Tennessee Preps Second Round of Natural Gas, Propane Vehicle Grant Program


The Tennessee Department of Environment and Conservation’s Office of Energy Programs (TDEC OEP) has released a notice of intent to issue a second round of funding under the Tennessee Natural Gas and Propane Vehicle Grant Program. The program assists public, non-profit, and private Tennessee-based fleets with the investment in, and purchase of, natural gas or propane-powered vehicles.

The sound round of the program, managed by TDEC OEP, is limited to one application per grantee, per location. Applications may address a variety of eligible vehicle types and uses.


  • $1.7 million will be available under this competitive funding opportunity.
  •  Each grant will provide up to 70% of the incremental purchase cost of eligible vehicles, with a maximum grant of $25,000 for each eligible vehicle.
  • The maximum amount that may be awarded to a grantee shall not exceed $250,000.


  • A project must propose to receive funding for a minimum of one vehicle.
  • Eligible vehicles must either (1) be purchased new, from an original equipment manufacturer (OEM) or OEM-authorized dealer or (2) be converted to run on natural gas or propane through an EPA-certified, after-market conversion.
  • Vehicles must be registered within the state of Tennessee, unless the vehicle is to receive International Registration Plan (IRP) apportioned registration. In the case of the latter, the entity applying for a grant must submit a letter, certifying the percentage of time that the vehicle is expected to operate within Tennessee.
  • Eligible vehicles include dedicated compressed natural gas vehicles, dedicated liquefied natural gas vehicles, and dedicated propane-powered vehicles. Natural gas or propane-powered bi-fuel vehicles, or vehicles that are capable of operating on gasoline or diesel in addition to natural gas or propane, shall be eligible for emergency response vehicles only. (All bi-fuel vehicles will be required to utilize either natural gas or propane for no less than 75% of the vehicle’s fuel use for a period of no less than five years. The grant amount available to bi-fuel vehicles will be 75% that of dedicated vehicles. Bi-fuel vehicles will therefore only be eligible to receive no more than 52.5% of the conversion or incremental purchase cost, up to $25,000 for each eligible vehicle.)
  • Light, medium, and heavy-duty vehicles will be considered eligible, as there will be no gross vehicle weight restrictions or requirements.
  • Applicants must intend to maintain operations in Tennessee for a minimum of six years.

Application forms for the second round of the Tennessee Natural Gas and Propane Vehicle Grant Program are expected to be released in the coming months. For more information about this program, or about other TDEC sustainable transportation efforts, contact Alexa Voytek at Alexa.Voytek@tn.gov or 615-532-0238.


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