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[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 5622 Introduced in Senate (IS)]

<DOC>

118th CONGRESS
  2d Session
                                S. 5622

To amend the Energy Policy Act of 2005 to establish an energy efficient 
  appliance rebate program to provide rebates for the manufacturing, 
   distribution, contracting, installation, and servicing of certain 
 building electrification products and industrial heat pumps, and for 
                            other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

            December 19 (legislative day, December 16), 2024

Mr. Markey (for himself and Mr. Sanders) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL

 
To amend the Energy Policy Act of 2005 to establish an energy efficient 
  appliance rebate program to provide rebates for the manufacturing, 
   distribution, contracting, installation, and servicing of certain 
 building electrification products and industrial heat pumps, and for 
                            other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Installing Clean Efficient Energy 
Hastens Our Transition Act of 2024'' or the ``ICEE HOT Act of 2024''.

SEC. 2. ENERGY EFFICIENT APPLIANCE REBATE PROGRAM.

    (a) Definitions.--Section 124(a) of the Energy Policy Act of 2005 
(42 U.S.C. 15821(a)) is amended--
            (1) by redesignating paragraphs (1) through (5) as 
        paragraphs (8), (9), (15), (17), and (18), respectively;
            (2) by inserting before paragraph (8) (as so redesignated) 
        the following:
            ``(1) Contractor.--The term `contractor' means any 
        individual or business entity that is licensed under applicable 
        State or local laws to install, service, maintain, or repair 
        eligible building electrification products, including general 
        contractors, electricians, HVAC specialists, and plumbers 
        engaged in the installation and servicing of energy-efficient 
        appliances.
            ``(2) Disadvantaged business.--The term `disadvantaged 
        business' means a contractor, distributor, or original 
        equipment manufacturer that is a small business participating 
        in the minority small business and capital ownership 
        development program of the Small Business Administration 
        pursuant to section 8(a) of the Small Business Act (15 U.S.C. 
        637(a)) (commonly known as the `8(a) program').
            ``(3) Disadvantaged individual.--The term `disadvantaged 
        individual' means--
                    ``(A) a Black American, Hispanic American, Native 
                American, Asian Pacific American, any other minority, 
                or any other individual found to be disadvantaged by 
                the Small Business Administration pursuant to section 
                8(a) of the Small Business Act (15 U.S.C. 637(a)); and
                    ``(B) a woman.
            ``(4) Distributor.--The term `distributor' means any 
        individual or business entity to which an eligible building 
        electrification product is delivered or sold for purposes of 
        distribution in commerce.
            ``(5) Electric residential cold climate heat pump.--The 
        term `electric residential cold climate heat pump' means a heat 
        pump that--
                    ``(A) is certified under the Energy Star program;
                    ``(B) is optimized for peak heating and part-load 
                cooling performance; and
                    ``(C) meets--
                            ``(i) the cold climate air source heat pump 
                        specifications of the Northeast Energy 
                        Efficiency Partnerships; or
                            ``(ii) the criteria for cold climate heat 
                        pumps under the Energy Star program.
            ``(6) Electric residential heat pump water heater.--The 
        term `electric residential heat pump water heater' means an 
        electric heat pump water heater for residential use that is 
        certified under the Energy Star program.
            ``(7) Eligible building electrification product.--The term 
        `eligible building electrification product' means any of the 
        following United States-made products or their critical 
        components:
                    ``(A) An electric residential heat pump water 
                heater.
                    ``(B) An electric residential air source heat pump.
                    ``(C) An electric residential central geothermal 
                heat pump.
                    ``(D) An electric residential cold climate heat 
                pump.
                    ``(E) An induction or noninduction electric smooth 
                stove, flat cooktop, range, or oven.
                    ``(F) An electric heat pump clothes dryer that--
                            ``(i) is certified under the Energy Star 
                        program; or
                            ``(ii) meets a more stringent standard, as 
                        determined by the Secretary, if the Secretary 
                        determines a more stringent standard is 
                        appropriate.
                    ``(G) A smart panel or a panel that is part of an 
                electric load or service center upgrade.
                    ``(H) Any product described in subparagraphs (A) 
                through (G) installed in a commercial or multifamily 
                building, subject to the condition that the product 
                meets applicable performance standards, as determined 
                by the Secretary.
                    ``(I) Any other electric product, as determined by 
                the Secretary.'';
            (3) by inserting after paragraph (9) (as so redesignated) 
        the following:
            ``(10) Industrial heat pump.--The term `industrial heat 
        pump' means a high-capacity heat pump that--
                    ``(A) is capable of providing thermal energy at 
                temperatures above 65 degrees Celsius or 150 degrees 
                Fahrenheit, suitable for industrial processes, 
                including manufacturing processing, drying, 
                distillation, pasteurization, and steam production;
                    ``(B) incorporates technology that--
                            ``(i) enables waste heat recovery or energy 
                        reuse, if feasible, and conversion to useful 
                        thermal output; and
                            ``(ii) adheres to specifications 
                        established by the Secretary to ensure thermal 
                        efficiency and reduce carbon emissions; and
                    ``(C) meets recognized performance and efficiency 
                standards for industrial applications, as defined by 
                the American Society of Heating, Refrigerating, and 
                Air-Conditioning Engineers, or equivalent industry 
                standards as specified by the Secretary.
            ``(11) Midstream rebate.--The term `midstream rebate' means 
        a rebate provided by a State to a distributor or contractor 
        under a State program described in subsection (b)(1)(A)(ii).
            ``(12) Original equipment manufacturer.--The term `original 
        equipment manufacturer' means an entity that manufactures 
        eligible building electrification products.
            ``(13) Residential air source heat pump.--The term 
        `residential air source heat pump' means a heat pump or central 
        air conditioner (as defined in section 321(21) of the Energy 
        Policy and Conservation Act (42 U.S.C. 6291(21))) that--
                    ``(A) notwithstanding subparagraph (E) of that 
                section, is a heating and cooling unit and includes 
                both ducted and ductless configurations; and
                    ``(B) is certified under the Energy Star program.
            ``(14) Residential central geothermal heat pump.--The term 
        `residential central geothermal heat pump' means equipment 
        designed for residential use that--
                    ``(A) uses the ground or groundwater as a thermal 
                energy source to provide heating and cooling; and
                    ``(B) is certified under the Energy Star program or 
                meets efficiency and performance standards established 
                by the Secretary.'';
            (4) by inserting after paragraph (15) (as so redesignated) 
        the following:
            ``(16) Smart panel.--The term `smart panel' means an 
        electrical power distribution panel with an integrated 
        communications and energy management system capable of--
                    ``(A) interoperability with electric utility 
                distribution networks; and
                    ``(B) monitoring and controlling individual 
                circuits to ensure that the total load on the 
                electrical service does not exceed a programmed set-
                point.'';
            (5) in paragraph (18) (as so redesignated), by striking 
        ``(b)(1)'' and inserting ``(b)(1)(A)''; and
            (6) by adding at the end the following:
            ``(19) United states-made.--
                    ``(A) In general.--The term `United States-made', 
                with respect to an eligible building electrification 
                product, means that the total cost of components of the 
                eligible building electrification product that are 
                mined, produced, or manufactured, as applicable, in the 
                United States, as determined by the Secretary, is not 
                less than 55 percent of the total cost of all of the 
                components of the eligible building electrification 
                product, unless a waiver is made in accordance with 
                subparagraph (B).
                    ``(B) Waiver.--
                            ``(i) In general.--The Secretary may waive 
                        the requirement under subparagraph (A) where 
                        the term `United States-made' is used in this 
                        subtitle if the Secretary finds that--
                                    ``(I) applying the requirement 
                                would be inconsistent with the public 
                                interest;
                                    ``(II) 1 or more components of the 
                                eligible building electrification 
                                product are not produced in the United 
                                States in sufficient and reasonably 
                                available quantities or of a 
                                satisfactory quality; or
                                    ``(III) the inclusion of 1 or more 
                                components of the eligible building 
                                electrification product produced in the 
                                United States will increase the cost of 
                                the building electrification product by 
                                more than 25 percent.
                            ``(ii) Written justification.--Before 
                        issuing a waiver under clause (i), the 
                        Secretary shall--
                                    ``(I) make publicly available in an 
                                easily accessible location on a website 
                                designated by the Office of Management 
                                and Budget and on the website of the 
                                Department of Energy a detailed written 
                                explanation for the proposed 
                                determination to issue the waiver; and
                                    ``(II) provide a period of not less 
                                than 15 days for public comment on the 
                                proposed waiver.
            ``(20) Upstream rebate.--The term `upstream rebate' means a 
        rebate provided by a State to a distributor or original 
        equipment manufacturer under a State program described in 
        subsection (b)(1)(A)(ii).''.
    (b) Program.--Section 124 of the Energy Policy Act of 2005 (42 
U.S.C. 15821) is amended--
            (1) in subsection (b)--
                    (A) by redesignating paragraphs (1) through (3) as 
                subparagraphs (A) through (C), respectively, and 
                indenting appropriately;
                    (B) in the matter preceding subparagraph (A) (as so 
                redesignated), by striking ``A State'' and inserting 
                the following:
            ``(1) In general.--A State'';
                    (C) in subparagraph (A) (as so redesignated)--
                            (i) by striking ``program to provide'' and 
                        inserting the following: ``program--
                            ``(i) to provide'';
                            (ii) in clause (i) (as so designated), by 
                        adding ``or'' at the end after the semicolon; 
                        and
                            (iii) by adding at the end the following:
                            ``(ii) to provide midstream rebates and 
                        upstream rebates to contractors, distributors, 
                        and original equipment manufacturers, as 
                        applicable, for 30 percent of the cost of 
                        manufacturing, distributing, installing, or 
                        servicing an eligible building electrification 
                        product or product component or an industrial 
                        heat pump;''; and
                    (D) by adding at the end the following:
            ``(2) Purposes.--The purpose of the rebates described in 
        paragraph (1)(A)(ii) are--
                    ``(A) to resolve barriers that limit the efficient 
                production, distribution, and deployment of eligible 
                building electrification products and industrial heat 
                pumps, including--
                            ``(i) by increasing the production and 
                        availability of residential and industrial-
                        grade critical components, such as reversing 
                        valves, variable speed compressors, or other 
                        parts necessary for proper functionality in 
                        both heating and cooling modes; and
                            ``(ii) addressing other factors, such as 
                        market challenges, product technical 
                        requirements, and environmental and equity 
                        goals, with respect to those barriers, as 
                        determined by the Secretary, through the public 
                        stakeholder process described in subsection 
                        (g); and
                    ``(B) in the case of contractors installing 
                eligible building electrification products and 
                industrial heat pumps--
                            ``(i) encourages the installation of 
                        appropriately sized heat pumps or other 
                        electrification products to encourage the 
                        adoption of right-sized and energy-efficient 
                        technologies; and
                            ``(ii) supports the passing through of 
                        rebates to end users, to the extent 
                        practicable.'';
            (2) in subsection (c)(1), by striking ``subsection (f)'' 
        and inserting ``subsection (h)'';
            (3) in subsection (d)--
                    (A) by striking ``The allocation'' and inserting 
                the following:
            ``(1) In general.--The allocation''; and
                    (B) by adding at the end the following:
            ``(2) Disadvantaged businesses and individuals.--Of the 
        amount used by a State to carry out a State program described 
        in subsection (b)(1)(A)(ii), to the extent practicable for 
        specific technologies, as determined by the Secretary, not less 
        than 40 percent shall be used to provide midstream rebates and 
        upstream rebates--
                    ``(A) to disadvantaged businesses; or
                    ``(B) to contractors, distributors, or original 
                equipment manufacturers 40 percent of the employees of 
                which are disadvantaged individuals.'';
            (4) in subsection (e)--
                    (A) by redesignating paragraphs (1) through (3) as 
                subparagraphs (A), (C), and (D), respectively, and 
                indenting appropriately;
                    (B) in the matter preceding subparagraph (A) (as so 
                redesignated), by striking ``Rebates'' in the first 
                sentence and all that follows through ``The amount'' in 
                the second sentence and inserting the following:
            ``(1) In general.--Rebates may be provided to--
                    ``(A) residential consumers that meet the 
                requirements of the applicable State program described 
                in subsection (b)(1)(A); and
                    ``(B) contractors, distributors, and original 
                equipment manufacturers of eligible building 
                electrification products and industrial heat pumps that 
                meet the requirements of the State program described in 
                clause (ii) of that subsection.
            ``(2) Amount.--The amount'';
                    (C) in paragraph (2) (as so designated)--
                            (i) in the matter preceding subparagraph 
                        (A) (as so redesignated)--
                                    (I) by inserting ``under a State 
                                program described in subsection 
                                (b)(1)(A)(i)'' after ``rebate''; and
                                    (II) by striking ``consideration--
                                '' and inserting ``consideration, as 
                                applicable--''; and
                            (ii) by inserting after subparagraph (A) 
                        (as so redesignated) the following:
                    ``(B) the amount of any Federal or State tax 
                incentive available for the manufacturing, 
                distribution, or installation of eligible building 
                electrification products and industrial heat pumps, 
                including tax credits or rebates offered under--
                            ``(i) section 25C, 45L, or 48C of the 
                        Internal Revenue Code of 1986;
                            ``(ii) a HOMES rebate program (as defined 
                        in section 50121(d) of Public Law 117-169 
                        (commonly known as the `Inflation Reduction Act 
                        of 2022') (42 U.S.C. 18795(d))); or
                            ``(iii) a high-efficiency electric home 
                        rebate program (as defined in section 50122(d) 
                        of that Act (42 U.S.C. 18795a(d)));''; and
                    (D) by adding at the end the following:
            ``(3) Additional rebates.--
                    ``(A) Union labor.--Under a State program described 
                in subsection (b)(1)(A)(ii), a State energy office 
                shall provide an additional incentive of 10 percent of 
                the midstream or upstream rebate value to contractors, 
                distributors, and original equipment manufacturers, as 
                applicable, that operate under a collective bargaining 
                agreement negotiated by a labor organization (as 
                defined in section 2 of the National Labor Relations 
                Act (29 U.S.C. 152)) in accordance with the 
                requirements of section 9 of the National Labor 
                Relations Act (29 U.S.C. 159).
                    ``(B) High-efficiency building electrification 
                products.--Under a State program described in 
                subsection (b)(1)(A)(ii), a State energy office shall 
                provide additional rebates of not more than 10 percent 
                of the cost of manufacturing, distributing, installing, 
                or servicing an eligible building electrification 
                product that exceeds baseline standards under the 
                Energy Star program or other efficiency benchmarks 
                approved by the Secretary.
                    ``(C) High-efficiency industrial heat pumps.--Under 
                a State program described in subsection (b)(1)(A)(ii), 
                a State energy office shall provide additional rebates 
                of not more than 10 percent of the cost of 
                manufacturing, distributing, installing, or servicing 
                an industrial heat pump based on system capacity, 
                energy savings, emissions reduction, and heat recovery 
                functions that exceed baseline standards for industrial 
                energy efficiency, as determined by the State energy 
                office.'';
            (5) by redesignating subsection (f) as subsection (h);
            (6) by inserting after subsection (e) the following:
    ``(f) Administrative Requirements for Recipients of Midstream and 
Upstream Rebates.--
            ``(1) Pass-through.--
                    ``(A) In general.--Under a State program described 
                in subsection (b)(1)(A)(ii), as a condition of receipt 
                of a midstream rebate or upstream rebate, a contractor, 
                distributor, or original equipment manufacturer shall 
                pass through not less than 85 percent of the value of 
                the midstream rebate or upstream rebate, as applicable, 
                to the next entity in the supply chain or the end 
                consumer in the form of a reduced price for the 
                purchase of an eligible building electrification 
                product or an industrial heat pump.
                    ``(B) Use of remainder.--After carrying out 
                subparagraph (A), a contractor, distributor, or 
                original equipment manufacturer may retain not more 
                than 15 percent of the remainder of the applicable 
                midstream rebate or upstream rebate.
            ``(2) Participation in multiple building electrification 
        and heat pump programs.--
                    ``(A) In general.--The Secretary, in consultation 
                with the Secretary of the Treasury, shall issue 
                guidelines to simplify participation in a State program 
                described in subsection (b)(1)(A)(ii) and any other 
                Federal or State rebate or tax credit program relating 
                to energy efficiency upgrades, building electrification 
                products, and industrial heat pumps--
                            ``(i) to ensure that eligible entities can 
                        receive all applicable rebates and tax credits; 
                        and
                            ``(ii) to minimize administrative hurdles 
                        by providing clear guidance on incentive 
                        stacking and documentation requirements 
                        consistent with Federal and State building 
                        electrification product and industrial heat 
                        pump standards.
                    ``(B) Automatic application.--If a rebate is 
                claimed by an eligible entity under a State program 
                described in subsection (b)(1)(A)(ii), any other 
                Federal rebate for which the entity would be eligible 
                relating to energy efficiency upgrades, building 
                electrification products, or industrial heat pumps, as 
                applicable, shall automatically apply.
            ``(3) Coordination.--An entity that receives a midstream 
        rebate or upstream rebate for an eligible building 
        electrification product or industrial heat pump under a State 
        program described in subsection (b)(1)(A)(ii) is encouraged to 
        coordinate with Federal and State agencies, utilities, 
        nonprofit organizations, and other entities carrying out other 
        relevant Federal or State rebate programs.
            ``(4) No multiple midstream and upstream rebates.--An 
        entity that receives a midstream rebate or upstream rebate 
        under a State program described in subsection (b)(1)(A)(ii) for 
        an eligible building electrification product may not receive--
                    ``(A) an upstream rebate or midstream rebate, 
                respectively, for the same eligible building 
                electrification product; or
                    ``(B) a second midstream rebate or upstream rebate, 
                respectively, for the same eligible building 
                electrification product.
            ``(5) Taxation.--A midstream rebate or upstream rebate 
        under a State program described in subsection (b)(1)(A)(ii) 
        shall not be considered to be gross income of the recipient of 
        the rebate for purposes of the Internal Revenue Code of 1986.
    ``(g) Public Stakeholder Process.--
            ``(1) In general.--The Secretary shall establish a process 
        to solicit input from public stakeholders in establishing 
        parameters for a State program described in subsection 
        (b)(1)(A)(ii).
            ``(2) Issues.--The Secretary shall solicit input under the 
        process established under paragraph (1) on the following 
        issues:
                    ``(A) Meeting the purposes described in subsection 
                (b)(2).
                    ``(B) Boosting production and availability of 
                residential and industrial heat pumps.
                    ``(C) Parameters for rebate structure and 
                eligibility requirements.
                    ``(D) Technical standards, especially for 
                industrial heat pumps and new residential heat pump 
                technology not covered under the Energy Star program.
                    ``(E) Any other relevant issue, as determined by 
                the Secretary.''; and
            (7) in subsection (h) (as so redesignated)--
                    (A) by striking ``There are'' and inserting the 
                following:
            ``(1) In general.--There are''; and
                    (B) by adding at the end the following:
            ``(2) Additional authorization of appropriations.--There is 
        authorized to be appropriated to the Secretary, to provide 
        allocations under subsection (c) only to States that have 
        established a State program described in subsection 
        (b)(1)(A)(ii), $10,000,000,000 for the period of fiscal years 
        2025 through 2032.''.
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