To increase the renewable fuel content of gasoline sold in the United States by the year 2025 to 25 billion gallons, to require Federal agencies to use ethanol and biodiesel in government vehicles, and for other purposes.

SECTION 1. RENEWABLE FUEL CONTENT OF GASOLINE.

    (a) Calendar Years From 2012 to 2025.--Clause (i) of section 
211(o)(2)(B) of the Clean Air Act (42 U.S.C. 7545(o)(2)(B)) is amended 
by striking ``2006 through 2012'' in each place it appears and 
inserting ``2006 through 2025'' and by adding the following new table 
at the end thereof:

``Applicable volume of renewable                               Calendar
  fuel (in billions of gallons):                                  year:
        8.9....................................................   2013 
        10.3...................................................   2014 
        11.7...................................................   2015 
        12.1...................................................   2016 
        13.5...................................................   2017 
        14.9...................................................   2018 
        16.3...................................................   2019 
        17.7...................................................   2020 
        19.4...................................................   2021 
        20.8...................................................   2022 
        22.2...................................................   2023 
        23.6...................................................   2024 
        25..................................................... 2025''.
    (b) Calendar Years After 2025.--Section 211(o)(2)(B) of such Act is 
amended by striking clauses (ii) through (iv) and inserting the 
following:
                            ``(ii) Calendar years after 2025.--For the 
                        purposes of subparagraph (A), for calendar 
                        years after 2025 the applicable volume shall be 
                        equal to the product obtained by multiplying 
                        subclause (I) by subclause (II) of this clause.
                                    ``(I) The number of gallons of 
                                gasoline that the Administrator 
                                estimates will be sold or introduced 
                                into commerce in the calendar year 
                                concerned.
                                    ``(II) The ratio that 
                                25,000,000,000 gallons bears to the 
                                number of gallons of gasoline sold or 
                                introduced into commerce in calendar 
                                year 2025''.
    (c) Credit for 85 Percent Ethanol Blend.--Section 211(o)(4) of such 
Act is amended by inserting ``or 85 percent ethanol blend'' in the 
heading before the period and by adding the following at the end 
thereof ``For the purposes of paragraph (2), 1 gallon of a fuel blend 
containing 85 percent ethanol and 15 percent gasoline shall be 
considered to be the equivalent of 1.5 gallons of renewable fuel.''.
    (d) Conforming Amendments.--Paragraph (3) and (6) of section 211(o) 
of such Act are each amended by striking ``2011'' and ``2012'' in each 
place it appears and inserting ``2024'' and ``2025'' respectively.

SEC. 2. FEDERAL AGENCY ETHANOL-BLENDED GASOLINE AND BIODIESEL 
              PURCHASING REQUIREMENT.

    Title III of the Energy Policy Act of 1992 is amended by striking 
section 306 (42 U.S.C. 13215) and inserting the following:

``SEC. 306. FEDERAL AGENCY ETHANOL-BLENDED GASOLINE AND BIODIESEL 
              PURCHASING REQUIREMENT.

    ``(a) Ethanol-Blended Gasoline.--The head of each Federal agency 
shall ensure that, in areas in which ethanol-blended gasoline is 
reasonably available at a generally competitive price, the Federal 
agency purchases ethanol-blended gasoline containing at least 10 
percent ethanol rather than nonethanol-blended gasoline, for use in 
vehicles used by the agency that use gasoline.
    ``(b) Biodiesel.--
            ``(1) Definition of biodiesel.--In this subsection, the 
        term `biodiesel' has the meaning given the term in section 
        312(f).
            ``(2) Requirement.--The head of each Federal agency shall 
        ensure that the Federal agency purchases, for use in fueling 
        fleet vehicles that use diesel fuel used by the Federal agency 
        at the location at which fleet vehicles of the Federal agency 
        are centrally fueled, in areas in which the biodiesel-blended 
        diesel fuel described in subparagraphs (A) and (B) is available 
        at a generally competitive price--
                    ``(A) as of the date that is 5 years after the date 
                of enactment of this paragraph, biodiesel-blended 
                diesel fuel that contains at least 2 percent biodiesel, 
                rather than nonbiodiesel-blended diesel fuel; and
                    ``(B) as of the date that is 10 years after the 
                date of enactment of this paragraph, biodiesel-blended 
                diesel fuel that contains at least 20 percent 
                biodiesel, rather than nonbiodiesel-blended diesel 
                fuel.
            ``(3) Requirement of federal law.--The provisions of this 
        subsection shall not be considered a requirement of Federal law 
        for the purposes of section 312.
    ``(c) Exemption.--This section does not apply to fuel used in 
vehicles excluded from the definition of `fleet' by subparagraphs (A) 
through (H) of section 301(9).''.

SEC. 3. REAUTHORIZATION OF DEPARTMENT OF AGRICULTURE BIOENERGY PROGRAM.

    (a) Reauthorization.--Subsection (c) of section 9010 of the Farm 
Security and Rural Investment Act of 2002 (7 U.S.C. 8108) is amended by 
striking paragraph (2) and inserting the following new paragraph:
            ``(2) $140,000,000 for each of fiscal years 2007 through 
        2015.''.
    (b) Funding Priorities.--Such section is further amended--
            (1) by redesignating subsection (c), as amended by 
        subsection (a), as subsection (d); and
            (2) by inserting after subsection (b) the following new 
        subsection:
    ``(c) Contract Priorities.--In entering into contracts under this 
section, the Secretary shall give priority to eligible producers 
participating in bioenergy initiatives involving--
            ``(1) the production of cellulosic ethanol, including how 
        to make it more cost effective; and
            ``(2) the production of hydrogen using ethanol 
        technology.''.

SEC. 4. 7-YEAR DEPRECIATION OF ETHANOL AND BIODIESEL REFINING PROPERTY.

    (a) In General.--Subparagraph (C) of section 168(e)(3) of the 
Internal Revenue Code of 1986 (relating to 7-year property) is amended 
by striking ``and'' at the end of clause (iv), by redesignating clause 
(v) as clause (vi), and by inserting after clause (iv) the following 
new clause:
                            ``(v) any ethanol or biodiesel refining 
                        property.''.
    (b) Ethanol or Biodiesel Refining Property.--Section 168(i) of such 
Code is amended by adding at the end the following new paragraph:
            ``(18) Ethanol or biodiesel refining property.--The term 
        `ethanol and biodiesel refining property' means--
                    ``(A) property used to produce biodiesel (as 
                defined in section 40A(d)(1)), and
                    ``(B) property used to produce ethanol other than 
                from petroleum, natural gas, or coal (including 
                lignite).''.
    (c) Alternative Depreciation System.--The table contained in 
section 168(g)(3)(B) of such Code (relating to special rule for certain 
property assigned to classes) is amended by inserting after the item 
relating to subparagraph (C)(iv) the following new item:

 
 
 
``(C)(v)...................................................         7''.
 

    (d) Alternative Minimum Tax.--Subparagraph (B) of section 56(a)(1) 
of such Code is amended by striking ``section 168(e)(3)(C)(iv)'' and 
inserting ``clause (iv) or (v) of section 168(e)(3)(C)''.
    (e) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply to property placed in service after the date of the 
        enactment of this Act.
            (2) Exception.--The amendments made by this section shall 
        not apply to any property with respect to which the taxpayer or 
        a related party has entered into a binding contract for the 
        construction thereof on or before such date, or, in the case of 
        self-constructed property, has started construction on or 
        before such date.

SEC. 5. STREAMLINED PERMITTING.

    The Secretary of Energy shall undertake a study to evaluate current 
permitting requirements applicable to the construction of new petroleum 
industry facilities (including refineries, pipelines, and related 
facilities). The study shall identify the problems and identify 
improvements. The Secretary shall submit a report the Congress 
containing the results of the study.

SEC. 6. EXTENSION AND EXPANSION OF TAX INCENTIVES FOR RENEWABLE FUELS.

    (a) Alternative Technology Vehicle Credit.--
            (1) Extension.--Subsection (j) of section 30B of the 
        Internal Revenue Code of 1986 (relating to alternative motor 
        vehicle credit) is amended to read as follows:
    ``(j) Termination.--This section shall not apply to any property 
purchased after December 31, 2014.''.
            (2) Increased credit for certain hybrid-flexible fuel 
        vehicles.--
                    (A) In general.--Subsection (a) of section 30B of 
                such Code is amended by striking ``and'' at the end of 
                paragraph (3), by striking paragraph (4), and by 
                inserting after paragraph (3) the following new 
                paragraphs:
            ``(4) the new flexible fuel hybrid motor vehicle credit 
        determined under subsection (e), and
            ``(5) the new qualified alternative fuel motor vehicle 
        credit determined under subsection (f).''.
                    (B) New flexible fuel hybrid motor vehicle 
                credit.--Section 30B of such Code is amended by 
                redesignating subsections (e) through (j) as 
                subsections (f) through (k), respectively, and by 
                inserting after subsection (d) the following new 
                subsection:
    ``(e) New Flexible Fuel Hybrid Motor Vehicle Credit.--
            ``(1) In general.--For purposes of subsection (a), the new 
        flexible fuel hybrid motor vehicle credit determined under this 
        subsection for the taxable year is the credit amount determined 
        under paragraph (2) with respect to a new hybrid flexible fuel 
        motor vehicle placed in service by the taxpayer during the 
        taxable year.
            ``(2) Credit amount.--
                    ``(A) In general.--The credit amount determined 
                under this paragraph shall be determined in accordance 
                with the following table:

``In the case of a vehicle the city
  fuel economy of which
  (expressed as a percentage of
  the city fuel economy of the
  comparable vehicle referred                                The credit
  to in paragraph (3)(B)) is--                              amount is--
        At least 125 percent but less than 150 percent......... $1,500 
        At least 150 percent but less than 175 percent......... $2,000 
        At least 175 percent but less than 200 percent......... $2,500 
        At least 200 percent but less than 225 percent......... $3,000 
        At least 225 percent................................... $3,500.
                    ``(B) Fuel economy.--For purposes of subparagraph 
                (A), the city fuel economy of the vehicle for which the 
                credit is being determined shall be determined on a E-
                85 ethanol gallon equivalent basis (as determined by 
                the Administrator of the Environmental Protection 
                Agency), and the city fuel economy of the comparable 
                vehicle referred to in paragraph (3)(B) shall be 
                determined on a gasoline gallon equivalent basis (as so 
                determined).
            ``(3) New flexible fuel hybrid motor vehicle.--For purposes 
        of this subsection, the term `new flexible fuel hybrid motor 
        vehicle' means a new qualified hybrid motor vehicle--
                    ``(A) which is capable of operating on an 
                alternative fuel, on gasoline, and on any blend 
                thereof, and
                    ``(B) which is certified by the Administrator of 
                the Environmental Protection Agency, in consultation 
                with the manufacturer, to have achieved a city fuel 
                economy using E-85 ethanol which is at least 125 
                percent of the city fuel economy of a comparable 
                vehicle that is a nonhybrid internal combustion vehicle 
                fueled by gasoline.
            ``(4) Coordination with subsection (d).--Subsection (d) 
        shall not apply to any motor vehicle for which credit is 
        allowed under this subsection.''.
                    (C) Vehicles included in numeric limitation.--
                Paragraph (1) of section 30B(g) of such Code, as 
                redesignated by subparagraph (A), is amended by 
                striking ``or (d)'' and inserting ``, (d), or (e)''.
                    (D) Conforming amendments.--
                            (i) Subparagraph (A) of section 30B(i)(5) 
                        of such Code, as so redesignated, is amended by 
                        striking ``subsection (e)'' and inserting 
                        ``subsection (f)''.
                            (ii) Paragraph (6) of section 30B(i) of 
                        such Code, as so redesignated, is amended by 
                        striking ``subsection (g)'' and inserting 
                        ``subsection (h)''.
                            (iii) Subsection (b) of section 38 of such 
                        Code is amended by striking ``section 
                        30B(g)(1)'' and inserting ``section 
                        30B(h)(1)''.
                            (iv) Paragraph (36) of section 1016(a) of 
                        such Code is amended by striking ``section 
                        30B(h)(4)'' and inserting ``section 
                        30B(i)(4)''.
    (b) Alternative Fuel Vehicle Refueling Property Credit.--
            (1) Extension.--Subsection (g) of section 30C of such Code 
        is amended to read as follows:
    ``(g) Termination.--This section shall not apply to any property 
placed in service after December 31, 2024.''.
            (2) Increase.--Subsection (a) of section 30C of such Code 
        is amended to read as follows:
    ``(a) Credit Allowed.--There shall be allowed as a credit against 
the tax imposed by this chapter for the taxable year an amount equal to 
the applicable percentage of the cost of any qualified alternative fuel 
vehicle refueling property placed in service by the taxpayer during the 
taxable year.
    ``(b) Applicable Percentage.--For purposes of subsection (a), the 
applicable percentage is--
``In the case of taxable years                           The applicable
  beginning during:                                      percentage is:
    2006 through 2010.............................          75 percent 
    2011 through 2015.............................          50 percent 
    2016 through 2024.............................       25 percent.''.
    (c) Volumetric Excise Tax Credit for Alternative Fuels; Alternative 
Fuel Mixture Credit.--
            (1) Volumetric excise tax credit.--Paragraph (4) of section 
        6426(d) of such Code is amended to read as follows:
            ``(4) Termination.--This subsection shall not apply to any 
        sale or use after September 30, 2014.''.
            (2) Alternative fuel mixture credit.--Paragraph (3) of 
        section 6426(e) of such Code is amended to read as follows:
            ``(3) Termination.--This subsection shall not apply to any 
        sale or use for any period after September 30, 2014.''.
            (3) Conforming amendment.--Paragraph (5) of section 6427(e) 
        of such Code is amended by adding ``and'' at the end of 
        subparagraph (B), by striking subparagraphs (C) and (D) and 
        inserting the following new subparagraph:
                    ``(C) any alternative fuel or alternative fuel 
                mixture (as defined in subsection (d)(2) or (e)(3) of 
                section 6426) sold or used after September 30, 2014.''.
    (d) Biodiesel Producer Credit.--Subsection (g) of section 40A of 
such Code is amended by striking ``December 31, 2008'' and inserting 
``December 31, 2024''.
    (e) Small Ethanol Producer Credit.--Paragraph (1) of section 40(e) 
of such Code is amended by adding at the end the following flush 
sentence:
        ``In the case of the small ethanol producer credit under 
        subsection (a)(3), the preceding sentence shall be applied by 
        substituting `December 31, 2024' for `December 31, 2010' and by 
        substituting `January 1, 2025' for `January 1, 2016'.''.

Summary: Amends the Clean Air Act to extend to 2025 certain requirements increasing the applicable volume of renewable fuel in gasoline. Amends the Energy Policy Act of 1992 to require the head of each federal agency to ensure that, in areas in which ethanol-blended gasoline is reasonably available at a generally competitive price, the agency purchases such gasoline with at least 10 ethanol, rather than nonethanol-blended gasoline, for its vehicles that use gasoline. Amends the Farm Security and Rural Investment Act of 2002 to: (1) authorize appropriations for FY2007-FY2015 to the Department of Agriculture bioenergy program. And (2) direct the Secretary of Agriculture to give priority to production of both cellulosic ethanol, and hydrogen using ethanol technology. Amends the Internal Revenue Code to make ethanol and biodiesel refining property eligible for 7-year depreciation. Creates a new flexible fuel hybrid motor vehicle income tax credit. Extends: (1) the alternative technology vehicle credit through calendar 2014. (2) the alternative fuel vehicle refueling property credit through calendar 2024. (3) the volumetric excise tax credit for alternative fuels and the alternative fuel mixture credit through FY2014. And (6) the biodiesel producer credit and the small ethanol producer credit through calendar 2024.