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Tax incentives and/or other rebates, credits, incentives or related initiaves for drivers of alternative fuel vehicles or for other uses of alternative fuel in Texas.
The Texas Commission on Environmental Quality (TCEQ) administers the Emissions Reduction Incentive Grants (ERIG) Program and Rebate Grants Program as part of the Texas Emissions Reduction Plan (TERP). The ERIG Program provides grants for various types of clean air projects to improve air quality in the state's nonattainment areas and other affected counties. Eligible projects include those that involve replacement, retrofit, repower, or lease or purchase of new heavy-duty vehicles; alternative fuel dispensing infrastructure; idle reduction and electrification infrastructure; and alternative fuel use. The Rebate Grants Program provides grants to upgrade or replace diesel heavy-duty vehicles and non-road equipment. Qualifying projects must reduce emissions of nitrogen oxides or other pollutants by at least 25% as compared to baseline levels and must meet operational and fuel usage requirements. Applications are currently not being accepted (verified September 2018). For more information, including eligibility and the application form, see the TCEQ TERP website. (Reference Texas Statutes Health and Safety Code 386 and Texas Administrative Code 114.620-114.629)
The Texas Gas Service Conservation Program offers a rebate of up to $2,000 for the purchase of a qualified NGV or $3,000 for the conversion of a gasoline powered vehicle to operate on natural gas. The rebate is available for up to five vehicles per customer, and only centers certified by the Railroad Commission of Texas may perform conversions. A rebate of $1,000 is also available for the purchase of a natural gas forklift. Additionally, qualified residential and commercial NGV fueling infrastructure may be eligible for a rebate of up to $2,000. These incentives are available to commercial and residential customers within the city limits of Austin, Bee Cave, Lakeway, Sunset Valley, Rollingwood, West Lake Hills, Cedar Park, and Kyle with specific gas rate codes. As of September 1, the rebate is also available for customers in the Rio Grande Valley service territory. For more information, see the Texas Gas Service Rebate Program website.
NEVs are defined as vehicles that can attain a maximum speed of 35 miles per hour (mph) and that must comply with the safety standards in Title 49 of the U.S. Code of Federal Regulations, section 571.500. NEVs may only be used on roadways that have a posted speed limit of 45 mph or less except to cross at an intersection. A county, municipality, or the Texas Department of Transportation may prohibit the operation of NEVs on a street or highway if the governing body determines that the prohibition is necessary in the interest of safety. (Reference Texas Statutes, Transportation Code 551.301-551.304)
The Texas Commission on Environmental Quality administers the AirCheckTexas Drive a Clean Machine program, which provides vehicle replacement assistance for qualified individuals owning vehicles registered in participating counties. Vouchers in the amount of $3,500 are available toward the purchase of a hybrid electric, battery electric, or natural gas vehicle that is up to three model years old. For more information about participating counties, qualified vehicles, program requirements, and how to apply in specific areas, see the AirCheckTexas Drive a Clean Machine website. (Reference Texas Statutes, Health and Safety Code 382.209-382.220)
Plug-in electric vehicle owners in the Austin Energy service area may be eligible for a rebate of 50% of the cost to purchase and install a qualified Level 2 EVSE, up to $1,200. For additional information, see the Austin Energy Home Charging website.
To pass the state vehicle inspection, an NGV owner must be able to provide proof that the fuel tank on the vehicle has met inspection requirements and falls within the manufacturer's recommended service life, as required by Title 49 of the U.S. Code of Federal Regulations, section 571.304. Fleet operators must also prove that a certified technician inspected the vehicle's fuel tank. (Reference Texas Statutes, Transportation Code 548.104)
Compressed natural gas (CNG) and liquefied natural gas (LNG) dispensed into a motor vehicle is taxed at a rate of $0.15 per gasoline gallon equivalent (GGE) or diesel gallon equivalent (DGE), depending on how the dispenser lists the price. A GGE is defined as 5.66 pounds (lbs.) of CNG or 5.37 lbs. of LNG. A DGE is defined as 6.38 lbs. of CNG or 6.06 lbs. of LNG. Exemptions may apply. (Reference Texas Statutes, Tax Code 162.001, and 162.351-162.356)
Any school district or charter school may receive a grant through the Texas Commission on Environmental Quality (TCEQ) to pay for the incremental costs to replace school buses or install diesel oxidation catalysts, diesel particulate filters, emission-reducing add-on equipment, and other emissions reduction technologies in qualified school buses. Furthermore, funds may also be used to purchase qualifying fuels, including any liquid or gaseous fuel or additive registered or verified by the U.S. Environmental Protection Agency (other than standard gasoline or diesel) that provides particulate matter emission reductions. Additional rules and conditions apply. For more information, see the TCEQ Texas Emissions Reduction Plan website. The program is not currently accepting applications (verified September 2018). (Reference Texas Statutes, Health and Safety Code 390, and Texas Administrative Code 114.640-114.648)
Propane vehicle incentives are available to private, non-profit, local government, state, and school white fleets. New dedicated propane vehicles and aftermarket conversions are eligible for an incentive equal to the incremental cost, up to $7,500. Each fleet is limited to $20,000 in total incentive awards.
Additionally, a $1,000 incentive is available for each new or converted propane commercial mower operated by public and private entities (excluding state agencies). Mower applicants are limited to seven incentive awards.
All conversion systems for vehicles and mowers must be certified through the U.S. Environmental Protection Agency or the California Air Resources Board. All vehicles and mowers must be registered and operated in Texas. Additional terms and conditions apply. For more information, see the Propane Council of Texas website.
The Texas Commission on Environmental Quality (TCEQ) administers the Light-Duty Motor Vehicle Purchase or Lease Incentive Program for the purchase or lease of a new light-duty vehicle powered by compressed natural gas (CNG), propane, hydrogen, or electricity. CNG and propane vehicles, including bi-fuel vehicles, are eligible for a rebate of $5,000 for the first 1,000 applicants. Electric drive vehicles powered by a battery or hydrogen fuel cell, including plug-in hybrid electric vehicles with a battery capacity of at least 4 kilowatt hours, are eligible for a rebate of $2,500, for the first 2,000 applicants. One rebate is available per eligible vehicle. Applications must be submitted by May 31, 2019. For more information, including eligibility requirements and the application form, see the TCEQ Texas Emissions Reduction Plan website. (Reference Texas Statutes Health and Safety Code 386 and Texas Administrative Code 114.610-114.613)