Fleets: Arkansas fleets can tap into CNG rebate program

Fleet managers in Arkansas can use money in a $2.2 million Arkansas Energy Office fund to purchase and/or convert their Arkansas-licensed vehicles to compressed natural gas (CNG).

The funding for the Compressed Natural Gas Conversion Rebate Program comes from the federal American Recovery and Reinvestment Act (ARRA). The program will be administered by the Arkansas Energy Office (AEO), which is a division of the Arkansas Economic Development Commission (AEDC).

Fleets that are eligible can be in public entities such as cities, counties and school districts. Private fleets that have at least 10 vehicles are also eligible. A minimum of four vehicles in the fleet must be converted. Eligible vehicles are light vehicles, medium and heavy-duty vehicles, traditional mass transit buses and school buses.

Rebates are available on a first-come, first-served basis until December 2011 or until funds are depleted, whichever comes first, said Joe Holmes, AEDC marketing and communications director. “Since announcing the program last Friday, we have had a lot of calls from local governments and companies with private fleets that have expressed interest,” Holmes told Govpro.com. “Certainly we expect local governments that meet the fleet criteria to participate, but we can’t predict how many.”

Through the program, rebates of 50 percent of the conversion cost or the incremental cost of purchasing new CNG vehicles would be given directly to fleet operators following the conversion to, or purchase of, CNG vehicles. Rebate amounts depend on the cost of conversion or incremental cost of a CNG vehicle, but rebates cannot exceed $25,000. To ensure rebates are available for multiple fleets, no single entity may receive more than 20 percent of the CNG rebate fund.

CNG conversion kits must be installed according to National Fire Protection Association standards and be certified by the Environmental Protection Agency (EPA) and must comply with EPA requirements for vehicle conversions.

In announcing the rebate program, Arkansas Governor Mike Beebe said: “One of the hurdles to increasing the use of alternative fuels is building or converting infrastructure to make these fuels economically feasible. This program will encourage use of less-expensive American fuel that helps Arkansas’s economy. Making compressed natural gas a more viable option for vehicle fleets can also reduce our dependence on foreign oil.”

More information and applications are available from the Arkansas Energy Office or by calling 1-800-558-2633. The CNG Conversion Rebate Program is supported by the U.S. Department of Energy and the Arkansas Economic Development Commission – Arkansas Energy Office.

In addition to the $2.2 million in ARRA rebate funds, the AEO is also dedicating $470,000 toward the development of at least two CNG refueling stations to further develop CNG infrastructure in the state. The $470,000 will be provided through $400,000 in remaining Oil Overcharge Funds and $70,000 provided from Senate General Improvement Funds. The AEO will partner with public and private entities on the installation of the two stations and is currently accepting applications based on factors such as overall impact, leveraged funds, energy and emissions reductions, and job creation.