To repeal certain barriers to domestic fuel production, and for other purposes.

Summary: American Alternative Fuels Act of 2011 - Amends the Energy Independence and Security Act of 2007 to repeal the requirement that any federal agency procurement contract for an alternative or synthetic fuel, including those from nonconventional petroleum sources, for any mobility-related use (except research or testing) specify that lifecycle greenhouse gas emissions associated with the fuel must, on an ongoing basis, be less than or equal to such emissions from equivalent conventional fuel produced from conventional petroleum sources.

Amends the Energy Policy Act of 2005 to: (1) require the Secretary of Energy to report to certain congressional committees the reasons for any delayed approval of an application for a loan guarantee for a substitute natural gas, chemical feedstock, or liquid transportation fuel project; and (2) make certain substitute natural gas production facilities eligible for loan guarantees.

Amends the Clean Air Act to require the Administrator of the Environmental Protection Agency (EPA), as an algae-based fuel incentive when calculating the applicable volume of renewable fuel for each calendar year, to consider each gallon of renewable biomass produced from algae to be equal to three gallons of renewable fuel if the algae-based fuel was produced using carbon dioxide captured in a manner that prevented its uncontrolled release into the atmosphere during a separate energy production process.

Authorizes the Secretary of Defense (DOD), the Secretary of the Army, the Secretary of the Navy, the Secretary of the Air Force, the Secretary of Homeland Security (DHS), and the Administrator of the National Aeronautics and Space Administration (NASA) to enter into multiyear procurement contracts for alternative fuels, subject to certain requirements.

Amends the Clean Air Act to direct the permitting authority, when establishing the best available control technology for a major emitting facility that is an electric generating facility located in a region in which demand for electricity has increased significantly due to the volume of electric vehicles, to take into account the extent to which emissions of a pollutant have been reduced as a result of the increased use of such vehicles.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``American Alternative Fuels Act of 
2011''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) the United States needs short- and long-term policies 
        designed--
                    (A) to eliminate the reliance of the United States 
                on foreign energy sources;
                    (B) to create jobs in the United States; and
                    (C) to harness all of the energy resources of the 
                United States;
            (2) promoting the energy security of the United States can 
        be achieved by leveraging all domestic energy resources, 
        including--
                    (A) traditional fossil fuels;
                    (B) alternative energy resources; and
                    (C) renewable energy; and
            (3) the United States needs to adopt policies that would 
        foster a more sustainable domestic energy supply that would--
                    (A) decrease risks to national security;
                    (B) lower domestic energy prices;
                    (C) reduce trade deficits; and
                    (D) create jobs in the United States.

SEC. 3. REPEAL OF UNNECESSARY BARRIERS TO DOMESTIC FUEL PRODUCTION.

    (a) In General.--Section 526 of the Energy Independence and 
Security Act of 2007 (42 U.S.C. 17142) is repealed.
    (b) Conforming Amendment.--Section 1112 of the National Aeronautics 
and Space Administration Authorization Act of 2008 (42 U.S.C. 17827) is 
repealed.

SEC. 4. TRANSPARENCY FOR DELAYED LOAN GUARANTEE APPLICATIONS.

    Section 1702 of the Energy Policy Act of 2005 (42 U.S.C. 16512) is 
amended by adding at the end the following:
    ``(l) Reporting Requirement.--
            ``(1) In general.--If the Secretary fails to make a final 
        decision by the date that is 270 days after the date on which 
        the Secretary selects an application to proceed to negotiations 
        of terms and conditions for issuance of a conditional 
        commitment for a loan guarantee application under this title 
        for a substitute natural gas, chemical feedstock, or liquid 
        transportation fuel project, not later than 7 days after that 
        date, and for every 90-day period thereafter, the Secretary 
        shall--
                    ``(A) prepare a status report for the period 
                covered by the report; and
                    ``(B) submit the status report to--
                            ``(i) the Committee on Energy and Natural 
                        Resources of the Senate; and
                            ``(ii) the Committee on Energy and Commerce 
                        of the House of Representatives.
            ``(2) Contents.--The status report described in paragraph 
        (1) shall contain--
                    ``(A) a description of each reason for the delay of 
                the application;
                    ``(B) the name and office of the official who, for 
                the period covering the status report, has reviewed the 
                application; and
                    ``(C) a detailed schedule for completion of the 
                application review.''.

SEC. 5. ALGAE-BASED FUEL INCENTIVES.

    Section 211(o)(2)(B) of the Clean Air Act (42 U.S.C. 7545(o)(2)(B)) 
is amended by adding at the end the following:
                            ``(vi) Algae-based fuel incentives.--For 
                        purposes of calculating the applicable volume 
                        of renewable fuel under clauses (i) and (ii) 
                        for each calendar year, the Administrator shall 
                        consider each gallon of renewable biomass 
                        produced from algae to be equal to 3 gallons of 
                        renewable fuel if the algae-based fuel was 
                        produced using carbon dioxide that was captured 
                        in a manner that prevented the uncontrolled 
                        release of carbon dioxide into the atmosphere 
                        during a separate energy production process.''.

SEC. 6. LOAN GUARANTEES.

    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) Substitute natural gas production facilities, if the 
        gas is produced--
                    ``(A) from a solid feedstock through a gasification 
                process; and
                    ``(B) in a manner that captures at least 90 percent 
                of the carbon produced through the gasification 
                process.''.

SEC. 7. MULTIYEAR CONTRACT AUTHORITY FOR DEPARTMENT OF DEFENSE FOR 
              PROCUREMENT OF ALTERNATIVE FUELS.

    (a) Multiyear Contracts for the Procurement of Alternative Fuels 
Authorized.--
            (1) In general.--Chapter 141 of title 10, United States 
        Code, is amended by adding at the end the following:

``SEC. 2410R. MULTIYEAR CONTRACT AUTHORITY: PURCHASE OF ALTERNATIVE 
              FUELS.

    ``(a) In General.--The head of an agency (as defined in section 
2302) may enter into contracts for a period not to exceed 20 years for 
the purchase of alternative fuels.
    ``(b) Required Provisions.--A contract entered into under 
subsection (a) shall include the following provisions:
            ``(1) A statement that the obligation of the United States 
        to make payments under the contract in any fiscal year is 
        subject to appropriations being provided specifically for that 
        fiscal year and specifically for alternative fuels.
            ``(2) A commitment to obligate the necessary amount for 
        each fiscal year covered by the contract when and to the extent 
        that funds are appropriated for that purpose for that fiscal 
        year.
            ``(3) A statement that a commitment given under the 
        authority of this section does not constitute an obligation of 
        the United States.''.
            (2) Clerical amendment.--The table of sections of chapter 
        141 of title 10, United States Code, is amended by adding at 
        the end the following:

``2410r. Multiyear contract authority: purchase of alternative 
                            fuels.''.
    (b) Regulations.--Not later than 120 days after the date of 
enactment of this Act, the Secretary of Defense shall issue regulations 
providing that the head of an agency may enter into a multiyear 
contract as authorized by section 2410r of title 10, United States Code 
(as added by subsection (a)), only if the head of the agency has 
determined in writing that--
            (1) there is a reasonable expectation that, throughout the 
        contemplated contract period, the head of the agency will 
        request funding for the contract at the level required to avoid 
        contract cancellation;
            (2) the technical risks associated with the technologies 
        for the production of alternative fuel under the contract are 
        not excessive;
            (3) the contract will contain appropriate pricing 
        mechanisms to minimize risk to the Federal Government from 
        significant changes in market prices for energy; and
            (4) the contract will not be used by the Department of 
        Defense to finance new facilities intended to produce fuel for 
        consumption by the Federal Government.
    (c) Limitation on Use of Authority.--No contract may be entered 
into under section 2410r of title 10, United States Code (as so added), 
until the regulations required by subsection (b) are issued.

SEC. 8. ELECTRIC VEHICLE IMPACT ON ELECTRICITY DEMAND.

    Section 169(3) of the Clean Air Act (42 U.S.C. 7479(3)) is 
amended--
            (1) by striking ``(3) The term'' and inserting the 
        following:
            ``(3) Best available control technology.--
                    ``(A) Definition.--
                            ``(i) In general.--The term'';
            (2) in the second sentence, by striking ``In no event'' and 
        inserting the following:
                    ``(B) Emission limitations.--
                            ``(i) In general.--In no event'';
            (3) in the third sentence, by striking ``Emissions'' and 
        inserting the following:
                            ``(ii) Prohibition on certain increases.--
                        Emissions''; and
            (4) by adding at the end the following:
                    ``(C) Additional considerations.--For purposes of 
                establishing the `best available control technology' 
                for a major emitting facility that is an electric 
                generating facility located in a region in which demand 
                for electricity has increased significantly due to the 
                volume of electric vehicles, the permitting authority 
                shall take into account the extent to which the 
                emissions of a pollutant have been reduced as a result 
                of the increased use of electric vehicles.''.