Tennessee Incentives and Laws

Last Updated May 2006

State Incentives

Biodiesel Infrastructure Grants

The Tennessee State Energy Office, Department of Economic and Community Development, Energy Division offers grants to county governments for the installation of biodiesel infrastructure, such as biodiesel tanks and pumps and card readers, that can be used to provide biodiesel fuel for county/city owned vehicles such as school buses, maintenance vehicles, heavy equipment, or any other vehicle currently powered by diesel fuel. Grant funding will be provided for 50% of total project costs, but not more than $12,000 may be awarded per individual grant. Grants are limited to one per county.

Point of Contact

Terry Ellis
Program Manager
Tennessee State Energy Office, Department of Economic and Community Development, Energy Division
Phone (800) 342-1340 or (615) 741-2994
Fax (615) 741-5070
terry.ellis@state.tn.us
http://www.state.tn.us/ecd/energy_biodiesel.htm
 

Alternative Fuel Refueling Infrastructure Grants

The Tennessee Department of Transportation (TDOT) is authorized to undertake public-private partnerships with transportation fuel providers, including, but not limited to farmer co-ops, to install a network of refueling facilities. Refueling facilities include storage tanks and fuel pumps dedicated to dispensing biofuels, including but not limited to ethanol (E85) and biodiesel (B20). TDOT is also authorized to establish a grant program to provide financial assistance to help pay the capital costs of purchasing, preparing, and installing fuel storage tanks and fuel pumps for biofuels at private sector fuel stations. (Reference Tennessee Code 54-1-136)

State Laws and Regulations

Evaluation of High Occupancy Vehicle (HOV) Lane Exemption

The Tennessee Department of Transportation is urged to: study implementation of a policy exempting low emission and energy-efficient vehicles from the requirements of the HOV lane and implementing federal regulations; consult with the Federal Highway Administration regarding the proper implementation of such a policy; and report its findings and recommendations to the transportation committees of the state General Assembly. (Reference Senate Bill 2932, 2006)

Biofuels Committee

The Governor’s Interagency Alternative Fuels Working group, supported administratively by the Department of Environment and Conservation, has been established to develop a comprehensive state alternative fuels strategy that will provide a roadmap to make Tennessee a leader in the production, distribution, and use of biofuels. The Working Group is also tasked with developing a comprehensive, statewide public education and outreach campaign to increase public awareness and understanding of alternative fuels, particularly biofuels.
Furthermore, state agencies are required to strive to use ethanol and biodiesel in appropriate state-owned vehicles whenever possible and should support the development of biofuels refueling infrastructure. The Departments of General Services and Transportation are required to develop a program to educate state employees about the use of biofuels and publicize fuel availability as new refueling sites become available. The Department of Transportation must continue efforts to encourage development of publicly accessible biofuel refueling stations across the state. (Reference Executive Order 33, 2006)

Liquefied Petroleum Gas (LPG) Liability Immunity

Effective July 1, 2006, an individual or entity involved in the business of supplying, handling, transporting, or selling LPG at retail is immune from civil liability if injury or damage is caused by the use of LPG equipment in a manner or purpose other than that for which the LPG equipment was intended. (Reference House Bill 3581, Public Chapter Number 759, 2006, and Tennessee Code 29-34-207 and 68-135)

Biofuels Specifications

The Tennessee Department of Agriculture has the authority to inspect and test biofuels under the Kerosene and Motor Fuels Quality Inspection Act of 1989. (Reference Tennessee Code 47-18-1306)

Biodiesel Support

The Tennessee legislature recommends that a study committee be created to research renewable energy resources and their potential uses by private entities and state and local agencies, and encourages the use of renewable energy from biomass or bio-based products, including biodiesel. (Reference Senate Joint Resolution 251, 2005)

Liquefied Gas Tax

A use tax of $0.14 per gallon is imposed on liquefied gas used for the propulsion of motor vehicles on public highways. In addition, a user of liquefied gas for the propulsion of a motor vehicle on public highways shall pay an annual vehicle tax according to the following:

Government agencies are exempt from the Liquefied Gas Tax. "Liquefied gas" means all combustible gases that exist in the gaseous state at sixty degrees Fahrenheit and at a pressure of fourteen and seven-tenths pounds per square inch absolute, but does not include gasoline or diesel fuel or compressed natural gas. (Reference Tennessee Code 67-3-1101, 67-3-1102, 67-3-1103, and 67-3-1106)

Compressed Natural Gas (CNG) Tax and Permit

A use tax of $0.13 is imposed on CNG used for the propulsion of motor vehicles on public highways. For the purpose of determining the tax on CNG, a gallon equivalent factor of 5.66 pounds per gallon is used. Government agencies are exempt from this tax. A CNG vehicle user must apply for and obtain a CNG user's permit from the Commissioner of Revenue. (Reference Tennessee Code 67-3-1113, and 67-3-1114)

Low Speed and Neighborhood Electric Vehicle Access to Roadways

“Low speed vehicle" means any four-wheeled electric vehicle, excluding golf carts, whose top speed is greater than 20 mph but not greater than 25 mph, including neighborhood vehicles. Low speed vehicles may be operated only on streets where the posted speed limit is 35 miles per hour (mph) or less. This does not prohibit a low speed vehicle from crossing a road or street at an intersection where the road or street has a posted speed limit of more than 35 mph. (Reference Tennessee Code 55-8-101 and 55-8-191)

Utilities/Private Incentives

Natural Gas Technical Assistance

Atmos Energy offers preliminary feasibility studies for CNG refueling stations and vendor selection on a case-by-case basis.

Point of Contact

Walter C. Miller
Energy Services Consultant
Atmos Energy
Phone (817) 303-2903
Fax (817) 303-2929
walter.c.miller@atmosenergy.com
 

Tennessee Points of Contact: