II 

109TH CONGRESS 

2D SESSION S. 2829 

To reduce the addiction of the United States to oil, to ensure near-term 

energy affordability and empower American families, to accelerate clean 

fuels and electricity, to provide government leadership for clean and 

secure energy, to secure a reliable, affordable, and sustainable energy 

future, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MAY 17, 2006 

Ms. CANTWELL (for herself, Mr. REID, Mr. DURBIN, Ms. MIKULSKI, Mr. 

DODD, Mr. MENENDEZ, Mr. CARPER, Mr. DAYTON, Mr. KERRY, Mr. 

REED, Mr. BINGAMAN, Mrs. FEINSTEIN, Mr. HARKIN, Mr. SALAZAR, Mr. 

SCHUMER, Mr. DORGAN, Mrs. CLINTON, Mr. LEAHY, Mr. JOHNSON, Mrs. 

BOXER, Mr. LIEBERMAN, Mr. BYRD, Ms. STABENOW, Mr. LEVIN, and 

Mr. BIDEN) introduced the following bill; which was read twice and referred to the Committee on Finance 

A BILL 

To reduce the addiction of the United States to oil, to 

ensure near-term energy affordability and empower 

American families, to accelerate clean fuels and electricity, to provide government leadership for clean and 

secure energy, to secure a reliable, affordable, and sustainable energy future, 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, 


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1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

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

3 ‘‘Clean Energy Development for a Growing Economy Act 

4 of 2006’’ or the ‘‘Clean EDGE Act of 2006’’. 

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

6 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Findings and purposes. 

TITLE I—REDUCING OUR ADDICTION TO OIL 

Subtitle A—Reducing Oil Consumption by 2020 

Sec. 101. Setting a national oil savings goal. 

Subtitle B—Biofuels Infrastructure 

Sec. 111. Modification of alternative fuel vehicle refueling property credit. 

Sec. 112. Alternative fuel-related standards. 

Sec. 113. Accelerating conversion to alternative fuels infrastructure. 

Sec. 114. Low- interest loan program for farmer-owned retail delivery of alternative fuels. 

Sec. 115. Extension of biodiesel income and excise tax credits. 

Sec. 116. Small ethanol producer credit expanded for producers of sucrose and 

cellulosic ethanol. 

Sec. 117. Incentives to produce transportation fuels from cellulosic biomass. 

Sec. 118. Alternative fuels investment by major oil companies and vehicle manufacturers. 

Subtitle C—Flexible Fuel Vehicle Market Penetration 

Sec. 121. Credit for production of qualified flexible fuel vehicles. 

Sec. 122. Ensuring availability of flexible fuel vehicles. 

Sec. 123. Increasing consumer awareness of flexible fuel vehicles. 

Subtitle D—25 by ’25 Renewable Energy and Fuels Vision 

Sec. 131. Presidential authority to increase renewable fuel content of motor 

fuels and clean energy sources. 

Subtitle E—Nationwide Media Campaign to Encourage Energy Efficiency and 

Conservation 

Sec. 141. Nationwide media campaign to encourage energy efficiency and conservation. 

Subtitle F—Increasing Transit Use and Alternative Transportation Modes 

Sec. 151. Transit-Oriented Development Corridors. 

Sec. 152. Increasing transit utilization incentives. 

Sec. 153. Extension of transportation fringe benefit to bicycle commuters. 


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TITLE II—ENSURING NEAR-TERM ENERGY AFFORDABILITY AND 

EMPOWERING AMERICAN FAMILIES 

Subtitle A—Making Gas Price Gouging a Federal Crime 

Sec. 201. Unfair or deceptive acts or practices in commerce related to gasoline 

and petroleum distillates. 

Sec. 202. Enforcement under Federal Trade Commission Act. 

Sec. 203. Enforcement at retail level by State Attorneys General. 

Sec. 204. Penalties. 

Sec. 205. Effect on other laws. 

Subtitle B—Strengthening Anti-Trust Enforcement in the Oil and Gas 

Industry 

Sec. 211. Prohibition on unilateral withholding. 

Sec. 212. Modification of merger standard in Clayton Act. 

Sec. 213. Study by the Government Accountability Office. 

Sec. 214. Joint Federal and State task force. 

Subtitle C—Improving Oversight of Oil and Gas Market Speculation 

Sec. 221. Short title. 

Sec. 222. Reporting and recordkeeping for positions involving energy commodities. 

Subtitle D—Low Income Energy Price Relief 

Sec. 231. Adjustment of standard utility allowance under the food stamp program for high energy costs. 

Sec. 232. Public housing energy cost assistance. 

Sec. 233. Refundable tax credit for low-income residential energy cost assistance. 

Subtitle E—Small Business and Agricultural Producers Energy Emergency 

Relief Program 

Sec. 241. Energy emergency disaster relief loans to small business and agricultural producers. 

Subtitle F—Public Access to Federal Alternative Refueling Stations 

Sec. 251. Access to Federal alternative refueling stations. 

Subtitle G—Measures to Empower Drivers to Realize Improved Fuel 

Economy 

Sec. 261. Improved labeling on new vehicle window stickers. 

Sec. 262. Tire efficiency labeling program. 

Sec. 263. New vehicle options to empower drivers to reduce fuel use. 

Sec. 264. Idling reduction tax credit. 

Subtitle H—Providing Consumers With Additional Advanced Technology 

Vehicle Purchase Incentives 

Sec. 271. Expansion and extension of alternative motor vehicle credit. 

Sec. 272. Plug-in hybrid motor vehicle tax credit. 

Subtitle I—Tax Incentives for Fuel Efficient Private Fleets 


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Sec. 281. Tax credit for fuel-efficient fleets. 

TITLE III— ACCELERATING CLEAN FUELS AND ELECTRICITY 

Subtitle A—Guaranteeing a Minimum Level of Renewable Electricity 

Generation 

Sec. 301. Renewable portfolio standard. 

Subtitle B—Facilitating Home Energy Generation Through Net Metering and 

Interconnection Standards 

Sec. 311. Net metering. 

Subtitle C—Long Term Extensions and Expansions for Clean Energy 

Incentives 

Sec. 321. Extension of production tax credit for electricity produced from certain renewable resources. 

Sec. 322. Extension and modification of investment tax credit with respect to 

solar energy property and qualified fuel cell property. 

Sec. 323. Credit for wind energy systems. 

Sec. 324. Expansion of resources to wave, current, tidal, and ocean thermal energy. 

Sec. 325. Extension and expansion of credit to holders of clean renewable energy bonds. 

Sec. 326. Extension of credit for business installation of qualified fuel cells and 

stationary microturbine power plants. 

Sec. 327. Extension of business solar investment tax credit. 

Sec. 328. Extension of full credit for qualified electric vehicles. 

Subtitle D—Long-Term Extensions and Expansions for Energy Efficiency 

and Conservation Incentives 

Sec. 331. Extension of energy efficient commercial buildings deduction. 

Sec. 332. Extension and expansion of new energy efficient home credit. 

Sec. 333. Extension of nonbusiness energy property credit. 

Sec. 334. Extension and modification of residential energy efficient property 

credit. 

Sec. 335. Energy credit for combined heat and power system property. 

Sec. 336. Three-year applicable recovery period for depreciation of qualified energy management. 

Sec. 337. Three-year applicable recovery period for depreciation of qualified 

water submetering devices. 

Subtitle E—Utilizing America’s Abundant Coal Supplies Cleanly 

Sec. 341. Clean energy coal bonds. 

Sec. 342. Extension and expansion of qualifying advanced coal project credit. 

Sec. 343. Expansion of qualifying gasification project credit. 

Sec. 344. Coal-to-liquid and biomass transportation fuels. 

TITLE IV—REAL GOVERNMENT LEADERSHIP FOR CLEAN AND 

SECURE ENERGY 

Subtitle A—Federal Biofuels and Efficient Vehicle Use Leadership 


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Sec. 401. Federal agency ethanol-blended gasoline and biodiesel purchasing requirement. 

Sec. 402. Use of the existing flexible fuel vehicle fleet of the Federal government. 

Sec. 403. Standards for executive agency automobiles. 

Sec. 404. Federal fleet conservation requirements. 

Subtitle B—Federal Clean and Efficient Energy Leadership 

Sec. 411. Federal leadership on clean energy purchasing. 

Sec. 412. Clean and secure backup power at Federal facilities. 

Sec. 413. Eliminating vampire electronic devices. 

Sec. 414. Promoting Federal leadership in energy management. 

Sec. 415. Retention of savings from energy savings performance contracts. 

Subtitle C—State, Tribal, and Local Clean and Efficient Energy Leadership 

Sec. 421. Freedom from fossil fuels (F4) bonds. 

Sec. 422. Clean energy security collaborative. 

Sec. 423. Assistance for State programs to retire fuel-inefficient motor vehicles. 

Subtitle D—International Clean Energy Deployment 

Sec. 431. Clean energy technology deployment in developing countries. 

TITLE V—SECURING A RELIABLE, AFFORDABLE, AND 

SUSTAINABLE ENERGY FUTURE 

Subtitle A—Advanced Research Project Agency for Energy 

Sec. 501. Office of Advanced Energy Research, Technology Development, and 

Deployment. 

Subtitle B—Near-Term Vehicle Technology Program 

Sec. 505. Near-term vehicle technology program. 

Subtitle C—Advanced Technology Motor Vehicles Manufacturing Credit 

Sec. 511. Advanced technology motor vehicles manufacturing credit. 

Subtitle D—Realizing a Hydrogen Future 

Sec. 521. H-Prize competition. 

Sec. 522. Credit for retail sale of hydrogen fuel as motor vehicle fuel. 

Sec. 523. Credit for production of hydrogen fuel. 

Sec. 524. Tax holiday for hydrogen fuel. 

Sec. 525. Sense of Congress regarding hydrogen fuel taxes. 

Sec. 526. Hydrogen fueling fringe benefit. 

Sec. 527. Exclusion of earnings from hydrogen fuel sales. 

Subtitle E—Building the Skilled Workforce for Advanced Vehicle and Energy 

Technology Deployment 

Sec. 531. Increasing skilled workforce. 

Sec. 532. Grant program for green building and zero-energy home design and 

construction training. 

Subtitle F—Clean Energy Investment Administration 


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Sec. 541. Definitions. 

Sec. 542. Clean Energy Investment Administration. 

Sec. 543. Requirements specific to demonstration projects and commercial deployment projects. 

Sec. 544. Loan guarantee program. 

Sec. 545. Energy park task forces. 

Sec. 546. Authorization of appropriations. 

Subtitle G—Strategic Gasoline and Fuel Reserve 

Sec. 548. Strategic Gasoline and Fuel Reserve. 

Subtitle H—Reports on United States Energy Emergency Preparedness 

Sec. 551. Potential impacts of oil supply shock. 

Sec. 552. Preventing future disruptions. 

Subtitle J—Impacts of Act on Reducing Greenhouse Gas Emissions 

Sec. 561. Climate change and energy policy feedback loop. 

Subtitle K—Energy Fairness for America 

Sec. 571. Elimination of deduction for intangible drilling and development costs 

for major oil companies. 

Sec. 572. Elimination of enhanced oil recovery credit for major oil companies. 

Sec. 573. Oil and gas royalty-related amendments. 

Sec. 574. Extension of election to expense certain refineries. 

Sec. 575. Elimination of amortization of geological and geophysical expenditures for major oil companies. 

Sec. 576. Revaluation of LIFO inventories of major integrated oil companies. 

Sec. 577. Modifications of foreign tax credit rules applicable to major integrated oil companies which are dual capacity taxpayers. 

Sec. 578. Denial of deduction for income attributable to domestic production of 

oil, natural gas, or primary products thereof. 

Sec. 579. Rules relating to foreign oil and gas income. 

Sec. 580. Elimination of deferral for foreign oil and gas extraction income. 

Subtitle L—Protection and Retention of Value of Publicly-Owned Energy 

Resources 

Sec. 591. Suspension of royalty relief. 

Sec. 592. Renegotiation of existing leases. 

1 SEC. 2. FINDINGS AND PURPOSES. 

2 (a) FINDINGS.—Congress finds that— 

3 (1) in his State of the Union address during 

4 January 2006, President George W. Bush acknowl5 edged that ‘‘we have a serious problem: America is 

6 addicted to oil’’; 


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1 (2) the near-total reliance of the transportation 

2 sector and the military of the United States on 

3 crude oil, coupled with the growing dependence of 

4 the United States on foreign oil imports, makes the 

5 economy and national security of the United States 

6 dangerously subject to the willingness of other coun7 tries to provide adequate and affordable energy sup8 plies; 

9 (3) world demand for crude oil and petroleum 

10 products will continue increasing, and the bulk of 

11 the remaining oil and natural gas reserves of the 

12 world are controlled by countries that are members 

13 of the anti-competitive cartel of the Organization of 

14 the Petroleum Exporting Countries (OPEC); 

15 (4) terrorists have identified oil supply depend16 ency as a strategic vulnerability and have increased 

17 attacks against oil infrastructure worldwide and the 

18 critical energy infrastructure of the United States is 

19 also at risk from hurricanes, natural disasters, and 

20 a lack of public and private investment; 

21 (5) in 2005, consumers in the United States 

22 sent more than $230,000,000,000 overseas to pay 

23 for oil and energy products, exacerbating the trade 

24 deficit of the United States, and in some cases inad25 vertently funding unfriendly regimes and political 


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1 groups that threaten the economic, political, and na2 tional security interests of the United States; 

3 (6) households in the United States are now 

4 forced to pay an average of $1,800 more each year 

5 for fossil fuel-derived energy than the households did 

6 5 years ago, and energy expenditures (as a percent7 age of the gross domestic product) have been higher 

8 than the expenditures have been in the last 20 years; 

9 (7) environmentally-sound technology solutions 

10 already exist to substantially increase the produc11 tivity, efficiency, and variety of domestic energy sup12 plies, including nonpetroleum alternatives (such as 

13 biofuels); 

14 (8) instituting simple but cost-effective energy 

15 efficiency and conservation measures can improve 

16 the economic competitiveness of the United States 

17 and quickly lessen energy costs for families in the 

18 United States, all at costs significantly lower than 

19 developing new energy production capacity; 

20 (9) increasing total Federal research and devel21 opment funding and deployment efforts for energy 

22 conservation, renewable and alternative energy re23 sources, and energy efficiency and vehicle tech24 nology, which have largely been stagnant for the last 

25 5 years, could swiftly bring down energy costs, inVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 crease job creation, and create a major new source 

2 of high-value exports; and 

3 (10) as the largest single energy consumer in 

4 the United States, the Federal government has both 

5 a tremendous opportunity and a clear responsibility 

6 to lead by example and provide guaranteed markets 

7 that allow industry to invest in and produce clean 

8 energy technologies. 

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

10 (1) to improve the national, economic, and envi11 ronmental security of the United States by rapidly 

12 reducing foreign oil imports and oil consumption and 

13 creating viable alternative fuel options; 

14 (2) to protect and empower consumers and the 

15 economy by making energy supplies affordable, sta16 ble, and reliable, providing consumers in the United 

17 States with tools to reduce their own energy use, 

18 and preventing market manipulation and price19 gouging; 

20 (3) to create jobs and economic growth through 

21 accelerated domestic clean energy technology deploy22 ment and better targeted investments and long-term 

23 tax incentives; 

24 (4) to expedite the use of the buying power of 

25 the Federal Government to leverage and expand 


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1 markets for clean energy products, buildings, and 

2 vehicles; 

3 (5) to make the United States significantly 

4 more energy independent and provide the United 

5 States with an economic, environmental, and na6 tional security edge that is essential to maintaining 

7 the international competitiveness of, and quality of 

8 life in, the United States; and 

9 (6) to reduce total greenhouse gas emissions to 

10 lower the risk of potentially devastating, wide-rang11 ing impacts associated with global warming. 

12 TITLE I—REDUCING OUR 

13 ADDICTION TO OIL 

14 Subtitle A—Reducing Oil 

15 Consumption by 2020 

16 SEC. 101. SETTING A NATIONAL OIL SAVINGS GOAL. 

17 (a) GOAL.—It is a goal of the United States to reduce 

18 the quantity of oil projected to be imported in 2020 by 

19 40 percent. 

20 (b) MEASURES TO REDUCE IMPORT DEPENDENCE.— 

21 (1) IN GENERAL.—Subject to paragraph (2), 

22 not later than 1 year after the date of enactment of 

23 this Act, and every other year thereafter, the Presi24 dent shall develop and implement measures to re25 duce the dependence of the United States on foreign 


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1 petroleum imports by reducing petroleum in end2 uses throughout the economy of the United States in 

3 a manner that is sufficient to reduce the total de4 mand for petroleum in the United States by— 

5 (A) 1,000,000 barrels per day from the 

6 quantity projected for calendar year 2015; and 

7 (B) 6,000,000 barrels per day from the 

8 quantity projected for calendar year 2020. 

9 (2) INSUFFICIENT LEGAL AUTHORITIES.—If the 

10 President determines that there are insufficient legal 

11 authorities to achieve the target for calendar year 

12 2020 described in paragraph (1)(B), the President 

13 shall— 

14 (A) develop and implement measures that 

15 will reduce the dependence of the United States 

16 on foreign petroleum imports by reducing petro17 leum in end-uses throughout the economy of the 

18 United States to the maximum extent prac19 ticable; and 

20 (B) submit to Congress proposed legisla21 tion or other recommendations to achieve the 

22 target. 

23 (c) REQUIREMENTS.—In developing measures under 

24 subsection (b), the President shall— 


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1 (1) ensure continued reliable and affordable en2 ergy for the United States, consistent with creating 

3 jobs and economic growth and maintaining the inter4 national competitiveness of United States businesses, 

5 including the manufacturing sector; and 

6 (2) implement the measures under existing au7 thorities of appropriate Federal agencies, as deter8 mined by the President. 

9 (d) PROJECTIONS.—The projections for total demand 

10 for petroleum in the United States under subsection (b) 

11 shall be based on the projections made in the Reference 

12 Case in the report of the Energy Information Administra13 tion entitled ‘‘Annual Energy Outlook 2006’’. 

14 (e) REPORT.— 

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

16 the date of enactment of this Act, and annually 

17 thereafter, the President shall submit to Congress a 

18 report, based on the most recent edition of the An19 nual Energy Outlook published by the Energy Infor20 mation Administration, assessing the progress made 

21 by the United States toward the goal of reducing de22 pendence on imported petroleum sources by 2025 

23 described in subsection (a). 

24 (2) CONTENTS.—The report shall— 


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1 (A) identify the status of efforts to meet 

2 the goal described in subsection (a); 

3 (B) assess the effectiveness of any measure 

4 implemented under subsection (b) during the 

5 previous fiscal year in meeting the goal de6 scribed in subsection (a); and 

7 (C) describe plans to develop additional 

8 measures to meet the goal. 

9 Subtitle B—Biofuels Infrastructure 

10 SEC. 111. MODIFICATION OF ALTERNATIVE FUEL VEHICLE 

11 REFUELING PROPERTY CREDIT. 

12 (a) INCREASE IN CREDIT AMOUNT.—Section 30C of 

13 the Internal Revenue Code of 1986 (relating to alternative 

14 fuel vehicle refueling property credit) is amended— 

15 (1) by striking ‘‘30 percent’’ in subsection (a) 

16 and inserting ‘‘50 percent’’, and 

17 (2) by striking ‘‘$30,000’’ in subsection (b)(1) 

18 and inserting ‘‘$50,000’’. 

19 (b) CREDIT ALLOWED FOR ELECTRIC DRIVE TRANS20 PORTATION PROPERTY.—Paragraph (1) of section 30C(c) 

21 of the Internal Revenue Code of 1986 (relating to quali22 fied alternative fuel vehicle refueling property) is amended 

23 by striking ‘‘, but only with respect to any fuel’’ and in24 serting ‘‘, except that in the case of property described 

25 in paragraph (3)(A) thereof, only with respect to fuels’’. 


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1 (c) EXTENSION OF CREDIT.—Subsection (g) section 

2 30C of the Internal Revenue Code of 1986 (relating to 

3 termination) is amended to read as follows: 

4 ‘‘(g) TERMINATION OF AVAILABILITY OF CREDIT.— 

5 This section shall not apply to property placed in service 

6 after the earlier of December 31, 2014, or the date after 

7 which more than 20,000 alternative refueling properties 

8 have been installed through use of this credit.’’. 

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

10 this section shall apply to property placed in service after 

11 the date of the enactment of this Act, in taxable years 

12 ending after such date. 

13 SEC. 112. ALTERNATIVE FUEL-RELATED STANDARDS. 

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

15 term ‘‘Secretary’’ means the Secretary of Energy, act16 ing— 

17 (1) in consultation with— 

18 (A) the Administrator of the Environ19 mental Protection Agency; 

20 (B) the Administrator of the National 

21 Highway Traffic Safety Administration; 

22 (C) the Commissioner of the Federal En23 ergy Regulatory Commission; 

24 (D) the head of the National Association 

25 of Regulatory Utility Commissioners; 


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1 (E) the States; 

2 (F) vehicle manufacturers; 

3 (G) vehicle fuel providers; and 

4 (H) appropriate safety organizations; and 

5 (2) in cooperation with applicable voluntary 

6 standard-setting organizations. 

7 (b) RECOMMENDATIONS AND GUIDANCE.—Not later 

8 than 1 year after the date of enactment of this Act, after 

9 providing notice and an opportunity for public comment, 

10 the Secretary shall publish recommendations and guidance 

11 relating to uniform national voluntary standards for— 

12 (1) alternative fuels; 

13 (2) alternative fuel vehicles; 

14 (3) equipment and systems relating to alter15 native fuels and alternative fuel vehicles; and 

16 (4) the safety, handling, refueling, and general 

17 use of the items described in paragraphs (1) through 

18 (3). 

19 (c) REVIEW.—Not less frequently than once every 2 

20 years, the Secretary shall— 

21 (1) review the recommendations and guidance 

22 published under subsection (b); and 

23 (2) modify the recommendations and guidance 

24 to reflect applicable changes during the preceding 2 


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1 years relating to fuel systems and related tech2 nologies. 

3 SEC. 113. ACCELERATING CONVERSION TO ALTERNATIVE 

4 FUELS INFRASTRUCTURE. 

5 (a) FINDINGS.—Congress finds that— 

6 (1) as of the date of enactment of this Act, an 

7 estimated 5,000,000 to 6,000,000 flexible-fuel vehi8 cles are on roads in the United States; 

9 (2) based on the report of the Department of 

10 Energy entitled ‘‘Transportation Energy Date Book: 

11 Edition 25,’’ only 740 refueling sites providing E– 

12 85 or biodiesel existed in the United States in 2005, 

13 equivalent to less than 1 percent of total United 

14 States refueling stations; and 

15 (3) as the number of flexible-fuel vehicles on 

16 roads in the United States increases, an increase in 

17 the availability of alternative refueling infrastructure 

18 must occur in order to enable the displacement of 

19 petroleum consumption. 

20 (b) GOAL.—Congress declares that it is the goal of 

21 the United States to increase the accessibility of alter22 native fuels to retail consumers, and to ensure that at 

23 least 10 percent of motor vehicle refueling stations provide 

24 alternative fuels, by calendar year 2015. 


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1 (c) ALTERNATIVE FUEL INFRASTRUCTURE INITIA2 TIVE.— 

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

4 the date of enactment of this Act, and every 2 years 

5 thereafter, the Secretary of Energy, in coordination 

6 with the Secretary of Transportation and the Ad7 ministrator of the Environmental Protection Agency, 

8 and in consultation with State and local govern9 ments, shall— 

10 (A) subject to subparagraph (B), develop 

11 and implement measures to increase the acces12 sibility of alternative fuels to retail consumers 

13 to a level sufficient to ensure that at least 10 

14 percent of motor vehicle refueling stations pro15 vide alternative fuels by calendar year 2015; 

16 and 

17 (B) if the Secretary of Energy determines 

18 that there are insufficient legal authorities to 

19 achieve the target for calendar year 2015 de20 scribed in subparagraph (A)— 

21 (i) develop and implement measures 

22 to increase the accessibility of alternative 

23 fuels to retail consumers, to the maximum 

24 extent practicable; and 


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1 (ii) submit to Congress by January 1, 

2 2008, proposed legislation or other rec3 ommendations to achieve that target. 

4 (2) REQUIREMENT FOR MAJOR INTEGRATED

5 OIL COMPANIES.— 

6 (A) IN GENERAL.—Each major integrated 

7 oil company shall install and make available to 

8 retail consumers alternative fuels refueling in9 frastructure at— 

10 (i) not less than 50 percent of the 

11 motor vehicle fueling stations owned by the 

12 company by not later than December 31, 

13 2010; and 

14 (ii) 100 percent of the motor vehicle 

15 refueling stations owned by the company 

16 by not later than January 1, 2015. 

17 (B) MEANS OF COMPLIANCE.—A major in18 tegrated oil company shall meet the require19 ments of subparagraph (A) by— 

20 (i) installing alternative refueling in21 frastructure at motor vehicle fueling sta22 tions; 

23 (ii) purchasing alternative refueling 

24 infrastructure credits issued under sub25 paragraph (C); or 


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1 (iii) carrying out a combination of the 

2 actions described in clauses (i) and (ii). 

3 (C) ALTERNATIVE REFUELING INFRA4 STRUCTURE CREDIT TRADING PROGRAM.—Not 

5 later than 180 days after the date of enactment 

6 of this Act, the Secretary shall establish a cred7 it trading program— 

8 (i) to permit a major integrated oil 

9 company that does not install alternative 

10 refueling infrastructure to comply with 

11 subparagraphs (A) and (B) to achieve that 

12 compliance by purchasing sufficient alter13 native refueling infrastructure credits; and 

14 (ii) under which the Secretary shall 

15 issue alternative refueling infrastructure 

16 credits to entities that install new alter17 native refueling infrastructure. 

18 (D) INTERFERENCE WITH INSTALLATION

19 OF ALTERNATIVE REFUELING EQUIPMENT OR

20 SALE OF ALTERNATIVE FUEL.— 

21 (i) IN GENERAL.—It shall be an un22 fair or deceptive act or practice in violation 

23 of section 5 of the Federal Trade Commis24 sion Act (15 U.S.C. 45) for any person to 

25 restrain trade in alternative fuels by interVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00019 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 fering with the installation of alternative 

2 refueling equipment, or the sale of alter3 native fuels, at any motor vehicle refueling 

4 station in the United States. 

5 (ii) ENFORCEMENT.—The Federal 

6 Trade Commission shall promulgate rules 

7 to enforce this subparagraph. 

8 (d) ENFORCEMENT.— 

9 (1) CIVIL PENALTIES.—Any major integrated 

10 oil company that fails to meet the alternative refuel11 ing infrastructure requirements of subsection (c) 

12 shall be subject to a civil penalty. 

13 (2) AMOUNT AND FREQUENCY OF PENALTY.— 

14 A civil penalty assessed under paragraph (1) shall 

15 be— 

16 (A) in an amount equivalent to $1,000,000 

17 for each motor vehicle refueling station owned 

18 by the major integrated oil company that fails 

19 to comply with subsection (c); and 

20 (B) assessed for each year during which 

21 the failure to comply occurs. 

22 (3) MITIGATION OR WAIVER.—The Secretary 

23 may mitigate or waive a civil penalty under this sub24 section, after public notice and comment, if the 

25 major integrated oil company— 


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1 (A) was unable to comply with subsection 

2 (c) for reasons the Secretary determines to be 

3 outside of the reasonable control of the major 

4 integrated oil company; or 

5 (B) demonstrates to the satisfaction of the 

6 Secretary that insufficient alternative fueled ve7 hicles exist within the geographic region of a 

8 motor refueling station to warrant the installa9 tion of the infrastructure. 

10 (4) PROCEDURE FOR ASSESSING PENALTY.— 

11 The Secretary shall assess a civil penalty under this 

12 subsection in accordance with the procedures pre13 scribed by section 333(d) of the Energy Policy and 

14 Conservation Act (42 U.S.C. 6303(d)). 

15 (e) INFRASTRUCTURE PILOT PROGRAM FOR ALTER16 NATIVE FUELS.— 

17 (1) IN GENERAL.—The Secretary of Energy, in 

18 consultation with the Secretary of Transportation 

19 and the Administrator of the Environmental Protec20 tion Agency (referred to in this subsection as the 

21 ‘‘Secretary’’), shall establish a competitive grant 

22 pilot program (referred to in this subsection as the 

23 ‘‘pilot program’’), to be administered through the 

24 Clean Cities Program of the Department of Energy, 

25 to provide not more than 10 geographically-dispersed 


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1 project grants to State governments, local govern2 ments, metropolitan transportation authorities, or 

3 partnerships of those entities to carry out 1 or more 

4 projects for the purposes described in paragraph (2). 

5 (2) GRANT PURPOSES.—A grant under this 

6 subsection shall be used for the establishment of re7 fueling infrastructure corridors for alternative fuels 

8 along the National Highway System, including— 

9 (A) installation of infrastructure and 

10 equipment necessary to ensure adequate dis11 tribution of qualified alternative fuels within the 

12 corridor; 

13 (B) installation of infrastructure and 

14 equipment necessary to directly support vehicles 

15 powered by qualified alternative fuels; and 

16 (C) operation and maintenance of infra17 structure and equipment installed as part of a 

18 project funded by the grant. 

19 (3) APPLICATIONS.— 

20 (A) REQUIREMENTS.— 

21 (i) IN GENERAL.—Subject to clause 

22 (ii), not later than 90 days after the date 

23 of enactment of this Act, the Secretary 

24 shall issue requirements for use in apply25 ing for grants under the pilot program. 


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1 (ii) MINIMUM REQUIREMENTS.—At a 

2 minimum, the Secretary shall require that 

3 an application for a grant under this sub4 section— 

5 (I) be submitted by— 

6 (aa) the head of a State or 

7 local government or a metropoli8 tan transportation authority, or 

9 any combination of those entities; 

10 and 

11 (bb) a registered participant 

12 in the Clean Cities Program of 

13 the Department of Energy; and 

14 (II) include— 

15 (aa) a description of the 

16 project proposed in the applica17 tion, including the ways in which 

18 the project meets the require19 ments of this subsection; 

20 (bb) an estimate of the de21 gree of use of the project, includ22 ing the estimated size of fleet of 

23 alternative fueled vehicles avail24 able within the geographic region 

25 of the corridor; 


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1 (cc) an estimate of the po2 tential petroleum displaced and 

3 air pollution emissions reduced as 

4 a result of the project, and a 

5 plan to collect and disseminate 

6 petroleum displacement and envi7 ronmental data relating to the 

8 project to be funded under the 

9 grant, over the expected life of 

10 the project; 

11 (dd) a description of the 

12 means by which the project will 

13 be sustainable without Federal 

14 assistance after the completion of 

15 the term of the grant; 

16 (ee) a complete description 

17 of the costs of the project, includ18 ing acquisition, construction, op19 eration, and maintenance costs 

20 over the expected life of the 

21 project; 

22 (ff) a description of which 

23 costs of the project will be sup24 ported by Federal assistance 

25 under this subsection; and 


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1 (gg) documentation to the 

2 satisfaction of the Secretary that 

3 diesel fuel containing sulfur at 

4 not more than 15 parts per mil5 lion is available for carrying out 

6 the project, and a commitment 

7 by the applicant to use that fuel 

8 in carrying out the project. 

9 (B) PARTNERS.—An applicant under sub10 paragraph (A) may carry out a project under 

11 the pilot program in partnership with public 

12 and private entities. 

13 (4) SELECTION CRITERIA.—In evaluating appli14 cations under the pilot program, the Secretary 

15 shall— 

16 (A) consider the experience of each appli17 cant with previous, similar projects; and 

18 (B) give priority consideration to applica19 tions that— 

20 (i) are most likely to maximize dis21 placement of petroleum consumption and 

22 environmental protection; 

23 (ii) demonstrate the greatest commit24 ment on the part of the applicant to ensure 

25 funding for the proposed project and the 


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1 greatest likelihood that the project will be 

2 maintained or expanded after Federal as3 sistance under this subsection is com4 pleted; 

5 (iii) represent a partnership of public 

6 and private entities; and 

7 (iv) exceed the minimum requirements 

8 of paragraph (3)(A)(ii). 

9 (5) PILOT PROJECT REQUIREMENTS.— 

10 (A) MAXIMUM AMOUNT.—The Secretary 

11 shall provide not more than $20,000,000 in 

12 Federal assistance under the pilot program to 

13 any applicant. 

14 (B) COST SHARING.—The non-Federal 

15 share of the cost of any activity relating to 

16 qualified alternative fuel infrastructure develop17 ment carried out using funds from a grant 

18 under this subsection shall be not less than 20 

19 percent. 

20 (C) MAXIMUM PERIOD OF GRANTS.—The 

21 Secretary shall not provide funds to any appli22 cant under the pilot program for more than 2 

23 years. 

24 (D) DEPLOYMENT AND DISTRIBUTION.— 

25 The Secretary shall seek, to the maximum exVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00026 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 tent practicable, to ensure a broad geographic 

2 distribution of project sites funded by grants 

3 under this subsection. 

4 (E) TRANSFER OF INFORMATION AND

5 KNOWLEDGE.—The Secretary shall establish 

6 mechanisms to ensure that the information and 

7 knowledge gained by participants in the pilot 

8 program are transferred among the pilot pro9 gram participants and to other interested par10 ties, including other applicants that submitted 

11 applications. 

12 (6) SCHEDULE.— 

13 (A) INITIAL GRANTS.— 

14 (i) IN GENERAL.—Not later than 90 

15 days after the date of enactment of this 

16 Act, the Secretary shall publish in the Fed17 eral Register, Commerce Business Daily, 

18 and such other publications as the Sec19 retary considers to be appropriate, a notice 

20 and request for applications to carry out 

21 projects under the pilot program. 

22 (ii) DEADLINE.—An application de23 scribed in clause (i) shall be submitted to 

24 the Secretary by not later than 180 days 


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1 after the date of publication of the notice 

2 under that clause. 

3 (iii) INITIAL SELECTION.—Not later 

4 than 90 days after the date by which appli5 cations for grants are due under clause 

6 (ii), the Secretary shall select by competi7 tive, peer-reviewed proposal up to 5 appli8 cations for projects to be awarded a grant 

9 under the pilot program. 

10 (B) ADDITIONAL GRANTS.— 

11 (i) IN GENERAL.—Not later than 2 

12 years after the date of enactment of this 

13 Act, the Secretary shall publish in the Fed14 eral Register, Commerce Business Daily, 

15 and such other publications as the Sec16 retary considers to be appropriate, a notice 

17 and request for additional applications to 

18 carry out projects under the pilot program 

19 that incorporate the information and 

20 knowledge obtained through the implemen21 tation of the first round of projects author22 ized under the pilot program. 

23 (ii) DEADLINE.—An application de24 scribed in clause (i) shall be submitted to 

25 the Secretary by not later than 180 days 


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1 after the date of publication of the notice 

2 under that clause. 

3 (iii) INITIAL SELECTION.—Not later 

4 than 90 days after the date by which appli5 cations for grants are due under clause 

6 (ii), the Secretary shall select by competi7 tive, peer-reviewed proposal such additional 

8 applications for projects to be awarded a 

9 grant under the pilot program as the Sec10 retary determines to be appropriate. 

11 (7) REPORTS TO CONGRESS.— 

12 (A) INITIAL REPORT.—Not later than 60 

13 days after the date on which grants are award14 ed under this subsection, the Secretary shall 

15 submit to Congress a report containing— 

16 (i) an identification of the grant re17 cipients and a description of the projects to 

18 be funded under the pilot program; 

19 (ii) an identification of other appli20 cants that submitted applications for the 

21 pilot program but to which funding was 

22 not provided; and 

23 (iii) a description of the mechanisms 

24 used by the Secretary to ensure that the 

25 information and knowledge gained by parVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00029 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 ticipants in the pilot program are trans2 ferred among the pilot program partici3 pants and to other interested parties, in4 cluding other applicants that submitted ap5 plications. 

6 (B) EVALUATION.—Not later than 2 years 

7 after the date of enactment of this Act, and an8 nually thereafter until the termination of the 

9 pilot program, the Secretary shall submit to 

10 Congress a report containing an evaluation of 

11 the effectiveness of the pilot program, including 

12 an assessment of the petroleum displacement 

13 and benefits to the environment derived from 

14 the projects included in the pilot program. 

15 (8) AUTHORIZATION OF APPROPRIATIONS.— 

16 There is authorized to be appropriated to the Sec17 retary to carry out this subsection $200,000,000, to 

18 remain available until expended. 

19 SEC. 114. LOW- INTEREST LOAN PROGRAM FOR FARMER20 OWNED RETAIL DELIVERY OF ALTERNATIVE 

21 FUELS. 

22 (a) PURPOSES OF LOANS.—Section 312(a) of the 

23 Consolidated Farm and Rural Development Act (7 U.S.C. 

24 1942(a)) is amended— 


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1 (1) in paragraph (9)(B)(ii), by striking ‘‘or’’ at 

2 the end; 

3 (2) in paragraph (10), by striking the period at 

4 the end and inserting ‘‘; or’’; and 

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

6 ‘‘(11) building infrastructure, including pump 

7 stations, for the retail delivery to consumers of any 

8 alternative fuel.’’. 

9 (b) PROGRAM.—Subtitle B of the Consolidated Farm 

10 and Rural Development Act (7 U.S.C. 1941 et seq.) is 

11 amended by adding at the end the following: 

12 ‘‘SEC. 320. LOW-INTEREST LOAN PROGRAM FOR FARMER13 OWNED RETAIL DELIVERY OF ALTERNATIVE 

14 FUELS. 

15 ‘‘(a) IN GENERAL.—The Secretary shall establish a 

16 low-interest loan program to assist farmer-owned alter17 native fuel producers (including cooperatives and limited 

18 liability corporations) to develop and build infrastructure, 

19 including pump stations, for the retail delivery to con20 sumers of any alternative fuel. 

21 ‘‘(b) TERMS.— 

22 ‘‘(1) INTEREST RATE.—A low-interest loan 

23 under this section shall have a fixed interest rate of 

24 no more than 5 percent for each year. 


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1 ‘‘(2) AMORTIZATION.—The repayment of a loan 

2 under this section shall be amortized over the ex3 pected life of the infrastructure project that is being 

4 financed with the proceeds of the loan. 

5 ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There 

6 are authorized to be appropriated such sums as are nec7 essary to carry out this section. 

8 ‘‘(d) REGULATIONS.—As soon as practicable after the 

9 date of enactment of this Act, the Secretary of Agriculture 

10 shall promulgate such regulations as are necessary to 

11 carry out the amendments made by this section.’’. 

12 SEC. 115. EXTENSION OF BIODIESEL INCOME AND EXCISE 

13 TAX CREDITS. 

14 (a) IN GENERAL.—Sections 40A(g), 6426(c)(6), and 

15 6427(e)(5)(B) of the Internal Revenue Code of 1986 are 

16 each amended by striking ‘‘2008’’ and inserting ‘‘2014’’. 

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

18 this section shall take effect on January 1, 2009. 

19 SEC. 116. SMALL ETHANOL PRODUCER CREDIT EXPANDED 

20 FOR PRODUCERS OF SUCROSE AND CEL21 LULOSIC ETHANOL. 

22 (a) IN GENERAL.—Subparagraph (C) of section 

23 40(b)(4) of the Internal Revenue Code of 1986 (relating 

24 to small ethanol producer credit) is amended by inserting 


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1 ‘‘(30,000,000 gallons for any sucrose or cellulosic ethanol 

2 producer)’’ after ‘‘15,000,000 gallons’’. 

3 (b) SUCROSE OR CELLULOSIC ETHANOL PRO4 DUCER.—Section 40(b)(4) of the Internal Revenue Code 

5 of 1986 is 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 (1) Section 40(g)(2) of the Internal Revenue 

23 Code of 1986 is amended by striking ‘‘15,000,000 

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

25 30,000,000 gallon limitations’’. 


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1 (2) Section 40(g)(5)(B) of such Code is amend2 ed by striking ‘‘15,000,000 gallons’’ and inserting 

3 ‘‘the gallon limitation under subsection (b)(4)(C)’’. 

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

5 this section shall apply to taxable years beginning after 

6 the date of the enactment of this Act. 

7 SEC. 117. INCENTIVES TO PRODUCE TRANSPORTATION 

8 FUELS FROM CELLULOSIC BIOMASS. 

9 (a) FUEL FROM CELLULOSIC BIOMASS.— 

10 (1) IN GENERAL.—The Secretary of Energy 

11 (referred to in this section as the ‘‘Secretary’’) shall 

12 provide deployment incentives under this subsection 

13 to encourage a variety of projects to produce trans14 portation fuel from cellulosic biomass, relying on dif15 ferent feedstocks in different regions of the United 

16 States. 

17 (2) PROJECT ELIGIBILITY.—Incentives under 

18 this subsection shall be provided on a competitive 

19 basis to projects that produce fuel and that— 

20 (A) meet United States fuel and emission 

21 specifications; 

22 (B) help diversify domestic transportation 

23 energy supplies; and 

24 (C) improve or maintain air, water, soil, 

25 and habitat quality. 


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1 (3) INCENTIVES.—Incentives under this sub2 section may consist of— 

3 (A) loan guarantees under section 1510 of 

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

5 16501), subject to section 1702 of that Act (22 

6 U.S.C. 16512), for the construction of produc7 tion facilities and supporting infrastructure; or 

8 (B) production payments through a reverse 

9 auction in accordance with paragraph (4). 

10 (4) REVERSE AUCTION.— 

11 (A) IN GENERAL.—In providing incentives 

12 under this subsection, the Secretary shall— 

13 (i) issue regulations under which pro14 ducers of fuel from cellulosic biomass may 

15 bid for production payments under para16 graph (3)(B); and 

17 (ii) solicit bids from producers of dif18 ferent classes of transportation fuel, as the 

19 Secretary determines to be appropriate. 

20 (B) REQUIREMENT.—The rules under sub21 paragraph (A) shall require that incentives be 

22 provided to the producers that submit the low23 est bid (in terms of cents per gallon) for each 

24 class of transportation fuel from which the Sec25 retary solicits a bid. 


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1 (b) PRODUCTION INCENTIVES FOR CELLULOSIC

2 BIOFUELS.—Section 942(f) of the Energy Policy Act of 

3 2005 (42 U.S.C. 16251(f)) is amended by striking 

4 ‘‘$250,000,000’’ and inserting ‘‘$200,000,000 for each of 

5 fiscal years 2007 through 2011’’. 

6 SEC. 118. ALTERNATIVE FUELS INVESTMENT BY MAJOR OIL 

7 COMPANIES AND VEHICLE MANUFACTURERS. 

8 (a) STUDY.— 

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

10 the date of the enactment of this Act and every 4 

11 years thereafter, the Comptroller General of the 

12 United States shall conduct a study of the extent to 

13 which entities described in paragraph (2) have in14 vested in alternative fuels production, infrastructure, 

15 and technology development to diversify the motor 

16 vehicle fuel and vehicle options available to con17 sumers in the United States. 

18 (2) DESCRIBED ENTITIES.—An entity described 

19 under this paragraph is— 

20 (A) a company that sells more than 

21 $500,000,000 of crude oil, gasoline, or petro22 leum distillates in the United States per year; 

23 and 

24 (B) a manufacturer. 


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1 (b) REPORT.—At the conclusion of each study de2 scribed in subsection (a), the Comptroller General shall 

3 submit a report to Congress that contains the results of 

4 such study. 

5 Subtitle C—Flexible Fuel Vehicle 

6 Market Penetration 

7 SEC. 121. CREDIT FOR PRODUCTION OF QUALIFIED FLEXI8 BLE FUEL VEHICLES. 

9 (a) IN GENERAL.—Subpart D of part IV of sub10 chapter A of chapter 1 of the Internal Revenue Code of 

11 1986 (relating to business related credits) is amended by 

12 adding at the end the following new section: 

13 ‘‘SEC. 45N. PRODUCTION OF QUALIFIED FLEXIBLE FUEL 

14 MOTOR VEHICLES. 

15 ‘‘(a) ALLOWANCE OF CREDIT.—For purposes of sec16 tion 38, in the case of a manufacturer, the qualified flexi17 ble fuel motor vehicle production credit determined under 

18 this section for any taxable year is an amount equal to 

19 the incremental flexible fuel motor vehicle cost for each 

20 qualified flexible fuel motor vehicle produced in the United 

21 States by the manufacturer during the taxable year. 

22 ‘‘(b) INCREMENTAL FLEXIBLE FUEL MOTOR VEHI23 CLE COST.—With respect to any qualified flexible fuel 

24 motor vehicle, the incremental flexible fuel motor vehicle 

25 cost is an amount equal to the lesser of— 


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1 ‘‘(1) the excess of— 

2 ‘‘(A) the cost of producing such qualified 

3 flexible fuel motor vehicle, over 

4 ‘‘(B) the cost of producing such motor ve5 hicle if such motor vehicle was not a qualified 

6 flexible fuel motor vehicle, or 

7 ‘‘(2) $150. 

8 ‘‘(c) QUALIFIED FLEXIBLE FUEL MOTOR VEHI9 CLE.—For purposes of this section, the term ‘qualified 

10 flexible fuel motor vehicle’ means a motor vehicle (as de11 fined under section 30(c)(2))— 

12 ‘‘(1) the production of which is not required for 

13 the manufacturer to meet— 

14 ‘‘(A) the maximum credit allowable for ve15 hicles described in paragraph (2) in determining 

16 the fleet average fuel economy requirements (as 

17 determined under section 32904 of title 49, 

18 United States Code) of the manufacturer for 

19 the model year ending in the taxable year, or 

20 ‘‘(B) the requirements of any other provi21 sion of Federal law, and 

22 ‘‘(2) which is designed so that the vehicle is 

23 propelled by an engine which can use as a fuel a pe24 troleum mixture of which 85 percent (or another 

25 percentage of not less than 70 percent, as the SecVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00038 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 retary may determine, by rule, to provide for re2 quirements relating to cold start, safety, or vehicle 

3 functions) of the volume of consists of ethanol or 

4 biodiesel. 

5 ‘‘(d) OTHER DEFINITIONS AND SPECIAL RULES.— 

6 For purposes of this section— 

7 ‘‘(1) MANUFACTURER.—The term ‘manufac8 turer’ has the meaning given such term in regula9 tions prescribed by the Administrator of the Envi10 ronmental Protection Agency for purposes of the ad11 ministration of title II of the Clean Air Act (42 

12 U.S.C. 7521 et seq.). 

13 ‘‘(2) REDUCTION IN BASIS.—For purposes of 

14 this subtitle, if a credit is allowed under this section 

15 for any expenditure with respect to any property, the 

16 increase in the basis of such property which would 

17 (but for this paragraph) result from such expendi18 ture shall be reduced by the amount of the credit so 

19 allowed. 

20 ‘‘(3) NO DOUBLE BENEFIT.—The amount of 

21 any deduction or credit allowable under this chapter 

22 (other than the credits allowable under this section 

23 and section 30B) shall be reduced by the amount of 

24 credit allowed under subsection (a) for such vehicle 

25 for the taxable year. 


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1 ‘‘(4) ELECTION NOT TO TAKE CREDIT.—No 

2 credit shall be allowed under subsection (a) for any 

3 vehicle if the taxpayer elects to not have this section 

4 apply to such vehicle. 

5 ‘‘(e) CROSS REFERENCE.—For an election to claim 

6 certain minimum tax credits in lieu of the credit deter7 mined under this section, see section 53(e).’’. 

8 (b) CREDIT ALLOWED AGAINST THE ALTERNATIVE

9 MINIMUM TAX.—Section 38(c)(4)(B) of the Internal Rev10 enue Code of 1986 (defining specified credits) is amended 

11 by striking the period at the end of clause (ii)(II) and in12 serting ‘‘, and’’, and by adding at the end the following 

13 new clause: 

14 ‘‘(iii) the credit determined under sec15 tion 45N.’’. 

16 (c) ELECTION TO USE ADDITIONAL AMT CREDIT.— 

17 Section 53 of the Internal Revenue Code of 1986 (relating 

18 to credit for prior year minimum tax liability) is amended 

19 by adding at the end the following new subsection: 

20 ‘‘(e) ADDITIONAL CREDIT IN LIEU OF FLEXIBLE

21 FUEL MOTOR VEHICLE CREDIT.— 

22 ‘‘(1) IN GENERAL.—In the case of a taxpayer 

23 making an election under this subsection for a tax24 able year, the limitation under subsection (c) for 

25 such taxable year shall be increased by the amount 


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1 of the credit determined under section 45N for such 

2 taxable year. 

3 ‘‘(2) ELECTION.—A taxpayer may make an 

4 election under this subsection for any taxable year 

5 only if the taxpayer elects not to take the credit 

6 under section 45N for such taxable year pursuant to 

7 section 45N(c)(4). Any election under this sub8 section may not be revoked except with the consent 

9 of the Secretary. 

10 ‘‘(3) CREDIT REFUNDABLE.—The aggregate in11 crease in the credit under this section for any tax12 able year by reason of this subsection shall for pur13 poses of this title (other than subsection (b)(2) of 

14 this section) be treated as a credit allowed to the 

15 taxpayer under subpart C.’’. 

16 (d) CONFORMING AMENDMENTS.— 

17 (1) Section 38(b) of the Internal Revenue Code 

18 of 1986 is amended by striking ‘‘and’’ at the end of 

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

20 paragraph (30) and inserting ‘‘, plus’’, and by add21 ing at the end the following new paragraph: 

22 ‘‘(31) the qualified flexible fuel motor vehicle 

23 production credit determined under section 

24 45N(a).’’. 


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

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

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

4 inserting ‘‘, and’’, and by adding at the end the fol5 lowing: 

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

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

8 extent provided in section 45N(d)(2).’’ 

9 (e) CLERICAL AMENDMENT.—The table of sections 

10 for subpart D of part IV of subchapter A of chapter 1 

11 of the Internal Revenue Code of 1986 is amended by add12 ing at the end the following new item: 

‘‘Sec. 45N. Production of qualified flexible fuel motor vehicles.’’. 

13 (f) EFFECTIVE DATE.—The amendments made by 

14 this section shall apply to motor vehicles produced in 

15 model years ending after the date of the enactment of this 

16 Act. 

17 SEC. 122. ENSURING AVAILABILITY OF FLEXIBLE FUEL VE18 HICLES. 

19 (a) AMENDMENT.— 

20 (1) IN GENERAL.—Chapter 329 of title 49, 

21 United States Code, is amended by inserting after 

22 section 32902 the following: 


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1 ‘‘§ 32902A. Requirement to manufacture flexible fuel 

2 vehicles 

3 ‘‘(a) IN GENERAL.—For each model year, each man4 ufacturer of new motor vehicles (as defined under section 

5 30(c)(2) of the Internal Revenue Code of 1986) described 

6 in subsection (b) shall ensure that the percentage of such 

7 vehicles manufactured in a particular model year that are 

8 flexible fuel vehicles shall be not less than the percentage 

9 set forth for that model year in the following table: 

‘‘If the model year is: 

The percentage of flexible fuel vehicles shall 

be: 

2010 ............................................................ 25 percent 

2020 ............................................................ 50 percent 

10 ‘‘(b) MOTOR VEHICLES DESCRIBED.—A motor vehi11 cle is described in this subsection if the vehicle— 

12 ‘‘(1) is capable of operating on gasoline or die13 sel fuel; 

14 ‘‘(2) is distributed in interstate commerce for 

15 sale in the United States; and 

16 ‘‘(3) does not contain certain engines that the 

17 Secretary of Transportation, in consultation with the 

18 Administrator of the Environmental Protection 

19 Agency and the Secretary of Energy, may tempo20 rarily exclude from the definition because it is tech21 nologically infeasible for the engines to have flexible 

22 fuel capability at any time during a period that the 


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1 Secretaries and the Administrator are engaged in an 

2 active research program with the vehicle manufac3 turers to develop that capability for the engines.’’. 

4 (2) DEFINITION OF FLEXIBLE FUEL VEHI5 CLE.—Section 32901(8) of title 49, United States 

6 Code, is amended by inserting ‘‘or ‘flexible fuel vehi7 cle’’’ after ‘‘‘dual fueled automobile’’’. 

8 (3) CLERICAL AMENDMENT.—The table of sec9 tions for chapter 329 of title 49, United States 

10 Code, is amended by inserting after the item relating 

11 to section 32902 the following: 

‘‘Sec. 32902A. Requirements to manufacture flexible fuel vehicles.’’. 

12 (b) RULEMAKING.— 

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

14 the date of the enactment of this Act, the Secretary 

15 of Transportation shall issue regulations to carry 

16 out the amendments made by subsection (a). 

17 (2) HARDSHIP EXEMPTION.—The regulations 

18 issued pursuant to paragraph (1) shall include a 

19 process by which a manufacturer may be exempted 

20 from the requirement under section 32902A(a) upon 

21 demonstrating that such requirement would create a 

22 substantial economic hardship for the manufacturer. 


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1 SEC. 123. INCREASING CONSUMER AWARENESS OF FLEXI2 BLE FUEL VEHICLES. 

3 Section 32908 of title 49, United States Code, is 

4 amended by adding at the end the following: 

5 ‘‘(g) INCREASING CONSUMER AWARENESS OF FLEXI6 BLE FUEL VEHICLES.—(1) The Secretary of Transpor7 tation shall prescribe regulations that require the manu8 facturer of vehicles distributed in interstate commerce for 

9 sale in the United States— 

10 ‘‘(A) to prominently display a permanent badge 

11 or emblem on the quarter panel or tailgate of each 

12 such vehicle that indicates such vehicle is capable of 

13 operating on alternative fuel; and 

14 ‘‘(B) to include information in the owner’s man15 ual of each such vehicle information that describes— 

16 ‘‘(i) the capability of the vehicle to operate 

17 using alternative fuel; and 

18 ‘‘(ii) the benefits of using alternative fuel, 

19 including the renewable nature, the increased 

20 fuel efficiency, and the environmental benefits 

21 of using alternative fuel. 

22 ‘‘(2) The Secretary of Transportation shall collabo23 rate with vehicle retailers to develop voluntary methods 

24 for providing prospective purchasers of vehicles with infor25 mation regarding the benefits of using alternative fuel in 

26 vehicles, including— 


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1 ‘‘(A) the renewable nature of alternative fuel; 

2 and 

3 ‘‘(B) the environmental benefits of using alter4 native fuel.’’. 

5 Subtitle D—25 by ’25 Renewable 

6 Energy and Fuels Vision 

7 SEC. 131. PRESIDENTIAL AUTHORITY TO INCREASE RENEW8 ABLE FUEL CONTENT OF MOTOR FUELS AND 

9 CLEAN ENERGY SOURCES. 

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

11 7545(o)(2)(B)) is amended by adding at the end the fol12 lowing: 

13 ‘‘(v) PRESIDENTIAL AUTHORITY.— 

14 ‘‘(I) IN GENERAL.—Beginning in 

15 calendar year 2009, notwithstanding 

16 clause (iv) and subject to clause (II), 

17 after full consideration of the reports 

18 required to be conducted and pub19 lished pursuant to subsections (b)(4) 

20 and (q), the review required under in 

21 subclauses (I) and (II) of clause (ii), 

22 the report required under section 

23 1352 of the Energy Policy Act of 

24 2005 (26 U.S.C. 41 note; 119 Stat. 

25 1058), and such other information as 


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1 is appropriate and relevant, the Presi2 dent may promulgate rules in accord3 ance with this subsection— 

4 ‘‘(aa) to gradually increase 

5 the proportion that— 

6 ‘‘(AA) the number of 

7 gallons of renewable fuel 

8 sold or introduced into com9 merce in calendar year 2013 

10 and subsequent calendar 

11 years; bears to 

12 ‘‘(BB) the total number 

13 of gallons of gasoline sold or 

14 introduced into commerce in 

15 each of those calendar years; 

16 and 

17 ‘‘(bb) to increase the min18 imum quantity of renewable fuel 

19 derived from cellulosic biomass 

20 above the 250,000,000-gallon 

21 level under clause (iii). 

22 ‘‘(II) LIMITATIONS.—The rules 

23 promulgated under subclause (I) shall 

24 not— 


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1 ‘‘(aa) except at the request 

2 of the Governor of a State, apply 

3 to fuel refiners, blenders, and im4 porters in a State in which more 

5 than 25 percent of the energy 

6 projected to be consumed in cal7 endar year 2025 is expected to or 

8 will be derived from 1 or more 

9 of— 

10 ‘‘(AA) renewable fuels; 

11 and 

12 ‘‘(BB) renewable elec13 tric energy generated at a 

14 facility (including a distrib15 uted generation facility) 

16 from solar or wind re17 sources, geothermal energy, 

18 ocean or wave energy, or 

19 biomass (as defined in sec20 tion 203(b) of the Energy 

21 Policy Act of 2005 (42 

22 U.S.C. 15852(b))) and re23 newable electric energy gen24 erated at a facility (includ25 ing a distributed generation 


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1 facility) from hydroelectric 

2 resources in existence before 

3 January 1, 2006; 

4 ‘‘(bb) be applied in a man5 ner that would require that the 

6 total amount of renewable fuels 

7 and renewable energy consumed 

8 in the United States exceed 25 

9 percent of the total amount of 

10 energy consumed in calendar 

11 year 2025; or 

12 ‘‘(cc) be applied in a manner 

13 that would harm the air quality 

14 of any State or significantly in15 crease the cost of motor vehicle 

16 fuel in a State or region.’’. 

17 Subtitle E—Nationwide Media 

18 Campaign to Encourage Energy 

19 Efficiency and Conservation 

20 SEC. 141. NATIONWIDE MEDIA CAMPAIGN TO ENCOURAGE 

21 ENERGY EFFICIENCY AND CONSERVATION. 

22 (a) IN GENERAL.—The Secretary of Energy, acting 

23 through the Assistant Secretary for Energy Efficiency and 

24 Renewable Energy (referred to in this section as the ‘‘Sec25 retary’’), shall develop and conduct a national media camVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00049 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 paign for the purpose of decreasing oil consumption in the 

2 United States over the next decade. 

3 (b) CONTRACT WITH ENTITY.—The Secretary shall 

4 carry out subsection (a) directly or through— 

5 (1) competitively bid contracts with 1 or more 

6 nationally recognized media firms for the develop7 ment and distribution of monthly television, radio, 

8 and newspaper public service announcements; or 

9 (2) collective agreements with 1 or more nation10 ally recognized institutes, businesses, or nonprofit 

11 organizations for the funding, development, and dis12 tribution of monthly television, radio, and newspaper 

13 public service announcements. 

14 (c) USE OF FUNDS.— 

15 (1) IN GENERAL.—Amounts made available to 

16 carry out this section shall be used for the following: 

17 (A) ADVERTISING COSTS.— 

18 (i) The purchase of media time and 

19 space. 

20 (ii) Creative and talent costs. 

21 (iii) Testing and evaluation of adver22 tising. 

23 (iv) Evaluation of the effectiveness of 

24 the media campaign. 


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1 (v) The negotiated fees for the win2 ning bidder on requests from proposals 

3 issued either by the Secretary for purposes 

4 otherwise authorized in this section. 

5 (vi) Entertainment industry outreach, 

6 interactive outreach, media projects and 

7 activities, public information, news media 

8 outreach, and corporate sponsorship and 

9 participation. 

10 (B) ADMINISTRATIVE COSTS.—Operational 

11 and management expenses. 

12 (2) LIMITATIONS.—In carrying out this section, 

13 the Secretary shall allocate not less than 85 percent 

14 of funds made available under subsection (e) for 

15 each fiscal year for the advertising functions speci16 fied under paragraph (1)(A). 

17 (d) REPORTS.—The Secretary shall annually submit 

18 to Congress a report that describes— 

19 (1) the strategy of the national media campaign 

20 and whether specific objectives of the campaign were 

21 accomplished, including— 

22 (A) determinations concerning the rate of 

23 change of oil consumption, in both absolute and 

24 per capita terms; and 


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1 (B) an evaluation that enables consider2 ation whether the media campaign contributed 

3 to reduction of oil consumption; 

4 (2) steps taken to ensure that the national 

5 media campaign operates in an effective and effi6 cient manner consistent with the overall strategy 

7 and focus of the campaign; 

8 (3) plans to purchase advertising time and 

9 space; 

10 (4) policies and practices implemented to ensure 

11 that Federal funds are used responsibly to purchase 

12 advertising time and space and eliminate the poten13 tial for waste, fraud, and abuse; and 

14 (5) all contracts or cooperative agreements en15 tered into with a corporation, partnership, or indi16 vidual working on behalf of the national media cam17 paign. 

18 (e) AUTHORIZATION OF APPROPRIATIONS.—There is 

19 authorized to be appropriated to carry out this section 

20 $5,000,000 for each of fiscal years 2006 through 2010. 

21 Subtitle F—Increasing Transit Use 

22 and Alternative Transportation 

23 Modes 

24 SEC. 151. TRANSIT-ORIENTED DEVELOPMENT CORRIDORS. 

25 (a) DEFINITIONS.—In this section: 


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1 (1) TRANSIT-ORIENTED DEVELOPMENT COR2 RIDOR.—The term ‘‘Transit-Oriented Development 

3 Corridor’’ or ‘‘TODC’’ means a geographic area des4 ignated by the Secretary under subsection (b). 

5 (2) OTHER TERMS.—The terms ‘‘fixed guide 

6 way’’, ‘‘local governmental authority’’, ‘‘mass trans7 portation’’, ‘‘Secretary’’, ‘‘State’’, and ‘‘urbanized 

8 area’’ have the meanings given the terms in section 

9 5302 of title 49, United States Code. 

10 (b) TRANSIT-ORIENTED DEVELOPMENT COR11 RIDORS.— 

12 (1) IN GENERAL.—The Secretary shall develop 

13 and carry out a program to designate geographic 

14 areas in urbanized areas as Transit-Oriented Devel15 opment Corridors. 

16 (2) CRITERIA.—An area designated as a TODC 

17 under paragraph (1) shall include rights-of-way for 

18 fixed guide way mass transportation facilities (in19 cluding commercial development of facilities that 

20 have a physical and functional connection with each 

21 facility). 

22 (3) NUMBER OF TODCS.—In consultation with 

23 State transportation departments and metropolitan 

24 planning organizations, the Secretary shall des25 ignate— 


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1 (A) not fewer than 10 TODCs by Decem2 ber 31, 2015; and 

3 (B) not fewer than 20 TODCs by Decem4 ber 31, 2025. 

5 (4) TRANSIT GRANTS.— 

6 (A) IN GENERAL.—The Secretary make 

7 grants to eligible states and local governmental 

8 authorities to pay the Federal share of the cost 

9 of designating geographic areas in urbanized 

10 areas as TODCs. 

11 (B) APPLICATION.—Each eligible State or 

12 local governmental authority that desires to re13 ceive a grant under this paragraph shall submit 

14 an application to the Secretary, at such time, in 

15 such manner, and accompanied by such addi16 tional information as the Secretary may reason17 ably require. 

18 (C) LABOR STANDARDS.—Subchapter IV 

19 of chapter 31 of title 40, United States Code 

20 shall apply to projects that receive funding 

21 under this section. 

22 (D) FEDERAL SHARE.—The Federal share 

23 of the cost of a project under this subsection 

24 shall be 50 percent. 


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1 (c) TODC RESEARCH AND DEVELOPMENT.—To sup2 port effective deployment of grants and incentives under 

3 this section, the Secretary shall establish a TODC re4 search and development program to conduct research on 

5 the best practices and performance criteria for TODCs. 

6 (d) AUTHORIZATION OF APPROPRIATIONS.—There is 

7 authorized to be appropriated to carry out this section 

8 $50,000,000 for each of fiscal years 2007 through 2012. 

9 SEC. 152. INCREASING TRANSIT UTILIZATION INCENTIVES. 

10 (a) IN GENERAL.—Section 132(f)(2)(A) of the Inter11 nal Revenue Code of 1986 (relating to limitation on exclu12 sion) is amended by striking ‘‘$100’’ and inserting 

13 ‘‘$200’’. 

14 (b) INFLATION ADJUSTMENT.—The second sentence 

15 of section 132(f)(6)(A) of the Internal Revenue Code of 

16 1986 (relating to inflation adjustment) is amended— 

17 (1) by striking ‘‘2002’’ and inserting ‘‘2006’’, 

18 and 

19 (2) by striking ‘‘2001’’ and inserting ‘‘2005’’. 

20 (c) EFFECTIVE DATE.—The amendments made by 

21 this section shall apply to taxable years beginning after 

22 December 31, 2005. 


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1 SEC. 153. EXTENSION OF TRANSPORTATION FRINGE BEN2 EFIT TO BICYCLE COMMUTERS. 

3 (a) IN GENERAL.—Paragraph (1) of section 132(f) 

4 of the Internal Revenue Code of 1986 (relating to general 

5 rule for qualified transportation fringe) is amended by 

6 adding at the end the following: 

7 ‘‘(D) Bicycle commuting allowance.’’. 

8 (b) BICYCLE COMMUTING ALLOWANCE DEFINED.— 

9 Paragraph (5) of section 132(f) of the Internal Revenue 

10 Code of 1986 (relating to definitions) is amended by add11 ing at the end the following: 

12 ‘‘(F) BICYCLE COMMUTING ALLOWANCE.— 

13 The term ‘bicycle commuting allowance’ means 

14 an amount provided to an employee for trans15 portation on a bicycle if such transportation is 

16 in connection with travel between the employ17 ee’s residence and place of employment.’’. 

18 (c) LIMITATION ON EXCLUSION.—Paragraph (2) of 

19 section 132(f) of the Internal Revenue Code of 1986 is 

20 amended by striking ‘‘subparagraphs (A) and (B)’’ and 

21 inserting ‘‘subparagraphs (A), (B), and (D)’’. 

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 II—ENSURING NEAR2 TERM ENERGY AFFORD3 ABILITY AND EMPOWERING 

4 AMERICAN FAMILIES 

5 Subtitle A—Making Gas Price 

6 Gouging a Federal Crime 

7 SEC. 201. UNFAIR OR DECEPTIVE ACTS OR PRACTICES IN 

8 COMMERCE RELATED TO GASOLINE AND PE9 TROLEUM DISTILLATES. 

10 (a) SALES TO CONSUMERS AT UNCONSCIONABLE

11 PRICE.— 

12 (1) IN GENERAL.—It is unlawful for any person 

13 to sell crude oil, gasoline, or petroleum distillates at 

14 a price that— 

15 (A) is unconscionably excessive; or 

16 (B) indicates the seller is taking unfair ad17 vantage of the circumstances to increase prices 

18 unreasonably. 

19 (2) FACTORS CONSIDERED.—In determining 

20 whether a violation of paragraph (1) has occurred, 

21 there shall be taken into account, among other fac22 tors, whether— 

23 (A) the amount charged represents a gross 

24 disparity between the price of the crude oil, gas25 oline, or petroleum distillate sold and the price 


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1 at which it was offered for sale in the usual 

2 course of the seller’s business immediately prior 

3 to the energy emergency; or 

4 (B) the amount charged grossly exceeds 

5 the price at which the same or similar crude oil, 

6 gasoline, or petroleum distillate was readily ob7 tainable by other purchasers. 

8 (3) MITIGATING FACTORS.—In determining 

9 whether a violation of paragraph (1) has occurred, 

10 there also shall be taken into account, among other 

11 factors, the price that would reasonably equate sup12 ply and demand in a competitive and freely func13 tioning market and whether the price at which the 

14 crude oil, gasoline, or petroleum distillate was sold 

15 reasonably reflects additional costs, not within the 

16 control of the seller, that were paid or incurred by 

17 the seller. 

18 (b) FALSE PRICING INFORMATION.—It is unlawful 

19 for any person to report information related to the whole20 sale price of crude oil, gasoline, or petroleum distillates 

21 to the Federal Trade Commission if— 

22 (1) that person knew, or reasonably should have 

23 known, the information to be false or misleading; 

24 (2) the information was required by law to be 

25 reported; and 


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1 (3) the person intended the false or misleading 

2 data to affect data compiled by that department or 

3 agency for statistical or analytical purposes with re4 spect to the market for crude oil, gasoline, or petro5 leum distillates. 

6 (c) MARKET MANIPULATION.—It is unlawful for any 

7 person, directly or indirectly, to use or employ, in connec8 tion with the purchase or sale of crude oil, gasoline, or 

9 petroleum distillates at wholesale, any manipulative or de10 ceptive device or contrivance, in contravention of such 

11 rules and regulations as the Commission may prescribe as 

12 necessary or appropriate in the public interest or for the 

13 protection of United States citizens. 

14 SEC. 202. ENFORCEMENT UNDER FEDERAL TRADE COMMIS15 SION ACT. 

16 (a) ENFORCEMENT BY COMMISSION.—This subtitle 

17 shall be enforced by the Federal Trade Commission. In 

18 enforcing section 201(a), the Commission shall give pri19 ority to enforcement actions concerning companies with 

20 total United States wholesale or retail sales of crude oil, 

21 gasoline, and petroleum distillates in excess of 

22 $500,000,000 per year but shall not exclude enforcement 

23 actions against companies with total United States whole24 sale sales of $500,000,000 or less per year. 


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1 (b) VIOLATION IS UNFAIR OR DECEPTIVE ACT OR

2 PRACTICE.—The violation of any provision of this Act 

3 shall be treated as an unfair or deceptive act or practice 

4 proscribed under a rule issued under section 18(a)(1)(B) 

5 of the Federal Trade Commission Act (15 U.S.C. 

6 57a(a)(1)(B)). 

7 SEC. 203. ENFORCEMENT AT RETAIL LEVEL BY STATE AT8 TORNEYS GENERAL. 

9 (a) IN GENERAL.—A State, as parens patriae, may 

10 bring a civil action on behalf of its residents in an appro11 priate district court of the United States to enforce the 

12 provisions of section 201(a), or to impose the civil pen13 alties authorized by section 204 for violations of section 

14 201(a), whenever the attorney general of the State has 

15 reason to believe that the interests of the residents of the 

16 State have been or are being threatened or adversely af17 fected by a person engaged in retail sales of gasoline or 

18 petroleum distillates to consumers for purposes other than 

19 resale that violates this subtitle or a regulation under this 

20 subtitle. 

21 (b) NOTICE.—The State shall serve written notice to 

22 the Commission of any civil action under subsection (a) 

23 prior to initiating such civil action. The notice shall in24 clude a copy of the complaint to be filed to initiate such 

25 civil action, except that if it is not feasible for the State 


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1 to provide such prior notice, the State shall provide such 

2 notice immediately upon instituting such civil action. 

3 (c) AUTHORITY TO INTERVENE.—Upon receiving the 

4 notice required by subsection (b), the Commission may in5 tervene in such civil action and upon intervening— 

6 (1) be heard on all matters arising in such civil 

7 action; and 

8 (2) file petitions for appeal of a decision in such 

9 civil action. 

10 (d) CONSTRUCTION.—For purposes of bringing any 

11 civil action under subsection (a), nothing in this section 

12 shall prevent the attorney general of a State from exer13 cising the powers conferred on the attorney general by the 

14 laws of such State to conduct investigations or to admin15 ister oaths or affirmations or to compel the attendance 

16 of witnesses or the production of documentary and other 

17 evidence. 

18 (e) VENUE; SERVICE OF PROCESS.—In a civil action 

19 brought under subsection (a)— 

20 (1) the venue shall be a judicial district in 

21 which— 

22 (A) the defendant operates; 

23 (B) the defendant was authorized to do 

24 business; or 


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1 (C) where the defendant in the civil action 

2 is found; 

3 (2) process may be served without regard to the 

4 territorial limits of the district or of the State in 

5 which the civil action is instituted; and 

6 (3) a person who participated with the defend7 ant in an alleged violation that is being litigated in 

8 the civil action may be joined in the civil action with9 out regard to the residence of the person. 

10 (f) LIMITATION ON STATE ACTION WHILE FEDERAL

11 ACTION IS PENDING.—If the Commission has instituted 

12 a civil action or an administrative action for violation of 

13 this subtitle, no State attorney general, or official or agen14 cy of a State, may bring an action under this section dur15 ing the pendency of that action against any defendant 

16 named in the complaint of the Commission or the other 

17 agency for any violation of this subtitle alleged in the com18 plaint. 

19 (g) ENFORCEMENT OF STATE LAW.—Nothing con20 tained in this section shall prohibit an authorized State 

21 official from proceeding in State court to enforce a civil 

22 or criminal statute of such State. 

23 SEC. 204. PENALTIES. 

24 (a) CIVIL PENALTY.— 


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1 (1) IN GENERAL.—In addition to any penalty 

2 applicable under the Federal Trade Commission 

3 Act— 

4 (A) any person who violates section 201(b) 

5 or 201(c) is punishable by a civil penalty of not 

6 more than $1,000,000; and 

7 (B) any person who violates section 201(a) 

8 is punishable by a civil penalty of not more 

9 than $3,000,000. 

10 (2) METHOD OF ASSESSMENT.—The penalties 

11 provided by paragraph (1) shall be assessed in the 

12 same manner as civil penalties imposed under sec13 tion 5 of the Federal Trade Commission Act (15 

14 U.S.C. 45). 

15 (3) MULTIPLE OFFENSES; MITIGATING FAC16 TORS.—In assessing the penalty provided by sub17 section (a)— 

18 (A) each day of a continuing violation shall 

19 be considered a separate violation; and 

20 (B) the Commission shall take into consid21 eration the seriousness of the violation and the 

22 efforts of the person committing the violation to 

23 remedy the harm caused by the violation in a 

24 timely manner. 


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1 (b) CRIMINAL PENALTY.—Violation of section 201(a) 

2 of this subtitle is punishable by a fine of not more than 

3 $1,000,000, imprisonment for not more than 5 years, or 

4 both. 

5 SEC. 205. EFFECT ON OTHER LAWS. 

6 (a) OTHER AUTHORITY OF COMMISSION.—Nothing 

7 in this subtitle shall be construed to limit or affect in any 

8 way the Commission’s authority to bring enforcement ac9 tions or take any other measure under the Federal Trade 

10 Commission Act (15 U.S.C. 41 et seq.) or any other provi11 sion of law. 

12 (b) STATE LAW.—Nothing in this subtitle preempts 

13 any State law. 

14 Subtitle B—Strengthening Anti15 Trust Enforcement in the Oil 

16 and Gas Industry 

17 SEC. 211. PROHIBITION ON UNILATERAL WITHHOLDING. 

18 The Clayton Act (15 U.S.C. 12 et seq.) is amended— 

19 (1) by redesignating section 28 as section 29; 

20 and 

21 (2) by inserting after section 27 the following: 

22 ‘‘SEC. 28. OIL AND NATURAL GAS. 

23 ‘‘(a) IN GENERAL.—Except as provided in subsection 

24 (b), it shall be unlawful for any person to refuse to sell, 

25 or to export or divert, existing supplies of petroleum, gasoVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00064 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 line, or other fuel derived from petroleum, or natural gas 

2 with the primary intention of increasing prices or creating 

3 a shortage in a geographic market. 

4 ‘‘(b) CONSIDERATIONS.—In determining whether a 

5 person who has refused to sell, or exported or diverted, 

6 existing supplies of petroleum, gasoline, or other fuel de7 rived from petroleum or natural gas or curtailed produc8 tion of such new supplies, has done so with the intent of 

9 increasing prices or creating a shortage in a geographic 

10 market under subsection (a), the court shall consider 

11 whether— 

12 ‘‘(1) the cost of acquiring, producing, refining, 

13 processing, marketing, selling, or otherwise making 

14 such products available has increased; and 

15 ‘‘(2) the price obtained from exporting or di16 verting existing supplies is greater than the price ob17 tained where the existing supplies are located or are 

18 intended to be shipped. 

19 ‘‘(c) SHIFT OF BURDEN OF PROOF.—If the Commis20 sion or the Attorney General makes a prima facie case 

21 of withholding supply against a refiner, distributor, or re22 tailer under this section— 

23 ‘‘(1) the burden of proof to show the with24 holding was not done to raise prices shall shift to 

25 the refiner, distributor, or retailer; and 


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1 ‘‘(2) a refiner, distributor, or retailer may rebut 

2 the prima facie case by showing that the action that 

3 is the basis of the alleged violation was taken in a 

4 good faith effort to respond to competition or for an5 other legitimate business reason.’’. 

6 SEC. 212. MODIFICATION OF MERGER STANDARD IN CLAY7 TON ACT. 

8 Under section 7 of the Clayton Act, a merger in the 

9 oil or gas industry shall only be allowed if it can be proven 

10 that the new entity would not appreciably diminish com11 petition. 

12 SEC. 213. STUDY BY THE GOVERNMENT ACCOUNTABILITY 

13 OFFICE. 

14 (a) DEFINITION.—In this section, the term ‘‘covered 

15 consent decree’’ means a consent decree— 

16 (1) to which either the Federal Trade Commis17 sion or the Department of Justice is a party; 

18 (2) that was entered by the district court not 

19 earlier than 10 years before the date of enactment 

20 of this Act; 

21 (3) that required divestitures; and 

22 (4) that involved a person engaged in the busi23 ness of exploring for, producing, refining, or other24 wise processing, storing, marketing, selling, or otherVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00066 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 wise making available petroleum, gasoline or other 

2 fuel derived from petroleum, or natural gas. 

3 (b) REQUIREMENT FOR A STUDY.—Not later than 

4 180 days after the date of enactment of this Act, the 

5 Comptroller General of the United States shall conduct 

6 a study evaluating the effectiveness of divestitures re7 quired under covered consent decrees. 

8 (c) REQUIREMENT FOR A REPORT.—Not later than 

9 180 days after the date of enactment of this Act, the 

10 Comptroller General shall submit a report to Congress, the 

11 Federal Trade Commission, and the Department of Jus12 tice regarding the findings of the study conducted under 

13 subsection (b). 

14 (d) FEDERAL AGENCY CONSIDERATION.—Upon re15 ceipt of the report required by subsection (c), the Attorney 

16 General or the Chairman of the Federal Trade Commis17 sion, as appropriate, shall consider whether any additional 

18 action is required to restore competition or prevent a sub19 stantial lessening of competition occurring as a result of 

20 any transaction that was the subject of the study con21 ducted under subsection (b). 

22 SEC. 214. JOINT FEDERAL AND STATE TASK FORCE. 

23 The Attorney General and the Chairman of the Fed24 eral Trade Commission shall establish a joint Federal25 State task force, which shall include the attorney general 


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1 of any State that chooses to participate, to investigate in2 formation sharing (including through the use of exchange 

3 agreements and commercial information services) among 

4 persons in the business of exploring for, producing, refin5 ing, or otherwise processing, storing, marketing, selling, 

6 or otherwise making available petroleum, gasoline or other 

7 fuel derived from petroleum, or natural gas (including any 

8 person about which the Energy Information Administra9 tion collects financial and operating data as part of its 

10 Financial Reporting System). 

11 Subtitle C—Improving Oversight of 

12 Oil and Gas Market Speculation 

13 SEC. 221. SHORT TITLE. 

14 This subtitle may be cited as the ‘‘Oil and Gas Trad15 ers Oversight Act of 2006’’. 

16 SEC. 222. REPORTING AND RECORDKEEPING FOR POSI17 TIONS INVOLVING ENERGY COMMODITIES. 

18 (a) IN GENERAL.—Section 2(h) of the Commodity 

19 Exchange Act (7 U.S.C. 2(h)) is amended by adding at 

20 the end the following: 

21 ‘‘(7) REPORTING AND RECORDKEEPING FOR

22 POSITIONS INVOLVING ENERGY COMMODITIES.— 

23 ‘‘(A) DEFINITIONS.—In this paragraph: 

24 ‘‘(i) DOMESTIC TERMINAL.—The term 

25 ‘domestic terminal’ means a technology, 


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1 software, or other means of providing elec2 tronic access within the United States to a 

3 contract, agreement, or transaction traded 

4 on a foreign board of trade. 

5 ‘‘(ii) ENERGY COMMODITY.—The term 

6 ‘energy commodity’ means a commodity or 

7 the derivatives of a commodity that is used 

8 primarily as a source of energy, includ9 ing— 

10 ‘‘(I) coal; 

11 ‘‘(II) crude oil; 

12 ‘‘(III) gasoline; 

13 ‘‘(IV) heating oil; 

14 ‘‘(V) diesel fuel; 

15 ‘‘(VI) electricity; 

16 ‘‘(VII) propane; and 

17 ‘‘(VIII) natural gas. 

18 ‘‘(iii) REPORTABLE CONTRACT.—The 

19 term ‘reportable contract’ means— 

20 ‘‘(I) a contract, agreement, or 

21 transaction involving an energy com22 modity , executed on an electronic 

23 trading facility, or 

24 ‘‘(II) a contract, agreement, or 

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1 ing an energy commodity for which 

2 the underlying energy commodity has 

3 a physical delivery point within the 

4 United States and that is executed 

5 through a domestic terminal. 

6 ‘‘(B) RECORD KEEPING.—The Commis7 sion, by rule, shall require any person holding, 

8 maintaining, or controlling any position in any 

9 reportable contract under this section— 

10 ‘‘(i) to maintain such records as di11 rected by the Commission for a period of 

12 5 years, or longer, if directed by the Com13 mission; and 

14 ‘‘(ii) to provide such records upon re15 quest to the Commission or the Depart16 ment of Justice. 

17 ‘‘(C) REPORTING OF POSITIONS INVOLVING

18 ENERGY COMMODITIES.—The Commission shall 

19 prescribe rules requiring such regular or contin20 uous reporting of positions in a reportable con21 tract in accordance with such requirements re22 garding size limits for reportable positions and 

23 the form, timing, and manner of filing such re24 ports under this paragraph, as the Commission 

25 shall determine. 


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1 ‘‘(D) OTHER RULES NOT AFFECTED.— 

2 ‘‘(i) IN GENERAL.—Except as pro3 vided in clause (ii), this paragraph does 

4 not prohibit or impair the adoption by any 

5 board of trade licensed, designated, or reg6 istered by the Commission of any bylaw, 

7 rule, regulation, or resolution requiring re8 ports of positions in any agreement, con9 tract, or transaction made in connection 

10 with a contract of sale for future delivery 

11 of an energy commodity (including such a 

12 contract of sale), including any bylaw, rule, 

13 regulation, or resolution pertaining to fil14 ing or recordkeeping, which may be held by 

15 any person subject to the rules of the 

16 board of trade. 

17 ‘‘(ii) EXCEPTION.—Any bylaw, rule, 

18 regulation, or resolution established by a 

19 board of trade described in clause (i) shall 

20 not be inconsistent with any requirement 

21 prescribed by the Commission under this 

22 paragraph. 

23 ‘‘(E) CONTRACT, AGREEMENT, OR TRANS24 ACTION FOR FUTURE DELIVERY.—Notwith25 standing sections 4(b) and 4a, the Commission 


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1 shall subject a contract, agreement, or trans2 action for future delivery in an energy com3 modity to the requirements established by this 

4 paragraph.’’. 

5 (b) CONFORMING AMENDMENTS.—Section 4a(e) of 

6 the Commodity Exchange Act (7 U.S.C. 6a(e)) is amend7 ed— 

8 (1) in the first sentence— 

9 (A) by inserting ‘‘or by an electronic trad10 ing facility operating in reliance on section 

11 2(h)(3)’’ after ‘‘registered by the Commission’’; 

12 and 

13 (B) by inserting ‘‘electronic trading facil14 ity,’’ before ‘‘or such board of trade’’; and 

15 (2) in the second sentence, by inserting ‘‘or by 

16 an electronic trading facility operating in reliance on 

17 section 2(h)(3)’’ after ‘‘registered by the Commis18 sion’’. 


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1 Subtitle D—Low Income Energy 

2 Price Relief 

3 SEC. 231. ADJUSTMENT OF STANDARD UTILITY ALLOW4 ANCE UNDER THE FOOD STAMP PROGRAM 

5 FOR HIGH ENERGY COSTS. 

6 Section 5(e)(6)(C) of the Food Stamp Act of 1977 

7 (7 U.S.C. 2014(e)(6)(C)) is amended by adding at the end 

8 the following: 

9 ‘‘(v) ENERGY COST INCREASES.—If 

10 the Energy Information Administration 

11 projects that energy costs for the average 

12 household in the United States will in13 crease by more than 20 percent during the 

14 winter heating months (November through 

15 April) of the fiscal year, the amount of a 

16 standard utility allowance used by a State 

17 for all or part of the fiscal year under this 

18 subparagraph may be adjusted to reflect 

19 the amount of the projected increase in en20 ergy costs.’’. 

21 SEC. 232. PUBLIC HOUSING ENERGY COST ASSISTANCE. 

22 (a) UTILITY ALLOWANCE.—Section 8(o)(1)(D) of the 

23 United States Housing Act of 1937 (42 U.S.C. 

24 1437f(o)(1)(D)) is amended— 


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1 (1) by striking ‘‘The Secretary’’ and inserting 

2 the following: 

3 ‘‘(i) IN GENERAL.—Except as pro4 vided under clause (ii), the Secretary’’; and 

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

6 ‘‘(ii) EXCEPTION FOR INCREASES IN

7 UTILITY ALLOWANCES.—The payment 

8 standard established under subparagraph 

9 (B) may exceed 110 percent of the fair 

10 market rental established under subsection 

11 (c) for the same size of dwelling unit in the 

12 same market area without prior approval 

13 by the Secretary, if a public housing agen14 cy determines that an increase in the util15 ity allowance of such agency, in combina16 tion with prevailing rents, requires such 

17 limit to be exceeded.’’. 

18 (b) ANNUAL ADJUSTMENT FACTOR.—Section 8(o) of 

19 the United States Housing Act of 1937 (42 U.S.C. 

20 1437f(o)) is amended by adding at the end the following: 

21 ‘‘(21) ANNUAL ADJUSTMENT FACTOR FOR

22 UTILITY COSTS.—Beginning on October 1, 2006, 

23 and each October 1 thereafter, the Secretary, in con24 sultation with the Secretary of Energy, shall, based 

25 on the most recent data available, adjust the utility 


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1 cost component of the annual adjustment factors 

2 used to calculate funding for public housing agencies 

3 under this section.’’. 

4 (c) REPORT.—Section 8(o)(1)(E) of the United 

5 States Housing Act of 1937 (42 U.S.C. 1437f(o)(1)(E)) 

6 is amended— 

7 (1) in clause (i), by striking ‘‘; and’’ and insert8 ing a semicolon; 

9 (2) in clause (ii), by striking the period and in10 serting a semicolon; and 

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

12 ‘‘(iii) shall submit a report, on an an13 nual basis, to the Committee on Banking, 

14 Housing, and Urban Affairs of the Senate 

15 and the Committee on Financial Services 

16 of the House of Representatives on the 

17 number and percentage of families— 

18 ‘‘(I) in each public housing agen19 cy receiving assistance under this sub20 section that pay more than 30 percent 

21 of their income for rent and utility 

22 costs; and 

23 ‘‘(II) in all public housing agen24 cies receiving assistance under this 

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1 cent of their income for rent and util2 ity costs; and 

3 ‘‘(iv) shall publish in the Federal Reg4 ister and make available on the Internet 

5 website maintained by the Department of 

6 Housing and Urban Development the re7 ports required under clause (iii).’’. 

8 SEC. 233. REFUNDABLE TAX CREDIT FOR LOW-INCOME RES9 IDENTIAL ENERGY COST ASSISTANCE. 

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

12 1986 (relating to refundable credits) is amended by redes13 ignating section 36 as section 37 and by inserting after 

14 section 35 the following new section: 

15 ‘‘SEC. 36. CREDIT FOR RESIDENTIAL ENERGY COST ASSIST16 ANCE. 

17 ‘‘(a) GENERAL RULE.—In the case of any individual, 

18 there shall be allowed as a credit against the tax imposed 

19 by this subtitle for the taxable year an amount equal to 

20 the lesser of— 

21 ‘‘(1) 20 percent of the qualified residential en22 ergy costs of the taxpayer during such taxable year, 

23 or 

24 ‘‘(2) $200 ($300 in the case of a joint return). 

25 ‘‘(b) INCOME LIMITATION.— 


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1 ‘‘(1) IN GENERAL.—The amount allowable as a 

2 credit under subsection (a) for any taxable year shall 

3 be reduced (but not below zero) by an amount which 

4 bears the same ratio to the amount so allowable (de5 termined without regard to this paragraph) as— 

6 ‘‘(A) the amount (if any) by which the tax7 payer’s adjusted gross income exceeds $35,000 

8 ($70,000 in the case of a joint return), bears to 

9 ‘‘(B) $10,000. 

10 ‘‘(2) DETERMINATION OF ADJUSTED GROSS IN11 COME.—For purposes of paragraph (1), adjusted 

12 gross income shall be determined without regard to 

13 sections 911, 931, and 933. 

14 ‘‘(c) DEFINITIONS AND SPECIAL RULES.—For pur15 poses of this section— 

16 ‘‘(1) QUALIFIED RESIDENTIAL ENERGY

17 COSTS.—The term ‘qualified residential energy costs’ 

18 means, with respect to any principal residence of the 

19 taxpayer located in the United States, the costs paid 

20 or incurred by the taxpayer for the period beginning 

21 after December 31, 2005, and ending before Janu22 ary 1, 2008, for any energy utility and home energy 

23 fuel. 

24 ‘‘(2) REDUCTION FOR GRANTS.—The amount of 

25 qualified residential energy costs which may be 


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1 taken into account with respect to such period shall 

2 be reduced by any amount received by the taxpayer 

3 during such period for any residential energy cost 

4 under the Low-Income Home Energy Assistance 

5 program under title XXVI of the Omnibus Budget 

6 Reconciliation Act of 1981 (42 U.S.C. 8621 et seq.). 

7 ‘‘(3) PRINCIPAL RESIDENCE.—The term ‘prin8 cipal residence’ has the same meaning as in section 

9 121, except that— 

10 ‘‘(A) no ownership requirement shall be 

11 imposed, and 

12 ‘‘(B) the principal residence must be used 

13 by the taxpayer as the taxpayer’s residence dur14 ing the taxable year. 

15 ‘‘(4) CERTAIN PERSONS NOT ELIGIBLE.—This 

16 section shall not apply to any individual with respect 

17 to whom a deduction under section 151 is allowable 

18 to another taxpayer for a taxable year beginning in 

19 the calendar year in which such individual’s taxable 

20 year begins. 

21 ‘‘(5) HOMEOWNERS ASSOCIATIONS.—The appli22 cation of this section to homeowners associations (as 

23 defined in section 528(c)(1)) or members of such as24 sociations, and tenant-stockholders in cooperative 

25 housing corporations (as defined in section 216), 


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1 shall be allowed by allocation, apportionment, or oth2 erwise, to the individuals paying, directly or indi3 rectly, for the qualified residential energy cost so in4 curred. 

5 ‘‘(d) REGULATIONS.—The Secretary may prescribe 

6 such regulations and other guidance as may be necessary 

7 or appropriate to carry out this section.’’. 

8 (b) CONFORMING AMENDMENTS.— 

9 (1) Section 1324(b)(2) of title 31, United 

10 States Code, is amended by striking ‘‘or’’ before 

11 ‘‘enacted’’ and by inserting before the period at the 

12 end ‘‘, or from section 36 of such Code’’. 

13 (2) The table of sections for subpart C of part 

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

16 relating to section 35 and by adding at the end the 

17 following new items: 

‘‘Sec. 36. Credit for residential energy cost assistance. 

‘‘Sec. 37. Overpayments of tax.’’. 

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

19 this section shall apply to taxable years beginning after 

20 December 31, 2005. 


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1 Subtitle E—Small Business and Ag2 ricultural Producers Energy 

3 Emergency Relief Program 

4 SEC. 241. ENERGY EMERGENCY DISASTER RELIEF LOANS 

5 TO SMALL BUSINESS AND AGRICULTURAL 

6 PRODUCERS. 

7 (a) DEFINITIONS.—In this section— 

8 (1) the terms ‘‘Administration’’ and ‘‘Adminis9 trator’’ mean the Small Business Administration 

10 and the Administrator thereof, respectively; 

11 (2) the term ‘‘Secretary’’ means the Secretary 

12 of Agriculture; and 

13 (3) the term ‘‘small business concern’’ has the 

14 same meaning as in section 3 of the Small Business 

15 Act (15 U.S.C. 632). 

16 (b) SMALL BUSINESS PRODUCER ENERGY EMER17 GENCY DISASTER LOAN PROGRAM.— 

18 (1) DISASTER LOAN AUTHORITY.—Section 7(b) 

19 of the Small Business Act (15 U.S.C. 636(b)) is 

20 amended by inserting immediately after paragraph 

21 (3) the following: 

22 ‘‘(4) ENERGY DISASTER LOANS.— 

23 ‘‘(A) DEFINITIONS.—For purposes of this 

24 paragraph— 


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1 ‘‘(i) the term ‘base price index’ means 

2 the moving average of the closing unit 

3 price on the New York Mercantile Ex4 change for heating oil, natural gas, gaso5 line, or propane for the 10 days that cor6 respond to the trading days described in 

7 clause (ii) in each of the most recent 2 pre8 ceding years; 

9 ‘‘(ii) the term ‘current price index’ 

10 means the moving average of the closing 

11 unit price on the New York Mercantile Ex12 change, for the 10 most recent trading 

13 days, for contracts to purchase heating oil, 

14 natural gas, gasoline, or propane during 

15 the subsequent calendar month, commonly 

16 known as the ‘front month’; and 

17 ‘‘(iii) the term ‘significant increase’ 

18 means— 

19 ‘‘(I) with respect to the price of 

20 heating oil, natural gas, gasoline, or 

21 propane, any time that the current 

22 price index exceeds the base price 

23 index by not less than 40 percent; and 

24 ‘‘(II) with respect to the price of 

25 kerosene, any increase which the AdVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00081 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 ministrator, in consultation with the 

2 Secretary of Energy, determines to be 

3 significant. 

4 ‘‘(B) LOAN AUTHORITY.— 

5 ‘‘(i) IN GENERAL.—The Administra6 tion may make such loans, either directly 

7 or in cooperation with banks or other lend8 ing institutions through agreements to par9 ticipate on an immediate or deferred basis, 

10 to assist a small business concern de11 scribed in clause (ii). 

12 ‘‘(ii) CRITERIA.—A small business 

13 concern described in this clause is a small 

14 business concern that has suffered or that 

15 is likely to suffer substantial economic in16 jury on or after January 1, 2005, as the 

17 result of a significant increase in the price 

18 of heating oil, natural gas, gasoline, pro19 pane, or kerosene occurring on or after 

20 January 1, 2005. 

21 ‘‘(C) INTEREST RATE.—Any loan or guar22 antee extended pursuant to this paragraph shall 

23 be made at the same interest rate as economic 

24 injury loans under paragraph (2). 


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1 ‘‘(D) MAXIMUM AMOUNT.—No loan may 

2 be made under this paragraph, either directly 

3 or in cooperation with banks or other lending 

4 institutions through agreements to participate 

5 on an immediate or deferred basis, if the total 

6 amount outstanding and committed to the bor7 rower under this subsection would exceed 

8 $1,500,000, unless such borrower constitutes a 

9 major source of employment in its surrounding 

10 area, as determined by the Administrator, in 

11 which case the Administrator, in the discretion 

12 of the Administrator, may waive the $1,500,000 

13 limitation. 

14 ‘‘(E) DISASTER DECLARATION.—For pur15 poses of assistance under this paragraph— 

16 ‘‘(i) a declaration of a disaster area 

17 based on conditions specified in this para18 graph shall be required, and shall be made 

19 by the President or the Administrator; or 

20 ‘‘(ii) if no declaration has been made 

21 pursuant to clause (i), the Governor of a 

22 State in which a significant increase in the 

23 price of heating oil, natural gas, gasoline, 

24 propane, or kerosene has occurred may 

25 certify to the Administration that small 


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1 business concerns have suffered economic 

2 injury as a result of such increase and are 

3 in need of financial assistance which is not 

4 otherwise available on reasonable terms in 

5 that State, and upon receipt of such cer6 tification, the Administration may make 

7 such loans as would have been available 

8 under this paragraph if a disaster declara9 tion had been issued. 

10 ‘‘(F) CONVERSION.—Notwithstanding any 

11 other provision of law, loans made under this 

12 paragraph may be used by a small business 

13 concern described in subparagraph (B) to con14 vert from the use of heating oil, natural gas, 

15 gasoline, propane, or kerosene to a renewable or 

16 alternative energy source, including agriculture 

17 and urban waste, geothermal energy, cogenera18 tion, solar energy, wind energy, or fuel cells.’’. 

19 (2) CONFORMING AMENDMENTS.—Section 3(k) 

20 of the Small Business Act (15 U.S.C. 632(k)) is 

21 amended— 

22 (A) by inserting ‘‘, significant increase in 

23 the price of heating oil, natural gas, gasoline, 

24 propane, or kerosene’’ after ‘‘civil disorders’’; 

25 and 


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1 (B) by inserting ‘‘other’’ before ‘‘eco2 nomic’’. 

3 (c) AGRICULTURAL PRODUCER EMERGENCY

4 LOANS.— 

5 (1) IN GENERAL.—Section 321(a) of the Con6 solidated Farm and Rural Development Act (7 

7 U.S.C. 1961(a)) is amended— 

8 (A) in the first sentence— 

9 (i) by striking ‘‘operations have’’ and 

10 inserting ‘‘operations (i) have’’; and 

11 (ii) by inserting before ‘‘: Provided,’’ 

12 the following: ‘‘, or (ii)(I) are owned or op13 erated by such an applicant that is also a 

14 small business concern (as defined in sec15 tion 3 of the Small Business Act (15 

16 U.S.C. 632)), and (II) have suffered or are 

17 likely to suffer substantial economic injury 

18 on or after August 24, 2005, as the result 

19 of a significant increase in energy costs or 

20 input costs from energy sources occurring 

21 on or after August 24, 2005, in connection 

22 with an energy emergency declared by the 

23 President or the Secretary’’; 

24 (B) in the third sentence, by inserting be25 fore the period at the end the following: ‘‘or by 


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1 an energy emergency declared by the President 

2 or the Secretary’’; and 

3 (C) in the fourth sentence— 

4 (i) by inserting ‘‘or energy emer5 gency’’ after ‘‘natural disaster’’ each place 

6 that term appears; and 

7 (ii) by inserting ‘‘or declaration’’ after 

8 ‘‘emergency designation’’. 

9 (2) FUNDING.—Funds available on the date of 

10 enactment of this Act for emergency loans under 

11 subtitle C of the Consolidated Farm and Rural De12 velopment Act (7 U.S.C. 1961 et seq.) shall be avail13 able to carry out the amendments made by para14 graph (1) to meet the needs resulting from natural 

15 disasters. 

16 (d) GUIDELINES AND RULEMAKING.— 

17 (1) GUIDELINES.—Not later than 30 days after 

18 the date of enactment of this Act, the Administrator 

19 and the Secretary shall each issue guidelines to 

20 carry out subsections (b) and (c), respectively, and 

21 the amendments made thereby, which guidelines 

22 shall become effective on the date of their issuance. 

23 (2) RULEMAKING.—Not later than 30 days 

24 after the date of enactment of this Act, the Adminis25 trator, after consultation with the Secretary of EnVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00086 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 ergy, shall promulgate regulations specifying the 

2 method for determining a significant increase in the 

3 price of kerosene under section 7(b)(4)(A)(iii)(II) of 

4 the Small Business Act, as added by this section. 

5 (e) REPORTS.— 

6 (1) SMALL BUSINESS ADMINISTRATION.—Not 

7 later than 12 months after the date on which the 

8 Administrator issues guidelines under subsection 

9 (d)(1), and annually thereafter, until the date that 

10 is 12 months after the end of the effective period of 

11 section 7(b)(4) of the Small Business Act, as added 

12 by this section, the Administrator shall submit to 

13 the Committee on Small Business and Entrepre14 neurship of the Senate and the Committee on Small 

15 Business of the House of Representatives, a report 

16 on the effectiveness of the assistance made available 

17 under section 7(b)(4) of the Small Business Act, as 

18 added by this section, including— 

19 (A) the number of small business concerns 

20 that applied for a loan under that section 

21 7(b)(4) and the number of those that received 

22 such loans; 

23 (B) the dollar value of those loans; 

24 (C) the States in which the small business 

25 concerns that received such loans are located; 


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1 (D) the type of energy that caused the sig2 nificant increase in the cost for the partici3 pating small business concerns; and 

4 (E) recommendations for ways to improve 

5 the assistance provided under that section 

6 7(b)(4), if any. 

7 (2) DEPARTMENT OF AGRICULTURE.—Not later 

8 than 12 months after the date on which the Sec9 retary issues guidelines under subsection (d)(1), and 

10 annually thereafter, until the date that is 12 months 

11 after the end of the effective period of the amend12 ments made to section 321(a) of the Consolidated 

13 Farm and Rural Development Act (7 U.S.C. 

14 1961(a)) by this section, the Secretary shall submit 

15 to the Committee on Small Business and Entrepre16 neurship and the Committee on Agriculture, Nutri17 tion, and Forestry of the Senate and to the Com18 mittee on Small Business and the Committee on Ag19 riculture of the House of Representatives, a report 

20 that— 

21 (A) describes the effectiveness of the as22 sistance made available under section 321(a) of 

23 the Consolidated Farm and Rural Development 

24 Act (7 U.S.C. 1961(a)), as amended by this 

25 section; and 


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1 (B) contains recommendations for ways to 

2 improve the assistance provided under such sec3 tion 321(a). 

4 (f) EFFECTIVE DATE.— 

5 (1) SMALL BUSINESS.—The amendments made 

6 by subsection (b) shall apply during the 4-year pe7 riod beginning on the earlier of the date on which 

8 guidelines are published by the Administrator under 

9 subsection (d)(1), or 30 days after the date of enact10 ment of this Act, with respect to assistance under 

11 section 7(b)(4) of the Small Business Act, as added 

12 by this section. 

13 (2) DEPARTMENT OF AGRICULTURE.—The 

14 amendments made by subsection (c) shall apply dur15 ing the 4-year period beginning on the earlier of the 

16 date on which guidelines are published by the Sec17 retary under subsection (d)(1), or 30 days after the 

18 date of enactment of this Act, with respect to assist19 ance under section 321(a) of the Consolidated Farm 

20 and Rural Development Act (7 U.S.C. 1961(a)), as 

21 amended by this section. 


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1 Subtitle F—Public Access to Fed2 eral Alternative Refueling Sta3 tions 

4 SEC. 251. ACCESS TO FEDERAL ALTERNATIVE REFUELING 

5 STATIONS. 

6 (a) DEFINITIONS.—In this section: 

7 (1) ALTERNATIVE FUEL REFUELING STA8 TION.—The term ‘‘alternative fuel refueling station’’ 

9 has the meaning given the term ‘‘qualified alter10 native fuel vehicle refueling property’’ in section 

11 30C(c)(1) of the Internal Revenue Code of 1986. 

12 (2) SECRETARY.—The term ‘‘Secretary’’ means 

13 the Secretary of Energy. 

14 (b) ACCESS.—Not later than 18 months after the 

15 date of enactment of this Act— 

16 (1) except as provided in subsection (d)(1), any 

17 Federal property that includes at least 1 fuel refuel18 ing station shall include at least 1 alternative fuel 

19 refueling station; and 

20 (2) except as provided in subsection (d)(2), any 

21 alternative fuel refueling station located on property 

22 owned by the Federal Government shall permit full 

23 public access for the purpose of refueling using al24 ternative fuel. 


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1 (c) DURATION.—The requirements described in sub2 section (b) shall remain in effect until the earlier of— 

3 (1) the date that is 7 years after the date of en4 actment of this Act; or 

5 (2) the date on which the Secretary determines 

6 that not less than 5 percent of the commercial re7 fueling infrastructure in the United States offers al8 ternative fuels to the general public. 

9 (d) EXCEPTIONS.— 

10 (1) WAIVER.—Subsection (b)(1) shall not apply 

11 to any Federal property under the jurisdiction of a 

12 Federal agency if the Secretary determines that al13 ternative fuel is not reasonably available to retail 

14 purchasers of the fuel, as certified by the head of 

15 the agency to the Secretary. 

16 (2) NATIONAL SECURITY EXEMPTION.—Sub17 section (b)(2) shall not apply to property of the Fed18 eral government that the Secretary, in consultation 

19 with the Secretary of Defense, has certified must be 

20 exempt for national security reasons. 

21 (3) SAFETY EXEMPTION.—Subsection (b)(2) 

22 shall not apply to property of the Federal govern23 ment that the Secretary determines poses a safety 

24 hazard to the general public. 


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1 (e) VERIFICATION OF COMPLIANCE.—The Secretary 

2 shall— 

3 (1) monitor compliance with this section by all 

4 Federal agencies; and 

5 (2) annually submit to Congress a report de6 scribing the extent of compliance with this section. 

7 Subtitle G—Measures to Empower 

8 Drivers to Realize Improved 

9 Fuel Economy 

10 SEC. 261. IMPROVED LABELING ON NEW VEHICLE WINDOW 

11 STICKERS. 

12 (a) IN GENERAL.—The Administrator of the Envi13 ronmental Protection Agency (referred to in this section 

14 as the ‘‘Administrator’’), in consultation with the Sec15 retary of Transportation, shall, as appropriate, use exist16 ing emission test cycles and updated adjustment factors 

17 to update and revise the process used to determine fuel 

18 economy values for labeling purposes as described in sec19 tions 600.209-85 and 600.209-95 of title 40, Code of Fed20 eral Regulations (or successor regulations) to take into 

21 consideration current factors, such as— 

22 (1) speed limits; 

23 (2) acceleration rates; 

24 (3) braking; 

25 (4) variations in weather and temperature; 


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1 (5) vehicle load; 

2 (6) use of air conditioning; 

3 (7) driving patterns; and 

4 (8) the use of other fuel-consuming features. 

5 (b) DEADLINE.—In carrying out subsection (a), the 

6 Administrator shall— 

7 (1) issue a notice of proposed rulemaking not 

8 later than 90 days after the date of enactment of 

9 this Act; and 

10 (2) promulgate a final rule not later than 180 

11 days after the date on which the notice under para12 graph (1) is issued. 

13 (c) COMPLEMENTARY CONSUMER INFORMATION.— 

14 The Administrator, using the most recent data available 

15 to the Administrator, shall augment fuel economy labels 

16 to provide easily understandable information on the safety 

17 rating and air pollution and climate change impacts of a 

18 new vehicle as compared to the safety ratings and climate 

19 change impacts of other comparable vehicles. 

20 (d) REEVALUATION AND REPORT.—Not later than 3 

21 years after the date of promulgation of the final rule under 

22 subsection (b)(2), and triennially thereafter, the Adminis23 trator shall— 

24 (1) reevaluate the fuel economy labeling proce25 dures described in subsections (a) and (c) to deterVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00093 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 mine whether changes in the factors used to estab2 lish the labeling procedures warrant a revision of 

3 that process; and 

4 (2) submit to the Committee on Commerce, 

5 Science, and Transportation of the Senate and the 

6 Committee on Energy and Commerce of the House 

7 of Representatives a report that describes the results 

8 of the reevaluation process. 

9 SEC. 262. TIRE EFFICIENCY LABELING PROGRAM. 

10 (a) STANDARDS FOR TIRES MANUFACTURED FOR

11 INTERSTATE COMMERCE.—Section 30123(b) of title 49, 

12 United States Code, is amended to read as follows: 

13 ‘‘(b) TIRE GRADING AND MARKETING.— 

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

15 ‘‘(A) IN GENERAL.—The Secretary shall 

16 prescribe, by regulation, a uniform quality grad17 ing system for motor vehicle tires to assist con18 sumers to make informed decisions when pur19 chasing tires. 

20 ‘‘(B) INCLUSION.—The grading system es21 tablished pursuant to subparagraph (A) shall 

22 include standards for rating the fuel efficiency 

23 of tires designed for use on vehicles. 

24 ‘‘(2) NOMENCLATURE AND MARKETING PRAC25 TICES.—The Secretary shall cooperate with industry 


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1 and the Federal Trade Commission to the greatest 

2 extent practicable to eliminate deceptive and con3 fusing tire nomenclature and marketing practices. 

4 ‘‘(3) EFFECT OF STANDARDS AND REGULA5 TIONS.—A tire standard or regulation prescribed 

6 pursuant to this chapter supercedes an order or ad7 ministrative interpretation of the Commission.’’. 

8 (b) NATIONAL TIRE FUEL EFFICIENCY PROGRAM.— 

9 (1) IN GENERAL.—Chapter 329 of title 49, 

10 United States Code, is amended by adding at the 

11 end the following: 

12 ‘‘§ 32920. National tire fuel economy program 

13 ‘‘(a) DEFINITION.—In this section, the term ‘fuel 

14 economy’, with respect to a tire, means the extent to which 

15 the tire contributes to the reduction in fuel usage of the 

16 motor vehicle on which the tire is mounted. 

17 ‘‘(b) PROGRAM.—The Secretary shall establish a na18 tional tire fuel economy program for vehicle tires. 

19 ‘‘(c) REQUIREMENTS.—Not later than March 31, 

20 2008, the Secretary shall issue regulations, which estab21 lish— 

22 ‘‘(1) policies and procedures for testing and la23 beling tires for fuel economy to enable tire buyers to 

24 make informed purchasing decisions about the fuel 

25 economy of tires; 


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1 ‘‘(2) policies and procedures to promote the 

2 purchase of energy efficient replacement tires, in3 cluding— 

4 ‘‘(A) purchase incentives; 

5 ‘‘(B) website listings on the Internet; 

6 ‘‘(C) printed fuel economy guide booklets; 

7 and 

8 ‘‘(D) mandatory requirements for tire re9 tailers to provide tire buyers with fuel efficiency 

10 information on tires; and 

11 ‘‘(3) minimum fuel economy standards for tires. 

12 ‘‘(d) MINIMUM FUEL ECONOMY STANDARDS.—In 

13 promulgating minimum fuel economy standards for tires, 

14 the Secretary shall develop standards that— 

15 ‘‘(1) ensure, in conjunction with the require16 ments under subsection (c)(2), that the average fuel 

17 economy of replacement tires is not less than the av18 erage fuel economy of tires sold as original equip19 ment; 

20 ‘‘(2) secure the maximum technically feasible 

21 and cost-effective fuel savings; 

22 ‘‘(3) do not adversely affect tire safety; 

23 ‘‘(4) incorporate the results from— 

24 ‘‘(A) laboratory testing; and 


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1 ‘‘(B) to the extent appropriate and avail2 able, on-road fleet testing programs conducted 

3 by manufacturers; and 

4 ‘‘(5) do not adversely affect efforts to manage 

5 scrap tires. 

6 ‘‘(e) APPLICABILITY.—The policies, procedures, and 

7 standards developed under subsection (c) shall apply to 

8 all tire types and models regulated under the uniform tire 

9 quality grading standards in section 575.104 of title 49, 

10 Code of Federal Regulations, as in effect on the date of 

11 the enactment of this section. 

12 ‘‘(f) REVIEW.— 

13 ‘‘(1) IN GENERAL.—Not less than once every 3 

14 years, the Secretary shall— 

15 ‘‘(A) review the minimum fuel economy 

16 standards in effect for tires under this sub17 section; and 

18 ‘‘(B) subject to paragraph (2), revise the 

19 standards as necessary to ensure compliance 

20 with standards described in subsection (d). 

21 ‘‘(2) LIMITATION.—The Secretary may not re22 duce the average fuel economy standards applicable 

23 to replacement tires. 

24 ‘‘(g) NO PREEMPTION OF STATE LAW.—Nothing in 

25 this section shall be construed to preempt any provision 


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1 of State law relating to higher fuel economy standards ap2 plicable to replacement tires designed for use on vehicles. 

3 ‘‘(h) EXCEPTIONS.—Nothing in this section shall 

4 apply to— 

5 ‘‘(1) a tire or group of tires with the same stock 

6 keeping unit, plant, and year, for which the volume 

7 of tires produced or imported is less than 15,000 an8 nually; 

9 ‘‘(2) a deep tread, winter-type snow tire, space10 saver tire, or temporary use spare tire; 

11 ‘‘(3) a tire with a normal rim diameter of 12 

12 inches or less; 

13 ‘‘(4) a motorcycle tire; or 

14 ‘‘(5) a tire manufactured specifically for use in 

15 an off-road motorized recreational vehicle. 

16 ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There 

17 are authorized to be appropriated, for each of fiscal years 

18 2007 through 2011, such sums as may be necessary to 

19 carry out this section.’’. 

20 (2) CLERICAL AMENDMENT.—The table of sec21 tions for chapter 329 of title 49, United States 

22 Code, is amended by adding after the item relating 

23 to section 32919 the following: 

‘‘Sec. 32920. National tire fuel economy program.’’. 

24 (c) CONFORMING AMENDMENT.—Section 

25 30103(b)(1) of title 49, United States Code, is amended 


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

2 section 30920, if’’. 

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

4 this section shall take effect on March 31, 2008. 

5 SEC. 263. NEW VEHICLE OPTIONS TO EMPOWER DRIVERS 

6 TO REDUCE FUEL USE. 

7 Not later than 18 months after the date of the enact8 ment of this Act, the Secretary of Transportation, in con9 sultation with the Administrator of the Environmental 

10 Protection Agency, shall promulgate regulations to re11 quire, beginning in 2010, that original equipment manu12 facturers of all new on-highway motor vehicles sold in the 

13 United States provide purchasers with the vehicle options 

14 that will— 

15 (1) use on-board electronic instruments to pro16 vide real-time fuel consumption data; 

17 (2) use on-board electronic instruments to sig18 nal a driver when inadequate tire pressure is affect19 ing vehicle safety or fuel economy; and 

20 (3) a device that will allow drivers to voluntarily 

21 place their vehicle in a mode that will automatically 

22 produce greater fuel economy. 

23 SEC. 264. IDLING REDUCTION TAX CREDIT. 

24 (a) IN GENERAL.—Subpart D of part IV of sub25 chapter A of chapter 1 of the Internal Revenue Code of 


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1 1986 (relating to business-related credits), as amended by 

2 this Act, is amended by adding at the end the following 

3 new section: 

4 ‘‘SEC. 45O. IDLING REDUCTION CREDIT. 

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

6 the idling reduction tax credit determined under this sec7 tion for the taxable year is an amount equal to 25 percent 

8 of the amount paid or incurred for each qualifying idling 

9 reduction device placed in service by the taxpayer during 

10 the taxable year. 

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

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

13 device. 

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

15 (a)— 

16 ‘‘(1) QUALIFYING IDLING REDUCTION DE17 VICE.—The term ‘qualifying idling reduction device’ 

18 means any device or system of devices that— 

19 ‘‘(A) is installed on a heavy-duty diesel20 powered on-highway vehicle, 

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

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

23 electricity) that would otherwise require the op24 eration of the main drive engine while the vehi25 cle is temporarily parked or remains stationary, 


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

2 with the taxpayer, 

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

4 and not for resale, and 

5 ‘‘(E) is certified by the Secretary of En6 ergy, in consultation with the Administrator of 

7 the Environmental Protection Agency and the 

8 Secretary of Transportation, to reduce long-du9 ration idling of such vehicle at a motor vehicle 

10 rest stop or other location where such vehicles 

11 are temporarily parked or remain stationary. 

12 ‘‘(2) HEAVY-DUTY DIESEL-POWERED ON-HIGH13 WAY VEHICLE.—The term ‘heavy-duty diesel-pow14 ered on-highway vehicle’ means any vehicle, ma15 chine, tractor, trailer, or semi-trailer propelled or 

16 drawn by mechanical power and used upon the high17 ways in the transportation of passengers or prop18 erty, or any combination thereof determined by the 

19 Federal Highway Administration. 

20 ‘‘(3) LONG-DURATION IDLING.—The term ‘long21 duration idling’ means the operation of a main drive 

22 engine, for a period greater than 15 consecutive 

23 minutes, where the main drive engine is not engaged 

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1 pages associated with traffic movement or conges2 tion. 

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

4 section— 

5 ‘‘(1) REDUCTION IN BASIS.—If a credit is de6 termined under this section with respect to any 

7 property by reason of expenditures described in sub8 section (a), the basis of such property shall be re9 duced by the amount of the credit so determined. 

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

11 deduction or credit shall be allowed under any other 

12 provision of this chapter with respect to the amount 

13 of the credit determined under this section. 

14 ‘‘(e) ELECTION NOT TO CLAIM CREDIT.—This sec15 tion shall not apply to a taxpayer for any taxable year 

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

17 such taxable year. 

18 ‘‘(f) TERMINATION.—This section shall not apply 

19 with respect to any property placed in service after Decem20 ber 31, 2014.’’. 

21 (b) CREDIT TO BE PART OF GENERAL BUSINESS

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

23 Revenue Code of 1986 (relating to general business cred24 it), as amended by this Act, is amended by striking ‘‘plus’’ 

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


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1 the end of paragraph (31) and inserting ‘‘, plus’’ , and 

2 by adding at the end the following new paragraph: 

3 ‘‘(32) the idling reduction tax credit determined 

4 under section 45O(a).’’. 

5 (c) CONFORMING AMENDMENTS.— 

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

7 IV of subchapter A of chapter 1 of the Internal Rev8 enue Code of 1986, as amended by this Act, is 

9 amended by inserting after the item relating to sec10 tion 45N the following new item: 

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

11 (2) Section 1016(a) of such Code, as amended 

12 by this Act, is amended by striking ‘‘and’’ at the end 

13 of paragraph (37), by striking the period at the end 

14 of paragraph (38) and inserting ‘‘, and’’, and by 

15 adding at the end the following: 

16 ‘‘(39) in the case of a facility with respect to 

17 which a credit was allowed under section 45O, to the 

18 extent provided in section 45O(d)(1). 

19 ‘‘(40) Section 6501(m) of such Code is amend20 ed by inserting ‘45O(e),’ after ‘45D(c)(4),’.’’. 

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

22 this section shall apply to taxable years beginning after 

23 December 31, 2006. 

24 (e) DETERMINATION OF CERTIFICATION STANDARDS

25 BY SECRETARY OF ENERGY FOR CERTIFYING IDLING REVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00103 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 DUCTION DEVICES.—Not later than 6 months after the 

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

3 air pollution and fuel consumption, the Secretary of En4 ergy, in consultation with the Administrator of the Envi5 ronmental Protection Agency and the Secretary of Trans6 portation, shall publish the standards under which the 

7 Secretary, in consultation with the Administrator of the 

8 Environmental Protection Agency and the Secretary of 

9 Transportation, will, for purposes of section 45O of the 

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

11 certify the idling reduction devices which will reduce long12 duration idling of vehicles at motor vehicle rest stops or 

13 other locations where such vehicles are temporarily parked 

14 or remain stationary in order to reduce air pollution and 

15 fuel consumption. 

16 Subtitle H—Providing Consumers 

17 With Additional Advanced Tech18 nology Vehicle Purchase Incen19 tives 

20 SEC. 271. EXPANSION AND EXTENSION OF ALTERNATIVE 

21 MOTOR VEHICLE CREDIT. 

22 (a) INCREASES IN CREDIT.— 

23 (1) NEW QUALIFIED FUEL CELL MOTOR VEHI24 CLE.—Subsection (b) of section 30B of the Internal 


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1 Revenue Code of 1986 (relating to new qualified fuel 

2 cell motor vehicle credit) is amended— 

3 (A) in paragraph (1)— 

4 (i) by striking ‘‘$8,000 ($4,000’’ in 

5 subparagraph (A) and inserting ‘‘$16,000 

6 ($8,000’’; 

7 (ii) by striking ‘‘$10,000’’ in subpara8 graph (B) and inserting ‘‘$20,000’’; 

9 (iii) by striking ‘‘$20,000’’ in sub10 paragraph (C) and inserting ‘‘$40,000’’; 

11 and 

12 (iv) by striking ‘‘$40,000’’ in subpara13 graph (D) and inserting ‘‘$80,000’’; and 

14 (B) in paragraph (2)(A)— 

15 (i) by striking ‘‘$1,000’’ in clause (i) 

16 and inserting ‘‘$2,000’’; 

17 (ii) by striking ‘‘$1,500’’ in clause (ii) 

18 and inserting ‘‘$3,000’’; 

19 (iii) by striking ‘‘$2,000’’ in clause 

20 (iii) and inserting ‘‘$4,000’’; 

21 (iv) by striking ‘‘$2,500’’ in clause 

22 (iv) and inserting ‘‘$5,000’’; 

23 (v) by striking ‘‘$3,000’’ in clause (v) 

24 and inserting ‘‘$6,000’’; 


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1 (vi) by striking ‘‘$3,500’’ in clause 

2 (vi) and inserting ‘‘$7,000’’; and 

3 (vii) by striking ‘‘$4,000’’ in clause 

4 (vii) and inserting ‘‘$8,000’’. 

5 (2) NEW ADVANCED LEAN BURN TECHNOLOGY

6 MOTOR VEHICLE.— 

7 (A) FUEL ECONOMY.—The table in clause 

8 (i) of section 30B(c)(2)(A) of such Code (relat9 ing to fuel economy) is amended— 

10 (i) by striking ‘‘$400’’ and inserting 

11 ‘‘$800’’; 

12 (ii) by striking ‘‘$800’’ and inserting 

13 ‘‘$1,600’’; 

14 (iii) by striking ‘‘$1,200’’ and insert15 ing ‘‘$2,400’’; 

16 (iv) by striking ‘‘$1,600’’ and insert17 ing ‘‘$3,200’’; 

18 (v) by striking ‘‘$2,000’’ and inserting 

19 ‘‘$4,000’’; and 

20 (vi) by striking ‘‘$2,400’’ and insert21 ing ‘‘$4,800’’. 

22 (B) CONSERVATION.—The table in sub23 paragraph (B) of section 30B(c)(2) of such 

24 Code (relating to conservation credit) is amend25 ed— 


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1 (i) by striking ‘‘$250’’ and inserting 

2 ‘‘$500’’; 

3 (ii) by striking ‘‘$500’’ and inserting 

4 ‘‘$1,000’’; 

5 (iii) by striking ‘‘$750’’ and inserting 

6 ‘‘$1,500’’; and 

7 (iv) by striking ‘‘$1,000’’ and insert8 ing ‘‘$2,000’’. 

9 (b) EXPANSION OF NUMBER OF NEW QUALIFIED

10 HYBRID AND ADVANCED LEAN BURN TECHNOLOGY VE11 HICLES ELIGIBLE FOR CREDIT.—Paragraph (2) of section 

12 30B(f) of the Internal Revenue Code of 1986 (relating to 

13 phaseout) is amended— 

14 (1) by striking ‘‘the period’’ and inserting ‘‘any 

15 period’’, 

16 (2) by striking ‘‘United States after December 

17 31, 2005, is at least 60,000’’ and inserting ‘‘United 

18 States is— 

19 ‘‘(A) after December 31, 2005, at least 

20 60,000, and 

21 ‘‘(B) after December 31, 2008, and before 

22 January 1, 2013, 60,000.’’, and 

23 (3) by adding at the end the following new sen24 tence: ‘‘For purposes of the preceding sentence, the 

25 Secretary may extend the time period through 2014 


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1 if the Secretary determines that market conditions 

2 merit such action.’’. 

3 (c) EXTENSION.—Section 30B(j) of the Internal Rev4 enue Code of 1986 (relating to termination) is amended— 

5 (1) by striking ‘‘December 31, 2010’’ both 

6 places it appears and inserting ‘‘December 31, 

7 2014’’, and 

8 (2) by striking ‘‘December 31, 2009’’ in para9 graph (3) and inserting ‘‘December 31, 2014’’. 

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

11 this section shall take effect as if included in the amend12 ments made by section 1341(a) of the Energy Policy Act 

13 of 2005. 

14 SEC. 272. PLUG-IN HYBRID MOTOR VEHICLE TAX CREDIT. 

15 (a) IN GENERAL.—Section 30B of the Internal Rev16 enue Code of 1986 is amended by redesignating sub17 sections (i) and (j) as subsections (j) and (k), respectively, 

18 and by inserting after subsection (h) the following new 

19 subsection: 

20 ‘‘(i) NEW PLUG-IN HYBRID MOTOR VEHICLE CRED21 IT.— 

22 ‘‘(1) IN GENERAL.—For purposes of subsection 

23 (a), the new plug-in hybrid motor vehicle credit de24 termined under this subsection with respect to a new 

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1 fied flexible-fuel plug-in hybrid motor vehicle placed 

2 in service by the taxpayer during the taxable year 

3 is— 

4 ‘‘(A) $3,000, if such vehicle is a new quali5 fied plug-in hybrid motor vehicle with a gross 

6 vehicle weight rating of not more than 8,500 

7 pounds, and 

8 ‘‘(B) $3,150, if such vehicle is a new quali9 fied flexible-fuel plug-in hybrid motor vehicle 

10 with a gross vehicle weight rating of not more 

11 than 8,500 pounds. 

12 ‘‘(2) INCREASE FOR FUEL EFFICIENCY.— 

13 ‘‘(A) IN GENERAL.—The amount deter14 mined under paragraph (1)(A) with respect to 

15 a new qualified plug-in hybrid motor vehicle or 

16 new qualified flexible-fuel plug-in hybrid motor 

17 vehicle which is a passenger automobile or light 

18 truck shall be increased by— 

19 ‘‘(i) $1,000 if such vehicle achieves at 

20 least 250 percent but less than 250 per21 cent of the 2002 model year city fuel econ22 omy, 

23 ‘‘(ii) $1,500 if such vehicle achieves at 

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1 cent of the 2002 model year city fuel econ2 omy, 

3 ‘‘(iii) $2,000 if such vehicle achieves 

4 at least 275 percent but less than 300 per5 cent of the 2002 model year city fuel econ6 omy, 

7 ‘‘(iv) $2,500 if such vehicle achieves 

8 at least 300 percent but less than 325 per9 cent of the 2002 model year city fuel econ10 omy, and 

11 ‘‘(v) $3,000 if such vehicle achieves at 

12 least 325 percent of the 2002 model year 

13 city fuel economy, 

14 ‘‘(B) 2002 MODEL YEAR CITY FUEL ECON15 OMY.—For purposes of subparagraph (A), the 

16 2002 model year city fuel economy with respect 

17 to a vehicle shall be determined using the tables 

18 provided in subsection (b)(2)(B). 

19 ‘‘(3) NEW QUALIFIED PLUG-IN HYBRID MOTOR

20 VEHICLE.—For purposes of this subsection, the term 

21 ‘new qualified plug-in hybrid motor vehicle’ means a 

22 motor vehicle— 

23 ‘‘(A) which is propelled by an internal 

24 combustion engine or heat engine using — 

25 ‘‘(i) any combustible fuel, 


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1 ‘‘(ii) an on-board, rechargeable stor2 age device, and 

3 ‘‘(iii) a means of using an off-board 

4 source of electricity, 

5 ‘‘(B) which, in the case of a passenger 

6 automobile or light truck, has received on or 

7 after the date of the enactment of this section 

8 a certificate that such vehicle meets or exceeds 

9 the Bin 5 Tier II emission level established in 

10 regulations prescribed by the Administrator of 

11 the Environmental Protection Agency under 

12 section 202(i) of the Clean Air Act for that 

13 make and model year vehicle, 

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

15 with the taxpayer, 

16 ‘‘(D) which is acquired for use or lease by 

17 the taxpayer and not for resale, and 

18 ‘‘(E) which is made by a manufacturer. 

19 ‘‘(4) NEW QUALIFIED FLEXIBLE-FUEL PLUG-IN

20 HYBRID MOTOR VEHICLE.—For purposes of this 

21 subsection, the term ‘new qualified flexible-fuel plug22 in hybrid motor vehicle’ means a motor vehicle— 

23 ‘‘(A) which is propelled by an internal 

24 combustion engine or heat engine using— 


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1 ‘‘(i) an on-board, rechargeable storage 

2 device, and 

3 ‘‘(ii) a means of using an off-board 

4 source of electricity, 

5 ‘‘(B) which is warrantied by its manufac6 turer to operate on any combination of gasoline 

7 and a fuel blend containing up to 85 percent 

8 ethanol and 15 percent gasoline by volume 

9 (E85), 

10 ‘‘(C) which, in the case of a passenger 

11 automobile or light truck, has received on or 

12 after the date of the enactment of this section 

13 a certificate that such vehicle meets or exceeds 

14 the Bin 5 Tier II emission level established in 

15 regulations prescribed by the Administrator of 

16 the Environmental Protection Agency under 

17 section 202(i) of the Clean Air Act for that 

18 make and model year vehicle, 

19 ‘‘(D) the original use of which commences 

20 with the taxpayer, 

21 ‘‘(E) which is acquired for use or lease by 

22 the taxpayer and not for resale, and 

23 ‘‘(F) which is made by a manufacturer.’’. 

24 (b) CONFORMING AMENDMENTS.— 


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1 (1) Section 30B(a) of the Internal Revenue 

2 Code of 1986 is amended by striking ‘‘and’’ at the 

3 end of paragraph (3), by striking the period at the 

4 end of paragraph (4) and inserting ‘‘, and’’, and by 

5 adding at the end the following new paragraph: 

6 ‘‘(5) the new plug-in hybrid motor vehicle credit 

7 determined under subsection (i).’’. 

8 (2) Section 30B(k)(2) of such Code, as redesig9 nated by subsection (a), is amended by striking ‘‘or’’ 

10 and inserting a comma and by inserting ‘‘, a new 

11 qualified plug-in hybrid motor vehicle (as described 

12 in subsection (i)(3)), or a new qualified flexible-fuel 

13 plug-in hybrid motor vehicle (as described in sub14 section (i)(4))’’ after ‘‘subsection (d)(2)(A))’’. 

15 (c) EFFECTIVE DATE.—The amendments made by 

16 this section shall apply to property placed in service after 

17 the date of the enactment of this Act, in taxable years 

18 ending after such date. 

19 Subtitle I—Tax Incentives for Fuel 

20 Efficient Private Fleets 

21 SEC. 281. TAX CREDIT FOR FUEL-EFFICIENT FLEETS. 

22 (a) IN GENERAL.—Subpart E of part IV of sub23 chapter A of chapter 1 of the Internal Revenue Code of 

24 1986 is amended by inserting after section 48B the fol25 lowing new section: 


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1 ‘‘SEC. 48C. FUEL-EFFICIENT FLEET CREDIT. 

2 ‘‘(a) GENERAL RULE.—For purposes of section 46, 

3 the fuel-efficient fleet credit for any taxable year is 15 per4 cent of the qualified fuel-efficient vehicle investment 

5 amount of an eligible taxpayer for such taxable year. 

6 ‘‘(b) VEHICLE PURCHASE REQUIREMENT.—In the 

7 case of any eligible taxpayer which places less than 10 

8 qualified fuel-efficient vehicles in service during the tax9 able year, the qualified fuel-efficient vehicle investment 

10 amount shall be zero. 

11 ‘‘(c) QUALIFIED FUEL-EFFICIENT VEHICLE INVEST12 MENT AMOUNT.—For purposes of this section— 

13 ‘‘(1) IN GENERAL.—The term ‘qualified fuel-ef14 ficient vehicle investment amount’ means the basis 

15 of any qualified fuel-efficient vehicle placed in serv16 ice by an eligible taxpayer during the taxable year. 

17 ‘‘(2) QUALIFIED FUEL-EFFICIENT VEHICLE.— 

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

19 fuel-efficient vehicle’ means an vehicle which 

20 has a fuel economy which is at least 150 per21 cent greater than the average fuel economy 

22 standard for an vehicle of the same class and 

23 model year. 

24 ‘‘(B) CERTAIN VEHICLES EXCLUDED.— 

25 Such term shall not include any vehicle for 


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1 which a credit is allowed to the eligible taxpayer 

2 under section 30 or 30B. 

3 ‘‘(3) OTHER TERMS.—The terms ‘vehicle’, ‘av4 erage fuel economy standard’, ‘fuel economy’, and 

5 ‘model year’ have the meanings given to such terms 

6 under section 32901 of title 49, United States Code. 

7 ‘‘(d) ELIGIBLE TAXPAYER.—The term ‘eligible tax8 payer’ means, with respect to any taxable year, a taxpayer 

9 who owns a fleet of 100 or more vehicles which are used 

10 in the trade or business of the taxpayer on the first day 

11 of such taxable year. 

12 ‘‘(e) TERMINATION.—This section shall not apply to 

13 any vehicle placed in service after December 31, 2010.’’. 

14 (b) CREDIT TREATED AS PART OF INVESTMENT

15 CREDIT.—Section 46 of the Internal Revenue Code of 

16 1986 is amended by striking ‘‘and’’ at the end of para17 graph (3), by striking the period at the end of paragraph 

18 (4) and inserting ‘‘, and,’’ and by adding at the end the 

19 following new paragraph: 

20 ‘‘(5) the fuel-efficient fleet credit.’’. 

21 (c) CONFORMING AMENDMENTS.— 

22 (1) Section 49(a)(1)(C) of the Internal Revenue 

23 Code of 1986 is amended by striking ‘‘and’’ at the 

24 end of clause (iii), by striking the period at the end 


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1 of clause (iv) and inserting ‘‘, and,’’ and by adding 

2 at the end the following new clause: 

3 ‘‘(v) the basis of any qualified fuel-ef4 ficient vehicle which is taken into account 

5 under section 48C.’’. 

6 (2) The table of sections for subpart E of part 

7 IV of subchapter A of chapter 1 of such Code is 

8 amended by inserting after the item relating to sec9 tion 48 the following new item: 

‘‘Sec. 48C. Fuel-efficient fleet credit.’’. 

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

11 this section shall apply to periods after December 31, 

12 2005, in taxable years ending after such date, under rules 

13 similar to the rules of section 48(m) of the Internal Rev14 enue Code of 1986 (as in effect on the day before the date 

15 of the enactment of the Revenue Reconciliation Act of 

16 1990). 

17 TITLE III— ACCELERATING 

18 CLEAN FUELS AND ELECTRICITY 

19 Subtitle A—Guaranteeing a Min20 imum Level of Renewable Elec21 tricity Generation 

22 SEC. 301. RENEWABLE PORTFOLIO STANDARD. 

23 The Public Utility Regulatory Policies Act of 1978 

24 (16 U.S.C. 2601 et seq.) is amended by adding at the end 

25 of title VI the following: 


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

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

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

4 term ‘base amount of electricity’ means the total 

5 amount of electricity sold by an electric utility to 

6 electric consumers in a calendar year, excluding— 

7 ‘‘(A) electricity generated by a hydro8 electric facility (including a pumped storage fa9 cility but excluding incremental hydropower); 

10 and 

11 ‘‘(B) electricity generated through the in12 cineration of municipal solid waste. 

13 ‘‘(2) DISTRIBUTED GENERATION FACILITY.— 

14 The term ‘distributed generation facility’ means a 

15 facility at a customer site. 

16 ‘‘(3) EXISTING RENEWABLE ENERGY.—The 

17 term ‘existing renewable energy’ means, except as 

18 provided in paragraph (7)(B), electric energy gen19 erated at a facility (including a distributed genera20 tion facility) placed in service prior to the date of 

21 enactment of this section from— 

22 ‘‘(A) solar, wind, or geothermal energy; 

23 ‘‘(B) ocean energy; 

24 ‘‘(C) biomass (as defined in section 203(b) 

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

26 15852(b))); or 


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1 ‘‘(D) landfill gas. 

2 ‘‘(4) GEOTHERMAL ENERGY.—The term ‘geo3 thermal energy’ means energy derived from a geo4 thermal deposit (within the meaning of section 

5 613(e)(2) of the Internal Revenue Code of 1986). 

6 ‘‘(5) INCREMENTAL GEOTHERMAL PRODUC7 TION.— 

8 ‘‘(A) IN GENERAL.—The term ‘incremental 

9 geothermal production’ means, for any year, the 

10 difference between— 

11 ‘‘(i) the total kilowatt hours of elec12 tricity produced from a facility (including a 

13 distributed generation facility) using geo14 thermal energy, and 

15 ‘‘(ii) the average annual kilowatt 

16 hours produced at the facility for 5 of the 

17 7 calendar years preceding the date of en18 actment of this section after eliminating 

19 the highest and the lowest kilowatt hour 

20 production years in that 7-year period. 

21 ‘‘(B) SPECIAL RULE.—A facility described 

22 in subparagraph (A) that was placed in service 

23 at least 7 years before the date of enactment of 

24 this section shall, beginning with the year in 

25 which that date of enactment occurs, reduce the 


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1 amount calculated under subparagraph (A)(ii) 

2 each year, on a cumulative basis, by the average 

3 percentage decrease in the annual kilowatt hour 

4 production for the 7-year period described in 

5 subparagraph (A)(ii), the cumulative sum of 

6 which shall not exceed 30 percent. 

7 ‘‘(6) INCREMENTAL HYDROPOWER.— 

8 ‘‘(A) IN GENERAL.—The term ‘incremental 

9 hydropower’ means additional energy generated 

10 as a result of efficiency improvements or capac11 ity additions made on or after the date of en12 actment of this section or the effective date of 

13 an existing applicable State renewable portfolio 

14 standard program at a hydroelectric facility 

15 that was placed in service before that date. 

16 ‘‘(B) EXCLUSIONS.—The term ‘incre17 mental hydropower’ does not include additional 

18 energy generated as a result of operational 

19 changes not directly associated with efficiency 

20 improvements or capacity additions. 

21 ‘‘(C) MEASUREMENT OF IMPROVEMENTS

22 AND ADDITIONS.—Efficiency improvements and 

23 capacity additions referred to in subparagraph 

24 (A) shall be measured on the basis of the same 

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1 toric average annual generation baseline for the 

2 hydroelectric facility and certified by the Sec3 retary or the Federal Energy Regulatory Com4 mission. 

5 ‘‘(7) NEW RENEWABLE ENERGY.—The term 

6 ‘new renewable energy’ means— 

7 ‘‘(A) electric energy generated at a facility 

8 (including a distributed generation facility) 

9 placed in service on or after January 1, 2003, 

10 from— 

11 ‘‘(i) solar, wind, or geothermal energy 

12 or ocean energy; 

13 ‘‘(ii) biomass (as defined in section 

14 203(b) of the Energy Policy Act of 2005 

15 (42 U.S.C. 15852(b))); 

16 ‘‘(iii) landfill gas; or 

17 ‘‘(iv) incremental hydropower; and 

18 ‘‘(B) for electric energy generated at a fa19 cility (including a distributed generation facil20 ity) placed in service before the date of enact21 ment of this section— 

22 ‘‘(i) the additional energy above the 

23 average generation in the 3 years pre24 ceding the date of enactment of this sec25 tion at the facility from— 


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1 ‘‘(I) solar or wind energy or 

2 ocean energy; 

3 ‘‘(II) biomass (as defined in sec4 tion 203(b) of the Energy Policy Act 

5 of 2005 (42 U.S.C. 15852(b))); 

6 ‘‘(III) landfill gas; or 

7 ‘‘(IV) incremental hydropower; 

8 and 

9 ‘‘(ii) the incremental geothermal pro10 duction. 

11 ‘‘(8) OCEAN ENERGY.—The term ‘ocean energy’ 

12 includes current, wave, tidal, and thermal energy. 

13 ‘‘(b) RENEWABLE ENERGY REQUIREMENT.— 

14 ‘‘(1) REQUIREMENT.— 

15 ‘‘(A) IN GENERAL.—Each electric utility 

16 that sells electricity to electric consumers shall 

17 obtain a percentage of the base amount of elec18 tricity the electric utility sells to electric con19 sumers in any calendar year from new renew20 able energy or existing renewable energy. 

21 ‘‘(B) PERCENTAGES.—The percentage ob22 tained in a calendar year shall not be less than 

23 the amount specified in the following table: 

‘‘Calendar year Min. annual percentage 

2008 through 2011 ................................................ 2.5 

2012 through 2015 ................................................ 5.0 


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2016 through 2019 ................................................ 7.5 

2020 through 2030 ................................................ 10.0 

1 ‘‘(2) MEANS OF COMPLIANCE.—An electric util2 ity shall meet the requirements of paragraph (1) 

3 by— 

4 ‘‘(A) generating electric energy using new 

5 renewable energy or existing renewable energy; 

6 ‘‘(B) purchasing electric energy generated 

7 by new renewable energy or existing renewable 

8 energy; 

9 ‘‘(C) purchasing renewable energy credits 

10 issued under subsection (c); or 

11 ‘‘(D) a combination of the foregoing. 

12 ‘‘(c) RENEWABLE ENERGY CREDIT TRADING PRO13 GRAM.— 

14 ‘‘(1) IN GENERAL.—Not later than January 1, 

15 2007, the Secretary shall establish a renewable en16 ergy credit trading program to permit an electric 

17 utility that does not generate or purchase enough 

18 electric energy from renewable energy to meet its ob19 ligations under subsection (b)(1) to satisfy the re20 quirements by purchasing sufficient renewable en21 ergy credits. 

22 ‘‘(2) RESPONSIBILITIES OF SECRETARY.—As 

23 part of the program, the Secretary shall— 


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1 ‘‘(A) issue renewable energy credits to gen2 erators of electric energy from new renewable 

3 energy; 

4 ‘‘(B) sell renewable energy credits to elec5 tric utilities at the rate of 1.5 cents per kilo6 watt-hour (as adjusted for inflation under sub7 section (h)); 

8 ‘‘(C) ensure that a kilowatt hour, including 

9 the associated renewable energy credit, shall be 

10 used only once for purposes of compliance with 

11 this section; and 

12 ‘‘(D) allow double credits for generation 

13 from facilities on Indian land, and triple credits 

14 for generation from small renewable distributed 

15 generators (meaning those no larger than 1 

16 megawatt). 

17 ‘‘(3) USE OF CREDITS.—A credit under para18 graph (2)(A) may only be used for compliance with 

19 this section for the 3-year period beginning on the 

20 date of issuance of the credit. 

21 ‘‘(d) ENFORCEMENT.— 

22 ‘‘(1) CIVIL PENALTIES.—Any electric utility 

23 that fails to meet the renewable energy requirements 

24 of subsection (b) shall be subject to a civil penalty. 


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1 ‘‘(2) AMOUNT OF PENALTY.—The amount of 

2 the civil penalty shall be determined by multiplying 

3 the number of kilowatt-hours of electric energy sold 

4 to electric consumers in violation of subsection (b) 

5 by the greater of 1.5 cents (adjusted for inflation 

6 under subsection (h)) or 200 percent of the average 

7 market value of renewable energy credits during the 

8 year in which the violation occurred. 

9 ‘‘(3) MITIGATION OR WAIVER.— 

10 ‘‘(A) IN GENERAL.—The Secretary may 

11 mitigate or waive a civil penalty under this sub12 section if the electric utility was unable to com13 ply with subsection (b) for reasons outside of 

14 the reasonable control of the utility. 

15 ‘‘(B) REDUCTION OF AMOUNT.—The Sec16 retary shall reduce the amount of any penalty 

17 determined under paragraph (2) by an amount 

18 paid by the electric utility to a State for failure 

19 to comply with the requirement of a State re20 newable energy program if the State require21 ment is greater than the applicable requirement 

22 of subsection (b). 

23 ‘‘(4) PROCEDURE FOR ASSESSING PENALTY.— 

24 The Secretary shall assess a civil penalty under this 

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1 scribed by section 333(d) of the Energy Policy and 

2 Conservation Act of 1954 (42 U.S.C. 6303). 

3 ‘‘(e) STATE RENEWABLE ENERGY ACCOUNT PRO4 GRAM.— 

5 ‘‘(1) IN GENERAL.—Not later than December 

6 31, 2008, the Secretary shall establish a State re7 newable energy account program. 

8 ‘‘(2) DEPOSIT OF AMOUNTS.—All funds col9 lected by the Secretary from the sale of renewable 

10 energy credits and the assessment of civil penalties 

11 under this section shall be deposited into the renew12 able energy account established pursuant to this 

13 subsection. 

14 ‘‘(3) MAINTENANCE OF ACCOUNT.—The State 

15 renewable energy account shall be held by the Sec16 retary and shall not be transferred to the Treasury 

17 Department. 

18 ‘‘(4) USE OF AMOUNTS.—Proceeds deposited in 

19 the State renewable energy account shall be used by 

20 the Secretary, subject to appropriations, for a pro21 gram to provide grants to the State agency respon22 sible for developing State energy conservation plans 

23 under section 362 of the Energy Policy and Con24 servation Act (42 U.S.C. 6322) for the purposes of 

25 promoting renewable energy production, including 


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1 programs that promote technologies that reduce the 

2 use of electricity at customer sites such as solar 

3 water heating. 

4 ‘‘(5) GUIDELINES AND CRITERIA.—The Sec5 retary may issue guidelines and criteria for grants 

6 awarded under this subsection. 

7 ‘‘(6) MAINTENANCE OF RECORDS AND EVI8 DENCE OF COMPLIANCE.—State energy offices re9 ceiving grants under this section shall maintain such 

10 records and evidence of compliance as the Secretary 

11 may require. 

12 ‘‘(7) ALLOCATION OF FUNDS.—In allocating 

13 funds under this program, the Secretary shall give 

14 preference— 

15 ‘‘(A) to States in regions that have a dis16 proportionately small share of economically sus17 tainable renewable energy generation capacity; 

18 and 

19 ‘‘(B) to State programs to stimulate or en20 hance innovative renewable energy technologies. 

21 ‘‘(f) RULES.—Not later than 1 year after the date 

22 of enactment of this section, the Secretary shall issue rules 

23 implementing this section. 

24 ‘‘(g) EXEMPTIONS.—This section shall not apply in 

25 any calendar year to an electric utility that— 


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1 ‘‘(1) sold less than 4,000,000 megawatt-hours 

2 of electric energy to electric consumers during the 

3 preceding calendar year; or 

4 ‘‘(2) is located in Hawaii. 

5 ‘‘(h) INFLATION ADJUSTMENT.—Not later than De6 cember 31 of each year beginning in 2008, the Secretary 

7 shall adjust for inflation the price of a renewable energy 

8 credit under subsection (c)(2)(B) and the amount of the 

9 civil penalty per kilowatt-hour under subsection (d)(2). 

10 ‘‘(i) STATE PROGRAMS.— 

11 ‘‘(1) IN GENERAL.—Nothing in this section 

12 shall diminish any authority of a State or political 

13 subdivision thereof to adopt or enforce any law or 

14 regulation respecting renewable energy, but, except 

15 as provided in subsection (d)(3), no such law or reg16 ulation shall relieve any person of any requirement 

17 otherwise applicable under this section. 

18 ‘‘(2) FEDERAL-STATE COORDINATION.—The 

19 Secretary, in consultation with States having renew20 able energy programs, shall, to the maximum extent 

21 practicable, facilitate coordination between the Fed22 eral program and State programs. 

23 ‘‘(j) TERMINATION OF AUTHORITY.—This section 

24 and the authority provided by this section terminate on 

25 December 31, 2030.’’. 


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1 Subtitle B—Facilitating Home En2 ergy Generation Through Net 

3 Metering and Interconnection 

4 Standards 

5 SEC. 311. NET METERING. 

6 (a) ADOPTION OF STANDARD.—Section 111(d) of the 

7 Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 

8 2621(d)) is amended by striking paragraph (11) and in9 serting the following: 

10 ‘‘(11) NET METERING.— 

11 ‘‘(A) IN GENERAL.—On the request of any 

12 electric consumer served by an electric utility, 

13 the electric utility shall make available to the 

14 electric consumer net metering as provided in 

15 section 115(j). 

16 ‘‘(B) CONSIDERATION BY STATE REGU17 LATORY AUTHORITIES.—Notwithstanding sub18 sections (b) and (c) of section 112, not later 

19 than 1 year after the date of enactment of this 

20 paragraph, a State regulatory authority may 

21 consider and make a determination concerning 

22 whether it is in the public interest to decline to 

23 implement subparagraph (A) in the State. 

24 ‘‘(C) INCENTIVES.—Nothing in this para25 graph precludes a State from establishing inVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00128 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 centives to encourage on-site generating facili2 ties and net metering in addition to the require3 ment under this subsection. 

4 ‘‘(D) REPORTS.—Not later than 1 year 

5 after the date of enactment of this paragraph 

6 and annually thereafter, the Secretary shall 

7 submit to Congress a report that— 

8 ‘‘(i) describes the status of implemen9 tation by the States of subparagraph (A); 

10 ‘‘(ii) contains a list of pre-approved 

11 systems and equipment eligible for uniform 

12 interconnection treatment; and 

13 ‘‘(iii) describes the public benefits that 

14 have been derived from net metering and 

15 interconnection standards.’’. 

16 (b) SPECIAL RULES FOR NET METERING.—Section 

17 115 of the Public Utility Regulatory Policies Act of 1978 

18 (16 U.S.C. 2625) is amended by adding at the end the 

19 following: 

20 ‘‘(j) NET METERING.— 

21 ‘‘(1) DEFINITIONS.—In this subsection: 

22 ‘‘(A) ELIGIBLE ON-SITE GENERATING FA23 CILITY.—The term ‘eligible on-site generating 

24 facility’ means— 


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1 ‘‘(i) a facility on the site of a residen2 tial electric consumer with a maximum 

3 generating capacity of 25 kilowatts or less 

4 that is fueled by solar energy, wind energy, 

5 or fuel cells; and 

6 ‘‘(ii) a facility on the site of a com7 mercial electric consumer with a maximum 

8 generating capacity of 1000 kilowatts or 

9 less that is fueled solely by a renewable en10 ergy resource, landfill gas, or a high-effi11 ciency system. 

12 ‘‘(B) HIGH EFFICIENCY SYSTEM.—The 

13 term ‘high efficiency system’ means a system 

14 that is comprised of— 

15 ‘‘(i) fuel cells; or 

16 ‘‘(ii) combined heat and power. 

17 ‘‘(C) NET METERING SERVICE.—The term 

18 ‘net metering service’ means service to an elec19 tric consumer, as provided in section 

20 111(d)(11), under which electric energy gen21 erated by that electric consumer from an eligi22 ble on-site generating facility and delivered to 

23 the local distribution facilities may be used to 

24 offset electric energy provided by the electric 


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1 utility to the electric consumer during the appli2 cable billing period. 

3 ‘‘(D) RENEWABLE ENERGY RESOURCE.— 

4 The term ‘renewable energy resource’ means 

5 solar, wind, biomass, micro-freeflow-hydro, or 

6 geothermal energy. 

7 ‘‘(2) NET METERING SERVICE.—For the pur8 poses of undertaking the consideration and making 

9 the determination with respect to the standard con10 cerning net metering established by section 

11 111(d)(11), the term ‘net metering service’ means a 

12 service provided in accordance with this subsection. 

13 ‘‘(3) CHARGES BY AN ELECTRIC UTILITY.—An 

14 electric utility— 

15 ‘‘(A) shall charge the owner or operator of 

16 an on-site generating facility rates and charges 

17 that are identical to those that would be 

18 charged other electric consumers of the electric 

19 utility in the same rate class; and 

20 ‘‘(B) shall not charge the owner or oper21 ator of an on-site generating facility any addi22 tional standby, capacity, interconnection, or 

23 other rate or charge. 

24 ‘‘(4) MEASUREMENT OF QUANTITIES.—An elec25 tric utility that sells electric energy to the owner or 


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1 operator of an on-site generating facility shall meas2 ure the quantity of electric energy produced by the 

3 on-site facility and the quantity of electric energy 

4 consumed by the owner or operator of an on-site 

5 generating facility during a billing period with a sin6 gle bi-directional meter or otherwise in accordance 

7 with reasonable metering practices. 

8 ‘‘(5) QUANTITY SOLD IN EXCESS OF QUANTITY

9 SUPPLIED.—If the quantity of electric energy sold 

10 by the electric utility to an on-site generating facility 

11 exceeds the quantity of electric energy supplied by 

12 the on-site generating facility to the electric utility 

13 during the billing period, the electric utility may bill 

14 the owner or operator for the net quantity of electric 

15 energy sold, in accordance with reasonable metering 

16 practices. 

17 ‘‘(6) QUANTITY SUPPLIED IN EXCESS OF QUAN18 TITY SOLD.—If the quantity of electric energy sup19 plied by the on-site generating facility to the electric 

20 utility exceeds the quantity of electric energy sold by 

21 the electric utility to the on-site generating facility 

22 during the billing period— 

23 ‘‘(A) the electric utility may bill the owner 

24 or operator of the on-site generating facility for 


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1 the appropriate charges for the billing period in 

2 accordance with paragraph (5); and 

3 ‘‘(B) the owner or operator of the on-site 

4 generating facility shall be credited for the ex5 cess kilowatt-hours generated during the billing 

6 period with— 

7 ‘‘(i) a kilowatt-hour credit appearing 

8 on the bill for the following billing period; 

9 or 

10 ‘‘(ii) a cash refund. 

11 ‘‘(7) COMPLIANCE WITH STANDARDS.—An eligi12 ble on-site generating facility and net metering sys13 tem used by an electric consumer shall meet all ap14 plicable safety, performance, reliability, and inter15 connection standards established by the National 

16 Electrical Code, the Institute of Electrical and Elec17 tronics Engineers, and Underwriters Laboratories. 

18 ‘‘(8) REQUIREMENTS.—The Commission, after 

19 consideration of all applicable safety, performance, 

20 reliability, and interconnection standards established 

21 by the National Electrical Code, the Institute of 

22 Electrical and Electronics Engineers, and Under23 writers Laboratories, and consultation with State 

24 regulatory authorities and unregulated electric utili25 ties, and after notice and opportunity for comment, 


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1 shall promulgate additional control, testing, and 

2 interconnection requirements for on-site generating 

3 facilities and net metering systems that the Commis4 sion determines are necessary to protect public safe5 ty and system reliability.’’. 

6 Subtitle C—Long Term Extensions 

7 and Expansions for Clean En8 ergy Incentives 

9 SEC. 321. EXTENSION OF PRODUCTION TAX CREDIT FOR 

10 ELECTRICITY PRODUCED FROM CERTAIN RE11 NEWABLE RESOURCES. 

12 Section 45(d) of the Internal Revenue Code of 1986 

13 (relating to qualified facilities) is amended by striking 

14 ‘‘2008’’ each place it appears and inserting ‘‘2015’’. 

15 SEC. 322. EXTENSION AND MODIFICATION OF INVESTMENT 

16 TAX CREDIT WITH RESPECT TO SOLAR EN17 ERGY PROPERTY AND QUALIFIED FUEL CELL 

18 PROPERTY. 

19 (a) SOLAR ENERGY PROPERTY.—Paragraphs 

20 (2)(A)(i)(II) and (3)(A)(ii) of section 48(a) of the Internal 

21 Revenue Code of 1986 are each amended by striking 

22 ‘‘2008’’ and inserting ‘‘2015’’. 

23 (b) ELIGIBLE FUEL CELL PROPERTY.—Paragraph 

24 (1)(E) of section 48(c) of the Internal Revenue Code of 


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1 1986 is amended by striking ‘‘2007’’ and inserting 

2 ‘‘2014’’. 

3 (c) CREDITS ALLOWED AGAINST THE ALTERNATIVE

4 MINIMUM TAX.— 

5 (1) IN GENERAL.—Section 38(c)(4)(B) of the 

6 Internal Revenue Code of 1986 (defining specified 

7 credits), as amended by this Act, is amended by 

8 striking the period at the end of clause (iii) and in9 serting ‘‘, and,’’ and by adding at the end the fol10 lowing new clause: 

11 ‘‘(iv) the portion of the investment 

12 credit under section 46(2) as determined 

13 under section 48(a)(2)(A)(i).’’. 

14 (2) EFFECTIVE DATE.—The amendments made 

15 by this subsection shall apply to taxable years begin16 ning after December 31, 2005. 

17 (d) SOLAR INVESTMENT CREDIT ALLOWED FOR

18 PUBLIC UTILITY PROPERTY.— 

19 (1) IN GENERAL.—The second sentence of sec20 tion 48(a)(3) of the Internal Revenue Code of 1986 

21 is amended by inserting ‘‘(other than property de22 scribed in clause (i) or (ii) of subparagraph (A))’’ 

23 before ‘‘shall not’’. 

24 (2) EFFECTIVE DATE.—The amendments made 

25 by this subsection shall apply to periods after the 


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1 date of the enactment of this Act, in taxable years 

2 ending after such date, under rules similar to the 

3 rules of section 48(m) of the Internal Revenue Code 

4 of 1986 (as in effect on the day before the date of 

5 the enactment of the Revenue Reconciliation Act of 

6 1990). 

7 SEC. 323. CREDIT FOR WIND ENERGY SYSTEMS. 

8 (a) RESIDENTIAL.— 

9 (1) IN GENERAL.—Section 25D(a) of the Inter10 nal Revenue Code of 1986 is amended by striking 

11 ‘‘and’’ at the end of paragraph (2), by striking the 

12 period at the end of paragraph (3) and inserting ‘‘, 

13 and’’, and by adding at the end the following new 

14 paragraph: 

15 ‘‘(4) 30 percent of the qualified small wind en16 ergy property expenditures made by the taxpayer 

17 during such year.’’. 

18 (2) LIMITATION.—Section 25D(b)(1) of the In19 ternal Revenue Code of 1986 is amended by striking 

20 ‘‘and’’ at the end of subparagraph (B), by striking 

21 the period at the end of subparagraph (A) and in22 serting ‘‘, and’’, and by adding at the end the fol23 lowing new subparagraph: 

24 ‘‘(D) $500 with respect to each half kilo25 watt of capacity (not to exceed $2,000) of 


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1 qualifying wind turbines for which qualified 

2 small wind energy property expenditures are 

3 made.’’. 

4 (3) QUALIFIED SMALL WIND ENERGY PROP5 ERTY EXPENDITURES.—Section 25D(d) of the Inter6 nal Revenue Code of 1986 is amended by adding at 

7 the end the following new paragraph: 

8 ‘‘(4) QUALIFIED SMALL WIND ENERGY PROP9 ERTY EXPENDITURE.— 

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

11 wind energy property expenditure’ means an ex12 penditure for property which uses a qualifying 

13 wind turbine to generate electricity for use in 

14 connection with a dwelling unit located in the 

15 United States and used as a residence by the 

16 taxpayer. 

17 ‘‘(B) QUALIFYING WIND TURBINE.—The 

18 term ‘qualifying wind turbine’ means a wind 

19 turbine of 100 kilowatts of rated capacity or 

20 less which meets the latest performance rating 

21 standards published by the American Wind En22 ergy Association and which is used to generate 

23 electricity and carries at least a 5-year limited 

24 warranty covering defects in design, material, 

25 or workmanship, and, for property that is not 


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1 installed by the taxpayer, at least a 5-year lim2 ited warranty covering defects in installation.’’. 

3 (b) BUSINESS.—Section 48(a)(3)(A) of the Internal 

4 Revenue Code of 1986 (defining energy property) is 

5 amended by striking ‘‘or’’ at the end of clause (iii), by 

6 adding ‘‘or’’ at the end of clause (iv), and by inserting 

7 after clause (iv) the following new clause: 

8 ‘‘(v) qualifying wind turbine (as de9 fined in section 25D(d)(B)),’’. 

10 (c) EFFECTIVE DATE.—The amendments made by 

11 this section shall apply to property placed in service after 

12 the date of the enactment of this Act, in taxable years 

13 ending after such date. 

14 SEC. 324. EXPANSION OF RESOURCES TO WAVE, CURRENT, 

15 TIDAL, AND OCEAN THERMAL ENERGY. 

16 (a) IN GENERAL.—Section 45(c)(1) of the Internal 

17 Revenue Code of 1986 (defining qualified energy re18 sources) is amended by striking ‘‘and’’ at the end of sub19 paragraph (G), by striking the period at the end of sub20 paragraph (H) and inserting ‘‘, and’’, and by adding at 

21 the end the following new subparagraph: 

22 ‘‘(I) wave, current, tidal, and ocean ther23 mal energy.’’ 


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1 (b) DEFINITION OF RESOURCES.—Section 45(c) of 

2 the Internal Revenue Code of 1986 is amended by adding 

3 at the end the following new paragraph: 

4 ‘‘(10) WAVE, CURRENT, TIDAL, AND OCEAN

5 THERMAL ENERGY.—The term ‘wave, current, tidal, 

6 and ocean thermal energy’ means electricity pro7 duced from any of the following: 

8 ‘‘(A) Free flowing ocean water derived 

9 from tidal currents, ocean currents, waves, or 

10 estuary currents. 

11 ‘‘(B) Ocean thermal energy. 

12 ‘‘(C) Free flowing water in rivers, lakes, 

13 man made channels, or streams.’’ 

14 (c) FACILITIES.—Section 45(d) of the Internal Rev15 enue Code of 1986 is amended by adding at the end the 

16 following new paragraph: 

17 ‘‘(11) WAVE, CURRENT, TIDAL, AND OCEAN

18 THERMAL FACILITY.—In the case of a facility using 

19 resources described in subparagraph (A), (B), or (C) 

20 of subsection (c)(10) to produce electricity, the term 

21 ‘qualified facility’ means any facility owned by the 

22 taxpayer which is originally placed in service after 

23 the date of the enactment of this paragraph and be24 fore January 1, 2015, but such term shall not inVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00139 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 clude a facility which includes impoundment struc2 tures or a small irrigation power facility.’’ 

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

4 this section shall apply to taxable years ending after the 

5 date of the enactment of this Act. 

6 SEC. 325. EXTENSION AND EXPANSION OF CREDIT TO 

7 HOLDERS OF CLEAN RENEWABLE ENERGY 

8 BONDS. 

9 (a) IN GENERAL.—Section 54(m) of the Internal 

10 Revenue Code of 1986 (relating to termination) is amend11 ed by striking ‘‘2007’’ and inserting ‘‘2014’’. 

12 (b) ANNUAL VOLUME CAP FOR BONDS ISSUED DUR13 ING EXTENSION PERIOD.—Paragraph (1) of section 54(f) 

14 of the Internal Revenue Code of 1986 (relating to limita15 tion on amount of bonds designated) is amended to read 

16 as follows: 

17 ‘‘(1) NATIONAL LIMITATION.— 

18 ‘‘(A) INITIAL NATIONAL LIMITATION.— 

19 With respect to bonds issued after December 

20 31, 2005, and before January 1, 2008, there is 

21 a national clean renewable energy bond limita22 tion of $800,000,000. 

23 ‘‘(B) ANNUAL NATIONAL LIMITATION.— 

24 With respect to bonds issued after December 

25 31, 2007, and before January 1, 2014, there is 


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1 a national clean renewable energy bond limita2 tion for each calendar year of $800,000,000.’’. 

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

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

5 the enactment of this Act. 

6 SEC. 326. EXTENSION OF CREDIT FOR BUSINESS INSTALLA7 TION OF QUALIFIED FUEL CELLS AND STA8 TIONARY MICROTURBINE POWER PLANTS. 

9 Sections 48(c)(1)(E) and 48(c)(2)(E) of the Internal 

10 Revenue Code of 1986 (relating to termination) are each 

11 amended by striking ‘‘2007’’ and inserting ‘‘2014’’. 

12 SEC. 327. EXTENSION OF BUSINESS SOLAR INVESTMENT 

13 TAX CREDIT. 

14 Sections 48(a)(2)(A)(i)(II) and 48(a)(3)(A)(ii) of the 

15 Internal Revenue Code of 1986 (relating to termination) 

16 are each amended by striking ‘‘2008’’ and inserting 

17 ‘‘2014’’. 

18 SEC. 328. EXTENSION OF FULL CREDIT FOR QUALIFIED 

19 ELECTRIC VEHICLES. 

20 (a) IN GENERAL.—Section 30(e) of the Internal Rev21 enue Code of 1986 is amended by striking ‘‘2006’’ and 

22 inserting ‘‘2015’’. 

23 (b) REPEAL OF PHASEOUT.—Section 30(b) of the In24 ternal Revenue Code of 1986 (relating to limitations) is 


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1 amended by striking paragraph (2) and by redesignating 

2 paragraph (3) as paragraph (2). 

3 (c) CREDIT ALLOWABLE AGAINST ALTERNATIVE

4 MINIMUM TAX.—Paragraph (2) of section 30(b) of the In5 ternal Revenue Code of 1986, as redesignated by sub6 section (b), is amended to read as follows: 

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

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

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

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

11 taxable year plus the tax imposed by section 55, 

12 over 

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

14 under subpart A and section 27.’’. 

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

16 this section shall apply to taxable years beginning after 

17 December 31, 2005. 


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1 Subtitle D—Long-Term Extensions 

2 and Expansions for Energy Effi3 ciency and Conservation Incen4 tives 

5 SEC. 331. EXTENSION OF ENERGY EFFICIENT COMMERCIAL 

6 BUILDINGS DEDUCTION. 

7 Section 179D(h) of the Internal Revenue Code of 

8 1986 (relating to termination) is amended by striking 

9 ‘‘2007’’ and inserting ‘‘2014’’. 

10 SEC. 332. EXTENSION AND EXPANSION OF NEW ENERGY EF11 FICIENT HOME CREDIT. 

12 (a) EXTENSION.—Section 45L(g) of the Internal 

13 Revenue Code of 1986 (relating to termination) is amend14 ed by striking ‘‘2007’’ and inserting ‘‘2014’’. 

15 (b) INCLUSION OF 30 PERCENT HOMES.— 

16 (1) IN GENERAL.—Section 45L(c) of the Inter17 nal Revenue Code of 1986 (relating to energy saving 

18 requirements) is amended— 

19 (A) by striking ‘‘or’’ at the end of para20 graph (2); 

21 (B) by redesignating paragraph (3) as 

22 paragraph (4); and 

23 (C) by inserting after paragraph (2) the 

24 following new paragraph: 

25 ‘‘(3) certified— 


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1 ‘‘(A) to have a level of annual heating and 

2 cooling energy consumption which is at least 30 

3 percent below the annual level described in 

4 paragraph (1), and 

5 ‘‘(B) to have building envelope component 

6 improvements account for at least 1/3 of such 

7 30 percent, or.’’. 

8 (2) APPLICABLE AMOUNT OF CREDIT.—Section 

9 45L(a)(2) is amended by striking ‘‘paragraph (3)’’ 

10 and inserting ‘‘paragraph (3) or (4)’’. 

11 (3) EFFECTIVE DATE.—The amendments made 

12 by this subsection shall apply to qualified new en13 ergy efficient homes acquired after the date of the 

14 enactment of this Act. 

15 SEC. 333. EXTENSION OF NONBUSINESS ENERGY PROP16 ERTY CREDIT. 

17 Section 25C(g) of the Internal Revenue Code of 1986 

18 (relating to termination) is amended by striking ‘‘2007’’ 

19 and inserting ‘‘2014’’. 

20 SEC. 334. EXTENSION AND MODIFICATION OF RESIDENTIAL 

21 ENERGY EFFICIENT PROPERTY CREDIT. 

22 (a) EXTENSION.—Section 25D(g) of the Internal 

23 Revenue Code of 1986 (relating to termination) is amend24 ed by striking ‘‘2007’’ and inserting ‘‘2014’’. 


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1 (b) MODIFICATION OF MAXIMUM CREDIT.—Para2 graph (1) of section 25D(b) of the Internal Revenue Code 

3 of 1986 (relating to limitations) is amended to read as 

4 follows: 

5 ‘‘(1) MAXIMUM CREDIT.—The credit allowed 

6 under subsection (a) for any taxable year shall not 

7 exceed— 

8 ‘‘(A) $1,000 with respect to each half kilo9 watt of capacity of qualified photovoltaic prop10 erty for which qualified photovoltaic property 

11 expenditures are made, 

12 ‘‘(B) $2,000 with respect to any qualified 

13 solar water heating property expenditures, and 

14 ‘‘(C) $500 with respect to each half kilo15 watt of capacity of qualified fuel cell property 

16 (as defined in section 48(c)(1)) for which quali17 fied fuel cell property expenditures are made.’’. 

18 (c) CREDIT ALLOWED AGAINST ALTERNATIVE MIN19 IMUM TAX.— 

20 (1) IN GENERAL.—Section 25D(b) of the Inter21 nal Revenue Code of 1986 (as amended by sub22 section (b)) is amended by adding at the end the fol23 lowing new paragraph: 

24 ‘‘(3) CREDIT ALLOWED AGAINST ALTERNATIVE

25 MINIMUM TAX.—The credit allowed under subsection 


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1 (a) for the taxable year shall not exceed the excess 

2 of— 

3 ‘‘(A) the sum of the regular tax liability 

4 (as defined in section 26(b)) plus the tax im5 posed by section 55, over 

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

7 under subpart A of part IV of subchapter A 

8 and section 27 for the taxable year.’’. 

9 (2) CONFORMING AMENDMENT.—Subsection (c) 

10 of section 25D of such Code is amended to read as 

11 follows: 

12 ‘‘(c) CARRYFORWARD OF UNUSED CREDIT.—If the 

13 credit allowable under subsection (a) for any taxable year 

14 exceeds the limitation imposed by subsection (b)(3) for 

15 such taxable year, such excess shall be carried to the suc16 ceeding taxable year and added to the credit allowable 

17 under subsection (a) for such succeeding taxable year.’’. 

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

19 this section shall apply to taxable years beginning after 

20 December 31, 2005. 

21 SEC. 335. ENERGY CREDIT FOR COMBINED HEAT AND 

22 POWER SYSTEM PROPERTY. 

23 (a) In general.—Section 48(a)(3)(A) of the Internal 

24 Revenue Code of 1986 (defining energy property) is by 

25 striking ‘‘or’’ at the end of clause (iii), by inserting ‘‘or’’ 


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1 at the end of clause (iv), and by adding at the end the 

2 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, 2015. 

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 higher heating value of the primary fuel 

3 sources for 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 ‘‘(4) NONAPPLICATION OF CERTAIN RULES.— 

6 For purposes of determining if the term ‘combined 

7 heat and power system property’ includes tech8 nologies which generate electricity or mechanical 

9 power using back-pressure steam turbines in place of 

10 existing pressure-reducing valves or which make use 

11 of waste heat from industrial processes such as by 

12 using organic rankin, stirling, or kalina heat engine 

13 systems, paragraph (1) shall be applied without re14 gard to subparagraphs (C) and (D) thereof .’’. 

15 (c) EFFECTIVE DATE.—The amendments made by 

16 this section shall apply to periods after December 31, 

17 2005, in taxable years ending after such date, under rules 

18 similar to the rules of section 48(m) of the Internal Rev19 enue Code of 1986 (as in effect on the day before the date 

20 of the enactment of the Revenue Reconciliation Act of 

21 1990). 


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1 SEC. 336. THREE-YEAR APPLICABLE RECOVERY PERIOD 

2 FOR DEPRECIATION OF QUALIFIED ENERGY 

3 MANAGEMENT. 

4 (a) IN GENERAL.—Section 168(e)(3)(A) of the Inter5 nal Revenue Code of 1986 (defining 3-year property) is 

6 amended by striking ‘‘and’’ at the end of clause (ii), by 

7 striking the period at the end of clause (iii) and inserting 

8 ‘‘, and,’’ and by adding at the end the following new 

9 clause: 

10 ‘‘(iv) any qualified energy manage11 ment device.’’. 

12 (b) DEFINITION OF QUALIFIED ENERGY MANAGE13 MENT DEVICE.—Section 168(i) of the Internal Revenue 

14 Code of 1986 (relating to definitions and special rules) 

15 is amended by inserting at the end the following new para16 graph: 

17 ‘‘(18) QUALIFIED ENERGY MANAGEMENT DE18 VICE.— 

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

20 energy management device’ means any energy 

21 management device which is placed in service 

22 before January 1, 2015, by a taxpayer who is 

23 a supplier of electric energy or a provider of 

24 electric energy services. 

25 ‘‘(B) ENERGY MANAGEMENT DEVICE.— 

26 For purposes of subparagraph (A), the term 


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1 ‘energy management device’ means any meter 

2 or metering device which is used by the tax3 payer— 

4 ‘‘(i) to measure and record electricity 

5 usage data on a time-differentiated basis 

6 in at least 4 separate time segments per 

7 day, and 

8 ‘‘(ii) to provide such data on at least 

9 a monthly basis to both consumers and the 

10 taxpayer.’’. 

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

12 this section shall apply to property placed in service after 

13 the date of the enactment of this Act, in taxable years 

14 ending after such date. 

15 SEC. 337. THREE-YEAR APPLICABLE RECOVERY PERIOD 

16 FOR DEPRECIATION OF QUALIFIED WATER 

17 SUBMETERING DEVICES. 

18 (a) IN GENERAL.—Section 168(e)(3)(A) of the Inter19 nal Revenue Code of 1986 (defining 3-year property), as 

20 amended by this Act, is amended by striking ‘‘and’’ at the 

21 end of clause (iii), by striking the period at the end of 

22 clause (iv) and inserting ‘‘, and,’’ and by adding at the 

23 end the following new clause: 

24 ‘‘(v) any qualified water submetering 

25 device.’’. 


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1 (b) DEFINITION OF QUALIFIED WATER SUB2 METERING DEVICE.—Section 168(i) of the Internal Rev3 enue Code of 1986 (relating to definitions and special 

4 rules), as amended by this Act, is amended by inserting 

5 at the end the following new paragraph: 

6 ‘‘(19) QUALIFIED WATER SUBMETERING DE7 VICE.— 

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

9 water submetering device’ means any water 

10 submetering device which is placed in service 

11 before January 1, 2015, by a taxpayer who is 

12 an eligible resupplier with respect to the unit 

13 for which the device is placed in service. 

14 ‘‘(B) WATER SUBMETERING DEVICE.—For 

15 purposes of this paragraph, the term ‘water 

16 submetering device’ means any submetering de17 vice which is used by the taxpayer— 

18 ‘‘(i) to measure and record water 

19 usage data, and 

20 ‘‘(ii) to provide such data on at least 

21 a monthly basis to both consumers and the 

22 taxpayer. 

23 ‘‘(C) ELIGIBLE RESUPPLIER.—For pur24 poses of subparagraph (A), the term ‘eligible re25 supplier’ means any taxpayer who purchases 


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1 and installs qualified water submetering devices 

2 in every unit in any multi-unit property.’’. 

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

4 this section shall apply to property placed in service after 

5 the date of the enactment of this Act, in taxable years 

6 ending after such date. 

7 Subtitle E—Utilizing America’s 

8 Abundant Coal Supplies Cleanly 

9 SEC. 341. CLEAN ENERGY COAL BONDS. 

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

12 1986 is amended by adding at the end the following new 

13 section: 

14 ‘‘SEC. 54A. CREDIT TO HOLDERS OF CLEAN ENERGY COAL 

15 BONDS. 

16 ‘‘(a) ALLOWANCE OF CREDIT.—If a taxpayer holds 

17 a clean energy coal bond on 1 or more credit allowance 

18 dates of the bond occurring during any taxable year, there 

19 shall be allowed as a credit against the tax imposed by 

20 this chapter for the taxable year an amount equal to the 

21 sum of the credits determined under subsection (b) with 

22 respect to such dates. 

23 ‘‘(b) AMOUNT OF CREDIT.— 

24 ‘‘(1) IN GENERAL.—The amount of the credit 

25 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, this subpart and section 

3 1400N(l)). 

4 ‘‘(d) CLEAN ENERGY COAL BOND.—For purposes of 

5 this section— 

6 ‘‘(1) IN GENERAL.—The term ‘clean energy 

7 coal bond’ means any bond issued as part of an 

8 issue if— 

9 ‘‘(A) the bond is issued by a qualified 

10 issuer pursuant to an allocation by the Sec11 retary to such issuer of a portion of the na12 tional clean energy coal bond limitation under 

13 subsection (f)(2), 

14 ‘‘(B) 95 percent or more of the proceeds 

15 from the sale of such issue are to be used for 

16 capital expenditures incurred by qualified bor17 rowers for 1 or more qualified projects, 

18 ‘‘(C) the qualified issuer designates such 

19 bond for purposes of this section and the bond 

20 is in registered form, and 

21 ‘‘(D) the issue meets the requirements of 

22 subsection (h). 

23 ‘‘(2) QUALIFIED PROJECT; SPECIAL USE

24 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 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00158 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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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 with10 out regard to the requirements of subsection (l)(6) 

11 and using as a discount rate the average annual in12 terest rate of tax of tax-exempt obligations having a 

13 term of 10 years or more which are issued during 

14 the month. If the term as so determined is not a 

15 multiple of a whole year, such term shall be rounded 

16 to the next highest whole year. 

17 ‘‘(f) LIMITATION ON AMOUNT OF BONDS DES18 IGNATED.— 

19 ‘‘(1) NATIONAL LIMITATION.—There is a na20 tional clean energy coal bond limitation of 

21 $1,000,000,000. 

22 ‘‘(2) ALLOCATION BY SECRETARY.—The Sec23 retary shall allocate the amount described in para24 graph (1) among qualified projects in such manner 

25 as the Secretary determines appropriate, but shall 


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1 reserve half of the amount allocated to projects de2 signed and operated to capture carbon dioxide emis3 sions and to isolate such emissions permanently 

4 from the atmosphere. 

5 ‘‘(g) CREDIT INCLUDED IN GROSS INCOME.—Gross 

6 income includes the amount of the credit allowed to the 

7 taxpayer under this section (determined without regard to 

8 subsection (c)) and the amount so included shall be treat9 ed as interest income. 

10 ‘‘(h) SPECIAL RULES RELATING TO EXPENDI11 TURES.— 

12 ‘‘(1) IN GENERAL.—An issue shall be treated as 

13 meeting the requirements of this subsection if, as of 

14 the date of issuance, the qualified issuer reasonably 

15 expects— 

16 ‘‘(A) at least 95 percent of the proceeds 

17 from the sale of the issue are to be spent for 

18 1 or more qualified projects within the 5-year 

19 period beginning on the date of issuance of the 

20 clean energy bond, 

21 ‘‘(B) a binding commitment with a third 

22 party to spend at least 10 percent of the pro23 ceeds from the sale of the issue will be incurred 

24 within the 6-month period beginning on the 

25 date of issuance of the clean energy bond or, in 


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1 the case of a clean energy bond the proceeds of 

2 which are to be loaned to 2 or more qualified 

3 borrowers, such binding commitment will be in4 curred within the 6-month period beginning on 

5 the date of the loan of such proceeds to a quali6 fied borrower, and 

7 ‘‘(C) such projects will be completed with 

8 due diligence and the proceeds from the sale of 

9 the issue will be spent with due diligence. 

10 ‘‘(2) EXTENSION OF PERIOD.—Upon submis11 sion of a request prior to the expiration of the period 

12 described in paragraph (1)(A), the Secretary may 

13 extend such period if the qualified issuer establishes 

14 that the failure to satisfy the 5-year requirement is 

15 due to reasonable cause and the related projects will 

16 continue to proceed with due diligence. 

17 ‘‘(3) FAILURE TO SPEND REQUIRED AMOUNT

18 OF BOND PROCEEDS WITHIN 5 YEARS.—To the ex19 tent that less than 95 percent of the proceeds of 

20 such issue are expended by the close of the 5-year 

21 period beginning on the date of issuance (or if an 

22 extension has been obtained under paragraph (2), by 

23 the close of the extended period), the qualified issuer 

24 shall redeem all of the nonqualified bonds within 90 

25 days after the end of such period. For purposes of 


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1 this paragraph, the amount of the nonqualified 

2 bonds required to be redeemed shall be determined 

3 in the same manner as under section 142. 

4 ‘‘(i) SPECIAL RULES RELATING TO ARBITRAGE.—A 

5 bond which is part of an issue shall not be treated as a 

6 clean energy coal bond unless, with respect to the issue 

7 of which the bond is a part, the qualified issuer satisfies 

8 the arbitrage requirements of section 148 with respect to 

9 proceeds of the issue. 

10 ‘‘(j) COOPERATIVE ELECTRIC COMPANY; QUALIFIED

11 ENERGY TAX CREDIT BOND LENDER; GOVERNMENTAL

12 BODY; QUALIFIED BORROWER.—For purposes of this sec13 tion— 

14 ‘‘(1) COOPERATIVE ELECTRIC COMPANY.—The 

15 term ‘cooperative electric company’ means a mutual 

16 or cooperative electric company described in section 

17 501(c)(12) or section 1381(a)(2)(C), or a not-for18 profit electric utility which has received a loan or 

19 loan guarantee under the Rural Electrification Act. 

20 ‘‘(2) CLEAN ENERGY BOND LENDER.—The 

21 term ‘clean energy bond lender’ means a lender 

22 which is a cooperative which is owned by, or has out23 standing loans to, 100 or more cooperative electric 

24 companies and is in existence on February 1, 2002, 


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1 and shall include any affiliated entity which is con2 trolled by such lender. 

3 ‘‘(3) GOVERNMENTAL BODY.—The term ‘gov4 ernmental body’ means any State, territory, posses5 sion of the United States, the District of Columbia, 

6 Indian tribal government, and any political subdivi7 sion. 

8 ‘‘(4) QUALIFIED ISSUER.—The term ‘qualified 

9 issuer’ means— 

10 ‘‘(A) a clean energy bond lender, 

11 ‘‘(B) a cooperative electric company, or 

12 ‘‘(C) a governmental body. 

13 ‘‘(5) QUALIFIED BORROWER.—The term ‘quali14 fied borrower’ means— 

15 ‘‘(A) a mutual or cooperative electric com16 pany described in section 501(c)(12) or 

17 1381(a)(2)(C), or 

18 ‘‘(B) a governmental body. 

19 ‘‘(k) SPECIAL RULES RELATING TO POOL BONDS.— 

20 No portion of a pooled financing bond may be allocable 

21 to any loan unless the borrower has entered into a written 

22 loan commitment for such portion prior to the issue date 

23 of such issue. 

24 ‘‘(l) OTHER DEFINITIONS AND SPECIAL RULES.— 

25 For purposes of this section— 


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1 ‘‘(1) BOND.—The term ‘bond’ includes any ob2 ligation. 

3 ‘‘(2) POOLED FINANCING BOND.—The term 

4 ‘pooled financing bond’ shall have the meaning given 

5 such term by section 149(f)(4)(A). 

6 ‘‘(3) PARTNERSHIP; S CORPORATION; AND

7 OTHER PASS-THRU ENTITIES.— 

8 ‘‘(A) IN GENERAL.—Under regulations 

9 prescribed by the Secretary, in the case of a 

10 partnership, trust, S corporation, or other pass11 thru entity, rules similar to the rules of section 

12 41(g) shall apply with respect to the credit al13 lowable under subsection (a). 

14 ‘‘(B) NO BASIS ADJUSTMENT.—Rules simi15 lar to the rules under section 1397E(i)(2) shall 

16 apply. 

17 ‘‘(4) BONDS HELD BY REGULATED INVEST18 MENT COMPANIES.—If any clean energy coal bond is 

19 held by a regulated investment company, the credit 

20 determined under subsection (a) shall be allowed to 

21 shareholders of such company under procedures pre22 scribed by the Secretary. 

23 ‘‘(5) TREATMENT FOR ESTIMATED TAX PUR24 POSES.—Solely for purposes of sections 6654 and 

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1 payer by reason of holding a clean energy coal bond 

2 on a credit allowance date shall be treated as if it 

3 were a payment of estimated tax made by the tax4 payer on such date. 

5 ‘‘(6) RATABLE PRINCIPAL AMORTIZATION RE6 QUIRED.—A bond shall not be treated as a clean en7 ergy coal bond unless it is part of an issue which 

8 provides for an equal amount of principal to be paid 

9 by the qualified issuer during each calendar year 

10 that the issue is outstanding. 

11 ‘‘(7) REPORTING.—Issuers of clean energy coal 

12 bonds shall submit reports similar to the reports re13 quired under section 149(e). 

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

15 with respect to any bond issued after December 31, 

16 2010.’’. 

17 (b) REPORTING.—Subsection (d) of section 6049 of 

18 the Internal Revenue Code of 1986 (relating to returns 

19 regarding payments of interest) is amended by adding at 

20 the end the following new paragraph: 

21 ‘‘(9) REPORTING OF CREDIT ON CLEAN ENERGY

22 COAL BONDS.— 

23 ‘‘(A) IN GENERAL.—For purposes of sub24 section (a), the term ‘interest’ includes amounts 

25 includible in gross income under section 54A(g) 


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1 and such amounts shall be treated as paid on 

2 the credit allowance date (as defined in section 

3 54A(b)(4)). 

4 ‘‘(B) REPORTING TO CORPORATIONS, 

5 ETC.—Except as otherwise provided in regula6 tions, in the case of any interest described in 

7 subparagraph (A), subsection (b)(4) shall be 

8 applied without regard to subparagraphs (A), 

9 (H), (I), (J), (K), and (L)(i) of such subsection. 

10 ‘‘(C) REGULATORY AUTHORITY.—The Sec11 retary may prescribe such regulations as are 

12 necessary or appropriate to carry out the pur13 poses of this paragraph, including regulations 

14 which require more frequent or more detailed 

15 reporting.’’. 

16 (c) CLERICAL AMENDMENT.—The table of sections 

17 for subpart H of part IV of subchapter A of chapter 1 

18 of the Internal Revenue Code of 1986 is amended by add19 ing at the end the following new item: 

‘‘Sec. 54A. Credit to holders of clean energy coal bonds.’’. 

20 (d) ISSUANCE OF REGULATIONS.—The Secretary of 

21 the Treasury shall issues regulations required under sec22 tion 54A of the Internal Revenue Code of 1986 (as added 

23 by this section) not later than 120 days after the date 

24 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, 2005. 

4 SEC. 342. EXTENSION AND EXPANSION OF QUALIFYING AD5 VANCED COAL PROJECT CREDIT. 

6 (a) EXPANDING AGGREGATE CREDITS.—Section 

7 48A(d)(3)(A) of the Internal Revenue Code of 1986 (relat8 ing to aggregate credits) is amended by striking 

9 ‘‘$1,300,000,000’’ and inserting ‘‘$2,300,000,000’’. 

10 (b) AUTHORIZATION OF ADDITIONAL INTEGRATED

11 GASIFICATION COMBINED CYCLE PROJECTS.—Subpara12 graph (B) of section 48A(d)(3) of the Internal Revenue 

13 Code of 1986 (relating to aggregate credits) is amended 

14 to read as follows: 

15 ‘‘(B) PARTICULAR PROJECTS.—Of the dol16 lar amount in subparagraph (A), the Secretary 

17 is authorized to certify— 

18 ‘‘(i) $800,000,000 for integrated gas19 ification combined cycle projects the appli20 cation for which is submitted during the 

21 period described in paragraph (2)(A)(i), 

22 ‘‘(ii) $500,000,000 for projects which 

23 use other advanced coal-based generation 

24 technologies the application for which is 


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1 submitted during the period described in 

2 paragraph (2)(A)(i), and 

3 ‘‘(iii) $1,000,000,000 for integrated 

4 gasification combined cycle projects the ap5 plication for which is submitted during the 

6 period described in paragraph (2)(A)(ii) 

7 and which are designed and operated to 

8 capture carbon dioxide emissions and iso9 late such emissions permanently from the 

10 atmosphere.’’. 

11 (c) APPLICATION PERIOD FOR ADDITIONAL

12 PROJECTS.—Subparagraph (A) of section 48A(d)(2) of 

13 the Internal Revenue Code of 1986 (relating to certifi14 cation) is amended to read as follows: 

15 ‘‘(A) APPLICATION PERIOD.—Each appli16 cant for certification under this paragraph shall 

17 submit an application meeting the requirements 

18 of subparagraph (B). An applicant may only 

19 submit an application— 

20 ‘‘(i) for an allocation from the dollar 

21 amount specified in clause (i) or (ii) of 

22 paragraph (3)(A) during the 3-year period 

23 beginning on the date the Secretary estab24 lishes the program under paragraph (1), 

25 and 


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1 ‘‘(ii) for an allocation from the dollar 

2 amount specified in paragraph (3)(A)(iii) 

3 during the 3-year period beginning at the 

4 termination of the period described in 

5 clause (i).’’. 

6 (d) MODIFICATION OF QUALIFYING ADVANCED COAL

7 PROJECT CREDIT.—Subparagraph (C) of section 

8 48A(e)(1) of the Internal Revenue Code of 1986 is amend9 ed by inserting ‘‘(300 megawatts in the case of projects 

10 using subbituminous or lignite as a primary feedstock)’’ 

11 after ‘‘400 megawatts’’. 

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

13 this section shall take effect as if included in the amend14 ments made by section 1307 of the Energy Policy Act of 

15 2005. 

16 SEC. 343. EXPANSION OF QUALIFYING GASIFICATION 

17 PROJECT CREDIT. 

18 (a) INCREASING CREDIT LIMIT.—Section 48B(d)(1) 

19 of the Internal Revenue Code of 1986 is amended by strik20 ing ‘‘$350,000,000’’ and inserting ‘‘$1,000,000,000’’. 

21 (b) EXPANSION.—Section 48B(d)(3) of the Internal 

22 Revenue Code of 1986 is amended— 

23 (1) by striking ‘‘and ’’ at the end of subpara24 graph (E), 


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1 (2) by redesignating subparagraph (F) as sub2 paragraph (G), and 

3 (3) by inserting after subparagraph (E) the fol4 lowing new subparagraph: 

5 ‘‘(F) the proposed project is designed and 

6 operated to capture carbon dioxide emissions 

7 and isolate such emissions permanently from 

8 the atmosphere, and’’. 

9 (c) EFFECTIVE DATE.—The amendments made by 

10 this section shall take effect as if included in the amend11 ments made by section 1307 of the Energy Policy Act of 

12 2005. 

13 SEC. 344. COAL-TO-LIQUID AND BIOMASS TRANSPOR14 TATION FUELS. 

15 (a) DEFINITIONS.—In this section: 

16 (1) ADMINISTRATOR.—The term ‘‘Adminis17 trator’’ means the Administrator of the Environ18 mental Protection Agency. 

19 (2) BIOMASS.—The term ‘‘biomass’’ has the 

20 meaning given the term in section 203(b) of the En21 ergy Policy Act of 2005 (42 U.S.C. 15852(b)). 

22 (3) COAL-TO-LIQUID.—The term ‘‘coal-to-liq23 uid’’ means— 

24 (A) with respect to a process or tech25 nology, the use of coal resources of the United 


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1 States to produce a liquid transportation fuel, 

2 including diesel and jet fuels; and 

3 (B) with respect to a facility, the use at 

4 the facility of a process or technology described 

5 in subparagraph (A). 

6 (4) SECRETARY.—The term ‘‘Secretary’’ means 

7 the Secretary of Energy. 

8 (b) RESEARCH PROGRAM.— 

9 (1) IN GENERAL.—The Secretary, in coordina10 tion with the Administrator and the Secretary of 

11 Defense and in consultation with the States, shall 

12 periodically conduct assessments of the costs and 

13 benefits of coal-to-liquid and biomass programs in 

14 the United States, including an analysis of— 

15 (A) technology relating to those programs; 

16 (B) the potential effects of those programs 

17 on— 

18 (i) air and water quality; 

19 (ii) the public health; 

20 (iii) greenhouse gas emissions and the 

21 permanent sequestration of those emis22 sions; and 

23 (iv) the economy; 


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1 (C) levels of investment required to make 

2 commercial coal-to-liquid and biomass produc3 tion economical; and 

4 (D) the national security impacts of var5 ious levels of coal-to-liquid and biomass produc6 tion during the 20-year period beginning on the 

7 date on which the initial assessment is con8 ducted. 

9 (2) REPORTS.—Not later than 1 year after the 

10 date of enactment of this Act, and every 2 years 

11 thereafter, the Secretary shall submit to Congress a 

12 report describing the results of the applicable anal13 ysis under paragraph (1), including recommenda14 tions for the appropriate level of development of 

15 coal-to-liquid and biomass programs, and programs 

16 using any other appropriate resources, to promote a 

17 reduction in greenhouse gas emissions from the 

18 quantity of those emissions that would have occurred 

19 using only petroleum-based fuels. 

20 (3) ADVISORY COMMITTEE.—The Secretary 

21 shall establish an advisory committee to advise the 

22 Secretary in carrying out analyses and reports under 

23 this subsection. 

24 (4) AUTHORIZATION OF APPROPRIATIONS.— 

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1 retary to carry out this subsection $100,000,000, to 

2 remain available until expended. 

3 (c) REFINERY DIVERSIFICATION GRANT PRO4 GRAM.— 

5 (1) ESTABLISHMENT.—Not later than 1 year 

6 after the date on which the initial report under sub7 section (b)(2) is submitted, the Secretary, in con8 sultation with the Administrator, may establish a 

9 program under which the Secretary may provide not 

10 more than 6 competitive grants to support the com11 mercial deployment in the United States of coal-to12 liquid refineries. 

13 (2) ELIGIBLE PROJECTS.—A project shall be el14 igible to receive a grant under this subsection if, as 

15 determined by the Secretary— 

16 (A) the purpose of the project is to deploy 

17 in the United States a coal-to-liquid refinery; 

18 (B) the project supports the diversification 

19 of coal-producing regions and coal ranks 

20 throughout the United States; 

21 (C) the developer of the project would be 

22 financially viable without receiving a grant 

23 under this subsection; 

24 (D) the project site has been identified; 


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1 (E) a preliminary feasibility study of the 

2 project has been completed; 

3 (F) a long-term source of coal has been 

4 identified and secured for the project; and 

5 (G) the refinery that is the subject of the 

6 project will— 

7 (i) have a production capacity of at 

8 least 12,000 barrels per day; and 

9 (ii) be designed and operated to cap10 ture carbon dioxide emissions and perma11 nently isolate those emissions from the at12 mosphere, including by the integration of 

13 enhanced oil recovery or enhanced natural 

14 gas recovery. 

15 (3) USE OF FUNDS.—A grant provided under 

16 this subsection shall be used to pay the costs associ17 ated with deploying in the United States a coal-to18 liquid refinery, including the costs of preliminary en19 gineering and engineering design specifications for 

20 the refinery. 

21 (4) MAXIMUM AMOUNT.—The amount of a 

22 grant provided under this subsection shall not exceed 

23 $50,000,000. 

24 (5) REPORTS.—Not later than 1 year after the 

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1 after until the date on which funds made available 

2 to carry out this subsection are expended, the Sec3 retary shall submit to Congress a report describing 

4 the status of each project that received a grant 

5 under this subsection during the preceding calendar 

6 year. 

7 (6) AUTHORIZATION OF APPROPRIATIONS.— 

8 There is authorized to be appropriated to the Sec9 retary to carry out this subsection $300,000,000, to 

10 remain available until expended. 

11 TITLE IV—REAL GOVERNMENT 

12 LEADERSHIP FOR CLEAN AND 

13 SECURE ENERGY 

14 Subtitle A—Federal Biofuels and 

15 Efficient Vehicle Use Leadership 

16 SEC. 401. FEDERAL AGENCY ETHANOL-BLENDED GASOLINE 

17 AND BIODIESEL PURCHASING REQUIRE18 MENT. 

19 (a) IN GENERAL.—Title III of the Energy Policy Act 

20 of 1992 is amended by striking section 306 (42 U.S.C. 

21 13215) and inserting the following: 


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1 ‘‘SEC. 306. FEDERAL AGENCY ETHANOL-BLENDED GASO2 LINE AND BIODIESEL PURCHASING REQUIRE3 MENT. 

4 ‘‘(a) ETHANOL-BLENDED GASOLINE.—The head of 

5 each Federal agency shall ensure that, in areas in which 

6 ethanol-blended gasoline is reasonably available at a gen7 erally competitive price, the Federal agency purchases eth8 anol-blended gasoline containing at least 10 percent eth9 anol, rather than gasoline that is not ethanol-blended, for 

10 use in vehicles used by the agency that use gasoline. 

11 ‘‘(b) BIODIESEL.— 

12 ‘‘(1) DEFINITION OF BIODIESEL.—In this sub13 section, the term ‘biodiesel’ has the meaning given 

14 the term in section 312(f). 

15 ‘‘(2) REQUIREMENT.—The head of each Fed16 eral agency shall ensure that the Federal agency 

17 purchases, for use in fueling fleet vehicles that use 

18 diesel fuel used by the Federal agency at the loca19 tion at which fleet vehicles of the Federal agency are 

20 centrally fueled, in areas in which the biodiesel21 blended diesel fuel described in subparagraphs (A) 

22 and (B) is available at a generally competitive 

23 price— 

24 ‘‘(A) as of the date that is 5 years after 

25 the date of enactment of this paragraph, bio26 diesel-blended diesel fuel that contains at least 


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1 20 percent biodiesel, rather than diesel fuel that 

2 is not biodiesel-blended; and 

3 ‘‘(B) as of the date that is 10 years after 

4 the date of enactment of this paragraph, bio5 diesel-blended diesel fuel that contains at least 

6 80 percent biodiesel, rather than diesel fuel that 

7 is not biodiesel-blended. 

8 ‘‘(3) REQUIREMENT OF FEDERAL LAW.—This 

9 subsection shall not be considered a requirement of 

10 Federal law for the purposes of section 312. 

11 ‘‘(c) EXEMPTION.—This section does not apply to 

12 fuel used in vehicles excluded from the definition of ‘fleet’ 

13 by subparagraphs (A) through (H) of section 301(9).’’. 

14 SEC. 402. USE OF THE EXISTING FLEXIBLE FUEL VEHICLE 

15 FLEET OF THE FEDERAL GOVERNMENT. 

16 (a) USE OF ALTERNATIVE FUELS BY FLEXIBLE

17 FUEL VEHICLES.—Section 400AA(a)(3) of the Energy 

18 Policy and Conservation Act (42 U.S.C. 6374(a)(3)) is 

19 amended by striking subparagraph (E) and inserting the 

20 following: 

21 ‘‘(E)(i) Flexible fuel vehicles acquired pur22 suant to this section shall be operated on alter23 native fuels unless the Secretary determines 

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1 quirement for vehicles operated by the agency 

2 in a particular geographic area in which— 

3 ‘‘(I) the alternative fuel otherwise re4 quired to be used in the vehicle is not rea5 sonably available to retail purchasers of 

6 the fuel, as certified to the Secretary by 

7 the head of the agency; or 

8 ‘‘(II) the cost of the alternative fuel 

9 otherwise required to be used in the vehicle 

10 is unreasonably more expensive compared 

11 to gasoline, as certified to the Secretary by 

12 the head of the agency. 

13 ‘‘(ii) The Secretary shall monitor compli14 ance with this subparagraph by all agency fleets 

15 and shall submit annually to Congress a report 

16 that— 

17 ‘‘(I) describes the extent to which the 

18 requirements of this subparagraph are 

19 being achieved; and 

20 ‘‘(II) includes information on annual 

21 reductions achieved from the use of petro22 leum-based fuels and the problems, if any, 

23 encountered in acquiring alternative 

24 fuels.’’. 


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1 (b) ALTERNATIVE COMPLIANCE AND FLEXIBILITY.— 

2 The Energy Policy Act of 1992 is amended by striking 

3 section 514 (42 U.S.C. 13263a) and inserting the fol4 lowing: 

5 ‘‘SEC. 514. ALTERNATIVE COMPLIANCE. 

6 ‘‘(a) APPLICATION FOR WAIVER.—Any head of a 

7 Federal agency described in section 303(b)(3), any cov8 ered person subject to section 501, and any State subject 

9 to section 507(o) may petition the Secretary for a waiver 

10 of the applicable requirements of section 303, 501, or 

11 507(o). 

12 ‘‘(b) GRANT OF WAIVER.—The Secretary may grant 

13 a waiver of the requirements of section 303, 501, or 

14 507(o) upon a showing that the fleet owned, operated, 

15 leased, or otherwise controlled by the Federal agency, 

16 State, or covered person— 

17 ‘‘(1) will achieve a reduction in its annual con18 sumption of petroleum fuels equal to— 

19 ‘‘(A) the reduction in consumption of pe20 troleum that would result from 100 percent 

21 compliance with fuel use requirements in sec22 tion 303 or 501, as appropriate; or 

23 ‘‘(B) for entities covered under section 

24 507(o), a reduction equal to the covered entity’s 

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1 native fuel vehicles given credit under section 

2 508 were to use alternative fuel 100 percent of 

3 the time; and 

4 ‘‘(2) is in compliance with all applicable vehicle 

5 emission standards established by the Administrator 

6 under the Clean Air Act (42 U.S.C. 7401 et seq.). 

7 ‘‘(c) REVOCATION OF WAIVER.—The Secretary shall 

8 revoke any waiver granted under this section if the Fed9 eral agency, State, or covered person fails to comply with 

10 subsection (b).’’. 

11 SEC. 403. STANDARDS FOR EXECUTIVE AGENCY AUTO12 MOBILES. 

13 Section 32917 of title 49, United States Code, is 

14 amended to read as follows: 

15 ‘‘§ 32917. Standards for executive agency automobiles 

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

17 ‘‘(1) AUTOMOBILE.—The term ‘automobile’ 

18 does not include any vehicle designed for combat-re19 lated missions, law enforcement work, or emergency 

20 rescue work. 

21 ‘‘(2) EXECUTIVE AGENCY.—The term ‘Execu22 tive agency’ has the meaning given that term in sec23 tion 105 of title 5. 

24 ‘‘(3) NEW AUTOMOBILE.—The term ‘new auto25 mobile’, with respect to the fleet of automobiles of 


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1 an executive agency, means an automobile that is 

2 leased for at least 60 consecutive days or bought, by 

3 or for the Executive agency, after September 30, 

4 2004. 

5 ‘‘(b) BASELINE AVERAGE FUEL ECONOMY.— 

6 ‘‘(1) IN GENERAL.—In accordance with guid7 ance issued under subsection (e), the head of each 

8 Executive agency shall calculate, for all automobiles 

9 in the Executive agency’s fleet of automobiles that 

10 were leased or bought as new vehicles in fiscal year 

11 2004, the average fuel economy for the automobiles. 

12 ‘‘(2) BASELINE.—For purposes of this section, 

13 the average fuel economy as calculated in paragraph 

14 (1) shall be the baseline average fuel economy for 

15 the Executive agency’s fleet of automobiles. 

16 ‘‘(c) INCREASE OF AVERAGE FUEL ECONOMY.—The 

17 head of an Executive agency shall manage the procure18 ment of automobiles for that Executive agency so that not 

19 later than September 30, 2008, the average fuel economy 

20 of the new automobiles in the Executive agency’s fleet of 

21 automobiles is not less than 3 miles per gallon higher than 

22 the baseline average fuel economy determined under sub23 section (b) for that fleet. 


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1 ‘‘(d) FUEL EFFICIENCY.—The head of an Executive 

2 agency shall ensure that each new automobile procured by 

3 the Executive agency is as fuel efficient as practicable. 

4 ‘‘(e) CALCULATION OF AVERAGE FUEL ECONOMY.— 

5 The Secretary of Transportation shall issue guidance to 

6 carry out this section, including guidance for the calcula7 tion of average fuel economy.’’. 

8 SEC. 404. FEDERAL FLEET CONSERVATION REQUIRE9 MENTS. 

10 (a) IN GENERAL.—Part J of title IV of the Energy 

11 Policy and Conservation Act (42 U.S.C. 6374 et seq.) is 

12 amended by adding at the end the following: 

13 ‘‘SEC. 400FF. FEDERAL FLEET CONSERVATION REQUIRE14 MENTS. 

15 ‘‘(a) MANDATORY REDUCTION IN PETROLEUM CON16 SUMPTION.— 

17 ‘‘(1) IN GENERAL.—The Secretary shall issue 

18 regulations for Federal fleets subject to section 

19 400AA requiring that each Federal agency— 

20 ‘‘(A) not later than October 1, 2012, 

21 achieve at least a 20 percent reduction in petro22 leum consumption, as calculated from the base23 line established by the Secretary for fiscal year 

24 1999; and 


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1 ‘‘(B) not later than October 1, 2020, 

2 achieve at least a 40 percent reduction in petro3 leum consumption, as calculated from the base4 line established by the Secretary for fiscal year 

5 1999. 

6 ‘‘(2) PLAN.— 

7 ‘‘(A) REQUIREMENT.—The regulations 

8 shall require each Federal agency to develop a 

9 plan to meet the required petroleum reduction 

10 level. 

11 ‘‘(B) MEASURES.—The plan may allow an 

12 agency to meet the required petroleum reduc13 tion level through— 

14 ‘‘(i) the use of alternative fuels; 

15 ‘‘(ii) the acquisition of vehicles with 

16 higher fuel economy, including hybrid vehi17 cles; 

18 ‘‘(iii) the substitution of cars for light 

19 trucks; 

20 ‘‘(iv) an increase in vehicle load fac21 tors; 

22 ‘‘(v) a decrease in vehicle miles trav23 eled; 

24 ‘‘(vi) a decrease in fleet size; and 

25 ‘‘(vii) other measures. 


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1 ‘‘(C) REPLACEMENT TIRES.—The regula2 tions shall include a requirement that each Fed3 eral agency purchase energy-efficient replace4 ment tires for the respective fleet vehicles of the 

5 agency. 

6 ‘‘(b) FEDERAL EMPLOYEE INCENTIVE PROGRAMS

7 FOR REDUCING PETROLEUM CONSUMPTION.— 

8 ‘‘(1) IN GENERAL.—Each Federal agency shall 

9 actively promote incentive programs that encourage 

10 Federal employees and contractors to reduce petro11 leum through the use of practices such as— 

12 ‘‘(A) telecommuting; 

13 ‘‘(B) public transit; 

14 ‘‘(C) carpooling; and 

15 ‘‘(D) bicycling. 

16 ‘‘(2) MONITORING AND SUPPORT FOR INCEN17 TIVE PROGRAMS.—The Administrator of the General 

18 Services Administration, the Director of the Office 

19 of Personnel Management, and the Secretary of the 

20 Department of Energy shall monitor and provide ap21 propriate support to agency programs described in 

22 paragraph (1).’’. 

23 (b) TABLE OF CONTENTS AMENDMENT.—The table 

24 of contents of the Energy Policy and Conservation Act (42 


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1 U.S.C. prec. 6201) is amended by adding at the end of 

2 the items relating to part J of title III the following: 

‘‘Sec. 400FF. Federal fleet conservation requirements’’ 

3 Subtitle B—Federal Clean and 

4 Efficient Energy Leadership 

5 SEC. 411. FEDERAL LEADERSHIP ON CLEAN ENERGY PUR6 CHASING. 

7 Section 203 of the Energy Policy Act of 2005 (42 

8 U.S.C. 15852) is amended by striking subsection (a) and 

9 inserting the following: 

10 ‘‘(a) REQUIREMENT.—The President, acting through 

11 the Secretary, shall ensure that, of the total quantity of 

12 electric energy the Federal Government consumes during 

13 any fiscal year, the following amounts shall be renewable 

14 energy: 

15 ‘‘(1) Not less than 5 percent in each of fiscal 

16 years 2008 and 2009. 

17 ‘‘(2) Not less than 7.5 percent in each of fiscal 

18 years 2010 through 2012. 

19 ‘‘(3) Not less than 10 percent in fiscal year 

20 2013 and each fiscal year thereafter.’’. 

21 SEC. 412. CLEAN AND SECURE BACKUP POWER AT FED22 ERAL FACILITIES. 

23 Not later than 1 year after the date of enactment 

24 of this Act, the Director of the Office of Management and 

25 Budget, the Secretary of Defense, and the Secretary of 


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1 Homeland Security shall jointly promulgate regulations 

2 establishing requirements applicable to all Federal agency 

3 procurement actions, and to any Federal funds being used, 

4 for the purpose of buying or replacing emergency backup 

5 power or off-grid energy or electricity sources, with a 

6 strong procurement preference for clean emergency 

7 backup power or distributed or off-grid electricity genera8 tion or energy storage units that— 

9 (1) emit no or very low air emissions during use 

10 or the energy storage process, such as— 

11 (A) fuel cells; 

12 (B) integrated solar panels and battery 

13 systems; and 

14 (C) pumped hydroelectric storage; and 

15 (2) to the extent practicable, do not depend pri16 marily on fossil fuel or fossil fuel delivery systems. 

17 SEC. 413. ELIMINATING VAMPIRE ELECTRONIC DEVICES. 

18 (a) DEFINITIONS.—In this section: 

19 (1) AGENCY.— 

20 (A) IN GENERAL.—The term ‘‘Agency’’ 

21 has the meaning given the term ‘‘Executive 

22 agency’’ in section 105 of title 5, United States 

23 Code. 

24 (B) INCLUSIONS.—The term ‘‘Agency’’ in25 cludes military departments, as the term is deVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00187 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 fined in section 102 of title 5, United States 

2 Code. 

3 (2) ELIGIBLE PRODUCT.—The term ‘‘eligible 

4 product’’ means a commercially available, off-the5 shelf product that— 

6 (A)(i) uses external standby power devices; 

7 or 

8 (ii) contains an internal standby power 

9 function; and 

10 (B) is included on the list compiled under 

11 subsection (d). 

12 (b) FEDERAL PURCHASING REQUIREMENT.—Subject 

13 to subsection (c), if an Agency purchases an eligible prod14 uct, the Agency shall purchase— 

15 (1) an eligible product that uses not more than 

16 1 watt in the standby power consuming mode of the 

17 eligible product; or 

18 (2) if an eligible product described in paragraph 

19 (1) is not available, the eligible product with the low20 est available standby power wattage in the standby 

21 power consuming mode of the eligible product. 

22 (c) LIMITATION.—The requirements of subsection (b) 

23 shall apply to a purchase by an Agency only if— 

24 (1) the lower-wattage eligible product is— 

25 (A) lifecycle cost-effective; and 


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1 (B) practicable; and 

2 (2) the utility and performance of the eligible 

3 product is not compromised by the lower wattage re4 quirement. 

5 (d) ELIGIBLE PRODUCTS.— 

6 (1) IN GENERAL.—The Secretary of Energy, in 

7 consultation with the Secretary of Defense and the 

8 Administrator of General Services, shall compile a 

9 list of cost-effective eligible products that shall be 

10 subject to the purchasing requirements of subsection 

11 (b). 

12 (2) ENERGY STAR PROGRAM.—The Adminis13 trator of the Environmental Protection Agency shall 

14 incorporate the list of eligible products into the En15 ergy Star program established by section 324A(a) of 

16 the Energy Policy and Conservation Act (42 U.S.C. 

17 6294a(a)). 

18 SEC. 414. PROMOTING FEDERAL LEADERSHIP IN ENERGY 

19 MANAGEMENT. 

20 (a) IN GENERAL.—Not later than 1 year after the 

21 date of enactment of this Act, the Director of the Office 

22 of Federal Procurement Policy and the Under Secretary 

23 of Defense for Acquisition, Technology, and Logistics 

24 shall, after consultation with private sector voluntary 

25 standard setting organizations focused on increasing enVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00189 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 ergy and environmental performance, jointly promulgate 

2 revisions to the applicable acquisition regulations— 

3 (1) to direct any Federal procurement execu4 tives involved in the acquisition, construction, or 

5 major renovation (including contracting for the con6 struction or major renovation) of any building— 

7 (A) to employ integrated design principles; 

8 (B) to improve site selection for environ9 mental and community benefits; 

10 (C) to protect and conserve water; 

11 (D) to enhance indoor environmental qual12 ity; and 

13 (E) to reduce environmental impacts of 

14 materials and waste flows; 

15 (2) to direct Federal procurement executives in16 volved in leasing buildings, to give preference to the 

17 lease of buildings— 

18 (A) that are energy efficient; and 

19 (B) to which contemporary high perform20 ance and sustainable design principles have 

21 been applied during construction or renovation; 

22 and 

23 (3) that shall be effective on promulgation of 

24 the regulations. 


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1 (b) GUIDANCE.—Not later than 90 days after pro2 mulgation of the regulations under subsection (a), the Di3 rector and the Under Secretary shall issue guidance to 

4 each Federal procurement executive providing direction 

5 and instructions to renegotiate existing buildings and fa6 cilities leases to obtain improvements in accordance with 

7 this section. 

8 SEC. 415. RETENTION OF SAVINGS FROM ENERGY SAVINGS 

9 PERFORMANCE CONTRACTS. 

10 (a) RETENTION OF SAVINGS.—Section 546(c) of the 

11 National Energy Conservation Policy Act (42 U.S.C. 

12 8256(c)) is amended by striking paragraph (5). 

13 (b) FINANCING FLEXIBILITY.—Section 801(a)(2) of 

14 the National Energy Conservation Policy Act (42 U.S.C. 

15 8287(a)(2)) is amended by adding at the end the fol16 lowing: 

17 ‘‘(E) SEPARATE CONTRACTS.—In carrying 

18 out a contract under this title, a Federal agency 

19 may— 

20 ‘‘(i) enter into a separate contract for 

21 energy services and conservation measures 

22 under the contract; and 

23 ‘‘(ii) provide all or part of the financ24 ing necessary to carry out the contract.’’. 


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1 (c) DEFINITION OF ENERGY SAVINGS.—Section 

2 804(2) of the National Energy Conservation Policy Act 

3 (42 U.S.C. 8287c(2)) is amended— 

4 (1) by redesignating subparagraphs (A), (B), 

5 and (C) as clauses (i), (ii), and (iii), respectively, 

6 and indenting appropriately; 

7 (2) by striking ‘‘means a reduction’’ and insert8 ing ‘‘means’’— 

9 ‘‘(A) a reduction’’; 

10 (3) by striking the period at the end and insert11 ing a semicolon; and 

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

13 ‘‘(B) the increased efficient use of an exist14 ing energy source by cogeneration or heat re15 covery and installation of renewable energy sys16 tems; 

17 ‘‘(C) the sale or transfer of electrical or 

18 thermal energy generated on-site, but in excess 

19 of Federal needs, to utilities or non-Federal en20 ergy users; and 

21 ‘‘(D) the increased efficient use of existing 

22 water sources in interior or exterior applica23 tions.’’. 

24 (d) ENERGY AND COST SAVINGS IN NONBUILDING

25 APPLICATIONS.— 


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1 (1) DEFINITIONS.—In this subsection: 

2 (A) NONBUILDING APPLICATION.—The 

3 term ‘‘nonbuilding application’’ means— 

4 (i) any class of vehicles, devices, or 

5 equipment that is transportable under the 

6 power of the applicable vehicle, device, or 

7 equipment by land, sea, or air and that 

8 consumes energy from any fuel source for 

9 the purpose of— 

10 (I) that transportation; or 

11 (II) maintaining a controlled en12 vironment within the vehicle, device, 

13 or equipment; and 

14 (ii) any federally-owned equipment 

15 used to generate electricity or transport 

16 water. 

17 (B) SECONDARY SAVINGS.— 

18 (i) IN GENERAL.—The term ‘‘sec19 ondary savings’’ means additional energy 

20 or cost savings that are a direct con21 sequence of the energy savings that result 

22 from the energy efficiency improvements 

23 that were financed and implemented pur24 suant to an energy savings performance 

25 contract (as defined in section 423(a)). 


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1 (ii) INCLUSIONS.—The term ‘‘sec2 ondary savings’’ includes— 

3 (I) energy and cost savings that 

4 result from a reduction in the need 

5 for fuel delivery and logistical support; 

6 (II) personnel cost savings and 

7 environmental benefits; and 

8 (III) in the case of electric gen9 eration equipment, the benefits of in10 creased efficiency in the production of 

11 electricity, including revenues received 

12 by the Federal Government from the 

13 sale of electricity produced. 

14 (C) SECRETARY.—The term ‘‘Secretary’’ 

15 means the Secretary of Energy. 

16 (2) STUDY.— 

17 (A) IN GENERAL.—As soon as practicable 

18 after the date of enactment of this Act, the Sec19 retary and the Secretary of Defense shall joint20 ly conduct a study of the potential for the use 

21 of energy savings performance contracts to re22 duce energy consumption and provide energy 

23 and cost savings in nonbuilding applications. 

24 (B) REQUIREMENTS.—The study under 

25 this subsection shall include— 


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1 (i) an estimate of the potential energy 

2 and cost savings to the Federal Govern3 ment, including secondary savings and 

4 benefits, from increased efficiency in non5 building applications; 

6 (ii) an assessment of the feasibility of 

7 extending the use of energy savings per8 formance contracts to nonbuilding applica9 tions, including an identification of any 

10 regulatory or statutory barriers to such 

11 use; and 

12 (iii) such recommendations as the 

13 Secretary and the Secretary of Defense de14 termine to be appropriate. 

15 (3) REPORT.—On completion of the study 

16 under paragraph (2), the Secretary and the Sec17 retary of Defense shall submit to the President and 

18 the appropriate committees of Congress a report 

19 that describes— 

20 (A) the results of the study; and 


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1 Subtitle C—State, Tribal, and Local 

2 Clean and Efficient Energy 

3 Leadership 

4 SEC. 421. FREEDOM FROM FOSSIL FUELS (F4) BONDS. 

5 (a) IN GENERAL.—Subpart H of part IV of sub6 chapter A of chapter 1 of the Internal Revenue Code of 

7 1986 (relating to credits against tax), as amended by this 

8 Act, is amended by adding at the end the following new 

9 section: 

10 ‘‘SEC. 54B. CREDIT TO HOLDERS OF FREEDOM FROM FOS11 SIL FUELS (F4) BONDS. 

12 ‘‘(a) ALLOWANCE OF CREDIT.—If a taxpayer holds 

13 a Freedom from Fossil Fuels (F4) bond on 1 or more 

14 credit allowance dates of the bond occurring during any 

15 taxable year, there shall be allowed as a credit against the 

16 tax imposed by this chapter for the taxable year an 

17 amount equal to the sum of the credits determined under 

18 subsection (b) with respect to such dates. 

19 ‘‘(b) AMOUNT OF CREDIT.— 

20 ‘‘(1) IN GENERAL.—The amount of the credit 

21 determined under this subsection with respect to any 

22 credit allowance date for a Freedom from Fossil 

23 Fuels (F4) bond is 25 percent of the annual credit 

24 determined with respect to such bond. 


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1 ‘‘(2) ANNUAL CREDIT.—The annual credit de2 termined with respect to any Freedom from Fossil 

3 Fuels (F4) bond is the product of— 

4 ‘‘(A) the credit rate determined by the Sec5 retary under paragraph (3) for the day on 

6 which such bond was sold, multiplied by 

7 ‘‘(B) the outstanding face amount of the 

8 bond. 

9 ‘‘(3) DETERMINATION.—For purposes of para10 graph (2), with respect to any Freedom from Fossil 

11 Fuels (F4) bond, the Secretary shall determine daily 

12 or cause to be determined daily a credit rate which 

13 shall apply to the first day on which there is a bind14 ing, written contract for the sale or exchange of the 

15 bond. The credit rate for any day is the credit rate 

16 which the Secretary or the Secretary’s designee esti17 mates will permit the issuance of Freedom from 

18 Fossil Fuels (F4) bonds with a specified maturity or 

19 redemption date without discount and without inter20 est cost to the issuing governmental body. 

21 ‘‘(4) CREDIT ALLOWANCE DATE.—For purposes 

22 of this section, the term ‘credit allowance date’ 

23 means— 

24 ‘‘(A) March 15, 

25 ‘‘(B) June 15, 


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1 ‘‘(C) September 15, and 

2 ‘‘(D) December 15. 

3 Such term also includes the last day on which the 

4 bond is outstanding. 

5 ‘‘(5) SPECIAL RULE FOR ISSUANCE AND RE6 DEMPTION.—In the case of a bond which is issued 

7 during the 3-month period ending on a credit allow8 ance date, the amount of the credit determined 

9 under this subsection with respect to such credit al10 lowance date shall be a ratable portion of the credit 

11 otherwise determined based on the portion of the 3- 

12 month period during which the bond is outstanding. 

13 A similar rule shall apply when the bond is redeemed 

14 or matures. 

15 ‘‘(c) LIMITATION BASED ON AMOUNT OF TAX.— 

16 ‘‘(1) IN GENERAL.—The credit allowed under 

17 subsection (a) for any taxable year shall not exceed 

18 the excess of— 

19 ‘‘(A) the sum of the regular tax liability 

20 (as defined in section 26(b)) plus the tax im21 posed by section 55, over 

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

23 under this part (other than subpart C, section 

24 1400N(l), and this subpart). 


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1 ‘‘(2) CARRYFORWARD OF UNUSED CREDIT.—If 

2 the credit allowable under subsection (a) exceeds the 

3 limitation imposed by paragraph (1) for such taxable 

4 year, such excess shall be carried to each of the 5 

5 taxable years following the unused credit year and 

6 added to the credit allowable under subsection (a) 

7 for each such taxable year, subject to the application 

8 of paragraph (1) to such taxable year. 

9 ‘‘(d) FREEDOM FROM FOSSIL FUELS (F4) BOND.— 

10 For purposes of this section— 

11 ‘‘(1) IN GENERAL.—The term ‘Freedom from 

12 Fossil Fuels (F4) bond’ means any bond issued as 

13 part of an issue if— 

14 ‘‘(A) the bond is issued by a governmental 

15 body pursuant to an allocation by the Freedom 

16 from Fossil Fuels (F4) Bonds Board to such 

17 issuer of a portion of the Freedom from Fossil 

18 Fuels (F4) bond limitation under subsection 

19 (f)(2), 

20 ‘‘(B) 95 percent or more of the proceeds 

21 from the sale of such issue are to be used for 

22 capital expenditures incurred for 1 or more 

23 qualified fossil fuel use reduction projects, 


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1 ‘‘(C) the issuer designates such bond for 

2 purposes of this section and the bond is in reg3 istered form, 

4 ‘‘(D) such bond satisfies public approval 

5 requirements similar to the requirements of sec6 tion 147(f)(2), 

7 ‘‘(E) except as provided in paragraph 

8 (4)(B), the payment of the principal of such 

9 issue is secured by taxes of general applicability 

10 imposed by a general purpose governmental 

11 unit, and 

12 ‘‘(F) the issue meets the requirements of 

13 subsection (h). 

14 ‘‘(2) QUALIFIED FOSSIL FUEL USE REDUCTION

15 PROJECT.— 

16 ‘‘(A) IN GENERAL.—The term ‘a qualified 

17 fossil fuel use reduction project’ means any 

18 project that will reduce oil and fossil fuel con19 sumption, including— 

20 ‘‘(i) transit oriented development, 

21 ‘‘(ii) public transit infrastructure, 

22 ‘‘(iii) alternative fuels vehicles and in23 frastructure, 

24 ‘‘(iv) nonpetroleum vehicle manufac25 turing facilities, 


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1 ‘‘(v) energy efficiency and energy de2 mand reduction, 

3 ‘‘(vi) greenhouse gas reduction pro4 grams and systems, and 

5 ‘‘(vii) telecommuting programs. 

6 ‘‘(B) QUALIFIED PROPERTY.—The term 

7 ‘qualified property’ means real property— 

8 ‘‘(i) which is, or is to be, owned by— 

9 ‘‘(I) a governmental body, or 

10 ‘‘(II) an organization described 

11 in section 501(c)(3) and exempt from 

12 taxation under section 501(a) and 

13 which has as one if its purposes envi14 ronmental preservation, and 

15 ‘‘(ii) which is reasonably anticipated 

16 to be available for use by members of the 

17 general public, unless such use would 

18 change the character of the property and 

19 be contrary to the qualified use of the 

20 property. 

21 ‘‘(C) SAFE HARBOR FOR MANAGEMENT

22 CONTRACTS.—For purposes of subparagraph 

23 (B), property shall not be treated as qualified 

24 property if any rights or benefits of such prop25 erty inure to a private person other than rights 


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1 or benefits under a management contract or 

2 similar type of operating agreement to which 

3 rules similar to the rules applicable to tax-ex4 empt bonds apply. 

5 ‘‘(D) LIMIT ON DISPOSITION OF PROP6 ERTY.—Any disposition of any interest in prop7 erty acquired or improved in connection with a 

8 qualified fossil fuel use reduction project de9 scribed in this paragraph (except a project de10 scribed in subparagraph (A)(v)) shall contain 

11 an option (recorded pursuant to applicable 

12 State or local law) to purchase such property 

13 for an amount equal to the original acquisition 

14 price of such property for any interested organi15 zations described in subparagraph (B)(i)(II) if 

16 such organization purchases such property sub17 ject to a restrictive covenant requiring a contin18 ued qualified use of such property. 

19 ‘‘(E) QUALIFIED USE.—The term ‘quali20 fied use’ means, with respect to property, a use 

21 which is consistent with the purpose of the 

22 qualified fossil fuel use reduction project related 

23 to such property. 

24 ‘‘(3) SPECIAL USE RULES.— 


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1 ‘‘(A) REFINANCING RULES.—For purposes 

2 of paragraph (1)(B), a qualified fossil fuel use 

3 reduction project may be refinanced with pro4 ceeds of a Freedom from Fossil Fuels (F4) 

5 bond only if the indebtedness being refinanced 

6 (including any obligation directly or indirectly 

7 refinanced by such indebtedness) was originally 

8 incurred by the borrower after the date of the 

9 enactment of this section. 

10 ‘‘(B) REIMBURSEMENT.—For purposes of 

11 paragraph (1)(B), a Freedom from Fossil Fuels 

12 (F4) bond may be issued to reimburse a bor13 rower for amounts paid after the date of the en14 actment of this section with respect to a quali15 fied fossil fuel use reduction project, but only 

16 if— 

17 ‘‘(i) prior to the payment of the origi18 nal expenditure, the borrower declared its 

19 intent to reimburse such expenditure with 

20 the proceeds of a Freedom from Fossil 

21 Fuels (F4) bond, 

22 ‘‘(ii) not later than 60 days after pay23 ment of the original expenditure, the issuer 

24 adopts an official intent to reimburse the 


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1 original expenditure with such proceeds, 

2 and 

3 ‘‘(iii) the reimbursement is made not 

4 later than 18 months after the date the 

5 original expenditure is paid. 

6 ‘‘(C) TREATMENT OF CHANGES IN USE.— 

7 For purposes of paragraph (1)(B), the proceeds 

8 of an issue shall not be treated as used for a 

9 qualified fossil fuel use reduction project to the 

10 extent that a borrower takes any action within 

11 its control which causes such proceeds not to be 

12 used for a qualified fossil fuel use reduction 

13 project. The Secretary shall prescribe regula14 tions specifying remedial actions that may be 

15 taken (including conditions to taking such re16 medial actions) to prevent an action described 

17 in the preceding sentence from causing a bond 

18 to fail to be a Freedom from Fossil Fuels (F4) 

19 bond. 

20 ‘‘(4) SPECIAL RULES FOR PROJECTS DE21 SCRIBED IN PARAGRAPH (2)(A)(V).— 

22 ‘‘(A) LIMIT ON USE OF PROCEEDS FOR

23 PROJECT.—This subsection shall not apply to 

24 any bond issued as part of an issue if an 

25 amount of the proceeds from such issue are 


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1 used for a qualified fossil fuel use reduction 

2 project described in paragraph (2)(A)(v) and in3 volving public infrastructure in excess of an 

4 amount equal to 5 percent of the total amount 

5 of such proceeds used for all projects described 

6 in such paragraph (2)(A)(v). 

7 ‘‘(B) PRIVATE USE AND REPAYMENT OF

8 PROCEEDS.—In the case of proceeds of an issue 

9 which are used for a qualified fossil fuel use re10 duction project described in paragraph 

11 (2)(A)(v), the issue of which such bonds are a 

12 part shall not fail to meet the requirements of 

13 this subsection solely because the proceeds of a 

14 disposition of any interest in such property are 

15 used to redeem such bonds as long as the pur16 chaser of such property makes an irrevocable 

17 election not to claim any deduction with respect 

18 to such project under section 198. 

19 ‘‘(e) MATURITY LIMITATIONS.— 

20 ‘‘(1) DURATION OF TERM.—A bond shall not be 

21 treated as a Freedom from Fossil Fuels (F4) bond 

22 if the maturity of such bond exceeds the maximum 

23 term determined by the Secretary under paragraph 

24 (2) with respect 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 with10 out regard to the requirements of subsection (l)(6) 

11 and using as a discount rate the average annual in12 terest rate of tax of tax-exempt obligations having a 

13 term of 10 years or more which are issued during 

14 the month. If the term as so determined is not a 

15 multiple of a whole year, such term shall be rounded 

16 to the next highest whole year. 

17 ‘‘(f) LIMITATION ON AMOUNT OF BONDS DES18 IGNATED.— 

19 ‘‘(1) IN GENERAL.—There is a Freedom from 

20 Fossil Fuels (F4) bond limitation for each calendar 

21 year equal to— 

22 ‘‘(A) $3,000,000,000 for each of years 

23 2007 through 2014, and 

24 ‘‘(B) except as provided in paragraph (3), 

25 zero after 2014. 


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1 ‘‘(2) ALLOCATION OF LIMITATION AMONG GOV2 ERNMENTAL BODIES.— 

3 ‘‘(A) IN GENERAL.—The limitation amount 

4 to be allocated under paragraph (1) for any cal5 endar year shall be allocated among govern6 mental bodies with an approved application on 

7 a competitive basis by the Freedom from Fossil 

8 Fuels (F4) Bonds Board (referred to in this 

9 subsection as the ‘Board’) established under 

10 section 161 of the Clean Energy Development 

11 for a Growing Economy Act of 2006. 

12 ‘‘(B) APPROVED APPLICATION.—For pur13 poses of subparagraph (A), the term ‘approved 

14 application’ means an application which is ap15 proved by the Board, and which includes such 

16 information as the Board requires. 

17 ‘‘(C) ALLOCATION TO EACH GOVERN18 MENTAL BODY.—The Board shall, in accord19 ance with the criteria for approval of applica20 tions, allocate amounts in any calendar year to 

21 at least 1 approved application from each gov22 ernmental body which submits such application. 

23 ‘‘(3) CARRYOVER OF UNUSED LIMITATION.—If 

24 for any calendar year— 


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1 ‘‘(A) the limitation amount under para2 graph (1), exceeds 

3 ‘‘(B) the aggregate limitation amount allo4 cated to governmental bodies under this section, 

5 the limitation amount under paragraph (1) for the 

6 following calendar year shall be increased by the 

7 amount of such excess. No limitation amount shall 

8 be carried forward under this paragraph more than 

9 3 years. 

10 ‘‘(g) CREDIT INCLUDED IN GROSS INCOME.—Gross 

11 income includes the amount of the credit allowed to the 

12 taxpayer under this section (determined without regard to 

13 subsection (c)) and the amount so included shall be treat14 ed as interest income. 

15 ‘‘(h) SPECIAL RULES RELATING TO EXPENDI16 TURES.— 

17 ‘‘(1) IN GENERAL.—An issue shall be treated as 

18 meeting the requirements of this subsection if, as of 

19 the date of issuance, the issuer reasonably expects— 

20 ‘‘(A) at least 95 percent of the proceeds 

21 from the sale of the issue are to be spent for 

22 1 or more qualified fossil fuel use reduction 

23 projects within the 5-year period beginning on 

24 the date of issuance of the Freedom from Fossil 

25 Fuels (F4) bond, 


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1 ‘‘(B) a binding commitment with a third 

2 party to spend at least 10 percent of the pro3 ceeds from the sale of the issue will be incurred 

4 within the 6-month period beginning on the 

5 date of issuance of the Freedom from Fossil 

6 Fuels (F4) bond or, in the case of a Freedom 

7 from Fossil Fuels (F4) bond the proceeds of 

8 which are to be loaned to 2 or more borrowers, 

9 such binding commitment will be incurred with10 in the 6-month period beginning on the date of 

11 the loan of such proceeds to a borrower, and 

12 ‘‘(C) such projects will be completed with 

13 due diligence and the proceeds from the sale of 

14 the issue will be spent with due diligence. 

15 ‘‘(2) EXTENSION OF PERIOD.—Upon submis16 sion of a request prior to the expiration of the period 

17 described in paragraph (1)(A), the Secretary may 

18 extend such period if the issuer establishes that the 

19 failure to satisfy the 5-year requirement is due to 

20 reasonable cause and the related projects will con21 tinue to proceed with due diligence. 

22 ‘‘(3) FAILURE TO SPEND REQUIRED AMOUNT

23 OF BOND PROCEEDS WITHIN 5 YEARS.—To the ex24 tent that less than 95 percent of the proceeds of 

25 such issue are expended by the close of the 5-year 


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•S 2829 IS

1 period beginning on the date of issuance (or if an 

2 extension has been obtained under paragraph (2), by 

3 the close of the extended period), the issuer shall re4 deem all of the nonqualified bonds within 90 days 

5 after the end of such period. For purposes of this 

6 paragraph, the amount of the nonqualified bonds re7 quired to be redeemed shall be determined in the 

8 same manner as under section 142. 

9 ‘‘(i) SPECIAL RULES RELATING TO ARBITRAGE.—A 

10 bond which is part of an issue shall not be treated as a 

11 Freedom from Fossil Fuels (F4) bond unless, with respect 

12 to the issue of which the bond is a part, the issuer satisfies 

13 the arbitrage requirements of section 148 with respect to 

14 proceeds of the issue. 

15 ‘‘(j) GOVERNMENTAL BODY.—For purposes of this 

16 section, the term ‘governmental body’ means any State, 

17 territory, possession of the United States, the District of 

18 Columbia, Indian tribal government, and any political sub19 division. 

20 ‘‘(k) SPECIAL RULES RELATING TO POOL BONDS.— 

21 No portion of a pooled financing bond may be allocable 

22 to any loan unless the borrower has entered into a written 

23 loan commitment for such portion prior to the issue date 

24 of such issue. 


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1 ‘‘(l) OTHER DEFINITIONS AND SPECIAL RULES.— 

2 For purposes of this section— 

3 ‘‘(1) BOND.—The term ‘bond’ includes any ob4 ligation. 

5 ‘‘(2) POOLED FINANCING BOND.—The term 

6 ‘pooled financing bond’ shall have the meaning given 

7 such term by section 149(f)(4)(A). 

8 ‘‘(3) PARTNERSHIP; S CORPORATION; AND

9 OTHER PASS-THRU ENTITIES.— 

10 ‘‘(A) IN GENERAL.—Under regulations 

11 prescribed by the Secretary, in the case of a 

12 partnership, trust, S corporation, or other pass13 thru entity, rules similar to the rules of section 

14 41(g) shall apply with respect to the credit al15 lowable under subsection (a). 

16 ‘‘(B) NO BASIS ADJUSTMENT.—Rules simi17 lar to the rules under section 1397E(i)(2) shall 

18 apply. 

19 ‘‘(4) BONDS HELD BY REGULATED INVEST20 MENT COMPANIES.—If any Freedom from Fossil 

21 Fuels (F4) bond is held by a regulated investment 

22 company, the credit determined under subsection (a) 

23 shall be allowed to shareholders of such company 

24 under procedures prescribed by the Secretary. 


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•S 2829 IS

1 ‘‘(5) TREATMENT FOR ESTIMATED TAX PUR2 POSES.—Solely for purposes of sections 6654 and 

3 6655, the credit allowed by this section to a tax4 payer by reason of holding a Freedom from Fossil 

5 Fuels (F4) bond on a credit allowance date shall be 

6 treated as if it were a payment of estimated tax 

7 made by the taxpayer on such date. 

8 ‘‘(6) RATABLE PRINCIPAL AMORTIZATION RE9 QUIRED.—A bond shall not be treated as a Freedom 

10 from Fossil Fuels (F4) bond unless it is part of an 

11 issue which provides for an equal amount of prin12 cipal to be paid by the issuer during each calendar 

13 year that the issue is outstanding. 

14 ‘‘(7) REPORTING.—Issuers of Freedom from 

15 Fossil Fuels (F4) bonds shall submit reports similar 

16 to the reports required under section 149(e). 

17 ‘‘(8) CREDITS MAY BE STRIPPED.—Under regu18 lations prescribed by the Secretary— 

19 ‘‘(A) IN GENERAL.—There may be a sepa20 ration (including at issuance) of the ownership 

21 of a Freedom from Fossil Fuels (F4) bond and 

22 the entitlement to the credit under this section 

23 with respect to such bond. In case of any such 

24 separation, the credit under this section shall be 

25 allowed to the person which, on the credit alVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00212 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 lowance date, holds the instrument evidencing 

2 the entitlement to the credit and not to the 

3 holder of the bond. 

4 ‘‘(B) CERTAIN RULES TO APPLY.—In the 

5 case of a separation described in subparagraph 

6 (A), the rules of section 1286 shall apply to the 

7 Freedom from Fossil Fuels (F4) bond as if it 

8 were a stripped bond and to the credit under 

9 this section as if it were a stripped coupon. 

10 ‘‘(9) CREDIT MAY BE TRANSFERRED.—Nothing 

11 in any law or rule of law shall be construed to limit 

12 the transferability of the credit allowed by this sec13 tion through sale and repurchase agreements. 

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

15 with respect to any bond issued after December 31, 

16 2014.’’ 

17 (b) REPORTING.—Subsection (d) of section 6049 of 

18 the Internal Revenue Code of 1986 (relating to returns 

19 regarding payments of interest), as amended by this Act, 

20 is amended by adding at the end the following: 

21 ‘‘(10) REPORTING OF CREDIT ON FREEDOM

22 FROM FOSSIL FUELS (F4) BONDS.— 

23 ‘‘(A) IN GENERAL.—For purposes of sub24 section (a), the term ‘interest’ includes amounts 

25 includible in gross income under section 54B(g) 


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1 and such amounts shall be treated as paid on 

2 the credit allowance date (as defined in section 

3 54B(b)(4)). 

4 ‘‘(B) REPORTING TO CORPORATIONS, 

5 ETC.—Except as otherwise provided in regula6 tions, in the case of any interest described in 

7 subparagraph (A) of this paragraph, subsection 

8 (b)(4) of this section shall be applied without 

9 regard to subparagraphs (A), (H), (I), (J), (K), 

10 and (L)(i). 

11 ‘‘(C) REGULATORY AUTHORITY.—The Sec12 retary may prescribe such regulations as are 

13 necessary or appropriate to carry out the pur14 poses of this paragraph, including regulations 

15 which require more frequent or more detailed 

16 reporting.’’. 

17 (c) CLERICAL AMENDMENT.—The table of sections 

18 for subpart H of part IV of subchapter A of chapter 1 

19 of the Internal Revenue Code of 1986, as amended by this 

20 Act, is amended by adding at the end the following: 

‘‘Sec. 54B. Credit to holders of freedom from fossil Fuels (F4) bonds.’’. 

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

22 this section shall apply to bonds issued after December 

23 31, 2005. 

24 (e) FREEDOM FROM FOSSIL FUELS (F4) BONDS

25 BOARD.— 


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1 (1) IN GENERAL.—The President, in consulta2 tion with Congress, States, and local communities, 

3 shall establish in the Executive Branch the Freedom 

4 from Fossil Fuels (F4) Bonds Board (referred to in 

5 this subsection as the ‘‘Board’’) to review applica6 tions for allocation of the Freedom from Fossil 

7 Fuels (F4) bond applications in accordance with cri8 teria published in the Federal Register. 

9 (2) ANNUAL REPORT.—The Board shall annu10 ally report with respect to the conduct of its respon11 sibilities under this subsection to the President and 

12 Congress and such report shall include— 

13 (A) the overall progress of the Freedom 

14 from Fossil Fuels (F4) bond program, and 

15 (B) the overall limitation amount allocated 

16 during the year and a description of the 

17 amount, region, and qualified fossil fuel use re18 duction project financed by each allocation. 

19 (3) AUTHORIZATION OF APPROPRIATIONS.— 

20 There are authorized to be appropriated to the 

21 Board such sums as are necessary to carry out the 

22 purposes of this subsection. 

23 SEC. 422. CLEAN ENERGY SECURITY COLLABORATIVE. 

24 (a) IN GENERAL.—There is established a cooperative 

25 program, to be known as the ‘‘Clean Energy Security ColVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00215 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 laborative’’ (referred to in this section as the ‘‘Collabo2 rative’’)— 

3 (1) to promote awareness of and increased use 

4 of clean energy technologies for energy security; and 

5 (2) to increase collaboration among Federal and 

6 State agencies to deploy clean distributed energy 

7 technologies and systems for critical facilities, infra8 structure, and homeland security applications. 

9 (b) ADMINISTRATION.—The Collaborative shall be 

10 carried out by the Secretary of Energy— 

11 (1) in accordance with an agreement between 

12 the Secretary and a nonprofit, non-governmental or13 ganization that represents various types of State 

14 clean energy funds dedicated to promoting the devel15 opment and deployment of clean energy technologies 

16 and to creating and expanding the markets for the 

17 technologies; and 

18 (2) in consultation with the States. 

19 (c) DUTIES.—The Collaborative, through the leader20 ship of State clean energy funds, and in partnership with 

21 institutions of higher education, shall conduct a multistate 

22 analysis to develop— 

23 (1) a model energy security assessment tem24 plate for critical facilities and infrastructure; 


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1 (2) a business case that explores a strategy for 

2 using clean distributed generation technologies at 

3 critical facilities and infrastructure, including— 

4 (A) building and facility backup power; 

5 (B) emergency response capability; 

6 (C) low-power protection; 

7 (D) infrastructure area support; 

8 (E) transportation; and 

9 (F) telecommunications; 

10 (3) a feasibility study initiative with— 

11 (A) a short list of critical facilities and in12 frastructure for potential demonstration 

13 projects; 

14 (B) a template for the feasibility studies to 

15 be carried out; and 

16 (C) a plan to conduct feasibility studies in 

17 select States to better understand the actual 

18 economic, technical, and other market barriers 

19 to the use of clean distributed generation tech20 nologies at critical public facilities and infra21 structure; 

22 (4) a generic financial and engineering model 

23 based on the results of the feasibility studies carried 

24 out under paragraph (3) that could be used to accel25 erate consideration and adoption of clean energy sysVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00217 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 tems at critical public facilities and infrastructure; 

2 and 

3 (5) a report for submission to Congress to 

4 present findings and strategic recommendations for 

5 improving energy security at critical facilities and in6 frastructure using clean distributed generation tech7 nologies through a Federal-State partnership. 

8 (d) FEDERAL-STATE PILOT PROJECTS.—The Col9 laborative shall establish Federal-State pilot projects with 

10 demonstrations in 5 States— 

11 (1) to implement recommendations from the 

12 feasibility studies carried out under subsection 

13 (c)(3); 

14 (2) to facilitate the use of local, distributed, 

15 clean energy generation technologies and systems at 

16 critical public safety facilities and infrastructure; 

17 and 

18 (3) as overall purposes, to fortify infrastructure, 

19 strengthen capabilities of first responders, and en20 hance emergency preparedness, among other Federal 

21 and State energy security priorities. 

22 (e) REPORT.—The Collaborative shall submit to Con23 gress and each State director of homeland security or 

24 emergency management a report that describes the results 

25 of— 


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1 (1) the multistate analysis under subsection (c); 

2 and 

3 (2) the Federal-State pilot projects under sub4 section (d). 

5 (f) FUNDING SOURCES.—Funding for the Collabo6 rative may be provided from— 

7 (1) amounts specifically appropriated for the 

8 Collaborative; and 

9 (2) an equal match of Federal funds by any 

10 State receiving funds as part of a Federal-State 

11 pilot project under subsection (d). 

12 (g) AUTHORIZATION OF APPROPRIATIONS.—There is 

13 authorized to be appropriated to carry out this section 

14 $500,000,000 for each of fiscal years 2007 through 2010. 

15 SEC. 423. ASSISTANCE FOR STATE PROGRAMS TO RETIRE 

16 FUEL-INEFFICIENT MOTOR VEHICLES. 

17 (a) DEFINITIONS.—In this section: 

18 (1) FUEL-EFFICIENT AUTOMOBILE.—The term 

19 ‘‘fuel-efficient automobile’’ means a passenger auto20 mobile or a light-duty truck that has a fuel economy 

21 rating that is 40 percent greater than the average 

22 fuel economy standard prescribed pursuant to sec23 tion 32902 of title 49, United States Code, or other 

24 law, applicable to the passenger automobile or light25 duty truck. 


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1 (2) FUEL-INEFFICIENT AUTOMOBILE.—The 

2 term ‘‘fuel-inefficient automobile’’ means a pas3 senger automobile or a light-duty truck that— 

4 (A) is manufactured in a model year more 

5 than 15 years before the fiscal year in which 

6 appropriations authorized under subsection (f) 

7 are made available; and 

8 (B) at the time of manufacture, had a fuel 

9 economy rating that was equal to or less than 

10 20 miles per gallon. 

11 (3) LIGHT-DUTY TRUCK.— 

12 (A) IN GENERAL.—The term ‘‘light-duty 

13 truck’’ means an automobile that is not a pas14 senger automobile. 

15 (B) INCLUSIONS.—The term ‘‘light-duty 

16 truck’’ includes a pickup truck, a van, and a 

17 four-wheel-drive general utility vehicle (as those 

18 terms are defined in section 600.002–85 of title 

19 40, Code of Federal Regulations (or successor 

20 regulations)). 

21 (4) STATE.—The term ‘‘State’’ means— 

22 (A) a State; and 

23 (B) the District of Columbia. 

24 (b) ESTABLISHMENT.—The Secretary shall establish 

25 a program, to be known as the ‘‘National Motor Vehicle 


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1 Efficiency Improvement Program’’, under which the Sec2 retary shall provide grants to States to operate voluntary 

3 programs to offer owners of fuel-inefficient automobiles fi4 nancial incentives to replace the fuel-inefficient auto5 mobiles with fuel-efficient automobiles. 

6 (c) STATE PLAN.— 

7 (1) IN GENERAL.—For a State to be eligible to 

8 receive funds under the program, the Governor of 

9 the State shall submit to the Secretary a plan to 

10 carry out a program under this section in the State. 

11 (2) ADDITIONAL STATE CREDIT.—In addition 

12 to the payment under subsection (e)(6), the State 

13 plan may provide for a credit that may be redeemed 

14 by the owner of a replaced fuel-inefficient automobile 

15 at the time of purchase of a new fuel-efficient auto16 mobile for use as the replacement. 

17 (d) ALLOCATION FORMULA.—The amounts appro18 priated pursuant to subsection (f) shall be allocated among 

19 the States in the proportion that— 

20 (1) the number of registered motor vehicles in 

21 each State as of the date on which the Secretary 

22 computes shares under this subsection; bears to 

23 (2) the number of registered motor vehicles in 

24 all States on that date. 


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1 (e) ELIGIBILITY CRITERIA.—The Secretary shall ap2 prove a State plan submitted under subsection (c)(1) and 

3 provide the funds made available under subsection (f), if 

4 the State plan— 

5 (1) except as provided in paragraph (7), re6 quires that all passenger automobiles and light-duty 

7 trucks turned in be scrapped, after allowing a period 

8 of time for the recovery of spare parts; 

9 (2) requires that all passenger automobiles and 

10 light-duty trucks turned in be registered in the State 

11 in order to be eligible; 

12 (3) requires that all passenger automobiles and 

13 light-duty trucks turned in be operational at the 

14 time at which the passenger automobiles and light15 duty trucks are turned in; 

16 (4) restricts automobile owners (except non17 profit organizations) from turning in more than 1 

18 passenger automobile and 1 light-duty truck during 

19 a 1-year period; 

20 (5) provides an appropriate payment to the per21 son recycling the scrapped passenger automobile or 

22 light-duty truck for each turned-in passenger auto23 mobile or light-duty truck; 

24 (6) subject to subsection (c)(2), provides a min25 imum payment to the automobile owner for each 


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1 passenger automobile and light-duty truck turned in; 

2 and 

3 (7) provides appropriate exceptions to the 

4 scrappage requirement for vehicles that qualify as 

5 antique cars under State law. 

6 (f) AUTHORIZATION OF APPROPRIATIONS.—There 

7 are authorized to be appropriated to the Secretary such 

8 sums as are necessary to carry out this section, to remain 

9 available until expended. 

10 Subtitle D—International Clean 

11 Energy Deployment 

12 SEC. 431. CLEAN ENERGY TECHNOLOGY DEPLOYMENT IN 

13 DEVELOPING COUNTRIES. 

14 Title VII of the Global Environmental Protection As15 sistance Act of 1989 (22 U.S.C. 7901 et seq.) is amending 

16 by adding at the end the following: 

17 ‘‘PART D—CLEAN ENERGY TECHNOLOGY 

18 DEPLOYMENT IN DEVELOPING COUNTRIES 

19 ‘‘SEC. 741. DEFINITIONS. 

20 ‘‘In this part: 

21 ‘‘(1) CLEAN ENERGY TECHNOLOGY.—The term 

22 ‘clean energy technology’ means an energy supply or 

23 end-use technology that, over its lifecycle and com24 pared to a similar technology already in commercial 

25 use in any developing country— 


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1 ‘‘(A) is reliable, affordable, economically 

2 viable, socially acceptable, and compatible with 

3 the needs and norms of the host country; 

4 ‘‘(B) results in— 

5 ‘‘(i) reduced emissions of greenhouse 

6 gases; or 

7 ‘‘(ii) increased geological sequestra8 tion; and 

9 ‘‘(C) may— 

10 ‘‘(i) substantially lower emissions of 

11 air pollutants; and 

12 ‘‘(ii) generate substantially smaller or 

13 less hazardous quantities of solid or liquid 

14 waste. 

15 ‘‘(2) DEPARTMENT.—The term ‘Department’ 

16 means the Department of State. 

17 ‘‘(3) DEVELOPING COUNTRY.— 

18 ‘‘(A) IN GENERAL.—The term ‘developing 

19 country’ means any country not listed in Annex 

20 I of the United Nations Framework Convention 

21 on Climate Change, done at New York on May 

22 9, 1992. 

23 ‘‘(B) INCLUSION.—The term ‘developing 

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1 omy in transition, as determined by the Sec2 retary. 

3 ‘‘(4) GEOLOGICAL SEQUESTRATION.—The term 

4 ‘geological sequestration’ means the capture and 

5 long-term storage in a geological formation of a 

6 greenhouse gas from an energy producing facility, 

7 which prevents the release of greenhouse gases into 

8 the atmosphere. 

9 ‘‘(5) GREENHOUSE GAS.—The term ‘greenhouse 

10 gas’ means— 

11 ‘‘(A) carbon dioxide; 

12 ‘‘(B) methane; 

13 ‘‘(C) nitrous oxide; 

14 ‘‘(D) hydrofluorocarbons; 

15 ‘‘(E) perfluorocarbons; and 

16 ‘‘(F) sulfur hexafluoride. 

17 ‘‘(6) INSTITUTION OF HIGHER EDUCATION.— 

18 The term ‘institution of higher education’ has the 

19 meaning given the term in section 101(a) of the 

20 Higher Education Act of 1965 (20 U.S.C. 1001(a)). 

21 ‘‘(7) INTERAGENCY WORKING GROUP.—The 

22 term ‘Interagency Working Group’ means the Inter23 agency Working Group on Clean Energy Technology 

24 Exports established under section 742(b)(1)(A). 


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1 ‘‘(8) NATIONAL LABORATORY.—The term ‘Na2 tional Laboratory’ has the meaning given the term 

3 in section 2 of the Energy Policy Act of 2005 (42 

4 U.S.C. 15801). 

5 ‘‘(9) QUALIFYING PROJECT.—The term ‘quali6 fying project’ means a project meeting the criteria 

7 established under section 745(b). 

8 ‘‘(10) SECRETARY.—The term ‘Secretary’ 

9 means the Secretary of State. 

10 ‘‘(11) STATE.—The term ‘State’ means— 

11 ‘‘(A) a State; 

12 ‘‘(B) the District of Columbia; 

13 ‘‘(C) the Commonwealth of Puerto Rico; 

14 and 

15 ‘‘(D) any other territory or possession of 

16 the United States. 

17 ‘‘(12) STRATEGY.—The term ‘Strategy’ means 

18 the strategy established under section 743. 

19 ‘‘(13) TASK FORCE.—The term ‘Task Force’ 

20 means the Task Force on International Clean En21 ergy Cooperation established under section 742(a). 

22 ‘‘(14) UNITED STATES.—The term ‘United 

23 States’, when used in a geographical sense, means 

24 all of the States. 


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1 ‘‘SEC. 742. ORGANIZATION. 

2 ‘‘(a) TASK FORCE.— 

3 ‘‘(1) ESTABLISHMENT.—Not later than 90 days 

4 after the date of enactment of this part, the Presi5 dent shall establish a Task Force on International 

6 Clean Energy Cooperation. 

7 ‘‘(2) COMPOSITION.—The Task Force shall be 

8 composed of— 

9 ‘‘(A) the Secretary, who shall serve as 

10 Chairperson; and 

11 ‘‘(B) representatives, appointed by the 

12 head of the respective Federal agency, of— 

13 ‘‘(i) the Department of Commerce; 

14 ‘‘(ii) the Department of the Treasury; 

15 ‘‘(iii) the Department of Energy; 

16 ‘‘(iv) the Environmental Protection 

17 Agency; 

18 ‘‘(v) the United States Agency for 

19 International Development; 

20 ‘‘(vi) the Export-Import Bank; 

21 ‘‘(vii) the Overseas Private Investment 

22 Corporation; 

23 ‘‘(viii) the Trade and Development 

24 Agency; 

25 ‘‘(ix) the Small Business Administra26 tion; 


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1 ‘‘(x) the Office of United States Trade 

2 Representative; and 

3 ‘‘(xi) other Federal agencies, as deter4 mined by the President. 

5 ‘‘(3) DUTIES.— 

6 ‘‘(A) LEAD AGENCY.—The Task Force 

7 shall act as the lead agency in the development 

8 and implementation of strategy under section 

9 743. 

10 ‘‘(B) COORDINATION AND IMPLEMENTA11 TION.—The Task Force shall support the co12 ordination and implementation of programs 

13 under sections 1331, 1332, and 1608 of the 

14 Energy Policy Act of 1992 (42 U.S.C. 13361, 

15 13362, 13387). 

16 ‘‘(4) TERMINATION.—The Task Force, includ17 ing any working group established by the Task 

18 Force, shall terminate on January 1, 2016. 

19 ‘‘(b) WORKING GROUPS.— 

20 ‘‘(1) ESTABLISHMENT.—The Task Force— 

21 ‘‘(A) shall establish an Interagency Work22 ing Group on Clean Energy Technology Ex23 ports; and 

24 ‘‘(B) may establish other working groups 

25 as necessary to carry out this part. 


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1 ‘‘(2) COMPOSITION OF INTERAGENCY WORKING

2 GROUP.—The Interagency Working Group shall be 

3 composed of— 

4 ‘‘(A) the Secretary of Energy, the Sec5 retary of Commerce, and the Administrator of 

6 the United States Agency for International De7 velopment, who shall jointly serve as Chair8 persons; and 

9 ‘‘(B) other members, as determined by the 

10 Task Force. 

11 ‘‘(c) INTERAGENCY CENTER.— 

12 ‘‘(1) ESTABLISHMENT.—There is established an 

13 Interagency Center in the Office of International 

14 Energy Market Development of the Department of 

15 Energy. 

16 ‘‘(2) DUTIES.—The Interagency Center shall— 

17 ‘‘(A) assist the Interagency Working 

18 Group in carrying out this part; and 

19 ‘‘(B) perform such other duties as are de20 termined to be appropriate by the Secretary of 

21 Energy. 

22 ‘‘SEC. 743. STRATEGY. 

23 ‘‘(a) INITIAL STRATEGY.— 

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

25 the date of enactment of this part, the Task Force 


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1 shall develop and submit to the President a Strategy 

2 to— 

3 ‘‘(A) support the development and imple4 mentation of programs and policies in devel5 oping countries to promote the adoption of 

6 clean energy technologies and energy efficiency 

7 technologies and strategies, with an emphasis 

8 on those developing countries that are expected 

9 to experience the most significant growth in en10 ergy production and use over the next 20 years; 

11 ‘‘(B) open and expand clean energy tech12 nology markets and facilitate the export of 

13 clean energy technology to developing countries, 

14 in a manner consistent with the subsidy codes 

15 of the World Trade Organization; 

16 ‘‘(C) integrate into the foreign policy objec17 tives of the United States the promotion of— 

18 ‘‘(i) clean energy technology deploy19 ment and reduced greenhouse gas emis20 sions in developing countries; and 

21 ‘‘(ii) clean energy technology exports; 

22 ‘‘(D) establish a pilot program that pro23 vides financial assistance for qualifying 

24 projects; and 


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1 ‘‘(E) develop financial mechanisms and in2 struments (including securities that mitigate 

3 the political and foreign exchange risks of uses 

4 that are consistent with the foreign policy of 

5 the United States by combining the private sec6 tor market and government enhancements) 

7 that— 

8 ‘‘(i) are cost-effective; and 

9 ‘‘(ii) facilitate private capital invest10 ment in clean energy technology projects in 

11 developing countries. 

12 ‘‘(2) TRANSMISSION TO CONGRESS.—On receiv13 ing the Strategy from the Task Force under para14 graph (1), the President shall transmit to Congress 

15 the Strategy. 

16 ‘‘(b) UPDATES.— 

17 ‘‘(1) IN GENERAL.—Not later than 2 years 

18 after the date of submission of the initial Strategy 

19 under subsection (a)(1), and every 2 years there20 after— 

21 ‘‘(A) the Task Force shall— 

22 ‘‘(i) review and update the Strategy; 

23 and 

24 ‘‘(ii) report the results of the review 

25 and update to the President; and 


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1 ‘‘(B) the President shall submit to Con2 gress a report on the Strategy. 

3 ‘‘(2) INCLUSIONS.—The report shall include— 

4 ‘‘(A) the updated Strategy; 

5 ‘‘(B) a description of the assistance pro6 vided under this part; 

7 ‘‘(C) the results of the pilot projects car8 ried out under this part, including a compara9 tive analysis of the relative merits of each pilot 

10 project; 

11 ‘‘(D) the activities and progress reported 

12 by developing countries to the Department 

13 under section 746(b)(2); and 

14 ‘‘(E) the activities and progress reported 

15 towards meeting the goals established under 

16 section 746(b)(2). 

17 ‘‘(c) CONTENT.—In developing, updating, and sub18 mitting a report on the Strategy, the Task Force shall— 

19 ‘‘(1) assess— 

20 ‘‘(A) energy trends, energy needs, and po21 tential energy resource bases in developing 

22 countries; and 

23 ‘‘(B) the implications of the trends and 

24 needs for domestic and global economic and se25 curity interests; 


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1 ‘‘(2) analyze technology, policy, and market op2 portunities for international development, dem3 onstration, and deployment of clean energy tech4 nologies and strategies; 

5 ‘‘(3) examine relevant trade, tax, finance, inter6 national, and other policy issues to assess what poli7 cies, in the United States and in developing coun8 tries, would help open markets and improve clean 

9 energy technology exports of the United States in 

10 support of— 

11 ‘‘(A) enhancing energy innovation and co12 operation, including energy sector and market 

13 reform, capacity building, and financing meas14 ures; 

15 ‘‘(B) improving energy end-use efficiency 

16 technologies (including buildings and facilities) 

17 and vehicle, industrial, and co-generation tech18 nology initiatives; and 

19 ‘‘(C) promoting energy supply technologies, 

20 including fossil, nuclear, and renewable tech21 nology initiatives; 

22 ‘‘(4) investigate issues associated with building 

23 capacity to deploy clean energy technology in devel24 oping countries, including— 

25 ‘‘(A) energy-sector reform; 


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1 ‘‘(B) creation of open, transparent, and 

2 competitive markets for clean energy tech3 nologies; 

4 ‘‘(C) the availability of trained personnel to 

5 deploy and maintain clean energy technology; 

6 and 

7 ‘‘(D) demonstration and cost-buydown 

8 mechanisms to promote first adoption of clean 

9 energy technology; 

10 ‘‘(5) establish priorities for promoting the diffu11 sion and adoption of clean energy technologies and 

12 strategies in developing countries, taking into ac13 count economic and security interests of the United 

14 States and opportunities for the export of technology 

15 of the United States; 

16 ‘‘(6) identify the means of integrating the prior17 ities established under paragraph (5) into bilateral, 

18 multilateral, and assistance activities and commit19 ments of the United States; 

20 ‘‘(7) establish methodologies for the measure21 ment, monitoring, verification, and reporting under 

22 section 746(b)(2) of the greenhouse gas emission im23 pacts of clean energy projects and policies in devel24 oping countries; 


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1 ‘‘(8) establish a registry that is accessible to the 

2 public through electronic means (including through 

3 the Internet) in which information reported under 

4 section 746(b)(2) shall be collected; 

5 ‘‘(9) make recommendations to the heads of ap6 propriate Federal agencies on ways to streamline 

7 Federal programs and policies to improve the role of 

8 the agencies in the international development, dem9 onstration, and deployment of clean energy tech10 nology; 

11 ‘‘(10) make assessments and recommendations 

12 regarding the distinct technological, market, re13 gional, and stakeholder challenges necessary to de14 ploy clean energy technology; 

15 ‘‘(11) recommend conditions and criteria that 

16 will help ensure that funds provided by the United 

17 States promote sound energy policies in developing 

18 countries while simultaneously opening their markets 

19 and exporting clean energy technology of the United 

20 States; 

21 ‘‘(12) establish an advisory committee, com22 posed of representatives of the private sector and 

23 other interested groups, on the export and deploy24 ment of clean energy technology; 


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1 ‘‘(13) establish a coordinated mechanism for 

2 disseminating information to the private sector and 

3 the public on clean energy technologies and clean en4 ergy technology transfer opportunities; and 

5 ‘‘(14) monitor the progress of each Federal 

6 agency in promoting the purposes of this part, in ac7 cordance with— 

8 ‘‘(A) the 5-year strategic plan submitted to 

9 Congress in October 2002; and 

10 ‘‘(B) other applicable law. 

11 ‘‘SEC. 744. CLEAN ENERGY ASSISTANCE TO DEVELOPING 

12 COUNTRIES. 

13 ‘‘(a) IN GENERAL.—Subject to section 746, the Sec14 retary may provide assistance to developing countries for 

15 activities that are consistent with the priorities established 

16 in the Strategy. 

17 ‘‘(b) ASSISTANCE.—The assistance may be provided 

18 through— 

19 ‘‘(1) the Millennium Challenge Corporation es20 tablished under section 604(a) of the Millennium 

21 Challenge Act of 2003 (22 U.S.C. 7703(a)); 

22 ‘‘(2) the Global Village Energy Partnership; 

23 and 

24 ‘‘(3) other international assistance programs or 

25 activities of— 


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1 ‘‘(A) the Department; 

2 ‘‘(B) the United States Agency for Inter3 national Development; and 

4 ‘‘(C) other Federal agencies. 

5 ‘‘(c) ELIGIBLE ACTIVITIES.—The activities sup6 ported under this section include— 

7 ‘‘(1) development of national action plans and 

8 policies to— 

9 ‘‘(A) facilitate the provision of clean energy 

10 services and the adoption of energy efficiency 

11 measures; 

12 ‘‘(B) identify linkages between the use of 

13 clean energy technologies and the provision of 

14 agricultural, transportation, water, health, edu15 cational, and other development-related services; 

16 and 

17 ‘‘(C) integrate the use of clean energy 

18 technologies into national strategies for eco19 nomic growth, poverty reduction, and sustain20 able development; 

21 ‘‘(2) strengthening of public and private sector 

22 capacity to— 

23 ‘‘(A) assess clean energy needs and op24 tions; 


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1 ‘‘(B) identify opportunities to reduce, 

2 avoid, or sequester greenhouse gas emissions; 

3 ‘‘(C) establish enabling policy frameworks; 

4 ‘‘(D) develop and access financing mecha5 nisms; and 

6 ‘‘(E) monitor progress in implementing 

7 clean energy and greenhouse gas reduction 

8 strategies; 

9 ‘‘(3) enactment and implementation of market10 favoring measures to promote commercial-based en11 ergy service provision and to improve the govern12 ance, efficiency, and financial performance of the en13 ergy sector; and 

14 ‘‘(4) development and use of innovative public 

15 and private mechanisms to catalyze and leverage fi16 nancing for clean energy technologies, including use 

17 of the development credit authority of the United 

18 States Agency for International Development and 

19 credit enhancements through the Export-Import 

20 Bank and the Overseas Private Investment Corpora21 tion. 

22 ‘‘SEC. 745. PILOT PROGRAM FOR DEMONSTRATION 

23 PROJECTS. 

24 ‘‘(a) IN GENERAL.—Not later than 2 years after the 

25 date of enactment of this part, the Secretary, in consultaVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00238 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 tion with the Secretary of Energy and the Administrator 

2 of the United States Agency for International Develop3 ment, shall, by regulation, establish a pilot program that 

4 provides financial assistance for qualifying projects con5 sistent with the Strategy and the performance criteria es6 tablished under section 746. 

7 ‘‘(b) QUALIFYING PROJECTS.—To be qualified to re8 ceive assistance under this section, a project shall— 

9 ‘‘(1) be a project— 

10 ‘‘(A) to construct an energy production fa11 cility in a developing country for the production 

12 of energy to be consumed in the developing 

13 country; or 

14 ‘‘(B) to improve the efficiency of energy 

15 use in a developing country; 

16 ‘‘(2) be a project that— 

17 ‘‘(A) is submitted by a firm of the United 

18 States to the Secretary in accordance with pro19 cedures established by the Secretary by regula20 tion; 

21 ‘‘(B) meets the requirements of section 

22 1608(k) of the Energy Policy Act of 1992 (42 

23 U.S.C. 13387(k)); 


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1 ‘‘(C) uses technology that has been suc2 cessfully developed or deployed in the United 

3 States; and 

4 ‘‘(D) is selected by the Secretary without 

5 regard to the developing country in which the 

6 project is located, with notice of the selection 

7 published in the Federal Register; and 

8 ‘‘(3) when deployed, result in a greenhouse gas 

9 emission reduction (when compared to the tech10 nology that would otherwise be deployed) of at 

11 least— 

12 ‘‘(A) in the case of a unit or energy-effi13 ciency measure placed in service during the pe14 riod beginning on the date of enactment of this 

15 part and ending on December 31, 2009, 20 per16 centage points; 

17 ‘‘(B) in the case of a unit or energy-effi18 ciency measure placed in service during the pe19 riod beginning on January 1, 2010, and ending 

20 on December 31, 2019, 40 percentage points; 

21 and 

22 ‘‘(C) in the case of a unit or energy-effi23 ciency measure placed in service after December 

24 31, 2019, 60 percentage points. 

25 ‘‘(c) FINANCIAL ASSISTANCE.— 


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1 ‘‘(1) IN GENERAL.—For each qualifying project 

2 selected by the Secretary to participate in the pilot 

3 program, the Secretary shall make a loan or loan 

4 guarantee available for not more than 50 percent of 

5 the total cost of the project. 

6 ‘‘(2) INTEREST RATE.—The interest rate on a 

7 loan made under this subsection shall be equal to 

8 the current average yield on outstanding obligations 

9 of the United States with remaining periods of ma10 turity comparable to the maturity of the loan. 

11 ‘‘(3) HOST COUNTRY CONTRIBUTION.—To be 

12 eligible for a loan or loan guarantee for a project in 

13 a host country under this subsection, the host coun14 try shall— 

15 ‘‘(A) make at least a 10 percent contribu16 tion toward the total cost of the project; and 

17 ‘‘(B) verify to the Secretary (using the 

18 methodology established under section 

19 743(c)(7)) the quantity of annual greenhouse 

20 gas emissions reduced, avoided, or sequestered 

21 as a result of the deployment of the project. 

22 ‘‘(4) CAPACITY BUILDING RESEARCH.— 

23 ‘‘(A) IN GENERAL.—A proposal made for a 

24 qualifying project may include a research comVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00241 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 ponent intended to build technological capacity 

2 within the host country. 

3 ‘‘(B) RESEARCH.—To be eligible for a loan 

4 or loan guarantee under this paragraph, the re5 search shall— 

6 ‘‘(i) be related to the technology being 

7 deployed; and 

8 ‘‘(ii) involve— 

9 ‘‘(I) an institution in the host 

10 country; and 

11 ‘‘(II) a participant from the 

12 United States that is an industrial en13 tity, an institution of higher edu14 cation, or a National Laboratory. 

15 ‘‘(C) HOST COUNTRY CONTRIBUTION.—To 

16 be eligible for a loan or loan guarantee for re17 search in a host country under this paragraph, 

18 the host country shall make at least a 50 per19 cent contribution toward the total cost of the 

20 research. 

21 ‘‘(5) GRANTS.— 

22 ‘‘(A) IN GENERAL.—The Secretary, in con23 sultation with the Secretary of Energy and the 

24 Administrator of the United States Agency for 

25 International Development, may, at the request 


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1 of the United States ambassador to a host 

2 country, make grants to help address and over3 come specific, urgent, and unforeseen obstacles 

4 in the implementation of a qualifying project. 

5 ‘‘(B) MAXIMUM AMOUNT.—The total 

6 amount of a grant made for a qualifying project 

7 under this paragraph may not exceed 

8 $1,000,000. 

9 ‘‘SEC. 746. PERFORMANCE CRITERIA FOR MAJOR ENERGY 

10 CONSUMERS. 

11 ‘‘(a) IDENTIFICATION OF MAJOR ENERGY CON12 SUMERS.—Not later than 1 year after the date of enact13 ment of this part, the Task Force shall identify those de14 veloping countries that, by virtue of present and projected 

15 energy consumption, represent the predominant share of 

16 energy use among developing countries. 

17 ‘‘(b) PERFORMANCE CRITERIA.—As a condition of 

18 accepting assistance provided under sections 744 and 745, 

19 any developing country identified under subsection (a) 

20 shall— 

21 ‘‘(1) meet the eligibility criteria established 

22 under section 607 of the Millennium Challenge Act 

23 of 2003 (22 U.S.C. 7706), notwithstanding the eligi24 bility of the developing country as a candidate counVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00243 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 try under section 606 of that Act (22 U.S.C. 7705); 

2 and 

3 ‘‘(2) agree to establish and report on progress 

4 in meeting specific goals for reduced energy-related 

5 greenhouse gas emissions and specific goals for— 

6 ‘‘(A) increased access to clean energy serv7 ices among unserved and underserved popu8 lations; 

9 ‘‘(B) increased use of renewable energy re10 sources; 

11 ‘‘(C) increased use of lower greenhouse 

12 gas-emitting fossil fuel-burning technologies; 

13 ‘‘(D) more efficient production and use of 

14 energy; 

15 ‘‘(E) greater reliance on advanced energy 

16 technologies; 

17 ‘‘(F) the sustainable use of traditional en18 ergy resources; or 

19 ‘‘(G) other goals for improving energy-re20 lated environmental performance, including the 

21 reduction or avoidance of local air and water 

22 quality and solid waste contaminants. 


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1 ‘‘SEC. 747. AUTHORIZATION OF APPROPRIATIONS. 

2 ‘‘There are authorized to be appropriated such sums 

3 as are necessary to carry out this part for each of fiscal 

4 years 2006 through 2015.’’ 

5 TITLE V—SECURING A RELI6 ABLE, AFFORDABLE, AND 

7 SUSTAINABLE ENERGY FU8 TURE 

9 Subtitle A—Advanced Research 

10 Project Agency for Energy 

11 SEC. 501. OFFICE OF ADVANCED ENERGY RESEARCH, TECH12 NOLOGY DEVELOPMENT, AND DEPLOYMENT. 

13 (a) ESTABLISHMENT.—The Secretary of Energy 

14 shall establish in the Department of Energy the Office of 

15 Advanced Energy Research, Technology Development, and 

16 Deployment (referred to in this section as the ‘‘Office’’), 

17 to be headed by a Director (referred to in this section as 

18 the ‘‘Director’’) who reports to the Secretary. 

19 (b) MISSION.—The mission of the Office is— 

20 (1) to implement an innovative energy research, 

21 technology development, and deployment program 

22 to— 

23 (A) increase national security by signifi24 cantly reducing petroleum and imported fuels 

25 consumption; 


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1 (B) significantly improve the efficiency of 

2 electricity use and the reliability of the elec3 tricity system; and 

4 (C) significantly reduce greenhouse gas 

5 emissions; and 

6 (2) to sponsor a diverse portfolio of cutting7 edge, high-payoff research, development, and deploy8 ment projects to carry out the program. 

9 (c) EXPERIMENTAL PERSONNEL AUTHORITY.—The 

10 Director may staff the Office primarily using a program 

11 of experimental use of special personnel management au12 thority in order to facilitate recruitment of eminent ex13 perts in science or engineering for management of re14 search and development projects and programs adminis15 tered by the Director under similar terms and conditions 

16 as the authority is exercised under section 1101 of the 

17 Strom Thurmond National Defense Authorization Act for 

18 Fiscal Year 1999 (Public Law 105–261; 5 U.S.C. 3104 

19 note), as determined by the Director. 

20 (d) TRANSACTIONS OTHER THAN CONTRACTS AND

21 GRANTS.—To carry out projects under this section, the 

22 Director may enter into transactions to carry out ad23 vanced research projects under this subsection under simi24 lar terms and conditions as the authority is exercised 


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1 under section 646(g) of the Department of Energy Orga2 nization Act (42 U.S.C. 7256(g)). 

3 (e) PRIZES FOR ADVANCED TECHNOLOGY ACHIEVE4 MENTS.— 

5 (1) IN GENERAL.—Subject to paragraphs (2) 

6 through (4), the Director may carry out a program 

7 to award cash prizes in recognition of outstanding 

8 achievements in basic, advanced, and applied re9 search, technology development, and prototype devel10 opment that have the potential to advance the mis11 sion described in subsection (b) under similar terms 

12 and conditions as the authority is exercised under 

13 section 1008 of the Energy Policy Act of 2005 (42 

14 U.S.C. 16396). 

15 (2) COMPETITION REQUIREMENTS.—In car16 rying out this subsection, the Director shall— 

17 (A) use a competitive process for the selec18 tion of recipients of cash prizes; and 

19 (B) conduct widely-advertised solicitation 

20 of submissions of research results, technology 

21 developments, and prototypes. 

22 (3) MAXIMUM AMOUNT FOR ALL CASH

23 PRIZES.—The total amount of all cash prizes award24 ed for a fiscal year under this subsection may not 

25 exceed $50,000,000. 


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1 (4) MAXIMUM AMOUNT OF INDIVIDUAL CASH

2 PRIZES.—The amount of an individual cash prize 

3 awarded under this subsection may not exceed 

4 $10,000,000 unless the amount of the award is ap5 proved by the Secretary of Energy. 

6 (f) ANNUAL REPORTS.—As soon as practicable after 

7 the end of each fiscal year for which the Director receives 

8 funds under subsection (h), the Director shall submit to 

9 the Committee on Energy and Natural Resources of the 

10 Senate and the Committee on Energy and Commerce, and 

11 the Committee on Science, of the House of Representa12 tives a report on the progress, challenges, future mile13 stones, and strategic plan of the Office, including— 

14 (1) a description of, and rationale for, any 

15 changes in the strategic plan; 

16 (2) the adequacy of human and financial re17 sources necessary to achieve the mission described in 

18 subsection (b); and 

19 (3) in the case of cash prizes awarded under 

20 subsection (e), a description of— 

21 (A) the applications of the research, tech22 nology, or prototypes for which prizes were 

23 awarded; 

24 (B) the total amount of the prizes that 

25 were awarded; 


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1 (C) the methods used for solicitation and 

2 evaluation of submissions and an assessment of 

3 the effectiveness of those methods; and 

4 (D) recommendations to improve the prize 

5 program. 

6 (g) RELATIONSHIP TO OTHER AUTHORITY.—The 

7 program under this section may be carried out in conjunc8 tion with, or in addition to, the exercise of any other au9 thority of the Director to acquire, support, or stimulate 

10 basic, advanced, and applied research, technology develop11 ment, or prototype projects. 

12 (h) AUTHORIZATION OF APPROPRIATIONS.—There 

13 are authorized to be appropriated to carry out this sec14 tion— 

15 (1) $1,000,000,000 for fiscal year 2007; and 

16 (2) $2,000,000,000 for each of fiscal years 

17 2008 through 2011. 

18 Subtitle B—Near-Term Vehicle 

19 Technology Program 

20 SEC. 505. NEAR-TERM VEHICLE TECHNOLOGY PROGRAM. 

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

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

23 industry, comprehensive development, demonstra24 tion, and commercialization of a wide range of elecVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00249 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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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 and other on-road and nonroad vehicles 

11 that are using petroleum and are mobile sources of 

12 emissions— 

13 (A) including the more than 3,000,000 re14 ported units (such as electric forklifts, golf 

15 carts, and similar nonroad vehicles) in use on 

16 the date of enactment of this Act; and 

17 (B) with the goals of enhancing the energy 

18 security of the United States, reducing depend19 ence on imported oil and reducing emissions 

20 through the expansion of grid-supported mobil21 ity; 

22 (4) to accelerate the widespread commercializa23 tion of all types of electric drive vehicle technology 

24 into all sizes and applications of vehicles, including 


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1 commercialization of plug-in hybrid electric vehicles 

2 and plug-in hybrid fuel cell vehicles; and 

3 (5) to improve the energy efficiency of, and re4 duce the petroleum use in, transportation. 

5 (b) DEFINITIONS.—In this section: 

6 (1) ADMINISTRATOR.—The term ‘‘Adminis7 trator’’ means the Administrator of the Environ8 mental Protection Agency. 

9 (2) BATTERY.—The term ‘‘battery’’ means an 

10 energy storage device used in an on-road vehicle or 

11 nonroad vehicle powered, in whole or in part, using 

12 an off-board or on-board source of electricity. 

13 (3) ELECTRIC DRIVE TRANSPORTATION TECH14 NOLOGY.—The term ‘‘electric drive transportation 

15 technology’’ means— 

16 (A) vehicles that use an electric motor for 

17 all or part of their motive power and that may 

18 or may not use off-board electricity, including 

19 battery electric vehicles, fuel cell vehicles, en20 gine dominant hybrid electric vehicles, plug-in 

21 hybrid electric vehicles, plug-in hybrid fuel cell 

22 vehicles, and electric rail; or 

23 (B) equipment relating to transportation 

24 or mobile sources of air pollution that use an 

25 electric motor to replace an internal combustion 


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1 engine for all or part of the work of the equip2 ment, including corded electric equipment 

3 linked to transportation or mobile sources of air 

4 pollution. 

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

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

8 that— 

9 (A) is propelled by an internal combustion 

10 engine or heat engine using— 

11 (i) any combustible fuel; 

12 (ii) an on-board, rechargeable storage 

13 device; and 

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

15 source of electricity. 

16 (5) FUEL CELL VEHICLE.—The term ‘‘fuel cell 

17 vehicle’’ means an on-road vehicle or nonroad vehicle 

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

19 Spark M. Matsunaga Hydrogen Act of 2005 (42 

20 U.S.C. 16152)). 

21 (6) LIGHTWEIGHTING.—The term 

22 ‘‘lightweighting’’ means the process of reducing the 

23 weight of components or structural materials of a 

24 vehicle to achieve an overall reduction in weight of 

25 the vehicle to achieve energy efficiency, maintain 


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1 safety, improve performance, or achieve a similar 

2 goal. 

3 (7) NONROAD VEHICLE.—The term ‘‘nonroad 

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

5 216 of the Clean Air Act (42 U.S.C. 7550). 

6 (8) PLUG-IN HYBRID ELECTRIC VEHICLE.—The 

7 term ‘‘plug-in hybrid electric vehicle’’ means an on8 road vehicle or nonroad vehicle that is propelled by 

9 an internal combustion engine or heat engine 

10 using— 

11 (A) any combustible fuel; 

12 (B) an on-board, rechargeable storage de13 vice; and 

14 (C) a means of using an off-board source 

15 of electricity. 

16 (9) PLUG-IN HYBRID FUEL CELL VEHICLE.— 

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

18 fuel cell vehicle with a battery powered by an off19 board source of electricity. 

20 (c) PROGRAM.—The Secretary shall conduct a pro21 gram of research, development, demonstration, and com22 mercial application for electric drive transportation and 

23 vehicle lightweighting technology, including— 

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


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

2 charging components; 

3 (3) high-powered drive train systems for pas4 senger and commercial vehicles and for nonroad 

5 equipment; 

6 (4) control system development and power train 

7 development and integration for plug-in hybrid elec8 tric vehicles, plug-in hybrid fuel cell vehicles, and en9 gine dominant hybrid electric vehicles, including— 

10 (A) development of efficient cooling sys11 tems; 

12 (B) analysis and development of control 

13 systems that minimize the emissions profile 

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

15 hybrid drive system; and 

16 (C) development of different control sys17 tems that optimize for different goals, includ18 ing— 

19 (i) battery life; 

20 (ii) reduction of petroleum consump21 tion; and 

22 (iii) greenhouse gas reduction; 

23 (5) nanomaterial technology applied to both 

24 battery and fuel cell systems; 


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1 (6) large-scale demonstration, testing, and eval2 uation of plug-in hybrid electric vehicles in different 

3 applications with different batteries and control sys4 tems, including— 

5 (A) military applications; 

6 (B) mass market passenger and light-duty 

7 truck applications; 

8 (C) private fleet applications; and 

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

10 (7)(A) a nationwide education strategy for elec11 tric drive transportation technologies by providing 

12 secondary and high school teaching materials and 

13 support for university education focused on electric 

14 drive system and component engineering; and 

15 (B) development, in consultation with the Ad16 ministrator, of procedures for testing and certifi17 cation of criteria pollutants, fuel economy, and pe18 troleum use for light-, medium-, and heavy-duty ve19 hicle applications, including consideration of the ve20 hicle and fuel as a system, and not solely as an en21 gine; 

22 (8) nightly off-board charging; 

23 (9) advancement of battery and corded electric 

24 transportation technologies in mobile source applica25 tions by— 


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1 (A) improvement in battery, drive train, 

2 and control system technologies; and 

3 (B) working with industry and the Admin4 istrator to— 

5 (i) understand and inventory markets; 

6 and 

7 (ii) identify and implement methods of 

8 removing barriers for existing and emerg9 ing applications; and 

10 (10) components and structural materials used 

11 for vehicle lightweighting, including composites. 

12 (d) GOALS.—The goals of the electric drive transpor13 tation technology program established under subsection 

14 (c) shall be to develop, in partnership with industry and 

15 institutions of higher education, projects that focus on— 

16 (1) innovative electric drive technology devel17 oped in the United States; 

18 (2) growth of employment in the United States 

19 in electric drive design and manufacturing; 

20 (3) validation of the plug-in hybrid potential 

21 through fleet demonstrations; and 

22 (4) acceleration of fuel cell commercialization 

23 through comprehensive development and commer24 cialization of the electric drive technology systems 


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1 that are the foundational technology of the fuel cell 

2 vehicle system. 

3 (e) AUTHORIZATION OF APPROPRIATIONS.—There is 

4 authorized to be appropriated to carry out this section 

5 $600,000,000 for each of fiscal years 2007 through 2012. 

6 Subtitle C—Advanced Technology 

7 Motor Vehicles Manufacturing 

8 Credit 

9 SEC. 511. ADVANCED TECHNOLOGY MOTOR VEHICLES MAN10 UFACTURING CREDIT. 

11 (a) IN GENERAL.—Subpart B of part IV of sub12 chapter A of chapter 1 of the Internal Revenue Code of 

13 1986 (relating to foreign tax credit, etc.) is amended by 

14 adding at the end the following new section: 

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

16 MANUFACTURING CREDIT. 

17 ‘‘(a) CREDIT ALLOWED.—There shall be allowed as 

18 a credit against the tax imposed by this chapter for the 

19 taxable year an amount equal to 35 percent of the quali20 fied investment of an eligible taxpayer for such taxable 

21 year. 

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

23 section— 


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1 ‘‘(1) IN GENERAL.—The term ‘qualified invest2 ment’ means, with respect to any taxable year, the 

3 sum of— 

4 ‘‘(A) the costs paid or incurred by the eli5 gible taxpayer during such taxable year— 

6 ‘‘(i) to re-equip, expand, or establish 

7 any manufacturing facility of the eligible 

8 taxpayer to produce advanced technology 

9 motor vehicles or to produce eligible com10 ponents, and 

11 ‘‘(ii) for qualified research (as defined 

12 in section 41(d)) related to advanced tech13 nology motor vehicles and eligible compo14 nents, and 

15 ‘‘(B) qualified engineering integration 

16 costs. 

17 ‘‘(2) ATTRIBUTION RULES.—For purposes of 

18 paragraph (1)(A)(i), in the case of a manufacturing 

19 facility of the eligible taxpayer which produces both 

20 advanced technology motor vehicles and other motor 

21 vehicles, or eligible components and other compo22 nents, only the amount paid or incurred for the pro23 duction of advanced technology motor vehicles and 

24 eligible components shall be taken into account. 


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1 ‘‘(c) ELIGIBLE TAXPAYER.—For purposes of this sec2 tion, the term ‘eligible taxpayer’ means any taxpayer if 

3 more than 50 percent of its gross receipts for the taxable 

4 year is derived from the manufacture of motor vehicles 

5 or any component parts of such vehicles. 

6 ‘‘(d) DEFINITIONS.—For purposes of this section— 

7 ‘‘(1) ADVANCED TECHNOLOGY MOTOR VEHI8 CLE.—The term ‘advanced technology motor vehicle’ 

9 means— 

10 ‘‘(A) any new qualified fuel cell motor vehi11 cle (as defined in section 30B(b)(3)), 

12 ‘‘(B) any new advanced lean burn tech13 nology motor vehicle (as defined in section 

14 30B(c)(3)), 

15 ‘‘(C) any new qualified hybrid motor vehi16 cle (as defined in section 30B(d)(3)(A) and de17 termined without regard to any gross vehicle 

18 weight rating), and 

19 ‘‘(D) any new qualified alternative motor 

20 fuel vehicle (as defined in section 30B(e)(4)). 

21 ‘‘(2) ELIGIBLE COMPONENTS.—The term ‘eligi22 ble component’ means any component inherent to 

23 any advanced technology motor vehicle but not in24 herent to a motor vehicle which is not an advanced 

25 technology motor vehicle, including— 


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1 ‘‘(A) with respect to any gasoline or diesel2 electric new qualified hybrid motor vehicle, 

3 any— 

4 ‘‘(i) electric motor or generator, 

5 ‘‘(ii) power split device, 

6 ‘‘(iii) power control unit, 

7 ‘‘(iv) power controls, 

8 ‘‘(v) integrated starter generator, or 

9 ‘‘(vi) battery, 

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

11 qualified hybrid motor vehicle, any— 

12 ‘‘(i) hydraulic accumulator vessel, 

13 ‘‘(ii) hydraulic pump, or 

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

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

16 lean burn technology motor vehicle, any— 

17 ‘‘(i) diesel engine, 

18 ‘‘(ii) turbocharger, 

19 ‘‘(iii) fuel injection system, or 

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

21 a particle filter or NOx absorber, and 

22 ‘‘(D) with respect to any advanced tech23 nology motor vehicle, any other component sub24 mitted for approval by the Secretary. 


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1 ‘‘(3) QUALIFIED ENGINEERING INTEGRATION

2 COSTS.—For purposes of subsection (b)(1)(B), the 

3 term ‘qualified engineering integration costs’ means, 

4 with respect to any advanced technology motor vehi5 cle, costs incurred prior to the market introduction 

6 of such motor vehicle for engineering tasks related 

7 to— 

8 ‘‘(A) establishing functional, structural, 

9 and performance requirements for components 

10 and subsystems to meet overall vehicle objec11 tives for a specific application, 

12 ‘‘(B) designing interfaces for components 

13 and subsystems with mating systems within a 

14 specific vehicle application, 

15 ‘‘(C) designing cost effective, efficient, and 

16 reliable manufacturing processes to produce 

17 components and subsystems for a specific vehi18 cle application, and 

19 ‘‘(D) validating functionality and perform20 ance of components and subsystems for a spe21 cific vehicle application. 

22 ‘‘(4) MOTOR VEHICLE.—The term ‘motor vehi23 cle’ has the meaning given such term by section 

24 30(c)(2). 

25 ‘‘(e) LIMITATION BASED ON AMOUNT OF TAX.— 


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1 ‘‘(1) IN GENERAL.—The credit allowed under 

2 subsection (a) for any taxable year shall not exceed 

3 the sum of— 

4 ‘‘(A) the taxpayer’s regular tax liability (as 

5 defined in section 26(b)) for the taxable year, 

6 plus 

7 ‘‘(B) the tax imposed under section 55 for 

8 the taxable year. 

9 ‘‘(2) CARRYOVER OF UNUSED CREDIT

10 AMOUNTS.— 

11 ‘‘(A) IN GENERAL.—If the credit allowable 

12 under subsection (a) for a taxable year exceeds 

13 the limitation under paragraph (1) for such tax14 able year, such excess shall be allowed— 

15 ‘‘(i) as a credit carryback to each of 

16 the 13 taxable years preceding such year, 

17 and 

18 ‘‘(ii) as a credit carryforward to each 

19 of the 20 taxable years following such year. 

20 ‘‘(B) AMOUNT CARRIED TO EACH YEAR.— 

21 For purposes of this paragraph, rules similar to 

22 the rules of section 39(a)(2) shall apply. 

23 ‘‘(f) SPECIAL RULES.— 

24 ‘‘(1) REDUCTION IN BASIS.—For purposes of 

25 this subtitle, if a credit is allowed under this section 


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1 for any expenditure with respect to any property, the 

2 increase in the basis of such property which would 

3 (but for this paragraph) result from such expendi4 ture shall be reduced by the amount of the credit so 

5 allowed. 

6 ‘‘(2) INVESTMENTS AND PROPERTY OUTSIDE

7 THE UNITED STATES.—No credit shall be allowed 

8 under subsection (a) with respect to— 

9 ‘‘(A) any manufacturing facility which is 

10 located outside the United States, and 

11 ‘‘(B) any engineering integration or re12 search and development conducted outside the 

13 United States. 

14 ‘‘(3) AGGREGATION OF EXPENDITURES; ALLO15 CATIONS.—For purposes of this section, rules simi16 lar to the rules of paragraphs (1) and (2) of section 

17 41(f) shall apply. 

18 ‘‘(4) RECAPTURE.—The Secretary shall, by reg19 ulation, provide for recapturing the benefit of any 

20 credit allowable under subsection (a) with respect to 

21 any manufacturing facility which ceases to produce 

22 advanced technology motor vehicles or eligible com23 ponents. 

24 ‘‘(5) PUBLIC STATEMENT.— 


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1 ‘‘(A) IN GENERAL.—No credit shall be al2 lowed under subsection (a) for any taxable year 

3 unless the eligible taxpayer makes publicly 

4 available a statement describing the activities of 

5 the eligible taxpayer for which the credit is al6 lowed and the public benefits of such activities, 

7 including the estimated amount of any reduc8 tion in national oil consumption in future years 

9 as a result of such activities. 

10 ‘‘(B) TIME FOR PUBLICATION.—The state11 ment required under subparagraph (A) shall be 

12 made available not later than 90 days after the 

13 end of the taxable year for which the credit 

14 under subsection (a) is allowed and shall be in 

15 such form as the Secretary shall prescribe. 

16 ‘‘(6) NO DOUBLE BENEFIT.— 

17 ‘‘(A) COORDINATION WITH OTHER DEDUC18 TIONS AND CREDITS.—Except as provided in 

19 subparagraph (B), the amount of any deduction 

20 or other credit allowable under this chapter for 

21 any cost taken into account in determining the 

22 amount of the credit under subsection (a) shall 

23 be reduced by the amount of such credit attrib24 utable to such cost. 


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1 ‘‘(B) RESEARCH AND DEVELOPMENT

2 COSTS.— 

3 ‘‘(i) IN GENERAL.—Except as pro4 vided in clause (ii), any amount described 

5 in subsection (b)(1)(A)(ii) taken into ac6 count in determining the amount of the 

7 credit under subsection (a) for any taxable 

8 year shall not be taken into account for 

9 purposes of determining the credit under 

10 section 41 for such taxable year. 

11 ‘‘(ii) COSTS TAKEN INTO ACCOUNT IN

12 DETERMINING BASE PERIOD RESEARCH

13 EXPENSES.—Any amounts described in 

14 subsection (b)(1)(A)(ii) taken into account 

15 in determining the amount of the credit 

16 under subsection (a) for any taxable year 

17 which are qualified research expenses 

18 (within the meaning of section 41(b)) shall 

19 be taken into account in determining base 

20 period research expenses for purposes of 

21 applying section 41 to subsequent taxable 

22 years. 

23 ‘‘(g) ELECTION NOT TO TAKE CREDIT.—No credit 

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


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

2 property. 

3 ‘‘(h) REGULATIONS.—The Secretary shall prescribe 

4 such regulations as necessary to carry out the provisions 

5 of this section.’’. 

6 (b) CONFORMING AMENDMENTS.— 

7 (1) Section 1016(a) of the Internal Revenue 

8 Code of 1986, as amended by this Act, is amended 

9 by striking ‘‘and’’ at the end of paragraph (38), by 

10 striking the period at the end of paragraph (39) and 

11 inserting ‘‘, and’’, and by adding at the end the fol12 lowing new paragraph: 

13 ‘‘(40) to the extent provided in section 

14 30D(f)(1).’’. 

15 (2) Section 6501(m) of such Code is amended 

16 by inserting ‘‘30D(g),’’ after ‘‘30C(e)(5),’’. 

17 (3) The table of sections for subpart B of part 

18 IV of subchapter A of chapter 1 of such Code is 

19 amended by inserting after the item relating to sec20 tion 30C the following new item: 

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

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

22 this section shall apply to amounts incurred in taxable 

23 years beginning after December 31, 1993. 


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1 Subtitle D—Realizing a Hydrogen 

2 Future 

3 SEC. 521. H-PRIZE COMPETITION. 

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

5 ‘‘H-Prize Act of 2006’’. 

6 (b) DEFINITIONS.—In this section: 

7 (1) ADMINISTERING ENTITY.—The term ‘‘ad8 ministering entity’’ means the entity with which the 

9 Secretary enters into an agreement under subsection 

10 (c)(3). 

11 (2) DEPARTMENT.—The term ‘‘Department’’ 

12 means the Department of Energy. 

13 (3) SECRETARY.—The term ‘‘Secretary’’ means 

14 the Secretary of Energy. 

15 (c) PRIZE AUTHORITY.— 

16 (1) IN GENERAL.—The Secretary shall carry 

17 out a program to competitively award cash prizes 

18 only in conformity with this section to advance the 

19 research, development, demonstration, and commer20 cial application of hydrogen energy technologies. 

21 (2) ADVERTISING AND SOLICITATION OF COM22 PETITORS.— 

23 (A) ADVERTISING.—The Secretary shall 

24 widely advertise prize competitions to encourage 


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1 broad participation, including participation 

2 by— 

3 (i) individuals; 

4 (ii) institutions of higher education, 

5 including historically Black colleges and 

6 universities and other institutions serving 

7 minorities; and 

8 (iii) large and small businesses, in9 cluding businesses owned or controlled by 

10 socially and economically disadvantaged 

11 persons. 

12 (B) ANNOUNCEMENT THROUGH FEDERAL

13 REGISTER NOTICE.— 

14 (i) IN GENERAL.—The Secretary shall 

15 announce each prize competition by pub16 lishing a notice in the Federal Register. 

17 (ii) REQUIREMENTS.—The notice 

18 shall include a description of— 

19 (I) the subject of the competition; 

20 (II) the duration of the competi21 tion; 

22 (III) the eligibility requirements 

23 for participation in the competition; 

24 (IV) the process for participants 

25 to register for the competition; 


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1 (V) the amount of the prize; and 

2 (VI) the criteria for awarding the 

3 prize. 

4 (3) ADMINISTERING THE COMPETITIONS.— 

5 (A) IN GENERAL.—The Secretary shall 

6 enter into an agreement with a private, non7 profit entity to administer the prize competi8 tions, subject to this section. 

9 (B) DUTIES.—The duties of the admin10 istering entity under the agreement shall in11 clude— 

12 (i) advertising prize competitions and 

13 the results of the prize competitions; 

14 (ii) raising funds from private entities 

15 and individuals to pay for administrative 

16 costs and contribute to cash prizes; 

17 (iii) working with the Secretary to de18 velop the criteria for selecting winners in 

19 prize competitions, based on goals provided 

20 by the Secretary; 

21 (iv) determining, in consultation with 

22 the Secretary, the appropriate amount for 

23 each prize to be awarded; 


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1 (v) selecting judges in accordance with 

2 subsection (d)(4), using criteria developed 

3 in consultation with the Secretary; and 

4 (vi) preventing the unauthorized use 

5 or disclosure of the intellectual property, 

6 trade secrets, and confidential business in7 formation of registered participants. 

8 (4) FUNDING SOURCES.— 

9 (A) IN GENERAL.—Cash prizes under this 

10 section shall consist of funds appropriated 

11 under subsection (h) and any funds provided by 

12 the administering entity for the cash prizes (in13 cluding funds raised pursuant to paragraph 

14 (3)(B)). 

15 (B) OTHER FEDERAL AGENCIES.—The 

16 Secretary may accept funds from other Federal 

17 agencies for the cash prizes. 

18 (C) NO SPECIAL CONSIDERATION.—The 

19 Secretary may not give any special consider20 ation to any private sector entity or individual 

21 in return for a donation to the administering 

22 entity. 

23 (5) ANNOUNCEMENT OF PRIZES.— 

24 (A) IN GENERAL.—The Secretary may not 

25 issue a notice required by paragraph (2)(B) 


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1 until all the funds needed to pay out the an2 nounced amount of the prize have been appro3 priated or committed in writing by the admin4 istering entity. 

5 (B) INCREASE IN AMOUNT OF PRIZE.—The 

6 Secretary may increase the amount of a prize 

7 after an initial announcement is made under 

8 paragraph (2)(B) if— 

9 (i) notice of the increase is provided 

10 in the same manner as the initial notice of 

11 the prize; and 

12 (ii) the funds needed to pay out the 

13 announced amount of the increase have 

14 been appropriated or committed in writing 

15 by the administering entity. 

16 (d) PRIZE CATEGORIES.— 

17 (1) CATEGORIES.—The Secretary shall estab18 lish prizes for— 

19 (A) advancements in components or sys20 tems related to— 

21 (i) hydrogen production; 

22 (ii) hydrogen production from renew23 able sources; 

24 (iii) hydrogen storage; 

25 (iv) hydrogen distribution; and 


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1 (v) hydrogen utilization; 

2 (B) prototypes of hydrogen-powered vehi3 cles or other hydrogen-based products that best 

4 meet or exceed objective performance criteria, 

5 such as completion of a race over a certain dis6 tance or terrain or generation of energy at cer7 tain levels of efficiency; and 

8 (C) transformational changes in tech9 nologies for the distribution or production of 

10 hydrogen that meet or exceed far-reaching ob11 jective criteria that— 

12 (i) shall include minimal carbon emis13 sions; and 

14 (ii) may include cost criteria designed 

15 to facilitate the eventual market success of 

16 a winning technology. 

17 (2) AWARDS.— 

18 (A) ADVANCEMENTS.— 

19 (i) IN GENERAL.—To the extent per20 mitted under subsection (c)(5), the prizes 

21 authorized under paragraph (1)(A) shall be 

22 awarded biennially to the most significant 

23 advance made in each of the 4 subcat24 egories described in clauses (i) through (v) 

25 of paragraph (1)(A) since the submission 


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1 deadline of the previous prize competition 

2 in the same category under paragraph 

3 (1)(A) or the date of enactment of this 

4 Act, whichever is later, unless no such ad5 vance is significant enough to merit an 

6 award. 

7 (ii) MAXIMUM AMOUNT FOR SINGLE

8 PRIZE.—No single prize described in clause 

9 (i) may exceed $2,000,000. 

10 (iii) INSUFFICIENT TOTAL FUNDS.—If 

11 less than $4,000,000 is available for a 

12 prize competition under paragraph (1)(A), 

13 the Secretary may— 

14 (I) omit 1 or more subcategories; 

15 (II) reduce the amount of the 

16 prizes; or 

17 (III) not hold a prize competi18 tion. 

19 (B) PROTOTYPES.— 

20 (i) IN GENERAL.—To the extent per21 mitted under subsection (c)(5), prizes au22 thorized under paragraph (1)(B) shall be 

23 awarded biennially in alternate years from 

24 the prizes authorized under paragraph 

25 (1)(A). 


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1 (ii) TOTAL NUMBER OF PRIZES.—The 

2 Secretary may award no more than 1 prize 

3 under paragraph (1)(A) in each 2-year pe4 riod. 

5 (iii) MAXIMUM AMOUNT FOR SINGLE

6 PRIZE.—No single prize under this sub7 paragraph may exceed $8,000,000. 

8 (iv) INSUFFICIENT QUALIFIED EN9 TRIES.—If no registered participant meets 

10 the objective performance criteria estab11 lished pursuant to paragraph (3) for a 

12 competition under this subparagraph, the 

13 Secretary shall not award a prize. 

14 (C) TRANSFORMATIONAL TECH15 NOLOGIES.— 

16 (i) IN GENERAL.—To the extent per17 mitted under subsection (c)(5), the Sec18 retary shall announce 1 prize competition 

19 authorized under paragraph (1)(C) as soon 

20 as practicable after the date of enactment 

21 of this Act. 

22 (ii) AMOUNT OF PRIZE.—A prize of23 fered under this subparagraph shall— 

24 (I) be in an amount not less than 

25 $2,000,000; 


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1 (II) be paid to the winner in a 

2 lump sum; and 

3 (III) include an additional 

4 amount paid to the winner as a match 

5 for each dollar of non-Federal funding 

6 raised by the winner for the hydrogen 

7 technology beginning on the date the 

8 winner was named. 

9 (iii) MATCHING.— 

10 (I) IN GENERAL.—The match de11 scribed in clause (ii)(III) shall be pro12 vided until the earlier of— 

13 (aa) the date that is 3 years 

14 after the date the prize winner is 

15 named; or 

16 (bb) the date on which the 

17 full amount of the prize has been 

18 paid out. 

19 (II) ELECTION.—A prize winner 

20 may elect to have the match amount 

21 paid to another entity that is con22 tinuing the development of the win23 ning technology. 

24 (III) RULES.—The Secretary 

25 shall announce the rules for receiving 


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1 the match in the notice required by 

2 subsection (c)(2)(B). 

3 (iv) REQUIREMENTS.—The Secretary 

4 shall award a prize under this subpara5 graph only when a registered participant 

6 has met the objective criteria established 

7 for the prize pursuant to paragraph (3) 

8 and announced pursuant to subsection 

9 (c)(2)(B). 

10 (v) TOTAL AMOUNT OF FUNDS.— 

11 (I) FEDERAL FUNDS.—Not more 

12 than $20,000,000 in Federal funds 

13 may be used for the prize award 

14 under this subparagraph. 

15 (II) MATCHING FUNDS.—As a 

16 condition of entering into an agree17 ment under subsection (c)(3), the ad18 ministering entity shall seek to raise 

19 $40,000,000 in non-Federal funds to20 ward the matching award under this 

21 subparagraph. 

22 (3) CRITERIA.—In establishing the criteria re23 quired by this section, the Secretary shall consult 

24 with— 


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1 (A) the Hydrogen Technical and Fuel Cell 

2 Advisory Committee of the Department; 

3 (B) other Federal agencies, including the 

4 National Science Foundation; and 

5 (C) private organizations, including profes6 sional societies, industry associations, the Na7 tional Academy of Sciences, and the National 

8 Academy of Engineering. 

9 (4) JUDGES.— 

10 (A) IN GENERAL.—For each prize competi11 tion, the Secretary shall assemble a panel of 

12 qualified judges to select the 1 or more winners 

13 on the basis of the criteria established under 

14 paragraph (3). 

15 (B) INCLUSIONS.—Judges for each prize 

16 competition shall include individuals from out17 side the Department, including from the private 

18 sector. 

19 (C) PROHIBITIONS.—A judge may not— 

20 (i) have personal or financial interests 

21 in, or be an employee, officer, director, or 

22 agent of, any entity that is a registered 

23 participant in the prize competition for 

24 which the judge will serve as a judge; or 


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1 (ii) have a familial or financial rela2 tionship with an individual who is a reg3 istered participant in the prize competition 

4 for which the judge will serve as a judge. 

5 (e) ELIGIBILITY.—To be eligible to win a prize under 

6 this section, an individual or entity— 

7 (1) shall have complied with all the require8 ments in accordance with the Federal Register no9 tice required under subsection (c)(2)(B); 

10 (A) in the case of a private entity, shall be 

11 incorporated in and maintain a primary place of 

12 business in the United States; 

13 (B) in the case of an individual (whether 

14 participating singly or in a group), shall be a 

15 citizen of, or an alien lawfully admitted for per16 manent residence in, the United States; and 

17 (C) shall not be a Federal entity, a Federal 

18 employee acting within the scope of employ19 ment, or an employee of a national laboratory 

20 acting within the scope of employment. 

21 (f) INTELLECTUAL PROPERTY.— 

22 (1) IN GENERAL.—Subject to paragraph (2), 

23 the Federal Government shall not, by virtue of offer24 ing or awarding a prize under this section, be enti25 tled to any intellectual property rights derived as a 


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1 consequence of, or direct relation to, the participa2 tion by a registered participant in a competition au3 thorized by this section. 

4 (2) NEGOTIATION OF LICENSES PERMITTED.— 

5 This subsection does not prevent the Federal Gov6 ernment from negotiating a license for the use of in7 tellectual property developed for a prize competition 

8 under this section. 

9 (g) LIABILITY.— 

10 (1) WAIVER OF LIABILITY.— 

11 (A) IN GENERAL.—As a condition of par12 ticipation in a competition under this section, 

13 the Secretary may require registered partici14 pants to waive claims against the Federal Gov15 ernment and the administering entity (except 

16 claims for willful misconduct) for any injury, 

17 death, damage, or loss of property, revenue, or 

18 profits arising from the participation of the reg19 istered participants in a competition under this 

20 section. 

21 (B) NOTICE REQUIRED.—The Secretary 

22 shall provide notice of any waiver required 

23 under this paragraph in the notice required by 

24 subsection (c)(2)(B). 


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1 (C) PROHIBITION.—The Secretary may 

2 not require a registered participant to waive 

3 claims against the administering entity arising 

4 out of the unauthorized use or disclosure by the 

5 administering entity of the intellectual property, 

6 trade secrets, or confidential business informa7 tion of the registered participant. 

8 (2) LIABILITY INSURANCE.— 

9 (A) REQUIREMENTS.—As a condition of 

10 participation in a competition under this sec11 tion, a registered participant shall be required 

12 to obtain liability insurance or demonstrate fi13 nancial responsibility, in amounts determined 

14 by the Secretary, for claims by— 

15 (i) a third party for death, bodily in16 jury, or property damage or loss resulting 

17 from an activity carried out in connection 

18 with participation in a competition under 

19 this section; and 

20 (ii) the Federal Government for dam21 age or loss to Government property result22 ing from such an activity. 

23 (B) FEDERAL GOVERNMENT INSURED.— 

24 (i) IN GENERAL.—The Federal Gov25 ernment shall be named as an additional 


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1 insured under the insurance policy of a 

2 registered participant required under sub3 paragraph (A)(i). 

4 (ii) MANDATORY INDEMNIFICATION.— 

5 As a condition of participation in a com6 petition under this section, a registered 

7 participant shall be required to agree to in8 demnify the Federal Government against 

9 third party claims for damages arising 

10 from or related to competition activities. 

11 (h) AUTHORIZATION OF APPROPRIATIONS.— 

12 (1) AUTHORIZATION OF APPROPRIATIONS.— 

13 (A) AWARDS.—There are authorized to be 

14 appropriated to the Secretary to carry out this 

15 section for the period of fiscal years 2007 

16 through 2016— 

17 (i) $20,000,000 for awards described 

18 in subsection (d)(1)(A); 

19 (ii) $20,000,000 for awards described 

20 in subsection (d)(1)(B); and 

21 (iii) $10,000,000 for the award de22 scribed in subsection (d)(1)(C). 

23 (B) ADMINISTRATION.—In addition to the 

24 amounts authorized in subparagraph (A), there 

25 are authorized to be appropriated to the SecVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00281 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 retary for the administrative costs of carrying 

2 out this section $2,000,000 for each of fiscal 

3 years 2007 through 2016. 

4 (2) CARRYOVER OF FUNDS.— 

5 (A) IN GENERAL.—Funds appropriated for 

6 prize awards under this section— 

7 (i) shall remain available until ex8 pended; and 

9 (ii) may be transferred, repro10 grammed, or expended for other purposes 

11 only after the expiration of 10 fiscal years 

12 after the fiscal year for which the funds 

13 were originally appropriated. 

14 (B) RELATION TO OTHER LAW.—No provi15 sion in this section permits obligation or pay16 ment of funds in violation of section 1341 of 

17 title 31, United States Code (commonly known 

18 as the ‘‘Anti-Deficiency Act’’). 

19 (i) MAINTENANCE OF EFFORT.—The Secretary shall 

20 ensure that funds provided under this section will be used 

21 only to supplement, and not to supplant, Federal research 

22 and development programs. 

23 (j) SUNSET.—The authority provided by this section 

24 shall terminate on September 30, 2017. 


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1 SEC. 522. CREDIT FOR RETAIL SALE OF HYDROGEN FUEL 

2 AS MOTOR VEHICLE FUEL. 

3 (a) IN GENERAL.—Subpart D of part IV of sub4 chapter A of chapter 1 of the Internal Revenue Code of 

5 1986 (relating to business related credits), as amended by 

6 this Act, is amended by inserting after section 45O the 

7 following new section: 

8 ‘‘SEC. 45P. CREDIT FOR RETAIL SALE OF HYDROGEN AS 

9 MOTOR VEHICLE FUEL. 

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

11 the hydrogen fuel retail sales credit for any taxable year 

12 is an amount equal to the greater of— 

13 ‘‘(1) 20 percent of the price of hydrogen, or 

14 ‘‘(2) 50 cents for each quantity of hydrogen 

15 having a Btu content of 115,000, sold at retail by 

16 the taxpayer during such year as a fuel to propel 

17 any hydrogen fuel cell vehicle. 

18 ‘‘(b) DEFINITIONS.—For purposes of this section— 

19 ‘‘(1) HYDROGEN FUEL CELL VEHICLE.—The 

20 term ‘hydrogen fuel cell vehicle’ has the meaning 

21 given such term in section 136A. 

22 ‘‘(2) SOLD AT RETAIL.— 

23 ‘‘(A) IN GENERAL.—The term ‘sold at re24 tail’ means the sale, for a purpose other than 

25 resale, after manufacture, production, or impor26 tation. 


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1 ‘‘(B) USE TREATED AS SALE.—If any per2 son uses hydrogen (including any use after im3 portation) as a fuel to propel any motor vehicle 

4 (as defined in section 30(c)(2)) before such fuel 

5 is sold at retail, then such use shall be treated 

6 in the same manner as if such fuel were sold 

7 at retail as a fuel to propel such a vehicle by 

8 such person. 

9 ‘‘(c) PASS-THRU IN THE CASE OF ESTATES AND

10 TRUSTS.—Under regulations prescribed by the Secretary, 

11 rules similar to the rules of subsection (d) of section 52 

12 shall apply. 

13 ‘‘(d) TERMINATION.—This section shall not apply to 

14 any fuel sold at retail after December 31, 2014.’’. 

15 (b) CREDIT TREATED AS BUSINESS CREDIT.—Sec16 tion 38(b) of the Internal Revenue Code of 1986, as 

17 amended by this Act, is amended by striking ‘‘plus’’ at 

18 the end of paragraph (31), by striking the period at the 

19 end of paragraph (32) and inserting ‘‘, plus’’, and by add20 ing at the end the following new paragraph: 

21 ‘‘(33) the hydrogen fuel retail sales credit deter22 mined under section 45P(a).’’. 

23 (c) CLERICAL AMENDMENT.—The table of sections 

24 for subpart D of part IV of subchapter A of chapter 1 

25 of the Internal Revenue Code of 1986, as amended by this 


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1 Act, is amended by inserting after the item relating to sec2 tion 45O the following new item: 

‘‘Sec. 45P. Credit for retail sale of hydrogen as motor vehicle fuel.’’. 

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

4 this section shall apply to fuel sold at retail after Decem5 ber 31, 2005, in taxable years ending after such date. 

6 SEC. 523. CREDIT FOR PRODUCTION OF HYDROGEN FUEL. 

7 (a) HYDROGEN PRODUCED FROM ANY SOURCE.— 

8 Section 45K of the Internal Revenue Code of 1986 (relat9 ing to credit for producing fuel from nonconventional 

10 sources) is amended by adding at the end the following 

11 new subsection: 

12 ‘‘(h) HYDROGEN FUEL.— 

13 ‘‘(1) HYDROGEN FUEL PRODUCED FROM ANY

14 SOURCE.—There shall be allowed as a credit against 

15 the tax imposed by this chapter for the taxable year 

16 an amount equal to— 

17 ‘‘(A) $10, multiplied by 

18 ‘‘(B) each quantity of hydrogen having a 

19 Btu content of 5,800,000— 

20 ‘‘(i) sold by the taxpayer to an unre21 lated person during the taxable year, and 

22 ‘‘(ii) the production of which is attrib23 utable to the taxpayer. 

24 ‘‘(2) ADDITIONAL CREDIT FOR PRODUCTION

25 FROM RENEWABLE SOURCES.— 


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1 ‘‘(A) IN GENERAL.—In the case of hydro2 gen which is produced from a renewable source, 

3 paragraph (1)(A) shall be applied by sub4 stituting ‘$20’ for ‘$10’. 

5 ‘‘(B) RENEWABLE SOURCE.— 

6 ‘‘(i) IN GENERAL.—The term ‘renew7 able source’ means solar, wind, ocean, geo8 thermal energy, biomass, landfill gas, or 

9 incremental hydropower. 

10 ‘‘(ii) INCREMENTAL HYDROPOWER.— 

11 The term ‘incremental hydropower’ means 

12 additional generating capacity achieved 

13 from increased efficiency or additions of 

14 new capacity at a hydroelectric facility in 

15 existence on the date of enactment of this 

16 paragraph. 

17 ‘‘(3) EXCLUSION ON SALE FOR CERTAIN

18 USES.—No credit shall be allowed under this sub19 section for hydrogen fuel sold by the taxpayer the 

20 use of which is for the production or refining of 

21 other petroleum products. 

22 ‘‘(4) TERMINATION.—This subsection shall not 

23 apply to hydrogen fuel produced after December 31, 

24 2014.’’. 


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

2 this section shall apply to hydrogen produced after Decem3 ber 31, 2005, in taxable years ending after such date. 

4 SEC. 524. TAX HOLIDAY FOR HYDROGEN FUEL. 

5 (a) IN GENERAL.—Subchapter B of chapter 65 of the 

6 Internal Revenue Code of 1986 (relating to abatements, 

7 credits, and refunds) is amended by adding at the end the 

8 following new section: 

9 ‘‘SEC. 6431. FUELS USED IN HYDROGEN POWERED VEHI10 CLES. 

11 ‘‘(a) IN GENERAL.—If any fuel taxable under section 

12 4041 or 4081 is used to produce hydrogen as a means 

13 of propelling a hydrogen fuel cell vehicle during the appli14 cable period, the Secretary shall pay (without interest) to 

15 the ultimate purchaser of such fuel an amount equal to 

16 the amount determined by multiplying the number of gal17 lons so used by the rate at which tax was imposed on such 

18 fuel under section 4041 or 4081. 

19 ‘‘(b) APPLICABLE PERIOD.—The term ‘applicable pe20 riod’ means the period beginning after the date of the en21 actment of this section and ending before January 1, 

22 2014. 

23 ‘‘(c) HYDROGEN FUEL CELL VEHICLE.—The term 

24 ‘hydrogen fuel cell vehicle’ has the meaning given such 

25 term by section 136A(b)(1).’’. 


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1 (b) CONFORMING AMENDMENT.—The table of sec2 tions for subchapter B of chapter 65 of the Internal Rev3 enue Code of 1986 is amended by inserting after the item 

4 relating to section 6428 the following new item: 

‘‘Sec. 6431. Fuels used in hydrogen powered vehicles.’’. 

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

6 this section shall apply to fuel produced after the date of 

7 the enactment of this Act. 

8 SEC. 525. SENSE OF CONGRESS REGARDING HYDROGEN 

9 FUEL TAXES. 

10 It is the sense of Congress that no tax should be im11 posed on hydrogen fuel before January 1, 2014. 

12 SEC. 526. HYDROGEN FUELING FRINGE BENEFIT. 

13 (a) IN GENERAL.—Paragraph (1) of section 132(c) 

14 of the Internal Revenue Code of 1986 (relating to quali15 fied employee discounts) is amended by striking ‘‘or’’ at 

16 the end of subparagraph (A), by striking the period and 

17 inserting ‘‘, or’’ at the end of subparagraph (B), and by 

18 adding at the end the following new subparagraph: 

19 ‘‘(C) in the case of hydrogen fuel, 50 per20 cent of the price at which such fuel is being of21 fered by the employer to customers.’’. 

22 (b) 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 SEC. 527. EXCLUSION OF EARNINGS FROM HYDROGEN 

2 FUEL SALES. 

3 (a) IN GENERAL.—Part III of subchapter B of chap4 ter 1 of the Internal Revenue Code of 1986 (relating to 

5 items specifically excluded from gross income) is amended 

6 by inserting after section 136 the following new section: 

7 ‘‘SEC. 136A. INCOME FROM HYDROGEN FUEL SALES. 

8 ‘‘(a) EXCLUSION.—Gross income shall not include in9 come attributable to the sale of hydrogen fuel sold for use 

10 in a hydrogen fuel cell vehicle. 

11 ‘‘(b) HYDROGEN FUEL CELL VEHICLE.—For pur12 poses of this section, the term ‘hydrogen fuel cell vehicle’ 

13 means a motor vehicle (as defined in section 30(c)(2)) 

14 which is propelled by power derived from 1 or more cells 

15 which convert chemical energy directly into electricity by 

16 combining oxygen with hydrogen fuel which is stored on 

17 board the vehicle in any form and may or may not require 

18 reformation prior to use. 

19 ‘‘(c) TERMINATION.—This section shall not apply to 

20 income attributable to sales after December 31, 2014.’’. 

21 (b) CONFORMING AMENDMENT.—The table of sec22 tions for subpart B of part III of subchapter B of chapter 

23 1 of the Internal Revenue Code of 1986 is amended by 

24 inserting after the item relating to section 136 the fol25 lowing new item: 

‘‘Sec. 136A. Income from hydrogen fuel sales.’’. 


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1 (c) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to income received after December 

3 31, 2005, in taxable years ending after such date. 

4 Subtitle E—Building the Skilled 

5 Workforce for Advanced Vehicle 

6 and Energy Technology Deploy7 ment 

8 SEC. 531. INCREASING SKILLED WORKFORCE. 

9 (a) DEFINITIONS.—In this section: 

10 (1) ADMINISTRATOR.—The term ‘‘Adminis11 trator’’ means the Administrator of the Environ12 mental Protection Agency. 

13 (2) CENTER OF EXCELLENCE.—The term ‘‘cen14 ter of excellence’’ means a facility established by an 

15 eligible entity at which 1 or more qualifying pro16 grams are or will be carried out. 

17 (3) ELIGIBLE ENTITY.—The term ‘‘eligible enti18 ty’’ means— 

19 (A) a Federal agency (other than the De20 partment of Energy); 

21 (B) a unit of State or local government; 

22 (C) an institution of higher education; and 

23 (D) a public elementary school or sec24 ondary school. 


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1 (4) QUALIFYING PROGRAM.—The term ‘‘quali2 fying program’’ means a continuing education pro3 gram, or any other education or training program, 

4 that is— 

5 (A) carried out by an institution or organi6 zation certified under subsection (d); and 

7 (B) designed to increase the skilled work8 force of the United States with respect to— 

9 (i) advanced vehicle manufacturing; 

10 (ii) alternative fuel vehicle repair and 

11 maintenance; or 

12 (iii) energy technology product devel13 opment and deployment. 

14 (5) SECRETARY.—The term ‘‘Secretary’’ means 

15 the Secretary of Energy. 

16 (b) CENTERS OF EXCELLENCE.— 

17 (1) ESTABLISHMENT.—The Secretary shall es18 tablish a program under which the Secretary shall 

19 provide grants to eligible entities to establish and 

20 operate or support centers of excellence in the juris21 diction of the eligible entity. 

22 (2) APPLICATION.—To be eligible to receive a 

23 grant under paragraph (1), an eligible entity shall— 

24 (A) submit to the Secretary an application 

25 at such time, in such manner, and containing 


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1 such information as the Secretary may require; 

2 and 

3 (B) enter into an agreement with the Sec4 retary relating to the establishment and oper5 ation or support of the center of excellence of 

6 the eligible entity. 

7 (3) AUTHORIZATION OF APPROPRIATIONS.— 

8 There is authorized to be appropriated to carry out 

9 this subsection $50,000,000 for each of fiscal years 

10 2007 through 2016. 

11 (c) TUITION REIMBURSEMENT.— 

12 (1) IN GENERAL.—The Secretary shall provide 

13 to any individual that participates in a qualifying 

14 program reimbursement in the amount of the tuition 

15 paid by the individual for the qualifying program. 

16 (2) APPLICATION.—To be eligible to receive re17 imbursement under this subsection, an individual 

18 that participates in a qualifying program shall sub19 mit to the Secretary an application at such time, in 

20 such manner, and containing such information as 

21 the Secretary may require. 

22 (d) CERTIFICATION PROCEDURE.—As soon as prac23 ticable after the date of enactment of this Act, the Sec24 retary, in coordination with the Secretary of Labor and 

25 the Administrator and in consultation with affected labor 


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1 unions, professional societies, academic institutions, and 

2 businesses, shall develop a procedure under which the Sec3 retary, the Secretary of Labor, and the Administrator 

4 shall jointly certify institutions and organizations to carry 

5 out qualifying programs. 

6 (e) TAX CREDITS.—The Secretary, in coordination 

7 with the Secretary of the Treasury, shall submit to Con8 gress proposed legislation to establish a tax credit for indi9 viduals, eligible entities, and institutions and organizations 

10 certified under subsection (d) for establishing, carrying 

11 out, or participating in qualifying programs or centers of 

12 excellence. 

13 SEC. 532. GRANT PROGRAM FOR GREEN BUILDING AND 

14 ZERO-ENERGY HOME DESIGN AND CON15 STRUCTION TRAINING. 

16 (a) IN GENERAL.—The Secretary of Education, in 

17 consultation with the Secretary of Energy, may award 

18 grants to postsecondary educational institutions to enable 

19 the institutions to train 10,000 individuals in green build20 ing and zero-energy home design and construction by fis21 cal year 2011. 

22 (b) APPLICATION.—A postsecondary educational in23 stitution that desires to receive a grant under this section 

24 shall submit an application to the Secretary of Education 

25 at such time, in such manner, and accompanied by such 


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1 information as the Secretary of Education may reasonably 

2 require. 

3 (c) REIMBURSEMENT.— 

4 (1) IN GENERAL.—A postsecondary educational 

5 institution that receives a grant under this section 

6 shall use the grant funds to reimburse an individual 

7 who completes training in zero-energy home design 

8 and construction at, and receives accreditation as a 

9 green building professional from, the institution for 

10 an amount that is not more than 50 percent of the 

11 amount the individual paid to receive the training at 

12 the institution. 

13 (2) DETERMINATION OF AMOUNT.—For pur14 poses of calculating the amount of the reimburse15 ment under paragraph (1), the amount the indi16 vidual paid to receive the training at the institution 

17 shall be reduced by the amount of any other grants 

18 received by the individual for the training. 

19 (3) EFFECT ON OTHER FEDERAL LOANS.—A 

20 reimbursement provided to an individual under para21 graph (1) shall not affect the eligibility of the indi22 vidual for other Federal loans, including student 

23 loans. 

24 (d) RENEWABLE ENERGY CERTIFICATION AND

25 TRAINING.—The Secretary of Energy, in consultation 


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1 with the Secretary of Education and the heads of other 

2 appropriate agencies, shall prepare and implement a plan 

3 for— 

4 (1) certifying renewable energy products and 

5 equipment; and 

6 (2) developing appropriate voluntary standards 

7 and training programs for renewable energy product 

8 and equipment installation and installers. 

9 (e) AUTHORIZATION OF APPROPRIATIONS.—There 

10 are authorized to be appropriated such sums as are nec11 essary to carry out this section. 

12 Subtitle F—Clean Energy 

13 Investment Administration 

14 SEC. 541. DEFINITIONS. 

15 In this subtitle: 

16 (1) ADMINISTRATOR.—The term ‘‘Adminis17 trator’’ means the Administrator of the CEIA ap18 pointed under section 542(b)(1)(A). 

19 (2) CEIA.—The term ‘‘CEIA’’ means the Clean 

20 Energy Investment Administration established by 

21 section 542(a)(1). 

22 (3) COMMERCIAL DEPLOYMENT PROJECT.—The 

23 term ‘‘commercial deployment project’’ means any 

24 project using commercial technology relating to any 

25 of the following: 


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1 (A) Renewable electric power systems 

2 based on wind, solar, biomass, or geothermal 

3 energy. 

4 (B) Component and subcomponent manu5 facturing and conversion of manufacturing fa6 cilities for production of renewable electric 

7 power systems based on wind, solar, biomass, or 

8 geothermal energy. 

9 (C) Efficient electrical generation, trans10 mission, and distribution technologies. 

11 (D) Efficient end-use electric power tech12 nologies. 

13 (4) COMMERCIAL TECHNOLOGY.—The term 

14 ‘‘commercial technology’’ means a technology dem15 onstrated as technologically and commercially viable 

16 in at least 1 commercial-scale prototype. 

17 (5) COST.—The term ‘‘cost’’ has the meaning 

18 given the term ‘‘cost of a loan guarantee’’ within the 

19 meaning of section 502(5)(C) of the Federal Credit 

20 Reform Act of 1990 (2 U.S.C. 661a(5)(C)). 

21 (6) DEMONSTRATION PROJECT.—The term 

22 ‘‘demonstration project’’ means any project using 

23 demonstration technology relating to any of the fol24 lowing: 


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1 (A) Renewable electric power systems 

2 based on wind, solar, biomass, or geothermal 

3 energy. 

4 (B) Component and subcomponent manu5 facturing for wind, solar, biomass, and geo6 thermal renewable energy systems. 

7 (C) Integrated gasification and combined8 cycle systems. 

9 (D) Hydrogen fuel cell technology for resi10 dential, industrial, or transportation applica11 tions. 

12 (E) Carbon capture and sequestration 

13 practices and technologies, including agricul14 tural and forestry practices that store and se15 quester carbon. 

16 (F) Efficient electrical generation, trans17 mission, and distribution technologies, including 

18 component and subcomponent manufacturing. 

19 (G) Efficient end-use energy technologies. 

20 (7) DEMONSTRATION TECHNOLOGY.—The term 

21 ‘‘demonstration technology’’ means a scientifically22 viable technology that has not yet been dem23 onstrated as a commercial scale prototype. 

24 (8) ELIGIBLE PROJECT.—The term ‘‘eligible 

25 project’’ means— 


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1 (A) a project described in section 544; 

2 (B) any demonstration project that em3 ploys new or significantly improved technologies 

4 as compared to commercial technologies in serv5 ices in the United States at the time at which 

6 the loan guarantee is issued, as determined by 

7 the Administrator; 

8 (C) any commercial deployment project 

9 that employs technologies that have been dem10 onstrated as viable in at least 1 commercial11 scale prototype, as determined by the Adminis12 trator; and 

13 (D) with respect to any demonstration 

14 project or commercial deployment project for 

15 which a loan guarantee is sought under this 

16 subsection, a project that— 

17 (i) avoids or reduces energy imports; 

18 (ii) creates jobs paying the prevailing 

19 wage for similar work in the region in 

20 which the project is located; or 

21 (iii) avoids, reduces, or sequesters air 

22 pollutants or anthropogenic emissions of 

23 greenhouse gases. 

24 (9) LOAN GUARANTEE.— 


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1 (A) IN GENERAL.—The term ‘‘loan guar2 antee’’ has the meaning given the term ‘‘loan 

3 guarantee’’ in section 502 of the Federal Credit 

4 Reform Act of 1990 (2 U.S.C. 661a). 

5 (B) INCLUSION.—The term ‘‘loan guar6 antee’’ includes a loan guarantee commitment 

7 (as defined in section 502 of the Federal Credit 

8 Reform Act of 1990 (2 U.S.C. 661a)). 

9 (10) OBLIGATION.—The term ‘‘obligation’’ 

10 means the loan or other debt obligation that is guar11 anteed under this section. 

12 (11) SUCCESS WARRANT.—The term ‘‘success 

13 warrant’’ means equity in clean energy ventures that 

14 are successful as a result of this Act. 

15 SEC. 542. CLEAN ENERGY INVESTMENT ADMINISTRATION. 

16 (a) ESTABLISHMENT.— 

17 (1) IN GENERAL.—There is established as an 

18 independent agency in the Executive branch an 

19 agency to be known as the ‘‘Clean Energy Invest20 ment Administration’’. 

21 (2) SUPERVISION AND AFFILIATION.—The 

22 CEIA— 

23 (A) shall be under the direction and super24 vision of the President; and 


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1 (B) shall not be affiliated with, or be with2 in, any other agency or department of the Fed3 eral Government. 

4 (b) MANAGEMENT.— 

5 (1) ADMINISTRATOR.— 

6 (A) IN GENERAL.—The CEIA shall be 

7 managed by an Administrator, who shall be a 

8 civilian appointed by the President, by and with 

9 the advice and consent of the Senate. 

10 (B) QUALIFICATIONS.—The Administrator 

11 of the CEIA shall be an individual of out12 standing qualifications known to be familiar 

13 with and sympathetic to— 

14 (i) clean energy technology; 

15 (ii) clean energy policy; and 

16 (iii) obstacles to development of clean 

17 energy. 

18 (C) CONFLICTS OF INTEREST.—The Ad19 ministrator shall not engage in any other busi20 ness, vocation, or employment than that of serv21 ing as Administrator. 

22 (D) DISCRIMINATION.—With respect to 

23 programs carried out by the CEIA— 

24 (i) in managing those programs, in25 cluding grantmaking and guaranteeing 


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1 programs and functions, the Administrator 

2 shall not discriminate on the basis of sex 

3 or marital status against any person or 

4 small business concern applying for or re5 ceiving assistance from the CEIA; and 

6 (ii) the CEIA shall give special consid7 eration to veterans of the Armed Forces of 

8 the United States and their survivors or 

9 dependents. 

10 (E) DEPUTY ADMINISTRATOR.—The Presi11 dent, by and with the advice and consent of the 

12 Senate, may appoint a Deputy Administrator to 

13 assist the Administrator in carrying out the du14 ties of the Administrator under this subtitle. 

15 SEC. 543. REQUIREMENTS SPECIFIC TO DEMONSTRATION 

16 PROJECTS AND COMMERCIAL DEPLOYMENT 

17 PROJECTS. 

18 (a) IN GENERAL.—The CEIA shall operate separate 

19 financing programs for eligible projects at the demonstra20 tion and commercial stages of development. 

21 (b) DEMONSTRATION PROJECTS.— 

22 (1) IN GENERAL.—Subject to paragraph (3) 

23 and section 534, the CEIA may provide to eligible 

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1 ing for demonstration projects in the form of grants, 

2 loan guarantees, or both. 

3 (2) USE OF FUNDS.—A recipient of a grant 

4 under this subsection may use funds from the grant 

5 to pay— 

6 (A) the costs of 1 or more loan guarantees 

7 for an eligible project; or 

8 (B) not more than 25 percent of the costs 

9 of an eligible project. 

10 (3) MAXIMUM AGGREGATE LOAN GUARAN11 TEES.—The aggregate amount of Federal loan guar12 antees that may be provided under this subtitle for 

13 demonstration projects shall not exceed 

14 $5,000,000,000. 

15 (4) MAXIMUM FUNDING PERCENTAGE FOR

16 DEMONSTRATION PROJECT CATEGORIES.—Not more 

17 than 25 percent of the grant funds and loan guaran18 tees provided under this subsection for a fiscal year 

19 may be provided to any single category of dem20 onstration project described in section 531(6). 

21 (5) SUCCESS WARRANTS.—The developer of a 

22 demonstration project under this subsection may 

23 provide to CEIA a success warrant that— 


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1 (A) is worth up to 10 percent of the value 

2 of Federal loan guarantees secured for the dem3 onstration project under this subsection; and 

4 (B) shall be used by the CEIA to finance 

5 future CEIA loan guarantees. 

6 (c) COMMERCIAL DEPLOYMENT PROJECTS.— 

7 (1) IN GENERAL.—The CEIA may provide as8 sistance for commercial deployment projects under 

9 this subtitle only in the form of loan guarantees. 

10 (2) MAXIMUM AGGREGATE LOAN GUARAN11 TEES.—The aggregate amount of loan guarantees 

12 that may be provided under this subtitle for com13 mercial deployment projects shall not exceed 

14 $20,000,000,000. 

15 SEC. 544. LOAN GUARANTEE PROGRAM. 

16 (a) IN GENERAL.—Except as provided in the Alaska 

17 Natural Gas Pipeline Act (15 U.S.C. 720 et seq.), the Ad18 ministrator shall make loan guarantees under this subtitle 

19 for eligible projects on such terms and conditions as the 

20 Administrator determines, after consultation with the Sec21 retary of the Treasury, to be appropriate and in accord22 ance with this section. 

23 (b) SPECIFIC APPROPRIATION OR CONTRIBUTION.— 


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1 (1) DEMONSTRATION PROJECTS.—No loan 

2 guarantee shall be made for a demonstration project 

3 unless— 

4 (A) an appropriation for the cost has been 

5 made; or 

6 (B) the Administrator has— 

7 (i) received from the borrower a pay8 ment in full for the cost of the obligation; 

9 and 

10 (ii) deposited the payment in the 

11 Treasury. 

12 (2) COMMERCIAL PROJECTS.—No loan guar13 antee shall be made for a commercial deployment 

14 project unless the Administrator has— 

15 (A) received from the borrower a payment 

16 in full for the cost of the obligation; and 

17 (B) deposited the payment in the Treas18 ury. 

19 (c) MAXIMUM AMOUNT.—Except as otherwise pro20 vided by law, a loan guarantee by the Administrator for 

21 a demonstration project or commercial deployment project 

22 shall not exceed an amount equal to 80 percent of the cost 

23 of the facility that is the subject of the loan guarantee, 

24 as estimated at the time at which the loan guarantee is 

25 issued. 


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1 (d) REPAYMENT.— 

2 (1) IN GENERAL.—No loan guarantee shall be 

3 made under this section unless the Administrator 

4 determines that there is a reasonable prospect of re5 payment by the borrower of the principal and inter6 est on the obligation covered by the loan guarantee. 

7 (2) SUFFICIENCY OF AMOUNT.—No loan guar8 antee shall be made under this section unless the 

9 Administrator determines that the amount of the ob10 ligation covered by the loan guarantee (when com11 bined with amounts available to the borrower from 

12 other sources) will be sufficient to carry out the eli13 gible project for which the loan guarantee is pro14 vided. 

15 (3) SUBORDINATION.—A loan guarantee pro16 vided under this section shall be subject to the con17 dition that the obligation covered by the loan guar18 antee is not subordinate to other financing. 

19 (e) INTEREST RATE.—An obligation covered by a 

20 loan guarantee under this section shall bear interest at 

21 a rate that does not exceed a level that the Administrator 

22 determines to be appropriate, taking into account the pre23 vailing rate of interest in the private sector for similar 

24 loans and risks. 


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1 (f) TERM.—The term of an obligation covered by a 

2 loan guarantee under this section shall require full repay3 ment over a period not to exceed the lesser of— 

4 (1) 30 years; or 

5 (2) 90 percent of the projected useful life of the 

6 physical asset to be financed by the obligation cov7 ered by the loan guarantee (as determined by the 

8 Administrator). 

9 (g) DEFAULTS.— 

10 (1) PAYMENT BY ADMINISTRATOR.— 

11 (A) IN GENERAL.—If a borrower defaults 

12 on an obligation covered by a loan guarantee 

13 under this section (as defined in regulations 

14 promulgated by the Administrator and specified 

15 in the loan guarantee contract), the holder of 

16 the loan guarantee shall have the right to de17 mand payment of the unpaid amount from the 

18 Administrator. 

19 (B) PAYMENT REQUIRED.—Within such 

20 period as may be specified in the loan guar21 antee or related agreements, the Administrator 

22 shall pay to the holder of the loan guarantee 

23 the unpaid interest on, and unpaid principal of 

24 the obligation as to which the borrower has de25 faulted, unless the Administrator finds that 


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1 there was no default by the borrower in the 

2 payment of interest or principal or that the de3 fault has been remedied. 

4 (C) FORBEARANCE.—Nothing in this sub5 section precludes any forbearance by the holder 

6 of an obligation covered by a loan guarantee 

7 under this section for the benefit of the bor8 rower, which forbearance may be agreed upon 

9 by the parties to the obligation and approved by 

10 the Administrator. 

11 (2) SUBROGATION.— 

12 (A) IN GENERAL.—If the Administrator 

13 makes a payment under paragraph (1), the Ad14 ministrator shall be subrogated to the rights of 

15 the recipient of the payment as specified in the 

16 loan guarantee or related agreements including, 

17 where appropriate, the authority (notwith18 standing any other provision of law)— 

19 (i) to complete, maintain, operate, 

20 lease, or otherwise dispose of any property 

21 acquired pursuant to the loan guarantee or 

22 related agreements; or 

23 (ii) to permit the borrower, pursuant 

24 to an agreement with the Administrator, to 

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1 gible project carried out as a result of the 

2 loan guarantee if the Administrator deter3 mines the pursuit to be in the public inter4 est. 

5 (B) SUPERIORITY OF RIGHTS.—The rights 

6 of the Administrator, with respect to any prop7 erty acquired pursuant to a loan guarantee or 

8 related agreements, shall be superior to the 

9 rights of any other person with respect to the 

10 property. 

11 (C) TERMS AND CONDITIONS.—A loan 

12 guarantee agreement shall include such detailed 

13 terms and conditions as the Administrator de14 termines to be appropriate— 

15 (i) to protect the interests of the 

16 United States in the case of default; and 

17 (ii) to have available all the patents 

18 and technology necessary for any person 

19 selected, including the Administrator, to 

20 complete and operate the eligible project 

21 carried out as a result of the loan guar22 antee. 

23 (3) PAYMENT OF PRINCIPAL AND INTEREST BY

24 ADMINISTRATOR.—With respect to any obligation 

25 guaranteed under this section, the Administrator 


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1 may enter into a contract to pay, and pay, holders 

2 of the obligation, for and on behalf of the borrower, 

3 from funds appropriated for that purpose, the prin4 cipal and interest payments that become due and 

5 payable on the unpaid balance of the obligation if 

6 the Administrator finds that— 

7 (A) the borrower is unable to meet the 

8 payments and is not in default; 

9 (B) it is in the public interest to permit 

10 the borrower to continue to pursue the purposes 

11 of the project; 

12 (C) the probable net benefit to the Federal 

13 Government in paying the principal and interest 

14 will be greater than that which would result in 

15 the event of a default; 

16 (D) the amount of the payment sought by 

17 the holders of the obligation does not exceed the 

18 amount of principal and interest that the bor19 rower is obligated to pay under the agreement 

20 being guaranteed; and 

21 (E) the borrower agrees to reimburse the 

22 Administrator for the payment (including inter23 est) on terms and conditions that are satisfac24 tory to the Administrator. 

25 (4) ACTION BY ATTORNEY GENERAL.— 


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1 (A) NOTIFICATION.—If a borrower de2 faults on an obligation covered by a loan guar3 antee under this section, the Administrator 

4 shall notify the Attorney General of the default. 

5 (B) RECOVERY.—On notification, the At6 torney General shall take such action as is ap7 propriate to recover the unpaid principal and 

8 interest due from— 

9 (i) such assets of the defaulting bor10 rower as are associated with the obligation; 

11 or 

12 (ii) any other security pledged to se13 cure the obligation. 

14 (h) FEES.— 

15 (1) IN GENERAL.—The Administrator shall 

16 charge and collect fees for loan guarantees in 

17 amounts the Administrator determines are sufficient 

18 to cover applicable administrative expenses. 

19 (2) AVAILABILITY.—Fees collected under this 

20 subsection shall— 

21 (A) be deposited by the Administrator in 

22 the Treasury; and 

23 (B) remain available until expended, sub24 ject to such other conditions as are contained in 

25 annual appropriations Acts. 


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1 (i) RECORDS; AUDITS.— 

2 (1) IN GENERAL.—A recipient of a loan guar3 antee shall keep such records and other pertinent 

4 documents as the Administrator shall prescribe by 

5 regulation, including such records as the Adminis6 trator may require to facilitate an effective audit. 

7 (2) ACCESS.—The Administrator and the 

8 Comptroller General of the United States (or des9 ignees) shall have access, for the purpose of audit, 

10 to the records and other pertinent documents. 

11 (j) FULL FAITH AND CREDIT.—The full faith and 

12 credit of the United States is pledged to the payment of 

13 all loan guarantees issued under this section with respect 

14 to principal and interest. 

15 (k) QUALIFICATION OF FACILITIES RECEIVING TAX

16 CREDITS.—A project that receives 1 or more tax credits 

17 shall not be disqualified from being considered to be an 

18 eligible project, or from receiving a grant or loan guar19 antee, under this subtitle. 

20 SEC. 545. ENERGY PARK TASK FORCES. 

21 (a) DEFINITIONS.—In this section: 

22 (1) ENERGY PARK.—The term ‘‘energy park’’ 

23 shall have such meaning as is given the term by the 

24 Secretary, by regulation. 


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1 (2) SECRETARY.—The term ‘‘Secretary’’ means 

2 the Secretary of Energy. 

3 (3) TASK FORCE.—The term ‘‘task force’’ 

4 means any energy park task force established under 

5 subsection (b)(1). 

6 (b) ESTABLISHMENT.— 

7 (1) IN GENERAL.—As soon as practicable after 

8 the date of enactment of this Act, the Secretary 

9 shall establish not less than 4, and not more than 

10 6, regional task forces, to be known as ‘‘energy park 

11 task forces’’. 

12 (2) LOCATIONS.—The Secretary shall establish 

13 task forces under paragraph (1), to the maximum 

14 extent practicable— 

15 (A) in geographically diverse regions of the 

16 United States; and 

17 (B) in regions with— 

18 (i) well-established infrastructure for 

19 high-rank and low-rank coal or biomass 

20 production; or 

21 (ii) significant demand for the prod22 ucts of energy parks. 

23 (c) MEMBERSHIP.—Each task force shall be com24 prised of individuals, to be appointed by the Secretary, 

25 representing— 


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1 (1) local agricultural, coal, pulp and paper, 

2 chemical, automotive, and electric power industries, 

3 including distributed and renewable energy elec4 tricity companies where applicable ; 

5 (2) regional energy cooperatives; 

6 (3) State energy, environmental, agricultural, 

7 and economic development agencies; 

8 (4) labor unions; and 

9 (5) environmental and citizen groups. 

10 (d) DUTIES.— 

11 (1) EVALUATIONS.— 

12 (A) IN GENERAL.—Each task force shall 

13 evaluate, within the jurisdiction of the task 

14 force— 

15 (i) the technical and economic poten16 tial for the use of domestically-produced 

17 coal and biomass and available renewable 

18 energy resources as feedstock for energy 

19 parks to produce useful products for mar20 kets associated with— 

21 (I) fertilizer; 

22 (II) liquid fuels; 

23 (III) steam; and 

24 (IV) electricity; and 


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1 (ii) the impacts of the markets de2 scribed in clause (i) on— 

3 (I) national security; 

4 (II) the United States and re5 gional economies; 

6 (III) job security and unemploy7 ment; 

8 (IV) the environment; and 

9 (V) any other relevant industry. 

10 (B) INCLUSION.—An evaluation under sub11 paragraph (A) shall include an evaluation, with12 in the jurisdiction of the applicable task force, 

13 of carbon management options and costs. 

14 (2) REPORTS.— 

15 (A) IN GENERAL.—Not later than 18 

16 months after the date on which all members of 

17 a task force have been appointed under sub18 section (c), the task force shall submit to the 

19 Secretary a report describing the results of the 

20 evaluation conducted under paragraph (1). 

21 (B) COORDINATION.—In preparing a re22 port under subparagraph (A), a task force shall 

23 coordinate with— 

24 (i) the 7 Regional Carbon Sequestra25 tion Partnerships; and 


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1 (ii) other relevant Federal agencies. 

2 (e) ACTION BY SECRETARY.—After taking into con3 sideration the reports submitted under subsection (d)(2), 

4 including any related report submitted by an entity de5 scribed in subsection (d)(2)(B), the Secretary shall submit 

6 to Congress a report proposing a national energy park de7 velopment program, including any applicable recommenda8 tions of the Secretary. 

9 SEC. 546. AUTHORIZATION OF APPROPRIATIONS. 

10 There is authorized to be appropriated— 

11 (1) section 544 $2,000,000,000 for each of fis12 cal years 2007 through 2011, of which— 

13 (A) not less than $1,000,000,000 shall be 

14 used for grants for demonstration projects; and 

15 (B) not less than $1,000,000,000 shall be 

16 used for loan guarantees; and 

17 (2) this subtitle (other than section 544) such 

18 sums as are necessary for each of fiscal years 2007 

19 through 2011. 

20 Subtitle G—Strategic Gasoline and 

21 Fuel Reserve 

22 SEC. 548. STRATEGIC GASOLINE AND FUEL RESERVE. 

23 (a) IN GENERAL.—Title I of the Energy Policy and 

24 Conservation Act is amended by inserting after part D (42 

25 U.S.C. 6250 et seq.) the following: 


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1 ‘‘PART V—STRATEGIC GASOLINE AND FUEL 

2 RESERVE 

3 ‘‘SEC. 191. DEFINITIONS. 

4 ‘‘In this part: 

5 ‘‘(1) GASOLINE.—The term ‘gasoline’ means 

6 any finished petroleum product or blendstock used 

7 as non-diesel automotive fuel as determined by the 

8 Secretary to have the highest fungibility in the se9 lected region. 

10 ‘‘(2) RESERVE.—The term ‘Reserve’ means the 

11 Strategic Gasoline and Fuel Reserve established 

12 under section 192(a). 

13 ‘‘SEC. 192. ESTABLISHMENT. 

14 ‘‘(a) IN GENERAL.—Notwithstanding any other pro15 vision of this Act, the Secretary shall establish, maintain, 

16 and operate a Strategic Gasoline and Fuel Reserve. 

17 ‘‘(b) NOT COMPONENT OF STRATEGIC PETROLEUM

18 RESERVE.—The Reserve is not a component of the Stra19 tegic Petroleum Reserve established under part B. 

20 ‘‘(c) CAPACITY.—The Reserve shall contain at 

21 least— 

22 ‘‘(1) 8,000,000 barrels of gasoline; and 

23 ‘‘(2) 1,500,000 barrels of jet fuel. 

24 ‘‘(d) RESERVE SITES.— 

25 ‘‘(1) SITING.—Not later than 18 months after 

26 the date of enactment of this Act, the Secretary 


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1 shall determine not less than 3 Reserve sites, and 

2 not more than 5 Reserve sites, throughout the 

3 United States that are regionally strategic. 

4 ‘‘(2) OPERATION.—The Reserve sites described 

5 in paragraph (1) shall be operational not later than 

6 3 years after the date of enactment of this Act. 

7 ‘‘(e) AUTHORITY.—In carrying out this part, the Sec8 retary may— 

9 ‘‘(1) construct, purchase, contract for, lease, or 

10 otherwise acquire, in whole or in part, storage and 

11 related facilities and storage services; 

12 ‘‘(2) use, lease, maintain, sell, or otherwise dis13 pose of storage and related facilities acquired under 

14 this part; 

15 ‘‘(3) acquire by purchase, exchange, lease, com16 mercial futures contract, or other means gasoline 

17 and fuel for storage in the Reserve; 

18 ‘‘(4) store gasoline and fuel in facilities not 

19 owned by the United States; and 

20 ‘‘(5) sell, exchange, or otherwise dispose of gas21 oline and fuel from the Reserve, including to main22 tain— 

23 ‘‘(A) the quality or quantity of the gasoline 

24 or fuel in the Reserve; or 


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1 ‘‘(B) the operational capacity of the Re2 serve. 

3 ‘‘(f) FILL DATE.— 

4 ‘‘(1) IN GENERAL.—Except as provided in para5 graph (2), the Secretary shall complete the process 

6 of filling the Reserve under this section by March 1, 

7 2010. 

8 ‘‘(2) EXTENSIONS.—The Secretary may extend 

9 the due date established under paragraph (1) if the 

10 Secretary determines that filling the Reserve by that 

11 due date would cause— 

12 ‘‘(A) a significant price increase or supply 

13 shortage; and 

14 ‘‘(B) an undue economic burden on the 

15 United States. 

16 ‘‘SEC. 193. RELEASE OF GASOLINE AND FUEL. 

17 ‘‘(a) IN GENERAL.—The Secretary shall release gaso18 line or fuel from the Reserve only if— 

19 ‘‘(1) the Secretary finds that there is a severe 

20 fuel supply disruption by determining that— 

21 ‘‘(A) a regional, national, or international 

22 supply shortage of gasoline or fuel of significant 

23 scope and duration has occurred; 

24 ‘‘(B) a substantial increase in the price of 

25 gasoline or fuel has resulted from the shortage; 


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1 ‘‘(C) the price increase is likely to cause a 

2 significant adverse impact on the national or re3 gional economy; and 

4 ‘‘(D) releasing gasoline or fuel from the 

5 Reserve would assist directly and significantly 

6 in reducing the adverse impact of the shortage; 

7 or 

8 ‘‘(2)(A) the Governor of a State submits to the 

9 Secretary a written request for a release from the 

10 Reserve that contains a finding that— 

11 ‘‘(i) a regional or statewide supply short12 age of gasoline or fuel of significant scope and 

13 duration has occurred; 

14 ‘‘(ii) a substantial increase in the price of 

15 gasoline or fuel has resulted from the shortage; 

16 and 

17 ‘‘(iii) the price increase is likely to cause a 

18 significant adverse impact on the economy of 

19 the State; and 

20 ‘‘(B) the Secretary concurs with the findings of 

21 the Governor under subparagraph (A) and deter22 mines that a release from the Reserve— 

23 ‘‘(i) would mitigate gasoline or fuel price 

24 volatility in the State or region; and 


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1 ‘‘(ii) would not have an adverse effect on 

2 the long-term economic viability of retail gaso3 line or fuel markets in the State and adjacent 

4 States. 

5 ‘‘(b) PROCEDURE.— 

6 ‘‘(1) RESPONSE OF SECRETARY.—The Sec7 retary shall respond to a request submitted under 

8 subsection (a)(2) not later than 5 days after receipt 

9 of the request by— 

10 ‘‘(A) approving the request; 

11 ‘‘(B) denying the request; or 

12 ‘‘(C) requesting additional supporting in13 formation. 

14 ‘‘(2) RELEASE.—The Secretary shall establish 

15 procedures governing the release of gasoline or fuel 

16 from the Reserve in accordance with this subsection. 

17 ‘‘(3) REQUIREMENTS.— 

18 ‘‘(A) ELIGIBLE ENTITY.—In this para19 graph, the term ‘eligible entity’ means an entity 

20 that is customarily engaged in the sale or dis21 tribution or bulk storage of gasoline or fuel. 

22 ‘‘(B) SALE OR DISPOSAL FROM RE23 SERVE.—The procedures established under this 

24 subsection shall provide that the Secretary 

25 may— 


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1 ‘‘(i) sell gasoline or fuel from the Re2 serve to an eligible entity through a com3 petitive process; or 

4 ‘‘(ii) enter into an exchange agree5 ment with an eligible entity under which 

6 the Secretary receives— 

7 ‘‘(I) a greater volume of gasoline 

8 or fuel as repayment from the eligible 

9 entity than the volume provided to the 

10 eligible entity; or 

11 ‘‘(II) payment of the premium 

12 for the loan in cash, which may be 

13 placed in the Strategic Gasoline and 

14 Fuel Reserve Fund established under 

15 section 195. 

16 ‘‘(C) TEST SALE AUTHORITY.—The Sec17 retary may perform a test sale under this para18 graph for up to 1,000,000 barrels. 

19 ‘‘(c) CONTINUING EVALUATION.—The Secretary 

20 shall conduct a continuing evaluation of the drawdown and 

21 sales procedures established under this section. 

22 ‘‘SEC. 194. REPORTS. 

23 ‘‘(a) GASOLINE AND FUEL.—Not later than 180 days 

24 after the date of enactment of this section, the Secretary 

25 shall submit to Congress and the President a plan describVerDate Aug 31 2005 00:02 May 23, 2006 Jkt 049200 PO 00000 Frm 00321 Fmt 6652 Sfmt 6201 E:\BILLS\S2829.IS S2829

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1 ing the manner in which the Department of Energy will 

2 perform— 

3 ‘‘(1) the acquisition of storage and related fa4 cilities or storage services for the Reserve, including 

5 the use of storage facilities not currently in use or 

6 not currently used to capacity; 

7 ‘‘(2) the acquisition of gasoline and fuel for 

8 storage in the Reserve; 

9 ‘‘(3) the anticipated methods of disposition of 

10 gasoline and fuel from the Reserve; 

11 ‘‘(4) the estimated costs of establishment, main12 tenance, and operation of the Reserve; 

13 ‘‘(5) efforts that the Department will take to 

14 minimize any potential need for future drawdowns 

15 from the Reserve; and 

16 ‘‘(6) actions to ensure the quality of the gaso17 line and fuel in the Reserve are maintained. 

18 ‘‘(b) NATURAL GAS AND DIESEL.—Not later than 

19 180 days after the date of enactment of this section, the 

20 Secretary shall submit to Congress a report describing the 

21 feasibility of creating a natural gas, diesel, and biofuels 

22 feedstock reserve similar to the Reserve under this part. 

23 ‘‘(c) PRIVATE SECTOR STORAGE CAPACITY.— 


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

2 the date of enactment of this section, the Secretary 

3 shall submit to Congress a report describing— 

4 ‘‘(A) private sector storage capacity of re5 fined petroleum products; and 

6 ‘‘(B) how expansion of existing storage ca7 pacity might alleviate short-term supply con8 straints and the resulting impact on consumer 

9 prices without the need for using releases from 

10 the Reserve. 

11 ‘‘(2) RELEASE; INCENTIVES.—In preparing the 

12 report required under this subsection, the Secretary 

13 shall assess— 

14 ‘‘(A) under what conditions private sector 

15 storage stocks should be released to moderate 

16 supply disruptions and pricing impacts; and 

17 ‘‘(B) what incentives, if any, are necessary 

18 to promote the development of increased private 

19 sector storage capacity. 

20 ‘‘SEC. 195. STRATEGIC GASOLINE AND FUEL RESERVE 

21 FUND. 

22 ‘‘(a) ESTABLISHMENT.—There is established in the 

23 Treasury of the United States a separate revolving fund, 

24 to be known as the ‘Strategic Gasoline and Fuel Reserve 


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1 Fund’ (referred to in this section as the ‘Fund’), con2 sisting of— 

3 ‘‘(1) such amounts as are appropriated to the 

4 Fund under section 196; and 

5 ‘‘(2) all receipts from the sale, exchange, or dis6 position of gasoline or fuel from the Reserve or from 

7 leasing of facilities or providing other services to the 

8 private sector in connection with the Reserve, which 

9 shall be deposited in the Fund on receipt. 

10 ‘‘(b) USE OF FUND.—The Secretary may make ex11 penditures from the Fund, without further appropriation, 

12 for the operation and administration of the Reserve. 

13 ‘‘(c) ADMINISTRATION OF FUND.— 

14 ‘‘(1) IN GENERAL.—The Secretary of the 

15 Treasury shall— 

16 ‘‘(A) maintain the Fund; and 

17 ‘‘(B) as soon as practicable after the end 

18 of each fiscal year and after consultation with 

19 the Secretary, submit to Congress a report de20 scribing the financial condition and operations 

21 of the Fund during the preceding fiscal year. 

22 ‘‘(2) BUDGET.— 

23 ‘‘(A) IN GENERAL.—The Secretary shall 

24 submit the budget for the Fund to the Office 


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1 of Management and Budget, along with the 

2 budget of the Department of Energy. 

3 ‘‘(B) CONTENTS.—The budget shall— 

4 ‘‘(i) consist of estimates made by the 

5 Secretary of expenditures from the Fund 

6 and other relevant financial matters for 

7 the succeeding 5 fiscal years; and 

8 ‘‘(ii) be included in the budget trans9 mitted under section 1105(a) of title 31, 

10 United States Code. 

11 ‘‘SEC. 196. AUTHORIZATION OF APPROPRIATIONS. 

12 ‘‘There are authorized to be appropriated such sums 

13 as are necessary to carry out this part, to remain available 

14 until expended.’’. 

15 (b) CONFORMING AMENDMENT.—The table of con16 tents for title I of the Energy Policy and Conservation 

17 Act (42 U.S.C. 6201 note) is amended by striking the 

18 matter relating to the second part D (relating to expira19 tion) and inserting the following: 

‘‘PART V—STRATEGIC GASOLINE AND FUEL RESERVE

‘‘Sec. 191. Definitions. 

‘‘Sec. 192. Establishment. 

‘‘Sec. 193. Release of gasoline and fuel. 

‘‘Sec. 194. Reports. 

‘‘Sec. 195. Strategic Gasoline and Fuel Reserve Fund. 

‘‘Sec. 196. Authorization of appropriations.’’. 


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1 Subtitle H—Reports on United 

2 States Energy Emergency Pre3 paredness 

4 SEC. 551. POTENTIAL IMPACTS OF OIL SUPPLY SHOCK. 

5 (a) IN GENERAL.—Not later than 60 days after the 

6 date of enactment of this Act, the President shall submit 

7 to Congress a report describing the potential impact on 

8 domestic prices of crude oil, residual fuel oil, and refined 

9 petroleum products of a disruption, for periods of 1 week, 

10 1 year, and 5 years, respectively, of not less than— 

11 (1) 30 percent of United States oil production; 

12 (2) 20 percent of United States refining capac13 ity; and 

14 (3) 5 percent of global oil supplies. 

15 (b) PROJECTIONS AND REMEDIES.—The President 

16 shall include in the report under subsection (a)— 

17 (1) projections of the likely impact of each dis18 ruption described in that subsection on the United 

19 States economy; and 

20 (2) detailed and prioritized recommendations 

21 for remedies in response to each such disruption. 

22 SEC. 552. PREVENTING FUTURE DISRUPTIONS. 

23 (a) IN GENERAL.—The Secretary of Energy shall 

24 enter into a contract with the National Academy of 

25 Sciences under which the National Academy shall conduct 


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1 a review of expenditures and activities carried out by each 

2 organization the total wholesale or retail United States 

3 sales of crude oil, gasoline, and petroleum distillates of 

4 which are in excess of $500,000,000 per year— 

5 (1) to protect the energy supply system of the 

6 United States from— 

7 (A) terrorist attacks; 

8 (B) international supply disruptions; and 

9 (C) natural disasters; and 

10 (2) to ensure a stable and reasonably-priced 

11 supply of those products to consumers in the United 

12 States. 

13 (b) INCLUSIONS.—The review under subsection (a) 

14 shall include an assessment of the preparations of each 

15 organization described in that subsection with respect to 

16 the forecasted period of more frequent and more intense 

17 hurricane activity in the Gulf of Mexico and other vulner18 able coastal areas. 

19 Subtitle J—Impacts of Act on Re20 ducing Greenhouse Gas Emis21 sions 

22 SEC. 561. CLIMATE CHANGE AND ENERGY POLICY FEED23 BACK LOOP. 

24 (a) IN GENERAL.—Not later than 2 years after the 

25 date of enactment of this Act, the Secretary of Energy, 


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1 in consultation with the Secretary of Commerce and the 

2 Administrator of the Environmental Protection Agency, 

3 shall submit to Congress a report on the probable effects 

4 of this Act and the amendments made by this Act during 

5 calendar years 2010, 2015, and 2020 on— 

6 (1) total greenhouse gas emissions, nationally 

7 and by sector; 

8 (2) impacts on land, water, and ecosystems of 

9 expanded coal, biofuels, oil, and natural gas extrac10 tion and production; 

11 (3) job creation; and 

12 (4) the economy. 

13 (b) INCLUSIONS.—The report shall include rec14 ommendations for amendments to this Act and other rel15 evant laws to ensure that the effect of this Act will be 

16 to reduce total domestic greenhouse gas emissions below 

17 levels projected in the report of the Energy Information 

18 Administration entitled ‘‘Annual Energy Outlook 2006’’ 

19 for each of calendar years 2010, 2015, and 2020. 


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1 Subtitle K—Energy Fairness for 

2 America 

3 SEC. 571. ELIMINATION OF DEDUCTION FOR INTANGIBLE 

4 DRILLING AND DEVELOPMENT COSTS FOR 

5 MAJOR OIL COMPANIES. 

6 (a) IN GENERAL.—Section 263(c) of the Internal 

7 Revenue Code of 1986 is amended by adding at the end 

8 the following new sentences: ‘‘This subsection shall not 

9 apply during any taxable year with respect to a major inte10 grated oil company (as defined in section 43(f)(2)) if dur11 ing the preceding taxable year for the production of oil, 

12 the average price of crude oil in the United States is great13 er than $34.71 per barrel, and for the production of nat14 ural gas, the average wellhead price of natural gas in the 

15 United States is greater than $4.34 per 1,000 cubic feet. 

16 For purposes of the preceding sentence, the Secretary 

17 shall determine average prices, taking into consideration 

18 the most recent data reported by the Energy Information 

19 Administration. For taxable years beginning after Decem20 ber 31, 2007, each dollar amount specified in this sub21 section shall be adjusted to reflect changes for the 12- 

22 month period ending the preceding September 30 in the 

23 Consumer Price Index for All Urban Consumers published 

24 by the Bureau of Labor Statistics of the Department of 

25 Labor.’’ 


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

2 this section shall apply to taxable years beginning after 

3 the date of the enactment of this Act. 

4 SEC. 572. ELIMINATION OF ENHANCED OIL RECOVERY 

5 CREDIT FOR MAJOR OIL COMPANIES. 

6 (a) IN GENERAL.—Section 43 of the Internal Rev7 enue Code of 1986 is amended by adding at the end the 

8 following new subsection: 

9 ‘‘(f) NONAPPLICATION OF SECTION.— 

10 ‘‘(1) IN GENERAL.—This section shall not apply 

11 during any taxable year with respect to a major inte12 grated oil company if during the preceding taxable 

13 year for the production of oil, the average price of 

14 crude oil in the United States is greater than $34.71 

15 per barrel. For purposes of the preceding sentence, 

16 the Secretary shall determine average prices, taking 

17 into consideration the most recent data reported by 

18 the Energy Information Administration. For taxable 

19 years beginning after December 31, 2007, the dollar 

20 amount specified in this paragraph shall be adjusted 

21 to reflect changes for the 12-month period ending 

22 the preceding September 30 in the Consumer Price 

23 Index for All Urban Consumers published by the 

24 Bureau of Labor Statistics of the Department of 

25 Labor. 


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1 ‘‘(2) MAJOR INTEGRATED OIL COMPANY.—For 

2 purposes of this subsection, the term ‘major inte3 grated oil company’ means, with respect to any tax4 able year, a producer of crude oil— 

5 ‘‘(A) which has an average daily worldwide 

6 production of crude oil of at least 500,000 bar7 rels for the taxable year, 

8 ‘‘(B) which had gross receipts in excess of 

9 $1,000,000,000 for its last taxable year ending 

10 during calendar year 2005, and 

11 ‘‘(C) to whom subsection (c) of section 

12 613A does not apply by reason of paragraph 

13 (4) of section 613A(d), determined— 

14 ‘‘(i) by substituting ‘15 percent’ for ‘5 

15 percent’ each place it occurs in paragraph 

16 (3) of section 613A(d), and 

17 ‘‘(ii) without regard to whether sub18 section (c) of section 613A does not apply 

19 by reason of paragraph (2) of section 

20 613A(d). 

21 For purposes of subparagraphs (A) and (B), all per22 sons treated as a single employer under subsections 

23 (a) and (b) of section 52 shall be treated as 1 person 

24 and, in case of a short taxable year, the rule under 

25 section 448(c)(3)(B) shall apply.’’. 


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

2 this section shall apply to taxable years beginning after 

3 the date of the enactment of this Act. 

4 SEC. 573. OIL AND GAS ROYALTY-RELATED AMENDMENTS. 

5 (a) REPEAL.—Sections 344 through 346 of the En6 ergy Policy Act of 2005 (42 U.S.C. 15902 et seq.) are 

7 repealed. 

8 (b) TERMINATION OF ALASKA OFFSHORE ROYALTY

9 SUSPENSION.—Section 8(a)(3)(B) of the Outer Conti10 nental Shelf Lands Act (43 U.S.C. 1337(a)(3)(B)) is 

11 amended by striking ‘‘and in the Planning Areas offshore 

12 Alaska’’. 

13 SEC. 574. EXTENSION OF ELECTION TO EXPENSE CERTAIN 

14 REFINERIES. 

15 (a) EXTENSION.— 

16 (1) IN GENERAL.—Section 179C(c)(1) of the 

17 Internal Revenue Code of 1986 (defining qualified 

18 refinery property) is amended— 

19 (A) by striking ‘‘and before January 1, 

20 2012’’ in subparagraph (B) and inserting ‘‘and, 

21 in the case of any qualified refinery described in 

22 subsection (d)(1), before January 1, 2012’’, and 

23 (B) by inserting ‘‘if described in subsection 

24 (d)(1)’’ after ‘‘of which’’ in subparagraph 

25 (F)(i). 


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1 (2) CONFORMING AMENDMENT.—Subsection (d) 

2 of section 179C of the Internal Revenue Code of 

3 1986 is amended to read as follows: 

4 ‘‘(d) QUALIFIED REFINERY.—For purposes of this 

5 section, the term ‘qualified refinery’ means any refinery 

6 located in the United States which is designed to serve 

7 the primary purpose of processing liquid fuel from— 

8 ‘‘(1) crude oil, or 

9 ‘‘(2) qualified fuels (as defined in section 

10 45K(c)).’’. 

11 (3) EFFECTIVE DATE.—The amendments made 

12 by this subsection shall take effect as if included in 

13 the amendment made by section 1323(a) of the En14 ergy Policy Act of 2005. 

15 (b) NONAPPLICATION FOR MAJOR OIL COMPA16 NIES.— 

17 (1) IN GENERAL.—Section 179C of the Internal 

18 Revenue Code of 1986 is amended by adding at the 

19 end the following new subsection: 

20 ‘‘(i) NONAPPLICATION OF SECTION.— 

21 ‘‘(1) IN GENERAL.—This section shall not apply 

22 during any taxable year with respect to a major inte23 grated oil company if during the preceding taxable 

24 year for the production of oil, the average price of 

25 crude oil in the United States is greater than $34.71 


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1 per barrel. For purposes of the preceding sentence, 

2 the Secretary shall determine average prices, taking 

3 into consideration the most recent data reported by 

4 the Energy Information Administration. For taxable 

5 years beginning after December 31, 2007, the dollar 

6 amount specified in this paragraph shall be adjusted 

7 to reflect changes for the 12-month period ending 

8 the preceding September 30 in the Consumer Price 

9 Index for All Urban Consumers published by the 

10 Bureau of Labor Statistics of the Department of 

11 Labor. 

12 ‘‘(2) MAJOR INTEGRATED OIL COMPANY.—For 

13 purposes of this subsection, the term ‘major inte14 grated oil company’ means, with respect to any tax15 able year, a producer of crude oil— 

16 ‘‘(A) which has an average daily worldwide 

17 production of crude oil of at least 500,000 bar18 rels for the taxable year, 

19 ‘‘(B) which had gross receipts in excess of 

20 $1,000,000,000 for its last taxable year ending 

21 during calendar year 2005, and 

22 ‘‘(C) to whom subsection (c) of section 

23 613A does not apply by reason of paragraph 

24 (4) of section 613A(d), determined— 


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1 ‘‘(i) by substituting ‘15 percent’ for ‘5 

2 percent’ each place it occurs in paragraph 

3 (3) of section 613A(d), and 

4 ‘‘(ii) without regard to whether sub5 section (c) of section 613A does not apply 

6 by reason of paragraph (2) of section 

7 613A(d). 

8 For purposes of subparagraphs (A) and (B), all per9 sons treated as a single employer under subsections 

10 (a) and (b) of section 52 shall be treated as 1 person 

11 and, in case of a short taxable year, the rule under 

12 section 448(c)(3)(B) shall apply.’’. 

13 (2) EFFECTIVE DATE.—The amendment made 

14 by this subsection shall apply to taxable years begin15 ning after the date of the enactment of this Act. 

16 SEC. 575. ELIMINATION OF AMORTIZATION OF GEOLOGI17 CAL AND GEOPHYSICAL EXPENDITURES FOR 

18 MAJOR OIL COMPANIES. 

19 (a) IN GENERAL.—Section 167(h) of the Internal 

20 Revenue Code of 1986 is amended by adding at the end 

21 the following new paragraph: 

22 ‘‘(5) NONAPPLICATION OF SECTION.— 

23 ‘‘(A) IN GENERAL.—This subsection shall 

24 not apply during any taxable year with respect 

25 to a major integrated oil company if during the 


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1 preceding taxable year for the production of oil, 

2 the average price of crude oil in the United 

3 States is greater than $34.71 per barrel, and 

4 for the production of natural gas, the average 

5 wellhead price of natural gas in the United 

6 States is greater than $4.34 per 1,000 cubic 

7 feet. For purposes of the preceding sentence, 

8 the Secretary shall determine average prices, 

9 taking into consideration the most recent data 

10 reported by the Energy Information Adminis11 tration. For taxable years beginning after De12 cember 31, 2007, each dollar amount specified 

13 in this subparagraph shall be adjusted to reflect 

14 changes for the 12-month period ending the 

15 preceding September 30 in the Consumer Price 

16 Index for All Urban Consumers published by 

17 the Bureau of Labor Statistics of the Depart18 ment of Labor. 

19 ‘‘(B) MAJOR INTEGRATED OIL COM20 PANY.—For purposes of this paragraph, the 

21 term ‘major integrated oil company’ means, 

22 with respect to any taxable year, a producer of 

23 crude oil— 


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1 ‘‘(i) which has an average daily world2 wide production of crude oil of at least 

3 500,000 barrels for the taxable year, 

4 ‘‘(ii) which had gross receipts in ex5 cess of $1,000,000,000 for its last taxable 

6 year ending during calendar year 2005, 

7 and 

8 ‘‘(iii) to whom subsection (c) of sec9 tion 613A does not apply by reason of 

10 paragraph (4) of section 613A(d), deter11 mined— 

12 ‘‘(I) by substituting ‘15 percent’ 

13 for ‘5 percent’ each place it occurs in 

14 paragraph (3) of section 613A(d), and 

15 ‘‘(II) without regard to whether 

16 subsection (c) of section 613A does 

17 not apply by reason of paragraph (2) 

18 of section 613A(d). 

19 For purposes of subparagraphs (A) and (B), all 

20 persons treated as a single employer under sub21 sections (a) and (b) of section 52 shall be treat22 ed as 1 person and, in case of a short taxable 

23 year, the rule under section 448(c)(3)(B) shall 

24 apply.’’. 


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

2 this section shall take effect on and after the date of the 

3 enactment of this Act. 

4 SEC. 576. REVALUATION OF LIFO INVENTORIES OF MAJOR 

5 INTEGRATED OIL COMPANIES. 

6 (a) GENERAL RULE.—Notwithstanding any other 

7 provision of law, if a taxpayer is a major integrated oil 

8 company for its last taxable year ending in calendar year 

9 2005, the taxpayer shall— 

10 (1) increase, effective as of the close of such 

11 taxable year, the value of each historic LIFO layer 

12 of inventories of crude oil, natural gas, or any other 

13 petroleum product (within the meaning of section 

14 4611) by the layer adjustment amount, and 

15 (2) decrease its cost of goods sold for such tax16 able year by the aggregate amount of the increases 

17 under paragraph (1). 

18 If the aggregate amount of the increases under paragraph 

19 (1) exceed the taxpayer’s cost of goods sold for such tax20 able year, the taxpayer’s gross income for such taxable 

21 year shall be increased by the amount of such excess. 

22 (b) LAYER ADJUSTMENT AMOUNT.—For purposes of 

23 this section— 


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1 (1) IN GENERAL.—The term ‘‘layer adjustment 

2 amount’’ means, with respect to any historic LIFO 

3 layer, the product of— 

4 (A) $18.75, and 

5 (B) the number of barrels of crude oil (or 

6 in the case of natural gas or other petroleum 

7 products, the number of barrel-of-oil equiva8 lents) represented by the layer. 

9 (2) BARREL-OF-OIL EQUIVALENT.—The term 

10 ‘‘barrel-of-oil equivalent’’ has the meaning given 

11 such term by section 29(d)(5) (as in effect before its 

12 redesignation by the Energy Tax Incentives Act of 

13 2005). 

14 (c) APPLICATION OF REQUIREMENT.— 

15 (1) NO CHANGE IN METHOD OF ACCOUNTING.— 

16 Any adjustment required by this section shall not be 

17 treated as a change in method of accounting. 

18 (2) UNDERPAYMENTS OF ESTIMATED TAX.—No 

19 addition to the tax shall be made under section 6655 

20 of the Internal Revenue Code of 1986 (relating to 

21 failure by corporation to pay estimated tax) with re22 spect to any underpayment of an installment re23 quired to be paid with respect to the taxable year 

24 described in subsection (a) to the extent such under25 payment was created or increased by this section. 


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1 (d) MAJOR INTEGRATED OIL COMPANY.—For pur2 poses of this section, the term ‘‘major integrated oil com3 pany’’ has the meaning given such term by section 

4 43(f)(2) of the Internal Revenue Code of 1986. 

5 SEC. 577. MODIFICATIONS OF FOREIGN TAX CREDIT RULES 

6 APPLICABLE TO MAJOR INTEGRATED OIL 

7 COMPANIES WHICH ARE DUAL CAPACITY 

8 TAXPAYERS. 

9 (a) IN GENERAL.—Section 901 of the Internal Rev10 enue Code of 1986 (relating to credit for taxes of foreign 

11 countries and of possessions of the United States) is 

12 amended by redesignating subsection (m) as (n) and by 

13 inserting after subsection (l) the following new subsection: 

14 ‘‘(m) SPECIAL RULES RELATING TO MAJOR INTE15 GRATED OIL COMPANIES WHICH ARE DUAL CAPACITY

16 TAXPAYERS.— 

17 ‘‘(1) GENERAL RULE.—Notwithstanding any 

18 other provision of this chapter, any amount paid or 

19 accrued by a dual capacity taxpayer which is a 

20 major integrated oil company to a foreign country or 

21 possession of the United States for any period shall 

22 not be considered a tax— 

23 ‘‘(A) if, for such period, the foreign coun24 try or possession does not impose a generally 

25 applicable income tax, or 


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1 ‘‘(B) to the extent such amount exceeds 

2 the amount (determined in accordance with reg3 ulations) which— 

4 ‘‘(i) is paid by such dual capacity tax5 payer pursuant to the generally applicable 

6 income tax imposed by the country or pos7 session, or 

8 ‘‘(ii) would be paid if the generally ap9 plicable income tax imposed by the country 

10 or possession were applicable to such dual 

11 capacity taxpayer. 

12 Nothing in this paragraph shall be construed to 

13 imply the proper treatment of any such amount 

14 not in excess of the amount determined under 

15 subparagraph (B). 

16 ‘‘(2) DUAL CAPACITY TAXPAYER.—For pur17 poses of this subsection, the term ‘dual capacity tax18 payer’ means, with respect to any foreign country or 

19 possession of the United States, a person who— 

20 ‘‘(A) is subject to a levy of such country or 

21 possession, and 

22 ‘‘(B) receives (or will receive) directly or 

23 indirectly a specific economic benefit (as deter24 mined in accordance with regulations) from 

25 such country or possession. 


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1 ‘‘(3) GENERALLY APPLICABLE INCOME TAX.— 

2 For purposes of this subsection— 

3 ‘‘(A) IN GENERAL.—The term ‘generally 

4 applicable income tax’ means an income tax (or 

5 a series of income taxes) which is generally im6 posed under the laws of a foreign country or 

7 possession on income derived from the conduct 

8 of a trade or business within such country or 

9 possession. 

10 ‘‘(B) EXCEPTIONS.—Such term shall not 

11 include a tax unless it has substantial applica12 tion, by its terms and in practice, to— 

13 ‘‘(i) persons who are not dual capacity 

14 taxpayers, and 

15 ‘‘(ii) persons who are citizens or resi16 dents of the foreign country or possession. 

17 ‘‘(4) MAJOR INTEGRATED OIL COMPANY.—For 

18 purposes of this subsection, the term ‘major inte19 grated oil company’ has the meaning given such 

20 term by section 43(f)(2).’’. 

21 (b) EFFECTIVE DATE.— 

22 (1) IN GENERAL.—The amendments made by 

23 this section shall apply to taxes paid or accrued in 

24 taxable years beginning after the date of the enact25 ment of this Act. 


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1 (2) CONTRARY TREATY OBLIGATIONS

2 UPHELD.—The amendments made by this section 

3 shall not apply to the extent contrary to any treaty 

4 obligation of the United States. 

5 SEC. 578. DENIAL OF DEDUCTION FOR INCOME ATTRIB6 UTABLE TO DOMESTIC PRODUCTION OF OIL, 

7 NATURAL GAS, OR PRIMARY PRODUCTS 

8 THEREOF. 

9 (a) IN GENERAL.—Subparagraph (B) of section 

10 199(c)(4) of the Internal Revenue Code of 1986 (relating 

11 to exceptions) is amended by striking ‘‘or’’ at the end of 

12 clause (ii), by striking the period at the end of clause (iii) 

13 and inserting ‘‘, or’’, and by inserting after clause (iii) the 

14 following new clause: 

15 ‘‘(iv) in the case of any major inte16 grated oil company (as defined in section 

17 43(f)(2)), the production, refining, proc18 essing, transportation, or distribution of 

19 oil, natural gas, or any primary product 

20 thereof during any taxable year described 

21 in section 167(h)(5)(A).’’. 

22 (b) CONFORMING AMENDMENTS.—Section 199(c)(4) 

23 of the Internal Revenue Code of 1986 is amended— 


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1 (1) in subparagraph (A)(i)(III) by striking 

2 ‘‘electricity, natural gas,’’ and inserting ‘‘electricity’’, 

3 and 

4 (2) in subparagraph (B)(ii) by striking ‘‘elec5 tricity, natural gas,’’ and inserting ‘‘electricity’’. 

6 (c) EFFECTIVE DATE.—The amendments made by 

7 this section shall apply to taxable years beginning after 

8 December 31, 2005. 

9 SEC. 579. RULES RELATING TO FOREIGN OIL AND GAS IN10 COME. 

11 (a) SEPARATE BASKET FOR FOREIGN TAX CRED12 IT.— 

13 (1) YEARS BEFORE 2007.—Paragraph (1) of 

14 section 904(d) of the Internal Revenue Code of 1986 

15 (relating to separate application of section with re16 spect to certain categories of income), as in effect 

17 for years beginning before 2007, is amended by 

18 striking ‘and’ at the end of subparagraph (H), by 

19 redesignating subparagraph (I) as subparagraph (J), 

20 and by inserting after subparagraph (H) the fol21 lowing new subparagraph: 

22 ‘‘(I) foreign oil and gas income, and’’. 

23 (2) 2007 AND AFTER.—Paragraph (1) of sec24 tion 904(d) of such Code, as in effect for years be25 ginning after 2006, is amended by striking ‘‘and’’ at 


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1 the end of subparagraph (A), by striking the period 

2 at the end of subparagraph (B) and inserting ‘‘, 

3 and’’, and by adding at the end the following: 

4 ‘‘(C) foreign oil and gas income.’’. 

5 (b) DEFINITION.— 

6 (1) YEARS BEFORE 2007.—Paragraph (2) of 

7 section 904(d) of the Internal Revenue Code of 

8 1986, as in effect for years beginning before 2007, 

9 is amended by redesignating subparagraphs (H) and 

10 (I) as subparagraphs (I) and (J), respectively, and 

11 by inserting after subparagraph (G) the following 

12 new subparagraph: 

13 ‘‘(H) FOREIGN OIL AND GAS INCOME.— 

14 The term ‘foreign oil and gas income’ has the 

15 meaning given such term by section 954(g).’’. 

16 (2) 2007 AND AFTER.—Section 904(d)(2) of 

17 such Code, as in effect for years after 2006, is 

18 amended by redesignating subparagraphs (J) and 

19 (K) as subparagraphs (K) and (L) and by inserting 

20 after subparagraph (I) the following: 

21 ‘‘(J) FOREIGN OIL AND GAS INCOME.—For 

22 purposes of this section— 

23 ‘‘(i) IN GENERAL.—The term ‘foreign 

24 oil and gas income’ has the meaning given 

25 such term by section 954(g). 


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1 ‘‘(ii) COORDINATION.—Passive cat2 egory income and general category income 

3 shall not include foreign oil and gas income 

4 (as so defined).’’. 

5 (c) CONFORMING AMENDMENTS.— 

6 (1) Section 904(d)(3)(F)(i) of the Internal Rev7 enue Code of 1986 is amended by striking ‘‘or (E)’’ 

8 and inserting ‘‘(E), or (I)’’. 

9 (2) Section 907(a) of such Code is hereby re10 pealed. 

11 (3) Section 907(c)(4) of such Code is hereby re12 pealed. 

13 (4) Section 907(f) of such Code is hereby re14 pealed. 

15 (d) EFFECTIVE DATES.— 

16 (1) IN GENERAL.—The amendments made by 

17 this section shall apply to taxable years beginning 

18 after the date of the enactment of this Act. 

19 (2) YEARS AFTER 2006.—The amendments 

20 made by paragraphs (1)(B) and (2)(B) shall apply 

21 to taxable years beginning after December 31, 2006. 

22 (3) TRANSITIONAL RULES.— 

23 (A) SEPARATE BASKET TREATMENT.—Any 

24 taxes paid or accrued in a taxable year begin25 ning on or before the date of the enactment of 


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1 this Act, with respect to income which was de2 scribed in subparagraph (I) of section 

3 904(d)(1) of such Code (as in effect on the day 

4 before the date of the enactment of this Act), 

5 shall be treated as taxes paid or accrued with 

6 respect to foreign oil and gas income to the ex7 tent the taxpayer establishes to the satisfaction 

8 of the Secretary of the Treasury that such 

9 taxes were paid or accrued with respect to for10 eign oil and gas income. 

11 (B) CARRYOVERS.—Any unused oil and 

12 gas extraction taxes which under section 907(f) 

13 of such Code (as so in effect) would have been 

14 allowable as a carryover to the taxpayer’s first 

15 taxable year beginning after the date of the en16 actment of this Act (without regard to the limi17 tation of paragraph (2) of such section 907(f) 

18 for first taxable year) shall be allowed as 

19 carryovers under section 904(c) of such Code in 

20 the same manner as if such taxes were unused 

21 taxes under such section 904(c) with respect to 

22 foreign oil and gas extraction income. 

23 (C) LOSSES.—The amendment made by 

24 subsection (c)(3) shall not apply to foreign oil 

25 and gas extraction losses arising in taxable 


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1 years beginning on or before the date of the en2 actment of this Act. 

3 SEC. 580. ELIMINATION OF DEFERRAL FOR FOREIGN OIL 

4 AND GAS EXTRACTION INCOME. 

5 (a) GENERAL RULE.—Paragraph (1) of section 

6 954(g) of the Internal Revenue Code of 1986 (defining 

7 foreign base company oil related income) is amended to 

8 read as follows: 

9 ‘‘(1) IN GENERAL.—Except as otherwise pro10 vided in this subsection, the term ‘foreign oil and 

11 gas income’ means, in the case of any major inte12 grated oil company (as defined in section 43(f)(2)) 

13 during any taxable year described in section 

14 167(h)(5)(A), any income of a kind which would be 

15 taken into account in determining the amount of— 

16 ‘‘(A) foreign oil and gas extraction income 

17 (as defined in section 907(c)), or 

18 ‘‘(B) foreign oil related income (as defined 

19 in section 907(c)).’’. 

20 (b) CONFORMING AMENDMENTS.— 

21 (1) Subsections (a)(5), (b)(5), and (b)(6) of 

22 section 954, and section 952(c)(1)(B)(ii)(I) of the 

23 Internal Revenue Code of 1986, are each amended 

24 by striking ‘‘base company oil related income’’ each 


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1 place it appears (including in the heading of sub2 section (b)(8)) and inserting ‘‘oil and gas income’’. 

3 (2) Subsection (b)(4) of section 954 of such 

4 Code is amended by striking ‘‘base company oil-re5 lated income’’ and inserting ‘‘oil and gas income’’. 

6 (3) The subsection heading for subsection (g) of 

7 section 954 of such Code is amended by striking 

8 ‘‘FOREIGN BASE COMPANY OIL RELATED INCOME’’ 

9 and inserting ‘‘FOREIGN OIL AND GAS INCOME’’. 

10 (4) Subparagraph (A) of section 954(g)(2) of 

11 such Code is amended by striking ‘‘foreign base 

12 company oil related income’’ and inserting ‘‘foreign 

13 oil and gas income’’. 

14 (c) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to taxable years of foreign corpora16 tions beginning after the date of the enactment of this 

17 Act, and to taxable years of United States shareholders 

18 ending with or within such taxable years of foreign cor19 porations. 

20 Subtitle L—Protection and Reten21 tion of Value of Publicly-Owned 

22 Energy Resources 

23 SEC. 591. SUSPENSION OF ROYALTY RELIEF. 

24 (a) REQUIREMENT.—Subject to subsection (b), the 

25 Secretary of the Interior (referred to in this subtitle as 


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1 the ‘‘Secretary’’) shall suspend the application of any pro2 vision of Federal law under which a person would other3 wise be provided relief from a requirement to pay a royalty 

4 for the production of oil or natural gas from Federal land 

5 (including submerged land) occurring after the date of en6 actment of this Act during a period in which— 

7 (1) for the production of oil, the average price 

8 of crude oil in the United States during the 4-week 

9 period immediately preceding the suspension is 

10 greater than $34.71 per barrel; and 

11 (2) for the production of natural gas, the aver12 age wellhead price of natural gas in the United 

13 States during the 4-week period immediately pre14 ceding the suspension is greater than $4.34 per 

15 1,000 cubic feet. 

16 (b) DETERMINATION OF AVERAGE PRICES.— 

17 (1) DATA.—For purposes of subsection (a), the 

18 Secretary shall determine average prices, taking into 

19 consideration the most recent data reported by the 

20 Energy Information Administration. 

21 (2) ADJUSTMENT.—For fiscal year 2008 and 

22 each subsequent fiscal year, each dollar amount 

23 specified in subsection (a) shall be adjusted to re24 flect changes for the 12-month period ending the 

25 preceding November 30 in the Consumer Price 


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1 Index for All Urban Consumers published by the 

2 Bureau of Labor Statistics of the Department of 

3 Labor. 

4 SEC. 592. RENEGOTIATION OF EXISTING LEASES. 

5 (a) IN GENERAL.—Not later than 90 days after the 

6 date of enactment of this Act, the Secretary shall make 

7 a determination regarding the ability of the Secretary to 

8 renegotiate leases that— 

9 (1) are in effect prior to the date of enactment 

10 of this Act; 

11 (2) authorize the production of oil or natural 

12 gas on Federal land; and 

13 (3) do not contain terms at least equal to the 

14 royalty relief price thresholds described in section 

15 591. 

16 (b) AFFIRMATIVE DETERMINATION.— 

17 (1) IN GENERAL.—If the Secretary determines 

18 that the Secretary has the authority to renegotiate 

19 leases described in subsection (a), the Secretary 

20 shall immediately offer to renegotiate the terms of 

21 those leases to include the royalty relief price thresh22 olds described in section 591. 

23 (2) FAILURE TO RENEGOTIATE.—If a lessee 

24 fails to renegotiate under paragraph (1), the Sec25 retary shall preclude that lessee from— 


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1 (A) entering into new leases; or 

2 (B) obtaining other existing leases or inter3 ests in leases. 

4 (c) NEGATIVE DETERMINATION.—If the Secretary 

5 determines that the Secretary does not have the authority 

6 to renegotiate leases described in subsection (a), the Sec7 retary shall immediately submit to Congress recommenda8 tions for changes to law that will— 

9 (1) provide the authority necessary; or 

10 (2) produce the same level of revenue from 

11 leases for the production of oil and gas from Federal 

12 land that will otherwise be lost due to the failure of 

13 lessees to renegotiate and modify the terms of exist14 ing leases as described in subsection (b)(1). 

Æ 


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