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Task force: Offer tax credits, convert fleets to natural gas

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Increasing tax credits and transitioning the state vehicles to use natural gas and propane are among recommendations issued Feb. 21 by the Governor's Natural Gas Vehicle Task Force.

"We have the opportunity to reinvest in our own economy, provide drivers with lower costs at the pump as well as support the establishment of more good-paying jobs for West Virginians — all by using a clean burning energy source harvested right here at home," said Gov. Earl Ray Tomblin on receiving the report.

Tomblin established the 21-member board of public and private industry experts in June 2012 to come up with recommendations for increasing the use of the state's growing natural gas production as a transportation fuel.

The task force identified a chicken-and-egg problem inherent in transitioning to any new fuel.

"Infrastructure developers want to see demand by numerous vehicles needing the fuel, but the would-be purchasers of the vehicles require the infrastructure in place first," the report reads.

Other challenges, are identified as well, including the need to tax natural gas as a motor fuel in the same way that gasoline is taxed in order to maintain the state Department of Transportation road fund.

Among the task force's 16 recommendations:

  • Priority consideration for infrastructure development should be in counties with greatest vehicle fleet concentrations: Berkeley, Cabell, Fayette, Greenbrier, Harrison, Jefferson, Kanawha, Logan, Marion, Mercer, Monongalia, Ohio, Putnam, Raleigh, Wayne and Wood counties.
  • Private retailers can afford to develop infrastructure where there are high populations, willing partners requiring fuel, access to natural gas and level sites with constant flows of traffic.
  • To convert state fleets, state agencies should be directed to assess opportunities to transition segments of their fleets to natural gas vehicles and develop eight-year implementation plans. A target rate of conversion could be one quarter of the state's fleet, or nearly 2,000 vehicles, within four years.
  • The state should add bi-fuel vehicles to the fleet to balance supply and demand during the transition.
  • The Department of Education's definition of alternative fuels for school buses should add propane and compressed natural gas.
  • The community and technical college system can help by preparing natural gas vehicle-trained technicians.
  • Tax incentives on compressed natural gas, liquefied natural gas or propane vehicles should be continued for private sector purchases.
  • A commercial alternative fuel vehicle infrastructure tax credit of 20 percent up to $400,000 should be offered.
  • Excise taxes on natural gas used in motor vehicles should be imposed on the basis of energy content, or gasoline gallon equivalents, to help maintain the road fund.

The task force also recommended that a transition team be formed to monitor technology and economic issues and make further recommendations.