A bill to promote coal-to-liquid fuel activities.

Summary: Coal-to-Liquid Fuel Energy Act of 2007 - Amends the Energy Policy Act of 2005 to include among the projects eligible for Department of Energy (DOE) loan guarantees large-scale coal-to-liquid facilities that use a feedstock, the majority of which is domestic coal resources, to produce at least 10,000 barrels a day of liquid transportation fuel.

Instructs the Secretary of Energy (Secretary) to make loans for use by recipients to pay the federal share of the cost of obtaining any services necessary for the planning, permitting, and construction of coal-to-liquid facilities.

Directs the Secretary to promulgate regulations to support the development of coal-to-liquid manufacturing facilities and associated infrastructure on DOE and other federal lands, including military bases and military installations closed or realigned under the defense base closure and realignment.

Amends the Energy Policy and Conservation Act to direct the Secretaries of Energy and of Defense to study and report to Congress on the feasibility and suitability of maintaining coal-to-liquid products in the Strategic Petroleum Reserve (Reserve).

Authorizes the Secretary to construct storage facilities in the vicinity of pipeline infrastructure and at least one military base.

Amends the Energy Policy and Conservation Act to authorize the Secretary to acquire, place in storage, transport, or exchange coal-to-liquid products in the Reserve.

Authorizes the use of certain funds by the Air Force Research Laboratory to continue support efforts to test, qualify, and procure synthetic fuels developed from coal for aviation jet use.

Amends federal law governing Armed Forces fuel procurement to authorize the Secretary of Defense to enter into agreements with private companies to develop and operate coal-to-liquid facilities on or near military installations.

Instructs the Secretary of Energy to implement a research and demonstration program to evaluate the emissions of the use of Fischer-Tropsch transportation fuel, including diesel and jet fuel.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Coal-to-Liquid Fuel Energy Act of 
2007''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Coal-to-liquid.--The term ``coal-to-liquid'' means--
                    (A) with respect to a process or technology, the 
                use of a feedstock, the majority of which is the coal 
                resources of the United States, using the class of 
                reactions known as Fischer-Tropsch, to produce 
                synthetic fuel suitable for transportation; and
                    (B) with respect to a facility, the portion of a 
                facility related to producing the inputs to the 
                Fischer-Tropsch process, the Fischer-Tropsch process, 
                finished fuel production, or the capture, 
                transportation, or sequestration of byproducts of the 
                use of a feedstock that is primarily domestic coal at 
                the Fischer-Tropsch facility, including carbon 
                emissions.
            (2) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.

SEC. 3. COAL-TO-LIQUID FUEL LOAN GUARANTEE PROGRAM.

    (a) Eligible Projects.--Section 1703(b) of the Energy Policy Act of 
2005 (42 U.S.C. 16513(b)) is amended by adding at the end the 
following:
            ``(11) Large-scale coal-to-liquid facilities (as defined in 
        section 2 of the Coal-to-Liquid Fuel Energy Act of 2007) that 
        use a feedstock, the majority of which is the coal resources of 
        the United States, to produce not less than 10,000 barrels a 
        day of liquid transportation fuel.''.
    (b) Authorization of Appropriations.--Section 1704 of the Energy 
Policy Act of 2005 (42 U.S.C. 16514) is amended by adding at the end 
the following:
    ``(c) Coal-to-Liquid Projects.--
            ``(1) In general.--There are authorized to be appropriated 
        such sums as are necessary to provide the cost of guarantees 
        for projects involving large-scale coal-to-liquid facilities 
        under section 1703(b)(11).
            ``(2) Alternative funding.--If no appropriations are made 
        available under paragraph (1), an eligible applicant may elect 
        to provide payment to the Secretary, to be delivered if and at 
        the time the application is approved, in the amount of the 
        estimated cost of the loan guarantee to the Federal Government, 
        as determined by the Secretary.
            ``(3) Limitations.--
                    ``(A) In general.--No loan guarantees shall be 
                provided under this title for projects described in 
                paragraph (1) after (as determined by the Secretary)--
                            ``(i) the tenth such loan guarantee is 
                        issued under this title; or
                            ``(ii) production capacity covered by such 
                        loan guarantees reaches 100,000 barrels per day 
                        of coal-to-liquid fuel.
                    ``(B) Individual projects.--
                            ``(i) In general.--A loan guarantee may be 
                        provided under this title for any large-scale 
                        coal-to-liquid facility described in paragraph 
                        (1) that produces no more than 20,000 barrels 
                        of coal-to-liquid fuel per day.
                            ``(ii) Non-federal funding requirement.--To 
                        be eligible for a loan guarantee under this 
                        title, a large-scale coal-to-liquid facility 
                        described in paragraph (1) that produces more 
                        than 20,000 barrels per day of coal-to-liquid 
                        fuel shall be eligible to receive a loan 
                        guarantee for the proportion of the cost of the 
                        facility that represents 20,000 barrels of 
                        coal-to-liquid fuel per day of production.
            ``(4) Requirements.--
                    ``(A) Guidelines.--Not later than 180 days after 
                the date of enactment of this subsection, the Secretary 
                shall publish guidelines for the coal-to-liquids loan 
                guarantee application process.
                    ``(B) Applications.--Not later than 1 year after 
                the date of enactment of this subsection, the Secretary 
                shall begin to accept applications for coal-to-liquid 
                loan guarantees under this subsection.
                    ``(C) Deadline.--Not later than 1 year from the 
                date of acceptance of an application under subparagraph 
                (B), the Secretary shall evaluate the application and 
                make final determinations under this subsection.
            ``(5) Reports to congress.--The Secretary shall submit to 
        the Committee on Energy and Natural Resources of the Senate and 
        the Committee on Energy and Commerce of the House of 
        Representatives a report describing the status of the program 
        under this subsection not later than each of--
                    ``(A) 180 days after the date of enactment of this 
                subsection;
                    ``(B) 1 year after the date of enactment of this 
                subsection; and
                    ``(C) the dates on which the Secretary approves the 
                first and fifth applications for coal-to-liquid loan 
                guarantees under this subsection.''.

SEC. 4. COAL-TO-LIQUID FACILITIES LOAN PROGRAM.

    (a) Definition of Eligible Recipient.--In this section, the term 
``eligible recipient'' means an individual, organization, or other 
entity that owns, operates, or plans to construct a coal-to-liquid 
facility that will produce at least 10,000 barrels per day of coal-to-
liquid fuel.
    (b) Establishment.--The Secretary shall establish a program under 
which the Secretary shall provide loans, in a total amount not to 
exceed $20,000,000, for use by eligible recipients to pay the Federal 
share of the cost of obtaining any services necessary for the planning, 
permitting, and construction of a coal-to-liquid facility.
    (c) Application.--To be eligible to receive a loan under subsection 
(b), the eligible recipient shall submit to the Secretary an 
application at such time, in such manner, and containing such 
information as the Secretary may require.
    (d) Non-Federal Match.--To be eligible to receive a loan under this 
section, an eligible recipient shall use non-Federal funds to provide a 
dollar-for-dollar match of the amount of the loan.
    (e) Repayment of Loan.--
            (1) In general.--To be eligible to receive a loan under 
        this section, an eligible recipient shall agree to repay the 
        original amount of the loan to the Secretary not later than 5 
        years after the date of the receipt of the loan.
            (2) Source of funds.--Repayment of a loan under paragraph 
        (1) may be made from any financing or assistance received for 
        the construction of a coal-to-liquid facility described in 
        subsection (a), including a loan guarantee provided under 
        section 1703(b)(11) of the Energy Policy Act of 2005 (42 U.S.C. 
        16513(b)(11)).
    (f) Requirements.--
            (1) Guidelines.--Not later than 180 days after the date of 
        enactment of this Act, the Secretary shall publish guidelines 
        for the coal-to-liquids loan application process.
            (2) Applications.--Not later than 1 year after the date of 
        enactment of this Act, the Secretary shall begin to accept 
        applications for coal-to-liquid loans under this section.
    (g) Reports to Congress.--Not later than each of 180 days and 1 
year after the date of enactment of this Act, the Secretary shall 
submit to the Committee on Energy and Natural Resources of the Senate 
and the Committee on Energy and Commerce of the House of 
Representatives a report describing the status of the program under 
this section.
    (h) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $200,000,000, to remain 
available until expended.

SEC. 5. LOCATION OF COAL-TO-LIQUID MANUFACTURING FACILITIES.

    The Secretary, in coordination with the head of any affected 
agency, shall promulgate such regulations as the Secretary determines 
to be necessary to support the development on Federal land (including 
land of the Department of Energy, military bases, and military 
installations closed or realigned under the defense base closure and 
realignment) of coal-to-liquid manufacturing facilities and associated 
infrastructure, including the capture, transportation, or sequestration 
of carbon dioxide.

SEC. 6. STRATEGIC PETROLEUM RESERVE.

    (a) Development, Operation, and Maintenance of Reserve.--Section 
159 of the Energy Policy and Conservation Act (42 U.S.C. 6239) is 
amended--
            (1) by redesignating subsections (f), (g), (j), (k), and 
        (l) as subsections (a), (b), (e), (f), and (g), respectively; 
        and
            (2) by inserting after subsection (b) (as redesignated by 
        paragraph (1)) the following:
    ``(c) Study of Maintaining Coal-to-Liquid Products in Reserve.--Not 
later than 1 year after the date of enactment of the Coal-to-Liquid 
Fuel Energy Act of 2007, the Secretary and the Secretary of Defense 
shall--
            ``(1) conduct a study of the feasibility and suitability of 
        maintaining coal-to-liquid products in the Reserve; and
            ``(2) submit to the Committee on Energy and Natural 
        Resources and the Committee on Armed Services of the Senate and 
        the Committee on Energy and Commerce and the Committee on Armed 
        Services of the House of Representatives a report describing 
        the results of the study.
    ``(d) Construction of Storage Facilities.--As soon as practicable 
after the date of enactment of the Coal-to-Liquid Fuel Energy Act of 
2007, the Secretary may construct 1 or more storage facilities in the 
vicinity of pipeline infrastructure and at least 1 military base.''.
    (b) Petroleum Products for Storage in Reserve.--Section 160 of the 
Energy Policy and Conservation Act (42 U.S.C. 6240) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1), by inserting a semicolon at 
                the end;
                    (B) in paragraph (2), by striking ``and'' at the 
                end;
                    (C) in paragraph (3), by striking the period at the 
                end and inserting ``; and''; and
                    (D) by adding at the end the following:
            ``(4) coal-to-liquid products (as defined in section 2 of 
        the Coal-to-Liquid Fuel Energy Act of 2007), as the Secretary 
        determines to be appropriate, in a quantity not to exceed 20 
        percent of the total quantity of petroleum and petroleum 
        products in the Reserve.'';
            (2) in subsection (b), by redesignating paragraphs (3) 
        through (5) as paragraphs (2) through (4), respectively; and
            (3) by redesignating subsections (f) and (h) as subsections 
        (d) and (e), respectively.
    (c) Conforming Amendments.--Section 167 of the Energy Policy and 
Conservation Act (42 U.S.C. 6247) is amended--
            (1) in subsection (b)--
                    (A) by redesignating paragraphs (2) and (3) as 
                paragraphs (1) and (2), respectively; and
                    (B) in paragraph (2) (as redesignated by 
                subparagraph (A)), by striking ``section 160(f)'' and 
                inserting ``section 160(e)''; and
            (2) in subsection (d), in the matter preceding paragraph 
        (1), by striking ``section 160(f)'' and inserting ``section 
        160(e)''.

SEC. 7. AUTHORIZATION TO CONDUCT RESEARCH, DEVELOPMENT, TESTING, AND 
              EVALUATION OF ASSURED DOMESTIC FUELS.

    Of the amount authorized to be appropriated for the Air Force for 
research, development, testing, and evaluation, $10,000,000 may be made 
available for the Air Force Research Laboratory to continue support 
efforts to test, qualify, and procure synthetic fuels developed from 
coal for aviation jet use.

SEC. 8. COAL-TO-LIQUID LONG-TERM FUEL PROCUREMENT AND DEPARTMENT OF 
              DEFENSE DEVELOPMENT.

    Section 2398a of title 10, United States Code is amended--
            (1) in subsection (b)--
                    (A) by striking ``The Secretary'' and inserting the 
                following:
            ``(1) In general.--The Secretary''; and
                    (B) by adding at the end the following:
            ``(2) Coal-to-liquid production facilities.--
                    ``(A) In general.--The Secretary of Defense may 
                enter into contracts or other agreements with private 
                companies or other entities to develop and operate 
                coal-to-liquid facilities (as defined in section 2 of 
                the Coal-to-Liquid Fuel Energy Act of 2007) on or near 
                military installations.
                    ``(B) Considerations.--In entering into contracts 
                and other agreements under subparagraph (A), the 
                Secretary shall consider land availability, testing 
                opportunities, and proximity to raw materials.'';
            (2) in subsection (d)--
                    (A) by striking ``Subject to applicable provisions 
                of law, any'' and inserting ``Any''; and
                    (B) by striking ``1 or more years'' and inserting 
                ``up to 25 years''; and
            (3) by adding at the end the following:
    ``(f) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as are necessary to carry out this section.''.

SEC. 9. REPORT ON EMISSIONS OF FISCHER-TROPSCH PRODUCTS USED AS 
              TRANSPORTATION FUELS.

    (a) In General.--In cooperation with the Administrator of the 
Environmental Protection Agency, the Secretary of Defense, the 
Administrator of the Federal Aviation Administration, and the Secretary 
of Health and Human Services, the Secretary shall--
            (1) carry out a research and demonstration program to 
        evaluate the emissions of the use of Fischer-Tropsch fuel for 
        transportation, including diesel and jet fuel;
            (2) evaluate the effect of using Fischer-Tropsch 
        transportation fuel on land and air engine exhaust emissions; 
        and
            (3) in accordance with subsection (e), submit to Congress a 
        report on the effect on air quality and public health of using 
        Fischer-Tropsch fuel in the transportation sector.
    (b) Guidance and Technical Support.--The Secretary shall issue any 
guidance or technical support documents necessary to facilitate the 
effective use of Fischer-Tropsch fuel and blends under this section.
    (c) Facilities.--For the purpose of evaluating the emissions of 
Fischer-Tropsch transportation fuels, the Secretary shall--
            (1) support the use and capital modification of existing 
        facilities and the construction of new facilities at the 
        research centers designated in section 417 of the Energy Policy 
        Act of 2005 (42 U.S.C. 15977); and
            (2) engage those research centers in the evaluation and 
        preparation of the report required under subsection (a)(3).
    (d) Requirements.--The program described in subsection (a)(1) shall 
consider--
            (1) the use of neat (100 percent) Fischer-Tropsch fuel and 
        blends of Fischer-Tropsch fuels with conventional crude oil-
        derived fuel for heavy-duty and light-duty diesel engines and 
        the aviation sector; and
            (2) the production costs associated with domestic 
        production of those fuels and prices for consumers.
    (e) Reports.--The Secretary shall submit to the Committee on Energy 
and Natural Resources of the Senate and the Committee on Energy and 
Commerce of the House of Representatives--
            (1) not later than 180 days after the date of enactment of 
        this Act, an interim report on actions taken to carry out this 
        section; and
            (2) not later than 1 year after the date of enactment of 
        this Act, a final report on actions taken to carry out this 
        section.
    (f) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as are necessary to carry out this section.