Indiana Incentives and Laws

Last Updated March 2006

State Incentives

Biofuels Grant Program

The Office of Energy and Defense Development (OED) and the Indiana State Department of Agriculture (ISDA) administers the Biofuels Grant Program to help fuel retailers increase the use of biofuels across the state. School districts, local government fleets, other large fleet operators, and refueling facility operators are eligible to apply for funding through the Biofuels Grant Program. Projects eligible for grants include the installation of E85 (85% ethanol blended fuel) or B20 (20% soybean oil blended diesel fuel) refueling infrastructure. Eligible projects must apply commercially available technologies; grants will not be awarded to fund research projects. Grant amounts are available up to a maximum of $25,000 for E85 or B20 infrastructure. If both E85 and B20 infrastructure are installed, a maximum grant of $50,000 will be considered. Matching funds of 50% are required, and only costs incurred after approval notification are eligible for funding. Applications for this grant program must be reviewed and approved by the OED and the ISDA.

Point of Contact

Cary Aubrey
Biofuels Program Administrator
Indiana State Department of Agriculture
Phone (317) 450-0652
Fax (317) 232-1362
caubrey@isda.in.gov
 

Point of Contact

Ryan Brown
Program Manager
Office of Energy and Defense Development
Phone (317) 232-8961
Fax (317) 232-1362
rbrown@oed.in.gov
http://www.in.gov/energy/applications
 

E85 Fuel Retailer Tax Credit

Effective July 1, 2006, E85 retailers are entitled to a credit against the state gross retail tax in the amount of $0.10 per gallon of E85 sold. The total amount of deductions allowed may not exceed $2 million for all retail merchants in all reporting periods. This incentive expires July 1, 2008. (Reference Senate Bill 353, 2006, and Indiana Code 6-2.5-7-5)

Biodiesel Production Tax Credit

A taxpayer that produces biodiesel at a facility located in Indiana is entitled to a credit of $1 per gallon of biodiesel that is used to produce blended biodiesel (diesel fuel blended with at least 2% biodiesel). Applications for this incentive must be reviewed and approved by the Indiana Economic Development Corporation (IEDC), and the IEDC will determine the maximum amount of credits a taxpayer is eligible to receive. (Reference Senate Bill 353, 2006, and Indiana Code 6-3.1-27-8)

Biodiesel Blending Tax Credit

A taxpayer that produces blended biodiesel at a facility located in Indiana is entitled to a credit of $0.02 per gallon of blended biodiesel. Both the biodiesel blend and the biodiesel used in the blend must be produced at a facility located in Indiana. Applications for this incentive must be reviewed and approved by the Indiana Economic Development Corporation. (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 by the taxpayer for retail purposes. (Reference Senate Bill 353, 2006, and Indiana Code 6-3.1-27-10)

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 price preference of 10% for the purchase of fuels which are at least 20% biodiesel by volume or a primarily ester-derived fuel (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)

State Laws and Regulations

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, which is 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 Senate Bill 353, 2006, and 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 refueling stations in updates of global positioning navigation software. (Reference Senate Bill 353, 2006, and Indiana Code 15-9-2-4)

E85 Retail Sales Reporting

Beginning July 1, 2006, 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 Senate Bill 353, 2006, and Indiana Code 6-2.5-7-5)

E85 Definition

E85 is a fuel blend nominally consisting of 85% ethanol and 15% gasoline that meets the American Society for Testing and Materials standard specification 5789-99 for fuel ethanol. (Reference Senate Bill 353, 2006, and Indiana Code 6-6-1.1-103)

Biodiesel Definition

Biodiesel is a renewable, biodegradable fuel derived from agricultural plant oils or animal fats that meets the American Society for Testing and Materials specification D6751 Standard Specification for Biodiesel Fuel (B100) Blend Stock for Distillate Fuels. 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%. B2 and B99 are the types of biodiesel blends with the least and most volume percentage of biodiesel fuel, respectively. (Reference Senate Bill 353, 2006, and Indiana Code 6-3.1-27 and 6-6-2.5-1.5)

Biofuels 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 refuel with E85 at the designated City-State refueling site whenever possible. Use of other bio-based fuels and oils is also encouraged. (Reference Executive Order 05-21, 2005)

Biodiesel Use

Governmental entities are required to fuel diesel vehicles with biodiesel whenever possible. (Reference Indiana Code 5-22-5-8)

Low Speed Vehicle Access to Roadways

Low speed electric vehicles (EVs) are considered to be passenger motor vehicles. The use of low speed EVs on local highways is subject to regulation by local transportation authorities. A person may not drive a low speed vehicle on a highway that has a speed limit greater than 35 miles per hour. Low speed vehicles must include standard equipment as outlined in Indiana Code. (Reference Indiana Code 9-21-5-8.5 and 9-13-2-94.5)

Certified Technology Park Designation

The Indiana Department of Commerce may designate an area as a certified technology park if certain criteria are met, including a firm commitment from at least one business engaged in a high technology activity creating 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. "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 Fuels Decal

Vehicle decals must be purchased annually for heavy-duty alternative fuel vehicles (AFVs) and for light- and heavy-duty AFVs owned by a public or private utility. Decal costs vary according to vehicle type and weight. The annual fee may be prorated if the vehicle is newly purchased, registered in Indiana, or converted to alternative fuel. (Reference Indiana Code 6-6-2.1-203)

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

Compressed natural gas vehicles 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 converted to operate on compressed natural gas (CNG) or for the purchase of an OEM dedicated or bi-fuel CNG vehicle. Used NGVs may also qualify. Rebates are available to fleet operators only. 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 refueling at two existing CNG refueling stations.

Point of Contact

Barbara Pesut-Hanley
Industrial Sales Consultant
Citizens Gas & Coke Utility
Phone (317) 927-4431
Fax (317) 927-4464
bpesut-hanley@cgcu.com
 

Indiana Points of Contact: