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HB23-1272 saves Coloradans money with approximately $60 million in annual tax credits and incentives for businesses and consumers for decarbonization investments
DENVER, CO – The House today passed legislation on a preliminary vote to save Coloradans and businesses money by expanding tax incentives for clean transportation, heat pumps, geothermal energy, and industrial emissions reductions.
HB23-1272 is part of a package of legislation that will incentivize the advancement and adoption of clean energy technologies and build upon federal initiatives to save Coloradan’s money, create good-paying jobs and help the state meet its climate goals.
“This bill will significantly lower energy costs for families, save consumers money on electric vehicles, and help Colorado meet our climate goals and improve our air quality,” said Rep. Mike Weissman, D-Aurora. “From e-bikes to heat pumps, we’re committed to increasing access to affordable clean energy sources to power our economy and save Coloradans money. Reducing carbon emissions will take time, but with smart investments and strong clean technology adoption, we can move Colorado forward, reduce costs for consumers and protect our environment.”
“I’m proud that with this legislation, Colorado will lead the way by lowering the cost of clean energy technologies in our homes, businesses and across the state,” said Rep. Junie Joseph, D-Boulder. “This bill saves consumers money on clean technology and will attract new businesses and jobs to Colorado while improving our air quality and protecting our Colorado way of life. Soon, consumers and businesses will see increased tax credits that will save them money on heat pumps, electric vehicles and energy efficiency upgrades.”
Tax Incentives to Advance Decarbonization: HB23-1272 would work to reduce the costs of adopting clean energy technologies for residents and businesses across Colorado through tax incentives. This includes incentives for investments in geothermal electricity development and high-efficiency heat pumps, and for measures to reduce industrial pollution. It would also extend and expand tax credits for electric trucks and passenger vehicles and provide discounts on electric bikes to help increase uptake of cleaner transportation methods. Specifically, this bill builds upon the federal incentives available through the Inflation Reduction Act and the Infrastructure Investment and Job Acts to help Colorado maximize the impact of federal dollars.
Tax incentives in HB23-1272 are expected to average $60 million each year with individual elements ramping up or down over time depending on available technologies and economic conditions. The bill:
Extends and expands the innovative motor vehicle tax credits and creates an additional $2,500 credit for certain electric passenger vehicles.
Continues the innovative truck tax credit for electric and plug-in hybrid electric trucks, with the credit ranging between $5,000 and $10,000 depending on the truck’s weight starting in 2024.
Creates a $500 refundable income tax credit for bicycle retailers for the sale of qualifying e-bikes so that retailers can offer immediate price reductions to purchasers..
Designs a refundable income tax credit for the installation of heat pump technology in residential and nonresidential buildings. The credits will vary based on the type and use of the heat pump.
Establishes the refundable industrial clean energy tax credit to implement greenhouse gas emissions reductions at qualifying large facilities that can be hard to decarbonize.
Creates the refundable sustainable aviation fuel (SAF) production facility tax credit worth up to $1-3 million annually for the costs of constructing a SAF production facility.