HB23-1272: Tax Policy That Advances Decarbonization

• Electric Vehicle & Truck Credits: Extends and increases tax credits for purchasing or leasing electric vehicles (up to $5,000) and establishes new credits for electric medium- and heavy-duty trucks (up to $12,000), with credits assignable to dealers/lenders at point of sale starting January 2024.

• Clean Energy Technology Credits: Creates new tax credits for industrial facilities implementing greenhouse gas emissions reduction improvements (up to $5 million), geothermal energy projects (up to 50% of costs), heat pump installations ($500-$3,000 depending on type), electric bicycles ($500 per sale), and sustainable aviation fuel production facilities (12-30% of construction costs).

• Oil & Gas Severance Tax Credit Reduction: Temporarily reduces the severance tax credit for oil and gas production from 87.5% to 75-76.5% for tax years 2024-2027, with revenue generated directed to fund decarbonization tax credit administration.

• Specific Ownership Tax Reduction: Provides temporary 50% tax rate reduction on electric medium- and heavy-duty trucks that are part of a fleet from 2024-2033.

• Administration & Implementation: Creates new cash funds and requires Colorado Energy Office to develop standards for credit eligibility; appropriates $149,729 for 2023-24 fiscal year to administer the programs.