Federal and state incentive programs, in the form of grants, rebates and tax credits are becoming a valuable tool to encourage fleets to purchase natural gas vehicles.
Incentives help reduce the incremental cost of a natural gas vehicle, and decrease the payback time. We explored this topic in a previous blog post.
Several programs are available to help fleets. Currently, California, Texas and Pennsylvania have the most robust incentive programs for both heavy haul and automotive sectors – many other states offer ongoing incentive programs through tax credits or vehicle rebates.
Valerie Parr, Westport’s Grants Analyst, helps customers complete grant applications in the state or province in which they operate.
“Government agencies offering incentives are working to get older, less clean technology off the road,” she says. “These programs illustrate how deployment of natural gas vehicles and infrastructure build-out are being encouraged at the federal, state and provincial levels and ultimately propel the transportation industry towards cleaner opportunities.”
Grant applications are evaluated based on specific criteria, such as the age of the vehicle being replaced, expected distance travelled and emissions that will ultimately be reduced. Applications require some calculations and a plan demonstrating how fleets will save fuel and reduce emissions. Many programs have goals to reduce emissions within “non-attainment areas” – areas which have the worst emissions, often near ports or large cities.
Valerie says applications often require proof of how much time a fleet is spending in the designated non-attainment areas; reporting to the funding agency for a few years after the vehicle purchase is standard. Some programs are open for a limited time, often only eight weeks is provided to get applications in, while others are open for nine months.
The recently-announced New York Truck Voucher Incentive Program is designed as first-come, first-served until the total amount of funds is exhausted. Kate Muller, Director of Communications, says the goal of the program is to encourage the adoption of new cleaner technologies by reducing the cost to the consumer.
“These early sales help to reduce the price of future vehicles by creating economies of scale in production,” she says. “The New York State Energy Research and Development Authority (NYSERDA) estimates that this program could encourage the purchase or retrofit of up to 1,000 low-emission trucks in areas of the state with the poorest air quality.”
It includes six million in vouchers of up to $40,000 for the purchase or lease of an alternatively-fuelled vehicle, including a compressed natural gas (CNG) vehicle, in New York City.
Westport also works with agencies, such as the Texas Commission for Environmental Quality to ensure our vehicles meet specifications required to qualify for natural gas-related grants, rebates or tax credits. For certain state incentive programs, vehicles must meet EPA and CARB certification standards in order to qualify.
Andrea Morrow, spokesperson for The Texas Commission on Environmental Quality, says the program has been an effective way to encourage the transition to cleaner vehicles powered by alternative fuels.
“In the last ten years, the program awarded more than $858 million for the upgrade or replacement of 14,685 heavy-duty vehicles, locomotives, marine vessels, and pieces of equipment,” she says. Upgrades or replacements included natural gas and diesel.
Westport has a list of all the available incentives in North America, updated regularly to ensure up-to-date information, available here.