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Texas brings back eco-friendly car incentives

June 4, 2018

Texas may be the biggest pickup truck market in the country, but the Lone Star State wants its roads to be a little greener in the future.

After staying out of the eco-car rebate for the last three years, Texas will reinstate incentives beginning Sept. 1 as high as $5,000 on alternative fuel vehicles—electric cars, plug-in hybrids, hydrogen fuel-cell vehicles, and those that run on natural gas or liquefied petroleum gas (LPG).

While electric, plug-in hybrid, and hydrogen fuel-cell vehicles can claim $2,500 in rebates, cars and trucks that run on natural gas and LPG are eligible for $5,000 each. The rebates don't apply to fleet purchases. Given that natural gas- and LPG-fueled vehicles aren't marketed toward consumers, it's safe to bet the vast majority of rebates will be used for electric and plug-in hybrid cars like the Chevrolet Bolt EV and Toyota Prius Prime.

Another big caveat: the rebates are doled out by dealerships, which means that they don't apply to Tesla's electric cars. Texas is one of many states that requires new cars to be sold through franchised dealers, rather than directly from an automaker, and Tesla uses a workaround to sell cars through another state to buyers in Texas.

The state's legislature set aside $7.3 million after approving the program last year and tasked the Texas Commission on Environmental Quality with doling out the incentives.

The incentives plan is essentially a reboot of a similar program that ended in 2015, reported The Dallas Morning News last week.

Texas' plan applies to both purchased and leased vehicles and it runs through May 31, 2019 unless the commission's rebate budget runs out first.

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