To provide for research, development, and demonstration on coal and related technologies, and for other purposes.

Summary: Coal Energy Research, Development, and Demonstration Act of 2003 - Instructs the Secretary of Energy to: (1) perform an assessment that identifies cost and performance goals of technologies permitting continued cost-competitive use of coal for electricity generation, as chemical feedstocks, and as transportation fuel in 2007, 2015, and the years after 2020; and (2) implement a technology research, development, and demonstration program to facilitate production and generation of coal-based power through methods and equipment under specified Federal law.Prescribes technical criteria for a clean coal power initiative under which the Secretary shall fund coal energy generation projects that advance efficiency, environmental performance, and cost competitiveness well beyond the level of technologies that on a full scale are in operation or have been demonstrated to date.Instructs the Secretary to award competitive, merit-based grants to universities for the establishment of Centers of Excellence for Energy Systems of the Future.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Coal Energy Research, Development, 
and Demonstration Act of 2003''.

SEC. 2. DEFINITIONS.

    For purposes of this Act:
            (1) Cost and performance goals.--The term ``cost and 
        performance goals'' means the cost and performance goals 
        established under section 101(a).
            (2) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.

                 TITLE I--COAL RESEARCH AND DEVELOPMENT

SEC. 101. COAL AND RELATED TECHNOLOGIES PROGRAMS.

    (a) Establishment of Cost and Performance Goals.--
            (1) In general.--The Secretary shall perform an assessment 
        that identifies cost and performance goals, for achievement in 
        2007, 2015, and the years after 2020, for technologies that 
        would permit the continued cost-competitive use of coal for 
        electricity generation, as chemical feedstocks, and as 
        transportation fuel.
            (2) Consultation.--In establishing the cost and performance 
        goals under this subsection, the Secretary shall--
                    (A) consider activities and studies undertaken by 
                industry in cooperation with the Department of Energy 
                in support of the assessment performed under paragraph 
                (1); and
                    (B) consult with interested entities, including 
                coal producers, industries using coal, organizations to 
                promote coal and advanced coal technologies, 
                environmental organizations, and organizations 
                representing workers.
            (3) Timing.--The Secretary shall--
                    (A) not later than 120 days after the date of 
                enactment of this Act, issue a set of draft cost and 
                performance goals for public comment; and
                    (B) not later than 180 days after the date of 
                enactment of this Act, after taking into consideration 
                any public comments received, transmit to Congress the 
                final cost and performance goals.
    (b) Study.--
            (1) In general.--Not later than 1 year after the date of 
        enactment of this Act, and once every 2 years thereafter 
        through 2016, the Secretary, in cooperation with other 
        appropriate Federal agencies, shall conduct and transmit to the 
        Congress a study to--
                    (A) identify technologies that, by themselves or in 
                combination with other technologies, may be capable of 
                achieving the cost and performance goals;
                    (B) assess the costs that would be incurred by, and 
                the period of time that would be required for, the 
                development and demonstration of technologies that, by 
                themselves or in combination with other technologies, 
                contribute to the achievement of the cost and 
                performance goals;
                    (C) develop recommendations for technology 
                development programs, which the Department of Energy 
                could carry out in cooperation with industry, to 
                develop and demonstrate technologies that, by 
                themselves or in combination with other technologies, 
                achieve the cost and performance goals; and
                    (D) develop recommendations for additional 
                authorities required to achieve the cost and 
                performance goals and review and recommend changes, if 
                any, to those cost and performance goals if the 
                Secretary determines that such changes are necessary as 
                a result of ongoing research, development, and 
                demonstration of technologies.
            (2) Expert advice.--In carrying out this subsection, the 
        Secretary shall give due weight to the expert advice of 
representatives of the entities described in subsection (a)(2)(B).

SEC. 102. PRODUCTION AND GENERATION OF COAL-BASED POWER.

    (a) In General.--The Secretary shall carry out a technology 
research, development, and demonstration program to facilitate 
production and generation of coal-based power through methods and 
equipment under--
            (1) this title;
            (2) the Federal Nonnuclear Energy Research and Development 
        Act of 1974 (42 U.S.C. 5901 et seq.);
            (3) the Energy Reorganization Act of 1974 (42 U.S.C. 5801 
        et seq.); and
            (4) title XVI of the Energy Policy Act of 1992 (42 U.S.C. 
        13381 et seq.).
    (b) Conditions.--The program described in subsection (a) shall be 
designed to achieve the cost and performance goals.

SEC. 103. AUTHORIZATION OF APPROPRIATIONS.

    (a) In General.--There are authorized to be appropriated to the 
Secretary $200,000,000 for fiscal year 2005, $210,000,000 for fiscal 
year 2006, and $220,500,000 for fiscal year 2007, to remain available 
until expended, for carrying out the program under section 102, which 
may include--
            (1) innovations for existing plants;
            (2) integrated gasification combined cycle;
            (3) advanced combustion systems;
            (4) turbines for synthesis gas derived from coal;
            (5) carbon capture and sequestration research and 
        development;
            (6) coal-derived transportation fuels and chemicals;
            (7) solid fuels and feedstocks;
            (8) advanced coal-related research; and
            (9) advanced separation technologies.
    (b) Limit on Use of Funds.--The Secretary shall not use funds 
appropriated under this section until 30 days after the Secretary has 
transmitted to the Congress a report describing the proposed use of 
such funds and containing a plan that includes--
            (1) a detailed description of how proposals, if any, will 
        be solicited and evaluated, including a list of all activities 
        expected to be undertaken;
            (2) a detailed list of technical milestones for each coal 
        and related technology that will be pursued; and
            (3) a description of how the programs for which such funds 
        are authorized will be carried out so as to complement and not 
        duplicate activities authorized under the Clean Coal Power 
        Initiative authorized under title II.

                 TITLE II--CLEAN COAL POWER INITIATIVE

SEC. 201. PROJECT CRITERIA.

    (a) In General.--The Secretary shall provide funding under this 
title for coal energy generation projects that advance efficiency, 
environmental performance, and cost competitiveness well beyond the 
level of technologies that on a full scale are in operation or have 
been demonstrated as of the date of enactment of this Act.
    (b) Technical Criteria for Clean Coal Power Initiative.--
            (1) Gasification.--
                    (A) Technologies.--In allocating the funds made 
                available under section 204(a), the Secretary shall 
                ensure that up to 80 percent of the funds are used for 
                coal-based gasification technologies, including 
                gasification combined cycle, gasification fuel cells, 
                gasification coproduction, and hybrid gasification/
                combustion projects.
                    (B) Technical milestones.--The Secretary shall set 
                technical milestones specifying emissions levels for 
                projects funded under this paragraph. The milestones 
                shall be designed to increasingly restrict emissions 
                levels through the life of the program. The milestones 
                shall be designed to achieve by 2020 coal gasification 
                projects able--
                            (i) to remove 99 percent of sulfur dioxide;
                            (ii) to emit no more than .05 lb of 
                        NO&lt;INF&gt;X&lt;/INF&gt; per million BTU;
                            (iii) to achieve substantial reductions in 
                        mercury emissions; and
                            (iv) to achieve a thermal efficiency of--
                                    (I) 60 percent for coal of more 
                                than 9,000 Btu;
                                    (II) 59 percent for coal of 7,000 
                                to 9,000 Btu; and
                                    (III) 50 percent for coal of less 
                                than 7,000 Btu.
            (2) Other projects.--For projects not described in 
        paragraph (1), the Secretary shall set technical milestones 
        specifying emissions levels. The milestones shall be designed 
        to increasingly restrict emissions levels through the life of 
        the program. The milestones shall be designed to achieve by 
        2010 projects able--
                    (A) to remove 97 percent of sulfur dioxide;
                    (B) to emit no more than .08 lb of NO&lt;INF&gt;X&lt;/INF&gt; 
                per million BTU;
                    (C) to achieve substantial reductions in mercury 
                emissions; and
                    (D) except as provided in paragraph (4), to achieve 
                a thermal efficiency of--
                            (i) 45 percent for coal of more than 9,000 
                        Btu;
                            (ii) 44 percent for coal of 7,000 to 9,000 
                        Btu; and
                            (iii) 40 percent for coal of less than 
                        7,000 Btu.
            (3) Consultation.--Before setting the technical milestones 
        under paragraphs (1)(B) and (2), the Secretary shall consult 
        with the Administrator of the Environmental Protection Agency 
        and interested entities, including coal producers, industries 
        using coal, organizations to promote coal or advanced coal 
        technologies, environmental organizations, and organizations 
        representing workers.
            (4) Existing units.--In the case of projects at coal-
        powered electricity generating facilities existing as of the 
        date of enactment of this Act, in lieu of the thermal 
        efficiency requirements set forth in paragraph (1)(B)(iv) and 
        (2)(D), the projects shall be designed to achieve an overall 
        thermal efficiency improvement, compared to the efficiency of 
        the unit as of the date of enactment of this Act, of not less 
        than--
                    (A) 7 percent for coal of more than 9,000 Btu;
                    (B) 6 percent for coal of 7,000 to 9,000 Btu; and
                    (C) 4 percent for coal of less than 7,000 Btu.
            (5) Permitted uses.--In allocating amounts made available 
        under this title, the Secretary may fund projects that include 
        as part of the project the separation and capture of carbon 
        dioxide.
    (c) Financial Criteria.--The Secretary shall not provide a funding 
award under this title unless the recipient has documented to the 
satisfaction of the Secretary that--
            (1) the award recipient is financially viable without the 
        receipt of additional Federal funding;
            (2) the recipient will provide sufficient information to 
        the Secretary for the Secretary to ensure that the award funds 
        are spent efficiently and effectively; and
            (3) a market exists for the technology being demonstrated 
        or applied, as evidenced by statements of interest in writing 
        from potential purchasers of the technology.
    (d) Financial Assistance.--The Secretary shall provide financial 
assistance to projects that meet the requirements of subsections (a), 
(b), and (c) and are likely to--
            (1) achieve overall cost reductions in the utilization of 
        coal to generate useful forms of energy;
            (2) improve the competitiveness of coal among various forms 
        of energy in order to maintain a diversity of fuel choices in 
        the United States to meet electricity generation requirements; 
        and
            (3) demonstrate methods and equipment that are applicable 
        to 25 percent of the electricity generating facilities that use 
        coal as the primary feedstock as of the date of the enactment 
        of this Act.
    (e) Federal Share.--The Federal share of the cost of a project 
funded under this title shall not exceed 50 percent.
    (f) Applicability.--No technology, or level of emission reduction, 
shall be treated as adequately demonstrated for purposes of any other 
statute solely by reason of the use of such technology, or the 
achievement of such emission reduction, by one or more facilities 
receiving assistance under this title, unless this title is 
specifically referenced in such statute.

SEC. 202. REPORT.

    Not later than 1 year after the date of the enactment of this Act, 
and once every 2 years thereafter through 2012, the Secretary, in 
consultation with other appropriate Federal agencies, shall transmit to 
the Congress a report describing--
            (1) the technical milestones set forth in section 201 and 
        how those milestones ensure progress toward meeting the 
        requirements of subsections (b)(1)(B) and (b)(2) of section 
        201; and
            (2) the status of projects funded under this title.

SEC. 203. CLEAN COAL CENTERS OF EXCELLENCE.

    As part of the program authorized under this title, the Secretary 
shall award competitive, merit-based grants to universities for the 
establishment of Centers of Excellence for Energy Systems of the 
Future. The Secretary shall provide grants to universities that can 
show the greatest potential for advancing new clean coal technologies.

SEC. 204. AUTHORIZATION OF APPROPRIATIONS.

    (a) Clean Coal Power Initiative.--Except as provided in subsection 
(b), there are authorized to be appropriated to the Secretary to carry 
out the activities authorized by this title $200,000,000 for each of 
the fiscal years 2005 through 2013, to remain available until expended.
    (b) Limit on Use of Funds.--
            (1) Obligation of funds.--The Secretary is authorized to 
        obligate the use of funds under this section prior to the 
        fiscal year such funds are authorized for under subsection (a), 
        subject to appropriations.
            (2) Report.--The Secretary shall transmit to the Congress a 
        report describing the proposed use of funds which includes--
                    (A) a detailed assessment of whether the aggregate 
                funding levels provided under subsection (a) are the 
                appropriate funding levels for this title;
                    (B) a detailed description of how proposals will be 
                solicited and evaluated, including a list of all 
                activities expected to be undertaken;
                    (C) a detailed list of technical milestones for 
                each technology that will be pursued; and
                    (D) a detailed description of how the initiative 
                under this title will avoid problems enumerated in 
                General Accounting Office reports on the Clean Coal 
                Technology Program, including problems that have 
                resulted in unspent funds and projects that failed 
                either financially or scientifically.
            (3) Use of funds.--The Secretary may not use funds 
        appropriated under this section until 30 days have elapsed 
        after receipt of the report under paragraph (2).
    (c) Applicability.--Subsection (b) shall not apply to any project 
selected before September 30, 2004.