Volkswagen Environmental Mitigation Trust Grant Program

The Volkswagen Environmental Mitigation Trust Eligible Mitigation Actions program is administered by the Vermont Department of Environmental Conservation within the Agency of Natural Resources. This program originates from Vermont’s allocation of the national Volkswagen Environmental Mitigation Trust, established to offset excess nitrogen oxide emissions resulting from violations of federal emissions standards. Since 2017, the State has been responsible for distributing these funds to projects that reduce harmful emissions and support the transition to cleaner technologies. The program reflects Vermont’s broader environmental goals of improving air quality, reducing greenhouse gas emissions, and accelerating adoption of zero emission transportation solutions. The primary purpose of this funding opportunity is to support projects that replace or repower existing diesel powered vehicles, engines, and equipment with all electric alternatives. Eligible projects must demonstrate measurable reductions in nitrogen oxide emissions and contribute to the feasibility and adoption of electric technologies in heavy duty and nonroad applications. The program focuses on sectors such as freight transportation, public transit, school buses, airport ground support equipment, marine vessels, and industrial equipment like forklifts. Projects must involve either full replacement with new electric units or repowering of existing equipment using electric systems. Funding is available for a wide range of project costs directly associated with electrification, including vehicle or equipment purchase, installation of charging infrastructure, and certain related construction and installation expenses. However, the program prohibits use of funds for fleet expansion, general administrative costs, real estate acquisition, or unrelated capital improvements. All replaced diesel equipment must be permanently disabled through a formal scrappage process, ensuring that emissions reductions are permanent. Additional requirements include maintaining the new equipment in Vermont operations for at least five years and complying with ongoing reporting obligations. Eligibility for the program is broad and inclusive. Federal, state, and regional government entities, municipalities, institutions, and private businesses are all eligible, provided their vehicles or equipment operate primarily within Vermont. Government owned entities may receive up to 85 percent of project costs, while private entities may receive up to 75 percent, creating a mandatory cost share requirement. Applicants must also demonstrate ownership and operational use of the equipment being replaced and provide documentation such as mileage logs and equipment records. The application process is conducted on a rolling monthly basis beginning July 1, 2026 and continuing through December 31, 2026 or until funds are fully allocated. Applications must be submitted electronically via email and include several required components, such as a completed application form, fleet description worksheet, commitment documentation, and supporting operational records. Optional justification materials are required for certain project elements like fast charging infrastructure. Applications are reviewed monthly, and applicants are typically notified within five business days following the end of the submission month. Evaluation of applications is based on a structured scoring system that prioritizes project quality, emissions reduction cost effectiveness, completeness of fleet data, degree of in state use, and long term sustainability measures such as idling reduction policies. The program also considers resilience factors, including vulnerability of project sites to climate impacts. Selected projects must complete work by June 30, 2028, with possible extensions granted on a case by case basis. For assistance or inquiries, applicants may contact the program administrator via email or phone. Monthly applicant conferences are offered to provide guidance, though participation is not required. Overall, this funding opportunity represents a significant investment in Vermont’s transition to clean transportation and infrastructure, with a strong emphasis on measurable environmental outcomes and long term operational accountability.

Emphasize cost effectiveness of emissions reductions provide detailed fleet data ensure high percentage of Vermont use and demonstrate strong project planning and sustainability measures including idling reduction policies