Fuel Choice and Deregulation Act of 2015

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fuel Choice and Deregulation Act of 
2015''.

SEC. 2. ALTERNATIVE FUELS.

    (a) Aftermarket Conversions of Motor Vehicles to Alternative 
Fuel.--Section 203 of the Clean Air Act (42 U.S.C. 7522) is amended by 
adding at the end the following:
    ``(c) Older Vehicles.--
            ``(1) In general.--The aftermarket conversion of a vehicle 
        to alternative fuel operation shall not--
                    ``(A) be considered tampering under this section if 
                the aftermarket conversion system manufacturer or the 
                person performing the conversion is able to demonstrate 
                that the development and engineering sophistication of 
                the conversion technology is--
                            ``(i) matched to an appropriate vehicle or 
                        group of vehicles; and
                            ``(ii) well-designed and installed in 
                        accordance with good engineering judgment so 
                        that the aftermarket conversion system does not 
                        degrade emission performance, as compared to 
                        the performance of the vehicle or vehicles 
                        before the conversion; or
                    ``(B) require the issuance by the Administrator of 
                any certificate of conformity.
            ``(2) Label.--The person performing a conversion described 
        in paragraph (1) shall affix a label to the motor vehicle 
        stating that--
                    ``(A) the vehicle has been equipped with an 
                aftermarket conversion system; and
                    ``(B) the installation of that system occurred 
                after the initial sale of the vehicle.
            ``(3) No preclusion of orders.--Nothing in this subsection 
        may be construed to preclude the Administrator from issuing an 
        order to prohibit the manufacture, sale, distribution, or 
        installation of an aftermarket conversion system if the 
        Administrator has evidence that the installation of the 
        aftermarket conversion system on a vehicle degrades emission 
        performance.''.
    (b) Biomass Fuels.--Section 211 of the Clean Air Act (42 U.S.C. 
7545) is amended by adding at the end the following:
    ``(w) Biomass Fuels.--Notwithstanding any other provision of this 
Act, the Administrator may not prohibit or control biomass fuel (as 
defined in section 203 of the Biomass Energy and Alcohol Fuels Act of 
1980 (42 U.S.C. 8802)) under this Act.''.

SEC. 3. CALCULATION OF AVERAGE FUEL ECONOMY.

    (a) Definitions.--Section 32901(a) of title 49, United States Code, 
is amended--
            (1) by redesignating paragraphs (13) through (19) as 
        paragraphs (19) through (25);
            (2) by redesignating paragraphs (11) and (12) as paragraphs 
        (16) and (17), respectively;
            (3) by redesignating paragraph (10) as paragraph (13);
            (4) by redesignating paragraphs (7), (8), and (9) as 
        paragraphs (8), (9), and (10), respectively;
            (5) by inserting after paragraph (6) the following:
            ``(7) `biodiesel'--
                    ``(A) means liquid fuel derived from biomass that 
                meets--
                            ``(i) the registration requirements for 
                        fuels and fuel additives established by the 
                        Environmental Protection Agency under section 
                        211 of the Clean Air Act (42 U.S.C. 7545); and
                            ``(ii) the requirements of the ASTM 
                        Standard D6751; and
                    ``(B) does not include any liquid with respect to 
                which a credit may be determined under section 40 of 
                the Internal Revenue Code of 1986.'';
            (6) by inserting after paragraph (10), as redesignated, the 
        following:
            ``(11) `E85' means a fuel mixture that--
                    ``(A) contains between 51 and 83 percent ethanol; 
                and
                    ``(B) meets the specifications of the ASTM Standard 
                D5798.;
            ``(12) `flexible fuel vehicle' means a vehicle that has 
        been warranted to operate on gasoline, E85, and M85.'';
            (7) by inserting after paragraph (13), as redesignated, the 
        following:
            ``(14) `fuel choice enabling manufacturer' means a 
        manufacturer whose total fleet of automobiles manufactured for 
        the most recent model year for sale in the United States 
        contains at least 50 percent fuel choice enabling vehicles.
            ``(15) `fuel choice enabling vehicle' means an automobile 
        that--
                    ``(A) has been warranted to operate on natural gas, 
                hydrogen, propane, or at least 20 percent biodiesel;
                    ``(B) is a flexible fuel vehicle;
                    ``(C) is a plug-in electric drive vehicle;
                    ``(D) is propelled by a fuel cell that can produce 
                power without the use of petroleum or a petroleum-based 
                fuel; or
                    ``(E)(i) is propelled by something other than an 
                internal combustion engine; and
                    ``(ii) is warranted to operate on something other 
                than petroleum-based fuel.'';
            (8) by inserting after paragraph (17), as redesignated, the 
        following:
            ``(18) `M85' means a fuel mixture that--
                    ``(A) contains up to 85 percent methanol; and
                    ``(B) meets the specifications of the ASTM 
                International Standard D5797.''; and
            (9) by inserting after paragraph (25), as redesignated, the 
        following:
            ``(26) `plug-in electric drive vehicle' has the meaning 
        given such term in section 508(a) of the Energy Policy Act of 
        1992 (42 U.S.C. 13258(a)).''.
    (b) Fuel Choice Enabling Manufacturers.--Chapter 329 of title 49, 
United States Code, is amended--
            (1) in section 32902, by adding at the end the following:
    ``(l) Deemed Compliance With the Clean Air Act.--If a fuel choice 
enabling manufacturer is in compliance with all applicable standards 
prescribed under this section for model year 2016 or any subsequent 
model year, the automobiles manufactured by such manufacturer in such 
model year are deemed to be in compliance with all applicable 
greenhouse gas regulations established by the Environmental Protection 
Agency pursuant to section 202 of the Clean Air Act (42 U.S.C. 
7521).'';
            (2) in section 32903(a), by amending paragraph (2) to read 
        as follows:
            ``(2) any of the 5 consecutive model years immediately 
        after the model year for which the credits are earned, to the 
        extent that such credits are not used under paragraph (1);''; 
        and
            (3) in section 32904--
                    (A) by redesignating subsections (d) and (e) as 
                subsections (e) and (f), respectively; and
                    (B) by inserting after subsection (c) the 
                following:
    ``(d) Average Fuel Economy Bonus for Fuel Choice Enabling 
Manufacturers.--The average fuel economy of a fuel choice enabling 
manufacturer for a model year is the sum of--
            ``(1) the average fuel economy of such manufacturer for 
        such model year, as otherwise calculated pursuant to this 
        section; and
            ``(2) 8 miles per gallon.''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to automobiles manufactured for model year 2016 or 
for any subsequent model year.

SEC. 4. EQUALIZATION OF EXCISE TAX ON LIQUEFIED NATURAL GAS AND PER 
              ENERGY EQUIVALENT OF DIESEL.

    (a) In General.--Section 4041(a)(2) of the Internal Revenue Code of 
1986 is amended--
            (1) in subparagraph (B)--
                    (A) in clause (i), by striking ``and'' at the end;
                    (B) in clause (ii)--
                            (i) by striking ``liquefied natural gas,'';
                            (ii) by striking ``peat), and'' and 
                        inserting ``peat) and''; and
                            (iii) by striking the period at the end and 
                        inserting ``, and''; and
                    (C) by adding at the end the following new clause:
                            ``(iii) in the case of liquefied natural 
                        gas, 24.3 cents per energy equivalent of a 
                        gallon of diesel.''; and
            (2) by adding at the end the following:
                    ``(C) Energy equivalent of a gallon of diesel.--For 
                purposes of this paragraph, the term `energy equivalent 
                of a gallon of diesel' means, with respect to a 
                liquefied natural gas fuel, the amount of such fuel 
                having a Btu content of 128,700 (lower heating value).
                    ``(D) Administrative provisions.--For purposes of 
                applying this title with respect to the taxes imposed 
                by this subsection, references to any liquid subject to 
                tax under this subsection shall be treated as including 
                references to liquefied natural gas subject to tax 
                under this paragraph.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to any sale or use of liquefied natural gas after the date that 
is 14 days after the date of the enactment of this Act.

SEC. 5. ETHANOL WAIVER.

    Section 211(h)(4) of the Clean Air Act (42 U.S.C. 7545(h)(4)) is 
amended--
            (1) in the matter preceding subparagraph (A), by inserting 
        ``or more'' after ``10 percent''; and
            (2) in subparagraph (C), by striking ``additional alcohol 
        or''.

Summary: Fuel Choice and Deregulation Act of 2015 This bill amends the Clean Air Act to revise provisions concerning alternative fuel. Currently, a change to the original configuration of a certified vehicle or engine, including alternative fuel conversion, may be a potential violation of the Act's prohibition against tampering with devices used to control emissions from vehicles. The bill prohibits the aftermarket conversion of a vehicle to alternative fuel operation from: (1) being considered tampering under the Act if the conversion technology is matched to an appropriate vehicle and does not degrade emission performance, or (2) requiring the issuance by the Environmental Protection Agency (EPA) of any certificate of conformity. The bill also establishes labelling requirements for an aftermarket conversion. The EPA may not prohibit or control biomass fuel under the Act. Biomass fuel is produced by conversion of certain organic matter which is available on a renewable basis. If a fuel choice enabling manufacturer is in compliance with applicable fuel economy standards, the vehicles it makes are deemed to be in compliance with greenhouse gas regulations established by the EPA under the Act. The requirements governing the calculation of average fuel economy are revised, including by giving an average fuel economy bonus for those manufacturers. The bill amends the Internal Revenue Code to adjust the excise tax on liquefied natural gas to 24.3 cents per energy equivalent of a gallon of diesel. The Clean Air Act places Reid vapor pressure limitations, or gasoline volatility limits, on gasoline during the summer ozone season. Gasoline blended with 10 ethanol may exceed this limitation by a certain amount under the Act. The bill extends this waiver to gasoline blended with more than 10 ethanol.