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Clean Transportation Incentives

An Electric Vehicle Charging station

Climate smart transportation incentive programs help income-qualified Vermonters reduce their transportation related emissions. VTrans works with partners including Drive Electric Vermont and Capstone Community Action to offer programs that replace internal combustion vehicles on the road with new or used efficient and electric vehicle, bicycles, or other clean transportation options. Find out which incentive opportunity might be right for you by exploring the climate smart transportation programs authorized by the Legislature. 

The Vermont Legislature has authorized four statewide vehicle incentive programs for income-qualified Vermonters, plus an incentive for fleets: 

  1. an incentive program for the purchase or lease of a new plug-in electric vehicle (PEV);
  2. an incentive program for the purchase of a high fuel-efficiency used vehicle called MileageSmart;
  3. an incentive program that retires 10+ year old internal combustion engine vehicles and provides funds for cleaner transportation alternatives called Replace Your Ride; 
  4. an incentive program for the purchase of a new electric bicycle (eBike);
  5. an incentive program to encourage the electrification of business, nonprofit, and municipal fleets called Electrify Your Fleet.

These programs are described in greater detail below.

In addition, the Legislature has also authorized funding for EVSE (EV chargers) for affordable multi-unit developments and other community charging applications. For those interested in these programs, please visit the Department of Housing and Community Development website.

Incentive Program for New Plug-in Electric Vehicles (PEVs)

Incentives are available for the purchase or lease of a new plug-in electric vehicle (PEV). Incentives are available on a first-come, first-served basis for income-qualified individuals, with greater incentives available for those with lower incomes and for those who purchase all-electric vehicles (AEVs).

Incentives are limited to plug-in electric vehicles (PEVs) with a base MSRP of $52,500 or less. Exceptions to the vehicle price caps are now available for those requiring an accessible vehicle. Please consult the updated list of eligible vehicles. The statewide incentive may be used in combination with additional PEV incentives offered by the state’s electric utilities and federal tax credits for greater savings.

Under the statewide incentive program for new PEVs, eligible customers may receive the incentive directly from a participating car dealer in the form of a reduced purchase or lease price, or they may receive a direct cash reimbursement from the state's incentive administrator, Center for Sustainable Energy.

It is not necessary to be a utility customer to participate in the program. Incentives are limited to one per person, and to Vermont residents only. Incentives are not available retroactively for purchases or leases made prior to the program launch or for purchases or leases made when funds have been exhausted and new funding is not yet available.

For more information including remaining funds, eligible models, application forms, and a current list of participating auto dealerships, please visit the Drive Electric Vermont website.

High Fuel-Efficiency Used Vehicle Program (MileageSmart)

The high fuel-efficiency used vehicle program provides financial assistance to income-eligible Vermonters at the point-of-sale to purchase used fuel-efficient vehicles. MileageSmart can contribute up to 25% of the vehicle purchase price, with a maximum of $5,000. Additional information about MileageSmart, including how to apply, can be found at the MileageSmart website,

Replace Your Ride

The Replace Your Ride program encourages owners of older internal combustion engine vehicles to switch to cleaner transportation options by offering an incentive of up to $5,000 to scrap the high polluting vehicle.  

The program offers two options on how to use the incentive:  

  1. Participants may apply their voucher towards the purchase or lease of a new or used PEV;
  2. Participants seeking a more flexible option may apply their voucher towards active or shared mobility options including the purchase of either a used or new PEV; a bicycle, electric bicycle, or fully electric motorcycle; and/or shared mobility services that reduce the need for vehicle ownership (such as public transit fares, carsharing or bikesharing). Participants who chose the latter option will receive a clean mobility card, which is a pre-paid debit card that can be used at eligible businesses that help reduce or avoid vehicle miles traveled in single occupancy automobiles. 

Incentives through this program may be applied in combination with others through the MileageSmart, New PEV, and electric bicycle incentive programs. More information about the Replace Your Ride program is available at the Drive Electric Vermont website.

Electric Bike Incentive

The State of Vermont launched the nation’s first statewide incentive program to help Vermonters make daily trips with cleaner transportation that helps reduce greenhouse gas emissions. 

Electric Bicycle (eBike) incentive funding has been fully distributed as of April 2024.

Electrify Your Fleet Program

Electrify Your Fleet is an electric vehicle incentive program for businesses, municipalities, and nonprofit organizations to reduce the climate impacts from fleet vehicles. The program will help fleet owners fund the replacement of their internal combustion engine (ICE) vehicles with cleaner electric transportation options such as Plug-In Electric Vehicles (PEVs), electric motorcycles, electric bikes, or electric snowmobiles.  

Electrify Your Fleet is a first-come, first-served grant program with awards made in the form of reimbursements of as much as $2,500 for each internal combustion engine vehicle replaced or avoided with a maximum of 20 incentives allowed per fleet.      

Find a link to the Notice of Funding Opportunity (NOFO), online application, and additional resources on the Electrify Your Fleet Program webpage


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