Florida Gov. Rick Scott signed H.B.579 on Friday, positioning the state as a likely new hotbed of activity for natural gas vehicle (NGV) deployment.
The Florida Natural Gas Vehicle Act – which passed both chambers of the state legislature earlier this spring without partisan rancor – wipes out the existing alternative fuel decal system. In its place is a five-year tax-free holiday (sales tax, excise tax and otherwise) on compressed natural gas (CNG), liquefied natural gas (LNG) and propane autogas.
Depending on how much natural gas or propane your fleet consumes, this piece of the bill can offer a huge economic upside, says Eric Criss, chairman of the Florida Natural Gas Vehicle Coalition.
Once the holiday ends, natural gas and propane that are used in transportation applications will be taxed at $0.21/gallon. Diesel is taxed at $0.31/gallon.
On top of this key measure, which goes into effect on Jan. 1, 2014, the legislation also establishes a ‘natural gas fuel fleet vehicle rebate program’ that is funded with an initial appropriation of $30 million.
The incentives for NGV and propane vehicles will be effective for fiscal years 2013-2014 through 2017-2018. In each of those years, $6 million in rebate funds will be available. The state Department of Agriculture and Consumer Services (DACS) will be administering the program, and the agency is tasked with developing all of the rebate specifics through a rule-making process that must be complete by the end of this year.
Right now, the details related to the rebates are a bit skeletal. G. David Rogers and Dale Calhoun, both from the Florida Natural Gas Association, confirm with NGT News that 60% of the program funding will go to private fleets, and 40% is earmarked for government fleets. In the context of the new law, a ‘fleet’ is an entity that owns/leases and operates at least three vehicles of any classification.
The rebates will cover up to 50% of the incremental cost of a new NGV or propane vehicle (or natural gas or propane conversion), capped at $25,000 per vehicle. The cap per entity is $250,000. Program funds will be made available on a first-come, first-served basis until that fiscal year's allocation is exhausted.
Rogers says the state's fleets were already very interested in NGVs and propane vehicles prior to the bill's passage and governor's signature. Now, those organizations are even more motivated to execute contracts and acquire vehicles, and he anticipates that the new law will have a ‘tremendous impact’ on the Florida NGV sector.
The bill, as signed by the governor, is available HERE.