance and education program on the use of AFVs for public agencies, including state and local governments. For more information, visit the WSU Energy Program Green Transportation Program website. (Reference Revised Code of Washington 28B.30.903)

Medium- and Heavy-Duty Zero Emission Vehicle (ZEV) Deployment Support

California, Colorado, Connecticut, District of Columbia, Hawaii, Maine, Maryland, Massachusetts, New Jersey, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, and Washington (signatory states) signed a memorandum of understanding (MOU) to support the deployment of medium- and heavy-duty ZEVs through involvement in a Multi-State ZEV Task Force (Task Force).

By January 2021, the Task Force will develop a multi-state action plan to support electrification of medium- and heavy-duty vehicles. The Task Force will consider actions to accomplish the goals of the MOU, including limiting all new medium- and heavy-duty vehicles sales in the signatory states to ZEVs by 2050. The signatory states will also seek to accelerate the deployment of medium- and heavy-duty ZEVs to benefit disadvantaged communities and explore opportunities to coordinate and partner with key stakeholders.

For more information, see the Medium- and Heavy-Duty ZEVs: Action Plan Development Process website.

Low Carbon Fuel Standard

The Washington Department of Ecology will develop rules to establish a Clean Fuels Program (Program) that reduces the overall carbon intensity of transportation fuels used in the state by 20% below 2017 levels by 2035. The Program standards must be based on the carbon intensity of gasoline, gasoline substitutes, diesel, and diesel substitutes. The Program must go into effect no later than January 1, 2023. (Reference House Bill 1091, 2021)