II 

115TH CONGRESS 

1ST SESSION S. 988 

To amend the Internal Revenue Code of 1986 to make qualified biogas 

property and qualified manure resource recovery property eligible for 

the energy credit and to permit new clean renewable energy bonds to 

finance qualified biogas property, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

APRIL 27, 2017 

Mr. BROWN (for himself and Mr. ROBERTS) introduced the following bill; 

which was read twice and referred to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to make 

qualified biogas property and qualified manure resource 

recovery property eligible for the energy credit and to 

permit new clean renewable energy bonds to finance 

qualified biogas property, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Agriculture Environ5 mental Stewardship Act of 2017’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds the following: 


SSpencer on DSK4SPTVN1PROD with BILLS
2 

•S 988 IS

1 (1) Incentives and encouragement for the con2 servation and appropriate handling of nutrients con3 tained in organic matter are necessary. 

4 (2) Biogas systems will save Federal, State, and 

5 local taxpayers money by converting waste into use6 ful products, such as fuel, fertilizer, thermal heat, 

7 feedstock for hydrogen fuel cells, and renewable 

8 chemicals. 

9 (3) Manure resource recovery systems will save 

10 Federal, State, and local taxpayers money by recov11 ering the nutrients contained in organic matter from 

12 their source, rather than recovering the nutrients 

13 after they have entered landfills or waterways. 

14 SEC. 3. ENERGY CREDIT FOR QUALIFIED BIOGAS PROP15 ERTY AND QUALIFIED MANURE RESOURCE 

16 RECOVERY PROPERTY. 

17 (a) IN GENERAL.—Section 48(a)(3)(A) of the Inter18 nal Revenue Code of 1986 is amended by striking ‘‘or’’ 

19 at the end of clause (vi) and by adding at the end the 

20 following new clauses: 

21 ‘‘(viii) qualified biogas property, or 

22 ‘‘(ix) qualified manure resource recov23 ery property,’’. 

24 (b) 30-PERCENT CREDIT.—Section 48(a)(2)(A)(i) of 

25 such Code is amended by striking ‘‘and’’ at the end of 


SSpencer on DSK4SPTVN1PROD with BILLS
3 

•S 988 IS

1 subclause (III), by striking ‘‘and’’ at the end of subclause 

2 (IV), and by adding at the end the following new sub3 clauses: 

4 ‘‘(V) qualified biogas property, 

5 and 

6 ‘‘(VI) qualified manure resource 

7 recovery property, and’’. 

8 (c) DEFINITIONS.—Section 48(c) of such Code is 

9 amended by adding at the end the following new para10 graphs: 

11 ‘‘(5) QUALIFIED BIOGAS PROPERTY.— 

12 ‘‘(A) IN GENERAL.—The term ‘qualified 

13 biogas property’ means property comprising a 

14 system which— 

15 ‘‘(i) uses anaerobic digesters, or other 

16 biological, chemical, thermal, or mechanical 

17 processes (alone or in combination), to 

18 convert biomass (as defined in section 

19 45K(c)(3)) into a gas which consists of not 

20 less than 52 percent methane, and 

21 ‘‘(ii) captures such gas for use as a 

22 fuel. 

23 ‘‘(B) INCLUSION OF CERTAIN CLEANING

24 AND CONDITIONING EQUIPMENT.—Such term 

25 shall include any property which cleans and 


SSpencer on DSK4SPTVN1PROD with BILLS
4 

•S 988 IS

1 conditions the gas referred to in subparagraph 

2 (A) for use as a fuel. 

3 ‘‘(C) TERMINATION.—No credit shall be 

4 determined under this section with respect to 

5 any qualified biogas property for any period 

6 after December 31, 2021. 

7 ‘‘(6) QUALIFIED MANURE RESOURCE RECOVERY

8 PROPERTY.— 

9 ‘‘(A) IN GENERAL.—The term ‘qualified 

10 manure resource recovery property’ means 

11 property comprising a system which uses phys12 ical, biological, chemical, thermal, or mechanical 

13 processes to recover the nutrients nitrogen and 

14 phosphorus from a non-treated digestate or ani15 mal manure by reducing or separating at least 

16 50 percent of the concentration of such nutri17 ents, excluding any reductions during the incin18 eration, storage, composting, or field application 

19 of the non-treated digestate or animal manure. 

20 ‘‘(B) INCLUSION OF CERTAIN PROCESSING

21 EQUIPMENT.—Such term shall include— 

22 ‘‘(i) any property which is used to re23 cover the nutrients referred to in subpara24 graph (A), such as— 

25 ‘‘(I) biological reactors, 


SSpencer on DSK4SPTVN1PROD with BILLS
5 

•S 988 IS

1 ‘‘(II) crystallizers, 

2 ‘‘(III) reverse osmosis mem3 branes and other water purifiers, 

4 ‘‘(IV) evaporators, 

5 ‘‘(V) distillers, 

6 ‘‘(VI) decanter centrifuges, and 

7 ‘‘(VII) equipment that facilitates 

8 the process of dissolved air flotation, 

9 ammonia stripping, gasification, or 

10 ozonation, and 

11 ‘‘(ii) any thermal drier which treats 

12 the nutrients recovered by the processes re13 ferred to in subparagraph (A). 

14 ‘‘(C) TERMINATION.—No credit shall be 

15 determined under this section with respect to 

16 any qualified manure resource recovery prop17 erty for any period after December 31, 2021.’’. 

18 (d) DENIAL OF DOUBLE BENEFIT FOR QUALIFIED

19 BIOGAS PROPERTY.—Section 45(e) of such Code is 

20 amended by adding at the end the following new para21 graph: 

22 ‘‘(12) COORDINATION WITH ENERGY CREDIT

23 FOR QUALIFIED BIOGAS PROPERTY.—The term 

24 ‘qualified facility’ shall not include any facility which 

25 produces electricity from gas produced by qualified 


SSpencer on DSK4SPTVN1PROD with BILLS
6 

•S 988 IS

1 biogas property (as defined in section 48(c)(5)) if a 

2 credit is determined under section 48 with respect to 

3 such property for the taxable year or any prior tax4 able year.’’. 

5 (e) EFFECTIVE DATE.—The amendments made by 

6 this section shall apply to periods after December 31, 

7 2016, in taxable years ending after such date, under rules 

8 similar to the rules of section 48(m) of such Code (as in 

9 effect on the day before the date of the enactment of the 

10 Revenue Reconciliation Act of 1990). 

11 SEC. 4. NEW CLEAN RENEWABLE ENERGY BONDS FOR 

12 QUALIFIED BIOGAS PROPERTY AND QUALI13 FIED MANURE RESOURCE RECOVERY PROP14 ERTY. 

15 (a) IN GENERAL.—Section 54C(d)(1) of the Internal 

16 Revenue Code of 1986 is amended by inserting ‘‘, a quali17 fied biogas property (as defined in section 48(c)(5)), or 

18 a qualified manure resource recovery property (as defined 

19 in section 48(c)(6))’’ before ‘‘owned by’’. 

20 (b) EFFECTIVE DATE.—The amendment made by 

21 this section shall apply to obligations issued after the date 

22 of the enactment of this Act. 

23 SEC. 5. STUDY OF BIOGAS AND NUTRIENT REUSE. 

24 (a) IN GENERAL.—The Secretary of the Treasury 

25 shall enter into an agreement with the National Renewable 


SSpencer on DSK4SPTVN1PROD with BILLS
7 

•S 988 IS

1 Energy Laboratory to undertake a study of biogas that 

2 addresses the following: 

3 (1) The quality of biogas, including a compari4 son of biogas to natural gas and the identification 

5 of any components of biogas which make biogas un6 suitable for injection into existing natural gas pipe7 lines. 

8 (2) Methods for obtaining the highest energy 

9 content in biogas, including the use of co-digestion 

10 and identifying the optimal feed mixture. 

11 (3) Recommendations for the expansion of 

12 biogas production, including an analysis of the ex13 tent to which increasing the methane content of 

14 biogas would result in the greater use of biogas and 

15 an analysis of how the expanded use of biogas could 

16 help meet the growing energy needs of the United 

17 States. 

18 (4) Methods for productive use of nutrients re19 covered from qualified manure resource recovery 

20 property that benefit the agricultural economy. 

21 (b) REPORT.—Not later than 2 years after the date 

22 of the enactment of this Act, the Secretary shall submit 

23 to Congress a report on the study conducted under sub24 section (a). 

Æ 


SSpencer on DSK4SPTVN1PROD with BILLS