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State offers incentives for alternative-fuel use

Tax exemptions, tax credits, loans, grants are available

The Utah Office of Energy Services has started promoting tax credits and offering low-interest loans to businesses and interest-free loans to public and government entities that use fuels other than gasoline and diesel fuel.

The energy office, part of the Division of Community Development, singled out Newspaper Agency Corp. (NAC), which handles advertising, printing and circulation for the Deseret News and the Salt Lake Tribune, for operating vehicles that run on compressed natural gas (CNG) and propane.

The OES said the switch has enabled NAC to cut emissions from its vehicles by some 67,000 pounds per year.

NAC fleet manager Robin Erickson said the agency also has seen significant cost savings because alternative fuels are less expensive and maintenance costs on the vehicles are lower.

Ran MacDonald, environmental engineer at the Utah Division of Air Quality, said about 60 percent of the pollutants fouling the air along the Wasatch Front come from conventional motor vehicles, so any move away from gasoline and diesel-powered cars, trucks and SUVs should help clear the air.

The incentives being offered comprise six separate strategies:

Tax credits — A state income tax credit of 50 percent of the cost, up to $3,000, of new, factory-built alternative fuel vehicles (AFVs) and half the cost of converting a gasoline vehicle to AFV status, up to $2,500, are available. The Division of Air Quality determines if a vehicle meets the requirements for AFV status, and the State Tax Commission determines the amount of the credit.

Fuel tax exemptions — AFVs that use compressed natural gas are eligible for a clean fuel tax exemption certificate. For an annual fee of $82, the certificate reduces the state fuel tax paid at the pump.

Grants — Grants are available to businesses and government agencies for up to half of the cost of buying a new alternative fuel vehicle or for converting a conventional vehicle to run on alternative fuels.

Loans — Loans at low interest rates are available to qualified businesses, and interest-free loans are available to state agencies, schools and public transit authorities for use in buying or converting AFVs, as well as the cost of the fueling equipment.

Fueling stations — Utah ranks fourth in the nation in the number of compressed natural gas fueling stations, stretching from Logan to St. George. Propane is also widely available, and four ethanol stations are planned for opening in Salt Lake County next year.

Vehicle availability — There are more models and varieties of AFVs than most people imagine, including cars, trucks and vans. Local auto dealers can provide information on what is available locally.

For more information, call Lisa Yoder in the Office of Energy Services, 538-8767, or toll free at 1-800-662-3633.