Search Federal and State Laws and Incentives

The Colorado state fleet and the Colorado Department of Transportation (CDOT) must purchase natural gas vehicles (NGVs) where natural gas fueling is available or planned, whenever possible. Where NGVs are not viable options, other alternative fuel vehicles (AFVs) such as plug-in electric, hybrid electric, and propane vehicles, must be considered. All new vehicles purchased must be either alternatively fueled or exceed federal Corporate Average Fuel Economy standards.

In addition, CDOT and the Colorado Department of Personnel and Administration (DPA) must include AFVs in state pricing agreements; AFVs include compressed natural gas, hybrid electric, plug-in electric, and propane vehicles. CDOT and DPA must also determine opportunities to expand state pricing into alternative fuel and fuel-efficient heavy-duty equipment, as well as into idle reduction technologies and telematics.

(Reference Executive Order D 2015-013, 2015)

The Colorado Energy Office, Department of Transportation (CDOT), Department of Public Health and Environment, and Department of Personnel and Administration (DPA) will establish a State Fleet Sub-Council (Sub-Council) to help develop, implement, and improve programs, plans, and policies that save money, reduce emissions, promote domestic fuel use, and conserve natural resources. The Sub-Council will:

• Develop standard procedures and formulas for modeling and monitoring potential alternative fuel vehicles (AFVs) and fuel reduction efforts that link acquisition and operations budgets;
• Create an idle reduction policy for state agencies;
• Create a process that allows fleet coordinators to replace vehicles with AFVs before standard retirement age if the replacement is cost-effective;
• Identify and evaluate other fuel-saving practices and develop procedures for their implementation; and
• Evaluate alternative financing options for state fleet vehicles including leasing, energy performance contracting, and other options that may reduce costs.

In addition, DPA and CDOT will establish policies and procedures to promote the cost-effective use of non-petroleum fuel vehicles and other fleet efficiency improvements. The policies must strive for the use of non-petroleum based fuels at least 90% of the time when cost-effective.

(Reference Executive Order D 2015-013, 2015)

The Colorado Energy Office administers Refuel Colorado Fleets, a free energy coaching program for fleet managers and communities. The program helps fleet managers identify AFV options and develop a business case. Energy coaches guide fleet managers through the acquisition process by providing technical expertise on issues such as fueling, incentives, maintenance, and safety. Energy coaches also work with local leaders, fuel providers, and dealerships to encourage AFV development in each community. For more information, including a list of regional contacts, see the Refuel Colorado Fleets website.

Government fleets may finance the lease or purchase cost of alternative fuel vehicles and alternative fueling infrastructure through energy performance contracts where vehicle operational and fuel cost savings pay for the capital investment. Energy performance contracts must show that the annual cost savings associated with the fueling and maintenance of vehicles with higher efficiency ratings or alternative fueling methods is equal to or higher than the annual contract payments. (Reference Colorado Revised Statutes 24-30-2001 through 24-30-2003 and 29-12.5-101 through 29-12.5-104)

The Advanced Industries (AI) Accelerator Programs promote growth and sustainability in Colorado's advanced industries. Grants may be available for advanced industries such as vehicle and component manufacturing and biofuels. Four types of grants are available, including Proof of Concept, Early-Stage Capital & Retention, Infrastructure Funding, and AI Exports. For more information on each grant program, including eligibility requirements and how to apply, see the Colorado Office of Economic Development & International Trade's Advanced Industries Accelerator Programs website.

Diesel-electric hybrid vehicles that are titled and registered in Colorado are eligible for a tax credit. Light-duty diesel electric hybrid passenger vehicles with a minimum fuel economy of 70 miles per gallon are eligible for a credit of 15% of the difference of the actual cost of purchasing or leasing the vehicle and purchasing or leasing the same or most similar traditional fuel vehicle.

Light-duty passenger vehicles, light-duty trucks, or medium-duty diesel-electric truck conversions that increases the original fuel economy by at least 40% are eligible for a tax credit equal to 25% of the actual cost of the conversion.

These tax credits expire January 1, 2017.

(Reference House Bill 16-1332, 2016, and Colorado Revised Statutes 39-22-516.5, 39-22-516.7, and 39-22-516.8)

The Colorado Department of Transportation (CDOT) allows hybrid electric vehicles (HEVs) and inherently low emission vehicles (ILEVs) to travel in HOV and high occupancy toll (HOT) lanes. Qualifying vehicles must obtain a permit and display an HOV exemption decal and a toll transponder. CDOT reached its quota of 2,000 permits and will place new applicants on a waiting list (verified June 2016). For more information, visit the CDOT Hybrid Vehicle Use in the HOT/HOV Lanes website. (Reference Colorado Revised Statutes 42-4-1012)