II

107TH CONGRESS

1ST SESSION S. 1006

To provide for the energy security of the United States and promote environmental quality by enhancing the use of motor vehicle fuels from renewable sources, and for other purposes.

IN THE SENATE OF THE UNITED STATES

JUNE 8, 2001

Mr. HAGEL (for himself and Mr. JOHNSON) introduced the following bill;

which was read twice and referred to the Committee on Energy and Natural Resources

A BILL

To provide for the energy security of the United States

and promote environmental quality by enhancing the use

of motor vehicle fuels from renewable sources, and for

other purposes.

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

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Renewable Fuels for

5 Energy Security Act of 2001’’.

6 SEC. 2. RENEWABLE CONTENT OF MOTOR VEHICLE FUEL.

7 (a) DEFINITIONS.—In this section:
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1 (1) BIODIESEL.—The term ‘‘biodiesel’’ means

2 mono alkyl esters of long chain fatty acids derived

3 from renewable liquid sources such as vegetable oils

4 or animal fats, for use in compression-ignition (die5 sel) engines.

6 (2) BIOGAS.—The term ‘‘biogas’’ means gas

7 produced from a biogas source.

8 (3) BIOGAS SOURCE.—The term ‘‘biogas

9 source’’ means—

10 (A) a landfill;

11 (B) a sewage waste treatment plant;

12 (C) a feedlot; and

13 (D) any other accumulation of decaying or14 ganic material.

15 (4) BIOMASS.—

16 (A) IN GENERAL.—The term ‘‘biomass’’

17 means lignocellulosic or hemicellulosic matter

18 that is available on a renewable basis.

19 (B) INCLUSIONS.—The term ‘‘biomass’’

20 includes—

21 (i) dedicated energy crops and trees;

22 (ii) wood and wood residues;

23 (iii) plants;

24 (iv) grasses;
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1 (v) agricultural commodities and resi2 dues;

3 (vi) fibers; and

4 (vii) animal waste, municipal solid

5 waste, and other waste.

6 (5) BIOMASS ETHANOL.—The term ‘‘biomass

7 ethanol’’ means ethanol derived from biomass.

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

9 fuel’’ means fuel that—

10 (A) is—

11 (i) biodiesel;

12 (ii) ethanol or any other liquid fuel

13 produced from biomass; or

14 (iii) biogas; and

15 (B) is used to reduce the quantity of fossil

16 fuel present in a fuel mixture used to operate

17 a motor vehicle.

18 (7) SECRETARY.—The term ‘‘Secretary’’ means

19 the Secretary of Energy.

20 (b) RENEWABLE FUEL PROGRAM.—

21 (1) PROGRAM REQUIREMENTS.—The motor ve22 hicle fuel sold or introduced into commerce in the

23 United States in calendar year 2002 or any calendar

24 year thereafter by a refiner, blender, or importer

25 shall, on a 6-month average basis, be comprised of
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1 a quantity of renewable fuel, measured in gasoline2 equivalent gallons (as determined by the Secretary),

3 that is not less than the applicable percentage by

4 volume for the 6-month period.

5 (2) APPLICABLE PERCENTAGE.—

6 (A) IN GENERAL.—For the purposes of

7 paragraph (1), the applicable percentage for a

8 6-month period of a calendar year shall be de9 termined in accordance with the following table,

10 unless modified under subparagraph (B):

Calendar year: Applicable percentage of

renewable fuel:

2002 ......................................................................................... .8

2003 ......................................................................................... .9

2004 ......................................................................................... 1.1

2005 ......................................................................................... 1.3

2006 ......................................................................................... 1.5

2007 ......................................................................................... 1.7

2008 ......................................................................................... 2.0

2009 ......................................................................................... 2.3

2010 ......................................................................................... 2.6

2011 ......................................................................................... 3.0

2012 ......................................................................................... 3.42

2013 ......................................................................................... 3.84

2014 ......................................................................................... 4.24

2015 ......................................................................................... 4.63

2016 and thereafter ................................................................. 5.00.

11 (B) ADJUSTMENTS TO APPLICABLE PER12 CENTAGE.—On petition by a State, the Sec13 retary, in consultation with the Secretary of Ag14 riculture, may lower the applicable percentage

15 specified in subparagraph (A) for a period of 1

16 calendar year with respect to motor vehicle fuel

17 sold or introduced into commerce in the State,
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1 based on a determination by the Secretary,

2 after public notice and opportunity for com3 ment, that during the calendar year there is

4 likely to be an inadequate domestic supply or

5 distribution capacity in the State to meet the

6 applicable percentage specified in subparagraph

7 (A) for the calendar year.

8 (C) PETITIONS FOR ADJUSTMENT.—

9 (i) SUBMISSION.—A State shall sub10 mit a petition under subparagraph (B) not

11 later than September 1 of the year pre12 ceding the calendar year for which the ad13 justment is sought.

14 (ii) ACTION ON PETITIONS.—The Sec15 retary, in consultation with the Secretary

16 of Agriculture, shall approve or deny a

17 State petition before the beginning of the

18 calendar year.

19 (c) CREDIT PROGRAM.—

20 (1) IN GENERAL.—Not later than 270 days

21 after the date of enactment of this Act, the Sec22 retary shall promulgate regulations providing for the

23 generation of an appropriate amount of credits by a

24 person that refines, blends, or imports motor vehicle

25 fuel that contains, on a 6-month average basis, a
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1 quantity of renewable fuel that is greater than the

2 quantity required for that 6-month period under

3 subsection (b).

4 (2) USE OF CREDITS.—A person that generates

5 credits under paragraph (1) may use the credits,

6 hold the credits for later use, or transfer all or a

7 portion of the credits to another person, for the pur8 pose of complying with subsection (b).

9 (3) EXPIRATION OF CREDITS.—A credit gen10 erated under this subsection shall expire 2 years

11 after the date on which the credit was generated.

12 (4) INABILITY TO PURCHASE SUFFICIENT

13 CREDITS.—The regulations under paragraph (1)

14 shall include provisions allowing a refiner, blender,

15 or importer that is unable to purchase sufficient

16 credits to meet the requirements of subsection (b) to

17 enter into an enforceable agreement to generate or

18 purchase sufficient credits to make up for any defi19 ciency within a period of time specified in the agree20 ment.

21 (5) TESTING; REPORTS.—The regulations under

22 paragraph (1) may include provisions requiring a re23 finer, blender, or importer—
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1 (A) to conduct tests to ascertain the com2 position of fuels for the purpose of compliance

3 with subsection (b); and

4 (B) to submit to the Secretary periodic re5 ports on the composition of the fuels refined,

6 blended, or imported.

7 (d) CIVIL PENALTIES AND ENFORCEMENT.—

8 (1) CIVIL PENALTIES.—

9 (A) IN GENERAL.—The Secretary may im10 pose against a person that fails to comply with

11 subsection (b) or with a regulation under sub12 section (c) a civil penalty in the amount of—

13 (i) not more than $25,000 for each

14 day of the failure to comply; plus

15 (ii) the amount of economic benefit

16 realized by the person as a result of the

17 failure to comply.

18 (B) AVERAGING PERIOD.—Any failure to

19 comply with respect to a regulation under sub20 section (c) that establishes a regulatory require21 ment based on an averaging period shall con22 stitute a separate day of failure of compliance

23 for each day of the averaging period.

24 (2) ENFORCEMENT.—The Secretary may bring

25 a civil action in United States district court for—
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1 (A) an order enjoining a failure to comply

2 with subsection (b) or with a regulation under

3 subsection (c); and

4 (B) other appropriate relief.

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