Indiana Incentives and Laws
Last Updated April 2008
Indiana is the home of the Central Indiana Clean Cities Alliance, Inc. (www.cicca.org) and the South Shore Clean Cities Coalition (www.southshorecleancities.org). Coordinator contact information is listed in the Points of Contact section.
State Incentives
Alternative Fuel Vehicle (AFV) Manufacturer Tax Credit
The Indiana Economic Development Corporation (IEDC) may award tax credits under the Hoosier AFV Manufacturer Tax Credit to foster job creation, reduce dependency on imported energy sources, and reduce air pollution resulting from the manufacture or assembly of AFVs in Indiana. AFV manufacturers are eligible for tax credits of up to 15% of the qualified investment for which the credit is claimed. Qualified investments include expenditures in the state that are reasonable and necessary for the manufacture or assembly of AFVs. For the purpose of this incentive, AFVs are defined as vehicles designed to operate on E85, natural gas, liquefied petroleum gas, hydrogen, coal-derived liquid fuels, non-alcohol fuels derived from biological material, P-Series fuels, or electricity. Applications for this incentive must be reviewed and approved by the IEDC. The credit applies to taxable years beginning after December 31, 2006, and before December 31, 2012. Unused credits may be carried forward for up to nine consecutive taxable years. (Reference Indiana Code 6-3.1-31.9)
E85 Fueling Station Grant Program
Through the E85 Fueling Station Grant Program administered by the Indiana State Department of Agriculture (ISDA), grants of up to $20,000 per location are available toward the purchase of new E85 fueling equipment or the conversion of existing equipment to allow for E85 fueling. Applications for this grant program must be reviewed and approved by the ISDA, and the total amount of grants awarded for all fiscal years may not exceed $1 million. (Reference Senate Bill 360, 2008, and Indiana Code 15-9-5)
Point of Contact
Ann Schmelzer
Regional Development Program Manager
Indiana State Department of Agriculture
Phone (317) 232-8770
Fax (317) 232-1362
aschmelzer@isda.in.gov
E85 Storage Tank Cleaning Grants
Licensed fuel retailers in Indiana may be eligible for grants of up to $5,000 to be used for cleaning fuel storage tanks prior to introducing E85 into the storage tank. This grant program is offered by the Indiana Corn Marketing Council. Eligible licensed fuel retailers must be willing to commit to selling and actively promoting E85 for a minimum of two years.
Point of Contact
Mark Walters
Biofuels Director
Indiana Corn Marketing Council
Phone (317) 347-3620
Fax (317) 347-3626
mwalters@indianacorn.org
http://www.incorn.org/docs/incga/TankCleaningGrantForm.pdf
Ethanol Production Tax Credit
An ethanol producer located in Indiana is entitled to a credit of $0.125 per gallon of ethanol produced, including cellulosic ethanol. Applications for this incentive must be reviewed and approved by the Indiana Economic Development Corporation. The amount of credits granted to a single taxpayer may not exceed the following amounts for all taxable years:
| Tax Credit | Annual Production |
|---|---|
| $2 million | More than 40 million and less than 60 million gallons of grain ethanol |
| $3 million | At least 60 million gallons of grain ethanol | $20 million | At least 20 million gallons of cellulosic ethanol |
(Reference Indiana Code 6-3.1-28)
E85 Fuel Retailer Tax Credit
An E85 retailer is allowed to deduct $0.18 from the required state gross retail tax for every gallon of E85 sold during reporting periods ending before July 1, 2020. The Indiana Department of Revenue will publish an annual notice in the Indiana Register to indicate the total amount of funding available for reimbursement. (Reference Indiana Code 6-2.5-7-5 and 6-2.5-7-5.5)
E85 Fuel Use Tax Credit
A political subdivision, defined as a municipal corporation or special taxing district, is entitled to a monthly E85 incentive payment if at least 75% of the fuel purchased in the preceding calendar month by the political subdivision was E85 for use in flexible fuel vehicles (FFVs). The amount of the monthly payment is equal to $33.33 for each FFV owned by the political subdivision and only applies for FFVs that have been owned by the political subdivision for less than five calendar years. This credit expires January 1, 2015. (Reference Indiana Code 8-14-2-8)
Vehicle Research and Development Grants
The Indiana 21st Century Research and Technology Fund is administered by the Indiana Economic Development Corporation and provides grants and loans to support proposals for economic development in areas including alternative fuel technologies and fuel-efficient vehicle production. (Reference Indiana Code 5-28-16-2)
Point of Contact
Linda Peterson-Roe
Program Manager
Indiana 21st Century Research and Technology Fund
Phone (317) 234-4652
Fax (317) 232-6786
lpeterson-roe@iedc.in.gov
http://www.21fund.org/
Biodiesel Price Preference
A governmental body, state educational institution, or instrumentality of the state that performs essential governmental functions on a statewide or local basis is entitled to a 10% price preference for the purchase of fuels containing at least 20% biodiesel by volume or fuels that are primarily ester-derived (other than alcohol) made from biological materials, including oilseeds and animal fats, for use in operating compression and ignition engines. (Reference Indiana Code 5-22-15-19)
Biodiesel Production Tax Credit
A biodiesel producer located in Indiana is entitled to a credit of $1.00 per gallon of biodiesel produced. Applications for this incentive must be reviewed and approved by the Indiana Economic Development Corporation (IEDC). The total amount of credits granted to single taxpayer may not exceed $3 million for all taxable years, but may be increased to $5 million with prior approval from the IEDC. This tax credit is contingent upon funding and is currently not available. (Reference Indiana Code 6-3.1-27-8)
Biodiesel Blending Tax Credit
A biodiesel blender located in Indiana is entitled to a credit of $0.02 per gallon of blended biodiesel produced at a facility located in Indiana. Applications for this incentive must be reviewed and approved by the Indiana Economic Development Corporation, and the total amount of credits granted to single taxpayer may not exceed $3 million for all taxable years. This tax credit is contingent upon funding and is currently not available. (Reference Indiana Code 6-3.1-27-9)
Biodiesel Retailer Tax Credit
Through December 31, 2010, a taxpayer that is a fuel retailer and distributes blended biodiesel for retail purposes is entitled to a credit of $0.01 per gallon of blended biodiesel distributed. This tax credit is contingent upon funding and is currently not available. (Reference Indiana Code 6-3.1-27-10)
State Laws and Regulations
Regional Biofuels Promotion Plan
Indiana has joined Iowa, Kansas, Michigan, Minnesota, Ohio, South Dakota, and Wisconsin in adopting the Energy Security and Climate Stewardship Platform Plan (Platform) (PDF 2 MB), which establishes shared goals for the Midwest region, including increased biofuels production and use. Specifically, the Platform sets the following goals:
- Produce commercially available cellulosic ethanol and other low-carbon fuels in the region by 2012;
- Increase E85 availability at retail fueling stations in the region to 15% of stations by 2015, 20% by 2020, and 33% of all fueling stations in the region by 2025;
- Reduce the amount of fossil fuel that is used in the production of biofuels by 50% by 2025;
- By 2025, at least 50% of all transportation fuels consumed by the Midwest will be from regionally produced biofuels and other low-carbon transportation fuels.
The Platform also establishes a regional biofuels corridor program. The program directs state transportation, agriculture, and regulatory officials to develop a system of coordinated signage across the region for biofuels and advanced transportation fuels and to collaborate to create regional E85 corridors. The program requires standardized fuel product coding at fueling stations as well as increased education for retailers about converting existing fueling infrastructure to dispense E85. The state transportation, agriculture, and regulatory officials were required to report their corridor implementation plans to the Midwest Governors Association by April 1, 2008.
Biobased Products Purchase Requirement
A state governmental body or educational institution must purchase biobased products whenever possible, provided that biobased products are available and the purchase is economically feasible. Biobased products are defined as products produced from plant or animal sources that would otherwise be produced from petroleum-based sources. (Reference Indiana Code 5-22-5-9)
Immunity for Misuse of E85
E85 sellers, suppliers, distributors, manufacturers, and refiners are immune from civil liability for personal injury of property damage resulting from a person fueling any vehicle with E85 that is not a flexible fuel vehicle. This includes any vehicle equipped to operate when fueled entirely by E85. This immunity does not apply if an E85 seller, supplier, distributor, manufacturer, or refiner does not display all E85 warning signs required by federal or state law. (Reference Indiana Code 34-30-24)
E85 Promotion and Education
The Department of Agriculture is required to work with automobile manufacturers to improve auto dealer and consumer awareness and labeling of E85 fuel, and will work with the appropriate companies to include E85 fueling stations in updates of global positioning navigation software. (Reference Indiana Code 15-9-2-4)
E85 Retail Sales Reporting
A retailer who dispenses E85 must report to the Indiana Department of Revenue the total number of gallons of E85 sold from a metered pump as prescribed in Indiana Code 6-2.5-6. (Reference Indiana Code 6-2.5-7-5)
E85 and Ethanol Blend Definitions
E85 is a fuel blend nominally consisting of gasoline and at least 75% anhydrous ethyl alcohol by volume that meets ASTM specification D5798. A gasoline-ethanol blend is fuel that is blended from gasoline and nominally anhydrous ethyl alcohol and is suitable for use in spark-ignition internal combustion engines. Gasoline-ethanol blends must meet ASTM specification D4814. (Reference Indiana Code 6-6-1.1-103 and 16-44-2-8)
E85 Use
As part of the Indiana Greening the Government Initiative, all fleet vehicles based in Indianapolis that are capable of using E85 are directed to fuel with E85 at the designated City-State fueling site whenever possible. Use of other bio-based fuels and oils is also encouraged. (Reference Executive Order 05-21, 2005 (PDF 670KB)Download Adobe Reader
Biodiesel Blend Fuel Tax Exemption
Biodiesel blends of at least 20% that are used for personal, noncommercial use by the individual that produced the biodiesel content of the fuel are exempt from the $0.16 per gallon license tax. The number of gallons of fuel for which the exemption may be claimed is based on the percentage volume of biodiesel in each gallon used. ((Reference Indiana Code 6-6-2.5-30.5)
Biodiesel Definition
Biodiesel is defined as a renewable, biodegradable fuel derived from agricultural plant oils or animal fats that meets ASTM specification D6751. Blended biodiesel is a blend of biodiesel with petroleum diesel fuel so that the volume percentage of biodiesel in the blend is at least 2%. (Reference Indiana Code 6-3.1-27-2 and 6-6-2.5-1.5)
Biofuels Blend Use
Governmental entities are required to fuel diesel vehicles with biodiesel blends of at least 2% and fuel gasoline vehicles with ethanol blends of at least 10% whenever possible. (Reference Indiana Code 5-22-5-8)
Low-Speed Vehicle Access to Roadways
A low-speed vehicle is defined as a four-wheeled electric vehicle capable of achieving a maximum speed of 35 miles per hour (mph) with a maximum weight of 2200 pounds that meets the standards in Title 49 of the Code of Federal Regulations, sections 571.500. The use of low-speed vehicles on local highways is subject to regulation by local transportation authorities. An individual may not operate a low-speed vehicle on a highway that has a posted speed limit greater than 35 mph. (Reference Indiana Code 9-21-5-8.5 and 9-13-2-94.5)
Certified Technology Park Designation
The Indiana Economic Development Corporation may designate an area as a certified technology park if certain criteria are met, including a commitment from at least one business engaged in a high technology activity that creates a significant number of jobs. The establishment of high technology activities and public facilities within a technology park serves a public purpose and benefits general welfare by encouraging investment, job creation and retention, and economic growth and diversity. A High technology activity includes advanced vehicles technology, which is any technology that involves electric vehicles, hybrid electric vehicles, or alternative fuel vehicles, or components used in the construction of these vehicles. (Reference Indiana Code 36-7-32)
Alternative Fuel Vehicle (AFV) Decals
An individual may place alternative fuel into the fuel tank of a motor vehicle only if the vehicle has a valid alternative fuel decal affixed to the front windshield. Vehicle decals must be purchased annually for all heavy-duty AFVs and for light- and heavy-duty AFVs owned by public or private utilities. The cost of the decal varies according to vehicle type and gross vehicle weight. The annual fee may be prorated if the vehicle is newly purchased, registered in Indiana, or converted to operate using an alternative fuel. (Reference Indiana Code 6-6-2.1-203 through 6-6-2.1-206)
Point of Contact
Fuel Tax Section
Indiana Department of Revenue
Phone (317) 615-2630
http://www.in.gov/dor
Natural Gas Vehicle (NGV) Safety Requirement
NGVs may not operate on a highway outside the corporate limits of a municipality from a half hour after sunset to a half hour before sunrise unless the vehicle carries at least three red electric lanterns or three portable red emergency reflectors. NGVs are prohibited from carrying a flare, fuse, or signal produced by flame. (Reference Indiana Code 9-19-5-6)
Utilities/Private Incentives
Natural Gas Vehicle (NGV) Rebate
Citizens Gas & Coke Utility offers a rebate of $1,500 per vehicle that is converted to operate on compressed natural gas (CNG) or for the purchase of an original equipment manufactured dedicated or bi-fuel CNG vehicle. Used NGVs may also qualify. Rebates are only available to fleet operators. Each project is examined on the merits of providing the rebate, based on hours of operation or miles driven, per vehicle, per year. Citizens Gas & Coke Utility also provides public vehicle fueling at several existing CNG fueling stations.
Point of Contact
Abed Darwish
Sales Manager
Citizens Gas & Coke Utility
Phone (317) 927-4564
adarwish@cgcu.com
http://www.citizensgas.com
Points of Contact:
| NAME/EMAIL | AGENCY | TITLE | PHONE/FAX |
|---|---|---|---|
| Kellie Walsh klwcicca@aol.com | Central Indiana Clean Cities Alliance, Inc. | Executive Director | Phone: (317) 834-3754 or (317) 985-4380 Fax: (317) 834-3754 | Carl Lisek southscc@comcast.net | South Shore Clean Cities, Inc. | Clean Cities Coordinator | Phone: (219) 365-4289 Fax: (219) 365-5465 | Kay (Milewski) Kelly kay.kelly@netl.doe.gov | U.S. Department of Energy, National Energy Technology Laboratory | Project Manager | Phone: (304) 285-4535 Fax: (304) 285-4638 | Ann Schmelzer aschmelzer@isda.in.gov | Indiana State Department of Agriculture | Regional Development Program Manager | Phone: (317) 232-8770 Fax: (317) 232-1362 | Linda Peterson-Roe lpeterson-roe@iedc.in.gov | Indiana 21st Century Research and Technology Fund | Program Manager | Phone: (317) 234-4652 Fax: (317) 232-6786 | Mark Walters mwalters@indianacorn.org | Indiana Corn Marketing Council | Biofuels Director | Phone: (317) 347-3620 Fax: (317) 347-3626 | Abed Darwish adarwish@cgcu.com | Citizens Gas & Coke Utility | Sales Manager | Phone: (317) 927-4564 Fax: | Shawn Seals sseals@idem.in.gov | Indiana Department of Environmental Management, Office of Air Quality | Senior Environmental Planner | Phone: (317) 233-0425 Fax: (317) 233-5967 | Indiana Department of Revenue | Fuel Tax Section | Phone: (317) 615-2630 Fax: | Scott Benson scott.benson@gsa.gov | U.S. General Services Administration | Transportation Specialist, Great Lakes Region | Phone: (312) 886-8682 Fax: (312) 353-0989 |
