CNG incentives may get axed in Oklahoma

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Updated Apr 10, 2016

Compressed Natural Gas (CNG) supporters in Oklahoma are concerned about possible cuts to state tax incentives which have spurred some of the biggest CNG gains in the nation.

Faced with an estimated $1.3 billion shortfall, the Oklahoma Senate has introduced a bill to cut incentives for CNG fueling stations and natural gas vehicles (NGVs). Low oil prices are being blamed for a drop in tax revenue for the state, according to

NGV America, an NGV trade group, has released an open letter to the state in which NGVAmerica President Matthew Godlewski says that the CNG incentives have saved NGV drivers about $85 million and, if left alone for the next four years, could result in additional $55 million in savings.

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The state stands to benefit too, according to Godlewski, who says that the tax credits have generated about $18 million in related tax revenue since their adoption in 2009.

Godlewski casts Oklahoma as a leader in the CNG industry with more CNG stations per capita than any other state in the nation.

Tax incentives passed from 2009-2011 have led to a 79 percent increase in CNG stations across The Sooner State. Godlewski says the surge is owed to a tax credit covering up to 75 percent of the cost associated with acquiring CNG infrastructure, including CNG stations.

Another tax credit covers up to 45 percent of the cost of a CNG equipped vehicle. The state operates roughly 900 CNG vehicles. Other government entities, including cities, use hundreds of more vehicles equipped with the alternative fuel.

State Senate Bill 977 proposes that the tax credits be suspended from June 1 through July 30, 2018.