Transportation has a major impact on our society and environment, contributing 70% of U.S petroleum use, 28% of U.S. greenhouse gas (GHG) emissions, over 34,000 fatalities and 2.2 million injuries in 2013. Punitive approaches to used to tackle environmental issues in the transportation sector, such as congestion pricing have been well documented, although the use of incentives or rewards lags behind in comparison. In addition to the use of more fuel-efficient, alternate energy vehicles and various other energy reduction strategies; energy consumption can be lowered through incentivizing alternative modes of transportation. This paper focused on modifying travelers’ behavior by providing rewards to enable shifts to more energy-efficient modes, (e.g., from auto to either bus or bicycles). Optimization conditions are formulated for the problem to understand solution properties, and numerical tests are carried out to study the effects of system parameters (e.g., token budget and coefficient of tokens) on the optimal solutions (i.e., energy savings). The multinomial logit model is used to formulate the full problem, comprised of an objective function and constraint of a token budget ranging from $5,000-$10,000. Comparably, the full problem is computationally reduced by various parameterization strategies, in that the number of tokens assigned to all travelers’ is parameterized and proportional to the expected energy savings. An optimization solution algorithm is applied with a global and local solver to solve a lagrangian sub-problem and a duo of heuristic solution algorithms of the original problem. These were determined necessary to attain an optimal and feasible solution. Input data necessary for this analysis is obtained for the Town of Amherst, MA from the Pioneer Valley Planning Commission (PVPC). The results demonstrated strong evidence to conclude a positive correlation between the system’s energy savings and the aforementioned system parameters. The local and global solvers solution algorithm reduced the average energy consumption by 11.48% - 19.91% and12.79% – 21.09% consecutively for the identified token budget range from a base case scenario with no tokens assigned. The duo of lagrangian heuristic algorithms improved the full problems solution i.e., higher energy savings, when optimized over a local solver, while the parameterized problem formulations resulted in higher energy savings when compared to the full problems’ formulation solution over local solver, but higher energy savings compared over the global solver. The Computational run-time for the global and local solvers solution algorithm for the full problem formulation required 43 hours and 24 minutes consecutively, while the local solver for the lagrangian heuristics and parameterized problem solution algorithm took 13 minutes and 7 minutes consecutively. Future research on this paper will be comprised of a bi-level optimization problem formulation where a high level optimization aims at maximizing system-wide energy savings, while a low-level consumer surplus maximization problem is solved for each system user.