II 

109TH CONGRESS 

2D SESSION S. 2571 

To promote energy production and conservation, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

APRIL 6, 2006 

Mr. CONRAD introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To promote energy production and conservation, 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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Breaking Our Long-Term Dependence Energy Act of 

6 2006’’ or the ‘‘BOLD Energy Act of 2006’’. 

7 (b) TABLE OF CONTENTS.—The table of contents of 

8 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Findings and purposes. 

Sec. 3. Definitions. 

TITLE I—VEHICLE FUEL ECONOMY 


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Sec. 101. National automobile fuel efficiency rebate program. 

Sec. 102. Research and development program for lightweight materials. 

Sec. 103. Tire efficiency program. 

Sec. 104. Idling reduction tax credit. 

TITLE II—ALTERNATIVE FUEL VEHICLES 

Sec. 201. Promotion of advanced technology motor vehicles. 

Sec. 202. Research and development program for new vehicle technologies. 

Sec. 203. Consumer incentives to purchase advanced technology vehicles. 

Sec. 204. Extension of full credit for qualified electric vehicles. 

TITLE III—ALTERNATIVE FUELS 

Sec. 301. Biofuels. 

Sec. 302. Continuation of bioenergy program. 

Sec. 303. Renewable fuel standard. 

Sec. 304. Minimum quantity of renewable fuel derived from cellulosic biomass. 

Sec. 305. Minimum quantity of renewable fuel derived from sugar. 

Sec. 306. Ethanol promotion program. 

Sec. 307. Renewable fuel program for the diesel motor pool. 

Sec. 308. Extension and modification of income and excise tax credits for renewable fuels. 

Sec. 309. Domestic refinery diversification. 

Sec. 310. Transition to a hydrogen-based economy. 

Sec. 311. Modification and extension of alternative vehicle refueling property 

credit. 

Sec. 312. Use of native grasses on conservation reserve land for biomass harvesting. 

Sec. 313. Use of CAFE ́ penalties to build alternative fueling infrastructure. 

TITLE IV—DOMESTIC PRODUCTION OF OIL AND NATURAL GAS 

Sec. 401. Modifications to enhanced oil recovery credit. 

Sec. 402. Offshore oil and gas leasing in 181 Area of Gulf of Mexico. 

TITLE V—ELECTRICITY AND RENEWABLES 

Sec. 501. DOE national and North American electricity grid studies. 

Sec. 502. Tax-exempt financing of electric transmission facilities not subject to 

private business use test. 

Sec. 503. Extension of credit for producing electricity from certain renewable 

resources. 

Sec. 504. Federal renewable portfolio standard. 

Sec. 505. Extension and expansion of clean renewable energy bonds. 

Sec. 506. Credit for wind energy property installed in residences and businesses. 

Sec. 507. Extension of business solar investment credit. 

Sec. 508. Extension of credit residential energy efficient property. 

Sec. 509. Clean energy coal bonds. 

Sec. 510. Increase in credit limitation for qualifying gasification projects. 

Sec. 511. Modification of qualifying advanced coal project credit. 

Sec. 512. Great Plains Synfuels Trust. 

TITLE VI—ENERGY EFFICIENCY 

Sec. 601. Energy credit for combined heat and power system property. 


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Sec. 602. Extension of new energy efficient home credit. 

Sec. 603. Modification and extension of energy efficient commercial buildings 

deduction. 

Sec. 604. Extension of nonbusiness energy property. 

1 SEC. 2. FINDINGS AND PURPOSES. 

2 (a) FINDINGS.—Congress finds that— 

3 (1) the dependence of the United States on for4 eign oil is projected to remain dangerously high over 

5 the next few decades unless serious action is taken; 

(2) over 1 6 ⁄3 of the trade deficit of the United 

7 States over the last year is because of imported pe8 troleum products; 

9 (3) oil prices in the United States have risen 

10 more than 95 percent over the last 2 years and are 

11 projected to remain at, or exceed, historically high 

12 levels for the foreseeable future; 

13 (4) Brazil has drastically decreased oil imports 

14 by aggressively promoting biofuels and flexible fuel 

15 vehicles; 

16 (5) using renewable energy, promoting clean 

17 coal technology, and offering incentives for energy 

18 efficiency will improve air quality and reduce the de19 mand for imported natural gas; 

20 (6) transmission capacity constraints prevent 

21 some regions of the United States from fully devel22 oping domestic energy resources; 


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1 (7) the United States has abundant domestic 

2 resources to create alternative fuels that will dra3 matically lessen dependence on foreign oil; 

4 (8) increasing funding for research, develop5 ment, and commercialization of new energy tech6 nologies will enable the United States to significantly 

7 reduce the reliance of the United States on foreign 

8 energy suppliers; 

9 (9) a bold energy plan to make the United 

10 States more energy-independent should be imple11 mented immediately; and 

12 (10) a bold and comprehensive energy plan will 

13 help keep energy prices affordable for consumers in 

14 the United States. 

15 (b) PURPOSES.—The purposes of this Act are— 

16 (1) to reduce the dependence of the United 

17 States on foreign oil; 

18 (2) to expand the production and use of alter19 native fuels and alternative fuel vehicles; 

20 (3) to promote the development of renewable 

21 energy sources for electricity production; 

22 (4) to encourage responsible development of do23 mestic fossil fuel resources; and 

24 (5) to reward consumers and businesses for 

25 conservation and energy efficiency. 


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1 SEC. 3. DEFINITIONS. 

2 In this Act: 

3 (1) BATTERY.—The term ‘‘battery’’ means an 

4 energy storage device used in an on-road or nonroad 

5 vehicle powered in whole or in part using an off6 board or on-board source of electricity. 

7 (2) CARBON CAPTURE CAPABILITY.—The term 

8 ‘‘carbon capture capability’’ means a gasification 

9 plant design that is determined by the Secretary to 

10 reflect reasonable consideration for, and be capable 

11 of, accommodating the equipment likely to be nec12 essary to capture carbon dioxide from the gaseous 

13 stream, for later use or sequestration, which would 

14 otherwise be emitted in the flue gas from a project 

15 that uses a nonrenewable fuel. 

16 (3) CTL.—The term ‘‘CTL’’ means the Coal17 To-Liquid process, by which any grade of coal is 

18 transformed into a liquid transportation fuel. 

19 (4) CTL REFINERY.—The term ‘‘CTL refin20 ery’’ means a facility at which coal is transformed 

21 into liquid transportation fuel through CTL. 

22 (5) ELECTRIC DRIVE TRANSPORTATION TECH23 NOLOGY.—The term ‘‘electric drive transportation 

24 technology’’ means technology used by vehicles that 

25 use an electric motor for all or part of their motive 

26 power and that may or may not use off-board elecVerDate Aug 31 2005 21:34 Apr 14, 2006 Jkt 049200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2571.IS S2571

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1 tricity, such as battery electric vehicles, fuel cell ve2 hicles, engine dominant hybrid electric vehicles, plug3 in hybrid electric vehicles, and plug-in hybrid fuel 

4 cell vehicles. 

5 (6) ENGINE DOMINANT HYBRID ELECTRIC VE6 HICLE.—The term ‘‘engine dominant hybrid electric 

7 vehicle’’ means an on-road or nonroad vehicle that— 

8 (A) is propelled by an internal combustion 

9 engine or heat engine using— 

10 (i) any combustible fuel; and 

11 (ii) an on-board, rechargeable storage 

12 device; and 

13 (B) has no means of using an off-board 

14 source of electricity. 

15 (7) FUEL CELL VEHICLE.—The term ‘‘fuel cell 

16 vehicle’’ means an on-road or nonroad vehicle that 

17 uses a fuel cell (as defined in section 803 of the 

18 Spark M. Matsunaga Hydrogen Act of 2005 (42 

19 U.S.C. 16152)). 

20 (8) MILITARY MISSION LINE.—The term ‘‘Mili21 tary Mission Line’’ means the north-south line at 

22 86°41′ W. longitude. 

23 (9) NATIONAL TRANSMISSION GRID.—The term 

24 ‘‘national transmission grid’’ means new overlaying 

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1 mission facilities in the United States necessary for 

2 integrating and operating with the existing trans3 mission grid. 

4 (10) NORTH AMERICAN TRANSMISSION GRID.— 

5 The term ‘‘North American transmission grid’’ 

6 means new overlaying facilities or upgrades to exist7 ing interstate transmission facilities in North Amer8 ica necessary for integrating and operating with the 

9 existing transmission grid. 

10 (11) NONROAD VEHICLE.—The term ‘‘nonroad 

11 vehicle’’ has the meaning given the term in section 

12 216 of the Clean Air Act (42 U.S.C. 7550). 

13 (12) 181 AREA.—The term ‘‘181 Area’’ means 

14 the area identified in map 15, page 58, of the Pro15 posed Final Outer Continental Shelf Oil and Gas 

16 Leasing Program for 1997–2002 of the Minerals 

17 Management Service. 

18 (13) PLUG-IN HYBRID ELECTRIC VEHICLE.— 

19 The term ‘‘plug-in hybrid electric vehicle’’ means an 

20 on-road or nonroad vehicle that is propelled by an 

21 internal combustion engine or heat engine that— 

22 (A) uses— 

23 (i) any combustible fuel; and 

24 (ii) an on-board, rechargeable storage 

25 device; and 


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1 (B) has a means of using an off-board 

2 source of electricity. 

3 (14) PLUG-IN HYBRID FUEL CELL VEHICLE.— 

4 The term ‘‘plug-in hybrid fuel cell vehicle’’ means a 

5 fuel cell vehicle with a battery powered by an off6 board source of electricity. 

7 (15) SECRETARY.—The term ‘‘Secretary’’ 

8 means the Secretary of Energy. 

9 TITLE I—VEHICLE FUEL 

10 ECONOMY 

11 SEC. 101. NATIONAL AUTOMOBILE FUEL EFFICIENCY RE12 BATE PROGRAM. 

13 (a) IN GENERAL.—Chapter 329 of title 49, United 

14 States Code, is amended— 

15 (1) in section 32901(a)— 

16 (A) by redesignating paragraphs (10) 

17 through (16) as paragraphs (14) through (20), 

18 respectively; 

19 (B) by redesignating paragraphs (7) 

20 through (9) as paragraphs (10) through (12), 

21 respectively; 

22 (C) by inserting after paragraph (6) the 

23 following: 

24 ‘‘(7) ‘baseline fuel consumption level’ is cal25 culated by dividing 1 by the baseline fuel economy; 


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1 ‘‘(8) ‘baseline fuel economy’, for a particular 

2 class of vehicle in a particular model year, means 

3 110 percent of the combined average fuel economy 

4 for such class of vehicle in the previous model year; 

5 ‘‘(9) ‘combined average fuel economy’ means— 

6 ‘‘(A) as applied to automobiles (except pas7 senger automobiles), the weighted average fuel 

8 economy of all manufacturers calculated under 

9 section 32904(a)(1)(A); and 

10 ‘‘(B) as applied to passenger automobiles, 

11 the weighted average fuel economy of all manu12 facturers calculated under section 

13 32904(a)(1)(B), 

14 except that such calculation shall be determined on 

15 a gallons per mile basis, and in the case of dual 

16 fueled automobiles, the calculation of average fuel 

17 economy shall not be adjusted as set forth under 

18 section 32905(b);’’; and 

19 (D) by inserting after paragraph (12), as 

20 redesignated, the following: 

21 ‘‘(13) ‘fuel consumption level’ is calculated by 

22 dividing 1 by the fuel economy’’; and 

23 (2) by inserting after section 32903 the fol24 lowing: 


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1 ‘‘SEC. 32903A. REBATES FOR REDUCING FUEL CONSUMP2 TION LEVELS. 

3 ‘‘(a) ELIGIBILITY.—A consumer is eligible for a re4 bate under this section if the consumer originally places 

5 an automobile into service in the United States that at6 tains or exceeds the baseline fuel economy. 

7 ‘‘(b) REBATE AMOUNT.—An eligible consumer who 

8 submits a rebate request to the Secretary of the Transpor9 tation, in accordance with the regulations promulgated 

10 pursuant to subsection (c), shall be awarded a rebate in 

11 an amount equal to— 

12 ‘‘(1) $500, if the automobile placed in service 

13 by the consumer has a fuel consumption level that 

14 equals the baseline fuel consumption level or is lower 

15 than the baseline fuel consumption level by less than 

16 0.005 gallons per mile; 

17 ‘‘(2) $1,000, if the automobile placed in service 

18 by the consumer has a fuel consumption level that 

19 is lower than the baseline fuel consumption level by 

20 at least 0.005 gallons per mile and less than 0.010 

21 gallons per mile; 

22 ‘‘(3) $1,500, if the automobile placed in service 

23 by the consumer has a fuel consumption level that 

24 is lower than the baseline fuel consumption level by 

25 at least 0.010 gallons per mile and less than 0.015 

26 gallons per mile; 


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1 ‘‘(4) $2,000, if the automobile placed in service 

2 by the consumer has a fuel consumption level that 

3 is lower than the baseline fuel consumption level by 

4 at least 0.015 gallons per mile and less than 0.020 

5 gallons per mile; and 

6 ‘‘(5) $2,500, if the automobile placed in service 

7 by the consumer has a fuel consumption level that 

8 is lower than the baseline fuel consumption level by 

9 at least 0.020 gallons per mile. 

10 For purposes of this subsection, the Secretary shall cal11 culate fuel economy based on a gallons per mile standard. 

12 ‘‘(c) RULEMAKING.— 

13 ‘‘(1) IN GENERAL.—The Secretary of Transpor14 tation shall promulgate regulations to carry out this 

15 section. 

16 ‘‘(2) REBATE NOTICES.—In promulgating regu17 lations pursuant to this subsection, the Secretary of 

18 Transportation shall ensure that— 

19 ‘‘(A) information about the rebates avail20 able under this section is provided to the public, 

21 expressed in miles per gallon; 

22 ‘‘(B) a notice of the amount of the rebate 

23 available under this section is posted on each 

24 automobile that qualifies for such rebate; and 


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1 ‘‘(C) a rebate check in an amount deter2 mined under subsection (b) is sent directly to 

3 each consumer who demonstrates eligibility 

4 under subsection (a).’’. 

5 (b) COORDINATION WITH VEHICLE TAX CREDITS.— 

6 (1) ALTERNATIVE MOTOR VEHICLE TAX CRED7 IT.—Section 30B(h) of the Internal Revenue Code of 

8 1986 is amended by adding at the end the following 

9 new paragraph: 

10 ‘‘(11) COORDINATION WITH REBATES.—No 

11 credit shall be allowed under this section to any tax12 payer with respect to any motor vehicle if such tax13 payer receives a rebate under section 32903A of title 

14 49, United States Code.’’. 

15 (2) CREDIT FOR QUALIFIED ELECTRIC VEHI16 CLES.—Section 30(d) of the Internal Revenue Code 

17 of 1986 is amended by adding at the end the fol18 lowing new paragraph: 

19 ‘‘(5) COORDINATION WITH REBATES.—No cred20 it shall be allowed under this section to any taxpayer 

21 with respect to any motor vehicle if such taxpayer 

22 receives a rebate under section 32903A of title 49, 

23 United States Code.’’. 

24 (c) STUDY.— 


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1 (1) IN GENERAL.—The Secretary of Transpor2 tation shall undertake a study to compare and evalu3 ate the effectiveness of the rebates under section 

4 32903A of title 49, United States Code, and the 

5 credits under sections 30 and 30B of the Internal 

6 Revenue Code of 1986. The study shall include— 

7 (A) an evaluation of the rebates under 

8 such section 32903A and the effectiveness of 

9 such rebates in improving the average fuel 

10 economy of automobiles purchased in the 

11 United States; and 

12 (B) an evaluation of the credits under such 

13 sections 30 and 30B and the effectiveness of 

14 such credits in increasing purchases of electric 

15 vehicles, new qualified hybrid vehicles, and ad16 vanced lean burn technology vehicles. 

17 (2) REPORT.—Not later than December 31, 

18 2009, the Secretary of Transportation shall transmit 

19 to the President and to Congress a written report 

20 presenting the results of the study conducted pursu21 ant to this subsection. The report shall include— 

22 (A) recommendations for changes in the 

23 rebate structure under such section 32903A to 

24 further improve the average fuel economy of 

25 automobiles purchased in the United States; 


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1 (B) recommendations for changes in the 

2 credits under such sections 30 and 30B to fur3 ther increase the purchases of alternative fuel 

4 and lean burn technology vehicles that lessen 

5 the United States dependence on imported for6 eign oil; and 

7 (C) recommendations for consolidating 

8 such rebates and credits into one unified incen9 tive structure for the purchase of automobiles 

10 that will further reduce such dependence. 

11 (d) CLERICAL AMENDMENT.—The table of sections 

12 in chapter 329 of title 49, United States Code, is amended 

13 by inserting after the item relating to section 32903 the 

14 following: 

‘‘Sec. 32903A. Rebates for reducing fuel consumption levels.’’. 

15 SEC. 102. RESEARCH AND DEVELOPMENT PROGRAM FOR 

16 LIGHTWEIGHT MATERIALS. 

17 There are authorized to be appropriated to the Sec18 retary for research and development relating to carbon19 fiber composites and lightweight steel alloys to reduce the 

20 weight of automobiles— 

21 (1) $33,750,000 for fiscal year 2007; 

22 (2) $40,000,000 for fiscal year 2008; 

23 (3) $47,250,000 for fiscal year 2009; 

24 (4) $54,000,000 for fiscal year 2010; and 

25 (5) $60,000,000 for fiscal year 2011. 


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1 SEC. 103. TIRE EFFICIENCY PROGRAM. 

2 (a) STANDARDS FOR TIRES MANUFACTURED FOR

3 INTERSTATE COMMERCE.—Section 30123 of title 49, 

4 United States Code, is amended— 

5 (1) in subsection (b)— 

6 (A) in the first sentence, by striking ‘‘The 

7 Secretary’’ and inserting the following: 

8 ‘‘(1) UNIFORM QUALITY GRADING SYSTEM.— 

9 The Secretary’’; 

10 (B) in the second sentence, by striking 

11 ‘‘The Secretary’’ and inserting the following: 

12 ‘‘(2) NOMENCLATURE AND MARKETING PRAC13 TICES.—The Secretary’’; 

14 (C) in the third sentence, by striking ‘‘A 

15 tire standard’’ and inserting the following: 

16 ‘‘(3) EFFECT OF STANDARDS AND REGULA17 TIONS.—A tire standard’’; and 

18 (2) by adding at the end the following: 

19 ‘‘(d) NATIONAL TIRE EFFICIENCY PROGRAM.— 

20 ‘‘(1) DEFINITION.—In this subsection, the term 

21 ‘tire efficiency’, with respect to a tire, means the ex22 tent to which the tire contributes to the fuel econ23 omy of the motor vehicle on which the tire is mount24 ed. 

25 ‘‘(2) PROGRAM.—The Secretary shall develop 

26 and carry out a national tire efficiency program for 


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1 tires designed for use on passenger cars and light 

2 trucks. 

3 ‘‘(3) REQUIREMENTS.—Not later than March 

4 31, 2007, the Secretary shall issue regulations, 

5 which establish— 

6 ‘‘(A) policies and procedures for testing 

7 and labeling tires for fuel economy to enable 

8 tire buyers to make informed purchasing deci9 sions about the fuel economy of tires; and 

10 ‘‘(B) policies and procedures to promote 

11 the purchase of energy efficient replacement 

12 tires, including purchase incentives, website list13 ings on the Internet, printed fuel economy 

14 guide booklets, and mandatory requirements for 

15 tire retailers to provide tire buyers with fuel ef16 ficiency information on tires. 

17 ‘‘(4) APPLICABILITY.—The policies, procedures, 

18 and standards developed under paragraph (3) shall 

19 apply to all tire types and models regulated under 

20 the uniform tire quality grading standards in section 

21 575.104 of title 49, Code of Federal Regulations, as 

22 in effect on the date of enactment of this Act (or a 

23 successor regulation). 

24 ‘‘(5) NO PREEMPTION OF STATE LAW.—Noth25 ing in this section shall be construed to preempt any 


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1 provision of State law relating to higher fuel econ2 omy standards applicable to replacement tires de3 signed for use on passenger cars and light trucks. 

4 ‘‘(6) EXCEPTIONS.—Nothing in this section 

5 shall apply to— 

6 ‘‘(A) a tire or group of tires with the same 

7 stock keeping unit, plant, and year, for which 

8 the volume of tires produced or imported is less 

9 than 15,000 annually; 

10 ‘‘(B) a deep tread, winter-type snow tire, 

11 space-saver tire, or temporary use spare tire; 

12 ‘‘(C) a tire with a normal rim diameter of 

13 12 inches or less; 

14 ‘‘(D) a motorcycle tire; or 

15 ‘‘(E) a tire manufactured specifically for 

16 use in an off-road motorized recreational vehi17 cle.’’. 

18 (b) CONFORMING AMENDMENT.—Section 

19 30103(b)(1) of title 49, United States Code, is amended 

20 by striking ‘‘When’’ and inserting ‘‘Except as provided in 

21 section 30123(d), if’’. 

22 (c) TIME FOR IMPLEMENTATION.—Beginning not 

23 later than March 31, 2007, the Secretary of Transpor24 tation shall administer the national tire efficiency program 

25 established under section 30123(d) of title 49, United 


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1 States Code, in accordance with the policies, procedures, 

2 and standards developed under section 30123(d)(3) of 

3 such title. 

4 (d) AUTHORIZATION OF APPROPRIATIONS.—There 

5 are authorized to be appropriated, for each of the fiscal 

6 years 2007 through 2011, such sums as may be necessary 

7 to carry out section 30123(d) of title 49, United States 

8 Code, as added by subsection (a). 

9 SEC. 104. IDLING REDUCTION TAX CREDIT. 

10 (a) IN GENERAL.—Subpart D of part IV of sub11 chapter A of chapter 1 of the Internal Revenue Code of 

12 1986 (relating to business-related credits) is amended by 

13 adding at the end the following new section: 

14 ‘‘SEC. 45N. IDLING REDUCTION CREDIT. 

15 ‘‘(a) GENERAL RULE.—For purposes of section 38, 

16 the idling reduction tax credit determined under this sec17 tion for the taxable year is an amount equal to 25 percent 

18 of the amount paid or incurred for each qualifying idling 

19 reduction device placed in service by the taxpayer during 

20 the taxable year. 

21 ‘‘(b) LIMITATION.—The maximum amount allowed as 

22 a credit under subsection (a) shall not exceed $1,000 per 

23 device. 

24 ‘‘(c) DEFINITIONS.—For purposes of subsection 

25 (a)— 


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1 ‘‘(1) QUALIFYING IDLING REDUCTION DE2 VICE.—The term ‘qualifying idling reduction device’ 

3 means any device or system of devices that— 

4 ‘‘(A) is installed on a heavy-duty diesel5 powered on-highway vehicle, 

6 ‘‘(B) is designed to provide to such vehicle 

7 those services (such as heat, air conditioning, or 

8 electricity) that would otherwise require the op9 eration of the main drive engine while the vehi10 cle is temporarily parked or remains stationary, 

11 ‘‘(C) the original use of which commences 

12 with the taxpayer, 

13 ‘‘(D) is acquired for use by the taxpayer 

14 and not for resale, and 

15 ‘‘(E) is certified by the Secretary of En16 ergy, in consultation with the Administrator of 

17 the Environmental Protection Agency and the 

18 Secretary of Transportation, to reduce long-du19 ration idling of such vehicle at a motor vehicle 

20 rest stop or other location where such vehicles 

21 are temporarily parked or remain stationary. 

22 ‘‘(2) HEAVY-DUTY DIESEL-POWERED ON-HIGH23 WAY VEHICLE.—The term ‘heavy-duty diesel-pow24 ered on-highway vehicle’ means any vehicle, ma25 chine, tractor, trailer, or semi-trailer propelled or 


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1 drawn by mechanical power and used upon the high2 ways in the transportation of passengers or prop3 erty, or any combination thereof determined by the 

4 Federal Highway Administration. 

5 ‘‘(3) LONG-DURATION IDLING.—The term ‘long6 duration idling’ means the operation of a main drive 

7 engine, for a period greater than 15 consecutive 

8 minutes, where the main drive engine is not engaged 

9 in gear. Such term does not apply to routine stop10 pages associated with traffic movement or conges11 tion. 

12 ‘‘(d) NO DOUBLE BENEFIT.—For purposes of this 

13 section— 

14 ‘‘(1) REDUCTION IN BASIS.—If a credit is de15 termined under this section with respect to any 

16 property by reason of expenditures described in sub17 section (a), the basis of such property shall be re18 duced by the amount of the credit so determined. 

19 ‘‘(2) OTHER DEDUCTIONS AND CREDITS.—No 

20 deduction or credit shall be allowed under any other 

21 provision of this chapter with respect to the amount 

22 of the credit determined under this section. 

23 ‘‘(e) ELECTION NOT TO CLAIM CREDIT.—This sec24 tion shall not apply to a taxpayer for any taxable year 


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1 if such taxpayer elects to have this section not apply for 

2 such taxable year.’’. 

3 (b) CREDIT TO BE PART OF GENERAL BUSINESS

4 CREDIT.—Subsection (b) of section 38 of the Internal 

5 Revenue Code of 1986 (relating to general business credit) 

6 is amended by striking ‘‘and’’ at the end of paragraph 

7 (29), by striking the period at the end of paragraph (30) 

8 and inserting ‘‘, plus’’ , and by adding at the end the fol9 lowing new paragraph: 

10 ‘‘(31) the idling reduction tax credit determined 

11 under section 45N(a).’’. 

12 (c) CONFORMING AMENDMENTS.— 

13 (1) The table of sections for subpart D of part 

14 IV of subchapter A of chapter 1 of the Internal Rev15 enue Code of 1986 is amended by inserting after the 

16 item relating to section 45M the following new item: 

‘‘Sec. 45N. Idling reduction credit.’’. 

17 (2) Section 1016(a) of such Code is amended 

18 by striking ‘‘and’’ at the end of paragraph (36), by 

19 striking the period at the end of paragraph (37) and 

20 inserting ‘‘, and’’, and by adding at the end the fol21 lowing: 

22 ‘‘(38) in the case of a facility with respect to 

23 which a credit was allowed under section 45N, to the 

24 extent provided in section 45N(d)(A).’’. 


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1 (3) Section 6501(m) of such Code is amended 

2 by inserting ‘‘45N(e),’’ after ‘‘45D(c)(4),’’. 

3 (d) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply to taxable years beginning after 

5 December 31, 2006. 

6 (e) DETERMINATION OF CERTIFICATION STANDARDS

7 BY SECRETARY OF ENERGY FOR CERTIFYING IDLING RE8 DUCTION DEVICES.—Not later than 6 months after the 

9 date of the enactment of this Act and in order to reduce 

10 air pollution and fuel consumption, the Secretary of En11 ergy, in consultation with the Administrator of the Envi12 ronmental Protection Agency and the Secretary of Trans13 portation, shall publish the standards under which the 

14 Secretary, in consultation with the Administrator of the 

15 Environmental Protection Agency and the Secretary of 

16 Transportation, will, for purposes of section 45N of the 

17 Internal Revenue Code of 1986 (as added by this section), 

18 certify the idling reduction devices which will reduce long19 duration idling of vehicles at motor vehicle rest stops or 

20 other locations where such vehicles are temporarily parked 

21 or remain stationary in order to reduce air pollution and 

22 fuel consumption. 


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1 TITLE II—ALTERNATIVE FUEL 

2 VEHICLES 

3 SEC. 201. PROMOTION OF ADVANCED TECHNOLOGY MOTOR 

4 VEHICLES. 

5 (a) PURPOSES.—It is the purpose of this section— 

6 (1) to facilitate the production of advanced 

7 technology motor vehicles capable of lessening our 

8 dependence on foreign oil, and 

9 (2) to ensure that domestic and foreign auto10 makers receive adequate incentives in the form of a 

11 manufacturing tax credit or equivalent employee 

12 healthcare cost relief to meet the vehicle fleet re13 quirements established under subsection (b). 

14 (b) PRODUCTION REQUIREMENTS.—Section 32905 

15 of title 49, United States Code, is amended by adding at 

16 the end the following: 

17 ‘‘(h) ALTERNATIVE FUELED AUTOMOBILES.—Each 

18 manufacturer that manufactures automobiles for sale or 

19 use in the United States shall ensure that— 

20 ‘‘(1) beginning in model year 2011, not less 

21 than 30 percent of such automobiles are advanced 

22 technology motor vehicles (as defined in section 

23 30D(c)(1) of the Internal Revenue Code of 1986); 

24 and 


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1 ‘‘(2) beginning in model year 2017, all such 

2 automobiles are advanced technology motor vehicles 

3 (as so defined).’’. 

4 (c) INCENTIVES FOR PRODUCTION REQUIRE5 MENTS.— 

6 (1) ADVANCED TECHNOLOGY MOTOR VEHICLES

7 MANUFACTURING CREDIT.— 

8 (A) IN GENERAL.—Subpart B of part IV 

9 of subchapter A of chapter 1 of the Internal 

10 Revenue Code of 1986 (relating to foreign tax 

11 credit, etc.) is amended by adding at the end 

12 the following new section: 

13 ‘‘SEC. 30D. ADVANCED TECHNOLOGY MOTOR VEHICLES 

14 MANUFACTURING CREDIT. 

15 ‘‘(a) CREDIT ALLOWED.— 

16 ‘‘(1) IN GENERAL.—There shall be allowed as a 

17 credit against the tax imposed by this chapter for 

18 the taxable year an amount equal to 35 percent of 

19 the qualified investment of an eligible taxpayer for 

20 such taxable year. 

21 ‘‘(2) LIMITATION.—The amount of the credit 

22 allowed under paragraph (1) for any taxable year 

23 shall not exceed $250,000,000. 

24 ‘‘(b) QUALIFIED INVESTMENT.—For purposes of this 

25 section— 


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1 ‘‘(1) IN GENERAL.—The qualified investment 

2 for any taxable year is equal to the incremental costs 

3 incurred during such taxable year— 

4 ‘‘(A) to re-equip, expand, or establish any 

5 manufacturing facility of the eligible taxpayer 

6 to produce advanced technology motor vehicles 

7 or to produce eligible components, 

8 ‘‘(B) for engineering integration of such 

9 vehicles and components as described in sub10 section (d), 

11 ‘‘(C) for research and development related 

12 to advanced technology motor vehicles and eligi13 ble components, and 

14 ‘‘(D) for employee retraining with respect 

15 to the manufacturing of such vehicles or compo16 nents (determined without regard to wages or 

17 salaries of such retrained employees). 

18 ‘‘(2) ATTRIBUTION RULES.—In the event a fa19 cility of the eligible taxpayer produces both advanced 

20 technology motor vehicles and conventional motor 

21 vehicles, or eligible and non-eligible components, only 

22 the qualified investment attributable to production 

23 of advanced technology motor vehicles and eligible 

24 components shall be taken into account. 


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1 ‘‘(c) ADVANCED TECHNOLOGY MOTOR VEHICLES

2 AND ELIGIBLE COMPONENTS.—For purposes of this sec3 tion— 

4 ‘‘(1) ADVANCED TECHNOLOGY MOTOR VEHI5 CLE.—The term ‘advanced technology motor vehicle’ 

6 means— 

7 ‘‘(A) any qualified electric vehicle (as de8 fined in section 30(c)(1)), 

9 ‘‘(B) any new qualified fuel cell motor ve10 hicle (as defined in section 30B(b)(3)), 

11 ‘‘(C) any new advanced lean burn tech12 nology motor vehicle (as defined in section 

13 30B(c)(3)), 

14 ‘‘(D) any new qualified hybrid motor vehi15 cle (as defined in section 30B(d)(2)(A) and de16 termined without regard to any gross vehicle 

17 weight rating), 

18 ‘‘(E) any new qualified alternative fuel 

19 motor vehicle (as defined in section 30B(e)(4), 

20 including any mixed-fuel vehicle (as defined in 

21 section 30B(e)(5)(B)), and 

22 ‘‘(F) any other motor vehicle using electric 

23 drive transportation technology (as defined in 

24 section 201(2) of the Breaking Our Long-Term 

25 Dependence Energy Act of 2006). 


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1 ‘‘(2) ELIGIBLE COMPONENTS.—The term ‘eligi2 ble component’ means any component inherent to 

3 any advanced technology motor vehicle, including— 

4 ‘‘(A) with respect to any gasoline or diesel5 electric new qualified hybrid motor vehicle— 

6 ‘‘(i) electric motor or generator, 

7 ‘‘(ii) power split device, 

8 ‘‘(iii) power control unit, 

9 ‘‘(iv) power controls, 

10 ‘‘(v) integrated starter generator, or 

11 ‘‘(vi) battery, 

12 ‘‘(B) with respect to any hydraulic new 

13 qualified hybrid motor vehicle— 

14 ‘‘(i) hydraulic accumulator vessel, 

15 ‘‘(ii) hydraulic pump, or 

16 ‘‘(iii) hydraulic pump-motor assembly, 

17 ‘‘(C) with respect to any new advanced 

18 lean burn technology motor vehicle— 

19 ‘‘(i) diesel engine, 

20 ‘‘(ii) turbocharger, 

21 ‘‘(iii) fuel injection system, or 

22 ‘‘(iv) after-treatment system, such as 

23 a particle filter or NOx absorber, and 


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1 ‘‘(D) with respect to any advanced tech2 nology motor vehicle, any other component sub3 mitted for approval by the Secretary. 

4 ‘‘(d) ENGINEERING INTEGRATION COSTS.—For pur5 poses of subsection (b)(1)(B), costs for engineering inte6 gration are costs incurred prior to the market introduction 

7 of advanced technology vehicles for engineering tasks re8 lated to— 

9 ‘‘(1) establishing functional, structural, and 

10 performance requirements for component and sub11 systems to meet overall vehicle objectives for a spe12 cific application, 

13 ‘‘(2) designing interfaces for components and 

14 subsystems with mating systems within a specific ve15 hicle application, 

16 ‘‘(3) designing cost effective, efficient, and reli17 able manufacturing processes to produce components 

18 and subsystems for a specific vehicle application, 

19 and 

20 ‘‘(4) validating functionality and performance of 

21 components and subsystems for a specific vehicle ap22 plication. 

23 ‘‘(e) ELIGIBLE TAXPAYER.—For purposes of this sec24 tion, the term ‘eligible taxpayer’ means any taxpayer— 


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1 ‘‘(1) for which more than 50 percent of its 

2 gross receipts for the taxable year is derived from 

3 the manufacture of motor vehicles or any component 

4 parts of such vehicles, and 

5 ‘‘(2) which has not submitted an application for 

6 financial assistance under the program established 

7 under section 201(b)(2) of the Breaking Our Long8 Term Dependence Energy Act of 2006. 

9 ‘‘(f) LIMITATION BASED ON AMOUNT OF TAX.—The 

10 credit allowed under subsection (a) for the taxable year 

11 shall not exceed the excess of— 

12 ‘‘(1) the sum of— 

13 ‘‘(A) the regular tax liability (as defined in 

14 section 26(b)) for such taxable year, plus 

15 ‘‘(B) the tax imposed by section 55 for 

16 such taxable year and any prior taxable year 

17 beginning after 1986 and not taken into ac18 count under section 53 for any prior taxable 

19 year, over 

20 ‘‘(2) the sum of the credits allowable under sub21 part A and sections 27, 30, and 30B for the taxable 

22 year. 

23 ‘‘(g) REDUCTION IN BASIS.—For purposes of this 

24 subtitle, if a credit is allowed under this section for any 

25 expenditure with respect to any property, the increase in 


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1 the basis of such property which would (but for this para2 graph) result from such expenditure shall be reduced by 

3 the amount of the credit so allowed. 

4 ‘‘(h) NO DOUBLE BENEFIT.— 

5 ‘‘(1) COORDINATION WITH OTHER DEDUCTIONS

6 AND CREDITS.—Except as provided in paragraph 

7 (2), the amount of any deduction or other credit al8 lowable under this chapter for any cost taken into 

9 account in determining the amount of the credit 

10 under subsection (a) shall be reduced by the amount 

11 of such credit attributable to such cost. 

12 ‘‘(2) RESEARCH AND DEVELOPMENT COSTS.— 

13 ‘‘(A) IN GENERAL.—Except as provided in 

14 subparagraph (B), any amount described in 

15 subsection (b)(1)(C) taken into account in de16 termining the amount of the credit under sub17 section (a) for any taxable year shall not be 

18 taken into account for purposes of determining 

19 the credit under section 41 for such taxable 

20 year. 

21 ‘‘(B) COSTS TAKEN INTO ACCOUNT IN DE22 TERMINING BASE PERIOD RESEARCH EX23 PENSES.—Any amounts described in subsection 

24 (b)(1)(C) taken into account in determining the 

25 amount of the credit under subsection (a) for 


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1 any taxable year which are qualified research 

2 expenses (within the meaning of section 41(b)) 

3 shall be taken into account in determining base 

4 period research expenses for purposes of apply5 ing section 41 to subsequent taxable years. 

6 ‘‘(i) BUSINESS CARRYOVERS ALLOWED.—If the cred7 it allowable under subsection (a) for a taxable year exceeds 

8 the limitation under subsection (f) for such taxable year, 

9 such excess (to the extent of the credit allowable with re10 spect to property subject to the allowance for depreciation) 

11 shall be allowed as a credit carryback and carryforward 

12 under rules similar to the rules of section 39. 

13 ‘‘(j) SPECIAL RULES.—For purposes of this section, 

14 rules similar to the rules of paragraphs (4) and (5) of sec15 tion 179A(e) and paragraphs (1) and (2) of section 41(f) 

16 shall apply 

17 ‘‘(k) ELECTION NOT TO TAKE CREDIT.—No credit 

18 shall be allowed under subsection (a) for any property if 

19 the taxpayer elects not to have this section apply to such 

20 property. 

21 ‘‘(l) REGULATIONS.—The Secretary shall prescribe 

22 such regulations as necessary to carry out the provisions 

23 of this section. 

24 ‘‘(m) TERMINATION.—This section shall not apply to 

25 any qualified investment after December 31, 2015.’’. 


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1 (B) CONFORMING AMENDMENTS.— 

2 (i) Section 1016(a) of the Internal 

3 Revenue Code of 1986, as amended by this 

4 Act, is amended by striking ‘‘and’’ at the 

5 end of paragraph (37), by striking the pe6 riod at the end of paragraph (38) and in7 serting ‘‘, and’’, and by adding at the end 

8 the following new paragraph: 

9 ‘‘(39) to the extent provided in section 

10 30D(g).’’. 

11 (ii) Section 6501(m) of such Code, as 

12 amended by this Act, is amended by insert13 ing ‘‘30D(k),’’ after ‘‘30C(e)(5),’’. 

14 (iii) The table of sections for subpart 

15 B of part IV of subchapter A of chapter 1 

16 of such Code is amended by inserting after 

17 the item relating to section 30C the fol18 lowing new item: 

‘‘Sec. 30D. Advanced technology motor vehicles manufacturing credit.’’. 

19 (C) EFFECTIVE DATE.—The amendments 

20 made by this paragraph shall apply to amounts 

21 incurred in taxable years beginning after De22 cember 31, 2006. 

23 (2) ADVANCED TECHNOLOGY MOTOR VEHICLE

24 MANUFACTURER HEALTHCARE RELIEF PROGRAM.— 


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1 (A) COORDINATING TASK FORCE.—Not 

2 later than 6 months after the date of enactment 

3 of this Act, the Secretary of Energy, the Sec4 retary of Health and Human Services, the Sec5 retary of Transportation, and the Secretary of 

6 the Treasury shall establish, and appoint an 

7 equal number of representatives to, a task force 

8 (referred to in this paragraph as the ‘‘task 

9 force’’) to administer the program established 

10 under this paragraph. 

11 (B) ESTABLISHMENT OF PROGRAM.— 

12 (i) IN GENERAL.—Not later than 1 

13 year after the date of enactment of this 

14 Act, the task force established under sub15 paragraph (A) shall establish a program to 

16 provide financial assistance to eligible do17 mestic automobile manufacturers for the 

18 costs incurred in providing health benefits 

19 to their retired employees. 

20 (ii) CONSULTATION.—In establishing 

21 the program under clause (i), the task 

22 force shall consult with representatives 

23 from the domestic automobile manufactur24 ers, unions representing employees of such 


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•S 2571 IS

1 manufacturers, and consumer and environ2 mental groups. 

3 (C) ELIGIBLE DOMESTIC AUTOMOBILE

4 MANUFACTURER.—To be eligible to receive fi5 nancial assistance under the program estab6 lished under subparagraph (B), a domestic 

7 automobile manufacturer shall— 

8 (i) submit an application to the task 

9 force at such time, in such manner, and 

10 containing such information as the task 

11 force shall require; 

12 (ii) certify that such manufacturer is 

13 providing full health care coverage to all of 

14 its domestic employees; 

15 (iii) certify that such manufacturer— 

16 (I) has not elected the credit al17 lowed under section 30D of the Inter18 nal Revenue Code of 1986, and 

19 (II) but for such nonelection, 

20 would be an eligible taxpayer for pur21 poses of such credit under section 

22 30D(e)(1) of such Code; and 

23 (iv) provide additional assurances and 

24 information as the task force may require, 

25 including information needed by the task 


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•S 2571 IS

1 force to audit the manufacturer’s compli2 ance with the requirements of the pro3 gram. 

4 (D) LIMITATION.—The total amount of fi5 nancial assistance that may be provided each 

6 year under the program under subparagraph 

7 (B) with respect to any single domestic auto8 mobile manufacturer shall not exceed an 

9 amount equal to the lesser of— 

10 (i) the lesser of — 

11 (I) 35 percent of the qualified in12 vestment of such manufacturer for 

13 such year (as determined under sec14 tion 30D(b) of such Code without re15 gard to the limitation under section 

16 30D(f) of such Code), or 

17 (II) the aggregate retiree health 

18 care expenditures for such manufac19 turer, or 

20 (ii) $250,000,000. 

21 (E) APPLICATION OF CERTAIN RULES.— 

22 Rules similar to the rules under subsections (g) 

23 and (h) of section 30D of such Code shall apply 

24 with respect to any qualified investment used to 


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•S 2571 IS

1 determine the financial assistance provided 

2 under the program under subparagraph (B). 

3 (F) AUTHORIZATION OF APPROPRIA4 TIONS.—There are authorized to be appro5 priated, such sums as may be necessary in each 

6 fiscal year to carry out this paragraph. 

7 (G) LIMITATION ON BACKSLIDING.—To be 

8 eligible to receive financial assistance under 

9 subparagraph (B), a manufacturer shall provide 

10 assurances to the task force that fuel savings 

11 achieved with respect its average adjusted fuel 

12 economy will not result in decreases with re13 spect to fuel economy elsewhere in the domestic 

14 fleet. The task force shall determine compliance 

15 with such assurances using accepted measure16 ments of fuel savings. 

17 (H) TERMINATION OF PROGRAM.—The 

18 program established under subparagraph (B) 

19 shall terminate on December 31, 2015. 

20 SEC. 202. RESEARCH AND DEVELOPMENT PROGRAM FOR 

21 NEW VEHICLE TECHNOLOGIES. 

22 (a) PURPOSES.—The purposes of this section are— 

23 (1) to enable and promote, in partnership with 

24 industry, comprehensive development, demonstra25 tion, and commercialization of a wide range of elecVerDate Aug 31 2005 21:34 Apr 14, 2006 Jkt 049200 PO 00000 Frm 00036 Fmt 6652 Sfmt 6201 E:\BILLS\S2571.IS S2571

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•S 2571 IS

1 tric drive components, systems, and vehicles using 

2 diverse electric drive transportation technologies; 

3 (2) to make critical public investments to help 

4 private industry, institutions of higher education, 

5 National Laboratories, and research institutions to 

6 expand innovation, industrial growth, and jobs in the 

7 United States; 

8 (3) to expand the availability of the existing 

9 electric infrastructure for fueling light-duty trans10 portation vehicles and other on-road and nonroad ve11 hicles that are using petroleum and are mobile 

12 sources of emissions, with the goals of— 

13 (A) enhancing the energy security of the 

14 United States; 

15 (B) reducing dependence on imported oil; 

16 and 

17 (C) reducing emissions through the expan18 sion of grid supported mobility; 

19 (4) to accelerate the widespread commercializa20 tion of electric drive vehicle technology into all sizes 

21 and applications of vehicles, including commer22 cialization of plug-in hybrid electric vehicles and 

23 plug-in hybrid fuel cell vehicles; and 

24 (5) to improve the energy efficiency of and re25 duce the petroleum use in transportation. 


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1 (b) PROGRAM.—The Secretary shall conduct a pro2 gram of research, development, demonstration, and com3 mercial application for electric drive transportation tech4 nology, including— 

5 (1) high capacity, high-efficiency batteries; 

6 (2) high-efficiency on-board and off-board 

7 charging components; 

8 (3) high-powered drive train systems for pas9 senger and commercial vehicles and for nonroad 

10 equipment; 

11 (4) control system development and power train 

12 development and integration for plug-in hybrid elec13 tric vehicles, plug-in hybrid fuel cell vehicles, and en14 gine dominant hybrid electric vehicles, including— 

15 (A) development of efficient cooling sys16 tems; 

17 (B) analysis and development of control 

18 systems that minimize the emissions profile 

19 when clean diesel engines are part of a plug-in 

20 hybrid drive system; and 

21 (C) development of different control sys22 tems that optimize for different goals, includ23 ing— 

24 (i) battery life; 


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•S 2571 IS

1 (ii) reduction of petroleum consump2 tion; and 

3 (iii) green house gas reduction; 

4 (5) nanomaterial technology applied to both 

5 battery and fuel cell systems; 

6 (6) large-scale demonstrations, testing, and 

7 evaluation of plug-in hybrid electric vehicles in dif8 ferent applications with different batteries and con9 trol systems, including— 

10 (A) military applications; 

11 (B) mass market passenger and light-duty 

12 truck applications; 

13 (C) private fleet applications; and 

14 (D) medium- and heavy-duty applications; 

15 (7) development, in consultation with the Ad16 ministrator of the Environmental Protection Agency, 

17 of procedures for testing and certification of criteria 

18 pollutants, fuel economy, and petroleum use for 

19 light-, medium-, and heavy-duty vehicle applications, 

20 including consideration of— 

21 (A) the vehicle and fuel as a system, not 

22 just an engine; and 

23 (B) nightly off-board charging; and 


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1 (8) advancement of battery and corded electric 

2 transportation technologies in mobile source applica3 tions by— 

4 (A) improvement in battery, drive train, 

5 and control system technologies; and 

6 (B) working with industry and the Admin7 istrator of the Environmental Protection Agen8 cy to— 

9 (i) understand and inventory markets; 

10 and 

11 (ii) identify and implement methods of 

12 removing barriers for existing and emerg13 ing applications. 

14 (c) AUTHORIZATION OF APPROPRIATIONS.—There is 

15 authorized to be appropriated to carry out this section 

16 $300,000,000 for each of fiscal years 2007 through 2012. 

17 SEC. 203. CONSUMER INCENTIVES TO PURCHASE AD18 VANCED TECHNOLOGY VEHICLES. 

19 (a) ELIMINATION OF LIMITATION ON NUMBER OF

20 NEW QUALIFIED HYBRID AND ADVANCED LEAN BURN

21 TECHNOLOGY VEHICLES ELIGIBLE FOR ALTERNATIVE

22 MOTOR VEHICLE CREDIT.— 

23 (1) IN GENERAL.—Section 30B of the Internal 

24 Revenue Code of 1986 is amended by striking sub25 section (f) and by redesignating subsections (g) 


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•S 2571 IS

1 through (j) as subsections (f) through (i), respec2 tively. 

3 (2) CONFORMING AMENDMENTS.— 

4 (A) Paragraphs (4) and (6) of section 

5 30B(h) of the Internal Revenue Code of 1986 

6 are each amended by striking ‘‘(determined 

7 without regard to subsection (g))’’ and inserting 

8 ‘‘determined without regard to subsection (f))’’. 

9 (B) Section 38(b)(25) of such Code is 

10 amended by striking ‘‘section 30B(g)(1)’’ and 

11 inserting ‘‘section 30B(f)(1)’’. 

12 (C) Section 55(c)(2) of such Code is 

13 amended by striking ‘‘section 30B(g)(2)’’ and 

14 inserting ‘‘section 30B(f)(2)’’. 

15 (D) Section 1016(a)(36) of such Code is 

16 amended by striking ‘‘section 30B(h)(4)’’ and 

17 inserting ‘‘section 30B(g)(4)’’. 

18 (E) Section 6501(m) of such Code is 

19 amended by striking ‘‘section 30B(h)(9)’’ and 

20 inserting ‘‘section 30B(g)(9)’’. 

21 (b) EFFECTIVE DATE.—The amendments made by 

22 this section shall apply to property placed in service after 

23 December 31, 2005, in taxable years ending after such 

24 date. 


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•S 2571 IS

1 SEC. 204. EXTENSION OF FULL CREDIT FOR QUALIFIED 

2 ELECTRIC VEHICLES. 

3 (a) IN GENERAL.—Section 30(e) of the Internal Rev4 enue Code of 1986 is amended by striking ‘‘2006’’ and 

5 inserting ‘‘2010’’. 

6 (b) REPEAL OF PHASEOUT.—Section 30(b) of the In7 ternal Revenue Code of 1986 (relating to limitations) is 

8 amended by striking paragraph (2) and by redesignating 

9 paragraph (3) as paragraph (2). 

10 (c) CREDIT ALLOWABLE AGAINST ALTERNATIVE

11 MINIMUM TAX.—Paragraph (2) of section 30(b) of the In12 ternal Revenue Code of 1986, as redesignated by sub13 section (b), is amended to read as follows: 

14 ‘‘(2) APPLICATION WITH OTHER CREDITS.— 

15 The credit allowed by subsection (a) for any taxable 

16 year shall not exceed the excess (if any) of— 

17 ‘‘(A) the sum of the regular tax for the 

18 taxable year plus the tax imposed by section 55, 

19 over 

20 ‘‘(B) the sum of the credits allowable 

21 under subpart A and section 27.’’. 

22 (d) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to taxable years beginning after 

24 December 31, 2005. 


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1 TITLE III—ALTERNATIVE FUELS 

2 SEC. 301. BIOFUELS. 

3 (a) AUTHORIZATION OF APPROPRIATIONS.—Section 

4 931(c) of the Energy Policy Act of 2005 (42 U.S.C. 

5 16231(c)) is amended— 

6 (1) in paragraph (1), by striking 

7 ‘‘$213,000,000’’ and inserting ‘‘$251,000,000’’; 

8 (2) in paragraph (2)— 

9 (A) by striking ‘‘$251,000,000’’ and in10 serting ‘‘$270,000,000’’; and 

11 (B) by striking ‘‘and’’; 

12 (3) in paragraph (3)— 

13 (A) by striking ‘‘$274,000,000’’ and in14 serting ‘‘$294,000,000’’; and 

15 (B) by striking the period at the end and 

16 inserting a semicolon; and 

17 (4) by adding at the end the following: 

18 ‘‘(4) $318,000,000 for fiscal year 2010; and 

19 ‘‘(5) $343,000,000 for fiscal year 2011.’’. 

20 (b) DEFINITION OF BIOMASS.—Section 932(a)(1)(A) 

21 of the Energy Policy Act of 2005 (42 U.S.C. 

22 16232(a)(1)(A)) is amended by adding after ‘‘organic ma23 terial’’ the following: ‘‘(including sugarcane, sugar beets, 

24 sugar components, and cellulose)’’. 


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1 SEC. 302. CONTINUATION OF BIOENERGY PROGRAM. 

2 Section 9010(c) of the Farm Security and Rural In3 vestment Act of 2002 (7 U.S.C. 8108(c)) is amended— 

4 (1) by striking ‘‘section—’’ and all that follows 

5 through ‘‘not more than’’ and inserting ‘‘section not 

6 more than’’; and 

7 (2) by striking ‘‘2006;’’ and all that follows and 

8 inserting ‘‘2007.’’. 

9 SEC. 303. RENEWABLE FUEL STANDARD. 

10 Section 211(o)(2)(B) of the Clean Air Act (42 U.S.C. 

11 7545(o)(2)(B)) is amended— 

12 (1) by striking clause (i) and inserting the fol13 lowing: 

14 ‘‘(i) CALENDAR YEARS 2006 THROUGH

15 2025.—For the purpose of subparagraph 

16 (A), the applicable volume for any of cal17 endar years 2006 through 2025 shall be 

18 determined in accordance with the fol19 lowing table: 

Applicable volume of 

renewable fuel 

‘‘Calendar year: (in billions of gallons): 

2006 ......................................................................................... 4.0

2007 ......................................................................................... 4.7

2008 ......................................................................................... 5.5

2009 ......................................................................................... 6.2

2010 ......................................................................................... 6.9

2011 ......................................................................................... 7.5

2012 ......................................................................................... 7.6

2013 ......................................................................................... 9.2

2014 ......................................................................................... 11

2015 ......................................................................................... 12.7

2016 ......................................................................................... 14.4


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•S 2571 IS

Applicable volume of 

renewable fuel 

‘‘Calendar year: (in billions of gallons): 

2017 ......................................................................................... 16.2

2018 ......................................................................................... 17.9

2019 ......................................................................................... 19.6

2020 ......................................................................................... 21.4

2021 ......................................................................................... 23.1

2022 ......................................................................................... 24.8

2023 ......................................................................................... 26.5

2024 ......................................................................................... 28.3

2025 ......................................................................................... 30.’’ 

1 ; and 

2 (2) in clause (ii)— 

3 (A) in the clause heading, by striking 

4 ‘‘2013’’ and inserting ‘‘2026’’; 

5 (B) by striking ‘‘2013’’ and inserting 

6 ‘‘2026’’; and 

7 (C) by striking ‘‘2012’’ and inserting 

8 ‘‘2025’’. 

9 SEC. 304. MINIMUM QUANTITY OF RENEWABLE FUEL DE10 RIVED FROM CELLULOSIC BIOMASS. 

11 Section 211(o)(2)(B) of the Clean Air Act (42 U.S.C. 

12 7545(o)(2)(B)) is amended by striking clause (iii) and in13 serting the following: 

14 ‘‘(iii) MINIMUM QUANTITY DERIVED

15 FROM CELLULOSIC BIOMASS.— 

16 ‘‘(I) IN GENERAL.—The applica17 ble volume referred to in clauses (i) 

18 and (ii) shall contain a minimum of— 

19 ‘‘(aa) for calendar year 

20 2010, 100,000,000 gallons that 


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•S 2571 IS

1 are derived from cellulosic bio2 mass; 

3 ‘‘(bb) for calendar year 

4 2011, 150,000,000 gallons that 

5 are derived from cellulosic bio6 mass; 

7 ‘‘(cc) for calendar year 

8 2012, 200,000,000 gallons that 

9 are derived from cellulosic bio10 mass; and 

11 ‘‘(dd) for calendar year 

12 2013 and each calendar year 

13 thereafter, 250,000,000 gallons 

14 that are derived from cellulosic 

15 biomass. 

16 ‘‘(II) RATIO.—For calendar year 

17 2014 and each calendar year there18 after, the 2.5-to-1 ratio referred to in 

19 paragraph (4) shall not apply.’’. 

20 SEC. 305. MINIMUM QUANTITY OF RENEWABLE FUEL DE21 RIVED FROM SUGAR. 

22 Section 211(o)(2)(B) of the Clean Air Act (42 U.S.C. 

23 7545(o)(2)(B)) is amended by adding at the end the fol24 lowing: 


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•S 2571 IS

1 ‘‘(v) MINIMUM QUANTITY DERIVED

2 FROM SUGAR.— 

3 ‘‘(I) DEFINITION OF SUGAR.—In 

4 this clause: 

5 ‘‘(aa) IN GENERAL.—The 

6 term ‘sugar’ means sugarcane, 

7 sugar beets, or sugar components 

8 that are produced in the United 

9 States or imported subject to tar10 iff rate quota allocations. 

11 ‘‘(bb) EXCLUSIONS.—The 

12 term ‘sugar’ does not include do13 mestic or imported molasses, im14 ported thick beet juice, or other 

15 imported products not subject to 

16 tariff-rate quota allocations that 

17 are used as feedstock. 

18 ‘‘(II) MINIMUM NUMBER OF GAL19 LONS.—The applicable volume re20 ferred to in clauses (i) and (ii) shall 

21 contain a minimum of— 

22 ‘‘(aa) for calendar year 

23 2008, 100,000,000 gallons de24 rived from sugar; 


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1 ‘‘(bb) for calendar year 

2 2009, 108,000,000 gallons de3 rived from sugar; 

4 ‘‘(cc) for calendar year 

5 2010, 117,000,000 gallons de6 rived from sugar; 

7 ‘‘(dd) for calendar year 

8 2011, 126,000,000 gallons de9 rived from sugar; 

10 ‘‘(ee) for calendar year 

11 2012, 135,000,000 gallons de12 rived from sugar; 

13 ‘‘(ff) for calendar year 2013, 

14 144,000,000 gallons derived from 

15 sugar; 

16 ‘‘(gg) for calendar year 

17 2014, 153,000,000 gallons de18 rived from sugar; 

19 ‘‘(hh) for calendar year 

20 2015, 161,000,000 gallons de21 rived from sugar; 

22 ‘‘(ii) for calendar year 2016, 

23 170,000,000 gallons derived from 

24 sugar; 


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1 ‘‘(jj) for calendar year 2017, 

2 179,000,000 gallons derived from 

3 sugar; 

4 ‘‘(kk) for calendar year 

5 2018, 188,000,000 gallons de6 rived from sugar; 

7 ‘‘(ll) for calendar year 2019, 

8 197,000,000 gallons derived from 

9 sugar; 

10 ‘‘(mm) for calendar year 

11 2020, 206,000,000 gallons de12 rived from sugar; 

13 ‘‘(nn) for calendar year 

14 2021, 214,000,000 gallons de15 rived from sugar; 

16 ‘‘(oo) for calendar year 

17 2022, 223,000,000 gallons de18 rived from sugar; 

19 ‘‘(pp) for calendar year 

20 2023, 232,000,000 gallons de21 rived from sugar; 

22 ‘‘(qq) for calendar year 

23 2024, 241,000,000 gallons de24 rived from sugar; and 


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1 ‘‘(rr) for calendar year 2025 

2 and each calendar year there3 after, 250,000,000 gallons de4 rived from sugar.’’. 

5 SEC. 306. ETHANOL PROMOTION PROGRAM. 

6 Section 211(o) of the Clean Air Act (42 U.S.C. 

7 7545(o)) is amended by adding at the end the following: 

8 ‘‘(11) ETHANOL PROMOTION PROGRAM.— 

9 ‘‘(A) IN GENERAL.—The Secretary of Ag10 riculture shall carry out a program to support 

11 the development, commercialization, and pro12 duction of cellulosic ethanol and ethanol pro13 duced from sugar under this subsection. 

14 ‘‘(B) ADMINISTRATION.—The program— 

15 ‘‘(i) may include loan guarantees, 

16 loans, grants, and other forms of assist17 ance; and 

18 ‘‘(ii) shall be designed to ensure the 

19 production of ethanol in quantities suffi20 cient to meet the requirements of this sub21 section. 

22 ‘‘(C) PREVENTION OF SUGAR LOAN FOR23 FEITURES.— 

24 ‘‘(i) IN GENERAL.—The Secretary 

25 shall carry out the program under this 


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1 paragraph in a manner that is consistent 

2 with, and supports the continued no-cost 

3 implementation of, the sugar program es4 tablished under section 156 of the Federal 

5 Agriculture Improvement and Reform Act 

6 of 1996 (7 U.S.C. 7272) in accordance 

7 with section 902 of the Food Security Act 

8 of 1985 (Public Law 99–198; 7 U.S.C. 

9 1446g note). 

10 ‘‘(ii) ADMINISTRATION.—To carry out 

11 clause (i), in determining the overall allot12 ment quantity for any crop of domestic 

13 sugar, the Secretary shall— 

14 ‘‘(I) consider projected sugar 

15 used as sucrose ethanol feedstock as 

16 an addition to domestic food use; and 

17 ‘‘(II) count the sales of sugar to 

18 a sucrose ethanol producer against the 

19 annual marketing allocation of domes20 tic sugar processors. 

21 ‘‘(D) AUTHORIZATION OF APPROPRIA22 TIONS.—There are authorized to be appro23 priated such sums as are necessary to carry out 

24 this paragraph.’’. 


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1 SEC. 307. RENEWABLE FUEL PROGRAM FOR THE DIESEL 

2 MOTOR POOL. 

3 (a) IN GENERAL.—Section 211 of the Clean Air Act 

4 (42 U.S.C. 7545) is amended by inserting after subsection 

5 (o) the following: 

6 ‘‘(p) RENEWABLE FUEL PROGRAM FOR THE DIESEL

7 MOTOR POOL.— 

8 ‘‘(1) DEFINITION OF RENEWABLE FUEL.— 

9 ‘‘(A) IN GENERAL.—In this subsection, the 

10 term ‘renewable fuel’ has the meaning given the 

11 term in subsection (o)(1)(C). 

12 ‘‘(B) INCLUSIONS.—The term ‘renewable 

13 fuel’ includes a diesel fuel substitute produced 

14 from— 

15 ‘‘(i) animal fat; 

16 ‘‘(ii) vegetable oil; 

17 ‘‘(iii) recycled yellow grease; 

18 ‘‘(iv) thermal depolymerization; 

19 ‘‘(v) thermochemical conversion; 

20 ‘‘(vi) the coal-to-liquid process (includ21 ing the Fischer-Tropsch process); or 

22 ‘‘(vii) a diesel-ethanol blend. 

23 ‘‘(2) RENEWABLE FUEL PROGRAM.— 

24 ‘‘(A) REGULATIONS.— 

25 ‘‘(i) IN GENERAL.—Not later than 1 

26 year after the date of enactment of this 


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1 subsection, the Administrator shall promul2 gate regulations to ensure that diesel sold 

3 or introduced into commerce in the United 

4 States (except in noncontiguous States or 

5 territories), on an annual average basis, 

6 contains the applicable volume of renew7 able fuel determined in accordance with 

8 subparagraph (B). 

9 ‘‘(ii) PROVISIONS OF REGULATIONS.— 

10 Regardless of the date of promulgation, 

11 the regulations promulgated under clause 

12 (i)— 

13 ‘‘(I) shall contain compliance pro14 visions applicable to refineries, blend15 ers, distributors, and importers, as 

16 appropriate, to ensure that the re17 quirements of this paragraph are met; 

18 but 

19 ‘‘(II) shall not— 

20 ‘‘(aa) restrict geographic 

21 areas in which renewable fuel 

22 may be used; or 

23 ‘‘(bb) impose any per-gallon 

24 obligation for the use of renew25 able fuel. 


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1 ‘‘(iii) REQUIREMENT IN CASE OF

2 FAILURE TO PROMULGATE REGULA3 TIONS.—If the Administrator fails to pro4 mulgate regulations under clause (i), the 

5 percentage of renewable fuel in the diesel 

6 motor pool sold or dispensed to consumers 

7 in the United States, on a volume basis, 

8 shall be .006 percent for calendar year 

9 2008. 

10 ‘‘(B) APPLICABLE VOLUME.— 

11 ‘‘(i) CALENDAR YEARS 2008 THROUGH

12 2015.—For the purpose of subparagraph 

13 (A), the applicable volume for any of cal14 endar years 2008 through 2015 shall be 

15 determined in accordance with the fol16 lowing table: 

‘‘Applicable volume of renewable 

fuel in diesel motor pool 

(in millions of gallons): Calendar year: 

250 ........................................................................................... 2008

500 ........................................................................................... 2009

750 ........................................................................................... 2010

1,000 ........................................................................................ 2011

1,250 ........................................................................................ 2012

1,500 ........................................................................................ 2013

1,750 ........................................................................................ 2014

2,000 ........................................................................................ 2015. 

17 ‘‘(ii) CALENDAR YEAR 2016 AND

18 THEREAFTER.—The applicable volume for 

19 calendar year 2016 and each calendar year 

20 thereafter shall be determined by the AdVerDate Aug 31 2005 21:34 Apr 14, 2006 Jkt 049200 PO 00000 Frm 00054 Fmt 6652 Sfmt 6201 E:\BILLS\S2571.IS S2571

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1 ministrator, in coordination with the Sec2 retary of Agriculture and the Secretary of 

3 Energy, based on a review of the imple4 mentation of the program during calendar 

5 years 2008 through 2015, including a re6 view of— 

7 ‘‘(I) the impact of the use of re8 newable fuels on the environment, air 

9 quality, energy security, job creation, 

10 and rural economic development; and 

11 ‘‘(II) the expected annual rate of 

12 future production of renewable fuels 

13 to be used as a blend component or 

14 replacement to the diesel motor pool. 

15 ‘‘(iii) MINIMUM APPLICABLE VOL16 UME.—For the purpose of subparagraph 

17 (A), the applicable volume for calendar 

18 year 2016 and each calendar year there19 after shall be equal to the product obtained 

20 by multiplying— 

21 ‘‘(I) the number of gallons of die22 sel that the Administrator estimates 

23 will be sold or introduced into com24 merce during the calendar year; and 

25 ‘‘(II) the ratio that— 


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1 ‘‘(aa) 2,000,000,000 gallons 

2 of renewable fuel; bears to 

3 ‘‘(bb) the number of gallons 

4 of diesel sold or introduced into 

5 commerce during calendar year 

6 2015. 

7 ‘‘(3) APPLICABLE PERCENTAGES.— 

8 ‘‘(A) PROVISION OF ESTIMATE OF VOL9 UMES OF DIESEL SALES.—Not later than Octo10 ber 31 of each of calendar years 2007 through 

11 2015, the Administrator of the Energy Infor12 mation Administration shall provide to the Ad13 ministrator an estimate, with respect to the fol14 lowing calendar year, of the volumes of diesel 

15 projected to be sold or introduced into com16 merce in the United States. 

17 ‘‘(B) DETERMINATION OF APPLICABLE

18 PERCENTAGES.— 

19 ‘‘(i) IN GENERAL.—Not later than 

20 November 30 of each of calendar years 

21 2008 through 2015, based on the estimate 

22 provided under subparagraph (A), the Ad23 ministrator shall determine and publish in 

24 the Federal Register, with respect to the 

25 following calendar year, the renewable fuel 


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1 obligation that ensures that the require2 ments of paragraph (2) are met. 

3 ‘‘(ii) REQUIRED ELEMENTS.—The re4 newable fuel obligation determined for a 

5 calendar year under clause (i) shall— 

6 ‘‘(I) be applicable to refineries, 

7 blenders, and importers, as appro8 priate; 

9 ‘‘(II) be expressed in terms of a 

10 volume percentage of diesel sold or in11 troduced into commerce in the United 

12 States; and 

13 ‘‘(III) subject to subparagraph 

14 (C), consist of a single applicable per15 centage that applies to all categories 

16 of persons described in subclause (I). 

17 ‘‘(C) ADJUSTMENTS.—In determining the 

18 applicable percentage for a calendar year, the 

19 Administrator shall make adjustments to pre20 vent the imposition of redundant obligations on 

21 any person described in subparagraph 

22 (B)(ii)(I). 

23 ‘‘(4) CREDIT PROGRAM.— 

24 ‘‘(A) IN GENERAL.—The regulations pro25 mulgated pursuant to paragraph (2)(A) shall 


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1 provide for the generation of an appropriate 

2 amount of credits by any person that refines, 

3 blends, or imports diesel that contains a quan4 tity of renewable fuel that is greater than the 

5 quantity required under paragraph (2). 

6 ‘‘(B) USE OF CREDITS.—A person that 

7 generates a credit under subparagraph (A) may 

8 use the credit, or transfer all or a portion of the 

9 credit to another person, for the purpose of 

10 complying with regulations promulgated pursu11 ant to paragraph (2). 

12 ‘‘(C) DURATION OF CREDITS.—A credit 

13 generated under this paragraph shall be valid 

14 during the 1-year period beginning on the date 

15 on which the credit is generated. 

16 ‘‘(D) INABILITY TO GENERATE OR PUR17 CHASE SUFFICIENT CREDITS.—The regulations 

18 promulgated pursuant to paragraph (2)(A) 

19 shall include provisions allowing any person 

20 that is unable to generate or purchase sufficient 

21 credits under subparagraph (A) to meet the re22 quirements of paragraph (2) by carrying for23 ward a credit generated during a previous year 

24 on the condition that the person, during the calVerDate Aug 31 2005 21:34 Apr 14, 2006 Jkt 049200 PO 00000 Frm 00058 Fmt 6652 Sfmt 6201 E:\BILLS\S2571.IS S2571

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1 endar year following the year in which the re2 newable fuel deficit is created— 

3 ‘‘(i) achieves compliance with the re4 newable fuel requirement under paragraph 

5 (2); and 

6 ‘‘(ii) generates or purchases additional 

7 credits under subparagraph (A) to offset 

8 the deficit of the previous year. 

9 ‘‘(5) WAIVERS.— 

10 ‘‘(A) IN GENERAL.—The Administrator, in 

11 consultation with the Secretary of Agriculture 

12 and the Secretary of Energy, may waive the re13 quirements of paragraph (2) in whole or in part 

14 on receipt of a petition of 1 or more States by 

15 reducing the national quantity of renewable fuel 

16 for the diesel motor pool required under para17 graph (2) based on a determination by the Ad18 ministrator, after public notice and opportunity 

19 for comment, that— 

20 ‘‘(i) implementation of the require21 ment would severely harm the economy or 

22 environment of a State, a region, or the 

23 United States; or 

24 ‘‘(ii) there is an inadequate domestic 

25 supply of renewable fuel. 


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1 ‘‘(B) PETITIONS FOR WAIVERS.—Not later 

2 than 90 days after the date on which the Ad3 ministrator receives a petition under subpara4 graph (A), the Administrator, in consultation 

5 with the Secretary of Agriculture and the Sec6 retary of Energy, shall approve or disapprove 

7 the petition. 

8 ‘‘(C) TERMINATION OF WAIVERS.— 

9 ‘‘(i) IN GENERAL.—Except as pro10 vided in clause (ii), a waiver under sub11 paragraph (A) shall terminate on the date 

12 that is 1 year after the date on which the 

13 waiver is provided. 

14 ‘‘(ii) EXCEPTION.—The Adminis15 trator, in consultation with the Secretary 

16 of Agriculture and the Secretary of En17 ergy, may extend a waiver under subpara18 graph (A), as the Administrator deter19 mines to be appropriate.’’. 

20 (b) PENALTIES AND ENFORCEMENT.—Section 

21 211(d) of the Clean Air Act (42 U.S.C. 7545(d)) is 

22 amended— 

23 (1) in paragraph (1), by striking ‘‘or (o)’’ each 

24 place it appears and inserting ‘‘(o), or (p)’’; and 


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1 (2) in paragraph (2), by striking ‘‘and (o)’’ 

2 each place it appears and inserting ‘‘(o), and (p)’’. 

3 (c) TECHNICAL AMENDMENTS.—Section 211 of the 

4 Clean Air Act (42 U.S.C. 7545) is amended— 

5 (1) in subsection (c)(4)(C), by redesignating the 

6 second clause (v) as clause (vi); 

7 (2) in subsection (i)(4), by striking ‘‘section 

8 324’’ each place it appears and inserting ‘‘section 

9 325’’; 

10 (3) in subsection (k)(10), by indenting subpara11 graphs (E) and (F) appropriately; 

12 (4) in subsection (n), by striking ‘‘section 

13 219(2)’’ and inserting ‘‘section 216(2)’’; 

14 (5) by redesignating the second subsection (r) 

15 and subsection (s) as subsections (s) and (t), respec16 tively; and 

17 (6) in subsection (t)(1) (as redesignated by 

18 paragraph (5)), by striking ‘‘this subtitle’’ and in19 serting ‘‘this part’’. 

20 SEC. 308. EXTENSION AND MODIFICATION OF INCOME AND 

21 EXCISE TAX CREDITS FOR RENEWABLE 

22 FUELS. 

23 (a) INCOME TAX CREDITS.— 

24 (1) ALCOHOL USED AS FUEL.— 


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1 (A) IN GENERAL.—Paragraph (1) of sec2 tion 40(e) of the Internal Revenue Code of 

3 1986 is amended— 

4 (i) by striking ‘‘2010’’ in subpara5 graph (A) and inserting ‘‘2013’’, and 

6 (ii) by striking ‘‘2011’’ in subpara7 graph (B) and inserting ‘‘2014’’. 

8 (B) REDUCED CREDIT FOR ETHANOL

9 BLENDERS.—Subsection (h) of section 40 of 

10 such Code is amended— 

11 (i) by striking ‘‘2010’’ in paragraph 

12 (1) and inserting ‘‘2013’’, and 

13 (ii) by striking ‘‘2010’’ in the table in 

14 paragraph (2) and inserting ‘‘2013’’. 

15 (2) BIODIESEL AND RENEWABLE DIESEL USED

16 AS FUEL.—Subsection (g) of section 40A of the In17 ternal Revenue Code of 1986 is amended by striking 

18 ‘‘2008’’ and inserting ‘‘2013’’. 

19 (3) SMALL ETHANOL PRODUCER CREDIT EX20 PANDED FOR PRODUCERS OF SUCROSE AND CEL21 LULOSIC ETHANOL.— 

22 (A) IN GENERAL.—Subparagraph (C) of 

23 section 40(b)(4) of such Code (relating to small 

24 ethanol producer credit) is amended by insert25 ing ‘‘(30,000,000 gallons for any sucrose or celVerDate Aug 31 2005 21:34 Apr 14, 2006 Jkt 049200 PO 00000 Frm 00062 Fmt 6652 Sfmt 6201 E:\BILLS\S2571.IS S2571

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1 lulosic ethanol producer)’’ after ‘‘15,000,000 

2 gallons’’. 

3 (B) SUCROSE OR CELLULOSIC ETHANOL

4 PRODUCER.—Section 40(b)(4) of such Code is 

5 amended by adding at the end the following 

6 new subparagraph: 

7 ‘‘(E) SUCROSE OR CELLULOSIC ETHANOL

8 PRODUCER.— 

9 ‘‘(i) IN GENERAL.—For purposes of 

10 this paragraph, the term ‘sucrose or cel11 lulosic ethanol producer’ means a producer 

12 of ethanol using sucrose feedstock or cel13 lulosic feedstock. 

14 ‘‘(ii) SUCROSE FEEDSTOCK.—For pur15 poses of clause (i), the term ‘sucrose feed16 stock’ means any raw sugar, refined sugar, 

17 or sugar equivalents (including juice and 

18 extract). Such term does not include any 

19 molasses, beet thick juice, or other similar 

20 products as determined by the Secretary.’’. 

21 (C) CONFORMING AMENDMENTS.— 

22 (i) Section 40(g)(2) of such Code is 

23 amended by striking ‘‘15,000,000 gallon 

24 limitation’’ and inserting ‘‘15,000,000 and 

25 30,000,000 gallon limitations’’. 


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1 (ii) Section 40(g)(5)(B) of such Code 

2 is amended by striking ‘‘15,000,000 gal3 lons’’ and inserting ‘‘the gallon limitation 

4 under subsection (b)(4)(C)’’. 

5 (b) EXCISE TAX CREDITS.— 

6 (1) ALCOHOL FUEL MIXTURE CREDIT.—Para7 graph (5) of section 6426(b) of the Internal Revenue 

8 Code of 1986 is amended by striking ‘‘2010’’ and in9 serting ‘‘2013’’. 

10 (2) BIODIESEL MIXTURE CREDIT.—Paragraph 

11 (6) of section 6426(c) of the Internal Revenue Code 

12 of 1986 is amended by striking ‘‘2010’’ and insert13 ing ‘‘2013’’. 

14 (3) ALTERNATIVE FUEL CREDIT.—Paragraph 

15 (4) of section 6426(d) of the Internal Revenue Code 

16 of 1986 is amended by striking ‘‘2009’’ and insert17 ing ‘‘2013’’. 

18 (c) PAYMENTS FOR FUEL USED IN TRADE OR BUSI19 NESS.— 

20 (1) ALCOHOL FUEL MIXTURES.—Section 

21 6427(e)(5)(A) of the Internal Revenue Code of 1986 

22 is amended by striking ‘‘2010’’ and inserting 

23 ‘‘2013’’. 


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1 (2) BIODIESEL MIXTURES.—Section 

2 6427(e)(5)(B) of such Code is amended by striking 

3 ‘‘2008’’ and inserting ‘‘2013’’. 

4 (3) ALTERNATIVE FUEL AND ALTERNATIVE

5 FUEL MIXTURES.—Section 6427(e)(5)(C) of such 

6 Code is amended by striking ‘‘2009’’ and inserting 

7 ‘‘2013’’. 

8 (d) EFFECTIVE DATE.— 

9 (1) SUBSECTION (a).—The amendments made 

10 by subsection (a) shall apply to taxable years begin11 ning after the date of the enactment of this Act. 

12 (2) SUBSECTION (b).—The amendments made 

13 by subsection (b) shall apply to any sale, use, or re14 moval for any period after the date of enactment of 

15 this Act. 

16 (3) SUBSECTION (c).—The amendments made 

17 by subsection (c) shall apply to any sale or use for 

18 any period after the date of enactment of this Act. 

19 SEC. 309. DOMESTIC REFINERY DIVERSIFICATION. 

20 (a) PROGRAM.—The Secretary shall award grants for 

21 qualifying projects to support the commercial deployment 

22 of CTL refineries. 

23 (b) PROJECT CRITERIA.—A project shall be consid24 ered to be a qualifying project under this section if the 

25 Secretary determines that— 


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1 (1) the purpose of the project is the deployment 

2 of a CTL refinery in the United States; 

3 (2) the grant recipient is financially viable with4 out the receipt of additional Federal funding; 

5 (3) the project site has been identified; 

6 (4) a preliminary feasibility study has been 

7 completed; 

8 (5) a long-term source of coal has been identi9 fied and secured; and 

10 (6) the refinery will be designed to have— 

11 (A) a production capacity of at least 

12 12,000 barrels per day; and 

13 (B) carbon capture capability. 

14 (c) USE.—A grant under this section may be used 

15 to offset costs associated with the deployment of a CTL 

16 refinery in the United States, such as the costs of prelimi17 nary engineering and engineering design specifications. 

18 (d) MAXIMUM AMOUNT.—The amount of a grant 

19 made for a qualifying project under this section shall not 

20 exceed $50,000,000. 

21 (e) REPORT.—Not later than 1 year after the date 

22 of enactment of this Act, and annually thereafter until 

23 amounts made available to carry out this section are ex24 pended, the Secretary shall submit to Congress a report 

25 describing— 


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1 (1) the status of projects funded under this sec2 tion; and 

3 (2) the reasons for the denial of any grant for 

4 a project funded under this section. 

5 (f) AUTHORIZATION OF APPROPRIATIONS.—There is 

6 authorized to be appropriated to the Secretary to carry 

7 out this section $500,000,000, to remain available until 

8 expended. 

9 SEC. 310. TRANSITION TO A HYDROGEN-BASED ECONOMY. 

10 (a) IN GENERAL.—There are authorized to be appro11 priated to the Secretary the following amounts to carry 

12 out projects to promote the transition to a hydrogen-based 

13 economy: 

14 (1) For 4 demonstration projects under which 

15 hydrogen is produced from 3 or more feedstocks, 

16 $200,000,000 for each of fiscal years 2007 through 

17 2011, of which each demonstration project shall re18 ceive $50,000,000 for each fiscal year. 

19 (2) For hydrogen storage for on-road and off20 road applications— 

21 (A) $38,000,000 for fiscal year 2007; 

22 (B) $45,000,000 for fiscal year 2008; 

23 (C) $53,000,000 for fiscal year 2009; 

24 (D) $60,000,000 for fiscal year 2010; and 

25 (E) $70,000,000 for fiscal year 2010. 


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1 (3) For technologies for the production and pu2 rification of hydrogen with pressures of 10,000 

3 pounds per square inch or more— 

4 (A) $40,000,000 for fiscal year 2007; 

5 (B) $48,000,000 for fiscal year 2008; 

6 (C) $56,000,000 for fiscal year 2009; and 

7 (D) $62,000,000 for fiscal year 2010. 

8 (4) For the incorporation of carbon sequestra9 tion strategies into hydrogen production technologies 

10 for carbon sequestered from plants used to produce 

11 hydrogen, using as a model the program established 

12 under section 963 of the Energy Policy Act of 2005 

13 (42 U.S.C. 16293)— 

14 (A) $50,000,000 for fiscal year 2007; 

15 (B) $75,000,000 for fiscal year 2008; 

16 (C) $100,000,000 for fiscal year 2009; and 

17 (D) $110,000,000 for fiscal year 2010. 

18 (5) For development of a national hydrogen in19 frastructure plan, such sums as are necessary. 

20 (6) For the National Center for Hydrogen 

21 Technology designated by the Department of En22 ergy— 

23 (A) $3,500,000 for fiscal year 2007; 

24 (B) $4,000,000 for fiscal year 2008; 

25 (C) $4,500,000 for fiscal year 2009; and 


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1 (D) $5,000,000 for fiscal year 2010. 

2 (7) For regional centers for hydrogen tech3 nology designated by the Department of Energy, 

4 $17,000,000 for fiscal year 2007. 

5 (8) For the Controlled Hydrogen Fleet and In6 frastructure Demonstration Validation Program of 

7 the Department of Energy— 

8 (A) for the controlled hydrogen fleet— 

9 (i) $30,000,000 for fiscal year 2007; 

10 (ii) $35,000,000 for fiscal year 2008; 

11 (iii) $41,000,000 for fiscal year 2009; 

12 and 

13 (iv) $47,000,000 for fiscal year 2010; 

14 and 

15 (B) for infrastructure demonstration vali16 dation— 

17 (i) $18,000,000 for fiscal year 2007; 

18 (ii) $22,000,000 for fiscal year 2008; 

19 (iii) $26,000,000 for fiscal year 2009; 

20 and 

21 (iv) $30,000,000 for fiscal year 2010. 

22 (9) For the hydrogen automotive technologies 

23 programs of the Department of Defense— 

24 (A) $25,000,000 for fiscal year 2007; 

25 (B) $30,000,000 for fiscal year 2008; 


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1 (C) $35,000,000 for fiscal year 2009; and 

2 (D) $40,000,000 for fiscal year 2010. 

3 (b) FEDERAL AND STATE PROCUREMENT OF FUEL

4 CELL VEHICLES AND HYDROGEN ENERGY SYSTEMS.— 

5 Section 782(e) of the Energy Policy Act of 2005 (42 

6 U.S.C. 16122(e)) is amended by striking paragraphs (2) 

7 and (3) and inserting the following: 

8 ‘‘(2) $35,000,000 for fiscal year 2009; 

9 ‘‘(3) $80,000,000 for fiscal year 2010; and’’. 

10 (c) FEDERAL PROCUREMENT OF STATIONARY, PORT11 ABLE, AND MICRO FUEL CELLS.—Section 783(d) of the 

12 Energy Policy Act of 2005 (42 U.S.C. 16123(d)) is 

13 amended by striking paragraphs (2) through (5) and in14 serting the following: 

15 ‘‘(2) $75,000,000 for fiscal year 2007; 

16 ‘‘(3) $100,000,000 for fiscal year 2008; 

17 ‘‘(4) $125,000,000 for fiscal year 2009; 

18 ‘‘(5) $150,000,000 for fiscal year 2010; and’’. 

19 (d) HYDROGEN PROGRAMS.—Section 805 of the En20 ergy Policy Act of 2005 (42 U.S.C. 16154) is amended— 

21 (1) in subsection (h), by striking paragraphs 

22 (3) through (5) and inserting the following: 

23 ‘‘(3) $232,000,000 for fiscal year 2008; 

24 ‘‘(4) $252,500,000 for fiscal year 2009; 


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1 ‘‘(5) $283,000,000 for fiscal year 2010; and’’; 

2 and 

3 (2) in subsection (i), by striking paragraphs (2) 

4 through (5) and inserting the following: 

5 ‘‘(2) $180,000,000 for fiscal year 2007; 

6 ‘‘(3) $200,000,000 for fiscal year 2008; 

7 ‘‘(4) $220,000,000 for fiscal year 2009; 

8 ‘‘(5) $240,000,000 for fiscal year 2010; and’’. 

9 SEC. 311. MODIFICATION AND EXTENSION OF ALTER10 NATIVE VEHICLE REFUELING PROPERTY 

11 CREDIT. 

12 (a) INCREASE IN CREDIT AMOUNT.—Subsection (a) 

13 of section 30C of the Internal Revenue Code of 1986 is 

14 amended by striking ‘‘30 percent’’ and inserting ‘‘50 per15 cent’’. 

16 (b) CREDIT ALLOWABLE AGAINST ALTERNATIVE

17 MINIMUM TAX.—Paragraph (2) of section 30C of the In18 ternal Revenue Code of 1986 is amended to read as fol19 lows: 

20 ‘‘(2) PERSONAL CREDIT.—The credit allowed 

21 under subsection (a) (after the application of para22 graph (1)) for any taxable year shall not exceed the 

23 excess (if any) of— 


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1 ‘‘(A) the sum of the regular tax for the 

2 taxable year plus the tax imposed by section 55, 

3 over 

4 ‘‘(B) the sum of the credits allowable 

5 under subpart A and sections 27, 30, and 

6 30B.’’. 

7 (c) EXTENSION OF CREDIT.—Paragraph (2) of sec8 tion 30C(g) of the Internal Revenue Code of 1986 is 

9 amended by striking ‘‘December 31, 2009’’ and inserting 

10 ‘‘December 31, 2013’’. 

11 (d) EFFECTIVE DATE.—The amendments made by 

12 this section shall apply to taxable years beginning after 

13 December 31, 2005. 

14 SEC. 312. USE OF NATIVE GRASSES ON CONSERVATION RE15 SERVE LAND FOR BIOMASS HARVESTING. 

16 (a) PURPOSE.—The purpose of this section is to clar17 ify that an owner or operator of a farm or ranch that has 

18 entered into a conservation reserve contract may harvest 

19 perennial, permanent cover crops on land that is subject 

20 to the contract for the production of cellulosic ethanol, 

21 biogas, biobased hydrogen, other biobased liquid fuels, or 

22 other biobased products. 

23 (b) USE OF NATIVE GRASSES.—Section 

24 1232(a)(7)(A) of the Food Security Act of 1985 (16 

25 U.S.C. 3832(a)(7)(A)) is amended— 


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1 (1) in clause (ii), by striking ‘‘and’’ after the 

2 semicolon at the end; and 

3 (2) by adding at the end the following: 

4 ‘‘(iv) shall permit the use of native 

5 grasses to produce cellulosic ethanol, 

6 biogas, biobased hydrogen, other biobased 

7 liquid fuel, or other biobased products (col8 lectively referred to in this clause as 

9 ‘biobased products’), except that— 

10 ‘‘(I) native grasses may not be 

11 used to produce biobased products on 

12 land that is enrolled in the conserva13 tion reserve if the land is devoted to 

14 shallow water for wildlife, wildlife 

15 habitat, diversion or erosion preven16 tion, wetland restoration, rare or de17 clining habitat, or upland bird habitat 

18 buffers; 

19 ‘‘(II) native grasses may be used 

20 to produce biobased products under 

21 this subparagraph only during the pe22 riod beginning September 31, and 

23 ending May 1, of each year; and 

24 ‘‘(III) not more than 50 percent 

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1 servation reserve may be used to 

2 produce biobased products each year; 

3 and’’. 

4 SEC. 313. USE OF CAFE ́ PENALTIES TO BUILD ALTERNATIVE 

5 FUELING INFRASTRUCTURE. 

6 Section 32912 of title 49, United States Code, is 

7 amended by adding at the end the following 

8 ‘‘(e) ALTERNATIVE FUELING INFRASTRUCTURE

9 TRUST FUND.— 

10 ‘‘(1) ESTABLISHMENT.—There is established in 

11 the Treasury of the United States a trust fund, to 

12 be known as the Alternative Fueling Infrastructure 

13 Trust Fund, consisting of— 

14 ‘‘(A) such amounts as are deposited into 

15 the Trust Fund under paragraph (2); and 

16 ‘‘(B) any interest earned on investment of 

17 amounts in the Trust Fund. 

18 ‘‘(2) DEPOSITS.—The Secretary of Transpor19 tation shall remit to the Treasury 90 percent of the 

20 amounts collected in civil penalties each year under 

21 this section for deposit to the Trust Fund. 

22 ‘‘(3) INVESTMENT OF AMOUNTS.— 

23 ‘‘(A) IN GENERAL.—The Secretary of the 

24 Treasury shall invest such portion of the Trust 

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1 retary of the Treasury, required to meet cur2 rent withdrawals. 

3 ‘‘(B) INTEREST-BEARING OBLIGATIONS.— 

4 Investments may be made only in interest-bear5 ing obligations of the United States. 

6 ‘‘(C) ACQUISITION OF OBLIGATIONS.—For 

7 the purpose of investments under subparagraph 

8 (A), obligations may be acquired— 

9 ‘‘(i) on original issue at the issue 

10 price; or 

11 ‘‘(ii) by purchase of outstanding obli12 gations at the market price. 

13 ‘‘(D) SALE OF OBLIGATIONS.—Any obliga14 tion acquired by the Trust Fund may be sold 

15 by the Secretary of the Treasury at the market 

16 price. 

17 ‘‘(E) CREDITS TO TRUST FUND.—The in18 terest on, and the proceeds from the sale or re19 demption of, any obligations held in the Trust 

20 Fund shall be credited to and form a part of 

21 the Trust Fund. 

22 ‘‘(4) TRANSFERS OF AMOUNTS.— 

23 ‘‘(A) IN GENERAL.—The amounts required 

24 to be transferred to the Trust Fund under this 

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1 terly from the general fund of the Treasury to 

2 the Trust Fund on the basis of estimates made 

3 by the Secretary of the Treasury. 

4 ‘‘(B) ADJUSTMENTS.—Proper adjustment 

5 shall be made in amounts subsequently trans6 ferred to the extent prior estimates were in ex7 cess of or less than the amounts required to be 

8 transferred. 

9 ‘‘(5) EXPENDITURES FROM THE FUND.— 

10 ‘‘(A) IN GENERAL.—The Secretary of En11 ergy shall obligate such sums as are available in 

12 the Trust Fund to establish a grant program to 

13 increase the number of locations at which con14 sumers may purchase alternative fuels. 

15 ‘‘(B) AMOUNT AND PERSONS ELIGIBLE.— 

16 The Secretary of Energy may award grants 

17 under this paragraph in an amount not to ex18 ceed $150,000 to persons who have expertise 

19 in— 

20 ‘‘(i) operating a fueling station; or 

21 ‘‘(ii) administering grants for the pur22 pose of establishing an alternative fueling 

23 infrastructure. 

24 ‘‘(C) OTHER CONSIDERATIONS.— 


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1 ‘‘(i) NUMBER OF VEHICLES TO BE

2 SERVED.—In awarding grants under this 

3 paragraph, the Secretary shall consider the 

4 number of vehicles in service capable of 

5 using a specific type of alternative fuel. 

6 ‘‘(ii) MATCHING FUNDS.—A recipient 

7 of a grant under this paragraph shall pro8 vide a non-Federal match of not less than 

9 $1 for every $3 of grant funds received 

10 under this paragraph. 

11 ‘‘(iii) SELECTION OF LOCATIONS.— 

12 Each grant recipient shall select the loca13 tion for each alternative fuel station to be 

14 constructed with grant funds received 

15 under this paragraph on a formal, open, 

16 and competitive basis. 

17 ‘‘(D) USE OF FUNDS.—Grants received 

18 under this paragraph may be used to— 

19 ‘‘(i) construct new facilities to dis20 pense alternative fuels; 

21 ‘‘(ii) purchase equipment to upgrade, 

22 expand, or otherwise improve existing al23 ternative fuel facilities; or 


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1 ‘‘(iii) purchase equipment or pay for 

2 specific turnkey fueling services by alter3 native fuel providers. 

4 ‘‘(E) REQUIREMENT FOR FACILITIES.— 

5 Facilities constructed or upgraded with a grant 

6 awarded under this paragraph shall— 

7 ‘‘(i) provide alternative fuel to the 

8 public for a period of not less than 4 years 

9 from the date on which the facility opens; 

10 ‘‘(ii) establish a marketing plan to ad11 vance the sale and use of alternative fuels; 

12 ‘‘(iii) prominently display the price of 

13 the alternative fuel being provided on the 

14 station marquee and in the station; 

15 ‘‘(iv) provide point of sale materials 

16 on alternative fuel; 

17 ‘‘(v) clearly label the dispenser with 

18 consistent materials; 

19 ‘‘(vi) price the alternative fuel at a 

20 margin that is not greater than that which 

21 is received for unleaded gasoline; and 

22 ‘‘(vii) support and use all available tax 

23 incentives to reduce the cost of the alter24 native fuel to the lowest possible retail 

25 price. 


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1 ‘‘(F) NOTIFICATION OF OPENING OF FA2 CILITY.—Not later than the date on which an 

3 alternative fuel station described in this para4 graph begins to offer alternative fuel to the 

5 public, the person that received the grant to 

6 construct or upgrade the station shall notify the 

7 Secretary of Energy of such opening. The Sec8 retary of Energy shall add each new alternative 

9 fuel station to the alternative fuel station loca10 tor on the Department of Energy Website when 

11 the Secretary receives notification under this 

12 subparagraph. 

13 ‘‘(G) REPORT.—Not later than 6 months 

14 after the receipt of a grant award under this 

15 paragraph, and every 6 months thereafter, each 

16 person receiving a grant under this subsection 

17 shall submit a report to the Secretary of En18 ergy that describes— 

19 ‘‘(i) the status of each alternative fuel 

20 station constructed with grant funds re21 ceived under this paragraph; 

22 ‘‘(ii) the amount of alternative fuel 

23 dispensed at each station during the pre24 ceding 6-month period; and 


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1 ‘‘(iii) the average price per gallon of 

2 the alternative fuel sold at each station 

3 during the preceding 6-month period.’’. 

4 TITLE IV—DOMESTIC PRODUC5 TION OF OIL AND NATURAL 

6 GAS 

7 SEC. 401. MODIFICATIONS TO ENHANCED OIL RECOVERY 

8 CREDIT. 

9 (a) ENHANCED CREDIT FOR CARBON DIOXIDE IN10 JECTIONS.—Section 43 of the Internal Revenue Code of 

11 1986 is amended by adding at the end the following new 

12 subsection: 

13 ‘‘(f) ENHANCED CREDIT FOR PROJECTS USING

14 QUALIFIED CARBON DIOXIDE.— 

15 ‘‘(1) IN GENERAL.—In the case of any qualified 

16 enhanced oil recovery project described in paragraph 

17 (2), subsection (a) shall be applied by substituting 

18 ‘20 percent’ for ‘15 percent’. 

19 ‘‘(2) SPECIFIED QUALIFIED ENHANCED OIL RE20 COVERY PROJECT.— 

21 ‘‘(A) IN GENERAL.—A qualified enhanced 

22 oil recovery project is described in this para23 graph if— 


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1 ‘‘(i) the project begins or is substan2 tially expanded after December 31, 2006, 

3 and 

4 ‘‘(ii) the project uses qualified carbon 

5 dioxide in an oil recovery method which in6 volves flooding or injection. 

7 ‘‘(B) QUALIFIED CARBON DIOXIDE.—For 

8 purposes of this subsection, the term ‘qualified 

9 carbon dioxide’ means carbon dioxide that is— 

10 ‘‘(i) from an industrial source, or 

11 ‘‘(ii) separated from natural gas and 

12 natural gas liquids at a natural gas proc13 essing plant. 

14 ‘‘(3) TERMINATION.—This subsection shall not 

15 apply to costs paid or incurred for any qualified en16 hanced oil recovery project after December 31, 

17 2010.’’. 

18 (b) EFFECTIVE DATE.—The amendments made by 

19 this section shall apply to costs paid or incurred in taxable 

20 years ending after December 31, 2006. 

21 SEC. 402. OFFSHORE OIL AND GAS LEASING IN 181 AREA OF 

22 GULF OF MEXICO. 

23 (a) DEFINITION OF SECRETARY.—In this section, the 

24 term ‘‘Secretary’’ means the Secretary of the Interior, act25 ing through the Minerals Management Service. 


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1 (b) LEASE SALE.—Except as otherwise provided in 

2 this section, the Secretary shall offer the 181 Area for oil 

3 and gas leasing pursuant to the Outer Continental Shelf 

4 Lands Act (43 U.S.C. 1331 et seq.) as soon as practicable, 

5 but not later than 1 year, after the date of enactment of 

6 this Act. 

7 (c) EXCLUDED AREAS.—In carrying out subsection 

8 (b), the Secretary shall not offer for oil and gas leasing— 

9 (1) any area east of the Military Mission Line, 

10 unless the Secretary of Defense agrees in writing be11 fore the area is offered for lease that the area can 

12 be developed in a manner that will not interfere with 

13 military activities; or 

14 (2) any area that is within 100 miles of the 

15 coastline of the State of Florida. 

16 (d) LEASING PROGRAM.—The 181 Area shall be of17 fered for lease under this section notwithstanding the 

18 omission of the 181 Area from any outer Continental Shelf 

19 leasing program under section 18 of the Outer Continental 

20 Shelf Lands Act (43 U.S.C. 1344). 

21 TITLE V—ELECTRICITY AND 

22 RENEWABLES 

23 SEC. 501. DOE NATIONAL AND NORTH AMERICAN ELEC24 TRICITY GRID STUDIES. 

25 (a) FINDINGS.—Congress finds that— 


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1 (1) the interstate transmission system of North 

2 America cannot reliably handle the existing and ex3 pected dramatic increase in future electric trans4 actions; 

5 (2) significant new transmission capacity is ur6 gently needed to maintain reliability and meet the 

7 needs of a growing demand for electricity; 

8 (3) transmission shortages and constraints are 

9 contributing to wholesale and retail electric market 

10 failures that are harming electric consumers in, and 

11 the economy of, the United States; 

12 (4) existing transmission capacity limits the de13 velopment of renewable and other energy sources by 

14 constraining delivery of those resources into the na15 tional power market; 

16 (5) excessive congestion unnecessarily raises 

17 costs for all consumers; and 

18 (6) an adequate transmission system is critical 

19 to national security. 

20 (b) STUDIES.— 

21 (1) IN GENERAL.—Not later than 1 year after 

22 the date of enactment of this Act, the Secretary, in 

23 consultation with the Rural Utilities Service, the 

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1 eral Energy Regulatory Commission, and other ap2 propriate regional entities, shall carry out— 

3 (A) a study, to be known as the ‘‘National 

4 Transmission Grid Study’’, to determine the 

5 feasibility of constructing a national trans6 mission grid with nationwide functionality and 

7 benefits similar to those provided by construc8 tion of the Interstate Highway System; and 

9 (B) a study, to be known as the ‘‘North 

10 American Transmission Grid Study’’, to deter11 mine the feasibility of constructing an inte12 grated North American transmission grid with 

13 international functionality and benefits similar 

14 to those provided by construction of the Inter15 state Highway System. 

16 (2) STUDY.—In carrying out the studies, the 

17 Secretary shall take into consideration— 

18 (A) economic viability, including the cost19 effectiveness of developing a national trans20 mission grid or North American transmission 

21 grid, as appropriate; 

22 (B) economic growth in the United States, 

23 including the extent to which that economic 

24 growth is constrained by the lack of adequate 

25 or reasonably-priced electricity; 


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1 (C) limited transmission infrastructure, re2 sulting in the inability or limited ability to 

3 transmit available power supply resources; 

4 (D) diversification of power supply; 

5 (E) requirements and needs relating to the 

6 national defense and homeland security of the 

7 United States; 

8 (F) promotion of national energy security; 

9 (G) transmission losses; and 

10 (H) reliability. 

11 (c) REPORT TO CONGRESS.—Not later than 90 days 

12 after the date of completion of the studies required by sub13 section (c)(1), the Secretary shall submit to Congress a 

14 report describing the viability of constructing— 

15 (1) a national transmission grid in accordance 

16 with nationwide functionality and benefits similar to 

17 those provided by construction of the Interstate Sys18 tem; and 

19 (2) an integrated North American transmission 

20 grid with international functionality and benefits 

21 similar to those provided by construction of the 

22 Interstate System. 

23 (d) AUTHORIZATION OF APPROPRIATIONS.—There 

24 are authorized to be appropriated such sums as are nec25 essary to carry out this section. 


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1 SEC. 502. TAX-EXEMPT FINANCING OF ELECTRIC TRANS2 MISSION FACILITIES NOT SUBJECT TO PRI3 VATE BUSINESS USE TEST. 

4 (a) IN GENERAL.—Section 141(b)(6) of the Internal 

5 Revenue Code of 1986 (defining private business use) is 

6 amended by adding at the end the following new subpara7 graph: 

8 ‘‘(C) EXCEPTION FOR ELECTRIC TRANS9 MISSION FACILITIES.—For purposes of the 1st 

10 sentence of subparagraph (A), the operation or 

11 use of an electric transmission facility by any 

12 person which is not a governmental unit shall 

13 not be considered a private business use.’’. 

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

15 this section shall apply to bonds issued after the date of 

16 the enactment of this Act. 

17 SEC. 503. EXTENSION OF CREDIT FOR PRODUCING ELEC18 TRICITY FROM CERTAIN RENEWABLE RE19 SOURCES. 

20 (a) IN GENERAL.—Paragraphs (1) through (7) of 

21 section 45(d) of the Internal Revenue Code of 1986 are 

22 each amended by striking ‘‘January 1, 2008’’ each place 

23 it appears and inserting ‘‘January 1, 2013’’. 

24 (b) EFFECTIVE DATE.—The amendments made by 

25 this section shall take effect on the date of the enactment 

26 of this Act. 


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1 SEC. 504. FEDERAL RENEWABLE PORTFOLIO STANDARD. 

2 The Public Utility Regulatory Policies Act of 1978 

3 (16 U.S.C. 2601 et seq.) is amended by adding at the end 

4 of title VI the following: 

5 ‘‘SEC. 610. FEDERAL RENEWABLE PORTFOLIO STANDARD. 

6 ‘‘(a) DEFINITIONS.—In this section: 

7 ‘‘(1) BASE AMOUNT OF ELECTRICITY.—The 

8 term ‘base amount of electricity’ means the total 

9 amount of electricity sold by an electric utility to 

10 electric consumers in a calendar year, excluding— 

11 ‘‘(A) electricity generated by a hydro12 electric facility (including a pumped storage fa13 cility but excluding incremental hydropower); 

14 and 

15 ‘‘(B) electricity generated through the in16 cineration of municipal solid waste. 

17 ‘‘(2) DISTRIBUTED GENERATION FACILITY.— 

18 The term ‘distributed generation facility’ means a 

19 facility at a customer site. 

20 ‘‘(3) EXISTING RENEWABLE ENERGY.—The 

21 term ‘existing renewable energy’ means, except as 

22 provided in paragraph (7)(B), electric energy gen23 erated at a facility (including a distributed genera24 tion facility) placed in service prior to the date of 

25 enactment of this section from— 

26 ‘‘(A) solar, wind, or geothermal energy; 


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1 ‘‘(B) ocean energy; 

2 ‘‘(C) biomass (as defined in section 203(b) 

3 of the Energy Policy Act of 2005 (42 U.S.C. 

4 15852(b))); or 

5 ‘‘(D) landfill gas. 

6 ‘‘(4) GEOTHERMAL ENERGY.—The term ‘geo7 thermal energy’ means energy derived from a geo8 thermal deposit (within the meaning of section 

9 613(e)(2) of the Internal Revenue Code of 1986). 

10 ‘‘(5) INCREMENTAL GEOTHERMAL PRODUC11 TION.— 

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

13 geothermal production’ means, for any year, the 

14 difference between— 

15 ‘‘(i) the total kilowatt hours of elec16 tricity produced from a facility (including a 

17 distributed generation facility) using geo18 thermal energy, and 

19 ‘‘(ii) the average annual kilowatt 

20 hours produced at the facility for 5 of the 

21 7 calendar years preceding the date of en22 actment of this section after eliminating 

23 the highest and the lowest kilowatt hour 

24 production years in that 7-year period. 


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1 ‘‘(B) SPECIAL RULE.—A facility described 

2 in subparagraph (A) that was placed in service 

3 at least 7 years before the date of enactment of 

4 this section shall, beginning with the year in 

5 which that date of enactment occurs, reduce the 

6 amount calculated under subparagraph (A)(ii) 

7 each year, on a cumulative basis, by the average 

8 percentage decrease in the annual kilowatt hour 

9 production for the 7-year period described in 

10 subparagraph (A)(ii), the cumulative sum of 

11 which shall not exceed 30 percent. 

12 ‘‘(6) INCREMENTAL HYDROPOWER.— 

13 ‘‘(A) IN GENERAL.—The term ‘incremental 

14 hydropower’ means additional energy generated 

15 as a result of efficiency improvements or capac16 ity additions made on or after the date of en17 actment of this section or the effective date of 

18 an existing applicable State renewable portfolio 

19 standard program at a hydroelectric facility 

20 that was placed in service before that date. 

21 ‘‘(B) EXCLUSIONS.—The term ‘incre22 mental hydropower’ does not include additional 

23 energy generated as a result of operational 

24 changes not directly associated with efficiency 

25 improvements or capacity additions. 


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1 ‘‘(C) MEASUREMENT OF IMPROVEMENTS

2 AND ADDITIONS.—Efficiency improvements and 

3 capacity additions referred to in subparagraph 

4 (A) shall be measured on the basis of the same 

5 water flow information used to determine a his6 toric average annual generation baseline for the 

7 hydroelectric facility and certified by the Sec8 retary or the Federal Energy Regulatory Com9 mission. 

10 ‘‘(7) NEW RENEWABLE ENERGY.—The term 

11 ‘new renewable energy’ means— 

12 ‘‘(A) electric energy generated at a facility 

13 (including a distributed generation facility) 

14 placed in service on or after January 1, 2003, 

15 from— 

16 ‘‘(i) solar, wind, or geothermal energy 

17 or ocean energy; 

18 ‘‘(ii) biomass (as defined in section 

19 203(b) of the Energy Policy Act of 2005 

20 (42 U.S.C. 15852(b))); 

21 ‘‘(iii) landfill gas; or 

22 ‘‘(iv) incremental hydropower; and 

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1 ity) placed in service before the date of enact2 ment of this section— 

3 ‘‘(i) the additional energy above the 

4 average generation in the 3 years pre5 ceding the date of enactment of this sec6 tion at the facility from— 

7 ‘‘(I) solar or wind energy or 

8 ocean energy; 

9 ‘‘(II) biomass (as defined in sec10 tion 203(b) of the Energy Policy Act 

11 of 2005 (42 U.S.C. 15852(b))); 

12 ‘‘(III) landfill gas; or 

13 ‘‘(IV) incremental hydropower; 

14 and 

15 ‘‘(ii) the incremental geothermal pro16 duction. 

17 ‘‘(8) OCEAN ENERGY.—The term ‘ocean energy’ 

18 includes current, wave, tidal, and thermal energy. 

19 ‘‘(b) RENEWABLE ENERGY REQUIREMENT.— 

20 ‘‘(1) REQUIREMENT.— 

21 ‘‘(A) IN GENERAL.—Each electric utility 

22 that sells electricity to electric consumers shall 

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1 sumers in any calendar year from new renew2 able energy or existing renewable energy. 

3 ‘‘(B) PERCENTAGES.—The percentage ob4 tained in a calendar year shall not be less than 

5 the amount specified in the following table: 

Minimum annual 

‘‘Calendar year: percentage: 

2008 through 2011 .................................................................. 2.5

2012 through 2015 .................................................................. 5.0

2016 through 2019 .................................................................. 7.5

2020 through 2030 .................................................................. 10.0.

6 ‘‘(2) MEANS OF COMPLIANCE.—An electric util7 ity shall meet the requirements of paragraph (1) 

8 by— 

9 ‘‘(A) generating electric energy using new 

10 renewable energy or existing renewable energy; 

11 ‘‘(B) purchasing electric energy generated 

12 by new renewable energy or existing renewable 

13 energy; 

14 ‘‘(C) purchasing renewable energy credits 

15 issued under subsection (c); or 

16 ‘‘(D) a combination of the foregoing. 

17 ‘‘(c) RENEWABLE ENERGY CREDIT TRADING PRO18 GRAM.— 

19 ‘‘(1) IN GENERAL.—Not later than January 1, 

20 2007, the Secretary shall establish a renewable en21 ergy credit trading program to permit an electric 

22 utility that does not generate or purchase enough 


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1 electric energy from renewable energy to meet its ob2 ligations under subsection (b)(1) to satisfy the re3 quirements by purchasing sufficient renewable en4 ergy credits. 

5 ‘‘(2) RESPONSIBILITIES OF SECRETARY.—As 

6 part of the program, the Secretary shall— 

7 ‘‘(A) issue renewable energy credits to gen8 erators of electric energy from new renewable 

9 energy; 

10 ‘‘(B) sell renewable energy credits to elec11 tric utilities at the rate of 1.5 cents per kilo12 watt-hour (as adjusted for inflation under sub13 section (h)); 

14 ‘‘(C) ensure that a kilowatt hour, including 

15 the associated renewable energy credit, shall be 

16 used only once for purposes of compliance with 

17 this section; and 

18 ‘‘(D) allow double credits for generation 

19 from facilities on Indian land, and triple credits 

20 for generation from small renewable distributed 

21 generators (meaning those no larger than 1 

22 megawatt). 

23 ‘‘(3) USE OF CREDITS.—A credit under para24 graph (2)(A) may only be used for compliance with 


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1 this section for the 3-year period beginning on the 

2 date of issuance of the credit. 

3 ‘‘(d) ENFORCEMENT.— 

4 ‘‘(1) CIVIL PENALTIES.—Any electric utility 

5 that fails to meet the renewable energy requirements 

6 of subsection (b) shall be subject to a civil penalty. 

7 ‘‘(2) AMOUNT OF PENALTY.—The amount of 

8 the civil penalty shall be determined by multiplying 

9 the number of kilowatt-hours of electric energy sold 

10 to electric consumers in violation of subsection (b) 

11 by the greater of 1.5 cents (adjusted for inflation 

12 under subsection (h)) or 200 percent of the average 

13 market value of renewable energy credits during the 

14 year in which the violation occurred. 

15 ‘‘(3) MITIGATION OR WAIVER.— 

16 ‘‘(A) IN GENERAL.—The Secretary may 

17 mitigate or waive a civil penalty under this sub18 section if the electric utility was unable to com19 ply with subsection (b) for reasons outside of 

20 the reasonable control of the utility. 

21 ‘‘(B) REDUCTION OF AMOUNT.—The Sec22 retary shall reduce the amount of any penalty 

23 determined under paragraph (2) by an amount 

24 paid by the electric utility to a State for failure 

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1 newable energy program if the State require2 ment is greater than the applicable requirement 

3 of subsection (b). 

4 ‘‘(4) PROCEDURE FOR ASSESSING PENALTY.— 

5 The Secretary shall assess a civil penalty under this 

6 subsection in accordance with the procedures pre7 scribed by section 333(d) of the Energy Policy and 

8 Conservation Act of 1954 (42 U.S.C. 6303). 

9 ‘‘(e) STATE RENEWABLE ENERGY ACCOUNT PRO10 GRAM.— 

11 ‘‘(1) IN GENERAL.—Not later than December 

12 31, 2008, the Secretary shall establish a State re13 newable energy account program. 

14 ‘‘(2) DEPOSIT OF AMOUNTS.—All funds col15 lected by the Secretary from the sale of renewable 

16 energy credits and the assessment of civil penalties 

17 under this section shall be deposited into the renew18 able energy account established pursuant to this 

19 subsection. 

20 ‘‘(3) MAINTENANCE OF ACCOUNT.—The State 

21 renewable energy account shall be held by the Sec22 retary and shall not be transferred to the Treasury 

23 Department. 

24 ‘‘(4) USE OF AMOUNTS.—Proceeds deposited in 

25 the State renewable energy account shall be used by 


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1 the Secretary, subject to appropriations, for a pro2 gram to provide grants to the State agency respon3 sible for developing State energy conservation plans 

4 under section 362 of the Energy Policy and Con5 servation Act (42 U.S.C. 6322) for the purposes of 

6 promoting renewable energy production, including 

7 programs that promote technologies that reduce the 

8 use of electricity at customer sites such as solar 

9 water heating. 

10 ‘‘(5) GUIDELINES AND CRITERIA.—The Sec11 retary may issue guidelines and criteria for grants 

12 awarded under this subsection. 

13 ‘‘(6) MAINTENANCE OF RECORDS AND EVI14 DENCE OF COMPLIANCE.—State energy offices re15 ceiving grants under this section shall maintain such 

16 records and evidence of compliance as the Secretary 

17 may require. 

18 ‘‘(7) ALLOCATION OF FUNDS.—In allocating 

19 funds under this program, the Secretary shall give 

20 preference— 

21 ‘‘(A) to States in regions that have a dis22 proportionately small share of economically sus23 tainable renewable energy generation capacity; 

24 and 


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1 ‘‘(B) to State programs to stimulate or en2 hance innovative renewable energy technologies. 

3 ‘‘(f) RULES.—Not later than 1 year after the date 

4 of enactment of this section, the Secretary shall issue rules 

5 implementing this section. 

6 ‘‘(g) EXEMPTIONS.—This section shall not apply in 

7 any calendar year to an electric utility that— 

8 ‘‘(1) sold less than 4,000,000 megawatt-hours 

9 of electric energy to electric consumers during the 

10 preceding calendar year; or 

11 ‘‘(2) is located in Hawaii. 

12 ‘‘(h) INFLATION ADJUSTMENT.—Not later than De13 cember 31 of each year beginning in 2008, the Secretary 

14 shall adjust for inflation the price of a renewable energy 

15 credit under subsection (c)(2)(B) and the amount of the 

16 civil penalty per kilowatt-hour under subsection (d)(2). 

17 ‘‘(i) STATE PROGRAMS.— 

18 ‘‘(1) IN GENERAL.—Nothing in this section 

19 shall diminish any authority of a State or political 

20 subdivision thereof to adopt or enforce any law or 

21 regulation respecting renewable energy, but, except 

22 as provided in subsection (d)(3), no such law or reg23 ulation shall relieve any person of any requirement 

24 otherwise applicable under this section. 


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1 ‘‘(2) FEDERAL-STATE COORDINATION.—The 

2 Secretary, in consultation with States having renew3 able energy programs, shall, to the maximum extent 

4 practicable, facilitate coordination between the Fed5 eral program and State programs. 

6 ‘‘(j) TERMINATION OF AUTHORITY.—This section 

7 and the authority provided by this section terminate on 

8 December 31, 2030.’’. 

9 SEC. 505. EXTENSION AND EXPANSION OF CLEAN RENEW10 ABLE ENERGY BONDS. 

11 (a) EXTENSION.—Section 54(m) of the Internal Rev12 enue Code of 1986 (relating to termination) is amended 

13 by striking ‘‘2007’’ and inserting ‘‘2012’’. 

14 (b) ANNUAL VOLUME CAP FOR BONDS ISSUED DUR15 ING EXTENSION PERIOD.—Paragraph (1) of section 54(f) 

16 of the Internal Revenue Code of 1986 (relating to limita17 tion on amount of bonds designated) is amended to read 

18 as follows: 

19 ‘‘(1) NATIONAL LIMITATION.— 

20 ‘‘(A) INITIAL NATIONAL LIMITATION.— 

21 With respect to bonds issued after December 

22 31, 2005, and before January 1, 2008, there is 

23 a national clean renewable energy bond limita24 tion of $800,000,000. 


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1 ‘‘(B) ANNUAL NATIONAL LIMITATION.— 

2 With respect to bonds issued after December 

3 31, 2007, and before January 1, 2013, there is 

4 a national clean renewable energy bond limita5 tion for each calendar year of 

6 $1,000,000,000.’’. 

7 (c) EFFECTIVE DATE.—The amendments made by 

8 this section shall apply to bonds issued after the date of 

9 the enactment of this Act. 

10 SEC. 506. CREDIT FOR WIND ENERGY PROPERTY IN11 STALLED IN RESIDENCES AND BUSINESSES. 

12 (a) IN GENERAL.—Subpart B of part IV of sub13 chapter A of chapter 1 of the Internal Revenue Code of 

14 1986, as amended by this Act, is amended by inserting 

15 after section 30C the following new section: 

16 ‘‘SEC. 30E. WIND ENERGY PROPERTY. 

17 ‘‘(a) ALLOWANCE OF CREDIT.—There shall be al18 lowed as a credit against the tax imposed by this chapter 

19 for the taxable year an amount equal to 30 percent of the 

20 amount paid or incurred by the taxpayer for qualified wind 

21 energy property placed in service or installed during such 

22 taxable year. 

23 ‘‘(b) LIMITATIONS.— 

24 ‘‘(1) IN GENERAL.—The credit allowed under 

25 subsection (a) (determined without regard to paraVerDate Aug 31 2005 21:34 Apr 14, 2006 Jkt 049200 PO 00000 Frm 00099 Fmt 6652 Sfmt 6201 E:\BILLS\S2571.IS S2571

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1 graph (2)) for any taxable year shall not exceed 

2 $10,000. 

3 ‘‘(2) LIMITATION BASED ON AMOUNT OF

4 TAX.— 

5 ‘‘(A) IN GENERAL.—The credit allowed 

6 under subsection (a) for any taxable year shall 

7 not exceed the excess of— 

8 ‘‘(i) the sum of the regular tax liabil9 ity (as defined in section 26(b)) plus the 

10 tax imposed by section 55, over 

11 ‘‘(ii) the sum of the credits allowable 

12 under this part (other than under this sec13 tion and subpart C thereof, relating to re14 fundable credits) and section 1397E. 

15 ‘‘(B) CARRYOVER OF UNUSED CREDIT.—If 

16 the credit allowable under subsection (a) ex17 ceeds the limitation imposed by subparagraph 

18 (A) for such taxable year, such excess shall be 

19 carried to the succeeding taxable year and 

20 added to the credit allowable under subsection 

21 (a) for such taxable year. 

22 ‘‘(c) QUALIFIED WIND ENERGY PROPERTY.—For 

23 purposes of this section, the term ‘qualified wind energy 

24 property’ means a wind turbine if— 


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1 ‘‘(1) such turbine is placed in service or in2 stalled on or in connection with property located in 

3 the United States, 

4 ‘‘(2) in the case of an individual, the property 

5 on or in connection with which such turbine is in6 stalled is a dwelling unit which is used as a resi7 dence by the taxpayer, 

8 ‘‘(3) such turbine is used to generate electricity 

9 for the property on or in connection with which it 

10 is installed, and 

11 ‘‘(4) the original use of such turbine commences 

12 with the taxpayer. 

13 ‘‘(d) SPECIAL RULES.—For purposes of this sec14 tion— 

15 ‘‘(1) TENANT-STOCKHOLDER IN COOPERATIVE

16 HOUSING CORPORATION.—In the case of an indi17 vidual who is a tenant-stockholder (as defined in sec18 tion 216(b)(2)) in a cooperative housing corporation 

19 (as defined in section 216(b)(1)), such individual 

20 shall be treated as having paid his tenant-stock21 holder’s proportionate share (as defined in section 

22 216(b)(3)) of any expenditures paid or incurred for 

23 qualified wind energy property by such corporation, 

24 and such credit shall be allocated appropriately to 

25 such individual. 


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1 ‘‘(2) CONDOMINIUMS.— 

2 ‘‘(A) IN GENERAL.—In the case of an indi3 vidual who is a member of a condominium man4 agement association with respect to a condo5 minium which he owns, such individual shall be 

6 treated as having paid his proportionate share 

7 of expenditures paid or incurred for qualified 

8 wind energy property by such association, and 

9 such credit shall be allocated appropriately to 

10 such individual. 

11 ‘‘(B) CONDOMINIUM MANAGEMENT ASSO12 CIATION.—For purposes of this paragraph, the 

13 term ‘condominium management association’ 

14 means an organization which meets the require15 ments of section 528(c)(2) with respect to a 

16 condominium project of which substantially all 

17 of the units are used by individuals as resi18 dences. 

19 ‘‘(3) LABOR COSTS; PROPERTY SUBSIDIZED BY

20 ENERGY FINANCING.—Rules similar to the rules of 

21 paragraphs (1) and (9) of section 25D(e) shall apply 

22 for purposes of this section. 

23 ‘‘(e) BASIS ADJUSTMENT.—For purposes of this sub24 title, if a credit is allowed under this section for any ex25 penditure with respect to a residence or other property, 


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1 the basis of such residence or other property shall be re2 duced by the amount of the credit so allowed. 

3 ‘‘(f) TERMINATION.—The credit allowed under this 

4 section shall not apply to property placed in service or in5 stalled after December 31, 2011.’’. 

6 (b) CONFORMING AMENDMENT.—Subsection (a) of 

7 section 1016 of the Internal Revenue Code of 1986 (relat8 ing to general rule for adjustments to basis) is amended 

9 by striking ‘‘and’’ at the end of paragraph (36), by strik10 ing the period at the end of paragraph (37) and inserting 

11 ‘‘, and’’, and by adding at the end the following new para12 graph: 

13 ‘‘(38) in the case of a residence or other prop14 erty with respect to which a credit was allowed 

15 under section 30E, to the extent provided in section 

16 30E(e).’’. 

17 (c) CLERICAL AMENDMENT.—The table of sections 

18 for subpart B of part IV of subchapter A of chapter 1 

19 of the Internal Revenue Code of 1986 is amended by in20 serting after the item relating to section 30D the following 

21 new item: 

‘‘Sec. 30E. Wind energy property.’’. 

22 (d) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to taxable years ending after De24 cember 31, 2006. 


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1 SEC. 507. EXTENSION OF BUSINESS SOLAR INVESTMENT 

2 CREDIT. 

3 (a) ENERGY PERCENTAGE.—Subclause (II) of sec4 tion 48(a)(2)(A)(i) of the Internal Revenue Code of 1986 

5 is amended by striking ‘‘January 1, 2008’’ and inserting 

6 ‘‘January 1, 2013’’. 

7 (b) HYBRID SOLAR LIGHTING SYSTEMS.—Clause (ii) 

8 of section 48(a)(3)(A) of the Internal Revenue Code of 

9 1986 is amended by striking ‘‘January 1, 2008’’ and in10 serting ‘‘January 1, 2013’’. 

11 (c) SOLAR INVESTMENT CREDIT ALLOWED FOR PUB12 LIC UTILITY PROPERTY.—The second sentence of section 

13 48(a)(3) of the Internal Revenue Code of 1986 is amended 

14 by inserting ‘‘(other than property described in clause (i) 

15 or (ii) of subparagraph (A))’’ before ‘‘shall not’’. 

16 (d) EFFECTIVE DATE.—The amendments made by 

17 this section shall apply to periods after the date of the 

18 enactment of this Act, in taxable years ending after such 

19 date, under rules similar to the rules of section 48(m) of 

20 the Internal Revenue Code of 1986 (as in effect on the 

21 day before the date of the enactment of the Revenue Rec22 onciliation Act of 1990). 


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1 SEC. 508. EXTENSION OF CREDIT RESIDENTIAL ENERGY EF2 FICIENT PROPERTY. 

3 (a) IN GENERAL.—Section 25D(g) of the Internal 

4 Revenue Code of 1986 is amended by striking ‘‘December 

5 31, 2007’’ and inserting ‘‘December 31, 2012’’. 

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

7 this section shall apply to property placed in service after 

8 the date of the enactment of this Act, in taxable years 

9 ending after such date. 

10 SEC. 509. CLEAN ENERGY COAL BONDS. 

11 (a) IN GENERAL.—Subpart H of part IV of sub12 chapter A of chapter 1 of the Internal Revenue Code of 

13 1986 is amended by adding at the end the following new 

14 section: 

15 ‘‘SEC. 54A. CREDIT TO HOLDERS OF CLEAN ENERGY COAL 

16 BONDS. 

17 ‘‘(a) ALLOWANCE OF CREDIT.—If a taxpayer holds 

18 a clean energy coal bond on 1 or more credit allowance 

19 dates of the bond occurring during any taxable year, there 

20 shall be allowed as a credit against the tax imposed by 

21 this chapter for the taxable year an amount equal to the 

22 sum of the credits determined under subsection (b) with 

23 respect to such dates. 

24 ‘‘(b) AMOUNT OF CREDIT.— 

25 ‘‘(1) IN GENERAL.—The amount of the credit 

26 determined under this subsection with respect to any 


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1 credit allowance date for a clean energy coal bond is 

2 25 percent of the annual credit determined with re3 spect to such bond. 

4 ‘‘(2) ANNUAL CREDIT.—The annual credit de5 termined with respect to any clean energy coal bond 

6 is the product of— 

7 ‘‘(A) the credit rate determined by the Sec8 retary under paragraph (3) for the day on 

9 which such bond was sold, multiplied by 

10 ‘‘(B) the outstanding face amount of the 

11 bond. 

12 ‘‘(3) DETERMINATION.—For purposes of para13 graph (2), with respect to any clean energy coal 

14 bond, the Secretary shall determine daily or cause to 

15 be determined daily a credit rate which shall apply 

16 to the first day on which there is a binding, written 

17 contract for the sale or exchange of the bond. The 

18 credit rate for any day is the credit rate which the 

19 Secretary or the Secretary’s designee estimates will 

20 permit the issuance of clean energy coal bonds with 

21 a specified maturity or redemption date without dis22 count and without interest cost to the qualified 

23 issuer. 


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1 ‘‘(4) CREDIT ALLOWANCE DATE.—For purposes 

2 of this section, the term ‘credit allowance date’ 

3 means— 

4 ‘‘(A) March 15, 

5 ‘‘(B) June 15, 

6 ‘‘(C) September 15, and 

7 ‘‘(D) December 15. 

8 Such term also includes the last day on which the 

9 bond is outstanding. 

10 ‘‘(5) SPECIAL RULE FOR ISSUANCE AND RE11 DEMPTION.—In the case of a bond which is issued 

12 during the 3-month period ending on a credit allow13 ance date, the amount of the credit determined 

14 under this subsection with respect to such credit al15 lowance date shall be a ratable portion of the credit 

16 otherwise determined based on the portion of the 3- 

17 month period during which the bond is outstanding. 

18 A similar rule shall apply when the bond is redeemed 

19 or matures. 

20 ‘‘(c) LIMITATION BASED ON AMOUNT OF TAX.—The 

21 credit allowed under subsection (a) for any taxable year 

22 shall not exceed the excess of— 

23 ‘‘(1) the sum of the regular tax liability (as de24 fined in section 26(b)) plus the tax imposed by sec25 tion 55, over 


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1 ‘‘(2) the sum of the credits allowable under this 

2 part (other than subpart C thereof (relating to re3 fundable credits) and this section) and section 

4 1397E. 

5 ‘‘(d) CLEAN ENERGY COAL BOND.—For purposes of 

6 this section— 

7 ‘‘(1) IN GENERAL.—The term ‘clean energy 

8 coal bond’ means any bond issued as part of an 

9 issue if— 

10 ‘‘(A) the bond is issued by a qualified 

11 issuer pursuant to an allocation by the Sec12 retary to such issuer of a portion of the na13 tional clean energy coal bond limitation under 

14 subsection (f)(2), 

15 ‘‘(B) 95 percent or more of the proceeds 

16 from the sale of such issue are to be used for 

17 capital expenditures incurred by qualified bor18 rowers for 1 or more qualified projects, 

19 ‘‘(C) the qualified issuer designates such 

20 bond for purposes of this section and the bond 

21 is in registered form, and 

22 ‘‘(D) the issue meets the requirements of 

23 subsection (h). 

24 ‘‘(2) QUALIFIED PROJECT; SPECIAL USE

25 RULES.— 


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

2 project’ means a qualifying advanced coal 

3 project (as defined in section 48A(c)(1)) placed 

4 in service by a qualified borrower. 

5 ‘‘(B) REFINANCING RULES.—For purposes 

6 of paragraph (1)(B), a qualified project may be 

7 refinanced with proceeds of a clean energy coal 

8 bond only if the indebtedness being refinanced 

9 (including any obligation directly or indirectly 

10 refinanced by such indebtedness) was originally 

11 incurred by a qualified borrower after the date 

12 of the enactment of this section. 

13 ‘‘(C) REIMBURSEMENT.—For purposes of 

14 paragraph (1)(B), a clean energy coal bond 

15 may be issued to reimburse a qualified borrower 

16 for amounts paid after the date of the enact17 ment of this section with respect to a qualified 

18 project, but only if— 

19 ‘‘(i) prior to the payment of the origi20 nal expenditure, the qualified borrower de21 clared its intent to reimburse such expendi22 ture with the proceeds of a clean energy 

23 coal bond, 

24 ‘‘(ii) not later than 60 days after pay25 ment of the original expenditure, the qualiVerDate Aug 31 2005 21:34 Apr 14, 2006 Jkt 049200 PO 00000 Frm 00109 Fmt 6652 Sfmt 6201 E:\BILLS\S2571.IS S2571

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1 fied issuer adopts an official intent to re2 imburse the original expenditure with such 

3 proceeds, and 

4 ‘‘(iii) the reimbursement is made not 

5 later than 18 months after the date the 

6 original expenditure is paid. 

7 ‘‘(D) TREATMENT OF CHANGES IN USE.— 

8 For purposes of paragraph (1)(B), the proceeds 

9 of an issue shall not be treated as used for a 

10 qualified project to the extent that a qualified 

11 borrower takes any action within its control 

12 which causes such proceeds not to be used for 

13 a qualified project. The Secretary shall pre14 scribe regulations specifying remedial actions 

15 that may be taken (including conditions to tak16 ing such remedial actions) to prevent an action 

17 described in the preceding sentence from caus18 ing a bond to fail to be a clean energy coal 

19 bond. 

20 ‘‘(e) MATURITY LIMITATIONS.— 

21 ‘‘(1) DURATION OF TERM.—A bond shall not be 

22 treated as a clean energy coal bond if the maturity 

23 of such bond exceeds the maximum term determined 

24 by the Secretary under paragraph (2) with respect 

25 to such bond. 


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1 ‘‘(2) MAXIMUM TERM.—During each calendar 

2 month, the Secretary shall determine the maximum 

3 term permitted under this paragraph for bonds 

4 issued during the following calendar month. Such 

5 maximum term shall be the term which the Sec6 retary estimates will result in the present value of 

7 the obligation to repay the principal on the bond 

8 being equal to 50 percent of the face amount of such 

9 bond. Such present value shall be determined using 

10 as a discount rate the average annual interest rate 

11 of tax of tax-exempt obligations having a term of 10 

12 years or more which are issued during the month. If 

13 the term as so determined is not a multiple of a 

14 whole year, such term shall be rounded to the next 

15 highest whole year. 

16 ‘‘(3) RATABLE PRINCIPAL AMORTIZATION RE17 QUIRED.—A bond shall not be treated as a clean en18 ergy coal bond unless it is part of an issue which 

19 provides for an equal amount of principal to be paid 

20 by the qualified issuer during each calendar year 

21 that the issue is outstanding. 

22 ‘‘(f) LIMITATION ON AMOUNT OF BONDS DES23 IGNATED.— 


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1 ‘‘(1) NATIONAL LIMITATION.—There is a na2 tional clean energy coal bond limitation of 

3 $1,000,000,000. 

4 ‘‘(2) ALLOCATION BY SECRETARY.—The Sec5 retary shall allocate the amount described in para6 graph (1) among qualified projects in such manner 

7 as the Secretary determines appropriate. 

8 ‘‘(g) CREDIT INCLUDED IN GROSS INCOME.—Gross 

9 income includes the amount of the credit allowed to the 

10 taxpayer under this section (determined without regard to 

11 subsection (c)) and the amount so included shall be treat12 ed as interest income. 

13 ‘‘(h) SPECIAL RULES RELATING TO EXPENDI14 TURES.— 

15 ‘‘(1) IN GENERAL.—An issue shall be treated as 

16 meeting the requirements of this subsection if, as of 

17 the date of issuance, the qualified issuer reasonably 

18 expects— 

19 ‘‘(A) at least 95 percent of the proceeds 

20 from the sale of the issue are to be spent for 

21 1 or more qualified projects within the 5-year 

22 period beginning on the date of issuance of the 

23 clean energy bond, 

24 ‘‘(B) a binding commitment with a third 

25 party to spend at least 10 percent of the proVerDate Aug 31 2005 21:34 Apr 14, 2006 Jkt 049200 PO 00000 Frm 00112 Fmt 6652 Sfmt 6201 E:\BILLS\S2571.IS S2571

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1 ceeds from the sale of the issue will be incurred 

2 within the 6-month period beginning on the 

3 date of issuance of the clean energy bond or, in 

4 the case of a clean energy bond the proceeds of 

5 which are to be loaned to 2 or more qualified 

6 borrowers, such binding commitment will be in7 curred within the 6-month period beginning on 

8 the date of the loan of such proceeds to a quali9 fied borrower, and 

10 ‘‘(C) such projects will be completed with 

11 due diligence and the proceeds from the sale of 

12 the issue will be spent with due diligence. 

13 ‘‘(2) EXTENSION OF PERIOD.—Upon submis14 sion of a request prior to the expiration of the period 

15 described in paragraph (1)(A), the Secretary may 

16 extend such period if the qualified issuer establishes 

17 that the failure to satisfy the 5-year requirement is 

18 due to reasonable cause and the related projects will 

19 continue to proceed with due diligence. 

20 ‘‘(3) FAILURE TO SPEND REQUIRED AMOUNT

21 OF BOND PROCEEDS WITHIN 5 YEARS.—To the ex22 tent that less than 95 percent of the proceeds of 

23 such issue are expended by the close of the 5-year 

24 period beginning on the date of issuance (or if an 

25 extension has been obtained under paragraph (2), by 


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1 the close of the extended period), the qualified issuer 

2 shall redeem all of the nonqualified bonds within 90 

3 days after the end of such period. For purposes of 

4 this paragraph, the amount of the nonqualified 

5 bonds required to be redeemed shall be determined 

6 in the same manner as under section 142. 

7 ‘‘(i) SPECIAL RULES RELATING TO ARBITRAGE.—A 

8 bond which is part of an issue shall not be treated as a 

9 clean energy coal bond unless, with respect to the issue 

10 of which the bond is a part, the qualified issuer satisfies 

11 the arbitrage requirements of section 148 with respect to 

12 proceeds of the issue. 

13 ‘‘(j) COOPERATIVE ELECTRIC COMPANY; QUALIFIED

14 ENERGY TAX CREDIT BOND LENDER; GOVERNMENTAL

15 BODY; QUALIFIED BORROWER.—For purposes of this sec16 tion— 

17 ‘‘(1) COOPERATIVE ELECTRIC COMPANY.—The 

18 term ‘cooperative electric company’ means a mutual 

19 or cooperative electric company described in section 

20 501(c)(12) or section 1381(a)(2)(C), or a not-for21 profit electric utility which has received a loan or 

22 loan guarantee under the Rural Electrification Act. 

23 ‘‘(2) CLEAN ENERGY BOND LENDER.—The 

24 term ‘clean energy bond lender’ means a lender 

25 which is a cooperative which is owned by, or has outVerDate Aug 31 2005 21:34 Apr 14, 2006 Jkt 049200 PO 00000 Frm 00114 Fmt 6652 Sfmt 6201 E:\BILLS\S2571.IS S2571

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1 standing loans to, 100 or more cooperative electric 

2 companies and is in existence on February 1, 2002, 

3 and shall include any affiliated entity which is con4 trolled by such lender. 

5 ‘‘(3) GOVERNMENTAL BODY.—The term ‘gov6 ernmental body’ means any State, territory, posses7 sion of the United States, the District of Columbia, 

8 Indian tribal government, and any political subdivi9 sion thereof. 

10 ‘‘(4) QUALIFIED ISSUER.—The term ‘qualified 

11 issuer’ means— 

12 ‘‘(A) a clean energy bond lender, 

13 ‘‘(B) a cooperative electric company, 

14 ‘‘(C) a governmental body, or 

15 ‘‘(D) the Tennessee Valley Authority. 

16 ‘‘(5) QUALIFIED BORROWER.—The term ‘quali17 fied borrower’ means— 

18 ‘‘(A) a mutual or cooperative electric com19 pany described in section 501(c)(12) or 

20 1381(a)(2)(C), 

21 ‘‘(B) a governmental body, or 

22 ‘‘(C) the Tennessee Valley Authority. 

23 ‘‘(k) SPECIAL RULES RELATING TO POOL BONDS.— 

24 No portion of a pooled financing bond may be allocable 

25 to any loan unless the borrower has entered into a written 


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1 loan commitment for such portion prior to the issue date 

2 of such issue. 

3 ‘‘(l) OTHER DEFINITIONS AND SPECIAL RULES.— 

4 For purposes of this section— 

5 ‘‘(1) BOND.—The term ‘bond’ includes any ob6 ligation. 

7 ‘‘(2) POOLED FINANCING BOND.—The term 

8 ‘pooled financing bond’ shall have the meaning given 

9 such term by section 149(f)(4)(A). 

10 ‘‘(3) PARTNERSHIP; S CORPORATION; AND

11 OTHER PASS-THRU ENTITIES.— 

12 ‘‘(A) IN GENERAL.—Under regulations 

13 prescribed by the Secretary, in the case of a 

14 partnership, trust, S corporation, or other pass15 thru entity, rules similar to the rules of section 

16 41(g) shall apply with respect to the credit al17 lowable under subsection (a). 

18 ‘‘(B) NO BASIS ADJUSTMENT.—Rules simi19 lar to the rules under section 1397E(i)(2) shall 

20 apply. 

21 ‘‘(4) BONDS HELD BY REGULATED INVEST22 MENT COMPANIES.—If any clean energy coal bond is 

23 held by a regulated investment company, the credit 

24 determined under subsection (a) shall be allowed to 


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1 shareholders of such company under procedures pre2 scribed by the Secretary. 

3 ‘‘(5) TREATMENT FOR ESTIMATED TAX PUR4 POSES.—Solely for purposes of sections 6654 and 

5 6655, the credit allowed by this section to a tax6 payer by reason of holding a clean energy coal bond 

7 on a credit allowance date shall be treated as if it 

8 were a payment of estimated tax made by the tax9 payer on such date. 

10 ‘‘(6) REPORTING.—Issuers of clean energy coal 

11 bonds shall submit reports similar to the reports re12 quired under section 149(e). 

13 ‘‘(m) TERMINATION.—This section shall not apply 

14 with respect to any bond issued after December 31, 

15 2010.’’. 

16 (b) REPORTING.—Subsection (d) of section 6049 of 

17 the Internal Revenue Code of 1986 (relating to returns 

18 regarding payments of interest) is amended by adding at 

19 the end the following new paragraph: 

20 ‘‘(9) REPORTING OF CREDIT ON CLEAN ENERGY

21 COAL BONDS.— 

22 ‘‘(A) IN GENERAL.—For purposes of sub23 section (a), the term ‘interest’ includes amounts 

24 includible in gross income under section 54A(g) 

25 and such amounts shall be treated as paid on 


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1 the credit allowance date (as defined in section 

2 54A(b)(4)). 

3 ‘‘(B) REPORTING TO CORPORATIONS, 

4 ETC.—Except as otherwise provided in regula5 tions, in the case of any interest described in 

6 subparagraph (A), subsection (b)(4) shall be 

7 applied without regard to subparagraphs (A), 

8 (H), (I), (J), (K), and (L)(i) of such subsection. 

9 ‘‘(C) REGULATORY AUTHORITY.—The Sec10 retary may prescribe such regulations as are 

11 necessary or appropriate to carry out the pur12 poses of this paragraph, including regulations 

13 which require more frequent or more detailed 

14 reporting.’’. 

15 (c) CLERICAL AMENDMENT.—The table of sections 

16 for subpart H of part IV of subchapter A of chapter 1 

17 of the Internal Revenue Code of 1986 is amended by add18 ing at the end the following new item: 

‘‘Sec. 54A. Credit to holders of clean energy coal bonds.’’. 

19 (d) ISSUANCE OF REGULATIONS.—The Secretary of 

20 the Treasury shall issues regulations required under sec21 tion 54A of the Internal Revenue Code of 1986 (as added 

22 by this section) not later than 120 days after the date 

23 of the enactment of this Act. 


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

2 this section shall apply to bonds issued after December 

3 31, 2006. 

4 SEC. 510. INCREASE IN CREDIT LIMITATION FOR QUALI5 FYING GASIFICATION PROJECTS. 

6 (a) IN GENERAL.—Paragraph (1) of section 48B(d) 

7 of the Internal Revenue Code of 1986 is amended by strik8 ing ‘‘$350,000,000’’ and inserting ‘‘$4,000,000,000’’. 

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

10 this section shall take effect as if included in section 1307 

11 of the Energy Policy Act of 2005. 

12 SEC. 511. MODIFICATION OF QUALIFYING ADVANCED COAL 

13 PROJECT CREDIT. 

14 (a) IN GENERAL.—Subparagraph (C) of section 

15 48A(e)(1) of the Internal Revenue Code of 1986 is amend16 ed by inserting ‘‘(300 megawatts in the case of projects 

17 using subbituminous or lignite as a primary feedstock)’’ 

18 after ‘‘400 megawatts’’. 

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

20 this section shall take effect as if included in section 1307 

21 of the Energy Policy Act of 2005. 

22 SEC. 512. GREAT PLAINS SYNFUELS TRUST. 

23 (a) IN GENERAL.—Not later than 90 days after the 

24 date of enactment of this Act, the Secretary shall— 


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1 (1) establish a trust to be known as the ‘‘Great 

2 Plains Synfuels Trust’’ (referred to in this section as 

3 the ‘‘Trust’’); and 

4 (2) deposit in the Trust 50 percent of the rev5 enue-sharing payments that would otherwise be re6 ceived under the asset purchase agreement between 

7 the Secretary and the Dakota Gasification Company, 

8 dated October 7, 1988, and as in effect on the date 

9 of enactment of this Act, as a result of the operation 

10 of the Great Plains Synfuels Plant. 

11 (b) COAL DEVELOPMENT PROGRAM.—Not later than 

12 180 days after the date of enactment of this Act, the Sec13 retary shall— 

14 (1) establish an advanced clean low-rank coal 

15 development program; and 

16 (2) use funds from the Trust, on such cost17 sharing basis as the Secretary shall establish, to 

18 carry out the program at the Great Plains Synfuels 

19 Plant. 

20 TITLE VI—ENERGY EFFICIENCY 

21 SEC. 601. ENERGY CREDIT FOR COMBINED HEAT AND 

22 POWER SYSTEM PROPERTY. 

23 (a) IN GENERAL.—Section 48(a)(3)(A) of the Inter24 nal Revenue Code of 1986 (defining energy property) is 

25 by striking ‘‘or’’ at the end of clause (iii), by inserting 


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1 ‘‘or’’ at the end of clause (iv), and by adding at the end 

2 the following new clause: 

3 ‘‘(v) combined heat and power system 

4 property,’’. 

5 (b) COMBINED HEAT AND POWER SYSTEM PROP6 ERTY.—Section 48 of the Internal Revenue Code of 1986 

7 is amended by adding at the end the following new sub8 section: 

9 ‘‘(d) COMBINED HEAT AND POWER SYSTEM PROP10 ERTY.—For purposes of subsection (a)(3)(A)(v)— 

11 ‘‘(1) COMBINED HEAT AND POWER SYSTEM

12 PROPERTY.—The term ‘combined heat and power 

13 system property’ means property comprising a sys14 tem— 

15 ‘‘(A) which uses the same energy source 

16 for the simultaneous or sequential generation of 

17 electrical power, mechanical shaft power, or 

18 both, in combination with the generation of 

19 steam or other forms of useful thermal energy 

20 (including heating and cooling applications), 

21 ‘‘(B) which has an electrical capacity of 

22 not more than 15 megawatts or a mechanical 

23 energy capacity of not more than 2,000 horse24 power or an equivalent combination of electrical 

25 and mechanical energy capacities, 


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1 ‘‘(C) which produces— 

2 ‘‘(i) at least 20 percent of its total 

3 useful energy in the form of thermal en4 ergy which is not used to produce electrical 

5 or mechanical power (or combination 

6 thereof), and 

7 ‘‘(ii) at least 20 percent of its total 

8 useful energy in the form of electrical or 

9 mechanical power (or combination thereof), 

10 ‘‘(D) the energy efficiency percentage of 

11 which exceeds 60 percent, and 

12 ‘‘(E) which is placed in service before Jan13 uary 1, 2011. 

14 ‘‘(2) SPECIAL RULES.— 

15 ‘‘(A) ENERGY EFFICIENCY PERCENT16 AGE.—For purposes of this subsection, the en17 ergy efficiency percentage of a system is the 

18 fraction— 

19 ‘‘(i) the numerator of which is the 

20 total useful electrical, thermal, and me21 chanical power produced by the system at 

22 normal operating rates, and expected to be 

23 consumed in its normal application, and 


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1 ‘‘(ii) the denominator of which is the 

2 lower heating value of the fuel sources for 

3 the system. 

4 ‘‘(B) DETERMINATIONS MADE ON BTU

5 BASIS.—The energy efficiency percentage and 

6 the percentages under paragraph (1)(C) shall 

7 be determined on a Btu basis. 

8 ‘‘(C) INPUT AND OUTPUT PROPERTY NOT

9 INCLUDED.—The term ‘combined heat and 

10 power system property’ does not include prop11 erty used to transport the energy source to the 

12 facility or to distribute energy produced by the 

13 facility. 

14 ‘‘(D) CERTAIN EXCEPTION NOT TO

15 APPLY.—The first sentence of the matter in 

16 subsection (a)(3) which follows subparagraph 

17 (D) thereof shall not apply to combined heat 

18 and power system property. 

19 ‘‘(3) SYSTEMS USING BAGASSE.—If a system is 

20 designed to use bagasse for at least 90 percent of 

21 the energy source— 

22 ‘‘(A) paragraph (1)(D) shall not apply, but 

23 ‘‘(B) the amount of credit determined 

24 under subsection (a) with respect to such sys25 tem shall not exceed the amount which bears 


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1 the same ratio to such amount of credit (deter2 mined without regard to this paragraph) as the 

3 energy efficiency percentage of such system 

4 bears to 60 percent.’’. 

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

6 this section shall apply to periods after December 31, 

7 2006, in taxable years ending after such date, under rules 

8 similar to the rules of section 48(m) of the Internal Rev9 enue Code of 1986 (as in effect on the day before the date 

10 of the enactment of the Revenue Reconciliation Act of 

11 1990). 

12 SEC. 602. EXTENSION OF NEW ENERGY EFFICIENT HOME 

13 CREDIT. 

14 (a) IN GENERAL.—Section 45L(g) of the Internal 

15 Revenue Code of 1986 is amended by striking ‘‘December 

16 31, 2007’’ and inserting ‘‘December 31, 2010’’. 

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

18 this section shall apply to qualified new energy efficient 

19 homes acquired after the date of enactment of this Act, 

20 in taxable years ending after such date. 

21 SEC. 603. MODIFICATION AND EXTENSION OF ENERGY EF22 FICIENT COMMERCIAL BUILDINGS DEDUC23 TION. 

24 (a) INCREASE IN CREDIT AMOUNT.— 


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1 (1) IN GENERAL.—Subparagraph (A) of section 

2 179D(b)(1) of the Internal Revenue Code of 1986 is 

3 amended by striking ‘‘$1.80’’ and inserting ‘‘$2.25’’. 

4 (2) PARTIAL ALLOWANCE.—Subparagraph (A) 

5 of section 179D(1) of such Code is amended— 

6 (A) by striking ‘‘$.60’’ and inserting 

7 ‘‘$.75’’, and 

8 (B) by striking ‘‘$1.80’’ and inserting 

9 ‘‘$2.25’’. 

10 (b) EXTENSION.—Section 179D(g) of the Internal 

11 Revenue Code of 1986 is amended by striking ‘‘December 

12 31, 2007’’ and inserting ‘‘December 31, 2010’’. 

13 (c) EFFECTIVE DATE.—The amendments made by 

14 this section shall apply to property placed in service after 

15 December 31, 2006. 

16 SEC. 604. EXTENSION OF NONBUSINESS ENERGY PROP17 ERTY. 

18 (a) IN GENERAL.—Section 25C(g) of the Internal 

19 Revenue Code of 1986 is amended by striking ‘‘December 

20 31, 2007’’ and inserting ‘‘December 31, 2010’’. 

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

22 this section shall apply to property placed in service after 

23 the date of the enactment of this Act. 

Æ 


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