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Green Driver State Incentives in South Dakota

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Currently, South Dakota doesn't offer too much in the way of green driver incentives; however, that doesn't mean eco-friendly drivers can't take advantage of a few green driving perks such as propane tax exemptions, federal tax incentives, and possible auto insurance discounts.

Of course, just as with green driving laws, green driver incentives are subject to change at any time. Be sure to keep up with this page as well as the Alternative Fuel Data Center (AFDC) and your local Motor Vehicle Division (MVD) office for the most up-to-date information.

South Dakota Vehicle Emissions Testing

South Dakota doesn't require smog checks for any vehicles, including electric vehicles and other alternative fuel vehicles (AFV) such as hybrids and diesel-fueled vehicles.

However, there are plenty of ways you can help cut back on vehicle emissions and keep the air clean.

For example, you might:

  • Carpool with friends and coworkers headed in the same direction.
  • Combine various trips into one drive.
  • Keep up with vehicle maintenance.

Learn more about smog checks and vehicle emissions at our section on South Dakota Vehicle Inspections.

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Propane Tax Exemption

You do not have to pay a state fuel excise tax on liquified petroleum gas (propane) if you purchase it from a licensed propane vendor as long as you are a licensed propane user or licensed propane vehicle owner AND the propane is delivered into a bulk storage tank for motor vehicle use.

Read up on the Liquid Petroleum Gas (LPG) Gas User information with the state's Motor Fuel Tax Manual and learn more about applying for your user license at the South Dakota Tax Application website.

Reference South Dakota Statutes 10-47B-167.

Federal Tax Credits for Green Vehicles

Because the federal government offers tax credits for purchasing the following vehicles, you might be eligible for a federal tax credit if you buy a:

  • Hybrid.
  • Plug-in hybrid (PHEV).
  • Electric vehicle. (EV).
  • Diesel-powered vehicle.
  • Alternative fuel vehicle (AFV).

Find out more by visiting the fueleconomy.gov Tax Center as well as talking to your preferred tax professional or your local Taxpayer Assistance Center.

Auto Insurance Discounts for Eco-Friendly Driving and Green Vehicles

Some car insurance providers offer coverage discounts for driving eco-friendly vehicles and even for having green driving habits.

Some of the most common green vehicle discounts include

  • Hybrid auto discounts. These types of vehicles run on both electricity and another type of fuel.
  • Electric vehicle discounts. Generally, electric vehicles run solely on electricity from plugging in or batteries.
  • Alternative fuel vehicle (AFV) discounts. Hybrids and AFVs aren't the only kind of alternative fuel vehicles. You might also get a discount for driving vehicles such as diesel-powered cars and trucks.
  • Economy car discounts. Typically, economy cars are lightweight, easy on the wallet, and don't use much gas.
  • Low-mileage discounts. These are discounts for having, and keeping, low mileage on your vehicle. These kinds of discounts might apply to a driver who works from home or only uses his vehicle to run occasional errands.

Again, these possible car insurance discounts vary by provider and circumstances. For example, your agency might offer a 10% or higher discount on car insurance for owning or leasing some sort of alternative fuel vehicle, or you might get up to 30% off your car insurance premium for maintaining low mileage on your vehicle.

Call your current car insurance agent and ask about these and other types of eco-friendly vehicle and green driving discounts. If your current provider doesn't offer any, consider comparing auto insurance rates online until you find the best rate for you and your green vehicle and/or driving habits.

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