Alternative Fuels -- State Regulations for Tennessee

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 Tennessee.

Vehicle Acquisition

All passenger vehicles - ozone non-attainment areas

The Tennessee Department of General Services must ensure that at least 25% of newly purchased passenger motor vehicles procured for use in areas designated as ozone nonattainment areas are hybrid electric vehicles (HEVs), provided that such vehicles are available at the time of procurement. If HEVs are not available, conventional gasoline vehicles achieving an average fuel economy of at least 25 miles per gallon (mpg) may satisfy the requirement. In areas not designated as ozone nonattainment areas, at least 25% of newly purchased passenger motor vehicles must be either HEVs or conventional gasoline vehicles achieving an average fuel economy of at least 25 mpg.State fleets must make every effort to ensure that 100% of newly purchased motor vehicles are energy-efficient vehicles. Energy-efficient vehicles are defined as passenger vehicles that are alternative fuel vehicles using alternative fuels, as defined by the Energy Policy Act of 1992; HEVs; conventional gasoline vehicles achieving an average fuel economy of at least 25 mpg; or vehicles powered by ultra-low sulfur diesel achieving an average fuel economy of at least 30 mpg. Additionally, state agencies should strive to use ethanol and biodiesel in appropriate state-owned vehicles whenever possible and should support the development of biofuels fueling infrastructure.(Reference Tennessee Code 4-3-1109 and Executive Order 33, 2006)

General

Contractual Requirement (biofuel blending)

Any provision in a contract between a fuel wholesaler and a refiner or supplier that limits or restricts the wholesaler's ability to blend petroleum products with ethanol or biodiesel is null and void. This regulation applies to contracts executed or renewed on or after January 1, 2010. (Reference Tennessee Code 47-25-2004)

Definition (biodiesel)

Biodiesel blend stock must be at least 99% biodiesel (no more than 1% diesel fuel) and meet ASTM specification D6751. Biodiesel blends must meet ASTM specification D975. Biodiesel blends made available for public use at a retail location may not exceed 20% biodiesel (B20), and biodiesel blends containing more than 5% biodiesel (B5) must be labeled as a biodiesel blend at the pump.(Reference Rules of the Tennessee Department of Agriculture 0080-5-12-.01, 0080-5-12-.02, and 0080-5-12-.03)

Definition (ethanol)

Ethanol is defined as nominally anhydrous ethyl alcohol meeting ASTM specification D4806. Ethanol blends made available for public use at a retail location must be labeled accordingly (e.g., E85).(Reference Rules of the Tennessee Department of Agriculture 0080-5-12-.01, 0080-5-12-.02, and 0080-5-12-.03)

Feedstock Requirement (biofuel blending)

Petroleum product refiners and suppliers must make all grades of gasoline and diesel fuel available to any wholesaler in a condition that allows for the fuel to be blended with ethanol or other biobased products and sold in Tennessee. In addition, gasoline products must be available with detergent additives in sufficient concentrations such that after the addition of ethanol, the final product meets or exceeds the lowest additive concentrations that the U.S. Environmental Protection Agency requires. (Reference Tennessee Code 47-25-2003)

Funding (alternative fueling infrastructure)

The Tennessee Department of Environment and Conservation provides funding for alternative fueling infrastructure improvements through the FastTrack Infrastructure Development Program. Private sector businesses may use funds to locate or expand fueling infrastructure in the state and to create or retain jobs for Tennesseans. Other restrictions may apply.

Liability Immunity (LNG, propoane, natural gas)

An individual or entity that supplies, handles, transports, or sells liquefied petroleum gas (LPG or propane) or natural gas at a retail station is immune from civil liability if incorrect use of the fueling equipment causes injury or damage. In order to be immune, the fuel provider must have exercised reasonable care of the equipment and taken reasonable steps to warn the customer of the hazards associated with misuse of the equipment. (Reference Senate Bill 2717, 2012, and Tennessee Code 29-34-207)

Tax (compressed natural gas)

A $0.13 per gallon tax is imposed on CNG used for operating motor vehicles on public highways. For the purpose of determining the tax on CNG, a gallon equivalent factor of 5.66 pounds per gallon is used. A CNG vehicle user must apply for and obtain a CNG user's permit from the Tennessee Department of Revenue. Government agencies are exempt from this tax. (Reference Tennessee Code 67-3-1113 and 67-3-1114)

Tax (liquified gas)

A use tax of $0.14 per gallon is imposed on liquefied gas used for operating motor vehicles on public highways in addition to a pre-paid annual vehicle tax according to the following:Maximum Gross Vehicle Weight Rating TaxPassenger Car $70Non-Passenger Cars Up to 16,000 pounds (lbs.) $8416,000 to 26,000 lbs. $100Over 26,000 lbs. $114Government agencies are exempt from the liquefied gas use tax. Liquefied gas is all combustible gas that exists in the gaseous state at 60 degrees Fahrenheit and at a pressure of 14.7 pounds per square inch, but does not include gasoline, diesel fuel, or compressed natural gas. Additional restrictions may apply. (Reference Tennessee Code 67-3-1101, 67-3-1102, 67-3-1103, and 67-3-1106)

Traffic Exemption (HOV lane)

Vehicles that the U.S. Environmental Protection Agency defines as Inherently Low Emission Vehicles or Low Emission and Energy-Efficient Vehicles and have gross vehicle weight ratings of 26,000 pounds or less are permitted use of HOV lanes regardless of the number of occupants. Such vehicles must display a Tennessee Department of Revenue decal. (Reference Tennessee Code 55-8-188)