[109th Congress Public Law 58]

[From the U.S. Government Printing Office]

[DOCID: f:publ058.109]

[[Page 593]]

 ENERGY POLICY ACT OF 2005

[[Page 119 STAT. 594]]

Public Law 109-58

109th Congress

 An Act

 To ensure jobs for our future with secure, affordable, and reliable 

 energy. <<NOTE: Aug. 8, 2005 - [H.R. 6]>> 

 Be it enacted by the Senate and House of Representatives of the 

United States of America in <<NOTE: Energy Policy Act of 2005. 42 USC 

15801 note.>> Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

 (a) Short Title.--This Act may be cited as the ``Energy Policy Act 

of 2005''.

 (b) Table of Contents.--The table of contents for this Act is as 

follows:

Sec. 1. Short title; table of contents.

 TITLE I--ENERGY EFFICIENCY

 Subtitle A--Federal Programs

Sec. 101. Energy and water saving measures in congressional buildings.

Sec. 102. Energy management requirements.

Sec. 103. Energy use measurement and accountability.

Sec. 104. Procurement of energy efficient products.

Sec. 105. Energy savings performance contracts.

Sec. 106. Voluntary commitments to reduce industrial energy intensity.

Sec. 107. Advanced Building Efficiency Testbed.

Sec. 108. Increased use of recovered mineral component in federally 

 funded projects involving procurement of cement or concrete.

Sec. 109. Federal building performance standards.

Sec. 110. Daylight savings.

Sec. 111. Enhancing energy efficiency in management of Federal lands.

 Subtitle B--Energy Assistance and State Programs

Sec. 121. Low-income home energy assistance program.

Sec. 122. Weatherization assistance.

Sec. 123. State energy programs.

Sec. 124. Energy efficient appliance rebate programs.

Sec. 125. Energy efficient public buildings.

Sec. 126. Low income community energy efficiency pilot program.

Sec. 127. State Technologies Advancement Collaborative.

Sec. 128. State building energy efficiency codes incentives.

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 Subtitle C--Energy Efficient Products

Sec. 131. Energy Star program.

Sec. 132. HVAC maintenance consumer education program.

Sec. 133. Public energy education program.

Sec. 134. Energy efficiency public information initiative.

Sec. 135. Energy conservation standards for additional products.

Sec. 136. Energy conservation standards for commercial equipment.

Sec. 137. Energy labeling.

Sec. 138. Intermittent escalator study.

Sec. 139. Energy efficient electric and natural gas utilities study.

Sec. 140. Energy efficiency pilot program.

Sec. 141. Report on failure to comply with deadlines for new or revised 

 energy 

 conservation standards.

 Subtitle D--Public Housing

Sec. 151. Public housing capital fund.

[[Page 119 STAT. 595]]

Sec. 152. Energy-efficient appliances.

Sec. 153. Energy efficiency standards.

Sec. 154. Energy strategy for HUD.

 TITLE II--RENEWABLE ENERGY

 Subtitle A--General Provisions

Sec. 201. Assessment of renewable energy resources.

Sec. 202. Renewable energy production incentive.

Sec. 203. Federal purchase requirement.

Sec. 204. Use of photovoltaic energy in public buildings.

Sec. 205. Biobased products.

Sec. 206. Renewable energy security.

Sec. 207. Installation of photovoltaic system.

Sec. 208. Sugar cane ethanol program.

Sec. 209. Rural and remote community electrification grants.

Sec. 210. Grants to improve the commercial value of forest biomass for 

 electric energy, useful heat, transportation fuels, and other 

 commercial purposes.

Sec. 211. Sense of Congress regarding generation capacity of electricity 

 from renewable energy resources on public lands.

 Subtitle B--Geothermal Energy

Sec. 221. Short title.

Sec. 222. Competitive lease sale requirements.

Sec. 223. Direct use.

Sec. 224. Royalties and near-term production incentives.

Sec. 225. Coordination of geothermal leasing and permitting on Federal 

 lands.

Sec. 226. Assessment of geothermal energy potential.

Sec. 227. Cooperative or unit plans.

Sec. 228. Royalty on byproducts.

Sec. 229. Authorities of Secretary to readjust terms, conditions, 

 rentals, and royalties.

Sec. 230. Crediting of rental toward royalty.

Sec. 231. Lease duration and work commitment requirements.

Sec. 232. Advanced royalties required for cessation of production.

Sec. 233. Annual rental.

Sec. 234. Deposit and use of geothermal lease revenues for 5 fiscal 

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 years.

Sec. 235. Acreage limitations.

Sec. 236. Technical amendments.

Sec. 237. Intermountain West Geothermal Consortium.

 Subtitle C--Hydroelectric

Sec. 241. Alternative conditions and fishways.

Sec. 242. Hydroelectric production incentives.

Sec. 243. Hydroelectric efficiency improvement.

Sec. 244. Alaska State jurisdiction over small hydroelectric projects.

Sec. 245. Flint Creek hydroelectric project.

Sec. 246. Small hydroelectric power projects.

 Subtitle D--Insular Energy

Sec. 251. Insular areas energy security.

Sec. 252. Projects enhancing insular energy independence.

 TITLE III--OIL AND GAS

 Subtitle A--Petroleum Reserve and Home Heating Oil

Sec. 301. Permanent authority to operate the Strategic Petroleum Reserve 

 and other energy programs.

Sec. 302. National Oilheat Research Alliance.

Sec. 303. Site selection.

 Subtitle B--Natural Gas

Sec. 311. Exportation or importation of natural gas.

Sec. 312. New natural gas storage facilities.

Sec. 313. Process coordination; hearings; rules of procedure.

Sec. 314. Penalties.

Sec. 315. Market manipulation.

Sec. 316. Natural gas market transparency rules.

Sec. 317. Federal-State liquefied natural gas forums.

Sec. 318. Prohibition of trading and serving by certain individuals.

 Subtitle C--Production

Sec. 321. Outer Continental Shelf provisions.

[[Page 119 STAT. 596]]

Sec. 322. Hydraulic fracturing.

Sec. 323. Oil and gas exploration and production defined.

 Subtitle D--Naval Petroleum Reserve

Sec. 331. Transfer of administrative jurisdiction and environmental 

 remediation, Naval Petroleum Reserve Numbered 2, Kern County, 

 California.

Sec. 332. Naval Petroleum Reserve Numbered 2 Lease Revenue Account.

Sec. 333. Land conveyance, portion of Naval Petroleum Reserve Numbered 

 2, to City of Taft, California.

Sec. 334. Revocation of land withdrawal.

 Subtitle E--Production Incentives

Sec. 341. Definition of Secretary.

Sec. 342. Program on oil and gas royalties in-kind.

Sec. 343. Marginal property production incentives.

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Sec. 344. Incentives for natural gas production from deep wells in the 

 shallow waters of the Gulf of Mexico.

Sec. 345. Royalty relief for deep water production.

Sec. 346. Alaska offshore royalty suspension.

Sec. 347. Oil and gas leasing in the National Petroleum Reserve in 

 Alaska.

Sec. 348. North Slope Science Initiative.

Sec. 349. Orphaned, abandoned, or idled wells on Federal land.

Sec. 350. Combined hydrocarbon leasing.

Sec. 351. Preservation of geological and geophysical data.

Sec. 352. Oil and gas lease acreage limitations.

Sec. 353. Gas hydrate production incentive.

Sec. 354. Enhanced oil and natural gas production through carbon dioxide 

 injection.

Sec. 355. Assessment of dependence of State of Hawaii on oil.

Sec. 356. Denali Commission.

Sec. 357. Comprehensive inventory of OCS oil and natural gas resources.

 Subtitle F--Access to Federal Lands

Sec. 361. Federal onshore oil and gas leasing and permitting practices.

Sec. 362. Management of Federal oil and gas leasing programs.

Sec. 363. Consultation regarding oil and gas leasing on public land.

Sec. 364. Estimates of oil and gas resources underlying onshore Federal 

 land.

Sec. 365. Pilot project to improve Federal permit coordination.

Sec. 366. Deadline for consideration of applications for permits.

Sec. 367. Fair market value determinations for linear rights-of-way 

 across public lands and National Forests.

Sec. 368. Energy right-of-way corridors on Federal land.

Sec. 369. Oil shale, tar sands, and other strategic unconventional 

 fuels.

Sec. 370. Finger Lakes withdrawal.

Sec. 371. Reinstatement of leases.

Sec. 372. Consultation regarding energy rights-of-way on public land.

Sec. 373. Sense of Congress regarding development of minerals under 

 Padre Island National Seashore.

Sec. 374. Livingston Parish mineral rights transfer.

 Subtitle G--Miscellaneous

Sec. 381. Deadline for decision on appeals of consistency determination 

 under the Coastal Zone Management Act of 1972.

Sec. 382. Appeals relating to offshore mineral development.

Sec. 383. Royalty payments under leases under the Outer Continental 

 Shelf Lands Act.

Sec. 384. Coastal impact assistance program.

Sec. 385. Study of availability of skilled workers.

Sec. 386. Great Lakes oil and gas drilling ban.

Sec. 387. Federal coalbed methane regulation.

Sec. 388. Alternate energy-related uses on the Outer Continental Shelf.

Sec. 389. Oil Spill Recovery Institute.

Sec. 390. NEPA review.

 Subtitle H--Refinery Revitalization

Sec. 391. Findings and definitions.

Sec. 392. Federal-State regulatory coordination and assistance.

 TITLE IV--COAL

 Subtitle A--Clean Coal Power Initiative

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Sec. 401. Authorization of appropriations.

[[Page 119 STAT. 597]]

Sec. 402. Project criteria.

Sec. 403. Report.

Sec. 404. Clean coal centers of excellence.

 Subtitle B--Clean Power Projects

Sec. 411. Integrated coal/renewable energy system.

Sec. 412. Loan to place Alaska clean coal technology facility in 

 service.

Sec. 413. Western integrated coal gasification demonstration project.

Sec. 414. Coal gasification.

Sec. 415. Petroleum coke gasification.

Sec. 416. Electron scrubbing demonstration.

Sec. 417. Department of Energy transportation fuels from Illinois basin 

 coal.

 Subtitle C--Coal and Related Programs

Sec. 421. Amendment of the Energy Policy Act of 1992.

 Subtitle D--Federal Coal Leases

Sec. 431. Short title.

Sec. 432. Repeal of the 160-acre limitation for coal leases.

Sec. 433. Approval of logical mining units.

Sec. 434. Payment of advance royalties under coal leases.

Sec. 435. Elimination of deadline for submission of coal lease operation 

 and reclamation plan.

Sec. 436. Amendment relating to financial assurances with respect to 

 bonus bids.

Sec. 437. Inventory requirement.

Sec. 438. Application of amendments.

 TITLE V--INDIAN ENERGY

Sec. 501. Short title.

Sec. 502. Office of Indian Energy Policy and Programs.

Sec. 503. Indian energy.

Sec. 504. Consultation with Indian tribes.

Sec. 505. Four Corners transmission line project and electrification.

Sec. 506. Energy efficiency in federally assisted housing.

 TITLE VI--NUCLEAR MATTERS

 Subtitle A--Price-Anderson Act Amendments

Sec. 601. Short title.

Sec. 602. Extension of indemnification authority.

Sec. 603. Maximum assessment.

Sec. 604. Department liability limit.

Sec. 605. Incidents outside the United States.

Sec. 606. Reports.

Sec. 607. Inflation adjustment.

Sec. 608. Treatment of modular reactors.

Sec. 609. Applicability.

Sec. 610. Civil penalties.

 Subtitle B--General Nuclear Matters

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Sec. 621. Licenses.

Sec. 622. Nuclear Regulatory Commission scholarship and fellowship 

 program.

Sec. 623. Cost recovery from Government agencies.

Sec. 624. Elimination of pension offset for certain rehired Federal 

 retirees.

Sec. 625. Antitrust review.

Sec. 626. Decommissioning.

Sec. 627. Limitation on legal fee reimbursement.

Sec. 628. Decommissioning pilot program.

Sec. 629. Whistleblower protection.

Sec. 630. Medical isotope production.

Sec. 631. Safe disposal of greater-than-Class C radioactive waste.

Sec. 632. Prohibition on nuclear exports to countries that sponsor 

 terrorism.

Sec. 633. Employee benefits.

Sec. 634. Demonstration hydrogen production at existing nuclear power 

 plants.

Sec. 635. Prohibition on assumption by United States Government of 

 liability for certain foreign incidents.

Sec. 636. Authorization of appropriations.

Sec. 637. Nuclear Regulatory Commission user fees and annual charges.

Sec. 638. Standby support for certain nuclear plant delays.

Sec. 639. Conflicts of interest relating to contracts and other 

 arrangements.

[[Page 119 STAT. 598]]

 Subtitle C--Next Generation Nuclear Plant Project

Sec. 641. Project establishment.

Sec. 642. Project management.

Sec. 643. Project organization.

Sec. 644. Nuclear Regulatory Commission.

Sec. 645. Project timelines and authorization of appropriations.

 Subtitle D--Nuclear Security

Sec. 651. Nuclear facility and materials security.

Sec. 652. Fingerprinting and criminal history record checks.

Sec. 653. Use of firearms by security personnel.

Sec. 654. Unauthorized introduction of dangerous weapons.

Sec. 655. Sabotage of nuclear facilities, fuel, or designated material.

Sec. 656. Secure transfer of nuclear materials.

Sec. 657. Department of Homeland Security consultation.

 TITLE VII--VEHICLES AND FUELS

 Subtitle A--Existing Programs

Sec. 701. Use of alternative fuels by dual fueled vehicles.

Sec. 702. Incremental cost allocation.

Sec. 703. Alternative compliance and flexibility.

Sec. 704. Review of Energy Policy Act of 1992 programs.

Sec. 705. Report concerning compliance with alternative fueled vehicle 

 purchasing requirements.

Sec. 706. Joint flexible fuel/hybrid vehicle commercialization 

 initiative.

Sec. 707. Emergency exemption.

 Subtitle B--Hybrid Vehicles, Advanced Vehicles, and Fuel Cell Buses

 Part 1--Hybrid Vehicles

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Sec. 711. Hybrid vehicles.

Sec. 712. Efficient hybrid and advanced diesel vehicles.

 Part 2--Advanced Vehicles

Sec. 721. Pilot program.

Sec. 722. Reports to Congress.

Sec. 723. Authorization of appropriations.

 Part 3--Fuel Cell Buses

Sec. 731. Fuel cell transit bus demonstration.

 Subtitle C--Clean School Buses

Sec. 741. Clean school bus program.

Sec. 742. Diesel truck retrofit and fleet modernization program.

Sec. 743. Fuel cell school buses.

 Subtitle D--Miscellaneous

Sec. 751. Railroad efficiency.

Sec. 752. Mobile emission reductions trading and crediting.

Sec. 753. Aviation fuel conservation and emissions.

Sec. 754. Diesel fueled vehicles.

Sec. 755. Conserve by Bicycling Program.

Sec. 756. Reduction of engine idling.

Sec. 757. Biodiesel engine testing program.

Sec. 758. Ultra-efficient engine technology for aircraft.

Sec. 759. Fuel economy incentive requirements.

 Subtitle E--Automobile Efficiency

Sec. 771. Authorization of appropriations for implementation and 

 enforcement of fuel economy standards.

Sec. 772. Extension of maximum fuel economy increase for alternative 

 fueled vehicles.

Sec. 773. Study of feasibility and effects of reducing use of fuel for 

 automobiles.

Sec. 774. Update testing procedures.

 Subtitle F--Federal and State Procurement

Sec. 781. Definitions.

Sec. 782. Federal and State procurement of fuel cell vehicles and 

 hydrogen energy systems.

[[Page 119 STAT. 599]]

Sec. 783. Federal procurement of stationary, portable, and micro fuel 

 cells.

 Subtitle G--Diesel Emissions Reduction

Sec. 791. Definitions.

Sec. 792. National grant and loan programs.

Sec. 793. State grant and loan programs.

Sec. 794. Evaluation and report.

Sec. 795. Outreach and incentives.

Sec. 796. Effect of subtitle.

Sec. 797. Authorization of appropriations.

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 TITLE VIII--HYDROGEN

Sec. 801. Hydrogen and fuel cell program.

Sec. 802. Purposes.

Sec. 803. Definitions.

Sec. 804. Plan.

Sec. 805. Programs.

Sec. 806. Hydrogen and Fuel Cell Technical Task Force.

Sec. 807. Technical Advisory Committee.

Sec. 808. Demonstration.

Sec. 809. Codes and standards.

Sec. 810. Disclosure.

Sec. 811. Reports.

Sec. 812. Solar and wind technologies.

Sec. 813. Technology transfer.

Sec. 814. Miscellaneous provisions.

Sec. 815. Cost sharing.

Sec. 816. Savings clause.

 TITLE IX--RESEARCH AND DEVELOPMENT

Sec. 901. Short title.

Sec. 902. Goals.

Sec. 903. Definitions.

 Subtitle A--Energy Efficiency

Sec. 911. Energy efficiency.

Sec. 912. Next Generation Lighting Initiative.

Sec. 913. National Building Performance Initiative.

Sec. 914. Building standards.

Sec. 915. Secondary electric vehicle battery use program.

Sec. 916. Energy Efficiency Science Initiative.

Sec. 917. Advanced Energy Efficiency Technology Transfer Centers.

 Subtitle B--Distributed Energy and Electric Energy Systems

Sec. 921. Distributed energy and electric energy systems.

Sec. 922. High power density industry program.

Sec. 923. Micro-cogeneration energy technology.

Sec. 924. Distributed energy technology demonstration programs.

Sec. 925. Electric transmission and distribution programs.

 Subtitle C--Renewable Energy

Sec. 931. Renewable energy.

Sec. 932. Bioenergy program.

Sec. 933. Low-cost renewable hydrogen and infrastructure for vehicle 

 propulsion.

Sec. 934. Concentrating solar power research program.

Sec. 935. Renewable energy in public buildings.

 Subtitle D--Agricultural Biomass Research and Development Programs

Sec. 941. Amendments to the Biomass Research and Development Act of 

 2000.

Sec. 942. Production incentives for cellulosic biofuels.

Sec. 943. Procurement of biobased products.

Sec. 944. Small business bioproduct marketing and certification grants.

Sec. 945. Regional bioeconomy development grants.

Sec. 946. Preprocessing and harvesting demonstration grants.

Sec. 947. Education and outreach.

Sec. 948. Reports.

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 Subtitle E--Nuclear Energy

Sec. 951. Nuclear energy.

Sec. 952. Nuclear energy research programs.

[[Page 119 STAT. 600]]

Sec. 953. Advanced fuel cycle initiative.

Sec. 954. University nuclear science and engineering support.

Sec. 955. Department of Energy civilian nuclear infrastructure and 

 facilities.

Sec. 956. Security of nuclear facilities.

Sec. 957. Alternatives to industrial radioactive sources.

 Subtitle F--Fossil Energy

Sec. 961. Fossil energy.

Sec. 962. Coal and related technologies program.

Sec. 963. Carbon capture research and development program.

Sec. 964. Research and development for coal mining technologies.

Sec. 965. Oil and gas research programs.

Sec. 966. Low-volume oil and gas reservoir research program.

Sec. 967. Complex well technology testing facility.

Sec. 968. Methane hydrate research.

 Subtitle G--Science

Sec. 971. Science.

Sec. 972. Fusion energy sciences program.

Sec. 973. Catalysis research program.

Sec. 974. Hydrogen.

Sec. 975. Solid state lighting.

Sec. 976. Advanced scientific computing for energy missions.

Sec. 977. Systems biology program.

Sec. 978. Fission and fusion energy materials research program.

Sec. 979. Energy and water supplies.

Sec. 980. Spallation Neutron Source.

Sec. 981. Rare isotope accelerator.

Sec. 982. Office of Scientific and Technical Information.

Sec. 983. Science and engineering education pilot program.

Sec. 984. Energy research fellowships.

Sec. 984A. Science and technology scholarship program.

 Subtitle H--International Cooperation

Sec. 985. Western Hemisphere energy cooperation.

Sec. 986. Cooperation between United States and Israel.

Sec. 986A. International energy training.

 Subtitle I--Research Administration and Operations

Sec. 987. Availability of funds.

Sec. 988. Cost sharing.

Sec. 989. Merit review of proposals.

Sec. 990. External technical review of Departmental programs.

Sec. 991. National Laboratory designation.

Sec. 992. Report on equal employment opportunity practices.

Sec. 993. Strategy and plan for science and energy facilities and 

 infrastructure.

Sec. 994. Strategic research portfolio analysis and coordination plan.

Sec. 995. Competitive award of management contracts.

Sec. 996. Western Michigan demonstration project.

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Sec. 997. Arctic Engineering Research Center.

Sec. 998. Barrow Geophysical Research Facility.

 Subtitle J--Ultra-Deepwater and Unconventional Natural Gas and Other 

 Petroleum Resources

Sec. 999A. Program authority.

Sec. 999B. Ultra-deepwater and unconventional onshore natural gas and 

 other petroleum research and development program.

Sec. 999C. Additional requirements for awards.

Sec. 999D. Advisory committees.

Sec. 999E. Limits on participation.

Sec. 999F. Sunset.

Sec. 999G. Definitions.

Sec. 999H. Funding.

 TITLE X--DEPARTMENT OF ENERGY MANAGEMENT

Sec. 1001. Improved technology transfer of energy technologies.

Sec. 1002. Technology Infrastructure Program.

Sec. 1003. Small business advocacy and assistance.

Sec. 1004. Outreach.

Sec. 1005. Relationship to other laws.

[[Page 119 STAT. 601]]

Sec. 1006. Improved coordination and management of civilian science and 

 technology programs.

Sec. 1007. Other transactions authority.

Sec. 1008. Prizes for achievement in grand challenges of science and 

 technology.

Sec. 1009. Technical corrections.

Sec. 1010. University collaboration.

Sec. 1011. Sense of Congress.

 TITLE XI--PERSONNEL AND TRAINING

Sec. 1101. Workforce trends and traineeship grants.

Sec. 1102. Educational programs in science and mathematics.

Sec. 1103. Training guidelines for nonnuclear electric energy industry 

 personnel.

Sec. 1104. National Center for Energy Management and Building 

 Technologies.

Sec. 1105. Improved access to energy-related scientific and technical 

 careers.

Sec. 1106. National Power Plant Operations Technology and Educational 

 Center.

 TITLE XII--ELECTRICITY

Sec. 1201. Short title.

 Subtitle A--Reliability Standards

Sec. 1211. Electric reliability standards.

 Subtitle B--Transmission Infrastructure Modernization

Sec. 1221. Siting of interstate electric transmission facilities.

Sec. 1222. Third-party finance.

Sec. 1223. Advanced transmission technologies.

Sec. 1224. Advanced Power System Technology Incentive Program.

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 Subtitle C--Transmission Operation Improvements

Sec. 1231. Open nondiscriminatory access.

Sec. 1232. Federal utility participation in Transmission Organizations.

Sec. 1233. Native load service obligation.

Sec. 1234. Study on the benefits of economic dispatch.

Sec. 1235. Protection of transmission contracts in the Pacific 

 Northwest.

Sec. 1236. Sense of Congress regarding locational installed capacity 

 mechanism.

 Subtitle D--Transmission Rate Reform

Sec. 1241. Transmission infrastructure investment.

Sec. 1242. Funding new interconnection and transmission upgrades.

 Subtitle E--Amendments to PURPA

Sec. 1251. Net metering and additional standards.

Sec. 1252. Smart metering.

Sec. 1253. Cogeneration and small power production purchase and sale 

 requirements.

Sec. 1254. Interconnection.

 Subtitle F--Repeal of PUHCA

Sec. 1261. Short title.

Sec. 1262. Definitions.

Sec. 1263. Repeal of the Public Utility Holding Company Act of 1935.

Sec. 1264. Federal access to books and records.

Sec. 1265. State access to books and records.

Sec. 1266. Exemption authority.

Sec. 1267. Affiliate transactions.

Sec. 1268. Applicability.

Sec. 1269. Effect on other regulations.

Sec. 1270. Enforcement.

Sec. 1271. Savings provisions.

Sec. 1272. Implementation.

Sec. 1273. Transfer of resources.

Sec. 1274. Effective date.

Sec. 1275. Service allocation.

Sec. 1276. Authorization of appropriations.

Sec. 1277. Conforming amendments to the Federal Power Act.

 Subtitle G--Market Transparency, Enforcement, and Consumer Protection

Sec. 1281. Electricity market transparency.

Sec. 1282. False statements.

[[Page 119 STAT. 602]]

Sec. 1283. Market manipulation.

Sec. 1284. Enforcement.

Sec. 1285. Refund effective date.

Sec. 1286. Refund authority.

Sec. 1287. Consumer privacy and unfair trade practices.

Sec. 1288. Authority of court to prohibit individuals from serving as 

 officers, directors, and energy traders.

Sec. 1289. Merger review reform.

Sec. 1290. Relief for extraordinary violations.

 Subtitle H--Definitions

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Sec. 1291. Definitions.

 Subtitle I--Technical and Conforming Amendments

Sec. 1295. Conforming amendments.

 Subtitle J--Economic Dispatch

Sec. 1298. Economic dispatch.

 TITLE XIII--ENERGY POLICY TAX INCENTIVES

Sec. 1300. Short title; amendment to 1986 Code.

 Subtitle A--Electricity Infrastructure

Sec. 1301. Extension and modification of renewable electricity 

 production credit.

Sec. 1302. Application of section 45 credit to agricultural 

 cooperatives.

Sec. 1303. Clean renewable energy bonds.

Sec. 1304. Treatment of income of certain electric cooperatives.

Sec. 1305. Dispositions of transmission property to implement FERC 

 restructuring policy.

Sec. 1306. Credit for production from advanced nuclear power facilities.

Sec. 1307. Credit for investment in clean coal facilities.

Sec. 1308. Electric transmission property treated as 15-year property.

Sec. 1309. Expansion of amortization for certain atmospheric pollution 

 control facilities in connection with plants first placed in 

 service after 1975.

Sec. 1310. Modifications to special rules for nuclear decommissioning 

 costs.

Sec. 1311. Five-year net operating loss carryover for certain losses.

 Subtitle B--Domestic Fossil Fuel Security

Sec. 1321. Extension of credit for producing fuel from a nonconventional 

 source for facilities producing coke or coke gas.

Sec. 1322. Modification of credit for producing fuel from a 

 nonconventional source.

Sec. 1323. Temporary expensing for equipment used in refining of liquid 

 fuels.

Sec. 1324. Pass through to owners of deduction for capital costs 

 incurred by small refiner cooperatives in complying with 

 Environmental Protection Agency sulfur regulations.

Sec. 1325. Natural gas distribution lines treated as 15-year property.

Sec. 1326. Natural gas gathering lines treated as 7-year property.

Sec. 1327. Arbitrage rules not to apply to prepayments for natural gas.

Sec. 1328. Determination of small refiner exception to oil depletion 

 deduction.

Sec. 1329. Amortization of geological and geophysical expenditures.

 Subtitle C--Conservation and Energy Efficiency Provisions

Sec. 1331. Energy efficient commercial buildings deduction.

Sec. 1332. Credit for construction of new energy efficient homes.

Sec. 1333. Credit for certain nonbusiness energy property.

Sec. 1334. Credit for energy efficient appliances.

Sec. 1335. Credit for residential energy efficient property.

Sec. 1336. Credit for business installation of qualified fuel cells and 

 stationary microturbine power plants.

Sec. 1337. Business solar investment tax credit.

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 Subtitle D--Alternative Motor Vehicles and Fuels Incentives

Sec. 1341. Alternative motor vehicle credit.

Sec. 1342. Credit for installation of alternative fueling stations.

Sec. 1343. Reduced motor fuel excise tax on certain mixtures of diesel 

 fuel.

Sec. 1344. Extension of excise tax provisions and income tax credit for 

 biodiesel.

Sec. 1345. Small agri-biodiesel producer credit.

Sec. 1346. Renewable diesel.

Sec. 1347. Modification of small ethanol producer credit.

Sec. 1348. Sunset of deduction for clean-fuel vehicles and certain 

 refueling property.

[[Page 119 STAT. 603]]

 Subtitle E--Additional Energy Tax Incentives

Sec. 1351. Expansion of research credit.

Sec. 1352. National Academy of Sciences study and report.

Sec. 1353. Recycling study.

 Subtitle F--Revenue Raising Provisions

Sec. 1361. Oil Spill Liability Trust Fund financing rate.

Sec. 1362. Extension of Leaking Underground Storage Tank Trust Fund 

 financing rate.

Sec. 1363. Modification of recapture rules for amortizable section 197 

 intangibles.

Sec. 1364. Clarification of tire excise tax.

 TITLE XIV--MISCELLANEOUS

 Subtitle A--In General

Sec. 1401. Sense of Congress on risk assessments.

Sec. 1402. Energy production incentives.

Sec. 1403. Regulation of certain oil used in transformers.

Sec. 1404. Petrochemical and oil refinery facility health assessment.

Sec. 1405. National Priority Project Designation.

Sec. 1406. Cold cracking.

Sec. 1407. Oxygen-fuel.

 Subtitle B--Set America Free

Sec. 1421. Short title.

Sec. 1422. Purpose.

Sec. 1423. United States Commission on North American Energy Freedom.

Sec. 1424. North American energy freedom policy.

 TITLE XV--ETHANOL AND MOTOR FUELS

 Subtitle A--General Provisions

Sec. 1501. Renewable content of gasoline.

Sec. 1502. Findings.

Sec. 1503. Claims filed after enactment.

Sec. 1504. Elimination of oxygen content requirement for reformulated 

 gasoline.

Sec. 1505. Public health and environmental impacts of fuels and fuel 

 additives.

Sec. 1506. Analyses of motor vehicle fuel changes.

Sec. 1507. Additional opt-in areas under reformulated gasoline program.

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Sec. 1508. Data collection.

Sec. 1509. Fuel system requirements harmonization study.

Sec. 1510. Commercial byproducts from municipal solid waste and 

 cellulosic biomass loan guarantee program.

Sec. 1511. Renewable fuel.

Sec. 1512. Conversion assistance for cellulosic biomass, waste-derived 

 ethanol, approved renewable fuels.

Sec. 1513. Blending of compliant reformulated gasolines.

Sec. 1514. Advanced biofuel technologies program.

Sec. 1515. Waste-derived ethanol and biodiesel.

Sec. 1516. Sugar ethanol loan guarantee program.

 Subtitle B--Underground Storage Tank Compliance

Sec. 1521. Short title.

Sec. 1522. Leaking underground storage tanks.

Sec. 1523. Inspection of underground storage tanks.

Sec. 1524. Operator training.

Sec. 1525. Remediation from oxygenated fuel additives.

Sec. 1526. Release prevention, compliance, and enforcement.

Sec. 1527. Delivery prohibition.

Sec. 1528. Federal facilities.

Sec. 1529. Tanks on tribal lands.

Sec. 1530. Additional measures to protect groundwater.

Sec. 1531. Authorization of appropriations.

Sec. 1532. Conforming amendments.

Sec. 1533. Technical amendments.

 Subtitle C--Boutique Fuels

Sec. 1541. Reducing the proliferation of boutique fuels.

 TITLE XVI--CLIMATE CHANGE

 Subtitle A--National Climate Change Technology Deployment

Sec. 1601. Greenhouse gas intensity reducing technology strategies.

[[Page 119 STAT. 604]]

Subtitle B--Climate Change Technology Deployment in Developing Countries

Sec. 1611. Climate change technology deployment in developing countries.

 TITLE XVII--INCENTIVES FOR INNOVATIVE TECHNOLOGIES

Sec. 1701. Definitions.

Sec. 1702. Terms and conditions.

Sec. 1703. Eligible projects.

Sec. 1704. Authorization of appropriations.

 TITLE XVIII--STUDIES

Sec. 1801. Study on inventory of petroleum and natural gas storage.

Sec. 1802. Study of energy efficiency standards.

Sec. 1803. Telecommuting study.

Sec. 1804. LIHEAP Report.

Sec. 1805. Oil bypass filtration technology.

Sec. 1806. Total integrated thermal systems.

Sec. 1807. Report on energy integration with Latin America.

Sec. 1808. Low-volume gas reservoir study.

Sec. 1809. Investigation of gasoline prices.

Sec. 1810. Alaska natural gas pipeline.

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Sec. 1811. Coal bed methane study.

Sec. 1812. Backup fuel capability study.

Sec. 1813. Indian land rights-of-way.

Sec. 1814. Mobility of scientific and technical personnel.

Sec. 1815. Interagency review of competition in the wholesale and retail 

 markets for electric energy.

Sec. 1816. Study of rapid electrical grid restoration.

Sec. 1817. Study of distributed generation.

Sec. 1818. Natural gas supply shortage report.

Sec. 1819. Hydrogen participation study.

Sec. 1820. Overall employment in a hydrogen economy.

Sec. 1821. Study of best management practices for energy research and 

 development programs.

Sec. 1822. Effect of electrical contaminants on reliability of energy 

 production systems.

Sec. 1823. Alternative fuels reports.

Sec. 1824. Final action on refunds for excessive charges.

Sec. 1825. Fuel cell and hydrogen technology study.

Sec. 1826. Passive solar technologies.

Sec. 1827. Study of link between energy security and increases in 

 vehicle miles traveled.

Sec. 1828. Science study on cumulative impacts of multiple offshore 

 liquefied natural gas facilities.

Sec. 1829. Energy and water saving measures in congressional buildings.

Sec. 1830. Study of availability of skilled workers.

Sec. 1831. Review of Energy Policy Act of 1992 programs.

Sec. 1832. Study on the benefits of economic dispatch.

Sec. 1833. Renewable energy on Federal land.

Sec. 1834. Increased hydroelectric generation at existing Federal 

 facilities.

Sec. 1835. Split-estate Federal oil and gas leasing and development 

 practices.

Sec. 1836. Resolution of Federal resource development conflicts in the 

 Powder River Basin.

Sec. 1837. National security review of international energy 

 requirements.

Sec. 1838. Used oil re-refining study.

Sec. 1839. Transmission system monitoring.

Sec. 1840. Report identifying and describing the status of potential 

 hydropower facilities.

SEC. 2. <<NOTE: 42 USC 15801.>> DEFINITIONS.

 Except as otherwise provided, in this Act:

 (1) Department.--The term ``Department'' means the 

 Department of Energy.

 (2) Institution of higher education.--

 (A) In general.--The term ``institution of higher 

 education'' has the meaning given the term in section 

 101(a) of the Higher Education Act of 1065 (20 U.S.C. 

 1001(a)).

 (B) Inclusion.--The term ``institution of higher 

 education'' includes an organization that--

[[Page 119 STAT. 605]]

 (i) is organized, and at all times thereafter 

 operated, exclusively for the benefit of, to 

 perform the functions of, or to carry out the 

 functions of one or more organizations referred to 

 in subparagraph (A); and

 (ii) is operated, supervised, or controlled by 

 or in connection with one or more of those 

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 organizations.

 (3) National laboratory.--The term ``National Laboratory'' 

 means any of the following laboratories owned by the Department:

 (A) Ames Laboratory.

 (B) Argonne National Laboratory.

 (C) Brookhaven National Laboratory.

 (D) Fermi National Accelerator Laboratory.

 (E) Idaho National Laboratory.

 (F) Lawrence Berkeley National Laboratory.

 (G) Lawrence Livermore National Laboratory.

 (H) Los Alamos National Laboratory.

 (I) National Energy Technology Laboratory.

 (J) National Renewable Energy Laboratory.

 (K) Oak Ridge National Laboratory.

 (L) Pacific Northwest National Laboratory.

 (M) Princeton Plasma Physics Laboratory.

 (N) Sandia National Laboratories.

 (O) Savannah River National Laboratory.

 (P) Stanford Linear Accelerator Center.

 (Q) Thomas Jefferson National Accelerator Facility.

 (4) Secretary.--The term ``Secretary'' means the Secretary 

 of Energy.

 (5) Small business concern.--The term ``small business 

 concern'' has the meaning given the term in section 3 of the 

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

 TITLE I--ENERGY EFFICIENCY

 Subtitle A--Federal Programs

SEC. 101. ENERGY AND WATER SAVING MEASURES IN CONGRESSIONAL BUILDINGS.

 (a) In General.--Part 3 of title V of the National Energy 

Conservation Policy Act (42 U.S.C. 8251 et seq.) is amended by adding at 

the end the following:

``SEC. 552. <<NOTE: 42 USC 8259a.>> ENERGY AND WATER SAVINGS MEASURES IN 

 CONGRESSIONAL BUILDINGS.

 ``(a) In General.--The Architect of the Capitol--

 ``(1) shall develop, update, and implement a cost-effective 

 energy conservation and management plan (referred to in this 

 section as the `plan') for all facilities administered by 

 Congress (referred to in this section as `congressional 

 buildings') to meet the energy performance requirements for 

 Federal buildings established under section 543(a)(1); and

 ``(2) <<NOTE: Deadline.>> shall submit the plan to Congress, 

 not later than 180 days after the date of enactment of this 

 section.

 ``(b) Plan Requirements.--The plan shall include--

[[Page 119 STAT. 606]]

 ``(1) a description of the life cycle cost analysis used to 

 determine the cost-effectiveness of proposed energy efficiency 

 projects;

 ``(2) a schedule of energy surveys to ensure complete 

 surveys of all congressional buildings every 5 years to 

 determine the cost and payback period of energy and water 

 conservation measures;

 ``(3) a strategy for installation of life cycle cost-

 effective energy and water conservation measures;

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 ``(4) the results of a study of the costs and benefits of 

 installation of submetering in congressional buildings; and

 ``(5) information packages and `how-to' guides for each 

 Member and employing authority of Congress that detail simple, 

 cost-effective methods to save energy and taxpayer dollars in 

 the workplace.

 ``(c) Annual Report.--The Architect of the Capitol shall submit to 

Congress annually a report on congressional energy management and 

conservation programs required under this section that describes in 

detail--

 ``(1) energy expenditures and savings estimates for each 

 facility;

 ``(2) energy management and conservation projects; and

 ``(3) future priorities to ensure compliance with this 

 section.''.

 (b) Table of Contents Amendment.--The table of contents of the 

National Energy Conservation Policy Act is amended by adding at the end 

of the items relating to part 3 of title V the following new item:

``Sec. 552. Energy and water savings measures in congressional 

 buildings.''.

 (c) Repeal.--Section 310 of the Legislative Branch Appropriations 

Act, 1999 (2 U.S.C. 1815), is repealed.

SEC. 102. ENERGY MANAGEMENT REQUIREMENTS.

 (a) Energy Reduction Goals.--

 (1) Amendment.--Section 543(a)(1) of the National Energy 

 Conservation Policy Act (42 U.S.C. 8253(a)(1)) is amended by 

 striking ``its Federal buildings so that'' and all that follows 

 through the end and inserting ``the Federal buildings of the 

 agency (including each industrial or laboratory facility) so 

 that the energy consumption per gross square foot of the Federal 

 buildings of the agency in fiscal years 2006 through 2015 is 

 reduced, as compared with the energy consumption per gross 

 square foot of the Federal buildings of the agency in fiscal 

 year 2003, by the percentage specified in the following table:

 ``Fiscal Year Percentage reduction......................

 2006........................................ 2 

 2007........................................ 4 

 2008........................................ 6 

 2009........................................ 8 

 2010........................................ 10 

 2011........................................ 12 

 2012........................................ 14 

 2013........................................ 16 

 2014........................................ 18 

 2015........................................ 20.''.

 (2) Reporting baseline.--The <<NOTE: 42 USC 8253 

 note.>> energy reduction goals and baseline established in 

 paragraph (1) of section 543(a) of the

[[Page 119 STAT. 607]]

 National Energy Conservation Policy Act (42 U.S.C. 8253(a)(1)), 

 as amended by this subsection, supersede all previous goals and 

 baselines under such paragraph, and related reporting 

 requirements.

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 (b) Review and Revision of Energy Performance Requirement.--Section 

543(a) of the National Energy Conservation Policy Act (42 U.S.C. 

8253(a)) is further amended by adding at the end the following:

 ``(3) <<NOTE: Deadline.>> Not later than December 31, 2014, the 

Secretary shall review the results of the implementation of the energy 

performance requirement established under paragraph (1) and submit to 

Congress recommendations concerning energy performance requirements for 

fiscal years 2016 through 2025.''.

 (c) Exclusions.--Section 543(c)(1) of the National Energy 

Conservation Policy Act (42 U.S.C. 8253(c)(1)) is amended by striking 

``An agency may exclude'' and all that follows through the end and 

inserting ``(A) An agency may exclude, from the energy performance 

requirement for a fiscal year established under subsection (a) and the 

energy management requirement established under subsection (b), any 

Federal building or collection of Federal buildings, if the head of the 

agency finds that--

 ``(i) compliance with those requirements would be 

 impracticable;

 ``(ii) the agency has completed and submitted all federally 

 required energy management reports;

 ``(iii) the agency has achieved compliance with the energy 

 efficiency requirements of this Act, the Energy Policy Act of 

 1992, Executive orders, and other Federal law; and

 ``(iv) the agency has implemented all practicable, life 

 cycle cost-effective projects with respect to the Federal 

 building or collection of Federal buildings to be excluded.

 ``(B) A finding of impracticability under subparagraph (A)(i) shall 

be based on--

 ``(i) the energy intensiveness of activities carried out in 

 the Federal building or collection of Federal buildings; or

 ``(ii) the fact that the Federal building or collection of 

 Federal buildings is used in the performance of a national 

 security function.''.

 (d) Review by Secretary.--Section 543(c)(2) of the National Energy 

Conservation Policy Act (42 U.S.C. 8253(c)(2)) is amended--

 (1) by striking ``impracticability standards'' and inserting 

 ``standards for exclusion'';

 (2) by striking ``a finding of impracticability'' and 

 inserting ``the exclusion''; and

 (3) by striking ``energy consumption requirements'' and 

 inserting ``requirements of subsections (a) and (b)(1)''.

 (e) Criteria.--Section 543(c) of the National Energy Conservation 

Policy Act (42 U.S.C. 8253(c)) is further amended by adding at the end 

the following:

 ``(3) <<NOTE: Deadline. Guidelines.>> Not later than 180 days after 

the date of enactment of this paragraph, the Secretary shall issue 

guidelines that establish criteria for exclusions under paragraph 

(1).''.

 (f) Retention of Energy and Water Savings.--Section 546 of the 

National Energy Conservation Policy Act (42 U.S.C. 8256) is amended by 

adding at the end the following new subsection:

 ``(e) Retention of Energy and Water Savings.--An agency may retain 

any funds appropriated to that agency for energy

[[Page 119 STAT. 608]]

expenditures, water expenditures, or wastewater treatment expenditures, 

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at buildings subject to the requirements of section 543(a) and (b), that 

are not made because of energy savings or water savings. Except as 

otherwise provided by law, such funds may be used only for energy 

efficiency, water conservation, or unconventional and renewable energy 

resources projects. Such projects shall be subject to the requirements 

of section 3307 of title 40, United States Code.''.

 (g) Reports.--Section 548(b) of the National Energy Conservation 

Policy Act (42 U.S.C. 8258(b)) is amended--

 (1) in the subsection heading, by inserting ``the President 

 and'' before ``Congress''; and

 (2) by inserting ``President and'' before ``Congress''.

 (h) Conforming Amendment.--Section 550(d) of the National Energy 

Conservation Policy Act (42 U.S.C. 8258b(d)) is amended in the second 

sentence by striking ``the 20 percent reduction goal established under 

section 543(a) of the National Energy Conservation Policy Act (42 U.S.C. 

8253(a)).'' and inserting ``each of the energy reduction goals 

established under section 543(a).''.

SEC. 103. ENERGY USE MEASUREMENT AND ACCOUNTABILITY.

 Section 543 of the National Energy Conservation Policy Act (42 

U.S.C. 8253) is further amended by adding at the end the following:

 ``(e) Metering of Energy Use.--

 ``(1) Deadline.--By October 1, 2012, in accordance with 

 guidelines established by the Secretary under paragraph (2), all 

 Federal buildings shall, for the purposes of efficient use of 

 energy and reduction in the cost of electricity used in such 

 buildings, be metered. Each agency shall use, to the maximum 

 extent practicable, advanced meters or advanced metering devices 

 that provide data at least daily and that measure at least 

 hourly consumption of electricity in the Federal buildings of 

 the agency. Such data shall be incorporated into existing 

 Federal energy tracking systems and made available to Federal 

 facility managers.

 ``(2) Guidelines.--

 ``(A) In general.--Not <<NOTE: Deadline.>> later 

 than 180 days after the date of enactment of this 

 subsection, the Secretary, in consultation with the 

 Department of Defense, the General Services 

 Administration, representatives from the metering 

 industry, utility industry, energy services industry, 

 energy efficiency industry, energy efficiency advocacy 

 organizations, national laboratories, universities, and 

 Federal facility managers, shall establish guidelines 

 for agencies to carry out paragraph (1).

 ``(B) Requirements for guidelines.--The guidelines 

 shall--

 ``(i) take into consideration--

 ``(I) the cost of metering and the 

 reduced cost of operation and 

 maintenance expected to result from 

 metering;

 ``(II) the extent to which metering 

 is expected to result in increased 

 potential for energy management, 

 increased potential for energy savings 

 and energy efficiency improvement, and 

 cost and

[[Page 119 STAT. 609]]

 energy savings due to utility contract 

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 aggregation; and

 ``(III) the measurement and 

 verification protocols of the Department 

 of Energy;

 ``(ii) include recommendations concerning the 

 amount of funds and the number of trained 

 personnel necessary to gather and use the metering 

 information to track and reduce energy use;

 ``(iii) establish priorities for types and 

 locations of buildings to be metered based on 

 cost-effectiveness and a schedule of one or more 

 dates, not later than 1 year after the date of 

 issuance of the guidelines, on which the 

 requirements specified in paragraph (1) shall take 

 effect; and

 ``(iv) establish exclusions from the 

 requirements specified in paragraph (1) based on 

 the de minimis quantity of energy use of a Federal 

 building, industrial process, or structure.

 ``(3) Plan.--Not <<NOTE: Deadline.>> later than 6 months 

 after the date guidelines are established under paragraph (2), 

 in a report submitted by the agency under section 548(a), each 

 agency shall submit to the Secretary a plan describing how the 

 agency will implement the requirements of paragraph (1), 

 including (A) how the agency will designate personnel primarily 

 responsible for achieving the requirements and (B) demonstration 

 by the agency, complete with documentation, of any finding that 

 advanced meters or advanced metering devices, as defined in 

 paragraph (1), are not practicable.''.

SEC. 104. PROCUREMENT OF ENERGY EFFICIENT PRODUCTS.

 (a) Requirements.--Part 3 of title V of the National Energy 

Conservation Policy Act (42 U.S.C. 8251 et seq.), as amended by section 

101, is amended by adding at the end the following:

``SEC. 553. <<NOTE: 42 USC 8259b.>> FEDERAL PROCUREMENT OF ENERGY 

 EFFICIENT PRODUCTS.

 ``(a) Definitions.--In this section:

 ``(1) Agency.--The term `agency' has the meaning given that 

 term in section 7902(a) of title 5, United States Code.

 ``(2) Energy star product.--The term `Energy Star product' 

 means a product that is rated for energy efficiency under an 

 Energy Star program.

 ``(3) Energy star program.--The term `Energy Star program' 

 means the program established by section 324A of the Energy 

 Policy and Conservation Act.

 ``(4) FEMP designated product.--The term `FEMP designated 

 product' means a product that is designated under the Federal 

 Energy Management Program of the Department of Energy as being 

 among the highest 25 percent of equivalent products for energy 

 efficiency.

 ``(5) Product.--The term `product' does not include any 

 energy consuming product or system designed or procured for 

 combat or combat-related missions.

 ``(b) Procurement of Energy Efficient Products.--

 ``(1) Requirement.--To meet the requirements of an agency 

 for an energy consuming product, the head of the agency shall, 

 except as provided in paragraph (2), procure--

 ``(A) an Energy Star product; or

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[[Page 119 STAT. 610]]

 ``(B) a FEMP designated product.

 ``(2) Exceptions.--The head of an agency is not required to 

 procure an Energy Star product or FEMP designated product under 

 paragraph (1) if the head of the agency finds in writing that--

 ``(A) an Energy Star product or FEMP designated 

 product is not cost-effective over the life of the 

 product taking energy cost savings into account; or

 ``(B) no Energy Star product or FEMP designated 

 product is reasonably available that meets the

 functional requirements of the agency.

 ``(3) Procurement planning.--The head of an agency shall 

 incorporate into the specifications for all procurements 

 involving energy consuming products and systems, including guide 

 specifications, project specifications, and construction, 

 renovation, and services contracts that include provision of 

 energy consuming products and systems, and into the factors for 

 the evaluation of offers received for the procurement, criteria 

 for energy efficiency that are consistent with the criteria used 

 for rating Energy Star products and for rating FEMP designated 

 products.

 ``(c) Listing of Energy Efficient Products in Federal Catalogs.--

Energy Star products and FEMP designated products shall be clearly 

identified and prominently displayed in any inventory or listing of 

products by the General Services Administration or the Defense Logistics 

Agency. The General Services Administration or the Defense Logistics 

Agency shall supply only Energy Star products or FEMP designated 

products for all product categories covered by the Energy Star program 

or the Federal Energy Management Program, except in cases where the 

agency ordering a product specifies in writing that no Energy Star 

product or FEMP designated product is available to meet the buyer's 

functional requirements, or that no Energy Star product or FEMP 

designated product is cost-effective for the intended application over 

the life of the product, taking energy cost savings into account.

 ``(d) Specific Products.--(1) In <<NOTE: Standards.>> the case of 

electric motors of 1 to 500 horsepower, agencies shall select only 

premium efficient motors that meet a standard designated by 

the <<NOTE: Deadline.>> Secretary. The Secretary shall designate such a 

standard not later than 120 days after the date of the enactment of this 

section, after considering the recommendations of associated electric 

motor manufacturers and energy efficiency groups.

 ``(2) All Federal agencies are encouraged to take actions to 

maximize the efficiency of air conditioning and refrigeration equipment, 

including appropriate cleaning and maintenance, including the use of any 

system treatment or additive that will reduce the electricity consumed 

by air conditioning and refrigeration equipment. Any such treatment or 

additive must be--

 ``(A) determined by the Secretary to be effective in 

 increasing the efficiency of air conditioning and refrigeration 

 equipment without having an adverse impact on air conditioning 

 performance (including cooling capacity) or equipment useful 

 life;

 ``(B) determined by the Administrator of the Environmental 

 Protection Agency to be environmentally safe; and

 ``(C) shown to increase seasonal energy efficiency ratio 

 (SEER) or energy efficiency ratio (EER) when tested by the

[[Page 119 STAT. 611]]

 National Institute of Standards and Technology according to 

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 Department of Energy test procedures without causing any adverse 

 impact on the system, system components, the refrigerant or 

 lubricant, or other materials in the system.

 Results of <<NOTE: Federal Register, publication.>> testing 

 described in subparagraph (C) shall be published in the Federal 

 Register for public review and comment. For purposes of this 

 section, a hardware device or primary refrigerant shall not be 

 considered an additive.

 ``(e) Regulations.--Not later than 180 days after the date of the 

enactment of this section, the Secretary shall issue guidelines to carry 

out this section.''.

 (b) Conforming Amendment.--The table of contents of the National 

Energy Conservation Policy Act is further amended by inserting after the 

item relating to section 552 the following new item:

``Sec. 553. Federal procurement of energy efficient products.''.

SEC. 105. ENERGY SAVINGS PERFORMANCE CONTRACTS.

 (a) Extension.--Section 801(c) of the National Energy Conservation 

Policy Act (42 U.S.C. 8287(c)) is amended by striking ``2006'' and 

inserting ``2016''.

 (b) Extension of Authority.--Any <<NOTE: 42 USC 8257 note.>> energy 

savings performance contract entered into under section 801 of the 

National Energy Conservation Policy Act (42 U.S.C. 8287) after October 

1, 2003, and before the date of enactment of this Act, shall be 

considered to have been entered into under that section.

SEC. 106. <<NOTE: 42 USC 15811.>> VOLUNTARY COMMITMENTS TO REDUCE 

 INDUSTRIAL ENERGY INTENSITY.

 (a) Definition of Energy Intensity.--In this section, the term 

``energy intensity'' means the primary energy consumed for each unit of 

physical output in an industrial process.

 (b) Voluntary Agreements.--The Secretary may enter into voluntary 

agreements with one or more persons in industrial sectors that consume 

significant quantities of primary energy for each unit of physical 

output to reduce the energy intensity of the production activities of 

the persons.

 (c) Goal.--Voluntary agreements under this section shall have as a 

goal the reduction of energy intensity by not less than 2.5 percent each 

year during the period of calendar years 2007 through 2016.

 (d) Recognition.--The Secretary, in cooperation with other 

appropriate Federal agencies, shall develop mechanisms to recognize and 

publicize the achievements of participants in voluntary agreements under 

this section.

 (e) Technical Assistance.--A person that enters into an agreement 

under this section and continues to make a good faith effort to achieve 

the energy efficiency goals specified in the agreement shall be eligible 

to receive from the Secretary a grant or technical assistance, as 

appropriate, to assist in the achievement of those goals.

 (f) Report.--Not later than each of June 30, 2012, and June 30, 

2017, the Secretary shall submit to Congress a report that--

 (1) evaluates the success of the voluntary agreements under 

 this section; and

 (2) provides independent verification of a sample of the 

 energy savings estimates provided by participating firms.

[[Page 119 STAT. 612]]

SEC. 107. <<NOTE: 42 USC 15812.>> ADVANCED BUILDING EFFICIENCY TESTBED.

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 (a) Establishment.--The Secretary, in consultation with the 

Administrator of General Services, shall establish an Advanced Building 

Efficiency Testbed program for the development, testing, and 

demonstration of advanced engineering systems, components, and materials 

to enable innovations in building technologies. The program shall 

evaluate efficiency concepts for government and industry buildings, and 

demonstrate the ability of next generation buildings to support 

individual and organizational productivity and health (including by 

improving indoor air quality) as well as flexibility and technological 

change to improve environmental sustainability. Such program shall 

complement and not duplicate existing national programs.

 (b) Participants.--The program established under subsection (a) 

shall be led by a university with the ability to combine the expertise 

from numerous academic fields including, at a minimum, intelligent 

workplaces and advanced building systems and engineering, electrical and 

computer engineering, computer science, architecture, urban design, and 

environmental and mechanical engineering. Such university shall partner 

with other universities and entities who have established programs and 

the capability of advancing innovative building efficiency technologies.

 (c) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out this section $6,000,000 for 

each of the fiscal years 2006 through 2008, to remain available until 

expended. For any fiscal year in which funds are expended under this 

section, the Secretary shall provide one-third of the total amount to 

the lead university described in subsection (b), and provide the 

remaining two-thirds to the other participants referred to in subsection 

(b) on an equal basis.

SEC. 108. INCREASED USE OF RECOVERED MINERAL COMPONENT IN FEDERALLY 

 FUNDED PROJECTS INVOLVING PROCUREMENT OF CEMENT OR CONCRETE.

 (a) Amendment.--Subtitle F of the Solid Waste Disposal Act (42 

U.S.C. 6961 et seq.) is amended by adding at the end the following:

``increased <<NOTE: 42 usc 6966.>> use of recovered mineral component in 

federally funded projects involving procurement of cement or concrete

 ``Sec. 6005. (a) Definitions.--In this section:

 ``(1) Agency head.--The term `agency head' means--

 ``(A) the Secretary of Transportation; and

 ``(B) the head of any other Federal agency that, on 

 a regular basis, procures, or provides Federal funds to 

 pay or assist in paying the cost of procuring, material 

 for cement or concrete projects.

 ``(2) Cement or concrete project.--The term `cement or 

 concrete project' means a project for the construction or 

 maintenance of a highway or other transportation facility or a 

 Federal, State, or local government building or other public 

 facility that--

 ``(A) involves the procurement of cement or 

 concrete; and

 ``(B) is carried out, in whole or in part, using 

 Federal funds.

[[Page 119 STAT. 613]]

 ``(3) Recovered mineral component.--The term `recovered 

 mineral component' means--

 ``(A) ground granulated blast furnace slag, 

 excluding lead slag;

 ``(B) coal combustion fly ash; and

 ``(C) any other waste material or byproduct 

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 recovered or diverted from solid waste that the 

 Administrator, in consultation with an agency head, 

 determines should be treated as recovered mineral 

 component under this section for use in cement or 

 concrete projects paid for, in whole or in part, by the 

 agency head.

 ``(b) Implementation of Requirements.--

 ``(1) In general.--Not <<NOTE: Deadline.>> later than 1 year 

 after the date of enactment of this section, the Administrator 

 and each agency head shall take such actions as are necessary to 

 implement fully all procurement requirements and incentives in 

 effect as of the date of enactment of this section (including 

 guidelines under section 6002) that provide for the use of 

 cement and concrete incorporating recovered mineral component in 

 cement or concrete projects.

 ``(2) Priority.--In carrying out paragraph (1), an agency 

 head shall give priority to achieving greater use of recovered 

 mineral component in cement or concrete projects for which 

 recovered mineral components historically have not been used or 

 have been used only minimally.

 ``(3) Federal procurement requirements.--The Administrator 

 and each agency head shall carry out this subsection in 

 accordance with section 6002.

 ``(c) Full Implementation Study.--

 ``(1) In general.--The Administrator, in cooperation with 

 the Secretary of Transportation and the Secretary of Energy, 

 shall conduct a study to determine the extent to which 

 procurement requirements, when fully implemented in accordance 

 with subsection (b), may realize energy savings and 

 environmental benefits attainable with substitution of recovered 

 mineral component in cement used in cement or concrete projects.

 ``(2) Matters to be addressed.--The study shall--

 ``(A) quantify--

 ``(i) the extent to which recovered mineral 

 components are being substituted for Portland 

 cement, particularly as a result of procurement 

 requirements; and

 ``(ii) the energy savings and environmental 

 benefits associated with the substitution;

 ``(B) identify all barriers in procurement 

 requirements to greater realization of energy savings 

 and environmental benefits, including barriers resulting 

 from exceptions from the law; and

 ``(C)(i) identify potential mechanisms to achieve 

 greater substitution of recovered mineral component in 

 types of cement or concrete projects for which recovered 

 mineral components historically have not been used or 

 have been used only minimally;

 ``(ii) evaluate the feasibility of establishing 

 guidelines or standards for optimized substitution rates 

 of recovered mineral component in those cement or 

 concrete projects; and

[[Page 119 STAT. 614]]

 ``(iii) identify any potential environmental or 

 economic effects that may result from greater 

 substitution of recovered mineral component in those 

 cement or concrete projects.

 ``(3) Report.--Not later than 30 months after the date of 

 enactment of this section, the Administrator shall submit to 

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 Congress a report on the study.

 ``(d) Additional <<NOTE: Deadline.>> Procurement Requirements.--

Unless the study conducted under subsection (c) identifies any effects 

or other problems described in subsection (c)(2)(C)(iii) that warrant 

further review or delay, the Administrator and each agency head shall, 

not later than 1 year after the date on which the report under 

subsection (c)(3) is submitted, take additional actions under this Act 

to establish procurement requirements and incentives that provide for 

the use of cement and concrete with increased substitution of recovered 

mineral component in the construction and maintenance of cement or 

concrete projects--

 ``(1) to realize more fully the energy savings and 

 environmental benefits associated with increased substitution; 

 and

 ``(2) to eliminate barriers identified under subsection 

 (c)(2)(B).

 ``(e) Effect of Section.--Nothing in this section affects the 

requirements of section 6002 (including the guidelines and 

specifications for implementing those requirements).''.

 (b) Conforming Amendment.--The table of contents of the Solid Waste 

Disposal Act is amended by adding after the item relating to section 

6004 the following:

``Sec. 6005. Increased use of recovered mineral component in federally 

 funded projects involving procurement of cement or 

 concrete.''.

SEC. 109. FEDERAL BUILDING PERFORMANCE STANDARDS.

 Section 305(a) of the Energy Conservation and Production Act (42 

U.S.C. 6834(a)) is amended--

 (1) in paragraph (2)(A), by striking ``CABO Model Energy 

 Code, 1992 (in the case of residential buildings) or ASHRAE 

 Standard 90.1-1989'' and inserting ``the 2004 International 

 Energy Conservation Code (in the case of residential buildings) 

 or ASHRAE Standard 90.1-2004''; and

 (2) by adding at the end the following:

 ``(3)(A) <<NOTE: Deadline. Regulations.>> Not later than 1 year 

after the date of enactment of this paragraph, the Secretary shall 

establish, by rule, revised Federal building energy efficiency 

performance standards that require that--

 ``(i) if life-cycle cost-effective for new Federal 

 buildings--

 ``(I) the buildings be designed to achieve energy 

 consumption levels that are at least 30 percent below 

 the levels established in the version of the ASHRAE 

 Standard or the International Energy Conservation Code, 

 as appropriate, that is in effect as of the date of 

 enactment of this paragraph; and

 ``(II) sustainable design principles are applied to 

 the siting, design, and construction of all new and 

 replacement buildings; and

 ``(ii) if water is used to achieve energy efficiency, water 

 conservation technologies shall be applied to the extent that 

 the technologies are life-cycle cost-effective.

[[Page 119 STAT. 615]]

 ``(B) <<NOTE: Deadline.>> Not later than 1 year after the date of 

approval of each subsequent revision of the ASHRAE Standard or the 

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International Energy Conservation Code, as appropriate, the Secretary 

shall determine, based on the cost-effectiveness of the requirements 

under the amendment, whether the revised standards established under 

this paragraph should be updated to reflect the amendment.

 ``(C) In the budget request of the Federal agency for each fiscal 

year and each report submitted by the Federal agency under section 

548(a) of the National Energy Conservation Policy Act (42 U.S.C. 

8258(a)), the head of each Federal agency shall include--

 ``(i) a list of all new Federal buildings owned, operated, 

 or controlled by the Federal agency; and

 ``(ii) a statement specifying whether the Federal buildings 

 meet or exceed the revised standards established under this 

 paragraph.''.

SEC. 110. DAYLIGHT SAVINGS.

 (a) Amendment.--Section 3(a) of the Uniform Time Act of 1966 (15 

U.S.C. 260a(a)) is amended--

 (1) by striking ``first Sunday of April'' and inserting 

 ``second Sunday of March''; and

 (2) by striking ``last Sunday of October'' and inserting 

 ``first Sunday of November''.

 (b) Effective Date.--Subsection (a) <<NOTE: 15 USC 260a 

note.>> shall take effect 1 year after the date of enactment of this Act 

or March 1, 2007, whichever is later.

 (c) Report to Congress.--Not <<NOTE: 15 USC 260a note.>> later than 

9 months after the effective date stated in subsection (b), the 

Secretary shall report to Congress on the impact of this section on 

energy consumption in the United States.

 (d) Right to Revert.--Congress retains the right to revert the 

Daylight Saving Time back to the 2005 time schedules once the Department 

study is complete.

SEC. 111. <<NOTE: 42 USC 15813.>> ENHANCING ENERGY EFFICIENCY IN 

 MANAGEMENT OF FEDERAL LANDS.

 (a) Sense of the Congress.--It is the sense of the Congress that 

Federal agencies should enhance the use of energy efficient technologies 

in the management of natural resources.

 (b) Energy Efficient Buildings.--To the extent practicable, the 

Secretary of the Interior, the Secretary of Commerce, and the Secretary 

of Agriculture shall seek to incorporate energy efficient technologies 

in public and administrative buildings associated with management of the 

National Park System, National Wildlife Refuge System, National Forest 

System, National Marine Sanctuaries System, and other public lands and 

resources managed by the Secretaries.

 (c) Energy Efficient Vehicles.--To the extent practicable, the 

Secretary of the Interior, the Secretary of Commerce, and the Secretary 

of Agriculture shall seek to use energy efficient motor vehicles, 

including vehicles equipped with biodiesel or hybrid engine 

technologies, in the management of the National Park System, National 

Wildlife Refuge System, National Forest System, National Marine 

Sanctuaries System, and other public lands and resources managed by the 

Secretaries.

[[Page 119 STAT. 616]]

 Subtitle B--Energy Assistance and State Programs

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SEC. 121. LOW-INCOME HOME ENERGY ASSISTANCE PROGRAM.

 (a) Authorization of Appropriations.--Section 2602(b) of the LowIncome Home Energy Assistance Act of 1981 (42 U.S.C. 8621(b)) is amended 

by striking ``and $2,000,000,000 for each of fiscal years 2002 through 

2004'' and inserting ``and $5,100,000,000 for each of fiscal years 2005 

through 2007''.

 (b) Renewable Fuels.--The Low-Income Home Energy Assistance Act of 

1981 (42 U.S.C. 8621 et seq.) is amended by adding at the end the 

following new section:

 ``renewable fuels

 ``Sec. 2612. <<NOTE: 42 USC 8630.>> In providing assistance pursuant 

to this title, a State, or any other person with which the State makes 

arrangements to carry out the purposes of this title, may purchase 

renewable fuels, including biomass.''.

 (c) Report to Congress.--The <<NOTE: 42 USC 8630 note.>> Secretary 

shall report to Congress on the use of renewable fuels in providing 

assistance under the Low-Income Home Energy Assistance Act of 1981 (42 

U.S.C. 8621 et seq.).

SEC. 122. WEATHERIZATION ASSISTANCE.

 (a) Authorization of Appropriations.--Section 422 of the Energy 

Conservation and Production Act (42 U.S.C. 6872) is amended by striking 

``for fiscal years 1999 through 2003 such sums as may be necessary'' and 

inserting ``$500,000,000 for fiscal year 2006, $600,000,000 for fiscal 

year 2007, and $700,000,000 for fiscal year 2008''.

 (b) Eligibility.--Section 412(7) of the Energy Conservation and 

Production Act (42 U.S.C. 6862(7)) is amended by striking ``125 

percent'' both places it appears and inserting ``150 percent''.

SEC. 123. STATE ENERGY PROGRAMS.

 (a) State Energy Conservation Plans.--Section 362 of the Energy 

Policy and Conservation Act (42 U.S.C. 6322) is amended by inserting at 

the end the following new subsection:

 ``(g) The Secretary shall, at least once every 3 years, invite the 

Governor of each State to review and, if necessary, revise the energy 

conservation plan of such State submitted under subsection (b) or (e). 

Such reviews should consider the energy conservation plans of other 

States within the region, and identify opportunities and actions carried 

out in pursuit of common energy conservation goals.''.

 (b) State Energy Efficiency Goals.--Section 364 of the Energy Policy 

and Conservation Act (42 U.S.C. 6324) is amended to read as follows:

 ``state energy efficiency goals

 ``Sec. 364. Each State energy conservation plan with respect to 

which assistance is made available under this part on or after the date 

of enactment of the Energy Policy Act of 2005 shall contain a goal, 

consisting of an improvement of 25 percent or more in the efficiency of 

use of energy in the State concerned

[[Page 119 STAT. 617]]

in calendar year 2012 as compared to calendar year 1990, and may contain 

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interim goals.''.

 (c) Authorization of Appropriations.--Section 365(f) of the Energy 

Policy and Conservation Act (42 U.S.C. 6325(f)) is amended by striking 

``for fiscal years 1999 through 2003 such sums as may be necessary'' and 

inserting ``$100,000,000 for each of the fiscal years 2006 and 2007 and 

$125,000,000 for fiscal year 2008''.

SEC. 124. <<NOTE: 42 USC 15821.>> ENERGY EFFICIENT APPLIANCE REBATE 

 PROGRAMS.

 (a) Definitions.--In this section:

 (1) Eligible state.--The term ``eligible State'' means a 

 State that meets the requirements of subsection (b).

 (2) Energy star program.--The term ``Energy Star program'' 

 means the program established by section 324A of the Energy 

 Policy and Conservation Act.

 (3) Residential energy star product.--The term ``residential 

 Energy Star product'' means a product for a residence that is 

 rated for energy efficiency under the Energy Star program.

 (4) State energy office.--The term ``State energy office'' 

 means the State agency responsible for developing State energy 

 conservation plans under section 362 of the Energy Policy and 

 Conservation Act (42 U.S.C. 6322).

 (5) State program.--The term ``State program'' means a State 

 energy efficient appliance rebate program described in 

 subsection (b)(1).

 (b) Eligible States.--A State shall be eligible to receive an 

allocation under subsection (c) if the State--

 (1) establishes (or has established) a State energy 

 efficient appliance rebate program to provide rebates to 

 residential consumers for the purchase of residential Energy 

 Star products to replace used appliances of the same type;

 (2) submits an application for the allocation at such time, 

 in such form, and containing such information as the Secretary 

 may require; and

 (3) provides assurances satisfactory to the Secretary that 

 the State will use the allocation to supplement, but not 

 supplant, funds made available to carry out the State program.

 (c) Amount of Allocations.--

 (1) In general.--Subject to paragraph (2), for each fiscal 

 year, the Secretary shall allocate to the State energy office of 

 each eligible State to carry out subsection (d) an amount equal 

 to the product obtained by multiplying the amount made available 

 under subsection (f) for the fiscal year by the ratio that the 

 population of the State in the most recent calendar year for 

 which data are available bears to the total population of all 

 eligible States in that calendar year.

 (2) Minimum allocations.--For each fiscal year, the amounts 

 allocated under this subsection shall be adjusted 

 proportionately so that no eligible State is allocated a sum 

 that is less than an amount determined by the Secretary.

 (d) Use of Allocated Funds.--The allocation to a State energy office 

under subsection (c) may be used to pay up to 50 percent of the cost of 

establishing and carrying out a State program.

 (e) Issuance of Rebates.--Rebates may be provided to residential 

consumers that meet the requirements of the State program.

[[Page 119 STAT. 618]]

The amount of a rebate shall be determined by the State energy office, 

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taking into consideration--

 (1) the amount of the allocation to the State energy office 

 under subsection (c);

 (2) the amount of any Federal or State tax incentive 

 available for the purchase of the residential Energy Star 

 product; and

 (3) the difference between the cost of the residential 

 Energy Star product and the cost of an appliance that is not a 

 residential Energy Star product, but is of the same type as, and 

 is the nearest capacity, performance, and other relevant 

 characteristics (as determined by the State energy office) to, 

 the residential Energy Star product.

 (f) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out this section $50,000,000 for 

each of the fiscal years 2006 through 2010.

SEC. 125. <<NOTE: 42 USC 15822.>> ENERGY EFFICIENT PUBLIC BUILDINGS.

 (a) Grants.--The Secretary may make grants to the State agency 

responsible for developing State energy conservation plans under section 

362 of the Energy Policy and Conservation Act (42 U.S.C. 6322), or, if 

no such agency exists, a State agency designated by the Governor of the 

State, to assist units of local government in the State in improving the 

energy efficiency of public buildings and facilities--

 (1) through construction of new energy efficient public 

 buildings that use at least 30 percent less energy than a 

 comparable public building constructed in compliance with 

 standards prescribed in the most recent version of the 

 International Energy Conservation Code, or a similar State code 

 intended to achieve substantially equivalent efficiency levels; 

 or

 (2) through renovation of existing public buildings to 

 achieve reductions in energy use of at least 30 percent as 

 compared to the baseline energy use in such buildings prior to 

 renovation, assuming a 3-year, weather-normalized average for 

 calculating such baseline.

 (b) Administration.--State energy offices receiving grants under 

this section shall--

 (1) <<NOTE: Records.>> maintain such records and evidence of 

 compliance as the Secretary may require; and

 (2) develop and distribute information and materials and 

 conduct programs to provide technical services and assistance to 

 encourage planning, financing, and design of energy efficient 

 public buildings by units of local government.

 (c) Authorization of Appropriations.--For the purposes of this 

section, there are authorized to be appropriated to the Secretary 

$30,000,000 for each of fiscal years 2006 through 2010. Not more than 10 

percent of appropriated funds shall be used for administration.

SEC. 126. <<NOTE: 42 USC 15823.>> LOW INCOME COMMUNITY ENERGY EFFICIENCY 

 PILOT PROGRAM.

 (a) Grants.--The Secretary is authorized to make grants to units of 

local government, private, non-profit community development 

organizations, and Indian tribe economic development entities to improve 

energy efficiency; identify and develop alternative, renewable, and 

distributed energy supplies; and increase energy conservation in low 

income rural and urban communities.

[[Page 119 STAT. 619]]

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 (b) Purpose of Grants.--The Secretary may make grants on a 

competitive basis for--

 (1) investments that develop alternative, renewable, and 

 distributed energy supplies;

 (2) energy efficiency projects and energy conservation 

 programs;

 (3) studies and other activities that improve energy 

 efficiency in low income rural and urban communities;

 (4) planning and development assistance for increasing the 

 energy efficiency of buildings and facilities; and

 (5) technical and financial assistance to local government 

 and private entities on developing new renewable and distributed 

 sources of power or combined heat and power generation.

 (c) Definition.--For purposes of this section, the term ``Indian 

tribe'' means any Indian tribe, band, nation, or other organized group 

or community, including any Alaskan Native village or regional or 

village corporation as defined in or established pursuant to the Alaska 

Native Claims Settlement Act (43 U.S.C. 1601 et seq.), that is 

recognized as eligible for the special programs and services provided by 

the United States to Indians because of their status as Indians.

 (d) Authorization of Appropriations.--For the purposes of this 

section there are authorized to be appropriated to the Secretary 

$20,000,000 for each of fiscal years 2006 through 2008.

SEC. 127. <<NOTE: 42 USC 15824.>> STATE TECHNOLOGIES ADVANCEMENT 

 COLLABORATIVE.

 (a) In General.--The Secretary, in cooperation with the States, 

shall establish a cooperative program for research, development, 

demonstration, and deployment of technologies in which there is a common 

Federal and State energy efficiency, renewable energy, and fossil energy 

interest, to be known as the ``State Technologies Advancement 

Collaborative'' (referred to in this section as the ``Collaborative'').

 (b) Duties.--The Collaborative shall--

 (1) leverage Federal and State funding through cost-shared 

 activity;

 (2) reduce redundancies in Federal and State funding; and

 (3) create multistate projects to be awarded through a 

 competitive process.

 (c) Administration.--The Collaborative shall be administered through 

an agreement between the Department and appropriate State-based 

organizations.

 (d) Funding Sources.--Funding for the Collaborative may be provided 

from--

 (1) amounts specifically appropriated for the Collaborative; 

 or

 (2) amounts that may be allocated from other appropriations 

 without changing the purpose for which the amounts are 

 appropriated.

 (e) Authorization of Appropriations.--There are authorized to carry 

out this section such sums as are necessary for each of fiscal years 

2006 through 2010.

SEC. 128. STATE BUILDING ENERGY EFFICIENCY CODES INCENTIVES.

 Section 304(e) of the Energy Conservation and Production Act (42 

U.S.C. 6833(e)) is amended--

[[Page 119 STAT. 620]]

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 (1) in paragraph (1), by inserting before the period at the 

 end of the first sentence the following: ``, including 

 increasing and verifying compliance with such codes''; and

 (2) by striking paragraph (2) and inserting the following:

 ``(2) Additional funding shall be provided under this subsection for 

implementation of a plan to achieve and document at least a 90 percent 

rate of compliance with residential and commercial building energy 

efficiency codes, based on energy performance--

 ``(A) to a State that has adopted and is implementing, on a 

 statewide basis--

 ``(i) a residential building energy efficiency code 

 that meets or exceeds the requirements of the 2004 

 International Energy Conservation Code, or any 

 succeeding version of that code that has received an 

 affirmative determination from the Secretary under 

 subsection (a)(5)(A); and

 ``(ii) a commercial building energy efficiency code 

 that meets or exceeds the requirements of the ASHRAE 

 Standard 90.1-2004, or any succeeding version of that 

 standard that has received an affirmative determination 

 from the Secretary under subsection (b)(2)(A); or

 ``(B) in a State in which there is no statewide energy code 

 either for residential buildings or for commercial buildings, to 

 a local government that has adopted and is implementing 

 residential and commercial building energy efficiency codes, as 

 described in subparagraph (A).

 ``(3) Of the amounts made available under this subsection, the 

Secretary may use $500,000 for each fiscal year to train State and local 

officials to implement codes described in paragraph (2).

 ``(4)(A) <<NOTE: Appropriation authorization.>> There are authorized 

to be appropriated to carry out this subsection--

 ``(i) $25,000,000 for each of fiscal years 2006 through 

 2010; and

 ``(ii) such sums as are necessary for fiscal year 2011 and 

 each fiscal year thereafter.

 ``(B) Funding provided to States under paragraph (2) for each fiscal 

year shall not exceed one-half of the excess of funding under this 

subsection over $5,000,000 for the fiscal year.''.

 Subtitle C--Energy Efficient Products

SEC. 131. ENERGY STAR PROGRAM.

 (a) In General.--The Energy Policy and Conservation Act is amended 

by inserting after section 324 (42 U.S.C. 6294) the following:

 ``energy star program

 ``Sec. 324A. (a) In General.--There is <<NOTE: 42 USC 

6294a.>> established within the Department of Energy and the 

Environmental Protection Agency a voluntary program to identify and 

promote energy-efficient products and buildings in order to reduce 

energy consumption, improve energy security, and reduce pollution 

through voluntary labeling of, or other forms of communication about, 

products and buildings that meet the highest energy conservation 

standards.

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 ``(b) Division of Responsibilities.--Responsibilities under the 

program shall be divided between the Department of Energy and

[[Page 119 STAT. 621]]

the Environmental Protection Agency in accordance with the terms of 

applicable agreements between those agencies.

 ``(c) Duties.--The Administrator and the Secretary shall--

 ``(1) promote Energy Star compliant technologies as the 

 preferred technologies in the marketplace for--

 ``(A) achieving energy efficiency; and

 ``(B) reducing pollution;

 ``(2) work to enhance public awareness of the Energy Star 

 label, including by providing special outreach to small 

 businesses;

 ``(3) preserve the integrity of the Energy Star label;

 ``(4) regularly update Energy Star product criteria for 

 product categories;

 ``(5) solicit comments from interested parties prior to 

 establishing or revising an Energy Star product category, 

 specification, or criterion (or prior to effective dates for any 

 such product category, specification, or criterion);

 ``(6) on adoption of a new or revised product category, 

 specification, or criterion, provide reasonable notice to 

 interested parties of any changes (including effective dates) in 

 product categories, specifications, or criteria, along with--

 ``(A) an explanation of the changes; and

 ``(B) as appropriate, responses to comments 

 submitted by interested parties; and

 ``(7) provide appropriate lead time (which shall be 270 

 days, unless the Agency or Department specifies otherwise) prior 

 to the applicable effective date for a new or a significant 

 revision to a product category, specification, or criterion, 

 taking into account the timing requirements of the 

 manufacturing, product marketing, and distribution process for 

 the specific product addressed.

 ``(d) Deadlines.--The Secretary shall establish new qualifying 

levels--

 ``(1) not later than January 1, 2006, for clothes washers 

 and dishwashers, effective beginning January 1, 2007; and

 ``(2) not later than January 1, 2008, for clothes washers, 

 effective beginning January 1, 2010.''.

 (b) Table of Contents Amendment.--The table of contents of the 

Energy Policy and Conservation Act (42 U.S.C. prec. 6201) is amended by 

inserting after the item relating to section 324 the following:

``Sec. 324A. Energy Star program.''.

SEC. 132. HVAC MAINTENANCE CONSUMER EDUCATION PROGRAM.

 Section 337 of the Energy Policy and Conservation Act (42 U.S.C. 

6307) is amended by adding at the end the following:

 ``(c) HVAC Maintenance.--(1) <<NOTE: Deadline.>> To ensure that 

installed air conditioning and heating systems operate at maximum rated 

efficiency levels, the Secretary shall, not later than 180 days after 

the date of enactment of this subsection, carry out a program to educate 

homeowners and small business owners concerning the energy savings from 

properly conducted maintenance of air conditioning, heating, and 

ventilating systems.

 ``(2) The Secretary shall carry out the program under paragraph (1), 

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on a cost-shared basis, in cooperation with the Administrator of the 

Environmental Protection Agency and any other entities that the 

Secretary determines to be appropriate, including industry

[[Page 119 STAT. 622]]

trade associations, industry members, and energy efficiency 

organizations.

 ``(d) Small Business Education and Assistance.--(1) The 

Administrator of the Small Business Administration, in consultation with 

the Secretary and the Administrator of the Environmental Protection 

Agency, shall develop and coordinate a Government-wide program, building 

on the Energy Star for Small Business Program, to assist small 

businesses in--

 ``(A) becoming more energy efficient;

 ``(B) understanding the cost savings from improved energy 

 efficiency;

 ``(C) understanding and accessing Federal procurement 

 opportunities with regard to Energy Star technologies and 

 products; and

 ``(D) identifying financing options for energy efficiency 

 upgrades.

 ``(2) The Secretary, the Administrator of the Environmental 

Protection Agency, and the Administrator of the Small Business 

Administration shall--

 ``(A) make program information available to small business 

 concerns directly through the district offices and resource 

 partners of the Small Business Administration, including small 

 business development centers, women's business centers, and the 

 Service Corps of Retired Executives (SCORE), and through other 

 Federal agencies, including the Federal Emergency Management 

 Agency and the Department of Agriculture; and

 ``(B) coordinate assistance with the Secretary of Commerce 

 for manufacturing-related efforts, including the Manufacturing 

 Extension Partnership Program.

 ``(3) The Secretary, on a cost shared basis in cooperation with the 

Administrator of the Environmental Protection Agency, shall provide to 

the Small Business Administration all advertising, marketing, and other 

written materials necessary for the dissemination of information under 

paragraph (2).

 ``(4) The Secretary, the Administrator of the Environmental 

Protection Agency, and the Administrator of the Small Business 

Administration, as part of the outreach to small business concerns under 

the Energy Star Program for Small Business Program, may enter into 

cooperative agreements with qualified resources partners (including the 

National Center for Appropriate Technology) to establish, maintain, and 

promote a Small Business Energy Clearinghouse (in this subsection 

referred to as the `Clearinghouse').

 ``(5) The Secretary, the Administrator of the Environmental 

Protection Agency, and the Administrator of the Small Business 

Administration shall ensure that the Clearinghouse provides a 

centralized resource where small business concerns may access, 

telephonically and electronically, technical information and advice to 

help increase energy efficiency and reduce energy costs.

 ``(6) <<NOTE: Appropriation authorization.>> There are authorized to 

be appropriated such sums as are necessary to carry out this subsection, 

to remain available until expended.''.

SEC. 133. <<NOTE: 42 USC 15831.>> PUBLIC ENERGY EDUCATION PROGRAM.

 (a) In General.--Not <<NOTE: Deadline.>> later than 180 days after 

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the date of enactment of this Act, the Secretary shall convene an 

organizational conference for the purpose of establishing an ongoing, 

self-sustaining national public energy education program.

[[Page 119 STAT. 623]]

 (b) Participants.--The Secretary shall invite to participate in the 

conference individuals and entities representing all aspects of energy 

production and distribution, including--

 (1) industrial firms;

 (2) professional societies;

 (3) educational organizations;

 (4) trade associations; and

 (5) governmental agencies.

 (c) Purpose, Scope, and Structure.--

 (1) Purpose.--The purpose of the conference shall be to 

 establish an ongoing, self-sustaining national public energy 

 education program to examine and recognize interrelationships 

 between energy sources in all forms, including--

 (A) conservation and energy efficiency;

 (B) the role of energy use in the economy; and

 (C) the impact of energy use on the environment.

 (2) Scope and structure.--Taking into consideration the 

 purpose described in paragraph (1), the participants in the 

 conference invited under subsection (b) shall design the scope 

 and structure of the program described in subsection (a).

 (d) Technical Assistance.--The Secretary shall provide technical 

assistance and other guidance necessary to carry out the program 

described in subsection (a).

 (e) Authorization of Appropriations.--There are authorized to be 

appropriated such sums as are necessary to carry out this section.

SEC. 134. <<NOTE: 42 USC 15832.>> ENERGY EFFICIENCY PUBLIC INFORMATION 

 INITIATIVE.

 (a) In General.--The Secretary shall carry out a comprehensive 

national program, including advertising and media awareness, to inform 

consumers about--

 (1) the need to reduce energy consumption during the 4-year 

 period beginning on the date of enactment of this Act;

 (2) the benefits to consumers of reducing consumption of 

 electricity, natural gas, and petroleum, particularly during 

 peak use periods;

 (3) the importance of low energy costs to economic growth 

 and preserving manufacturing jobs in the United States; and

 (4) practical, cost-effective measures that consumers can 

 take to reduce consumption of electricity, natural gas, and 

 gasoline, including--

 (A) maintaining and repairing heating and cooling 

 ducts and equipment;

 (B) weatherizing homes and buildings;

 (C) purchasing energy efficient products; and

 (D) proper tire maintenance.

 (b) Cooperation.--The program carried out under subsection (a) 

shall--

 (1) include collaborative efforts with State and local 

 government officials and the private sector; and

 (2) incorporate, to the maximum extent practicable, 

 successful State and local public education programs.

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 (c) Report.--Not later than July 1, 2009, the Secretary shall submit 

to Congress a report describing the effectiveness of the program under 

this section.

 (d) Termination of Authority.--The program carried out under this 

section shall terminate on December 31, 2010.

[[Page 119 STAT. 624]]

 (e) Authorization of Appropriations.--There are authorized to be 

appropriated to carry out this section $90,000,000 for each of fiscal 

years 2006 through 2010.

SEC. 135. ENERGY CONSERVATION STANDARDS FOR ADDITIONAL PRODUCTS.

 (a) Definitions.--Section 321 of the Energy Policy and Conservation 

Act (42 U.S.C. 6291) is amended--

 (1) in paragraph (29)--

 (A) in subparagraph (D)--

 (i) in clause (i), by striking ``C78.1-

 1978(R1984)'' and inserting ``C78.81-2003 (Data 

 Sheet 7881-ANSI-1010-1)'';

 (ii) in clause (ii), by striking ``C78.1-

 1978(R1984)'' and inserting ``C78.81-2003 (Data 

 Sheet 7881-ANSI-3007-1)''; and

 (iii) in clause (iii), by striking ``C78.1-

 1978(R1984)'' and inserting ``C78.81-2003 (Data 

 Sheet 7881-ANSI-1019-1)''; and

 (B) by adding at the end the following:

 ``(M) The term `F34T12 lamp' (also known as a `F40T12/ES 

 lamp') means a nominal 34 watt tubular fluorescent lamp that is 

 48 inches in length and 1\1/2\ inches in diameter, and conforms 

 to ANSI standard C78.81-2003 (Data Sheet 7881-ANSI-1006-1).

 ``(N) The term `F96T12/ES lamp' means a nominal 60 watt 

 tubular fluorescent lamp that is 96 inches in length and 1\1/2\ 

 inches in diameter, and conforms to ANSI standard C78.81-2003 

 (Data Sheet 7881-ANSI-3006-1).

 ``(O) The term `F96T12HO/ES lamp' means a nominal 95 watt 

 tubular fluorescent lamp that is 96 inches in length and 1\1/2\ 

 inches in diameter, and conforms to ANSI standard C78.81-2003 

 (Data Sheet 7881-ANSI-1017-1).

 ``(P) The term `replacement ballast' means a ballast that--

 ``(i) is designed for use to replace an existing 

 ballast in a previously installed luminaire;

 ``(ii) is marked `FOR REPLACEMENT USE ONLY';

 ``(iii) is shipped by the manufacturer in packages 

 containing not more than 10 ballasts; and

 ``(iv) has output leads that when fully extended are 

 a total length that is less than the length of the lamp 

 with which the ballast is intended to be operated.'';

 (2) in paragraph (30)(S)--

 (A) by inserting ``(i)'' before ``The term''; and

 (B) by adding at the end the following:

 ``(ii) The term `medium base compact fluorescent 

 lamp' does not include--

 ``(I) any lamp that is--

 ``(aa) specifically designed to be 

 used for special purpose applications;

 and

 ``(bb) unlikely to be used in 

 general purpose applications, such as 

 the applications described in 

 subparagraph (D); or

 ``(II) any lamp not described in subparagraph 

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 (D) that is excluded by the Secretary, by rule, 

 because the lamp is--

 ``(aa) designed for special 

 applications; and

[[Page 119 STAT. 625]]

 ``(bb) unlikely to be used in 

 general purpose applications.''; and

 (3) by adding at the end the following:

 ``(32) The term `battery charger' means a device that 

 charges batteries for consumer products, including battery 

 chargers embedded in other consumer products.

 ``(33)(A) The term `commercial prerinse spray valve' means a 

 handheld device designed and marketed for use with commercial 

 dishwashing and ware washing equipment that sprays water on 

 dishes, flatware, and other food service items for the purpose 

 of removing food residue before cleaning the items.

 ``(B) The Secretary may modify the definition of `commercial 

 prerinse spray valve' by rule--

 ``(i) to include products--

 ``(I) that are extensively used in conjunction 

 with commercial dishwashing and ware washing 

 equipment;

 ``(II) the application of standards to which 

 would result in significant energy savings; and

 ``(III) the application of standards to which 

 would meet the criteria specified in section 

 325(o)(4); and

 ``(ii) to exclude products--

 ``(I) that are used for special food service 

 applications;

 ``(II) that are unlikely to be widely used in 

 conjunction with commercial dishwashing and ware 

 washing equipment; and

 ``(III) the application of standards to which 

 would not result in significant energy savings.

 ``(34) The term `dehumidifier' means a self-contained, 

 electrically operated, and mechanically encased assembly 

 consisting of--

 ``(A) a refrigerated surface (evaporator) that 

 condenses moisture from the atmosphere;

 ``(B) a refrigerating system, including an electric 

 motor;

 ``(C) an air-circulating fan; and

 ``(D) means for collecting or disposing of the 

 condensate.

 ``(35)(A) The term `distribution transformer' means a 

 transformer that--

 ``(i) has an input voltage of 34.5 kilovolts or 

 less;

 ``(ii) has an output voltage of 600 volts or less; 

 and

 ``(iii) is rated for operation at a frequency of 60 

 Hertz.

 ``(B) The term `distribution transformer' does not include--

 ``(i) a transformer with multiple voltage taps, the 

 highest of which equals at least 20 percent more than 

 the lowest;

 ``(ii) a transformer that is designed to be used in 

 a special purpose application and is unlikely to be used 

 in general purpose applications, such as a drive 

 transformer, rectifier transformer, auto-transformer, 

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 Uninterruptible Power System transformer, impedance 

 transformer, regulating transformer, sealed and 

 nonventilating transformer, machine tool transformer, 

 welding transformer, grounding transformer, or testing 

 transformer; or

 ``(iii) any transformer not listed in clause (ii) 

 that is excluded by the Secretary by rule because--

 ``(I) the transformer is designed for a 

 special application;

[[Page 119 STAT. 626]]

 ``(II) the transformer is unlikely to be used 

 in general purpose applications; and

 ``(III) the application of standards to the 

 transformer would not result in significant energy 

 savings.

 ``(36) The term `external power supply' means an external 

 power supply circuit that is used to convert household electric 

 current into DC current or lower-voltage AC current to operate a 

 consumer product.

 ``(37) The term `illuminated exit sign' means a sign that--

 ``(A) is designed to be permanently fixed in place 

 to identify an exit; and

 ``(B) consists of an electrically powered integral 

 light source that--

 ``(i) illuminates the legend `EXIT' and any 

 directional indicators; and

 ``(ii) provides contrast between the legend, 

 any directional indicators, and the background.

 ``(38) The term `low-voltage dry-type distribution 

 transformer' means a distribution transformer that--

 ``(A) has an input voltage of 600 volts or less;

 ``(B) is air-cooled; and

 ``(C) does not use oil as a coolant.

 ``(39) The term `pedestrian module' means a light signal 

 used to convey movement information to pedestrians.

 ``(40) The term `refrigerated bottled or canned beverage 

 vending machine' means a commercial refrigerator that cools 

 bottled or canned beverages and dispenses the bottled or canned 

 beverages on payment.

 ``(41) The term `standby mode' means the lowest power 

 consumption mode, as established on an individual product basis 

 by the Secretary, that--

 ``(A) cannot be switched off or influenced by the 

 user; and

 ``(B) may persist for an indefinite time when an 

 appliance is--

 ``(i) connected to the main electricity 

 supply; and

 ``(ii) used in accordance with the 

 instructions of the manufacturer.

 ``(42) The term `torchiere' means a portable electric lamp 

 with a reflector bowl that directs light upward to give indirect 

 illumination.

 ``(43) The term `traffic signal module' means a standard 8-

 inch (200mm) or 12-inch (300mm) traffic signal indication that--

 ``(A) consists of a light source, a lens, and all 

 other parts necessary for operation; and

 ``(B) communicates movement messages to drivers 

 through red, amber, and green colors.

 ``(44) The term `transformer' means a device consisting of 2 

 or more coils of insulated wire that transfers alternating 

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 current by electromagnetic induction from 1 coil to another to 

 change the original voltage or current value.

 ``(45)(A) The term `unit heater' means a self-contained fan-

 type heater designed to be installed within the heated space.

 ``(B) The term `unit heater' does not include a warm air 

 furnace.

[[Page 119 STAT. 627]]

 ``(46)(A) The term `high intensity discharge lamp' means an 

 electric-discharge lamp in which--

 ``(i) the light-producing arc is stabilized by bulb 

 wall temperature; and

 ``(ii) the arc tube has a bulb wall loading in 

 excess of 3 Watts/cm<SUP>2</SUP>.

 ``(B) The term `high intensity discharge lamp' includes 

 mercury vapor, metal halide, and high-pressure sodium lamps 

 described in subparagraph (A).

 ``(47)(A) The term `mercury vapor lamp' means a high 

 intensity discharge lamp in which the major portion of the light 

 is produced by radiation from mercury operating at a partial 

 pressure in excess of 100,000 Pa (approximately 1 atm).

 ``(B) The term `mercury vapor lamp' includes clear, 

 phosphor-coated, and self-ballasted lamps described in 

 subparagraph (A).

 ``(48) The term `mercury vapor lamp ballast' means a device 

 that is designed and marketed to start and operate mercury vapor 

 lamps by providing the necessary voltage and current.

 ``(49) The term `ceiling fan' means a nonportable device 

 that is suspended from a ceiling for circulating air via the 

 rotation of fan blades.

 ``(50) The term `ceiling fan light kit' means equipment 

 designed to provide light from a ceiling fan that can be--

 ``(A) integral, such that the equipment is attached 

 to the ceiling fan prior to the time of retail sale; or

 ``(B) attachable, such that at the time of retail 

 sale the equipment is not physically attached to the 

 ceiling fan, but may be included inside the ceiling fan 

 at the time of sale or sold separately for subsequent 

 attachment to the fan.

 ``(51) The term `medium screw base' means an Edison screw 

 base identified with the prefix E-26 in the `American National 

 Standard for Electric Lamp Bases', ANSI/IEC C81.61-2003, 

 published by the American National Standards Institute.''.

 (b) Test Procedures.--Section 323 of the Energy Policy and 

Conservation Act (42 U.S.C. 6293) is amended--

 (1) in subsection (b), by adding at the end the following:

 ``(9) Test procedures for illuminated exit signs shall be based on 

the test method used under version 2.0 of the Energy Star program of the 

Environmental Protection Agency for illuminated exit signs.

 ``(10)(A) Test procedures for distribution transformers and low 

voltage dry-type distribution transformers shall be based on the 

`Standard Test Method for Measuring the Energy Consumption of 

Distribution Transformers' prescribed by the National Electrical 

Manufacturers Association (NEMA TP 2-1998).

 ``(B) The Secretary may review and revise the test procedures 

established under subparagraph (A).

 ``(C) For purposes of section 346(a), the test procedures 

established under subparagraph (A) shall be considered to be the testing 

requirements prescribed by the Secretary under section 346(a)(1) for 

distribution transformers for which the Secretary makes a determination 

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that energy conservation standards would--

 ``(i) be technologically feasible and economically 

 justified; and

 ``(ii) result in significant energy savings.

[[Page 119 STAT. 628]]

 ``(11) Test procedures for traffic signal modules and pedestrian 

modules shall be based on the test method used under the Energy Star 

program of the Environmental Protection Agency for traffic signal 

modules, as in effect on the date of enactment of this paragraph.

 ``(12)(A) Test procedures for medium base compact fluorescent lamps 

shall be based on the test methods for compact fluorescent lamps used 

under the August 9, 2001, version of the Energy Star program of the 

Environmental Protection Agency and the Department of Energy.

 ``(B) Except as provided in subparagraph (C), medium base compact 

fluorescent lamps shall meet all test requirements for regulated 

parameters of section 325(cc).

 ``(C) Notwithstanding subparagraph (B), if manufacturers document 

engineering predictions and analysis that support expected attainment of 

lumen maintenance at 40 percent rated life and lamp lifetime, medium 

base compact fluorescent lamps may be marketed before completion of the 

testing of lamp life and lumen maintenance at 40 percent of rated life.

 ``(13) Test procedures for dehumidifiers shall be based on the test 

criteria used under the Energy Star Program Requirements for 

Dehumidifiers developed by the Environmental Protection Agency, as in 

effect on the date of enactment of this paragraph unless revised by the 

Secretary pursuant to this section.

 ``(14) The test procedure for measuring flow rate for commercial 

prerinse spray valves shall be based on American Society for Testing and 

Materials Standard F2324, entitled `Standard Test Method for Pre-Rinse 

Spray Valves'.

 ``(15) The test procedure for refrigerated bottled or canned 

beverage vending machines shall be based on American National Standards 

Institute/American Society of Heating, Refrigerating and AirConditioning Engineers Standard 32.1-2004, entitled `Methods of Testing 

for Rating Vending Machines for Bottled, Canned or Other Sealed 

Beverages'.

 ``(16)(A)(i) Test procedures for ceiling fans shall be based on the 

`Energy Star Testing Facility Guidance Manual: Building a Testing 

Facility and Performing the Solid State Test Method for ENERGY STAR 

Qualified Ceiling Fans, Version 1.1' published by the Environmental 

Protection Agency.

 ``(ii) Test procedures for ceiling fan light kits shall be based on 

the test procedures referenced in the Energy Star specifications for 

Residential Light Fixtures and Compact Fluorescent Light Bulbs, as in 

effect on the date of enactment of this paragraph.

 ``(B) The Secretary may review and revise the test procedures 

established under subparagraph (A).''; and

 (2) by adding at the end the following:

 ``(f) Additional <<NOTE: Deadline. Requirements.>> Consumer and 

Commercial Products.--(1) Not later than 2 years after the date of 

enactment of this subsection, the Secretary shall prescribe testing 

requirements for refrigerated bottled or canned beverage vending 

machines.

 ``(2) To the maximum extent practicable, the testing requirements 

prescribed under paragraph (1) shall be based on existing test 

procedures used in industry.''.

 (c) Standard Setting Authority.--Section 325 of the Energy Policy 

and Conservation Act (42 U.S.C. 6295) is amended--

 (1) in subsection (f)(3), by adding at the end the 

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 following:

[[Page 119 STAT. 629]]

 ``(D) Notwithstanding any other provision of this Act, if the 

requirements of subsection (o) are met, the Secretary may consider and 

prescribe energy conservation standards or energy use standards for 

electricity used for purposes of circulating air through duct work.'';

 (2) in subsection (g)--

 (A) in paragraph (6)(B), by inserting ``and 

 labeled'' after ``designed''; and

 (B) by adding at the end the following:

 ``(8)(A) Each fluorescent lamp ballast (other than replacement 

ballasts or ballasts described in subparagraph (C))--

 ``(i)(I) manufactured on or after July 1, 2009;

 ``(II) sold by the manufacturer on or after October 1, 2009; 

 or

 ``(III) incorporated into a luminaire by a luminaire 

 manufacturer on or after July 1, 2010; and

 ``(ii) designed--

 ``(I) to operate at nominal input voltages of 120 or 

 277 volts;

 ``(II) to operate with an input current frequency of 

 60 Hertz; and

 ``(III) for use in connection with F34T12 lamps, 

 F96T12/ES lamps, or F96T12HO/ES lamps;

 shall have a power factor of 0.90 or greater and shall have a 

 ballast efficacy factor of not less than the following:

 ................... Total .....................

``Applica Ballast nominal Ballast

 tion for input lamp efficacy

 operatio voltage watts factor

 n of

One 120/277 34 2.61

 F34T12

 lamp

Two 120/277 68 1.35

 F34T12

 lamps

Two 120/277 120 0.77

 F96T12/

 ES lamps

Two 120/277 190 0.42.

 F96T12HO/

 ES lamps

 ``(B) <<NOTE: Applicability.>> The standards described in 

subparagraph (A) shall apply to all ballasts covered by subparagraph 

(A)(ii) that are manufactured on or after July 1, 2010, or sold by the 

manufacturer on or after October 1, 2010.

 ``(C) The standards described in subparagraph (A) do not apply to--

 ``(i) a ballast that is designed for dimming to 50 percent 

 or less of the maximum output of the ballast;

 ``(ii) a ballast that is designed for use with 2 F96T12HO 

 lamps at ambient temperatures of 20F or less and for use in an 

 outdoor sign; or

 ``(iii) a ballast that has a power factor of less than 0.90 

 and is designed and labeled for use only in residential 

 applications.'';

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 (3) in subsection (o), by adding at the end the following:

 ``(5) The Secretary may set more than 1 energy conservation standard 

for products that serve more than 1 major function by setting 1 energy 

conservation standard for each major function.''; and

 (4) by adding at the end the following:

 ``(u) Battery <<NOTE: Deadline. Notice. Regulations.>> Charger and 

External Power Supply Electric Energy Consumption.--(1)(A) Not later 

than 18 months after the date of enactment of this subsection, the 

Secretary shall, after providing notice and an opportunity for comment, 

prescribe, by

[[Page 119 STAT. 630]]

rule, definitions and test procedures for the power use of battery 

chargers and external power supplies.

 ``(B) In establishing the test procedures under subparagraph (A), 

the Secretary shall--

 ``(i) consider existing definitions and test procedures used 

 for measuring energy consumption in standby mode and other 

 modes; and

 ``(ii) assess the current and projected future market for 

 battery chargers and external power supplies.

 ``(C) The assessment under subparagraph (B)(ii) shall include--

 ``(i) estimates of the significance of potential energy 

 savings from technical improvements to battery chargers and 

 external power supplies; and

 ``(ii) suggested product classes for energy conservation 

 standards.

 ``(D) <<NOTE: Deadline.>> Not later than 18 months after the date of 

enactment of this subsection, the Secretary shall hold a scoping 

workshop to discuss and receive comments on plans for developing energy 

conservation standards for energy use for battery chargers and external 

power supplies.

 ``(E)(i) <<NOTE: Deadline. Regultions.>> Not later than 3 years 

after the date of enactment of this subsection, the Secretary shall 

issue a final rule that determines whether energy conservation standards 

shall be issued for battery chargers and external power supplies or 

classes of battery chargers and external power supplies.

 ``(ii) For each product class, any energy conservation standards 

issued under clause (i) shall be set at the lowest level of energy use 

that--

 ``(I) meets the criteria and procedures of subsections (o), 

 (p), (q), (r), (s), and (t); and

 ``(II) would result in significant overall annual energy 

 savings, considering standby mode and other operating modes.

 ``(2) In determining under section 323 whether test procedures and 

energy conservation standards under this section should be revised with 

respect to covered products that are major sources of standby mode 

energy consumption, the Secretary shall consider whether to incorporate 

standby mode into the test procedures and energy conservation standards, 

taking into account standby mode power consumption compared to overall 

product energy consumption.

 ``(3) The Secretary shall not propose an energy conservation 

standard under this section, unless the Secretary has issued applicable 

test procedures for each product under section 323.

 ``(4) <<NOTE: Applicability. Effective date.>> Any energy 

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conservation standard issued under this subsection shall be applicable 

to products manufactured or imported beginning on the date that is 3 

years after the date of issuance.

 ``(5) The Secretary and the Administrator shall collaborate and 

develop programs (including programs under section 324A and other 

voluntary industry agreements or codes of conduct) that are designed to 

reduce standby mode energy use.

 ``(v) Ceiling <<NOTE: Deadline. Regulations.>> Fans and Refrigerated 

Beverage Vending Machines.--(1) Not later than 1 year after the date of 

enactment of this subsection, the Secretary shall prescribe, by rule, 

test procedures and energy conservation standards for ceiling fans and 

ceiling fan light kits. If the Secretary sets such standards, the 

Secretary shall consider exempting or setting different standards for 

certain product classes for which the primary standards are not 

technically

[[Page 119 STAT. 631]]

feasible or economically justified, and establishing separate or 

exempted product classes for highly decorative fans for which air 

movement performance is a secondary design feature.

 ``(2) <<NOTE: Deadline. Regulations.>> Not later than 4 years after 

the date of enactment of this subsection, the Secretary shall prescribe, 

by rule, energy conservation standards for refrigerated bottle or canned 

beverage vending machines.

 ``(3) In establishing energy conservation standards under this 

subsection, the Secretary shall use the criteria and procedures 

prescribed under subsections (o) and (p).

 ``(4) <<NOTE: Applicability.>> Any energy conservation standard 

prescribed under this subsection shall apply to products manufactured 3 

years after the date of publication of a final rule establishing the 

energy conservation standard.

 ``(w) Illuminated Exit Signs.--An illuminated exit sign manufactured 

on or after January 1, 2006, shall meet the version 2.0 Energy Star 

Program performance requirements for illuminated exit signs prescribed 

by the Environmental Protection Agency.

 ``(x) Torchieres.--A torchiere manufactured on or after January 1, 

2006--

 ``(1) shall consume not more than 190 watts of power; and

 ``(2) shall not be capable of operating with lamps that 

 total more than 190 watts.

 ``(y) Low Voltage Dry-Type Distribution Transformers.--The 

efficiency of a low voltage dry-type distribution transformer 

manufactured on or after January 1, 2007, shall be the Class I 

Efficiency Levels for distribution transformers specified in table 4-2 

of the `Guide for Determining Energy Efficiency for Distribution 

Transformers' published by the National Electrical Manufacturers 

Association (NEMA TP-1-2002).

 ``(z) Traffic Signal Modules and Pedestrian Modules.--Any traffic 

signal module or pedestrian module manufactured on or after January 1, 

2006, shall--

 ``(1) meet the performance requirements used under the 

 Energy Star program of the Environmental Protection Agency for 

 traffic signals, as in effect on the date of enactment of this 

 subsection; and

 ``(2) be installed with compatible, electrically connected 

 signal control interface devices and conflict monitoring 

 systems.

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 ``(aa) Unit Heaters.--A unit heater manufactured on or after the 

date that is 3 years after the date of enactment of this subsection 

shall--

 ``(1) be equipped with an intermittent ignition device; and

 ``(2) have power venting or an automatic flue damper.

 ``(bb) Medium Base Compact Fluorescent Lamps.--(1) A bare lamp and 

covered lamp (no reflector) medium base compact fluorescent lamp 

manufactured on or after January 1, 2006, shall meet the following 

requirements prescribed by the August 9, 2001, version of the Energy 

Star Program Requirements for Compact Fluorescent Lamps, Energy Star 

Eligibility Criteria, Energy-Efficiency Specification issued by the 

Environmental Protection Agency and Department of Energy:

 ``(A) Minimum initial efficacy.

 ``(B) Lumen maintenance at 1000 hours.

 ``(C) Lumen maintenance at 40 percent of rated life.

 ``(D) Rapid cycle stress test.

[[Page 119 STAT. 632]]

 ``(E) Lamp life.

 ``(2) The Secretary may, by rule, establish requirements for color 

quality (CRI), power factor, operating frequency, and maximum allowable 

start time based on the requirements prescribed by the August 9, 2001, 

version of the Energy Star Program Requirements for Compact Fluorescent 

Lamps.

 ``(3) The Secretary may, by rule--

 ``(A) revise the requirements established under paragraph 

 (2); or

 ``(B) establish other requirements, after considering energy 

 savings, cost effectiveness, and consumer satisfaction.

 ``(cc) Dehumidifiers.--(1) Dehumidifiers manufactured on or after 

October 1, 2007, shall have an Energy Factor that meets or exceeds the 

following values:

``Product Capacity (pints/day)Minimum Energy Factor (Liters/kWh)........

25.00 or less 1.00 

25.01 - 35.00 1.20 

35.01 - 54.00 1.30 

54.01 - 74.99 1.50 

75.00 or more 2.25.

 ``(2)(A) <<NOTE: Deadline. Publication. Regulations.>> Not later 

than October 1, 2009, the Secretary shall publish a final rule in 

accordance with subsections (o) and (p), to determine whether the energy 

conservation standards established under paragraph (1) should be 

amended.

 ``(B) The final rule published under subparagraph (A) shall--

 ``(i) contain any amendment by the Secretary; and

 ``(ii) <<NOTE: Applicability.>> provide that the amendment 

 applies to products manufactured on or after October 1, 2012.

 ``(C) If the Secretary does not publish an amendment that takes 

effect by October 1, 2012, dehumidifiers manufactured on or after 

October 1, 2012, shall have an Energy Factor that meets or exceeds the 

following values:

``Product Capacity (pints/day)Minimum Energy Factor (Liters/kWh)........

25.00 or less 1.20 

25.01 - 35.00 1.30 

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35.01 - 45.00 1.40 

45.01 - 54.00 1.50 

54.01 - 74.99 1.60 

75.00 or more 2.5.

 ``(dd) Commercial Prerinse Spray Valves.--Commercial prerinse spray 

valves manufactured on or after January 1, 2006, shall have a flow rate 

of not more than 1.6 gallons per minute.

 ``(ee) Mercury Vapor Lamp Ballasts.--Mercury vapor lamp ballasts 

shall not be manufactured or imported after January 1, 2008.

 ``(ff) Ceiling Fans and Ceiling Fan Light Kits.--(1)(A) All ceiling 

fans manufactured on or after January 1, 2007, shall have the following 

features:

 ``(i) Fan speed controls separate from any lighting 

 controls.

 ``(ii) Adjustable speed controls (either more than 1 speed 

 or variable speed).

 ``(iii) Adjustable speed controls (either more than 1 speed 

 or variable speed).

 ``(iv) The capability of reversible fan action, except for--

[[Page 119 STAT. 633]]

 ``(I) fans sold for industrial applications;

 ``(II) outdoor applications; and

 ``(III) cases in which safety standards would be 

 violated by the use of the reversible mode.

 ``(B) The Secretary may define the exceptions described in clause 

(iv) in greater detail, but shall not substantively expand the 

exceptions.

 ``(2)(A) Ceiling fan light kits with medium screw base sockets 

manufactured on or after January 1, 2007, shall be packaged with screwbased lamps to fill all screw base sockets.

 ``(B) The screw-based lamps required under subparagraph (A) shall--

 ``(i) meet the Energy Star Program Requirements for Compact 

 Fluorescent Lamps, version 3.0, issued by the Department of 

 Energy; or

 ``(ii) use light sources other than compact fluorescent 

 lamps that have lumens per watt performance at least equivalent 

 to comparably configured compact fluorescent lamps meeting the 

 Energy Star Program Requirements described in clause (i).

 ``(3) Ceiling fan light kits with pin-based sockets for fluorescent 

lamps manufactured on or after January 1, 2007 shall--

 ``(A) meet the Energy Star Program Requirements for 

 Residential Light Fixtures version 4.0 issued by the 

 Environmental Protection Agency; and

 ``(B) be packaged with lamps to fill all sockets.

 ``(4)(A) <<NOTE: Deadline. Requirements.>> By January 1, 2007, the 

Secretary shall consider and issue requirements for any ceiling fan 

lighting kits other than those covered in paragraphs (2) and (3), 

including candelabra screw base sockets.

 ``(B) The requirements issued under subparagraph (A) shall be 

effective for products manufactured 2 years after the date of the final 

rule.

 ``(C) If the Secretary fails to issue a final rule by the date 

specified in subparagraph (B), any type of ceiling fan lighting kit 

described in subparagraph (A) that is manufactured after January 1, 

2009--

 ``(i) shall not be capable of operating with lamps that 

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 total more than 190 watts; and

 ``(ii) shall include the lamps described in clause (i) in 

 the ceiling fan lighting kits.

 ``(5)(A) After January 1, 2010, the Secretary may consider, and 

issue, if the requirements of subsections (o) and (p) are met, amended 

energy efficiency standards for ceiling fan light kits.

 ``(B) <<NOTE: Applicability.>> Any amended standards issued under 

subparagraph (A) shall apply to products manufactured not earlier than 2 

years after the date of publication of the final rule establishing the 

amended standard.

 ``(6)(A) Notwithstanding any other provision of this Act, the 

Secretary may consider, and issue, if the requirements of subsections 

(o) and (p) are met, energy efficiency or energy use standards for 

electricity used by ceiling fans to circulate air in a room.

 ``(B) In issuing the standards under subparagraph (A), the Secretary 

shall consider--

 ``(C) exempting, or setting different standards for, certain 

 product classes for which the primary standards are not 

 technically feasible or economically justified; and

[[Page 119 STAT. 634]]

 ``(D) establishing separate exempted product classes for 

 highly decorative fans for which air movement performance is a 

 secondary design feature.

 ``(7) <<NOTE: Applicability.>> Section 327 shall apply to the 

products covered in paragraphs (1) through (4) beginning on the date of 

enactment of this subsection, except that any State or local labeling 

requirement for ceiling fans prescribed or enacted before the date of 

enactment of this subsection shall not be preempted until the labeling 

requirements applicable to ceiling fans established under section 327 

take effect.

 ``(gg) Application Date.--Section 327 applies--

 ``(1) to products for which energy conservation standards 

 are to be established under subsection (l), (u), or (v) 

 beginning on the date on which a final rule is issued by the 

 Secretary, except that any State or local standard prescribed or 

 enacted for the product before the date on which the final rule 

 is issued shall not be preempted until the energy conservation 

 standard established under subsection (l), (u), or (v) for the 

 product takes effect; and

 ``(2) to products for which energy conservation standards 

 are established under subsections (w) through (ff) on the date 

 of enactment of those subsections, except that any State or 

 local standard prescribed or enacted before the date of 

 enactment of those subsections shall not be preempted until the 

 energy conservation standards established under subsections (w) 

 through (ff) take effect.''.

 (d) General Rule of Preemption.--Section 327(c) of the Energy Policy 

and Conservation Act (42 U.S.C. 6297(c)) is amended--

 (1) in paragraph (5), by striking ``or'' at the end;

 (2) in paragraph (6), by striking the period at the end and 

 inserting ``; or''; and

 (3) by adding at the end the following:

 ``(7)(A) is a regulation concerning standards for commercial 

 prerinse spray valves adopted by the California Energy 

 Commission before January 1, 2005; or

 ``(B) is an amendment to a regulation described in 

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 subparagraph (A) that was developed to align California 

 regulations with changes in American Society for Testing and 

 Materials Standard F2324;

 ``(8)(A) is a regulation concerning standards for pedestrian 

 modules adopted by the California Energy Commission before 

 January 1, 2005; or

 ``(B) is an amendment to a regulation described in 

 subparagraph (A) that was developed to align California 

 regulations to changes in the Institute for Transportation 

 Engineers standards, entitled `Performance Specification: 

 Pedestrian Traffic Control Signal Indications'.''.

SEC. 136. ENERGY CONSERVATION STANDARDS FOR COMMERCIAL EQUIPMENT.

 (a) Definitions.--Section 340 of the Energy Policy and Conservation 

Act (42 U.S.C. 6311) is amended--

 (1) in paragraph (1)--

 (A) by redesignating subparagraphs (D) through (G) 

 as subparagraphs (H) through (K), respectively; and

 (B) by inserting after subparagraph (C) the 

 following:

[[Page 119 STAT. 635]]

 ``(D) Very large commercial package air conditioning 

 and heating equipment.

 ``(E) Commercial refrigerators, freezers, and 

 refrigerator-freezers.

 ``(F) Automatic commercial ice makers.

 ``(G) Commercial clothes washers.'';

 (2) in paragraph (2)(B), by striking ``small and large 

 commercial package air conditioning and heating equipment'' and 

 inserting ``commercial package air conditioning and heating 

 equipment, commercial refrigerators, freezers, and refrigerator-

 freezers, automatic commercial ice makers, commercial clothes 

 washers'';

 (3) by striking paragraphs (8) and (9) and inserting the 

 following:

 ``(8)(A) The term `commercial package air conditioning and 

 heating equipment' means air-cooled, water-cooled, 

 evaporatively-cooled, or water source (not including ground 

 water source) electrically operated, unitary central air 

 conditioners and central air conditioning heat pumps for 

 commercial application.

 ``(B) The term `small commercial package air conditioning 

 and heating equipment' means commercial package air conditioning 

 and heating equipment that is rated below 135,000 Btu per hour 

 (cooling capacity).

 ``(C) The term `large commercial package air conditioning 

 and heating equipment' means commercial package air conditioning 

 and heating equipment that is rated--

 ``(i) at or above 135,000 Btu per hour; and

 ``(ii) below 240,000 Btu per hour (cooling 

 capacity).

 ``(D) The term `very large commercial package air 

 conditioning and heating equipment' means commercial package air 

 conditioning and heating equipment that is rated--

 ``(i) at or above 240,000 Btu per hour; and

 ``(ii) below 760,000 Btu per hour (cooling 

 capacity).

 ``(9)(A) The term `commercial refrigerator, freezer, and 

 refrigerator-freezer' means refrigeration equipment that--

 ``(i) is not a consumer product (as defined in 

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 section 321);

 ``(ii) is not designed and marketed exclusively for 

 medical, scientific, or research purposes;

 ``(iii) operates at a chilled, frozen, combination 

 chilled and frozen, or variable temperature;

 ``(iv) displays or stores merchandise and other 

 perishable materials horizontally, semivertically, or 

 vertically;

 ``(v) has transparent or solid doors, sliding or 

 hinged doors, a combination of hinged, sliding, 

 transparent, or solid doors, or no doors;

 ``(vi) is designed for pull-down temperature 

 applications or holding temperature applications; and

 ``(vii) is connected to a self-contained condensing 

 unit or to a remote condensing unit.

 ``(B) The term `holding temperature application' means a use 

 of commercial refrigeration equipment other than a pull-down 

 temperature application, except a blast chiller or freezer.

 ``(C) The term `integrated average temperature' means the 

 average temperature of all test package measurements taken 

 during the test.

[[Page 119 STAT. 636]]

 ``(D) The term `pull-down temperature application' means a 

 commercial refrigerator with doors that, when fully loaded with 

 12 ounce beverage cans at 90 degrees F, can cool those beverages 

 to an average stable temperature of 38 degrees F in 12 hours or 

 less.

 ``(E) The term `remote condensing unit' means a factory-made 

 assembly of refrigerating components designed to compress and 

 liquefy a specific refrigerant that is remotely located from the 

 refrigerated equipment and consists of one or more refrigerant 

 compressors, refrigerant condensers, condenser fans and motors, 

 and factory supplied accessories.

 ``(F) The term `self-contained condensing unit' means a 

 factory-made assembly of refrigerating components designed to 

 compress and liquefy a specific refrigerant that is an integral 

 part of the refrigerated equipment and consists of one or more 

 refrigerant compressors, refrigerant condensers, condenser fans 

 and motors, and factory supplied accessories.''; and

 (4) by adding at the end the following:

 ``(19) The term `automatic commercial ice maker' means a 

 factory-made assembly (not necessarily shipped in one package) 

 that--

 ``(A) consists of a condensing unit and ice-making 

 section operating as an integrated unit, with means for 

 making and harvesting ice; and

 ``(B) may include means for storing ice, dispensing 

 ice, or storing and dispensing ice.

 ``(20) The term `commercial clothes washer' means a soft-

 mount front-loading or soft-mount top-loading clothes washer 

 that--

 ``(A) has a clothes container compartment that--

 ``(i) for horizontal-axis clothes washers, is 

 not more than 3.5 cubic feet; and

 ``(ii) for vertical-axis clothes washers, is 

 not more than 4.0 cubic feet; and

 ``(B) is designed for use in--

 ``(i) applications in which the occupants of 

 more than one household will be using the clothes 

 washer, such as multi-family housing common areas 

 and coin laundries; or

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 ``(ii) other commercial applications.

 ``(21) The term `harvest rate' means the amount of ice (at 

 32 degrees F) in pounds produced per 24 hours.''.

 (b) Standards for Commercial Package Air Conditioning and Heating 

Equipment.--Section 342(a) of the Energy Policy and Conservation Act (42 

U.S.C. 6313(a)) is amended--

 (1) in the subsection heading, by striking ``Small and 

 Large'' and inserting ``Small, Large, and Very Large'';

 (2) in paragraph (1), by inserting ``but before January 1, 

 2010,'' after ``January 1, 1994,'';

 (3) in paragraph (2), by inserting ``but before January 1, 

 2010,'' after ``January 1, 1995,''; and

 (4) in paragraph (6)--

 (A) in subparagraph (A)--

 (i) by inserting ``(i)'' after ``(A)'';

 (ii) by striking ``the date of enactment of 

 the Energy Policy Act of 1992'' and inserting 

 ``January 1, 2010'';

[[Page 119 STAT. 637]]

 (iii) by inserting after ``large commercial 

 package air conditioning and heating equipment,'' 

 the following: ``and very large commercial package 

 air conditioning and heating equipment, or if 

 ASHRAE/IES Standard 90.1, as in effect on October 

 24, 1992, is amended with respect to any''; and

 (iv) by adding at the end the following:

 ``(ii) If ASHRAE/IES Standard 90.1 is not amended with respect to 

small commercial package air conditioning and heating equipment, large 

commercial package air conditioning and heating equipment, and very 

large commercial package air conditioning and heating equipment during 

the 5-year period beginning on the effective date of a standard, the 

Secretary may initiate a rulemaking to determine whether a more 

stringent standard--

 ``(I) would result in significant additional conservation of 

 energy; and

 ``(II) is technologically feasible and economically 

 justified.''; and

 (B) in subparagraph (C)(ii), by inserting ``and very 

 large commercial package air conditioning and heating 

 equipment'' after ``large commercial package air 

 conditioning and heating equipment''; and

 (5) by adding at the end the following:

 ``(7) Small commercial package air conditioning and heating 

equipment manufactured on or after January 1, 2010, shall meet the 

following standards:

 ``(A) The minimum energy efficiency ratio of air-cooled 

 central air conditioners at or above 65,000 Btu per hour 

 (cooling capacity) and less than 135,000 Btu per hour (cooling 

 capacity) shall be--

 ``(i) 11.2 for equipment with no heating or electric 

 resistance heating; and

 ``(ii) 11.0 for equipment with all other heating 

 system types that are integrated into the equipment (at 

 a standard rating of 95 degrees F db).

 ``(B) The minimum energy efficiency ratio of air-cooled 

 central air conditioner heat pumps at or above 65,000 Btu per 

 hour (cooling capacity) and less than 135,000 Btu per hour 

 (cooling capacity) shall be--

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 ``(i) 11.0 for equipment with no heating or electric 

 resistance heating; and

 ``(ii) 10.8 for equipment with all other heating 

 system types that are integrated into the equipment (at 

 a standard rating of 95 degrees F db).

 ``(C) The minimum coefficient of performance in the heating 

 mode of air-cooled central air conditioning heat pumps at or 

 above 65,000 Btu per hour (cooling capacity) and less than 

 135,000 Btu per hour (cooling capacity) shall be 3.3 (at a high 

 temperature rating of 47 degrees F db).

 ``(8) Large commercial package air conditioning and heating 

equipment manufactured on or after January 1, 2010, shall meet the 

following standards:

 ``(A) The minimum energy efficiency ratio of air-cooled 

 central air conditioners at or above 135,000 Btu per hour 

 (cooling capacity) and less than 240,000 Btu per hour (cooling 

 capacity) shall be--

[[Page 119 STAT. 638]]

 ``(i) 11.0 for equipment with no heating or electric 

 resistance heating; and

 ``(ii) 10.8 for equipment with all other heating 

 system types that are integrated into the equipment (at 

 a standard rating of 95 degrees F db).

 ``(B) The minimum energy efficiency ratio of air-cooled 

 central air conditioner heat pumps at or above 135,000 Btu per 

 hour (cooling capacity) and less than 240,000 Btu per hour 

 (cooling capacity) shall be--

 ``(i) 10.6 for equipment with no heating or electric 

 resistance heating; and

 ``(ii) 10.4 for equipment with all other heating 

 system types that are integrated into the equipment (at 

 a standard rating of 95 degrees F db).

 ``(C) The minimum coefficient of performance in the heating 

 mode of air-cooled central air conditioning heat pumps at or 

 above 135,000 Btu per hour (cooling capacity) and less than 

 240,000 Btu per hour (cooling capacity) shall be 3.2 (at a high 

 temperature rating of 47 degrees F db).

 ``(9) Very large commercial package air conditioning and heating 

equipment manufactured on or after January 1, 2010, shall meet the 

following standards:

 ``(A) The minimum energy efficiency ratio of air-cooled 

 central air conditioners at or above 240,000 Btu per hour 

 (cooling capacity) and less than 760,000 Btu per hour (cooling 

 capacity) shall be--

 ``(i) 10.0 for equipment with no heating or electric 

 resistance heating; and

 ``(ii) 9.8 for equipment with all other heating 

 system types that are integrated into the equipment (at 

 a standard rating of 95 degrees F db).

 ``(B) The minimum energy efficiency ratio of air-cooled 

 central air conditioner heat pumps at or above 240,000 Btu per 

 hour (cooling capacity) and less than 760,000 Btu per hour 

 (cooling capacity) shall be--

 ``(i) 9.5 for equipment with no heating or electric 

 resistance heating; and

 ``(ii) 9.3 for equipment with all other heating 

 system types that are integrated into the equipment (at 

 a standard rating of 95 degrees F db).

 ``(C) The minimum coefficient of performance in the heating 

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 mode of air-cooled central air conditioning heat pumps at or 

 above 240,000 Btu per hour (cooling capacity) and less than 

 760,000 Btu per hour (cooling capacity) shall be 3.2 (at a high 

 temperature rating of 47 degrees F db).''.

 (c) Standards for Commercial Refrigerators, Freezers, and 

Refrigerator-Freezers.--Section 342 of the Energy Policy and 

Conservation Act (42 U.S.C. 6313) is amended by adding at the end the 

following:

 ``(c) Commercial Refrigerators, Freezers, and RefrigeratorFreezers.--(1) In this subsection:

 ``(A) The term `AV' means the adjusted volume 

 (ft<SUP>3</SUP>) (defined as 1.63 x frozen temperature 

 compartment volume (ft<SUP>3</SUP>) + chilled temperature 

 compartment volume (ft<SUP>3</SUP>)) with compartment volumes 

 measured in accordance with the Association of Home Appliance 

 Manufacturers Standard HRF1-1979.

[[Page 119 STAT. 639]]

 ``(B) The term `V' means the chilled or frozen compartment 

 volume (ft<SUP>3</SUP>) (as defined in the Association of Home 

 Appliance Manufacturers Standard HRF1-1979).

 ``(C) Other terms have such meanings as may be established 

 by the Secretary, based on industry-accepted definitions and 

 practice.

 ``(2) Each commercial refrigerator, freezer, and refrigeratorfreezer with a self-contained condensing unit designed for holding 

temperature applications manufactured on or after January 1, 2010, shall 

have a daily energy consumption (in kilowatt hours per day) that does 

not exceed the following:

 Refrigerators with solid doors.. 0.10 V + 2.04

 Refrigerators with transparent 0.12 V + 3.34

 doors.

 Freezers with solid doors....... 0.40 V + 1.38

 Freezers with transparent doors. 0.75 V + 4.10

 Refrigerators/freezers with 0.27 AV - 0.71 or 0.70.

 solid doors the greater of.

 ``(3) Each commercial refrigerator with a self-contained condensing 

unit designed for pull-down temperature applications and transparent 

doors manufactured on or after January 1, 2010, shall have a daily 

energy consumption (in kilowatt hours per day) of not more than 0.126 V 

+ 3.51.

 ``(4)(A) <<NOTE: Deadline. Regulations.>> Not later than January 1, 

2009, the Secretary shall issue, by rule, standard levels for ice-cream 

freezers, self-contained commercial refrigerators, freezers, and 

refrigerator-freezers without doors, and remote condensing commercial 

refrigerators, freezers, and refrigerator-freezers, with the standard 

levels effective for equipment manufactured on or after January 1, 2012.

 ``(B) The Secretary may issue, by rule, standard levels for other 

types of commercial refrigerators, freezers, and refrigerator-freezers 

not covered by paragraph (2)(A) with the standard levels effective for 

equipment manufactured 3 or more years after the date on which the final 

rule is published.

 ``(5)(A) <<NOTE: Deadlines. Regulations.>> Not later than January 1, 

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2013, the Secretary shall issue a final rule to determine whether the 

standards established under this subsection should be amended.

 ``(B) Not later than 3 years after the effective date of any amended 

standards under subparagraph (A) or the publication of a final rule 

determining that the standards should not be amended, the Secretary 

shall issue a final rule to determine whether the standards established 

under this subsection or the amended standards, as applicable, should be 

amended.

 ``(C) <<NOTE: Applicability.>> If the Secretary issues a final rule 

under subparagraph (A) or (B) establishing amended standards, the final 

rule shall provide that the amended standards apply to products 

manufactured on or after the date that is--

 ``(i) 3 years after the date on which the final amended 

 standard is published; or

 ``(ii) if the Secretary determines, by rule, that 3 years is 

 inadequate, not later than 5 years after the date on which the 

 final rule is published.''.

 (d) Standards for Automatic Commercial Ice Makers.--Section 342 of 

the Energy Policy and Conservation Act (42 U.S.C.

[[Page 119 STAT. 640]]

6313) (as amended by subsection (c)) is amended by adding at the end the 

following:

 ``(d) Automatic Commercial Ice Makers.--(1) Each automatic 

commercial ice maker that produces cube type ice with capacities between 

50 and 2500 pounds per 24-hour period when tested according to the test 

standard established in section 343(a)(7) and is manufactured on or 

after January 1, 2010, shall meet the following standard levels:

 

------------------------------------------------------------------------------------------------------

 Maximum 

 Equipment Type Type of Harvest Rate (lbs ice/ Maximum Energy Use Water Us

 Cooling 24 hours) (kWh/100 lbs Ice) lbs 

------------------------------------------------------------------------------------------------------

Ice Making Head Water <500 7.80-0.0055H 200-0.02

 --------------------------------------------------------

 500 and <1436 5.58-0.0011H 200-0.02

 --------------------------------------------------------

 1436 4.0 200-0.02

------------------------------------------------------------------------------------------------------

Ice Making Head Air <450 10.26-0.0086H Not Appl

 --------------------------------------------------------

 450 6.89-0.0011H Not Appl

------------------------------------------------------------------------------------------------------

Remote Condensing Air <1000 8.85-0.0038H Not Appl

(but not remote

compressor)

 --------------------------------------------------------

 1000 5.10 Not Appl

------------------------------------------------------------------------------------------------------

Remote Condensing Air <934 8.85-0.0038H Not Appl

and Remote

Compressor

 --------------------------------------------------------

 934 5.3 Not Appl

------------------------------------------------------------------------------------------------------

Self Contained Water <200 11.40-0.019H 191-0.03

 --------------------------------------------------------

 200 7.60 191-0.03

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------------------------------------------------------------------------------------------------------

Self Contained Air <175 18.0-0.0469H Not Appl

 --------------------------------------------------------

 175 9.80 Not Appl

------------------------------------------------------------------------------------------------------

H = Harvest rate in pounds per 24 hours.

Water use is for the condenser only and does not include potable water used to make ice.

 ``(2)(A) The Secretary may issue, by rule, standard levels for types 

of automatic commercial ice makers that are not covered by paragraph 

(1).

 ``(B) <<NOTE: Applicability.>> The standards established under 

subparagraph (A) shall apply to products manufactured on or after the 

date that is--

 ``(i) 3 years after the date on which the rule is published 

 under subparagraph (A); or

[[Page 119 STAT. 641]]

 ``(ii) <<NOTE: Deadline.>> if the Secretary determines, by 

 rule, that 3 years is inadequate, not later than 5 years after 

 the date on which the final rule is published.

 ``(3)(A) <<NOTE: Deadlines. Regulations.>> Not later than January 1, 

2015, with respect to the standards established under paragraph (1), 

and, with respect to the standards established under paragraph (2), not 

later than 5 years after the date on which the standards take effect, 

the Secretary shall issue a final rule to determine whether amending the 

applicable standards is technologically feasible and economically 

justified.

 ``(B) Not later than 5 years after the effective date of any amended 

standards under subparagraph (A) or the publication of a final rule 

determining that amending the standards is not technologically feasible 

or economically justified, the Secretary shall issue a final rule to 

determine whether amending the standards established under paragraph (1) 

or the amended standards, as applicable, is technologically feasible or 

economically justified.

 ``(C) <<NOTE: Applicability.>> If the Secretary issues a final rule 

under subparagraph (A) or (B) establishing amended standards, the final 

rule shall provide that the amended standards apply to products 

manufactured on or after the date that is--

 ``(i) 3 years after the date on which the final amended 

 standard is published; or

 ``(ii) if the Secretary determines, by rule, that 3 years is 

 inadequate, not later than 5 years after the date on which the 

 final amended standard is published.

 ``(4) A final rule issued under paragraph (2) or (3) shall establish 

standards at the maximum level that is technically feasible and 

economically justified, as provided in subsections (o) and (p) of 

section 325.''.

 (e) Standards for Commercial Clothes Washers.--Section 342 of the 

Energy Policy and Conservation Act (42 U.S.C. 6313) (as amended by 

subsection (d)) is amended by adding at the end the following:

 ``(e) Commercial Clothes Washers.--(1) Each commercial clothes 

washer manufactured on or after January 1, 2007, shall have--

 ``(A) a Modified Energy Factor of at least 1.26; and

 ``(B) a Water Factor of not more than 9.5.

 ``(2)(A)(i) <<NOTE: Deadlines. Publication. Regulations.>> Not later 

than January 1, 2010, the Secretary shall publish a final rule to 

determine whether the standards established under paragraph (1) should 

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be amended.

 ``(ii) <<NOTE: Applicability.>> The rule published under clause (i) 

shall provide that any amended standard shall apply to products 

manufactured 3 years after the date on which the final amended standard 

is published.

 ``(B)(i) Not later than January 1, 2015, the Secretary shall publish 

a final rule to determine whether the standards established under 

paragraph (1) should be amended.

 ``(ii) <<NOTE: Applicability.>> The rule published under clause (i) 

shall provide that any amended standard shall apply to products 

manufactured 3 years after the date on which the final amended standard 

is published.''.

 (f) Test Procedures.--Section 343 of the Energy Policy and 

Conservation Act (42 U.S.C. 6314) is amended--

 (1) in subsection (a)--

 (A) in paragraph (4)--

[[Page 119 STAT. 642]]

 (i) in subparagraph (A), by inserting ``very 

 large commercial package air conditioning and 

 heating equipment,'' after ``large commercial 

 package air conditioning and heating equipment,''; 

 and

 (ii) in subparagraph (B), by inserting ``very 

 large commercial package air conditioning and 

 heating equipment,'' after ``large commercial 

 package air conditioning and heating equipment,''; 

 and

 (B) by adding at the end the following:

 ``(6)(A)(i) In the case of commercial refrigerators, freezers, and 

refrigerator-freezers, the test procedures shall be--

 ``(I) the test procedures determined by the Secretary to be 

 generally accepted industry testing procedures; or

 ``(II) rating procedures developed or recognized by the 

 ASHRAE or by the American National Standards Institute.

 ``(ii) In the case of self-contained refrigerators, freezers, and 

refrigerator-freezers to which standards are applicable under paragraphs 

(2) and (3) of section 342(c), the initial test procedures shall be the 

ASHRAE 117 test procedure that is in effect on January 1, 2005.

 ``(B)(i) In the case of commercial refrigerators, freezers, and 

refrigerator-freezers with doors covered by the standards adopted in 

February 2002, by the California Energy Commission, the rating 

temperatures shall be the integrated average temperature of 38 degrees F 

( <plus-minus> 2 degrees F) for refrigerator compartments and 0 degrees 

F ( <plus-minus> 2 degrees F) for freezer compartments.

 ``(C) <<NOTE: Regulations.>> The Secretary shall issue a rule in 

accordance with paragraphs (2) and (3) to establish the appropriate 

rating temperatures for the other products for which standards will be 

established under section 342(c)(4).

 ``(D) In establishing the appropriate test temperatures under this 

subparagraph, the Secretary shall follow the procedures and meet the 

requirements under section 323(e).

 ``(E)(i) <<NOTE: Deadline. Regulations.>> Not later than 180 days 

after the publication of the new ASHRAE 117 test procedure, if the 

ASHRAE 117 test procedure for commercial refrigerators, freezers, and 

refrigerator-freezers is amended, the Secretary shall, by rule, amend 

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the test procedure for the product as necessary to ensure that the test 

procedure is consistent with the amended ASHRAE 117 test procedure, 

unless the Secretary makes a determination, by rule, and supported by 

clear and convincing evidence, that to do so would not meet the 

requirements for test procedures under paragraphs (2) and (3).

 ``(ii) <<NOTE: Notice. Federal Register, publication.>> If the 

Secretary determines that 180 days is an insufficient period during 

which to review and adopt the amended test procedure or rating procedure 

under clause (i), the Secretary shall publish a notice in the Federal 

Register stating the intent of the Secretary to wait not longer than 1 

additional year before putting into effect an amended test procedure or 

rating procedure.

 ``(F)(i) <<NOTE: Regulations.>> If a test procedure other than the 

ASHRAE 117 test procedure is approved by the American National Standards 

Institute, the Secretary shall, by rule--

 ``(I) review the relative strengths and weaknesses of the 

 new test procedure relative to the ASHRAE 117 test procedure; 

 and

 ``(II) based on that review, adopt one new test procedure 

 for use in the standards program.

 ``(ii) <<NOTE: Applicability.>> If a new test procedure is adopted 

under clause (i)--

[[Page 119 STAT. 643]]

 ``(I) section 323(e) shall apply; and

 ``(II) subparagraph (B) shall apply to the adopted test 

 procedure.

 ``(7)(A) In the case of automatic commercial ice makers, the test 

procedures shall be the test procedures specified in Air-Conditioning 

and Refrigeration Institute Standard 810-2003, as in effect on January 

1, 2005.

 ``(B)(i) <<NOTE: Regulations. Federal Register, publication.>> If 

Air-Conditioning and Refrigeration Institute Standard 810-2003 is 

amended, the Secretary shall amend the test procedures established in 

subparagraph (A) as necessary to be consistent with the amended AirConditioning and Refrigeration Institute Standard, unless the Secretary 

determines, by rule, published in the Federal Register and supported by 

clear and convincing evidence, that to do so would not meet the 

requirements for test procedures under paragraphs (2) and (3).

 ``(ii) If the Secretary issues a rule under clause (i) containing a 

determination described in clause (ii), the rule may establish an 

amended test procedure for the product that meets the requirements of 

paragraphs (2) and (3).

 ``(C) The Secretary shall comply with section 323(e) in establishing 

any amended test procedure under this paragraph.

 ``(8) With respect to commercial clothes washers, the test 

procedures shall be the same as the test procedures established by the 

Secretary for residential clothes washers under section 325(g).''; and

 (2) in subsection (d)(1), by inserting ``very large 

 commercial package air conditioning and heating equipment, 

 commercial refrigerators, freezers, and refrigerator-freezers, 

 automatic commercial ice makers, commercial clothes washers,'' 

 after ``large commercial package air conditioning and heating 

 equipment,''.

 (g) Labeling.--Section 344(e) of the Energy Policy and Conservation 

Act (42 U.S.C. 6315(e)) is amended by inserting ``very large commercial 

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package air conditioning and heating equipment, commercial 

refrigerators, freezers, and refrigerator-freezers, automatic commercial 

ice makers, commercial clothes washers,'' after ``large commercial 

package air conditioning and heating equipment,'' each place it appears.

 (h) Administration, <<NOTE: Applicability.>> Penalties, Enforcement, 

and Preemption.--Section 345 of the Energy Policy and Conservation Act 

(42 U.S.C. 6316) is amended--

 (1) in subsection (a)--

 (A) in paragraph (7), by striking ``and'' at the 

 end;

 (B) in paragraph (8), by striking the period at the 

 end and inserting ``; and''; and

 (C) by adding at the end the following:

 ``(9) in the case of commercial clothes washers, section 

 327(b)(1) shall be applied as if the National Appliance Energy 

 Conservation Act of 1987 was the Energy Policy Act of 2005.'';

 (2) in the first sentence of subsection (b)(1), by striking 

 ``part B'' and inserting ``part A''; and

 (3) by adding at the end the following:

 ``(d)(1) Except as provided in paragraphs (2) and (3), section 327 

shall apply with respect to very large commercial package air 

conditioning and heating equipment to the same extent and in the same 

manner as section 327 applies under part A on the date of enactment of 

this subsection.

[[Page 119 STAT. 644]]

 ``(2) <<NOTE: Effective date.>> Any State or local standard issued 

before the date of enactment of this subsection shall not be preempted 

until the standards established under section 342(a)(9) take effect on 

January 1, 2010.

 ``(e)(1)(A) <<NOTE: Applicability.>> Subsections (a), (b), and (d) 

of section 326, subsections (m) through (s) of section 325, and sections 

328 through 336 shall apply with respect to commercial refrigerators, 

freezers, and refrigerator-freezers to the same extent and in the same 

manner as those provisions apply under part A.

 ``(B) In applying those provisions to commercial refrigerators, 

freezers, and refrigerator-freezers, paragraphs (1), (2), (3), and (4) 

of subsection (a) shall apply.

 ``(2)(A) Section 327 shall apply to commercial refrigerators, 

freezers, and refrigerator-freezers for which standards are established 

under paragraphs (2) and (3) of section 342(c) to the same extent and in 

the same manner as those provisions apply under part A on the date of 

enactment of this subsection, except that any State or local standard 

issued before the date of enactment of this subsection shall not be 

preempted until the standards established under paragraphs (2) and (3) 

of section 342(c) take effect.

 ``(B) In applying section 327 in accordance with subparagraph (A), 

paragraphs (1), (2), and (3) of subsection (a) shall apply.

 ``(3)(A) Section 327 shall apply to commercial refrigerators, 

freezers, and refrigerator-freezers for which standards are established 

under section 342(c)(4) to the same extent and in the same manner as the 

provisions apply under part A on the date of publication of the final 

rule by the Secretary, except that any State or local standard issued 

before the date of publication of the final rule by the Secretary shall 

not be preempted until the standards take effect.

 ``(B) In applying section 327 in accordance with subparagraph (A), 

paragraphs (1), (2), and (3) of subsection (a) shall apply.

 ``(4)(A) If the Secretary does not issue a final rule for a specific 

type of commercial refrigerator, freezer, or refrigerator-freezer within 

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the time frame specified in section 342(c)(5), subsections (b) and (c) 

of section 327 shall not apply to that specific type of refrigerator, 

freezer, or refrigerator-freezer for the period beginning on the date 

that is 2 years after the scheduled date for a final rule and ending on 

the date on which the Secretary publishes a final rule covering the 

specific type of refrigerator, freezer, or refrigerator-freezer.

 ``(B) Any State or local standard issued before the date of 

publication of the final rule shall not be preempted until the final 

rule takes effect.

 ``(5)(A) <<NOTE: Certification.>> In the case of any commercial 

refrigerator, freezer, or refrigerator-freezer to which standards are 

applicable under paragraphs (2) and (3) of section 342(c), the Secretary 

shall require manufacturers to certify, through an independent, 

nationally recognized testing or certification program, that the 

commercial refrigerator, freezer, or refrigerator-freezer meets the 

applicable standard.

 ``(B) The Secretary shall, to the maximum extent practicable, 

encourage the establishment of at least 2 independent testing and 

certification programs.

 ``(C) <<NOTE: Records.>> As part of certification, information on 

equipment energy use and interior volume shall be made available to the 

Secretary.

 ``(f)(1)(A)(i) <<NOTE: Applicability.>> Except as provided in clause 

(ii), section 327 shall apply to automatic commercial ice makers for 

which standards

[[Page 119 STAT. 645]]

have been established under section 342(d)(1) to the same extent and in 

the same manner as the section applies under part A on the date of 

enactment of this subsection.

 ``(ii) Any State standard issued before the date of enactment of 

this subsection shall not be preempted until the standards established 

under section 342(d)(1) take effect.

 ``(B) In applying section 327 to the equipment under subparagraph 

(A), paragraphs (1), (2), and (3) of subsection (a) shall apply.

 ``(2)(A)(i) Except as provided in clause (ii), section 327 shall 

apply to automatic commercial ice makers for which standards have been 

established under section 342(d)(2) to the same extent and in the same 

manner as the section applies under part A on the date of publication of 

the final rule by the Secretary.

 ``(ii) Any State standard issued before the date of publication of 

the final rule by the Secretary shall not be preempted until the 

standards established under section 342(d)(2) take effect.

 ``(B) In applying section 327 in accordance with subparagraph (A), 

paragraphs (1), (2), and (3) of subsection (a) shall apply.

 ``(3)(A) If the Secretary does not issue a final rule for a specific 

type of automatic commercial ice maker within the time frame specified 

in section 342(d), subsections (b) and (c) of section 327 shall no 

longer apply to the specific type of automatic commercial ice maker for 

the period beginning on the day after the scheduled date for a final 

rule and ending on the date on which the Secretary publishes a final 

rule covering the specific type of automatic commercial ice maker.

 ``(B) Any State standard issued before the publication of the final 

rule shall not be preempted until the standards established in the final 

rule take effect.

 ``(4)(A) The Secretary shall monitor whether manufacturers are 

reducing harvest rates below tested values for the purpose of bringing 

non-complying equipment into compliance.

 ``(B) If the Secretary finds that there has been a substantial 

amount of manipulation with respect to harvest rates under subparagraph 

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(A), the Secretary shall take steps to minimize the manipulation, such 

as requiring harvest rates to be within 5 percent of tested values.

 ``(g)(1)(A) If the Secretary does not issue a final rule for 

commercial clothes washers within the timeframe specified in section 

342(e)(2), subsections (b) and (c) of section 327 shall not apply to 

commercial clothes washers for the period beginning on the day after the 

scheduled date for a final rule and ending on the date on which the 

Secretary publishes a final rule covering commercial clothes washers.

 ``(B) Any State or local standard issued before the date on which 

the Secretary publishes a final rule shall not be preempted until the 

standards established under section 342(e)(2) take effect.

 ``(2) The Secretary shall undertake an educational program to inform 

owners of laundromats, multifamily housing, and other sites where 

commercial clothes washers are located about the new standard, including 

impacts on washer purchase costs and options for recovering those costs 

through coin collection.''.

SEC. 137. ENERGY LABELING.

 (a) Rulemaking on Effectiveness of Consumer Product Labeling.--

Section 324(a)(2) of the Energy Policy and Conservation

[[Page 119 STAT. 646]]

Act (42 U.S.C. 6294(a)(2)) is amended by adding at the end the 

following:

 ``(F)(i) <<NOTE: Deadlines.>> Not later than 90 days after the date 

of enactment of this subparagraph, the Commission shall initiate a 

rulemaking to consider--

 ``(I) the effectiveness of the consumer products labeling 

 program in assisting consumers in making purchasing decisions 

 and improving energy efficiency; and

 ``(II) changes to the labeling rules (including categorical 

 labeling) that would improve the effectiveness of consumer 

 product labels.

 ``(ii) Not later than 2 years after the date of enactment of this 

subparagraph, the Commission shall complete the rulemaking initiated 

under clause (i).

 ``(G)(i) <<NOTE: Deadline.>> Not later than 18 months after the date 

of enactment of this subparagraph, the Commission shall issue by rule, 

in accordance with this section, labeling requirements for the 

electricity used by ceiling fans to circulate air in a room.

 ``(ii) <<NOTE: Applicability.>> The rule issued under clause (i) 

shall apply to products manufactured after the later of--

 ``(I) January 1, 2009; or

 ``(II) the date that is 60 days after the final rule is 

 issued.''.

 (b) Rulemaking on Labeling for Additional Products.--Section 324(a) 

of the Energy Policy and Conservation Act (42 U.S.C. 6294(a)) is amended 

by adding at the end the following:

 ``(5)(A) For covered products described in subsections (u) through 

(ff) of section 325, after a test procedure has been prescribed under 

section 323, the Secretary or the Commission, as appropriate, may 

prescribe, by rule, under this section labeling requirements for the 

products.

 ``(B) In the case of products to which TP-1 standards under section 

325(y) apply, labeling requirements shall be based on the `Standard for 

the Labeling of Distribution Transformer Efficiency' prescribed by the 

National Electrical Manufacturers Association (NEMA TP-3) as in effect 

on the date of enactment of this paragraph.

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 ``(C) In the case of dehumidifiers covered under section 325(dd), 

the Commission shall not require an `Energy Guide' label.''.

SEC. 138. INTERMITTENT ESCALATOR STUDY.

 (a) In General.--The Administrator of General Services shall conduct 

a study on the advantages and disadvantages of employing intermittent 

escalators in the United States.

 (b) Contents.--Such study shall include an analysis of--

 (1) the energy end-cost savings derived from the use of 

 intermittent escalators;

 (2) the cost savings derived from reduced maintenance 

 requirements; and

 (3) such other issues as the Administrator considers 

 appropriate.

 (c) Report to Congress.--Not later than 1 year after the date of 

enactment of this Act, the Administrator shall transmit to Congress a 

report on the results of the study.

 (d) Definition.--For purposes of this section, the term 

``intermittent escalator'' means an escalator that remains in a 

stationary

[[Page 119 STAT. 647]]

position until it automatically operates at the approach of a passenger, 

returning to a stationary position after the passenger completes 

passage.

SEC. 139. ENERGY EFFICIENT ELECTRIC AND NATURAL GAS UTILITIES STUDY.

 (a) In General.--Not <<NOTE: Deadline.>> later than 1 year after the 

date of enactment of this Act, the Secretary, in consultation with the 

National Association of Regulatory Utility Commissioners and the 

National Association of State Energy Officials, shall conduct a study of 

State and regional policies that promote cost-effective programs to 

reduce energy consumption (including energy efficiency programs) that 

are carried out by--

 (1) utilities that are subject to State regulation; and

 (2) nonregulated utilities.

 (b) Consideration.--In conducting the study under subsection (a), 

the Secretary shall take into consideration--

 (1) performance standards for achieving energy use and 

 demand reduction targets;

 (2) funding sources, including rate surcharges;

 (3) infrastructure planning approaches (including energy 

 efficiency programs) and infrastructure improvements;

 (4) the costs and benefits of consumer education programs 

 conducted by State and local governments and local utilities to 

 increase consumer awareness of energy efficiency technologies 

 and measures; and

 (5) methods of--

 (A) removing disincentives for utilities to 

 implement energy efficiency programs;

 (B) encouraging utilities to undertake voluntary 

 energy efficiency programs; and

 (C) ensuring appropriate returns on energy 

 efficiency programs.

 (c) Report.--Not later than 1 year after the date of enactment of 

this Act, the Secretary shall submit to Congress a report that 

includes--

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 (1) the findings of the study; and

 (2) any recommendations of the Secretary, including 

 recommendations on model policies to promote energy efficiency 

 programs.

SEC. 140. <<NOTE: 42 USC 15833.>> ENERGY EFFICIENCY PILOT PROGRAM.

 (a) In General.--The Secretary shall establish a pilot program under 

which the Secretary provides financial assistance to at least 3, but not 

more than 7, States to carry out pilot projects in the States for--

 (1) planning and adopting statewide programs that encourage, 

 for each year in which the pilot project is carried out--

 (A) energy efficiency; and

 (B) reduction of consumption of electricity or 

 natural gas in the State by at least 0.75 percent, as 

 compared to a baseline determined by the Secretary for 

 the period preceding the implementation of the program; 

 or

 (2) for any State that has adopted a statewide program as of 

 the date of enactment of this Act, activities that reduce energy 

 consumption in the State by expanding and improving the program.

[[Page 119 STAT. 648]]

 (b) Verification.--A State that receives financial assistance under 

subsection (a)(1) shall submit to the Secretary independent verification 

of any energy savings achieved through the statewide program.

 (c) Authorization of Appropriations.--There is authorized to be 

appropriated to carry out this section $5,000,000 for each of fiscal 

years 2006 through 2010, to remain available until expended.

SEC. 141. <<NOTE: 42 USC 15834.>> REPORT ON FAILURE TO COMPLY WITH 

 DEADLINES FOR NEW OR REVISED ENERGY CONSERVATION STANDARDS.

 (a) Initial Report.--The Secretary shall submit a report to Congress 

regarding each new or revised energy conservation or water use standard 

which the Secretary has failed to issue in conformance with the 

deadlines established in the Energy Policy and Conservation Act. Such 

report shall state the reasons why the Secretary has failed to comply 

with the deadline for issuances of the new or revised standard and set 

forth the Secretary's plan for expeditiously prescribing such new or 

revised standard. The Secretary's initial report shall be submitted not 

later than 6 months following enactment of this Act and subsequent 

reports shall be submitted whenever the Secretary determines that 

additional deadlines for issuance of new or revised standards have been 

missed.

 (b) Implementation Report.--Every 6 months following the submission 

of a report under subsection (a) until the adoption of a new or revised 

standard described in such report, the Secretary shall submit to the 

Congress an implementation report describing the Secretary's progress in 

implementing the Secretary's plan or the issuance of the new or revised 

standard.

 Subtitle D--Public Housing

SEC. 151. PUBLIC HOUSING CAPITAL FUND.

 Section 9 of the United States Housing Act of 1937 (42 U.S.C. 1437g) 

is amended--

 (1) in subsection (d)(1)--

 (A) in subparagraph (I), by striking ``and'' at the 

 end;

 (B) in subparagraph (J), by striking the period at 

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 the end and inserting a semicolon; and

 (C) by adding at the end the following new 

 subparagraphs:

 ``(K) improvement of energy and water-use efficiency 

 by installing fixtures and fittings that conform to the 

 American Society of Mechanical Engineers/American 

 National Standards Institute standards A112.19.2-1998 

 and A112.18.1-2000, or any revision thereto, applicable 

 at the time of installation, and by increasing energy 

 efficiency and water conservation by such other means as 

 the Secretary determines are appropriate; and

 ``(L) integrated utility management and capital 

 planning to maximize energy conservation and efficiency 

 measures.''; and

 (2) in subsection (e)(2)(C)--

 (A) by striking ``The'' and inserting the following:

 ``(i) In general.--The''; and

 (B) by adding at the end the following:

[[Page 119 STAT. 649]]

 ``(ii) Third party contracts.--Contracts 

 described in clause (i) may include contracts for 

 equipment conversions to less costly utility 

 sources, projects with resident-paid utilities, 

 and adjustments to frozen base year consumption, 

 including systems repaired to meet applicable 

 building and safety codes and adjustments for 

 occupancy rates increased by rehabilitation.

 ``(iii) Term of contract.--The total term of a 

 contract described in clause (i) shall not exceed 

 20 years to allow longer payback periods for 

 retrofits, including windows, heating system 

 replacements, wall insulation, site-based 

 generation, advanced energy savings technologies, 

 including renewable energy generation, and other 

 such retrofits.''.

SEC. 152. <<NOTE: 42 USC 15841.>> ENERGY-EFFICIENT APPLIANCES.

 In purchasing appliances, a public housing agency shall purchase 

energy-efficient appliances that are Energy Star products or FEMPdesignated products, as such terms are defined in section 553 of the 

National Energy Conservation Policy Act, unless the purchase of energyefficient appliances is not cost-effective to the agency.

SEC. 153. ENERGY EFFICIENCY STANDARDS.

 Section 109 of the Cranston-Gonzalez National Affordable Housing Act 

(42 U.S.C. 12709) is amended--

 (1) in subsection (a)--

 (A) in paragraph (1)--

 (i) by striking ``1 year after the date of the 

 enactment of the Energy Policy Act of 1992'' and 

 inserting ``September 30, 2006'';

 (ii) in subparagraph (A), by striking ``and'' 

 at the end;

 (iii) in subparagraph (B), by striking the 

 period at the end and inserting ``; and''; and

 (iv) by adding at the end the following:

 ``(C) rehabilitation and new construction of public 

 and assisted housing funded by HOPE VI revitalization 

 grants under section 24 of the United States Housing Act 

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 of 1937 (42 U.S.C. 1437v), where such standards are 

 determined to be cost effective by the Secretary of 

 Housing and Urban Development.''; and

 (B) in paragraph (2), by inserting ``, and, with 

 respect to rehabilitation and new construction of public 

 and assisted housing funded by HOPE VI revitalization 

 grants under section 24 of the United States Housing Act 

 of 1937 (42 U.S.C. 1437v), the 2003 International Energy 

 Conservation Code'' after ``90.1-1989')'';

 (2) in subsection (b)--

 (A) by striking ``within 1 year after the date of 

 the enactment of the Energy Policy Act of 1992'' and 

 inserting ``by September 30, 2006''; and

 (B) by inserting ``, and, with respect to 

 rehabilitation and new construction of public and 

 assisted housing funded by HOPE VI revitalization grants 

 under section 24 of the United States Housing Act of 

 1937 (42 U.S.C. 1437v), the 2003 International Energy 

 Conservation Code'' before the period at the end; and

[[Page 119 STAT. 650]]

 (3) in subsection (c)--

 (A) in the heading, by inserting ``and the 

 International Energy Conservation Code'' after ``Model 

 Energy Code''; and

 (B) by inserting ``, or, with respect to 

 rehabilitation and new construction of public and 

 assisted housing funded by HOPE VI revitalization grants 

 under section 24 of the United States Housing Act of 

 1937 (42 U.S.C. 1437v), the 2003 International Energy 

 Conservation Code'' after ``1989''.

SEC. 154. <<NOTE: 42 USC 15842.>> ENERGY STRATEGY FOR HUD.

 The Secretary of Housing and Urban Development shall develop and 

implement an integrated strategy to reduce utility expenses through 

cost-effective energy conservation and efficiency measures and energy 

efficient design and construction of public and assisted housing. The 

energy strategy shall include the development of energy reduction goals 

and incentives for public housing agencies. 

The <<NOTE: Reports. Deadlines.>> Secretary shall submit a report to 

Congress, not later than 1 year after the date of the enactment of this 

Act, on the energy strategy and the actions taken by the Department of 

Housing and Urban Development to monitor the energy usage of public 

housing agencies and shall submit an update every 2 years thereafter on 

progress in implementing the strategy.

 TITLE II--RENEWABLE ENERGY

 Subtitle A--General Provisions

SEC. 201. <<NOTE: 42 USC 15851.>> ASSESSMENT OF RENEWABLE ENERGY 

 RESOURCES.

 (a) Resource Assessment.--Not <<NOTE: Deadlines.>> later than 6 

months after the date of enactment of this Act, and each year 

thereafter, the Secretary shall review the available assessments of 

renewable energy resources within the United States, including solar, 

wind, biomass, ocean (including tidal, wave, current, and thermal), 

geothermal, and hydroelectric energy resources, and undertake new 

assessments as necessary, taking into account changes in market 

conditions, available technologies, and other relevant factors.

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 (b) Contents of Reports.--Not later than 1 year after the date of 

enactment of this Act, and each year thereafter, the Secretary shall 

publish a report based on the assessment under subsection (a). The 

report shall contain--

 (1) a detailed inventory describing the available amount and 

 characteristics of the renewable energy resources; and

 (2) such other information as the Secretary believes would 

 be useful in developing such renewable energy resources, 

 including descriptions of surrounding terrain, population and 

 load centers, nearby energy infrastructure, location of energy 

 and water resources, and available estimates of the costs needed 

 to develop each resource, together with an identification of any 

 barriers to providing adequate transmission for remote sources 

 of renewable energy resources to current and emerging markets, 

 recommendations for removing or addressing such barriers, and 

 ways to provide access to the grid that do not unfairly 

 disadvantage renewable or other energy producers.

[[Page 119 STAT. 651]]

 (c) Authorization of Appropriations.--For <<NOTE: 42 USC 13311 

note.>> the purposes of this section, there are authorized to be 

appropriated to the Secretary $10,000,000 for each of fiscal years 2006 

through 2010.

SEC. 202. RENEWABLE ENERGY PRODUCTION INCENTIVE.

 (a) Incentive Payments.--Section 1212(a) of the Energy Policy Act of 

1992 (42 U.S.C. 13317(a)) is amended--

 (1) by striking the last sentence;

 (2) by designating the first, second, and third sentences as 

 paragraphs (1), (2), and (3), respectively;

 (3) in paragraph (3) (as so designated), by striking ``and 

 which satisfies'' and all that follows through ``deems 

 necessary''; and

 (4) by adding at the end the following:

 ``(4)(A) Subject to subparagraph (B), if there are insufficient 

appropriations to make full payments for electric production from all 

qualified renewable energy facilities for a fiscal year, the Secretary 

shall assign--

 ``(i) 60 percent of appropriated funds for the fiscal year 

 to facilities that use solar, wind, ocean (including tidal, 

 wave, current, and thermal), geothermal, or closed-loop 

 (dedicated energy crops) biomass technologies to generate 

 electricity; and

 ``(ii) 40 percent of appropriated funds for the fiscal year 

 to other projects.

 ``(B) After submitting to Congress an explanation of the reasons for 

the alteration, the Secretary may alter the percentage requirements of 

subparagraph (A).''.

 (b) Qualified Renewable Energy Facility.--Section 1212(b) of the 

Energy Policy Act of 1992 (42 U.S.C. 13317(b)) is amended--

 (1) by striking ``a State or any political'' and all that 

 follows through ``nonprofit electrical cooperative'' and 

 inserting ``a not-for-profit electric cooperative, a public 

 utility described in section 115 of the Internal Revenue Code of 

 1986, a State, Commonwealth, territory, or possession of the 

 United States, or the District of Columbia, or a political 

 subdivision thereof, an Indian tribal government or subdivision 

 thereof, or a Native Corporation (as defined in section 3 of the 

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 Alaska Native Claims Settlement Act (43 U.S.C. 1602)),''; and

 (2) by inserting ``landfill gas, livestock methane, ocean 

 (including tidal, wave, current, and thermal),'' after ``wind, 

 biomass,''.

 (c) Eligibility Window.--Section 1212(c) of the Energy Policy Act of 

1992 (42 U.S.C. 13317(c)) is amended by striking ``during the 10-fiscal 

year period beginning with the first full fiscal year occurring after 

the enactment of this section'' and inserting ``before October 1, 

2016''.

 (d) Payment Period.--Section 1212(d) of the Energy Policy Act of 

1992 (42 U.S.C. 13317(d)) is amended in the second sentence by inserting 

``, or in which the Secretary determines that all necessary Federal and 

State authorizations have been obtained to begin construction of the 

facility'' after ``eligible for such payments''.

 (e) Amount of Payment.--Section 1212(e)(1) of the Energy Policy Act 

of 1992 (42 U.S.C. 13317(e)(1)) is amended in the first sentence by 

inserting ``landfill gas, livestock methane, ocean (including tidal, 

wave, current, and thermal),'' after ``wind, biomass,''.

[[Page 119 STAT. 652]]

 (f) Termination of Authority.--Section 1212(f) of the Energy Policy 

Act of 1992 (42 U.S.C. 13317(f)) is amended by striking ``the expiration 

of'' and all that follows through ``of this section'' and inserting 

``September 30, 2026''.

 (g) Authorization of Appropriations.--Section 1212 of the Energy 

Policy Act of 1992 (42 U.S.C. 13317) is amended by striking subsection 

(g) and inserting the following:

 ``(g) Authorization of Appropriations.--There are authorized to be 

appropriated such sums as are necessary to carry out this section for 

each of fiscal years 2006 through 2026, to remain available until 

expended.''.

SEC. 203. <<NOTE: 42 USC 15852.>> FEDERAL PURCHASE REQUIREMENT.

 (a) Requirement.--The <<NOTE: President.>> President, acting through 

the Secretary, shall seek to ensure that, to the extent economically 

feasible and technically practicable, of the total amount of electric 

energy the Federal Government consumes during any fiscal year, the 

following amounts shall be renewable energy:

 (1) Not less than 3 percent in fiscal years 2007 through 

 2009.

 (2) Not less than 5 percent in fiscal years 2010 through 

 2012.

 (3) Not less than 7.5 percent in fiscal year 2013 and each 

 fiscal year thereafter.

 (b) Definitions.--In this section:

 (1) Biomass.--The term ``biomass'' means any lignin waste 

 material that is segregated from other waste materials and is 

 determined to be nonhazardous by the Administrator of the 

 Environmental Protection Agency and any solid, nonhazardous, 

 cellulosic material that is derived from--

 (A) any of the following forest-related resources: 

 mill residues, precommercial thinnings, slash, and 

 brush, or nonmerchantable material;

 (B) solid wood waste materials, including waste 

 pallets, crates, dunnage, manufacturing and construction 

 wood wastes (other than pressure-treated, chemically-

 treated, or painted wood wastes), and landscape or 

 right-of-way tree trimmings, but not including municipal 

 solid waste (garbage), gas derived from the 

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 biodegradation of solid waste, or paper that is commonly 

 recycled;

 (C) agriculture wastes, including orchard tree 

 crops, vineyard, grain, legumes, sugar, and other crop 

 by-products or residues, and livestock waste nutrients; 

 or

 (D) a plant that is grown exclusively as a fuel for 

 the production of electricity.

 (2) Renewable energy.--The term ``renewable energy'' means 

 electric energy generated from solar, wind, biomass, landfill 

 gas, ocean (including tidal, wave, current, and thermal), 

 geothermal, municipal solid waste, or new hydroelectric 

 generation capacity achieved from increased efficiency or 

 additions of new capacity at an existing hydroelectric project.

 (c) Calculation.--For purposes of determining compliance with the 

requirement of this section, the amount of renewable energy shall be 

doubled if--

 (1) the renewable energy is produced and used on-site at a 

 Federal facility;

[[Page 119 STAT. 653]]

 (2) the renewable energy is produced on Federal lands and 

 used at a Federal facility; or

 (3) the renewable energy is produced on Indian land as 

 defined in title XXVI of the Energy Policy Act of 1992 (25 

 U.S.C. 3501 et seq.) and used at a Federal facility.

 (d) Report.--Not later than April 15, 2007, and every 2 years 

thereafter, the Secretary shall provide a report to Congress on the 

progress of the Federal Government in meeting the goals established by 

this section.

SEC. 204. USE OF PHOTOVOLTAIC ENERGY IN PUBLIC BUILDINGS.

 (a) In General.--Subchapter VI of chapter 31 of title 40, United 

States Code, is amended by adding at the end the following:

``Sec. 3177. Use of photovoltaic energy in public buildings

 ``(a) Photovoltaic Energy Commercialization Program.--

 ``(1) In general.--The Administrator of General Services may 

 establish a photovoltaic energy commercialization program for 

 the procurement and installation of photovoltaic solar electric 

 systems for electric production in new and existing public 

 buildings.

 ``(2) Purposes.--The purposes of the program shall be to 

 accomplish the following:

 ``(A) To accelerate the growth of a commercially 

 viable photovoltaic industry to make this energy system 

 available to the general public as an option which can 

 reduce the national consumption of fossil fuel.

 ``(B) To reduce the fossil fuel consumption and 

 costs of the Federal Government.

 ``(C) To attain the goal of installing solar energy 

 systems in 20,000 Federal buildings by 2010, as 

 contained in the Federal Government's Million Solar Roof 

 Initiative of 1997.

 ``(D) To stimulate the general use within the 

 Federal Government of life-cycle costing and innovative 

 procurement methods.

 ``(E) To develop program performance data to support 

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 policy decisions on future incentive programs with 

 respect to energy.

 ``(3) Acquisition of photovoltaic solar electric systems.--

 ``(A) In general.--The program shall provide for the 

 acquisition of photovoltaic solar electric systems and 

 associated storage capability for use in public 

 buildings.

 ``(B) Acquisition levels.--The acquisition of 

 photovoltaic electric systems shall be at a level 

 substantial enough to allow use of low-cost production 

 techniques with at least 150 megawatts (peak) cumulative 

 acquired during the 5 years of the program.

 ``(4) Administration.--The Administrator shall administer 

 the program and shall--

 ``(A) issue such rules and regulations as may be 

 appropriate to monitor and assess the performance and 

 operation of photovoltaic solar electric systems 

 installed pursuant to this subsection;

 ``(B) <<NOTE: Reports.>> develop innovative 

 procurement strategies for the acquisition of such 

 systems; and

[[Page 119 STAT. 654]]

 ``(C) transmit to Congress an annual report on the 

 results of the program.

 ``(b) Photovoltaic Systems Evaluation Program.--

 ``(1) In general.--Not <<NOTE: Deadline.>> later than 60 

 days after the date of enactment of this section, the 

 Administrator shall establish a photovoltaic solar energy 

 systems evaluation program to evaluate such photovoltaic solar 

 energy systems as are required in public buildings.

 ``(2) Program requirement.--In evaluating photovoltaic solar 

 energy systems under the program, the Administrator shall ensure 

 that such systems reflect the most advanced technology.

 ``(c) Authorization of Appropriations.--

 ``(1) Photovoltaic energy commercialization program.--There 

 are authorized to be appropriated to carry out subsection (a) 

 $50,000,000 for each of fiscal years 2006 through 2010. Such 

 sums shall remain available until expended.

 ``(2) Photovoltaic systems evaluation program.--There are 

 authorized to be appropriated to carry out subsection (b) 

 $10,000,000 for each of fiscal years 2006 through 2010. Such 

 sums shall remain available until expended.''.

 (b) Conforming Amendment.--The table of sections for the National 

Energy Conservation Policy Act is amended by inserting after the item 

relating to section 569 the following:

``Sec. 570. Use of photovoltaic energy in public buildings.''.

SEC. 205. BIOBASED PRODUCTS.

 Section 9002(c)(1) of the Farm Security and Rural Investment Act of 

2002 (7 U.S.C. 8102(c)(1)) is amended by inserting ``or such items that 

comply with the regulations issued under section 103 of Public Law 100-

556 (42 U.S.C. 6914b-1)'' after ``practicable''.

SEC. 206. RENEWABLE ENERGY SECURITY.

 (a) Weatherization Assistance.--Section 415(c) of the Energy 

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Conservation and Production Act (42 U.S.C. 6865(c)) is amended--

 (1) in paragraph (1), by striking ``in paragraph (3)'' and 

 inserting ``in paragraphs (3) and (4)'';

 (2) in paragraph (3), by striking ``$2,500 per dwelling unit 

 average provided in paragraph (1)'' and inserting ``dwelling 

 unit averages provided in paragraphs (1) and (4)''; and

 (3) by adding at the end the following new paragraphs:

 ``(4) The expenditure of financial assistance provided under this 

part for labor, weatherization materials, and related matters for a 

renewable energy system shall not exceed an average of $3,000 per 

dwelling unit.

 ``(5)(A) <<NOTE: Regulations.>> The Secretary shall by regulations--

 ``(i) establish the criteria which are to be used in 

 prescribing performance and quality standards under paragraph 

 (6)(A)(ii) or in specifying any form of renewable energy under 

 paragraph (6)(A)(i)(I); and

 ``(ii) establish a procedure under which a manufacturer of 

 an item may request the Secretary to certify that the item will 

 be treated, for purposes of this paragraph, as a renewable 

 energy system.

 ``(B) The Secretary shall make a final determination with respect to 

any request filed under subparagraph (A)(ii) within 1

[[Page 119 STAT. 655]]

year after the filing of the request, together with any information 

required to be filed with such request under subparagraph (A)(ii).

 ``(C) <<NOTE: Reports.>> Each month the Secretary shall publish a 

report of any request under subparagraph (A)(ii) which has been denied 

during the preceding month and the reasons for the denial.

 ``(D) The Secretary shall not specify any form of renewable energy 

under paragraph (6)(A)(i)(I) unless the Secretary determines that--

 ``(i) there will be a reduction in oil or natural gas 

 consumption as a result of such specification;

 ``(ii) such specification will not result in an increased 

 use of any item which is known to be, or reasonably suspected to 

 be, environmentally hazardous or a threat to public health or 

 safety; and

 ``(iii) available Federal subsidies do not make such 

 specification unnecessary or inappropriate (in the light of the 

 most advantageous allocation of economic resources).

 ``(6) In this subsection--

 ``(A) the term `renewable energy system' means a system 

 which--

 ``(i) when installed in connection with a dwelling, 

 transmits or uses--

 ``(I) solar energy, energy derived from the 

 geothermal deposits, energy derived from biomass, 

 or any other form of renewable energy which the 

 Secretary specifies by regulations, for the 

 purpose of heating or cooling such dwelling or 

 providing hot water or electricity for use within 

 such dwelling; or

 ``(II) wind energy for nonbusiness residential 

 purposes;

 ``(ii) meets the performance and quality standards 

 (if any) which have been prescribed by the Secretary by 

 regulations;

 ``(iii) in the case of a combustion rated system, 

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 has a thermal efficiency rating of at least 75 percent; 

 and

 ``(iv) in the case of a solar system, has a thermal 

 efficiency rating of at least 15 percent; and

 ``(B) the term `biomass' means any organic matter that is 

 available on a renewable or recurring basis, including 

 agricultural crops and trees, wood and wood wastes and residues, 

 plants (including aquatic plants), grasses, residues, fibers, 

 and animal wastes, municipal wastes, and other waste 

 materials.''.

 (b) District Heating and Cooling Programs.--Section 172 of the 

Energy Policy Act of 1992 (42 U.S.C. 13451 note) is amended--

 (1) in subsection (a)--

 (A) by striking ``and'' at the end of paragraph (3);

 (B) by striking the period at the end of paragraph 

 (4) and inserting ``; and''; and

 (C) by adding at the end the following new 

 paragraph:

 ``(5) evaluate the use of renewable energy systems (as such 

 term is defined in section 415(c) of the Energy Conservation and 

 Production Act (42 U.S.C. 6865(c))) in residential buildings.''; 

 and

 (2) in subsection (b), by striking ``this Act'' and 

 inserting ``the Energy Policy Act of 2005''.

 (c) Rebate <<NOTE: 42 USC 15853.>> Program.--

[[Page 119 STAT. 656]]

 (1) Establishment.--The Secretary shall establish a program 

 providing rebates for consumers for expenditures made for the 

 installation of a renewable energy system in connection with a 

 dwelling unit or small business.

 (2) Amount of rebate.--Rebates provided under the program 

 established under paragraph (1) shall be in an amount not to 

 exceed the lesser of--

 (A) 25 percent of the expenditures described in 

 paragraph (1) made by the consumer; or

 (B) $3,000.

 (3) Definition.--For purposes of this subsection, the term 

 ``renewable energy system'' has the meaning given that term in 

 section 415(c)(6)(A) of the Energy Conservation and Production 

 Act (42 U.S.C. 6865(c)(6)(A)), as added by subsection (a)(3) of 

 this section.

 (4) Authorization of appropriations.--There are authorized 

 to be appropriated to the Secretary for carrying out this 

 subsection, to remain available until expended--

 (A) $150,000,000 for fiscal year 2006;

 (B) $150,000,000 for fiscal year 2007;

 (C) $200,000,000 for fiscal year 2008;

 (D) $250,000,000 for fiscal year 2009; and

 (E) $250,000,000 for fiscal year 2010.

 (d) Renewable Fuel Inventory.--

Not <<NOTE: Deadline. Reports.>> later than 180 days after the date of 

enactment of this Act, the Secretary shall transmit to Congress a report 

containing--

 (1) an inventory of renewable fuels available for consumers; 

 and

 (2) a projection of future inventories of renewable fuels 

 based on the incentives provided in this section.

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SEC. 207. INSTALLATION OF PHOTOVOLTAIC SYSTEM.

 There <<NOTE: Appropriation authorization.>> is authorized to be 

appropriated to the General Services Administration to install a 

photovoltaic system, as set forth in the Sun Wall Design Project, for 

the headquarters building of the Department of Energy located at 1000 

Independence Avenue Southwest in the District of Columbia, commonly know 

as the Forrestal Building, $20,000,000 for fiscal year 2006. Such sums 

shall remain available until expended.

SEC. 208. <<NOTE: 42 USC 15854.>> SUGAR CANE ETHANOL PROGRAM.

 (a) Definition of Program.--In this section, the term ``program'' 

means the Sugar Cane Ethanol Program established by subsection (b).

 (b) Establishment.--There is established within the Environmental 

Protection Agency a program to be known as the ``Sugar Cane Ethanol 

Program''.

 (c) Project.--

 (1) In general.--Subject to the availability of 

 appropriations under subsection (d), in carrying out the 

 program, the Administrator of the Environmental Protection 

 Agency shall establish a project that is--

 (A) carried out in multiple States--

 (i) in each of which is produced cane sugar 

 that is eligible for loans under section 156 of 

 the Federal Agriculture Improvement and Reform Act 

 of 1996 (7 U.S.C. 7272), or a similar subsequent 

 authority; and

[[Page 119 STAT. 657]]

 (ii) at the option of each such State, that 

 have an incentive program that requires the use of 

 ethanol in the State; and

 (B) designed to study the production of ethanol from 

 cane sugar, sugarcane, and sugarcane byproducts.

 (2) Requirements.--A project described in paragraph (1) 

 shall--

 (A) be limited to sugar producers and the production 

 of ethanol in the States of Florida, Louisiana, Texas, 

 and Hawaii, divided equally among the States, to 

 demonstrate that the process may be applicable to cane 

 sugar, sugarcane, and sugarcane byproducts;

 (B) include information on the ways in which the 

 scale of production may be replicated once the sugar 

 cane industry has located sites for, and constructed, 

 ethanol production facilities; and

 (C) not last more than 3 years.

 (d) Authorization of Appropriations.--There is authorized to be 

appropriated to carry out this section $36,000,000, to remain available 

until expended.

SEC. 209. RURAL AND REMOTE COMMUNITY ELECTRIFICATION GRANTS.

 The Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2601 

et seq.) is amended in title VI by adding at the end the following:

``SEC. 609. <<NOTE: 7 USC 918c.>> RURAL AND REMOTE COMMUNITIES 

 ELECTRIFICATION GRANTS.

 ``(a) Definitions.--In this section:

 ``(1) The term `eligible grantee' means a local government 

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 or municipality, peoples' utility district, irrigation district, 

 and cooperative, nonprofit, or limited-dividend association in a 

 rural area.

 ``(2) The term `incremental hydropower' means additional 

 generation achieved from increased efficiency after January 1, 

 2005, at a hydroelectric dam that was placed in service before 

 January 1, 2005.

 ``(3) The term `renewable energy' means electricity 

 generated from--

 ``(A) a renewable energy source; or

 ``(B) hydrogen, other than hydrogen produced from a 

 fossil fuel, that is produced from a renewable energy 

 source.

 ``(4) The term `renewable energy source' means--

 ``(A) wind;

 ``(B) ocean waves;

 ``(C) biomass;

 ``(D) solar;

 ``(E) landfill gas;

 ``(F) incremental hydropower;

 ``(G) livestock methane; or

 ``(H) geothermal energy.

 ``(5) The term `rural area' means a city, town, or 

 unincorporated area that has a population of not more than 

 10,000 inhabitants.

 ``(b) Grants.--The Secretary, in consultation with the Secretary of 

Agriculture and the Secretary of the Interior, may provide grants under 

this section to eligible grantees for the purpose of--

[[Page 119 STAT. 658]]

 ``(1) increasing energy efficiency, siting or upgrading 

 transmission and distribution lines serving rural areas; or

 ``(2) providing or modernizing electric generation 

 facilities that serve rural areas.

 ``(c) Grant Administration.--(1) The Secretary shall make grants 

under this section based on a determination of cost-effectiveness and 

the most effective use of the funds to achieve the purposes described in 

subsection (b).

 ``(2) For each fiscal year, the Secretary shall allocate grant funds 

under this section equally between the purposes described in paragraphs 

(1) and (2) of subsection (b).

 ``(3) In making grants for the purposes described in subsection 

(b)(2), the Secretary shall give preference to renewable energy 

facilities.

 ``(d) Authorization of Appropriations.--There is authorized to be 

appropriated to the Secretary to carry out this section $20,000,000 for 

each of fiscal years 2006 through 2012.''.

SEC. 210. <<NOTE: 42 USC 15855.>> GRANTS TO IMPROVE THE COMMERCIAL VALUE 

 OF FOREST BIOMASS FOR ELECTRIC ENERGY, USEFUL HEAT, 

 TRANSPORTATION FUELS, AND OTHER COMMERCIAL PURPOSES.

 (a) Definitions.--In this section:

 (1) Biomass.--The term ``biomass'' means nonmerchantable 

 materials or precommercial thinnings that are byproducts of 

 preventive treatments, such as trees, wood, brush, thinnings, 

 chips, and slash, that are removed--

 (A) to reduce hazardous fuels;

 (B) to reduce or contain disease or insect 

 infestation; or

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 (C) to restore forest health.

 (2) Indian tribe.--The term ``Indian tribe'' has the meaning 

 given the term in section 4(e) of the Indian Self-Determination 

 and Education Assistance Act (25 U.S.C. 450b(e)).

 (3) Nonmerchantable.--For purposes of subsection (b), the 

 term ``nonmerchantable'' means that portion of the byproducts of 

 preventive treatments that would not otherwise be used for 

 higher value products.

 (4) Person.--The term ``person'' includes--

 (A) an individual;

 (B) a community (as determined by the Secretary 

 concerned);

 (C) an Indian tribe;

 (D) a small business or a corporation that is 

 incorporated in the United States; and

 (E) a nonprofit organization.

 (5) Preferred community.--The term ``preferred community'' 

 means--

 (A) any Indian tribe;

 (B) any town, township, municipality, or other 

 similar unit of local government (as determined by the 

 Secretary concerned) that--

 (i) has a population of not more than 50,000 

 individuals; and

 (ii) the Secretary concerned, in the sole 

 discretion of the Secretary concerned, determines 

 contains or is located near Federal or Indian 

 land, the condition of

[[Page 119 STAT. 659]]

 which is at significant risk of catastrophic 

 wildfire, disease, or insect infestation or which 

 suffers from disease or insect infestation; or

 (C) any county that--

 (i) is not contained within a metropolitan 

 statistical area; and

 (ii) the Secretary concerned, in the sole 

 discretion of the Secretary concerned, determines 

 contains or is located near Federal or Indian 

 land, the condition of which is at significant 

 risk of catastrophic wildfire, disease, or insect 

 infestation or which suffers from disease or 

 insect infestation.

 (6) Secretary concerned.--The term ``Secretary concerned'' 

 means the Secretary of Agriculture or the Secretary of the 

 Interior.

 (b) Biomass Commercial Use Grant Program.--

 (1) In general.--The Secretary concerned may make grants to 

 any person in a preferred community that owns or operates a 

 facility that uses biomass as a raw material to produce electric 

 energy, sensible heat, or transportation fuels to offset the 

 costs incurred to purchase biomass for use by such facility.

 (2) Grant amounts.--A grant under this subsection may not 

 exceed $20 per green ton of biomass delivered.

 (3) Monitoring of grant recipient activities.--As a 

 condition of a grant under this subsection, the grant recipient 

 shall keep such records as the Secretary concerned may require 

 to fully and correctly disclose the use of the grant funds and 

 all transactions involved in the purchase of biomass. Upon 

 notice by a representative of the Secretary concerned, the grant 

 recipient shall afford the representative reasonable access to 

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 the facility that purchases or uses biomass and an opportunity 

 to examine the inventory and records of the facility.

 (c) Improved Biomass Use Grant Program.--

 (1) In general.--The Secretary concerned may make grants to 

 persons to offset the cost of projects to develop or research 

 opportunities to improve the use of, or add value to, biomass. 

 In making such grants, the Secretary concerned shall give 

 preference to persons in preferred communities.

 (2) Selection.--The Secretary concerned shall select a grant 

 recipient under paragraph (1) after giving consideration to--

 (A) the anticipated public benefits of the project, 

 including the potential to develop thermal or electric 

 energy resources or affordable energy;

 (B) opportunities for the creation or expansion of 

 small businesses and micro-businesses;

 (C) the potential for new job creation;

 (D) the potential for the project to improve 

 efficiency or develop cleaner technologies for biomass 

 utilization; and

 (E) the potential for the project to reduce the 

 hazardous fuels from the areas in greatest need of 

 treatment.

 (3) Grant amount.--A grant under this subsection may not 

 exceed $500,000.

 (d) Authorization of Appropriations.--There are authorized to be 

appropriated $50,000,000 for each of the fiscal years 2006 through 2016 

to carry out this section.

[[Page 119 STAT. 660]]

 (e) Report.--Not later than October 1, 2010, the Secretary of 

Agriculture, in consultation with the Secretary of the Interior, shall 

submit to the Committee on Energy and Natural Resources and the 

Committee on Agriculture, Nutrition, and Forestry of the Senate, and the 

Committee on Resources, the Committee on Energy and Commerce, and the 

Committee on Agriculture of the House of Representatives, a report 

describing the results of the grant programs authorized by this section. 

The report shall include the following:

 (1) An identification of the size, type, and use of biomass 

 by persons that receive grants under this section.

 (2) The distance between the land from which the biomass was 

 removed and the facility that used the biomass.

 (3) The economic impacts, particularly new job creation, 

 resulting from the grants to and operation of the eligible 

 operations.

SEC. 211. SENSE OF CONGRESS REGARDING GENERATION CAPACITY OF ELECTRICITY 

 FROM RENEWABLE ENERGY RESOURCES ON PUBLIC LANDS.

 It is the sense of the Congress that the Secretary of the Interior 

should, before the end of the 10-year period beginning on the date of 

enactment of this Act, seek to have approved non-hydropower renewable 

energy projects located on the public lands with a generation capacity 

of at least 10,000 megawatts of electricity.

 Subtitle B--Geothermal <<NOTE: John Rishel Geothermal Steam Act 

Amendments of 2005.>> Energy

SEC. 221. <<NOTE: 30 USC 1001 note.>> SHORT TITLE.

 This subtitle may be cited as the ``John Rishel Geothermal Steam Act 

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Amendments of 2005''.

SEC. 222. COMPETITIVE LEASE SALE REQUIREMENTS.

 Section 4 of the Geothermal Steam Act of 1970 (30 U.S.C. 1003) is 

amended to read as follows:

``SEC. 4. LEASING PROCEDURES.

 ``(a) Nominations.--The Secretary shall accept nominations of land 

to be leased at any time from qualified companies and individuals under 

this Act.

 ``(b) Competitive Lease Sale Required.--

 ``(1) In general.--Except as otherwise specifically provided 

 by this Act, all land to be leased that is not subject to 

 leasing under subsection (c) shall be leased as provided in this 

 subsection to the highest responsible qualified bidder, as 

 determined by the Secretary.

 ``(2) Competitive lease sales.--The Secretary shall hold a 

 competitive lease sale at least once every 2 years for land in a 

 State that has nominations pending under subsection (a) if the 

 land is otherwise available for leasing.

 ``(3) Lands subject to mining claims.--Lands that are 

 subject to a mining claim for which a plan of operations has 

 been approved by the relevant Federal land management agency may 

 be available for noncompetitive leasing under this section to 

 the mining claim holder.

 ``(c) Noncompetitive Leasing.--The Secretary shall make available 

for a period of 2 years for noncompetitive leasing any

[[Page 119 STAT. 661]]

tract for which a competitive lease sale is held, but for which the 

Secretary does not receive any bids in a competitive lease sale.

 ``(d) Pending Lease Applications.--

 ``(1) In general.--It shall be a priority for the Secretary, 

 and for the Secretary of Agriculture with respect to National 

 Forest Systems land, to ensure timely completion of 

 administrative actions, including amendments to applicable 

 forest plans and resource management plans, necessary to process 

 applications for geothermal leasing pending on the date of 

 enactment of this subsection. All future forest plans and 

 resource management plans for areas with high geothermal 

 resource potential shall consider geothermal leasing and 

 development.

 ``(2) Administration.--An application described in paragraph 

 (1) and any lease issued pursuant to the application--

 ``(A) except as provided in subparagraph (B), shall 

 be subject to this section as in effect on the day 

 before the date of enactment of this paragraph; or

 ``(B) at the election of the applicant, shall be 

 subject to this section as in effect on the effective 

 date of this paragraph.

 ``(e) Leases Sold as a Block.--If information is available to the 

Secretary indicating a geothermal resource that could be produced as 1 

unit can reasonably be expected to underlie more than 1 parcel to be 

offered in a competitive lease sale, the parcels for such a resource may 

be offered for bidding as a block in the competitive lease sale.''.

SEC. 223. DIRECT USE.

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 (a) Fees for Direct Use.--Section 5 of the Geothermal Steam Act of 

1970 (30 U.S.C. 1004) is amended--

 (1) in subsection (c), by redesignating paragraphs (1) and 

 (2) as subparagraphs (A) and (B), respectively;

 (2) by redesignating subsections (a) through (d) as 

 paragraphs (1) through (4), respectively;

 (3) by inserting ``(a) In General.--'' after ``Sec. 5.''; 

 and

 (4) by adding at the end the following:

 ``(b) Direct Use.--

 ``(1) In general.--

 Notwithstanding <<NOTE: Fees.>> subsection (a)(1), the Secretary 

 shall establish a schedule of fees, in lieu of royalties for 

 geothermal resources, that a lessee or its affiliate--

 ``(A) uses for a purpose other than the commercial 

 generation of electricity; and

 ``(B) does not sell.

 ``(2) Schedule of fees.--The schedule of fees--

 ``(A) may be based on the quantity or thermal 

 content, or both, of geothermal resources used;

 ``(B) shall ensure a fair return to the United 

 States for use of the resource; and

 ``(C) shall encourage development of the resource.

 ``(3) State, tribal, or local governments.--If a State, 

 tribal, or local government is the lessee and uses geothermal 

 resources without sale and for public purposes other than 

 commercial generation of electricity, the Secretary shall charge 

 only a nominal fee for use of the resource.

[[Page 119 STAT. 662]]

 ``(4) Final regulation.--In issuing any final regulation 

 establishing a schedule of fees under this subsection, the 

 Secretary shall seek--

 ``(A) to provide lessees with a simplified 

 administrative system;

 ``(B) to facilitate development of direct use of 

 geothermal resources; and

 ``(C) to contribute to sustainable economic 

 development opportunities in the area.''.

 (b) Leasing for Direct Use.--Section 4 of the Geothermal Steam Act 

of 1970 (30 U.S.C. 1003) (as amended by section 222) is further amended 

by adding at the end the following:

 ``(f) Leasing for Direct Use of Geothermal Resources.--

Notwithstanding subsection (b), the Secretary may identify areas in 

which the land to be leased under this Act exclusively for direct use of 

geothermal resources, without sale for purposes other than commercial 

generation of electricity, may be leased to any qualified applicant that 

first applies for such a lease under regulations issued by the 

Secretary, if the Secretary--

 ``(1) <<NOTE: Notice. Deadline.>> publishes a notice of the 

 land proposed for leasing not later than 90 days before the date 

 of the issuance of the lease;

 ``(2) does not receive during the 90-day period beginning on 

 the date of the publication any nomination to include the land 

 concerned in the next competitive lease sale; and

 ``(3) determines there is no competitive interest in the 

 geothermal resources in the land to be leased.

 ``(g) Area Subject to Lease for Direct Use.--

 ``(1) In general.--Subject to paragraph (2), a geothermal 

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 lease for the direct use of geothermal resources shall cover not 

 more than the quantity of acreage determined by the Secretary to 

 be reasonably necessary for the proposed use.

 ``(2) Limitations.--The quantity of acreage covered by the 

 lease shall not exceed the limitations established under section 

 7.''.

 (c) Application of New Lease Terms.--The <<NOTE: 30 USC 1004 

note.>> schedule of fees established under the amendment made by 

subsection (a)(4) shall apply with respect to payments under a lease 

converted under this subsection that are due and owing, and have been 

paid, on or after July 16, 2003. This subsection shall not require the 

refund of royalties paid to a State under section 20 of the Geothermal 

Steam Act of 1970 (30 U.S.C. 1019) prior to the date of enactment of 

this Act.

SEC. 224. ROYALTIES AND NEAR-TERM PRODUCTION INCENTIVES.

 (a) Royalty.--Section 5 of the Geothermal Steam Act of 1970 (30 

U.S.C. 1004) is further amended--

 (1) in subsection (a) by striking paragraph (1) and 

 inserting the following:

 ``(1) a royalty on electricity produced using geothermal 

 resources, other than direct use of geothermal resources, that 

 shall be--

 ``(A) not less than 1 percent and not more than 2.5 

 percent of the gross proceeds from the sale of 

 electricity produced from such resources during the 

 first 10 years of production under the lease; and

[[Page 119 STAT. 663]]

 ``(B) not less than 2 and not more than 5 percent of 

 the gross proceeds from the sale of electricity produced 

 from such resources during each year after such 10-year 

 period;''; and

 (2) by adding at the end the following:

 ``(c) Final Regulation Establishing Royalty Rates.--In issuing any 

final regulation establishing royalty rates under this section, the 

Secretary shall seek--

 ``(1) to provide lessees a simplified administrative system;

 ``(2) to encourage new development; and

 ``(3) to achieve the same level of royalty revenues over a 

 10-year period as the regulation in effect on the date of 

 enactment of this subsection.

 ``(d) Credits for In-Kind Payments of Electricity.--The Secretary 

may provide to a lessee a credit against royalties owed under this Act, 

in an amount equal to the value of electricity provided under contract 

to a State or county government that is entitled to a portion of such 

royalties under section 20 of this Act, section 35 of the Mineral 

Leasing Act (30 U.S.C. 191), except as otherwise provided by this 

section, or section 6 of the Mineral Leasing Act for Acquired Lands (30 

U.S.C. 355), if--

 ``(1) the Secretary has approved in advance the contract 

 between the lessee and the State or county government for such 

 in-kind payments;

 ``(2) the contract establishes a specific methodology to 

 determine the value of such credits; and

 ``(3) the maximum credit will be equal to the royalty value 

 owed to the State or county that is a party to the contract and 

 the electricity received will serve as the royalty payment from 

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 the Federal Government to that entity.''.

 (b) Disposal of Moneys From Sales, Bonuses, Royalties, and Rents.--

Section 20 of the Geothermal Steam Act of 1970 (30 U.S.C. 1019) is 

amended to read as follows:

``SEC. 20. DISPOSAL OF MONEYS FROM SALES, BONUSES, RENTALS, AND 

 ROYALTIES.

 ``(a) In General.--Except with respect to lands in the State of 

Alaska, all monies received by the United States from sales, bonuses, 

rentals, and royalties under this Act shall be paid into the Treasury of 

the United States. Of amounts deposited under this subsection, subject 

to the provisions of subsection (b) of section 35 of the Mineral Leasing 

Act (30 U.S.C. 191(b)) and section 5(a)(2) of this Act--

 ``(1) 50 percent shall be paid to the State within the 

 boundaries of which the leased lands or geothermal resources are 

 or were located; and

 ``(2) 25 percent shall be paid to the county within the 

 boundaries of which the leased lands or geothermal resources are 

 or were located.

 ``(b) Use of Payments.--Amounts paid to a State or county under 

subsection (a) shall be used consistent with the terms of section 35 of 

the Mineral Leasing Act (30 U.S.C. 191).''.

 (c) Near-Term Production <<NOTE: 30 USC 1004 note.>> Incentive for 

Existing Leases.--

 (1) In general.--Notwithstanding section 5(a) of the 

 Geothermal Steam Act of 1970, the royalty required to be paid 

 shall be 50 percent of the amount of the royalty otherwise 

 required, on any lease issued before the date of enactment

[[Page 119 STAT. 664]]

 of this Act that does not convert to new royalty terms under 

 subsection (e)--

 (A) with respect to commercial production of energy 

 from a facility that begins such production in the 6-

 year period beginning on the date of enactment of this 

 Act; or

 (B) on qualified expansion geothermal energy.

 (2) 4-year application.--Paragraph (1) applies only to new 

 commercial production of energy from a facility in the first 4 

 years of such production.

 (d) Definition of Qualified Expansion Geothermal Energy.--In this 

section, the term ``qualified expansion geothermal energy'' means 

geothermal energy produced from a generation facility for which--

 (1) the production is increased by more than 10 percent as a 

 result of expansion of the facility carried out in the 6-year 

 period beginning on the date of enactment of this Act; and

 (2) such production increase is greater than 10 percent of 

 the average production by the facility during the 5-year period 

 preceding the expansion of the facility (as such average is 

 adjusted to reflect any trend in changes in production during 

 that period).

 (e) Royalty Under Existing Leases.--

 (1) In general.--Any lessee under a lease issued under the 

 Geothermal Steam Act of 1970 (30 U.S.C. 1001 et seq.) before the 

 date of enactment of this Act may, within the time period 

 specified in paragraph (2), submit to the Secretary of the 

 Interior a request to modify the terms of the lease relating to 

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 payment of royalties to provide--

 (A) in the case of a lease that meets the 

 requirements of subsection (b) of section 5 of the 

 Geothermal Steam Act of 1970 (30 U.S.C. 1004) (as 

 amended by section 223), that royalties be based on the 

 schedule of fees established under that section; and

 (B) in the case of any other lease, that royalties 

 be computed on a percentage of the gross proceeds from 

 the sale of electricity, at a royalty rate that is 

 expected to yield total royalty payments equivalent to 

 payments that would have been received for comparable 

 production under the royalty rate in effect for the 

 lease before the date of enactment of this subsection.

 (2) Timing.--A <<NOTE: Deadlines.>> request for a 

 modification under paragraph (1) shall be submitted to the 

 Secretary of the Interior by the date that is not later than--

 (A) in the case of a lease for direct use, 18 months 

 after the effective date of the schedule of fees 

 established by the Secretary of the Interior under 

 section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 

 1004); or

 (B) in the case of any other lease, 18 months after 

 the effective date of the final regulation issued under 

 subsection (a).

 (3) Application of modification.--If the lessee requests 

 modification of a lease under paragraph (1)--

 (A) <<NOTE: Deadline.>> the Secretary of the 

 Interior shall, within 180 days after the receipt of the 

 request for modification, modify the lease to comply 

 with--

[[Page 119 STAT. 665]]

 (i) in the case of a lease for direct use, the 

 schedule of fees established by the Secretary 

 under section 5 of the Geothermal Steam Act of 

 1970 (30 U.S.C. 1004); or

 (ii) in the case of any other lease, the 

 royalty for the lease established under paragraph 

 (1)(B); and

 (B) the modification shall apply to any use of 

 geothermal resources to which subsection (a) applies 

 that occurs after the date of the modification.

 (4) Consultation.--The Secretary of the Interior shall 

 consult with the State and local governments affected by any 

 proposed changes in lease royalty terms under this subsection.

SEC. 225. <<NOTE: 42 USC 15871.>> COORDINATION OF GEOTHERMAL LEASING AND 

 PERMITTING ON FEDERAL LANDS.

 (a) In General.--Not <<NOTE: Deadline. Memorandum.>> later than 180 

days after the date of enactment of this section, the Secretary of the 

Interior and the Secretary of Agriculture shall enter into and submit to 

Congress a memorandum of understanding in accordance with this section, 

the Geothermal Steam Act of 1970 (as amended by this Act), and other 

applicable laws, regarding coordination of leasing and permitting for 

geothermal development of public lands and National Forest System lands 

under their respective jurisdictions.

 (b) Lease and Permit Applications.--The memorandum of understanding 

shall--

 (1) establish an administrative procedure for processing 

 geothermal lease applications, including lines of authority, 

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 steps in application processing, and time limits for application 

 procession;

 (2) establish a 5-year program for geothermal leasing of 

 lands in the National Forest System, and a process for updating 

 that program every 5 years; and

 (3) <<NOTE: Effective date.>> establish a program for 

 reducing the backlog of geothermal lease application pending on 

 January 1, 2005, by 90 percent within the 5-year period 

 beginning on the date of enactment of this Act, including, as 

 necessary, by issuing leases, rejecting lease applications for 

 failure to comply with the provisions of the regulations under 

 which they were filed, or determining that an original applicant 

 (or the applicant's assigns, heirs, or estate) is no longer 

 interested in pursuing the lease application.

 (c) Data Retrieval System.--The memorandum of understanding shall 

establish a joint data retrieval system that is capable of tracking 

lease and permit applications and providing to the applicant information 

as to their status within the Departments of the Interior and 

Agriculture, including an estimate of the time required for 

administrative action.

SEC. 226. <<NOTE: Deadline. 42 USC 15872.>> ASSESSMENT OF GEOTHERMAL 

 ENERGY POTENTIAL.

 Not later than 3 years after the date of enactment of this Act and 

thereafter as the availability of data and developments in technology 

warrants, the Secretary of the Interior, acting through the Director of 

the United States Geological Survey and in cooperation with the States, 

shall--

 (1) update the Assessment of Geothermal Resources made 

 during 1978; and

 (2) submit to Congress the updated assessment.

[[Page 119 STAT. 666]]

SEC. 227. COOPERATIVE OR UNIT PLANS.

 Section 18 of the Geothermal Steam Act of 1970 (30 U.S.C. 1017) is 

amended to read as follows:

``SEC. 18. UNIT AND COMMUNITIZATION AGREEMENTS.

 ``(a) Adoption of Units by Lessees.--

 ``(1) In general.--For the purpose of more properly 

 conserving the natural resources of any geothermal reservoir, 

 field, or like area, or any part thereof (whether or not any 

 part of the geothermal reservoir, field, or like area, is 

 subject to any cooperative plan of development or operation 

 (referred to in this section as a `unit agreement')), lessees 

 thereof and their representatives may unite with each other, or 

 jointly or separately with others, in collectively adopting and 

 operating under a unit agreement for the reservoir, field, or 

 like area, or any part thereof, including direct use resources, 

 if determined and certified by the Secretary to be necessary or 

 advisable in the public interest.

 ``(2) Majority interest of single leases.--A majority 

 interest of owners of any single lease shall have the authority 

 to commit the lease to a unit agreement.

 ``(3) Initiative of secretary.--The Secretary may also 

 initiate the formation of a unit agreement, or require an 

 existing Federal lease to commit to a unit agreement, if in the 

 public interest.

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 ``(4) Modification of lease requirements by secretary.--

 ``(A) In general.--The Secretary may, in the 

 discretion of the Secretary and with the consent of the 

 holders of leases involved, establish, alter, change, or 

 revoke rates of operations (including drilling, 

 operations, production, and other requirements) of the 

 leases and make conditions with respect to the leases, 

 with the consent of the lessees, in connection with the 

 creation and operation of any such unit agreement as the 

 Secretary may consider necessary or advisable to secure 

 the protection of the public interest.

 ``(B) Unlike terms or rates.--Leases with unlike 

 lease terms or royalty rates shall not be required to be 

 modified to be in the same unit.

 ``(b) Requirement of Plans Under New Leases.--The Secretary may--

 ``(1) provide that geothermal leases issued under this Act 

 shall contain a provision requiring the lessee to operate under 

 a unit agreement; and

 ``(2) prescribe the unit agreement under which the lessee 

 shall operate, which shall adequately protect the rights of all 

 parties in interest, including the United States.

 ``(c) Modification of Rate of Prospecting, Development, and 

Production.--The Secretary may require that any unit agreement 

authorized by this section that applies to land owned by the United 

States contain a provision under which authority is vested in the 

Secretary, or any person, committee, or State or Federal officer or 

agency as may be designated in the unit agreement to alter or modify, 

from time to time, the rate of prospecting and development and the 

quantity and rate of production under the unit agreement.

[[Page 119 STAT. 667]]

 ``(d) Exclusion From Determination of Holding or Control.--Any land 

that is subject to a unit agreement approved or prescribed by the 

Secretary under this section shall not be considered in determining 

holdings or control under section 7.

 ``(e) Pooling of Certain Land.--If separate tracts of land cannot be 

independently developed and operated to use geothermal resources 

pursuant to any section of this Act--

 ``(1) the land, or a portion of the land, may be pooled with 

 other land, whether or not owned by the United States, for 

 purposes of development and operation under a communitization 

 agreement providing for an apportionment of production or 

 royalties among the separate tracts of land comprising the 

 production unit, if the pooling is determined by the Secretary 

 to be in the public interest; and

 ``(2) operation or production pursuant to the 

 communitization agreement shall be treated as operation or 

 production with respect to each tract of land that is subject to 

 the communitization agreement.

 ``(f) Unit Agreement Review.--

 ``(1) In general.--Not <<NOTE: Deadlines.>> later than 5 

 years after the date of approval of any unit agreement and at 

 least every 5 years thereafter, the Secretary shall--

 ``(A) review each unit agreement; and

 ``(B) after notice and opportunity for comment, 

 eliminate from inclusion in the unit agreement any land 

 that the Secretary determines is not reasonably

 necessary for unit operations under the unit agreement.

 ``(2) Basis for elimination.--The elimination shall--

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 ``(A) be based on scientific evidence; and

 ``(B) occur only if the elimination is determined by 

 the Secretary to be for the purpose of conserving and 

 properly managing the geothermal resource.

 ``(3) Extension.--Any land eliminated under this subsection 

 shall be eligible for an extension under section 6(g) if the 

 land meets the requirements for the extension.

 ``(g) Drilling or Development Contracts.--

 ``(1) In general.--The Secretary may, on such conditions as 

 the Secretary may prescribe, approve drilling or development 

 contracts made by one or more lessees of geothermal leases, with 

 one or more persons, associations, or corporations if, in the 

 discretion of the Secretary, the conservation of natural 

 resources or the public convenience or necessity may require or 

 the interests of the United States may be best served by the 

 approval.

 ``(2) Holdings or control.--Each lease operated under an 

 approved drilling or development contract, and interest under 

 the contract, shall be excepted in determining holdings or 

 control under section 7.

 ``(h) Coordination With State Governments.--The Secretary shall 

coordinate unitization and pooling activities with appropriate State 

agencies.''.

SEC. 228. ROYALTY ON BYPRODUCTS.

 Section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 1004) (as 

amended by section 223(a)) is further amended in subsection (a) by 

striking paragraph (2) and inserting the following:

[[Page 119 STAT. 668]]

 ``(2) a royalty on any byproduct that is a mineral specified 

 in the first section of the Mineral Leasing Act (30 U.S.C. 181), 

 and that is derived from production under the lease, at the rate 

 of the royalty that applies under that Act to production of the 

 mineral under a lease under that Act;''.

SEC. 229. AUTHORITIES OF SECRETARY TO READJUST TERMS, CONDITIONS, 

 RENTALS, AND ROYALTIES.

 Section 8(b) of the Geothermal Steam Act of 1970 (30 U.S.C. 1006) is 

amended in the <<NOTE: 30 USC 1007.>> second sentence by striking 

``period, and in no event'' and all that follows through the end of the 

sentence and inserting ``period''.

SEC. 230. CREDITING OF RENTAL TOWARD ROYALTY.

 Section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 1004) (as 

amended by sections 223 and 224) is further amended--

 (1) in subsection (a)(2) by inserting ``and'' after the 

 semicolon at the end;

 (2) in subsection (a)(3) by striking ``; and'' and inserting 

 a period;

 (3) by striking paragraph (4) of subsection (a); and

 (4) by adding at the end the following:

 ``(e) Crediting of Rental Toward Royalty.--Any annual rental under 

this section that is paid with respect to a lease before the first day 

of the year for which the annual rental is owed shall be credited to the 

amount of royalty that is required to be paid under the lease for that 

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year.''.

SEC. 231. LEASE DURATION AND WORK COMMITMENT REQUIREMENTS.

 Section 6 of the Geothermal Steam Act of 1970 (30 U.S.C. 1005) is 

amended--

 (1) by striking so much as precedes subsection (c), and 

 striking subsections (e), (g), (h), (i), and (j);

 (2) by redesignating subsections (c), (d), and (f) in order 

 as subsections (g), (h), and (i); and

 (3) by inserting before subsection (g), as so redesignated, 

 the following:

``SEC. 6. <<NOTE: Regulations.>> LEASE TERM AND WORK COMMITMENT 

 REQUIREMENTS.

 ``(a) In General.--

 ``(1) Primary term.--A geothermal lease shall be for a 

 primary term of 10 years.

 ``(2) Initial extension.--The Secretary shall extend the 

 primary term of a geothermal lease for 5 years if, for each year 

 after the 10th year of the lease--

 ``(A) the Secretary determined under subsection (b) 

 that the lessee satisfied the work commitment 

 requirements that applied to the lease for that year; or

 ``(B) the lessee paid in annual payments accordance 

 with subsection (c).

 ``(3) Additional extension.--The Secretary shall extend the 

 primary term of a geothermal lease (after an initial extension 

 under paragraph (2)) for an additional 5 years if, for each year 

 of the initial extension under paragraph (2), the Secretary 

 determined under subsection (b) that the lessee satisfied the 

 minimum work requirements that applied to the lease for that 

 year.

[[Page 119 STAT. 669]]

 ``(b) Requirement to Satisfy Annual Minimum Work Requirement.--

 ``(1) In general.--The lessee for a geothermal lease shall, 

 for each year after the 10th year of the lease, satisfy minimum 

 work requirements prescribed by the Secretary that apply to the 

 lease for that year.

 ``(2) Prescription of minimum work requirements.--The 

 Secretary shall issue regulations prescribing minimum work 

 requirements for geothermal leases, that--

 ``(A) establish a geothermal potential; and

 ``(B) if a geothermal potential has been 

 established, confirm the existence of producible 

 geothermal resources.

 ``(c) Payments in Lieu of Minimum Work Requirements.--In lieu of the 

minimum work requirements set forth in subsection (b)(2), the Secretary 

shall by regulation establish minimum annual payments which may be made 

by the lessee for a limited number of years that the Secretary 

determines will not impair achieving diligent development of the 

geothermal resource, but in no event shall the number of years exceed 

the duration of the extension period provided in subsection (a).

 ``(d) Transition Rules for Leases Issued Prior to Enactment of 

Energy Policy Act of 2005.--The Secretary shall by regulation establish 

transition rules for leases issued before the date of the enactment of 

this subsection, including terms under which a lease that is near the 

end of its term on the date of enactment of this subsection may be 

extended for up to 2 years--

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 ``(1) to allow achievement of production under the lease; or

 ``(2) to allow the lease to be included in a producing unit.

 ``(e) Geothermal Lease Overlying Mining Claim.--

 ``(1) Exemption.--The lessee for a geothermal lease of an 

 area overlying an area subject to a mining claim for which a 

 plan of operations has been approved by the relevant Federal 

 land management agency is exempt from annual work requirements 

 established under this Act, if development of the geothermal 

 resource subject to the lease would interfere with the mining 

 operations under such claim.

 ``(2) Termination of exemption.--An exemption under this 

 paragraph expires upon the termination of the mining operations.

 ``(f) Termination of Application of Requirements.--Minimum work 

requirements prescribed under this section shall not apply to a 

geothermal lease after the date on which the geothermal resource is 

utilized under the lease in commercial quantities.''.

SEC. 232. ADVANCED ROYALTIES REQUIRED FOR CESSATION OF PRODUCTION.

 Section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 1004) (as 

amended by sections 223, 224, and 230) is further amended by adding at 

the end the following:

 ``(f) Advanced Royalties Required for Cessation of Production.--

 ``(1) In general.--Subject to paragraphs (2) and (3), if, at 

 any time after commercial production under a lease is achieved, 

 production ceases for any reason, the lease shall remain in full 

 force and effect for a period of not more than

[[Page 119 STAT. 670]]

 an aggregate number of 10 years beginning on the date production 

 ceases, if, during the period in which production is ceased, the 

 lessee pays royalties in advance at the monthly average rate at 

 which the royalty was paid during the period of production.

 ``(2) Reduction.--The amount of any production royalty paid 

 for any year shall be reduced (but not below 0) by the amount of 

 any advanced royalties paid under the lease to the extent that 

 the advance royalties have not been used to reduce production 

 royalties for a prior year.

 ``(3) Exceptions.--Paragraph (1) shall not apply if the 

 cessation in production is required or otherwise caused by--

 ``(A) the Secretary;

 ``(B) the Secretary of the Air Force;

 ``(C) the Secretary of the Army;

 ``(D) the Secretary of the Navy;

 ``(E) a State or a political subdivision of a State; 

 or

 ``(F) a force majeure.''.

SEC. 233. ANNUAL RENTAL.

 (a) Annual Rental Rate.--Section 5 of the Geothermal Steam Act of 

1970 (30 U.S.C. 1004) (as amended by section 223(a)) is further amended 

in subsection (a) by striking paragraph (3) and inserting the following:

 ``(3) payment in advance of an annual rental of not less 

 than--

 ``(A) for each of the 1st through 10th years of the 

 lease--

 ``(i) in the case of a lease awarded in a 

 noncompetitive lease sale, $1 per acre or fraction 

 thereof; or

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 ``(ii) in the case of a lease awarded in a 

 competitive lease sale, $2 per acre or fraction 

 thereof for the 1st year and $3 per acre or 

 fraction thereof for each of the 2nd through 10th 

 years; and

 ``(B) for each year after the 10th year of the 

 lease, $5 per acre or fraction thereof;''.

 (b) Termination of Lease for Failure to Pay Rental.--Section 5 of 

the Geothermal Steam Act of 1970 (30 U.S.C. 1004) (as amended by 

sections 223, 224, 230, and 232) is further amended by adding at the end 

the following:

 ``(g) Termination of Lease for Failure to Pay Rental.--

 ``(1) In general.--The Secretary shall terminate any lease 

 with respect to which rental is not paid in accordance with this 

 Act and the terms of the lease under which the rental is 

 required, on the expiration of the 45-day period beginning on 

 the date of the failure to pay the rental.

 ``(2) Notification.--The Secretary shall promptly notify a 

 lessee that has not paid rental required under the lease that 

 the lease will be terminated at the end of the period referred 

 to in paragraph (1).

 ``(3) Reinstatement.--A lease that would otherwise terminate 

 under paragraph (1) shall not terminate under that paragraph if 

 the lessee pays to the Secretary, before the end of the period 

 referred to in paragraph (1), the amount of rental due plus a 

 late fee equal to 10 percent of the amount.''.

[[Page 119 STAT. 671]]

SEC. 234. <<NOTE: 42 USC 15873.>> DEPOSIT AND USE OF GEOTHERMAL LEASE 

 REVENUES FOR 5 FISCAL YEARS.

 (a) Deposit of Geothermal Resources Leases.--Notwithstanding any 

other provision of law, amounts received by the United States in the 

first 5 fiscal years beginning after the date of enactment of this Act 

as rentals, royalties, and other payments required under leases under 

the Geothermal Steam Act of 1970, excluding funds required to be paid to 

State and county governments, shall be deposited into a separate account 

in the Treasury.

 (b) Use of Deposits.--Amounts deposited under subsection (a) shall 

be available to the Secretary of the Interior for expenditure, without 

further appropriation and without fiscal year limitation, to implement 

the Geothermal Steam Act of 1970 and this Act.

 (c) Transfer of Funds.--For the purposes of coordination and 

processing of geothermal leases and geothermal use authorizations on 

Federal land the Secretary of the Interior may authorize the expenditure 

or transfer of such funds as are necessary to the Forest Service.

SEC. 235. ACREAGE LIMITATIONS.

 Section 7 of the Geothermal Steam Act of 1970 (30 U.S.C. 1006) is 

amended--

 (1) by striking ``sec. 7.'', and by inserting immediately 

 before and above the first paragraph the following:

``SEC. 7. ACREAGE LIMITATIONS.'';

 (2) in the first paragraph--

 (A) by striking ``two thousand five hundred and 

 sixty acres'' and inserting ``5,120 acres''; and

 (B) by striking ``twenty thousand four hundred and 

 eighty acres'' and inserting ``51,200 acres''; and

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 (3) by striking the second paragraph.

SEC. 236. TECHNICAL AMENDMENTS.

 The Geothermal Steam Act of 1970 (30 U.S.C. 1001 et seq.) is further 

amended as follows:

 (1) <<NOTE: 30 USC 1001, 1002, 1005, 1020, 1022, 1024-

 1026.>> By striking ``geothermal steam and associated geothermal 

 resources'' each place it appears and inserting ``geothermal 

 resources''.

 (2) Section 2 (30 U.S.C. 1001) is amended by adding at the 

 end the following:

 ``(g) `direct use' means utilization of geothermal resources 

 for commercial, residential, agricultural, public facilities, or 

 other energy needs other than the commercial production of 

 electricity; and''.

 (3) Section 21 (30 U.S.C. 1020) is amended by striking ``(a) 

 Within one hundred'' and all that follows through ``(b) 

 Geothermal'' and inserting ``Geothermal''.

 (4) The first section (30 U.S.C. 1001 note) is amended by 

 striking ``That this'' and inserting the following:

``SEC. 1. SHORT TITLE.

 ``This''.

 (5) Section 2 (30 U.S.C. 1001) is amended by striking ``sec. 

 2. As'' and inserting the following:

``SEC. 2. DEFINITIONS.

 ``As''.

[[Page 119 STAT. 672]]

 (6) Section 3 (30 U.S.C. 1002) is amended by striking ``sec. 

 3. Subject'' and inserting the following:

``SEC. 3. LANDS SUBJECT TO GEOTHERMAL LEASING.

 ``Subject''.

 (7) Section 5 (30 U.S.C. 1004) is further amended by 

 striking ``sec. 5.'', and by inserting immediately before and 

 above subsection (a) the following:

``SEC. 5. RENTS AND ROYALTIES.''.

 (8) Section 8 (30 U.S.C. 1007) is amended by striking ``sec. 

 8. (a) The'' and inserting the following:

``SEC. 8. READJUSTMENT OF LEASE TERMS AND CONDITIONS.

 ``(a) The''.

 (9) Section 9 (30 U.S.C. 1008) is amended by striking ``sec. 

 9. If'' and inserting the following:

``SEC. 9. BYPRODUCTS.

 ``If''.

 (10) Section 10 (30 U.S.C. 1009) is amended by striking 

 ``sec. 10. The'' and inserting the following:

``SEC. 10. RELINQUISHMENT OF GEOTHERMAL RIGHTS.

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 ``The''.

 (11) Section 11 (30 U.S.C. 1010) is amended by striking 

 ``sec. 11. The'' and inserting the following:

``SEC. 11. SUSPENSION OF OPERATIONS AND PRODUCTION.

 ``The''.

 (12) Section 12 (30 U.S.C. 1011) is amended by striking 

 ``sec. 12. Leases'' and inserting the following:

``SEC. 12. TERMINATION OF LEASES.

 ``Leases''.

 (13) Section 13 (30 U.S.C. 1012) is amended by striking 

 ``sec. 13. The'' and inserting the following:

``SEC. 13. WAIVER, SUSPENSION, OR REDUCTION OF RENTAL OR ROYALTY.

 ``The''.

 (14) Section 14 (30 U.S.C. 1013) is amended by striking 

 ``sec. 14. Subject'' and inserting the following:

``SEC. 14. SURFACE LAND USE.

 ``Subject''.

 (15) Section 15 (30 U.S.C. 1014) is amended by striking 

 ``sec. 15. (a) Geothermal'' and inserting the following:

``SEC. 15. LANDS SUBJECT TO GEOTHERMAL LEASING.

 ``(a) Geothermal''.

 (16) Section 16 (30 U.S.C. 1015) is amended by striking 

 ``sec. 16. Leases'' and inserting the following:

``SEC. 16. REQUIREMENT FOR LESSEES.

 ``Leases''.

 (17) Section 17 (30 U.S.C. 1016) is amended by striking 

 ``sec. 17. Administration'' and inserting the following:

[[Page 119 STAT. 673]]

``SEC. 17. ADMINISTRATION.

 ``Administration''.

 (18) Section 19 (30 U.S.C. 1018) is amended by striking 

 ``sec. 19. Upon'' and inserting the following:

``SEC. 19. DATA FROM FEDERAL AGENCIES.

 ``Upon''.

 (19) Section 21 (30 U.S.C. 1020) is further amended by 

 striking ``sec. 21.'', and by inserting immediately before and 

 above the remainder of that section the following:

``SEC. 21. PUBLICATION IN FEDERAL REGISTER; RESERVATION OF MINERAL 

 RIGHTS.''.

 (20) Section 22 (30 U.S.C. 1021) is amended by striking 

 ``sec. 22. Nothing'' and inserting the following:

``SEC. 22. FEDERAL EXEMPTION FROM STATE WATER LAWS.

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 ``Nothing''.

 (21) Section 23 (30 U.S.C. 1022) is amended by striking 

 ``sec. 23. (a) All'' and inserting the following:

``SEC. 23. PREVENTION OF WASTE; EXCLUSIVITY.

 ``(a) All''.

 (22) Section 24 (30 U.S.C. 1023) is amended by striking 

 ``sec. 24. The'' and inserting the following:

``SEC. 24. RULES AND REGULATIONS.

 ``The''.

 (23) Section 25 (30 U.S.C. 1024) is amended by striking 

 ``sec. 25. As'' and inserting the following:

``SEC. 25. INCLUSION OF GEOTHERMAL LEASING UNDER CERTAIN OTHER LAWS.

 ``As''.

 (24) Section 26 <<NOTE: 30 USC 530.>> is amended by striking 

 ``sec. 26. The'' and inserting the following:

``SEC. 26. AMENDMENT.

 ``The''.

 (25) Section 27 (30 U.S.C. 1025) is amended by striking 

 ``sec. 27. The'' and inserting the following:

``SEC. 27. FEDERAL RESERVATION OF CERTAIN MINERAL RIGHTS.

 ``The''.

 (26) Section 28 (30 U.S.C. 1026) is amended by striking 

 ``sec. 28. (a)(1) The'' and inserting the following:

``SEC. 28. SIGNIFICANT THERMAL FEATURES.

 ``(a)(1) The''.

 (27) Section 29 (30 U.S.C. 1027) is amended by striking 

 ``sec. 29. The'' and inserting the following:

``SEC. 29. LAND SUBJECT TO PROHIBITION ON LEASING.

 ``The''.

SEC. 237. INTERMOUNTAIN WEST GEOTHERMAL CONSORTIUM.

 (a) Participation Authorized.--The Secretary, acting through the 

Idaho National Laboratory, may participate in a consortium described in 

subsection (b) to address science and science policy

[[Page 119 STAT. 674]]

issues surrounding the expanded discovery and use of geothermal energy, 

including from geothermal resources on public lands.

 (b) Members.--The <<NOTE: Establishment.>> consortium referred to in 

subsection (a) shall--

 (1) be known as the ``Intermountain West Geothermal 

 Consortium'';

 (2) be a regional consortium of institutions and government 

 agencies that focuses on building collaborative efforts among 

 the universities in the State of Idaho, other regional 

 universities, State agencies, and the Idaho National Laboratory;

 (3) include Boise State University, the University of Idaho 

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 (including the Idaho Water Resources Research Institute), the 

 Oregon Institute of Technology, the Desert Research Institute 

 with the University and Community College System of Nevada, and 

 the Energy and Geoscience Institute at the University of Utah;

 (4) be hosted and managed by Boise State University; and

 (5) have a director appointed by Boise State University, and 

 associate directors appointed by each participating institution.

 (c) Financial Assistance.--The Secretary, acting through the Idaho 

National Laboratory and subject to the availability of appropriations, 

will provide financial assistance to Boise State University for 

expenditure under contracts with members of the consortium to carry out 

the activities of the consortium.

 Subtitle C--Hydroelectric

SEC. 241. ALTERNATIVE CONDITIONS AND FISHWAYS.

 (a) Federal Reservations.--Section 4(e) of the Federal Power Act (16 

U.S.C. 797(e)) is amended by inserting after ``adequate protection and 

utilization of such reservation.'' at the end of the first proviso the 

following: ``The license applicant and any party to the proceeding shall 

be entitled to a determination on the record, after opportunity for an 

agency trial-type hearing of no more than 90 days, on any disputed 

issues of material fact with respect to such conditions. All disputed 

issues of material fact raised by any party shall be determined in a 

single trial-type hearing to be conducted by the relevant resource 

agency in accordance with the regulations promulgated under this 

subsection and within the time frame established by the Commission for 

each license proceeding. 

Within <<NOTE: Deadline. Regulations. Procedures.>> 90 days of the date 

of enactment of the Energy Policy Act of 2005, the Secretaries of the 

Interior, Commerce, and Agriculture shall establish jointly, by rule, 

the procedures for such expedited trial-type hearing, including the 

opportunity to undertake discovery and cross-examine witnesses, in 

consultation with the Federal Energy Regulatory Commission.''.

 (b) Fishways.--Section 18 of the Federal Power Act (16 U.S.C. 811) 

is amended by inserting after ``and such fishways as may be prescribed 

by the Secretary of Commerce.'' the <<NOTE: Deadline.>> following: ``The 

license applicant and any party to the proceeding shall be entitled to a 

determination on the record, after opportunity for an agency trial-type 

hearing of no more than 90 days, on any disputed issues of material fact 

with respect to such fishways. All disputed issues of material fact 

raised by any party shall be determined in a

[[Page 119 STAT. 675]]

single trial-type hearing to be conducted by the relevant resource 

agency in accordance with the regulations promulgated under this 

subsection and within the time frame established by the Commission for 

each license 

proceeding. <<NOTE: Deadline. Regulations. Procedures.>> Within 90 days 

of the date of enactment of the Energy Policy Act of 2005, the 

Secretaries of the Interior, Commerce, and Agriculture shall establish 

jointly, by rule, the procedures for such expedited trial-type hearing, 

including the opportunity to undertake discovery and cross-examine 

witnesses, in consultation with the Federal Energy Regulatory 

Commission.''.

 (c) Alternative Conditions and Prescriptions.--Part I of the Federal 

Power Act (16 U.S.C. 791a et seq.) is amended by adding the following 

new section at the end thereof:

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``SEC. 33. <<NOTE: 16 USC 823d.>> ALTERNATIVE CONDITIONS AND 

 PRESCRIPTIONS.

 ``(a) Alternative Conditions.--(1) Whenever any person applies for a 

license for any project works within any reservation of the United 

States, and the Secretary of the department under whose supervision such 

reservation falls (referred to in this subsection as the `Secretary') 

deems a condition to such license to be necessary under the first 

proviso of section 4(e), the license applicant or any other party to the 

license proceeding may propose an alternative condition.

 ``(2) Notwithstanding the first proviso of section 4(e), the 

Secretary shall accept the proposed alternative condition referred to in 

paragraph (1), and the Commission shall include in the license such 

alternative condition, if the Secretary determines, based on substantial 

evidence provided by the license applicant, any other party to the 

proceeding, or otherwise available to the Secretary, that such 

alternative condition--

 ``(A) provides for the adequate protection and utilization 

 of the reservation; and

 ``(B) will either, as compared to the condition initially by 

 the Secretary--

 ``(i) cost significantly less to implement; or

 ``(ii) result in improved operation of the project 

 works for electricity production.

 ``(3) In making a determination under paragraph (2), the Secretary 

shall consider evidence provided for the record by any party to a 

licensing proceeding, or otherwise available to the Secretary, including 

any evidence provided by the Commission, on the implementation costs or 

operational impacts for electricity production of a proposed 

alternative.

 ``(4) <<NOTE: Public information. Records.>> The Secretary concerned 

shall submit into the public record of the Commission proceeding with 

any condition under section 4(e) or alternative condition it accepts 

under this section, a written statement explaining the basis for such 

condition, and reason for not accepting any alternative condition under 

this section. The written statement must demonstrate that the Secretary 

gave equal consideration to the effects of the condition adopted and 

alternatives not accepted on energy supply, distribution, cost, and use; 

flood control; navigation; water supply; and air quality (in addition to 

the preservation of other aspects of environmental quality); based on 

such information as may be available to the Secretary, including 

information voluntarily provided in a timely manner by the applicant and 

others. The Secretary shall also submit, together with the 

aforementioned written statement, all studies, data, and

[[Page 119 STAT. 676]]

other factual information available to the Secretary and relevant to the 

Secretary's decision.

 ``(5) If the Commission finds that the Secretary's final condition 

would be inconsistent with the purposes of this part, or other 

applicable law, the Commission may refer the dispute to the Commission's 

Dispute Resolution Service. <<NOTE: Deadline.>> The Dispute Resolution 

Service shall consult with the Secretary and the Commission and issue a 

non-binding advisory within 90 days. The Secretary may accept the 

Dispute Resolution Service advisory unless the Secretary finds that the 

recommendation will not adequately protect the 

reservation. <<NOTE: Records.>> The Secretary shall submit the advisory 

and the Secretary's final written determination into the record of the 

Commission's proceeding.

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 ``(b) Alternative Prescriptions.--(1) Whenever the Secretary of the 

Interior or the Secretary of Commerce prescribes a fishway under section 

18, the license applicant or any other party to the license proceeding 

may propose an alternative to such prescription to construct, maintain, 

or operate a fishway.

 ``(2) Notwithstanding section 18, the Secretary of the Interior or 

the Secretary of Commerce, as appropriate, shall accept and prescribe, 

and the Commission shall require, the proposed alternative referred to 

in paragraph (1), if the Secretary of the appropriate department 

determines, based on substantial evidence provided by the license 

applicant, any other party to the proceeding, or otherwise available to 

the Secretary, that such alternative--

 ``(A) will be no less protective than the fishway initially 

 prescribed by the Secretary; and

 ``(B) will either, as compared to the fishway initially 

 prescribed by the Secretary--

 ``(i) cost significantly less to implement; or

 ``(ii) result in improved operation of the project 

 works for electricity production.

 ``(3) In making a determination under paragraph (2), the Secretary 

shall consider evidence provided for the record by any party to a 

licensing proceeding, or otherwise available to the Secretary, including 

any evidence provided by the Commission, on the implementation costs or 

operational impacts for electricity production of a proposed 

alternative.

 ``(4) <<NOTE: Public information. Records.>> The Secretary concerned 

shall submit into the public record of the Commission proceeding with 

any prescription under section 18 or alternative prescription it accepts 

under this section, a written statement explaining the basis for such 

prescription, and reason for not accepting any alternative prescription 

under this section. The written statement must demonstrate that the 

Secretary gave equal consideration to the effects of the prescription 

adopted and alternatives not accepted on energy supply, distribution, 

cost, and use; flood control; navigation; water supply; and air quality 

(in addition to the preservation of other aspects of environmental 

quality); based on such information as may be available to the 

Secretary, including information voluntarily provided in a timely manner 

by the applicant and others. The Secretary shall also submit, together 

with the aforementioned written statement, all studies, data, and other 

factual information available to the Secretary and relevant to the 

Secretary's decision.

 ``(5) If the Commission finds that the Secretary's final 

prescription would be inconsistent with the purposes of this part, or 

other applicable law, the Commission may refer the dispute to the

[[Page 119 STAT. 677]]

Commission's Dispute Resolution Service. <<NOTE: Deadline.>> The Dispute 

Resolution Service shall consult with the Secretary and the Commission 

and issue a non-binding advisory within 90 days. The Secretary may 

accept the Dispute Resolution Service advisory unless the Secretary 

finds that the recommendation will not adequately protect the fish 

resources. <<NOTE: Records.>> The Secretary shall submit the advisory 

and the Secretary's final written determination into the record of the 

Commission's proceeding.''.

SEC. 242. <<NOTE: 42 USC 15881.>> HYDROELECTRIC PRODUCTION INCENTIVES.

 (a) Incentive Payments.--For electric energy generated and sold by a 

qualified hydroelectric facility during the incentive period, the 

Secretary shall make, subject to the availability of appropriations, 

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incentive payments to the owner or operator of such facility. The amount 

of such payment made to any such owner or operator shall be as 

determined under subsection (e) of this section. Payments under this 

section may only be made upon receipt by the Secretary of an incentive 

payment application which establishes that the applicant is eligible to 

receive such payment and which satisfies such other requirements as the 

Secretary deems necessary. Such application shall be in such form, and 

shall be submitted at such time, as the Secretary shall establish.

 (b) Definitions.--For purposes of this section:

 (1) Qualified hydroelectric facility.--The term ``qualified 

 hydroelectric facility'' means a turbine or other generating 

 device owned or solely operated by a non-Federal entity which 

 generates hydroelectric energy for sale and which is added to an 

 existing dam or conduit.

 (2) Existing dam or conduit.--The term ``existing dam or 

 conduit'' means any dam or conduit the construction of which was 

 completed before the date of the enactment of this section and 

 which does not require any construction or enlargement of 

 impoundment or diversion structures (other than repair or 

 reconstruction) in connection with the installation of a turbine 

 or other generating device.

 (3) Conduit.--The term ``conduit'' has the same meaning as 

 when used in section 30(a)(2) of the Federal Power Act (16 

 U.S.C. 823a(a)(2)).

The <<NOTE: Applicability.>> terms defined in this subsection shall 

apply without regard to the hydroelectric kilowatt capacity of the 

facility concerned, without regard to whether the facility uses a dam 

owned by a governmental or nongovernmental entity, and without regard to 

whether the facility begins operation on or after the date of the 

enactment of this section.

 (c) Eligibility Window.--Payments may be made under this section 

only for electric energy generated from a qualified hydroelectric 

facility which begins operation during the period of 10 fiscal years 

beginning with the first full fiscal year occurring after the date of 

enactment of this subtitle.

 (d) Incentive Period.--A qualified hydroelectric facility may 

receive payments under this section for a period of 10 fiscal years 

(referred to in this section as the ``incentive period''). Such period 

shall begin with the fiscal year in which electric energy generated from 

the facility is first eligible for such payments.

 (e) Amount of Payment.--

 (1) In general.--Payments made by the Secretary under this 

 section to the owner or operator of a qualified hydroelectric

[[Page 119 STAT. 678]]

 facility shall be based on the number of kilowatt hours of 

 hydroelectric energy generated by the facility during the 

 incentive period. For any such facility, the amount of such 

 payment shall be 1.8 cents per kilowatt hour (adjusted as 

 provided in paragraph (2)), subject to the availability of 

 appropriations under subsection (g), except that no facility may 

 receive more than $750,000 in 1 calendar year.

 (2) Adjustments.--The amount of the payment made to any 

 person under this section as provided in paragraph (1) shall be 

 adjusted for inflation for each fiscal year beginning after 

 calendar year 2005 in the same manner as provided in the 

 provisions of section 29(d)(2)(B) of the Internal Revenue Code 

 of 1986, except that in applying such provisions the calendar 

 year 2005 shall be substituted for calendar year 1979.

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 (f) Sunset.--No payment may be made under this section to any 

qualified hydroelectric facility after the expiration of the period of 

20 fiscal years beginning with the first full fiscal year occurring 

after the date of enactment of this subtitle, and no payment may be made 

under this section to any such facility after a payment has been made 

with respect to such facility for a period of 10 fiscal years.

 (g) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out the purposes of this section 

$10,000,000 for each of the fiscal years 2006 through 2015.

SEC. 243. <<NOTE: 42 USC 15882.>> HYDROELECTRIC EFFICIENCY IMPROVEMENT.

 (a) Incentive Payments.--The Secretary shall make incentive payments 

to the owners or operators of hydroelectric facilities at existing dams 

to be used to make capital improvements in the facilities that are 

directly related to improving the efficiency of such facilities by at 

least 3 percent.

 (b) Limitations.--Incentive payments under this section shall not 

exceed 10 percent of the costs of the capital improvement concerned and 

not more than 1 payment may be made with respect to improvements at a 

single facility. No payment in excess of $750,000 may be made with 

respect to improvements at a single facility.

 (c) Authorization of Appropriations.--There are authorized to be 

appropriated to carry out this section not more than $10,000,000 for 

each of the fiscal years 2006 through 2015.

SEC. 244. ALASKA STATE JURISDICTION OVER SMALL HYDROELECTRIC PROJECTS.

 Section 32 of the Federal Power Act (16 U.S.C. 823c) is amended--

 (1) in subsection (a)(3)(C), by inserting ``except as 

 provided in subsection (j),'' before ``conditions''; and

 (2) by adding at the end the following:

 ``(j) Fish and Wildlife.--If the State of Alaska determines that a 

recommendation under subsection (a)(3)(C) is inconsistent with 

paragraphs (1) and (2) of subsection (a), the State of Alaska may 

decline to adopt all or part of the recommendations in accordance with 

the procedures established under section 10(j)(2).''.

SEC. 245. <<NOTE: Montana.>> FLINT CREEK HYDROELECTRIC PROJECT.

 (a) Extension of Time.--

Notwithstanding <<NOTE: Applicability. Effective dates.>> the time 

period specified in section 5 of the Federal Power Act (16 U.S.C. 798)

[[Page 119 STAT. 679]]

that would otherwise apply to the Federal Energy Regulatory Commission 

(referred to in this section as the ``Commission'') project numbered 

12107, the Commission shall--

 (1) if the preliminary permit is in effect on the date of 

 enactment of this Act, extend the preliminary permit for a 

 period of 3 years beginning on the date on which the preliminary 

 permit expires; or

 (2) if the preliminary permit expired before the date of 

 enactment of this Act, on request of the permittee, reinstate 

 the preliminary permit for an additional 3-year period beginning 

 on the date of enactment of this Act.

 (b) Limitation on Certain Fees.--Notwithstanding section 10(e)(1) of 

the Federal Power Act (16 U.S.C. 803(e)(1)) or any other provision of 

Federal law providing for the payment to the United States of charges 

for the use of Federal land for the purposes of operating and 

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maintaining a hydroelectric development licensed by the Commission, any 

political subdivision of the State of Montana that holds a Commission 

license for the Commission project numbered 12107 in Granite and Deer 

Lodge Counties, Montana, shall be required to pay to the United States 

for the use of that land for each year during which the political 

subdivision continues to hold the license for the project, the lesser 

of--

 (1) $25,000; or

 (2) such annual charge as the Commission or any other 

 department or agency of the Federal Government may assess.

SEC. 246. SMALL HYDROELECTRIC POWER PROJECTS.

 Section 408(a)(6) of the Public Utility Regulatory Policies Act of 

1978 (16 U.S.C. 2708(a)(6)) is amended by striking ``April 20, 1977'' 

and inserting ``July 22, 2005''.

 Subtitle D--Insular Energy

SEC. 251. INSULAR AREAS ENERGY SECURITY.

 Section 604 of the Act entitled ``An Act to authorize appropriations 

for certain insular areas of the United States, and for other 

purposes'', approved December 24, 1980 (48 U.S.C. 1492), is amended--

 (1) in subsection (a)(4) by striking the period and 

 inserting a semicolon;

 (2) by adding at the end of subsection (a) the following new 

 paragraphs:

 ``(5) electric power transmission and distribution lines in 

 insular areas are inadequate to withstand damage caused by the 

 hurricanes and typhoons which frequently occur in insular areas 

 and such damage often costs millions of dollars to repair; and

 ``(6) the refinement of renewable energy technologies since 

 the publication of the 1982 Territorial Energy Assessment 

 prepared pursuant to subsection (c) reveals the need to reassess 

 the state of energy production, consumption, infrastructure, 

 reliance on imported energy, opportunities for energy 

 conservation and increased energy efficiency, and indigenous 

 sources in regard to the insular areas.'';

 (3) by amending subsection (e) to read as follows:

[[Page 119 STAT. 680]]

 ``(e)(1) The Secretary of the Interior, in consultation with the 

Secretary of Energy and the head of government of each insular area, 

shall update the plans required under subsection (c) by--

 ``(A) updating the contents required by subsection (c);

 ``(B) drafting long-term energy plans for such insular areas 

 with the objective of reducing, to the extent feasible, their 

 reliance on energy imports by the year 2012, increasing energy 

 conservation and energy efficiency, and maximizing, to the 

 extent feasible, use of indigenous energy sources; and

 ``(C) drafting long-term energy transmission line plans for 

 such insular areas with the objective that the maximum 

 percentage feasible of electric power transmission and 

 distribution lines in each insular area be protected from damage 

 caused by hurricanes and typhoons.

 ``(2) In carrying out this subsection, the Secretary of Energy shall 

identify and evaluate the strategies or projects with the greatest 

potential for reducing the dependence on imported fossil fuels as used 

for the generation of electricity, including strategies and projects 

for--

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 ``(A) improved supply-side efficiency of centralized 

 electrical generation, transmission, and distribution systems;

 ``(B) improved demand-side management through--

 ``(i) the application of established standards for 

 energy efficiency for appliances;

 ``(ii) the conduct of energy audits for business and 

 industrial customers; and

 ``(iii) the use of energy savings performance 

 contracts;

 ``(C) increased use of renewable energy, including--

 ``(i) solar thermal energy for electric generation;

 ``(ii) solar thermal energy for water heating in 

 large buildings, such as hotels, hospitals, government 

 buildings, and residences;

 ``(iii) photovoltaic energy;

 ``(iv) wind energy;

 ``(v) hydroelectric energy;

 ``(vi) wave energy;

 ``(vii) energy from ocean thermal resources, 

 including ocean thermal-cooling for community air 

 conditioning;

 ``(viii) water vapor condensation for the production 

 of potable water;

 ``(ix) fossil fuel and renewable hybrid electrical 

 generation systems; and

 ``(x) other strategies or projects that the 

 Secretary may identify as having significant potential; 

 and

 ``(D) fuel substitution and minimization with indigenous 

 biofuels, such as coconut oil.

 ``(3) In carrying out this subsection, for each insular area with a 

significant need for distributed generation, the Secretary of Energy 

shall identify and evaluate the most promising strategies and projects 

described in subparagraphs (C) and (D) of paragraph (2) for meeting that 

need.

 ``(4) In assessing the potential of any strategy or project under 

paragraphs (2) and (3), the Secretary of Energy shall consider--

 ``(A) the estimated cost of the power or energy to be 

 produced, including--

 ``(i) any additional costs associated with the 

 distribution of the generation; and

[[Page 119 STAT. 681]]

 ``(ii) the long-term availability of the generation 

 source;

 ``(B) the capacity of the local electrical utility to 

 manage, operate, and maintain any project that may be 

 undertaken; and

 ``(C) other factors the Secretary of Energy considers to be 

 appropriate.

 ``(5) <<NOTE: Deadline.>> Not later than 1 year after the date of 

enactment of this subsection, the Secretary of the Interior shall submit 

to the Committee on Energy and Natural Resources of the Senate, the 

Committee on Resources of the House of Representatives, and the 

Committee on Energy and Commerce of the House of Representatives, the 

updated plans for each insular area required by this subsection.''; and

 (4) by amending subsection (g)(4) to read as follows:

 ``(4) Power line grants for insular areas.--

 ``(A) In general.--The Secretary of the Interior is 

 authorized to make grants to governments of insular 

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 areas of the United States to carry out eligible 

 projects to protect electric power transmission and 

 distribution lines in such insular areas from damage 

 caused by hurricanes and typhoons.

 ``(B) Eligible projects.--The Secretary of the 

 Interior may award grants under subparagraph (A) only to 

 governments of insular areas of the United States that 

 submit written project plans to the Secretary for 

 projects that meet the following criteria:

 ``(i) The project is designed to protect 

 electric power transmission and distribution lines 

 located in 1 or more of the insular areas of the 

 United States from damage caused by hurricanes and 

 typhoons.

 ``(ii) The project is likely to substantially 

 reduce the risk of future damage, hardship, loss, 

 or suffering.

 ``(iii) The project addresses 1 or more 

 problems that have been repetitive or that pose a 

 significant risk to public health and safety.

 ``(iv) The project is not likely to cost more 

 than the value of the reduction in direct damage 

 and other negative impacts that the project is 

 designed to prevent or mitigate. The cost benefit 

 analysis required by this criterion shall be 

 computed on a net present value basis.

 ``(v) The project design has taken into 

 consideration long-term changes to the areas and 

 persons it is designed to protect and has 

 manageable future maintenance and modification 

 requirements.

 ``(vi) The project plan includes an analysis 

 of a range of options to address the problem it is 

 designed to prevent or mitigate and a 

 justification for the selection of the project in 

 light of that analysis.

 ``(vii) The applicant has demonstrated to the 

 Secretary that the matching funds required by 

 subparagraph (D) are available.

 ``(C) Priority.--When making grants under this 

 paragraph, the Secretary of the Interior shall give 

 priority to grants for projects which are likely to--

 ``(i) have the greatest impact on reducing 

 future disaster losses; and

[[Page 119 STAT. 682]]

 ``(ii) best conform with plans that have been 

 approved by the Federal Government or the 

 government of the insular area where the project 

 is to be carried out for development or hazard 

 mitigation for that insular area.

 ``(D) Matching requirement.--The Federal share of 

 the cost for a project for which a grant is provided 

 under this paragraph shall not exceed 75 percent of the 

 total cost of that project. The non-Federal share of the 

 cost may be provided in the form of cash or services.

 ``(E) Treatment of funds for certain purposes.--

 Grants provided under this paragraph shall not be 

 considered as income, a resource, or a duplicative 

 program when determining eligibility or benefit levels 

 for Federal major disaster and emergency assistance.

 ``(F) Authorization of appropriations.--There are 

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 authorized to be appropriated to carry out this 

 paragraph $6,000,000 for each fiscal year beginning 

 after the date of the enactment of this paragraph.''.

SEC. 252. <<NOTE: 42 USC 15891.>> PROJECTS ENHANCING INSULAR ENERGY 

 INDEPENDENCE.

 (a) Project Feasibilty Studies.--

 (1) In general.--On a request described in paragraph (2), 

 the Secretary shall conduct a feasibility study of a project to 

 implement a strategy or project identified in the plans 

 submitted to Congress pursuant to section 604 of the Act 

 entitled ``An Act to authorize appropriations for certain 

 insular areas of the United States, and for other purposes'', 

 approved December 24, 1980 (48 U.S.C. 1492), as having the 

 potential to--

 (A) significantly reduce the dependence of an 

 insular area on imported fossil fuels; or

 (B) provide needed distributed generation to an 

 insular area.

 (2) Request.--The Secretary shall conduct a feasibility 

 study under paragraph (1) on--

 (A) the request of an electric utility located in an 

 insular area that commits to fund at least 10 percent of 

 the cost of the study; and

 (B) if the electric utility is located in the 

 Federated States of Micronesia, the Republic of the 

 Marshall Islands, or the Republic of Palau, written 

 support for that request by the President or the 

 Ambassador of the affected freely associated state.

 (3) Consultation.--The Secretary shall consult with regional 

 utility organizations in--

 (A) conducting feasibility studies under paragraph 

 (1); and

 (B) determining the feasibility of potential 

 projects.

 (4) Feasibility.--For the purpose of a feasibility study 

 under paragraph (1), a project shall be determined to be 

 feasible if the project would significantly reduce the 

 dependence of an insular area on imported fossil fuels, or 

 provide needed distributed generation to an insular area, at a 

 reasonable cost.

 (b) Implementation.--

 (1) In general.--On a determination by the Secretary (in 

 consultation with the Secretary of the Interior) that a project

[[Page 119 STAT. 683]]

 is feasible under subsection (a) and a commitment by an electric 

 utility to operate and maintain the project, the Secretary may 

 provide such technical and financial assistance as the Secretary 

 determines is appropriate for the implementation of the project.

 (2) Regional utility organizations.--In providing assistance 

 under paragraph (1), the Secretary shall consider providing the 

 assistance through regional utility organizations.

 (c) Authorization of Appropriations.--

 (1) In general.--There are authorized to be appropriated to 

 the Secretary--

 (A) $500,000 for each fiscal year for project 

 feasibility studies under subsection (a); and

 (B) $4,000,000 for each fiscal year for project 

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 implementation under subsection (b).

 (2) Limitation of funds received by insular areas.--No 

 insular area may receive, during any 3-year period, more than 20 

 percent of the total funds made available during that 3-year 

 period under subparagraphs (A) and (B) of paragraph (1) unless 

 the Secretary determines that providing funding in excess of 

 that percentage best advances existing opportunities to meet the 

 objectives of this section.

 TITLE III--OIL AND GAS

 Subtitle A--Petroleum Reserve and Home Heating Oil

SEC. 301. PERMANENT AUTHORITY TO OPERATE THE STRATEGIC PETROLEUM RESERVE 

 AND OTHER ENERGY PROGRAMS.

 (a) Amendment to Title I of the Energy Policy and Conservation 

Act.--Title I of the Energy Policy and Conservation Act (42 U.S.C. 6212 

et seq.) is amended--

 (1) by striking section 166 (42 U.S.C. 6246) and inserting 

 the following:

 ``authorization of appropriations

 ``Sec. 166. There are authorized to be appropriated to the Secretary 

such sums as are necessary to carry out this part and part D, to remain 

available until expended.'';

 (2) by striking section 186 (42 U.S.C. 6250e); and

 (3) by striking part E (42 U.S.C. 6251).

 (b) Amendment to Title II of the Energy Policy and Conservation 

Act.--Title II of the Energy Policy and Conservation Act (42 U.S.C. 6271 

et seq.) is amended--

 (1) by inserting before section 273 (42 U.S.C. 6283) the 

 following:

 ``PART C--SUMMER FILL AND FUEL BUDGETING PROGRAMS'';

 (2) by striking section 273(e) (42 U.S.C. 6283(e)); and

 (3) by striking part D (42 U.S.C. 6285).

 (c) Technical Amendments.--The table of contents for the Energy 

Policy and Conservation Act is amended--

[[Page 119 STAT. 684]]

 (1) by inserting after the items relating to part C of title 

 I the following:

 ``Part D--Northeast Home Heating Oil Reserve

``Sec. 181. Establishment.

``Sec. 182. Authority.

``Sec. 183. Conditions for release; plan.

``Sec. 184. Northeast Home Heating Oil Reserve Account.

``Sec. 185. Exemptions.'';

 (2) by amending the items relating to part C of title II to 

 read as follows:

 ``Part C--Summer Fill and Fuel Budgeting Programs

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``Sec. 273. Summer fill and fuel budgeting programs.'';

 and

 (3) by striking the items relating to part D of title II.

 (d) Amendment to the Energy Policy and Conservation Act.--Section 

183(b)(1) of the Energy Policy and Conservation Act (42 U.S.C. 

6250b(b)(1)) is amended by striking ``by more'' and all that follows 

through ``mid-October through March'' and inserting ``by more than 60 

percent over its 5-year rolling average for the months of mid-October 

through March (considered as a heating season average)''.

 (e) Fill <<NOTE: 42 USC 6240 note.>> Strategic Petroleum Reserve to 

Capacity.--

 (1) In general.--The Secretary shall, as expeditiously as 

 practicable, without incurring excessive cost or appreciably 

 affecting the price of petroleum products to consumers, acquire 

 petroleum in quantities sufficient to fill the Strategic 

 Petroleum Reserve to the 1,000,000,000-barrel capacity 

 authorized under section 154(a) of the Energy Policy and 

 Conservation Act (42 U.S.C. 6234(a)), in accordance with the 

 sections 159 and 160 of that Act (42 U.S.C. 6239, 6240).

 (2) Procedures.--

 (A) Amendment.--Section 160 of the Energy Policy and 

 Conservation Act (42 U.S.C. 6240) is amended by 

 inserting after subsection (b) the following new 

 subsection:

 ``(c) Procedures.--The <<NOTE: Public 

information. Notice.>> Secretary shall develop, with public notice and 

opportunity for comment, procedures consistent with the objectives of 

this section to acquire petroleum for the Reserve. Such procedures shall 

take into account the need to--

 ``(1) maximize overall domestic supply of crude oil 

 (including quantities stored in private sector inventories);

 ``(2) avoid incurring excessive cost or appreciably 

 affecting the price of petroleum products to consumers;

 ``(3) minimize the costs to the Department of the Interior 

 and the Department of Energy in acquiring such petroleum 

 products (including foregone revenues to the Treasury when 

 petroleum products for the Reserve are obtained through the 

 royalty-in-kind program);

 ``(4) protect national security;

 ``(5) avoid adversely affecting current and futures prices, 

 supplies, and inventories of oil; and

 ``(6) address other factors that the Secretary determines to 

 be appropriate.''.

 (B) Review of <<NOTE: 42 USC 6240 note.>> requests 

 for deferrals of scheduled deliveries.--The procedures 

 developed under section 160(c) of the Energy Policy and 

 Conservation Act, as added by subparagraph (A), shall 

 include procedures and criteria

[[Page 119 STAT. 685]]

 for the review of requests for the deferrals of 

 scheduled deliveries.

 (C) Deadlines.--The Secretary shall--

 (i) propose the procedures required under the 

 amendment made by subparagraph (A) not later than 

 120 days after the date of enactment of this Act;

 (ii) promulgate the procedures not later than 

 180 days after the date of enactment of this Act; 

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 and

 (iii) comply with the procedures in acquiring 

 petroleum for the Reserve effective beginning on 

 the date that is 180 days after the date of 

 enactment of this Act.

SEC. 302. NATIONAL OILHEAT RESEARCH ALLIANCE.

 Section 713 of the Energy Act of 2000 (Public Law 106-469; 42 U.S.C. 

6201 note) is amended by striking ``4'' and inserting ``9''.

SEC. 303. <<NOTE: Deadline.>> SITE SELECTION.

 Not later than 1 year after the date of enactment of this Act, the 

Secretary shall complete a proceeding to select, from sites that the 

Secretary has previously studied, sites necessary to enable acquisition 

by the Secretary of the full authorized volume of the Strategic 

Petroleum Reserve. In such proceeding, the Secretary shall first 

consider and give preference to the five sites which the Secretary 

previously assessed in the Draft Environmental Impact Statement, DOE/

EIS-0165-D. However, the Secretary in his discretion may select other 

sites as proposed by a State where a site has been previously studied by 

the Secretary to meet the full authorized volume of the Strategic 

Petroleum Reserve.

 Subtitle B--Natural Gas

SEC. 311. EXPORTATION OR IMPORTATION OF NATURAL GAS.

 (a) Scope of Natural Gas Act.--Section 1(b) of the Natural Gas Act 

(15 U.S.C. 717(b)) is amended by inserting ``and to the importation or 

exportation of natural gas in foreign commerce and to persons engaged in 

such importation or exportation,'' after ``such transportation or 

sale,''.

 (b) Definition.--Section 2 of the Natural Gas Act (15 U.S.C. 717a) 

is amended by adding at the end the following new paragraph:

 ``(11) `LNG terminal' includes all natural gas facilities 

 located onshore or in State waters that are used to receive, 

 unload, load, store, transport, gasify, liquefy, or process 

 natural gas that is imported to the United States from a foreign 

 country, exported to a foreign country from the United States, 

 or transported in interstate commerce by waterborne vessel, but 

 does not include--

 ``(A) waterborne vessels used to deliver natural gas 

 to or from any such facility; or

 ``(B) any pipeline or storage facility subject to 

 the jurisdiction of the Commission under section 7.''.

 (c) Authorization for Siting, Construction, Expansion, or Operation 

of LNG Terminals.--(1) The title for section 3 of the Natural Gas Act 

(15 U.S.C. 717b) is amended by inserting ``; lng terminals'' after 

``exportation or importation of natural gas''.

[[Page 119 STAT. 686]]

 (2) Section 3 of the Natural Gas Act (15 U.S.C. 717b) is amended by 

adding at the end the following:

 ``(d) Except as specifically provided in this Act, nothing in this 

Act affects the rights of States under--

 ``(1) the Coastal Zone Management Act of 1972 (16 U.S.C. 

 1451 et seq.);

 ``(2) the Clean Air Act (42 U.S.C. 7401 et seq.); or

 ``(3) the Federal Water Pollution Control Act (33 U.S.C. 

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 1251 et seq.).

 ``(e)(1) The Commission shall have the exclusive authority to 

approve or deny an application for the siting, construction, expansion, 

or operation of an LNG terminal. Except as specifically provided in this 

Act, nothing in this Act is intended to affect otherwise applicable law 

related to any Federal agency's authorities or responsibilities related 

to LNG terminals.

 ``(2) Upon the filing of any application to site, construct, expand, 

or operate an LNG terminal, the Commission shall--

 ``(A) set the matter for hearing;

 ``(B) <<NOTE: Notice.>> give reasonable notice of the 

 hearing to all interested persons, including the State 

 commission of the State in which the LNG terminal is located 

 and, if not the same, the Governor-appointed State agency 

 described in section 3A;

 ``(C) decide the matter in accordance with this subsection; 

 and

 ``(D) issue or deny the appropriate order accordingly.

 ``(3)(A) Except as provided in subparagraph (B), the Commission may 

approve an application described in paragraph (2), in whole or part, 

with such modifications and upon such terms and conditions as the 

Commission find necessary or appropriate.

 ``(B) Before January 1, 2015, the Commission shall not--

 ``(i) deny an application solely on the basis that the 

 applicant proposes to use the LNG terminal exclusively or 

 partially for gas that the applicant or an affiliate of the 

 applicant will supply to the facility; or

 ``(ii) condition an order on--

 ``(I) a requirement that the LNG terminal offer 

 service to customers other than the applicant, or any 

 affiliate of the applicant, securing the order;

 ``(II) any regulation of the rates, charges, terms, 

 or conditions of service of the LNG terminal; or

 ``(III) a requirement to file with the Commission 

 schedules or contracts related to the rates, charges, 

 terms, or conditions of service of the LNG terminal.

 ``(C) <<NOTE: Termination date.>> Subparagraph (B) shall cease to 

have effect on January 1, 2030.

 ``(4) An order issued for an LNG terminal that also offers service 

to customers on an open access basis shall not result in subsidization 

of expansion capacity by existing customers, degradation of service to 

existing customers, or undue discrimination against existing customers 

as to their terms or conditions of service at the facility, as all of 

those terms are defined by the Commission.

 ``(f)(1) In this subsection, the term `military installation'--

 ``(A) means a base, camp, post, range, station, yard, 

 center, or homeport facility for any ship or other activity 

 under the jurisdiction of the Department of Defense, including 

 any leased facility, that is located within a State, the 

 District of Columbia, or any territory of the United States; and

[[Page 119 STAT. 687]]

 ``(B) does not include any facility used primarily for civil 

 works, rivers and harbors projects, or flood control projects, 

 as determined by the Secretary of Defense.

 ``(2) <<NOTE: Memorandum.>> The Commission shall enter into a 

memorandum of understanding with the Secretary of Defense for the 

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purpose of ensuring that the Commission coordinate and consult with the 

Secretary of Defense on the siting, construction, expansion, or 

operation of liquefied natural gas facilities that may affect an active 

military installation.

 ``(3) The Commission shall obtain the concurrence of the Secretary 

of Defense before authorizing the siting, construction, expansion, or 

operation of liquefied natural gas facilities affecting the training or 

activities of an active military installation.''.

 (d) LNG Terminal State and Local Safety Concerns.--After section 3 

of the Natural Gas Act (15 U.S.C. 717b) insert the following:

 ``state and local safety considerations

 ``Sec. 3A. (a) <<NOTE: Regulations. Deadline. 15 USC 717b-1.>> The 

Commission shall promulgate regulations on the National Environmental 

Policy Act of 1969 (42 U.S.C. 4321 et seq.) pre-filing process within 60 

days after the date of enactment of this section. An applicant shall 

comply with pre-filing process required under the National Environmental 

Policy Act of 1969 prior to filing an application with the Commission. 

The regulations shall require that the pre-filing process commence at 

least 6 months prior to the filing of an application for authorization 

to construct an LNG terminal and encourage applicants to cooperate with 

State and local officials.

 ``(b) The Governor of a State in which an LNG terminal is proposed 

to be located shall designate the appropriate State agency for the 

purposes of consulting with the Commission regarding an application 

under section 3. The Commission shall consult with such State agency 

regarding State and local safety considerations prior to issuing an 

order pursuant to section 3. For the purposes of this section, State and 

local safety considerations include--

 ``(1) the kind and use of the facility;

 ``(2) the existing and projected population and demographic 

 characteristics of the location;

 ``(3) the existing and proposed land use near the location;

 ``(4) the natural and physical aspects of the location;

 ``(5) the emergency response capabilities near the facility 

 location; and

 ``(6) the need to encourage remote siting.

 ``(c) The State agency may furnish an advisory report on State and 

local safety considerations to the Commission with respect to an 

application no later than 30 days after the application was filed with 

the Commission. Before issuing an order authorizing an applicant to 

site, construct, expand, or operate an LNG terminal, the Commission 

shall review and respond specifically to the issues raised by the State 

agency described in subsection (b) in the advisory 

report. <<NOTE: Applicability.>> This subsection shall apply to any 

application filed after the date of enactment of the Energy Policy Act 

of 2005. A <<NOTE: Deadline. Reports.>> State agency has 30 days after 

such date of enactment to file an advisory report related to any 

applications pending at the Commission as of such date of enactment.

 ``(d) The State commission of the State in which an LNG terminal is 

located may, after the terminal is operational, conduct

[[Page 119 STAT. 688]]

safety inspections in conformance with Federal regulations and 

guidelines with respect to the LNG terminal upon written notice to the 

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Commission. The State commission may notify the Commission of any 

alleged safety violations. <<NOTE: Notification.>> The Commission shall 

transmit information regarding such allegations to the appropriate 

Federal agency, which shall take appropriate action and notify the State 

commission.

 ``(e)(1) In any order authorizing an LNG terminal the Commission 

shall require the LNG terminal operator to develop an Emergency Response 

Plan. The Emergency Response Plan shall be prepared in consultation with 

the United States Coast Guard and State and local agencies and be 

approved by the Commission prior to any final approval to begin 

construction. The Plan shall include a cost-sharing plan.

 ``(2) A cost-sharing plan developed under paragraph (1) shall 

include a description of any direct cost reimbursements that the 

applicant agrees to provide to any State and local agencies with 

responsibility for security and safety--

 ``(A) at the LNG terminal; and

 ``(B) in proximity to vessels that serve the facility.''.

SEC. 312. NEW NATURAL GAS STORAGE FACILITIES.

 Section 4 of the Natural Gas Act (15 U.S.C. 717c) is amended by 

adding at the end the following:

 ``(f)(1) In exercising its authority under this Act or the Natural 

Gas Policy Act of 1978 (15 U.S.C. 3301 et seq.), the Commission may 

authorize a natural gas company (or any person that will be a natural 

gas company on completion of any proposed construction) to provide 

storage and storage-related services at market-based rates for new 

storage capacity related to a specific facility placed in service after 

the date of enactment of the Energy Policy Act of 2005, notwithstanding 

the fact that the company is unable to demonstrate that the company 

lacks market power, if the Commission determines that--

 ``(A) market-based rates are in the public interest and 

 necessary to encourage the construction of the storage capacity 

 in the area needing storage services; and

 ``(B) customers are adequately protected.

 ``(2) The Commission shall ensure that reasonable terms and 

conditions are in place to protect consumers.

 ``(3) If the Commission authorizes a natural gas company to charge 

market-based rates under this subsection, the Commission shall review 

periodically whether the market-based rate is just, reasonable, and not 

unduly discriminatory or preferential.''.

SEC. 313. PROCESS COORDINATION; HEARINGS; RULES OF PROCEDURE.

 (a) In General.--Section 15 of the Natural Gas Act (15 U.S.C. 717n) 

is amended--

 (1) by striking the section heading and inserting ``process 

 coordination; hearings; rules of procedure'';

 (2) by redesignating subsections (a) and (b) as subsections 

 (e) and (f), respectively; and

 (3) by striking ``sec. 15.'' and inserting the following:

 ``Sec. 15.(a) In this section, the term `Federal authorization'--

 ``(1) means any authorization required under Federal law 

 with respect to an application for authorization under section

[[Page 119 STAT. 689]]

 3 or a certificate of public convenience and necessity under 

 section 7; and

 ``(2) includes any permits, special use authorizations, 

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 certifications, opinions, or other approvals as may be required 

 under Federal law with respect to an application for 

 authorization under section 3 or a certificate of public 

 convenience and necessity under section 7.

 ``(b) Designation as Lead Agency.--

 ``(1) In general.--The Commission shall act as the lead 

 agency for the purposes of coordinating all applicable Federal 

 authorizations and for the purposes of complying with the 

 National Environmental Policy Act of 1969 (42 U.S.C. 4321 et 

 seq.).

 ``(2) Other agencies.--Each Federal and State agency 

 considering an aspect of an application for Federal 

 authorization shall cooperate with the Commission and comply 

 with the deadlines established by the Commission.

 ``(c) Schedule.--

 ``(1) Commission authority to set schedule.--The Commission 

 shall establish a schedule for all Federal authorizations. In 

 establishing the schedule, the Commission shall--

 ``(A) ensure expeditious completion of all such 

 proceedings; and

 ``(B) comply with applicable schedules established 

 by Federal law.

 ``(2) Failure to meet schedule.--If a Federal or State 

 administrative agency does not complete a proceeding for an 

 approval that is required for a Federal authorization in 

 accordance with the schedule established by the Commission, the 

 applicant may pursue remedies under section 19(d).

 ``(d) Consolidated Record.--The Commission shall, with the 

cooperation of Federal and State administrative agencies and officials, 

maintain a complete consolidated record of all decisions made or actions 

taken by the Commission or by a Federal administrative agency or officer 

(or State administrative agency or officer acting under delegated 

Federal authority) with respect to any Federal authorization. Such 

record shall be the record for--

 ``(1) appeals or reviews under the Coastal Zone Management 

 Act of 1972 (16 U.S.C. 1451 et seq.), provided that the record 

 may be supplemented as expressly provided pursuant to section 

 319 of that Act; or

 ``(2) judicial review under section 19(d) of decisions made 

 or actions taken of Federal and State administrative agencies 

 and officials, provided that, if the Court determines that the 

 record does not contain sufficient information, the Court may 

 remand the proceeding to the Commission for further development 

 of the consolidated record.''.

 (b) Judicial Review.--Section 19 of the Natural Gas Act (15 U.S.C. 

717r) is amended by adding at the end the following:

 ``(d) Judicial Review.--

 ``(1) In general.--The United States Court of Appeals for 

 the circuit in which a facility subject to section 3 or section 

 7 is proposed to be constructed, expanded, or operated shall 

 have original and exclusive jurisdiction over any civil action 

 for the review of an order or action of a Federal agency (other 

 than the Commission) or State administrative agency acting 

 pursuant to Federal law to issue, condition, or deny any permit,

[[Page 119 STAT. 690]]

 license, concurrence, or approval (hereinafter collectively 

 referred to as `permit') required under Federal law, other than 

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 the Coastal Zone Management Act of 1972 (16 U.S.C. 1451 et 

 seq.).

 ``(2) Agency delay.--The United States Court of Appeals for 

 the District of Columbia shall have original and exclusive 

 jurisdiction over any civil action for the review of an alleged 

 failure to act by a Federal agency (other than the Commission) 

 or State administrative agency acting pursuant to Federal law to 

 issue, condition, or deny any permit required under Federal law, 

 other than the Coastal Zone Management Act of 1972 (16 U.S.C. 

 1451 et seq.), for a facility subject to section 3 or section 7. 

 The failure of an agency to take action on a permit required 

 under Federal law, other than the Coastal Zone Management Act of 

 1972, in accordance with the Commission schedule established 

 pursuant to section 15(c) shall be considered inconsistent with 

 Federal law for the purposes of paragraph (3).

 ``(3) Court action.--If the Court finds that such order or 

 action is inconsistent with the Federal law governing such 

 permit and would prevent the construction, expansion, or 

 operation of the facility subject to section 3 or section 7, the 

 Court shall remand the proceeding to the agency to take 

 appropriate action consistent with the order of the Court. If 

 the Court remands the order or action to the Federal or State 

 agency, the Court shall set a reasonable schedule and deadline 

 for the agency to act on remand.

 ``(4) Commission action.--For any action described in this 

 subsection, the Commission shall file with the Court the 

 consolidated record of such order or action to which the appeal 

 hereunder relates.

 ``(5) Expedited review.--The Court shall set any action 

 brought under this subsection for expedited consideration.''.

SEC. 314. PENALTIES.

 (a) Criminal Penalties.--

 (1) Natural gas act.--Section 21 of the Natural Gas Act (15 

 U.S.C. 717t) is amended--

 (A) in subsection (a)--

 (i) by striking ``$5,000'' and inserting 

 ``$1,000,000''; and

 (ii) by striking ``two years'' and inserting 

 ``5 years''; and

 (B) in subsection (b), by striking ``$500'' and 

 inserting ``$50,000''.

 (2) Natural gas policy act of 1978.--Section 504(c) of the 

 Natural Gas Policy Act of 1978 (15 U.S.C. 3414(c)) is amended--

 (A) in paragraph (1)--

 (i) in subparagraph (A), by striking 

 ``$5,000'' and inserting ``$1,000,000''; and

 (ii) in subparagraph (B), by striking ``two 

 years'' and inserting ``5 years''; and

 (B) in paragraph (2), by striking ``$500 for each 

 violation'' and inserting ``$50,000 for each day on 

 which the offense occurs''.

 (b) Civil Penalties.--

[[Page 119 STAT. 691]]

 (1) Natural gas act.--The Natural Gas Act (15 U.S.C. 717 et 

 seq.) is amended--

 (A) <<NOTE: 15 USC 717u-717w.>> by redesignating 

 sections 22 through 24 as sections 24 through 26, 

 respectively; and

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 (B) by inserting after section 21 (15 U.S.C. 717t) 

 the following:

 ``civil penalty authority

 ``Sec. 22. (a) <<NOTE: 15 USC 717t-1.>> Any person that violates 

this Act, or any rule, regulation, restriction, condition, or order made 

or imposed by the Commission under authority of this Act, shall be 

subject to a civil penalty of not more than $1,000,000 per day per 

violation for as long as the violation continues.

 ``(b) The penalty shall be assessed by the Commission after notice 

and opportunity for public hearing.

 ``(c) In determining the amount of a proposed penalty, the 

Commission shall take into consideration the nature and seriousness of 

the violation and the efforts to remedy the violation.''.

 (2) Natural gas policy act of 1978.--Section 504(b)(6)(A) of 

 the Natural Gas Policy Act of 1978 (15 U.S.C. 3414(b)(6)(A)) is 

 amended--

 (A) in clause (i), by striking ``$5,000'' and 

 inserting ``$1,000,000''; and

 (B) in clause (ii), by striking ``$25,000'' and 

 inserting ``$1,000,000''.

SEC. 315. MARKET MANIPULATION.

 The Natural Gas Act is amended by inserting after section 4 (15 

U.S.C. 717c) the following:

 ``prohibition on market manipulation

 ``Sec. 4A. <<NOTE: 15 USC 717c-1.>> It shall be unlawful for any 

entity, directly or indirectly, to use or employ, in connection with the 

purchase or sale of natural gas or the purchase or sale of 

transportation services subject to the jurisdiction of the Commission, 

any manipulative or deceptive device or contrivance (as those terms are 

used in section 10(b) of the Securities Exchange Act of 1934 (15 U.S.C. 

78j(b))) in contravention of such rules and regulations as the 

Commission may prescribe as necessary in the public interest or for the 

protection of natural gas ratepayers. Nothing in this section shall be 

construed to create a private right of action.''.

SEC. 316. NATURAL GAS MARKET TRANSPARENCY RULES.

 The Natural Gas Act (15 U.S.C. 717 et seq.) is amended by inserting 

after section 22 the following:

 ``natural gas market transparency rules

 ``Sec. 23. (a)(1) <<NOTE: 15 USC 717t-2.>> The Commission is 

directed to facilitate price transparency in markets for the sale or 

transportation of physical natural gas in interstate commerce, having 

due regard for the public interest, the integrity of those markets, fair 

competition, and the protection of consumers.

 ``(2) The Commission may prescribe such rules as the Commission 

determines necessary and appropriate to carry out the purposes of this 

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section. The rules shall provide for the dissemination, on a timely 

basis, of information about the availability and prices

[[Page 119 STAT. 692]]

of natural gas sold at wholesale and in interstate commerce to the 

Commission, State commissions, buyers and sellers of wholesale natural 

gas, and the public.

 ``(3) The Commission may--

 ``(A) obtain the information described in paragraph (2) from 

 any market participant; and

 ``(B) rely on entities other than the Commission to receive 

 and make public the information, subject to the disclosure rules 

 in subsection (b).

 ``(4) In carrying out this section, the Commission shall consider 

the degree of price transparency provided by existing price publishers 

and providers of trade processing services, and shall rely on such 

publishers and services to the maximum extent possible. The Commission 

may establish an electronic information system if it determines that 

existing price publications are not adequately providing price discovery 

or market transparency.

 ``(b)(1) Rules described in subsection (a)(2), if adopted, shall 

exempt from disclosure information the Commission determines would, if 

disclosed, be detrimental to the operation of an effective market or 

jeopardize system security.

 ``(2) In determining the information to be made available under this 

section and the time to make the information available, the Commission 

shall seek to ensure that consumers and competitive markets are 

protected from the adverse effects of potential collusion or other 

anticompetitive behaviors that can be facilitated by untimely public 

disclosure of transaction-specific information.

 ``(c)(1) <<NOTE: Deadline. Memorandum.>> Within 180 days of 

enactment of this section, the Commission shall conclude a memorandum of 

understanding with the Commodity Futures Trading Commission relating to 

information sharing, which shall include, among other things, provisions 

ensuring that information requests to markets within the respective 

jurisdiction of each agency are properly coordinated to minimize 

duplicative information requests, and provisions regarding the treatment 

of proprietary trading information.

 ``(2) Nothing in this section may be construed to limit or affect 

the exclusive jurisdiction of the Commodity Futures Trading Commission 

under the Commodity Exchange Act (7 U.S.C. 1 et seq.).

 ``(d)(1) The Commission shall not condition access to interstate 

pipeline transportation on the reporting requirements of this section.

 ``(2) The Commission shall not require natural gas producers, 

processors, or users who have a de minimis market presence to comply 

with the reporting requirements of this section.

 ``(e)(1) Except as provided in paragraph (2), no person shall be 

subject to any civil penalty under this section with respect to any 

violation occurring more than 3 years before the date on which the 

person is provided notice of the proposed penalty under section 22(b).

 ``(2) Paragraph (1) shall not apply in any case in which the 

Commission finds that a seller that has entered into a contract for the 

transportation or sale of natural gas subject to the jurisdiction of the 

Commission has engaged in fraudulent market manipulation activities 

materially affecting the contract in violation of section 4A.''.

[[Page 119 STAT. 693]]

SEC. 317. FEDERAL-STATE LIQUEFIED NATURAL GAS FORUMS.

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 (a) In General.--Not <<NOTE: Deadline.>> later than 1 year after the 

date of enactment of this Act, the Secretary, in cooperation and 

consultation with the Secretary of Transportation, the Secretary of 

Homeland Security, the Federal Energy Regulatory Commission, and the 

Governors of the Coastal States, shall convene not less than 3 forums on 

liquefied natural gas.

 (b) Requirements.--The forums shall--

 (1) be located in areas where liquefied natural gas 

 facilities are under consideration;

 (2) be designed to foster dialogue among Federal officials, 

 State and local officials, the general public, independent 

 experts, and industry representatives; and

 (3) at a minimum, provide an opportunity for public 

 education and dialogue on--

 (A) the role of liquefied natural gas in meeting 

 current and future United States energy supply 

 requirements and demand, in the context of the full 

 range of energy supply options;

 (B) the Federal and State siting and permitting 

 processes;

 (C) the potential risks and rewards associated with 

 importing liquefied natural gas;

 (D) the Federal safety and environmental 

 requirements (including regulations) applicable to 

 liquefied natural gas;

 (E) prevention, mitigation, and response strategies 

 for liquefied natural gas hazards; and

 (F) additional issues as appropriate.

 (c) Purpose.--The purpose of the forums shall be to identify and 

develop best practices for addressing the issues and challenges 

associated with liquefied natural gas imports, building on existing 

cooperative efforts.

 (d) Authorization of Appropriations.--There are authorized to be 

appropriated such sums as are necessary to carry out this section.

SEC. 318. PROHIBITION OF TRADING AND SERVING BY CERTAIN INDIVIDUALS.

 Section 20 of the Natural Gas Act (15 U.S.C. 717s) is amended by 

adding at the end the following:

 ``(d) In any proceedings under subsection (a), the court may 

prohibit, conditionally or unconditionally, and permanently or for such 

period of time as the court determines, any individual who is engaged or 

has engaged in practices constituting a violation of section 4A 

(including related rules and regulations) from--

 ``(1) acting as an officer or director of a natural gas 

 company; or

 ``(2) engaging in the business of--

 ``(A) the purchasing or selling of natural gas; or

 ``(B) the purchasing or selling of transmission 

 services subject to the jurisdiction of the 

 Commission.''.

[[Page 119 STAT. 694]]

 Subtitle C--Production

SEC. 321. OUTER CONTINENTAL SHELF PROVISIONS.

 (a) Storage on the Outer Continental Shelf.--Section 5(a)(5) of the 

Outer Continental Shelf Lands Act (43 U.S.C. 1334(a)(5)) is amended by 

inserting ``from any source'' after ``oil and gas''.

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 (b) Natural Gas Defined.--Section 3(13) of the Deepwater Port Act of 

1974 (33 U.S.C. 1502(13)) is amended by adding at the end before the 

semicolon the following: ``, natural gas liquids, liquefied petroleum 

gas, and condensate recovered from natural gas''.

SEC. 322. HYDRAULIC FRACTURING.

 Paragraph (1) of section 1421(d) of the Safe Drinking Water Act (42 

U.S.C. 300h(d)) is amended to read as follows:

 ``(1) Underground injection.--The term `underground 

 injection'--

 ``(A) means the subsurface emplacement of fluids by 

 well injection; and

 ``(B) excludes--

 ``(i) the underground injection of natural gas 

 for purposes of storage; and

 ``(ii) the underground injection of fluids or 

 propping agents (other than diesel fuels) pursuant 

 to hydraulic fracturing operations related to oil, 

 gas, or geothermal production activities.''.

SEC. 323. OIL AND GAS EXPLORATION AND PRODUCTION DEFINED.

 Section 502 of the Federal Water Pollution Control Act (33 U.S.C. 

1362) is amended by adding at the end the following:

 ``(24) Oil and gas exploration and production.--The term 

 `oil and gas exploration, production, processing, or treatment 

 operations or transmission facilities' means all field 

 activities or operations associated with exploration, 

 production, processing, or treatment operations, or transmission 

 facilities, including activities necessary to prepare a site for 

 drilling and for the movement and placement of drilling 

 equipment, whether or not such field activities or operations 

 may be considered to be construction activities.''.

 Subtitle D--Naval Petroleum Reserve

SEC. 331. <<NOTE: 10 USC 7420 note.>> TRANSFER OF ADMINISTRATIVE 

 JURISDICTION AND ENVIRONMENTAL REMEDIATION, NAVAL PETROLEUM 

 RESERVE NUMBERED 2, KERN COUNTY, CALIFORNIA.

 (a) Administration <<NOTE: Effective date.>> Jurisdiction Transfer 

to Secretary of the Interior.--Effective on the date of the enactment of 

this Act, administrative jurisdiction and control over all public domain 

lands included within Naval Petroleum Reserve Numbered 2 located in Kern 

County, California (other than the lands specified in subsection (b)), 

are transferred from the Secretary to the Secretary of the Interior for 

management, subject to subsection (c), in accordance with the laws 

governing management of the public lands, and the regulations 

promulgated under such laws, including the

[[Page 119 STAT. 695]]

Mineral Leasing Act (30 U.S.C. 181 et seq.) and the Federal Land Policy 

and Management Act of 1976 (43 U.S.C. 1701 et seq.).

 (b) Exclusion of Certain Reserve Lands.--The transfer of 

administrative jurisdiction made by subsection (a) does not include the 

following lands:

 (1) That portion of Naval Petroleum Reserve Numbered 2 

 authorized for disposal under section 3403(a) of the Strom 

 Thurmond National Defense Authorization Act for Fiscal Year 1999 

 (Public Law 105-261; 10 U.S.C. 7420 note).

 (2) That portion of the surface estate of Naval Petroleum 

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 Reserve Numbered 2 conveyed to the City of Taft, California, by 

 section 333.

 (c) Purpose of Transfer.--

 (1) Production of hydrocarbon resources.--Notwithstanding 

 any other provision of law, the principal purpose of the lands 

 subject to transfer under subsection (a) is the production of 

 hydrocarbon resources, and the Secretary of the Interior shall 

 manage the lands in a fashion consistent with this purpose. In 

 managing the lands, the Secretary of the Interior shall regulate 

 operations to prevent unnecessary degradation and to provide for 

 ultimate economic recovery of the resources.

 (2) Disposal authority and surface use.--The Secretary of 

 the Interior may make disposals of lands subject to transfer 

 under subsection (a), or allow commercial or non-profit surface 

 use of such lands, not to exceed 10 acres each, so long as the 

 disposals or surface uses do not materially interfere with the 

 ultimate economic recovery of the hydrocarbon resources of such 

 lands. All revenues received from the disposal of lands under 

 this paragraph or from allowing the surface use of such lands 

 shall be deposited in the Naval Petroleum Reserve Numbered 2 

 Lease Revenue Account established by section 332.

 (d) Conforming Amendment.--Section 3403 of the Strom Thurmond 

National Defense Authorization Act for Fiscal Year 1999 (Public Law 105-

261; 10 U.S.C. 7420 note) is amended by striking subsection (b).

SEC. 332. <<NOTE: 10 USC 7420 note.>> NAVAL PETROLEUM RESERVE NUMBERED 2 

 LEASE REVENUE ACCOUNT.

 (a) Establishment.--There is established in the Treasury a special 

deposit account to be known as the ``Naval Petroleum Reserve Numbered 2 

Lease Revenue Account'' (in this section referred to as the ``lease 

revenue account''). The lease revenue account is a revolving account, 

and amounts in the lease revenue account shall be available to the 

Secretary of the Interior, without further appropriation, for the 

purposes specified in subsection (b).

 (b) Purposes of Account.--

 (1) Environmental-related costs.--The lease revenue account 

 shall be the sole and exclusive source of funds to pay for any 

 and all costs and expenses incurred by the United States for--

 (A) environmental investigations (other than any 

 environmental investigations that were conducted by the 

 Secretary before the transfer of the Naval Petroleum 

 Reserve Numbered 2 lands under section 331), 

 remediation, compliance actions, response, waste 

 management, impediments, fines or penalties, or any 

 other costs or expenses

[[Page 119 STAT. 696]]

 of any kind arising from, or relating to, conditions 

 existing on or below the Naval Petroleum Reserve 

 Numbered 2 lands, or activities occurring or having 

 occurred on such lands, on or before the date of the 

 transfer of such lands; and

 (B) any future remediation necessitated as a result 

 of pre-transfer and leasing activities on such lands.

 (2) Transition costs.--The lease revenue account shall also 

 be available for use by the Secretary of the Interior to pay for 

 transition costs incurred by the Department of the Interior 

 associated with the transfer and leasing of the Naval Petroleum 

 Reserve Numbered 2 lands.

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 (c) Funding.--The lease revenue account shall consist of the 

following:

 (1) Notwithstanding any other provision of law, for a period 

 of three years after the date of the transfer of the Naval 

 Petroleum Reserve Numbered 2 lands under section 331, the sum of 

 $500,000 per year of revenue from leases entered into before 

 that date, including bonuses, rents, royalties, and interest 

 charges collected pursuant to the Federal Oil and Gas Royalty 

 Management Act of 1982 (30 U.S.C. 1701 et. seq.), derived from 

 the Naval Petroleum Reserve Numbered 2 lands, shall be deposited 

 into the lease revenue account.

 (2) Subject to subsection (d), all revenues derived from 

 leases on Naval Petroleum Reserve Numbered 2 lands issued on or 

 after the date of the transfer of such lands, including bonuses, 

 rents, royalties, and interest charges collected pursuant to the 

 Federal Oil and Gas Royalty Management Act of 1982 (30 U.S.C. 

 1701 et seq.), shall be deposited into the lease revenue 

 account.

 (d) Limitation.--Funds in the lease revenue account shall not exceed 

$3,000,000 at any one time. Whenever funds in the lease revenue account 

are obligated or expended so that the balance in the account falls below 

that amount, lease revenues referred to in subsection (c)(2) shall be 

deposited in the account to maintain a balance of $3,000,000.

 (e) Termination of Account.--At <<NOTE: Certification.>> such time 

as the Secretary of the Interior certifies that remediation of all 

environmental contamination of Naval Petroleum Reserve Numbered 2 lands 

in existence as of the date of the transfer of such lands under section 

331 has been successfully completed, that all costs and expenses of 

investigation, remediation, compliance actions, response, waste 

management, impediments, fines, or penalties associated with 

environmental contamination of such lands in existence as of the date of 

the transfer have been paid in full, and that the transition costs of 

the Department of the Interior referred to in subsection (b)(2) have 

been paid in full, the lease revenue account shall be terminated and any 

remaining funds shall be distributed in accordance with subsection (f).

 (f) Distribution of <<NOTE: Applicability.>> Remaining Funds.--

Section 35 of the Mineral Leasing Act (30 U.S.C. 191) shall apply to the 

payment and distribution of all funds remaining in the lease revenue 

account upon its termination under subsection (e).

[[Page 119 STAT. 697]]

SEC. 333. <<NOTE: 10 USC 7420 note.>> LAND CONVEYANCE, PORTION OF NAVAL 

 PETROLEUM RESERVE NUMBERED 2, TO CITY OF TAFT, CALIFORNIA.

 (a) Conveyance.--Effective <<NOTE: Effective date.>> on the date of 

the enactment of this Act, there is conveyed to the City of Taft, 

California (in this section referred to as the ``City''), all surface 

right, title, and interest of the United States in and to a parcel of 

real property consisting of approximately 220 acres located in the NE\1/

4\, the NE\1/4\ of the NW\1/4\, and the N\1/2\ of the SE\1/4\ of the 

NW\1/4\ of section 18, township 32 south, range 24 east, Mount Diablo 

meridian, Kern County, California.

 (b) Consideration.--The conveyance under subsection (a) is made 

without the payment of consideration by the City.

 (c) Treatment of Existing Rights.--The conveyance under subsection 

(a) is subject to valid existing rights, including Federal oil and gas 

lease SAC-019577.

 (d) Treatment of Minerals.--All coal, oil, gas, and other minerals 

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within the lands conveyed under subsection (a) are reserved to the 

United States, except that the United States and its lessees, licensees, 

permittees, or assignees shall have no right of surface use or occupancy 

of the lands. Nothing in this subsection shall be construed to require 

the United States or its lessees, licensees, permittees, or assignees to 

support the surface of the conveyed lands.

 (e) Indemnify and Hold Harmless.--The City shall indemnify, defend, 

and hold harmless the United States for, from, and against, and the City 

shall assume all responsibility for, any and all liability of any kind 

or nature, including all loss, cost, expense, or damage, arising from 

the City's use or occupancy of, or operations on, the land conveyed 

under subsection (a), whether such use or occupancy of, or operations 

on, occurred before or occur after the date of the enactment of this 

Act.

 (f) Instrument of Conveyance.--

Not <<NOTE: Deadline. Records.>> later than 1 year after the date of the 

enactment of this Act, the Secretary shall execute, file, and cause to 

be recorded in the appropriate office a deed or other appropriate 

instrument documenting the conveyance made by this section.

SEC. 334. <<NOTE: Effective date. 10 USC 7420 note.>> REVOCATION OF LAND 

 WITHDRAWAL.

 Effective on the date of the enactment of this Act, the Executive 

Order of December 13, 1912, which created Naval Petroleum Reserve 

Numbered 2, is revoked in its entirety.

 Subtitle E--Production Incentives

SEC. 341. <<NOTE: 42 USC 15901.>> DEFINITION OF SECRETARY.

 In this subtitle, the term ``Secretary'' means the Secretary of the 

Interior.

SEC. 342. <<NOTE: 42 USC 15902.>> PROGRAM ON OIL AND GAS ROYALTIES IN-

 KIND.

 (a) Applicability of Section.--Notwithstanding any other provision 

of law, this section applies to all royalty in-kind accepted by the 

Secretary on or after the date of enactment of this Act under any 

Federal oil or gas lease or permit under--

 (1) section 36 of the Mineral Leasing Act (30 U.S.C. 192);

 (2) section 27 of the Outer Continental Shelf Lands Act (43 

 U.S.C. 1353); or

[[Page 119 STAT. 698]]

 (3) any other Federal law governing leasing of Federal land 

 for oil and gas development.

 (b) Terms and Conditions.--All royalty accruing to the United States 

shall, on the demand of the Secretary, be paid in-kind. If the Secretary 

makes such a demand, the following provisions apply to the payment:

 (1) Satisfaction of royalty obligation.--Delivery by, or on 

 behalf of, the lessee of the royalty amount and quality due 

 under the lease satisfies royalty obligation of the lessee for 

 the amount delivered, except that transportation and processing 

 reimbursements paid to, or deductions claimed by, the lessee 

 shall be subject to review and audit.

 (2) Marketable condition.--

 (A) Definition of marketable condition.--In this 

 paragraph, the term ``in marketable condition'' means 

 sufficiently free from impurities and otherwise in a 

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 condition that the royalty production will be accepted 

 by a purchaser under a sales contract typical of the 

 field or area in which the royalty production was 

 produced.

 (B) Requirement.--Royalty production shall be placed 

 in marketable condition by the lessee at no cost to the 

 United States.

 (3) Disposition by the secretary.--The Secretary may--

 (A) sell or otherwise dispose of any royalty 

 production taken in-kind (other than oil or gas 

 transferred under section 27(a)(3) of the Outer 

 Continental Shelf Lands Act (43 U.S.C. 1353(a)(3)) for 

 not less than the market price; and

 (B) transport or process (or both) any royalty 

 production taken in-kind.

 (4) Retention by the secretary.--The Secretary may, 

 notwithstanding section 3302 of title 31, United States Code, 

 retain and use a portion of the revenues from the sale of oil 

 and gas taken in-kind that otherwise would be deposited to 

 miscellaneous receipts, without regard to fiscal year 

 limitation, or may use oil or gas received as royalty taken in-

 kind (referred to in this paragraph as ``royalty production'') 

 to pay the cost of--

 (A) transporting the royalty production;

 (B) processing the royalty production;

 (C) disposing of the royalty production; or

 (D) any combination of transporting, processing, and 

 disposing of the royalty production.

 (5) Limitation.--

 (A) In general.--Except as provided in subparagraph 

 (B), the Secretary may not use revenues from the sale of 

 oil and gas taken in-kind to pay for personnel, travel, 

 or other administrative costs of the Federal Government.

 (B) Exception.--Notwithstanding subparagraph (A), 

 the Secretary may use a portion of the revenues from 

 royalty in-kind sales, without fiscal year limitation, 

 to pay salaries and other administrative costs directly 

 related to the royalty in-kind program.

 (c) Reimbursement of Cost.--If the lessee, pursuant to an agreement 

with the United States or as provided in the lease, processes the 

royalty gas or delivers the royalty oil or gas at a point not on or 

adjacent to the lease area, the Secretary shall--

[[Page 119 STAT. 699]]

 (1) reimburse the lessee for the reasonable costs of 

 transportation (not including gathering) from the lease to the 

 point of delivery or for processing costs; or

 (2) allow the lessee to deduct the transportation or 

 processing costs in reporting and paying royalties in-value for 

 other Federal oil and gas leases.

 (d) Benefit to the United States Required.--The Secretary may 

receive oil or gas royalties in-kind only if the Secretary determines 

that receiving royalties in-kind provides benefits to the United States 

that are greater than or equal to the benefits that are likely to have 

been received had royalties been taken in-value.

 (e) Reports.--

 (1) In general.--Not later than September 30, 2006, the 

 Secretary shall submit to Congress a report that addresses--

 (A) actions taken to develop business processes and 

 automated systems to fully support the royalty-in-kind 

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 capability to be used in tandem with the royalty-in-

 value approach in managing Federal oil and gas revenue; 

 and

 (B) future royalty-in-kind businesses operation 

 plans and objectives.

 (2) Reports on oil or gas royalties taken in-kind.--For each 

 of fiscal years 2006 through 2015 in which the United States 

 takes oil or gas royalties in-kind from production in any State 

 or from the outer Continental Shelf, excluding royalties taken 

 in-kind and sold to refineries under subsection (h), the 

 Secretary shall submit to Congress a report that describes--

 (A) the 1 or more methodologies used by the 

 Secretary to determine compliance with subsection (d), 

 including the performance standard for comparing amounts 

 received by the United States derived from royalties in-

 kind to amounts likely to have been received had 

 royalties been taken in-value;

 (B) an explanation of the evaluation that led the 

 Secretary to take royalties in-kind from a lease or 

 group of leases, including the expected revenue effect 

 of taking royalties in-kind;

 (C) actual amounts received by the United States 

 derived from taking royalties in-kind and costs and 

 savings incurred by the United States associated with 

 taking royalties in-kind, including administrative 

 savings and any new or increased administrative costs; 

 and

 (D) an evaluation of other relevant public benefits 

 or detriments associated with taking royalties in-kind.

 (f) Deduction of Expenses.--

 (1) In general.--Before making payments under section 35 of 

 the Mineral Leasing Act (30 U.S.C. 191) or section 8(g) of the 

 Outer Continental Shelf Lands Act (43 U.S.C. 1337(g)) of 

 revenues derived from the sale of royalty production taken in-

 kind from a lease, the Secretary shall deduct amounts paid or 

 deducted under subsections (b)(4) and (c) and deposit the amount 

 of the deductions in the miscellaneous receipts of the Treasury.

 (2) Accounting for deductions.--When the Secretary allows 

 the lessee to deduct transportation or processing costs under 

 subsection (c), the Secretary may not reduce any payments to 

 recipients of revenues derived from any other Federal oil and 

 gas lease as a consequence of that deduction.

[[Page 119 STAT. 700]]

 (g) Consultation With States.--The Secretary--

 (1) shall consult with a State before conducting a royalty 

 in-kind program under this subtitle within the State;

 (2) may delegate management of any portion of the Federal 

 royalty in-kind program to the State except as otherwise 

 prohibited by Federal law; and

 (3) shall consult annually with any State from which Federal 

 oil or gas royalty is being taken in-kind to ensure, to the 

 maximum extent practicable, that the royalty in-kind program 

 provides revenues to the State greater than or equal to the 

 revenues likely to have been received had royalties been taken 

 in-value.

 (h) Small Refineries.--

 (1) Preference.--If the Secretary finds that sufficient 

 supplies of crude oil are not available in the open market to 

 refineries that do not have their own source of supply for crude 

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 oil, the Secretary may grant preference to those refineries in 

 the sale of any royalty oil accruing or reserved to the United 

 States under Federal oil and gas leases issued under any mineral 

 leasing law, for processing or use in those refineries at 

 private sale at not less than the market price.

 (2) Proration among refineries in production area.--In 

 disposing of oil under this subsection, the Secretary may, at 

 the discretion of the Secretary, prorate the oil among 

 refineries described in paragraph (1) in the area in which the 

 oil is produced.

 (i) Disposition to Federal Agencies.--

 (1) Onshore royalty.--Any royalty oil or gas taken by the 

 Secretary in-kind from onshore oil and gas leases may be sold at 

 not less than the market price to any Federal agency.

 (2) Offshore royalty.--Any royalty oil or gas taken in-kind 

 from a Federal oil or gas lease on the outer Continental Shelf 

 may be disposed of only under section 27 of the Outer 

 Continental Shelf Lands Act (43 U.S.C. 1353).

 (j) Federal Low-Income Energy Assistance Programs.--

 (1) Preference.--In disposing of royalty oil or gas taken 

 in-kind under this section, the Secretary may grant a preference 

 to any person, including any Federal or State agency, for the 

 purpose of providing additional resources to any Federal low-

 income energy assistance program.

 (2) Report.--Not later than 3 years after the date of 

 enactment of this Act, the Secretary shall submit a report to 

 Congress--

 (A) assessing the effectiveness of granting 

 preferences specified in paragraph (1); and

 (B) providing a specific recommendation on the 

 continuation of authority to grant preferences.

SEC. 343. <<NOTE: 42 USC 15903.>> MARGINAL PROPERTY PRODUCTION 

 INCENTIVES.

 (a) Definition of Marginal Property.--Until such time as the 

Secretary issues regulations under subsection (e) that prescribe a 

different definition, in this section, the term ``marginal property'' 

means an onshore unit, communitization agreement, or lease not within a 

unit or communitization agreement, that produces on average the combined 

equivalent of less than 15 barrels of oil per well per day or 90,000,000 

British thermal units of gas per

[[Page 119 STAT. 701]]

well per day calculated based on the average over the 3 most recent 

production months, including only wells that produce on more than half 

of the days during those 3 production months.

 (b) Conditions for Reduction of Royalty Rate.--Until such time as 

the Secretary issues regulations under subsection (e) that prescribe 

different standards or requirements, the Secretary shall reduce the 

royalty rate on--

 (1) oil production from marginal properties as prescribed in 

 subsection (c) if the spot price of West Texas Intermediate 

 crude oil at Cushing, Oklahoma, is, on average, less than $15 

 per barrel (adjusted in accordance with the Consumer Price Index 

 for all-urban consumers, United States city average, as 

 published by the Bureau of Labor Statistics) for 90 consecutive 

 trading days; and

 (2) gas production from marginal properties as prescribed in 

 subsection (c) if the spot price of natural gas delivered at 

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 Henry Hub, Louisiana, is, on average, less than $2.00 per 

 million British thermal units (adjusted in accordance with the 

 Consumer Price Index for all-urban consumers, United States city 

 average, as published by the Bureau of Labor Statistics) for 90 

 consecutive trading days.

 (c) Reduced Royalty Rate.--

 (1) In general.--When a marginal property meets the 

 conditions specified in subsection (b), the royalty rate shall 

 be the lesser of--

 (A) 5 percent; or

 (B) the applicable rate under any other statutory or 

 regulatory royalty relief provision that applies to the 

 affected production.

 (2) Period of effectiveness.--The reduced royalty rate under 

 this subsection shall be effective beginning on the first day of 

 the production month following the date on which the applicable 

 condition specified in subsection (b) is met.

 (d) Termination of Reduced Royalty Rate.--A royalty rate prescribed 

in subsection (c)(1) shall terminate--

 (1) with respect to oil production from a marginal property, 

 on the first day of the production month following the date on 

 which--

 (A) the spot price of West Texas Intermediate crude 

 oil at Cushing, Oklahoma, on average, exceeds $15 per 

 barrel (adjusted in accordance with the Consumer Price 

 Index for all-urban consumers, United States city 

 average, as published by the Bureau of Labor Statistics) 

 for 90 consecutive trading days; or

 (B) the property no longer qualifies as a marginal 

 property; and

 (2) with respect to gas production from a marginal property, 

 on the first day of the production month following the date on 

 which--

 (A) the spot price of natural gas delivered at Henry 

 Hub, Louisiana, on average, exceeds $2.00 per million 

 British thermal units (adjusted in accordance with the 

 Consumer Price Index for all-urban consumers, United 

 States city average, as published by the Bureau of Labor 

 Statistics) for 90 consecutive trading days; or

 (B) the property no longer qualifies as a marginal 

 property.

[[Page 119 STAT. 702]]

 (e) Regulations Prescribing Different Relief.--

 (1) Discretionary regulations.--The Secretary may by 

 regulation prescribe different parameters, standards, and 

 requirements for, and a different degree or extent of, royalty 

 relief for marginal properties in lieu of those prescribed in 

 subsections (a) through (d).

 (2) Mandatory regulations.--Unless 

 a <<NOTE: Deadline.>> determination is made under paragraph (3), 

 not later than 18 months after the date of enactment of this 

 Act, the Secretary shall by regulation--

 (A) prescribe standards and requirements for, and 

 the extent of royalty relief for, marginal properties 

 for oil and gas leases on the outer Continental Shelf; 

 and

 (B) define what constitutes a marginal property on 

 the outer Continental Shelf for purposes of this 

 section.

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 (3) Report.--To the extent the Secretary determines that it 

 is not practicable to issue the regulations referred to in 

 paragraph (2), the Secretary shall provide a report to Congress 

 explaining such determination by not later than 18 months after 

 the date of enactment of this Act.

 (4) Considerations.--In issuing regulations under this 

 subsection, the Secretary may consider--

 (A) oil and gas prices and market trends;

 (B) production costs;

 (C) abandonment costs;

 (D) Federal and State tax provisions and the effects 

 of those provisions on production economics;

 (E) other royalty relief programs;

 (F) regional differences in average wellhead prices;

 (G) national energy security issues; and

 (H) other relevant matters, as determined by the 

 Secretary.

 (f) Savings Provision.--Nothing in this section prevents a lessee 

from receiving royalty relief or a royalty reduction pursuant to any 

other law (including a regulation) that provides more relief than the 

amounts provided by this section.

SEC. 344. <<NOTE: 42 USC 15904.>> INCENTIVES FOR NATURAL GAS PRODUCTION 

 FROM DEEP WELLS IN THE SHALLOW WATERS OF THE GULF OF MEXICO.

 (a) Royalty Incentive Regulations for Ultra Deep Gas Wells.--

 (1) In general.--Not <<NOTE: Deadline.>> later than 180 days 

 after the date of enactment of this Act, in addition to any 

 other regulations that may provide royalty incentives for 

 natural gas produced from deep wells on oil and gas leases 

 issued pursuant to the Outer Continental Shelf Lands Act (43 

 U.S.C. 1331 et seq.), the Secretary shall issue regulations 

 granting royalty relief suspension volumes of not less than 35 

 billion cubic feet with respect to the production of natural gas 

 from ultra deep wells on leases issued in shallow waters less 

 than 400 meters deep located in the Gulf of Mexico wholly west 

 of 87 degrees, 30 minutes west longitude. <<NOTE: Effective 

 date. Notices. Federal Register, publication.>> Regulations 

 issued under this subsection shall be retroactive to the date 

 that the notice of proposed rulemaking is published in the 

 Federal Register.

[[Page 119 STAT. 703]]

 (2) Suspension volumes.--The Secretary may grant suspension 

 volumes of not less than 35 billion cubic feet in any case in 

 which--

 (A) the ultra deep well is a sidetrack; or

 (B) the lease has previously produced from wells 

 with a perforated interval the top of which is at least 

 15,000 feet true vertical depth below the datum at mean 

 sea level.

 (3) Definitions.--In this subsection:

 (A) Ultra deep well.--The term ``ultra deep well'' 

 means a well drilled with a perforated interval, the top 

 of which is at least 20,000 true vertical depth below 

 the datum at mean sea level.

 (B) Sidetrack.--

 (i) In general.--The term ``sidetrack'' means 

 a well resulting from drilling an additional hole 

 to a new objective bottom-hole location by leaving 

 a previously drilled hole.

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 (ii) Inclusion.--The term ``sidetrack'' 

 includes--

 (I) drilling a well from a platform 

 slot reclaimed from a previously drilled 

 well;

 (II) re-entering and deepening a 

 previously drilled well; and

 (III) a bypass from a sidetrack, 

 including drilling around material 

 blocking a hole or drilling to 

 straighten a crooked hole.

 (b) Royalty <<NOTE: Deadline.>> Incentive Regulations for Deep Gas 

Wells.--Not later than 180 days after the date of enactment of this Act, 

in addition to any other regulations that may provide royalty incentives 

for natural gas produced from deep wells on oil and gas leases issued 

pursuant to the Outer Continental Shelf Lands Act (43 U.S.C. 1331 et 

seq.), the Secretary shall issue regulations granting royalty relief 

suspension volumes with respect to production of natural gas from deep 

wells on leases issued in waters more than 200 meters but less than 400 

meters deep located in the Gulf of Mexico wholly west of 87 degrees, 30 

minutes west longitude. The suspension volumes for deep wells within 200 

to 400 meters of water depth shall be calculated using the same 

methodology used to calculate the suspension volumes for deep wells in 

the shallower waters of the Gulf of Mexico, and in no case shall the 

suspension volumes for deep wells within 200 to 400 meters of water 

depth be lower than those for deep wells in shallower 

waters. <<NOTE: Effective date. Notices. Federal 

Register, publication.>> Regulations issued under this subsection shall 

be retroactive to the date that the notice of proposed rulemaking is 

published in the Federal Register.

 (c) Limitations.--The Secretary may place limitations on the royalty 

relief granted under this section based on market price. The royalty 

relief granted under this section shall not apply to a lease for which 

deep water royalty relief is available.

SEC. 345. <<NOTE: 42 USC 15905.>> ROYALTY RELIEF FOR DEEP WATER 

 PRODUCTION.

 (a) In General.--Subject to <<NOTE: Effective date.>> subsections 

(b) and (c), for each tract located in water depths of greater than 400 

meters in the Western and Central Planning Area of the Gulf of Mexico 

(including the portion of the Eastern Planning Area of the Gulf of 

Mexico encompassing whole lease blocks lying west of 87 degrees, 30 

minutes West longitude), any oil or gas lease sale under the Outer

[[Page 119 STAT. 704]]

Continental Shelf Lands Act (43 U.S.C. 1331 et seq.) occurring during 

the 5-year period beginning on the date of enactment of this Act shall 

use the bidding system authorized under section 8(a)(1)(H) of the Outer 

Continental Shelf Lands Act (43 U.S.C. 1337(a)(1)(H)).

 (b) Suspension of Royalties.--The suspension of royalties under 

subsection (a) shall be established at a volume of not less than--

 (1) 5,000,000 barrels of oil equivalent for each lease in 

 water depths of 400 to 800 meters;

 (2) 9,000,000 barrels of oil equivalent for each lease in 

 water depths of 800 to 1,600 meters;

 (3) 12,000,000 barrels of oil equivalent for each lease in 

 water depths of 1,600 to 2,000 meters; and

 (4) 16,000,000 barrels of oil equivalent for each lease in 

 water depths greater than 2,000 meters.

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 (c) Limitation.--The Secretary may place limitations on royalty 

relief granted under this section based on market price.

SEC. 346. ALASKA OFFSHORE ROYALTY SUSPENSION.

 Section 8(a)(3)(B) of the Outer Continental Shelf Lands Act (43 

U.S.C. 1337(a)(3)(B)) is amended by inserting ``and in the Planning 

Areas offshore Alaska'' after ``West longitude''.

SEC. 347. OIL AND GAS LEASING IN THE NATIONAL PETROLEUM RESERVE IN 

 ALASKA.

 (a) Transfer of Authority.--

 (1) Redesignation.--The Naval Petroleum Reserves Production 

 Act of 1976 (42 U.S.C. 6501 et seq.) is amended by redesignating 

 section 107 (42 U.S.C. 6507) as section 108.

 (2) Transfer.--The <<NOTE: 42 USC 6506a.>> matter under the 

 heading ``exploration of national petroleum reserve in alaska'' 

 under the heading ``energy and minerals'' of title I of Public 

 Law 96-514 (42 U.S.C. 6508) is--

 (A) transferred to the Naval Petroleum Reserves 

 Production Act of 1976 (42 U.S.C. 6501 et seq.);

 (B) redesignated as section 107 of that Act; and

 (C) moved so as to appear after section 106 of that 

 Act (42 U.S.C. 6506).

 (b) Competitive Leasing.--Section 107 of the Naval Petroleum 

Reserves Production Act of 1976 (as amended by subsection (a)(2)) is 

amended--

 (1) by striking the heading and all that follows through 

 ``Provided, That (1) activities'' and inserting the following:

``SEC. 107. COMPETITIVE LEASING OF OIL AND GAS.

 ``(a) In General.--The Secretary shall conduct an expeditious 

program of competitive leasing of oil and gas in the Reserve in 

accordance with this Act.

 ``(b) Mitigation of Adverse Effects.--Activities'';

 (2) by striking ``Alaska (the Reserve); (2) the'' and 

 inserting ``Alaska''.

 ``(c) Land Use Planning; BLM Wilderness Study.--The'';

 (3) by striking ``Reserve; (3) the'' and inserting 

 ``Reserve''.

 ``(d) First Lease Sale.--The;'';

 (4) by striking ``4332); (4) the'' and inserting ``4321 et 

 seq.)''.

 ``(e) Withdrawals.--The'';

[[Page 119 STAT. 705]]

 (5) by striking ``herein; (5) bidding'' and inserting 

 ``under this section''.

 ``(f) Bidding Systems.--Bidding'';

 (6) by striking ``629); (6) lease'' and inserting ``629)''.

 ``(g) Geological Structures.--Lease'';

 (7) by striking ``structures; (7) the'' and inserting 

 ``structures''.

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 ``(h) Size of Lease Tracts.--The'';

 (8) by striking ``Secretary; (8)'' and all that follows 

 through ``Drilling, production,'' and inserting ``Secretary''.

 ``(i) <<NOTE: Deadlines.>> Terms.--

 ``(1) In general.--Each lease shall be issued for an initial 

 period of not more than 10 years, and shall be extended for so 

 long thereafter as oil or gas is produced from the lease in 

 paying quantities, oil or gas is capable of being produced in 

 paying quantities, or drilling or reworking operations, as 

 approved by the Secretary, are conducted on the leased land.

 ``(2) Renewal of leases with discoveries.--At the end of the 

 primary term of a lease the Secretary shall renew for an 

 additional 10-year term a lease that does not meet the 

 requirements of paragraph (1) if the lessee submits to the 

 Secretary an application for renewal not later than 60 days 

 before the expiration of the primary lease and the lessee 

 certifies, and the Secretary agrees, that hydrocarbon resources 

 were discovered on one or more wells drilled on the leased land 

 in such quantities that a prudent operator would hold the lease 

 for potential future development.

 ``(3) Renewal of leases without discoveries.--At the end of 

 the primary term of a lease the Secretary shall renew for an 

 additional 10-year term a lease that does not meet the 

 requirements of paragraph (1) if the lessee submits to the 

 Secretary an application for renewal not later than 60 days 

 before the expiration of the primary lease and pays the 

 Secretary a renewal fee of $100 per acre of leased land, and--

 ``(A) the lessee provides evidence, and the 

 Secretary agrees that, the lessee has diligently pursued 

 exploration that warrants continuation with the intent 

 of continued exploration or future potential development 

 of the leased land; or

 ``(B) all or part of the lease--

 ``(i) is part of a unit agreement covering a 

 lease described in subparagraph (A); and

 ``(ii) has not been previously contracted out 

 of the unit.

 ``(4) Applicability.--This subsection applies to a lease 

 that is in effect on or after the date of enactment of the 

 Energy Policy Act of 2005.

 ``(5) Expiration for <<NOTE: Deadline.>> failure to 

 produce.--Notwithstanding any other provision of this Act, if no 

 oil or gas is produced from a lease within 30 years after the 

 date of the issuance of the lease the lease shall expire.

 ``(6) Termination.--No lease issued under this section 

 covering lands capable of producing oil or gas in paying 

 quantities shall expire because the lessee fails to produce the 

 same due to circumstances beyond the control of the lessee.

 ``(j) Unit Agreements.--

[[Page 119 STAT. 706]]

 ``(1) In general.--For the purpose of conservation of the 

 natural resources of all or part of any oil or gas pool, field, 

 reservoir, or like area, lessees (including representatives) of 

 the pool, field, reservoir, or like area may unite with each 

 other, or jointly or separately with others, in collectively 

 adopting and operating under a unit agreement for all or part of 

 the pool, field, reservoir, or like area (whether or not any 

 other part of the oil or gas pool, field, reservoir, or like 

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 area is already subject to any cooperative or unit plan of 

 development or operation), if the Secretary determines the 

 action to be necessary or advisable in the public interest. In 

 determining the public interest, the Secretary should consider, 

 among other things, the extent to which the unit agreement will 

 minimize the impact to surface resources of the leases and will 

 facilitate consolidation of facilities.

 ``(2) Consultation.--In making a determination under 

 paragraph (1), the Secretary shall consult with and provide 

 opportunities for participation by the State of Alaska or a 

 Regional Corporation (as defined in section 3 of the Alaska 

 Native Claims Settlement Act (43 U.S.C. 1602)) with respect to 

 the creation or expansion of units that include acreage in which 

 the State of Alaska or the Regional Corporation has an interest 

 in the mineral estate.

 ``(3) Production allocation methodology.--(A) The Secretary 

 may use a production allocation methodology for each 

 participating area within a unit that includes solely Federal 

 land in the Reserve.

 ``(B) The Secretary shall use a production allocation 

 methodology for each participating area within a unit that 

 includes Federal land in the Reserve and non-Federal land based 

 on the characteristics of each specific oil or gas pool, field, 

 reservoir, or like area to take into account reservoir 

 heterogeneity and area variation in reservoir producibility 

 across diverse leasehold interests. The implementation of the 

 foregoing production allocation methodology shall be controlled 

 by agreement among the affected lessors and lessees.

 ``(4) Benefit of operations.--Drilling, production,'';

 (9) by striking ``When separate'' and inserting the 

 following:

 ``(5) Pooling.--If separate'';

 (10) by inserting ``(in consultation with the owners of the 

 other land)'' after ``determined by the Secretary of the 

 Interior'';

 (11) by striking ``thereto; (10) to'' and all that follows 

 through ``the terms provided therein'' and inserting ``to the 

 agreement.

 ``(k) Exploration Incentives.--

 ``(1) In general.--

 ``(A) Waiver, suspension, or reduction.--To 

 encourage the greatest ultimate recovery of oil or gas 

 or in the interest of conservation, the Secretary may 

 waive, suspend, or reduce the rental fees or minimum 

 royalty, or reduce the royalty on an entire leasehold 

 (including on any lease operated pursuant to a unit 

 agreement), whenever (after consultation with the State 

 of Alaska and the North Slope Borough of Alaska and the 

 concurrence of any Regional Corporation for leases that 

 include land that was made available for acquisition by 

 the Regional Corporation under the provisions of section 

 1431(o) of the Alaska National

[[Page 119 STAT. 707]]

 Interest Lands Conservation Act (16 U.S.C. 3101 et 

 seq.)) in the judgment of the Secretary it is necessary 

 to do so to promote development, or whenever in the 

 judgment of the Secretary the leases cannot be 

 successfully operated under the terms provided therein.

 ``(B) Applicability.--This paragraph applies to a 

 lease that is in effect on or after the date of 

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 enactment of the Energy Policy Act of 2005.'';

 (12) by striking ``The Secretary is authorized to'' and 

 inserting the following:

 ``(2) Suspension of operations and production.--The 

 Secretary may'';

 (13) by striking ``In the event'' and inserting the 

 following:

 ``(3) Suspension of payments.--If'';

 (14) by striking ``thereto; and (11) all'' and inserting 

 ``to the lease.

 ``(l) Receipts.--All'';

 (15) by redesignating subparagraphs (A), (B), and (C) as 

 paragraphs (1), (2), and (3), respectively;

 (16) by striking ``Any agency'' and inserting the following:

 ``(m) Explorations.--Any agency'';

 (17) by striking ``Any action'' and inserting the following:

 ``(n) Environmental Impact Statements.--

 ``(1) Judicial review.--Any action'';

 (18) by striking ``The detailed'' and inserting the 

 following:

 ``(2) Initial lease sales.--The detailed'';

 (19) by striking ``section 104(b) of the Naval Petroleum 

 Reserves Production Act of 1976 (90 Stat. 304; 42 U.S.C. 6504)'' 

 and inserting ``section 104(a)''; and

 (20) by adding at the end the following:

 ``(o) Regulations.--As soon as practicable after the date of 

enactment of the Energy Policy Act of 2005, the Secretary shall issue 

regulations to implement this section.

 ``(p) Waiver of Administration for Conveyed Lands.--

 ``(1) In general.--Notwithstanding section 14(g) of the 

 Alaska Native Claims Settlement Act (43 U.S.C. 1613(g))--

 ``(A) the Secretary of the Interior shall waive 

 administration of any oil and gas lease to the extent 

 that the lease covers any land in the Reserve in which 

 all of the subsurface estate is conveyed to the Arctic 

 Slope Regional Corporation (referred to in this 

 subsection as the `Corporation');

 ``(B)(i) in a case in which a conveyance of a 

 subsurface estate described in subparagraph (A) does not 

 include all of the land covered by the oil and gas 

 lease, the person that owns the subsurface estate in any 

 particular portion of the land covered by the lease 

 shall be entitled to all of the revenues reserved under 

 the lease as to that portion, including, without 

 limitation, all the royalty payable with respect to oil 

 or gas produced from or allocated to that portion;

 ``(ii) in a case described in clause (i), the 

 Secretary of the Interior shall--

 ``(I) segregate the lease into 2 

 leases, 1 of which shall cover only the 

 subsurface estate conveyed to the 

 Corporation; and

[[Page 119 STAT. 708]]

 ``(II) waive administration of the 

 lease that covers the subsurface estate 

 conveyed to the Corporation; and

 ``(iii) the segregation of the lease described 

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 in clause (ii)(I) has no effect on the obligations 

 of the lessee under either of the resulting 

 leases, including obligations relating to 

 operations, production, or other circumstances 

 (other than payment of rentals or royalties); and

 ``(C) nothing in this subsection limits the 

 authority of the Secretary of the Interior to manage the 

 federally-owned surface estate within the Reserve.''.

 (c) Conforming Amendments.--Section 104 of the Naval Petroleum 

Reserves Production Act of 1976 (42 U.S.C. 6504) is amended--

 (1) by striking subsection (a); and

 (2) by redesignating subsections (b) through (d) as 

 subsections (a) through (c), respectively.

SEC. 348. <<NOTE: Alaska. 42 USC 15906.>> NORTH SLOPE SCIENCE 

 INITIATIVE.

 (a) Establishment.--

 (1) In general.--The Secretary of the Interior shall 

 establish a long-term initiative to be known as the ``North 

 Slope Science Initiative'' (referred to in this section as the 

 ``Initiative'').

 (2) Purpose.--The purpose of the Initiative shall be to 

 implement efforts to coordinate collection of scientific data 

 that will provide a better understanding of the terrestrial, 

 aquatic, and marine ecosystems of the North Slope of Alaska.

 (b) Objectives.--To ensure that the Initiative is conducted through 

a comprehensive science strategy and implementation plan, the Initiative 

shall, at a minimum--

 (1) identify and prioritize information needs for inventory, 

 monitoring, and research activities to address the individual 

 and cumulative effects of past, ongoing, and anticipated 

 development activities and environmental change on the North 

 Slope;

 (2) develop an understanding of information needs for 

 regulatory and land management agencies, local governments, and 

 the public;

 (3) focus on prioritization of pressing natural resource 

 management and ecosystem information needs, coordination, and 

 cooperation among agencies and organizations;

 (4) coordinate ongoing and future inventory, monitoring, and 

 research activities to minimize duplication of effort, share 

 financial resources and expertise, and assure the collection of 

 quality information;

 (5) identify priority needs not addressed by agency science 

 programs in effect on the date of enactment of this Act and 

 develop a funding strategy to meet those needs;

 (6) provide a consistent approach to high caliber science, 

 including inventory, monitoring, and research;

 (7) maintain and improve public and agency access to--

 (A) accumulated and ongoing research; and

 (B) contemporary and traditional local knowledge; 

 and

[[Page 119 STAT. 709]]

 (8) ensure through appropriate peer review that the science 

 conducted by participating agencies and organizations is of the 

 highest technical quality.

 (c) Membership.--

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 (1) In general.--To ensure comprehensive collection of 

 scientific data, in carrying out the Initiative, the Secretary 

 shall consult and coordinate with Federal, State, and local 

 agencies that have responsibilities for land and resource 

 management across the North Slope.

 (2) Cooperative agreements.--The Secretary shall enter into 

 cooperative agreements with the State of Alaska, the North Slope 

 Borough, the Arctic Slope Regional Corporation, and other 

 Federal agencies as appropriate to coordinate efforts, share 

 resources, and fund projects under this section.

 (d) Science <<NOTE: Establishment.>> Technical Advisory Panel.--

 (1) In general.--The Initiative shall include a panel to 

 provide advice on proposed inventory, monitoring, and research 

 functions.

 (2) Membership.--The panel described in paragraph (1) shall 

 consist of a representative group of not more than 15 scientists 

 and technical experts from diverse professions and interests, 

 including the oil and gas industry, subsistence users, Native 

 Alaskan entities, conservation organizations, wildlife 

 management organizations, and academia, as determined by the 

 Secretary.

 (e) Reports.--Not later than 3 years after the date of enactment of 

this section and each year thereafter, the Secretary shall publish a 

report that describes the studies and findings of the Initiative.

 (f) Authorization of Appropriations.--There are authorized to be 

appropriated such sums as are necessary to carry out this section.

SEC. 349. <<NOTE: 42 USC 15907.>> ORPHANED, ABANDONED, OR IDLED WELLS ON 

 FEDERAL LAND.

 (a) In General.--The <<NOTE: Deadline.>> Secretary, in cooperation 

with the Secretary of Agriculture, shall establish a program not later 

than 1 year after the date of enactment of this Act to remediate, 

reclaim, and close orphaned, abandoned, or idled oil and gas wells 

located on land administered by the land management agencies within the 

Department of the Interior and the Department of Agriculture.

 (b) Activities.--The program under subsection (a) shall--

 (1) include a means of ranking orphaned, abandoned, or idled 

 wells sites for priority in remediation, reclamation, and 

 closure, based on public health and safety, potential 

 environmental harm, and other land use priorities;

 (2) provide for identification and recovery of the costs of 

 remediation, reclamation, and closure from persons or other 

 entities currently providing a bond or other financial assurance 

 required under State or Federal law for an oil or gas well that 

 is orphaned, abandoned, or idled; and

 (3) provide for recovery from the persons or entities 

 identified under paragraph (2), or their sureties or guarantors, 

 of the costs of remediation, reclamation, and closure of such 

 wells.

 (c) Cooperation and Consultations.--In carrying out the program 

under subsection (a), the Secretary shall--

[[Page 119 STAT. 710]]

 (1) work cooperatively with the Secretary of Agriculture and 

 the States within which Federal land is located; and

 (2) consult with the Secretary of Energy and the Interstate 

 Oil and Gas Compact Commission.

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 (d) Plan.--Not <<NOTE: Deadline.>> later than 1 year after the date 

of enactment of this Act, the Secretary, in cooperation with the 

Secretary of Agriculture, shall submit to Congress a plan for carrying 

out the program under subsection (a).

 (e) Idled Well.--For the purposes of this section, a well is idled 

if--

 (1) the well has been nonoperational for at least 7 years; 

 and

 (2) there is no anticipated beneficial use for the well.

 (f) Federal Reimbursement for Orphaned Well Reclamation Pilot 

Program.--

 (1) Reimbursement for remediating, reclaiming, and closing 

 wells on land subject to a new lease.--The Secretary shall carry 

 out a pilot program under which, in issuing a new oil and gas 

 lease on federally owned land on which 1 or more orphaned wells 

 are located, the Secretary--

 (A) may require, other than as a condition of the 

 lease, that the lessee remediate, reclaim, and close in 

 accordance with standards established by the Secretary, 

 all orphaned wells on the land leased; and

 (B) shall develop a program to reimburse a lessee, 

 through a royalty credit against the Federal share of 

 royalties owed or other means, for the reasonable actual 

 costs of remediating, reclaiming, and closing the 

 orphaned wells pursuant to that requirement.

 (2) Reimbursement for reclaiming orphaned wells on other 

 land.--In carrying out this subsection, the Secretary--

 (A) may authorize any lessee under an oil and gas 

 lease on federally owned land to reclaim in accordance 

 with the Secretary's standards--

 (i) an orphaned well on unleased federally 

 owned land; or

 (ii) an orphaned well located on an existing 

 lease on federally owned land for the reclamation 

 of which the lessee is not legally responsible; 

 and

 (B) shall develop a program to provide reimbursement 

 of 100 percent of the reasonable actual costs of 

 remediating, reclaiming, and closing the orphaned well, 

 through credits against the Federal share of royalties 

 or other means.

 (3) Regulations.--The Secretary may issue such regulations 

 as are appropriate to carry out this subsection.

 (g) Technical Assistance Program for Non-Federal Land.--

 (1) In general.--The Secretary of Energy shall establish a 

 program to provide technical and financial assistance to oil and 

 gas producing States to facilitate State efforts over a 10-year 

 period to ensure a practical and economical remedy for 

 environmental problems caused by orphaned or abandoned oil and 

 gas exploration or production well sites on State or private 

 land.

 (2) Assistance.--The Secretary of Energy shall work with the 

 States, through the Interstate Oil and Gas Compact Commission, 

 to assist the States in quantifying and mitigating

[[Page 119 STAT. 711]]

 environmental risks of onshore orphaned or abandoned oil or gas 

 wells on State and private land.

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 (3) Activities.--The program under paragraph (1) shall 

 include--

 (A) mechanisms to facilitate identification, if 

 feasible, of the persons currently providing a bond or 

 other form of financial assurance required under State 

 or Federal law for an oil or gas well that is orphaned 

 or abandoned;

 (B) criteria for ranking orphaned or abandoned well 

 sites based on factors such as public health and safety, 

 potential environmental harm, and other land use 

 priorities;

 (C) information and training programs on best 

 practices for remediation of different types of sites; 

 and

 (D) funding of State mitigation efforts on a cost-

 shared basis.

 (h) Authorization of Appropriations.--

 (1) In general.--There are authorized to be appropriated to 

 carry out this section $25,000,000 for each of fiscal years 2006 

 through 2010.

 (2) Use.--Of the amounts authorized under paragraph (1), 

 $5,000,000 are authorized for each fiscal year for activities 

 under subsection (f).

SEC. 350. COMBINED HYDROCARBON LEASING.

 (a) Special Provisions Regarding Leasing.--Section 17(b)(2) of the 

Mineral Leasing Act (30 U.S.C. 226(b)(2)) is amended--

 (1) by inserting ``(A)'' after ``(2)''; and

 (2) by adding at the end the following:

 ``(B) For any area that contains any combination of tar sand and oil 

or gas (or both), the Secretary may issue under this Act, separately--

 ``(i) a lease for exploration for and extraction of tar 

 sand; and

 ``(ii) a lease for exploration for and development of oil 

 and gas.

 ``(C) A lease issued for tar sand shall be issued using the same 

bidding process, annual rental, and posting period as a lease issued for 

oil and gas, except that the minimum acceptable bid required for a lease 

issued for tar sand shall be $2 per acre.

 ``(D) The Secretary may waive, suspend, or alter any requirement 

under section 26 that a permittee under a permit authorizing prospecting 

for tar sand must exercise due diligence, to promote any resource 

covered by a combined hydrocarbon lease.''.

 (b) Conforming Amendment.--Section 17(b)(1)(B) of the Mineral 

Leasing Act (30 U.S.C. 226(b)(1)(B)) is amended in the second sentence 

by inserting ``, subject to paragraph (2)(B),'' after ``Secretary''.

 (c) Regulations.--Not <<NOTE: Deadline. 30 USC 226 note.>> later 

than 45 days after the date of enactment of this Act, the Secretary 

shall issue final regulations to implement this section.

SEC. 351. <<NOTE: National Geographical and Geophysical Data 

 Preservation Program Act of 2005. 42 USC 

 15908.>> PRESERVATION OF GEOLOGICAL AND GEOPHYSICAL DATA.

 (a) Short Title.--This section may be cited as the ``National 

Geological and Geophysical Data Preservation Program Act of 2005''.

[[Page 119 STAT. 712]]

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 (b) Program.--The Secretary shall carry out a National Geological 

and Geophysical Data Preservation Program in accordance with this 

section--

 (1) to archive geologic, geophysical, and engineering data, 

 maps, well logs, and samples;

 (2) to provide a national catalog of such archival material; 

 and

 (3) to provide technical and financial assistance related to 

 the archival material.

 (c) Plan.--Not <<NOTE: Deadline.>> later than 1 year after the date 

of enactment of this Act, the Secretary shall submit to Congress a plan 

for the implementation of the Program.

 (d) Data Archive System.--

 (1) Establishment.--The Secretary shall establish, as a 

 component of the Program, a data archive system to provide for 

 the storage, preservation, and archiving of subsurface, surface, 

 geological, geophysical, and engineering data and samples. The 

 Secretary, in consultation with the Advisory Committee, shall 

 develop guidelines relating to the data archive system, 

 including the types of data and samples to be preserved.

 (2) System components.--The system shall be comprised of 

 State agencies that elect to be part of the system and agencies 

 within the Department of the Interior that maintain geological 

 and geophysical data and samples that are designated by the 

 Secretary in accordance with this subsection. The Program shall 

 provide for the storage of data and samples through data 

 repositories operated by such agencies.

 (3) Limitation of designation.--The Secretary may not 

 designate a State agency as a component of the data archive 

 system unless that agency is the agency that acts as the 

 geological survey in the State.

 (4) Data from federal land.--The data archive system shall 

 provide for the archiving of relevant subsurface data and 

 samples obtained from Federal land--

 (A) in the most appropriate repository designated 

 under paragraph (2), with preference being given to 

 archiving data in the State in which the data were 

 collected; and

 (B) consistent with all applicable law and 

 requirements relating to confidentiality and proprietary 

 data.

 (e) National Catalog.--

 (1) In general.--As soon as practicable after the date of 

 enactment of this Act, the Secretary shall develop and maintain, 

 as a component of the Program, a national catalog that 

 identifies--

 (A) data and samples available in the data archive 

 system established under subsection (d);

 (B) the repository for particular material in the 

 system; and

 (C) the means of accessing the material.

 (2) Availability.--The Secretary shall make the national 

 catalog accessible to the public on the site of the Survey on 

 the Internet, consistent with all applicable requirements 

 related to confidentiality and proprietary data.

 (f) Advisory Committee.--

 (1) In general.--The Advisory Committee shall advise the 

 Secretary on planning and implementation of the Program.

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[[Page 119 STAT. 713]]

 (2) New duties.--In addition to its duties under the 

 National Geologic Mapping Act of 1992 (43 U.S.C. 31a et seq.), 

 the Advisory Committee shall perform the following duties:

 (A) Advise the Secretary on developing guidelines 

 and procedures for providing assistance for facilities 

 under subsection (g)(1).

 (B) Review and critique the draft implementation 

 plan prepared by the Secretary under subsection (c).

 (C) Identify useful studies of data archived under 

 the Program that will advance understanding of the 

 Nation's energy and mineral resources, geologic hazards, 

 and engineering geology.

 (D) Review the progress of the Program in archiving 

 significant data and preventing the loss of such data, 

 and the scientific progress of the studies funded under 

 the Program.

 (E) Include in the annual report to the Secretary 

 required under section 5(b)(3) of the National Geologic 

 Mapping Act of 1992 (43 U.S.C. 31d(b)(3)) an evaluation 

 of the progress of the Program toward fulfilling the 

 purposes of the Program under subsection (b).

 (g) Financial Assistance.--

 (1) Archive facilities.--Subject to the availability of 

 appropriations, the Secretary shall provide financial assistance 

 to a State agency that is designated under subsection (d)(2) for 

 providing facilities to archive energy material.

 (2) Studies.--Subject to the availability of appropriations, 

 the Secretary shall provide financial assistance to any State 

 agency designated under subsection (d)(2) for studies and 

 technical assistance activities that enhance understanding, 

 interpretation, and use of materials archived in the data 

 archive system established under subsection (d).

 (3) Federal share.--The Federal share of the cost of an 

 activity carried out with assistance under this subsection shall 

 be not more than 50 percent of the total cost of the activity.

 (4) Private contributions.--

 The <<NOTE: Applicability.>> Secretary shall apply to the non-

 Federal share of the cost of an activity carried out with 

 assistance under this subsection the value of private 

 contributions of property and services used for that activity.

 (h) Report.--The Secretary shall include in each report under 

section 8 of the National Geologic Mapping Act of 1992 (43 U.S.C. 31g)--

 (1) a description of the status of the Program;

 (2) an evaluation of the progress achieved in developing the 

 Program during the period covered by the report; and

 (3) any recommendations for legislative or other action the 

 Secretary considers necessary and appropriate to fulfill the 

 purposes of the Program under subsection (b).

 (i) Maintenance of State Effort.--It is the intent of Congress that 

the States not use this section as an opportunity to reduce State 

resources applied to the activities that are the subject of the Program.

 (j) Definitions.--In this section:

 (1) Advisory committee.--The term ``Advisory Committee'' 

 means the advisory committee established under section 5 of the 

 National Geologic Mapping Act of 1992 (43 U.S.C. 31d).

[[Page 119 STAT. 714]]

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 (2) Program.--The term ``Program'' means the National 

 Geological and Geophysical Data Preservation Program carried out 

 under this section.

 (3) Secretary.--The term ``Secretary'' means the Secretary 

 of the Interior, acting through the Director of the United 

 States Geological Survey.

 (4) Survey.--The term ``Survey'' means the United States 

 Geological Survey.

 (k) Authorization of Appropriations.--There are authorized to be 

appropriated to carry out this section $30,000,000 for each of fiscal 

years 2006 through 2010.

SEC. 352. OIL AND GAS LEASE ACREAGE LIMITATIONS.

 Section 27(d)(1) of the Mineral Leasing Act (30 U.S.C. 184(d)(1)) is 

amended by inserting after ``acreage held in special tar sand areas'' 

the following: ``, and acreage under any lease any portion of which has 

been committed to a federally approved unit or cooperative plan or 

communitization agreement or for which royalty (including compensatory 

royalty or royalty in-kind) was paid in the preceding calendar year,''.

SEC. 353. <<NOTE: 42 USC 15909.>> GAS HYDRATE PRODUCTION INCENTIVE.

 (a) Purpose.--The purpose of this section is to promote natural gas 

production from the natural gas hydrate resources on the outer 

Continental Shelf and Federal lands in Alaska by providing royalty 

incentives.

 (b) Suspension of Royalties.--

 (1) In general.--The Secretary may grant royalty relief in 

 accordance with this section for natural gas produced from gas 

 hydrate resources under an eligible lease.

 (2) Eligible leases.--A lease shall be an eligible lease for 

 purposes of this section if--

 (A) it is issued under the Outer Continental Shelf 

 Lands Act (43 U.S.C. 1331 et seq.), or is an oil and gas 

 lease issued for onshore Federal lands in Alaska;

 (B) it is issued prior to January 1, 2016; and

 (C) production under the lease of natural gas from 

 gas hydrate resources commences prior to January 1, 

 2018.

 (3) Amount of relief.--The Secretary shall conduct a 

 rulemaking and grant royalty relief under this section as a 

 suspension volume if the Secretary determines that such royalty 

 relief would encourage production of natural gas from gas 

 hydrate resources from an eligible lease. The maximum suspension 

 volume shall be 30 billion cubic feet of natural gas per lease. 

 Such relief shall be in addition to any other royalty relief 

 under any other provision applicable to the lease that does not 

 specifically grant a gas hydrate production incentive. Such 

 royalty suspension volume shall be applied to any eligible 

 production occurring on or after the date of publication of the 

 advanced notice of proposed rulemaking.

 (4) Limitation.--The Secretary may place limitations on 

 royalty relief granted under this section based on market price.

 (c) Application.--This section shall apply to any eligible lease 

issued before, on, or after the date of enactment of this Act.

 (d) Rulemakings.--

 (1) Requirement.--

 The <<NOTE: Publication. Notices. Deadlines.>> Secretary shall 

 publish the advanced notice of proposed rulemaking within 180 

 days after the date of enactment of this Act and complete the 

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 rulemaking

[[Page 119 STAT. 715]]

 implementing this section within 365 days after the date of 

 enactment of this Act.

 (2) Gas hydrate resources defined.--Such regulations shall 

 define the term ``gas hydrate resources'' to include both the 

 natural gas content of gas hydrates within the hydrate stability 

 zone and free natural gas trapped by and beneath the hydrate 

 stability zone.

 (e) Review.--Not <<NOTE: Deadline. Reports.>> later than 365 days 

after the date of enactment of this Act, the Secretary, in consultation 

with the Secretary of Energy, shall carry out a review of, and submit to 

Congress a report on, further opportunities to enhance production of 

natural gas from gas hydrate resources on the outer Continental Shelf 

and on Federal lands in Alaska through the provision of other production 

incentives or through technical or financial assistance.

SEC. 354. <<NOTE: 42 USC 15910.>> ENHANCED OIL AND NATURAL GAS 

 PRODUCTION THROUGH CARBON DIOXIDE INJECTION.

 (a) Production Incentive.--

 (1) Findings.--Congress finds the following:

 (A) Approximately two-thirds of the original oil in 

 place in the United States remains unproduced.

 (B) Enhanced oil and natural gas production from the 

 sequestering of carbon dioxide and other appropriate 

 gases has the potential to increase oil and natural gas 

 production.

 (C) Capturing and productively using carbon dioxide 

 would help reduce the carbon intensity of the economy.

 (2) Purpose.--The purpose of this section is--

 (A) to promote the capturing, transportation, and 

 injection of produced carbon dioxide, natural carbon 

 dioxide, and other appropriate gases or other matter for 

 sequestration into oil and gas fields; and

 (B) to promote oil and natural gas production from 

 the outer Continental Shelf and onshore Federal lands 

 under lease by providing royalty incentives to use 

 enhanced recovery techniques using injection of the 

 substances referred to in subparagraph (A).

 (b) Suspension of Royalties.--

 (1) In general.--If the Secretary determines that reduction 

 of the royalty under a Federal oil and gas lease that is an 

 eligible lease is in the public interest and promotes the 

 purposes of this section, the Secretary shall undertake a 

 rulemaking to provide for such reduction for an eligible lease.

 (2) Rulemakings.--

 The <<NOTE: Publication. Notices. Deadlines.>> Secretary shall 

 publish the advanced notice of proposed rulemaking within 180 

 days after the date of enactment of this Act and complete the 

 rulemaking implementing this section within 365 days after the 

 date of enactment of this Act.

 (3) Eligible leases.--A lease shall be an eligible lease for 

 purposes of this section if--

 (A) it is a lease for production of oil and gas from 

 the outer Continental Shelf or Federal onshore lands;

 (B) the injection of the substances referred to in 

 subsection (a)(2)(A) will be used as an enhanced 

 recovery technique on such lease; and

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 (C) the Secretary determines that the lease contains 

 oil or gas that would not likely be produced without the 

 royalty reduction provided under this section.

[[Page 119 STAT. 716]]

 (4) Amount of relief.--The rulemaking shall provide for a 

 suspension volume, which shall not exceed 5,000,000 barrels of 

 oil equivalent for each eligible lease. Such suspension volume 

 shall be applied to any production from an eligible lease 

 occurring on or after the date of publication of any advanced 

 notice of proposed rulemaking under this subsection.

 (5) Limitation.--The Secretary may place limitations on the 

 royalty reduction granted under this section based on market 

 price.

 (6) Application.--This section shall apply to any eligible 

 lease issued before, on, or after the date of enactment of this 

 Act.

 (c) Demonstration Program.--

 (1) Establishment.--

 (A) In general.--The Secretary of Energy shall 

 establish a competitive grant program to provide grants 

 to producers of oil and gas to carry out projects to 

 inject carbon dioxide for the purpose of enhancing 

 recovery of oil or natural gas while increasing the 

 sequestration of carbon dioxide.

 (B) Projects.--The demonstration program shall 

 provide for--

 (i) not more than 10 projects in the Willistin 

 Basin in North Dakota and Montana; and

 (ii) 1 project in the Cook Inlet Basin in 

 Alaska.

 (2) Requirements.--

 (A) In general.--The Secretary of Energy shall issue 

 requirements relating to applications for grants under 

 paragraph (1).

 (B) Rulemaking.--The issuance of requirements under 

 subparagraph (A) shall not require a rulemaking.

 (C) Minimum requirements.--At a minimum, the 

 Secretary shall require under subparagraph (A) that an 

 application for a grant include--

 (i) a description of the project proposed in 

 the application;

 (ii) an estimate of the production increase 

 and the duration of the production increase from 

 the project, as compared to conventional recovery 

 techniques, including water flooding;

 (iii) an estimate of the carbon dioxide 

 sequestered by project, over the life of the 

 project;

 (iv) a plan to collect and disseminate data 

 relating to each project to be funded by the 

 grant;

 (v) a description of the means by which the 

 project will be sustainable without Federal 

 assistance after the completion of the term of the 

 grant;

 (vi) a complete description of the costs of 

 the project, including acquisition, construction, 

 operation, and maintenance costs over the expected 

 life of the project;

 (vii) a description of which costs of the 

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 project will be supported by Federal assistance 

 under this section; and

 (viii) a description of any secondary or 

 tertiary recovery efforts in the field and the 

 efficacy of water flood recovery techniques used.

[[Page 119 STAT. 717]]

 (3) Partners.--An applicant for a grant under paragraph (1) 

 may carry out a project under a pilot program in partnership 

 with 1 or more other public or private entities.

 (4) Selection criteria.--In evaluating applications under 

 this subsection, the Secretary of Energy shall--

 (A) consider the previous experience with similar 

 projects of each applicant; and

 (B) give priority consideration to applications 

 that--

 (i) are most likely to maximize production of 

 oil and gas in a cost-effective manner;

 (ii) sequester significant quantities of 

 carbon dioxide from anthropogenic sources;

 (iii) demonstrate the greatest commitment on 

 the part of the applicant to ensure funding for 

 the proposed project and the greatest likelihood 

 that the project will be maintained or expanded 

 after Federal assistance under this section is 

 completed; and

 (iv) minimize any adverse environmental 

 effects from the project.

 (5) Demonstration program requirements.--

 (A) Maximum amount.--The Secretary of Energy shall 

 not provide more than $3,000,000 in Federal assistance 

 under this subsection to any applicant.

 (B) Cost sharing.--The Secretary of Energy shall 

 require cost-sharing under this subsection in accordance 

 with section 988.

 (C) Period of grants.--

 (i) In general.--A <<NOTE: Deadline.>> project 

 funded by a grant under this subsection shall 

 begin construction not later than 2 years after 

 the date of provision of the grant, but in any 

 case not later than December 31, 2010.

 (ii) Term.--The Secretary shall not provide 

 grant funds to any applicant under this subsection 

 for a period of more than 5 years.

 (6) Transfer of <<NOTE: Procedures.>> information and 

 knowledge.--The Secretary of Energy shall establish mechanisms 

 to ensure that the information and knowledge gained by 

 participants in the program under this subsection are 

 transferred among other participants and interested persons, 

 including other applicants that submitted applications for a 

 grant under this subsection.

 (7) Schedule.--

 (A) Publication.--Not <<NOTE: Deadline. Federal 

 Register, publication.>> later than 180 days after the 

 date of enactment of this Act, the Secretary of Energy 

 shall publish in the Federal Register, and elsewhere, as 

 appropriate, a request for applications to carry out 

 projects under this subsection.

 (B) Date for applications.--

 An <<NOTE: Deadline.>> application for a grant under 

 this subsection shall be submitted not later than 180 

 days after the date of publication of the request under 

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 subparagraph (A).

 (C) Selection.--After the date by which applications 

 for grants are required to be submitted under 

 subparagraph (B), the Secretary of Energy, in a timely 

 manner, shall select, after peer review and based on the 

 criteria under paragraph (4), those projects to be 

 awarded a grant under this subsection.

[[Page 119 STAT. 718]]

 (d) Authorization of Appropriations.--There are authorized to be 

appropriated such sums as are necessary to carry out this section.

SEC. 355. ASSESSMENT OF DEPENDENCE OF STATE OF HAWAII ON OIL.

 (a) Assessment.--The Secretary of Energy shall assess the economic 

implications of the dependence of the State of Hawaii on oil as the 

principal source of energy for the State, including--

 (1) the short- and long-term prospects for crude oil supply 

 disruption and price volatility and potential impacts on the 

 economy of Hawaii;

 (2) the economic relationship between oil-fired generation 

 of electricity from residual fuel and refined petroleum products 

 consumed for ground, marine, and air transportation;

 (3) the technical and economic feasibility of increasing the 

 contribution of renewable energy resources for generation of 

 electricity, on an island-by-island basis, including--

 (A) siting and facility configuration;

 (B) environmental, operational, and safety 

 considerations;

 (C) the availability of technology;

 (D) the effects on the utility system, including 

 reliability;

 (E) infrastructure and transport requirements;

 (F) community support; and

 (G) other factors affecting the economic impact of 

 such an increase and any effect on the economic 

 relationship described in paragraph (2);

 (4) the technical and economic feasibility of using 

 liquefied natural gas to displace residual fuel oil for electric 

 generation, including neighbor island opportunities, and the 

 effect of the displacement on the economic relationship 

 described in paragraph (2), including--

 (A) the availability of supply;

 (B) siting and facility configuration for onshore 

 and offshore liquefied natural gas receiving terminals;

 (C) the factors described in subparagraphs (B) 

 through (F) of paragraph (3); and

 (D) other economic factors;

 (5) the technical and economic feasibility of using 

 renewable energy sources (including hydrogen) for ground, 

 marine, and air transportation energy applications to displace 

 the use of refined petroleum products, on an island-by-island 

 basis, and the economic impact of the displacement on the 

 relationship described in paragraph (2); and

 (6) an island-by-island approach to--

 (A) the development of hydrogen from renewable 

 resources; and

 (B) the application of hydrogen to the energy needs 

 of Hawaii.

 (b) Contracting Authority.--The Secretary of Energy may carry out 

the assessment under subsection (a) directly or, in whole or in part, 

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through 1 or more contracts with qualified public or private entities.

[[Page 119 STAT. 719]]

 (c) Report.--Not later than 300 days after the date of enactment of 

this Act, the Secretary of Energy shall prepare (in consultation with 

agencies of the State of Hawaii and other stakeholders, as appropriate), 

and submit to Congress, a report describing the findings, conclusions, 

and recommendations resulting from the assessment.

 (d) Authorization of Appropriations.--There are authorized to be 

appropriated such sums as are necessary to carry out this section.

SEC. 356. <<NOTE: 42 USC 15911.>> DENALI COMMISSION.

 (a) Definition of Commission.--In this section, the term 

``Commission'' means the Denali Commission established by the Denali 

Commission Act of 1998 (42 U.S.C. 3121 note; Public Law 105-277).

 (b) Energy Programs.--The Commission shall use amounts made 

available under subsection (d) to carry out energy programs, including--

 (1) energy generation and development, including--

 (A) fuel cells, hydroelectric, solar, wind, wave, 

 and tidal energy; and

 (B) alternative energy sources;

 (2) the construction of energy transmission, including 

 interties;

 (3) the replacement and cleanup of fuel tanks;

 (4) the construction of fuel transportation networks and 

 related facilities;

 (5) power cost equalization programs; and

 (6) projects using coal as a fuel, including coal 

 gasification projects.

 (c) Open Meetings.--

 (1) In general.--Except as provided in paragraph (2), a 

 meeting of the Commission shall be open to the public if--

 (A) the Commission members take action on behalf of 

 the Commission; or

 (B) the deliberations of the Commission determine, 

 or result in the joint conduct or disposition of, 

 official Commission business.

 (2) Exceptions.--Paragraph (1) shall not apply to any 

 portion of a Commission meeting for which the Commission, in 

 public session, votes to close the meeting for the reasons 

 described in paragraph (2), (4), (5), or (6) of subsection (c) 

 of section 552b of title 5, United States Code.

 (3) Public notice.--

 (A) In general.--At <<NOTE: Deadline.>> least 1 week 

 before a meeting of the Commission, the Commission shall 

 make a public announcement of the meeting that 

 describes--

 (i) the time, place, and subject matter of the 

 meeting;

 (ii) whether the meeting is to be open or 

 closed to the public; and

 (iii) the name and telephone number of an 

 appropriate person to respond to requests for 

 information about the meeting.

 (B) Additional notice.--The Commission shall make a 

 public announcement of any change to the information

[[Page 119 STAT. 720]]

 made available under subparagraph (A) at the earliest 

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 practicable time.

 (4) Minutes.--The Commission shall keep, and make available 

 to the public, a transcript, electronic recording, or minutes 

 from each Commission meeting, except for portions of the meeting 

 closed under paragraph (2).

 (d) Authorization of Appropriations.--There is authorized to be 

appropriated to the Commission not more than $55,000,000 for each of 

fiscal years 2006 through 2015 to carry out subsection (b).

SEC. 357. <<NOTE: 42 USC 15912.>> COMPREHENSIVE INVENTORY OF OCS OIL AND 

 NATURAL GAS RESOURCES.

 (a) In General.--The Secretary shall conduct an inventory and 

analysis of oil and natural gas resources beneath all of the waters of 

the United States Outer Continental Shelf (``OCS''). The inventory and 

analysis shall--

 (1) use available data on oil and gas resources in areas 

 offshore of Mexico and Canada that will provide information on 

 trends of oil and gas accumulation in areas of the OCS;

 (2) use any available technology, except drilling, but 

 including 3-D seismic technology to obtain accurate resource 

 estimates;

 (3) analyze how resource estimates in OCS areas have changed 

 over time in regards to gathering geological and geophysical 

 data, initial exploration, or full field development, including 

 areas such as the deepwater and subsalt areas in the Gulf of 

 Mexico;

 (4) estimate the effect that understated oil and gas 

 resource inventories have on domestic energy investments; and

 (5) identify and explain how legislative, regulatory, and 

 administrative programs or processes restrict or impede the 

 development of identified resources and the extent that they 

 affect domestic supply, such as moratoria, lease terms and 

 conditions, operational stipulations and requirements, approval 

 delays by the Federal Government and coastal States, and local 

 zoning restrictions for onshore processing facilities and 

 pipeline landings.

 (b) Reports.--The Secretary shall submit a report to Congress on the 

inventory of estimates and the analysis of restrictions or impediments, 

together with any recommendations, within 6 months of the date of 

enactment of the section. <<NOTE: Public information.>> The report shall 

be publicly available and updated at least every 5 years.

 Subtitle F--Access to Federal Lands

SEC. 361. FEDERAL ONSHORE OIL AND GAS LEASING AND PERMITTING PRACTICES.

 (a) Review of Onshore Oil and Gas Leasing Practices.--

 (1) In general.--The Secretary of the Interior, in 

 consultation with the Secretary of Agriculture with respect to 

 National Forest System lands under the jurisdiction of the 

 Department of Agriculture, shall perform an internal review of 

 current Federal onshore oil and gas leasing and permitting 

 practices.

 (2) Inclusions.--The review shall include the process for--

 (A) accepting or rejecting offers to lease;

[[Page 119 STAT. 721]]

 (B) administrative appeals of decisions or orders of 

 officers or employees of the Bureau of Land Management 

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 with respect to a Federal oil or gas lease;

 (C) considering surface use plans of operation, 

 including the timeframes in which the plans are 

 considered, and any recommendations for improving and 

 expediting the process; and

 (D) identifying stipulations to address site-

 specific concerns and conditions, including those 

 stipulations relating to the environment and resource 

 use conflicts.

 (b) Report.--Not later than 180 days after the date of enactment of 

this Act, the Secretary of the Interior and the Secretary of Agriculture 

shall transmit a report to Congress that describes--

 (1) actions taken under section 3 of Executive Order No. 

 13212 (42 U.S.C. 13201 note); and

 (2) actions taken or any plans to improve the Federal 

 onshore oil and gas leasing program.

SEC. 362. <<NOTE: 42 USC 15921.>> MANAGEMENT OF FEDERAL OIL AND GAS 

 LEASING PROGRAMS.

 (a) Timely Action on Leases and Permits.--

 (1) Secretary of the interior.--To ensure timely action on 

 oil and gas leases and applications for permits to drill on land 

 otherwise available for leasing, the Secretary of the Interior 

 (referred to in this section as the ``Secretary'') shall--

 (A) ensure expeditious compliance with section 

 102(2)(C) of the National Environmental Policy Act of 

 1969 (42 U.S.C. 4332(2)(C)) and any other applicable 

 environmental and cultural resources laws;

 (B) improve consultation and coordination with the 

 States and the public; and

 (C) improve the collection, storage, and retrieval 

 of information relating to the oil and gas leasing 

 activities.

 (2) Secretary of agriculture.--To ensure timely action on 

 oil and gas lease applications for permits to drill on land 

 otherwise available for leasing, the Secretary of Agriculture 

 shall--

 (A) ensure expeditious compliance with all 

 applicable environmental and cultural resources laws; 

 and

 (B) improve the collection, storage, and retrieval 

 of information relating to the oil and gas leasing 

 activities.

 (b) Best Management Practices.--

 (1) In general.--Not <<NOTE: Deadline.>> later than 18 

 months after the date of enactment of this Act, the Secretary 

 shall develop and implement best management practices to--

 (A) improve the administration of the onshore oil 

 and gas leasing program under the Mineral Leasing Act 

 (30 U.S.C. 181 et seq.); and

 (B) ensure timely action on oil and gas leases and 

 applications for permits to drill on land otherwise 

 available for leasing.

 (2) Considerations.--In developing the best management 

 practices under paragraph (1), the Secretary shall consider any 

 recommendations from the review under section 361.

 (3) Regulations.--Not <<NOTE: Deadline.>> later than 180 

 days after the development of the best management practices 

 under paragraph (1), the Secretary shall publish, for public 

 comment,

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[[Page 119 STAT. 722]]

 proposed regulations that set forth specific timeframes for 

 processing leases and applications in accordance with the best 

 management practices, including deadlines for--

 (A) approving or disapproving--

 (i) resource management plans and related 

 documents;

 (ii) lease applications;

 (iii) applications for permits to drill; and

 (iv) surface use plans; and

 (B) related administrative appeals.

 (c) Improved Enforcement.--The Secretary and the Secretary of 

Agriculture shall improve inspection and enforcement of oil and gas 

activities, including enforcement of terms and conditions in permits to 

drill on land under the jurisdiction of the Secretary and the Secretary 

of Agriculture, respectively.

 (d) Authorization of Appropriations.--In addition to amounts made 

available to carry out activities relating to oil and gas leasing on 

public land administered by the Secretary and National Forest System 

land administered by the Secretary of Agriculture, there are authorized 

to be appropriated for each of fiscal years 2006 through 2010--

 (1) to the Secretary, acting through the Director of the 

 Bureau of Land Management--

 (A) $40,000,000 to carry out subsections (a)(1) and 

 (b); and

 (B) $20,000,000 to carry out subsection (c);

 (2) to the Secretary, acting through the Director of the 

 United States Fish and Wildlife Service, $5,000,000 to carry out 

 subsection (a)(1); and

 (3) to the Secretary of Agriculture, acting through the 

 Chief of the Forest Service, $5,000,000 to carry out subsections 

 (a)(2) and (c).

SEC. 363. <<NOTE: 42 USC 15922.>> CONSULTATION REGARDING OIL AND GAS 

 LEASING ON PUBLIC LAND.

 (a) In General.--Not <<NOTE: Deadline. Memorandum.>> later than 180 

days after the date of enactment of this Act, the Secretary of the 

Interior and the Secretary of Agriculture shall enter into a memorandum 

of understanding regarding oil and gas leasing on--

 (1) public land under the jurisdiction of the Secretary of 

 the Interior; and

 (2) National Forest System land under the jurisdiction of 

 the Secretary of Agriculture.

 (b) Contents.--The memorandum of understanding shall include 

provisions that--

 (1) establish administrative procedures and lines of 

 authority that ensure timely processing of--

 (A) oil and gas lease applications;

 (B) surface use plans of operation, including steps 

 for processing surface use plans; and

 (C) applications for permits to drill consistent 

 with applicable timelines;

 (2) eliminate duplication of effort by providing for 

 coordination of planning and environmental compliance efforts;

 (3) ensure that lease stipulations are--

 (A) applied consistently;

 (B) coordinated between agencies; and

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[[Page 119 STAT. 723]]

 (C) only as restrictive as necessary to protect the 

 resource for which the stipulations are applied;

 (4) establish a joint data retrieval system that is capable 

 of--

 (A) tracking applications and formal requests made 

 in accordance with procedures of the Federal onshore oil 

 and gas leasing program; and

 (B) providing information regarding the status of 

 the applications and requests within the Department of 

 the Interior and the Department of Agriculture; and

 (5) establish a joint geographic information system mapping 

 system for use in--

 (A) tracking surface resource values to aid in 

 resource management; and

 (B) processing surface use plans of operation and 

 applications for permits to drill.

SEC. 364. ESTIMATES OF OIL AND GAS RESOURCES UNDERLYING ONSHORE FEDERAL 

 LAND.

 (a) Assessment.--Section 604 of the Energy Act of 2000 (42 U.S.C. 

6217) is amended--

 (1) in subsection (a)--

 (A) in paragraph (1)--

 (i) by striking ``reserve''; and

 (ii) by striking ``and'' after the semicolon; 

 and

 (B) by striking paragraph (2) and inserting the 

 following:

 ``(2) the extent and nature of any restrictions or 

 impediments to the development of the resources, including--

 ``(A) impediments to the timely granting of leases;

 ``(B) post-lease restrictions, impediments, or 

 delays on development for conditions of approval, 

 applications for permits to drill, or processing of 

 environmental permits; and

 ``(C) permits or restrictions associated with 

 transporting the resources for entry into commerce; and

 ``(3) the quantity of resources not produced or introduced 

 into commerce because of the restrictions.'';

 (2) in subsection (b)--

 (A) by striking ``reserve'' and inserting 

 ``resource''; and

 (B) by striking ``publically'' and inserting 

 ``publicly''; and

 (3) by striking subsection (d) and inserting the following:

 ``(d) Assessments.--Using the inventory, the Secretary of Energy 

shall make periodic assessments of economically recoverable resources 

accounting for a range of parameters such as current costs, commodity 

prices, technology, and regulations.''.

 (b) Methodology.--The <<NOTE: 42 USC 15923.>> Secretary of the 

Interior shall use the same assessment methodology across all geological 

provinces, areas, and regions in preparing and issuing national 

geological assessments to ensure accurate comparisons of geological 

resources.

SEC. 365. <<NOTE: 42 USC 15924.>> PILOT PROJECT TO IMPROVE FEDERAL 

 PERMIT COORDINATION.

 (a) Establishment.--The Secretary of the Interior (referred to in 

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this section as the ``Secretary'') shall establish a Federal Permit 

Streamlining Pilot Project (referred to in this section as the ``Pilot 

Project'').

[[Page 119 STAT. 724]]

 (b) Memorandum of Understanding.--

 (1) In general.--Not <<NOTE: Deadline.>> later than 90 days 

 after the date of enactment of this Act, the Secretary shall 

 enter into a memorandum of understanding for purposes of this 

 section with--

 (A) the Secretary of Agriculture;

 (B) the Administrator of the Environmental 

 Protection Agency; and

 (C) the Chief of Engineers.

 (2) State participation.--The Secretary may request that the 

 Governors of Wyoming, Montana, Colorado, Utah, and New Mexico be 

 signatories to the memorandum of understanding.

 (c) Designation of Qualified Staff.--

 (1) In general.--Not <<NOTE: Deadline.>> later than 30 days 

 after the date of the signing of the memorandum of understanding 

 under subsection (b), all Federal signatory parties shall, if 

 appropriate, assign to each of the field offices identified in 

 subsection (d) an employee who has expertise in the regulatory 

 issues relating to the office in which the employee is employed, 

 including, as applicable, particular expertise in--

 (A) the consultations and the preparation of 

 biological opinions under section 7 of the Endangered 

 Species Act of 1973 (16 U.S.C. 1536);

 (B) permits under section 404 of Federal Water 

 Pollution Control Act (33 U.S.C. 1344);

 (C) regulatory matters under the Clean Air Act (42 

 U.S.C. 7401 et seq.);

 (D) planning under the National Forest Management 

 Act of 1976 (16 U.S.C. 472a et seq.); and

 (E) the preparation of analyses under the National 

 Environmental Policy Act of 1969 (42 U.S.C. 4321 et 

 seq.).

 (2) Duties.--Each employee assigned under paragraph (1) 

 shall--

 (A) <<NOTE: Deadline.>> not later than 90 days after 

 the date of assignment, report to the Bureau of Land 

 Management Field Managers in the office to which the 

 employee is assigned;

 (B) be responsible for all issues relating to the 

 jurisdiction of the home office or agency of the 

 employee; and

 (C) participate as part of the team of personnel 

 working on proposed energy projects, planning, and 

 environmental analyses.

 (d) Field Offices.--The following Bureau of Land Management Field 

Offices shall serve as the Pilot Project offices:

 (1) Rawlins, Wyoming.

 (2) Buffalo, Wyoming.

 (3) Miles City, Montana.

 (4) Farmington, New Mexico.

 (5) Carlsbad, New Mexico.

 (6) Grand Junction/Glenwood Springs, Colorado.

 (7) Vernal, Utah.

 (e) Reports.--Not later than 3 years after the date of enactment of 

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this Act, the Secretary shall submit to Congress a report that--

 (1) outlines the results of the Pilot Project to date; and

 (2) makes a recommendation to the President regarding 

 whether the Pilot Project should be implemented throughout the 

 United States.

[[Page 119 STAT. 725]]

 (f) Additional Personnel.--The Secretary shall assign to each field 

office identified in subsection (d) any additional personnel that are 

necessary to ensure the effective implementation of--

 (1) the Pilot Project; and

 (2) other programs administered by the field offices, 

 including inspection and enforcement relating to energy 

 development on Federal land, in accordance with the multiple use 

 mandate of the Federal Land Policy and Management Act of 1976 

 (43 U.S.C. 1701 et seq.).

 (g) Permit Processing Improvement Fund.--Section 35 of the Mineral 

Leasing Act (30 U.S.C. 191) is amended by adding at the end the 

following:

 ``(c)(1) Notwithstanding the first sentence of subsection (a), any 

rentals received from leases in any State (other than the State of 

Alaska) on or after the date of enactment of this subsection shall be 

deposited in the Treasury, to be allocated in accordance with paragraph 

(2).

 ``(2) Of the amounts deposited in the Treasury under paragraph (1)--

 ``(A) 50 percent shall be paid by the Secretary of the 

 Treasury to the State within the boundaries of which the leased 

 land is located or the deposits were derived; and

 ``(B) 50 percent shall be deposited in a special fund in the 

 Treasury, to be known as the `BLM Permit Processing Improvement 

 Fund' (referred to in this subsection as the `Fund').

 ``(3) For each of fiscal years 2006 through 2015, the Fund shall be 

available to the Secretary of the Interior for expenditure, without 

further appropriation and without fiscal year limitation, for the 

coordination and processing of oil and gas use authorizations on onshore 

Federal land under the jurisdiction of the Pilot Project offices 

identified in section 365(d) of the Energy Policy Act of 2005.''.

 (h) Transfer of Funds.--For the purposes of coordination and 

processing of oil and gas use authorizations on Federal land under the 

administration of the Pilot Project offices identified in subsection 

(d), the Secretary may authorize the expenditure or transfer of such 

funds as are necessary to--

 (1) the United States Fish and Wildlife Service;

 (2) the Bureau of Indian Affairs;

 (3) the Forest Service;

 (4) the Environmental Protection Agency;

 (5) the Corps of Engineers; and

 (6) the States of Wyoming, Montana, Colorado, Utah, and New 

 Mexico.

 (i) Fees.--During the period in which the Pilot Project is 

authorized, the Secretary shall not implement a rulemaking that would 

enable an increase in fees to recover additional costs related to 

processing drilling-related permit applications and use authorizations.

 (j) Savings Provision.--Nothing in this section affects--

 (1) the operation of any Federal or State law; or

 (2) any delegation of authority made by the head of a 

 Federal agency whose employees are participating in the Pilot 

 Project.

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[[Page 119 STAT. 726]]

SEC. 366. DEADLINE FOR CONSIDERATION OF APPLICATIONS FOR PERMITS.

 Section 17 of the Mineral Leasing Act (30 U.S.C. 226) is amended by 

adding at the end the following:

 ``(p) Deadlines for Consideration of Applications for Permits.--

 ``(1) In general.--Not <<NOTE: Notification.>> later than 10 

 days after the date on which the Secretary receives an 

 application for any permit to drill, the Secretary shall--

 ``(A) notify the applicant that the application is 

 complete; or

 ``(B) notify the applicant that information is 

 missing and specify any information that is required to 

 be submitted for the application to be complete.

 ``(2) Issuance or deferral.--Not later than 30 days after 

 the applicant for a permit has submitted a complete application, 

 the Secretary shall--

 ``(A) issue the permit, if the requirements under 

 the National Environmental Policy Act of 1969 and other 

 applicable law have been completed within such 

 timeframe; or

 ``(B) <<NOTE: Notice.>> defer the decision on the 

 permit and provide to the applicant a notice--

 ``(i) that specifies any steps that the 

 applicant could take for the permit to be issued; 

 and

 ``(ii) a list of actions that need to be taken 

 by the agency to complete compliance with 

 applicable law together with timelines and 

 deadlines for completing such actions.

 ``(3) Requirements for deferred applications.--

 ``(A) In general.--If the Secretary provides notice 

 under paragraph (2)(B), the applicant shall have a 

 period of 2 years from the date of receipt of the notice 

 in which to complete all requirements specified by the 

 Secretary, including providing information needed for 

 compliance with the National Environmental Policy Act of 

 1969.

 ``(B) Issuance of decision on permit.--If the 

 applicant completes the requirements within the period 

 specified in subparagraph (A), the Secretary shall issue 

 a decision on the permit not later than 10 days after 

 the date of completion of the requirements described in 

 subparagraph (A), unless compliance with the National 

 Environmental Policy Act of 1969 and other applicable 

 law has not been completed within such timeframe.

 ``(C) Denial of permit.--If the applicant does not 

 complete the requirements within the period specified in 

 subparagraph (A) or if the applicant does not comply 

 with applicable law, the Secretary shall deny the 

 permit.''.

SEC. 367. <<NOTE: 42 USC 15925.>> FAIR MARKET VALUE DETERMINATIONS FOR 

 LINEAR RIGHTS-OF-WAY ACROSS PUBLIC LANDS AND NATIONAL 

 FORESTS.

 (a) Update of Fee Schedule.--Not <<NOTE: Deadline.>> later than 1 

year after the date of enactment of this section--

 (1) the Secretary of the Interior shall update section 

 2806.20 of title 43, Code of Federal Regulations, as in effect 

 on the date of enactment of this section, to revise the per

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[[Page 119 STAT. 727]]

 acre rental fee zone value schedule by State, county, and type 

 of linear right-of-way use to reflect current values of land in 

 each zone; and

 (2) the Secretary of Agriculture shall make the same 

 revision for linear rights-of-way granted, issued, or renewed 

 under title V of the Federal Lands Policy and Management Act of 

 1976 (43 U.S.C. 1761 et seq.) on National Forest System land.

 (b) Fair Market Value Rental Determination for Linear Rights-ofway.--The fair market value rent of a linear right-of-way across public 

lands or National Forest System lands issued under section 504 of the 

Federal Land Policy and Management Act of 1976 (43 U.S.C. 1764) or 

section 28 of the Mineral Leasing Act (30 U.S.C. 185) shall be 

determined in accordance with subpart 2806 of title 43, Code of Federal 

Regulations, as in effect on the date of enactment of this section 

(including the annual or periodic updates specified in the regulations) 

and as updated in accordance with subsection (a).

SEC. 368. <<NOTE: 42 USC 15926.>> ENERGY RIGHT-OF-WAY CORRIDORS ON 

 FEDERAL LAND.

 (a) Western States.--Not <<NOTE: Deadline.>> later than 2 years 

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

the Secretary of Commerce, the Secretary of Defense, the Secretary of 

Energy, and the Secretary of the Interior (in this section referred to 

collectively as ``the Secretaries''), in consultation with the Federal 

Energy Regulatory Commission, States, tribal or local units of 

governments as appropriate, affected utility industries, and other 

interested persons, shall consult with each other and shall--

 (1) designate, under their respective authorities, corridors 

 for oil, gas, and hydrogen pipelines and electricity 

 transmission and distribution facilities on Federal land in the 

 eleven contiguous Western States (as defined in section 103(o) 

 of the Federal Land Policy and Management Act of 1976 (43 U.S.C. 

 1702(o));

 (2) perform any environmental reviews that may be required 

 to complete the designation of such corridors; and

 (3) incorporate the designated corridors into the relevant 

 agency land use and resource management plans or equivalent 

 plans.

 (b) Other States.--Not <<NOTE: Deadline.>> later than 4 years after 

the date of enactment of this Act, the Secretaries, in consultation with 

the Federal Energy Regulatory Commission, affected utility industries, 

and other interested persons, shall jointly--

 (1) identify corridors for oil, gas, and hydrogen pipelines 

 and electricity transmission and distribution facilities on 

 Federal land in States other than those described in subsection 

 (a); and

 (2) schedule prompt action to identify, designate, and 

 incorporate the corridors into the applicable land use plans.

 (c) Ongoing Responsibilities.--

The <<NOTE: Procedures.>> Secretaries, in consultation with the Federal 

Energy Regulatory Commission, affected utility industries, and other 

interested parties, shall establish procedures under their respective 

authorities that--

 (1) ensure that additional corridors for oil, gas, and 

 hydrogen pipelines and electricity transmission and distribution 

 facilities on Federal land are promptly identified and 

 designated as necessary; and

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[[Page 119 STAT. 728]]

 (2) expedite applications to construct or modify oil, gas, 

 and hydrogen pipelines and electricity transmission and 

 distribution facilities within such corridors, taking into 

 account prior analyses and environmental reviews undertaken 

 during the designation of such corridors.

 (d) Considerations.--In carrying out this section, the Secretaries 

shall take into account the need for upgraded and new electricity 

transmission and distribution facilities to--

 (1) improve reliability;

 (2) relieve congestion; and

 (3) enhance the capability of the national grid to deliver 

 electricity.

 (e) Specifications of Corridor.--A corridor designated under this 

section shall, at a minimum, specify the centerline, width, and 

compatible uses of the corridor.

SEC. 369. <<NOTE: Oil Shale, Tar Sands, and Other Strategic 

 Unconventional Fuels Act of 2005. Deadlines. 42 USC 

 15927.>> OIL SHALE, TAR SANDS, AND OTHER STRATEGIC 

 UNCONVENTIONAL FUELS.

 (a) Short Title.--This section may be cited as the ``Oil Shale, Tar 

Sands, and Other Strategic Unconventional Fuels Act of 2005''.

 (b) Declaration of Policy.--Congress declares that it is the policy 

of the United States that--

 (1) United States oil shale, tar sands, and other 

 unconventional fuels are strategically important domestic 

 resources that should be developed to reduce the growing 

 dependence of the United States on politically and economically 

 unstable sources of foreign oil imports;

 (2) the development of oil shale, tar sands, and other 

 strategic unconventional fuels, for research and commercial 

 development, should be conducted in an environmentally sound 

 manner, using practices that minimize impacts; and

 (3) development of those strategic unconventional fuels 

 should occur, with an emphasis on sustainability, to benefit the 

 United States while taking into account affected States and 

 communities.

 (c) Leasing Program for Research and Development of Oil Shale and 

Tar Sands.--In accordance with section 21 of the Mineral Leasing Act (30 

U.S.C. 241) and any other applicable law, except as provided in this 

section, not later than 180 days after the date of enactment of this 

Act, from land otherwise available for leasing, the Secretary of the 

Interior (referred to in this section as the ``Secretary'') shall make 

available for leasing such land as the Secretary considers to be 

necessary to conduct research and development activities with respect to 

technologies for the recovery of liquid fuels from oil shale and tar 

sands resources on public lands. Prospective public lands within each of 

the States of Colorado, Utah, and Wyoming shall be made available for 

such research and development leasing.

 (d) Programmatic Environmental Impact Statement and Commercial 

Leasing Program for Oil Shale and Tar Sands.--

 (1) Programmatic environmental impact statement.--Not later 

 than 18 months after the date of enactment of this Act, in 

 accordance with section 102(2)(C) of the National Environmental 

 Policy Act of 1969 (42 U.S.C. 4332(2)(C)), the Secretary shall 

 complete a programmatic environmental impact statement for a 

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 commercial leasing program for oil shale and tar sands resources 

 on public lands, with an emphasis on

[[Page 119 STAT. 729]]

 the most geologically prospective lands within each of the 

 States of Colorado, Utah, and Wyoming.

 (2) Final regulation.--Not later than 6 months after the 

 completion of the programmatic environmental impact statement 

 under this subsection, the Secretary shall publish a final 

 regulation establishing such program.

 (e) Commencement of Commercial Leasing of Oil Shale and Tar Sands.--

Not later than 180 days after publication of the final regulation 

required by subsection (d), the Secretary shall consult with the 

Governors of States with significant oil shale and tar sands resources 

on public lands, representatives of local governments in such States, 

interested Indian tribes, and other interested persons, to determine the 

level of support and interest in the States in the development of tar 

sands and oil shale resources. If the Secretary finds sufficient support 

and interest exists in a State, the Secretary may conduct a lease sale 

in that State under the commercial leasing program regulations. Evidence 

of interest in a lease sale under this subsection shall include, but not 

be limited to, appropriate areas nominated for leasing by potential 

lessees and other interested parties.

 (f) Diligent Development Requirements.--

The <<NOTE: Regulations.>> Secretary shall, by regulation, designate 

work requirements and milestones to ensure the diligent development of 

the lease.

 (g) Initial Report by the Secretary of the Interior.--Within 90 days 

after the date of enactment of this Act, the Secretary of the Interior 

shall report to the Committee on Resources of the House of 

Representatives and the Committee on Energy and Natural Resources of the 

Senate on--

 (1) the interim actions necessary to--

 (A) develop the program, complete the programmatic 

 environmental impact statement, and promulgate the final 

 regulation as required by subsection (d); and

 (B) conduct the first lease sales under the program 

 as required by subsection (e); and

 (2) a schedule to complete such actions within the time 

 limits mandated by this section.

 (h) Task Force.--

 (1) Establishment.--The Secretary of Energy, in cooperation 

 with the Secretary of the Interior and the Secretary of Defense, 

 shall establish a task force to develop a program to coordinate 

 and accelerate the commercial development of strategic 

 unconventional fuels, including but not limited to oil shale and 

 tar sands resources within the United States, in an integrated 

 manner.

 (2) Composition.--The Task Force shall be composed of--

 (A) the Secretary of Energy (or the designee of the 

 Secretary);

 (B) the Secretary of the Interior (or the designee 

 of the Secretary of the Interior);

 (C) the Secretary of Defense (or the designee of the 

 Secretary of Defense);

 (D) the Governors of affected States; and

 (E) representatives of local governments in affected 

 areas.

 (3) Recommendations.--The Task Force shall make such 

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 recommendations regarding promoting the development of the

[[Page 119 STAT. 730]]

 strategic unconventional fuels resources within the United 

 States as it may deem appropriate.

 (4) Partnerships.--The Task Force shall make recommendations 

 with respect to initiating a partnership with the Province of 

 Alberta, Canada, for purposes of sharing information relating to 

 the development and production of oil from tar sands, and 

 similar partnerships with other nations that contain significant 

 oil shale resources.

 (5) Reports.--

 (A) Initial report.--Not later than 180 days after 

 the date of enactment of this Act, the Task Force shall 

 submit to the President and Congress a report that 

 describes the analysis and recommendations of the Task 

 Force.

 (B) Subsequent reports.--The Secretary shall provide 

 an annual report describing the progress in developing 

 the strategic unconventional fuels resources within the 

 United States for each of the 5 years following 

 submission of the report provided for in subparagraph 

 (A).

 (i) Office of <<NOTE: Establishment.>> Petroleum Reserves.--

 (1) In general.--The Office of Petroleum Reserves of the 

 Department of Energy shall--

 (A) coordinate the creation and implementation of a 

 commercial strategic fuel development program for the 

 United States;

 (B) evaluate the strategic importance of 

 unconventional sources of strategic fuels to the 

 security of the United States;

 (C) promote and coordinate Federal Government 

 actions that facilitate the development of strategic 

 fuels in order to effectively address the energy supply 

 needs of the United States;

 (D) identify, assess, and recommend appropriate 

 actions of the Federal Government required to assist in 

 the development and manufacturing of strategic fuels; 

 and

 (E) coordinate and facilitate appropriate 

 relationships between private industry and the Federal 

 Government to promote sufficient and timely private 

 investment to commercialize strategic fuels for domestic 

 and military use.

 (2) Consultation and coordination.--The Office of Petroleum 

 Reserves shall work closely with the Task Force and coordinate 

 its staff support.

 (3) Annual reports.--Not later than 180 days after the date 

 of enactment of this Act and annually thereafter, the Secretary 

 shall submit to Congress a report that describes the activities 

 of the Office of Petroleum Reserves carried out under this 

 subsection.

 (j) Mineral Leasing Act Amendments.--

 (1) Section 17.--Section 17(b)(2) of the Mineral Leasing Act 

 (30 U.S.C. 226(b)(2)), as amended by section 350, is further 

 amended--

 (A) in subparagraph (A) (as designated by the 

 amendment made by subsection (a)(1) of that section) by 

 designating the first, second, and third sentences as 

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 clauses (i), (ii), and (iii), respectively;

 (B) by moving clause (ii), as so designated, so as 

 to begin immediately after and below clause (i);

[[Page 119 STAT. 731]]

 (C) by moving clause (iii), as so designated, so as 

 to begin immediately after and below clause (ii);

 (D) in clause (i) of subparagraph (A) (as designated 

 by subparagraph (A) of this paragraph) by striking 

 ``five thousand one hundred and twenty'' and inserting 

 ``5,760''; and

 (E) by adding at the end the following:

 ``(iv) No lease issued under this paragraph shall be 

 included in any chargeability limitation associated with oil and 

 gas leases.''.

 (2) Section 21.--Section 21(a) of the Mineral Leasing Act 

 (30 U.S.C. 241(a)) is amended--

 (A) by striking ``(a) That the Secretary'' and 

 inserting the following:

 ``(a)(1) The Secretary'';

 (B) by striking ``; that no lease'' and inserting a 

 period, followed by the following:

 ``(2) No lease'';

 (C) by striking ``Leases may be for'' and inserting 

 the following:

 ``(3) Leases may be for'';

 (D) by striking ``For the privilege'' and inserting 

 the following:

 ``(4) For the privilege'';

 (E) in paragraph (2) (as designated by subparagraph 

 (B) of this paragraph) by striking ``five thousand one 

 hundred and twenty'' and inserting ``5,760'';

 (F) in paragraph (4) (as designated by subparagraph 

 (D) of this paragraph) by striking ``rate of 50 cents 

 per acre'' and inserting ``rate of $2.00 per acre'';

 (G)(i) by striking ``: Provided further, That not 

 more than one lease shall be granted under this section 

 to any'' and inserting ``: Provided further, That no''; 

 and

 (ii) by striking ``except that with respect to 

 leases for'' and inserting ``shall acquire or hold more 

 than 50,000 acres of oil shale leases in any one State. 

 For''; and

 (H) by adding at the end the following:

 ``(5) No lease issued under this section shall be included 

 in any chargeability limitation associated with oil and gas 

 leases.''.

 (k) Interagency Coordination and Expeditious Review of Permitting 

Process.--

 (1) Department of the interior as lead agency.--Upon written 

 request of a prospective applicant for Federal authorization to 

 develop a proposed oil shale or tar sands project, the 

 Department of the Interior shall act as the lead Federal agency 

 for the purposes of coordinating all applicable Federal 

 authorizations and environmental reviews. To the maximum extent 

 practicable under applicable Federal law, the Secretary shall 

 coordinate this Federal authorization and review process with 

 any Indian tribes and State and local agencies responsible for 

 conducting any separate permitting and environmental reviews.

 (2) Implementing regulations.--Not later than 6 months after 

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 the date of enactment of this Act, the Secretary shall issue any 

 regulations necessary to implement this subsection.

 (l) Cost-shared Demonstration Technologies.--

[[Page 119 STAT. 732]]

 (1) Identification.--The Secretary of Energy shall identify 

 technologies for the development of oil shale and tar sands 

 that--

 (A) are ready for demonstration at a commercially-

 representative scale; and

 (B) have a high probability of leading to commercial 

 production.

 (2) Assistance.--For each technology identified under 

 paragraph (1), the Secretary of Energy may provide--

 (A) technical assistance;

 (B) assistance in meeting environmental and 

 regulatory requirements; and

 (C) cost-sharing assistance.

 (m) National Oil Shale and Tar Sands Assessment.--

 (1) Assessment.--

 (A) In general.--The Secretary shall carry out a 

 national assessment of oil shale and tar sands resources 

 for the purposes of evaluating and mapping oil shale and 

 tar sands deposits, in the geographic areas described in 

 subparagraph (B). In conducting such an assessment, the 

 Secretary shall make use of the extensive geological 

 assessment work for oil shale and tar sands already 

 conducted by the United States Geological Survey.

 (B) Geographic areas.--The geographic areas referred 

 to in subparagraph (A), listed in the order in which the 

 Secretary shall assign priority, are--

 (i) the Green River Region of the States of 

 Colorado, Utah, and Wyoming;

 (ii) the Devonian oil shales and other 

 hydrocarbon-bearing rocks having the nomenclature 

 of ``shale'' located east of the Mississippi 

 River; and

 (iii) any remaining area in the central and 

 western United States (including the State of 

 Alaska) that contains oil shale and tar sands, as 

 determined by the Secretary.

 (2) Use of state surveys and universities.--In carrying out 

 the assessment under paragraph (1), the Secretary may request 

 assistance from any State-administered geological survey or 

 university.

 (n) Land Exchanges.--

 (1) In general.--To facilitate the recovery of oil shale and 

 tar sands, especially in areas where Federal, State, and private 

 lands are intermingled, the Secretary shall consider the use of 

 land exchanges where appropriate and feasible to consolidate 

 land ownership and mineral interests into manageable areas.

 (2) Identification and priority of public lands.--The 

 Secretary shall identify public lands containing deposits of oil 

 shale or tar sands within the Green River, Piceance Creek, 

 Uintah, and Washakie geologic basins, and shall give priority to 

 implementing land exchanges within those basins. The Secretary 

 shall consider the geology of the respective basin in 

 determining the optimum size of the lands to be consolidated.

 (3) Compliance with section 206 of flpma.--A land exchange 

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 undertaken in furtherance of this subsection shall be 

 implemented in accordance with section 206 of the Federal Land 

 Policy and Management Act of 1976 (43 U.S.C. 1716).

[[Page 119 STAT. 733]]

 (o) Royalty Rates for Leases.--The Secretary shall establish 

royalties, fees, rentals, bonus, or other payments for leases under this 

section that shall--

 (1) encourage development of the oil shale and tar sands 

 resource; and

 (2) ensure a fair return to the United States.

 (p) Heavy Oil Technical and Economic Assessment.--The Secretary of 

Energy shall update the 1987 technical and economic assessment of 

domestic heavy oil resources that was prepared by the Interstate Oil and 

Gas Compact Commission. Such an update should include all of North 

America and cover all unconventional oil, including heavy oil, tar sands 

(oil sands), and oil shale.

 (q) Procurement of Unconventional Fuels by the Department of 

Defense.--

 (1) In general.--Chapter 141 of title 10, United States 

 Code, is amended by inserting after section 2398 the following:

``Sec. 2398a. Procurement of fuel derived from coal, oil shale, and tar 

 sands

 ``(a) Use of Fuel to Meet Department of Defense Needs.--The 

Secretary of Defense shall develop a strategy to use fuel produced, in 

whole or in part, from coal, oil shale, and tar sands (referred to in 

this section as a `covered fuel') that are extracted by either mining or 

in-situ methods and refined or otherwise processed in the United States 

in order to assist in meeting the fuel requirements of the Department of 

Defense when the Secretary determines that it is in the national 

interest.

 ``(b) Authority to Procure.--The Secretary of Defense may enter into 

1 or more contracts or other agreements (that meet the requirements of 

this section) to procure a covered fuel to meet 1 or more fuel 

requirements of the Department of Defense.

 ``(c) Clean Fuel Requirements.--A covered fuel may be procured under 

subsection (b) only if the covered fuel meets such standards for clean 

fuel produced from domestic sources as the Secretary of Defense shall 

establish for purposes of this section in consultation with the 

Department of Energy.

 ``(d) Multiyear Contract Authority.--Subject to applicable 

provisions of law, any contract or other agreement for the procurement 

of covered fuel under subsection (b) may be for 1 or more years at the 

election of the Secretary of Defense.

 ``(e) Fuel Source Analysis.--In order to facilitate the procurement 

by the Department of Defense of covered fuel under subsection (b), the 

Secretary of Defense may carry out a comprehensive assessment of current 

and potential locations in the United States for the supply of covered 

fuel to the Department.''.

 (2) Clerical amendment.--The table of sections for chapter 

 141 of title 10, United States Code, is amended by inserting 

 after the item relating to section 2398 the following:

``2398a. Procurement of fuel derived from coal, oil shale, and tar 

 sands.''.

 (r) State Water Rights.--Nothing in this section preempts or affects 

any State water law or interstate compact relating to water.

 (s) Authorization of Appropriations.--There are authorized to be 

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appropriated such sums as are necessary to carry out this section.

[[Page 119 STAT. 734]]

SEC. 370. FINGER LAKES WITHDRAWAL.

 All Federal land within the boundary of Finger Lakes National Forest 

in the State of New York is withdrawn from--

 (1) all forms of entry, appropriation, or disposal under the 

 public land laws; and

 (2) disposition under all laws relating to oil and gas 

 leasing.

SEC. 371. <<NOTE: 30 USC 188 note.>> REINSTATEMENT OF LEASES.

 (a) Leases <<NOTE: Effective date. Termination date.>> Terminated 

for Certain Failure to Pay Rental.--Notwithstanding section 31(d)(2)(B) 

of the Mineral Leasing Act (30 U.S.C. 188(d)(2)(B)) as in effect before 

the effective date of this section, and notwithstanding the amendment 

made by subsection (b) of this section, the Secretary of the Interior 

may reinstate any oil and gas lease issued under that Act that was 

terminated for failure of a lessee to pay the full amount of rental on 

or before the anniversary date of the lease, during the period beginning 

on September 1, 2001, and ending on June 30, 2004, if--

 (1) <<NOTE: Deadline.>> not later than 120 days after the 

 date of enactment of this Act, the lessee--

 (A) files a petition for reinstatement of the lease;

 (B) complies with the conditions of section 31(e) of 

 the Mineral Leasing Act (30 U.S.C. 188(e)); and

 (C) <<NOTE: Certification.>> certifies that the 

 lessee did not receive a notice of termination by the 

 date that was 13 months before the date of termination; 

 and

 (2) the land is available for leasing.

 (b) Deadline for Petitions, Generally.--Section 31(d)(2) of the 

Mineral Leasing Act (30 U.S.C. 188(d)(2)) is amended by striking 

subparagraphs (A) and (B) and inserting the following:

 ``(A) with respect to any lease that terminated 

 under subsection (b) on or before the date of the 

 enactment of the Energy Policy Act of 2005, a petition 

 for reinstatement (together with the required back 

 rental and royalty accruing after the date of 

 termination) is filed on or before the earlier of--

 ``(i) 60 days after the lessee receives from 

 the Secretary notice of termination, whether by 

 return of check or by any other form of actual 

 notice; or

 ``(ii) 15 months after the termination of the 

 lease; or

 ``(B) with respect to any lease that terminates 

 under subsection (b) after the date of the enactment of 

 the Energy Policy Act of 2005, a petition for 

 reinstatement (together with the required back rental 

 and royalty accruing after the date of termination) is 

 filed on or before the earlier of--

 ``(i) 60 days after receipt of the notice of 

 termination sent by the Secretary by certified 

 mail to all lessees of record; or

 ``(ii) 24 months after the termination of the 

 lease.''.

SEC. 372. <<NOTE: 42 USC 15928.>> CONSULTATION REGARDING ENERGY RIGHTSPage 146 of 559

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 OF-WAY ON PUBLIC LAND.

 (a) Memorandum of Understanding.--

[[Page 119 STAT. 735]]

 (1) In general.--Not <<NOTE: Deadline.>> later than 6 months 

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

 Energy, in consultation with the Secretary of the Interior, the 

 Secretary of Agriculture, and the Secretary of Defense with 

 respect to lands under their respective jurisdictions, shall 

 enter into a memorandum of understanding to coordinate all 

 applicable Federal authorizations and environmental reviews 

 relating to a proposed or existing utility facility. To the 

 maximum extent practicable under applicable law, the Secretary 

 of Energy shall, to ensure timely review and permit decisions, 

 coordinate such authorizations and reviews with any Indian 

 tribes, multi-State entities, and State agencies that are 

 responsible for conducting any separate permitting and 

 environmental reviews of the affected utility facility.

 (2) Contents.--The memorandum of understanding shall include 

 provisions that--

 (A) establish--

 (i) a unified right-of-way application form; 

 and

 (ii) an administrative procedure for 

 processing right-of-way applications, including 

 lines of authority, steps in application 

 processing, and timeframes for application 

 processing;

 (B) provide for coordination of planning relating to 

 the granting of the rights-of-way;

 (C) provide for an agreement among the affected 

 Federal agencies to prepare a single environmental 

 review document to be used as the basis for all Federal 

 authorization decisions; and

 (D) provide for coordination of use of right-of-way 

 stipulations to achieve consistency.

 (b) Natural Gas Pipelines.--

 (1) In general.--With respect to permitting activities for 

 interstate natural gas pipelines, the May 2002 document entitled 

 ``Interagency Agreement On Early Coordination Of Required 

 Environmental And Historic Preservation Reviews Conducted In 

 Conjunction With The Issuance Of Authorizations To Construct And 

 Operate Interstate Natural Gas Pipelines Certificated By The 

 Federal Energy Regulatory Commission'' shall constitute 

 compliance with subsection (a).

 (2) Report.--

 (A) In general.--Not later than 1 year after the 

 date of enactment of this Act, and every 2 years 

 thereafter, agencies that are signatories to the 

 document referred to in paragraph (1) shall transmit to 

 Congress a report on how the agencies under the 

 jurisdiction of the Secretaries are incorporating and 

 implementing the provisions of the document referred to 

 in paragraph (1).

 (B) Contents.--The report shall address--

 (i) efforts to implement the provisions of the 

 document referred to in paragraph (1);

 (ii) whether the efforts have had a 

 streamlining effect;

 (iii) further improvements to the permitting 

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 process of the agency; and

 (iv) recommendations for inclusion of State 

 and tribal governments in a coordinated permitting 

 process.

[[Page 119 STAT. 736]]

 (c) Definition of Utility Facility.--In this section, the term 

``utility facility'' means any privately, publicly, or cooperatively 

owned line, facility, or system--

 (1) for the transportation of--

 (A) oil, natural gas, synthetic liquid fuel, or 

 gaseous fuel;

 (B) any refined product produced from oil, natural 

 gas, synthetic liquid fuel, or gaseous fuel; or

 (C) products in support of the production of 

 material referred to in subparagraph (A) or (B);

 (2) for storage and terminal facilities in connection with 

 the production of material referred to in paragraph (1); or

 (3) for the generation, transmission, and distribution of 

 electric energy.

SEC. 373. SENSE OF CONGRESS REGARDING DEVELOPMENT OF MINERALS UNDER 

 PADRE ISLAND NATIONAL SEASHORE.

 (a) Findings.--Congress finds the following:

 (1) Pursuant to Public Law 87-712 (16 U.S.C. 459d et seq.; 

 popularly known as the ``Federal Enabling Act'') and various 

 deeds and actions under that Act, the United States is the owner 

 of only the surface estate of certain lands constituting the 

 Padre Island National Seashore.

 (2) Ownership of the oil, gas, and other minerals in the 

 subsurface estate of the lands constituting the Padre Island 

 National Seashore was never acquired by the United States, and 

 ownership of those interests is held by the State of Texas and 

 private parties.

 (3) Public Law 87-712 (16 U.S.C. 459d et seq.)--

 (A) expressly contemplated that the United States 

 would recognize the ownership and future development of 

 the oil, gas, and other minerals in the subsurface 

 estate of the lands constituting the Padre Island 

 National Seashore by the owners and their mineral 

 lessees; and

 (B) recognized that approval of the State of Texas 

 was required to create Padre Island National Seashore.

 (4) Approval was given for the creation of Padre Island 

 National Seashore by the State of Texas through Tex. Rev. Civ. 

 Stat. Ann. Art. 6077(t) (Vernon 1970), which expressly 

 recognized that development of the oil, gas, and other minerals 

 in the subsurface of the lands constituting Padre Island 

 National Seashore would be conducted with full rights of ingress 

 and egress under the laws of the State of Texas.

 (b) Sense of Congress.--It is the sense of Congress that with regard 

to Federal law, any regulation of the development of oil, gas, or other 

minerals in the subsurface of the lands constituting Padre Island 

National Seashore should be made as if those lands retained the status 

that the lands had on September 27, 1962.

SEC. 374. <<NOTE: Louisiana.>> LIVINGSTON PARISH MINERAL RIGHTS 

 TRANSFER.

 Section 102 of Public Law 102-562 (106 Stat. 4234) is amended by 

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striking subsection (b) and inserting the following:

 ``(b) Reservation of Oil and Gas Rights and Conveyance of Remaining 

Mineral Rights.--Subject to the limitations set forth in subsection (c), 

the United States hereby excepts and reserves from the provisions of 

subsection (a), all rights to oil and gas underlying such lands, along 

with the right to explore

[[Page 119 STAT. 737]]

for, and produce the oil and gas under applicable law and such 

regulations as the Secretary of the Interior may prescribe. Not later 

than 180 days after the date of enactment of the Energy Policy Act of 

2005, the Secretary of the Interior shall convey the remaining mineral 

rights to the parties who as of the date of enactment of the Energy 

Policy Act of 2005 would be recognized as holders of a right, title, or 

interest to any portion of such minerals under the laws of the State of 

Louisiana, but for the interest of the United States in such minerals.

 ``(c) Oil and Gas <<NOTE: Deadlines.>> Resource Assessment and 

Report.--The United States Geological Survey shall conduct a resource 

assessment and publish a report of the findings of such resource 

assessment (`USGS Assessment and Report') within 1 year of the date of 

enactment of the Energy Policy Act of 2005. The USGS Assessment and 

Report shall provide an assessment of all oil and gas resources 

underlying the certain lands in Livingston Parish, Louisiana, as 

described in section 103 (the `Livingston Parish lands'). Upon a finding 

by the Secretary of the Interior based upon the USGS Assessment and 

Report that it is unlikely that economically recoverable oil and gas 

resources are present, the Secretary shall convey all rights to oil and 

gas underlying such lands to the recipients, or their successors, heirs, 

or assigns, of the conveyances under subsection (b). Such further 

conveyances shall be made within 180 days after a finding by the 

Secretary that it is unlikely that economically recoverable oil and gas 

resources are present.''.

 Subtitle G--Miscellaneous

SEC. 381. DEADLINE FOR DECISION ON APPEALS OF CONSISTENCY DETERMINATION 

 UNDER THE COASTAL ZONE MANAGEMENT ACT OF 1972.

 Section 319 of the Coastal Zone Management Act of 1972 (16 U.S.C. 

1465) is amended to read as follows:

 ``appeals to the secretary

 ``Sec. 319. (a) Notice.--Not <<NOTE: Federal 

Register, publication.>> later than 30 days after the date of the filing 

of an appeal to the Secretary of a consistency determination under 

section 307, the Secretary shall publish an initial notice in the 

Federal Register.

 ``(b) Closure of Record.--

 ``(1) In general.--Not later than the end of the 160-day 

 period beginning on the date of publication of an initial notice 

 under subsection (a), except as provided in paragraph (3), the 

 Secretary shall immediately close the decision record and 

 receive no more filings on the appeal.

 ``(2) Notice.--After <<NOTE: Federal 

 Register, publication.>> closing the administrative record, the 

 Secretary shall immediately publish a notice in the Federal 

 Register that the administrative record has been closed.

 ``(3) Exception.--

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 ``(A) In general.--Subject to subparagraph (B), 

 during the 160-day period described in paragraph (1), 

 the Secretary may stay the closing of the decision 

 record--

 ``(i) for a specific period mutually agreed to 

 in writing by the appellant and the State agency; 

 or

 ``(ii) as the Secretary determines necessary 

 to receive, on an expedited basis--

[[Page 119 STAT. 738]]

 ``(I) any supplemental information 

 specifically requested by the Secretary 

 to complete a consistency review under 

 this Act; or

 ``(II) any clarifying information 

 submitted by a party to the proceeding 

 related to information in the 

 consolidated record compiled by the lead 

 Federal permitting agency.

 ``(B) Applicability.--The Secretary may only stay 

 the 160-day period described in paragraph (1) for a 

 period not to exceed 60 days.

 ``(c) Deadline for Decision.--

 ``(1) In general.--Not <<NOTE: Notices. Federal 

 Register, publication.>> later than 60 days after the date of 

 publication of a Federal Register notice stating when the 

 decision record for an appeal has been closed, the Secretary 

 shall issue a decision or publish a notice in the Federal 

 Register explaining why a decision cannot be issued at that 

 time.

 ``(2) Subsequent decision.--Not later than 15 days after the 

 date of publication of a Federal Register notice explaining why 

 a decision cannot be issued within the 60-day period, the 

 Secretary shall issue a decision.''.

SEC. 382. <<NOTE: 16 USC 1466.>> APPEALS RELATING TO OFFSHORE MINERAL 

 DEVELOPMENT.

 For any Federal administrative agency proceeding that is an appeal 

or review under section 319 of the Coastal Zone Management Act of 1972 

(16 U.S.C. 1465), as amended by this Act, related to any Federal 

authorization for the permitting, approval, or other authorization of an 

energy project, the lead Federal permitting agency for the project 

shall, with the cooperation of Federal and State administrative 

agencies, maintain a consolidated record of all decisions made or 

actions taken by the lead agency or by another Federal or State 

administrative agency or officer. Such record shall be the initial 

record for appeals or reviews under that Act, provided that the record 

may be supplemented as expressly provided pursuant to section 319 of 

that Act.

SEC. 383. ROYALTY PAYMENTS UNDER LEASES UNDER THE OUTER CONTINENTAL 

 SHELF LANDS ACT.

 (a) Royalty Relief.--

 (1) In general.--For purposes of providing compensation for 

 lessees and a State for which amounts are authorized by section 

 6004(c) of the Oil Pollution Act of 1990 (Public Law 101-380), a 

 lessee may withhold from payment any royalty due and owing to 

 the United States under any leases under the Outer Continental 

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 Shelf Lands Act (43 U.S.C. 1301 et seq.) for offshore oil or gas 

 production from a covered lease tract if, on or before the date 

 that the payment is due and payable to the United States, the 

 lessee makes a payment to the State of 44 cents for every $1 of 

 royalty withheld.

 (2) Treatment of amounts.--Any royalty withheld by a lessee 

 in accordance with this section (including any portion thereof 

 that is paid to the State under paragraph (1)) shall be treated 

 as paid for purposes of satisfaction of the royalty obligations 

 of the lessee to the United States.

 (3) Certification of withheld amounts.--The Secretary of the 

 Treasury shall--

 (A) determine the amount of royalty withheld by a 

 lessee under this section; and

[[Page 119 STAT. 739]]

 (B) <<NOTE: Publication.>> promptly publish a 

 certification when the total amount of royalty withheld 

 by the lessee under this section is equal to--

 (i) the dollar amount stated at page 47 of 

 Senate Report number 101-534, which is designated 

 therein as the total drainage claim for the West 

 Delta field; plus

 (ii) interest as described at page 47 of that 

 Report.

 (b) Period of Royalty Relief.--Subsection 

(a) <<NOTE: Applicability. Effective date. Termination date.>> shall 

apply to royalty amounts that are due and payable in the period 

beginning on October 1, 2006, and ending on the date on which the 

Secretary of the Treasury publishes a certification under subsection 

(a)(3)(B).

 (c) Definitions.--As used in this section:

 (1) Covered lease tract.--The term ``covered lease tract'' 

 means a leased tract (or portion of a leased tract)--

 (A) lying seaward of the zone defined and governed 

 by section 8(g) of the Outer Continental Shelf Lands Act 

 (43 U.S.C. 1337(g)); or

 (B) lying within such zone but to which such section 

 does not apply.

 (2) Lessee.--The term ``lessee''--

 (A) means a person or entity that, on the date of 

 the enactment of the Oil Pollution Act of 1990, was a 

 lessee referred to in section 6004(c) of that Act (as in 

 effect on that date of the enactment), but did not hold 

 lease rights in Federal offshore lease OCS-G-5669; and

 (B) includes successors and affiliates of a person 

 or entity described in subparagraph (A).

SEC. 384. COASTAL IMPACT ASSISTANCE PROGRAM.

 Section 31 of the Outer Continental Shelf Lands Act (43 U.S.C. 

1356a) is amended to read as follows:

``SEC. 31. COASTAL IMPACT ASSISTANCE PROGRAM.

 ``(a) Definitions.--In this section:

 ``(1) Coastal political subdivision.--The term `coastal 

 political subdivision' means a political subdivision of a 

 coastal State any part of which political subdivision is--

 ``(A) within the coastal zone (as defined in section 

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 304 of the Coastal Zone Management Act of 1972 (16 

 U.S.C. 1453)) of the coastal State as of the date of 

 enactment of the Energy Policy Act of 2005; and

 ``(B) not more than 200 nautical miles from the 

 geographic center of any leased tract.

 ``(2) Coastal population.--The term `coastal population' 

 means the population, as determined by the most recent official 

 data of the Census Bureau, of each political subdivision any 

 part of which lies within the designated coastal boundary of a 

 State (as defined in a State's coastal zone management program 

 under the Coastal Zone Management Act of 1972 (16 U.S.C. 1451 et 

 seq.)).

 ``(3) Coastal state.--The term `coastal State' has the 

 meaning given the term in section 304 of the Coastal Zone 

 Management Act of 1972 (16 U.S.C. 1453).

 ``(4) Coastline.--The term `coastline' has the meaning given 

 the term `coast line' in section 2 of the Submerged Lands Act 

 (43 U.S.C. 1301).

[[Page 119 STAT. 740]]

 ``(5) Distance.--The term `distance' means the minimum great 

 circle distance, measured in statute miles.

 ``(6) Leased tract.--The term `leased tract' means a tract 

 that is subject to a lease under section 6 or 8 for the purpose 

 of drilling for, developing, and producing oil or natural gas 

 resources.

 ``(7) Leasing moratoria.--The term `leasing moratoria' means 

 the prohibitions on preleasing, leasing, and related activities 

 on any geographic area of the outer Continental Shelf as 

 contained in sections 107 through 109 of division E of the 

 Consolidated Appropriations Act, 2005 (Public Law 108-447; 118 

 Stat. 3063).

 ``(8) Political subdivision.--The term `political 

 subdivision' means the local political jurisdiction immediately 

 below the level of State government, including counties, 

 parishes, and boroughs.

 ``(9) Producing state.--

 ``(A) In general.--The term `producing State' means 

 a coastal State that has a coastal seaward boundary 

 within 200 nautical miles of the geographic center of a 

 leased tract within any area of the outer Continental 

 Shelf.

 ``(B) Exclusion.--The term `producing State' does 

 not include a producing State, a majority of the 

 coastline of which is subject to leasing moratoria, 

 unless production was occurring on January 1, 2005, from 

 a lease within 10 nautical miles of the coastline of 

 that State.

 ``(10) Qualified outer continental shelf revenues.--

 ``(A) In general.--The term `qualified Outer 

 Continental Shelf revenues' means all amounts received 

 by the United States from each leased tract or portion 

 of a leased tract--

 ``(i) lying--

 ``(I) seaward of the zone covered by 

 section 8(g); or

 ``(II) within that zone, but to 

 which section 8(g) does not apply; and

 ``(ii) the geographic center of which lies 

 within a distance of 200 nautical miles from any 

 part of the coastline of any coastal State.

 ``(B) Inclusions.--The term `qualified Outer 

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 Continental Shelf revenues' includes bonus bids, rents, 

 royalties (including payments for royalty taken in kind 

 and sold), net profit share payments, and related late-

 payment interest from natural gas and oil leases issued 

 under this Act.

 ``(C) Exclusion.--The term `qualified Outer 

 Continental Shelf revenues' does not include any 

 revenues from a leased tract or portion of a leased 

 tract that is located in a geographic area subject to a 

 leasing moratorium on January 1, 2005, unless the lease 

 was in production on January 1, 2005.

 ``(b) Payments to Producing States and Coastal Political 

Subdivisions.--

 ``(1) In general.--The Secretary shall, without further 

 appropriation, disburse to producing States and coastal 

 political subdivisions in accordance with this section 

 $250,000,000 for each of fiscal years 2007 through 2010.

[[Page 119 STAT. 741]]

 ``(2) Disbursement.--In each fiscal year, the Secretary 

 shall disburse to each producing State for which the Secretary 

 has approved a plan under subsection (c), and to coastal 

 political subdivisions under paragraph (4), such funds as are 

 allocated to the producing State or coastal political 

 subdivision, respectively, under this section for the fiscal 

 year.

 ``(3) Allocation among producing states.--

 ``(A) In general.--Except as provided in 

 subparagraph (C) and subject to subparagraph (D), the 

 amounts available under paragraph (1) shall be allocated 

 to each producing State based on the ratio that--

 ``(i) the amount of qualified outer 

 Continental Shelf revenues generated off the 

 coastline of the producing State; bears to

 ``(ii) the amount of qualified outer 

 Continental Shelf revenues generated off the 

 coastline of all producing States.

 ``(B) Amount of outer continental shelf revenues.--

 For purposes of subparagraph (A)--

 ``(i) the amount of qualified outer 

 Continental Shelf revenues for each of fiscal 

 years 2007 and 2008 shall be determined using 

 qualified outer Continental Shelf revenues 

 received for fiscal year 2006; and

 ``(ii) the amount of qualified outer 

 Continental Shelf revenues for each of fiscal 

 years 2009 and 2010 shall be determined using 

 qualified outer Continental Shelf revenues 

 received for fiscal year 2008.

 ``(C) Multiple producing states.--In a case in which 

 more than one producing State is located within 200 

 nautical miles of any portion of a leased tract, the 

 amount allocated to each producing State for the leased 

 tract shall be inversely proportional to the distance 

 between--

 ``(i) the nearest point on the coastline of 

 the producing State; and

 ``(ii) the geographic center of the leased 

 tract.

 ``(D) Minimum allocation.--The amount allocated to a 

 producing State under subparagraph (A) shall be at least 

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 1 percent of the amounts available under paragraph (1).

 ``(4) Payments to coastal political subdivisions.--

 ``(A) In general.--The Secretary shall pay 35 

 percent of the allocable share of each producing State, 

 as determined under paragraph (3) to the coastal 

 political subdivisions in the producing State.

 ``(B) Formula.--Of the amount paid by the Secretary 

 to coastal political subdivisions under subparagraph 

 (A)--

 ``(i) 25 percent shall be allocated to each 

 coastal political subdivision in the proportion 

 that--

 ``(I) the coastal population of the 

 coastal political subdivision; bears to

 ``(II) the coastal population of all 

 coastal political subdivisions in the 

 producing State;

 ``(ii) 25 percent shall be allocated to each 

 coastal political subdivision in the proportion 

 that--

 ``(I) the number of miles of 

 coastline of the coastal political 

 subdivision; bears to

[[Page 119 STAT. 742]]

 ``(II) the number of miles of 

 coastline of all coastal political 

 subdivisions in the producing State; and

 ``(iii) 50 percent shall be allocated in 

 amounts that are inversely proportional to the 

 respective distances between the points in each 

 coastal political subdivision that are closest to 

 the geographic center of each leased tract, as 

 determined by the Secretary.

 ``(C) Exception for the state of louisiana.--For the 

 purposes of subparagraph (B)(ii), the coastline for 

 coastal political subdivisions in the State of Louisiana 

 without a coastline shall be considered to be \1/3\ the 

 average length of the coastline of all coastal political 

 subdivisions with a coastline in the State of Louisiana.

 ``(D) Exception for the state of alaska.--For the 

 purposes of carrying out subparagraph (B)(iii) in the 

 State of Alaska, the amounts allocated shall be divided 

 equally among the two coastal political subdivisions 

 that are closest to the geographic center of a leased 

 tract.

 ``(E) Exclusion of certain leased tracts.--For 

 purposes of subparagraph (B)(iii), a leased tract or 

 portion of a leased tract shall be excluded if the tract 

 or portion of a leased tract is located in a geographic 

 area subject to a leasing moratorium on January 1, 2005, 

 unless the lease was in production on that date.

 ``(5) No approved plan.--

 ``(A) In general.--Subject to subparagraph (B) and 

 except as provided in subparagraph (C), in a case in 

 which any amount allocated to a producing State or 

 coastal political subdivision under paragraph (4) or (5) 

 is not disbursed because the producing State does not 

 have in effect a plan that has been approved by the 

 Secretary under subsection (c), the Secretary shall 

 allocate the undisbursed amount equally among all other 

 producing States.

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 ``(B) Retention of allocation.--The Secretary shall 

 hold in escrow an undisbursed amount described in 

 subparagraph (A) until such date as the final appeal 

 regarding the disapproval of a plan submitted under 

 subsection (c) is decided.

 ``(C) Waiver.--The Secretary may waive subparagraph 

 (A) with respect to an allocated share of a producing 

 State and hold the allocable share in escrow if the 

 Secretary determines that the producing State is making 

 a good faith effort to develop and submit, or update, a 

 plan in accordance with subsection (c).

 ``(c) Coastal Impact Assistance Plan.--

 ``(1) Submission of state plans.--

 ``(A) In general.--Not <<NOTE: Deadline.>> later 

 than July 1, 2008, the Governor of a producing State 

 shall submit to the Secretary a coastal impact 

 assistance plan.

 ``(B) Public participation.--In carrying out 

 subparagraph (A), the Governor shall solicit local input 

 and provide for public participation in the development 

 of the plan.

 ``(2) Approval.--

 ``(A) In general.--The Secretary shall approve a 

 plan of a producing State submitted under paragraph (1) 

 before disbursing any amount to the producing State, or 

 to a

[[Page 119 STAT. 743]]

 coastal political subdivision located in the producing 

 State, under this section.

 ``(B) Components.--The Secretary shall approve a 

 plan submitted under paragraph (1) if--

 ``(i) the Secretary determines that the plan 

 is consistent with the uses described in 

 subsection (d); and

 ``(ii) the plan contains--

 ``(I) the name of the State agency 

 that will have the authority to 

 represent and act on behalf of the 

 producing State in dealing with the 

 Secretary for purposes of this section;

 ``(II) a program for the 

 implementation of the plan that 

 describes how the amounts provided under 

 this section to the producing State will 

 be used;

 ``(III) for each coastal political 

 subdivision that receives an amount 

 under this section--

 ``(aa) the name of a contact 

 person; and

 ``(bb) a description of how 

 the coastal political 

 subdivision will use amounts 

 provided under this section;

 ``(IV) <<NOTE: Certification.>> a 

 certification by the Governor that ample 

 opportunity has been provided for public 

 participation in the development and 

 revision of the plan; and

 ``(V) a description of measures that 

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 will be taken to determine the 

 availability of assistance from other 

 relevant Federal resources and programs.

 ``(3) Amendment.--Any amendment to a plan submitted under 

 paragraph (1) shall be--

 ``(A) developed in accordance with this subsection; 

 and

 ``(B) submitted to the Secretary for approval or 

 disapproval under paragraph (4).

 ``(4) Procedure.--Not <<NOTE: Deadline.>> later than 90 days 

 after the date on which a plan or amendment to a plan is 

 submitted under paragraph (1) or (3), the Secretary shall 

 approve or disapprove the plan or amendment.

 ``(d) Authorized Uses.--

 ``(1) In general.--A producing State or coastal political 

 subdivision shall use all amounts received under this section, 

 including any amount deposited in a trust fund that is 

 administered by the State or coastal political subdivision and 

 dedicated to uses consistent with this section, in accordance 

 with all applicable Federal and State laws, only for one or more 

 of the following purposes:

 ``(A) Projects and activities for the conservation, 

 protection, or restoration of coastal areas, including 

 wetland.

 ``(B) Mitigation of damage to fish, wildlife, or 

 natural resources.

 ``(C) Planning assistance and the administrative 

 costs of complying with this section.

 ``(D) Implementation of a federally-approved marine, 

 coastal, or comprehensive conservation management plan.

 ``(E) Mitigation of the impact of outer Continental 

 Shelf activities through funding of onshore 

 infrastructure projects and public service needs.

[[Page 119 STAT. 744]]

 ``(2) Compliance with authorized uses.--If the Secretary 

 determines that any expenditure made by a producing State or 

 coastal political subdivision is not consistent with this 

 subsection, the Secretary shall not disburse any additional 

 amount under this section to the producing State or the coastal 

 political subdivision until such time as all amounts obligated 

 for unauthorized uses have been repaid or reobligated for 

 authorized uses.

 ``(3) Limitation.--Not more than 23 percent of amounts 

 received by a producing State or coastal political subdivision 

 for any 1 fiscal year shall be used for the purposes described 

 in subparagraphs (C) and (E) of paragraph (1).''.

SEC. 385. STUDY OF AVAILABILITY OF SKILLED WORKERS.

 (a) In General.--The <<NOTE: Contracts.>> Secretary shall enter into 

an arrangement with the National Academy of Sciences under which the 

National Academy of Sciences shall conduct a study of the short-term and 

long-term availability of skilled workers to meet the energy and mineral 

security requirements of the United States.

 (b) Inclusions.--The study shall include an analysis of--

 (1) the need for and availability of workers for the oil, 

 gas, and mineral industries;

 (2) the availability of skilled labor at both entry level 

 and more senior levels; and

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 (3) recommendations for future actions needed to meet future 

 labor requirements.

 (c) Report.--Not later than 2 years after the date of enactment of 

this Act, the Secretary shall submit to Congress a report that describes 

the results of the study.

SEC. 386. <<NOTE: 42 USC 15941.>> GREAT LAKES OIL AND GAS DRILLING BAN.

 No Federal or State permit or lease shall be issued for new oil and 

gas slant, directional, or offshore drilling in or under one or more of 

the Great Lakes.

SEC. 387. <<NOTE: Deadline. 42 USC 13368 note.>> FEDERAL COALBED METHANE 

 REGULATION.

 Any State currently on the list of Affected States established under 

section 1339(b) of the Energy Policy Act of 1992 (42 U.S.C. 13368(b)) 

shall be removed from the list if, not later than 3 years after the date 

of enactment of this Act, the State takes, or prior to the date of 

enactment has taken, any of the actions required for removal from the 

list under such section 1339(b).

SEC. 388. ALTERNATE ENERGY-RELATED USES ON THE OUTER CONTINENTAL SHELF.

 (a) Amendment to Outer Continental Shelf Lands Act.--Section 8 of 

the Outer Continental Shelf Lands Act (43 U.S.C. 1337) is amended by 

adding at the end the following:

 ``(p) Leases, Easements, or Rights-of-way for Energy and Related 

Purposes.--

 ``(1) In general.--The Secretary, in consultation with the 

 Secretary of the Department in which the Coast Guard is 

 operating and other relevant departments and agencies of the 

 Federal Government, may grant a lease, easement, or right-of-way 

 on the outer Continental Shelf for activities not otherwise 

 authorized in this Act, the Deepwater Port Act of 1974 (33 

 U.S.C. 1501 et seq.), the Ocean Thermal Energy Conversion

[[Page 119 STAT. 745]]

 Act of 1980 (42 U.S.C. 9101 et seq.), or other applicable law, 

 if those activities--

 ``(A) support exploration, development, production, 

 or storage of oil or natural gas, except that a lease, 

 easement, or right-of-way shall not be granted in an 

 area in which oil and gas preleasing, leasing, and 

 related activities are prohibited by a moratorium;

 ``(B) support transportation of oil or natural gas, 

 excluding shipping activities;

 ``(C) produce or support production, transportation, 

 or transmission of energy from sources other than oil 

 and gas; or

 ``(D) use, for energy-related purposes or for other 

 authorized marine-related purposes, facilities currently 

 or previously used for activities authorized under this 

 Act, except that any oil and gas energy-related uses 

 shall not be authorized in areas in which oil and gas 

 preleasing, leasing, and related activities are 

 prohibited by a moratorium.

 ``(2) Payments and revenues.--(A) The Secretary shall 

 establish royalties, fees, rentals, bonuses, or other payments 

 to ensure a fair return to the United States for any lease, 

 easement, or right-of-way granted under this subsection.

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 ``(B) The Secretary shall provide for the payment of 27 

 percent of the revenues received by the Federal Government as a 

 result of payments under this section from projects that are 

 located wholly or partially within the area extending three 

 nautical miles seaward of State submerged 

 lands. <<NOTE: Regulations. Deadline.>> Payments shall be made 

 based on a formula established by the Secretary by rulemaking no 

 later than 180 days after the date of enactment of this section 

 that provides for equitable distribution, based on proximity to 

 the project, among coastal states that have a coastline that is 

 located within 15 miles of the geographic center of the project.

 ``(3) Competitive or noncompetitive basis.--Except with 

 respect to projects that meet the criteria established under 

 section 388(d) of the Energy Policy Act of 2005, the Secretary 

 shall issue a lease, easement, or right-of-way under paragraph 

 (1) on a competitive basis unless the Secretary determines after 

 public notice of a proposed lease, easement, or right-of-way 

 that there is no competitive interest.

 ``(4) Requirements.--The Secretary shall ensure that any 

 activity under this subsection is carried out in a manner that 

 provides for--

 ``(A) safety;

 ``(B) protection of the environment;

 ``(C) prevention of waste;

 ``(D) conservation of the natural resources of the 

 outer Continental Shelf;

 ``(E) coordination with relevant Federal agencies;

 ``(F) protection of national security interests of 

 the United States;

 ``(G) protection of correlative rights in the outer 

 Continental Shelf;

 ``(H) a fair return to the United States for any 

 lease, easement, or right-of-way under this subsection;

[[Page 119 STAT. 746]]

 ``(I) prevention of interference with reasonable 

 uses (as determined by the Secretary) of the exclusive 

 economic zone, the high seas, and the territorial seas;

 ``(J) consideration of--

 ``(i) the location of, and any schedule 

 relating to, a lease, easement, or right-of-way 

 for an area of the outer Continental Shelf; and

 ``(ii) any other use of the sea or seabed, 

 including use for a fishery, a sealane, a 

 potential site of a deepwater port, or navigation;

 ``(K) public notice and comment on any proposal 

 submitted for a lease, easement, or right-of-way under 

 this subsection; and

 ``(L) oversight, inspection, research, monitoring, 

 and enforcement relating to a lease, easement, or right-

 of-way under this subsection.

 ``(5) Lease duration, suspension, and cancellation.--The 

 Secretary shall provide for the duration, issuance, transfer, 

 renewal, suspension, and cancellation of a lease, easement, or 

 right-of-way under this subsection.

 ``(6) Security.--The Secretary shall require the holder of a 

 lease, easement, or right-of-way granted under this subsection 

 to--

 ``(A) furnish a surety bond or other form of 

 security, as prescribed by the Secretary;

 ``(B) comply with such other requirements as the 

 Secretary considers necessary to protect the interests 

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 of the public and the United States; and

 ``(C) provide for the restoration of the lease, 

 easement, or right-of-way.

 ``(7) Coordination and consultation with affected state and 

 local governments.--The Secretary shall provide for coordination 

 and consultation with the Governor of any State or the executive 

 of any local government that may be affected by a lease, 

 easement, or right-of-way under this subsection.

 ``(8) Regulations.--Not <<NOTE: Deadline.>> later than 270 

 days after the date of enactment of the Energy Policy Act of 

 2005, the Secretary, in consultation with the Secretary of 

 Defense, the Secretary of the Department in which the Coast 

 Guard is operating, the Secretary of Commerce, heads of other 

 relevant departments and agencies of the Federal Government, and 

 the Governor of any affected State, shall issue any necessary 

 regulations to carry out this subsection.

 ``(9) Effect of subsection.--Nothing in this subsection 

 displaces, supersedes, limits, or modifies the jurisdiction, 

 responsibility, or authority of any Federal or State agency 

 under any other Federal law.

 ``(10) Applicability.--This subsection does not apply to any 

 area on the outer Continental Shelf within the exterior 

 boundaries of any unit of the National Park System, National 

 Wildlife Refuge System, or National Marine Sanctuary System, or 

 any National Monument.''.

 (b) Coordinated <<NOTE: 43 USC 1337 note.>> OCS Mapping 

Initiative.--

 (1) In general.--The Secretary of the Interior, in 

 cooperation with the Secretary of Commerce, the Commandant of 

 the Coast Guard, and the Secretary of Defense, shall establish

[[Page 119 STAT. 747]]

 an interagency comprehensive digital mapping initiative for the 

 outer Continental Shelf to assist in decisionmaking relating to 

 the siting of activities under subsection (p) of section 8 of 

 the Outer Continental Shelf Lands Act (43 U.S.C. 1337) (as added 

 by subsection (a)).

 (2) Use of data.--The mapping initiative shall use, and 

 develop procedures for accessing, data collected before the date 

 on which the mapping initiative is established, to the maximum 

 extent practicable.

 (3) Inclusions.--Mapping carried out under the mapping 

 initiative shall include an indication of the locations on the 

 outer Continental Shelf of--

 (A) Federally-permitted activities;

 (B) obstructions to navigation;

 (C) submerged cultural resources;

 (D) undersea cables;

 (E) offshore aquaculture projects; and

 (F) any area designated for the purpose of safety, 

 national security, environmental protection, or 

 conservation and management of living marine resources.

 (c) Conforming Amendment.--Section 8 of the Outer Continental Shelf 

Lands Act (43 U.S.C. 1337) is amended by striking the section heading 

and inserting the following: ``Leases, Easements, and Rights-of-way on 

the Outer Continental 

Shelf.--''.

 (d) Savings Provision.--Nothing <<NOTE: 43 USC 1337 note.>> in the 

amendment made by subsection (a) requires the resubmittal of any 

document that was previously submitted or the reauthorization of any 

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action that was previously authorized with respect to a project for 

which, before the date of enactment of this Act--

 (1) an offshore test facility has been constructed; or

 (2) a request for a proposal has been issued by a public 

 authority.

 (e) State <<NOTE: 43 USC 1337 note.>> Claims to Jurisdiction Over 

Submerged Lands.--Nothing in this section shall be construed to alter, 

limit, or modify any claim of any State to any jurisdiction over, or any 

right, title, or interest in, any submerged lands.

SEC. 389. OIL SPILL RECOVERY INSTITUTE.

 Title V of the Oil Pollution Act of 1990 (33 U.S.C. 2731 et seq.) is 

amended--

 (1) <<NOTE: 33 USC 2731.>> in section 5001(i), by striking 

 ``September 30, 2012'' and inserting ``1 year after the date on 

 which the Secretary, in consultation with the Secretary of the 

 Interior, determines that oil and gas exploration, development, 

 and production in the State of Alaska have ceased''; and

 (2) <<NOTE: 33 USC 2736.>> in section 5006(c), by striking 

 ``October 1, 2012'' and inserting ``1 year after the date on 

 which the Secretary, in consultation with the Secretary of the 

 Interior, determines that oil and gas exploration, development, 

 and production in the State of Alaska have ceased,''.

SEC. 390. <<NOTE: 42 USC 15942.>> NEPA REVIEW.

 (a) NEPA Review.--Action by the Secretary of the Interior in 

managing the public lands, or the Secretary of Agriculture in managing 

National Forest System Lands, with respect to any of the activities 

described in subsection (b) shall be subject to a rebuttable presumption 

that the use of a categorical exclusion under

[[Page 119 STAT. 748]]

the National Environmental Policy Act of 1969 (NEPA) would apply if the 

activity is conducted pursuant to the Mineral Leasing Act for the 

purpose of exploration or development of oil or gas.

 (b) Activities Described.--The activities referred to in subsection 

(a) are the following:

 (1) Individual surface disturbances of less than 5 acres so 

 long as the total surface disturbance on the lease is not 

 greater than 150 acres and site-specific analysis in a document 

 prepared pursuant to NEPA has been previously completed.

 (2) Drilling an oil or gas well at a location or well pad 

 site at which drilling has occurred previously within 5 years 

 prior to the date of spudding the well.

 (3) Drilling an oil or gas well within a developed field for 

 which an approved land use plan or any environmental document 

 prepared pursuant to NEPA analyzed such drilling as a reasonably 

 foreseeable activity, so long as such plan or document was 

 approved within 5 years prior to the date of spudding the well.

 (4) Placement of a pipeline in an approved right-of-way 

 corridor, so long as the corridor was approved within 5 years 

 prior to the date of placement of the pipeline.

 (5) Maintenance of a minor activity, other than any 

 construction or major renovation or a building or facility.

 Subtitle H--Refinery Revitalization

SEC. 391. <<NOTE: 42 USC 15951.>> FINDINGS AND DEFINITIONS.

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 (a) Findings.--Congress finds that--

 (1) it serves the national interest to increase petroleum 

 refining capacity for gasoline, heating oil, diesel fuel, jet 

 fuel, kerosene, and petrochemical feedstocks wherever located 

 within the United States, to bring more supply to the markets 

 for the use of the American people;

 (2) United States demand for refined petroleum products 

 currently exceeds the country's petroleum refining capacity to 

 produce such products;

 (3) this excess demand has been met with increased imports;

 (4) due to lack of capacity, refined petroleum product 

 imports are expected to grow from 7.9 percent to 10.7 percent of 

 total refined product by 2025;

 (5) refiners are still subject to significant environmental 

 and other regulations and face several new requirements under 

 the Clean Air Act (42 U.S.C. 7401 et seq.) over the next decade; 

 and

 (6) better coordination of Federal and State regulatory 

 reviews may help facilitate siting and construction of new 

 refineries to meet the demand in the United States for refined 

 products.

 (b) Definitions.--In this subtitle:

 (1) Administrator.--The term ``Administrator'' means the 

 Administrator of the Environmental Protection Agency.

 (2) State.--The term ``State'' means--

 (A) a State;

 (B) the Commonwealth of Puerto Rico; and

[[Page 119 STAT. 749]]

 (C) any other territory or possession of the United 

 States.

SEC. 392. <<NOTE: 42 USC 15952.>> FEDERAL-STATE REGULATORY COORDINATION 

 AND ASSISTANCE.

 (a) In General.--At the request of the Governor of a State, the 

Administrator may enter into a refinery permitting cooperative agreement 

with the State, under which each party to the agreement identifies 

steps, including timelines, that it will take to streamline the 

consideration of Federal and State environmental permits for a new 

refinery.

 (b) Authority Under Agreement.--The Administrator shall be 

authorized to--

 (1) accept from a refiner a consolidated application for all 

 permits required from the Environmental Protection Agency, to 

 the extent consistent with other applicable law;

 (2) enter into memoranda of agreement with other Federal 

 agencies to coordinate consideration of refinery applications 

 and permits among Federal agencies; and

 (3) enter into memoranda of agreement with a State, under 

 which Federal and State review of refinery permit applications 

 will be coordinated and concurrently considered, to the extent 

 practicable.

 (c) State Assistance.--The Administrator is authorized to provide 

financial assistance to State governments to facilitate the hiring of 

additional personnel with expertise in fields relevant to consideration 

of refinery permits.

 (d) Other Assistance.--The Administrator is authorized to provide 

technical, legal, or other assistance to State governments to facilitate 

their review of applications to build new refineries.

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 TITLE IV--COAL

 Subtitle A--Clean Coal Power Initiative

SEC. 401. <<NOTE: 42 USC 15961.>> AUTHORIZATION OF APPROPRIATIONS.

 (a) Clean Coal Power Initiative.--There are authorized to be 

appropriated to the Secretary to carry out the activities authorized by 

this subtitle $200,000,000 for each of fiscal years 2006 through 2014, 

to remain available until expended.

 (b) Report.--The Secretary shall submit to Congress the report 

required by this subsection not later than March 31, 2007. The report 

shall include, with respect to subsection (a), a plan containing--

 (1) a detailed assessment of whether the aggregate funding 

 levels provided under subsection (a) are the appropriate funding 

 levels for that program;

 (2) a detailed description of how proposals will be 

 solicited and evaluated, including a list of all activities 

 expected to be undertaken;

 (3) a detailed list of technical milestones for each coal 

 and related technology that will be pursued; and

 (4) a detailed description of how the program will avoid 

 problems enumerated in Government Accountability Office

[[Page 119 STAT. 750]]

 reports on the Clean Coal Technology Program, including problems 

 that have resulted in unspent funds and projects that failed 

 either financially or scientifically.

SEC. 402. <<NOTE: 42 USC 15962.>> PROJECT CRITERIA.

 (a) In General.--To be eligible to receive assistance under this 

subtitle, a project shall advance efficiency, environmental performance, 

and cost competitiveness well beyond the level of technologies that are 

in commercial service or have been demonstrated on a scale that the 

Secretary determines is sufficient to demonstrate that commercial 

service is viable as of the date of enactment of this Act.

 (b) Technical Criteria for Clean Coal Power Initiative.--

 (1) Gasification projects.--

 (A) In general.--In allocating the funds made 

 available under section 401(a), the Secretary shall 

 ensure that at least 70 percent of the funds are used 

 only to fund projects on coal-based gasification 

 technologies, including--

 (i) gasification combined cycle;

 (ii) gasification fuel cells and turbine 

 combined cycle;

 (iii) gasification coproduction;

 (iv) hybrid gasification and combustion; and

 (v) other advanced coal based technologies 

 capable of producing a concentrated stream of 

 carbon dioxide.

 (B) Technical milestones.--

 (i) Periodic determination.--

 (I) In general.--The Secretary shall 

 periodically set technical milestones 

 specifying the emission and thermal 

 efficiency levels that coal gasification 

 projects under this subtitle shall be 

 designed, and reasonably expected, to 

 achieve.

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 (II) Prescriptive milestones.--The 

 technical milestones shall become more 

 prescriptive during the period of the 

 clean coal power initiative.

 (ii) 2020 goals.--The Secretary shall 

 establish the periodic milestones so as to achieve 

 by the year 2020 coal gasification projects able--

 (I) to remove at least 99 percent of 

 sulfur dioxide;

 (II) to emit not more than .05 lbs 

 of NO<INF>x</INF> per million Btu;

 (III) to achieve at least 95 percent 

 reductions in mercury emissions; and

 (IV) to achieve a thermal efficiency 

 of at least--

 (aa) 50 percent for coal of 

 more than 9,000 Btu;

 (bb) 48 percent for coal of 

 7,000 to 9,000 Btu; and

 (cc) 46 percent for coal of 

 less than 7,000 Btu.

 (2) Other projects.--

 (A) Allocation of funds.--The Secretary shall ensure 

 that up to 30 percent of the funds made available under 

 section 401(a) are used to fund projects other than 

 those described in paragraph (1).

[[Page 119 STAT. 751]]

 (B) Technical milestones.--

 (i) Periodic determination.--

 (I) In general.--The Secretary shall 

 periodically establish technical 

 milestones specifying the emission and 

 thermal efficiency levels that projects 

 funded under this paragraph shall be 

 designed, and reasonably expected, to 

 achieve.

 (II) Prescriptive milestones.--The 

 technical milestones shall become more 

 prescriptive during the period of the 

 clean coal power initiative.

 (ii) 2020 goals.--The Secretary shall set the 

 periodic milestones so as to achieve by the year 

 2020 projects able--

 (I) to remove at least 97 percent of 

 sulfur dioxide;

 (II) to emit no more than .08 lbs of 

 NO<INF>x</INF> per million Btu;

 (III) to achieve at least 90 percent 

 reductions in mercury emissions; and

 (IV) to achieve a thermal efficiency 

 of at least--

 (aa) 43 percent for coal of 

 more than 9,000 Btu;

 (bb) 41 percent for coal of 

 7,000 to 9,000 Btu; and

 (cc) 39 percent for coal of 

 less than 7,000 Btu.

 (3) Consultation.--Before setting the technical milestones 

 under paragraphs (1)(B) and (2)(B), the Secretary shall consult 

 with--

 (A) the Administrator of the Environmental 

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 Protection Agency; and

 (B) interested entities, including--

 (i) coal producers;

 (ii) industries using coal;

 (iii) organizations that promote coal or 

 advanced coal technologies;

 (iv) environmental organizations;

 (v) organizations representing workers; and

 (vi) organizations representing consumers.

 (4) Existing units.--In the case of projects at units in 

 existence on the date of enactment of this Act, in lieu of the 

 thermal efficiency requirements described in paragraphs 

 (1)(B)(ii)(IV) and (2)(B)(ii)(IV), the milestones shall be 

 designed to achieve an overall thermal design efficiency 

 improvement, compared to the efficiency of the unit as operated, 

 of not less than--

 (A) 7 percent for coal of more than 9,000 Btu;

 (B) 6 percent for coal of 7,000 to 9,000 Btu; or

 (C) 4 percent for coal of less than 7,000 Btu.

 (5) Administration.--

 (A) Elevation of site.--In evaluating project 

 proposals to achieve thermal efficiency levels 

 established under paragraphs (1)(B)(i) and (2)(B)(i) and 

 in determining progress towards thermal efficiency 

 milestones under paragraphs (1)(B)(ii)(IV), 

 (2)(B)(ii)(IV), and (4), the Secretary

[[Page 119 STAT. 752]]

 shall take into account and make adjustments for the 

 elevation of the site at which a project is proposed to 

 be constructed.

 (B) Applicability of milestones.--In applying the 

 thermal efficiency milestones under paragraphs 

 (1)(B)(ii)(IV), (2)(B)(ii)(IV), and (4) to projects that 

 separate and capture at least 50 percent of the 

 potential emissions of carbon dioxide by a facility, the 

 energy used for separation and capture of carbon dioxide 

 shall not be counted in calculating the thermal 

 efficiency.

 (C) Permitted uses.--In carrying out this section, 

 the Secretary may give priority to projects that 

 include, as part of the project--

 (i) the separation or capture of carbon 

 dioxide; or

 (ii) the reduction of the demand for natural 

 gas if deployed.

 (c) Financial Criteria.--The Secretary shall not provide financial 

assistance under this subtitle for a project unless the recipient 

documents to the satisfaction of the Secretary that--

 (1) the recipient is financially responsible;

 (2) the recipient will provide sufficient information to the 

 Secretary to enable the Secretary to ensure that the funds are 

 spent efficiently and effectively; and

 (3) a market exists for the technology being demonstrated or 

 applied, as evidenced by statements of interest in writing from 

 potential purchasers of the technology.

 (d) Financial Assistance.--The Secretary shall provide financial 

assistance to projects that, as determined by the Secretary--

 (1) meet the requirements of subsections (a), (b), and (c); 

 and

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 (2) are likely--

 (A) to achieve overall cost reductions in the use of 

 coal to generate useful forms of energy or chemical 

 feedstocks;

 (B) to improve the competitiveness of coal among 

 various forms of energy in order to maintain a diversity 

 of fuel choices in the United States to meet electricity 

 generation requirements; and

 (C) to demonstrate methods and equipment that are 

 applicable to 25 percent of the electricity generating 

 facilities, using various types of coal, that use coal

 as the primary feedstock as of the date of enactment of 

 this Act.

 (e) Cost-Sharing.--In carrying out this subtitle, the Secretary 

shall require cost sharing in accordance with section 988.

 (f) Scheduled Completion of Selected Projects.--

 (1) In general.--In selecting a project for financial 

 assistance under this section, the Secretary shall establish a 

 reasonable period of time during which the owner or operator of 

 the project shall complete the construction or demonstration 

 phase of the project, as the Secretary determines to be 

 appropriate.

 (2) Condition of financial assistance.--The Secretary shall 

 require as a condition of receipt of any financial assistance 

 under this subtitle that the recipient of the assistance enter

[[Page 119 STAT. 753]]

 into an agreement with the Secretary not to request an extension 

 of the time period established for the project by the Secretary 

 under paragraph (1).

 (3) Extension of time period.--

 (A) In general.--Subject to subparagraph (B), the 

 Secretary may extend the time period established under 

 paragraph (1) if the Secretary determines, in the sole 

 discretion of the Secretary, that the owner or operator 

 of the project cannot complete the construction or 

 demonstration phase of the project within the time 

 period due to circumstances beyond the control of the 

 owner or operator.

 (B) Limitation.--The Secretary shall not extend a 

 time period under subparagraph (A) by more than 4 years.

 (g) Fee Title.--The Secretary may vest fee title or other property 

interests acquired under cost-share clean coal power initiative 

agreements under this subtitle in any entity, including the United 

States.

 (h) Data Protection.--For a period not exceeding 5 years after 

completion of the operations phase of a cooperative agreement, the 

Secretary may provide appropriate protections (including exemptions from 

subchapter II of chapter 5 of title 5, United States Code) against the 

dissemination of information that--

 (1) results from demonstration activities carried out under 

 the clean coal power initiative program; and

 (2) would be a trade secret or commercial or financial 

 information that is privileged or confidential if the 

 information had been obtained from and first produced by a non-

 Federal party participating in a clean coal power initiative 

 project.

 (i) Applicability.--No technology, or level of emission reduction, 

solely by reason of the use of the technology, or the achievement of the 

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emission reduction, by 1 or more facilities receiving assistance under 

this Act, shall be considered to be--

 (1) adequately demonstrated for purposes of section 111 of 

 the Clean Air Act (42 U.S.C. 7411);

 (2) achievable for purposes of section 169 of that Act (42 

 U.S.C. 7479); or

 (3) achievable in practice for purposes of section 171 of 

 that Act (42 U.S.C. 7501).

SEC. 403. <<NOTE: 42 USC 15963.>> REPORT.

 Not later than 1 year after the date of enactment of this Act, and 

once every 2 years thereafter through 2014, the Secretary, in 

consultation with other appropriate Federal agencies, shall submit to 

Congress a report describing--

 (1) the technical milestones set forth in section 402 and 

 how those milestones ensure progress toward meeting the 

 requirements of subsections (b)(1)(B) and (b)(2) of section 402; 

 and

 (2) the status of projects funded under this subtitle.

SEC. 404. <<NOTE: 42 USC 15964.>> CLEAN COAL CENTERS OF EXCELLENCE.

 (a) In General.--As part of the clean coal power initiative, the 

Secretary shall award competitive, merit-based grants to institutions of 

higher education for the establishment of centers of excellence for 

energy systems of the future.

 (b) Basis for Grants.--The Secretary shall award grants under this 

section to institutions of higher education that show the greatest 

potential for advancing new clean coal technologies.

[[Page 119 STAT. 754]]

 Subtitle B--Clean Power Projects

SEC. 411. <<NOTE: 42 USC 15971.>> INTEGRATED COAL/RENEWABLE ENERGY 

 SYSTEM.

 (a) In General.--Subject to the availability of appropriations, the 

Secretary may provide loan guarantees for a project to produce energy 

from coal of less than 7,000 Btu/lb. using appropriate advanced 

integrated gasification combined cycle technology, including repowering 

of existing facilities, that--

 (1) is combined with wind and other renewable sources;

 (2) minimizes and offers the potential to sequester carbon 

 dioxide emissions; and

 (3) provides a ready source of hydrogen for near-site fuel 

 cell demonstrations.

 (b) Requirements.--The facility--

 (1) may be built in stages;

 (2) shall have a combined output of at least 200 megawatts 

 at successively more competitive rates; and

 (3) shall be located in the Upper Great Plains.

 (c) Technical Criteria.--Technical <<NOTE: Applicability.>> criteria 

described in section 402(b) shall apply to the facility.

 (d) Investment Tax Credits.--

 (1) In general.--The loan guarantees provided under this 

 section do not preclude the facility from receiving an 

 allocation for investment tax credits under section 48A of the 

 Internal Revenue Code of 1986.

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 (2) Other funding.--Use of the investment tax credit 

 described in paragraph (1) does not prohibit the use of other 

 clean coal program funding.

SEC. 412. <<NOTE: 42 USC 15972.>> LOAN TO PLACE ALASKA CLEAN COAL 

 TECHNOLOGY FACILITY IN SERVICE.

 (a) Definitions.--In this section:

 (1) Borrower.--The term ``borrower'' means the owner of the 

 clean coal technology plant.

 (2) Clean coal technology plant.--The term ``clean coal 

 technology plant'' means the plant located near Healy, Alaska, 

 constructed under Department cooperative agreement number DE-FC-

 22-91PC90544.

 (3) Cost of a direct loan.--The term ``cost of a direct 

 loan'' has the meaning given the term in section 502(5)(B) of 

 the Federal Credit Reform Act of 1990 (2 U.S.C. 661a(5)(B)).

 (b) Authorization.--Subject to subsection (c), the Secretary shall 

use amounts made available under subsection (e) to provide the cost of a 

direct loan to the borrower for purposes of placing the clean coal 

technology plant into reliable operation for the generation of 

electricity.

 (c) Requirements.--

 (1) Maximum loan amount.--The amount of the direct loan 

 provided under subsection (b) shall not exceed $80,000,000.

 (2) Determinations by secretary.--Before providing the 

 direct loan to the borrower under subsection (b), the Secretary 

 shall determine that--

 (A) the plan of the borrower for placing the clean 

 coal technology plant in reliable operation has a 

 reasonable prospect of success;

[[Page 119 STAT. 755]]

 (B) the amount of the loan (when combined with 

 amounts available to the borrower from other sources) 

 will be sufficient to carry out the project; and

 (C) there is a reasonable prospect that the borrower 

 will repay the principal and interest on the loan.

 (3) Interest; term.--The direct loan provided under 

 subsection (b) shall bear interest at a rate and for a term that 

 the Secretary determines appropriate, after consultation with 

 the Secretary of the Treasury, taking into account the needs and 

 capacities of the borrower and the prevailing rate of interest 

 for similar loans made by public and private lenders.

 (4) Additional terms and conditions.--The Secretary may 

 require any other terms and conditions that the Secretary 

 determines to be appropriate.

 (d) Use of Payments.--The Secretary shall retain any payments of 

principal and interest on the direct loan provided under subsection (b) 

to support energy research and development activities, to remain 

available until expended, subject to any other conditions in an 

applicable appropriations Act.

 (e) Authorization of Appropriations.--There are authorized to be 

appropriated such sums as are necessary to provide the cost of a direct 

loan under subsection (b).

SEC. 413. <<NOTE: 42 USC 15973.>> WESTERN INTEGRATED COAL GASIFICATION 

 DEMONSTRATION PROJECT.

 (a) In General.--Subject to the availability of appropriations, the 

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Secretary shall carry out a project to demonstrate production of energy 

from coal mined in the western United States using integrated 

gasification combined cycle technology (referred to in this section as 

the ``demonstration project'').

 (b) Components.--The demonstration project--

 (1) may include repowering of existing facilities;

 (2) shall be designed to demonstrate the ability to use coal 

 with an energy content of not more than 9,000 Btu/lb.; and

 (3) shall be capable of removing and sequestering carbon 

 dioxide emissions.

 (c) All Types of Western Coals.--Notwithstanding the foregoing, and 

to the extent economically feasible, the demonstration project shall 

also be designed to demonstrate the ability to use a variety of types of 

coal (including subbituminous and bituminous coal with an energy content 

of up to 13,000 Btu/lb.) mined in the western United States.

 (d) Location.--The demonstration project shall be located in a 

western State at an altitude of greater than 4,000 feet above sea level.

 (e) Cost Sharing.--The Federal share of the cost of the 

demonstration project shall be determined in accordance with section 

988.

 (f) Loan Guarantees.--Notwithstanding title XIV, the demonstration 

project shall not be eligible for Federal loan guarantees.

SEC. 414. <<NOTE: 42 USC 15974.>> COAL GASIFICATION.

 The Secretary is authorized to provide loan guarantees for a project 

to produce energy from a plant using integrated gasification combined 

cycle technology of at least 400 megawatts in capacity that produces 

power at competitive rates in deregulated

[[Page 119 STAT. 756]]

energy generation markets and that does not receive any subsidy (direct 

or indirect) from ratepayers.

SEC. 415. <<NOTE: 42 USC 15975.>> PETROLEUM COKE GASIFICATION.

 The Secretary is authorized to provide loan guarantees for at least 

5 petroleum coke gasification projects.

SEC. 416. <<NOTE: 42 USC 15976.>> ELECTRON SCRUBBING DEMONSTRATION.

 The Secretary shall use $5,000,000 from amounts appropriated to 

initiate, through the Chicago Operations Office, a project to 

demonstrate the viability of high-energy electron scrubbing technology 

on commercial-scale electrical generation using high-sulfur coal.

SEC. 417. <<NOTE: 42 USC 15977.>> DEPARTMENT OF ENERGY TRANSPORTATION 

 FUELS FROM ILLINOIS BASIN COAL.

 (a) In General.--The Secretary shall carry out a program to evaluate 

the commercial and technical viability of advanced technologies for the 

production of Fischer-Tropsch transportation fuels, and other 

transportation fuels, manufactured from Illinois basin coal, including 

the capital modification of existing facilities and the construction of 

testing facilities under subsection (b).

 (b) Facilities.--For the purpose of evaluating the commercial and 

technical viability of different processes for producing Fischer-Tropsch 

transportation fuels, and other transportation fuels, from Illinois 

basin coal, the Secretary shall support the use and capital modification 

of existing facilities and the construction of new facilities at--

 (1) Southern Illinois University Coal Research Center;

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 (2) University of Kentucky Center for Applied Energy 

 Research; and

 (3) Energy Center at Purdue University.

 (c) Gasification Products Test Center.--In conjunction with the 

activities described in subsections (a) and (b), the Secretary shall 

construct a test center to evaluate and confirm liquid and gas products 

from syngas catalysis in order that the system has an output of at least 

500 gallons of Fischer-Tropsch transportation fuel per day in a 24-hour 

operation.

 (d) <<NOTE: Deadlines.>> Milestones.--

 (1) Selection of processes.--Not later than 180 days after 

 the date of enactment of this Act, the Secretary shall select 

 processes for evaluating the commercial and technical viability 

 of different processes of producing Fischer-Tropsch 

 transportation fuels, and other transportation fuels, from 

 Illinois basin coal.

 (2) Agreements.--Not later than 1 year after the date of 

 enactment of this Act, the Secretary shall offer to enter into 

 agreements--

 (A) to carry out the activities described in this 

 section, at the facilities described in subsection (b); 

 and

 (B) for the capital modifications or construction of 

 the facilities at the locations described in subsection 

 (b).

 (3) Evaluations.--Not later than 3 years after the date of 

 enactment of the Act, the Secretary shall begin, at the 

 facilities described in subsection (b), evaluation of the 

 technical and commercial viability of different processes of 

 producing Fischer-Tropsch transportation fuels, and other 

 transportation fuels, from Illinois basin coal.

[[Page 119 STAT. 757]]

 (4) Construction of facilities.--

 (A) In general.--The Secretary shall construct the 

 facilities described in subsection (b) at the lowest 

 cost practicable.

 (B) Grants or agreements.--The Secretary may make 

 grants or enter into agreements or contracts with the 

 institutions of higher education described in subsection 

 (b).

 (e) Cost Sharing.--The cost of making grants under this section 

shall be shared in accordance with section 988.

 (f) Authorization of Appropriations.--There is authorized to be 

appropriated to carry out this section $85,000,000 for the period of 

fiscal years 2006 through 2010.

 Subtitle C--Coal and Related Programs

SEC. 421. AMENDMENT OF THE ENERGY POLICY ACT OF 1992.

 (a) Amendment.--The Energy Policy Act of 1992 (42 U.S.C. 13201 et 

seq.) is amended by adding at the end the following:

 ``TITLE XXXI--CLEAN AIR COAL PROGRAM

``SEC. 3101. <<NOTE: 42 USC 13571.>> PURPOSES.

 ``The purposes of this title are to--

 ``(1) promote national energy policy and energy security, 

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 diversity, and economic competitiveness benefits that result 

 from the increased use of coal;

 ``(2) mitigate financial risks, reduce the cost of clean 

 coal generation, and increase the marketplace acceptance of 

 clean coal generation and pollution control equipment and 

 processes; and

 ``(3) facilitate the environmental performance of clean coal 

 generation.

``SEC. 3102. <<NOTE: 42 USC 13572.>> AUTHORIZATION OF PROGRAM.

 ``(a) In General.--The Secretary shall carry out a program of 

financial assistance to--

 ``(1) facilitate the production and generation of coal-based 

 power, through the deployment of clean coal electric generating 

 equipment and processes that, compared to equipment or processes 

 that are in operation on a full scale--

 ``(A) improve--

 ``(i) energy efficiency; or

 ``(ii) environmental performance consistent 

 with relevant Federal and State clean air 

 requirements, including those promulgated under 

 the Clean Air Act (42 U.S.C. 7401 et seq.); and

 ``(B) are not yet cost competitive; and

 ``(2) facilitate the utilization of existing coal-based 

 electricity generation plants through projects that--

 ``(A) deploy advanced air pollution control 

 equipment and processes; and

 ``(B) are designed to voluntarily enhance 

 environmental performance above current applicable 

 obligations under the

[[Page 119 STAT. 758]]

 Clean Air Act and State implementation efforts pursuant 

 to such Act.

 ``(b) Financial Criteria.--As determined by the Secretary for a 

particular project, financial assistance under this title shall be in 

the form of--

 ``(1) cost-sharing of an appropriate percentage of the total 

 project cost, not to exceed 50 percent as calculated under 

 section 988 of the Energy Policy Act of 2005; or

 ``(2) financial assistance, including grants, cooperative 

 agreements, or loans as authorized under this Act or other 

 statutory authority of the Secretary.

``SEC. 3103. <<NOTE: 42 USC 13573.>> GENERATION PROJECTS.

 ``(a) Eligible Projects.--Projects supported under section 

3102(a)(1) may include--

 ``(1) equipment or processes previously supported by a 

 Department of Energy program;

 ``(2) advanced combustion equipment and processes that the 

 Secretary determines will be cost-effective and could 

 substantially contribute to meeting environmental or energy 

 needs, including gasification, gasification fuel cells, 

 gasification coproduction, oxidation combustion techniques, 

 ultra-supercritical boilers, and chemical looping; and

 ``(3) hybrid gasification/combustion systems, including 

 systems integrating fuel cells with gasification or combustion 

 units.

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 ``(b) Criteria.--The Secretary shall establish criteria for the 

selection of generation projects under section 3102(a)(1). The Secretary 

may modify the criteria as appropriate to reflect improvements in 

equipment, except that the criteria shall not be modified to be less 

stringent. The selection criteria shall include--

 ``(1) prioritization of projects whose installation is 

 likely to result in significant air quality improvements in 

 nonattainment air quality areas;

 ``(2) prioritization of projects whose installation is 

 likely to result in lower emission rates of pollution;

 ``(3) prioritization of projects that result in the 

 repowering or replacement of older, less efficient units;

 ``(4) documented broad interest in the procurement of the 

 equipment and utilization of the processes used in the projects 

 by owners or operators of facilities for electricity generation;

 ``(5) equipment and processes beginning in 2006 through 2011 

 that are projected to achieve a thermal efficiency of--

 ``(A) 40 percent for coal of more than 9,000 Btu per 

 pound based on higher heating values;

 ``(B) 38 percent for coal of 7,000 to 9,000 Btu per 

 pound passed on higher heating values; and

 ``(C) 36 percent for coal of less than 7,000 Btu per 

 pound based on higher heating values;

 except that energy used for coproduction or cogeneration shall 

 not be counted in calculating the thermal efficiency under this 

 paragraph; and

 ``(6) equipment and processes beginning in 2012 and 2013 

 that are projected to achieve a thermal efficiency of--

 ``(A) 45 percent for coal of more than 9,000 Btu per 

 pound based on higher heating values;

 ``(B) 44 percent for coal of 7,000 to 9,000 Btu per 

 pound passed on higher heating values; and

[[Page 119 STAT. 759]]

 ``(C) 40 percent for coal of less than 7,000 Btu per 

 pound based on higher heating values;

 except that energy used for coproduction or cogeneration shall 

 not be counted in calculating the thermal efficiency under this 

 paragraph.

 ``(c) Program Balance and Priority.--In carrying out the program 

under section 3102(a)(1), the Secretary shall ensure, to the extent 

practicable, that--

 ``(1) between 25 percent and 75 percent of the projects 

 supported are for the sole purpose of electrical generation; and

 ``(2) priority is given to projects that use electrical 

 generation equipment and processes that have been developed and 

 demonstrated and applied in actual production of electricity, 

 but are not yet cost-competitive, and that achieve greater 

 efficiency and environmental performance.

 ``(d) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out section 3102(a)(1)--

 ``(1) $250,000,000 for fiscal year 2007;

 ``(2) $350,000,000 for fiscal year 2008;

 ``(3) $400,000,000 for each of fiscal years 2009 through 

 2012; and

 ``(4) $300,000,000 for fiscal year 2013.

 ``(e) Applicability.--No technology, or level of emission reduction, 

shall be treated as adequately demonstrated for purpose of section 111 

of the Clean Air Act (42 U.S.C. 7411), achievable for purposes of 

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section 169 of that Act (42 U.S.C. 7479), or achievable in practice for 

purposes of section 171 of that Act (42 U.S.C. 7501) solely by reason of 

the use of such technology, or the achievement of such emission 

reduction, by one or more facilities receiving assistance under section 

3102(a)(1).

``SEC. 3104. <<NOTE: 42 USC 13574.>> AIR QUALITY ENHANCEMENT PROGRAM.

 ``(a) Eligible Projects.--Projects supported under section 

3102(a)(2) shall--

 ``(1) utilize technologies that meet relevant Federal and 

 State clean air requirements applicable to the unit or facility, 

 including being adequately demonstrated for purposes of section 

 111 of the Clean Air Act (42 U.S.C. 7411), achievable for 

 purposes of section 169 of that Act (42 U.S.C. 7479), or 

 achievable in practice for purposes of section 171 of that Act 

 (42 U.S.C. 7501); or

 ``(2) utilize equipment or processes that exceed relevant 

 Federal or State clean air requirements applicable to the unit 

 or facilities included in the projects by achieving greater 

 efficiency or environmental performance.

 ``(b) Priority in Project Selection.--In making an award under 

section 3102(a)(2), the Secretary shall give priority to--

 ``(1) projects whose installation is likely to result in 

 significant air quality improvements in nonattainment air 

 quality areas or substantially reduce the emission level of 

 criteria pollutants and mercury air emissions;

 ``(2) projects for pollution control that result in the 

 mitigation or collection of more than 1 pollutant; and

 ``(3) projects designed to allow the use of the waste 

 byproducts or other byproducts of the equipment.

[[Page 119 STAT. 760]]

 ``(c) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out section 3102(a)(2)--

 ``(1) $300,000,000 for fiscal year 2007;

 ``(2) $100,000,000 for fiscal year 2008;

 ``(3) $40,000,000 for fiscal year 2009;

 ``(4) $30,000,000 for fiscal year 2010; and

 ``(5) $30,000,000 for fiscal year 2011.

 ``(d) Applicability.--No technology, or level of emission reduction 

under subsection (a)(2) shall be treated as adequately demonstrated for 

purpose of Section 111 of the Clean Air Act (42 U.S.C. 7411), achievable 

for purposes of section 169 of that Act (42 U.S.C. 7479), or achievable 

in practice for purposes of section 171 of that Act (42 U.S.C. 7501) 

solely by reason of the use of such technology, or the achievement of 

such emission reduction, by one or more facilities receiving assistance 

under section 3102(a)(2).''.

 (b) Table of Contents Amendment.--The table of contents of the 

Energy Policy Act of 1992 (42 U.S.C. prec. 13201) is amended by adding 

at the end the following:

 ``TITLE XXXI--CLEAN AIR COAL PROGRAM

 ``Sec. 3101. Purposes.

 ``Sec. 3102. Authorization of program.

 ``Sec. 3103. Generation projects.

 ``Sec. 3104. Air quality enhancement program.''.

Subtitle D--Federal <<NOTE: Coal Leasing Amendments Act of 2005.>> Coal 

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Leases

SEC. 431. <<NOTE: 42 USC 15801.>> SHORT TITLE.

 This subtitle may be cited as the ``Coal Leasing Amendments Act of 

2005''.

SEC. 432. REPEAL OF THE 160-ACRE LIMITATION FOR COAL LEASES.

 Section 3 of the Mineral Leasing Act (30 U.S.C. 203) is amended--

 (1) in the first sentence, by striking ``Any person'' and 

 inserting the following: ``(a)(1) Except as provided in 

 paragraph (3), on a finding by the Secretary under paragraph 

 (2), any person'';

 (2) in the second sentence, by striking ``The Secretary'' 

 and inserting the following:

 ``(b) The Secretary'';

 (3) in the third sentence, by striking ``The minimum'' and 

 inserting the following:

 ``(c) The minimum'';

 (4) in subsection (a) (as designated by paragraph (1))--

 (A) by striking ``upon'' and all that follows and 

 inserting the following: ``secure modifications of the 

 original coal lease by including additional coal lands 

 or coal deposits contiguous or cornering to those 

 embraced in the lease.''; and

 (B) by adding at the end the following:

 ``(2) A finding referred to in paragraph (1) is a finding by the 

Secretary that the modifications--

 ``(A) would be in the interest of the United States;

 ``(B) would not displace a competitive interest in the 

 lands; and

[[Page 119 STAT. 761]]

 ``(C) would not include lands or deposits that can be 

 developed as part of another potential or existing operation.

 ``(3) In no case shall the total area added by modifications to an 

existing coal lease under paragraph (1)--

 ``(A) exceed 960 acres; or

 ``(B) add acreage larger than that in the original lease.''.

SEC. 433. APPROVAL OF LOGICAL MINING UNITS.

 Section 2(d)(2) of the Mineral Leasing Act (30 U.S.C. 202a(2)) is 

amended--

 (1) by inserting ``(A)'' after ``(2)''; and

 (2) by adding at the end the following:

 ``(B) The Secretary may establish a period of more than 40 years if 

the Secretary determines that the longer period--

 ``(i) will ensure the maximum economic recovery of a coal 

 deposit; or

 ``(ii) the longer period is in the interest of the orderly, 

 efficient, or economic development of a coal resource.''.

SEC. 434. PAYMENT OF ADVANCE ROYALTIES UNDER COAL LEASES.

 Section 7(b) of the Mineral Leasing Act (30 U.S.C. 207(b)) is 

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amended--

 (1) in the first sentence, by striking ``Each lease'' and 

 inserting the following: ``(1) Each lease'';

 (2) in the second sentence, by striking ``The Secretary'' 

 and inserting the following:

 ``(2) The Secretary'';

 (3) in the third sentence, by striking ``Such advance 

 royalties'' and inserting the following:

 ``(3) Advance royalties described in paragraph (2)'';

 (4) in the seventh sentence, by striking ``The Secretary'' 

 and inserting the following:

 ``(6) The Secretary'';

 (5) in the last sentence, by striking ``Nothing'' and 

 inserting the following:

 ``(7) Nothing'';

 (6) by striking the fourth, fifth, and sixth sentences; and

 (7) by inserting after paragraph (3) (as designated by 

 paragraph (3)) the following:

 ``(4) Advance royalties described in paragraph (2) shall be 

computed--

 ``(A) based on--

 ``(i) the average price in the spot market for sales 

 of comparable coal from the same region during the last 

 month of each applicable continued operation year; or

 ``(ii) in the absence of a spot market for 

 comparable coal from the same region, by using a 

 comparable method established by the Secretary of the 

 Interior to capture the commercial value of coal; and

 ``(B) based on commercial quantities, as defined by 

 regulation by the Secretary of the Interior.

 ``(5) The aggregate number of years during the period of any lease 

for which advance royalties may be accepted in lieu of the condition of 

continued operation shall not exceed 20 years.

 ``(6) The amount of any production royalty paid for any year shall 

be reduced (but not below 0) by the amount of any advance royalties paid 

under a lease described in paragraph (5) to the

[[Page 119 STAT. 762]]

extent that the advance royalties have not been used to reduce 

production royalties for a prior year.''.

SEC. 435. ELIMINATION OF DEADLINE FOR SUBMISSION OF COAL LEASE OPERATION 

 AND RECLAMATION PLAN.

 Section 7(c) of the Mineral Leasing Act (30 U.S.C. 207(c)) is 

amended by striking ``and not later than three years after a lease is 

issued,''.

SEC. 436. AMENDMENT RELATING TO FINANCIAL ASSURANCES WITH RESPECT TO 

 BONUS BIDS.

 Section 2(a) of the Mineral Leasing Act (30 U.S.C. 201(a)) is 

amended by adding at the end the following:

 ``(4)(A) The Secretary shall not require a surety bond or any other 

financial assurance to guarantee payment of deferred bonus bid 

installments with respect to any coal lease issued on a cash bonus bid 

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to a lessee or successor in interest having a history of a timely 

payment of noncontested coal royalties and advanced coal royalties in 

lieu of production (where applicable) and bonus bid installment 

payments.

 ``(B) The Secretary may waive any requirement that a lessee provide 

a surety bond or other financial assurance to guarantee payment of 

deferred bonus bid installment with respect to any coal lease issued 

before the date of the enactment of the Energy Policy Act of 2005 only 

if the Secretary determines that the lessee has a history of making 

timely payments referred to in subparagraph (A).

 ``(5) <<NOTE: Deadline. Notices.>> Notwithstanding any other 

provision of law, if the lessee under a coal lease fails to pay any 

installment of a deferred cash bonus bid within 10 days after the 

Secretary provides written notice that payment of the installment is 

past due--

 ``(A) the lease shall automatically terminate; and

 ``(B) any bonus payments already made to the United States 

 with respect to the lease shall not be returned to the lessee or 

 credited in any future lease sale.''.

SEC. 437. <<NOTE: 42 USC 15991.>> INVENTORY REQUIREMENT.

 (a) Review of Assessments.--

 (1) In general.--The Secretary of the Interior, in 

 consultation with the Secretary of Agriculture and the 

 Secretary, shall review coal assessments and other available 

 data to identify--

 (A) Federal lands with coal resources that are 

 available for development;

 (B) the extent and nature of any restrictions on the 

 development of coal resources on Federal lands 

 identified under paragraph (1); and

 (C) with respect to areas of such lands for which 

 sufficient data exists, resources of compliant coal and 

 supercompliant coal.

 (2) Definitions.--For purposes of this subsection--

 (A) the term ``compliant coal'' means coal that 

 contains not less than 1.0 and not more than 1.2 pounds 

 of sulfur dioxide per million Btu; and

 (B) the term ``supercompliant coal'' means coal that 

 contains less than 1.0 pounds of sulfur dioxide per 

 million Btu.

 (b) Completion and Updating of the Inventory.--The Sec- retary--

[[Page 119 STAT. 763]]

 (1) <<NOTE: Deadline.>> shall complete the inventory under 

 subsection (a) by not later than 2 years after the date of 

 enactment of this Act; and

 (2) shall update the inventory as the availability of data 

 and developments in technology warrant.

 (c) Report.--The Secretary shall submit to the Committee on 

Resources of the House of Representatives and to the Committee on Energy 

and Natural Resources of the Senate and make publicly available--

 (1) a report containing the inventory under this section, by 

 not later than 2 years after the effective date of this section; 

 and

 (2) each update of such inventory.

SEC. 438. <<NOTE: 30 USC 201 note.>> APPLICATION OF AMENDMENTS.

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 The amendments made by this subtitle apply with respect to any coal 

lease issued before, on, or after the date of the enactment of this Act.

 TITLE V--INDIAN <<NOTE: Indian Tribal Energy Development and SelfDetermination Act of 2005.>> ENERGY

SEC. 501. <<NOTE: 42 USC 15801 note.>> SHORT TITLE.

 This title may be cited as the ``Indian Tribal Energy Development 

and Self-Determination Act of 2005''.

SEC. 502. OFFICE OF INDIAN ENERGY POLICY AND PROGRAMS.

 (a) In General.--Title II of the Department of Energy Organization 

Act (42 U.S.C. 7131 et seq.) is amended by adding at the end the 

following:

 ``office of indian energy policy and programs

 ``Sec. 217. (a) Establishment.--There <<NOTE: 42 USC 7144e.>> is 

established within the Department an Office of Indian Energy Policy and 

Programs (referred to in this section as the `Office'). The Office shall 

be headed by a Director, who shall be appointed by the Secretary and 

compensated at a rate equal to that of level IV of the Executive 

Schedule under section 5315 of title 5, United States Code.

 ``(b) Duties of Director.--The Director, in accordance with Federal 

policies promoting Indian self-determination and the purposes of this 

Act, shall provide, direct, foster, coordinate, and implement energy 

planning, education, management, conservation, and delivery programs of 

the Department that--

 ``(1) promote Indian tribal energy development, efficiency, 

 and use;

 ``(2) reduce or stabilize energy costs;

 ``(3) enhance and strengthen Indian tribal energy and 

 economic infrastructure relating to natural resource development 

 and electrification; and

 ``(4) bring electrical power and service to Indian land and 

 the homes of tribal members located on Indian lands or acquired, 

 constructed, or improved (in whole or in part) with Federal 

 funds.''.

 (b) Conforming Amendments.--

 (1) The table of contents of the Department of Energy 

 Organization Act (42 U.S.C. prec. 7101) is amended--

[[Page 119 STAT. 764]]

 (A) in the item relating to section 209, by striking 

 ``Section'' and inserting ``Sec.''; and

 (B) by striking the items relating to sections 213 

 through 216 and inserting the following:

``Sec. 213. Establishment of policy for National Nuclear Security 

 Administration.

``Sec. 214. Establishment of security, counterintelligence, and 

 intelligence policies.

``Sec. 215. Office of Counterintelligence.

``Sec. 216. Office of Intelligence.

``Sec. 217. Office of Indian Energy Policy and Programs.''.

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 (2) Section 5315 of title 5, United States Code, is amended 

 by inserting after the item related to the Inspector General, 

 Department of Energy the following new item:

 ``Director, Office of Indian Energy Policy and Programs, 

 Department of Energy.''.

SEC. 503. INDIAN ENERGY.

 (a) In General.--Title XXVI of the Energy Policy Act of 1992 (25 

U.S.C. 3501 et seq.) is amended to read as follows:

 ``TITLE XXVI--INDIAN ENERGY

``SEC. 2601. <<NOTE: 25 USC 3501.>> DEFINITIONS.

 ``In this title:

 ``(1) The term `Director' means the Director of the Office 

 of Indian Energy Policy and Programs, Department of Energy.

 ``(2) The term `Indian land' means--

 ``(A) any land located within the boundaries of an 

 Indian reservation, pueblo, or rancheria;

 ``(B) any land not located within the boundaries of 

 an Indian reservation, pueblo, or rancheria, the title 

 to which is held--

 ``(i) in trust by the United States for the 

 benefit of an Indian tribe or an individual 

 Indian;

 ``(ii) by an Indian tribe or an individual 

 Indian, subject to restriction against alienation 

 under laws of the United States; or

 ``(iii) by a dependent Indian community; and

 ``(C) land that is owned by an Indian tribe and was 

 conveyed by the United States to a Native Corporation 

 pursuant to the Alaska Native Claims Settlement Act (43 

 U.S.C. 1601 et seq.), or that was conveyed by the United 

 States to a Native Corporation in exchange for such 

 land.

 ``(3) The term `Indian reservation' includes--

 ``(A) an Indian reservation in existence in any 

 State or States as of the date of enactment of this 

 paragraph;

 ``(B) a public domain Indian allotment; and

 ``(C) a dependent Indian community located within 

 the borders of the United States, regardless of whether 

 the community is located--

 ``(i) on original or acquired territory of the 

 community; or

 ``(ii) within or outside the boundaries of any 

 State or States.

 ``(4)(A) The term `Indian tribe' has the meaning given the 

 term in section 4 of the Indian Self-Determination and Education 

 Assistance Act (25 U.S.C. 450b).

[[Page 119 STAT. 765]]

 ``(B) For the purpose of paragraph (12) and sections 

 2603(b)(1)(C) and 2604, the term `Indian tribe' does not include 

 any Native Corporation.

 ``(5) The term `integration of energy resources' means any 

 project or activity that promotes the location and operation of 

 a facility (including any pipeline, gathering system, 

 transportation system or facility, or electric transmission or 

 distribution facility) on or near Indian land to process, 

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 refine, generate electricity from, or otherwise develop energy 

 resources on, Indian land.

 ``(6) The term `Native Corporation' has the meaning given 

 the term in section 3 of the Alaska Native Claims Settlement Act 

 (43 U.S.C. 1602).

 ``(7) The term `organization' means a partnership, joint 

 venture, limited liability company, or other unincorporated 

 association or entity that is established to develop Indian 

 energy resources.

 ``(8) The term `Program' means the Indian energy resource 

 development program established under section 2602(a).

 ``(9) The term `Secretary' means the Secretary of the 

 Interior.

 ``(10) The term `sequestration' means the long-term 

 separation, isolation, or removal of greenhouse gases from the 

 atmosphere, including through a biological or geologic method 

 such as reforestation or an underground reservoir.

 ``(11) The term `tribal energy resource development 

 organization' means an organization of two or more entities, at 

 least one of which is an Indian tribe, that has the written 

 consent of the governing bodies of all Indian tribes 

 participating in the organization to apply for a grant, loan, or 

 other assistance under section 2602.

 ``(12) The term `tribal land' means any land or interests in 

 land owned by any Indian tribe, title to which is held in trust 

 by the United States, or is subject to a restriction against 

 alienation under laws of the United States.

``SEC. 2602. <<NOTE: 25 USC 3502.>> INDIAN TRIBAL ENERGY RESOURCE 

 DEVELOPMENT.

 ``(a) Department of the Interior Program.--

 ``(1) To assist Indian tribes in the development of energy 

 resources and further the goal of Indian self-determination, the 

 Secretary shall establish and implement an Indian energy 

 resource development program to assist consenting Indian tribes 

 and tribal energy resource development organizations in 

 achieving the purposes of this title.

 ``(2) <<NOTE: Grants.>> In carrying out the Program, the 

 Secretary shall--

 ``(A) provide development grants to Indian tribes 

 and tribal energy resource development organizations for 

 use in developing or obtaining the managerial and 

 technical capacity needed to develop energy resources on 

 Indian land, and to properly account for resulting 

 energy production and revenues;

 ``(B) provide grants to Indian tribes and tribal 

 energy resource development organizations for use in 

 carrying out projects to promote the integration of 

 energy resources, and to process, use, or develop those 

 energy resources, on Indian land;

[[Page 119 STAT. 766]]

 ``(C) <<NOTE: Loans.>> provide low-interest loans to 

 Indian tribes and tribal energy resource development 

 organizations for use in the promotion of energy 

 resource development on Indian land and integration of 

 energy resources; and

 ``(D) provide grants and technical assistance to an 

 appropriate tribal environmental organization, as 

 determined by the Secretary, that represents multiple 

 Indian tribes to establish a national resource center to 

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 develop tribal capacity to establish and carry out 

 tribal environmental programs in support of energy-

 related programs and activities under this title, 

 including--

 ``(i) training programs for tribal 

 environmental officials, program managers, and 

 other governmental representatives;

 ``(ii) the development of model environmental 

 policies and tribal laws, including tribal 

 environmental review codes, and the creation and 

 maintenance of a clearinghouse of best 

 environmental management practices; and

 ``(iii) recommended standards for reviewing 

 the implementation of tribal environmental laws 

 and policies within tribal judicial or other 

 tribal appeals systems.

 ``(3) <<NOTE: Appropriation authorization.>> There are 

 authorized to be appropriated to carry out this subsection such 

 sums as are necessary for each of fiscal years 2006 through 

 2016.

 ``(b) Department of Energy Indian Energy Education Planning and 

Management Assistance Program.--

 ``(1) The Director shall establish programs to assist 

 consenting Indian tribes in meeting energy education, research 

 and development, planning, and management needs.

 ``(2) In carrying out this subsection, the Director may 

 provide grants, on a competitive basis, to an Indian tribe or 

 tribal energy resource development organization for use in 

 carrying out--

 ``(A) energy, energy efficiency, and energy 

 conservation programs;

 ``(B) studies and other activities supporting tribal 

 acquisitions of energy supplies, services, and 

 facilities, including the creation of tribal utilities 

 to assist in securing electricity to promote 

 electrification of homes and businesses on Indian land;

 ``(C) planning, construction, development, 

 operation, maintenance, and improvement of tribal 

 electrical generation, transmission, and distribution 

 facilities located on Indian land; and

 ``(D) development, construction, and interconnection 

 of electric power transmission facilities located on 

 Indian land with other electric transmission facilities.

 ``(3)(A) The Director shall develop a program to support and 

 implement research projects that provide Indian tribes with 

 opportunities to participate in carbon sequestration practices 

 on Indian land, including--

 ``(i) geologic sequestration;

 ``(ii) forest sequestration;

 ``(iii) agricultural sequestration; and

[[Page 119 STAT. 767]]

 ``(iv) any other sequestration opportunities the 

 Director considers to be appropriate.

 ``(B) The activities carried out under subparagraph (A) 

 shall be--

 ``(i) coordinated with other carbon sequestration 

 research and development programs conducted by the 

 Secretary of Energy;

 ``(ii) conducted to determine methods consistent 

 with existing standardized measurement protocols to 

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 account and report the quantity of carbon dioxide or 

 other greenhouse gases sequestered in projects that may 

 be implemented on Indian land; and

 ``(iii) reviewed periodically to collect and 

 distribute to Indian tribes information on carbon 

 sequestration practices that will increase the 

 sequestration of carbon without threatening the social 

 and economic well-being of Indian tribes.

 ``(4)(A) The Director, in consultation with Indian tribes, 

 may develop a formula for providing grants under this 

 subsection.

 ``(B) In providing a grant under this subsection, the 

 Director shall give priority to any application received from an 

 Indian tribe with inadequate electric service (as determined by 

 the Director).

 ``(C) In providing a grant under this subsection for an 

 activity to provide, or expand the provision of, electricity on 

 Indian land, the Director shall encourage cooperative 

 arrangements between Indian tribes and utilities that provide 

 service to Indian tribes, as the Director determines to be 

 appropriate.

 ``(5) The Secretary of Energy may issue such regulations as 

 the Secretary determines to be necessary to carry out this 

 subsection.

 ``(6) <<NOTE: Appropriation authorization.>> There is 

 authorized to be appropriated to carry out this subsection 

 $20,000,000 for each of fiscal years 2006 through 2016.

 ``(c) Department of Energy Loan Guarantee Program.--

 ``(1) Subject to paragraphs (2) and (4), the Secretary of 

 Energy may provide loan guarantees (as defined in section 502 of 

 the Federal Credit Reform Act of 1990 (2 U.S.C. 661a)) for an 

 amount equal to not more than 90 percent of the unpaid principal 

 and interest due on any loan made to an Indian tribe for energy 

 development.

 ``(2) In providing a loan guarantee under this subsection 

 for an activity to provide, or expand the provision of, 

 electricity on Indian land, the Secretary of Energy shall 

 encourage cooperative arrangements between Indian tribes and 

 utilities that provide service to Indian tribes, as the 

 Secretary determines to be appropriate.

 ``(3) A loan guarantee under this subsection shall be made 

 by--

 ``(A) a financial institution subject to examination 

 by the Secretary of Energy; or

 ``(B) an Indian tribe, from funds of the Indian 

 tribe.

 ``(4) The aggregate outstanding amount guaranteed by the 

 Secretary of Energy at any time under this subsection shall not 

 exceed $2,000,000,000.

[[Page 119 STAT. 768]]

 ``(5) <<NOTE: Appropriation authorization.>> The Secretary 

 of Energy may issue such regulations as the Secretary of Energy 

 determines are necessary to carry out this subsection.

 ``(6) There are authorized to be appropriated such sums as 

 are necessary to carry out this subsection, to remain available 

 until expended.

 ``(7) <<NOTE: Deadline. Reports.>> Not later than 1 year 

 after the date of enactment of this section, the Secretary of 

 Energy shall submit to Congress a report on the financing 

 requirements of Indian tribes for energy development on Indian 

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 land.

 ``(d) Preference.--

 ``(1) In purchasing electricity or any other energy product 

 or byproduct, a Federal agency or department may give preference 

 to an energy and resource production enterprise, partnership, 

 consortium, corporation, or other type of business organization 

 the majority of the interest in which is owned and controlled by 

 1 or more Indian tribes.

 ``(2) In carrying out this subsection, a Federal agency or 

 department shall not--

 ``(A) pay more than the prevailing market price for 

 an energy product or byproduct; or

 ``(B) obtain less than prevailing market terms and 

 conditions.

``SEC. 2603. <<NOTE: 25 USC 3503.>> INDIAN TRIBAL ENERGY RESOURCE 

 REGULATION.

 ``(a) Grants.--The Secretary may provide to Indian tribes, on an 

annual basis, grants for use in accordance with subsection (b).

 ``(b) Use of Funds.--Funds from a grant provided under this section 

may be used--

 ``(1)(A) by an Indian tribe for the development of a tribal 

 energy resource inventory or tribal energy resource on Indian 

 land;

 ``(B) by an Indian tribe for the development of a 

 feasibility study or other report necessary to the development 

 of energy resources on Indian land;

 ``(C) by an Indian tribe (other than an Indian Tribe in the 

 State of Alaska, except the Metlakatla Indian Community) for--

 ``(i) the development and enforcement of tribal laws 

 (including regulations) relating to tribal energy 

 resource development; and

 ``(ii) the development of technical infrastructure 

 to protect the environment under applicable law; or

 ``(D) by a Native Corporation for the development and 

 implementation of corporate policies and the development of 

 technical infrastructure to protect the environment under 

 applicable law; and

 ``(2) by an Indian tribe for the training of employees 

 that--

 ``(A) are engaged in the development of energy 

 resources on Indian land; or

 ``(B) are responsible for protecting the 

 environment.

 ``(c) Other Assistance.--

 ``(1) In carrying out the obligations of the United States 

 under this title, the Secretary shall ensure, to the maximum 

 extent practicable and to the extent of available resources, 

 that on the request of an Indian tribe, the Indian tribe shall

[[Page 119 STAT. 769]]

 have available scientific and technical information and 

 expertise, for use in the regulation, development, and 

 management of energy resources of the Indian tribe on Indian 

 land.

 ``(2) The Secretary may carry out paragraph (1)--

 ``(A) directly, through the use of Federal 

 officials; or

 ``(B) indirectly, by providing financial assistance 

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 to an Indian tribe to secure independent assistance.

``SEC. 2604. <<NOTE: 25 USC 3504.>> LEASES, BUSINESS AGREEMENTS, AND 

 RIGHTS-OF-WAY INVOLVING ENERGY DEVELOPMENT OR TRANSMISSION.

 ``(a) Leases and Business Agreements.--In accordance with this 

section--

 ``(1) an Indian tribe may, at the discretion of the Indian 

 tribe, enter into a lease or business agreement for the purpose 

 of energy resource development on tribal land, including a lease 

 or business agreement for--

 ``(A) exploration for, extraction of, processing of, 

 or other development of the energy mineral resources of 

 the Indian tribe located on tribal land; or

 ``(B) construction or operation of--

 ``(i) an electric generation, transmission, or 

 distribution facility located on tribal land; or

 ``(ii) a facility to process or refine energy 

 resources developed on tribal land; and

 ``(2) a lease or business agreement described in paragraph 

 (1) shall not require review by or the approval of the Secretary 

 under section 2103 of the Revised Statutes (25 U.S.C. 81), or 

 any other provision of law, if--

 ``(A) the lease or business agreement is executed 

 pursuant to a tribal energy resource agreement approved 

 by the Secretary under subsection (e);

 ``(B) the term of the lease or business agreement 

 does not exceed--

 ``(i) 30 years; or

 ``(ii) in the case of a lease for the 

 production of oil resources, gas resources, or 

 both, 10 years and as long thereafter as oil or 

 gas is produced in paying quantities; and

 ``(C) the Indian tribe has entered into a tribal 

 energy resource agreement with the Secretary, as 

 described in subsection (e), relating to the development 

 of energy resources on tribal land (including the 

 periodic review and evaluation of the activities of the 

 Indian tribe under the agreement, to be conducted 

 pursuant to subsection (e)(2)(D)(i)).

 ``(b) Rights-of-Way for Pipelines or Electric Transmission or 

Distribution Lines.--An Indian tribe may grant a right-of-way over 

tribal land for a pipeline or an electric transmission or distribution 

line without review or approval by the Secretary if--

 ``(1) the right-of-way is executed in accordance with a 

 tribal energy resource agreement approved by the Secretary under 

 subsection (e);

 ``(2) the term of the right-of-way does not exceed 30 years;

 ``(3) the pipeline or electric transmission or distribution 

 line serves--

[[Page 119 STAT. 770]]

 ``(A) an electric generation, transmission, or 

 distribution facility located on tribal land; or

 ``(B) a facility located on tribal land that 

 processes or refines energy resources developed on 

 tribal land; and

 ``(4) the Indian tribe has entered into a tribal energy 

 resource agreement with the Secretary, as described in 

 subsection (e), relating to the development of energy resources 

 on tribal land (including the periodic review and evaluation of 

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 the activities of the Indian tribe under an agreement described 

 in subparagraphs (D) and (E) of subsection (e)(2)).

 ``(c) Renewals.--A lease or business agreement entered into, or a 

right-of-way granted, by an Indian tribe under this section may be 

renewed at the discretion of the Indian tribe in accordance with this 

section.

 ``(d) Validity.--No lease, business agreement, or right-of-way 

relating to the development of tribal energy resources under this 

section shall be valid unless the lease, business agreement, or rightof-way is authorized by a tribal energy resource agreement approved by 

the Secretary under subsection (e)(2).

 ``(e) Tribal Energy Resource Agreements.--

 ``(1) On the date on which regulations are promulgated under 

 paragraph (8), an Indian tribe may submit to the Secretary for 

 approval a tribal energy resource agreement governing leases, 

 business agreements, and rights-of-way under this section.

 ``(2)(A) <<NOTE: Deadlines.>> Not later than 270 days after 

 the date on which the Secretary receives a tribal energy 

 resource agreement from an Indian tribe under paragraph (1), or 

 not later than 60 days after the Secretary receives a revised 

 tribal energy resource agreement from an Indian tribe under 

 paragraph (4)(C) (or a later date, as agreed to by the Secretary 

 and the Indian tribe), the Secretary shall approve or disapprove 

 the tribal energy resource agreement.

 ``(B) The Secretary shall approve a tribal energy resource 

 agreement submitted under paragraph (1) if--

 ``(i) the Secretary determines that the Indian tribe 

 has demonstrated that the Indian tribe has sufficient 

 capacity to regulate the development of energy resources 

 of the Indian tribe;

 ``(ii) the tribal energy resource agreement includes 

 provisions required under subparagraph (D); and

 ``(iii) the tribal energy resource agreement 

 includes provisions that, with respect to a lease, 

 business agreement, or right-of-way under this section--

 ``(I) ensure the acquisition of necessary 

 information from the applicant for the lease, 

 business agreement, or right-of-way;

 ``(II) address the term of the lease or 

 business agreement or the term of conveyance of 

 the right-of-way;

 ``(III) address amendments and renewals;

 ``(IV) address the economic return to the 

 Indian tribe under leases, business agreements, 

 and rights-of-way;

 ``(V) address technical or other relevant 

 requirements;

[[Page 119 STAT. 771]]

 ``(VI) establish requirements for 

 environmental review in accordance with 

 subparagraph (C);

 ``(VII) ensure compliance with all applicable 

 environmental laws, including a requirement that 

 each lease, business agreement, and right-of-way 

 state that the lessee, operator, or right-of-way 

 grantee shall comply with all such laws;

 ``(VIII) identify final approval authority;

 ``(IX) provide for public notification of 

 final approvals;

 ``(X) establish a process for consultation 

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 with any affected States regarding off-reservation 

 impacts, if any, identified under subparagraph 

 (C)(i);

 ``(XI) describe the remedies for breach of the 

 lease, business agreement, or right-of-way;

 ``(XII) require each lease, business 

 agreement, and right-of-way to include a statement 

 that, if any of its provisions violates an express 

 term or requirement of the tribal energy resource 

 agreement pursuant to which the lease, business 

 agreement, or right-of-way was executed--

 ``(aa) the provision shall be null 

 and void; and

 ``(bb) if the Secretary determines 

 the provision to be material, the 

 Secretary may suspend or rescind the 

 lease, business agreement, or right-of-

 way or take other appropriate action 

 that the Secretary determines to be in 

 the best interest of the Indian tribe;

 ``(XIII) require each lease, business 

 agreement, and right-of-way to provide that it 

 will become effective on the date on which a copy 

 of the executed lease, business agreement, or 

 right-of-way is delivered to the Secretary in 

 accordance with regulations promulgated under 

 paragraph (8);

 ``(XIV) include citations to tribal laws, 

 regulations, or procedures, if any, that set out 

 tribal remedies that must be exhausted before a 

 petition may be submitted to the Secretary under 

 paragraph (7)(B);

 ``(XV) specify the financial assistance, if 

 any, to be provided by the Secretary to the Indian 

 tribe to assist in implementation of the tribal 

 energy resource agreement, including environmental 

 review of individual projects; and

 ``(XVI) in accordance with the regulations 

 promulgated by the Secretary under paragraph (8), 

 require that the Indian tribe, as soon as 

 practicable after receipt of a notice by the 

 Indian tribe, give written notice to the Secretary 

 of--

 ``(aa) any breach or other violation 

 by another party of any provision in a 

 lease, business agreement, or right-of-

 way entered into under the tribal energy 

 resource agreement; and

 ``(bb) any activity or occurrence 

 under a lease, business agreement, or 

 right-of-way that constitutes a 

 violation of Federal or tribal 

 environmental laws.

[[Page 119 STAT. 772]]

 ``(C) Tribal energy resource agreements submitted 

 under paragraph (1) shall establish, and include 

 provisions to ensure compliance with, an environmental 

 review process that, with respect to a lease, business 

 agreement, or right-of-way under this section, provides 

 for, at a minimum--

 ``(i) the identification and evaluation of all 

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 significant environmental effects (as compared to 

 a no-action alternative), including effects on 

 cultural resources;

 ``(ii) the identification of proposed 

 mitigation measures, if any, and incorporation of 

 appropriate mitigation measures into the lease, 

 business agreement, or right-of-way;

 ``(iii) a process for ensuring that--

 ``(I) the public is informed of, and 

 has an opportunity to comment on, the 

 environmental impacts of the proposed 

 action; and

 ``(II) responses to relevant and 

 substantive comments are provided, 

 before tribal approval of the lease, 

 business agreement, or right-of-way;

 ``(iv) sufficient administrative support and 

 technical capability to carry out the 

 environmental review process; and

 ``(v) oversight by the Indian tribe of energy 

 development activities by any other party under 

 any lease, business agreement, or right-of-way 

 entered into pursuant to the tribal energy 

 resource agreement, to determine whether the 

 activities are in compliance with the tribal 

 energy resource agreement and applicable Federal 

 environmental laws.

 ``(D) A tribal energy resource agreement between the 

 Secretary and an Indian tribe under this subsection 

 shall include--

 ``(i) provisions requiring the Secretary to 

 conduct a periodic review and evaluation to 

 monitor the performance of the activities of the 

 Indian tribe associated with the development of 

 energy resources under the tribal energy resource 

 agreement; and

 ``(ii) if a periodic review and evaluation, or 

 an investigation, by the Secretary of any breach 

 or violation described in a notice provided by the 

 Indian tribe to the Secretary in accordance with 

 subparagraph (B)(iii)(XVI), results in a finding 

 by the Secretary of imminent jeopardy to a 

 physical trust asset arising from a violation of 

 the tribal energy resource agreement or applicable 

 Federal laws, provisions authorizing the Secretary 

 to take actions determined by the Secretary to be 

 necessary to protect the asset, including 

 reassumption of responsibility for activities 

 associated with the development of energy 

 resources on tribal land until the violation and 

 any condition that caused the jeopardy are 

 corrected.

 ``(E) Periodic review and evaluation under 

 subparagraph (D) shall be conducted on an annual basis, 

 except that, after the third annual review and 

 evaluation, the Secretary and the Indian tribe may 

 mutually agree to amend the tribal energy resource 

 agreement to authorize

[[Page 119 STAT. 773]]

 the review and evaluation under subparagraph (D) to be 

 conducted once every 2 years.

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 ``(3) <<NOTE: Notice. Public information.>> The Secretary 

 shall provide notice and opportunity for public comment on 

 tribal energy resource agreements submitted for approval under 

 paragraph (1). The Secretary's review of a tribal energy 

 resource agreement shall be limited to activities specified by 

 the provisions of the tribal energy resource agreement.

 ``(4) <<NOTE: Deadline.>> If the Secretary disapproves a 

 tribal energy resource agreement submitted by an Indian tribe 

 under paragraph (1), the Secretary shall, not later than 10 days 

 after the date of disapproval--

 ``(A) <<NOTE: Notification.>> notify the Indian 

 tribe in writing of the basis for the disapproval;

 ``(B) identify what changes or other actions are 

 required to address the concerns of the Secretary; and

 ``(C) provide the Indian tribe with an opportunity 

 to revise and resubmit the tribal energy resource 

 agreement.

 ``(5) If an Indian tribe executes a lease or business 

 agreement, or grants a right-of-way, in accordance with a tribal 

 energy resource agreement approved under this subsection, the 

 Indian tribe shall, in accordance with the process and 

 requirements under regulations promulgated under paragraph (8), 

 provide to the Secretary--

 ``(A) <<NOTE: Records.>> a copy of the lease, 

 business agreement, or right-of-way document (including 

 all amendments to and renewals of the document); and

 ``(B) in the case of a tribal energy resource 

 agreement or a lease, business agreement, or right-of-

 way that permits payments to be made directly to the 

 Indian tribe, information and documentation of those 

 payments sufficient to enable the Secretary to discharge 

 the trust responsibility of the United States to enforce 

 the terms of, and protect the rights of the Indian tribe 

 under, the lease, business agreement, or right-of-way.

 ``(6)(A) In carrying out this section, the Secretary shall--

 ``(i) act in accordance with the trust 

 responsibility of the United States relating to mineral 

 and other trust resources; and

 ``(ii) act in good faith and in the best interests 

 of the Indian tribes.

 ``(B) Subject to the provisions of subsections (a)(2), (b), 

 and (c) waiving the requirement of Secretarial approval of 

 leases, business agreements, and rights-of-way executed pursuant 

 to tribal energy resource agreements approved under this 

 section, and the provisions of subparagraph (D), nothing in this 

 section shall absolve the United States from any responsibility 

 to Indians or Indian tribes, including, but not limited to, 

 those which derive from the trust relationship or from any 

 treaties, statutes, and other laws of the United States, 

 Executive orders, or agreements between the United States and 

 any Indian tribe.

 ``(C) The Secretary shall continue to fulfill the trust 

 obligation of the United States to ensure that the rights and 

 interests of an Indian tribe are protected if--

 ``(i) any other party to a lease, business 

 agreement, or right-of-way violates any applicable 

 Federal law or the

[[Page 119 STAT. 774]]

 terms of any lease, business agreement, or right-of-way 

 under this section; or

 ``(ii) any provision in a lease, business agreement, 

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 or right-of-way violates the tribal energy resource 

 agreement pursuant to which the lease, business 

 agreement, or right-of-way was executed.

 ``(D)(i) In this subparagraph, the term `negotiated term' 

 means any term or provision that is negotiated by an Indian 

 tribe and any other party to a lease, business agreement, or 

 right-of-way entered into pursuant to an approved tribal energy 

 resource agreement.

 ``(ii) Notwithstanding subparagraph (B), the United States 

 shall not be liable to any party (including any Indian tribe) 

 for any negotiated term of, or any loss resulting from the 

 negotiated terms of, a lease, business agreement, or right-of-

 way executed pursuant to and in accordance with a tribal energy 

 resource agreement approved by the Secretary under paragraph 

 (2).

 ``(7)(A) In this paragraph, the term `interested party' 

 means any person (including an entity) that has demonstrated 

 that an interest of the person has sustained, or will sustain, 

 an adverse environmental impact as a result of the failure of an 

 Indian tribe to comply with a tribal energy resource agreement 

 of the Indian tribe approved by the Secretary under paragraph 

 (2).

 ``(B) After exhaustion of any tribal remedy, and in 

 accordance with regulations promulgated by the Secretary under 

 paragraph (8), an interested party may submit to the Secretary a 

 petition to review the compliance by an Indian tribe with a 

 tribal energy resource agreement of the Indian tribe approved by 

 the Secretary under paragraph (2).

 ``(C)(i) <<NOTE: Deadline.>> Not later than 20 days after 

 the date on which the Secretary receives a petition under 

 subparagraph (B), the Secretary shall--

 ``(I) <<NOTE: Records.>> provide to the Indian tribe 

 a copy of the petition; and

 ``(II) consult with the Indian tribe regarding any 

 noncompliance alleged in the petition.

 ``(ii) <<NOTE: Deadline. Claims.>> Not later than 45 days 

 after the date on which a consultation under clause (i)(II) 

 takes place, the Indian tribe shall respond to any claim made in 

 a petition under subparagraph (B).

 ``(iii) The Secretary shall act in accordance with 

 subparagraphs (D) and (E) only if the Indian tribe--

 ``(I) denies, or fails to respond to, each claim 

 made in the petition within the period described in 

 clause (ii); or

 ``(II) fails, refuses, or is unable to cure or 

 otherwise resolve each claim made in the petition within 

 a reasonable period, as determined by the Secretary, 

 after the expiration of the period described in clause 

 (ii).

 ``(D)(i) <<NOTE: Deadline.>> Not later than 120 days after 

 the date on which the Secretary receives a petition under 

 subparagraph (B), the Secretary shall determine whether the 

 Indian tribe is not in compliance with the tribal energy 

 resource agreement.

 ``(ii) The Secretary may adopt procedures under paragraph 

 (8) authorizing an extension of time, not to exceed 120 days,

[[Page 119 STAT. 775]]

 for making the determination under clause (i) in any case in 

 which the Secretary determines that additional time is necessary 

 to evaluate the allegations of the petition.

 ``(iii) Subject to subparagraph (E), if the Secretary 

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 determines that the Indian tribe is not in compliance with the 

 tribal energy resource agreement, the Secretary shall take such 

 action as the Secretary determines to be necessary to ensure 

 compliance with the tribal energy resource agreement, 

 including--

 ``(I) temporarily suspending any activity under a 

 lease, business agreement, or right-of-way under this 

 section until the Indian tribe is in compliance with the 

 approved tribal energy resource agreement; or

 ``(II) rescinding approval of all or part of the 

 tribal energy resource agreement, and if all of the 

 agreement is rescinded, reassuming the responsibility 

 for approval of any future leases, business agreements, 

 or rights-of-way described in subsection (a) or (b).

 ``(E) Before taking an action described in subparagraph 

 (D)(iii), the Secretary shall--

 ``(i) make a written determination that describes 

 the manner in which the tribal energy resource agreement 

 has been violated;

 ``(ii) <<NOTE: Notice.>> provide the Indian tribe 

 with a written notice of the violations together with 

 the written determination; and

 ``(iii) before taking any action described in 

 subparagraph (D)(iii) or seeking any other remedy, 

 provide the Indian tribe with a hearing and a reasonable 

 opportunity to attain compliance with the tribal energy 

 resource agreement.

 ``(F) An Indian tribe described in subparagraph (E) shall 

 retain all rights to appeal under any regulation promulgated by 

 the Secretary.

 ``(8) <<NOTE: Deadline. Regulations.>> Not later than 1 year 

 after the date of enactment of the Energy Policy Act of 2005, 

 the Secretary shall promulgate regulations that implement this 

 subsection, including--

 ``(A) criteria to be used in determining the 

 capacity of an Indian tribe under paragraph (2)(B)(i), 

 including the experience of the Indian tribe in managing 

 natural resources and financial and administrative 

 resources available for use by the Indian tribe in 

 implementing the approved tribal energy resource 

 agreement of the Indian tribe;

 ``(B) a process and requirements in accordance with 

 which an Indian tribe may--

 ``(i) voluntarily rescind a tribal energy 

 resource agreement approved by the Secretary under 

 this subsection; and

 ``(ii) return to the Secretary the 

 responsibility to approve any future lease, 

 business agreement, or right-of-way under this 

 subsection;

 ``(C) provisions establishing the scope of, and 

 procedures for, the periodic review and evaluation 

 described in subparagraphs (D) and (E) of paragraph (2), 

 including

[[Page 119 STAT. 776]]

 provisions for review of transactions, reports, site 

 inspections, and any other review activities the 

 Secretary determines to be appropriate; and

 ``(D) provisions describing final agency actions 

 after exhaustion of administrative appeals from 

 determinations of the Secretary under paragraph (7).

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 ``(f) No Effect on Other Law.--Nothing in this section affects the 

application of--

 ``(1) any Federal environmental law;

 ``(2) the Surface Mining Control and Reclamation Act of 1977 

 (30 U.S.C. 1201 et seq.); or

 ``(3) except as otherwise provided in this title, the Indian 

 Mineral Development Act of 1982 (25 U.S.C. 2101 et seq.).

 ``(g) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary such sums as are necessary for each of 

fiscal years 2006 through 2016 to carry out this section and to make 

grants or provide other appropriate assistance to Indian tribes to 

assist the Indian tribes in developing and implementing tribal energy 

resource agreements in accordance with this section.

``SEC. 2605. <<NOTE: 25 USC 3505.>> FEDERAL POWER MARKETING 

 ADMINISTRATIONS.

 ``(a) Definitions.--In this section:

 ``(1) The term `Administrator' means the Administrator of 

 the Bonneville Power Administration and the Administrator of the 

 Western Area Power Administration.

 ``(2) The term `power marketing administration' means--

 ``(A) the Bonneville Power Administration;

 ``(B) the Western Area Power Administration; and

 ``(C) any other power administration the power 

 allocation of which is used by or for the benefit of an 

 Indian tribe located in the service area of the 

 administration.

 ``(b) Encouragement of Indian Tribal Energy Development.--Each 

Administrator shall encourage Indian tribal energy development by taking 

such actions as the Administrators determine to be appropriate, 

including administration of programs of the power marketing 

administration, in accordance with this section.

 ``(c) Action by Administrators.--In carrying out this section, in 

accordance with laws in existence on the date of enactment of the Energy 

Policy Act of 2005--

 ``(1) each Administrator shall consider the unique 

 relationship that exists between the United States and Indian 

 tribes;

 ``(2) power allocations from the Western Area Power 

 Administration to Indian tribes may be used to meet firming and 

 reserve needs of Indian-owned energy projects on Indian land;

 ``(3) the Administrator of the Western Area Power 

 Administration may purchase non-federally generated power from 

 Indian tribes to meet the firming and reserve requirements of 

 the Western Area Power Administration; and

 ``(4) each Administrator shall not--

 ``(A) pay more than the prevailing market price for 

 an energy product; or

 ``(B) obtain less than prevailing market terms and 

 conditions.

 ``(d) Assistance for Transmission System Use.--

[[Page 119 STAT. 777]]

 ``(1) An Administrator may provide technical assistance to 

 Indian tribes seeking to use the high-voltage transmission 

 system for delivery of electric power.

 ``(2) The costs of technical assistance provided under 

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 paragraph (1) shall be funded--

 ``(A) by the Secretary of Energy using 

 nonreimbursable funds appropriated for that purpose; or

 ``(B) by any appropriate Indian tribe.

 ``(e) Power Allocation Study.--

Not <<NOTE: Deadline. Reports.>> later than 2 years after the date of 

enactment of the Energy Policy Act of 2005, the Secretary of Energy 

shall submit to Congress a report that--

 ``(1) describes the use by Indian tribes of Federal power 

 allocations of the power marketing administration (or power sold 

 by the Southwestern Power Administration) to or for the benefit 

 of Indian tribes in a service area of the power marketing 

 administration; and

 ``(2) identifies--

 ``(A) the quantity of power allocated to, or used 

 for the benefit of, Indian tribes by the Western Area 

 Power Administration;

 ``(B) the quantity of power sold to Indian tribes by 

 any other power marketing administration; and

 ``(C) barriers that impede tribal access to and use 

 of Federal power, including an assessment of 

 opportunities to remove those barriers and improve the 

 ability of power marketing administrations to deliver 

 Federal power.

 ``(f) Authorization of Appropriations.--There are authorized to be 

appropriated to carry out this section $750,000, non-reimbursable, to 

remain available until expended.

``SEC. 2606. <<NOTE: 25 USC 3506.>> WIND AND HYDROPOWER FEASIBILITY 

 STUDY.

 ``(a) Study.--The Secretary of Energy, in coordination with the 

Secretary of the Army and the Secretary, shall conduct a study of the 

cost and feasibility of developing a demonstration project that uses 

wind energy generated by Indian tribes and hydropower generated by the 

Army Corps of Engineers on the Missouri River to supply firming power to 

the Western Area Power Administration.

 ``(b) Scope of Study.--The study shall--

 ``(1) determine the economic and engineering feasibility of 

 blending wind energy and hydropower generated from the Missouri 

 River dams operated by the Army Corps of Engineers, including an 

 assessment of the costs and benefits of blending wind energy and 

 hydropower compared to current sources used for firming power to 

 the Western Area Power Administration;

 ``(2) review historical and projected requirements for, 

 patterns of availability and use of, and reasons for historical 

 patterns concerning the availability of firming power;

 ``(3) assess the wind energy resource potential on tribal 

 land and projected cost savings through a blend of wind and 

 hydropower over a 30-year period;

 ``(4) determine seasonal capacity needs and associated 

 transmission upgrades for integration of tribal wind generation 

 and identify costs associated with these activities;

 ``(5) include an independent tribal engineer and a Western 

 Area Power Administration customer representative as study team 

 members; and

[[Page 119 STAT. 778]]

 ``(6) incorporate, to the extent appropriate, the results of 

 the Dakotas Wind Transmission study prepared by the Western Area 

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 Power Administration.

 ``(c) Report.--Not later than 1 year after the date of enactment of 

the Energy Policy Act of 2005, the Secretary of Energy, the Secretary, 

and the Secretary of the Army shall submit to Congress a report that 

describes the results of the study, including--

 ``(1) an analysis and comparison of the potential energy 

 cost or benefits to the customers of the Western Area Power 

 Administration through the use of combined wind and hydropower;

 ``(2) an economic and engineering evaluation of whether a 

 combined wind and hydropower system can reduce reservoir 

 fluctuation, enhance efficient and reliable energy production, 

 and provide Missouri River management flexibility;

 ``(3) if found feasible, recommendations for a demonstration 

 project to be carried out by the Western Area Power 

 Administration, in partnership with an Indian tribal government 

 or tribal energy resource development organization, and Western 

 Area Power Administration customers to demonstrate the 

 feasibility and potential of using wind energy produced on 

 Indian land to supply firming energy to the Western Area Power 

 Administration; and

 ``(4) an identification of--

 ``(A) the economic and environmental costs of, or 

 benefits to be realized through, a Federal-tribal-

 customer partnership; and

 ``(B) the manner in which a Federal-tribal-customer 

 partnership could contribute to the energy security of 

 the United States.

 ``(d) Funding.--

 ``(1) Authorization of appropriations.--There is authorized 

 to be appropriated to carry out this section $1,000,000, to 

 remain available until expended.

 ``(2) Nonreimbursability.--Costs incurred by the Secretary 

 in carrying out this section shall be nonreimbursable.''.

 (b) Conforming Amendments.--The table of contents for the Energy 

Policy Act of 1992 is amended by striking the items relating to title 

XXVI and inserting the following:

``Sec. 2601. Definitions.

``Sec. 2602. Indian tribal energy resource development.

``Sec. 2603. Indian tribal energy resource regulation.

``Sec. 2604. Leases, business agreements, and rights-of-way involving 

 energy development or transmission.

``Sec. 2605. Federal Power Marketing Administrations.

``Sec. 2606. Wind and hydropower feasibility study.''.

SEC. 504. <<NOTE: 25 USC 3501 note.>> CONSULTATION WITH INDIAN TRIBES.

 In carrying out this title and the amendments made by this title, 

the Secretary and the Secretary of the Interior shall, as appropriate 

and to the maximum extent practicable, involve and consult with Indian 

tribes.

SEC. 505. FOUR CORNERS TRANSMISSION LINE PROJECT AND ELECTRIFICATION.

 (a) Transmission Line Project.--The Dine Power Authority, an 

enterprise of the Navajo Nation, shall be eligible to receive grants and 

other assistance under section 217 of the Department of Energy 

Organization Act, as added by section 502, and section

[[Page 119 STAT. 779]]

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2602 of the Energy Policy Act of 1992, as amended by this Act, for 

activities associated with the development of a transmission line from 

the Four Corners Area to southern Nevada, including related power 

generation opportunities.

 (b) Navajo Electrification.--Section 602 of Public Law 106-511 (114 

Stat. 2376) is amended--

 (1) in subsection (a)--

 (A) in the first sentence, by striking ``5-year'' 

 and inserting ``10-year''; and

 (B) in the third sentence, by striking ``2006'' and 

 inserting ``2011''; and

 (2) in the first sentence of subsection (e) by striking 

 ``2006'' and inserting ``2011''.

SEC. 506. <<NOTE: 42 USC 16001.>> ENERGY EFFICIENCY IN FEDERALLY 

 ASSISTED HOUSING.

 (a) In General.--The Secretary of Housing and Urban Development 

shall promote energy conservation in housing that is located on Indian 

land and assisted with Federal resources through--

 (1) the use of energy-efficient technologies and innovations 

 (including the procurement of energy-efficient refrigerators and 

 other appliances);

 (2) the promotion of shared savings contracts; and

 (3) the use and implementation of such other similar 

 technologies and innovations as the Secretary of Housing and 

 Urban Development considers to be appropriate.

 (b) Amendment.--Section 202(2) of the Native American Housing and 

Self-Determination Act of 1996 (25 U.S.C. 4132(2)) is amended by 

inserting ``improvement to achieve greater energy efficiency,'' after 

``planning,''.

 TITLE VI--NUCLEAR MATTERS

 Subtitle A--Price-Anderson <<NOTE: Price-Anderson Amendments Act of 

2005.>> Act Amendments

SEC. 601. <<NOTE: 42 USC 2011 note.>> SHORT TITLE.

 This subtitle may be cited as the ``Price-Anderson Amendments Act of 

2005''.

SEC. 602. EXTENSION OF INDEMNIFICATION AUTHORITY.

 (a) Indemnification of Nuclear Regulatory Commission Licensees.--

Section 170 c. of the Atomic Energy Act of 1954 (42 U.S.C. 2210(c)) is 

amended--

 (1) in the subsection heading, by striking ``Licenses'' and 

 inserting ``Licensees''; and

 (2) by striking ``December 31, 2003'' each place it appears 

 and inserting ``December 31, 2025''.

 (b) Indemnification of Department Contractors.--Section 170 d.(1)(A) 

of the Atomic Energy Act of 1954 (42 U.S.C. 2210(d)(1)(A)) is amended by 

striking ``December 31, 2006'' and inserting ``December 31, 2025''.

 (c) Indemnification of Nonprofit Educational Institutions.--Section 

170 k. of the Atomic Energy Act of 1954 (42 U.S.C. 2210(k)) is amended 

by striking ``August 1, 2002'' each place it appears and inserting 

``December 31, 2025''.

[[Page 119 STAT. 780]]

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SEC. 603. MAXIMUM ASSESSMENT.

 Section 170 of the Atomic Energy Act of 1954 (42 U.S.C. 2210) is 

amended--

 (1) in the second proviso of the third sentence of 

 subsection b.(1)--

 (A) by striking ``$63,000,000'' and inserting 

 ``$95,800,000''; and

 (B) by striking ``$10,000,000 in any 1 year'' and 

 inserting ``$15,000,000 in any 1 year (subject to 

 adjustment for inflation under subsection t.)''; and

 (2) in subsection t.(1)--

 (A) by inserting ``total and annual'' after ``amount 

 of the maximum'';

 (B) by striking ``the date of the enactment of the 

 Price-Anderson Amendments Act of 1988'' and inserting 

 ``August 20, 2003''; and

 (C) in subparagraph (A), by striking ``such date of 

 enactment'' and inserting ``August 20, 2003''.

SEC. 604. DEPARTMENT LIABILITY LIMIT.

 (a) Indemnification of Department Contractors.--Section 170 d. of 

the Atomic Energy Act of 1954 (42 U.S.C. 2210(d)) is amended by striking 

paragraph (2) and inserting the following:

 ``(2) In an agreement of indemnification entered into under 

paragraph (1), the Secretary--

 ``(A) may require the contractor to provide and maintain 

 financial protection of such a type and in such amounts as the 

 Secretary shall determine to be appropriate to cover public 

 liability arising out of or in connection with the contractual 

 activity; and

 ``(B) shall indemnify the persons indemnified against such 

 liability above the amount of the financial protection required, 

 in the amount of $10,000,000,000 (subject to adjustment for 

 inflation under subsection t.), in the aggregate, for all 

 persons indemnified in connection with the contract and for each 

 nuclear incident, including such legal costs of the contractor 

 as are approved by the Secretary.''.

 (b) Contract Amendments.--Section 170 d. of the Atomic Energy Act of 

1954 (42 U.S.C. 2210(d)) is further amended by striking paragraph (3) 

and inserting the following--

 ``(3) All agreements of indemnification under which the Department 

of Energy (or its predecessor agencies) may be required to indemnify any 

person under this section shall be deemed to be amended, on the date of 

enactment of the Price-Anderson Amendments Act of 2005, to reflect the 

amount of indemnity for public liability and any applicable financial 

protection required of the contractor under this subsection.''.

 (c) Liability Limit.--Section 170 e.(1)(B) of the Atomic Energy Act 

of 1954 (42 U.S.C. 2210(e)(1)(B)) is amended--

 (1) by striking ``the maximum amount of financial protection 

 required under subsection b. or''; and

 (2) by striking ``paragraph (3) of subsection d., whichever 

 amount is more'' and inserting ``paragraph (2) of subsection 

 d.''.

[[Page 119 STAT. 781]]

SEC. 605. INCIDENTS OUTSIDE THE UNITED STATES.

 (a) Amount of Indemnification.--Section 170 d.(5) of the Atomic 

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Energy Act of 1954 (42 U.S.C. 2210(d)(5)) is amended by striking 

``$100,000,000'' and inserting ``$500,000,000''.

 (b) Liability Limit.--Section 170 e.(4) of the Atomic Energy Act of 

1954 (42 U.S.C. 2210(e)(4)) is amended by striking ``$100,000,000'' and 

inserting ``$500,000,000''.

SEC. 606. REPORTS.

 Section 170 p. of the Atomic Energy Act of 1954 (42 U.S.C. 2210(p)) 

is amended by striking ``August 1, 1998'' and inserting ``December 31, 

2021''.

SEC. 607. INFLATION ADJUSTMENT.

 Section 170 t. of the Atomic Energy Act of 1954 (42 U.S.C. 2210(t)) 

is amended--

 (1) by redesignating paragraph (2) as paragraph (3); and

 (2) by inserting after paragraph (1) the following:

 ``(2) The Secretary shall adjust the amount of indemnification 

provided under an agreement of indemnification under subsection d. not 

less than once during each 5-year period following July 1, 2003, in 

accordance with the aggregate percentage change in the Consumer Price 

Index since--

 ``(A) that date, in the case of the first adjustment under 

 this paragraph; or

 ``(B) the previous adjustment under this paragraph.''.

SEC. 608. TREATMENT OF MODULAR REACTORS.

 Section 170 b. of the Atomic Energy Act of 1954 (42 U.S.C. 2210(b)) 

is amended by adding at the end the following:

 ``(5)(A) For purposes of this section only, the Commission shall 

consider a combination of facilities described in subparagraph (B) to be 

a single facility having a rated capacity of 100,000 electrical 

kilowatts or more.

 ``(B) A combination of facilities referred to in subparagraph (A) is 

two or more facilities located at a single site, each of which has a 

rated capacity of 100,000 electrical kilowatts or more but not more than 

300,000 electrical kilowatts, with a combined rated capacity of not more 

than 1,300,000 electrical kilowatts.''.

SEC. 609. <<NOTE: 42 USC 2210 note.>> APPLICABILITY.

 The amendments made by sections 603, 604, and 605 do not apply to a 

nuclear incident that occurs before the date of the enactment of this 

Act.

SEC. 610. CIVIL PENALTIES.

 (a) Repeal of Automatic Remission.--Section 234A b.(2) of the Atomic 

Energy Act of 1954 (42 U.S.C. 2282a(b)(2)) is amended by striking the 

last sentence.

 (b) Limitation for Not-for-Profit Institutions.--Subsection d. of 

section 234A of the Atomic Energy Act of 1954 (42 U.S.C. 2282a(d)) is 

amended to read as follows:

 ``d.(1) Notwithstanding subsection a., in the case of any not-forprofit contractor, subcontractor, or supplier, the total amount of civil 

penalties paid under subsection a. may not exceed the total amount of 

fees paid within any 1-year period (as determined by the Secretary) 

under the contract under which the violation occurs.

[[Page 119 STAT. 782]]

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 ``(2) For purposes of this section, the term `not-for-profit' means 

that no part of the net earnings of the contractor, subcontractor, or 

supplier inures to the benefit of any natural person or for-profit 

artificial person.''.

 (c) Effective Date.--The <<NOTE: 42 USC 2282a note.>> amendments 

made by this section shall not apply to any violation of the Atomic 

Energy Act of 1954 (42 U.S.C. 2011 et seq.) occurring under a contract 

entered into before the date of enactment of this section.

 Subtitle B--General Nuclear Matters

SEC. 621. LICENSES.

 Section 103 c. of the Atomic Energy Act of 1954 (42 U.S.C. 2133(c)) 

is amended by inserting ``from the authorization to commence 

operations'' after ``forty years''.

SEC. 622. NUCLEAR REGULATORY COMMISSION SCHOLARSHIP AND FELLOWSHIP 

 PROGRAM.

 (a) In General.--Chapter 19 of the Atomic Energy Act of 1954 is 

amended by inserting after section 242 (42 U.S.C. 2015a) the following:

``SEC. 243. <<NOTE: 42 USC 2015b.>> SCHOLARSHIP AND FELLOWSHIP PROGRAM.

 ``a. Scholarship Program.--To enable students to study, for at least 

1 academic semester or equivalent term, science, engineering, or another 

field of study that the Commission determines is in a critical skill 

area related to the regulatory mission of the Commission, the Commission 

may carry out a program to--

 ``(1) award scholarships to undergraduate students who--

 ``(A) are United States citizens; and

 ``(B) enter into an agreement under subsection c. to 

 be employed by the Commission in the area of study for 

 which the scholarship is awarded.

 ``b. Fellowship Program.--To enable students to pursue education in 

science, engineering, or another field of study that the Commission 

determines is in a critical skill area related to its regulatory 

mission, in a graduate or professional degree program offered by an 

institution of higher education in the United States, the Commission may 

carry out a program to--

 ``(1) award fellowships to graduate students who--

 ``(A) are United States citizens; and

 ``(B) enter into an agreement under subsection c. to 

 be employed by the Commission in the area of study for 

 which the fellowship is awarded.

 ``c. Requirements.--

 ``(1) In general.--As a condition of receiving a scholarship 

 or fellowship under subsection a. or b., a recipient of the 

 scholarship or fellowship shall enter into an agreement with the 

 Commission under which, in return for the assistance, the 

 recipient shall--

 ``(A) maintain satisfactory academic progress in the 

 studies of the recipient, as determined by criteria 

 established by the Commission;

 ``(B) agree that failure to maintain satisfactory 

 academic progress shall constitute grounds on which the 

 Commission may terminate the assistance;

[[Page 119 STAT. 783]]

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 ``(C) on completion of the academic course of study 

 in connection with which the assistance was provided, 

 and in accordance with criteria established by the 

 Commission, engage in employment by the Commission for a 

 period specified by the Commission, that shall be not 

 less than 1 time and not more than 3 times the period 

 for which the assistance was provided; and

 ``(D) if the recipient fails to meet the 

 requirements of subparagraph (A), (B), or (C), reimburse 

 the United States Government for--

 ``(i) the entire amount of the assistance 

 provided the recipient under the scholarship or 

 fellowship; and

 ``(ii) interest at a rate determined by the 

 Commission.

 ``(2) Waiver or suspension.--The Commission may establish 

 criteria for the partial or total waiver or suspension of any 

 obligation of service or payment incurred by a recipient of a 

 scholarship or fellowship under this section.

 ``d. Competitive Process.--Recipients of scholarships or fellowships 

under this section shall be selected through a competitive process 

primarily on the basis of academic merit and such other criteria as the 

Commission may establish, with consideration given to financial need and 

the goal of promoting the participation of individuals identified in 

section 33 or 34 of the Science and Engineering Equal Opportunities Act 

(42 U.S.C. 1885a, 1885b).

 ``e. Direct Appointment.--The Commission may appoint directly, with 

no further competition, public notice, or consideration of any other 

potential candidate, an individual who has--

 ``(1) received a scholarship or fellowship awarded by the 

 Commission under this section; and

 ``(2) completed the academic program for which the 

 scholarship or fellowship was awarded.''.

 (b) Conforming Amendment.--The table of sections of the Atomic 

Energy Act of 1954 (42 U.S.C. prec. 2011) is amended by adding after the 

item relating to section 242 the following:

``Sec. 243. Scholarship and fellowship program.''.

SEC. 623. COST RECOVERY FROM GOVERNMENT AGENCIES.

 Section 161 w. of the Atomic Energy Act of 1954 (42 U.S.C. 2201(w)) 

is amended--

 (1) by striking ``for or is issued'' and all that follows 

 through ``1702'' and inserting ``to the Commission for, or is 

 issued by the Commission, a license or certificate'';

 (2) by striking ``483a'' and inserting ``9701''; and

 (3) by striking ``, of applicants for, or holders of, such 

 licenses or certificates''.

SEC. 624. ELIMINATION OF PENSION OFFSET FOR CERTAIN REHIRED FEDERAL 

 RETIREES.

 (a) In General.--Chapter 14 of the Atomic Energy Act of 1954 (42 

U.S.C. 2201 et seq.) is amended by adding at the end the following:

[[Page 119 STAT. 784]]

``SEC. 170C. <<NOTE: 42 USC 2210c.>> ELIMINATION OF PENSION OFFSET FOR 

 CERTAIN REHIRED FEDERAL RETIREES.

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 ``a. In General.--The Commission may waive the application of 

section 8344 or 8468 of title 5, United States Code, on a case-by-case 

basis for employment of an annuitant--

 ``(1) in a position of the Commission for which there is 

 exceptional difficulty in recruiting or retaining a qualified 

 employee; or

 ``(2) when a temporary emergency hiring need exists.

 ``b. Procedures.--The Commission shall prescribe procedures for the 

exercise of authority under this section, including--

 ``(1) criteria for any exercise of authority; and

 ``(2) procedures for a delegation of authority.

 ``c. Effect of Waiver.--An employee as to whom a waiver under this 

section is in effect shall not be considered an employee for purposes of 

subchapter II of chapter 83, or chapter 84, of title 5, United States 

Code.''.

 (b) Conforming Amendment.--The table of sections of the Atomic 

Energy Act of 1954 (42 U.S.C. prec. 2011) is amended by adding at the 

end of the items relating to chapter 14 the following:

``Sec. 170C. Elimination of pension offset for certain rehired Federal 

 retirees.''.

SEC. 625. ANTITRUST REVIEW.

 Section 105 c. of the Atomic Energy Act of 1954 (42 U.S.C. 2135(c)) 

is amended by adding at the end the following:

 ``(9) Applicability.--This subsection does not apply to an 

application for a license to construct or operate a utilization facility 

or production facility under section 103 or 104 b. that is filed on or 

after the date of enactment of this paragraph.''.

SEC. 626. DECOMMISSIONING.

 Section 161 i. of the Atomic Energy Act of 1954 (42 U.S.C. 2201(i)) 

is amended--

 (1) by striking ``and (3)'' and inserting ``(3)''; and

 (2) by inserting before the semicolon at the end the 

 following: ``, and (4) to ensure that sufficient funds will be 

 available for the decommissioning of any production or 

 utilization facility licensed under section 103 or 104 b., 

 including standards and restrictions governing the control, 

 maintenance, use, and disbursement by any former licensee under 

 this Act that has control over any fund for the decommissioning 

 of the facility''.

SEC. 627. LIMITATION ON LEGAL FEE REIMBURSEMENT.

 Title II of the Energy Reorganization Act of 1974 (42 U.S.C. 5841 et 

seq.) is amended by adding at the end the following new section:

 ``limitation on legal fee reimbursement

 ``Sec. 212. <<NOTE: 42 USC 5853.>> The Department of Energy shall 

not, except as required under a contract entered into before the date of 

enactment of this section, reimburse any contractor or subcontractor of 

the Department for any legal fees or expenses incurred with respect to a 

complaint subsequent to--

 ``(1) an adverse determination on the merits with respect to 

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 such complaint against the contractor or subcontractor by the 

 Director of the Department of Energy's Office of Hearings

[[Page 119 STAT. 785]]

 and Appeals pursuant to part 708 of title 10, Code of Federal 

 Regulations, or by a Department of Labor Administrative Law 

 Judge pursuant to section 211 of this Act; or

 ``(2) an adverse final judgment by any State or Federal 

 court with respect to such complaint against the contractor or 

 subcontractor for wrongful termination or retaliation due to the 

 making of disclosures protected under chapter 12 of title 5, 

 United States Code, section 211 of this Act, or any comparable 

 State law,

unless the adverse determination or final judgment is reversed upon 

further administrative or judicial review.''.

SEC. 628. DECOMMISSIONING PILOT PROGRAM.

 (a) Pilot Program.--The Secretary shall establish a decommissioning 

pilot program under which the Secretary shall decommission and 

decontaminate the sodium-cooled fast breeder experimental test-site 

reactor located in northwest Arkansas, in accordance with the 

decommissioning activities contained in the report of the Department 

relating to the reactor, dated August 31, 1998.

 (b) Authorization of Appropriations.--There is authorized to be 

appropriated to the Secretary to carry out this section $16,000,000.

SEC. 629. WHISTLEBLOWER PROTECTION.

 (a) Definition of Employer.--Section 211(a)(2) of the Energy 

Reorganization Act of 1974 (42 U.S.C. 5851(a)(2)) is amended--

 (1) in subparagraph (C), by striking ``and'' at the end;

 (2) in subparagraph (D), by striking the period at the end 

 and inserting a semicolon; and

 (3) by adding at the end the following:

 ``(E) a contractor or subcontractor of the 

 Commission;

 ``(F) the Commission; and

 ``(G) the Department of Energy.''.

 (b) De Novo Review.--Subsection (b) of such section 211 is amended 

by adding at the end the following new paragraph:

 ``(4) <<NOTE: Deadline.>> If the Secretary has not issued a 

 final decision within 1 year after the filing of a complaint 

 under paragraph (1), and there is no showing that such delay is 

 due to the bad faith of the person seeking relief under this 

 paragraph, such person may bring an action at law or equity for 

 de novo review in the appropriate district court of the United 

 States, which shall have jurisdiction over such an action 

 without regard to the amount in controversy.''.

SEC. 630. MEDICAL ISOTOPE PRODUCTION.

 Section 134 of the Atomic Energy Act of 1954 (42 U.S.C. 2160d) is 

amended--

 (1) in subsection a., by striking ``a. The Commission'' and 

 inserting ``a. In General.--Except as provided in subsection b., 

 the Commission'';

 (2) by redesignating subsection b. as subsection c.; and

 (3) by inserting after subsection a. the following:

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 ``b. Medical Isotope Production.--

 ``(1) Definitions.--In this subsection:

 ``(A) Highly enriched uranium.--The term `highly 

 enriched uranium' means uranium enriched to include 

 concentration of U-235 above 20 percent.

[[Page 119 STAT. 786]]

 ``(B) Medical isotope.--The term `medical isotope' 

 includes Molybdenum 99, Iodine 131, Xenon 133, and other 

 radioactive materials used to produce a 

 radiopharmaceutical for diagnostic, therapeutic 

 procedures or for research and development.

 ``(C) Radiopharmaceutical.--The term 

 `radiopharmaceutical' means a radioactive isotope that--

 ``(i) contains byproduct material combined 

 with chemical or biological material; and

 ``(ii) is designed to accumulate temporarily 

 in a part of the body for therapeutic purposes or 

 for enabling the production of a useful image for 

 use in a diagnosis of a medical condition.

 ``(D) Recipient country.--The term `recipient 

 country' means Canada, Belgium, France, Germany, and the 

 Netherlands.

 ``(2) Licenses.--The Commission may issue a license 

 authorizing the export (including shipment to and use at 

 intermediate and ultimate consignees specified in the license) 

 to a recipient country of highly enriched uranium for medical 

 isotope production if, in addition to any other requirements of 

 this Act (except subsection a.), the Commission determines 

 that--

 ``(A) a recipient country that supplies an assurance 

 letter to the United States Government in connection 

 with the consideration by the Commission of the export 

 license application has informed the United States 

 Government that any intermediate consignees and the 

 ultimate consignee specified in the application are 

 required to use the highly enriched uranium solely to 

 produce medical isotopes; and

 ``(B) the highly enriched uranium for medical 

 isotope production will be irradiated only in a reactor 

 in a recipient country that--

 ``(i) uses an alternative nuclear reactor 

 fuel; or

 ``(ii) is the subject of an agreement with the 

 United States Government to convert to an 

 alternative nuclear reactor fuel when alternative 

 nuclear reactor fuel can be used in the reactor.

 ``(3) Review of physical protection requirements.--

 ``(A) In general.--The Commission shall review the 

 adequacy of physical protection requirements that, as of 

 the date of an application under paragraph (2), are 

 applicable to the transportation and storage of highly 

 enriched uranium for medical isotope production or 

 control of residual material after irradiation and 

 extraction of medical isotopes.

 ``(B) Imposition of additional requirements.--If the 

 Commission determines that additional physical 

 protection requirements are necessary (including a limit 

 on the quantity of highly enriched uranium that may be 

 contained in a single shipment), the Commission shall 

 impose such requirements as license conditions or 

 through other appropriate means.

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 ``(4) First report to congress.--

[[Page 119 STAT. 787]]

 ``(A) NAS study.--The <<NOTE: Contracts.>> Secretary 

 shall enter into an arrangement with the National 

 Academy of Sciences to conduct a study to determine--

 ``(i) the feasibility of procuring supplies of 

 medical isotopes from commercial sources that do 

 not use highly enriched uranium;

 ``(ii) the current and projected demand and 

 availability of medical isotopes in regular 

 current domestic use;

 ``(iii) the progress that is being made by the 

 Department of Energy and others to eliminate all 

 use of highly enriched uranium in reactor fuel, 

 reactor targets, and medical isotope production 

 facilities; and

 ``(iv) the potential cost differential in 

 medical isotope production in the reactors and 

 target processing facilities if the products were 

 derived from production systems that do not 

 involve fuels and targets with highly enriched 

 uranium.

 ``(B) Feasibility.--For the purpose of this 

 subsection, the use of low enriched uranium to produce 

 medical isotopes shall be determined to be feasible if--

 ``(i) low enriched uranium targets have been 

 developed and demonstrated for use in the reactors 

 and target processing facilities that produce 

 significant quantities of medical isotopes to 

 serve United States needs for such isotopes;

 ``(ii) sufficient quantities of medical 

 isotopes are available from low enriched uranium 

 targets and fuel to meet United States domestic 

 needs; and

 ``(iii) the average anticipated total cost 

 increase from production of medical isotopes in 

 such facilities without use of highly enriched 

 uranium is less than 10 percent.

 ``(C) Report by the secretary.--Not later than 5 

 years after the date of enactment of the Energy Policy 

 Act of 2005, the Secretary shall submit to Congress a 

 report that--

 ``(i) contains the findings of the National 

 Academy of Sciences made in the study under 

 subparagraph (A); and

 ``(ii) discloses the existence of any 

 commitments from commercial producers to provide 

 domestic requirements for medical isotopes without 

 use of highly enriched uranium consistent with the 

 feasibility criteria described in subparagraph (B) 

 not later than the date that is 4 years after the 

 date of submission of the report.

 ``(5) Second report to congress.--If the study of the 

 National Academy of Sciences determines under paragraph 

 (4)(A)(i) that the procurement of supplies of medical isotopes 

 from commercial sources that do not use highly enriched uranium 

 is feasible, but the Secretary is unable to report the existence 

 of commitments under paragraph (4)(C)(ii), not later than the 

 date that is 6 years after the date of enactment of the Energy 

 Policy Act of 2005, the Secretary shall submit to Congress a 

 report that describes options for developing domestic supplies 

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 of medical isotopes in quantities that are

[[Page 119 STAT. 788]]

 adequate to meet domestic demand without the use of highly 

 enriched uranium consistent with the cost increase described in 

 paragraph (4)(B)(iii).

 ``(6) Certification.--At such time as commercial facilities 

 that do not use highly enriched uranium are capable of meeting 

 domestic requirements for medical isotopes, within the cost 

 increase described in paragraph (4)(B)(iii) and without 

 impairing the reliable supply of medical isotopes for domestic 

 utilization, the Secretary shall submit to Congress a 

 certification to that effect.

 ``(7) Sunset provision.--After the Secretary submits a 

 certification under paragraph (6), the Commission shall, by 

 rule, terminate its review of export license applications under 

 this subsection.''.

SEC. 631. SAFE DISPOSAL OF GREATER-THAN-CLASS C RADIOACTIVE WASTE.

 (a) Responsibility for <<NOTE: Notification.>> Activities To Provide 

Storage Facility.--The Secretary shall provide to Congress official 

notification of the final designation of an entity within the Department 

to have the responsibility of completing activities needed to provide a 

facility for safely disposing of all greater-than-Class C low-level 

radioactive waste.

 (b) Reports and Plans.--

 (1) Report on permanent disposal facility.--

 (A) Plan regarding cost and schedule for completion 

 of eis and rod.--Not later than 1 year after the date of 

 enactment of this Act, the Secretary, in consultation 

 with Congress, shall submit to Congress a report 

 containing an estimate of the cost and a proposed 

 schedule to complete an environmental impact statement 

 and record of decision for a permanent disposal facility 

 for greater-than-Class C radioactive waste.

 (B) Analysis of alternatives.--Before the Secretary 

 makes a final decision on the disposal alternative or 

 alternatives to be implemented, the Secretary shall--

 (i) submit to Congress a report that describes 

 all alternatives under consideration, including 

 all information required in the comprehensive 

 report making recommendations for ensuring the 

 safe disposal of all greater-than-Class C low-

 level radioactive waste that was submitted by the 

 Secretary to Congress in February 1987; and

 (ii) await action by Congress.

 (2) Short-term plan for recovery and storage.--

 (A) In general.--Not <<NOTE: Deadline.>> later than 

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

 Secretary shall submit to Congress a plan to ensure the 

 continued recovery and storage of greater-than-Class C 

 low-level radioactive sealed sources that pose a 

 security threat until a permanent disposal facility is 

 available.

 (B) Contents.--The plan shall address estimated 

 cost, resource, and facility needs.

SEC. 632. PROHIBITION ON NUCLEAR EXPORTS TO COUNTRIES THAT SPONSOR 

 TERRORISM.

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 (a) In General.--Section 129 of the Atomic Energy Act of 1954 (42 

U.S.C. 2158) is amended--

[[Page 119 STAT. 789]]

 (1) by inserting ``a.'' before ``No nuclear materials and 

 equipment''; and

 (2) by adding at the end the following new subsection:

 ``b.(1) Notwithstanding any other provision of law, including 

specifically section 121 of this Act, and except as provided in 

paragraphs (2) and (3), no nuclear materials and equipment or sensitive 

nuclear technology, including items and assistance authorized by section 

57 b. of this Act and regulated under part 810 of title 10, Code of 

Federal Regulations, and nuclear-related items on the Commerce Control 

List maintained under part 774 of title 15 of the Code of Federal 

Regulations, shall be exported or reexported, or transferred or 

retransferred whether directly or indirectly, and no Federal agency 

shall issue any license, approval, or authorization for the export or 

reexport, or transfer, or retransfer, whether directly or indirectly, of 

these items or assistance (as defined in this paragraph) to any country 

whose government has been identified by the Secretary of State as 

engaged in state sponsorship of terrorist activities (specifically 

including any country the government of which has been determined by the 

Secretary of State under section 620A(a) of the Foreign Assistance Act 

of 1961 (22 U.S.C. 2371(a)), section 6(j)(1) of the Export 

Administration Act of 1979 (50 U.S.C. App. 2405(j)(1)), or section 40(d) 

of the Arms Export Control Act (22 U.S.C. 2780(d)) to have repeatedly 

provided support for acts of international terrorism).

 ``(2) This subsection shall not apply to exports, reexports, 

transfers, or retransfers of radiation monitoring technologies, 

surveillance equipment, seals, cameras, tamper-indication devices, 

nuclear detectors, monitoring systems, or equipment necessary to safely 

store, transport, or remove hazardous materials, whether such items, 

services, or information are regulated by the Department of Energy, the 

Department of Commerce, or the Commission, except to the extent that 

such technologies, equipment, seals, cameras, devices, detectors, or 

systems are available for use in the design or construction of nuclear 

reactors or nuclear weapons.

 ``(3) The President may waive the application of paragraph (1) to a 

country if the President determines and certifies to Congress that the 

waiver will not result in any increased risk that the country receiving 

the waiver will acquire nuclear weapons, nuclear reactors, or any 

materials or components of nuclear weapons and--

 ``(A) the government of such country has not within the 

 preceding 12-month period willfully aided or abetted the 

 international proliferation of nuclear explosive devices to 

 individuals or groups or willfully aided and abetted an 

 individual or groups in acquiring unsafeguarded nuclear 

 materials;

 ``(B) in the judgment of the President, the government of 

 such country has provided adequate, verifiable assurances that 

 it will cease its support for acts of international terrorism;

 ``(C) the waiver of that paragraph is in the vital national 

 security interest of the United States; or

 ``(D) such a waiver is essential to prevent or respond to a 

 serious radiological hazard in the country receiving the waiver 

 that may or does threaten public health and safety.''.

 (b) Applicability to <<NOTE: 42 USC 2158 note.>> Exports Approved 

for Transfer but Not Transferred.--Subsection b. of section 129 of 

Atomic Energy Act of 1954, as added by subsection (a) of this section, 

shall apply with respect to exports that have been approved for transfer 

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as

[[Page 119 STAT. 790]]

of the date of the enactment of this Act but have not yet been 

transferred as of that date.

SEC. 633. EMPLOYEE BENEFITS.

 Section 3110(a) of the USEC Privatization Act (42 U.S.C. 2297h-8(a)) 

is amended by adding at the end the following new paragraph:

 ``(8) Continuity of benefits.--

To <<NOTE: Deadline. Ohio. Kentucky.>> the extent appropriations are 

provided in advance for this purpose or are otherwise available, not 

later than 30 days after the date of enactment of this paragraph, the 

Secretary shall implement such actions as are necessary to ensure that 

any employee who--

 ``(A) is involved in providing infrastructure or 

 environmental remediation services at the Portsmouth, Ohio, or 

 the Paducah, Kentucky, Gaseous Diffusion Plant;

 ``(B) has been an employee of the Department of Energy's 

 predecessor management and integrating contractor (or its first 

 or second tier subcontractors), or of the Corporation, at the 

 Portsmouth, Ohio, or the Paducah, Kentucky, facility; and

 ``(C) was eligible as of April 1, 2005, to participate in or 

 transfer into the Multiple Employer Pension Plan or the 

 associated multiple employer retiree health care benefit plans, 

 as defined in those plans,

shall continue to be eligible to participate in or transfer into such 

pension or health care benefit plans.''.

SEC. 634. <<NOTE: 42 USC 16011.>> DEMONSTRATION HYDROGEN PRODUCTION AT 

 EXISTING NUCLEAR POWER PLANTS.

 (a) Demonstration Projects.--The Secretary shall provide for the 

establishment of 2 projects in geographic areas that are regionally and 

climatically diverse to demonstrate the commercial production of 

hydrogen at existing nuclear power plants.

 (b) Economic Analysis.--Prior to making an award under subsection 

(a), the Secretary shall determine whether the use of existing nuclear 

power plants is a cost-effective means of producing hydrogen.

 (c) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary for the purposes of carrying out this 

section not more than $100,000,000.

SEC. 635. <<NOTE: 42 USC 16012.>> PROHIBITION ON ASSUMPTION BY UNITED 

 STATES GOVERNMENT OF LIABILITY FOR CERTAIN FOREIGN 

 INCIDENTS.

 (a) In General.--Notwithstanding any other provision of law, no 

officer of the United States or of any department, agency, or 

instrumentality of the United States Government may enter into any 

contract or other arrangement, or into any amendment or modification of 

a contract or other arrangement, the purpose or effect of which would be 

to directly or indirectly impose liability on the United States 

Government, or any department, agency, or instrumentality of the United 

States Government, or to otherwise directly or indirectly require an 

indemnity by the United States Government, for nuclear incidents 

occurring in connection with the design, construction, or operation of a 

production facility or utilization facility in any country whose 

government has been identified by the Secretary of State as engaged in 

state sponsorship of terrorist activities (specifically including any 

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country the government of which, as of September 11, 2001, had been 

determined by the Secretary of State under section 620A(a) of the 

Foreign

[[Page 119 STAT. 791]]

Assistance Act of 1961 (22 U.S.C. 2371(a)), section 6(j)(1) of the 

Export Administration Act of 1979 (50 U.S.C. App. 2405(j)(1)), or 

section 40(d) of the Arms Export Control Act (22 U.S.C. 2780(d)) to have 

repeatedly provided support for acts of international terrorism). This 

section shall not apply to nuclear incidents occurring as a result of 

missions, carried out under the direction of the Secretary, the 

Secretary of Defense, or the Secretary of State, that are necessary to 

safely secure, store, transport, or remove nuclear materials for nuclear 

safety or nonproliferation purposes.

 (b) Definitions.--The terms used in this section shall have the same 

meaning as those terms have under section 11 of the Atomic Energy Act of 

1954 (42 U.S.C. 2014), unless otherwise expressly provided in this 

section.

SEC. 636. <<NOTE: 42 USC 16013.>> AUTHORIZATION OF APPROPRIATIONS.

 There are authorized to be appropriated such sums as are necessary 

to carry out this subtitle and the amendments made by this subtitle.

SEC. 637. NUCLEAR REGULATORY COMMISSION USER FEES AND ANNUAL CHARGES.

 (a) In General.--Section 6101 of the Omnibus Budget Reconciliation 

Act of 1990 (42 U.S.C. 2214) is amended--

 (1) in subsection (a)--

 (A) by striking ``Except as provided in paragraph 

 (3), the'' and inserting ``The'' in paragraph (1); and

 (B) by striking paragraph (3); and

 (2) in subsection (c)--

 (A) by striking ``and'' at the end of paragraph 

 (2)(A)(i);

 (B) by striking the period at the end of paragraph 

 (2)(A)(ii) and inserting a semicolon;

 (C) by adding at the end of paragraph (2)(A) the 

 following new clauses:

 ``(iii) amounts appropriated to the Commission 

 for the fiscal year for implementation of section 

 3116 of the Ronald W. Reagan National Defense 

 Authorization Act for Fiscal Year 2005; and

 ``(iv) amounts appropriated to the Commission 

 for homeland security activities of the Commission 

 for the fiscal year, except for the costs of 

 fingerprinting and background checks required by 

 section 149 of the Atomic Energy Act of 1954 (42 

 U.S.C. 2169) and the costs of conducting security 

 inspections.''; and

 (D) by amending paragraph (2)(B)(v) to read as 

 follows:

 ``(v) 90 percent for fiscal year 2005 and each 

 fiscal year thereafter.''.

 (b) Repeal.--Section 7601 of the Consolidated Omnibus Budget 

Reconciliation Act of 1985 (42 U.S.C. 2213) is repealed.

 (c) Effective Date.--The <<NOTE: 42 USC 2214 note.>> amendments made 

by this section take effect on October 1, 2006.

SEC. 638. <<NOTE: 42 USC 16014.>> STANDBY SUPPORT FOR CERTAIN NUCLEAR 

 PLANT DELAYS.

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 (a) Definitions.--In this section:

 (1) Advanced nuclear facility.--The term ``advanced nuclear 

 facility'' means any nuclear facility the reactor design for 

 which is approved after December 31, 1993, by the Commission 

 (and such design or a substantially similar design of comparable 

 capacity was not approved on or before that date).

[[Page 119 STAT. 792]]

 (2) Combined license.--The term ``combined license'' means a 

 combined construction and operating license for an advanced 

 nuclear facility issued by the Commission.

 (3) Commission.--The term ``Commission'' means the Nuclear 

 Regulatory Commission.

 (4) Sponsor.--The term ``sponsor'' means a person who has 

 applied for or been granted a combined license.

 (b) Contract Authority.--

 (1) In general.--The Secretary may enter into contracts 

 under this section with sponsors of an advanced nuclear facility 

 that cover a total of 6 reactors, with the 6 reactors consisting 

 of not more than 3 different reactor designs, in accordance with 

 paragraph (2).

 (2) Requirement for contracts.--

 (A) Definition of loan cost.--In this paragraph, the 

 term ``loan cost'' has the meaning given the term ``cost 

 of a loan guarantee'' under section 502(5)(C) of the 

 Federal Credit Reform Act of 1990 (2 U.S.C. 661a(5)(C)).

 (B) Establishment of accounts.--There is established 

 in the Department 2 separate accounts, which shall be 

 known as the--

 (i) ``Standby Support Program Account''; and

 (ii) ``Standby Support Grant Account''.

 (C) Requirement.--The Secretary shall not enter into 

 a contract under this section unless the Secretary 

 deposits--

 (i) in the Standby Support Program Account 

 established under subparagraph (B), funds 

 appropriated to the Secretary in advance of the 

 contract or a combination of appropriated funds 

 and loan guarantee fees that are in an amount 

 sufficient to cover the loan costs described in 

 subsection (d)(5)(A); and

 (ii) in the Standby Support Grant Account 

 established under subparagraph (B), funds 

 appropriated to the Secretary in advance of the 

 contract, paid to the Secretary by the sponsor of 

 the advanced nuclear facility, or a combination of 

 appropriations and payments that are in an amount 

 sufficient cover the costs described in 

 subparagraphs (B), (C), and (D) of subsection 

 (d)(5).

 (c) Covered Delays.--

 (1) Inclusions.--Under each contract authorized by this 

 section, the Secretary shall pay the costs specified in 

 subsection (d), using funds appropriated or collected for the 

 covered costs, if full power operation of the advanced nuclear 

 facility is delayed by--

 (A) the failure of the Commission to comply with 

 schedules for review and approval of inspections, tests, 

 analyses, and acceptance criteria established under the 

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 combined license or the conduct of preoperational 

 hearings by the Commission for the advanced nuclear 

 facility; or

 (B) litigation that delays the commencement of full-

 power operations of the advanced nuclear facility.

 (2) Exclusions.--The Secretary may not enter into any 

 contract under this section that would obligate the Secretary to 

 pay any costs resulting from--

[[Page 119 STAT. 793]]

 (A) the failure of the sponsor to take any action 

 required by law or regulation;

 (B) events within the control of the sponsor; or

 (C) normal business risks.

 (d) Covered Costs.--

 (1) In general.--Subject to paragraphs (2), (3), and (4), 

 the costs that shall be paid by the Secretary pursuant to a 

 contract entered into under this section are the costs that 

 result from a delay covered by the contract.

 (2) Initial 2 reactors.--In the case of the first 2 reactors 

 that receive combined licenses and on which construction is 

 commenced, the Secretary shall pay--

 (A) 100 percent of the covered costs of delay; but

 (B) not more than $500,000,000 per contract.

 (3) Subsequent 4 reactors.--In the case of the next 4 

 reactors that receive a combined license and on which 

 construction is commenced, the Secretary shall pay--

 (A) 50 percent of the covered costs of delay that 

 occur after the initial 180-day period of covered delay; 

 but

 (B) not more than $250,000,000 per contract.

 (4) Conditions on payment of certain covered costs.--

 (A) In general.--The obligation of the Secretary to 

 pay the covered costs described in subparagraph (B) of 

 paragraph (5) is subject to the Secretary receiving from 

 appropriations or payments from other non-Federal 

 sources amounts sufficient to pay the covered costs.

 (B) Non-federal sources.--The Secretary may receive 

 and accept payments from any non-Federal source, which 

 shall be made available without further appropriation 

 for the payment of the covered costs.

 (5) Types of covered costs.--Subject to paragraphs (2), (3), 

 and (4), the contract entered into under this section for an 

 advanced nuclear facility shall include as covered costs those 

 costs that result from a delay during construction and in 

 gaining approval for fuel loading and full-power operation, 

 including--

 (A) principal or interest on any debt obligation of 

 an advanced nuclear facility owned by a non-Federal 

 entity; and

 (B) the incremental difference between--

 (i) the fair market price of power purchased 

 to meet the contractual supply agreements that 

 would have been met by the advanced nuclear 

 facility but for the delay; and

 (ii) the contractual price of power from the 

 advanced nuclear facility subject to the delay.

 (e) Requirements.--Any contract between a sponsor and the Secretary 

covering an advanced nuclear facility under this section shall require 

the sponsor to use due diligence to shorten, and to end, the delay 

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covered by the contract.

 (f) Reports.--For each advanced nuclear facility that is covered by 

a contract under this section, the Commission shall submit to Congress 

and the Secretary quarterly reports summarizing the status of licensing 

actions associated with the advanced nuclear facility.

 (g) Regulations.--

[[Page 119 STAT. 794]]

 (1) In general.--Subject to paragraphs (2) and (3), the 

 Secretary shall issue such regulations as are necessary to carry 

 out this section.

 (2) Interim final rulemaking.--Not <<NOTE: Deadline. Public 

 information.>> later than 270 days after the date of enactment 

 of this Act, the Secretary shall issue for public comment an 

 interim final rule regulating contracts authorized by this 

 section.

 (3) Notice of final rulemaking.--

 Not <<NOTE: Deadline.>> later than 1 year after the date of 

 enactment of this Act, the Secretary shall issue a notice of 

 final rulemaking regulating the contracts.

 (h) Authorization of Appropriations.--There are authorized to be 

appropriated such sums as are necessary to carry out this section.

SEC. 639. CONFLICTS OF INTEREST RELATING TO CONTRACTS AND OTHER 

 ARRANGEMENTS.

 Section 170A b. of the Atomic Energy Act of 1954 (42 U.S.C. 

2210a(b)) is amended--

 (1) by redesignating paragraphs (1) and (2) as subparagraphs 

 (A) and (B), respectively, and indenting appropriately;

 (2) by striking ``b. The Commission'' and inserting the 

 following:

 ``b. Evaluation.--

 ``(1) In general.--Except as provided in paragraph (2), the 

 Nuclear Regulatory Commission''; and

 (3) by adding at the end the following:

 ``(2) Nuclear regulatory commission.--Notwithstanding any 

 conflict of interest, the Nuclear Regulatory Commission may 

 enter into a contract, agreement, or arrangement with the 

 Department of Energy or the operator of a Department of Energy 

 facility, if the Nuclear Regulatory Commission determines that--

 ``(A) the conflict of interest cannot be mitigated; 

 and

 ``(B) adequate justification exists to proceed 

 without mitigation of the conflict of interest.''.

 Subtitle C--Next Generation Nuclear Plant Project

SEC. 641. <<NOTE: 42 USC 16021.>> PROJECT ESTABLISHMENT.

 (a) Establishment.--The Secretary shall establish a project to be 

known as the ``Next Generation Nuclear Plant Project'' (referred to in 

this subtitle as the ``Project'').

 (b) Content.--The Project shall consist of the research, 

development, design, construction, and operation of a prototype plant, 

including a nuclear reactor that--

 (1) is based on research and development activities 

 supported by the Generation IV Nuclear Energy Systems Initiative 

 under section 942(d); and

 (2) shall be used--

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 (A) to generate electricity;

 (B) to produce hydrogen; or

 (C) both to generate electricity and to produce 

 hydrogen.

[[Page 119 STAT. 795]]

SEC. 642. <<NOTE: 42 USC 16022.>> PROJECT MANAGEMENT.

 (a) Departmental Management.--

 (1) In general.--The Project shall be managed in the 

 Department by the Office of Nuclear Energy, Science, and 

 Technology.

 (2) Generation iv nuclear energy systems program.--The 

 Secretary may combine the Project with the Generation IV Nuclear 

 Energy Systems Initiative.

 (3) Existing doe project management expertise.--The 

 Secretary may utilize capabilities for review of construction 

 projects for advanced scientific facilities within the Office of 

 Science to track the progress of the Project.

 (b) Laboratory Management.--

 (1) Lead laboratory.--The Idaho National Laboratory shall be 

 the lead National Laboratory for the Project and shall 

 collaborate with other National Laboratories, institutions of 

 higher education, other research institutes, industrial 

 researchers, and international researchers to carry out the 

 Project.

 (2) Industrial partnerships.--

 (A) In general.--The Idaho National Laboratory shall 

 organize a consortium of appropriate industrial partners 

 that will carry out cost-shared research, development, 

 design, and construction activities, and operate 

 research facilities, on behalf of the Project.

 (B) Cost-sharing.--Activities of industrial partners 

 funded by the Project shall be cost-shared in accordance 

 with section 988.

 (C) Preference.--Preference in determining the final 

 structure of the consortium or any partnerships under 

 this subtitle shall be given to a structure (including 

 designating as a lead industrial partner an entity 

 incorporated in the United States) that retains United 

 States technological leadership in the Project while 

 maximizing cost sharing opportunities and minimizing 

 Federal funding responsibilities.

 (3) Prototype plant siting.--The prototype nuclear reactor 

 and associated plant shall be sited at the Idaho National 

 Laboratory in Idaho.

 (4) Reactor test capabilities.--The Project shall use, if 

 appropriate, reactor test capabilities at the Idaho National 

 Laboratory.

 (5) Other laboratory capabilities.--The Project may use, if 

 appropriate, facilities at other National Laboratories.

SEC. 643. <<NOTE: 42 USC 16023.>> PROJECT ORGANIZATION.

 (a) Major Project Elements.--The Project shall consist of the 

following major program elements:

 (1) High-temperature hydrogen production technology 

 development and validation.

 (2) Energy conversion technology development and validation.

 (3) Nuclear fuel development, characterization, and 

 qualification.

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 (4) Materials selection, development, testing, and 

 qualification.

[[Page 119 STAT. 796]]

 (5) Reactor and balance-of-plant design, engineering, safety 

 analysis, and qualification.

 (b) Project Phases.--The Project shall be conducted in the following 

phases:

 (1) First project phase.--A first project phase shall be 

 conducted to--

 (A) select and validate the appropriate technology 

 under subsection (a)(1);

 (B) carry out enabling research, development, and 

 demonstration activities on technologies and components 

 under paragraphs (2) through (4) of subsection (a);

 (C) determine whether it is appropriate to combine 

 electricity generation and hydrogen production in a 

 single prototype nuclear reactor and plant; and

 (D) carry out initial design activities for a 

 prototype nuclear reactor and plant, including 

 development of design methods and safety analytical 

 methods and studies under subsection (a)(5).

 (2) Second project phase.--A second project phase shall be 

 conducted to--

 (A) continue appropriate activities under paragraphs 

 (1) through (5) of subsection (a);

 (B) develop, through a competitive process, a final 

 design for the prototype nuclear reactor and plant;

 (C) apply for licenses to construct and operate the 

 prototype nuclear reactor from the Nuclear Regulatory 

 Commission; and

 (D) construct and start up operations of the 

 prototype nuclear reactor and its associated hydrogen or 

 electricity production facilities.

 (c) Project Requirements.--

 (1) In general.--The Secretary shall ensure that the Project 

 is structured so as to maximize the technical interchange and 

 transfer of technologies and ideas into the Project from other 

 sources of relevant expertise, including--

 (A) the nuclear power industry, including nuclear 

 powerplant construction firms, particularly with respect 

 to issues associated with plant design, construction, 

 and operational and safety issues;

 (B) the chemical processing industry, particularly 

 with respect to issues relating to--

 (i) the use of process energy for production 

 of hydrogen; and

 (ii) the integration of technologies developed 

 by the Project into chemical processing 

 environments; and

 (C) international efforts in areas related to the 

 Project, particularly with respect to hydrogen 

 production technologies.

 (2) International collaboration.--

 (A) In general.--The Secretary shall seek 

 international cooperation, participation, and financial 

 contributions for the Project.

 (B) Assistance from international partners.--The 

 Secretary, through the Idaho National Laboratory, may 

 contract for assistance from specialists or facilities 

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 from member countries of the Generation IV International

[[Page 119 STAT. 797]]

 Forum, the Russian Federation, or other international 

 partners if the specialists or facilities provide access 

 to cost-effective and relevant skills or test 

 capabilities.

 (C) Partner nations.--The Project may involve 

 demonstration of selected project objectives in a 

 partner country.

 (D) Generation iv international forum.--The 

 Secretary shall ensure that international activities of 

 the Project are coordinated with the Generation IV 

 International Forum.

 (3) Review by nuclear energy research advisory committee.--

 (A) In general.--The Nuclear Energy Research 

 Advisory Committee of the Department (referred to in 

 this paragraph as the ``NERAC'') shall--

 (i) review all program plans for the Project 

 and all progress under the Project on an ongoing 

 basis; and

 (ii) ensure that important scientific, 

 technical, safety, and program management issues 

 receive attention in the Project and by the 

 Secretary.

 (B) Additional expertise.--The NERAC shall 

 supplement the expertise of the NERAC or appoint 

 subpanels to incorporate into the review by the NERAC 

 the relevant sources of expertise described under 

 paragraph (1).

 (C) Initial review.--Not <<NOTE: Deadline.>> later 

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

 the NERAC shall--

 (i) review existing program plans for the 

 Project in light of the recommendations of the 

 document entitled ``Design Features and Technology 

 Uncertainties for the Next Generation Nuclear 

 Plant,'' dated June 30, 2004; and

 (ii) address any recommendations of the 

 document not incorporated in program plans for the 

 Project.

 (D) First project phase review.--On a determination 

 by the Secretary that the appropriate activities under 

 the first project phase under subsection (b)(1) are 

 nearly complete, the Secretary shall request the NERAC 

 to conduct a comprehensive review of the Project and to 

 report to the Secretary the recommendation of the NERAC 

 concerning whether the Project is ready to proceed to 

 the second project phase under subsection (b)(2).

 (E) Transmittal of reports to congress.--Not later 

 than 60 days after receiving any report from the NERAC 

 related to the Project, the Secretary shall submit to 

 the appropriate committees of the Senate and the House 

 of Representatives a copy of the report, along with any 

 additional views of the Secretary that the Secretary may 

 consider appropriate.

SEC. 644. <<NOTE: 42 USC 16024.>> NUCLEAR REGULATORY COMMISSION.

 (a) In General.--In accordance with section 202 of the Energy 

Reorganization Act of 1974 (42 U.S.C. 5842), the Nuclear Regulatory 

Commission shall have licensing and regulatory authority for any reactor 

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authorized under this subtitle.

 (b) Licensing Strategy.--Not <<NOTE: Deadline.>> later than 3 years 

after the date of enactment of this Act, the Secretary and the Chairman

[[Page 119 STAT. 798]]

of the Nuclear Regulatory Commission shall jointly submit to the 

appropriate committees of the Senate and the House of Representatives a 

licensing strategy for the prototype nuclear reactor, including--

 (1) a description of ways in which current licensing 

 requirements relating to light-water reactors need to be adapted 

 for the types of prototype nuclear reactor being considered by 

 the Project;

 (2) a description of analytical tools that the Nuclear 

 Regulatory Commission will have to develop to independently 

 verify designs and performance characteristics of components, 

 equipment, systems, or structures associated with the prototype 

 nuclear reactor;

 (3) other research or development activities that may be 

 required on the part of the Nuclear Regulatory Commission in 

 order to review a license application for the prototype nuclear 

 reactor; and

 (4) an estimate of the budgetary requirements associated 

 with the licensing strategy.

 (c) Ongoing Interaction.--The Secretary shall seek the active 

participation of the Nuclear Regulatory Commission throughout the 

duration of the Project to--

 (1) avoid design decisions that will compromise adequate 

 safety margins in the design of the reactor or impair the 

 accessibility of nuclear safety-related components of the 

 prototype reactor for inspection and maintenance;

 (2) develop tools to facilitate inspection and maintenance 

 needed for safety purposes; and

 (3) develop risk-based criteria for any future commercial 

 development of a similar reactor architectures.

SEC. 645. <<NOTE: 42 USC 16025.>> PROJECT TIMELINES AND AUTHORIZATION OF 

 APPROPRIATIONS.

 (a) Target <<NOTE: Deadline.>> Date to Complete the First Project 

Phase.--Not later than September 30, 2011, the Secretary shall--

 (1) select the technology to be used by the Project for 

 high-temperature hydrogen production and the initial design 

 parameters for the prototype nuclear plant; or

 (2) <<NOTE: Reports.>> submit to Congress a report 

 establishing an alternative date for making the selection.

 (b) Design Competition for Second Project Phase.--

 (1) In general.--The Secretary, acting through the Idaho 

 National Laboratory, shall fund not more than 4 teams for not 

 more than 2 years to develop detailed proposals for competitive 

 evaluation and selection of a single proposal for a final design 

 of the prototype nuclear reactor.

 (2) Systems integration.--The Secretary may structure 

 Project activities in the second project phase to use the lead 

 industrial partner of the competitively selected design under 

 paragraph (1) in a systems integration role for final design and 

 construction of the Project.

 (c) Target <<NOTE: Deadline.>> Date to Complete Project 

Construction.--Not later than September 30, 2021, the Secretary shall--

 (1) complete construction and begin operations of the 

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 prototype nuclear reactor and associated energy or hydrogen 

 facilities; or

[[Page 119 STAT. 799]]

 (2) <<NOTE: Reports.>> submit to Congress a report 

 establishing an alternative date for completion.

 (d) Authorization of Appropriations.--There is authorized to be 

appropriated to the Secretary for research and construction activities 

under this subtitle (including for transfer to the Nuclear Regulatory 

Commission for activities under section 644 as appropriate)--

 (1) $1,250,000,000 for the period of fiscal years 2006 

 through 2015; and

 (2) such sums as are necessary for each of fiscal years 2016 

 through 2021.

 Subtitle D--Nuclear Security

SEC. 651. <<NOTE: 42 USC 16041.>> NUCLEAR FACILITY AND MATERIALS 

 SECURITY.

 (a) Security Evaluations; Design Basis Threat Rulemaking.--

 (1) In general.--Chapter 14 of the Atomic Energy Act of 1954 

 (42 U.S.C. 2201 et seq.) (as amended by section 624(a)) is 

 amended by adding at the end the following:

``SEC. 170D. <<NOTE: 42 USC 2210d.>> SECURITY EVALUATIONS.

 ``a. Security Response Evaluations.--Not <<NOTE: Deadline.>> less 

often than once every 3 years, the Commission shall conduct security 

evaluations at each licensed facility that is part of a class of 

licensed facilities, as the Commission considers to be appropriate, to 

assess the ability of a private security force of a licensed facility to 

defend against any applicable design basis threat.

 ``b. Force-on-Force Exercises.--(1) The security evaluations shall 

include force-on-force exercises.

 ``(2) The force-on-force exercises shall, to the maximum extent 

practicable, simulate security threats in accordance with any design 

basis threat applicable to a facility.

 ``(3) In conducting a security evaluation, the Commission shall 

mitigate any potential conflict of interest that could influence the 

results of a force-on-force exercise, as the Commission determines to be 

necessary and appropriate.

 ``c. Action by Licensees.--The Commission shall ensure that an 

affected licensee corrects those material defects in performance that 

adversely affect the ability of a private security force at that 

facility to defend against any applicable design basis threat.

 ``d. Facilities Under Heightened Threat Levels.--The Commission may 

suspend a security evaluation under this section if the Commission 

determines that the evaluation would compromise security at a nuclear 

facility under a heightened threat level.

 ``e. Report.--Not less often than once each year, the Commission 

shall submit to the Committee on Environment and Public Works of the 

Senate and the Committee on Energy and Commerce of the House of 

Representatives a report, in classified form and unclassified form, that 

describes the results of each security response evaluation conducted and 

any relevant corrective action taken by a licensee during the previous 

year.

``SEC. 170E. <<NOTE: 42 USC 2210e.>> DESIGN BASIS THREAT RULEMAKING.

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 ``a. Rulemaking.--The <<NOTE: Deadlines.>> Commission shall--

[[Page 119 STAT. 800]]

 ``(1) not later than 90 days after the date of enactment of 

 this section, initiate a rulemaking proceeding, including notice 

 and opportunity for public comment, to be completed not later 

 than 18 months after that date, to revise the design basis 

 threats of the Commission; or

 ``(2) not later than 18 months after the date of enactment 

 of this section, complete any ongoing rulemaking to revise the 

 design basis threats.

 ``b. Factors.--When conducting its rulemaking, the Commission shall 

consider the following, but not be limited to--

 ``(1) the events of September 11, 2001;

 ``(2) an assessment of physical, cyber, biochemical, and 

 other terrorist threats;

 ``(3) the potential for attack on facilities by multiple 

 coordinated teams of a large number of individuals;

 ``(4) the potential for assistance in an attack from several 

 persons employed at the facility;

 ``(5) the potential for suicide attacks;

 ``(6) the potential for water-based and air-based threats;

 ``(7) the potential use of explosive devices of considerable 

 size and other modern weaponry;

 ``(8) the potential for attacks by persons with a 

 sophisticated knowledge of facility operations;

 ``(9) the potential for fires, especially fires of long 

 duration;

 ``(10) the potential for attacks on spent fuel shipments by 

 multiple coordinated teams of a large number of individuals;

 ``(11) the adequacy of planning to protect the public health 

 and safety at and around nuclear facilities, as appropriate, in 

 the event of a terrorist attack against a nuclear facility; and

 ``(12) the potential for theft and diversion of nuclear 

 materials from such facilities.''.

 (2) Conforming amendment.--The table of sections of the 

 Atomic Energy Act of 1954 (42 U.S.C. prec. 2011) (as amended by 

 section 624(b)) is amended by adding at the end of the items 

 relating to chapter 14 the following:

``Sec. 170D. Security evaluations.

``Sec. 170E. Design basis threat rulemaking.''.

 (3) Federal security coordinators.--

 (A) Regional offices.--Not <<NOTE: Deadline.>> later 

 than 18 months after the date of enactment of this Act, 

 the Nuclear Regulatory Commission (referred to in this 

 section as the ``Commission'') shall assign a Federal 

 security coordinator, under the employment of the 

 Commission, to each region of the Commission.

 (B) Responsibilities.--The Federal security 

 coordinator shall be responsible for--

 (i) communicating with the Commission and 

 other Federal, State, and local authorities 

 concerning threats, including threats against such 

 classes of facilities as the Commission determines 

 to be appropriate;

 (ii) monitoring such classes of facilities as 

 the Commission determines to be appropriate to 

 ensure that they maintain security consistent with 

 the security plan in accordance with the 

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 appropriate threat level; and

[[Page 119 STAT. 801]]

 (iii) assisting in the coordination of 

 security measures among the private security 

 forces at such classes of facilities as the 

 Commission determines to be appropriate and 

 Federal, State, and local authorities, as 

 appropriate.

 (b) Backup <<NOTE: Deadline.>> Power for Certain Emergency 

Notification Systems.--For any licensed nuclear power plants located 

where there is a permanent population, as determined by the 2000 

decennial census, in excess of 15,000,000 within a 50-mile radius of the 

power plant, not later than 18 months after enactment of this Act, the 

Commission shall require that backup power to be available for the 

emergency notification system of the power plant, including the 

emergency siren warning system, if the alternating current supply within 

the 10-mile emergency planning zone of the power plant is lost.

 (c) Additional Provisions.--

 (1) Provision of support to university nuclear safety, 

 security, and environmental protection programs.--Section 31 b. 

 of the Atomic Energy Act of 1954 (42 U.S.C. 2051(b)) is 

 amended--

 (A) by striking ``b. The Commission is further 

 authorized to make'' and inserting the following:

 ``b. Grants and Contributions.--The Commission is authorized--

 ``(1) to make'';

 (B) in paragraph (1) (as designated by subparagraph 

 (A)) by striking the period at the end and inserting ``; 

 and''; and

 (C) by adding at the end the following:

 ``(2) to provide grants, loans, cooperative agreements, 

 contracts, and equipment to institutions of higher education (as 

 defined in section 102 of the Higher Education Act of 1965 (20 

 U.S.C. 1002)) to support courses, studies, training, curricula, 

 and disciplines pertaining to nuclear safety, security, or 

 environmental protection, or any other field that the Commission 

 determines to be critical to the regulatory mission of the 

 Commission.''.

 (2) Recruitment tools.--Chapter 14 of the Atomic Energy Act 

 of 1954 (42 U.S.C. 2201 et seq.) (as amended by subsection 

 (a)(1)) is amended by adding at the end the following:

``SEC. 170F. <<NOTE: 42 USC 2210f.>> RECRUITMENT TOOLS.

 ``The Commission may purchase promotional items of nominal value for 

use in the recruitment of individuals for employment.''.

 (3) Expenses authorized to be paid by the commission.--

 Chapter 14 of the Atomic Energy Act of 1954 (42 U.S.C. 2201 et 

 seq.) (as amended by paragraph (2)) is amended by adding at the 

 end the following:

``SEC. 170G. <<NOTE: 42 USC 2210g.>> EXPENSES AUTHORIZED TO BE PAID BY 

 THE COMMISSION.

 ``The Commission may--

 ``(1) pay transportation, lodging, and subsistence expenses 

 of employees who--

 ``(A) assist scientific, professional, 

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 administrative, or technical employees of the 

 Commission; and

 ``(B) are students in good standing at an 

 institution of higher education (as defined in section 

 102 of the Higher Education Act of 1965 (20 U.S.C. 

 1002)) pursuing courses

[[Page 119 STAT. 802]]

 related to the field in which the students are employed 

 by the Commission; and

 ``(2) pay the costs of health and medical services 

 furnished, pursuant to an agreement between the Commission and 

 the Department of State, to employees of the Commission and 

 dependents of the employees serving in foreign countries.''.

 (4) Partnership program with institutions of higher 

 education.--

 (A) In general.--Chapter 19 of the Atomic Energy Act 

 of 1954 (42 U.S.C. 2015 et seq.) (as amended by section 

 622(a)) is amended by inserting after section 243 the 

 following:

``SEC. 244. <<NOTE: 42 USC 2015c.>> PARTNERSHIP PROGRAM WITH 

 INSTITUTIONS OF HIGHER EDUCATION.

 ``a. Definitions.--In this section:

 ``(1) Hispanic-serving institution.--The term `Hispanic-

 serving institution' has the meaning given the term in section 

 502(a) of the Higher Education Act of 1965 (20 U.S.C. 1101a(a)).

 ``(2) Historically black college and university.--The term 

 `historically Black college or university' has the meaning given 

 the term `part B institution' in section 322 of the Higher 

 Education Act of 1965 (20 U.S.C. 1061).

 ``(3) Tribal college.--The term `Tribal college' has the 

 meaning given the term `tribally controlled college or 

 university' in section 2(a) of the Tribally Controlled College 

 or University Assistance Act of 1978 (25 U.S.C. 1801(a)).

 ``b. Partnership Program.--The Commission may establish and 

participate in activities relating to research, mentoring, instruction, 

and training with institutions of higher education, including Hispanicserving institutions, historically Black colleges or universities, and 

Tribal colleges, to strengthen the capacity of the institutions--

 ``(1) to educate and train students (including present or 

 potential employees of the Commission); and

 ``(2) to conduct research in the field of science, 

 engineering, or law, or any other field that the Commission 

 determines is important to the work of the Commission.''.

 (5) Conforming amendments.--The table of sections of the 

 Atomic Energy Act of 1954 (42 U.S.C. prec. 2011) (as amended by 

 subsection (a)(2)) is amended--

 (A) by adding at the end of the items relating to 

 chapter 14 the following:

``Sec. 170F. Recruitment tools.

``Sec. 170G. Expenses authorized to be paid by the Commission.'';

 and

 (B) by inserting after the item relating to section 

 243 the following:

``Sec. 244. Partnership program with institutions of higher 

 education.''.

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 (d) Radiation Source Protection.--

 (1) Amendment.--Chapter 14 of the Atomic Energy Act of 1954 

 (42 U.S.C. 2201 et seq.) (as amended by subsection (c)(3)) is 

 amended by adding at the end the following:

``SEC. 170H. <<NOTE: 42 USC 2210h.>> RADIATION SOURCE PROTECTION.

 ``a. Definitions.--In this section:

[[Page 119 STAT. 803]]

 ``(1) Code of conduct.--The term `Code of Conduct' means the 

 code entitled the `Code of Conduct on the Safety and Security of 

 Radioactive Sources', approved by the Board of Governors of the 

 International Atomic Energy Agency and dated September 8, 2003.

 ``(2) Radiation source.--The term `radiation source' means--

 ``(A) a Category 1 Source or a Category 2 Source, as 

 defined in the Code of Conduct; and

 ``(B) any other material that poses a threat such 

 that the material is subject to this section, as 

 determined by the Commission, by regulation, other than 

 spent nuclear fuel and special nuclear materials.

 ``b. Commission Approval.--

Not <<NOTE: Deadline. Regulations.>> later than 180 days after the date 

of enactment of this section, the Commission shall issue regulations 

prohibiting a person from--

 ``(1) exporting a radiation source, unless the Commission 

 has specifically determined under section 57 or 82, consistent 

 with the Code of Conduct, with respect to the exportation, 

 that--

 ``(A) the recipient of the radiation source may 

 receive and possess the radiation source under the laws 

 and regulations of the country of the recipient;

 ``(B) the recipient country has the appropriate 

 technical and administrative capability, resources, and 

 regulatory structure to ensure that the radiation source 

 will be managed in a safe and secure manner; and

 ``(C) <<NOTE: Deadline. Notification.>> before the 

 date on which the radiation source is shipped--

 ``(i) a notification has been provided to the 

 recipient country; and

 ``(ii) a notification has been received from 

 the recipient country;

 as the Commission determines to be appropriate;

 ``(2) importing a radiation source, unless the Commission 

 has determined, with respect to the importation, that--

 ``(A) the proposed recipient is authorized by law to 

 receive the radiation source; and

 ``(B) the shipment will be made in accordance with 

 any applicable Federal or State law or regulation; and

 ``(3) selling or otherwise transferring ownership of a 

 radiation source, unless the Commission--

 ``(A) has determined that the licensee has verified 

 that the proposed recipient is authorized under law to 

 receive the radiation source; and

 ``(B) has required that the transfer shall be made 

 in accordance with any applicable Federal or State law 

 or regulation.

 ``c. Tracking System.--(1)(A) 

Not <<NOTE: Deadline. Regulations.>> later than 1 year after the date of 

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enactment of this section, the Commission shall issue regulations 

establishing a mandatory tracking system for radiation sources in the 

United States.

 ``(B) In establishing the tracking system under subparagraph (A), 

the Commission shall coordinate with the Secretary of Transportation to 

ensure compatibility, to the maximum extent

[[Page 119 STAT. 804]]

practicable, between the tracking system and any system established by 

the Secretary of Transportation to track the shipment of radiation 

sources.

 ``(2) The tracking system under paragraph (1) shall--

 ``(A) enable the identification of each radiation source by 

 serial number or other unique identifier;

 ``(B) require reporting within 7 days of any change of 

 possession of a radiation source;

 ``(C) require reporting within 24 hours of any loss of 

 control of, or accountability for, a radiation source; and

 ``(D) provide for reporting under subparagraphs (B) and (C) 

 through a secure Internet connection.

 ``d. Penalty.--A violation of a regulation issued under subsection 

a. or b. shall be punishable by a civil penalty not to exceed 

$1,000,000.

 ``e. National <<NOTE: Deadline. Contracts.>> Academy of Sciences 

Study.--(1) Not later than 60 days after the date of enactment of this 

section, the Commission shall enter into an arrangement with the 

National Academy of Sciences under which the National Academy of 

Sciences shall conduct a study of industrial, research, and commercial 

uses for radiation sources.

 ``(2) The study under paragraph (1) shall include a review of uses 

of radiation sources in existence on the date on which the study is 

conducted, including an identification of any industrial or other 

process that--

 ``(A) uses a radiation source that could be replaced with an 

 economically and technically equivalent (or improved) process 

 that does not require the use of a radiation source; or

 ``(B) may be used with a radiation source that would pose a 

 lower risk to public health and safety in the event of an 

 accident or attack involving the radiation source.

 ``(3) <<NOTE: Deadline.>> Not later than 2 years after the date of 

enactment of this section, the Commission shall submit to Congress the 

results of the study under paragraph (1).

 ``f. Task <<NOTE: Establishment.>> Force on Radiation Source 

Protection and Security.--(1) There is established a task force on 

radiation source protection and security (referred to in this section as 

the `task force').

 ``(2)(A) The chairperson of the task force shall be the Chairperson 

of the Commission (or a designee).

 ``(B) The membership of the task force shall consist of the 

following:

 ``(i) The Secretary of Homeland Security (or a designee).

 ``(ii) The Secretary of Defense (or a designee).

 ``(iii) The Secretary of Energy (or a designee).

 ``(iv) The Secretary of Transportation (or a designee).

 ``(v) The Attorney General (or a designee).

 ``(vi) The Secretary of State (or a designee).

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 ``(vii) The Director of National Intelligence (or a 

 designee).

 ``(viii) The Director of the Central Intelligence Agency (or 

 a designee).

 ``(ix) The Director of the Federal Emergency Management 

 Agency (or a designee).

 ``(x) The Director of the Federal Bureau of Investigation 

 (or a designee).

[[Page 119 STAT. 805]]

 ``(xi) The Administrator of the Environmental Protection 

 Agency (or a designee).

 ``(3)(A) The task force, in consultation with Federal, State, and 

local agencies, the Conference of Radiation Control Program Directors, 

and the Organization of Agreement States, and after public notice and an 

opportunity for comment, shall evaluate, and provide recommendations 

relating to, the security of radiation sources in the United States from 

potential terrorist threats, including acts of sabotage, theft, or use 

of a radiation source in a radiological dispersal device.

 ``(B) <<NOTE: Deadlines. Reports.>> Not later than 1 year after the 

date of enactment of this section, and not less than once every 4 years 

thereafter, the task force shall submit to Congress and the President a 

report, in unclassified form with a classified annex if necessary, 

providing recommendations, including recommendations for appropriate 

regulatory and legislative changes, for--

 ``(i) a list of additional radiation sources that should be 

 required to be secured under this Act, based on the potential 

 attractiveness of the sources to terrorists and the extent of 

 the threat to public health and safety of the sources, taking 

 into consideration--

 ``(I) radiation source radioactivity levels;

 ``(II) radioactive half-life of a radiation source;

 ``(III) dispersability;

 ``(IV) chemical and material form;

 ``(V) for radioactive materials with a medical use, 

 the availability of the sources to physicians and 

 patients for medical treatment; and

 ``(VI) any other factor that the Chairperson of the 

 Commission determines to be appropriate;

 ``(ii) the establishment of, or modifications to, a national 

 system for recovery of lost or stolen radiation sources;

 ``(iii) the storage of radiation sources that are not used 

 in a safe and secure manner as of the date on which the report 

 is submitted;

 ``(iv) modifications to the national tracking system for 

 radiation sources;

 ``(v) the establishment of, or modifications to, a national 

 system (including user fees and other methods) to provide for 

 the proper disposal of radiation sources secured under this Act;

 ``(vi) modifications to export controls on radiation sources 

 to ensure that foreign recipients of radiation sources are able 

 and willing to adequately control radiation sources from the 

 United States;

 ``(vii)(I) any alternative technologies available as of the 

 date on which the report is submitted that may perform some or 

 all of the functions performed by devices or processes that 

 employ radiation sources; and

 ``(II) the establishment of appropriate regulations and 

 incentives for the replacement of the devices and processes 

 described in subclause (I)--

 ``(aa) with alternative technologies in order to 

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 reduce the number of radiation sources in the United 

 States; or

 ``(bb) with radiation sources that would pose a 

 lower risk to public health and safety in the event of 

 an accident or attack involving the radiation source; 

 and

[[Page 119 STAT. 806]]

 ``(viii) the creation of, or modifications to, procedures 

 for improving the security of use, transportation, and storage 

 of radiation sources, including--

 ``(I) periodic audits or inspections by the 

 Commission to ensure that radiation sources are properly 

 secured and can be fully accounted for;

 ``(II) evaluation of the security measures by the 

 Commission;

 ``(III) increased fines for violations of Commission 

 regulations relating to security and safety measures 

 applicable to licensees that possess radiation sources;

 ``(IV) criminal and security background checks for 

 certain individuals with access to radiation sources 

 (including individuals involved with transporting 

 radiation sources);

 ``(V) requirements for effective and timely 

 exchanges of information relating to the results of 

 criminal and security background checks between the 

 Commission and any State with which the Commission has 

 entered into an agreement under section 274 b.;

 ``(VI) assurances of the physical security of 

 facilities that contain radiation sources (including 

 facilities used to temporarily store radiation sources 

 being transported); and

 ``(VII) the screening of shipments to facilities 

 that the Commission determines to be particularly at 

 risk for sabotage of radiation sources to ensure that 

 the shipments do not contain explosives.

 ``g. Action by Commission.--Not <<NOTE: Deadline.>> later than 60 

days after the date of receipt by Congress and the President of a report 

under subsection f.(3)(B), the Commission, in accordance with the 

recommendations of the task force, shall--

 ``(1) take any action the Commission determines to be 

 appropriate, including revising the system of the Commission for 

 licensing radiation sources; and

 ``(2) ensure that States that have entered into agreements 

 with the Commission under section 274 b. take similar action in 

 a timely manner.''.

 (2) Conforming amendment.--The table of sections of the 

 Atomic Energy Act of 1954 (42 U.S.C. prec. 2011) (as amended by 

 subsection (c)(5)(A)) is amended by adding at the end of the 

 items relating to chapter 14 the following:

``Sec. 170H. Radiation source protection.''.

 (e) Treatment of Accelerator-produced and Other Radioactive Material 

as Byproduct Material.--

 (1) Definition of byproduct material.--Section 11 e. of the 

 Atomic Energy Act of 1954 (42 U.S.C. 2014(e)) is amended--

 (A) by striking ``means (1) any radioactive'' and 

 inserting the following: ``means--

 ``(1) any radioactive''.

 (B) by striking ``material, and (2) the tailings'' 

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 and inserting the following: ``material;

 ``(2) the tailings''.

 (C) by striking ``content.'' and inserting the 

 following: ``content;

 ``(3)(A) any discrete source of radium-226 that is produced, 

 extracted, or converted after extraction, before, on, or after

[[Page 119 STAT. 807]]

 the date of enactment of this paragraph for use for a 

 commercial, medical, or research activity; or

 ``(B) any material that--

 ``(i) has been made radioactive by use of a particle 

 accelerator; and

 ``(ii) is produced, extracted, or converted after 

 extraction, before, on, or after the date of enactment 

 of this paragraph for use for a commercial, medical, or 

 research activity; and

 ``(4) any discrete source of naturally occurring radioactive 

 material, other than source material, that--

 ``(A) the Commission, in consultation with the 

 Administrator of the Environmental Protection Agency, 

 the Secretary of Energy, the Secretary of Homeland 

 Security, and the head of any other appropriate Federal 

 agency, determines would pose a threat similar to the 

 threat posed by a discrete source of radium-226 to the 

 public health and safety or the common defense and 

 security; and

 ``(B) before, on, or after the date of enactment of 

 this paragraph is extracted or converted after 

 extraction for use in a commercial, medical, or research 

 activity.''.

 (2) Agreements with governors.--Section 274 b. of the Atomic 

 Energy Act of 1954 (42 U.S.C. 2021(b)) is amended by striking 

 ``State--'' and all that follows through paragraph (4) and 

 inserting the following: ``State:

 ``(1) Byproduct materials (as defined in section 11 e.).

 ``(2) Source materials.

 ``(3) Special nuclear materials in quantities not sufficient 

 to form a critical mass.''.

 (3) Waste disposal.--

 (A) Domestic distribution.--Section 81 of the Atomic 

 Energy Act of 1954 (42 U.S.C. 2111) is amended--

 (i) by striking ``No person may'' and 

 inserting the following:

 ``a. In General.--No person may''.

 (ii) by adding at the end the following:

 ``b. Requirements.--

 ``(1) In general.--Except as provided in paragraph (2), 

 byproduct material, as defined in paragraphs (3) and (4) of 

 section 11 e., may only be transferred to and disposed of in a 

 disposal facility that--

 ``(A) is adequate to protect public health and 

 safety; and

 ``(B)(i) is licensed by the Commission; or

 ``(ii) is licensed by a State that has entered into 

 an agreement with the Commission under section 274 b., 

 if the licensing requirements of the State are 

 compatible with the licensing requirements of the 

 Commission.

 ``(2) Effect of subsection.--Nothing in this subsection 

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 affects the authority of any entity to dispose of byproduct 

 material, as defined in paragraphs (3) and (4) of section 11 e., 

 at a disposal facility in accordance with any Federal or State 

 solid or hazardous waste law, including the Solid Waste Disposal 

 Act (42 U.S.C. 6901 et seq.).

 ``c. Treatment as Low-level Radioactive Waste.--Byproduct material, 

as defined in paragraphs (3) and (4) of section 11 e.,

[[Page 119 STAT. 808]]

disposed of under this section shall not be considered to be low-level 

radioactive waste for the purposes of--

 ``(1) section 2 of the Low-Level Radioactive Waste Policy 

 Act (42 U.S.C. 2021b); or

 ``(2) carrying out a compact that is--

 ``(A) entered into in accordance with that Act (42 

 U.S.C. 2021b et seq.); and

 ``(B) approved by Congress.''.

 (B) Definition of low-level radioactive waste.--

 Section 2(9) of the Low-Level Radioactive Waste Policy 

 Act (42 U.S.C. 2021b(9)) is amended--

 (i) by redesignating subparagraphs (A) and (B) 

 as clauses (i) and (ii), respectively, and 

 indenting the clauses appropriately;

 (ii) in the matter preceding clause (i) (as 

 redesignated by subparagraph (A)) by striking 

 ``The term'' and inserting the following:

 ``(A) In general.--The term''; and

 (iii) by adding at the end the following:

 ``(B) Exclusion.--The term `low-level radioactive 

 waste' does not include byproduct material (as defined 

 in paragraphs (3) and (4) of section 11 e. of the Atomic 

 Energy Act of 1954 (42 U.S.C. 2014(e)).''.

 (4) Final regulations.--

 (A) Regulations.--

 (i) In general.--Not <<NOTE: Deadline.>> later 

 than 18 months after the date of enactment of this 

 Act, the Commission, after consultation with 

 States and other stakeholders, shall issue final 

 regulations establishing such requirements as the 

 Commission determines to be necessary to carry out 

 this section and the amendments made by this 

 section.

 (ii) Inclusions.--The regulations shall 

 include a definition of the term ``discrete 

 source'' for purposes of paragraphs (3) and (4) of 

 section 11 e. of the Atomic Energy Act of 1954 (42 

 U.S.C. 2014(e)) (as amended by paragraph (1)).

 (B) Cooperation.--In promulgating regulations under 

 paragraph (1), the Commission shall, to the maximum 

 extent practicable--

 (i) cooperate with States; and

 (ii) use model State standards in existence on 

 the date of enactment of this Act.

 (C) Transition plan.--

 (i) Definition of byproduct material.--In this 

 paragraph, the term ``byproduct material'' has the 

 meaning given the term in paragraphs (3) and (4) 

 of section 11 e. of the Atomic Energy Act of 1954 

 (42 U.S.C. 2014(e)) (as amended by paragraph (1)).

 (ii) Preparation and publication.--To 

 facilitate an orderly transition of regulatory 

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 authority with respect to byproduct material, the 

 Commission, in issuing regulations under 

 subparagraph (A), shall prepare and publish a 

 transition plan for--

 (I) States that have not, before the 

 date on which the plan is published, 

 entered into an agreement with the 

 Commission under section 274 b.

[[Page 119 STAT. 809]]

 of the Atomic Energy Act of 1954 (42 

 U.S.C. 2021(b)); and

 (II) States that have entered into 

 an agreement with the Commission under 

 that section before the date on which 

 the plan is published.

 (iii) Inclusions.--The transition plan under 

 clause (ii) shall include--

 (I) a description of the conditions 

 under which a State may exercise 

 authority over byproduct material; and

 (II) a statement of the Commission 

 that any agreement covering byproduct 

 material, as defined in paragraph (1) or 

 (2) of section 11e. of the Atomic Energy 

 Act of 1954 (42 U.S.C. 2014(e)), entered 

 into between the Commission and a State 

 under section 274 b. of that Act (42 

 U.S.C. 2021(b)) before the date of 

 publication of the transition plan shall 

 be considered to include byproduct 

 material, as defined in paragraph (3) or 

 (4) of section 11e. of that Act (42 

 U.S.C. 2014(e)) (as amended by paragraph 

 (1)), if the Governor of the State 

 certifies to the Commission on the date 

 of publication of the transition plan 

 that--

 (aa) the State has a program 

 for licensing byproduct 

 material, as defined in 

 paragraph (3) or (4) of section 

 11e. of the Atomic Energy Act of 

 1954, that is adequate to 

 protect the public health and 

 safety, as determined by the 

 Commission; and

 (bb) the State intends to 

 continue to implement the 

 regulatory responsibility of the 

 State with respect to the 

 byproduct material.

 (D) Availability of radiopharmaceuticals.--In 

 promulgating regulations under subparagraph (A), the 

 Commission shall consider the impact on the availability 

 of radiopharmaceuticals to--

 (i) physicians; and

 (ii) patients the medical treatment of which 

 relies on radiopharmaceuticals.

 (5) Waivers.--

 (A) In general.--Except as provided in subparagraph 

 (B), the Commission may grant a waiver to any entity of 

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 any requirement under this section or an amendment made 

 by this section with respect to a matter relating to 

 byproduct material (as defined in paragraphs (3) and (4) 

 of section 11 e. of the Atomic Energy Act of 1954 (42 

 U.S.C. 2014(e)) (as amended by paragraph (1))) if the 

 Commission determines that the waiver is in accordance 

 with the protection of the public health and safety and 

 the promotion of the common defense and security.

 (B) Exceptions.--

 (i) In general.--The Commission may not grant 

 a waiver under subparagraph (A) with respect to--

 (I) any requirement under the 

 amendments made by subsection (c)(1);

 (II) a matter relating to an 

 importation into, or exportation from, 

 the United States for a period

[[Page 119 STAT. 810]]

 ending after the date that is 1 year 

 after the date of enactment of this Act; 

 or

 (III) any other matter for a period 

 ending after the date that is 4 years 

 after the date of enactment of this Act.

 (ii) Waivers to states.--The Commission shall 

 terminate any waiver granted to a State under 

 subparagraph (A) if the Commission determines 

 that--

 (I) the State has entered into an 

 agreement with the Commission under 

 section 274 b. of the Atomic Energy Act 

 of 1954 (42 U.S.C. 2021(b));

 (II) the agreement described in 

 subclause (I) covers byproduct material 

 (as described in paragraph (3) or (4) of 

 section 11 e. of the Atomic Energy Act 

 of 1954 (42 U.S.C. 2014(e)) (as amended 

 by paragraph (1))); and

 (III) the program of the State for 

 licensing such byproduct material is 

 adequate to protect the public health 

 and safety.

 (C) Publication.--The <<NOTE: Federal 

 Register, publication. Notice.>> Commission shall 

 publish in the Federal Register a notice of any waiver 

 granted under this subsection.

SEC. 652. FINGERPRINTING AND CRIMINAL HISTORY RECORD CHECKS.

 Section 149 of the Atomic Energy Act of 1954 (42 U.S.C. 2169) is 

amended--

 (1) in subsection a.--

 (A) by striking ``a. The Nuclear'' and all that 

 follows through ``section 147.'' and inserting the 

 following:

 ``a.(1)(A)(i) The Commission shall require each individual or entity 

described in clause (ii) to fingerprint each individual described in 

subparagraph (B) before the individual described in subparagraph (B) is 

permitted access under subparagraph (B).

 ``(ii) The individuals and entities referred to in clause (i) are 

individuals and entities that, on or before the date on which an 

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individual is permitted access under subparagraph (B)--

 ``(I) are licensed or certified to engage in an activity 

 subject to regulation by the Commission;

 ``(II) have filed an application for a license or 

 certificate to engage in an activity subject to regulation by 

 the Commission; or

 ``(III) <<NOTE: Notification.>> have notified the Commission 

 in writing of an intent to file an application for licensing, 

 certification, permitting, or approval of a product or activity 

 subject to regulation by the Commission.

 ``(B) The Commission shall require to be fingerprinted any 

individual who--

 ``(i) is permitted unescorted access to--

 ``(I) a utilization facility; or

 ``(II) radioactive material or other property 

 subject to regulation by the Commission that the 

 Commission determines to be of such significance to the 

 public health and safety or the common defense and 

 security as to warrant fingerprinting and background 

 checks; or

 ``(ii) is permitted access to safeguards information under 

 section 147.'';

[[Page 119 STAT. 811]]

 (B) by striking ``All fingerprints obtained by a 

 licensee or applicant as required in the preceding 

 sentence'' and inserting the following:

 ``(2) All fingerprints obtained by an individual or entity as 

required in paragraph (1)'';

 (C) by striking ``The costs of any identification 

 and records check conducted pursuant to the preceding 

 sentence shall be paid by the licensee or applicant.'' 

 and inserting the following:

 ``(3) The costs of an identification or records check under 

paragraph (2) shall be paid by the individual or entity required to 

conduct the fingerprinting under paragraph (1)(A).''; and

 (D) by striking ``Notwithstanding any other 

 provision of law, the Attorney General may provide all 

 the results of the search to the Commission, and, in 

 accordance with regulations prescribed under this 

 section, the Commission may provide such results to 

 licensee or applicant submitting such fingerprints.'' 

 and inserting the following:

 ``(4) Notwithstanding any other provision of law--

 ``(A) the Attorney General may provide any result of an 

 identification or records check under paragraph (2) to the 

 Commission; and

 ``(B) the Commission, in accordance with regulations 

 prescribed under this section, may provide the results to the 

 individual or entity required to conduct the fingerprinting 

 under paragraph (1)(A).'';

 (2) in subsection c.--

 (A) by striking ``, subject to public notice and 

 comment, regulations--'' and inserting ``requirements--

 ''; and

 (B) in paragraph (2)(B), by striking ``unescorted 

 access to the facility of a licensee or applicant'' and 

 inserting ``unescorted access to a utilization facility, 

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 radioactive material, or other property described in 

 subsection a.(1)(B)'';

 (3) by redesignating subsection d. as subsection e.; and

 (4) by inserting after subsection c. the following:

 ``d. The Commission may require a person or individual to conduct 

fingerprinting under subsection a.(1) by authorizing or requiring the 

use of any alternative biometric method for identification that has been 

approved by--

 ``(1) the Attorney General; and

 ``(2) the Commission, by regulation.''.

SEC. 653. USE OF FIREARMS BY SECURITY PERSONNEL.

 The Atomic Energy Act of 1954 is amended by inserting after section 

161 (42 U.S.C. 2201) the following:

``SEC. 161A. <<NOTE: 42 USC 2201a.>> USE OF FIREARMS BY SECURITY 

 PERSONNEL.

 ``a. Definitions.--In this section, the terms `handgun', `rifle', 

`shotgun', `firearm', `ammunition', `machinegun', `short-barreled 

shotgun', and `short-barreled rifle' have the meanings given the terms 

in section 921(a) of title 18, United States Code.

 ``b. Authorization.--Notwithstanding subsections (a)(4), (a)(5), 

(b)(2), (b)(4), and (o) of section 922 of title 18, United States Code, 

section 925(d)(3) of title 18, United States Code, section 5844 of the 

Internal Revenue Code of 1986, and any law (including regulations) of a 

State or a political subdivision of a State that prohibits the transfer, 

receipt, possession, transportation, importation, or use of a handgun, a 

rifle, a shotgun, a short-barreled shotgun, a short-

[[Page 119 STAT. 812]]

barreled rifle, a machinegun, a semiautomatic assault weapon, ammunition 

for any such gun or weapon, or a large capacity ammunition feeding 

device, in carrying out the duties of the Commission, the Commission may 

authorize the security personnel of any licensee or certificate holder 

of the Commission (including an employee of a contractor of such a 

licensee or certificate holder) to transfer, receive, possess, 

transport, import, and use 1 or more such guns, weapons, ammunition, or 

devices, if the Commission determines that--

 ``(1) the authorization is necessary to the discharge of the 

 official duties of the security personnel; and

 ``(2) the security personnel--

 ``(A) are not otherwise prohibited from possessing 

 or receiving a firearm under Federal or State laws 

 relating to possession of firearms by a certain category 

 of persons;

 ``(B) have successfully completed any requirement 

 under this section for training in the use of firearms 

 and tactical maneuvers;

 ``(C) are engaged in the protection of--

 ``(i) a facility owned or operated by a 

 licensee or certificate holder of the Commission 

 that is designated by the Commission; or

 ``(ii) radioactive material or other property 

 owned or possessed by a licensee or certificate 

 holder of the Commission, or that is being 

 transported to or from a facility owned or 

 operated by such a licensee or certificate holder, 

 and that has been determined by the Commission to 

 be of significance to the common defense and 

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 security or public health and safety; and

 ``(D) are discharging the official duties of the 

 security personnel in transferring, receiving, 

 possessing, transporting, or importing the weapons, 

 ammunition, or devices.

 ``c. Background Checks.--A person that receives, possesses, 

transports, imports, or uses a weapon, ammunition, or a device under 

subsection (b) shall be subject to a background check by the Attorney 

General, based on fingerprints and including a background check under 

section 103(b) of the Brady Handgun Violence Prevention Act (Public Law 

103-159; 18 U.S.C. 922 note) to determine whether the person is 

prohibited from possessing or receiving a firearm under Federal or State 

law.

 ``d. Effective Date.--This section takes effect on the date on which 

guidelines are issued by the Commission, with the approval of the 

Attorney General, to carry out this section.''.

SEC. 654. UNAUTHORIZED INTRODUCTION OF DANGEROUS WEAPONS.

 Section 229 of the Atomic Energy Act of 1954 (42 U.S.C. 2278a) is 

amended--

 (1) by striking ``Sec. 229, Trespass Upon Commission 

 Installations.--'' and inserting the following:

``SEC. 229. TRESPASS ON COMMISSION INSTALLATIONS.'';

 (2) by adjusting the indentations of subsections a., b., and 

 c. so as to reflect proper subsection indentations; and

 (3) in subsection a.--

 (A) in the first sentence, by striking ``a. The'' 

 and inserting the following:

 ``a.(1) The'';

[[Page 119 STAT. 813]]

 (B) in the second sentence, by striking ``Every'' 

 and inserting the following:

 ``(2) Every''; and

 (C) in paragraph (1) (as designated by subparagraph 

 (A))--

 (i) by striking ``or in the custody'' and 

 inserting ``in the custody''; and

 (ii) by inserting ``, or subject to the 

 licensing authority of the Commission or 

 certification by the Commission under this Act or 

 any other Act'' before the period.

SEC. 655. SABOTAGE OF NUCLEAR FACILITIES, FUEL, OR DESIGNATED MATERIAL.

 (a) In General.--Section 236a. of the Atomic Energy Act of 1954 (42 

U.S.C. 2284(a)) is amended--

 (1) in paragraph (2), by striking ``storage facility'' and 

 inserting ``treatment, storage, or disposal facility'';

 (2) in paragraph (3)--

 (A) by striking ``such a utilization facility'' and 

 inserting ``a utilization facility licensed under this 

 Act''; and

 (B) by striking ``or'' at the end;

 (3) in paragraph (4)--

 (A) by striking ``facility licensed'' and inserting 

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 ``, uranium conversion, or nuclear fuel fabrication 

 facility licensed or certified''; and

 (B) by striking the comma at the end and inserting a 

 semicolon; and

 (4) by inserting after paragraph (4) the following:

 ``(5) any production, utilization, waste storage, waste 

 treatment, waste disposal, uranium enrichment, uranium 

 conversion, or nuclear fuel fabrication facility subject to 

 licensing or certification under this Act during construction of 

 the facility, if the destruction or damage caused or attempted 

 to be caused could adversely affect public health and safety 

 during the operation of the facility;

 ``(6) any primary facility or backup facility from which a 

 radiological emergency preparedness alert and warning system is 

 activated; or

 ``(7) any radioactive material or other property subject to 

 regulation by the Commission that, before the date of the 

 offense, the Commission determines, by order or regulation 

 published in the Federal Register, is of significance to the 

 public health and safety or to common defense and security;''.

 (b) Conforming Amendment.--Section 236 of the Atomic Energy Act of 

1954 (42 U.S.C. 2284) is amended by striking ``intentionally and 

willfully'' each place it appears and inserting ``knowingly''.

SEC. 656. SECURE TRANSFER OF NUCLEAR MATERIALS.

 (a) Amendment.--Chapter 14 of the Atomic Energy Act of 1954 (42 

U.S.C. 2201-2210b) (as amended by section 651(d)(1)) is amended by 

adding at the end the following new section:

``SEC. 170I. <<NOTE: 42 USC 2210i.>> SECURE TRANSFER OF NUCLEAR 

 MATERIALS.

 ``a. <<NOTE: Procedures.>> The Commission shall establish a system 

to ensure that materials described in subsection b., when transferred or 

received in the United States by any party pursuant to an import or 

export

[[Page 119 STAT. 814]]

license issued pursuant to this Act, are accompanied by a manifest 

describing the type and amount of materials being transferred or 

received. Each individual receiving or accompanying the transfer of such 

materials shall be subject to a security background check conducted by 

appropriate Federal entities.

 ``b. Except as otherwise provided by the Commission by regulation, 

the materials referred to in subsection a. are byproduct materials, 

source materials, special nuclear materials, high-level radioactive 

waste, spent nuclear fuel, transuranic waste, and low-level radioactive 

waste (as defined in section 2(16) of the Nuclear Waste Policy Act of 

1982 (42 U.S.C. 10101(16))).''.

 (b) Regulations.--Not <<NOTE: Deadline. 42 USC 2210i note.>> later 

than 1 year after the date of the enactment of this Act, and from time 

to time thereafter as it considers necessary, the Nuclear Regulatory 

Commission shall issue regulations identifying radioactive materials or 

classes of individuals that, consistent with the protection of public 

health and safety and the common defense and security, are appropriate 

exceptions to the requirements of section 170D of the Atomic Energy Act 

of 1954, as added by subsection (a) of this section.

 (c) Effective Date.--The <<NOTE: 42 USC 2210i note.>> amendment made 

by subsection (a) shall take effect upon the issuance of regulations 

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under subsection (b), except that the background check requirement shall 

become effective on a date established by the Commission.

 (d) Effect on Other Law.--Nothing <<NOTE: 42 USC 2210i note.>> in 

this section or the amendment made by this section shall waive, modify, 

or affect the application of chapter 51 of title 49, United States Code, 

part A of subtitle V of title 49, United States Code, part B of subtitle 

VI of title 49, United States Code, and title 23, United States Code.

 (e) Conforming Amendment.--The table of sections of the Atomic 

Energy Act of 1954 (42 U.S.C. prec. 2011) (as amended by subsection (a)) 

is amended by adding at the end of the items relating to chapter 14 the 

following:

``Sec. 170I. Secure transfer of nuclear materials.''.

SEC. 657. <<NOTE: 42 USC 16042.>> DEPARTMENT OF HOMELAND SECURITY 

 CONSULTATION.

 Before issuing a license for a utilization facility, the Nuclear 

Regulatory Commission shall consult with the Department of Homeland 

Security concerning the potential vulnerabilities of the location of the 

proposed facility to terrorist attack.

 TITLE VII--VEHICLES AND FUELS

 Subtitle A--Existing Programs

SEC. 701. USE OF ALTERNATIVE FUELS BY DUAL FUELED VEHICLES.

 Section 400AA(a)(3)(E) of the Energy Policy and Conservation Act (42 

U.S.C. 6374(a)(3)(E)) is amended to read as follows:

 ``(E)(i) Dual fueled vehicles acquired pursuant to this section 

shall be operated on alternative fuels unless the Secretary determines 

that an agency qualifies for a waiver of such requirement for vehicles 

operated by the agency in a particular geographic area in which--

 ``(I) the alternative fuel otherwise required to be used in 

 the vehicle is not reasonably available to retail purchasers

[[Page 119 STAT. 815]]

 of the fuel, as certified to the Secretary by the head of the 

 agency; or

 ``(II) the cost of the alternative fuel otherwise required 

 to be used in the vehicle is unreasonably more expensive 

 compared to gasoline, as certified to the Secretary by the head 

 of the agency.

 ``(ii) <<NOTE: Reports.>> The Secretary shall monitor compliance 

with this subparagraph by all such fleets and shall report annually to 

Congress on the extent to which the requirements of this subparagraph 

are being achieved. The report shall include information on annual 

reductions achieved from the use of petroleum-based fuels and the 

problems, if any, encountered in acquiring alternative fuels.''.

SEC. 702. INCREMENTAL COST ALLOCATION.

 Section 303(c) of the Energy Policy Act of 1992 (42 U.S.C. 13212(c)) 

is amended by striking ``may'' and inserting ``shall''.

SEC. 703. ALTERNATIVE COMPLIANCE AND FLEXIBILITY.

 (a) Alternative Compliance.--Title V of the Energy Policy Act of 

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1992 (42 U.S.C. 13251 et seq.) is amended--

 (1) by redesignating section 514 (42 U.S.C. 13264) as 

 section 515; and

 (2) by inserting after section 513 (42 U.S.C. 13263) the 

 following:

``SEC. 514. <<NOTE: 42 USC 13263a.>> ALTERNATIVE COMPLIANCE.

 ``(a) Application for Waiver.--Any covered person subject to section 

501 and any State subject to section 507(o) may petition the Secretary 

for a waiver of the applicable requirements of section 501 or 507(o).

 ``(b) Grant of Waiver.--The Secretary shall grant a waiver of the 

requirements of section 501 or 507(o) on a showing that the fleet owned, 

operated, leased, or otherwise controlled by the State or covered 

person--

 ``(1) will achieve a reduction in the annual consumption of 

 petroleum fuels by the fleet equal to--

 ``(A) the reduction in consumption of petroleum that 

 would result from 100 percent cumulative compliance with 

 the fuel use requirements of section 501; or

 ``(B) in the case of an entity covered under section 

 507(o), a reduction equal to the annual consumption by 

 the State entity of alternative fuels if all of the 

 cumulative alternative fuel vehicles of the State entity 

 given credit under section 508 were to use alternative 

 fuel 100 percent of the time; and

 ``(2) is in compliance with all applicable vehicle emission 

 standards established by the Administrator of the Environmental 

 Protection Agency under the Clean Air Act (42 U.S.C. 7401 et 

 seq.).

 ``(c) Reporting Requirement.--Not later than December 31 of a model 

year, any State or covered person granted a waiver under this section 

for the preceding model year shall submit to the Secretary an annual 

report that--

 ``(1) <<NOTE: Certification.>> certifies the quantity of the 

 petroleum motor fuel reduction of the State or covered person 

 during the preceding model year; and

[[Page 119 STAT. 816]]

 ``(2) projects the baseline quantity of the petroleum motor 

 fuel reduction of the State or covered person during the 

 following model year.

 ``(d) Revocation of Waiver.--If a State or covered person that 

receives a waiver under this section fails to comply with this section, 

the Secretary--

 ``(1) shall revoke the waiver; and

 ``(2) may impose on the State or covered person a penalty 

 under section 512.''.

 (b) Conforming Amendment.--Section 511 of the Energy Policy Act of 

1992 (42 U.S.C. 13261) is amended by striking ``or 507'' and inserting 

``507, or 514''.

 (c) Table of Contents Amendment.--The table of contents of the 

Energy Policy Act of 1992 (42 U.S.C. prec. 13201) is amended by striking 

the item relating to section 514 and inserting the following:

``Sec. 514. Alternative compliance.

``Sec. 515. Authorization of appropriations.''.

SEC. 704. REVIEW OF ENERGY POLICY ACT OF 1992 PROGRAMS.

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 (a) In General.--Not <<NOTE: Deadline.>> later than 180 days after 

the date of enactment of this section, the Secretary shall complete a 

study to determine the effect that titles III, IV, and V of the Energy 

Policy Act of 1992 (42 U.S.C. 13211 et seq.) have had on--

 (1) the development of alternative fueled vehicle 

 technology;

 (2) the availability of that technology in the market; and

 (3) the cost of alternative fueled vehicles.

 (b) Topics.--As part of the study under subsection (a), the 

Secretary shall specifically identify--

 (1) the number of alternative fueled vehicles acquired by 

 fleets or covered persons required to acquire alternative fueled 

 vehicles;

 (2) the quantity, by type, of alternative fuel actually used 

 in alternative fueled vehicles acquired by fleets or covered 

 persons;

 (3) the quantity of petroleum displaced by the use of 

 alternative fuels in alternative fueled vehicles acquired by 

 fleets or covered persons;

 (4) the direct and indirect costs of compliance with 

 requirements under titles III, IV, and V of the Energy Policy 

 Act of 1992 (42 U.S.C. 13211 et seq.), including--

 (A) vehicle acquisition requirements imposed on 

 fleets or covered persons;

 (B) administrative and recordkeeping expenses;

 (C) fuel and fuel infrastructure costs;

 (D) associated training and employee expenses; and

 (E) any other factors or expenses the Secretary 

 determines to be necessary to compile reliable estimates 

 of the overall costs and benefits of complying with 

 programs under those titles for fleets, covered persons, 

 and the national economy;

 (5) the existence of obstacles preventing compliance with 

 vehicle acquisition requirements and increased use of 

 alternative fuel in alternative fueled vehicles acquired by 

 fleets or covered persons; and

 (6) the projected impact of amendments to the Energy Policy 

 Act of 1992 made by this title.

[[Page 119 STAT. 817]]

 (c) Report.--Upon completion of the study under this section, the 

Secretary shall submit to Congress a report that describes the results 

of the study and includes any recommendations of the Secretary for 

legislative or administrative changes concerning the alternative fueled 

vehicle requirements under titles III, IV, and V of the Energy Policy 

Act of 1992 (42 U.S.C. 13211 et seq.).

SEC. 705. REPORT CONCERNING COMPLIANCE WITH ALTERNATIVE FUELED VEHICLE 

 PURCHASING REQUIREMENTS.

 Section 310(b)(1) of the Energy Policy Act of 1992 (42 U.S.C. 

13218(b)(1)) is amended by striking ``1 year after the date of enactment 

of this subsection'' and inserting ``February 15, 2006''.

SEC. 706. <<NOTE: 42 USC 16051.>> JOINT FLEXIBLE FUEL/HYBRID VEHICLE 

 COMMERCIALIZATION INITIATIVE.

 (a) Definitions.--In this section:

 (1) Eligible entity.--The term ``eligible entity'' means--

 (A) a for-profit corporation;

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 (B) a nonprofit corporation; or

 (C) an institution of higher education.

 (2) Program.--The term ``program'' means a program 

 established under subsection (b).

 (b) Establishment.--The Secretary shall establish a program to 

improve technologies for the commercialization of--

 (1) a combination hybrid/flexible fuel vehicle; or

 (2) a plug-in hybrid/flexible fuel vehicle.

 (c) Grants.--In carrying out the program, the Secretary shall 

provide grants that give preference to proposals that--

 (1) achieve the greatest reduction in miles per gallon of 

 petroleum fuel consumption;

 (2) achieve not less than 250 miles per gallon of petroleum 

 fuel consumption; and

 (3) have the greatest potential of commercialization to the 

 general public within 5 years.

 (d) Verification.--Not <<NOTE: Deadline. Federal 

Register, publication. Procedures.>> later than 90 days after the date 

of enactment of this Act, the Secretary shall publish in the Federal 

Register procedures to verify--

 (1) the hybrid/flexible fuel vehicle technologies to be 

 demonstrated; and

 (2) that grants are administered in accordance with this 

 section.

 (e) Report.--Not later than 260 days after the date of enactment of 

this Act, and annually thereafter, the Secretary shall submit to 

Congress a report that--

 (1) identifies the grant recipients;

 (2) describes the technologies to be funded under the 

 program;

 (3) assesses the feasibility of the technologies described 

 in paragraph (2) in meeting the goals described in subsection 

 (c);

 (4) identifies applications submitted for the program that 

 were not funded; and

 (5) makes recommendations for Federal legislation to achieve 

 commercialization of the technology demonstrated.

 (f) Authorization of Appropriations.--There are authorized to be 

appropriated to carry out this section, to remain available until 

expended--

 (1) $3,000,000 for fiscal year 2006;

[[Page 119 STAT. 818]]

 (2) $7,000,000 for fiscal year 2007;

 (3) $10,000,000 for fiscal year 2008; and

 (4) $20,000,000 for fiscal year 2009.

SEC. 707. EMERGENCY EXEMPTION.

 Section 301 of the Energy Policy Act of 1992 (42 U.S.C. 13211) is 

amended in paragraph (9)(E) by inserting before the semicolon at the end 

``, including vehicles directly used in the emergency repair of 

transmission lines and in the restoration of electricity service 

following power outages, as determined by the Secretary''.

 Subtitle B--Hybrid Vehicles, Advanced Vehicles, and Fuel Cell Buses

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 PART 1--HYBRID VEHICLES

SEC. 711. <<NOTE: 42 USC 16061.>> HYBRID VEHICLES.

 The Secretary shall accelerate efforts directed toward the 

improvement of batteries and other rechargeable energy storage systems, 

power electronics, hybrid systems integration, and other technologies 

for use in hybrid vehicles.

SEC. 712. <<NOTE: 42 USC 16062.>> EFFICIENT HYBRID AND ADVANCED DIESEL 

 VEHICLES.

 (a) Program.--The Secretary shall establish a program to encourage 

domestic production and sales of efficient hybrid and advanced diesel 

vehicles. The program shall include grants to automobile manufacturers 

to encourage domestic production of efficient hybrid and advanced diesel 

vehicles.

 (b) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary for carrying out this section such sums as 

may be necessary for each of the fiscal years 2006 through 2015.

 PART 2--ADVANCED VEHICLES

SEC. 721. <<NOTE: 42 USC 16071.>> PILOT PROGRAM.

 (a) Establishment.--The Secretary, in consultation with the 

Secretary of Transportation, shall establish a competitive grant pilot 

program (referred to in this part as the ``pilot program''), to be 

administered through the Clean Cities Program of the Department, to 

provide not more than 30 geographically dispersed project grants to 

State governments, local governments, or metropolitan transportation 

authorities to carry out a project or projects for the purposes 

described in subsection (b).

 (b) Grant Purposes.--A grant under this section may be used for the 

following purposes:

 (1) The acquisition of alternative fueled vehicles or fuel 

 cell vehicles, including--

 (A) passenger vehicles (including neighborhood 

 electric vehicles); and

 (B) motorized 2-wheel bicycles or other vehicles for 

 use by law enforcement personnel or other State or local 

 government or metropolitan transportation authority 

 employees.

 (2) The acquisition of alternative fueled vehicles, hybrid 

 vehicles, or fuel cell vehicles, including--

[[Page 119 STAT. 819]]

 (A) buses used for public transportation or 

 transportation to and from schools;

 (B) delivery vehicles for goods or services; and

 (C) ground support vehicles at public airports 

 (including vehicles to carry baggage or push or pull 

 airplanes toward or away from terminal gates).

 (3) The acquisition of ultra-low sulfur diesel vehicles.

 (4) Installation or acquisition of infrastructure necessary 

 to directly support an alternative fueled vehicle, fuel cell 

 vehicle, or hybrid vehicle project funded by the grant, 

 including fueling and other support equipment.

 (5) Operation and maintenance of vehicles, infrastructure, 

 and equipment acquired as part of a project funded by the grant.

 (c) Applications.--

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 (1) Requirements.--

 (A) In general.--The Secretary shall issue 

 requirements for applying for grants under the pilot 

 program.

 (B) Minimum requirements.--At a minimum, the 

 Secretary shall require that an application for a 

 grant--

 (i) be submitted by the head of a State or 

 local government or a metropolitan transportation 

 authority, or any combination thereof, and a 

 registered participant in the Clean Cities Program 

 of the Department; and

 (ii) include--

 (I) a description of the project 

 proposed in the application, including 

 how the project meets the requirements 

 of this part;

 (II) an estimate of the ridership or 

 degree of use of the project;

 (III) an estimate of the air 

 pollution emissions reduced and fossil 

 fuel displaced as a result of the 

 project, and a plan to collect and 

 disseminate environmental data, related 

 to the project to be funded under the 

 grant, over the life of the project;

 (IV) a description of how the 

 project will be sustainable without 

 Federal assistance after the completion 

 of the term of the grant;

 (V) a complete description of the 

 costs of the project, including 

 acquisition, construction, operation, 

 and maintenance costs over the expected 

 life of the project;

 (VI) a description of which costs of 

 the project will be supported by Federal 

 assistance under this part; and

 (VII) documentation to the 

 satisfaction of the Secretary that 

 diesel fuel containing sulfur at not 

 more than 15 parts per million is 

 available for carrying out the project, 

 and a commitment by the applicant to use 

 such fuel in carrying out the project.

 (2) Partners.--An applicant under paragraph (1) may carry 

 out a project under the pilot program in partnership with public 

 and private entities.

 (d) Selection Criteria.--In evaluating applications under the pilot 

program, the Secretary shall--

[[Page 119 STAT. 820]]

 (1) consider each applicant's previous experience with 

 similar projects; and

 (2) give priority consideration to applications that--

 (A) are most likely to maximize protection of the 

 environment;

 (B) demonstrate the greatest commitment on the part 

 of the applicant to ensure funding for the proposed 

 project and the greatest likelihood that the project 

 will be maintained or expanded after Federal assistance 

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 under this part is completed; and

 (C) exceed the minimum requirements of subsection 

 (c)(1)(B)(ii).

 (e) Pilot Project Requirements.--

 (1) Maximum amount.--The Secretary shall not provide more 

 than $15,000,000 in Federal assistance under the pilot program 

 to any applicant.

 (2) Cost sharing.--The Secretary shall not provide more than 

 50 percent of the cost, incurred during the period of the grant, 

 of any project under the pilot program.

 (3) Maximum period of grants.--The Secretary shall not fund 

 any applicant under the pilot program for more than 5 years.

 (4) Deployment and distribution.--The Secretary shall seek 

 to the maximum extent practicable to ensure a broad geographic 

 distribution of project sites.

 (5) Transfer of <<NOTE: Procedures.>> information and 

 knowledge.--The Secretary shall establish mechanisms to ensure 

 that the information and knowledge gained by participants in the 

 pilot program are transferred among the pilot program 

 participants and to other interested parties, including other 

 applicants that submitted applications.

 (f) <<NOTE: Deadlines.>> Schedule.--

 (1) Publication.--Not <<NOTE: Federal 

 Register, publication. Commerce Business Daily, 

 publication.>> later than 90 days after the date of enactment of 

 this Act, the Secretary shall publish in the Federal Register, 

 Commerce Business Daily, and elsewhere as appropriate, a request 

 for applications to undertake projects under the pilot program. 

 Applications shall be due not later than 180 days after the date 

 of publication of the notice.

 (2) Selection.--Not later than 180 days after the date by 

 which applications for grants are due, the Secretary shall 

 select by competitive, peer reviewed proposal, all applications 

 for projects to be awarded a grant under the pilot program.

 (g) Definitions.--For <<NOTE: Regulations.>> purposes of carrying 

out the pilot program, the Secretary shall issue regulations defining 

any term, as the Secretary determines to be necessary.

SEC. 722. <<NOTE: 42 USC 16072.>> REPORTS TO CONGRESS.

 (a) Initial Report.--Not later than 60 days after the date on which 

grants are awarded under this part, the Secretary shall submit to 

Congress a report containing--

 (1) an identification of the grant recipients and a 

 description of the projects to be funded;

 (2) an identification of other applicants that submitted 

 applications for the pilot program; and

 (3) a description of the mechanisms used by the Secretary to 

 ensure that the information and knowledge gained by participants 

 in the pilot program are transferred among the pilot

[[Page 119 STAT. 821]]

 program participants and to other interested parties, including 

 other applicants that submitted applications.

 (b) Evaluation.--Not later than 3 years after the date of enactment 

of this Act, and annually thereafter until the pilot program ends, the 

Secretary shall submit to Congress a report containing an evaluation of 

the effectiveness of the pilot program, including--

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 (1) an assessment of the benefits to the environment derived 

 from the projects included in the pilot program; and

 (2) an estimate of the potential benefits to the environment 

 to be derived from widespread application of alternative fueled 

 vehicles and ultra-low sulfur diesel vehicles.

SEC. 723. <<NOTE: 42 USC 16073.>> AUTHORIZATION OF APPROPRIATIONS.

 There are authorized to be appropriated to the Secretary to carry 

out this part $200,000,000, to remain available until expended.

 PART 3--FUEL CELL BUSES

SEC. 731. <<NOTE: 42 USC 16081.>> FUEL CELL TRANSIT BUS DEMONSTRATION.

 (a) In General.--The Secretary, in consultation with the Secretary 

of Transportation, shall establish a transit bus demonstration program 

to make competitive, merit-based awards for 5-year projects to 

demonstrate not more than 25 fuel cell transit buses (and necessary 

infrastructure) in 5 geographically dispersed localities.

 (b) Preference.--In selecting projects under this section, the 

Secretary shall give preference to projects that are most likely to 

mitigate congestion and improve air quality.

 (c) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out this section $10,000,000 for 

each of fiscal years 2006 through 2010.

 Subtitle C--Clean School Buses

SEC. 741. <<NOTE: 42 USC 16091.>> CLEAN SCHOOL BUS PROGRAM.

 (a) Definitions.--In this section:

 (1) Administrator.--The term ``Administrator'' means the 

 Administrator of the Environmental Protection Agency.

 (2) Alternative fuel.--The term ``alternative fuel'' means--

 (A) liquefied natural gas, compressed natural gas, 

 liquefied petroleum gas, hydrogen, or propane;

 (B) methanol or ethanol at no less than 85 percent 

 by volume; or

 (C) biodiesel conforming with standards published by 

 the American Society for Testing and Materials as of the 

 date of enactment of this Act.

 (3) Clean school bus.--The term ``clean school bus'' means a 

 school bus with a gross vehicle weight of greater than 14,000 

 pounds that--

 (A) is powered by a heavy duty engine; and

 (B) is operated solely on an alternative fuel or 

 ultra-low sulfur diesel fuel.

 (4) Eligible recipient.--

[[Page 119 STAT. 822]]

 (A) In general.--Subject to subparagraph (B), the 

 term ``eligible recipient'' means--

 (i) 1 or more local or State governmental 

 entities responsible for--

 (I) providing school bus service to 

 1 or more public school systems; or

 (II) the purchase of school buses;

 (ii) 1 or more contracting entities that 

 provide school bus service to 1 or more public 

 school systems; or

 (iii) a nonprofit school transportation 

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 association.

 (B) Special requirements.--In the case of eligible 

 recipients identified under clauses (ii) and (iii), the 

 Administrator shall establish timely and appropriate 

 requirements for notice and may establish timely and 

 appropriate requirements for approval by the public 

 school systems that would be served by buses purchased 

 or retrofit using grant funds made available under this 

 section.

 (5) Retrofit technology.--The term ``retrofit technology'' 

 means a particulate filter or other emissions control equipment 

 that is verified or certified by the Administrator or the 

 California Air Resources Board as an effective emission 

 reduction technology when installed on an existing school bus.

 (6) Ultra-low sulfur diesel fuel.--The term ``ultra-low 

 sulfur diesel fuel'' means diesel fuel that contains sulfur at 

 not more than 15 parts per million.

 (b) Program for Retrofit or Replacement of Certain Existing School 

Buses With Clean School Buses.--

 (1) Establishment.--

 (A) In general.--The Administrator, in consultation 

 with the Secretary and other appropriate Federal 

 departments and agencies, shall establish a program for 

 awarding grants on a competitive basis to eligible 

 recipients for the replacement, or retrofit (including 

 repowering, aftertreatment, and remanufactured engines) 

 of, certain existing school buses.

 (B) Balancing.--In awarding grants under this 

 section, the Administrator shall, to the maximum extent 

 practicable, achieve an appropriate balance between 

 awarding grants--

 (i) to replace school buses; and

 (ii) to install retrofit technologies.

 (2) Priority of grant applications.--

 (A) Replacement.--In the case of grant applications 

 to replace school buses, the Administrator shall give 

 priority to applicants that propose to replace school 

 buses manufactured before model year 1977.

 (B) Retrofitting.--In the case of grant applications 

 to retrofit school buses, the Administrator shall give 

 priority to applicants that propose to retrofit school 

 buses manufactured in or after model year 1991.

 (3) Use of school bus fleet.--

 (A) In general.--All school buses acquired or 

 retrofitted with funds provided under this section shall 

 be operated as part of the school bus fleet for which 

 the grant was made for not less than 5 years.

[[Page 119 STAT. 823]]

 (B) Maintenance, operation, and fueling.--New school 

 buses and retrofit technology shall be maintained, 

 operated, and fueled according to manufacturer 

 recommendations or State requirements.

 (4) Retrofit grants.--The Administrator may award grants for 

 up to 100 percent of the retrofit technologies and installation 

 costs.

 (5) Replacement grants.--

 (A) Eligibility for 50 percent grants.--The 

 Administrator may award grants for replacement of school 

 buses in the amount of up to one-half of the acquisition 

 costs (including fueling infrastructure) for--

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 (i) clean school buses with engines 

 manufactured in model year 2005 or 2006 that emit 

 not more than--

 (I) 1.8 grams per brake horsepower-

 hour of non-methane hydrocarbons and 

 oxides of nitrogen; and

 (II) .01 grams per brake horsepower-

 hour of particulate matter; or

 (ii) clean school buses with engines 

 manufactured in model year 2007, 2008, or 2009 

 that satisfy regulatory requirements established 

 by the Administrator for emissions of oxides of 

 nitrogen and particulate matter to be applicable 

 for school buses manufactured in model year 2010.

 (B) Eligibility for 25 percent grants.--The 

 Administrator may award grants for replacement of school 

 buses in the amount of up to one-fourth of the 

 acquisition costs (including fueling infrastructure) 

 for--

 (i) clean school buses with engines 

 manufactured in model year 2005 or 2006 that emit 

 not more than--

 (I) 2.5 grams per brake horsepower-

 hour of non-methane hydrocarbons and 

 oxides of nitrogen; and

 (II) .01 grams per brake horsepower-

 hour of particulate matter; or

 (ii) clean school buses with engines 

 manufactured in model year 2007 or thereafter that 

 satisfy regulatory requirements established by the 

 Administrator for emissions of oxides of nitrogen 

 and particulate matter from school buses 

 manufactured in that model year.

 (6) Ultra-low sulfur diesel fuel.--

 (A) In general.--In the case of a grant recipient 

 receiving a grant for the acquisition of ultra-low 

 sulfur diesel fuel school buses with engines 

 manufactured in model year 2005 or 2006, the grant 

 recipient shall provide, to the satisfaction of the 

 Administrator--

 (i) documentation that diesel fuel containing 

 sulfur at not more than 15 parts per million is 

 available for carrying out the purposes of the 

 grant; and

 (ii) a commitment by the applicant to use that 

 fuel in carrying out the purposes of the grant.

 (7) Deployment and distribution.--The Administrator shall, 

 to the maximum extent practicable--

 (A) achieve nationwide deployment of clean school 

 buses through the program under this section; and

[[Page 119 STAT. 824]]

 (B) ensure a broad geographic distribution of grant 

 awards, with no State receiving more than 10 percent of 

 the grant funding made available under this section 

 during a fiscal year.

 (8) Annual report.--

 (A) In general.--Not later than January 31 of each 

 year, the Administrator shall submit to Congress a 

 report that--

 (i) evaluates the implementation of this 

 section; and

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 (ii) describes--

 (I) the total number of grant 

 applications received;

 (II) the number and types of 

 alternative fuel school buses, ultra-low 

 sulfur diesel fuel school buses, and 

 retrofitted buses requested in grant 

 applications;

 (III) grants awarded and the 

 criteria used to select the grant 

 recipients;

 (IV) certified engine emission 

 levels of all buses purchased or 

 retrofitted under this section;

 (V) an evaluation of the in-use 

 emission level of buses purchased or 

 retrofitted under this section; and

 (VI) any other information the 

 Administrator considers appropriate.

 (c) Education.--

 (1) In general.--Not <<NOTE: Deadline.>> later than 90 days 

 after the date of enactment of this Act, the Administrator shall 

 develop an education outreach program to promote and explain the 

 grant program.

 (2) Coordination with stakeholders.--The outreach program 

 shall be designed and conducted in conjunction with national 

 school bus transportation associations and other stakeholders.

 (3) Components.--The outreach program shall--

 (A) inform potential grant recipients on the process 

 of applying for grants;

 (B) describe the available technologies and the 

 benefits of the technologies;

 (C) explain the benefits of participating in the 

 grant program; and

 (D) include, as appropriate, information from the 

 annual report required under subsection (b)(8).

 (d) Authorization of Appropriations.--There are authorized to be 

appropriated to the Administrator to carry out this section, to remain 

available until expended--

 (1) $55,000,000 for each of fiscal years 2006 and 2007; and

 (2) such sums as are necessary for each of fiscal years 

 2008, 2009, and 2010.

SEC. 742. <<NOTE: 42 USC 16092.>> DIESEL TRUCK RETROFIT AND FLEET 

 MODERNIZATION PROGRAM.

 (a) Establishment.--The Administrator, in consultation with the 

Secretary, shall establish a program for awarding grants on

[[Page 119 STAT. 825]]

a competitive basis to public agencies and entities for fleet 

modernization programs including installation of retrofit technologies 

for diesel trucks.

 (b) Eligible Recipients.--A grant shall be awarded under this 

section only to a State or local government or an agency or 

instrumentality of a State or local government or of two or more State 

or local governments who will allocate funds, with preference to ports 

and other major hauling operations.

 (c) Awards.--

 (1) In general.--The Administrator shall seek, to the 

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 maximum extent practicable, to ensure a broad geographic 

 distribution of grants under this section.

 (2) Preferences.--In making awards of grants under this 

 section, the Administrator shall give preference to proposals 

 that--

 (A) will achieve the greatest reductions in 

 emissions of nonmethane hydrocarbons, oxides of 

 nitrogen, and/or particulate matter per proposal or per 

 truck; or

 (B) involve the use of Environmental Protection 

 Agency or California Air Resources Board verified 

 emissions control retrofit technology on diesel trucks 

 that operate solely on ultra-low sulfur diesel fuel 

 after September 2006.

 (d) Conditions of Grant.--A grant shall be provided under this 

section on the conditions that--

 (1) trucks which are replacing scrapped trucks and on which 

 retrofit emissions-control technology are to be demonstrated--

 (A) will operate on ultra-low sulfur diesel fuel 

 where such fuel is reasonably available or required for 

 sale by State or local law or regulation;

 (B) were manufactured in model year 1998 and before; 

 and

 (C) will be used for the transportation of cargo 

 goods especially in port areas or used in goods movement 

 and major hauling operations;

 (2) grant funds will be used for the purchase of emission 

 control retrofit technology, including State taxes and contract 

 fees; and

 (3) grant recipients will provide at least 50 percent of the 

 total cost of the retrofit, including the purchase of emission 

 control retrofit technology and all necessary labor for 

 installation of the retrofit, from any source other than this 

 section.

 (e) Verification.--Not <<NOTE: Deadline. Federal 

Register, publication. Procedures.>> later than 90 days after the date 

of enactment of this Act, the Administrator shall publish in the Federal 

Register procedures to--

 (1) make grants pursuant to this section;

 (2) verify that trucks powered by ultra-low sulfur diesel 

 fuel on which retrofit emissions-control technology are to be 

 demonstrated will operate on diesel fuel containing not more 

 than 15 parts per million of sulfur after September 2006; and

 (3) verify that grants are administered in accordance with 

 this section.

 (f) Authorization of Appropriations.--There are authorized to be 

appropriated to the Administrator to carry out this section, to remain 

available until expended the following sums:

 (1) $20,000,000 for fiscal year 2006.

 (2) $35,000,000 for fiscal year 2007.

[[Page 119 STAT. 826]]

 (3) $45,000,000 for fiscal year 2008.

 (4) Such sums as are necessary for each of fiscal years 2009 

 and 2010.

SEC. 743. <<NOTE: 42 USC 16093.>> FUEL CELL SCHOOL BUSES.

 (a) Establishment.--The Secretary shall establish a program for 

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entering into cooperative agreements--

 (1) with private sector fuel cell bus developers for the 

 development of fuel cell-powered school buses; and

 (2) subsequently, with not less than 2 units of local 

 government using natural gas-powered school buses and such 

 private sector fuel cell bus developers to demonstrate the use 

 of fuel cell-powered school buses.

 (b) Cost Sharing.--The non-Federal contribution for activities 

funded under this section shall be not less than--

 (1) 20 percent for fuel infrastructure development 

 activities; and

 (2) 50 percent for demonstration activities and for 

 development activities not described in paragraph (1).

 (c) Reports to Congress.--Not later than 3 years after the date of 

enactment of this Act, the Secretary shall transmit to Congress a report 

that--

 (1) evaluates the process of converting natural gas 

 infrastructure to accommodate fuel cell-powered school buses; 

 and

 (2) assesses the results of the development and 

 demonstration program under this section.

 (d) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out this section $25,000,000 for 

the period of fiscal years 2006 through 2009.

 Subtitle D--Miscellaneous

SEC. 751. <<NOTE: 42 USC 16101.>> RAILROAD EFFICIENCY.

 (a) Establishment.--The Secretary shall (in cooperation with the 

Secretary of Transportation and the Administrator of the Environmental 

Protection Agency) establish a cost-shared, public-private research 

partnership involving the Federal Government, railroad carriers, 

locomotive manufacturers and equipment suppliers, and the Association of 

American Railroads, to develop and demonstrate railroad locomotive 

technologies that increase fuel economy, reduce emissions, and lower 

costs of operation.

 (b) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out this section--

 (1) $15,000,000 for fiscal year 2006;

 (2) $20,000,000 for fiscal year 2007; and

 (3) $30,000,000 for fiscal year 2008.

SEC. 752. MOBILE EMISSION REDUCTIONS TRADING AND CREDITING.

 (a) In General.--Not <<NOTE: Deadline. Reports.>> later than 180 

days after the date of enactment of this Act, the Administrator of the 

Environmental Protection Agency shall submit to Congress a report on the 

experience of the Administrator with the trading of mobile source 

emission reduction credits for use by owners and operators of stationary 

source emission sources to meet emission offset requirements within a 

nonattainment area.

 (b) Contents.--The report shall describe--

[[Page 119 STAT. 827]]

 (1) projects approved by the Administrator that include the 

 trading of mobile source emission reduction credits for use by 

 stationary sources in complying with offset requirements, 

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 including a description of--

 (A) project and stationary sources location;

 (B) volumes of emissions offset and traded;

 (C) the sources of mobile emission reduction 

 credits; and

 (D) if available, the cost of the credits;

 (2) the significant issues identified by the Administrator 

 in consideration and approval of trading in the projects;

 (3) the requirements for monitoring and assessing the air 

 quality benefits of any approved project;

 (4) the statutory authority on which the Administrator has 

 based approval of the projects;

 (5) an evaluation of how the resolution of issues in 

 approved projects could be used in other projects and whether 

 the emission reduction credits may be considered to be 

 additional in relation to other requirements;

 (6) the potential, for attainment purposes, of emission 

 reduction credits relating to transit and land use policies; and

 (7) any other issues that the Administrator considers 

 relevant to the trading and generation of mobile source emission 

 reduction credits for use by stationary sources or for other 

 purposes.

SEC. 753. AVIATION FUEL CONSERVATION AND EMISSIONS.

 (a) In General.--Not <<NOTE: Deadline.>> later than 60 days after 

the date of enactment of this Act, the Administrator of the Federal 

Aviation Administration and the Administrator of the Environmental 

Protection Agency shall jointly initiate a study to identify--

 (1) the impact of aircraft emissions on air quality in 

 nonattainment areas;

 (2) ways to promote fuel conservation measures for aviation 

 to enhance fuel efficiency and reduce emissions; and

 (3) opportunities to reduce air traffic inefficiencies that 

 increase fuel burn and emissions.

 (b) Focus.--The study under subsection (a) shall focus on how air 

traffic management inefficiencies, such as aircraft idling at airports, 

result in unnecessary fuel burn and air emissions.

 (c) Report.--Not later than 1 year after the date of the initiation 

of the study under subsection (a), the Administrator of the Federal 

Aviation Administration and the Administrator of the Environmental 

Protection Agency shall jointly submit to the Committee on Energy and 

Commerce and the Committee on Transportation and Infrastructure of the 

House of Representatives and the Committee on Environment and Public 

Works and the Committee on Commerce, Science, and Transportation of the 

Senate a report that--

 (1) describes the results of the study; and

 (2) includes any recommendations on ways in which 

 unnecessary fuel use and emissions affecting air quality may be 

 reduced--

 (A) without adversely affecting safety and security 

 and increasing individual aircraft noise; and

 (B) while taking into account all aircraft emissions 

 and the impact of those emissions on the human health.

[[Page 119 STAT. 828]]

 (d) Risk Assessments.--Any assessment of risk to human health and 

the environment prepared by the Administrator of the Federal Aviation 

Administration or the Administrator of the Environmental Protection 

Agency to support the report in this section shall be based on sound and 

objective scientific practices, shall consider the best available 

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science, and shall present the weight of the scientific evidence 

concerning such risks.

SEC. 754. <<NOTE: 42 USC 16102.>> DIESEL FUELED VEHICLES.

 (a) Definition of Tier 2 Emission Standards.--In this section, the 

term ``tier 2 emission standards'' means the motor vehicle emission 

standards that apply to passenger cars, light trucks, and larger 

passenger vehicles manufactured after the 2003 model year, as issued on 

February 10, 2000, by the Administrator of the Environmental Protection 

Agency under sections 202 and 211 of the Clean Air Act (42 U.S.C. 7521, 

7545).

 (b) Diesel Combustion and After-Treatment Technologies.--The 

Secretary shall accelerate efforts to improve diesel combustion and 

after-treatment technologies for use in diesel fueled motor vehicles.

 (c) Goals.--The Secretary shall carry out subsection (b) with a view 

toward achieving the following goals:

 (1) Developing and demonstrating diesel technologies that, 

 not later than 2010, meet the following standards:

 (A) Tier 2 emission standards.

 (B) The heavy-duty emissions standards of 2007 that 

 are applicable to heavy-duty vehicles under regulations 

 issued by the Administrator of the Environmental 

 Protection Agency as of the date of enactment of this 

 Act.

 (2) Developing the next generation of low-emission, high 

 efficiency diesel engine technologies, including homogeneous 

 charge compression ignition technology.

SEC. 755. <<NOTE: 42 USC 16103.>> CONSERVE BY BICYCLING PROGRAM.

 (a) Definitions.--In this section:

 (1) Program.--The term ``program'' means the Conserve by 

 Bicycling Program established by subsection (b).

 (2) Secretary.--The term ``Secretary'' means the Secretary 

 of Transportation.

 (b) Establishment.--There is established within the Department of 

Transportation a program to be known as the ``Conserve by Bicycling 

Program''.

 (c) Projects.--

 (1) In general.--In carrying out the program, the Secretary 

 shall establish not more than 10 pilot projects that are--

 (A) dispersed geographically throughout the United 

 States; and

 (B) designed to conserve energy resources by 

 encouraging the use of bicycles in place of motor 

 vehicles.

 (2) Requirements.--A pilot project described in paragraph 

 (1) shall--

 (A) use education and marketing to convert motor 

 vehicle trips to bicycle trips;

 (B) document project results and energy savings (in 

 estimated units of energy conserved);

 (C) facilitate partnerships among interested parties 

 in at least 2 of the fields of--

[[Page 119 STAT. 829]]

 (i) transportation;

 (ii) law enforcement;

 (iii) education;

 (iv) public health;

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 (v) environment; and

 (vi) energy;

 (D) maximize bicycle facility investments;

 (E) demonstrate methods that may be used in other 

 regions of the United States; and

 (F) facilitate the continuation of ongoing programs 

 that are sustained by local resources.

 (3) Cost sharing.--At least 20 percent of the cost of each 

 pilot project described in paragraph (1) shall be provided from 

 non-Federal sources.

 (d) Energy and Bicycling Research Study.--

 (1) In general.--

 Not <<NOTE: Deadline. Contracts. Reports.>> later than 2 years 

 after the date of enactment of this Act, the Secretary shall 

 enter into a contract with the National Academy of Sciences for, 

 and the National Academy of Sciences shall conduct and submit to 

 Congress a report on, a study on the feasibility of converting 

 motor vehicle trips to bicycle trips.

 (2) Components.--The study shall--

 (A) document the results or progress of the pilot 

 projects under subsection (c);

 (B) determine the type and duration of motor vehicle 

 trips that people in the United States may feasibly make 

 by bicycle, taking into consideration factors such as--

 (i) weather;

 (ii) land use and traffic patterns;

 (iii) the carrying capacity of bicycles; and

 (iv) bicycle infrastructure;

 (C) determine any energy savings that would result 

 from the conversion of motor vehicle trips to bicycle 

 trips;

 (D) include a cost-benefit analysis of bicycle 

 infrastructure investments; and

 (E) include a description of any factors that would 

 encourage more motor vehicle trips to be replaced with 

 bicycle trips.

 (e) Authorization of Appropriations.--There is authorized to be 

appropriated to the Secretary to carry out this section $6,200,000, to 

remain available until expended, of which--

 (1) $5,150,000 shall be used to carry out pilot projects 

 described in subsection (c);

 (2) $300,000 shall be used by the Secretary to coordinate, 

 publicize, and disseminate the results of the program; and

 (3) $750,000 shall be used to carry out subsection (d).

SEC. 756. <<NOTE: 42 USC 16104.>> REDUCTION OF ENGINE IDLING.

 (a) Definitions.--In this section:

 (1) Administrator.--The term ``Administrator'' means the 

 Administrator of the Environmental Protection Agency.

 (2) Advanced truck stop electrification system.--The term 

 ``advanced truck stop electrification system'' means a 

 stationary system that delivers heat, air conditioning, 

 electricity, or communications, and is capable of providing 

 verifiable and auditable evidence of use of those services, to a 

 heavy-duty vehicle and any occupants of the heavy-duty vehicle 

 with or

[[Page 119 STAT. 830]]

 without relying on components mounted onboard the heavy-duty 

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 vehicle for delivery of those services.

 (3) Auxiliary power unit.--The term ``auxiliary power unit'' 

 means an integrated system that--

 (A) provides heat, air conditioning, engine warming, 

 or electricity to components on a heavy-duty vehicle; 

 and

 (B) is certified by the Administrator under part 89 

 of title 40, Code of Federal Regulations (or any 

 successor regulation), as meeting applicable emission 

 standards.

 (4) Heavy-duty vehicle.--The term ``heavy-duty vehicle'' 

 means a vehicle that--

 (A) has a gross vehicle weight rating greater than 

 8,500 pounds; and

 (B) is powered by a diesel engine.

 (5) Idle reduction technology.--The term ``idle reduction 

 technology'' means an advanced truck stop electrification 

 system, auxiliary power unit, or other technology that--

 (A) is used to reduce long-duration idling; and

 (B) allows for the main drive engine or auxiliary 

 refrigeration engine to be shut down.

 (6) Energy conservation technology.--the term ``energy 

 conservation technology'' means any device, system of devices, 

 or equipment that improves the fuel economy.

 (7) Long-duration idling.--

 (A) In general.--The term ``long-duration idling'' 

 means the operation of a main drive engine or auxiliary 

 refrigeration engine, for a period greater than 15 

 consecutive minutes, at a time at which the main drive 

 engine is not engaged in gear.

 (B) Exclusions.--The term ``long-duration idling'' 

 does not include the operation of a main drive engine or 

 auxiliary refrigeration engine during a routine stoppage 

 associated with traffic movement or congestion.

 (b) Idle Reduction Technology Benefits, Programs, and Studies.--

 (1) In general.--Not <<NOTE: Deadline.>> later than 90 days 

 after the date of enactment of this Act, the Administrator 

 shall--

 (A)(i) commence a review of the mobile source air 

 emission models of the Environmental Protection Agency 

 used under the Clean Air Act (42 U.S.C. 7401 et seq.) to 

 determine whether the models accurately reflect the 

 emissions resulting from long-duration idling of heavy-

 duty vehicles and other vehicles and engines; and

 (ii) update those models as the Administrator 

 determines to be appropriate; and

 (B)(i) commence a review of the emission reductions 

 achieved by the use of idle reduction technology; and

 (ii) complete such revisions of the regulations and 

 guidance of the Environmental Protection Agency as the 

 Administrator determines to be appropriate.

 (2) Deadline for completion.--Not later than 180 days after 

 the date of enactment of this Act, the Administrator shall--

 (A) complete the reviews under subparagraphs (A)(i) 

 and (B)(i) of paragraph (1); and

 (B) prepare and make publicly available one or more 

 reports on the results of the reviews.

[[Page 119 STAT. 831]]

 (3) Discretionary inclusions.--The reviews under 

 subparagraphs (A)(i) and (B)(i) of paragraph (1) and the reports 

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 under paragraph (2)(B) may address the potential fuel savings 

 resulting from use of idle reduction technology.

 (4) Idle reduction and energy conservation deployment 

 program.--

 (A) Establishment.--

 (i) In general.--Not <<NOTE: Deadline.>> later 

 than 90 days after the date of enactment of this 

 Act, the Administrator, in consultation with the 

 Secretary of Transportation shall, through the 

 Environmental Protection Agency's SmartWay 

 Transport Partnership, establish a program to 

 support deployment of idle reduction and energy 

 conservation technologies.

 (ii) Priority.--The Administrator shall give 

 priority to the deployment of idle reduction and 

 energy conservation technologies based on the 

 costs and beneficial effects on air quality and 

 ability to lessen the emission of criteria air 

 pollutants.

 (B) Funding.--

 (i) Authorization of appropriations.--There 

 are authorized to be appropriated to the 

 Administrator to carry out subparagraph (A) for 

 the purpose of reducing extended idling from 

 heavy-duty vehicles $19,500,000 for fiscal year 

 2006, $30,000,000 for fiscal year 2007, and 

 $45,000,000 for fiscal year 2008.

 (ii) Locomotives.--There are authorized to be 

 appropriated to the administrator to carry out 

 subparagraph (A) for the purpose of reducing 

 extended idling from locomotives $10,000,000 for 

 fiscal year 2006, $15,000,000 for fiscal year 

 2007, and $20,000,000 for fiscal year 2008.

 (iii) Cost sharing.--Subject to clause (iv), 

 the Administrator shall require at least 50 

 percent of the costs directly and specifically 

 related to any project under this section to be 

 provided from non-Federal sources.

 (iv) Necessary and appropriate reductions.--

 The Administrator may reduce the non-Federal 

 requirement under clause (iii) if the 

 Administrator determines that the reduction is 

 necessary and appropriate to meet the objectives 

 of this section.

 (5) Idling location study.--

 (A) In general.--Not <<NOTE: Deadline.>> later than 

 90 days after the date of enactment of this Act, the 

 Administrator, in consultation with the Secretary of 

 Transportation, shall commence a study to analyze all 

 locations at which heavy-duty vehicles stop for long-

 duration idling, including--

 (i) truck stops;

 (ii) rest areas;

 (iii) border crossings;

 (iv) ports;

 (v) transfer facilities; and

 (vi) private terminals.

 (B) Deadline for completion.--Not later than 180 

 days after the date of enactment of this Act, the 

 Administrator shall--

[[Page 119 STAT. 832]]

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 (i) complete the study under subparagraph (A); 

 and

 (ii) prepare and make publicly available one 

 or more reports of the results of the study.

 (c) Vehicle Weight Exemption.--Section 127(a) of title 23, United 

States Code, is amended--

 (1) by designating the first through eleventh sentences as 

 paragraphs (1) through (11), respectively; and

 (2) by adding at the end the following:

 ``(12) Heavy duty vehicles.--

 ``(A) In general.--Subject to subparagraphs (B) and 

 (C), in order to promote reduction of fuel use and 

 emissions because of engine idling, the maximum gross 

 vehicle weight limit and the axle weight limit for any 

 heavy-duty vehicle equipped with an idle reduction 

 technology shall be increased by a quantity necessary to 

 compensate for the additional weight of the idle 

 reduction system.

 ``(B) Maximum weight increase.--The weight increase 

 under subparagraph (A) shall be not greater than 400 

 pounds.

 ``(C) Proof.--On request by a regulatory agency or 

 law enforcement agency, the vehicle operator shall 

 provide proof (through demonstration or certification) 

 that--

 ``(i) the idle reduction technology is fully 

 functional at all times; and

 ``(ii) the 400-pound gross weight increase is 

 not used for any purpose other than the use of 

 idle reduction technology described in 

 subparagraph (A).''.

 (d) Report.--Not later than 60 days after the date on which funds 

are initially awarded under this section, and on an annual basis 

thereafter, the Administrator shall submit to Congress a report 

containing--

 (1) an identification of the grant recipients, a description 

 of the projects to be funded and the amount of funding provided; 

 and

 (2) an identification of all other applicants that submitted 

 applications under the program.

SEC. 757. <<NOTE: 42 USC 16105.>> BIODIESEL ENGINE TESTING PROGRAM.

 (a) In General.--Not <<NOTE: Deadline.>> later that 180 days after 

the date of enactment of this Act, the Secretary shall initiate a 

partnership with diesel engine, diesel fuel injection system, and diesel 

vehicle manufacturers and diesel and biodiesel fuel providers, to 

include biodiesel testing in advanced diesel engine and fuel system 

technology.

 (b) Scope.--The program shall provide for testing to determine the 

impact of biodiesel from different sources on current and future 

emission control technologies, with emphasis on--

 (1) the impact of biodiesel on emissions warranty, in-use 

 liability, and antitampering provisions;

 (2) the impact of long-term use of biodiesel on engine 

 operations;

 (3) the options for optimizing these technologies for both 

 emissions and performance when switching between biodiesel and 

 diesel fuel; and

 (4) the impact of using biodiesel in these fueling systems 

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 and engines when used as a blend with 2006 Environmental

[[Page 119 STAT. 833]]

 Protection Agency-mandated diesel fuel containing a maximum of 

 15-parts-per-million sulfur content.

 (c) Report.--Not later than 2 years after the date of enactment of 

this Act, the Secretary shall provide an interim report to Congress on 

the findings of the program, including a comprehensive analysis of 

impacts from biodiesel on engine operation for both existing and 

expected future diesel technologies, and recommendations for ensuring 

optimal emissions reductions and engine performance with biodiesel.

 (d) Authorization of Appropriations.--There are authorized to be 

appropriated $5,000,000 for each of fiscal years 2006 through 2010 to 

carry out this section.

 (e) Definition.--For purposes of this section, the term 

``biodiesel'' means a diesel fuel substitute produced from nonpetroleum 

renewable resources that meets the registration requirements for fuels 

and fuel additives established by the Environmental Protection Agency 

under section 211 of the Clean Air Act (42 U.S.C. 7545) and that meets 

the American Society for Testing and Materials D6751-02a Standard 

Specification for Biodiesel Fuel (B100) Blend Stock for Distillate 

Fuels.

SEC. 758. <<NOTE: 42 USC 16106.>> ULTRA-EFFICIENT ENGINE TECHNOLOGY FOR 

 AIRCRAFT.

 (a) Ultra-Efficient <<NOTE: Contracts.>> Engine Technology 

Partnership.--The Secretary shall enter into a cooperative agreement 

with the National Aeronautics and Space Administration for the 

development of ultra-efficient engine technology for aircraft.

 (b) Performance Objective.--The Secretary shall establish the 

following performance objectives for the program set forth in subsection 

(a):

 (1) A fuel efficiency increase of at least 10 percent.

 (2) A reduction in the impact of landing and takeoff 

 nitrogen oxides emissions on local air quality of 70 percent.

 (3) Exploring advanced concepts, alternate propulsion, and 

 power configurations, including hybrid fuel cell powered 

 systems.

 (4) Exploring the use of alternate fuel in conventional or 

 nonconventional turbine-based systems.

 (c) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary for carrying out this section $50,000,000 

for each of the fiscal years 2006, 2007, 2008, 2009, and 2010.

SEC. 759. FUEL ECONOMY INCENTIVE REQUIREMENTS.

 Section 32905 of title 49, United States Code, is amended by adding 

the following new subsection at the end thereof:

 ``(h) Fuel Economy Incentive Requirements.--In order for any model 

of dual fueled automobile to be eligible to receive the fuel economy 

incentives included in section 32906(a) and (b), a label shall be 

attached to the fuel compartment of each dual fueled automobile of that 

model, notifying that the vehicle can be operated on an alternative fuel 

and on gasoline or diesel, with the form of alternative fuel stated on 

the notice. <<NOTE: Applicability. Effective date.>> This requirement 

applies to dual fueled automobiles manufactured on or after September 1, 

2006.''.

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[[Page 119 STAT. 834]]

 Subtitle E--Automobile Efficiency

SEC. 771. AUTHORIZATION OF APPROPRIATIONS FOR IMPLEMENTATION AND 

 ENFORCEMENT OF FUEL ECONOMY STANDARDS.

 In addition to any other funds authorized by law, there are 

authorized to be appropriated to the National Highway Traffic Safety 

Administration to carry out its obligations with respect to average fuel 

economy standards $3,500,000 for each of the fiscal years 2006 through 

2010.

SEC. 772. EXTENSION OF MAXIMUM FUEL ECONOMY INCREASE FOR ALTERNATIVE 

 FUELED VEHICLES.

 (a) Manufacturing Incentives.--Section 32905 of title 49, United 

States Code, is amended--

 (1) in each of subsections (b) and (d), by striking ``1993-

 2004'' and inserting ``1993-2010'';

 (2) in subsection (f), by striking ``2001'' and inserting 

 ``2007''; and

 (3) in subsection (f)(1), by striking ``2004'' and inserting 

 ``2010''.

 (b) Maximum Fuel Economy Increase.--Subsection (a)(1) of section 

32906 of title 49, United States Code, is amended--

 (1) in subparagraph (A), by striking ``the model years 1993-

 2004'' and inserting ``model years 1993-2010''; and

 (2) in subparagraph (B), by striking ``the model years 2005-

 2008'' and inserting ``model years 2011-2014''.

SEC. 773. STUDY OF FEASIBILITY AND EFFECTS OF REDUCING USE OF FUEL FOR 

 AUTOMOBILES.

 (a) In General.--Not <<NOTE: Deadline.>> later than 30 days after 

the date of the enactment of this Act, the Administrator of the National 

Highway Traffic Safety Administration shall initiate a study of the 

feasibility and effects of reducing by model year 2014, by a significant 

percentage, the amount of fuel consumed by automobiles.

 (b) Subjects of Study.--The study under this section shall include--

 (1) examination of, and recommendation of alternatives to, 

 the policy under current Federal law of establishing average 

 fuel economy standards for automobiles and requiring each 

 automobile manufacturer to comply with average fuel economy 

 standards that apply to the automobiles it manufactures;

 (2) examination of how automobile manufacturers could 

 contribute toward achieving the reduction referred to in 

 subsection (a);

 (3) examination of the potential of fuel cell technology in 

 motor vehicles in order to determine the extent to which such 

 technology may contribute to achieving the reduction referred to 

 in subsection (a); and

 (4) examination of the effects of the reduction referred to 

 in subsection (a) on--

 (A) gasoline supplies;

 (B) the automobile industry, including sales of 

 automobiles manufactured in the United States;

 (C) motor vehicle safety; and

 (D) air quality.

[[Page 119 STAT. 835]]

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 (c) Report.--The Administrator shall submit to Congress a report on 

the findings, conclusion, and recommendations of the study under this 

section by not later than 1 year after the date of the enactment of this 

Act.

SEC. 774. UPDATE TESTING PROCEDURES.

 The Administrator of the Environmental Protection Agency shall 

update or revise the adjustment factors in sections 600.209-85 and 

600.209-95, of the Code of Federal Regulations, CFR Part 600 (1995) Fuel 

Economy Regulations for 1977 and Later Model Year Automobiles to take 

into consideration higher speed limits, faster acceleration rates, 

variations in temperature, use of air conditioning, shorter city test 

cycle lengths, current reference fuels, and the use of other fuel 

depleting features.

 Subtitle F--Federal and State Procurement

SEC. 781. <<NOTE: 42 USC 16121.>> DEFINITIONS.

 In this subtitle:

 (1) Fuel cell.--The term ``fuel cell'' means a device that 

 directly converts the chemical energy of a fuel and an oxidant 

 into electricity by electrochemical processes occurring at 

 separate electrodes in the device.

 (2) Light-duty or heavy-duty vehicle fleet.--The term 

 ``light-duty or heavy-duty vehicle fleet'' does not include any 

 vehicle designed or procured for combat or combat-related 

 missions.

 (3) Stationary; portable.--The terms ``stationary'' and 

 ``portable'', when used in reference to a fuel cell, include--

 (A) continuous electric power; and

 (B) backup electric power.

 (4) Task force.--The term ``Task Force'' means the Hydrogen 

 and Fuel Cell Technical Task Force established under section 806 

 of this Act.

 (5) Technical advisory committee.--The term ``Technical 

 Advisory Committee'' means the independent Technical Advisory 

 Committee selected under section 807 of this Act.

SEC. 782. <<NOTE: 42 USC 16122.>> FEDERAL AND STATE PROCUREMENT OF FUEL 

 CELL VEHICLES AND HYDROGEN ENERGY SYSTEMS.

 (a) Purposes.--The purposes of this section are--

 (1) to stimulate acceptance by the market of fuel cell 

 vehicles and hydrogen energy systems;

 (2) to support development of technologies relating to fuel 

 cell vehicles, public refueling stations, and hydrogen energy 

 systems; and

 (3) to require the Federal government, which is the largest 

 single user of energy in the United States, to adopt those 

 technologies as soon as practicable after the technologies are 

 developed, in conjunction with private industry partners.

 (b) Federal Leases and Purchases.--

 (1) Requirement.--

 (A) In general.--Not <<NOTE: Deadline.>> later than 

 January 1, 2010, the head of any Federal agency that 

 uses a light-duty or heavy-duty vehicle fleet shall 

 lease or purchase fuel cell vehicles

[[Page 119 STAT. 836]]

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 and hydrogen energy systems to meet any applicable 

 energy savings goal described in subsection (c).

 (B) Learning demonstration vehicles.--The Secretary 

 may lease or purchase appropriate vehicles developed 

 under subsections (a)(10) and (b)(1)(A) of section 808 

 to meet the requirement in subparagraph (A).

 (2) Costs of leases and purchases.--

 (A) In general.--The Secretary, in cooperation with 

 the Task Force and the Technical Advisory Committee, 

 shall pay to Federal agencies (or share the cost under 

 interagency agreements) the difference in cost between--

 (i) the cost to the agencies of leasing or 

 purchasing fuel cell vehicles and hydrogen energy 

 systems under paragraph (1); and

 (ii) the cost to the agencies of a feasible 

 alternative to leasing or purchasing fuel cell 

 vehicles and hydrogen energy systems, as 

 determined by the Secretary.

 (B) Competitive costs and management structures.--In 

 carrying out subparagraph (A), the Secretary, in 

 consultation with the agency, may use the General 

 Services Administration or any commercial vendor to 

 ensure--

 (i) a cost-effective purchase of a fuel cell 

 vehicle or hydrogen energy system; or

 (ii) a cost-effective management structure of 

 the lease of a fuel cell vehicle or hydrogen 

 energy system.

 (3) Exception.--

 (A) In general.--If the Secretary determines that 

 the head of an agency described in paragraph (1) cannot 

 find an appropriately efficient and reliable fuel cell 

 vehicle or hydrogen energy system in accordance with 

 paragraph (1), that agency shall be excepted from 

 compliance with paragraph (1).

 (B) Consideration.--In making a determination under 

 subparagraph (A), the Secretary shall consider--

 (i) the needs of the agency; and

 (ii) an evaluation performed by--

 (I) the Task Force; or

 (II) the Technical Advisory 

 Committee.

 (c) Energy Savings Goals.--

 (1) In <<NOTE: Deadlines.>> general.--

 (A) Regulations.--Not later than December 31, 2006, 

 the Secretary shall--

 (i) in cooperation with the Task Force, 

 promulgate regulations for the period of 2008 

 through 2010 that extend and augment energy 

 savings goals for each Federal agency, in 

 accordance with any Executive order issued after 

 March 2000; and

 (ii) promulgate regulations to expand the 

 minimum Federal fleet requirement and credit 

 allowances for fuel cell vehicle systems under 

 section 303 of the Energy Policy Act of 1992 (42 

 U.S.C. 13212).

 (B) Review, evaluation, and new regulations.--Not 

 later than December 31, 2010, the Secretary shall--

 (i) review the regulations promulgated under 

 subparagraph (A);

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 (ii) evaluate any progress made toward 

 achieving energy savings by Federal agencies; and

[[Page 119 STAT. 837]]

 (iii) promulgate new regulations for the 

 period of 2011 through 2015 to achieve additional 

 energy savings by Federal agencies relating to 

 technical and cost-performance standards.

 (2) Offsetting energy savings goals.--An agency that leases 

 or purchases a fuel cell vehicle or hydrogen energy system in 

 accordance with subsection (b)(1) may use that lease or purchase 

 to count toward an energy savings goal of the agency.

 (d) Cooperative Program With State Agencies.--

 (1) In general.--The Secretary may establish a cooperative 

 program with State agencies managing motor vehicle fleets to 

 encourage purchase of fuel cell vehicles by the agencies.

 (2) Incentives.--In carrying out the cooperative program, 

 the Secretary may offer incentive payments to a State agency to 

 assist with the cost of planning, differential purchases, and 

 administration.

 (e) Authorization of Appropriations.--There is authorized to be 

appropriated to carry out this section--

 (1) $15,000,000 for fiscal year 2008;

 (2) $25,000,000 for fiscal year 2009;

 (3) $65,000,000 for fiscal year 2010; and

 (4) such sums as are necessary for each of fiscal years 2011 

 through 2015.

SEC. 783. <<NOTE: 42 USC 16123.>> FEDERAL PROCUREMENT OF STATIONARY, 

 PORTABLE, AND MICRO FUEL CELLS.

 (a) Purposes.--The purposes of this section are--

 (1) to stimulate acceptance by the market of stationary, 

 portable, and micro fuel cells; and

 (2) to support development of technologies relating to 

 stationary, portable, and micro fuel cells.

 (b) Federal Leases and Purchases.--

 (1) In general.--Not <<NOTE: Deadline.>> later than January 

 1, 2006, the head of any Federal agency that uses electrical 

 power from stationary, portable, or microportable devices shall 

 lease or purchase a stationary, portable, or micro fuel cell to 

 meet any applicable energy savings goal described in subsection 

 (c).

 (2) Costs of leases and purchases.--

 (A) In general.--The Secretary, in cooperation with 

 the Task Force and the Technical Advisory Committee, 

 shall pay the cost to Federal agencies (or share the 

 cost under interagency agreements) of leasing or 

 purchasing stationary, portable, and micro fuel cells 

 under paragraph (1).

 (B) Competitive costs and management structures.--In 

 carrying out subparagraph (A), the Secretary, in 

 consultation with the agency, may use the General 

 Services Administration or any commercial vendor to 

 ensure--

 (i) a cost-effective purchase of a stationary, 

 portable, or micro fuel cell; or

 (ii) a cost-effective management structure of 

 the lease of a stationary, portable, or micro fuel 

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 cell.

 (3) Exception.--

 (A) In general.--If the Secretary determines that 

 the head of an agency described in paragraph (1) cannot 

 find an appropriately efficient and reliable stationary, 

 portable,

[[Page 119 STAT. 838]]

 or micro fuel cell in accordance with paragraph (1), 

 that agency shall be excepted from compliance with 

 paragraph (1).

 (B) Consideration.--In making a determination under 

 subparagraph (A), the Secretary shall consider--

 (i) the needs of the agency; and

 (ii) an evaluation performed by--

 (I) the Task Force; or

 (II) the Technical Advisory 

 Committee of the Task Force.

 (c) Energy Savings Goals.--An agency that leases or purchases a 

stationary, portable, or micro fuel cell in accordance with subsection 

(b)(1) may use that lease or purchase to count toward an energy savings 

goal described in section 808 of this Act that is applicable to the 

agency.

 (d) Authorization of Appropriations.--There is authorized to be 

appropriated to carry out this section--

 (1) $20,000,000 for fiscal year 2006;

 (2) $50,000,000 for fiscal year 2007;

 (3) $75,000,000 for fiscal year 2008;

 (4) $100,000,000 for fiscal year 2009;

 (5) $100,000,000 for fiscal year 2010; and

 (6) such sums as are necessary for each of fiscal years 2011 

 through 2015.

 Subtitle G--Diesel Emissions Reduction

SEC. 791. <<NOTE: 42 USC 16131.>> DEFINITIONS.

 In this subtitle:

 (1) Administrator.--The term ``Administrator'' means the 

 Administrator of the Environmental Protection Agency.

 (2) Certified engine configuration.--The term ``certified 

 engine configuration'' means a new, rebuilt, or remanufactured 

 engine configuration--

 (A) that has been certified or verified by--

 (i) the Administrator; or

 (ii) the California Air Resources Board;

 (B) that meets or is rebuilt or remanufactured to a 

 more stringent set of engine emission standards, as 

 determined by the Administrator; and

 (C) in the case of a certified engine configuration 

 involving the replacement of an existing engine or 

 vehicle, an engine configuration that replaced an engine 

 that was--

 (i) removed from the vehicle; and

 (ii) returned to the supplier for 

 remanufacturing to a more stringent set of engine 

 emissions standards or for scrappage.

 (3) Eligible entity.--The term ``eligible entity'' means--

 (A) a regional, State, local, or tribal agency or 

 port authority with jurisdiction over transportation or 

 air quality; and

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 (B) a nonprofit organization or institution that--

 (i) represents or provides pollution reduction 

 or educational services to persons or 

 organizations that own or operate diesel fleets; 

 or

[[Page 119 STAT. 839]]

 (ii) has, as its principal purpose, the 

 promotion of transportation or air quality.

 (4) Emerging technology.--The term ``emerging technology'' 

 means a technology that is not certified or verified by the 

 Administrator or the California Air Resources Board but for 

 which an approvable application and test plan has been submitted 

 for verification to the Administrator or the California Air 

 Resources Board.

 (5) Fleet.--The term ``fleet'' means one or more diesel 

 vehicles or mobile or stationary diesel engines.

 (6) Heavy-duty truck.--The term ``heavy-duty truck'' has the 

 meaning given the term ``heavy duty vehicle'' in section 202 of 

 the Clean Air Act (42 U.S.C. 7521).

 (7) Medium-duty truck.--The term ``medium-duty truck'' has 

 such meaning as shall be determined by the Administrator, by 

 regulation.

 (8) Verified technology.--The term ``verified technology'' 

 means a pollution control technology, including a retrofit 

 technology, advanced truckstop electrification system, or 

 auxiliary power unit, that has been verified by--

 (A) the Administrator; or

 (B) the California Air Resources Board.

SEC. 792. <<NOTE: 42 USC 16132.>> NATIONAL GRANT AND LOAN PROGRAMS.

 (a) In General.--The Administrator shall use 70 percent of the funds 

made available to carry out this subtitle for each fiscal year to 

provide grants and low-cost revolving loans, as determined by the 

Administrator, on a competitive basis, to eligible entities to achieve 

significant reductions in diesel emissions in terms of--

 (1) tons of pollution produced; and

 (2) diesel emissions exposure, particularly from fleets 

 operating in areas designated by the Administrator as poor air 

 quality areas.

 (b) Distribution.--

 (1) In general.--The Administrator shall distribute funds 

 made available for a fiscal year under this subtitle in 

 accordance with this section.

 (2) Fleets.--The Administrator shall provide not less than 

 50 percent of funds available for a fiscal year under this 

 section to eligible entities for the benefit of public fleets.

 (3) Engine configurations and technologies.--

 (A) Certified engine configurations and verified 

 technologies.--The Administrator shall provide not less 

 than 90 percent of funds available for a fiscal year 

 under this section to eligible entities for projects 

 using--

 (i) a certified engine configuration; or

 (ii) a verified technology.

 (B) Emerging technologies.--

 (i) In general.--The Administrator shall 

 provide not more than 10 percent of funds 

 available for a fiscal year under this section to 

 eligible entities for the development and 

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 commercialization of emerging technologies.

 (ii) Application and test plan.--To receive 

 funds under clause (i), a manufacturer, in 

 consultation with an eligible entity, shall submit 

 for verification to the Administrator or the 

 California Air Resources Board

[[Page 119 STAT. 840]]

 a test plan for the emerging technology, together 

 with the application under subsection (c).

 (c) Applications.--

 (1) In general.--To receive a grant or loan under this 

 section, an eligible entity shall submit to the Administrator an 

 application at a time, in a manner, and including such 

 information as the Administrator may require.

 (2) Inclusions.--An application under this subsection shall 

 include--

 (A) a description of the air quality of the area 

 served by the eligible entity;

 (B) the quantity of air pollution produced by the 

 diesel fleets in the area served by the eligible entity;

 (C) a description of the project proposed by the 

 eligible entity, including--

 (i) any certified engine configuration, 

 verified technology, or emerging technology to be 

 used or funded by the eligible entity; and

 (ii) the means by which the project will 

 achieve a significant reduction in diesel 

 emissions;

 (D) an evaluation (using methodology approved by the 

 Administrator or the National Academy of Sciences) of 

 the quantifiable and unquantifiable benefits of the 

 emissions reductions of the proposed project;

 (E) an estimate of the cost of the proposed project;

 (F) a description of the age and expected lifetime 

 control of the equipment used or funded by the eligible 

 entity;

 (G) a description of the diesel fuel available in 

 the areas to be served by the eligible entity, including 

 the sulfur content of the fuel; and

 (H) provisions for the monitoring and verification 

 of the project.

 (3) Priority.--In providing a grant or loan under this 

 section, the Administrator shall give priority to proposed 

 projects that, as determined by the Administrator--

 (A) maximize public health benefits;

 (B) are the most cost-effective;

 (C) serve areas--

 (i) with the highest population density;

 (ii) that are poor air quality areas, 

 including areas identified by the Administrator 

 as--

 (I) in nonattainment or maintenance 

 of national ambient air quality 

 standards for a criteria pollutant;

 (II) Federal Class I areas; or

 (III) areas with toxic air pollutant 

 concerns;

 (iii) that receive a disproportionate quantity 

 of air pollution from a diesel fleets, including 

 truckstops, ports, rail yards, terminals, and 

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 distribution centers; or

 (iv) that use a community-based 

 multistakeholder collaborative process to reduce 

 toxic emissions;

 (D) include a certified engine configuration, 

 verified technology, or emerging technology that has a 

 long expected useful life;

[[Page 119 STAT. 841]]

 (E) will maximize the useful life of any certified 

 engine configuration, verified technology, or emerging 

 technology used or funded by the eligible entity;

 (F) conserve diesel fuel; and

 (G) use diesel fuel with a sulfur content of less 

 than or equal to 15 parts per million, as the 

 Administrator determines to be appropriate.

 (d) Use of Funds.--

 (1) In general.--An eligible entity may use a grant or loan 

 provided under this section to fund the costs of--

 (A) a retrofit technology (including any incremental 

 costs of a repowered or new diesel engine) that 

 significantly reduces emissions through development and 

 implementation of a certified engine configuration, 

 verified technology, or emerging technology for--

 (i) a bus;

 (ii) a medium-duty truck or a heavy-duty 

 truck;

 (iii) a marine engine;

 (iv) a locomotive; or

 (v) a nonroad engine or vehicle used in--

 (I) construction;

 (II) handling of cargo (including at 

 a port or airport);

 (III) agriculture;

 (IV) mining; or

 (V) energy production; or

 (B) programs or projects to reduce long-duration 

 idling using verified technology involving a vehicle or 

 equipment described in subparagraph (A).

 (2) Regulatory programs.--

 (A) In general.--Notwithstanding paragraph (1), no 

 grant or loan provided under this section shall be used 

 to fund the costs of emissions reductions that are 

 mandated under Federal, State or local law.

 (B) Mandated.--For purposes of subparagraph (A), 

 voluntary or elective emission reduction measures shall 

 not be considered ``mandated'', regardless of whether 

 the reductions are included in the State implementation 

 plan of a State.

SEC. 793. <<NOTE: 42 USC 16133.>> STATE GRANT AND LOAN PROGRAMS.

 (a) In General.--Subject to the availability of adequate 

appropriations, the Administrator shall use 30 percent of the funds made 

available for a fiscal year under this subtitle to support grant and 

loan programs administered by States that are designed to achieve 

significant reductions in diesel emissions.

 (b) Applications.--The Administrator shall--

 (1) <<NOTE: Guidelines.>> provide to States guidance for use 

 in applying for grant or loan funds under this section, 

 including information regarding--

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 (A) the process and forms for applications;

 (B) permissible uses of funds received; and

 (C) the cost-effectiveness of various emission 

 reduction technologies eligible to be carried out using 

 funds provided under this section; and

 (2) <<NOTE: Procedures.>> establish, for applications 

 described in paragraph (1)--

[[Page 119 STAT. 842]]

 (A) <<NOTE: Deadline.>> an annual deadline for 

 submission of the applications;

 (B) a process by which the Administrator shall 

 approve or disapprove each application; and

 (C) a streamlined process by which a State may renew 

 an application described in paragraph (1) for subsequent 

 fiscal years.

 (c) Allocation of Funds.--

 (1) In general.--For each fiscal year, the Administrator 

 shall allocate among States for which applications are approved 

 by the Administrator under subsection (b)(2)(B) funds made 

 available to carry out this section for the fiscal year.

 (2) Allocation.--Using not more than 20 percent of the funds 

 made available to carry out this subtitle for a fiscal year, the 

 Administrator shall provide to each State described in paragraph 

 (1) for the fiscal year an allocation of funds that is equal 

 to--

 (A) if each of the 50 States qualifies for an 

 allocation, an amount equal to 2 percent of the funds 

 made available to carry out this section; or

 (B) if fewer than 50 States qualifies for an 

 allocation, an amount equal to the amount described in 

 subparagraph (A), plus an additional amount equal to the 

 product obtained by multiplying--

 (i) the proportion that--

 (I) the population of the State; 

 bears to

 (II) the population of all States 

 described in paragraph (1); by

 (ii) the amount of funds remaining after each 

 State described in paragraph (1) receives the 2-

 percent allocation under this paragraph.

 (3) State matching incentive.--

 (A) In general.--If a State agrees to match the 

 allocation provided to the State under paragraph (2) for 

 a fiscal year, the Administrator shall provide to the 

 State for the fiscal year an additional amount equal to 

 50 percent of the allocation of the State under 

 paragraph (2).

 (B) Requirements.--A State--

 (i) may not use funds received under this 

 subtitle to pay a matching share required under 

 this subsection; and

 (ii) shall not be required to provide a 

 matching share for any additional amount received 

 under subparagraph (A).

 (4) Unclaimed funds.--Any funds that are not claimed by a 

 State for a fiscal year under this subsection shall be used to 

 carry out section 792.

 (d) Administration.--

 (1) In general.--Subject to paragraphs (2) and (3) and, to 

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 the extent practicable, the priority areas listed in section 

 792(c)(3), a State shall use any funds provided under this 

 section to develop and implement such grant and low-cost 

 revolving loan programs in the State as are appropriate to meet 

 State needs and goals relating to the reduction of diesel 

 emissions.

[[Page 119 STAT. 843]]

 (2) Apportionment of funds.--The Governor of a State that 

 receives funding under this section may determine the portion of 

 funds to be provided as grants or loans.

 (3) Use of funds.--A grant or loan provided under this 

 section may be used for a project relating to--

 (A) a certified engine configuration; or

 (B) a verified technology.

SEC. 794. <<NOTE: 42 USC 16134.>> EVALUATION AND REPORT.

 (a) In General.--Not later than 1 year after the date on which funds 

are made available under this subtitle, and biennially thereafter, the 

Administrator shall submit to Congress a report evaluating the 

implementation of the programs under this subtitle.

 (b) Inclusions.--The report shall include a description of--

 (1) the total number of grant applications received;

 (2) each grant or loan made under this subtitle, including 

 the amount of the grant or loan;

 (3) each project for which a grant or loan is provided under 

 this subtitle, including the criteria used to select the grant 

 or loan recipients;

 (4) the actual and estimated air quality and diesel fuel 

 conservation benefits, cost-effectiveness, and cost-benefits of 

 the grant and loan programs under this subtitle;

 (5) the problems encountered by projects for which a grant 

 or loan is provided under this subtitle; and

 (6) any other information the Administrator considers to be 

 appropriate.

SEC. 795. <<NOTE: 42 USC 16135.>> OUTREACH AND INCENTIVES.

 (a) Definition of Eligible Technology.--In this section, the term 

``eligible technology'' means--

 (1) a verified technology; or

 (2) an emerging technology.

 (b) Technology Transfer Program.--

 (1) In general.--The Administrator shall establish a program 

 under which the Administrator--

 (A) informs stakeholders of the benefits of eligible 

 technologies; and

 (B) develops nonfinancial incentives to promote the 

 use of eligible technologies.

 (2) Eligible stakeholders.--Eligible stakeholders under this 

 section include--

 (A) equipment owners and operators;

 (B) emission and pollution control technology 

 manufacturers;

 (C) engine and equipment manufacturers;

 (D) State and local officials responsible for air 

 quality management;

 (E) community organizations; and

 (F) public health, educational, and environmental 

 organizations.

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 (c) State Implementation Plans.--

The <<NOTE: Guidelines.>> Administrator shall develop appropriate 

guidance to provide credit to a State for emission reductions in the 

State created by the use of eligible technologies through a State 

implementation plan under section 110 of the Clean Air Act (42 U.S.C. 

7410).

 (d) International Markets.--The Administrator, in coordination with 

the Department of Commerce and industry stakeholders,

[[Page 119 STAT. 844]]

shall inform foreign countries with air quality problems of the 

potential of technology developed or used in the United States to 

provide emission reductions in those countries.

SEC. 796. <<NOTE: 42 USC 16136.>> EFFECT OF SUBTITLE.

 Nothing in this subtitle affects any authority under the Clean Air 

Act (42 U.S.C. 7401 et seq.) in existence on the day before the date of 

enactment of this Act.

SEC. 797. <<NOTE: 42 USC 16137.>> AUTHORIZATION OF APPROPRIATIONS.

 There is authorized to be appropriated to carry out this subtitle 

$200,000,000 for each of fiscal years 2007 through 2011, to remain 

available until expended.

TITLE <<NOTE: Spark M. Matsunaga Hydrogen Act of 2005.>> VIII--HYDROGEN

SEC. 801. <<NOTE: 42 USC 15801 note.>> HYDROGEN AND FUEL CELL PROGRAM.

 This title may be cited as the ``Spark M. Matsunaga Hydrogen Act of 

2005''.

SEC. 802. <<NOTE: 42 USC 16151.>> PURPOSES.

 The purposes of this title are--

 (1) to enable and promote comprehensive development, 

 demonstration, and commercialization of hydrogen and fuel cell 

 technology in partnership with industry;

 (2) to make critical public investments in building strong 

 links to private industry, institutions of higher education, 

 National Laboratories, and research institutions to expand 

 innovation and industrial growth;

 (3) to build a mature hydrogen economy that creates fuel 

 diversity in the massive transportation sector of the United 

 States;

 (4) to sharply decrease the dependency of the United States 

 on imported oil, eliminate most emissions from the 

 transportation sector, and greatly enhance our energy security; 

 and

 (5) to create, strengthen, and protect a sustainable 

 national energy economy.

SEC. 803. <<NOTE: 42 USC 16152.>> DEFINITIONS.

 In this title:

 (1) Fuel cell.--The term ``fuel cell'' means a device that 

 directly converts the chemical energy of a fuel, which is 

 supplied from an external source, and an oxidant into 

 electricity by electrochemical processes occurring at separate 

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 electrodes in the device.

 (2) Heavy-duty vehicle.--The term ``heavy-duty vehicle'' 

 means a motor vehicle that--

 (A) is rated at more than 8,500 pounds gross vehicle 

 weight;

 (B) has a curb weight of more than 6,000 pounds; or

 (C) has a basic vehicle frontal area in excess of 45 

 square feet.

 (3) Infrastructure.--The term ``infrastructure'' means the 

 equipment, systems, or facilities used to produce, distribute, 

 deliver, or store hydrogen (except for onboard storage).

[[Page 119 STAT. 845]]

 (4) Light-duty vehicle.--The term ``light-duty vehicle'' 

 means a motor vehicle that is rated at 8,500 or less pounds 

 gross vehicle weight.

 (5) Stationary; portable.--The terms ``stationary'' and 

 ``portable'', when used in reference to a fuel cell, include--

 (A) continuous electric power; and

 (B) backup electric power.

 (6) Task force.--The term ``Task Force'' means the Hydrogen 

 and Fuel Cell Technical Task Force established under section 

 806.

 (7) Technical advisory committee.--The term ``Technical 

 Advisory Committee'' means the independent Technical Advisory 

 Committee established under section 807.

SEC. 804. <<NOTE: Deadline. 42 USC 16153.>> PLAN.

 Not later than 6 months after the date of enactment of this Act, the 

Secretary shall transmit to Congress a coordinated plan for the programs 

described in this title and any other programs of the Department that 

are directly related to fuel cells or hydrogen. The plan shall describe, 

at a minimum--

 (1) the agenda for the next 5 years for the programs 

 authorized under this title, including the agenda for each 

 activity enumerated in section 805(e);

 (2) the types of entities that will carry out the activities 

 under this title and what role each entity is expected to play;

 (3) the milestones that will be used to evaluate the 

 programs for the next 5 years;

 (4) the most significant technical and nontechnical hurdles 

 that stand in the way of achieving the goals described in 

 section 805, and how the programs will address those hurdles; 

 and

 (5) the policy assumptions that are implicit in the plan, 

 including any assumptions that would affect the sources of 

 hydrogen or the marketability of hydrogen-related products.

SEC. 805. <<NOTE: 42 USC 16154.>> PROGRAMS.

 (a) In General.--The Secretary, in consultation with other Federal 

agencies and the private sector, shall conduct a research and 

development program on technologies relating to the production, 

purification, distribution, storage, and use of hydrogen energy, fuel 

cells, and related infrastructure.

 (b) Goal.--The goal of the program shall be to demonstrate and 

commercialize the use of hydrogen for transportation (in light-duty 

vehicles and heavy-duty vehicles), utility, industrial, commercial, and 

residential applications.

 (c) Focus.--In carrying out activities under this section, the 

Secretary shall focus on factors that are common to the development of 

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hydrogen infrastructure and the supply of vehicle and electric power for 

critical consumer and commercial applications, and that achieve 

continuous technical evolution and cost reduction, particularly for 

hydrogen production, the supply of hydrogen, storage of hydrogen, and 

end uses of hydrogen that--

 (1) steadily increase production, distribution, and end use 

 efficiency and reduce life-cycle emissions;

 (2) resolve critical problems relating to catalysts, 

 membranes, storage, lightweight materials, electronic controls, 

 manufacturability, and other problems that emerge from the 

 program;

[[Page 119 STAT. 846]]

 (3) enhance sources of renewable fuels and biofuels for 

 hydrogen production; and

 (4) enable widespread use of distributed electricity 

 generation and storage.

 (d) Public Education and Research.--In carrying out this section, 

the Secretary shall support enhanced public education and research 

conducted at institutions of higher education in fundamental sciences, 

application design, and systems concepts (including education and 

research relating to materials, subsystems, manufacturability, 

maintenance, and safety) relating to hydrogen and fuel cells.

 (e) Activities.--The Secretary, in partnership with the private 

sector, shall conduct programs to address--

 (1) production of hydrogen from diverse energy sources, 

 including--

 (A) fossil fuels, which may include carbon capture 

 and sequestration;

 (B) hydrogen-carrier fuels (including ethanol and 

 methanol);

 (C) renewable energy resources, including biomass; 

 and

 (D) nuclear energy;

 (2) use of hydrogen for commercial, industrial, and 

 residential electric power generation;

 (3) safe delivery of hydrogen or hydrogen-carrier fuels, 

 including--

 (A) transmission by pipeline and other distribution 

 methods; and

 (B) convenient and economic refueling of vehicles 

 either at central refueling stations or through 

 distributed onsite generation;

 (4) advanced vehicle technologies, including--

 (A) engine and emission control systems;

 (B) energy storage, electric propulsion, and hybrid 

 systems;

 (C) automotive materials; and

 (D) other advanced vehicle technologies;

 (5) storage of hydrogen or hydrogen-carrier fuels, including 

 development of materials for safe and economic storage in 

 gaseous, liquid, or solid form at refueling facilities and 

 onboard vehicles;

 (6) development of safe, durable, affordable, and efficient 

 fuel cells, including fuel-flexible fuel cell power systems, 

 improved manufacturing processes, high-temperature membranes, 

 cost-effective fuel processing for natural gas, fuel cell stack 

 and system reliability, low temperature operation, and cold 

 start capability; and

 (7) the ability of domestic automobile manufacturers to 

 manufacture commercially available competitive hybrid vehicle 

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 technologies in the United States.

 (f) Program Goals.--

 (1) Vehicles.--For vehicles, the goals of the program are--

 (A) to enable a commitment by automakers no later 

 than year 2015 to offer safe, affordable, and 

 technically viable hydrogen fuel cell vehicles in the 

 mass consumer market; and

 (B) to enable production, delivery, and acceptance 

 by consumers of model year 2020 hydrogen fuel cell and 

 other

[[Page 119 STAT. 847]]

 hydrogen-powered vehicles that will have, when compared 

 to light duty vehicles in model year 2005--

 (i) fuel economy that is substantially higher;

 (ii) substantially lower emissions of air 

 pollutants; and

 (iii) equivalent or improved vehicle fuel 

 system crash integrity and occupant protection.

 (2) Hydrogen energy and energy infrastructure.--For hydrogen 

 energy and energy infrastructure, the goals of the program are 

 to enable a commitment not later than 2015 that will lead to 

 infrastructure by 2020 that will provide--

 (A) safe and convenient refueling;

 (B) improved overall efficiency;

 (C) widespread availability of hydrogen from 

 domestic energy sources through--

 (i) production, with consideration of 

 emissions levels;

 (ii) delivery, including transmission by 

 pipeline and other distribution methods for 

 hydrogen; and

 (iii) storage, including storage in surface 

 transportation vehicles;

 (D) hydrogen for fuel cells, internal combustion 

 engines, and other energy conversion devices for 

 portable, stationary, micro, critical needs facilities, 

 and transportation applications; and

 (E) other technologies consistent with the 

 Department's plan.

 (3) Fuel cells.--The goals for fuel cells and their 

 portable, stationary, and transportation applications are to 

 enable--

 (A) safe, economical, and environmentally sound 

 hydrogen fuel cells;

 (B) fuel cells for light duty and other vehicles; 

 and

 (C) other technologies consistent with the 

 Department's plan.

 (g) Funding.--

 (1) In general.--The Secretary shall carry out the programs 

 under this section using a competitive, merit-based review 

 process and consistent with the generally applicable Federal 

 laws and regulations governing awards of financial assistance, 

 contracts, or other agreements.

 (2) Research centers.--Activities under this section may be 

 carried out by funding nationally recognized university-based or 

 Federal laboratory research centers.

 (h) Hydrogen Supply.--There are authorized to be appropriated to 

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carry out projects and activities relating to hydrogen production, 

storage, distribution and dispensing, transport, education and 

coordination, and technology transfer under this section--

 (1) $160,000,000 for fiscal year 2006;

 (2) $200,000,000 for fiscal year 2007;

 (3) $220,000,000 for fiscal year 2008;

 (4) $230,000,000 for fiscal year 2009;

 (5) $250,000,000 for fiscal year 2010; and

 (6) such sums as are necessary for each of fiscal years 2011 

 through 2020.

[[Page 119 STAT. 848]]

 (i) Fuel Cell Technologies.--There are authorized to be appropriated 

to carry out projects and activities relating to fuel cell technologies 

under this section--

 (1) $150,000,000 for fiscal year 2006;

 (2) $160,000,000 for fiscal year 2007;

 (3) $170,000,000 for fiscal year 2008;

 (4) $180,000,000 for fiscal year 2009;

 (5) $200,000,000 for fiscal year 2010; and

 (6) such sums as are necessary for each of fiscal years 2011 

 through 2020.

SEC. 806. <<NOTE: 42 USC 16155.>> HYDROGEN AND FUEL CELL TECHNICAL TASK 

 FORCE.

 (a) Establishment.--Not <<NOTE: Deadline. President.>> later than 

120 days after the date of enactment of this Act, the President shall 

establish an interagency task force chaired by the Secretary with 

representatives from each of the following:

 (1) The Office of Science and Technology Policy within the 

 Executive Office of the President.

 (2) The Department of Transportation.

 (3) The Department of Defense.

 (4) The Department of Commerce (including the National 

 Institute of Standards and Technology).

 (5) The Department of State.

 (6) The Environmental Protection Agency.

 (7) The National Aeronautics and Space Administration.

 (8) Other Federal agencies as the Secretary determines 

 appropriate.

 (b) Duties.--

 (1) Planning.--The Task Force shall work toward--

 (A) a safe, economical, and environmentally sound 

 fuel infrastructure for hydrogen and hydrogen-carrier 

 fuels, including an infrastructure that supports buses 

 and other fleet transportation;

 (B) fuel cells in government and other applications, 

 including portable, stationary, and transportation 

 applications;

 (C) distributed power generation, including the 

 generation of combined heat, power, and clean fuels 

 including hydrogen;

 (D) uniform hydrogen codes, standards, and safety 

 protocols; and

 (E) vehicle hydrogen fuel system integrity safety 

 performance.

 (2) Activities.--The Task Force may organize workshops and 

 conferences, may issue publications, and may create databases to 

 carry out its duties. The Task Force shall--

 (A) foster the exchange of generic, nonproprietary 

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 information and technology among industry, academia, and 

 government;

 (B) develop and maintain an inventory and assessment 

 of hydrogen, fuel cells, and other advanced 

 technologies, including the commercial capability of 

 each technology for the economic and environmentally 

 safe production, distribution, delivery, storage, and 

 use of hydrogen;

 (C) integrate technical and other information made 

 available as a result of the programs and activities 

 under this title;

[[Page 119 STAT. 849]]

 (D) promote the marketplace introduction of 

 infrastructure for hydrogen fuel vehicles; and

 (E) conduct an education program to provide hydrogen 

 and fuel cell information to potential end-users.

 (c) Agency Cooperation.--The heads of all agencies, including those 

whose agencies are not represented on the Task Force, shall cooperate 

with and furnish information to the Task Force, the Technical Advisory 

Committee, and the Department.

SEC. 807. <<NOTE: 42 USC 16156.>> TECHNICAL ADVISORY COMMITTEE.

 (a) Establishment.--The Hydrogen Technical and Fuel Cell Advisory 

Committee is established to advise the Secretary on the programs and 

activities under this title.

 (b) Membership.--

 (1) Members.--The Technical Advisory Committee shall be 

 comprised of not fewer than 12 nor more than 25 members. The 

 members shall be appointed by the Secretary to represent 

 domestic industry, academia, professional societies, government 

 agencies, Federal laboratories, previous advisory panels, and 

 financial, environmental, and other appropriate organizations 

 based on the Department's assessment of the technical and other 

 qualifications of Technical Advisory Committee members and the 

 needs of the Technical Advisory Committee.

 (2) Terms.--The term of a member of the Technical Advisory 

 Committee shall not be more than 3 years. The Secretary may 

 appoint members of the Technical Advisory Committee in a manner 

 that allows the terms of the members serving at any time to 

 expire at spaced intervals so as to ensure continuity in the 

 functioning of the Technical Advisory Committee. A member of the 

 Technical Advisory Committee whose term is expiring may be 

 reappointed.

 (3) Chairperson.--The Technical Advisory Committee shall 

 have a chairperson, who shall be elected by the members from 

 among their number.

 (c) Review.--The Technical Advisory Committee shall review and make 

recommendations to the Secretary on--

 (1) the implementation of programs and activities under this 

 title;

 (2) the safety, economical, and environmental consequences 

 of technologies for the production, distribution, delivery, 

 storage, or use of hydrogen energy and fuel cells; and

 (3) the plan under section 804.

 (d) Response.--

 (1) Consideration of recommendations.--The Secretary shall 

 consider, but need not adopt, any recommendations of the 

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 Technical Advisory Committee under subsection (c).

 (2) Biennial report.--The Secretary shall transmit a 

 biennial report to Congress describing any recommendations made 

 by the Technical Advisory Committee since the previous report. 

 The report shall include a description of how the Secretary has 

 implemented or plans to implement the recommendations, or an 

 explanation of the reasons that a recommendation will not be 

 implemented. The report shall be transmitted along with the 

 President's budget proposal.

 (e) Support.--The Secretary shall provide resources necessary in the 

judgment of the Secretary for the Technical Advisory Committee to carry 

out its responsibilities under this title.

[[Page 119 STAT. 850]]

SEC. 808. <<NOTE: 42 USC 16157.>> DEMONSTRATION.

 (a) In General.--In carrying out the programs under this section, 

the Secretary shall fund a limited number of demonstration projects, 

consistent with this title and a determination of the maturity, costeffectiveness, and environmental impacts of technologies supporting each 

project. In selecting projects under this subsection, the Secretary 

shall, to the extent practicable and in the public interest, select 

projects that--

 (1) involve using hydrogen and related products at existing 

 facilities or installations, such as existing office buildings, 

 military bases, vehicle fleet centers, transit bus authorities, 

 or units of the National Park System;

 (2) depend on reliable power from hydrogen to carry out 

 essential activities;

 (3) lead to the replication of hydrogen technologies and 

 draw such technologies into the marketplace;

 (4) include vehicle, portable, and stationary demonstrations 

 of fuel cell and hydrogen-based energy technologies;

 (5) address the interdependency of demand for hydrogen fuel 

 cell applications and hydrogen fuel infrastructure;

 (6) raise awareness of hydrogen technology among the public;

 (7) facilitate identification of an optimum technology among 

 competing alternatives;

 (8) address distributed generation using renewable sources;

 (9) carry out demonstrations of evolving hydrogen and fuel 

 cell technologies in national parks, remote island areas, and on 

 Indian tribal land, as selected by the Secretary;

 (10) carry out a program to demonstrate developmental 

 hydrogen and fuel cell systems for mobile, portable, and 

 stationary uses, using improved versions of the learning 

 demonstrations program concept of the Department including 

 demonstrations involving--

 (A) light-duty vehicles;

 (B) heavy-duty vehicles;

 (C) fleet vehicles;

 (D) specialty industrial and farm vehicles; and

 (E) commercial and residential portable, continuous, 

 and backup electric power generation;

 (11) in accordance with any code or standards developed in a 

 region, fund prototype, pilot fleet, and infrastructure regional 

 hydrogen supply corridors along the interstate highway system in 

 varied climates across the United States; and

 (12) fund demonstration programs that explore the use of 

 hydrogen blends, hybrid hydrogen, and hydrogen reformed from 

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 powered vehicles.

The Secretary shall give preference to projects which address multiple 

elements contained in paragraphs (1) through (12).

 (b) System Demonstrations.--

 (1) In general.--As a <<NOTE: Grants.>> component of the 

 demonstration program under this section, the Secretary shall 

 provide grants, on a cost share basis as appropriate, to 

 eligible entities (as determined by the Secretary) for use in--

[[Page 119 STAT. 851]]

 (A) devising system design concepts that provide for 

 the use of advanced composite vehicles in programs under 

 section 782 that--

 (i) have as a primary goal the reduction of 

 drive energy requirements;

 (ii) after 2010, add another research and 

 development phase, as defined in subsection (c), 

 including the vehicle and infrastructure 

 partnerships developed under the learning 

 demonstrations program concept of the Department; 

 and

 (iii) are managed through an enhanced 

 FreedomCAR program within the Department that 

 encourages involvement in cost-shared projects by 

 manufacturers and governments; and

 (B) designing a local distributed energy system 

 that--

 (i) incorporates renewable hydrogen 

 production, off-grid electricity production, and 

 fleet applications in industrial or commercial 

 service;

 (ii) integrates energy or applications 

 described in clause (i), such as stationary, 

 portable, micro, and mobile fuel cells, into a 

 high-density commercial or residential building 

 complex or agricultural community; and

 (iii) is managed in cooperation with industry, 

 State, tribal, and local governments, agricultural 

 organizations, and nonprofit generators and 

 distributors of electricity.

 (c) Identification of New Program Requirements.--In carrying out the 

demonstrations under subsection (a), the Secretary, in consultation with 

the Task Force and the Technical Advisory Committee, shall--

 (1) after 2008 for stationary and portable applications, and 

 after 2010 for vehicles, identify new requirements that refine 

 technological concepts, planning, and applications; and

 (2) during the second phase of the learning demonstrations 

 under subsection (b)(1)(A)(ii), redesign subsequent program work 

 to incorporate those requirements.

 (d) Authorization of Appropriations.--There are authorized to be 

appropriated to carry out this section--

 (1) $185,000,000 for fiscal year 2006;

 (2) $200,000,000 for fiscal year 2007;

 (3) $250,000,000 for fiscal year 2008;

 (4) $300,000,000 for fiscal year 2009;

 (5) $375,000,000 for fiscal year 2010; and

 (6) such sums as are necessary for each of fiscal years 2011 

 through 2020.

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SEC. 809. <<NOTE: 42 USC 16158.>> CODES AND STANDARDS.

 (a) In General.--The <<NOTE: Grants. Contracts.>> Secretary, in 

cooperation with the Task Force, shall provide grants to, or offer to 

enter into contracts with, such professional organizations, public 

service organizations, and government agencies as the Secretary 

determines appropriate to support timely and extensive development of 

safety codes and standards relating to fuel cell vehicles, hydrogen 

energy systems, and stationary, portable, and micro fuel cells.

[[Page 119 STAT. 852]]

 (b) Educational Efforts.--The Secretary shall support educational 

efforts by organizations and agencies described in subsection (a) to 

share information, including information relating to best practices, 

among those organizations and agencies.

 (c) Authorization of Appropriations.--There are authorized to be 

appropriated to carry out this section--

 (1) $4,000,000 for fiscal year 2006;

 (2) $7,000,000 for fiscal year 2007;

 (3) $8,000,000 for fiscal year 2008;

 (4) $10,000,000 for fiscal year 2009;

 (5) $9,000,000 for fiscal year 2010; and

 (6) such sums as are necessary for each of fiscal years 2011 

 through 2020.

SEC. 810. <<NOTE: Applicability. 42 USC 16159.>> DISCLOSURE.

 Section 623 of the Energy Policy Act of 1992 (42 U.S.C. 13293) shall 

apply to any project carried out through a grant, cooperative agreement, 

or contract under this title.

SEC. 811. <<NOTE: 42 USC 16160.>> REPORTS.

 (a) Secretary.--Subject to subsection (c), not later than 2 years 

after the date of enactment of this Act, and triennially thereafter, the 

Secretary shall submit to Congress a report describing--

 (1) activities carried out by the Department under this 

 title, for hydrogen and fuel cell technology;

 (2) measures the Secretary has taken during the preceding 3 

 years to support the transition of primary industry (or a 

 related industry) to a fully commercialized hydrogen economy;

 (3) any change made to the strategy relating to hydrogen and 

 fuel cell technology to reflect the results of a learning 

 demonstrations;

 (4) progress, including progress in infrastructure, made 

 toward achieving the goal of producing and deploying not less 

 than--

 (A) 100,000 hydrogen-fueled vehicles in the United 

 States by 2010; and

 (B) 2,500,000 hydrogen-fueled vehicles in the United 

 States by 2020;

 (5) progress made toward achieving the goal of supplying 

 hydrogen at a sufficient number of fueling stations in the 

 United States by 2010 including by integrating--

 (A) hydrogen activities; and

 (B) associated targets and timetables for the 

 development of hydrogen technologies;

 (6) any problem relating to the design, execution, or 

 funding of a program under this title;

 (7) progress made toward and goals achieved in carrying out 

 this title and updates to the developmental roadmap, including 

 the results of the reviews conducted by the National Academy of 

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 Sciences under subsection (b) for the fiscal years covered by 

 the report; and

 (8) any updates to strategic plans that are necessary to 

 meet the goals described in paragraph (4).

 (b) External Review.--The <<NOTE: Deadlines.>> Secretary shall enter 

into an arrangement with the National Academy of Sciences under which 

the Academy will review the programs under sections 805 and 808 every 

fourth year following the date of enactment of this Act. The Academy's 

review shall include the program priorities and

[[Page 119 STAT. 853]]

technical milestones, and evaluate the progress toward achieving them. 

The first review shall be completed not later than 5 years after the 

date of enactment of this Act. Not later than 45 days after receiving 

the review, the Secretary shall transmit the review to Congress along 

with a plan to implement the review's recommendations or an explanation 

for the reasons that a recommendation will not be implemented.

 (c) Authorization of Appropriations.--There is authorized to be 

appropriated to carry out this section $1,500,000 for each of fiscal 

years 2006 through 2020.

SEC. 812. <<NOTE: 42 USC 16161.>> SOLAR AND WIND TECHNOLOGIES.

 (a) Solar Energy Technologies.--The Secretary shall--

 (1) prepare a detailed roadmap for carrying out the 

 provisions in this title related to solar energy technologies 

 and for implementing the recommendations related to solar energy 

 technologies that are included in the report transmitted under 

 subsection (e);

 (2) provide for the establishment of 5 projects in 

 geographic areas that are regionally and climatically diverse to 

 demonstrate the production of hydrogen at solar energy 

 facilities, including one demonstration project at a National 

 Laboratory or institution of higher education;

 (3) establish a program--

 (A) to develop optimized concentrating solar power 

 devices that may be used for the production of both 

 electricity and hydrogen; and

 (B) to evaluate the use of thermochemical cycles for 

 hydrogen production at the temperatures attainable with 

 concentrating solar power devices;

 (4) coordinate with activities sponsored by the Department's 

 Office of Nuclear Energy, Science, and Technology on high-

 temperature materials, thermochemical cycles, and economic 

 issues related to solar energy;

 (5) provide for the construction and operation of new 

 concentrating solar power devices or solar power cogeneration 

 facilities that produce hydrogen either concurrently with, or 

 independently of, the production of electricity;

 (6) support existing facilities and programs of study 

 related to concentrating solar power devices; and

 (7) establish a program--

 (A) to develop methods that use electricity from 

 photovoltaic devices for the onsite production of 

 hydrogen, such that no intermediate transmission or 

 distribution infrastructure is required or used and 

 future demand growth may be accommodated;

 (B) to evaluate the economics of small-scale 

 electrolysis for hydrogen production; and

 (C) to study the potential of modular photovoltaic 

 devices for the development of a hydrogen 

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 infrastructure, the security implications of a hydrogen 

 infrastructure, and the benefits potentially derived 

 from a hydrogen infrastructure.

 (b) Wind Energy Technologies.--The Secretary shall--

 (1) prepare a detailed roadmap for carrying out the 

 provisions in this title related to wind energy technologies and 

 for implementing the recommendations related to wind energy

[[Page 119 STAT. 854]]

 technologies that are included in the report transmitted under 

 subsection (e); and

 (2) provide for the establishment of 5 projects in 

 geographic areas that are regionally and climatically diverse to 

 demonstrate the production of hydrogen at existing wind energy 

 facilities, including one demonstration project at a National 

 Laboratory or institution of higher education.

 (c) Program Support.--The Secretary shall support programs at 

institutions of higher education for the development of solar energy 

technologies and wind energy technologies for the production of 

hydrogen. The programs supported under this subsection shall--

 (1) enhance fellowship and faculty assistance programs;

 (2) provide support for fundamental research;

 (3) encourage collaborative research among industry, 

 National Laboratories, and institutions of higher education;

 (4) support communication and outreach; and

 (5) to the greatest extent possible--

 (A) be located in geographic areas that are 

 regionally and climatically diverse; and

 (B) be located at part B institutions, minority 

 institutions, and institutions of higher education 

 located in States participating in the Experimental 

 Program to Stimulate Competitive Research of the 

 Department.

 (d) Institutions of Higher Education and National Laboratory 

Interactions.--In conjunction with the programs supported under this 

section, the Secretary shall develop sabbatical, fellowship, and 

visiting scientist programs to encourage National Laboratories and 

institutions of higher education to share and exchange personnel.

 (e) Report.--The Secretary shall transmit to the Congress not later 

than 120 days after the date of enactment of this Act a report 

containing detailed summaries of the roadmaps prepared under subsections 

(a)(1) and (b)(1), descriptions of the Secretary's progress in 

establishing the projects and other programs required under this 

section, and recommendations for promoting the availability of advanced 

solar and wind energy technologies for the production of hydrogen.

 (f) Definitions.--For purposes of this section--

 (1) the term ``concentrating solar power devices'' means 

 devices that concentrate the power of the sun by reflection or 

 refraction to improve the efficiency of a photovoltaic or 

 thermal generation process;

 (2) the term ``minority institution'' has the meaning given 

 to that term in section 365 of the Higher Education Act of 1965 

 (20 U.S.C. 1067k);

 (3) the term ``part B institution'' has the meaning given to 

 that term in section 322 of the Higher Education Act of 1965 (20 

 U.S.C. 1061); and

 (4) the term ``photovoltaic devices'' means devices that 

 convert light directly into electricity through a solid-state, 

 semiconductor process.

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 (g) Authorization of Appropriations.--There is authorized to be 

appropriated such sums as are necessary for carrying out the activities 

under this section for each of fiscal years 2006 through 2020.

[[Page 119 STAT. 855]]

SEC. 813. <<NOTE: 42 USC 16162.>> TECHNOLOGY TRANSFER.

 In carrying out this title, the Secretary shall carry out programs 

that--

 (1) provide for the transfer of critical hydrogen and fuel 

 cell technologies to the private sector;

 (2) accelerate wider application of those technologies in 

 the global market;

 (3) foster the exchange of generic, nonproprietary 

 information; and

 (4) assess technical and commercial viability of 

 technologies relating to the production, distribution, storage, 

 and use of hydrogen energy and fuel cells.

SEC. 814. <<NOTE: 42 USC 16163.>> MISCELLANEOUS PROVISIONS.

 (a) Representation.--The Secretary may represent the United States 

interests with respect to activities and programs under this title, in 

coordination with the Department of Transportation, the National 

Institute of Standards and Technology, and other relevant Federal 

agencies, before governments and nongovernmental organizations 

including--

 (1) other Federal, State, regional, and local governments 

 and their representatives;

 (2) industry and its representatives, including members of 

 the energy and transportation industries; and

 (3) in consultation with the Department of State, foreign 

 governments and their representatives including international 

 organizations.

 (b) Regulatory Authority.--Nothing in this title shall be construed 

to alter the regulatory authority of the Department.

SEC. 815. <<NOTE: 42 USC 16164.>> COST SHARING.

 The costs of carrying out projects and activities under this title 

shall be shared in accordance with section 988.

SEC. 816. <<NOTE: 42 USC 16165.>> SAVINGS CLAUSE.

 Nothing in this title shall be construed to affect the authority of 

the Secretary of Transportation that may exist prior to the date of 

enactment of this Act with respect to--

 (1) research into, and regulation of, hydrogen-powered 

 vehicles fuel systems integrity, standards, and safety under 

 subtitle VI of title 49, United States Code;

 (2) regulation of hazardous materials transportation under 

 chapter 51 of title 49, United States Code;

 (3) regulation of pipeline safety under chapter 601 of title 

 49, United States Code;

 (4) encouragement and promotion of research, development, 

 and deployment activities relating to advanced vehicle 

 technologies under section 5506 of title 49, United States Code;

 (5) regulation of motor vehicle safety under chapter 301 of 

 title 49, United States Code;

 (6) automobile fuel economy under chapter 329 of title 49, 

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 United States Code; or

 (7) representation of the interests of the United States 

 with respect to the activities and programs under the authority 

 of title 49, United States Code.

[[Page 119 STAT. 856]]

TITLE IX--RESEARCH <<NOTE: Energy Research, Development, Demonstration, 

and Commercial Application Act of 2005.>> AND DEVELOPMENT

SEC. 901. <<NOTE: 42 USC 15801 note.>> SHORT TITLE.

 This title may be cited as the ``Energy Research, Development, 

Demonstration, and Commercial Application Act of 2005''.

SEC. 902. <<NOTE: 42 USC 16181.>> GOALS.

 (a) In General.--In order to achieve the purposes of this title, the 

Secretary shall conduct a balanced set of programs of energy research, 

development, demonstration, and commercial application with the general 

goals of--

 (1) increasing the efficiency of all energy intensive 

 sectors through conservation and improved technologies;

 (2) promoting diversity of energy supply;

 (3) decreasing the dependence of the United States on 

 foreign energy supplies;

 (4) improving the energy security of the United States; and

 (5) decreasing the environmental impact of energy-related 

 activities.

 (b) Goals.--The <<NOTE: Publication.>> Secretary shall publish 

measurable cost and performance-based goals, comparable over time, with 

each annual budget submission in at least the following areas:

 (1) Energy efficiency for buildings, energy-consuming 

 industries, and vehicles.

 (2) Electric energy generation (including distributed 

 generation), transmission, and storage.

 (3) Renewable energy technologies, including wind power, 

 photovoltaics, solar thermal systems, geothermal energy, 

 hydrogen-fueled systems, biomass-based systems, biofuels, and 

 hydropower.

 (4) Fossil energy, including power generation, onshore and 

 offshore oil and gas resource recovery, and transportation 

 fuels.

 (5) Nuclear energy, including programs for existing and 

 advanced reactors, and education of future specialists.

 (c) Public Comment.--The Secretary shall provide mechanisms for 

input on the annually published goals from industry, institutions of 

higher education, and other public sources.

 (d) Effect of Goals.--Nothing in subsection (a) or the annually 

published goals creates any new authority for any Federal agency, or may 

be used by any Federal agency, to support the establishment of 

regulatory standards or regulatory requirements.

SEC. 903. <<NOTE: 42 USC 16182.>> DEFINITIONS.

 In this title:

 (1) Departmental mission.--The term ``departmental mission'' 

 means any of the functions vested in the Secretary by the 

 Department of Energy Organization Act (42 U.S.C. 7101 et seq.) 

 or other law.

 (2) Hispanic-serving institution.--The term ``HispanicPage 270 of 559

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 serving institution'' has the meaning given the term in section 

 502(a) of the Higher Education Act of 1965 (20 U.S.C. 1101a(a)).

 (3) Nonmilitary energy laboratory.--The term ``nonmilitary 

 energy laboratory'' means a National Laboratory other

[[Page 119 STAT. 857]]

 than a National Laboratory listed in subparagraph (G), (H), or 

 (N) of section 2(3).

 (4) Part b institution.--The term ``part B institution'' has 

 the meaning given the term in section 322 of the Higher 

 Education Act of 1965 (20 U.S.C. 1061).

 (5) Single-purpose research facility.--The term ``single-

 purpose research facility'' means--

 (A) any of the primarily single-purpose entities 

 owned by the Department; or

 (B) any other organization of the Department 

 designated by the Secretary.

 (6) University.--The term ``university'' has the meaning 

 given the term ``institution of higher education'' in section 

 101 of the Higher Education Act of 1965 (20 U.S.C. 1001).

 Subtitle A--Energy Efficiency

SEC. 911. <<NOTE: 42 USC 16191.>> ENERGY EFFICIENCY.

 (a) In General.--

 (1) Objectives.--The Secretary shall conduct programs of 

 energy efficiency research, development, demonstration, and 

 commercial application, including activities described in this 

 subtitle. Such programs shall take into consideration the 

 following objectives:

 (A) Increasing the energy efficiency of vehicles, 

 buildings, and industrial processes.

 (B) Reducing the demand of the United States for 

 energy, especially energy from foreign sources.

 (C) Reducing the cost of energy and making the 

 economy more efficient and competitive.

 (D) Improving the energy security of the United 

 States.

 (E) Reducing the environmental impact of energy-

 related activities.

 (2) Programs.--Programs under this subtitle shall include 

 research, development, demonstration, and commercial application 

 of--

 (A) advanced, cost-effective technologies to improve 

 the energy efficiency and environmental performance of 

 vehicles, including--

 (i) hybrid and electric propulsion systems;

 (ii) plug-in hybrid systems;

 (iii) advanced combustion engines;

 (iv) weight and drag reduction technologies;

 (v) whole-vehicle design optimization; and

 (vi) advanced drive trains;

 (B) cost-effective technologies, for new 

 construction and retrofit, to improve the energy 

 efficiency and environmental performance of buildings, 

 using a whole-buildings approach, including onsite 

 renewable energy generation;

 (C) advanced technologies to improve the energy 

 efficiency, environmental performance, and process 

 efficiency of energy-intensive and waste-intensive 

 industries; and

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 (D) advanced control devices to improve the energy 

 efficiency of electric motors, including those used in 

 industrial processes, heating, ventilation, and cooling.

[[Page 119 STAT. 858]]

 (b) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out energy efficiency and 

conservation research, development, demonstration, and commercial 

application activities, including activities authorized under this 

subtitle--

 (1) $783,000,000 for fiscal year 2007;

 (2) $865,000,000 for fiscal year 2008; and

 (3) $952,000,000 for fiscal year 2009.

 (c) Allocations.--From amounts authorized under subsection (b), the 

following sums are authorized:

 (1) For activities under section 912, $50,000,000 for each 

 of fiscal years 2007 through 2009.

 (2) For activities under section 915, $7,000,000 for each of 

 fiscal years 2007 through 2009.

 (3) For activities under subsection (a)(2)(A)--

 (A) $200,000,000 for fiscal year 2007;

 (B) $270,000,000 for fiscal year 2008; and

 (C) $310,000,000 for fiscal year 2009.

 (4) For activities under subsection (a)(2)(D), $2,000,000 

 for each of fiscal years 2007 and 2008.

 (d) Extended Authorization.--There are authorized to be appropriated 

to the Secretary to carry out section 912 $50,000,000 for each of fiscal 

years 2010 through 2013.

 (e) Limitations.--None of the funds authorized to be appropriated 

under this section may be used for--

 (1) the issuance or implementation of energy efficiency 

 regulations;

 (2) the weatherization program established under part A of 

 title IV of the Energy Conservation and Production Act (42 

 U.S.C. 6861 et seq.);

 (3) a State energy conservation plan established under part 

 D of title III of the Energy Policy and Conservation Act (42 

 U.S.C. 6321 et seq.); or

 (4) a Federal energy management measure carried out under 

 part 3 of title V of the National Energy Conservation Policy Act 

 (42 U.S.C. 8251 et seq.).

SEC. 912. <<NOTE: 42 USC 16192.>> NEXT GENERATION LIGHTING INITIATIVE.

 (a) Definitions.--In this section:

 (1) Advanced solid-state lighting.--The term ``advanced 

 solid-state lighting'' means a semiconducting device package and 

 delivery system that produces white light using externally 

 applied voltage.

 (2) Industry alliance.--The term ``Industry Alliance'' means 

 an entity selected by the Secretary under subsection (d).

 (3) Initiative.--The term ``Initiative'' means the Next 

 Generation Lighting Initiative carried out under this section.

 (4) Research.--The term ``research'' includes research on 

 the technologies, materials, and manufacturing processes 

 required for white light emitting diodes.

 (5) White light emitting diode.--The term ``white light 

 emitting diode'' means a semiconducting package, using either 

 organic or inorganic materials, that produces white light using 

 externally applied voltage.

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 (b) Initiative.--The Secretary shall carry out a Next Generation 

Lighting Initiative in accordance with this section to support

[[Page 119 STAT. 859]]

research, development, demonstration, and commercial application 

activities related to advanced solid-state lighting technologies based 

on white light emitting diodes.

 (c) Objectives.--The objectives of the Initiative shall be to 

develop advanced solid-state organic and inorganic lighting technologies 

based on white light emitting diodes that, compared to incandescent and 

fluorescent lighting technologies, are longer lasting, are more energyefficient and cost-competitive, and have less environmental impact.

 (d) Industry Alliance.--Not <<NOTE: Deadline.>> later than 90 days 

after the date of enactment of this Act, the Secretary shall 

competitively select an Industry Alliance to represent participants who 

are private, for-profit firms, open to large and small businesses, that, 

as a group, are broadly representative of United States solid-state 

lighting research, development, infrastructure, and manufacturing 

expertise as a whole.

 (e) Research.--

 (1) Grants.--The Secretary shall carry out the research 

 activities of the Initiative through competitively awarded 

 grants to--

 (A) researchers, including Industry Alliance 

 participants;

 (B) small businesses;

 (C) National Laboratories; and

 (D) institutions of higher education.

 (2) Industry alliance.--The Secretary shall annually solicit 

 from the Industry Alliance--

 (A) comments to identify solid-state lighting 

 technology needs;

 (B) an assessment of the progress of the research 

 activities of the Initiative; and

 (C) assistance in annually updating solid-state 

 lighting technology roadmaps.

 (3) Availability to public.--The information and roadmaps 

 under paragraph (2) shall be available to the public.

 (f) Development, <<NOTE: Grants.>> Demonstration, and Commercial 

Application.--

 (1) In general.--The Secretary shall carry out a 

 development, demonstration, and commercial application program 

 for the Initiative through competitively selected awards.

 (2) Preference.--In making the awards, the Secretary may 

 give preference to participants in the Industry Alliance.

 (g) Cost Sharing.--In carrying out this section, the Secretary shall 

require cost sharing in accordance with section 988.

 (h) Intellectual Property.--The Secretary may require (in accordance 

with section 202(a)(ii) of title 35, United States Code, section 152 of 

the Atomic Energy Act of 1954 (42 U.S.C. 2182), and section 9 of the 

Federal Nonnuclear Energy Research and Development Act of 1974 (42 

U.S.C. 5908)) that for any new invention developed under subsection 

(e)--

 (1) that the Industry Alliance participants who are active 

 participants in research, development, and demonstration 

 activities related to the advanced solid-state lighting 

 technologies that are covered by this section shall be granted 

 the first option to negotiate with the invention owner, at least 

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 in the field of solid-state lighting, nonexclusive licenses and 

 royalties on terms that are reasonable under the circumstances;

[[Page 119 STAT. 860]]

 (2)(A) that, for 1 year after a United States patent is 

 issued for the invention, the patent holder shall not negotiate 

 any license or royalty with any entity that is not a participant 

 in the Industry Alliance described in paragraph (1); and

 (B) that, during the year described in subparagraph (A), the 

 patent holder shall negotiate nonexclusive licenses and 

 royalties in good faith with any interested participant in the 

 Industry Alliance described in paragraph (1); and

 (3) such other terms as the Secretary determines are 

 required to promote accelerated commercialization of inventions 

 made under the Initiative.

 (i) National Academy Review.--The Secretary shall enter into an 

arrangement with the National Academy of Sciences to conduct periodic 

reviews of the Initiative.

SEC. 913. <<NOTE: 42 USC 16193.>> NATIONAL BUILDING PERFORMANCE 

 INITIATIVE.

 (a) Interagency Group.--

 (1) In general.--

 Not <<NOTE: Deadline. Establishment.>> later than 90 days after 

 the date of enactment of this Act, the Director of the Office of 

 Science and Technology Policy shall establish an interagency 

 group to develop, in coordination with the advisory committee 

 established under subsection (e), a National Building 

 Performance Initiative (referred to in this section as the 

 ``Initiative'').

 (2) Cochairs.--The interagency group shall be co-chaired by 

 appropriate officials of the Department and the Department of 

 Commerce, who shall jointly arrange for the provision of 

 necessary administrative support to the group.

 (b) Integration of Efforts.--The Initiative shall integrate Federal, 

State, and voluntary private sector efforts to reduce the costs of 

construction, operation, maintenance, and renovation of commercial, 

industrial, institutional, and residential buildings.

 (c) Plan.--

 (1) In general.--Not <<NOTE: Deadline.>> later than 1 year 

 after the date of enactment of this Act, the interagency group 

 shall submit to Congress a plan for carrying out the appropriate 

 Federal role in the Initiative.

 (2) Inclusions.--The plan shall include--

 (A) research, development, demonstration, and 

 commercial application of energy technology systems and 

 materials for new construction and retrofit relating to 

 the building envelope and building system components;

 (B) research, development, demonstration, and 

 commercial application of energy technology and 

 infrastructure enabling the energy efficient, automated 

 operation of buildings and building equipment; and

 (C) the collection, analysis, and dissemination of 

 research results and other pertinent information on 

 enhancing building performance to industry, government 

 entities, and the public.

 (d) Department of Energy Role.--Within the Federal portion of the 

Initiative, the Department shall be the lead agency for all aspects of 

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building performance related to use and conservation of energy.

 (e) Advisory Committee.--The <<NOTE: Establishment.>> Director of 

the Office of Science and Technology Policy shall establish an advisory 

committee to--

 (1) analyze and provide recommendations on potential private 

 sector roles and participation in the Initiative; and

[[Page 119 STAT. 861]]

 (2) review and provide recommendations on the plan described 

 in subsection (c).

 (f) Administration.--Nothing in this section provides any Federal 

agency with new authority to regulate building performance.

SEC. 914. <<NOTE: 42 USC 16194.>> BUILDING STANDARDS.

 (a) Definition of High Performance Building.--In this section, the 

term ``high performance building'' means a building that integrates and 

optimizes all major high-performance building attributes, including 

energy efficiency, durability, life-cycle performance, and occupant 

productivity.

 (b) Assessment.--Not <<NOTE: Deadline. Contracts.>> later than 120 

days after the date of enactment of this Act, the Secretary shall enter 

into an agreement with the National Institute of Building Sciences to--

 (1) conduct an assessment (in cooperation with industry, 

 standards development organizations, and other entities, as 

 appropriate) of whether the current voluntary consensus 

 standards and rating systems for high performance buildings are 

 consistent with the current technological state of the art, 

 including relevant results from the research, development and 

 demonstration activities of the Department;

 (2) determine if additional research is required, based on 

 the findings of the assessment; and

 (3) recommend steps for the Secretary to accelerate the 

 development of voluntary consensus-based standards for high 

 performance buildings that are based on the findings of the 

 assessment.

 (c) Grant and Technical Assistance Program.--Consistent with 

subsection (b) and section 12(d) of the National Technology Transfer and 

Advancement Act of 1995 (15 U.S.C. 272 note), the Secretary shall 

establish a grant and technical assistance program to support the 

development of voluntary consensus-based standards for high performance 

buildings.

SEC. 915. <<NOTE: 42 USC 16195.>> SECONDARY ELECTRIC VEHICLE BATTERY USE 

 PROGRAM.

 (a) Definitions.--In this section:

 (1) Battery.--The term ``battery'' means an energy storage 

 device that previously has been used to provide motive power in 

 a vehicle powered in whole or in part by electricity.

 (2) Associated equipment.--The term ``associated equipment'' 

 means equipment located where the batteries will be used that is 

 necessary to enable the use of the energy stored in the 

 batteries.

 (b) Program.--

 (1) In general.--The Secretary shall establish and conduct a 

 program of research, development, demonstration, and commercial 

 application of energy technology for the secondary use of 

 batteries, if the Secretary finds that there are sufficient 

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 numbers of batteries to support the program.

 (2) Administration.--The program shall be--

 (A) designed to demonstrate the use of batteries in 

 secondary applications, including utility and commercial 

 power storage and power quality;

 (B) structured to evaluate the performance, 

 including useful service life and costs, of such 

 batteries in field operations, and the necessary 

 supporting infrastructure, including reuse and disposal 

 of batteries; and

[[Page 119 STAT. 862]]

 (C) coordinated with ongoing secondary battery use 

 programs at the National Laboratories and in industry.

 (c) Solicitation.--

 (1) In general.--Not <<NOTE: Deadline.>> later than 180 days 

 after the date of enactment of this Act, the Secretary shall 

 solicit proposals to demonstrate the secondary use of batteries 

 and associated equipment and supporting infrastructure in 

 geographic locations throughout the United States.

 (2) Additional solicitations.--The Secretary may make 

 additional solicitations for proposals if the Secretary 

 determines that the solicitations are necessary to carry out 

 this section.

 (d) Selection of Proposals.--

 (1) In general.--Not <<NOTE: Deadline.>> later than 90 days 

 after the closing date established by the Secretary for receipt 

 of proposals under subsection (c), the Secretary shall select up 

 to five proposals that may receive financial assistance under 

 this section once the Department receives appropriated funds to 

 carry out this section.

 (2) Factors.--In selecting proposals, the Secretary shall 

 consider--

 (A) the diversity of battery type;

 (B) geographic and climatic diversity; and

 (C) life-cycle environmental effects of the 

 approaches.

 (3) Limitation.--No one project selected under this section 

 shall receive more than 25 percent of the funds made available 

 to carry out the program under this section.

 (4) Non-federal involvement.--In selecting proposals, the 

 Secretary shall consider the extent of involvement of State or 

 local government and other persons in each demonstration project 

 to optimize use of Federal resources.

 (5) Other criteria.--In selecting proposals, the Secretary 

 may consider such other criteria as the Secretary considers 

 appropriate.

 (e) Conditions.--In carrying out this section, the Secretary shall 

require that--

 (1) relevant information be provided to--

 (A) the Department;

 (B) the users of the batteries;

 (C) the proposers of a project under this section; 

 and

 (D) the battery manufacturers; and

 (2) the costs of carrying out projects and activities under 

 this section are shared in accordance with section 988.

SEC. 916. <<NOTE: 42 USC 16196.>> ENERGY EFFICIENCY SCIENCE INITIATIVE.

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 (a) Establishment.--The Secretary shall establish an Energy 

Efficiency Science Initiative to be managed by the Assistant Secretary 

in the Department with responsibility for energy conservation under 

section 203(a)(9) of the Department of Energy Organization Act (42 

U.S.C. 7133(a)(9)), in consultation with the Director of the Office of 

Science, for grants to be competitively awarded and subject to peer 

review for research relating to energy efficiency.

 (b) Report.--The Secretary shall submit to Congress, along with the 

annual budget request of the President submitted to Congress, a report 

on the activities of the Energy Efficiency Science Initiative, including 

a description of the process used to award the funds and an explanation 

of how the research relates to energy efficiency.

[[Page 119 STAT. 863]]

SEC. 917. <<NOTE: 42 USC 16197.>> ADVANCED ENERGY EFFICIENCY TECHNOLOGY 

 TRANSFER CENTERS.

 (a) Grants.--Not <<NOTE: Deadline. Establishment.>> later than 18 

months after the date of enactment of this Act, the Secretary shall make 

grants to nonprofit institutions, State and local governments, or 

universities (or consortia thereof), to establish a geographically 

dispersed network of Advanced Energy Efficiency Technology Transfer 

Centers, to be located in areas the Secretary determines have the 

greatest need of the services of such Centers. In establishing the 

network, the Secretary shall consider the special needs and 

opportunities for increased energy efficiency for manufactured and sitebuilt housing.

 (b) Activities.--

 (1) In general.--Each Center shall operate a program to 

 encourage demonstration and commercial application of advanced 

 energy methods and technologies through education and outreach 

 to building and industrial professionals, and to other 

 individuals and organizations with an interest in efficient 

 energy use.

 (2) Advisory panel.--Each <<NOTE: Establishment.>> Center 

 shall establish an advisory panel to advise the Center on how 

 best to accomplish the activities under paragraph (1).

 (c) Application.--A person seeking a grant under this section shall 

submit to the Secretary an application in such form and containing such 

information as the Secretary may require. The Secretary may award a 

grant under this section to an entity already in existence if the entity 

is otherwise eligible under this section.

 (d) Selection Criteria.--The Secretary shall award grants under this 

section on the basis of the following criteria, at a minimum:

 (1) The ability of the applicant to carry out the activities 

 described in subsection (b)(1).

 (2) The extent to which the applicant will coordinate the 

 activities of the Center with other entities, such as State and 

 local governments, utilities, and educational and research 

 institutions.

 (e) Cost-Sharing.--In carrying out this section, the Secretary shall 

require cost-sharing in accordance with the requirements of section 988 

for commercial application activities.

 (f) Advisory Committee.--The <<NOTE: Establishment.>> Secretary 

shall establish an advisory committee to advise the Secretary on the 

establishment of Centers under this section. The advisory committee 

shall be composed of individuals with expertise in the area of advanced 

energy methods and technologies, including at least one representative 

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from--

 (1) State or local energy offices;

 (2) energy professionals;

 (3) trade or professional associations;

 (4) architects, engineers, or construction professionals;

 (5) manufacturers;

 (6) the research community; and

 (7) nonprofit energy or environmental organizations.

 (g) Definitions.--For purposes of this section:

 (1) Advanced energy methods and technologies.--The term 

 ``advanced energy methods and technologies'' means all methods 

 and technologies that promote energy efficiency and 

 conservation, including distributed generation technologies, and 

 life-cycle analysis of energy use.

[[Page 119 STAT. 864]]

 (2) Center.--The term ``Center'' means an Advanced Energy 

 Technology Transfer Center established pursuant to this section.

 (3) Distributed generation.--The term ``distributed 

 generation'' means an electric power generation facility that is 

 designed to serve retail electric consumers at or near the 

 facility site.

 (h) Authorization of Appropriations.--In addition to amounts 

otherwise authorized to be appropriated in section 911, there are 

authorized to be appropriated for the program under this section such 

sums as may be appropriated.

 Subtitle B--Distributed Energy and Electric Energy Systems

SEC. 921. <<NOTE: 42 USC 16211.>> DISTRIBUTED ENERGY AND ELECTRIC ENERGY 

 SYSTEMS.

 (a) In General.--The Secretary shall carry out programs of research, 

development, demonstration, and commercial application on distributed 

energy resources and systems reliability and efficiency, to improve the 

reliability and efficiency of distributed energy resources and systems, 

integrating advanced energy technologies with grid connectivity, 

including activities described in this subtitle. The programs shall 

address advanced energy technologies and systems and advanced grid 

reliability technologies.

 (b) Authorization of Appropriations.--

 (1) Distributed energy and electric energy systems 

 activities.--There are authorized to be appropriated to the 

 Secretary to carry out distributed energy and electric energy 

 systems activities, including activities authorized under this 

 subtitle--

 (A) $240,000,000 for fiscal year 2007;

 (B) $255,000,000 for fiscal year 2008; and

 (C) $273,000,000 for fiscal year 2009.

 (2) Power delivery research initiative.--There are 

 authorized to be appropriated to the Secretary to carry out the 

 Power Delivery Research Initiative under subsection 925(e) such 

 sums as may be necessary for each of fiscal years 2007 through 

 2009.

 (c) Micro-Cogeneration Energy Technology.--From amounts authorized 

under subsection (b), $20,000,000 for each of fiscal years 2007 and 2008 

shall be available to carry out activities under section 923.

 (d) High-Voltage Transmission Lines.--From amounts authorized under 

subsection (b), $2,000,000 for fiscal year 2007 shall be available to 

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carry out activities under section 925(g).

SEC. 922. <<NOTE: 42 USC 16212.>> HIGH POWER DENSITY INDUSTRY PROGRAM.

 (a) In General.--The Secretary shall establish a comprehensive 

research, development, demonstration, and commercial application to 

improve the energy efficiency of high power density facilities, 

including data centers, server farms, and telecommunications facilities.

 (b) Technologies.--The program shall consider technologies that 

provide significant improvement in thermal controls, metering, load 

management, peak load reduction, or the efficient cooling of 

electronics.

[[Page 119 STAT. 865]]

SEC. 923. <<NOTE: 42 USC 16213.>> MICRO-COGENERATION ENERGY TECHNOLOGY.

 (a) In General.--The Secretary shall make competitive, merit-based 

grants to consortia for the development of micro-cogeneration energy 

technology.

 (b) Uses.--The consortia shall explore--

 (1) the use of small-scale combined heat and power in 

 residential heating appliances;

 (2) the use of excess power to operate other appliances 

 within the residence; and

 (3) the supply of excess generated power to the power grid.

SEC. 924. <<NOTE: 42 USC 16214.>> DISTRIBUTED ENERGY TECHNOLOGY 

 DEMONSTRATION PROGRAMS.

 (a) Coordinating Consortia Program.--The Secretary may provide 

financial assistance to coordinating consortia of interdisciplinary 

participants for demonstrations designed to accelerate the use of 

distributed energy technologies (such as fuel cells, microturbines, 

reciprocating engines, thermally activated technologies, and combined 

heat and power systems) in high-energy intensive commercial 

applications.

 (b) Small-Scale Portable Power Program.--

 (1) In general.--The Secretary shall--

 (A) establish a research, development, and 

 demonstration program to develop working models of small 

 scale portable power devices; and

 (B) to the fullest extent practicable, identify and 

 utilize the resources of universities that have shown 

 expertise with respect to advanced portable power 

 devices for either civilian or military use.

 (2) Organization.--The universities identified and utilized 

 under paragraph (1)(B) are authorized to establish an 

 organization to promote small scale portable power devices.

 (3) Definition.--For purposes of this subsection, the term 

 ``small scale portable power device'' means a field-deployable 

 portable mechanical or electromechanical device that can be used 

 for applications such as communications, computation, mobility 

 enhancement, weapons systems, optical devices, cooling, sensors, 

 medical devices, and active biological agent detection systems.

SEC. 925. <<NOTE: 42 USC 16215.>> ELECTRIC TRANSMISSION AND DISTRIBUTION 

 PROGRAMS.

 (a) Program.--The Secretary shall establish a comprehensive 

research, development, and demonstration program to ensure the 

reliability, efficiency, and environmental integrity of electrical 

transmission and distribution systems, which shall include--

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 (1) advanced energy delivery technologies, energy storage 

 technologies, materials, and systems, giving priority to new 

 transmission technologies, including composite conductor 

 materials and other technologies that enhance reliability, 

 operational flexibility, or power-carrying capability;

 (2) advanced grid reliability and efficiency technology 

 development;

 (3) technologies contributing to significant load 

 reductions;

 (4) advanced metering, load management, and control 

 technologies;

 (5) technologies to enhance existing grid components;

[[Page 119 STAT. 866]]

 (6) the development and use of high-temperature 

 superconductors to--

 (A) enhance the reliability, operational 

 flexibility, or power-carrying capability of electric 

 transmission or distribution systems; or

 (B) increase the efficiency of electric energy 

 generation, transmission, distribution, or storage 

 systems;

 (7) integration of power systems, including systems to 

 deliver high-quality electric power, electric power reliability, 

 and combined heat and power;

 (8) supply of electricity to the power grid by small scale, 

 distributed and residential-based power generators;

 (9) the development and use of advanced grid design, 

 operation, and planning tools;

 (10) any other infrastructure technologies, as appropriate; 

 and

 (11) technology transfer and education.

 (b) Program Plan.--

 (1) In general.--Not <<NOTE: Deadline.>> later than 1 year 

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

 consultation with other appropriate Federal agencies, shall 

 prepare and submit to Congress a 5-year program plan to guide 

 activities under this section.

 (2) Consultation.--In preparing the program plan, the 

 Secretary shall consult with--

 (A) utilities;

 (B) energy service providers;

 (C) manufacturers;

 (D) institutions of higher education;

 (E) other appropriate State and local agencies;

 (F) environmental organizations;

 (G) professional and technical societies; and

 (H) any other persons the Secretary considers 

 appropriate.

 (c) Implementation.--The Secretary shall consider implementing the 

program under this section using a consortium of participants from 

industry, institutions of higher education, and National Laboratories.

 (d) Report.--Not later than 2 years after the submission of the plan 

under subsection (b), the Secretary shall submit to Congress a report--

 (1) describing the progress made under this section; and

 (2) identifying any additional resources needed to continue 

 the development and commercial application of transmission and 

 distribution of infrastructure technologies.

 (e) Power Delivery Research Initiative.--

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 (1) In general.--The Secretary shall establish a research, 

 development, and demonstration initiative specifically focused 

 on power delivery using components incorporating high 

 temperature superconductivity.

 (2) Goals.--The goals of the Initiative shall be--

 (A) to establish world-class facilities to develop 

 high temperature superconductivity power applications in 

 partnership with manufacturers and utilities;

 (B) to provide technical leadership for establishing 

 reliability for high temperature superconductivity power 

 applications, including suitable modeling and analysis;

[[Page 119 STAT. 867]]

 (C) to facilitate the commercial transition toward 

 direct current power transmission, storage, and use for 

 high power systems using high temperature 

 superconductivity; and

 (D) to facilitate the integration of very low 

 impedance high temperature superconducting wires and 

 cables in existing electric networks to improve system 

 performance, power flow control, and reliability.

 (3) Inclusions.--The Initiative shall include--

 (A) feasibility analysis, planning, research, and 

 design to construct demonstrations of superconducting 

 links in high power, direct current, and controllable 

 alternating current transmission systems;

 (B) public-private partnerships to demonstrate

 deployment of high temperature superconducting cable 

 into testbeds simulating a realistic transmission grid 

 and under varying transmission conditions, including 

 actual grid insertions; and

 (C) testbeds developed in cooperation with National 

 Laboratories, industries, and institutions of higher 

 education to--

 (i) demonstrate those technologies;

 (ii) prepare the technologies for commercial 

 introduction; and

 (iii) address cost or performance roadblocks 

 to successful commercial use.

 (f) Transmission and Distribution Grid Planning and Operations 

Initiative.--

 (1) In general.--The Secretary shall establish a research, 

 development, and demonstration initiative specifically focused 

 on tools needed to plan, operate, and expand the transmission 

 and distribution grids in the presence of competitive market 

 mechanisms for energy, load demand, customer response, and 

 ancillary services.

 (2) Goals.--The goals of the Initiative shall be--

 (A)(i) to develop and use a geographically 

 distributed center, consisting of institutions of higher 

 education, and National Laboratories, with expertise and 

 facilities to develop the underlying theory and software 

 for power system application; and

 (ii) to ensure commercial development in partnership 

 with software vendors and utilities;

 (B) to provide technical leadership in engineering 

 and economic analysis for the reliability and efficiency 

 of power systems planning and operations in the presence 

 of competitive markets for electricity;

 (C) to model, simulate, and experiment with new 

 market mechanisms and operating practices to understand 

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 and optimize those new methods before actual use; and

 (D) to provide technical support and technology 

 transfer to electric utilities and other participants in 

 the domestic electric industry and marketplace.

 (g) High-voltage <<NOTE: Grants.>> Transmission Lines.--As part of 

the program described in subsection (a), the Secretary shall award a 

grant to a university research program to design and test, in 

consultation with the Tennessee Valley Authority, state-of-the-art 

optimization

[[Page 119 STAT. 868]]

techniques for power flow through existing high voltage transmission 

lines.

 Subtitle C--Renewable Energy

SEC. 931. <<NOTE: 42 USC 16231.>> RENEWABLE ENERGY.

 (a) In General.--

 (1) Objectives.--The Secretary shall conduct programs of 

 renewable energy research, development, demonstration, and 

 commercial application, including activities described in this 

 subtitle. Such programs shall take into consideration the 

 following objectives:

 (A) Increasing the conversion efficiency of all 

 forms of renewable energy through improved technologies.

 (B) Decreasing the cost of renewable energy 

 generation and delivery.

 (C) Promoting the diversity of the energy supply.

 (D) Decreasing the dependence of the United States 

 on foreign energy supplies.

 (E) Improving United States energy security.

 (F) Decreasing the environmental impact of energy-

 related activities.

 (G) Increasing the export of renewable generation 

 equipment from the United States.

 (2) Programs.--

 (A) Solar energy.--The Secretary shall conduct a 

 program of research, development, demonstration, and 

 commercial application for solar energy, including--

 (i) photovoltaics;

 (ii) solar hot water and solar space heating;

 (iii) concentrating solar power;

 (iv) lighting systems that integrate sunlight 

 and electrical lighting in complement to each 

 other in common lighting fixtures for the purpose 

 of improving energy efficiency;

 (v) manufacturability of low cost, high 

 quality solar systems; and

 (vi) development of products that can be 

 easily integrated into new and existing buildings.

 (B) Wind energy.--The Secretary shall conduct a 

 program of research, development, demonstration, and 

 commercial application for wind energy, including--

 (i) low speed wind energy;

 (ii) offshore wind energy;

 (iii) testing and verification (including 

 construction and operation of a research and 

 testing facility capable of testing wind 

 turbines); and

 (iv) distributed wind energy generation.

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 (C) Geothermal.--The Secretary shall conduct a 

 program of research, development, demonstration, and 

 commercial application for geothermal energy. The 

 program shall focus on developing improved technologies 

 for reducing the costs of geothermal energy 

 installations, including technologies for--

 (i) improving detection of geothermal 

 resources;

 (ii) decreasing drilling costs;

[[Page 119 STAT. 869]]

 (iii) decreasing maintenance costs through 

 improved materials;

 (iv) increasing the potential for other 

 revenue sources, such as mineral production; and

 (v) increasing the understanding of reservoir 

 life cycle and management.

 (D) Hydropower.--The Secretary shall conduct a 

 program of research, development, demonstration, and 

 commercial application for cost competitive technologies 

 that enable the development of new and incremental 

 hydropower capacity, adding to the diversity of the 

 energy supply of the United States, including:

 (i) Fish-friendly large turbines.

 (ii) Advanced technologies to enhance 

 environmental performance and yield greater energy 

 efficiencies.

 (E) Miscellaneous projects.--The Secretary shall 

 conduct research, development, demonstration, and 

 commercial application programs for--

 (i) ocean energy, including wave energy;

 (ii) the combined use of renewable energy 

 technologies with one another and with other 

 energy technologies, including the combined use of 

 wind power and coal gasification technologies;

 (iii) renewable energy technologies for 

 cogeneration of hydrogen and electricity; and

 (iv) kinetic hydro turbines.

 (b) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out renewable energy research, 

development, demonstration, and commercial application activities, 

including activities authorized under this subtitle--

 (1) $632,000,000 for fiscal year 2007;

 (2) $743,000,000 for fiscal year 2008; and

 (3) $852,000,000 for fiscal year 2009.

 (c) Bioenergy.--From the amounts authorized under subsection (b), 

there are authorized to be appropriated to carry out section 932--

 (1) $213,000,000 for fiscal year 2007, of which $100,000,000 

 shall be for section 932(d);

 (2) $251,000,000 for fiscal year 2008, of which $125,000,000 

 shall be for section 932(d); and

 (3) $274,000,000 for fiscal year 2009, of which $150,000,000 

 shall be for section 932(d).

 (d) Solar Power.--From amounts authorized under subsection (b), 

there is authorized to be appropriated to carry out activities under 

subsection (a)(2)(A)--

 (1) $140,000,000 for fiscal year 2007, of which $40,000,000 

 shall be for activities under section 935;

 (2) $200,000,000 for fiscal year 2008, of which $50,000,000 

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 shall be for activities under section 935; and

 (3) $250,000,000 for fiscal year 2009, of which $50,000,000 

 shall be for activities under section 935.

 (e) Administration.--Of the funds authorized under subsection (c), 

not less than $5,000,000 for each fiscal year shall be made available 

for grants to--

 (1) part B institutions;

[[Page 119 STAT. 870]]

 (2) Tribal Colleges or Universities (as defined in section 

 316(b) of the Higher Education Act of 1965 (20 U.S.C. 

 1059c(b))); and

 (3) Hispanic-serving institutions.

 (f) Rural Demonstration Projects.--In carrying out this section, the 

Secretary, in consultation with the Secretary of Agriculture, shall 

demonstrate the use of renewable energy technologies to assist in 

delivering electricity to rural and remote locations including --

 (1) advanced wind power technology, including combined use 

 with coal gasification;

 (2) biomass; and

 (3) geothermal energy systems.

 (g) Analysis and Evaluation.--

 (1) In general.--The Secretary shall conduct analysis and 

 evaluation in support of the renewable energy programs under 

 this subtitle. These activities shall be used to guide budget 

 and program decisions, and shall include--

 (A) economic and technical analysis of renewable 

 energy potential, including resource assessment;

 (B) analysis of past program performance, both in 

 terms of technical advances and in market introduction 

 of renewable energy; and

 (C) any other analysis or evaluation that the 

 Secretary considers appropriate.

 (2) Funding.--The Secretary may designate up to 1 percent of 

 the funds appropriated for carrying out this subtitle for 

 analysis and evaluation activities under this subsection.

SEC. 932. <<NOTE: 42 USC 16232.>> BIOENERGY PROGRAM.

 (a) Definitions.--In this section:

 (1) Biomass.--The term ``biomass'' means--

 (A) any organic material grown for the purpose of 

 being converted to energy;

 (B) any organic byproduct of agriculture (including 

 wastes from food production and processing) that can be 

 converted into energy; or

 (C) any waste material that can be converted to 

 energy, is segregated from other waste materials, and is 

 derived from--

 (i) any of the following forest-related 

 resources: mill residues, precommercial thinnings, 

 slash, brush, or otherwise nonmerchantable 

 material; or

 (ii) wood waste materials, including waste 

 pallets, crates, dunnage, manufacturing and 

 construction wood wastes (other than pressure-

 treated, chemically-treated, or painted wood 

 wastes), and landscape or right-of-way tree 

 trimmings, but not including municipal solid 

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 waste, gas derived from the biodegradation of 

 municipal solid waste, or paper that is commonly 

 recycled.

 (2) Lignocellulosic feedstock.--The term ``lignocellulosic 

 feedstock'' means any portion of a plant or coproduct from 

 conversion, including crops, trees, forest residues, and 

 agricultural residues not specifically grown for food, including 

 from barley grain, grapeseed, rice bran, rice hulls, rice straw, 

 soybean matter, and sugarcane bagasse.

[[Page 119 STAT. 871]]

 (b) Program.--The Secretary shall conduct a program of research, 

development, demonstration, and commercial application for bioenergy, 

including--

 (1) biopower energy systems;

 (2) biofuels;

 (3) bioproducts;

 (4) integrated biorefineries that may produce biopower, 

 biofuels, and bioproducts;

 (5) cross-cutting research and development in feedstocks; 

 and

 (6) economic analysis.

 (c) Biofuels and Bioproducts.--The goals of the biofuels and 

bioproducts programs shall be to develop, in partnership with industry 

and institutions of higher education--

 (1) advanced biochemical and thermochemical conversion 

 technologies capable of making fuels from lignocellulosic 

 feedstocks that are price-competitive with gasoline or diesel in 

 either internal combustion engines or fuel cell-powered 

 vehicles;

 (2) advanced biotechnology processes capable of making 

 biofuels and bioproducts with emphasis on development of 

 biorefinery technologies using enzyme-based processing systems;

 (3) advanced biotechnology processes capable of increasing 

 energy production from lignocellulosic feedstocks, with emphasis 

 on reducing the dependence of industry on fossil fuels in 

 manufacturing facilities; and

 (4) other advanced processes that will enable the 

 development of cost-effective bioproducts, including biofuels.

 (d) Integrated Biorefinery Demonstration Projects.--

 (1) In general.--The Secretary shall carry out a program to 

 demonstrate the commercial application of integrated 

 biorefineries. The Secretary shall ensure geographical 

 distribution of biorefinery demonstrations under this 

 subsection. The Secretary shall not provide more than 

 $100,000,000 under this subsection for any single biorefinery 

 demonstration. In making awards under this subsection, the 

 Secretary shall encourage--

 (A) the demonstration of a wide variety of 

 lignocellulosic feedstocks;

 (B) the commercial application of biomass 

 technologies for a variety of uses, including--

 (i) liquid transportation fuels;

 (ii) high-value biobased chemicals;

 (iii) substitutes for petroleum-based 

 feedstocks and products; and

 (iv) energy in the form of electricity or 

 useful heat; and

 (C) the demonstration of the collection and 

 treatment of a variety of biomass feedstocks.

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 (2) Proposals.--Not <<NOTE: Deadline.>> later than 6 months 

 after the date of enactment of this Act, the Secretary shall 

 solicit proposals for demonstration of advanced biorefineries. 

 The Secretary shall select only proposals that--

 (A) demonstrate that the project will be able to 

 operate profitably without direct Federal subsidy after 

 initial construction costs are paid; and

 (B) enable the biorefinery to be easily replicated.

 (e) University Biodiesel Program.--The Secretary shall establish a 

demonstration program to determine the feasibility of

[[Page 119 STAT. 872]]

the operation of diesel electric power generators, using biodiesel fuels 

with ratings as high as B100, at electric generation facilities owned by 

institutions of higher education. The program shall examine--

 (1) heat rates of diesel fuels with large quantities of 

 cellulosic content;

 (2) the reliability of operation of various fuel blends;

 (3) performance in cold or freezing weather;

 (4) stability of fuel after extended storage; and

 (5) other criteria, as determined by the Secretary.

SEC. 933. <<NOTE: 42 USC 16233.>> LOW-COST RENEWABLE HYDROGEN AND 

 INFRASTRUCTURE FOR VEHICLE PROPULSION.

 The Secretary shall--

 (1) establish a research, development, and demonstration 

 program to determine the feasibility of using hydrogen 

 propulsion in light-weight vehicles and the integration of the 

 associated hydrogen production infrastructure using off-the-

 shelf components; and

 (2) identify universities and institutions that--

 (A) have expertise in researching and testing 

 vehicles fueled by hydrogen, methane, and other fuels;

 (B) have expertise in integrating off-the-shelf 

 components to minimize cost; and

 (C) within 2 years can test a vehicle based on an 

 existing commercially available platform with a curb 

 weight of not less than 2,000 pounds before 

 modifications, that--

 (i) operates solely on hydrogen;

 (ii) qualifies as a light-duty passenger 

 vehicle; and

 (iii) uses hydrogen produced from water using 

 only solar energy.

SEC. 934. <<NOTE: 42 USC 16234.>> CONCENTRATING SOLAR POWER RESEARCH 

 PROGRAM.

 (a) In General.--The Secretary shall conduct a program of research 

and development to evaluate the potential for concentrating solar power 

for hydrogen production, including cogeneration approaches for both 

hydrogen and electricity.

 (b) Administration.--The program shall take advantage of existing 

facilities to the extent practicable and shall include--

 (1) development of optimized technologies that are common to 

 both electricity and hydrogen production;

 (2) evaluation of thermochemical cycles for hydrogen 

 production at the temperatures attainable with concentrating 

 solar power;

 (3) evaluation of materials issues for the thermochemical 

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 cycles described in paragraph (2);

 (4) cogeneration of solar thermal electric power and photo-

 synthetic-based hydrogen production;

 (5) system architectures and economics studies; and

 (6) coordination with activities under the Next Generation 

 Nuclear Plant Project established under subtitle C of title VI 

 on high temperature materials, thermochemical cycles, and 

 economic issues.

 (c) Assessment.--In carrying out the program under this section, the 

Secretary shall--

 (1) assess conflicting guidance on the economic potential of 

 concentrating solar power for electricity production received 

 from the National Research Council in the report entitled

[[Page 119 STAT. 873]]

 ``Renewable Power Pathways: A Review of the U.S. Department of 

 Energy's Renewable Energy Programs'' and dated 2000 and 

 subsequent reviews of that report funded by the Department; and

 (2) provide an assessment of the potential impact of 

 technology used to concentrate solar power for electricity 

 before, or concurrent with, submission of the budget for fiscal 

 year 2008.

 (d) Report.--Not later than 5 years after the date of enactment of 

this Act, the Secretary shall provide to Congress a report on the 

economic and technical potential for electricity or hydrogen production, 

with or without cogeneration, with concentrating solar power, including 

the economic and technical feasibility of potential construction of a 

pilot demonstration facility suitable for commercial production of 

electricity or hydrogen from concentrating solar power.

SEC. 935. <<NOTE: 42 USC 16235.>> RENEWABLE ENERGY IN PUBLIC BUILDINGS.

 (a) Demonstration and Technology Transfer Program.--The Secretary 

shall establish a program for the demonstration of innovative 

technologies for solar and other renewable energy sources in buildings 

owned or operated by a State or local government, and for the 

dissemination of information resulting from such demonstration to 

interested parties.

 (b) Limit on Federal Funding.--Notwithstanding section 988, the 

Secretary shall provide under this section no more than 40 percent of 

the incremental costs of the solar or other renewable energy source 

project funded.

 (c) Requirements.--As part of the application for awards under this 

section, the Secretary shall require all applicants---

 (1) to demonstrate a continuing commitment to the use of 

 solar and other renewable energy sources in buildings they own 

 or operate; and

 (2) to state how they expect any award to further their 

 transition to the significant use of renewable energy.

 Subtitle D--Agricultural Biomass Research and Development Programs

SEC. 941. <<NOTE: 7 USC 8101 note.>> AMENDMENTS TO THE BIOMASS RESEARCH 

 AND DEVELOPMENT ACT OF 2000.

 (a) Definitions.--Section 303 of the Biomass Research and 

Development Act of 2000 (Public Law 106-224; 7 U.S.C. 8101 note) is 

amended--

 (1) by striking paragraphs (2), (9), and (10);

 (2) by redesignating paragraphs (3), (4), (5), (6), (7), and 

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 (8) as paragraphs (4), (5), (7), (8), (9), and (10), 

 respectively;

 (3) by inserting after paragraph (1) the following:

 ``(2) Biobased fuel.--The term `biobased fuel' means any 

 transportation fuel produced from biomass.

 ``(3) Biobased product.--The term `biobased product' means 

 an industrial product (including chemicals, materials, and 

 polymers) produced from biomass, or a commercial or industrial 

 product (including animal feed and electric power) derived in 

 connection with the conversion of biomass to fuel.'';

 (4) by inserting after paragraph (5) (as redesignated by 

 paragraph (2)) the following:

[[Page 119 STAT. 874]]

 ``(6) Demonstration.--The term `demonstration' means 

 demonstration of technology in a pilot plant or semi-works scale 

 facility.''; and

 (5) by striking paragraph (9) (as redesignated by paragraph 

 (2)) and inserting the following:

 ``(9) National laboratory.--The term `National Laboratory' 

 has the meaning given that term in section 2 of the Energy 

 Policy Act of 2005.''

 (b) Cooperation and Coordination in Biomass Research and 

Development.--Section 304 of the Biomass Research and Development Act of 

2000 (Public Law 106-224; 7 U.S.C. 8101 note) is amended--

 (1) in subsections (a) and (d), by striking ``industrial 

 products'' each place it appears and inserting ``fuels and 

 biobased products'';

 (2) by striking subsections (b) and (c); and

 (3) by redesignating subsection (d) as subsection (b).

 (c) Biomass Research and Development Board.--Section 305 of the 

Biomass Research and Development Act of 2000 (Public Law 106-224; 7 

U.S.C. 8101 note) is amended--

 (1) in subsections (a) and (c), by striking ``industrial 

 products'' each place it appears and inserting ``fuels and 

 biobased products'';

 (2) in subsection (b)--

 (A) in paragraph (1), by striking ``304(d)(1)(B)'' 

 and inserting ``304(b)(1)(B)''; and

 (B) in paragraph (2), by striking ``304(d)(1)(A)'' 

 and inserting ``304(b)(1)(A)''; and

 (3) in subsection (c)--

 (A) in paragraph (1)(B), by striking ``and'' at the 

 end;

 (B) in paragraph (2), by striking the period at the 

 end and inserting a semicolon; and

 (C) by adding at the end the following:

 ``(3) ensure that--

 ``(A) solicitations are open and competitive with 

 awards made annually; and

 ``(B) objectives and evaluation criteria of the 

 solicitations are clearly stated and minimally 

 prescriptive, with no areas of special interest; and

 ``(4) ensure that the panel of scientific and technical 

 peers assembled under section 307(g)(1)(C) to review proposals 

 is composed predominantly of independent experts selected from 

 outside the Departments of Agriculture and Energy.''.

 (d) Biomass Research and Development Technical Advisory Committee.--

Section 306 of the Biomass Research and Development Act of 2000 (Public 

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Law 106-224; 7 U.S.C. 8101 note) is amended--

 (1) in subsection (b)(1)--

 (A) in subparagraph (A), by striking ``biobased 

 industrial products'' and inserting ``biofuels'';

 (B) by redesignating subparagraphs (B) through (J) 

 as subparagraphs (C) through (K), respectively;

 (C) by inserting after subparagraph (A) the 

 following:

 ``(B) an individual affiliated with the biobased 

 industrial and commercial products industry;'';

[[Page 119 STAT. 875]]

 (D) in subparagraph (F) (as redesignated by 

 subparagraph (B)) by striking ``an individual has'' and 

 inserting ``2 individuals have'';

 (E) in subparagraphs (C), (D), (G), and (I) (as 

 redesignated by subparagraph (B)) by striking 

 ``industrial products'' each place it appears and 

 inserting ``fuels and biobased products''; and

 (F) in subparagraph (H) (as redesignated by 

 subparagraph (B)), by inserting ``and environmental'' 

 before ``analysis'';

 (2) in subsection (c)(2)--

 (A) in subparagraph (A), by striking ``goals'' and 

 inserting ``objectives, purposes, and considerations'';

 (B) by redesignating subparagraphs (B) and (C) as 

 subparagraphs (C) and (D), respectively;

 (C) by inserting after subparagraph (A) the 

 following:

 ``(B) solicitations are open and competitive with 

 awards made annually and that objectives and evaluation 

 criteria of the solicitations are clearly stated and 

 minimally prescriptive, with no areas of special 

 interest;''; and

 (D) in subparagraph (C) (as redesignated by 

 subparagraph (B)) by inserting ``predominantly from 

 outside the Departments of Agriculture and Energy'' 

 after ``technical peers''.

 (e) Biomass Research and Development Initiative.--Section 307 of the 

Biomass Research and Development Act of 2000 (Public Law 106-224; 7 

U.S.C. 8101 note) is amended--

 (1) in subsection (a), by striking ``research on biobased 

 industrial products'' and inserting ``research on, and 

 development and demonstration of, biobased fuels and biobased 

 products, and the methods, practices and technologies, for their 

 production''; and

 (2) by striking subsections (b) through (e) and inserting 

 the following:

 ``(b) Objectives.--The objectives of the Initiative are to develop--

 ``(1) technologies and processes necessary for abundant 

 commercial production of biobased fuels at prices competitive 

 with fossil fuels;

 ``(2) high-value biobased products--

 ``(A) to enhance the economic viability of biobased 

 fuels and power; and

 ``(B) as substitutes for petroleum-based feedstocks 

 and products; and

 ``(3) a diversity of sustainable domestic sources of biomass 

 for conversion to biobased fuels and biobased products.

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 ``(c) Purposes.--The purposes of the Initiative are--

 ``(1) to increase the energy security of the United States;

 ``(2) to create jobs and enhance the economic development of 

 the rural economy;

 ``(3) to enhance the environment and public health; and

 ``(4) to diversify markets for raw agricultural and forestry 

 products.

 ``(d) Technical Areas.--To advance the objectives and purposes of 

the Initiative, the Secretary of Agriculture and the Secretary

[[Page 119 STAT. 876]]

of Energy, in consultation with the Administrator of the Environmental 

Protection Agency and heads of other appropriate departments and 

agencies (referred to in this section as the `Secretaries'), shall 

direct research and development toward--

 ``(1) feedstock production through the development of crops 

 and cropping systems relevant to production of raw materials for 

 conversion to biobased fuels and biobased products, including--

 ``(A) development of advanced and dedicated crops 

 with desired features, including enhanced productivity, 

 broader site range, low requirements for chemical 

 inputs, and enhanced processing;

 ``(B) advanced crop production methods to achieve 

 the features described in subparagraph (A);

 ``(C) feedstock harvest, handling, transport, and 

 storage; and

 ``(D) strategies for integrating feedstock 

 production into existing managed land;

 ``(2) overcoming recalcitrance of cellulosic biomass through 

 developing technologies for converting cellulosic biomass into 

 intermediates that can subsequently be converted into biobased 

 fuels and biobased products, including--

 ``(A) pretreatment in combination with enzymatic or 

 microbial hydrolysis; and

 ``(B) thermochemical approaches, including 

 gasification and pyrolysis;

 ``(3) product diversification through technologies relevant 

 to production of a range of biobased products (including 

 chemicals, animal feeds, and cogenerated power) that eventually 

 can increase the feasibility of fuel production in a 

 biorefinery, including--

 ``(A) catalytic processing, including thermochemical 

 fuel production;

 ``(B) metabolic engineering, enzyme engineering, and 

 fermentation systems for biological production of 

 desired products or cogeneration of power;

 ``(C) product recovery;

 ``(D) power production technologies; and

 ``(E) integration into existing biomass processing 

 facilities, including starch ethanol plants, paper 

 mills, and power plants; and

 ``(4) analysis that provides strategic guidance for the 

 application of biomass technologies in accordance with 

 realization of improved sustainability and environmental 

 quality, cost effectiveness, security, and rural economic 

 development, usually featuring system-wide approaches.

 ``(e) Additional Considerations.--Within the technical areas 

described in subsection (d), and in addition to advancing the purposes 

described in subsection (c) and the objectives described in subsection 

(b), the Secretaries shall support research and development--

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 ``(1) to create continuously expanding opportunities for 

 participants in existing biofuels production by seeking 

 synergies and continuity with current technologies and 

 practices, such as the use of dried distillers grains as a 

 bridge feedstock;

 ``(2) to maximize the environmental, economic, and social 

 benefits of production of biobased fuels and biobased products

[[Page 119 STAT. 877]]

 on a large scale through life-cycle economic and environmental 

 analysis and other means; and

 ``(3) to assess the potential of Federal land and land 

 management programs as feedstock resources for biobased fuels 

 and biobased products, consistent with the integrity of soil and 

 water resources and with other environmental considerations.

 ``(f) Eligible Entities.--To be eligible for a grant, contract, or 

assistance under this section, an applicant shall be--

 ``(1) an institution of higher education;

 ``(2) a National Laboratory;

 ``(3) a Federal research agency;

 ``(4) a State research agency;

 ``(5) a private sector entity;

 ``(6) a nonprofit organization; or

 ``(7) a consortium of two or more entities described in 

 paragraphs (1) through (6).

 ``(g) Administration.--

 ``(1) In general.--After consultation with the Board, the 

 points of contact shall--

 ``(A) publish annually one or more joint requests 

 for proposals for grants, contracts, and assistance 

 under this section;

 ``(B) require that grants, contracts, and assistance 

 under this section be awarded competitively, on the 

 basis of merit, after the establishment of procedures 

 that provide for scientific peer review by an 

 independent panel of scientific and technical peers; and

 ``(C) give some preference to applications that--

 ``(i) involve a consortia of experts from 

 multiple institutions;

 ``(ii) encourage the integration of 

 disciplines and application of the best technical 

 resources; and

 ``(iii) increase the geographic diversity of 

 demonstration projects.

 ``(2) Distribution of funding by technical area.--Of the 

 funds authorized to be appropriated for activities described in 

 this section, funds shall be distributed for each of fiscal 

 years 2007 through 2010 so as to achieve an approximate 

 distribution of--

 ``(A) 20 percent of the funds to carry out 

 activities for feedstock production under subsection 

 (d)(1);

 ``(B) 45 percent of the funds to carry out 

 activities for overcoming recalcitrance of cellulosic 

 biomass under subsection (d)(2);

 ``(C) 30 percent of the funds to carry out 

 activities for product diversification under subsection 

 (d)(3); and

 ``(D) 5 percent of the funds to carry out activities 

 for strategic guidance under subsection (d)(4).

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 ``(3) Distribution of funding within each technical area.--

 Within each technical area described in paragraphs (1) through 

 (3) of subsection (d), funds shall be distributed for each of 

 fiscal years 2007 through 2010 so as to achieve an approximate 

 distribution of--

 ``(A) 15 percent of the funds for applied 

 fundamentals;

 ``(B) 35 percent of the funds for innovation; and

 ``(C) 50 percent of the funds for demonstration.

[[Page 119 STAT. 878]]

 ``(4) Matching funds.--

 ``(A) In general.--A minimum 20 percent funding 

 match shall be required for demonstration projects under 

 this title.

 ``(B) Commercial applications.--A minimum of 50 

 percent funding match shall be required for commercial 

 application projects under this title.

 ``(5) Technology and information transfer to agricultural 

 users.--The Administrator of the Cooperative State Research, 

 Education, and Extension Service and the Chief of the Natural 

 Resources Conservation Service shall ensure that applicable 

 research results and technologies from the Initiative are 

 adapted, made available, and disseminated through those 

 services, as appropriate.''.

 (f) Annual Reports.--Section 309 of the Biomass Research and 

Development Act of 2000 (Public Law 106-224; 7 U.S.C. 8101 note) is 

amended--

 (1) in subsection (b)--

 (A) in paragraph (1)--

 (i) in subparagraph (A), by striking 

 ``purposes described in section 307(b)'' and 

 inserting ``objectives, purposes, and additional 

 considerations described in subsections (b) 

 through (e) of section 307'';

 (ii) in subparagraph (B), by striking ``and'' 

 at the end;

 (iii) by redesignating subparagraph (C) as 

 subparagraph (D); and

 (iv) by inserting after subparagraph (B) the 

 following:

 ``(C) achieves the distribution of funds described 

 in paragraphs (2) and (3) of section 307(g); and''; and

 (B) in paragraph (2), by striking ``industrial 

 products'' and inserting ``fuels and biobased 

 products''; and

 (2) by adding at the end the following:

 ``(c) Updates.--The Secretary and the Secretary of Energy shall 

update the Vision and Roadmap documents prepared for Federal biomass 

research and development activities.''.

 (g) Authorization of Appropriations.--Section 310(b) of the Biomass 

Research and Development Act of 2000 (Public Law 106-224; 7 U.S.C. 8101 

note) is amended by striking ``title $54,000,000 for each of fiscal 

years 2002 through 2007'' and inserting ``title $200,000,000 for each of 

fiscal years 2006 through 2015''.

 (h) Repeal of Sunset Provision.--Section 311 of the Biomass Research 

and Development Act of 2000 (Public Law 106-224; 7 U.S.C. 8101 note) is 

repealed.

SEC. 942. <<NOTE: 42 USC 16251.>> PRODUCTION INCENTIVES FOR CELLULOSIC 

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 BIOFUELS.

 (a) Purpose.--The purpose of this section is to--

 (1) accelerate deployment and commercialization of biofuels;

 (2) deliver the first 1,000,000,000 gallons in annual 

 cellulosic biofuels production by 2015;

 (3) ensure biofuels produced after 2015 are cost competitive 

 with gasoline and diesel; and

 (4) ensure that small feedstock producers and rural small 

 businesses are full participants in the development of the 

 cellulosic biofuels industry.

[[Page 119 STAT. 879]]

 (b) Definitions.--In this section:

 (1) Cellulosic biofuels.--The term ``cellulosic biofuels'' 

 means any fuel that is produced from cellulosic feedstocks.

 (2) Eligible entity.--The term ``eligible entity'' means a 

 producer of fuel from cellulosic biofuels the production 

 facility of which--

 (A) is located in the United States;

 (B) meets all applicable Federal and State 

 permitting requirements; and

 (C) meets any financial criteria established by the 

 Secretary.

 (c) Program.--

 (1) Establishment.--The Secretary, in consultation with the 

 Secretary of Agriculture, the Secretary of Defense, and the 

 Administrator of the Environmental Protection Agency, shall 

 establish an incentive program for the production of cellulosic 

 biofuels.

 (2) Basis of incentives.--Under the program, the Secretary 

 shall award production incentives on a per gallon basis of 

 cellulosic biofuels from eligible entities, through--

 (A) set payments per gallon of cellulosic biofuels 

 produced in an amount determined by the Secretary, until 

 initiation of the first reverse auction; and

 (B) reverse auction thereafter.

 (3) First reverse auction.--The <<NOTE: Deadlines.>> first 

 reverse auction shall be held on the earlier of--

 (A) not later than 1 year after the first year of 

 annual production in the United States of 100,000,000 

 gallons of cellulosic biofuels, as determined by the 

 Secretary; or

 (B) not later than 3 years after the date of 

 enactment of this Act.

 (4) Reverse auction procedure.--

 (A) In general.--On initiation of the first reverse 

 auction, and each year thereafter until the earlier of 

 the first year of annual production in the United States 

 of 1,000,000,000 gallons of cellulosic biofuels, as 

 determined by the Secretary, or 10 years after the date 

 of enactment of this Act, the Secretary shall conduct a 

 reverse auction at which--

 (i) the Secretary shall solicit bids from 

 eligible entities;

 (ii) eligible entities shall submit--

 (I) a desired level of production 

 incentive on a per gallon basis; and

 (II) an estimated annual production 

 amount in gallons; and

 (iii) the Secretary shall issue awards for the 

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 production amount submitted, beginning with the 

 eligible entity submitting the bid for the lowest 

 level of production incentive on a per gallon 

 basis and meeting such other criteria as are 

 established by the Secretary, until the amount of 

 funds available for the reverse auction is 

 committed.

 (B) Amount of incentive received.--An eligible 

 entity selected by the Secretary through a reverse 

 auction shall receive the amount of performance 

 incentive

[[Page 119 STAT. 880]]

 requested in the auction for each gallon produced and 

 sold by the entity during the first 6 years of 

 operation.

 (C) Commencement 

 of <<NOTE: Deadline. Contracts.>> production of 

 cellulosic biofuels.--As a condition of the receipt of 

 an award under this section, an eligible entity shall 

 enter into an agreement with the Secretary under which 

 the eligible entity agrees to begin production of 

 cellulosic biofuels not later than 3 years after the 

 date of the reverse auction in which the eligible entity 

 participates.

 (d) Limitations.--Awards under this section shall be limited to--

 (1) a per gallon amount determined by the Secretary during 

 the first 4 years of the program;

 (2) a declining per gallon cap over the remaining lifetime 

 of the program, to be established by the Secretary so that 

 cellulosic biofuels produced after the first year of annual 

 cellulosic biofuels production in the United States in excess of 

 1,000,000,000 gallons are cost competitive with gasoline and 

 diesel;

 (3) not more than 25 percent of the funds committed within 

 each reverse auction to any 1 project;

 (4) not more than $100,000,000 in any 1 year; and

 (5) not more than $1,000,000,000 over the lifetime of the 

 program.

 (e) Priority.--In selecting a project under the program, the 

Secretary shall give priority to projects that--

 (1) demonstrate outstanding potential for local and regional 

 economic development;

 (2) include agricultural producers or cooperatives of 

 agricultural producers as equity partners in the ventures; and

 (3) have a strategic agreement in place to fairly reward 

 feedstock suppliers.

 (f) Authorizations of Appropriations.--There is authorized to be 

appropriated to carry out this section $250,000,000.

SEC. 943. PROCUREMENT OF BIOBASED PRODUCTS.

 (a) Federal Procurement.--

 (1) Definition of procuring agency.--Section 9001 of the 

 Farm Security and Rural Investment Act of 2002 (7 U.S.C. 8101) 

 is amended--

 (A) by redesignating paragraphs (4), (5), and (6) as 

 paragraphs (5), (6), and (7), respectively; and

 (B) by inserting after paragraph (3) the following:

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 ``(4) Procuring agency.--The term `procuring agency' means--

 ``(A) any Federal agency that is using Federal funds 

 for procurement; or

 ``(B) any person contracting with any Federal agency 

 with respect to work performed under the contract.''.

 (2) Procurement.--Section 9002 of the Farm Security and 

 Rural Investment Act of 2002 (7 U.S.C. 8102) is amended--

 (A) by striking ``Federal agency'' each place it 

 appears (other than in subsections (f) and (g)) and 

 inserting ``procuring agency'';

 (B) in subsection (c)(2)--

 (i) by striking ``(2)'' and all that follows 

 through ``Notwithstanding'' and inserting the 

 following:

[[Page 119 STAT. 881]]

 ``(2) Flexibility.--Notwithstanding'';

 (ii) by striking ``an agency'' and inserting 

 ``a procuring agency''; and

 (iii) by striking ``the agency'' and inserting 

 ``the procuring agency'';

 (C) in subsection (d), by striking ``procured by 

 Federal agencies'' and inserting ``procured by procuring 

 agencies''; and

 (D) in subsection (f), by striking ``Federal 

 agencies'' and inserting ``procuring agencies''.

 (b) Capitol Complex Procurement.--Section 9002 of the Farm Security 

and Rural Investment Act of 2002 (7 U.S.C. 8102) (as amended by 

subsection (a)(2)) is amended--

 (1) by redesignating subsection (j) as subsection (k); and

 (2) by inserting after subsection (i) the following:

 ``(j) Inclusion.--Not <<NOTE: Deadline. Procedures.>> later than 90 

days after the date of enactment of the Energy Policy Act of 2005, the 

Architect of the Capitol, the Sergeant at Arms of the Senate, and the 

Chief Administrative Officer of the House of Representatives shall 

establish procedures that apply the requirements of this section to 

procurement for the Capitol Complex.''.

 (c) <<NOTE: 42 USC 16252.>> Education.--

 (1) In general.--The Architect of the Capitol shall 

 establish in the Capitol Complex a program of public education 

 regarding use by the Architect of the Capitol of biobased 

 products.

 (2) Purposes.--The purposes of the program shall be--

 (A) to establish the Capitol Complex as a showcase 

 for the existence and benefits of biobased products; and

 (B) to provide access to further information on

 biobased products to occupants and visitors.

 (d) Procedure.--Requirements <<NOTE: 7 USC 8102 note.>> issued under 

the amendments made by subsection (b) shall be made in accordance with 

directives issued by the Committee on Rules and Administration of the 

Senate and the Committee on House Administration of the House of 

Representatives.

SEC. 944. <<NOTE: 42 USC 16253.>> SMALL BUSINESS BIOPRODUCT MARKETING 

 AND CERTIFICATION GRANTS.

 (a) In General.--Using amounts made available under subsection (g), 

the Secretary of Agriculture (referred to in this section as the 

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``Secretary'') shall make available on a competitive basis grants to 

eligible entities described in subsection (b) for the biobased product 

marketing and certification purposes described in subsection (c).

 (b) Eligible Entities.--

 (1) In general.--An entity eligible for a grant under this 

 section is any manufacturer of biobased products that--

 (A) proposes to use the grant for the biobased 

 product marketing and certification purposes described 

 in subsection (c); and

 (B) has not previously received a grant under this 

 section.

 (2) Preference.--In making grants under this section, the 

 Secretary shall provide a preference to an eligible entity that 

 has fewer than 50 employees.

[[Page 119 STAT. 882]]

 (c) Biobased Product Marketing and Certification Grant Purposes.--A 

grant made under this section shall be used--

 (1) to provide working capital for marketing of biobased 

 products; and

 (2) to provide for the certification of biobased products 

 to--

 (A) qualify for the label described in section 

 9002(h)(1) of the Farm Security and Rural Investment Act 

 of 2002 (7 U.S.C. 8102(h)(1)); or

 (B) meet other biobased standards determined 

 appropriate by the Secretary.

 (d) Matching Funds.--

 (1) In general.--Grant recipients shall provide matching 

 non-Federal funds equal to the amount of the grant received.

 (2) Expenditure.--Matching funds shall be expended in 

 advance of grant funding, so that for every dollar of grant that 

 is advanced, an equal amount of matching funds shall have been 

 funded prior to submitting the request for reimbursement.

 (e) Amount.--A grant made under this section shall not exceed 

$100,000.

 (f) Administration.--The Secretary shall establish such 

administrative requirements for grants under this section, including 

requirements for applications for the grants, as the Secretary considers 

appropriate.

 (g) Authorizations of Appropriations.--There are authorized to be 

appropriated to make grants under this section--

 (1) $1,000,000 for fiscal year 2006; and

 (2) such sums as are necessary for each of fiscal years 2007 

 through 2015.

SEC. 945. <<NOTE: 42 USC 16254.>> REGIONAL BIOECONOMY DEVELOPMENT 

 GRANTS.

 (a) In General.--Using amounts made available under subsection (g), 

the Secretary of Agriculture (referred to in this section as the 

``Secretary'') shall make available on a competitive basis grants to 

eligible entities described in subsection (b) for the purposes described 

in subsection (c).

 (b) Eligible Entities.--An entity eligible for a grant under this 

section is any regional bioeconomy development association, agricultural 

or energy trade association, or Land Grant institution that--

 (1) proposes to use the grant for the purposes described in 

 subsection (c); and

 (2) has not previously received a grant under this section.

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 (c) Regional Bioeconomy Development Association Grant Purposes.--A 

grant made under this section shall be used to support and promote the 

growth and development of the bioeconomy within the region served by the 

eligible entity, through coordination, education, outreach, and other 

endeavors by the eligible entity.

 (d) Matching Funds.--

 (1) In general.--Grant recipients shall provide matching 

 non-Federal funds equal to the amount of the grant received.

 (2) Expenditure.--Matching funds shall be expended in 

 advance of grant funding, so that for every dollar of grant that 

 is advanced, an equal amount of matching funds shall have been 

 funded prior to submitting the request for reimbursement.

[[Page 119 STAT. 883]]

 (e) Administration.--The <<NOTE: Requirements.>> Secretary shall 

establish such administrative requirements for grants under this 

section, including requirements for applications for the grants, as the 

Secretary considers appropriate.

 (f) Amount.--A grant made under this section shall not exceed 

$500,000.

 (g) Authorizations of Appropriations.--There are authorized to be 

appropriated to make grants under this section--

 (1) $1,000,000 for fiscal year 2006; and

 (2) such sums as are necessary for each of fiscal years 2007 

 through 2015.

SEC. 946. <<NOTE: 42 USC 16255.>> PREPROCESSING AND HARVESTING 

 DEMONSTRATION GRANTS.

 (a) In General.--The Secretary of Agriculture (referred to in this 

section as the ``Secretary'') shall make grants available on a 

competitive basis to enterprises owned by agricultural producers, for 

the purposes of demonstrating cost-effective, cellulosic biomass 

innovations in--

 (1) preprocessing of feedstocks, including cleaning, 

 separating and sorting, mixing or blending, and chemical or 

 biochemical treatments, to add value and lower the cost of 

 feedstock processing at a biorefinery; or

 (2) 1-pass or other efficient, multiple crop harvesting 

 techniques.

 (b) Limitations on Grants.--

 (1) Number of grants.--Not more than 5 demonstration 

 projects per fiscal year shall be funded under this section.

 (2) Non-federal cost share.--The non-Federal cost share of a 

 project under this section shall be not less than 20 percent, as 

 determined by the Secretary.

 (c) Condition of Grant.--To be eligible for a grant for a project 

under this section, a recipient of a grant or a participating entity 

shall agree to use the material harvested under the project--

 (1) to produce ethanol; or

 (2) for another energy purpose, such as the generation of 

 heat or electricity.

 (d) Authorization for Appropriations.--There is authorized to be 

appropriated to carry out this section $5,000,000 for each of fiscal 

years 2006 through 2010.

SEC. 947. <<NOTE: 42 USC 16256.>> EDUCATION AND OUTREACH.

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 (a) In General.--The Secretary of Agriculture shall establish, 

within the Department of Agriculture or through an independent 

contracting entity, a program of education and outreach on biobased 

fuels and biobased products consisting of--

 (1) training and technical assistance programs for feedstock 

 producers to promote producer ownership, investment, and 

 participation in the operation of processing facilities; and

 (2) public education and outreach to familiarize consumers 

 with the biobased fuels and biobased products.

 (b) Authorization of Appropriations.--There is authorized to be 

appropriated to carry out this section $1,000,000 for each of fiscal 

years 2006 through 2010.

SEC. 948. REPORTS.

 (a) Biobased Product Potential.--Not later than 1 year after the 

date of enactment of this Act, the Secretary of Agriculture

[[Page 119 STAT. 884]]

(referred to in this section as the ``Secretary'') shall submit to the 

Committee on Agriculture of the House of Representatives and the 

Committee on Agriculture, Nutrition, and Forestry of the Senate a report 

that--

 (1) describes the economic potential for the United States 

 of the widespread production and use of commercial and 

 industrial biobased products through calendar year 2025; and

 (2) as the maximum extent practicable, identifies the 

 economic potential by product area.

 (b) Analysis of Economic Indicators.--Not <<NOTE: Deadline.>> later 

than 2 years after the date of enactment of this Act, the Secretary 

shall submit to Congress an analysis of economic indicators of the 

biobased economy.

 Subtitle E--Nuclear Energy

SEC. 951. <<NOTE: 42 USC 16271.>> NUCLEAR ENERGY.

 (a) In General.--The Secretary shall conduct programs of civilian 

nuclear energy research, development, demonstration, and commercial 

application, including activities described in this subtitle. Programs 

under this subtitle shall take into consideration the following 

objectives:

 (1) Enhancing nuclear power's viability as part of the 

 United States energy portfolio.

 (2) Providing the technical means to reduce the likelihood 

 of nuclear proliferation.

 (3) Maintaining a cadre of nuclear scientists and engineers.

 (4) Maintaining National Laboratory and university nuclear 

 programs, including their infrastructure.

 (5) Supporting both individual researchers and 

 multidisciplinary teams of researchers to pioneer new approaches 

 in nuclear energy, science, and technology.

 (6) Developing, planning, constructing, acquiring, and 

 operating special equipment and facilities for the use of 

 researchers.

 (7) Supporting technology transfer and other appropriate 

 activities to assist the nuclear energy industry, and other 

 users of nuclear science and engineering, including activities 

 addressing reliability, availability, productivity, component 

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 aging, safety, and security of nuclear power plants.

 (8) Reducing the environmental impact of nuclear energy-

 related activities.

 (b) Authorization of Appropriations for Core Programs.--There are 

authorized to be appropriated to the Secretary to carry out nuclear 

energy research, development, demonstration, and commercial application 

activities, including activities authorized under this subtitle, other 

than those described in subsection (c)--

 (1) $330,000,000 for fiscal year 2007;

 (2) $355,000,000 for fiscal year 2008; and

 (3) $495,000,000 for fiscal year 2009.

 (c) Nuclear Infrastructure and Facilities.--There are authorized to 

be appropriated to the Secretary to carry out activities under section 

955--

 (1) $135,000,000 for fiscal year 2007;

 (2) $140,000,000 for fiscal year 2008; and

 (3) $145,000,000 for fiscal year 2009.

[[Page 119 STAT. 885]]

 (d) Allocations.--From amounts authorized under subsection (a), the 

following sums are authorized:

 (1) For activities under section 953--

 (A) $150,000,000 for fiscal year 2007;

 (B) $155,000,000 for fiscal year 2008; and

 (C) $275,000,000 for fiscal year 2009.

 (2) For activities under section 954--

 (A) $43,600,000 for fiscal year 2007;

 (B) $50,100,000 for fiscal year 2008; and

 (C) $56,000,000 for fiscal year 2009.

 (3) For activities under section 957, $6,000,000 for each of 

 fiscal years 2007 through 2009.

 (e) Limitation.--None of the funds authorized under this section may 

be used to decommission the Fast Flux Test Facility.

SEC. 952. <<NOTE: 42 USC 16272.>> NUCLEAR ENERGY RESEARCH PROGRAMS.

 (a) Nuclear Energy Research Initiative.--The Secretary shall carry 

out a Nuclear Energy Research Initiative for research and development 

related to nuclear energy.

 (b) Nuclear Energy Systems Support Program.--The Secretary shall 

carry out a Nuclear Energy Systems Support Program to support research 

and development activities addressing reliability, availability, 

productivity, component aging, safety, and security of existing nuclear 

power plants.

 (c) Nuclear Power 2010 Program.--

 (1) In general.--The Secretary shall carry out a Nuclear 

 Power 2010 Program, consistent with recommendations of the 

 Nuclear Energy Research Advisory Committee of the Department in 

 the report entitled ``A Roadmap to Deploy New Nuclear Power 

 Plants in the United States by 2010'' and dated October 2001.

 (2) Administration.--The Program shall include--

 (A) use of the expertise and capabilities of 

 industry, institutions of higher education, and National 

 Laboratories in evaluation of advanced nuclear fuel 

 cycles and fuels testing;

 (B) consideration of a variety of reactor designs 

 suitable for both developed and developing nations;

 (C) participation of international collaborators in 

 research, development, and design efforts, as 

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 appropriate; and

 (D) encouragement for participation by institutions 

 of higher education and industry.

 (d) Generation IV Nuclear Energy Systems Initiative.--

 (1) In general.--The Secretary shall carry out a Generation 

 IV Nuclear Energy Systems Initiative to develop an overall 

 technology plan for and to support research and development 

 necessary to make an informed technical decision about the most 

 promising candidates for eventual commercial application.

 (2) Administration.--In conducting the Initiative, the 

 Secretary shall examine advanced proliferation-resistant and 

 passively safe reactor designs, including designs that--

 (A) are economically competitive with other electric 

 power generation plants;

 (B) have higher efficiency, lower cost, and improved 

 safety compared to reactors in operation on the date of 

 enactment of this Act;

[[Page 119 STAT. 886]]

 (C) use fuels that are proliferation resistant and 

 have substantially reduced production of high-level 

 waste per unit of output; and

 (D) use improved instrumentation.

 (e) Reactor Production of Hydrogen.--The Secretary shall carry out 

research to examine designs for high-temperature reactors capable of 

producing large-scale quantities of hydrogen.

SEC. 953. <<NOTE: 42 USC 16273.>> ADVANCED FUEL CYCLE INITIATIVE.

 (a) In General.--The Secretary, acting through the Director of the 

Office of Nuclear Energy, Science and Technology, shall conduct an 

advanced fuel recycling technology research, development, and 

demonstration program (referred to in this section as the ``program'') 

to evaluate proliferation-resistant fuel recycling and transmutation 

technologies that minimize environmental and public health and safety 

impacts as an alternative to aqueous reprocessing technologies deployed 

as of the date of enactment of this Act in support of evaluation of 

alternative national strategies for spent nuclear fuel and the 

Generation IV advanced reactor concepts.

 (b) Annual Review.--The program shall be subject to annual review by 

the Nuclear Energy Research Advisory Committee of the Department or 

other independent entity, as appropriate.

 (c) International Cooperation.--In carrying out the program, the 

Secretary is encouraged to seek opportunities to enhance the progress of 

the program through international cooperation.

 (d) Reports.--The Secretary shall submit, as part of the annual 

budget submission of the Department, a report on the activities of the 

program.

SEC. 954. <<NOTE: 42 USC 16274.>> UNIVERSITY NUCLEAR SCIENCE AND 

 ENGINEERING SUPPORT.

 (a) In General.--The Secretary shall conduct a program to invest in 

human resources and infrastructure in the nuclear sciences and related 

fields, including health physics, nuclear engineering, and 

radiochemistry, consistent with missions of the Department related to 

civilian nuclear research, development, demonstration, and commercial 

application.

 (b) Requirements.--In carrying out the program under this section, 

the Secretary shall--

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 (1) conduct a graduate and undergraduate fellowship program 

 to attract new and talented students, which may include 

 fellowships for students to spend time at National Laboratories 

 in the areas of nuclear science, engineering, and health physics 

 with a member of the National Laboratory staff acting as a 

 mentor;

 (2) conduct a junior faculty research initiation grant 

 program to assist universities in recruiting and retaining new 

 faculty in the nuclear sciences and engineering by awarding 

 grants to junior faculty for research on issues related to 

 nuclear energy engineering and science;

 (3) support fundamental nuclear sciences, engineering, and 

 health physics research through a nuclear engineering education 

 and research program;

 (4) encourage collaborative nuclear research among industry, 

 National Laboratories, and universities; and

 (5) support communication and outreach related to nuclear 

 science, engineering, and health physics.

[[Page 119 STAT. 887]]

 (c) University-National Laboratory Interactions.--The Secretary 

shall conduct--

 (1) a fellowship program for professors at universities to 

 spend sabbaticals at National Laboratories in the areas of 

 nuclear science and technology; and

 (2) a visiting scientist program in which National 

 Laboratory staff can spend time in academic nuclear science and 

 engineering departments.

 (d) Strengthening University Research and Training Reactors and 

Associated Infrastructure.--In carrying out the program under this 

section, the Secretary may support--

 (1) converting research reactors from high-enrichment fuels 

 to low-enrichment fuels and upgrading operational 

 instrumentation;

 (2) consortia of universities to broaden access to 

 university research reactors;

 (3) student training programs, in collaboration with the 

 United States nuclear industry, in relicensing and upgrading 

 reactors, including through the provision of technical 

 assistance; and

 (4) reactor improvements as part of a taking into 

 consideration effort that emphasizes research, training, and 

 education, including through the Innovations in Nuclear 

 Infrastructure and Education Program or any similar program.

 (e) Operations and Maintenance.--Funding for a project provided 

under this section may be used for a portion of the operating and 

maintenance costs of a research reactor at a university used in the 

project.

 (f) Definition.--In this section, the term ``junior faculty'' means 

a faculty member who was awarded a doctorate less than 10 years before 

receipt of an award from the grant program described in subsection 

(b)(2).

SEC. 955. <<NOTE: 42 USC 16275.>> DEPARTMENT OF ENERGY CIVILIAN NUCLEAR 

 INFRASTRUCTURE AND FACILITIES.

 (a) In General.--The Secretary shall operate and maintain 

infrastructure and facilities to support the nuclear energy research, 

development, demonstration, and commercial application programs, 

including radiological facilities management, isotope production, and 

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facilities management.

 (b) Duties.--In carrying out this section, the Secretary shall--

 (1) develop an inventory of nuclear science and engineering 

 facilities, equipment, expertise, and other assets at all of the 

 National Laboratories;

 (2) develop a prioritized list of nuclear science and 

 engineering plant and equipment improvements needed at each of 

 the National Laboratories;

 (3) consider the available facilities and expertise at all 

 National Laboratories and emphasize investments which complement 

 rather than duplicate capabilities; and

 (4) develop a timeline and a proposed budget for the 

 completion of deferred maintenance on plant and equipment, with 

 the goal of ensuring that Department programs under this 

 subtitle will be generally recognized to be among the best in 

 the world.

 (c) Plan.--The Secretary shall develop a comprehensive plan for the 

facilities at the Idaho National Laboratory, especially taking

[[Page 119 STAT. 888]]

into account the resources available at other National Laboratories. In 

developing the plan, the Secretary shall--

 (1) evaluate the facilities planning processes utilized by 

 other physical science and engineering research and development 

 institutions, both in the United States and abroad, that are 

 generally recognized as being among the best in the world, and 

 consider how those processes might be adapted toward developing 

 such facilities plan;

 (2) avoid duplicating, moving, or transferring nuclear 

 science and engineering facilities, equipment, expertise, and 

 other assets that currently exist at other National 

 Laboratories;

 (3) consider the establishment of a national transuranic 

 analytic chemistry laboratory as a user facility at the Idaho 

 National Laboratory;

 (4) include a plan to develop, if feasible, the Advanced 

 Test Reactor and Test Reactor Area into a user facility that is 

 more readily accessible to academic and industrial researchers;

 (5) consider the establishment of a fast neutron source as a 

 user facility;

 (6) consider the establishment of new hot cells and the 

 configuration of hot cells most likely to advance research, 

 development, demonstration, and commercial application in 

 nuclear science and engineering, especially in the context of 

 the condition and availability of these facilities elsewhere in 

 the National Laboratories; and

 (7) include a timeline and a proposed budget for the 

 completion of deferred maintenance on plant and equipment.

 (d) Transmittal to Congress.--Not <<NOTE: Deadline.>> later than 1 

year after the date of enactment of this Act, the Secretary shall 

transmit the plan under subsection (c) to Congress.

SEC. 956. <<NOTE: 42 USC 16276.>> SECURITY OF NUCLEAR FACILITIES.

 The Secretary, acting through the Director of the Office of Nuclear 

Energy, Science and Technology, shall conduct a research and development 

program on cost-effective technologies for increasing--

 (1) the safety of nuclear facilities from natural phenomena; 

 and

 (2) the security of nuclear facilities from deliberate 

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 attacks.

SEC. 957. <<NOTE: 42 USC 16277.>> ALTERNATIVES TO INDUSTRIAL RADIOACTIVE 

 SOURCES.

 (a) Survey.--

 (1) In general.--Not <<NOTE: Deadline.>> later than August 

 1, 2006, the Secretary shall submit to Congress the results of a 

 survey of industrial applications of large radioactive sources.

 (2) Administration.--The survey shall--

 (A) consider well-logging sources as one class of 

 industrial sources;

 (B) include information on current domestic and 

 international Department, Department of Defense, State 

 Department, and commercial programs to manage and 

 dispose of radioactive sources; and

 (C) analyze available disposal options for currently 

 deployed or future sources and, if deficiencies are 

 noted for either deployed or future sources, recommend 

 legislative options that Congress may consider to remedy 

 identified deficiencies.

[[Page 119 STAT. 889]]

 (b) Plan.--

 (1) In general.--In conjunction with the survey conducted 

 under subsection (a), the Secretary shall establish a research 

 and development program to develop alternatives to sources 

 described in subsection (a) that reduce safety, environmental, 

 or proliferation risks to either workers using the sources or 

 the public.

 (2) Accelerators.--Miniaturized particle accelerators for 

 well-logging or other industrial applications and portable 

 accelerators for production of short-lived radioactive materials 

 at an industrial site shall be considered as part of the 

 research and development efforts.

 (3) Report.--Not later than August 1, 2006, the Secretary 

 shall submit to Congress a report describing the details of the 

 program plan.

 Subtitle F--Fossil Energy

SEC. 961. <<NOTE: 42 USC 16291.>> FOSSIL ENERGY.

 (a) In General.--The Secretary shall carry out research, 

development, demonstration, and commercial application programs in 

fossil energy, including activities under this subtitle, with the goal 

of improving the efficiency, effectiveness, and environmental 

performance of fossil energy production, upgrading, conversion, and 

consumption. Such programs take into consideration the following 

objectives:

 (1) Increasing the energy conversion efficiency of all forms 

 of fossil energy through improved technologies.

 (2) Decreasing the cost of all fossil energy production, 

 generation, and delivery.

 (3) Promoting diversity of energy supply.

 (4) Decreasing the dependence of the United States on 

 foreign energy supplies.

 (5) Improving United States energy security.

 (6) Decreasing the environmental impact of energy-related 

 activities.

 (7) Increasing the export of fossil energy-related 

 equipment, technology, and services from the United States.

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 (b) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out fossil energy research, 

development, demonstration, and commercial application activities, 

including activities authorized under this subtitle--

 (1) $611,000,000 for fiscal year 2007;

 (2) $626,000,000 for fiscal year 2008; and

 (3) $641,000,000 for fiscal year 2009.

 (c) Allocations.--From amounts authorized under subsection (a), the 

following sums are authorized:

 (1) For activities under section 962--

 (A) $367,000,000 for fiscal year 2007;

 (B) $376,000,000 for fiscal year 2008; and

 (C) $394,000,000 for fiscal year 2009.

 (2) For activities under section 964--

 (A) $20,000,000 for fiscal year 2007;

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

 (C) $30,000,000 for fiscal year 2009.

 (3) For activities under section 966--

[[Page 119 STAT. 890]]

 (A) $1,500,000 for fiscal year 2007; and

 (B) $450,000 for each of fiscal years 2008 and 2009.

 (4) For the Office of Arctic Energy under section 3197 of 

 the Floyd D. Spence National Defense Authorization Act for 

 Fiscal Year 2001 (42 U.S.C. 7144d) $25,000,000 for each of 

 fiscal years 2007 through 2009.

 (d) Extended Authorization.--There are authorized to be appropriated 

to the Secretary for the Office of Arctic Energy established under 

section 3197 of the Floyd D. Spence National Defense Authorization Act 

for Fiscal Year 2001 (42 U.S.C. 7144d) $25,000,000 for each of fiscal 

years 2010 through 2012.

 (e) Limitations.--

 (1) Uses.--None of the funds authorized under this section 

 may be used for Fossil Energy Environmental Restoration or 

 Import/Export Authorization.

 (2) Institutions of higher education.--Of the funds 

 authorized under subsection (c)(2), not less than 20 percent of 

 the funds appropriated for each fiscal year shall be dedicated 

 to research and development carried out at institutions of 

 higher education.

SEC. 962. <<NOTE: 42 USC 16292.>> COAL AND RELATED TECHNOLOGIES PROGRAM.

 (a) In General.--In addition to the programs authorized under title 

IV, the Secretary shall conduct a program of technology research, 

development, demonstration, and commercial application for coal and 

power systems, including programs to facilitate production and 

generation of coal-based power through--

 (1) innovations for existing plants (including mercury 

 removal);

 (2) gasification systems;

 (3) advanced combustion systems;

 (4) turbines for synthesis gas derived from coal;

 (5) carbon capture and sequestration research and 

 development;

 (6) coal-derived chemicals and transportation fuels;

 (7) liquid fuels derived from low rank coal water slurry;

 (8) solid fuels and feedstocks;

 (9) advanced coal-related research;

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 (10) advanced separation technologies; and

 (11) fuel cells for the operation of synthesis gas derived 

 from coal.

 (b) Cost and Performance Goals.--

 (1) In general.--In carrying out programs authorized by this 

 section, during each of calendar years 2008, 2010, 2012, and 

 2016, and during each fiscal year beginning after September 30, 

 2021, the Secretary shall identify cost and performance goals 

 for coal-based technologies that would permit the continued 

 cost-competitive use of coal for the production of electricity, 

 chemical feedstocks, and transportation fuels.

 (2) Administration.--In establishing the cost and 

 performance goals, the Secretary shall--

 (A) consider activities and studies undertaken as of 

 the date of enactment of this Act by industry in 

 cooperation with the Department in support of the 

 identification of the goals;

 (B) consult with interested entities, including--

 (i) coal producers;

[[Page 119 STAT. 891]]

 (ii) industries using coal;

 (iii) organizations that promote coal and 

 advanced coal technologies;

 (iv) environmental organizations;

 (v) organizations representing workers; and

 (vi) organizations representing consumers;

 (C) <<NOTE: Deadline. Federal 

 Register, publication.>> not later than 120 days after 

 the date of enactment of this Act, publish in the 

 Federal Register proposed draft cost and performance 

 goals for public comments; and

 (D) <<NOTE: Deadline. Reports.>> not later than 180 

 days after the date of enactment of this Act and every 4 

 years thereafter, submit to Congress a report describing 

 the final cost and performance goals for the 

 technologies that includes--

 (i) a list of technical milestones; and

 (ii) an explanation of how programs authorized 

 in this section will not duplicate the activities 

 authorized under the Clean Coal Power Initiative 

 authorized under title IV.

 (c) Powder River Basin and Fort Union Lignite Coal Mercury 

Removal.--

 (1) In general.--In addition to the programs authorized by 

 subsection (a), the Secretary shall establish a program to test 

 and develop technologies to control and remove mercury emissions 

 from subbituminous coal mined in the Powder River Basin, and 

 Fort Union lignite coals, that are used for the generation of 

 electricity.

 (2) Efficacy of mercury removal technology.--In carrying out 

 the program under paragraph (1), the Secretary shall examine the 

 efficacy of mercury removal technologies on coals described in 

 that paragraph that are blended with other types of coal.

 (d) Fuel Cells.--

 (1) In general.--The Secretary shall conduct a program of 

 research, development, demonstration, and commercial application 

 on fuel cells for low-cost, high-efficiency, fuel-flexible, 

 modular power systems.

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 (2) Demonstrations.--The demonstrations referred to in 

 paragraph (1) shall include solid oxide fuel cell technology for 

 commercial, residential, and transportation applications, and 

 distributed generation systems, using improved manufacturing 

 production and processes.

SEC. 963. <<NOTE: 42 USC 16293.>> CARBON CAPTURE RESEARCH AND 

 DEVELOPMENT PROGRAM.

 (a) In General.--The Secretary shall carry out a 10-year carbon 

capture research and development program to develop carbon dioxide 

capture technologies on combustion-based systems for use--

 (1) in new coal utilization facilities; and

 (2) on the fleet of coal-based units in existence on the 

 date of enactment of this Act.

 (b) Objectives.--The objectives of the program under subsection (a) 

shall be--

 (1) to develop carbon dioxide capture technologies, 

 including adsorption and absorption techniques and chemical 

 processes, to remove the carbon dioxide from gas streams 

 containing carbon dioxide potentially amenable to sequestration;

[[Page 119 STAT. 892]]

 (2) to develop technologies that would directly produce 

 concentrated streams of carbon dioxide potentially amenable to 

 sequestration;

 (3) to increase the efficiency of the overall system to 

 reduce the quantity of carbon dioxide emissions released from 

 the system per megawatt generated; and

 (4) in accordance with the carbon dioxide capture program, 

 to promote a robust carbon sequestration program and continue 

 the work of the Department, in conjunction with the private 

 sector, through regional carbon sequestration partnerships.

 (c) Authorization of Appropriations.--From amounts authorized under 

section 961(b), the following sums are authorized for activities 

described in subsection (a)(2):

 (1) $25,000,000 for fiscal year 2006;

 (2) $30,000,000 for fiscal year 2007; and

 (3) $35,000,000 for fiscal year 2008.

SEC. 964. <<NOTE: 42 USC 16294.>> RESEARCH AND DEVELOPMENT FOR COAL 

 MINING TECHNOLOGIES.

 (a) Establishment.--The Secretary shall carry out a program for 

research and development on coal mining technologies.

 (b) Cooperation.--In carrying out the program, the Secretary shall 

cooperate with appropriate Federal agencies, coal producers, trade 

associations, equipment manufacturers, institutions of higher education 

with mining engineering departments, and other relevant entities.

 (c) Program.--The research and development activities carried out 

under this section shall--

 (1) be guided by the mining research and development 

 priorities identified by the Mining Industry of the Future 

 Program and in the recommendations from relevant reports of the 

 National Academy of Sciences on mining technologies;

 (2) include activities exploring minimization of 

 contaminants in mined coal that contribute to environmental 

 concerns including development and demonstration of 

 electromagnetic wave imaging ahead of mining operations;

 (3) develop and demonstrate coal bed electromagnetic wave 

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 imaging, spectroscopic reservoir analysis technology, and 

 techniques for horizontal drilling in order to--

 (A) identify areas of high coal gas content;

 (B) increase methane recovery efficiency;

 (C) prevent spoilage of domestic coal reserves; and

 (D) minimize water disposal associated with methane 

 extraction; and

 (4) expand mining research capabilities at institutions of 

 higher education.

SEC. 965. <<NOTE: 42 USC 16295.>> OIL AND GAS RESEARCH PROGRAMS.

 (a) In General.--The Secretary shall conduct a program of research, 

development, demonstration, and commercial application of oil and gas, 

including--

 (1) exploration and production;

 (2) gas hydrates;

 (3) reservoir life and extension;

 (4) transportation and distribution infrastructure;

 (5) ultraclean fuels;

 (6) heavy oil, oil shale, and tar sands; and

 (7) related environmental research.

[[Page 119 STAT. 893]]

 (b) Objectives.--The objectives of this program shall include 

advancing the science and technology available to domestic petroleum 

producers, particularly independent operators, to minimize the economic 

dislocation caused by the decline of domestic supplies of oil and 

natural gas resources.

 (c) Natural Gas and Oil Deposits Report.--Not later than 2 years 

after the date of enactment of this Act and every 2 years thereafter, 

the Secretary of the Interior, in consultation with other appropriate 

Federal agencies, shall submit to Congress a report on the latest 

estimates of natural gas and oil reserves, reserves growth, and 

undiscovered resources in Federal and State waters off the coast of 

Louisiana, Texas, Alabama, and Mississippi.

 (d) Integrated Clean Power and Energy Research.--

 (1) Establishment of center.--The Secretary shall establish 

 a national center or consortium of excellence in clean energy 

 and power generation, using the resources of the Clean Power and 

 Energy Research Consortium in existence on the date of enactment 

 of this Act, to address the critical dependence of the United 

 States on energy and the need to reduce emissions.

 (2) Focus areas.--The center or consortium shall conduct a 

 program of research, development, demonstration, and commercial 

 application on integrating the following 6 focus areas:

 (A) Efficiency and reliability of gas turbines for 

 power generation.

 (B) Reduction in emissions from power generation.

 (C) Promotion of energy conservation issues.

 (D) Effectively using alternative fuels and 

 renewable energy.

 (E) Development of advanced materials technology for 

 oil and gas exploration and use in harsh environments.

 (F) Education on energy and power generation issues.

SEC. 966. <<NOTE: 42 USC 16296.>> LOW-VOLUME OIL AND GAS RESERVOIR 

 RESEARCH PROGRAM.

 (a) Definition of GIS.--In this section, the term ``GIS'' means 

geographic information systems technology that facilitates the 

organization and management of data with a geographic component.

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 (b) Program.--The Secretary shall establish a program of research, 

development, demonstration, and commercial application to maximize the 

productive capacity of marginal wells and reservoirs.

 (c) Data Collection.--Under the program, the Secretary shall collect 

data on--

 (1) the status and location of marginal wells and oil and 

 gas reservoirs;

 (2) the production capacity of marginal wells and oil and 

 gas reservoirs;

 (3) the location of low-pressure gathering facilities and 

 pipelines; and

 (4) the quantity of natural gas vented or flared in 

 association with crude oil production.

 (d) Analysis.--Under the program, the Secretary shall--

 (1) estimate the remaining producible reserves based on 

 variable pipeline pressures; and

[[Page 119 STAT. 894]]

 (2) recommend measures that will enable the continued 

 production of those resources.

 (e) Study.--

 (1) In general.--The Secretary may award a grant to an 

 organization of States that contain significant numbers of 

 marginal oil and natural gas wells to conduct an annual study of 

 low-volume natural gas reservoirs.

 (2) Organization with no gis capabilities.--If an 

 organization receiving a grant under paragraph (1) does not have 

 GIS capabilities, the organization shall contract with an 

 institution of higher education with GIS capabilities.

 (3) State geologists.--The organization receiving a grant 

 under paragraph (1) shall collaborate with the State geologist 

 of each State being studied.

 (f) Public Information.--The Secretary may use the data collected 

and analyzed under this section to produce maps and literature to 

disseminate to States to promote conservation of natural gas reserves.

SEC. 967. COMPLEX <<NOTE: Establishment. 42 USC 16297.>> WELL TECHNOLOGY 

 TESTING FACILITY.

 The Secretary, in coordination with industry leaders in extended 

research drilling technology, shall establish a Complex Well Technology 

Testing Facility at the Rocky Mountain Oilfield Testing Center to 

increase the range of extended drilling technologies.

SEC. 968. METHANE <<NOTE: 30 USC 1902 note.>> HYDRATE RESEARCH.

 (a) In General.--The Methane Hydrate Research and Development Act of 

2000 (30 U.S.C. 1902 note; Public Law 106-193) is amended to read as 

follows:

``SECTION 1. SHORT TITLE.

 ``This Act may be cited as the `Methane Hydrate Research and 

Development Act of 2000'.

``SEC. 2. FINDINGS.

 ``Congress finds that--

 ``(1) in order to promote energy independence and meet the 

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 increasing demand for energy, the United States will require a 

 diversified portfolio of substantially increased quantities of 

 electricity, natural gas, and transportation fuels;

 ``(2) according to the report submitted to Congress by the 

 National Research Council entitled `Charting the Future of 

 Methane Hydrate Research in the United States', the total United 

 States resources of gas hydrates have been estimated to be on 

 the order of 200,000 trillion cubic feet;

 ``(3) according to the report of the National Commission on 

 Energy Policy entitled `Ending the Energy Stalemate--A 

 Bipartisan Strategy to Meet America's Energy Challenge', and 

 dated December 2004, the United States may be endowed with over 

 one-fourth of the methane hydrate deposits in the world;

 ``(4) according to the Energy Information Administration, a 

 shortfall in natural gas supply from conventional and 

 unconventional sources is expected to occur in or about 2020; 

 and

 ``(5) the National Academy of Sciences states that methane 

 hydrate may have the potential to alleviate the projected 

 shortfall in the natural gas supply.

[[Page 119 STAT. 895]]

``SEC. 3. DEFINITIONS.

 ``In this Act:

 ``(1) Contract.--The term `contract' means a procurement 

 contract within the meaning of section 6303 of title 31, United 

 States Code.

 ``(2) Cooperative agreement.--The term `cooperative 

 agreement' means a cooperative agreement within the meaning of 

 section 6305 of title 31, United States Code.

 ``(3) Director.--The term `Director' means the Director of 

 the National Science Foundation.

 ``(4) Grant.--The term `grant' means a grant awarded under a 

 grant agreement (within the meaning of section 6304 of title 31, 

 United States Code).

 ``(5) Industrial enterprise.--The term `industrial 

 enterprise' means a private, nongovernmental enterprise that has 

 an expertise or capability that relates to methane hydrate 

 research and development.

 ``(6) Institution of higher education.--The term 

 `institution of higher education' means an institution of higher 

 education (as defined in section 102 of the Higher Education Act 

 of 1965 (20 U.S.C. 1002)).

 ``(7) Secretary.--The term `Secretary' means the Secretary 

 of Energy, acting through the Assistant Secretary for Fossil 

 Energy.

 ``(8) Secretary of commerce.--The term `Secretary of 

 Commerce' means the Secretary of Commerce, acting through the 

 Administrator of the National Oceanic and Atmospheric 

 Administration.

 ``(9) Secretary of defense.--The term `Secretary of Defense' 

 means the Secretary of Defense, acting through the Secretary of 

 the Navy.

 ``(10) Secretary of the interior.--The term `Secretary of 

 the Interior' means the Secretary of the Interior, acting 

 through the Director of the United States Geological Survey, the 

 Director of the Bureau of Land Management, and the Director of 

 the Minerals Management Service.

``SEC. 4. METHANE HYDRATE RESEARCH AND DEVELOPMENT PROGRAM.

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 ``(a) In General.--

 ``(1) Commencement <<NOTE: Deadline.>> of program.--Not 

 later than 90 days after the date of enactment of the Energy 

 Research, Development, Demonstration, and Commercial Application 

 Act of 2005, the Secretary, in consultation with the Secretary 

 of Commerce, the Secretary of Defense, the Secretary of the 

 Interior, and the Director, shall commence a program of methane 

 hydrate research and development in accordance with this 

 section.

 ``(2) Designations.--The Secretary, the Secretary of 

 Commerce, the Secretary of Defense, the Secretary of the 

 Interior, and the Director shall designate individuals to carry 

 out this section.

 ``(3) Coordination.--The individual designated by the 

 Secretary shall coordinate all activities within the Department 

 of Energy relating to methane hydrate research and development.

 ``(4) Meetings.--The <<NOTE: Deadlines.>> individuals 

 designated under paragraph (2) shall meet not later than 180 

 days after the date

[[Page 119 STAT. 896]]

 of enactment of the Energy Research, Development, Demonstration, 

 and Commercial Application Act of 2005 and not less frequently 

 than every 180 days thereafter to--

 ``(A) review the progress of the program under 

 paragraph (1); and

 ``(B) coordinate interagency research and 

 partnership efforts in carrying out the program.

 ``(b) Grants, Contracts, Cooperative Agreements, Interagency Funds 

Transfer Agreements, and Field Work Proposals.--

 ``(1) Assistance and coordination.--In carrying out the 

 program of methane hydrate research and development authorized 

 by this section, the Secretary may award grants to, or enter 

 into contracts or cooperative agreements with, institutions of 

 higher education, oceanographic institutions, and industrial 

 enterprises to--

 ``(A) conduct basic and applied research to 

 identify, explore, assess, and develop methane hydrate 

 as a commercially viable source of energy;

 ``(B) identify methane hydrate resources through 

 remote sensing;

 ``(C) acquire and reprocess seismic data suitable 

 for characterizing methane hydrate accumulations;

 ``(D) assist in developing technologies required for 

 efficient and environmentally sound development of 

 methane hydrate resources;

 ``(E) promote education and training in methane 

 hydrate resource research and resource development 

 through fellowships or other means for graduate 

 education and training;

 ``(F) conduct basic and applied research to assess 

 and mitigate the environmental impact of hydrate 

 degassing (including both natural degassing and 

 degassing associated with commercial development);

 ``(G) develop technologies to reduce the risks of 

 drilling through methane hydrates; and

 ``(H) conduct exploratory drilling, well testing, 

 and production testing operations on permafrost and non-

 permafrost gas hydrates in support of the activities 

 authorized by this paragraph, including drilling of one 

 or more full-scale production test wells.

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 ``(2) Competitive peer review.--Funds made available under 

 paragraph (1) shall be made available based on a competitive 

 process using external scientific peer review of proposed 

 research.

 ``(c) Methane Hydrates Advisory Panel.--

 ``(1) In general.--The <<NOTE: Establishment.>> Secretary 

 shall establish an advisory panel (including the hiring of 

 appropriate staff) consisting of representatives of industrial 

 enterprises, institutions of higher education, oceanographic 

 institutions, State agencies, and environmental organizations 

 with knowledge and expertise in the natural gas hydrates field, 

 to--

 ``(A) assist in developing recommendations and broad 

 programmatic priorities for the methane hydrate research 

 and development program carried out under subsection 

 (a)(1);

[[Page 119 STAT. 897]]

 ``(B) provide scientific oversight for the methane 

 hydrates program, including assessing progress toward 

 program goals, evaluating program balance, and providing 

 recommendations to enhance the quality of the program 

 over time; and

 ``(C) not <<NOTE: Deadline.>> later than 2 years 

 after the date of enactment of the Energy Research, 

 Development, Demonstration, and Commercial Application 

 Act of 2005, and at such later dates as the panel 

 considers advisable, submit to Congress--

 ``(i) an assessment of the methane hydrate 

 research program; and

 ``(ii) an assessment of the 5-year research 

 plan of the Department of Energy.

 ``(2) Conflicts of interest.--In appointing each member of 

 the advisory panel established under paragraph (1), the 

 Secretary shall ensure, to the maximum extent practicable, that 

 the appointment of the member does not pose a conflict of 

 interest with respect to the duties of the member under this 

 Act.

 ``(3) Meetings.--The advisory panel shall--

 ``(A) <<NOTE: Deadline.>> hold the initial meeting 

 of the advisory panel not later than 180 days after the 

 date of establishment of the advisory panel; and

 ``(B) meet biennially thereafter.

 ``(4) Coordination.--The advisory panel shall coordinate 

 activities of the advisory panel with program managers of the 

 Department of Energy at appropriate National Laboratories.

 ``(d) Construction Costs.--None of the funds made available to carry 

out this section may be used for the construction of a new building or 

the acquisition, expansion, remodeling, or alteration of an existing 

building (including site grading and improvement and architect fees).

 ``(e) Responsibilities of the Secretary.--In carrying out subsection 

(b)(1), the Secretary shall--

 ``(1) facilitate and develop partnerships among government, 

 industrial enterprises, and institutions of higher education to 

 research, identify, assess, and explore methane hydrate 

 resources;

 ``(2) undertake programs to develop basic information 

 necessary for promoting long-term interest in methane hydrate 

 resources as an energy source;

 ``(3) ensure that the data and information developed through 

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 the program are accessible and widely disseminated as needed and 

 appropriate;

 ``(4) promote cooperation among agencies that are developing 

 technologies that may hold promise for methane hydrate resource 

 development;

 ``(5) <<NOTE: Reports.>> report annually to Congress on the 

 results of actions taken to carry out this Act; and

 ``(6) ensure, to the maximum extent practicable, greater 

 participation by the Department of Energy in international 

 cooperative efforts.

[[Page 119 STAT. 898]]

``SEC. 5. NATIONAL RESEARCH COUNCIL STUDY.

 ``(a) Agreement for Study.--The Secretary shall offer to enter into 

an agreement with the National Research Council under which the National 

Research Council shall--

 ``(1) conduct a study of the progress made under the methane 

 hydrate research and development program implemented under this 

 Act; and

 ``(2) make recommendations for future methane hydrate 

 research and development needs.

 ``(b) Report.--Not later than September 30, 2009, the Secretary 

shall submit to Congress a report containing the findings and 

recommendations of the National Research Council under this section.

``SEC. 6. REPORTS AND STUDIES FOR CONGRESS.

 ``The Secretary shall provide to the Committee on Science of the 

House of Representatives and the Committee on Energy and Natural 

Resources of the Senate copies of any report or study that the 

Department of Energy prepares at the direction of any committee of 

Congress relating to the methane hydrate research and development 

program implemented under this Act.

``SEC. 7. AUTHORIZATION OF APPROPRIATIONS.

 ``There are authorized to be appropriated to the Secretary to carry 

out this Act, to remain available until expended--

 ``(1) $15,000,000 for fiscal year 2006;

 ``(2) $20,000,000 for fiscal year 2007;

 ``(3) $30,000,000 for fiscal year 2008;

 ``(4) $40,000,000 for fiscal year 2009; and

 ``(5) $50,000,000 for fiscal year 2010.''.

 (b) Reclassification.-- <<NOTE: 30 USC 2001 note.>> The Law Revision 

Counsel shall reclassify the Methane Hydrate Research and Development 

Act of 2000 (30 U.S.C. 1902 note; Public Law 106-193) to a new chapter 

at the end of title 30, United States Code.

 Subtitle G--Science

SEC. 971. <<NOTE: 42 USC 16311.>> SCIENCE.

 (a) In General.--The Secretary shall conduct, through the Office of 

Science, programs of research, development, demonstration, and 

commercial application in high energy physics, nuclear physics, 

biological and environmental research, basic energy sciences, advanced 

scientific computing research, and fusion energy sciences, including 

activities described in this subtitle. The programs shall include 

support for facilities and infrastructure, education, outreach, 

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information, analysis, and coordination activities.

 (b) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary to carry out research, development, 

demonstration, and commercial application activities of the Office of 

Science, including activities authorized under this subtitle (including 

the amounts authorized under the amendment made by section 976(b) and 

including basic energy sciences, advanced scientific and computing 

research, biological and environmental research, fusion energy sciences, 

high energy physics, nuclear physics, research analysis, and 

infrastructure support)--

 (1) $4,153,000,000 for fiscal year 2007;

 (2) $4,586,000,000 for fiscal year 2008; and

[[Page 119 STAT. 899]]

 (3) $5,200,000,000 for fiscal year 2009.

 (c) Allocations.--From amounts authorized under subsection (b), the 

following sums are authorized:

 (1) For activities under the Fusion Energy Sciences program 

 (including activities under section 972)--

 (A) $355,500,000 for fiscal year 2007;

 (B) $369,500,000 for fiscal year 2008;

 (C) $384,800,000 for fiscal year 2009; and

 (D) in addition to the amounts authorized under 

 subparagraphs (A), (B), and (C), such sums as may be 

 necessary for ITER construction, consistent with the 

 limitations of section 972(c)(5).

 (2) For activities under the catalysis research program 

 under section 973--

 (A) $36,500,000 for fiscal year 2007;

 (B) $38,200,000 for fiscal year 2008; and

 (C) such sums as may be necessary for fiscal year 

 2009.

 (3) For activities under the Systems Biology Program under 

 section 977 such sums as may be necessary for each of fiscal 

 years 2007 through 2009.

 (4) For activities under the Energy and Water Supplies 

 program under section 979, $30,000,000 for each of fiscal years 

 2007 through 2009.

 (5) For the energy research fellowships programs under 

 section 984, $40,000,000 for each of fiscal years 2007 through 

 2009.

 (6) For the advanced scientific computing activities under 

 section 976--

 (A) $270,000,000 for fiscal year 2007;

 (B) $350,000,000 for fiscal year 2008; and

 (C) $375,000,000 for fiscal year 2009.

 (7) For the science and engineering education pilot program 

 under section 983--

 (A) $4,000,000 for each of fiscal years 2007 and 

 2008; and

 (B) $8,000,000 for fiscal year 2009.

 (d) Integrated Bioenergy Research and Development.--In addition to 

amounts otherwise authorized by this section, there are authorized to be 

appropriated to the Secretary for integrated bioenergy research and 

development programs, projects, and activities, $49,000,000 for each of 

the fiscal years 2005 through 2009. Activities funded under this 

subsection shall be coordinated with ongoing related programs of other 

Federal agencies, including the Plant Genome Program of the National 

Science Foundation. Of the funds authorized under this subsection, at 

least $5,000,000 for each fiscal year shall be for training and 

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education targeted to minority and socially disadvantaged farmers and 

ranchers.

SEC. 972. FUSION <<NOTE: 42 USC 16312.>> ENERGY SCIENCES PROGRAM.

 (a) Declaration of Policy.--It shall be the policy of the United 

States to conduct research, development, demonstration, and commercial 

applications to provide for the scientific, engineering, and commercial 

infrastructure necessary to ensure that the United States is competitive 

with other countries in providing fusion energy for its own needs and 

the needs of other countries, including by demonstrating electric power 

or hydrogen

[[Page 119 STAT. 900]]

production for the United States energy grid using fusion energy at the 

earliest date.

 (b) Planning.--

 (1) In <<NOTE: Deadline.>> general.--Not later than 180 days 

 after the date of enactment of this Act, the Secretary shall 

 submit to Congress a plan (with proposed cost estimates, 

 budgets, and lists of potential international partners) for the 

 implementation of the policy described in subsection (a) in a 

 manner that ensures that--

 (A) existing fusion research facilities are more 

 fully used;

 (B) fusion science, technology, theory, advanced 

 computation, modeling, and simulation are strengthened;

 (C) new magnetic and inertial fusion research and 

 development facilities are selected based on scientific 

 innovation and cost effectiveness, and the potential of 

 the facilities to advance the goal of practical fusion 

 energy at the earliest date practicable;

 (D) facilities that are selected are funded at a 

 cost-effective rate;

 (E) communication of scientific results and methods 

 between the fusion energy science community and the 

 broader scientific and technology communities is 

 improved;

 (F) inertial confinement fusion facilities are used 

 to the extent practicable for the purpose of inertial 

 fusion energy research and development;

 (G) attractive alternative inertial and magnetic 

 fusion energy approaches are more fully explored; and

 (H) to the extent practicable, the recommendations 

 of the Fusion Energy Sciences Advisory Committee in the 

 report on workforce planning, dated March 2004, are 

 carried out, including periodic reassessment of program 

 needs.

 (2) Costs and schedules.--The plan shall also address the 

 status of and, to the extent practicable, costs and schedules 

 for--

 (A) the design and implementation of international 

 or national facilities for the testing of fusion 

 materials; and

 (B) the design and implementation of international 

 or national facilities for the testing and development 

 of key fusion technologies.

 (c) United States Participation in ITER.--

 (1) Definitions.--In this subsection:

 (A) Construction.--

 (i) In general.--The term ``construction'' 

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 means--

 (I) the physical construction of the 

 ITER facility; and

 (II) the physical construction, 

 purchase, or manufacture of equipment or 

 components that are specifically 

 designed for the ITER facility.

 (ii) Exclusions.--The term ``construction'' 

 does not include the design of the facility, 

 equipment, or components.

 (B) ITER.--The term ``ITER'' means the international 

 burning plasma fusion research project in which the 

 President announced United States participation on 

 January 30, 2003, or any similar international project.

[[Page 119 STAT. 901]]

 (2) Participation.--The United States may participate in the 

 ITER only in accordance with this subsection.

 (3) Agreement.--

 (A) In general.--The Secretary may negotiate an 

 agreement for United States participation in the ITER.

 (B) Contents.--Any agreement for United States 

 participation in the ITER shall, at a minimum--

 (i) clearly define the United States financial 

 contribution to construction and operating costs, 

 as well as any other costs associated with a 

 project;

 (ii) ensure that the share of high-technology 

 components of the ITER manufactured in the United 

 States is at least proportionate to the United 

 States financial contribution to the ITER;

 (iii) ensure that the United States will not 

 be financially responsible for cost overruns in 

 components manufactured in other ITER 

 participating countries;

 (iv) guarantee the United States full access 

 to all data generated by the ITER;

 (v) enable United States researchers to 

 propose and carry out an equitable share of the 

 experiments at the ITER;

 (vi) provide the United States with a role in 

 all collective decisionmaking related to the ITER; 

 and

 (vii) describe the process for discontinuing 

 or decommissioning the ITER and any United States 

 role in that process.

 (4) Plan.--

 (A) Development.--The Secretary, in consultation 

 with the Fusion Energy Sciences Advisory Committee, 

 shall develop a plan for the participation of United 

 States scientists in the ITER that shall include--

 (i) the United States research agenda for the 

 ITER;

 (ii) methods to evaluate whether the ITER is 

 promoting progress toward making fusion a reliable 

 and affordable source of power; and

 (iii) a description of how work at the ITER 

 will relate to other elements of the United States 

 fusion program.

 (B) Review.--The Secretary shall request a review of 

 the plan by the National Academy of Sciences.

 (5) Limitation.-- <<NOTE: Reports. Deadlines.>> No Federal 

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 funds shall be expended for the construction of the ITER until 

 the Secretary has submitted to Congress--

 (A) the agreement negotiated in accordance with 

 paragraph (3) and 120 days have elapsed since that 

 submission;

 (B) a report describing the management structure of 

 the ITER and providing a fixed dollar estimate of the 

 cost of United States participation in the construction 

 of the ITER, and 120 days have elapsed since that 

 submission;

 (C) a report describing how United States 

 participation in the ITER will be funded without 

 reducing funding for other programs in the Office of 

 Science (including other fusion programs), and 60 days 

 have elapsed since that submission; and

[[Page 119 STAT. 902]]

 (D) the plan required by paragraph (4) (but not the 

 National Academy of Sciences review of that plan), and 

 60 days have elapsed since that submission.

 (6) Alternative to iter.--

 (A) In general.--If at any time during the 

 negotiations on the ITER, the Secretary determines that 

 construction and operation of the ITER is unlikely or 

 infeasible, the Secretary shall submit to Congress, 

 along with the budget request of the President submitted 

 to Congress for the following fiscal year, a plan for 

 implementing a domestic burning plasma experiment such 

 as the Fusion Ignition Research Experiment, including 

 costs and schedules for the plan.

 (B) Administration.--The Secretary shall--

 (i) refine the plan in full consultation with 

 the Fusion Energy Sciences Advisory Committee; and

 (ii) transmit the plan to the National Academy 

 of Sciences for review.

SEC. 973. <<NOTE: 42 USC 16313.>> CATALYSIS RESEARCH PROGRAM.

 (a) Establishment.--The Secretary, acting through the Office of 

Science, shall support a program of research and development in 

catalysis science consistent with the statutory authorities of the 

Department related to research and development.

 (b) Components.--The program shall include efforts to--

 (1) enable catalyst design using combinations of 

 experimental and mechanistic methodologies coupled with 

 computational modeling of catalytic reactions at the molecular 

 level;

 (2) develop techniques for high throughput synthesis, assay, 

 and characterization at nanometer and subnanometer scales in-

 situ under actual operating conditions;

 (3) synthesize catalysts with specific site architectures;

 (4) conduct research on the use of precious metals for 

 catalysis; and

 (5) translate molecular understanding to the design of 

 catalytic compounds.

 (c) Duties of the Office of Science.--In carrying out the program, 

the Director of the Office of Science shall--

 (1) support both individual investigators and 

 multidisciplinary teams of investigators to pioneer new 

 approaches in catalytic design;

 (2) develop, plan, construct, acquire, share, or operate 

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 special equipment or facilities for the use of investigators in 

 collaboration with national user facilities, such as nanoscience 

 and engineering centers;

 (3) support technology transfer activities to benefit 

 industry and other users of catalysis science and engineering; 

 and

 (4) coordinate research and development activities with 

 industry and other Federal agencies.

 (d) Assessment.--Not <<NOTE: Deadline.>> later than 3 years after 

the date of enactment of this Act, the Secretary shall enter into an 

arrangement with the National Academy of Sciences to--

 (1) review the catalysis program to measure--

 (A) gains made in the fundamental science of 

 catalysis; and

 (B) progress towards developing new fuels for energy 

 production and material fabrication processes; and

[[Page 119 STAT. 903]]

 (2) submit <<NOTE: Reports.>> to Congress a report 

 describing the results of the review.

SEC. 974. <<NOTE: 42 USC 16314.>> HYDROGEN.

 (a) In General.--The Secretary shall conduct a program of 

fundamental research and development in support of programs authorized 

under title VIII.

 (b) Methods.--The program shall include support for methods of 

generating hydrogen without the use of natural gas.

SEC. 975. <<NOTE: 42 USC 16315.>> SOLID STATE LIGHTING.

 The Secretary shall conduct a program of fundamental research on 

solid state lighting in support of the Next Generation Lighting 

Initiative carried out under section 912.

SEC. 976. <<NOTE: 42 USC 16316.>> ADVANCED SCIENTIFIC COMPUTING FOR 

 ENERGY MISSIONS.

 (a) Program.--

 (1) In general.--The Secretary shall conduct an advanced 

 scientific computing research and development program that 

 includes activities related to applied mathematics and 

 activities authorized by the Department of Energy High-End 

 Computing Revitalization Act of 2004 (15 U.S.C. 5541 et seq.).

 (2) Goal.--The Secretary shall carry out the program with 

 the goal of supporting departmental missions, and providing the 

 high-performance computational, networking, advanced 

 visualization technologies, and workforce resources, that are 

 required for world leadership in science.

 (b) High-Performance Computing.--Section 203 of the High-Performance 

Computing Act of 1991 (15 U.S.C. 5523) is amended to read as follows:

``SEC. 203. DEPARTMENT OF ENERGY ACTIVITIES.

 ``(a) General Responsibilities.--As part of the Program described in 

title I, the Secretary of Energy shall--

 ``(1) conduct and support basic and applied research in 

 high-performance computing and networking to support fundamental 

 research in science and engineering disciplines related to 

 energy applications; and

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 ``(2) provide computing and networking infrastructure 

 support, including--

 ``(A) the provision of high-performance computing 

 systems that are among the most advanced in the world in 

 terms of performance in solving scientific and 

 engineering problems; and

 ``(B) support for advanced software and applications 

 development for science and engineering disciplines 

 related to energy applications.

 ``(b) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary of Energy such sums as are necessary to 

carry out this section.''.

SEC. 977. <<NOTE: 42 USC 16317.>> SYSTEMS BIOLOGY PROGRAM.

 (a) Program.--

 (1) Establishment.--The Secretary shall establish a 

 research, development, and demonstration program in microbial 

 and plant systems biology, protein science, and computational 

 biology to support the energy, national security, and 

 environmental missions of the Department.

[[Page 119 STAT. 904]]

 (2) Grants.--The program shall support individual 

 researchers and multidisciplinary teams of researchers through 

 competitive, merit-reviewed grants.

 (3) Consultation.--In carrying out the program, the 

 Secretary shall consult with other Federal agencies that conduct 

 genetic and protein research.

 (b) Goals.--The program shall have the goal of developing 

technologies and methods based on the biological functions of genomes, 

microbes, and plants that--

 (1) can facilitate the production of fuels, including 

 hydrogen;

 (2) convert carbon dioxide to organic carbon;

 (3) detoxify soils and water, including at facilities of the 

 Department, contaminated with heavy metals and radiological 

 materials; and

 (4) address other Department missions as identified by the 

 Secretary.

 (c) Plan.--

 (1) Development <<NOTE: Deadline.>> of plan.--Not later than 

 1 year after the date of enactment of this Act, the Secretary 

 shall prepare and transmit to Congress a research plan 

 describing how the program authorized pursuant to this section 

 will be undertaken to accomplish the program goals established 

 in subsection (b).

 (2) Review <<NOTE: Contracts.>> of plan.--The Secretary 

 shall contract with the National Academy of Sciences to review 

 the research plan developed under this 

 subsection. <<NOTE: Deadline.>> The Secretary shall transmit the 

 review to Congress not later than 18 months after transmittal of 

 the research plan under paragraph (1), along with the 

 Secretary's response to the recommendations contained in the 

 review.

 (d) User Facilities and Ancillary Equipment.--Within the funds 

authorized to be appropriated pursuant to this subtitle, amounts shall 

be available for projects to develop, plan, construct, acquire, or 

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operate special equipment, instrumentation, or facilities, including 

user facilities at National Laboratories, for researchers conducting 

research, development, demonstration, and commercial application in 

systems biology and proteomics and associated biological disciplines.

 (e) Prohibition on Biomedical and Human Cell and Human Subject 

Research.--

 (1) No biomedical research.--In carrying out the program 

 under this section, the Secretary shall not conduct biomedical 

 research.

 (2) Limitations.--Nothing in this section shall authorize 

 the Secretary to conduct any research or demonstrations--

 (A) on human cells or human subjects; or

 (B) designed to have direct application with respect 

 to human cells or human subjects.

SEC. 978. FISSION <<NOTE: 42 USC 16318.>> AND FUSION ENERGY MATERIALS 

 RESEARCH PROGRAM.

 (a) In General.--Along with the budget request of the President 

submitted to Congress for fiscal year 2007, the Secretary shall 

establish a research and development program on material science issues 

presented by advanced fission reactors and the fusion energy program of 

the Department.

[[Page 119 STAT. 905]]

 (b) Administration.--In carrying out the program, the Secretary 

shall develop--

 (1) a catalog of material properties required for 

 applications described in subsection (a);

 (2) theoretical models for materials possessing the required 

 properties;

 (3) benchmark models against existing data; and

 (4) a roadmap to guide further research and development in 

 the area covered by the program.

SEC. 979. <<NOTE: 42 USC 16319.>> ENERGY AND WATER SUPPLIES.

 (a) In General.--The Secretary shall carry out a program of 

research, development, demonstration, and commercial application to--

 (1) address energy-related issues associated with provision 

 of adequate water supplies, optimal management, and efficient 

 use of water;

 (2) address water-related issues associated with the 

 provision of adequate supplies, optimal management, and 

 efficient use of energy; and

 (3) assess the effectiveness of existing programs within the 

 Department and other Federal agencies to address these energy 

 and water related issues.

 (b) Program Elements.--The program under this section shall 

include--

 (1) arsenic treatment;

 (2) desalination; and

 (3) planning, analysis, and modeling of energy and water 

 supply and demand.

 (c) Collaboration.--In carrying out this section, the Secretary 

shall consult with the Administrator of the Environmental Protection 

Agency, the Secretary of the Interior, the Chief Engineer of the Army 

Corps of Engineers, the Secretary of Commerce, the Secretary of Defense, 

and other Federal agencies as appropriate.

 (d) Facilities.--The Secretary may utilize all existing facilities 

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within the Department and may design and construct additional facilities 

as needed to carry out the purposes of this program.

 (e) Advisory <<NOTE: Establishment.>> Committee.--The Secretary 

shall establish or utilize an advisory committee to provide independent 

advice and review of the program.

 (f) Reports.--Not later than 2 years after the date of enactment of 

this Act, the Secretary shall submit to Congress a report on the 

assessment described in subsection (b) and recommendations for future 

actions.

SEC. 980. <<NOTE: 42 USC 16320.>> SPALLATION NEUTRON SOURCE.

 (a) Definitions.--In this section:

 (1) SING.--The term ``SING'' means the Spallation Neutron 

 Source Instruments Next Generation major item of equipment.

 (2) SNS power upgrade.--The term ``SNS power upgrade'' means 

 the Spallation Neutron Source power upgrade described in the 20-

 year facilities plan of the Office of Science of the Department.

 (3) SNS second target station.--The term ``SNS second target 

 station'' means the Spallation Neutron Source second target 

 station described in the 20-year facilities plan of the Office 

 of Science of the Department.

[[Page 119 STAT. 906]]

 (4) Spallation neutron source facility.--The terms 

 ``Spallation Neutron Source Facility'' and ``Facility'' mean the 

 completed Spallation Neutron Source scientific user facility 

 located at Oak Ridge National Laboratory, Oak Ridge, Tennessee.

 (5) Spallation neutron source project.--The terms 

 ``Spallation Neutron Source Project'' and ``Project'' means 

 Department Project 99-E-334, Oak Ridge National Laboratory, Oak 

 Ridge, Tennessee.

 (b) Spallation Neutron Source Project.--

 (1) In <<NOTE: Reports.>> general.--The Secretary shall 

 submit to Congress, as part of the annual budget request of the 

 President submitted to Congress, a report on progress on the 

 Spallation Neutron Source Project.

 (2) Contents.--The report shall include for the Project--

 (A) a description of the achievement of milestones;

 (B) a comparison of actual costs to estimated costs; 

 and

 (C) any changes in estimated Project costs or 

 schedule.

 (c) Spallation Neutron Source Facility Plan.--

 (1) In general.--The Secretary shall develop an operational 

 plan for the Spallation Neutron Source Facility that ensures 

 that the Facility is employed to the full capability of the 

 Facility in support of the study of advanced materials, 

 nanoscience, and other missions of the Office of Science of the 

 Department.

 (2) Plan.--The operational plan shall--

 (A) include a plan for the operation of an effective 

 scientific user program that--

 (i) is based on peer review of proposals 

 submitted for use of the Facility;

 (ii) includes scientific and technical support 

 to ensure that external users, including 

 researchers based at institutions of higher 

 education, are able to make full use of a variety 

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 of high quality scientific instruments; and

 (iii) phases in systems upgrades to ensure 

 that the Facility remains at the forefront of 

 international scientific endeavors in the field of 

 the Facility throughout the operating life of the 

 Facility;

 (B) include an ongoing program to develop new 

 instruments that builds on the high performance neutron 

 source and that allows neutron scattering techniques to 

 be applied to a growing range of scientific problems and 

 disciplines; and

 (C) address the status of and, to the maximum extent 

 practicable, costs and schedules for--

 (i) full user mode operations of the Facility;

 (ii) instrumentation built at the Facility 

 during the operating phase through full use of the 

 experimental hall, including the SING;

 (iii) the SNS power upgrade; and

 (iv) the SNS second target station.

 (d) Authorization of Appropriations.--

[[Page 119 STAT. 907]]

 (1) Spallation neutron source project.--There is authorized 

 to be appropriated to carry out the Spallation Neutron Source 

 Project for the lifetime of the Project $1,411,700,000 for total 

 project costs, of which--

 (A) $1,192,700,000 shall be used for the costs of 

 construction; and

 (B) $219,000,000 shall be used for other Project 

 costs.

 (2) Spallation neutron source facility.--

 (A) In general.--Except as provided in subparagraph 

 (B), there is authorized to be appropriated for the 

 Spallation Neutron Source Facility for--

 (i) the SING, $75,000,000 for each of fiscal 

 year 2007 through 2009; and

 (ii) the SNS power upgrade, $160,000,000, to 

 remain available until expended.

 (B) Insufficient stockpiles of heavy water.--If 

 stockpiles of heavy water of the Department are 

 insufficient to meet the needs of the Facility, there is 

 authorized to be appropriated for the Facility 

 $12,000,000 for fiscal year 2007.

SEC. 981. RARE <<NOTE: 42 USC 16321.>> ISOTOPE ACCELERATOR.

 (a) Establishment.--The Secretary shall construct and operate a Rare 

Isotope Accelerator. The Secretary shall <<NOTE: Deadline.>> commence 

construction no later than September 30, 2008.

 (b) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary such sums as may be necessary to carry out 

this section. The Secretary shall not spend more than $1,100,000,000 in 

Federal funds for all activities associated with the Rare Isotope 

Accelerator, prior to operation of the Accelerator.

SEC. 982. <<NOTE: 42 USC 16322.>> OFFICE OF SCIENTIFIC AND TECHNICAL 

 INFORMATION.

 The Secretary, through the Office of Scientific and Technical 

Information, shall maintain within the Department publicly available 

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collections of scientific and technical information resulting from 

research, development, demonstration, and commercial applications 

activities supported by the Department.

SEC. 983. <<NOTE: 42 USC 16323.>> SCIENCE AND ENGINEERING EDUCATION 

 PILOT PROGRAM.

 (a) Establishment <<NOTE: Grants.>> of Pilot Program.--The Secretary 

shall award a grant to a Southeastern United States consortium of major 

research universities that currently advances science and education by 

partnering with National Laboratories, to establish a regional pilot 

program of its SEEK-16 program for enhancing scientific, technological, 

engineering, and mathematical literacy, creativity, and decision-making. 

The consortium shall include leading research universities, one or more 

universities that train substantial numbers of elementary and secondary 

school teachers, and (where appropriate) National Laboratories.

 (b) Program Elements.--The regional pilot program shall include--

 (1) expanding strategic, formal partnerships among 

 universities with strength in research, universities that train 

 substantial numbers of elementary and secondary school teachers, 

 and the private sector;

 (2) combining Department expertise with one or more National 

 Aeronautics and Space Administration Educator Resource Centers;

[[Page 119 STAT. 908]]

 (3) developing programs to permit current and future 

 teachers to participate in ongoing research projects at National 

 Laboratories and research universities and to adapt lessons 

 learned to the classroom;

 (4) designing and implementing course work;

 (5) designing and implementing a strategy for measuring and 

 assessing progress under the program; and

 (6) developing models for transferring knowledge gained 

 under the pilot program to other institutions and areas of the 

 United States.

 (c) Categorization.--A grant under this section shall be considered 

an authorized activity under section 3165 of the Department of Energy 

Science Education Enhancement Act (42 U.S.C. 7381b).

 (d) Report.--No later than 2 years after the award of the grant, the 

Secretary shall transmit to Congress a report outlining lessons learned 

and, if determined appropriate by the Secretary, containing a plan for 

expanding the program throughout the United States.

SEC. 984. <<NOTE: 42 USC 16324.>> ENERGY RESEARCH FELLOWSHIPS.

 (a) Postdoctoral Fellowship Program.--The Secretary shall establish 

a program under which the Secretary provides fellowships to encourage 

outstanding young scientists and engineers to pursue postdoctoral 

research appointments in energy research and development at institutions 

of higher education of their choice.

 (b) Senior Research Fellowships.--

 (1) In general.--The Secretary shall establish a program 

 under which the Secretary provides fellowships to allow 

 outstanding senior researchers and their research groups in 

 energy research and development to explore research and 

 development topics of their choosing for a period of not less 

 than 3 years, to be determined by the Secretary.

 (2) Consideration.--In providing a fellowship under the 

 program described in paragraph (1), the Secretary shall 

 consider--

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 (A) the past scientific or technical accomplishment 

 of a senior researcher; and

 (B) the potential for continued accomplishment by 

 the researcher during the period of the fellowship.

SEC. 984A. <<NOTE: 42 USC 16325.>> SCIENCE AND TECHNOLOGY SCHOLARSHIP 

 PROGRAM.

 (a) In General.--The Secretary is authorized to establish a Science 

and Technology Scholarship Program to award scholarships to individuals 

that is designed to recruit and prepare students for careers in the 

Department and National Laboratories.

 (b) Service Requirement.--The Secretary may require that an 

individual receiving a scholarship under this section serve as a fulltime employee of the Department or a National Laboratory for a fixed 

period in return for receiving the scholarship.

 Subtitle H--International Cooperation

SEC. 985. <<NOTE: 42 USC 16341.>> WESTERN HEMISPHERE ENERGY COOPERATION.

 (a) Program.--The Secretary shall carry out a program to promote 

cooperation on energy issues with countries of the Western Hemisphere.

[[Page 119 STAT. 909]]

 (b) Activities.--Under the program, the Secretary shall fund 

activities to work with countries of the Western Hemisphere to--

 (1) increase the production of energy supplies;

 (2) improve energy efficiency; and

 (3) assist in the development and transfer of energy supply 

 and efficiency technologies that would have a beneficial impact 

 on world energy markets.

 (c) Participation by Institutions of Higher Education.--To the 

extent practicable, the Secretary shall carry out the program under this 

section with the participation of institutions of higher education so as 

to take advantage of the acceptance of institutions of higher education 

by countries of the Western Hemisphere as sources of unbiased technical 

and policy expertise when assisting the Secretary in--

 (1) evaluating new technologies;

 (2) resolving technical issues;

 (3) working with those countries in the development of new 

 policies; and

 (4) training policymakers, particularly in the case of 

 institutions of higher education that involve the participation 

 of minority students, such as--

 (A) Hispanic-serving institutions; and

 (B) part B institutions.

 (d) Authorization of Appropriations.--There are authorized to be 

appropriated to carry out this section--

 (1) $10,000,000 for fiscal year 2007;

 (2) $13,000,000 for fiscal year 2008; and

 (3) $16,000,000 for fiscal year 2009.

SEC. 986. COOPERATION BETWEEN UNITED STATES AND ISRAEL.

 (a) Findings.--Congress finds that--

 (1) on February 1, 1996, the United States and Israel signed 

 the agreement entitled ``Agreement between the Department of 

 Energy of the United States of America and the Ministry of 

 Energy and Infrastructure of Israel Concerning Energy 

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 Cooperation'' (referred to in this section as the 

 ``Agreement''), to establish a framework for collaboration 

 between the United States and Israel in energy research and 

 development activities;

 (2) the Agreement entered into force in February 2000;

 (3) in February 2005, the Agreement was automatically 

 renewed for 1 additional 5-year period pursuant to Article X of 

 the Agreement; and

 (4) under the Agreement, the United States and Israel may 

 cooperate in energy research and development in a variety of 

 alternative and advanced energy sectors.

 (b) Report to Congress.--Not later than 90 days after the date of 

enactment of this Act, the Secretary shall submit to the Committee on 

Energy and Natural Resources and the Committee on Foreign Relations of 

the Senate and the Committee on Energy and Commerce and the Committee on 

International Relations of the House of Representatives a report that 

describes--

 (1) the ways in which the United States and Israel have 

 cooperated on energy research and development activities under 

 the Agreement;

 (2) projects initiated pursuant to the Agreement; and

 (3) plans for future cooperation and joint projects under 

 the Agreement.

[[Page 119 STAT. 910]]

 (c) Sense of Congress.--It is the sense of Congress that energy 

cooperation between the Governments of the United States and Israel is 

mutually beneficial in the development of energy technology.

SEC. 986A. <<NOTE: 42 USC 16342.>> INTERNATIONAL ENERGY TRAINING.

 (a) In General.--The Secretary, in consultation with the Secretary 

of Commerce, the Secretary of the Interior, and Secretary of State, and 

the Federal Energy Regulatory Commission, shall coordinate training and 

outreach efforts for international commercial energy markets in 

countries with developing and restructuring economies.

 (b) Components.--The training and outreach efforts referred to in 

subsection (a) may include--

 (1) production-related fiscal regimes;

 (2) grid and network issues;

 (3) energy user and demand side response;

 (4) international trade of energy; and

 (5) international transportation of energy.

 (c) Authorization of Appropriations.--There is authorized to be 

appropriated to carry out this section $1,500,000 for each of fiscal 

years 2007 through 2010.

 Subtitle I--Research Administration and Operations

SEC. 987. <<NOTE: 42 USC 16351.>> AVAILABILITY OF FUNDS.

 Funds authorized to be appropriated to the Department under this Act 

or an amendment made by this Act shall remain available until expended.

SEC. 988. <<NOTE: 42 USC 16352.>> COST SHARING.

 (a) Applicability.--Notwithstanding any other provision of law, in 

carrying out a research, development, demonstration, or commercial 

application program or activity that is initiated after the date of 

enactment of this section, the Secretary shall require cost-sharing in 

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accordance with this section.

 (b) Research and Development.--

 (1) In general.--Except as provided in paragraphs (2) and 

 (3) and subsection (f), the Secretary shall require not less 

 than 20 percent of the cost of a research or development 

 activity described in subsection (a) to be provided by a non-

 Federal source.

 (2) Exclusion.--Paragraph (1) shall not apply to a research 

 or development activity described in subsection (a) that is of a 

 basic or fundamental nature, as determined by the appropriate 

 officer of the Department.

 (3) Reduction.--The Secretary may reduce or eliminate the 

 requirement of paragraph (1) for a research and development 

 activity of an applied nature if the Secretary determines that 

 the reduction is necessary and appropriate.

 (c) Demonstration and Commercial Application.--

 (1) In general.--Except as provided in paragraph (2) and 

 subsection (f), the Secretary shall require that not less than

[[Page 119 STAT. 911]]

 50 percent of the cost of a demonstration or commercial 

 application activity described in subsection (a) to be provided 

 by a non-Federal source.

 (2) Reduction of non-federal share.--The Secretary may 

 reduce the non-Federal share required under paragraph (1) if the 

 Secretary determines the reduction to be necessary and 

 appropriate, taking into consideration any technological risk 

 relating to the activity.

 (d) Calculation of Amount.--In calculating the amount of a nonFederal contribution under this section, the Secretary--

 (1) may include allowable costs in accordance with the 

 applicable cost principles, including--

 (A) cash;

 (B) personnel costs;

 (C) the value of a service, other resource, or third 

 party in-kind contribution determined in accordance with 

 the applicable circular of the Office of Management and 

 Budget;

 (D) indirect costs or facilities and administrative 

 costs; or

 (E) any funds received under the power program of 

 the Tennessee Valley Authority (except to the extent 

 that such funds are made available under an annual 

 appropriation Act); and

 (2) shall not include--

 (A) revenues or royalties from the prospective 

 operation of an activity beyond the time considered in 

 the award;

 (B) proceeds from the prospective sale of an asset 

 of an activity; or

 (C) other appropriated Federal funds.

 (e) Repayment of Federal Share.--The Secretary shall not require 

repayment of the Federal share of a cost-shared activity under this 

section as a condition of making an award.

 (f) Exclusions.--This section shall not apply to--

 (1) a cooperative research and development agreement under 

 the Stevenson-Wydler Technology Innovation Act of 1980 (15 

 U.S.C. 3701 et seq.);

 (2) a fee charged for the use of a Department facility; or

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 (3) an award under--

 (A) the small business innovation research program 

 under section 9 of the Small Business Act (15 U.S.C. 

 638); or

 (B) the small business technology transfer program 

 under that section.

SEC. 989. <<NOTE: 42 USC 16353.>> MERIT REVIEW OF PROPOSALS.

 (a) Awards.--Awards of funds authorized under this Act or an 

amendment made by this Act shall be made only after an impartial review 

of the scientific and technical merit of the proposals for the awards 

has been carried out by or for the Department.

 (b) Competition.--Competitive awards under this Act shall involve 

competitions open to all qualified entities within one or more of the 

following categories:

 (1) Institutions of higher education.

 (2) National Laboratories.

 (3) Nonprofit and for-profit private entities.

[[Page 119 STAT. 912]]

 (4) State and local governments.

 (5) Consortia of entities described in paragraphs (1) 

 through (4).

 (c) Sense of Congress.--It is the sense of Congress that research, 

development, demonstration, and commercial application activities 

carried out by the Department should be awarded using competitive 

procedures, to the maximum extent practicable.

SEC. 990. <<NOTE: 42 USC 16354.>> EXTERNAL TECHNICAL REVIEW OF 

 DEPARTMENTAL PROGRAMS.

 (a) National Energy Research and Development Advisory Boards.--

 (1) Establishment.--The Secretary shall establish one or 

 more advisory boards to review research, development, 

 demonstration, and commercial application programs of the 

 Department in energy efficiency, renewable energy, nuclear 

 energy, and fossil energy.

 (2) Alternatives.--The Secretary may--

 (A) designate an existing advisory board within the 

 Department to fulfill the responsibilities of an 

 advisory board under this section; and

 (B) enter into appropriate arrangements with the 

 National Academy of Sciences to establish such an 

 advisory board.

 (b) Use of Existing Committees.--The Secretary shall continue to use 

the scientific program advisory committees chartered under the Federal 

Advisory Committee Act (5 U.S.C. App.) by the Office of Science to 

oversee research and development programs under that Office.

 (c) Membership.--Each advisory board under this section shall 

consist of persons with appropriate expertise representing a diverse 

range of interests.

 (d) Meetings and Goals.--

 (1) Meetings.--Each advisory board under this section shall 

 meet at least semiannually to review and advise on the progress 

 made by the respective one or more research, development, 

 demonstration, and commercial application programs.

 (2) Goals.--The advisory board shall review the measurable 

 cost and performance-based goals for the programs as established 

 under section 902, and the progress on meeting the goals.

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 (e) Periodic Reviews and Assessments.--

 (1) In general.--The Secretary shall enter into appropriate 

 arrangements with the National Academy of Sciences to conduct 

 periodic reviews and assessments of--

 (A) the research, development, demonstration, and 

 commercial application programs authorized by this Act 

 and amendments made by this Act;

 (B) the measurable cost and performance-based goals 

 for the programs as established under section 902, if 

 any; and

 (C) the progress on meeting the goals.

 (2) Timing.--The reviews and assessments shall be conducted 

 every 5 years or more often as the Secretary considers 

 necessary.

[[Page 119 STAT. 913]]

 (3) Reports.--The Secretary shall submit to Congress reports 

 describing the results of all the reviews and assessments.

SEC. 991. <<NOTE: 42 USC 16355.>> NATIONAL LABORATORY DESIGNATION.

 After the date of enactment of this Act, the Secretary shall not 

designate a facility that is not listed in section 2(3) as a National 

Laboratory.

SEC. 992. <<NOTE: 42 USC 16356.>> REPORT ON EQUAL EMPLOYMENT OPPORTUNITY 

 PRACTICES.

 Not later than 12 months after the date of enactment of this Act, 

and biennially thereafter, the Secretary shall transmit to Congress a 

report on the equal employment opportunity practices at National 

Laboratories. Such report shall include--

 (1) a thorough review of each National Laboratory 

 contractor's equal employment opportunity policies, including 

 promotion to management and professional positions and pay 

 raises;

 (2) a statistical report on complaints and their disposition 

 in the National Laboratories;

 (3) a description of how equal employment opportunity 

 practices at the National Laboratories are treated in the 

 contract and in calculating award fees for each contractor;

 (4) a summary of disciplinary actions and their disposition 

 by either the Department or the relevant contractors for each 

 National Laboratory;

 (5) a summary of outreach efforts to attract women and 

 minorities to the National Laboratories;

 (6) a summary of efforts to retain women and minorities in 

 the National Laboratories; and

 (7) a summary of collaboration efforts with the Office of 

 Federal Contract Compliance Programs to improve equal employment 

 opportunity practices at the National Laboratories.

SEC. 993. <<NOTE: 42 USC 16357.>> STRATEGY AND PLAN FOR SCIENCE AND 

 ENERGY FACILITIES AND INFRASTRUCTURE.

 (a) Facility and Infrastructure Policy.--

 (1) In general.--The Secretary shall develop and implement a 

 strategy for facilities and infrastructure supported primarily 

 from the Office of Science, the Office of Energy Efficiency and 

 Renewable Energy, the Office of Fossil Energy, or the Office of 

 Nuclear Energy, Science and Technology Programs at all National 

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 Laboratories and single-purpose research facilities.

 (2) Strategy.--The strategy shall provide cost-effective 

 means for--

 (A) maintaining existing facilities and 

 infrastructure;

 (B) closing unneeded facilities;

 (C) making facility modifications; and

 (D) building new facilities.

 (b) Report.--

 (1) In general.--The Secretary shall prepare and submit, 

 along with the budget request of the President submitted to 

 Congress for fiscal year 2008, a report describing the strategy 

 developed under subsection (a).

[[Page 119 STAT. 914]]

 (2) Contents.--For each National Laboratory and single-

 purpose research facility that is primarily used for science and 

 energy research, the report shall contain--

 (A) the current priority list of proposed facilities 

 and infrastructure projects, including cost and schedule 

 requirements;

 (B) a current 10-year plan that demonstrates the 

 reconfiguration of its facilities and infrastructure to 

 meet its missions and to address its long-term 

 operational costs and return on investment;

 (C) the total current budget for all facilities and 

 infrastructure funding; and

 (D) the current status of each facility and 

 infrastructure project compared to the original baseline 

 cost, schedule, and scope.

SEC. 994. <<NOTE: 42 USC 16358.>> STRATEGIC RESEARCH PORTFOLIO ANALYSIS 

 AND COORDINATION PLAN.

 (a) In General.--The Secretary shall periodically review all of the 

science and technology activities of the Department in a strategic 

framework that takes into account both the frontiers of science to which 

the Department can contribute and the national needs relevant to the 

Department's statutory missions.

 (b) Coordination Analysis and Plan.--As part of the review under 

subsection (a), the Secretary shall develop a coordination plan to 

improve coordination and collaboration in research, development, 

demonstration, and commercial application activities across Department 

organizational boundaries.

 (c) Plan Contents.--The plan shall describe--

 (1) cross-cutting scientific and technical issues and 

 research questions that span more than one program or major 

 office of the Department;

 (2) how the applied technology programs of the Department 

 are coordinating their activities, and addressing those 

 questions;

 (3) ways in which the technical interchange within the 

 Department, particularly between the Office of Science and the 

 applied technology programs, can be enhanced, including ways in 

 which the research agendas of the Office of Science and the 

 applied programs can interact and assist each other;

 (4) a description of how the Secretary will ensure that the 

 Department's overall research agenda include, in addition to 

 fundamental, curiosity-driven research, fundamental research 

 related to topics of concern to the applied programs, and 

 applications in Departmental technology programs of research 

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 results generated by fundamental, curiosity-driven research.

 (d) Plan <<NOTE: Deadlines.>> Transmittal.--Not later than 12 months 

after the date of enactment of this Act, and every 4 years thereafter, 

the Secretary shall transmit to Congress the results of the review under 

subsection (a) and the coordination plan under subsection (b).

SEC. 995. <<NOTE: 42 USC 16359.>> COMPETITIVE AWARD OF MANAGEMENT 

 CONTRACTS.

 None of the funds authorized to be appropriated to the Secretary by 

this title may be used to award a management and operating contract for 

a National Laboratory (excluding those named in subparagraphs (G), (H), 

(N), and (O) of section 2 (3)), unless

[[Page 119 STAT. 915]]

such contract is competitively awarded, or the Secretary grants, on a 

case-by-case basis, a waiver. <<NOTE: Reports. Deadline.>> The Secretary 

may not delegate the authority to grant such a waiver and shall submit 

to Congress a report notifying it of the waiver, and setting forth the 

reasons for the waiver, at least 60 days prior to the date of the award 

of such contract.

SEC. 996. <<NOTE: 42 USC 16360.>> WESTERN MICHIGAN DEMONSTRATION 

 PROJECT.

 The Administrator of the Environmental Protection Agency, in 

consultation with the State of Michigan and affected local officials, 

shall conduct a demonstration project to address the effect of 

transported ozone and ozone precursors in Southwestern Michigan. The 

demonstration program shall address projected nonattainment areas in 

Southwestern Michigan that include counties with design values for ozone 

of less than .095 based on years 2000 to 2002 or the most current 3-year 

period of air quality data. The Administrator shall assess any 

difficulties such areas may experience in meeting the 8-hour national 

ambient air quality standard for ozone due to the effect of transported 

ozone or ozone precursors into the areas. The Administrator shall work 

with State and local officials to determine the extent of ozone and 

ozone precursor transport, to assess alternatives to achieve compliance 

with the 8-hour standard apart from local controls, and to determine the 

timeframe in which such compliance could take 

place. <<NOTE: Deadline.>> The Administrator shall complete this 

demonstration project no later than 2 years after the date of enactment 

of this section and shall not impose any requirement or sanction under 

the Clean Air Act (42 U.S.C. 7401 et seq.) that might otherwise apply 

during the pendency of the demonstration project.

SEC. 997. <<NOTE: 42 USC 16361.>> ARCTIC ENGINEERING RESEARCH CENTER.

 (a) In <<NOTE: Establishment. Grants.>> General.--The Secretary of 

Transportation, in consultation with the Secretary and the United States 

Arctic Research Commission, shall provide annual grants to a university 

located adjacent to the Arctic Energy Office of the Department of 

Energy, to establish and operate a university research center to be 

headquartered in Fairbanks and to be known as the ``Arctic Engineering 

Research Center'' (referred to in this section as the ``Center'').

 (b) Purpose.--The purpose of the Center shall be to conduct research 

on, and develop improved methods of, construction and use of materials 

to improve the overall performance of roads, bridges, residential, 

commercial, and industrial structures, and other infrastructure in the 

Arctic region, with an emphasis on developing--

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 (1) new construction techniques for roads, bridges, rail, 

 and related transportation infrastructure and residential, 

 commercial, and industrial infrastructure that are capable of 

 withstanding the Arctic environment and using limited energy 

 resources as efficiently as practicable;

 (2) technologies and procedures for increasing road, bridge, 

 rail, and related transportation infrastructure and residential, 

 commercial, and industrial infrastructure safety, reliability, 

 and integrity in the Arctic region;

 (3) new materials and improving the performance and energy 

 efficiency of existing materials for the construction of roads, 

 bridges, rail, and related transportation infrastructure

[[Page 119 STAT. 916]]

 and residential, commercial, and industrial infrastructure in 

 the Arctic region; and

 (4) recommendations for new local, regional, and State 

 permitting and building codes to ensure transportation and 

 building safety and efficient energy use when constructing, 

 using, and occupying such infrastructure in the Arctic region.

 (c) Objectives.--The Center shall carry out--

 (1) basic and applied research in the subjects described in 

 subsection (b), the products of which shall be judged by peers 

 or other experts in the field to advance the body of knowledge 

 in road, bridge, rail, and infrastructure engineering in the 

 Arctic region; and

 (2) an ongoing program of technology transfer that makes 

 research results available to potential users in a form that can 

 be implemented.

 (d) Amount of Grant.--For each of fiscal years 2006 through 2011, 

the Secretary shall provide a grant in the amount of $3,000,000 to the 

institution specified in subsection (a) to carry out this section.

 (e) Authorization of Appropriations.--There are authorized to be 

appropriated to carry out this section $3,000,000 for each of fiscal 

years 2006 through 2011.

SEC. 998. <<NOTE: 42 USC 16362.>> BARROW GEOPHYSICAL RESEARCH FACILITY.

 (a) Establishment.--The Secretary of Commerce, in consultation with 

the Secretaries of Energy and the Interior, the Director of the National 

Science Foundation, and the Administrator of the Environmental 

Protection Agency, shall establish a joint research facility in Barrow, 

Alaska, to be known as the ``Barrow Geophysical Research Facility'', to 

support scientific research activities in the Arctic.

 (b) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretaries of Commerce, Energy, and the Interior, 

the Director of the National Science Foundation, and the Administrator 

of the Environmental Protection Agency for the planning, design, 

construction, and support of the Barrow Geophysical Research Facility, 

$61,000,000.

 Subtitle J--Ultra-Deepwater and Unconventional Natural Gas and Other 

 Petroleum Resources

SEC. 999A. <<NOTE: 42 USC 16371.>> PROGRAM AUTHORITY.

 (a) In General.--The Secretary shall carry out a program under this 

subtitle of research, development, demonstration, and commercial 

application of technologies for ultra-deepwater and unconventional 

natural gas and other petroleum resource exploration and production, 

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including addressing the technology challenges for small producers, safe 

operations, and environmental mitigation (including reduction of 

greenhouse gas emissions and sequestration of carbon).

 (b) Program Elements.--The program under this subtitle shall address 

the following areas, including improving safety and minimizing 

environmental impacts of activities within each area:

[[Page 119 STAT. 917]]

 (1) Ultra-deepwater architecture and technology, including 

 drilling to formations in the Outer Continental Shelf to depths 

 greater than 15,000 feet.

 (2) Unconventional natural gas and other petroleum resource 

 exploration and production technology.

 (3) The technology challenges of small producers.

 (4) Complementary research performed by the National Energy 

 Technology Laboratory for the Department.

 (c) Limitation on Location of Field Activities.--Field activities 

under the program under this subtitle shall be carried out only--

 (1) in--

 (A) areas in the territorial waters of the United 

 States not under any Outer Continental Shelf moratorium 

 as of September 30, 2002;

 (B) areas onshore in the United States on public 

 land administered by the Secretary of the Interior 

 available for oil and gas leasing, where consistent with 

 applicable law and land use plans; and

 (C) areas onshore in the United States on State or 

 private land, subject to applicable law; and

 (2) with the approval of the appropriate Federal or State 

 land management agency or private land owner.

 (d) Activities at the National Energy Technology Laboratory.--The 

Secretary, through the National Energy Technology Laboratory, shall 

carry out a program of research and other activities complementary to 

and supportive of the research programs under subsection (b).

 (e) Consultation With Secretary of the Interior.--In carrying out 

this subtitle, the Secretary shall consult regularly with the Secretary 

of the Interior.

SEC. 999B. <<NOTE: 42 USC 16372.>> ULTRA-DEEPWATER AND UNCONVENTIONAL 

 ONSHORE NATURAL GAS AND OTHER PETROLEUM RESEARCH AND 

 DEVELOPMENT PROGRAM.

 (a) In General.--The Secretary shall carry out the activities under 

section 999A, to maximize the value of natural gas and other petroleum 

resources of the United States, by increasing the supply of such 

resources, through reducing the cost and increasing the efficiency of 

exploration for and production of such resources, while improving safety 

and minimizing environmental impacts.

 (b) Role of the Secretary.--The Secretary shall have ultimate 

responsibility for, and oversight of, all aspects of the program under 

this section.

 (c) Role of the Program Consortium.--

 (1) In general.--The Secretary shall contract with a 

 corporation that is structured as a consortium to administer the 

 programmatic activities outlined in this chapter. The program 

 consortium shall--

 (A) administer the program pursuant to subsection 

 (f)(3), utilizing program administration funds only;

 (B) issue research project solicitations upon 

 approval of the Secretary or the Secretary's designee;

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 (C) make project awards to research performers upon 

 approval of the Secretary or the Secretary's designee;

 (D) disburse research funds to research performers 

 awarded under subsection (f) as directed by the 

 Secretary

[[Page 119 STAT. 918]]

 in accordance with the annual plan under subsection (e); 

 and

 (E) carry out other activities assigned to the 

 program consortium by this section.

 (2) Limitation.--The Secretary may not assign any activities 

 to the program consortium except as specifically authorized 

 under this section.

 (3) Conflict of interest.--

 (A) Procedures.--The Secretary shall establish 

 procedures--

 (i) to ensure that each board member, officer, 

 or employee of the program consortium who is in a 

 decisionmaking capacity under subsection (f)(3) 

 shall disclose to the Secretary any financial 

 interests in, or financial relationships with, 

 applicants for or recipients of awards under this 

 section, including those of his or her spouse or 

 minor child, unless such relationships or 

 interests would be considered to be remote or 

 inconsequential; and

 (ii) to require any board member, officer, or 

 employee with a financial relationship or interest 

 disclosed under clause (i) to recuse himself or 

 herself from any oversight under subsection (f)(4) 

 with respect to such applicant or recipient.

 (B) Failure to comply.--The Secretary may disqualify 

 an application or revoke an award under this section if 

 a board member, officer, or employee has failed to 

 comply with procedures required under subparagraph 

 (A)(ii).

 (d) Selection of the Program Consortium.--

 (1) In general.--The Secretary shall select the program 

 consortium through an open, competitive process.

 (2) Members.--The program consortium may include 

 corporations, trade associations, institutions of higher 

 education, National Laboratories, or other research 

 institutions. After submitting a proposal under paragraph (4), 

 the program consortium may not add members without the consent 

 of the Secretary.

 (3) Requirement of section 501(c)(3) status.--The Secretary 

 shall not select a consortium under this section unless such 

 consortium is an organization described in section 501(c)(3) of 

 the Internal Revenue Code of 1986 and exempt from tax under such 

 section 501(a) of such Code.

 (4) Schedule.-- <<NOTE: Deadlines.>> Not later than 90 days 

 after the date of enactment of this Act, the Secretary shall 

 solicit proposals from eligible consortia to perform the duties 

 in subsection (c)(1), which shall be submitted not later than 

 180 days after the date of enactment of this Act. The Secretary 

 shall select the program consortium not later than 270 days 

 after such date of enactment.

 (5) Application.--Applicants shall submit a proposal 

 including such information as the Secretary may require. At a 

 minimum, each proposal shall--

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 (A) list all members of the consortium;

 (B) fully describe the structure of the consortium, 

 including any provisions relating to intellectual 

 property; and

[[Page 119 STAT. 919]]

 (C) describe how the applicant would carry out the 

 activities of the program consortium under this section.

 (6) Eligibility.--To be eligible to be selected as the 

 program consortium, an applicant must be an entity whose members 

 have collectively demonstrated capabilities and experience in 

 planning and managing research, development, demonstration, and 

 commercial application programs for ultra-deepwater and 

 unconventional natural gas or other petroleum exploration or 

 production.

 (7) Focus areas for awards.--

 (A) Ultra-deepwater resources.--Awards from 

 allocations under section 999H(d)(1) shall focus on the 

 development and demonstration of individual exploration 

 and production technologies as well as integrated 

 systems technologies including new architectures for 

 production in ultra-deepwater.

 (B) Unconventional resources.--Awards from 

 allocations under section 999H(d)(2) shall focus on 

 areas including advanced coalbed methane, deep drilling, 

 natural gas production from tight sands, natural gas 

 production from gas shales, stranded gas, innovative 

 exploration and production techniques, enhanced recovery 

 techniques, and environmental mitigation of 

 unconventional natural gas and other petroleum resources 

 exploration and production.

 (C) Small producers.--Awards from allocations under 

 section 999H(d)(3) shall be made to consortia consisting 

 of small producers or organized primarily for the 

 benefit of small producers, and shall focus on areas 

 including complex geology involving rapid changes in the 

 type and quality of the oil and gas reservoirs across 

 the reservoir; low reservoir pressure; unconventional 

 natural gas reservoirs in coalbeds, deep reservoirs, 

 tight sands, or shales; and unconventional oil 

 reservoirs in tar sands and oil shales.

 (e) Annual Plan.--

 (1) In general.--The program under this section shall be 

 carried out pursuant to an annual plan prepared by the Secretary 

 in accordance with paragraph (2).

 (2) Development.--

 (A) Solicitation of recommendations.--Before 

 drafting an annual plan under this subsection, the 

 Secretary shall solicit specific written recommendations 

 from the program consortium for each element to be 

 addressed in the plan, including those described in 

 paragraph (4). The program consortium shall submit its 

 recommendations in the form of a draft annual plan.

 (B) Submission of recommendations; other comment.--

 The Secretary shall submit the recommendations of the 

 program consortium under subparagraph (A) to the Ultra-

 Deepwater Advisory Committee established under section 

 999D(a) and to the Unconventional Resources Technology 

 Advisory Committee established under section 999D(b), 

 and such Advisory Committees shall provide to the 

 Secretary written comments by a date determined by the 

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 Secretary. The Secretary may also solicit comments from 

 any other experts.

[[Page 119 STAT. 920]]

 (C) Consultation.--The Secretary shall consult 

 regularly with the program consortium throughout the 

 preparation of the annual plan.

 (3) Publication.-- <<NOTE: Federal Register, 

 publication.>> The Secretary shall transmit to Congress and 

 publish in the Federal Register the annual plan, along with any 

 written comments received under paragraph (2)(A) and (B).

 (4) Contents.--The annual plan shall describe the ongoing 

 and prospective activities of the program under this section and 

 shall include--

 (A) a list of any solicitations for awards to carry 

 out research, development, demonstration, or commercial 

 application activities, including the topics for such 

 work, who would be eligible to apply, selection 

 criteria, and the duration of awards; and

 (B) a description of the activities expected of the 

 program consortium to carry out subsection (f)(3).

 (5) Estimates <<NOTE: Reports.>> of increased royalty 

 receipts.--The Secretary, in consultation with the Secretary of 

 the Interior, shall provide an annual report to Congress with 

 the President's budget on the estimated cumulative increase in 

 Federal royalty receipts (if any) resulting from the 

 implementation of this subtitle. The initial report under this 

 paragraph shall be submitted in the first President's budget 

 following the completion of the first annual plan required under 

 this subsection.

 (f) Awards.--

 (1) In general.--Upon approval of the Secretary the program 

 consortium shall make awards to research performers to carry out 

 research, development, demonstration, and commercial application 

 activities under the program under this section. The program 

 consortium shall not be eligible to receive such awards, but 

 provided that conflict of interest procedures in section 

 999B(c)(3) are followed, entities who are members of the program 

 consortium are not precluded from receiving research awards as 

 either individual research performers or as research performers 

 who are members of a research collaboration.

 (2) Proposals.--Upon approval of the Secretary the program 

 consortium shall solicit proposals for awards under this 

 subsection in such manner and at such time as the Secretary may 

 prescribe, in consultation with the program consortium.

 (3) Oversight.--

 (A) In general.--The program consortium shall 

 oversee the implementation of awards under this 

 subsection, consistent with the annual plan under 

 subsection (e), including disbursing funds and 

 monitoring activities carried out under such awards for 

 compliance with the terms and conditions of the awards.

 (B) Effect.--Nothing in subparagraph (A) shall limit 

 the authority or responsibility of the Secretary to 

 oversee awards, or limit the authority of the Secretary 

 to review or revoke awards.

 (g) Administrative Costs.--

 (1) In general.--To compensate the program consortium for 

 carrying out its activities under this section, the Secretary 

 shall provide to the program consortium funds sufficient to 

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 administer the program. This compensation may include a

[[Page 119 STAT. 921]]

 management fee consistent with Department of Energy contracting 

 practices and procedures.

 (2) Advance.--The Secretary shall advance funds to the 

 program consortium upon selection of the consortium, which shall 

 be deducted from amounts to be provided under paragraph (1).

 (h) Audit.--The Secretary shall retain an independent auditor, which 

shall include a review by the General Accountability Office, to 

determine the extent to which funds provided to the program consortium, 

and funds provided under awards made under subsection (f), have been 

expended in a manner consistent with the purposes and requirements of 

this subtitle. <<NOTE: Reports.>> The auditor shall transmit a report 

(including any review by the General Accountability Office) annually to 

the Secretary, who shall transmit the report to Congress, along with a 

plan to remedy any deficiencies cited in the report.

 (i) Activities by the United States Geological Survey.--The 

Secretary of the Interior, through the United States Geological Survey, 

shall, where appropriate, carry out programs of long-term research to 

complement the programs under this section.

 (j) Program <<NOTE: Contracts.>> Review and Oversight.--The National 

Energy Technology Laboratory, on behalf of the Secretary, shall (1) 

issue a competitive solicitation for the program consortium, (2) 

evaluate, select, and award a contract or other agreement to a qualified 

program consortium, and (3) have primary review and oversight 

responsibility for the program consortium, including review and approval 

of research awards proposed to be made by the program consortium, to 

ensure that its activities are consistent with the purposes and 

requirements described in this subtitle. Up to 5 percent of program 

funds allocated under paragraphs (1) through (3) of section 999H(d) may 

be used for this purpose, including program direction and the 

establishment of a site office if determined to be necessary to carry 

out the purposes of this subsection.

SEC. 999C. <<NOTE: 42 USC 16373.>> ADDITIONAL REQUIREMENTS FOR AWARDS.

 (a) Demonstration Projects.--An application for an award under this 

subtitle for a demonstration project shall describe with specificity the 

intended commercial use of the technology to be demonstrated.

 (b) Flexibility in Locating Demonstration Projects.--Subject to the 

limitation in section 999A(c), a demonstration project under this 

subtitle relating to an ultra-deepwater technology or an ultra-deepwater 

architecture may be conducted in deepwater depths.

 (c) Intellectual Property Agreements.--If an award under this 

subtitle is made to a consortium (other than the program consortium), 

the consortium shall provide to the Secretary a signed contract agreed 

to by all members of the consortium describing the rights of each member 

to intellectual property used or developed under the award.

 (d) Technology Transfer.--Two and one-half percent of the amount of 

each award made under this subtitle shall be designated for technology 

transfer and outreach activities under this subtitle.

 (e) Cost Sharing Reduction for Independent Producers.--In applying 

the cost sharing requirements under section 988 to an award under this 

subtitle the Secretary may reduce or eliminate the non-Federal 

requirement if the Secretary determines that the

[[Page 119 STAT. 922]]

reduction is necessary and appropriate considering the technological 

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risks involved in the project.

 (f) Information Sharing.--All results of the research administered 

by the program consortium shall be made available to the public 

consistent with Department policy and practice on information sharing 

and intellectual property agreements.

SEC. 999D. <<NOTE: 42 USC 16374.>> ADVISORY COMMITTEES.

 (a) Ultra-Deepwater Advisory Committee.--

 (1) Establishment.-- <<NOTE: Deadline.>> Not later than 270 

 days after the date of enactment of this Act, the Secretary 

 shall establish an advisory committee to be known as the Ultra-

 Deepwater Advisory Committee.

 (2) Membership.--The Advisory Committee under this 

 subsection shall be composed of members appointed by the 

 Secretary, including--

 (A) individuals with extensive research experience 

 or operational knowledge of offshore natural gas and 

 other petroleum exploration and production;

 (B) individuals broadly representative of the 

 affected interests in ultra-deepwater natural gas and 

 other petroleum production, including interests in 

 environmental protection and safe operations;

 (C) no individuals who are Federal employees; and

 (D) no individuals who are board members, officers, 

 or employees of the program consortium.

 (3) Duties.--The Advisory Committee under this subsection 

 shall--

 (A) advise the Secretary on the development and 

 implementation of programs under this subtitle related 

 to ultra-deepwater natural gas and other petroleum 

 resources; and

 (B) carry out section 999B(e)(2)(B).

 (4) Compensation.--A member of the Advisory Committee under 

 this subsection shall serve without compensation but shall 

 receive travel expenses in accordance with applicable provisions 

 under subchapter I of chapter 57 of title 5, United States Code.

 (b) Unconventional Resources Technology Advisory Committee.--

 (1) Establishment.-- <<NOTE: Deadline.>> Not later than 270 

 days after the date of enactment of this Act, the Secretary 

 shall establish an advisory committee to be known as the 

 Unconventional Resources Technology Advisory Committee.

 (2) Membership.--The Secretary shall endeavor to have a 

 balanced representation of members on the Advisory Committee to 

 reflect the breadth of geographic areas of potential gas supply. 

 The Advisory Committee under this subsection shall be composed 

 of members appointed by the Secretary, including--

 (A) a majority of members who are employees or 

 representatives of independent producers of natural gas 

 and other petroleum, including small producers;

 (B) individuals with extensive research experience 

 or operational knowledge of unconventional natural gas 

 and other petroleum resource exploration and production;

[[Page 119 STAT. 923]]

 (C) individuals broadly representative of the 

 affected interests in unconventional natural gas and 

 other petroleum resource exploration and production, 

 including interests in environmental protection and safe 

 operations;

 (D) individuals with expertise in the various 

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 geographic areas of potential supply of unconventional 

 onshore natural gas and other petroleum in the United 

 States;

 (E) no individuals who are Federal employees; and

 (F) no individuals who are board members, officers, 

 or employees of the program consortium.

 (3) Duties.--The Advisory Committee under this subsection 

 shall--

 (A) advise the Secretary on the development and 

 implementation of activities under this subtitle related 

 to unconventional natural gas and other petroleum 

 resources; and

 (B) carry out section 999B(e)(2)(B).

 (4) Compensation.--A member of the Advisory Committee under 

 this subsection shall serve without compensation but shall 

 receive travel expenses in accordance with applicable provisions 

 under subchapter I of chapter 57 of title 5, United States Code.

 (c) Prohibition.--No advisory committee established under this 

section shall make recommendations on funding awards to particular 

consortia or other entities, or for specific projects.

SEC. 999E. <<NOTE: 42 USC 16375.>> LIMITS ON PARTICIPATION.

 An entity shall be eligible to receive an award under this subtitle 

only if the Secretary finds--

 (1) that the entity's participation in the program under 

 this subtitle would be in the economic interest of the United 

 States; and

 (2) that either--

 (A) the entity is a United States-owned entity 

 organized under the laws of the United States; or

 (B) the entity is organized under the laws of the 

 United States and has a parent entity organized under 

 the laws of a country that affords--

 (i) to United States-owned entities 

 opportunities, comparable to those afforded to any 

 other entity, to participate in any cooperative 

 research venture similar to those authorized under 

 this subtitle;

 (ii) to United States-owned entities local 

 investment opportunities comparable to those 

 afforded to any other entity; and

 (iii) adequate and effective protection for 

 the intellectual property rights of United States-

 owned entities.

SEC. 999F. <<NOTE: 42 USC 16376.>> SUNSET.

 The authority provided by this subtitle shall terminate on September 

30, 2014.

SEC. 999G. <<NOTE: 42 USC 16377.>> DEFINITIONS.

 In this subtitle:

 (1) Deepwater.--The term ``deepwater'' means a water depth 

 that is greater than 200 but less than 1,500 meters.

 (2) Independent producer of oil or gas.--

[[Page 119 STAT. 924]]

 (A) In general.--The term ``independent producer of 

 oil or gas'' means any person that produces oil or gas 

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 other than a person to whom subsection (c) of section 

 613A of the Internal Revenue Code of 1986 does not apply 

 by reason of paragraph (2) (relating to certain 

 retailers) or paragraph (4) (relating to certain 

 refiners) of section 613A(d) of such Code.

 (B) Rules for applying paragraphs (2) and (4) of 

 section 613a(d).--For purposes of subparagraph (A), 

 paragraphs (2) and (4) of section 613A(d) of the 

 Internal Revenue Code of 1986 shall be applied by 

 substituting ``calendar year'' for ``taxable year'' each 

 place it appears in such paragraphs.

 (3) Program administration funds.--The term ``program 

 administration funds'' means funds used by the program 

 consortium to administer the program under this subtitle, but 

 not to exceed 10 percent of the total funds allocated under 

 paragraphs (1) through (3) of section 999H(d).

 (4) Program consortium.--The term ``program consortium'' 

 means the consortium selected under section 999B(d).

 (5) Program research funds.--The term ``program research 

 funds'' means funds awarded to research performers by the 

 program consortium consistent with the annual plan.

 (6) Remote or inconsequential.--The term ``remote or 

 inconsequential'' has the meaning given that term in regulations 

 issued by the Office of Government Ethics under section 

 208(b)(2) of title 18, United States Code.

 (7) Small producer.--The term ``small producer'' means an 

 entity organized under the laws of the United States with 

 production levels of less than 1,000 barrels per day of oil 

 equivalent.

 (8) Ultra-deepwater.--The term ``ultra-deepwater'' means a 

 water depth that is equal to or greater than 1,500 meters.

 (9) Ultra-deepwater architecture.--The term ``ultra-

 deepwater architecture'' means the integration of technologies 

 for the exploration for, or production of, natural gas or other 

 petroleum resources located at ultra-deepwater depths.

 (10) Ultra-deepwater technology.--The term ``ultra-deepwater 

 technology'' means a discrete technology that is specially 

 suited to address one or more challenges associated with the 

 exploration for, or production of, natural gas or other 

 petroleum resources located at ultra-deepwater depths.

 (11) Unconventional natural gas and other petroleum 

 resource.--The term ``unconventional natural gas and other 

 petroleum resource'' means natural gas and other petroleum 

 resource located onshore in an economically inaccessible 

 geological formation, including resources of small producers.

SEC. 999H. <<NOTE: 42 USC 16378.>> FUNDING.

 (a) Oil and Gas Lease Income.--For each of fiscal years 2007 through 

2017, from any Federal royalties, rents, and bonuses derived from 

Federal onshore and offshore oil and gas leases issued under the Outer 

Continental Shelf Lands Act (43 U.S.C. 1331 et seq.) and the Mineral 

Leasing Act (30 U.S.C. 181 et seq.) which are deposited in the Treasury, 

and after distribution of any such funds as described in subsection (c), 

$50,000,000 shall be deposited into the Ultra-Deepwater and 

Unconventional Natural Gas and

[[Page 119 STAT. 925]]

Other Petroleum Research Fund (in this section referred to as the 

``Fund''). For purposes of this section, the term ``royalties'' excludes 

proceeds from the sale of royalty production taken in kind and royalty 

production that is transferred under section 27(a)(3) of the Outer 

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Continental Shelf Lands Act (43 U.S.C. 1353(a)(3)).

 (b) Obligational Authority.--Monies in the Fund shall be available 

to the Secretary for obligation under this part without fiscal year 

limitation, to remain available until expended.

 (c) Prior Distributions.--The distributions described in subsection 

(a) are those required by law--

 (1) to States and to the Reclamation Fund under the Mineral 

 Leasing Act (30 U.S.C. 191(a)); and

 (2) to other funds receiving monies from Federal oil and gas 

 leasing programs, including--

 (A) any recipients pursuant to section 8(g) of the 

 Outer Continental Shelf Lands Act (43 U.S.C. 1337(g));

 (B) the Land and Water Conservation Fund, pursuant 

 to section 2(c) of the Land and Water Conservation Fund 

 Act of 1965 (16 U.S.C. 4601-5(c));

 (C) the Historic Preservation Fund, pursuant to 

 section 108 of the National Historic Preservation Act 

 (16 U.S.C. 470h); and

 (D) the coastal impact assistance program 

 established under section 31 of the Outer Continental 

 Shelf Lands Act (as amended by section 384).

 (d) Allocation.--Amounts obligated from the Fund under subsection 

(a)(1) in each fiscal year shall be allocated as follows:

 (1) 35 percent shall be for activities under section 

 999A(b)(1).

 (2) 32.5 percent shall be for activities under section 

 999A(b)(2).

 (3) 7.5 percent shall be for activities under section 

 999A(b)(3).

 (4) 25 percent shall be for complementary research under 

 section 999A(b)(4) and other activities under section 999A(b) to 

 include program direction funds, overall program oversight, 

 contract management, and the establishment and operation of a 

 technical committee to ensure that in-house research activities

 funded under section 999A(b)(4) are technically complementary 

 to, and not duplicative of, research conducted under paragraphs 

 (1), (2), and (3) of section 999A(b).

 (e) Authorization of Appropriations.--In addition to other amounts 

that are made available to carry out this section, there is authorized 

to be appropriated to carry out this section $100,000,000 for each of 

fiscal years 2007 through 2016.

 (f) Fund.--There is hereby established in the Treasury of the United 

States a separate fund to be known as the ``Ultra-Deepwater and 

Unconventional Natural Gas and Other Petroleum Research Fund''.

[[Page 119 STAT. 926]]

 TITLE X--DEPARTMENT OF ENERGY MANAGEMENT

SEC. 1001. <<NOTE: 42 USC 16391.>> IMPROVED TECHNOLOGY TRANSFER OF 

 ENERGY TECHNOLOGIES.

 (a) Technology <<NOTE: Establishment.>> Transfer Coordinator.--The 

Secretary shall appoint a Technology Transfer Coordinator to be the 

principal advisor to the Secretary on all matters relating to technology 

transfer and commercialization.

 (b) Qualifications.--The Coordinator shall be an individual who, by 

reason of professional background and experience, is specially qualified 

to advise the Secretary on matters pertaining to technology transfer at 

the Department.

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 (c) Duties of the Coordinator.--The Coordinator shall oversee--

 (1) the activities of the Technology Transfer Working Group 

 established under subsection (d);

 (2) the expenditure of funds allocated for technology 

 transfer within the Department;

 (3) the activities of each technology partnership ombudsman 

 appointed under section 11 of the Technology Transfer 

 Commercialization Act of 2000 (42 U.S.C. 7261c); and

 (4) efforts to engage private sector entities, including 

 venture capital companies.

 (d) Technology <<NOTE: Establishment.>> Transfer Working Group.--The 

Secretary shall establish a Technology Transfer Working Group, which 

shall consist of representatives of the National Laboratories and 

single-purpose research facilities, to--

 (1) coordinate technology transfer activities occurring at 

 National Laboratories and single-purpose research facilities;

 (2) exchange information about technology transfer 

 practices, including alternative approaches to resolution of 

 disputes involving intellectual property rights and other 

 technology transfer matters; and

 (3) develop and disseminate to the public and prospective 

 technology partners information about opportunities and 

 procedures for technology transfer with the Department, 

 including opportunities and procedures related to alternative 

 approaches to resolution of disputes involving intellectual 

 property rights and other technology transfer matters.

 (e) Technology Commercialization Fund.--The Secretary shall 

establish an Energy Technology Commercialization Fund, using 0.9 percent 

of the amount made available to the Department for applied energy 

research, development, demonstration, and commercial application for 

each fiscal year, to be used to provide matching funds with private 

partners to promote promising energy technologies for commercial 

purposes.

 (f) Technology Transfer Responsibility.--Nothing in this section 

affects the technology transfer responsibilities of Federal employees 

under the Stevenson-Wydler Technology Innovation Act of 1980 (15 U.S.C. 

3701 et seq.).

 (g) Planning and Reporting.--

 (1) In general.--Not later than 180 days after the date of 

 enactment of this Act, the Secretary shall submit to Congress a 

 technology transfer execution plan.

[[Page 119 STAT. 927]]

 (2) Updates.--Each year after the submission of the plan 

 under paragraph (1), the Secretary shall submit to Congress an 

 updated execution plan and reports that describe progress toward 

 meeting goals set forth in the execution plan and the funds 

 expended under subsection (e).

SEC. 1002. <<NOTE: 42 USC 16392.>> TECHNOLOGY INFRASTRUCTURE PROGRAM.

 (a) Definitions.--In this section:

 (1) Program.--The term ``Program'' means the Technology 

 Infrastructure Program established under subsection (b).

 (2) Technology cluster.--The term ``technology cluster'' 

 means a concentration of technology-related business concerns, 

 institutions of higher education, or nonprofit institutions, 

 that reinforce each other's performance in the areas of 

 technology development through formal or informal relationships.

 (3) Technology-related business concern.--The term 

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 ``technology-related business concern'' means a for-profit 

 corporation, company, association, firm, partnership, or small 

 business concern that--

 (A) conducts scientific or engineering research;

 (B) develops new technologies;

 (C) manufactures products based on new technologies; 

 or

 (D) performs technological services.

 (b) Establishment.--The Secretary shall establish a Technology 

Infrastructure Program in accordance with this section.

 (c) Purpose.--The purpose of the Program shall be to improve the 

ability of National Laboratories and single-purpose research facilities 

to support departmental missions by--

 (1) stimulating the development of technology clusters that 

 can support departmental missions at the National Laboratories 

 or single-purpose research facilities;

 (2) improving the ability of National Laboratories and 

 single-purpose research facilities to leverage and benefit from 

 commercial research, technology, products, processes, and 

 services; and

 (3) encouraging the exchange of scientific and technological 

 expertise between--

 (A) National Laboratories or single-purpose research 

 facilities; and

 (B) entities that can support departmental missions 

 at the National Laboratories or single-purpose research 

 facilities, such as--

 (i) institutions of higher education;

 (ii) technology-related business concerns;

 (iii) nonprofit institutions; and

 (iv) agencies of State, tribal, or local 

 governments.

 (d) Projects.--The Secretary shall authorize the director of each 

National Laboratory or single-purpose research facility to implement the 

Program at the National Laboratory or facility through one or more 

projects that meet the requirements of subsections (e) and (f).

 (e) Program Requirements.--

 (1) In general.--Each project funded under this section 

 shall meet the requirements of this subsection.

 (2) Entities.--Each project shall include at least one of 

 each of the following entities:

[[Page 119 STAT. 928]]

 (A) A business.

 (B) An institution of higher education.

 (C) A nonprofit institution.

 (D) An agency of a State, local, or tribal 

 government.

 (3) Cost-sharing.--

 (A) In general.--The costs of carrying out projects 

 under this section shall be shared in accordance with 

 section 988.

 (B) Sources.--The calculation of costs paid by the 

 non-Federal sources for a project shall include cash, 

 personnel, services, equipment, and other resources 

 expended on the project after the commencement of the 

 project.

 (C) Research and development expenses.--Independent 

 research and development expenses of Government 

 contractors that qualify for reimbursement under section 

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 31.205-18(e) of title 48, Code of Federal Regulations, 

 issued pursuant to section 25(c)(1) of the Office of 

 Federal Procurement Policy Act (41 U.S.C. 421(c)(1)), 

 may be credited towards costs paid by non-Federal 

 sources to a project, if the expenses meet the other 

 requirements of this section.

 (4) Competitive selection.--A project under this section 

 shall be competitively selected using procedures determined by 

 the Secretary.

 (5) Accounting.--Any participant that receives funds under 

 this section may use generally accepted accounting principles 

 for maintaining accounts, books, and records relating to the 

 project.

 (6) Duration.--No Federal funds shall be made available 

 under this section for a construction project or for any project 

 with a duration of more than 5 years.

 (f) Selection Criteria.--

 (1) Departmental missions.--The Secretary shall allocate 

 funds under this section only if the Director of the National 

 Laboratory or single-purpose research facility managing the 

 project determines that the project is likely to improve the 

 ability of the National Laboratory or single-purpose research 

 facility to achieve technical success in meeting departmental 

 missions.

 (2) Other criteria.--In selecting a project to receive 

 Federal funds, the Secretary shall consider--

 (A) the potential of the project to promote the 

 development of a commercially sustainable technology 

 cluster following the period of investment by the 

 Department, which will derive most of the demand for its 

 products or services from the private sector, and which 

 will support departmental missions at the participating 

 National Laboratory or single-purpose research facility;

 (B) the potential of the project to promote the use 

 of commercial research, technology, products, processes, 

 and services by the participating National Laboratory or 

 single-purpose research facility to achieve its mission 

 or the commercial development of technological 

 innovations made at the participating National 

 Laboratory or single-purpose research facility;

 (C) the extent to which the project involves a wide 

 variety and number of institutions of higher education,

[[Page 119 STAT. 929]]

 nonprofit institutions, and technology-related business 

 concerns that can support the missions of the 

 participating National Laboratory or single-purpose 

 research facility and that will make substantive 

 contributions to achieving the goals of the project;

 (D) the extent to which the project focuses on 

 promoting the development of technology-related business 

 concerns that are small businesses or involves such 

 small businesses substantively in the project; and

 (E) such other criteria as the Secretary determines 

 to be appropriate.

 (g) Allocation.--In allocating funds for projects approved under 

this section, the Secretary shall provide--

 (1) the Federal share of the project costs; and

 (2) additional funds to the National Laboratory or single-

 purpose research facility managing the project to permit the 

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 National Laboratory or single-purpose research facility to carry 

 out activities relating to the project, and to coordinate the 

 activities with the project.

 (h) Report to Congress.--Not later than July 1, 2008, the Secretary 

shall submit to Congress a report on whether the Program should be 

continued and, if so, how the program should be managed.

 (i) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary for activities under this section 

$10,000,000 for each of fiscal years 2006 through 2008.

SEC. 1003. <<NOTE: 42 USC 16393.>> SMALL BUSINESS ADVOCACY AND 

 ASSISTANCE.

 (a) Small Business Advocate.--The Secretary shall require the 

Director of each National Laboratory, and may require the Director of a 

single-purpose research facility, to designate a small business advocate 

to--

 (1) increase the participation of small business concerns, 

 including socially and economically disadvantaged small business 

 concerns (as defined in section 8(a)(4) of the Small Business 

 Act (15 U.S.C. 637(a)(4))), in procurement, collaborative 

 research, technology licensing, and technology transfer 

 activities conducted by the National Laboratory or single-

 purpose research facility;

 (2) <<NOTE: Reports.>> report to the Director of the 

 National Laboratory or single-purpose research facility on the 

 actual participation of small business concerns in procurement 

 and collaborative research along with recommendations, if 

 appropriate, on how to improve participation;

 (3) make available to small business concerns training, 

 mentoring, and information on how to participate in procurement 

 and collaborative research activities;

 (4) increase the awareness inside the National Laboratory or 

 single-purpose research facility of the capabilities and 

 opportunities presented by small business concerns; and

 (5) establish <<NOTE: Guidelines. Reports.>> guidelines for 

 the program under subsection (b) and report on the effectiveness 

 of the program to the Director of the National Laboratory or 

 single-purpose research facility.

 (b) Establishment of Small Business Assistance Program.--The 

Secretary shall require the Director of each National Laboratory, and 

may require the Director of a single-purpose

[[Page 119 STAT. 930]]

research facility, to establish a program to provide small business 

concerns with--

 (1) assistance directed at making the small business 

 concerns more effective and efficient subcontractors or 

 suppliers to the National Laboratory or single-purpose research 

 facilities; or

 (2) general technical assistance, the cost of which shall 

 not exceed $10,000 per instance of assistance, to improve the 

 products or services of the small business concern.

 (c) Use of Funds.--None of the funds expended under subsection (b) 

may be used for direct grants to small business concerns.

 (d) Authorization of Appropriations.--There is authorized to be 

appropriated to the Secretary for activities under this section 

$5,000,000 for each of fiscal years 2006 through 2008.

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SEC. 1004. <<NOTE: 42 USC 16394.>> OUTREACH.

 The Secretary shall ensure that each program authorized by this Act 

or an amendment made by this Act includes an outreach component to 

provide information, as appropriate, to manufacturers, consumers, 

engineers, architects, builders, energy service companies, institutions 

of higher education, facility planners and managers, State and local 

governments, and other entities.

SEC. 1005. <<NOTE: Applicability. 42 USC 16395.>> RELATIONSHIP TO OTHER 

 LAWS.

 Except as otherwise provided in this Act or an amendment made by 

this Act, the Secretary shall carry out the research, development, 

demonstration, and commercial application programs, projects, and 

activities authorized by this Act or an amendment made by this Act in 

accordance with the applicable provisions of--

 (1) the Atomic Energy Act of 1954 (42 U.S.C. 2011 et seq.);

 (2) the Federal Nonnuclear Energy Research and Development 

 Act of 1974 (42 U.S.C. 5901 et seq.);

 (3) the Energy Policy Act of 1992 (42 U.S.C. 13201 et seq.);

 (4) the Stevenson-Wydler Technology Innovation Act of 1980 

 (15 U.S.C. 3701 et seq.);

 (5) chapter 18 of title 35, United States Code (commonly 

 known as the ``Bayh-Dole Act''); and

 (6) any other Act under which the Secretary is authorized to 

 carry out the programs, projects, and activities.

SEC. 1006. <<NOTE: Government organization and employees.>> IMPROVED 

 COORDINATION AND MANAGEMENT OF CIVILIAN SCIENCE AND 

 TECHNOLOGY PROGRAMS.

 (a) Effective Top-Level Coordination of Research and Development 

Programs.--Section 202 of the Department of Energy Organization Act (42 

U.S.C. 7132) is amended by striking subsection (b) and inserting the 

following:

 ``(b)(1) There <<NOTE: President.>> shall be in the Department an 

Under Secretary for Science, who shall be appointed by the President, by 

and with the advice and consent of the Senate.

 ``(2) The Under Secretary shall be compensated at the rate provided 

for level III of the Executive Schedule under section 5314 of title 5, 

United States Code.

 ``(3) The Under Secretary for Science shall be appointed from among 

persons who--

[[Page 119 STAT. 931]]

 ``(A) have extensive background in scientific or engineering 

 fields; and

 ``(B) are well qualified to manage the civilian research and 

 development programs of the Department.

 ``(4) The Under Secretary for Science shall--

 ``(A) serve as the Science and Technology Advisor to the 

 Secretary;

 ``(B) monitor the research and development programs of the 

 Department in order to advise the Secretary with respect to any 

 undesirable duplication or gaps in the programs;

 ``(C) advise the Secretary with respect to the well-being 

 and management of the multipurpose laboratories under the 

 jurisdiction of the Department;

 ``(D) advise the Secretary with respect to education and 

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 training activities required for effective short- and long-term 

 basic and applied research activities of the Department;

 ``(E) advise the Secretary with respect to grants and other 

 forms of financial assistance required for effective short- and 

 long-term basic and applied research activities of the 

 Department;

 ``(F) advise the Secretary with respect to long-term 

 planning, coordination, and development of a strategic framework 

 for Department research and development activities; and

 ``(G) carry out such additional duties assigned to the Under 

 Secretary by the Secretary relating to basic and applied 

 research, including supervision or support of research 

 activities carried out by any of the Assistant Secretaries 

 designated by section 203 of this Act, as the Secretary 

 considers advantageous.''.

 (b) Additional Assistant Secretary Position.--

 (1) In general.--Section 203(a) of the Department of Energy 

 Organization Act (42 U.S.C. 7133(a)) is amended in the first 

 sentence by striking ``six Assistant Secretaries'' and inserting 

 ``7 Assistant Secretaries''.

 (2) Assistant secretary level.--It is the sense of Congress 

 that the leadership for departmental missions in nuclear energy 

 should be at the Assistant Secretary level.

 (c) Technical and Conforming Amendments.--

 (1) Section 202 of the Department of Energy Organization Act 

 (42 U.S.C. 7132) is amended by adding at the end the following:

 ``(d)(1) There <<NOTE: President.>> shall be in the Department an 

Under Secretary, who shall be appointed by the President, by and with 

the advice and consent of the Senate, and who shall perform such 

functions and duties as the Secretary shall prescribe, consistent with 

this section.

 ``(2) The Under Secretary shall be compensated at the rate provided 

for level III of the Executive Schedule under section 5314 of title 5, 

United States Code.

 ``(e)(1) There <<NOTE: President.>> shall be in the Department a 

General Counsel, who shall be appointed by the President, by and with 

the advice and consent of the Senate, and who shall perform such 

functions and duties as the Secretary shall prescribe.

 ``(2) The General Counsel shall be compensated at the rate provided 

for level IV of the Executive Schedule under section 5315 of title 5, 

United States Code.''.

[[Page 119 STAT. 932]]

 (2) Section 5314 of title 5, United States Code, is amended 

 by striking ``Under Secretaries of Energy (2)'' and inserting 

 ``Under Secretaries of Energy (3)''.

 (3) Section 5315 of title 5, United States Code, is amended 

 by striking ``Assistant Secretaries of Energy (6)'' and 

 inserting ``Assistant Secretaries of Energy (7)''.

 (4) Section 209(b) of the Department of Energy Organization 

 Act (42 U.S.C. 7139(b)) is amended by striking paragraph (6) and 

 inserting the following:

 ``(6) to carry out such additional duties assigned to the 

 Office by the Secretary.''.

SEC. 1007. OTHER TRANSACTIONS AUTHORITY.

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 Section 646 of the Department of Energy Organization Act (42 U.S.C. 

7256) is amended by adding at the end the following:

 ``(g)(1) In addition to authority granted to the Secretary under any 

other provision of law, the Secretary may exercise the same authority to 

enter into transactions (other than contracts, cooperative agreements, 

and grants), subject to the same terms and conditions as the Secretary 

of Defense under section 2371 of title 10, United States Code (other 

than subsections (b) and (f) of that section).

 ``(2) In applying section 2371 of title 10, United States Code, to 

the Secretary under paragraph (1)--

 ``(A) the term `basic' shall be replaced by the term 

 `research';

 ``(B) the term `applied' shall be replaced by the term 

 `development'; and

 ``(C) the terms `advanced research projects' and `advanced 

 research' shall be replaced by the term `demonstration 

 projects'.

 ``(3) The authority of the Secretary under paragraph (1) shall not 

be subject to--

 ``(A) section 9 of the Federal Nonnuclear Energy Research 

 and Development Act of 1974 (42 U.S.C. 5908); or

 ``(B) section 152 of the Atomic Energy Act of 1954 (42 

 U.S.C. 2182).

 ``(4)(A) The Secretary shall use such competitive, merit-based 

selection procedures in entering into transactions under paragraph (1), 

as the Secretary determines in writing to be practicable.

 ``(B) A transaction under paragraph (1) shall relate to a research, 

development, or demonstration project only if the Secretary determines 

in writing that the use of a standard contract, grant, or cooperative 

agreement for the project is not feasible or appropriate.

 ``(5) The Secretary may protect from disclosure, for up to 5 years 

after the date on which the information is developed, any information 

developed pursuant to a transaction under paragraph (1) that would be 

protected from disclosure under section 552(b)(4) of title 5, United 

States Code, if obtained from a person other than a Federal agency.

 ``(6)(A) Not <<NOTE: Deadline. Guidelines.>> later than 90 days 

after the date of enactment of this subsection, the Secretary shall 

issue guidelines for transactions under paragraph (1).

 ``(B) The <<NOTE: Federal Register, publication.>> guidelines shall 

be published in the Federal Register for public comment in accordance 

with rulemaking procedures of the Department.

[[Page 119 STAT. 933]]

 ``(C) The Secretary shall not have authority to carry out 

transactions under paragraph (1) until the guidelines for transactions 

required under subparagraph (A) are final.

 ``(7) The <<NOTE: Reports.>> annual report of the head of an 

executive agency under section 2371(h) of title 10, United States Code, 

shall be submitted to Congress.

 ``(8)(A) In this paragraph, the term `nontraditional Government 

contractor' has the meaning given the term `nontraditional defense 

contractor' in section 845(f) of the National Defense Authorization Act 

for Fiscal Year 1994 (Public Law 103-160; 10 U.S.C. 2371 note).

 ``(B) Not <<NOTE: Deadline. Reports.>> later than 1 year after the 

date on which the final guidelines are published under paragraph (6), 

the Comptroller General of the United States shall submit to Congress a 

report describing--

 ``(i) the use by the Department of authorities under this 

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 section, including the ability to attract nontraditional 

 Government contractors; and

 ``(ii) whether additional safeguards are necessary to carry 

 out the authorities.

 ``(9) The authority of the Secretary under this subsection may be 

delegated only to an officer of the Department who is appointed by the 

President by and with the advice and consent of the Senate.

 ``(10) Notwithstanding <<NOTE: Termination date.>> any other 

provision of law, the authority to enter into transactions under 

paragraph (1) shall terminate on September 30, 2010.''.

SEC. 1008. <<NOTE: 42 USC 16396.>> PRIZES FOR ACHIEVEMENT IN GRAND 

 CHALLENGES OF SCIENCE AND TECHNOLOGY.

 (a) Authority.--The Secretary may carry out a program to award cash 

prizes in recognition of breakthrough achievements in research, 

development, demonstration, and commercial application that have the 

potential for application to the performance of the mission of the 

Department.

 (b) Competition Requirements.--The program under subsection (a) may 

include prizes for the achievement of goals articulated by the Secretary 

in a specific area through a widely advertised solicitation of 

submission of results for research, development, demonstration, or 

commercial application projects.

 (c) Prizes for Processes and Technologies to Reduce Dependence on 

Imported Oil.--The Secretary, in cooperation with the Freedom Prize 

Foundation, shall support a program of awarding prizes, to be known as 

Freedom Prizes, to encourage and recognize the development and 

deployment of processes and technologies that serve to reduce the 

dependence of the United States on imported oil.

 (d) Relationship to Other Authority.--The program under subsection 

(a) may be carried out in conjunction with or in addition to the 

exercise of any other authority of the Secretary to acquire, support, or 

stimulate research, development, demonstration, or commercial 

application projects.

 (e) Authorization of Appropriations.--There are authorized to be 

appropriated--

 (1) $10,000,000 to carry out the program under subsection 

 (a); and

 (2) $5,000,000 to carry out the program under subsection 

 (c).

[[Page 119 STAT. 934]]

SEC. 1009. TECHNICAL CORRECTIONS.

 (a) Coal Research and Development.--

 (1) In general.--Public Law 86-599 (30 U.S.C. 661 et seq.) 

 is amended--

 (A) by striking the first section (30 U.S.C. 661) 

 and inserting the following:

 ``Sec. 1. (a) This Act may be cited as the `Coal Research and 

Development Act of 1960'.

 ``(b) In this Act:

 ``(1) The term `research' means scientific, technical, and 

 economic research and the practical application of that 

 research.

 ``(2) The term `Secretary' means the Secretary of Energy.'';

 (B) in section 2 (30 U.S.C. 662), by striking 

 ``shall establish within'' and all that follows through 

 ``such Office'';

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 (C) by striking sections 3, 4, and 7 (30 U.S.C. 663, 

 664, 667); and

 (D) by redesignating sections 5, 6, and 8 (30 U.S.C. 

 665, 666, 668) as sections 3, 4, and 5, respectively.

 (2) Patents.--Section 210(a)(8) of title 35, United States 

 Code, is amended by striking ``Coal Research Development Act of 

 1960'' and inserting ``Coal Research and Development Act of 

 1960''.

 (b) Nonnuclear Energy Research and Development.--

 (1) Short title; definitions.--Section 1 of the Federal 

 Nonnuclear Energy Research and Development Act of 1974 (42 

 U.S.C. 5902) is amended to read as follows:

 ``short title and definitions

 ``Sec. 1. <<NOTE: 42 USC 5901 note.>> (a) This Act may be cited as 

the `Federal Nonnuclear Energy Research and Development Act of 1974'.

 ``(b) In this Act:

 ``(1) The term `Department' means the Department of Energy.

 ``(2) The term `Secretary' means the Secretary of Energy.''.

 (2) Statement of policy.--Section 3(b) of the Federal 

 Nonnuclear Energy Research and Development Act of 1974 (42 

 U.S.C. 5902(b)) is amended--

 (A) in paragraph (1), by striking ``Energy Research 

 and Development Administration'' and inserting 

 ``Department'';

 (B) in paragraph (2), by striking ``Administrator of 

 the Energy Research and Development Administration 

 (hereinafter in this Act referred to as the 

 `Administrator')'' and inserting ``Secretary''; and

 (C) in paragraph (3)--

 (i) by striking ``Administrator'' and 

 inserting ``Secretary''; and

 (ii) by inserting ``Demonstration'' after 

 ``Cooling''.

 (3) Duties and authorities.--Section 4 of the Federal 

 Nonnuclear Energy Research and Development Act of 1974 (42 

 U.S.C. 5903) is amended--

 (A) by striking the section heading and inserting 

 the following: ``duties and authorities of the 

 secretary''; and

 (B) in the matter preceding subsection (a), by 

 striking ``Administrator'' and inserting ``Secretary''.

[[Page 119 STAT. 935]]

 (4) Comprehensive planning and programming.--Section 6 of 

 the Federal Nonnuclear Energy Research and Development Act of 

 1974 (42 U.S.C. 5905) is amended--

 (A) by striking ``Administrator'' each place it 

 appears and inserting ``Secretary''; and

 (B) in subsection (b)(3)--

 (i) in subparagraph (I), by inserting 

 ``Demonstration'' after ``Cooling''; and

 (ii) in subparagraph (L), by inserting 

 ``Energy'' after ``Solar''.

 (5) Forms of federal assistance.--Section 7 of the Federal 

 Nonnuclear Energy Research and Development Act of 1974 (42 

 U.S.C. 5906) is amended--

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 (A) by striking ``Administrator'' each place it 

 appears and inserting ``Secretary''; and

 (B) in subsection (a)(4), by striking ``of the 

 section''.

 (6) Demonstrations.--Section 8 of the Federal Nonnuclear 

 Energy Research and Development Act of 1974 (42 U.S.C. 5907) is 

 amended--

 (A) in subsections (a) through (c), by striking 

 ``Administrator'' each place it appears and inserting 

 ``Secretary'';

 (B) in subsection (d)--

 (i) in the first sentence of paragraph (1), by 

 inserting ``of the Energy Research and Development 

 Administration'' after ``Administrator''; and

 (ii) in paragraph (3), by striking 

 ``Administrator'' and inserting ``Secretary''; and

 (C) in subsection (f)--

 (i) by striking ``Administrator'' each place 

 it appears and inserting ``Secretary''; and

 (ii) in the proviso of the first sentence, by 

 striking ``Administrator's'' and inserting 

 ``Secretary's''.

 (7) Patent policy.--Section 9 of the Federal Nonnuclear 

 Energy Research and Development Act of 1974 (42 U.S.C. 5908) is 

 amended--

 (A) by striking ``Administration'' each place it 

 appears and inserting ``Department'';

 (B) by striking ``Administrator'' each place it 

 appears and inserting ``Secretary''; and

 (C) in subsection (c)(3), by striking 

 ``Administration's'' and inserting ``Department's''.

 (8) Acquisition of essential materials.--Section 12 of the 

 Federal Nonnuclear Energy Research and Development Act of 1974 

 (42 U.S.C. 5911) is amended by striking subsection (b) and 

 inserting the following:

 ``(b) A rule or order under subsection (a) shall be considered to be 

a major rule subject to chapter 8 of title 5, United States Code.''.

 (9) Water resource evaluation.--Section 13 of the Federal 

 Nonnuclear Energy Research and Development Act of 1974 (42 

 U.S.C. 5912) is amended by striking ``Administrator'' each place 

 it appears and inserting ``Secretary''.

 (10) Authorization of appropriations.--Section 16 of the 

 Federal Nonnuclear Energy Research and Development Act of 1974 

 (42 U.S.C. 5915) is amended--

 (A) by striking the section heading and inserting 

 the following: ``authorization of appropriations'';

[[Page 119 STAT. 936]]

 (B) by striking ``(a) There may be appropriated to 

 the Administrator'' and inserting ``There may be 

 appropriated to the Secretary''; and

 (C) by striking subsections (b) and (c).

 (11) Central source of nonnuclear energy information.--

 Section 17 of the Federal Nonnuclear Energy Research and 

 Development Act of 1974 (42 U.S.C. 5916) is amended--

 (A) by striking ``Administrator'' each place it 

 appears and inserting ``Secretary'';

 (B) in the first sentence, by striking 

 ``Administrator's'';

 (C) in the second sentence, by striking ``he'' and 

 inserting ``the Secretary'';

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 (D) in the third sentence--

 (i) in paragraph (2) of the first proviso, by 

 striking ``section 1905 or title 18'' and 

 inserting ``section 1905 of title 18''; and

 (ii) in subparagraph (B) of the second 

 proviso--

 (I) by striking ``the Federal Energy 

 Administration,'';

 (II) by striking ``the Federal Power 

 Commission,'' and inserting ``the 

 Federal Energy Regulatory Commission''; 

 and

 (III) by striking ``General 

 Accounting Office'' and inserting 

 ``Government Accountability Office''; 

 and

 (E) in the last sentence, by inserting ``or ranking 

 minority member'' after ``chairman''.

 (12) Energy information, loan guarantees, and financial 

 support.--Sections 18 through 20 of the Federal Nonnuclear 

 Energy Research and Development Act of 1974 (42 U.S.C. 5917 

 through 5920) are repealed.

 (c) Stevenson-Wydler Technology Innovation Act of 1980.--Section 20 

of the Stevenson-Wydler Technology Innovation Act of 1980 (15 U.S.C. 

3712) is amended by striking ``and the National Science Foundation'' and 

inserting ``, the Secretary of Energy, and the Director of the National 

Science Foundation''.

SEC. 1010. <<NOTE: Deadline. Reports.>> UNIVERSITY COLLABORATION.

 Not later than 2 years after the date of enactment of this Act, the 

Secretary shall transmit to the Congress a report that examines the 

feasibility of promoting collaborations between major universities and 

other colleges and universities in grants, contracts, and cooperative 

agreements made by the Secretary for energy projects. For purposes of 

this section, major universities are schools listed by the Carnegie 

Foundation as Doctoral Research Extensive Universities. The Secretary 

shall also consider providing incentives to increase the inclusion of 

small institutions of higher education, including minority-serving 

institutions, in energy grants, contracts, and cooperative agreements.

SEC. 1011. SENSE OF CONGRESS.

 It is the sense of Congress that--

 (1) the Secretary should develop and implement more 

 stringent procurement and inventory controls, including controls 

 on the purchase card program, to prevent waste, fraud, and abuse 

 of taxpayer funds by employees and contractors of the 

 Department; and

[[Page 119 STAT. 937]]

 (2) the Department's Inspector General should continue to 

 closely review purchase card purchases and other procurement and 

 inventory practices at the Department.

 TITLE XI--PERSONNEL AND TRAINING

SEC. 1101. <<NOTE: 42 USC 16411.>> WORKFORCE TRENDS AND TRAINEESHIP 

 GRANTS.

 (a) Definitions.--In this section:

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 (1) Energy technology industry.--The term ``energy 

 technology industry'' includes--

 (A) a renewable energy industry;

 (B) a company that develops or commercializes a 

 device to increase energy efficiency;

 (C) the oil and gas industry;

 (D) the nuclear power industry;

 (E) the coal industry;

 (F) the electric utility industry; and

 (G) any other industrial sector, as the Secretary 

 determines to be appropriate.

 (2) Skilled technical personnel.--The term ``skilled 

 technical personnel'' means--

 (A) journey- and apprentice-level workers who are 

 enrolled in, or have completed, a federally-recognized 

 or State-recognized apprenticeship program; and

 (B) other skilled workers in energy technology 

 industries, as determined by the Secretary.

 (b) Workforce Trends.--

 (1) Monitoring.--The Secretary, in consultation with, and 

 using data collected by, the Secretary of Labor, shall monitor 

 trends in the workforce of--

 (A) skilled technical personnel that support energy 

 technology industries; and

 (B) electric power and transmission engineers.

 (2) Report on trends.--Not later than 1 year after the date 

 of enactment of this Act, the Secretary shall submit to Congress 

 a report on current trends under paragraph (1), with 

 recommendations (as appropriate) to meet the future labor 

 requirements for the energy technology industries.

 (3) Report on shortage.--As soon as practicable after the 

 date on which the Secretary identifies or predicts a significant 

 national shortage of skilled technical personnel in one or more 

 energy technology industries, the Secretary shall submit to 

 Congress a report describing the shortage.

 (c) Traineeship Grants for Skilled Technical Personnel.--The 

Secretary, in consultation with the Secretary of Labor, may establish 

programs in the appropriate offices of the Department under which the 

Secretary provides grants to enhance training (including distance 

learning) for any workforce category for which a shortage is identified 

or predicted under subsection (b)(2).

 (d) Authorization of Appropriations.--There is authorized to be 

appropriated to carry out this section $20,000,000 for each of fiscal 

years 2006 through 2008.

[[Page 119 STAT. 938]]

SEC. 1102. EDUCATIONAL PROGRAMS IN SCIENCE AND MATHEMATICS.

 (a) Science Education Enhancement Fund.--Section 3164 of the 

Department of Energy Science Education Enhancement Act (42 U.S.C. 7381a) 

is amended by adding at the end:

 ``(c) Science Education Enhancement Fund.--The Secretary shall use 

not less than 0.3 percent of the amount made available to the Department 

for research, development, demonstration, and commercial application for 

fiscal year 2006 and each fiscal year thereafter to carry out activities 

authorized by this part.''.

 (b) Authorized Education Activities.--Section 3165 of the Department 

of Energy Science Education Enhancement Act (42 U.S.C. 7381b) is amended 

by adding at the end the following:

 ``(14) Support competitive events for students under the 

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 supervision of teachers, designed to encourage student interest 

 and knowledge in science and mathematics.

 ``(15) Support competitively-awarded, peer-reviewed programs 

 to promote professional development for mathematics teachers and 

 science teachers who teach in grades from kindergarten through 

 grade 12 at Department research and development facilities.

 ``(16) Support summer internships at Department research and 

 development facilities, for mathematics teachers and science 

 teachers who teach in grades from kindergarten through grade 12.

 ``(17) Sponsor and assist in educational and training 

 activities identified as critical skills needs for future 

 workforce development at Department research and development 

 facilities.''.

 (c) Educational Partnerships.--Section 3166(b) of the Department of 

Energy Science Education Enhancement Act (42 U.S.C. 7381c(b)) is 

amended--

 (1) by striking paragraph (1) and inserting the following:

 ``(1) loaning or transferring equipment to the 

 institution;'';

 (2) in paragraph (5), by striking ``and'' at the end;

 (3) in paragraph (6), by striking the period at the end and 

 inserting ``; and''; and

 (4) by adding at the end the following:

 ``(7) providing funds to educational institutions to hire 

 personnel to facilitate interactions between local school 

 systems, Department research and development facilities, and 

 corporate and governmental entities.''.

 (d) Definition of Department Research and Development Facilities.--

Section 3167(3) of the Department of Energy Science Education 

Enhancement Act (42 U.S.C. 7381d(3)) is amended by striking ``from the 

Office of Science of the Department of Energy'' and inserting ``by the 

Department of Energy''.

 (e) Study.--

 (1) In general.--The Secretary, in consultation with the 

 Secretary of Education, shall enter into an arrangement with the 

 National Academy of Public Administration to conduct a study of 

 the priorities, quality, local and regional flexibility, and 

 plans for educational programs at Department research and 

 development facilities.

 (2) Inclusion.--The study shall recommend measures that the 

 Secretary may take to improve Department-wide coordination of 

 educational, workforce development, and critical skills 

 development activities.

[[Page 119 STAT. 939]]

 (3) Report.--Not later than 2 years after the date of 

 enactment of this Act, the Secretary shall submit to Congress a 

 report on the results of the study conducted under this 

 subsection.

SEC. 1103. TRAINING <<NOTE: 42 USC 16412.>> GUIDELINES FOR NONNUCLEAR 

 ELECTRIC ENERGY INDUSTRY PERSONNEL.

 (a) In General.--The Secretary of Labor, in consultation with the 

Secretary and in conjunction with the electric industry and recognized 

employee representatives, shall develop model personnel training 

guidelines to support the reliability and safety of the nonnuclear 

electric system.

 (b) Requirements.--The training guidelines under subsection (a) 

shall, at a minimum--

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 (1) include training requirements for workers engaged in the 

 construction, operation, inspection, or maintenance of 

 nonnuclear electric generation, transmission, or distribution 

 systems, including requirements relating to--

 (A) competency;

 (B) certification; and

 (C) assessment, including--

 (i) initial and continuous evaluation of 

 workers;

 (ii) recertification procedures; and

 (iii) methods for examining or testing the 

 qualification of an individual who performs a 

 covered task; and

 (2) consolidate training guidelines in existence on the date 

 on which the guidelines under subsection (a) are developed 

 relating to the construction, operation, maintenance, and 

 inspection of nonnuclear electric generation, transmission, and 

 distribution facilities, such as guidelines established by the 

 National Electric Safety Code and other industry consensus 

 standards.

SEC. 1104. <<NOTE: 42 USC 16413.>> NATIONAL CENTER FOR ENERGY MANAGEMENT 

 AND BUILDING TECHNOLOGIES.

 The Secretary shall support the ongoing activities of and explore 

opportunities for expansion of the National Center for Energy Management 

and Building Technologies to carry out research, education, and training 

activities to facilitate the improvement of energy efficiency, indoor 

environmental quality, and security of industrial, commercial, 

residential, and public buildings.

SEC. 1105. IMPROVED ACCESS TO ENERGY-RELATED SCIENTIFIC AND TECHNICAL 

 CAREERS.

 (a) Science Education Programs.--Section 3164 of the Department of 

Energy Science Education Enhancement Act (42 U.S.C. 7381a) (as amended 

by section 1102(a)) is amended by adding at the end the following:

 ``(d) Programs for Students From Under-Represented Groups.--In 

carrying out a program under subsection (a), the Secretary shall give 

priority to activities that are designed to encourage students from 

under-represented groups to pursue scientific and technical careers.''.

 (b) Partnerships With Historically Black Colleges and Universities, 

Hispanic-Servicing Institutions, and Tribal Colleges.--The Department of 

Energy Science Education Enhancement Act (42 U.S.C. 7381 et seq.) is 

amended--

[[Page 119 STAT. 940]]

 (1) by redesignating sections 3167 and 3168 <<NOTE: 42 USC 

 7381d, 7381e.>> as sections 3168 and 3169, respectively; and

 (2) by inserting after section 3166 the following:

``SEC. 3167. <<NOTE: 42 USC 7381c-1.>> PARTNERSHIPS WITH HISTORICALLY 

 BLACK COLLEGES AND UNIVERSITIES, HISPANIC-SERVING 

 INSTITUTIONS, AND TRIBAL COLLEGES.

 ``(a) Definitions.--In this section:

 ``(1) Hispanic-serving institution.--The term `Hispanic-

 serving institution' has the meaning given the term in section 

 502(a) of the Higher Education Act of 1965 (20 U.S.C. 1101a(a)).

 ``(2) Historically black college or university.--The term 

 `historically Black college or university' has the meaning given 

 the term `part B institution' in section 322 of the Higher 

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 Education Act of 1965 (20 U.S.C. 1061).

 ``(3) National laboratory.--The term `National Laboratory' 

 has the meaning given the term in section 2 of the Energy Policy 

 Act of 2005.

 ``(4) Science facility.--The term `science facility' has the 

 meaning given the term `single-purpose research facility' in 

 section 903 of the Energy Policy Act of 2005.

 ``(5) Tribal college.--The term `tribal college' has the 

 meaning given the term `tribally controlled college or 

 university' in section 2(a) of the Tribally Controlled College 

 Assistance Act of 1978 (25 U.S.C. 1801(a)).

 ``(b) Education Partnership.--The Secretary shall require the 

director of each National Laboratory, and may require the head of any 

science facility, to increase the participation of historically Black 

colleges or universities, Hispanic-serving institutions, or tribal 

colleges in any activity that increases the capacity of the historically 

Black colleges or universities, Hispanic-serving institutions, or tribal 

colleges to train personnel in science or engineering.

 ``(c) Activities.--An activity described in subsection (b) 

includes--

 ``(1) collaborative research;

 ``(2) equipment transfer;

 ``(3) training activities carried out at a National 

 Laboratory or science facility; and

 ``(4) mentoring activities carried out at a National 

 Laboratory or science facility.

 ``(d) Report.--Not later than 2 years after the date of enactment of 

this subsection, the Secretary shall submit to Congress a report 

describing the activities carried out under this section.''.

SEC. 1106. <<NOTE: 42 USC 16414.>> NATIONAL POWER PLANT OPERATIONS 

 TECHNOLOGY AND EDUCATIONAL CENTER.

 (a) Establishment.--The Secretary shall support the establishment of 

a National Power Plant Operations Technology and Education Center 

(referred to in this section as the ``Center''), to address the need for 

training and educating certified operators and technicians for the 

electric power industry.

 (b) Location of Center.--The Secretary shall support the 

establishment of the Center at an institution of higher education that 

has--

 (1) expertise in providing degree programs in electric power 

 generation, transmission, and distribution technologies;

 (2) expertise in providing onsite and Internet-based 

 training; and

[[Page 119 STAT. 941]]

 (3) demonstrated responsiveness to workforce and training 

 requirements in the electric power industry.

 (c) Training and Continuing Education.--

 (1) In general.--The Center shall provide training and 

 continuing education in electric power generation, transmission, 

 and distribution technologies and operations.

 (2) Location.--The Center shall carry out training and 

 education activities under paragraph (1)--

 (A) at the Center; and

 (B) through Internet-based information technologies 

 that allow for learning at remote sites.

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TITLE <<NOTE: Electricity Modernization Act of 2005.>> XII--ELECTRICITY

SEC. 1201. <<NOTE: 42 USC 15801 note.>> SHORT TITLE.

 This title may be cited as the ``Electricity Modernization Act of 

2005''.

 Subtitle A--Reliability Standards

SEC. 1211. ELECTRIC RELIABILITY STANDARDS.

 (a) In General.--Part II of the Federal Power Act (16 U.S.C. 824 et 

seq.) is amended by adding at the end the following:

``SEC. 215. <<NOTE: 16 USC 824o.>> ELECTRIC RELIABILITY.

 ``(a) Definitions.--For purposes of this section:

 ``(1) The term `bulk-power system' means--

 ``(A) facilities and control systems necessary for 

 operating an interconnected electric energy transmission 

 network (or any portion thereof); and

 ``(B) electric energy from generation facilities 

 needed to maintain transmission system reliability.

 The term does not include facilities used in the local 

 distribution of electric energy.

 ``(2) The terms `Electric Reliability Organization' and 

 `ERO' mean the organization certified by the Commission under 

 subsection (c) the purpose of which is to establish and enforce 

 reliability standards for the bulk-power system, subject to 

 Commission review.

 ``(3) The term `reliability standard' means a requirement, 

 approved by the Commission under this section, to provide for 

 reliable operation of the bulk-power system. The term includes 

 requirements for the operation of existing bulk-power system 

 facilities, including cybersecurity protection, and the design 

 of planned additions or modifications to such facilities to the 

 extent necessary to provide for reliable operation of the bulk-

 power system, but the term does not include any requirement to 

 enlarge such facilities or to construct new transmission 

 capacity or generation capacity.

 ``(4) The term `reliable operation' means operating the 

 elements of the bulk-power system within equipment and electric 

 system thermal, voltage, and stability limits so that 

 instability, uncontrolled separation, or cascading failures of 

 such system will not occur as a result of a sudden disturbance, 

 including a cybersecurity incident, or unanticipated failure of 

 system elements.

[[Page 119 STAT. 942]]

 ``(5) The term `Interconnection' means a geographic area in 

 which the operation of bulk-power system components is 

 synchronized such that the failure of one or more of such 

 components may adversely affect the ability of the operators of 

 other components within the system to maintain reliable 

 operation of the facilities within their control.

 ``(6) The term `transmission organization' means a Regional 

 Transmission Organization, Independent System Operator, 

 independent transmission provider, or other transmission 

 organization finally approved by the Commission for the 

 operation of transmission facilities.

 ``(7) The term `regional entity' means an entity having 

 enforcement authority pursuant to subsection (e)(4).

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 ``(8) The term `cybersecurity incident' means a malicious 

 act or suspicious event that disrupts, or was an attempt to 

 disrupt, the operation of those programmable electronic devices 

 and communication networks including hardware, software and data 

 that are essential to the reliable operation of the bulk power 

 system.

 ``(b) Jurisdiction and Applicability.--(1) The Commission shall have 

jurisdiction, within the United States, over the ERO certified by the 

Commission under subsection (c), any regional entities, and all users, 

owners and operators of the bulk-power system, including but not limited 

to the entities described in section 201(f), for purposes of approving 

reliability standards established under this section and enforcing 

compliance with this section. All users, owners and operators of the 

bulk-power system shall comply with reliability standards that take 

effect under this section.

 ``(2) <<NOTE: Regulations. Deadline.>> The Commission shall issue a 

final rule to implement the requirements of this section not later than 

180 days after the date of enactment of this section.

 ``(c) Certification.--Following the issuance of a Commission rule 

under subsection (b)(2), any person may submit an application to the 

Commission for certification as the Electric Reliability Organization. 

The Commission may certify one such ERO if the Commission determines 

that such ERO--

 ``(1) has the ability to develop and enforce, subject to 

 subsection (e)(2), reliability standards that provide for an 

 adequate level of reliability of the bulk-power system; and

 ``(2) has established rules that--

 ``(A) assure its independence of the users and 

 owners and operators of the bulk-power system, while 

 assuring fair stakeholder representation in the 

 selection of its directors and balanced decisionmaking 

 in any ERO committee or subordinate organizational 

 structure;

 ``(B) allocate equitably reasonable dues, fees, and 

 other charges among end users for all activities under 

 this section;

 ``(C) provide fair and impartial procedures for 

 enforcement of reliability standards through the 

 imposition of penalties in accordance with subsection 

 (e) (including limitations on activities, functions, or 

 operations, or other appropriate sanctions);

 ``(D) provide for reasonable notice and opportunity 

 for public comment, due process, openness, and balance 

 of interests in developing reliability standards and 

 otherwise exercising its duties; and

[[Page 119 STAT. 943]]

 ``(E) provide for taking, after certification, 

 appropriate steps to gain recognition in Canada and 

 Mexico.

 ``(d) Reliability Standards.--(1) The Electric Reliability 

Organization shall file each reliability standard or modification to a 

reliability standard that it proposes to be made effective under this 

section with the Commission.

 ``(2) The Commission may approve, by rule or order, a proposed 

reliability standard or modification to a reliability standard if it 

determines that the standard is just, reasonable, not unduly 

discriminatory or preferential, and in the public interest. The 

Commission shall give due weight to the technical expertise of the 

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Electric Reliability Organization with respect to the content of a 

proposed standard or modification to a reliability standard and to the 

technical expertise of a regional entity organized on an 

Interconnection-wide basis with respect to a reliability standard to be 

applicable within that Interconnection, but shall not defer with respect 

to the effect of a standard on competition. A proposed standard or 

modification shall take effect upon approval by the Commission.

 ``(3) The Electric Reliability Organization shall rebuttably presume 

that a proposal from a regional entity organized on an Interconnectionwide basis for a reliability standard or modification to a reliability 

standard to be applicable on an Interconnection-wide basis is just, 

reasonable, and not unduly discriminatory or preferential, and in the 

public interest.

 ``(4) The Commission shall remand to the Electric Reliability 

Organization for further consideration a proposed reliability standard 

or a modification to a reliability standard that the Commission 

disapproves in whole or in part.

 ``(5) The Commission, upon its own motion or upon complaint, may 

order the Electric Reliability Organization to submit to the Commission 

a proposed reliability standard or a modification to a reliability 

standard that addresses a specific matter if the Commission considers 

such a new or modified reliability standard appropriate to carry out 

this section.

 ``(6) The final rule adopted under subsection (b)(2) shall include 

fair processes for the identification and timely resolution of any 

conflict between a reliability standard and any function, rule, order, 

tariff, rate schedule, or agreement accepted, approved, or ordered by 

the Commission applicable to a transmission organization. Such 

transmission organization shall continue to comply with such function, 

rule, order, tariff, rate schedule or agreement accepted, approved, or 

ordered by the Commission until--

 ``(A) the Commission finds a conflict exists between a 

 reliability standard and any such provision;

 ``(B) the Commission orders a change to such provision 

 pursuant to section 206 of this part; and

 ``(C) the ordered change becomes effective under this part.

If the Commission determines that a reliability standard needs to be 

changed as a result of such a conflict, it shall order the ERO to 

develop and file with the Commission a modified reliability standard 

under paragraph (4) or (5) of this subsection.

 ``(e) Enforcement.--(1) The ERO may impose, subject to paragraph 

(2), a penalty on a user or owner or operator of the bulk-power system 

for a violation of a reliability standard approved by the Commission 

under subsection (d) if the ERO, after notice and an opportunity for a 

hearing--

[[Page 119 STAT. 944]]

 ``(A) finds that the user or owner or operator has violated 

 a reliability standard approved by the Commission under 

 subsection (d); and

 ``(B) files notice and the record of the proceeding with the 

 Commission.

 ``(2) A penalty imposed under paragraph (1) may take effect not 

earlier than the 31st day after the ERO files with the Commission notice 

of the penalty and the record of proceedings. Such penalty shall be 

subject to review by the Commission, on its own motion or upon 

application by the user, owner or operator that is the subject of the 

penalty filed within 30 days after the date such notice is filed with 

the Commission. Application to the Commission for review, or the 

initiation of review by the Commission on its own motion, shall not 

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operate as a stay of such penalty unless the Commission otherwise orders 

upon its own motion or upon application by the user, owner or operator 

that is the subject of such penalty. In any proceeding to review a 

penalty imposed under paragraph (1), the Commission, after notice and 

opportunity for hearing (which hearing may consist solely of the record 

before the ERO and opportunity for the presentation of supporting 

reasons to affirm, modify, or set aside the penalty), shall by order 

affirm, set aside, reinstate, or modify the penalty, and, if 

appropriate, remand to the ERO for further proceedings. The Commission 

shall implement expedited procedures for such hearings.

 ``(3) On its own motion or upon complaint, the Commission may order 

compliance with a reliability standard and may impose a penalty against 

a user or owner or operator of the bulk-power system if the Commission 

finds, after notice and opportunity for a hearing, that the user or 

owner or operator of the bulk-power system has engaged or is about to 

engage in any acts or practices that constitute or will constitute a 

violation of a reliability standard.

 ``(4) <<NOTE: Regulations. Contracts.>> The Commission shall issue 

regulations authorizing the ERO to enter into an agreement to delegate 

authority to a regional entity for the purpose of proposing reliability 

standards to the ERO and enforcing reliability standards under paragraph 

(1) if--

 ``(A) the regional entity is governed by--

 ``(i) an independent board;

 ``(ii) a balanced stakeholder board; or

 ``(iii) a combination independent and balanced 

 stakeholder board.

 ``(B) the regional entity otherwise satisfies the provisions 

 of subsection (c)(1) and (2); and

 ``(C) the agreement promotes effective and efficient 

 administration of bulk-power system reliability.

The Commission may modify such delegation. The ERO and the Commission 

shall rebuttably presume that a proposal for delegation to a regional 

entity organized on an Interconnection-wide basis promotes effective and 

efficient administration of bulk-power system reliability and should be 

approved. Such regulation may provide that the Commission may assign the 

ERO's authority to enforce reliability standards under paragraph (1) 

directly to a regional entity consistent with the requirements of this 

paragraph.

 ``(5) The Commission may take such action as is necessary or 

appropriate against the ERO or a regional entity to ensure compliance 

with a reliability standard or any Commission order affecting the ERO or 

a regional entity.

[[Page 119 STAT. 945]]

 ``(6) Any penalty imposed under this section shall bear a reasonable 

relation to the seriousness of the violation and shall take into 

consideration the efforts of such user, owner, or operator to remedy the 

violation in a timely manner.

 ``(f) Changes in Electric Reliability Organization Rules.--The 

Electric Reliability Organization shall file with the Commission for 

approval any proposed rule or proposed rule change, accompanied by an 

explanation of its basis and purpose. The Commission, upon its own 

motion or complaint, may propose a change to the rules of the ERO. A 

proposed rule or proposed rule change shall take effect upon a finding 

by the Commission, after notice and opportunity for comment, that the 

change is just, reasonable, not unduly discriminatory or preferential, 

is in the public interest, and satisfies the requirements of subsection 

(c).

 ``(g) Reliability Reports.--The ERO shall conduct periodic 

assessments of the reliability and adequacy of the bulk-power system in 

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North America.

 ``(h) Coordination With Canada and Mexico.--The President is urged 

to negotiate international agreements with the governments of Canada and 

Mexico to provide for effective compliance with reliability standards 

and the effectiveness of the ERO in the United States and Canada or 

Mexico.

 ``(i) Savings Provisions.--(1) The ERO shall have authority to 

develop and enforce compliance with reliability standards for only the 

bulk-power system.

 ``(2) This section does not authorize the ERO or the Commission to 

order the construction of additional generation or transmission capacity 

or to set and enforce compliance with standards for adequacy or safety 

of electric facilities or services.

 ``(3) Nothing in this section shall be construed to preempt any 

authority of any State to take action to ensure the safety, adequacy, 

and reliability of electric service within that State, as long as such 

action is not inconsistent with any reliability standard, except that 

the State of New York may establish rules that result in greater 

reliability within that State, as long as such action does not result in 

lesser reliability outside the State than that provided by the 

reliability standards.

 ``(4) <<NOTE: Deadline. Standards.>> Within 90 days of the 

application of the Electric Reliability Organization or other affected 

party, and after notice and opportunity for comment, the Commission 

shall issue a final order determining whether a State action is 

inconsistent with a reliability standard, taking into consideration any 

recommendation of the ERO.

 ``(5) The Commission, after consultation with the ERO and the State 

taking action, may stay the effectiveness of any State action, pending 

the Commission's issuance of a final order.

 ``(j) <<NOTE: Establishment.>> Regional Advisory Bodies.--The 

Commission shall establish a regional advisory body on the petition of 

at least two-thirds of the States within a region that have more than 

one-half of their electric load served within the region. A regional 

advisory body shall be composed of one member from each participating 

State in the region, appointed by the Governor of each State, and may 

include representatives of agencies, States, and provinces outside the 

United States. A regional advisory body may provide advice to the 

Electric Reliability Organization, a regional entity, or the Commission 

regarding the governance of an existing or proposed regional entity 

within the same region, whether a standard

[[Page 119 STAT. 946]]

proposed to apply within the region is just, reasonable, not unduly 

discriminatory or preferential, and in the public interest, whether fees 

proposed to be assessed within the region are just, reasonable, not 

unduly discriminatory or preferential, and in the public interest and 

any other responsibilities requested by the Commission. The Commission 

may give deference to the advice of any such regional advisory body if 

that body is organized on an Interconnection-wide basis.

 ``(k) Alaska and Hawaii.--The provisions of this section do not 

apply to Alaska or Hawaii.''.

 (b) <<NOTE: 16 USC 824o note.>> Status of ERO.--The Electric 

Reliability Organization certified by the Federal Energy Regulatory 

Commission under section 215(c) of the Federal Power Act and any 

regional entity delegated enforcement authority pursuant to section 

215(e)(4) of that Act are not departments, agencies, or 

instrumentalities of the United States Government.

 (c) <<NOTE: 16 USC 824o note.>> Access Approvals by Federal 

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Agencies.--Federal agencies responsible for approving access to electric 

transmission or distribution facilities located on lands within the 

United States shall, in accordance with applicable law, expedite any 

Federal agency approvals that are necessary to allow the owners or 

operators of such facilities to comply with any reliability standard, 

approved by the Commission under section 215 of the Federal Power Act, 

that pertains to vegetation management, electric service restoration, or 

resolution of situations that imminently endanger the reliability or 

safety of the facilities.

 Subtitle B--Transmission Infrastructure Modernization

SEC. 1221. SITING OF INTERSTATE ELECTRIC TRANSMISSION FACILITIES.

 (a) In General.--Part II of the Federal Power Act (16 U.S.C. 824 et 

seq.) is amended by adding at the end the following:

``SEC. 216. <<NOTE: 16 USC 824p.>> SITING OF INTERSTATE ELECTRIC 

 TRANSMISSION FACILITIES.

 ``(a) <<NOTE: Deadlines.>> Designation of National Interest Electric 

Transmission Corridors.--(1) Not later than 1 year after the date of 

enactment of this section and every 3 years thereafter, the Secretary of 

Energy (referred to in this section as the `Secretary'), in consultation 

with affected States, shall conduct a study of electric transmission 

congestion.

 ``(2) <<NOTE: Reports.>> After considering alternatives and 

recommendations from interested parties (including an opportunity for 

comment from affected States), the Secretary shall issue a report, based 

on the study, which may designate any geographic area experiencing 

electric energy transmission capacity constraints or congestion that 

adversely affects consumers as a national interest electric transmission 

corridor.

 ``(3) The Secretary shall conduct the study and issue the report in 

consultation with any appropriate regional entity referred to in section 

215.

 ``(4) In determining whether to designate a national interest 

electric transmission corridor under paragraph (2), the Secretary may 

consider whether--

[[Page 119 STAT. 947]]

 ``(A) the economic vitality and development of the corridor, 

 or the end markets served by the corridor, may be constrained by 

 lack of adequate or reasonably priced electricity;

 ``(B)(i) economic growth in the corridor, or the end markets 

 served by the corridor, may be jeopardized by reliance on 

 limited sources of energy; and

 ``(ii) a diversification of supply is warranted;

 ``(C) the energy independence of the United States would be 

 served by the designation;

 ``(D) the designation would be in the interest of national 

 energy policy; and

 ``(E) the designation would enhance national defense and 

 homeland security.

 ``(b) Construction Permit.--Except as provided in subsection (i), 

the Commission may, after notice and an opportunity for hearing, issue 

one or more permits for the construction or modification of electric 

transmission facilities in a national interest electric transmission 

corridor designated by the Secretary under subsection (a) if the 

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Commission finds that--

 ``(1)(A) a State in which the transmission facilities are to 

 be constructed or modified does not have authority to--

 ``(i) approve the siting of the facilities; or

 ``(ii) consider the interstate benefits expected to 

 be achieved by the proposed construction or modification 

 of transmission facilities in the State;

 ``(B) the applicant for a permit is a transmitting utility 

 under this Act but does not qualify to apply for a permit or 

 siting approval for the proposed project in a State because the 

 applicant does not serve end-use customers in the State; or

 ``(C) a State commission or other entity that has authority 

 to approve the siting of the facilities has--

 ``(i) withheld approval for more than 1 year after 

 the filing of an application seeking approval pursuant 

 to applicable law or 1 year after the designation of the 

 relevant national interest electric transmission 

 corridor, whichever is later; or

 ``(ii) conditioned its approval in such a manner 

 that the proposed construction or modification will not 

 significantly reduce transmission congestion in 

 interstate commerce or is not economically feasible;

 ``(2) the facilities to be authorized by the permit will be 

 used for the transmission of electric energy in interstate 

 commerce;

 ``(3) the proposed construction or modification is 

 consistent with the public interest;

 ``(4) the proposed construction or modification will 

 significantly reduce transmission congestion in interstate 

 commerce and protects or benefits consumers;

 ``(5) the proposed construction or modification is 

 consistent with sound national energy policy and will enhance 

 energy independence; and

 ``(6) the proposed modification will maximize, to the extent 

 reasonable and economical, the transmission capabilities of 

 existing towers or structures.

 ``(c) Permit Applications.--(1) Permit applications under subsection 

(b) shall be made in writing to the Commission.

[[Page 119 STAT. 948]]

 ``(2) <<NOTE: Regulations.>> The Commission shall issue rules 

specifying--

 ``(A) the form of the application;

 ``(B) the information to be contained in the application; 

 and

 ``(C) the manner of service of notice of the permit 

 application on interested persons.

 ``(d) Comments.--In any proceeding before the Commission under 

subsection (b), the Commission shall afford each State in which a 

transmission facility covered by the permit is or will be located, each 

affected Federal agency and Indian tribe, private property owners, and 

other interested persons, a reasonable opportunity to present their 

views and recommendations with respect to the need for and impact of a 

facility covered by the permit.

 ``(e) Rights-of-Way.--(1) In the case of a permit under subsection 

(b) for electric transmission facilities to be located on property other 

than property owned by the United States or a State, if the permit 

holder cannot acquire by contract, or is unable to agree with the owner 

of the property to the compensation to be paid for, the necessary rightof-way to construct or modify the transmission facilities, the permit 

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holder may acquire the right-of-way by the exercise of the right of 

eminent domain in the district court of the United States for the 

district in which the property concerned is located, or in the 

appropriate court of the State in which the property is located.

 ``(2) Any right-of-way acquired under paragraph (1) shall be used 

exclusively for the construction or modification of electric 

transmission facilities within a reasonable period of time after the 

acquisition.

 ``(3) The practice and procedure in any action or proceeding under 

this subsection in the district court of the United States shall conform 

as nearly as practicable to the practice and procedure in a similar 

action or proceeding in the courts of the State in which the property is 

located.

 ``(4) Nothing in this subsection shall be construed to authorize the 

use of eminent domain to acquire a right-of-way for any purpose other 

than the construction, modification, operation, or maintenance of 

electric transmission facilities and related facilities. The right-ofway cannot be used for any other purpose, and the right-of-way shall 

terminate upon the termination of the use for which the right-of-way was 

acquired.

 ``(f) Compensation.--(1) Any right-of-way acquired pursuant to 

subsection (e) shall be considered a taking of private property for 

which just compensation is due.

 ``(2) Just compensation shall be an amount equal to the fair market 

value (including applicable severance damages) of the property taken on 

the date of the exercise of eminent domain authority.

 ``(g) State Law.--Nothing in this section precludes any person from 

constructing or modifying any transmission facility in accordance with 

State law.

 ``(h) Coordination of Federal Authorizations for Transmission 

Facilities.--(1) In this subsection:

 ``(A) The term `Federal authorization' means any 

 authorization required under Federal law in order to site a 

 transmission facility.

 ``(B) The term `Federal authorization' includes such 

 permits, special use authorizations, certifications, opinions, 

 or other

[[Page 119 STAT. 949]]

 approvals as may be required under Federal law in order to site 

 a transmission facility.

 ``(2) The Department of Energy shall act as the lead agency for 

purposes of coordinating all applicable Federal authorizations and 

related environmental reviews of the facility.

 ``(3) To the maximum extent practicable under applicable Federal 

law, the Secretary shall coordinate the Federal authorization and review 

process under this subsection with any Indian tribes, multistate 

entities, and State agencies that are responsible for conducting any 

separate permitting and environmental reviews of the facility, to ensure 

timely and efficient review and permit decisions.

 ``(4)(A) As head of the lead agency, the Secretary, in consultation 

with agencies responsible for Federal authorizations and, as 

appropriate, with Indian tribes, multistate entities, and State agencies 

that are willing to coordinate their own separate permitting and 

environmental reviews with the Federal authorization and environmental 

reviews, shall establish prompt and binding intermediate milestones and 

ultimate deadlines for the review of, and Federal authorization 

decisions relating to, the proposed facility.

 ``(B) <<NOTE: Deadline.>> The Secretary shall ensure that, once an 

application has been submitted with such data as the Secretary considers 

necessary, all permit decisions and related environmental reviews under 

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all applicable Federal laws shall be completed--

 ``(i) within 1 year; or

 ``(ii) if a requirement of another provision of Federal law 

 does not permit compliance with clause (i), as soon thereafter 

 as is practicable.

 ``(C) <<NOTE: Deadline.>> The Secretary shall provide an expeditious 

pre-application mechanism for prospective applicants to confer with the 

agencies involved to have each such agency determine and communicate to 

the prospective applicant not later than 60 days after the prospective 

applicant submits a request for such information concerning--

 ``(i) the likelihood of approval for a potential facility; 

 and

 ``(ii) key issues of concern to the agencies and public.

 ``(5)(A) As lead agency head, the Secretary, in consultation with 

the affected agencies, shall prepare a single environmental review 

document, which shall be used as the basis for all decisions on the 

proposed project under Federal law.

 ``(B) The Secretary and the heads of other agencies shall streamline 

the review and permitting of transmission within corridors designated 

under section 503 of the Federal Land Policy and Management Act (43 

U.S.C. 1763) by fully taking into account prior analyses and decisions 

relating to the corridors.

 ``(C) The document shall include consideration by the relevant 

agencies of any applicable criteria or other matters as required under 

applicable law.

 ``(6)(A) If any agency has denied a Federal authorization required 

for a transmission facility, or has failed to act by the deadline 

established by the Secretary pursuant to this section for deciding 

whether to issue the authorization, the applicant or any State in which 

the facility would be located may file an appeal with the President, who 

shall, in consultation with the affected agency, review the denial or 

failure to take action on the pending application.

 ``(B) Based on the overall record and in consultation with the 

affected agency, the President may--

[[Page 119 STAT. 950]]

 ``(i) issue the necessary authorization with any appropriate 

 conditions; or

 ``(ii) deny the application.

 ``(C) <<NOTE: President. Deadline.>> The President shall issue a 

decision not later than 90 days after the date of the filing of the 

appeal.

 ``(D) <<NOTE: President.>> In making a decision under this 

paragraph, the President shall comply with applicable requirements of 

Federal law, including any requirements of--

 ``(i) the National Forest Management Act of 1976 (16 U.S.C. 

 472a et seq.);

 ``(ii) the Endangered Species Act of 1973 (16 U.S.C. 1531 et 

 seq.);

 ``(iii) the Federal Water Pollution Control Act (33 U.S.C. 

 1251 et seq.);

 ``(iv) the National Environmental Policy Act of 1969 (42 

 U.S.C. 4321 et seq.); and

 ``(v) the Federal Land Policy and Management Act of 1976 (43 

 U.S.C. 1701 et seq.).

 ``(7)(A) <<NOTE: Deadline. Regulations.>> Not later than 18 months 

after the date of enactment of this section, the Secretary shall issue 

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any regulations necessary to implement this subsection.

 ``(B)(i) <<NOTE: Deadline. Memorandum.>> Not later than 1 year after 

the date of enactment of this section, the Secretary and the heads of 

all Federal agencies with authority to issue Federal authorizations 

shall enter into a memorandum of understanding to ensure the timely and 

coordinated review and permitting of electricity transmission 

facilities.

 ``(ii) Interested Indian tribes, multistate entities, and State 

agencies may enter the memorandum of understanding.

 ``(C) The head of each Federal agency with authority to issue a 

Federal authorization shall designate a senior official responsible for, 

and dedicate sufficient other staff and resources to ensure, full 

implementation of the regulations and memorandum required under this 

paragraph.

 ``(8)(A) Each Federal land use authorization for an electricity 

transmission facility shall be issued--

 ``(i) for a duration, as determined by the Secretary, 

 commensurate with the anticipated use of the facility; and

 ``(ii) with appropriate authority to manage the right-of-way 

 for reliability and environmental protection.

 ``(B) On the expiration of the authorization (including an 

authorization issued before the date of enactment of this section), the 

authorization shall be reviewed for renewal taking fully into account 

reliance on such electricity infrastructure, recognizing the importance 

of the authorization for public health, safety, and economic welfare and 

as a legitimate use of Federal land.

 ``(9) In exercising the responsibilities under this section, the 

Secretary shall consult regularly with--

 ``(A) the Federal Energy Regulatory Commission;

 ``(B) electric reliability organizations (including related 

 regional entities) approved by the Commission; and

 ``(C) Transmission Organizations approved by the Commission.

 ``(i) Interstate Compacts.--(1) The consent of Congress is given for 

three or more contiguous States to enter into an interstate compact, 

subject to approval by Congress, establishing regional transmission 

siting agencies to--

[[Page 119 STAT. 951]]

 ``(A) facilitate siting of future electric energy 

 transmission facilities within those States; and

 ``(B) carry out the electric energy transmission siting 

 responsibilities of those States.

 ``(2) The Secretary may provide technical assistance to regional 

transmission siting agencies established under this subsection.

 ``(3) The regional transmission siting agencies shall have the 

authority to review, certify, and permit siting of transmission 

facilities, including facilities in national interest electric 

transmission corridors (other than facilities on property owned by the 

United States).

 ``(4) The Commission shall have no authority to issue a permit for 

the construction or modification of an electric transmission facility 

within a State that is a party to a compact, unless the members of the 

compact are in disagreement and the Secretary makes, after notice and an 

opportunity for a hearing, the finding described in subsection 

(b)(1)(C).

 ``(j) Relationship to Other Laws.--(1) Except as specifically 

provided, nothing in this section affects any requirement of an 

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environmental law of the United States, including the National 

Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.).

 ``(2) Subsection (h)(6) shall not apply to any unit of the National 

Park System, the National Wildlife Refuge System, the National Wild and 

Scenic Rivers System, the National Trails System, the National 

Wilderness Preservation System, or a National Monument.

 ``(k) ERCOT.--This section shall not apply within the area referred 

to in section 212(k)(2)(A).''.

 (b) Reports to Congress on Corridors and Rights-of-Way on Federal 

Lands.--Not later than 90 days after the date of enactment of this Act, 

the Secretary of the Interior, the Secretary, the Secretary of 

Agriculture, and the Chairman of the Council on Environmental Quality 

shall submit to Congress a joint report identifying--

 (1)(A) all existing designated transmission and distribution 

 corridors on Federal land and the status of work related to 

 proposed transmission and distribution corridor designations 

 under title V of the Federal Land Policy and Management Act of 

 1976 (43 U.S.C. 1761 et seq.);

 (B) the schedule for completing the work;

 (C) any impediments to completing the work; and

 (D) steps that Congress could take to expedite the process;

 (2)(A) the number of pending applications to locate 

 transmission facilities on Federal land;

 (B) key information relating to each such facility;

 (C) how long each application has been pending;

 (D) the schedule for issuing a timely decision as to each 

 facility; and

 (E) progress in incorporating existing and new such rights-

 of-way into relevant land use and resource management plans or 

 the equivalent of those plans; and

 (3)(A) the number of existing transmission and distribution 

 rights-of-way on Federal land that will come up for renewal 

 within the following 5-, 10-, and 15-year periods; and

 (B) a description of how the Secretaries plan to manage the 

 renewals.

[[Page 119 STAT. 952]]

SEC. 1222. <<NOTE: 42 USC 16421.>> THIRD-PARTY FINANCE.

 (a) Existing Facilities.--The Secretary, acting through the 

Administrator of the Western Area Power Administration (hereinafter in 

this section referred to as ``WAPA''), or through the Administrator of 

the Southwestern Power Administration (hereinafter in this section 

referred to as ``SWPA''), or both, may design, develop, construct, 

operate, maintain, or own, or participate with other entities in 

designing, developing, constructing, operating, maintaining, or owning, 

an electric power transmission facility and related facilities 

(``Project'') needed to upgrade existing transmission facilities owned 

by SWPA or WAPA if the Secretary, in consultation with the applicable 

Administrator, determines that the proposed Project--

 (1)(A) is located in a national interest electric 

 transmission corridor designated under section 216(a) of the 

 Federal Power Act and will reduce congestion of electric 

 transmission in interstate commerce; or

 (B) is necessary to accommodate an actual or projected 

 increase in demand for electric transmission capacity;

 (2) is consistent with--

 (A) transmission needs identified, in a transmission 

 expansion plan or otherwise, by the appropriate 

 Transmission Organization (as defined in the Federal 

 Power Act), if any, or approved regional reliability 

 organization; and

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 (B) efficient and reliable operation of the 

 transmission grid; and

 (3) would be operated in conformance with prudent utility 

 practice.

 (b) New Facilities.--The Secretary, acting through WAPA or SWPA, or 

both, may design, develop, construct, operate, maintain, or own, or 

participate with other entities in designing, developing, constructing, 

operating, maintaining, or owning, a new electric power transmission 

facility and related facilities (``Project'') located within any State 

in which WAPA or SWPA operates if the Secretary, in consultation with 

the applicable Administrator, determines that the proposed Project--

 (1)(A) is located in an area designated under section 216(a) 

 of the Federal Power Act and will reduce congestion of electric 

 transmission in interstate commerce; or

 (B) is necessary to accommodate an actual or projected 

 increase in demand for electric transmission capacity;

 (2) is consistent with--

 (A) transmission needs identified, in a transmission 

 expansion plan or otherwise, by the appropriate 

 Transmission Organization (as defined in the Federal 

 Power Act) if any, or approved regional reliability 

 organization; and

 (B) efficient and reliable operation of the 

 transmission grid;

 (3) will be operated in conformance with prudent utility 

 practice;

 (4) will be operated by, or in conformance with the rules 

 of, the appropriate (A) Transmission Organization, if any, or 

 (B) if such an organization does not exist, regional reliability 

 organization; and

[[Page 119 STAT. 953]]

 (5) will not duplicate the functions of existing 

 transmission facilities or proposed facilities which are the 

 subject of ongoing or approved siting and related permitting 

 proceedings.

 (c) Other Funds.--

 (1) In general.--In carrying out a Project under subsection 

 (a) or (b), the Secretary may accept and use funds contributed 

 by another entity for the purpose of carrying out the Project.

 (2) Availability.--The contributed funds shall be available 

 for expenditure for the purpose of carrying out the Project--

 (A) without fiscal year limitation; and

 (B) as if the funds had been appropriated 

 specifically for that Project.

 (3) Allocation of costs.--In carrying out a Project under 

 subsection (a) or (b), any costs of the Project not paid for by 

 contributions from another entity shall be collected through 

 rates charged to customers using the new transmission capability 

 provided by the Project and allocated equitably among these 

 project beneficiaries using the new transmission capability.

 (d) Relationship to Other Laws.--Nothing in this section affects any 

requirement of--

 (1) any Federal environmental law, including the National 

 Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.);

 (2) any Federal or State law relating to the siting of 

 energy facilities; or

 (3) any existing authorizing statutes.

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 (e) Savings Clause.--Nothing in this section shall constrain or 

restrict an Administrator in the utilization of other authority 

delegated to the Administrator of WAPA or SWPA.

 (f) Secretarial Determinations.--Any determination made pursuant to 

subsections (a) or (b) shall be based on findings by the Secretary using 

the best available data.

 (g) Maximum Funding Amount.--The Secretary shall not accept and use 

more than $100,000,000 under subsection (c)(1) for the period 

encompassing fiscal years 2006 through 2015.

SEC. 1223. <<NOTE: 42 USC 16422.>> ADVANCED TRANSMISSION TECHNOLOGIES.

 (a) Definition of Advanced Transmission Technology.--In this 

section, the term ``advanced transmission technology'' means a 

technology that increases the capacity, efficiency, or reliability of an 

existing or new transmission facility, including--

 (1) high-temperature lines (including superconducting 

 cables);

 (2) underground cables;

 (3) advanced conductor technology (including advanced 

 composite conductors, high-temperature low-sag conductors, and 

 fiber optic temperature sensing conductors);

 (4) high-capacity ceramic electric wire, connectors, and 

 insulators;

 (5) optimized transmission line configurations (including 

 multiple phased transmission lines);

 (6) modular equipment;

 (7) wireless power transmission;

 (8) ultra-high voltage lines;

 (9) high-voltage DC technology;

 (10) flexible AC transmission systems;

[[Page 119 STAT. 954]]

 (11) energy storage devices (including pumped hydro, 

 compressed air, superconducting magnetic energy storage, 

 flywheels, and batteries);

 (12) controllable load;

 (13) distributed generation (including PV, fuel cells, and 

 microturbines);

 (14) enhanced power device monitoring;

 (15) direct system state sensors;

 (16) fiber optic technologies;

 (17) power electronics and related software (including real 

 time monitoring and analytical software);

 (18) mobile transformers and mobile substations; and

 (19) any other technologies the Commission considers 

 appropriate.

 (b) Authority.--In carrying out the Federal Power Act (16 U.S.C. 

791a et seq.) and the Public Utility Regulatory Policies Act of 1978 (16 

U.S.C. 2601 et seq.), the Commission shall encourage, as appropriate, 

the deployment of advanced transmission technologies.

SEC. 1224. <<NOTE: 42 USC 16423.>> ADVANCED POWER SYSTEM TECHNOLOGY 

 INCENTIVE PROGRAM.

 (a) Program.--The Secretary is authorized to establish an Advanced 

Power System Technology Incentive Program to support the deployment of 

certain advanced power system technologies and to improve and protect 

certain critical governmental, industrial, and commercial processes. 

Funds provided under this section shall be used by the Secretary to make 

incentive payments to eligible owners or operators of advanced power 

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system technologies to increase power generation through enhanced 

operational, economic, and environmental performance. Payments under 

this section may only be made upon receipt by the Secretary of an 

incentive payment application establishing an applicant as either--

 (1) a qualifying advanced power system technology facility; 

 or

 (2) a qualifying security and assured power facility.

 (b) Incentives.--Subject to availability of funds, a payment of 1.8 

cents per kilowatt-hour shall be paid to the owner or operator of a 

qualifying advanced power system technology facility under this section 

for electricity generated at such facility. An additional 0.7 cents per 

kilowatt-hour shall be paid to the owner or operator of a qualifying 

security and assured power facility for electricity generated at such 

facility. Any facility qualifying under this section shall be eligible 

for an incentive payment for up to, but not more than, the first 

10,000,000 kilowatt-hours produced in any fiscal year.

 (c) Eligibility.--For purposes of this section:

 (1) Qualifying advanced power system technology facility.--

 The term ``qualifying advanced power system technology 

 facility'' means a facility using an advanced fuel cell, 

 turbine, or hybrid power system or power storage system to 

 generate or store electric energy.

 (2) Qualifying security and assured power facility.--The 

 term ``qualifying security and assured power facility'' means a 

 qualifying advanced power system technology facility determined 

 by the Secretary, in consultation with the Secretary of Homeland 

 Security, to be in critical need of secure, reliable,

[[Page 119 STAT. 955]]

 rapidly available, high-quality power for critical governmental, 

 industrial, or commercial applications.

 (d) Authorization.--There are authorized to be appropriated to the 

Secretary for the purposes of this section, $10,000,000 for each of the 

fiscal years 2006 through 2012.

 Subtitle C--Transmission Operation Improvements

SEC. 1231. OPEN NONDISCRIMINATORY ACCESS.

 Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is amended 

by inserting after section 211 (16 U.S.C. 824j) the following:

``SEC. 211A. <<NOTE: 16 USC 824j-1.>> OPEN ACCESS BY UNREGULATED 

 TRANSMITTING UTILITIES.

 ``(a) Definition of Unregulated Transmitting Utility.--In this 

section, the term `unregulated transmitting utility' means an entity 

that--

 ``(1) owns or operates facilities used for the transmission 

 of electric energy in interstate commerce; and

 ``(2) is an entity described in section 201(f).

 ``(b) Transmission Operation Services.--Subject to section 212(h), 

the Commission may, by rule or order, require an unregulated 

transmitting utility to provide transmission services--

 ``(1) at rates that are comparable to those that the 

 unregulated transmitting utility charges itself; and

 ``(2) on terms and conditions (not relating to rates) that 

 are comparable to those under which the unregulated transmitting 

 utility provides transmission services to itself and that are 

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 not unduly discriminatory or preferential.

 ``(c) Exemption.--The Commission shall exempt from any rule or order 

under this section any unregulated transmitting utility that--

 ``(1) sells not more than 4,000,000 megawatt hours of 

 electricity per year;

 ``(2) does not own or operate any transmission facilities 

 that are necessary for operating an interconnected transmission 

 system (or any portion of the system); or

 ``(3) meets other criteria the Commission determines to be 

 in the public interest.

 ``(d) Local Distribution Facilities.--The requirements of subsection 

(b) shall not apply to facilities used in local distribution.

 ``(e) Exemption Termination.--If the Commission, after an 

evidentiary hearing held on a complaint and after giving consideration 

to reliability standards established under section 215, finds on the 

basis of a preponderance of the evidence that any exemption granted 

pursuant to subsection (c) unreasonably impairs the continued 

reliability of an interconnected transmission system, the Commission 

shall revoke the exemption granted to the transmitting utility.

 ``(f) Application to Unregulated Transmitting Utilities.--The rate 

changing procedures applicable to public utilities under subsections (c) 

and (d) of section 205 are applicable to unregulated transmitting 

utilities for purposes of this section.

[[Page 119 STAT. 956]]

 ``(g) Remand.--In exercising authority under subsection (b)(1), the 

Commission may remand transmission rates to an unregulated transmitting 

utility for review and revision if necessary to meet the requirements of 

subsection (b).

 ``(h) Other Requests.--The provision of transmission services under 

subsection (b) does not preclude a request for transmission services 

under section 211.

 ``(i) Limitation.--The Commission may not require a State or 

municipality to take action under this section that would violate a 

private activity bond rule for purposes of section 141 of the Internal 

Revenue Code of 1986.

 ``(j) Transfer of Control of Transmitting Facilities.--Nothing in 

this section authorizes the Commission to require an unregulated 

transmitting utility to transfer control or operational control of its 

transmitting facilities to a Transmission Organization that is 

designated to provide nondiscriminatory transmission access.''.

SEC. 1232. <<NOTE: 42 USC 16431.>> FEDERAL UTILITY PARTICIPATION IN 

 TRANSMISSION ORGANIZATIONS.

 (a) Definitions.--In this section:

 (1) Appropriate federal regulatory authority.--The term 

 ``appropriate Federal regulatory authority'' means--

 (A) in the case of a Federal power marketing agency, 

 the Secretary, except that the Secretary may designate 

 the Administrator of a Federal power marketing agency to 

 act as the appropriate Federal regulatory authority with 

 respect to the transmission system of the Federal power 

 marketing agency; and

 (B) in the case of the Tennessee Valley Authority, 

 the Board of Directors of the Tennessee Valley 

 Authority.

 (2) Federal power marketing agency.--The term ``Federal 

 power marketing agency'' has the meaning given the term in 

 section 3 of the Federal Power Act (16 U.S.C. 796).

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 (3) Federal utility.--The term ``Federal utility'' means--

 (A) a Federal power marketing agency; or

 (B) the Tennessee Valley Authority.

 (4) Transmission organization.--The term ``Transmission 

 Organization'' has the meaning given the term in section 3 of 

 the Federal Power Act (16 U.S.C. 796).

 (5) Transmission system.--The term ``transmission system'' 

 means an electric transmission facility owned, leased, or 

 contracted for by the United States and operated by a Federal 

 utility.

 (b) Transfer.--The appropriate Federal regulatory authority may 

enter into a contract, agreement, or other arrangement transferring 

control and use of all or part of the transmission system of a Federal 

utility to a Transmission Organization.

 (c) Contents.--The contract, agreement, or arrangement shall 

include--

 (1) performance standards for operation and use of the 

 transmission system that the head of the Federal utility 

 determines are necessary or appropriate, including standards 

 that ensure--

 (A) recovery of all of the costs and expenses of the 

 Federal utility related to the transmission facilities 

 that

[[Page 119 STAT. 957]]

 are the subject of the contract, agreement, or other 

 arrangement;

 (B) consistency with existing contracts and third-

 party financing arrangements; and

 (C) consistency with the statutory authorities, 

 obligations, and limitations of the Federal utility;

 (2) provisions for monitoring and oversight by the Federal 

 utility of the Transmission Organization's terms and conditions 

 of the contract, agreement, or other arrangement, including a 

 provision for the resolution of disputes through arbitration or 

 other means with the Transmission Organization or with other 

 participants, notwithstanding the obligations and limitations of 

 any other law regarding arbitration; and

 (3) a provision that allows the Federal utility to withdraw 

 from the Transmission Organization and terminate the contract, 

 agreement, or other arrangement in accordance with its terms.

 (d) Commission.--Neither this section, actions taken pursuant to 

this section, nor any other transaction of a Federal utility 

participating in a Transmission Organization shall confer on the 

Commission jurisdiction or authority over--

 (1) the electric generation assets, electric capacity, or 

 energy of the Federal utility that the Federal utility is 

 authorized by law to market; or

 (2) the power sales activities of the Federal utility.

 (e) Existing Statutory and Other Obligations.--

 (1) System operation requirements.--No statutory provision 

 requiring or authorizing a Federal utility to transmit electric 

 power or to construct, operate, or maintain the transmission 

 system of the Federal utility prohibits a transfer of control 

 and use of the transmission system pursuant to, and subject to, 

 the requirements of this section.

 (2) Other obligations.--This subsection does not--

 (A) suspend, or exempt any Federal utility from, any 

 provision of Federal law in effect on the date of 

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 enactment of this Act, including any requirement or 

 direction relating to the use of the transmission system 

 of the Federal utility, environmental protection, fish 

 and wildlife protection, flood control, navigation, 

 water delivery, or recreation; or

 (B) authorize abrogation of any contract or treaty 

 obligation.

 (3) Conforming amendment.--Section 311 of the Energy and 

 Water Development Appropriations Act, 2001 (16 U.S.C. 824n) is 

 repealed.

SEC. 1233. NATIVE LOAD SERVICE OBLIGATION.

 (a) In General.--Part II of the Federal Power Act (16 U.S.C. 824 et 

seq.) is amended by adding at the end the following:

``SEC. 217. <<NOTE: 16 USC 824q.>> NATIVE LOAD SERVICE OBLIGATION.

 ``(a) Definitions.--In this section:

 ``(1) The term `distribution utility' means an electric 

 utility that has a service obligation to end-users or to a State 

 utility or electric cooperative that, directly or indirectly, 

 through one or more additional State utilities or electric 

 cooperatives, provides electric service to end-users.

 ``(2) The term `load-serving entity' means a distribution 

 utility or an electric utility that has a service obligation.

[[Page 119 STAT. 958]]

 ``(3) The term `service obligation' means a requirement 

 applicable to, or the exercise of authority granted to, an 

 electric utility under Federal, State, or local law or under 

 long-term contracts to provide electric service to end-users or 

 to a distribution utility.

 ``(4) The term `State utility' means a State or any 

 political subdivision of a State, or any agency, authority, or 

 instrumentality of any one or more of the foregoing, or a 

 corporation that is wholly owned, directly or indirectly, by any 

 one or more of the foregoing, competent to carry on the business 

 of developing, transmitting, utilizing, or distributing power.

 ``(b) <<NOTE: Applicability.>> Meeting Service Obligations.--(1) 

Paragraph (2) applies to any load-serving entity that, as of the date of 

enactment of this section--

 ``(A) owns generation facilities, markets the output of 

 Federal generation facilities, or holds rights under one or more 

 wholesale contracts to purchase electric energy, for the purpose 

 of meeting a service obligation; and

 ``(B) by reason of ownership of transmission facilities, or 

 one or more contracts or service agreements for firm 

 transmission service, holds firm transmission rights for 

 delivery of the output of the generation facilities or the 

 purchased energy to meet the service obligation.

 ``(2) Any load-serving entity described in paragraph (1) is entitled 

to use the firm transmission rights, or, equivalent tradable or 

financial transmission rights, in order to deliver the output or 

purchased energy, or the output of other generating facilities or 

purchased energy to the extent deliverable using the rights, to the 

extent required to meet the service obligation of the load-serving 

entity.

 ``(3)(A) To the extent that all or a portion of the service 

obligation covered by the firm transmission rights or equivalent 

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tradable or financial transmission rights is transferred to another 

load-serving entity, the successor load-serving entity shall be entitled 

to use the firm transmission rights or equivalent tradable or financial 

transmission rights associated with the transferred service obligation.

 ``(B) Subsequent transfers to another load-serving entity, or back 

to the original load-serving entity, shall be entitled to the same 

rights.

 ``(4) The Commission shall exercise the authority of the Commission 

under this Act in a manner that facilitates the planning and expansion 

of transmission facilities to meet the reasonable needs of load-serving 

entities to satisfy the service obligations of the load-serving 

entities, and enables load-serving entities to secure firm transmission 

rights (or equivalent tradable or financial rights) on a long-term basis 

for long-term power supply arrangements made, or planned, to meet such 

needs.

 ``(c) Allocation of Transmission Rights.--Nothing in subsections 

(b)(1), (b)(2), and (b)(3) of this section shall affect any existing or 

future methodology employed by a Transmission Organization for 

allocating or auctioning transmission rights if such Transmission 

Organization was authorized by the Commission to allocate or auction 

financial transmission rights on its system as of January 1, 2005, and 

the Commission determines that any future allocation or auction is just, 

reasonable and not unduly discriminatory or preferential, provided, 

however, that if such a Transmission

[[Page 119 STAT. 959]]

Organization never allocated financial transmission rights on its system 

that pertained to a period before January 1, 2005, with respect to any 

application by such Transmission Organization that would change its 

methodology the Commission shall exercise its authority in a manner 

consistent with the Act and that takes into account the policies 

expressed in subsections (b)(1), (b)(2), and (b)(3) as applied to firm 

transmission rights held by a load-serving entity as of January 1, 2005, 

to the extent the associated generation ownership or power purchase 

arrangements remain in effect.

 ``(d) Certain Transmission Rights.--The Commission may exercise 

authority under this Act to make transmission rights not used to meet an 

obligation covered by subsection (b) available to other entities in a 

manner determined by the Commission to be just, reasonable, and not 

unduly discriminatory or preferential.

 ``(e) Obligation to Build.--Nothing in this Act relieves a loadserving entity from any obligation under State or local law to build 

transmission or distribution facilities adequate to meet the service 

obligations of the load-serving entity.

 ``(f) Contracts.--Nothing in this section shall provide a basis for 

abrogating any contract or service agreement for firm transmission 

service or rights in effect as of the date of the enactment of this 

subsection. If an ISO in the Western Interconnection had allocated 

financial transmission rights prior to the date of enactment of this 

section but had not done so with respect to one or more load-serving 

entities' firm transmission rights held under contracts to which the 

preceding sentence applies (or held by reason of ownership or future 

ownership of transmission facilities), such load-serving entities may 

not be required, without their consent, to convert such firm 

transmission rights to tradable or financial rights, except where the 

load-serving entity has voluntarily joined the ISO as a participating 

transmission owner (or its successor) in accordance with the ISO tariff.

 ``(g) Water Pumping Facilities.--The Commission shall ensure that 

any entity described in section 201(f) that owns transmission facilities 

used predominately to support its own water pumping facilities shall 

have, with respect to the facilities, protections for transmission 

service comparable to those provided to load-serving entities pursuant 

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to this section.

 ``(h) ERCOT.--This section shall not apply within the area referred 

to in section 212(k)(2)(A).

 ``(i) Jurisdiction.--This section does not authorize the Commission 

to take any action not otherwise within the jurisdiction of the 

Commission.

 ``(j) TVA Area.--(1) Subject to paragraphs (2) and (3), for purposes 

of subsection (b)(1)(B), a load-serving entity that is located within 

the service area of the Tennessee Valley Authority and that has a firm 

wholesale power supply contract with the Tennessee Valley Authority 

shall be considered to hold firm transmission rights for the 

transmission of the power provided.

 ``(2) Nothing in this subsection affects the requirements of section 

212(j).

 ``(3) The Commission shall not issue an order on the basis of this 

subsection that is contrary to the purposes of section 212(j).

 ``(k) Effect of Exercising Rights.--An entity that to the extent 

required to meet its service obligations exercises rights

[[Page 119 STAT. 960]]

described in subsection (b) shall not be considered by such action as 

engaging in undue discrimination or preference under this Act.''.

 (b) <<NOTE: Deadline. 16 USC 824q note.>> FERC Rulemaking on LongTerm Transmission Rights in Organized Markets.--Within 1 year after the 

date of enactment of this section and after notice and an opportunity 

for comment, the Commission shall by rule or order, implement section 

217(b)(4) of the Federal Power Act in Transmission Organizations, as 

defined by that Act with organized electricity markets.

SEC. 1234. <<NOTE: 42 USC 16432.>> STUDY ON THE BENEFITS OF ECONOMIC 

 DISPATCH.

 (a) Study.--The Secretary, in coordination and consultation with the 

States, shall conduct a study on--

 (1) the procedures currently used by electric utilities to 

 perform economic dispatch;

 (2) identifying possible revisions to those procedures to 

 improve the ability of nonutility generation resources to offer 

 their output for sale for the purpose of inclusion in economic 

 dispatch; and

 (3) the potential benefits to residential, commercial, and 

 industrial electricity consumers nationally and in each State if 

 economic dispatch procedures were revised to improve the ability 

 of nonutility generation resources to offer their output for 

 inclusion in economic dispatch.

 (b) Definition.--The term ``economic dispatch'' when used in this 

section means the operation of generation facilities to produce energy 

at the lowest cost to reliably serve consumers, recognizing any 

operational limits of generation and transmission facilities.

 (c) Report to Congress and the States.--Not later than 90 days after 

the date of enactment of this Act, and on a yearly basis following, the 

Secretary shall submit a report to Congress and the States on the 

results of the study conducted under subsection (a), including 

recommendations to Congress and the States for any suggested legislative 

or regulatory changes.

SEC. 1235. PROTECTION OF TRANSMISSION CONTRACTS IN THE PACIFIC 

 NORTHWEST.

 Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is amended 

by adding at the end the following:

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``SEC. 218. <<NOTE: 16 USC 824r.>> PROTECTION OF TRANSMISSION CONTRACTS 

 IN THE PACIFIC NORTHWEST.

 ``(a) Definition of Electric Utility or Person.--In this section, 

the term `electric utility or person' means an electric utility or 

person that--

 ``(1) as of the date of enactment of the Energy Policy Act 

 of 2005 holds firm transmission rights pursuant to contract or 

 by reason of ownership of transmission facilities; and

 ``(2) is located--

 ``(A) in the Pacific Northwest, as that region is 

 defined in section 3 of the Pacific Northwest Electric 

 Power Planning and Conservation Act (16 U.S.C. 839a); or

 ``(B) in that portion of a State included in the 

 geographic area proposed for a regional transmission 

 organization in Commission Docket Number RT01-35 on the 

 date on which that docket was opened.

 ``(b) Protection of Transmission Contracts.--Nothing in this Act 

confers on the Commission the authority to require an electric utility 

or person to convert to tradable or financial rights--

[[Page 119 STAT. 961]]

 ``(1) firm transmission rights described in subsection (a); 

 or

 ``(2) firm transmission rights obtained by exercising 

 contract or tariff rights associated with the firm transmission 

 rights described in subsection (a).''.

SEC. 1236. SENSE OF CONGRESS REGARDING LOCATIONAL INSTALLED CAPACITY 

 MECHANISM.

 (a) Findings.--Congress finds that--

 (1) in regard to a proposal to develop and implement a 

 specific type of locational installed capacity mechanism in New 

 England pending before the Federal Energy Regulatory Commission; 

 and

 (2) the Governors of the States have objected to the 

 proposed mechanism, arguing that the mechanism--

 (A) would not provide adequate assurance that 

 necessary electric generation capacity or reliability 

 will be provided; and

 (B) would impose a high cost on consumers and have a 

 significant negative economic impact.

 (b) Sense of Congress.--Congress--

 (1) notes the concerns of the New England States to the 

 proposed mechanism; and

 (2) declares that it is the sense of Congress that the 

 Federal Energy Regulatory Commission should carefully consider 

 the States' objections.

 Subtitle D--Transmission Rate Reform

SEC. 1241. TRANSMISSION INFRASTRUCTURE INVESTMENT.

 Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is amended 

by adding at the end the following:

``SEC. 219. <<NOTE: 16 USC 824s.>> TRANSMISSION INFRASTRUCTURE 

 INVESTMENT.

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 ``(a) <<NOTE: Deadline.>> Rulemaking Requirement.--Not later than 1 

year after the date of enactment of this section, the Commission shall 

establish, by rule, incentive-based (including performance-based) rate 

treatments for the transmission of electric energy in interstate 

commerce by public utilities for the purpose of benefitting consumers by 

ensuring reliability and reducing the cost of delivered power by 

reducing transmission congestion.

 ``(b) Contents.--The rule shall--

 ``(1) promote reliable and economically efficient 

 transmission and generation of electricity by promoting capital 

 investment in the enlargement, improvement, maintenance, and 

 operation of all facilities for the transmission of electric 

 energy in interstate commerce, regardless of the ownership of 

 the facilities;

 ``(2) provide a return on equity that attracts new 

 investment in transmission facilities (including related 

 transmission technologies);

 ``(3) encourage deployment of transmission technologies and 

 other measures to increase the capacity and efficiency of 

 existing transmission facilities and improve the operation of 

 the facilities; and

 ``(4) allow recovery of--

[[Page 119 STAT. 962]]

 ``(A) all prudently incurred costs necessary to 

 comply with mandatory reliability standards issued 

 pursuant to section 215; and

 ``(B) all prudently incurred costs related to 

 transmission infrastructure development pursuant to 

 section 216.

 ``(c) Incentives.--In the rule issued under this section, the 

Commission shall, to the extent within its jurisdiction, provide for 

incentives to each transmitting utility or electric utility that joins a 

Transmission Organization. The Commission shall ensure that any costs 

recoverable pursuant to this subsection may be recovered by such utility 

through the transmission rates charged by such utility or through the 

transmission rates charged by the Transmission Organization that 

provides transmission service to such utility.

 ``(d) Just and Reasonable Rates.--All rates approved under the rules 

adopted pursuant to this section, including any revisions to the rules, 

are subject to the requirements of sections 205 and 206 that all rates, 

charges, terms, and conditions be just and reasonable and not unduly 

discriminatory or preferential.''.

SEC. 1242. <<NOTE: 42 USC 16441.>> FUNDING NEW INTERCONNECTION AND 

 TRANSMISSION UPGRADES.

 The Commission may approve a participant funding plan that allocates 

costs related to transmission upgrades or new generator interconnection, 

without regard to whether an applicant is a member of a Commissionapproved Transmission Organization, if the plan results in rates that--

 (1) are just and reasonable;

 (2) are not unduly discriminatory or preferential; and

 (3) are otherwise consistent with sections 205 and 206 of 

 the Federal Power Act (16 U.S.C. 824d, 824e).

 Subtitle E--Amendments to PURPA

SEC. 1251. NET METERING AND ADDITIONAL STANDARDS.

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 (a) Adoption of Standards.--Section 111(d) of the Public Utility 

Regulatory Policies Act of 1978 (16 U.S.C. 2621(d)) is amended by adding 

at the end the following:

 ``(11) Net metering.--Each electric utility shall make 

 available upon request net metering service to any electric 

 consumer that the electric utility serves. For purposes of this 

 paragraph, the term `net metering service' means service to an 

 electric consumer under which electric energy generated by that 

 electric consumer from an eligible on-site generating facility 

 and delivered to the local distribution facilities may be used 

 to offset electric energy provided by the electric utility to 

 the electric consumer during the applicable billing period.

 ``(12) Fuel sources.--Each electric utility shall develop a 

 plan to minimize dependence on 1 fuel source and to ensure that 

 the electric energy it sells to consumers is generated using a 

 diverse range of fuels and technologies, including renewable 

 technologies.

 ``(13) Fossil fuel generation efficiency.--Each electric 

 utility shall develop and implement a 10-year plan to increase 

 the efficiency of its fossil fuel generation.''.

[[Page 119 STAT. 963]]

 (b) Compliance.--

 (1) <<NOTE: Deadlines.>> Time limitations.--Section 112(b) 

 of the Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 

 2622(b)) is amended by adding at the end the following:

 ``(3)(A) Not later than 2 years after the enactment of this 

paragraph, each State regulatory authority (with respect to each 

electric utility for which it has ratemaking authority) and each 

nonregulated electric utility shall commence the consideration referred 

to in section 111, or set a hearing date for such consideration, with 

respect to each standard established by paragraphs (11) through (13) of 

section 111(d).

 ``(B) Not later than 3 years after the date of the enactment of this 

paragraph, each State regulatory authority (with respect to each 

electric utility for which it has ratemaking authority), and each 

nonregulated electric utility, shall complete the consideration, and 

shall make the determination, referred to in section 111 with respect to 

each standard established by paragraphs (11) through (13) of section 

111(d).''.

 (2) Failure to comply.--Section 112(c) of the Public Utility 

 Regulatory Policies Act of 1978 (16 U.S.C. 2622(c)) is amended 

 by adding at the end the following: ``In the case of each 

 standard established by paragraphs (11) through (13) of section 

 111(d), the reference contained in this subsection to the date 

 of enactment of this Act shall be deemed to be a reference to 

 the date of enactment of such paragraphs (11) through (13).''.

 (3) Prior state actions.--

 (A) In general.--Section 112 of the Public Utility 

 Regulatory Policies Act of 1978 (16 U.S.C. 2622) is 

 amended by adding at the end the following:

 ``(d) Prior State Actions.--Subsections (b) and (c) of this section 

shall not apply to the standards established by paragraphs (11) through 

(13) of section 111(d) in the case of any electric utility in a State 

if, before the enactment of this subsection--

 ``(1) the State has implemented for such utility the 

 standard concerned (or a comparable standard);

 ``(2) the State regulatory authority for such State or 

 relevant nonregulated electric utility has conducted a 

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 proceeding to consider implementation of the standard concerned 

 (or a comparable standard) for such utility; or

 ``(3) the State legislature has voted on the implementation 

 of such standard (or a comparable standard) for such utility.''.

 (B) Cross reference.--Section 124 of such Act (16 

 U.S.C. 2634) is amended by adding the following at the 

 end thereof: ``In the case of each standard established 

 by paragraphs (11) through (13) of section 111(d), the 

 reference contained in this subsection to the date of 

 enactment of this Act shall be deemed to be a reference 

 to the date of enactment of such paragraphs (11) through 

 (13).''.

SEC. 1252. SMART METERING.

 (a) In General.--Section 111(d) of the Public Utility Regulatory 

Policies Act of 1978 (16 U.S.C. 2621(d)) is amended by adding at the end 

the following:

 ``(14) <<NOTE: Deadline.>> Time-based metering and 

 communications.--(A) Not later than 18 months after the date of 

 enactment of this paragraph, each electric utility shall offer 

 each of its customer

[[Page 119 STAT. 964]]

 classes, and provide individual customers upon customer request, 

 a time-based rate schedule under which the rate charged by the 

 electric utility varies during different time periods and 

 reflects the variance, if any, in the utility's costs of 

 generating and purchasing electricity at the wholesale level. 

 The time-based rate schedule shall enable the electric consumer 

 to manage energy use and cost through advanced metering and 

 communications technology.

 ``(B) The types of time-based rate schedules that may be 

 offered under the schedule referred to in subparagraph (A) 

 include, among others--

 ``(i) time-of-use pricing whereby electricity prices 

 are set for a specific time period on an advance or 

 forward basis, typically not changing more often than 

 twice a year, based on the utility's cost of generating 

 and/or purchasing such electricity at the wholesale 

 level for the benefit of the consumer. Prices paid for 

 energy consumed during these periods shall be pre-

 established and known to consumers in advance of such 

 consumption, allowing them to vary their demand and 

 usage in response to such prices and manage their energy 

 costs by shifting usage to a lower cost period or 

 reducing their consumption overall;

 ``(ii) critical peak pricing whereby time-of-use 

 prices are in effect except for certain peak days, when 

 prices may reflect the costs of generating and/or 

 purchasing electricity at the wholesale level and when 

 consumers may receive additional discounts for reducing 

 peak period energy consumption;

 ``(iii) real-time pricing whereby electricity prices 

 are set for a specific time period on an advanced or 

 forward basis, reflecting the utility's cost of 

 generating and/or purchasing electricity at the 

 wholesale level, and may change as often as hourly; and

 ``(iv) credits for consumers with large loads who 

 enter into pre-established peak load reduction 

 agreements that reduce a utility's planned capacity 

 obligations.

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 ``(C) Each electric utility subject to subparagraph (A) 

 shall provide each customer requesting a time-based rate with a 

 time-based meter capable of enabling the utility and customer to 

 offer and receive such rate, respectively.

 ``(D) For purposes of implementing this paragraph, any 

 reference contained in this section to the date of enactment of 

 the Public Utility Regulatory Policies Act of 1978 shall be 

 deemed to be a reference to the date of enactment of this 

 paragraph.

 ``(E) In a State that permits third-party marketers to sell 

 electric energy to retail electric consumers, such consumers 

 shall be entitled to receive the same time-based metering and 

 communications device and service as a retail electric consumer 

 of the electric utility.

 ``(F) <<NOTE: Deadline.>> Notwithstanding subsections (b) 

 and (c) of section 112, each State regulatory authority shall, 

 not later than 18 months after the date of enactment of this 

 paragraph conduct an investigation in accordance with section 

 115(i) and issue a decision whether it is appropriate to 

 implement the standards set out in subparagraphs (A) and (C).''.

[[Page 119 STAT. 965]]

 (b) State Investigation of Demand Response and Time-Based 

Metering.--Section 115 of the Public Utility Regulatory Policies Act of 

1978 (16 U.S.C. 2625) is amended as follows:

 (1) By inserting in subsection (b) after the phrase ``the 

 standard for time-of-day rates established by section 

 111(d)(3)'' the following: ``and the standard for time-based 

 metering and communications established by section 111(d)(14)''.

 (2) By inserting in subsection (b) after the phrase ``are 

 likely to exceed the metering'' the following: ``and 

 communications''.

 (3) By adding at the end the following:

 ``(i) Time-Based Metering and Communications.--In making a 

determination with respect to the standard established by section 

111(d)(14), the investigation requirement of section 111(d)(14)(F) shall 

be as follows: Each State regulatory authority shall conduct an 

investigation and issue a decision whether or not it is appropriate for 

electric utilities to provide and install time-based meters and 

communications devices for each of their customers which enable such 

customers to participate in time-based pricing rate schedules and other 

demand response programs.''.

 (c) Federal Assistance on Demand Response.--Section 132(a) of the 

Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2642(a)) is 

amended by striking ``and'' at the end of paragraph (3), striking the 

period at the end of paragraph (4) and inserting ``; and'', and by 

adding the following at the end thereof:

 ``(5) technologies, techniques, and rate-making methods 

 related to advanced metering and communications and the use of 

 these technologies, techniques and methods in demand response 

 programs.''.

 (d) Federal Guidance.--Section 132 of the Public Utility Regulatory 

Policies Act of 1978 (16 U.S.C. 2642) is amended by adding the following 

at the end thereof:

 ``(d) Demand Response.--The Secretary shall be responsible for--

 ``(1) educating consumers on the availability, advantages, 

 and benefits of advanced metering and communications 

 technologies, including the funding of demonstration or pilot 

 projects;

 ``(2) working with States, utilities, other energy providers 

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 and advanced metering and communications experts to identify and 

 address barriers to the adoption of demand response programs; 

 and

 ``(3) <<NOTE: Deadline. Reports.>> not later than 180 days 

 after the date of enactment of the Energy Policy Act of 2005, 

 providing Congress with a report that identifies and quantifies 

 the national benefits of demand response and makes a 

 recommendation on achieving specific levels of such benefits by 

 January 1, 2007.''.

 (e) <<NOTE: 16 USC 2642 note.>> Demand Response and Regional 

Coordination.--

 (1) In general.--It is the policy of the United States to 

 encourage States to coordinate, on a regional basis, State 

 energy policies to provide reliable and affordable demand 

 response services to the public.

 (2) Technical assistance.--The Secretary shall provide 

 technical assistance to States and regional organizations formed 

 by two or more States to assist them in--

 (A) identifying the areas with the greatest demand 

 response potential;

[[Page 119 STAT. 966]]

 (B) identifying and resolving problems in 

 transmission and distribution networks, including 

 through the use of demand response;

 (C) developing plans and programs to use demand 

 response to respond to peak demand or emergency needs; 

 and

 (D) identifying specific measures consumers can take 

 to participate in these demand response programs.

 (3) Report.--Not later than 1 year after the date of 

 enactment of the Energy Policy Act of 2005, the Commission shall 

 prepare and publish an annual report, by appropriate region, 

 that assesses demand response resources, including those 

 available from all consumer classes, and which identifies and 

 reviews--

 (A) saturation and penetration rate of advanced 

 meters and communications technologies, devices and 

 systems;

 (B) existing demand response programs and time-based 

 rate programs;

 (C) the annual resource contribution of demand 

 resources;

 (D) the potential for demand response as a 

 quantifiable, reliable resource for regional planning 

 purposes;

 (E) steps taken to ensure that, in regional 

 transmission planning and operations, demand resources 

 are provided equitable treatment as a quantifiable, 

 reliable resource relative to the resource obligations 

 of any load-serving entity, transmission provider, or 

 transmitting party; and

 (F) regulatory barriers to improve customer 

 participation in demand response, peak reduction and 

 critical period pricing programs.

 (f) Federal Encouragement of Demand Response Devices.--It is the 

policy of the United States that time-based pricing and other forms of 

demand response, whereby electricity customers are provided with 

electricity price signals and the ability to benefit by responding to 

them, shall be encouraged, the deployment of such technology and devices 

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that enable electricity customers to participate in such pricing and 

demand response systems shall be facilitated, and unnecessary barriers 

to demand response participation in energy, capacity and ancillary 

service markets shall be eliminated. It is further the policy of the 

United States that the benefits of such demand response that accrue to 

those not deploying such technology and devices, but who are part of the 

same regional electricity entity, shall be recognized.

 (g) <<NOTE: Deadlines.>> Time Limitations.--Section 112(b) of the 

Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2622(b)) is 

amended by adding at the end the following:

 ``(4)(A) Not later than 1 year after the enactment of this 

 paragraph, each State regulatory authority (with respect to each 

 electric utility for which it has ratemaking authority) and each 

 nonregulated electric utility shall commence the consideration 

 referred to in section 111, or set a hearing date for such 

 consideration, with respect to the standard established by 

 paragraph (14) of section 111(d).

 ``(B) Not later than 2 years after the date of the enactment 

 of this paragraph, each State regulatory authority (with respect 

 to each electric utility for which it has ratemaking authority),

[[Page 119 STAT. 967]]

 and each nonregulated electric utility, shall complete the 

 consideration, and shall make the determination, referred to in 

 section 111 with respect to the standard established by 

 paragraph (14) of section 111(d).''.

 (h) Failure to Comply.--Section 112(c) of the Public Utility 

Regulatory Policies Act of 1978 (16 U.S.C. 2622(c)) is amended by adding 

at the end the following:

 ``In the case of the standard established by paragraph (14) of 

section 111(d), the reference contained in this subsection to the date 

of enactment of this Act shall be deemed to be a reference to the date 

of enactment of such paragraph (14).''.

 (i) Prior State Actions Regarding Smart Metering Standards.--

 (1) In general.--Section 112 of the Public Utility 

 Regulatory Policies Act of 1978 (16 U.S.C. 2622) is amended by 

 adding at the end the following:

 ``(e) Prior State Actions.--Subsections (b) and (c) of this section 

shall not apply to the standard established by paragraph (14) of section 

111(d) in the case of any electric utility in a State if, before the 

enactment of this subsection--

 ``(1) the State has implemented for such utility the 

 standard concerned (or a comparable standard);

 ``(2) the State regulatory authority for such State or 

 relevant nonregulated electric utility has conducted a 

 proceeding to consider implementation of the standard concerned 

 (or a comparable standard) for such utility within the previous 

 3 years; or

 ``(3) the State legislature has voted on the implementation 

 of such standard (or a comparable standard) for such utility 

 within the previous 3 years.''.

 (2) Cross reference.--Section 124 of such Act (16 U.S.C. 

 2634) is amended by adding the following at the end thereof: 

 ``In the case of the standard established by paragraph (14) of 

 section 111(d), the reference contained in this subsection to 

 the date of enactment of this Act shall be deemed to be a 

 reference to the date of enactment of such paragraph (14).''.

SEC. 1253. COGENERATION AND SMALL POWER PRODUCTION PURCHASE AND SALE 

 REQUIREMENTS.

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 (a) Termination of Mandatory Purchase and Sale Requirements.--

Section 210 of the Public Utility Regulatory Policies Act of 1978 (16 

U.S.C. 824a-3) is amended by adding at the end the following:

 ``(m) Termination of Mandatory Purchase and Sale Requirements.--

 ``(1) Obligation to purchase.--After the date of enactment 

 of this subsection, no electric utility shall be required to 

 enter into a new contract or obligation to purchase electric 

 energy from a qualifying cogeneration facility or a qualifying 

 small power production facility under this section if the 

 Commission finds that the qualifying cogeneration facility or 

 qualifying small power production facility has nondiscriminatory 

 access to--

 ``(A)(i) independently administered, auction-based 

 day ahead and real time wholesale markets for the sale 

 of electric energy; and (ii) wholesale markets for long-

 term sales of capacity and electric energy; or

[[Page 119 STAT. 968]]

 ``(B)(i) transmission and interconnection services 

 that are provided by a Commission-approved regional 

 transmission entity and administered pursuant to an open 

 access transmission tariff that affords 

 nondiscriminatory treatment to all customers; and (ii) 

 competitive wholesale markets that provide a meaningful 

 opportunity to sell capacity, including long-term and 

 short-term sales, and electric energy, including long-

 term, short-term and real-time sales, to buyers other 

 than the utility to which the qualifying facility is 

 interconnected. In determining whether a meaningful 

 opportunity to sell exists, the Commission shall 

 consider, among other factors, evidence of transactions 

 within the relevant market; or

 ``(C) wholesale markets for the sale of capacity and 

 electric energy that are, at a minimum, of comparable 

 competitive quality as markets described in 

 subparagraphs (A) and (B).

 ``(2) Revised purchase and sale obligation for new 

 facilities.--(A) After the date of enactment of this subsection, 

 no electric utility shall be required pursuant to this section 

 to enter into a new contract or obligation to purchase from or 

 sell electric energy to a facility that is not an existing 

 qualifying cogeneration facility unless the facility meets the 

 criteria for qualifying cogeneration facilities established by 

 the Commission pursuant to the rulemaking required by subsection 

 (n).

 ``(B) For the purposes of this paragraph, the term `existing 

 qualifying cogeneration facility' means a facility that--

 ``(i) was a qualifying cogeneration facility on the 

 date of enactment of subsection (m); or

 ``(ii) had filed with the Commission a notice of 

 self-certification, self recertification or an 

 application for Commission certification under 18 CFR 

 292.207 prior to the date on which the Commission issues 

 the final rule required by subsection (n).

 ``(3) Commission review.--Any electric utility may file an 

 application with the Commission for relief from the mandatory 

 purchase obligation pursuant to this subsection on a service 

 territory-wide basis. Such application shall set forth the 

 factual basis upon which relief is requested and describe why 

 the conditions set forth in subparagraph (A), (B), or (C) of 

 paragraph (1) of this subsection have been 

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 met. <<NOTE: Notice. Deadline.>> After notice, including 

 sufficient notice to potentially affected qualifying 

 cogeneration facilities and qualifying small power production 

 facilities, and an opportunity for comment, the Commission shall 

 make a final determination within 90 days of such application 

 regarding whether the conditions set forth in subparagraph (A), 

 (B), or (C) of paragraph (1) have been met.

 ``(4) Reinstatement of obligation to purchase.--At any time 

 after the Commission makes a finding under paragraph (3) 

 relieving an electric utility of its obligation to purchase 

 electric energy, a qualifying cogeneration facility, a 

 qualifying small power production facility, a State agency, or 

 any other affected person may apply to the Commission for an 

 order reinstating the electric utility's obligation to purchase 

 electric energy under this section. Such application shall set 

 forth the factual basis upon which the application is based and 

 describe

[[Page 119 STAT. 969]]

 why the conditions set forth in subparagraph (A), (B), or (C) of 

 paragraph (1) of this subsection are no longer 

 met. <<NOTE: Notice. Deadline.>> After notice, including 

 sufficient notice to potentially affected utilities, and 

 opportunity for comment, the Commission shall issue an order 

 within 90 days of such application reinstating the electric 

 utility's obligation to purchase electric energy under this 

 section if the Commission finds that the conditions set forth in 

 subparagraphs (A), (B) or (C) of paragraph (1) which relieved 

 the obligation to purchase, are no longer met.

 ``(5) Obligation to sell.--After the date of enactment of 

 this subsection, no electric utility shall be required to enter 

 into a new contract or obligation to sell electric energy to a 

 qualifying cogeneration facility or a qualifying small power 

 production facility under this section if the Commission finds 

 that--

 ``(A) competing retail electric suppliers are 

 willing and able to sell and deliver electric energy to 

 the qualifying cogeneration facility or qualifying small 

 power production facility; and

 ``(B) the electric utility is not required by State 

 law to sell electric energy in its service territory.

 ``(6) No effect on existing rights and remedies.--Nothing in 

 this subsection affects the rights or remedies of any party 

 under any contract or obligation, in effect or pending approval 

 before the appropriate State regulatory authority or non-

 regulated electric utility on the date of enactment of this 

 subsection, to purchase electric energy or capacity from or to 

 sell electric energy or capacity to a qualifying cogeneration 

 facility or qualifying small power production facility under 

 this Act (including the right to recover costs of purchasing 

 electric energy or capacity).

 ``(7) Recovery of costs.--(A) The Commission shall issue and 

 enforce such regulations as are necessary to ensure that an 

 electric utility that purchases electric energy or capacity from 

 a qualifying cogeneration facility or qualifying small power 

 production facility in accordance with any legally enforceable 

 obligation entered into or imposed under this section recovers 

 all prudently incurred costs associated with the purchase.

 ``(B) A regulation under subparagraph (A) shall be 

 enforceable in accordance with the provisions of law applicable 

 to enforcement of regulations under the Federal Power Act (16 

 U.S.C. 791a et seq.).

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 ``(n) <<NOTE: Deadline.>> Rulemaking for New Qualifying 

Facilities.--(1)(A) Not later than 180 days after the date of enactment 

of this section, the Commission shall issue a rule revising the criteria 

in 18 CFR 292.205 for new qualifying cogeneration facilities seeking to 

sell electric energy pursuant to section 210 of this Act to ensure--

 ``(i) that the thermal energy output of a new qualifying 

 cogeneration facility is used in a productive and beneficial 

 manner;

 ``(ii) the electrical, thermal, and chemical output of the 

 cogeneration facility is used fundamentally for industrial, 

 commercial, or institutional purposes and is not intended 

 fundamentally for sale to an electric utility, taking into 

 account technological, efficiency, economic, and variable 

 thermal energy requirements, as well as State laws applicable to 

 sales of electric energy from a qualifying facility to its host 

 facility; and

[[Page 119 STAT. 970]]

 ``(iii) continuing progress in the development of efficient 

 electric energy generating technology.

 ``(B) <<NOTE: Applicability.>> The rule issued pursuant to paragraph 

(1)(A) of this subsection shall be applicable only to facilities that 

seek to sell electric energy pursuant to section 210 of this Act. For 

all other purposes, except as specifically provided in subsection 

(m)(2)(A), qualifying facility status shall be determined in accordance 

with the rules and regulations of this Act.

 ``(2) <<NOTE: Applicability.>> Notwithstanding rule revisions under 

paragraph (1), the Commission's criteria for qualifying cogeneration 

facilities in effect prior to the date on which the Commission issues 

the final rule required by paragraph (1) shall continue to apply to any 

cogeneration facility that--

 ``(A) was a qualifying cogeneration facility on the date of 

 enactment of subsection (m), or

 ``(B) had filed with the Commission a notice of self-

 certification, self-recertification or an application for 

 Commission certification under 18 CFR 292.207 prior to the date 

 on which the Commission issues the final rule required by 

 paragraph (1).''.

 (b) Elimination of Ownership Limitations.--

 (1) Qualifying small power production facility.--Section 

 3(17)(C) of the Federal Power Act (16 U.S.C. 796(17)(C)) is 

 amended to read as follows:

 ``(C) `qualifying small power production facility' 

 means a small power production facility that the 

 Commission determines, by rule, meets such requirements 

 (including requirements respecting fuel use, fuel 

 efficiency, and reliability) as the Commission may, by 

 rule, prescribe;''.

 (2) Qualifying cogeneration facility.--Section 3(18)(B) of 

 the Federal Power Act (16 U.S.C. 796(18)(B)) is amended to read 

 as follows:

 ``(B) `qualifying cogeneration facility' means a 

 cogeneration facility that the Commission determines, by 

 rule, meets such requirements (including requirements 

 respecting minimum size, fuel use, and fuel efficiency) 

 as the Commission may, by rule, prescribe;''.

SEC. 1254. INTERCONNECTION.

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 (a) Adoption of Standards.--Section 111(d) of the Public Utility 

Regulatory Policies Act of 1978 (16 U.S.C. 2621(d)) is amended by adding 

at the end the following:

 ``(15) Interconnection.--Each electric utility shall make 

 available, upon request, interconnection service to any electric 

 consumer that the electric utility serves. For purposes of this 

 paragraph, the term `interconnection service' means service to 

 an electric consumer under which an on-site generating facility 

 on the consumer's premises shall be connected to the local 

 distribution facilities. Interconnection services shall be 

 offered based upon the standards developed by the Institute of 

 Electrical and Electronics Engineers: IEEE Standard 1547 for 

 Interconnecting Distributed Resources with Electric Power 

 Systems, as they may be amended from time to time. In addition, 

 agreements and procedures shall be established whereby the 

 services are offered shall promote current best practices of 

 interconnection for distributed generation, including but not 

 limited to practices stipulated in model codes adopted by

[[Page 119 STAT. 971]]

 associations of state regulatory agencies. All such agreements 

 and procedures shall be just and reasonable, and not unduly 

 discriminatory or preferential.''.

 (b) Compliance.--

 (1) <<NOTE: Deadlines.>> Time limitations.--Section 112(b) 

 of the Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 

 2622(b)) is amended by adding at the end the following:

 ``(5)(A) Not later than 1 year after the enactment of this 

 paragraph, each State regulatory authority (with respect to each 

 electric utility for which it has ratemaking authority) and each 

 nonregulated utility shall commence the consideration referred 

 to in section 111, or set a hearing date for consideration, with 

 respect to the standard established by paragraph (15) of section 

 111(d).

 ``(B) Not later than two years after the date of the 

 enactment of the this paragraph, each State regulatory authority 

 (with respect to each electric utility for which it has 

 ratemaking authority), and each nonregulated electric utility, 

 shall complete the consideration, and shall make the 

 determination, referred to in section 111 with respect to each 

 standard established by paragraph (15) of section 111(d).''.

 (2) Failure to comply.--Section 112(d) of the Public Utility 

 Regulatory Policies Act of 1978 (16 U.S.C. 2622(c)) is amended 

 by adding at the end the following: ``In the case of the 

 standard established by paragraph (15), the reference contained 

 in this subsection to the date of enactment of this Act shall be 

 deemed to be a reference to the date of enactment of paragraph 

 (15).''.

 (3) Prior state actions.--

 (A) In general.--Section 112 of the Public Utility 

 Regulatory Policies Act of 1978 (16 U.S.C. 2622) is 

 amended by adding at the end the following:

 ``(f) Prior State Actions.--Subsections (b) and (c) of this section 

shall not apply to the standard established by paragraph (15) of section 

111(d) in the case of any electric utility in a State if, before the 

enactment of this subsection--

 ``(1) the State has implemented for such utility the 

 standard concerned (or a comparable standard);

 ``(2) the State regulatory authority for such State or 

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 relevant nonregulated electric utility has conducted a 

 proceeding to consider implementation of the standard concerned 

 (or a comparable standard) for such utility; or

 ``(3) the State legislature has voted on the implementation 

 of such standard (or a comparable standard) for such utility.''.

 (B) Cross reference.--Section 124 of such Act (16 

 U.S.C. 2634) is amended by adding the following at the 

 end thereof: ``In the case of each standard established 

 by paragraph (15) of section 111(d), the reference 

 contained in this subsection to the date of enactment of 

 the Act shall be deemed to be a reference to the date of 

 enactment of paragraph (15).''.

[[Page 119 STAT. 972]]

Subtitle <<NOTE: Public Utility Holding Company Act of 2005.>> F--Repeal 

of PUHCA

SEC. 1261. <<NOTE: 42 USC 15801 note.>> SHORT TITLE.

 This subtitle may be cited as the ``Public Utility Holding Company 

Act of 2005''.

SEC. 1262. <<NOTE: 42 USC 16451.>> DEFINITIONS.

 For purposes of this subtitle:

 (1) Affiliate.--The term ``affiliate'' of a company means 

 any company, 5 percent or more of the outstanding voting 

 securities of which are owned, controlled, or held with power to 

 vote, directly or indirectly, by such company.

 (2) Associate company.--The term ``associate company'' of a 

 company means any company in the same holding company system 

 with such company.

 (3) Commission.--The term ``Commission'' means the Federal 

 Energy Regulatory Commission.

 (4) Company.--The term ``company'' means a corporation, 

 partnership, association, joint stock company, business trust, 

 or any organized group of persons, whether incorporated or not, 

 or a receiver, trustee, or other liquidating agent of any of the 

 foregoing.

 (5) Electric utility company.--The term ``electric utility 

 company'' means any company that owns or operates facilities 

 used for the generation, transmission, or distribution of 

 electric energy for sale.

 (6) Exempt wholesale generator and foreign utility 

 company.--The terms ``exempt wholesale generator'' and ``foreign 

 utility company'' have the same meanings as in sections 32 and 

 33, respectively, of the Public Utility Holding Company Act of 

 1935 (15 U.S.C. 79z-5a, 79z-5b), as those sections existed on 

 the day before the effective date of this subtitle.

 (7) Gas utility company.--The term ``gas utility company'' 

 means any company that owns or operates facilities used for 

 distribution at retail (other than the distribution only in 

 enclosed portable containers or distribution to tenants or 

 employees of the company operating such facilities for their own 

 use and not for resale) of natural or manufactured gas for heat, 

 light, or power.

 (8) Holding company.--

 (A) In general.--The term ``holding company'' 

 means--

 (i) any company that directly or indirectly 

 owns, controls, or holds, with power to vote, 10 

 percent or more of the outstanding voting 

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 securities of a public-utility company or of a 

 holding company of any public-utility company; and

 (ii) any person, determined by the Commission, 

 after notice and opportunity for hearing, to 

 exercise directly or indirectly (either alone or 

 pursuant to an arrangement or understanding with 

 one or more persons) such a controlling influence 

 over the management or policies of any public-

 utility company or holding company as to make it 

 necessary or appropriate for the rate protection 

 of utility customers with respect to rates that 

 such person be subject to the obligations,

[[Page 119 STAT. 973]]

 duties, and liabilities imposed by this subtitle 

 upon holding companies.

 (B) Exclusions.--The term ``holding company'' shall 

 not include--

 (i) a bank, savings association, or trust 

 company, or their operating subsidiaries that own, 

 control, or hold, with the power to vote, public 

 utility or public utility holding company 

 securities so long as the securities are--

 (I) held as collateral for a loan;

 (II) held in the ordinary course of 

 business as a fiduciary; or

 (III) acquired solely for purposes 

 of liquidation and in connection with a 

 loan previously contracted for and owned 

 beneficially for a period of not more 

 than two years; or

 (ii) a broker or dealer that owns, controls, 

 or holds with the power to vote public utility or 

 public utility holding company securities so long 

 as the securities are--

 (I) not beneficially owned by the 

 broker or dealer and are subject to any 

 voting instructions which may be given 

 by customers or their assigns; or

 (II) acquired within 12 months in 

 the ordinary course of business as a 

 broker, dealer, or underwriter with the 

 bona fide intention of effecting 

 distribution of the specific securities 

 so acquired.

 (9) Holding company system.--The term ``holding company 

 system'' means a holding company, together with its subsidiary 

 companies.

 (10) Jurisdictional rates.--The term ``jurisdictional 

 rates'' means rates accepted or established by the Commission 

 for the transmission of electric energy in interstate commerce, 

 the sale of electric energy at wholesale in interstate commerce, 

 the transportation of natural gas in interstate commerce, and 

 the sale in interstate commerce of natural gas for resale for 

 ultimate public consumption for domestic, commercial, 

 industrial, or any other use.

 (11) Natural gas company.--The term ``natural gas company'' 

 means a person engaged in the transportation of natural gas in 

 interstate commerce or the sale of such gas in interstate 

 commerce for resale.

 (12) Person.--The term ``person'' means an individual or 

 company.

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 (13) Public utility.--The term ``public utility'' means any 

 person who owns or operates facilities used for transmission of 

 electric energy in interstate commerce or sales of electric 

 energy at wholesale in interstate commerce.

 (14) Public-utility company.--The term ``public-utility 

 company'' means an electric utility company or a gas utility 

 company.

 (15) State commission.--The term ``State commission'' means 

 any commission, board, agency, or officer, by whatever name 

 designated, of a State, municipality, or other political 

 subdivision of a State that, under the laws of such State, has 

 jurisdiction to regulate public utility companies.

[[Page 119 STAT. 974]]

 (16) Subsidiary company.--The term ``subsidiary company'' of 

 a holding company means--

 (A) any company, 10 percent or more of the 

 outstanding voting securities of which are directly or 

 indirectly owned, controlled, or held with power to 

 vote, by such holding company; and

 (B) any person, the management or policies of which 

 the Commission, after notice and opportunity for 

 hearing, determines to be subject to a controlling 

 influence, directly or indirectly, by such holding 

 company (either alone or pursuant to an arrangement or 

 understanding with one or more other persons) so as to 

 make it necessary for the rate protection of utility 

 customers with respect to rates that such person be 

 subject to the obligations, duties, and liabilities 

 imposed by this subtitle upon subsidiary companies of 

 holding companies.

 (17) Voting security.--The term ``voting security'' means 

 any security presently entitling the owner or holder thereof to 

 vote in the direction or management of the affairs of a company.

SEC. 1263. REPEAL OF THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935.

 The Public Utility Holding Company Act of 1935 (15 U.S.C. 79 et 

seq.) is repealed.

SEC. 1264. <<NOTE: 42 USC 16452.>> FEDERAL ACCESS TO BOOKS AND RECORDS.

 (a) In General.--Each holding company and each associate company 

thereof shall maintain, and shall make available to the Commission, such 

books, accounts, memoranda, and other records as the Commission 

determines are relevant to costs incurred by a public utility or natural 

gas company that is an associate company of such holding company and 

necessary or appropriate for the protection of utility customers with 

respect to jurisdictional rates.

 (b) Affiliate Companies.--Each affiliate of a holding company or of 

any subsidiary company of a holding company shall maintain, and shall 

make available to the Commission, such books, accounts, memoranda, and 

other records with respect to any transaction with another affiliate, as 

the Commission determines are relevant to costs incurred by a public 

utility or natural gas company that is an associate company of such 

holding company and necessary or appropriate for the protection of 

utility customers with respect to jurisdictional rates.

 (c) Holding Company Systems.--The Commission may examine the books, 

accounts, memoranda, and other records of any company in a holding 

company system, or any affiliate thereof, as the Commission determines 

are relevant to costs incurred by a public utility or natural gas 

company within such holding company system and necessary or appropriate 

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for the protection of utility customers with respect to jurisdictional 

rates.

 (d) Confidentiality.--No member, officer, or employee of the 

Commission shall divulge any fact or information that may come to his or 

her knowledge during the course of examination of books, accounts, 

memoranda, or other records as provided in this section, except as may 

be directed by the Commission or by a court of competent jurisdiction.

[[Page 119 STAT. 975]]

SEC. 1265. <<NOTE: 42 USC 16453.>> STATE ACCESS TO BOOKS AND RECORDS.

 (a) In General.--Upon the written request of a State commission 

having jurisdiction to regulate a public-utility company in a holding 

company system, the holding company or any associate company or 

affiliate thereof, other than such public-utility company, wherever 

located, shall produce for inspection books, accounts, memoranda, and 

other records that--

 (1) have been identified in reasonable detail in a 

 proceeding before the State commission;

 (2) the State commission determines are relevant to costs 

 incurred by such public-utility company; and

 (3) are necessary for the effective discharge of the 

 responsibilities of the State commission with respect to such 

 proceeding.

 (b) Limitation.--Subsection (a) does not apply to any person that is 

a holding company solely by reason of ownership of one or more 

qualifying facilities under the Public Utility Regulatory Policies Act 

of 1978 (16 U.S.C. 2601 et seq.).

 (c) Confidentiality of Information.--The production of books, 

accounts, memoranda, and other records under subsection (a) shall be 

subject to such terms and conditions as may be necessary and appropriate 

to safeguard against unwarranted disclosure to the public of any trade 

secrets or sensitive commercial information.

 (d) Effect on State Law.--Nothing in this section shall preempt 

applicable State law concerning the provision of books, accounts, 

memoranda, and other records, or in any way limit the rights of any 

State to obtain books, accounts, memoranda, and other records under any 

other Federal law, contract, or otherwise.

 (e) Court Jurisdiction.--Any United States district court located in 

the State in which the State commission referred to in subsection (a) is 

located shall have jurisdiction to enforce compliance with this section.

SEC. 1266. <<NOTE: 42 USC 16454.>> EXEMPTION AUTHORITY.

 (a) <<NOTE: Deadline.>> Rulemaking.--Not later than 90 days after 

the effective date of this subtitle, the Commission shall issue a final 

rule to exempt from the requirements of section 1264 (relating to 

Federal access to books and records) any person that is a holding 

company, solely with respect to one or more--

 (1) qualifying facilities under the Public Utility 

 Regulatory Policies Act of 1978 (16 U.S.C. 2601 et seq.);

 (2) exempt wholesale generators; or

 (3) foreign utility companies.

 (b) Other Authority.--The Commission shall exempt a person or 

transaction from the requirements of section 1264 (relating to Federal 

access to books and records) if, upon application or upon the motion of 

the Commission--

 (1) the Commission finds that the books, accounts, 

 memoranda, and other records of any person are not relevant to 

 the jurisdictional rates of a public utility or natural gas 

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 company; or

 (2) the Commission finds that any class of transactions is 

 not relevant to the jurisdictional rates of a public utility or 

 natural gas company.

[[Page 119 STAT. 976]]

SEC. 1267. <<NOTE: 42 USC 16455.>> AFFILIATE TRANSACTIONS.

 (a) Commission Authority Unaffected.--Nothing in this subtitle shall 

limit the authority of the Commission under the Federal Power Act (16 

U.S.C. 791a et seq.) to require that jurisdictional rates are just and 

reasonable, including the ability to deny or approve the pass through of 

costs, the prevention of cross-subsidization, and the issuance of such 

rules and regulations as are necessary or appropriate for the protection 

of utility consumers.

 (b) Recovery of Costs.--Nothing in this subtitle shall preclude the 

Commission or a State commission from exercising its jurisdiction under 

otherwise applicable law to determine whether a public-utility company, 

public utility, or natural gas company may recover in rates any costs of 

an activity performed by an associate company, or any costs of goods or 

services acquired by such public-utility company from an associate 

company.

SEC. 1268. <<NOTE: 42 USC 16456.>> APPLICABILITY.

 Except as otherwise specifically provided in this subtitle, no 

provision of this subtitle shall apply to, or be deemed to include--

 (1) the United States;

 (2) a State or any political subdivision of a State;

 (3) any foreign governmental authority not operating in the 

 United States;

 (4) any agency, authority, or instrumentality of any entity 

 referred to in paragraph (1), (2), or (3); or

 (5) any officer, agent, or employee of any entity referred 

 to in paragraph (1), (2), (3), or (4) acting as such in the 

 course of his or her official duty.

SEC. 1269. <<NOTE: 42 USC 16457.>> EFFECT ON OTHER REGULATIONS.

 Nothing in this subtitle precludes the Commission or a State 

commission from exercising its jurisdiction under otherwise applicable 

law to protect utility customers.

SEC. 1270. <<NOTE: 42 USC 16458.>> ENFORCEMENT.

 The Commission shall have the same powers as set forth in sections 

306 through 317 of the Federal Power Act (16 U.S.C. 825e-825p) to 

enforce the provisions of this subtitle.

SEC. 1271. <<NOTE: 42 USC 16459.>> SAVINGS PROVISIONS.

 (a) In General.--Nothing in this subtitle, or otherwise in the 

Public Utility Holding Company Act of 1935, or rules, regulations, or 

orders thereunder, prohibits a person from engaging in or continuing to 

engage in activities or transactions in which it is legally engaged or 

authorized to engage on the date of enactment of this Act, if that 

person continues to comply with the terms (other than an expiration date 

or termination date) of any such authorization, whether by rule or by 

order.

 (b) Effect on Other Commission Authority.--Nothing in this subtitle 

limits the authority of the Commission under the Federal Power Act (16 

U.S.C. 791a et seq.) or the Natural Gas Act (15 U.S.C. 717 et seq.).

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 (c) Tax Treatment.--Tax treatment under section 1081 of the Internal 

Revenue Code of 1986 as a result of transactions ordered in compliance 

with the Public Utility Holding Company Act of 1935 (15 U.S.C. 79 et 

seq.) shall not be affected in any manner due to the repeal of that Act 

and the enactment of the Public Utility Holding Company Act of 2005.

[[Page 119 STAT. 977]]

SEC. 1272. <<NOTE: Deadline. 42 USC 16460.>> IMPLEMENTATION.

 Not later than 4 months after the date of enactment of this 

subtitle, the Commission shall--

 (1) <<NOTE: Regulations.>> issue such regulations as may be 

 necessary or appropriate to implement this subtitle (other than 

 section 1265, relating to State access to books and records); 

 and

 (2) submit to Congress detailed recommendations on technical 

 and conforming amendments to Federal law necessary to carry out 

 this subtitle and the amendments made by this subtitle.

SEC. 1273. TRANSFER <<NOTE: Records. 42 USC 16461.>> OF RESOURCES.

 All books and records that relate primarily to the functions 

transferred to the Commission under this subtitle shall be transferred 

from the Securities and Exchange Commission to the Commission.

SEC. 1274. <<NOTE: 42 USC 16451 note.>> EFFECTIVE DATE.

 (a) In General.--Except for section 1272 (relating to 

implementation), this subtitle shall take effect 6 months after the date 

of enactment of this subtitle.

 (b) Compliance With Certain Rules.--If the Commission approves and 

makes effective any final rulemaking modifying the standards of conduct 

governing entities that own, operate, or control facilities for 

transmission of electricity in interstate commerce or transportation of 

natural gas in interstate commerce prior to the effective date of this 

subtitle, any action taken by a public-utility company or utility 

holding company to comply with the requirements of such rulemaking shall 

not subject such public-utility company or utility holding company to 

any regulatory requirement applicable to a holding company under the 

Public Utility Holding Company Act of 1935 (15 U.S.C. 79 et seq.).

SEC. 1275. <<NOTE: 42 USC 16462.>> SERVICE ALLOCATION.

 (a) Definition of Public Utility.--In this section, the term 

``public utility'' has the meaning given the term in section 201(e) of 

the Federal Power Act (16 U.S.C. 824(e)).

 (b) FERC Review.--In the case of non-power goods or administrative 

or management services provided by an associate company organized 

specifically for the purpose of providing such goods or services to any 

public utility in the same holding company system, at the election of 

the system or a State commission having jurisdiction over the public 

utility, the Commission, after the effective date of this subtitle, 

shall review and authorize the allocation of the costs for such goods or 

services to the extent relevant to that associate company.

 (c) Effect on Federal and State Law.--Nothing in this section shall 

affect the authority of the Commission or a State commission under other 

applicable law.

 (d) <<NOTE: Deadline.>> Rules.--Not later than 4 months after the 

date of enactment of this Act, the Commission shall issue rules (which 

rules shall be effective no earlier than the effective date of this 

subtitle) to exempt from the requirements of this section any company in 

a holding company system whose public utility operations are confined 

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substantially to a single State and any other class of transactions that 

the Commission finds is not relevant to the jurisdictional rates of a 

public utility.

[[Page 119 STAT. 978]]

SEC. 1276. <<NOTE: 42 USC 16463.>> AUTHORIZATION OF APPROPRIATIONS.

 There are authorized to be appropriated such funds as may be 

necessary to carry out this subtitle.

SEC. 1277. CONFORMING AMENDMENTS TO THE FEDERAL POWER ACT.

 (a) Conflict of Jurisdiction.--Section 318 of the Federal Power Act 

(16 U.S.C. 825q) is repealed.

 (b) Definitions.--(1) Section 201(g)(5) of the Federal Power Act (16 

U.S.C. 824(g)(5)) is amended by striking ``1935'' and inserting 

``2005''.

 (2) Section 214 of the Federal Power Act (16 U.S.C. 824m) is amended 

by striking ``1935'' and inserting ``2005''.

 Subtitle G--Market Transparency, Enforcement, and Consumer Protection

SEC. 1281. ELECTRICITY MARKET TRANSPARENCY.

 Part II of the Federal Power Act is amended by adding at the end the 

following:

``SEC. 220. <<NOTE: 16 USC 824t.>> ELECTRICITY MARKET TRANSPARENCY 

 RULES.

 ``(a)(1) The Commission is directed to facilitate price transparency 

in markets for the sale and transmission of electric energy in 

interstate commerce, having due regard for the public interest, the 

integrity of those markets, fair competition, and the protection of 

consumers.

 ``(2) The Commission may prescribe such rules as the Commission 

determines necessary and appropriate to carry out the purposes of this 

section. The rules shall provide for the dissemination, on a timely 

basis, of information about the availability and prices of wholesale 

electric energy and transmission service to the Commission, State 

commissions, buyers and sellers of wholesale electric energy, users of 

transmission services, and the public.

 ``(3) The Commission may--

 ``(A) obtain the information described in paragraph (2) from 

 any market participant; and

 ``(B) rely on entities other than the Commission to receive 

 and make public the information, subject to the disclosure rules 

 in subsection (b).

 ``(4) In carrying out this section, the Commission shall consider 

the degree of price transparency provided by existing price publishers 

and providers of trade processing services, and shall rely on such 

publishers and services to the maximum extent possible. The Commission 

may establish an electronic information system if it determines that 

existing price publications are not adequately providing price discovery 

or market transparency. Nothing in this section, however, shall affect 

any electronic information filing requirements in effect under this Act 

as of the date of enactment of this section.

 ``(b)(1) Rules described in subsection (a)(2), if adopted, shall 

exempt from disclosure information the Commission determines would, if 

disclosed, be detrimental to the operation of an effective market or 

jeopardize system security.

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 ``(2) In determining the information to be made available under this 

section and time to make the information available, the Commission shall 

seek to ensure that consumers and competitive

[[Page 119 STAT. 979]]

markets are protected from the adverse effects of potential collusion or 

other anticompetitive behaviors that can be facilitated by untimely 

public disclosure of transaction-specific information.

 ``(c)(1) <<NOTE: Deadline.>> Within 180 days of enactment of this 

section, the Commission shall conclude a memorandum of understanding 

with the Commodity Futures Trading Commission relating to information 

sharing, which shall include, among other things, provisions ensuring 

that information requests to markets within the respective jurisdiction 

of each agency are properly coordinated to minimize duplicative 

information requests, and provisions regarding the treatment of 

proprietary trading information.

 ``(2) Nothing in this section may be construed to limit or affect 

the exclusive jurisdiction of the Commodity Futures Trading Commission 

under the Commodity Exchange Act (7 U.S.C. 1 et seq.).

 ``(d) The Commission shall not require entities who have a de 

minimis market presence to comply with the reporting requirements of 

this section.

 ``(e)(1) Except as provided in paragraph (2), no person shall be 

subject to any civil penalty under this section with respect to any 

violation occurring more than 3 years before the date on which the 

person is provided notice of the proposed penalty under section 316A.

 ``(2) Paragraph (1) shall not apply in any case in which the 

Commission finds that a seller that has entered into a contract for the 

sale of electric energy at wholesale or transmission service subject to 

the jurisdiction of the Commission has engaged in fraudulent market 

manipulation activities materially affecting the contract in violation 

of section 222.

 ``(f) This section shall not apply to a transaction for the purchase 

or sale of wholesale electric energy or transmission services within the 

area described in section 212(k)(2)(A).''.

SEC. 1282. FALSE STATEMENTS.

 Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is amended 

by adding at the end the following:

``SEC. 221. <<NOTE: 16 USC 824u.>> PROHIBITION ON FILING FALSE 

 INFORMATION.

 ``No entity (including an entity described in section 201(f)) shall 

willfully and knowingly report any information relating to the price of 

electricity sold at wholesale or the availability of transmission 

capacity, which information the person or any other entity knew to be 

false at the time of the reporting, to a Federal agency with intent to 

fraudulently affect the data being compiled by the Federal agency.''.

SEC. 1283. MARKET MANIPULATION.

 Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is amended 

by adding at the end the following:

``SEC. 222. <<NOTE: 16 USC 824v.>> PROHIBITION OF ENERGY MARKET 

 MANIPULATION.

 ``(a) In General.--It shall be unlawful for any entity (including an 

entity described in section 201(f)), directly or indirectly, to use or 

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employ, in connection with the purchase or sale of electric energy or 

the purchase or sale of transmission services subject to the 

jurisdiction of the Commission, any manipulative or deceptive device or 

contrivance (as those terms are used in section 10(b) of the Securities 

Exchange Act of 1934 (15 U.S.C. 78j(b))), in contravention

[[Page 119 STAT. 980]]

of such rules and regulations as the Commission may prescribe as 

necessary or appropriate in the public interest or for the protection of 

electric ratepayers.

 ``(b) No Private Right of Action.--Nothing in this section shall be 

construed to create a private right of action.''.

SEC. 1284. ENFORCEMENT.

 (a) Complaints.--Section 306 of the Federal Power Act (16 U.S.C. 

825e) is amended--

 (1) by inserting ``electric utility,'' after ``Any 

 person,''; and

 (2) by inserting ``, transmitting utility,'' after 

 ``licensee'' each place it appears.

 (b) Investigations.--Section 307(a) of the Federal Power Act (16 

U.S.C. 825f(a)) is amended--

 (1) by inserting ``, electric utility, transmitting utility, 

 or other entity'' after ``person'' each place it appears; and

 (2) in the first sentence, by inserting before the period at 

 the end the following: ``, or in obtaining information about the 

 sale of electric energy at wholesale in interstate commerce and 

 the transmission of electric energy in interstate commerce''.

 (c) Review of Commission Orders.--Section 313(a) of the Federal 

Power Act (16 U.S.C. 825l) is amended by inserting ``electric utility,'' 

after ``person,'' in the first 2 places it appears and by striking ``any 

person unless such person'' and inserting ``any entity unless such 

entity''.

 (d) Criminal Penalties.--Section 316 of the Federal Power Act (16 

U.S.C. 825o) is amended--

 (1) in subsection (a)--

 (A) by striking ``$5,000'' and inserting 

 ``$1,000,000''; and

 (B) by striking ``two years'' and inserting ``5 

 years'';

 (2) in subsection (b), by striking ``$500'' and inserting 

 ``$25,000''; and

 (3) by striking subsection (c).

 (e) Civil Penalties.--Section 316A of the Federal Power Act (16 

U.S.C. 825o-1) is amended--

 (1) by striking ``section 211, 212, 213, or 214'' each place 

 it appears and inserting ``part II''; and

 (2) in subsection (b), by striking ``$10,000'' and inserting 

 ``$1,000,000''.

SEC. 1285. REFUND EFFECTIVE DATE.

 Section 206(b) of the Federal Power Act (16 U.S.C. 824e(b)) is 

amended as follows:

 (1) By striking ``the date 60 days after the filing of such 

 complaint nor later than 5 months after the expiration of such 

 60-day period'' in the second sentence and inserting ``the date 

 of the filing of such complaint nor later than 5 months after 

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 the filing of such complaint''.

 (2) By striking ``60 days after'' in the third sentence and 

 inserting ``of''.

 (3) By striking ``expiration of such 60-day period'' in the 

 third sentence and inserting ``publication date''.

 (4) By striking the fifth sentence and inserting the 

 following: ``If no final decision is rendered by the conclusion 

 of the 180-day period commencing upon initiation of a proceeding 

 pursuant to this section, the Commission shall state the reasons

[[Page 119 STAT. 981]]

 why it has failed to do so and shall state its best estimate as 

 to when it reasonably expects to make such decision.''.

SEC. 1286. REFUND AUTHORITY.

 Section 206 of the Federal Power Act (16 U.S.C. 824e) is amended by 

adding at the end the following:

 ``(e)(1) In this subsection:

 ``(A) The term `short-term sale' means an agreement for the 

 sale of electric energy at wholesale in interstate commerce that 

 is for a period of 31 days or less (excluding monthly contracts 

 subject to automatic renewal).

 ``(B) The term `applicable Commission rule' means a 

 Commission rule applicable to sales at wholesale by public 

 utilities that the Commission determines after notice and 

 comment should also be applicable to entities subject to this 

 subsection.

 ``(2) If an entity described in section 201(f) voluntarily makes a 

short-term sale of electric energy through an organized market in which 

the rates for the sale are established by Commission-approved tariff 

(rather than by contract) and the sale violates the terms of the tariff 

or applicable Commission rules in effect at the time of the sale, the 

entity shall be subject to the refund authority of the Commission under 

this section with respect to the violation.

 ``(3) This section shall not apply to--

 ``(A) any entity that sells in total (including affiliates 

 of the entity) less than 8,000,000 megawatt hours of electricity 

 per year; or

 ``(B) an electric cooperative.

 ``(4)(A) The Commission shall have refund authority under paragraph 

(2) with respect to a voluntary short term sale of electric energy by 

the Bonneville Power Administration only if the sale is at an unjust and 

unreasonable rate.

 ``(B) The Commission may order a refund under subparagraph (A) only 

for short-term sales made by the Bonneville Power Administration at 

rates that are higher than the highest just and reasonable rate charged 

by any other entity for a short-term sale of electric energy in the same 

geographic market for the same, or most nearly comparable, period as the 

sale by the Bonneville Power Administration.

 ``(C) In the case of any Federal power marketing agency or the 

Tennessee Valley Authority, the Commission shall not assert or exercise 

any regulatory authority or power under paragraph (2) other than the 

ordering of refunds to achieve a just and reasonable rate.''.

SEC. 1287. <<NOTE: 42 USC 16471.>> CONSUMER PRIVACY AND UNFAIR TRADE 

 PRACTICES.

 (a) Privacy.--The Federal Trade Commission may issue rules 

protecting the privacy of electric consumers from the disclosure of 

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consumer information obtained in connection with the sale or delivery of 

electric energy to electric consumers.

 (b) Slamming.--The Federal Trade Commission may issue rules 

prohibiting the change of selection of an electric utility except with 

the informed consent of the electric consumer or if approved by the 

appropriate State regulatory authority.

 (c) Cramming.--The Federal Trade Commission may issue rules 

prohibiting the sale of goods and services to an electric consumer 

unless expressly authorized by law or the electric consumer.

[[Page 119 STAT. 982]]

 (d) Rulemaking.--The Federal Trade Commission shall proceed in 

accordance with section 553 of title 5, United States Code, when 

prescribing a rule under this section.

 (e) State Authority.--If the Federal Trade Commission determines 

that a State's regulations provide equivalent or greater protection than 

the provisions of this section, such State regulations shall apply in 

that State in lieu of the regulations issued by the Commission under 

this section.

 (f) Definitions.--For purposes of this section:

 (1) State regulatory authority.--The term ``State regulatory 

 authority'' has the meaning given that term in section 3(21) of 

 the Federal Power Act (16 U.S.C. 796(21)).

 (2) Electric consumer and electric utility.--The terms 

 ``electric consumer'' and ``electric utility'' have the meanings 

 given those terms in section 3 of the Public Utility Regulatory 

 Policies Act of 1978 (16 U.S.C. 2602).

SEC. 1288. AUTHORITY OF COURT TO PROHIBIT INDIVIDUALS FROM SERVING AS 

 OFFICERS, DIRECTORS, AND ENERGY TRADERS.

 Section 314 of the Federal Power Act (16 U.S.C. 825m) is amended by 

adding at the end the following:

 ``(d) In any proceedings under subsection (a), the court may 

prohibit, conditionally or unconditionally, and permanently or for such 

period of time as the court determines, any individual who is engaged or 

has engaged in practices constituting a violation of section 221 (and 

related rules and regulations) from--

 ``(1) acting as an officer or director of an electric 

 utility; or

 ``(2) engaging in the business of purchasing or selling--

 ``(A) electric energy; or

 ``(B) transmission services subject to the 

 jurisdiction of the Commission.''.

SEC. 1289. MERGER REVIEW REFORM.

 (a) In General.--Section 203(a) of the Federal Power Act (16 U.S.C. 

824b(a)) is amended to read as follows:

 ``(a)(1) No public utility shall, without first having secured an 

order of the Commission authorizing it to do so--

 ``(A) sell, lease, or otherwise dispose of the whole 

 of its facilities subject to the jurisdiction of the 

 Commission, or any part thereof of a value in excess of 

 $10,000,000;

 ``(B) merge or consolidate, directly or indirectly, 

 such facilities or any part thereof with those of any 

 other person, by any means whatsoever;

 ``(C) purchase, acquire, or take any security with a 

 value in excess of $10,000,000 of any other public 

 utility; or

 ``(D) purchase, lease, or otherwise acquire an 

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 existing generation facility--

 ``(i) that has a value in excess of 

 $10,000,000; and

 ``(ii) that is used for interstate wholesale 

 sales and over which the Commission has 

 jurisdiction for ratemaking purposes.

 ``(2) No holding company in a holding company system that 

 includes a transmitting utility or an electric utility shall 

 purchase, acquire, or take any security with a value in excess

[[Page 119 STAT. 983]]

 of $10,000,000 of, or, by any means whatsoever, directly or 

 indirectly, merge or consolidate with, a transmitting utility, 

 an electric utility company, or a holding company in a holding 

 company system that includes a transmitting utility, or an 

 electric utility company, with a value in excess of $10,000,000 

 without first having secured an order of the Commission 

 authorizing it to do so.

 ``(3) <<NOTE: Notice.>> Upon receipt of an application for 

 such approval the Commission shall give reasonable notice in 

 writing to the Governor and State commission of each of the 

 States in which the physical property affected, or any part 

 thereof, is situated, and to such other persons as it may deem 

 advisable.

 ``(4) After notice and opportunity for hearing, the 

 Commission shall approve the proposed disposition, 

 consolidation, acquisition, or change in control, if it finds 

 that the proposed transaction will be consistent with the public 

 interest, and will not result in cross-subsidization of a non-

 utility associate company or the pledge or encumbrance of 

 utility assets for the benefit of an associate company, unless 

 the Commission determines that the cross-subsidization, pledge, 

 or encumbrance will be consistent with the public interest.

 ``(5) <<NOTE: Regulations. Procedures.>> The Commission 

 shall, by rule, adopt procedures for the expeditious 

 consideration of applications for the approval of dispositions, 

 consolidations, or acquisitions, under this section. Such rules 

 shall identify classes of transactions, or specify criteria for 

 transactions, that normally meet the standards established in 

 paragraph (4). The Commission shall provide expedited review for 

 such transactions. <<NOTE: Deadlines.>> The Commission shall 

 grant or deny any other application for approval of a 

 transaction not later than 180 days after the application is 

 filed. If the Commission does not act within 180 days, such 

 application shall be deemed granted unless the Commission finds, 

 based on good cause, that further consideration is required to 

 determine whether the proposed transaction meets the standards 

 of paragraph (4) and issues an order tolling the time for acting 

 on the application for not more than 180 days, at the end of 

 which additional period the Commission shall grant or deny the 

 application.

 ``(6) For purposes of this subsection, the terms `associate 

 company', `holding company', and `holding company system' have 

 the meaning given those terms in the Public Utility Holding 

 Company Act of 2005.''.

 (b) <<NOTE: 16 USC 824b note.>> Effective Date.--The amendments made 

by this section shall take effect 6 months after the date of enactment 

of this Act.

 (c) Transition Provision.--The amendments made by subsection (a) 

shall not apply to any application under section 203 of the Federal 

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Power Act (16 U.S.C. 824b) that was filed on or before the date of 

enactment of this Act.

SEC. 1290. RELIEF FOR EXTRAORDINARY VIOLATIONS.

 (a) Application.--This section applies to any contract entered into 

the Western Interconnection prior to June 20, 2001, with a seller of 

wholesale electricity that the Commission has--

 (1) found to have manipulated the electricity market 

 resulting in unjust and unreasonable rates; and

[[Page 119 STAT. 984]]

 (2) revoked the seller's authority to sell any electricity 

 at market-based rates.

 (b) Relief.--Notwithstanding section 222 of the Federal Power Act 

(as added by section 1262), any provision of title 11, United States 

Code, or any other provision of law, in the case of a contract described 

in subsection (a), the Commission shall have exclusive jurisdiction 

under the Federal Power Act (16 U.S.C. 791a et seq.) to determine 

whether a requirement to make termination payments for power not 

delivered by the seller, or any successor in interest of the seller, is 

not permitted under a rate schedule (or contract under such a schedule) 

or is otherwise unlawful on the grounds that the contract is unjust and 

unreasonable or contrary to the public interest.

 (c) Applicability.--This section applies to any proceeding pending 

on the date of enactment of this section involving a seller described in 

subsection (a) in which there is not a final, nonappealable order by the 

Commission or any other jurisdiction determining the respective rights 

of the seller.

 Subtitle H--Definitions

SEC. 1291. DEFINITIONS.

 (a) <<NOTE: 42 USC 16481.>> Commission.--In this title, the term 

``Commission'' means the Federal Energy Regulatory Commission.

 (b) Amendment.--Section 3 of the Federal Power Act (16 U.S.C. 796) 

is amended--

 (1) by striking paragraphs (22) and (23) and inserting the 

 following:

 ``(22) Electric utility.--(A) The term `electric utility' 

 means a person or Federal or State agency (including an entity 

 described in section 201(f)) that sells electric energy.

 ``(B) The term `electric utility' includes the Tennessee 

 Valley Authority and each Federal power marketing 

 administration.

 ``(23) Transmitting utility.--The term `transmitting 

 utility' means an entity (including an entity described in 

 section 201(f)) that owns, operates, or controls facilities used 

 for the transmission of electric energy--

 ``(A) in interstate commerce;

 ``(B) for the sale of electric energy at 

 wholesale.''; and

 (2) by adding at the end the following:

 ``(26) Electric cooperative.--The term `electric 

 cooperative' means a cooperatively owned electric utility.

 ``(27) RTO.--The term `Regional Transmission Organization' 

 or `RTO' means an entity of sufficient regional scope approved 

 by the Commission--

 ``(A) to exercise operational or functional control 

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 of facilities used for the transmission of electric 

 energy in interstate commerce; and

 ``(B) to ensure nondiscriminatory access to the 

 facilities.

 ``(28) ISO.--The term `Independent System Operator' or `ISO' 

 means an entity approved by the Commission--

 ``(A) to exercise operational or functional control 

 of facilities used for the transmission of electric 

 energy in interstate commerce; and

 ``(B) to ensure nondiscriminatory access to the 

 facilities.

[[Page 119 STAT. 985]]

 ``(29) Transmission organization.--The term `Transmission 

 Organization' means a Regional Transmission Organization, 

 Independent System Operator, independent transmission provider, 

 or other transmission organization finally approved by the 

 Commission for the operation of transmission facilities.''.

 (c) Applicability.--Section 201(f) of the Federal Power Act (16 

U.S.C. 824(f)) is amended by striking ``political subdivision of a 

state,'' and inserting ``political subdivision of a State, an electric 

cooperative that receives financing under the Rural Electrification Act 

of 1936 (7 U.S.C. 901 et seq.) or that sells less than 4,000,000 

megawatt hours of electricity per year,''.

 Subtitle I--Technical and Conforming Amendments

SEC. 1295. CONFORMING AMENDMENTS.

 (a) Section 201 of the Federal Power Act (16 U.S.C. 824) is 

amended--

 (1) in subsection (b)(2)--

 (A) in the first sentence--

 (i) by striking ``The'' and inserting 

 ``Notwithstanding section 201(f), the''; and

 (ii) by striking ``210, 211, and 212'' and 

 inserting ``203(a)(2), 206(e), 210, 211, 211A, 

 212, 215, 216, 217, 218, 219, 220, 221, and 222''; 

 and

 (B) in the second sentence--

 (i) by inserting ``or rule'' after ``any 

 order''; and

 (ii) by striking ``210 or 211'' and inserting 

 ``203(a)(2), 206(e), 210, 211, 211A, 212, 215, 

 216, 217, 218, 219, 220, 221, or 222''; and

 (2) in subsection (e), by striking ``210, 211, or 212'' and 

 inserting ``206(e), 206(f), 210, 211, 211A, 212, 215, 216, 217, 

 218, 219, 220, 221, or 222''.

 (b) Section 206 of the Federal Power Act (16 U.S.C. 824e) is 

amended--

 (1) in the first sentence of subsection (a), by striking 

 ``hearing had'' and inserting ``hearing held''; and

 (2) in the seventh sentence of subsection (b), by striking 

 ``the public utility to make''.

 (c) Section 211 of the Federal Power Act (16 U.S.C. 824j) is 

amended--

 (1) in subsection (c)--

 (A) by striking ``(2)'';

 (B) by striking ``(A)'' and inserting ``(1)''

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 (C) by striking ``(B)'' and inserting ``(2)''; and

 (D) by striking ``termination of modification'' and 

 inserting ``termination or modification''; and

 (2) in the second sentence of subsection (d)(1), by striking 

 ``electric utility'' the second place it appears and inserting 

 ``transmitting utility''.

 (d) Section 315(c) of the Federal Power Act (16 U.S.C. 825n(c)) is 

amended by striking ``subsection'' and inserting ``section''.

[[Page 119 STAT. 986]]

 Subtitle J--Economic Dispatch

SEC. 1298. ECONOMIC DISPATCH.

 Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is amended 

by adding at the end the following:

``SEC. 223. <<NOTE: 16 USC 824w.>> JOINT BOARDS ON ECONOMIC DISPATCH.

 ``(a) <<NOTE: Establishment.>> In General.--The Commission shall 

convene joint boards on a regional basis pursuant to section 209 of this 

Act to study the issue of security constrained economic dispatch for the 

various market regions. The Commission shall designate the appropriate 

regions to be covered by each such joint board for purposes of this 

section.

 ``(b) Membership.--The Commission shall request each State to 

nominate a representative for the appropriate regional joint board, and 

shall designate a member of the Commission to chair and participate as a 

member of each such board.

 ``(c) Powers.--The sole authority of each joint board convened under 

this section shall be to consider issues relevant to what constitutes 

`security constrained economic dispatch' and how such a mode of 

operating an electric energy system affects or enhances the reliability 

and affordability of service to customers in the region concerned and to 

make recommendations to the Commission regarding such issues.

 ``(d) Report to the Congress.--Within 1 year after enactment of this 

section, the Commission shall issue a report and submit such report to 

the Congress regarding the recommendations of the joint boards under 

this section and the Commission may consolidate the recommendations of 

more than one such regional joint board, including any consensus 

recommendations for statutory or regulatory reform.''.

 TITLE <<NOTE: Energy Tax Incentives Act of 2005.>> XIII--ENERGY POLICY 

TAX INCENTIVES

SEC. 1300. SHORT TITLE; AMENDMENT OF 1986 CODE.

 (a) <<NOTE: 26 USC 1 note.>> Short Title.--This title may be cited 

as the ``Energy Tax Incentives Act of 2005''.

 (b) <<NOTE: 26 USC 1 et seq.>> Amendment of 1986 Code.--Except as 

otherwise expressly provided, whenever in this title an amendment or 

repeal is expressed in terms of an amendment to, or repeal of, a section 

or other provision, the reference shall be considered to be made to a 

section or other provision of the Internal Revenue Code of 1986.

 Subtitle A--Electricity Infrastructure

SEC. 1301. EXTENSION AND MODIFICATION OF RENEWABLE ELECTRICITY 

 PRODUCTION CREDIT.

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 (a) <<NOTE: 26 USC 45.>> 2-Year Extension for Certain Facilities.--

Section 45(d) (relating to qualified facilities) is amended--

 (1) by striking ``January 1, 2006'' each place it appears in 

 paragraphs (1), (2), (3), (5), (6), and (7) and inserting 

 ``January 1, 2008'', and

[[Page 119 STAT. 987]]

 (2) by striking ``January 1, 2006'' in paragraph (4) and 

 inserting ``January 1, 2008 (January 1, 2006, in the case of a 

 facility using solar energy)''.

 (b) <<NOTE: 26 USC 45.>> Increase in Credit Period.--Section 

45(b)(4)(B) (relating to credit period) is amended--

 (1) by inserting ``or clause (iii)'' after ``clause (ii)'' 

 in clause (i), and

 (2) by adding at the end the following:

 ``(iii) Termination.--Clause (i) shall not 

 apply to any facility placed in service after the 

 date of the enactment of this clause.''.

 (c) Expansion of Qualified Resources to Certain Hydropower.--

 (1) In general.--Section 45(c)(1) (defining qualified energy 

 resources) is amended by striking ``and'' at the end of 

 subparagraph (F), by striking the period at the end of 

 subparagraph (G) and inserting ``, and'', and by adding at the 

 end the following new subparagraph:

 ``(H) qualified hydropower production.''.

 (2) Credit rate.--Section 45(b)(4)(A) (relating to credit 

 rate) is amended by striking ``or (7)'' and inserting ``(7), or 

 (9)''.

 (3) Definition of resources.--Section 45(c) (relating to 

 qualified energy resources and refined coal) is amended by 

 adding at the end the following new paragraph:

 ``(8) Qualified hydropower production.--

 ``(A) In general.--The term `qualified hydropower 

 production' means--

 ``(i) in the case of any hydroelectric dam 

 which was placed in service on or before the date 

 of the enactment of this paragraph, the 

 incremental hydropower production for the taxable 

 year, and

 ``(ii) in the case of any nonhydroelectric dam 

 described in subparagraph (C), the hydropower 

 production from the facility for the taxable year.

 ``(B) Determination of incremental hydropower 

 production.--

 ``(i) In general.--For purposes of 

 subparagraph (A), incremental hydropower 

 production for any taxable year shall be equal to 

 the percentage of average annual hydropower 

 production at the facility attributable to the 

 efficiency improvements or additions of capacity 

 placed in service after the date of the enactment 

 of this paragraph, determined by using the same 

 water flow information used to determine an 

 historic average annual hydropower production 

 baseline for such facility. Such percentage and 

 baseline shall be certified by the Federal Energy 

 Regulatory Commission.

 ``(ii) Operational changes disregarded.--For 

 purposes of clause (i), the determination of 

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 incremental hydropower production shall not be 

 based on any operational changes at such facility 

 not directly associated with the efficiency 

 improvements or additions of capacity.

 ``(C) Nonhydroelectric dam.--For purposes of 

 subparagraph (A), a facility is described in this 

 subparagraph if--

[[Page 119 STAT. 988]]

 ``(i) the facility is licensed by the Federal 

 Energy Regulatory Commission and meets all other 

 applicable environmental, licensing, and 

 regulatory requirements,

 ``(ii) the facility was placed in service 

 before the date of the enactment of this paragraph 

 and did not produce hydroelectric power on the 

 date of the enactment of this paragraph, and

 ``(iii) turbines or other generating devices 

 are to be added to the facility after such date to 

 produce hydroelectric power, but only if there is 

 not any enlargement of the diversion structure, or 

 construction or enlargement of a bypass channel, 

 or the impoundment or any withholding of any 

 additional water from the natural stream 

 channel.''.

 (4) Facilities.--Section 45(d) <<NOTE: 26 USC 

 45.>> (relating to qualified facilities) is amended by adding at 

 the end the following new paragraph:

 ``(9) Qualified hydropower facility.--In the case of a 

 facility producing qualified hydroelectric production described 

 in subsection (c)(8), the term `qualified facility' means--

 ``(A) in the case of any facility producing 

 incremental hydropower production, such facility but 

 only to the extent of its incremental hydropower 

 production attributable to efficiency improvements or 

 additions to capacity described in subsection (c)(8)(B) 

 placed in service after the date of the enactment of 

 this paragraph and before January 1, 2008, and

 ``(B) any other facility placed in service after the 

 date of the enactment of this paragraph and before 

 January 1, 2008.

 ``(C) Credit period.--In the case of a qualified 

 facility described in subparagraph (A), the 10-year 

 period referred to in subsection (a) shall be treated as 

 beginning on the date the efficiency improvements or 

 additions to capacity are placed in service.''.

 (d) Indian Coal.--

 (1) Production facilities.--Subsection (e) of section 45 

 (relating to definitions and special rules) is amended by adding 

 at the end the following new paragraph:

 ``(10) Indian coal production facilities.--

 ``(A) Determination of credit amount.--In the case 

 of a producer of Indian coal, the credit determined 

 under this section (without regard to this paragraph) 

 for any taxable year shall be increased by an amount 

 equal to the applicable dollar amount per ton of Indian 

 coal--

 ``(i) produced by the taxpayer at an Indian 

 coal production facility during the 7-year period 

 beginning on January 1, 2006, and

 ``(ii) sold by the taxpayer--

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 ``(I) to an unrelated person, and

 ``(II) during such 7-year period and 

 such taxable year.

 ``(B) Applicable dollar amount.--

 ``(i) In general.--The term `applicable dollar 

 amount' for any taxable year beginning in a 

 calendar year means--

[[Page 119 STAT. 989]]

 ``(I) $1.50 in the case of calendar 

 years 2006 through 2009, and

 ``(II) $2.00 in the case of calendar 

 years beginning after 2009.

 ``(ii) Inflation adjustment.--In the case of 

 any calendar year after 2006, each of the dollar 

 amounts under clause (i) shall be equal to the 

 product of such dollar amount and the inflation 

 adjustment factor determined under paragraph 

 (2)(B) for the calendar year, except that such 

 paragraph shall be applied by substituting `2005' 

 for `1992'.

 ``(C) Application of rules.--Rules similar to the 

 rules of the subsection (b)(3) and paragraphs (1), (3), 

 (4), and (5) of this subsection shall apply for purposes 

 of determining the amount of any increase under this 

 paragraph.

 ``(D) <<NOTE: Effective date.>> Treatment as 

 specified credit.--The increase in the credit determined 

 under subsection (a) by reason of this paragraph with 

 respect to any facility shall be treated as a specified 

 credit for purposes of section 38(c)(4)(A) during the 4-

 year period beginning on the later of January 1, 2006, 

 or the date on which such facility is placed in service 

 by the taxpayer.''.

 (2) <<NOTE: 26 USC 45.>> Resource.--Subsection (c) of 

 section 45 (relating to qualified energy resources and refined 

 coal), as amended by this Act, is amended by adding at the end 

 the following new paragraph:

 ``(9) Indian coal.--

 ``(A) In general.--The term `Indian coal' means coal 

 which is produced from coal reserves which, on June 14, 

 2005--

 ``(i) were owned by an Indian tribe, or

 ``(ii) were held in trust by the United States 

 for the benefit of an Indian tribe or its members.

 ``(B) Indian tribe.--For purposes of this paragraph, 

 the term `Indian tribe' has the meaning given such term 

 by section 7871(c)(3)(E)(ii).''.

 (3) Indian coal production facility.--Subsection (d) of 

 section 45, as amended by this Act, is amended by adding at the 

 end the following new paragraph:

 ``(10) Indian coal production facility.--The term `Indian 

 coal production facility' means a facility which is placed in 

 service before January 1, 2009.''.

 (4) Conforming amendment.--The heading for section 45(c) is 

 amended by striking ``Qualified Energy Resources and Refined 

 Coal'' and inserting ``Resources''.

 (e) Technical Amendment Related to Trash Combustion Facilities.--

Section 45(d)(7) (relating to trash combustion facilities) is amended by 

adding at the end the following: ``Such term shall include a new unit 

placed in service in connection with a facility placed in service on or 

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before the date of the enactment of this paragraph, but only to the 

extent of the increased amount of electricity produced at the facility 

by reason of such new unit.''.

 (f) Additional Technical Amendments Related to Section 710 of the 

American Jobs Creation Act of 2004.--

 (1) Clause (ii) of section 45(b)(4)(B) is amended by 

 striking ``the date of the enactment of this Act'' and inserting 

 ``January 1, 2005,''.

[[Page 119 STAT. 990]]

 (2) <<NOTE: 26 USC 45.>> Clause (ii) of section 45(c)(3)(A) 

 is amended by inserting ``or any nonhazardous lignin waste 

 material'' after ``cellulosic waste material''.

 (3) Subsection (e) of section 45 is amended by striking 

 paragraph (6).

 (4)(A) Paragraph (9) of section 45(e) is amended to read as 

 follows:

 ``(9) Coordination with credit for producing fuel from a 

 nonconventional source.--

 ``(A) In general.--The term `qualified facility' 

 shall not include any facility which produces 

 electricity from gas derived from the biodegradation of 

 municipal solid waste if such biodegradation occurred in 

 a facility (within the meaning of section 29) the 

 production from which is allowed as a credit under 

 section 29 for the taxable year or any prior taxable 

 year.

 ``(B) Refined coal facilities.--The term `refined 

 coal production facility' shall not include any facility 

 the production from which is allowed as a credit under 

 section 29 for the taxable year or any prior taxable 

 year.''.

 (B) Subparagraph (C) of section 45(e)(8) is amended by 

 striking ``and (9)''.

 (5) <<NOTE: 26 USC 168.>> Subclause (I) of section 

 168(e)(3)(B)(vi) is amended to read as follows:

 ``(I) is described in subparagraph 

 (A) of section 48(a)(3) (or would be so 

 described if `solar and wind' were 

 substituted for `solar' in clause (i) 

 thereof and the last sentence of such 

 section did not apply to such 

 subparagraph),''.

 (6) Paragraph (4) of section 710(g) of the American Jobs 

 Creation Act of 2004 <<NOTE: 26 USC 45 note.>> is amended by 

 striking ``January 1, 2004'' and inserting ``January 1, 2005''.

 (g) <<NOTE: 26 USC 45 note.>> Effective Dates.--

 (1) In general.--Except as provided in paragraph (2), the 

 amendments made by this section shall take effect of the date of 

 the enactment of this Act.

 (2) Technical amendments.--The amendments made by 

 subsections (e) and (f) shall take effect as if included in the 

 amendments made by section 710 of the American Jobs Creation Act 

 of 2004.

SEC. 1302. APPLICATION OF SECTION 45 CREDIT TO AGRICULTURAL 

 COOPERATIVES.

 (a) In General.--Section 45(e) (relating to definitions and special 

rules), as amended by this Act, is amended by adding at the end the 

following:

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 ``(11) Allocation of credit to patrons of agricultural 

 cooperative.--

 ``(A) Election to allocate.--

 ``(i) In general.--In the case of an eligible 

 cooperative organization, any portion of the 

 credit determined under subsection (a) for the 

 taxable year may, at the election of the 

 organization, be apportioned among patrons of the 

 organization on the basis of the amount of 

 business done by the patrons during the taxable 

 year.

[[Page 119 STAT. 991]]

 ``(ii) Form and effect of election.--An 

 election under clause (i) for any taxable year 

 shall be made on a timely filed return for such 

 year. Such election, once made, shall be 

 irrevocable for such taxable year. Such election 

 shall not take effect unless the organization 

 designates the apportionment as such in a written 

 notice mailed to its patrons during the payment 

 period described in section 1382(d).

 ``(B) Treatment of organizations and patrons.--The 

 amount of the credit apportioned to any patrons under 

 subparagraph (A)--

 ``(i) shall not be included in the amount 

 determined under subsection (a) with respect to 

 the organization for the taxable year, and

 ``(ii) shall be included in the amount 

 determined under subsection (a) for the first 

 taxable year of each patron ending on or after the 

 last day of the payment period (as defined in 

 section 1382(d)) for the taxable year of the 

 organization or, if earlier, for the taxable year 

 of each patron ending on or after the date on 

 which the patron receives notice from the 

 cooperative of the apportionment.

 ``(C) Special rules for decrease in credits for 

 taxable year.--If the amount of the credit of a 

 cooperative organization determined under subsection (a) 

 for a taxable year is less than the amount of such 

 credit shown on the return of the cooperative 

 organization for such year, an amount equal to the 

 excess of--

 ``(i) such reduction, over

 ``(ii) the amount not apportioned to such 

 patrons under subparagraph (A) for the taxable 

 year,

 shall be treated as an increase in tax imposed by this 

 chapter on the organization. Such increase shall not be 

 treated as tax imposed by this chapter for purposes of 

 determining the amount of any credit under this chapter.

 ``(D) Eligible cooperative defined.--For purposes of 

 this section the term `eligible cooperative' means a 

 cooperative organization described in section 1381(a) 

 which is owned more than 50 percent by agricultural 

 producers or by entities owned by agricultural 

 producers. For this purpose an entity owned by an 

 agricultural producer is one that is more than 50 

 percent owned by agricultural producers.''.

 (b) Conforming Amendment.--The last sentence of section 55(c)(1) 

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is <<NOTE: 26 USC 55.>> amended by inserting ``45(e)(11)(C),'' after 

``section''.

 (c) <<NOTE: 26 USC 45 note.>> Effective Date.--The amendments made 

by this section shall apply to taxable years of cooperative 

organizations ending after the date of the enactment of this Act.

SEC. 1303. CLEAN RENEWABLE ENERGY BONDS.

 (a) In General.--Part IV of subchapter A of chapter 1 (relating to 

credits against tax) is amended by adding at the end the following new 

subpart:

[[Page 119 STAT. 992]]

 ``Subpart H--Nonrefundable Credit to Holders of Certain Bonds

``Sec. 54. Credit to holders of clean renewable energy bonds.

``SEC. 54. CREDIT TO HOLDERS OF CLEAN RENEWABLE ENERGY BONDS.

 ``(a) Allowance of Credit.--If a taxpayer holds a clean renewable 

energy bond on one or more credit allowance dates of the bond occurring 

during any taxable year, there shall be allowed as a credit against the 

tax imposed by this chapter for the taxable year an amount equal to the 

sum of the credits determined under subsection (b) with respect to such 

dates.

 ``(b) Amount of Credit.--

 ``(1) In general.--The amount of the credit determined under 

 this subsection with respect to any credit allowance date for a 

 clean renewable energy bond is 25 percent of the annual credit 

 determined with respect to such bond.

 ``(2) Annual credit.--The annual credit determined with 

 respect to any clean renewable energy bond is the product of--

 ``(A) the credit rate determined by the Secretary 

 under paragraph (3) for the day on which such bond was 

 sold, multiplied by

 ``(B) the outstanding face amount of the bond.

 ``(3) Determination.--For purposes of paragraph (2), with 

 respect to any clean renewable energy bond, the Secretary shall 

 determine daily or cause to be determined daily a credit rate 

 which shall apply to the first day on which there is a binding, 

 written contract for the sale or exchange of the bond. The 

 credit rate for any day is the credit rate which the Secretary 

 or the Secretary's designee estimates will permit the issuance 

 of clean renewable energy bonds with a specified maturity or 

 redemption date without discount and without interest cost to 

 the qualified issuer.

 ``(4) Credit allowance date.--For purposes of this section, 

 the term `credit allowance date' means--

 ``(A) March 15,

 ``(B) June 15,

 ``(C) September 15, and

 ``(D) December 15.

 Such term also includes the last day on which the bond is 

 outstanding.

 ``(5) Special rule for issuance and redemption.--In the case 

 of a bond which is issued during the 3-month period ending on a 

 credit allowance date, the amount of the credit determined under 

 this subsection with respect to such credit allowance date shall 

 be a ratable portion of the credit otherwise determined based on 

 the portion of the 3-month period during which the bond is 

 outstanding. A similar rule shall apply when the bond is 

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 redeemed or matures.

 ``(c) Limitation Based on Amount of Tax.--The credit allowed under 

subsection (a) for any taxable year shall not exceed the excess of--

 ``(1) the sum of the regular tax liability (as defined in 

 section 26(b)) plus the tax imposed by section 55, over

[[Page 119 STAT. 993]]

 ``(2) the sum of the credits allowable under this part 

 (other than subpart C and this section).

 ``(d) Clean Renewable Energy Bond.--For purposes of this section--

 ``(1) In general.--The term `clean renewable energy bond' 

 means any bond issued as part of an issue if--

 ``(A) the bond is issued by a qualified issuer 

 pursuant to an allocation by the Secretary to such 

 issuer of a portion of the national clean renewable 

 energy bond limitation under subsection (f)(2),

 ``(B) 95 percent or more of the proceeds of such 

 issue are to be used for capital expenditures incurred 

 by qualified borrowers for one or more qualified 

 projects,

 ``(C) the qualified issuer designates such bond for 

 purposes of this section and the bond is in registered 

 form, and

 ``(D) the issue meets the requirements of subsection 

 (h).

 ``(2) Qualified project; special use rules.--

 ``(A) In general.--The term `qualified project' 

 means any qualified facility (as determined under 

 section 45(d) without regard to paragraph (10) and to 

 any placed in service date) owned by a qualified 

 borrower.

 ``(B) Refinancing rules.--For purposes of paragraph 

 (1)(B), a qualified project may be refinanced with 

 proceeds of a clean renewable energy bond only if the 

 indebtedness being refinanced (including any obligation 

 directly or indirectly refinanced by such indebtedness) 

 was originally incurred by a qualified borrower after 

 the date of the enactment of this section.

 ``(C) <<NOTE: Deadlines.>> Reimbursement.--For 

 purposes of paragraph (1)(B), a clean renewable energy 

 bond may be issued to reimburse a qualified borrower for 

 amounts paid after the date of the enactment of this 

 section with respect to a qualified project, but only 

 if--

 ``(i) prior to the payment of the original 

 expenditure, the qualified borrower declared its 

 intent to reimburse such expenditure with the 

 proceeds of a clean renewable energy bond,

 ``(ii) not later than 60 days after payment of 

 the original expenditure, the qualified issuer 

 adopts an official intent to reimburse the 

 original expenditure with such proceeds, and

 ``(iii) the reimbursement is made not later 

 than 18 months after the date the original 

 expenditure is paid.

 ``(D) Treatment of changes in use.--For purposes of 

 paragraph (1)(B), the proceeds of an issue shall not be 

 treated as used for a qualified project to the extent 

 that a qualified borrower or qualified issuer takes any 

 action within its control which causes such proceeds not 

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 to be used for a qualified project. The Secretary shall 

 prescribe regulations specifying remedial actions that 

 may be taken (including conditions to taking such 

 remedial actions) to prevent an action described in the 

 preceding sentence from causing a bond to fail to be a 

 clean renewable energy bond.

[[Page 119 STAT. 994]]

 ``(e) Maturity Limitations.--

 ``(1) Duration of term.--A bond shall not be treated as a 

 clean renewable energy bond if the maturity of such bond exceeds 

 the maximum term determined by the Secretary under paragraph (2) 

 with respect to such bond.

 ``(2) Maximum term.--During each calendar month, the 

 Secretary shall determine the maximum term permitted under this 

 paragraph for bonds issued during the following calendar month. 

 Such maximum term shall be the term which the Secretary 

 estimates will result in the present value of the obligation to 

 repay the principal on the bond being equal to 50 percent of the 

 face amount of such bond. Such present value shall be determined 

 without regard to the requirements of subsection (l)(6) and 

 using as a discount rate the average annual interest rate of 

 tax-exempt obligations having a term of 10 years or more which 

 are issued during the month. If the term as so determined is not 

 a multiple of a whole year, such term shall be rounded to the 

 next highest whole year.

 ``(f) Limitation on Amount of Bonds Designated.--

 ``(1) National limitation.--There is a national clean 

 renewable energy bond limitation of $800,000,000.

 ``(2) Allocation by secretary.--The Secretary shall allocate 

 the amount described in paragraph (1) among qualified projects 

 in such manner as the Secretary determines appropriate, except 

 that the Secretary may not allocate more than $500,000,000 of 

 the national clean renewable energy bond limitation to finance 

 qualified projects of qualified borrowers which are governmental 

 bodies.

 ``(g) Credit Included in Gross Income.--Gross income includes the 

amount of the credit allowed to the taxpayer under this section 

(determined without regard to subsection (c)) and the amount so included 

shall be treated as interest income.

 ``(h) Special Rules Relating to Expenditures.--

 ``(1) In general.--An issue shall be treated as meeting the 

 requirements of this subsection if, as of the date of issuance, 

 the qualified issuer reasonably expects--

 ``(A) at least 95 percent of the proceeds of such 

 issue are to be spent for one or more qualified projects 

 within the 5-year period beginning on the date of 

 issuance of the clean energy bond,

 ``(B) a binding commitment with a third party to 

 spend at least 10 percent of the proceeds of such issue 

 will be incurred within the 6-month period beginning on 

 the date of issuance of the clean energy bond or, in the 

 case of a clean energy bond the proceeds of which are to 

 be loaned to two or more qualified borrowers, such 

 binding commitment will be incurred within the 6-month 

 period beginning on the date of the loan of such 

 proceeds to a qualified borrower, and

 ``(C) such projects will be completed with due 

 diligence and the proceeds of such issue will be spent 

 with due diligence.

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 ``(2) Extension of period.--Upon submission of a request 

 prior to the expiration of the period described in paragraph 

 (1)(A), the Secretary may extend such period if the qualified

[[Page 119 STAT. 995]]

 issuer establishes that the failure to satisfy the 5-year 

 requirement is due to reasonable cause and the related projects 

 will continue to proceed with due diligence.

 ``(3) Failure to spend required amount of bond proceeds 

 within 5 years.--To the extent that less than 95 percent of the 

 proceeds of such issue are expended by the close of the 5-year 

 period beginning on the date of issuance (or if an extension has 

 been obtained under paragraph (2), by the close of the extended 

 period), the qualified issuer shall redeem all of the 

 nonqualified bonds within 90 days after the end of such period. 

 For purposes of this paragraph, the amount of the nonqualified 

 bonds required to be redeemed shall be determined in the same 

 manner as under section 142.

 ``(i) Special Rules Relating to Arbitrage.--A bond which is part of 

an issue shall not be treated as a clean renewable energy bond unless, 

with respect to the issue of which the bond is a part, the qualified 

issuer satisfies the arbitrage requirements of section 148 with respect 

to proceeds of the issue.

 ``(j) Cooperative Electric Company; Qualified Energy Tax Credit Bond 

Lender; Governmental Body; Qualified Borrower.--For purposes of this 

section--

 ``(1) Cooperative electric company.--The term `cooperative 

 electric company' means a mutual or cooperative electric company 

 described in section 501(c)(12) or section 1381(a)(2)(C), or a 

 not-for-profit electric utility which has received a loan or 

 loan guarantee under the Rural Electrification Act.

 ``(2) Clean renewable energy bond lender.--The term `clean 

 renewable energy bond lender' means a lender which is a 

 cooperative which is owned by, or has outstanding loans to, 100 

 or more cooperative electric companies and is in existence on 

 February 1, 2002, and shall include any affiliated entity which 

 is controlled by such lender.

 ``(3) Governmental body.--The term `governmental body' means 

 any State, territory, possession of the United States, the 

 District of Columbia, Indian tribal government, and any 

 political subdivision thereof.

 ``(4) Qualified issuer.--The term `qualified issuer' means--

 ``(A) a clean renewable energy bond lender,

 ``(B) a cooperative electric company, or

 ``(C) a governmental body.

 ``(5) Qualified borrower.--The term `qualified borrower' 

 means--

 ``(A) a mutual or cooperative electric company 

 described in section 501(c)(12) or 1381(a)(2)(C), or

 ``(B) a governmental body.

 ``(k) Special Rules Relating to Pool Bonds.--No portion of a pooled 

financing bond may be allocable to any loan unless the borrower has 

entered into a written loan commitment for such portion prior to the 

issue date of such issue.

 ``(l) Other Definitions and Special Rules.--For purposes of this 

section--

 ``(1) Bond.--The term `bond' includes any obligation.

 ``(2) Pooled financing bond.--The term `pooled financing 

 bond' shall have the meaning given such term by section 

 149(f)(4)(A).

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[[Page 119 STAT. 996]]

 ``(3) Partnership; s <<NOTE: Applicability.>> corporation; 

 and other pass-thru entities.--

 ``(A) In general.--

 Under <<NOTE: Regulations.>> regulations prescribed by 

 the Secretary, in the case of a partnership, trust, S 

 corporation, or other pass-thru entity, rules similar to 

 the rules of section 41(g) shall apply with respect to 

 the credit allowable under subsection (a).

 ``(B) No basis adjustment.--In the case of a bond 

 held by a partnership or an S corporation, rules similar 

 to the rules under section 1397E(i) shall apply.

 ``(4) Bonds <<NOTE: Procedures.>> held by regulated 

 investment companies.--If any clean renewable energy bond is 

 held by a regulated investment company, the credit determined 

 under subsection (a) shall be allowed to shareholders of such 

 company under procedures prescribed by the Secretary.

 ``(5) Treatment for estimated tax purposes.--Solely for 

 purposes of sections 6654 and 6655, the credit allowed by this 

 section (determined without regard to subsection (c)) to a 

 taxpayer by reason of holding a clean renewable energy bond on a 

 credit allowance date shall be treated as if it were a payment 

 of estimated tax made by the taxpayer on such date.

 ``(6) Ratable principal amortization required.--A bond shall 

 not be treated as a clean renewable energy bond unless it is 

 part of an issue which provides for an equal amount of principal 

 to be paid by the qualified issuer during each calendar year 

 that the issue is outstanding.

 ``(7) Reporting.--Issuers of clean renewable energy bonds 

 shall submit reports similar to the reports required under 

 section 149(e).

 ``(m) Termination.--This section shall not apply with respect to any 

bond issued after December 31, 2007.''.

 (b) Reporting.--Subsection (d) of section 6049 (relating to returns 

regarding payments of interest) is amended by adding at the end the 

following new paragraph:

 ``(8) Reporting of credit on clean renewable energy bonds.--

 ``(A) In general.--For purposes of subsection (a), 

 the term `interest' includes amounts includible in gross 

 income under section 54(g) and such amounts shall be 

 treated as paid on the credit allowance date (as defined 

 in section 54(b)(4)).

 ``(B) Reporting to corporations, etc.--Except as 

 otherwise provided in regulations, in the case of any 

 interest described in subparagraph (A), subsection 

 (b)(4) shall be applied without regard to subparagraphs 

 (A), (H), (I), (J), (K), and (L)(i) of such subsection.

 ``(C) Regulatory authority.--The Secretary may 

 prescribe such regulations as are necessary or 

 appropriate to carry out the purposes of this paragraph, 

 including regulations which require more frequent or 

 more detailed reporting.''.

 (c) Conforming Amendments.--

 (1) The table of subparts for part IV of subchapter A of 

 chapter 1 is amended by adding at the end the following new 

 item:

[[Page 119 STAT. 997]]

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 ``subpart h. nonrefundable credit to holders of certain bonds.''.

 (2) Section 1397E(c)(2) is amended by inserting ``, and 

 subpart H thereof'' after ``refundable credits''.

 (3) Subsection (h) of section 1397E is amended to read as 

 follows:

 ``(h) Credit Treated as Nonrefundable Bondholder Credit.--For 

purposes of this title, the credit allowed by this section shall be 

treated as a credit allowable under subpart H of part IV of subchapter A 

of this chapter.''.

 (4) Section 6401(b)(1) is amended by striking ``and G'' and 

 inserting ``G, and H''.

 (d) Issuance of Regulations.--The <<NOTE: Deadline. 26 USC 54 

note.>> Secretary of the Treasury shall issue regulations required under 

section 54 of the Internal Revenue Code of 1986 (as added by this 

section) not later than 120 days after the date of the enactment of this 

Act.

 (e) Effective Date.--The <<NOTE: 26 USC 54 note.>> amendments made 

by this section shall apply to bonds issued after December 31, 2005.

SEC. 1304. TREATMENT OF INCOME OF CERTAIN ELECTRIC COOPERATIVES.

 (a) Elimination of Sunset on Treatment of Income From Open Access 

and Nuclear Decommissioning Transactions.--Section 501(c)(12)(C) is 

amended by striking the last sentence.

 (b) Elimination of Sunset on Treatment of Income From Load Loss 

Transactions.--Section 501(c)(12)(H) is amended by striking clause (x).

 (c) Effective Date.--The <<NOTE: 26 USC 501 note.>> amendments made 

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

Act.

SEC. 1305. DISPOSITIONS OF TRANSMISSION PROPERTY TO IMPLEMENT FERC 

 RESTRUCTURING POLICY.

 (a) In General.--Section 451(i)(3) (defining qualifying electric 

transmission transaction) is amended by striking ``2007'' and inserting 

``2008''.

 (b) Technical Amendment Related to Section 909 of the American Jobs 

Creation Act of 2004.--Clause (ii) of section 451(i)(4)(B) is amended by 

striking ``the close of the period applicable under subsection (a)(2)(B) 

as extended under paragraph (2)'' and inserting ``December 31, 2007''.

 (c) Effective <<NOTE: 26 USC 451 note.>> Dates.--

 (1) In general.--The amendment made by subsection (a) shall 

 apply to transactions occurring after the date of the enactment 

 of this Act.

 (2) Technical amendment.--The amendment made by subsection 

 (b) shall take effect as if included in the amendments made by 

 section 909 of the American Jobs Creation Act of 2004.

SEC. 1306. CREDIT FOR PRODUCTION FROM ADVANCED NUCLEAR POWER FACILITIES.

 (a) In General.--Subpart D of part IV of subchapter A of chapter 1 

(relating to business related credits) is amended by adding after 

section 45I the following new section:

[[Page 119 STAT. 998]]

``SEC. 45J. CREDIT FOR PRODUCTION FROM ADVANCED NUCLEAR POWER 

 FACILITIES.

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 ``(a) General Rule.--For purposes of section 38, the advanced 

nuclear power facility production credit of any taxpayer for any taxable 

year is equal to the product of--

 ``(1) 1.8 cents, multiplied by

 ``(2) the kilowatt hours of electricity--

 ``(A) produced by the taxpayer at an advanced 

 nuclear power facility during the 8-year period 

 beginning on the date the facility was originally placed 

 in service, and

 ``(B) sold by the taxpayer to an unrelated person 

 during the taxable year.

 ``(b) National Limitation.--

 ``(1) In general.--The amount of credit which would (but for 

 this subsection and subsection (c)) be allowed with respect to 

 any facility for any taxable year shall not exceed the amount 

 which bears the same ratio to such amount of credit as--

 ``(A) the national megawatt capacity limitation 

 allocated to the facility, bears to

 ``(B) the total megawatt nameplate capacity of such 

 facility.

 ``(2) Amount of national limitation.--The national megawatt 

 capacity limitation shall be 6,000 megawatts.

 ``(3) Allocation of limitation.--The Secretary shall 

 allocate the national megawatt capacity limitation in such 

 manner as the Secretary may prescribe.

 ``(4) Regulations.--Not <<NOTE: Deadline.>> later than 6 

 months after the date of the enactment of this section, the 

 Secretary shall prescribe such regulations as may be necessary 

 or appropriate to carry out the purposes of this subsection. 

 Such regulations shall provide a certification process under 

 which the Secretary, after consultation with the Secretary of 

 Energy, shall approve and allocate the national megawatt 

 capacity limitation.

 ``(c) Other Limitations.--

 ``(1) Annual limitation.--The amount of the credit allowable 

 under subsection (a) (after the application of subsection (b)) 

 for any taxable year with respect to any facility shall not 

 exceed an amount which bears the same ratio to $125,000,000 as--

 ``(A) the national megawatt capacity limitation 

 allocated under subsection (b) to the facility, bears to

 ``(B) 1,000.

 ``(2) Other limitations.--Rules similar to the rules of 

 section 45(b)(1) shall apply for purposes of this section.

 ``(d) Advanced Nuclear Power Facility.--For purposes of this 

section--

 ``(1) In general.--The term `advanced nuclear power 

 facility' means any advanced nuclear facility--

 ``(A) which is owned by the taxpayer and which uses 

 nuclear energy to produce electricity, and

 ``(B) which is placed in service after the date of 

 the enactment of this paragraph and before January 1, 

 2021.

 ``(2) Advanced nuclear facility.--For purposes of paragraph 

 (1), the term `advanced nuclear facility' means any nuclear 

 facility the reactor design for which is approved after December 

 31, 1993, by the Nuclear Regulatory Commission

[[Page 119 STAT. 999]]

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 (and such design or a substantially similar design of comparable 

 capacity was not approved on or before such date).

 ``(e) Other Rules To Apply.--Rules similar to the rules of 

paragraphs (1), (2), (3), (4), and (5) of section 45(e) shall apply for 

purposes of this section.''.

 (b) Credit Treated as Business Credit.--Section 38(b), as amended by 

the Transportation Equity Act: A Legacy for Users, is amended by 

striking ``plus'' at the end of paragraph (19), by striking the period 

at the end of paragraph (20) and inserting ``, plus'', and by adding at 

the end the following:

 ``(21) the advanced nuclear power facility production credit 

 determined under section 45J(a).''.

 (c) Clerical Amendment.--The table of sections for subpart D of part 

IV of subchapter A of chapter 1 is amended by adding at the end the 

following:

``Sec. 45J. Credit for production from advanced nuclear power 

 facilities.''.

 (d) Effective Date.--The <<NOTE: 26 USC 38 note.>> amendments made 

by this section shall apply to production in taxable years beginning 

after the date of the enactment of this Act.

SEC. 1307. CREDIT FOR INVESTMENT IN CLEAN COAL FACILITIES.

 (a) In General.--Section 46 (relating to amount of credit) is 

amended by striking ``and'' at the end of paragraph (1), by striking the 

period at the end of paragraph (2), and by adding at the end the 

following new paragraphs:

 ``(3) the qualifying advanced coal project credit, and

 ``(4) the qualifying gasification project credit.''.

 (b) Amount of Credits.--Subpart E of part IV of subchapter A of 

chapter 1 (relating to rules for computing investment credit) is amended 

by inserting after section 48 the following new sections:

``SEC. 48A. QUALIFYING ADVANCED COAL PROJECT CREDIT.

 ``(a) In General.--For purposes of section 46, the qualifying 

advanced coal project credit for any taxable year is an amount equal 

to--

 ``(1) 20 percent of the qualified investment for such 

 taxable year in the case of projects described in subsection 

 (d)(3)(B)(i), and

 ``(2) 15 percent of the qualified investment for such 

 taxable year in the case of projects described in subsection 

 (d)(3)(B)(ii).

 ``(b) Qualified Investment.--

 ``(1) In general.--For purposes of subsection (a), the 

 qualified investment for any taxable year is the basis of 

 eligible property placed in service by the taxpayer during such 

 taxable year which is part of a qualifying advanced coal 

 project--

 ``(A)(i) the construction, reconstruction, or 

 erection of which is completed by the taxpayer, or

 ``(ii) which is acquired by the taxpayer if the 

 original use of such property commences with the 

 taxpayer, and

 ``(B) with respect to which depreciation (or 

 amortization in lieu of depreciation) is allowable.

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 ``(2) Special rule for certain subsidized property.--Rules 

 similar to section 48(a)(4) shall apply for purposes of this 

 section.

 ``(3) Certain qualified progress expenditures rules made 

 applicable.--Rules similar to the rules of subsections (c)(4) 

 and (d) of section 46 (as in effect on the day before

[[Page 119 STAT. 1000]]

 the enactment of the Revenue Reconciliation Act of 1990) shall 

 apply for purposes of this section.

 ``(c) Definitions.--For purposes of this section--

 ``(1) Qualifying advanced coal project.--The term 

 `qualifying advanced coal project' means a project which meets 

 the requirements of subsection (e).

 ``(2) Advanced coal-based generation technology.--The term 

 `advanced coal-based generation technology' means a technology 

 which meets the requirements of subsection (f).

 ``(3) Eligible property.--The term `eligible property' 

 means--

 ``(A) in the case of any qualifying advanced coal 

 project using an integrated gasification combined cycle, 

 any property which is a part of such project and is 

 necessary for the gasification of coal, including any 

 coal handling and gas separation equipment, and

 ``(B) in the case of any other qualifying advanced 

 coal project, any property which is a part of such 

 project.

 ``(4) Coal.--The term `coal' means anthracite, bituminous 

 coal, subbituminous coal, lignite, and peat.

 ``(5) Greenhouse gas capture capability.--The term 

 `greenhouse gas capture capability' means an integrated 

 gasification combined cycle technology facility capable of 

 adding components which can capture, separate on a long-term 

 basis, isolate, remove, and sequester greenhouse gases which 

 result from the generation of electricity.

 ``(6) Electric generation unit.--The term `electric 

 generation unit' means any facility at least 50 percent of the 

 total annual net output of which is electrical power, including 

 an otherwise eligible facility which is used in an industrial 

 application.

 ``(7) Integrated gasification combined cycle.--The term 

 `integrated gasification combined cycle' means an electric 

 generation unit which produces electricity by converting coal to 

 synthesis gas which is used to fuel a combined-cycle plant which 

 produces electricity from both a combustion turbine (including a 

 combustion turbine/fuel cell hybrid) and a steam turbine.

 ``(d) Qualifying <<NOTE: Deadlines.>> Advanced Coal Project 

Program.--

 ``(1) Establishment.--Not later than 180 days after the date 

 of enactment of this section, the Secretary, in consultation 

 with the Secretary of Energy, shall establish a qualifying 

 advanced coal project program for the deployment of advanced 

 coal-based generation technologies.

 ``(2) Certification.--

 ``(A) Application period.--Each applicant for 

 certification under this paragraph shall submit an 

 application meeting the requirements of subparagraph 

 (B). An applicant may only submit an application during 

 the 3-year period beginning on the date the Secretary 

 establishes the program under paragraph (1).

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 ``(B) Requirements for applications for 

 certification.--An application under subparagraph (A) 

 shall contain such information as the Secretary may 

 require in order to make a determination to accept or 

 reject an application for certification as meeting the 

 requirements under subsection (e)(1). <<NOTE: Trade 

 secrets. Confidential information.>> Any information 

 contained in the

[[Page 119 STAT. 1001]]

 application shall be protected as provided in section 

 552(b)(4) of title 5, United States Code.

 ``(C) Time to act upon applications for 

 certification.--The Secretary shall issue a 

 determination as to whether an applicant has met the 

 requirements under subsection (e)(1) within 60 days 

 following the date of submittal of the application for 

 certification.

 ``(D) Time to meet criteria for certification.--Each 

 applicant for certification shall have 2 years from the 

 date of acceptance by the Secretary of the application 

 during which to provide to the Secretary evidence that 

 the criteria set forth in subsection (e)(2) have been 

 met.

 ``(E) Period of issuance.--An applicant which 

 receives a certification shall have 5 years from the 

 date of issuance of the certification in order to place 

 the project in service and if such project is not placed 

 in service by that time period then the certification 

 shall no longer be valid.

 ``(3) Aggregate credits.--

 ``(A) In general.--The aggregate credits allowed 

 under subsection (a) for projects certified by the 

 Secretary under paragraph (2) may not exceed 

 $1,300,000,000.

 ``(B) Particular projects.--Of the dollar amount in 

 subparagraph (A), the Secretary is authorized to 

 certify--

 ``(i) $800,000,000 for integrated gasification 

 combined cycle projects, and

 ``(ii) $500,000,000 for projects which use 

 other advanced coal-based generation technologies.

 ``(4) Review and redistribution.--

 ``(A) Review.--Not later than 6 years after the date 

 of enactment of this section, the Secretary shall review 

 the credits allocated under this section as of the date 

 which is 6 years after the date of enactment of this 

 section.

 ``(B) Redistribution.--The Secretary may reallocate 

 credits available under clauses (i) and (ii) of 

 paragraph (3)(B) if the Secretary determines that--

 ``(i) there is an insufficient quantity of 

 qualifying applications for certification pending 

 at the time of the review, or

 ``(ii) any certification made pursuant to 

 subsection paragraph (2) has been revoked pursuant 

 to subsection paragraph (2)(D) because the project 

 subject to the certification has been delayed as a 

 result of third party opposition or litigation to 

 the proposed project.

 ``(C) Reallocation.--If the Secretary determines 

 that credits under clause (i) or (ii) of paragraph 

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 (3)(B) are available for reallocation pursuant to the 

 requirements set forth in paragraph (2), the Secretary 

 is authorized to conduct an additional program for 

 applications for certification.

 ``(e) Qualifying Advanced Coal Projects.--

 ``(1) Requirements.--For purposes of subsection (c)(1), a 

 project shall be considered a qualifying advanced coal project 

 that the Secretary may certify under subsection (d)(2) if the 

 Secretary determines that, at a minimum--

 ``(A) the project uses an advanced coal-based 

 generation technology--

 ``(i) to power a new electric generation unit; 

 or

[[Page 119 STAT. 1002]]

 ``(ii) to retrofit or repower an existing 

 electric generation unit (including an existing 

 natural gas-fired combined cycle unit);

 ``(B) the fuel input for the project, when 

 completed, is at least 75 percent coal;

 ``(C) the project, consisting of one or more 

 electric generation units at one site, will have a total 

 nameplate generating capacity of at least 400 megawatts;

 ``(D) the applicant provides evidence that a 

 majority of the output of the project is reasonably 

 expected to be acquired or utilized;

 ``(E) the applicant provides evidence of ownership 

 or control of a site of sufficient size to allow the 

 proposed project to be constructed and to operate on a 

 long-term basis; and

 ``(F) the project will be located in the United 

 States.

 ``(2) Requirements for certification.--For the purpose of 

 subsection (d)(2)(D), a project shall be eligible for 

 certification only if the Secretary determines that--

 ``(A) the applicant for certification has received 

 all Federal and State environmental authorizations or 

 reviews necessary to commence construction of the 

 project; and

 ``(B) the applicant for certification, except in the 

 case of a retrofit or repower of an existing electric 

 generation unit, has purchased or entered into a binding 

 contract for the purchase of the main steam turbine or 

 turbines for the project, except that such contract may 

 be contingent upon receipt of a certification under 

 subsection (d)(2).

 ``(3) Priority for integrated gasification combined cycle 

 projects.--In determining which qualifying advanced coal 

 projects to certify under subsection (d)(2), the Secretary 

 shall--

 ``(A) certify capacity, in accordance with the 

 procedures set forth in subsection (d), in relatively 

 equal amounts to--

 ``(i) projects using bituminous coal as a 

 primary feedstock,

 ``(ii) projects using subbituminous coal as a 

 primary feedstock, and

 ``(iii) projects using lignite as a primary 

 feedstock, and

 ``(B) give high priority to projects which include, 

 as determined by the Secretary--

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 ``(i) greenhouse gas capture capability,

 ``(ii) increased by-product utilization, and

 ``(iii) other benefits.

 ``(f) Advanced Coal-Based Generation Technology.--

 ``(1) In general.--For the purpose of this section, an 

 electric generation unit uses advanced coal-based generation 

 technology if--

 ``(A) the unit--

 ``(i) uses integrated gasification combined 

 cycle technology, or

 ``(ii) except as provided in paragraph (3), 

 has a design net heat rate of 8530 Btu/kWh (40 

 percent efficiency), and

[[Page 119 STAT. 1003]]

 ``(B) the unit is designed to meet the performance 

 requirements in the following table:

Performance characteristic: Design level for project:

 SO2 (percent removal)........... 99 percent

 NOx (emissions)................. 0.07 lbs/MMBTU

 PM* (emissions)................. 0.015 lbs/MMBTU

 Hg (percent removal)............ 90 percent

 ``(2) Design net heat rate.--For purposes of this 

 subsection, design net heat rate with respect to an electric 

 generation unit shall--

 ``(A) be measured in Btu per kilowatt hour (higher 

 heating value),

 ``(B) be based on the design annual heat input to 

 the unit and the rated net electrical power, fuels, and 

 chemicals output of the unit (determined without regard 

 to the cogeneration of steam by the unit),

 ``(C) be adjusted for the heat content of the design 

 coal to be used by the unit--

 ``(i) if the heat content is less than 13,500 

 Btu per pound, but greater than 7,000 Btu per 

 pound, according to the following formula: design 

 net heat rate = unit net heat rate x [1-[((13,500-

 design coal heat content, Btu per pound)/1,000)* 

 0.013]], and

 ``(ii) if the heat content is less than or 

 equal to 7,000 Btu per pound, according to the 

 following formula: design net heat rate = unit net 

 heat rate x [1-[((13,500-design coal heat content, 

 Btu per pound)/1,000)* 0.018]], and

 ``(D) be corrected for the site reference conditions 

 of--

 ``(i) elevation above sea level of 500 feet,

 ``(ii) air pressure of 14.4 pounds per square 

 inch absolute,

 ``(iii) temperature, dry bulb of 63F,

 ``(iv) temperature, wet bulb of 54F, and

 ``(v) relative humidity of 55 percent.

 ``(3) Existing units.--In the case of any electric 

 generation unit in existence on the date of the enactment of 

 this section, such unit uses advanced coal-based generation 

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 technology if, in lieu of the requirements under paragraph 

 (1)(A)(ii), such unit achieves a minimum efficiency of 35 

 percent and an overall thermal design efficiency improvement, 

 compared to the efficiency of the unit as operated, of not less 

 than--

 ``(A) 7 percentage points for coal of more than 

 9,000 Btu,

 ``(B) 6 percentage points for coal of 7,000 to 9,000 

 Btu, or

 ``(C) 4 percentage points for coal of less than 

 7,000 Btu.

 ``(g) Applicability.--No use of technology (or level of emission 

reduction solely by reason of the use of the technology), and no 

achievement of any emission reduction by the demonstration of any 

technology or performance level, by or at one or more facilities with 

respect to which a credit is allowed under this section, shall

[[Page 119 STAT. 1004]]

be considered to indicate that the technology or performance level is--

 ``(1) adequately demonstrated for purposes of section 111 of 

 the Clean Air Act (42 U.S.C. 7411);

 ``(2) achievable for purposes of section 169 of that Act (42 

 U.S.C. 7479); or

 ``(3) achievable in practice for purposes of section 171 of 

 such Act (42 U.S.C. 7501).

``SEC. 48B. QUALIFYING GASIFICATION PROJECT CREDIT.

 ``(a) In General.--For purposes of section 46, the qualifying 

gasification project credit for any taxable year is an amount equal to 

20 percent of the qualified investment for such taxable year.

 ``(b) Qualified Investment.--

 ``(1) In general.--For purposes of subsection (a), the 

 qualified investment for any taxable year is the basis of 

 eligible property placed in service by the taxpayer during such 

 taxable year which is part of a qualifying gasification 

 project--

 ``(A)(i) the construction, reconstruction, or 

 erection of which is completed by the taxpayer, or

 ``(ii) which is acquired by the taxpayer if the 

 original use of such property commences with the 

 taxpayer, and

 ``(B) with respect to which depreciation (or 

 amortization in lieu of depreciation) is allowable.

 ``(2) Special rule for certain subsidized property.--Rules 

 similar to section 48(a)(4) shall apply for purposes of this 

 section.

 ``(3) Certain qualified progress expenditures rules made 

 applicable.--Rules similar to the rules of subsections (c)(4) 

 and (d) of section 46 (as in effect on the day before the 

 enactment of the Revenue Reconciliation Act of 1990) shall apply 

 for purposes of this section.

 ``(c) Definitions.--For purposes of this section--

 ``(1) Qualifying gasification project.--The term `qualifying 

 gasification project' means any project which--

 ``(A) employs gasification technology,

 ``(B) will be carried out by an eligible entity, and

 ``(C) any portion of the qualified investment of 

 which is certified under the qualifying gasification 

 program as eligible for credit under this section in an 

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 amount (not to exceed $650,000,000) determined by the 

 Secretary.

 ``(2) Gasification technology.--The term `gasification 

 technology' means any process which converts a solid or liquid 

 product from coal, petroleum residue, biomass, or other 

 materials which are recovered for their energy or feedstock 

 value into a synthesis gas composed primarily of carbon monoxide 

 and hydrogen for direct use or subsequent chemical or physical 

 conversion.

 ``(3) Eligible property.--The term `eligible property' means 

 any property which is a part of a qualifying gasification 

 project and is necessary for the gasification technology of such 

 project.

 ``(4) Biomass.--

 ``(A) In general.--The term `biomass' means any--

 ``(i) agricultural or plant waste,

 ``(ii) byproduct of wood or paper mill 

 operations, including lignin in spent pulping 

 liquors, and

[[Page 119 STAT. 1005]]

 ``(iii) other products of forestry 

 maintenance.

 ``(B) Exclusion.--The term `biomass' does not 

 include paper which is commonly recycled.

 ``(5) Carbon capture capability.--The term `carbon capture 

 capability' means a gasification plant design which is 

 determined by the Secretary to reflect reasonable consideration 

 for, and be capable of, accommodating the equipment likely to be 

 necessary to capture carbon dioxide from the gaseous stream, for 

 later use or sequestration, which would otherwise be emitted in 

 the flue gas from a project which uses a nonrenewable fuel.

 ``(6) Coal.--The term `coal' means anthracite, bituminous 

 coal, subbituminous coal, lignite, and peat.

 ``(7) Eligible entity.--The term `eligible entity' means any 

 person whose application for certification is principally 

 intended for use in a domestic project which employs domestic 

 gasification applications related to--

 ``(A) chemicals,

 ``(B) fertilizers,

 ``(C) glass,

 ``(D) steel,

 ``(E) petroleum residues,

 ``(F) forest products, and

 ``(G) agriculture, including feedlots and dairy 

 operations.

 ``(8) Petroleum residue.--The term `petroleum residue' means 

 the carbonized product of high-boiling hydrocarbon fractions 

 obtained in petroleum processing.

 ``(d) Qualifying Gasification Project Program.--

 ``(1) In general.--Not <<NOTE: Deadline.>> later than 180 

 days after the date of the enactment of this section, the 

 Secretary, in consultation with the Secretary of Energy, shall 

 establish a qualifying gasification project program to consider 

 and award certifications for qualified investment eligible for 

 credits under this section to qualifying gasification project 

 sponsors under this section. The total amounts of credit that 

 may be allocated under the program shall not exceed $350,000,000 

 under rules similar to the rules of section 48A(d)(4).

 ``(2) Period of issuance.--A <<NOTE: Deadline.>> certificate 

 of eligibility under paragraph (1) may be issued only during the 

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 10-fiscal year period beginning on October 1, 2005.

 ``(3) Selection criteria.--The Secretary shall not make a 

 competitive certification award for qualified investment for 

 credit eligibility under this section unless the recipient has 

 documented to the satisfaction of the Secretary that--

 ``(A) the award recipient is financially viable 

 without the receipt of additional Federal funding 

 associated with the proposed project,

 ``(B) the recipient will provide sufficient 

 information to the Secretary for the Secretary to ensure 

 that the qualified investment is spent efficiently and 

 effectively,

 ``(C) a market exists for the products of the 

 proposed project as evidenced by contracts or written 

 statements of intent from potential customers,

 ``(D) the fuels identified with respect to the 

 gasification technology for such project will comprise 

 at least 90 percent of the fuels required by the project 

 for the production

[[Page 119 STAT. 1006]]

 of chemical feedstocks, liquid transportation fuels, or 

 coproduction of electricity,

 ``(E) the award recipient's project team is 

 competent in the construction and operation of the 

 gasification technology proposed, with preference given 

 to those recipients with experience which demonstrates 

 successful and reliable operations of the technology on 

 domestic fuels so identified, and

 ``(F) the award recipient has met other criteria 

 established and published by the Secretary.

 ``(e) Denial of Double Benefit.--A credit shall not be allowed under 

this section for any qualified investment for which a credit is allowed 

under section 48A.''.

 (c) Conforming Amendments.--

 (1) Section 49(a)(1)(C) is amended by striking ``and'' at 

 the end of clause (ii), by striking clause (iii), and by adding 

 after clause (ii) the following new clauses:

 ``(iii) the basis of any property which is 

 part of a qualifying advanced coal project under 

 section 48A, and

 ``(iv) the basis of any property which is part 

 of a qualifying gasification project under section 

 48B.''.

 (2) The table of sections for subpart E of part IV of 

 subchapter A of chapter 1 is amended by inserting after the item 

 relating to section 48 the following new items:

``Sec. 48A. Qualifying advanced coal project credit.

``Sec. 48B. Qualifying gasification project credit.''.

 (d) Effective Date.--The <<NOTE: 26 USC 46 note.>> amendments made 

by this section shall apply to periods after the date of the enactment 

of this Act, under rules similar to the rules of section 48(m) of the 

Internal Revenue Code of 1986 (as in effect on the day before the date 

of the enactment of the Revenue Reconciliation Act of 1990).

SEC. 1308. ELECTRIC TRANSMISSION PROPERTY TREATED AS 15-YEAR PROPERTY.

 (a) In General.--Subparagraph (E) of section 168(e)(3) (relating to 

classification of certain property) is amended by striking ``and'' at 

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the end of clause (v), by striking the period at the end of clause (vi) 

and inserting ``, and'', and by adding at the end the following new 

clause:

 ``(vii) any section 1245 property (as defined 

 in section 1245(a)(3)) used in the transmission at 

 69 or more kilovolts of electricity for sale and 

 the original use of which commences with the 

 taxpayer after April 11, 2005.''.

 (b) Alternative System.--The table contained in section 168(g)(3)(B) 

(relating to special rule for certain property assigned to classes) is 

amended by inserting after the item relating to subparagraph (E)(vi) the 

following new item:

``(E)(vii)................................................. 30''.

 (c) Effective <<NOTE: 26 USC 168 note.>> Date.--

 (1) In general.--The amendments made by this section shall 

 apply to property placed in service after April 11, 2005.

[[Page 119 STAT. 1007]]

 (2) Exception.--The amendments made by this section shall 

 not apply to any property with respect to which the taxpayer or 

 a related party has entered into a binding contract for the 

 construction thereof on or before April 11, 2005, or, in the 

 case of self-constructed property, has started construction on 

 or before such date.

SEC. 1309. EXPANSION OF AMORTIZATION FOR CERTAIN ATMOSPHERIC POLLUTION 

 CONTROL FACILITIES IN CONNECTION WITH PLANTS FIRST PLACED IN 

 SERVICE AFTER 1975.

 (a) Eligibility of Post-1975 Pollution Control Facilities.--

Subsection (d) of section 169 (relating to definitions) is amended by 

adding at the end the following:

 ``(5) Special rule relating to certain atmospheric pollution 

 control facilities.--In the case of any atmospheric pollution 

 control facility which is placed in service after April 11, 

 2005, and used in connection with an electric generation plant 

 or other property which is primarily coal fired--

 ``(A) paragraph (1) shall be applied without regard 

 to the phrase `in operation before January 1, 1976', and

 ``(B) this section shall be applied by substituting 

 `84' for `60' each place it appears in subsections (a) 

 and (b).''.

 (b) Treatment as New Identifiable Treatment Facility.--Subparagraph 

(B) of section 169(d)(4) is amended to read as follows:

 ``(B) Certain facilities placed in operation after 

 april 11, 2005.--In the case of any facility described 

 in paragraph (1) solely by reason of paragraph (5), 

 subparagraph (A) shall be applied by substituting `April 

 11, 2005' for `December 31, 1968' each place it appears 

 therein.''.

 (c) Conforming Amendment.--The heading for section 169(d) is amended 

by inserting ``and Special Rules'' after ``Definitions''.

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 (d) Technical Amendment.--Section 169(d)(3) is amended by striking 

``Health, Education, and Welfare'' and inserting ``Health and Human 

Services''.

 (e) Effective Date.--The <<NOTE: 26 USC 169 note.>> amendments made 

by this section shall apply to facilities placed in service after April 

11, 2005.

SEC. 1310. MODIFICATIONS TO SPECIAL RULES FOR NUCLEAR DECOMMISSIONING 

 COSTS.

 (a) Repeal of Limitation on Deposits Into Fund Based on Cost of 

Service; Contributions After Funding Period.--Subsection (b) of section 

468A (relating to special rules for nuclear decommissioning costs) is 

amended to read as follows:

 ``(b) Limitation on Amounts Paid Into Fund.--The amount which a 

taxpayer may pay into the Fund for any taxable year shall not exceed the 

ruling amount applicable to such taxable year.''.

 (b) Treatment of Certain Decommissioning Costs.--

 (1) In general.--Section 468A is amended by redesignating 

 subsections (f) and (g) as subsections (g) and (h), 

 respectively, and by inserting after subsection (e) the 

 following new subsection:

 ``(f) Transfers Into Qualified Funds.--

 ``(1) In general.--Notwithstanding subsection (b), any 

 taxpayer maintaining a Fund to which this section applies with 

 respect to a nuclear power plant may transfer into such Fund not 

 more than an amount equal to the present value of the

[[Page 119 STAT. 1008]]

 portion of the total nuclear decommissioning costs with respect 

 to such nuclear power plant previously excluded for such nuclear 

 power plant under subsection (d)(2)(A) as in effect immediately 

 before the date of the enactment of this subsection.

 ``(2) Deduction for amounts transferred.--

 ``(A) In general.--Except as provided in 

 subparagraph (C), the deduction allowed by subsection 

 (a) for any transfer permitted by this subsection shall 

 be allowed ratably over the remaining estimated useful 

 life (within the meaning of subsection (d)(2)(A)) of the 

 nuclear power plant beginning with the taxable year 

 during which the transfer is made.

 ``(B) Denial of deduction for previously deducted 

 amounts.--No deduction shall be allowed for any transfer 

 under this subsection of an amount for which a deduction 

 was previously allowed to the taxpayer (or a 

 predecessor) or a corresponding amount was not included 

 in gross income of the taxpayer (or a predecessor). For 

 purposes of the preceding sentence, a ratable portion of 

 each transfer shall be treated as being from previously 

 deducted or excluded amounts to the extent thereof.

 ``(C) Transfers of qualified funds.--If--

 ``(i) any transfer permitted by this 

 subsection is made to any Fund to which this 

 section applies, and

 ``(ii) such Fund is transferred thereafter,

 any deduction under this subsection for taxable years 

 ending after the date that such Fund is transferred 

 shall be allowed to the transferor for the taxable year 

 which includes such date.

 ``(D) Special rules.--

 ``(i) Gain or loss not recognized on transfers 

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 to fund.--No gain or loss shall be recognized on 

 any transfer described in paragraph (1).

 ``(ii) Transfers of appreciated property to 

 fund.--If appreciated property is transferred in a 

 transfer described in paragraph (1), the amount of 

 the deduction shall not exceed the adjusted basis 

 of such property.

 ``(3) New ruling amount required.--Paragraph (1) shall not 

 apply to any transfer unless the taxpayer requests from the 

 Secretary a new schedule of ruling amounts in connection with 

 such transfer.

 ``(4) No basis in qualified funds.--Notwithstanding any 

 other provision of law, the taxpayer's basis in any Fund to 

 which this section applies shall not be increased by reason of 

 any transfer permitted by this subsection.''.

 (2) New ruling amount to take into account total costs.--

 Subparagraph (A) of section 468A(d)(2) (defining ruling amount) 

 is amended to read as follows:

 ``(A) fund the total nuclear decommissioning costs 

 with respect to such power plant over the estimated 

 useful life of such power plant, and''.

 (c) New Ruling Amount Required Upon License Renewal.--Paragraph (1) 

of section 468A(d) (relating to request required) is amended by adding 

at the end the following new sentence: ``For purposes of the preceding 

sentence, the taxpayer shall request a schedule of ruling amounts upon 

each renewal of the operating license of the nuclear powerplant.''.

[[Page 119 STAT. 1009]]

 (d) Conforming Amendment.--Section 468A(e)(3) (relating to review of 

amount) is amended by striking ``The Fund'' and inserting ``Except as 

provided in subsection (f), the Fund''.

 (e) Technical Amendments.--Section 468A(e)(2) (relating to taxation 

of Fund) is amended--

 (1) by striking ``rate set forth in subparagraph (B)'' in 

 subparagraph (A) and inserting ``rate of 20 percent'',

 (2) by striking subparagraph (B), and

 (3) by redesignating subparagraphs (C) and (D) as 

 subparagraphs (B) and (C), respectively.

 (f) Effective Date.--The <<NOTE: 26 USC 468A note.>> amendments made 

by this section shall apply to taxable years beginning after December 

31, 2005.

SEC. 1311. FIVE-YEAR NET OPERATING LOSS CARRYOVER FOR CERTAIN LOSSES.

 Paragraph (1) of section 172(b) (relating to net operating loss 

carrybacks and carryovers) is amended by adding at the end the following 

new subparagraph:

 ``(I) Transmission property and pollution control 

 investment.--

 ``(i) In general.--At the election of the 

 taxpayer in any taxable year ending after December 

 31, 2005, and before January 1, 2009, in the case 

 of a net operating loss in a taxable year ending 

 after December 31, 2002, and before January 1, 

 2006, there shall be a net operating loss 

 carryback to each of the 5 years preceding the 

 taxable year of such loss to the extent that such 

 loss does not exceed 20 percent of the sum of 

 electric transmission property capital 

 expenditures and pollution control facility 

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 capital expenditures of the taxpayer for the 

 taxable year preceding the taxable year in which 

 such election is made.

 ``(ii) Limitations.--For purposes of this 

 subsection--

 ``(I) not more than one election may 

 be made under clause (i) with respect to 

 any net operating loss in a taxable 

 year, and

 ``(II) an election may not be made 

 under clause (i) for more than 1 taxable 

 year beginning in any calendar year.

 ``(iii) Coordination with ordering rule.--For 

 purposes of applying subsection (b)(2), the 

 portion of any loss which is carried back 5 years 

 by reason of clause (i) shall be treated in a 

 manner similar to the manner in which a specified 

 liability loss is treated.

 ``(iv) Application <<NOTE: Deadline.>> for 

 adjustment.--In the case of any portion of a net 

 operating loss to which an election under clause 

 (i) applies, an application under section 6411(a) 

 with respect to such loss shall not fail to be 

 treated as timely filed if filed within 24 months 

 after the due date specified under such section.

 ``(v) Special rules relating to refund.--For 

 purposes of a net operating loss to which an 

 election under clause (i) applies, references in 

 sections 6501(h), 6511(d)(2)(A), and 6611(f)(1) to 

 the taxable year in which such net operating loss 

 arises or result in a

[[Page 119 STAT. 1010]]

 net loss carryback shall be treated as references 

 to the taxable year in which such election occurs.

 ``(vi) Definitions.--For purposes of this 

 subparagraph--

 ``(I) Electric transmission property 

 capital expenditures.--The term 

 `electric transmission property capital 

 expenditures' means any expenditure, 

 chargeable to capital account, made by 

 the taxpayer which is attributable to 

 electric transmission property used by 

 the taxpayer in the transmission at 69 

 or more kilovolts of electricity for 

 sale. Such term shall not include any 

 expenditure which may be refunded or the 

 purpose of which may be modified at the 

 option of the taxpayer so as to cease to 

 be treated as an expenditure within the 

 meaning of such term.

 ``(II) Pollution control facility 

 capital expenditures.--The term 

 `pollution control facility capital 

 expenditures' means any expenditure, 

 chargeable to capital account, made by 

 an electric utility company (as defined 

 in section 2(3) of the Public Utility 

 Holding Company Act (15 U.S.C. 79b(3)), 

 as in effect on the day before the date 

 of the enactment of the Energy Tax 

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 Incentives Act of 2005) which is 

 attributable to a facility which will 

 qualify as a certified pollution control 

 facility as determined under section 

 169(d)(1) by striking `before January 1, 

 1976,' and by substituting `an 

 identifiable' for `a new identifiable'. 

 Such term shall not include any 

 expenditure which may be refunded or the 

 purpose of which may be modified at the 

 option of the taxpayer so as to cease to 

 be treated as an expenditure within the 

 meaning of such term.''.

 Subtitle B--Domestic Fossil Fuel Security

SEC. 1321. EXTENSION OF CREDIT FOR PRODUCING FUEL FROM A NONCONVENTIONAL 

 SOURCE FOR FACILITIES PRODUCING COKE OR COKE GAS.

 (a) In General.--Section 29 (relating to credit for producing fuel 

from a nonconventional source) is amended by adding at the end the 

following new subsection:

 ``(h) Extension for Facilities Producing Coke or Coke Gas.--

Notwithstanding subsection (f)--

 ``(1) In general.--In the case of a facility for producing 

 coke or coke gas which was placed in service before January 1, 

 1993, or after June 30, 1998, and before January 1, 2010, this 

 section shall apply with respect to coke and coke gas produced 

 in such facility and sold during the period--

 ``(A) beginning on the later of January 1, 2006, or 

 the date that such facility is placed in service, and

 ``(B) ending on the date which is 4 years after the 

 date such period began.

[[Page 119 STAT. 1011]]

 ``(2) Special rules.--In determining the amount of credit 

 allowable under this section solely by reason of this 

 subsection--

 ``(A) Daily limit.--The amount of qualified fuels 

 sold during any taxable year which may be taken into 

 account by reason of this subsection with respect to any 

 facility shall not exceed an average barrel-of-oil 

 equivalent of 4,000 barrels per day. Days before the 

 date the facility is placed in service shall not be 

 taken into account in determining such average.

 ``(B) Extension period to commence with unadjusted 

 credit amount.--For purposes of applying subsection 

 (b)(2) to the $3 amount in subsection (a), in the case 

 of fuels sold after 2005, subsection (d)(2)(B) shall be 

 applied by substituting `2004' for `1979'.

 ``(C) Denial of double benefit.--This subsection 

 shall not apply to any facility producing qualified 

 fuels for which a credit was allowed under this section 

 for the taxable year or any preceding taxable year by 

 reason of subsection (g).''.

 (b) Effective Date.--The <<NOTE: 26 USC 29 note.>> amendment made by 

this section shall apply to fuel produced and sold after December 31, 

2005, in taxable years ending after such date.

SEC. 1322. MODIFICATION OF CREDIT FOR PRODUCING FUEL FROM A 

 NONCONVENTIONAL SOURCE.

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 (a) Treatment as Business Credit.--

 (1) Credit moved to subpart relating to business related 

 credits.--The Internal Revenue Code of 1986 is amended by 

 redesignating section 29 as section 45K and by moving section 

 45K (as so redesignated) from subpart B of part IV of subchapter 

 A of chapter 1 to the end of subpart D of part IV of subchapter 

 A of chapter 1.

 (2) Credit treated as business credit.--Section 38(b), as 

 amended by this Act, is amended by striking ``plus'' at the end 

 of paragraph (20), by striking the period at the end of 

 paragraph (21) and inserting ``, plus'', and by adding at the 

 end the following:

 ``(22) the nonconventional source production credit 

 determined under section 45K(a).''.

 (3) Conforming amendments.--

 (A) Section 30(b)(3)(A) is amended by striking 

 ``sections 27 and 29'' and inserting ``section 27''.

 (B) Sections 43(b)(2), 45I(b)(2)(C)(i), and 

 613A(c)(6)(C) are each amended by striking ``section 

 29(d)(2)(C)'' and inserting ``section 45K(d)(2)(C)''.

 (C) Section 45(e)(9), as added by this Act, is 

 amended--

 (i) by striking ``section 29'' each place it 

 appears and inserting ``section 45K'', and

 (ii) by inserting ``(or under section 29, as 

 in effect on the day before the date of enactment 

 of the Energy Tax Incentives Act of 2005, for any 

 prior taxable year)'' before the period at the end 

 thereof.

 (D) Section 45I is amended--

 (i) in subsection (c)(2)(A) by striking 

 ``section 29(d)(5))'' and inserting ``section 

 45K(d)(5))'', and

[[Page 119 STAT. 1012]]

 (ii) in subsection (d)(3) by striking 

 ``section 29'' both places it appears and 

 inserting ``section 45K''.

 (E) Section 45K(a), as redesignated by paragraph 

 (1), is amended by striking ``There shall be allowed as 

 a credit against the tax imposed by this chapter for the 

 taxable year'' and inserting ``For purposes of section 

 38, if the taxpayer elects to have this section apply, 

 the nonconventional source production credit determined 

 under this section for the taxable year is''.

 (F) Section 45K(b), as so redesignated, is amended 

 by striking paragraph (6).

 (G) Section 53(d)(1)(B)(iii) is amended by striking 

 ``under section 29'' and all that follows through ``or 

 not allowed''.

 (H) Section 55(c)(3) is amended by striking 

 ``29(b)(6),''.

 (I) Subsection (a) of section 772 is amended by 

 inserting ``and'' at the end of paragraph (9), by 

 striking paragraph (10), and by redesignating paragraph 

 (11) as paragraph (10).

 (J) Paragraph (5) of section 772(d) is amended by 

 striking ``the foreign tax credit, and the credit 

 allowable under section 29'' and inserting ``and the 

 foreign tax credit''.

 (K) The table of sections for subpart B of part IV 

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 of subchapter A of chapter 1 is amended by striking the 

 item relating to section 29.

 (L) The table of sections for subpart D of part IV 

 of subchapter A of chapter 1 is amended by inserting 

 after the item relating to section 45I the following new 

 item:

``Sec. 45K. Credit for producing fuel from a nonconventional source.''.

 (b) Amendments Conforming to the Repeal of the Natural Gas Policy 

Act of 1978.--

 (1) In general.--Section 29(c)(2)(A) (before redesignation 

 under subsection (a) and as amended by section 1321) is 

 amended--

 (A) by inserting ``(as in effect before the repeal 

 of such section)'' after ``1978'', and

 (B) by striking subsection (e) and redesignating 

 subsections (f), (g), and (h) as subsections (e), (f), 

 and (g), respectively.

 (2) Conforming amendments.--Section 29(g)(1) (before 

 redesignation under subsection (a) and paragraph (1) of this 

 subsection) is amended--

 (A) in subparagraph (A) by striking ``subsection 

 (f)(1)(B)'' and inserting ``subsection (e)(1)(B)'', and

 (B) in subparagraph (B) by striking ``subsection 

 (f)'' and inserting ``subsection (e)''.

 (c) Effective <<NOTE: 26 USC 29 note.>> Dates.--

 (1) In general.--Except as provided in paragraph (2), the 

 amendments made by this section shall apply to credits 

 determined under the Internal Revenue Code of 1986 for taxable 

 years ending after December 31, 2005.

 (2) Subsection (b).--The amendments made by subsection (b) 

 shall take effect on the date of the enactment of this Act.

[[Page 119 STAT. 1013]]

SEC. 1323. TEMPORARY EXPENSING FOR EQUIPMENT USED IN REFINING OF LIQUID 

 FUELS.

 (a) In General.--Part VI of subchapter B of chapter 1 is amended by 

inserting after section 179B the following new section:

``SEC. 179C. ELECTION TO EXPENSE CERTAIN REFINERIES.

 ``(a) Treatment as Expenses.--A taxpayer may elect to treat 50 

percent of the cost of any qualified refinery property as an expense 

which is not chargeable to capital account. Any cost so treated shall be 

allowed as a deduction for the taxable year in which the qualified 

refinery property is placed in service.

 ``(b) Election.--

 ``(1) In general.--An election under this section for any 

 taxable year shall be made on the taxpayer's return of the tax 

 imposed by this chapter for the taxable year. Such election 

 shall be made in such manner as the Secretary may by regulations 

 prescribe.

 ``(2) Election irrevocable.--Any election made under this 

 section may not be revoked except with the consent of the 

 Secretary.

 ``(c) Qualified Refinery Property.--

 ``(1) In general.--The term `qualified refinery property' 

 means any portion of a qualified refinery--

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 ``(A) the original use of which commences with the 

 taxpayer,

 ``(B) which is placed in service by the taxpayer 

 after the date of the enactment of this section and 

 before January 1, 2012,

 ``(C) in the case any portion of a qualified 

 refinery (other than a qualified refinery which is 

 separate from any existing refinery), which meets the 

 requirements of subsection (e),

 ``(D) which meets all applicable environmental laws 

 in effect on the date such portion was placed in 

 service,

 ``(E) no written binding contract for the 

 construction of which was in effect on or before June 

 14, 2005, and

 ``(F)(i) the construction of which is subject to a 

 written binding construction contract entered into 

 before January 1, 2008,

 ``(ii) which is placed in service before January 1, 

 2008, or

 ``(iii) in the case of self-constructed property, 

 the construction of which began after June 14, 2005, and 

 before January 1, 2008.

 ``(2) Special rule for sale-leasebacks.--For purposes of 

 paragraph (1)(A), if property is--

 ``(A) originally placed in service after the date of 

 the enactment of this section by a person, and

 ``(B) sold and leased back by such person within 3 

 months after the date such property was originally 

 placed in service,

 such property shall be treated as originally placed in service 

 not earlier than the date on which such property is used under 

 the leaseback referred to in subparagraph (B).

 ``(3) Effect of waiver under clean air act.--A waiver under 

 the Clean Air Act shall not be taken into account in

[[Page 119 STAT. 1014]]

 determining whether the requirements of paragraph (1)(D) are 

 met.

 ``(d) Qualified Refinery.--For purposes of this section, the term 

`qualified refinery' means any refinery located in the United States 

which is designed to serve the primary purpose of processing liquid fuel 

from crude oil or qualified fuels (as defined in section 45K(c)).

 ``(e) Production Capacity.--The requirements of this subsection are 

met if the portion of the qualified refinery--

 ``(1) enables the existing qualified refinery to increase 

 total volume output (determined without regard to asphalt or 

 lube oil) by 5 percent or more on an average daily basis, or

 ``(2) enables the existing qualified refinery to process 

 qualified fuels (as defined in section 45K(c)) at a rate which 

 is equal to or greater than 25 percent of the total throughput 

 of such qualified refinery on an average daily basis.

 ``(f) Ineligible Refinery Property.--No deduction shall be allowed 

under subsection (a) for any qualified refinery property--

 ``(1) the primary purpose of which is for use as a topping 

 plant, asphalt plant, lube oil facility, crude or product 

 terminal, or blending facility, or

 ``(2) which is built solely to comply with consent decrees 

 or projects mandated by Federal, State, or local governments.

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 ``(g) Election to Allocate Deduction to Cooperative Owner.--

 ``(1) In general.--If--

 ``(A) a taxpayer to which subsection (a) applies is 

 an organization to which part I of subchapter T applies, 

 and

 ``(B) one or more persons directly holding an 

 ownership interest in the taxpayer are organizations to 

 which part I of subchapter T apply,

 the taxpayer may elect to allocate all or a portion of the 

 deduction allowable under subsection (a) to such persons. Such 

 allocation shall be equal to the person's ratable share of the 

 total amount allocated, determined on the basis of the person's 

 ownership interest in the taxpayer. The taxable income of the 

 taxpayer shall not be reduced under section 1382 by reason of 

 any amount to which the preceding sentence applies.

 ``(2) Form and effect of election.--An election under 

 paragraph (1) for any taxable year shall be made on a timely 

 filed return for such year. Such election, once made, shall be 

 irrevocable for such taxable year.

 ``(3) Written notice to owners.--If any portion of the 

 deduction available under subsection (a) is allocated to owners 

 under paragraph (1), the cooperative shall provide any owner 

 receiving an allocation written notice of the amount of the 

 allocation. <<NOTE: Deadline.>> Such notice shall be provided 

 before the date on which the return described in paragraph (2) 

 is due.

 ``(h) Reporting.--No deduction shall be allowed under subsection (a) 

to any taxpayer for any taxable year unless such taxpayer files with the 

Secretary a report containing such information with respect to the 

operation of the refineries of the taxpayer as the Secretary shall 

require.''.

 (b) Conforming Amendments.--

 (1) Section 1245(a) is amended by inserting ``179C,'' after 

 ``179B,'' both places it appears in paragraphs (2)(C) and 

 (3)(C).

[[Page 119 STAT. 1015]]

 (2) Section 263(a)(1) is amended by striking ``or'' at the 

 end of subparagraph (H), by striking the period at the end of 

 subparagraph (I) and inserting ``, or'', and by inserting after 

 subparagraph (I) the following new subparagraph:

 ``(J) expenditures for which a deduction is allowed 

 under section 179C.''.

 (3) Section 312(k)(3)(B) is amended by striking ``179 179A, 

 or 179B'' each place it appears in the heading and text and 

 inserting ``179, 179A, 179B, or 179C''.

 (4) The table of sections for part VI of subchapter B of 

 chapter 1 is amended by inserting after the item relating to 

 section 179B the following new item:

``Sec. 179C. Election to expense certain refineries.''.

 (c) Effective Date.--The <<NOTE: 26 USC 179C note.>> amendments made 

by this section shall apply to properties placed in service after the 

date of the enactment of this Act.

SEC. 1324. PASS THROUGH TO OWNERS OF DEDUCTION FOR CAPITAL COSTS 

 INCURRED BY SMALL REFINER COOPERATIVES IN COMPLYING WITH 

 ENVIRONMENTAL PROTECTION AGENCY SULFUR REGULATIONS.

 (a) In General.--Section 179B (relating to deduction for capital 

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costs incurred in complying with Environmental Protection Agency sulfur 

regulations) is amended by adding at the end the following new 

subsection:

 ``(e) Election to Allocate Deduction to Cooperative Owner.--

 ``(1) In general.--If--

 ``(A) a small business refiner to which subsection 

 (a) applies is an organization to which part I of 

 subchapter T applies, and

 ``(B) one or more persons directly holding an 

 ownership interest in the refiner are organizations to 

 which part I of subchapter T apply,

 the refiner may elect to allocate all or a portion of the 

 deduction allowable under subsection (a) to such persons. Such 

 allocation shall be equal to the person's ratable share of the 

 total amount allocated, determined on the basis of the person's 

 ownership interest in the taxpayer. The taxable income of the 

 refiner shall not be reduced under section 1382 by reason of any 

 amount to which the preceding sentence applies.

 ``(2) Form and effect of election.--An election under 

 paragraph (1) for any taxable year shall be made on a timely 

 filed return for such year. Such election, once made, shall be 

 irrevocable for such taxable year.

 ``(3) Written notice to owners.--If any portion of the 

 deduction available under subsection (a) is allocated to owners 

 under paragraph (1), the cooperative shall provide any owner 

 receiving an allocation written notice of the amount of the 

 allocation. <<NOTE: Deadline.>> Such notice shall be provided 

 before the date on which the return described in paragraph (2) 

 is due.''.

 (b) Effective Date.--The <<NOTE: 26 USC 179B note.>> amendment made 

by this section shall take effect as if included in the amendment made 

by section 338(a) of the American Jobs Creation Act of 2004.

[[Page 119 STAT. 1016]]

SEC. 1325. NATURAL GAS DISTRIBUTION LINES TREATED AS 15-YEAR PROPERTY.

 (a) In General.--Section 168(e)(3)(E) (defining 15-year property), 

as amended by this Act, is amended by striking ``and'' at the end of 

clause (vi), by striking the period at the end of clause (vii) and by 

inserting ``, and'', and by adding at the end the following new clause:

 ``(viii) any natural gas distribution line the 

 original use of which commences with the taxpayer 

 after April 11, 2005, and which is placed in 

 service before January 1, 2011.''.

 (b) Alternative System.--The table contained in section 168(g)(3)(B) 

(relating to special rule for certain property assigned to classes), as 

amended by this Act, is amended by inserting after the item relating to 

subparagraph (E)(vii) the following new item:

``(E)(viii)................................................ 35''.

 (c) Effective <<NOTE: 26 USC 168 note.>> Date.--

 (1) In general.--The amendments made by this section shall 

 apply to property placed in service after April 11, 2005.

 (2) Exception.--The amendments made by this section shall 

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 not apply to any property with respect to which the taxpayer or 

 a related party has entered into a binding contract for the 

 construction thereof on or before April 11, 2005, or, in the 

 case of self-constructed property, has started construction on 

 or before such date.

SEC. 1326. NATURAL GAS GATHERING LINES TREATED AS 7-YEAR PROPERTY.

 (a) In General.--Subparagraph (C) of section 168(e)(3) (relating to 

classification of certain property) is amended by striking ``and'' at 

the end of clause (iii), by redesignating clause (iv) as clause (v), and 

by inserting after clause (iii) the following new clause:

 ``(iv) any natural gas gathering line the 

 original use of which commences with the taxpayer 

 after April 11, 2005, and''.

 (b) Natural Gas Gathering Line.--Subsection (i) of section 168 is 

amended by inserting after paragraph (16) the following new paragraph:

 ``(17) Natural gas gathering line.--The term `natural gas 

 gathering line' means--

 ``(A) the pipe, equipment, and appurtenances 

 determined to be a gathering line by the Federal Energy 

 Regulatory Commission, and

 ``(B) the pipe, equipment, and appurtenances used to 

 deliver natural gas from the wellhead or a commonpoint 

 to the point at which such gas first reaches--

 ``(i) a gas processing plant,

 ``(ii) an interconnection with a transmission 

 pipeline for which a certificate as an interstate 

 transmission pipeline has been issued by the 

 Federal Energy Regulatory Commission,

[[Page 119 STAT. 1017]]

 ``(iii) an interconnection with an intrastate 

 transmission pipeline, or

 ``(iv) a direct interconnection with a local 

 distribution company, a gas storage facility, or 

 an industrial consumer.''.

 (c) Alternative System.--The table contained in section 168(g)(3)(B) 

(relating to special rule for certain property assigned to classes), as 

amended by this Act, is amended by inserting after the item relating to 

subparagraph (C)(iii) the following new item:

``(C)(iv).................................................. 14''.

 (d) Alternative Minimum Tax Exception.--Subparagraph (B) of section 

56(a)(1) is amended by inserting before the period the following: ``, or 

in section 168(e)(3)(C)(iv)''.

 (e) Effective <<NOTE: 26 USC 56 note.>> Date.--

 (1) In general.--The amendments made by this section shall 

 apply to property placed in service after April 11, 2005.

 (2) Exception.--The amendments made by this section shall 

 not apply to any property with respect to which the taxpayer or 

 a related party has entered into a binding contract for the 

 construction thereof on or before April 11, 2005, or, in the 

 case of self-constructed property, has started construction on 

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 or before such date.

SEC. 1327. ARBITRAGE RULES NOT TO APPLY TO PREPAYMENTS FOR NATURAL GAS.

 (a) In General.--Subsection (b) of section 148 (relating to higher 

yielding investments) is amended by adding at the end the following new 

paragraph:

 ``(4) Safe harbor for prepaid natural gas.--

 ``(A) In general.--The term `investment-type 

 property' does not include a prepayment under a 

 qualified natural gas supply contract.

 ``(B) Qualified natural gas supply contract.--For 

 purposes of this paragraph, the term `qualified natural 

 gas supply contract' means any contract to acquire 

 natural gas for resale by a utility owned by a 

 governmental unit if the amount of gas permitted to be 

 acquired under the contract by the utility during any 

 year does not exceed the sum of--

 ``(i) the annual average amount during the 

 testing period of natural gas purchased (other 

 than for resale) by customers of such utility who 

 are located within the service area of such 

 utility, and

 ``(ii) the amount of natural gas to be used to 

 transport the prepaid natural gas to the utility 

 during such year.

 ``(C) Natural gas used to generate electricity.--

 Natural gas used to generate electricity shall be taken 

 into account in determining the average under 

 subparagraph (B)(i)--

 ``(i) only if the electricity is generated by 

 a utility owned by a governmental unit, and

[[Page 119 STAT. 1018]]

 ``(ii) only to the extent that the electricity 

 is sold (other than for resale) to customers of 

 such utility who are located within the service 

 area of such utility.

 ``(D) Adjustments <<NOTE: Contracts.>> for changes 

 in customer base.--

 ``(i) New business customers.--If--

 ``(I) after the close of the testing 

 period and before the date of issuance 

 of the issue, the utility owned by a 

 governmental unit enters into a contract 

 to supply natural gas (other than for 

 resale) for a business use at a property 

 within the service area of such utility, 

 and

 ``(II) the utility did not supply 

 natural gas to such property during the 

 testing period or the ratable amount of 

 natural gas to be supplied under the 

 contract is significantly greater than 

 the ratable amount of gas supplied to 

 such property during the testing period,

 then a contract shall not fail to be treated as a 

 qualified natural gas supply contract by reason of 

 supplying the additional natural gas under the 

 contract referred to in subclause (I).

 ``(ii) Lost customers.--The average under 

 subparagraph (B)(i) shall not exceed the annual 

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 amount of natural gas reasonably expected to be 

 purchased (other than for resale) by persons who 

 are located within the service area of such 

 utility and who, as of the date of issuance of the 

 issue, are customers of such utility.

 ``(E) Ruling requests.--The Secretary may increase 

 the average under subparagraph (B)(i) for any period if 

 the utility owned by the governmental unit establishes 

 to the satisfaction of the Secretary that, based on 

 objective evidence of growth in natural gas consumption 

 or population, such average would otherwise be 

 insufficient for such period.

 ``(F) Adjustment for natural gas otherwise on 

 hand.--

 ``(i) In general.--The amount otherwise 

 permitted to be acquired under the contract for 

 any period shall be reduced by--

 ``(I) the applicable share of 

 natural gas held by the utility on the 

 date of issuance of the issue, and

 ``(II) the natural gas (not taken 

 into account under subclause (I)) which 

 the utility has a right to acquire 

 during such period (determined as of the 

 date of issuance of the issue).

 ``(ii) Applicable share.--For purposes of the 

 clause (i), the term `applicable share' means, 

 with respect to any period, the natural gas 

 allocable to such period if the gas were allocated 

 ratably over the period to which the prepayment 

 relates.

 ``(G) Intentional acts.--Subparagraph (A) shall 

 cease to apply to any issue if the utility owned by the 

 governmental unit engages in any intentional act to 

 render the volume of natural gas acquired by such 

 prepayment to be in excess of the sum of--

[[Page 119 STAT. 1019]]

 ``(i) the amount of natural gas needed (other 

 than for resale) by customers of such utility who 

 are located within the service area of such 

 utility, and

 ``(ii) the amount of natural gas used to 

 transport such natural gas to the utility.

 ``(H) Testing period.--For purposes of this 

 paragraph, the term `testing period' means, with respect 

 to an issue, the most recent 5 calendar years ending 

 before the date of issuance of the issue.

 ``(I) Service area.--For purposes of this paragraph, 

 the service area of a utility owned by a governmental 

 unit shall be comprised of--

 ``(i) any area throughout which such utility 

 provided at all times during the testing period--

 ``(I) in the case of a natural gas 

 utility, natural gas transmission or 

 distribution services, and

 ``(II) in the case of an electric 

 utility, electricity distribution 

 services,

 ``(ii) any area within a county contiguous to 

 the area described in clause (i) in which retail 

 customers of such utility are located if such area 

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 is not also served by another utility providing 

 natural gas or electricity services, as the case 

 may be, and

 ``(iii) any area recognized as the service 

 area of such utility under State or Federal 

 law.''.

 (b) Private Loan Financing Test Not to Apply to Prepayments for 

Natural Gas.--Paragraph (2) of section 141(c) (providing exceptions to 

the private loan financing test) is amended by striking ``or'' at the 

end of subparagraph (A), by striking the period at the end of 

subparagraph (B) and inserting ``, or'', and by adding at the end the 

following new subparagraph:

 ``(C) is a qualified natural gas supply contract (as 

 defined in section 148(b)(4)).''.

 (c) Exception for Qualified Electric and Natural Gas Supply 

Contracts.--Section 141(d) is amended by adding at the end the following 

new paragraph:

 ``(7) Exception for qualified electric and natural gas 

 supply contracts.--The term `nongovernmental output property' 

 shall not include any contract for the prepayment of electricity 

 or natural gas which is not investment property under section 

 148(b)(2).''.

 (d) Effective Date.--The <<NOTE: 26 USC 141 note.>> amendments made 

by this section shall apply to obligations issued after the date of the 

enactment of this Act.

SEC. 1328. DETERMINATION OF SMALL REFINER EXCEPTION TO OIL DEPLETION 

 DEDUCTION.

 (a) In General.--Paragraph (4) of section 613A(d) (relating to 

limitations on application of subsection (c)) is amended to read as 

follows:

 ``(4) Certain refiners excluded.--If the taxpayer or one or 

 more related persons engages in the refining of crude oil, 

 subsection (c) shall not apply to the taxpayer for a taxable 

 year if the average daily refinery runs of the taxpayer and such 

 persons for the taxable year exceed 75,000 barrels. For purposes 

 of this paragraph, the average daily refinery runs

[[Page 119 STAT. 1020]]

 for any taxable year shall be determined by dividing the 

 aggregate refinery runs for the taxable year by the number of 

 days in the taxable year.''.

 (b) Effective Date.--The <<NOTE: 26 USC 613A note.>> amendment made 

by this section shall apply to taxable years ending after the date of 

the enactment of this Act.

SEC. 1329. AMORTIZATION OF GEOLOGICAL AND GEOPHYSICAL EXPENDITURES.

 (a) In General.--Section 167 (relating to depreciation) is amended 

by redesignating subsection (h) as subsection (i) and by inserting after 

subsection (g) the following new subsection:

 ``(h) Amortization of Geological and Geophysical Expenditures.--

 ``(1) In general.--Any geological and geophysical expenses 

 paid or incurred in connection with the exploration for, or 

 development of, oil or gas within the United States (as defined 

 in section 638) shall be allowed as a deduction ratably over the 

 24-month period beginning on the date that such expense was paid 

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 or incurred.

 ``(2) Half-year convention.--For purposes of paragraph (1), 

 any payment paid or incurred during the taxable year shall be 

 treated as paid or incurred on the mid-point of such taxable 

 year.

 ``(3) Exclusive method.--Except as provided in this 

 subsection, no depreciation or amortization deduction shall be 

 allowed with respect to such payments.

 ``(4) Treatment upon abandonment.--If any property with 

 respect to which geological and geophysical expenses are paid or 

 incurred is retired or abandoned during the 24-month period 

 described in paragraph (1), no deduction shall be allowed on 

 account of such retirement or abandonment and the amortization 

 deduction under this subsection shall continue with respect to 

 such payment.''.

 (b) Conforming Amendment.--Section 263A(c)(3) is amended by 

inserting ``167(h),'' after ``under section''.

 (c) Effective Date.--The <<NOTE: 26 USC 167 note.>> amendments made 

by this section shall apply to amounts paid or incurred in taxable years 

beginning after the date of the enactment of this Act.

 Subtitle C--Conservation and Energy Efficiency Provisions

SEC. 1331. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION.

 (a) In General.--Part VI of subchapter B of chapter 1 (relating to 

itemized deductions for individuals and corporations), as amended by 

this Act, is amended by inserting after section 179C the following new 

section:

``SEC. 179D. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION.

 ``(a) In General.--There shall be allowed as a deduction an amount 

equal to the cost of energy efficient commercial building property 

placed in service during the taxable year.

 ``(b) Maximum Amount of Deduction.--The deduction under subsection 

(a) with respect to any building for any taxable year shall not exceed 

the excess (if any) of--

[[Page 119 STAT. 1021]]

 ``(1) the product of--

 ``(A) $1.80, and

 ``(B) the square footage of the building, over

 ``(2) the aggregate amount of the deductions under 

 subsection (a) with respect to the building for all prior 

 taxable years.

 ``(c) Definitions.--For purposes of this section--

 ``(1) Energy efficient commercial building property.--The 

 term `energy efficient commercial building property' means 

 property--

 ``(A) with respect to which depreciation (or 

 amortization in lieu of depreciation) is allowable,

 ``(B) which is installed on or in any building which 

 is--

 ``(i) located in the United States, and

 ``(ii) within the scope of Standard 90.1-2001,

 ``(C) which is installed as part of--

 ``(i) the interior lighting systems,

 ``(ii) the heating, cooling, ventilation, and 

 hot water systems, or

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 ``(iii) the building envelope, and

 ``(D) which is certified in accordance with 

 subsection (d)(6) as being installed as part of a plan 

 designed to reduce the total annual energy and power 

 costs with respect to the interior lighting systems, 

 heating, cooling, ventilation, and hot water systems of 

 the building by 50 percent or more in comparison to a 

 reference building which meets the minimum requirements 

 of Standard 90.1-2001 using methods of calculation under 

 subsection (d)(2).

 ``(2) Standard 90.1-2001.--The term `Standard 90.1-2001' 

 means Standard 90.1-2001 of the American Society of Heating, 

 Refrigerating, and Air Conditioning Engineers and the 

 Illuminating Engineering Society of North America (as in effect 

 on April 2, 2003).

 ``(d) Special Rules.--

 ``(1) Partial allowance.--

 ``(A) In general.--Except as provided in subsection 

 (f), if--

 ``(i) the requirement of subsection (c)(1)(D) 

 is not met, but

 ``(ii) there is a certification in accordance 

 with paragraph (6) that any system referred to in 

 subsection (c)(1)(C) satisfies the energy-savings 

 targets established by the Secretary under 

 subparagraph (B) with respect to such system,

 then the requirement of subsection (c)(1)(D) shall be 

 treated as met with respect to such system, and the 

 deduction under subsection (a) shall be allowed with 

 respect to energy efficient commercial building property 

 installed as part of such system and as part of a plan 

 to meet such targets, except that subsection (b) shall 

 be applied to such property by substituting `$.60' for 

 `$1.80'.

 ``(B) Regulations.--The Secretary, after 

 consultation with the Secretary of Energy, shall 

 establish a target for each system described in 

 subsection (c)(1)(C) which, if such targets were met for 

 all such systems, the building would meet the 

 requirements of subsection (c)(1)(D).

[[Page 119 STAT. 1022]]

 ``(2) Methods of calculation.--

 The <<NOTE: Regulations.>> Secretary, after consultation with 

 the Secretary of Energy, shall promulgate regulations which 

 describe in detail methods for calculating and verifying energy 

 and power consumption and cost, based on the provisions of the 

 2005 California Nonresidential Alternative Calculation Method 

 Approval Manual.

 ``(3) Computer software.--

 ``(A) In general.--Any calculation under paragraph 

 (2) shall be prepared by qualified computer software.

 ``(B) Qualified computer software.--For purposes of 

 this paragraph, the term `qualified computer software' 

 means software--

 ``(i) for which the software designer has 

 certified that the software meets all procedures 

 and detailed methods for calculating energy and 

 power consumption and costs as required by the 

 Secretary,

 ``(ii) which provides such forms as required 

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 to be filed by the Secretary in connection with 

 energy efficiency of property and the deduction 

 allowed under this section, and

 ``(iii) which provides a notice form which 

 documents the energy efficiency features of the 

 building and its projected annual energy costs.

 ``(4) Allocation of deduction for public property.--In the 

 case of energy efficient commercial building property installed 

 on or in property owned by a Federal, State, or local government 

 or a political subdivision thereof, the Secretary shall 

 promulgate a regulation to allow the allocation of the deduction 

 to the person primarily responsible for designing the property 

 in lieu of the owner of such property. Such person shall be 

 treated as the taxpayer for purposes of this section.

 ``(5) Notice to owner.--Each certification required under 

 this section shall include an explanation to the building owner 

 regarding the energy efficiency features of the building and its 

 projected annual energy costs as provided in the notice under 

 paragraph (3)(B)(iii).

 ``(6) Certification.--

 ``(A) In general.--The Secretary shall prescribe the 

 manner and method for the making of certifications under 

 this section.

 ``(B) Procedures.--The Secretary shall include as 

 part of the certification process procedures for 

 inspection and testing by qualified individuals 

 described in subparagraph (C) to ensure compliance of 

 buildings with energy-savings plans and targets. Such 

 procedures shall be comparable, given the difference 

 between commercial and residential buildings, to the 

 requirements in the Mortgage Industry National 

 Accreditation Procedures for Home Energy Rating Systems.

 ``(C) Qualified individuals.--Individuals qualified 

 to determine compliance shall be only those individuals 

 who are recognized by an organization certified by the 

 Secretary for such purposes.

 ``(e) Basis Reduction.--For purposes of this subtitle, if a 

deduction is allowed under this section with respect to any energy 

efficient commercial building property, the basis of such property shall 

be reduced by the amount of the deduction so allowed.

[[Page 119 STAT. 1023]]

 ``(f) Interim Rules for Lighting Systems.--Until such time as the 

Secretary issues final regulations under subsection (d)(1)(B) with 

respect to property which is part of a lighting system--

 ``(1) In general.--The lighting system target under 

 subsection (d)(1)(A)(ii) shall be a reduction in lighting power 

 density of 25 percent (50 percent in the case of a warehouse) of 

 the minimum requirements in Table 9.3.1.1 or Table 9.3.1.2 (not 

 including additional interior lighting power allowances) of 

 Standard 90.1-2001.

 ``(2) Reduction in deduction if reduction less than 40 

 percent.--

 ``(A) In general.--If, with respect to the lighting 

 system of any building other than a warehouse, the 

 reduction in lighting power density of the lighting 

 system is not at least 40 percent, only the applicable 

 percentage of the amount of deduction otherwise 

 allowable under this section with respect to such 

 property shall be allowed.

 ``(B) Applicable percentage.--For purposes of 

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 subparagraph (A), the applicable percentage is the 

 number of percentage points (not greater than 100) equal 

 to the sum of--

 ``(i) 50, and

 ``(ii) the amount which bears the same ratio 

 to 50 as the excess of the reduction of lighting 

 power density of the lighting system over 25 

 percentage points bears to 15.

 ``(C) Exceptions.--This subsection shall not apply 

 to any system--

 ``(i) the controls and circuiting of which do 

 not comply fully with the mandatory and 

 prescriptive requirements of Standard 90.1-2001 

 and which do not include provision for bilevel 

 switching in all occupancies except hotel and 

 motel guest rooms, store rooms, restrooms, and 

 public lobbies, or

 ``(ii) which does not meet the minimum 

 requirements for calculated lighting levels as set 

 forth in the Illuminating Engineering Society of 

 North America Lighting Handbook, Performance and 

 Application, Ninth Edition, 2000.

 ``(g) Regulations.--The Secretary shall promulgate such regulations 

as necessary--

 ``(1) to take into account new technologies regarding energy 

 efficiency and renewable energy for purposes of determining 

 energy efficiency and savings under this section, and

 ``(2) to provide for a recapture of the deduction allowed 

 under this section if the plan described in subsection (c)(1)(D) 

 or (d)(1)(A) is not fully implemented.

 ``(h) Termination.--This section shall not apply with respect to 

property placed in service after December 31, 2007.''.

 (b) Conforming Amendments.--

 (1) Section 1016(a) is amended by striking ``and'' at the 

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

 paragraph (31) and inserting ``, and'', and by adding at the end 

 the following new paragraph:

 ``(32) to the extent provided in section 179D(e).''.

[[Page 119 STAT. 1024]]

 (2) Section 1245(a), as amended by this Act, is amended by 

 inserting ``179D,'' after ``179C,'' both places it appears in 

 paragraphs (2)(C) and (3)(C).

 (3) Section 1250(b)(3) is amended by inserting before the 

 period at the end of the first sentence ``or by section 179D''.

 (4) Section 263(a)(1), as amended by this Act, is amended by 

 striking ``or'' at the end of subparagraph (I), by striking the 

 period at the end of subparagraph (J) and inserting ``, or'', 

 and by inserting after subparagraph (J) the following new 

 subparagraph:

 ``(K) expenditures for which a deduction is allowed 

 under section 179D.''.

 (5) Section 312(k)(3)(B), as amended by this Act, is amended 

 by striking ``179, 179A, 179B, or 179C'' each place it appears 

 in the heading and text and inserting ``179, 179A, 179B, 179C, 

 or 179D''.

 (c) Clerical Amendment.--The table of sections for part VI of 

subchapter B of chapter 1, as amended by this Act, is amended by 

inserting after section 179C the following new item:

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 ``Sec. 179D. Energy efficient commercial buildings deduction.''.

 (d) Effective Date.--The <<NOTE: 26 USC 179D note.>> amendments made 

by this section shall apply to property placed in service after December 

31, 2005.

SEC. 1332. CREDIT FOR CONSTRUCTION OF NEW ENERGY EFFICIENT HOMES.

 (a) In General.--Subpart D of part IV of subchapter A of chapter 1 

(relating to business related credits), as amended by this Act, is 

amended by adding at the end the following new section:

``SEC. 45L. NEW ENERGY EFFICIENT HOME CREDIT.

 ``(a) Allowance of Credit.--

 ``(1) In general.--For purposes of section 38, in the case 

 of an eligible contractor, the new energy efficient home credit 

 for the taxable year is the applicable amount for each qualified 

 new energy efficient home which is--

 ``(A) constructed by the eligible contractor, and

 ``(B) acquired by a person from such eligible 

 contractor for use as a residence during the taxable 

 year.

 ``(2) Applicable amount.--For purposes of paragraph (1), the 

 applicable amount is an amount equal to--

 ``(A) in the case of a dwelling unit described in 

 paragraph (1) or (2) of subsection (c), $2,000, and

 ``(B) in the case of a dwelling unit described in 

 paragraph (3) of subsection (c), $1,000.

 ``(b) Definitions.--For purposes of this section--

 ``(1) Eligible contractor.--The term `eligible contractor' 

 means--

 ``(A) the person who constructed the qualified new 

 energy efficient home, or

 ``(B) in the case of a qualified new energy 

 efficient home which is a manufactured home, the 

 manufactured home producer of such home.

 ``(2) Qualified new energy efficient home.--The term 

 `qualified new energy efficient home' means a dwelling unit--

 ``(A) located in the United States,

[[Page 119 STAT. 1025]]

 ``(B) the construction of which is substantially 

 completed after the date of the enactment of this 

 section, and

 ``(C) which meets the energy saving requirements of 

 subsection (c).

 ``(3) Construction.--The term `construction' includes 

 substantial reconstruction and rehabilitation.

 ``(4) Acquire.--The term `acquire' includes purchase.

 ``(c) Energy Saving Requirements.--A dwelling unit meets the energy 

saving requirements of this subsection if such unit is--

 ``(1) certified--

 ``(A) to have a level of annual heating and cooling 

 energy consumption which is at least 50 percent below 

 the annual level of heating and cooling energy 

 consumption of a comparable dwelling unit--

 ``(i) which is constructed in accordance with 

 the standards of chapter 4 of the 2003 

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 International Energy Conservation Code, as such 

 Code (including supplements) is in effect on the 

 date of the enactment of this section, and

 ``(ii) for which the heating and cooling 

 equipment efficiencies correspond to the minimum 

 allowed under the regulations established by the 

 Department of Energy pursuant to the National 

 Appliance Energy Conservation Act of 1987 and in 

 effect at the time of completion of construction, 

 and

 ``(B) to have building envelope component 

 improvements account for at least \1/5\ of such 50 

 percent,

 ``(2) a manufactured home which conforms to Federal 

 Manufactured Home Construction and Safety Standards (section 

 3280 of title 24, Code of Federal Regulations) and which meets 

 the requirements of paragraph (1), or

 ``(3) a manufactured home which conforms to Federal 

 Manufactured Home Construction and Safety Standards (section 

 3280 of title 24, Code of Federal Regulations) and which--

 ``(A) meets the requirements of paragraph (1) 

 applied by substituting `30 percent' for `50 percent' 

 both places it appears therein and by substituting `\1/

 3\' for `\1/5\' in subparagraph (B) thereof, or

 ``(B) meets the requirements established by the 

 Administrator of the Environmental Protection Agency 

 under the Energy Star Labeled Homes program.

 ``(d) Certification.--

 ``(1) Method of certification.--A certification described in 

 subsection (c) shall be made in accordance with guidance 

 prescribed by the Secretary, after consultation with the 

 Secretary of Energy. Such guidance shall specify procedures and 

 methods for calculating energy and cost savings.

 ``(2) Form.--Any certification described in subsection (c) 

 shall be made in writing in a manner which specifies in readily 

 verifiable fashion the energy efficient building envelope 

 components and energy efficient heating or cooling equipment 

 installed and their respective rated energy efficiency 

 performance.

[[Page 119 STAT. 1026]]

 ``(e) Basis Adjustment.--For purposes of this subtitle, if a credit 

is allowed under this section in connection with any expenditure for any 

property, the increase in the basis of such property which would (but 

for this subsection) result from such expenditure shall be reduced by 

the amount of the credit so determined.

 ``(f) Coordination With Investment Credit.--For purposes of this 

section, expenditures taken into account under section 47 or 48(a) shall 

not be taken into account under this section.

 ``(g) Termination.--This section shall not apply to any qualified 

new energy efficient home acquired after December 31, 2007.''.

 (b) Credit Made Part of General Business Credit.--Section 38(b) 

(relating to current year business credit), as amended by this Act, is 

amended by striking ``plus'' at the end of paragraph (21), by striking 

the period at the end of paragraph (22) and inserting ``, plus'', and by 

adding at the end the following new paragraph:

 ``(23) the new energy efficient home credit determined under 

 section 45L(a).''.

 (c) Basis Adjustment.--Subsection (a) of section 1016, as amended by 

this Act, is amended by striking ``and'' at the end of paragraph (31), 

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by striking the period at the end of paragraph (32) and inserting ``, 

and'', and by adding at the end the following new paragraph:

 ``(33) to the extent provided in section 45L(e), in the case 

 of amounts with respect to which a credit has been allowed under 

 section 45L.''.

 (d) Deduction for Certain Unused Business Credits.--Section 196(c) 

(defining qualified business credits) is amended by striking ``and'' at 

the end of paragraph (11), by striking the period at the end of 

paragraph (12) and inserting ``, and'', and by adding after paragraph 

(12) the following new paragraph:

 ``(13) the new energy efficient home credit determined under 

 section 45L(a).''.

 (e) Clerical Amendment.--The table of sections for subpart D of part 

IV of subchapter A of chapter 1, as amended by this Act, is amended by 

adding at the end the following new item:

 ``Sec. 45L. New energy efficient home credit.''.

 (f) Effective Date.--The <<NOTE: 26 USC 38 note.>> amendments made 

by this section shall apply to qualified new energy efficient homes 

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

date.

SEC. 1333. CREDIT FOR CERTAIN NONBUSINESS ENERGY PROPERTY.

 (a) In General.--Subpart A of part IV of subchapter A of chapter 1 

(relating to nonrefundable personal credits) is amended by inserting 

after section 25B the following new section:

``SEC. 25C. NONBUSINESS ENERGY PROPERTY.

 ``(a) Allowance of Credit.--In the case of an individual, there 

shall be allowed as a credit against the tax imposed by this chapter for 

the taxable year an amount equal to the sum of--

 ``(1) 10 percent of the amount paid or incurred by the 

 taxpayer for qualified energy efficiency improvements installed 

 during such taxable year, and

 ``(2) the amount of the residential energy property 

 expenditures paid or incurred by the taxpayer during such 

 taxable year.

 ``(b) Limitations.--

[[Page 119 STAT. 1027]]

 ``(1) Lifetime limitation.--The credit allowed under this 

 section with respect to any taxpayer for any taxable year shall 

 not exceed the excess (if any) of $500 over the aggregate 

 credits allowed under this section with respect to such taxpayer 

 for all prior taxable years.

 ``(2) Windows.--In the case of amounts paid or incurred for 

 components described in subsection (c)(3)(B) by any taxpayer for 

 any taxable year, the credit allowed under this section with 

 respect to such amounts for such year shall not exceed the 

 excess (if any) of $200 over the aggregate credits allowed under 

 this section with respect to such amounts for all prior taxable 

 years.

 ``(3) Limitation on residential energy property 

 expenditures.--The amount of the credit allowed under this 

 section by reason of subsection (a)(2) shall not exceed--

 ``(A) $50 for any advanced main air circulating fan,

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 ``(B) $150 for any qualified natural gas, propane, 

 or oil furnace or hot water boiler, and

 ``(C) $300 for any item of energy-efficient building 

 property.

 ``(c) Qualified Energy Efficiency Improvements.--For purposes of 

this section--

 ``(1) In general.--The term `qualified energy efficiency 

 improvements' means any energy efficient building envelope 

 component which meets the prescriptive criteria for such 

 component established by the 2000 International Energy 

 Conservation Code, as such Code (including supplements) is in 

 effect on the date of the enactment of this section (or, in the 

 case of a metal roof with appropriate pigmented coatings which 

 meet the Energy Star program requirements), if--

 ``(A) such component is installed in or on a 

 dwelling unit located in the United States and owned and 

 used by the taxpayer as the taxpayer's principal 

 residence (within the meaning of section 121),

 ``(B) the original use of such component commences 

 with the taxpayer, and

 ``(C) such component reasonably can be expected to 

 remain in use for at least 5 years.

 ``(2) Building envelope component.--The term `building 

 envelope component' means--

 ``(A) any insulation material or system which is 

 specifically and primarily designed to reduce the heat 

 loss or gain of a dwelling unit when installed in or on 

 such dwelling unit,

 ``(B) exterior windows (including skylights),

 ``(C) exterior doors, and

 ``(D) any metal roof installed on a dwelling unit, 

 but only if such roof has appropriate pigmented coatings 

 which are specifically and primarily designed to reduce 

 the heat gain of such dwelling unit.

 ``(3) Manufactured homes included.--The term `dwelling unit' 

 includes a manufactured home which conforms to Federal 

 Manufactured Home Construction and Safety Standards (section 

 3280 of title 24, Code of Federal Regulations).

 ``(d) Residential Energy Property Expenditures.--For purposes of 

this section--

[[Page 119 STAT. 1028]]

 ``(1) In general.--The term `residential energy property 

 expenditures' means expenditures made by the taxpayer for 

 qualified energy property which is--

 ``(A) installed on or in connection with a dwelling 

 unit located in the United States and owned and used by 

 the taxpayer as the taxpayer's principal residence 

 (within the meaning of section 121), and

 ``(B) originally placed in service by the taxpayer.

 Such term includes expenditures for labor costs properly 

 allocable to the onsite preparation, assembly, or original 

 installation of the property.

 ``(2) Qualified energy property.--

 ``(A) In general.--The term `qualified energy 

 property' means--

 ``(i) energy-efficient building property,

 ``(ii) a qualified natural gas, propane, or 

 oil furnace or hot water boiler, or

 ``(iii) an advanced main air circulating fan.

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 ``(B) Performance and quality standards.--Property 

 described under subparagraph (A) shall meet the 

 performance and quality standards, and the certification 

 requirements (if any), which--

 ``(i) have been prescribed by the Secretary by 

 regulations (after consultation with the Secretary 

 of Energy or the Administrator of the 

 Environmental Protection Agency, as appropriate), 

 and

 ``(ii) are in effect at the time of the 

 acquisition of the property, or at the time of the 

 completion of the construction, reconstruction, or 

 erection of the property, as the case may be.

 ``(C) Requirements for standards.--The standards and 

 requirements prescribed by the Secretary under 

 subparagraph (B)--

 ``(i) in the case of the energy efficiency 

 ratio (EER) for central air conditioners and 

 electric heat pumps--

 ``(I) shall require measurements to 

 be based on published data which is 

 tested by manufacturers at 95 degrees 

 Fahrenheit, and

 ``(II) may be based on the certified 

 data of the Air Conditioning and 

 Refrigeration Institute that are 

 prepared in partnership with the 

 Consortium for Energy Efficiency, and

 ``(ii) in the case of geothermal heat pumps--

 ``(I) shall be based on testing 

 under the conditions of ARI/ISO Standard 

 13256-1 for Water Source Heat Pumps or 

 ARI 870 for Direct Expansion GeoExchange 

 Heat Pumps (DX), as appropriate, and

 ``(II) shall include evidence that 

 water heating services have been 

 provided through a desuperheater or 

 integrated water heating system 

 connected to the storage water heater 

 tank.

 ``(3) Energy-efficient building property.--The term `energy-

 efficient building property' means--

 ``(A) an electric heat pump water heater which 

 yields an energy factor of at least 2.0 in the standard 

 Department of Energy test procedure,

[[Page 119 STAT. 1029]]

 ``(B) an electric heat pump which has a heating 

 seasonal performance factor (HSPF) of at least 9, a 

 seasonal energy efficiency ratio (SEER) of at least 15, 

 and an energy efficiency ratio (EER) of at least 13,

 ``(C) a geothermal heat pump which--

 ``(i) in the case of a closed loop product, 

 has an energy efficiency ratio (EER) of at least 

 14.1 and a heating coefficient of performance 

 (COP) of at least 3.3,

 ``(ii) in the case of an open loop product, 

 has an energy efficiency ratio (EER) of at least 

 16.2 and a heating coefficient of performance 

 (COP) of at least 3.6, and

 ``(iii) in the case of a direct expansion (DX) 

 product, has an energy efficiency ratio (EER) of 

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 at least 15 and a heating coefficient of 

 performance (COP) of at least 3.5,

 ``(D) a central air conditioner which achieves the 

 highest efficiency tier established by the Consortium 

 for Energy Efficiency, as in effect on January 1, 2006, 

 and

 ``(E) a natural gas, propane, or oil water heater 

 which has an energy factor of at least 0.80.

 ``(4) Qualified natural gas, propane, or oil furnace or hot 

 water boiler.--The term `qualified natural gas, propane, or oil 

 furnace or hot water boiler' means a natural gas, propane, or 

 oil furnace or hot water boiler which achieves an annual fuel 

 utilization efficiency rate of not less than 95.

 ``(5) Advanced main air circulating fan.--The term `advanced 

 main air circulating fan' means a fan used in a natural gas, 

 propane, or oil furnace and which has an annual electricity use 

 of no more than 2 percent of the total annual energy use of the 

 furnace (as determined in the standard Department of Energy test 

 procedures).

 ``(e) Special Rules.--For purposes of this section--

 ``(1) Application of rules.--Rules similar to the rules 

 under paragraphs (4), (5), (6), (7), (8), and (9) of section 

 25D(e) shall apply.

 ``(2) Joint ownership of energy items.--

 ``(A) In general.--Any expenditure otherwise 

 qualifying as an expenditure under this section shall 

 not be treated as failing to so qualify merely because 

 such expenditure was made with respect to two or more 

 dwelling units.

 ``(B) Limits applied separately.--In the case of any 

 expenditure described in subparagraph (A), the amount of 

 the credit allowable under subsection (a) shall (subject 

 to paragraph (1)) be computed separately with respect to 

 the amount of the expenditure made for each dwelling 

 unit.

 ``(f) Basis Adjustments.--For purposes of this subtitle, if a credit 

is allowed under this section for any expenditure with respect to any 

property, the increase in the basis of such property which would (but 

for this subsection) result from such expenditure shall be reduced by 

the amount of the credit so allowed.

 ``(g) Termination.--This section shall not apply with respect to any 

property placed in service after December 31, 2007.''.

 (b) Conforming Amendments.--

[[Page 119 STAT. 1030]]

 (1) Subsection (a) of section 1016, as amended by this Act, 

 is amended by striking ``and'' at the end of paragraph (32), by 

 striking the period at the end of paragraph (33) and inserting 

 ``, and'', and by adding at the end the following new paragraph:

 ``(34) to the extent provided in section 25C(e), in the case 

 of amounts with respect to which a credit has been allowed under 

 section 25C.''.

 (2) The table of sections for subpart A of part IV of 

 subchapter A of chapter 1 is amended by inserting after the item 

 relating to section 25B the following new item:

 ``Sec. 25C. Nonbusiness energy property.''.

 (c) Effective Dates.--The <<NOTE: 26 USC 25C note.>> amendments made 

by this section shall apply to property placed in service after December 

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31, 2005.

SEC. 1334. CREDIT FOR ENERGY EFFICIENT APPLIANCES.

 (a) In General.--Subpart D of part IV of subchapter A of chapter 1 

(relating to business-related credits), as amended by this Act, is 

amended by adding at the end the following new section:

``SEC. 45M. ENERGY EFFICIENT APPLIANCE CREDIT.

 ``(a) General Rule.--

 ``(1) In general.--For purposes of section 38, the energy 

 efficient appliance credit determined under this section for any 

 taxable year is an amount equal to the sum of the credit amounts 

 determined under paragraph (2) for each type of qualified energy 

 efficient appliance produced by the taxpayer during the calendar 

 year ending with or within the taxable year.

 ``(2) Credit amounts.--The credit amount determined for any 

 type of qualified energy efficient appliance is--

 ``(A) the applicable amount determined under 

 subsection (b) with respect to such type, multiplied by

 ``(B) the eligible production for such type.

 ``(b) Applicable Amount.--

 ``(1) In general.--For purposes of subsection (a)--

 ``(A) Dishwashers.--The applicable amount is the 

 energy savings amount in the case of a dishwasher 

 which--

 ``(i) is manufactured in calendar year 2006 or 

 2007, and

 ``(ii) meets the requirements of the Energy 

 Star program which are in effect for dishwashers 

 in 2007.

 ``(B) Clothes washers.--The applicable amount is 

 $100 in the case of a clothes washer which--

 ``(i) is manufactured in calendar year 2006 or 

 2007, and

 ``(ii) meets the requirements of the Energy 

 Star program which are in effect for clothes 

 washers in 2007.

 ``(C) Refrigerators.--

 ``(i) 15 percent savings.--The applicable 

 amount is $75 in the case of a refrigerator 

 which--

 ``(I) is manufactured in calendar 

 year 2006, and

 ``(II) consumes at least 15 percent 

 but not more than 20 percent less 

 kilowatt hours per year than the 2001 

 energy conservation standards.

[[Page 119 STAT. 1031]]

 ``(ii) 20 percent savings.--The applicable 

 amount is $125 in the case of a refrigerator 

 which--

 ``(I) is manufactured in calendar 

 year 2006 or 2007, and

 ``(II) consumes at least 20 percent 

 but not more than 25 percent less 

 kilowatt hours per year than the 2001 

 energy conservation standards.

 ``(iii) 25 percent savings.--The applicable 

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 amount is $175 in the case of a refrigerator 

 which--

 ``(I) is manufactured in calendar 

 year 2006 or 2007, and

 ``(II) consumes at least 25 percent 

 less kilowatt hours per year than the 

 2001 energy conservation standards.

 ``(2) Energy savings amount.--For purposes of paragraph 

 (1)(A)--

 ``(A) In general.--The energy savings amount is the 

 lesser of--

 ``(i) the product of--

 ``(I) $3, and

 ``(II) 100 multiplied by the energy 

 savings percentage, or

 ``(ii) $100.

 ``(B) Energy savings percentage.--For purposes of 

 subparagraph (A), the energy savings percentage is the 

 ratio of--

 ``(i) the EF required by the Energy Star 

 program for dishwashers in 2007 minus the EF 

 required by the Energy Star program for 

 dishwashers in 2005, to

 ``(ii) the EF required by the Energy Star 

 program for dishwashers in 2007.

 ``(c) Eligible Production.--

 ``(1) In general.--Except as provided in paragraphs (2), the 

 eligible production in a calendar year with respect to each type 

 of energy efficient appliance is the excess of--

 ``(A) the number of appliances of such type which 

 are produced by the taxpayer in the United States during 

 such calendar year, over

 ``(B) the average number of appliances of such type 

 which were produced by the taxpayer (or any predecessor) 

 in the United States during the preceding 3-calendar 

 year period.

 ``(2) Special rule for refrigerators.--The eligible 

 production in a calendar year with respect to each type of 

 refrigerator described in subsection (b)(1)(C) is the excess 

 of--

 ``(A) the number of appliances of such type which 

 are produced by the taxpayer in the United States during 

 such calendar year, over

 ``(B) 110 percent of the average number of 

 appliances of such type which were produced by the 

 taxpayer (or any predecessor) in the United States 

 during the preceding 3-calendar year period.

 ``(d) Types of Energy Efficient Appliance.--For purposes of this 

section, the types of energy efficient appliances are--

 ``(1) dishwashers described in subsection (b)(1)(A),

 ``(2) clothes washers described in subsection (b)(1)(B),

[[Page 119 STAT. 1032]]

 ``(3) refrigerators described in subsection (b)(1)(C)(i),

 ``(4) refrigerators described in subsection (b)(1)(C)(ii), 

 and

 ``(5) refrigerators described in subsection (b)(1)(C)(iii).

 ``(e) Limitations.--

 ``(1) Aggregate credit amount allowed.--The aggregate amount 

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 of credit allowed under subsection (a) with respect to a 

 taxpayer for any taxable year shall not exceed $75,000,000 

 reduced by the amount of the credit allowed under subsection (a) 

 to the taxpayer (or any predecessor) for all prior taxable 

 years.

 ``(2) Amount allowed for 15 percent savings refrigerators.--

 In the case of refrigerators described in subsection 

 (b)(1)(C)(i), the aggregate amount of the credit allowed under 

 subsection (a) with respect to a taxpayer for any taxable year 

 shall not exceed $20,000,000.

 ``(3) Limitation based on gross receipts.--The credit 

 allowed under subsection (a) with respect to a taxpayer for the 

 taxable year shall not exceed an amount equal to 2 percent of 

 the average annual gross receipts of the taxpayer for the 3 

 taxable years preceding the taxable year in which the credit is 

 determined.

 ``(4) Gross receipts.--For <<NOTE: Applicability.>> purposes 

 of this subsection, the rules of paragraphs (2) and (3) of 

 section 448(c) shall apply.

 ``(f) Definitions.--For purposes of this section--

 ``(1) Qualified energy efficient appliance.--The term 

 `qualified energy efficient appliance' means--

 ``(A) any dishwasher described in subsection 

 (b)(1)(A),

 ``(B) any clothes washer described in subsection 

 (b)(1)(B), and

 ``(C) any refrigerator described in subsection 

 (b)(1)(C).

 ``(2) Dishwasher.--The term `dishwasher' means a residential 

 dishwasher subject to the energy conservation standards 

 established by the Department of Energy.

 ``(3) Clothes washer.--The term `clothes washer' means a 

 residential model clothes washer, including a residential style 

 coin operated washer.

 ``(4) Refrigerator.--The term `refrigerator' means a 

 residential model automatic defrost refrigerator-freezer which 

 has an internal volume of at least 16.5 cubic feet.

 ``(5) EF.--The term `EF' means the energy factor established 

 by the Department of Energy for compliance with the Federal 

 energy conservation standards.

 ``(6) Produced.--The term `produced' includes manufactured.

 ``(7) 2001 energy conservation standard.--The term `2001 

 energy conservation standard' means the energy conservation 

 standards promulgated by the Department of Energy and effective 

 July 1, 2001.

 ``(g) Special Rules.--For purposes of this section--

 ``(1) In general.--Rules <<NOTE: Applicability.>> similar to 

 the rules of subsections (c), (d), and (e) of section 52 shall 

 apply.

 ``(2) Controlled group.--

 ``(A) In general.--All persons treated as a single 

 employer under subsection (a) or (b) of section 52 or 

 subsection (m) or (o) of section 414 shall be treated as 

 a single producer.

[[Page 119 STAT. 1033]]

 ``(B) Inclusion of <<NOTE: Applicability.>> foreign 

 corporations.--For purposes of subparagraph (A), in 

 applying subsections (a) and (b) of section 52 to this 

 section, section 1563 shall be applied without regard to 

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 subsection (b)(2)(C) thereof.

 ``(3) Verification.--No amount shall be allowed as a credit 

 under subsection (a) with respect to which the taxpayer has not 

 submitted such information or certification as the Secretary, in 

 consultation with the Secretary of Energy, determines 

 necessary.''.

 (b) Conforming Amendment.--Section 38(b) (relating to general 

business credit), as amended by this Act, is amended by striking 

``plus'' at the end of paragraph (22), by striking the period at the end 

of paragraph (23) and inserting ``, plus'', and by adding at the end the 

following new paragraph:

 ``(24) the energy efficient appliance credit determined 

 under section 45M(a).''.

 (c) Clerical Amendment.--The table of sections for subpart D of part 

IV of subchapter A of chapter 1, as amended by this Act, is amended by 

adding at the end the following new item:

 ``Sec. 45M. Energy efficient appliance credit.''.

 (d) Effective Date.--The <<NOTE: 26 USC 38 note.>> amendments made 

by this section shall apply to appliances produced after December 31, 

2005.

SEC. 1335. CREDIT FOR RESIDENTIAL ENERGY EFFICIENT PROPERTY.

 (a) In General.--Subpart A of part IV of subchapter A of chapter 1 

(relating to nonrefundable personal credits), as amended by this Act, is 

amended by inserting after section 25C the following new section:

``SEC. 25D. RESIDENTIAL ENERGY EFFICIENT PROPERTY.

 ``(a) Allowance of Credit.--In the case of an individual, there 

shall be allowed as a credit against the tax imposed by this chapter for 

the taxable year an amount equal to the sum of--

 ``(1) 30 percent of the qualified photovoltaic property 

 expenditures made by the taxpayer during such year,

 ``(2) 30 percent of the qualified solar water heating 

 property expenditures made by the taxpayer during such year, and

 ``(3) 30 percent of the qualified fuel cell property 

 expenditures made by the taxpayer during such year.

 ``(b) Limitations.--

 ``(1) Maximum credit.--The credit allowed under subsection 

 (a) for any taxable year shall not exceed--

 ``(A) $2,000 with respect to any qualified 

 photovoltaic property expenditures,

 ``(B) $2,000 with respect to any qualified solar 

 water heating property expenditures, and

 ``(C) $500 with respect to each half kilowatt of 

 capacity of qualified fuel cell property (as defined in 

 section 48(c)(1)) for which qualified fuel cell property 

 expenditures are made.

 ``(2) Certification of solar water heating property.--No 

 credit shall be allowed under this section for an item of 

 property described in subsection (d)(1) unless such property is 

 certified for performance by the non-profit Solar Rating 

 Certification Corporation or a comparable entity endorsed by the 

 government of the State in which such property is installed.

[[Page 119 STAT. 1034]]

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 ``(c) Carryforward of Unused Credit.--If the credit allowable under 

subsection (a) exceeds the limitation imposed by section 26(a) for such 

taxable year reduced by the sum of the credits allowable under this 

subpart (other than this section), such excess shall be carried to the 

succeeding taxable year and added to the credit allowable under 

subsection (a) for such succeeding taxable year.

 ``(d) Definitions.--For purposes of this section--

 ``(1) Qualified solar water heating property expenditure.--

 The term `qualified solar water heating property expenditure' 

 means an expenditure for property to heat water for use in a 

 dwelling unit located in the United States and used as a 

 residence by the taxpayer if at least half of the energy used by 

 such property for such purpose is derived from the sun.

 ``(2) Qualified photovoltaic property expenditure.--The term 

 `qualified photovoltaic property expenditure' means an 

 expenditure for property which uses solar energy to generate 

 electricity for use in a dwelling unit located in the United 

 States and used as a residence by the taxpayer.

 ``(3) Qualified fuel cell property expenditure.--The term 

 `qualified fuel cell property expenditure' means an expenditure 

 for qualified fuel cell property (as defined in section 

 48(c)(1)) installed on or in connection with a dwelling unit 

 located in the United States and used as a principal residence 

 (within the meaning of section 121) by the taxpayer.

 ``(e) Special Rules.--For purposes of this section--

 ``(1) Labor costs.--Expenditures for labor costs properly 

 allocable to the onsite preparation, assembly, or original 

 installation of the property described in subsection (d) and for 

 piping or wiring to interconnect such property to the dwelling 

 unit shall be taken into account for purposes of this section.

 ``(2) Solar panels.--No expenditure relating to a solar 

 panel or other property installed as a roof (or portion thereof) 

 shall fail to be treated as property described in paragraph (1) 

 or (2) of subsection (d) solely because it constitutes a 

 structural component of the structure on which it is installed.

 ``(3) Swimming pools, etc., used as storage medium.--

 Expenditures which are properly allocable to a swimming pool, 

 hot tub, or any other energy storage medium which has a function 

 other than the function of such storage shall not be taken into 

 account for purposes of this section.

 ``(4) Dollar amounts in case of joint occupancy.--In the 

 case of any dwelling unit which is jointly occupied and used 

 during any calendar year as a residence by two or more 

 individuals the following rules shall apply:

 ``(A) The amount of the credit allowable, under 

 subsection (a) by reason of expenditures (as the case 

 may be) made during such calendar year by any of such 

 individuals with respect to such dwelling unit shall be 

 determined by treating all of such individuals as 1 

 taxpayer whose taxable year is such calendar year.

 ``(B) There shall be allowable, with respect to such 

 expenditures to each of such individuals, a credit under 

 subsection (a) for the taxable year in which such 

 calendar year ends in an amount which bears the same 

 ratio to

[[Page 119 STAT. 1035]]

 the amount determined under subparagraph (A) as the 

 amount of such expenditures made by such individual 

 during such calendar year bears to the aggregate of such 

 expenditures made by all of such individuals during such 

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 calendar year.

 ``(C) Subparagraphs (A) and 

 (B) <<NOTE: Applicability.>> shall be applied separately 

 with respect to expenditures described in paragraphs 

 (1), (2), and (3) of subsection (d).

 ``(5) Tenant-stockholder in cooperative housing 

 corporation.--In the case of an individual who is a tenant-

 stockholder (as defined in section 216) in a cooperative housing 

 corporation (as defined in such section), such individual shall 

 be treated as having made his tenant-stockholder's proportionate 

 share (as defined in section 216(b)(3)) of any expenditures of 

 such corporation.

 ``(6) Condominiums.--

 ``(A) In general.--In the case of an individual who 

 is a member of a condominium management association with 

 respect to a condominium which the individual owns, such 

 individual shall be treated as having made the 

 individual's proportionate share of any expenditures of 

 such association.

 ``(B) Condominium management association.--For 

 purposes of this paragraph, the term `condominium 

 management association' means an organization which 

 meets the requirements of paragraph (1) of section 

 528(c) (other than subparagraph (E) thereof) with 

 respect to a condominium project substantially all of 

 the units of which are used as residences.

 ``(7) Allocation in certain cases.--If less than 80 percent 

 of the use of an item is for nonbusiness purposes, only that 

 portion of the expenditures for such item which is properly 

 allocable to use for nonbusiness purposes shall be taken into 

 account.

 ``(8) When expenditure made; amount of expenditure.--

 ``(A) In general.--Except as provided in 

 subparagraph (B), an expenditure with respect to an item 

 shall be treated as made when the original installation 

 of the item is completed.

 ``(B) Expenditures part of building construction.--

 In the case of an expenditure in connection with the 

 construction or reconstruction of a structure, such 

 expenditure shall be treated as made when the original 

 use of the constructed or reconstructed structure by the 

 taxpayer begins.

 ``(9) Property financed by subsidized energy financing.--For 

 purposes of determining the amount of expenditures made by any 

 individual with respect to any dwelling unit, there shall not be 

 taken into account expenditures which are made from subsidized 

 energy financing (as defined in section 48(a)(4)(C)).

 ``(f) Basis Adjustments.--For purposes of this subtitle, if a credit 

is allowed under this section for any expenditure with respect to any 

property, the increase in the basis of such property which would (but 

for this subsection) result from such expenditure shall be reduced by 

the amount of the credit so allowed.

[[Page 119 STAT. 1036]]

 ``(g) Termination.--The credit allowed under this section shall not 

apply to property placed in service after December 31, 2007.''.

 (b) Conforming Amendments.--

 (1) Section 23(c) is amended by striking ``this section and 

 section 1400C'' and inserting ``this section, section 25D, and 

 section 1400C''.

 (2) Section 25(e)(1)(C) is amended by striking ``this 

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 section and sections 23 and 1400C'' and inserting ``other than 

 this section, section 23, section 25D, and section 1400C''.

 (3) Section 1400C(d) is amended by striking ``this section'' 

 and inserting ``this section and section 25D''.

 (4) Section 1016(a), as amended by this Act, is amended by 

 striking ``and'' at the end of paragraph (33), by striking the 

 period at the end of paragraph (34) and inserting ``, and'', and 

 by adding at the end the following new paragraph:

 ``(35) to the extent provided in section 25D(f), in the case 

 of amounts with respect to which a credit has been allowed under 

 section 25D.''.

 (5) The table of sections for subpart A of part IV of 

 subchapter A of chapter 1, as amended by this Act, is amended by 

 inserting after the item relating to section 25C the following 

 new item:

 ``Sec. 25D. Residential energy efficient property.''.

 (c) Effective Dates.--The <<NOTE: 26 USC 23 note.>> amendments made 

by this section shall apply to property placed in service after December 

31, 2005, in taxable years ending after such date.

SEC. 1336. CREDIT FOR BUSINESS INSTALLATION OF QUALIFIED FUEL CELLS AND 

 STATIONARY MICROTURBINE POWER PLANTS.

 (a) In General.--Section 48(a)(3)(A) (defining energy property) is 

amended by striking ``or'' at the end of clause (i), by adding ``or'' at 

the end of clause (ii), and by inserting after clause (ii) the following 

new clause:

 ``(iii) qualified fuel cell property or 

 qualified microturbine property,''.

 (b) Qualified Fuel Cell Property; Qualified Microturbine Property.--

Section 48 (relating to energy credit) is amended by adding at the end 

the following new subsection:

 ``(c) Qualified Fuel Cell Property; Qualified Microturbine 

Property.--For purposes of this subsection--

 ``(1) Qualified fuel cell property.--

 ``(A) In general.--The term `qualified fuel cell 

 property' means a fuel cell power plant which--

 ``(i) has a nameplate capacity of at least 0.5 

 kilowatt of electricity using an electrochemical 

 process, and

 ``(ii) has an electricity-only generation 

 efficiency greater than 30 percent.

 ``(B) Limitation.--In the case of qualified fuel 

 cell property placed in service during the taxable year, 

 the credit otherwise determined under paragraph (1) for 

 such year with respect to such property shall not exceed 

 an amount equal to $500 for each 0.5 kilowatt of 

 capacity of such property.

 ``(C) Fuel cell power plant.--The term `fuel cell 

 power plant' means an integrated system comprised of

[[Page 119 STAT. 1037]]

 a fuel cell stack assembly and associated balance of 

 plant components which converts a fuel into electricity 

 using electrochemical means.

 ``(D) Special rule.--The first sentence of the 

 matter in subsection (a)(3) which follows subparagraph 

 (D) thereof shall not apply to qualified fuel cell 

 property which is used predominantly in the trade or 

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 business of the furnishing or sale of telephone service, 

 telegraph service by means of domestic telegraph 

 operations, or other telegraph services (other than 

 international telegraph services).

 ``(E) Termination.--The term `qualified fuel cell 

 property' shall not include any property for any period 

 after December 31, 2007.

 ``(2) Qualified microturbine property.--

 ``(A) In general.--The term `qualified microturbine 

 property' means a stationary microturbine power plant 

 which--

 ``(i) has a nameplate capacity of less than 

 2,000 kilowatts, and

 ``(ii) has an electricity-only generation 

 efficiency of not less than 26 percent at 

 International Standard Organization conditions.

 ``(B) Limitation.--In the case of qualified 

 microturbine property placed in service during the 

 taxable year, the credit otherwise determined under 

 paragraph (1) for such year with respect to such 

 property shall not exceed an amount equal $200 for each 

 kilowatt of capacity of such property.

 ``(C) Stationary microturbine power plant.--The term 

 `stationary microturbine power plant' means an 

 integrated system comprised of a gas turbine engine, a 

 combustor, a recuperator or regenerator, a generator or 

 alternator, and associated balance of plant components 

 which converts a fuel into electricity and thermal 

 energy. Such term also includes all secondary components 

 located between the existing infrastructure for fuel 

 delivery and the existing infrastructure for power 

 distribution, including equipment and controls for 

 meeting relevant power standards, such as voltage, 

 frequency, and power factors.

 ``(D) Special rule.--The first sentence of the 

 matter in subsection (a)(3) which follows subparagraph 

 (D) thereof shall not apply to qualified microturbine 

 property which is used predominantly in the trade or 

 business of the furnishing or sale of telephone service, 

 telegraph service by means of domestic telegraph 

 operations, or other telegraph services (other than 

 international telegraph services).

 ``(E) Termination.--The term `qualified microturbine 

 property' shall not include any property for any period 

 after December 31, 2007.''.

 (c) Energy Percentage.--Section 48(a)(2)(A) (relating to energy 

percentage) is amended to read as follows:

 ``(A) In general.--The energy percentage is--

 ``(i) in the case of qualified fuel cell 

 property, 30 percent, and

 ``(ii) in the case of any other energy 

 property, 10 percent.''.

[[Page 119 STAT. 1038]]

 (d) Conforming Amendment.--Section 48(a)(1) is amended by inserting 

``except as provided in paragraph (1)(B) or (2)(B) of subsection (d),'' 

before ``the energy''.

 (e) Effective Date.--The <<NOTE: 26 USC 48 note.>> amendments made 

by this section shall apply to periods after December 31, 2005, in 

taxable years ending after such date, under rules similar to the rules 

of section 48(m) of the Internal Revenue Code of 1986 (as in effect on 

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the day before the date of the enactment of the Revenue Reconciliation 

Act of 1990).

SEC. 1337. BUSINESS SOLAR INVESTMENT TAX CREDIT.

 (a) Increase in Energy Percentage.--Section 48(a)(2)(A) (relating to 

energy percentage), as amended by this Act, is amended to read as 

follows:

 ``(A) In general.--The energy percentage is--

 ``(i) 30 percent in the case of--

 ``(I) qualified fuel cell property,

 ``(II) energy property described in 

 paragraph (3)(A)(i) but only with 

 respect to periods ending before January 

 1, 2008, and

 ``(III) energy property described in 

 paragraph (3)(A)(ii), and

 ``(ii) in the case of any energy property to 

 which clause (i) does not apply, 10 percent.''.

 (b) Hybrid Solar Lighting Systems.--Subparagraph (A) of section 

48(a)(3) is amended by striking ``or'' at the end of clause (i), by 

redesignating clause (ii) as clause (iii), and by inserting after clause 

(i) the following new clause:

 ``(ii) equipment which uses solar energy to 

 illuminate the inside of a structure using fiber-

 optic distributed sunlight but only with respect 

 to periods ending before January 1, 2008, or''.

 (c) Limitation on Use of Solar Energy to Heat Swimming Pools.--

Clause (i) of section 48(a)(3)(A) is amended by inserting ``excepting 

property used to generate energy for the purposes of heating a swimming 

pool,'' after ``solar process heat,''.

 (d) Effective Date.--The <<NOTE: 26 USC 48 note.>> amendments made 

by this section shall apply to periods after December 31, 2005, in 

taxable years ending after such date, under rules similar to the rules 

of section 48(m) of the Internal Revenue Code of 1986 (as in effect on 

the day before the date of the enactment of the Revenue Reconciliation 

Act of 1990).

 Subtitle D--Alternative Motor Vehicles and Fuels Incentives

SEC. 1341. ALTERNATIVE MOTOR VEHICLE CREDIT.

 (a) In General.--Subpart B of part IV of subchapter A of chapter 1 

(relating to foreign tax credit, etc.) is amended by adding at the end 

the following new section:

``SEC. 30B. ALTERNATIVE MOTOR VEHICLE CREDIT.

 ``(a) Allowance of Credit.--There shall be allowed as a credit 

against the tax imposed by this chapter for the taxable year an amount 

equal to the sum of--

[[Page 119 STAT. 1039]]

 ``(1) the new qualified fuel cell motor vehicle credit 

 determined under subsection (b),

 ``(2) the new advanced lean burn technology motor vehicle 

 credit determined under subsection (c),

 ``(3) the new qualified hybrid motor vehicle credit 

 determined under subsection (d), and

 ``(4) the new qualified alternative fuel motor vehicle 

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 credit determined under subsection (e).

 ``(b) New Qualified Fuel Cell Motor Vehicle Credit.--

 ``(1) In general.--For purposes of subsection (a), the new 

 qualified fuel cell motor vehicle credit determined under this 

 subsection with respect to a new qualified fuel cell motor 

 vehicle placed in service by the taxpayer during the taxable 

 year is--

 ``(A) $8,000 ($4,000 in the case of a vehicle placed 

 in service after December 31, 2009), if such vehicle has 

 a gross vehicle weight rating of not more than 8,500 

 pounds,

 ``(B) $10,000, if such vehicle has a gross vehicle 

 weight rating of more than 8,500 pounds but not more 

 than 14,000 pounds,

 ``(C) $20,000, if such vehicle has a gross vehicle 

 weight rating of more than 14,000 pounds but not more 

 than 26,000 pounds, and

 ``(D) $40,000, if such vehicle has a gross vehicle 

 weight rating of more than 26,000 pounds.

 ``(2) Increase for fuel efficiency.--

 ``(A) In general.--The amount determined under 

 paragraph (1)(A) with respect to a new qualified fuel 

 cell motor vehicle which is a passenger automobile or 

 light truck shall be increased by--

 ``(i) $1,000, if such vehicle achieves at 

 least 150 percent but less than 175 percent of the 

 2002 model year city fuel economy,

 ``(ii) $1,500, if such vehicle achieves at 

 least 175 percent but less than 200 percent of the 

 2002 model year city fuel economy,

 ``(iii) $2,000, if such vehicle achieves at 

 least 200 percent but less than 225 percent of the 

 2002 model year city fuel economy,

 ``(iv) $2,500, if such vehicle achieves at 

 least 225 percent but less than 250 percent of the 

 2002 model year city fuel economy,

 ``(v) $3,000, if such vehicle achieves at 

 least 250 percent but less than 275 percent of the 

 2002 model year city fuel economy,

 ``(vi) $3,500, if such vehicle achieves at 

 least 275 percent but less than 300 percent of the 

 2002 model year city fuel economy, and

 ``(vii) $4,000, if such vehicle achieves at 

 least 300 percent of the 2002 model year city fuel 

 economy.

 ``(B) 2002 model year city fuel economy.--For 

 purposes of subparagraph (A), the 2002 model year city 

 fuel economy with respect to a vehicle shall be 

 determined in accordance with the following tables:

 ``(i) In the case of a passenger automobile:

[[Page 119 STAT. 1040]]

 The 2002 model year city..................

 ``If vehicle inertiafuel economy is:..........................

 class is:

 1,500 or 1,750 lbs 45.2 mpg 

 2,000 lbs 39.6 mpg 

 2,250 lbs 35.2 mpg 

 2,500 lbs 31.7 mpg 

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 2,750 lbs 28.8 mpg 

 3,000 lbs 26.4 mpg 

 3,500 lbs 22.6 mpg 

 4,000 lbs 19.8 mpg 

 4,500 lbs 17.6 mpg 

 5,000 lbs 15.9 mpg 

 5,500 lbs 14.4 mpg 

 6,000 lbs 13.2 mpg 

 6,500 lbs 12.2 mpg 

 7,000 to 8,500 lbs 11.3 mpg. 

 ``(ii) In the case of a light truck:

 The 2002 model year city..................

 ``If vehicle inertiafuel economy is:..........................

 class is:

 1,500 or 1,750 lbs 39.4 mpg 

 2,000 lbs 35.2 mpg 

 2,250 lbs 31.8 mpg 

 2,500 lbs 29.0 mpg 

 2,750 lbs 26.8 mpg 

 3,000 lbs 24.9 mpg 

 3,500 lbs 21.8 mpg 

 4,000 lbs 19.4 mpg 

 4,500 lbs 17.6 mpg 

 5,000 lbs 16.1 mpg 

 5,500 lbs 14.8 mpg 

 6,000 lbs 13.7 mpg 

 6,500 lbs 12.8 mpg 

 7,000 to 8,500 lbs 12.1 mpg. 

 ``(C) Vehicle inertia weight class.--For purposes of 

 subparagraph (B), the term `vehicle inertia weight 

 class' has the same meaning as when defined in 

 regulations prescribed by the Administrator of the 

 Environmental Protection Agency for purposes of the 

 administration of title II of the Clean Air Act (42 

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

 ``(3) New qualified fuel cell motor vehicle.--For purposes 

 of this subsection, the term `new qualified fuel cell motor 

 vehicle' means a motor vehicle--

 ``(A) which is propelled by power derived from 1 or 

 more cells which convert chemical energy directly into 

 electricity by combining oxygen with hydrogen fuel which 

 is stored on board the vehicle in any form and may or 

 may not require reformation prior to use,

 ``(B) which, in the case of a passenger automobile 

 or light truck, has received on or after the date of the 

 enactment of this section a certificate that such 

 vehicle meets or exceeds the Bin 5 Tier II emission 

 level established in regulations prescribed by the 

 Administrator of the Environmental Protection Agency 

 under section 202(i) of the Clean Air Act for that make 

 and model year vehicle,

 ``(C) the original use of which commences with the 

 taxpayer,

[[Page 119 STAT. 1041]]

 ``(D) which is acquired for use or lease by the 

 taxpayer and not for resale, and

 ``(E) which is made by a manufacturer.

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 ``(c) New Advanced Lean Burn Technology Motor Vehicle Credit.--

 ``(1) In general.--For purposes of subsection (a), the new 

 advanced lean burn technology motor vehicle credit determined 

 under this subsection for the taxable year is the credit amount 

 determined under paragraph (2) with respect to a new advanced 

 lean burn technology motor vehicle placed in service by the 

 taxpayer during the taxable year.

 ``(2) Credit amount.--

 ``(A) Fuel economy.--

 ``(i) In general.--The credit amount 

 determined under this paragraph shall be 

 determined in accordance with the following table:

``In the case of a vehicle whiThe credit amount is--....................

 achieves a fuel economy (expressed 

 as a percentage of the 2002 model 

 year city fuel economy) of--

At least 125 percent but less than 150 $400

 percent

At least 150 percent but less than 175 $800

 percent

At least 175 percent but less than 200 $1,200

 percent

At least 200 percent but less than 225 $1,600

 percent

At least 225 percent but less than 250 $2,000

 percent

At least 250 percent $2,400.

 ``(ii) 2002 model year city fuel economy.--For 

 purposes of clause (i), the 2002 model year city 

 fuel economy with respect to a vehicle shall be 

 determined on a gasoline gallon equivalent basis 

 as determined by the Administrator of the 

 Environmental Protection Agency using the tables 

 provided in subsection (b)(2)(B) with respect to 

 such vehicle.

 ``(B) Conservation credit.--The amount determined 

 under subparagraph (A) with respect to a new advanced 

 lean burn technology motor vehicle shall be increased by 

 the conservation credit amount determined in accordance 

 with the following table:

``In the case of a vehicle whiThe conservation credit amount is--.......

 achieves a lifetime fuel savings 

 (expressed in gallons of gasoline) 

 of--

At least 1,200 but less than 1,800 $250

At least 1,800 but less than 2,400 $500

At least 2,400 but less than 3,000 $750

At least 3,000 $1,000.

 ``(3) New advanced lean burn technology motor vehicle.--For 

 purposes of this subsection, the term `new advanced lean burn 

 technology motor vehicle' means a passenger automobile or a 

 light truck--

 ``(A) with an internal combustion engine which--

 ``(i) is designed to operate primarily using 

 more air than is necessary for complete combustion 

 of the fuel,

 ``(ii) incorporates direct injection,

 ``(iii) achieves at least 125 percent of the 

 2002 model year city fuel economy,

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[[Page 119 STAT. 1042]]

 ``(iv) for 2004 and later model vehicles, has 

 received a certificate that such vehicle meets or 

 exceeds--

 ``(I) in the case of a vehicle 

 having a gross vehicle weight rating of 

 6,000 pounds or less, the Bin 5 Tier II 

 emission standard established in 

 regulations prescribed by the 

 Administrator of the Environmental 

 Protection Agency under section 202(i) 

 of the Clean Air Act for that make and 

 model year vehicle, and

 ``(II) in the case of a vehicle 

 having a gross vehicle weight rating of 

 more than 6,000 pounds but not more than 

 8,500 pounds, the Bin 8 Tier II emission 

 standard which is so established,

 ``(B) the original use of which commences with the 

 taxpayer,

 ``(C) which is acquired for use or lease by the 

 taxpayer and not for resale, and

 ``(D) which is made by a manufacturer.

 ``(4) Lifetime fuel savings.--For purposes of this 

 subsection, the term `lifetime fuel savings' means, in the case 

 of any new advanced lean burn technology motor vehicle, an 

 amount equal to the excess (if any) of--

 ``(A) 120,000 divided by the 2002 model year city 

 fuel economy for the vehicle inertia weight class, over

 ``(B) 120,000 divided by the city fuel economy for 

 such vehicle.

 ``(d) New Qualified Hybrid Motor Vehicle Credit.--

 ``(1) In general.--For purposes of subsection (a), the new 

 qualified hybrid motor vehicle credit determined under this 

 subsection for the taxable year is the credit amount determined 

 under paragraph (2) with respect to a new qualified hybrid motor 

 vehicle placed in service by the taxpayer during the taxable 

 year.

 ``(2) Credit amount.--

 ``(A) Credit amount for passenger automobiles and 

 light trucks.--In the case of a new qualified hybrid 

 motor vehicle which is a passenger automobile or light 

 truck and which has a gross vehicle weight rating of not 

 more than 8,500 pounds, the amount determined under this 

 paragraph is the sum of the amounts determined under 

 clauses (i) and (ii).

 ``(i) Fuel economy.--The amount determined 

 under this clause is the amount which would be 

 determined under subsection (c)(2)(A) if such 

 vehicle were a vehicle referred to in such 

 subsection.

 ``(ii) Conservation credit.--The amount 

 determined under this clause is the amount which 

 would be determined under subsection (c)(2)(B) if 

 such vehicle were a vehicle referred to in such 

 subsection.

 ``(B) Credit amount for other motor vehicles.--

 ``(i) In general.--In the case of any new 

 qualified hybrid motor vehicle to which 

 subparagraph (A) does not apply, the amount 

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 determined under this paragraph is the amount 

 equal to the applicable percentage of the 

 qualified incremental hybrid cost of the vehicle 

 as certified under clause (v).

[[Page 119 STAT. 1043]]

 ``(ii) Applicable percentage.--For purposes of 

 clause (i), the applicable percentage is--

 ``(I) 20 percent if the vehicle 

 achieves an increase in city fuel 

 economy relative to a comparable vehicle 

 of at least 30 percent but less than 40 

 percent,

 ``(II) 30 percent if the vehicle 

 achieves such an increase of at least 40 

 percent but less than 50 percent, and

 ``(III) 40 percent if the vehicle 

 achieves such an increase of at least 50 

 percent.

 ``(iii) Qualified incremental hybrid cost.--

 For purposes of this subparagraph, the qualified 

 incremental hybrid cost of any vehicle is equal to 

 the amount of the excess of the manufacturer's 

 suggested retail price for such vehicle over such 

 price for a comparable vehicle, to the extent such 

 amount does not exceed--

 ``(I) $7,500, if such vehicle has a 

 gross vehicle weight rating of not more 

 than 14,000 pounds,

 ``(II) $15,000, if such vehicle has 

 a gross vehicle weight rating of more 

 than 14,000 pounds but not more than 

 26,000 pounds, and

 ``(III) $30,000, if such vehicle has 

 a gross vehicle weight rating of more 

 than 26,000 pounds.

 ``(iv) Comparable vehicle.--For purposes of 

 this subparagraph, the term `comparable vehicle' 

 means, with respect to any new qualified hybrid 

 motor vehicle, any vehicle which is powered solely 

 by a gasoline or diesel internal combustion engine 

 and which is comparable in weight, size, and use 

 to such vehicle.

 ``(v) Certification.--A certification 

 described in clause (i) shall be made by the 

 manufacturer and shall be determined in accordance 

 with guidance prescribed by the Secretary. Such 

 guidance shall specify procedures and methods for 

 calculating fuel economy savings and incremental 

 hybrid costs.

 ``(3) New qualified hybrid motor vehicle.--For purposes of 

 this subsection--

 ``(A) In general.--The term `new qualified hybrid 

 motor vehicle' means a motor vehicle--

 ``(i) which draws propulsion energy from 

 onboard sources of stored energy which are both--

 ``(I) an internal combustion or heat 

 engine using consumable fuel, and

 ``(II) a rechargeable energy storage 

 system,

 ``(ii) which, in the case of a vehicle to 

 which paragraph (2)(A) applies, has received a 

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 certificate of conformity under the Clean Air Act 

 and meets or exceeds the equivalent qualifying 

 California low emission vehicle standard under 

 section 243(e)(2) of the Clean Air Act for that 

 make and model year, and

 ``(I) in the case of a vehicle 

 having a gross vehicle weight rating of 

 6,000 pounds or less, the Bin 5 Tier II 

 emission standard established in 

 regulations prescribed by the 

 Administrator of the Environmental 

 Protection Agency under section

[[Page 119 STAT. 1044]]

 202(i) of the Clean Air Act for that 

 make and model year vehicle, and

 ``(II) in the case of a vehicle 

 having a gross vehicle weight rating of 

 more than 6,000 pounds but not more than 

 8,500 pounds, the Bin 8 Tier II emission 

 standard which is so established,

 ``(iii) which has a maximum available power of 

 at least--

 ``(I) 

 4 <<NOTE: Applicability.>> percent in 

 the case of a vehicle to which paragraph 

 (2)(A) applies,

 ``(II) 10 percent in the case of a 

 vehicle which has a gross vehicle weight 

 rating of more than 8,500 pounds and not 

 more than 14,000 pounds, and

 ``(III) 15 percent in the case of a 

 vehicle in excess of 14,000 pounds,

 ``(iv) <<NOTE: Applicability.>> which, in the 

 case of a vehicle to which paragraph (2)(B) 

 applies, has an internal combustion or heat engine 

 which has received a certificate of conformity 

 under the Clean Air Act as meeting the emission 

 standards set in the regulations prescribed by the 

 Administrator of the Environmental Protection 

 Agency for 2004 through 2007 model year diesel 

 heavy duty engines or ottocycle heavy duty 

 engines, as applicable,

 ``(v) the original use of which commences with 

 the taxpayer,

 ``(vi) which is acquired for use or lease by 

 the taxpayer and not for resale, and

 ``(vii) which is made by a manufacturer.

 Such term shall not include any vehicle which is not a 

 passenger automobile or light truck if such vehicle has 

 a gross vehicle weight rating of less than 8,500 pounds.

 ``(B) Consumable fuel.--For purposes of subparagraph 

 (A)(i)(I), the term `consumable fuel' means any solid, 

 liquid, or gaseous matter which releases energy when 

 consumed by an auxiliary power unit.

 ``(C) Maximum <<NOTE: Applicability.>> available 

 power.--

 ``(i) Certain passenger automobiles and light 

 trucks.--In the case of a vehicle to which 

 paragraph (2)(A) applies, the term `maximum 

 available power' means the maximum power available 

 from the rechargeable energy storage system, 

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 during a standard 10 second pulse power or 

 equivalent test, divided by such maximum power and 

 the SAE net power of the heat engine.

 ``(ii) Other motor vehicles.--In the case of a 

 vehicle to which paragraph (2)(B) applies, the 

 term `maximum available power' means the maximum 

 power available from the rechargeable energy 

 storage system, during a standard 10 second pulse 

 power or equivalent test, divided by the vehicle's 

 total traction power. For purposes of the 

 preceding sentence, the term `total traction 

 power' means the sum of the peak power from the 

 rechargeable energy storage system and the heat 

 engine peak power of the vehicle, except that if 

 such storage system is the sole means by which the 

 vehicle

[[Page 119 STAT. 1045]]

 can be driven, the total traction power is the 

 peak power of such storage system.

 ``(e) New Qualified Alternative Fuel Motor Vehicle Credit.--

 ``(1) Allowance of credit.--Except as provided in paragraph 

 (5), the new qualified alternative fuel motor vehicle credit 

 determined under this subsection is an amount equal to the 

 applicable percentage of the incremental cost of any new 

 qualified alternative fuel motor vehicle placed in service by 

 the taxpayer during the taxable year.

 ``(2) Applicable percentage.--For purposes of paragraph (1), 

 the applicable percentage with respect to any new qualified 

 alternative fuel motor vehicle is--

 ``(A) 50 percent, plus

 ``(B) 30 percent, if such vehicle--

 ``(i) has received a certificate of conformity 

 under the Clean Air Act and meets or exceeds the 

 most stringent standard available for 

 certification under the Clean Air Act for that 

 make and model year vehicle (other than a zero 

 emission standard), or

 ``(ii) has received an order certifying the 

 vehicle as meeting the same requirements as 

 vehicles which may be sold or leased in California 

 and meets or exceeds the most stringent standard 

 available for certification under the State laws 

 of California (enacted in accordance with a waiver 

 granted under section 209(b) of the Clean Air Act) 

 for that make and model year vehicle (other than a 

 zero emission standard).

 For purposes of the preceding sentence, in the case of any new 

 qualified alternative fuel motor vehicle which weighs more than 

 14,000 pounds gross vehicle weight rating, the most stringent 

 standard available shall be such standard available for 

 certification on the date of the enactment of the Energy Tax 

 Incentives Act of 2005.

 ``(3) Incremental cost.--For purposes of this subsection, 

 the incremental cost of any new qualified alternative fuel motor 

 vehicle is equal to the amount of the excess of the 

 manufacturer's suggested retail price for such vehicle over such 

 price for a gasoline or diesel fuel motor vehicle of the same 

 model, to the extent such amount does not exceed--

 ``(A) $5,000, if such vehicle has a gross vehicle 

 weight rating of not more than 8,500 pounds,

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 ``(B) $10,000, if such vehicle has a gross vehicle 

 weight rating of more than 8,500 pounds but not more 

 than 14,000 pounds,

 ``(C) $25,000, if such vehicle has a gross vehicle 

 weight rating of more than 14,000 pounds but not more 

 than 26,000 pounds, and

 ``(D) $40,000, if such vehicle has a gross vehicle 

 weight rating of more than 26,000 pounds.

 ``(4) New qualified alternative fuel motor vehicle.--For 

 purposes of this subsection--

 ``(A) In general.--The term `new qualified 

 alternative fuel motor vehicle' means any motor 

 vehicle--

 ``(i) which is only capable of operating on an 

 alternative fuel,

[[Page 119 STAT. 1046]]

 ``(ii) the original use of which commences 

 with the taxpayer,

 ``(iii) which is acquired by the taxpayer for 

 use or lease, but not for resale, and

 ``(iv) which is made by a manufacturer.

 ``(B) Alternative fuel.--The term `alternative fuel' 

 means compressed natural gas, liquefied natural gas, 

 liquefied petroleum gas, hydrogen, and any liquid at 

 least 85 percent of the volume of which consists of 

 methanol.

 ``(5) Credit for mixed-fuel vehicles.--

 ``(A) In general.--In the case of a mixed-fuel 

 vehicle placed in service by the taxpayer during the 

 taxable year, the credit determined under this 

 subsection is an amount equal to--

 ``(i) in the case of a 75/25 mixed-fuel 

 vehicle, 70 percent of the credit which would have 

 been allowed under this subsection if such vehicle 

 was a qualified alternative fuel motor vehicle, 

 and

 ``(ii) in the case of a 90/10 mixed-fuel 

 vehicle, 90 percent of the credit which would have 

 been allowed under this subsection if such vehicle 

 was a qualified alternative fuel motor vehicle.

 ``(B) Mixed-fuel vehicle.--For purposes of this 

 subsection, the term `mixed-fuel vehicle' means any 

 motor vehicle described in subparagraph (C) or (D) of 

 paragraph (3), which--

 ``(i) is certified by the manufacturer as 

 being able to perform efficiently in normal 

 operation on a combination of an alternative fuel 

 and a petroleum-based fuel,

 ``(ii) either--

 ``(I) has received a certificate of 

 conformity under the Clean Air Act, or

 ``(II) has received an order 

 certifying the vehicle as meeting the 

 same requirements as vehicles which may 

 be sold or leased in California and 

 meets or exceeds the low emission 

 vehicle standard under section 88.105-94 

 of title 40, Code of Federal 

 Regulations, for that make and model 

 year vehicle,

 ``(iii) the original use of which commences 

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 with the taxpayer,

 ``(iv) which is acquired by the taxpayer for 

 use or lease, but not for resale, and

 ``(v) which is made by a manufacturer.

 ``(C) 75/25 mixed-fuel vehicle.--For purposes of 

 this subsection, the term `75/25 mixed-fuel vehicle' 

 means a mixed-fuel vehicle which operates using at least 

 75 percent alternative fuel and not more than 25 percent 

 petroleum-based fuel.

 ``(D) 90/10 mixed-fuel vehicle.--For purposes of 

 this subsection, the term `90/10 mixed-fuel vehicle' 

 means a mixed-fuel vehicle which operates using at least 

 90 percent alternative fuel and not more than 10 percent 

 petroleum-based fuel.

[[Page 119 STAT. 1047]]

 ``(f) Limitation on Number of New Qualified Hybrid and Advanced 

Lean-Burn Technology Vehicles Eligible for Credit.--

 ``(1) In general.--In the case of a qualified vehicle sold 

 during the phaseout period, only the applicable percentage of 

 the credit otherwise allowable under subsection (c) or (d) shall 

 be allowed.

 ``(2) Phaseout period.--For purposes of this subsection, the 

 phaseout period is the period beginning with the second calendar 

 quarter following the calendar quarter which includes the first 

 date on which the number of qualified vehicles manufactured by 

 the manufacturer of the vehicle referred to in paragraph (1) 

 sold for use in the United States after December 31, 2005, is at 

 least 60,000.

 ``(3) Applicable percentage.--For purposes of paragraph (1), 

 the applicable percentage is--

 ``(A) 50 percent for the first 2 calendar quarters 

 of the phaseout period,

 ``(B) 25 percent for the 3d and 4th calendar 

 quarters of the phaseout period, and

 ``(C) 0 percent for each calendar quarter 

 thereafter.

 ``(4) Controlled groups.--

 ``(A) In general.--For purposes of this subsection, 

 all persons treated as a single employer under 

 subsection (a) or (b) of section 52 or subsection (m) or 

 (o) of section 414 shall be treated as a single 

 manufacturer.

 ``(B) Inclusion of <<NOTE: Applicability.>> foreign 

 corporations.--For purposes of subparagraph (A), in 

 applying subsections (a) and (b) of section 52 to this 

 section, section 1563 shall be applied without regard to 

 subsection (b)(2)(C) thereof.

 ``(5) Qualified vehicle.--For purposes of this subsection, 

 the term `qualified vehicle' means any new qualified hybrid 

 motor vehicle (described in subsection (d)(2)(A)) and any new 

 advanced lean burn technology motor vehicle.

 ``(g) Application With Other Credits.--

 ``(1) Business credit treated as part of general business 

 credit.--So much of the credit which would be allowed under 

 subsection (a) for any taxable year (determined without regard 

 to this subsection) that is attributable to property of a 

 character subject to an allowance for depreciation shall be 

 treated as a credit listed in section 38(b) for such taxable 

 year (and not allowed under subsection (a)).

 ``(2) Personal credit.--The credit allowed under subsection 

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 (a) (after the application of paragraph (1)) for any taxable 

 year shall not exceed the excess (if any) of--

 ``(A) the regular tax reduced by the sum of the 

 credits allowable under subpart A and sections 27 and 

 30, over

 ``(B) the tentative minimum tax for the taxable 

 year.

 ``(h) Other Definitions and Special Rules.--For purposes of this 

section--

 ``(1) Motor vehicle.--The term `motor vehicle' has the 

 meaning given such term by section 30(c)(2).

 ``(2) City fuel economy.--The city fuel economy with respect 

 to any vehicle shall be measured in a manner which is 

 substantially similar to the manner city fuel economy is 

 measured in accordance with procedures under part 600 of

[[Page 119 STAT. 1048]]

 subchapter Q of chapter I of title 40, Code of Federal 

 Regulations, as in effect on the date of the enactment of this 

 section.

 ``(3) Other terms.--The terms `automobile', `passenger 

 automobile', `medium duty passenger vehicle', `light truck', and 

 `manufacturer' have the meanings given such terms in regulations 

 prescribed by the Administrator of the Environmental Protection 

 Agency for purposes of the administration of title II of the 

 Clean Air Act (42 U.S.C. 7521 et seq.).

 ``(4) Reduction in basis.--For purposes of this subtitle, 

 the basis of any property for which a credit is allowable under 

 subsection (a) shall be reduced by the amount of such credit so 

 allowed (determined without regard to subsection (g)).

 ``(5) No double benefit.--The amount of any deduction or 

 other credit allowable under this chapter--

 ``(A) for any incremental cost taken into account in 

 computing the amount of the credit determined under 

 subsection (e) shall be reduced by the amount of such 

 credit attributable to such cost, and

 ``(B) with respect to a vehicle described under 

 subsection (b) or (c), shall be reduced by the amount of 

 credit allowed under subsection (a) for such vehicle for 

 the taxable year.

 ``(6) Property used by tax-exempt entity.--In the case of a 

 vehicle whose use is described in paragraph (3) or (4) of 

 section 50(b) and which is not subject to a lease, the person 

 who sold such vehicle to the person or entity using such vehicle 

 shall be treated as the taxpayer that placed such vehicle in 

 service, but only if such person clearly discloses to such 

 person or entity in a document the amount of any credit 

 allowable under subsection (a) with respect to such vehicle 

 (determined without regard to subsection (g)).

 ``(7) Property used outside united states, etc., not 

 qualified.--No credit shall be allowable under subsection (a) 

 with respect to any property referred to in section 50(b)(1) or 

 with respect to the portion of the cost of any property taken 

 into account under section 179.

 ``(8) Recapture.--The <<NOTE: Regulations.>> Secretary 

 shall, by regulations, provide for recapturing the benefit of 

 any credit allowable under subsection (a) with respect to any 

 property which ceases to be property eligible for such credit 

 (including recapture in the case of a lease period of less than 

 the economic life of a vehicle).

 ``(9) Election to not take credit.--No credit shall be 

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 allowed under subsection (a) for any vehicle if the taxpayer 

 elects to not have this section apply to such vehicle.

 ``(10) Interaction with air quality and motor vehicle safety 

 standards.--Unless otherwise provided in this section, a motor 

 vehicle shall not be considered eligible for a credit under this 

 section unless such vehicle is in compliance with--

 ``(A) the applicable provisions of the Clean Air Act 

 for the applicable make and model year of the vehicle 

 (or applicable air quality provisions of State law in 

 the case of a State which has adopted such provision 

 under a waiver under section 209(b) of the Clean Air 

 Act), and

 ``(B) the motor vehicle safety provisions of 

 sections 30101 through 30169 of title 49, United States 

 Code.

 ``(i) Regulations.--

[[Page 119 STAT. 1049]]

 ``(1) In general.--Except as provided in paragraph (2), the 

 Secretary shall promulgate such regulations as necessary to 

 carry out the provisions of this section.

 ``(2) Coordination in prescription of certain regulations.--

 The Secretary of the Treasury, in coordination with the 

 Secretary of Transportation and the Administrator of the 

 Environmental Protection Agency, shall prescribe such 

 regulations as necessary to determine whether a motor vehicle 

 meets the requirements to be eligible for a credit under this 

 section.

 ``(j) Termination.--This section shall not apply to any property 

purchased after--

 ``(1) in the case of a new qualified fuel cell motor vehicle 

 (as described in subsection (b)), December 31, 2014,

 ``(2) in the case of a new advanced lean burn technology 

 motor vehicle (as described in subsection (c)) or a new 

 qualified hybrid motor vehicle (as described in subsection 

 (d)(2)(A)), December 31, 2010,

 ``(3) in the case of a new qualified hybrid motor vehicle 

 (as described in subsection (d)(2)(B)), December 31, 2009, and

 ``(4) in the case of a new qualified alternative fuel 

 vehicle (as described in subsection (e)), December 31, 2010.''.

 (b) Conforming Amendments.--

 (1) Section 38(b), as amended by this Act, is amended by 

 striking ``plus'' at the end of paragraph (23), by striking the 

 period at the end of paragraph (24) and inserting ``, and'', and 

 by adding at the end the following new paragraph:

 ``(25) the portion of the alternative motor vehicle credit 

 to which section 30B(g)(1) applies.''.

 (2) Section 1016(a), as amended by this Act, is amended by 

 striking ``and'' at the end of paragraph (34), by striking the 

 period at the end of paragraph (35) and inserting ``, and'', and 

 by adding at the end the following new paragraph:

 ``(36) to the extent provided in section 30B(h)(4).''.

 (3) Section 55(c)(2), as amended by this Act, is amended by 

 inserting ``30B(g)(2),'' after ``30(b)(2),''.

 (4) Section 6501(m) is amended by inserting ``30B(h)(9),'' 

 after ``30(d)(4),''.

 (5) The table of sections for subpart B of part IV of 

 subchapter A of chapter 1 is amended by inserting after the item 

 relating to section 30A the following new item:

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``Sec. 30B. Alternative motor vehicle credit.''.

 (c) Effective Date.--The <<NOTE: 26 USC 30B note.>> amendments made 

by this section shall apply to property placed in service after December 

31, 2005, in taxable years ending after such date.

SEC. 1342. CREDIT FOR INSTALLATION OF ALTERNATIVE FUELING STATIONS.

 (a) In General.--Subpart B of part IV of subchapter A of chapter 1 

(relating to other credits), as amended by this Act, is amended by 

adding at the end the following new section:

``SEC. 30C. ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY CREDIT.

 ``(a) Credit Allowed.--There shall be allowed as a credit against 

the tax imposed by this chapter for the taxable year an amount equal to 

30 percent of the cost of any qualified alternative

[[Page 119 STAT. 1050]]

fuel vehicle refueling property placed in service by the taxpayer during 

the taxable year.

 ``(b) Limitation.--The credit allowed under subsection (a) with 

respect to any alternative fuel vehicle refueling property shall not 

exceed--

 ``(1) $30,000 in the case of a property of a character 

 subject to an allowance for depreciation, and

 ``(2) $1,000 in any other case.

 ``(c) Qualified Alternative Fuel Vehicle Refueling Property.--

 ``(1) In general.--Except as provided in paragraph (2), the 

 term `qualified alternative fuel vehicle refueling property' has 

 the meaning given to such term by section 179A(d), but only with 

 respect to any fuel--

 ``(A) at least 85 percent of the volume of which 

 consists of one or more of the following: ethanol, 

 natural gas, compressed natural gas, liquefied natural 

 gas, liquefied petroleum gas, or hydrogen, or

 ``(B) any mixture of biodiesel (as defined in 

 section 40A(d)(1)) and diesel fuel (as defined in 

 section 4083(a)(3)), determined without regard to any 

 use of kerosene and containing at least 20 percent 

 biodiesel.

 ``(2) Residential property.--In the case of any property 

 installed on property which is used as the principal residence 

 (within the meaning of section 121) of the taxpayer, paragraph 

 (1) of section 179A(d) shall not apply.

 ``(d) Application With Other Credits.--

 ``(1) Business credit treated as part of general business 

 credit.--So much of the credit which would be allowed under 

 subsection (a) for any taxable year (determined without regard 

 to this subsection) that is attributable to property of a 

 character subject to an allowance for depreciation shall be 

 treated as a credit listed in section 38(b) for such taxable 

 year (and not allowed under subsection (a)).

 ``(2) Personal credit.--The credit allowed under subsection 

 (a) (after the application of paragraph (1)) for any taxable 

 year shall not exceed the excess (if any) of--

 ``(A) the regular tax reduced by the sum of the 

 credits allowable under subpart A and sections 27, 30, 

 and 30B, over

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 ``(B) the tentative minimum tax for the taxable 

 year.

 ``(e) Special Rules.--For purposes of this section--

 ``(1) Basis reduction.--The basis of any property shall be 

 reduced by the portion of the cost of such property taken into 

 account under subsection (a).

 ``(2) Property used by tax-exempt entity.--In the case of 

 any qualified alternative fuel vehicle refueling property the 

 use of which is described in paragraph (3) or (4) of section 

 50(b) and which is not subject to a lease, the person who sold 

 such property to the person or entity using such property shall 

 be treated as the taxpayer that placed such property in service, 

 but only if such person clearly discloses to such person or 

 entity in a document the amount of any credit allowable under 

 subsection (a) with respect to such property (determined without 

 regard to subsection (d)).

 ``(3) Property used outside united states not qualified.--No 

 credit shall be allowable under subsection (a) with

[[Page 119 STAT. 1051]]

 respect to any property referred to in section 50(b)(1) or with 

 respect to the portion of the cost of any property taken into 

 account under section 179.

 ``(4) Election not to take credit.--No credit shall be 

 allowed under subsection (a) for any property if the taxpayer 

 elects not to have this section apply to such property.

 ``(5) Recapture rules.--

 Rules <<NOTE: Applicability.>> similar to the rules of section 

 179A(e)(4) shall apply.

 ``(f) Regulations.--The Secretary shall prescribe such regulations 

as necessary to carry out the provisions of this section.

 ``(g) Termination.--This section shall not apply to any property 

placed in service--

 ``(1) in the case of property relating to hydrogen, after 

 December 31, 2014, and

 ``(2) in the case of any other property, after December 31, 

 2009.''.

 (b) Conforming Amendments.--

 (1) Section 38(b), as amended by this Act, is amended by 

 striking ``plus'' at the end of paragraph (24), by striking the 

 period at the end of paragraph (25) and inserting ``, and'', and 

 by adding at the end the following new paragraph:

 ``(26) the portion of the alternative fuel vehicle refueling 

 property credit to which section 30C(d)(1) applies.''.

 (2) Section 1016(a), as amended by this Act, is amended by 

 striking ``and'' at the end of paragraph (35), by striking the 

 period at the end of paragraph (36) and inserting ``, and'', and 

 by adding at the end the following new paragraph:

 ``(37) to the extent provided in section 30C(f).''.

 (3) Section 55(c)(2), as amended by this Act, is amended by 

 inserting ``30C(d)(2),'' after ``30B(g)(2),''.

 (4) Section 6501(m) is amended by inserting ``30C(e)(5),'' 

 after ``30B(h)(9),''.

 (5) The table of sections for subpart B of part IV of 

 subchapter A of chapter 1, as amended by this Act, is amended by 

 inserting after the item relating to section 30B the following 

 new item:

``Sec. 30C. Clean-fuel vehicle refueling property credit.''.

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 (c) Effective Date.--The <<NOTE: 26 USC 30C note.>> amendments made 

by this section shall apply to property placed in service after December 

31, 2005, in taxable years ending after such date.

SEC. 1343. REDUCED MOTOR FUEL EXCISE TAX ON CERTAIN MIXTURES OF DIESEL 

 FUEL.

 (a) In General.--Paragraph (2) of section 4081(a) is amended by 

adding at the end the following:

 ``(D) Diesel-water fuel emulsion.--

 In <<NOTE: Applicability.>> the case of diesel-water 

 fuel emulsion at least 14 percent of which is water and 

 with respect to which the emulsion additive is 

 registered by a United States manufacturer with the 

 Environmental Protection Agency pursuant to section 211 

 of the Clean Air Act (as in effect on March 31, 2003), 

 subparagraph (A)(iii) shall be applied by substituting 

 `19.7 cents' for `24.3 cents'. The preceding sentence 

 shall not apply to the removal, sale, or use of diesel-

 water fuel emulsion unless the person so removing, 

 selling, or using such fuel is registered under section 

 4101.''.

 (b) Special Rules for Diesel-Water Fuel Emulsions.--

[[Page 119 STAT. 1052]]

 (1) Refunds for tax-paid purchases.--Section <<NOTE: 26 USC 

 6427.>> 6427 is amended by redesignating subsections (m) through 

 (p) as subsections (n) through (q), respectively, and by 

 inserting after subsection (l) the following new subsection:

 ``(m) Diesel Fuel Used to Produce Emulsion.--

 ``(1) In general.--Except as provided in subsection (k), if 

 any diesel fuel on which tax was imposed by section 4081 at the 

 regular tax rate is used by any person in producing an emulsion 

 described in section 4081(a)(2)(D) which is sold or used in such 

 person's trade or business, the Secretary shall pay (without 

 interest) to such person an amount equal to the excess of the 

 regular tax rate over the incentive tax rate with respect to 

 such fuel.

 ``(2) Definitions.--For purposes of paragraph (1)--

 ``(A) Regular tax rate.--The term `regular tax rate' 

 means the aggregate rate of tax imposed by section 4081 

 determined without regard to section 4081(a)(2)(D).

 ``(B) Incentive tax rate.--The term `incentive tax 

 rate' means the aggregate rate of tax imposed by section 

 4081 determined with regard to section 4081(a)(2)(D).''.

 (2) Later separation of fuel.--Section 4081 (relating to 

 imposition of tax) is amended by inserting after subsection (b) 

 the following new subsection:

 ``(c) Later Separation of Fuel From Diesel-Water Fuel Emulsion.--If 

any person separates the taxable fuel from a diesel-water fuel emulsion 

on which tax was imposed under subsection (a) at a rate determined under 

subsection (a)(2)(D) (or with respect to which a credit or payment was 

allowed or made by reason of section 6427), such person shall be treated 

as the refiner of such taxable fuel. The amount of tax imposed on any 

removal of such fuel by such person shall be reduced by the amount of 

tax imposed (and not credited or refunded) on any prior removal or entry 

of such fuel.''.

 (3) Credit claims.--Paragraphs (1) and (2) of section 

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 6427(i) are both amended by inserting ``(m),'' after ``(l),''.

 (c) Effective Date.--The <<NOTE: 26 USC 4081 note.>> amendments made 

by this section shall take effect on January 1, 2006.

SEC. 1344. EXTENSION OF EXCISE TAX PROVISIONS AND INCOME TAX CREDIT FOR 

 BIODIESEL.

 (a) In General.--Sections 40A(e), 6426(c)(6), and 6427(e)(4)(B) are 

each amended by striking ``2006'' and inserting ``2008''.

 (b) Effective Date.--The <<NOTE: 26 USC 40A note.>> amendments made 

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

Act.

SEC. 1345. SMALL AGRI-BIODIESEL PRODUCER CREDIT.

 (a) In General.--Subsection (a) of section 40A (relating to 

biodiesel used as a fuel) is amended to read as follows:

 ``(a) General Rule.--For purposes of section 38, the biodiesel fuels 

credit determined under this section for the taxable year is an amount 

equal to the sum of--

 ``(1) the biodiesel mixture credit, plus

 ``(2) the biodiesel credit, plus

 ``(3) in the case of an eligible small agri-biodiesel 

 producer, the small agri-biodiesel producer credit.''.

 (b) Small Agri-Biodiesel Producer Credit Defined.--Section 40A(b) 

(relating to definition of biodiesel mixture credit and

[[Page 119 STAT. 1053]]

biodiesel credit) is amended by adding at the end the following new 

paragraph:

 ``(5) Small agri-biodiesel producer credit.--

 ``(A) In general.--The small agri-biodiesel producer 

 credit of any eligible small agri-biodiesel producer for 

 any taxable year is 10 cents for each gallon of 

 qualified agri-biodiesel production of such producer.

 ``(B) Qualified agri-biodiesel production.--For 

 purposes of this paragraph, the term `qualified agri-

 biodiesel production' means any agri-biodiesel 

 (determined without regard to the last sentence of 

 subsection (d)(2)) which is produced by an eligible 

 small agri-biodiesel producer, and which during the 

 taxable year--

 ``(i) is sold by such producer to another 

 person--

 ``(I) for use by such other person 

 in the production of a qualified 

 biodiesel mixture in such other person's 

 trade or business (other than casual 

 off-farm production),

 ``(II) for use by such other person 

 as a fuel in a trade or business, or

 ``(III) who sells such agri-

 biodiesel at retail to another person 

 and places such agri-biodiesel in the 

 fuel tank of such other person, or

 ``(ii) is used or sold by such producer for 

 any purpose described in clause (i).

 ``(C) Limitation.--The qualified agri-biodiesel 

 production of any producer for any taxable year shall 

 not exceed 15,000,000 gallons.''.

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 (c) Definitions and Special Rules.--Section 40A is amended by 

redesignating subsection (e) as subsection (f) and by inserting after 

subsection (d) the following new subsection:

 ``(e) Definitions and Special Rules for Small Agri-Biodiesel 

Producer Credit.--For purposes of this section--

 ``(1) Eligible small agri-biodiesel producer.--The term 

 `eligible small agri-biodiesel producer' means a person who, at 

 all times during the taxable year, has a productive capacity for 

 agri-biodiesel not in excess of 60,000,000 gallons.

 ``(2) Aggregation rule.--For purposes of the 15,000,000 

 gallon limitation under subsection (b)(5)(C) and the 60,000,000 

 gallon limitation under paragraph (1), all members of the same 

 controlled group of corporations (within the meaning of section 

 267(f)) and all persons under common control (within the meaning 

 of section 52(b) but determined by treating an interest of more 

 than 50 percent as a controlling interest) shall be treated as 1 

 person.

 ``(3) Partnership, s <<NOTE: Applicability.>> corporation, 

 and other pass-thru entities.--In the case of a partnership, 

 trust, S corporation, or other pass-thru entity, the limitations 

 contained in subsection (b)(5)(C) and paragraph (1) shall be 

 applied at the entity level and at the partner or similar level.

 ``(4) Allocation.--For purposes of this subsection, in the 

 case of a facility in which more than 1 person has an interest, 

 productive capacity shall be allocated among such persons in 

 such manner as the Secretary may prescribe.

 ``(5) Regulations.--The Secretary may prescribe such 

 regulations as may be necessary--

[[Page 119 STAT. 1054]]

 ``(A) to prevent the credit provided for in 

 subsection (a)(3) from directly or indirectly benefiting 

 any person with a direct or indirect productive capacity 

 of more than 60,000,000 gallons of agri-biodiesel during 

 the taxable year, or

 ``(B) to prevent any person from directly or 

 indirectly benefiting with respect to more than 

 15,000,000 gallons during the taxable year.

 ``(6) Allocation of small agri-biodiesel credit to patrons 

 of cooperative.--

 ``(A) Election to allocate.--

 ``(i) In general.--In the case of a 

 cooperative organization described in section 

 1381(a), any portion of the credit determined 

 under subsection (a)(3) for the taxable year may, 

 at the election of the organization, be 

 apportioned pro rata among patrons of the 

 organization on the basis of the quantity or value 

 of business done with or for such patrons for the 

 taxable year.

 ``(ii) Form and effect of election.--An 

 election under clause (i) for any taxable year 

 shall be made on a timely filed return for such 

 year. Such election, once made, shall be 

 irrevocable for such taxable year. Such election 

 shall not take effect unless the organization 

 designates the apportionment as such in a written 

 notice mailed to its patrons during the payment 

 period described in section 1382(d).

 ``(B) Treatment of organizations and patrons.--

 ``(i) Organizations.--The amount of the credit 

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 not apportioned to patrons pursuant to 

 subparagraph (A) shall be included in the amount 

 determined under subsection (a)(3) for the taxable 

 year of the organization.

 ``(ii) Patrons.--The amount of the credit 

 apportioned to patrons pursuant to subparagraph 

 (A) shall be included in the amount determined 

 under such subsection for the first taxable year 

 of each patron ending on or after the last day of 

 the payment period (as defined in section 1382(d)) 

 for the taxable year of the organization or, if 

 earlier, for the taxable year of each patron 

 ending on or after the date on which the patron 

 receives notice from the cooperative of the 

 apportionment.

 ``(iii) Special rules for decrease in credits 

 for taxable year.--If the amount of the credit of 

 the organization determined under such subsection 

 for a taxable year is less than the amount of such 

 credit shown on the return of the organization for 

 such year, an amount equal to the excess of--

 ``(I) such reduction, over

 ``(II) the amount not apportioned to 

 such patrons under subparagraph (A) for 

 the taxable year, shall be treated as an 

 increase in tax imposed by this chapter 

 on the organization. Such increase shall 

 not be treated as tax imposed by this 

 chapter for purposes of determining the 

 amount of any

[[Page 119 STAT. 1055]]

 credit under this chapter or for 

 purposes of section 55.''.

 (d) Conforming Amendments.--

 (1) Paragraph (4) of section 40A(b) is amended by striking 

 ``this section'' and inserting ``paragraph (1) or (2) of 

 subsection (a)''.

 (2) The heading of subsection (b) of section 40A is amended 

 by striking ``and Biodiesel Credit'' and inserting ``, Biodiesel 

 Credit, and Small Agri-biodiesel Producer Credit''.

 (3) Paragraph (3) of section 40A(d) is amended by 

 redesignating subparagraph (C) as subparagraph (D) and by 

 inserting after subparagraph (B) the following new subparagraph:

 ``(C) Producer credit.--If--

 ``(i) any credit was determined under 

 subsection (a)(3), and

 ``(ii) any person does not use such fuel for a 

 purpose described in subsection (b)(5)(B), then 

 there is hereby imposed on such person a tax equal 

 to 10 cents a gallon for each gallon of such agri-

 biodiesel.''.

 (e) Effective Date.--The <<NOTE: 26 USC 40A note.>> amendments made 

by this section shall apply to taxable years ending after the date of 

the enactment of this Act.

SEC. 1346. RENEWABLE DIESEL.

 (a) In General.--Section 40A (relating to biodiesel used as fuel), 

as amended by this Act, is amended by redesignating subsection (f) as 

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subsection (g) and by inserting after subsection (e) the following new 

subsection:

 ``(f) Renewable Diesel.--For purposes of this title--

 ``(1) Treatment in the same manner as biodiesel.--Except as 

 provided in paragraph (2), renewable diesel shall be treated in 

 the same manner as biodiesel.

 ``(2) Exceptions.--

 ``(A) Rate of <<NOTE: Applicability.>> credit.--

 Subsections (b)(1)(A) and (b)(2)(A) shall be applied 

 with respect to renewable diesel by substituting `$1.00' 

 for `50 cents'.

 ``(B) Nonapplication of certain credits.--

 Subsections (b)(3) and (b)(5) shall not apply with 

 respect to renewable diesel.

 ``(3) Renewable diesel defined.--The term `renewable diesel' 

 means diesel fuel derived from biomass (as defined in section 

 45K(c)(3)) using a thermal depolymerization process which 

 meets--

 ``(A) the registration requirements for fuels and 

 fuel additives established by the Environmental 

 Protection Agency under section 211 of the Clean Air Act 

 (42 U.S.C. 7545), and

 ``(B) the requirements of the American Society of 

 Testing and Materials D975 or D396.''.

 (b) Clerical Amendments.--

 (1) The heading for section 40A is amended by inserting 

 ``and renewable diesel'' after ``biodiesel''.

 (2) The item in the table of contents for subpart D of part 

 IV of subchapter A of chapter 1 relating to section 40A is 

 amended to read as follows:

``Sec. 40A. Biodiesel and renewable diesel used as fuel.''.

[[Page 119 STAT. 1056]]

 (c) Effective Date.--The <<NOTE: 26 USC 40A note.>> amendment made 

by subsection (a) shall apply with respect to fuel sold or used after 

December 31, 2005.

SEC. 1347. MODIFICATION OF SMALL ETHANOL PRODUCER CREDIT.

 (a) Definition of Small Ethanol Producer.--Section 40(g) (relating 

to definitions and special rules for eligible small ethanol producer 

credit) is amended by striking ``30,000,000'' each place it appears and 

inserting ``60,000,000''.

 (b) Written Notice of Election to Allocate Credit to Patrons.--

Section 40(g)(6)(A)(ii) (relating to form and effect of election) is 

amended by adding at the end the following new sentence: ``Such election 

shall not take effect unless the organization designates the 

apportionment as such in a written notice mailed to its patrons during 

the payment period described in section 1382(d).''.

 (c) Effective Date.--The <<NOTE: 26 USC 40 note.>> amendments made 

by this section shall apply to taxable years ending after the date of 

the enactment of this Act.

SEC. 1348. SUNSET OF DEDUCTION FOR CLEAN-FUEL VEHICLES AND CERTAIN 

 REFUELING PROPERTY.

 Subsection (f) of section 179A (relating to termination) is amended 

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by striking ``December 31, 2006'' and inserting ``December 31, 2005''.

 Subtitle E--Additional Energy Tax Incentives

SEC. 1351. EXPANSION OF RESEARCH CREDIT.

 (a) Credit for Expenses Attributable to Certain Collaborative Energy 

Research Consortia.--

 (1) In general.--Section 41(a) (relating to credit for 

 increasing research activities) is amended by striking ``and'' 

 at the end of paragraph (1), by striking the period at the end 

 of paragraph (2) and inserting ``, and'', and by adding at the 

 end the following new paragraph:

 ``(3) 20 percent of the amounts paid or incurred by the 

 taxpayer in carrying on any trade or business of the taxpayer 

 during the taxable year (including as contributions) to an 

 energy research consortium.''.

 (2) Energy research consortium defined.--Section 41(f) 

 (relating to special rules) is amended by adding at the end the 

 following new paragraph:

 ``(6) Energy research consortium.--

 ``(A) In general.--The term `energy research 

 consortium' means any organization--

 ``(i) which is--

 ``(I) described in section 501(c)(3) 

 and is exempt from tax under section 

 501(a) and is organized and operated 

 primarily to conduct energy research, or

 ``(II) organized and operated 

 primarily to conduct energy research in 

 the public interest (within the meaning 

 of section 501(c)(3)),

 ``(ii) which is not a private foundation,

[[Page 119 STAT. 1057]]

 ``(iii) to which at least 5 unrelated persons 

 paid or incurred during the calendar year in which 

 the taxable year of the organization begins 

 amounts (including as contributions) to such 

 organization for energy research, and

 ``(iv) to which no single person paid or 

 incurred (including as contributions) during such 

 calendar year an amount equal to more than 50 

 percent of the total amounts received by such 

 organization during such calendar year for energy 

 research.

 ``(B) Treatment of persons.--All persons treated as 

 a single employer under subsection (a) or (b) of section 

 52 shall be treated as related persons for purposes of 

 subparagraph (A)(iii) and as a single person for 

 purposes of subparagraph (A)(iv).''.

 (3) Conforming amendment.--Section 41(b)(3)(C) is amended by 

 inserting ``(other than an energy research consortium)'' after 

 ``organization''.

 (b) Repeal of Limitation on Contract Research Expenses Paid to Small 

Businesses, Universities, and Federal Laboratories.--Section 41(b)(3) 

(relating to contract research expenses) is amended by adding at the end 

the following new subparagraph:

 ``(D) Amounts paid to eligible small businesses, 

 universities, and federal laboratories.--

 ``(i) In general.--In the case of amounts paid 

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 by the taxpayer to--

 ``(I) an eligible small business,

 ``(II) an institution of higher 

 education (as defined in section 

 3304(f)), or

 ``(III) 

 an <<NOTE: Applicability.>> organization 

 which is a Federal laboratory,

 for qualified research which is energy research, 

 subparagraph (A) shall be applied by substituting 

 `100 percent' for `65 percent'.

 ``(ii) Eligible small business.--For purposes 

 of this subparagraph, the term `eligible small 

 business' means a small business with respect to 

 which the taxpayer does not own (within the 

 meaning of section 318) 50 percent or more of--

 ``(I) in the case of a corporation, 

 the outstanding stock of the corporation 

 (either by vote or value), and

 ``(II) in the case of a small 

 business which is not a corporation, the 

 capital and profits interests of the 

 small business.

 ``(iii) Small business.--For purposes of this 

 subparagraph--

 ``(I) In general.--The term `small 

 business' means, with respect to any 

 calendar year, any person if the annual 

 average number of employees employed by 

 such person during either of the 2 

 preceding calendar years was 500 or 

 fewer. For purposes of the preceding 

 sentence, a preceding calendar year may 

 be taken into account only if the person 

 was in existence throughout the year.

[[Page 119 STAT. 1058]]

 ``(II) Startups, controlled groups, 

 and predecessors.--Rules similar to the 

 rules of subparagraphs (B) and (D) of 

 section 220(c)(4) shall apply for 

 purposes of this clause.

 ``(iv) Federal laboratory.--For purposes of 

 this subparagraph, the term `Federal laboratory' 

 has the meaning given such term by section 4(6) of 

 the Stevenson-Wydler Technology Innovation Act of 

 1980 (15 U.S.C. 3703(6)), as in effect on the date 

 of the enactment of the Energy Tax Incentives Act 

 of 2005.''.

 (c) Effective Date.--The amendments made by this section shall apply 

to amounts paid or incurred after the date of the enactment of this Act, 

in taxable years ending after such date.

SEC. 1352. <<NOTE: 26 USC 41 note.>> NATIONAL ACADEMY OF SCIENCES STUDY 

 AND REPORT.

 (a) Study.--Not <<NOTE: Contracts.>> later than 60 days after the 

date of the enactment of this Act, the Secretary of the Treasury shall 

enter into an agreement with the National Academy of Sciences under 

which the National Academy of Sciences shall conduct a study to define 

and evaluate the health, environmental, security, and infrastructure 

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external costs and benefits associated with the production and 

consumption of energy that are not or may not be fully incorporated into 

the market price of such energy, or into the Federal tax or fee or other 

applicable revenue measure related to such production or consumption.

 (b) Report.--Not later than 2 years after the date on which the 

agreement under subsection (a) is entered into, the National Academy of 

Sciences shall submit to Congress a report on the study conducted under 

subsection (a).

SEC. 1353. RECYCLING STUDY.

 (a) Study.--The Secretary of the Treasury, in consultation with the 

Secretary of Energy, shall conduct a study--

 (1) to determine and quantify the energy savings achieved 

 through the recycling of glass, paper, plastic, steel, aluminum, 

 and electronic devices, and

 (2) to identify tax incentives which would encourage 

 recycling of such material.

 (b) Report.--Not later than 1 year after the date of the enactment 

of this Act, the Secretary of the Treasury shall submit to Congress a 

report on the study conducted under subsection (a).

 Subtitle F--Revenue Raising Provisions

SEC. 1361. OIL SPILL LIABILITY TRUST FUND FINANCING RATE.

 Section 4611(f) (relating to application of oil spill liability 

trust fund financing rate) is amended to read as follows:

 ``(f) Application of Oil Spill Liability Trust Fund Financing 

Rate.--

 ``(1) In general.--Except <<NOTE: Effective date.>> as 

 provided in paragraphs (2) and (3), the Oil Spill Liability 

 Trust Fund financing rate under subsection (c) shall apply on 

 and after April 1, 2006, or if later, the date which is 30 days 

 after the last day of any calendar quarter for which the 

 Secretary estimates that, as of the close of that quarter, the 

 unobligated balance in the Oil Spill Liability Trust Fund is 

 less than $2,000,000,000.

[[Page 119 STAT. 1059]]

 ``(2) Fund balance.--The Oil Spill Liability Trust Fund 

 financing rate shall not apply during a calendar quarter if the 

 Secretary estimates that, as of the close of the preceding 

 calendar quarter, the unobligated balance in the Oil Spill 

 Liability Trust Fund exceeds $2,700,000,000.

 ``(3) Termination.--The Oil Spill Liability Trust Fund 

 financing rate shall not apply after December 31, 2014.''.

SEC. 1362. EXTENSION OF LEAKING UNDERGROUND STORAGE TANK TRUST FUND 

 FINANCING RATE.

 (a) In General.--Paragraph (3) of section 4081(d) (relating to 

Leaking Underground Storage Tank Trust Fund financing rate) is amended 

by striking ``2005'' and inserting ``2011''.

 (b) No Exemptions From Tax Except for Exports.--

 (1) In general.--Section 4082(a) (relating to exemptions for 

 diesel fuel and kerosene) is amended by inserting ``(other than 

 such tax at the Leaking Underground Storage Tank Trust Fund 

 financing rate imposed in all cases other than for export)'' 

 after ``section 4081''.

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 (2) Amendments relating to section 4041.--

 (A) Subsections (a)(1)(B), (a)(2)(A), and (c)(2) of 

 section 4041 are each amended by inserting ``(other than 

 such tax at the Leaking Underground Storage Tank Trust 

 Fund financing rate)'' after ``section 4081''.

 (B) Section 4041(b)(1)(A) is amended by striking 

 ``or (d)(1))''.

 (C) Section 4041(d) is amended by adding at the end 

 the following new paragraph:

 ``(5) Nonapplication of exemptions other than for exports.--

 For purposes of this section, the tax imposed under this 

 subsection shall be determined without regard to subsections 

 (f), (g) (other than with respect to any sale for export under 

 paragraph (3) thereof), (h), and (l).''.

 (3) No refund.--

 (A) In general.--Subchapter B of chapter 65 is 

 amended by adding at the end the following new section:

``SEC. 6430. TREATMENT OF TAX IMPOSED AT LEAKING UNDERGROUND STORAGE 

 TANK TRUST FUND FINANCING RATE.

 ``No refunds, credits, or payments shall be made under this 

subchapter for any tax imposed at the Leaking Underground Storage Tank 

Trust Fund financing rate, except in the case of fuels destined for 

export.''.

 (B) Clerical amendment.--The table of sections for 

 subchapter B of chapter 65 is amended by adding at the 

 end the following new item:

``Sec. 6430. Treatment of tax imposed at Leaking Underground Storage 

 Tank Trust Fund financing rate.''.

 (c) Certain Refunds and Credits Not Charged to LUST Trust Fund.--

Subsection (c) of section 9508 (relating to Leaking Underground Storage 

Tank Trust Fund) is amended to read as follows:

 ``(c) Expenditures.--Amounts in the Leaking Underground Storage Tank 

Trust Fund shall be available, as provided in appropriation Acts, only 

for purposes of making expenditures to carry out section 9003(h) of the 

Solid Waste Disposal Act as in effect

[[Page 119 STAT. 1060]]

on the date of the enactment of the Superfund Amendments and 

Reauthorization Act of 1986.''.

 (d) Effective <<NOTE: 26 USC 4041 note.>> Dates.--

 (1) In general.--Except as provided in paragraph (2), the 

 amendments made by this section shall take effect on October 1, 

 2005.

 (2) No exemption.--The amendments made by subsection (b) 

 shall apply to fuel entered, removed, or sold after September 

 30, 2005.

SEC. 1363. MODIFICATION OF RECAPTURE RULES FOR AMORTIZABLE SECTION 197 

 INTANGIBLES.

 (a) In General.--Subsection (b) of section 1245 (relating to gain 

from dispositions of certain depreciable property) is amended by adding 

at the end the following new paragraph:

 ``(9) Disposition of amortizable section 197 intangibles.--

 ``(A) In general.--If a taxpayer disposes of more 

 than 1 amortizable section 197 intangible (as defined in 

 section 197(c)) in a transaction or a series of related 

 transactions, all such amortizable 197 intangibles shall 

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 be treated as 1 section 1245 property for purposes of 

 this section.

 ``(B) Exception.--Subparagraph (A) shall not apply 

 to any amortizable section 197 intangible (as so 

 defined) with respect to which the adjusted basis 

 exceeds the fair market value.''.

 (b) Effective Date.--The <<NOTE: 26 USC 1245 note.>> amendment made 

by this section shall apply to dispositions of property after the date 

of the enactment of this Act.

SEC. 1364. CLARIFICATION OF TIRE EXCISE TAX.

 (a) In General.--Section 4072(e) (defining super single tire) is 

amended by adding at the end the following: ``Such term shall not 

include any tire designed for steering.''

 (b) Effective Date.--The <<NOTE: 26 USC 4072 note.>> amendment made 

by this section shall take effect as if included in section 869 of the 

American Jobs Creation Act of 2004.

 (c) Study.--

 (1) In general.--With <<NOTE: Effective date.>> respect to 

 the 1-year period beginning on January 1, 2006, the Secretary of 

 the Treasury shall conduct a study to determine--

 (A) the amount of tax collected during such period 

 under section 4071 of the Internal Revenue Code of 1986 

 with respect to each class of tire, and

 (B) the number of tires in each such class on which 

 tax is imposed under such section during such period.

 (2) Report.--Not later than July 1, 2007, the Secretary of 

 the Treasury shall submit to Congress a report on the study 

 conducted under paragraph (1).

[[Page 119 STAT. 1061]]

 TITLE XIV--MISCELLANEOUS

 Subtitle A--In General

SEC. 1401. SENSE OF CONGRESS ON RISK ASSESSMENTS.

 Subtitle B of title XXX of the Energy Policy Act of 1992 is amended 

by adding at the end the following new section:

``SEC. 3022. <<NOTE: 42 USC 13557.>> SENSE OF CONGRESS ON RISK 

 ASSESSMENTS.

 ``It is the sense of Congress that Federal agencies conducting 

assessments of risks to human health and the environment from energy 

technology, production, transport, transmission, distribution, storage, 

use, or conservation activities shall use sound and objective scientific 

practices in assessing such risks, shall consider the best available 

science (including peer reviewed studies), and shall include a 

description of the weight of the scientific evidence concerning such 

risks.''.

SEC. 1402. <<NOTE: 42 USC 16491.>> ENERGY PRODUCTION INCENTIVES.

 (a) In General.--A State may provide to any entity--

 (1) a credit against any tax or fee owed to the State under 

 a State law, or

 (2) any other tax incentive,

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determined by the State to be appropriate, in the amount calculated 

under and in accordance with a formula determined by the State, for 

production described in subsection (b) in the State by the entity that 

receives such credit or such incentive.

 (b) Eligible Entities.--Subsection 

(a) <<NOTE: Applicability.>> shall apply with respect to the production 

in the State of electricity from coal mined in the State and used in a 

facility, if such production meets all applicable Federal and State laws 

and if such facility uses scrubbers or other forms of clean coal 

technology.

 (c) Effect on Interstate Commerce.--Any action taken by a State in 

accordance with this section with respect to a tax or fee payable, or 

incentive applicable, for any period beginning after the date of the 

enactment of this Act shall--

 (1) be considered to be a reasonable regulation of commerce; 

 and

 (2) not be considered to impose an undue burden on 

 interstate commerce or to otherwise impair, restrain, or 

 discriminate, against interstate commerce.

SEC. 1403. <<NOTE: 42 USC 16492.>> REGULATION OF CERTAIN OIL USED IN 

 TRANSFORMERS.

 Notwithstanding any other provision of law, or rule promulgated by 

the Environmental Protection Agency, vegetable oil made from soybeans 

and used in electric transformers as thermal insulation shall not be 

regulated as an oil identified under section 2(a)(1)(B) of the Edible 

Oil Regulatory Reform Act (33 U.S.C. 2720(a)(1)(B)).

SEC. 1404. PETROCHEMICAL AND OIL REFINERY FACILITY HEALTH ASSESSMENT.

 (a) Establishment.--The Secretary shall conduct a study of direct 

and significant health impacts to persons resulting from living in 

proximity to petrochemical and oil refinery facilities. The Secretary 

shall consult with the Director of the National Cancer Institute and 

other Federal Government bodies with expertise in

[[Page 119 STAT. 1062]]

the field it deems appropriate in the design of such study. The study 

shall be conducted according to sound and objective scientific practices 

and present the weight of the scientific evidence. The Secretary shall 

obtain scientific peer review of the draft study.

 (b) Report to Congress.--The Secretary shall transmit the results of 

the study to Congress within 6 months of the enactment of this section.

 (c) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary for activities under this section such 

sums as are necessary for the completion of the study.

SEC. 1405. <<NOTE: 42 USC 16493.>> NATIONAL PRIORITY PROJECT 

 DESIGNATION.

 (a) Designation of National Priority Projects.--

 (1) In general.--There is established the National Priority 

 Project Designation (referred to in this section as the 

 ``Designation''), which shall be evidenced by a medal bearing 

 the inscription ``National Priority Project''.

 (2) Design and materials.--The medal shall be of such design 

 and materials and bear such additional inscriptions as the 

 President may prescribe.

 (b) Making <<NOTE: President.>> and Presentation of Designation.--

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 (1) In general.--The President, on the basis of 

 recommendations made by the Secretary, shall annually designate 

 organizations that have--

 (A) advanced the field of renewable energy 

 technology and contributed to North American energy 

 independence; and

 (B) <<NOTE: Certification.>> been certified by the 

 Secretary under subsection (e).

 (2) Presentation.--The President shall designate projects 

 with such ceremonies as the President may prescribe.

 (3) Use of designation.--An organization that receives a 

 Designation under this section may publicize the Designation of 

 the organization as a National Priority Project in advertising.

 (4) Categories in which the designation may be given.--

 Separate Designations shall be made to qualifying projects in 

 each of the following categories:

 (A) Wind and biomass energy generation projects.

 (B) Photovoltaic and fuel cell energy generation 

 projects.

 (C) Energy efficient building and renewable energy 

 projects.

 (D) First-in-Class projects.

 (c) Selection Criteria.--

 (1) In general.--Certification and selection of the projects 

 to receive the Designation shall be based on criteria 

 established under this subsection.

 (2) Wind, biomass, and building projects.--In the case of a 

 wind, biomass, or building project, the project shall 

 demonstrate that the project will install not less than 30 

 megawatts of renewable energy generation capacity.

 (3) Solar photovoltaic and fuel cell projects.--In the case 

 of a solar photovoltaic or fuel cell project, the project shall 

 demonstrate that the project will install not less than 3 

 megawatts of renewable energy generation capacity.

[[Page 119 STAT. 1063]]

 (4) Energy efficient building and renewable energy 

 projects.--In the case of an energy efficient building or 

 renewable energy project, in addition to meeting the criteria 

 established under paragraph (2), each building project shall 

 demonstrate that the project will--

 (A) comply with third-party certification standards 

 for high-performance, sustainable buildings;

 (B) use whole-building integration of energy 

 efficiency and environmental performance design and 

 technology, including advanced building controls;

 (C) use renewable energy for at least 50 percent of 

 the energy consumption of the project;

 (D) comply with applicable Energy Star standards; 

 and

 (E) include at least 5,000,000 square feet of 

 enclosed space.

 (5) First-in-class use.--Notwithstanding paragraphs (2) 

 through (4), a new building project may qualify under this 

 section if the Secretary determines that the project--

 (A) represents a First-In-Class use of renewable 

 energy; or

 (B) otherwise establishes a new paradigm of building 

 integrated renewable energy use or energy efficiency.

 (d) Application.--

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 (1) Initial applications.--No <<NOTE: Deadline. Federal 

 Register, publication. Guidelines.>> later than 120 days after 

 the date of enactment of this Act, and annually thereafter, the 

 Secretary shall publish in the Federal Register an invitation 

 and guidelines for submitting applications, consistent with this 

 section.

 (2) Contents.--The application shall describe the project, 

 or planned project, and the plans to meet the criteria 

 established under subsection (c).

 (e) Certification.--

 (1) In general.--Not <<NOTE: Deadline.>> later than 60 days 

 after the application period described in subsection (d), and 

 annually thereafter, the Secretary shall certify projects that 

 are reasonably expected to meet the criteria established under 

 subsection (c).

 (2) Certified projects.--The Secretary shall designate 

 personnel of the Department to work with persons carrying out 

 each certified project and ensure that the personnel--

 (A) provide each certified project with guidance in 

 meeting the criteria established under subsection (c);

 (B) identify programs of the Department, including 

 National Laboratories and Technology Centers, that will 

 assist each project in meeting the criteria established 

 under subsection (c); and

 (C) ensure that knowledge and transfer of the most 

 current technology between the applicable resources of 

 the Federal Government (including the National 

 Laboratories and Technology Centers, the Department, and 

 the Environmental Protection Agency) and the certified 

 projects is being facilitated to accelerate 

 commercialization of work developed through those 

 resources.

 (f) Authorization of Appropriations.--There are authorized to be 

appropriated such sums as are necessary to carry out this section for 

each of fiscal years 2006 through 2010.

[[Page 119 STAT. 1064]]

SEC. 1406. COLD CRACKING.

 (a) Study.--The Secretary shall conduct a study of the application 

of radiation to petroleum at standard temperature and pressure to refine 

petroleum products, whose objective shall be to increase the economic 

yield from each barrel of oil.

 (b) Goals.--The goals of the study shall include--

 (1) increasing the value of our current oil supply;

 (2) reducing the capital investment cost for cracking oil;

 (3) reducing the operating energy cost for cracking oil; and

 (4) reducing sulfur content using an environmentally 

 responsible method.

 (c) Authorization of Appropriations.--There are authorized to be 

appropriated to carry out this section $250,000 for fiscal year 2006.

SEC. 1407. <<NOTE: 42 USC 16494.>> OXYGEN-FUEL.

 (a) Program.--The Secretary shall establish a program on oxygen-fuel 

systems. If feasible, the program shall include renovation of at least 

one existing large unit and one existing small unit, and construction of 

one new large unit and one new small unit.

 (b) Authorization of Appropriations.--There are authorized to be 

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appropriated to the Secretary for carrying out this section--

 (1) $100,000,000 for fiscal year 2006;

 (2) $100,000,000 for fiscal year 2007; and

 (3) $100,000,000 for fiscal year 2008.

 (c) Definitions.--For purposes of this section--

 (1) the term ``large unit'' means a unit with a generating 

 capacity of 100 megawatts or more;

 (2) the term ``oxygen-fuel systems'' means systems that 

 utilize fuel efficiency benefits of oil, gas, coal, and biomass 

 combustion using substantially pure oxygen, with high flame 

 temperatures and the exclusion of air from the boiler, in 

 industrial or electric utility steam generating units; and

 (3) the term ``small unit'' means a unit with a generating 

 capacity in the 10-50 megawatt range.

 Subtitle B--Set <<NOTE: Set America Free Act of 

2005. Canada. Mexico.>> America Free

SEC. 1421. SHORT TITLE.

 This subtitle may be cited as the ``Set America Free Act of 2005'' 

or the ``SAFE Act''.

SEC. 1422. PURPOSE.

 The purpose of this subtitle is to establish a United States 

commission to make recommendations for a coordinated and comprehensive 

North American energy policy that will achieve energy self-sufficiency 

by 2025 within the three contiguous North American nation area of 

Canada, Mexico, and the United States.

SEC. 1423. UNITED STATES COMMISSION ON NORTH AMERICAN ENERGY FREEDOM.

 (a) Establishment.--There is hereby established the United States 

Commission on North American Energy Freedom (in this subtitle referred 

to as the ``Commission''). The Federal Advisory

[[Page 119 STAT. 1065]]

Committee Act (5 U.S.C. App.), except sections 3, 7, and 12, does not 

apply to the Commission.

 (b) <<NOTE: President.>> Membership.--

 (1) Appointment.--The Commission shall be composed of 16 

 members appointed by the President from among individuals 

 described in paragraph (2) who are knowledgeable on energy 

 issues, including oil and gas exploration and production, crude 

 oil refining, oil and gas pipelines, electricity production and 

 transmission, coal, unconventional hydrocarbon resources, fuel 

 cells, motor vehicle power systems, nuclear energy, renewable 

 energy, biofuels, energy efficiency, and energy conservation. 

 The membership of the Commission shall be balanced by area of 

 expertise to the extent consistent with maintaining the highest 

 level of expertise on the Commission. Members of the Commission 

 may be citizens of Canada, Mexico, or the United States, and the 

 President shall ensure that citizens of all three nations are 

 appointed to the Commission.

 (2) Nominations.--The <<NOTE: Deadline.>> President shall 

 appoint the members of the Commission within 60 days after the 

 effective date of this Act, including individuals nominated as 

 follows:

 (A) Four members shall be appointed from amongst 

 individuals independently determined by the President to 

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 be qualified for appointment.

 (B) Four members shall be appointed from a list of 

 eight individuals who shall be nominated by the majority 

 leader of the Senate in consultation with the chairman 

 of the Committee on Energy and Natural Resources of the 

 Senate.

 (C) Four members shall be appointed from a list of 

 eight individuals who shall be nominated by the Speaker 

 of the House of Representatives in consultation with the 

 chairmen of the Committees on Energy and Commerce and 

 Resources of the House of Representatives.

 (D) Two members shall be appointed from a list of 

 four individuals who shall be nominated by the minority 

 leader of the Senate in consultation with the ranking 

 Member of the Committee on Energy and Natural Resources 

 of the Senate.

 (E) Two members shall be appointed from a list of 

 four individuals who shall be nominated by the minority 

 leader of the House in consultation with the ranking 

 Members of the Committees on Energy and Commerce and 

 Resources of the House of Representatives.

 (3) Chairman.--The chairman of the Commission shall be 

 selected by the President. The chairman of the Commission shall 

 be responsible for--

 (A) the assignment of duties and responsibilities 

 among staff personnel and their continuing supervision; 

 and

 (B) the use and expenditure of funds available to 

 the Commission.

 (4) Vacancies.--Any vacancy on the Commission shall be 

 filled in the same manner as the original incumbent was 

 appointed.

 (c) Resources.--In carrying out its functions under this section, 

the Commission--

 (1) is authorized to secure directly from any Federal agency 

 or department any information it deems necessary to carry

[[Page 119 STAT. 1066]]

 out its functions under this Act, and each such agency or 

 department is authorized to cooperate with the Commission and, 

 to the extent permitted by law, to furnish such information 

 (other than information described in section 552(b)(1)(A) of 

 title 5, United States Code) to the Commission, upon the request 

 of the Commission;

 (2) may enter into contracts, subject to the availability of 

 appropriations for contracting, and employ such staff experts 

 and consultants as may be necessary to carry out the duties of 

 the Commission, as provided by section 3109 of title 5, United 

 States Code; and

 (3) <<NOTE: Establishment.>> shall establish a 

 multidisciplinary science and technical advisory panel of 

 experts in the field of energy to assist the Commission in 

 preparing its report, including ensuring that the scientific and 

 technical information considered by the Commission is based on 

 the best scientific and technical information available.

 (d) Staffing.--The chairman of the Commission may, without regard to 

the civil service laws and regulations, appoint and terminate an 

executive director and such other additional personnel as may be 

necessary for the Commission to perform its duties. The executive 

director shall be compensated at a rate not to exceed the rate payable 

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for Level IV of the Executive Schedule under chapter 5136 of title 5, 

United States Code. The chairman shall select staff from among qualified 

citizens of Canada, Mexico, and the United States of America.

 (e) Meetings.--

 (1) Administration.--All meetings of the Commission shall be 

 open to the public, except that a meeting or any portion of it 

 may be closed to the public if it concerns matters or 

 information described in section 552b(c) of title 5, United 

 States Code. Interested persons shall be permitted to appear at 

 open meetings and present oral or written statements on the 

 subject matter of the meeting. The Commission may administer 

 oaths or affirmations to any person appearing before it.

 (2) Notice; minutes; public availability of documents.--

 (A) Notice.--All open meetings of the Commission 

 shall be preceded by timely public notice in the Federal 

 Register of the time, place, and subject of the meeting.

 (B) Minutes.--Minutes of each meeting shall be kept 

 and shall contain a record of the people present, a 

 description of the discussion that occurred, and copies 

 of all statements filed. Subject to section 552 of title 

 5, United States Code, the minutes and records of all 

 meetings and other documents that were made available to 

 or prepared for the Commission shall be available for 

 public inspection and copying at a single location in 

 the offices of the Commission.

 (3) Initial meeting.--The <<NOTE: Deadline.>> Commission 

 shall hold its first meeting within 30 days after all 16 members 

 have been appointed.

 (f) Report.--Within 12 months after the effective date of this Act, 

the Commission shall submit to Congress and the President a final report 

of its findings and recommendations regarding North American energy 

freedom.

[[Page 119 STAT. 1067]]

 (g) Administrative Procedure for Report and Review.--Chapter 5 and 

chapter 7 of title 5, United States Code, do not apply to the 

preparation, review, or submission of the report required by subsection 

(f).

 (h) Termination.--The Commission shall cease to exist 90 days after 

the date on which it submits its final report.

 (i) Authorization of Appropriations.--There is authorized to be 

appropriated to carry out this chapter a total of $10,000,000 for the 2 

fiscal-year period beginning with fiscal year 2005, such sums to remain 

available until expended.

SEC. 1424. <<NOTE: Deadline. President.>> NORTH AMERICAN ENERGY FREEDOM 

 POLICY.

 Within 90 days after receiving and considering the report and 

recommendations of the Commission under section 1423, the President 

shall submit to Congress a statement of proposals to implement or 

respond to the Commission's recommendations for a coordinated, 

comprehensive, and long-range national policy to achieve North American 

energy freedom by 2025.

 TITLE XV--ETHANOL AND MOTOR FUELS

 Subtitle A--General Provisions

SEC. 1501. RENEWABLE CONTENT OF GASOLINE.

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 (a) In General.--Section 211 of the Clean Air Act (42 U.S.C. 7545) 

is amended--

 (1) by redesignating subsection (o) as subsection (r); and

 (2) by inserting after subsection (n) the following:

 ``(o) Renewable Fuel Program.--

 ``(1) Definitions.--In this section:

 ``(A) Cellulosic biomass ethanol.--The term 

 `cellulosic biomass ethanol' means ethanol derived from 

 any lignocellulosic or hemicellulosic matter that is 

 available on a renewable or recurring basis, including--

 ``(i) dedicated energy crops and trees;

 ``(ii) wood and wood residues;

 ``(iii) plants;

 ``(iv) grasses;

 ``(v) agricultural residues;

 ``(vi) fibers;

 ``(vii) animal wastes and other waste 

 materials; and

 ``(viii) municipal solid waste.

 The term also includes any ethanol produced in 

 facilities where animal wastes or other waste materials 

 are digested or otherwise used to displace 90 percent or 

 more of the fossil fuel normally used in the production 

 of ethanol.

 ``(B) Waste derived ethanol.--The term `waste 

 derived ethanol' means ethanol derived from--

 ``(i) animal wastes, including poultry fats 

 and poultry wastes, and other waste materials; or

 ``(ii) municipal solid waste.

 ``(C) Renewable fuel.--

[[Page 119 STAT. 1068]]

 ``(i) In general.--The term `renewable fuel' 

 means motor vehicle fuel that--

 ``(I)(aa) is produced from grain, 

 starch, oilseeds, vegetable, animal, or 

 fish materials including fats, greases, 

 and oils, sugarcane, sugar beets, sugar 

 components, tobacco, potatoes, or other 

 biomass; or

 ``(bb) is natural gas produced from 

 a biogas source, including a landfill, 

 sewage waste treatment plant, feedlot, 

 or other place where decaying organic 

 material is found; and

 ``(II) is used to replace or reduce 

 the quantity of fossil fuel present in a 

 fuel mixture used to operate a motor 

 vehicle.

 ``(ii) Inclusion.--The term `renewable fuel' 

 includes--

 ``(I) cellulosic biomass ethanol and 

 `waste derived ethanol'; and

 ``(II) biodiesel (as defined in 

 section 312(f) of the Energy Policy Act 

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

 blending components derived from 

 renewable fuel (provided that only the 

 renewable fuel portion of any such 

 blending component shall be considered 

 part of the applicable volume under the 

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 renewable fuel program established by 

 this subsection).

 ``(D) Small refinery.--The term `small refinery' 

 means a refinery for which the average aggregate daily 

 crude oil throughput for a calendar year (as determined 

 by dividing the aggregate throughput for the calendar 

 year by the number of days in the calendar year) does 

 not exceed 75,000 barrels.

 ``(2) Renewable fuel program.--

 ``(A) Regulations.--

 ``(i) In general.--

 Not <<NOTE: Deadline.>> later than 1 year after 

 the date of enactment of this paragraph, the 

 Administrator shall promulgate regulations to 

 ensure that gasoline sold or introduced into 

 commerce in the United States (except in 

 noncontiguous States or territories), on an annual 

 average basis, contains the applicable volume of 

 renewable fuel determined in accordance with 

 subparagraph (B).

 ``(ii) Noncontiguous state opt-in.--

 ``(I) In general.--On the petition 

 of a noncontiguous State or territory, 

 the Administrator may allow the 

 renewable fuel program established under 

 this subsection to apply in the 

 noncontiguous State or territory at the 

 same time or any time after the 

 Administrator promulgates regulations 

 under this subparagraph.

 ``(II) Other actions.--In carrying 

 out this clause, the Administrator may--

 ``(aa) issue or revise 

 regulations under this 

 paragraph;

 ``(bb) establish applicable 

 percentages under paragraph (3);

[[Page 119 STAT. 1069]]

 ``(cc) provide for the 

 generation of credits under 

 paragraph (5); and

 ``(dd) take such other 

 actions as are necessary to 

 allow for the application of the 

 renewable fuels program in a 

 noncontiguous State or 

 territory.

 ``(iii) Provisions of regulations.--Regardless 

 of the date of promulgation, the regulations 

 promulgated under clause (i)--

 ``(I) shall contain compliance 

 provisions applicable to refineries, 

 blenders, distributors, and importers, 

 as appropriate, to ensure that the 

 requirements of this paragraph are met; 

 but

 ``(II) shall not--

 ``(aa) restrict geographic 

 areas in which renewable fuel 

 may be used; or

 ``(bb) impose any per-gallon 

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 obligation for the use of 

 renewable fuel.

 ``(iv) Requirement in case of failure to 

 promulgate regulations.--If the Administrator does 

 not promulgate regulations under clause (i), the 

 percentage of renewable fuel in gasoline sold or 

 dispensed to consumers in the United States, on a 

 volume basis, shall be 2.78 percent for calendar 

 year 2006.

 ``(B) Applicable volume.--

 ``(i) Calendar years 2006 through 2012.--For 

 the purpose of subparagraph (A), the applicable 

 volume for any of calendar years 2006 through 2012 

 shall be determined in accordance with the 

 following table:

 Applicable volume of renewable fuel.......

 ``Calendar yea(in billions of gallons):.................

 2006 4.0

 2007 4.7

 2008 5.4

 2009 6.1

 2010 6.8

 2011 7.4

 2012 7.5.

 ``(ii) Calendar year 2013 and thereafter.--

 Subject to clauses (iii) and (iv), for the 

 purposes of subparagraph (A), the applicable 

 volume for calendar year 2013 and each calendar 

 year thereafter shall be determined by the 

 Administrator, in coordination with the Secretary 

 of Agriculture and the Secretary of Energy, based 

 on a review of the implementation of the program 

 during calendar years 2006 through 2012, including 

 a review of--

 ``(I) the impact of the use of 

 renewable fuels on the environment, air 

 quality, energy security, job creation, 

 and rural economic development; and

 ``(II) the expected annual rate of 

 future production of renewable fuels, 

 including cellulosic ethanol.

[[Page 119 STAT. 1070]]

 ``(iii) Minimum quantity derived from 

 cellulosic biomass.--For calendar year 2013 and 

 each calendar year thereafter--

 ``(I) the applicable volume referred 

 to in clause (ii) shall contain a 

 minimum of 250,000,000 gallons that are 

 derived from cellulosic biomass; and

 ``(II) the 2.5-to-1 ratio referred 

 to in paragraph (4) shall not apply.

 ``(iv) Minimum applicable volume.--For the 

 purpose of subparagraph (A), the applicable volume 

 for calendar year 2013 and each calendar year 

 thereafter shall be equal to the product obtained 

 by multiplying--

 ``(I) the number of gallons of 

 gasoline that the Administrator 

 estimates will be sold or introduced 

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 into commerce in the calendar year; and

 ``(II) the ratio that--

 ``(aa) 7,500,000,000 gallons 

 of renewable fuel; bears to

 ``(bb) the number of gallons 

 of gasoline sold or introduced 

 into commerce in calendar year 

 2012.

 ``(3) Applicable <<NOTE: Deadlines.>> percentages.--

 ``(A) Provision of estimate of volumes of gasoline 

 sales.--Not later than October 31 of each of calendar 

 years 2005 through 2011, the Administrator of the Energy 

 Information Administration shall provide to the 

 Administrator of the Environmental Protection Agency an 

 estimate, with respect to the following calendar year, 

 of the volumes of gasoline projected to be sold or 

 introduced into commerce in the United States.

 ``(B) Determination of applicable percentages.--

 ``(i) In general.--Not later than November 30 

 of each of calendar years 2005 through 2012, based 

 on the estimate provided under subparagraph (A), 

 the Administrator of the Environmental Protection 

 Agency shall determine and publish in the Federal 

 Register, with respect to the following calendar 

 year, the renewable fuel obligation that ensures 

 that the requirements of paragraph (2) are met.

 ``(ii) Required elements.--The renewable fuel 

 obligation determined for a calendar year under 

 clause (i) shall--

 ``(I) be applicable to refineries, 

 blenders, and importers, as appropriate;

 ``(II) be expressed in terms of a 

 volume percentage of gasoline sold or 

 introduced into commerce in the United 

 States; and

 ``(III) subject to subparagraph 

 (C)(i), consist of a single applicable 

 percentage that applies to all 

 categories of persons specified in 

 subclause (I).

 ``(C) Adjustments.--In determining the applicable 

 percentage for a calendar year, the Administrator shall 

 make adjustments--

 ``(i) to prevent the imposition of redundant 

 obligations on any person specified in 

 subparagraph (B)(ii)(I); and

[[Page 119 STAT. 1071]]

 ``(ii) to account for the use of renewable 

 fuel during the previous calendar year by small 

 refineries that are exempt under paragraph (9).

 ``(4) Cellulosic biomass ethanol or waste derived ethanol.--

 For the purpose of paragraph (2), 1 gallon of cellulosic biomass 

 ethanol or waste derived ethanol shall be considered to be the 

 equivalent of 2.5 gallons of renewable fuel.

 ``(5) Credit program.--

 ``(A) In general.--The regulations promulgated under 

 paragraph (2)(A) shall provide--

 ``(i) for the generation of an appropriate 

 amount of credits by any person that refines, 

 blends, or imports gasoline that contains a 

 quantity of renewable fuel that is greater than 

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 the quantity required under paragraph (2);

 ``(ii) for the generation of an appropriate 

 amount of credits for biodiesel; and

 ``(iii) for the generation of credits by small 

 refineries in accordance with paragraph (9)(C).

 ``(B) Use of credits.--A person that generates 

 credits under subparagraph (A) may use the credits, or 

 transfer all or a portion of the credits to another 

 person, for the purpose of complying with paragraph (2).

 ``(C) Duration of credits.--A credit generated under 

 this paragraph shall be valid to show compliance for the 

 12 months as of the date of generation.

 ``(D) Inability to generate or purchase sufficient 

 credits.--The regulations promulgated under paragraph 

 (2)(A) shall include provisions allowing any person that 

 is unable to generate or purchase sufficient credits to 

 meet the requirements of paragraph (2) to carry forward 

 a renewable fuel deficit on condition that the person, 

 in the calendar year following the year in which the 

 renewable fuel deficit is created--

 ``(i) achieves compliance with the renewable 

 fuel requirement under paragraph (2); and

 ``(ii) generates or purchases additional 

 renewable fuel credits to offset the renewable 

 fuel deficit of the previous year.

 ``(6) Seasonal variations in renewable fuel use.--

 ``(A) Study.--For each of calendar years 2006 

 through 2012, the Administrator of the Energy 

 Information Administration shall conduct a study of 

 renewable fuel blending to determine whether there are 

 excessive seasonal variations in the use of renewable 

 fuel.

 ``(B) Regulation of excessive seasonal variations.--

 If, for any calendar year, the Administrator of the 

 Energy Information Administration, based on the study 

 under subparagraph (A), makes the determinations 

 specified in subparagraph (C), the Administrator of the 

 Environmental Protection Agency shall promulgate 

 regulations to ensure that 25 percent or more of the 

 quantity of renewable fuel necessary to meet the 

 requirements of paragraph (2) is used during each of the 

 2 periods specified in subparagraph (D) of each 

 subsequent calendar year.

 ``(C) Determinations.--The determinations referred 

 to in subparagraph (B) are that--

[[Page 119 STAT. 1072]]

 ``(i) less than 25 percent of the quantity of 

 renewable fuel necessary to meet the requirements 

 of paragraph (2) has been used during 1 of the 2 

 periods specified in subparagraph (D) of the 

 calendar year;

 ``(ii) a pattern of excessive seasonal 

 variation described in clause (i) will continue in 

 subsequent calendar years; and

 ``(iii) promulgating regulations or other 

 requirements to impose a 25 percent or more 

 seasonal use of renewable fuels will not prevent 

 or interfere with the attainment of national 

 ambient air quality standards or significantly 

 increase the price of motor fuels to the consumer.

 ``(D) Periods.--The 2 periods referred to in this 

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 paragraph are--

 ``(i) April through September; and

 ``(ii) January through March and October 

 through December.

 ``(E) Exclusion.--Renewable fuel blended or consumed 

 in calendar year 2006 in a State that has received a 

 waiver under section 209(b) shall not be included in the 

 study under subparagraph (A).

 ``(F) State exemption from seasonality 

 requirements.--Notwithstanding any other provision of 

 law, the seasonality requirement relating to renewable 

 fuel use established by this paragraph shall not apply 

 to any State that has received a waiver under section 

 209(b) or any State dependent on refineries in such 

 State for gasoline supplies.

 ``(7) Waivers.--

 ``(A) In general.--The Administrator, in 

 consultation with the Secretary of Agriculture and the 

 Secretary of Energy, may waive the requirements of 

 paragraph (2) in whole or in part on petition by one or 

 more States by reducing the national quantity of 

 renewable fuel required under paragraph (2)--

 ``(i) based on a determination by the 

 Administrator, after public notice and opportunity 

 for comment, that implementation of the 

 requirement would severely harm the economy or 

 environment of a State, a region, or the United 

 States; or

 ``(ii) based on a determination by the 

 Administrator, after public notice and opportunity 

 for comment, that there is an inadequate domestic 

 supply.

 ``(B) Petitions for waivers.--

 The <<NOTE: Deadline.>> Administrator, in consultation 

 with the Secretary of Agriculture and the Secretary of 

 Energy, shall approve or disapprove a State petition for 

 a waiver of the requirements of paragraph (2) within 90 

 days after the date on which the petition is received by 

 the Administrator.

 ``(C) Termination of waivers.--A waiver granted 

 under subparagraph (A) shall terminate after 1 year, but 

 may be renewed by the Administrator after consultation 

 with the Secretary of Agriculture and the Secretary of 

 Energy.

 ``(8) Study and waiver for initial year of program.--

[[Page 119 STAT. 1073]]

 ``(A) In general.--Not <<NOTE: Deadline.>> later 

 than 180 days after the date of enactment of this 

 paragraph, the Secretary of Energy shall conduct for the 

 Administrator a study assessing whether the renewable 

 fuel requirement under paragraph (2) will likely result 

 in significant adverse impacts on consumers in 2006, on 

 a national, regional, or State basis.

 ``(B) Required evaluations.--The study shall 

 evaluate renewable fuel--

 ``(i) supplies and prices;

 ``(ii) blendstock supplies; and

 ``(iii) supply and distribution system 

 capabilities.

 ``(C) Recommendations by the secretary.--Based on 

 the results of the study, the Secretary of Energy shall 

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 make specific recommendations to the Administrator 

 concerning waiver of the requirements of paragraph (2), 

 in whole or in part, to prevent any adverse impacts 

 described in subparagraph (A).

 ``(D) Waiver.--

 ``(i) In general.--

 Not <<NOTE: Deadline.>> later than 270 days after 

 the date of enactment of this paragraph, the 

 Administrator shall, if and to the extent 

 recommended by the Secretary of Energy under 

 subparagraph (C), waive, in whole or in part, the 

 renewable fuel requirement under paragraph (2) by 

 reducing the national quantity of renewable fuel 

 required under paragraph (2) in calendar year 

 2006.

 ``(ii) No effect on waiver authority.--Clause 

 (i) does not limit the authority of the 

 Administrator to waive the requirements of 

 paragraph (2) in whole, or in part, under 

 paragraph (7).

 ``(9) Small refineries.--

 ``(A) Temporary exemption.--

 ``(i) In general.--The requirements of 

 paragraph (2) shall not apply to small refineries 

 until calendar year 2011.

 ``(ii) Extension of exemption.--

 ``(I) <<NOTE: Deadline.>> Study by 

 secretary of energy.--Not later than 

 December 31, 2008, the Secretary of 

 Energy shall conduct for the 

 Administrator a study to determine 

 whether compliance with the requirements 

 of paragraph (2) would impose a 

 disproportionate economic hardship on 

 small refineries.

 ``(II) Extension of exemption.--In 

 the case of a small refinery that the 

 Secretary of Energy determines under 

 subclause (I) would be subject to a 

 disproportionate economic hardship if 

 required to comply with paragraph (2), 

 the Administrator shall extend the 

 exemption under clause (i) for the small 

 refinery for a period of not less than 2 

 additional years.

 ``(B) Petitions based on disproportionate economic 

 hardship.--

 ``(i) Extension of exemption.--A small 

 refinery may at any time petition the 

 Administrator for an extension of the exemption 

 under subparagraph (A) for the reason of 

 disproportionate economic hardship.

[[Page 119 STAT. 1074]]

 ``(ii) Evaluation of petitions.--In evaluating 

 a petition under clause (i), the Administrator, in 

 consultation with the Secretary of Energy, shall 

 consider the findings of the study under 

 subparagraph (A)(ii) and other economic factors.

 ``(iii) Deadline for action on petitions.--The 

 Administrator shall act on any petition submitted 

 by a small refinery for a hardship exemption not 

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 later than 90 days after the date of receipt of 

 the petition.

 ``(C) Credit program.--If a small refinery notifies 

 the Administrator that the small refinery waives the 

 exemption under subparagraph (A), the regulations 

 promulgated under paragraph (2)(A) shall provide for the 

 generation of credits by the small refinery under 

 paragraph (5) beginning in the calendar year following 

 the date of notification.

 ``(D) Opt-in for small refineries.--A small refinery 

 shall be subject to the requirements of paragraph (2) if 

 the small refinery notifies the Administrator that the 

 small refinery waives the exemption under subparagraph 

 (A).

 ``(10) Ethanol market concentration analysis.--

 ``(A) Analysis.--

 ``(i) In general.--

 Not <<NOTE: Deadline.>> later than 180 days after 

 the date of enactment of this paragraph, and 

 annually thereafter, the Federal Trade Commission 

 shall perform a market concentration analysis of 

 the ethanol production industry using the 

 Herfindahl-Hirschman Index to determine whether 

 there is sufficient competition among industry 

 participants to avoid price-setting and other 

 anticompetitive behavior.

 ``(ii) Scoring.--For the purpose of scoring 

 under clause (i) using the Herfindahl-Hirschman 

 Index, all marketing arrangements among industry 

 participants shall be considered.

 ``(B) Report.--Not later than December 1, 2005, and 

 annually thereafter, the Federal Trade Commission shall 

 submit to Congress and the Administrator a report on the 

 results of the market concentration analysis performed 

 under subparagraph (A)(i).''.

 (b) Penalties and Enforcement.--Section 211(d) of the Clean Air Act 

(42 U.S.C. 7545(d)) is amended--

 (1) in paragraph (1)--

 (A) in the first sentence, by striking ``or (n)'' 

 each place it appears and inserting ``(n), or (o)''; and

 (B) in the second sentence, by striking ``or (m)'' 

 and inserting ``(m), or (o)''; and

 (2) in the first sentence of paragraph (2), by striking 

 ``and (n)'' each place it appears and inserting ``(n), and 

 (o)''.

 (c) Exclusion From Ethanol Waiver.--Section 211(h) of the Clean Air 

Act (42 U.S.C. 7545(h)) is amended--

 (1) by redesignating paragraph (5) as paragraph (6); and

 (2) by inserting after paragraph (4) the following:

 ``(5) Exclusion from ethanol waiver.--

 ``(A) Promulgation 

 of <<NOTE: Notification.>> regulations.--Upon 

 notification, accompanied by supporting documentation, 

 from the Governor of a State that the Reid vapor 

 pressure limitation established by paragraph (4) will 

 increase emissions that contribute to air pollution in 

 any area in the State, the

[[Page 119 STAT. 1075]]

 Administrator shall, by regulation, apply, in lieu of 

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 the Reid vapor pressure limitation established by 

 paragraph (4), the Reid vapor pressure limitation 

 established by paragraph (1) to all fuel blends 

 containing gasoline and 10 percent denatured anhydrous 

 ethanol that are sold, offered for sale, dispensed, 

 supplied, offered for supply, transported, or introduced 

 into commerce in the area during the high ozone season.

 ``(B) Deadline for promulgation.--The Administrator 

 shall promulgate regulations under subparagraph (A) not 

 later than 90 days after the date of receipt of a 

 notification from a Governor under that subparagraph.

 ``(C) Effective date.--

 ``(i) In general.--With respect to an area in 

 a State for which the Governor submits a 

 notification under subparagraph (A), the 

 regulations under that subparagraph shall take 

 effect on the later of--

 ``(I) the first day of the first 

 high ozone season for the area that 

 begins after the date of receipt of the 

 notification; or

 ``(II) 1 year after the date of 

 receipt of the notification.

 ``(ii) Extension of effective date based on 

 determination of insufficient supply.--

 ``(I) In general.--

 If, <<NOTE: Regulations.>> after receipt 

 of a notification with respect to an 

 area from a Governor of a State under 

 subparagraph (A), the Administrator 

 determines, on the Administrator's own 

 motion or on petition of any person and 

 after consultation with the Secretary of 

 Energy, that the promulgation of 

 regulations described in subparagraph 

 (A) would result in an insufficient 

 supply of gasoline in the State, the 

 Administrator, by regulation--

 ``(aa) shall extend the 

 effective date of the 

 regulations under clause (i) 

 with respect to the area for not 

 more than 1 year; and

 ``(bb) may renew the 

 extension under item (aa) for 

 two additional periods, each of 

 which shall not exceed 1 year.

 ``(II) Deadline for action on 

 petitions.--The Administrator shall act 

 on any petition submitted under 

 subclause (I) not later than 180 days 

 after the date of receipt of the 

 petition.''.

 (d) Survey <<NOTE: 47 USC 7545 note.>> of Renewable Fuel Market.--

 (1) Survey and report.--Not later than December 1, 2006, and 

 annually thereafter, the Administrator of the Environmental 

 Protection Agency (in consultation with the Secretary acting 

 through the Administrator of the Energy Information 

 Administration) shall--

 (A) conduct, with respect to each conventional 

 gasoline use area and each reformulated gasoline use 

 area in each State, a survey to determine the market 

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 shares of--

 (i) conventional gasoline containing ethanol;

 (ii) reformulated gasoline containing ethanol;

 (iii) conventional gasoline containing 

 renewable fuel; and

[[Page 119 STAT. 1076]]

 (iv) reformulated gasoline containing 

 renewable fuel; and

 (B) submit to Congress, and make publicly available, 

 a report on the results of the survey under subparagraph 

 (A).

 (2) Recordkeeping and reporting requirements.--The 

 Administrator of the Environmental Protection Agency 

 (hereinafter in this subsection referred to as the 

 ``Administrator'') may require any refiner, blender, or importer 

 to keep such records and make such reports as are necessary to 

 ensure that the survey conducted under paragraph (1) is 

 accurate. The Administrator, to avoid duplicative requirements, 

 shall rely, to the extent practicable, on existing reporting and 

 recordkeeping requirements and other information available to 

 the Administrator including gasoline distribution patterns that 

 include multistate use areas.

 (3) Applicable law.--Activities carried out under this 

 subsection shall be conducted in a manner designed to protect 

 confidentiality of individual responses.

SEC. 1502. <<NOTE: 42 USC 7545 note.>> FINDINGS.

 Congress finds that--

 (1) since 1979, methyl tertiary butyl ether (hereinafter in 

 this section referred to as ``MTBE'') has been used nationwide 

 at low levels in gasoline to replace lead as an octane booster 

 or anti-knocking agent;

 (2) Public Law 101-549 (commonly known as the ``Clean Air 

 Act Amendments of 1990'') (42 U.S.C. 7401 et seq.) established a 

 fuel oxygenate standard under which reformulated gasoline must 

 contain at least 2 percent oxygen by weight; and

 (3) the fuel industry responded to the fuel oxygenate 

 standard established by Public Law 101-549 by making substantial 

 investments in--

 (A) MTBE production capacity; and

 (B) systems to deliver MTBE-containing gasoline to 

 the marketplace.

SEC. 1503. <<NOTE: 42 USC 7545 note.>> CLAIMS FILED AFTER ENACTMENT.

 Claims and legal actions filed after the date of enactment of this 

Act related to allegations involving actual or threatened contamination 

of methyl tertiary butyl ether (MTBE) may be removed to the appropriate 

United States district court.

SEC. 1504. ELIMINATION OF OXYGEN CONTENT REQUIREMENT FOR REFORMULATED 

 GASOLINE.

 (a) Elimination.--

 (1) In general.--Section 211(k) of the Clean Air Act (42 

 U.S.C. 7545(k)) is amended--

 (A) in paragraph (2)--

 (i) in the second sentence of subparagraph 

 (A), by striking ``(including the oxygen content 

 requirement contained in subparagraph (B))'';

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 (ii) by striking subparagraph (B); and

 (iii) by redesignating subparagraphs (C) and 

 (D) as subparagraphs (B) and (C), respectively;

 (B) in paragraph (3)(A), by striking clause (v); and

 (C) in paragraph (7)--

[[Page 119 STAT. 1077]]

 (i) in subparagraph (A)--

 (I) by striking clause (i); and

 (II) by redesignating clauses (ii) 

 and (iii) as clauses (i) and (ii), 

 respectively; and

 (ii) in subparagraph (C)--

 (I) by striking clause (ii); and

 (II) by redesignating clause (iii) 

 as clause (ii).

 (2) Applicability.--The <<NOTE: Effective dates. 42 USC 7545 

 note.>> amendments made by paragraph (1) apply--

 (A) in the case of a State that has received a 

 waiver under section 209(b) of the Clean Air Act (42 

 U.S.C. 7543(b)), beginning on the date of enactment of 

 this Act; and

 (B) in the case of any other State, beginning 270 

 days after the date of enactment of this Act.

 (b) Maintenance of Toxic Air Pollutant Emission Reductions.--Section 

211(k)(1) of the Clean Air Act (42 U.S.C. 7545(k)(1)) is amended--

 (1) by striking ``Within 1 year after the enactment of the 

 Clean Air Act Amendments of 1990,'' and inserting the following:

 ``(A) In general.--Not <<NOTE: Deadline.>> later 

 than November 15, 1991,''; and

 (2) by adding at the end the following:

 ``(B) Maintenance of toxic air pollutant emissions 

 reductions from reformulated gasoline.--

 ``(i) Definition of padd.--In this 

 subparagraph the term `PADD' means a Petroleum 

 Administration for Defense District.

 ``(ii) 

 Regulations <<NOTE: Deadline.>> concerning 

 emissions of toxic air pollutants.--Not later than 

 270 days after the date of enactment of this 

 subparagraph, the Administrator shall establish by 

 regulation, for each refinery or importer (other 

 than a refiner or importer in a State that has 

 received a waiver under section 209(b) with 

 respect to gasoline produced for use in that 

 State), standards for toxic air pollutants from 

 use of the reformulated gasoline produced or 

 distributed by the refiner or importer that 

 maintain the reduction of the average annual 

 aggregate emissions of toxic air pollutants for 

 reformulated gasoline produced or distributed by 

 the refiner or importer during calendar years 2001 

 and 2002 (as determined on the basis of data 

 collected by the Administrator with respect to the 

 refiner or importer).

 ``(iii) Standards applicable to specific 

 refineries or importers.--

 ``(I) Applicability of standards.--

 For any calendar year, the standards 

 applicable to a refiner or importer 

 under clause (ii) shall apply to the 

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 quantity of gasoline produced or 

 distributed by the refiner or importer 

 in the calendar year only to the extent 

 that the quantity is less than or equal 

 to the average annual quantity of 

 reformulated gasoline produced or 

 distributed by the refiner or importer 

 during calendar years 2001 and 2002.

[[Page 119 STAT. 1078]]

 ``(II) Applicability of other 

 standards.--For any calendar year, the 

 quantity of gasoline produced or 

 distributed by a refiner or importer 

 that is in excess of the quantity 

 subject to subclause (I) shall be 

 subject to standards for emissions of 

 toxic air pollutants promulgated under 

 subparagraph (A) and paragraph (3)(B).

 ``(iv) Credit program.--The Administrator 

 shall provide for the granting and use of credits 

 for emissions of toxic air pollutants in the same 

 manner as provided in paragraph (7).

 ``(v) Regional protection of toxics reduction 

 baselines.--

 ``(I) In general.--

 Not <<NOTE: Deadlines. Federal 

 Register, publication. Reports.>> later 

 than 60 days after the date of enactment 

 of this subparagraph, and not later than 

 April 1 of each calendar year that 

 begins after that date of enactment, the 

 Administrator shall publish in the 

 Federal Register a report that 

 specifies, with respect to the previous 

 calendar year--

 ``(aa) the quantity of 

 reformulated gasoline produced 

 that is in excess of the average 

 annual quantity of reformulated 

 gasoline produced in 2001 and 

 2002; and

 ``(bb) the reduction of the 

 average annual aggregate 

 emissions of toxic air 

 pollutants in each PADD, based 

 on retail survey data or data 

 from other appropriate sources.

 ``(II) Effect of failure to maintain 

 aggregate toxics reductions.--If, in any 

 calendar year, the reduction of the 

 average annual aggregate emissions of 

 toxic air pollutants in a PADD fails to 

 meet or exceed the reduction of the 

 average annual aggregate emissions of 

 toxic air pollutants in the PADD in 

 calendar years 2001 and 2002, the 

 Administrator, not later than 90 days 

 after the date of publication of the 

 report for the calendar year under 

 subclause (I), shall--

 ``(aa) identify, to the 

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 maximum extent practicable, the 

 reasons for the failure, 

 including the sources, volumes, 

 and characteristics of 

 reformulated gasoline that 

 contributed to the failure; and

 ``(bb) <<NOTE: Effective 

 dates. Regulations.>> promulgate 

 revisions to the regulations 

 promulgated under clause (ii), 

 to take effect not earlier than 

 180 days but not later than 270 

 days after the date of 

 promulgation, to provide that, 

 notwithstanding clause 

 (iii)(II), all reformulated 

 gasoline produced or distributed 

 at each refiner or importer 

 shall meet the standards 

 applicable under clause (iii)(I) 

 beginning not later than April 1 

 of the calendar year following 

 publication of the report under 

 subclause (I) and in each 

 calendar year thereafter.

 ``(vi) <<NOTE: Deadline. Regulations.>> Not 

 later than July 1, 2007, the Administrator shall 

 promulgate final regulations to control hazardous

[[Page 119 STAT. 1079]]

 air pollutants from motor vehicles and motor 

 vehicle fuels, as provided for in section 80.1045 

 of title 40, Code of Federal Regulations (as in 

 effect on the date of enactment of this 

 subparagraph), and as authorized under section 

 202(1) of the Clean Air Act. If the Administrator 

 promulgates by such date, final regulations to 

 control hazardous air pollutants from motor 

 vehicles and motor vehicle fuels that achieve and 

 maintain greater overall reductions in emissions 

 of air toxics from reformulated gasoline than the 

 reductions that would be achieved under section 

 211(k)(1)(B) of the Clean Air Act as amended by 

 this clause, then sections 211(k)(1)(B)(i) through 

 211(k)(1)(B)(v) shall be null and void and 

 regulations promulgated thereunder shall be 

 rescinded and have no further effect.''.

 (c) Consolidation in <<NOTE: Deadline.>> Reformulated Gasoline 

Regulations.--Not later than 180 days after the date of enactment of 

this Act, the Administrator of the Environmental Protection Agency shall 

revise the reformulated gasoline regulations under subpart D of part 80 

of title 40, Code of Federal Regulations, to consolidate the regulations 

applicable to VOC-Control Regions 1 and 2 under section 80.41 of that 

title by eliminating the less stringent requirements applicable to 

gasoline designated for VOC-Control Region 2 and instead applying the 

more stringent requirements applicable to gasoline designated for VOCControl Region 1.

 (d) Savings <<NOTE: 42 USC 7545 note.>> Clause.--

 (1) In general.--Nothing in this section or any amendment 

 made by this section affects or prejudices any legal claim or 

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 action with respect to regulations promulgated by the 

 Administrator before the date of enactment of this Act 

 regarding--

 (A) emissions of toxic air pollutants from motor 

 vehicles; or

 (B) the adjustment of standards applicable to a 

 specific refinery or importer made under those 

 regulations.

 (2) Adjustment of standards.--

 (A) Applicability.--The Administrator may apply any 

 adjustments to the standards applicable to a refinery or 

 importer under subparagraph (B)(iii)(I) of section 

 211(k)(1) of the Clean Air Act (as added by subsection 

 (b)(2)), except that--

 (i) the Administrator shall revise the 

 adjustments to be based only on calendar years 

 1999 and 2000;

 (ii) any such adjustment shall not be made at 

 a level below the average percentage of reductions 

 of emissions of toxic air pollutants for 

 reformulated gasoline supplied to PADD I during 

 calendar years 1999 and 2000; and

 (iii) in the case of an adjustment based on 

 toxic air pollutant emissions from reformulated 

 gasoline significantly below the national annual 

 average emissions of toxic air pollutants from all 

 reformulated gasoline--

 (I) the Administrator may revise the 

 adjustment to take account of the scope 

 of the prohibition on methyl tertiary 

 butyl ether imposed by a State; and

[[Page 119 STAT. 1080]]

 (II) any such adjustment shall 

 require the refiner or importer, to the 

 maximum extent practicable, to maintain 

 the reduction achieved during calendar 

 years 1999 and 2000 in the average 

 annual aggregate emissions of toxic air 

 pollutants from reformulated gasoline 

 produced or distributed by the refiner 

 or importer.

SEC. 1505. PUBLIC HEALTH AND ENVIRONMENTAL IMPACTS OF FUELS AND FUEL 

 ADDITIVES.

 Section 211(b) of the Clean Air Act (42 U.S.C. 7545(b)) is amended--

 (1) in paragraph (2)--

 (A) by striking ``may also'' and inserting ``shall, 

 on a regular basis,''; and

 (B) by striking subparagraph (A) and inserting the 

 following:

 ``(A) to conduct tests to determine potential public 

 health and environmental effects of the fuel or additive 

 (including carcinogenic, teratogenic, or mutagenic 

 effects); and''; and

 (2) by adding at the end the following:

 ``(4) Study on certain fuel additives and blendstocks.--

 ``(A) In general.--Not <<NOTE: Deadline.>> later 

 than 2 years after the date of enactment of this 

 paragraph, the Administrator shall--

 ``(i) conduct a study on the effects on public 

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 health (including the effects on children, 

 pregnant women, minority or low-income 

 communities, and other sensitive populations), air 

 quality, and water resources of increased use of, 

 and the feasibility of using as substitutes for 

 methyl tertiary butyl ether in gasoline--

 ``(I) ethyl tertiary butyl ether;

 ``(II) tertiary amyl methyl ether;

 ``(III) di-isopropyl ether;

 ``(IV) tertiary butyl alcohol;

 ``(V) other ethers and heavy 

 alcohols, as determined by then 

 Administrator;

 ``(VI) ethanol;

 ``(VII) iso-octane; and

 ``(VIII) alkylates; and

 ``(ii) conduct a study on the effects on 

 public health (including the effects on children, 

 pregnant women, minority or low-income 

 communities, and other sensitive populations), air 

 quality, and water resources of the adjustment for 

 ethanol-blended reformulated gasoline to the 

 volatile organic compounds performance 

 requirements that are applicable under paragraphs 

 (1) and (3) of section 211(k); and

 ``(iii) <<NOTE: Reports.>> submit to the 

 Committee on Environment and Public Works of the 

 Senate and the Committee on Energy and Commerce of 

 the House of Representatives a report describing 

 the results of the studies under clauses (i) and 

 (ii).

[[Page 119 STAT. 1081]]

 ``(B) Contracts for study.--In carrying out this 

 paragraph, the Administrator may enter into one or more 

 contracts with nongovernmental entities such as--

 ``(i) the national energy laboratories; and

 ``(ii) institutions of higher education (as 

 defined in section 101 of the Higher Education Act 

 of 1965 (20 U.S.C. 1001)).''.

SEC. 1506. <<NOTE: Deadlines.>> ANALYSES OF MOTOR VEHICLE FUEL CHANGES.

 Section 211 of the Clean Air Act (42 U.S.C. 7545) is amended by 

inserting after subsection (p) the following:

 ``(q) Analyses of <<NOTE: Publication.>> Motor Vehicle Fuel Changes 

and Emissions Model.--

 ``(1) Anti-backsliding analysis.--

 ``(A) Draft analysis.--Not <<NOTE: Public 

 information.>> later than 4 years after the date of 

 enactment of this paragraph, the Administrator shall 

 publish for public comment a draft analysis of the 

 changes in emissions of air pollutants and air quality 

 due to the use of motor vehicle fuel and fuel additives 

 resulting from implementation of the amendments made by 

 the Energy Policy Act of 2005.

 ``(B) Final analysis.--After providing a reasonable 

 opportunity for comment but not later than 5 years after 

 the date of enactment of this paragraph, the 

 Administrator shall publish the analysis in final form.

 ``(2) Emissions model.--For the purposes of this section, 

 not later than 4 years after the date of enactment of this 

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 paragraph, the Administrator shall develop and finalize an 

 emissions model that reflects, to the maximum extent 

 practicable, the effects of gasoline characteristics or 

 components on emissions from vehicles in the motor vehicle fleet 

 during calendar year 2007.

 ``(3) Permeation effects study.--

 ``(A) In general.--Not later than 1 year after the 

 date of enactment of this paragraph, the Administrator 

 shall conduct a study, and report to Congress the 

 results of the study, on the effects of ethanol content 

 in gasoline on permeation, the process by which fuel 

 molecules migrate through the elastomeric materials 

 (rubber and plastic parts) that make up the fuel and 

 fuel vapor systems of a motor vehicle.

 ``(B) Evaporative emissions.--The study shall 

 include estimates of the increase in total evaporative 

 emissions likely to result from the use of gasoline with 

 ethanol content in a motor vehicle, and the fleet of 

 motor vehicles, due to permeation.''.

SEC. 1507. ADDITIONAL OPT-IN AREAS UNDER REFORMULATED GASOLINE PROGRAM.

 Section 211(k)(6) of the Clean Air Act (42 U.S.C. 7545(k)(6)) is 

amended--

 (1) by striking ``(6) Opt-in areas.--(A) Upon'' and 

 inserting the following:

 ``(6) Opt-in areas.--

 ``(A) Classified areas.--

 ``(i) In general.--Upon'';

 (2) in subparagraph (B), by striking ``(B) If'' and 

 inserting the following:

[[Page 119 STAT. 1082]]

 ``(ii) Effect of insufficient domestic 

 capacity to produce reformulated gasoline.--If'';

 (3) in subparagraph (A)(ii) (as redesignated by paragraph 

 (2))--

 (A) in the first sentence, by striking 

 ``subparagraph (A)'' and inserting ``clause (i)''; and

 (B) in the second sentence, by striking ``this 

 paragraph'' and inserting ``this subparagraph''; and

 (4) by adding at the end the following:

 ``(B) Ozone <<NOTE: Deadlines.>> transport region.--

 ``(i) Application of prohibition.--

 ``(I) In general.--On application of 

 the Governor of a State in the ozone 

 transport region established by section 

 184(a), the Administrator, not later 

 than 180 days after the date of receipt 

 of the application, shall apply the 

 prohibition specified in paragraph (5) 

 to any area in the State (other than an 

 area classified as a marginal, moderate, 

 serious, or severe ozone nonattainment 

 area under subpart 2 of part D of title 

 I) unless the Administrator determines 

 under clause (iii) that there is 

 insufficient capacity to supply 

 reformulated gasoline.

 ``(II) Publication 

 of <<NOTE: Federal 

 Register, publication.>> application.--

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 As soon as practicable after the date of 

 receipt of an application under 

 subclause (I), the Administrator shall 

 publish the application in the Federal 

 Register.

 ``(ii) Period of applicability.--Under clause 

 (i), the prohibition specified in paragraph (5) 

 shall apply in a State--

 ``(I) commencing as soon as 

 practicable but not later than 2 years 

 after the date of approval by the 

 Administrator of the application of the 

 Governor of the State; and

 ``(II) ending not earlier than 4 

 years after the commencement date 

 determined under subclause (I).

 ``(iii) Extension of commencement date based 

 on insufficient capacity.--

 ``(I) In general.--If, after receipt 

 of an application from a Governor of a 

 State under clause (i), the 

 Administrator determines, on the 

 Administrator's own motion or on 

 petition of any person, after 

 consultation with the Secretary of 

 Energy, that there is insufficient 

 capacity to supply reformulated 

 gasoline, the Administrator, by 

 regulation--

 ``(aa) shall extend the 

 commencement date with respect 

 to the State under clause 

 (ii)(I) for not more than 1 

 year; and

 ``(bb) may renew the 

 extension under item (aa) for 2 

 additional periods, each of 

 which shall not exceed 1 year.

[[Page 119 STAT. 1083]]

 ``(II) Deadline for action on 

 petitions.--The Administrator shall act 

 on any petition submitted under 

 subclause (I) not later than 180 days 

 after the date of receipt of the 

 petition.''.

SEC. 1508. DATA COLLECTION.

 Section 205 of the Department of Energy Organization Act (42 U.S.C. 

7135) is amended by adding at the end the following:

 ``(m) Renewable Fuels Survey.--(1) <<NOTE: Publication.>> In order 

to improve the ability to evaluate the effectiveness of the Nation's 

renewable fuels mandate, the Administrator shall conduct and publish the 

results of a survey of renewable fuels demand in the motor vehicle fuels 

market in the United States monthly, and in a manner designed to protect 

the confidentiality of individual responses. In conducting the survey, 

the Administrator shall collect information both on a national and 

regional basis, including each of the following:

 ``(A) The quantity of renewable fuels produced.

 ``(B) The quantity of renewable fuels blended.

 ``(C) The quantity of renewable fuels imported.

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 ``(D) The quantity of renewable fuels demanded.

 ``(E) Market price data.

 ``(F) Such other analyses or evaluations as the 

 Administrator finds are necessary to achieve the purposes of 

 this section.

 ``(2) The Administrator shall also collect or estimate information 

both on a national and regional basis, pursuant to subparagraphs (A) 

through (F) of paragraph (1), for the 5 years prior to implementation of 

this subsection.

 ``(3) This subsection does not affect the authority of the 

Administrator to collect data under section 52 of the Federal Energy 

Administration Act of 1974 (15 U.S.C. 790a).''.

SEC. 1509. FUEL SYSTEM REQUIREMENTS HARMONIZATION STUDY.

 (a) Study.--

 (1) In general.--The Administrator of the Environmental 

 Protection Agency and the Secretary shall jointly conduct a 

 study of Federal, State, and local requirements concerning motor 

 vehicle fuels, including--

 (A) requirements relating to reformulated gasoline, 

 volatility (measured in Reid vapor pressure), oxygenated 

 fuel, and diesel fuel; and

 (B) other requirements that vary from State to 

 State, region to region, or locality to locality.

 (2) Required elements.--The study shall assess--

 (A) the effect of the variety of requirements 

 described in paragraph (1) on the supply, quality, and 

 price of motor vehicle fuels available to the consumer;

 (B) the effect of the requirements described in 

 paragraph (1) on achievement of--

 (i) national, regional, and local air quality 

 standards and goals; and

 (ii) related environmental and public health 

 protection standards and goals (including the 

 protection of children, pregnant women, minority 

 or low-income communities, and other sensitive 

 populations);

 (C) the effect of Federal, State, and local motor 

 vehicle fuel regulations, including multiple motor 

 vehicle fuel requirements, on--

[[Page 119 STAT. 1084]]

 (i) domestic refiners;

 (ii) the fuel distribution system; and

 (iii) industry investment in new capacity;

 (D) the effect of the requirements described in 

 paragraph (1) on emissions from vehicles, refiners, and 

 fuel handling facilities;

 (E) the feasibility of developing national or 

 regional motor vehicle fuel slates for the 48 contiguous 

 States that, while protecting and improving air quality 

 at the national, regional, and local levels, could--

 (i) enhance flexibility in the fuel 

 distribution infrastructure and improve fuel 

 fungibility;

 (ii) reduce price volatility and costs to 

 consumers and producers;

 (iii) provide increased liquidity to the 

 gasoline market; and

 (iv) enhance fuel quality, consistency, and 

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 supply;

 (F) the feasibility of providing incentives, and the 

 need for the development of national standards 

 necessary, to promote cleaner burning motor vehicle 

 fuel; and

 (G) the extent to which improvements in air quality 

 and any increases or decreases in the price of motor 

 fuel can be projected to result from the Environmental 

 Protection Agency's Tier II requirements for 

 conventional gasoline and vehicle emission systems, on-

 road and off-road diesel rules, the reformulated 

 gasoline program, the renewable content requirements 

 established by this subtitle, State programs regarding 

 gasoline volatility, and any other requirements imposed 

 by the Federal Government, States or localities 

 affecting the composition of motor fuel.

 (b) Report.--

 (1) In general.--Not later than June 1, 2008, the 

 Administrator of the Environmental Protection Agency and the 

 Secretary shall submit to Congress a report on the results of 

 the study conducted under subsection (a).

 (2) Recommendations.--

 (A) In general.--The report shall contain 

 recommendations for legislative and administrative 

 actions that may be taken--

 (i) to improve air quality;

 (ii) to reduce costs to consumers and 

 producers; and

 (iii) to increase supply liquidity.

 (B) Required considerations.--The recommendations 

 under subparagraph (A) shall take into account the need 

 to provide advance notice of required modifications to 

 refinery and fuel distribution systems in order to 

 ensure an adequate supply of motor vehicle fuel in all 

 States.

 (3) Consultation.--In developing the report, the 

 Administrator of the Environmental Protection Agency and the 

 Secretary shall consult with--

 (A) the Governors of the States;

 (B) automobile manufacturers;

 (C) State and local air pollution control 

 regulators;

 (D) public health experts;

 (E) motor vehicle fuel producers and distributors; 

 and

 (F) the public.

[[Page 119 STAT. 1085]]

SEC. 1510. <<NOTE: 42 USC 16501.>> COMMERCIAL BYPRODUCTS FROM MUNICIPAL 

 SOLID WASTE AND CELLULOSIC BIOMASS LOAN GUARANTEE PROGRAM.

 (a) Definition of Municipal Solid Waste.--In this section, the term 

``municipal solid waste'' has the meaning given the term ``solid waste'' 

in section 1004 of the Solid Waste Disposal Act (42 U.S.C. 6903).

 (b) Establishment of Program.--The Secretary shall establish a 

program to provide guarantees of loans by private institutions for the 

construction of facilities for the processing and conversion of 

municipal solid waste and cellulosic biomass into fuel ethanol and other 

commercial byproducts.

 (c) Requirements.--The Secretary may provide a loan guarantee under 

subsection (b) to an applicant if--

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 (1) without a loan guarantee, credit is not available to the 

 applicant under reasonable terms or conditions sufficient to 

 finance the construction of a facility described in subsection 

 (b);

 (2) the prospective earning power of the applicant and the 

 character and value of the security pledged provide a reasonable 

 assurance of repayment of the loan to be guaranteed in 

 accordance with the terms of the loan; and

 (3) the loan bears interest at a rate determined by the 

 Secretary to be reasonable, taking into account the current 

 average yield on outstanding obligations of the United States 

 with remaining periods of maturity comparable to the maturity of 

 the loan.

 (d) Criteria.--In selecting recipients of loan guarantees from among 

applicants, the Secretary shall give preference to proposals that--

 (1) meet all applicable Federal and State permitting 

 requirements;

 (2) are most likely to be successful; and

 (3) are located in local markets that have the greatest need 

 for the facility because of--

 (A) the limited availability of land for waste 

 disposal;

 (B) the availability of sufficient quantities of 

 cellulosic biomass; or

 (C) a high level of demand for fuel ethanol or other 

 commercial byproducts of the facility.

 (e) Maturity.--A loan guaranteed under subsection (b) shall have a 

maturity of not more than 20 years.

 (f) Terms and Conditions.--The loan agreement for a loan guaranteed 

under subsection (b) shall provide that no provision of the loan 

agreement may be amended or waived without the consent of the Secretary.

 (g) Assurance of Repayment.--The Secretary shall require that an 

applicant for a loan guarantee under subsection (b) provide an assurance 

of repayment in the form of a performance bond, insurance, collateral, 

or other means acceptable to the Secretary in an amount equal to not 

less than 20 percent of the amount of the loan.

 (h) Guarantee Fee.--The recipient of a loan guarantee under 

subsection (b) shall pay the Secretary an amount determined by the 

Secretary to be sufficient to cover the administrative costs of the 

Secretary relating to the loan guarantee.

[[Page 119 STAT. 1086]]

 (i) Full Faith and Credit.--The full faith and credit of the United 

States is pledged to the payment of all guarantees made under this 

section. Any such guarantee made by the Secretary shall be conclusive 

evidence of the eligibility of the loan for the guarantee with respect 

to principal and interest. The validity of the guarantee shall be 

incontestable in the hands of a holder of the guaranteed loan.

 (j) Reports.--Until each guaranteed loan under this section has been 

repaid in full, the Secretary shall annually submit to Congress a report 

on the activities of the Secretary under this section.

 (k) Authorization of Appropriations.--There are authorized to be 

appropriated such sums as are necessary to carry out this section.

 (l) Termination of Authority.--The authority of the Secretary to 

issue a loan guarantee under subsection (b) terminates on the date that 

is 10 years after the date of enactment of this Act.

SEC. 1511. RENEWABLE FUEL.

 The Clean Air Act is amended by inserting after section 211 (42 

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U.S.C. 7411) the following:

``SEC. 212. <<NOTE: 42 USC 7546.>> RENEWABLE FUEL.

 ``(a) Definitions.--In this section:

 ``(1) Municipal solid waste.--The term `municipal solid 

 waste' has the meaning given the term `solid waste' in section 

 1004 of the Solid Waste Disposal Act (42 U.S.C. 6903).

 ``(2) RFG state.--The term `RFG State' means a State in 

 which is located one or more covered areas (as defined in 

 section 211(k)(10)(D)).

 ``(3) Secretary.--The term `Secretary' means the Secretary 

 of Energy.

 ``(b) Cellulosic Biomass Ethanol and Municipal Solid Waste Loan 

Guarantee Program.--

 ``(1) In general.--Funds may be provided for the cost (as 

 defined in the Federal Credit Reform Act of 1990 (2 U.S.C. 661 

 et seq.)) of loan guarantees issued under title XIV of the 

 Energy Policy Act to carry out commercial demonstration projects 

 for celluosic biomass and sucrose-derived ethanol.

 ``(2) Demonstration projects.--

 ``(A) In general.--The Secretary shall issue loan 

 guarantees under this section to carry out not more than 

 4 projects to commercially demonstrate the feasibility 

 and viability of producing cellulosic biomass ethanol or 

 sucrose-derived ethanol, including at least 1 project 

 that uses cereal straw as a feedstock and 1 project that 

 uses municipal solid waste as a feedstock.

 ``(B) Design capacity.--Each project shall have a 

 design capacity to produce at least 30,000,000 gallons 

 of cellulosic biomass ethanol each year.

 ``(3) Applicant assurances.--An applicant for a loan 

 guarantee under this section shall provide assurances, 

 satisfactory to the Secretary, that--

 ``(A) the project design has been validated through 

 the operation of a continuous process facility with a 

 cumulative output of at least 50,000 gallons of ethanol;

 ``(B) the project has been subject to a full 

 technical review;

[[Page 119 STAT. 1087]]

 ``(C) the project is covered by adequate project 

 performance guarantees;

 ``(D) the project, with the loan guarantee, is 

 economically viable; and

 ``(E) there is a reasonable assurance of repayment 

 of the guaranteed loan.

 ``(4) Limitations.--

 ``(A) Maximum guarantee.--Except as provided in 

 subparagraph (B), a loan guarantee under this section 

 may be issued for up to 80 percent of the estimated cost 

 of a project, but may not exceed $250,000,000 for a 

 project.

 ``(B) Additional guarantees.--

 ``(i) In general.--The Secretary may issue 

 additional loan guarantees for a project to cover 

 up to 80 percent of the excess of actual project 

 cost over estimated project cost but not to exceed 

 15 percent of the amount of the original 

 guarantee.

 ``(ii) Principal and interest.--Subject to 

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 subparagraph (A), the Secretary shall guarantee 

 100 percent of the principal and interest of a 

 loan made under subparagraph (A).

 ``(5) Equity contributions.--To be eligible for a loan 

 guarantee under this section, an applicant for the loan 

 guarantee shall have binding commitments from equity investors 

 to provide an initial equity contribution of at least 20 percent 

 of the total project cost.

 ``(6) Insufficient amounts.--If the amount made available to 

 carry out this section is insufficient to allow the Secretary to 

 make loan guarantees for 3 projects described in subsection (b), 

 the Secretary shall issue loan guarantees for one or more 

 qualifying projects under this section in the order in which the 

 applications for the projects are received by the Secretary.

 ``(7) Approval.--An <<NOTE: Deadline.>> application for a 

 loan guarantee under this section shall be approved or 

 disapproved by the Secretary not later than 90 days after the 

 application is received by the Secretary.

 ``(c) Authorization 

of <<NOTE: Mississippi. Oklahoma.>> Appropriations for Resource 

Center.--There is authorized to be appropriated, for a resource center 

to further develop bioconversion technology using low-cost biomass for 

the production of ethanol at the Center for Biomass-Based Energy at the 

Mississippi State University and the Oklahoma State University, 

$4,000,000 for each of fiscal years 2005 through 2007.

 ``(d) Renewable Fuel Production Research and Development Grants.--

 ``(1) In general.--The Administrator shall provide grants 

 for the research into, and development and implementation of, 

 renewable fuel production technologies in RFG States with low 

 rates of ethanol production, including low rates of production 

 of cellulosic biomass ethanol.

 ``(2) Eligibility.--

 ``(A) In general.--The entities eligible to receive 

 a grant under this subsection are academic institutions 

 in RFG States, and consortia made up of combinations of 

 academic institutions, industry, State government 

 agencies, or local government agencies in RFG States, 

 that have

[[Page 119 STAT. 1088]]

 proven experience and capabilities with relevant 

 technologies.

 ``(B) Application.--To be eligible to receive a 

 grant under this subsection, an eligible entity shall 

 submit to the Administrator an application in such 

 manner and form, and accompanied by such information, as 

 the Administrator may specify.

 ``(3) Authorization of appropriations.--There is authorized 

 to be appropriated to carry out this subsection $25,000,000 for 

 each of fiscal years 2006 through 2010.

 ``(e) Cellulosic Biomass Ethanol Conversion Assistance.--

 ``(1) In general.--The Secretary may provide grants to 

 merchant producers of cellulosic biomass ethanol in the United 

 States to assist the producers in building eligible production 

 facilities described in paragraph (2) for the production of 

 cellulosic biomass ethanol.

 ``(2) Eligible production facilities.--A production facility 

 shall be eligible to receive a grant under this subsection if 

 the production facility--

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 ``(A) is located in the United States; and

 ``(B) uses cellulosic biomass feedstocks derived 

 from agricultural residues or municipal solid waste.

 ``(3) Authorization of appropriations.--There is authorized 

 to be appropriated to carry out this subsection--

 ``(A) $250,000,000 for fiscal year 2006; and

 ``(B) $400,000,000 for fiscal year 2007.''.

SEC. 1512. CONVERSION ASSISTANCE FOR CELLULOSIC BIOMASS, WASTE-DERIVED 

 ETHANOL, APPROVED RENEWABLE FUELS.

 Section 211 of the Clean Air Act (42 U.S.C. 7545) is amended by 

adding at the end the following:

 ``(r) Conversion Assistance for Cellulosic Biomass, Waste-Derived 

Ethanol, Approved Renewable Fuels.--

 ``(1) In general.--The Secretary of Energy may provide 

 grants to merchant producers of cellulosic biomass ethanol, 

 waste-derived ethanol, and approved renewable fuels in the 

 United States to assist the producers in building eligible 

 production facilities described in paragraph (2) for the 

 production of ethanol or approved renewable fuels.

 ``(2) Eligible production facilities.--A production facility 

 shall be eligible to receive a grant under this subsection if 

 the production facility--

 ``(A) is located in the United States; and

 ``(B) uses cellulosic or renewable biomass or waste-

 derived feedstocks derived from agricultural residues, 

 wood residues, municipal solid waste, or agricultural 

 byproducts.

 ``(3) Authorization of appropriations.--There are authorized 

 to be appropriated the following amounts to carry out this 

 subsection:

 ``(A) $100,000,000 for fiscal year 2006.

 ``(B) $250,000,000 for fiscal year 2007.

 ``(C) $400,000,000 for fiscal year 2008.

 ``(4) Definitions.--For the purposes of this subsection:

 ``(A) The term `approved renewable fuels' are fuels 

 and components of fuels that have been approved by the 

 Department of Energy, as defined in section 301 of the 

 Energy

[[Page 119 STAT. 1089]]

 Policy Act of 1992 (42 U.S.C. 13211), which have been 

 made from renewable biomass.

 ``(B) The term `renewable biomass' is, as defined in 

 Presidential Executive Order 13134, published in the 

 Federal Register on August 16, 1999, any organic matter 

 that is available on a renewable or recurring basis 

 (excluding old-growth timber), including dedicated 

 energy crops and trees, agricultural food and feed crop 

 residues, aquatic plants, animal wastes, wood and wood 

 residues, paper and paper residues, and other vegetative 

 waste materials. Old-growth timber means timber of a 

 forest from the late successional stage of forest 

 development.''.

SEC. 1513. BLENDING OF COMPLIANT REFORMULATED GASOLINES.

 Section 211 of the Clean Air Act (42 U.S.C. 7545) is amended by 

adding at the end the following:

 ``(s) Blending of Compliant Reformulated Gasolines.--

 ``(1) In general.--Notwithstanding subsections (h) and (k) 

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 and subject to the limitations in paragraph (2) of this 

 subsection, it shall not be a violation of this subtitle for a 

 gasoline retailer, during any month of the year, to blend at a 

 retail location batches of ethanol-blended and non-ethanol-

 blended reformulated gasoline, provided that--

 ``(A) each batch of gasoline to be blended has been 

 individually certified as in compliance with subsections 

 (h) and (k) prior to being blended;

 ``(B) the retailer notifies the Administrator prior 

 to such blending, and identifies the exact location of 

 the retail station and the specific tank in which such 

 blending will take place;

 ``(C) the retailer retains and, as requested by the 

 Administrator or the Administrator's designee, makes 

 available for inspection such certifications accounting 

 for all gasoline at the retail outlet; and

 ``(D) the retailer does not, between June 1 and 

 September 15 of each year, blend a batch of VOC-

 controlled, or `summer', gasoline with a batch of non-

 VOC-controlled, or `winter', gasoline (as these terms 

 are defined under subsections (h) and (k)).

 ``(2) Limitations.--

 ``(A) Frequency limitation.--A retailer shall only 

 be permitted to blend batches of compliant reformulated 

 gasoline under this subsection a maximum of two blending 

 periods between May 1 and September 15 of each calendar 

 year.

 ``(B) Duration of blending period.--Each blending 

 period authorized under subparagraph (A) shall extend 

 for a period of no more than 10 consecutive calendar 

 days.

 ``(3) Surveys.--A sample of gasoline taken from a retail 

 location that has blended gasoline within the past 30 days and 

 is in compliance with subparagraphs (A), (B), (C), and (D) of 

 paragraph (1) shall not be used in a VOC survey mandated by 40 

 CFR Part 80.

 ``(4) State implementation plans.--A State shall be held 

 harmless and shall not be required to revise its State 

 implementation plan under section 110 to account for the 

 emissions from blended gasoline authorized under paragraph (1).

[[Page 119 STAT. 1090]]

 ``(5) Preservation of state law.--Nothing in this subsection 

 shall--

 ``(A) preempt existing State laws or regulations 

 regulating the blending of compliant gasolines; or

 ``(B) prohibit a State from adopting such 

 restrictions in the future.

 ``(6) Regulations.--

 The <<NOTE: Notice. Deadline.>> Administrator shall promulgate, 

 after notice and comment, regulations implementing this 

 subsection within 1 year after the date of enactment of this 

 subsection.

 ``(7) Effective date.--This subsection shall become 

 effective 15 months after the date of its enactment and shall 

 apply to blended batches of reformulated gasoline on or after 

 that date, regardless of whether the implementing regulations 

 required by paragraph (6) have been promulgated by the 

 Administrator by that date.

 ``(8) Liability.--No person other than the person 

 responsible for blending under this subsection shall be subject 

 to an enforcement action or penalties under subsection (d) 

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 solely arising from the blending of compliant reformulated 

 gasolines by the retailers.

 ``(9) Formulation of gasoline.--This subsection does not 

 grant authority to the Administrator or any State (or any 

 subdivision thereof) to require reformulation of gasoline at the 

 refinery to adjust for potential or actual emissions increases 

 due to the blending authorized by this subsection.''.

SEC. 1514. <<NOTE: 42 USC 16502.>> ADVANCED BIOFUEL TECHNOLOGIES 

 PROGRAM.

 (a) In General.--Subject to the availability of appropriations under 

subsection (d), the Administrator of the Environmental Protection Agency 

shall, in consultation with the Secretary of Agriculture and the Biomass 

Research and Development Technical Advisory Committee established under 

section 306 of the Biomass Research and Development Act of 2000 (Public 

Law 106-224; 7 U.S.C. 8101 note), establish a program, to be known as 

the ``Advanced Biofuel Technologies Program'', to demonstrate advanced 

technologies for the production of alternative transportation fuels.

 (b) Priority.--In carrying out the program under subsection (a), the 

Administrator shall give priority to projects that enhance the 

geographical diversity of alternative fuels production and utilize 

feedstocks that represent 10 percent or less of ethanol or biodiesel 

fuel production in the United States during the previous fiscal year.

 (c) Demonstration Projects.--

 (1) In general.--As part of the program under subsection 

 (a), the Administrator shall fund demonstration projects--

 (A) to develop not less than 4 different conversion 

 technologies for producing cellulosic biomass ethanol; 

 and

 (B) to develop not less than 5 technologies for 

 coproducing value-added bioproducts (such as 

 fertilizers, herbicides, and pesticides) resulting from 

 the production of biodiesel fuel.

 (2) Administration.--Demonstration projects under this 

 subsection shall be--

 (A) conducted based on a merit-reviewed, competitive 

 process; and

[[Page 119 STAT. 1091]]

 (B) subject to the cost-sharing requirements of 

 section 988.

 (d) Authorization of Appropriations.--There are authorized to be 

appropriated to carry out this section $110,000,000 for each of fiscal 

years 2005 through 2009.

SEC. 1515. WASTE-DERIVED ETHANOL AND BIODIESEL.

 Section 312(f)(1) of the Energy Policy Act of 1992 (42 U.S.C. 

13220(f)(1)) is amended--

 (1) by striking `` `biodiesel' means'' and inserting the 

 following: `` `biodiesel'--

 ``(A) means''; and

 (2) in subparagraph (A) (as designated by paragraph (1)) by 

 striking ``and'' at the end and inserting the following:

 ``(B) includes biodiesel derived from--

 ``(i) animal wastes, including poultry fats 

 and poultry wastes, and other waste materials; or

 ``(ii) municipal solid waste and sludges and 

 oils derived from wastewater and the treatment of 

 wastewater; and''.

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SEC. 1516. <<NOTE: 42 USC 16503.>> SUGAR ETHANOL LOAN GUARANTEE PROGRAM.

 (a) In General.--Funds may be provided for the cost (as defined in 

section 502 of the Federal Credit Reform Act of 1990 (2 U.S.C. 661a)) of 

loan guarantees issued under title XIV to carry out commercial 

demonstration projects for ethanol derived from sugarcane, bagasse, and 

other sugarcane byproducts.

 (b) Demonstration Projects.--The Secretary may issue loan guarantees 

under this section to projects to demonstrate commercially the 

feasibility and viability of producing ethanol using sugarcane, 

sugarcane bagasse, and other sugarcane byproducts as a feedstock.

 (c) Requirements.--An applicant for a loan guarantee under this 

section may provide assurances, satisfactory to the Secretary, that--

 (1) the project design has been validated through the 

 operation of a continuous process facility;

 (2) the project has been subject to a full technical review;

 (3) the project, with the loan guarantee, is economically 

 viable; and

 (4) there is a reasonable assurance of repayment of the 

 guaranteed loan.

 (d) Limitations.--

 (1) Maximum guarantee.--Except as provided in paragraph (2), 

 a loan guarantee under this section--

 (A) may be issued for up to 80 percent of the 

 estimated cost of a project; but

 (B) shall not exceed $50,000,000 for any 1 project.

 (2) Additional guarantees.--

 (A) In general.--The Secretary may issue additional 

 loan guarantees for a project to cover--

 (i) up to 80 percent of the excess of actual 

 project costs; but

 (ii) not to exceed 15 percent of the amount of 

 the original loan guarantee.

[[Page 119 STAT. 1092]]

 (B) Principal and interest.--Subject to subparagraph 

 (A), the Secretary shall guarantee 100 percent of the 

 principal and interest of a loan guarantee made under 

 subparagraph (A).

 Subtitle B--Underground <<NOTE: Underground Storage Tank Compliance 

Act.>> Storage Tank Compliance

SEC. 1521. <<NOTE: 42 USC 6901 note.>> SHORT TITLE.

 This subtitle may be cited as the ``Underground Storage Tank 

Compliance Act''.

SEC. 1522. LEAKING UNDERGROUND STORAGE TANKS.

 (a) In General.--Section 9004 of the Solid Waste Disposal Act (42 

U.S.C. 6991c) is amended by adding at the end the following:

 ``(f) Trust Fund Distribution.--

 ``(1) In general.--

 ``(A) Amount and permitted uses of distribution.--

 The Administrator shall distribute to States not less 

 than 80 percent of the funds from the Trust Fund that 

 are made available to the Administrator under section 

 9014(2)(A) for each fiscal year for use in paying the 

 reasonable costs, incurred under a cooperative agreement 

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 with any State for--

 ``(i) corrective actions taken by the State 

 under section 9003(h)(7)(A);

 ``(ii) necessary administrative expenses, as 

 determined by the Administrator, that are directly 

 related to State fund or State assurance programs 

 under subsection (c)(1); or

 ``(iii) enforcement, by a State or a local 

 government, of State or local regulations 

 pertaining to underground storage tanks regulated 

 under this subtitle.

 ``(B) Use of funds for enforcement.--In addition to 

 the uses of funds authorized under subparagraph (A), the 

 Administrator may use funds from the Trust Fund that are 

 not distributed to States under subparagraph (A) for 

 enforcement of any regulation promulgated by the 

 Administrator under this subtitle.

 ``(C) Prohibited uses.--Funds provided to a State by 

 the Administrator under subparagraph (A) shall not be 

 used by the State to provide financial assistance to an 

 owner or operator to meet any requirement relating to 

 underground storage tanks under subparts B, C, D, H, and 

 G of part 280 of title 40, Code of Federal Regulations 

 (as in effect on the date of enactment of this 

 subsection).

 ``(2) Allocation.--

 ``(A) Process.--Subject to subparagraphs (B) and 

 (C), in the case of a State with which the Administrator 

 has entered into a cooperative agreement under section 

 9003(h)(7)(A), the Administrator shall distribute funds 

 from the Trust Fund to the State using an allocation 

 process developed by the Administrator.

 ``(B) Diversion of state funds.--The Administrator 

 shall not distribute funds under subparagraph (A)(iii) 

 of subsection (f)(1) to any State that has diverted 

 funds from

[[Page 119 STAT. 1093]]

 a State fund or State assurance program for purposes 

 other than those related to the regulation of 

 underground storage tanks covered by this subtitle, with 

 the exception of those transfers that had been completed 

 earlier than the date of enactment of this subsection.

 ``(C) Revisions to process.--The Administrator may 

 revise the allocation process referred to in 

 subparagraph (A) after--

 ``(i) consulting with State agencies 

 responsible for overseeing corrective action for 

 releases from underground storage tanks; and

 ``(ii) taking into consideration, at a 

 minimum, each of the following:

 ``(I) The number of confirmed 

 releases from federally regulated 

 leaking underground storage tanks in the 

 States.

 ``(II) The number of federally 

 regulated underground storage tanks in 

 the States.

 ``(III) The performance of the 

 States in implementing and enforcing the 

 program.

 ``(IV) The financial needs of the 

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 States.

 ``(V) The ability of the States to 

 use the funds referred to in 

 subparagraph (A) in any year.

 ``(3) Distributions to state agencies.--Distributions from 

 the Trust Fund under this subsection shall be made directly to a 

 State agency that--

 ``(A) enters into a cooperative agreement referred 

 to in paragraph (2)(A); or

 ``(B) is enforcing a State program approved under 

 this section.''.

 (b) Withdrawal of Approval of State Funds.--Section 9004(c) of the 

Solid Waste Disposal Act (42 U.S.C. 6991c(c)) is amended by inserting 

the following new paragraph at the end thereof:

 ``(6) Withdrawal of approval.--After an opportunity for good 

 faith, collaborative efforts to correct financial deficiencies 

 with a State fund, the Administrator may withdraw approval of 

 any State fund or State assurance program to be used as a 

 financial responsibility mechanism without withdrawing approval 

 of a State underground storage tank program under section 

 9004(a).''.

 (c) Ability to Pay.--Section 9003(h)(6) of the Solid Waste Disposal 

Act (42 U.S.C. 6591a(h)(6)) is <<NOTE: 42 USC 6991b.>> amended by adding 

the following new subparagraph at the end thereof:

 ``(E) Inability or limited ability to pay.--

 ``(i) In general.--In determining the level of 

 recovery effort, or amount that should be 

 recovered, the Administrator (or the State 

 pursuant to paragraph (7)) shall consider the 

 owner or operator's ability to pay. An inability 

 or limited ability to pay corrective action costs 

 must be demonstrated to the Administrator (or the 

 State pursuant to paragraph (7)) by the owner or 

 operator.

 ``(ii) Considerations.--In determining whether 

 or not a demonstration is made under clause (i), 

 the Administrator (or the State pursuant to 

 paragraph (7)) shall take into consideration the 

 ability of the

[[Page 119 STAT. 1094]]

 owner or operator to pay corrective action costs 

 and still maintain its basic business operations, 

 including consideration of the overall financial 

 condition of the owner or operator and 

 demonstrable constraints on the ability of the 

 owner or operator to raise revenues.

 ``(iii) Information.--An owner or operator 

 requesting consideration under this subparagraph 

 shall promptly provide the Administrator (or the 

 State pursuant to paragraph (7)) with all relevant 

 information needed to determine the ability of the 

 owner or operator to pay corrective action costs.

 ``(iv) Alternative payment methods.--The 

 Administrator (or the State pursuant to paragraph 

 (7)) shall consider alternative payment methods as 

 may be necessary or appropriate if the 

 Administrator (or the State pursuant to paragraph 

 (7)) determines that an owner or operator cannot 

 pay all or a portion of the costs in a lump sum 

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 payment.

 ``(v) Misrepresentation.--If an owner or 

 operator provides false information or otherwise 

 misrepresents their financial situation under 

 clause (ii), the Administrator (or the State 

 pursuant to paragraph (7)) shall seek full 

 recovery of the costs of all such actions pursuant 

 to the provisions of subparagraph (A) without 

 consideration of the factors in subparagraph 

 (B).''.

SEC. 1523. INSPECTION OF UNDERGROUND STORAGE TANKS.

 (a) Inspection Requirements.--Section 9005 of the Solid Waste 

Disposal Act (42 U.S.C. 6991d) is amended by inserting the following new 

subsection at the end thereof:

 ``(c) Inspection Requirements.--

 ``(1) Uninspected tanks.--In <<NOTE: Deadline.>> the case of 

 underground storage tanks regulated under this subtitle that 

 have not undergone an inspection since December 22, 1998, not 

 later than 2 years after the date of enactment of this 

 subsection, the Administrator or a State that receives funding 

 under this subtitle, as appropriate, shall conduct on-site 

 inspections of all such tanks to determine compliance with this 

 subtitle and the regulations under this subtitle (40 CFR 280) or 

 a requirement or standard of a State program developed under 

 section 9004.

 ``(2) Periodic inspections.--After completion of all 

 inspections required under paragraph (1), the Administrator or a 

 State that receives funding under this subtitle, as appropriate, 

 shall conduct on-site inspections of each underground storage 

 tank regulated under this subtitle at least once every 3 years 

 to determine compliance with this subtitle and the regulations 

 under this subtitle (40 CFR 280) or a requirement or standard of 

 a State program developed under section 9004. The Administrator 

 may extend for up to one additional year the first 3-year 

 inspection interval under this paragraph if the State 

 demonstrates that it has insufficient resources to complete all 

 such inspections within the first 3-year period.

 ``(3) Inspection authority.--Nothing in this section shall 

 be construed to diminish the Administrator's or a State's 

 authorities under section 9005(a).''.

[[Page 119 STAT. 1095]]

 (b) Study of <<NOTE: Reports. Deadline.>> Alternative Inspection 

Programs.--The Administrator of the Environmental Protection Agency, in 

coordination with a State, shall gather information on compliance 

assurance programs that could serve as an alternative to the inspection 

programs under section 9005(c) of the Solid Waste Disposal Act (42 

U.S.C. 6991d(c)) and shall, within 4 years after the date of enactment 

of this Act, submit a report to the Congress containing the results of 

such study.

SEC. 1524. OPERATOR TRAINING.

 (a) In General.--Section 9010 of the Solid Waste Disposal Act (42 

U.S.C. 6991i) is amended to read as follows:

``SEC. 9010. OPERATOR TRAINING.

 ``(a) <<NOTE: Deadline. Notification. Public 

information. Publication.>> Guidelines.--

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 ``(1) In general.--Not later than 2 years after the date of 

 enactment of the Underground Storage Tank Compliance Act, in 

 consultation and cooperation with States and after public notice 

 and opportunity for comment, the Administrator shall publish 

 guidelines that specify training requirements for--

 ``(A) persons having primary responsibility for on-

 site operation and maintenance of underground storage 

 tank systems;

 ``(B) persons having daily on-site responsibility 

 for the operation and maintenance of underground storage 

 tanks systems; and

 ``(C) daily, on-site employees having primary 

 responsibility for addressing emergencies presented by a 

 spill or release from an underground storage tank 

 system.

 ``(2) Considerations.--The guidelines described in paragraph 

 (1) shall take into account--

 ``(A) State training programs in existence as of the 

 date of publication of the guidelines;

 ``(B) training programs that are being employed by 

 tank owners and tank operators as of the date of 

 enactment of the Underground Storage Tank Compliance 

 Act;

 ``(C) the high turnover rate of tank operators and 

 other personnel;

 ``(D) the frequency of improvement in underground 

 storage tank equipment technology;

 ``(E) the nature of the businesses in which the tank 

 operators are engaged;

 ``(F) the substantial differences in the scope and 

 length of training needed for the different classes of 

 persons described in subparagraphs (A), (B), and (C) of 

 paragraph (1); and

 ``(G) such other factors as the Administrator 

 determines to be necessary to carry out this section.

 ``(b) State <<NOTE: Deadline.>> Programs.--

 ``(1) In general.--Not later than 2 years after the date on 

 which the Administrator publishes the guidelines under 

 subsection (a)(1), each State that receives funding under this 

 subtitle shall develop State-specific training requirements that 

 are consistent with the guidelines developed under subsection 

 (a)(1).

 ``(2) Requirements.--State requirements described in 

 paragraph (1) shall--

 ``(A) be consistent with subsection (a);

[[Page 119 STAT. 1096]]

 ``(B) be developed in cooperation with tank owners 

 and tank operators;

 ``(C) take into consideration training programs 

 implemented by tank owners and tank operators as of the 

 date of enactment of this section; and

 ``(D) be appropriately communicated to tank owners 

 and operators.

 ``(3) Financial incentive.--The Administrator may award to a 

 State that develops and implements requirements described in 

 paragraph (1), in addition to any funds that the State is 

 entitled to receive under this subtitle, not more than $200,000, 

 to be used to carry out the requirements.

 ``(c) Training.--All persons that are subject to the operator 

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training requirements of subsection (a) shall--

 ``(1) meet the training requirements developed under 

 subsection (b); and

 ``(2) repeat the applicable requirements developed under 

 subsection (b), if the tank for which they have primary daily 

 on-site management responsibilities is determined to be out of 

 compliance with--

 ``(A) a requirement or standard promulgated by the 

 Administrator under section 9003; or

 ``(B) a requirement or standard of a State program 

 approved under section 9004.''.

 (b) State Program Requirement.--Section 9004(a) of the Solid Waste 

Disposal Act (42 U.S.C. 6991c(a)) is amended by striking ``and'' at the 

end of paragraph (7), by striking the period at the end of paragraph (8) 

and inserting ``; and'', and by adding the following new paragraph at 

the end thereof:

 ``(9) State-specific training requirements as required by 

 section 9010.''.

 (c) Enforcement.--Section 9006(d)(2) of such Act (42 U.S.C. 6991e) 

is amended as follows:

 (1) By striking ``or'' at the end of subparagraph (B).

 (2) By adding the following new subparagraph after 

 subparagraph (C):

 ``(D) the training requirements established by States 

 pursuant to section 9010 (relating to operator training); or''.

 (d) Table of Contents.--The item relating to section 9010 in the 

table of contents for the Solid Waste Disposal Act is amended to read as 

follows:

``Sec. 9010. Operator training.''.

SEC. 1525. REMEDIATION FROM OXYGENATED FUEL ADDITIVES.

 Section 9003(h) of the Solid Waste Disposal Act (42 U.S.C. 6991b(h)) 

is amended as follows:

 (1) In paragraph (7)(A)--

 (A) by striking ``paragraphs (1) and (2) of this 

 subsection'' and inserting ``paragraphs (1), (2), and 

 (12)''; and

 (B) by striking ``and including the authorities of 

 paragraphs (4), (6), and (8) of this subsection'' and 

 inserting ``and the authority under sections 9011 and 

 9012 and paragraphs (4), (6), and (8),''.

 (2) By adding at the end the following:

 ``(12) Remediation of oxygenated fuel contamination.--

[[Page 119 STAT. 1097]]

 ``(A) In general.--The Administrator and the States 

 may use funds made available under section 9014(2)(B) to 

 carry out corrective actions with respect to a release 

 of a fuel containing an oxygenated fuel additive that 

 presents a threat to human health or welfare or the 

 environment.

 ``(B) Applicable authority.--

 The <<NOTE: Contracts.>> Administrator or a State shall 

 carry out subparagraph (A) in accordance with paragraph 

 (2), and in the case of a State, in accordance with a 

 cooperative agreement entered into by the Administrator 

 and the State under paragraph (7).''.

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SEC. 1526. RELEASE PREVENTION, COMPLIANCE, AND ENFORCEMENT.

 (a) Release Prevention and Compliance.--Subtitle I of the Solid 

Waste Disposal Act (42 U.S.C. 6991 et seq.) is amended by adding at the 

end the following:

``SEC. 9011. <<NOTE: 42 USC 6991j.>> USE OF FUNDS FOR RELEASE PREVENTION 

 AND COMPLIANCE.

 ``Funds made available under section 9014(2)(D) from the Trust Fund 

may be used to conduct inspections, issue orders, or bring actions under 

this subtitle--

 ``(1) by a State, in accordance with a grant or cooperative 

 agreement with the Administrator, of State regulations 

 pertaining to underground storage tanks regulated under this 

 subtitle; and

 ``(2) by the Administrator, for tanks regulated under this 

 subtitle (including under a State program approved under section 

 9004).''.

 (b) Government-Owned Tanks.--Section 9003 of the Solid Waste 

Disposal Act (42 U.S.C. 6991b) is amended by adding at the end the 

following:

 ``(i) Government-Owned Tanks.--

 ``(1) State compliance report.--(A) <<NOTE: Deadline.>> Not 

 later than 2 years after the date of enactment of this 

 subsection, each State that receives funding under this subtitle 

 shall submit to the Administrator a State compliance report 

 that--

 ``(i) lists the location and owner of each 

 underground storage tank described in subparagraph (B) 

 in the State that, as of the date of submission of the 

 report, is not in compliance with section 9003; and

 ``(ii) specifies the date of the last inspection and 

 describes the actions that have been and will be taken 

 to ensure compliance of the underground storage tank 

 listed under clause (i) with this subtitle.

 ``(B) An underground storage tank described in this 

 subparagraph is an underground storage tank that is--

 ``(i) regulated under this subtitle; and

 ``(ii) owned or operated by the Federal, State, or 

 local government.

 ``(C) The Administrator shall make each report, received 

 under subparagraph (A), available to the public through an 

 appropriate media.

 ``(2) Financial incentive.--The Administrator may award to a 

 State that develops a report described in paragraph (1), in 

 addition to any other funds that the State is entitled to 

 receive under this subtitle, not more than $50,000, to be used 

 to carry out the report.

[[Page 119 STAT. 1098]]

 ``(3) Not a safe harbor.--This subsection does not relieve 

 any person from any obligation or requirement under this 

 subtitle.''.

 (c) Public Record.--Section 9002 of the Solid Waste Disposal Act (42 

U.S.C. 6991a) is amended by adding at the end the following:

 ``(d) Public Record.--

 ``(1) In general.--The Administrator shall require each 

 State that receives Federal funds to carry out this subtitle to 

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 maintain, update at least annually, and make available to the 

 public, in such manner and form as the Administrator shall 

 prescribe (after consultation with States), a record of 

 underground storage tanks regulated under this subtitle.

 ``(2) Considerations.--To the maximum extent practicable, 

 the public record of a State, respectively, shall include, for 

 each year--

 ``(A) the number, sources, and causes of underground 

 storage tank releases in the State;

 ``(B) the record of compliance by underground 

 storage tanks in the State with--

 ``(i) this subtitle; or

 ``(ii) an applicable State program approved 

 under section 9004; and

 ``(C) data on the number of underground storage tank 

 equipment failures in the State.''.

 (d) Incentive for Performance.--Section 9006 of the Solid Waste 

Disposal Act (42 U.S.C. 6991e) is amended by adding at the end the 

following:

 ``(e) Incentive for Performance.--Both of the following may be taken 

into account in determining the terms of a civil penalty under 

subsection (d):

 ``(1) The compliance history of an owner or operator in 

 accordance with this subtitle or a program approved under 

 section 9004.

 ``(2) Any other factor the Administrator considers 

 appropriate.''.

 (e) Table of Contents.--The table of contents for such subtitle I is 

amended by adding the following new item at the end thereof:

``Sec. 9011. Use of funds for release prevention and compliance.''.

SEC. 1527. DELIVERY PROHIBITION.

 (a) In General.--Subtitle I of the Solid Waste Disposal Act (42 

U.S.C. 6991 et seq.) is amended by adding at the end the following:

``SEC. 9012. <<NOTE: 42 USC 6991k.>> DELIVERY PROHIBITION.

 ``(a) Requirements.--

 ``(1) Prohibition <<NOTE: Effective date.>> of delivery or 

 deposit.--Beginning 2 years after the date of enactment of this 

 section, it shall be unlawful to deliver to, deposit into, or 

 accept a regulated substance into an underground storage tank at 

 a facility which has been identified by the Administrator or a 

 State implementing agency to be ineligible for such delivery, 

 deposit, or acceptance.

 ``(2) Guidance.--Within 1 <<NOTE: Deadline.>> year after the 

 date of enactment of this section, the Administrator shall, in 

 consultation with the States, underground storage tank owners, 

 and product delivery industries, publish guidelines detailing 

 the specific

[[Page 119 STAT. 1099]]

 processes and procedures they will use to implement the 

 provisions of this section. The processes and procedures 

 include, at a minimum--

 ``(A) the criteria for determining which underground 

 storage tank facilities are ineligible for delivery, 

 deposit, or acceptance of a regulated substance;

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 ``(B) the mechanisms for identifying which 

 facilities are ineligible for delivery, deposit, or 

 acceptance of a regulated substance to the underground 

 storage tank owning and fuel delivery industries;

 ``(C) the process for reclassifying ineligible 

 facilities as eligible for delivery, deposit, or 

 acceptance of a regulated substance;

 ``(D) one or more processes for providing adequate 

 notice to underground storage tank owners and operators 

 and supplier industries that an underground storage tank 

 has been determined to be ineligible for delivery, 

 deposit, or acceptance or a regulated substance; and

 ``(E) a delineation of, or a process for 

 determining, the specified geographic areas subject to 

 paragraph (4).

 ``(3) Compliance.--States that receive funding under this 

 subtitle shall, at a minimum, comply with the processes and 

 procedures published under paragraph (2).

 ``(4) Consideration.--

 ``(A) Rural and remote areas.--Subject to 

 subparagraph (B), the Administrator or a State may 

 consider not treating an underground storage tank as 

 ineligible for delivery, deposit, or acceptance of a 

 regulated substance if such treatment would jeopardize 

 the availability of, or access to, fuel in any rural and 

 remote areas unless an urgent threat to public health, 

 as determined by the Administrator, exists.

 ``(B) Applicability.--Subparagraph (A) shall apply 

 only during the 180-day period following the date of a 

 determination by the Administrator or the appropriate 

 State under subparagraph (A).

 ``(b) Effect on State Authority.--Nothing in this section shall 

affect or preempt the authority of a State to prohibit the delivery, 

deposit, or acceptance of a regulated substance to an underground 

storage tank.

 ``(c) Defense to Violation.--A person shall not be in violation of 

subsection (a)(1) if the person has not been provided with notice 

pursuant to subsection (a)(2)(D) of the ineligibility of a facility for 

delivery, deposit, or acceptance of a regulated substance as determined 

by the Administrator or a State, as appropriate, under this section.''.

 (b) Enforcement.--Section 9006(d)(2) of such Act (42 U.S.C. 

6991e(d)(2)) is amended as follows:

 (1) By adding the following new subparagraph after 

 subparagraph (D):

 ``(E) the delivery prohibition requirement established by 

 section 9012,''.

 (2) By adding the following new sentence at the end thereof: 

 ``Any person making or accepting a delivery or deposit of a 

 regulated substance to an underground storage tank at an 

 ineligible facility in violation of section 9012 shall also be 

 subject to the same civil penalty for each day of such 

 violation.''.

[[Page 119 STAT. 1100]]

 (c) Table of Contents.--The table of contents for such subtitle I is 

amended by adding the following new item at the end thereof:

``Sec. 9012. Delivery prohibition.''.

SEC. 1528. FEDERAL FACILITIES.

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 Section 9007 of the Solid Waste Disposal Act (42 U.S.C. 6991f) is 

amended to read as follows:

``SEC. 9007. <<NOTE: Penalties. Exemptions.>> FEDERAL FACILITIES.

 ``(a) In General.--Each department, agency, and instrumentality of 

the executive, legislative, and judicial branches of the Federal 

Government (1) having jurisdiction over any underground storage tank or 

underground storage tank system, or (2) engaged in any activity 

resulting, or which may result, in the installation, operation, 

management, or closure of any underground storage tank, release response 

activities related thereto, or in the delivery, acceptance, or deposit 

of any regulated substance to an underground storage tank or underground 

storage tank system shall be subject to, and comply with, all Federal, 

State, interstate, and local requirements, both substantive and 

procedural (including any requirement for permits or reporting or any 

provisions for injunctive relief and such sanctions as may be imposed by 

a court to enforce such relief), respecting underground storage tanks in 

the same manner, and to the same extent, as any person is subject to 

such requirements, including the payment of reasonable service charges. 

The Federal, State, interstate, and local substantive and procedural 

requirements referred to in this subsection include, but are not limited 

to, all administrative orders and all civil and administrative penalties 

and fines, regardless of whether such penalties or fines are punitive or 

coercive in nature or are imposed for isolated, intermittent, or 

continuing violations. The United States hereby expressly waives any 

immunity otherwise applicable to the United States with respect to any 

such substantive or procedural requirement (including, but not limited 

to, any injunctive relief, administrative order or civil or 

administrative penalty or fine referred to in the preceding sentence, or 

reasonable service charge). The reasonable service charges referred to 

in this subsection include, but are not limited to, fees or charges 

assessed in connection with the processing and issuance of permits, 

renewal of permits, amendments to permits, review of plans, studies, and 

other documents, and inspection and monitoring of facilities, as well as 

any other nondiscriminatory charges that are assessed in connection with 

a Federal, State, interstate, or local underground storage tank 

regulatory program. Neither the United States, nor any agent, employee, 

or officer thereof, shall be immune or exempt from any process or 

sanction of any State or Federal Court with respect to the enforcement 

of any such injunctive relief. No agent, employee, or officer of the 

United States shall be personally liable for any civil penalty under any 

Federal, State, interstate, or local law concerning underground storage 

tanks with respect to any act or omission within the scope of the 

official duties of the agent, employee, or officer. An agent, employee, 

or officer of the United States shall be subject to any criminal 

sanction (including, but not limited to, any fine or imprisonment) under 

any Federal or State law concerning underground storage tanks, but no 

department, agency, or instrumentality of the executive, legislative, or 

judicial branch of the Federal Government shall be subject to any

[[Page 119 STAT. 1101]]

such sanction. The President may exempt any underground storage tank of 

any department, agency, or instrumentality in the executive branch from 

compliance with such a requirement if he determines it to be in the 

paramount interest of the United States to do so. No such exemption 

shall be granted due to lack of appropriation unless the President shall 

have specifically requested such appropriation as a part of the 

budgetary process and the Congress shall have failed to make available 

such requested appropriation. Any exemption shall be for a period not in 

excess of 1 year, but additional exemptions may be granted for periods 

not to exceed 1 year upon the President's making a new 

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determination. <<NOTE: President. Reports.>> The President shall report 

each January to the Congress all exemptions from the requirements of 

this section granted during the preceding calendar year, together with 

his reason for granting each such exemption.

 ``(b) Review of and Report on Federal Underground Storage Tanks.--

 ``(1) <<NOTE: Deadline.>> Review.--Not later than 12 months 

 after the date of enactment of the Underground Storage Tank 

 Compliance Act, each Federal agency that owns or operates one or 

 more underground storage tanks, or that manages land on which 

 one or more underground storage tanks are located, shall submit 

 to the Administrator, the Committee on Energy and Commerce of 

 the United States House of Representatives, and the Committee on 

 the Environment and Public Works of the Senate a compliance 

 strategy report that--

 ``(A) lists the location and owner of each 

 underground storage tank described in this paragraph;

 ``(B) lists all tanks that are not in compliance 

 with this subtitle that are owned or operated by the 

 Federal agency;

 ``(C) specifies the date of the last inspection by a 

 State or Federal inspector of each underground storage 

 tank owned or operated by the agency;

 ``(D) lists each violation of this subtitle 

 respecting any underground storage tank owned or 

 operated by the agency;

 ``(E) describes the operator training that has been 

 provided to the operator and other persons having 

 primary daily on-site management responsibility for the 

 operation and maintenance of underground storage tanks 

 owned or operated by the agency; and

 ``(F) describes the actions that have been and will 

 be taken to ensure compliance for each underground 

 storage tank identified under subparagraph (B).

 ``(2) Not a safe harbor.--This subsection does not relieve 

 any person from any obligation or requirement under this 

 subtitle.''.

SEC. 1529. TANKS ON TRIBAL LANDS.

 (a) In General.--Subtitle I of the Solid Waste Disposal Act (42 

U.S.C. 6991 et seq.) is amended by adding the following at the end 

thereof:

``SEC. 9013. <<NOTE: 42 USC 6991l.>> TANKS ON TRIBAL LANDS.

 ``(a) Strategy.--The <<NOTE: Deadline.>> Administrator, in 

coordination with Indian tribes, shall, not later than 1 year after the 

date of enactment of this section, develop and implement a strategy--

 ``(1) giving priority to releases that present the greatest 

 threat to human health or the environment, to take necessary

[[Page 119 STAT. 1102]]

 corrective action in response to releases from leaking 

 underground storage tanks located wholly within the boundaries 

 of--

 ``(A) an Indian reservation; or

 ``(B) any other area under the jurisdiction of an 

 Indian tribe; and

 ``(2) to implement and enforce requirements concerning 

 underground storage tanks located wholly within the boundaries 

 of--

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 ``(A) an Indian reservation; or

 ``(B) any other area under the jurisdiction of an 

 Indian tribe.

 ``(b) Report.--Not later than 2 years after the date of enactment of 

this section, the Administrator shall submit to Congress a report that 

summarizes the status of implementation and enforcement of this subtitle 

in areas located wholly within--

 ``(1) the boundaries of Indian reservations; and

 ``(2) any other areas under the jurisdiction of an Indian 

 tribe.

The Administrator <<NOTE: Public information.>> shall make the report 

under this subsection available to the public.

 ``(c) Not a Safe Harbor.--This section does not relieve any person 

from any obligation or requirement under this subtitle.

 ``(d) State Authority.--Nothing in this section applies to any 

underground storage tank that is located in an area under the 

jurisdiction of a State, or that is subject to regulation by a State, as 

of the date of enactment of this section.''.

 (b) Table of Contents.--The table of contents for such subtitle I is 

amended by adding the following new item at the end thereof:

``Sec. 9013. Tanks on Tribal lands.''.

SEC. 1530. ADDITIONAL MEASURES TO PROTECT GROUNDWATER.

 (a) In General.--Section 9003 of the Solid Waste Disposal Act (42 

U.S.C. 6991b) is amended by adding the following new subsection at the 

end:

 ``(i) Additional Measures to Protect Groundwater From 

Contamination.--The Administrator shall require each State that receives 

funding under this subtitle to require one of the following:

 ``(1) Tank and piping secondary containment.--(A) Each new 

 underground storage tank, or piping connected to any such new 

 tank, installed after the effective date of this subsection, or 

 any existing underground storage tank, or existing piping 

 connected to such existing tank, that is replaced after the 

 effective date of this subsection, shall be secondarily 

 contained and monitored for leaks if the new or replaced 

 underground storage tank or piping is within 1,000 feet of any 

 existing community water system or any existing potable drinking 

 water well.

 ``(B) In the case of a new underground storage tank system 

 consisting of one or more underground storage tanks and 

 connected by piping, subparagraph (A) shall apply to all 

 underground storage tanks and connected pipes comprising such 

 system.

 ``(C) In the case of a replacement of an existing 

 underground storage tank or existing piping connected to the 

 underground storage tank, subparagraph (A) shall apply only to 

 the specific underground storage tank or piping being replaced,

[[Page 119 STAT. 1103]]

 not to other underground storage tanks and connected pipes 

 comprising such system.

 ``(D) Each installation of a new motor fuel dispenser 

 system, after the effective date of this subsection, shall 

 include under-dispenser spill containment if the new dispenser 

 is within 1,000 feet of any existing community water system or 

 any existing potable drinking water well.

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 ``(E) This paragraph shall not apply to repairs to an 

 underground storage tank, piping, or dispenser that are meant to 

 restore a tank, pipe, or dispenser to operating condition.

 ``(F) As used in this subsection:

 ``(i) The term `secondarily contained' means a 

 release detection and prevention system that meets the 

 requirements of 40 CFR 280.43(g), but shall not include 

 under-dispenser spill containment or control systems.

 ``(ii) The term `underground storage tank' has the 

 meaning given to it in section 9001, except that such 

 term does not include tank combinations or more than a 

 single underground pipe connected to a tank.

 ``(iii) The term `installation of a new motor fuel 

 dispenser system' means the installation of a new motor 

 fuel dispenser and the equipment necessary to connect 

 the dispenser to the underground storage tank system, 

 but does not mean the installation of a motor fuel 

 dispenser installed separately from the equipment need 

 to connect the dispenser to the underground storage tank 

 system.

 ``(2) Evidence of financial responsibility and 

 certification.--

 ``(A) Manufacturer and installer financial 

 responsibility.--A person that manufactures an 

 underground storage tank or piping for an underground 

 storage tank system or that installs an underground 

 storage tank system is required to maintain evidence of 

 financial responsibility under section 9003(d) in order 

 to provide for the costs of corrective actions directly 

 related to releases caused by improper manufacture or 

 installation unless the person can demonstrate 

 themselves to be already covered as an owner or operator 

 of an underground storage tank under section 9003.

 ``(B) Installer certification.--The Administrator 

 and each State that receives funding under this 

 subtitle, as appropriate, shall require that a person 

 that installs an underground storage tank system is--

 ``(i) certified or licensed by the tank and 

 piping manufacturer;

 ``(ii) certified or licensed by the 

 Administrator or a State, as appropriate;

 ``(iii) has their underground storage tank 

 system installation certified by a registered 

 professional engineer with education and 

 experience in underground storage tank system 

 installation;

 ``(iv) has had their installation of the 

 underground storage tank inspected and approved by 

 the Administrator or the State, as appropriate;

 ``(v) compliant with a code of practice 

 developed by a nationally recognized association 

 or independent

[[Page 119 STAT. 1104]]

 testing laboratory and in accordance with the 

 manufacturer's instructions; or

 ``(vi) compliant with another method that is 

 determined by the Administrator or a State, as 

 appropriate, to be no less protective of human 

 health and the environment.

 ``(C) Savings clause.--Nothing in subparagraph (A) 

 alters or affects the liability of any owner or operator 

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 of an underground storage tank.''.

 (b) Effective Date.--This <<NOTE: 42 USC 6991b note.>> subsection 

shall take effect 18 months after the date of enactment of this 

subsection.

 (c) Promulgation of <<NOTE: 42 USC 6991b note.>> Regulations or 

Guidelines.--The Administrator shall issue regulations or guidelines 

implementing the requirements of this subsection, including guidance to 

differentiate between the terms ``repair'' and ``replace'' for the 

purposes of section 9003(i)(1) of the Solid Waste Disposal Act.

 (d) Penalties.--Section 9006(d)(2) of such Act (42 U.S.C. 

6991e(d)(2)) is amended as follows:

 (1) By striking ``or'' at the end of subparagraph (B).

 (2) By inserting ``; or'' at the end of subparagraph (C).

 (3) By adding the following new subparagraph after 

 subparagraph (C):

 ``(D) the requirements established in section 

 9003(i),''.

SEC. 1531. AUTHORIZATION OF APPROPRIATIONS.

 (a) In General.--Subtitle I of the Solid Waste Disposal Act (42 

U.S.C. 6991 et seq.) is amended by adding at the end the following:

``SEC. 9014. <<NOTE: 42 USC 6991m.>> AUTHORIZATION OF APPROPRIATIONS.

 ``There are authorized to be appropriated to the Administrator the 

following amounts:

 ``(1) To carry out subtitle I (except sections 9003(h), 

 9005(c), 9011, and 9012) $50,000,000 for each of fiscal years 

 2005 through 2009.

 ``(2) From the Trust Fund, notwithstanding section 

 9508(c)(1) of the Internal Revenue Code of 1986--

 ``(A) to carry out section 9003(h) (except section 

 9003(h)(12)) $200,000,000 for each of fiscal years 2005 

 through 2009;

 ``(B) to carry out section 9003(h)(12), $200,000,000 

 for each of fiscal years 2005 through 2009;

 ``(C) to carry out sections 9003(i), 9004(f), and 

 9005(c) $100,000,000 for each of fiscal years 2005 

 through 2009; and

 ``(D) to carry out sections 9010, 9011, 9012, and 

 9013 $55,000,000 for each of fiscal years 2005 through 

 2009.''.

 (b) Table of Contents.--The table of contents for such subtitle I is 

amended by adding the following new item at the end thereof:

``Sec. 9014. Authorization of appropriations.''.

SEC. 1532. CONFORMING AMENDMENTS.

 (a) In General.--Section 9001 of the Solid Waste Disposal Act (42 

U.S.C. 6991) is amended as follows:

 (1) By striking ``For the purposes of this subtitle--'' and 

 inserting ``In this subtitle:''.

[[Page 119 STAT. 1105]]

 (2) By redesignating paragraphs (1), (2), (3), (4), (5), 

 (6), (7), and (8) as paragraphs (10), (7), (4), (3), (8), (5), 

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 (2), and (6), respectively.

 (3) By inserting before paragraph (2) (as redesignated by 

 paragraph (2) of this subsection) the following:

 ``(1) Indian tribe.--

 ``(A) In general.--The term `Indian tribe' means any 

 Indian tribe, band, nation, or other organized group or 

 community that is recognized as being eligible for 

 special programs and services provided by the United 

 States to Indians because of their status as Indians.

 ``(B) Inclusions.--The term `Indian tribe' includes 

 an Alaska Native village, as defined in or established 

 under the Alaska Native Claims Settlement Act (43 U.S.C. 

 1601 et seq.); and''.

 (4) By inserting after paragraph (8) (as redesignated by 

 paragraph (2) of this subsection) the following:

 ``(9) Trust fund.--The term `Trust Fund' means the Leaking 

 Underground Storage Tank Trust Fund established by section 9508 

 of the Internal Revenue Code of 1986.''.

 (b) Conforming Amendments.--The Solid Waste Disposal Act (42 U.S.C. 

6901 and following) is amended as follows:

 (1) Section 9003(f) (42 U.S.C. 6991b(f)) is amended--

 (A) in paragraph (1), by striking ``9001(2)(B)'' and 

 inserting ``9001(7)(B)''; and

 (B) in paragraphs (2) and (3), by striking 

 ``9001(2)(A)'' each place it appears and inserting 

 ``9001(7)(A)''.

 (2) Section 9003(h) (42 U.S.C. 6991b(h)) is amended in 

 paragraphs (1), (2)(C), (7)(A), and (11) by striking ``Leaking 

 Underground Storage Tank Trust Fund'' each place it appears and 

 inserting ``Trust Fund''.

 (3) Section 9009 (42 U.S.C. 6991h) is amended--

 (A) in subsection (a), by striking ``9001(2)(B)'' 

 and inserting ``9001(7)(B)''; and

 (B) in subsection (d), by striking ``section 9001(1) 

 (A) and (B)'' and inserting ``subparagraphs (A) and (B) 

 of section 9001(10)''.

SEC. 1533. TECHNICAL AMENDMENTS.

 The Solid Waste Disposal Act is amended as follows:

 (1) Section 9001(4)(A) (42 U.S.C. 6991(4)(A)) is amended by 

 striking ``sustances'' and inserting ``substances''.

 (2) Section 9003(f)(1) (42 U.S.C. 6991b(f)(1)) is amended by 

 striking ``subsection (c) and (d) of this section'' and 

 inserting ``subsections (c) and (d)''.

 (3) Section 9004(a) (42 U.S.C. 6991c(a)) is amended by 

 striking ``in 9001(2) (A) or (B) or both'' and inserting ``in 

 subparagraph (A) or (B) of section 9001(7)''.

 (4) Section 9005 (42 U.S.C. 6991d) is amended--

 (A) in subsection (a), by striking ``study taking'' 

 and inserting ``study, taking'';

 (B) in subsection (b)(1), by striking ``relevent'' 

 and inserting ``relevant''; and

 (C) in subsection (b)(4), by striking 

 ``Evironmental'' and inserting ``Environmental''.

[[Page 119 STAT. 1106]]

 Subtitle C--Boutique Fuels

SEC. 1541. REDUCING THE PROLIFERATION OF BOUTIQUE FUELS.

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 (a) Temporary Waivers During Supply Emergencies.--Section 

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

by inserting ``(i)'' after ``(C)'' and by adding the following new 

clauses at the end thereof:

 ``(ii) The Administrator may temporarily waive a control or 

prohibition respecting the use of a fuel or fuel additive required or 

regulated by the Administrator pursuant to subsection (c), (h), (i), 

(k), or (m) of this section or prescribed in an applicable 

implementation plan under section 110 approved by the Administrator 

under clause (i) of this subparagraph if, after consultation with, and 

concurrence by, the Secretary of Energy, the Administrator determines 

that--

 ``(I) extreme and unusual fuel or fuel additive supply 

 circumstances exist in a State or region of the Nation which 

 prevent the distribution of an adequate supply of the fuel or 

 fuel additive to consumers;

 ``(II) such extreme and unusual fuel and fuel additive 

 supply circumstances are the result of a natural disaster, an 

 Act of God, a pipeline or refinery equipment failure, or another 

 event that could not reasonably have been foreseen or prevented 

 and not the lack of prudent planning on the part of the 

 suppliers of the fuel or fuel additive to such State or region; 

 and

 ``(III) it is in the public interest to grant the waiver 

 (for example, when a waiver is necessary to meet projected 

 temporary shortfalls in the supply of the fuel or fuel additive 

 in a State or region of the Nation which cannot otherwise be 

 compensated for).

 ``(iii) If the Administrator makes the determinations required under 

clause (ii), such a temporary extreme and unusual fuel and fuel additive 

supply circumstances waiver shall be permitted only if--

 ``(I) the waiver applies to the smallest geographic area 

 necessary to address the extreme and unusual fuel and fuel 

 additive supply circumstances;

 ``(II) the waiver is effective for a period of 20 calendar 

 days or, if the Administrator determines that a shorter waiver 

 period is adequate, for the shortest practicable time period 

 necessary to permit the correction of the extreme and unusual 

 fuel and fuel additive supply circumstances and to mitigate 

 impact on air quality;

 ``(III) the waiver permits a transitional period, the exact 

 duration of which shall be determined by the Administrator (but 

 which shall be for the shortest practicable period), after the 

 termination of the temporary waiver to permit wholesalers and 

 retailers to blend down their wholesale and retail inventory;

 ``(IV) the waiver applies to all persons in the motor fuel 

 distribution system; and

 ``(V) the Administrator has given public notice to all 

 parties in the motor fuel distribution system, and local and 

 State regulators, in the State or region to be covered by the 

 waiver.

The term `motor fuel distribution system' as used in this clause shall 

be defined by the Administrator through rulemaking.

[[Page 119 STAT. 1107]]

 ``(iv) <<NOTE: Regulations. Deadline.>> Within 180 days of the date 

of enactment of this clause, the Administrator shall promulgate 

regulations to implement clauses (ii) and (iii).

 ``(v) Nothing in this subparagraph shall--

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 ``(I) limit or otherwise affect the application of any other 

 waiver authority of the Administrator pursuant to this section 

 or pursuant to a regulation promulgated pursuant to this 

 section; and

 ``(II) subject any State or person to an enforcement action, 

 penalties, or liability solely arising from actions taken 

 pursuant to the issuance of a waiver under this subparagraph.''.

 (b) Limit on Number of Boutique Fuels.--Section 211(c)(4)(C) of the 

Clean Air Act (42 U.S.C. 7545(c)(4)(C)), as amended by subsection (a), 

is further amended by adding at the end the following:

 ``(v)(I) The Administrator shall have no authority, when considering 

a State implementation plan or a State implementation plan revision, to 

approve under this paragraph any fuel included in such plan or revision 

if the effect of such approval increases the total number of fuels 

approved under this paragraph as of September 1, 2004, in all State 

implementation plans.

 ``(II) <<NOTE: Deadline. Federal Register, publication. Public 

information.>> The Administrator, in consultation with the Secretary of 

Energy, shall determine the total number of fuels approved under this 

paragraph as of September 1, 2004, in all State implementation plans and 

shall publish a list of such fuels, including the States and Petroleum 

Administration for Defense District in which they are used, in the 

Federal Register for public review and comment no later than 90 days 

after enactment.

 ``(III) The Administrator shall remove a fuel from the list 

published under subclause (II) if a fuel ceases to be included in a 

State implementation plan or if a fuel in a State implementation plan is 

identical to a Federal fuel formulation implemented by the 

Administrator, but the Administrator shall not reduce the total number 

of fuels authorized under the list published under subclause (II).

 ``(IV) Subclause (I) shall not limit the Administrator's authority 

to approve a control or prohibition respecting any new fuel under this 

paragraph in a State implementation plan or revision to a State 

implementation plan if such new fuel--

 ``(aa) completely replaces a fuel on the list published 

 under subclause (II); or

 ``(bb) does not increase the total number of fuels on the 

 list published under subclause (II) as of September 1, 2004.

In the <<NOTE: Supply. Federal Register, publication.>> event that the 

total number of fuels on the list published under subclause (II) at the 

time of the Administrator's consideration of a control or prohibition 

respecting a new fuel is lower than the total number of fuels on such 

list as of September 1, 2004, the Administrator may approve a control or 

prohibition respecting a new fuel under this subclause if the 

Administrator, after consultation with the Secretary of Energy, 

publishes in the Federal Register after notice and comment a finding 

that, in the Administrator's judgment, such control or prohibition 

respecting a new fuel will not cause fuel supply or distribution 

interruptions or have a significant adverse impact on fuel producibility 

in the affected area or contiguous areas.

 ``(V) The Administrator shall have no authority under this 

paragraph, when considering any particular State's implementation

[[Page 119 STAT. 1108]]

plan or a revision to that State's implementation plan, to approve any 

fuel unless that fuel was, as of the date of such consideration, 

approved in at least one State implementation plan in the applicable 

Petroleum Administration for Defense District. However, the 

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Administrator may approve as part of a State implementation plan or 

State implementation plan revision a fuel with a summertime Reid Vapor 

Pressure of 7.0 psi. In no event shall such approval by the 

Administrator cause an increase in the total number of fuels on the list 

published under subclause (II).

 ``(VI) Nothing in this clause shall be construed to have any effect 

regarding any available authority of States to require the use of any 

fuel additive registered in accordance with subsection (b), including 

any fuel additive registered in accordance with subsection (b) after the 

enactment of this subclause.''.

 (c) Study and Report to Congress on Boutique Fuels.--

 (1) Joint study.--The Administrator of the Environmental 

 Protection Agency and the Secretary shall undertake a study of 

 the effects on air quality, on the number of fuel blends, on 

 fuel availability, on fuel fungibility, and on fuel costs of the 

 State plan provisions adopted pursuant to section 211(c)(4)(C) 

 of the Clean Air Act (42 U.S.C. 7545(c)(4)(C)).

 (2) Focus of study.--The primary focus of the study required 

 under paragraph (1) shall be to determine how to develop a 

 Federal fuels system that maximizes motor fuel fungibility and 

 supply, addresses air quality requirements, and reduces motor 

 fuel price volatility including that which has resulted from the 

 proliferation of boutique fuels, and to recommend to Congress 

 such legislative changes as are necessary to implement such a 

 system. The study should include the impacts on overall energy 

 supply, distribution, and use as a result of the legislative 

 changes recommended.

 (3) Conduct of study.--In <<NOTE: Science and 

 technology.>> carrying out their joint duties under this 

 section, the Administrator and the Secretary shall use sound 

 science and objective science practices, shall consider the best 

 available science, shall use data collected by accepted means 

 and shall consider and include a description of the weight of 

 the scientific evidence. The Administrator and the Secretary 

 shall coordinate the study required by this section with other 

 studies required by the Act.

 (4) Responsibility of administrator.--In carrying out the 

 study required by this section, the Administrator shall 

 coordinate obtaining comments from affected parties interested 

 in the air quality impact assessment portion of the study.

 (5) Responsibility of secretary.--In carrying out the study 

 required by this section, the Secretary shall coordinate 

 obtaining comments from affected parties interested in the fuel 

 availability, number of fuel blends, fuel fungibility, and fuel 

 costs portion of the study.

 (6) Report to congress.--

 The <<NOTE: Deadline.>> Administrator and the Secretary jointly 

 shall submit the results of the study required by this section 

 in a report to the Congress not later than 12 months after the 

 date of the enactment of this Act, together with any recommended 

 regulatory and legislative changes. Such report shall be 

 submitted to the Committee on Energy and Commerce of the United 

 States House of Representatives and the Committees on Energy and 

 Natural Resources and on Environment and Public Works of the 

 Senate.

[[Page 119 STAT. 1109]]

 (7) Authorization of appropriations.--There is authorized to 

 be appropriated jointly to the Administrator and the Secretary 

 $500,000 for the completion of the study required under this 

 subsection.

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 (d) Definitions.--In this section:

 (1) The term ``Administrator'' means the Administrator of 

 the Environmental Protection Agency.

 (2) The term ``fuel'' means gasoline, diesel fuel, and any 

 other liquid petroleum product commercially known as gasoline 

 and diesel fuel for use in highway and nonroad motor vehicles.

 (3) The term ``a control or prohibition respecting a new 

 fuel'' means a control or prohibition on the formulation, 

 composition, or emissions characteristics of a fuel that would 

 require the increase or decrease of a constituent in gasoline or 

 diesel fuel.

 TITLE XVI--CLIMATE CHANGE

 Subtitle A--National Climate Change Technology Deployment

SEC. 1601. GREENHOUSE GAS INTENSITY REDUCING TECHNOLOGY STRATEGIES.

 Title XVI of the Energy Policy Act of 1992 (42 U.S.C. 13381 et seq.) 

is amended by adding at the end the following:

``SEC. 1610. <<NOTE: 42 USC 13389.>> GREENHOUSE GAS INTENSITY REDUCING 

 STRATEGIES.

 ``(a) Definitions.--In this section:

 ``(1) Advisory committee.--The term `Advisory Committee' 

 means the Climate Change Technology Advisory Committee 

 established under subsection (f)(1).

 ``(2) Carbon sequestration.--The term `carbon sequestration' 

 means the capture of carbon dioxide through terrestrial, 

 geological, biological, or other means, which prevents the 

 release of carbon dioxide into the atmosphere.

 ``(3) Committee.--The term `Committee' means the Committee 

 on Climate Change Technology established under subsection 

 (b)(1).

 ``(4) Developing country.--The term `developing country' has 

 the meaning given the term in section 1608(m).

 ``(5) Greenhouse gas.--The term `greenhouse gas' means--

 ``(A) carbon dioxide;

 ``(B) methane;

 ``(C) nitrous oxide;

 ``(D) hydrofluorocarbons;

 ``(E) perfluorocarbons; and

 ``(F) sulfur hexafluoride.

 ``(6) Greenhouse gas intensity.--The term `greenhouse gas 

 intensity' means the ratio of greenhouse gas emissions to 

 economic output.

 ``(7) National laboratory.--The term `National Laboratory' 

 has the meaning given the term in section 3(3) of the Energy 

 Policy Act of 2005.

 ``(b) Committee on <<NOTE: Establishment. Deadline.>> Climate Change 

Technology.--

[[Page 119 STAT. 1110]]

 ``(1) In general.--Not later than 180 days after the date of 

 enactment of this section, the President shall establish a 

 Committee on Climate Change Technology to--

 ``(A) integrate current Federal climate reports; and

 ``(B) coordinate Federal climate change technology 

 activities and programs carried out in furtherance of 

 the strategy developed under subsection (c)(1).

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 ``(2) Membership.--The Committee shall be composed of at 

 least 7 members, including--

 ``(A) the Secretary, who shall chair the Committee;

 ``(B) the Secretary of Commerce;

 ``(C) the Chairman of the Council on Environmental 

 Quality;

 ``(D) the Secretary of Agriculture;

 ``(E) the Administrator of the Environmental 

 Protection Agency;

 ``(F) the Secretary of Transportation;

 ``(G) the Director of the Office of Science and 

 Technology Policy; and

 ``(H) other representatives as may be determined by 

 the President.

 ``(3) Staff.--The members of the Committee shall provide 

 such personnel as are necessary to enable the Committee to 

 perform its duties.

 ``(c) National <<NOTE: Research and development. Deadline.>> Climate 

Change Technology Policy.--

 ``(1) In general.--Not later than 18 months after the date 

 of enactment of this section, the Committee shall, based on 

 applicable Federal climate reports, submit to the Secretary and 

 the President a national strategy to promote the deployment and 

 commercialization of greenhouse gas intensity reducing 

 technologies and practices developed through research and 

 development programs conducted by the National Laboratories, 

 other Federal research facilities, institutions of higher 

 education, and the private sector.

 ``(2) Updates.--The Committee shall--

 ``(A) <<NOTE: Public information.>> at the time of 

 submission of the strategy to the President under 

 paragraph (1), also make the strategy available to the 

 public; and

 ``(B) update the strategy every 5 years, or more 

 frequently as the Committee determines to be necessary.

 ``(d) Climate <<NOTE: Establishment. Deadline.>> Change Technology 

Program.--Not later than 180 days after the date on which the Committee 

is established under subsection (b)(1), the Secretary, in consultation 

with the Committee, shall establish within the Department of Energy the 

Climate Change Technology Program to--

 ``(1) assist the Committee in the interagency coordination 

 of climate change technology research, development, 

 demonstration, and deployment to reduce greenhouse gas 

 intensity; and

 ``(2) carry out the programs authorized under this section.

 ``(e) Technology Inventory.--

 ``(1) In general.--The <<NOTE: Public 

 information.>> Secretary shall conduct and make public an 

 inventory and evaluation of greenhouse gas intensity reducing 

 technologies that have been developed, or are under development, 

 by the National Laboratories, other Federal research facilities, 

 institutions of higher education, and the private sector to 

 determine which technologies are suitable for commercialization 

 and deployment.

[[Page 119 STAT. 1111]]

 ``(2) Report.--Not later than 180 days after the completion 

 of the inventory under paragraph (1), the Secretary shall submit 

 to Congress a report that includes the results of the completed 

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 inventory and any recommendations of the Secretary.

 ``(3) Use.--The Secretary shall use the results of the 

 inventory as guidance in the commercialization and deployment of 

 greenhouse gas intensity reducing technologies.

 ``(4) Updated inventory.--The Secretary shall--

 ``(A) periodically update the inventory under 

 paragraph (1), including when determined necessary by 

 the Committee; and

 ``(B) make the updated inventory available to the 

 public.

 ``(f) Climate Change Technology Advisory Committee.--

 ``(1) In general.--The Secretary, in consultation with the 

 Committee, may establish under section 624 of the Department of 

 Energy Organization Act (42 U.S.C. 7234) a Climate Change 

 Technology Advisory Committee to identify statutory, regulatory, 

 economic, and other barriers to the commercialization and 

 deployment of greenhouse gas intensity reducing technologies and 

 practices in the United States.

 ``(2) Composition.--The Advisory Committee shall be composed 

 of the following members, to be appointed by the Secretary, in 

 consultation with the Committee:

 ``(A) 1 representative shall be appointed from each 

 National Laboratory.

 ``(B) 3 members shall be representatives of energy-

 producing trade organizations.

 ``(C) 3 members shall represent energy-intensive 

 trade organizations.

 ``(D) 3 members shall represent groups that 

 represent end-use energy and other consumers.

 ``(E) 3 members shall be employees of the Federal 

 Government who are experts in energy technology, 

 intellectual property, and tax.

 ``(F) 3 members shall be representatives of 

 institutions of higher education with expertise in 

 energy technology development that are recommended by 

 the National Academy of Engineering.

 ``(3) Report.--Not later than 1 year after the date of 

 enactment of this section and annually thereafter, the Advisory 

 Committee shall submit to the Committee a report that 

 describes--

 ``(A) the findings of the Advisory Committee; and

 ``(B) any recommendations of the Advisory Committee 

 for the removal or reduction of barriers to 

 commercialization, deployment, and increasing the use of 

 greenhouse gas intensity reducing technologies and 

 practices.

 ``(g) Greenhouse Gas Intensity Reducing Technology Deployment.--

 ``(1) In general.--Based on the strategy developed under 

 subsection (c)(1), the technology inventory conducted under 

 subsection (e)(1), the greenhouse gas intensity reducing 

 technology study report submitted under subsection (e)(2), and 

 reports under subsection (f)(3), if any, the Committee shall 

 develop recommendations that would provide for the removal of

[[Page 119 STAT. 1112]]

 domestic barriers to the commercialization and deployment of 

 greenhouse gas intensity reducing technologies and practices.

 ``(2) Requirements.--In developing the recommendations under 

 paragraph (1), the Committee shall consider in the aggregate--

 ``(A) the cost-effectiveness of the technology;

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 ``(B) fiscal and regulatory barriers;

 ``(C) statutory and other barriers; and

 ``(D) intellectual property issues.

 ``(3) Demonstration projects.--In developing recommendations 

 under paragraph (1), the Committee may identify the need for 

 climate change technology demonstration projects.

 ``(4) Report.--Not later than 18 months after the date of 

 enactment of this section, the Committee shall submit to the 

 President and Congress a report that--

 ``(A) identifies, based on the report submitted 

 under subsection (f)(3), any barriers to, and commercial 

 risks associated with, the deployment of greenhouse gas 

 intensity reducing technologies; and

 ``(B) includes a plan for carrying out demonstration 

 projects.

 ``(5) Updates.--The Committee shall--

 ``(A) <<NOTE: Public information.>> at the time of 

 submission of the report to Congress under paragraph 

 (4), also make the report available to the public; and

 ``(B) update the report every 5 years, or more 

 frequently as the Committee determines to be necessary.

 ``(h) Procedures for <<NOTE: Notification. Public 

information.>> Calculating, Monitoring, and Analyzing Greenhouse Gas 

Intensity.--The Secretary, in collaboration with the Committee and the 

National Institute of Standards and Technology, and after public notice 

and opportunity for comment, shall develop standards and best practices 

for calculating, monitoring, and analyzing greenhouse gas intensity.

 ``(i) Demonstration Projects.--

 ``(1) In general.--The Secretary shall, subject to the 

 availability of appropriations, support demonstration projects 

 that--

 ``(A) increase the reduction of the greenhouse gas 

 intensity to levels below that which would be achieved 

 by technologies being used in the United States as of 

 the date of enactment of this section;

 ``(B) maximize the potential return on Federal 

 investment;

 ``(C) demonstrate distinct roles in public-private 

 partnerships;

 ``(D) produce a large-scale reduction of greenhouse 

 gas intensity if commercialization occurred; and

 ``(E) support a diversified portfolio to mitigate 

 the uncertainty associated with a single technology.

 ``(2) Cost sharing.--In supporting a demonstration project 

 under this subsection, the Secretary shall require cost-sharing 

 in accordance with section 988 of the Energy Policy Act of 2005.

 ``(3) Authorization of appropriations.--There are authorized 

 to be appropriated such sums as are necessary to carry out this 

 subsection.

[[Page 119 STAT. 1113]]

 ``(j) Cooperative Research and Development Agreements.--In carrying 

out greenhouse gas intensity reduction research and technology 

deployment activities under this subtitle, the Secretary may enter into 

cooperative research and development agreements under section 12 of the 

Stevenson-Wydler Technology Innovation Act of 1980 (15 U.S.C. 3710a).''.

Subtitle B--Climate Change Technology Deployment in Developing Countries

SEC. 1611. CLIMATE CHANGE TECHNOLOGY DEPLOYMENT IN DEVELOPING COUNTRIES.

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 The Global Environmental Protection Assistance Act of 1989 (Public 

Law 101-240; 103 Stat. 2521) is amending by adding at the end the 

following:

 ``PART C--TECHNOLOGY DEPLOYMENT IN DEVELOPING COUNTRIES

``SEC. 731. <<NOTE: 22 USC 7901.>> DEFINITIONS.

 ``In this part:

 ``(1) Carbon sequestration.--The term `carbon sequestration' 

 means the capture of carbon dioxide through terrestrial, 

 geological, biological, or other means, which prevents the 

 release of carbon dioxide into the atmosphere.

 ``(2) Greenhouse gas.--The term `greenhouse gas' means 

 carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, 

 perfluorocarbons, and sulfur hexafluoride.

 ``(3) Greenhouse gas intensity.--The term `greenhouse gas 

 intensity' means the ratio of greenhouse gas emissions to 

 economic output.

``SEC. 732. <<NOTE: 22 USC 7902.>> REDUCTION OF GREENHOUSE GAS 

 INTENSITY.

 ``(a) Lead Agency.--

 ``(1) In general.--The Department of State shall act as the 

 lead agency for integrating into United States foreign policy 

 the goal of reducing greenhouse gas intensity in developing 

 countries.

 ``(2) Reports.--

 ``(A) Initial report.--Not later than 180 days after 

 the date of enactment of this part, the Secretary of 

 State shall submit to the appropriate authorizing and 

 appropriating committees of Congress an initial report, 

 based on the most recent information available to the 

 Secretary from reliable public sources, that identifies 

 the 25 developing countries that are the largest 

 greenhouse gas emitters, including for each country--

 ``(i) an estimate of the quantity and types of 

 energy used;

 ``(ii) an estimate of the greenhouse gas 

 intensity of the energy, manufacturing, 

 agricultural, and transportation sectors;

 ``(iii) a description the progress of any 

 significant projects undertaken to reduce 

 greenhouse gas intensity;

[[Page 119 STAT. 1114]]

 ``(iv) a description of the potential for 

 undertaking projects to reduce greenhouse gas 

 intensity;

 ``(v) a description of any obstacles to the 

 reduction of greenhouse gas intensity; and

 ``(vi) a description of the best practices 

 learned by the Agency for International 

 Development from conducting previous pilot and 

 demonstration projects to reduce greenhouse gas 

 intensity.

 ``(B) Update.--Not later than 18 months after the 

 date on which the initial report is submitted under 

 subparagraph (A), the Secretary shall submit to the 

 appropriate authorizing and appropriating committees of 

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 Congress, based on the best information available to the 

 Secretary, an update of the information provided in the 

 initial report.

 ``(C) Use.--

 ``(i) Initial report.--The Secretary of State 

 shall use the initial report submitted under 

 subparagraph (A) to establish baselines for the 

 developing countries identified in the report with 

 respect to the information provided under clauses 

 (i) and (ii) of that subparagraph.

 ``(ii) Annual reports.--The Secretary of State 

 shall use the annual reports prepared under 

 subparagraph (B) and any other information 

 available to the Secretary to track the progress 

 of the developing countries with respect to 

 reducing greenhouse gas intensity.

 ``(b) Projects.--The Secretary of State, in coordination with 

Administrator of the United States Agency for International Development, 

shall (directly or through agreements with the World Bank, the 

International Monetary Fund, the Overseas Private Investment 

Corporation, and other development institutions) provide assistance to 

developing countries specifically for projects to reduce greenhouse gas 

intensity, including projects to--

 ``(1) leverage, through bilateral agreements, funds for 

 reduction of greenhouse gas intensity;

 ``(2) increase private investment in projects and activities 

 to reduce greenhouse gas intensity; and

 ``(3) expedite the deployment of technology to reduce 

 greenhouse gas intensity.

 ``(c) Focus.--In providing assistance under subsection (b), the 

Secretary of State shall focus on--

 ``(1) promoting the rule of law, property rights, contract 

 protection, and economic freedom; and

 ``(2) increasing capacity, infrastructure, and training.

 ``(d) Priority.--In providing assistance under subsection (b), the 

Secretary of State shall give priority to projects in the 25 developing 

countries identified in the report submitted under subsection (a)(2)(A).

``SEC. 733. <<NOTE: 22 USC 7903.>> TECHNOLOGY INVENTORY FOR DEVELOPING 

 COUNTRIES.

 ``(a) In General.--The Secretary of Energy, in coordination with the 

Secretary of State and the Secretary of Commerce, shall conduct an 

inventory of greenhouse gas intensity reducing technologies that are 

developed, or under development in the United States, to identify 

technologies that are suitable for transfer to, deployment in, and 

commercialization in the developing countries identified in the report 

submitted under section 732(a)(2)(A).

[[Page 119 STAT. 1115]]

 ``(b) Report.--Not later than 180 days after the completion of the 

inventory under subsection (a), the Secretary of State and the Secretary 

of Energy shall jointly submit to Congress a report that--

 ``(1) includes the results of the completed inventory;

 ``(2) identifies obstacles to the transfer, deployment, and 

 commercialization of the inventoried technologies;

 ``(3) includes results from previous Federal reports related 

 to the inventoried technologies; and

 ``(4) includes an analysis of market forces related to the 

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 inventoried technologies.

``SEC. 734. <<NOTE: 22 USC 7904.>> TRADE-RELATED BARRIERS TO EXPORT OF 

 GREENHOUSE GAS INTENSITY REDUCING TECHNOLOGIES.

 ``(a) In General.--Not <<NOTE: Deadline.>> later than 1 year after 

the date of enactment of this part, the United States Trade 

Representative shall (as appropriate and consistent with applicable 

bilateral, regional, and mutual trade agreements)--

 ``(1) identify trade-relations barriers maintained by 

 foreign countries to the export of greenhouse gas intensity 

 reducing technologies and practices from the United States to 

 the developing countries identified in the report submitted 

 under section 732(a)(2)(A); and

 ``(2) negotiate with foreign countries for the removal of 

 those barriers.

 ``(b) Annual Report.--Not later than 1 year after the date on which 

a report is submitted under subsection (a)(1) and annually thereafter, 

the United States Trade Representative shall submit to Congress a report 

that describes any progress made with respect to removing the barriers 

identified by the United States Trade Representative under subsection 

(a)(1).

``SEC. 735. <<NOTE: 22 USC 7905.>> GREENHOUSE GAS INTENSITY REDUCING 

 TECHNOLOGY EXPORT INITIATIVE.

 ``(a) In General.--There is <<NOTE: Establishment.>> established an 

interagency working group to carry out a Greenhouse Gas Intensity 

Reducing Technology Export Initiative to--

 ``(1) promote the export of greenhouse gas intensity 

 reducing technologies and practices from the United States;

 ``(2) identify developing countries that should be 

 designated as priority countries for the purpose of exporting 

 greenhouse gas intensity reducing technologies and practices, 

 based on the report submitted under section 732(a)(2)(A);

 ``(3) identify potential barriers to adoption of exported 

 greenhouse gas intensity reducing technologies and practices 

 based on the reports submitted under section 734; and

 ``(4) identify previous efforts to export energy 

 technologies to learn best practices.

 ``(b) Composition.--The working group shall be composed of--

 ``(1) the Secretary of State, who shall act as the head of 

 the working group;

 ``(2) the Administrator of the United States Agency for 

 International Development;

 ``(3) the United States Trade Representative;

 ``(4) a designee of the Secretary of Energy;

 ``(5) a designee of the Secretary of Commerce; and

 ``(6) a designee of the Administrator of the Environmental 

 Protection Agency.

[[Page 119 STAT. 1116]]

 ``(c) Performance Reviews and Reports.--Not later than 180 days 

after the date of enactment of this part and each year thereafter, the 

interagency working group shall--

 ``(1) conduct a performance review of actions taken and 

 results achieved by the Federal Government (including each of 

 the agencies represented on the interagency working group) to 

 promote the export of greenhouse gas intensity reducing 

 technologies and practices from the United States; and

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 ``(2) submit to the appropriate authorizing and 

 appropriating committees of Congress a report that describes the 

 results of the performance reviews and evaluates progress in 

 promoting the export of greenhouse gas intensity reducing 

 technologies and practices from the United States, including any 

 recommendations for increasing the export of the technologies 

 and practices.

``SEC. 736. <<NOTE: 22 USC 7906.>> TECHNOLOGY DEMONSTRATION PROJECTS.

 ``(a) In General.--The Secretary of State, in coordination with the 

Secretary of Energy and the Administrator of the United States Agency 

for International Development, shall promote the adoption of 

technologies and practices that reduce greenhouse gas intensity in 

developing countries in accordance with this section.

 ``(b) Demonstration Projects.--

 ``(1) In general.--The Secretaries and the Administrator 

 shall plan, coordinate, and carry out, or provide assistance for 

 the planning, coordination, or carrying out of, demonstration 

 projects under this section in at least 10 eligible countries, 

 as determined by the Secretaries and the Administrator.

 ``(2) Eligibility.--A country shall be eligible for 

 assistance under this subsection if the Secretaries and the 

 Administrator determine that the country has demonstrated a 

 commitment to--

 ``(A) just governance, including--

 ``(i) promoting the rule of law;

 ``(ii) respecting human and civil rights;

 ``(iii) protecting private property rights; 

 and

 ``(iv) combating corruption; and

 ``(B) economic freedom, including economic policies 

 that--

 ``(i) encourage citizens and firms to 

 participate in global trade and international 

 capital markets;

 ``(ii) promote private sector growth and the 

 sustainable management of natural resources; and

 ``(iii) strengthen market forces in the 

 economy.

 ``(3) Selection.--In determining which eligible countries to 

 provide assistance to under paragraph (1), the Secretaries and 

 the Administrator shall consider--

 ``(A) the opportunity to reduce greenhouse gas 

 intensity in the eligible country; and

 ``(B) the opportunity to generate economic growth in 

 the eligible country.

 ``(4) Types of projects.--Demonstration projects under this 

 section may include--

 ``(A) coal gasification, coal liquefaction, and 

 clean coal projects;

 ``(B) carbon sequestration projects;

 ``(C) cogeneration technology initiatives;

[[Page 119 STAT. 1117]]

 ``(D) renewable projects; and

 ``(E) lower emission transportation.

``SEC. 737. <<NOTE: 22 USC 7907.>> FELLOWSHIP AND EXCHANGE PROGRAMS.

 ``The Secretary of State, in coordination with the Secretary of 

Energy, the Secretary of Commerce, and the Administrator of the 

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Environmental Protection Agency, shall carry out fellowship and exchange 

programs under which officials from developing countries visit the 

United States to acquire expertise and knowledge of best practices to 

reduce greenhouse gas intensity in their countries.

``SEC. 738. <<NOTE: 22 USC 7908.>> AUTHORIZATION OF APPROPRIATIONS.

 ``There are authorized to be appropriated such sums as are necessary 

to carry out this part.

``SEC. 739. <<NOTE: 22 USC 7901 note.>> EFFECTIVE DATE.

 ``Except as otherwise provided in this part, this part takes effect 

on October 1, 2005.''.

 TITLE XVII--INCENTIVES FOR INNOVATIVE TECHNOLOGIES

SEC. 1701. <<NOTE: 22 USC 16511.>> DEFINITIONS.

 In this title:

 (1) Commercial technology.--

 (A) In general.--The term ``commercial technology'' 

 means a technology in general use in the commercial 

 marketplace.

 (B) Inclusions.--The term ``commercial technology'' 

 does not include a technology solely by use of the 

 technology in a demonstration project funded by the 

 Department.

 (2) Cost.--The term ``cost'' has the meaning given the term 

 ``cost of a loan guarantee'' within the meaning of section 

 502(5)(C) of the Federal Credit Reform Act of 1990 (2 U.S.C. 

 661a(5)(C)).

 (3) Eligible project.--The term ``eligible project'' means a 

 project described in section 1703.

 (4) Guarantee.--

 (A) In general.--The term ``guarantee'' has the 

 meaning given the term ``loan guarantee'' in section 502 

 of the Federal Credit Reform Act of 1990 (2 U.S.C. 

 661a).

 (B) Inclusion.--The term ``guarantee'' includes a 

 loan guarantee commitment (as defined in section 502 of 

 the Federal Credit Reform Act of 1990 (2 U.S.C. 661a)).

 (5) Obligation.--The term ``obligation'' means the loan or 

 other debt obligation that is guaranteed under this section.

SEC. 1702. <<NOTE: 22 USC 16512.>> TERMS AND CONDITIONS.

 (a) In General.--Except for division C of Public Law 108-324, the 

Secretary shall make guarantees under this or any other Act for projects 

on such terms and conditions as the Secretary determines, after 

consultation with the Secretary of the Treasury, only in accordance with 

this section.

 (b) Specific Appropriation or Contribution.--No guarantee shall be 

made unless--

 (1) an appropriation for the cost has been made; or

[[Page 119 STAT. 1118]]

 (2) the Secretary has received from the borrower a payment 

 in full for the cost of the obligation and deposited the payment 

 into the Treasury.

 (c) Amount.--Unless otherwise provided by law, a guarantee by the 

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Secretary shall not exceed an amount equal to 80 percent of the project 

cost of the facility that is the subject of the guarantee, as estimated 

at the time at which the guarantee is issued.

 (d) Repayment.--

 (1) In general.--No guarantee shall be made unless the 

 Secretary determines that there is reasonable prospect of 

 repayment of the principal and interest on the obligation by the 

 borrower.

 (2) Amount.--No guarantee shall be made unless the Secretary 

 determines that the amount of the obligation (when combined with 

 amounts available to the borrower from other sources) will be 

 sufficient to carry out the project.

 (3) Subordination.--The obligation shall be subject to the 

 condition that the obligation is not subordinate to other 

 financing.

 (e) Interest Rate.--An obligation shall bear interest at a rate that 

does not exceed a level that the Secretary determines appropriate, 

taking into account the prevailing rate of interest in the private 

sector for similar loans and risks.

 (f) Term.--The term of an obligation shall require full repayment 

over a period not to exceed the lesser of--

 (1) 30 years; or

 (2) 90 percent of the projected useful life of the physical 

 asset to be financed by the obligation (as determined by the 

 Secretary).

 (g) Defaults.--

 (1) Payment by secretary.--

 (A) In general.--If a borrower defaults on the 

 obligation (as defined in regulations promulgated by the 

 Secretary and specified in the guarantee contract), the 

 holder of the guarantee shall have the right to demand 

 payment of the unpaid amount from the Secretary.

 (B) Payment required.--Within such period as may be 

 specified in the guarantee or related agreements, the 

 Secretary shall pay to the holder of the guarantee the 

 unpaid interest on, and unpaid principal of the 

 obligation as to which the borrower has defaulted, 

 unless the Secretary finds that there was no default by 

 the borrower in the payment of interest or principal or 

 that the default has been remedied.

 (C) Forbearance.--Nothing in this subsection 

 precludes any forbearance by the holder of the 

 obligation for the benefit of the borrower which may be 

 agreed upon by the parties to the obligation and 

 approved by the Secretary.

 (2) Subrogation.--

 (A) In general.--If the Secretary makes a payment 

 under paragraph (1), the Secretary shall be subrogated 

 to the rights of the recipient of the payment as 

 specified in the guarantee or related agreements 

 including, where appropriate, the authority 

 (notwithstanding any other provision of law) to--

[[Page 119 STAT. 1119]]

 (i) complete, maintain, operate, lease, or 

 otherwise dispose of any property acquired 

 pursuant to such guarantee or related agreements; 

 or

 (ii) permit the borrower, pursuant to an 

 agreement with the Secretary, to continue to 

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 pursue the purposes of the project if the 

 Secretary determines this to be in the public 

 interest.

 (B) Superiority of rights.--The rights of the 

 Secretary, with respect to any property acquired 

 pursuant to a guarantee or related agreements, shall be 

 superior to the rights of any other person with respect 

 to the property.

 (C) Terms and conditions.--A guarantee agreement 

 shall include such detailed terms and conditions as the 

 Secretary determines appropriate to--

 (i) protect the interests of the United States 

 in the case of default; and

 (ii) have available all the patents and 

 technology necessary for any person selected, 

 including the Secretary, to complete and operate 

 the project.

 (3) Payment of principal and interest by secretary.--With 

 respect to any obligation guaranteed under this section, the 

 Secretary may enter into a contract to pay, and pay, holders of 

 the obligation, for and on behalf of the borrower, from funds 

 appropriated for that purpose, the principal and interest 

 payments which become due and payable on the unpaid balance of 

 the obligation if the Secretary finds that--

 (A)(i) the borrower is unable to meet the payments 

 and is not in default;

 (ii) it is in the public interest to permit the 

 borrower to continue to pursue the purposes of the 

 project; and

 (iii) the probable net benefit to the Federal 

 Government in paying the principal and interest will be 

 greater than that which would result in the event of a 

 default;

 (B) the amount of the payment that the Secretary is 

 authorized to pay shall be no greater than the amount of 

 principal and interest that the borrower is obligated to 

 pay under the agreement being guaranteed; and

 (C) the borrower agrees to reimburse the Secretary 

 for the payment (including interest) on terms and 

 conditions that are satisfactory to the Secretary.

 (4) Action by attorney general.--

 (A) Notification.--If the borrower defaults on an 

 obligation, the Secretary shall notify the Attorney 

 General of the default.

 (B) Recovery.--On notification, the Attorney General 

 shall take such action as is appropriate to recover the 

 unpaid principal and interest due from--

 (i) such assets of the defaulting borrower as 

 are associated with the obligation; or

 (ii) any other security pledged to secure the 

 obligation.

 (h) Fees.--

 (1) In general.--The Secretary shall charge and collect fees 

 for guarantees in amounts the Secretary determines are 

 sufficient to cover applicable administrative expenses.

[[Page 119 STAT. 1120]]

 (2) Availability.--Fees collected under this subsection 

 shall--

 (A) be deposited by the Secretary into the Treasury; 

 and

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 (B) remain available until expended, subject to such 

 other conditions as are contained in annual 

 appropriations Acts.

 (i) Records; Audits.--

 (1) In general.--A recipient of a guarantee shall keep such 

 records and other pertinent documents as the Secretary shall 

 prescribe by regulation, including such records as the Secretary 

 may require to facilitate an effective audit.

 (2) Access.--The Secretary and the Comptroller General of 

 the United States, or their duly authorized representatives, 

 shall have access, for the purpose of audit, to the records and 

 other pertinent documents.

 (j) Full Faith and Credit.--The full faith and credit of the United 

States is pledged to the payment of all guarantees issued under this 

section with respect to principal and interest.

SEC. 1703. <<NOTE: 42 USC 16513.>> ELIGIBLE PROJECTS.

 (a) In General.--The Secretary may make guarantees under this 

section only for projects that--

 (1) avoid, reduce, or sequester air pollutants or 

 anthropogenic emissions of greenhouse gases; and

 (2) employ new or significantly improved technologies as 

 compared to commercial technologies in service in the United 

 States at the time the guarantee is issued.

 (b) Categories.--Projects from the following categories shall be 

eligible for a guarantee under this section:

 (1) Renewable energy systems.

 (2) Advanced fossil energy technology (including coal 

 gasification meeting the criteria in subsection (d)).

 (3) Hydrogen fuel cell technology for residential, 

 industrial, or transportation applications.

 (4) Advanced nuclear energy facilities.

 (5) Carbon capture and sequestration practices and 

 technologies, including agricultural and forestry practices that 

 store and sequester carbon.

 (6) Efficient electrical generation, transmission, and 

 distribution technologies.

 (7) Efficient end-use energy technologies.

 (8) Production facilities for fuel efficient vehicles, 

 including hybrid and advanced diesel vehicles.

 (9) Pollution control equipment.

 (10) Refineries, meaning facilities at which crude oil is 

 refined into gasoline.

 (c) Gasification Projects.--The Secretary may make guarantees for 

the following gasification projects:

 (1) Integrated gasification combined cycle projects.--

 Integrated gasification combined cycle plants meeting the 

 emission levels under subsection (d), including--

 (A) projects for the generation of electricity--

 (i) for which, during the term of the 

 guarantee--

 (I) coal, biomass, petroleum coke, 

 or a combination of coal, biomass, and 

 petroleum coke will

[[Page 119 STAT. 1121]]

 account for at least 65 percent of 

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 annual heat input; and

 (II) electricity will account for at 

 least 65 percent of net useful annual 

 energy output;

 (ii) that have a design that is determined by 

 the Secretary to be capable of accommodating the 

 equipment likely to be necessary to capture the 

 carbon dioxide that would otherwise be emitted in 

 flue gas from the plant;

 (iii) that have an assured revenue stream that 

 covers project capital and operating costs 

 (including servicing all debt obligations covered 

 by the guarantee) that is approved by the 

 Secretary and the relevant State public utility 

 commission; and

 (iv) on which construction commences not later 

 than the date that is 3 years after the date of 

 the issuance of the guarantee;

 (B) a project to produce energy from coal (of not 

 more than 13,000 Btu/lb and mined in the western United 

 States) using appropriate advanced integrated 

 gasification combined cycle technology that minimizes 

 and offers the potential to sequester carbon dioxide 

 emissions and that--

 (i) may include repowering of existing 

 facilities;

 (ii) may be built in stages;

 (iii) shall have a combined output of at least 

 100 megawatts;

 (iv) shall be located in a western State at an 

 altitude greater than 4,000 feet; and

 (v) shall demonstrate the ability to use coal 

 with an energy content of not more than 9,000 Btu/

 lb;

 (C) a project located in a taconite-producing region 

 of the United States that is entitled under the law of 

 the State in which the plant is located to enter into a 

 long-term contract approved by a State public utility 

 commission to sell at least 450 megawatts of output to a 

 utility;

 (D) facilities that--

 (i) generate one or more hydrogen-rich and 

 carbon monoxide-rich product streams from the 

 gasification of coal or coal waste; and

 (ii) use those streams to facilitate the 

 production of ultra clean premium fuels through 

 the Fischer-Tropsch process; and

 (E) a project to produce energy and clean fuels, 

 using appropriate coal liquefaction technology, from 

 Western bituminous or subbituminous coal, that--

 (i) is owned by a State government; and

 (ii) may include tribal and private coal 

 resources.

 (2) Industrial gasification projects.--Facilities that 

 gasify coal, biomass, or petroleum coke in any combination to 

 produce synthesis gas for use as a fuel or feedstock and for 

 which electricity accounts for less than 65 percent of the 

 useful energy output of the facility.

 (3) Petroleum coke <<NOTE: Loans.>> gasification projects.--

 The Secretary is encouraged to make loan guarantees under this 

 title available for petroleum coke gasification projects.

[[Page 119 STAT. 1122]]

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 (4) Liquefaction project.--Notwithstanding any other 

 provision of law, funds awarded under the clean coal power 

 initiative under subtitle A of title IV for coal-to-oil 

 liquefaction projects may be used to finance the cost of loan 

 guarantees for projects awarded such funds.

 (d) Emission Levels.--In addition to any other applicable Federal or 

State emission limitation requirements, a project shall attain at 

least--

 (1) total sulfur dioxide emissions in flue gas from the 

 project that do not exceed 0.05 lb/MMBtu;

 (2) a 90-percent removal rate (including any fuel 

 pretreatment) of mercury from the coal-derived gas, and any 

 other fuel, combusted by the project;

 (3) total nitrogen oxide emissions in the flue gas from the 

 project that do not exceed 0.08 lb/MMBtu; and

 (4) total particulate emissions in the flue gas from the 

 project that do not exceed 0.01 lb/MMBtu.

 (e) Qualification of Facilities Receiving Tax Credits.--A project 

that receives tax credits for clean coal technology shall not be 

disqualified from receiving a guarantee under this title.

SEC. 1704. <<NOTE: 42 USC 16514.>> AUTHORIZATION OF APPROPRIATIONS.

 (a) In General.--There are authorized to be appropriated such sums 

as are necessary to provide the cost of guarantees under this title.

 (b) Use of Other Appropriated Funds.--The Department may use amounts 

awarded under the clean coal power initiative under subtitle A of title 

IV to carry out the project described in section 1703(c)(1)(C), on the 

request of the recipient of such award, for a loan guarantee, to the 

extent that the amounts have not yet been disbursed to, or have been 

repaid by, the recipient.

 TITLE XVIII--STUDIES

SEC. 1801. STUDY ON INVENTORY OF PETROLEUM AND NATURAL GAS STORAGE.

 (a) Definition.--For purposes of this section ``petroleum'' means 

crude oil, motor gasoline, jet fuel, distillates, and propane.

 (b) Study.--The Secretary shall conduct a study on petroleum and 

natural gas storage capacity and operational inventory levels, 

nationwide and by major geographical regions.

 (c) Contents.--The study shall address--

 (1) historical normal ranges for petroleum and natural gas 

 inventory levels;

 (2) historical and projected storage capacity trends;

 (3) estimated operation inventory levels below which 

 outages, delivery slowdown, rationing, interruptions in service, 

 or other indicators of shortage begin to appear;

 (4) explanations for inventory levels dropping below normal 

 ranges; and

 (5) the ability of industry to meet United States demand for 

 petroleum and natural gas without shortages or price spikes, 

 when inventory levels are below normal ranges.

 (d) Report to Congress.--Not later than 1 year after the date of 

enactment of this Act, the Secretary shall submit a report

[[Page 119 STAT. 1123]]

to Congress on the results of the study, including findings and any 

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recommendations for preventing future supply shortages.

SEC. 1802. <<NOTE: Deadline.>> STUDY OF ENERGY EFFICIENCY STANDARDS.

 The Secretary shall contract with the National Academy of Sciences 

for a study, to be completed within 1 year after the date of enactment 

of this Act, to examine whether the goals of energy efficiency standards 

are best served by measurement of energy consumed, and efficiency 

improvements, at the actual site of energy consumption, or through the 

full fuel cycle, beginning at the source of energy 

production. <<NOTE: Reports.>> The Secretary shall submit the report to 

Congress.

SEC. 1803. TELECOMMUTING STUDY.

 (a) Study Required.--The Secretary, in consultation with the 

Commission, the Director of the Office of Personnel Management, the 

Administrator of General Services, and the Administrator of NTIA, shall 

conduct a study of the energy conservation implications of the 

widespread adoption of telecommuting by Federal employees in the United 

States.

 (b) Required Subjects of Study.--The study required by subsection 

(a) shall analyze the following subjects in relation to the energy 

saving potential of telecommuting by Federal employees:

 (1) Reductions of energy use and energy costs in commuting 

 and regular office heating, cooling, and other operations.

 (2) Other energy reductions accomplished by telecommuting.

 (3) Existing regulatory barriers that hamper telecommuting, 

 including barriers to broadband telecommunications services 

 deployment.

 (4) Collateral benefits to the environment, family life, and 

 other values.

 (c) Report Required.--The Secretary shall submit to the President 

and Congress a report on the study required by this section not later 

than 6 months after the date of enactment of this Act. Such report shall 

include a description of the results of the analysis of each of the 

subjects described in subsection (b).

 (d) Definitions.--As used in this section:

 (1) Commission.--The term ``Commission'' means the Federal 

 Communications Commission.

 (2) NTIA.--The term ``NTIA'' means the National 

 Telecommunications and Information Administration of the 

 Department of Commerce.

 (3) Telecommuting.--The term ``telecommuting'' means the 

 performance of work functions using communications technologies, 

 thereby eliminating or substantially reducing the need to 

 commute to and from traditional worksites.

 (4) Federal employee.--The term ``Federal employee'' has the 

 meaning provided the term ``employee'' by section 2105 of title 

 5, United States Code.

SEC. 1804. LIHEAP REPORT.

 Not later than 1 year after the date of enactment of this Act, the 

Secretary of Health and Human Services shall transmit to Congress a 

report on how the Low-Income Home Energy Assistance Program could be 

used more effectively to prevent loss of

[[Page 119 STAT. 1124]]

life from extreme temperatures. In preparing such report, the Secretary 

shall consult with appropriate officials in all 50 States and the 

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District of Columbia.

SEC. 1805. OIL BYPASS FILTRATION TECHNOLOGY.

 The Secretary and the Administrator of the Environmental Protection 

Agency shall--

 (1) conduct a joint study of the benefits of oil bypass 

 filtration technology in reducing demand for oil and protecting 

 the environment;

 (2) examine the feasibility of using oil bypass filtration 

 technology in Federal motor vehicle fleets; and

 (3) include in such study, prior to any determination of the 

 feasibility of using oil bypass filtration technology, the 

 evaluation of products and various manufacturers.

SEC. 1806. TOTAL INTEGRATED THERMAL SYSTEMS.

 The Secretary shall--

 (1) conduct a study of the benefits of total integrated 

 thermal systems in reducing demand for oil and protecting the 

 environment; and

 (2) examine the feasibility of using total integrated 

 thermal systems in Department of Defense and other Federal motor 

 vehicle fleets.

SEC. 1807. <<NOTE: 42 USC 16521.>> REPORT ON ENERGY INTEGRATION WITH 

 LATIN AMERICA.

 The Secretary shall submit an annual report to the Committee on 

Energy and Commerce of the United States House of Representatives and to 

the Committee on Energy and Natural Resources of the Senate concerning 

the status of energy export development in Latin America and efforts by 

the Secretary and other departments and agencies of the United States to 

promote energy integration with Latin America. <<NOTE: Mexico.>> The 

report shall contain a detailed analysis of the status of energy export 

development in Mexico and a description of all significant efforts by 

the Secretary and other departments and agencies to promote a 

constructive relationship with Mexico regarding the development of that 

nation's energy capacity. In particular this report shall outline 

efforts the Secretary and other departments and agencies have made to 

ensure that regulatory approval and oversight of United States/Mexico 

border projects that result in the expansion of Mexican energy capacity 

are effectively coordinated across departments and with the Mexican 

government.

SEC. 1808. <<NOTE: 42 USC 16522.>> LOW-VOLUME GAS RESERVOIR STUDY.

 (a) Study.--The <<NOTE: Grants.>> Secretary shall make a grant to an 

organization of oil and gas producing States, specifically those 

containing significant numbers of marginal oil and natural gas wells, 

for conducting an annual study of low-volume natural gas reservoirs. 

Such organization shall work with the State geologist of each State 

being studied.

 (b) Contents.--The studies under this section shall--

 (1) determine the status and location of marginal wells and 

 gas reservoirs;

 (2) gather the production information of these marginal 

 wells and reservoirs;

 (3) estimate the remaining producible reserves based on 

 variable pipeline pressures;

[[Page 119 STAT. 1125]]

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 (4) locate low-pressure gathering facilities and pipelines;

 (5) recommend incentives which will enable the continued 

 production of these resources;

 (6) produce maps and literature to disseminate to States to 

 promote conservation of natural gas reserves; and

 (7) evaluate the amount of natural gas that is being wasted 

 through the practice of venting or flaring of natural gas 

 produced in association with crude oil well production.

 (c) Data Analysis.--Data development and analysis under this section 

shall be performed by an institution of higher education with GIS 

capabilities. If the organization receiving the grant under subsection 

(a) does not have GIS capabilities, such organization shall contract 

with one or more entities with--

 (1) technological capabilities and resources to perform 

 advanced image processing, GIS programming, and data analysis; 

 and

 (2) the ability to--

 (A) process remotely sensed imagery with high 

 spatial resolution;

 (B) deploy global positioning systems;

 (C) process and synthesize existing, variable-format 

 gas well, pipeline, gathering facility, and reservoir 

 data;

 (D) create and query GIS databases with 

 infrastructure location and attribute information;

 (E) write computer programs to customize relevant 

 GIS software;

 (F) generate maps, charts, and graphs which 

 summarize findings from data research for presentation 

 to different audiences; and

 (G) deliver data in a variety of formats, including 

 Internet Map Server for query and display, desktop 

 computer display, and access through handheld personal 

 digital assistants.

 (d) Authorization of Appropriations.--There are authorized to be 

appropriated to the Secretary for carrying out this section--

 (1) $1,500,000 for fiscal year 2006; and

 (2) $450,000 for each of the fiscal years 2007 through 2010.

 (e) Definitions.--For purposes of this section, the term ``GIS'' 

means geographic information systems technology that facilitates the 

organization and management of data with a geographic component.

SEC. 1809. INVESTIGATION OF GASOLINE PRICES.

 (a) Investigation.--Not <<NOTE: Deadline.>> later than 90 days after 

the date of enactment of this Act, the Federal Trade Commission shall 

conduct an investigation to determine if the price of gasoline is being 

artificially manipulated by reducing refinery capacity or by any other 

form of market manipulation or price gouging practices.

 (b) Evaluation and Analysis.--The Secretary shall direct the 

National Petroleum Council to conduct an evaluation and analysis to 

determine whether, and to what extent, environmental and other 

regulations affect new domestic refinery construction and significant 

expansion of existing refinery capacity.

 (c) Reports to Congress.--

[[Page 119 STAT. 1126]]

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 (1) Investigation.--On completion of the investigation under 

 subsection (a), the Federal Trade Commission shall submit to 

 Congress a report that describes--

 (A) the results of the investigation; and

 (B) any recommendations of the Federal Trade 

 Commission.

 (2) Evaluation and analysis.--On completion of the 

 evaluation and analysis under subsection (b), the Secretary 

 shall submit to Congress a report that describes--

 (A) the results of the evaluation and analysis; and

 (B) any recommendations of the National Petroleum 

 Council.

SEC. 1810. <<NOTE: Reports. Deadlines. 42 USC 16523.>> ALASKA NATURAL 

 GAS PIPELINE.

 Not later than 180 days after the date of enactment of this Act, and 

every 180 days thereafter until the Alaska natural gas pipeline 

commences operation, the Federal Energy Regulatory Commission shall 

submit to Congress a report describing--

 (1) the progress made in licensing and constructing the 

 pipeline; and

 (2) any issue impeding that progress.

SEC. 1811. <<NOTE: State listing.>> COAL BED METHANE STUDY.

 (a) Study.--

 (1) In general.--The <<NOTE: Contracts.>> Secretary of the 

 Interior, in consultation with the Administrator of the 

 Environmental Protection Agency, shall enter into an arrangement 

 under which the National Academy of Sciences shall conduct a 

 study on the effect of coal bed natural gas production on 

 surface and ground water resources, including ground water 

 aquifiers, in the States of Montana, Wyoming, Colorado, New 

 Mexico, North Dakota, and Utah.

 (2) Matters to be addressed.--The study shall address the 

 effectiveness of--

 (A) the management of coal bed methane produced 

 water;

 (B) the use of best management practices; and

 (C) various production techniques for coal bed 

 methane natural gas in minimizing impacts on water 

 resources.

 (b) Data Analysis.--The study shall analyze available hydrologic, 

geologic and water quality data, along with--

 (1) production techniques, produced water management 

 techniques, best management practices, and other factors that 

 can mitigate effects of coal bed methane development;

 (2) the costs associated with mitigation techniques;

 (3) effects on surface or ground water resources, including 

 drinking water, associated with surface or subsurface disposal 

 of waters produced during extraction of coal bed methane; and

 (4) any other significant effects on surface or ground water 

 resources associated with production of coal bed methane.

 (c) Recommendations.--The study shall analyze the effectiveness of 

current mitigation practices of coal bed methane produced water handling 

in relation to existing Federal and State laws and regulations, and make 

recommendations as to changes, if any, to Federal law necessary to 

address adverse impacts to surface or ground water resources associated 

with coal bed methane development.

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[[Page 119 STAT. 1127]]

 (d) Completion of Study.--The <<NOTE: Public information.>> National 

Academy of Sciences shall submit the findings and recommendations of the 

study to the Secretary of the Interior and the Administrator of the 

Environmental Protection Agency within 12 months after the date of 

enactment of this Act, and shall upon completion make the results of the 

study available to the public.

 (e) Report to Congress.--The Secretary of the Interior and the 

Administrator of the Environmental Protection Agency, after consulting 

with States, shall report to the Congress within 6 months after 

receiving the results of the study on--

 (1) the findings and recommendations of the study;

 (2) the agreement or disagreement of the Secretary of the 

 Interior and the Administrator of the Environmental Protection 

 Agency with each of its findings and recommendations; and

 (3) any recommended changes in funding to address the 

 effects of coal bed methane production on surface and ground 

 water resources.

SEC. 1812. BACKUP FUEL CAPABILITY STUDY.

 (a) Study.--

 (1) In general.--The Secretary shall conduct a study of the 

 effect of obtaining and maintaining liquid and other fuel backup 

 capability at--

 (A) gas-fired power generation facilities; and

 (B) other gas-fired industrial facilities.

 (2) Contents.--The study under paragraph (1) shall address--

 (A) the costs and benefits of adding a different 

 fuel capability to a power gas-fired power generating or 

 industrial facility, taking into consideration regional 

 differences;

 (B) methods of the Federal Government and State 

 governments to encourage gas-fired power generators and 

 industries to develop the capability to power the 

 facilities using a backup fuel;

 (C) the effect on the supply and cost of natural gas 

 of--

 (i) a balanced portfolio of fuel choices in 

 power generation and industrial applications; and

 (ii) State regulations that permit agencies in 

 the State to carry out policies that encourage the 

 use of other backup fuels in gas-fired power 

 generation; and

 (D) changes required in the Clean Air Act (42 U.S.C. 

 7401 et seq.) to allow natural gas generators to add 

 clean backup fuel capabilities.

 (b) Report to Congress.--Not later than 1 year after the date of 

enactment of this Act, the Secretary shall submit to Congress a report 

on the results of the study under subsection (a), including 

recommendations regarding future activity of the Federal Government 

relating to backup fuel capability.

SEC. 1813. INDIAN LAND RIGHTS-OF-WAY.

 (a) Study.--

 (1) In general.--The Secretary and the Secretary of the 

 Interior (referred to in this section as the ``Secretaries'') 

 shall jointly conduct a study of issues regarding energy rights-

 of-way on tribal land (as defined in section 2601 of the Energy 

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 Policy Act of 1992 (as amended by section 503)) (referred to in 

 this section as ``tribal land'').

[[Page 119 STAT. 1128]]

 (2) Consultation.--In conducting the study under paragraph 

 (1), the Secretaries shall consult with Indian tribes, the 

 energy industry, appropriate governmental entities, and affected 

 businesses and consumers.

 (b) Report.--Not later than 1 year after the date of enactment of 

this Act, the Secretaries shall submit to Congress a report on the 

findings of the study, including--

 (1) an analysis of historic rates of compensation paid for 

 energy rights-of-way on tribal land;

 (2) recommendations for appropriate standards and procedures 

 for determining fair and appropriate compensation to Indian 

 tribes for grants, expansions, and renewals of energy rights-of-

 way on tribal land;

 (3) an assessment of the tribal self-determination and 

 sovereignty interests implicated by applications for the grant, 

 expansion, or renewal of energy rights-of-way on tribal land; 

 and

 (4) an analysis of relevant national energy transportation 

 policies relating to grants, expansions, and renewals of energy 

 rights-of-way on tribal land.

SEC. 1814. <<NOTE: Reports. Deadline.>> MOBILITY OF SCIENTIFIC AND 

 TECHNICAL PERSONNEL.

 Not later than 2 years after the date of enactment of this section, 

the Secretary shall transmit to Congress a report that--

 (1) identifies any policies or procedures of a contractor 

 operating a National Laboratory or single-purpose research 

 facility that create disincentives to the temporary or permanent 

 transfer of scientific and technical personnel among the 

 contractor-operated National Laboratories or contractor-operated 

 single-purpose research facilities; and

 (2) provides recommendations for improving interlaboratory 

 exchange of scientific and technical personnel.

SEC. 1815. INTERAGENCY REVIEW OF COMPETITION IN THE WHOLESALE AND RETAIL 

 MARKETS FOR ELECTRIC ENERGY.

 (a) Task Force.--There is <<NOTE: Establishment.>> established an 

inter-agency task force, to be known as the ``Electric Energy Market 

Competition Task Force'' (referred to in this section as the ``task 

force''), consisting of five members--

 (1) one of whom shall be an employee of the Department of 

 Justice, to be appointed by the Attorney General of the United 

 States;

 (2) one of whom shall be an employee of the Federal Energy 

 Regulatory Commission, to be appointed by the Chairperson of 

 that Commission;

 (3) one of whom shall be an employee of the Federal Trade 

 Commission, to be appointed by the Chairperson of that 

 Commission;

 (4) one of whom shall be an employee of the Department, to 

 be appointed by the Secretary; and

 (5) one of whom shall be an employee of the Rural Utilities 

 Service, to be appointed by the Secretary of Agriculture.

 (b) Study and Report.--

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 (1) Study.--The task force shall conduct a study and 

 analysis of competition within the wholesale and retail market 

 for electric energy in the United States.

 (2) Report.--

[[Page 119 STAT. 1129]]

 (A) Final report.--Not later than 1 year after the 

 date of enactment of this Act, the task force shall 

 submit to Congress a final report on the findings of the 

 task force under paragraph (1).

 (B) Public comment.--Not later than the date that is 

 60 days before a final report is submitted to Congress 

 under subparagraph (A), the task force shall--

 (i) <<NOTE: Federal 

 Register, publication.>> publish in the Federal 

 Register a draft of the report; and

 (ii) provide an opportunity for public comment 

 on the report.

 (c) Consultation.--In conducting the study under subsection (b), the 

task force shall consult with and solicit comments from any advisory 

entity of the task force, the States, representatives of the electric 

power industry, and the public.

SEC. 1816. STUDY OF RAPID ELECTRICAL GRID RESTORATION.

 (a) Study.--

 (1) In general.--The Secretary shall conduct a study of the 

 benefits of using mobile transformers and mobile substations to 

 rapidly restore electrical service to areas subjected to 

 blackouts as a result of--

 (A) equipment failure;

 (B) natural disasters;

 (C) acts of terrorism; or

 (D) war.

 (2) Contents.--The study under paragraph (1) shall contain 

 an analysis of--

 (A) the feasibility of using mobile transformers and 

 mobile substations to reduce dependence on foreign 

 entities for key elements of the electrical grid system 

 of the United States;

 (B) the feasibility of using mobile transformers and 

 mobile substations to rapidly restore electrical power 

 to--

 (i) military bases;

 (ii) the Federal Government;

 (iii) communications industries;

 (iv) first responders; and

 (v) other critical infrastructures, as 

 determined by the Secretary;

 (C) the quantity of mobile transformers and mobile 

 substations necessary--

 (i) to eliminate dependence on foreign sources 

 for key electrical grid components in the United 

 States;

 (ii) to rapidly deploy technology to fully 

 restore full electrical service to prioritized 

 Governmental functions; and

 (iii) to identify manufacturing sources in 

 existence on the date of enactment of this Act 

 that have previously manufactured specialized 

 mobile transformer or mobile substation products 

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 for Federal agencies.

 (b) Report.--

 (1) In general.--Not later than 1 year after the date of 

 enactment of this Act, the Secretary shall submit to the 

 President and Congress a report on the study under subsection 

 (a).

[[Page 119 STAT. 1130]]

 (2) Inclusion.--The report shall include a description of 

 the results of the analysis under subsection (a)(2).

SEC. 1817. STUDY OF DISTRIBUTED GENERATION.

 (a) Study.--

 (1) In general.--

 (A) Potential benefits.--The Secretary, in 

 consultation with the Federal Energy Regulatory 

 Commission, shall conduct a study of the potential 

 benefits of cogeneration and small power production.

 (B) Recipients.--The benefits described in 

 subparagraph (A) include benefits that are received 

 directly or indirectly by--

 (i) an electricity distribution or 

 transmission service provider;

 (ii) other customers served by an electricity 

 distribution or transmission service provider; and

 (iii) the general public in the area served by 

 the public utility in which the cogenerator or 

 small power producer is located.

 (2) Inclusions.--The study shall include an analysis of--

 (A) the potential benefits of--

 (i) increased system reliability;

 (ii) improved power quality;

 (iii) the provision of ancillary services;

 (iv) reduction of peak power requirements 

 through onsite generation;

 (v) the provision of reactive power or volt-

 ampere reactives;

 (vi) an emergency supply of power;

 (vii) offsets to investments in generation, 

 transmission, or distribution facilities that 

 would otherwise be recovered through rates;

 (viii) diminished land use effects and right-

 of-way acquisition costs; and

 (ix) reducing the vulnerability of a system to 

 terrorism; and

 (B) any rate-related issue that may impede or 

 otherwise discourage the expansion of cogeneration and 

 small power production facilities, including a review of 

 whether rates, rules, or other requirements imposed on 

 the facilities are comparable to rates imposed on 

 customers of the same class that do not have 

 cogeneration or small power production.

 (3) Valuation of benefits.--In carrying out the study, the 

 Secretary shall determine an appropriate method of valuing 

 potential benefits under varying circumstances for individual 

 cogeneration or small power production units.

 (b) Report.--Not later than 18 months after the date of enactment of 

this Act, the Secretary shall--

 (1) complete the study;

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 (2) <<NOTE: Public information.>> provide an opportunity for 

 public comment on the results of the study; and

 (3) submit to the President and Congress a report 

 describing--

 (A) the results of the study; and

[[Page 119 STAT. 1131]]

 (B) information relating to the public comments 

 received under paragraph (2).

 (c) Publication.--After submission of the report under subsection 

(b) to the President and Congress, the Secretary shall publish the 

report.

SEC. 1818. NATURAL GAS SUPPLY SHORTAGE REPORT.

 (a) In General.--Not later than 180 days after the date of enactment 

of this Act, the Secretary shall submit to Congress a report on natural 

gas supplies and demand.

 (b) Purpose.--The purpose of the report under subsection (a) is to 

develop recommendations for achieving a balance between natural gas 

supply and demand in order to--

 (1) provide residential consumers with natural gas at 

 reasonable and stable prices;

 (2) accommodate long-term maintenance and growth of domestic 

 natural gas-dependent industrial, manufacturing, and commercial 

 enterprises;

 (3) facilitate the attainment of national ambient air 

 quality standards under the Clean Air Act (43 U.S.C. 7401 et 

 seq.);

 (4) achieve continued progress in reducing the emissions 

 associated with electric power generation; and

 (5) support the development of the preliminary phases of 

 hydrogen-based energy technologies.

 (c) Comprehensive Analysis.--The report shall include a 

comprehensive analysis of, for the period beginning on January 1, 2004, 

and ending on December 31, 2015, natural gas supply and demand in the 

United States, including--

 (1) estimates of annual domestic demand for natural gas, 

 taking into consideration the effect of Federal policies and 

 actions that are likely to increase or decrease the demand for 

 natural gas;

 (2) projections of annual natural gas supplies, from 

 domestic and foreign sources, under Federal policies in 

 existence on the date of enactment of this Act;

 (3) an identification of estimated natural gas supplies that 

 are not available under those Federal policies;

 (4) scenarios for decreasing natural gas demand and 

 increasing natural gas supplies that compare the relative 

 economic and environmental impacts of Federal policies that--

 (A) encourage or require the use of natural gas to 

 meet air quality, carbon dioxide emission reduction, or 

 energy security goals;

 (B) encourage or require the use of energy sources 

 other than natural gas, including coal, nuclear, and 

 renewable sources;

 (C) support technologies to develop alternative 

 sources of natural gas and synthetic gas, including coal 

 gasification technologies;

 (D) encourage or require the use of energy 

 conservation and demand side management practices; and

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 (E) affect access to domestic natural gas supplies; 

 and

 (5) recommendations for Federal actions to achieve the 

 purposes described in subsection (b), including recommendations 

 that--

[[Page 119 STAT. 1132]]

 (A) encourage or require the use of energy sources 

 other than natural gas, including coal, nuclear, and 

 renewable sources;

 (B) encourage or require the use of energy 

 conservation or demand side management practices;

 (C) support technologies for the development of 

 alternative sources of natural gas and synthetic gas, 

 including coal gasification technologies; and

 (D) would improve access to domestic natural gas 

 supplies.

 (d) Consultation.--In preparing the report under subsection (a), the 

Secretary shall consult with--

 (1) experts in natural gas supply and demand; and

 (2) representatives of--

 (A) State and local governments;

 (B) tribal organizations; and

 (C) consumer and other organizations.

 (e) Hearings.--In preparing the report under subsection (a), the 

Secretary may hold public hearings and provide other opportunities for 

public comment, as the Secretary considers appropriate.

SEC. 1819. <<NOTE: Reports. Deadline.>> HYDROGEN PARTICIPATION STUDY.

 Not later than 1 year after the date of enactment of this Act, the 

Secretary shall submit to Congress a report evaluating methodologies to 

ensure the widest participation practicable in setting goals and 

milestones under the hydrogen program of the Department, including 

international participants.

SEC. 1820. OVERALL EMPLOYMENT IN A HYDROGEN ECONOMY.

 (a) Study.--

 (1) In general.--The Secretary shall carry out a study of 

 the likely effects of a transition to a hydrogen economy on 

 overall employment in the United States.

 (2) Contents.--In completing the study, the Secretary shall 

 take into consideration--

 (A) the replacement effects of new goods and 

 services;

 (B) international competition;

 (C) workforce training requirements;

 (D) multiple possible fuel cycles, including usage 

 of raw materials;

 (E) rates of market penetration of technologies; and

 (F) regional variations based on geography.

 (b) Report.--Not later than 18 months after the date of enactment of 

this Act, the Secretary shall submit to Congress a report describing the 

findings, conclusions, and recommendations of the study under subsection 

(a).

SEC. 1821. STUDY OF BEST MANAGEMENT PRACTICES FOR ENERGY RESEARCH AND 

 DEVELOPMENT PROGRAMS.

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 (a) In General.--The Secretary shall enter into an arrangement with 

the National Academy of Public Administration under which the Academy 

shall conduct a study to assess management practices for research, 

development, and demonstration programs at the Department.

 (b) Scope of the Study.--The study shall consider--

 (1) management practices that act as barriers between the 

 Office of Science and offices conducting mission-oriented 

 research;

[[Page 119 STAT. 1133]]

 (2) recommendations for management practices that would 

 improve coordination and bridge the innovation gap between the 

 Office of Science and offices conducting mission-oriented 

 research;

 (3) the applicability of the management practices used by 

 the Department of Defense Advanced Research Projects Agency to 

 research programs at the Department;

 (4) the advisability of creating an agency within the 

 Department modeled after the Department of Defense Advanced 

 Research Projects Agency;

 (5) recommendations for management practices that could best 

 encourage innovative research and efficiency at the Department; 

 and

 (6) any other relevant considerations.

 (c) Report.--Not later than 18 months after the date of enactment of 

this Act, the Secretary shall submit to Congress a report on the study 

conducted under this section.

SEC. 1822. <<NOTE: Contracts. Deadline.>> EFFECT OF ELECTRICAL 

 CONTAMINANTS ON RELIABILITY OF ENERGY PRODUCTION SYSTEMS.

 Not later than 180 days after the date of enactment of this Act, the 

Secretary shall enter into a contract with the National Academy of 

Sciences under which the National Academy of Sciences shall determine 

the effect that electrical contaminants (such as tin whiskers) may have 

on the reliability of energy production systems, including nuclear 

energy.

SEC. 1823. ALTERNATIVE FUELS REPORTS.

 (a) In General.--Not later than 1 year after the date of enactment 

of this Act, the Secretary shall submit to Congress reports on the 

potential for each of biodiesel and hythane to become major, 

sustainable, alternative fuels.

 (b) Biodiesel Report.--The report relating to biodiesel submitted 

under subsection (a) shall--

 (1) provide a detailed assessment of--

 (A) potential biodiesel markets and manufacturing 

 capacity; and

 (B) environmental and energy security benefits with 

 respect to the use of biodiesel;

 (2) identify any impediments, especially in infrastructure 

 needed for production, distribution, and storage, to biodiesel 

 becoming a substantial source of fuel for conventional diesel 

 and heating oil applications;

 (3) identify strategies to enhance the commercial deployment 

 of biodiesel; and

 (4) include an examination and recommendations, as 

 appropriate, of the ways in which biodiesel may be modified to 

 be a cleaner-burning fuel.

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 (c) Hythane Report.--The report relating to hythane submitted under 

subsection (a) shall--

 (1) provide a detailed assessment of potential hythane 

 markets and the research and development activities that are 

 necessary to facilitate the commercialization of hythane as a 

 competitive, environmentally friendly transportation fuel;

 (2) address--

 (A) the infrastructure necessary to produce, blend, 

 distribute, and store hythane for widespread commercial 

 purposes; and

[[Page 119 STAT. 1134]]

 (B) other potential market barriers to the 

 commercialization of hythane;

 (3) examine the viability of producing hydrogen using 

 energy-efficient, environmentally friendly methods so that the 

 hydrogen can be blended with natural gas to produce hythane; and

 (4) include an assessment of the modifications that would be 

 required to convert compressed natural gas vehicle engines to 

 engines that use hythane as fuel.

 (d) Grants for Report Completion.--The Secretary may use such sums 

as are available to the Secretary to provide, to one or more colleges or 

universities selected by the Secretary, grants for use in carrying out 

research to assist the Secretary in preparing the reports required to be 

submitted under subsection (a).

SEC. 1824. FINAL ACTION ON REFUNDS FOR EXCESSIVE CHARGES.

 The Federal Energy Regulatory Commission (FERC) shall--

 (1) seek to conclude its investigation into the unjust or 

 unreasonable charges incurred by California during the 2000-2001 

 electricity crisis as soon as possible;

 (2) <<NOTE: California.>> seek to ensure that refunds the 

 Commission determines are owed to the State of California are 

 paid to the State of California; and

 (3) <<NOTE: Reports. Deadline.>> submit to Congress a report 

 by December 31, 2005, describing the actions taken by the 

 Commission to date under this section and timetables for further 

 actions.

SEC. 1825. FUEL CELL AND HYDROGEN TECHNOLOGY STUDY.

 (a) In General.--As <<NOTE: Contracts.>> soon as practicable after 

the date of enactment of this Act, the Secretary shall enter into a 

contract with the National Academy of Sciences and the National Research 

Council to carry out a study of fuel cell technologies that provides a 

budget roadmap for the development of fuel cell technologies and the 

transition from petroleum to hydrogen in a significant percentage of the 

vehicles sold by 2020.

 (b) Requirements.--In carrying out the study, the National Academy 

of Sciences and the National Research Council shall--

 (1) establish as a goal the maximum percentage practicable 

 of vehicles that the National Academy of Sciences and the 

 National Research Council determines can be fueled by hydrogen 

 by 2020;

 (2) determine the amount of Federal and private funding 

 required to meet the goal established under paragraph (1);

 (3) determine what actions are required to meet the goal 

 established under paragraph (1);

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 (4) examine the need for expanded and enhanced Federal 

 research and development programs, changes in regulations, grant 

 programs, partnerships between the Federal Government and 

 industry, private sector investments, infrastructure investments 

 by the Federal Government and industry, educational and public 

 information initiatives, and Federal and State tax incentives to 

 meet the goal established under paragraph (1);

 (5) consider whether other technologies would be less 

 expensive or could be more quickly implemented than fuel cell 

 technologies to achieve significant reductions in carbon dioxide 

 emissions;

 (6) take into account any reports relating to fuel cell 

 technologies and hydrogen-fueled vehicles, including--

[[Page 119 STAT. 1135]]

 (A) the report prepared by the National Academy of 

 Engineering and the National Research Council in 2004 

 entitled ``Hydrogen Economy: Opportunities, Costs, 

 Barriers, and R&D Needs''; and

 (B) the report prepared by the U.S. Fuel Cell 

 Council in 2003 entitled ``Fuel Cells and Hydrogen: The 

 Path Forward'';

 (7) consider the challenges, difficulties, and potential 

 barriers to meeting the goal established under paragraph (1); 

 and

 (8) with respect to the budget roadmap--

 (A) specify the amount of funding required on an 

 annual basis from the Federal Government and industry to 

 carry out the budget roadmap; and

 (B) specify the advantages and disadvantages to 

 moving toward the transition to hydrogen in vehicles in 

 accordance with the timeline established by the budget 

 roadmap.

SEC. 1826. PASSIVE SOLAR TECHNOLOGIES.

 (a) Definition of Passive Solar Technology.--In this section, the 

term ``passive solar technology'' means a passive solar technology, 

including daylighting, that--

 (1) is used exclusively to avoid electricity use; and

 (2) can be metered to determine energy savings.

 (b) Study.--The Secretary shall conduct a study to determine--

 (1) the range of levelized costs of avoided electricity for 

 passive solar technologies;

 (2) the quantity of electricity displaced using passive 

 solar technologies in the United States as of the date of 

 enactment of this Act; and

 (3) the projected energy savings from passive solar 

 technologies in 5, 10, 15, 20, and 25 years after the date of 

 enactment of this Act if--

 (A) incentives comparable to the incentives provided 

 for electricity generation technologies were provided 

 for passive solar technologies; and

 (B) no new incentives for passive solar technologies 

 were provided.

 (c) Report.--Not later than 120 days after the date of enactment of 

this Act, the Secretary shall submit to Congress a report that describes 

the results of the study under subsection (b).

SEC. 1827. STUDY OF LINK BETWEEN ENERGY SECURITY AND INCREASES IN 

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 VEHICLE MILES TRAVELED.

 (a) In General.--The Secretary shall enter into an arrangement with 

the National Academy of Sciences under which the Academy shall conduct a 

study to assess the implications on energy use and efficiency of land 

development patterns in the United States.

 (b) Scope.--The study shall consider--

 (1) the correlation, if any, between land development 

 patterns and increases in vehicle miles traveled;

 (2) whether petroleum use in the transportation sector can 

 be reduced through changes in the design of development 

 patterns;

 (3) the potential benefits of--

[[Page 119 STAT. 1136]]

 (A) information and education programs for State and 

 local officials (including planning officials) on the 

 potential for energy savings through planning, design, 

 development, and infrastructure decisions;

 (B) incorporation of location efficiency models in 

 transportation infrastructure planning and investments; 

 and

 (C) transportation policies and strategies to help 

 transportation planners manage the demand for the number 

 and length of vehicle trips, including trips that 

 increase the viability of other means of travel; and

 (4) such other considerations relating to the study topic as 

 the National Academy of Sciences finds appropriate.

 (c) Report.--Not later than 2 years after the date of enactment of 

this Act, the National Academy of Sciences shall submit to the Secretary 

and Congress a report on the study conducted under this section.

SEC. 1828. SCIENCE STUDY ON CUMULATIVE IMPACTS OF MULTIPLE OFFSHORE 

 LIQUEFIED NATURAL GAS FACILITIES.

 (a) In General.--The Secretary (in consultation with the National 

Oceanic Atmospheric Administration, the Commandant of the Coast Guard, 

affected recreational and commercial fishing industries, and affected 

energy and transportation stakeholders) shall carry out a study and 

compile existing science (including studies and data) to determine the 

risks or benefits presented by cumulative impacts of multiple offshore 

liquefied natural gas facilities reasonably assumed to be constructed in 

an area of the Gulf of Mexico using the open-rack vaporization system.

 (b) Accuracy.--In carrying out subsection (a), the Secretary shall 

verify the accuracy of available science and develop a science-based 

evaluation of significant short-term and long-term cumulative impacts, 

both adverse and beneficial, of multiple offshore liquefied natural gas 

facilities reasonably assumed to be constructed in an area of the Gulf 

of Mexico using or proposing the open-rack vaporization system on the 

fisheries and marine populations in the vicinity of the facility.

SEC. 1829. ENERGY AND WATER SAVING MEASURES IN CONGRESSIONAL BUILDINGS.

 (a) In General.--The Architect of the Capitol, as part of the 

process of updating the Master Plan Study for the Capitol complex, 

shall--

 (1) carry out a study to evaluate the energy infrastructure 

 of the Capitol complex to determine how to augment the 

 infrastructure to become more energy efficient--

 (A) by using unconventional and renewable energy 

 resources;

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 (B) by--

 (i) incorporating new technologies to 

 implement effective green building solutions;

 (ii) adopting computer-based building 

 management systems; and

 (iii) recommending strategies based on end-

 user behavioral changes to implement low-cost 

 environmental gains; and

[[Page 119 STAT. 1137]]

 (C) in a manner that would enable the Capitol 

 complex to have reliable utility service in the event of 

 power fluctuations, shortages, or outages;

 (2) carry out a study to explore the feasibility of 

 installing energy and water conservation measures on the rooftop 

 of the Dirksen Senate Office Building, including the area 

 directly above the food service facilities in the center of the 

 building, including the installation of--

 (A) a vegetative covering area, using native species 

 to the maximum extent practicable, to--

 (i) insulate and increase the energy 

 efficiency of the building;

 (ii) reduce precipitation runoff and conserve 

 water for landscaping or other uses;

 (iii) increase, and provide more efficient use 

 of, available outdoor space through management of 

 the rooftop of the center of the building as a 

 park or garden area for occupants of the building; 

 and

 (iv) improve the aesthetics of the building; 

 and

 (B) onsite renewable energy and other state-of-the-

 art technologies to--

 (i) improve the energy efficiency and energy 

 security of the building or the Capitol complex by 

 providing additional or backup sources of power in 

 the event of a power shortage or other emergency;

 (ii) reduce the use of resources by the 

 building; or

 (iii) enhance worker productivity; and

 (C) <<NOTE: Reports. Deadline.>> not later than 180 

 days after the date of enactment of this Act, submit to 

 Congress a report describing the findings and 

 recommendations of the study under subparagraph (B).

 (b) Authorization of Appropriations.--There is authorized to be 

appropriated to the Architect of the Capitol to carry out this section 

$2,000,000 for each of fiscal years 2006 through 2010.

SEC. 1830. STUDY OF AVAILABILITY OF SKILLED WORKERS.

 (a) In General.--The Secretary shall enter into an arrangement with 

the National Academy of Sciences under which the National Academy of 

Sciences shall conduct a study of the short-term and long-term 

availability of skilled workers to meet the energy and mineral security 

requirements of the United States.

 (b) Inclusions.--The study shall include an analysis of--

 (1) the need for and availability of workers for the oil, 

 gas, and mineral industries;

 (2) the availability of skilled labor at both entry level 

 and more senior levels; and

 (3) recommendations for future actions needed to meet future 

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 labor requirements.

 (c) Report.--Not later than 2 years after the date of enactment of 

this Act, the Secretary shall submit to Congress a report that describes 

the results of the study.

SEC. 1831. REVIEW OF ENERGY POLICY ACT OF 1992 PROGRAMS.

 (a) In General.--Not <<NOTE: Deadline.>> later than 180 days after 

the date of enactment of this section, the Secretary shall complete a 

study to determine the effect that titles III, IV, and V of the Energy 

Policy Act of 1992 (42 U.S.C. 13211 et seq.) have had on--

[[Page 119 STAT. 1138]]

 (1) the development of alternative fueled vehicle 

 technology;

 (2) the availability of that technology in the market; and

 (3) the cost of alternative fueled vehicles.

 (b) Topics.--As part of the study under subsection (a), the 

Secretary shall specifically identify--

 (1) the number of alternative fueled vehicles acquired by 

 fleets or covered persons required to acquire alternative fueled 

 vehicles;

 (2) the quantity, by type, of alternative fuel actually used 

 in alternative fueled vehicles acquired by fleets or covered 

 persons;

 (3) the quantity of petroleum displaced by the use of 

 alternative fuels in alternative fueled vehicles acquired by 

 fleets or covered persons;

 (4) the direct and indirect costs of compliance with 

 requirements under titles III, IV, and V of the Energy Policy 

 Act of 1992 (42 U.S.C. 13211 et seq.), including--

 (A) vehicle acquisition requirements imposed on 

 fleets or covered persons;

 (B) administrative and recordkeeping expenses;

 (C) fuel and fuel infrastructure costs;

 (D) associated training and employee expenses; and

 (E) any other factors or expenses the Secretary 

 determines to be necessary to compile reliable estimates 

 of the overall costs and benefits of complying with 

 programs under those titles for fleets, covered persons, 

 and the national economy;

 (5) the existence of obstacles preventing compliance with 

 vehicle acquisition requirements and increased use of 

 alternative fuel in alternative fueled vehicles acquired by 

 fleets or covered persons; and

 (6) the projected impact of amendments to the Energy Policy 

 Act of 1992 made by this title.

 (c) Report.--Upon completion of the study under this section, the 

Secretary shall submit to Congress a report that describes the results 

of the study and includes any recommendations of the Secretary for 

legislative or administrative changes concerning the alternative fueled 

vehicle requirements under titles III, IV and V of the Energy Policy Act 

of 1992 (42 U.S.C. 13211 et seq.).

SEC. 1832. <<NOTE: 42 USC 16524.>> STUDY ON THE BENEFITS OF ECONOMIC 

 DISPATCH.

 (a) Study.--The Secretary, in coordination and consultation with the 

States, shall conduct a study on--

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 (1) the procedures currently used by electric utilities to 

 perform economic dispatch;

 (2) identifying possible revisions to those procedures to 

 improve the ability of nonutility generation resources to offer 

 their output for sale for the purpose of inclusion in economic 

 dispatch; and

 (3) the potential benefits to residential, commercial, and 

 industrial electricity consumers nationally and in each state if 

 economic dispatch procedures were revised to improve the ability 

 of nonutility generation resources to offer their output for 

 inclusion in economic dispatch.

 (b) Definition.--The term ``economic dispatch'' when used in this 

section means the operation of generation facilities to produce

[[Page 119 STAT. 1139]]

energy at the lowest cost to reliably serve consumers, recognizing any 

operational limits of generation and transmission facilities.

 (c) Report to Congress and the States.--Not later than 90 days after 

the date of enactment of this Act, and on a yearly basis following, the 

Secretary shall submit a report to Congress and the States on the 

results of the study conducted under subsection (a), including 

recommendations to Congress and the States for any suggested legislative 

or regulatory changes.

SEC. 1833. RENEWABLE ENERGY ON FEDERAL LAND.

 (a) National <<NOTE: Contracts. Deadline.>> Academy of Sciences 

Study.--Not later than 90 days after the date of enactment of this Act, 

the Secretary of the Interior shall enter into a contract with the 

National Academy of Sciences under which the National Academy of 

Sciences shall--

 (1) study the potential of developing wind, solar, and ocean 

 energy resources (including tidal, wave, and thermal energy) on 

 Federal land available for those uses under current law and the 

 outer Continental Shelf;

 (2) assess any Federal law (including regulations) relating 

 to the development of those resources that is in existence on 

 the date of enactment of this Act; and

 (3) recommend statutory and regulatory mechanisms for 

 developing those resources.

 (b) Submission to Congress.--Not later than 2 years after the date 

of enactment of this Act, the Secretary of the Interior shall submit to 

Congress the results of the study under subsection (a).

SEC. 1834. INCREASED HYDROELECTRIC GENERATION AT EXISTING FEDERAL 

 FACILITIES.

 (a) In General.--The Secretary of the Interior, the Secretary, and 

the Secretary of the Army shall jointly conduct a study of the potential 

for increasing electric power production capability at federally owned 

or operated water regulation, storage, and conveyance facilities.

 (b) Content.--The study under this section shall include 

identification and description in detail of each facility that is 

capable, with or without modification, of producing additional 

hydroelectric power, including estimation of the existing potential for 

the facility to generate hydroelectric power.

 (c) Report.--The Secretaries shall submit to the Committees on 

Energy and Commerce, Resources, and Transportation and Infrastructure of 

the House of Representatives and the Committee on Energy and Natural 

Resources of the Senate a report on the findings, conclusions, and 

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recommendations of the study under this section by not later than 18 

months after the date of the enactment of this Act. The report shall 

include each of the following:

 (1) The identifications, descriptions, and estimations 

 referred to in subsection (b).

 (2) A description of activities currently conducted or 

 considered, or that could be considered, to produce additional 

 hydroelectric power from each identified facility.

 (3) A summary of prior actions taken by the Secretaries to 

 produce additional hydroelectric power from each identified 

 facility.

 (4) The costs to install, upgrade, or modify equipment or 

 take other actions to produce additional hydroelectric power

[[Page 119 STAT. 1140]]

 from each identified facility and the level of Federal power 

 customer involvement in the determination of such costs.

 (5) The benefits that would be achieved by such 

 installation, upgrade, modification, or other action, including 

 quantified estimates of any additional energy or capacity from 

 each facility identified under subsection (b).

 (6) A description of actions that are planned, underway, or 

 might reasonably be considered to increase hydroelectric power 

 production by replacing turbine runners, by performing generator 

 upgrades or rewinds, or construction of pumped storage 

 facilities.

 (7) The impact of increased hydroelectric power production 

 on irrigation, water supply, fish, wildlife, Indian tribes, 

 river health, water quality, navigation, recreation, fishing, 

 and flood control.

 (8) Any additional recommendations to increase hydroelectric 

 power production from, and reduce costs and improve efficiency 

 at, federally owned or operated water regulation, storage, and 

 conveyance facilities.

SEC. 1835. SPLIT-ESTATE FEDERAL OIL AND GAS LEASING AND DEVELOPMENT 

 PRACTICES.

 (a) Review.--In consultation with affected private surface owners, 

oil and gas industry, and other interested parties, the Secretary of the 

Interior shall undertake a review of the current policies and practices 

with respect to management of Federal subsurface oil and gas development 

activities and their effects on the privately owned surface. This review 

shall include--

 (1) a comparison of the rights and responsibilities under 

 existing mineral and land law for the owner of a Federal mineral 

 lease, the private surface owners and the Department;

 (2) a comparison of the surface owner consent provisions in 

 section 714 of the Surface Mining Control and Reclamation Act of 

 1977 (30 U.S.C. 1304) concerning surface mining of Federal coal 

 deposits and the surface owner consent provisions for oil and 

 gas development, including coalbed methane production; and

 (3) recommendations for administrative or legislative action 

 necessary to facilitate reasonable access for Federal oil and 

 gas activities while addressing surface owner concerns and 

 minimizing impacts to private surface.

 (b) Report.--The Secretary of the Interior shall report the results 

of such review to Congress not later than 180 days after the date of 

enactment of this Act.

SEC. 1836. RESOLUTION OF FEDERAL RESOURCE DEVELOPMENT CONFLICTS IN THE 

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 POWDER RIVER BASIN.

 (a) Review.--The <<NOTE: Wyoming. Montana.>> Secretary of the 

Interior shall review Federal and State laws in existence on the date of 

enactment of this Act in order to resolve any conflict relating to the 

Powder River Basin in Wyoming and Montana between--

 (1) the development of Federal coal; and

 (2) the development of Federal and non-Federal coalbed 

 methane.

 (b) Report.--Not later than 180 days after the date of enactment of 

this Act, the Secretary of the Interior shall submit to Congress a 

report that--

[[Page 119 STAT. 1141]]

 (1) describes methods of resolving a conflict described in 

 subsection (a); and

 (2) identifies a method preferred by the Secretary of the 

 Interior, including proposed legislative language, if any, 

 required to implement the method.

SEC. 1837. <<NOTE: China.>> NATIONAL SECURITY REVIEW OF INTERNATIONAL 

 ENERGY REQUIREMENTS.

 (a) Study.--The Secretary, in consultation with the Secretary of 

Defense and Secretary of Homeland Security, shall conduct a study of the 

growing energy requirements of the People's Republic of China and the 

implications of such growth on the political, strategic, economic, or 

national security interests of the United States, including--

 (1) an assessment of the type, nationality, and location of 

 energy assets that have been sought for investment by entities 

 located in the People's Republic of China;

 (2) an assessment of the extent to which investment in 

 energy assets by entities located in the People's Republic of 

 China has been on market-based terms and free from subsidies 

 from the People's Republic of China;

 (3) an assessment of the effect of investment in energy 

 assets by entities located in the People's Republic of China on 

 the control by the United States of dual-use and export-

 controlled technologies, including the effect on current and 

 future access to foreign and domestic sources of rare earth 

 elements used to produce such technologies;

 (4) an assessment of the relationship between the Government 

 of the People's Republic of China and energy-related businesses 

 located in the People's Republic of China;

 (5) an assessment of the impact on the world energy market 

 of the common practice of entities located in the People's 

 Republic of China of removing the energy assets owned or 

 controlled by such entities from the competitive market, with 

 emphasis on the effect if such practice expands along with the 

 growth in energy consumption of the People's Republic of China;

 (6) an examination of the United States energy policy and 

 foreign policy as it relates to ensuring a competitive global 

 energy market;

 (7) an examination of the relationship between the United 

 States and the People's Republic of China as it relates to 

 pursuing energy interests in a manner that avoids conflicts; and

 (8) a comparison of the appropriate laws and regulations of 

 other nations to determine whether a United States company would 

 be permitted to purchase, acquire, merge, or otherwise establish 

 a joint relationship with an entity whose primary place of 

 business is in that other nation, including the laws and 

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 regulations of the People's Republic of China.

 (b) Report and Recommendations.--Not later than 120 days after the 

date of the enactment of this Act, the Secretary, in consultation with 

the Secretary of Defense, shall report to the President and the Congress 

on the findings of the study described in subsection (a) and any 

recommendations the Secretaries consider appropriate.

[[Page 119 STAT. 1142]]

 (c) Regulatory Effect.--Notwithstanding <<NOTE: President. Effective 

date.>> any other provision of law, any instrumentality of the United 

States vested with authority to review a transaction that includes an 

investment in a United States domestic corporation may not conclude a 

national security review related to an investment in the energy assets 

of a United States domestic corporation by an entity owned or controlled 

by the government of the People's Republic of China for 21 days after 

the report to the President and the Congress, and until the President 

certifies that he has received the report described in subsection (b).

SEC. 1838. USED OIL RE-REFINING STUDY.

 The Secretary, in consultation with the Administrator of the 

Environmental Protection Agency, shall undertake a study of the energy 

and environmental benefits of the re-refining of used lubricating oil 

and report to Congress within 90 days after enactment of this Act 

including recommendations of specific steps that can be taken to improve 

collections of used lubricating oil and increase re-refining and other 

beneficial re-use of such oil.

SEC. 1839. <<NOTE: Deadline. Reports.>> TRANSMISSION SYSTEM MONITORING.

 Within 6 months after the date of enactment of this Act, the 

Secretary and the Federal Energy Regulatory Commission shall study and 

report to Congress on the steps which must be taken to establish a 

system to make available to all transmission system owners and Regional 

Transmission Organizations (as defined in the Federal Power Act) within 

the Eastern and Western Interconnections real-time information on the 

functional status of all transmission lines within such 

Interconnections. In such study, the Commission shall assess technical 

means for implementing such transmission information system and identify 

the steps the Commission or Congress must take to require the 

implementation of such system.

SEC. 1840. REPORT IDENTIFYING AND DESCRIBING THE STATUS OF POTENTIAL 

 HYDROPOWER FACILITIES.

 (a) Report Requirement.--Not later than 90 days after the date of 

enactment of this Act, the Secretary of the Interior, acting through the 

Bureau of Reclamation, shall submit to the Committee on Resources of the 

House of Representatives and the Committee on Energy and Natural 

Resources of the Senate a report identifying and describing the status 

of potential hydropower facilities included in water surface storage 

studies undertaken by the Secretary for projects that have not been 

completed or authorized for construction.

 (b) Report Contents.--The report shall include the following:

 (1) Identification of all surface storage studies authorized 

 by Congress since the enactment of the Reclamation Project Act 

 of 1939 (43 U.S.C. 485 et seq.).

 (2) The purposes of each project included within each study 

 identified under paragraph (1).

 (3) The status of each study identified under paragraph (1), 

 including for each study--

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 (A) whether the study is completed or, if not 

 completed, still authorized;

 (B) the level of analyses conducted at the 

 feasibility and reconnaissance levels of review;

[[Page 119 STAT. 1143]]

 (C) identifiable environmental impacts of each 

 project included in the study, including to fish and 

 wildlife, water quality, and recreation;

 (D) projected water yield from each such project;

 (E) beneficiaries of each such project;

 (F) the amount authorized and expended;

 (G) projected funding needs and timelines for 

 completing the study (if applicable);

 (H) anticipated costs of each such project; and

 (I) other factors that might interfere with 

 construction of any such project.

 (4) An identification of potential hydroelectric facilities 

 that might be developed pursuant to each study identified under 

 paragraph (1).

 (5) Applicable costs and benefits associated with potential 

 hydroelectric production pursuant to each study.

 Approved August 8, 2005.

LEGISLATIVE HISTORY--H.R. 6:

---------------------------------------------------------------------------

HOUSE REPORTS: No. 109-190 (Comm. of Conference).

CONGRESSIONAL RECORD, Vol. 151 (2005):

 Apr. 20, 21, considered and passed House.

 June 14-16, 20-23, 28, considered and passed Senate, 

 amended.

 July 28, House agreed to conference report.

 July 29, Senate agreed to conference report.

WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 41 (2005):

 Aug. 8, Presidential remarks and statement.

 <all>

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