Oklahoma Extends Tax Incentives for CNG Vehicles and Infrastructure

| USA: Oklahoma | Source: Government of Oklahoma and NGVAmerica
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The Government of the U.S. State of Oklahoma has revised and approved its legislation concerning tax credits as they apply to Compressed Natural Gas (CNG) vehicles and their refueling. Tax credits will be extended from January 1, 2020 through to December 31, 2027, a move welcomed by NGVAmerica and its members.

Dan Gage, President of NGVAmerica, released the following statement in regards to the extension of CNG incentives for vehicles and stations in Oklahoma:

“NGVAmerica applauds Governor Stitt for signing HB2095, the Clean Transportation Reform and Modernization Act of 2019. This will ensure that Oklahoma will consistently lead the country in supporting natural gas vehicles as the best path to build demand for an Oklahoma-produced product, clean the environment through targeting the highest mileage and dirtiest vehicles, and to provide economic benefit to the state and its constituents.

“The bill received industry-wide support from public, private and non-profit sectors that understand the need for this crucial infrastructure and the use of natural gas vehicles. With no expectation of increased state expenditures and no impact to state revenue as proven by the Oklahoma Tax Commission, we look forward to highlighting Oklahoma’s efforts as a model for the rest of the country to follow.”

Extracts from HB2095

The following extracts provide some details of the new legislation. Go to the link at the end to visit the full text.

Qualifying vehicles includes:

  • A motor vehicle which is propelled by gasoline or diesel fuel which has been modified by the installation of new equipment so that the vehicle may be propelled by compressed natural gas or liquefied natural gas.
  • A motor vehicle originally equipped so that the vehicle may be propelled by compressed natural gas or liquefied natural gas but only to the extent of the portion of the basis of such motor vehicle which is attributable to the storage of such fuel, the delivery to the engine of such motor vehicle of such fuel, and the exhaust of gases from combustion of such fuel.

For such clean-burning motor vehicles the maximum amount of the credit shall be as follows based upon gross vehicle weight of the qualified vehicle:

  • $5,500 – vehicles up to or below 6,000 lbs,
  • $9,000 – vehicles between 6,001 lbs to 10,000 lbs,
  • $26,000 – vehicles of 10,001 lbs, but not in excess of 26,500 lbs, and
  • $50,000 – vehicles in excess of 26,501 lbs.

Qualifying property includes:

  • Non-building equipment directly related to the delivery of compressed natural gas or liquefied natural gas, or hydrogen, for commercial purposes or for a fee or charge, into the fuel tank of a motor vehicle propelled by such fuel. This includes fuel compression equipment and storage tanks at the dispensing location.
  • Property which is directly related to the compression and delivery of natural gas from a private home or residence, for noncommercial purposes, into the fuel tank of a motor vehicle propelled by compressed natural gas. The property covered by this paragraph must be new and must not have been previously installed or used to refuel vehicles powered by natural gas.

For qualifying commercial property, a per location credit of 45% of the cost of the qualified clean-burning motor vehicle fuel property; and

For commercial property, a per-location credit of the lesser of 50% of the cost of the qualified equipment or $2,500.00.

For the taxable year beginning January 1, 2020, and each taxable year thereafter, the total amount of credits authorized by this section used to offset tax shall be adjusted annually to limit the annual amount of credits to $20 million.

The Act becomes effective 1 January, 2020. HB2095 can be viewed or downloaded here.

Natural Gas Vehicles for America (NGVAmerica) is a national organization dedicated to the development of a growing, profitable, and sustainable market for vehicles powered by natural gas or biomethane.
NGVAmerica represents more than 200 companies, environmental groups, and government organizations interested in the promotion and use of natural gas and biomethane as transportation fuels.

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