California implements LNG measurement and rates

According to a special notice from the State Board of Equalization, California has introduced new CNG and LNG measurement and rates.

The recent assembly bill has added rules to existing Use Fuel Tax Laws requiring CNG, sold at retail to the public for use as a motor vehicle fuel, to be sold in a gasoline gallon equivalent that is equal to 126.67 ft³, or 5.66 pounds.

Additionally, the bill requires that LNG be sold in a diesel gallon equivalent equal to 6.06 pounds.

Use Fuel Tax Rate

Beginning 1 January 2015, the new requirement adjusts the tax rate for CNG to 8.87 cents for each 126.67 ft³ or 5.66 pounds of CNG used, measured at the standard pressure and temperature (14.73 pounds PSI at 60° Fahrenheit). The new requirement also adjusts the tax rate for LNG to 10.17 cents for each 6.06 pounds of LNG used.

Rules for vendors

For those who make retail sales of CNG and/or LNG, the rules advise that vendors must begin collecting the adjusted tax rate on 1 January 2015. Additionally, vendors must place a label on the CNG dispensing apparatus in a conspicuous place indicating, ‘Gasoline gallon equivalent’. For retail sales of LNG, retailers must place a label on the dispensing apparatus in a conspicuous place indicating, ‘Diesel gallon equivalent’.

Sales of LNG and/or CNG to users who have paid the annual flat rate tax, are not subject to the use fuel tax, provided the vehicle has a current flat rate decal attached.

Adapted from press release by Katie Woodward

Read the article online at: https://www.lngindustry.com/small-scale-lng/07112014/california-lng-rates-change-1750/