To amend the Clean Air Act to promote and assure the quality of biodiesel fuel, and for other purposes.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Biodiesel Promotion and Quality 
Assurance Act of 2007''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) the promotion of the biodiesel industry of the United 
        States is a critical component of an energy policy that reduces 
        dependence on foreign sources of petroleum;
            (2) a strong biodiesel industry will--
                    (A) significantly enhance the energy security of 
                the United States; and
                    (B) promote economic development and job creation 
                (particularly in rural areas of the United States), 
                while providing environmental, health, and greenhouse 
                gas reduction benefits;
            (3) a federally-implemented biodiesel standard will result 
        in the most efficient pricing for biodiesel across the United 
        States;
            (4) it is critical to ensure that only high quality 
        biodiesel is dispensed;
            (5) biodiesel contributes to cleaner air and lifecycle 
        reductions of greenhouse gases;
            (6) biodiesel is an environmentally safe fuel, and is the 
        most viable transportation fuel when measuring its carbon 
        footprint, life cycle and energy balance;
            (7) the United States Department of Agriculture lifecycle 
        study shows a 78.4 percent reduction in lifecycle CO2 for B100;
            (8) 1 billion gallons of biodiesel will reduce current life 
        cycle greenhouse gas emissions by 16.12 billion pounds, the 
        equivalent of removing 1.4 million passenger vehicles from 
        America's roads; and
            (9) in 2006 alone, biodiesel's contribution to reducing 
        greenhouse gas emissions was equal to removing 350,000 
        passenger vehicles from America's roads.

SEC. 3. BIODIESEL FUEL STANDARD.

    Section 211 of the Clean Air Act (42 U.S.C. 7545) is amended by 
inserting after subsection (o) the following:
    ``(p) Biodiesel Fuel.--
            ``(1) Definitions.--In this subsection:
                    ``(A) ASTM.--The term `ASTM' means the American 
                Society of Testing and Materials.
                    ``(B) Bio-based diesel replacement.--The term `bio-
                based diesel replacement' means any type of bio-based 
                renewable fuel derived from plant or animal matter 
                that--
                            ``(i) may be used as a substitute for 
                        standard diesel fuel; and
                            ``(ii) meets--
                                    ``(I) the registration requirements 
                                for fuels and fuel additives under this 
                                section; and
                                    ``(II) the requirements of 
                                applicable ASTM standards.
                    ``(C) Biodiesel.--
                            ``(i) In general.--The term `biodiesel' 
                        means the monoalkyl esters of long chain fatty 
                        acids derived from plant or animal matter that 
                        meet--
                                    ``(I) the registration requirements 
                                for fuels and fuel additives under this 
                                section; and
                                    ``(II) the requirements of ASTM 
                                standard D6751.
                            ``(ii) Inclusion.--For the purpose of 
                        measuring the applicable volume of the 
                        biodiesel fuel standard under paragraph (2), 
                        the term `biodiesel' includes any bio-based 
                        diesel replacement that meets--
                                    ``(I) applicable registration 
                                requirements for fuels and fuel 
                                additives under this section; or
                                    ``(II) applicable ASTM standards.
                    ``(D) Biodiesel blend.--The term `biodiesel blend' 
                means a blend of biodiesel fuel that meets the 
                requirements of ASTM standard D6751 with petroleum-
                based diesel fuel.
            ``(2) Biodiesel fuel standard.--
                    ``(A) In general.--Not later than 1 year after the 
                date of enactment of this subsection, the Administrator 
                shall promulgate regulations to ensure that diesel fuel 
                sold or introduced into commerce in the United States, 
                on an annual average basis, contains the applicable 
                volume of biodiesel determined in accordance with 
                subparagraphs (B) and (C).
                    ``(B) Calendar years 2008 through 2012.--For the 
                purpose of subparagraph (A), the applicable volume for 
                any of calendar years 2008 through 2012 shall be 
                determined in accordance with the following table:
                                        Applicable volume of biodiesel 
``Calendar year:                              (in millions of gallons):
        2008...................................................    450 
        2009...................................................    625 
        2010...................................................    800 
        2011...................................................  1,000 
        2012...................................................  1,250.
                    ``(C) Calendar year 2013 and thereafter.--For the 
                purpose of subparagraph (A), the applicable volume for 
                calendar year 2013 and each calendar year thereafter 
                shall be determined by the Administrator, in 
                consultation with the Secretary of Energy and the 
                Secretary of Agriculture, based on a review of the 
                implementation of the program during calendar years 
                2008 through 2012, including a review of--
                            ``(i) the impact of the use of renewable 
                        fuels on the environment, air quality, energy 
                        security, job creation, and rural economic 
                        development; and
                            ``(ii) the expected annual rate of future 
                        production of biodiesel.
                    ``(D) Minimum percentage of biodiesel.--For the 
                purpose of subparagraph (B), at least 80 percent of the 
                minimum applicable volume for each of calendar years 
                2008 through 2012 shall be biodiesel.
                    ``(E) Compliance.--The regulations promulgated 
                under subparagraph (A) shall contain compliance 
                provisions applicable to refineries, blenders, 
                distributors, and importers, as appropriate, to ensure 
                that the requirements of this paragraph are met, but 
                shall not--
                            ``(i) restrict geographic areas in which 
                        biodiesel may be used; or
                            ``(ii) impose any per-gallon obligation for 
                        the use of biodiesel.
                    ``(F) Waivers.--
                            ``(i) Market evaluation.--The 
                        Administrator, in consultation with the 
                        Secretary of Energy and the Secretary of 
                        Agriculture, shall continually evaluate the 
                        impact of the biodiesel requirements 
                        established under this paragraph on the price 
                        of diesel fuel.
                            ``(ii) Waiver.--If the Administrator 
                        determines that there is a significant 
                        biodiesel feedstock disruption or other market 
                        circumstances that would make the price of 
                        biodiesel fuel unreasonable, the Administrator, 
                        with the concurrence of the Secretary of Energy 
                        and the Secretary of Agriculture, shall issue 
                        an order to reduce, for a 60-day period, the 
                        quantity of biodiesel required under 
                        subparagraph (A) by an appropriate quantity 
                        that does not exceed 15 percent of the 
                        applicable annual requirement for biodiesel.
                            ``(iii) Factors.--In making determinations 
                        under this subparagraph, the Administrator 
                        shall consider--
                                    ``(I) the purposes of this Act;
                                    ``(II) the differential between the 
                                price of diesel fuel and the price of 
                                biodiesel; and
                                    ``(III) the impact the biodiesel 
                                mandate has on consumers.
                            ``(iv) Extensions.--If the Administrator 
                        determines that the feedstock disruption or 
                        circumstances described in clause (ii) is 
                        continuing beyond the 60-day period described 
                        in clause (ii) or this clause, the 
                        Administrator, with the concurrence of the 
                        Secretary of Energy and the Secretary of 
                        Agriculture, may issue an order to reduce, for 
                        an additional 60-day period, the quantity of 
                        biodiesel required under subparagraph (A) by an 
                        appropriate quantity that does not exceed an 
                        additional 15 percent of the applicable annual 
                        requirement for biodiesel.
                            ``(v) Restoration.--If the Administrator 
                        determines that the feedstock disruption or 
                        circumstances described in clause (ii) or (iv) 
                        has concluded and that it is practicable, the 
                        Administrator, with the concurrence of the 
                        Secretary of Energy and the Secretary of 
                        Agriculture, may issue an order to increase the 
                        quantity of biodiesel required under 
                        subparagraph (A) by an appropriate quantity to 
                        account for the gallons of biodiesel not used 
                        during the period a waiver or extension was in 
                        effect under this subparagraph.
                    ``(G) Preemption.--
                            ``(i) In general.--Except as provided in 
                        clause (ii) of this subparagraph, the 
                        provisions of this section shall supersede any 
                        law of any State or political subdivision 
                        thereof insofar as it mandates the use of 
                        biodiesel.
                            ``(ii) Construction and application.--
                        Nothing in this section shall be construed--
                                    ``(I) to supersede any biodiesel 
                                mandate provided in any law described 
                                in clause (i) that is enacted as of 
                                January 1, 2008;
                                    ``(II) to prohibit a State or 
                                political subdivision thereof from 
                                mandating the use of biodiesel in 
                                vehicles owned by such State or 
                                political subdivisions thereof; or
                                    ``(III) to prohibit a State or 
                                political subdivision thereof from 
                                enacting financial incentives to 
                                promote the voluntary use of 
                                biodiesel.''.

SEC. 4. BIODIESEL QUALITY.

    Subsection (p) of section 211 of the Clean Air Act (42 U.S.C. 7545) 
(as added by section 3(a)) is amended by adding at the end the 
following:
            ``(3) Biodiesel quality.--
                    ``(A) Quality regulations.--Not later than 180 days 
                after the date of enactment of this subsection, the 
                Administrator, in consultation with the Secretary of 
                Energy and the Secretary of Agriculture, shall 
                promulgate regulations to ensure that only high-quality 
                biodiesel that is consistent with appropriate ASTM 
                International standards for biodiesel and biodiesel 
                blends is introduced into commerce.
                    ``(B) Enforcement.--The Administrator shall 
                establish an inspection program to ensure that 
                biodiesel and biodiesel blends entering commerce meets 
                the standards established under subparagraph (A).
                    ``(C) Violations.--Regardless of whether the 
                Administrator promulgates regulations under 
                subparagraph (A), it shall be a violation of this Act 
                to produce or distribute--
                            ``(i) biodiesel or any bio-based diesel 
                        replacement that does not meet the requirements 
                        of ASTM standard D6751; or
                            ``(ii) a biodiesel blend that does not meet 
                        the equivalent ASTM standard, as determined by 
                        the Administrator.
                    ``(D) Funding.--There are authorized to be 
                appropriated to carry out this paragraph $3,000,000 for 
                each of fiscal years 2008 through 2010.''.

SEC. 5. BIODIESEL LABELING.

    Subsection (p) of section 211 of the Clean Air Act (42 U.S.C. 7545) 
(as amended by section 4) is amended by adding at the end the 
following:
            ``(4) Biodiesel labeling.--
                    ``(A) In general.--Each retail diesel fuel pump 
                shall be labeled in a manner that informs consumers of 
                the percent of biodiesel that is contained in the 
                biodiesel blend that is offered for sale, as determined 
                by the Administrator.
                    ``(B) Labeling requirements.--Not later than 180 
                days after the date of enactment of this subsection, 
                the Administrator shall promulgate biodiesel labeling 
                requirements as follows:
                            ``(i) Biodiesel blends that contain less 
                        than or equal to 5 percent biodiesel by volume 
                        and that meet ASTM D975 diesel specifications 
                        shall not require any additional labels.
                            ``(ii) Biodiesel blends that contain more 
                        than 5 percent biodiesel by volume but not more 
                        than 20 percent by volume shall be labeled 
                        `contains biodiesel in quantities between 5 
                        percent and 20 percent'.
                            ``(iii) Biodiesel blends that contain more 
                        than 20 percent biodiesel by volume shall be 
                        labeled `contains more than 20 percent 
                        biodiesel'.''.

Summary: Biodiesel Promotion and Quality Assurance Act of 2007 - Amends the Clean Air Act to require the Administrator of the Environmental Protection Agency (EPA) to promulgate regulations to ensure that diesel fuel sold in the United States contains the volume of biodiesel specified for 2008 through 2012. Requires the Administrator to determine the volume for 2013 and thereafter based on a review of the program. Requires at least 80 of the minimum applicable volume for each of 2008 through 2012 to be biodiesel. Requires the biodiesel fuel standards to contain compliance provisions applicable to refineries, blenders, distributors, and importers. Prohibits such standards from restricting geographic areas in which biodiesel may be used or imposing any per-gallon obligation for the use of biodiesel. Authorizes the Administrator to reduce the quantity of biodiesel required by a specified amount if market circumstances would make the price of biodiesel fuel unreasonable. Declares that nothing in this Act shall be construed to supersede any biodiesel mandate provided in any state or local law enacted as of January 1, 2008. Requires the Administrator to: (1) promulgate regulations to ensure that only high-quality biodiesel that is consistent with appropriate International standards is introduced into commerce. And (2) establish an inspection program to ensure that biodiesel and biodiesel blends entering commerce meet such standards. Prohibits the production of distribution of biodiesel, a biodiesel blend, or any bio-based diesel replacement that does not meet American Society of Testing and Materials standards, regardless of whether the Administrator promulgates such regulations. Requires retail diesel fuel pumps to be labeled to inform consumers of the percent of biodiesel in the biodiesel blend.