Operators of LPG-powered lift trucks may not be getting all they can from their propane, either because they’re missing out on a tax credit or because they’re using a poor grade of fuel.

The U.S. government is offering a 50 cent-per-gallon tax credit for users of alternative fuels, but most lift truck owners appear to not be taking advantage of the credit.

“Propane is such a standard fuel in lift trucks, people forget it’s an alternative fuel,” says Brian Feehan, managing director of the Propane Education & Research Council. “It decreases our dependence on foreign oil because 90% of our supply is derived from the U.S.”

The fuel use credit went into effect in October 2006 and runs through September 2009. The credit was originally intended for on-road vehicles but was eventually extended to off-road vehicles such as lift trucks.

Propane users can register to claim the credit by filing IRS Form 637. Once you’re approved, the IRS will issue a 637 number with “AL” at the end, indicating IRS authorization to file as an alternative fueler.

And if you’re using propane in your lift trucks, be sure you’re using the right grade, says Audie Burgan, president of JM Equipment, a Nissan and Jungheinrich dealer in Fresno, Calif.

HD5 is the grade of propane intended for internal combustion engine vehicles. It contains a minimum of 90% pure propane and a maximum of 5% propylene. The top lift truck suppliers recommend this grade for use in their products.

Burgan notes, however, that California has a big population of agricultural users who buy heating oil propane and tend to use it in their lift trucks, too.

“We’ve had a heck of a time keeping their units running because the injectors were gumming up and the high heat these units were producing internally was breaking down the characteristics of propane,” he says. “The customers thought it was a problem with the lift trucks. The manufacturers said it’s because of dirty fuel.”