In July 2021, on-road diesel fuel prices in the US averaged $3.31 per gallon, an increase of ¢89 from the year before. Taxes account for 18% of that price, amounting to about ¢60 per gallon. So, if you buy 100 gallons of on-road diesel at its current price, about $60 of your bill would be for tax alone.
The good news is that not all engines need pricey on-road diesel; some can use cheaper off-road diesel.
Having said that, we created this guide comparing off-road diesel vs. on-road diesel. Read on to discover the difference between the two, the laws that govern their use, and where you can use them.
Off-Road Diesel vs. On-Road Diesel: The Key Legal Differences
Off-road diesel is diesel fuel specifically designed for use in non-road vehicles. However, it’s also sometimes used as a heating fuel in traditional homes. Either way, it’s exempt from federal or state excise taxes, which is why it’s cheaper than on-road diesel.
For the same reasons, it’s against the law to use off-road diesel in vehicles used on public roads.
By contrast, on-road diesel is diesel fuel used in motor vehicles operated on public roads. For example, it’s the type of diesel you use on a diesel-powered pick-up truck you drive around town.
What Is Off-Road Diesel and On-Road Diesel Made Of?
Off-road and on-road diesel both consist of diesel fuel, which is the refined version of crude oil. That makes their base chemical structure similar.
All types of diesel sold in the US for on-road and off-road engines must now be ultra-low sulfur diesel (ULSD). That means their sulfur content should not exceed 15 parts per million (ppm). However, be aware that some types of diesel, such as low sulfur diesel (LSD), have a higher sulfur content than ULSD.
The main reason for the use of ULSD is to control vehicular emissions. That’s because sulfur creates sulfur oxides (SOx), sulfate (SO4), and particulate matter (PM). All these are common air pollutants; therefore, it’s imperative to reduce them.
Sulfur dioxide (SO2), the most concerning type of SOx, has harmful respiratory effects. Even at low doses, SO2 can cause breathing difficulties and chest tightness. It also raises the risk of hospitalizations and ER visits in high-risk groups.
SOx in the atmosphere also transforms into SO4, a type of fine particulate matter. All forms of PM, be it fine (PM2.5) or coarse (PM10), can have adverse health effects. PM2.5 is more dangerous, though, as it can penetrate the lungs and even the blood.
How Then Can You Distinguish Off-Road vs. On-Road Diesel?
Conventional taxed diesel, the kind you use for on-road vehicles, is clear or has a slight yellow tinge. The diesel pumps you can find in most typical gas stations carry on-road diesel.
By contrast, off-road diesel comes with a red dye. That’s why many folks also refer to off-road diesel as red diesel or dyed diesel.
Since dyed diesel is only for non-road equipment, not all gas stations carry this type of fuel. Only a few establishments have a separate pump specifically for tax-exempt diesel. Because of this, most people who use red diesel rely on off road diesel delivery services for their needs.
Which Machines Can You Use Off-Road Diesel For?
You can use off-road diesel for most non-road diesel-powered heavy equipment. These include residential and commercial generators, heavy construction machines, and farm equipment.
Bulldozers, cranes, excavators, front loaders, and tractors are examples of diesel construction machines. Farm equipment, such as balers, cultivators, planters, and sprayers, also use red diesel.
What Happens If You Use Dyed Diesel in a Passenger Vehicle?
Since off-road diesel is just a dyed version of on-road diesel, it won’t hurt the engine of a passenger vehicle.
However, you shouldn’t use red diesel in an on-road vehicle as it’s illegal under federal and state laws. In fact, the Internal Revenue Service (IRS) penalizes those who break this law with hefty fines. Each violation can lead to a fine of $1,000 or $10 per gallon; offenders will pay whatever is higher.
Moreover, lawbreakers must pay the taxes they should’ve otherwise paid for on-road diesel. On top of these penalties are those imposed by individual state governments.
Can You Buy Off-Road Diesel The Way You Purchase On-Road Diesel?
In most cases, no, as states require dyed diesel consumers to have some form of identification.
An example is the California Air Resources Board (CARB) Off-Road Diesel Regulation. This mandates the reporting of all applicable vehicles or equipment to CARB. It also requires labeling of the vehicles reported for off-road diesel use.
In Texas, only a buyer with an End User Number can purchase red diesel. To get this number, one must apply with the Texas comptroller first. Buyers also need to present a signed statement each time they purchase red diesel.
Are There Any Exceptions to Dyed Diesel Rules?
Yes, some exceptions apply to emergency uses of off-road diesel. For example, governments lift the red diesel ban in cases of natural disasters, such as storms. Such events can disrupt fuel supplies, so on-road diesel fuel may become unavailable.
In such situations, you can use off-road diesel in your passenger or highway vehicles. You can also use dyed diesel to heat an on-road vehicle during these emergencies.
Always Use the Legal Type of Diesel Fuel
There you have it, your guide to distinguishing off-road diesel vs. on-road diesel. Just keep in mind that off-road diesel is only for non-road vehicles and equipment. Unless the US or your area is in a state of emergency, it’s illegal to use dyed diesel in an on-road vehicle.
For the same reasons, always stick to taxed diesel when filling up your pick-up truck’s tank.
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