VW Funding of Propane Buses

Applications for School Bus replacement are now available
from the Kentucky Energy and Environment Cabinet

The General Assembly approved an allocation of $8.5 Million for new clean energy school buses to replace aging vehicles.

The funds will be dispersed through a grant program administered by the Energy and Environmental Cabinet.  A district may apply for replacement grants for up to five (5) eligible buses in daily use.  Buses purchased under the grant program will be eligible for standard KDE depreciation on the total purchase price.

(Eligible buses currently in daily service and built with a chassis year of 2001 or earlier.)

Time Line:
  • September 9-October 9, 2020:  Applications Accepted
  • November 1, 2020: Districts notified of approval amounts
  • No later than June 30, 2020: Rebate funds dispersed to Districts

Instructions and application for VW Settlement school bus funding can be found below; applications must be returned to ky.vwsettlement@ky.gov by close of business Oct. 9, 2020.

Read the School Bus Application Instructions closely. 

Below are some suggested templates and links to required information for completing the application. 
These templates have not been reviewed or approved by the Cabinet but may provide guidance.

Section 1:  Detailed Description of Mitigation Action Item Including Comunity and Air Quality Benefits

Template answer suggestion: XXXXX Schools will utilize the Kentucky School Bus Replacement Application to remove from service a pre-2001 diesel bus from service and replace it with a low-emission propane school bus.  The dramatic reduction in NOx emissions will improve air quality and provide health benefits for school students and staff.  Studies have shown that students score better when transported on propane buses rather than diesel buses.  The community will receive health benefits from the reduction in pollutants and particulate matter generated by our older bus(es), especially for our children and citizens vulnerable to airborne pollutants.

The application must contain an estimate of the expected lifetime NOx emissions reduction for each proposed School Bus replacement, calculated using the Argonne National Laboratory Heavy-Duty Vehicle Emissions Calculator.  Use link below.  Print out result to include with application.

Section 2: If your district is located in a county designated as nonattainment or maintenance for the federal ozone or PM2.5 ambient air quality standards, describe how the replacement of the bus(es) will decrease the emissions that impact the area or, if your district is located in a county designated by the Appalachian Regional Commission as a distressed county, note it here.  If the buses you are replacing typically operate in areas with a high incidence of childhood asthma or breathing problems - explain how the replacement of the bus(es) will help the situation.


Template answer suggestion: XXXX Schools is/is not included in a county designated as nonattainment or maintenance for the federal ozone or PM2.5 ambient air quality standards.  XXX schools is/is not included in the list of ARC designated list of distressed counties.  Scientific studies have repeatedly shown that diesel fumes and particulates have a negative impact on the developing lungs of children.  These fumes and particulates are particularly detrimental to children and adults that suffer from breathing conditions, including childhood asthma.  Replacement of a diesel bus with one powered by propane will dramatically reduce both NOx and Particulate emissions.

Section 3:  Identification of School Buses to be replaced and certification that they are in daily use.

Secton 4:  Certification that you understand that the replaced school bus must be scrapped and cannot be resold as an operating vehicle.  More information on the scrapping process is expected soon.

Section 5.  Identification of replacement buses.  Understand that the replacement bus must be of the same type and seating capacity as the bus to be removed from service.  Contact the EEC with questions.

Section 6.  Certification that you undestand that grant amounts may be reduced proportionately, depending on the number of approved grant applications.  (Still a great opportunity not to be missed)

Section 7.  Explanation of how a "back up" bus may be eligible for replacement under the grant program.

Section 8.  Sign application and submit with attachments via email to:  KY.VWSettlement@ky.gov


KY PERC will be posting updated information regularly to this page in order to make the application process as smooth as possible.



Contact our office at 502-223-5322 or info@choosepropane.org for any assistance.

To Find Your Closest Propane Marketer for Your Fuel Supply, Click the Button Below

Or contact the KY Propane Education & Research Council for Assistance.

Information on the Federal VW Settlement

On October 26, 2016 the federal courts approved a settlement with VW over the diesel emissions scandal.  VW will establish and fund a $2.7 Billion environmental mitigation trust.

Kentucky will receive a pool of over $20 Million to lower the maximum amount of  NOx pollution at the most efficient cost by removing older diesels from the roads of the Commonwealth.  Propane buses emit 85% less NOx that the targeted diesel buses and have lower fuel and maintenance costs than new diesel buses. 

These funds will be received by the Commonwealth in late 2017.  The grant program will be operated by the Kentucky Division of Air Quality. 

Sign up HERE to receive updates and notifications on the progress of the grant program development and when applications are open.


Click The Link Below for More Information on the Settlement Requirements