Off-road diesel, or red-dyed diesel, is used by companies and individuals with vehicles that do not operate on public roadways. Businesses can use off-road diesel to provide fuel for heat, power marine vessels, and operate portable or fixed power generators and other equipment.
On-road and off-road diesel do not have a chemical difference between them. The only way to tell the difference between on-road and off-road diesel fuel is the color. On-road diesel has no dye and is often called clear diesel. It has a natural soft amber coloration.
What Are the Benefits of Off-Road Diesel?
The expense of fuels can be high for some industries. To offset that expense, vehicles and equipment that use diesel fuel qualify for incentives that significantly reduce fuel costs.
Using off-road diesel fuel offers specific benefits:
- Tax incentives and rebates make off-road diesel a cost-effective fuel choice.
- Job-site delivery promotes bulk fuel availability.
- No chemical differences exist between off-road and on-road diesel.
In addition to cost benefits, which average savings of 25 to 50 cents per gallon, off-road diesel fuel also creates time savings. Using programs such as job-site fueling, keeping your fuel tanks full can reduce equipment downtime. Employees also spend less time accomplishing fueling tasks and more time using the equipment.
Qualifying for Off-Road Diesel Use
While off-road diesel is subject to being taxed, the taxes are much lower when compared to on-road diesel taxes. Additionally, off-road diesel is exempt from some regulations and fees, which helps lower the cost.
Federal regulations and state-level regulations exist for off-road diesel. For example, in Texas, you must file both IRS Form 4136 for federal rebates and the Texas AP-197 (Texas Dyed Diesel Fuel End User Signed Statement Number Registration).
Both on-road and off-road diesel must be Ultra Low Sulfur Diesel (ULSD) and contain no more than 15 ppm sulfur content.
Penalties for Using Off-Road Diesel Illegally
You may be tempted to fill a noncommercial vehicle with off-road diesel, but here’s why you should refrain from doing it. While you would initially save a few dollars on the cost, unauthorized off-road diesel fueling could result in fines and possible criminal charges for tax evasion.
Using field test kits, government investigators can detect even minute amounts of dye. These individuals often appear at weighing stations, safety checkpoints, agricultural shows, and truck stops.
Fines can range from $100 to more than $1,000 for one gallon. Taxes and penalties can multiply the cost, and you could also lose your employment.
When Off-Road Diesel Is Your Only Option
During a declared state of emergency, using off-road diesel to fuel vehicles for transportation on public roads may be legal. These events might include occurrences of severe weather or other disasters that disrupt regular fuel supplies. These emergency declarations will vary from state to state.
If you have additional questions about off-road diesel, contact Reeder Distributors, Inc. Use our online contact form or call us toll-free at 800-722-3103. Our knowledgeable staff can help answer any questions you have about off-road diesel.