Statewide Vehicle Incentive Programs

The Vermont Legislature has authorized five statewide vehicle incentive programs for income-qualified Vermonters: 1) an incentive program for the purchase or lease of new plug-in electric vehicles (PEVs), 2) a high-fuel-efficiency used-vehicle incentive program called MileageSmart  3) an emissions-system repair program, 4) Replace Your Ride, to encourage cleaner alternatives to high-polluting vehicles, and 5) an incentive program for the purchase of an electric bike (e-bike). These programs are described in greater detail below.

AOT Announces Notice of Funding Opportunity (NOFO) for Vermont Clean Transportation Incentive Program Administration (September 27, 2021)

For more information, please visit here: Contracts for Services | Agency of Transportation (vermont.gov)

For those interested in the emissions-system repair program, please visit the Department of Environmental Conservation’s page here.

In addition, the Legislature has authorized funding for EVSE (EV chargers) for affordable multi-unit developments. For those interested in this program, please visit the Department of Housing and Community Development’s page here

Incentive Program for New PEVs

Drive Electric Vermont, on behalf of VTrans, administers the statewide incentive program for new PEVs on a first-come, first-served basis. Incentives are available for income-qualified individuals, with greater incentives available for those with lower incomes and for those who purchase all-electric vehicles (AEVs):

Electric Vehicle Income Eligibility Table

Incentives are limited to PEVs with a base MSRP of $40,000 or less. Check with Drive Electric Vermont for 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 electric utility that serves their household.

It is not necessary to be a utility customer to participate in the program. Incentives are limited to one per person per year, as determined by a minimum 12-month lapsed time from a prior state EV incentive, 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 website at: https://www.driveelectricvt.com/why-go-electric/purchase-incentives.

High Fuel-Efficiency Used-Vehicle Program (MileageSmart)

The high fuel-efficiency used-vehicle program provides point-of-sale financial assistance to income-eligible Vermonters to purchase used fuel-efficient vehicles. MileageSmart can contribute up to 25% toward the purchase of a used high-miles-per-gallon (MPG) vehicle by program participants. Additional information about MileageSmart, including how to apply, can be found at MileageSmart.com.

Programs Under Development

In the FY2022 transportation budget, the Legislature authorized three new vehicle incentive programs currently under development and expected to launch in early 2022.

Emissions Repair Program

This program will provide point of repair financial assistance to income-eligible Vermonters to help repair vehicles that have failed emissions testing. Please visit the Department of Environmental Conservation’s page for more details on eligibility and program requirements.

Replace Your Ride

Through the FY2022 Transportation bill, funding was approved for a new incentive program, “Replace Your Ride,” to encourage owners of older, higher polluting vehicles to switch to cleaner transportation options. Eligible applicants must either meet the lower-income thresholds of the PEV incentive program, or meet the criteria for the MileageSmart program (80% of Area Median Income, based on household size). It is envisioned that up to $3,000 in incentives will be available to participants who retire a high-polluting vehicle towards a purchase of either a used or new PEV; a bike, electric bike, or fully electric motorcycle; and/or shared mobility services which reduce the need for vehicle ownership. Incentives through this program may be applied in combination with others through the MileageSmart, PEV, and electric bike incentive programs. More details will be posted here when the Replace Your Ride program becomes operational in the next few months.

Electric Bike Incentive

All Vermont residents currently eligible under the PEV incentive program guidelines (see above) will also be eligible on a first-come, first-served basis for a new $200 incentive towards the purchase of an electric bicycle.Incentives will be available for up to 250 recipients. More information can be found here when the E-Bike Incentive program becomes operational in the next few months.

Email Updates

If you would like to receive updated information about any of these new incentive programs directly, please submit an email address below.