Gov Signs Natural Gas Incentive Bills

Gov. Gary Herbert on Thursday ceremonially signed two bills designed to help clean up Utah’s air.

HB406, sponsored by Rep. Steve Handy and championed in the Senate by Sen. Todd Weiler, provides incentives for trucking companies to purchase heavy-duty trucks that run on natural gas instead of gasoline or diesel. 

SB15, also sponsored by Handy, makes it easier to receive incentives to convert light vehicles to natural gas.

At the bill signing ceremony at Questar’s West Valley City natural gas fueling station, Herbert noted that Utah is taking many steps to clean up its air, and providing incentives for truckers and auto owners to use natural gas as a transportation fuel is an important strategy.

He said the success of the legislation is an example of all stakeholders coming together to solve a problem.

Handy and other speakers at the event noted that Utah has abundant natural gas, and it makes sense economically and environmentally to use it as a transportation fuel. Some 50 percent of air pollution comes from vehicle tailpipes, Handy said. 

Erik Johnson, representing BluLNG, said natural gas is being used as an engine fuel in many industries, including for big trucks, oil rigs, ships, locomotives, and mining equipment. Innovation can significantly reduce the cost of using natural gas as a fuel, he said.

Jerry Moyes, CEO of Swift, a major trucking company, said a semi-truck with a natural gas engine costs up to $50,000 more than a diesel truck, so the state incentives are important to encourage the industry to buy natural gas trucks.

HB 406 Establishes a tax credit for the purchase of new commercial category 7-8 vehicles (semi-trucks, garbage trucks, etc.), registered in Utah, and that drive 51% of their miles in the State. The amount of the tax credit starts at $25,000, and decreases to zero after calendar year 2020.

In the transportation industry, the heavy-duty work-truck segment drives the most miles, operates the biggest vehicles, and burns the most fuel. Medium- and heavy-duty trucks comprise only 4 percent of the total vehicles on the road, but account for 20 percent of the fuel consumed and 20 percent of the greenhouse gases emitted by the transportation sector.

Industry leaders say converting big-truck fleets to natural gas will improve the environment and unlock the economic and environmental benefits of Utah’s natural gas boom.

A poll, conducted by Dan Jones & Associates, found that 72 percent of Utahns support an incentive program to encourage conversion of large-truck fleets to natural gas.