Transportation fuels are a major component of Colorado’s energy portfolio accounting for nearly 27 percent of all energy use, one of the largest energy sectors in the state. Colorado is in a position to become a key producer and beneficiary in the emerging alternative-fuels economy. The state has abundant resources that have great potential as domestic sources for transportation fuels. Diversifying the state’s portfolio of transportation fuels is a key priority for the Colorado Energy Office as it seeks to promote its mission of enhancing energy security, promoting environmental stewardship, creating Colorado jobs, and providing low costs to consumers.
Sales of alternative fuel vehicles in Colorado have grown at a rapid pace in recent years. As of 2016, Colorado has more than 85,508 alternative fuel vehicles, including biodiesel, flex-fuel, hybrid, electric, natural gas and propane vehicles. Although this remains a relatively small share of Colorado’s 5.8 million registered vehicles, market shares are growing rapidly, particularly for natural gas and electric vehicles. From 2015 to 2016, compressed natural gas sales grew from 5.8 million to 8.2 million gasoline gallon equivalents. Electric vehicle sales have grown rapidly as well, from 20 of the vehicles on Colorado roads in 2011 to 8,138 by the end of 2016. Recent market studies conducted by the Colorado Energy Office forecast that the percentage of natural gas vehicle sales could reach 15 percent of heavy-duty sales by 2025, and the number of electric vehicles in Colorado could grow to 937,798 by 2030.
Two of the largest barriers remaining to alternative fuel vehicles are the initial vehicle cost and a lack of fueling or charging infrastructure. To address vehicle cost, Colorado offers among the largest tax incentives and grants for local governments. In addition, the Colorado Energy Office has launched two programs to deploy infrastructure: ALT Fuels Colorado and Charge Ahead Colorado. More information about these programs can be found below.