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Pennsylvania E85 Laws and Incentives


State Incentives

Alternative Fuel Vehicle (AFV), Hybrid Electric Vehicle (HEV), and Fueling Infrastructure Funding

The Alternative Fuels Incentive Grant (AFIG) program is administered by the Pennsylvania Department of Environmental Protection and provides financial assistance and information on alternative fuels, AFVs, HEVs, plug-in hybrid electric vehicles, anti-idling technologies that use alternatives to diesel fuel for heavy-duty trucks, and advanced vehicle technology research, development, and demonstration. The AFIG program provides grant funding to school and vocational school districts, municipal authorities, counties, cities, boroughs, incorporated towns, county institution districts, nonprofit entities, corporations, limited liability companies, or partnerships incorporated or registered in the Commonwealth of Pennsylvania. Projects that result in product commercialization and the expansion of Pennsylvania companies will be favored in the selection process.(Reference Pennsylvania General Acts 178, 2004, and Special Session Senate Bill 22, 2008)

Renewable Energy Grants

Pennsylvania Energy Development Authority (PEDA) provides grants and loan guarantees for alternative energy projects and related research referring to deployment projects, manufacturing, or research. PEDA funding is available for projects involving clean, alternative fuels for transportation, biomass, and fuel cells. Another grant program, the Pennsylvania Energy Harvest Grant, seeks to deploy cleaner energy sources by providing funding for renewable energy technologies, such as biomass energy projects. For more information, see the Department of Environmental Protection Grant and Loan Programs Web site.

State Laws and Regulations

Establishment of Alternative Fuel Production Tax Credits

The Alternative Energy Production Tax Credit Program is established to provide incentives related to the production of alternative fuels, as well as the research and development of technology to provide alternative fuels. The Pennsylvania Department of Environmental Protection, in consultation with the Department of Revenue, will establish regulations necessary for the implementation of this program. (Reference Special Session House Bill 1, 2008)

Energy Independence Strategy

The PennSecurity Fuels Initiative, established in 2006, aims to reduce dependence on foreign oil by replacing 900 million gallons of the Commonwealth's transportation fuels with alternative sources over the next decade. The initiative requires that retail transportation fuels contain a certain percentage of biodiesel or ethanol, and it also invests $30 million in existing funds from the Commonwealth's Alternative Fuels Incentive Grant program to build alternative fuel production and fueling infrastructure over the next five years. The initiative also includes the creation of incentives that open new markets to Pennsylvania farmers who grow the feedstocks used to produce ethanol and biodiesel, and the creation of safeguards against alternative fuel price increases. For more information on the PennSecurity Fuels Initiative see the Pennsylvania Department of Environmental Protection Web site.

Biodiesel Committee

The Governor's Renewable Agricultural Energy Council was established to make recommendations to the Governor on policies, regulations, and legislation that will aid in the development of renewable energy. The Governor has appointed four experts in agricultural energy (including ethanol and biodiesel) to the Council. (Reference Executive Order 2005-08, 2005)

Alternative Fuels Tax

A tax is imposed on alternative fuels used to propel vehicles of any kind on public highways. The rate of tax is determined on a gasoline gallon equivalent basis. (Reference Pennsylvania Consolidated Statutes, Title 75, Section 9004)