Alternative Fuels -- State Regulations for Montana

This page contains selected data from the Alternative Fuels Data Center (AFDC) at the U. S. Department of Energy. Additional details and the latest updates may be found at the AFDC summary page for Montana.

Fuel Use

State agency vehicles (recommendation)

The state of Montana encourages the use of alternative fuels and fuel blends to the extent that doing so produces environmental and economic benefits to the citizens of Montana. The Montana Legislature recommends several guidelines for the development of a state alternative fuels policy, including the following: 1) encourage the use of self-sufficient markets; 2) any state alternative fuels program should have measurable benefits and state agencies must communicate these benefits to the public; 3) state and local governments are encouraged to set an example with their vehicle fleets by using alternative fuels and fuel blends. The state also encourages alternative fuel and fuel blend production. (Reference�Montana Code Annotated 90-4-1011)

General

Tax Credit (vehicle conversion)

Businesses or individuals are eligible for an income tax credit of up to 50% of the equipment and labor costs for converting vehicles to operate using alternative fuels. Qualified alternative fuels are compressed and liquefied natural gas, liquefied petroleum gas (propane), hydrogen, electricity, and fuels containing at least 85% ethanol, methanol, ether, or another alcohol. The maximum credit is $500 for the conversion of vehicles with a gross vehicle weight rating (GVWR) of 10,000 pounds (lbs) or less, and $1,000 for vehicles with a GVWR of more than 10,000 lbs. The credit is only available during the year that the business or entity converts the vehicle. An alternative fuel seller may not receive a credit for converting its own vehicles to operate on the alternative fuel they sell. (Reference Montana Code Annotated 15-30-2320)

Tax Credit (biofuel storing or blending equipment)

Businesses and individuals are eligible for a tax credit of up to 15% of the cost of qualified equipment used for storing or blending biodiesel with petroleum diesel offered for sale. Biodiesel must be made entirely from components produced in Montana. The credit may not exceed $52,500 for a special fuel distributor and $7,500 for an owner or operator of a motor fuel outlet. The credit can be claimed in the two tax years before the year in which the business or individual begins blending biodiesel for fuel or sale. (Reference Montana Code Annotated 15-32-703)