I 

110TH CONGRESS 

1ST SESSION H. R. 2354 

To promote the national security and stability of the economy of the United 

States by reducing the dependence of the United States on oil through 

the use of alternative fuels and new technology, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 16, 2007 

Mr. VISCLOSKY introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committees on 

Ways and Means, Transportation and Infrastructure, Armed Services, 

Oversight and Government Reform, and Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of 

such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To promote the national security and stability of the economy 

of the United States by reducing the dependence of the 

United States on oil through the use of alternative fuels 

and new technology, and for other purposes. 

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

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

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

5 ‘‘American Fuels Act of 2007’’. 


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

2 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Office of Energy Security. 

Sec. 3. Credit for production of qualified flexible fuel motor vehicles. 

Sec. 4. Incentives for the retail sale of alternative fuels as motor vehicle fuel. 

Sec. 5. Freedom for fuel franchisers. 

Sec. 6. Alternative diesel fuel content of diesel. 

Sec. 7. Excise tax credit for production of cellulosic biomass ethanol. 

Sec. 8. Incentive for Federal and State fleets for medium and heavy duty hybrids. 

Sec. 9. Credit for qualifying ethanol blending and processing equipment. 

Sec. 10. Public access to Federal alternative refueling stations. 

Sec. 11. Purchase of clean fuel buses. 

Sec. 12. Domestic fuel production volumes to meet Department of Defense 

needs. 

Sec. 13. Federal fleet energy conservation improvement. 

3 SEC. 2. OFFICE OF ENERGY SECURITY. 

4 (a) DEFINITIONS.—In this section: 

5 (1) DIRECTOR.—The term ‘‘Director’’ means 

6 the Director of Energy Security appointed under 

7 subsection (c)(1). 

8 (2) OFFICE.—The term ‘‘Office’’ means the Of9 fice of Energy Security established by subsection 

10 (b). 

11 (b) ESTABLISHMENT.—There is established in the 

12 Executive Office of the President the Office of Energy Se13 curity. 

14 (c) DIRECTOR.— 

15 (1) IN GENERAL.—The Office shall be headed 

16 by a Director, who shall be appointed by the Presi17 dent, by and with the advice and consent of the Sen18 ate. 


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1 (2) RATE OF PAY.—The Director shall be paid 

2 at a rate of pay equal to level I of the Executive 

3 Schedule under section 5312 of title 5, United 

4 States Code. 

5 (d) RESPONSIBILITIES.— 

6 (1) IN GENERAL.—The Office, acting through 

7 the Director, shall be responsible for overseeing all 

8 Federal energy security programs, including the co9 ordination of efforts of Federal agencies to assist the 

10 United States in achieving full energy independence. 

11 (2) SPECIFIC RESPONSIBILITIES.—In carrying 

12 out paragraph (1), the Director shall— 

13 (A) serve as head of the energy commu14 nity; 

15 (B) act as the principal advisor to the 

16 President, the National Security Council, the 

17 National Economic Council, the Domestic Pol18 icy Council, and the Homeland Security Council 

19 with respect to intelligence matters relating to 

20 energy security; 

21 (C) with request to budget requests and 

22 appropriations for Federal programs relating to 

23 energy security— 

24 (i) consult with the President and the 

25 Director of the Office of Management and 


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1 Budget with respect to each major Federal 

2 budgetary decision relating to energy secu3 rity of the United States; 

4 (ii) based on priorities established by 

5 the President, provide to the heads of de6 partments containing agencies or organiza7 tions within the energy community, and to 

8 the heads of such agencies and organiza9 tions, guidance for use in developing the 

10 budget for Federal programs relating to 

11 energy security; 

12 (iii) based on budget proposals pro13 vided to the Director by the heads of agen14 cies and organizations described in clause 

15 (ii), develop and determine an annual con16 solidated budget for Federal programs re17 lating to energy security; and 

18 (iv) present the consolidated budget, 

19 together with any recommendations of the 

20 Director and any heads of agencies and or21 ganizations described in clause (ii), to the 

22 President for approval; 

23 (D) establish and meet regularly with a 

24 council of business and labor leaders to develop 

25 and provide to the President and Congress recVerDate Aug 31 2005 23:27 May 17, 2007 Jkt 059200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H2354.IH H2354

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1 ommendations relating to the impact of energy 

2 supply and prices on economic growth; 

3 (E) submit to Congress an annual report 

4 that describes the progress of the United States 

5 toward the goal of achieving full energy inde6 pendence; and 

7 (F) carry out such other responsibilities as 

8 the President may assign. 

9 (e) STAFF.— 

10 (1) IN GENERAL.—The Director may, without 

11 regard to the civil service laws (including regula12 tions), appoint and terminate such personnel as are 

13 necessary to enable the Director to carry out the re14 sponsibilities of the Director under this section. 

15 (2) COMPENSATION.— 

16 (A) IN GENERAL.—Except as provided in 

17 subparagraph (B), the Director may fix the 

18 compensation of personnel without regard to 

19 the provisions of chapter 51 and subchapter III 

20 of chapter 53 of title 5, United States Code, re21 lating to classification of positions and General 

22 Schedule pay rates. 

23 (B) MAXIMUM RATE OF PAY.—The rate of 

24 pay for the personnel appointed by the Director 

25 shall not exceed the rate payable for level V of 


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1 the Executive Schedule under section 5316 of 

2 title 5, United States Code. 

3 (f) AUTHORIZATION OF APPROPRIATIONS.—There 

4 are authorized to be appropriated such sums as are nec5 essary to carry out this section. 

6 SEC. 3. CREDIT FOR PRODUCTION OF QUALIFIED FLEXIBLE 

7 FUEL MOTOR VEHICLES. 

8 (a) IN GENERAL.—Subpart D of part IV of sub9 chapter A of chapter 1 of the Internal Revenue Code of 

10 1986 is amended by adding at the end the following new 

11 section: 

12 ‘‘SEC. 45O. PRODUCTION OF QUALIFIED FLEXIBLE FUEL 

13 MOTOR VEHICLES. 

14 ‘‘(a) ALLOWANCE OF CREDIT.—For purposes of sec15 tion 38, in the case of a manufacturer, the qualified flexi16 ble fuel motor vehicle production credit determined under 

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

18 the incremental flexible fuel motor vehicle cost for each 

19 qualified flexible fuel motor vehicle produced in the United 

20 States by the manufacturer during the taxable year. 

21 ‘‘(b) INCREMENTAL FLEXIBLE FUEL MOTOR VEHI22 CLE COST.—With respect to any qualified flexible fuel 

23 motor vehicle, the incremental flexible fuel motor vehicle 

24 cost is an amount equal to the lesser of— 

25 ‘‘(1) the excess of— 


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

2 flexible fuel motor vehicle, over 

3 ‘‘(B) the cost of producing such motor ve4 hicle if such motor vehicle was not a qualified 

5 flexible fuel motor vehicle, or 

6 ‘‘(2) $100. 

7 ‘‘(c) QUALIFIED FLEXIBLE FUEL MOTOR VEHI8 CLE.—For purposes of this section, the term ‘qualified 

9 flexible fuel motor vehicle’ means a flexible fuel motor ve10 hicle— 

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

12 the manufacturer to meet— 

13 ‘‘(A) the maximum credit allowable for ve14 hicles described in paragraph (2) in determining 

15 the fleet average fuel economy requirements (as 

16 determined under section 32904 of title 49, 

17 United States Code) of the manufacturer for 

18 the model year ending in the taxable year, or 

19 ‘‘(B) the requirements of any other provi20 sion of Federal law, and 

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

22 propelled by an engine which can use as a fuel a 

23 gasoline mixture of which 85 percent (or another 

24 percentage of not less than 70 percent, as the Sec25 retary may determine, by rule, to provide for reVerDate Aug 31 2005 23:27 May 17, 2007 Jkt 059200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H2354.IH H2354

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1 quirements relating to cold start, safety, or vehicle 

2 functions) of the volume of consists of ethanol. 

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

4 For purposes of this section— 

5 ‘‘(1) MOTOR VEHICLE.—The term ‘motor vehi6 cle’ has the meaning given such term by section 

7 30(c)(2). 

8 ‘‘(2) MANUFACTURER.—The term ‘manufac9 turer’ has the meaning given such term in regula10 tions prescribed by the Administrator of the Envi11 ronmental Protection Agency for purposes of the ad12 ministration of title II of the Clean Air Act (42 

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

14 ‘‘(3) REDUCTION IN BASIS.—For purposes of 

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

16 for any expenditure with respect to any property, the 

17 increase in the basis of such property which would 

18 (but for this paragraph) result from such expendi19 ture shall be reduced by the amount of the credit so 

20 allowed. 

21 ‘‘(4) NO DOUBLE BENEFIT.—The amount of 

22 any deduction or credit allowable under this chapter 

23 (other than the credits allowable under this section 

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


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1 credit allowed under subsection (a) for such vehicle 

2 for the taxable year. 

3 ‘‘(5) ELECTION NOT TO TAKE CREDIT.—No 

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

5 vehicle if the taxpayer elects to not have this section 

6 apply to such vehicle. 

7 ‘‘(6) TERMINATION.—This section shall not 

8 apply to any vehicle produced after December 31, 

9 2011. 

10 ‘‘(7) CROSS REFERENCE.—For an election to 

11 claim certain minimum tax credits in lieu of the 

12 credit determined under this section, see section 

13 53(e).’’. 

14 (b) CREDIT ALLOWED AGAINST THE ALTERNATIVE

15 MINIMUM TAX.—Section 38(c)(4)(B) of the Internal Rev16 enue Code of 1986 (defining specified credits) is amended 

17 by striking ‘‘and’’ at the end of clause (i), by striking the 

18 period at the end of clause (ii)(II) and inserting ‘‘, and’’, 

19 and by adding at the end the following new clause: 

20 ‘‘(iii) the credit determined under sec21 tion 45O.’’. 

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

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

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

25 by adding at the end the following new subsection: 


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1 ‘‘(f) ADDITIONAL CREDIT IN LIEU OF FLEXIBLE

2 FUEL MOTOR VEHICLE CREDIT.— 

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

4 making an election under this subsection for a tax5 able year, the amount otherwise determined under 

6 subsection (b) shall be increased by any amount of 

7 the credit determined under section 45O for such 

8 taxable year which the taxpayer elects not to claim 

9 pursuant to such election. 

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

11 election for any taxable year not to claim any 

12 amount of the credit allowable under section 45O 

13 with respect to property produced by the taxpayer 

14 during such taxable year. An election under this sub15 section may only be revoked with the consent of the 

16 Secretary. 

17 ‘‘(3) CREDIT REFUNDABLE.—The aggregate in18 crease in the credit allowed by this section for any 

19 taxable year by reason of this subsection shall for 

20 purposes of this title (other than subsection (b)(2) 

21 of this section) be treated as a credit allowed to the 

22 taxpayer under subpart C.’’. 

23 (d) CONFORMING AMENDMENTS.—Section 38(b) of 

24 the Internal Revenue Code of 1986 is amended by striking 

25 ‘‘plus’’ at the end of paragraph (30), by striking the period 


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1 at the end of paragraph (31) and inserting ‘‘, plus’’, and 

2 by adding at the end the following new paragraph: 

3 ‘‘(32) the qualified flexible fuel motor vehicle 

4 production credit determined under section 

5 45O(a).’’. 

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

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

8 of the Internal Revenue Code of 1986 is amended by add9 ing at the end the following new item: 

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

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

11 this section shall apply to motor vehicles produced in 

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

13 Act. 

14 SEC. 4. INCENTIVES FOR THE RETAIL SALE OF ALTER15 NATIVE FUELS AS MOTOR VEHICLE FUEL. 

16 (a) IN GENERAL.—Subpart D of part IV of sub17 chapter A of chapter 1 of the Internal Revenue Code of 

18 1986 (relating to business related credits) is amended by 

19 inserting after section 40A the following new section: 

20 ‘‘SEC. 40B. CREDIT FOR RETAIL SALE OF ALTERNATIVE 

21 FUELS AS MOTOR VEHICLE FUEL. 

22 ‘‘(a) GENERAL RULE.—The alternative fuel retail 

23 sales credit for any taxable year is the applicable amount 

24 for each gallon of alternative fuel sold at retail by the tax25 payer during such year. 


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1 ‘‘(b) APPLICABLE AMOUNT.—For purposes of this 

2 section, the applicable amount shall be determined in ac3 cordance with the following table: 

‘‘In the case of The applicable amount 

any sale: for each gallon is: 

Before 2010 ............................................................................. 35 cents

During 2010 or 2011 ............................................................... 20 cents

During 2012 ............................................................................ 10 cents. 

4 ‘‘(c) DEFINITIONS.—For purposes of this section— 

5 ‘‘(1) ALTERNATIVE FUEL.—The term ‘alter6 native fuel’ means any fuel at least 85 percent (or 

7 another percentage of not less than 70 percent, as 

8 the Secretary may determine, by rule, to provide for 

9 requirements relating to cold start, safety, or vehicle 

10 functions) of the volume of which consists of eth11 anol. 

12 ‘‘(2) SOLD AT RETAIL.— 

13 ‘‘(A) IN GENERAL.—The term ‘sold at re14 tail’ means the sale, for a purpose other than 

15 resale, after manufacture, production, or impor16 tation. 

17 ‘‘(B) USE TREATED AS SALE.—If any per18 son uses alternative fuel (including any use 

19 after importation) as a fuel to propel any quali20 fied alternative fuel motor vehicle (as defined in 

21 this section) before such fuel is sold at retail, 

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1 ner as if such fuel were sold at retail as a fuel 

2 to propel such a vehicle by such person. 

3 ‘‘(3) QUALIFIED ALTERNATIVE FUEL MOTOR

4 VEHICLE.—The term ‘new qualified alternative fuel 

5 motor vehicle’ means any motor vehicle— 

6 ‘‘(A) which is capable of operating on an 

7 alternative fuel, 

8 ‘‘(B) the original use of which commences 

9 with the taxpayer, 

10 ‘‘(C) which is acquired by the taxpayer for 

11 use or lease, but not for resale, and 

12 ‘‘(D) which is made by a manufacturer. 

13 ‘‘(d) ELECTION TO PASS CREDIT.—A person which 

14 sells alternative fuel at retail may elect to pass the credit 

15 allowable under this section to the purchaser of such fuel 

16 or, in the event the purchaser is a tax-exempt entity or 

17 otherwise declines to accept such credit, to the person 

18 which supplied such fuel, under rules established by the 

19 Secretary. 

20 ‘‘(e) PASS-THRU IN THE CASE OF ESTATES AND

21 TRUSTS.—Under regulations prescribed by the Secretary, 

22 rules similar to the rules of subsection (d) of section 52 

23 shall apply. 

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

25 any fuel sold at retail after December 31, 2012.’’. 


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1 (b) CREDIT TREATED AS BUSINESS CREDIT.—Sec2 tion 38(b) of the Internal Revenue Code of 1986 (relating 

3 to current year business credit), as amended by section 

4 3(d), is amended by striking ‘‘plus’’ at the end of para5 graph (31), by striking the period at the end of paragraph 

6 (32) and inserting ‘‘, plus’’, and by adding at the end the 

7 following new paragraph: 

8 ‘‘(33) the alternative fuel retail sales credit de9 termined under section 40B(a).’’. 

10 (c) CLERICAL AMENDMENT.—The table of sections 

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

12 of the Internal Revenue Code of 1986 is amended by in13 serting after the item relating to section 40A the following 

14 new item: 

‘‘Sec. 40B. Credit for retail sale of alternative fuels as motor vehicle fuel.’’. 

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

16 this section shall apply to fuel sold at retail after the date 

17 of enactment of this Act, in taxable years ending after 

18 such date. 

19 SEC. 5. FREEDOM FOR FUEL FRANCHISERS. 

20 (a) PROHIBITION ON RESTRICTION OF INSTALLA21 TION OF ALTERNATIVE FUEL PUMPS.— 

22 (1) IN GENERAL.—Title I of the Petroleum 

23 Marketing Practices Act (15 U.S.C. 2801 et seq.) is 

24 amended by adding at the end the following: 


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1 ‘‘SEC. 107. PROHIBITION ON RESTRICTION OF INSTALLA2 TION OF ALTERNATIVE FUEL PUMPS. 

3 ‘‘(a) DEFINITION.—In this section: 

4 ‘‘(1) ALTERNATIVE FUEL.—The term ‘alter5 native fuel’ means any fuel— 

6 ‘‘(A) at least 85 percent of the volume of 

7 which consists of ethanol, natural gas, com8 pressed natural gas, liquefied natural gas, lique9 fied petroleum gas, hydrogen, or any combina10 tion of those fuels; or 

11 ‘‘(B) any mixture of biodiesel (as defined 

12 in section 40A(d)(1) of the Internal Revenue 

13 Code of 1986) and diesel fuel (as defined in 

14 section 4083(a)(3) of the Internal Revenue 

15 Code of 1986), determined without regard to 

16 any use of kerosene and containing at least 20 

17 percent biodiesel. 

18 ‘‘(2) FRANCHISE-RELATED DOCUMENT.—The 

19 term ‘franchise-related document’ means— 

20 ‘‘(A) a franchise under this Act; and 

21 ‘‘(B) any other contract or directive of a 

22 franchisor relating to terms or conditions of the 

23 sale of fuel by a franchisee. 

24 ‘‘(b) PROHIBITIONS.— 

25 ‘‘(1) IN GENERAL.—Notwithstanding any provi26 sion of a franchise-related document in effect on the 


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1 date of enactment of this section, no franchisee or 

2 affiliate of a franchisee shall be restricted from— 

3 ‘‘(A) installing on the marketing premises 

4 of the franchisee an alternative fuel pump; 

5 ‘‘(B) converting an existing tank and 

6 pump on the marketing premises of the 

7 franchisee for alternative fuel use; 

8 ‘‘(C) advertising (including through the 

9 use of signage or logos) the sale of any alter10 native fuel; or 

11 ‘‘(D) selling alternative fuel in any speci12 fied area on the marketing premises of the 

13 franchisee (including any area in which a name 

14 or logo of a franchisor or any other entity ap15 pears). 

16 ‘‘(2) ENFORCEMENT.—Any restriction de17 scribed in paragraph (1) that is contained in a fran18 chise-related document and in effect on the date of 

19 enactment of this section— 

20 ‘‘(A) shall be considered to be null and 

21 void as of that date; and 

22 ‘‘(B) shall not be enforced under section 

23 105. 

24 ‘‘(c) EXCEPTION TO 3-GRADE REQUIREMENT.—No 

25 franchise-related document that requires that 3 grades of 


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1 gasoline be sold by the applicable franchisee shall prevent 

2 the franchisee from selling an alternative fuel in lieu of 

3 1 grade of gasoline.’’. 

4 (2) CONFORMING AMENDMENTS.— 

5 (A) IN GENERAL.—Section 101(13) of the 

6 Petroleum Marketing Practices Act (15 U.S.C. 

7 2801(13)) is amended by adjusting the indenta8 tion of subparagraph (C) appropriately. 

9 (B) TABLE OF CONTENTS.—The table of 

10 contents of the Petroleum Marketing Practices 

11 Act (15 U.S.C. 2801 note) is amended— 

12 (i) by inserting after the item relating 

13 to section 106 the following: 

‘‘Sec. 107. Prohibition on restriction of installation of alternative fuel pumps.’’; 

14 and 

15 (ii) by striking the item relating to 

16 section 202 and inserting the following: 

‘‘Sec. 202. Automotive fuel rating testing and disclosure requirements.’’. 

17 (b) APPLICATION OF GASOHOL COMPETITION ACT

18 OF 1980.—Section 26 of the Clayton Act (15 U.S.C. 26a) 

19 is amended— 

20 (1) by redesignating subsection (c) as sub21 section (d); 

22 (2) by inserting after subsection (b) the fol23 lowing: 


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1 ‘‘(c) RESTRICTION PROHIBITED.—For purposes of 

2 subsection (a), restricting the right of a franchisee to in3 stall on the premises of that franchisee qualified alter4 native fuel vehicle refueling property (as defined in section 

5 30C(c) of the Internal Revenue Code of 1986) shall be 

6 considered an unlawful restriction.’’; and 

7 (3) in subsection (d) (as redesignated by para8 graph (1))— 

9 (A) by striking ‘‘(d) As used in this sec10 tion,’’ and inserting the following: ‘‘ ‘section— 

11 ‘(1) the term’ ’’; 

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

13 inserting ‘‘; and’’; and 

14 (C) by adding at the end the following: 

15 ‘‘(2) the term ‘gasohol’ includes any blend of 

16 ethanol and gasoline such as E–85.’’. 

17 SEC. 6. ALTERNATIVE DIESEL FUEL CONTENT OF DIESEL. 

18 (a) FINDINGS.—Congress finds that— 

19 (1) section 211(o) of the Clean Air Act (42 

20 U.S.C. 7535(o)) (as amended by section 1501 of the 

21 Energy Policy Act of 2005 (Public Law 109–58)) 

22 established a renewable fuel program under which 

23 entities in the petroleum sector are required to blend 

24 renewable fuels into motor vehicle fuel based on the 

25 gasoline motor pool; 


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1 (2) the need for energy diversification is greater 

2 as of the date of enactment of this Act than it was 

3 only months before the date of enactment of the En4 ergy Policy Act (Public Law 109–58; 119 Stat. 

5 594); and 

6 (3)(A) the renewable fuel program under sec7 tion 211(o) of the Clean Air Act requires a small 

8 percentage of the gasoline motor pool, totaling near9 ly 140,000,000,000 gallons, to contain a renewable 

10 fuel; and 

11 (B) the small percentage requirement described 

12 in subparagraph (A) does not include the 

13 40,000,000,000-gallon diesel motor pool. 

14 (b) ALTERNATIVE DIESEL FUEL PROGRAM FOR DIE15 SEL MOTOR POOL.—Section 211 of the Clean Air Act (42 

16 U.S.C. 7545) is amended by inserting after subsection (o) 

17 the following: 

18 ‘‘(p) ALTERNATIVE DIESEL FUEL PROGRAM FOR

19 DIESEL MOTOR POOL.— 

20 ‘‘(1) DEFINITION OF ALTERNATIVE DIESEL

21 FUEL.— 

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

23 term ‘alternative diesel fuel’ means biodiesel (as 

24 defined in section 312(f) of the Energy Policy 

25 Act of 1992 (42 U.S.C. 13220(f))) and any 


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1 blending components derived from alternative 

2 fuel (provided that only the alternative fuel por3 tion of any such blending component shall be 

4 considered to be part of the applicable volume 

5 under the alternative diesel fuel program estab6 lished by this subsection). 

7 ‘‘(B) INCLUSIONS.—The term ‘alternative 

8 diesel fuel’ includes a diesel fuel substitute pro9 duced from— 

10 ‘‘(i) animal fat; 

11 ‘‘(ii) plant oil; 

12 ‘‘(iii) recycled yellow grease; 

13 ‘‘(iv) single-cell or microbial oil; 

14 ‘‘(v) thermal depolymerization; 

15 ‘‘(vi) thermochemical conversion; 

16 ‘‘(vii) a coal-to-liquid process (includ17 ing the Fischer-Tropsch process) that pro18 vides for the sequestration of carbon emis19 sions; 

20 ‘‘(viii) a diesel-ethanol blend of not 

21 less than 7 percent ethanol; or 

22 ‘‘(ix) sugar, starch, or cellulosic bio23 mass. 

24 ‘‘(2) ALTERNATIVE DIESEL FUEL PROGRAM.— 

25 ‘‘(A) REGULATIONS.— 


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1 ‘‘(i) IN GENERAL.—Not later than 1 

2 year after the date of enactment of this 

3 subsection, the Administrator shall promul4 gate regulations to ensure that diesel sold 

5 or introduced into commerce in the United 

6 States (except in noncontiguous States or 

7 territories), on an annual average basis, 

8 contains the applicable volume of alter9 native diesel fuel determined in accordance 

10 with subparagraph (B). 

11 ‘‘(ii) PROVISIONS OF REGULATIONS.— 

12 Regardless of the date of promulgation, 

13 the regulations promulgated under clause 

14 (i)— 

15 ‘‘(I) shall contain compliance pro16 visions applicable to refineries, blend17 ers, distributors, and importers, as 

18 appropriate, to ensure that the re19 quirements of this paragraph are met; 

20 but 

21 ‘‘(II) shall not— 

22 ‘‘(aa) restrict geographic 

23 areas in which alternative diesel 

24 fuel may be used; or 


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1 ‘‘(bb) impose any per-gallon 

2 obligation for the use of alter3 native diesel fuel. 

4 ‘‘(iii) REQUIREMENT IN CASE OF

5 FAILURE TO PROMULGATE REGULA6 TIONS.—If the Administrator fails to pro7 mulgate regulations under clause (i), the 

8 percentage of alternative diesel fuel in the 

9 diesel motor pool sold or dispensed to con10 sumers in the United States, on a volume 

11 basis, shall be 0.6 percent for calendar 

12 year 2009. 

13 ‘‘(B) APPLICABLE VOLUME.— 

14 ‘‘(i) CALENDAR YEARS 2009 THROUGH

15 2016.—For the purpose of subparagraph 

16 (A), the applicable volume for any of cal17 endar years 2009 through 2016 shall be 

18 determined in accordance with the fol19 lowing table: 

‘‘Applicable volume of Alternative 

diesel fuel in diesel motor pool 

(in millions of gallons): Calendar year: 

250 ..................................................................................................... 2009 

500 ..................................................................................................... 2010 

750 ..................................................................................................... 2011 

1,000 .................................................................................................. 2012 

1,250 .................................................................................................. 2013 

1,500 .................................................................................................. 2014 

1,750 .................................................................................................. 2015 

2,000 .................................................................................................. 2016 


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1 ‘‘(ii) CALENDAR YEAR 2017 AND

2 THEREAFTER.—The applicable volume for 

3 calendar year 2017 and each calendar year 

4 thereafter shall be determined by the Ad5 ministrator, in coordination with the Sec6 retary of Agriculture and the Secretary of 

7 Energy, based on a review of the imple8 mentation of the program during calendar 

9 years 2009 through 2016, including a re10 view of— 

11 ‘‘(I) the impact of the use of al12 ternative diesel fuels on the environ13 ment, air quality, energy security, job 

14 creation, and rural economic develop15 ment; and 

16 ‘‘(II) the expected annual rate of 

17 future production of alternative diesel 

18 fuels to be used as a blend component 

19 or replacement to the diesel motor 

20 pool. 

21 ‘‘(iii) MINIMUM APPLICABLE VOL22 UME.—For the purpose of subparagraph 

23 (A), the applicable volume for calendar 

24 year 2017 and each calendar year thereVerDate Aug 31 2005 23:27 May 17, 2007 Jkt 059200 PO 00000 Frm 00023 Fmt 6652 Sfmt 6201 E:\BILLS\H2354.IH H2354

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1 after shall be equal to the product obtained 

2 by multiplying— 

3 ‘‘(I) the number of gallons of die4 sel that the Administrator estimates 

5 will be sold or introduced into com6 merce during the calendar year; and 

7 ‘‘(II) the ratio that— 

8 ‘‘(aa) 2,000,000,000 gallons 

9 of alternative diesel fuel; bears to 

10 ‘‘(bb) the number of gallons 

11 of diesel sold or introduced into 

12 commerce during calendar year 

13 2016. 

14 ‘‘(3) APPLICABLE PERCENTAGES.— 

15 ‘‘(A) PROVISION OF ESTIMATE OF VOL16 UMES OF DIESEL SALES.—Not later than Octo17 ber 31 of each of calendar years 2008 through 

18 2016, the Administrator of the Energy Infor19 mation Administration shall provide to the Ad20 ministrator an estimate, with respect to the fol21 lowing calendar year, of the volumes of diesel 

22 projected to be sold or introduced into com23 merce in the United States. 

24 ‘‘(B) DETERMINATION OF APPLICABLE

25 PERCENTAGES.— 


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1 ‘‘(i) IN GENERAL.—Not later than 

2 November 30 of each of calendar years 

3 2009 through 2016, based on the estimate 

4 provided under subparagraph (A), the Ad5 ministrator shall determine and publish in 

6 the Federal Register, with respect to the 

7 following calendar year, the alternative die8 sel fuel obligation that ensures that the re9 quirements of paragraph (2) are met. 

10 ‘‘(ii) REQUIRED ELEMENTS.—The al11 ternative diesel fuel obligation determined 

12 for a calendar year under clause (i) shall— 

13 ‘‘(I) be applicable to refineries, 

14 blenders, and importers, as appro15 priate; 

16 ‘‘(II) be expressed in terms of a 

17 volume percentage of diesel sold or in18 troduced into commerce in the United 

19 States; and 

20 ‘‘(III) subject to subparagraph 

21 (C), consist of a single applicable per22 centage that applies to all categories 

23 of persons described in subclause (I). 

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

25 applicable percentage for a calendar year, the 


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1 Administrator shall make adjustments to pre2 vent the imposition of redundant obligations on 

3 any person described in subparagraph 

4 (B)(ii)(I). 

5 ‘‘(4) CREDIT PROGRAM.— 

6 ‘‘(A) IN GENERAL.—The regulations pro7 mulgated pursuant to paragraph (2)(A) shall 

8 provide for the generation of an appropriate 

9 amount of credits by any person that refines, 

10 blends, or imports diesel that contains a quan11 tity of alternative diesel fuel that is greater 

12 than the quantity required under paragraph 

13 (2). 

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

15 generates a credit under subparagraph (A) may 

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

17 credit to another person, for the purpose of 

18 complying with regulations promulgated pursu19 ant to paragraph (2). 

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

21 generated under this paragraph shall be valid 

22 during the 1-year period beginning on the date 

23 on which the credit is generated. 

24 ‘‘(D) INABILITY TO GENERATE OR PUR25 CHASE SUFFICIENT CREDITS.—The regulations 


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1 promulgated pursuant to paragraph (2)(A) 

2 shall include provisions allowing any person 

3 that is unable to generate or purchase sufficient 

4 credits under subparagraph (A) to meet the re5 quirements of paragraph (2) by carrying for6 ward a credit generated during a previous year 

7 on the condition that the person, during the cal8 endar year following the year in which the al9 ternative diesel fuel deficit is created— 

10 ‘‘(i) achieves compliance with the al11 ternative diesel fuel requirement under 

12 paragraph (2); and 

13 ‘‘(ii) generates or purchases additional 

14 credits under subparagraph (A) to offset 

15 the deficit of the previous year. 

16 ‘‘(5) WAIVERS.— 

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

18 consultation with the Secretary of Agriculture 

19 and the Secretary of Energy, may waive the re20 quirements of paragraph (2) in whole or in part 

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

22 reducing the national quantity of alternative 

23 diesel fuel for the diesel motor pool required 

24 under paragraph (2) based on a determination 


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1 by the Administrator, after public notice and 

2 opportunity for comment, that— 

3 ‘‘(i) implementation of the require4 ment would severely harm the economy or 

5 environment of a State, a region, or the 

6 United States; or 

7 ‘‘(ii) there is an inadequate domestic 

8 supply of alternative diesel fuel. 

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

10 than 90 days after the date on which the Ad11 ministrator receives a petition under subpara12 graph (A), the Administrator, in consultation 

13 with the Secretary of Agriculture and the Sec14 retary of Energy, shall approve or disapprove 

15 the petition. 

16 ‘‘(C) TERMINATION OF WAIVERS.— 

17 ‘‘(i) IN GENERAL.—Except as pro18 vided in clause (ii), a waiver under sub19 paragraph (A) shall terminate on the date 

20 that is 1 year after the date on which the 

21 waiver is provided. 

22 ‘‘(ii) EXCEPTION.—The Adminis23 trator, in consultation with the Secretary 

24 of Agriculture and the Secretary of En25 ergy, may extend a waiver under subparaVerDate Aug 31 2005 23:27 May 17, 2007 Jkt 059200 PO 00000 Frm 00028 Fmt 6652 Sfmt 6201 E:\BILLS\H2354.IH H2354

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1 graph (A), as the Administrator deter2 mines to be appropriate.’’. 

3 (c) PENALTIES AND ENFORCEMENT.—Section 

4 211(d) of the Clean Air Act (42 U.S.C. 7545(d)) is 

5 amended— 

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

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

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

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

10 (d) TECHNICAL AMENDMENTS.—Section 211 of the 

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

12 (1) in subsection (i)(4), by striking ‘‘section 

13 324’’ each place it appears and inserting ‘‘section 

14 325’’; 

15 (2) in subsection (k)(10), by indenting subpara16 graphs (E) and (F) appropriately; 

17 (3) in subsection (n), by striking ‘‘section 

18 219(2)’’ and inserting ‘‘section 216(2)’’; 

19 (4) by redesignating the second subsection (r) 

20 and subsection (s) as subsections (s) and (t), respec21 tively; and 

22 (5) in subsection (t)(1) (as redesignated by 

23 paragraph (4)), by striking ‘‘this subtitle’’ and in24 serting ‘‘this part’’. 


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1 SEC. 7. EXCISE TAX CREDIT FOR PRODUCTION OF CEL2 LULOSIC BIOMASS ETHANOL. 

3 (a) ALLOWANCE OF EXCISE TAX CREDIT.— 

4 (1) IN GENERAL.—Section 6426 of the Internal 

5 Revenue Code of 1986 (relating to credit for alcohol 

6 fuel, biodiesel, and alternative fuel mixtures) is 

7 amended by redesignating subsections (f) and (g) as 

8 subsections (g) and (h), respectively, and by insert9 ing after subsection (e) the following new subsection: 

10 ‘‘(f) CELLULOSIC BIOMASS ETHANOL CREDIT.— 

11 ‘‘(1) IN GENERAL.—For purposes of this sec12 tion, in the case of a cellulosic biomass ethanol pro13 ducer, the cellulosic biomass ethanol credit is the 

14 product of— 

15 ‘‘(A) the product of 51 cents times the 

16 equivalent number of gallons of renewable fuel 

17 specified in section 211(o)(4) of the Clean Air 

18 Act, times 

19 ‘‘(B) the number of gallons of qualified cel20 lulosic biomass ethanol fuel production of such 

21 producer. 

22 ‘‘(2) DEFINITIONS.— 

23 ‘‘(A) CELLULOSIC BIOMASS ETHANOL.— 

24 The term ‘cellulosic biomass ethanol’ has the 

25 meaning given such term under section 

26 211(o)(1)(A) of the Clean Air Act. 


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1 ‘‘(B) QUALIFIED CELLULOSIC BIOMASS

2 ETHANOL FUEL PRODUCTION.—The term 

3 ‘qualified cellulosic biomass ethanol fuel produc4 tion’ means any alcohol which is cellulosic bio5 mass ethanol which during the taxable year— 

6 ‘‘(i) is sold by the producer to another 

7 person— 

8 ‘‘(I) for use by such other person 

9 in the production of an alcohol fuel 

10 mixture in such other person’s trade 

11 or business (other than casual off12 farm production), 

13 ‘‘(II) for use by such other per14 son as a fuel in a trade or business, 

15 or 

16 ‘‘(III) who sells such cellulosic 

17 biomass ethanol at retail to another 

18 person and places such ethanol in the 

19 fuel tank of such other person, or 

20 ‘‘(ii) is used or sold by the producer 

21 for any purpose described in clause (i). 

22 ‘‘(3) DENIAL OF DOUBLE BENEFIT.—No credit 

23 shall be allowed under subsection (b) or (c) to any 

24 taxpayer with respect to any fuel to the extent that 

25 a credit has been allowed with respect to such fuel 


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1 to any taxpayer under this subsection or a payment 

2 has been made with respect to such fuel under sec3 tion 6427(e). 

4 ‘‘(4) TERMINATION.—This section shall not 

5 apply to any sale or use for any period after Decem6 ber 31, 2008.’’. 

7 (2) CONFORMING AMENDMENTS.— 

8 (A) Section 6426(a) of such Code is 

9 amended— 

10 (i) by striking ‘‘subsection (d)’’ in 

11 paragraph (2) and inserting ‘‘subsections 

12 (d) and (f)’’, and 

13 (ii) by striking ‘‘subsections (d) and 

14 (e)’’ in the last sentence and inserting 

15 ‘‘subsections (d), (e), and (f)’’. 

16 (B) The heading for section 6426 of such 

17 Code is amended to read as follows: 

18 ‘‘SEC. 6426. CREDIT FOR CERTAIN FUELS AND FUEL MIX19 TURES.’’. 

20 (C) The table of section for subchapter B 

21 of chapter 65 of such Code is amended by strik22 ing the item relating to section 6426 and in23 serting the following new item: 

‘‘Sec. 6426. Credit for certain fuels and fuel mixtures.’’. 

24 (b) CELLULOSIC BIOMASS ETHANOL NOT USED FOR

25 A TAXABLE PURPOSE.— 


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1 (1) IN GENERAL.—Section 6427(e) of the Inter2 nal Revenue Code of 1986 is amended by redesig3 nating paragraphs (3) through (5) as paragraphs 

4 (4) through (6), respectively, and by inserting after 

5 paragraph (2) the following new paragraph: 

6 ‘‘(3) CELLULOSIC BIOMASS ETHANOL.—If any 

7 person sells or uses cellulosic biomass ethanol (as de8 fined in section 6426(f)(2)(A)) for a purpose de9 scribed in section 6426(f)(2)(B) in such person’s 

10 trade or business, the Secretary shall pay (without 

11 interest) to such person an amount equal to the cel12 lulosic biomass ethanol credit with respect to such 

13 fuel.’’. 

14 (2) DENIAL OF DOUBLE BENEFIT.—Paragraph 

15 (4) of section 6427(e) of such Code, as redesignated 

16 by paragraph (1), is amended to read as follows: 

17 ‘‘(4) COORDINATION WITH OTHER REPAYMENT

18 PROVISIONS.— 

19 ‘‘(A) IN GENERAL.—No amount shall be 

20 payable under paragraph (1), (2), or (3) with 

21 respect to any mixture, alternative fuel, or cel22 lulosic biomass ethanol with respect to which an 

23 amount is allowed as a credit under section 

24 6426. 


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1 ‘‘(B) CELLULOSIC BIOMASS ETHANOL.— 

2 No amount shall be payable under paragraph 

3 (1) or (2) with respect to any cellulosic biomass 

4 ethanol if a payment has been made with re5 spect to such ethanol under paragraph (3).’’. 

6 (3) TERMINATION.—Paragraph (6) of section 

7 6427(e) of such Code, as redesignated by paragraph 

8 (1), is amended by striking ‘‘and’’ at the end of sub9 paragraph (C), by striking the period at the end of 

10 subparagraph (D) and inserting ‘‘, and’’, and by 

11 adding at the end the following new subparagraph: 

12 ‘‘(E) any cellulosic biomass ethanol credit 

13 (as defined in section 6426(f)(2)(A)) sold or 

14 used after December 31, 2008.’’. 

15 (4) CONFORMING AMENDMENT.—Paragraph (5) 

16 of section 6427(e) of such Code, as redesignated by 

17 paragraph (1), is amended by striking ‘‘or alter18 native fuel mixture credit’’ and inserting ‘‘, alter19 native fuel mixture credit, or cellulosic biomass eth20 anol credit’’. 

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

22 this section shall apply to fuel sold or used after the date 

23 of the enactment of this Act. 


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1 SEC. 8. INCENTIVE FOR FEDERAL AND STATE FLEETS FOR 

2 MEDIUM AND HEAVY DUTY HYBRIDS. 

3 Section 301 of the Energy Policy Act of 1992 (42 

4 U.S.C. 13211) is amended— 

5 (1) in paragraph (3), by striking ‘‘or a dual 

6 fueled vehicle’’ and inserting ‘‘, a dual fueled vehicle, 

7 or a medium or heavy duty vehicle that is a hybrid 

8 vehicle’’; 

9 (2) by redesignating paragraphs (11), (12), 

10 (13), and (14) as paragraphs (12), (14), (15), and 

11 (16), respectively; 

12 (3) by inserting after paragraph (10) the fol13 lowing: 

14 ‘‘(11) the term ‘hybrid vehicle’ means a vehicle 

15 powered both by a diesel or gasoline engine and an 

16 electric motor that is recharged as the vehicle oper17 ates;’’; and 

18 (4) by inserting after paragraph (12) (as redes19 ignated by paragraph (2)) the following: 

20 ‘‘(13) the term ‘medium or heavy duty vehicle’ 

21 means a vehicle that— 

22 ‘‘(A) in the case of a medium duty vehicle, 

23 has a gross vehicle weight rating of more than 

24 8,500 pounds but not more than 14,000 

25 pounds; and 


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1 ‘‘(B) in the case of a heavy duty vehicle, 

2 has a gross vehicle weight rating of more than 

3 14,000 pounds;’’. 

4 SEC. 9. CREDIT FOR QUALIFYING ETHANOL BLENDING AND 

5 PROCESSING EQUIPMENT. 

6 (a) ALLOWANCE OF QUALIFYING ETHANOL BLEND7 ING AND PROCESSING EQUIPMENT CREDIT.—Section 46 

8 of the Internal Revenue Code of 1986 (relating to amount 

9 of credit) is amended by striking ‘‘and’’ at the end of para10 graph (3), by striking the period at the end of paragraph 

11 (4) and inserting ‘‘, and’’, and by adding at the end the 

12 following new paragraph: 

13 ‘‘(5) the qualifying ethanol blending and proc14 essing equipment credit.’’. 

15 (b) AMOUNT OF QUALIFYING ETHANOL BLENDING

16 AND PROCESSING EQUIPMENT CREDIT.—Subpart E of 

17 part IV of subchapter A of chapter 1 of the Internal Rev18 enue Code of 1986 (relating to rules for computing invest19 ment credit) is amended by inserting after section 48B 

20 the following new section: 

21 ‘‘SEC. 48C. QUALIFYING ETHANOL BLENDING AND PROC22 ESSING EQUIPMENT. 

23 ‘‘(a) IN GENERAL.—For purposes of section 46, the 

24 qualifying ethanol blending and processing equipment 

25 credit for any taxable year is an amount equal to 50 perVerDate Aug 31 2005 23:27 May 17, 2007 Jkt 059200 PO 00000 Frm 00036 Fmt 6652 Sfmt 6201 E:\BILLS\H2354.IH H2354

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1 cent of the basis of the qualifying ethanol blending and 

2 processing equipment placed in service at a qualifying fa3 cility during such taxable year. 

4 ‘‘(b) LIMITATION.—The credit allowed under sub5 section (a) for qualifying ethanol blending and processing 

6 equipment placed in service at any 1 qualifying facility 

7 during any taxable year shall not exceed $2,000,000. 

8 ‘‘(c) QUALIFYING ETHANOL BLENDING AND PROC9 ESSING EQUIPMENT.—For purposes of this section, the 

10 term ‘qualifying ethanol blending and processing equip11 ment’ means any technology installed in or on a qualifying 

12 facility for blending ethanol with petroleum fuels for the 

13 purpose of direct retail sale, including in-line blending 

14 equipment, storage tanks, pumps and piping for dena15 turants, and load-out equipment. 

16 ‘‘(d) QUALIFYING FACILITY.—For purposes of this 

17 section, the term ‘qualifying facility’ means any facility 

18 which produces not less than 1,000,000 gallons of ethanol 

19 during the taxable year. 

20 ‘‘(e) SPECIAL RULE FOR CERTAIN SUBSIDIZED

21 PROPERTY.—Rules similar to section 48(a)(4) shall apply 

22 for purposes of this section. 

23 ‘‘(f) CERTAIN QUALIFIED PROGRESS EXPENDITURES

24 RULES MADE APPLICABLE.—Rules similar to the rules of 

25 subsections (c)(4) and (d) of section 46 (as in effect on 


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1 the day before the enactment of the Revenue Reconcili2 ation Act of 1990) shall apply for purposes of this sub3 section. 

4 ‘‘(g) TERMINATION.—This section shall not apply to 

5 property placed in service after December 31, 2014.’’. 

6 (c) RECAPTURE OF CREDIT WHERE EMISSIONS RE7 DUCTION OFFSET IS SOLD.—Paragraph (1) of section 

8 50(a) of the Internal Revenue Code of 1986 is amended 

9 by redesignating subparagraph (B) as subparagraph (C) 

10 and by inserting after subparagraph (A) the following new 

11 subparagraph: 

12 ‘‘(B) SPECIAL RULE FOR QUALIFYING

13 ETHANOL BLENDING AND PROCESSING EQUIP14 MENT.—For purposes of subparagraph (A), any 

15 investment property which is qualifying ethanol 

16 blending and processing equipment (as defined 

17 in section 48C(c)) shall cease to be investment 

18 credit property with respect to a taxpayer if 

19 such taxpayer receives a payment in exchange 

20 for a credit for emission reductions attributable 

21 to such qualifying pollution control equipment 

22 for purposes of an offset requirement under 

23 part D of title I of the Clean Air Act.’’. 

24 (d) SPECIAL RULE FOR BASIS REDUCTION; RECAP25 TURE OF CREDIT.—Paragraph (3) of section 50(c) of the 


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1 Internal Revenue Code of 1986 (relating to basis adjust2 ment to investment credit property) is amended by insert3 ing ‘‘or qualifying ethanol blending and processing equip4 ment credit’’ after ‘‘energy credit’’. 

5 (e) CERTAIN NONRECOURSE FINANCING EXCLUDED

6 FROM CREDIT BASE.—Section 49(a)(1)(C) of the Internal 

7 Revenue Code of 1986 (defining credit base) is amended 

8 by striking ‘‘and’’ at the end of clause (iii), by striking 

9 the period at the end of clause (iv) and inserting ‘‘, and’’, 

10 and by adding at the end the following new clause: 

11 ‘‘(v) the basis of any property which 

12 is part of any qualifying ethanol blending 

13 and processing equipment under section 

14 48C.’’. 

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

16 this section shall apply to property placed in service after 

17 December 31, 2007, in taxable years ending after such 

18 date, under rules similar to the rules of section 48(m) of 

19 the Internal Revenue Code of 1986 (as in effect on the 

20 day before the date of the enactment of the Revenue Rec21 onciliation Act of 1990). 

22 SEC. 10. PUBLIC ACCESS TO FEDERAL ALTERNATIVE RE23 FUELING STATIONS. 

24 (a) DEFINITIONS.—In this section: 


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1 (1) ALTERNATIVE FUEL REFUELING STA2 TION.—The term ‘‘alternative fuel refueling station’’ 

3 has the meaning given the term ‘‘qualified alter4 native fuel vehicle refueling property’’ in section 

5 30C(c)(1) of the Internal Revenue Code of 1986. 

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

7 the Secretary of Energy. 

8 (b) ACCESS TO FEDERAL ALTERNATIVE REFUELING

9 STATIONS.—Not later than 18 months after the date of 

10 enactment of this Act— 

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

12 Federal property that includes at least 1 fuel refuel13 ing station shall include at least 1 alternative fuel 

14 refueling station; and 

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

16 alternative fuel refueling station located on property 

17 owned by the Federal government shall permit full 

18 public access for the purpose of refueling using al19 ternative fuel. 

20 (c) DURATION.—The requirements described in sub21 section (b) shall remain in effect until the sooner of— 

22 (1) the date that is 7 years after the date of en23 actment of this Act; or 

24 (2) the date on which the Secretary determines 

25 that not less than 5 percent of the commercial reVerDate Aug 31 2005 23:27 May 17, 2007 Jkt 059200 PO 00000 Frm 00040 Fmt 6652 Sfmt 6201 E:\BILLS\H2354.IH H2354

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1 fueling infrastructure in the United States offers al2 ternative fuels to the general public. 

3 (d) EXCEPTIONS.— 

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

5 to any Federal property under the jurisdiction of a 

6 Federal agency if the Secretary determines that al7 ternative fuel is not reasonably available to retail 

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

9 the agency to the Secretary. 

10 (2) NATIONAL SECURITY EXEMPTION.—Sub11 section (b)(2) does not apply to property of the Fed12 eral government that the Secretary, in consultation 

13 with the Secretary of Defense, has certified must be 

14 exempt for national security reasons. 

15 (e) REPORT.—Not later than October 31 of each year 

16 beginning after the date of enactment of this Act, the 

17 President shall submit to Congress a report that describes 

18 the progress of the agencies of the Federal Government 

19 (including the Executive Office of the President) in com20 plying with— 

21 (1) the Energy Policy Act of 1992 (42 U.S.C. 

22 13201 et seq.); 

23 (2) Executive Order 13149 (65 Fed. Reg. 

24 24595; relating to greening the government through 

25 Federal fleet and transportation efficiency); and 


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1 (3) the fueling center requirements of this sec2 tion. 

3 SEC. 11. PURCHASE OF CLEAN FUEL BUSES. 

4 (a) IN GENERAL.—Chapter 53 of title 49, United 

5 States Code, is amended by inserting after section 5325 

6 the following: 

7 ‘‘§ 5326. Purchase of clean fuel buses 

8 ‘‘(a) DEFINITIONS.—In this section, the following 

9 definitions apply: 

10 ‘‘(1) ALTERNATIVE DIESEL FUEL.— 

11 ‘‘(A) IN GENERAL.—The term ‘alternative 

12 diesel fuel’ means— 

13 ‘‘(i) biodiesel (as defined in section 

14 312(f) of the Energy Policy Act of 1992 

15 (42 U.S.C. 13220(f))); and 

16 ‘‘(ii) any blending components derived 

17 from alternative fuel. 

18 ‘‘(B) INCLUSIONS.—The term ‘alternative 

19 diesel fuel’ includes a diesel fuel substitute pro20 duced from— 

21 ‘‘(i) animal fat; 

22 ‘‘(ii) plant oil; 

23 ‘‘(iii) recycled yellow grease; 

24 ‘‘(iv) single-cell or microbial oil; 

25 ‘‘(v) thermal depolymerization; 


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1 ‘‘(vi) thermochemical conversion; 

2 ‘‘(vii) a coal-to-liquid process (includ3 ing the Fischer-Tropsch process) that pro4 vides for the sequestration of carbon emis5 sions; or 

6 ‘‘(viii) a diesel-ethanol blend of not 

7 less than 7 percent ethanol. 

8 ‘‘(2) CELLULOSIC BIOMASS ETHANOL.—The 

9 term ‘cellulosic biomass ethanol’ means ethanol de10 rived from any lignocellulosic or hemicellulosic mat11 ter that is available on a renewable or recurring 

12 basis, including— 

13 ‘‘(A) dedicated energy crops and trees; 

14 ‘‘(B) wood and wood residues; 

15 ‘‘(C) plants; 

16 ‘‘(D) grasses; 

17 ‘‘(E) agricultural residues; 

18 ‘‘(F) fibers; 

19 ‘‘(G) animal wastes and other waste mate20 rials; and 

21 ‘‘(H) municipal solid waste. 

22 ‘‘(3) CLEAN FUEL BUS.—The term ‘clean fuel 

23 bus’ means a vehicle that— 

24 ‘‘(A) is capable of being powered by— 

25 ‘‘(i) compressed natural gas; 


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1 ‘‘(ii) liquefied natural gas; 

2 ‘‘(iii) 1 or more batteries; 

3 ‘‘(iv) a fuel that is composed of at 

4 least 85 percent ethanol (or another per5 centage of not less than 70 percent, as the 

6 Secretary may determine, by rule, to pro7 vide for requirements relating to cold start, 

8 safety, or vehicle functions); 

9 ‘‘(v) electricity (including a hybrid 

10 electric or plug-in hybrid electric vehicle); 

11 ‘‘(vi) a fuel cell; 

12 ‘‘(vii) a fuel that is composed of at 

13 least 22 percent biodiesel (as defined in 

14 section 312(f) of the Energy Policy Act of 

15 1992 (42 U.S.C. 13220(f)) (or another 

16 percentage of not less than 10 percent, as 

17 the Secretary may determine, by rule, to 

18 provide for requirements relating to cold 

19 start, safety, or vehicle functions); 

20 ‘‘(viii) ultra-low sulfur diesel; or 

21 ‘‘(ix) liquid fuel manufactured with a 

22 coal feedstock; and 

23 ‘‘(B) has been certified by the Adminis24 trator of the Environmental Protection Agency 

25 to significantly reduce harmful emissions, parVerDate Aug 31 2005 23:27 May 17, 2007 Jkt 059200 PO 00000 Frm 00044 Fmt 6652 Sfmt 6201 E:\BILLS\H2354.IH H2354

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1 ticularly in a nonattainment area (as defined in 

2 section 171 of the Clean Air Act (42 U.S.C. 

3 7501)). 

4 ‘‘(4) QUALIFIED ALTERNATIVE FUEL PRO5 DUCER.—The term ‘qualified alternative fuel pro6 ducer’ means a producer of qualified fuels that, dur7 ing the applicable taxable year— 

8 ‘‘(A) are sold by the producer to another 

9 person— 

10 ‘‘(i) for use by the person in the pro11 duction of a mixture of qualified fuels in 

12 the trade or business of the person (other 

13 than casual off-farm production); 

14 ‘‘(ii) for use by the other person as a 

15 fuel in a trade or business; or 

16 ‘‘(iii) that— 

17 ‘‘(I) sells to another person the 

18 qualified fuel at retail; and 

19 ‘‘(II) places the qualified fuel in 

20 the fuel tank of the person that pur21 chased the qualified fuel; or 

22 ‘‘(B) are used or sold by the producer for 

23 any purpose described in subparagraph (A). 

24 ‘‘(5) QUALIFIED FUEL.—The term ‘qualified 

25 fuel’ includes— 


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1 ‘‘(A) cellulosic biomass ethanol; 

2 ‘‘(B) ethanol produced in facilities in which 

3 animal waste or other waste materials are di4 gested or otherwise used to displace at least 90 

5 percent of the fossil fuels that would otherwise 

6 be used in the production of ethanol; 

7 ‘‘(C) renewable fuels; 

8 ‘‘(D) alternative diesel fuels; 

9 ‘‘(E) sugar, starch, or cellulosic biomass; 

10 and 

11 ‘‘(F) any other fuel that is not substan12 tially petroleum. 

13 ‘‘(6) RENEWABLE FUEL.—The term ‘renewable 

14 fuel’ means fuel, at least 85 percent of the volume 

15 of which— 

16 ‘‘(A)(i) is produced from grain, starch, oil17 seeds, vegetable, animal, or fish materials in18 cluding fats, greases, and oils, sugarcane, sugar 

19 beets, sugar components, tobacco, potatoes, or 

20 other biomass; or 

21 ‘‘(ii) is natural gas produced from a biogas 

22 source, including a landfill, sewage waste treat23 ment plant, feedlot, or other place in which de24 caying organic material is found; and 


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1 ‘‘(B) is used to substantially replace or re2 duce the quantity of fossil fuel present in a fuel 

3 mixture used to operate a motor vehicle. 

4 ‘‘(b) PURCHASE OF BUSES.—Subject to subsections 

5 (c) and (d), beginning on the date that is 2 years after 

6 the date of enactment of this section, a bus purchased 

7 using funds made available from the Mass Transit Ac8 count of the Highway Trust Fund shall be a clean fuel 

9 bus. 

10 ‘‘(c) ULTRA-LOW SULFUR DIESEL.— 

11 ‘‘(1) IN GENERAL.—Except as provided in para12 graph (2), not more than 20 percent of the amount 

13 of the funds provided to a recipient to purchase 

14 buses under this section may be used by the recipi15 ent to purchase clean fuel buses that are capable of 

16 being powered by a fuel described in clause (iv), 

17 (vii), (viii), or (ix) of subsection (a)(3)(A). 

18 ‘‘(2) EXCEPTION.—Paragraph (1) shall not 

19 apply if the recipient enters into a 3–year purchase 

20 agreement with a qualified alternative fuel producer 

21 to acquire qualified fuels in a volume sufficient to 

22 power the clean fuel buses purchased using amounts 

23 made available under this section. 

24 ‘‘(d) USE OF CERTAIN ALTERNATIVE FUELS.— 


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1 ‘‘(1) IN GENERAL.—To be eligible to receive 

2 funds under subsection (c)(2) for the purchase of a 

3 clean fuel bus that is capable of being powered by 

4 a fuel described in clause (iv), (vii), or (ix) of sub5 section (a)(3)(A), an applicant or recipient shall sub6 mit to the Secretary— 

7 ‘‘(A) a certification that the applicant will 

8 operate the clean fuel bus only with the fuel at 

9 all times in accordance with the fuel capacity 

10 and use of the fuel recommended by the manu11 facturer of the clean fuel bus; and 

12 ‘‘(B) not later than 180 days after the 

13 purchase of the clean fuel bus and every 180 

14 days thereafter, a report that documents that 

15 the fuel was used in accordance with subpara16 graph (A) during the 180-day period ending on 

17 the date of the report. 

18 ‘‘(2) NONCOMPLIANCE.—Failure of an appli19 cant or recipient of funds to provide the certification 

20 or documentation required under paragraph (1) 

21 shall— 

22 ‘‘(A) be considered a violation of the agree23 ment to receive the funds; and 

24 ‘‘(B) require the applicant or recipient to 

25 reimburse the Secretary the full amount of the 


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1 funds not later than 90 days after the Sec2 retary has determined that a violation has oc3 curred.’’. 

4 (b) CONFORMING AMENDMENT.—The analysis for 

5 such chapter 53 is amended by inserting after the item 

6 relating to section 5325 the following: 

‘‘5326. Purchase of clean fuel buses.’’. 

7 SEC. 12. DOMESTIC FUEL PRODUCTION VOLUMES TO MEET 

8 DEPARTMENT OF DEFENSE NEEDS. 

9 Section 2922d of title 10, United States Code is 

10 amended— 

11 (1) in the heading, by striking ‘‘and tar 

12 sands’’ and inserting ‘‘tar sands, and other 

13 sources’’; 

14 (2) in subsection (a), by striking ‘‘fuel pro15 duced, in whole or in part, from coal, oil shale, and 

16 tar sands (referred to in this section as a ‘covered 

17 fuel’) that are extracted by either mining or in-situ 

18 methods and refined or otherwise processed in the 

19 United States’’ and inserting ‘‘fuel produced, in 

20 whole or in part, from coal, oil shale, and tar sands 

21 that are extracted by either mining or in-situ meth22 ods and refined or otherwise processed in the United 

23 States and fuel produced in the United States using 

24 starch, sugar, cellulosic biomass, plant or animal 

25 oils, or thermal chemical conversion, thermal 


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1 depolymerization, or thermal conversion processes 

2 (referred to in this section as a ‘covered fuel’)’’; 

3 (3) in subsection (d), by striking ‘‘1 or more 

4 years’’ and inserting ‘‘up to 5 years’’; 

5 (4) in subsection (e), by striking the period at 

6 the end and inserting the following: ‘‘, with consider7 ation given to military installations closed or re8 aligned under a round of defense base closure and 

9 realignment.’’; and 

10 (5) by adding at the end the following new sub11 section: 

12 ‘‘(f) PRODUCTION FACILITIES FOR COVERED

13 FUELS.—The Secretary of Defense may enter into con14 tracts or other agreements with private companies or other 

15 entities to develop and operate production facilities for 

16 covered fuels, and may provide for the construction or cap17 ital modification of production facilities for covered 

18 fuels.’’. 

19 SEC. 13. FEDERAL FLEET ENERGY CONSERVATION IM20 PROVEMENT. 

21 (a) DEFINITIONS.—Section 301 of the Energy Policy 

22 Act of 1992 (42 U.S.C. 13211) is amended— 

23 (1) in paragraph (3), by inserting before the 

24 semicolon at the end the following: ‘‘, including a ve25 hicle that is propelled by electric drive transportation 


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1 technology, engine dominant hybrid electric tech2 nology, or plug-in hybrid technology’’; 

3 (2) in paragraph (13), by striking ‘‘and’’ after 

4 the semicolon at the end; 

5 (3) in paragraph (14), by striking the period at 

6 the end and inserting a semicolon; and 

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

8 ‘‘(15) the term ‘electric drive transportation 

9 technology’ means— 

10 ‘‘(A) technology that uses an electric motor 

11 for all or part of the motive power of a vehicle 

12 (regardless of whether off-board electricity is 

13 used), including— 

14 ‘‘(i) a battery electric vehicle; 

15 ‘‘(ii) a fuel cell vehicle; 

16 ‘‘(iii) an engine dominant hybrid elec17 tric vehicle; 

18 ‘‘(iv) a plug-in hybrid electric vehicle; 

19 ‘‘(v) a plug-in hybrid fuel cell vehicle; 

20 and 

21 ‘‘(vi) an electric rail vehicle; or 

22 ‘‘(B) technology that uses equipment for 

23 transportation (including transportation involv24 ing any mobile source of air pollution) that uses 

25 an electric motor to replace an internal combusVerDate Aug 31 2005 23:27 May 17, 2007 Jkt 059200 PO 00000 Frm 00051 Fmt 6652 Sfmt 6201 E:\BILLS\H2354.IH H2354

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1 tion engine for all or part of the work of the 

2 equipment, including corded electric equipment 

3 that is linked to transportation or a mobile 

4 source of air pollution; 

5 ‘‘(16) the term ‘engine dominant hybrid electric 

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

7 ‘‘(A) is propelled by an internal combus8 tion engine or heat engine using— 

9 ‘‘(i) any combustible fuel; and 

10 ‘‘(ii) an on-board, rechargeable stor11 age device; and 

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

13 source of electricity; and 

14 ‘‘(17) the term ‘plug-in hybrid electric vehicle’ 

15 means an on-road or nonroad vehicle that is pro16 pelled by an internal combustion engine or heat en17 gine using— 

18 ‘‘(A) any combustible fuel; 

19 ‘‘(B) an on-board, rechargeable storage de20 vice; and 

21 ‘‘(C) a means of using an off-board source 

22 of electricity.’’. 

23 (b) MINIMUM FEDERAL FLEET REQUIREMENT.— 

24 Section 303(b)(1) of the Energy Policy Act of 1992 (42 

25 U.S.C. 13212(b)(1)) is amended— 


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1 (1) in subparagraph (C), by striking ‘‘and’’ 

2 after the semicolon; 

3 (2) in subparagraph (D), by striking ‘‘fiscal 

4 year 1999 and thereafter,’’ and inserting ‘‘each of 

5 fiscal years 1999 through 2013; and’’; and 

6 (3) by inserting after subparagraph (D) the fol7 lowing: 

8 ‘‘(E) 100 percent in fiscal year 2014 and 

9 thereafter,’’. 

Æ 


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