II 

Calendar No. 267 

111TH CONGRESS 

2D SESSION S. 1733 

[Report No. 111–121] 

To create clean energy jobs, promote energy independence, reduce global 

warming pollution, and transition to a clean energy economy. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 30, 2009 

Mr. KERRY (for himself, Mrs. BOXER, and Mr. KIRK) introduced the following 

bill; which was read twice and referred to the Committee on Environment 

and Public Works 

FEBRUARY 2, 2010 

Reported by Mrs. BOXER, with an amendment 

[Strike out all after the enacting clause and insert the part printed in italic] 

A BILL 

To create clean energy jobs, promote energy independence, 

reduce global warming pollution, and transition to a 

clean energy economy. 

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

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

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

5 ‘‘Clean Energy Jobs and American Power Act’’. 


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

2 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Findings. 

Sec. 3. Economy-wide emission reduction goals. 

Sec. 4. Definitions. 

DIVISION A—AUTHORIZATIONS FOR POLLUTION REDUCTION, 

TRANSITION, AND ADAPTATION 

Sec. 101. Structure of Act. 

TITLE I—GREENHOUSE GAS REDUCTION PROGRAMS 

Subtitle A—Clean Transportation 

Sec. 111. Emission standards. 

‘‘PART B—MOBILE SOURCES

‘‘Sec. 821. Greenhouse gas emission standards for mobile sources. 

Sec. 112. Greenhouse gas emission reductions through transportation efficiency. 

‘‘PART C—TRANSPORTATION EMISSIONS

‘‘Sec. 831. Greenhouse gas emission reductions through transportation efficiency. 

Sec. 113. Transportation greenhouse gas emission reduction program grants. 

‘‘Sec. 832. Transportation greenhouse gas emission reduction program 

grants. 

Sec. 114. SmartWay transportation efficiency program. 

‘‘Sec. 822. SmartWay transportation efficiency program. 

Subtitle B—Carbon Capture and Sequestration 

Sec. 121. National strategy. 

Sec. 122. Regulations for geological sequestration sites. 

‘‘Sec. 813. Geological storage sites. 

Sec. 123. Studies and reports. 

Sec. 124. Performance standards for coal-fueled power plants. 

‘‘Sec. 812. Performance standards for new coal-fired power plants. 

Sec. 125. Carbon capture and sequestration demonstration and early deployment program. 

Subtitle C—Nuclear and Advanced Technologies 

Sec. 131. Findings and policy. 

Sec. 132. Nuclear worker training. 

Sec. 133. Nuclear safety and waste management programs. 

Subtitle D—Water Efficiency 

Sec. 141. WaterSense. 

Sec. 142. Federal procurement of water-efficient products. 

Sec. 143. State residential water efficiency and conservation incentives program. 


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Subtitle E—Miscellaneous 

Sec. 151. Office of Consumer Advocacy. 

Sec. 152. Clean technology business competition grant program. 

Sec. 153. Product carbon disclosure program. 

Sec. 154. State recycling programs. 

Sec. 155. Supplemental agriculture and forestry greenhouse gas reduction and 

renewable energy program. 

Sec. 156. Economic Development Climate Change Fund. 

‘‘Sec. 219. Economic Development Climate Change Fund. 

Sec. 157. Study of risk-based programs addressing vulnerable areas. 

Subtitle F—Energy Efficiency and Renewable Energy 

Sec. 161. Renewable energy. 

Sec. 162. Advanced biofuels. 

Sec. 163. Energy efficiency in building codes. 

Sec. 164. Retrofit for energy and environmental performance. 

Subtitle G—Emission Reductions From Public Transportation Vehicles 

Sec. 171. Short title. 

Sec. 172. State fuel economy regulation for taxicabs. 

Sec. 173. State regulation of motor vehicle emissions for taxicabs. 

Subtitle H—Clean Energy and Natural Gas 

Sec. 181. Clean Energy and Accelerated Emission Reduction Program. 

Sec. 182. Advanced natural gas technologies. 

TITLE II—RESEARCH 

Subtitle A—Energy Research 

Sec. 201. Advanced energy research. 

Subtitle B—Drinking Water Adaptation, Technology, Education, and 

Research 

Sec. 211. Effects of climate change on drinking water utilities. 

TITLE III—TRANSITION AND ADAPTATION 

Subtitle A—Green Jobs and Worker Transition 

PART 1—GREEN JOBS

Sec. 301. Clean energy curriculum development grants. 

Sec. 302. Development of Information and Resources clearinghouse for vocational education and job training in renewable energy sectors. 

Sec. 303. Green construction careers demonstration project. 

PART 2—CLIMATE CHANGE WORKER ADJUSTMENT ASSISTANCE

Sec. 311. Petitions, eligibility requirements, and determinations. 

Sec. 312. Program benefits. 

Sec. 313. General provisions. 

Subtitle B—International Climate Change Programs 


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Sec. 321. Strategic Interagency Board on International Climate Investment. 

Sec. 322. Emission reductions from reduced deforestation. 

‘‘PART E—SUPPLEMENTAL EMISSION REDUCTIONS

‘‘Sec. 751. Definitions. 

‘‘Sec. 752. Purposes. 

‘‘Sec. 753. Emission reductions from reduced deforestation. 

Sec. 323. International Clean Energy Deployment Program. 

Sec. 324. International climate change adaptation and global security program. 

Sec. 325. Evaluation and reports. 

Sec. 326. Report on climate actions of major economies. 

Subtitle C—Adapting to Climate Change 

PART 1—DOMESTIC ADAPTATION

SUBPART A—NATIONAL CLIMATE CHANGE ADAPTATION PROGRAM

Sec. 341. National Climate Change Adaptation Program. 

Sec. 342. Climate services. 

SUBPART B—PUBLIC HEALTH AND CLIMATE CHANGE

Sec. 351. Sense of Congress on public health and climate change. 

Sec. 352. Relationship to other laws. 

Sec. 353. National strategic action plan. 

Sec. 354. Advisory board. 

Sec. 355. Reports. 

Sec. 356. Definitions. 

SUBPART C—CLIMATE CHANGE SAFEGUARDS FOR NATURAL RESOURCES

CONSERVATION

Sec. 361. Purposes. 

Sec. 362. Natural resources climate change adaptation policy. 

Sec. 363. Definitions. 

Sec. 364. Council on Environmental Quality. 

Sec. 365. Natural Resources Climate Change Adaptation Panel. 

Sec. 366. Natural Resources Climate Change Adaptation Strategy. 

Sec. 367. Natural resources adaptation science and information. 

Sec. 368. Federal natural resource agency adaptation plans. 

Sec. 369. State natural resources adaptation plans. 

Sec. 370. Natural Resources Climate Change Adaptation Account. 

Sec. 371. National Fish and Wildlife Habitat and Corridors Information Program. 

Sec. 372. Additional provisions regarding Indian tribes. 

SUBPART D—ADDITIONAL CLIMATE CHANGE ADAPTATION PROGRAMS

Sec. 381. Water system mitigation and adaption partnerships. 

Sec. 382. Flood control, protection, prevention, and response. 

Sec. 383. Wildfire. 

Sec. 384. Coastal and Great Lakes State adaptation program. 

DIVISION B—POLLUTION REDUCTION AND INVESTMENT 

TITLE I—REDUCING GLOBAL WARMING POLLUTION 


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Subtitle A—Reducing Global Warming Pollution 

Sec. 101. Reducing global warming pollution. 

‘‘TITLE VII—GLOBAL WARMING POLLUTION REDUCTION AND 

INVESTMENT PROGRAM 

‘‘PART A—GLOBAL WARMING POLLUTION REDUCTION GOALS AND TARGETS

‘‘Sec. 701. Findings. 

‘‘Sec. 702. Economy-wide reduction goals. 

‘‘Sec. 703. Reduction targets for specified sources. 

‘‘Sec. 704. Supplemental pollution reductions. 

‘‘Sec. 705. Review and program recommendations. 

‘‘Sec. 706. National Academy review. 

‘‘Sec. 707. Presidential response and recommendations. 

‘‘PART B—DESIGNATION AND REGISTRATION OF GREENHOUSE GASES

‘‘Sec. 711. Designation of greenhouse gases. 

‘‘Sec. 712. Carbon dioxide equivalent value of greenhouse gases. 

‘‘Sec. 713. Greenhouse gas registry. 

‘‘Sec. 714. Perfluorocarbon regulation. 

‘‘PART C—PROGRAM RULES

‘‘Sec. 721. Emission allowances. 

‘‘Sec. 722. Prohibition of excess emissions. 

‘‘Sec. 723. Penalty for noncompliance. 

‘‘Sec. 724. Trading. 

‘‘Sec. 725. Banking and borrowing. 

‘‘Sec. 726. Market Stability Reserve. 

‘‘Sec. 727. Permits. 

‘‘Sec. 728. International emission allowances. 

‘‘PART D—OFFSETS

‘‘Sec. 731. Offsets Integrity Advisory Board. 

‘‘Sec. 732. Establishment of offsets program. 

‘‘Sec. 733. Eligible project types. 

‘‘Sec. 734. Requirements for offset projects. 

‘‘Sec. 735. Approval of offset projects. 

‘‘Sec. 736. Verification of offset projects. 

‘‘Sec. 737. Issuance of offset credits. 

‘‘Sec. 738. Audits. 

‘‘Sec. 739. Program review and revision. 

‘‘Sec. 740. Early offset supply. 

‘‘Sec. 741. Environmental considerations. 

‘‘Sec. 742. Trading. 

‘‘Sec. 743. Office of Offsets Integrity. 

‘‘Sec. 744. International offset credits. 

Sec. 102. Definitions. 

‘‘Sec. 700. Definitions. 

Sec. 103. Offset reporting requirements. 

Subtitle B—Disposition of Allowances 


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Sec. 111. Disposition of allowances for global warming pollution reduction program. 

‘‘PART H—DISPOSITION OF ALLOWANCES

‘‘Sec. 771. Allocation of emission allowances. 

‘‘Sec. 772. Electricity consumers. 

‘‘Sec. 773. Natural gas consumers. 

‘‘Sec. 774. Home heating oil and propane consumers. 

‘‘Sec. 775. Domestic fuel production. 

‘‘Sec. 776. Consumer protection. 

‘‘Sec. 777. Exchange for State-issued allowances. 

‘‘Sec. 778. Auction procedures. 

‘‘Sec. 779. Auctioning allowances for other entities. 

‘‘Sec. 780. Commercial deployment of carbon capture and sequestration 

technologies. 

‘‘Sec. 781. Oversight of allocations. 

‘‘Sec. 782. Early action recognition. 

‘‘Sec. 783. Establishment of Deficit Reduction Fund. 

Subtitle C—Additional Greenhouse Gas Standards 

Sec. 121. Greenhouse gas standards. 

‘‘TITLE VIII—ADDITIONAL GREENHOUSE GAS STANDARDS 

‘‘Sec. 801. Definitions. 

‘‘PART A—STATIONARY SOURCE STANDARDS

‘‘Sec. 811. Standards of performance. 

Sec. 122. HFC regulation. 

‘‘Sec. 619. Hydrofluorocarbons (HFCs). 

Sec. 123. Black carbon. 

‘‘PART E—BLACK CARBON

‘‘Sec. 851. Black carbon. 

Sec. 124. States. 

Sec. 125. State programs. 

‘‘PART F—MISCELLANEOUS

‘‘Sec. 861. State programs. 

‘‘Sec. 862. Grants for support of air pollution control programs. 

Sec. 126. Enforcement. 

Sec. 127. Conforming amendments. 

Sec. 128. Davis-Bacon compliance. 

Subtitle D—Carbon Market Assurance 

Sec. 131. Carbon market assurance. 

Subtitle E—Ensuring Real Reductions in Industrial Emissions 

Sec. 141. Ensuring real reductions in industrial emissions. 

‘‘PART F—ENSURING REAL REDUCTIONS IN INDUSTRIAL EMISSIONS


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‘‘Sec. 761. Purposes. 

‘‘Sec. 762. Definitions. 

‘‘Sec. 763. Eligible industrial sectors. 

‘‘Sec. 764. Distribution of emission allowance rebates. 

‘‘Sec. 765. International trade. 

TITLE II—PROGRAM ALLOCATIONS 

Sec. 201. Investment in clean vehicle technology. 

Sec. 202. State and local investment in energy efficiency and renewable energy. 

Sec. 203. Energy efficiency in building codes. 

Sec. 204. Building retrofit program. 

Sec. 205. Energy Innovation Hubs. 

Sec. 206. ARPA–E research. 

Sec. 207. International clean energy deployment program. 

Sec. 208. International climate change adaptation and global security. 

Sec. 209. Energy efficiency and renewable energy worker training. 

Sec. 210. Worker transition. 

Sec. 211. State programs for greenhouse gas reduction and climate adaptation. 

Sec. 212. Climate Change Health Protection and Promotion Fund. 

Sec. 213. Climate change safeguards for natural resources conservation. 

Sec. 214. Nuclear worker training. 

Sec. 215. Supplemental agriculture, renewable energy, and forestry. 

1 SEC. 2. FINDINGS. 

2 Congress finds that— 

3 (1) the United States can take back control of 

4 the energy future of the United States, strengthen 

5 economic competitiveness, safeguard the health of 

6 families and the environment, and ensure the na7 tional security, of the United States by increasing 

8 energy independence; 

9 (2) creating a clean energy future requires a 

10 comprehensive approach that includes support for 

11 the improvement of all energy sources, including 

12 coal, natural gas, nuclear power, and renewable gen13 eration; 

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1 tion and carbon pollution, and those benefits can be 

2 captured while generating additional savings for con3 sumers; 

4 (4) substantially increasing the investment in 

5 the clean energy future of the United States will 

6 provide economic opportunities to millions of people 

7 in the United States and drive future economic 

8 growth in this country; 

9 (5) the United States is responsible for many of 

10 the initial scientific advances in clean energy tech11 nology, but, as of September 2009, the United 

12 States has only 5 of the top 30 leading companies 

13 in solar, wind, and advanced battery technology; 

14 (6) investment in the clean energy sector will 

15 allow companies in the United States to retake a 

16 leadership position, and the jobs created by those in17 vestments will significantly accelerate growth in do18 mestic manufacturing; 

19 (7) those opportunities also will result in sub20 stantial employment gains in construction, a sector 

21 in which the median hourly wage is 17 percent high22 er than the national median; 

23 (8) those jobs are distributed throughout the 

24 United States, and the highest clean energy economy 

25 employment growth rates in the last 10 years were 


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1 in the States of Idaho, Nebraska, South Dakota, Or2 egon, and New Mexico; 

3 (9) focusing on clean energy will dramatically 

4 reduce pollution and significantly improve the health 

5 of families in and the environment of the United 

6 States; 

7 (10) moving to a low-carbon economy must pro8 tect the most vulnerable populations in the United 

9 States, including low-income families that are par10 ticularly affected by volatility in energy prices; 

11 (11) if unchecked, the impact of climate change 

12 will include widespread effects on health and welfare, 

13 including— 

14 (A) increased outbreaks from waterborne 

15 diseases; 

16 (B) more droughts; 

17 (C) diminished agricultural production; 

18 (D) severe storms and floods; 

19 (E) heat waves; 

20 (F) wildfires; and 

21 (G) a substantial rise in sea levels, due in 

22 part to— 

23 (i) melting mountain glaciers; 

24 (ii) shrinking sea ice; and 

25 (iii) thawing permafrost; 


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1 (12) the most recent science indicates that the 

2 changes described in paragraph (11)(G) are occur3 ring faster and with greater intensity than expected; 

4 (13) military officials, including retired admi5 rals and generals, concur with the intelligence com6 munity that climate change acts as a threat multi7 plier for instability and presents significant national 

8 security challenges for the United States; 

9 (14) massive portions of the infrastructure of 

10 the United States, including critical military infra11 structure, are at risk from the effects of climate 

12 change; 

13 (15) impacts are already being felt in local com14 munities within the United States as well as by at15 risk populations abroad; 

16 (16) the Declaration of the Leaders from the 

17 Major Economies Forum on Energy and Climate, 

18 representing 17 of the largest economies in the 

19 world, recognizes the need to limit the increase in 

20 global average temperatures to within 2 degrees 

21 Centigrade, as a necessary step to prevent the cata22 strophic consequences of climate change; and 

23 (17) the United States should lead the global 

24 community in combating the threat of global climate 

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1 ment to address global warming under the United 

2 Nations Framework Convention on Climate Change, 

3 done at New York on May 9, 1992 (or a successor 

4 agreement). 

5 SEC. 3. ECONOMY-WIDE EMISSION REDUCTION GOALS. 

6 The goals of this Act and the amendments made by 

7 this Act are to reduce steadily the quantity of United 

8 States greenhouse gas emissions such that— 

9 (1) in 2012, the quantity of United States 

10 greenhouse gas emissions does not exceed 97 percent 

11 of the quantity of United States greenhouse gas 

12 emissions in 2005; 

13 (2) in 2020, the quantity of United States 

14 greenhouse gas emissions does not exceed 80 percent 

15 of the quantity of United States greenhouse gas 

16 emissions in 2005; 

17 (3) in 2030, the quantity of United States 

18 greenhouse gas emissions does not exceed 58 percent 

19 of the quantity of United States greenhouse gas 

20 emissions in 2005; and 

21 (4) in 2050, the quantity of United States 

22 greenhouse gas emissions does not exceed 17 percent 

23 of the quantity of United States greenhouse gas 

24 emissions in 2005. 


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1 SEC. 4. DEFINITIONS. 

2 In this Act: 

3 (1) ADMINISTRATOR.—The term ‘‘Adminis4 trator’’ means the Administrator of the Environ5 mental Protection Agency. 

6 (2) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 

7 has the meaning given the term in section 302 of the 

8 Clean Air Act (42 U.S.C. 7602). 

9 (3) STATE.—The term ‘‘State’’ has the mean10 ing given that term in section 302 of the Clean Air 

11 Act (42 U.S.C. 7602). 

12 DIVISION A—AUTHORIZATIONS 

13 FOR POLLUTION REDUCTION, 

14 TRANSITION, AND ADAPTA15 TION 

16 SEC. 101. STRUCTURE OF ACT. 

17 (a) AUTHORIZED AND ALLOCATED PROGRAMS.—The 

18 following programs authorized under this division are eli19 gible to receive an allocation under title VII of the Clean 

20 Air Act: 

21 (1) The program for greenhouse gas emission 

22 reductions through transportation efficiency under 

23 part C of title VIII the Clean Air Act (as added by 

24 sections 112 and 113 of this division). 


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1 (2) The program for nuclear worker training 

2 under section 132 of this division and 214 of divi3 sion B. 

4 (3) State recycling programs under section 154 

5 of this division and section 211 of division B. 

6 (4) The supplemental agriculture and forestry 

7 greenhouse gas reduction and renewable energy pro8 gram under section 155 of this division and section 

9 215 of division B. 

10 (5) The program for energy efficiency in build11 ing codes under section 163 of this division and sec12 tion 203 of division B. 

13 (6) The program for retrofit for energy and en14 vironmental performance under section 164 of this 

15 division and section 204 of division B. 

16 (7) The program for worker transition under 

17 part 2 of subtitle A of title III of this division and 

18 section 210 of division B. 

19 (8) The program for public health and climate 

20 change under subpart B of part 1 of subtitle C of 

21 title III of this division and section 212 of division 

22 B. 

23 (9) The program for climate change safeguards 

24 for natural resources conservation under subpart C 


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1 of part 1 of subtitle C of title III of this division and 

2 section 213 of division B. 

3 (10) The program for emission reductions from 

4 reduced deforestation under section 753 of the Clean 

5 Air Act (as added by section 322 of this division) 

6 and section 771(d) of the Clean Air Act (as added 

7 by section 111 of division B). 

8 (11) The International Clean Energy Deploy9 ment Program under section 323 of this division and 

10 section 207 of division B. 

11 (12) The international climate change adapta12 tion and global security program under 324 of this 

13 division and section 208 of division B. 

14 (13) The program for water system mitigation 

15 and adaptation partnerships under section 381 of 

16 this division and section 211 of division B. 

17 (14) The program for flood control, protection, 

18 prevention, and response under section 382 of this 

19 division and section 211 of division B. 

20 (15) The program for wildfire under section 

21 383 of this division and section 211 of division B. 

22 (16) The Coastal and Great Lakes State Adap23 tation Program under section 384 of this division 

24 and section 211 of division B. 


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1 (b) ALLOCATED PROGRAMS.—The following alloca2 tions are provided under title VII of the Clean Air Act: 

3 (1) The Market Stability Reserve Fund under 

4 section 726 of the Clean Air Act (as added by sec5 tion 101 of division B). 

6 (2) The program to ensure real reductions in 

7 industrial emissions under part F of title VII of the 

8 Clean Air Act (as added by section 141 of division 

9 B). 

10 (3) The program for electricity consumers pur11 suant to section 772 of the Clean Air Act (as added 

12 by section 111 of division B). 

13 (4) The program for natural gas consumers 

14 pursuant to section 773 of the Clean Air Act (as 

15 added by section 111 of division B). 

16 (5) The program for home heating oil and pro17 pane consumers pursuant to section 774 of the 

18 Clean Air Act (as added by section 111 of division 

19 B). 

20 (6) The program for domestic fuel production, 

21 including petroleum refiners and small business re22 finers, under section 775 of the Clean Air Act (as 

23 added by section 111 of division B). 

24 (7) The program for climate change consumer 

25 refunds and low- and moderate-income consumers 


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1 pursuant to section 776 of the Clean Air Act (as 

2 added by section 111 of division B), including— 

3 (A) consumer rebates under section 776(a) 

4 of the Clean Air Act (as so added); and 

5 (B) energy refunds under section 776(b) of 

6 the Clean Air Act (as so added). 

7 (8) The program for commercial deployment of 

8 carbon capture and storage technology under section 

9 780 of the Clean Air Act (as added by section 111 

10 of division B). 

11 (9) The program for early action recognition 

12 pursuant to section 782 of the Clean Air Act (as 

13 added by section 111 of division B). 

14 (10) The program for investment in clean vehi15 cle technology under section 201 of division B. 

16 (11) The program for State and local invest17 ment in energy efficiency and renewable energy 

18 under section 202 of division B. 

19 (12) The program for Energy Innovation Hubs 

20 pursuant to section 205 of division B. 

21 (13) The program for ARPA–E research pursu22 ant to section 206 of division B. 

23 (14) The program for energy efficiency and re24 newable energy worker training under section 209 of 

25 division B. 


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1 (15) The State programs for greenhouse gas re2 duction and climate adaptation pursuant to section 

3 211 of division B. 

4 (c) NONALLOCATED PROGRAMS.—The following pro5 grams are authorized under this division: 

6 (1) The SmartWay Transportation Efficiency 

7 Program under section 822 of the Clean Air Act (as 

8 added by section 114 of this division). 

9 (2) The carbon capture and sequestration dem10 onstration and early deployment program under sec11 tion 125 of this division. 

12 (3) The nuclear safety and waste management 

13 programs under section 133 of this division. 

14 (4) Water efficiency programs under subtitle D 

15 of title I of this division. 

16 (5) The Office of Consumer Advocacy under 

17 section 151 of this division. 

18 (6) The clean technology business competition 

19 grant program under section 152 of this division. 

20 (7) The product carbon disclosure program 

21 under section 153 of this division. 

22 (8) The Economic Development Climate 

23 Change Fund under section 219 of the Public Works 

24 and Economic Development Act of 1965 (as added 

25 by section 156 of this division). 


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1 (9) The program for renewable energy under 

2 section 161 of this division. 

3 (10) The program for advanced biofuels under 

4 section 162 of this division. 

5 (11) The program for emission reductions from 

6 public transportation vehicles under subtitle G of 

7 title I of this division. 

8 (12) The Clean Energy and Accelerated Emis9 sion Reduction Program under section 181 of this 

10 division. 

11 (13) The program for advanced natural gas 

12 technologies under section 182 of this division. 

13 (14) The program for advanced energy research 

14 under subtitle A of title II of this division. 

15 (15) The program for drinking water adapta16 tion, technology, education, and research under sub17 title B of title II of this division. 

18 (16) The program for clean energy curriculum 

19 development grants under section 301 of this divi20 sion. 

21 (17) The program for Development of Informa22 tion and Resources clearinghouse for vocational edu23 cation and job training in renewable energy sectors 

24 under section 302 of this division. 


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1 (18) The green construction careers demonstra2 tion project under section 303 of this division. 

3 TITLE I—GREENHOUSE GAS 

4 REDUCTION PROGRAMS 

5 Subtitle A—Clean Transportation 

6 SEC. 111. EMISSION STANDARDS. 

7 Title VIII of the Clean Air Act (as added by section 

8 121 of division B) is amended by adding at the end the 

9 following: 

10 ‘‘PART B—MOBILE SOURCES 

11 ‘‘SEC. 821. GREENHOUSE GAS EMISSION STANDARDS FOR 

12 MOBILE SOURCES. 

13 ‘‘(a) NEW MOTOR VEHICLES AND NEW MOTOR VE14 HICLE ENGINES.—(1) Pursuant to section 202(a)(1), by 

15 December 31, 2010, the Administrator shall promulgate 

16 standards applicable to emissions of greenhouse gases 

17 from new heavy-duty motor vehicles or new heavy-duty 

18 motor vehicle engines, excluding such motor vehicles cov19 ered by the Tier II standards (as established by the Ad20 ministrator as of the date of the enactment of this sec21 tion). The Administrator may revise these standards from 

22 time to time. 

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1 gines, excluding such motor vehicles covered by the Tier 

2 II standards (as established by the Administrator as of 

3 the date of the enactment of this section), shall contain 

4 standards that reflect the greatest degree of emissions re5 duction achievable through the application of technology 

6 which the Administrator determines will be available for 

7 the model year to which such standards apply, giving ap8 propriate consideration to cost, energy, and safety factors 

9 associated with the application of such technology. Any 

10 such regulations shall take effect after such period as the 

11 Administrator finds necessary to permit the development 

12 and application of the requisite technology, and, at a min13 imum, shall apply for a period no less than 3 model years 

14 beginning no earlier than the model year commencing 4 

15 years after such regulations are promulgated. 

16 ‘‘(3) Regulations issued under section 202(a)(1) ap17 plicable to emissions of greenhouse gases from new heavy18 duty motor vehicles or new heavy-duty motor vehicle en19 gines, excluding such motor vehicles covered by the Tier 

20 II standards (as established by the Administrator as of 

21 the date of the enactment of this section), shall supersede 

22 and satisfy any and all of the rulemaking and compliance 

23 requirements of section 32902(k) of title 49, United 

24 States Code. 


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1 ‘‘(4) Other than as specifically set forth in paragraph 

2 (3) of this subsection, nothing in this section shall affect 

3 or otherwise increase or diminish the authority of the Sec4 retary of Transportation to adopt regulations to improve 

5 the overall fuel efficiency of the commercial goods move6 ment system. 

7 ‘‘(b) NONROAD VEHICLES AND ENGINES.—(1) Pur8 suant to section 213(a)(4) and (5), the Administrator 

9 shall identify those classes or categories of new nonroad 

10 vehicles or engines, or combinations of such classes or cat11 egories, that, in the judgment of the Administrator, both 

12 contribute significantly to the total emissions of green13 house gases from nonroad engines and vehicles, and pro14 vide the greatest potential for significant and cost-effective 

15 reductions in emissions of greenhouse gases. The Adminis16 trator shall promulgate standards applicable to emissions 

17 of greenhouse gases from these new nonroad engines or 

18 vehicles by December 31, 2012. The Administrator shall 

19 also promulgate standards applicable to emissions of 

20 greenhouse gases for such other classes and categories of 

21 new nonroad vehicles and engines as the Administrator de22 termines appropriate and in the timeframe the Adminis23 trator determines appropriate. The Administrator shall 

24 base such determination, among other factors, on the rel25 ative contribution of greenhouse gas emissions, and the 


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1 costs for achieving reductions, from such classes or cat2 egories of new nonroad engines and vehicles. The Adminis3 trator may revise these standards from time to time. 

4 ‘‘(2) Standards under section 213(a)(4) and (5) ap5 plicable to emissions of greenhouse gases from those class6 es or categories of new nonroad engines or vehicles identi7 fied in the first sentence of paragraph (1) of this sub8 section, shall achieve the greatest degree of emissions re9 duction achievable based on the application of technology 

10 which the Administrator determines will be available at 

11 the time such standards take effect, taking into consider12 ation cost, energy, and safety factors associated with the 

13 application of such technology. Any such regulations shall 

14 take effect at the earliest possible date after such period 

15 as the Administrator finds necessary to permit the devel16 opment and application of the requisite technology, giving 

17 appropriate consideration to the cost of compliance within 

18 such period, the applicable compliance dates for other 

19 standards, and other appropriate factors, including the pe20 riod of time appropriate for the transfer of applicable tech21 nology from other applications, including motor vehicles, 

22 and the period of time in which previously promulgated 

23 regulations have been in effect. 

24 ‘‘(3) For purposes of this section and standards 

25 under section 213(a)(4) or (5) applicable to emissions of 


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1 greenhouse gases, the term ‘nonroad engines and vehicles’ 

2 shall include non-internal combustion engines and the ve3 hicles these engines power (such as electric engines and 

4 electric vehicles), for those non-internal combustion en5 gines and vehicles which would be in the same category 

6 and have the same uses as nonroad engines and vehicles 

7 that are powered by internal combustion engines. 

8 ‘‘(c) AVERAGING, BANKING, AND TRADING OF EMIS9 SIONS CREDITS.—In establishing standards applicable to 

10 emissions of greenhouse gases pursuant to this section and 

11 sections 202(a), 213(a)(4) and (5), and 231(a), the Ad12 ministrator may establish provisions for averaging, bank13 ing, and trading of greenhouse gas emissions credits with14 in or across classes or categories of motor vehicles and 

15 motor vehicle engines, nonroad vehicles and engines (in16 cluding marine vessels), and aircraft and aircraft engines, 

17 to the extent the Administrator determines appropriate 

18 and considering the factors appropriate in setting stand19 ards under those sections. Such provisions may include 

20 reasonable and appropriate provisions concerning genera21 tion, banking, trading, duration, and use of credits. 

22 ‘‘(d) REPORTS.—The Administrator shall, from time 

23 to time, submit a report to Congress that projects the 

24 amount of greenhouse gas emissions from the transpor25 tation sector, including transportation fuels, for the years 


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1 2030 and 2050, based on the standards adopted under 

2 this section. 

3 ‘‘(e) GREENHOUSE GASES.—Notwithstanding the 

4 provisions of section 711, hydrofluorocarbons shall be con5 sidered a greenhouse gas for purposes of this section.’’. 

6 SEC. 112. GREENHOUSE GAS EMISSION REDUCTIONS 

7 THROUGH TRANSPORTATION EFFICIENCY. 

8 (a) ENVIRONMENTAL PROTECTION AGENCY.—Title 

9 VIII of the Clean Air Act (as amended by section 111 

10 of this division) is amended by adding at the end the fol11 lowing: 

12 ‘‘PART C—TRANSPORTATION EMISSIONS 

13 ‘‘SEC. 831. GREENHOUSE GAS EMISSION REDUCTIONS 

14 THROUGH TRANSPORTATION EFFICIENCY. 

15 ‘‘(a) IN GENERAL.—The Administrator, in consulta16 tion with the Secretary of Transportation (referred to in 

17 this part as the ‘Secretary’), shall promulgate, and update 

18 from time to time, regulations to establish— 

19 ‘‘(1) national transportation-related greenhouse 

20 gas emission reduction goals that are commensurate 

21 with the emission reduction goals established under 

22 the Clean Energy Jobs and American Power Act 

23 and amendments made by that Act; 

24 ‘‘(2) standardized emission models and related 

25 methods, to be used by States, metropolitan planVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00024 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 ning organizations, and air quality agencies to ad2 dress emission reduction goals, including— 

3 ‘‘(A) the development of surface transpor4 tation-related greenhouse gas emission reduc5 tion targets pursuant to sections 134 and 135 

6 of title 23, and sections 5303 and 5304 of title 

7 49, United States Code; 

8 ‘‘(B) the assessment of projected surface 

9 transportation-related greenhouse gas emissions 

10 from transportation strategies; 

11 ‘‘(C) the assessment of projected surface 

12 transportation-related greenhouse gas emissions 

13 from State and regional transportation plans; 

14 ‘‘(D) the establishment of surface trans15 portation-related greenhouse gas emission base16 lines at a national, State, and regional level; 

17 and 

18 ‘‘(E) the measurement and assessment of 

19 actual surface transportation-related emissions 

20 to assess progress toward achievement of emis21 sion targets at the State and regional level; 

22 ‘‘(3) methods for collection of data on transpor23 tation-related greenhouse gas emissions; and 

24 ‘‘(4) publication and distribution of successful 

25 strategies employed by States, metropolitan planning 


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1 organizations, and other entities to reduce transpor2 tation-related greenhouse gas emissions. 

3 ‘‘(b) ROLE OF DEPARTMENT OF TRANSPOR4 TATION.—The Secretary, in consultation with the Admin5 istrator, shall promulgate, and update from time to time, 

6 regulations— 

7 ‘‘(1) to improve the ability of transportation 

8 planning models and tools, including travel demand 

9 models, to address greenhouse gas emissions; 

10 ‘‘(2) to assess projected surface transportation11 related travel activity and transportation strategies 

12 from State and regional transportation plans; and 

13 ‘‘(3) to update transportation planning require14 ments and approval of transportation plans as nec15 essary to carry out this section. 

16 ‘‘(c) CONSULTATION AND MODELS.—In promul17 gating the regulations, the Administrator and the Sec18 retary— 

19 ‘‘(1) shall consult with States, metropolitan 

20 planning organizations, and air quality agencies; 

21 ‘‘(2) may use existing models and methodolo22 gies if the models and methodologies are widely con23 sidered to reflect the best practicable modeling or 

24 methodological approach for assessing actual and 

25 projected transportation-related greenhouse gas 


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1 emissions from transportation plans and projects; 

2 and 

3 ‘‘(3) shall consider previously developed plans 

4 that were based on models and methodologies for re5 ducing greenhouse gas emissions in applying those 

6 regulations to the first approvals after promulgation. 

7 ‘‘(d) TIMING.—The Administrator and the Secretary 

8 shall— 

9 ‘‘(1) publish proposed regulations under sub10 sections (a) and (b) not later than 1 year after the 

11 date of enactment of this section; and 

12 ‘‘(2) promulgate final regulations under sub13 sections (a) and (b) not later than 18 months after 

14 the date of enactment of this section. 

15 ‘‘(e) ASSESSMENT.— 

16 ‘‘(1) IN GENERAL.—At least every 6 years after 

17 promulgating final regulations under subsections (a) 

18 and (b), the Administrator and the Secretary shall 

19 jointly assess current and projected progress in re20 ducing national transportation-related greenhouse 

21 gas emissions. 

22 ‘‘(2) REQUIREMENTS.—The assessment shall 

23 examine the contributions to emission reductions at24 tributable to— 

25 ‘‘(A) improvements in vehicle efficiency; 


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1 ‘‘(B) greenhouse gas performance of trans2 portation fuels; 

3 ‘‘(C) reductions in vehicle miles traveled; 

4 ‘‘(D) changes in consumer demand and use 

5 of transportation management systems; and 

6 ‘‘(E) any other greenhouse gas-related 

7 transportation policies enacted by Congress. 

8 ‘‘(3) RESULTS OF ASSESSMENT.—The Sec9 retary and the Administrator shall consider— 

10 ‘‘(A) the results of the assessment con11 ducted under this subsection; and 

12 ‘‘(B) based on those results, whether tech13 nical or other updates to regulations required 

14 under this section and sections 134 and 135 of 

15 title 23, and sections 5303 and 5304 of title 49, 

16 United States Code, are necessary.’’. 

17 (b) METROPOLITAN PLANNING ORGANIZATIONS.— 

18 (1) TITLE 23.—Section 134 of title 23, United 

19 States Code, is amended— 

20 (A) in subsection (a)(1)— 

21 (i) by striking ‘‘minimizing’’ and in22 serting ‘‘reducing’’; and 

23 (ii) by inserting ‘‘, reliance on oil, im24 pacts on the environment, transportationVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00028 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 related greenhouse gas emissions,’’ after 

2 ‘‘consumption’’; 

3 (B) in subsection (h)(1)(E)— 

4 (i) by inserting ‘‘sustainability, and 

5 livability, reduce surface transportation-re6 lated greenhouse gas emissions and reli7 ance on oil, adapt to the effects of climate 

8 change,’’ after ‘‘energy conservation,’’; 

9 (ii) by inserting ‘‘and public health’’ 

10 after ‘‘quality of life’’; and 

11 (iii) by inserting ‘‘, including housing 

12 and land use patterns’’ after ‘‘development 

13 patterns’’; 

14 (C) in subsection (i)— 

15 (i) in paragraph (4)(A)— 

16 (I) by striking ‘‘consult, as ap17 propriate,’’ and inserting ‘‘cooperate’’; 

18 (II) by inserting ‘‘transportation, 

19 public transportation, air quality, and 

20 housing, and shall consult, as appro21 priate, with State and local agencies 

22 responsible for’’ after ‘‘responsible 

23 for’’; and 

24 (III) by inserting ‘‘public 

25 health,’’ after ‘‘conservation,’’; and 


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1 (ii) in paragraph (5)(C)(iii), by insert2 ing ‘‘and through the website of the metro3 politan planning organization, including 

4 emission reduction targets and strategies 

5 developed under subsection (k)(6), includ6 ing an analysis of the anticipated effects of 

7 the targets and strategies,’’ after ‘‘World 

8 Wide Web’’; and 

9 (D) in subsection (k), by adding at the end 

10 the following: 

11 ‘‘(6) TRANSPORTATION GREENHOUSE GAS RE12 DUCTION EFFORTS.— 

13 ‘‘(A) IN GENERAL.—Within a metropolitan 

14 planning area serving a transportation manage15 ment area, the transportation planning process 

16 under this section shall address transportation17 related greenhouse gas emissions by including 

18 emission reduction targets and strategies to 

19 meet those targets. 

20 ‘‘(B) ELIGIBLE ORGANIZATIONS.— 

21 ‘‘(i) MPOS WITHIN TMAS.—All provi22 sions and requirements of this section, in23 cluding the requirements of the transpor24 tation greenhouse gas reduction efforts, 

25 shall apply to metropolitan planning orgaVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00030 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 nizations that also serve as transportation 

2 management areas. 

3 ‘‘(ii) OTHER MPOS.—A metropolitan 

4 planning organization that does not serve 

5 as a transportation management area— 

6 ‘‘(I) may develop transportation 

7 greenhouse gas emission reduction 

8 targets and strategies to meet those 

9 targets; and 

10 ‘‘(II) if those targets and strate11 gies are developed, shall be subject to 

12 all applicable provisions and require13 ments of this section and the Clean 

14 Energy Jobs and American Power 

15 Act, including requirements of the 

16 transportation greenhouse gas reduc17 tion efforts. 

18 ‘‘(C) ESTABLISHMENT OF TARGETS AND

19 CRITERIA.— 

20 ‘‘(i) IN GENERAL.—Not later than 2 

21 years after the promulgation of the final 

22 regulations required under section 831 of 

23 the Clean Air Act, each metropolitan plan24 ning organization that also serves as a 

25 transportation management area shall deVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00031 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 velop surface transportation-related green2 house gas emission reduction targets, as 

3 well as strategies to meet those targets, in 

4 consultation with State air agencies as 

5 part of the metropolitan transportation 

6 planning process under this section. 

7 ‘‘(ii) MULTIPLE DESIGNATIONS.—If 

8 more than 1 metropolitan planning organi9 zation has been designated within a metro10 politan area, each metropolitan planning 

11 organization shall coordinate with other 

12 metropolitan planning organizations in the 

13 same metropolitan area to develop the tar14 gets and strategies described in clause (i). 

15 ‘‘(iii) MINIMUM REQUIREMENTS.— 

16 Each metropolitan transportation plan de17 veloped by a metropolitan planning organi18 zation under clause (i) shall, within the 

19 plan, demonstrate progress in stabilizing 

20 and reducing transportation-related green21 house gas emissions so as to contribute to 

22 the achievement of State targets pursuant 

23 to section 135(f)(9). 

24 ‘‘(iv) REQUIREMENTS FOR TARGETS

25 AND STRATEGIES.—The targets and stratVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00032 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 egies developed under this subparagraph 

2 shall, at a minimum— 

3 ‘‘(I) be based on the emission 

4 and travel demand models and related 

5 methodologies established in the final 

6 regulations required under section 

7 831 of the Clean Air Act; 

8 ‘‘(II) inventory all sources of sur9 face transportation-related greenhouse 

10 gas emissions; 

11 ‘‘(III) apply to those modes of 

12 surface transportation that are ad13 dressed in the planning process under 

14 this section; 

15 ‘‘(IV) be integrated and con16 sistent with regional transportation 

17 plans and transportation improvement 

18 programs; and 

19 ‘‘(V) be selected through scenario 

20 analysis, and include, pursuant to the 

21 requirements of the transportation 

22 planning process under this section, 

23 transportation investment and man24 agement strategies that reduce green25 house gas emissions from the transVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00033 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 portation sector over the life of the 

2 plan, such as— 

3 ‘‘(aa) efforts to increase 

4 public transportation ridership, 

5 including through service im6 provements, capacity expansions, 

7 and access enhancement; 

8 ‘‘(bb) efforts to increase 

9 walking, bicycling, and other 

10 forms of nonmotorized transpor11 tation; 

12 ‘‘(cc) implementation of zon13 ing and other land use regula14 tions and plans to support infill, 

15 transit-oriented development, re16 development, or mixed use devel17 opment; 

18 ‘‘(dd) travel demand man19 agement programs (including 

20 carpool, vanpool, or car-share 

21 projects), transportation pricing 

22 measures, parking policies, and 

23 programs to promote telecom24 muting, flexible work schedules, 

25 and satellite work centers; 


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1 ‘‘(ee) surface transportation 

2 system operation improvements, 

3 including intelligent transpor4 tation systems or other oper5 ational improvements to reduce 

6 long-term greenhouse gas emis7 sions through reduced congestion 

8 and improved system manage9 ment; 

10 ‘‘(ff) intercity passenger rail 

11 improvements; 

12 ‘‘(gg) intercity bus improve13 ments; 

14 ‘‘(hh) freight rail improve15 ments; 

16 ‘‘(ii) use of materials or 

17 equipment associated with the 

18 construction or maintenance of 

19 transportation projects that re20 duce greenhouse gas emissions; 

21 ‘‘(jj) public facilities for sup22 plying electricity to electric or 

23 plug-in hybrid-electric vehicles; or 

24 ‘‘(kk) any other effort that 

25 demonstrates progress in reducVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00035 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 ing transportation-related green2 house gas emissions in each met3 ropolitan planning organization 

4 under this subsection. 

5 ‘‘(D) REVIEW AND APPROVAL.—Not later 

6 than 180 days after the date of submission of 

7 a plan under this section— 

8 ‘‘(i) the Secretary and the Adminis9 trator shall review the plan; and 

10 ‘‘(ii) the Secretary shall approve a 

11 plan developed by a metropolitan planning 

12 organization pursuant to subparagraph (C) 

13 if— 

14 ‘‘(I) the Secretary finds that a 

15 metropolitan planning organization 

16 has developed, submitted, and pub17 lished the plan of the metropolitan 

18 planning organization pursuant to this 

19 section; 

20 ‘‘(II) the Secretary, in consulta21 tion with the Administrator, deter22 mines that the plan is likely to achieve 

23 the targets established by the metro24 politan planning organization under 

25 this subsection; and 


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1 ‘‘(III) the development of the 

2 plan complies with the minimum re3 quirements established under clauses 

4 (iii) and (iv) of subparagraph (C). 

5 ‘‘(E) CERTIFICATION.—Failure to comply 

6 with the requirements under subparagraph (C) 

7 shall not impact certification standards under 

8 paragraph (5). 

9 ‘‘(7) DEFINITION OF METROPOLITAN PLANNING

10 ORGANIZATION.—In this subsection, the term ‘met11 ropolitan planning organization’ means a metropoli12 tan planning organization described in clause (i) or 

13 (ii) of paragraph (6)(B). 

14 ‘‘(8) SCENARIO ANALYSIS.—The term ‘scenario 

15 analysis’ means the use of a planning tool that— 

16 ‘‘(A) develops a range of scenarios rep17 resenting various combinations of transpor18 tation and land use strategies, and estimates of 

19 how each of those scenarios would perform in 

20 meeting the greenhouse gas emission reduction 

21 targets based on analysis of various forces 

22 (such as health, transportation, economic or en23 vironmental factors, and land use) that affect 

24 growth; 

25 ‘‘(B) may include features such as— 


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1 ‘‘(i) the involvement of the general 

2 public, key stakeholders, and elected offi3 cials on a broad scale; 

4 ‘‘(ii) the creation of an opportunity 

5 for those participants to educate each 

6 other as to growth trends and trade-offs, 

7 as a means to incorporate values and feed8 back into future plans; and 

9 ‘‘(iii) the use of continuing efforts and 

10 ongoing processes; and 

11 ‘‘(C) may include key elements such as— 

12 ‘‘(i) identification of the driving forces 

13 behind planning decisions and outcomes; 

14 ‘‘(ii) determination of patterns of 

15 interaction; 

16 ‘‘(iii) creation of scenarios for discus17 sion purposes; 

18 ‘‘(iv) analysis of implications; 

19 ‘‘(v) evaluation of scenarios; and 

20 ‘‘(vi) use of monitoring indicators.’’. 

21 (2) TITLE 49.—Section 5303 of title 49, United 

22 States Code, is amended— 

23 (A) in subsection (a)(1)— 

24 (i) by striking ‘‘minimizing’’ and in25 serting ‘‘reducing’’; and 


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1 (ii) by inserting ‘‘, reliance on oil, im2 pacts on the environment, transportation3 related greenhouse gas emissions,’’ after 

4 ‘‘consumption’’; 

5 (B) in subsection (h)(1)(E)— 

6 (i) by inserting ‘‘sustainability, and 

7 livability, reduce surface transportation-re8 lated greenhouse gas emissions and reli9 ance on oil, adapt to the effects of climate 

10 change,’’ after ‘‘energy conservation,’’; 

11 (ii) by inserting ‘‘and public health’’ 

12 after ‘‘quality of life’’; and 

13 (iii) by inserting ‘‘, including housing 

14 and land use patterns’’ after ‘‘development 

15 patterns’’; 

16 (C) in subsection (i)— 

17 (i) in paragraph (4)(A)— 

18 (I) by striking ‘‘consult, as ap19 propriate,’’ and inserting ‘‘cooperate’’; 

20 (II) by inserting ‘‘transportation, 

21 public transportation, air quality, and 

22 housing, and shall consult, as appro23 priate, with State and local agencies 

24 responsible for’’ after ‘‘responsible 

25 for’’; and 


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1 (III) by inserting ‘‘public 

2 health,’’ after ‘‘conservation,’’; and 

3 (ii) in paragraph (5)(C)(iii), by insert4 ing ‘‘and through the website of the metro5 politan planning organization, including 

6 emission reduction targets and strategies 

7 developed under subsection (k)(6), includ8 ing an analysis of the anticipated effects of 

9 the targets and strategies,’’ after ‘‘World 

10 Wide Web’’; and 

11 (D) in subsection (k), by adding at the end 

12 the following: 

13 ‘‘(6) TRANSPORTATION GREENHOUSE GAS RE14 DUCTION EFFORTS.— 

15 ‘‘(A) IN GENERAL.—Within a metropolitan 

16 planning area serving a transportation manage17 ment area, the transportation planning process 

18 under this section shall address transportation19 related greenhouse gas emissions by including 

20 emission reduction targets and strategies to 

21 meet those targets. 

22 ‘‘(B) ELIGIBLE ORGANIZATIONS.— 

23 ‘‘(i) IN GENERAL.—The requirements 

24 of the transportation greenhouse gas re25 duction efforts shall apply only to metroVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00040 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 politan planning organizations within a 

2 transportation management area. 

3 ‘‘(ii) DEVELOPMENT OF PLAN.—A 

4 metropolitan planning organization that 

5 does not serve as a transportation manage6 ment area— 

7 ‘‘(I) may develop transportation 

8 greenhouse gas emission reduction 

9 targets and strategies to meet those 

10 targets; and 

11 ‘‘(II) if those targets and strate12 gies are developed, shall be subject to 

13 all provisions and requirements of this 

14 section, including requirements of the 

15 transportation greenhouse gas reduc16 tion efforts. 

17 ‘‘(C) ESTABLISHMENT OF TARGETS AND

18 CRITERIA.— 

19 ‘‘(i) IN GENERAL.—Not later than 2 

20 years after the promulgation of the final 

21 regulations required under section 831 of 

22 the Clean Air Act, each metropolitan plan23 ning organization shall develop surface 

24 transportation-related greenhouse gas 

25 emission reduction targets, as well as 


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1 strategies to meet those targets, in con2 sultation with State air agencies as part of 

3 the metropolitan transportation planning 

4 process under this section. 

5 ‘‘(ii) MULTIPLE DESIGNATIONS.—If 

6 more than 1 metropolitan planning organi7 zation has been designated within a metro8 politan area, each metropolitan planning 

9 organization shall coordinate with other 

10 metropolitan planning organizations in the 

11 same metropolitan area to develop the tar12 gets and strategies described in clause (i). 

13 ‘‘(iii) MINIMUM REQUIREMENTS.— 

14 Each metropolitan transportation plan de15 veloped by a metropolitan planning organi16 zation under clause (i) shall, within the 

17 plan, demonstrate progress in stabilizing 

18 and reducing transportation-related green19 house gas emissions so as to contribute to 

20 the achievement of State targets pursuant 

21 to section 135(f)(9) of title 23. 

22 ‘‘(iv) REQUIREMENTS FOR TARGETS

23 AND STRATEGIES.—The targets and strat24 egies developed under this subparagraph 

25 shall, at a minimum— 


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1 ‘‘(I) be based on the emission 

2 models and related methodologies es3 tablished in the final regulations re4 quired under section 831 of the Clean 

5 Air Act; 

6 ‘‘(II) inventory all sources of sur7 face transportation-related greenhouse 

8 gas emissions; 

9 ‘‘(III) apply to those modes of 

10 surface transportation that are ad11 dressed in the planning process under 

12 this section; 

13 ‘‘(IV) be integrated and con14 sistent with regional transportation 

15 plans and transportation improvement 

16 programs; and 

17 ‘‘(V) be selected through scenario 

18 analysis (as defined in section 134(k) 

19 of title 23), and include, pursuant to 

20 the requirements of the transportation 

21 planning process under this section, 

22 transportation investment and man23 agement strategies that reduce green24 house gas emissions from the transVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00043 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 portation sector over the life of the 

2 plan, such as— 

3 ‘‘(aa) efforts to increase 

4 public transportation ridership, 

5 including through service im6 provements, capacity expansions, 

7 and access enhancement; 

8 ‘‘(bb) efforts to increase 

9 walking, bicycling, and other 

10 forms of nonmotorized transpor11 tation; 

12 ‘‘(cc) implementation of zon13 ing and other land use regula14 tions and plans to support infill, 

15 transit-oriented development, re16 development, or mixed use devel17 opment; 

18 ‘‘(dd) travel demand man19 agement programs (including 

20 carpool, vanpool, or car-share 

21 projects), transportation pricing 

22 measures, parking policies, and 

23 programs to promote telecom24 muting, flexible work schedules, 

25 and satellite work centers; 


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1 ‘‘(ee) surface transportation 

2 system operation improvements, 

3 including intelligent transpor4 tation systems or other oper5 ational improvements to reduce 

6 long-term greenhouse gas emis7 sions through reduced congestion 

8 and improved system manage9 ment; 

10 ‘‘(ff) intercity passenger rail 

11 improvements; 

12 ‘‘(gg) intercity bus improve13 ments; 

14 ‘‘(hh) freight rail improve15 ments; 

16 ‘‘(ii) use of materials or 

17 equipment associated with the 

18 construction or maintenance of 

19 transportation projects that re20 duce greenhouse gas emissions; 

21 ‘‘(jj) public facilities for sup22 plying electricity to electric or 

23 plug-in hybrid-electric vehicles; or 

24 ‘‘(kk) any other effort that 

25 demonstrates progress in reducVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00045 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 ing transportation-related green2 house gas emissions in each met3 ropolitan planning organization 

4 under this subsection. 

5 ‘‘(D) REVIEW AND APPROVAL.—Not later 

6 than 180 days after the date of submission of 

7 a plan under this section— 

8 ‘‘(i) the Secretary and the Adminis9 trator shall review the plan; and 

10 ‘‘(ii) the Secretary shall approve a 

11 plan developed by a metropolitan planning 

12 organization pursuant to subparagraph (C) 

13 if— 

14 ‘‘(I) the Secretary finds that a 

15 metropolitan planning organization 

16 has developed, submitted, and pub17 lished the plan of the metropolitan 

18 planning organization pursuant to this 

19 section; 

20 ‘‘(II) the Secretary, in consulta21 tion with the Administrator, deter22 mines that the plan is likely to achieve 

23 the targets established by the metro24 politan planning organization under 

25 this subsection; and 


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1 ‘‘(III) the development of the 

2 plan complies with the minimum re3 quirements established under clauses 

4 (iii) and (iv) of subparagraph (C). 

5 ‘‘(E) CERTIFICATION.—Failure to comply 

6 with the requirements under subparagraph (C) 

7 shall not impact certification standards under 

8 paragraph (5). 

9 ‘‘(7) DEFINITION OF METROPOLITAN PLANNING

10 ORGANIZATION.—In this subsection, the term ‘met11 ropolitan planning organization’ means a metropoli12 tan planning organization described in clause (i) or 

13 (ii) of paragraph (6)(B).’’. 

14 (c) STATES.— 

15 (1) TITLE 23.—Section 135 of title 23, United 

16 States Code, is amended— 

17 (A) in subsection (d)(1)(E)— 

18 (i) by inserting ‘‘sustainability, and 

19 livability, reduce surface transportation-re20 lated greenhouse gas emissions and reli21 ance on oil, adapt to the effects of climate 

22 change,’’ after ‘‘energy conservation,’’; 

23 (ii) by inserting ‘‘and public health’’ 

24 after ‘‘quality of life’’; and 


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1 (iii) by inserting ‘‘, including housing 

2 and land use patterns’’ after ‘‘development 

3 patterns’’; and 

4 (B) in subsection (f)— 

5 (i) in paragraph (2)(D)(i)— 

6 (I) by striking ‘‘, as appropriate, 

7 in consultation’’ and inserting ‘‘in co8 operation’’; 

9 (II) by inserting ‘‘State and local 

10 agencies responsible for transpor11 tation, public transportation, air qual12 ity, and housing and in consultation 

13 with’’ before ‘‘State, tribal’’; and 

14 (III) by inserting ‘‘public 

15 health,’’ after ‘‘conservation,’’; 

16 (ii) in paragraph (3)(B)(iii), by insert17 ing ‘‘and through the website of the State, 

18 including emission reduction targets and 

19 strategies developed under paragraph (9) 

20 and an analysis of the anticipated effects 

21 of the targets and strategies’’ after ‘‘World 

22 Wide Web’’; and 

23 (iii) by adding at the end the fol24 lowing: 


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1 ‘‘(9) TRANSPORTATION GREENHOUSE GAS RE2 DUCTION EFFORTS.— 

3 ‘‘(A) IN GENERAL.—Within a State, the 

4 transportation planning process under this sec5 tion, shall address transportation-related green6 house gas emissions by including emission re7 duction targets and strategies to meet those 

8 targets. 

9 ‘‘(B) ESTABLISHMENT OF TARGETS AND

10 CRITERIA.— 

11 ‘‘(i) IN GENERAL.—Not later than 2 

12 years after the promulgation of the final 

13 regulations required under section 831 of 

14 the Clean Air Act, each State shall develop 

15 surface transportation-related greenhouse 

16 gas emission reduction targets, as well as 

17 strategies to meet those targets, in con18 sultation with State air agencies as part of 

19 the transportation planning process under 

20 this section. 

21 ‘‘(ii) MINIMUM REQUIREMENTS.— 

22 Each transportation plan developed by a 

23 State under clause (i) shall, within the 

24 plan, demonstrate progress in stabilizing 

25 and reducing transportation-related greenVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00049 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 house gas emissions in the State so as to 

2 contribute to the achievement of national 

3 targets pursuant to section 831(a)(1) of 

4 the Clean Air Act. 

5 ‘‘(iii) REQUIREMENTS FOR TARGETS

6 AND STRATEGIES.—The targets and strat7 egies developed under this subparagraph 

8 shall, at a minimum— 

9 ‘‘(I) be based on the emission 

10 models and related methodologies es11 tablished in the final regulations re12 quired under section 831 of the Clean 

13 Air Act; 

14 ‘‘(II) inventory all sources of sur15 face transportation-related greenhouse 

16 gas emissions; 

17 ‘‘(III) apply to those modes of 

18 surface transportation that are ad19 dressed in the planning process under 

20 this section; 

21 ‘‘(IV) be integrated and con22 sistent with statewide transportation 

23 plans and statewide transportation 

24 improvement programs; and 


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1 ‘‘(V) be selected through scenario 

2 analysis (as defined in section 

3 134(k)), and include, pursuant to the 

4 requirements of the transportation 

5 planning process under this section, 

6 transportation investment and man7 agement strategies that reduce green8 house gas emissions from the trans9 portation sector over the life of the 

10 plan, such as— 

11 ‘‘(aa) efforts to increase 

12 public transportation ridership, 

13 including through service im14 provements, capacity expansions, 

15 and access enhancement; 

16 ‘‘(bb) efforts to increase 

17 walking, bicycling, and other 

18 forms of nonmotorized transpor19 tation; 

20 ‘‘(cc) implementation of zon21 ing and other land use regula22 tions and plans to support infill, 

23 transit-oriented development, re24 development, or mixed use devel25 opment; 


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1 ‘‘(dd) travel demand man2 agement programs (including 

3 carpool, vanpool, or car-share 

4 projects), transportation pricing 

5 measures, parking policies, and 

6 programs to promote telecom7 muting, flexible work schedules, 

8 and satellite work centers; 

9 ‘‘(ee) surface transportation 

10 system operation improvements, 

11 including intelligent transpor12 tation systems or other oper13 ational improvements to reduce 

14 congestion and improve system 

15 management; 

16 ‘‘(ff) intercity passenger rail 

17 improvements; 

18 ‘‘(gg) intercity bus improve19 ments; 

20 ‘‘(hh) freight rail improve21 ments; 

22 ‘‘(ii) use of materials or 

23 equipment associated with the 

24 construction or maintenance of 


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1 transportation projects that re2 duce greenhouse gas emissions; 

3 ‘‘(jj) public facilities for sup4 plying electricity to electric or 

5 plug-in hybrid-electric vehicles; or 

6 ‘‘(kk) any other effort that 

7 demonstrates progress in reduc8 ing transportation-related green9 house gas emissions. 

10 ‘‘(C) COORDINATION AND CONSULTATION

11 WITH PUBLIC AGENCIES.—Transportation 

12 greenhouse gas targets and plans pursuant to 

13 this section shall be developed— 

14 ‘‘(i) in coordination with— 

15 ‘‘(I) all metropolitan planning or16 ganizations covered by this section 

17 within the State; and 

18 ‘‘(II) transportation and air qual19 ity agencies within the State; and 

20 ‘‘(ii) in consultation with representa21 tives of State and local housing, economic 

22 development, and land use agencies. 

23 ‘‘(D) ENFORCEMENT.—Not later than 180 

24 days after the date of submission of a plan 

25 under this section— 


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1 ‘‘(i) the Secretary and the Adminis2 trator shall review the plan; and 

3 ‘‘(ii) the Secretary shall approve a 

4 plan developed by a State pursuant to sub5 paragraph (B) if— 

6 ‘‘(I) the Secretary finds that a 

7 State has developed, submitted, and 

8 published the plan pursuant to this 

9 section; 

10 ‘‘(II) the Secretary, in consulta11 tion with the Administrator, deter12 mines that the plan is likely to achieve 

13 the targets established by the State 

14 under this subsection; and 

15 ‘‘(III) the development of the 

16 plan complies with the minimum re17 quirements established under clauses 

18 (ii) and (iii) of subparagraph (B). 

19 ‘‘(E) PLANNING FINDING.—Failure to 

20 comply with the requirements under subpara21 graph (B) shall not impact the planning finding 

22 under subsection (g)(7).’’. 

23 (2) TITLE 49.—Section 5304 of title 49, United 

24 States Code is amended— 

25 (A) in subsection (d)(1)(E)— 


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1 (i) by inserting ‘‘sustainability, and 

2 livability, reduce surface transportation-re3 lated greenhouse gas emissions and reli4 ance on oil, adapt to the effects of climate 

5 change,’’ after ‘‘energy conservation,’’; 

6 (ii) by inserting ‘‘and public health’’ 

7 after ‘‘quality of life’’; and 

8 (iii) by inserting ‘‘, including housing 

9 and land use patterns’’ after ‘‘development 

10 patterns’’; and 

11 (B) in subsection (f)— 

12 (i) in paragraph (2)(D)(i)— 

13 (I) by striking ‘‘, as appropriate, 

14 in consultation’’ and inserting ‘‘in co15 operation’’; 

16 (II) by inserting ‘‘State and local 

17 agencies responsible for transpor18 tation, public transportation, air qual19 ity, and housing and in consultation 

20 with’’ before ‘‘State, tribal’’; and 

21 (III) by inserting ‘‘public 

22 health,’’ after ‘‘conservation,’’; 

23 (ii) in paragraph (3)(B)(iii), by insert24 ing ‘‘and through the website of the State, 

25 including emission reduction targets and 


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1 strategies developed under paragraph (9) 

2 and an analysis of the anticipated effects 

3 of the targets and strategies’’ after ‘‘World 

4 Wide Web’’; and 

5 (iii) by adding at the end the fol6 lowing: 

7 ‘‘(9) TRANSPORTATION GREENHOUSE GAS RE8 DUCTION EFFORTS.— 

9 ‘‘(A) IN GENERAL.—Within a State, the 

10 transportation planning process under this sec11 tion, shall address transportation-related green12 house gas emissions by including emission re13 duction targets and strategies to meet those 

14 targets. 

15 ‘‘(B) ESTABLISHMENT OF TARGETS AND

16 CRITERIA.— 

17 ‘‘(i) IN GENERAL.—Not later than 2 

18 years after the promulgation of the final 

19 regulations required under section 831 of 

20 the Clean Air Act, each State shall develop 

21 surface transportation-related greenhouse 

22 gas emission reduction targets, as well as 

23 strategies to meet those targets, in con24 sultation with State air agencies as part of 


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1 the transportation planning process under 

2 this section. 

3 ‘‘(ii) MINIMUM REQUIREMENTS.— 

4 Each transportation plan developed by a 

5 State under clause (i) shall, within the 

6 plan, demonstrate progress in stabilizing 

7 and reducing transportation-related green8 house gas emissions in the State so as to 

9 contribute to the achievement of national 

10 targets pursuant to section 831(a)(1) of 

11 the Clean Air Act. 

12 ‘‘(iii) REQUIREMENTS FOR TARGETS

13 AND STRATEGIES.—The targets and strat14 egies developed under this subparagraph 

15 shall, at a minimum— 

16 ‘‘(I) be based on the emission 

17 models and related methodologies es18 tablished in the final regulations re19 quired under section 831 of the Clean 

20 Air Act; 

21 ‘‘(II) inventory all sources of sur22 face transportation-related greenhouse 

23 gas emissions; 

24 ‘‘(III) apply to those modes of 

25 surface transportation that are adVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00057 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 dressed in the planning process under 

2 this section; 

3 ‘‘(IV) be integrated and con4 sistent with statewide transportation 

5 plans and statewide transportation 

6 improvement programs; and 

7 ‘‘(V) be selected through scenario 

8 analysis (as defined in section 134(k) 

9 of title 23), and include, pursuant to 

10 the requirements of the transportation 

11 planning process under this section, 

12 transportation investment and man13 agement strategies that reduce green14 house gas emissions from the trans15 portation sector over the life of the 

16 plan, such as— 

17 ‘‘(aa) efforts to increase 

18 public transportation ridership, 

19 including through service im20 provements, capacity expansions, 

21 and access enhancement; 

22 ‘‘(bb) efforts to increase 

23 walking, bicycling, and other 

24 forms of nonmotorized transpor25 tation; 


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1 ‘‘(cc) implementation of zon2 ing and other land use regula3 tions and plans to support infill, 

4 transit-oriented development, re5 development, or mixed use devel6 opment; 

7 ‘‘(dd) travel demand man8 agement programs (including 

9 carpool, vanpool, or car-share 

10 projects), transportation pricing 

11 measures, parking policies, and 

12 programs to promote telecom13 muting, flexible work schedules, 

14 and satellite work centers; 

15 ‘‘(ee) surface transportation 

16 system operation improvements, 

17 including intelligent transpor18 tation systems or other oper19 ational improvements to reduce 

20 congestion and improve system 

21 management; 

22 ‘‘(ff) intercity passenger rail 

23 improvements; 

24 ‘‘(gg) intercity bus improve25 ments; 


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1 ‘‘(hh) freight rail improve2 ments; 

3 ‘‘(ii) use of materials or 

4 equipment associated with the 

5 construction or maintenance of 

6 transportation projects that re7 duce greenhouse gas emissions; 

8 ‘‘(jj) public facilities for sup9 plying electricity to electric or 

10 plug-in hybrid-electric vehicles; or 

11 ‘‘(kk) any other effort that 

12 demonstrates progress in reduc13 ing transportation-related green14 house gas emissions. 

15 ‘‘(C) COORDINATION AND CONSULTATION

16 WITH PUBLIC AGENCIES.—Transportation 

17 greenhouse gas targets and plans pursuant to 

18 this section shall be developed— 

19 ‘‘(i) in coordination with— 

20 ‘‘(I) all metropolitan planning or21 ganizations covered by this section 

22 within the State; and 

23 ‘‘(II) transportation and air qual24 ity agencies within the State; and 


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1 ‘‘(ii) in consultation with representa2 tives of State and local housing, economic 

3 development, and land use agencies. 

4 ‘‘(D) ENFORCEMENT.—Not later than 180 

5 days after the date of submission of a plan 

6 under this section— 

7 ‘‘(i) the Secretary and the Adminis8 trator shall review the plan; and 

9 ‘‘(ii) the Secretary shall approve a 

10 plan developed by a State pursuant to sub11 paragraph (B) if— 

12 ‘‘(I) the Secretary finds that a 

13 State has developed, submitted, and 

14 published the plan pursuant to this 

15 section; 

16 ‘‘(II) the Secretary, in consulta17 tion with the Administrator, deter18 mines that the plan is likely to achieve 

19 the targets established by the State 

20 under this subsection; and 

21 ‘‘(III) the development of the 

22 plan complies with the minimum re23 quirements established under clauses 

24 (ii) and (iii) of subparagraph (B). 


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1 ‘‘(E) PLANNING FINDING.—Failure to 

2 comply with the requirements under subpara3 graph (B) shall not impact the planning finding 

4 under subsection (g)(7).’’. 

5 (d) APPLICABILITY.—Section 304 of the Clean Air 

6 Act (42 U.S.C. 7604) shall not apply to the planning pro7 visions of this section or any amendment made by this 

8 section. 

9 (e) LAND USE AUTHORITY.—Nothing in this section 

10 or an amendment made by this section— 

11 (1) infringes on the existing authority of local 

12 governments to plan or control land use; or 

13 (2) provides or transfers authority over land 

14 use to any other entity. 

15 SEC. 113. TRANSPORTATION GREENHOUSE GAS EMISSION 

16 REDUCTION PROGRAM GRANTS. 

17 Part C of title VIII of the Clean Air Act (as amended 

18 by section 112) is amended by adding at the end the fol19 lowing: 

20 ‘‘SEC. 832. TRANSPORTATION GREENHOUSE GAS EMISSION 

21 REDUCTION PROGRAM GRANTS. 

22 ‘‘(a) IN GENERAL.—The Secretary of Transportation 

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

24 grants to States and metropolitan planning organizations 


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1 to carry out the purposes of this section for each fiscal 

2 year— 

3 ‘‘(1) to support the developing and updating of 

4 transportation greenhouse gas reduction targets and 

5 strategies; and 

6 ‘‘(2) to provide financial assistance to imple7 ment plans approved pursuant to— 

8 ‘‘(A) sections 134(k)(6) and 135(f)(9) of 

9 title 23, United States Code; and 

10 ‘‘(B) sections 5303(k)(6) and 5304(f)(9) of 

11 title 49, United States Code. 

12 ‘‘(b) PLANNING GRANTS.— 

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

14 the Secretary shall allocate not more than 5 percent 

15 of the funds available to carry out this section for 

16 a fiscal year for metropolitan planning organizations 

17 to develop and update transportation plans, includ18 ing targets and strategies for greehouse gas emission 

19 reduction under— 

20 ‘‘(A) sections 134(k)(6) and 135(f)(9) of 

21 title 23, United States Code; and 

22 ‘‘(B) sections 5303(k)(6) and 5304(f)(9) of 

23 title 49, United States Code. 

24 ‘‘(2) ELIGIBLE ORGANIZATIONS.—The Sec25 retary shall distribute the funds available in (1) to 


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1 metropolitan planning organizations (as defined in 

2 section 134(k)(7) of title 23, United States Code) in 

3 the proportion that— 

4 ‘‘(A) the population within such a metro5 politan planning organization; bears to 

6 ‘‘(B) the total population of all such met7 ropolitan planning organizations. 

8 ‘‘(c) PERFORMANCE GRANTS.— 

9 ‘‘(1) IN GENERAL.—After allocating funds pur10 suant to subsection (b)(1), the Secretary shall use 

11 the remainder of amounts made available to carry 

12 out this section to provide grants to States and met13 ropolitan planning organizations. 

14 ‘‘(2) CRITERIA.—In providing grants under this 

15 subsection, the Secretary, in consultation with the 

16 Administrator, shall develop criteria for providing 

17 the grants, taking into consideration, with respect to 

18 areas to be covered by the grants— 

19 ‘‘(A) the quantity of total greenhouse gas 

20 emissions to be reduced as a result of imple21 mentation of a plan, within a covered area, as 

22 determined by methods established under sec23 tion 831(a); 

24 ‘‘(B) the quantity of total greenhouse gas 

25 emissions to be reduced per capita as a result 


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1 of implementation of a plan, within the covered 

2 area, as determined by methods established 

3 under section 831(a); 

4 ‘‘(C) the cost-effectiveness of reducing 

5 greenhouse gas emissions during the life of the 

6 plan; 

7 ‘‘(D) progress toward achieving emission 

8 reductions target established under— 

9 ‘‘(i) sections 134(k)(6) and 135(f)(9) 

10 of title 23, United States Code; and 

11 ‘‘(ii) sections 5303(k)(6) and 

12 5304(f)(9) of title 49, United States Code; 

13 ‘‘(E) reductions in greenhouse gas emis14 sions previously achieved by States and metro15 politan planning organizations during the 5- 

16 year period beginning on the date of enactment 

17 of this Act; 

18 ‘‘(F) plans that increase transportation op19 tions and mobility, particularly for low-income 

20 individuals, minorities, the elderly, households 

21 without motor vehicles, cost-burdened house22 holds, and the disabled; and 

23 ‘‘(G) other factors, including innovative ap24 proaches, minimization of costs, and consider25 ation of economic development, revenue generaVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00065 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 tion, consumer fuel cost-savings, and other eco2 nomic, environmental and health benefits, as 

3 the Secretary determines to be appropriate. 

4 ‘‘(d) REQUIREMENT FOR REDUCED EMISSIONS.—A 

5 performance grant under subsection (c) may be used only 

6 to fund strategies that demonstrate a reduction in green7 house gas emissions that is sustainable over the life of the 

8 applicable transportation plan. 

9 ‘‘(e) COST-SHARING.—The Federal share of the costs 

10 of a project receiving Federal financial assistance under 

11 this section shall be 80 percent. 

12 ‘‘(f) COMPLIANCE WITH APPLICABLE LAWS.— 

13 ‘‘(1) IN GENERAL.—Subject to paragraph (2), a 

14 project receiving funds under this section shall com15 ply with all applicable Federal laws (including regu16 lations), including— 

17 ‘‘(A) subchapter IV of chapter 31 of title 

18 40, United States Code; and 

19 ‘‘(B) applicable requirements of titles 23 

20 and 49, United States Code. 

21 ‘‘(2) ELIGIBILITY.—Project eligibility shall be 

22 determined in accordance with this section. 

23 ‘‘(3) DETERMINATION OF APPLICABLE MODAL

24 REQUIREMENTS.—The Secretary shall— 


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1 ‘‘(A) have the discretion to designate the 

2 specific modal requirements that shall apply to 

3 a project; and 

4 ‘‘(B) be guided by the predominant modal 

5 characteristics of the project in the event that 

6 a project has cross-modal application. 

7 ‘‘(g) ADDITIONAL REQUIREMENTS.— 

8 ‘‘(1) IN GENERAL.—As a condition on the re9 ceipt of financial assistance under this section, the 

10 interests of public transportation employees affected 

11 by the assistance shall be protected under arrange12 ments that the Secretary of Labor determines— 

13 ‘‘(A) to be fair and equitable; and 

14 ‘‘(B) to provide benefits equal to the bene15 fits established under section 5333(b) of title 

16 49, United States Code. 

17 ‘‘(2) WAGES AND BENEFITS.—Laborers and 

18 mechanics employed on projects funded with 

19 amounts made available under this section shall be 

20 paid wages and benefits not less than those deter21 mined by the Secretary of Labor under subchapter 

22 IV of chapter 31 of title 40, United States Code, to 

23 be prevailing in the same locality. 

24 ‘‘(h) MISCELLANEOUS.— 


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1 ‘‘(1) ROAD-USE AND CONGESTION PRICING

2 MEASURES.—All projects funded by amounts made 

3 available under this section shall be eligible to re4 ceive amounts collected through road-use and con5 gestion pricing measures. 

6 ‘‘(2) LIMITATIONS.—The Administrator may 

7 not approve any transportation plan for a project 

8 that would be inconsistent with existing design, pro9 curement, and construction guidelines established by 

10 the Department of Transportation. 

11 ‘‘(3) SUBGRANTEES.—With the approval of the 

12 Secretary, recipients of funding under this section 

13 may enter into agreements providing for the transfer 

14 of funds to noneligible public entities (such as local 

15 governments, air quality agencies, zoning commis16 sions, special districts and transit agencies) that 

17 have statutory responsibility or authority for actions 

18 necessary to implement the strategies pursuant to— 

19 ‘‘(A) sections 134(k)(6) and 135(f)(9) of 

20 title 23, United States Code; and 

21 ‘‘(B) sections 5303(k)(6) and 5304(f)(9) of 

22 title 49, United States Code.’’. 


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1 SEC. 114. SMARTWAY TRANSPORTATION EFFICIENCY PRO2 GRAM. 

3 Part B of title VIII of the Clean Air Act (as amended 

4 by section 111) is amended by adding at the end the fol5 lowing: 

6 ‘‘SEC. 822. SMARTWAY TRANSPORTATION EFFICIENCY PRO7 GRAM. 

8 ‘‘(a) IN GENERAL.—There is established within the 

9 Environmental Protection Agency a SmartWay Transpor10 tation Efficiency Program to quantify, demonstrate, and 

11 promote the benefits of technologies, products, fuels, and 

12 operational strategies that reduce petroleum consumption, 

13 air pollution, and greenhouse gas emissions from the mo14 bile source sector. 

15 ‘‘(b) GENERAL DUTIES.—Under the program estab16 lished under this section, the Administrator shall carry out 

17 each of the following: 

18 ‘‘(1) Development of measurement protocols to 

19 evaluate the energy consumption and greenhouse gas 

20 impacts from technologies and strategies in the mo21 bile source sector, including those for passenger 

22 transport and goods movement. 

23 ‘‘(2) Development of qualifying thresholds for 

24 certifying, verifying, or designating energy-efficient, 

25 low-greenhouse gas SmartWay technologies and 


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1 strategies for each mode of passenger transportation 

2 and goods movement. 

3 ‘‘(3) Development of partnership and recogni4 tion programs to promote best practices and drive 

5 demand for energy-efficient, low-greenhouse gas 

6 transportation performance. 

7 ‘‘(4) Promotion of the availability of, and en8 couragement of the adoption of, SmartWay certified 

9 or verified technologies and strategies, and publica10 tion of the availability of financial incentives, such 

11 as assistance from loan programs and other Federal 

12 and State incentives. 

13 ‘‘(c) SMARTWAY TRANSPORT FREIGHT PARTNER14 SHIP.—The Administrator shall establish a SmartWay 

15 Transport Partnership program with shippers and carriers 

16 of goods to promote energy-efficient, low-greenhouse gas 

17 transportation. In carrying out such partnership, the Ad18 ministrator shall undertake each of the following: 

19 ‘‘(1) Verification of the energy and greenhouse 

20 gas performance of participating freight carriers, in21 cluding those operating rail, trucking, marine, and 

22 other goods movement operations. 

23 ‘‘(2) Publication of a comprehensive energy and 

24 greenhouse gas performance index of freight modes 

25 (including rail, trucking, marine, and other modes of 


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1 transporting goods) and individual freight companies 

2 so that shippers can choose to deliver their goods 

3 more efficiently. 

4 ‘‘(3) Development of tools for— 

5 ‘‘(A) carriers to calculate their energy and 

6 greenhouse gas performance; and 

7 ‘‘(B) shippers to calculate the energy and 

8 greenhouse gas impacts of moving their prod9 ucts and to evaluate the relative impacts from 

10 transporting their goods by different modes and 

11 corporate carriers. 

12 ‘‘(4) Provision of recognition opportunities for 

13 participating shipper and carrier companies dem14 onstrating advanced practices and achieving superior 

15 levels of greenhouse gas performance. 

16 ‘‘(d) IMPROVING FREIGHT GREENHOUSE GAS PER17 FORMANCE DATABASES.—The Administrator shall, in co18 ordination with the Secretary of Commerce and other ap19 propriate agencies, define and collect data on the physical 

20 and operational characteristics of the Nation’s truck popu21 lation, with special emphasis on data related to energy ef22 ficiency and greenhouse gas performance to inform the 

23 performance index published under subsection (c)(2) of 

24 this section, and other means of goods transport as necVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00071 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 essary, at least every 5 years as part of the economic cen2 sus required under title 13, United States Code. 

3 ‘‘(e) ESTABLISHMENT OF FINANCING PROGRAM.— 

4 The Administrator shall establish a SmartWay Financing 

5 Program to competitively award funding to eligible entities 

6 identified by the Administrator in accordance with the 

7 program requirements in subsection (g). 

8 ‘‘(f) PURPOSES.—Under the SmartWay Financing 

9 Program, eligible entities shall— 

10 ‘‘(1) use funds awarded by the Administrator to 

11 provide flexible loan and/or lease terms that increase 

12 approval rates or lower the costs of loans and/or 

13 leases in accordance with guidance developed by the 

14 Administrator; 

15 ‘‘(2) make such loans and/or leases available to 

16 public and private entities for the purpose of adopt17 ing low-greenhouse gas technologies or strategies for 

18 the mobile source sector that are designated by the 

19 Administrator; and 

20 ‘‘(3) use funds provided by the Administrator 

21 for electrification of freight transportation systems 

22 in major national goods movement corridors, giving 

23 priority to electrification of transportation systems 

24 in areas that are gateways for high volumes of inter25 national and national freight transport and require 


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1 substantial criteria pollutant emission reductions in 

2 order to attain national ambient air quality stand3 ards. 

4 ‘‘(g) PROGRAM REQUIREMENTS.—The Administrator 

5 shall determine program design elements and require6 ments, including— 

7 ‘‘(1) the type of financial mechanism with 

8 which to award funding, in the form of grants and/ 

9 or contracts; 

10 ‘‘(2) the designation of eligible entities to re11 ceive funding, such as State, tribal, and local gov12 ernments, regional organizations comprised of gov13 ernmental units, nonprofit organizations, or for-prof14 it companies; 

15 ‘‘(3) criteria for evaluating applications from el16 igible entities, including anticipated— 

17 ‘‘(A) cost-effectiveness of loan or lease pro18 gram on a metric-ton-of-greenhouse gas-saved19 per-dollar basis; and 

20 ‘‘(B) ability to promote the loan or lease 

21 program and associated technologies and strate22 gies to the target audience; and 

23 ‘‘(4) reporting requirements for entities that re24 ceive awards, including— 


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1 ‘‘(A) actual cost-effectiveness and green2 house gas savings from the loan or lease pro3 gram based on a methodology designated by the 

4 Administrator; 

5 ‘‘(B) the total number of applications and 

6 number of approved applications; and 

7 ‘‘(C) terms granted to loan and lease re8 cipients compared to prevailing market prac9 tices and/or rates. 

10 ‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—Such 

11 sums as necessary are authorized to be appropriated to 

12 the Administrator to carry out this section.’’. 

13 Subtitle B—Carbon Capture and 

14 Sequestration 

15 SEC. 121. NATIONAL STRATEGY. 

16 (a) IN GENERAL.—Not later than 1 year after the 

17 date of enactment of this Act, the Administrator, in con18 sultation with the Secretary of Energy, the Secretary of 

19 the Interior, and the heads of such other relevant Federal 

20 agencies as the President may designate, shall submit to 

21 Congress a report establishing a unified and comprehen22 sive strategy to address the key legal, regulatory, and 

23 other barriers to the commercial-scale deployment of car24 bon capture and storage. 


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1 (b) BARRIERS.—The report under this section 

2 shall— 

3 (1) identify the regulatory, legal, and other 

4 gaps and barriers that— 

5 (A) could be addressed by a Federal agen6 cy using existing statutory authority; 

7 (B) require Federal legislation, if any; or 

8 (C) would be best addressed at the State, 

9 tribal, or regional level; 

10 (2) identify regulatory implementation chal11 lenges, including challenges relating to approval of 

12 State and tribal programs and delegation of author13 ity for permitting; and 

14 (3) recommend rulemakings, Federal legisla15 tion, or other actions that should be taken to further 

16 evaluate and address those barriers. 

17 (c) FINDING.—Congress finds that it is in the public 

18 interest to achieve widespread, commercial-scale deploy19 ment of carbon capture and storage in the United States 

20 and throughout Asia before January 1, 2030. 

21 SEC. 122. REGULATIONS FOR GEOLOGICAL SEQUESTRA22 TION SITES. 

23 (a) COORDINATED CERTIFICATION AND PERMITTING

24 PROCESS.—Part A of title VIII of the Clean Air Act (as 


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1 amended by section 124 of this division) is amended by 

2 adding at the end the following: 

3 ‘‘SEC. 813. GEOLOGICAL STORAGE SITES. 

4 ‘‘(a) COORDINATED PROCESS.— 

5 ‘‘(1) IN GENERAL.—The Administrator shall es6 tablish a coordinated approach to certifying and per7 mitting geological storage, taking into consideration 

8 all relevant statutory authorities. 

9 ‘‘(2) REQUIREMENTS.—In establishing such ap10 proach, the Administrator shall— 

11 ‘‘(A) take into account, and reduce redun12 dancy with, the requirements of section 1421 of 

13 the Safe Drinking Water Act (42 U.S.C. 300h), 

14 including the rulemaking for geological storage 

15 wells described in the proposed rule entitled 

16 ‘Federal Requirements Under the Underground 

17 Injection Control (UIC) Program for Carbon 

18 Dioxide (CO2) Geologic Sequestration (GS) 

19 Wells’ (73 Fed. Reg. 43492 (July 25, 2008)); 

20 and 

21 ‘‘(B) to the maximum extent practicable, 

22 reduce the burden on certified entities and im23 plementing authorities. 

24 ‘‘(b) REGULATIONS.—Not later than 2 years after 

25 the date of enactment of this title, the Administrator shall 


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1 promulgate regulations to protect human health and the 

2 environment by minimizing the risk of escape to the at3 mosphere of carbon dioxide injected for purposes of geo4 logical storage. 

5 ‘‘(c) REQUIREMENTS.—The regulations under sub6 section (b) shall include— 

7 ‘‘(1) a process to obtain certification for geo8 logical storage under this section; and 

9 ‘‘(2) requirements for— 

10 ‘‘(A) monitoring, recordkeeping, and re11 porting for emissions associated with injection 

12 into, and escape from, geological storage sites, 

13 taking into account any requirements or proto14 cols developed under section 713; 

15 ‘‘(B) public participation in the certifi16 cation process that maximizes transparency; 

17 ‘‘(C) the sharing of data among States, In18 dian tribes, and the Environmental Protection 

19 Agency; and 

20 ‘‘(D) other elements or safeguards nec21 essary to achieve the purpose described in sub22 section (b). 

23 ‘‘(d) REPORT.— 

24 ‘‘(1) IN GENERAL.—Not later than 2 years 

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1 ant to subsection (b), and not less frequently than 

2 once every 3 years thereafter, the Administrator 

3 shall submit to the Committee on Energy and Com4 merce of the House of Representatives and the Com5 mittee on Environment and Public Works of the 

6 Senate a report describing geological storage in the 

7 United States, and, to the extent relevant, other 

8 countries in North America. 

9 ‘‘(2) INCLUSIONS.—Each report under para10 graph (1) shall include— 

11 ‘‘(A) data regarding injection, emissions to 

12 the atmosphere, if any, and performance of ac13 tive and closed geological storage sites, includ14 ing those at which enhanced hydrocarbon recov15 ery operations occur; 

16 ‘‘(B) an evaluation of the performance of 

17 relevant Federal environmental regulations and 

18 programs in ensuring environmentally protec19 tive geological storage practices; 

20 ‘‘(C) recommendations on how those pro21 grams and regulations should be improved or 

22 made more effective; and 

23 ‘‘(D) other relevant information.’’. 


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1 (b) SAFE DRINKING WATER ACT STANDARDS.—Sec2 tion 1421 of the Safe Drinking Water Act (42 U.S.C. 

3 300h) is amended by adding at the end the following: 

4 ‘‘(e) CARBON DIOXIDE GEOLOGICAL STORAGE

5 WELLS.— 

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

7 the date of enactment of this subsection, the Admin8 istrator shall promulgate regulations under sub9 section (a) for carbon dioxide geological storage 

10 wells. 

11 ‘‘(2) FINANCIAL RESPONSIBILITY.— 

12 ‘‘(A) IN GENERAL.—The regulations under 

13 paragraph (1) shall include requirements for 

14 maintaining evidence of financial responsibility, 

15 including financial responsibility for emergency 

16 and remedial response, well plugging, site clo17 sure, and post-injection site care. 

18 ‘‘(B) REGULATIONS.—Financial responsi19 bility may be established for carbon dioxide geo20 logical wells in accordance with regulations pro21 mulgated by the Administrator by any 1, or any 

22 combination, of the following: 

23 ‘‘(i) Insurance. 

24 ‘‘(ii) Guarantee. 

25 ‘‘(iii) Trust. 


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1 ‘‘(iv) Standby trust. 

2 ‘‘(v) Surety bond. 

3 ‘‘(vi) Letter of credit. 

4 ‘‘(vii) Qualification as a self-insurer. 

5 ‘‘(viii) Any other method satisfactory 

6 to the Administrator.’’. 

7 SEC. 123. STUDIES AND REPORTS. 

8 (a) STUDY OF LEGAL FRAMEWORK FOR GEOLOGICAL

9 STORAGE SITES.— 

10 (1) ESTABLISHMENT OF TASK FORCE.— 

11 (A) IN GENERAL.—As soon as practicable, 

12 but not later than 180 days after the date of 

13 enactment of this Act, the Administrator shall 

14 establish a task force, to be composed of an 

15 equal number of— 

16 (i) subject matter experts; 

17 (ii) nongovernmental organizations 

18 with expertise regarding environmental pol19 icy; 

20 (iii) academic experts with expertise in 

21 environmental law; 

22 (iv) State and tribal officials with en23 vironmental expertise; 

24 (v) representatives of State and tribal 

25 attorneys general; 


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1 (vi) representatives of the Environ2 mental Protection Agency, the Department 

3 of the Interior, the Department of Energy, 

4 the Department of Transportation, and 

5 other relevant Federal agencies; and 

6 (vii) members of the private sector. 

7 (B) STUDY.—The task force established 

8 under subparagraph (A) shall conduct a study 

9 of— 

10 (i) existing Federal environmental 

11 statutes, State environmental statutes, and 

12 State common law that apply to geological 

13 storage sites for carbon dioxide, including 

14 the ability of those laws to serve as risk 

15 management tools; 

16 (ii) the existing statutory framework, 

17 including Federal and State laws, that 

18 apply to harm and damage to the environ19 ment or public health at closed sites at 

20 which carbon dioxide injection has been 

21 used for enhanced hydrocarbon recovery; 

22 (iii) the statutory framework, environ23 mental health and safety considerations, 

24 implementation issues, and financial impli25 cations of potential models for Federal, 


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1 State, or private sector assumption of li2 abilities and financial responsibilities with 

3 respect to closed geological storage sites; 

4 (iv) private sector mechanisms, includ5 ing insurance and bonding, that may be 

6 available to manage environmental, health, 

7 and safety risks from closed geological 

8 storage sites; and 

9 (v) the subsurface mineral rights, 

10 water rights, and property rights issues as11 sociated with geological storage of carbon 

12 dioxide, including issues specific to Federal 

13 land. 

14 (2) REPORT.—Not later than 18 months after 

15 the date of enactment of this Act, the task force es16 tablished under paragraph (1)(A) shall submit to 

17 Congress a report describing the results of the study 

18 conducted under that paragraph, including any con19 sensus recommendations of the task force. 

20 (b) ENVIRONMENTAL STATUTES.— 

21 (1) STUDY.—The Administrator shall conduct a 

22 study of the means by which, and under what cir23 cumstances, the environmental statutes for which 

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1 bility would apply to carbon dioxide injection and ge2 ological storage activities. 

3 (2) REPORT.—Not later than 1 year after the 

4 date of enactment of this Act, the Administrator 

5 shall submit to Congress a report describing the re6 sults of the study conducted under paragraph (1). 

7 SEC. 124. PERFORMANCE STANDARDS FOR COAL-FUELED 

8 POWER PLANTS. 

9 (a) IN GENERAL.—Part A of title VIII of the Clean 

10 Air Act (as added by section 121 of division B) is amended 

11 by adding at the end the following: 

12 ‘‘SEC. 812. PERFORMANCE STANDARDS FOR NEW COAL13 FIRED POWER PLANTS. 

14 ‘‘(a) DEFINITIONS.—For purposes of this section: 

15 ‘‘(1) COVERED EGU.—The term ‘covered EGU’ 

16 means a utility unit that is required to have a per17 mit under section 503(a) and is authorized under 

18 State or Federal law to derive at least 30 percent of 

19 its annual heat input from coal, petroleum coke, or 

20 any combination of these fuels. 

21 ‘‘(2) INITIALLY PERMITTED.—The term ‘ini22 tially permitted’ means that the owner or operator 

23 has received a preconstruction approval or permit 

24 under this Act, for the covered EGU as a new (not 

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1 peal of such approval or permit has not been ex2 hausted. A subsequent modification of any such ap3 proval or permits, ongoing administrative or court 

4 review, appeals, or challenges, or the existence or 

5 tolling of any time to pursue further review, appeals, 

6 or challenges shall not affect the date on which a 

7 covered EGU is considered to be initially permitted 

8 under this paragraph. 

9 ‘‘(b) STANDARDS.—(1) A covered EGU that is ini10 tially permitted on or after January 1, 2020, shall achieve 

11 an emission limit that is a 65 percent reduction in emis12 sions of the carbon dioxide produced by the unit, as 

13 measured on an annual basis, or meet such more stringent 

14 standard as the Administrator may establish pursuant to 

15 subsection (c). 

16 ‘‘(2) A covered EGU that is initially permitted after 

17 January 1, 2009, and before January 1, 2020, shall, by 

18 the applicable compliance date established under this 

19 paragraph, achieve an emission limit that is a 50 percent 

20 reduction in emissions of the carbon dioxide produced by 

21 the unit, as measured on an annual basis. Compliance 

22 with the requirement set forth in this paragraph shall be 

23 required by the earliest of the following: 

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1 port that there are in commercial operation in the 

2 United States electric generating units or other sta3 tionary sources equipped with carbon capture and 

4 sequestration technology that, in the aggregate— 

5 ‘‘(i) have a total of at least 4 gigawatts of 

6 nameplate generating capacity of which— 

7 ‘‘(I) at least 3 gigawatts must be elec8 tric generating units; and 

9 ‘‘(II) up to 1 gigawatt may be indus10 trial applications, for which capture and 

11 sequestration of 3,000,000 tons of carbon 

12 dioxide per year on an aggregate 

13 annualized basis shall be considered equiv14 alent to 1 gigawatt; 

15 ‘‘(ii) include at least 2 electric generating 

16 units, each with a nameplate generating capac17 ity of 250 megawatts or greater, that capture, 

18 inject, and sequester carbon dioxide into geo19 logic formations other than oil and gas fields; 

20 and 

21 ‘‘(iii) are capturing and sequestering in the 

22 aggregate at least 12,000,000 tons of carbon 

23 dioxide per year, calculated on an aggregate 

24 annualized basis. 

25 ‘‘(B) January 1, 2025. 


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1 ‘‘(3) If the deadline for compliance with paragraph 

2 (2) is January 1, 2025, the Administrator may extend the 

3 deadline for compliance by a covered EGU by up to 18 

4 months if the Administrator makes a determination, based 

5 on a showing by the owner or operator of the unit, that 

6 it will be technically infeasible for the unit to meet the 

7 standard by the deadline. The owner or operator must 

8 submit a request for such an extension by no later than 

9 January 1, 2022, and the Administrator shall provide for 

10 public notice and comment on the extension request. 

11 ‘‘(c) REVIEW AND REVISION OF STANDARDS.—Not 

12 later than 2025 and at 5-year intervals thereafter, the Ad13 ministrator shall review the standards for new covered 

14 EGUs under this section and shall, by rule, reduce the 

15 maximum carbon dioxide emission rate for new covered 

16 EGUs to a rate which reflects the degree of emission limi17 tation achievable through the application of the best sys18 tem of emission reduction which (taking into account the 

19 cost of achieving such reduction and any nonair quality 

20 health and environmental impact and energy require21 ments) the Administrator determines has been adequately 

22 demonstrated. 

23 ‘‘(d) REPORTS.—Not later than 18 months after the 

24 date of enactment of this title and semiannually there25 after, the Administrator shall publish a report on the 


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1 nameplate capacity of units (determined pursuant to sub2 section (b)(2)(A)) in commercial operation in the United 

3 States equipped with carbon capture and sequestration 

4 technology, including the information described in sub5 section (b)(2)(A) (including the cumulative generating ca6 pacity to which carbon capture and sequestration retrofit 

7 projects meeting the criteria described in section 

8 775(b)(1)(A)(ii) and (b)(1)(A)(iv)(II) has been applied 

9 and the quantities of carbon dioxide captured and seques10 tered by such projects). 

11 ‘‘(e) REGULATIONS.—Not later than 2 years after the 

12 date of enactment of this title, the Administrator shall 

13 promulgate regulations to carry out the requirements of 

14 this section.’’. 

15 SEC. 125. CARBON CAPTURE AND SEQUESTRATION DEM16 ONSTRATION AND EARLY DEPLOYMENT PRO17 GRAM. 

18 (a) DEFINITIONS.—For purposes of this section: 

19 (1) SECRETARY.—The term ‘‘Secretary’’ means 

20 the Secretary of Energy. 

21 (2) DISTRIBUTION UTILITY.—The term ‘‘dis22 tribution utility’’ means an entity that distributes 

23 electricity directly to retail consumers under a legal, 

24 regulatory, or contractual obligation to do so. 


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1 (3) ELECTRIC UTILITY.—The term ‘‘electric 

2 utility’’ has the meaning provided by section 3 of the 

3 Federal Power Act (16 U.S.C. 796). 

4 (4) FOSSIL FUEL-BASED ELECTRICITY.—The 

5 term ‘‘fossil fuel-based electricity’’ means electricity 

6 that is produced from the combustion of fossil fuels. 

7 (5) FOSSIL FUEL.—The term ‘‘fossil fuel’’ 

8 means coal, petroleum, natural gas or any derivative 

9 of coal, petroleum, or natural gas. 

10 (6) CORPORATION.—The term ‘‘Corporation’’ 

11 means the Carbon Storage Research Corporation es12 tablished in accordance with this section. 

13 (7) QUALIFIED INDUSTRY ORGANIZATION.—The 

14 term ‘‘qualified industry organization’’ means the 

15 Edison Electric Institute, the American Public 

16 Power Association, the National Rural Electric Co17 operative Association, a successor organization of 

18 such organizations, or a group of owners or opera19 tors of distribution utilities delivering fossil fuel20 based electricity who collectively represent at least 

21 20 percent of the volume of fossil fuel-based elec22 tricity delivered by distribution utilities to consumers 

23 in the United States. 

24 (8) RETAIL CONSUMER.—The term ‘‘retail con25 sumer’’ means an end-user of electricity. 


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1 (b) CARBON STORAGE RESEARCH CORPORATION.— 

2 (1) ESTABLISHMENT.— 

3 (A) REFERENDUM.—Qualified industry or4 ganizations may conduct, at their own expense, 

5 a referendum among the owners or operators of 

6 distribution utilities delivering fossil fuel-based 

7 electricity for the creation of a Carbon Storage 

8 Research Corporation. Such referendum shall 

9 be conducted by an independent auditing firm 

10 agreed to by the qualified industry organiza11 tions. Voting rights in such referendum shall be 

12 based on the quantity of fossil fuel-based elec13 tricity delivered to consumers in the previous 

14 calendar year or other representative period as 

15 determined by the Secretary pursuant to sub16 section (f). Upon approval of those persons rep17 resenting two-thirds of the total quantity of fos18 sil fuel-based electricity delivered to retail con19 sumers, the Corporation shall be established un20 less opposed by the State regulatory authorities 

21 pursuant to subparagraph (B). All distribution 

22 utilities voting in the referendum shall certify to 

23 the independent auditing firm the quantity of 

24 fossil fuel-based electricity represented by their 

25 vote. 


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1 (B) STATE REGULATORY AUTHORITIES.— 

2 Upon its own motion or the petition of a quali3 fied industry organization, each State regu4 latory authority shall consider its support or op5 position to the creation of the Corporation 

6 under subparagraph (A). State regulatory au7 thorities may notify the independent auditing 

8 firm referred to in subparagraph (A) of their 

9 views on the creation of the Corporation within 

10 180 days after the date of enactment of this 

11 Act. If 40 percent or more of the State regu12 latory authorities submit to the independent au13 diting firm written notices of opposition, the 

14 Corporation shall not be established notwith15 standing the approval of the qualified industry 

16 organizations as provided in subparagraph (A). 

17 (2) TERMINATION.—The Corporation shall be 

18 authorized to collect assessments and conduct oper19 ations pursuant to this section for a 10-year period 

20 from the date 6 months after the date of enactment 

21 of this Act. After such 10-year period, the Corpora22 tion is no longer authorized to collect assessments 

23 and shall be dissolved on the date 15 years after 

24 such date of enactment, unless the period is ex25 tended by an Act of Congress. 


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1 (3) GOVERNANCE.—The Corporation shall oper2 ate as a division or affiliate of the Electric Power 

3 Research Institute (referred to in this section as 

4 ‘‘EPRI’’) and be managed by a Board of not more 

5 than 15 voting members responsible for its oper6 ations, including compliance with this section. EPRI, 

7 in consultation with the Edison Electric Institute, 

8 the American Public Power Association and the Na9 tional Rural Electric Cooperative Association shall 

10 appoint the Board members under clauses (i), (ii), 

11 and (iii) of subparagraph (A) from among can12 didates recommended by those organizations. At 

13 least a majority of the Board members appointed by 

14 EPRI shall be representatives of distribution utilities 

15 subject to assessments under subsection (d). 

16 (A) MEMBERS.—The Board shall include 

17 at least 1 representative of each of the fol18 lowing: 

19 (i) Investor-owned utilities. 

20 (ii) Utilities owned by a State agency, 

21 a municipality, and an Indian tribe. 

22 (iii) Rural electric cooperatives. 

23 (iv) Fossil fuel producers. 

24 (v) Nonprofit environmental organiza25 tions. 


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1 (vi) Independent generators or whole2 sale power providers. 

3 (vii) Consumer groups. 

4 (viii) The National Energy Tech5 nology laboratory of the Department of 

6 Energy. 

7 (ix) The Environmental Protection 

8 Agency. 

9 (B) NONVOTING MEMBERS.—The Board 

10 shall also include as additional nonvoting Mem11 bers the Secretary of Energy or his designee 

12 and 2 representatives of State regulatory au13 thorities as defined in section 3 of the Public 

14 Utility Regulatory Policies Act of 1978 (16 

15 U.S.C. 2602), each designated by the National 

16 Association of State Regulatory Utility Com17 missioners from States that are not within the 

18 same transmission interconnection. 

19 (4) COMPENSATION.—Corporation Board mem20 bers shall receive no compensation for their services, 

21 nor shall Corporation Board members be reimbursed 

22 for expenses relating to their service. 

23 (5) TERMS.—Corporation Board members shall 

24 serve terms of 4 years and may serve not more than 

25 2 full consecutive terms. Members filling unexpired 


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1 terms may serve not more than a total of 8 consecu2 tive years. Former members of the Corporation 

3 Board may be reappointed to the Corporation Board 

4 if they have not been members for a period of 2 

5 years. Initial appointments to the Corporation Board 

6 shall be for terms of 1, 2, 3, and 4 years, staggered 

7 to provide for the selection of 3 members each year. 

8 (6) STATUS OF CORPORATION.—The Corpora9 tion shall not be considered to be an agency, depart10 ment, or instrumentality of the United States, and 

11 no officer or director or employee of the Corporation 

12 shall be considered to be an officer or employee of 

13 the United States Government, for purposes of title 

14 5 or title 31 of the United States Code, or for any 

15 other purpose, and no funds of the Corporation shall 

16 be treated as public money for purposes of chapter 

17 33 of title 31, United States Code, or for any other 

18 purpose. 

19 (c) FUNCTIONS AND ADMINISTRATION OF THE COR20 PORATION.— 

21 (1) IN GENERAL.—The Corporation shall estab22 lish and administer a program to accelerate the com23 mercial availability of carbon dioxide capture and 

24 storage technologies and methods, including tech25 nologies which capture and store, or capture and 


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1 convert, carbon dioxide. Under such program com2 petitively awarded grants, contracts, and financial 

3 assistance shall be provided and entered into with el4 igible entities. Except as provided in paragraph (8), 

5 the Corporation shall use all funds derived from as6 sessments under subsection (d) to issue grants and 

7 contracts to eligible entities. 

8 (2) PURPOSE.—The purposes of the grants, 

9 contracts, and assistance under this subsection shall 

10 be to support commercial-scale demonstrations of 

11 carbon capture or storage technology projects capa12 ble of advancing the technologies to commercial 

13 readiness. Such projects should encompass a range 

14 of different coal and other fossil fuel varieties, be 

15 geographically diverse, involve diverse storage media, 

16 and employ capture or storage, or capture and con17 version, technologies potentially suitable either for 

18 new or for retrofit applications. The Corporation 

19 shall seek, to the extent feasible, to support at least 

20 5 commercial-scale demonstration projects inte21 grating carbon capture and sequestration or conver22 sion technologies. 

23 (3) ELIGIBLE ENTITIES.—Entities eligible for 

24 grants, contracts or assistance under this subsection 

25 may include distribution utilities, electric utilities 


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1 and other private entities, academic institutions, na2 tional laboratories, Federal research agencies, State 

3 and tribal research agencies, nonprofit organizations, 

4 or consortiums of 2 or more entities. Pilot-scale and 

5 similar small-scale projects are not eligible for sup6 port by the Corporation. Owners or developers of 

7 projects supported by the Corporation shall, where 

8 appropriate, share in the costs of such projects. 

9 Projects supported by the Corporation shall meet the 

10 eligibility criteria of section 780(b) of the Clean Air 

11 Act. 

12 (4) GRANTS FOR EARLY MOVERS.—Fifty per13 cent of the funds raised under this section shall be 

14 provided in the form of grants to electric utilities 

15 that had, prior to the award of any grant under this 

16 section, committed resources to deploy a large scale 

17 electricity generation unit with integrated carbon 

18 capture and sequestration or conversion applied to a 

19 substantial portion of the unit’s carbon dioxide emis20 sions. Grant funds shall be provided to defray costs 

21 incurred by such electricity utilities for at least 5 

22 such electricity generation units. 

23 (5) ADMINISTRATION.—The members of the 

24 Board of Directors of the Corporation shall elect a 

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1 tablish committees and subcommittees of the Cor2 poration, and shall adopt rules and bylaws for the 

3 conduct of business and the implementation of this 

4 section. The Board shall appoint an Executive Di5 rector and professional support staff who may be 

6 employees of the Electric Power Research Institute 

7 (EPRI). After consultation with the Technical Advi8 sory Committee established under subsection (j), the 

9 Secretary, and the Director of the National Energy 

10 Technology Laboratory to obtain advice and rec11 ommendations on plans, programs, and project selec12 tion criteria, the Board shall establish priorities for 

13 grants, contracts, and assistance; publish requests 

14 for proposals for grants, contracts, and assistance; 

15 and award grants, contracts, and assistance competi16 tively, on the basis of merit, after the establishment 

17 of procedures that provide for scientific peer review 

18 by the Technical Advisory Committee. The Board 

19 shall give preference to applications that reflect the 

20 best overall value and prospect for achieving the 

21 purposes of the section, such as those which dem22 onstrate an integrated approach for capture and 

23 storage or capture and conversion technologies. The 

24 Board members shall not participate in making 


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1 grants or awards to entities with whom they are af2 filiated. 

3 (6) USES OF GRANTS, CONTRACTS, AND ASSIST4 ANCE.—A grant, contract, or other assistance pro5 vided under this subsection may be used to purchase 

6 carbon dioxide when needed to conduct tests of car7 bon dioxide storage sites, in the case of established 

8 projects that are storing carbon dioxide emissions, or 

9 for other purposes consistent with the purposes of 

10 this section. The Corporation shall make publicly 

11 available at no cost information learned as a result 

12 of projects which it supports financially. 

13 (7) INTELLECTUAL PROPERTY.—The Board 

14 shall establish policies regarding the ownership of in15 tellectual property developed as a result of Corpora16 tion grants and other forms of technology support. 

17 Such policies shall encourage individual ingenuity 

18 and invention. 

19 (8) ADMINISTRATIVE EXPENSES.—Up to 5 per20 cent of the funds collected in any fiscal year under 

21 subsection (d) may be used for the administrative 

22 expenses of operating the Corporation (not including 

23 costs incurred in the determination and collection of 

24 the assessments pursuant to subsection (d)). 


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1 (9) PROGRAMS AND BUDGET.—Before August 1 

2 each year, the Corporation, after consulting with the 

3 Technical Advisory Committee and the Secretary 

4 and the Director of the Department’s National En5 ergy Technology Laboratory and other interested 

6 parties to obtain advice and recommendations, shall 

7 publish for public review and comment its proposed 

8 plans, programs, project selection criteria, and 

9 projects to be funded by the Corporation for the 

10 next calendar year. The Corporation shall also pub11 lish for public review and comment a budget plan for 

12 the next calendar year, including the probable costs 

13 of all programs, projects, and contracts and a rec14 ommended rate of assessment sufficient to cover 

15 such costs. The Secretary may recommend programs 

16 and activities the Secretary considers appropriate. 

17 The Corporation shall include in the first publication 

18 it issues under this paragraph a strategic plan or 

19 roadmap for the achievement of the purposes of the 

20 Corporation, as set forth in paragraph (2). 

21 (10) RECORDS; AUDITS.—The Corporation shall 

22 keep minutes, books, and records that clearly reflect 

23 all of the acts and transactions of the Corporation 

24 and make public such information. The books of the 

25 Corporation shall be audited by a certified public acVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00098 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 countant at least once each fiscal year and at such 

2 other times as the Corporation may designate. Cop3 ies of each audit shall be provided to the Congress, 

4 all Corporation board members, all qualified indus5 try organizations, each State regulatory authority 

6 and, upon request, to other members of the industry. 

7 If the audit determines that the Corporation’s prac8 tices fail to meet generally accepted accounting prin9 ciples the assessment collection authority of the Cor10 poration under subsection (d) shall be suspended 

11 until a certified public accountant renders a subse12 quent opinion that the failure has been corrected. 

13 The Corporation shall make its books and records 

14 available for review by the Secretary or the Comp15 troller General of the United States. 

16 (11) PUBLIC ACCESS.—The Corporation 

17 Board’s meetings shall be open to the public and 

18 shall occur after at least 30 days advance public no19 tice. Meetings of the Board of Directors may be 

20 closed to the public where the agenda of such meet21 ings includes only confidential matters pertaining to 

22 project selection, the award of grants or contracts, 

23 personnel matters, or the receipt of legal advice. The 

24 minutes of all meetings of the Corporation shall be 


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1 made available to and readily accessible by the pub2 lic. 

3 (12) ANNUAL REPORT.—Each year the Cor4 poration shall prepare and make publicly available a 

5 report which includes an identification and descrip6 tion of all programs and projects undertaken by the 

7 Corporation during the previous year. The report 

8 shall also detail the allocation or planned allocation 

9 of Corporation resources for each such program and 

10 project. The Corporation shall provide its annual re11 port to the Congress, the Secretary, each State regu12 latory authority, and upon request to the public. The 

13 Secretary shall, not less than 60 days after receiving 

14 such report, provide to the President and Congress 

15 a report assessing the progress of the Corporation in 

16 meeting the objectives of this section. 

17 (d) ASSESSMENTS.— 

18 (1) AMOUNT.—(A) In all calendar years fol19 lowing its establishment, the Corporation shall col20 lect an assessment on distribution utilities for all 

21 fossil fuel-based electricity delivered directly to retail 

22 consumers (as determined under subsection (f)). The 

23 assessments shall reflect the relative carbon dioxide 

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1 tricity, and initially shall be not less than the fol2 lowing amounts for coal, natural gas, and oil: 

Fuel type Rate of assessment 

per kilowatt hour 

Coal ................................................................... $0.00043 

Natural Gas ...................................................... $0.00022 

Oil ..................................................................... $0.00032. 

3 (B) The Corporation is authorized to adjust the 

4 assessments on fossil fuel-based electricity to reflect 

5 changes in the expected quantities of such electricity 

6 from different fuel types, such that the assessments 

7 generate not less than $1.0 billion and not more 

8 than $1.1 billion annually. The Corporation is au9 thorized to supplement assessments through addi10 tional financial commitments. 

11 (2) INVESTMENT OF FUNDS.—Pending dis12 bursement pursuant to a program, plan, or project, 

13 the Corporation may invest funds collected through 

14 assessments under this subsection, and any other 

15 funds received by the Corporation, only in obliga16 tions of the United States or any agency thereof, in 

17 general obligations of any State or any political sub18 division thereof, in any interest-bearing account or 

19 certificate of deposit of a bank that is a member of 

20 the Federal Reserve System, or in obligations fully 

21 guaranteed as to principal and interest by the 

22 United States. 


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1 (3) REVERSION OF UNUSED FUNDS.—If the 

2 Corporation does not disburse, dedicate or assign 75 

3 percent or more of the available proceeds of the as4 sessed fees in any calendar year 7 or more years fol5 lowing its establishment, due to an absence of quali6 fied projects or similar circumstances, it shall reim7 burse the remaining undedicated or unassigned bal8 ance of such fees, less administrative and other ex9 penses authorized by this section, to the distribution 

10 utilities upon which such fees were assessed, in pro11 portion to their collected assessments. 

12 (e) ERCOT.— 

13 (1) ASSESSMENT, COLLECTION, AND REMIT14 TANCE.—(A) Notwithstanding any other provision of 

15 this section, within ERCOT, the assessment pro16 vided for in subsection (d) shall be— 

17 (i) levied directly on qualified scheduling 

18 entities, or their successor entities; 

19 (ii) charged consistent with other charges 

20 imposed on qualified scheduling entities as a fee 

21 on energy used by the load-serving entities; and 

22 (iii) collected and remitted by ERCOT to 

23 the Corporation in the amounts and in the 

24 same manner as set forth in subsection (d). 


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1 (B) The assessment amounts referred to in sub2 paragraph (A) shall be— 

3 (i) determined by the amount and types of 

4 fossil fuel-based electricity delivered directly to 

5 all retail customers in the prior calendar year 

6 beginning with the year ending immediately 

7 prior to the period described in subsection 

8 (b)(2); and 

9 (ii) take into account the number of renew10 able energy credits retired by the load-serving 

11 entities represented by a qualified scheduling 

12 entity within the prior calendar year. 

13 (2) ADMINISTRATION EXPENSES.—Up to 1 per14 cent of the funds collected in any fiscal year by 

15 ERCOT under the provisions of this subsection may 

16 be used for the administrative expenses incurred in 

17 the determination, collection and remittance of the 

18 assessments to the Corporation. 

19 (3) AUDIT.—ERCOT shall provide a copy of its 

20 annual audit pertaining to the administration of the 

21 provisions of this subsection to the Corporation. 

22 (4) DEFINITIONS.—For the purposes of this 

23 subsection: 

24 (A) The term ‘‘ERCOT’’ means the Elec25 tric Reliability Council of Texas. 


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1 (B) The term ‘‘load-serving entities’’ has 

2 the meaning adopted by ERCOT Protocols and 

3 in effect on the date of enactment of this Act. 

4 (C) The term ‘‘qualified scheduling enti5 ties’’ has the meaning adopted by ERCOT Pro6 tocols and in effect on the date of enactment of 

7 this Act. 

8 (D) The term ‘‘renewable energy credit’’ 

9 has the meaning as promulgated and adopted 

10 by the Public Utility Commission of Texas pur11 suant to section 39.904(b) of the Public Utility 

12 Regulatory Act of 1999, and in effect on the 

13 date of enactment of this Act. 

14 (f) DETERMINATION OF FOSSIL FUEL-BASED ELEC15 TRICITY DELIVERIES.— 

16 (1) FINDINGS.—The Congress finds that: 

17 (A) The assessments under subsection (d) 

18 are to be collected based on the amount of fossil 

19 fuel-based electricity delivered by each distribu20 tion utility. 

21 (B) Since many distribution utilities pur22 chase all or part of their retail consumer’s elec23 tricity needs from other entities, it may not be 

24 practical to determine the precise fuel mix for 


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1 the power sold by each individual distribution 

2 utility. 

3 (C) It may be necessary to use average 

4 data, often on a regional basis with reference to 

5 Regional Transmission Organization (‘‘RTO’’) 

6 or NERC regions, to make the determinations 

7 necessary for making assessments. 

8 (2) DOE PROPOSED RULE.—The Secretary, 

9 acting in close consultation with the Energy Infor10 mation Administration, shall issue for notice and 

11 comment a proposed rule to determine the level of 

12 fossil fuel electricity delivered to retail customers by 

13 each distribution utility in the United States during 

14 the most recent calendar year or other period deter15 mined to be most appropriate. Such proposed rule 

16 shall balance the need to be efficient, reasonably pre17 cise, and timely, taking into account the nature and 

18 cost of data currently available and the nature of 

19 markets and regulation in effect in various regions 

20 of the country. Different methodologies may be ap21 plied in different regions if appropriate to obtain the 

22 best balance of such factors. 

23 (3) FINAL RULE.—Within 6 months after the 

24 date of enactment of this Act, and after opportunity 

25 for comment, the Secretary shall issue a final rule 


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1 under this subsection for determining the level and 

2 type of fossil fuel-based electricity delivered to retail 

3 customers by each distribution utility in the United 

4 States during the appropriate period. In issuing 

5 such rule, the Secretary may consider opportunities 

6 and costs to develop new data sources in the future 

7 and issue recommendations for the Energy Informa8 tion Administration or other entities to collect such 

9 data. After notice and opportunity for comment the 

10 Secretary may, by rule, subsequently update and 

11 modify the methodology for making such determina12 tions. 

13 (4) ANNUAL DETERMINATIONS.—Pursuant to 

14 the final rule issued under paragraph (3), the Sec15 retary shall make annual determinations of the 

16 amounts and types for each such utility and publish 

17 such determinations in the Federal Register. Such 

18 determinations shall be used to conduct the ref19 erendum under subsection (b) and by the Corpora20 tion in applying any assessment under this sub21 section. 

22 (5) REHEARING AND JUDICIAL REVIEW.—The 

23 owner or operator of any distribution utility that be24 lieves that the Secretary has misapplied the method25 ology in the final rule in determining the amount 


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1 and types of fossil fuel electricity delivered by such 

2 distribution utility may seek rehearing of such deter3 mination within 30 days of publication of the deter4 mination in the Federal Register. The Secretary 

5 shall decide such rehearing petitions within 30 days. 

6 The Secretary’s determinations following rehearing 

7 shall be final and subject to judicial review in the 

8 United States Court of Appeals for the District of 

9 Columbia. 

10 (g) COMPLIANCE WITH CORPORATION ASSESS11 MENTS.—The Corporation may bring an action in the ap12 propriate court of the United States to compel compliance 

13 with an assessment levied by the Corporation under this 

14 section. A successful action for compliance under this sub15 section may also require payment by the defendant of the 

16 costs incurred by the Corporation in bringing such action. 

17 (h) MIDCOURSE REVIEW.—Not later than 5 years 

18 following establishment of the Corporation, the Comp19 troller General of the United States shall prepare an anal20 ysis, and report to Congress, assessing the Corporation’s 

21 activities, including project selection and methods of dis22 bursement of assessed fees, impacts on the prospects for 

23 commercialization of carbon capture and storage tech24 nologies, adequacy of funding, and administration of 

25 funds. The report shall also make such recommendations 


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1 as may be appropriate in each of these areas. The Cor2 poration shall reimburse the Government Accountability 

3 Office for the costs associated with performing this mid4 course review. 

5 (i) RECOVERY OF COSTS.— 

6 (1) IN GENERAL.—A distribution utility whose 

7 transmission, delivery, or sales of electric energy are 

8 subject to any form of rate regulation shall not be 

9 denied the opportunity to recover the full amount of 

10 the prudently incurred costs associated with com11 plying with this section, consistent with applicable 

12 State or Federal law. 

13 (2) RATEPAYER REBATES.—Regulatory authori14 ties that approve cost recovery pursuant to para15 graph (1) may order rebates to ratepayers to the ex16 tent that distribution utilities are reimbursed 

17 undedicated or unassigned balances pursuant to sub18 section (d)(3). 

19 (j) TECHNICAL ADVISORY COMMITTEE.— 

20 (1) ESTABLISHMENT.—There is established an 

21 advisory committee, to be known as the ‘‘Technical 

22 Advisory Committee’’. 

23 (2) MEMBERSHIP.—The Technical Advisory 

24 Committee shall be comprised of not less than 7 

25 members appointed by the Board from among acaVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00108 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 demic institutions, national laboratories, independent 

2 research institutions, and other qualified institu3 tions. No member of the Committee shall be affili4 ated with EPRI or with any organization having 

5 members serving on the Board. At least one member 

6 of the Committee shall be appointed from among of7 ficers or employees of the Department of Energy 

8 recommended to the Board by the Secretary of En9 ergy. 

10 (3) CHAIRPERSON AND VICE CHAIRPERSON.— 

11 The Board shall designate one member of the Tech12 nical Advisory Committee to serve as Chairperson of 

13 the Committee and one to serve as Vice Chairperson 

14 of the Committee. 

15 (4) COMPENSATION.—The Board shall provide 

16 compensation to members of the Technical Advisory 

17 Committee for travel and other incidental expenses 

18 and such other compensation as the Board deter19 mines to be necessary. 

20 (5) PURPOSE.—The Technical Advisory Com21 mittee shall provide independent assessments and 

22 technical evaluations, as well as make non-binding 

23 recommendations to the Board, concerning Corpora24 tion activities, including but not limited to the fol25 lowing: 


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1 (A) Reviewing and evaluating the Corpora2 tion’s plans and budgets described in subsection 

3 (c)(9), as well as any other appropriate areas, 

4 which could include approaches to prioritizing 

5 technologies, appropriateness of engineering 

6 techniques, monitoring and verification tech7 nologies for storage, geological site selection, 

8 and cost control measures. 

9 (B) Making annual non-binding rec10 ommendations to the Board concerning any of 

11 the matters referred to in subparagraph (A), as 

12 well as what types of investments, scientific re13 search, or engineering practices would best fur14 ther the goals of the Corporation. 

15 (6) PUBLIC AVAILABILITY.—All reports, evalua16 tions, and other materials of the Technical Advisory 

17 Committee shall be made available to the public by 

18 the Board, without charge, at time of receipt by the 

19 Board. 

20 (k) LOBBYING RESTRICTIONS.—No funds collected 

21 by the Corporation shall be used in any manner for influ22 encing legislation or elections, except that the Corporation 

23 may recommend to the Secretary and the Congress 

24 changes in this section or other statutes that would fur25 ther the purposes of this section. 


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1 (l) DAVIS-BACON COMPLIANCE.—The Corporation 

2 shall ensure that entities receiving grants, contracts, or 

3 other financial support from the Corporation for the 

4 project activities authorized by this section are in compli5 ance with subchapter IV of chapter 31 of title 40, United 

6 States Code (commonly known as the ‘‘Davis-Bacon 

7 Act’’). 

8 Subtitle C—Nuclear and Advanced 

9 Technologies 

10 SEC. 131. FINDINGS AND POLICY. 

11 (a) FINDINGS.—Congress finds that— 

12 (1) in 2008, 104 nuclear power plants produced 

13 19.6 percent of the electricity generated in the 

14 United States, slightly less than the electricity gen15 erated by natural gas; 

16 (2) nuclear energy is the largest provider of 

17 clean, low-carbon, electricity, almost 8 times larger 

18 than all renewable power production combined, ex19 cluding hydroelectric power; 

20 (3) nuclear energy supplies consistent, base-load 

21 electricity, independent of environmental conditions; 

22 (4) by displacing fossil fuels that would other23 wise be used for electricity production, nuclear power 

24 plants virtually eliminate emissions of greenhouse 


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1 gases and criteria pollutants associated with acid 

2 rain, smog, or ozone; 

3 (5) nuclear power generation continues to re4 quire robust efforts to address issues of safety, 

5 waste, and proliferation; 

6 (6) even if every nuclear plant is granted a 20- 

7 year extension, all currently operating nuclear plants 

8 will be retired by 2055; 

9 (7) long lead times for nuclear power plant con10 struction indicate that action to stimulate the nu11 clear power industry should not be delayed; 

12 (8) the high upfront capital costs of nuclear 

13 plant construction remain a substantial obstacle, de14 spite theoretical potential for significant cost reduc15 tion; 

16 (9) translating theoretical cost reduction poten17 tial into actual reduced construction costs remains a 

18 significant industry challenge that can be overcome 

19 only through demonstrated performance; 

20 (10) as of January 2009, 17 companies and 

21 consortia have submitted applications to the Nuclear 

22 Regulatory Commission for 26 new reactors in the 

23 United States; 

24 (11) those proposed reactors will use the latest 

25 in nuclear technology for efficiency and safety, more 


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1 advanced than the technology of the 1960s and 

2 1970s found in the reactors currently operating in 

3 the United States; 

4 (12) increased resources for the Nuclear Regu5 latory Commission and reform of the licensing proc6 ess have improved the safety and timeliness of the 

7 regulatory environment; 

8 (13) the United States has not built a new re9 actor since the 1970s and, as a result, will need to 

10 revitalize and retool the institutions and infrastruc11 ture necessary to construct, maintain, and support 

12 new reactors, including improvements in manufac13 turing of nuclear components and training for the 

14 next generation nuclear workforce; and 

15 (14) those new reactors will launch a new era 

16 for the nuclear industry, and translate into tens of 

17 thousands of jobs. 

18 (b) STATEMENT OF POLICY.—It is the policy of the 

19 United States, given the importance of transitioning to a 

20 clean energy, low-carbon economy, to facilitate the contin21 ued development and growth of a safe and clean nuclear 

22 energy industry, through— 

23 (1) reductions in financial and technical bar24 riers to construction and operation; and 


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1 (2) incentives for the development of a well2 trained workforce and the growth of safe domestic 

3 nuclear and nuclear-related industries. 

4 SEC. 132. NUCLEAR WORKER TRAINING. 

5 (a) DEFINITION OF APPLICABLE PERIOD.—In this 

6 section, the term ‘‘applicable period’’ means— 

7 (1) the 5-year period beginning on January 1, 

8 2012; and 

9 (2) each 5-year period beginning on each Janu10 ary 1 thereafter. 

11 (b) USE OF FUNDS.—Of amounts made available to 

12 carry out this section for the calendar years in each appli13 cable period— 

14 (1) the Secretary of Energy shall use such 

15 amounts for each applicable period as the Secretary 

16 of Energy determines to be necessary to increase the 

17 number and amounts of nuclear science talent ex18 pansion grants and nuclear science competitiveness 

19 grants provided under section 5004 of the America 

20 COMPETES Act (42 U.S.C. 16532); and 

21 (2) the Secretary of Labor, in consultation with 

22 nuclear energy entities and organized labor, shall 

23 use such amounts for each applicable period as the 

24 Secretary of Labor determines to be necessary to 

25 carry out programs expanding workforce training to 


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1 meet the high demand for workers skilled in nuclear 

2 power plant construction and operation, including 

3 programs for— 

4 (A) electrical craft certification; 

5 (B) preapprenticeship career technical edu6 cation for industrialized skilled crafts that are 

7 useful in the construction of nuclear power 

8 plants; 

9 (C) community college and skill center 

10 training for nuclear power plant technicians; 

11 (D) training of construction management 

12 personnel for nuclear power plant construction 

13 projects; and 

14 (E) regional grants for integrated nuclear 

15 energy workforce development programs. 

16 SEC. 133. NUCLEAR SAFETY AND WASTE MANAGEMENT 

17 PROGRAMS. 

18 (a) NUCLEAR FACILITY LONG-TERM OPERATIONS

19 RESEARCH AND DEVELOPMENT PROGRAM.— 

20 (1) ESTABLISHMENT.—As soon as practicable 

21 after the date of enactment of this Act, the Sec22 retary of Energy (referred to in this section as the 

23 ‘‘Secretary’’) shall establish a research and develop24 ment program— 


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1 (A) to address the reliability, availability, 

2 productivity, component aging, safety, and secu3 rity of nuclear power plants; 

4 (B) to improve the performance of nuclear 

5 power plants; 

6 (C) to sustain the health and safety of em7 ployees of nuclear power plants; 

8 (D) to assess the feasibility of nuclear 

9 power plants to continue to provide clean and 

10 economic electricity safely, substantially beyond 

11 the first license extension period of the nuclear 

12 power plants, which will— 

13 (i) significantly contribute to the en14 ergy security of the United States; and 

15 (ii) help protect the environment of 

16 the United States; and 

17 (E) to support significant carbon reduc18 tions, lower overall costs that are required to 

19 reduce carbon emissions, and increase energy 

20 security. 

21 (2) CONDUCT OF PROGRAM.— 

22 (A) IN GENERAL.—In carrying out the 

23 program established under paragraph (1), the 

24 Secretary shall— 


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1 (i) build a fundamental scientific basis 

2 to understand, predict, and measure 

3 changes in materials, systems, structures, 

4 equipment, and components as the mate5 rials, systems, structures, equipment, and 

6 components age through continued oper7 ations in long-term service environments; 

8 (ii) develop new safety analysis tools 

9 and methods to enhance the performance 

10 and safety of nuclear power plants; 

11 (iii) develop advanced online moni12 toring, control, and diagnostics tech13 nologies to prevent equipment failures and 

14 improve the safety of nuclear power plants; 

15 (iv) establish a technical basis for ad16 vanced fuel designs (including silicon car17 bide fuel cladding) to increase the safety 

18 margins of nuclear power plants; and 

19 (v) examine issues, including— 

20 (I) issues relating to material 

21 degradation, plant aging, and tech22 nology upgrades; and 

23 (II) any other issue that would 

24 impact decisions to extend the lifespan 

25 of nuclear power plants. 


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1 (B) TECHNICAL SUPPORT.—In carrying 

2 out the program established under paragraph 

3 (1), the Secretary shall provide to the Chairman 

4 of the Nuclear Regulatory Commission informa5 tion collected under the program— 

6 (i) to help ensure informed decisions 

7 regarding the extension of the life of nu8 clear power plants beyond a 60-year life9 span; and 

10 (ii) for the licensing and long-term 

11 management, and safe and economical op12 eration, of nuclear power plants. 

13 (b) SPENT NUCLEAR WASTE DISPOSAL RESEARCH

14 AND DEVELOPMENT PROGRAM.— 

15 (1) ESTABLISHMENT.—As soon as practicable 

16 after the date of enactment of this Act, the Sec17 retary shall establish a research and development 

18 program to improve the understanding of nuclear 

19 spent fuel management and the entire nuclear fuel 

20 cycle life. 

21 (2) CONDUCT OF PROGRAM.—In carrying out 

22 the program established under paragraph (1), the 

23 Secretary shall carry out science-based research and 

24 development activities to pursue dramatic improve25 ments in a range of nuclear spent fuel management 


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1 options, including short-term and long-term storage 

2 and disposal, and proliferation-resistant nuclear 

3 spent fuel recycling. 

4 (c) AUTHORIZATION OF APPROPRIATIONS.—There 

5 are authorized to be appropriated such sums as are nec6 essary to carry out this section. 

7 Subtitle D—Water Efficiency 

8 SEC. 141. WATERSENSE. 

9 (a) IN GENERAL.—There is established within the 

10 Environmental Protection Agency a WaterSense program 

11 to identify and promote water-efficient products, build12 ings, landscapes, facilities, processes, and services, so as— 

13 (1) to reduce water use; 

14 (2) to reduce the strain on water, wastewater, 

15 and stormwater infrastructure; 

16 (3) to conserve energy used to pump, heat, 

17 transport, and treat water; and 

18 (4) to preserve water resources for future gen19 erations, through voluntary labeling of, or other 

20 forms of communications about, products, buildings, 

21 landscapes, facilities, processes, and services that 

22 meet the highest water efficiency and performance 

23 criteria. 

24 (b) DUTIES.—The Administrator shall— 

25 (1) establish— 


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1 (A) a WaterSense label to be used for cer2 tain items; and 

3 (B) the procedure by which an item may 

4 be certified to display the WaterSense label; 

5 (2) promote WaterSense-labeled products, 

6 buildings, landscapes, facilities, processes, and serv7 ices in the market place as the preferred tech8 nologies and services for— 

9 (A) reducing water use; and 

10 (B) ensuring product and service perform11 ance; 

12 (3) work to enhance public awareness of the 

13 WaterSense label through public outreach, edu14 cation, and other means; 

15 (4) preserve the integrity of the WaterSense 

16 label by— 

17 (A) establishing and maintaining perform18 ance criteria so that products, buildings, land19 scapes, facilities, processes, and services labeled 

20 with the WaterSense label perform as well or 

21 better than less water-efficient counterparts; 

22 (B) overseeing WaterSense certifications 

23 made by third parties; 

24 (C) conducting reviews of the use of the 

25 WaterSense label in the marketplace and taking 


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1 corrective action in any case in which misuse of 

2 the label is identified; and 

3 (D) carrying out such other measures as 

4 the Administrator determines to be appropriate; 

5 (5) regularly review and, if appropriate, update 

6 WaterSense criteria for categories of products, build7 ings, landscapes, facilities, processes, and services, 

8 at least once every 4 years; 

9 (6) to the maximum extent practicable, regu10 larly estimate and make available to the public the 

11 production and relative market shares of, and the 

12 savings of water, energy, and capital costs of water, 

13 wastewater, and stormwater infrastructure attrib14 utable to the use of WaterSense-labeled products, 

15 buildings, landscapes, facilities, processes, and serv16 ices, at least annually; 

17 (7) solicit comments from interested parties and 

18 the public prior to establishing or revising a 

19 WaterSense category, specification, installation cri20 terion, or other criterion (or prior to effective dates 

21 for any such category, specification, installation cri22 terion, or other criterion); 

23 (8) provide reasonable notice to interested par24 ties and the public of any changes (including effec25 tive dates), on the adoption of a new or revised catVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00121 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 egory, specification, installation criterion, or other 

2 criterion, along with— 

3 (A) an explanation of the changes; and 

4 (B) as appropriate, responses to comments 

5 submitted by interested parties and the public; 

6 (9) provide appropriate lead time (as deter7 mined by the Administrator) prior to the applicable 

8 effective date for a new or significant revision to a 

9 category, specification, installation criterion, or other 

10 criterion, taking into account the timing require11 ments of the manufacturing, marketing, training, 

12 and distribution process for the specific product, 

13 building and landscape, or service category ad14 dressed; 

15 (10) identify and, if appropriate, implement 

16 other voluntary approaches in commercial, institu17 tional, residential, industrial, and municipal sectors 

18 to encourage recycling and reuse technologies to im19 prove water efficiency or lower water use; and 

20 (11) where appropriate, apply the WaterSense 

21 label to water-using products that are labeled by the 

22 Energy Star program implemented by the Adminis23 trator and the Secretary of Energy. 


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1 (c) AUTHORIZATION OF APPROPRIATIONS.—There 

2 are authorized to be appropriated to carry out this sec3 tion— 

4 (1) $7,500,000 for fiscal year 2010; 

5 (2) $10,000,000 for fiscal year 2011; 

6 (3) $20,000,000 for fiscal year 2012; 

7 (4) $50,000,000 for fiscal year 2013; and 

8 (5) for each subsequent fiscal year, the applica9 ble amount during the preceding fiscal year, as ad10 justed to reflect changes for the 12-month period 

11 ending the preceding November 30 in the Consumer 

12 Price Index for All Urban Consumers published by 

13 the Bureau of Labor Statistics of the Department of 

14 Labor. 

15 SEC. 142. FEDERAL PROCUREMENT OF WATER-EFFICIENT 

16 PRODUCTS. 

17 (a) DEFINITIONS.—In this section: 

18 (1) AGENCY.—The term ‘‘Agency’’ has the 

19 meaning given the term in section 7902(a) of title 

20 5, United States Code. 

21 (2) FEMP-DESIGNATED PRODUCT.—The term 

22 ‘‘FEMP-designated product’’ means a product that 

23 is designated under the Federal Energy Manage24 ment Program of the Department of Energy as 


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1 being among the highest 25 percent of equivalent 

2 products for efficiency. 

3 (3) PRODUCT, BUILDING, LANDSCAPE, FACIL4 ITY, PROCESS, AND SERVICE.—The terms ‘‘product’’, 

5 ‘‘building’’, ‘‘landscape’’, ‘‘facility’’, ‘‘process’’, and 

6 ‘‘service’’ do not include— 

7 (A) any water-using product, building, 

8 landscape, facility, process, or service designed 

9 or procured for combat or combat-related mis10 sions; or 

11 (B) any product, building, landscape, facil12 ity, process, or service already covered by the 

13 Federal procurement regulations established 

14 under section 553 of the National Energy Con15 servation Policy Act (42 U.S.C. 8259b). 

16 (4) WATERSENSE PRODUCT, BUILDING, LAND17 SCAPE, FACILITY, PROCESS, OR SERVICE.—The term 

18 ‘‘WaterSense product, building, landscape, facility, 

19 process, or service’’ means a product, building, land20 scape, facility, process, or service that is labeled for 

21 water efficiency under the WaterSense program. 

22 (5) WATERSENSE PROGRAM.—The term 

23 ‘‘WaterSense program’’ means the program estab24 lished by section 141. 


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1 (b) PROCUREMENT OF WATER-EFFICIENT PROD2 UCTS.— 

3 (1) REQUIREMENT.— 

4 (A) IN GENERAL.—To meet the require5 ments of an agency for a water-using product, 

6 building, landscape, facility, process, or service, 

7 the head of an Agency shall, except as provided 

8 in paragraph (2), procure— 

9 (i) a WaterSense product, building, 

10 landscape, facility, process, or service; or 

11 (ii) a FEMP-designated product. 

12 (B) SENSE OF CONGRESS REGARDING IN13 STALLATION PREFERENCES.—It is the sense of 

14 Congress that a WaterSense irrigation system 

15 should, to the maximum extent practicable, be 

16 installed and audited by a WaterSense-certified 

17 irrigation professional to ensure optimal per18 formance. 

19 (2) EXCEPTIONS.—The head of an Agency shall 

20 not be required to procure a WaterSense product, 

21 building, landscape, facility, process, or service or 

22 FEMP-designated product under paragraph (1) if 

23 the head of the Agency finds in writing that— 

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1 ignated product is not cost-effective over the life 

2 of the product, building, landscape, facility, 

3 process, or service, taking energy, water, and 

4 wastewater service cost savings into account; or 

5 (B) no WaterSense product, building, land6 scape, facility, process, or service or FEMP-des7 ignated product is reasonably available that 

8 meets the functional requirements of the Agen9 cy. 

10 (3) PROCUREMENT PLANNING.— 

11 (A) IN GENERAL.—The head of an Agency 

12 shall incorporate criteria used for evaluating 

13 WaterSense products, buildings, landscapes, fa14 cilities, processes, and services and FEMP-des15 ignated products into— 

16 (i) the specifications for all procure17 ments involving water-using products, 

18 buildings, landscapes, facilities, processes, 

19 and systems, including guide specifications, 

20 project specifications, and construction, 

21 renovation, and services contracts that in22 clude provision of water-using products, 

23 buildings, landscapes, facilities, processes, 

24 and systems; and 


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1 (ii) the factors for the evaluation of 

2 offers received for the procurement. 

3 (B) LISTING OF WATER-EFFICIENT PROD4 UCTS IN FEDERAL CATALOGS.—WaterSense 

5 products, buildings, landscapes, facilities, proc6 esses, and systems and FEMP-designated prod7 ucts shall be clearly identified and prominently 

8 displayed in any inventory or listing of products 

9 by the General Services Administration or the 

10 Defense Logistics Agency. 

11 (C) ADDITIONAL MEASURES.—The head of 

12 an Agency shall consider, to the maximum ex13 tent practicable, additional measures for reduc14 ing Agency water use, including water reuse 

15 technologies, leak detection and repair, and use 

16 of waterless products that perform similar func17 tions to existing water-using products. 

18 (c) RETROFIT PROGRAMS.—The head of each Agen19 cy, working in coordination with the Administrator and 

20 the heads of such other Agencies as the President may 

21 designate, shall develop standards and implementation 

22 procedures for a building water efficiency retrofit pro23 gram, which shall include the following elements: 

24 (1) EVALUATION OF PRODUCTS AND SYS25 TEMS.—Not later than 270 days after the date of 


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1 enactment of this Act, each Agency shall evaluate 

2 water-consuming products and systems in buildings 

3 operated by such Agency and identify opportunities 

4 for retrofit and replacement of such products and 

5 systems with high-efficiency equipment, such as 

6 zero-water-consumption equipment, high-efficiency 

7 toilets, high-efficiency shower heads, and high-effi8 ciency faucets, and other products that are certified 

9 as Watersense products or FEMP-designated prod10 ucts. 

11 (2) RETROFIT PLAN.—Not later than 360 days 

12 after the date of enactment of this Act, each Agency 

13 shall, in coordination with other appropriate Agen14 cies and officials, prepare a water efficiency retrofit 

15 plan that shall, to the maximum extent practicable, 

16 maximize retrofitting of water-consuming products 

17 and systems and replacement with high-efficiency 

18 equipment described in paragraph (1). 

19 (d) GUIDELINES.—Not later than 180 days after the 

20 date of enactment of this Act, the Administrator, working 

21 in coordination with the Secretary of Energy and the 

22 heads of such other Agencies as the President may des23 ignate, shall issue guidelines to carry out this section. 


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1 SEC. 143. STATE RESIDENTIAL WATER EFFICIENCY AND 

2 CONSERVATION INCENTIVES PROGRAM. 

3 (a) DEFINITIONS.—In this section: 

4 (1) ELIGIBLE ENTITY.—The term ‘‘eligible enti5 ty’’ means a State government, local or county gov6 ernment, tribal government, wastewater or sewerage 

7 utility, municipal water authority, energy utility, 

8 water utility, or nonprofit organization that meets 

9 the requirements of subsection (b). 

10 (2) INCENTIVE PROGRAM.—The term ‘‘incentive 

11 program’’ means a program for administering finan12 cial incentives for consumer purchase and installa13 tion of water-efficient products, buildings (including 

14 New Water-Efficient Homes), landscapes, processes, 

15 or services described in subsection (b)(1). 

16 (3) RESIDENTIAL WATER-EFFICIENT PRODUCT, 

17 BUILDING, LANDSCAPE, PROCESS, OR SERVICE.— 

18 (A) IN GENERAL.—The term ‘‘residential 

19 water-efficient product, building, landscape, 

20 process, or service’’ means a product, building, 

21 landscape, process, or service for a residence or 

22 its landscape that is rated for water efficiency 

23 and performance— 

24 (i) by the WaterSense program; or 

25 (ii) if a WaterSense specification does 

26 not exist, by the Energy Star program or 


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1 an incentive program approved by the Ad2 ministrator. 

3 (B) INCLUSIONS.—The term ‘‘residential 

4 water-efficient product, building, landscape, 

5 process, or service’’ includes— 

6 (i) faucets; 

7 (ii) irrigation technologies and serv8 ices; 

9 (iii) point-of-use water treatment de10 vices; 

11 (iv) reuse and recycling technologies; 

12 (v) toilets; 

13 (vi) clothes washers; 

14 (vii) dishwashers; 

15 (viii) showerheads; 

16 (ix) xeriscaping and other landscape 

17 conversions that replace irrigated turf; and 

18 (x) New Water Efficient Homes cer19 tified by the WaterSense program. 

20 (4) WATERSENSE PROGRAM.—The term 

21 ‘‘WaterSense program’’ means the program estab22 lished by section 141. 

23 (b) ELIGIBLE ENTITIES.—An entity shall be eligible 

24 to receive an allocation under subsection (c) if the entity— 


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1 (1) establishes (or has established) an incentive 

2 program to provide financial incentives to residential 

3 consumers for the purchase of residential water-effi4 cient products, buildings, landscapes, processes, or 

5 services; 

6 (2) submits an application for the allocation at 

7 such time, in such form, and containing such infor8 mation as the Administrator may require; and 

9 (3) provides assurances satisfactory to the Ad10 ministrator that the entity will use the allocation to 

11 supplement, but not supplant, funds made available 

12 to carry out the incentive program. 

13 (c) AMOUNT OF ALLOCATIONS.—For each fiscal year, 

14 the Administrator shall determine the amount to allocate 

15 to each eligible entity to carry out subsection (d), taking 

16 into consideration— 

17 (1) the population served by the eligible entity 

18 during the most recent calendar year for which data 

19 are available; 

20 (2) the targeted population of the incentive pro21 gram of the eligible entity, such as general house22 holds, low-income households, or first-time home23 owners, and the probable effectiveness of the incen24 tive program for that population; 


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1 (3) for existing programs, the effectiveness of 

2 the program in encouraging the adoption of water3 efficient products, buildings, landscapes, facilities, 

4 processes, and services; 

5 (4) any allocation to the eligible entity for a 

6 preceding fiscal year that remains unused; and 

7 (5) the per capita water demand of the popu8 lation served by the eligible entity during the most 

9 recent calendar year for which data are available 

10 and the accessibility of water supplies to such entity. 

11 (d) USE OF ALLOCATED FUNDS.—Funds allocated to 

12 an eligible entity under subsection (c) may be used to pay 

13 up to 50 percent of the cost of establishing and carrying 

14 out an incentive program. 

15 (e) FIXTURE RECYCLING.—Eligible entities are en16 couraged to promote or implement fixture recycling pro17 grams to manage the disposal of older fixtures replaced 

18 due to the incentive program under this section. 

19 (f) ISSUANCE OF INCENTIVES.— 

20 (1) IN GENERAL.—Financial incentives may be 

21 provided to residential consumers that meet the re22 quirements of the applicable incentive program. 

23 (2) MANNER OF ISSUANCE.—An eligible entity 

24 may— 


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1 (A) issue all financial incentives directly to 

2 residential consumers; or 

3 (B) with approval of the Administrator, 

4 delegate all or part of financial incentive admin5 istration to other organizations, including local 

6 governments, municipal water authorities, water 

7 utilities, and non-profit organizations. 

8 (3) AMOUNT.—The amount of a financial in9 centive shall be determined by the eligible entity, 

10 taking into consideration— 

11 (A) the amount of any Federal or State in12 centive available for the purchase of the resi13 dential water-efficient product or service; 

14 (B) the amount necessary to change con15 sumer behavior to purchase water-efficient 

16 products and services; and 

17 (C) the consumer expenditures for onsite 

18 preparation, assembly, and original installation 

19 of the product. 

20 (g) AUTHORIZATION OF APPROPRIATIONS.—There 

21 are authorized to be appropriated to the Administrator to 

22 carry out this section— 

23 (1) $100,000,000 for fiscal year 2010; 

24 (2) $150,000,000 for fiscal year 2011; 

25 (3) $200,000,000 for fiscal year 2012; 


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1 (4) $150,000,000 for fiscal year 2013; 

2 (5) $100,000,000 for fiscal year 2014; and 

3 (6) for each subsequent fiscal year, the applica4 ble amount during the preceding fiscal year, as ad5 justed to reflect changes for the 12-month period 

6 ending the preceding November 30 in the Consumer 

7 Price Index for All Urban Consumers published by 

8 the Bureau of Labor Statistics of the Department of 

9 Labor. 

10 Subtitle E—Miscellaneous 

11 SEC. 151. OFFICE OF CONSUMER ADVOCACY. 

12 (a) OFFICE.— 

13 (1) ESTABLISHMENT.—There is established an 

14 Office of Consumer Advocacy to serve as an advo15 cate for the public interest. 

16 (2) DIRECTOR.—The Office shall be headed by 

17 a Director to be appointed by the President, who is 

18 admitted to the Federal Bar, with experience in pub19 lic utility proceedings, and by and with the advice 

20 and consent of the Senate. 

21 (3) DUTIES.—The Office may— 

22 (A) represent, and appeal on behalf of, en23 ergy customers on matters concerning rates or 

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1 panies under the jurisdiction of the Commis2 sion— 

3 (i) at hearings of the Commission; 

4 (ii) in judicial proceedings in the 

5 courts of the United States; and 

6 (iii) at hearings or proceedings of 

7 other Federal regulatory agencies and com8 missions; 

9 (B) monitor and review energy customer 

10 complaints and grievances on matters con11 cerning rates or service of public utilities and 

12 natural gas companies under the jurisdiction of 

13 the Commission; 

14 (C) investigate independently, or within the 

15 context of formal proceedings, the services pro16 vided by, the rates charged by, and the valu17 ation of the properties of, public utilities and 

18 natural gas companies under the jurisdiction of 

19 the Commission; 

20 (D) develop means, such as public dissemi21 nation of information, consultative services, and 

22 technical assistance, to ensure, to the maximum 

23 extent practicable, that the interests of energy 

24 consumers are adequately represented in the 


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1 course of any hearing or proceeding described 

2 in subparagraph (A); 

3 (E) collect data concerning rates or service 

4 of public utilities and natural gas companies 

5 under the jurisdiction of the Commission; and 

6 (F) prepare and issue reports and rec7 ommendations. 

8 (4) COMPENSATION AND POWERS.—The Direc9 tor may— 

10 (A) employ and fix the compensation of 

11 such staff personnel as is deemed necessary; 

12 and 

13 (B) procure temporary and intermittent 

14 services as needed. 

15 (5) ACCESS TO INFORMATION.—Each depart16 ment, agency, and instrumentality of the Federal 

17 Government is authorized and directed to furnish to 

18 the Director such reports and other information as 

19 he deems necessary to carry out his functions under 

20 this section. 

21 (b) CONSUMER ADVOCACY ADVISORY COMMITTEE.— 

22 (1) ESTABLISHMENT.—The Director shall es23 tablish an advisory committee to be known as Con24 sumer Advocacy Advisory Committee (in this section 

25 referred to as the ‘‘Advisory Committee’’) to review 


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1 rates, services, and disputes and to make rec2 ommendations to the Director. 

3 (2) COMPOSITION.—The Director shall appoint 

4 5 members to the Advisory Committee including— 

5 (A) 2 individuals representing State Utility 

6 Consumer Advocates; and 

7 (B) 1 individual, from a nongovernmental 

8 organization, representing consumers. 

9 (3) MEETINGS.—The Advisory Committee shall 

10 meet at such frequency as may be required to carry 

11 out its duties. 

12 (4) REPORTS.—The Director shall provide for 

13 publication of recommendations of the Advisory 

14 Committee on the public website established for the 

15 Office. 

16 (5) DURATION.—Notwithstanding any other 

17 provision of law, the Advisory Committee shall con18 tinue in operation during the period in which the Of19 fice exists. 

20 (6) APPLICATION OF FACA.—Except as other21 wise specifically provided, the Advisory Committee 

22 shall be subject to the Federal Advisory Committee 

23 Act. 

24 (c) DEFINITIONS.—In this section: 


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1 (1) COMMISSION.—The term ‘‘Commission’’ 

2 means the Federal Energy Regulatory Commission. 

3 (2) ENERGY CUSTOMER.—The term ‘‘energy 

4 customer’’ means a residential customer or a small 

5 commercial customer that receives products or serv6 ices from a public utility or natural gas company 

7 under the jurisdiction of the Commission. 

8 (3) NATURAL GAS COMPANY.—The term ‘‘nat9 ural gas company’’ has the meaning given the term 

10 in section 2 of the Natural Gas Act (15 U.S.C. 

11 717a). 

12 (4) OFFICE.—The term ‘‘Office’’ means the Of13 fice of Consumer Advocacy established by subsection 

14 (a)(1). 

15 (5) PUBLIC UTILITY.—The term ‘‘public util16 ity’’ has the meaning given the term in section 

17 201(e) of the Federal Power Act (16 U.S.C. 824(e)). 

18 (6) SMALL COMMERCIAL CUSTOMER.—The term 

19 ‘‘small commercial customer’’ means a commercial 

20 customer that has a peak demand of not more than 

21 1,000 kilowatts per hour. 

22 (d) AUTHORIZATION OF APPROPRIATIONS.—There 

23 are authorized such sums as necessary to carry out this 

24 section. 


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1 (e) SAVINGS CLAUSE.—Nothing in this section af2 fects the rights or obligations of State Utility Consumer 

3 Advocates. 

4 SEC. 152. CLEAN TECHNOLOGY BUSINESS COMPETITION 

5 GRANT PROGRAM. 

6 (a) IN GENERAL.—The Administrator may provide 

7 grants to organizations to conduct business competitions 

8 that provide incentives, training, and mentorship to entre9 preneurs and early stage start-up companies throughout 

10 the United States to meet high-priority economic, environ11 mental, and energy goals in areas including air quality, 

12 energy efficiency and renewable energy, transportation, 

13 water quality and conservation, green buildings, and waste 

14 management. 

15 (b) PURPOSES.— 

16 (1) IN GENERAL.—The competitions described 

17 in subsection (a) shall have the purposes of— 

18 (A) accelerating the development and de19 ployment of clean technology businesses and 

20 green jobs; 

21 (B) stimulating green economic develop22 ment; 

23 (C) providing business training and men24 toring to early stage clean technology compa25 nies; and 


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1 (D) strengthening the competitiveness of 

2 United States clean technology industry in 

3 world trade markets. 

4 (2) PRIORITY.—Priority shall be given to busi5 ness competitions that— 

6 (A) are led by the private sector; 

7 (B) encourage regional and interregional 

8 cooperation; and 

9 (C) can demonstrate market-driven prac10 tices and the creation of cost-effective green 

11 jobs through an annual publication of competi12 tion activities and directory of companies. 

13 (c) ELIGIBILITY.— 

14 (1) IN GENERAL.—To be eligible for a grant 

15 under this section, an organization shall be any 

16 sponsored entity of an organization described in sub17 paragraph (A) that is operated as a nonprofit entity. 

18 (2) PRIORITY.—In making grants under this 

19 section, the Administrator shall give priority to orga20 nizations that can demonstrate broad funding sup21 port from private and other non-Federal funding 

22 sources to leverage Federal investment. 

23 (d) AUTHORIZATION OF APPROPRIATIONS.—There is 

24 authorized to be appropriated to carry out this section 

25 $20,000,000. 


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1 SEC. 153. PRODUCT CARBON DISCLOSURE PROGRAM. 

2 (a) EPA STUDY.—The Administrator shall conduct 

3 a study to determine the feasibility of establishing a na4 tional program for measuring, reporting, publicly dis5 closing, and labeling products or materials sold in the 

6 United States for their carbon content, and shall, not later 

7 than 18 months after the date of enactment of this Act, 

8 transmit a report to Congress which shall include the fol9 lowing: 

10 (1) A determination of whether a national prod11 uct carbon disclosure program and labeling program 

12 would be effective in achieving the intended goals of 

13 achieving greenhouse gas reductions and an exam14 ination of existing programs globally and their 

15 strengths and weaknesses. 

16 (2) Criteria for identifying and prioritizing sec17 tors and products and processes that should be cov18 ered in such program or programs. 

19 (3) An identification of products, processes, or 

20 sectors whose inclusion could have a substantial car21 bon impact (prioritizing industrial products such as 

22 iron and steel, aluminum, cement, chemicals, and 

23 paper products, and also including food, beverage, 

24 hygiene, cleaning, household cleaners, construction, 

25 metals, clothing, semiconductor, and consumer elec26 tronics). 


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1 (4) Suggested methodology and protocols for 

2 measuring the carbon content of the products across 

3 the entire carbon lifecycle of such products for use 

4 in a carbon disclosure program and labeling pro5 gram. 

6 (5) A review of existing greenhouse gas product 

7 accounting standards, methodologies, and practices 

8 including the Greenhouse Gas Protocol, ISO 14040/ 

9 44, ISO 14067, and Publically Available Specifica10 tion 2050, and including a review of the strengths 

11 and weaknesses of each. 

12 (6) A survey of secondary databases including 

13 the Manufacturing Energy Consumption Survey, an 

14 evaluation of the quality of data for use in a product 

15 carbon disclosure program and product carbon label16 ing program, an identification of gaps in the data 

17 relative to the potential purposes of a national prod18 uct carbon disclosure program and product carbon 

19 labeling program, and development of recommenda20 tions for addressing these data gaps. 

21 (7) An assessment of the utility of comparing 

22 products and the appropriateness of product carbon 

23 standards. 

24 (8) An evaluation of the information needed on 

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1 cluding what pieces of quantitative and qualitative 

2 information need to be disclosed. 

3 (9) An evaluation of the appropriate boundaries 

4 of the carbon lifecycle analysis for different sectors 

5 and products. 

6 (10) An analysis of whether default values 

7 should be developed for products whose producer 

8 does not participate in the program or does not have 

9 data to support a disclosure or label and a deter10 mination of the best ways to develop such default 

11 values. 

12 (11) A recommendation of certification and 

13 verification options necessary to assure the quality 

14 of the information and avoid greenwashing or the 

15 use of insubstantial or meaningless environmental 

16 claims to promote a product. 

17 (12) An assessment of options for educating 

18 consumers about product carbon content and the 

19 product carbon disclosure program and product car20 bon labeling program. 

21 (13) An analysis of the costs and timelines as22 sociated with establishing a national product carbon 

23 disclosure program and product carbon labeling pro24 gram, including options for a phased approach. 

25 Costs should include those for businesses associated 


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1 with the measurement of carbon footprints and 

2 those associated with creating a product carbon label 

3 and managing and operating a product carbon label4 ing program, and options for minimizing these costs. 

5 (14) An evaluation of incentives (such as finan6 cial incentives, brand reputation, and brand loyalty) 

7 to determine whether reductions in emissions can be 

8 accelerated through encouraging more efficient man9 ufacturing or by encouraging preferences for lower10 emissions products to substitute for higher-emissions 

11 products whose level of performance is no better. 

12 (b) DEVELOPMENT OF NATIONAL CARBON DISCLO13 SURE PROGRAM.—Upon conclusion of the study, and not 

14 later than 3 years after the date of enactment of this Act, 

15 the Administrator shall establish a national product car16 bon disclosure program, participation in which shall be 

17 voluntary, and which may involve a product carbon label 

18 with broad applicability to the wholesale and consumer 

19 markets to enable and encourage knowledge about carbon 

20 content by producers and consumers and to inform efforts 

21 to reduce energy consumption (carbon dioxide equivalent 

22 emissions) nationwide. In developing such a program, the 

23 Administrator shall— 

24 (1) consider the results of the study conducted 

25 under subsection (a); 


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1 (2) consider existing and planned programs and 

2 proposals and measurement standards (including the 

3 Publicly Available Specification 2050, standards to 

4 be developed by the World Resource Institute/World 

5 Business Council for Sustainable Development, the 

6 International Standards Organization, and the bill 

7 AB19 pending in the California legislature as of the 

8 date of enactment of this Act); 

9 (3) consider the compatibility of a national 

10 product carbon disclosure program with existing pro11 grams; 

12 (4) utilize incentives and other means to spur 

13 the adoption of product carbon disclosure and prod14 uct carbon labeling; 

15 (5) develop protocols and parameters for a 

16 product carbon disclosure program, including a 

17 methodology and formula for assessing, verifying, 

18 and potentially labeling a product’s greenhouse gas 

19 content, and for data quality requirements to allow 

20 for product comparison; 

21 (6) create a means to— 

22 (A) document best practices; 

23 (B) ensure clarity and consistency; 

24 (C) work with suppliers, manufacturers, 

25 and retailers to encourage participation; 


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1 (D) ensure that protocols are consistent 

2 and comparable across like products; and 

3 (E) evaluate the effectiveness of the pro4 gram; 

5 (7) make publicly available information on 

6 product carbon content to ensure transparency; 

7 (8) provide for public outreach, including a con8 sumer education program to increase awareness; 

9 (9) develop training and education programs to 

10 help businesses learn how to measure and commu11 nicate their carbon footprint and easy tools and tem12 plates for businesses to use to reduce cost and time 

13 to measure their products’ carbon lifecycle; 

14 (10) consult with the Secretary of Energy, the 

15 Secretary of Commerce, the Federal Trade Commis16 sion, and other Federal agencies, as necessary; 

17 (11) gather input from stakeholders through 

18 consultations, public workshops, or hearings with 

19 representatives of consumer product manufacturers, 

20 consumer groups, and environmental groups; 

21 (12) utilize systems for verification and product 

22 certification that will ensure that claims manufactur23 ers make about their products are valid; 

24 (13) create a process for reviewing the accuracy 

25 of product carbon label information and protecting 


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1 the product carbon label in the case of a change in 

2 the product’s energy source, supply chain, ingredi3 ents, or other factors, and specify the frequency to 

4 which data should be updated; and 

5 (14) develop a standardized, easily understand6 able carbon label, if appropriate, and create a proc7 ess for responding to inaccuracies and misuses of 

8 such a label. 

9 (c) REPORT TO CONGRESS.—Not later than 5 years 

10 after the program is established pursuant to subsection 

11 (b), the Administrator shall report to Congress on the ef12 fectiveness and impact of the program, the level of vol13 untary participation, and any recommendations for addi14 tional measures. 

15 (d) DEFINITIONS.—In this section: 

16 (1) The term ‘‘carbon content’’ means the 

17 quantity of greenhouse gas emissions and the warm18 ing impact of those emissions on the atmosphere ex19 pressed in carbon dioxide equivalent associated with 

20 a product’s value chain. 

21 (2) The term ‘‘carbon footprint’’ means the 

22 level of greenhouse gas emissions produced by a par23 ticular activity, service, or entity. 

24 (3) The term ‘‘carbon lifecycle’’ means the 

25 greenhouse gas emissions that are released as part 


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1 of the processes of creating, producing, processing, 

2 manufacturing, modifying, transporting, distrib3 uting, storing, using, recycling, or disposing of goods 

4 and services. 

5 (e) AUTHORIZATION OF APPROPRIATIONS.—There is 

6 authorized to be appropriated to the Administrator— 

7 (1) to carry out the study required by sub8 section (a), $5,000,000; and 

9 (2) to carry out the program required under 

10 subsection (b), $25,000,000 for each of fiscal years 

11 2010 through 2025. 

12 SEC. 154. STATE RECYCLING PROGRAMS. 

13 (a) ESTABLISHMENT.—The Administrator shall es14 tablish a State Recycling Program governing the use of 

15 funds by States in accordance with this Act. 

16 (b) USE OF FUNDING.— 

17 (1) IN GENERAL.—States receiving funding to 

18 carry out this section shall use the proceeds to carry 

19 out recycling programs in accordance with this sec20 tion. 

21 (2) COUNTY AND MUNICIPAL PROGRAMS.—Not 

less than 1 22 ⁄4 of the funding made available to a State 

23 to carry out this section shall be distributed by the 

24 State to county and municipal recycling programs as 

25 described in subsection (c)(1), to be used exclusively 


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1 to support recycling purposes and associated source 

2 reduction purposes, including to provide incentives— 

3 (A) for recycling-related technology that— 

4 (i) reduces or avoids greenhouse gas 

5 emissions; 

6 (ii) increases collection rates; and 

7 (iii) improves the quality of recyclable 

8 material that is separated from solid 

9 waste; 

10 (B) for energy-efficiency projects for trans11 portation fleets and recycling equipment used to 

12 collect and sort recyclable material separated 

13 from solid waste; 

14 (C) for recycling program-related expenses, 

15 including— 

16 (i) education and job training; 

17 (ii) development and implementation 

18 of variable rate (commonly referred to as 

19 ‘‘pay-as-you-throw’’) recycling programs 

20 and anaerobic digestion programs; 

21 (iii) promotion of public space recy22 cling programs; 

23 (iv) approaches for assuring compli24 ance with recycling requirements; and 


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1 (v) development or implementation of 

2 best practices for municipal solid waste re3 duction programs; and 

4 (D) to ensure that recyclable material is 

5 not sent for disposal or incineration during fluc6 tuating markets. 

(3) RECYCLING FACILITIES.—Not less than 1 7 ⁄4

8 of the funding made available to a State to carry out 

9 this section shall be distributed by the State to eligi10 ble recycling facilities as described in subsection 

11 (c)(2) to be used exclusively to support the recycling 

12 purposes and associated source reduction purposes 

13 of the facilities, including to provide— 

14 (A) incentives for the demonstration or de15 ployment of recycling-related technology and 

16 equipment that reduce or avoid greenhouse gas 

17 emissions; 

18 (B) incentives to facilities that increase the 

19 quantity and quality of recyclable material that 

20 is recycled versus sent for disposal or inciner21 ation; 

22 (C) funding for research, management, 

23 and removal of impediments to recycling, in24 cluding— 

25 (i) radioactive material; and 


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1 (ii) devices or materials that contain 

2 polychlorinated biphenyls, mercury, or 

3 chlorofluorocarbons; 

4 (D) funding for research on, and develop5 ment and deployment of, new technologies to 

6 more efficiently and effectively recycle items 

7 such as automobile shredder residue, cathode 

8 ray tubes, plastics, and tires; and 

9 (E) incentives to recycle materials identi10 fied by the Administrator that are not being re11 cycled at a recycling facility. 

12 (4) MANUFACTURING FACILITIES.—Not less 

than 1 13 ⁄4 of the funding made available to a State to 

14 carry out this section shall be distributed by the 

15 State to eligible manufacturing facilities as described 

16 in subsection (c)(3) to be used exclusively to support 

17 recycling purposes, including to provide incentives 

18 for the demonstration or deployment of— 

19 (A) manufacturing-related technology and 

20 equipment that would increase the use of recy21 clable material and avoid or reduce greenhouse 

22 gas emissions; 

23 (B) radiation detection equipment and the 

24 costs associated with recovery of detected radi25 ated recyclable material; 


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1 (C) technologies that will detect and sepa2 rate contaminants, including mercury-, lead-, 

3 and cadmium-containing devices; 

4 (D) strategies and technologies to remove 

5 impediments to recovering recyclable material; 

6 and 

7 (E) strategies and technologies to improve 

8 the energy efficiency of technology and equip9 ment used to manufacture recyclable material. 

10 (c) ELIGIBILITY REQUIREMENTS.— 

11 (1) COUNTY AND MUNICIPALITY PROGRAMS.— 

12 Funds provided under subsection (b)(2) shall be pro13 vided on a competitive basis to county and municipal 

14 recycling programs that— 

15 (A) have within the solid waste manage16 ment plans of the programs a recycling man17 agement plan that includes an education out18 reach program for the individuals and entities 

19 served by the program constituency that high20 lights the lifecycle benefits of recycling; and 

21 (B) collect at least 5 recyclable materials, 

22 such as— 

23 (i) ferrous and nonferrous metal; 

24 (ii) aluminum; 

25 (iii) plastic; 


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1 (iv) tires and rubber; 

2 (v) household electronic equipment; 

3 (vi) glass; 

4 (vii) scrap food; 

5 (viii) recoverable fiber or paper; and 

6 (ix) textiles; 

7 (C) demonstrate, not later than 3 years 

8 after the date of receipt of funds under this 

9 subtitle, reasonable progress toward achieving— 

10 (i) a collection rate goal of at least 30 

11 percent of the total recyclable materials 

12 available from the solid waste stream in 

13 the requesting State, county, or municipal 

14 program; or 

15 (ii) a 10-percent increase of collected 

16 recyclable materials compared to the total 

17 solid waste stream in the requesting State, 

18 county, or municipal program; and 

19 (D)(i) own, operate, or contract to oper20 ate— 

21 (I) a curbside recyclables collection 

22 program; 

23 (II) a redemption center or drop-off 

24 facility for recyclables; and 

25 (III) a materials recovery facility; and 


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1 (ii) have in place a quality, environmental, 

2 health, and safety management system (such as 

3 that of the International Standards Organiza4 tion or an equivalent) that includes goals to re5 duce the operational carbon baselines of the 

6 programs. 

7 (2) RECYCLING FACILITY.—Funds provided 

8 under subsection (b)(3) shall be provided on a com9 petitive basis to a recycling facility that— 

10 (A) processes recyclable material into com11 mercial specification-grade commodities for use 

12 as raw material feed stock at recovery facilities, 

13 including for use as— 

14 (i) a replacement or substitute for a 

15 virgin raw material; or 

16 (ii) a replacement or substitute for a 

17 product made, in whole or in part, from a 

18 virgin raw material; 

19 (B) has a verifiable carbon baseline; and 

20 (C) has an environmental, health and safe21 ty, and quality management system (such as 

22 that of the International Standards Organiza23 tion or an equivalent) that includes goals to re24 duce the operational carbon baseline of the re25 cycling facility per unit of material processed. 


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1 (3) MANUFACTURING FACILITY.—Funds pro2 vided under subsection (b)(4) shall be provided on a 

3 competitive basis to a manufacturing facility that— 

4 (A) can report on a verifiable carbon base5 line that is consistent with applicable reporting 

6 requirements; and 

7 (B) has an environmental, health and safe8 ty, and quality management system (such as 

9 that of the International Standards Organiza10 tion or an equivalent) that includes goals to re11 duce the operational carbon baseline of the 

12 manufacturing facility per unit of material 

13 processed. 

14 (d) REPORTING.—Each State that distributes funds 

15 under this section shall submit to the Administrator, in 

16 accordance with such requirements as the Administrator 

17 may prescribe, a report that includes— 

18 (1) a list of entities receiving funding under 

19 this section, including entities receiving such funding 

20 from units of local government pursuant to sub21 section (b)(2); 

22 (2) the amount of funding received by each 

23 such recipient; 

24 (3) the specific purposes for which the funding 

25 was conveyed to each such recipient; and 


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1 (4) documentation of the quantity of net recy2 clable material that was collected and processed and 

3 greenhouse gas emissions that were reduced or 

4 avoided accordingly, through use of the funding, 

5 based on a lifecycle calculation developed by the Ad6 ministrator. 

7 (e) METHODOLOGY AND DECISIONMAKING.—The Ad8 ministrator, as appropriate— 

9 (1) shall develop and periodically update 

10 lifecycle methods to quantify the relationship be11 tween waste management decisions, including recy12 cling and waste reduction, greenhouse gas reduc13 tions, and energy use reductions, for purposes that 

14 include— 

15 (A) helping to support decisions under 

16 Federal, State, and municipal recycling and 

17 waste management programs, including— 

18 (i) estimating greenhouse gas and en19 ergy benefits of increasing collection or 

20 adding new materials to recycling pro21 grams; 

22 (ii) comparing the benefits of recy23 cling and waste reduction to other green24 house gas and energy use reduction strate25 gies; 


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1 (iii) optimizing waste management 

2 strategies to maximize greenhouse gas re3 ductions and energy use reductions; and 

4 (iv) public education; and 

5 (B) designing products to optimize waste 

6 reduction and recycling opportunities and use of 

7 recycled materials in the manufacturing proc8 ess; 

9 (2) may collect data to support the development 

10 of the methods described in paragraph (1); and 

11 (3) to improve national consistency, shall, in 

12 consultation with appropriate State and local rep13 resentatives and municipal recycling programs, iden14 tify best practices to promote improvement in, and 

15 support State efforts in improving, municipal recy16 cling and resource recovery programs. 

17 SEC. 155. SUPPLEMENTAL AGRICULTURE AND FORESTRY 

18 GREENHOUSE GAS REDUCTION AND RENEW19 ABLE ENERGY PROGRAM. 

20 (a) AGRICULTURAL GREENHOUSE GAS REDUC21 TIONS.— 

22 (1) ESTABLISHMENT.— 

23 (A) IN GENERAL.—The Secretary of Agri24 culture (referred to in this section as the ‘‘Sec25 retary’’), in coordination with the Secretary of 


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1 the Interior, shall establish a Greenhouse Gas 

2 Reduction Incentives Program (referred to in 

3 this section as the ‘‘program’’) to provide finan4 cial assistance to owners and operators of agri5 cultural land (including land on which specialty 

6 crops are produced and private or public land 

7 used for grazing) and forest land for projects 

8 and activities that measurably increase carbon 

9 sequestration or reduce greenhouse gas emis10 sions. 

11 (B) SHARED AUTHORITY.—The Secretary 

12 shall delegate to the Secretary of the Interior 

13 the authority to carry out projects on land 

14 under the jurisdiction of or operated by the De15 partment of the Interior. 

16 (2) PRIORITY.—In carrying out the program, 

17 the Secretary shall give priority to projects or activi18 ties that— 

19 (A) reduce greenhouse gas emissions or in20 crease sequestration of greenhouse gases, and 

21 achieve significant other environmental benefits, 

22 such as the improvements of water or air qual23 ity or natural resources; and 

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1 erations where there are limited recognized op2 portunities to achieve such emission reductions 

3 or sequestration. 

4 (3) ELIGIBLE PROJECTS AND ACTIVITIES.—Eli5 gible projects and payments shall include those 

6 that— 

7 (A) reflect the comparable amount that the 

8 owners or operators would receive in the offset 

9 market if not for compliance with environ10 mental laws that preclude the owners and oper11 ators from being eligible for receiving an offset 

12 credit under a Federal law enacted for the pur13 pose of regulating greenhouse gas emissions; 

14 (B) provide greenhouse gas emission bene15 fits, but do not receive an offset credit or qual16 ify for an early action allowance under a Fed17 eral law enacted for the purpose of regulating 

18 greenhouse gas emissions, including projects 

19 and activities that provide an opportunity to 

20 demonstrate and test new or uncertain methods 

21 to reduce or sequester emissions; 

22 (C) reward early adopters, including pro23 ducers that practice no-till agriculture, and en24 sure that individuals and entities that took ac25 tion prior to the implementation of a Federal 


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1 law enacted for the purpose of regulating green2 house gas emissions are not placed at a com3 petitive disadvantage, including giving special 

4 consideration to owners or operators located in 

5 jurisdictions with more stringent environmental 

6 laws (including regulations), compliance with 

7 which precludes the owners or operators from 

8 participating such an offset market; 

9 (D) provide incentives for supplemental 

10 greenhouse gas emission reductions on private 

11 forest land of the United States; 

12 (E) prevent any conversion of land, includ13 ing native grassland, native prairie, rangeland, 

14 cropland, or forested land, that would increase 

15 greenhouse gas emissions or a loss of carbon se16 questration; or 

17 (F) support action on Federal, State, or 

18 tribal land. 

19 (4) REQUIREMENTS.—Financial incentives and 

20 support provided by the Secretary for a project or 

21 activity under this section shall, to the maximum ex22 tent practicable— 

23 (A) be directly proportional to the quantity 

24 and duration of greenhouse gas emissions re25 duced or carbon sequestered (except with reVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00160 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 spect to projects and activities that provide ad2 aptation benefits); and 

3 (B) complement and leverage existing con4 servation, forestry, and energy program expend5 itures to provide measurable emission reduction 

6 and sequestration benefits that otherwise may 

7 not take place or continue to exist. 

8 (5) ELIGIBILITY.—An owner or operator shall 

9 not be prohibited from participating in the program 

10 established under this section due to participation of 

11 the owner or operator in other Federal or State con12 servation or agricultural assistance programs. 

13 (6) FORMS OF ASSISTANCE.—The Secretary 

14 may use any of the following to provide assistance 

15 under this section: 

16 (A) Conservation easements. 

17 (B) Carbon sequestration and mitigation 

18 contracts between the owner or operator and 

19 the Secretary for the performance of projects or 

20 activities that reduce greenhouse gas emissions 

21 or sequester carbon. 

22 (C) Financial incentives through timber 

23 harvest contracts. 

24 (D) Financial incentives through grazing 

25 contracts. 


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1 (E) Grants. 

2 (F) Such other forms of assistance as the 

3 Secretary determines to be appropriate. 

4 (7) REVERSALS.—The Secretary shall specify 

5 methods to address intentional or unintentional re6 versal of carbon sequestration or greenhouse gas 

7 emission reductions that occur during the term of a 

8 contract or easement under this section. 

9 (8) ACCOUNTING SYSTEMS.—In carrying out 

10 this section, the Secretary shall develop and imple11 ment— 

12 (A) a national accounting system for car13 bon stocks, sequestration, and greenhouse gas 

14 emissions that may be used to assess progress 

15 in implementing this section at a national level; 

16 and 

17 (B) credible reporting and accounting sys18 tems to ensure that incentives provided under 

19 this section are achieving stated objectives. 

20 (9) PROGRAM MEASUREMENT, MONITORING, 

21 AND VERIFICATION.—The Secretary, in consultation 

22 with the Administrator— 

23 (A) shall establish and implement protocols 

24 that provide reasonable monitoring and 

25 verification of compliance with terms associated 


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1 with assistance provided under this section, in2 cluding field sampling of actual performance, to 

3 develop annual estimates of emission reductions 

4 achieved under the program; 

5 (B) shall report annually the total number 

6 of tons of carbon dioxide sequestered or the 

7 total number of tons of emissions avoided 

8 through incentives provided under this section; 

9 and 

10 (C) not later than 2 years after the date 

11 of enactment of this Act, and at least every 18 

12 months thereafter, submit to Congress and 

13 make available to the public on the website of 

14 the Department of Agriculture a report that in15 cludes— 

16 (i) an estimate of annual and cumu17 lative reductions generated through the 

18 program under this section, determined 

19 using standardized measures (including 

20 economic efficiency); and 

21 (ii) a summary of any changes to the 

22 program, in accordance with this section, 

23 that will be made as a result of program 

24 measurement, monitoring, and verification 

25 conducted under this section. 


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1 (b) RESEARCH PROGRAM.—The Secretary shall es2 tablish by rule a program to conduct research to develop 

3 additional projects and activities for crops to find addi4 tional techniques and methods to reduce greenhouse gas 

5 emissions or sequester greenhouse gases that may or may 

6 not meet criteria for a Federal law enacted for the purpose 

7 of regulating greenhouse gas emissions. 

8 SEC. 156. ECONOMIC DEVELOPMENT CLIMATE CHANGE 

9 FUND. 

10 (a) IN GENERAL.—Title II of the Public Works and 

11 Economic Development Act of 1965 (42 U.S.C. 3141 et 

12 seq.) is amended by adding at the end the following: 

13 ‘‘SEC. 219. ECONOMIC DEVELOPMENT CLIMATE CHANGE 

14 FUND. 

15 ‘‘(a) IN GENERAL.—On the application of an eligible 

16 recipient, the Secretary may provide technical assistance, 

17 make grants, enter into contracts, or otherwise provide 

18 amounts for projects— 

19 ‘‘(1) to promote energy efficiency to enhance 

20 economic competitiveness; 

21 ‘‘(2) to increase the use of renewable energy re22 sources to support sustainable economic development 

23 and job growth; 


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1 ‘‘(3) to support the development of conventional 

2 energy resources to produce alternative transpor3 tation fuels, electricity and heat; 

4 ‘‘(4) to develop energy efficient or environ5 mentally sustainable infrastructure; 

6 ‘‘(5) to promote environmentally sustainable 

7 economic development practices and models; 

8 ‘‘(6) to support development of energy effi9 ciency and alternative energy development plans, 

10 studies or analysis, including enhancement of new 

11 and existing Comprehensive Economic Development 

12 Strategies funded under this Act; and 

13 ‘‘(7) to supplement other Federal grants, loans, 

14 or loan guarantees for purposes described in para15 graphs (1) through (6). 

16 ‘‘(b) FEDERAL SHARE.—The Federal share of the 

17 cost of any project carried out under this section shall not 

18 exceed 80 percent, except that the Federal share of a Fed19 eral grant, loan, or loan guarantee provided under sub20 section (a)(7) may be 100 percent. 

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

22 is authorized to be appropriated to carry out this section 

23 $50,000,000 for each of fiscal years 2009 through 2013, 

24 to remain available until expended.’’. 


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1 (b) CONFORMING AMENDMENT.—The table of con2 tents contained in section 1(b) of the Public Works and 

3 Economic Development Act of 1965 (42 U.S.C. 3141 et 

4 seq.) is amended by inserting after the item relating to 

5 section 218 the following: 

‘‘Sec. 219. Economic Development Climate Change Fund.’’. 

6 SEC. 157. STUDY OF RISK-BASED PROGRAMS ADDRESSING 

7 VULNERABLE AREAS. 

8 (a) IN GENERAL.—The Administrator, or the heads 

9 of such other Federal agencies as the President may des10 ignate, shall conduct a study and, not later than 2 years 

11 after the date of enactment of this Act, submit to Con12 gress a report regarding risk-based policies and programs 

13 addressing vulnerable areas. 

14 (b) REQUIREMENTS.—The report shall 

15 (1) review and assess Federal predisaster miti16 gation, emergency response, and flood insurance 

17 policies and programs that affect areas vulnerable to 

18 the impacts of climate change; 

19 (2) describe strategies for better addressing 

20 such vulnerabilities and provide implementation rec21 ommendations; 

22 (3) assess whether the policies and programs 

23 described in paragraph (1) support the State re24 sponse and adaptation goals and objectives identified 

25 under this Act; 


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1 (4) identify, and make recommendations to re2 solve, inconsistencies in Federal policies and pro3 grams in effect as of the date of enactment of this 

4 Act that address areas vulnerable to climate change; 

5 and 

6 (5) identify annual cost savings to the Federal 

7 Government associated with the implementation of 

8 the strategies and recommendations contained in the 

9 report. 

10 Subtitle F—Energy Efficiency and 

11 Renewable Energy 

12 SEC. 161. RENEWABLE ENERGY. 

13 (a) DEFINITIONS.—In this section: 

14 (1) RENEWABLE ENERGY.—The term ‘‘renew15 able energy’’ means electric energy generated from 

16 solar, wind, biomass, landfill gas, ocean (including 

17 tidal, wave, current, and thermal), geothermal, mu18 nicipal solid waste, or new hydroelectric generation 

19 capacity achieved from increased efficiency or addi20 tions of new capacity at an existing hydroelectric 

21 project. 

22 (2) RENEWABLE PORTFOLIO STANDARD.—The 

23 term ‘‘ ‘renewable portfolio standard’ ’’ means a 

24 State statute that requires electricity providers to 


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1 obtain a minimum percentage of their power from 

2 renewable energy resources by a certain date. 

3 (b) GRANTS.—The Administrator, in consultation 

4 with the Secretaries of Energy, Interior, and Agriculture, 

5 may provide grants for projects to increase the quantity 

6 of energy a State uses from renewable sources under State 

7 renewable portfolio standard laws. 

8 (c) ELIGIBILITY.—The Administrator shall review for 

9 approval projects applications that are— 

10 (1) submitted by State and local governments, 

11 Indian tribes, public utilities, regional energy co12 operatives, or individual energy producers from 

13 states with a binding Renewable Portfolio Standard; 

14 or 

15 (2) submitted by State and local governments, 

16 Indian tribes, public utilities, or regional energy co17 operatives from States with nonbinding goals for 

18 adoption of renewable energy requirements. 

19 (d) PRIORITY.—The Administrator shall give priority 

20 to project applications that are— 

21 (1) submitted by States with a binding renew22 able portfolio standard; 

23 (2) cost-effective in achieving greater renewable 

24 energy production in each State. 

25 (e) CERTIFICATION.— 


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1 (1) IN GENERAL.—The Administrator shall no2 tify in writing the Governor of each eligible State as 

3 described in section (c) at the time at which the Ad4 ministrator begins review of a project application re5 ceived from an eligible entity within the State. 

6 (2) CERTIFICATION.—The Governor shall cer7 tify in writing within 30 days of receipt of the Ad8 ministrator’s notification described in subsection (1) 

9 that the project application— 

10 (A) will assist the State in reaching renew11 able portfolio standard targets under applicable 

12 state laws; and 

13 (B) has secured non-Federal funding 

14 sources that, in conjunction with the requested 

15 grant amount, will be sufficient to complete the 

16 renewable energy project. 

17 (f) RULEMAKING.— 

18 (1) IN GENERAL.—Not later than 90 days after 

19 the date of enactment of this Act, the Administrator 

20 shall initiate rulemaking procedures necessary to im21 plement this section. 

22 (2) FINAL RULES; ACCEPTANCE OF APPLICA23 TIONS.—Not later than 90 days after the close of 

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1 making described in paragraph (1), the Adminis2 trator shall— 

3 (A) promulgate final regulations to carry 

4 out this section; and 

5 (B) begin accepting project applications for 

6 review. 

7 (g) REPORTING.—Not later than 180 days after the 

8 date of enactment of this Act, and every 180 days there9 after, the Administrator shall submit to the Committee on 

10 Energy and Commerce of the House of Representatives 

11 and the Committee on Environment and Public Works of 

12 the Senate a report specifying, with respect to the pro13 gram under this section— 

14 (1) the project applications received; 

15 (2) the project applications approved; 

16 (3) the amount of funding allocated per project; 

17 and 

18 (4) the cumulative benefits of the grant pro19 gram. 

20 (h) GRANT AMOUNT.—A grant provided under this 

21 section may be in an amount that does not exceed 50 per22 cent of the total cost of the renewable energy project to 

23 be funded by the grant. 


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1 (i) AUTHORIZATION.—There are authorized to be ap2 propriated such sums as are necessary to carry out this 

3 section. 

4 SEC. 162. ADVANCED BIOFUELS. 

5 (a) DEFINITIONS.—In this section: 

6 (1) ADVANCED BIOFUEL.—The term ‘‘advanced 

7 biofuel’’ shall have such meaning as is given the 

8 term by the Administrator in regulations promul9 gated under subsection (c). 

10 (2) ELIGIBLE ENTITY.—The term ‘‘eligible enti11 ty’’ means an individual, corporate entity, unit of 

12 State or local government, Indian tribe, farm cooper13 ative, institution of higher learning, rural electric co14 operative, or public utility. 

15 (b) GRANTS.—The Administrator, in consultation 

16 with the Secretary of Agriculture and the Secretary of En17 ergy, may provide grants to support research and develop18 ment of advanced biofuels. 

19 (c) REGULATIONS.— 

20 (1) IN GENERAL.—Not later than 18 months 

21 after the date of enactment of this Act, the Adminis22 trator shall promulgate regulations to carry out this 

23 section (including a definition of the term ‘‘advanced 

24 biofuel’’ for the purpose of providing assistance 

25 under this section). 


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1 (2) REQUIREMENTS.—The regulations promul2 gated under paragraph (1) shall— 

3 (A) provide that the Administrator shall 

4 make grants available to eligible entities to sup5 port— 

6 (i) research regarding the production 

7 of advanced biofuels; 

8 (ii) the development of new advanced 

9 biofuel production and capacity-building 

10 technologies; 

11 (iii) the development and construction 

12 of commercial-scale advanced biofuel pro13 duction facilities; and 

14 (iv) the expanded production of ad15 vanced biofuels; 

16 (B) provide that, to receive a grant under 

17 this section, an eligible entity shall submit to 

18 the Administrator— 

19 (i) a project proposal with detailed 

20 project information, as determined by the 

21 Administrator; and 

22 (ii) such records as the Administrator 

23 may require as evidence of the production 

24 of advanced biofuels or the importance and 


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1 necessity of advanced biofuels research and 

2 new technologies; and 

3 (C) include appropriate cost-sharing re4 quirements developed by the Administrator for 

5 grant awards for authorized uses of funds 

6 under this section. 

7 (3) PRIORITY.—The Administrator shall give 

8 priority to eligible entities based on— 

9 (A) technical and economic feasibility of a 

10 project proposal; 

11 (B) cost-effectiveness of a project proposal; 

12 (C) the use of innovative technologies in a 

13 project proposal; 

14 (D) the availability of non-Federal re15 sources, including private resources, to fund the 

16 project proposal; and 

17 (E) whether the project proposed can be 

18 replicated. 

19 SEC. 163. ENERGY EFFICIENCY IN BUILDING CODES. 

20 (a) ENERGY EFFICIENCY TARGETS.— 

21 (1) RULEMAKING TO ESTABLISH TARGETS.— 

22 The Administrator, or such other agency head or 

23 heads as may be designated by the President, in 

24 consultation with the Director of the National Insti25 tute of Standards and Technology, shall promulgate 


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1 regulations establishing building code energy effi2 ciency targets for the national average percentage 

3 improvement of buildings’ energy performance. Such 

4 regulations shall establish a national building code 

5 energy efficiency target for residential buildings and 

6 commercial buildings when built to a code meeting 

7 the target, beginning not later than January 1, 2014 

8 and applicable each calendar year through December 

9 31, 2030. 

10 (b) NATIONAL ENERGY EFFICIENCY BUILDING

11 CODES.— 

12 (1) RULEMAKING TO ESTABLISH NATIONAL

13 CODES.—The Administrator, or such other agency 

14 head or heads as may be designated by the Presi15 dent, shall promulgate regulations establishing na16 tional energy efficiency building codes for residential 

17 and commercial buildings. Such regulations shall be 

18 sufficient to meet the national building code energy 

19 efficiency targets established under subsection (a) in 

20 the most cost-effective manner, and may include pro21 visions for State adoption of the national building 

22 code standards and certification of State programs 

23 (c) ANNUAL REPORTS.—The Administrator, or such 

24 other agency head or heads as may be designated by the 


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1 President, shall annually submit to Congress, and publish 

2 in the Federal Register, a report on— 

3 (1) the status of national energy efficiency 

4 building codes; 

5 (2) the status of energy efficiency building code 

6 adoption and compliance in the States; 

7 (3) the implementation of and compliance with 

8 regulations promulgated under this section; 

9 (4) the status of Federal and State enforcement 

10 of building codes; and 

11 (5) impacts of action under this section, and 

12 potential impacts of further action, on lifetime en13 ergy use by buildings, including resulting energy and 

14 cost savings. 

15 SEC. 164. RETROFIT FOR ENERGY AND ENVIRONMENTAL 

16 PERFORMANCE. 

17 (a) DEFINITIONS.—For purposes of this section: 

18 (1) ASSISTED HOUSING.—The term ‘‘assisted 

19 housing’’ means those properties receiving project20 based assistance pursuant to section 202 of the 

21 Housing Act of 1959 (12 U.S.C. 1701q), section 

22 811 of the Cranston-Gonzalez National Affordable 

23 Housing Act (42 U.S.C. 8013), section 8 of the 

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

25 1437f), or similar programs. 


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1 (2) NONRESIDENTIAL BUILDING.—The term 

2 ‘‘nonresidential building’’ means a building with a 

3 primary use or purpose other than residential hous4 ing, including any building used for commercial of5 fices, schools, academic and other public and private 

6 institutions, nonprofit organizations including faith7 based organizations, hospitals, hotels, and other non8 residential purposes. Such buildings shall include 

9 mixed-use properties used for both residential and 

10 nonresidential purposes in which more than half of 

11 building floor space is nonresidential. 

12 (3) PERFORMANCE-BASED BUILDING RETROFIT

13 PROGRAM.—The term ‘‘performance-based building 

14 retrofit program’’ means a program that determines 

15 building energy efficiency success based on actual 

16 measured savings after a retrofit is complete, as evi17 denced by energy invoices or evaluation protocols. 

18 (4) PRESCRIPTIVE BUILDING RETROFIT PRO19 GRAM.—The term ‘‘prescriptive building retrofit pro20 gram’’ means a program that projects building ret21 rofit energy efficiency success based on the known 

22 effectiveness of measures prescribed to be included 

23 in a retrofit. 

24 (5) PUBLIC HOUSING.—The term ‘‘public hous25 ing’’ means properties receiving assistance under 


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1 section 9 of the United States Housing Act of 1937 

2 (42 U.S.C. 1437g). 

3 (6) RECOMMISSIONING; 

4 RETROCOMMISSIONING.—The terms ‘‘recommission5 ing’’ and ‘‘retrocommissioning’’ have the meaning 

6 given those terms in section 543(f)(1) of the Na7 tional Energy Conservation Policy Act (42 U.S.C. 

8 8253(f)(1)). 

9 (7) RESIDENTIAL BUILDING.—The term ‘‘resi10 dential building’’ means a building whose primary 

11 use is residential. Such buildings shall include sin12 gle-family homes (both attached and detached), 

13 owner-occupied units in larger buildings with their 

14 own dedicated space-conditioning systems, apart15 ment buildings, multi-unit condominium buildings, 

16 public housing, assisted housing, and buildings used 

17 for both residential and nonresidential purposes in 

18 which more than half of building floor space is resi19 dential. 

20 (8) STATE ENERGY PROGRAM.—The term 

21 ‘‘State Energy Program’’ means the program under 

22 part D of title III of the Energy Policy and Con23 servation Act (42 U.S.C. 6321 et seq.). 

24 (b) ESTABLISHMENT.—The Administrator shall de25 velop and implement, in consultation with the Secretary 


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1 of Energy, standards for a national energy and environ2 mental building retrofit policy for single-family and multi3 family residences. The Administrator shall develop and 

4 implement, in consultation with the Secretary of Energy 

5 and the Director of Commercial High-Performance Green 

6 Buildings, standards for a national energy and environ7 mental building retrofit policy for nonresidential buildings. 

8 The programs to implement the residential and nonresi9 dential policies based on the standards developed under 

10 this section shall together be known as the Retrofit for 

11 Energy and Environmental Performance (REEP) pro12 gram. 

13 (c) PURPOSE.—The purpose of the REEP program 

14 is to facilitate the retrofitting of existing buildings across 

15 the United States to achieve maximum cost-effective en16 ergy efficiency improvements and significant improve17 ments in water use and other environmental attributes. 

18 (d) FEDERAL ADMINISTRATION.— 

19 (1) EXISTING PROGRAMS.—In creating and op20 erating the REEP program— 

21 (A) the Administrator shall make appro22 priate use of existing programs, including the 

23 Energy Star program and in particular the En24 vironmental Protection Agency Energy Star for 

25 Buildings program; and 


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1 (B) the Administrator shall consult with 

2 the Secretary of Energy regarding appropriate 

3 use of existing programs, including delegating 

4 authority to the Director of Commercial High5 Performance Green Buildings appointed under 

6 section 421 of the Energy Independence and 

7 Security Act of 2007 (42 U.S.C. 17081). 

8 (2) CONSULTATION AND COORDINATION.—The 

9 Administrator shall consult with and coordinate with 

10 the and the Secretary of Energy and the Secretary 

11 of Housing and Urban Development in carrying out 

12 the REEP program with regard to retrofitting of 

13 public housing and assisted housing. As a result of 

14 such consultation, the Administrator shall establish 

15 standards to ensure that retrofits of public housing 

16 and assisted housing funded pursuant to this section 

17 are cost-effective, including opportunities to address 

18 the potential co-performance of repair and replace19 ment needs that may be supported with other forms 

20 of Federal assistance. Owners of public housing or 

21 assisted housing receiving funding through the 

22 REEP program shall agree to continue to provide 

23 affordable housing consistent with the provisions of 

24 the authorizing legislation governing each program 

25 for an additional period commensurate with the 


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1 funding received, as determined in accordance with 

2 guidelines established by the Secretary of Housing 

3 and Urban Development. 

4 (3) ASSISTANCE.—The Administrator shall pro5 vide consultation and assistance to State and local 

6 agencies for the establishment of revolving loan 

7 funds, loan guarantees, or other forms of financial 

8 assistance under this section. 

9 (e) STATE AND LOCAL ADMINISTRATION.— 

10 (1) DESIGNATION AND DELEGATION.—A State 

11 may designate one or more agencies or entities, in12 cluding those regulated by the State, to carry out 

13 the purposes of this section, but shall designate one 

14 entity or individual as the principal point of contact 

15 for the Administrator regarding the REEP Pro16 gram. The designated State agency, agencies, or en17 tities may delegate performance of appropriate ele18 ments of the REEP program, upon their request 

19 and subject to State law, to counties, municipalities, 

20 appropriate public agencies, and other divisions of 

21 local government, as well as to entities regulated by 

22 the State. In making any such designation or delega23 tion, a State shall give priority to entities that ad24 minister existing comprehensive retrofit programs, 

25 including those under the supervision of State utility 


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1 regulators. States shall maintain responsibility for 

2 meeting the standards and requirements of the 

3 REEP program. In any State that elects not to ad4 minister the REEP program, a unit of local govern5 ment may propose to do so within its jurisdiction, 

6 and if the Administrator finds that such local gov7 ernment is capable of administering the program, 

8 the Administrator may provide assistance to that 

9 local government, prorated according to the popu10 lation of the local jurisdiction relative to the popu11 lation of the State, for purposes of the REEP pro12 gram. 

13 (2) EMPLOYMENT.—States and local govern14 ment entities may administer a REEP program in 

15 a manner that authorizes public or regulated inves16 tor-owned utilities, building auditors and inspectors, 

17 contractors, nonprofit organizations, for-profit com18 panies, and other entities to perform audits and ret19 rofit services under this section. A State may pro20 vide incentives for retrofits without direct participa21 tion by the State or its agents, so long as the result22 ing savings are measured and verified. A State or 

23 local administrator of a REEP program shall seek 

24 to ensure that sufficient qualified entities are avail25 able to support retrofit activities so that building 


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1 owners have a competitive choice among qualified 

2 auditors, raters, contractors, and providers of serv3 ices related to retrofits. Nothing in this section is in4 tended to deny the right of a building owner to 

5 choose the specific providers of retrofit services to 

6 engage for a retrofit project in that owner’s building. 

7 (3) EQUAL INCENTIVES FOR EQUAL IMPROVE8 MENT.—In general, the States should strive to offer 

9 the same levels of incentives for retrofits that meet 

10 the same efficiency improvement goals, regardless of 

11 whether the State, its agency or entity, or the build12 ing owner has conducted the retrofit achieving the 

13 improvement, provided the improvement is measured 

14 and verified. 

15 (f) ELEMENTS OF REEP PROGRAM.—The Adminis16 trator, in consultation with the Secretary of Energy, shall 

17 establish goals, guidelines, practices, and standards for ac18 complishing the purpose stated in subsection (c), and shall 

19 annually review and, as appropriate, revise such goals, 

20 guidelines, practices, and standards. The program under 

21 this section shall include the following: 

22 (1) Residential Energy Services Network 

23 (RESNET) or Building Performance Institute 

24 (BPI) analyst certification of residential building en25 ergy and environment auditors, inspectors, and ratVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00182 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 ers, or an equivalent certification system as deter2 mined by the Administrator. 

3 (2) BPI certification or licensing by States of 

4 residential building energy and environmental ret5 rofit contractors, or an equivalent certification or li6 censing system as determined by the Administrator. 

7 (3) Provision of BPI, RESNET, or other ap8 propriate information on equipment and procedures, 

9 as determined by the Administrator, that contractors 

10 can use to test the energy and environmental effi11 ciency of buildings effectively (such as infrared pho12 tography and pressurized testing, and tests for water 

13 use and indoor air quality). 

14 (4) Provision of clear and effective materials to 

15 describe the testing and retrofit processes for typical 

16 buildings. 

17 (5) Guidelines for offering and managing pre18 scriptive building retrofit programs and perform19 ance-based building retrofit programs for residential 

20 and nonresidential buildings. 

21 (6) Guidelines for applying recommissioning 

22 and retrocommissioning principles to improve a 

23 building’s operations and maintenance procedures. 

24 (7) A requirement that building retrofits con25 ducted pursuant to a REEP program utilize, espeVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00183 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 cially in all air-conditioned buildings, roofing mate2 rials with high solar energy reflectance, unless inap3 propriate due to green roof management, solar en4 ergy production, or for other reasons identified by 

5 the Administrator, in order to reduce energy con6 sumption within the building, increase the albedo of 

7 the building’s roof, and decrease the heat island ef8 fect in the area of the building, without reduction of 

9 otherwise applicable ceiling insulation standards. 

10 (8) Determination of energy savings in a per11 formance-based building retrofit program through— 

12 (A) for residential buildings, comparison of 

13 before and after retrofit scores on the Home 

14 Energy Rating System (HERS) Index, where 

15 the final score is produced by an objective third 

16 party; 

17 (B) for nonresidential buildings, Environ18 mental Protection Agency Portfolio Manager 

19 benchmarks; or 

20 (C) for either residential or nonresidential 

21 buildings, use of an Administrator-approved 

22 simulation program by a contractor with the 

23 appropriate certification, subject to appropriate 

24 software standards and verification of at least 


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1 15 percent of all work done, or such other per2 centage as the Administrator may determine. 

3 (9) Guidelines for utilizing the Energy Star 

4 Portfolio Manager, the Home Energy Rating System 

5 (HERS) rating system, Home Performance with En6 ergy Star program approvals, and any other tools 

7 associated with the retrofit program. 

8 (10) Requirements and guidelines for post-ret9 rofit inspection and confirmation of work and energy 

10 savings. 

11 (11) Detailed descriptions of funding options 

12 for the benefit of State and local governments, along 

13 with model forms, accounting aids, agreements, and 

14 guides to best practices. 

15 (12) Guidance on opportunities for— 

16 (A) rating or certifying retrofitted build17 ings as Energy Star buildings, or as green 

18 buildings under a recognized green building rat19 ing system; 

20 (B) assigning Home Energy Rating Sys21 tem (HERS) or similar ratings; and 

22 (C) completing any applicable building per23 formance labels. 


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1 (13) Sample materials for publicizing the pro2 gram to building owners, including public service an3 nouncements and advertisements. 

4 (14) Processes for tracking the numbers and lo5 cations of buildings retrofitted under the REEP pro6 gram, with information on projected and actual sav7 ings of energy and its value over time. 

8 (g) REQUIREMENTS.—As a condition of receiving as9 sistance for the REEP program pursuant to this Act, a 

10 State or qualifying local government shall— 

11 (1) adopt the standards for training, certifi12 cation of contractors, certification of buildings, and 

13 post-retrofit inspection as developed by the Adminis14 trator for residential and nonresidential buildings, 

15 respectively, except as necessary to match local con16 ditions, needs, efficiency opportunities, or other local 

17 factors, or to accord with State laws or regulations, 

18 and then only after the Administrator approves such 

19 a variance; 

20 (2) establish fiscal controls and accounting pro21 cedures (which conform to generally accepted gov22 ernment accounting principles) sufficient to ensure 

23 proper accounting during appropriate accounting pe24 riods for payments received and disbursements, and 

25 for fund balances; 


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1 (3) agree to make 10 percent of assistance re2 ceived to carry out this section available on a pref3 erential basis for retrofit projects proposed for pub4 lic housing and assisted housing, provided that— 

5 (A) none of such funds shall be used for 

6 demolition of such housing; 

7 (B) such retrofits not shall not be used to 

8 justify any increase in rents charged to resi9 dents of such housing; and 

10 (C) owners of such housing shall agree to 

11 continue to provide affordable housing con12 sistent with the provisions of the authorizing 

13 legislation governing each program for an addi14 tional period commensurate with the funding 

15 received; and 

16 (4) the Administrator shall conduct or require 

17 each State to have such independent financial audits 

18 of REEP-related funding as the Administrator con19 siders necessary or appropriate to carry out the pur20 poses of this section. 

21 (h) OPTIONS TO SUPPORT REEP PROGRAM.—The 

22 assistance provided under this section shall support the 

23 implementation through State REEP programs of alter24 nate means of creating incentives for, or reducing financial 


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1 barriers to, improved energy and environmental perform2 ance in buildings, consistent with this section, including— 

3 (1) implementing prescriptive building retrofit 

4 programs and performance-based building retrofit 

5 programs; 

6 (2) providing credit enhancement, interest rate 

7 subsidies, loan guarantees, or other credit support; 

8 (3) providing initial capital for public revolving 

9 fund financing of retrofits; 

10 (4) providing funds to support utility-operated 

11 retrofit programs with repayments over time 

12 through utility rates, calibrated to create net positive 

13 cash flow to the building owner, and transferable 

14 from one building owner to the next with the build15 ing’s utility services; 

16 (5) providing funds to local government pro17 grams to provide REEP services and financial as18 sistance; and 

19 (6) other means proposed by State and local 

20 agencies, subject to the approval of the Adminis21 trator. 

22 (i) SUPPORT FOR PROGRAM.— 

23 (1) INITIAL AWARD LIMITS.—Except as pro24 vided in paragraph (2), State and local REEP pro25 grams may make per-building direct expenditures 


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1 for retrofit improvements, or their equivalent in indi2 rect or other forms of financial support, from funds 

3 made available to carry out this section, in amounts 

4 not to exceed the following amounts per unit: 

5 (A) RESIDENTIAL BUILDING PROGRAM.— 

6 (i) AWARDS.—For residential build7 ings— 

8 (I) support for a free or low-cost 

9 detailed building energy audit that 

10 prescribes measures sufficient to 

11 achieve at least a 20 percent reduc12 tion in energy use, by providing an in13 centive equal to the documented cost 

14 of such audit, but not more than 

15 $200, in addition to any earned by 

16 achieving a 20 percent or greater effi17 ciency improvement; 

18 (II) a total of $1,000 for a com19 bination of measures, prescribed in an 

20 audit conducted under subclause (I), 

21 designed to reduce energy consump22 tion by more than 10 percent, and 

23 $2,000 for a combination of measures 

24 prescribed in such an audit, designed 


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1 to reduce energy consumption by more 

2 than 20 percent; 

3 (III) $3,000 for demonstrated 

4 savings of 20 percent, pursuant to a 

5 performance-based building retrofit 

6 program; and 

7 (IV) $1,000 for each additional 5 

8 percentage points of energy savings 

9 achieved beyond savings for which 

10 funding is provided under subclause 

11 (II) or (III). 

12 Funding shall not be provided under 

13 clauses (II) and (III) for the same energy 

14 savings. 

15 (ii) MAXIMUM PERCENTAGE.—Awards 

16 under clause (i) shall not exceed 50 per17 cent of retrofit costs for each building. For 

18 buildings with multiple residential units, 

19 awards under clause (i) shall not be great20 er than 50 percent of the total cost of ret21 rofitting the building, prorated among indi22 vidual residential units on the basis of rel23 ative costs of the retrofit. In the case of 

24 public housing and assisted housing, the 

25 50 percent contribution matching the conVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00190 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 tribution from REEP program funds may 

2 come from any other source, including 

3 other Federal funds. 

4 (iii) ADDITIONAL AWARDS.—Addi5 tional awards may be provided for pur6 poses of increasing energy efficiency, for 

7 buildings achieving at least 20 percent en8 ergy savings using funding provided under 

9 clause (i), in the form of grants of not 

10 more than $600 for measures projected or 

11 measured (using an appropriate method 

12 approved by the Administrator) to achieve 

13 at least 35 percent potable water savings 

14 through equipment or systems with an es15 timated service life of not less than 7 

16 years, and not more than an additional 

17 $20 may be provided for each additional 

18 one percent of such savings, up to a max19 imum total grant of $1,200. 

20 (B) NONRESIDENTIAL BUILDING PRO21 GRAM.— 

22 (i) AWARDS.—For nonresidential 

23 buildings— 

24 (I) support for a free or low-cost 

25 detailed building energy audit that 


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1 prescribes, as part of a energy-reduc2 ing measures sufficient to achieve at 

3 least a 20 percent reduction in energy 

4 use, by providing an incentive equal to 

5 the documented cost of such audit, 

6 but not more than $500, in addition 

7 to any award earned by achieving a 

8 20 percent or greater efficiency im9 provement; 

10 (II) $0.15 per square foot of ret11 rofit area for demonstrated energy use 

12 reductions from 20 percent to 30 per13 cent; 

14 (III) $0.75 per square foot for 

15 demonstrated energy use reductions 

16 from 30 percent to 40 percent; 

17 (IV) $1.60 per square foot for 

18 demonstrated energy use reductions 

19 from 40 percent to 50 percent; and 

20 (V) $2.50 per square foot for 

21 demonstrated energy use reductions 

22 exceeding 50 percent. 

23 (ii) MAXIMUM PERCENTAGE.— 

24 Amounts provided under subclauses (II) 

25 through (V) of clause (i) combined shall 


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1 not exceed 50 percent of the total retrofit 

2 cost of a building. In nonresidential build3 ings with multiple units, such awards shall 

4 be prorated among individual units on the 

5 basis of relative costs of the retrofit. 

6 (iii) ADDITIONAL AWARDS.—Addi7 tional awards may be provided, for build8 ings achieving at least 20 percent energy 

9 savings using funding provided under 

10 clause (i), as follows: 

11 (I) WATER.—For purposes of in12 creasing energy efficiency, grants may 

13 be made for whole building potable 

14 water use reduction (using an appro15 priate method approved by the Ad16 ministrator) for up to 50 percent of 

17 the total retrofit cost, including 

18 amounts up to— 

19 (aa) $24.00 per thousand 

20 gallons per year of potable water 

21 savings of 40 percent or more; 

22 (bb) $27.00 per thousand 

23 gallons per year of potable water 

24 savings of 50 percent or more; 

25 and 


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1 (cc) $30.00 per thousand 

2 gallons per year of potable water 

3 savings of 60 percent or more. 

4 (II) ENVIRONMENTAL IMPROVE5 MENTS.—Additional awards of up to 

6 $1,000 may be granted for the inclu7 sion of other environmental attributes 

8 that the Administrator, in consulta9 tion with the Secretary, identifies as 

10 contributing to energy efficiency. Such 

11 attributes may include, but are not 

12 limited to waste diversion and the use 

13 of environmentally preferable mate14 rials (including salvaged, renewable, 

15 or recycled materials, and materials 

16 with no or low-VOC content). The Ad17 ministrator may recommend that 

18 States develop such standards as are 

19 necessary to account for local or re20 gional conditions that may affect the 

21 feasibility or availability of identified 

22 resources and attributes. 

23 (iv) INDOOR AIR QUALITY MINIMUM.— 

24 Nonresidential buildings receiving incen25 tives under this section must satisfy at a 


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1 minimum the most recent version of 

2 ASHRAE Standard 62.1 for ventilation, or 

3 the equivalent as determined by the Ad4 ministrator. A State may issue a waiver 

5 from this requirement to a building project 

6 on a showing that such compliance is in7 feasible due to the physical constraints of 

8 the building’s existing ventilation system, 

9 or such other limitations as may be speci10 fied by the Administrator. 

11 (C) DISASTER DAMAGED BUILDINGS.—Any 

12 source of funds, including Federal funds pro13 vided through the Robert T. Stafford Disaster 

14 Relief and Emergency Assistance Act, shall 

15 qualify as the building owner’s 50 percent con16 tribution, in order to match the contribution of 

17 REEP funds, so long as the REEP funds are 

18 only used to improve the energy efficiency of 

19 the buildings being reconstructed. In addition, 

20 the appropriate Federal agencies providing as21 sistance to building owners through the Robert 

22 T. Stafford Disaster Relief and Emergency As23 sistance Act shall make information available, 

24 following a disaster, to building owners rebuild25 ing disaster damaged buildings with assistance 


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1 from the Act, that REEP funds may be used 

2 for energy efficiency improvements. 

3 (D) HISTORIC BUILDINGS.—Notwith4 standing subparagraphs (A) and (B), a building 

5 in or eligible for the National Register of His6 toric Places shall be eligible for awards under 

7 this paragraph in amounts up to 120 percent of 

8 the amounts set forth in subparagraphs (A) and 

9 (B). 

10 (E) SUPPLEMENTAL SUPPORT.—State and 

11 local governments may supplement the per12 building expenditures under this paragraph 

13 with funding from other sources. 

14 (2) ADJUSTMENT.—The Administrator may ad15 just the specific dollar amounts provided under para16 graph (1) in years subsequent to the second year 

17 after the date of enactment of this Act, and every 

18 2 years thereafter, as the Administrator determines 

19 necessary to achieve optimum cost-effectiveness and 

20 to maximize incentives to achieve energy efficiency 

21 within the total building award amounts provided in 

22 that paragraph, and shall publish and hold constant 

23 such revised limits for at least 2 years. 

24 (j) REPORT TO CONGRESS.—The Administrator shall 

25 conduct an annual assessment of the achievements of the 


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1 REEP program in each State, shall prepare an annual re2 port of such achievements and any recommendations for 

3 program modifications, and shall provide such report to 

4 Congress at the end of each fiscal year during which fund5 ing or other resources were made available to the States 

6 for the REEP Program. 

7 Subtitle G—Emission Reductions 

8 From Public Transportation Ve9 hicles 

10 SEC. 171. SHORT TITLE. 

11 This subtitle may be cited as the ‘‘Green Taxis Act 

12 of 2009’’. 

13 SEC. 172. STATE FUEL ECONOMY REGULATION FOR TAXI14 CABS. 

15 Section 32919 of title 49, United States Code, is 

16 amended by adding at the end the following new sub17 section: 

18 ‘‘(d) TAXICABS.—Notwithstanding subsection (a), a 

19 State or political subdivision of a State may prescribe re20 quirements for fuel economy for taxicabs and other auto21 mobiles if such requirements are at least as stringent as 

22 applicable Federal requirements and if such taxicabs and 

23 other automobiles— 


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1 ‘‘(1) are automobiles that are capable of trans2 porting not more than 10 individuals, including the 

3 driver; 

4 ‘‘(2) are commercially available or are designed 

5 and manufactured pursuant to a contract with such 

6 State or political subdivision of such State; 

7 ‘‘(3) are operated for hire pursuant to an oper8 ating or regulatory license, permit, or other author9 ization issued by such State or political subdivision 

10 of such State; 

11 ‘‘(4) provide local transportation for a fare de12 termined on the basis of the time or distance trav13 eled or a combination of time and distance traveled; 

14 and 

15 ‘‘(5) do not exclusively provide transportation to 

16 and from airports.’’. 

17 SEC. 173. STATE REGULATION OF MOTOR VEHICLE EMIS18 SIONS FOR TAXICABS. 

19 Section 209 of the Clean Air Act (42 U.S.C. 7543) 

20 is amended by adding at the end the following new sub21 section: 

22 ‘‘(f) TAXICABS.—(1) Notwithstanding subsection (a), 

23 a State or political subdivision thereof may adopt and en24 force standards for the control of emissions from new 

25 motor vehicles that are taxicabs and other vehicles if such 


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1 standards will be, in the aggregate, at least as protective 

2 of public health and welfare as applicable Federal stand3 ards and if such taxicabs and other vehicles— 

4 ‘‘(A) are passenger motor vehicles that are 

5 capable of transporting not more than 10 indi6 viduals, including the driver; 

7 ‘‘(B) are commercially available or are de8 signed and manufactured pursuant to a con9 tract with such State or political subdivision 

10 thereof; 

11 ‘‘(C) are operated for hire pursuant to an 

12 operating or regulatory license, permit, or other 

13 authorization issued by such State or political 

14 subdivision thereof; 

15 ‘‘(D) provide local transportation for a fare 

16 determined on the basis of the time or distance 

17 traveled or a combination of time and distance 

18 traveled; and 

19 ‘‘(E) do not exclusively provide transpor20 tation to and from airports. 

21 ‘‘(2) If each standard of a State or political subdivi22 sion thereof is at least as stringent as the comparable ap23 plicable Federal standard, such standard of such State or 

24 political subdivision thereof shall be deemed at least as 


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1 protective of health and welfare as such Federal standards 

2 for purposes of this subsection.’’. 

3 Subtitle H—Clean Energy and 

4 Natural Gas 

5 SEC. 181. CLEAN ENERGY AND ACCELERATED EMISSION 

6 REDUCTION PROGRAM. 

7 (a) ESTABLISHMENT.— 

8 (1) IN GENERAL.—The Administrator shall es9 tablish a program to promote dispatchable power 

10 generation projects that can accelerate the reduction 

11 of power sector carbon dioxide and other greenhouse 

12 gas emissions. 

13 (2) USE OF FUNDS.—Funds provided under 

14 this section shall be used by the Administrator to 

15 make incentive payments to owners or operators of 

16 eligible projects. 

17 (b) REGULATIONS.—Not later than 90 days after the 

18 date of enactment of this Act, the Administrator shall pro19 mulgate regulations providing for incentives, pursuant to 

20 the requirements of this section. 

21 (c) GOAL.—Not later than 3 years after the date of 

22 enactment of this Act, the Administrator shall provide in23 centives for eligible projects that generate 300,000 

24 gigawatt-hours of electricity per year. 


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1 (d) CRITERIA FOR ELIGIBLE PROJECTS.—To be eli2 gible for funding under this section a project must— 

3 (1) reduce emissions below the 2007 average 

4 greenhouse gas emissions per megawatt-hour of the 

5 United States electric power sector by the quantity 

6 specified in subsection (f); and 

7 (2) not receive an investment or production 

8 credit in— 

9 (A) the year in which the project is placed 

10 in service; or 

11 (B) calendar year 2009, notwithstanding 

12 the year in which the project was placed in 

13 service. 

14 (e) PRIORITY.—The Administrator shall give priority 

15 to eligible projects from the following categories: 

16 (1) Power generation projects designed to inte17 grate intermittent renewable power into the bulk18 power system. 

19 (2) Energy storage projects used to support re20 newable energy. 

21 (3) Power generation projects with carbon cap22 ture and sequestration that are not eligible for other 

23 assistance under this Act. 


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1 (4) Projects that achieve the greatest reduction 

2 in greenhouse gas emissions per dollar of incentive 

3 payment. 

4 (f) EMISSION REDUCTION CRITERIA.—For the pur5 poses of subsection (d), the applicable emission reduction 

6 quantity shall be determined in accordance with the fol7 lowing table: 

Calendar years 

Percentage below 2007 average greenhouse gas emissions per MWh of 

United States electric power sector 

2010 through 2020 .................................................. 25 percent 

2021 through 2025 .................................................. 40 percent 

2026 through 2030 .................................................. 65 percent 

8 (g) AUTHORIZATION OF APPROPRIATIONS.—There 

9 are authorized to be appropriated to the Administrator 

10 such sums as are necessary to carry out this section for 

11 each of fiscal years 2010 through 2030. 

12 SEC. 182. ADVANCED NATURAL GAS TECHNOLOGIES. 

13 (a) DEFINITIONS.—In this section: 

14 (1) CORPORATION.— 

15 (A) IN GENERAL.—The term ‘‘corpora16 tion’’ means any corporation, joint-stock com17 pany, partnership, limited liability company, as18 sociation, business trust, or other organized 

19 group of persons, regardless of incorporation. 

20 (B) EXCLUSION.—The term ‘‘corporation’’ 

21 does not include a municipality. 

22 (2) ELIGIBLE ENTITY.— 


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1 (A) IN GENERAL.—The term ‘‘eligible enti2 ty’’ means an entity that is eligible to receive a 

3 grant under subsection (b). 

4 (B) INCLUSIONS.—The term ‘‘eligible enti5 ty’’ includes a corporation, an eligible research 

6 entity, an industry entity, a municipality, a mu7 nicipal natural gas distribution system, and a 

8 natural gas distribution company. 

9 (3) ELIGIBLE RESEARCH ENTITY.— 

10 (A) IN GENERAL.—The term ‘‘eligible re11 search entity’’ means an entity that is experi12 enced in planning, conducting, and imple13 menting natural gas research, development, 

14 demonstration, and deployment projects. 

15 (B) INCLUSIONS.—The term ‘‘eligible re16 search entity’’ includes a research institution 

17 and an institution of higher education. 

18 (4) INDUSTRY ENTITY.— 

19 (A) IN GENERAL.—The term ‘‘industry en20 tity’’ means the persons and municipalities col21 lectively engaged in the delivery of natural gas 

22 for consumption in the United States (such as 

23 natural gas distribution companies and munic24 ipal natural gas distribution systems). 


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1 (B) EXCLUSION.—The term ‘‘industry en2 tity’’ does not include any natural gas cus3 tomer. 

4 (5) MUNICIPALITY.—The term ‘‘municipality’’ 

5 means a city, county, or other political subdivision or 

6 agency of a State. 

7 (6) MUNICIPAL NATURAL GAS DISTRIBUTION

8 SYSTEM.—The term ‘‘municipal natural gas distribu9 tion system’’ means a municipality engaged in the 

10 business of delivering natural gas for consumption to 

11 residential, commercial, industrial, and other natural 

12 gas customers. 

13 (7) NATURAL GAS.— 

14 (A) IN GENERAL.—The term ‘‘natural 

15 gas’’ means a mixture of hydrocarbon and non16 hydrocarbon gases, primarily methane, that 

17 have been produced from geological formations 

18 or by any other means. 

19 (B) INCLUSION.—The term ‘‘natural gas’’ 

20 includes renewable biogas. 

21 (8) NATURAL GAS DISTRIBUTION COMPANY.— 

22 The term ‘‘natural gas distribution company’’ means 

23 a person engaged in the business of distributing nat24 ural gas for consumption to residential, commercial, 

25 industrial, or other natural gas customers. 


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1 (b) GRANT PROGRAMS.— 

2 (1) NATURAL GAS ELECTRICITY GENERATION

3 GRANTS.—The Administrator, in consultation with 

4 Secretary of Energy, may provide to eligible entities 

5 research and development grants to support the de6 ployment of low greenhouse-gas-emitting end-use 

7 technologies, including carbon capture and seques8 tration technologies, for natural gas electricity gen9 eration. 

10 (2) NATURAL GAS RESIDENTIAL AND COMMER11 CIAL TECHNOLOGY GRANTS.—The Administrator 

12 shall establish a program to provide to eligible enti13 ties grants to advance the commercial demonstration 

14 or early development of low greenhouse-gas-emitting 

15 end-use technologies fueled by natural gas, including 

16 carbon capture and storage, for residential and com17 mercial purposes, through research, development, 

18 demonstration, and deployment of those tech19 nologies. 

20 (c) REPORTING.—Not later than 180 days after the 

21 date of enactment of this Act, and every 180 days there22 after, the Secretary of Energy shall submit to the Com23 mittee on Energy and Commerce of the House of Rep24 resentatives and the Senate Committees on Energy and 

25 Natural Resources and Environment and Public Works of 


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1 the Senate a report that describes the status and results 

2 of activities carried out under subsection (b). 

3 (d) AUTHORIZATION.—There are authorized to be ap4 propriated such sums as are necessary to carry out this 

5 section. 

6 TITLE II—RESEARCH 

7 Subtitle A—Energy Research 

8 SEC. 201. ADVANCED ENERGY RESEARCH. 

9 (a) IN GENERAL.—The Administrator shall establish 

10 a program to provide grants for advanced energy research. 

11 (b) DISTRIBUTION.—The Administrator shall dis12 tribute grants on a competitive basis to institutions of 

13 higher education, companies, research foundations, trade 

14 and industry research collaborations, or consortia of such 

15 entities, or other appropriate research and development 

16 entities. 

17 (c) SELECTION OF PROPOSALS.—In selecting pro18 posals for funding under this section, the Administrator 

19 shall prioritize applications that— 

20 (1) enhance the economic and energy security 

21 of the United States through the development of en22 ergy technologies that result in— 

23 (A) reductions of imports of energy from 

24 foreign sources; 


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1 (B) reductions of energy-related emissions, 

2 including greenhouse gases; and 

3 (C) improvements in the energy efficiency 

4 of all economic sectors; and 

5 (2) ensure that the United States maintains a 

6 technological lead in developing and deploying ad7 vanced energy technologies. 

8 (d) RESPONSIBILITIES.—The Administrator shall be 

9 responsible for assessing the success of programs and ter10 minating programs carried out under this section that are 

11 not achieving the goals of the programs. 

12 (e) ASSISTANCE.—Assistance provided under this 

13 section shall be used to supplement, and not to supplant, 

14 any other Federal resources available to carry out activi15 ties described in this section. 

16 (f) AUTHORIZATION.—There are authorized to be ap17 propriated such sums as are necessary to carry out this 

18 section. 

19 Subtitle B—Drinking Water Adap20 tation, Technology, Education, 

21 and Research 

22 SEC. 211. EFFECTS OF CLIMATE CHANGE ON DRINKING 

23 WATER UTILITIES. 

24 (a) FINDINGS.—Congress finds that— 


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1 (1) the consensus among climate scientists is 

2 overwhelming that climate change is occurring more 

3 rapidly than can be attributed to natural causes, and 

4 that significant impacts to the water supply are al5 ready occurring; 

6 (2) among the first and most critical of those 

7 impacts will be change to patterns of precipitation 

8 around the world, which will affect water availability 

9 for the most basic drinking water and domestic 

10 water needs of populations in many areas of the 

11 United States; 

12 (3) drinking water utilities throughout the 

13 United States, as well as those in Europe, Australia, 

14 and Asia, are concerned that extended changes in 

15 precipitation will lead to extended droughts; 

16 (4) supplying water is highly energy-intensive 

17 and will become more so as climate change forces 

18 more utilities to turn to alternative supplies; 

19 (5) energy production consumes a significant 

20 percentage of the fresh water resources of the 

21 United States; 

22 (6) since 2003, the drinking water industry of 

23 the United States has sponsored, through a non24 profit water research foundation, various studies to 


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1 assess the impacts of climate change on drinking 

2 water supplies; 

3 (7) those studies demonstrate the need for a 

4 comprehensive program of research into the full 

5 range of impacts on drinking water utilities, includ6 ing impacts on water supplies, facilities, and cus7 tomers; 

8 (8) that nonprofit water research foundation is 

9 also coordinating internationally with other drinking 

10 water utilities on shared research projects and has 

11 hosted international workshops with counterpart Eu12 ropean and Asian water research organizations to 

13 develop a unified research agenda for applied re14 search on adaptive strategies to address climate 

15 change impacts; 

16 (9) research data in existence as of the date of 

17 enactment of this Act— 

18 (A) summarize the best available scientific 

19 evidence on climate change; 

20 (B) identify the implications of climate 

21 change for the water cycle and the availability 

22 and quality of water resources; and 

23 (C) provide general guidance on planning 

24 and adaptation strategies for water utilities; 

25 and 


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1 (10) given uncertainties about specific climate 

2 changes in particular areas, drinking water utilities 

3 need to prepare for a wider range of likely possibili4 ties in managing and delivery of water. 

5 (b) IN GENERAL.—The Administrator, in cooperation 

6 with the Secretary of Commerce, the Secretary of Energy, 

7 and the Secretary of the Interior, shall establish and pro8 vide funding for a program of directed and applied re9 search, to be conducted through a nonprofit drinking 

10 water research foundation and sponsored by water utili11 ties, to assist the utilities in adapting to the effects of cli12 mate change. 

13 (c) RESEARCH AREAS.—The research conducted in 

14 accordance with subsection (b) shall include research 

15 into— 

16 (1) water quality impacts and solutions, includ17 ing research— 

18 (A) to address probable impacts on raw 

19 water quality resulting from— 

20 (i) erosion and turbidity from extreme 

21 precipitation events; 

22 (ii) watershed vegetation changes; and 

23 (iii) increasing ranges of pathogens, 

24 algae, and nuisance organisms resulting 

25 from warmer temperatures; and 


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1 (B) on mitigating increasing damage to 

2 watersheds and water quality by evaluating ex3 treme events, such as wildfires and hurricanes, 

4 to learn and develop management approaches to 

5 mitigate— 

6 (i) permanent watershed damage; 

7 (ii) quality and yield impacts on 

8 source waters; and 

9 (iii) increased costs of water treat10 ment; 

11 (2) impacts on groundwater supplies from car12 bon sequestration, including research to evaluate po13 tential water quality consequences of carbon seques14 tration in various regional aquifers, soil conditions, 

15 and mineral deposits; 

16 (3) water quantity impacts and solutions, in17 cluding research— 

18 (A) to evaluate climate change impacts on 

19 water resources throughout hydrological basins 

20 of the United States; 

21 (B) to improve the accuracy and resolution 

22 of climate change models at a regional level; 

23 (C) to identify and explore options for in24 creasing conjunctive use of aboveground and 

25 underground storage of water; and 


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1 (D) to optimize operation of existing and 

2 new reservoirs in diminished and erratic periods 

3 of precipitation and runoff; 

4 (4) infrastructure impacts and solutions for 

5 water treatment and wastewater treatment facilities 

6 and underground pipelines, including research— 

7 (A) to evaluate and mitigate the impacts of 

8 sea level rise on— 

9 (i) near-shore facilities; 

10 (ii) soil drying and subsidence; 

11 (iii) reduced flows in water and waste12 water pipelines; and 

13 (iv) extreme flows in wastewater sys14 tems; and 

15 (B) on ways of increasing the resilience of 

16 existing infrastructure, planning cost-effective 

17 responses to adapt to climate change, and de18 veloping new design standards for future infra19 structure that include the use of energy con20 servation measures and renewable energy in 

21 new construction to the maximum extent prac22 ticable; 

23 (5) desalination, water reuse, and alternative 

24 supply technologies, including research— 


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1 (A) to improve and optimize existing mem2 brane technologies, and to identify and develop 

3 breakthrough technologies, to enable the use of 

4 seawater, brackish groundwater, treated waste5 water, and other impaired sources; 

6 (B) into new sources of water through 

7 more cost-effective water treatment practices in 

8 recycling and desalination; and 

9 (C) to improve technologies for use in— 

10 (i) managing and minimizing the vol11 ume of desalination and reuse concentrate 

12 streams; and 

13 (ii) minimizing the environmental im14 pacts of seawater intake at desalination fa15 cilities; 

16 (6) energy efficiency and greenhouse gas mini17 mization, including research— 

18 (A) on optimizing the energy efficiency of 

19 water supply and wastewater operations and 

20 improving water efficiency in energy production 

21 and management; and 

22 (B) to identify and develop renewable, car23 bon-neutral energy options for the water supply 

24 and wastewater industry; 


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1 (7) regional and hydrological basin cooperative 

2 water management solutions, including research 

3 into— 

4 (A) institutional mechanisms for greater 

5 regional cooperation and use of water ex6 changes, banking, and transfers; and 

7 (B) the economic benefits of sharing risks 

8 of shortage across wider areas; 

9 (8) utility management, decision support sys10 tems, and water management models, including re11 search— 

12 (A) into improved decision support systems 

13 and modeling tools for use by water utility 

14 managers to assist with increased water supply 

15 uncertainty and adaptation strategies posed by 

16 climate change; 

17 (B) to provide financial tools, including 

18 new rate structures, to manage financial re19 sources and investments, because increased con20 servation practices may diminish revenue and 

21 increase investments in infrastructure; and 

22 (C) to develop improved systems and mod23 els for use in evaluating— 


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1 (i) successful alternative methods for 

2 conservation and demand management; 

3 and 

4 (ii) climate change impacts on 

5 groundwater resources; 

6 (9) reducing greenhouse gas emissions and im7 proving energy demand management, including re8 search to improve energy efficiency in water collec9 tion, production, transmission, treatment, distribu10 tion, and disposal to provide more sustainability and 

11 means to assist drinking water utilities in reducing 

12 the production of greenhouse gas emissions in the 

13 collection, production, transmission, treatment, dis14 tribution, and disposal of drinking water; 

15 (10) water conservation and demand manage16 ment, including research— 

17 (A) to develop strategic approaches to 

18 water demand management that offer the low19 est-cost, noninfrastructural options to serve 

20 growing populations or manage declining sup21 plies, primarily through— 

22 (i) efficiencies in water use and re23 allocation of the saved water; 

24 (ii) demand management tools; 

25 (iii) economic incentives; and 


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1 (iv) water-saving technologies; and 

2 (B) into efficiencies in water management 

3 through integrated water resource management 

4 that incorporates— 

5 (i) supply-side and demand-side proc6 esses; 

7 (ii) continuous adaptive management; 

8 and 

9 (iii) the inclusion of stakeholders in 

10 decisionmaking processes; and 

11 (11) communications, education, and public ac12 ceptance, including research— 

13 (A) into improved strategies and ap14 proaches for communicating with customers, de15 cisionmakers, and other stakeholders about the 

16 implications of climate change on water supply 

17 and water management; 

18 (B) to develop effective communication ap19 proaches— 

20 (i) to gain public acceptance of alter21 native water supplies and new policies and 

22 practices, including conservation and de23 mand management; and 

24 (ii) to gain public recognition and ac25 ceptance of increased costs; and 


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1 (C) to create and maintain a clearinghouse 

2 of climate change information for water utili3 ties, academic researchers, stakeholders, gov4 ernment agencies, and research organizations. 

5 (d) AUTHORIZATION OF APPROPRIATIONS.—There is 

6 authorized to be appropriated to carry out this section 

7 $25,000,000 for each of fiscal years 2010 through 2020. 

8 TITLE III—TRANSITION AND 

9 ADAPTATION 

10 Subtitle A—Green Jobs and Worker 

11 Transition 

12 PART 1—GREEN JOBS 

13 SEC. 301. CLEAN ENERGY CURRICULUM DEVELOPMENT 

14 GRANTS. 

15 (a) AUTHORIZATION.—The Secretary of Education is 

16 authorized to award grants, on a competitive basis, to eli17 gible partnerships to develop programs of study (con18 taining the information described in section 122(c)(1)(A) 

19 of the Carl D. Perkins Career and Technical Education 

20 Act of 2006 (20 U.S.C. 2342)), that are focused on emerg21 ing careers and jobs in the fields of clean energy, renew22 able energy, energy efficiency, climate change mitigation, 

23 and climate change adaptation. The Secretary of Edu24 cation shall consult with the Secretary of Labor and the 


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1 Secretary of Energy prior to the issuance of a solicitation 

2 for grant applications. 

3 (b) ELIGIBLE PARTNERSHIPS.—For purposes of this 

4 section, an eligible partnership shall include— 

5 (1) at least 1 local educational agency eligible 

6 for funding under section 131 of the Carl D. Per7 kins Career and Technical Education Act of 2006 

8 (20 U.S.C. 2351) or an area career and technical 

9 education school or education service agency de10 scribed in such section; 

11 (2) at least 1 postsecondary institution eligible 

12 for funding under section 132 of such Act (20 

13 U.S.C. 2352); and 

14 (3) representatives of the community including 

15 business, labor organizations, and industry that have 

16 experience in fields as described in subsection (a). 

17 (c) APPLICATION.—An eligible partnership seeking a 

18 grant under this section shall submit an application to the 

19 Secretary at such time and in such manner as the Sec20 retary may require. Applications shall include— 

21 (1) a description of the eligible partners and 

22 partnership, the roles and responsibilities of each 

23 partner, and a demonstration of each partner’s ca24 pacity to support the program; 


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1 (2) a description of the career area or areas 

2 within the fields as described in subsection (a) to be 

3 developed, the reason for the choice, and evidence of 

4 the labor market need to prepare students in that 

5 area; 

6 (3) a description of the new or existing program 

7 of study and both secondary and postsecondary com8 ponents; 

9 (4) a description of the students to be served by 

10 the new program of study; 

11 (5) a description of how the program of study 

12 funded by the grant will be replicable and dissemi13 nated to schools outside of the partnership, including 

14 urban and rural areas; 

15 (6) a description of applied learning that will be 

16 incorporated into the program of study and how it 

17 will incorporate or reinforce academic learning; 

18 (7) a description of how the program of study 

19 will be delivered; 

20 (8) a description of how the program will pro21 vide accessibility to students, especially economically 

22 disadvantaged, low performing, and urban and rural 

23 students; 

24 (9) a description of how the program will ad25 dress placement of students in nontraditional fields 


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1 as described in section 3(20) of the Carl D. Perkins 

2 Career and Technical Education Act of 2006 (20 

3 U.S.C. 2302(20)); and 

4 (10) a description of how the applicant proposes 

5 to consult or has consulted with a labor organiza6 tion, labor management partnership, apprenticeship 

7 program, or joint apprenticeship and training pro8 gram that provides education and training in the 

9 field of study for which the applicant proposes to de10 velop a curriculum. 

11 (d) PRIORITY.—The Secretary shall give priority to 

12 applications that— 

13 (1) use online learning or other innovative 

14 means to deliver the program of study to students, 

15 educators, and instructors outside of the partner16 ship; and 

17 (2) focus on low performing students and spe18 cial populations as defined in section 3(29) of the 

19 Carl D. Perkins Career and Technical Education 

20 Act of 2006 (20 U.S.C. 2302(29)). 

21 (e) PEER REVIEW.—The Secretary shall convene a 

22 peer review process to review applications for grants under 

23 this section and to make recommendations regarding the 

24 selection of grantees. Members of the peer review com25 mittee shall include— 


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1 (1) educators who have experience imple2 menting curricula with comparable purposes; and 

3 (2) business and industry experts in fields as 

4 described in subsection (a). 

5 (f) USES OF FUNDS.—Grants awarded under this 

6 section shall be used for the development, implementation, 

7 and dissemination of programs of study (as described in 

8 section 122(c)(1)(A) of the Carl D. Perkins Career and 

9 Technical Education Act (20 U.S.C. 2342(c)(1)(A))) in 

10 career areas related to clean energy, renewable energy, en11 ergy efficiency, climate change mitigation, and climate 

12 change adaptation. 

13 SEC. 302. DEVELOPMENT OF INFORMATION AND RE14 SOURCES CLEARINGHOUSE FOR VOCA15 TIONAL EDUCATION AND JOB TRAINING IN 

16 RENEWABLE ENERGY SECTORS. 

17 (a) DEVELOPMENT OF CLEARINGHOUSE.—Not later 

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

19 the Secretary of Labor, in collaboration with the Secretary 

20 of Energy and the Secretary of Education, shall develop 

21 an internet based information and resources clearinghouse 

22 to aid career and technical education and job training pro23 grams for the renewable energy sectors. In establishing 

24 the clearinghouse, the Secretary shall— 


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1 (1) collect and provide information that ad2 dresses the consequences of rapid changes in tech3 nology and regional disparities for renewable energy 

4 training programs and provides best practices for 

5 training and education in light of such changes and 

6 disparities; 

7 (2) place an emphasis on facilitating collabora8 tion between the renewable energy industry and job 

9 training programs and on identifying industry and 

10 technological trends and best practices, to better 

11 help job training programs maintain quality and rel12 evance; and 

13 (3) place an emphasis on assisting programs 

14 that cater to high-demand middle-skill, trades, man15 ufacturing, contracting, and consulting careers. 

16 (b) SOLICITATION AND CONSULTATION.—In devel17 oping the clearinghouse pursuant to subsection (a), the 

18 Secretary shall solicit information and expertise from busi19 nesses and organizations in the renewable energy sector 

20 and from institutions of higher education, career and tech21 nical schools, and community colleges that provide train22 ing in the renewable energy sectors. The Secretary shall 

23 solicit a comprehensive peer review of the clearinghouse 

24 by such entities not less than once every 2 years. Nothing 


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1 in this subsection should be interpreted to require the di2 vulgence of proprietary or competitive information. 

3 (c) CONTENTS OF CLEARINGHOUSE.— 

4 (1) SEPARATE SECTION FOR EACH RENEWABLE

5 ENERGY SECTOR.—The clearinghouse shall contain 

6 separate sections developed for each of the following 

7 renewable energy sectors: 

8 (A) Solar energy systems. 

9 (B) Wind energy systems. 

10 (C) Energy transmission systems. 

11 (D) Geothermal systems of energy and 

12 heating. 

13 (E) Energy efficiency technical training. 

14 (2) ADDITIONAL REQUIREMENTS.—In addition 

15 to the information required in subsection (a), each 

16 section of the clearinghouse shall include information 

17 on basic environmental science and processes needed 

18 to understand renewable energy systems, Federal 

19 government and industry resources, and points of 

20 contact to aid institutions in the development of 

21 placement programs for apprenticeships and post 

22 graduation opportunities, and information and tips 

23 about a green workplace, energy efficiency, and rel24 evant environmental topics and information on avail25 able industry recognized certifications in each area. 


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1 (d) DISSEMINATION.—The clearinghouse shall be 

2 made available via the Internet to the general public. No3 tice of the completed clearinghouse and any major revi4 sions thereto shall also be provided— 

5 (1) to each Member of Congress; and 

6 (2) on the websites of the Departments of Edu7 cation, Energy, and Labor. 

8 (e) REVISION.—The Secretary of Labor shall revise 

9 and update the clearinghouse on a regular basis to ensure 

10 its relevance. 

11 SEC. 303. GREEN CONSTRUCTION CAREERS DEMONSTRA12 TION PROJECT. 

13 (a) ESTABLISHMENT AND AUTHORITY.—The Sec14 retary of Labor, in consultation with the Secretary of En15 ergy, shall, not later than 180 days after the enactment 

16 of this Act, establish a Green Construction Careers dem17 onstration project by rules, regulations, and guidance in 

18 accordance with the provisions of this section. The purpose 

19 of the demonstration project shall be to promote middle 

20 class careers and quality employment practices in the 

21 green construction sector among targeted workers and to 

22 advance efficiency and performance on construction 

23 projects related to this Act. In order to advance these pur24 poses, the Secretary shall identify projects, including resi25 dential retrofitting projects, funded directly by or assisted 


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1 in whole or in part by or through the Federal Government 

2 pursuant to this Act or by any other entity established 

3 in accordance with this Act, to which all of the following 

4 shall apply. 

5 (b) REQUIREMENTS.—The Secretaries may establish 

6 such terms and conditions for the demonstration projects 

7 as the Secretaries determine are necessary to meet the 

8 purposes of subsection (a), including establishing min9 imum proportions of hours to be worked by targeted work10 ers on such projects. The Secretaries may require the con11 tractors and subcontractors performing construction serv12 ices on the project to comply with the terms and conditions 

13 as a condition of receiving funding or assistance from the 

14 Federal Government under this Act. 

15 (c) EVALUATION.—The Secretaries shall evaluate the 

16 demonstration projects against the purposes of this section 

17 at the end of 3 years from initiation of the demonstration 

18 project. If the Secretaries determine that the demonstra19 tion projects have been successful, the Secretaries may 

20 identify further projects to which of the provisions of this 

21 section shall apply. 

22 (d) GAO REPORT.—The Comptroller General shall 

23 prepare and submit a report to the Committee on Health, 

24 Education, Labor, and Pensions and the Committee on 

25 Energy and Natural Resources of the Senate and the 


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1 Committee on Education and Labor and the Committee 

2 on Energy and Commerce of the House of Representatives 

3 not later than 5 years after the date of enactment of this 

4 Act, which shall advise the committees of the results of 

5 the demonstration projects and make appropriate rec6 ommendations. 

7 (e) DEFINITION AND DESIGNATION OF TARGETED

8 WORKERS.—As used in this section, the term ‘‘targeted 

9 worker’’ means an individual who resides in the same 

10 labor market area (as defined in section 101(18) of the 

11 Workforce Investment Act of 1998 (29 U.S.C. 2801(18))) 

12 as the project and who— 

13 (1) is a member of a targeted group, within the 

14 meaning of section 51 of the Internal Revenue Code 

15 of 1986, other than an individual described in sub16 section (d)(1)(C) of such section; 

17 (2)(A) resides in a census tract in which not 

18 less than 20 percent of the households have incomes 

19 below the Federal poverty guidelines; or 

20 (B) is a member of a family that received a 

21 total family income that, during the 2-year period 

22 prior to employment on the project or admission to 

23 the pre-apprenticeship program, did not exceed 200 

24 percent of the Federal poverty guidelines (exclusive 

25 of unemployment compensation, child support payVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00226 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 ments, payments described in section 101(25)(A) of 

2 the Workforce Investment Act (29 U.S.C. 

3 2801(25)(A)), and old-age and survivors insurance 

4 benefits received under section 202 of the Social Se5 curity Act (42 U.S.C. 402); or 

6 (3) is a displaced homemaker, as such term is 

7 defined in section 3(10) of the Carl D. Perkins Ca8 reer and Technical Education Act of 2006 (20 

9 U.S.C. 2302(10)). 

10 (f) QUALIFIED PRE-APPRENTICESHIP PROGRAM.—A 

11 qualified pre-apprenticeship program is a pre-apprentice12 ship program that has demonstrated an ability to recruit, 

13 train, and prepare for admission to apprenticeship pro14 grams individuals who are targeted workers. 

15 (g) QUALIFIED APPRENTICESHIP AND OTHER

16 TRAINING PROGRAMS.— 

17 (1) PARTICIPATION BY EACH CONTRACTOR RE18 QUIRED.—Each contractor and subcontractor that 

19 seeks to provide construction services on projects 

20 identified by the Secretaries pursuant to subsection 

21 (a) shall submit adequate assurances with its bid or 

22 proposal that it participates in a qualified appren23 ticeship or other training program, with a written 

24 arrangement with a qualified pre-apprenticeship pro25 gram, for each craft or trade classification of worker 


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1 that it intends to employ to perform work on the 

2 project. 

3 (2) DEFINITION OF QUALIFIED APPRENTICE

4 SHIP OR OTHER TRAINING PROGRAM.— 

5 (A) IN GENERAL.—For purposes of this 

6 section, the term ‘‘qualified apprenticeship or 

7 other training program’’ means an apprentice8 ship or other training program that qualifies as 

9 an employee welfare benefit plan, as defined in 

10 section 3(1) of the Employee Retirement In11 come Security Act of 1974 (29 U.S.C. 

12 1002(1)). 

13 (B) CERTIFICATION OF OTHER PROGRAMS

14 IN CERTAIN LOCALITIES.—In the event that the 

15 Secretary of Labor certifies that a qualified ap16 prenticeship or other training program (as de17 fined in subparagraph (A)) for a craft or trade 

18 classification of workers that a prospective con19 tractor or subcontractor intends to employ, is 

20 not operated in the locality where the project 

21 will be performed, an apprenticeship or other 

22 training program that is not an employee wel23 fare benefit plan (as defined in such section) 

24 may be certified by the Secretary as a qualified 

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1 vided it is registered with the Office of Appren2 ticeship of the Department of Labor, or a State 

3 apprenticeship agency recognized by the Office 

4 of Apprenticeship for Federal purposes. 

5 (h) FACILITATING COMPLIANCE.—The Secretary 

6 may require Federal contracting agencies, recipients of 

7 Federal assistance, and any other entity established in ac8 cordance with this Act to require contractors to enter into 

9 an agreement in a manner comparable with the standards 

10 set forth in sections 3 and 4 of Executive Order 13502 

11 in order to achieve the purposes of this section, including 

12 any requirements established by subsection (b). 

13 (i) LIMITATION.—The requirements of this section 

14 shall not apply to any project funded under this Act in 

15 American Samoa, Guam, the Commonwealth of the North16 ern Mariana Islands, the Commonwealth of Puerto Rico, 

17 or the United States Virgin Islands, unless participation 

18 is requested by the governor of such territories within 1 

19 year of the promulgation of rules under this Act. 

20 PART 2—CLIMATE CHANGE WORKER 

21 ADJUSTMENT ASSISTANCE 

22 SEC. 311. PETITIONS, ELIGIBILITY REQUIREMENTS, AND 

23 DETERMINATIONS. 

24 (a) PETITIONS.— 


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1 (1) FILING.—A petition for certification of eli2 gibility to apply for adjustment assistance for a 

3 group of workers under this part may be filed by 

4 any of the following: 

5 (A) The group of workers. 

6 (B) The certified or recognized union or 

7 other duly authorized representative of such 

8 workers. 

9 (C) Employers of such workers, one-stop 

10 operators or one-stop partners (as defined in 

11 section 101 of the Workforce Investment Act of 

12 1998 (29 U.S.C. 2801)), including State em13 ployment security agencies, or the State dis14 located worker unit established under title I of 

15 such Act, on behalf of such workers. 

16 The petition shall be filed simultaneously with the 

17 Secretary of Labor and with the Governor of the 

18 State in which such workers’ employment site is lo19 cated. 

20 (2) ACTION BY GOVERNORS.—Upon receipt of a 

21 petition filed under paragraph (1), the Governor 

22 shall— 

23 (A) ensure that rapid response activities 

24 and appropriate core and intensive services (as 

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1 vestment Act of 1998 (29 U.S.C. 2864)) au2 thorized under other Federal laws are made 

3 available to the workers covered by the petition 

4 to the extent authorized under such laws; and 

5 (B) assist the Secretary in the review of 

6 the petition by verifying such information and 

7 providing such other assistance as the Secretary 

8 may request. 

9 (3) ACTION BY THE SECRETARY.—Upon receipt 

10 of the petition, the Secretary shall promptly publish 

11 notice in the Federal Register and on the website of 

12 the Department of Labor that the Secretary has re13 ceived the petition and initiated an investigation. 

14 (4) HEARINGS.—If the petitioner, or any other 

15 person found by the Secretary to have a substantial 

16 interest in the proceedings, submits not later than 

17 10 days after the date of the Secretary’s publication 

18 under paragraph (3) a request for a hearing, the 

19 Secretary shall provide for a public hearing and af20 ford such interested persons an opportunity to be 

21 present, to produce evidence, and to be heard. 

22 (b) ELIGIBILITY.— 

23 (1) IN GENERAL.—A group of workers shall be 

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1 justment assistance under this part pursuant to a 

2 petition filed under subsection (a) if— 

3 (A) the group of workers is employed in— 

4 (i) energy producing and transforming 

5 industries; 

6 (ii) industries dependent upon energy 

7 industries; 

8 (iii) energy-intensive manufacturing 

9 industries; 

10 (iv) consumer goods manufacturing; 

11 or 

12 (v) other industries whose employment 

13 the Secretary determines has been ad14 versely affected by any requirement of title 

15 VII of the Clean Air Act; 

16 (B) the Secretary determines that a sig17 nificant number or proportion of the workers in 

18 such workers’ employment site have become to19 tally or partially separated, or are threatened to 

20 become totally or partially separated from em21 ployment; and 

22 (C) the sales, production, or delivery of 

23 goods or services have decreased as a result of 

24 any requirement of title VII of the Clean Air 

25 Act, including— 


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1 (i) the shift from reliance upon fossil 

2 fuels to other sources of energy, including 

3 renewable energy, that results in the clos4 ing of a facility or layoff of employees at 

5 a facility that mines, produces, processes, 

6 or utilizes fossil fuels to generate elec7 tricity; 

8 (ii) a substantial increase in the cost 

9 of energy required for a manufacturing fa10 cility to produce items whose prices are 

11 competitive in the marketplace, to the ex12 tent the cost is not offset by assistance 

13 provided to the facility pursuant to title 

14 VII of the Clean Air Act; or 

15 (iii) other documented occurrences 

16 that the Secretary determines are indica17 tors of an adverse impact on an industry 

18 described in subparagraph (A) as a result 

19 of any requirement of title VII of the 

20 Clean Air Act. 

21 (2) WORKERS IN PUBLIC AGENCIES.—A group 

22 of workers in a public agency shall be certified by 

23 the Secretary as eligible to apply for climate change 

24 adjustment assistance pursuant to a petition filed if 

25 the Secretary determines that a significant number 


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1 or proportion of the workers in the public agency 

2 have become totally or partially separated from em3 ployment, or are threatened to become totally or 

4 partially separated as a result of any requirement of 

5 title VII of the Clean Air Act. 

6 (3) ADVERSELY AFFECTED SERVICE WORK7 ERS.—A group of workers shall be certified as eligi8 ble to apply for climate change adjustment assist9 ance pursuant to a petition filed if the Secretary de10 termines that— 

11 (A) a significant number or proportion of 

12 the service workers at an employment site 

13 where a group of workers has been certified by 

14 the Secretary as eligible to apply for adjustment 

15 assistance under this part pursuant to para16 graph (1) have become totally or partially sepa17 rated from employment, or are threatened to 

18 become totally or partially separated; and 

19 (B) a loss of business in the firm providing 

20 service workers to an employment site is di21 rectly attributable to one or more of the docu22 mented occurrences listed in paragraph (1)(C). 

23 (c) AUTHORITY TO INVESTIGATE AND COLLECT IN24 FORMATION.— 


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1 (1) IN GENERAL.—The Secretary shall, in de2 termining whether to certify a group of workers 

3 under subsection (d), obtain information the Sec4 retary determines to be necessary to make the cer5 tification, through questionnaires and in such other 

6 manner as the Secretary determines appropriate 

7 from— 

8 (A) the workers’ employer; 

9 (B) officials of certified or recognized 

10 unions or other duly authorized representatives 

11 of the group of workers; or 

12 (C) one-stop operators or one-stop partners 

13 (as defined in section 101 of the Workforce In14 vestment Act of 1998 (29 U.S.C. 2801)). 

15 (2) VERIFICATION OF INFORMATION.—The Sec16 retary shall require an employer, union, or one-stop 

17 operator or partner to certify all information ob18 tained under paragraph (1) from the employer, 

19 union, or one-stop operator or partner (as the case 

20 may be) on which the Secretary relies in making a 

21 determination under subsection (d), unless the Sec22 retary has a reasonable basis for determining that 

23 such information is accurate and complete without 

24 being certified. 


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1 (3) PROTECTION OF CONFIDENTIAL INFORMA2 TION.—The Secretary may not release information 

3 obtained under paragraph (1) that the Secretary 

4 considers to be confidential business information un5 less the employer submitting the confidential busi6 ness information had notice, at the time of submis7 sion, that the information would be released by the 

8 Secretary, or the employer subsequently consents to 

9 the release of the information. Nothing in this para10 graph shall be construed to prohibit the Secretary 

11 from providing such confidential business informa12 tion to a court in camera or to another party under 

13 a protective order issued by a court. 

14 (d) DETERMINATION BY THE SECRETARY OF

15 LABOR.— 

16 (1) IN GENERAL.—As soon as possible after the 

17 date on which a petition is filed under subsection 

18 (a), but in any event not later than 40 days after 

19 that date, the Secretary, in consultation with the 

20 Secretary of Energy and the Administrator, as nec21 essary, shall determine whether the petitioning 

22 group meets the requirements of subsection (b) and 

23 shall issue a certification of eligibility to apply for 

24 assistance under this part covering workers in any 

25 group which meets such requirements. Each certifiVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00236 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 cation shall specify the date on which the total or 

2 partial separation began or threatened to begin. 

3 Upon reaching a determination on a petition, the 

4 Secretary shall promptly publish a summary of the 

5 determination in the Federal Register and on the 

6 website of the Department of Labor, together with 

7 the Secretary’s reasons for making such determina8 tion. 

9 (2) ONE-YEAR LIMITATION.—A certification 

10 under this section shall not apply to any worker 

11 whose last total or partial separation from the em12 ployment site before the worker’s application under 

13 section 312(a) occurred more than 1 year before the 

14 date of the petition on which such certification was 

15 granted. 

16 (3) REVOCATION OF CERTIFICATION.—When17 ever the Secretary determines, with respect to any 

18 certification of eligibility of the workers of an em19 ployment site, that total or partial separations from 

20 such site are no longer a result of the factors speci21 fied in subsection (b)(1), the Secretary shall termi22 nate such certification and promptly have notice of 

23 such termination published in the Federal Register 

24 and on the website of the Department of Labor, to25 gether with the Secretary’s reasons for making such 


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1 determination. Such termination shall apply only 

2 with respect to total or partial separations occurring 

3 after the termination date specified by the Secretary. 

4 (e) INDUSTRY NOTIFICATION OF ASSISTANCE.— 

5 Upon receiving a notification of a determination under 

6 subsection (d) with respect to a domestic industry the Sec7 retary of Labor shall notify the representatives of the do8 mestic industry affected by the determination, employers 

9 publicly identified by name during the course of the pro10 ceeding relating to the determination, and any certified 

11 or recognized union or, to the extent practicable, other 

12 duly authorized representative of workers employed by 

13 such representatives of the domestic industry, of— 

14 (1) the adjustment assistance, training, and 

15 other benefits available under this part; 

16 (2) the manner in which to file a petition and 

17 apply for such benefits; 

18 (3) the availability of assistance in filing such 

19 petitions; 

20 (4) notify the Governor of each State in which 

21 one or more employers in such industry are located 

22 of the Secretary’s determination and the identity of 

23 the employers; and 

24 (5) upon request, provide any assistance that is 

25 necessary to file a petition under subsection (a). 


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1 (f) BENEFIT INFORMATION TO WORKERS, PRO2 VIDERS OF TRAINING.— 

3 (1) IN GENERAL.—The Secretary shall provide 

4 full information to workers about the adjustment as5 sistance, training, and other benefits available under 

6 this part and about the petition and application pro7 cedures, and the appropriate filing dates, for such 

8 assistance, training and services. The Secretary shall 

9 provide whatever assistance is necessary to enable 

10 groups of workers to prepare petitions or applica11 tions for program benefits. The Secretary shall make 

12 every effort to insure that cooperating State agen13 cies fully comply with the agreements entered into 

14 under section 312(a) and shall periodically review 

15 such compliance. The Secretary shall inform the 

16 State Board for Vocational Education or equivalent 

17 agency, the one-stop operators or one-stop partners 

18 (as defined in section 101 of the Workforce Invest19 ment Act of 1998 (29 U.S.C. 2801)), and other pub20 lic or private agencies, institutions, and employers, 

21 as appropriate, of each certification issued under 

22 subsection (d) and of projections, if available, of the 

23 needs for training under as a result of such certifi24 cation. 


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1 (2) NOTICE BY MAIL.—The Secretary shall pro2 vide written notice through the mail of the benefits 

3 available under this part to each worker whom the 

4 Secretary has reason to believe is covered by a cer5 tification made under subsection (d)— 

6 (A) at the time such certification is made, 

7 if the worker was partially or totally separated 

8 from the adversely affected employment before 

9 such certification; or 

10 (B) at the time of the total or partial sepa11 ration of the worker from the adversely affected 

12 employment, if subparagraph (A) does not 

13 apply. 

14 (3) NEWSPAPERS; WEBSITE.—The Secretary 

15 shall publish notice of the benefits available under 

16 this part to workers covered by each certification 

17 made under subsection (d) in newspapers of general 

18 circulation in the areas in which such workers reside 

19 and shall make such information available on the 

20 website of the Department of Labor. 

21 SEC. 312. PROGRAM BENEFITS. 

22 (a) CLIMATE CHANGE ADJUSTMENT ASSISTANCE.— 

23 (1) ELIGIBILITY.—Payment of climate change 

24 adjustment assistance shall be made to an adversely 

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1 tion 311(b) who files an application for such assist2 ance for any week of unemployment which begins on 

3 or after the date of such certification, if the fol4 lowing conditions are met: 

5 (A) Such worker’s total or partial separa6 tion before the worker’s application under this 

7 part occurred— 

8 (i) on or after the date, as specified in 

9 the certification under which the worker is 

10 covered, on which total or partial separa11 tion began or threatened to begin in the 

12 adversely affected employment; 

13 (ii) before the expiration of the 2-year 

14 period beginning on the date on which the 

15 determination under section 311(d) was 

16 made; and 

17 (iii) before the termination date, if 

18 any, determined pursuant to section 

19 311(d)(3). 

20 (B) Such worker had, in the 52-week pe21 riod ending with the week in which such total 

22 or partial separation occurred, at least 26 

23 weeks of full-time employment or 1,040 hours 

24 of part time employment in adversely affected 

25 employment, or, if data with respect to weeks of 


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1 employment are not available, equivalent 

2 amounts of employment computed under regu3 lations prescribed by the Secretary. For the 

4 purposes of this paragraph, any week in which 

5 such worker— 

6 (i) is on employer-authorized leave for 

7 purposes of vacation, sickness, injury, ma8 ternity, or inactive duty or active duty 

9 military service for training; 

10 (ii) does not work because of a dis11 ability that is compensable under a work12 men’s compensation law or plan of a State 

13 or the United States; 

14 (iii) had his employment interrupted 

15 in order to serve as a full-time representa16 tive of a labor organization in such firm; or 

17 (iv) is on call-up for purposes of active 

18 duty in a reserve status in the Armed 

19 Forces of the United States, provided such 

20 active duty is ‘‘Federal service’’ as defined 

21 in section 8521(a)(1) of title 5, United 

22 States Code, 

23 shall be treated as a week of employment. 


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1 (C) Such worker is enrolled in a training 

2 program approved by the Secretary under sub3 section (b)(2). 

4 (2) INELIGIBILITY FOR CERTAIN OTHER BENE5 FITS.—An adversely affected worker receiving a pay6 ment under this section shall be ineligible to receive 

7 any other form of unemployment insurance for the 

8 period in which such worker is receiving climate 

9 change adjustment assistance under this section. 

10 (3) REVOCATION.—If— 

11 (A) the Secretary determines that— 

12 (i) the adversely affected worker— 

13 (I) has failed to begin participa14 tion in the training program the en15 rollment in which meets the require16 ment of paragraph (1)(C); or 

17 (II) has ceased to participate in 

18 such training program before com19 pleting such training program; and 

20 (ii) there is no justifiable cause for 

21 such failure or cessation; or 

22 (B) the certification made with respect to 

23 such worker under section 311(d) is revoked 

24 under paragraph (3) of such section, 


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1 no adjustment assistance may be paid to the ad2 versely affected worker under this part for the week 

3 in which such failure, cessation, or revocation oc4 curred, or any succeeding week, until the adversely 

5 affected worker begins or resumes participation in a 

6 training program approved by the Secretary under 

7 subsection (b)(2). 

8 (4) WAIVERS OF TRAINING REQUIREMENTS.— 

9 The Secretary may issue a written statement to an 

10 adversely affected worker waiving the requirement to 

11 be enrolled in training described in subsection (b)(2) 

12 if the Secretary determines that it is not feasible or 

13 appropriate for the worker, because of 1 or more of 

14 the following reasons: 

15 (A) RECALL.—The worker has been noti16 fied that the worker will be recalled by the em17 ployer from which the separation occurred. 

18 (B) MARKETABLE SKILLS.— 

19 (i) IN GENERAL.—The worker pos20 sesses marketable skills for suitable em21 ployment (as determined pursuant to an 

22 assessment of the worker, which may in23 clude the profiling system under section 

24 303(j) of the Social Security Act (42 

25 U.S.C. 503(j)), carried out in accordance 


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1 with guidelines issued by the Secretary) 

2 and there is a reasonable expectation of 

3 employment at equivalent wages in the 

4 foreseeable future. 

5 (ii) MARKETABLE SKILLS DEFINED.— 

6 For purposes of clause (i), the term ‘‘mar7 ketable skills’’ may include the possession 

8 of a postgraduate degree from an institu9 tion of higher education (as defined in sec10 tion 102 of the Higher Education Act of 

11 1965 (20 U.S.C. 1002)) or an equivalent 

12 institution, or the possession of an equiva13 lent postgraduate certification in a special14 ized field. 

15 (C) RETIREMENT.—The worker is within 2 

16 years of meeting all requirements for entitle17 ment to either— 

18 (i) old-age insurance benefits under 

19 title II of the Social Security Act (42 

20 U.S.C. 401 et seq.) (except for application 

21 therefor); or 

22 (ii) a private pension sponsored by an 

23 employer or labor organization. 

24 (D) HEALTH.—The worker is unable to 

25 participate in training due to the health of the 


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1 worker, except that a waiver under this sub2 paragraph shall not be construed to exempt a 

3 worker from requirements relating to the avail4 ability for work, active search for work, or re5 fusal to accept work under Federal or State un6 employment compensation laws. 

7 (E) ENROLLMENT UNAVAILABLE.—The 

8 first available enrollment date for the training 

9 of the worker is within 60 days after the date 

10 of the determination made under this para11 graph, or, if later, there are extenuating cir12 cumstances for the delay in enrollment, as de13 termined pursuant to guidelines issued by the 

14 Secretary. 

15 (F) TRAINING NOT AVAILABLE.—Training 

16 described in subsection (b)(2) is not reasonably 

17 available to the worker from either govern18 mental agencies or private sources (which may 

19 include area career and technical education 

20 schools, as defined in section 3 of the Carl D. 

21 Perkins Career and Technical Education Act of 

22 2006 (20 U.S.C. 2302), and employers), no 

23 training that is suitable for the worker is avail24 able at a reasonable cost, or no training funds 

25 are available. 


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1 (5) WEEKLY AMOUNTS.—The climate change 

2 adjustment assistance payable to an adversely af3 fected worker for a week of unemployment shall be 

4 an amount equal to 70 percent of the average weekly 

5 wage of such worker, but in no case shall such 

6 amount exceed the average weekly wage for all work7 ers in the State where the adversely affected worker 

8 resides. 

9 (6) MAXIMUM DURATION OF BENEFITS.—An el10 igible worker may receive a climate change adjust11 ment assistance under this subsection for a period of 

12 not longer than 156 weeks. 

13 (b) EMPLOYMENT SERVICES AND TRAINING.— 

14 (1) INFORMATION AND EMPLOYMENT SERV15 ICES.—The Secretary shall make available, directly 

16 or through agreements with the States under section 

17 313(a) to adversely affected workers covered by a 

18 certification under section 311(a) the following in19 formation and employment services: 

20 (A) Comprehensive and specialized assess21 ment of skill levels and service needs, including 

22 through— 

23 (i) diagnostic testing and use of other 

24 assessment tools; and 


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1 (ii) in-depth interviewing and evalua2 tion to identify employment barriers and 

3 appropriate employment goals. 

4 (B) Development of an individual employ5 ment plan to identify employment goals and ob6 jectives, and appropriate training to achieve 

7 those goals and objectives. 

8 (C) Information on training available in 

9 local and regional areas, information on indi10 vidual counseling to determine which training is 

11 suitable training, and information on how to 

12 apply for such training. 

13 (D) Information on training programs and 

14 other services provided by a State pursuant to 

15 title I of the Workforce Investment Act of 1998 

16 (29 U.S.C. 2801 et seq.) and available in local 

17 and regional areas, information on individual 

18 counseling to determine which training is suit19 able training, and information on how to apply 

20 for such training. 

21 (E) Information on how to apply for finan22 cial aid, including referring workers to edu23 cational opportunity centers described in section 

24 402F of the Higher Education Act of 1965 (20 

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1 fying workers that the workers may request fi2 nancial aid administrators at institutions of 

3 higher education (as defined in section 102 of 

4 such Act (20 U.S.C. 1002)) to use the adminis5 trators’ discretion under section 479A of such 

6 Act (20 U.S.C. 1087tt) to use current year in7 come data, rather than preceding year income 

8 data, for determining the amount of need of the 

9 workers for Federal financial assistance under 

10 title IV of such Act (20 U.S.C. 1070 et seq.). 

11 (F) Short-term prevocational services, in12 cluding development of learning skills, commu13 nications skills, interviewing skills, punctuality, 

14 personal maintenance skills, and professional 

15 conduct to prepare individuals for employment 

16 or training. 

17 (G) Individual career counseling, including 

18 job search and placement counseling, during the 

19 period in which the individual is receiving cli20 mate change adjustment assistance or training 

21 under this part, and after receiving such train22 ing for purposes of job placement. 

23 (H) Provision of employment statistics in24 formation, including the provision of accurate 


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1 information relating to local, regional, and na2 tional labor market areas, including— 

3 (i) job vacancy listings in such labor 

4 market areas; 

5 (ii) information on jobs skills nec6 essary to obtain jobs identified in job va7 cancy listings described in subparagraph 

8 (A); 

9 (iii) information relating to local occu10 pations that are in demand and earnings 

11 potential of such occupations; and 

12 (iv) skills requirements for local occu13 pations described in subparagraph (C). 

14 (I) Information relating to the availability 

15 of supportive services, including services relat16 ing to child care, transportation, dependent 

17 care, housing assistance, and need-related pay18 ments that are necessary to enable an indi19 vidual to participate in training. 

20 (2) TRAINING.— 

21 (A) APPROVAL OF AND PAYMENT FOR

22 TRAINING.—If the Secretary determines, with 

23 respect to an adversely affected worker that— 

24 (i) there is no suitable employment 

25 (which may include technical and profesVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00250 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 sional employment) available for an ad2 versely affected worker; 

3 (ii) the worker would benefit from ap4 propriate training; 

5 (iii) there is a reasonable expectation 

6 of employment following completion of 

7 such training; 

8 (iv) training approved by the Sec9 retary is reasonably available to the worker 

10 from either governmental agencies or pri11 vate sources (including area career and 

12 technical education schools, as defined in 

13 section 3 of the Carl D. Perkins Career 

14 and Technical Education Act of 2006 (20 

15 U.S.C. 2302), and employers); 

16 (v) the worker is qualified to under17 take and complete such training; and 

18 (vi) such training is suitable for the 

19 worker and available at a reasonable cost, 

20 the Secretary shall approve such training for 

21 the worker. Upon such approval, the worker 

22 shall be entitled to have payment of the costs 

23 of such training (subject to the limitations im24 posed by this section) paid on the worker’s beVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00251 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 half by the Secretary directly or through a 

2 voucher system. 

3 (B) DISTRIBUTION.—The Secretary shall 

4 establish procedures for the distribution of the 

5 funds to States to carry out the training pro6 grams approved under this paragraph, and shall 

7 make an initial distribution of the funds made 

8 available as soon as practicable after the begin9 ning of each fiscal year. 

10 (C) ADDITIONAL RULES REGARDING AP11 PROVAL OF AND PAYMENT FOR TRAINING.— 

12 (i) For purposes of applying subpara13 graph (A)(iii), a reasonable expectation of 

14 employment does not require that employ15 ment opportunities for a worker be avail16 able, or offered, immediately upon the 

17 completion of training approved under 

18 such subparagraph. 

19 (ii) If the costs of training an ad20 versely affected worker are paid by the 

21 Secretary under subparagraph (A), no 

22 other payment for such costs may be made 

23 under any other provision of Federal law. 

24 No payment may be made under subpara25 graph (A) of the costs of training an adVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00252 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 versely affected worker or an adversely af2 fected incumbent worker if such costs— 

3 (I) have already been paid under 

4 any other provision of Federal law; or 

5 (II) are reimbursable under any 

6 other provision of Federal law and a 

7 portion of such costs have already 

8 been paid under such other provision 

9 of Federal law. 

10 The provisions of this clause shall not 

11 apply to, or take into account, any funds 

12 provided under any other provision of Fed13 eral law which are used for any purpose 

14 other than the direct payment of the costs 

15 incurred in training a particular adversely 

16 affected worker, even if such use has the 

17 effect of indirectly paying or reducing any 

18 portion of the costs involved in training the 

19 adversely affected worker. 

20 (D) TRAINING PROGRAMS.—The training 

21 programs that may be approved under subpara22 graph (A) include— 

23 (i) employer-based training, includ24 ing— 


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1 (I) on-the-job training if ap2 proved by the Secretary under sub3 section (c); and 

4 (II) joint labor-management ap5 prenticeship programs; 

6 (ii) any training program provided by 

7 a State pursuant to title I of the Work8 force Investment Act of 1998 (29 U.S.C. 

9 2801 et seq.); 

10 (iii) any programs in career and tech11 nical education described in section 3(5) of 

12 the Carl D. Perkins Career and Technical 

13 Education Act of 2006 (20 U.S.C. 

14 2302(5)); 

15 (iv) any program of remedial edu16 cation; 

17 (v) any program of prerequisite edu18 cation or coursework required to enroll in 

19 training that may be approved under this 

20 paragraph; 

21 (vi) any training program for which 

22 all, or any portion, of the costs of training 

23 the worker are paid— 

24 (I) under any Federal or State 

25 program other than this part; or 


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1 (II) from any source other than 

2 this part; 

3 (vii) any training program or 

4 coursework at an accredited institution of 

5 higher education (described in section 102 

6 of the Higher Education Act of 1965 (20 

7 U.S.C. 1002)), including a training pro8 gram or coursework for the purpose of— 

9 (I) obtaining a degree or certifi10 cation; or 

11 (II) completing a degree or cer12 tification that the worker had pre13 viously begun at an accredited institu14 tion of higher education; and 

15 (viii) any other training program ap16 proved by the Secretary. 

17 (3) SUPPLEMENTAL ASSISTANCE.—The Sec18 retary may, as appropriate, authorize supplemental 

19 assistance that is necessary to defray reasonable 

20 transportation and subsistence expenses for separate 

21 maintenance in a case in which training for a worker 

22 is provided in a facility that is not within commuting 

23 distance of the regular place of residence of the 

24 worker. 

25 (c) ON-THE-JOB TRAINING REQUIREMENTS.— 


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1 (1) IN GENERAL.—The Secretary may approve 

2 on-the-job training for any adversely affected worker 

3 if— 

4 (A) the Secretary determines that on-the5 job training— 

6 (i) can reasonably be expected to lead 

7 to suitable employment with the employer 

8 offering the on-the-job training; 

9 (ii) is compatible with the skills of the 

10 worker; 

11 (iii) includes a curriculum through 

12 which the worker will gain the knowledge 

13 or skills to become proficient in the job for 

14 which the worker is being trained; and 

15 (iv) can be measured by benchmarks 

16 that indicate that the worker is gaining 

17 such knowledge or skills; and 

18 (B) the State determines that the on-the19 job training program meets the requirements of 

20 clauses (iii) and (iv) of subparagraph (A). 

21 (2) MONTHLY PAYMENTS.—The Secretary shall 

22 pay the costs of on-the-job training approved under 

23 paragraph (1) in monthly installments. 

24 (3) CONTRACTS FOR ON-THE-JOB TRAINING.— 


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1 (A) IN GENERAL.—The Secretary shall en2 sure, in entering into a contract with an em3 ployer to provide on-the-job training to a work4 er under this subsection, that the skill require5 ments of the job for which the worker is being 

6 trained, the academic and occupational skill 

7 level of the worker, and the work experience of 

8 the worker are taken into consideration. 

9 (B) TERM OF CONTRACT.—Training under 

10 any such contract shall be limited to the period 

11 of time required for the worker receiving on12 the-job training to become proficient in the job 

13 for which the worker is being trained, but may 

14 not exceed 156 weeks in any case. 

15 (4) EXCLUSION OF CERTAIN EMPLOYERS.—The 

16 Secretary shall not enter into a contract for on-the17 job training with an employer that exhibits a pattern 

18 of failing to provide workers receiving on-the-job 

19 training from the employer with— 

20 (A) continued, long-term employment as 

21 regular employees; and 

22 (B) wages, benefits, and working condi23 tions that are equivalent to the wages, benefits, 

24 and working conditions provided to regular em25 ployees who have worked a similar period of 


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1 time and are doing the same type of work as 

2 workers receiving on-the-job training from the 

3 employer. 

4 (d) ADMINISTRATIVE AND EMPLOYMENT SERVICES

5 FUNDING.— 

6 (1) ADMINISTRATIVE FUNDING.—In addition to 

7 any funds made available to a State to carry out this 

8 section for a fiscal year, the State shall receive for 

9 the fiscal year a payment in an amount that is equal 

10 to 15 percent of the amount of such funds and 

11 shall— 

(A) use not more than 2 12 ⁄3 of such payment 

13 for the administration of the climate change ad14 justment assistance for workers program under 

15 this part, including for— 

16 (i) processing waivers of training re17 quirements under subsection (a)(4); and 

18 (ii) collecting, validating, and report19 ing data required under this part; and 

(B) use not less than 1 20 ⁄3 of such payment 

21 for information and employment services under 

22 subsection (b)(1). 

23 (2) EMPLOYMENT SERVICES FUNDING.— 

24 (A) IN GENERAL.—In addition to any 

25 funds made available to a State to carry out 


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1 subsection (b)(2) and the payment under para2 graph (1) for a fiscal year, the Secretary shall 

3 provide to the State for the fiscal year a reason4 able payment for the purpose of providing em5 ployment and services under subsection (b)(1). 

6 (B) VOLUNTARY RETURN OF FUNDS.—A 

7 State that receives a payment under subpara8 graph (A) may decline or otherwise return such 

9 payment to the Secretary. 

10 (e) JOB SEARCH ASSISTANCE.—The Secretary of 

11 Labor may provide adversely affected workers one-time 

12 job search assistance in accordance with regulations pre13 scribed by the Secretary. Any job search assistance pro14 vided shall be available only under the following cir15 cumstances and conditions: 

16 (1) The worker is no longer eligible for the cli17 mate change adjustment assistance under subsection 

18 (a) and has completed the training program required 

19 by subsection (b)(1)(E). 

20 (2) The Secretary determines that the worker 

21 cannot reasonably be expected to secure suitable em22 ployment in the commuting area in which the worker 

23 resides. 

24 (3) Assistance granted shall provide reimburse25 ment to the worker of all necessary job search exVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00259 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 penses as prescribed by the Secretary in regulations. 

2 Such reimbursement under this subsection may not 

3 exceed $1,500 for any worker. 

4 (f) RELOCATION ASSISTANCE AUTHORIZED.— 

5 (1) IN GENERAL.—Any adversely affected work6 er covered by a certification issued under section 

7 311 may file an application for relocation assistance 

8 with the Secretary, and the Secretary may grant the 

9 relocation assistance, subject to the terms and condi10 tions of this subsection. 

11 (2) CONDITIONS FOR GRANTING ASSISTANCE.— 

12 Relocation assistance may be granted if all of the 

13 following terms and conditions are met: 

14 (A) ASSIST AN ADVERSELY AFFECTED

15 WORKER.—The relocation assistance will assist 

16 an adversely affected worker in relocating with17 in the United States. 

18 (B) LOCAL EMPLOYMENT NOT AVAIL19 ABLE.—The Secretary determines that the 

20 worker cannot reasonably be expected to secure 

21 suitable employment in the commuting area in 

22 which the worker resides. 

23 (C) TOTAL SEPARATION.—The worker is 

24 totally separated from employment at the time 

25 relocation commences. 


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1 (D) SUITABLE EMPLOYMENT OBTAINED.— 

2 The worker— 

3 (i) has obtained suitable employment 

4 affording a reasonable expectation of long5 term duration in the area in which the 

6 worker wishes to relocate; or 

7 (ii) has obtained a bona fide offer of 

8 such employment. 

9 (E) APPLICATION.—The worker filed an 

10 application with the Secretary at such time and 

11 in such manner as the Secretary shall specify 

12 by regulation. 

13 (3) AMOUNT OF ASSISTANCE.—Relocation as14 sistance granted to a worker under paragraph (1) 

15 includes— 

16 (A) all reasonable and necessary expenses 

17 (including, subsistence and transportation ex18 penses at levels not exceeding amounts pre19 scribed by the Secretary in regulations) in20 curred in transporting the worker, the worker’s 

21 family, and household effects; and 

22 (B) a lump sum equivalent to 3 times the 

23 worker’s average weekly wage, up to a max24 imum payment of $1,500. 


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1 (4) LIMITATIONS.—Relocation assistance may 

2 not be granted to a worker unless— 

3 (A) the relocation occurs within 182 days 

4 after the filing of the application for relocation 

5 assistance; or 

6 (B) the relocation occurs within 182 days 

7 after the conclusion of training, if the worker 

8 entered a training program approved by the 

9 Secretary under subsection (b)(2). 

10 (g) HEALTH INSURANCE CONTINUATION.—Not later 

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

12 Secretary of Labor shall prescribe regulations to provide, 

13 for the period in which an adversely affected worker is 

14 participating in a training program described in sub15 section (b)(2), 80 percent of the monthly premium of any 

16 health insurance coverage that an adversely affected work17 er was receiving from such worker’s employer prior to the 

18 separation from employment described in section 311(b), 

19 to be paid to any health care insurance plan designated 

20 by the adversely affected worker receiving assistance 

21 under this section. 

22 SEC. 313. GENERAL PROVISIONS. 

23 (a) AGREEMENTS WITH STATES.— 

24 (1) IN GENERAL.—The Secretary is authorized 

25 on behalf of the United States to enter into an 


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1 agreement with any State, or with any State agency 

2 (referred to in this section as ‘‘cooperating States’’ 

3 and ‘‘cooperating State agencies’’ respectively). 

4 Under such an agreement, the cooperating State or 

5 cooperating State agency— 

6 (A) as agent of the United States, shall re7 ceive applications for, and shall provide, pay8 ments on the basis provided in this part; 

9 (B) in accordance with paragraph (6), 

10 shall make available to adversely affected work11 ers covered by a certification under section 

12 311(d) the employment services described in 

13 section 312(b)(1); 

14 (C) shall make any certifications required 

15 under section 311(d); and 

16 (D) shall otherwise cooperate with the Sec17 retary and with other State and Federal agen18 cies in providing payments and services under 

19 this part. 

20 Each agreement under this section shall provide the 

21 terms and conditions upon which the agreement may 

22 be amended, suspended, or terminated. 

23 (2) FORM AND MANNER OF DATA.—Each 

24 agreement under this section shall— 


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1 (A) provide the Secretary with the author2 ity to collect any data the Secretary determines 

3 necessary to meet the requirements of this part; 

4 and 

5 (B) specify the form and manner in which 

6 any such data requested by the Secretary shall 

7 be reported. 

8 (3) RELATIONSHIP TO UNEMPLOYMENT INSUR9 ANCE.—Each agreement under this section shall 

10 provide that an adversely affected worker receiving 

11 climate change adjustment assistance under this 

12 part shall not be eligible for unemployment insur13 ance otherwise payable to such worker under the 

14 laws of the State. 

15 (4) REVIEW.—A determination by a cooper16 ating State agency with respect to entitlement to 

17 program benefits under an agreement is subject to 

18 review in the same manner and to the same extent 

19 as determinations under the applicable State law 

20 and only in that manner and to that extent. 

21 (5) COORDINATION.—Any agreement entered 

22 into under this section shall provide for the coordi23 nation of the administration of the provisions for 

24 employment services, training, and supplemental as25 sistance under section 312 and under title I of the 


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1 Workforce Investment Act of 1998 (29 U.S.C. 2801 

2 et seq.) upon such terms and conditions as are es3 tablished by the Secretary in consultation with the 

4 States and set forth in such agreement. Any agency 

5 of the State jointly administering such provisions 

6 under such agreement shall be considered to be a co7 operating State agency for purposes of this part. 

8 (6) RESPONSIBILITIES OF COOPERATING AGEN9 CIES.—Each cooperating State agency shall, in car10 rying out paragraph (1)(B)— 

11 (A) advise each worker who applies for un12 employment insurance of the benefits under this 

13 part and the procedures and deadlines for ap14 plying for such benefits; 

15 (B) facilitate the early filing of petitions 

16 under section 311(a) for any workers that the 

17 agency considers are likely to be eligible for 

18 benefits under this part; 

19 (C) advise each adversely affected worker 

20 to apply for training under section 312(b) be21 fore, or at the same time, the worker applies for 

22 climate change adjustment assistance under 

23 section 312(a); 

24 (D) perform outreach to, intake of, and 

25 orientation for adversely affected workers and 


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1 adversely affected incumbent workers covered 

2 by a certification under section 312(a) with re3 spect to assistance and benefits available under 

4 this part; 

5 (E) make employment services described in 

6 section 312(b)(1) available to adversely affected 

7 workers and adversely affected incumbent work8 ers covered by a certification under section 

9 311(d) and, if funds provided to carry out this 

10 part are insufficient to make such services 

11 available, make arrangements to make such 

12 services available through other Federal pro13 grams; and 

14 (F) provide the benefits and reemployment 

15 services under this part in a manner that is 

16 necessary for the proper and efficient adminis17 tration of this part, including the use of state 

18 agency personnel employed in accordance with a 

19 merit system of personnel administration stand20 ards, including— 

21 (i) making determinations of eligibility 

22 for, and payment of, climate change read23 justment assistance and health care benefit 

24 replacement amounts; 


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1 (ii) developing recommendations re2 garding payments as a bridge to retire3 ment and lump sum payments to pension 

4 plans in accordance with this subsection; 

5 and 

6 (iii) the provision of reemployment 

7 services to eligible workers, including refer8 ral to training services. 

9 (7) SUBMISSION OF CERTAIN INFORMATION.— 

10 In order to promote the coordination of workforce 

11 investment activities in each State with activities 

12 carried out under this part, any agreement entered 

13 into under this section shall provide that the State 

14 shall submit to the Secretary, in such form as the 

15 Secretary may require, the description and informa16 tion described in paragraphs (8) and (14) of section 

17 112(b) of the Workforce Investment Act of 1998 (29 

18 U.S.C. 2822(b)) and a description of the State’s 

19 rapid response activities under section 134(a)(2)(A) 

20 of that Act (29 U.S.C. 2864(a)(2)(A)). 

21 (8) CONTROL MEASURES.— 

22 (A) IN GENERAL.—The Secretary shall re23 quire each cooperating State and cooperating 

24 State agency to implement effective control 

25 measures and to effectively oversee the operVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00267 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 ation and administration of the climate change 

2 adjustment assistance program under this part, 

3 including by means of monitoring the operation 

4 of control measures to improve the accuracy 

5 and timeliness of the data being collected and 

6 reported. 

7 (B) DEFINITION.—For purposes of sub8 paragraph (A), the term ‘‘control measures’’ 

9 means measures that— 

10 (i) are internal to a system used by a 

11 State to collect data; and 

12 (ii) are designed to ensure the accu13 racy and verifiability of such data. 

14 (9) DATA REPORTING.— 

15 (A) IN GENERAL.—Any agreement entered 

16 into under this section shall require the cooper17 ating State or cooperating State agency to re18 port to the Secretary on a quarterly basis com19 prehensive performance accountability data, to 

20 consist of— 

21 (i) the core indicators of performance 

22 described in subparagraph (B)(i); 

23 (ii) the additional indicators of per24 formance described in subparagraph 

25 (B)(ii), if any; and 


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1 (iii) a description of efforts made to 

2 improve outcomes for workers under the 

3 climate change adjustment assistance pro4 gram. 

5 (B) CORE INDICATORS DESCRIBED.— 

6 (i) IN GENERAL.—The core indicators 

7 of performance described in this subpara8 graph are— 

9 (I) the percentage of workers re10 ceiving benefits under this part who 

11 are employed during the second cal12 endar quarter following the calendar 

13 quarter in which the workers cease re14 ceiving such benefits; 

15 (II) the percentage of such work16 ers who are employed in each of the 

17 third and fourth calendar quarters fol18 lowing the calendar quarter in which 

19 the workers cease receiving such bene20 fits; and 

21 (III) the earnings of such work22 ers in each of the third and fourth 

23 calendar quarters following the cal24 endar quarter in which the workers 

25 cease receiving such benefits. 


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1 (ii) ADDITIONAL INDICATORS.—The 

2 Secretary and a cooperating State or co3 operating State agency may agree upon 

4 additional indicators of performance for 

5 the climate change adjustment assistance 

6 program under this part, as appropriate. 

7 (C) STANDARDS WITH RESPECT TO RELI8 ABILITY OF DATA.—In preparing the quarterly 

9 report required by subparagraph (A), each co10 operating State or cooperating State agency 

11 shall establish procedures that are consistent 

12 with guidelines to be issued by the Secretary to 

13 ensure that the data reported are valid and reli14 able. 

15 (10) VERIFICATION OF ELIGIBILITY FOR PRO16 GRAM BENEFITS.— 

17 (A) IN GENERAL.—An agreement under 

18 this section shall provide that the State shall 

19 periodically redetermine that a worker receiving 

20 benefits under this part who is not a citizen or 

21 national of the United States remains in a sat22 isfactory immigration status. Once satisfactory 

23 immigration status has been initially verified 

24 through the immigration status verification sys25 tem described in section 1137(d) of the Social 


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1 Security Act (42 U.S.C. 1320b–7(d)) for pur2 poses of establishing a worker’s eligibility for 

3 unemployment compensation, the State shall 

4 reverify the worker’s immigration status if the 

5 documentation provided during initial 

6 verification will expire during the period in 

7 which that worker is potentially eligible to re8 ceive benefits under this part. The State shall 

9 conduct such redetermination in a timely man10 ner, utilizing the immigration status verification 

11 system described in section 1137(d) of the So12 cial Security Act (42 U.S.C. 1320b–7(d)). 

13 (B) PROCEDURES.—The Secretary shall 

14 establish procedures to ensure the uniform ap15 plication by the States of the requirements of 

16 this paragraph. 

17 (b) ADMINISTRATION ABSENT STATE AGREE18 MENT.— 

19 (1) In any State where there is no agreement 

20 in force between a State or its agency under sub21 section (a), the Secretary shall promulgate regula22 tions for the performance of all necessary functions 

23 under section 312, including provision for a fair 

24 hearing for any worker whose application for pay25 ments is denied. 


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1 (2) A final determination under paragraph (1) 

2 with respect to entitlement to program benefits 

3 under section 312 is subject to review by the courts 

4 in the same manner and to the same extent as is 

5 provided by section 205(g) of the Social Security Act 

6 (42 U.S.C. 405(g)). 

7 (c) PROHIBITION ON CONTRACTING WITH PRIVATE

8 ENTITIES.—Neither the Secretary nor a State may con9 tract with any private for-profit or nonprofit entity for the 

10 administration of the climate change adjustment assist11 ance program under this part. 

12 (d) PAYMENT TO THE STATES.— 

13 (1) IN GENERAL.—The Secretary shall from 

14 time to time certify to the Secretary of the Treasury 

15 for payment to each cooperating State the sums nec16 essary to enable such State as agent of the United 

17 States to make payments provided for by this part. 

18 (2) RESTRICTION.—All money paid a State 

19 under this subsection shall be used solely for the 

20 purposes for which it is paid; and money so paid 

21 which is not used for such purposes shall be re22 turned, at the time specified in the agreement under 

23 this section, to the Secretary of the Treasury. 

24 (3) BONDS.—Any agreement under this section 

25 may require any officer or employee of the State cerVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00272 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 tifying payments or disbursing funds under the 

2 agreement or otherwise participating in the perform3 ance of the agreement, to give a surety bond to the 

4 United States in such amount as the Secretary may 

5 deem necessary, and may provide for the payment of 

6 the cost of such bond from funds for carrying out 

7 the purposes of this part. 

8 (e) LABOR STANDARDS.— 

9 (1) PROHIBITION ON DISPLACEMENT.—An indi10 vidual in an apprenticeship program or on-the-job 

11 training program under this part shall not displace 

12 (including a partial displacement, such as a reduc13 tion in the hours of non-overtime work, wages, or 

14 employment benefits) any employed employee. 

15 (2) PROHIBITION ON IMPAIRMENT OF CON16 TRACTS.—An apprenticeship program or on-the-job 

17 raining program under this Act shall not impair an 

18 existing contract for services or collective bargaining 

19 agreement, and no such activity that would be incon20 sistent with the terms of a collective bargaining 

21 agreement shall be undertaken without the written 

22 concurrence of the labor organization and employer 

23 concerned. 

24 (3) ADDITIONAL STANDARDS.—The Secretary, 

25 or a State acting under an agreement described in 


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1 subsection (a) may pay the costs of on-the-job train2 ing, notwithstanding any other provision of this sec3 tion, only if— 

4 (A) in the case of training which would be 

5 inconsistent with the terms of a collective bar6 gaining agreement, the written concurrence of 

7 the labor organization concerned has been ob8 tained; 

9 (B) the job for which such adversely af10 fected worker is being trained is not being cre11 ated in a promotional line that will infringe in 

12 any way upon the promotional opportunities of 

13 currently employed individuals; 

14 (C) such training is not for the same occu15 pation from which the worker was separated 

16 and with respect to which such worker’s group 

17 was certified pursuant to section 311(d); 

18 (D) the employer is provided reimburse19 ment of not more than 50 percent of the wage 

20 rate of the participant, for the cost of providing 

21 the training and additional supervision related 

22 to the training; and 

23 (E) the employer has not received payment 

24 under with respect to any other on-the-job 

25 training provided by such employer which failed 


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1 to meet the requirements of subparagraphs (A) 

2 through (D). 

3 (f) DEFINITIONS.—As used in this part the following 

4 definitions apply: 

5 (1) The term ‘‘adversely affected employment’’ 

6 means employment at an employment site, if work7 ers at such site are eligible to apply for adjustment 

8 assistance under this part. 

9 (2) The term ‘‘adversely affected worker’’ 

10 means an individual who has been totally or partially 

11 separated from employment and is eligible to apply 

12 for adjustment assistance under this part. 

(3) The term ‘‘average weekly wage’’ means 1 13 ⁄13

14 of the total wages paid to an individual in the quar15 ter in which the individual’s total wages were highest 

16 among the first 4 of the last 5 completed calendar 

17 quarters immediately before the quarter in which oc18 curs the week with respect to which the computation 

19 is made. Such week shall be the week in which total 

20 separation occurred, or, in cases where partial sepa21 ration is claimed, an appropriate week, as defined in 

22 regulations prescribed by the Secretary. 

23 (4) The term ‘‘average weekly hours’’ means 

24 the average hours worked by the individual (exclud25 ing overtime) in the employment from which he has 


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1 been or claims to have been separated in the 52 

2 weeks (excluding weeks during which the individual 

3 was sick or on vacation) preceding the week speci4 fied in the last sentence of paragraph (4). 

5 (5) The term ‘‘benefit period’’ means, with re6 spect to an individual— 

7 (A) the benefit year and any ensuing pe8 riod, as determined under applicable State law, 

9 during which the individual is eligible for reg10 ular compensation, additional compensation, or 

11 extended compensation; or 

12 (B) the equivalent to such a benefit year 

13 or ensuing period provided for under the appli14 cable Federal unemployment insurance law. 

15 (6) The term ‘‘consumer goods manufacturing’’ 

16 means the electrical equipment, appliance, and com17 ponent manufacturing industry and transportation 

18 equipment manufacturing. 

19 (7) The term ‘‘employment site’’ means a single 

20 facility or site of employment. 

21 (8) The term ‘‘energy-intensive manufacturing 

22 industries’’ means all industrial sectors, entities, or 

23 groups of entities that meet the energy or green24 house gas intensity criteria in section 763(b)(2)(A) 


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1 of the Clean Air Act based on the most recent data 

2 available. 

3 (9) The term ‘‘energy producing and trans4 forming industries’’ means the coal mining industry, 

5 oil and gas extraction, electricity power generation, 

6 transmission and distribution, and natural gas dis7 tribution. 

8 (10) The term ‘‘on-the-job training’’ means 

9 training provided by an employer to an individual 

10 who is employed by the employer. 

11 (11) The terms ‘‘partial separation’’ and ‘‘par12 tially separated’’ refer, with respect to an individual 

13 who has not been totally separated, that such indi14 vidual has had— 

15 (A) his or her hours of work reduced to 80 

16 percent or less of his average weekly hours in 

17 adversely affected employment; and 

18 (B) his or her wages reduced to 80 percent 

19 or less of his average weekly wage in such ad20 versely affected employment. 

21 (12) The term ‘‘public agency’’ means a depart22 ment or agency of a State or political subdivision of 

23 a State or of the Federal Government. 

24 (13) The term ‘‘Secretary’’ means the Secretary 

25 of Labor. 


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1 (14) The term ‘‘service workers’’ means work2 ers supplying support or auxiliary services to an em3 ployment site. 

4 (15) The term ‘‘State’’ includes the District of 

5 Columbia and the Commonwealth of Puerto Rico: 

6 and the term ‘‘United States’’ when used in the geo7 graphical sense includes such Commonwealth. 

8 (16) The term ‘‘State agency’’ means the agen9 cy of the State which administers the State law. 

10 (17) The term ‘‘State law’’ means the unem11 ployment insurance law of the State approved by the 

12 Secretary of Labor under section 3304 of the Inter13 nal Revenue Code of 1986. 

14 (18) The terms ‘‘total separation’’ and ‘‘totally 

15 separated’’ refer to the layoff or severance of an in16 dividual from employment with an employer in which 

17 adversely affected employment exists. 

18 (19) The term ‘‘unemployment insurance’’ 

19 means the unemployment compensation payable to 

20 an individual under any State law or Federal unem21 ployment compensation law, including chapter 85 of 

22 title 5, United States Code, and the Railroad Unem23 ployment Insurance Act (45 U.S.C. 351 et seq.). 

24 The terms ‘‘regular compensation’’, ‘‘additional com25 pensation’’, and ‘‘extended compensation’’ have the 


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1 same respective meanings that are given them in 

2 section 205(2), (3), and (4) of the Federal-State Ex3 tended Unemployment Compensation Act of 1970 

4 (26 U.S.C. 3304 note; Public Law 91–373). 

5 (20) The term ‘‘week’’ means a week as defined 

6 in the applicable State law. 

7 (21) The term ‘‘week of unemployment’’ means 

8 a week of total, part-total, or partial unemployment 

9 as determined under the applicable State law or 

10 Federal unemployment insurance law. 

11 (g) SPECIAL RULE WITH RESPECT TO MILITARY

12 SERVICE.— 

13 (1) IN GENERAL.—Notwithstanding any other 

14 provision of this part, the Secretary may waive any 

15 requirement of this part that the Secretary deter16 mines is necessary to ensure that an adversely af17 fected worker who is a member of a reserve compo18 nent of the Armed Forces and serves a period of 

19 duty described in paragraph (2) is eligible to receive 

20 climate change adjustment assistance, training, and 

21 other benefits under this part in the same manner 

22 and to the same extent as if the worker had not 

23 served the period of duty. 

24 (2) PERIOD OF DUTY DESCRIBED.—An ad25 versely affected worker serves a period of duty deVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00279 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 scribed in this paragraph if, before completing train2 ing under this part, the worker— 

3 (A) serves on active duty for a period of 

4 more than 30 days under a call or order to ac5 tive duty of more than 30 days; or 

6 (B) in the case of a member of the Army 

7 National Guard of the United States or Air Na8 tional Guard of the United States, performs 

9 full-time National Guard duty under section 

10 502(f) of title 32, United States Code, for 30 

11 consecutive days or more when authorized by 

12 the President or the Secretary of Defense for 

13 the purpose of responding to a national emer14 gency declared by the President and supported 

15 by Federal funds. 

16 (h) FRAUD AND RECOVERY OF OVERPAYMENTS.— 

17 (1) RECOVERY OF PAYMENTS TO WHICH AN IN18 DIVIDUAL WAS NOT ENTITLED.—If the Secretary or 

19 a court of competent jurisdiction determines that 

20 any person has received any payment under this 

21 part to which the individual was not entitled, such 

22 individual shall be liable to repay such amount to 

23 the Secretary, as the case may be, except that the 

24 Secretary shall waive such repayment if such agency 

25 or the Secretary determines that— 


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1 (A) the payment was made without fault 

2 on the part of such individual; and 

3 (B) requiring such repayment would cause 

4 a financial hardship for the individual (or the 

5 individual’s household, if applicable) when tak6 ing into consideration the income and resources 

7 reasonably available to the individual (or house8 hold) and other ordinary living expenses of the 

9 individual (or household). 

10 (2) MEANS OF RECOVERY.—Unless an overpay11 ment is otherwise recovered, or waived under para12 graph (1), the Secretary shall recover the overpay13 ment by deductions from any sums payable to such 

14 person under this part, under any Federal unem15 ployment compensation law or other Federal law ad16 ministered by the Secretary which provides for the 

17 payment of assistance with respect to unemploy18 ment. Any amount recovered under this section shall 

19 be returned to the Treasury of the United States. 

20 (3) PENALTIES FOR FRAUD.—Any person 

21 who— 

22 (A) makes a false statement of a material 

23 fact knowing it to be false, or knowingly fails 

24 to disclose a material fact, for the purpose of 

25 obtaining or increasing for that person or for 


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1 any other person any payment authorized to be 

2 furnished under this part; or 

3 (B) makes a false statement of a material 

4 fact knowing it to be false, or knowingly fails 

5 to disclose a material fact, when providing in6 formation to the Secretary during an investiga7 tion of a petition under section 311(c); 

8 shall be imprisoned for not more than one year, or fined 

9 under title 18, United States Code, or both, and be ineli10 gible for any further payments under this part. 

11 (i) REGULATIONS.—The Secretary shall prescribe 

12 such regulations as may be necessary to carry out the pro13 visions of this part. 

14 (j) STUDY ON OLDER WORKERS.—The Secretary 

15 shall conduct a study examine the circumstances of older 

16 adversely affected workers and the ability of such workers 

17 to access their retirement benefits. The Secretary shall 

18 transmit a report to Congress not later than 2 years after 

19 the date of enactment of this Act on the findings of the 

20 study and the Secretary’s recommendations on how to en21 sure that adversely affected workers within 2 years of re22 tirement are able to access their retirement benefits. 


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1 Subtitle B—International Climate 

2 Change Programs 

3 SEC. 321. STRATEGIC INTERAGENCY BOARD ON INTER4 NATIONAL CLIMATE INVESTMENT. 

5 (a) ESTABLISHMENT.— 

6 (1) IN GENERAL.—Not later than 90 days after 

7 the date of the enactment of this Act, the President 

8 shall establish the ‘‘Strategic Interagency Board on 

9 International Climate Investment’’ (referred to in 

10 this subtitle as the ‘‘Board’’). 

11 (2) COMPOSITION.—The Board shall be com12 posed of— 

13 (A) the Secretary of State; 

14 (B) the Administrator of United States 

15 Agency for International Development; 

16 (C) the Secretary of Energy; 

17 (D) the Secretary of the Treasury; 

18 (E) the Secretary of Commerce; 

19 (F) the Secretary of Agriculture; 

20 (G) the Administrator; and 

21 (H) such other relevant officials as the 

22 President may designate. 

23 (b) DUTIES.—The duties of the Board shall include 

24 assessing, monitoring, and evaluating the progress and 

25 contributions of relevant departments and agencies of the 


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1 Federal Government in supporting financing for inter2 national climate change activities. 

3 SEC. 322. EMISSION REDUCTIONS FROM REDUCED DEFOR4 ESTATION. 

5 Title VII of the Clean Air Act (as amended by section 

6 101 of division B) is amended by adding at the end the 

7 following: 

8 ‘‘PART E—SUPPLEMENTAL EMISSION 

9 REDUCTIONS 

10 ‘‘SEC. 751. DEFINITIONS. 

11 ‘‘In this part: 

12 ‘‘(1) ADMINISTRATOR.—The term ‘Adminis13 trator’ means the Administrator of the United 

14 States Agency for International Development. 

15 ‘‘(2) DEFORESTATION.—The term ‘deforest16 ation’ means a change in land use from a forest to 

17 any other land use. 

18 ‘‘(3) DEGRADATION.—The term ‘degradation’, 

19 with respect to a forest, is any reduction in the car20 bon stock of a forest due to the impact of human 

21 land-use activities. 

22 ‘‘(4) EMISSION REDUCTIONS.—The term ‘emis23 sion reductions’ means greenhouse gas emission re24 ductions achieved from reduced or avoided deforest25 ation under this title. 


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1 ‘‘(5) LEAKAGE PREVENTION ACTIVITIES.—The 

2 term ‘leakage prevention activities’ means activities 

3 in developing countries that are directed at pre4 serving existing forest carbon stocks, including for5 ested wetlands and peatlands, that might, absent 

6 such activities, be lost through leakage. 

7 ‘‘SEC. 752. PURPOSES. 

8 ‘‘The purposes of this part are to provide United 

9 States assistance to developing countries— 

10 ‘‘(1) to develop, implement and improve nation11 ally appropriate greenhouse gas mitigation policies 

12 and actions that reduce deforestation and forest deg13 radation or conserve or restore forest ecosystems, in 

14 a measurable, reportable, and verifiable manner; and 

15 ‘‘(2) in a manner that is consistent with and 

16 enhances the implementation of complementary 

17 United States policies that support the good govern18 ance of forests, biodiversity conservation, and envi19 ronmentally sustainable development, while taking 

20 local communities, most vulnerable populations and 

21 communities, particularly forest-dependent commu22 nities and indigenous peoples into consideration. 


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1 ‘‘SEC. 753. EMISSION REDUCTIONS FROM REDUCED DEFOR2 ESTATION. 

3 ‘‘(a) IN GENERAL.—Not later than 2 years after the 

4 date of the enactment of this part, the Administrator, in 

5 consultation with the Administrator of the Environmental 

6 Protection Agency, the Secretary of Agriculture, and the 

7 head of any other appropriate agency, shall establish a 

8 program to provide assistance to reduce greenhouse gas 

9 emissions from deforestation in developing countries, in 

10 accordance with this title. 

11 ‘‘(b) OBJECTIVES.—The objectives of the program es12 tablished under this section shall be— 

13 ‘‘(1) to reduce greenhouse gas emissions from 

14 deforestation in developing countries by at least 

15 720,000,000 tons of carbon dioxide equivalent in 

16 2020, and a cumulative quantity of at least 

17 6,000,000,000 tons of carbon dioxide equivalent by 

18 December 31, 2025, with additional reductions in 

19 subsequent years; 

20 ‘‘(2) to assist developing countries in preparing 

21 to participate in international markets for inter22 national offset credits for reduced emissions from 

23 deforestation; and 

24 ‘‘(3) to preserve existing forest carbon stocks in 

25 countries where such forest carbon may be vulner26 able to international leakage.’’. 


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1 SEC. 323. INTERNATIONAL CLEAN ENERGY DEPLOYMENT 

2 PROGRAM. 

3 (a) PURPOSES.—The purposes of this section are— 

4 (1) to assist developing countries in activities 

5 that reduce, sequester, or avoid greenhouse gas 

6 emissions; 

7 (2) to encourage those countries to shift toward 

8 low-carbon development, and promote a successful 

9 global agreement under the United Nations Frame10 work Convention on Climate Change, done at New 

11 York on May 9, 1992 (or a successor agreement) 

12 (referred to in this subtitle as the ‘‘Convention’’); 

13 and 

14 (3) to promote robust compliance with and en15 forcement of existing international legal require16 ments for the protection of intellectual property 

17 rights. 

18 (b) ESTABLISHMENT OF INTERNATIONAL CLEAN EN19 ERGY DEPLOYMENT PROGRAM.— 

20 (1) ESTABLISHMENT.—The Secretary of State, 

21 in consultation with an interagency group designated 

22 by the President, shall establish an International 

23 Clean Energy Deployment Program in accordance 

24 with this section. 

25 (2) DISTRIBUTION OF ASSISTANCE.—The Sec26 retary of State, or the head of such other Federal 


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1 agency as the President may designate, shall direct 

2 the distribution of funding to carry out the Clean 

3 Energy Technology Program— 

4 (A) in the form of bilateral assistance; 

5 (B) to multilateral funds or international 

6 institutions pursuant to the Convention or an 

7 agreement negotiated under the Convention; or 

8 (C) through a combination of the mecha9 nisms identified under subparagraphs (A) and 

10 (B). 

11 (c) DETERMINATION OF QUALIFYING ACTIVITIES.— 

12 Assistance under this subtitle may be provided only to 

13 qualifying entities for clean technology activities (includ14 ing building relevant technical and institutional capacity) 

15 that contribute to substantial, measurable, reportable, and 

16 verifiable reductions, sequestration, or avoidance of green17 house gas emissions. 

18 SEC. 324. INTERNATIONAL CLIMATE CHANGE ADAPTATION 

19 AND GLOBAL SECURITY PROGRAM. 

20 (a) PURPOSES.—The purposes of this section are— 

21 (1) to provide assistance to the most vulnerable 

22 developing countries, particularly to the most vulner23 able communities and populations in those countries; 

24 and 


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1 (2) to support the development and implemen2 tation of climate change adaptation programs in a 

3 way that protects and promotes interests of the 

4 United States, to the extent those interests may be 

5 advanced by minimizing, averting, or increasing re6 silience to climate change impacts. 

7 (b) INTERNATIONAL CLIMATE CHANGE ADAPTATION

8 AND GLOBAL SECURITY PROGRAM.— 

9 (1) ESTABLISHMENT.—The Secretary of State, 

10 in consultation with the Administrator of the United 

11 States Agency for International Development, the 

12 Secretary of the Treasury, and the Administrator, 

13 shall establish an International Climate Change Ad14 aptation and Global Security Program in accordance 

15 with this section. 

16 (2) DISTRIBUTION OF ASSISTANCE.—The Sec17 retary of State, or the head of such other Federal 

18 agency as the President may designate, after con19 sultation with the Secretary of the Treasury, the Ad20 ministrator of the United States Agency for Inter21 national Development, and the Administrator, shall 

22 direct the distribution of funding to carry out the 

23 International Climate Change Adaptation and Global 

24 Security Program— 

25 (A) in the form of bilateral assistance; 


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1 (B) to multilateral funds or international 

2 institutions pursuant to the Convention or an 

3 agreement negotiated under the Convention; or 

4 (C) through a combination of the mecha5 nisms identified under subparagraphs (A) and 

6 (B). 

7 SEC. 325. EVALUATION AND REPORTS. 

8 (a) MONITORING, EVALUATION, AND ENFORCE9 MENT.—The Board shall establish and implement a sys10 tem to monitor and evaluate the effectiveness and effi11 ciency of assistance provided under this subtitle by includ12 ing evaluation criteria, such as performance indicators. 

13 (b) REPORTS AND REVIEW.— 

14 (1) ANNUAL REPORT.—Not later than 1 year 

15 after the date of enactment of this Act, and annually 

16 thereafter, the Board shall submit to the appropriate 

17 committees of Congress a report that describes— 

18 (A) the steps Federal agencies have taken, 

19 and the progress made, toward accomplishing 

20 the objectives of this section; and 

21 (B) the ramifications of any potentially de22 stabilizing impacts climate change may have on 

23 the interests of the United States. 

24 (2) REVIEWS.—Not later than 3 years after the 

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1 after, the Board, in cooperation with the National 

2 Academy of Sciences and other appropriate research 

3 and development institutions, shall— 

4 (A) review the global needs and opportuni5 ties for climate change investment in developing 

6 countries; and 

7 (B) submit to Congress a report that de8 scribes the findings of the review. 

9 SEC. 326. REPORT ON CLIMATE ACTIONS OF MAJOR 

10 ECONOMIES. 

11 (a) IN GENERAL.—The Secretary of State, in co12 operation with the Board, shall prepare an interagency re13 port on climate change and energy policy of the 5 coun14 tries that, of the countries that are not members of the 

15 Organisation for Economic Co-Operation and Develop16 ment, emit the greatest annual quantity of greenhouse 

17 gases. 

18 (b) PURPOSES.—The purposes of the report shall 

19 be— 

20 (1) to provide to Congress and the public of the 

21 United States— 

22 (A) a better understanding of the actions 

23 the countries described in subsection (a) are 

24 taking to reduce greenhouse gas emissions; and 


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1 (B) an assessment of the climate change 

2 and energy policy commitments and actions of 

3 those countries; and 

4 (2) to identify the means by which the United 

5 States can assist those countries in achieving such 

6 a reduction. 

7 (c) SUBMISSION TO CONGRESS.—Not later than 15 

8 months after the date of enactment of this Act, the Sec9 retary of State shall submit to the appropriate committees 

10 of Congress the report prepared under this section. 

11 Subtitle C—Adapting to Climate 

12 Change 

13 PART 1—DOMESTIC ADAPTATION 

14 Subpart A—National Climate Change Adaptation 

15 Program 

16 SEC. 341. NATIONAL CLIMATE CHANGE ADAPTATION PRO17 GRAM. 

18 The President shall establish within the United 

19 States Global Change Research Program a National Cli20 mate Change Adaptation Program for the purpose of in21 creasing the overall effectiveness of Federal climate 

22 change adaptation efforts. 

23 SEC. 342. CLIMATE SERVICES. 

24 The Secretary of Commerce, acting through the Ad25 ministrator of the National Oceanic and Atmospheric AdVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00292 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 ministration (NOAA), shall establish within NOAA a Na2 tional Climate Service to develop climate information, 

3 data, forecasts, and warnings at national and regional 

4 scales, and to distribute information related to climate im5 pacts to State, local, and tribal governments and the pub6 lic to facilitate the development and implementation of 

7 strategies to reduce society’s vulnerability to climate varia8 bility and change. 

9 Subpart B—Public Health and Climate Change 

10 SEC. 351. SENSE OF CONGRESS ON PUBLIC HEALTH AND 

11 CLIMATE CHANGE. 

12 It is the sense of the Congress that the Federal Gov13 ernment, in cooperation with international, State, tribal, 

14 and local governments, Indian tribes, concerned public and 

15 private organizations, and citizens, should use all prac16 ticable means and measures— 

17 (1) to assist the efforts of public health and 

18 health care professionals, first responders, States, 

19 Indian tribes, municipalities, and local communities 

20 to incorporate measures to prepare health systems to 

21 respond to the impacts of climate change; 

22 (2) to ensure— 

23 (A) that the Nation’s health professionals 

24 have sufficient information to prepare for and 


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1 respond to the adverse health impacts of cli2 mate change; 

3 (B) the utility and value of scientific re4 search in advancing understanding of— 

5 (i) the health impacts of climate 

6 change; and 

7 (ii) strategies to prepare for and re8 spond to the health impacts of climate 

9 change; 

10 (C) the identification of communities vul11 nerable to the health effects of climate change 

12 and the development of strategic response plans 

13 to be carried out by health professionals for 

14 those communities; 

15 (D) the improvement of health status and 

16 health equity through efforts to prepare for and 

17 respond to climate change; and 

18 (E) the inclusion of health policy in the de19 velopment of climate change responses; 

20 (3) to encourage further research, interdiscipli21 nary partnership, and collaboration among stake22 holders in order to— 

23 (A) understand and monitor the health im24 pacts of climate change; and 


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1 (B) improve public health knowledge and 

2 response strategies to climate change; 

3 (4) to enhance preparedness activities, and pub4 lic health infrastructure, relating to climate change 

5 and health; 

6 (5) to encourage each and every American to 

7 learn about the impacts of climate change on health; 

8 and 

9 (6) to assist the efforts of developing nations to 

10 incorporate measures to prepare health systems to 

11 respond to the impacts of climate change. 

12 SEC. 352. RELATIONSHIP TO OTHER LAWS. 

13 Nothing in this subpart in any manner limits the au14 thority provided to or responsibility conferred on any Fed15 eral department or agency by any provision of any law 

16 (including regulations) or authorizes any violation of any 

17 provision of any law (including regulations), including any 

18 health, energy, environmental, transportation, or any 

19 other law or regulation. 

20 SEC. 353. NATIONAL STRATEGIC ACTION PLAN. 

21 (a) REQUIREMENT.— 

22 (1) IN GENERAL.—The Secretary of Health and 

23 Human Services, within 2 years after the date of the 

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1 graph (2), shall publish a strategic action plan to as2 sist health professionals in preparing for and re3 sponding to the impacts of climate change on public 

4 health in the United States and other nations, par5 ticularly developing nations. 

6 (2) CONSULTATION.—In developing or making 

7 any revision to the national strategic action plan, the 

8 Secretary shall— 

9 (A) consult with the Director of the Cen10 ters for Disease Control and Prevention, the 

11 Administrator of the Environmental Protection 

12 Agency, the Director of the National Institutes 

13 of Health, the Director of the Indian Health 

14 Service, the Secretary of Energy, other appro15 priate Federal agencies, Indian tribes, State 

16 and local governments, public health organiza17 tions, scientists, and other interested stake18 holders; and 

19 (B) provide opportunity for public input. 

20 (b) CONTENTS.— 

21 (1) IN GENERAL.—The Secretary shall assist 

22 health professionals in preparing for and responding 

23 effectively and efficiently to the health effects of cli24 mate change through measures including— 


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1 (A) developing, improving, integrating, and 

2 maintaining domestic and international disease 

3 surveillance systems and monitoring capacity to 

4 respond to health-related effects of climate 

5 change, including on topics addressing— 

6 (i) water, food, and vector borne infec7 tious diseases and climate change; 

8 (ii) pulmonary effects, including re9 sponses to aeroallergens; 

10 (iii) cardiovascular effects, including 

11 impacts of temperature extremes; 

12 (iv) air pollution health effects, includ13 ing heightened sensitivity to air pollution; 

14 (v) hazardous algal blooms; 

15 (vi) mental and behavioral health im16 pacts of climate change; 

17 (vii) the health of refugees, displaced 

18 persons, and vulnerable communities; 

19 (viii) the implications for communities 

20 vulnerable to health effects of climate 

21 change, as well as strategies for responding 

22 to climate change within these commu23 nities; and 


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1 (ix) local and community-based health 

2 interventions for climate-related health im3 pacts; 

4 (B) creating tools for predicting and moni5 toring the public health effects of climate 

6 change on the international, national, regional, 

7 State, tribal, and local levels, and providing 

8 technical support to assist in their implementa9 tion; 

10 (C) developing public health communica11 tions strategies and interventions for extreme 

12 weather events and disaster response situations; 

13 (D) identifying and prioritizing commu14 nities and populations vulnerable to the health 

15 effects of climate change, and determining ac16 tions and communication strategies that should 

17 be taken to inform and protect these commu18 nities and populations from the health effects of 

19 climate change; 

20 (E) developing health communication, pub21 lic education, and outreach programs aimed at 

22 public health and health care professionals, as 

23 well as the general public, to promote prepared24 ness and response strategies relating to climate 

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1 fication of greenhouse gas reduction behaviors 

2 that are health-promoting; and 

3 (F) developing academic and regional cen4 ters of excellence devoted to— 

5 (i) researching relationships between 

6 climate change and health; 

7 (ii) expanding and training the public 

8 health workforce to strengthen the capacity 

9 of such workforce to respond to and pre10 pare for the health effects of climate 

11 change; 

12 (iii) creating and supporting academic 

13 fellowships focusing on the health effects 

14 of climate change; and 

15 (iv) training senior health ministry of16 ficials from developing nations to strength17 en the capacity of such nations to— 

18 (I) prepare for and respond to 

19 the health effects of climate change; 

20 and 

21 (II) build an international net22 work of public health professionals 

23 with the necessary climate change 

24 knowledge base; 


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1 (G) using techniques, including health im2 pact assessments, to assess various climate 

3 change public health preparedness and response 

4 strategies on international, national, State, re5 gional, tribal, and local levels, and make rec6 ommendations as to those strategies that best 

7 protect the public health; 

8 (H)(i) assisting in the development, imple9 mentation, and support of State, regional, trib10 al, and local preparedness, communication, and 

11 response plans (including with respect to the 

12 health departments of such entities) to antici13 pate and reduce the health threats of climate 

14 change; and 

15 (ii) pursuing collaborative efforts to de16 velop, integrate, and implement such plans; 

17 (I) creating a program to advance research 

18 as it relates to the effects of climate change on 

19 public health across Federal agencies, including 

20 research to— 

21 (i) identify and assess climate change 

22 health effects preparedness and response 

23 strategies; 

24 (ii) prioritize critical public health in25 frastructure projects related to potential 


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1 climate change impacts that affect public 

2 health; and 

3 (iii) coordinate preparedness for cli4 mate change health impacts, including the 

5 development of modeling and forecasting 

6 tools; 

7 (J) providing technical assistance for the 

8 development, implementation, and support of 

9 preparedness and response plans to anticipate 

10 and reduce the health threats of climate change 

11 in developing nations; and 

12 (K) carrying out other activities deter13 mined appropriate by the Secretary to plan for 

14 and respond to the impacts of climate change 

15 on public health. 

16 (c) REVISION.—The Secretary shall revise the na17 tional strategic action plan not later than July 1, 2014, 

18 and every 4 years thereafter, to reflect new information 

19 collected pursuant to implementation of the national stra20 tegic action plan and otherwise, including information 

21 on— 

22 (1) the status of critical environmental health 

23 parameters and related human health impacts; 

24 (2) the impacts of climate change on public 

25 health; and 


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1 (3) advances in the development of strategies 

2 for preparing for and responding to the impacts of 

3 climate change on public health. 

4 (d) IMPLEMENTATION.— 

5 (1) IMPLEMENTATION THROUGH HHS.—The 

6 Secretary shall exercise the Secretary’s authority 

7 under this subpart and other provisions of Federal 

8 law to achieve the goals and measures of the na9 tional strategic action plan. 

10 (2) OTHER PUBLIC HEALTH PROGRAMS AND

11 INITIATIVES.—The Secretary and Federal officials of 

12 other relevant Federal agencies shall administer 

13 public health programs and initiatives authorized by 

14 provisions of law other than this subpart, subject to 

15 the requirements of such statutes, in a manner de16 signed to achieve the goals of the national strategic 

17 action plan. 

18 (3) SPECIFIC ACTIVITIES.—In furtherance of 

19 the national strategic action plan, the Secretary 

20 shall— 

21 (A) conduct scientific research to assist 

22 health professionals in preparing for and re23 sponding to the impacts of climate change on 

24 public health; and 

25 (B) provide funding for— 


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1 (i) research on the health effects of 

2 climate change; and 

3 (ii) preparedness planning on the 

4 international, national, State, tribal, re5 gional, and local levels to respond to or re6 duce the burden of health effects of climate 

7 change; and 

8 (C) carry out other activities determined 

9 appropriate by the Secretary to prepare for and 

10 respond to the impacts of climate change on 

11 public health. 

12 SEC. 354. ADVISORY BOARD. 

13 (a) ESTABLISHMENT.—The Secretary shall establish 

14 a permanent science advisory board comprised of not less 

15 than 10 and not more than 20 members. 

16 (b) APPOINTMENT OF MEMBERS.—The Secretary 

17 shall appoint the members of the science advisory board 

18 from among individuals— 

19 (1) who have expertise in public health and 

20 human services, climate change, and other relevant 

21 disciplines; and 

(2) at least 1 22 ⁄2 of whom are recommended by 

23 the President of the National Academy of Sciences. 

24 (c) FUNCTIONS.—The science advisory board shall— 


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1 (1) provide scientific and technical advice and 

2 recommendations to the Secretary on the domestic 

3 and international impacts of climate change on pub4 lic health, populations and regions particularly vul5 nerable to the effects of climate change, and strate6 gies and mechanisms to prepare for and respond to 

7 the impacts of climate change on public health; and 

8 (2) advise the Secretary regarding the best 

9 science available for purposes of issuing the national 

10 strategic action plan. 

11 SEC. 355. REPORTS. 

12 (a) NEEDS ASSESSMENT.— 

13 (1) IN GENERAL.—The Secretary shall seek to 

14 enter into, by not later than 6 months after the date 

15 of the enactment of this Act, an agreement with the 

16 National Research Council and the Institute of Med17 icine to complete a report that— 

18 (A) assesses the needs for health profes19 sionals to prepare for and respond to climate 

20 change impacts on public health; and 

21 (B) recommends programs to meet those 

22 needs. 

23 (2) SUBMISSION.—The agreement under para24 graph (1) shall require the completed report to be 

25 submitted to the Congress and the Secretary and 


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1 made publicly available not later than 1 year after 

2 the date of the agreement. 

3 (b) CLIMATE CHANGE HEALTH PROTECTION AND

4 PROMOTION REPORTS.— 

5 (1) IN GENERAL.—The Secretary, in consulta6 tion with the advisory board established under sec7 tion 354, shall ensure the issuance of reports to aid 

8 health professionals in preparing for and responding 

9 to the adverse health effects of climate change 

10 that— 

11 (A) review scientific developments on 

12 health impacts of climate change; and 

13 (B) recommend changes to the national 

14 strategic action plan. 

15 (2) SUBMISSION.—The Secretary shall submit 

16 the reports required by paragraph (1) to the Con17 gress and make such reports publicly available not 

18 later than July 1, 2013, and every 4 years there19 after. 

20 SEC. 356. DEFINITIONS. 

21 In this subpart: 

22 (1) HEALTH IMPACT ASSESSMENT.—The term 

23 ‘‘health impact assessment’’ means a combination of 

24 procedures, methods, and tools by which a policy, 

25 program, or project may be judged as to its potential 


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1 effects on the health of a population, and the dis2 tribution of those effects within the population. 

3 (2) NATIONAL STRATEGIC ACTION PLAN.—The 

4 term ‘‘national strategic action plan’’ means the 

5 plan issued and revised under section 353. 

6 (3) SECRETARY.—Unless otherwise specified, 

7 the term ‘‘Secretary’’ means the Secretary of Health 

8 and Human Services. 

9 Subpart C—Climate Change Safeguards for Natural 

10 Resources Conservation 

11 SEC. 361. PURPOSES. 

12 The purposes of this subpart are— 

13 (1) to establish an integrated Federal program 

14 that responds to ongoing and expected impacts of 

15 climate change, including, where applicable, ocean 

16 acidification, drought, flooding, and wildfire, by pro17 tecting, restoring, and conserving the natural re18 sources of the United States; and 

19 (2) to provide financial support and incentives 

20 for programs, strategies, and activities that respond 

21 to threats of climate change, including, where appli22 cable, ocean acidification, drought, flooding, and 

23 wildfire, by protecting, restoring, and conserving the 

24 natural resources of the United States. 


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1 SEC. 362. NATURAL RESOURCES CLIMATE CHANGE ADAP2 TATION POLICY. 

3 It is the policy of the Federal Government, in co4 operation with State and local governments, Indian tribes, 

5 and other interested stakeholders, to use all practicable 

6 means to protect, restore, and conserve natural resources 

7 so that natural resources become more resilient, adapt to, 

8 and withstand the ongoing and expected impacts of cli9 mate change, including, where applicable, ocean acidifica10 tion, drought, flooding, and wildfire. 

11 SEC. 363. DEFINITIONS. 

12 In this subpart: 

13 (1) ACCOUNT.—The term ‘‘Account’’ means the 

14 Natural Resources Climate Change Adaption Ac15 count established by section 370(a). 

16 (2) ADMINISTRATORS.—The term ‘‘Administra17 tors’’ means— 

18 (A) the Administrator of the National Oce19 anic and Atmospheric Administration; and 

20 (B) the Director of the United States Geo21 logical Survey. 

22 (3) BOARD.—The term ‘‘Board’’ means the 

23 Science Advisory Board established by section 

24 367(f)(1). 


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1 (4) CENTER.—The term ‘‘Center’’ means the 

2 National Climate Change and Wildlife Science Cen3 ter described by section 367(e)(1). 

4 (5) COASTAL STATE.—The term ‘‘coastal 

5 State’’ has the meaning given the term ‘‘coastal 

6 state’’ in section 304 of the Coastal Zone Manage7 ment Act of 1972 (16 U.S.C. 1453). 

8 (6) CORRIDORS.—The term ‘‘corridors’’ means 

9 areas that— 

10 (A) provide connectivity, over different 

11 time scales, of habitats or potential habitats; 

12 and 

13 (B) facilitate terrestrial, marine, estuarine, 

14 and freshwater fish, wildlife, or plant movement 

15 necessary for migration, gene flow, or dispersal, 

16 or to respond to the ongoing and expected im17 pacts of climate change, including, where appli18 cable, ocean acidification, drought, flooding, 

19 and wildfire. 

20 (7) ECOLOGICAL PROCESSES.—The term ‘‘eco21 logical processes’’ means biological, chemical, or 

22 physical interaction between the biotic and abiotic 

23 components of an ecosystem, including— 

24 (A) nutrient cycling; 

25 (B) pollination; 


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1 (C) predator-prey relationships; 

2 (D) soil formation; 

3 (E) gene flow; 

4 (F) disease epizootiology; 

5 (G) larval dispersal and settlement; 

6 (H) hydrological cycling; 

7 (I) decomposition; and 

8 (J) disturbance regimes, such as fire and 

9 flooding. 

10 (8) HABITAT.—The term ‘‘habitat’’ means the 

11 physical, chemical, and biological properties that 

12 fish, wildlife, or plants use for growth, reproduction, 

13 survival, food, water, or cover (whether on land, in 

14 water, or in an area or region). 

15 (9) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 

16 has the meaning given the term in section 4 of the 

17 Indian Self-Determination and Education Assistance 

18 Act (25 U.S.C. 450b). 

19 (10) NATURAL RESOURCES.—The term ‘‘nat20 ural resources’’ means land, wildlife, fish, air, water, 

21 estuaries, plants, habitats, and ecosystems of the 

22 United States. 

23 (11) NATURAL RESOURCES ADAPTATION.—The 

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1 sources so that natural resources become more resil2 ient, adapt to, and withstand the ongoing and ex3 pected impacts of climate change, including, where 

4 applicable, ocean acidification, drought, flooding, 

5 and wildfire. 

6 (12) PANEL.—The term ‘‘Panel’’ means the 

7 Natural Resources Climate Change Adaptation 

8 Panel established under section 365(a). 

9 (13) RESILIENCE; RESILIENT.—The terms ‘‘re10 silience’’ and ‘‘resilient’’ mean— 

11 (A) the ability to resist or recover from 

12 disturbance; and 

13 (B) the ability to preserve diversity, pro14 ductivity, and sustainability. 

15 (14) STATE.—The term ‘‘State’’ means— 

16 (A) a State of the United States; 

17 (B) the District of Columbia; 

18 (C) American Samoa; 

19 (D) Guam; 

20 (E) the Commonwealth of the Northern 

21 Mariana Islands; 

22 (F) the Commonwealth of Puerto Rico; 

23 and 

24 (G) the United States Virgin Islands. 


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1 (15) STRATEGY.—The term ‘‘Strategy’’ means 

2 the Natural Resources Climate Change Adaptation 

3 Strategy developed under section 366(a). 

4 SEC. 364. COUNCIL ON ENVIRONMENTAL QUALITY. 

5 The Chair of the Council on Environmental Quality 

6 shall— 

7 (1) advise the President on implementing and 

8 developing— 

9 (A) the Strategy; and 

10 (B) the Federal natural resource agency 

11 adaptation plans required by section 368; 

12 (2) serve as the Chair of the Panel established 

13 under section 365; and 

14 (3) coordinate Federal agency strategies, plans, 

15 programs, and activities relating to protecting, re16 storing, and maintaining natural resources so that 

17 natural resources become more resilient, adapt to, 

18 and withstand the ongoing and expected impacts of 

19 climate change. 

20 SEC. 365. NATURAL RESOURCES CLIMATE CHANGE ADAP21 TATION PANEL. 

22 (a) ESTABLISHMENT.—Not later than 90 days after 

23 the date of enactment of this Act, the President shall es24 tablish a Natural Resources Climate Change Adaptation 

25 Panel. 


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1 (b) DUTIES.—The Panel shall serve as a forum for 

2 interagency consultation on, and the coordination of, the 

3 development and implementation of the Strategy. 

4 (c) MEMBERSHIP.—The Panel shall be composed 

5 of— 

6 (1) the Administrator of the National Oceanic 

7 and Atmospheric Administration (or a designee); 

8 (2) the Chief of the Forest Service (or a des9 ignee); 

10 (3) the Director of the National Park Service 

11 (or a designee); 

12 (4) the Director of the United States Fish and 

13 Wildlife Service (or a designee); 

14 (5) the Director of the Bureau of Land Man15 agement (or a designee); 

16 (6) the Director of the United States Geological 

17 Survey (or a designee); 

18 (7) the Commissioner of Reclamation (or a des19 ignee); 

20 (8) the Director of the Bureau of Indian Affairs 

21 (or a designee); 

22 (9) the Administrator of the Environmental 

23 Protection Agency (or a designee); 

24 (10) the Chief of Engineers (or a designee); 


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1 (11) the Chair of the Council on Environmental 

2 Quality (or a designee); 

3 (12) the Administrator of the Federal Emer4 gency Management Agency (or a designee); and 

5 (13) the heads of such other Federal agencies 

6 or departments with jurisdiction over natural re7 sources of the United States, as determined by the 

8 President. 

9 (d) CHAIRPERSON.—The Chair of the Council on En10 vironmental Quality shall serve as the Chairperson of the 

11 Panel. 

12 SEC. 366. NATURAL RESOURCES CLIMATE CHANGE ADAP13 TATION STRATEGY. 

14 (a) IN GENERAL.—Not later than 1 year after the 

15 date of enactment of this Act, the Panel shall develop a 

16 Natural Resources Climate Change Adaptation Strategy— 

17 (1) to protect, restore, and conserve natural re18 sources so that natural resources become more resil19 ient, adapt to, and withstand the ongoing and ex20 pected impacts of climate change; and 

21 (2) to identify opportunities to mitigate the on22 going and expected impacts of climate change. 

23 (b) DEVELOPMENT.—In developing and revising the 

24 Strategy, the Panel shall— 


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1 (1) base the strategy on the best available 

2 science; 

3 (2) develop the strategy in close cooperation 

4 with States and Indian tribes; 

5 (3) coordinate with other Federal agencies, as 

6 appropriate; 

7 (4) consult with local governments, conservation 

8 organizations, scientists, and other interested stake9 holders; and 

10 (5) provide public notice and opportunity for 

11 comment. 

12 (c) REVISION.—After the Panel adopts the initial 

13 Strategy, the Panel shall review and revise the Strategy 

14 every 5 years to incorporate— 

15 (1) new information regarding the ongoing and 

16 expected impacts of climate change on natural re17 sources; and 

18 (2) new advances in the development of strate19 gies that make natural resources more resilient or 

20 able to adapt to the ongoing and expected impacts 

21 of climate change. 

22 (d) CONTENTS.—The Strategy shall— 

23 (1) assess the vulnerability of natural resources 

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1 term, long-term, cumulative, and synergistic im2 pacts; 

3 (2) describe current research, observation, and 

4 monitoring activities at the Federal, State, tribal, 

5 and local level related to the ongoing and expected 

6 impacts of climate change on natural resources; 

7 (3) identify and prioritize research and data 

8 needs; 

9 (4) identify natural resources likely to have the 

10 greatest need for protection, restoration, and con11 servation due to the ongoing and expanding impacts 

12 of climate change; 

13 (5) include specific protocols for integrating 

14 natural resources adaptation strategies and activities 

15 into the conservation and management of natural re16 sources by Federal departments and agencies to en17 sure consistency across agency jurisdictions; 

18 (6) include specific actions that Federal depart19 ments and agencies shall take to protect, conserve, 

20 and restore natural resources to become more resil21 ient, adapt to, and withstand the ongoing and ex22 pected impacts of climate change, including a 

23 timeline to implement those actions; 

24 (7) include specific mechanisms for ensuring 

25 communication and coordination— 


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1 (A) among Federal departments and agen2 cies; and 

3 (B) between Federal departments and 

4 agencies and State natural resource agencies, 

5 United States territories, Indian tribes, private 

6 landowners, conservation organizations, and 

7 other countries that share jurisdiction over nat8 ural resources with the United States; 

9 (8) include specific actions to develop and im10 plement consistent natural resources inventory and 

11 monitoring protocols through interagency coordina12 tion and collaboration; and 

13 (9) include procedures for guiding the develop14 ment of detailed agency- and department-specific ad15 aptation plans required under section 368. 

16 (e) IMPLEMENTATION.—Consistent with other laws 

17 and Federal trust responsibilities concerning Indian land, 

18 each Federal department or agency represented on the 

19 Panel shall integrate the elements of the Strategy that re20 late to conservation, restoration, and management of nat21 ural resources into agency plans, environmental reviews, 

22 programs, and activities. 


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1 SEC. 367. NATURAL RESOURCES ADAPTATION SCIENCE 

2 AND INFORMATION. 

3 (a) COORDINATION.—Not later than 90 days after 

4 the date of enactment of this Act, the Administrators shall 

5 establish coordinated procedures for developing and pro6 viding science and information necessary to address the 

7 ongoing and expected impacts of climate change on nat8 ural resources. 

9 (b) OVERSIGHT.—The National Climate Change and 

10 Wildlife Science Center established under subsection (e) 

11 and the National Climate Service of the National Oceanic 

12 and Atmospheric Administration shall oversee develop13 ment of the procedures. 

14 (c) FUNCTIONS.—The Administrators shall— 

15 (1) ensure that the procedures required under 

16 subsection (a) avoid duplication; and 

17 (2) ensure that the National Oceanic and At18 mospheric Administration and the United States Ge19 ological Survey— 

20 (A) provide technical assistance to Federal 

21 departments and agencies, State and local gov22 ernments, Indian tribes, and interested private 

23 landowners that are pursuing the goals of ad24 dressing the ongoing and expected impacts of 

25 climate change on natural resources; 


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1 (B) conduct and sponsor research to de2 velop strategies that increase the ability of nat3 ural resources to become more resilient, adapt 

4 to, and withstand the ongoing and expected im5 pacts of climate change; 

6 (C) provide Federal departments and agen7 cies, State and local governments, Indian tribes, 

8 and interested private landowners with research 

9 products, decision and monitoring tools, and in10 formation to develop strategies that increase 

11 the ability of natural resources to become more 

12 resilient, adapt to, and withstand the ongoing 

13 and expected impacts of climate change; and 

14 (D) assist Federal departments and agen15 cies in the development of adaptation plans re16 quired by section 368. 

17 (d) SURVEY.—Not later than 1 year after the date 

18 of enactment of this Act, and every 5 years thereafter, 

19 the Secretary of Commerce and the Secretary of the Inte20 rior shall conduct a climate change impact survey that— 

21 (1) identifies natural resources considered likely 

22 to be adversely affected by climate change; 

23 (2) includes baseline monitoring and ongoing 

24 trend analysis; 


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1 (3) with input from stakeholders, identifies and 

2 prioritizes necessary monitoring and research that is 

3 most relevant to the needs of natural resource man4 agers to address the ongoing and expected impacts 

5 of climate change and to promote resilience; and 

6 (4) identifies the decision tools necessary to de7 velop strategies that increase the ability of natural 

8 resources to become more resilient, adapt to, and 

9 withstand the ongoing and expected impacts of cli10 mate change. 

11 (e) NATIONAL CLIMATE CHANGE AND WILDLIFE

12 SCIENCE CENTER.— 

13 (1) ESTABLISHMENT.—The Secretary of the In14 terior shall establish the National Climate Change 

15 and Wildlife Science Center within the United States 

16 Geological Survey. 

17 (2) FUNCTIONS.—In collaboration with Federal 

18 and State natural resources agencies and depart19 ments, Indian tribes, universities, and other partner 

20 organizations, the Center shall— 

21 (A) assess and synthesize current physical 

22 and biological knowledge; 

23 (B) prioritize scientific gaps in such knowl24 edge in order to forecast the ecological impacts 

25 of climate change, including, where applicable, 


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1 ocean acidification, drought, flooding, and wild2 fire on fish and wildlife at the ecosystem, habi3 tat, community, population, and species levels; 

4 (C) develop and improve tools to identify, 

5 evaluate, and link scientific approaches and 

6 models that forecast the impacts of climate 

7 change, including, where applicable, ocean acidi8 fication, drought, flooding, and wildfire on fish, 

9 wildlife, plants, and associated habitats, includ10 ing— 

11 (i) monitoring; 

12 (ii) predictive models; 

13 (iii) vulnerability analyses; 

14 (iv) risk assessments; and 

15 (v) decision support systems that help 

16 managers make informed decisions; 

17 (D) develop and evaluate tools to adapt18 ively manage and monitor the effects of climate 

19 change (including tools for the collection of 

20 data) on fish and wildlife on the national, re21 gional, and local level; and 

22 (E) develop capacities for sharing stand23 ardized data and the synthesis of the data de24 scribed in subparagraph (D). 

25 (f) SCIENCE ADVISORY BOARD.— 


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1 (1) ESTABLISHMENT.—Not later than 180 days 

2 after the date of enactment of this Act, the Sec3 retary of Commerce and the Secretary of the Inte4 rior shall establish and appoint the members of the 

5 Science Advisory Board. 

6 (2) MEMBERSHIP.—The Board shall be com7 prised of not fewer than 10 and not more than 20 

8 members— 

9 (A) who have expertise in fish, wildlife, 

10 plant, aquatic, and coastal and marine biology, 

11 ecology, climate change, including, where appli12 cable, ocean acidification, drought, flooding, 

13 and wildfire, and other relevant scientific dis14 ciplines; 

15 (B) who represent a balanced membership 

16 among Federal, State, tribal, and local rep17 resentatives, universities, and conservation or18 ganizations; and 

(C) at least 1 19 ⁄2 of whom are recommended 

20 by the President of the National Academy of 

21 Sciences. 

22 (3) DUTIES.—The Board shall— 

23 (A) advise the Secretary of Commerce and 

24 the Secretary of the Interior on the state of the 

25 science regarding— 


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1 (i) the ongoing and expected impacts 

2 of climate change, including, where appli3 cable, ocean acidification, drought, flood4 ing, and wildfire on natural resources; and 

5 (ii) scientific strategies and mecha6 nisms for protecting, restoring, and con7 serving natural resources so natural re8 sources become more resilient, adapt to, 

9 and withstand the ongoing and expected 

10 impacts of climate change, including, 

11 where applicable, ocean acidification, 

12 drought, flooding, and wildfire; and 

13 (B) identify and recommend priorities for 

14 ongoing research needs on the issues described 

15 in subparagraph (A). 

16 (4) COLLABORATION.—The Board shall collabo17 rate with climate change and ecosystem research en18 tities in other Federal agencies and departments. 

19 (5) AVAILABILITY TO PUBLIC.—The advice and 

20 recommendations of the Board shall be made avail21 able to the public. 


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1 SEC. 368. FEDERAL NATURAL RESOURCE AGENCY ADAPTA2 TION PLANS. 

3 (a) DEVELOPMENT.—Not later than 1 year after the 

4 date of development of the Strategy, each department or 

5 agency with representation on the Panel shall— 

6 (1) complete an adaptation plan for that de7 partment or agency that— 

8 (A) implements the Strategy and is con9 sistent with the natural resources climate 

10 change adaptation policy required by section 

11 362; 

12 (B) details the ongoing and expanding ac13 tions of the department or agency, and any 

14 changes in decisionmaking processes necessary 

15 to increase the ability of resources under the ju16 risdiction of the department or agency and, to 

17 the maximum extent practicable, resources 

18 under the jurisdiction of other departments and 

19 agencies that may be significantly affected by 

20 decisions of the department or agency, to be21 come more resilient, adapt to, and withstand 

22 the ongoing and expected impacts of climate 

23 change, including, where applicable, ocean acidi24 fication, drought, flooding, and wildfire; and 

25 (C) includes a timeline for implementation; 


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1 (2) provide opportunities for public review and 

2 comment on the adaptation plan, and in the case of 

3 a plan by the Bureau of Indian Affairs, review by 

4 Indian tribes; and 

5 (3) submit the plan to the President for ap6 proval. 

7 (b) REVIEW BY PRESIDENT AND SUBMISSION TO

8 CONGRESS.— 

9 (1) REVIEW BY PRESIDENT.—The President 

10 shall— 

11 (A) approve an adaptation plan submitted 

12 under subsection (a)(3) if the plan meets the 

13 requirements of subsection (c) and is consistent 

14 with the Strategy; and 

15 (B) decide whether to approve the plan 

16 within 60 days of submission. 

17 (2) DISAPPROVAL.—If the President dis18 approves an adaptation plan, the President shall di19 rect the department or agency to submit a revised 

20 plan within 60 days of that disapproval. 

21 (3) SUBMISSION TO CONGRESS.—Not later than 

22 30 days after the date of approval of an adaptation 

23 plan by the President, the department or agency 

24 shall submit the plan to— 


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1 (A) the Committee on Natural Resources 

2 of the House of Representatives; 

3 (B) the Committee on Energy and Natural 

4 Resources of the Senate; 

5 (C) the Committee on Environment and 

6 Public Works of the Senate; and 

7 (D) any other committees of the House of 

8 Representatives or the Senate with principal ju9 risdiction over the department or agency. 

10 (c) REQUIREMENTS.—Each adaptation plan shall— 

11 (1) establish programs for assessing the ongo12 ing and expected impacts of climate change, includ13 ing, where applicable, ocean acidification, drought, 

14 flooding, and wildfire on natural resources under the 

15 jurisdiction of the department or agency preparing 

16 the plan, including— 

17 (A) assessment of cumulative and syner18 gistic effects; and 

19 (B) programs that identify and monitor 

20 natural resources likely to be adversely affected 

21 and that have need for conservation; 

22 (2) identify and prioritize— 

23 (A) the strategies of the department or 

24 agency preparing the plan; 


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1 (B) the specific conservation actions that 

2 address the ongoing and expected impacts of 

3 climate change, including, where applicable, 

4 ocean acidification, drought, flooding, and wild5 fire on natural resources under jurisdiction of 

6 the department or agency preparing the plan; 

7 (C) strategies to protect, restore, and con8 serve such resources to become more resilient, 

9 adapt to, and better withstand those impacts, 

10 including— 

11 (i) protection, restoration, and con12 servation of terrestrial, marine, estuarine, 

13 and freshwater habitats and ecosystems; 

14 (ii) establishment of terrestrial, ma15 rine, estuarine, and freshwater habitat 

16 linkages and corridors; 

17 (iii) restoration and conservation of 

18 ecological processes; 

19 (iv) protection of a broad diversity of 

20 native species of fish, wildlife, and plant 

21 populations across the ranges of those spe22 cies; and 

23 (v) protection of fish, wildlife, and 

24 plant health, recognizing that climate can 


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1 alter the distribution and ecology of 

2 parasites, pathogens, and vectors; 

3 (3) describe how the department or agency 

4 will— 

5 (A) integrate the strategies and conserva6 tion activities into plans, programs, activities, 

7 and actions of the department or agency relat8 ing to the conservation and management of nat9 ural resources; and 

10 (B) establish new plans, programs, activi11 ties, and actions, if necessary; 

12 (4) establish methods— 

13 (A) to assess the effectiveness of strategies 

14 and conservation actions the department or 

15 agency takes to protect, restore, and conserve 

16 natural resources so natural resources become 

17 more resilient, adapt to, and withstand the on18 going and expected impacts of climate change; 

19 and 

20 (B) to update those strategies and actions 

21 to respond to new information and changing 

22 conditions; 

23 (5) describe current and proposed mechanisms 

24 to enhance cooperation and coordination of natural 

25 resources adaptation efforts with other Federal 


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1 agencies, State and local governments, Indian tribes, 

2 and nongovernmental stakeholders; 

3 (6) include written guidance to resource man4 agers that— 

5 (A) explains how managers are expected to 

6 address the ongoing and expected effects of cli7 mate change, including, where applicable, ocean 

8 acidification, drought, flooding, and wildfire; 

9 (B) identifies how managers shall obtain 

10 any necessary site-specific information; and 

11 (C) reflects best practices shared among 

12 relevant agencies, but recognizes the unique 

13 missions, objectives, and responsibilities of each 

14 agency; 

15 (7) identify and assess data and information 

16 gaps necessary to develop natural resources adapta17 tion plans and strategies; and 

18 (8) consider strategies that engage youth and 

19 young adults (including youth and young adults 

20 working in full-time or part-time youth service or 

21 conservation corps programs) to provide the youth 

22 and young adults with opportunities for meaningful 

23 conservation and community service and to encour24 age opportunities for employment in the private sec25 tor through partnerships with employers. 


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1 (d) IMPLEMENTATION.— 

2 (1) IN GENERAL.—Upon approval by the Presi3 dent, each department or agency with representation 

4 on the Panel shall, consistent with existing author5 ity, implement the adaptation plan of the depart6 ment or agency through existing and new plans, 

7 policies, programs, activities, and actions. 

8 (2) CONSIDERATION OF IMPACTS.— 

9 (A) IN GENERAL.—To the maximum ex10 tent practicable and consistent with existing au11 thority, natural resource management decisions 

12 made by the department or agency shall— 

13 (i) consider the ongoing and expected 

14 impacts of climate change, including, 

15 where applicable, ocean acidification, 

16 drought, flooding, nd wildfire on natural 

17 resources; and 

18 (ii) choose alternatives that will avoid 

19 and minimize those impacts and promote 

20 resilience. 

21 (B) GUIDANCE.—The Council on Environ22 mental Quality shall provide guidance for Fed23 eral departments and agencies considering those 

24 impacts and choosing alternatives that will 


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1 avoid and minimize those impacts and promote 

2 resilience. 

3 (e) REVISION AND REVIEW.—Not less than every 5 

4 years, each department or agency shall review and revise 

5 the adaptation plan of the department or agency to incor6 porate the best available science, and other information, 

7 regarding the ongoing and expected impacts of climate 

8 change on natural resources. 

9 SEC. 369. STATE NATURAL RESOURCES ADAPTATION 

10 PLANS. 

11 (a) REQUIREMENT.—In order to be eligible for funds 

12 under section 370, not later than 1 year after the develop13 ment of the Strategy, each State shall prepare a State nat14 ural resources adaptation plan detailing current and fu15 ture efforts of the State to address the ongoing and ex16 pected impacts of climate change on natural resources and 

17 coastal areas within the jurisdiction of the State. 

18 (b) REVIEW OR APPROVAL.— 

19 (1) IN GENERAL.—The Secretary of the Inte20 rior and, as applicable, the Secretary of Commerce 

21 shall review each State adaptation plan, and approve 

22 the plan if the plan— 

23 (A) meets the requirements of subsection 

24 (c); and 

25 (B) is consistent with the Strategy. 


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1 (2) APPROVAL OR DISAPPROVAL.—The Sec2 retary of the Interior and, as applicable, the Sec3 retary of Commerce shall approve or disapprove the 

4 plan by written notice not later than 180 days after 

5 the date of submission of the plan (or a revised 

6 plan). 

7 (3) RESUBMISSION.—Not later than 90 days 

8 after the date of resubmission of an adaptation plan 

9 that has been disapproved under paragraph (2), the 

10 Secretary of the Interior and, as applicable, the Sec11 retary of Commerce, shall approve or disapprove the 

12 plan by written notice. 

13 (c) CONTENTS.—A State natural resources adapta14 tion plan shall— 

15 (1) include strategies for addressing the ongo16 ing and expected impacts of climate change, includ17 ing, where applicable, ocean acidification, drought, 

18 flooding, and wildfire on terrestrial, marine, estua19 rine, and freshwater fish, wildlife, plants, habitats, 

20 ecosystems, wildlife health, and ecological processes 

21 that— 

22 (A) describe the ongoing and expected im23 pacts of climate change, including, where appli24 cable, ocean acidification, drought, flooding, 

25 and wildfire on the diversity and health of fish, 


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1 wildlife and plant populations, habitats, eco2 systems, and associated ecological processes; 

3 (B) establish programs for monitoring the 

4 ongoing and expected impacts of climate 

5 change, including, where applicable, ocean acidi6 fication, drought, flooding, and wildfire on fish, 

7 wildlife, and plant populations, habitats, eco8 systems, and associated ecological processes; 

9 (C) describe and prioritize proposed con10 servation actions that increase the ability of 

11 fish, wildlife, plant populations, habitats, eco12 systems, and associated ecological processes to 

13 become more resilient, adapt to, and better 

14 withstand those impacts; 

15 (D) consider strategies that engage youth 

16 and young adults (including youth and young 

17 adults working in full-time or part-time youth 

18 service or conservation corps programs) to pro19 vide the youth and young adults with opportu20 nities for meaningful conservation and commu21 nity service and to encourage opportunities for 

22 employment in the private sector through part23 nerships with employers; 


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1 (E) integrate protection and restoration of 

2 resource resilience into agency decision making 

3 and specific conservation actions; 

4 (F) include a time frame for implementing 

5 conservation actions for fish, wildlife, and plant 

6 populations, habitats, ecosystems, and associ7 ated ecological processes; 

8 (G) establish methods— 

9 (i) for assessing the effectiveness of 

10 strategies and conservation actions taken 

11 to increase the ability of fish, wildlife, and 

12 plant populations, habitats, ecosystems, 

13 and associated ecological processes to be14 come more resilient, adapt to, and better 

15 withstand the ongoing and expected im16 pacts of climate changes, including, where 

17 applicable, ocean acidification, drought, 

18 flooding, and wildfire; and 

19 (ii) for updating strategies and ac20 tions to respond appropriately to new in21 formation or changing conditions; 

22 (H) are incorporated into a revision of the 

23 State wildlife action plan (also known as the 

24 State comprehensive wildlife strategy) that has 

25 been— 


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1 (i) submitted to the United States 

2 Fish and Wildlife Service; and 

3 (ii) approved, or is pending approval, 

4 by the United States Fish and Wildlife 

5 Service; and 

6 (I) are developed— 

7 (i) with the participation of the State 

8 fish and wildlife agency, the State coastal 

9 agency, the State agency responsible for 

10 administration of Land and Water Con11 servation Fund grants, the State Forest 

12 Legacy program coordinator, and other 

13 State agencies considered appropriate by 

14 the Governor of the State; 

15 (ii) in coordination with the Secretary 

16 of the Interior, and where applicable, the 

17 Secretary of Commerce; and 

18 (iii) in coordination with other States 

19 that share jurisdiction over natural re20 sources with the State; and 

21 (2) in the case of a coastal State, include strat22 egies for addressing the ongoing and expected im23 pacts of climate change, including, where applicable, 

24 ocean acidification, drought, flooding, and wildfire 

25 on a coastal zone that— 


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1 (A) identify natural resources likely to be 

2 impacted by climate change, and describe the 

3 impacts; 

4 (B) identify and prioritize continuing re5 search and data collection needed to address 

6 the impacts, including— 

7 (i) acquisition of high-resolution 

8 coastal elevation and nearshore bathymetry 

9 data; 

10 (ii) historic shoreline position maps, 

11 erosion rates, and inventories of shoreline 

12 features and structures; 

13 (iii) measures and models of relative 

14 rates of sea level rise or lake level changes, 

15 including effects on flooding, storm surge, 

16 inundation, and coastal geological proc17 esses; 

18 (iv) measures and models of habitat 

19 loss, including projected losses of coastal 

20 wetlands and potentials for inland migra21 tion of natural shoreline habitats; 

22 (v) measures and models of ocean and 

23 coastal species and ecosystem migrations, 

24 and changes in species population dynam25 ics; 


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1 (vi) changes in storm frequency, in2 tensity, or rainfall patterns; 

3 (vii) measures and models of saltwater 

4 intrusion into coastal rivers and aquifers; 

5 (viii) changes in chemical or physical 

6 characteristics of marine and estuarine 

7 systems, including the presence, extent, 

8 and timing of hypoxic and anoxic condi9 tions; 

10 (ix) measures and models of increased 

11 harmful algal blooms; and 

12 (x) measures and models of the 

13 spread of invasive species; 

14 (C) identify and prioritize adaptation strat15 egies to protect, restore, and conserve natural 

16 resources to enable natural resources to become 

17 more resilient, adapt to, and withstand the on18 going and expected impacts of climate change, 

19 including, where applicable, ocean acidification, 

20 drought, flooding, and wildfire, including— 

21 (i) protection, maintenance, and res22 toration of ecologically important coastal 

23 lands, coastal and ocean ecosystems, and 

24 species biodiversity and the establishment 


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1 of habitat buffer zones, migration cor2 ridors, and climate refugia; and 

3 (ii) improved planning, siting policies, 

4 hazard mitigation strategies, and State 

5 property insurance programs; 

6 (D) establish programs— 

7 (i) for the long-term monitoring of the 

8 ongoing and expected impacts of climate 

9 change, including, where applicable, ocean 

10 acidification, drought, flooding, and wild11 fire on the ocean and coastal zone; and 

12 (ii) assess and adjust, when necessary, 

13 the adaptive management strategies; 

14 (E) establish performance measures that— 

15 (i) assess the effectiveness of adapta16 tion strategies intended to improve resil17 ience and the ability of natural resources 

18 to adapt to and withstand the ongoing and 

19 expected impacts of climate change, includ20 ing, where applicable, ocean acidification, 

21 drought, flooding, and wildfire; 

22 (ii) assess the effectiveness of adapta23 tion strategies intended to minimize those 

24 impacts on the coastal zone; and 


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1 (iii) update the strategies to respond 

2 to new information or changing conditions; 

3 and 

4 (F) are developed— 

5 (i) with the participation of the State 

6 coastal agency and other appropriate State 

7 agencies; and 

8 (ii) in coordination with the Secretary 

9 of Commerce and other appropriate Fed10 eral agencies. 

11 (d) PUBLIC INPUT.—In developing the adaptation 

12 plan, a State shall provide for solicitation and consider13 ation of public input and independent scientific input. 

14 (e) COORDINATION WITH OTHER PLANS.—The State 

15 adaptation plan shall review research and information 

16 and, where appropriate, integrate the goals and measures 

17 set forth in other natural resources conservation strate18 gies, including— 

19 (1) the National Fish Habitat Action Plan; 

20 (2) plans under the North American Wetlands 

21 Conservation Act (16 U.S.C. 4401 et seq.); 

22 (3) the Federal, State, and local partnership 

23 known as ‘‘Partners in Flight’’; 


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1 (4) federally approved coastal zone management 

2 plans under the Coastal Zone Management Act of 

3 1972 (16 U.S.C. 1451 et seq.); 

4 (5) federally approved regional fishery manage5 ment plants and habitat conservation activities 

6 under the Magnuson-Stevens Fishery Conservation 

7 and Management Act (16 U.S.C. 1801 et seq.); 

8 (6) the National Coral Reef Action Plan; 

9 (7) recovery plans for threatened species and 

10 endangered species under section 4(f) of the Endan11 gered Species Act of 1973 (16 U.S.C. 1533(f)); 

12 (8) habitat conservation plans under section 10 

13 of that Act (16 U.S.C. 1539); 

14 (9) other Federal, State, and tribal plans for 

15 imperiled species; 

16 (10) State or tribal hazard mitigation plans; 

17 (11) State or tribal water management plans; 

18 (12) State property insurance programs; and 

19 (13) other State-based strategies that com20 prehensively implement adaptation activities to re21 mediate the ongoing and expected effects of climate 

22 change, including, where applicable, ocean acidifica23 tion, drought, flooding, and wildfire, on terrestrial, 

24 marine, and freshwater fish, wildlife, plants, and 

25 other natural resources. 


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1 (f) UPDATING.—Each State plan shall be updated at 

2 least every 5 years. 

3 (g) FUNDING.— 

4 (1) IN GENERAL.—Funds allocated to States 

5 under section 370 shall be used only for activities 

6 consistent with a State natural resources adaptation 

7 plan approved by the Secretary of the Interior and, 

8 as appropriate, the Secretary of Commerce. 

9 (2) FUNDING PRIOR TO THE APPROVAL OF A

10 STATE PLAN.—Until the earlier of the date that is 

11 3 years after the date of enactment of this Act or 

12 the date on which a State adaptation plan is ap13 proved, a State shall be eligible to receive funding 

14 under section 370 for adaptation activities that 

15 are— 

16 (A) consistent with the comprehensive 

17 wildlife strategy of the State and, where appro18 priate, other natural resources conservation 

19 strategies; and 

20 (B) in accordance with a work plan devel21 oped in coordination with— 

22 (i) the Secretary of the Interior; and 

23 (ii) the Secretary of Commerce. 

24 (3) COASTAL STATE.—In developing a work 

25 plan under paragraph (2)(B), a coastal State shall 


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1 coordinate with the Secretary of Commerce only for 

2 those portions of the strategy relating to activities 

3 affecting the coastal zone. 

4 (4) PENDING APPROVAL.—During the period 

5 for which approval by the applicable Secretary is 

6 pending, the State may continue to receive funds 

7 under section 370 pursuant to the work plan de8 scribed in paragraph (2)(B). 

9 SEC. 370. NATURAL RESOURCES CLIMATE CHANGE ADAP10 TATION ACCOUNT. 

11 (a) DISTRIBUTION OF AMOUNTS.— 

12 (1) STATES.—Of the amounts made available 

13 for each fiscal year to carry out this subpart, 38.5 

14 percent shall be provided to States to carry out nat15 ural resources adaptation activities in accordance 

16 with adaptation plans approved under section 369, 

17 and shall be distributed as follows: 

18 (A) 32.5 percent shall be available to State 

19 wildlife agencies in accordance with the appor20 tionment formula established under the second 

21 subsection (c) (relating to the apportionment of 

22 the Wildlife Conservation and Restoration Ac23 count) of section 4 of the Pittman-Robertson 

24 Wildlife Restoration Act (16 U.S.C. 669c); and 


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1 (B) 6 percent shall be available to State 

2 coastal agencies pursuant to the formula estab3 lished by the Secretary of Commerce under sec4 tion 306(c) of the Coastal Management Act of 

5 1972 (16 U.S.C. 1455(c)). 

6 (2) NATURAL RESOURCE ADAPTATION.—Of the 

7 amounts made available for each fiscal year to carry 

8 out this subpart— 

9 (A) 17 percent shall be allocated to the 

10 Secretary of the Interior for use in funding— 

11 (i) natural resources adaptation activi12 ties carried out— 

13 (I) under endangered species, mi14 gratory species, and other fish and 

15 wildlife programs administered by the 

16 National Park Service, the United 

17 States Fish and Wildlife Service, the 

18 Bureau of Indian Affairs, and the Bu19 reau of Land Management; 

20 (II) on wildlife refuges, National 

21 Park Service land, and other public 

22 land under the jurisdiction of the 

23 United States Fish and Wildlife Serv24 ice, the Bureau of Land Management, 


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1 the Bureau of Indian Affairs, or the 

2 National Park Service; and 

3 (III) within Federal water man4 aged by the Bureau of Reclamation 

5 and the National Park Service; and 

6 (ii) the implementation of the Na7 tional Fish and Wildlife Habitat and Cor8 ridors Information Program required by 

9 section 371; 

10 (B) 5 percent shall be allocated to the Sec11 retary of the Interior for natural resources ad12 aptation activities carried out under cooperative 

13 grant programs, including— 

14 (i) the cooperative endangered species 

15 conservation fund authorized under section 

16 6 of the Endangered Species Act of 1973 

17 (16 U.S.C. 1535); 

18 (ii) programs under the North Amer19 ican Wetlands Conservation Act (16 

20 U.S.C. 4401 et seq.); 

21 (iii) the Neotropical Migratory Bird 

22 Conservation Fund established by section 

23 9(a) of the Neotropical Migratory Bird 

24 Conservation Act (16 U.S.C. 6108(a)); 


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1 (iv) the Coastal Program of the 

2 United States Fish and Wildlife Service; 

3 (v) the National Fish Habitat Action 

4 Plan; 

5 (vi) the Partners for Fish and Wildlife 

6 Program; 

7 (vii) the Landowner Incentive Pro8 gram; 

9 (viii) the Wildlife Without Borders 

10 Program of the United States Fish and 

11 Wildlife Service; and 

12 (ix) the Migratory Species Program 

13 and Park Flight Migratory Bird Program 

14 of the National Park Service; and 

15 (C) 3 percent shall be allocated to the Sec16 retary of the Interior to provide financial assist17 ance to Indian tribes to carry out natural re18 sources adaptation activities through the Tribal 

19 Wildlife Grants Program of the United States 

20 Fish and Wildlife Service. 

21 (3) LAND AND WATER CONSERVATION.— 

22 (A) DEPOSITS.— 

23 (i) IN GENERAL.—Of the amounts 

24 made available for each fiscal year to carry 

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1 posited in the Land and Water Conserva2 tion Fund established under section 2 of 

3 the Land and Water Conservation Fund 

4 Act of 1965 (16 U.S.C. 460l–5). 

5 (ii) USE OF DEPOSITS.—Deposits in 

6 the Land and Water Conservation Fund 

7 under this paragraph shall— 

8 (I) be supplemental to authoriza9 tions provided under section 3 of the 

10 Land and Water Conservation Fund 

11 Act of 1965 (16 U.S.C. 460l–6), 

12 which shall remain available for non13 adaptation needs; and 

14 (II) be available to carry out this 

15 subpart without further appropriation 

16 or fiscal year limitation. 

17 (B) DISTRIBUTION OF AMOUNTS.—Of the 

18 amounts deposited under this paragraph in the 

19 Land and Water Conservation Fund— 

20 (i) for the purposes of carrying out 

21 the natural resources adaptation activities 

22 through the acquisition of land and inter23 ests in land under section 6 of the Land 

24 and Water Conservation Fund Act of 1965 

(16 U.S.C. 460l–8), 1 25 ⁄6 shall be allocated 


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1 to the Secretary of the Interior and made 

2 available on a competitive basis— 

3 (I) to States, in accordance with 

4 the natural resources adaptation plans 

5 of States, and to Indian tribes; 

6 (II) notwithstanding section 5 of 

7 that Act (16 U.S.C. 460l–7); and 

8 (III) in addition to any funds 

9 provided pursuant to annual appro10 priations Acts, the Energy Policy Act 

11 of 2005 (42 U.S.C. 15801 et seq.), or 

12 any other authorization for non13 adaptation needs; 

(ii) 1 14 ⁄3 shall be allocated to the Sec15 retary of the Interior to carry out natural 

16 resources adaptation activities through the 

17 acquisition of lands and interests in land 

18 under section 7 of the Land and Water 

19 Conservation Fund Act of 1965 (16 U.S.C. 

20 460l–9); 

(iii) 1 21 ⁄6 shall be allocated to the Sec22 retary of Agriculture and made available to 

23 the States and Indian tribes to carry out 

24 natural resources adaptation activities 

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1 ests in land under section 7 of the Cooper2 ative Forestry Assistance Act of 1978 (16 

3 U.S.C. 2103c); and 

(iv) 1 4 ⁄3 shall be allocated to the Sec5 retary of Agriculture to carry out natural 

6 resources adaptation activities through the 

7 acquisition of land and interests in land 

8 under section 7 of the Land and Water 

9 Conservation Fund Act of 1965 (16 U.S.C. 

10 460l–9). 

11 (C) EXPENDITURE OF FUNDS.—In allo12 cating funds under subparagraph (B), the Sec13 retary of the Interior and the Secretary of Agri14 culture shall take into consideration factors in15 cluding— 

16 (i) the availability of non-Federal con17 tributions from State, local, or private 

18 sources; 

19 (ii) opportunities to protect fish and 

20 wildlife corridors or otherwise to link or 

21 consolidate fragmented habitats; 

22 (iii) opportunities to reduce the risk of 

23 catastrophic wildfires, drought, extreme 

24 flooding, or other climate-related events 


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1 that are harmful to fish and wildlife and 

2 people; and 

3 (iv) the potential for conservation of 

4 species or habitat types at serious risk due 

5 to climate change, including, where appli6 cable, ocean acidification, drought, flood7 ing, and wildfire, or other stressors. 

8 (4) NATIONAL FOREST AND GRASSLAND ADAP9 TATION.—Of the amounts made available for each 

10 fiscal year to carry out this subpart, 5 percent shall 

11 be allocated to the Forest Service, through the Sec12 retary of Agriculture— 

13 (A) to fund natural resources adaptation 

14 activities carried out in national forests and na15 tional grasslands under the jurisdiction of the 

16 Forest Service; and 

17 (B) to carry out natural resource adapta18 tion activities on State and private forest land 

19 carried out under the Cooperative Forestry As20 sistance Act of 1978 (16 U.S.C. 2101 et seq.). 

21 (5) COASTAL AND MARINE SYSTEM ADAPTA22 TION.—Of the amounts made available for each fis23 cal year to carry out this subpart, 7 percent shall be 

24 allocated to the Secretary of Commerce to fund nat25 ural resources adaptation activities that protect, 


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1 maintain, and restore coastal, estuarine, and marine 

2 resources, habitats, and ecosystems, including such 

3 activities carried out under— 

4 (A) the coastal and estuarine land con5 servation program administered by the National 

6 Oceanic and Atmospheric Administration; 

7 (B) the community-based restoration pro8 gram for fishery and coastal habitats estab9 lished under section 117 of the Magnuson-Ste10 vens Fishery Conservation and Management 

11 Reauthorization Act of 2006 (16 U.S.C. 

12 1891a); 

13 (C) the Coastal Zone Management Act of 

14 1972 (16 U.S.C. 1451 et seq.) that are specifi15 cally designed to strengthen the ability of coast16 al, estuarine, and marine resources, habitats, 

17 and ecosystems to adapt to and withstand the 

18 ongoing and expected impacts of climate 

19 change, including, where applicable, ocean acidi20 fication, drought, flooding, and wildfire; 

21 (D) the Open Rivers Initiative; 

22 (E) the Magnuson-Stevens Fishery Con23 servation and Management Act (16 U.S.C. 

24 1801 et seq.); 


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1 (F) the Marine Mammal Protection Act of 

2 1972 (16 U.S.C. 1361 et seq.); 

3 (G) the Endangered Species Act of 1973 

4 (16 U.S.C. 1531 et seq.); 

5 (H) the Marine Protection, Research, and 

6 Sanctuaries Act of 1972 (33 U.S.C. 1401 et 

7 seq.); 

8 (I) the Coral Reef Conservation Act of 

9 2000 (16 U.S.C. 6401 et seq.); and 

10 (J) the Estuary Restoration Act of 2000 

11 (33 U.S.C. 2901 et seq.). 

12 (6) ESTUARINE AND FRESHWATER ECOSYSTEM

13 ADAPTATION.—Of the amounts made available for 

14 each fiscal year to carry out this subpart, 7.5 per15 cent shall be allocated to the Administrator of the 

16 Environmental Protection Agency and 5 percent 

17 shall be available to the Secretary of the Army for 

18 use by the Corps of Engineers for use in natural re19 sources adaptation activities restoring and pro20 tecting— 

21 (A) large-scale freshwater aquatic eco22 systems, such as the Everglades, the Great 

23 Lakes, Flathead Lake, the Missouri River, the 

24 Mississippi River, the Colorado River, the Sac25 ramento-San Joaquin Rivers, the Ohio River, 


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1 the Columbia-Snake River System, the Apa2 lachicola, Chattahoochee, and Flint River Sys3 tem, the Connecticut River, and the Yellowstone 

4 River; 

5 (B) large-scale estuarine ecosystems, such 

6 as Chesapeake Bay, Long Island Sound, Puget 

7 Sound, the Mississippi River Delta, the San 

8 Francisco Bay Delta, Narragansett Bay, and 

9 Albemarle-Pamlico Sound; 

10 (C) freshwater and estuarine ecosystems, 

11 watersheds, and basins identified and 

12 prioritized by the Administrator of the Environ13 mental Protection Agency or the Corps of Engi14 neers, working in cooperation with other Fed15 eral agencies, States, tribal governments, local 

16 governments, scientists, and other conservation 

17 partners; and 

18 (D)(i) habitats and ecosystems through es19 tuary habitat restoration projects authorized by 

20 the Estuary Restoration Act of 2000 (33 

21 U.S.C. 2901 et seq.); 

22 (ii) project modifications for improvement 

23 of the environment; 

24 (iii) aquatic restoration and protection 

25 projects authorized by section 206 of the Water 


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1 Resources Development Act of 1996 (33 U.S.C. 

2 2330); and 

3 (iv) other appropriate programs and activi4 ties. 

5 (b) USE OF FUNDS BY FEDERAL DEPARTMENTS AND

6 AGENCIES.—Funds allocated to Federal departments and 

7 agencies under this section shall only be used for natural 

8 resources adaptation activities consistent with an adapta9 tion plan approved under section 368. 

10 (c) STATE COST-SHARING.—Notwithstanding any 

11 other provision of law, a State that receives a grant under 

12 this section shall use funds from non-Federal sources to 

13 pay 10 percent of the costs of each activity carried out 

14 under the grant. 

15 SEC. 371. NATIONAL FISH AND WILDLIFE HABITAT AND 

16 CORRIDORS INFORMATION PROGRAM. 

17 (a) DEFINITIONS.—In this section: 

18 (1) GEOSPATIAL INTEROPERABILITY FRAME19 WORK.—The term ‘‘Geospatial Interoperability 

20 Framework’’ means the strategy used by the Na21 tional Biological Information Infrastructure (based 

22 on accepted standards, specifications, and protocols 

23 adopted through the International Standards Orga24 nization, the Open Geospatial Consortium, and the 

25 Federal Geographic Data Committee) to manage, arVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00352 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 chive, integrate, analyze, and make geospatial and 

2 biological data and metadata accessible. 

3 (2) PROGRAM.—The term ‘‘Program’’ means 

4 the National Fish and Wildlife Habitat and Cor5 ridors Information Program established under sub6 section (b). 

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

8 the Secretary of the Interior. 

9 (4) SYSTEM.—The term ‘‘System’’ means the 

10 Habitat and Corridors Information System estab11 lished under subsection (d)(1). 

12 (b) ESTABLISHMENT.—Not later than 180 days after 

13 the date of enactment of this Act, the Secretary, in co14 operation with the States and Indian tribes, shall establish 

15 a National Fish and Wildlife Habitat and Corridors Infor16 mation Program. 

17 (c) PURPOSE.—The purposes of the Program are— 

18 (1) to support States and Indian tribes in devel19 oping geographical information system databases of 

20 fish and wildlife habitats and corridors that— 

21 (A) inform planning and development deci22 sions within each State; 

23 (B) enable each State to model climate im24 pacts and adaptation; and 


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1 (C) provide geographically specific en2 hancements of State wildlife action plans; 

3 (2) to ensure the collaborative development of a 

4 comprehensive national geographic information sys5 tem database of maps, models, data, surveys, infor6 mational products, and other geospatial information 

7 regarding fish and wildlife habitat and corridors 

8 that— 

9 (A) is based on consistent protocols for 

10 sampling and mapping across landscapes; 

11 (B) takes into account regional differences; 

12 and 

13 (C) uses— 

14 (i) existing and planned State- and 

15 tribal-based geographical information sys16 tem databases; and 

17 (ii) existing databases, analytical 

18 tools, metadata activities, and other infor19 mation products available through the Na20 tional Biological Information Infrastruc21 ture maintained by the Secretary and non22 governmental organizations; and 

23 (3) to facilitate the use of those databases by 

24 Federal, State, local, and tribal decisionmakers to 

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1 life habitats and corridors at the earliest practicable 

2 stage for use in— 

3 (A) prioritizing and targeting natural re4 sources adaptation strategies and activities; 

5 (B) avoiding, minimizing, and mitigating 

6 the impacts on fish and wildlife habitat and cor7 ridors when locating energy development, water, 

8 transmission, transportation, and other land 

9 use projects; 

10 (C) assessing the impacts of existing devel11 opment on habitats and corridors; and 

12 (D) developing management strategies that 

13 enhance the ability of fish, wildlife, and plant 

14 species to migrate or respond to shifting habi15 tats within existing habitats and corridors. 

16 (d) HABITAT AND CORRIDORS INFORMATION SYS17 TEM.— 

18 (1) IN GENERAL.—The Secretary, in coopera19 tion with States and Indian tribes, shall establish a 

20 Habitat and Corridors Information System. 

21 (2) CONTENTS.—The System shall— 

22 (A) include maps, data, and descriptions of 

23 fish and wildlife habitat and corridors that— 

24 (i) have been developed by Federal 

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1 ural heritage programs, Indian tribes, local 

2 governments, nongovernmental organiza3 tions, and industry; and 

4 (ii) meet accepted geospatial inter5 operability framework data and metadata 

6 protocols and standards; 

7 (B) include maps and descriptions of pro8 jected shifts in habitats and corridors of fish 

9 and wildlife species in response to climate 

10 change; 

11 (C) ensure data quality; 

12 (D) at scales useful to decisionmakers, 

13 make data, models, and analyses included in 

14 the System available— 

15 (i) to prioritize and target natural re16 sources adaptation strategies and activi17 ties; 

18 (ii) to assess the impacts of existing 

19 development on habitats and corridors; 

20 (iii) to assess the impacts of proposed 

21 energy development, water, transmission, 

22 transportation, and other land use projects 

23 and to avoid, minimize, or mitigate those 

24 impacts on habitats and corridors; and 


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1 (iv) to develop management strategies 

2 that enhance the ability of fish, wildlife, 

3 and plant species to migrate or respond to 

4 shifting habitats within existing habitats 

5 and corridors; 

6 (E) update maps and other information as 

7 landscapes, habitats, corridors, and wildlife pop8 ulations change, or as new information becomes 

9 available; 

10 (F) encourage development of collaborative 

11 plans by Federal and State agencies and Indian 

12 tribes that monitor and evaluate the ability of 

13 the System to meet the needs of decision14 makers; 

15 (G) identify gaps in habitat and corridor 

16 information, mapping, and research needed to 

17 fully assess current data and metadata; 

18 (H) prioritize research and future data col19 lection activities for use in updating the System 

20 and provide support for those activities; 

21 (I) include mechanisms to support collabo22 rative research, mapping, and planning of habi23 tats and corridors by Federal and State agen24 cies, Indian tribes, and other interested stake25 holders; 


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1 (J) incorporate biological and geospatial 

2 data on species and corridors found in energy 

3 development and transmission plans, including 

4 renewable energy initiatives, transportation, and 

5 other land use plans; 

6 (K) identify, prioritize, and describe key 

7 parcels of non-Federal land that— 

8 (i) are located within units of the Na9 tional Park System, National Wildlife Ref10 uge System, National Forest System, or 

11 National Grassland System; and 

12 (ii) are critical to maintenance of 

13 wildlife habitat and migration corridors; 

14 and 

15 (L) be based on the best scientific informa16 tion available. 

17 (e) FINANCIAL AND OTHER SUPPORT.—The Sec18 retary may provide support to the States and Indian 

19 tribes, including financial and technical assistance, for ac20 tivities that support the development and implementation 

21 of the System. 

22 (f) COORDINATION.—In cooperation with States and 

23 Indian tribes, the Secretary shall recommend how the in24 formation in the System may be incorporated into relevant 


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1 State and Federal plans that affect fish and wildlife, in2 cluding— 

3 (1) land management plans; 

4 (2) the State Comprehensive Wildlife Conserva5 tion Strategies; and 

6 (3) appropriate tribal conservation plans. 

7 (g) PURPOSE OF INCORPORATION.—The Secretary 

8 shall make the recommendations required by subsection 

9 (f) to ensure that relevant State and Federal plans that 

10 affect fish and wildlife— 

11 (1) prevent unnecessary habitat fragmentation 

12 and disruption of corridors; 

13 (2) promote the landscape connectivity nec14 essary to allow wildlife to move as necessary to meet 

15 biological needs, adjust to shifts in habitat, and 

16 adapt to climate change; and 

17 (3) minimize the impacts of energy, develop18 ment, water, transportation, and transmission 

19 projects and other activities expected to impact habi20 tat and corridors. 

21 SEC. 372. ADDITIONAL PROVISIONS REGARDING INDIAN 

22 TRIBES. 

23 (a) FEDERAL TRUST RESPONSIBILITY.—Nothing in 

24 this subpart amends, alters, or gives priority over the Fed25 eral trust responsibility to any Indian tribe. 


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1 (b) EXEMPTION FROM FOIA.—If a Federal depart2 ment or agency receives any information relating to sacred 

3 sites or cultural activities identified by an Indian tribe as 

4 confidential, such information shall be exempt from disclo5 sure under section 552 of title 5, United States Code 

6 (commonly referred to as the Freedom of Information 

7 Act). 

8 (c) APPLICATION OF OTHER LAW.—The Secretary of 

9 the Interior may apply the provisions of the Indian Self10 Determination and Education Assistance Act (25 U.S.C. 

11 450 et seq.) in the implementation of this subpart. 

12 Subpart D—Additional Climate Change Adaptation 

13 Programs 

14 SEC. 381. WATER SYSTEM MITIGATION AND ADAPTION 

15 PARTNERSHIPS. 

16 (a) DEFINITIONS.—In this section: 

17 (1) OWNER OR OPERATOR.— 

18 (A) IN GENERAL.—The term ‘‘owner or 

19 operator’’ means a person (including a regional, 

20 local, municipal, or private entity) that owns or 

21 operates a water system. 

22 (B) INCLUSION.—The term ‘‘owner or op23 erator’’ includes— 


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1 (i) a non-Federal entity that has oper2 ational responsibilities for a federally or 

3 State owned water system; and 

4 (ii) an entity formed pursuant to any 

5 State’s joint exercise of powers statutes 

6 that includes one or more of the entities in 

7 paragraph (A). 

8 (2) WATER SYSTEM.—The term ‘‘water sys9 tem’’ means— 

10 (A) a community water system (as defined 

11 in section 1401 of the Safe Drinking Water Act 

12 (42 U.S.C. 300f)); 

13 (B) a treatment works (as defined in sec14 tion 212 of the Federal Water Pollution Control 

15 Act (33 U.S.C. 1292)), including a municipal 

16 separate storm sewer system; 

17 (C) a decentralized wastewater treatment 

18 system for domestic sewage; 

19 (D) a groundwater storage and replenish20 ment system; or 

21 (E) a system for transport and delivery of 

22 water for irrigation or conservation. 

23 (b) ESTABLISHMENT.—The Administrator shall es24 tablish a water system mitigation and adaptation partnerVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00361 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 ship program to provide funds to States for water system 

2 adaptation projects. 

3 (c) GRANTS.—Beginning in fiscal year 2010, each 

4 State receiving funds pursuant to this section shall make 

5 grants to owners or operators of water systems to address 

6 any ongoing or forecasted (based on the best available re7 search and data) climate-related impact on the water qual8 ity, water supply or reliability of a region of the United 

9 States, for the purposes of mitigating or adapting to the 

10 impacts of climate change. 

11 (d) ELIGIBLE USES.—The funds made available to 

12 each State pursuant to this section shall be used exclu13 sively to assist in the planning, design, construction, im14 plementation, or operation or maintenance of any program 

15 or project to respond or increase the resilience of a water 

16 system to climate change by— 

17 (1) conserving water or enhancing water use ef18 ficiency, including through the use of water metering 

19 and electronic sensing and control systems to meas20 ure the effectiveness of a water efficiency program; 

21 (2) modifying or relocating existing water sys22 tem infrastructure made or projected to be signifi23 cantly impaired by climate change impacts; 

24 (3) preserving or improving water quality, in25 cluding through measures to manage, reduce, treat, 


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1 or reuse municipal stormwater, wastewater, or 

2 drinking water; 

3 (4) investigating, designing, or constructing 

4 groundwater remediation, recycled water, or desali5 nation facilities or systems to serve existing commu6 nities; 

7 (5) enhancing water management by increasing 

8 watershed preservation and protection, such as 

9 through the use of natural or engineered green in10 frastructure in the management, conveyance, or 

11 treatment of water, wastewater, or stormwater; 

12 (6) enhancing energy efficiency or the use and 

13 generation of renewable energy in the management, 

14 conveyance, or treatment of water, wastewater, or 

15 stormwater; 

16 (7) supporting the adoption and use of ad17 vanced water treatment, water supply management 

18 (such as reservoir reoperation and water banking), 

19 or water demand management technologies, projects, 

20 or processes (such as water reuse and recycling, 

21 adaptive conservation pricing, and groundwater 

22 banking) that maintain or increase water supply or 

23 improve water quality; 

24 (8) modifying or replacing existing systems or 

25 constructing new systems for existing communities 


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1 or land currently in agricultural production to im2 prove water supply, reliability, storage, or convey3 ance in a manner that— 

4 (A) promotes conservation or improves the 

5 efficiency of utilization of available water sup6 plies; and 

7 (B) does not further exacerbate stresses on 

8 ecosystems or cause redirected impacts by de9 grading water quality or increasing net green10 house gas emissions; 

11 (9) supporting practices and projects, such as 

12 improved irrigation systems, water banking and 

13 other forms of water transactions, groundwater re14 charge, stormwater capture, groundwater conjunc15 tive use, and reuse or recycling of drainage water, 

16 to improve water quality or promote more efficient 

17 water use on land currently in agricultural produc18 tion; or 

19 (10) conducting and completing studies or as20 sessments to project how climate change may impact 

21 the future operations and sustainability of water sys22 tems. 

23 (e) APPLICATION.—To be eligible to receive a grant 

24 from the State under this section, the owner or operator 


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1 of a water system shall submit to the State an application 

2 that— 

3 (1) includes a proposal of the program, strat4 egy, or infrastructure improvement to be planned, 

5 designed, constructed, implemented, or maintained 

6 by the water system; 

7 (2) cites the best available research or data that 

8 demonstrate— 

9 (A) the risk to the water resources or in10 frastructure of the water system as a result of 

11 ongoing or forecasted changes to the 

12 hydrological system brought about by factors 

13 arising from climate change, including rising 

14 sea levels and changes in precipitation levels; 

15 and 

16 (B) how the proposed program, strategy, 

17 or infrastructure improvement would perform 

18 under the anticipated climate conditions; and 

19 (3) explains how the proposed program, strat20 egy, or infrastructure improvement is expected to 

21 enhance the resiliency of the water system, including 

22 source water protection for community water sys23 tems, to these risks or reduce the direct or indirect 

24 greenhouse gas emissions of the water system. 

25 (f) COMPETITIVE PROCESS.— 


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1 (1) IN GENERAL.—Each calendar year, each 

2 State shall conduct a competitive process to select 

3 and fund applications under this section. 

4 (2) PRIORITY REQUIREMENTS AND

5 WEIGHTING.—In carrying out the process, the 

6 States shall— 

7 (A) prioritize funding of applications that 

8 are submitted by the owners or operators of 

9 water systems that are, based on the best avail10 able research and data, at the greatest and 

11 most immediate risk of facing significant cli12 mate-related negative impacts on water quality 

13 or quantity; and 

14 (B) in selecting among the priority applica15 tions determined under subparagraph (A), en16 sure that, to the maximum extent practicable, 

17 the final list of applications funded for each 

18 year includes a substantial number meeting one 

19 or more of each of the following goals— 

20 (i) promote more efficient water use, 

21 water conservation, water reuse, or recy22 cling; 

23 (ii) use decentralized, low-impact de24 velopment technologies and nonstructural 

25 approaches, including practices that use, 


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1 enhance, or mimic the natural hydrological 

2 cycle or protect natural flows; 

3 (iii) reduce stormwater runoff by pro4 tecting or enhancing natural ecosystem 

5 functions; 

6 (iv) modify, upgrade, enhance, or re7 place existing water system infrastructure 

8 in response to ongoing or forecasted cli9 mate-related impacts; 

10 (v) promote the sustainability and re11 liability of water supplies used for agricul12 tural purposes; 

13 (vi) improve water quality or quantity 

14 for agricultural and municipal uses, includ15 ing through salinity reduction; and 

16 (vii) provide multiple benefits, includ17 ing to water supply enhancement or de18 mand reduction, water quality protection 

19 or improvement, increased flood protection, 

20 and ecosystem protection or improvement; 

21 and 

22 (C) provide for solicitation and consider23 ation of public input in the development of cri24 teria used in evaluating applications. 

25 (g) COST-SHARING.— 


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1 (1) FEDERAL SHARE.—The share of the cost of 

2 any program, strategy, or infrastructure improve3 ment that is the subject of a grant awarded by a 

4 State to the owner or operator of a water system 

5 under subsection (c) paid through funds distributed 

6 under this section shall not exceed 50 percent of the 

7 cost of the program, strategy, and infrastructure im8 provement. 

9 (2) CALCULATION OF NON-FEDERAL SHARE.— 

10 In calculating the non-Federal share of the cost of 

11 a program, strategy, or infrastructure improvement 

12 proposed by a water system through an application 

13 submitted by the water system under subsection (e), 

14 the State shall— 

15 (A) include the value of any in-kind serv16 ices that are integral to the completion of the 

17 program, strategy, or infrastructure improve18 ment, including reasonable administrative and 

19 overhead costs; and 

20 (B) not include any other amount that the 

21 water system receives from a Federal agency. 

22 (h) LABOR STANDARDS.— 

23 (1) IN GENERAL.—Other than with respect to 

24 employees of State and local agencies, or other pub25 lic entities, all laborers and mechanics employed on 


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1 infrastructure improvements funded directly by or 

2 assisted in whole or in part by this section shall be 

3 paid wages at rates not less than those prevailing for 

4 the same type of work on similar construction in the 

5 immediate locality, as determined by the Secretary 

6 of Labor in accordance with subchapter IV of chap7 ter 31 of part A of subtitle II of title 40, United 

8 States Code. 

9 (2) AUTHORITY AND FUNCTIONS.—With re10 spect to the labor standards in this subsection, the 

11 Secretary of Labor shall have the authority and 

12 functions set forth in Reorganization Plan Num13 bered 14 of 1950 (64 Stat. 1267; 5 U.S.C. App.) 

14 and section 3145 of title 40, United States Code. 

15 SEC. 382. FLOOD CONTROL, PROTECTION, PREVENTION, 

16 AND RESPONSE. 

17 (a) ESTABLISHMENT.—The Administrator shall es18 tablish a Flood Control, Protection, Prevention and Re19 sponse Program to provide funds to States for flood con20 trol, protection, prevention and response projects. 

21 (b) ELIGIBLE USES.— 

22 (1) IN GENERAL.—States receiving funding 

23 pursuant to this section may use such funding on 

24 flood control, protection, prevention and response 

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1 pacts of climate change in accordance with this sec2 tion. 

3 (2) OBJECTIVES.—Such projects and activities 

4 shall seek to mitigate or adapt to the destructive im5 pacts of climate related increases in the duration, 

6 frequency, or magnitude of rainfall or runoff, includ7 ing snowmelt runoff, as well as hurricanes, including 

8 projects and programs that— 

9 (A) reduce flood damage, risk, and vulner10 ability; 

11 (B) identify, maintain and restore eco12 systems and natural barriers integral to flood 

13 control, protection, prevention and response; 

14 (C) update the available data, technologies, 

15 and scientific knowledge used in estimating, 

16 identifying and mitigating flood hazards; 

17 (D) highlight, update and remediate 

18 vulnerabilities in emergency response; 

19 (E) incorporate risk analysis and a risk-re20 duction approach to flood-related investments; 

21 (F) incorporate and identify changes in 

22 risk due to processes such as land loss, subsid23 ence, sea-level rise, reduced natural buffers, 

24 urban development and infrastructure aging; 

25 and 


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1 (G) identify and incorporate innovative ap2 proaches to land use management, water re3 source planning, and ecosystem restoration. 

4 (3) PRIORITY.—Priority in projects to reduce 

5 flood events shall be given to those projects that di6 rectly assist local governments and communities in 

7 flood control, protection, prevention and response ac8 tivities. 

9 SEC. 383. WILDFIRE. 

10 (a) FINDINGS.—Congress finds that— 

11 (1) since 1980, wildfires in the United States 

12 have burned almost twice as many acres per year on 

13 average than the average burned acreage during the 

14 period beginning on January 1, 1920, and ending on 

15 December 31, 1979; 

16 (2) the wildfire season in the western United 

17 States has increased by an average of 78 days dur18 ing the 30-year period preceding the date of enact19 ment of this Act; 

20 (3) researchers predict that the area subject to 

21 wildfire damage will increase during the 21st cen22 tury by up to 118 percent as a result of climate 

23 change; 


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1 (4) of the annual budget of the Forest Service, 

2 the Forest Service used for wildfire suppression ac3 tivities— 

4 (A) 13 percent in 1991; and 

5 (B) 45 percent in 2007; and 

6 (5) 1 percent of the largest escaped fires— 

7 (A) burn 95 percent of all burned acres; 

8 and 

9 (B) consume 85 percent of all wildfire 

10 fighting costs. 

11 (b) PURPOSE.—The purpose of this section is to au12 thorize a program to reduce the risk of wildfires in fire13 ready communities. 

14 (c) DEFINITIONS.—In this section: 

15 (1) FIRE-READY COMMUNITY.—The term ‘‘fire16 ready community’’ means a community that— 

17 (A) is located within a priority area identi18 fied pursuant to subsection (d); 

19 (B) has a cooperative fire agreement that 

20 articulates the roles and responsibilities for 

21 Federal, State and local government entities in 

22 local wildfire suppression and protection; 

23 (C) has local codes that require fire-resist24 ant home design and building materials; 


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1 (D) has a community wildfire protection 

2 plan (as defined in section 101 of the Healthy 

3 Forests Restoration Act of 2003 (16 U.S.C. 

4 6502)); and 

5 (E) is engaged in a successful collaborative 

6 process that includes multiple interested per7 sons representing diverse interests and is trans8 parent and nonexclusive, such as a resource ad9 visory committee established under section 205 

10 of the Secure Rural Schools and Community 

11 Self-Determination Act of 2000 (Public Law 

12 106–393; 16 U.S.C. 500 note). 

13 (2) SECRETARIES.—The term ‘‘Secretaries’’ 

14 means the Secretary of Agriculture and the Sec15 retary of the Interior. 

16 (d) FIRE RISK MAPPING.—As soon as is practicable 

17 after the date of the enactment of this Act, the Secretaries 

18 shall develop regional maps of communities most at risk 

19 of wildfire and in need of hazardous fuel treatment and 

20 maintenance. The maps shall identify priority areas for 

21 hazardous fuels reduction projects, including— 

22 (1) at-risk communities in fire-prone areas of 

23 the wildland-urban interface (as defined in section 

24 101 of the Healthy Forests Restoration Act of 2003 

25 (16 U.S.C. 6502)); 


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1 (2) watersheds and municipal drinking water 

2 sources; 

3 (3) emergency evacuation corridors; 

4 (4) electricity transmission corridors; 

5 (5) low-capacity or low-income communities; 

6 and 

7 (6) communities in fire-prone areas due to the 

8 impact of pest infestation on forest resources. 

9 (e) LOCAL WILDLAND FIREFIGHTING CAPABILITY

10 GRANTS.— 

11 (1) GRANTS AVAILABLE.—The Secretaries may 

12 provide cost-share grants to fire-ready communities 

13 to assist such communities in carrying out activities 

14 authorized by paragraph (2). 

15 (2) ELIGIBLE ACTIVITIES.—Grant funds may 

16 be used for the following: 

17 (A) Education programs to raise aware18 ness of homeowners and citizens about wildland 

19 fire protection practices, including FireWise or 

20 similar programs. 

21 (B) Training programs for local fire22 fighters on wildland firefighting techniques and 

23 approaches. 

24 (C) Equipment acquisition to facilitate 

25 wildland fire preparedness. 


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1 (D) Implementation of a community wild2 fire protection plan. 

3 (E) Forest restoration that accomplishes 

4 fuels reduction. 

5 (f) WILDLAND FIRE COST-SHARE AGREEMENTS.— 

6 In developing any wildland fire cost-share agreement with 

7 a State Forester or equivalent official, the Secretaries 

8 shall, to the maximum extent practicable, encourage the 

9 State and local communities involved to become fire-ready 

10 communities. 

11 SEC. 384. COASTAL AND GREAT LAKES STATE ADAPTATION 

12 PROGRAM. 

13 (a) FINDINGS.—According to the National Ocean Ec14 onomics Program, coastal and Great Lakes States account 

15 for 81.4 percent of the population of the United States 

16 and generate 83 percent of the economic output of the 

17 United States. 

18 (b) DEFINITIONS.—In this section: 

19 (1) COASTAL STATE.—The term ‘‘coastal 

20 State’’ has the meaning given the term ‘‘coastal 

21 state’’ in section 304 of the Coastal Zone Manage22 ment Act of 1972 (16 U.S.C. 1453). 

23 (2) COASTAL WATERSHED.—The term ‘‘coastal 

24 watershed’’ means a geographical area drained into 

25 or contributing water to an estuarine area, an ocean, 


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1 or a Great Lake, all or a portion of which is within 

2 the coastal zone (as defined in section 304 of the 

3 Coastal Zone Management Act of 1972 (16 U.S.C. 

4 1453)). 

5 (3) SHORELINE MILES.—The term ‘‘shoreline 

6 miles’’, with respect to a coastal State, means the 

7 mileage of tidal shoreline or Great Lake shoreline of 

8 the coastal State, based on the most recently avail9 able data from or accepted by the National Ocean 

10 Service of the National Oceanic and Atmospheric 

11 Administration. 

12 (c) DISTRIBUTION.— 

13 (1) IN GENERAL.—The Administrator shall dis14 tribute, in accordance with this section, funding for 

15 coastal State economic protection under subsection. 

16 (2) ALLOCATION.—The funding available for al17 location under subsection (b) for a calendar year 

18 shall be distributed among coastal States, as follows: 

19 (A) 25 percent based on the proportion 

20 that— 

21 (i) the number of shoreline miles of a 

22 coastal State; bears to 

23 (ii) the total number of shoreline 

24 miles of all coastal States. 


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1 (B) 25 percent based on the proportion 

2 that— 

3 (i) the population of a coastal State; 

4 bears to 

5 (ii) the total population of all coastal 

6 States. 

7 (C) 50 percent divided equally among all 

8 coastal States. 

9 (d) USE OF FUNDING.— 

10 (1) IN GENERAL.—During any calendar year, a 

11 coastal State receiving funding under this section 

12 may use the funding only for projects and activities 

13 to plan for and address the impacts of climate 

14 change in the coastal watershed, including— 

15 (A) to address the impacts of climate 

16 change with respect to— 

17 (i) accelerated sea level rise and lake 

18 level changes; 

19 (ii) shoreline erosion; 

20 (iii) increased storm frequency or in21 tensity; 

22 (iv) changes in rainfall or other pre23 cipitation; and 

24 (v) related flooding; 


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1 (B) to identify and develop plans to pro2 tect, or, as necessary or applicable, to relocate 

3 public facilities and infrastructure, coastal re4 sources of national significance, public energy 

5 facilities, or other public water uses located in 

6 the coastal watershed that are affected by cli7 mate change, including strategies that use nat8 ural resources, such as natural buffer zones, 

9 natural shorelines, and habitat protection or 

10 restoration; 

11 (C) to research and collect data using, or 

12 on matters such as— 

13 (i) historical shoreline position maps; 

14 (ii) historical shoreline erosion rates; 

15 (iii) inventories of shoreline features 

16 and conditions; 

17 (iv) acquisition of high-resolution to18 pography and bathymetry; 

19 (v) sea level rise inundation models; 

20 (vi) storm surge sea level rise linked 

21 inundation models; 

22 (vii) shoreline change modeling based 

23 on sea level rise projections; 

24 (viii) sea level rise vulnerability anal25 yses and socioeconomic studies; and 


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1 (ix) environmental and habitat 

2 changes associated with sea level rise; and 

3 (D) to respond to— 

4 (i) changes in chemical characteristics 

5 (including ocean acidification) and physical 

6 characteristics (including thermal strati7 fication) of marine systems; 

8 (ii) saltwater intrusion into ground9 water aquifers; 

10 (iii) increased harmful algae blooms; 

11 (iv) spread of invasive species; 

12 (v) coastal habitat loss; 

13 (vi) species migrations; and 

14 (vii) marine, estuarine, and freshwater 

15 ecosystem changes associated with climate 

16 change. 

17 (2) EXECUTION.—Priority to plan and carry 

18 out projects and activities under this subsection shall 

19 be given to State coastal agencies, as determined in 

20 accordance with State law. 

21 (3) COORDINATION.—In carrying out this sub22 section, a coastal State shall coordinate with other 

23 statewide climate change efforts in order to avoid 

24 duplication of such efforts. 


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1 (e) REPORT.—Not later than 1 year after the date 

2 on which a State receives funds under this section, and 

3 biennially thereafter until such time as the funding is fully 

4 expended, the State shall submit to the Administrator, or 

5 the heads of such other Federal agencies as the President 

6 may designate, a report that— 

7 (1) provides a full accounting for the State’s 

8 use of funding distributed under this section, includ9 ing a description of the projects and activities fund10 ed; and 

11 (2) may be independent or included within any 

12 report required for any State programs for green13 house gas reduction and climate adaptation. 

14 DIVISION B—POLLUTION 

15 REDUCTION AND INVESTMENT 

16 TITLE I—REDUCING GLOBAL 

17 WARMING POLLUTION 

18 Subtitle A—Reducing Global 

19 Warming Pollution 

20 SEC. 101. REDUCING GLOBAL WARMING POLLUTION. 

21 The Clean Air Act is amended by adding after title 

22 VI (42 U.S.C. 7671 et seq.) the following: 


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1 ‘‘TITLE VII—GLOBAL WARMING 

2 POLLUTION REDUCTION AND 

3 INVESTMENT PROGRAM 

4 ‘‘PART A—GLOBAL WARMING POLLUTION 

5 REDUCTION GOALS AND TARGETS 

6 ‘‘SEC. 701. FINDINGS. 

7 ‘‘Congress finds that— 

8 ‘‘(1) global warming poses a significant threat 

9 to the national security, economy, public health and 

10 welfare, and environment of the United States, as 

11 well as of other countries; 

12 ‘‘(2) reviews of scientific studies, including by 

13 the Intergovernmental Panel on Climate Change and 

14 the National Academy of Sciences, demonstrate that 

15 global warming is the result of the combined anthro16 pogenic greenhouse gas emissions from numerous 

17 sources of all types and sizes; 

18 ‘‘(3) each increment of emission, when com19 bined with other emissions, causes or contributes 

20 materially to the acceleration and extent of global 

21 warming and its adverse effects for the lifetime of 

22 such gas in the atmosphere; 

23 ‘‘(4) accordingly, controlling emissions in small 

24 as well as large quantities is essential to prevent, 


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1 slow the pace of, reduce the threats from, and miti2 gate global warming and its adverse effects; 

3 ‘‘(5) because they induce global warming, 

4 greenhouse gas emissions cause or contribute to in5 juries to persons in the United States, including— 

6 ‘‘(A) adverse health effects, such as disease 

7 and loss of life; 

8 ‘‘(B) displacement of human populations; 

9 ‘‘(C) damage to property and other inter10 ests relating to ocean levels, acidification, and 

11 ice changes; 

12 ‘‘(D) severe weather and seasonal changes; 

13 ‘‘(E) disruption, costs, and losses to busi14 ness, trade, employment, farms, subsistence, 

15 aesthetic enjoyment of the environment, recre16 ation, culture, and tourism; 

17 ‘‘(F) damage to plants, forests, lands, and 

18 waters; 

19 ‘‘(G) harm to wildlife and habitat; 

20 ‘‘(H) scarcity of water and the decreased 

21 abundance of other natural resources; 

22 ‘‘(I) worsening of tropospheric air pollu23 tion; 

24 ‘‘(J) substantial threats of similar damage; 

25 and 


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1 ‘‘(K) other harm; 

2 ‘‘(6) the fact that many of those effects and 

3 risks of future effects of global warming are widely 

4 shared does not minimize the adverse effects indi5 vidual persons have suffered, will suffer, and are at 

6 risk of suffering because of global warming; 

7 ‘‘(7) the fact that some of the adverse and po8 tentially catastrophic effects of global warming are 

9 at risk of occurring and not a certainty does not ne10 gate the harm persons suffer from actions that in11 crease the likelihood, extent, and severity of such fu12 ture impacts; 

13 ‘‘(8) countries of the world look to the United 

14 States for leadership in addressing the threat of and 

15 harm from global warming; 

16 ‘‘(9) full implementation of this title is critical 

17 to engage other countries in an international effort 

18 to mitigate the threat of and harm from global 

19 warming; and 

20 ‘‘(10) global warming and its adverse effects 

21 are occurring and are likely to continue and increase 

22 in magnitude, and to do so at a greater and more 

23 harmful rate, unless the this title is fully imple24 mented and enforced in an expeditious manner. 


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1 ‘‘SEC. 702. ECONOMY-WIDE REDUCTION GOALS. 

2 ‘‘The goals of this title, and the Clean Energy Jobs 

3 and American Power Act (and the amendments made by 

4 that Act), are to reduce steadily the quantity of United 

5 States greenhouse gas emissions such that— 

6 ‘‘(1) in 2012, the quantity of United States 

7 greenhouse gas emissions does not exceed 97 percent 

8 of the quantity of United States greenhouse gas 

9 emissions in 2005; 

10 ‘‘(2) in 2020, the quantity of United States 

11 greenhouse gas emissions does not exceed 80 percent 

12 of the quantity of United States greenhouse gas 

13 emissions in 2005; 

14 ‘‘(3) in 2030, the quantity of United States 

15 greenhouse gas emissions does not exceed 58 percent 

16 of the quantity of United States greenhouse gas 

17 emissions in 2005; and 

18 ‘‘(4) in 2050, the quantity of United States 

19 greenhouse gas emissions does not exceed 17 percent 

20 of the quantity of United States greenhouse gas 

21 emissions in 2005. 

22 ‘‘SEC. 703. REDUCTION TARGETS FOR SPECIFIED SOURCES. 

23 ‘‘(a) IN GENERAL.—The regulations issued under 

24 section 721 shall limit and reduce annually the greenhouse 

25 gas emissions of capped sources each calendar year begin26 ning in 2012 such that— 


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1 ‘‘(1) in 2012, the quantity of greenhouse gas 

2 emissions from capped sources does not exceed 97 

3 percent of the quantity of greenhouse gas emissions 

4 from such sources in 2005; 

5 ‘‘(2) in 2020, the quantity of greenhouse gas 

6 emissions from capped sources does not exceed 80 

7 percent of the quantity of greenhouse gas emissions 

8 from such sources in 2005; 

9 ‘‘(3) in 2030, the quantity of greenhouse gas 

10 emissions from capped sources does not exceed 58 

11 percent of the quantity of greenhouse gas emissions 

12 from such sources in 2005; and 

13 ‘‘(4) in 2050, the quantity of greenhouse gas 

14 emissions from capped sources does not exceed 17 

15 percent of the quantity of greenhouse gas emissions 

16 from such sources in 2005. 

17 ‘‘(b) DEFINITION OF GREENHOUSE GAS EMISSIONS

18 FROM SUCH SOURCES IN 2005.—For purposes of this sec19 tion, the term ‘greenhouse gas emissions from such 

20 sources in 2005’ means emissions to which section 722 

21 would have applied if the requirements of this title for the 

22 specified year had been in effect for 2005. 

23 ‘‘SEC. 704. SUPPLEMENTAL POLLUTION REDUCTIONS. 

24 ‘‘For the purposes of decreasing the likelihood of cat25 astrophic climate change, preserving tropical forests, 


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1 building capacity to generate offset credits, and facili2 tating international action on global warming, the Admin3 istrator shall set aside a percentage specified in section 

4 771(d) of the quantity of emission allowances established 

5 under section 721(a) for each year, to be used to achieve 

6 a reduction of greenhouse gas emissions from deforest7 ation in developing countries in accordance with part E. 

8 In 2020, activities supported under part E shall provide 

9 greenhouse gas reductions in an amount equal to an addi10 tional 10 percentage points of reductions from United 

11 States greenhouse gas emissions in 2005. The Adminis12 trator shall distribute these allowances with respect to ac13 tivities in countries that enter into and implement agree14 ments or arrangements relating to reduced deforestation 

15 as described in section 753(a)(2). 

16 ‘‘SEC. 705. REVIEW AND PROGRAM RECOMMENDATIONS. 

17 ‘‘(a) IN GENERAL.—The Administrator shall, in con18 sultation with appropriate Federal agencies, submit to 

19 Congress a report not later than July 1, 2013, and every 

20 4 years thereafter, that includes— 

21 ‘‘(1) an analysis of key findings based on up22 to-date scientific information and data relevant to 

23 global climate change; 

24 ‘‘(2) an analysis of capabilities to monitor and 

25 verify greenhouse gas reductions on a worldwide 


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1 basis, including for the United States, as required 

2 under the Clean Energy Jobs and American Power 

3 Act (and the amendments made by that Act); and 

4 ‘‘(3) an analysis of the status of worldwide 

5 greenhouse gas reduction efforts, including imple6 mentation of the Clean Energy Jobs and American 

7 Power Act and other policies, both domestic and 

8 international, for reducing greenhouse gas emissions, 

9 preventing dangerous atmospheric concentrations of 

10 greenhouse gases, preventing significant irreversible 

11 consequences of climate change, and reducing vul12 nerability to the impacts of climate change. 

13 ‘‘(b) EXCEPTION.—Subsection (a)(3) shall not apply 

14 to the first report submitted under subsection (a). 

15 ‘‘(c) LATEST SCIENTIFIC INFORMATION.—The anal16 ysis required under subsection (a)(1) shall— 

17 ‘‘(1) address existing scientific information and 

18 reports, considering, to the greatest extent possible, 

19 the most recent assessment report of the Intergov20 ernmental Panel on Climate Change, reports by the 

21 United States Global Change Research Program, the 

22 Natural Resources Climate Change Adaptation 

23 Panel established under section 365 of the Clean 

24 Energy Jobs and American Power Act, and Federal 


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1 agencies, and the European Union’s global tempera2 ture data assessment; 

3 ‘‘(2) review trends and projections for— 

4 ‘‘(A) global and country-specific annual 

5 emissions of greenhouse gases, and cumulative 

6 greenhouse gas emissions produced between 

7 1850 and the present, including— 

8 ‘‘(i) global cumulative emissions of an9 thropogenic greenhouse gases; 

10 ‘‘(ii) global annual emissions of an11 thropogenic greenhouse gases; and 

12 ‘‘(iii) by country, annual total, annual 

13 per capita, and cumulative anthropogenic 

14 emissions of greenhouse gases for the top 

15 50 emitting nations; 

16 ‘‘(B) significant changes, both globally and 

17 by region, in annual net non-anthropogenic 

18 greenhouse gas emissions from natural sources, 

19 including permafrost, forests, or oceans; 

20 ‘‘(C) global atmospheric concentrations of 

21 greenhouse gases, expressed in annual con22 centration units as well as carbon dioxide 

23 equivalents based on 100-year global warming 

24 potentials; 


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1 ‘‘(D) major climate forcing factors, such as 

2 aerosols; 

3 ‘‘(E) global average temperature, expressed 

4 as seasonal and annual averages in land, ocean, 

5 and land-plus-ocean averages; and 

6 ‘‘(F) sea level rise; 

7 ‘‘(3) assess the current and potential impacts of 

8 global climate change on— 

9 ‘‘(A) human populations, including impacts 

10 on public health, economic livelihoods, subsist11 ence, tribal culture, human infrastructure, and 

12 displacement or permanent relocation due to 

13 flooding, severe weather, extended drought, ero14 sion, or other ecosystem changes; 

15 ‘‘(B) freshwater systems, including water 

16 resources for human consumption and agri17 culture and natural and managed ecosystems, 

18 flood and drought risks, and relative humidity; 

19 ‘‘(C) the carbon cycle, including impacts 

20 related to the thawing of permafrost, the fre21 quency and intensity of wildfire, and terrestrial 

22 and ocean carbon sinks; 

23 ‘‘(D) ecosystems and animal and plant 

24 populations, including impacts on species abun25 dance, phenology, and distribution; 


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1 ‘‘(E) oceans and ocean ecosystems, includ2 ing effects on sea level, ocean acidity, ocean 

3 temperatures, coral reefs, ocean circulation, 

4 fisheries, and other indicators of ocean eco5 system health; 

6 ‘‘(F) the cryosphere, including effects on 

7 ice sheet mass balance, mountain glacier mass 

8 balance, and sea-ice extent and volume; 

9 ‘‘(G) changes in the intensity, frequency, 

10 or distribution of severe weather events, includ11 ing precipitation, tropical cyclones, tornadoes, 

12 and severe heat waves; 

13 ‘‘(H) agriculture and forest systems; and 

14 ‘‘(I) any other indicators the Administrator 

15 deems appropriate; 

16 ‘‘(4) summarize any significant socioeconomic 

17 impacts of climate change in the United States, in18 cluding the territories of the United States, drawing 

19 on work by Federal agencies and the academic lit20 erature, including impacts on— 

21 ‘‘(A) public health; 

22 ‘‘(B) economic livelihoods, subsistence, and 

23 tribal culture; 


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1 ‘‘(C) displacement or permanent relocation 

2 due to flooding, severe weather, extended 

3 drought, or other ecosystem changes; 

4 ‘‘(D) human infrastructure, including 

5 coastal infrastructure vulnerability to extreme 

6 events and sea level rise, river floodplain infra7 structure, and sewer and water management 

8 systems; 

9 ‘‘(E) agriculture and forests, including ef10 fects on potential growing season, distribution, 

11 and yield; 

12 ‘‘(F) water resources for human consump13 tion, agriculture and natural and managed eco14 systems, flood and drought risks, and relative 

15 humidity; 

16 ‘‘(G) energy supply and use; and 

17 ‘‘(H) transportation; 

18 ‘‘(5) in assessing risks and impacts, use a risk 

19 management framework, including both qualitative 

20 and quantitative measures, to assess the observed 

21 and projected impacts of current and future climate 

22 change, accounting for— 

23 ‘‘(A) both monetized and non-monetized 

24 losses; 


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1 ‘‘(B) potential nonlinear, abrupt, or essen2 tially irreversible changes in the climate system; 

3 ‘‘(C) potential nonlinear increases in the 

4 cost of impacts; 

5 ‘‘(D) potential low-probability, high impact 

6 events; and 

7 ‘‘(E) whether impacts are transitory or es8 sentially permanent; and 

9 ‘‘(6) based on the findings of the Administrator 

10 under this section, as well as assessments produced 

11 by the Intergovernmental Panel on Climate Change, 

12 the United States Global Change Research program, 

13 and other relevant scientific entities— 

14 ‘‘(A) describe increased risks to natural 

15 systems and society that would result from an 

16 increase in global average temperature 3.6 de17 grees Fahrenheit (2 degrees Celsius) above the 

18 pre-industrial average or an increase in atmos19 pheric greenhouse gas concentrations above 450 

20 parts per million carbon dioxide equivalent; and 

21 ‘‘(B) identify and assess— 

22 ‘‘(i) significant residual risks not 

23 avoided by the thresholds described in sub24 paragraph (A); 


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1 ‘‘(ii) alternative thresholds or targets 

2 that may more effectively limit the risks 

3 identified pursuant to clause (i); and 

4 ‘‘(iii) thresholds above those described 

5 in subparagraph (A) which significantly in6 crease the risk of certain impacts or render 

7 them essentially permanent. 

8 ‘‘(d) STATUS OF MONITORING AND VERIFICATION

9 CAPABILITIES TO EVALUATE GREENHOUSE GAS REDUC10 TION EFFORTS.—The analysis required under subsection 

11 (a)(2) shall evaluate the capabilities of the monitoring, re12 porting, and verification systems used to quantify progress 

13 in achieving reductions in greenhouse gas emissions both 

14 globally and in the United States (as described in section 

15 702), including— 

16 ‘‘(1) quantification of emissions and emission 

17 reductions by entities participating in the pollution 

18 reduction and investment program under this title; 

19 ‘‘(2) quantification of emissions and emission 

20 reductions by entities participating in the offset pro21 gram under this title; 

22 ‘‘(3) quantification of emission and emission re23 ductions by entities regulated by performance stand24 ards; 


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1 ‘‘(4) quantification of aggregate net emissions 

2 and emission reductions by the United States; and 

3 ‘‘(5) quantification of global changes in net 

4 emissions and in sources and sinks of greenhouse 

5 gases. 

6 ‘‘(e) STATUS OF GREENHOUSE GAS REDUCTION EF7 FORTS.—The analysis required under subsection (a)(3) 

8 shall address— 

9 ‘‘(1) whether the programs under the Clean En10 ergy Jobs and American Power Act (and the amend11 ments made by that Act) and other Federal statutes 

12 are resulting in sufficient United States greenhouse 

13 gas emission reductions to meet the emissions reduc14 tion goals described in section 702, taking into ac15 count the use of offsets; and 

16 ‘‘(2) whether United States actions, taking into 

17 account international actions, commitments, and 

18 trends, and considering the range of plausible emis19 sions scenarios, are sufficient to avoid— 

20 ‘‘(A) atmospheric greenhouse gas con21 centrations above 450 parts per million carbon 

22 dioxide equivalent; 

23 ‘‘(B) global average surface temperature 

24 3.6 degrees Fahrenheit (2 degrees Celsius) 

25 above the pre-industrial average, or such other 


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1 temperature thresholds as the Administrator 

2 deems appropriate; and 

3 ‘‘(C) other temperature or greenhouse gas 

4 thresholds identified pursuant to subsection 

5 (c)(6)(B). 

6 ‘‘(f) RECOMMENDATIONS.— 

7 ‘‘(1) LATEST SCIENTIFIC INFORMATION.— 

8 Based on the analysis described in subsection (a)(1), 

9 each report under subsection (a) shall identify ac10 tions that could be taken to— 

11 ‘‘(A) improve the characterization of 

12 changes in the earth-climate system and im13 pacts of global climate change; 

14 ‘‘(B) better inform decision making and 

15 actions related to global climate change; 

16 ‘‘(C) mitigate risks to natural and social 

17 systems; and 

18 ‘‘(D) design policies to better account for 

19 climate risks. 

20 ‘‘(2) MONITORING, REPORTING AND

21 VERIFICATION.—Based on the analysis described in 

22 subsection (a)(2), each report under subsection (a) 

23 shall identify key gaps in measurement, reporting, 

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1 tions to improve the accuracy and reliability of those 

2 capabilities. 

3 ‘‘(3) STATUS OF GREENHOUSE GAS REDUCTION

4 EFFORTS.—Based on the analysis described in sub5 section (a)(3), taking into account international ac6 tions, commitments, and trends, and considering the 

7 range of plausible emissions scenarios, each report 

8 under subsection (a) shall identify— 

9 ‘‘(A) the quantity of additional reductions 

10 required to meet the emissions reduction goals 

11 in section 702; 

12 ‘‘(B) the quantity of additional reductions 

13 in global greenhouse gas emissions needed to 

14 avoid the concentration and temperature 

15 thresholds identified in subsection (e); and 

16 ‘‘(C) possible strategies and approaches for 

17 achieving additional reductions. 

18 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There 

19 are authorized to be appropriated to carry out this section 

20 such sums as may be necessary. 

21 ‘‘SEC. 706. NATIONAL ACADEMY REVIEW. 

22 ‘‘(a) IN GENERAL.—Not later than 1 year after the 

23 date of enactment of this title, the Administrator shall 

24 offer to enter into a contract with the National Academy 

25 of Sciences (in this section referred to as the ‘Academy’) 


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1 under which the Academy shall, not later than July 1, 

2 2014, and every 4 years thereafter, submit to Congress 

3 and the Administrator a report that includes— 

4 ‘‘(1) a review of the most recent report and rec5 ommendations issued under section 705; and 

6 ‘‘(2) an analysis of technologies to achieve re7 ductions in greenhouse gas emissions. 

8 ‘‘(b) FAILURE TO ISSUE A REPORT.—In the event 

9 that the Administrator has not issued all or part of the 

10 most recent report required under section 705, the Acad11 emy shall conduct its own review and analysis of the re12 quired information. 

13 ‘‘(c) TECHNOLOGICAL INFORMATION.—The analysis 

14 required under subsection (a)(2) shall— 

15 ‘‘(1) review existing technological information 

16 and reports, including the most recent reports by the 

17 Department of Energy, the United States Global 

18 Change Research Program, the Intergovernmental 

19 Panel on Climate Change, and the International En20 ergy Agency and any other relevant information on 

21 technologies or practices that reduce or limit green22 house gas emissions; 

23 ‘‘(2) include the participation of technical ex24 perts from relevant private industry sectors; 


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1 ‘‘(3) review the current and future projected de2 ployment of technologies and practices in the United 

3 States that reduce or limit greenhouse gas emis4 sions, including— 

5 ‘‘(A) technologies for capture and seques6 tration of greenhouse gases; 

7 ‘‘(B) technologies to improve energy effi8 ciency; 

9 ‘‘(C) low- or zero-greenhouse gas emitting 

10 energy technologies; 

11 ‘‘(D) low- or zero-greenhouse gas emitting 

12 fuels; 

13 ‘‘(E) biological sequestration practices and 

14 technologies; and 

15 ‘‘(F) any other technologies the Academy 

16 deems relevant; and 

17 ‘‘(4) review and compare the emissions reduc18 tion potential, commercial viability, market penetra19 tion, investment trends, and deployment of the tech20 nologies described in paragraph (3), including— 

21 ‘‘(A) the need for additional research and 

22 development, including publicly funded research 

23 and development; 

24 ‘‘(B) the extent of commercial deployment, 

25 including, where appropriate, a comparison to 


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1 the cost and level of deployment of conventional 

2 fossil fuel-fired energy technologies and devices; 

3 and 

4 ‘‘(C) an evaluation of any substantial tech5 nological, legal, or market-based barriers to 

6 commercial deployment. 

7 ‘‘(d) RECOMMENDATIONS.— 

8 ‘‘(1) LATEST SCIENTIFIC INFORMATION.— 

9 Based on the review described in subsection (a)(1), 

10 the Academy shall identify actions that could be 

11 taken to— 

12 ‘‘(A) improve the characterization of 

13 changes in the earth-climate system and im14 pacts of global climate change; 

15 ‘‘(B) better inform decision making and 

16 actions related to global climate change; 

17 ‘‘(C) mitigate risks to natural and social 

18 systems; 

19 ‘‘(D) design policies to better account for 

20 climate risks; and 

21 ‘‘(E) improve the accuracy and reliability 

22 of capabilities to monitor, report, and verify 

23 greenhouse gas emissions reduction efforts. 


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1 ‘‘(2) TECHNOLOGICAL INFORMATION.—Based 

2 on the analysis described in subsection (a)(2), the 

3 Academy shall identify— 

4 ‘‘(A) additional emission reductions that 

5 may be possible as a result of technologies de6 scribed in the analysis; 

7 ‘‘(B) barriers to the deployment of such 

8 technologies; and 

9 ‘‘(C) actions that could be taken to speed 

10 deployment of such technologies. 

11 ‘‘(3) STATUS OF GREENHOUSE GAS REDUCTION

12 EFFORTS.—Based on the review described in sub13 section (a)(1), the Academy shall identify— 

14 ‘‘(A) the quantity of additional reductions 

15 required to meet the emissions reduction goals 

16 described in section 702; and 

17 ‘‘(B) the quantity of additional reductions 

18 in global greenhouse gas emissions needed to 

19 avoid the concentration and temperature 

20 thresholds described in section 705(c)(6)(A) or 

21 identified pursuant to section 705(c)(6)(B). 

22 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There 

23 are authorized to be appropriated to carry out this section 

24 such sums as may be necessary. 


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1 ‘‘SEC. 707. PRESIDENTIAL RESPONSE AND RECOMMENDA2 TIONS. 

3 ‘‘Not later than July 1, 2015, and every 4 years 

4 thereafter— 

5 ‘‘(1) the President shall direct relevant Federal 

6 agencies to use existing statutory authority to take 

7 appropriate actions identified in the reports sub8 mitted under sections 705 and 706 and to address 

9 any shortfalls identified in such reports; and 

10 ‘‘(2) in the event that the National Academy of 

11 Sciences has concluded, in the most recent report 

12 submitted under section 706, that the United States 

13 will not achieve the necessary domestic greenhouse 

14 gas emission reductions, or that global actions will 

15 not maintain safe global average surface tempera16 ture and atmospheric greenhouse gas concentration 

17 thresholds, the President shall submit to Congress a 

18 plan identifying domestic and international actions 

19 that will achieve necessary additional greenhouse gas 

20 reductions, including any recommendations for legis21 lative action. 

22 ‘‘PART B—DESIGNATION AND REGISTRATION OF 

23 GREENHOUSE GASES 

24 ‘‘SEC. 711. DESIGNATION OF GREENHOUSE GASES. 

25 ‘‘(a) GREENHOUSE GASES.—For purposes of this 

26 title, the following are greenhouse gases: 


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1 ‘‘(1) Carbon dioxide. 

2 ‘‘(2) Methane. 

3 ‘‘(3) Nitrous oxide. 

4 ‘‘(4) Sulfur hexafluoride. 

5 ‘‘(5) Hydrofluorocarbons from a chemical man6 ufacturing process at an industrial stationary 

7 source. 

8 ‘‘(6) Any perfluorocarbon, except as otherwise 

9 provided in section 714. 

10 ‘‘(7) Nitrogen trifluoride. 

11 ‘‘(8) Any other anthropogenic gas designated as 

12 a greenhouse gas by the Administrator under this 

13 section. 

14 ‘‘(b) DETERMINATION ON ADMINISTRATOR’S INITIA15 TIVE.—The Administrator shall, by rule— 

16 ‘‘(1) determine whether 1 metric ton of another 

17 anthropogenic gas makes the same or greater con18 tribution to global warming over 100 years as 1 met19 ric ton of carbon dioxide; 

20 ‘‘(2) determine the carbon dioxide equivalent 

21 value for each gas with respect to which the Admin22 istrator makes an affirmative determination under 

23 paragraph (1); 

24 ‘‘(3) for each gas with respect to which the Ad25 ministrator makes an affirmative determination 


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1 under paragraph (1) and that is used as a substitute 

2 for a class I or class II substance under title VI, de3 termine the extent to which to regulate that gas 

4 under section 619 and specify appropriate compli5 ance obligations under section 619; 

6 ‘‘(4) designate as a greenhouse gas for purposes 

7 of this title each gas for which the Administrator 

8 makes an affirmative determination under para9 graph (1), to the extent that it is not regulated 

10 under section 619; and 

11 ‘‘(5) specify the appropriate compliance obliga12 tions under this title for each gas designated as a 

13 greenhouse gas under paragraph (4). 

14 ‘‘(c) PETITIONS TO DESIGNATE A GREENHOUSE

15 GAS.— 

16 ‘‘(1) IN GENERAL.—Any person may petition 

17 the Administrator to designate as a greenhouse gas 

18 any anthropogenic gas 1 metric ton of which makes 

19 the same or greater contribution to global warming 

20 over 100 years as 1 metric ton of carbon dioxide. 

21 ‘‘(2) CONTENTS OF PETITION.—The petitioner 

22 shall provide sufficient data, as specified by rule by 

23 the Administrator, to demonstrate that the gas is 

24 likely to be a greenhouse gas and is likely to be pro25 duced, imported, used, or emitted in the United 


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1 States. To the extent practicable, the petitioner shall 

2 also identify producers, importers, distributors, 

3 users, and emitters of the gas in the United States. 

4 ‘‘(3) REVIEW AND ACTION BY THE ADMINIS5 TRATOR.—Not later than 90 days after receipt of a 

6 petition under paragraph (2), the Administrator 

7 shall determine whether the petition is complete and 

8 notify the petitioner and the public of the decision. 

9 ‘‘(4) ADDITIONAL INFORMATION.—The Admin10 istrator may require producers, importers, distribu11 tors, users, or emitters of the gas to provide infor12 mation on the contribution of the gas to global 

13 warming over 100 years compared to carbon dioxide. 

14 ‘‘(5) TREATMENT OF PETITION.—For any sub15 stance used as a substitute for a class I or class II 

16 substance under title VI, the Administrator may 

17 elect to treat a petition under this subsection as a 

18 petition to list the substance as a class II, group II 

19 substance under section 619, and may require the 

20 petition to be amended to address listing criteria 

21 promulgated under that section. 

22 ‘‘(6) DETERMINATION.—Not later than 2 years 

23 after receipt of a complete petition, the Adminis24 trator shall, after notice and an opportunity for com25 ment— 


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1 ‘‘(A) issue and publish in the Federal Reg2 ister— 

3 ‘‘(i) a determination that 1 metric ton 

4 of the gas does not make a contribution to 

5 global warming over 100 years that is 

6 equal to or greater than that made by 1 

7 metric ton of carbon dioxide; and 

8 ‘‘(ii) an explanation of the decision; or 

9 ‘‘(B) determine that 1 metric ton of the 

10 gas makes a contribution to global warming 

11 over 100 years that is equal to or greater than 

12 that made by 1 metric ton of carbon dioxide, 

13 and take the actions described in subsection (b) 

14 with respect to such gas. 

15 ‘‘(7) GROUNDS FOR DENIAL.—The Adminis16 trator may not deny a petition under this subsection 

17 solely on the basis of inadequate Environmental Pro18 tection Agency resources or time for review. 

19 ‘‘(d) SCIENCE ADVISORY BOARD CONSULTATION.— 

20 ‘‘(1) CONSULTATION.—The Administrator 

21 shall— 

22 ‘‘(A) give notice to the Science Advisory 

23 Board prior to making a determination under 

24 subsection (b)(1), (c)(6), or (e)(2)(B); 


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1 ‘‘(B) consider the written recommendations 

2 of the Science Advisory Board under paragraph 

3 (2) regarding the determination; and 

4 ‘‘(C) consult with the Science Advisory 

5 Board regarding such determination, including 

6 consultation subsequent to receipt of such writ7 ten recommendations. 

8 ‘‘(2) FORMULATION OF RECOMMENDATIONS.— 

9 Upon receipt of notice under paragraph (1)(A) re10 garding a pending determination under subsection 

11 (b)(1), (c)(6), or (e)(2)(B), the Science Advisory 

12 Board shall— 

13 ‘‘(A) formulate recommendations regarding 

14 such determination, subject to a peer review 

15 process; and 

16 ‘‘(B) submit such recommendations in 

17 writing to the Administrator. 

18 ‘‘(e) MANUFACTURING AND EMISSION NOTICES.— 

19 ‘‘(1) NOTICE REQUIREMENT.— 

20 ‘‘(A) IN GENERAL.—Except as otherwise 

21 provided in section 714, effective 24 months 

22 after the date of enactment of this title, no per23 son may manufacture or introduce into inter24 state commerce a fluorinated gas, or emit a sig25 nificant quantity, as determined by the AdminVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00406 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 istrator, of any fluorinated gas that is gen2 erated as a byproduct during the production or 

3 use of another fluorinated gas, unless— 

4 ‘‘(i) the gas is designated as a green5 house gas under this section or is an 

6 ozone-depleting substance listed as a class 

7 I or class II substance under title VI; 

8 ‘‘(ii) the Administrator has deter9 mined that 1 metric ton of such gas does 

10 not make a contribution to global warming 

11 that is equal to or greater than that made 

12 by 1 metric ton of carbon dioxide; or 

13 ‘‘(iii) the person manufacturing or im14 porting the gas for distribution into inter15 state commerce, or emitting the gas, has 

16 submitted to the Administrator, at least 90 

17 days before the start of such manufacture, 

18 introduction into commerce, or emission, a 

19 notice of such person’s manufacture, intro20 duction into commerce, or emission of such 

21 gas, and the Administrator has not deter22 mined that notice or a substantially similar 

23 notice is incomplete. 

24 ‘‘(B) ALTERNATIVE COMPLIANCE.—For a 

25 gas that is a substitute for a class I or class II 


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1 substance under title VI and either has been 

2 listed as acceptable for use under section 612 

3 or is currently subject to evaluation under sec4 tion 612, the Administrator may accept the no5 tice and information provided pursuant to that 

6 section as fulfilling the obligation under clause 

7 (iii) of subparagraph (A). 

8 ‘‘(2) REVIEW AND ACTION BY THE ADMINIS9 TRATOR.— 

10 ‘‘(A) COMPLETENESS.—Not later than 90 

11 days after receipt of notice under paragraph 

12 (1)(A)(iii) or (B), the Administrator shall deter13 mine whether the notice is complete. 

14 ‘‘(B) DETERMINATION.—If the Adminis15 trator determines that the notice is complete, 

16 the Administrator shall, after notice and an op17 portunity for comment, not later than 12 

18 months after receipt of the notice— 

19 ‘‘(i) issue and publish in the Federal 

20 Register a determination that 1 metric ton 

21 of the gas does not make a contribution to 

22 global warming over 100 years that is 

23 equal to or greater than that made by 1 

24 metric ton of carbon dioxide and an expla25 nation of the decision; or 


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1 ‘‘(ii) determine that 1 metric ton of 

2 the gas makes a contribution to global 

3 warming over 100 years that is equal to or 

4 greater than that made by 1 metric ton of 

5 carbon dioxide, and take the actions de6 scribed in subsection (b) with respect to 

7 such gas. 

8 ‘‘(f) REGULATIONS.—Not later than one year after 

9 the date of enactment of this title, the Administrator shall 

10 promulgate regulations to carry out this section. Such reg11 ulations shall include— 

12 ‘‘(1) requirements for the contents of a petition 

13 submitted under subsection (c); 

14 ‘‘(2) requirements for the contents of a notice 

15 required under subsection (e); and 

16 ‘‘(3) methods and standards for evaluating the 

17 carbon dioxide equivalent value of a gas. 

18 ‘‘(g) GASES REGULATED UNDER TITLE VI.—The 

19 Administrator shall not designate a gas as a greenhouse 

20 gas under this section to the extent that the gas is regu21 lated under title VI. 

22 ‘‘(h) SAVINGS CLAUSE.—Nothing in this section shall 

23 be interpreted to relieve any person from complying with 

24 the requirements of section 612. 


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1 ‘‘SEC. 712. CARBON DIOXIDE EQUIVALENT VALUE OF 

2 GREENHOUSE GASES. 

3 ‘‘(a) MEASURE OF QUANTITY OF GREENHOUSE

4 GASES.—Any provision of this title or title VIII that refers 

5 to a quantity or percentage of a quantity of greenhouse 

6 gases shall mean the quantity or percentage of the green7 house gases expressed in carbon dioxide equivalents. 

8 ‘‘(b) INITIAL VALUE.—Except as provided by the Ad9 ministrator under this section or section 711— 

10 ‘‘(1) the carbon dioxide equivalent value of 

11 greenhouse gases for purposes of this Act shall be as 

12 follows: 

‘‘ CARBON DIOXIDE EQUIVALENT OF 1 TON OF LISTED 

GREENHOUSE GASES 

Greenhouse gas (1 metric ton) Carbon dioxide equivalent 

(metric tons) 

Carbon dioxide 1 

Methane 25 

Nitrous oxide 298 

HFC-23 14,800 

HFC-125 3,500 

HFC-134a 1,430 

HFC-143a 4,470 

HFC-152a 124 

HFC-227ea 3,220 

HFC-236fa 9,810 

HFC-4310mee 1,640 

CF4 7,390 


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‘‘ CARBON DIOXIDE EQUIVALENT OF 1 TON OF LISTED 

GREENHOUSE GASES—Continued 

Greenhouse gas (1 metric ton) Carbon dioxide equivalent 

(metric tons) 

C2F6 12,200 

C4F10 8,860 

C6F14 9,300 

SF6 22,800 

NF3 17,200 

1 ; and 

2 ‘‘(2) the carbon dioxide equivalent value for 

3 purposes of this Act for any greenhouse gas not list4 ed in the table under paragraph (1) shall be the 

5 100-year Global Warming Potentials provided in the 

6 Intergovernmental Panel on Climate Change Fourth 

7 Assessment Report. 

8 ‘‘(c) PERIODIC REVIEW.— 

9 ‘‘(1) Not later than February 1, 2017, and (ex10 cept as provided in paragraph (3)) not less than 

11 every 5 years thereafter, the Administrator shall— 

12 ‘‘(A) review and, if appropriate, revise the 

13 carbon dioxide equivalent values established 

14 under this section or section 711(b)(2), based 

15 on a determination of the number of metric 

16 tons of carbon dioxide that makes the same 

17 contribution to global warming over 100 years 

18 as 1 metric ton of each greenhouse gas; and 


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1 ‘‘(B) publish in the Federal Register the 

2 results of that review and any revisions. 

3 ‘‘(2) A revised determination published in the 

4 Federal Register under paragraph (1)(B) shall take 

5 effect for greenhouse gas emissions starting on Jan6 uary 1 of the first calendar year starting at least 9 

7 months after the date on which the revised deter8 mination was published. 

9 ‘‘(3) The Administrator may decrease the fre10 quency of review and revision under paragraph (1) 

11 if the Administrator determines that such decrease 

12 is appropriate in order to synchronize such review 

13 and revision with any similar review process carried 

14 out pursuant to the United Nations Framework 

15 Convention on Climate Change, done at New York 

16 on May 9, 1992, or to an agreement negotiated 

17 under that convention, except that in no event shall 

18 the Administrator carry out such review and revision 

19 any less frequently than every 10 years. 

20 ‘‘(d) METHODOLOGY.—In setting carbon dioxide 

21 equivalent values, for purposes of this section or section 

22 711, the Administrator shall take into account publica23 tions by the Intergovernmental Panel on Climate Change 

24 or a successor organization under the auspices of the 


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1 United Nations Environmental Programme and the World 

2 Meteorological Organization. 

3 ‘‘SEC. 713. GREENHOUSE GAS REGISTRY. 

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

5 ‘‘(1) CLIMATE REGISTRY.—The term ‘Climate 

6 Registry’ means the greenhouse gas emissions reg7 istry jointly established and managed by more than 

8 40 States and Indian tribes in 2007 to collect high9 quality greenhouse gas emission data from facilities, 

10 corporations, and other organizations to support var11 ious greenhouse gas emission reporting and reduc12 tion policies for the member States and Indian 

13 tribes. 

14 ‘‘(2) REPORTING ENTITY.—The term ‘reporting 

15 entity’ means— 

16 ‘‘(A) a covered entity; 

17 ‘‘(B) an entity that— 

18 ‘‘(i) would be a covered entity if it had 

19 emitted, produced, imported, manufac20 tured, or delivered in 2008 or any subse21 quent year more than the applicable 

22 threshold level in the definition of covered 

23 entity in paragraph (13) of section 700; 

24 and 


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1 ‘‘(ii) has emitted, produced, imported, 

2 manufactured, or delivered in 2008 or any 

3 subsequent year more than the applicable 

4 threshold level in the definition of covered 

5 entity in paragraph (13) of section 700, 

6 provided that the figure of 25,000 tons of 

7 carbon dioxide equivalent is read instead 

8 as 10,000 tons of carbon dioxide equivalent 

9 and the figure of 460,000,000 cubic feet is 

10 read instead as 184,000,000 cubic feet; 

11 ‘‘(C) any other entity that emits a green12 house gas, or produces, imports, manufactures, 

13 or delivers material whose use results or may 

14 result in greenhouse gas emissions if the Ad15 ministrator determines that reporting under 

16 this section by such entity will help achieve the 

17 purposes of this title or title VIII; 

18 ‘‘(D) any vehicle fleet with emissions of 

19 more than 25,000 tons of carbon dioxide equiv20 alent on an annual basis, if the Administrator 

21 determines that the inclusion of such fleet will 

22 help achieve the purposes of this title or title 

23 VIII; or 

24 ‘‘(E) any entity that delivers electricity to 

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1 tor that meets the energy or greenhouse gas in2 tensity criteria in section 764(b)(3)(B)(i). 

3 ‘‘(b) REGULATIONS.— 

4 ‘‘(1) IN GENERAL.—Not later than 6 months 

5 after the date of enactment of this title, the Admin6 istrator shall issue regulations establishing a Federal 

7 greenhouse gas registry. Such regulations shall— 

8 ‘‘(A) require reporting entities to submit to 

9 the Administrator data on— 

10 ‘‘(i) greenhouse gas emissions in the 

11 United States; 

12 ‘‘(ii) the production and manufacture 

13 in the United States, importation into the 

14 United States, and, at the discretion of the 

15 Administrator, exportation from the 

16 United States, of fuels and industrial gases 

17 the uses of which result or may result in 

18 greenhouse gas emissions; 

19 ‘‘(iii) deliveries in the United States of 

20 natural gas, and any other gas meeting the 

21 specifications for commingling with natural 

22 gas for purposes of delivery, the combus23 tion of which result or may result in green24 house gas emissions; and 


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1 ‘‘(iv) the capture and sequestration of 

2 greenhouse gases; 

3 ‘‘(B) require covered entities and, where 

4 appropriate, other reporting entities to submit 

5 to the Administrator data sufficient to ensure 

6 compliance with or implementation of the re7 quirements of this title; 

8 ‘‘(C) require reporting of electricity deliv9 ered to industrial sources in energy-intensive in10 dustries; 

11 ‘‘(D) ensure the completeness, consistency, 

12 transparency, accuracy, precision, and reliability 

13 of such data; 

14 ‘‘(E) take into account the best practices 

15 from the most recent Federal, State, tribal, and 

16 international protocols for the measurement, ac17 counting, reporting, and verification of green18 house gas emissions, including protocols from 

19 the Climate Registry and other mandatory 

20 State or multistate authorized programs; 

21 ‘‘(F) take into account the latest scientific 

22 research; 

23 ‘‘(G) require that, for covered entities with 

24 respect to greenhouse gases to which section 

25 722 applies, and, to the extent determined to be 


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1 appropriate by the Administrator, for covered 

2 entities with respect to other greenhouse gases 

3 and for other reporting entities, submitted data 

4 are based on— 

5 ‘‘(i) continuous monitoring systems 

6 for fuel flow or emissions, such as contin7 uous emission monitoring systems; 

8 ‘‘(ii) alternative systems that are dem9 onstrated as providing data with the same 

10 precision, reliability, accessibility, and 

11 timeliness, or, to the extent the Adminis12 trator determines is appropriate for report13 ing small amounts of emissions, the same 

14 precision, reliability, and accessibility and 

15 similar timeliness, as data provided by con16 tinuous monitoring systems for fuel flow or 

17 emissions; or 

18 ‘‘(iii) alternative methodologies that 

19 are demonstrated to provide data with pre20 cision, reliability, accessibility, and timeli21 ness, or, to the extent the Administrator 

22 determines is appropriate for reporting 

23 small amounts of emissions, precision, reli24 ability, and accessibility, as similar as is 

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1 erally provided by continuous monitoring 

2 systems for fuel flow or emissions, if the 

3 Administrator determines that, with re4 spect to a reporting entity, there is no con5 tinuous monitoring system or alternative 

6 system described in clause (i) or (ii) that 

7 is technically feasible; 

8 ‘‘(H) require that the Administrator, in de9 termining the extent to which the requirement 

10 to use systems or methodologies in accordance 

11 with subparagraph (G) is appropriate for re12 porting entities other than covered entities or 

13 for greenhouse gases to which section 722 does 

14 not apply, consider the cost of using such sys15 tems and methodologies, and of using other sys16 tems and methodologies that are available and 

17 suitable, for quantifying the emissions involved 

18 in light of the purposes of this title, including 

19 the goal of collecting consistent entity-wide 

20 data; 

21 ‘‘(I) include methods for minimizing double 

22 reporting and avoiding irreconcilable double re23 porting of greenhouse gas emissions; 

24 ‘‘(J) establish measurement protocols for 

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1 ing into consideration the regulations promul2 gated under section 813; 

3 ‘‘(K) require that reporting entities provide 

4 the data required under this paragraph in re5 ports submitted electronically to the Adminis6 trator, in such form and containing such infor7 mation as may be required by the Adminis8 trator; 

9 ‘‘(L) include requirements for keeping 

10 records supporting or related to, and protocols 

11 for auditing, submitted data; 

12 ‘‘(M) establish consistent policies for calcu13 lating carbon content and greenhouse gas emis14 sions for each type of fossil fuel with respect to 

15 which reporting is required; 

16 ‘‘(N) subsequent to implementation of poli17 cies developed under subparagraph (M), provide 

18 for immediate dissemination, to States, Indian 

19 tribes, and on the Internet, of all data reported 

20 under this section as soon as practicable after 

21 electronic audit by the Administrator and any 

22 resulting correction of data, except that data 

23 shall not be disseminated under this subpara24 graph if— 


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1 ‘‘(i) its nondissemination is vital to 

2 the national security of the United States, 

3 as determined by the President; or 

4 ‘‘(ii) it is confidential business infor5 mation that cannot be derived from infor6 mation that is otherwise publicly available 

7 and that would cause significant calculable 

8 competitive harm if published, except 

9 that— 

10 ‘‘(I) data relating to greenhouse 

11 gas emissions, including any upstream 

12 or verification data from reporting en13 tities, shall not be considered to be 

14 confidential business information; and 

15 ‘‘(II) data that is confidential 

16 business information shall be provided 

17 to a State or Indian tribe within 

18 whose jurisdiction the reporting entity 

19 is located, if the Administrator deter20 mines that such State or Indian tribe 

21 has in effect protections for confiden22 tial business information that are 

23 equivalent to protections applicable to 

24 the Federal Government; 


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1 ‘‘(O) prescribe methods by which the Ad2 ministrator shall, in cases in which satisfactory 

3 data are not submitted to the Administrator for 

4 any period of time, estimate emission, produc5 tion, importation, manufacture, or delivery lev6 els— 

7 ‘‘(i) for covered entities with respect 

8 to greenhouse gas emissions, production, 

9 importation, manufacture, or delivery regu10 lated under this title to ensure that emis11 sions, production, importation, manufac12 ture, or deliveries are not underreported, 

13 and to create a strong incentive for meet14 ing data monitoring and reporting require15 ments— 

16 ‘‘(I) with a conservative estimate 

17 of the highest emission, production, 

18 importation, manufacture, or delivery 

19 levels that may have occurred during 

20 the period for which data are missing; 

21 or 

22 ‘‘(II) to the extent the Adminis23 trator considers appropriate, with an 

24 estimate of such levels assuming the 

25 unit is emitting, producing, importing, 


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1 manufacturing, or delivering at a 

2 maximum potential level during the 

3 period, in order to ensure that such 

4 levels are not underreported and to 

5 create a strong incentive for meeting 

6 data monitoring and reporting re7 quirements; and 

8 ‘‘(ii) for covered entities with respect 

9 to greenhouse gas emissions to which sec10 tion 722 does not apply and for other re11 porting entities, with a reasonable estimate 

12 of the emission, production, importation, 

13 manufacture, or delivery levels that may 

14 have occurred during the period for which 

15 data are missing; 

16 ‘‘(P) require the designation of a des17 ignated representative for each reporting entity; 

18 ‘‘(Q) require an appropriate certification, 

19 by the designated representative for the report20 ing entity, of accurate and complete accounting 

21 of greenhouse gas emissions, as determined by 

22 the Administrator; and 

23 ‘‘(R) include requirements for other data 

24 necessary for accurate and complete accounting 

25 of greenhouse gas emissions, as determined by 


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1 the Administrator, including data for quality 

2 assurance of monitoring systems, monitors and 

3 other measurement devices, and other data 

4 needed to verify reported emissions, production, 

5 importation, manufacture, or delivery. 

6 ‘‘(2) TIMING.— 

7 ‘‘(A) CALENDAR YEARS 2007 THROUGH

8 2010.—For a base period of calendar years 

9 2007 through 2010, each reporting entity shall 

10 submit annual data required under this section 

11 to the Administrator not later than March 31, 

12 2011. The Administrator may waive or modify 

13 reporting requirements for calendar years 2007 

14 through 2010 for categories of reporting enti15 ties to the extent that the Administrator deter16 mines that the reporting entities did not keep 

17 data or records necessary to meet reporting re18 quirements. The Administrator may, in addition 

19 to or in lieu of such requirements, collect infor20 mation on energy consumption and production. 

21 ‘‘(B) SUBSEQUENT CALENDAR YEARS.— 

22 For calendar year 2011 and each subsequent 

23 calendar year, each reporting entity shall sub24 mit quarterly data required under this section 

25 to the Administrator not later than 60 days 


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1 after the end of the applicable quarter, except 

2 when the data is already being reported to the 

3 Administrator on an earlier timeframe for an4 other program. 

5 ‘‘(3) WAIVER OF REPORTING REQUIREMENTS.— 

6 The Administrator may waive reporting require7 ments under this section for specific entities to the 

8 extent that the Administrator determines that suffi9 cient and equally or more reliable verified and timely 

10 data are available to the Administrator and the pub11 lic on the Internet under other mandatory statutory 

12 requirements. 

13 ‘‘(4) ALTERNATIVE THRESHOLD.—The Admin14 istrator may, by rule, establish applicability thresh15 olds for reporting under this section using alter16 native metrics and levels, provided that such metrics 

17 and levels are easier to administer and cover the 

18 same size and type of sources as the threshold de19 fined in this section. 

20 ‘‘(c) INTERRELATIONSHIP WITH OTHER SYSTEMS.— 

21 In developing the regulations issued under subsection (b), 

22 the Administrator shall take into account the work done 

23 by the Climate Registry and other mandatory State or 

24 multistate programs. Such regulations shall include an ex25 planation of any major differences in approach between 


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1 the system established under the regulations and such reg2 istries and programs. 

3 ‘‘SEC. 714. PERFLUOROCARBON REGULATION. 

4 ‘‘(a) DEFINITIONS.—In this section: 

5 ‘‘(1) CONSUMPTION.—The term ‘consumption’ 

6 means, with respect to perfluorocarbon, the quantity 

7 of that substance produced in the United States, 

8 plus the quantity imported, minus the quantity ex9 ported. 

10 ‘‘(2) PRODUCE; PRODUCED; PRODUCTION.— 

11 ‘‘(A) IN GENERAL.—The terms ‘produce’, 

12 ‘produced’, and ‘production’ mean the manufac13 ture of perfluorocarbon, or the emission of 

14 perfluorocarbon from other industrial sources. 

15 ‘‘(B) EXCLUSIONS.—The terms ‘produce’, 

16 ‘produced’, and ‘production’ do not include— 

17 ‘‘(i) the manufacture of 

18 perfluorocarbon that is used and entirely 

19 consumed (except for trace quantities) in 

20 the manufacture of other chemicals or 

21 products; 

22 ‘‘(ii) the reuse or recycling of 

23 perfluorocarbon; or 


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1 ‘‘(iii) the emission of perfluorocarbon 

2 from use in production processes, such as 

3 electronics manufacturing. 

4 ‘‘(C) OFFSET CREDIT.—The term ‘offset 

5 credit’ means reduction of perfluorocarbon 

6 emissions by destruction or conversionary use of 

7 perfluorocarbons during production processes, 

8 such as electronics manufacturing. 

9 ‘‘(b) DETERMINATION BY ADMINISTRATOR.—As soon 

10 as practicable after the date of enactment of this section, 

11 the Administrator shall determine, based on such criteria 

12 as the Administrator determines to be appropriate, wheth13 er emissions from the production and consumption of 

14 perfluorocarbon should be regulated in accordance with— 

15 ‘‘(1) this section; or 

16 ‘‘(2) the other applicable provisions of this title. 

17 ‘‘(c) EFFECT OF DETERMINATION.—On a determina18 tion by the Administrator under subsection (a)(1) that 

19 perfluorocarbon emissions described in subsection (b) 

20 should be regulated in accordance with this section— 

21 ‘‘(1) emissions from the production of 

22 perfluorocarbon shall be subject to the best available 

23 control technology (as defined in section 169) for 

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1 cilities emitting 25,000 metric tons of carbon dioxide 

2 equivalent perfluorocarbon emissions or more; and 

3 ‘‘(2) the consumption of perfluorocarbon shall 

4 be phased down in accordance with this section. 

5 ‘‘(d) USE AND CONSUMPTION.— 

6 ‘‘(1) PHASE-DOWNS.— 

7 ‘‘(A) CONSUMPTION.— 

8 ‘‘(i) IN GENERAL.—With respect to 

9 perfluorocarbon, not later than 18 months 

10 after the date of enactment of this section, 

11 the Administrator shall promulgate regula12 tions phasing down, in accordance with 

13 this section— 

14 ‘‘(I) the consumption of 

15 perfluorocarbon in the United States; 

16 and 

17 ‘‘(II) the importation into the 

18 United States of products containing 

19 any perfluorocarbon. 

20 ‘‘(ii) PROHIBITION.—Effective begin21 ning on January 1, 2014, it shall be un22 lawful for any person to produce any per23 fluorocarbon, import any perfluorocarbon, 

24 or import any product containing 

25 perfluorocarbon, unless the person holds 1 


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1 consumption allowance or 1 offset credit 

2 for each carbon dioxide equivalent ton of 

3 the perfluorocarbon destroyed. 

4 ‘‘(iii) RETIRED ALLOWANCES.—Any 

5 person who exports a perfluorocarbon for 

6 which a use allowance was retired may re7 ceive a refund of that allowance from the 

8 Administrator after the date of export. 

9 ‘‘(B) INTEGRITY OF LIMITS.—To maintain 

10 the integrity of the perfluorocarbon limits under 

11 this paragraph, the Administrator may limit, by 

12 regulation, the percentage of the compliance ob13 ligation of any person that may be met through 

14 the consumption of offset credits or banked al15 lowances. 

16 ‘‘(C) COUNTING OF VIOLATIONS.—Each 

17 consumption allowance or offset credit not held 

18 as required by this subsection shall be a sepa19 rate violation of this section. 

20 ‘‘(2) SCHEDULE.—Pursuant to the regulations 

21 promulgated under paragraph (1)(A), the number of 

22 perfluorocarbon consumption allowances available for 

23 distribution for each calendar year beginning in cal24 endar year 2014 shall be established by the Adminis25 trator. 


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1 ‘‘(3) BASELINE.— 

2 ‘‘(A) IN GENERAL.—Not later than 1 year 

3 after the date of enactment of this section, the 

4 Administrator shall promulgate regulations to 

5 establish the baseline for purposes of paragraph 

6 (2). 

7 ‘‘(B) CALCULATION.—The baseline shall 

8 be— 

9 ‘‘(i) the sum, expressed in metric tons 

10 of carbon dioxide equivalents, of— 

11 ‘‘(I) the average of the annual 

12 consumption of all perfluorocarbon in 

13 each of calendar years 2004, 2005, 

14 and 2006; and 

15 ‘‘(II) the annual average quantity 

16 of all perfluorocarbon contained in im17 ported products during the period of 

18 calendar years 2004, 2005, and 2006; 

19 or 

20 ‘‘(ii) such alternative quantity of car21 bon dioxide equivalents that, as determined 

22 by the Administrator, more accurately re23 flects the average annual quantity of 

24 perfluorocarbon consumed in and imported 

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1 ucts), as based on information compiled by 

2 the Administrator. 

3 ‘‘(4) DISTRIBUTION OF ALLOWANCES.—The 

4 Administrator shall determine an allocation, and 

5 procedures for the distribution, transfer, and ex6 change of allowances for the consumption of 

7 perfluorocarbon under this section, including a de8 termination of whether allowances may be auctioned, 

9 sold, or allocated and distributed at no cost, trans10 ferred, or exchanged for domestic or international 

11 consumption, in accordance with such criteria as the 

12 Administrator considers to be appropriate. 

13 ‘‘(e) IMPLEMENTATION.—To the maximum extent 

14 practicable, the Administrator shall implement this section 

15 in accordance with the procedures described in section 

16 619. 

17 ‘‘(f) DEADLINES FOR COMPLIANCE.—The Adminis18 trator shall promulgate regulations for perfluorocarbon in 

19 accordance with this section by not later than October 31, 

20 2013. 

21 ‘‘PART C—PROGRAM RULES 

22 ‘‘SEC. 721. EMISSION ALLOWANCES. 

23 ‘‘(a) IN GENERAL.—The Administrator shall estab24 lish a separate quantity of emission allowances for each 


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1 calendar year starting in 2012, in the amounts prescribed 

2 under subsection (e). 

3 ‘‘(b) IDENTIFICATION NUMBERS.—The Adminis4 trator shall assign to each emission allowance established 

5 under subsection (a) a unique identification number that 

6 includes the vintage year for that emission allowance. 

7 ‘‘(c) LEGAL STATUS OF EMISSION ALLOWANCES.— 

8 ‘‘(1) IN GENERAL.—An allowance established 

9 by the Administrator under this title does not con10 stitute a property right. 

11 ‘‘(2) TERMINATION OR LIMITATION.—Nothing 

12 in this Act or any other provision of law shall be 

13 construed to limit or alter the authority of the 

14 United States, including the Administrator acting 

15 pursuant to statutory authority, to terminate or 

16 limit allowances, offset credits, or term offset cred17 its. 

18 ‘‘(3) OTHER PROVISIONS UNAFFECTED.—Ex19 cept as otherwise specified in this Act, nothing in 

20 this Act relating to allowances, offset credits, or 

21 term offset credits established or issued under this 

22 title shall affect the application of any other provi23 sion of law to a covered entity, or the responsibility 

24 for a covered entity to comply with any such provi25 sion of law. 


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1 ‘‘(d) SAVINGS PROVISION.—Nothing in this part shall 

2 be construed as requiring a change of any kind in any 

3 State law regulating electric utility rates and charges, or 

4 as affecting any State law regarding such State regula5 tion, or as limiting State regulation (including any 

6 prudency review) under such a State law. Nothing in this 

7 part shall be construed as modifying the Federal Power 

8 Act (16 U.S.C. 791a et seq.) or as affecting the authority 

9 of the Federal Energy Regulatory Commission under that 

10 Act. Nothing in this part shall be construed to interfere 

11 with or impair any program for competitive bidding for 

12 power supply in a State in which such program is estab13 lished. 

14 ‘‘(e) ALLOWANCES FOR EACH CALENDAR YEAR.— 

15 ‘‘(1) IN GENERAL.—Except as provided in para16 graph (2), the number of emission allowances estab17 lished by the Administrator under subsection (a) for 

18 each calendar year shall be as provided in the fol19 lowing table: 

‘‘Calendar Year Emissions Allowances (MtCO2e) 

2012 ....................................................................... 4,627 

2013 ....................................................................... 4,544 

2014 ....................................................................... 5,099 

2015 ....................................................................... 5,003 

2016 ....................................................................... 5,482 

2017 ....................................................................... 5,261 

2018 ....................................................................... 5,132 

2019 ....................................................................... 5,002 

2020 ....................................................................... 4,873 

2021 ....................................................................... 4,739 

2022 ....................................................................... 4,605 

2023 ....................................................................... 4,471 


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2024 ....................................................................... 4,337 

2025 ....................................................................... 4,203 

2026 ....................................................................... 4,069 

2027 ....................................................................... 3,935 

2028 ....................................................................... 3,801 

2029 ....................................................................... 3,667 

2030 ....................................................................... 3,533 

2031 ....................................................................... 3,408 

2032 ....................................................................... 3,283 

2033 ....................................................................... 3,158 

2034 ....................................................................... 3,033 

2035 ....................................................................... 2,908 

2036 ....................................................................... 2,784 

2037 ....................................................................... 2,659 

2038 ....................................................................... 2,534 

2039 ....................................................................... 2,409 

2040 ....................................................................... 2,284 

2041 ....................................................................... 2,159 

2042 ....................................................................... 2,034 

2043 ....................................................................... 1,910 

2044 ....................................................................... 1,785 

2045 ....................................................................... 1,660 

2046 ....................................................................... 1,535 

2047 ....................................................................... 1,410 

2048 ....................................................................... 1,285 

2049 ....................................................................... 1,160 

2050 ....................................................................... 1,035 

1 ‘‘(2) REVISION.— 

2 ‘‘(A) IN GENERAL.—The Administrator 

3 may adjust, in accordance with subparagraph 

4 (B), the number of emission allowances estab5 lished pursuant to paragraph (1) if, after notice 

6 and an opportunity for public comment, the Ad7 ministrator determines that— 

8 ‘‘(i) United States greenhouse gas 

9 emissions in 2005 were other than 7,206 

10 million metric tons carbon dioxide equiva11 lent; 

12 ‘‘(ii) if the requirements of this title 

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1 tion 722 would have required emission al2 lowances to be held for other than 66.2 

3 percent of United States greenhouse gas 

4 emissions in 2005; 

5 ‘‘(iii) if the requirements of this title 

6 for 2014 had been in effect in 2005, sec7 tion 722 would have required emission al8 lowances to be held for other than 75.7 

9 percent of United States greenhouse gas 

10 emissions in 2005; or 

11 ‘‘(iv) if the requirements of this title 

12 for 2016 had been in effect in 2005, sec13 tion 722 would have required emission al14 lowances to be held for other than 84.5 

15 percent United States greenhouse gas 

16 emissions in 2005. 

17 ‘‘(B) ADJUSTMENT FORMULA.— 

18 ‘‘(i) IN GENERAL.—If the Adminis19 trator adjusts under this paragraph the 

20 number of emission allowances established 

21 pursuant to paragraph (1), the number of 

22 emission allowances the Administrator es23 tablishes for any given calendar year shall 

24 equal the product of— 


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1 ‘‘(I) United States greenhouse 

2 gas emissions in 2005, expressed in 

3 tons of carbon dioxide equivalent; 

4 ‘‘(II) the percent of United 

5 States greenhouse gas emissions in 

6 2005, expressed in tons of carbon di7 oxide equivalent, that would have been 

8 subject to section 722 if the require9 ments of this title for the given cal10 endar year had been in effect in 2005; 

11 and 

12 ‘‘(III) the percentage set forth 

13 for that calendar year in section 

14 703(a), or determined under clause 

15 (ii) of this subparagraph. 

16 ‘‘(ii) TARGETS.—In applying the por17 tion of the formula in clause (i)(III) of this 

18 subparagraph, for calendar years for which 

19 a percentage is not listed in section 703(a), 

20 the Administrator shall use a uniform an21 nual decline in the amount of emissions be22 tween the years that are specified. 

23 ‘‘(iii) CARBON DIOXIDE EQUIVALENT

24 VALUE.—If the Administrator adjusts 

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1 sion allowances established pursuant to 

2 paragraph (1), the Administrator shall use 

3 the carbon dioxide equivalent values estab4 lished pursuant to section 712. 

5 ‘‘(iv) LIMITATION ON ADJUSTMENT

6 TIMING.—Once a calendar year has start7 ed, the Administrator may not adjust the 

8 number of emission allowances to be estab9 lished for that calendar year. 

10 ‘‘(C) LIMITATION ON ADJUSTMENT AU11 THORITY.—The Administrator may adjust 

12 under this paragraph the number of emission 

13 allowances to be established pursuant to para14 graph (1) only once. 

15 ‘‘(f) COMPENSATORY ALLOWANCE.— 

16 ‘‘(1) IN GENERAL.—The regulations promul17 gated under subsection (h) shall provide for the es18 tablishment and distribution of compensatory allow19 ances for— 

20 ‘‘(A) the destruction, in 2012 or later, of 

21 fluorinated gases that are greenhouse gases if— 

22 ‘‘(i) allowances or offset credits were 

23 retired for their production or importation; 

24 and 


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1 ‘‘(ii) such gases are not required to be 

2 destroyed under any other provision of law; 

3 ‘‘(B) the nonemissive use, in 2012 or later, 

4 of petroleum-based or coal-based liquid or gas5 eous fuel, petroleum coke, natural gas liquid, or 

6 natural gas as a feedstock, if allowances or off7 set credits were retired for the greenhouse 

8 gases that would have been emitted from their 

9 combustion; and 

10 ‘‘(C) the conversionary use, in 2012 or 

11 later, of fluorinated gases in a manufacturing 

12 process, including semiconductor research or 

13 manufacturing, if allowances or offset credits 

14 were retired for the production or importation 

15 of such gas. 

16 ‘‘(2) ESTABLISHMENT AND DISTRIBUTION.— 

17 ‘‘(A) IN GENERAL.—Not later than 90 

18 days after the end of each calendar year, the 

19 Administrator shall establish and distribute to 

20 the entity taking the actions described in sub21 paragraph (A), (B), or (C) of paragraph (1) a 

22 quantity of compensatory allowances equivalent 

23 to the number of tons of carbon dioxide equiva24 lent of avoided emissions achieved through such 

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1 satory allowances, the Administrator shall take 

2 into account the carbon dioxide equivalent value 

3 of any greenhouse gas resulting from such ac4 tion. 

5 ‘‘(B) SOURCE OF ALLOWANCES.—Compen6 satory allowances established under this sub7 section shall not be emission allowances estab8 lished under subsection (a). 

9 ‘‘(C) IDENTIFICATION NUMBERS.—The 

10 Administrator shall assign to each compen11 satory allowance established under subpara12 graph (A) a unique identification number. 

13 ‘‘(3) DEFINITIONS.—For purposes of this sub14 section— 

15 ‘‘(A) the term ‘destruction’ means the con16 version of a greenhouse gas by thermal, chem17 ical, or other means to another gas or set of 

18 gases with little or no carbon dioxide equivalent 

19 value; 

20 ‘‘(B) the term ‘nonemissive use’ means the 

21 use of fossil fuel as a feedstock in an industrial 

22 or manufacturing process to the extent that 

23 greenhouse gases are not emitted from such 

24 process, and to the extent that the products of 


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1 such process are not intended for use as, or to 

2 be contained in, a fuel; and 

3 ‘‘(C) the term ‘conversionary use’ means 

4 the conversion during research or manufac5 turing of a fluorinated gas into another green6 house gas or set of gases with a lower carbon 

7 dioxide equivalent value. 

8 ‘‘(4) FEEDSTOCK EMISSIONS STUDY.— 

9 ‘‘(A) The Administrator may conduct a 

10 study to determine the extent to which petro11 leum-based or coal-based liquid or gaseous fuel, 

12 petroleum coke, natural gas liquid, or natural 

13 gas are used as feedstocks in manufacturing 

14 processes to produce products and the green15 house gas emissions resulting from such uses. 

16 ‘‘(B) If as a result of such a study, the Ad17 ministrator determines that the use of such 

18 products by noncovered sources results in sub19 stantial emissions of greenhouse gases or their 

20 precursors and that such emissions have not 

21 been adequately addressed under other require22 ments of this Act, the Administrator may, after 

23 notice and comment rulemaking, promulgate a 

24 regulation reducing compensatory allowances 


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1 commensurately if doing so will not result in 

2 leakage. 

3 ‘‘(g) FLUORINATED GASES ASSESSMENT.— 

4 ‘‘(1) IN GENERAL.—Not later than March 31, 

5 2014, the Administrator shall conduct an assess6 ment of the regulation of non-hydrofluorocarbon 

7 fluorinated gases under this title (excluding 

8 perfluorocarbon) to determine whether the most ap9 propriate point of regulation of those gases is at— 

10 ‘‘(A) the gas manufacturer or importer 

11 level; or 

12 ‘‘(B) the downstream source of the emis13 sions. 

14 ‘‘(2) MODIFICATION OF DEFINITION.—If the 

15 Administrator determines, based on consideration of 

16 environmental effectiveness, cost-effectiveness, ad17 ministrative feasibility, extent of coverage of emis18 sions, and competitiveness considerations, that emis19 sions of non-hydrofluorocarbon fluorinated gases (ex20 cluding perfluorocarbons) can best be regulated by 

21 designating downstream emission sources as covered 

22 entities with compliance obligations under section 

23 722, the Administrator shall— 

24 ‘‘(A) after providing notice and an oppor25 tunity for comment, modify the definition of the 


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1 term ‘covered entity’ with respect to fluorinated 

2 gases (other than hydrofluorocarbons and 

3 perfluorocarbons) accordingly; and 

4 ‘‘(B) establish such requirements as are 

5 necessary to ensure compliance by the covered 

6 entities with the requirements of this title. 

7 ‘‘(h) REGULATIONS.—Not later than 24 months after 

8 the date of enactment of this title, the Administrator shall 

9 promulgate regulations to carry out the provisions of this 

10 title. 

11 ‘‘SEC. 722. PROHIBITION OF EXCESS EMISSIONS. 

12 ‘‘(a) PROHIBITION.—Except as provided in sub13 section (c), effective January 1, 2012, each covered entity 

14 is prohibited from emitting greenhouse gases, and having 

15 attributable greenhouse gas emissions, in combination, in 

16 excess of its allowable emissions level. A covered entity’s 

17 allowable emissions level for each calendar year is the 

18 number of emission allowances (or credits or other allow19 ances as provided in subsection (d)) it holds as of 12:01 

20 a.m. on April 1 (or a later date established by the Admin21 istrator under subsection (j)) of the following calendar 

22 year. 

23 ‘‘(b) METHODS OF DEMONSTRATING COMPLIANCE.— 

24 Except as otherwise provided in this section, the owner 

25 or operator of a covered entity shall not be considered to 


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1 be in compliance with the prohibition in subsection (a) un2 less, as of 12:01 a.m. on April 1 (or a later date estab3 lished by the Administrator under subsection (j)) of each 

4 calendar year starting in 2013, the owner or operator 

5 holds a quantity of emission allowances (or credits or other 

6 allowances as provided in subsection (d)) at least as great 

7 as the quantity calculated as follows: 

8 ‘‘(1) ELECTRICITY SOURCES.—For a covered 

9 entity described in section 700(13)(A), 1 emission 

10 allowance for each ton of carbon dioxide equivalent 

11 of greenhouse gas that such covered entity emitted 

12 in the previous calendar year, excluding emissions 

13 resulting from the combustion of— 

14 ‘‘(A) petroleum-based or coal-based liquid 

15 fuel; 

16 ‘‘(B) natural gas liquid; 

17 ‘‘(C) renewable biomass or gas derived 

18 from renewable biomass; or 

19 ‘‘(D) petroleum coke. 

20 ‘‘(2) FUEL PRODUCERS AND IMPORTERS.—For 

21 a covered entity described in section 700(13)(B), 1 

22 emission allowance for each ton of carbon dioxide 

23 equivalent of greenhouse gas that would be emitted 

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1 uid, produced or imported by such covered entity 

2 during the previous calendar year for sale or dis3 tribution in interstate commerce, assuming no cap4 ture and sequestration of any greenhouse gas emis5 sions. 

6 ‘‘(3) INDUSTRIAL GAS PRODUCERS AND IM7 PORTERS.—For a covered entity described in section 

8 700(13)(C), 1 emission allowance for each ton of 

9 carbon dioxide equivalent of fossil fuel-based carbon 

10 dioxide, nitrous oxide, or any other fluorinated gas 

11 that is a greenhouse gas (except for nitrogen 

12 trifluoride), or any combination thereof, produced or 

13 imported by such covered entity during the previous 

14 calendar year for sale or distribution in interstate 

15 commerce or released as fugitive emissions in the 

16 production of fluorinated gas. 

17 ‘‘(4) NITROGEN TRIFLUORIDE SOURCES.—For 

18 a covered entity described in section 700(13)(D), 1 

19 emission allowance for each ton of carbon dioxide 

20 equivalent of nitrogen trifluoride that such covered 

21 entity emitted in the previous calendar year. 

22 ‘‘(5) GEOLOGICAL SEQUESTRATION SITES.—For 

23 a covered entity described in section 700(13)(E), 1 

24 emission allowance for each ton of carbon dioxide 


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1 equivalent of greenhouse gas that such covered enti2 ty emitted in the previous calendar year. 

3 ‘‘(6) INDUSTRIAL STATIONARY SOURCES.—For 

4 a covered entity described in section 700(13)(F), 

5 (G), or (H), 1 emission allowance for each ton of 

6 carbon dioxide equivalent of greenhouse gas that 

7 such covered entity emitted in the previous calendar 

8 year, excluding emissions resulting from— 

9 ‘‘(A) the combustion of petroleum-based or 

10 coal-based liquid fuel; 

11 ‘‘(B) the combustion of natural gas liquid; 

12 ‘‘(C) the combustion of renewable biomass 

13 or gas derived from renewable biomass; 

14 ‘‘(D) the combustion of petroleum coke; or 

15 ‘‘(E) the use of any fluorinated gas that is 

16 a greenhouse gas purchased for use at that cov17 ered entity, except for nitrogen trifluoride. 

18 ‘‘(7) INDUSTRIAL FOSSIL FUEL-FIRED COMBUS19 TION DEVICES.—For a covered entity described in 

20 section 700(13)(I), 1 emission allowance for each 

21 ton of carbon dioxide equivalent of greenhouse gas 

22 that the devices emitted in the previous calendar 

23 year, excluding emissions resulting from the combus24 tion of— 


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1 ‘‘(A) petroleum-based or coal-based liquid 

2 fuel; 

3 ‘‘(B) natural gas liquid; 

4 ‘‘(C) renewable biomass or gas derived 

5 from renewable biomass; or 

6 ‘‘(D) petroleum coke. 

7 ‘‘(8) NATURAL GAS LOCAL DISTRIBUTION COM8 PANIES.—For a covered entity described in section 

9 700(13)(J), 1 emission allowance for each ton of 

10 carbon dioxide equivalent of greenhouse gas that 

11 would be emitted from the combustion of the natural 

12 gas, and any other gas meeting the specifications for 

13 commingling with natural gas for purposes of deliv14 ery, that such entity delivered during the previous 

15 calendar year to customers that are not covered enti16 ties, assuming no capture and sequestration of that 

17 greenhouse gas. 

18 ‘‘(9) R&D FACILITIES.— 

19 ‘‘(A) IN GENERAL.—For a qualified R&D 

20 facility that emitted 25,000 tons per year or 

21 more carbon dioxide equivalent in the previous 

22 calendar year, 1 emission allowance for each 

23 ton of carbon dioxide equivalent of greenhouse 

24 gas that such facility emitted in the previous 

25 calendar year. 


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1 ‘‘(B) TREATMENT.—A qualified R&D facil2 ity shall be treated as a separate covered entity 

3 solely for purposes of applying the requirements 

4 of this subsection. 

5 ‘‘(10) ALGAE-BASED FUELS.—Where carbon di6 oxide (or another greenhouse gas) is used as an 

7 input in the production of algae-based fuels, the Ad8 ministrator shall ensure that allowances are required 

9 to be held either for the carbon dioxide used to grow 

10 the algae or for the carbon dioxide emitted from 

11 combustion of the fuel produced from such algae, 

12 but not for both. 

13 ‘‘(11) FUGITIVE EMISSIONS.—The greenhouse 

14 gas emissions to which paragraphs (1), (4), (6), and 

15 (7) apply shall not include fugitive emissions of 

16 greenhouse gas, except to the extent the Adminis17 trator determines that data on the carbon dioxide 

18 equivalent value of greenhouse gas in the fugitive 

19 emissions can be provided with sufficient precision, 

20 reliability, accessibility, and timeliness to ensure the 

21 integrity of emission allowances, the allowance track22 ing system, and the limits on emissions. 

23 ‘‘(12) EXPORT EXEMPTION.—This section shall 

24 not apply to any petroleum-based or coal-based liq25 uid fuel, petroleum coke, natural gas liquid, fossil 


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1 fuel-based carbon dioxide, nitrous oxide, or 

2 fluorinated gas that is exported for sale or use. 

3 ‘‘(13) NATURAL GAS LIQUIDS.—Notwith4 standing subsection (a), if the owner or operator of 

5 a covered entity described in section 700(13)(B) 

6 that produces natural gas liquids does not take own7 ership of the liquids, and is not responsible for the 

8 distribution or use of the liquids in commerce, the 

9 owner of the liquids shall be responsible for compli10 ance with this section, section 723, and other rel11 evant sections of this title with respect to such liq12 uids. In the regulations promulgated under section 

13 721, the Administrator shall include such provisions 

14 with respect to such liquids as the Administrator de15 termines are appropriate to determine and ensure 

16 compliance, and to penalize noncompliance. In such 

17 a case, the owner of the covered entity shall provide 

18 to the Administrator, in a manner to be determined 

19 by the Administrator, information regarding the 

20 quantity and ownership of liquids produced at the 

21 covered entity. 

22 ‘‘(14) APPLICATION OF MULTIPLE PARA23 GRAPHS.—For a covered entity to which more than 

24 1 of paragraphs (1) through (8) apply, all applicable 

25 paragraphs shall apply, except that not more than 1 


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1 emission allowance shall be required for the same 

2 emission. 

3 ‘‘(c) PHASE-IN OF PROHIBITION.— 

4 ‘‘(1) INDUSTRIAL STATIONARY SOURCES.—The 

5 prohibition under subsection (a) shall first apply to 

6 a covered entity described in section 700(13)(D), 

7 (F), (G), (H), or (I), with respect to emissions oc8 curring during calendar year 2014. 

9 ‘‘(2) NATURAL GAS LOCAL DISTRIBUTION COM10 PANIES.—The prohibition under subsection (a) shall 

11 first apply to a covered entity described in section 

12 700(13)(J) with respect to deliveries occurring dur13 ing calendar year 2016. 

14 ‘‘(d) ADDITIONAL METHODS.—In addition to using 

15 the method of compliance described in subsection (b), a 

16 covered entity may do the following: 

17 ‘‘(1) OFFSET CREDITS.— 

18 ‘‘(A) CREDITS.— 

19 ‘‘(i) IN GENERAL.—Covered entities 

20 collectively may, in accordance with this 

21 paragraph, use offset credits to dem22 onstrate compliance for up to a maximum 

23 of 2,000,000,000 tons of greenhouse gas 

24 emissions annually. 


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1 ‘‘(ii) DEMONSTRATION OF COMPLI2 ANCE.—In any calendar year, a covered 

3 entity may demonstrate compliance by 

4 holding 1 domestic offset credit or 1.25 

5 international offset credits in lieu of an 

6 emission allowance, except as provided in 

7 subparagraph (D), up to a total number of 

8 offset credits described in subparagraph 

9 (B). 

10 ‘‘(B) APPLICABLE PERCENTAGE.— 

11 ‘‘(i) IN GENERAL.—The total number 

12 of offset credits referred to in subpara13 graph (A)(ii) for a covered entity for a 

14 given calendar year shall be determined 

15 by— 

16 ‘‘(I) dividing— 

17 ‘‘(aa) the tons of carbon di18 oxide equivalent of greenhouse 

19 gas emissions of the covered enti20 ty (except for the types of emis21 sions excluded under subpara22 graphs (A) through (D) of sub23 section (b)(1), subparagraphs (A) 

24 through (E) of subsection (b)(6), 

25 and subparagraphs (A) through 


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1 (D) of subsection (b)(7)) and at2 tributable greenhouse gas emis3 sions for the year before the pre4 ceding calendar year; by 

5 ‘‘(bb) the sum of the tons of 

6 carbon dioxide equivalent of 

7 greenhouse gas emissions of all 

8 covered entities (except for the 

9 types of emissions excluded under 

10 subparagraphs (A) through (D) 

11 of subsection (b)(1), subpara12 graphs (A) through (E) of sub13 section (b)(6), and subpara14 graphs (A) through (D) of sub15 section (b)(7)) and attributable 

16 greenhouse gas emissions for the 

17 year before the preceding cal18 endar year; and 

19 ‘‘(II) multiplying the quotient ob20 tained under subclause (I) by 

21 2,000,000,000. 

22 ‘‘(ii) APPLICABILITY.—Clause (i) shall 

23 apply to a covered entity (including a cov24 ered entity that commenced operation dur25 ing the preceding calendar year) even if 


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1 the covered entity had no greenhouse gas 

2 emissions or attributable greenhouse gas 

3 emissions described in that clause. 

4 ‘‘(iii) OFFSET CREDITS.—Not more 

than 3 5 ⁄4 of the applicable percentage under 

6 this paragraph may be used by holding domestic offset credits, and not more than 1 7 ⁄4

8 of the applicable percentage under this 

9 paragraph may be used by holding inter10 national offset credits, except as provided 

11 in subparagraph (C). 

12 ‘‘(C) MODIFIED PERCENTAGES.—If the 

13 Administrator determines that domestic offset 

14 credits available for use in demonstrating com15 pliance in any calendar year at domestic offset 

16 prices generally equal to or less than allowance 

17 prices, are likely to offset less than 900,000,000 

18 tons of greenhouse gas emissions (measured in 

19 tons of carbon dioxide equivalents), the Admin20 istrator shall increase the percent of emissions 

21 that can be offset through the use of inter22 national offset credits (and decrease the percent 

23 of emissions that can be allowed through the 

24 use of domestic offset credits by the same 

25 amount) to reflect the amount that 


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1 1,500,000,000 exceeds the number of domestic 

2 offset credits the Administrator determines is 

3 available for that year, up to a maximum of 

4 750,000,000 tons of greenhouse gas emissions. 

5 ‘‘(D) INTERNATIONAL OFFSET CREDITS.— 

6 Notwithstanding subparagraph (A), to dem7 onstrate compliance prior to calendar year 

8 2018, a covered entity may use 1 international 

9 offset credit in lieu of an emission allowance up 

10 to the amount permitted under this paragraph. 

11 ‘‘(E) PRESIDENT’S RECOMMENDATION.— 

12 The President may make a recommendation to 

13 Congress as to whether the number 

14 2,000,000,000 specified in subparagraphs (A) 

15 and (B) should be increased or decreased. 

16 ‘‘(2) TERM OFFSET CREDITS.— 

17 ‘‘(A) IN GENERAL.—Covered entities may, 

18 in accordance with this paragraph, use non-ex19 pired term offset credits instead of domestic 

20 offset credits for purposes of temporarily dem21 onstrating compliance with this section. 

22 ‘‘(B) AMOUNT.—The combined quantity of 

23 term offset credits and domestic offset credits 

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1 house gas emissions in any given year shall not 

2 exceed the quantity of domestic offset credits 

3 that a covered entity is entitled to use for that 

4 year to demonstrate compliance in accordance 

5 with paragraph (1). 

6 ‘‘(C) EXPIRATION.—A term offset credit 

7 shall expire in the year after its term ends. The 

8 term of a term offset credit shall be calculated 

9 by adding to the year of issuance the number 

10 of years equal to the length of the crediting pe11 riod for the practice or project for which the 

12 term offset credit was issued, but in no case 

13 shall be later than the date 5 years from the 

14 date of issuance. 

15 ‘‘(D) DEMONSTRATING COMPLIANCE UPON

16 EXPIRATION OF TERM OFFSET CREDIT.—With 

17 respect to the emissions for which a covered en18 tity is using term offset credits to demonstrate 

19 compliance temporarily with this section, the 

20 owner or operator of a covered entity shall not 

21 be considered to be in compliance with the pro22 hibition in subsection (a) unless, as of 12:01 

23 a.m. on April 1 (or a later date established by 

24 the Administrator under subsection (j)) of the 


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1 calendar year in which a term offset credit ex2 pires, the owner or operator holds— 

3 ‘‘(i) for purposes of finally dem4 onstrating compliance, an allowance or a 

5 domestic offset credit; or 

6 ‘‘(ii) for purposes of temporarily dem7 onstrating compliance, a non-expired term 

8 offset credit. 

9 ‘‘(E) INAPPLICABILITY OF PERCENTAGE

10 LIMITATIONS.—Domestic offset credits used for 

11 purposes of finally demonstrating compliance 

12 under this subparagraph shall not be subject to 

13 the percentage limitations in subparagraph (B). 

14 ‘‘(F) FINANCIAL ASSURANCE.—A covered 

15 entity may not use a term offset credit to dem16 onstrate compliance temporarily unless it simul17 taneously provides to the Administrator finan18 cial assurance that, at the end of the term off19 set credit‘s crediting term, the covered entity 

20 will have sufficient resources to obtain the 

21 quantity of allowances or credits necessary to 

22 demonstrate final compliance. The Adminis23 trator shall issue regulations establishing re24 quirements for such financial assurance, which 

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1 ciated with longer crediting terms. These regu2 lations shall take into account the total number 

3 of tons of carbon dioxide equivalent of green4 house gas emissions for which a covered entity 

5 is demonstrating compliance temporarily, and 

6 may set a limit on this amount. In the event 

7 that a covered entity that used term offset cred8 its to demonstrate compliance temporarily fails 

9 to meet the requirements of subparagraph (D) 

10 at the end of the term offset credits’ crediting 

11 term, if the financial assurance mechanism fails 

12 to provide to the Administrator the number of 

13 allowances or offset credits for which the cred14 iting term has expired, then the Administrator 

15 shall retire that number of allowances with the 

16 vintage year 2 years after the year in which the 

17 term offset credit expires in the same amount. 

18 Allowances so retired shall not be counted as 

19 emission allowances established for that cal20 endar year under section 721(a). 

21 ‘‘(3) INTERNATIONAL EMISSION ALLOW22 ANCES.—To demonstrate compliance, a covered enti23 ty may hold an international emission allowance in 

24 lieu of an emission allowance, except as modified 

25 under section 728(d). 


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1 ‘‘(4) COMPENSATORY ALLOWANCES.—To dem2 onstrate compliance, a covered entity may hold a 

3 compensatory allowance obtained under section 

4 721(f) in lieu of an emission allowance. 

5 ‘‘(e) RETIREMENT OF ALLOWANCES AND CREDITS.— 

6 As soon as practicable after a deadline established for cov7 ered entities to demonstrate compliance with this title, the 

8 Administrator shall retire the quantity of allowances or 

9 credits required to be held under this title. 

10 ‘‘(f) ALTERNATIVE METRICS.—For categories of cov11 ered entities described in subparagraph (B), (C), (D), (G), 

12 (H), or (I) of section 700(13), the Administrator may, by 

13 rule, establish an applicability threshold for inclusion 

14 under those subparagraphs using an alternative metric 

15 and level, provided that such metric and level are easier 

16 to administer and cover the same size and type of sources 

17 as the threshold defined in such subparagraphs. 

18 ‘‘(g) THRESHOLD REVIEW.—For each category of 

19 covered entities described in subparagraph (B), (C), (D), 

20 (G), (H), or (I) of section 700(13), the Administrator 

21 shall, in 2020 and once every 8 years thereafter, review 

22 the carbon dioxide equivalent emission thresholds that are 

23 used to define covered entities. After consideration of— 

24 ‘‘(1) emissions from covered entities in each 

25 such category, and from other entities of the same 


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1 type that emit less than the threshold amount for 

2 the category (including emission sources that com3 mence operation after the date of enactment of this 

4 title that are not covered entities); and 

5 ‘‘(2) whether greater greenhouse gas emission 

6 reductions can be cost-effectively achieved by low7 ering the applicable threshold, 

8 the Administrator may by rule lower such threshold to not 

9 less than 10,000 tons of carbon dioxide equivalent emis10 sions. In determining the cost effectiveness of potential re11 ductions from lowering the threshold for covered entities, 

12 the Administrator shall consider alternative regulatory 

13 greenhouse gas programs, including setting standards 

14 under other titles of this Act. 

15 ‘‘(h) DESIGNATED REPRESENTATIVES.—The regula16 tions promulgated under section 721(h) shall require that 

17 each covered entity, and each entity holding allowances or 

18 credits or receiving allowances or credits from the Admin19 istrator under this title, select a designated representative. 

20 ‘‘(i) EDUCATION AND OUTREACH.— 

21 ‘‘(1) IN GENERAL.—The Administrator shall es22 tablish and carry out a program of education and 

23 outreach to assist covered entities, especially entities 

24 having little experience with environmental regu25 latory requirements similar or comparable to those 


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1 under this title, in preparing to meet the compliance 

2 obligations of this title. Such program shall include 

3 education with respect to using markets to effec4 tively achieve such compliance. 

5 ‘‘(2) FAILURE TO RECEIVE INFORMATION.—A 

6 failure to receive information or assistance under 

7 this subsection may not be used as a defense against 

8 an allegation of any violation of this title. 

9 ‘‘(j) ADJUSTMENT OF DEADLINE.—The Adminis10 trator may, by rule, establish a deadline for demonstrating 

11 compliance, for a calendar year, later than the date pro12 vided in subsection (a), as necessary to ensure the avail13 ability of emissions data, but in no event shall the deadline 

14 be later than June 1. 

15 ‘‘(k) NOTICE REQUIREMENT FOR COVERED ENTI16 TIES RECEIVING NATURAL GAS FROM NATURAL GAS

17 LOCAL DISTRIBUTION COMPANIES.—The owner or oper18 ator of a covered entity that takes delivery of natural gas 

19 from a natural gas local distribution company shall, not 

20 later than September 1 of each calendar year, notify such 

21 natural gas local distribution company in writing that 

22 such entity will qualify as a covered entity under this title 

23 for that calendar year. 

24 ‘‘(l) COMPLIANCE OBLIGATION.—For purposes of 

25 this title, the year of a compliance obligation is the year 


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1 in which compliance is determined, not the year in which 

2 the greenhouse gas emissions occur or the covered entity 

3 has attributable greenhouse gas emissions. 

4 ‘‘SEC. 723. PENALTY FOR NONCOMPLIANCE. 

5 ‘‘(a) ENFORCEMENT.—A violation of any prohibition 

6 of, requirement of, or regulation promulgated pursuant to 

7 this title shall be a violation of this Act. It shall be a viola8 tion of this Act for a covered entity to emit greenhouse 

9 gases, and have attributable greenhouse gas emissions, in 

10 combination, in excess of its allowable emissions level as 

11 provided in section 722(a). Each ton of carbon dioxide 

12 equivalent for which a covered entity fails to demonstrate 

13 compliance under section 722(b) shall be a separate viola14 tion. In the event that a covered entity fails to dem15 onstrate compliance at the expiration of a term of offset 

16 credits crediting term as required by section 722(d)(2)(D), 

17 the year of the violation shall be the year in which the 

18 term offset credit expires. 

19 ‘‘(b) EXCESS EMISSIONS PENALTY.— 

20 ‘‘(1) IN GENERAL.—The owner or operator of 

21 any covered entity that fails for any year to comply, 

22 on the deadline described in section 722(a) or (j), 

23 shall be liable for payment to the Administrator of 

24 an excess emissions penalty in the amount described 

25 in paragraph (2). 


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1 ‘‘(2) AMOUNT.—The amount of an excess emis2 sions penalty required to be paid under paragraph 

3 (1) shall be equal to the product obtained by multi4 plying— 

5 ‘‘(A) the tons of carbon dioxide equivalent 

6 of greenhouse gas emissions or attributable 

7 greenhouse gas emissions for which the owner 

8 or operator of a covered entity failed to comply 

9 under section 722(b) on the deadline; by 

10 ‘‘(B) twice the fair market value of emis11 sion allowances established for emissions occur12 ring in the calendar year for which the emission 

13 allowances were due. 

14 ‘‘(3) TIMING.—An excess emissions penalty re15 quired under this subsection shall be immediately 

16 due and payable to the Administrator, without de17 mand, in accordance with regulations promulgated 

18 by the Administrator, which shall be issued not later 

19 than 2 years after the date of enactment of this 

20 title. 

21 ‘‘(4) NO EFFECT ON LIABILITY.—An excess 

22 emissions penalty due and payable by the owners or 

23 operators of a covered entity under this subsection 

24 shall not diminish the liability of the owners or oper25 ators for any fine, penalty, or assessment against 


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1 the owners or operators for the same violation under 

2 any other provision of this Act or any other law. 

3 ‘‘(c) EXCESS EMISSIONS ALLOWANCES.—The owner 

4 or operator of a covered entity that fails for any year to 

5 comply on the deadline described in section 722(a) or (j) 

6 shall be liable to offset the covered entity’s excess com7 bination of greenhouse gases emitted and attributable 

8 greenhouse gas emissions by an equal quantity of emission 

9 allowances during the following calendar year, or such 

10 longer period as the Administrator may prescribe. During 

11 the year in which the covered entity failed to comply, or 

12 any year thereafter, the Administrator may deduct the 

13 emission allowances required under this subsection to off14 set the covered entity’s excess actual or attributable emis15 sions. 

16 ‘‘SEC. 724. TRADING. 

17 ‘‘(a) PERMITTED TRANSACTIONS.—Except as other18 wise provided in this title, the lawful holder of an emission 

19 allowance, compensatory allowance, or offset credit may, 

20 without restriction, sell, exchange, transfer, hold for com21 pliance in accordance with section 722, or request that the 

22 Administrator retire the emission allowance, compensatory 

23 allowance, or offset credit. 

24 ‘‘(b) NO RESTRICTION ON TRANSACTIONS.—The 

25 privilege of purchasing, holding, selling, exchanging, 


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1 transferring, and requesting retirement of emission allow2 ances, compensatory allowances, or offset credits shall not 

3 be restricted to the owners and operators of covered enti4 ties, except as otherwise provided in this title. 

5 ‘‘(c) EFFECTIVENESS OF ALLOWANCE TRANS6 FERS.—No transfer of an allowance or offset credit shall 

7 be effective for purposes of this title until a certification 

8 of the transfer, signed by the designated representative of 

9 the transferor, is received and recorded by the Adminis10 trator in accordance with regulations promulgated under 

11 section 721(h). 

12 ‘‘(d) ALLOWANCE TRACKING SYSTEM.—The regula13 tions promulgated under section 721(h) shall include a 

14 system for issuing, recording, holding, and tracking allow15 ances, offset credits, and term offset credits that shall 

16 specify all necessary procedures and requirements for an 

17 orderly and competitive functioning of the allowance and 

18 offset credit markets. Such regulations shall provide for 

19 appropriate publication of the information in the system 

20 on the Internet. 

21 ‘‘SEC. 725. BANKING AND BORROWING. 

22 ‘‘(a) BANKING.—An emission allowance may be used 

23 to comply with section 722 or 723 for emissions in— 

24 ‘‘(1) the vintage year for the allowance; or 


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1 ‘‘(2) any calendar year subsequent to the vin2 tage year for the allowance. 

3 ‘‘(b) EXPIRATION.— 

4 ‘‘(1) REGULATIONS.—The Administrator may 

5 establish by regulation criteria and procedures for 

6 determining whether, and for implementing a deter7 mination that, the expiration of an allowance, credit, 

8 or term offset credit established or issued by the Ad9 ministrator under this title, or expiration of the abil10 ity to use an international emission allowance to 

11 comply with section 722, is necessary to ensure the 

12 authenticity and integrity of allowances, credits, or 

13 term offset credits or the allowance tracking system. 

14 ‘‘(2) GENERAL RULE.—An allowance, credit, or 

15 term offset credit established or issued by the Ad16 ministrator under this title shall not expire unless— 

17 ‘‘(A) it is retired by the Administrator as 

18 required under this title; or 

19 ‘‘(B) it is determined to expire or to have 

20 expired by a specific date by the Administrator 

21 in accordance with regulations promulgated 

22 under paragraph (1). 

23 ‘‘(3) INTERNATIONAL EMISSION ALLOW24 ANCES.—The ability to use an international emission 


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1 allowance to comply with section 722 shall not ex2 pire unless— 

3 ‘‘(A) the allowance is retired by the Ad4 ministrator as required by this title; or 

5 ‘‘(B) the ability to use such allowance to 

6 meet such compliance obligation requirements is 

7 determined to expire or to have expired by a 

8 specific date by the Administrator in accord9 ance with regulations promulgated under para10 graph (1). 

11 ‘‘(c) BORROWING FUTURE VINTAGE YEAR ALLOW12 ANCES.— 

13 ‘‘(1) BORROWING WITHOUT INTEREST.—In ad14 dition to the uses described in subsection (a), an 

15 emission allowance may be used to comply with sec16 tion 722(a) or 723 for emissions, production, impor17 tation, manufacture, or deliveries in the calendar 

18 year immediately preceding the vintage year for the 

19 allowance. 

20 ‘‘(2) BORROWING WITH INTEREST.— 

21 ‘‘(A) IN GENERAL.—A covered entity may 

22 demonstrate compliance under subsection (b) in 

23 a specific calendar year for up to 15 percent of 

24 its emissions by holding emission allowances 


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1 with a vintage year 1 to 5 years later than that 

2 calendar year. 

3 ‘‘(B) LIMITATIONS.—An emission allow4 ance borrowed pursuant to this paragraph shall 

5 be an emission allowance that is established by 

6 the Administrator for a specific future calendar 

7 year under section 721(a) and that is held by 

8 the borrower. 

9 ‘‘(C) PREPAYMENT OF INTEREST.—For 

10 each emission allowance that an owner or oper11 ator of a covered entity borrows pursuant to 

12 this paragraph, such owner or operator shall, at 

13 the time it borrows the allowance, hold for re14 tirement by the Administrator a quantity of 

15 emission allowances that is equal to the product 

16 obtained by multiplying— 

17 ‘‘(i) 0.08; by 

18 ‘‘(ii) the number of years between the 

19 calendar year in which the allowance is 

20 being used to satisfy a compliance obliga21 tion and the vintage year of the allowance. 

22 ‘‘SEC. 726. MARKET STABILITY RESERVE. 

23 ‘‘(a) MARKET STABILITY RESERVE AUCTIONS.— 

24 ‘‘(1) IN GENERAL.—Once each quarter of each 

25 calendar year for which allowances are established 


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1 under section 721(a), the Administrator shall auc2 tion market stability reserve allowances. 

3 ‘‘(2) RESTRICTION TO COVERED ENTITIES.—In 

4 each auction conducted under paragraph (1), only 

5 covered entities that the Administrator expects will 

6 be required to comply with section 722 in the fol7 lowing calendar year shall be eligible to make pur8 chases. 

9 ‘‘(b) POOL OF EMISSION ALLOWANCES FOR MARKET

10 STABILITY RESERVE AUCTIONS.— 

11 ‘‘(1) FILLING THE MARKET STABILITY RE12 SERVE INITIALLY.— 

13 ‘‘(A) IN GENERAL.—The Administrator 

14 shall, not later than 2 years after the date of 

15 enactment of this title, establish a market sta16 bility reserve account, and shall place in that 

17 account an amount of emission allowances es18 tablished under section 721(a). 

19 ‘‘(B) EFFECT ON OTHER PROVISIONS.— 

20 Any provision in this title (except for subpara21 graph (B) of this paragraph) that refers to a 

22 quantity or percentage of the emission allow23 ances established for a calendar year under sec24 tion 721(a) shall be considered to refer to the 

25 amount of emission allowances as determined 


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1 pursuant to section 721(e), less any emission 

2 allowances established for that year that are 

3 placed in the market stability reserve account 

4 under this paragraph. 

5 ‘‘(2) SUPPLEMENTING THE MARKET STABILITY

6 RESERVE.—The Administrator shall also— 

7 ‘‘(A) at the end of each calendar year, 

8 transfer to the market stability reserve account 

9 each emission allowance that was offered for 

10 sale but not sold at any auction conducted 

11 under section 778; and 

12 ‘‘(B) transfer emission allowances estab13 lished under subsection (g) from auction pro14 ceeds, and deposit them into the market sta15 bility reserve, to the extent necessary to main16 tain the reserve at its original size. 

17 ‘‘(c) MINIMUM MARKET STABILITY RESERVE AUC18 TION PRICE.— 

19 ‘‘(1) IN GENERAL.—At each market stability re20 serve auction, the Administrator shall offer emission 

21 allowances for sale beginning at a minimum price 

22 per emission allowance, which shall be known as the 

23 ‘minimum market stability reserve auction price’. 

24 ‘‘(2) INITIAL MINIMUM MARKET STABILITY RE25 SERVE AUCTION PRICES.—The minimum market 


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1 stability reserve auction price shall be $28 (in con2 stant 2005 dollars) for the market stability reserve 

3 auctions held in 2012. For the market stability re4 serve auctions held in 2013 through 2017, the min5 imum market stability reserve auction price shall be 

6 the market stability reserve auction price for the 

7 previous year increased by 5 percent plus the rate of 

8 inflation (as measured by the Consumer Price Index 

9 for All Urban Consumers). 

10 ‘‘(3) MINIMUM MARKET STABILITY RESERVE

11 AUCTION PRICE IN SUBSEQUENT YEARS.—For each 

12 market stability reserve auction held in 2018 and 

13 each year thereafter, the minimum market stability 

14 reserve auction price shall be the market stability re15 serve auction price for the previous year increased 

16 by 7 percent, plus the rate of inflation (as measured 

17 by the Consumer Price Index for All Urban Con18 sumers). 

19 ‘‘(d) QUANTITY OF EMISSION ALLOWANCES RE20 LEASED FROM THE MARKET STABILITY RESERVE.— 

21 ‘‘(1) INITIAL LIMITS.—Subject to paragraph 

22 (4), for each of calendar years 2012 through 2016, 

23 the annual limit on the number of emission allow24 ances from the market stability reserve account that 

25 may be auctioned is an amount equal to 15 percent 


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1 of the emission allowances established for that cal2 endar year under section 721(a). This limit does not 

3 apply to offset credits sold on consignment pursuant 

4 to subsection (h). 

5 ‘‘(2) LIMITS IN SUBSEQUENT YEARS.—Subject 

6 to paragraph (4), for calendar year 2017 and each 

7 year thereafter, the annual limit on the number of 

8 emission allowances from the market stability re9 serve account that may be auctioned is an amount 

10 equal to 25 percent of the emission allowances estab11 lished for that calendar year under section 721(a). 

12 This limit does not apply to offset credits sold on 

13 consignment pursuant to subsection (h). 

14 ‘‘(3) ALLOCATION OF LIMITATION.—One-fourth 

15 of each year’s annual market stability reserve auc16 tion limit under this subsection shall be made avail17 able for auction in each quarter. Any allowances 

18 from the market stability reserve account that are 

19 made available for sale in a quarterly auction and 

20 not sold shall be rolled over and added to the quan21 tity available for sale in the following quarter, except 

22 that allowances not sold at auction in the fourth 

23 quarter of a year shall not be rolled over to the fol24 lowing calendar year’s auctions, but shall be re25 turned to the market stability reserve account. 


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1 ‘‘(4) AUTHORITY TO ADJUST LIMITATION.—The 

2 Administrator may adjust the limits in paragraphs 

3 (1) or (2) if the Administrator determines an adjust4 ment is required to prevent disruptively high prices 

5 or to preserve the integrity of the market stability 

6 reserve. 

7 ‘‘(e) PURCHASE LIMIT.— 

8 ‘‘(1) IN GENERAL.—Except as provided in para9 graph (2) or (3), the annual number of emission al10 lowances that a covered entity may purchase at the 

11 market stability reserve auctions in each calendar 

12 year shall not exceed 20 percent of the covered enti13 ty’s emissions during the most recent year for which 

14 allowances or credits were retired under section 722. 

15 ‘‘(2) 2012 LIMIT.—For calendar year 2012, the 

16 maximum aggregate number of emission allowances 

17 that a covered entity may purchase from that year’s 

18 market stability reserve auctions shall be 20 percent 

19 of the covered entity’s greenhouse gas emissions that 

20 the covered entity reported to the registry estab21 lished under section 713 for 2011 and that would be 

22 subject to section 722(a) if occurring in later cal23 endar years. 

24 ‘‘(3) NEW ENTRANTS.—The Administrator 

25 shall, by regulation, establish a separate purchase 


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1 limit applicable to entities that expect to become a 

2 covered entity in the year of the auction, permitting 

3 them to purchase emission allowances at the market 

4 stability reserve auctions in their first calendar year 

5 of operation in an amount of at least 20 percent of 

6 their expected combined emissions and attributable 

7 greenhouse gas emissions for that year. 

8 ‘‘(f) DELEGATION OR CONTRACT.—Pursuant to regu9 lations under this section, the Administrator may, by dele10 gation or contract, provide for the conduct of market sta11 bility reserve auctions under the Administrator’s super12 vision by other departments or agencies of the Federal 

13 Government or by nongovernmental agencies, groups, or 

14 organizations. 

15 ‘‘(g) USE OF AUCTION PROCEEDS.— 

16 ‘‘(1) DEPOSIT IN MARKET STABILITY RESERVE

17 FUND.—The proceeds from market stability reserve 

18 auctions shall be placed in the Market Stability Re19 serve Fund established by subsection (j), and shall 

20 be available without further appropriation or fiscal 

21 year limitation for the purposes described in this 

22 subsection. 

23 ‘‘(2) OFFSET CREDITS.—The Administrator 

24 shall use the proceeds from each market stability re25 serve auction to purchase offset credits, including 


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1 domestic offset credits and international offset cred2 its issued for reduced deforestation activities pursu3 ant to section 753. The Administrator shall retire 

4 those offset credits and establish a number of emis5 sion allowances equal to the number of international 

6 offset credits so retired. Emission allowances estab7 lished under this paragraph shall be in addition to 

8 those established under section 721(a). 

9 ‘‘(3) EMISSION ALLOWANCES.—The Adminis10 trator shall deposit emission allowances established 

11 under paragraph (2) in the market stability reserve, 

12 except that, with respect to any such emission allow13 ances in excess of the amount necessary to fill the 

14 market stability reserve to its original size, the Ad15 ministrator shall— 

16 ‘‘(A) except as provided in subparagraph 

17 (B), assign a vintage year to the emission al18 lowance, which shall be no earlier than the year 

19 in which the allowance is established under 

20 paragraph (2) and shall treat such allowances 

21 as ones that are not designated for distribution 

22 or auction; and 

23 ‘‘(B) to the extent any such allowances 

24 cannot be assigned a vintage year because of 


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1 the limitation in paragraph (4), retire the allow2 ances. 

3 ‘‘(4) LIMITATION.—In no case may the Admin4 istrator assign under paragraph (3)(A) more emis5 sion allowances to a vintage year than the number 

6 of emission allowances from that vintage year that 

7 were placed in the market stability reserve account 

8 under subsection (b)(1). 

9 ‘‘(h) AVAILABILITY OF OFFSET CREDITS FOR AUC10 TION.— 

11 ‘‘(1) IN GENERAL.—The regulations promul12 gated under section 721(h) shall allow any entity 

13 holding offset credits to request that the Adminis14 trator include such offset credits in an upcoming 

15 market stability reserve auction. The regulations 

16 shall provide that— 

17 ‘‘(A) upon sale of such offset credits, the 

18 Administrator shall retire those offset credits, 

19 and establish and provide to the purchasers a 

20 number of emission allowances equal to the 

21 number of offset credits so retired, which allow22 ances shall be in addition to those established 

23 under section 721(a); and 

24 ‘‘(B) for offset credits sold pursuant to 

25 this subsection, the proceeds for the entity that 


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1 offered the offset credits for sale shall be the 

2 lesser of— 

3 ‘‘(i) the average daily closing price for 

4 offset credits sold on registered exchanges 

5 (or if such price is unavailable, the average 

6 price as determined by the Administrator) 

7 during the six months prior to the market 

8 stability reserve auction at which they were 

9 auctioned, with the remaining funds col10 lected upon the sale of the offset credits 

11 deposited in the Treasury; and 

12 ‘‘(ii) the amount received for the off13 set credits at the auction. 

14 ‘‘(2) PROCEEDS.—For offset credits sold pursu15 ant to this subsection, notwithstanding section 3302 

16 of title 31, United States Code, or any other provi17 sion of law, within 90 days of receipt, the United 

18 States shall transfer the proceeds from the auction, 

19 as defined in paragraph (1)(D), to the entity that 

20 offered the offset credits for sale. No funds trans21 ferred from a purchaser to a seller of offset credits 

22 under this paragraph shall be held by any officer or 

23 employee of the United States or treated for any 

24 purpose as public monies. 


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1 ‘‘(3) PRICING.—When the Administrator acts 

2 under this subsection as the agent of an entity in 

3 possession of offset credits, the Administrator is not 

4 obligated to obtain the highest price possible for the 

5 offset credits, and instead shall auction such offset 

6 credits in the same manner and pursuant to the 

7 same rules (except as modified in paragraph (1)) as 

8 set forth for auctioning market stability reserve al9 lowances. Entities requesting that such offset credits 

10 be offered for sale at a market stability reserve auc11 tion may not set a minimum reserve price for their 

12 offset credits that is different than the minimum 

13 market stability reserve auction price set pursuant 

14 to subsection (c). 

15 ‘‘(i) INITIAL REGULATIONS.—Not later than 24 

16 months after the date of enactment of this title, the Ad17 ministrator shall promulgate regulations, in consultation 

18 with other appropriate agencies, governing the auction of 

19 allowances under this section. Such regulations shall in20 clude the following requirements: 

21 ‘‘(1) FREQUENCY; FIRST AUCTION.—Auctions 

22 shall be held four times per year at regular intervals, 

23 with the first auction to be held no later than March 

24 31, 2012. 


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1 ‘‘(2) AUCTION FORMAT.—Auctions shall follow 

2 a single-round, sealed-bid, uniform price format. 

3 ‘‘(3) PARTICIPATION; FINANCIAL ASSURANCE.— 

4 Auctions shall be open to any covered entity eligible 

5 to purchase emission allowances at the auction 

6 under subsection (a)(2), except that the Adminis7 trator may establish financial assurance require8 ments to ensure that auction participants can and 

9 will perform on their bids. 

10 ‘‘(4) DISCLOSURE OF BENEFICIAL OWNER11 SHIP.—Each bidder in an auction shall be required 

12 to disclose the person or entity sponsoring or bene13 fitting from the bidder’s participation in the auction 

14 if such person or entity is, in whole or in part, other 

15 than the bidder. 

16 ‘‘(5) PURCHASE LIMITS.—No person may, di17 rectly or in concert with another participant, pur18 chase more than 20 percent of the allowances of19 fered for sale at any quarterly auction. 

20 ‘‘(6) PUBLICATION OF INFORMATION.—After 

21 the auction, the Administrator shall, in a timely 

22 fashion, publish the identities of winning bidders, 

23 the quantity of allowances obtained by each winning 

24 bidder, and the auction clearing price. 


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1 ‘‘(7) OTHER REQUIREMENTS.—The Adminis2 trator may include in the regulations such other re3 quirements or provisions as the Administrator, in 

4 consultation with other agencies as appropriate, con5 siders appropriate to promote effective, efficient, 

6 transparent, and fair administration of auctions 

7 under this section. 

8 ‘‘(j) MARKET STABILITY RESERVE FUND.—There 

9 are established in the Treasury of the United States a 

10 fund to be known as the ‘Market Stability Reserve Fund’. 

11 ‘‘(k) REVISION OF REGULATIONS.—The Adminis12 trator may, at any time, in consultation with other agen13 cies as appropriate, revise the initial regulations promul14 gated under subsection (i). Such revised regulations need 

15 not meet the requirements identified in subsection (i) if 

16 the Administrator determines that an alternative auction 

17 design would be more effective, taking into account factors 

18 including costs of administration, transparency, fairness, 

19 and risks of collusion or manipulation. In determining 

20 whether and how to revise the initial regulations under 

21 this subsection, the Administrator shall not consider maxi22 mization of revenues to the Federal Government. 

23 ‘‘SEC. 727. PERMITS. 

24 ‘‘(a) PERMIT PROGRAM.—For stationary sources 

25 subject to title V of this Act, that are covered entities, 


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1 the provisions of this title shall be implemented by permits 

2 issued to such covered entities (and enforced) in accord3 ance with the provisions of title V, as modified by this 

4 title. Any such permit issued by the Administrator, or by 

5 a State with an approved permit program, shall require 

6 the owner or operator of a covered entity to hold emission 

7 allowances or offset credits at least equal to the total an8 nual amount of carbon dioxide equivalents for its com9 bined emissions and attributable greenhouse gas emissions 

10 to which section 722 applies. No such permit shall be 

11 issued that is inconsistent with the requirements of this 

12 title, and title V as applicable. Nothing in this section re13 garding compliance plans or in title V shall be construed 

14 as affecting allowances or offset credits. Submission of a 

15 statement by the owner or operator, or the designated rep16 resentative of the owners and operators, of a covered enti17 ty that the owners and operators will hold emission allow18 ances or offset credits for the entity’s combined emissions 

19 and attributable greenhouse gas emissions to which sec20 tion 722 applies shall be deemed to meet the proposed and 

21 approved planning requirements of title V. Recordation by 

22 the Administrator of transfers of emission allowances shall 

23 amend automatically all applicable proposed or approved 

24 permit applications, compliance plans, and permits. 


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1 ‘‘(b) MULTIPLE OWNERS.—No permit shall be issued 

2 under this section and no allowances or offset credits shall 

3 be disbursed under this title to a covered entity or any 

4 other person until the designated representative of the 

5 owners or operators has filed a certificate of representa6 tion with regard to matters under this title, including the 

7 holding and distribution of emission allowances and the 

8 proceeds of transactions involving emission allowances. 

9 Where there are multiple holders of a legal or equitable 

10 title to, or a leasehold interest in, such a covered entity 

11 or other entity or where a utility or industrial customer 

12 purchases power under a long-term power purchase con13 tract from an independent power production facility that 

14 is a covered entity, the certificate shall state— 

15 ‘‘(1) that emission allowances and the proceeds 

16 of transactions involving emission allowances will be 

17 deemed to be held or distributed in proportion to 

18 each holder’s legal, equitable, leasehold, or contrac19 tual reservation or entitlement; or 

20 ‘‘(2) if such multiple holders have expressly pro21 vided for a different distribution of emission allow22 ances by contract, that emission allowances and the 

23 proceeds of transactions involving emission allow24 ances will be deemed to be held or distributed in ac25 cordance with the contract. 


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1 A passive lessor, or a person who has an equitable interest 

2 through such lessor, whose rental payments are not based, 

3 either directly or indirectly, upon the revenues or income 

4 from the covered entity or other entity shall not be deemed 

5 to be a holder of a legal, equitable, leasehold, or contrac6 tual interest for the purpose of holding or distributing 

7 emission allowances as provided in this subsection, during 

8 either the term of such leasehold or thereafter, unless ex9 pressly provided for in the leasehold agreement. Except 

10 as otherwise provided in this subsection, where all legal 

11 or equitable title to or interest in a covered entity, or other 

12 entity, is held by a single person, the certificate shall state 

13 that all emission allowances received by the entity are 

14 deemed to be held for that person. 

15 ‘‘(c) PROHIBITION.—It shall be unlawful for any per16 son to operate any stationary source subject to the re17 quirements of this section except in compliance with the 

18 terms and requirements of a permit issued by the Admin19 istrator or a State with an approved permit program in 

20 accordance with this section. For purposes of this sub21 section, compliance, as provided in section 504(f), with a 

22 permit issued under title V which complies with this title 

23 for covered entities shall be deemed compliance with this 

24 subsection as well as section 502(a). 


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1 ‘‘(d) RELIABILITY.—Nothing in this section or title 

2 V shall be construed as requiring termination of oper3 ations of a stationary source that is a covered entity for 

4 failure to have an approved permit, or compliance plan, 

5 that is consistent with the requirements in the second and 

6 fifth sentences of subsection (a) concerning the holding 

7 of emission allowances, compensatory allowances, inter8 national emission allowances, or offset allowances, except 

9 that any such covered entity may be subject to the applica10 ble enforcement provision of section 113. 

11 ‘‘(e) REGULATIONS.—The Administrator shall pro12 mulgate regulations to implement this section. To provide 

13 for permits required under this section, each State in 

14 which one or more stationary sources and that are covered 

15 entities are located shall submit, in accordance with this 

16 section and title V, revised permit programs for approval. 

17 ‘‘SEC. 728. INTERNATIONAL EMISSION ALLOWANCES. 

18 ‘‘(a) QUALIFYING PROGRAMS.—The Administrator, 

19 in consultation with the Secretary of State, may by rule 

20 designate an international climate change program as a 

21 qualifying international program if— 

22 ‘‘(1) the program is run by a national or supra23 national foreign government, and imposes a manda24 tory absolute tonnage limit on greenhouse gas emis25 sions from 1 or more foreign countries, or from 1 or 


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1 more economic sectors in such a country or coun2 tries; and 

3 ‘‘(2) the program is at least as stringent as the 

4 program established by this title, including provi5 sions to ensure at least comparable monitoring, com6 pliance, enforcement, quality of offsets, and restric7 tions on the use of offsets. 

8 ‘‘(b) DISQUALIFIED ALLOWANCES.—An international 

9 emission allowance may not be held under section 

10 722(d)(3) if it is in the nature of an offset instrument 

11 or allowance awarded based on the achievement of green12 house gas emission reductions or avoidance, or greenhouse 

13 gas sequestration, that are not subject to the mandatory 

14 absolute tonnage limits referred to in subsection (a)(1). 

15 ‘‘(c) RETIREMENT.— 

16 ‘‘(1) ENTITY CERTIFICATION.—The owner or 

17 operator of an entity that holds an international 

18 emission allowance under section 722(d)(3) shall 

19 certify to the Administrator that such international 

20 emission allowance has not previously been used to 

21 comply with any foreign, international, or domestic 

22 greenhouse gas regulatory program. 

23 ‘‘(2) RETIREMENT.— 

24 ‘‘(A) FOREIGN AND INTERNATIONAL REG25 ULATORY ENTITIES.—The Administrator, in 


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1 consultation with the Secretary of State, shall 

2 seek, by whatever means appropriate, including 

3 agreements and technical cooperation on allow4 ance tracking, to ensure that any relevant for5 eign, international, and domestic regulatory en6 tities— 

7 ‘‘(i) are notified of the use, for pur8 poses of compliance with this title, of any 

9 international emission allowance; and 

10 ‘‘(ii) provide for the disqualification of 

11 such international emission allowance for 

12 any subsequent use under the relevant for13 eign, international, or domestic greenhouse 

14 gas regulatory program, regardless of 

15 whether such use is a sale, exchange, or 

16 submission to satisfy a compliance obliga17 tion. 

18 ‘‘(B) DISQUALIFICATION FROM FURTHER

19 USE.—The Administrator shall ensure that, 

20 once an international emission allowance has 

21 been disqualified or otherwise used for purposes 

22 of compliance with this title, such allowance 

23 shall be disqualified from any further use under 

24 this title. 


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1 ‘‘(d) USE LIMITATIONS.—The Administrator may, by 

2 rule, modify the percentage applicable to international 

3 emission allowances under section 722(d)(3), consistent 

4 with the purposes of the Clean Energy Jobs and American 

5 Power Act. 

6 ‘‘PART D—OFFSETS 

7 ‘‘SEC. 731. OFFSETS INTEGRITY ADVISORY BOARD. 

8 ‘‘(a) ESTABLISHMENT.—Not later than 30 days after 

9 the date of enactment of this title, the President shall es10 tablish an independent Offsets Integrity Advisory Board. 

11 The Advisory Board shall make recommendations to the 

12 President for use in promulgating and revising regulations 

13 under this part, and for ensuring the overall environ14 mental integrity of the programs established pursuant to 

15 those regulations. 

16 ‘‘(b) MEMBERSHIP.—The Advisory Board shall be 

17 comprised of at least nine members. Each member shall 

18 be qualified by education, training, and experience to 

19 evaluate scientific and technical information on matters 

20 referred to the Board under this section. The President 

21 shall appoint Advisory Board members, including a chair 

22 and vice-chair of the Advisory Board. Terms shall be 3 

23 years in length, except for initial terms, which may be up 

24 to 5 years in length to allow staggering. Members may 

25 be reappointed only once for an additional 3-year term, 


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1 and such second term may follow directly after a first 

2 term. 

3 ‘‘(c) ACTIVITIES.—The Advisory Board established 

4 pursuant to subsection (a) shall— 

5 ‘‘(1) provide recommendations, not later than 

6 90 days after the Advisory Board’s establishment 

7 and periodically thereafter, to the President regard8 ing offset project types that should be considered for 

9 eligibility under section 733, taking into consider10 ation relevant scientific and other issues, including— 

11 ‘‘(A) the availability of a representative 

12 data set for use in developing the activity base13 line; 

14 ‘‘(B) the potential for accurate quantifica15 tion of greenhouse gas reduction, avoidance, or 

16 sequestration for an offset project type; 

17 ‘‘(C) the potential level of scientific and 

18 measurement uncertainty associated with an 

19 offset project type; 

20 ‘‘(D) any beneficial or adverse environ21 mental, public health, welfare, social, economic, 

22 or energy effects associated with an offset 

23 project type; 


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1 ‘‘(E) the extent to which, as of the date of 

2 submission of the report, the project or activity 

3 types within each category— 

4 ‘‘(i) are required by law (including a 

5 regulation); or 

6 ‘‘(ii) represent business-as-usual (ab7 sent funding from offset credits) practices 

8 for a relevant land area, industry sector, or 

9 forest, soil or facility type; 

10 ‘‘(2) make available to the President its advice 

11 and comments on offset methodologies that should 

12 be considered under regulations promulgated pursu13 ant to subsection (a) and (b) of section 734, includ14 ing methodologies to address the issues of 

15 additionality, activity baselines, measurement, leak16 age, uncertainty, permanence, and environmental in17 tegrity; 

18 ‘‘(3) make available to the President, and other 

19 relevant Federal agencies, its advice and comments 

20 regarding scientific, technical, and methodological 

21 issues specific to the issuance of international offset 

22 credits under section 744; 

23 ‘‘(4) make available to the President, and other 

24 relevant Federal agencies, its advice and comments 

25 regarding scientific, technical, and methodological 


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1 issues associated with the implementation of this 

2 part; 

3 ‘‘(5) make available to the President its advice 

4 and comments on areas in which further knowledge 

5 is required to appraise the adequacy of existing, re6 vised, or proposed methodologies for use under this 

7 part, and describe the research efforts necessary to 

8 provide the required information; and 

9 ‘‘(6) make available to the President its advice 

10 and comments on other ways to improve or safe11 guard the environmental integrity of programs es12 tablished under this part. 

13 ‘‘(d) SCIENTIFIC REVIEW OF OFFSET AND DEFOR14 ESTATION REDUCTION PROGRAMS.—Not later than Janu15 ary 1, 2017, and at five-year intervals thereafter, the Ad16 visory Board shall submit to the President and make avail17 able to the public an analysis of relevant scientific and 

18 technical information related to this part. The Advisory 

19 Board shall review approved and potential methodologies, 

20 scientific studies, offset project monitoring, offset project 

21 verification reports, and audits related to this part, and 

22 evaluate the net emissions effects of implemented offset 

23 projects. The Advisory Board shall recommend changes to 

24 offset methodologies, protocols, or project types, or to the 

25 overall offset program under this part, to ensure that offVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00487 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 set credits issued by the President do not compromise the 

2 integrity of the annual emission reductions established 

3 under section 703, and to avoid or minimize adverse ef4 fects to human health or the environment. 

5 ‘‘SEC. 732. ESTABLISHMENT OF OFFSETS PROGRAM. 

6 ‘‘(a) REGULATIONS.—Not later than 2 years after 

7 the date of enactment of this title, the President, in con8 sultation with appropriate Federal agencies and taking 

9 into consideration the recommendations of the Advisory 

10 Board, shall promulgate regulations establishing a pro11 gram for the issuance of offset credits in accordance with 

12 the requirements of this part. The President shall periodi13 cally revise these regulations as necessary to meet the re14 quirements of this part. 

15 ‘‘(b) REQUIREMENTS.—The regulations described in 

16 subsection (a) shall— 

17 ‘‘(1) authorize the issuance of offset credits 

18 with respect to qualifying offset projects that result 

19 in reductions or avoidance of greenhouse gas emis20 sions, or sequestration of greenhouse gases; 

21 ‘‘(2) ensure that such offset credits represent 

22 verifiable and additional greenhouse gas emission re23 ductions or avoidance, or increases in sequestration; 


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1 ‘‘(3) ensure that offset credits issued for se2 questration offset projects are only issued for green3 house gas reductions that are permanent; 

4 ‘‘(4) provide for the implementation of the re5 quirements of this part; 

6 ‘‘(5) include as reductions in greenhouse gases 

7 reductions achieved through the destruction of meth8 ane and its conversion to carbon dioxide, and reduc9 tions achieved through destruction of chlorofluoro10 carbons or other ozone depleting substances, if per11 mitted by the President under section 619(b)(9) and 

12 subject to the conditions specified in section 

13 619(b)(9), based on the carbon dioxide equivalent 

14 value of the substance destroyed; and 

15 ‘‘(6) establish a process to accept and respond 

16 to comments from third parties regarding programs 

17 established under this part in a timely manner. 

18 ‘‘(c) COORDINATION TO MINIMIZE NEGATIVE EF19 FECTS.—In promulgating and implementing regulations 

20 under this part, the President shall act (including by re21 jecting projects, if necessary) to avoid or minimize, to the 

22 maximum extent practicable, adverse effects on human 

23 health or the environment resulting from the implementa24 tion of offset projects under this part. 


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1 ‘‘(d) OFFSET REGISTRY.—The President shall estab2 lish within the allowance tracking system established 

3 under section 724(d) an Offset Registry for qualifying off4 set projects and offset credits issued with respect thereto 

5 under this part. 

6 ‘‘(e) LEGAL STATUS OF OFFSET CREDIT.—An offset 

7 credit does not constitute a property right. 

8 ‘‘(f) FEES.—The President shall assess fees payable 

9 by offset project developers in an amount necessary to 

10 cover the administrative costs and the enforcement costs 

11 to the Environmental Protection Agency and the Depart12 ment of Justice of carrying out the activities under this 

13 part. Amounts collected for such fees shall be available 

14 to the President and the Attorney General for carrying 

15 out the activities under this part to the extent provided 

16 in advance in appropriations Acts. 

17 ‘‘SEC. 733. ELIGIBLE PROJECT TYPES. 

18 ‘‘(a) LIST OF ELIGIBLE PROJECT TYPES.— 

19 ‘‘(1) IN GENERAL.—As part of the regulations 

20 promulgated under section 732(a), the President 

21 shall establish, and may periodically revise, a list of 

22 types of projects eligible to generate offset credits, 

23 including international offset credits, under this 

24 part. 


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1 ‘‘(2) ADVISORY BOARD RECOMMENDATIONS.— 

2 In determining the eligibility of project types, the 

3 President shall take into consideration the rec4 ommendations of the Advisory Board. If a list estab5 lished under this section differs from the rec6 ommendations of the Advisory Board, the regula7 tions promulgated under section 732(a) shall include 

8 a justification for the discrepancy. 

9 ‘‘(3) INITIAL DETERMINATION.—The President 

10 shall establish the initial eligibility list under para11 graph (1) not later than one year after the date of 

12 enactment of this title for which there are well devel13 oped methodologies that the President determines 

14 would meet the criteria of section 734. 

15 ‘‘(4) PROJECT TYPES TO BE CONSIDERED FOR

16 INITIAL LIST.—In determining the initial list, the 

17 President shall give priority to consideration of off18 set project types that are recommended by the Advi19 sory Board and for which there are well developed 

20 methodologies that the President determines would 

21 meet the criteria of section 734, and shall con22 sider— 

23 ‘‘(A) methane collection and combustion 

24 projects at active underground coal mines; 


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1 ‘‘(B) methane collection and combustion 

2 projects at landfills; 

3 ‘‘(C) capture of venting, flaring, and fugi4 tive emissions from oil and natural gas systems; 

5 ‘‘(D) nonlandfill methane collection, com6 bustion and avoidance projects involving organic 

7 waste streams that would have otherwise emit8 ted methane in the atmosphere, including ma9 nure management and biogas capture and com10 bustion; 

11 ‘‘(E) projects involving afforestation or re12 forestation of acreage not forested as of Janu13 ary 1, 2009; 

14 ‘‘(F) forest management resulting in an in15 crease in forest carbon stores, including har16 vested wood products; 

17 ‘‘(G) agricultural, grassland, and range18 land sequestration and management practices, 

19 including— 

20 ‘‘(i) altered tillage practices, including 

21 avoided abandonment of such practices; 

22 ‘‘(ii) winter cover cropping, contin23 uous cropping, and other means to in24 crease biomass returned to soil in lieu of 

25 planting followed by fallowing; 


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1 ‘‘(iii) reduction of nitrogen fertilizer 

2 use or increase in nitrogen use efficiency; 

3 ‘‘(iv) reduction in the frequency and 

4 duration of flooding of rice paddies; 

5 ‘‘(v) reduction in carbon emissions 

6 from organic soils; 

7 ‘‘(vi) reduction in greenhouse gas 

8 emissions from manure and effluent; 

9 ‘‘(vii) reduction in greenhouse gas 

10 emissions due to changes in animal man11 agement practices, including dietary modi12 fications; 

13 ‘‘(viii) planting and cultivation of per14 manent tree crops; 

15 ‘‘(ix) greenhouse gas emission reduc16 tions from improvements and upgrades to 

17 mobile or stationary equipment (including 

18 engines); 

19 ‘‘(x) practices to reduce and eliminate 

20 soil tillage; 

21 ‘‘(xi) reductions in greenhouse gas 

22 emissions through restoration of wetlands, 

23 forestland, and grassland; and 


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1 ‘‘(xii) sequestration of greenhouse 

2 gases through management of tree crops; 

3 and 

4 ‘‘(H) changes in carbon stocks attributed 

5 to land use change and forestry activities, in6 cluding— 

7 ‘‘(i) management of peatland or wet8 land; 

9 ‘‘(ii) conservation of grassland and 

10 forested land; 

11 ‘‘(iii) improved forest management, 

12 including accounting for carbon stored in 

13 wood products; 

14 ‘‘(iv) reduced deforestation or avoided 

15 forest conversion; 

16 ‘‘(v) urban tree-planting and mainte17 nance; 

18 ‘‘(vi) agroforestry; and 

19 ‘‘(vii) adaptation of plant traits or 

20 new technologies that increase sequestra21 tion by forests. 

22 ‘‘(5) METHODOLOGIES.—In issuing methodolo23 gies pursuant to section 734, the President shall 

24 give priority to methodologies for offset types in25 cluded on the initial eligibility list. 


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1 ‘‘(b) MODIFICATION OF LIST.—The President— 

2 ‘‘(1) shall add additional project types to the 

3 list not later than 2 years after the date of enact4 ment of this title; 

5 ‘‘(2) may at any time, by rule, add a project 

6 type to the list established under subsection (a) if 

7 the President, in consultation with appropriate Fed8 eral agencies and taking into consideration the rec9 ommendations of the Advisory Board, determines 

10 that the project type can generate additional reduc11 tions or avoidance of greenhouse gas emissions, or 

12 sequestration of greenhouse gases, subject to the re13 quirements of this part; 

14 ‘‘(3) may at any time, by rule, determine that 

15 a project type on the list does not meet the require16 ments of this part, and remove a project type from 

17 the list established under subsection (a), in consulta18 tion with appropriate Federal agencies and taking 

19 into consideration any recommendations of the Advi20 sory Board; and 

21 ‘‘(4) shall consider adding to or removing from 

22 the list established under subsection (a), at a min23 imum, project types proposed to the President— 

24 ‘‘(A) by petition pursuant to subsection 

25 (c); or 


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1 ‘‘(B) by the Advisory Board. 

2 ‘‘(c) PETITION PROCESS.—Any person may petition 

3 the President to modify the list established under sub4 section (a) by adding or removing a project type pursuant 

5 to subsection (b). Any such petition shall include a show6 ing by the petitioner that there is adequate data to estab7 lish that the project type does or does not meet the re8 quirements of this part. Not later than 12 months after 

9 receipt of such a petition, the President shall either grant 

10 or deny the petition and publish a written explanation of 

11 the reasons for the President’s decision. The President 

12 may not deny a petition under this subsection on the basis 

13 of inadequate Environmental Protection Agency resources 

14 or time for review. 

15 ‘‘SEC. 734. REQUIREMENTS FOR OFFSET PROJECTS. 

16 ‘‘(a) METHODOLOGIES.—As part of the regulations 

17 promulgated under section 732(a), the President shall es18 tablish, for each type of offset project listed as eligible 

19 under section 733, the following: 

20 ‘‘(1) ADDITIONALITY.—A standardized method21 ology for determining the additionality of greenhouse 

22 gas emission reductions or avoidance, or greenhouse 

23 gas sequestration, achieved by an offset project of 

24 that type. Such methodology shall ensure, at a min25 imum, that any greenhouse gas emission reduction 


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1 or avoidance, or any greenhouse gas sequestration, is 

2 considered additional only to the extent that it re3 sults from activities that— 

4 ‘‘(A) are not required by or undertaken to 

5 comply with any law, including any regulation 

6 or consent order; 

7 ‘‘(B) were not commenced prior to Janu8 ary 1, 2009, except in the case of— 

9 ‘‘(i) offset project activities that com10 menced after January 1, 2001, and were 

11 registered as of the date of enactment of 

12 this title under an offset program with re13 spect to which the President has made an 

14 affirmative determination under section 

15 740(a)(2); or 

16 ‘‘(ii) activities that are readily revers17 ible, with respect to which the President 

18 may set an alternative earlier date under 

19 this subparagraph that is not earlier than 

20 January 1, 2001, where the President de21 termines that setting such an alternative 

22 date may produce an environmental benefit 

23 by removing an incentive to cease and then 

24 reinitiate activities that began prior to 

25 January 1, 2009; 


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1 ‘‘(C) are not receiving support under sec2 tion 323 of division A, or section 207 of divi3 sion B, of the Clean Energy Jobs and American 

4 Power Act; and 

5 ‘‘(D) exceed the activity baseline estab6 lished under paragraph (2). 

7 ‘‘(2) ACTIVITY BASELINES.—A standardized 

8 methodology for establishing activity baselines for 

9 offset projects of that type. The President shall set 

10 activity baselines to reflect a conservative estimate of 

11 business-as-usual performance or practices for the 

12 relevant type of activity such that the baseline pro13 vides an adequate margin of safety to ensure the en14 vironmental integrity of offsets calculated in ref15 erence to such baseline. 

16 ‘‘(3) QUANTIFICATION METHODS.—A standard17 ized methodology for determining the extent to 

18 which greenhouse gas emission reductions or avoid19 ance, or greenhouse gas sequestration, achieved by 

20 an offset project of that type exceed a relevant activ21 ity baseline, including protocols for monitoring and 

22 accounting for uncertainty. 

23 ‘‘(4) LEAKAGE.—A standardized methodology 

24 for accounting for and mitigating potential leakage, 


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1 if any, from an offset project of that type, taking 

2 uncertainty into account. 

3 ‘‘(b) ACCOUNTING FOR REVERSALS.— 

4 ‘‘(1) IN GENERAL.—As part of the regulations 

5 promulgated under section 732(a), for each type of 

6 sequestration project listed under section 733, the 

7 President shall establish requirements to account for 

8 and address reversals, including— 

9 ‘‘(A) a requirement to report any reversal 

10 with respect to an offset project for which offset 

11 credits have been issued under this part; 

12 ‘‘(B) provisions to require emission allow13 ances to be held in amounts to fully compensate 

14 for greenhouse gas emissions attributable to re15 versals, and to assign responsibility for holding 

16 such emission allowances; 

17 ‘‘(C) provisions to discourage repeated in18 tentional reversals by offset project developers, 

19 including but not limited to the assessment of 

20 administrative fees, temporary suspension, or 

21 disqualification of an offset project developer 

22 from the program; and 

23 ‘‘(D) any other provisions the President 

24 determines necessary to account for and ad25 dress reversals. 


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1 ‘‘(2) MECHANISMS.—The President shall pre2 scribe mechanisms to ensure that any sequestration 

3 with respect to which an offset credit is issued under 

4 this part results in a permanent net increase in se5 questration, and that full account is taken of any ac6 tual or potential reversal of such sequestration, with 

7 an adequate margin of safety. The President shall 

8 prescribe at least one of the following mechanisms to 

9 meet the requirements of this paragraph: 

10 ‘‘(A) An offsets reserve, pursuant to para11 graph (3). 

12 ‘‘(B) Insurance that provides for purchase 

13 and provision to the President for retirement of 

14 an amount of offset credits or emission allow15 ances equal in number to the tons of carbon di16 oxide equivalents of greenhouse gas emissions 

17 released due to reversal. 

18 ‘‘(C) Another mechanism that the Presi19 dent determines satisfies the requirements of 

20 this part. 

21 ‘‘(3) OFFSETS RESERVE.— 

22 ‘‘(A) IN GENERAL.—An offsets reserve re23 ferred to in paragraph (2)(A) is a program 

24 under which, before issuance of offset credits 

25 under this part, the President shall subtract 


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1 and reserve from the quantity to be issued a 

2 quantity of offset credits based on the risk of 

3 reversal. The President shall— 

4 ‘‘(i) hold these reserved offset credits 

5 in the offsets reserve; and 

6 ‘‘(ii) register the holding of the re7 served offset credits in the Offset Registry 

8 established under section 732(d). 

9 ‘‘(B) PROJECT REVERSAL.— 

10 ‘‘(i) IN GENERAL.—If a reversal has 

11 occurred with respect an offset project for 

12 which offset credits are reserved under this 

13 paragraph, the President shall remove off14 set credits or emission allowances from the 

15 offsets reserve and cancel them to fully ac16 count for the tons of carbon dioxide equiv17 alent that are no longer sequestered. 

18 ‘‘(ii) INTENTIONAL REVERSALS.—If 

19 the President determines that a reversal 

20 was intentional, the offset project developer 

21 for the relevant offset project shall place 

22 into the offsets reserve a quantity of offset 

23 credits, or combination of offset credits 

24 and emission allowances, equal in number 

25 to the number of reserve offset credits that 


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1 were canceled due to the reversal pursuant 

2 to clause (i). 

3 ‘‘(iii) UNINTENTIONAL REVERSALS.— 

4 If the President determines that a reversal 

5 was unintentional, the offset project devel6 oper for the relevant offset project shall 

7 place into the offsets reserve a quantity of 

8 offset credits, or combination of offset 

9 credits and emission allowances, equal in 

10 number to half the number of offset credits 

11 that were reserved for that offset project, 

12 or half the number of reserve offset credits 

13 that were canceled due to the reversal pur14 suant to clause (i), whichever is less. 

15 ‘‘(iv) PETITION.—Any person may pe16 tition the President for a determination 

17 that an offsets reversal has occurred. Any 

18 such petition shall include a showing by 

19 the petitioner that there is adequate data 

20 or other evidence to support the petition. 

21 Not later than 90 days after the date of 

22 receipt of the petition, the President shall 

23 take final action determining either that 

24 the reversal has occurred or that the rever25 sal has not occurred. Such determination 


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1 shall be accompanied by a statement of the 

2 basis for the determination. 

3 ‘‘(C) USE OF RESERVED OFFSET CRED4 ITS.—Offset credits placed into the offsets re5 serve under this paragraph may not be used to 

6 comply with section 722. 

7 ‘‘(4) TERM OFFSET CREDITS.— 

8 ‘‘(A) APPLICABILITY.—With respect to a 

9 practice listed under section 733 that seques10 ters greenhouse gases and has a crediting pe11 riod of not more than 5 years, the President 

12 may address reversals pursuant to this para13 graph in lieu of permanently accounting for re14 versals pursuant to paragraphs (1) and (2). 

15 ‘‘(B) ACCOUNTING FOR REVERSALS.—For 

16 such practices or projects implementing the 

17 practices described in subparagraph (A), the 

18 President shall require only reversals that occur 

19 during the crediting period to be accounted for 

20 and addressed pursuant to paragraphs (1) and 

21 (2). 

22 ‘‘(C) CREDITS ISSUED.—For practices or 

23 projects regulated pursuant to subparagraph 

24 (B), the Secretary shall issue under section 737 

25 a term offset credit, in lieu of an offset credit, 


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1 for each ton of carbon dioxide equivalent that 

2 has been sequestered. 

3 ‘‘(c) CREDITING PERIODS.— 

4 ‘‘(1) IN GENERAL.—As part of the regulations 

5 promulgated under section 732(a), for each offset 

6 project type, the President shall specify a crediting 

7 period, and establish provisions for petitions for new 

8 crediting periods, in accordance with this subsection. 

9 ‘‘(2) DURATION.— 

10 ‘‘(A) IN GENERAL.—The crediting period 

11 shall be not less than 5 and not greater than 

12 10 years for any project type other than those 

13 involving sequestration or term offsets. 

14 ‘‘(B) FORESTRY PROJECTS.—The crediting 

15 period for a forestry offset project shall not ex16 ceed 20 years. 

17 ‘‘(C) TERM OFFSET CREDITS.—The cred18 iting period for a term offset credit issued shall 

19 not exceed 5 years. 

20 ‘‘(3) ELIGIBILITY.—An offset project shall be 

21 eligible to generate offset credits under this part 

22 only during the project’s crediting period. During 

23 such crediting period, the project shall remain eligi24 ble to generate offset credits, subject to the meth25 odologies and project type eligibility list that applied 


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1 as of the date of project approval under section 735, 

2 except as provided in paragraph (4). 

3 ‘‘(4) PETITION FOR NEW CREDITING PERIOD.— 

4 An offset project developer may petition for a new 

5 crediting period to commence after termination of a 

6 crediting period, subject to the methodologies and 

7 project type eligibility list in effect at the time when 

8 such petition is submitted. A petition may not be 

9 submitted under this paragraph more than 18 

10 months before the end of the pending crediting pe11 riod. The President may grant such petition after 

12 public notice and opportunity for comment. The 

13 President may limit the number of new crediting pe14 riods available for projects of particular project 

15 types. 

16 ‘‘(d) ENVIRONMENTAL INTEGRITY.—In establishing 

17 the requirements under this section, the President shall 

18 apply conservative assumptions or methods to maximize 

19 the certainty that the environmental integrity of the green20 house gas limitations established under section 703 is not 

21 compromised. 

22 ‘‘(e) PRE-EXISTING METHODOLOGIES.—In promul23 gating requirements under this section, the President shall 

24 give due consideration to methodologies for offset projects 

25 existing as of the date of enactment of this title. 


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1 ‘‘(f) ADDED PROJECT TYPES.—The President shall 

2 establish methodologies described in subsection (a), and, 

3 as applicable, requirements and mechanisms for reversals 

4 as described in subsection (b), for any project type that 

5 is added to the list pursuant to section 733. 

6 ‘‘SEC. 735. APPROVAL OF OFFSET PROJECTS. 

7 ‘‘(a) APPROVAL PETITION.—An offset project devel8 oper shall submit an offset project approval petition signed 

9 by a responsible official (who shall certify the accuracy of 

10 the information submitted) and providing such informa11 tion as the President requires to determine whether the 

12 offset project is eligible for issuance of offset credits under 

13 rules promulgated pursuant to this part. 

14 ‘‘(b) TIMING.—An approval petition shall be sub15 mitted to the President under subsection (a) not later than 

16 the time at which an offset project’s first verification re17 port is submitted under section 736. 

18 ‘‘(c) APPROVAL PETITION REQUIREMENTS.—As part 

19 of the regulations promulgated under section 732, the 

20 President shall include provisions for, and shall specify, 

21 the required components of an offset project approval peti22 tion required under subsection (a), which shall include— 

23 ‘‘(1) designation of an offset project developer; 


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1 ‘‘(2) designation of a party who is authorized to 

2 provide access to the appropriate officials or an au3 thorized representative to the offset project; and 

4 ‘‘(3) any other information that the President 

5 considers to be necessary to achieve the purposes of 

6 this part. 

7 ‘‘(d) APPROVAL AND NOTIFICATION.—Not later than 

8 90 days after receiving a complete approval petition under 

9 subsection (a), the President shall make the approval peti10 tion publicly available on the internet, approve or deny the 

11 petition in writing, and, if the petition is denied, make 

12 the President’s decision publicly available on the internet. 

13 After an offset project is approved, the offset project de14 veloper shall not be required to resubmit an approval peti15 tion during the offset project’s crediting period, except as 

16 provided in section 734(c)(4). 

17 ‘‘(e) APPEAL.—The President shall establish proce18 dures for appeal and review of determinations made under 

19 subsection (d). 

20 ‘‘(f) VOLUNTARY PREAPPROVAL REVIEW.—The 

21 President may establish a voluntary preapproval review 

22 procedure, to allow an offset project developer to request 

23 the President to conduct a preliminary eligibility review 

24 for an offset project. Findings of such reviews shall not 


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1 be binding upon the President. The voluntary preapproval 

2 review procedure— 

3 ‘‘(1) shall require the offset project developer to 

4 submit such basic project information as the Presi5 dent requires to provide a meaningful review; and 

6 ‘‘(2) shall require a response from the President 

7 not later than 6 weeks after receiving a request for 

8 review under this subsection. 

9 ‘‘SEC. 736. VERIFICATION OF OFFSET PROJECTS. 

10 ‘‘(a) IN GENERAL.—As part of the regulations pro11 mulgated under section 732(a), the President shall estab12 lish requirements, including protocols, for verification of 

13 the quantity of greenhouse gas emission reductions or 

14 avoidance, or sequestration of greenhouse gases, resulting 

15 from an offset project. The regulations shall require that 

16 an offset project developer shall submit a report, prepared 

17 by a third-party verifier accredited under subsection (d), 

18 providing such information as the President requires to 

19 determine the quantity of greenhouse gas emission reduc20 tions or avoidance, or sequestration of greenhouse gas, re21 sulting from the offset project. 

22 ‘‘(b) SCHEDULE.—The President shall prescribe a 

23 schedule for the submission of verification reports under 

24 subsection (a). 


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1 ‘‘(c) VERIFICATION REPORT REQUIREMENTS.—The 

2 President shall specify the required components of a 

3 verification report required under subsection (a), which 

4 shall include— 

5 ‘‘(1) the name and contact information for a 

6 designated representative for the offset project devel7 oper; 

8 ‘‘(2) the quantity of greenhouse gas reduced, 

9 avoided, or sequestered; 

10 ‘‘(3) the methodologies applicable to the project 

11 pursuant to section 734; 

12 ‘‘(4) a certification that the project meets the 

13 applicable requirements; 

14 ‘‘(5) a certification establishing that the conflict 

15 of interest requirements in the regulations promul16 gated under subsection (d)(1) have been complied 

17 with; and 

18 ‘‘(6) any other information that the President 

19 considers to be necessary to achieve the purposes of 

20 this part. 

21 ‘‘(d) VERIFIER ACCREDITATION.— 

22 ‘‘(1) IN GENERAL.—As part of the regulations 

23 promulgated under section 732(a), the President 

24 shall establish a process and requirements for peri25 odic accreditation of third-party verifiers to ensure 


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1 that such verifiers are professionally qualified and 

2 have no conflicts of interest with offset project devel3 opers. 

4 ‘‘(2) STANDARDS.— 

5 ‘‘(A) AMERICAN NATIONAL STANDARDS IN6 STITUTE ACCREDITATION.—The President may 

7 accredit, or accept for purposes of accreditation 

8 under this subsection, verifiers accredited under 

9 the American National Standards Institute 

10 (ANSI) accreditation program in accordance 

11 with ISO 14065. The President shall accredit, 

12 or accept for accreditation, verifiers under this 

13 subparagraph only if the President finds that 

14 the American National Standards Institute ac15 creditation program provides sufficient assur16 ance that the requirements of this part will be 

17 met. 

18 ‘‘(B) EPA ACCREDITATION.—As part of 

19 the regulations promulgated under section 

20 732(a), the President may establish accredita21 tion standards for verifiers under this sub22 section, and may establish related training and 

23 testing programs and requirements. 

24 ‘‘(3) PUBLIC ACCESSIBILITY.—Each verifier 

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1 cordance with this subsection shall be listed in a 

2 publicly accessible database, which shall be main3 tained and updated by the President. 

4 ‘‘(4) REVOCATION.—The regulations concerning 

5 accreditation of third-party verifiers required under 

6 paragraph (1) shall establish a process for the Presi7 dent to revoke the accreditation of any third-party 

8 verifier that the President finds fails to maintain 

9 professional qualifications or to avoid a conflict of 

10 interest, or for other good cause. 

11 ‘‘SEC. 737. ISSUANCE OF OFFSET CREDITS. 

12 ‘‘(a) DETERMINATION AND NOTIFICATION.—Not 

13 later than 90 days after receiving a complete verification 

14 report under section 736, the President shall— 

15 ‘‘(1) make the report publicly available on the 

16 Internet; 

17 ‘‘(2) make a determination of the quantity of 

18 greenhouse gas emissions reduced or avoided, or 

19 greenhouse gases sequestered, resulting from an off20 set project approved under section 735; and 

21 ‘‘(3) notify the offset project developer in writ22 ing of such determination and make such determina23 tion publicly available on the Internet. 

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1 oper for each ton of carbon dioxide equivalent that the 

2 President has determined has been reduced, avoided, or 

3 sequestered during the period covered by a verification re4 port submitted in accordance with section 736, only if— 

5 ‘‘(1) the President has approved the offset 

6 project pursuant to section 735; and 

7 ‘‘(2) the relevant emissions reduction, avoid8 ance, or sequestration has— 

9 ‘‘(A) already occurred, during the offset 

10 project’s crediting period; and 

11 ‘‘(B) occurred after January 1, 2009. 

12 ‘‘(c) APPEAL.—The President shall establish proce13 dures for appeal and review of determinations made under 

14 subsection (a). 

15 ‘‘(d) TIMING.—Offset credits meeting the criteria es16 tablished in subsection (b) shall be issued not later than 

17 2 weeks following the verification determination made by 

18 the President under subsection (a). 

19 ‘‘(e) REGISTRATION.—The President shall assign a 

20 unique serial number to and register each offset credit to 

21 be issued in the Offset Registry established under section 

22 732(d). 

23 ‘‘SEC. 738. AUDITS. 

24 ‘‘(a) IN GENERAL.—The President shall, on an ongo25 ing basis, conduct random audits of offset projects and 


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1 offset credits. The President shall conduct audits of the 

2 practices of third-party verifiers. In each year, the Presi3 dent shall conduct audits, at minimum, for a representa4 tive sample of project types and geographic areas. 

5 ‘‘(b) DELEGATION.—The President may delegate to 

6 a State or tribal government the responsibility for con7 ducting audits under this section if the President finds 

8 that the program proposed by the State or tribal govern9 ment provides assurances equivalent to those provided by 

10 the auditing program of the President, and that the integ11 rity of the offset program under this part will be main12 tained. Nothing in this subsection shall prevent the Presi13 dent from conducting any audit the President considers 

14 necessary and appropriate. 

15 ‘‘(c) AUDIT REQUIREMENTS.—As part of the regula16 tions promulgated under section 732(a), the appropriate 

17 officials shall establish requirements and protocols for an 

18 auditing program, whether undertaken by the appropriate 

19 officials or an authorized representative, concerning 

20 project developers, third-party verifiers, and various com21 ponents of the offsets program. Such regulations shall in22 clude— 

23 ‘‘(1) the components of the offset project, which 

24 shall be evaluated against the offset approval peti25 tion and the verification report; 


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1 ‘‘(2) the minimum experience or training of the 

2 auditors; 

3 ‘‘(3) the form in which reports shall be com4 pleted; 

5 ‘‘(4) requirements for delegating auditing func6 tions to States or tribal governments, including re7 quiring periodic reports from State or tribal govern8 ments on their auditing activities and findings; and 

9 ‘‘(5) any other information that the appropriate 

10 officials considers to be necessary to achieve the pur11 pose of the Act. 

12 ‘‘SEC. 739. PROGRAM REVIEW AND REVISION. 

13 ‘‘At least once every 5 years, the President shall re14 view and, based on new or updated information and taking 

15 into consideration the recommendations of the Advisory 

16 Board, update and revise— 

17 ‘‘(1) the list of eligible project types established 

18 under section 733; 

19 ‘‘(2) the methodologies established, including 

20 specific activity baselines, under section 734(a); 

21 ‘‘(3) the reversal requirements and mechanisms 

22 established or prescribed under section 734(b); 

23 ‘‘(4) measures to improve the accountability of 

24 the offsets program; and 


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1 ‘‘(5) any other requirements established under 

2 this part to ensure the environmental integrity and 

3 effective operation of this part. 

4 ‘‘SEC. 740. EARLY OFFSET SUPPLY. 

5 ‘‘(a) PROJECTS REGISTERED UNDER OTHER GOV6 ERNMENT-RECOGNIZED PROGRAMS.—Except as provided 

7 in subsection (b) or (c), after public notice and oppor8 tunity for comment, the President shall issue one offset 

9 credit for each ton of carbon dioxide equivalent emissions 

10 reduced, avoided, or sequestered— 

11 ‘‘(1) under an offset project that was started 

12 after January 1, 2001; 

13 ‘‘(2) for which a credit was issued under any 

14 regulatory or voluntary greenhouse gas emission off15 set program that the President determines— 

16 ‘‘(A) was established under State or tribal 

17 law or regulation prior to January 1, 2009, or 

18 has been approved by the President pursuant to 

19 subsection (e); 

20 ‘‘(B) has developed offset project type 

21 standards, methodologies, and protocols 

22 through a public consultation process or a peer 

23 review process; 

24 ‘‘(C) has made available to the public 

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1 quire that credited emission reductions, avoid2 ance, or sequestration are permanent, addi3 tional, verifiable, and enforceable; 

4 ‘‘(D) requires that all emission reductions, 

5 avoidance, or sequestration be verified by a 

6 State regulatory agency or an accredited third7 party independent verification body; 

8 ‘‘(E) requires that all credits issued are 

9 registered in a publicly accessible registry, with 

10 individual serial numbers assigned for each ton 

11 of carbon dioxide equivalent emission reduc12 tions, avoidance, or sequestration; and 

13 ‘‘(F) ensures that no credits are issued for 

14 activities for which the entity administering the 

15 program, or a program administrator or rep16 resentative, has funded, solicited, or served as a 

17 fund administrator for the development of, the 

18 project or activity that caused the emission re19 duction, avoidance, or sequestration; and 

20 ‘‘(3) for which the credit described in para21 graph (2) is transferred to the President. 

22 ‘‘(b) INELIGIBLE CREDITS.—Subsection (a) shall not 

23 apply to offset credits that have expired or have been re24 tired, canceled, or used for compliance under a program 

25 established under State or tribal law or regulation. 


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1 ‘‘(c) LIMITATION.—Notwithstanding subsection 

2 (a)(1), offset credits shall be issued under this section— 

3 ‘‘(1) only for reductions or avoidance of green4 house gas emissions, or sequestration of greenhouse 

5 gases, that occur after January 1, 2009; and 

6 ‘‘(2) only until the date that is 3 years after the 

7 date of enactment of this title, or the date that regu8 lations promulgated under section 732(a) take ef9 fect, whichever occurs sooner. 

10 ‘‘(d) RETIREMENT OF CREDITS.—The President 

11 shall seek to ensure that offset credits described in sub12 section (a)(2) are retired for purposes of use under a pro13 gram described in subsection (b). 

14 ‘‘(e) OTHER PROGRAMS.— 

15 ‘‘(1) IN GENERAL.—Offset programs that ei16 ther— 

17 ‘‘(A) were not established under State or 

18 tribal law; or 

19 ‘‘(B) were not established prior to January 

20 1, 2009; 

21 but that otherwise meet all of the criteria of sub22 section (a)(2) may apply to the President to be ap23 proved under this subsection as an eligible program 

24 for early offset credits under this section. 


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1 ‘‘(2) APPROVAL.—The President shall approve 

2 any such program that the President determines has 

3 criteria and methodologies of at least equal strin4 gency to the criteria and methodologies of the pro5 grams established under State or tribal law that the 

6 President determines meet the criteria of subsection 

7 (a)(2). The President may approve types of offsets 

8 under any such program that are subject to criteria 

9 and methodologies of at least equal stringency to the 

10 criteria and methodologies for such types of offsets 

11 applied under the programs established under State 

12 or tribal law that the President determines meet the 

13 criteria of subsection (a)(2). The President shall 

14 make a determination on any application received 

15 under this subsection by not later than 180 days 

16 from the date of receipt of the application. 

17 ‘‘SEC. 741. ENVIRONMENTAL CONSIDERATIONS. 

18 ‘‘If the President lists forestry or other relevant land 

19 management-related offset projects as eligible offset 

20 project types under section 733, the President, in con21 sultation with appropriate Federal agencies, shall promul22 gate regulations to establish criteria for such offset 

23 projects— 

24 ‘‘(1) to ensure that native species are given pri25 mary consideration in such projects; 


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1 ‘‘(2) to enhance biological diversity in such 

2 projects; 

3 ‘‘(3) to prohibit the use of federally designated 

4 or State-designated noxious weeds; 

5 ‘‘(4) to prohibit the use of a species listed by 

6 a regional or State invasive plant authority within 

7 the applicable region or State; 

8 ‘‘(5) in the case of forestry offset projects, in 

9 accordance with widely accepted, environmentally 

10 sustainable forestry practices; 

11 ‘‘(6) to ensure that the offset project area was 

12 not converted from native ecosystems, such as a for13 est, grassland, scrubland or wetland, to generate off14 sets, unless such conversation took place at least 10 

15 years prior to the date of enactment of this title or 

16 before January 1, 2009, whichever date is earlier; 

17 and 

18 ‘‘(7) to the maximum extent practicable, ensure 

19 that the use of offset credits would be eligible to sat20 isfy emission reduction commitments made by the 

21 United States in multilateral agreements, such as 

22 the United Nations Framework Convention on Cli23 mate Change, done at New York on May 9, 1992 (or 

24 any successor agreement). 


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1 ‘‘SEC. 742. TRADING. 

2 ‘‘Section 724 shall apply to the trading of offset cred3 its. 

4 ‘‘SEC. 743. OFFICE OF OFFSETS INTEGRITY. 

5 ‘‘(a) ESTABLISHMENT.—There is established within 

6 the Office of the Assistant Attorney General of the Envi7 ronment and Natural Resources Division in the Depart8 ment of Justice a Carbon Offsets Integrity Unit, to be 

9 headed by a Special Counsel (hereinafter referred to as 

10 the ‘Special Counsel’). The Carbon Offsets Integrity Unit 

11 and the Special Counsel shall be responsible to and shall 

12 report directly to the Assistant Attorney General of the 

13 Environment and Natural Resources Division. 

14 ‘‘(b) APPOINTMENT.—The Special Counsel shall be 

15 appointed by the President, by and with the advice and 

16 consent of the Senate. 

17 ‘‘(c) RESPONSIBILITIES.—The Special Counsel 

18 shall— 

19 ‘‘(1) supervise and coordinate investigations 

20 and civil enforcement within the Department of Jus21 tice of the carbon offsets program under this part; 

22 ‘‘(2) ensure that Federal law relating to civil 

23 enforcement of the carbon offsets program is used to 

24 the fullest extent authorized; and 


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1 ‘‘(3) ensure that adequate resources are made 

2 available for the investigation and enforcement of 

3 civil violations of the carbon offsets program. 

4 ‘‘(d) COMPENSATION.—The Special Counsel shall be 

5 paid at the basic pay payable for level V of the Executive 

6 Schedule under section 5316 of title 5, United States 

7 Code. 

8 ‘‘(e) ASSIGNMENT OF PERSONNEL.—There shall be 

9 assigned to the Carbon Offsets Integrity Unit such per10 sonnel as the Attorney General determines to be necessary 

11 to provide an appropriate level of enforcement activity in 

12 the area of carbon offsets. 

13 ‘‘SEC. 744. INTERNATIONAL OFFSET CREDITS. 

14 ‘‘(a) IN GENERAL.—The Administrator, in consulta15 tion with the Secretary of State and the Administrator 

16 of the United States Agency for International Develop17 ment, may issue, in accordance with this section, inter18 national offset credits based on activities that reduce or 

19 avoid greenhouse gas emissions, or increase sequestration 

20 of greenhouse gases, in a developing country. Such credits 

21 may be issued for projects pursuant to the requirements 

22 of this part or as provided in subsection (c), (d), or (e). 

23 ‘‘(b) ISSUANCE.— 

24 ‘‘(1) REGULATIONS.—Not later than 2 years 

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1 istrator, in consultation with the Secretary of State, 

2 the Administrator of the United States Agency for 

3 International Development, and any other appro4 priate Federal agency, and taking into consideration 

5 the recommendations of the Advisory Board, shall 

6 promulgate regulations for implementing this sec7 tion, taking into consideration specific factors rel8 evant to the determination of eligible international 

9 offset project types and the implementation of inter10 national methodologies for each offset type ap11 proved. Except as otherwise provided in this section, 

12 the issuance of international offset credits under this 

13 section shall be subject to the requirements of this 

14 part. 

15 ‘‘(2) REQUIREMENTS FOR INTERNATIONAL

16 OFFSET CREDITS.—The Administrator may issue 

17 international offset credits only if— 

18 ‘‘(A) the United States is a party to a bi19 lateral or multilateral agreement or arrange20 ment that includes the country in which the 

21 project or measure achieving the relevant green22 house gas emission reduction or avoidance, or 

23 greenhouse gas sequestration, has occurred; 

24 ‘‘(B) such country is a developing country; 

25 and 


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1 ‘‘(C) such agreement or arrangement— 

2 ‘‘(i) ensures that all of the require3 ments of this part apply to the issuance of 

4 international offset credits under this sec5 tion; 

6 ‘‘(ii) provides for the appropriate dis7 tribution of international offset credits 

8 issued; and 

9 ‘‘(iii) provides that the offset project 

10 developer be eligible to receive service of 

11 process in the United States for the pur12 pose of all civil and regulatory actions in 

13 Federal courts, if such service is made in 

14 accordance with the Federal rules for serv15 ice of process in the States in which the 

16 case or regulatory action is brought. 

17 ‘‘(3) SUPPLEMENTAL INTERNATIONAL OFFSET

18 CATEGORIES.— 

19 ‘‘(A) IN GENERAL.—In order to ensure a 

20 sufficient supply of international offsets and to 

21 reduce the cost of compliance with this title, the 

22 Administrator may establish categories of inter23 national offsets in addition to those described in 

24 subsections (c), (d), and (e), if— 


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1 ‘‘(i) for 2 consecutive years, the auc2 tion price for allowances reaches the mar3 ket stability reserve auction price under 

4 section 726(c); and 

5 ‘‘(ii) the Administrator determines 

6 that the total amount of international off7 sets held by covered entities for each of the 

8 2 years referred to in clause (i) does not 

9 exceed the limit on international offsets es10 tablished under section 722(d)(3). 

11 ‘‘(B) SUPPLEMENTAL CATEGORIES.— 

12 ‘‘(i) IN GENERAL.—Any supplemental 

13 categories of international offsets estab14 lished pursuant to subparagraph (A) 

15 shall— 

16 ‘‘(I) satisfy all applicable provi17 sions of this part, including subsection 

18 (b)(2) of this section and sections 733 

19 and 734; and 

20 ‘‘(II) meet the criteria described 

21 in clause (ii). 

22 ‘‘(ii) CRITERIA.—The criteria referred 

23 to in clause (i)(II) are that— 

24 ‘‘(I) the country in which the ac25 tivities in the offset category would 


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1 take place has developed and is imple2 menting a low carbon development 

3 plan that includes provisions for the 

4 activities described in the offset cat5 egory; 

6 ‘‘(II) the activities in the offset 

7 category are not activities included 

8 under subsection (c), (d) or (e); and 

9 ‘‘(III) the activities in the offset 

10 category satisfy specific criteria rel11 evant to methodologies and institu12 tional and technical capacities associ13 ated with developing country contexts 

14 to ensure adequate treatment of leak15 age, additionality, and permanence. 

16 ‘‘(c) SECTOR-BASED CREDITS.— 

17 ‘‘(1) IN GENERAL.—In order to minimize the 

18 potential for leakage and to encourage countries to 

19 take nationally appropriate mitigation actions to re20 duce or avoid greenhouse gas emissions, or sequester 

21 greenhouse gases, the Administrator, in consultation 

22 with the Secretary of State and the Administrator of 

23 the United States Agency for International Develop24 ment, shall— 


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1 ‘‘(A) identify sectors, or combinations of 

2 sectors, within specific countries with respect to 

3 which the issuance of international offset cred4 its on a sectoral basis is appropriate; and 

5 ‘‘(B) issue international offset credits for 

6 such sectors only on a sectoral basis. 

7 ‘‘(2) IDENTIFICATION OF SECTORS.— 

8 ‘‘(A) GENERAL RULE.—For purposes of 

9 paragraph (1)(A), a sectoral basis shall be ap10 propriate for activities— 

11 ‘‘(i) in countries that have compara12 tively high greenhouse gas emissions, or 

13 comparatively greater levels of economic 

14 development; and 

15 ‘‘(ii) that, if located in the United 

16 States, would be within a sector subject to 

17 the compliance obligation under section 

18 722. 

19 ‘‘(B) FACTORS.—In determining the sec20 tors and countries for which international offset 

21 credits should be awarded only on a sectoral 

22 basis, the Administrator, in consultation with 

23 the Secretary of State and the Administrator of 

24 the United States Agency for International De25 velopment, shall consider the following factors: 


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1 ‘‘(i) The country’s gross domestic 

2 product. 

3 ‘‘(ii) The country’s total greenhouse 

4 gas emissions. 

5 ‘‘(iii) Whether the comparable sector 

6 of the United States economy is covered by 

7 the compliance obligation under section 

8 722. 

9 ‘‘(iv) The heterogeneity or homo10 geneity of sources within the relevant sec11 tor. 

12 ‘‘(v) Whether the relevant sector pro13 vides products or services that are sold in 

14 internationally competitive markets. 

15 ‘‘(vi) The risk of leakage if inter16 national offset credits were issued on a 

17 project-level basis, instead of on a sectoral 

18 basis, for activities within the relevant sec19 tor. 

20 ‘‘(vii) The capability of accurately 

21 measuring, monitoring, reporting, and 

22 verifying the performance of sources across 

23 the relevant sector. 

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1 retary of State and the Administrator of 

2 the United States Agency for International 

3 Development, determines are appropriate 

4 to— 

5 ‘‘(I) ensure the integrity of the 

6 United States greenhouse gas emis7 sions limitations established under 

8 section 703; and 

9 ‘‘(II) encourage countries to take 

10 nationally appropriate mitigation ac11 tions to reduce or avoid greenhouse 

12 gas emissions, or sequester green13 house gases. 

14 ‘‘(ix) The issuance of offsets for ac15 tivities that are— 

16 ‘‘(I) in addition to nationally ap17 propriate mitigation actions taken by 

18 developing countries pursuant to the 

19 low-carbon development plans of the 

20 countries; and 

21 ‘‘(II) on a sectoral basis. 

22 ‘‘(3) SECTORAL BASIS.— 

23 ‘‘(A) DEFINITION.—In this subsection, the 

24 term ‘sectoral basis’ means the issuance of 

25 international offset credits only for the quantity 


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1 of sector-wide reductions or avoidance of green2 house gas emissions, or sector-wide increases in 

3 sequestration of greenhouse gases, achieved 

4 across the relevant sector or sectors of the econ5 omy relative to a baseline level of emissions es6 tablished in an agreement or arrangement de7 scribed in subsection (b)(2)(A) for the sector. 

8 ‘‘(B) BASELINE.—The baseline for a sec9 tor shall— 

10 ‘‘(i) be established at levels of green11 house gas emissions lower than would 

12 occur under a business-as-usual scenario, 

13 taking into account relevant domestic or 

14 international policies or incentives to re15 duce greenhouse gas emissions; 

16 ‘‘(ii) be used to determine 

17 additionality and performance; 

18 ‘‘(iii) account for all significant 

19 sources of emissions from a sector; 

20 ‘‘(iv) be adjusted over time to reflect 

21 changing circumstances; 

22 ‘‘(v) be developed taking into consid23 eration such factors as— 

24 ‘‘(I) any established emissions 

25 performance level for the sector; 


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1 ‘‘(II) the current performance of 

2 the sector in the country; 

3 ‘‘(III) expected future trends of 

4 the sector in the country; and 

5 ‘‘(IV) historical data and other 

6 factors to ensure additionality; and 

7 ‘‘(vi) be designed to produce signifi8 cant deviations from business-as-usual 

9 emissions, consistent with nationally appro10 priate mitigation commitments or actions, 

11 in a way that equitably contributes to 

12 meeting thresholds identified in section 

13 705(e)(2). 

14 ‘‘(d) CREDITS ISSUED BY AN INTERNATIONAL

15 BODY.— 

16 ‘‘(1) IN GENERAL.—The Administrator, in con17 sultation with the Secretary of State, may issue 

18 international offset credits in exchange for instru19 ments in the nature of offset credits that are issued 

20 by an international body established pursuant to the 

21 United Nations Framework Convention on Climate 

22 Change, to a protocol to such Convention, or to a 

23 treaty that succeeds such Convention. The Adminis24 trator may issue international offset credits under 

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1 ments of subsection (b), the Administrator has de2 termined that the international body that issued the 

3 instruments has implemented substantive and proce4 dural requirements for the relevant project type that 

5 provide equal or greater assurance of the integrity of 

6 such instruments as is provided by the requirements 

7 of this part. Beginning on January 1, 2016, the Ad8 ministrator shall issue no offset credit pursuant to 

9 this subsection if the activity generating the green10 house gas emission reductions or avoidance, or 

11 greenhouse gas sequestration, occurs in a country 

12 and sector identified by the Administrator under 

13 subsection (c), unless the offset credit issued by the 

14 international body is consistent with section 744(c). 

15 ‘‘(2) RETIREMENT.—The Administrator, in 

16 consultation with the Secretary of State, shall seek, 

17 by whatever means appropriate, including agree18 ments, arrangements, or technical cooperation with 

19 the international issuing body described in para20 graph (1), to ensure that such body— 

21 ‘‘(A) is notified of the Administrator’s 

22 issuance, under this subsection, of an inter23 national offset credit in exchange for an instru24 ment issued by such international body; and 


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1 ‘‘(B) provides, to the extent feasible, for 

2 the disqualification of the instrument issued by 

3 such international body for subsequent use 

4 under any relevant foreign or international 

5 greenhouse gas regulatory program, regardless 

6 of whether such use is a sale, exchange, or sub7 mission to satisfy a compliance obligation. 

8 ‘‘(e) OFFSETS FROM REDUCED DEFORESTATION.— 

9 ‘‘(1) REQUIREMENTS.—The Administrator, in 

10 accordance with the regulations promulgated under 

11 subsection (b)(1) and an agreement or arrangement 

12 described in subsection (b)(2)(A), shall issue inter13 national offset credits for greenhouse gas emission 

14 reductions achieved through activities to reduce de15 forestation only if, in addition to the requirements of 

16 subsection (b)— 

17 ‘‘(A) the activity occurs in— 

18 ‘‘(i) a country listed by the Adminis19 trator pursuant to paragraph (2); 

20 ‘‘(ii) a State or province listed by the 

21 Administrator pursuant to paragraph (5); 

22 or 

23 ‘‘(iii) a country listed by the Adminis24 trator pursuant to paragraph (6); 


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1 ‘‘(B) except as provided in paragraph (5) 

2 or (6), the quantity of the international offset 

3 credits is determined by comparing the national 

4 emissions from deforestation relative to a na5 tional deforestation baseline for that country es6 tablished, in accordance with an agreement or 

7 arrangement described in subsection (b)(2)(A), 

8 pursuant to paragraph (4); 

9 ‘‘(C) the reduction in emissions from de10 forestation has occurred before the issuance of 

11 the international offset credit and, taking into 

12 consideration relevant international standards, 

13 has been demonstrated using ground-based in14 ventories, remote sensing technology, and other 

15 methodologies to ensure that all relevant carbon 

16 stocks are accounted; 

17 ‘‘(D) the Administrator has made appro18 priate adjustments, such as discounting for any 

19 additional uncertainty, to account for cir20 cumstances specific to the country, including its 

21 technical capacity described in paragraph 

22 (2)(A); 

23 ‘‘(E) the Administrator has determined 

24 that the country within which the activity oc25 curs has in place a publicly available strategic 


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1 plan that includes the criteria listed in para2 graph (2)(C); 

3 ‘‘(F) the activity is designed, carried out, 

4 and managed— 

5 ‘‘(i) in accordance with forest manage6 ment practices that— 

7 ‘‘(I) improve the livelihoods of 

8 forest communities; 

9 ‘‘(II) maintain the natural bio10 diversity, resilience, and carbon stor11 age capacity of forests; and 

12 ‘‘(III) do not adversely impact 

13 the permanence of forest carbon 

14 stocks or emission reductions; 

15 ‘‘(ii) to promote or restore native for16 est species and ecosystems where prac17 ticable, and to avoid the introduction of 

18 invasive nonnative species; 

19 ‘‘(iii) in a manner that gives due re20 gard to the rights and interests of local 

21 communities, indigenous peoples, forest-de22 pendent communities, and vulnerable social 

23 groups; 

24 ‘‘(iv) with consultations with, and full 

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1 nous peoples, and forest-dependent com2 munities, in affected areas, as partners 

3 and primary stakeholders, prior to and 

4 during the design, planning, implementa5 tion, and monitoring and evaluation of ac6 tivities; 

7 ‘‘(v) with transparent and equitable 

8 sharing of profits and benefits derived 

9 from offset credits with local communities, 

10 indigenous peoples, and forest-dependent 

11 communities; 

12 ‘‘(vi) with full transparency, third13 party independent oversight, and public 

14 dissemination of related financial and con15 tractual arrangements, and 

16 ‘‘(vii) so that the social and environ17 mental impacts of these activities are mon18 itored and reported in sufficient detail to 

19 allow appropriate officials to determine 

20 compliance with the requirements of this 

21 section; 

22 ‘‘(G) the reduction otherwise satisfies and 

23 is consistent with any relevant requirements es24 tablished by an agreement reached under the 

25 auspices of the United Nations Framework 


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1 Convention on Climate Change, done at New 

2 York on May 9, 1992; and 

3 ‘‘(H) in the case that offsets are deter4 mined by comparing the national emissions 

5 from deforestation relative to a national, state6 level, or province-level deforestation baseline as 

7 provided in paragraph (4) or (5)— 

8 ‘‘(i) a list of activities to reduce defor9 estation is provided to the Administrator 

10 and made publicly available; 

11 ‘‘(ii) the social and environmental im12 pacts of these activities are monitored and 

13 reported in sufficient detail to allow the 

14 Administrator to determine compliance 

15 with the requirements of this section; and 

16 ‘‘(iii) the distribution of revenues for 

17 activities to reduce deforestation is trans18 parent, subject to independent third-party 

19 oversight, and publicly disseminated. 

20 ‘‘(2) ELIGIBLE COUNTRIES.—The Adminis21 trator, in consultation with the Secretary of State 

22 and the Administrator of the United States Agency 

23 for International Development, and in accordance 

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1 view and update, a list of the developing countries 

2 that have the capacity to participate in deforestation 

3 reduction activities at a national level, including— 

4 ‘‘(A) the technical capacity to monitor, 

5 measure, report, and verify forest carbon fluxes 

6 for all significant sources of greenhouse gas 

7 emissions from deforestation with an acceptable 

8 level of uncertainty, as determined taking into 

9 account relevant internationally accepted meth10 odologies, such as those established by the 

11 Intergovernmental Panel on Climate Change; 

12 ‘‘(B) the institutional capacity to reduce 

13 emissions from deforestation, including strong 

14 forest governance and mechanisms to ensure 

15 transparency and third-party independent over16 sight of offset activities and revenues, and the 

17 transparent and equitable distribution of offset 

18 revenues for local actions; and 

19 ‘‘(C) a land use or forest sector strategic 

20 plan that— 

21 ‘‘(i) assesses national and local drivers 

22 of deforestation and forest degradation and 

23 identifies reforms to national policies need24 ed to address them; 


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1 ‘‘(ii) estimates the country’s emissions 

2 from deforestation and forest degradation; 

3 ‘‘(iii) identifies improvements in and a 

4 timeline for data collection, monitoring, 

5 and institutional capacity necessary to im6 plement an effective national deforestation 

7 reduction program that meets the criteria 

8 set forth in this section (including a na9 tional deforestation baseline); 

10 ‘‘(iv) establishes a timeline for imple11 menting the program and transitioning 

12 forest-based economies to low-emissions de13 velopment pathways with respect to emis14 sions from forest and land use activities; 

15 ‘‘(v) includes a national policy for con16 sultations with, and full participation of, 

17 all stakeholders, especially indigenous and 

18 forest-dependent communities, in its de19 sign, planning, and implementation of ac20 tivities, whether at the national or local 

21 level, to reduce deforestation in the country 

22 (including a national process for address23 ing grievances if stakeholders have been 

24 caused social, environmental, or economic 

25 harm); 


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1 ‘‘(vi) provides for the distribution of 

2 revenues for activities to reduce deforest3 ation transparently and publicly, subject to 

4 independent third-party oversight; and 

5 ‘‘(vii) includes a national platform or 

6 a type of registry for information relating 

7 to deforestation and degradation policy and 

8 program implementation processes, includ9 ing a mechanism for the monitoring and 

10 reporting of the social and environmental 

11 impacts of those activities. 

12 ‘‘(3) PROTECTION OF INTERESTS.—With re13 spect to an agreement or arrangement described in 

14 subsection (b)(2)(A) with a country that addresses 

15 international offset credits under this subsection, the 

16 Administrator, in consultation with the Secretary of 

17 State and the Administrator of the United States 

18 Agency for International Development, shall under19 take due diligence to ensure the establishment and 

20 enforcement by such country of legal regimes, proc21 esses, standards, and safeguards that— 

22 ‘‘(A) give due regard to the rights and in23 terests of local communities, indigenous peoples, 

24 forest-dependent communities, and vulnerable 

25 social groups; 


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1 ‘‘(B) promote consultations with, and full 

2 participation of, forest-dependent communities 

3 and indigenous peoples in affected areas, as 

4 partners and primary stakeholders, prior to and 

5 during the design, planning, implementation, 

6 and monitoring and evaluation of activities; and 

7 ‘‘(C) encourage transparent and equitable 

8 sharing of profits and benefits derived from 

9 international offset credits with local commu10 nities, indigenous peoples, and forest-dependent 

11 communities. 

12 ‘‘(4) NATIONAL DEFORESTATION BASELINE.—A 

13 national deforestation baseline established under this 

14 subsection shall— 

15 ‘‘(A) be national in scope; 

16 ‘‘(B) be consistent with nationally appro17 priate mitigation commitments or actions with 

18 respect to deforestation, taking into consider19 ation the average annual historical deforestation 

20 rates of the country during a period of at least 

21 5 years, the applicable drivers of deforestation, 

22 and other factors to ensure that only reductions 

23 that are in addition to such commitments or ac24 tions will generate offsets; 


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1 ‘‘(C) establish a trajectory that would re2 sult in zero net deforestation by not later than 

3 20 years after the national deforestation base4 line has been established, including a spatially 

5 explicit land use plan that identifies intact and 

6 primary forest areas and managed forest areas 

7 that are to remain while the country is reaching 

8 the zero net deforestation trajectory; 

9 ‘‘(D) be adjusted over time to take account 

10 of changing national circumstances; 

11 ‘‘(E) be designed to account for all signifi12 cant sources of greenhouse gas emissions from 

13 deforestation in the country; and 

14 ‘‘(F) be consistent with the national defor15 estation baseline, if any, established for such 

16 country under section 753. 

17 ‘‘(5) STATE-LEVEL OR PROVINCE-LEVEL AC18 TIVITIES.— 

19 ‘‘(A) ELIGIBLE STATES OR PROVINCES.— 

20 The Administrator, in consultation with the 

21 Secretary of State and the Administrator of the 

22 United States Agency for International Devel23 opment, shall establish, and periodically review 

24 and update, a list of States or provinces in de25 veloping countries where— 


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1 ‘‘(i) the developing country is not in2 cluded on the list of countries established 

3 pursuant to paragraph (6)(A); 

4 ‘‘(ii) the State or province is under5 taking deforestation reduction activities; 

6 ‘‘(iii) the State or province has the ca7 pacity to engage in deforestation reduction 

8 activities at the State or province level, in9 cluding— 

10 ‘‘(I) the technical capacity to 

11 monitor and measure forest carbon 

12 fluxes for all significant sources of 

13 greenhouse gas emissions from defor14 estation with an acceptable amount of 

15 uncertainty, including a spatially ex16 plicit land use plan that identifies in17 tact and primary forest areas and 

18 managed forest areas that are to re19 main while the country is reaching the 

20 zero net deforestation trajectory; and 

21 ‘‘(II) the institutional capacity to 

22 reduce emissions from deforestation, 

23 including strong forest governance 

24 and mechanisms to deliver forest con25 servation resources for local actions; 


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1 ‘‘(iv) the State or province meets the 

2 eligibility criteria in paragraphs (2) and 

3 (3) for the geographic area under its juris4 diction; and 

5 ‘‘(v) the country— 

6 ‘‘(I) demonstrates that efforts 

7 are underway to transition to a na8 tional program within 5 years; or 

9 ‘‘(II) in the determination of the 

10 Administrator, is making a good-faith 

11 effort to develop a land use or forest 

12 sector strategic national plan or pro13 gram that meets the criteria described 

14 in paragraph (2)(C). 

15 ‘‘(B) ACTIVITIES.—The Administrator may 

16 issue international offset credits for greenhouse 

17 gas emission reductions achieved through activi18 ties to reduce deforestation at a State or pro19 vincial level that meet the requirements of this 

20 section. Such credits shall be determined by 

21 comparing the emissions from deforestation 

22 within that State or province relative to the 

23 State or province deforestation baseline for that 

24 State or province established, in accordance 

25 with an agreement or arrangement described in 


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1 subsection (b)(2)(A), pursuant to subparagraph 

2 (C) of this paragraph. 

3 ‘‘(C) STATE-LEVEL OR PROVINCE-LEVEL

4 DEFORESTATION BASELINE.—A State-level or 

5 province-level deforestation baseline shall— 

6 ‘‘(i) be consistent with any existing 

7 nationally appropriate mitigation commit8 ments or actions for the country in which 

9 the activity is occurring, so that only re10 ductions that are in addition to those com11 mitments or actions will generate offsets; 

12 ‘‘(ii) be developed taking into consid13 eration the average annual historical defor14 estation rates of the State or province dur15 ing a period of at least 5 years, relevant 

16 drivers of deforestation, and other factors 

17 to ensure additionality; 

18 ‘‘(iii) establish a trajectory that would 

19 result in zero net deforestation by not later 

20 than 20 years after the State-level or prov21 ince-level deforestation baseline has been 

22 established; and 

23 ‘‘(iv) be designed to account for all 

24 significant sources of greenhouse gas emis25 sions from deforestation in the State or 


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1 province and adjusted to fully account for 

2 emissions leakage outside the State or 

3 province through monitoring of major for4 ested areas in the host country and other 

5 areas of the host country susceptible to 

6 leakage. 

7 ‘‘(D) PHASE-OUT.—Beginning 5 years 

8 after the first calendar year for which a covered 

9 entity must demonstrate compliance with sec10 tion 722(a), the Administrator shall issue no 

11 further international offset credits for eligible 

12 State-level or province-level activities to reduce 

13 deforestation pursuant to this paragraph. 

14 ‘‘(6) PROJECTS AND PROGRAMS TO REDUCE

15 DEFORESTATION.— 

16 ‘‘(A) ELIGIBLE COUNTRIES.—The Admin17 istrator, in consultation with the Secretary of 

18 State and the Administrator of the United 

19 States Agency for International Development, 

20 shall establish, and periodically review and up21 date, a list of developing countries that— 

22 ‘‘(i) the Administrator determines, 

23 based on recent, credible, and reliable 

24 emissions data, account for less than 1 

25 percent of global greenhouse gas emissions 


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1 and less than 3 percent of global forest2 sector and land use change greenhouse gas 

3 emissions; 

4 ‘‘(ii) have, or in the determination of 

5 the Administrator are making a good faith 

6 effort to develop, a land use or forest sec7 tor strategic plan that meets the criteria 

8 described in paragraph (2)(C); and 

9 ‘‘(iii) has made, or in the determina10 tion of the Administrator, is making, a 

11 good-faith effort to develop, through the 

12 implementation of activities under this sec13 tion, a monitoring program for major for14 ested areas in a host country and other 

15 areas in a host country susceptible to leak16 age, including a spatially explicit land use 

17 plan that identifies intact and primary for18 est areas and managed forest areas that 

19 are to remain while country is reaching the 

20 zero net deforestation trajectory. 

21 ‘‘(B) ACTIVITIES.—The Administrator may 

22 issue international offset credits for greenhouse 

23 gas emission reductions achieved through 

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1 graph (A) that meet the requirements of this 

2 section. The quantity of international offset 

3 credits shall be determined by comparing the 

4 project-level or program-level emissions from 

5 deforestation to a deforestation baseline for 

6 such project or program established pursuant to 

7 subparagraph (C). 

8 ‘‘(C) PROJECT-LEVEL OR PROGRAM-LEVEL

9 BASELINE.—A project-level or program-level de10 forestation baseline shall— 

11 ‘‘(i) be consistent with any existing 

12 nationally appropriate mitigation commit13 ments or actions for the country in which 

14 the project or program is occurring, so 

15 that only reductions that are in addition to 

16 such commitments or actions will generate 

17 offsets; 

18 ‘‘(ii) be developed taking into consid19 eration the average annual historical defor20 estation rates in the project or program 

21 boundary during a period of at least 5 

22 years, applicable drivers of deforestation, 

23 and other factors to ensure additionality; 

24 ‘‘(iii) be designed to account for all 

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1 sions from deforestation in the project or 

2 program boundary; and 

3 ‘‘(iv) be adjusted to fully account for 

4 emissions leakage outside the project or 

5 program boundary, including— 

6 ‘‘(I) estimation through moni7 toring of major forested areas in a 

8 host country and other areas in a host 

9 country susceptible to leakage, pursu10 ant to section 744(e)(5); and 

11 ‘‘(II) a spatially explicit land use 

12 plan that identifies intact and primary 

13 forest areas and managed forest areas 

14 that are to remain while country is 

15 reaching the zero net deforestation 

16 trajectory. 

17 ‘‘(D) PHASE-OUT.— 

18 ‘‘(i) IN GENERAL.—Beginning on the 

19 date that is 8 years after the first calendar 

20 year for which a covered entity must dem21 onstrate compliance with section 722(a), 

22 the Administrator shall issue no further 

23 international offset credits for project-level 

24 or program-level activities as described in 


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1 this paragraph, except as provided in 

2 clause (ii). 

3 ‘‘(ii) EXTENSION.—The Administrator 

4 may extend the phase out deadline for the 

5 issuance of international offset credits 

6 under this section by up to 5 years with re7 spect to eligible activities taking place in a 

8 least developed country, which is a foreign 

9 country that the United Nations has iden10 tified as among the least developed of de11 veloping countries at the time that the Ad12 ministrator determines to provide an exten13 sion, provided that the Administrator, in 

14 consultation with the Secretary of State 

15 and the Administrator of the United States 

16 Agency for International Development, de17 termines the country— 

18 ‘‘(I) lacks sufficient capacity to 

19 adopt and implement effective pro20 grams to achieve reductions in defor21 estation measured against national 

22 baselines; 

23 ‘‘(II) is receiving support under 

24 part E to develop such capacity; and 


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1 ‘‘(III) has developed and is work2 ing to implement a credible national 

3 strategy or plan to reduce deforest4 ation. 

5 ‘‘(7) EXPANSION OF SCOPE.—In implementing 

6 this subsection, the Administrator, taking into con7 sideration the recommendations of the Advisory 

8 Board, may— 

9 ‘‘(A) expand credible activities to include 

10 forest degradation; and 

11 ‘‘(B) include soil carbon losses associated 

12 with forested wetlands or peatlands. 

13 ‘‘(f) MODIFICATION OF REQUIREMENTS.—In promul14 gating regulations under subsection (b)(1) with respect to 

15 the issuance of international offset credits under sub16 section (c), (d), or (e), the Administrator, in consultation 

17 with the Secretary of State and the Administrator of the 

18 United States Agency for International Development, may 

19 modify or omit a requirement of this part (excluding the 

20 requirements of this section) if the Administrator deter21 mines that the application of that requirement to such 

22 subsection is not feasible or would result in the creation 

23 of offset credits that would not be eligible to satisfy emis24 sions reduction commitments made by the United States 

25 pursuant to the United Nations Framework Convention 


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1 on Climate Change, done at New York on May 9, 1992 

2 (or any successor agreement). In modifying or omitting 

3 such a requirement on the basis of infeasibility, the Ad4 ministrator, in consultation with the Secretary of State 

5 and the Administrator of the United States Agency for 

6 International Development, shall ensure, with an adequate 

7 margin of safety, the integrity of international offset cred8 its issued under this section and of the greenhouse gas 

9 emissions limitations established pursuant to section 703. 

10 ‘‘(g) AVOIDING DOUBLE COUNTING.—The Adminis11 trator, in consultation with the Secretary of State, shall 

12 seek, by whatever means appropriate, including agree13 ments, arrangements, or technical cooperation, to ensure 

14 that activities on the basis of which international offset 

15 credits are issued under this section are not used for com16 pliance with an obligation to reduce or avoid greenhouse 

17 gas emissions, or increase greenhouse gas sequestration, 

18 under a foreign or international regulatory system. In ad19 dition, no international offset credits shall be issued for 

20 emission reductions from activities with respect to which 

21 emission allowances were allocated under section 771(d) 

22 for distribution under part E. 

23 ‘‘(h) LIMITATION.—The Administrator shall not issue 

24 international offset credits generated by projects based on 

25 the destruction of hydrofluorocarbons.’’. 


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1 SEC. 102. DEFINITIONS. 

2 Title VII of the Clean Air Act (as added by section 

3 101 of this division) is amended by inserting before part 

4 A the following: 

5 ‘‘SEC. 700. DEFINITIONS. 

6 ‘‘In this title: 

7 ‘‘(1) ADDITIONAL.—The term ‘additional’, 

8 when used with respect to reductions or avoidance of 

9 greenhouse gas emissions, or to sequestration of 

10 greenhouse gases, means reductions, avoidance, or 

11 sequestration that result in a lower level of net 

12 greenhouse gas emissions or atmospheric concentra13 tions than would occur in the absence of an offset 

14 credit. 

15 ‘‘(2) ADDITIONALITY.—The term ‘additionality’ 

16 means the extent to which reductions or avoidance 

17 of greenhouse gas emissions, or sequestration of 

18 greenhouse gases, are additional. 

19 ‘‘(3) ADVISORY BOARD.—The term ‘Advisory 

20 Board’ means the Offsets Integrity Advisory Board 

21 established under section 731. 

22 ‘‘(4) AFFILIATED.—The term ‘affiliated’— 

23 ‘‘(A) when used in relation to an entity, 

24 means owned or controlled by, or under com25 mon ownership or control with, another entity, 

26 as determined by the Administrator; and 


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1 ‘‘(B) when used in relation to a natural 

2 gas local distribution company, means owned or 

3 controlled by, or under common ownership or 

4 control with, another natural gas local distribu5 tion company, as determined by the Adminis6 trator. 

7 ‘‘(5) ALLOWANCE.—The term ‘allowance’ 

8 means a limited authorization to emit, or have at9 tributable greenhouse gas emissions in an amount 

10 of, 1 ton of carbon dioxide equivalent of a green11 house gas in accordance with this title; it includes an 

12 emission allowance, a compensatory allowance, or an 

13 international emission allowance. 

14 ‘‘(6) ATTRIBUTABLE GREENHOUSE GAS EMIS15 SIONS.—The term ‘attributable greenhouse gas emis16 sions’ means— 

17 ‘‘(A) for a covered entity that is a fuel pro18 ducer or importer described in paragraph 

19 (13)(B), greenhouse gases that would be emit20 ted from the combustion of any petroleum21 based or coal-based liquid fuel, petroleum coke, 

22 or natural gas liquid, produced or imported by 

23 that covered entity for sale or distribution in 

24 interstate commerce, assuming no capture and 

25 sequestration of any greenhouse gas emissions; 


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1 ‘‘(B) for a covered entity that is an indus2 trial gas producer or importer described in 

3 paragraph (13)(C), the tons of carbon dioxide 

4 equivalent of fossil fuel-based carbon dioxide, 

5 nitrous oxide, any fluorinated gas, other than 

6 nitrogen trifluoride, that is a greenhouse gas, or 

7 any combination thereof— 

8 ‘‘(i) produced or imported by such 

9 covered entity during the previous calendar 

10 year for sale or distribution in interstate 

11 commerce; or 

12 ‘‘(ii) released as fugitive emissions in 

13 the production of fluorinated gas; and 

14 ‘‘(C) for a natural gas local distribution 

15 company described in paragraph (13)(J), green16 house gases that would be emitted from the 

17 combustion of the natural gas, and any other 

18 gas meeting the specifications for commingling 

19 with natural gas for purposes of delivery, that 

20 such entity delivered during the previous cal21 endar year to customers that are not covered 

22 entities, assuming no capture and sequestration 

23 of that greenhouse gas. 

24 ‘‘(7) BIOLOGICAL SEQUESTRATION; BIO25 LOGICALLY SEQUESTERED.—The terms ‘biological 


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1 sequestration’ and ‘biologically sequestered’ mean 

2 the removal of greenhouse gases from the atmos3 phere by terrestrial biological means, such as by 

4 growing plants, and the storage of those greenhouse 

5 gases in plants or soils. 

6 ‘‘(8) CAPPED EMISSIONS.—The term ‘capped 

7 emissions’ means greenhouse gas emissions to which 

8 section 722 applies, including emissions from the 

9 combustion of natural gas, petroleum-based or coal10 based liquid fuel, petroleum coke, or natural gas liq11 uid to which section 722(b)(2) or (8) applies. 

12 ‘‘(9) CAPPED SOURCE.—The term ‘capped 

13 source’ means a source that directly emits capped 

14 emissions. 

15 ‘‘(10) CARBON DIOXIDE EQUIVALENT.—The 

16 term ‘carbon dioxide equivalent’ means the unit of 

17 measure, expressed in metric tons, of greenhouse 

18 gases as provided under section 711 or 712. 

19 ‘‘(11) CARBON STOCK.—The term ‘carbon 

20 stock’ means the quantity of carbon contained in a 

21 biological reservoir or system which has the capacity 

22 to accumulate or release carbon. 

23 ‘‘(12) COMPENSATORY ALLOWANCE.—The term 

24 ‘compensatory allowance’ means an allowance issued 

25 under section 721(f). 


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1 ‘‘(13) COVERED ENTITY.—The term ‘covered 

2 entity’ means each of the following: 

3 ‘‘(A) Any electricity source. 

4 ‘‘(B)(i) Any stationary source that pro5 duces petroleum-based or coal-based liquid fuel, 

6 petroleum coke, or natural gas liquid, the com7 bustion of which would emit 25,000 or more 

8 tons of carbon dioxide equivalent, as determined 

9 by the Administrator. 

10 ‘‘(ii) Any entity that (or any group of 2 or 

11 more affiliated entities that, in the aggregate) 

12 imports petroleum-based or coal-based liquid 

13 fuel, petroleum coke, or natural gas liquid, the 

14 combustion of which would emit 25,000 or more 

15 tons of carbon dioxide equivalent, as determined 

16 by the Administrator. 

17 ‘‘(C) Any stationary source that produces, 

18 and any entity that (or any group of two or 

19 more affiliated entities that, in the aggregate) 

20 imports, for sale or distribution in interstate 

21 commerce, in bulk, or in products designated by 

22 the Administrator, in 2008 or any subsequent 

23 year more than 25,000 tons of carbon dioxide 

24 equivalent of— 

25 ‘‘(i) fossil fuel-based carbon dioxide; 


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1 ‘‘(ii) nitrous oxide; 

2 ‘‘(iii) except as otherwise provided in 

3 section 714, perfluorocarbons; 

4 ‘‘(iv) sulfur hexafluoride; 

5 ‘‘(v) any other fluorinated gas, except 

6 for nitrogen trifluoride, that is a green7 house gas, as designated by the Adminis8 trator under section 711(b) or (c); or 

9 ‘‘(vi) any combination of greenhouse 

10 gases described in clauses (i) through (v). 

11 ‘‘(D) Any stationary source that has emit12 ted 25,000 or more tons of carbon dioxide 

13 equivalent of nitrogen trifluoride in 2008 or any 

14 subsequent year. 

15 ‘‘(E) Any geologic sequestration site. 

16 ‘‘(F) Any stationary source in the following 

17 industrial sectors: 

18 ‘‘(i) Adipic acid production. 

19 ‘‘(ii) Primary aluminum production. 

20 ‘‘(iii) Ammonia manufacturing. 

21 ‘‘(iv) Cement production, excluding 

22 grinding-only operations. 

23 ‘‘(v) Hydrochlorofluorocarbon produc24 tion. 

25 ‘‘(vi) Lime manufacturing. 


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1 ‘‘(vii) Nitric acid production. 

2 ‘‘(viii) Petroleum refining. 

3 ‘‘(ix) Phosphoric acid production. 

4 ‘‘(x) Silicon carbide production. 

5 ‘‘(xi) Soda ash production. 

6 ‘‘(xii) Titanium dioxide production. 

7 ‘‘(xiii) Coal-based liquid or gaseous 

8 fuel production. 

9 ‘‘(G) Any stationary source in the chemical 

10 or petrochemical sector that, in 2008 or any 

11 subsequent year— 

12 ‘‘(i) produces acrylonitrile, carbon 

13 black, ethylene, ethylene dichloride, ethyl14 ene oxide, or methanol; or 

15 ‘‘(ii) produces a chemical or petro16 chemical product if producing that product 

17 results in annual combustion plus process 

18 emissions of 25,000 or more tons of carbon 

19 dioxide equivalent. 

20 ‘‘(H) Any stationary source that— 

21 ‘‘(i) is in one of the following indus22 trial sectors: ethanol production; ferroalloy 

23 production; fluorinated gas production; 

24 food processing; glass production; hydrogen 

25 production; metal ore production or other 


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1 processing; iron and steel production; lead 

2 production; pulp and paper manufacturing; 

3 and zinc production; and 

4 ‘‘(ii) has emitted 25,000 or more tons 

5 of carbon dioxide equivalent in 2008 or 

6 any subsequent year. 

7 ‘‘(I) Any fossil fuel-fired combustion device 

8 (such as a boiler) or grouping of such devices 

9 that— 

10 ‘‘(i) is all or part of an industrial 

11 source not specified in subparagraph (D), 

12 (F), (G), or (H); and 

13 ‘‘(ii) has emitted 25,000 or more tons 

14 of carbon dioxide equivalent in 2008 or 

15 any subsequent year. 

16 ‘‘(J) Any natural gas local distribution 

17 company that (or any group of 2 or more affili18 ated natural gas local distribution companies 

19 that, in the aggregate) in 2008 or any subse20 quent year, delivers 460,000,000 cubic feet or 

21 more of natural gas to customers that are not 

22 covered entities. 

23 ‘‘(14) CREDITING PERIOD.—The term ‘crediting 

24 period’ means the period with respect to which an 


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1 offset project is eligible to earn offset credits under 

2 part D, as determined under section 734(c). 

3 ‘‘(15) DESIGNATED REPRESENTATIVE.—The 

4 term ‘designated representative’ means, with respect 

5 to a covered entity, a reporting entity, an offset 

6 project developer, or any other entity receiving or 

7 holding allowances or offset credits under this title, 

8 an individual authorized, through a certificate of 

9 representation submitted to the Administrator by 

10 the owners and operators or similar entity official, to 

11 represent the owners and operators or similar entity 

12 official in all matters pertaining to this title (includ13 ing the holding, transfer, or disposition of allowances 

14 or offset credits), and to make all submissions to the 

15 Administrator under this title. 

16 ‘‘(16) DEVELOPING COUNTRY.—The term ‘de17 veloping country’ means a country eligible to receive 

18 official development assistance according to the in19 come guidelines of the Development Assistance Com20 mittee of the Organization for Economic Coopera21 tion and Development. 

22 ‘‘(17) DOMESTIC OFFSET CREDIT.— 

23 ‘‘(A) IN GENERAL.—The term ‘domestic 

24 offset credit’ means an offset credit issued 


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1 under part D, other than an international offset 

2 credit. 

3 ‘‘(B) EXCLUSION.—The term ‘domestic 

4 offset credit’ does not include a term offset 

5 credit. 

6 ‘‘(18) ELECTRICITY SOURCE.—The term ‘elec7 tricity source’ means a stationary source that in8 cludes one or more utility units. 

9 ‘‘(19) EMISSION.—The term ‘emission’ means 

10 the release of a greenhouse gas into the ambient air. 

11 Such term does not include gases that are captured 

12 and sequestered, except to the extent that they are 

13 later released into the atmosphere, in which case 

14 compliance must be demonstrated pursuant to sec15 tion 722(b)(5). 

16 ‘‘(20) EMISSION ALLOWANCE.—The term ‘emis17 sion allowance’ means an allowance established 

18 under section 721(a) or 726(g)(2). 

19 ‘‘(21) FAIR MARKET VALUE.—The term ‘fair 

20 market value’ means the average daily closing price 

21 on registered exchanges or, if such a price is un22 available, the average price as determined by the Ad23 ministrator, during a specified time period, of an 

24 emission allowance. 


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1 ‘‘(22) FEDERAL LAND.—The term ‘Federal 

2 land’ means land that is owned by the United 

3 States, other than land held in trust for an Indian 

4 or Indian tribe. 

5 ‘‘(23) FOSSIL FUEL.—The term ‘fossil fuel’ 

6 means natural gas, petroleum, or coal, or any form 

7 of solid, liquid, or gaseous fuel derived from such 

8 material, including consumer products that are de9 rived from such materials and are combusted. 

10 ‘‘(24) FOSSIL FUEL-FIRED.—The term ‘fossil 

11 fuel-fired’ means powered by combustion of fossil 

12 fuel, alone or in combination with any other fuel, re13 gardless of the percentage of fossil fuel consumed. 

14 ‘‘(25) FUGITIVE EMISSIONS.—The term ‘fugi15 tive emissions’ means emissions from leaks, valves, 

16 joints, or other small openings in pipes, ducts, or 

17 other equipment, or from vents. 

18 ‘‘(26) GEOLOGIC SEQUESTRATION; GEOLOGI19 CALLY SEQUESTERED.—The terms ‘geologic seques20 tration’ and ‘geologically sequestered’ mean the se21 questration of greenhouse gases in subsurface geo22 logic formations for purposes of permanent storage. 

23 ‘‘(27) GEOLOGIC SEQUESTRATION SITE.—The 

24 term ‘geologic sequestration site’ means a site where 

25 carbon dioxide is geologically sequestered. 


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1 ‘‘(28) GREENHOUSE GAS.—The term ‘green2 house gas’ means any gas described in section 

3 711(a) or designated under section 711(b), (c), or 

4 (e), except to the extent that it is regulated under 

5 title VI. 

6 ‘‘(29) HIGH CONSERVATION PRIORITY LAND.— 

7 The term ‘high conservation priority land’ means 

8 land that is not Federal land and is— 

9 ‘‘(A) globally or State ranked as critically 

10 imperiled or imperiled under a State Natural 

11 Heritage Program; or 

12 ‘‘(B) old-growth or late-successional forest, 

13 as identified by the office of the State Forester 

14 or relevant State agency with regulatory juris15 diction over forestry activities. 

16 ‘‘(30) HOLD.—The term ‘hold’ means, with re17 spect to an allowance, offset credit, or term offset 

18 credit, to have in the appropriate account in the al19 lowance tracking system, or submit to the Adminis20 trator for recording in such account. 

21 ‘‘(31) INDUSTRIAL SOURCE.—The term ‘indus22 trial source’ means any stationary source that— 

23 ‘‘(A) is not an electricity source; and 

24 ‘‘(B) is in— 


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1 ‘‘(i) the manufacturing sector (as de2 fined in North American Industrial Classi3 fication System codes 31, 32, and 33); or 

4 ‘‘(ii) the natural gas processing or 

5 natural gas pipeline transportation sector 

6 (as defined in North American Industrial 

7 Classification System codes 211112 or 

8 486210). 

9 ‘‘(32) INTERNATIONAL EMISSION ALLOW10 ANCE.—The term ‘international emission allowance’ 

11 means a tradable authorization to emit 1 ton of car12 bon dioxide equivalent of greenhouse gas that is 

13 issued by a national or supranational foreign govern14 ment pursuant to a qualifying international program 

15 designated by the Administrator pursuant to section 

16 728(a). 

17 ‘‘(33) INTERNATIONAL OFFSET CREDIT.—The 

18 term ‘international offset credit’ means an offset 

19 credit issued by the Administrator under section 

20 744. 

21 ‘‘(34) LEAKAGE.—The term ‘leakage’ means a 

22 significant increase in greenhouse gas emissions, or 

23 significant decrease in sequestration, which is caused 

24 by an offset project and occurs outside the bound25 aries of the offset project. 


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1 ‘‘(35) MARKET STABILITY RESERVE ALLOW2 ANCE.—The term ‘market stability reserve allow3 ance’ means an emission allowance reserved for, 

4 transferred to, or deposited in the market stability 

5 reserve, or established, under section 726. 

6 ‘‘(36) MINERAL SEQUESTRATION.—The term 

7 ‘mineral sequestration’ means sequestration of car8 bon dioxide from the atmosphere by capturing car9 bon dioxide into a permanent mineral, such as the 

10 aqueous precipitation of carbonate minerals that re11 sults in the storage of carbon dioxide in a mineral 

12 form. 

13 ‘‘(37) NATURAL GAS LIQUID.—The term ‘nat14 ural gas liquid’ means ethane, butane, isobutane, 

15 natural gasoline, and propane which is ready for 

16 commercial sale or use. 

17 ‘‘(38) NATURAL GAS LOCAL DISTRIBUTION

18 COMPANY.—The term ‘natural gas local distribution 

19 company’ has the meaning given the term ‘local dis20 tribution company’ in section 2(17) of the Natural 

21 Gas Policy Act of 1978 (15 U.S.C. 3301(17)). 

22 ‘‘(39) OFFSET CREDIT.— 

23 ‘‘(A) IN GENERAL.—The term ‘offset cred24 it’ means an offset credit issued under part D. 


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1 ‘‘(B) EXCLUSION.—The term ‘offset credit’ 

2 does not include a term offset credit. 

3 ‘‘(40) OFFSET PROJECT.—The term ‘offset 

4 project’ means a project or activity that reduces or 

5 avoids greenhouse gas emissions, or sequesters 

6 greenhouse gases, and for which offset credits are or 

7 may be issued under part D. 

8 ‘‘(41) OFFSET PROJECT DEVELOPER.—The 

9 term ‘offset project developer’ means the individual 

10 or entity designated as the offset project developer 

11 in an offset project approval petition under section 

12 735(c)(1). 

13 ‘‘(42) QUALIFIED R&D FACILITY.—The term 

14 ‘qualified R&D facility’ means a facility that con15 ducts research and development, that was in oper16 ation as of the date of enactment of this title, and 

17 that is part of a covered entity subject to paragraphs 

18 (1) through (8) of section 722(b). 

19 ‘‘(43) PETROLEUM.—The term ‘petroleum’ in20 cludes crude oil, tar sands, oil shale, and heavy oils. 

21 ‘‘(44) REPEATED INTENTIONAL REVERSALS.— 

22 The term ‘repeated intentional reversals’ means at 

23 least 3 intentional reversals, as determined by the 

24 Administrator or a court under section 

25 734(b)(3)(B)(ii). 


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1 ‘‘(45) RESEARCH AND DEVELOPMENT.—The 

2 term ‘research and development’ means activities— 

3 ‘‘(A) that are conducted in process units or 

4 at laboratory bench-scale settings; 

5 ‘‘(B) whose purpose is to conduct research 

6 and development for new processes, tech7 nologies, or products that contribute to lower 

8 greenhouse gas emissions; and 

9 ‘‘(C) that do not manufacture products for 

10 sale. 

11 ‘‘(46) RENEWABLE BIOMASS.—The term ‘re12 newable biomass’ means any of the following: 

13 ‘‘(A) Plant material, including waste mate14 rial, harvested or collected from actively man15 aged agricultural land that was in cultivation, 

16 cleared, or fallow and nonforested on January 

17 1, 2009. 

18 ‘‘(B) Plant material, including waste mate19 rial, harvested or collected from pastureland 

20 that was nonforested on January 1, 2009. 

21 ‘‘(C) Nonhazardous vegetative matter de22 rived from waste, including separated yard 

23 waste, landscape right-of-way trimmings, con24 struction and demolition debris, or food waste 

25 (but not municipal solid waste, recyclable waste 


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1 paper, painted, treated or pressurized wood, or 

2 wood contaminated with plastic or metals). 

3 ‘‘(D) Animal waste or animal byproducts, 

4 including products of animal waste digesters. 

5 ‘‘(E) Algae. 

6 ‘‘(F) Trees, brush, slash, residues, or any 

7 other vegetative matter removed from within 

8 600 feet of any building, campground, or route 

9 designated for evacuation by a public official 

10 with responsibility for emergency preparedness, 

11 or from within 300 feet of a paved road, electric 

12 transmission line, utility tower, or water supply 

13 line. 

14 ‘‘(G) Residues from or byproducts of 

15 milled logs. 

16 ‘‘(H) Any of the following removed from 

17 forested land that is not Federal and is not 

18 high conservation priority land: 

19 ‘‘(i) Trees, brush, slash, residues, 

20 interplanted energy crops, or any other 

21 vegetative matter removed from an actively 

22 managed tree plantation established— 

23 ‘‘(I) prior to January 1, 2009; or 


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1 ‘‘(II) on land that, as of January 

2 1, 2009, was cultivated or fallow and 

3 non-forested. 

4 ‘‘(ii) Trees, logging residue, thinnings, 

5 cull trees, pulpwood, and brush removed 

6 from naturally regenerated forests or other 

7 non-plantation forests, including for the 

8 purposes of hazardous fuel reduction or 

9 preventative treatment for reducing or con10 taining insect or disease infestation. 

11 ‘‘(iii) Logging residue, thinnings, cull 

12 trees, pulpwood, brush, and species that 

13 are non-native and noxious, from stands 

14 that were planted and managed after Jan15 uary 1, 2009, to restore or maintain native 

16 forest types. 

17 ‘‘(iv) Dead or severely damaged trees 

18 removed within 5 years of fire, blowdown, 

19 or other natural disaster, and badly in20 fested trees. 

21 ‘‘(I) Materials, pre-commercial thinnings, 

22 or removed invasive species from National For23 est System land and public lands (as defined in 

24 section 103 of the Federal Land Policy and 

25 Management Act of 1976 (43 U.S.C. 1702)), 


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1 including those that are byproducts of preven2 tive treatments (such as trees, wood, brush, 

3 thinnings, chips, and slash), that are removed 

4 as part of a federally recognized timber sale, or 

5 that are removed to reduce hazardous fuels, to 

6 reduce or contain disease or insect infestation, 

7 or to restore ecosystem health, and that are— 

8 ‘‘(i) not from components of the Na9 tional Wilderness Preservation System, 

10 Wilderness Study Areas, Inventoried 

11 Roadless Areas, old growth or mature for12 est stands, components of the National 

13 Landscape Conservation System, National 

14 Monuments, National Conservation Areas, 

15 Designated Primitive Areas; or Wild and 

16 Scenic Rivers corridors; 

17 ‘‘(ii) harvested in environmentally sus18 tainable quantities, as determined by the 

19 appropriate Federal land manager; and 

20 ‘‘(iii) are harvested in accordance with 

21 Federal and State law, and applicable land 

22 management plans. 

23 ‘‘(47) RETIRE.—The term ‘retire’, with respect 

24 to an allowance, offset credit, or term offset credit 

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1 qualify such allowance or offset credit for any subse2 quent use under this title, regardless of whether the 

3 use is a sale, exchange, or submission of the allow4 ance, offset credit, or term offset credit to satisfy a 

5 compliance obligation. 

6 ‘‘(48) REVERSAL.—The term ‘reversal’ means 

7 an intentional or unintentional loss of sequestered 

8 greenhouse gases to the atmosphere. 

9 ‘‘(49) SEQUESTERED AND SEQUESTRATION.— 

10 The terms ‘sequestered’ and ‘sequestration’ mean 

11 the separation, isolation, or removal of greenhouse 

12 gases from the atmosphere, as determined by the 

13 Administrator. The terms include biological, geo14 logic, and mineral sequestration, but do not include 

15 ocean fertilization techniques. 

16 ‘‘(50) STATIONARY SOURCE.—The term ‘sta17 tionary source’ means any integrated operation com18 prising any plant, building, structure, or stationary 

19 equipment, including support buildings and equip20 ment, that is located within one or more contiguous 

21 or adjacent properties, is under common control of 

22 the same person or persons, and emits or may emit 

23 a greenhouse gas. 

24 ‘‘(51) TON.—The term ‘ton’ means a metric 

25 ton. 


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1 ‘‘(52) UNCAPPED EMISSIONS.—The term ‘un2 capped emissions’ means emissions of greenhouse 

3 gases emitted after December 31, 2011, that are not 

4 capped emissions. 

5 ‘‘(53) UNITED STATES GREENHOUSE GAS EMIS6 SIONS.—The term ‘United States greenhouse gas 

7 emissions’ means the total quantity of annual green8 house gas emissions from the United States, as cal9 culated by the Administrator and reported to the 

10 United Nations Framework Convention on Climate 

11 Change Secretariat. 

12 ‘‘(54) UTILITY UNIT.—The term ‘utility unit’ 

13 means a combustion device that, on January 1, 

14 2009, or any date thereafter, is fossil fuel-fired and 

15 serves a generator that produces electricity for sale, 

16 unless such combustion device, during the 12-month 

17 period starting the later of January 1, 2009, or the 

18 commencement of commercial operation and each 

19 calendar year starting after such later date— 

20 ‘‘(A) is part of an integrated cycle system 

21 that cogenerates steam and electricity during 

22 normal operation and that supplies one-third or 

23 less of its potential electric output capacity and 

24 25 MW or less of electrical output for sale; or 


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1 ‘‘(B) combusts materials of which more 

2 than 95 percent is municipal solid waste on a 

3 heat input basis. 

4 ‘‘(55) VINTAGE YEAR.—The term ‘vintage year’ 

5 means the calendar year for which an emission al6 lowance is established under section 721(a) or which 

7 is assigned to an emission allowance under section 

8 726(g)(3)(A), except that the vintage year for a 

9 market stability reserve allowance shall be the year 

10 in which such allowance is purchased at auction.’’. 

11 SEC. 103. OFFSET REPORTING REQUIREMENTS. 

12 Section 114 of Clean Air Act (42 U.S.C. 7414) is 

13 amended by adding at the end the following: 

14 ‘‘(e) RECORDKEEPING FOR CARBON OFFSETS PRO15 GRAM.—For the purpose of implementing the carbon off16 sets program set forth in subtitle D of title VII, the Ad17 ministrator shall require any person who is an offset 

18 project developer, and may require any person who is a 

19 third-party verifier, to establish and maintain records, for 

20 a period of not less than the crediting period under section 

21 734(c) plus 5 years, relating to— 

22 ‘‘(1) any offset project approval petition sub23 mitted to the appropriate officials under section 735; 

24 ‘‘(2) any reversals which occur with respect to 

25 an offset project; 


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1 ‘‘(3) any verification reports; and 

2 ‘‘(4) any other aspect of the offset project that 

3 the appropriate officials determines is appropriate.’’. 

4 Subtitle B—Disposition of 

5 Allowances 

6 SEC. 111. DISPOSITION OF ALLOWANCES FOR GLOBAL 

7 WARMING POLLUTION REDUCTION PRO8 GRAM. 

9 Title VII of the Clean Air Act (as amended by section 

10 141 of this division) is amended by adding at the end the 

11 following: 

12 ‘‘PART H—DISPOSITION OF ALLOWANCES 

13 ‘‘SEC. 771. ALLOCATION OF EMISSION ALLOWANCES. 

14 ‘‘(a) ALLOCATION.—The Administrator shall allocate 

15 emission allowances for the following purposes: 

16 ‘‘(1) The program for electricity consumers pur17 suant to section 772. 

18 ‘‘(2) The program for natural gas consumers 

19 pursuant to section 773. 

20 ‘‘(3) The program for home heating oil and pro21 pane consumers pursuant to section 774. 

22 ‘‘(4) The program for domestic fuel production, 

23 including petroleum refiners and small business re24 finers, under section 775. 


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1 ‘‘(5) The program to ensure real reductions in 

2 industrial emissions under part F. 

3 ‘‘(6) The program for commercial deployment 

4 of carbon capture and sequesration technologies 

5 under section 780. 

6 ‘‘(7) The program for early action recognition 

7 pursuant to section 782. 

8 ‘‘(8) The program for State and local invest9 ment in energy efficiency and renewable energy 

10 under section 202 of division B of the Clean Energy 

11 Jobs and American Power Act. 

12 ‘‘(9) The program for energy efficiency in build13 ing codes under section 163 of division A, and sec14 tion 203 of division B, of the Clean Energy Jobs 

15 and American Power Act. 

16 ‘‘(10) The program for retrofit for energy and 

17 environmental performance under section 164 of di18 vision A, and 204 of division B, of the Clean Energy 

19 Jobs and American Power Act. 

20 ‘‘(11) The program for Energy Innovation 

21 Hubs pursuant to section 205 of division B of the 

22 Clean Energy Jobs and American Power Act. 

23 ‘‘(12) The program for ARPA–E research pur24 suant to section 206 of division B of the Clean En25 ergy Jobs and American Power Act. 


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1 ‘‘(13) The International Clean Energy Deploy2 ment Program under section 323 of division A, and 

3 section 207 of division B, of the Clean Energy Jobs 

4 and American Power Act. 

5 ‘‘(14) The international climate change adapta6 tion and global security program under section 324 

7 of division A, and section 208 of division B, of the 

8 Clean Energy Jobs and American Power Act. 

9 ‘‘(b) AUCTIONS.—The Administrator shall auction, 

10 pursuant to section 778, emission allowances for the fol11 lowing purposes: 

12 ‘‘(1) The Market Stability Reserve Fund under 

13 section 726. 

14 ‘‘(2) The program for climate change consumer 

15 refunds and low- and moderate-income consumers 

16 pursuant to section 776, including— 

17 ‘‘(A) consumer rebates under section 

18 776(a); and 

19 ‘‘(B) energy refunds under section 776(b). 

20 ‘‘(3) The program for investment in clean vehi21 cle technology under section 201 of division B of the 

22 Clean Energy Jobs and American Power Act. 

23 ‘‘(4) The program for State and local invest24 ment in energy efficiency and renewable energy 


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1 under section 202 of division B of the Clean Energy 

2 Jobs and American Power Act. 

3 ‘‘(5) The program for energy efficiency and re4 newable energy worker training under section 209 of 

5 division B of the Clean Energy Jobs and American 

6 Power Act. 

7 ‘‘(6) The program for worker transition under 

8 part 2 of subtitle A of title III of division A, and 

9 section 210 of division B, of the Clean Energy Jobs 

10 and American Power Act. 

11 ‘‘(7) The State programs for greenhouse gas re12 duction and climate adaptation pursuant to section 

13 211 of division B of the Clean Energy Jobs and 

14 American Power Act. 

15 ‘‘(8) The program for public health and climate 

16 change under subpart B of part 1 of subtitle C of 

17 title III of division A, and section 212 of division B, 

18 of the Clean Energy Jobs and American Power Act. 

19 ‘‘(9) The program for climate change safe20 guards for natural resources conservation under sub21 part C of part 1 of subtitle C of title III of division 

22 A, and section 213 of division B, of the Clean En23 ergy Jobs and American Power Act. 


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1 ‘‘(10) Nuclear worker training under section 

2 132 of division A, and section 214 of division B, of 

3 the Clean Energy Jobs and American Power Act. 

4 ‘‘(11) The supplemental agriculture and for5 estry greenhouse gas reduction and renewable en6 ergy program under section 155 of division A, and 

7 section 215 of division B, of the Clean Energy Jobs 

8 and American Power Act. 

9 ‘‘(c) DEFICIT REDUCTION.— 

10 ‘‘(1) IN GENERAL.—The Administrator shall— 

11 ‘‘(A) auction, pursuant to section 778, 

12 emission allowances for deficit reduction in the 

13 amounts described in paragraph (2); and 

14 ‘‘(B) deposit those proceeds immediately 

15 on receipt in the Deficit Reduction Fund estab16 lished by section 783. 

17 ‘‘(2) AMOUNTS.—For vintage years 2012 

18 through 2050, 25.0 percent of emission allowances 

19 established for each year under section 721(a) shall 

20 be auctioned and the proceeds deposited pursuant to 

21 paragraph (1) to ensure that this title does not con22 tribute to the deficit for that particular calendar 

23 year. 

24 ‘‘(d) SUPPLEMENTAL REDUCTIONS.— 


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1 ‘‘(1) IN GENERAL.—The Administrator shall al2 locate allowances for each vintage year to achieve 

3 supplemental reductions pursuant to section 753. 

4 ‘‘(2) ADJUSTMENT.—The Administrator shall 

5 modify the allowances allocated under paragraph (1) 

6 as necessary to ensure the achievement of the an7 nual supplemental emissions reduction objective for 

8 2020 set forth in section 704. 

9 ‘‘SEC. 772. ELECTRICITY CONSUMERS. 

10 ‘‘(a) DEFINITIONS.—For purposes of this section: 

11 ‘‘(1) CHP SAVINGS.—The term ‘CHP savings’ 

12 means— 

13 ‘‘(A) CHP system savings from a combined 

14 heat and power system that commences oper15 ation after the date of enactment of this sec16 tion; and 

17 ‘‘(B) the increase in CHP system savings 

18 from, at any time after the date of the enact19 ment of this section, upgrading, replacing, ex20 panding, or increasing the utilization of a com21 bined heat and power system that commenced 

22 operation on or before the date of enactment of 

23 this section. 

24 ‘‘(2) CHP SYSTEM SAVINGS.—The term ‘CHP 

25 system savings’ means the increment of electric outVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00579 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 put of a combined heat and power system that is at2 tributable to the higher efficiency of the combined 

3 system (as compared to the efficiency of separate 

4 production of the electric and thermal outputs). 

5 ‘‘(3) COAL-FUELED UNIT.—The term ‘coal6 fueled unit’ means a utility unit that derives at least 

7 85 percent of its heat input from coal, petroleum 

8 coke, or any combination of those 2 fuels. 

9 ‘‘(4) COST-EFFECTIVE.—The term ‘cost-effec10 tive’, with respect to an energy efficiency program, 

11 means that the program meets the total resource 

12 cost test, which requires that the net present value 

13 of economic benefits over the life of the program, in14 cluding avoided supply and delivery costs and de15 ferred or avoided investments, is greater than the 

16 net present value of the economic costs over the life 

17 of the program, including program costs and incre18 mental costs borne by the energy consumer. 

19 ‘‘(5) ELECTRICITY LOCAL DISTRIBUTION COM20 PANY.—The term ‘electricity local distribution com21 pany’ means an electric utility— 

22 ‘‘(A) that has a legal, regulatory, or con23 tractual obligation to deliver electricity directly 

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1 ty sells the electricity as a commodity to those 

2 retail consumers; and 

3 ‘‘(B) the retail rates of which, except in 

4 the case of an electric cooperative, are regulated 

5 or set by— 

6 ‘‘(i) a State regulatory authority; 

7 ‘‘(ii) a State or political subdivision 

8 thereof (or an agency or instrumentality 

9 of, or corporation wholly owned by, either 

10 of the foregoing); or 

11 ‘‘(iii) an Indian tribe pursuant to trib12 al law. 

13 ‘‘(6) ELECTRICITY SAVINGS.—The term ‘elec14 tricity savings’ means reductions in electricity con15 sumption, relative to business-as-usual projections, 

16 achieved through measures implemented after the 

17 date of enactment of this section, limited to— 

18 ‘‘(A) customer facility savings of elec19 tricity, adjusted to reflect any associated in20 crease in fuel consumption at the facility; 

21 ‘‘(B) reductions in distribution system 

22 losses of electricity achieved by a retail elec23 tricity distributor, as compared to losses attrib24 utable to new or replacement distribution sys25 tem equipment of average efficiency; 


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1 ‘‘(C) CHP savings; and 

2 ‘‘(D) fuel cell savings. 

3 ‘‘(7) FUEL CELL.—The term ‘fuel cell’ means a 

4 device that directly converts the chemical energy of 

5 a fuel and an oxidant into electricity by electro6 chemical processes occurring at separate electrodes 

7 in the device. 

8 ‘‘(8) FUEL CELL SAVINGS.—The term ‘fuel cell 

9 savings’ means the electricity saved by a fuel cell 

10 that is installed after the date of enactment of this 

11 section, or by upgrading a fuel cell that commenced 

12 operation on or before the date of enactment of this 

13 section, as a result of the greater efficiency with 

14 which the fuel cell transforms fuel into electricity as 

15 compared with sources of electricity delivered 

16 through the grid, provided that— 

17 ‘‘(A) the fuel cell meets such requirements 

18 relating to efficiency and other operating char19 acteristics as the Federal Energy Regulatory 

20 Commission may promulgate by regulation; and 

21 ‘‘(B) the net sales of electricity from the 

22 fuel cell to customers not consuming the ther23 mal output from the fuel cell, if any, do not ex24 ceed 50 percent of the total annual electricity 

25 generation by the fuel cell. 


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1 ‘‘(9) INDEPENDENT POWER PRODUCTION FA2 CILITY.—The term ‘independent power production 

3 facility’ means a facility— 

4 ‘‘(A) that is used for the generation of 

5 electric energy, at least 80 percent of which is 

6 sold at wholesale; and 

7 ‘‘(B) the sales of the output of which are 

8 not subject to retail rate regulation or setting 

9 of retail rates by— 

10 ‘‘(i) a State regulatory authority; 

11 ‘‘(ii) a State or political subdivision 

12 thereof (or an agency or instrumentality 

13 of, or corporation wholly owned by, either 

14 of the foregoing); 

15 ‘‘(iii) an electric cooperative; or 

16 ‘‘(iv) an Indian tribe pursuant to trib17 al law. 

18 ‘‘(10) LONG-TERM CONTRACT GENERATOR.— 

19 The term ‘long-term contract generator’ means a 

20 qualifying small power production facility, a quali21 fying cogeneration facility ), an independent power 

22 production facility, or a facility for the production of 

23 electric energy for sale to others that is owned and 

24 operated by an electric cooperative that is— 

25 ‘‘(A) a covered entity; and 


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1 ‘‘(B) as of the date of enactment of this 

2 title— 

3 ‘‘(i) a facility with 1 or more sales or 

4 tolling agreements executed before March 

5 1, 2007, that govern the facility’s elec6 tricity sales and provide for sales at a price 

7 (whether a fixed price or a price formula) 

8 for electricity that does not allow for recov9 ery of the costs of compliance with the lim10 itation on greenhouse gas emissions under 

11 this title, provided that such agreements 

12 are not between entities that are affiliates 

13 of one another; or 

14 ‘‘(ii) a facility consisting of 1 or more 

15 cogeneration units that makes useful ther16 mal energy available to an industrial or 

17 commercial process with 1 or more sales 

18 agreements executed before March 1, 

19 2007, that govern the facility’s useful ther20 mal energy sales and provide for sales at 

21 a price (whether a fixed price or price for22 mula) for useful thermal energy that does 

23 not allow for recovery of the costs of com24 pliance with the limitation on greenhouse 

25 gas emissions under this title, provided 


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1 that such agreements are not between enti2 ties that are affiliates of one another. 

3 ‘‘(11) MERCHANT COAL UNIT.—The term ‘mer4 chant coal unit’ means a coal-fueled unit that— 

5 ‘‘(A) is or is part of a covered entity; 

6 ‘‘(B) is not owned by a Federal, State, or 

7 regional agency or power authority; and 

8 ‘‘(C) generates electricity solely for sale to 

9 others, provided that all or a portion of such 

10 sales are made by a separate legal entity that— 

11 ‘‘(i) has a full or partial ownership or 

12 leasehold interest in the unit, as certified 

13 in accordance with such requirements as 

14 the Administrator shall prescribe; and 

15 ‘‘(ii) is not subject to retail rate regu16 lation or setting of retail rates by— 

17 ‘‘(I) a State regulatory authority; 

18 ‘‘(II) a State or political subdivi19 sion thereof (or an agency or instru20 mentality of, or corporation wholly 

21 owned by, either of the foregoing); 

22 ‘‘(III) an electric cooperative; or 

23 ‘‘(IV) an Indian tribe pursuant 

24 to tribal law. 


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1 ‘‘(12) MERCHANT COAL UNIT SALES.—The 

2 term ‘merchant coal unit sales’ means sales to oth3 ers of electricity generated by a merchant coal unit 

4 that are made by the owner or leaseholder described 

5 in paragraph (11)(C). 

6 ‘‘(13) NEW COAL-FUELED UNIT.—The term 

7 ‘new coal-fueled unit’ means a coal-fueled unit that 

8 commenced operation on or after January 1, 2009 

9 and before January 1, 2013. 

10 ‘‘(14) NEW MERCHANT COAL UNIT.—The term 

11 ‘new merchant coal unit’ means a merchant coal 

12 unit— 

13 ‘‘(A) that commenced operation on or after 

14 January 1, 2009 and before January 1, 2013; 

15 and 

16 ‘‘(B) the actual, on-site construction of 

17 which commenced prior to January 1, 2009. 

18 ‘‘(15) QUALIFIED HYDROPOWER.—The term 

19 ‘qualified hydropower’ means— 

20 ‘‘(A) energy produced from increased effi21 ciency achieved, or additions of capacity made, 

22 on or after January 1, 1988, at a hydroelectric 

23 facility that was placed in service before that 

24 date and does not include additional energy 

25 generated as a result of operational changes not 


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1 directly associated with efficiency improvements 

2 or capacity additions; or 

3 ‘‘(B) energy produced from generating ca4 pacity added to a dam on or after January 1, 

5 1988, provided that the Federal Energy Regu6 latory Commission certifies that— 

7 ‘‘(i) the dam was placed in service be8 fore the date of the enactment of this sec9 tion and was operated for flood control, 

10 navigation, or water supply purposes and 

11 was not producing hydroelectric power 

12 prior to the addition of such capacity; 

13 ‘‘(ii) the hydroelectric project installed 

14 on the dam is licensed (or is exempt from 

15 licensing) by the Federal Energy Regu16 latory Commission and is in compliance 

17 with the terms and conditions of the li18 cense or exemption, and with other appli19 cable legal requirements for the protection 

20 of environmental quality, including applica21 ble fish passage requirements; and 

22 ‘‘(iii) the hydroelectric project in23 stalled on the dam is operated so that the 

24 water surface elevation at any given loca25 tion and time that would have occurred in 


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1 the absence of the hydroelectric project is 

2 maintained, subject to any license or ex3 emption requirements that require changes 

4 in water surface elevation for the purpose 

5 of improving the environmental quality of 

6 the affected waterway. 

7 ‘‘(16) QUALIFYING SMALL POWER PRODUCTION

8 FACILITY; QUALIFYING COGENERATION FACILITY.— 

9 The terms ‘qualifying small power production facil10 ity’ and ‘qualifying cogeneration facility’ have the 

11 meanings given those terms in section 3(17)(C) and 

12 3(18)(B) of the Federal Power Act (16 U.S.C. 

13 796(17)(C) and 796(18)(B)). 

14 ‘‘(17) RENEWABLE ENERGY RESOURCE.—The 

15 term ‘renewable energy resource’ means each of the 

16 following: 

17 ‘‘(A) Wind energy. 

18 ‘‘(B) Solar energy. 

19 ‘‘(C) Geothermal energy. 

20 ‘‘(D) Renewable biomass. 

21 ‘‘(E) Biogas derived exclusively from re22 newable biomass. 

23 ‘‘(F) Biofuels derived exclusively from re24 newable biomass. 

25 ‘‘(G) Qualified hydropower. 


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1 ‘‘(H) Marine and hydrokinetic renewable 

2 energy, as that term is defined in section 632 

3 of the Energy Independence and Security Act 

4 of 2007 (42 U.S.C. 17211). 

5 ‘‘(18) SMALL LDC.—The term ‘small LDC’ 

6 means, for any given year, an electricity local dis7 tribution company that delivered less than 4,000,000 

8 megawatt hours of electric energy directly to retail 

9 consumers in the preceding year. 

10 ‘‘(19) STATE REGULATORY AUTHORITY.—The 

11 term ‘State regulatory authority’ has the meaning 

12 given that term in section 3(17) of the Public Utility 

13 Regulatory Policies Act of 1978 (16 U.S.C. 

14 2602(17)). 

15 ‘‘(20) USEFUL THERMAL ENERGY.—The term 

16 ‘useful thermal energy’ has the meaning given that 

17 term in section 371(7) of the Energy Policy and 

18 Conservation Act (42 U.S.C. 6341(7)). 

19 ‘‘(b) ELECTRICITY LOCAL DISTRIBUTION COMPA20 NIES.— 

21 ‘‘(1) DISTRIBUTION OF ALLOWANCES.—The 

22 Administrator shall distribute to electricity local dis23 tribution companies for the benefit of retail rate24 payers the quantity of emission allowances allocated 

25 for the following vintage year pursuant to section 


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1 771(a)(1). Notwithstanding the preceding sentence, 

2 the Administrator shall withhold from distribution 

3 under this subsection a quantity of emission allow4 ances equal to the lesser of 14.3 percent of the 

5 quantity of emission allowances allocated under sec6 tion 771(a)(1) for the relevant vintage year, or 105 

7 percent of the emission allowances for the relevant 

8 vintage year that the Administrator anticipates will 

9 be distributed to merchant coal units and to long10 term contract generators, respectively, under sub11 sections (c) and (d). If not required by subsections 

12 (c) and (d) to distribute all of these reserved allow13 ances, the Administrator shall distribute any remain14 ing emission allowances to electricity local distribu15 tion companies in accordance with this subsection. 

16 ‘‘(2) DISTRIBUTION BASED ON EMISSIONS.— 

17 ‘‘(A) IN GENERAL.—For each vintage year, 

18 50 percent of the emission allowances available 

19 for distribution under paragraph (1), after re20 serving allowances for distribution under sub21 sections (c) and (d), shall be distributed by the 

22 Administrator among individual electricity local 

23 distribution companies ratably based on the an24 nual average carbon dioxide emissions attrib25 utable to generation of electricity delivered at 


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1 retail by each such company during the base 

2 period determined under subparagraph (B). 

3 ‘‘(B) BASE PERIOD.— 

4 ‘‘(i) VINTAGE YEARS 2012 AND 2013.— 

5 For vintage years 2012 and 2013, an elec6 tricity local distribution company’s base 

7 period shall be— 

8 ‘‘(I) calendar years 2006 through 

9 2008; or 

10 ‘‘(II) any 3 consecutive calendar 

11 years between 1999 and 2008, inclu12 sive, that such company selects, pro13 vided that the company timely informs 

14 the Administrator of such selection. 

15 ‘‘(ii) VINTAGE YEARS 2014 AND

16 THEREAFTER.—For vintage years 2014 

17 and thereafter, the base period shall be— 

18 ‘‘(I) the base period selected 

19 under clause (i); or 

20 ‘‘(II) calendar year 2012, in the 

21 case of an electricity local distribution 

22 company that owns, co-owns, or pur23 chases through a power purchase 

24 agreement (whether directly or 

25 through a cooperative arrangement) a 


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1 substantial portion of the electricity 

2 generated by a new coal-fueled unit, 

3 provided that such company timely in4 forms the Administrator of its election 

5 to use 2012 as its base period. 

6 ‘‘(C) DETERMINATION OF EMISSIONS.— 

7 ‘‘(i) DETERMINATION FOR 1999– 

8 2008.—As part of the regulations promul9 gated pursuant to subsection (g), the Ad10 ministrator, after consultation with the 

11 Energy Information Administration, shall 

12 determine the average amount of carbon 

13 dioxide emissions attributable to genera14 tion of electricity delivered at retail by 

15 each electricity local distribution company 

16 for each of the years 1999 through 2008, 

17 taking into account entities’ electricity gen18 eration, electricity purchases, and elec19 tricity sales. In the case of any electricity 

20 local distribution company that owns, co21 owns, or purchases through a power pur22 chase agreement (whether directly or 

23 through a cooperative arrangement) a sub24 stantial portion of the electricity generated 

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1 eration after January 1, 2006, and before 

2 December 31, 2008, the Administrator 

3 shall adjust the emissions attributable to 

4 such company’s retail deliveries in calendar 

5 years 2006 through 2008 to reflect the 

6 emissions that would have occurred if the 

7 relevant unit were in operation during the 

8 entirety of such 3-year period. 

9 ‘‘(ii) ADJUSTMENTS FOR NEW COAL10 FUELED UNITS.— 

11 ‘‘(I) VINTAGE YEARS 2012 AND

12 2013.—For purposes of emission al13 lowance distributions for vintage years 

14 2012 and 2013, in the case of any 

15 electricity local distribution company 

16 that owns, co-owns, or purchases 

17 through a power purchase agreement 

18 (whether directly or through a cooper19 ative arrangement) a substantial por20 tion of the electricity generated by, a 

21 new coal-fueled unit, the Adminis22 trator shall adjust the emissions at23 tributable to such company’s retail de24 liveries in the applicable base period 

25 to reflect the emissions that would 


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1 have occurred if the new coal-fueled 

2 unit were in operation during such pe3 riod. 

4 ‘‘(II) VINTAGE YEAR 2014 AND

5 THEREAFTER.—Not later than nec6 essary for use in making emission al7 lowance distributions under this sub8 section for vintage year 2014, the Ad9 ministrator shall, for any electricity 

10 local distribution company that owns, 

11 co-owns, or purchases through a 

12 power purchase agreement (whether 

13 directly or through a cooperative ar14 rangement) a substantial portion of 

15 the electricity generated by a new 

16 coal-fueled unit and has selected cal17 endar year 2012 as its base period 

18 pursuant to subparagraph (B)(ii)(II), 

19 determine the amount of carbon diox20 ide emissions attributable to genera21 tion of electricity delivered at retail by 

22 such company in calendar year 2012. 

23 If the relevant new coal-fueled unit 

24 was not yet operational by January 1, 

25 2012, the Administrator shall adjust 


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1 such determination to reflect the 

2 emissions that would have occurred if 

3 such unit were in operation for all of 

4 calendar year 2012. 

5 ‘‘(iii) REQUIREMENTS.—Determina6 tions under this paragraph shall be as pre7 cise as practicable, taking into account the 

8 nature of data currently available and the 

9 nature of markets and regulation in effect 

10 in various regions of the country. The fol11 lowing requirements shall apply to such de12 terminations: 

13 ‘‘(I) The Administrator shall de14 termine the amount of fossil fuel15 based electricity delivered at retail by 

16 each electricity local distribution com17 pany, and shall use appropriate emis18 sion factors to calculate carbon diox19 ide emissions associated with the gen20 eration of such electricity. 

21 ‘‘(II) Where it is not practical to 

22 determine the precise fuel mix for the 

23 electricity delivered at retail by an in24 dividual electricity local distribution 

25 company, the Administrator may use 


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1 the best available data, including aver2 age data on a regional basis with ref3 erence to Regional Transmission Or4 ganizations or regional entities (as 

5 that term is defined in section 

6 215(a)(7) of the Federal Power Act 

7 (16 U.S.C. 824o(a)(7)), to estimate 

8 fuel mix and emissions. Different 

9 methodologies may be applied in dif10 ferent regions if appropriate to obtain 

11 the most accurate estimate. 

12 ‘‘(3) DISTRIBUTION BASED ON DELIVERIES.— 

13 ‘‘(A) INITIAL FORMULA.—Except as pro14 vided in subparagraph (B), for each vintage 

15 year, the Administrator shall distribute 50 per16 cent of the emission allowances available for 

17 distribution under paragraph (1), after reserv18 ing allowances for distribution under sub19 sections (c) and (d), among individual elec20 tricity local distribution companies ratably 

21 based on each electricity local distribution com22 pany’s annual average retail electricity deliv23 eries for calendar years 2006 through 2008, un24 less the owner or operator of the company se25 lects 3 other consecutive years between 1999 


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1 and 2008, inclusive, and timely notifies the Ad2 ministrator of its selection. 

3 ‘‘(B) UPDATING.—Prior to distributing 

4 2015 vintage year emission allowances under 

5 this paragraph and at 3-year intervals there6 after, the Administrator shall update the dis7 tribution formula under this paragraph to re8 flect changes in each electricity local distribu9 tion company’s service territory since the most 

10 recent formula was established. For each suc11 cessive 3-year period, the Administrator shall 

12 distribute allowances ratably among individual 

13 electricity local distribution companies based on 

14 the product of— 

15 ‘‘(i) each electricity local distribution 

16 company’s average annual deliveries per 

17 customer during calendar years 2006 

18 through 2008, or during the 3 alternative 

19 consecutive years selected by such company 

20 under subparagraph (A); and 

21 ‘‘(ii) the number of customers of such 

22 electricity local distribution company in the 

23 most recent year in which the formula is 

24 updated under this subparagraph. 


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1 ‘‘(4) PROHIBITION AGAINST EXCESS DISTRIBU2 TIONS.—The regulations promulgated under sub3 section (g) shall ensure that, notwithstanding para4 graphs (2) and (3), no electricity local distribution 

5 company shall receive a greater quantity of allow6 ances under this subsection than is necessary to off7 set any increased electricity costs to such company’s 

8 retail ratepayers, including increased costs attrib9 utable to purchased power costs, due to enactment 

10 of this title. Any emission allowances withheld from 

11 distribution to an electricity local distribution com12 pany pursuant to this paragraph shall be distributed 

13 among all remaining electricity local distribution 

14 companies ratably based on emissions pursuant to 

15 paragraph (2). 

16 ‘‘(5) USE OF ALLOWANCES.— 

17 ‘‘(A) RATEPAYER BENEFIT.—Emission al18 lowances distributed to an electricity local dis19 tribution company under this subsection shall 

20 be used exclusively for the benefit of retail rate21 payers of such electricity local distribution com22 pany and may not be used to support electricity 

23 sales or deliveries to entities or persons other 

24 than such ratepayers. 


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1 ‘‘(B) RATEPAYER CLASSES.—In using 

2 emission allowances distributed under this sub3 section for the benefit of ratepayers, an elec4 tricity local distribution company shall ensure 

5 that ratepayer benefits are distributed— 

6 ‘‘(i) among ratepayer classes ratably 

7 based on electricity deliveries to each class; 

8 and 

9 ‘‘(ii) equitably among individual rate10 payers within each ratepayer class, includ11 ing entities that receive emission allow12 ances pursuant to part F. 

13 ‘‘(C) LIMITATION.—In general, an elec14 tricity local distribution company shall not use 

15 the value of emission allowances distributed 

16 under this subsection to provide to any rate17 payer a rebate that is based solely on the quan18 tity of electricity delivered to such ratepayer. 

19 To the extent an electricity local distribution 

20 company uses the value of emission allowances 

21 distributed under this subsection to provide re22 bates, it shall, to the maximum extent prac23 ticable, provide such rebates with regard to the 

24 fixed portion of ratepayers’ bills or as a fixed 

25 credit or rebate on electricity bills. 


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1 ‘‘(D) RESIDENTIAL AND INDUSTRIAL

2 RATEPAYERS.—Notwithstanding subparagraph 

3 (C), if compliance with the requirements of this 

4 title results (or would otherwise result) in an 

5 increase in electricity costs for residential or in6 dustrial retail ratepayers of any given electricity 

7 local distribution company (including entities 

8 that receive emission allowances pursuant to 

9 part F), such electricity local distribution com10 pany— 

11 ‘‘(i) shall pass through to residential 

12 retail ratepayers as a class their ratable 

13 share (based on deliveries to each rate14 payer class) of the value of the emission al15 lowances that reduce electricity cost im16 pacts on such ratepayers; and 

17 ‘‘(ii) shall pass through to industrial 

18 ratepayers as a class their ratable share 

19 (based on deliveries to each ratepayer 

20 class) of the value of the emission allow21 ances that reduce electricity cost impacts 

22 on such ratepayers. The electricity local 

23 distribution company may do so based on 

24 the quantity of electricity delivered to indi25 vidual industrial retail ratepayers. 


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1 ‘‘(E) GUIDELINES.—As part of the regula2 tions promulgated under subsection (g), the Ad3 ministrator shall, after consultation with State 

4 regulatory authorities, prescribe guidelines for 

5 the implementation of the requirements of this 

6 paragraph. Such guidelines shall include— 

7 ‘‘(i) requirements to ensure that resi8 dential and industrial retail ratepayers (in9 cluding entities that receive emission allow10 ances under part F) receive their ratable 

11 share of the value of the allowances dis12 tributed to each electricity local distribu13 tion company pursuant to this subsection; 

14 and 

15 ‘‘(ii) requirements for measurement, 

16 verification, reporting, and approval of 

17 methods used to assure the use of allow18 ance values to benefit retail ratepayers. 

19 ‘‘(6) REGULATORY PROCEEDINGS.— 

20 ‘‘(A) REQUIREMENT.—No electricity local 

21 distribution company shall be eligible to receive 

22 emission allowances under this subsection or 

23 subsection (e) unless the State regulatory au24 thority with authority over such company’s re25 tail rates, or the entity with authority to reguVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00601 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 late or set retail electricity rates of an elec2 tricity local distribution company not regulated 

3 by a State regulatory authority, has— 

4 ‘‘(i) after public notice and an oppor5 tunity for comment, promulgated a regula6 tion or completed a rate proceeding (or the 

7 equivalent, in the case of a ratemaking en8 tity other than a State regulatory author9 ity) that provides for the full implementa10 tion of the requirements of paragraph (5) 

11 of this subsection and the requirements of 

12 subsection (e); and 

13 ‘‘(ii) made available to the Adminis14 trator and the public a report describing, 

15 in adequate detail, the manner in which 

16 the requirements of paragraph (5) and the 

17 requirements of subsection (e) will be im18 plemented. 

19 ‘‘(B) UPDATING.—The Administrator shall 

20 require, as a condition of continued receipt of 

21 emission allowances under this subsection by an 

22 electricity local distribution company, that a 

23 new regulation be promulgated or rate pro24 ceeding be completed, after public notice and an 

25 opportunity for comment, and a new report be 


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1 made available to the Administrator and the 

2 public, pursuant to subparagraph (A), not less 

3 frequently than every 5 years. 

4 ‘‘(7) PLANS AND REPORTING.— 

5 ‘‘(A) REGULATIONS.—As part of the regu6 lations promulgated under subsection (g), the 

7 Administrator shall prescribe requirements gov8 erning plans and reports to be submitted in ac9 cordance with this paragraph. 

10 ‘‘(B) PLANS.—Not later than April 30 of 

11 2011 and every 5 years thereafter through 

12 2026, each electricity local distribution com13 pany shall submit to the Administrator a plan, 

14 approved by the State regulatory authority or 

15 other entity charged with regulating tor setting 

16 the retail rates of such company, describing 

17 such company’s plans for the disposition of the 

18 value of emission allowances to be received pur19 suant to this subsection and subsection (e), in 

20 accordance with the requirements of this sub21 section and subsection (e). Such plan shall in22 clude a description of the manner in which the 

23 company will provide to industrial retail rate24 payers (including entities that receive emission 


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1 allowances under part F) their ratable share of 

2 the value of such allowances. 

3 ‘‘(C) REPORTS.—Not later than June 30, 

4 2013, and each calendar year thereafter 

5 through 2031, each electricity local distribution 

6 company shall submit a report to the Adminis7 trator, and to the relevant State regulatory au8 thority or other entity charged with regulating 

9 or setting the retail electricity rates of such 

10 company, describing the disposition of the value 

11 of any emission allowances received by such 

12 company in the prior calendar year pursuant to 

13 this subsection and subsection (e), including— 

14 ‘‘(i) a description of sales, transfer, 

15 exchange, or use by the company for com16 pliance with obligations under this title, of 

17 any such emission allowances; 

18 ‘‘(ii) the monetary value received by 

19 the company, whether in money or in some 

20 other form, from the sale, transfer, or ex21 change of any such emission allowances; 

22 ‘‘(iii) the manner in which the com23 pany’s disposition of any such emission al24 lowances complies with the requirements of 

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1 cluding each of the requirements of para2 graph (5) of this subsection, including the 

3 requirement that industrial retail rate4 payers (including entities that receive 

5 emission allowances under part F) receive 

6 their ratable share of the value of such al7 lowances; and 

8 ‘‘(iv) such other information as the 

9 Administrator may require pursuant to 

10 subparagraph (A). 

11 ‘‘(D) PUBLICATION.—The Administrator 

12 shall make available to the public all plans and 

13 reports submitted under this subsection, includ14 ing by publishing such plans and reports on the 

15 Internet. 

16 ‘‘(8) ADMINISTRATOR AUDIT REPORTS.— 

17 ‘‘(A) IN GENERAL.—Each year, the Ad18 ministrator shall audit a representative sample 

19 of electricity local distribution companies to en20 sure that emission allowances distributed under 

21 this subsection have been used exclusively for 

22 the benefit of retail ratepayers and that such 

23 companies are complying with the requirements 

24 of this subsection and of subsection (e), includ25 ing the requirement that residential and indusVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00605 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 trial retail ratepayers (including entities that 

2 receive emission allowances under part F) re3 ceive their ratable share of the value of such al4 lowances. The Administrator shall assess the 

5 degree to which electric local distribution com6 panies have maintained a marginal electric 

7 price signal while protecting consumers on total 

8 cost using the value of emissions allowances. In 

9 selecting companies for audit, the Adminis10 trator shall take into account any credible evi11 dence of noncompliance with such requirements. 

12 The Administrator shall make available to the 

13 public a report describing the results of each 

14 such audit, including by publishing such report 

15 on the Internet. 

16 ‘‘(B) GAO AUDIT REPORT.—Not later 

17 than April 30, 2015, and every 3 years there18 after through 2026, the Comptroller General of 

19 the United States, incorporating results from 

20 the Administrators’ audit report and other rel21 evant information including distribution com22 pany reports, shall conduct an in-depth evalua23 tion and make available to the public a report 

24 on the investments made pursuant to paragraph 

25 (5). Said report shall be made available to the 


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1 State regulatory authority, or the entity with 

2 authority to regulate or set retail electricity 

3 rates in the case of an electricity distribution 

4 company that is not regulated by a State regu5 latory authority, and shall include a description 

6 of how the distribution companies in the audit 

7 meet or fail to meet the requirement of para8 graph (5), including for investments made in 

9 cost-effective end-use energy efficiency pro10 grams, the lifetime and annual energy saving 

11 benefits, and capacity benefits of said pro12 grams. 

13 ‘‘(C) ADMINISTRATOR COST CONTAINMENT

14 REPORT.—Not later than April 30, 2015 and 

15 every 3 years thereafter through 2026, the Ad16 ministrator shall transmit a report to Congress 

17 containing an evaluation of the disposition of 

18 the value of emission allowances received pursu19 ant to this subsection and subsection (e) and 

20 recommendations of ways to more effectively di21 rect the value of allowances to reduce costs for 

22 consumers, contain the overall costs of the 

23 greenhouse gas emissions reduction program, 

24 and meet the pollution reduction targets of the 

25 Act. The Administrator shall make available to 


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1 the public such report, including by publishing 

2 such report on the Internet. 

3 ‘‘(9) ENFORCEMENT.—A violation of any re4 quirement of this subsection or of subsection (e), ir5 respective of approval by a State regulatory author6 ity, shall be a violation of this Act. Each emission 

7 allowance the value of which is used in violation of 

8 the requirements of this subsection or of subsection 

9 (e) shall be a separate violation. 

10 ‘‘(c) MERCHANT COAL UNITS.— 

11 ‘‘(1) QUALIFYING EMISSIONS.—The qualifying 

12 emissions for a merchant coal unit for a given cal13 endar year shall be the product of the number of 

14 megawatt hours of merchant coal unit sales gen15 erated by such unit in such calendar year and the 

16 average carbon dioxide emissions per megawatt hour 

17 generated by such unit during the base period under 

18 paragraph (2), provided that the number of mega19 watt hours in a given calendar year for purposes of 

20 such calculation shall be reduced in proportion to 

21 the portion of such unit’s carbon dioxide emissions 

22 that are either— 

23 ‘‘(A) captured and sequestered in such cal24 endar year; or 


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1 ‘‘(B) attributable to the combustion or gas2 ification of biomass, to the extent that the 

3 owner or operator of the unit is not required to 

4 hold emission allowances for such emissions. 

5 ‘‘(2) BASE PERIOD.—For purposes of this sub6 section, the base period for a merchant coal unit 

7 shall be— 

8 ‘‘(A) calendar years 2006 through 2008; or 

9 ‘‘(B) in the case of a new merchant coal 

10 unit— 

11 ‘‘(i) the first full calendar year of op12 eration of such unit, if such unit com13 mences operation before January 1, 2012; 

14 ‘‘(ii) calendar year 2012, if such unit 

15 commences operation on or after January 

16 1, 2012, and before October 1, 2012; or 

17 ‘‘(iii) calendar year 2013, if such unit 

18 commences operation on or after October 

19 1, 2012, and before January 1, 2013. 

20 ‘‘(3) PHASE-DOWN SCHEDULE.—The Adminis21 trator shall identify an annual phase-down factor, 

22 applicable to distributions to merchant coal units for 

23 each of vintage years 2012 through 2029, that cor24 responds to the overall decline in the amount of 

25 emission allowances allocated to the electricity sector 


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1 in such years pursuant to section 771(a)(1). Such 

2 factor shall— 

3 ‘‘(A) for vintage year 2012, be equal to 

4 1.0; 

5 ‘‘(B) for each of vintage years 2013 

6 through 2029, correspond to the quotient of— 

7 ‘‘(i) the quantity of emission allow8 ances allocated under section 771(a)(1) for 

9 such vintage year; divided by 

10 ‘‘(ii) the quantity of emission allow11 ances allocated under section 771(a)(1) for 

12 vintage year 2012. 

13 ‘‘(4) DISTRIBUTION OF EMISSION ALLOW14 ANCES.—Not later than March 1 of 2013 and each 

15 calendar year through 2030, the Administrator shall 

16 distribute emission allowances of the preceding vin17 tage year to the owner or operator of each merchant 

18 coal unit described in subsection (a)(11)(C) in an 

19 amount equal to the product of— 

20 ‘‘(A) 0.5; 

21 ‘‘(B) the qualifying emissions for such 

22 merchant coal unit for the preceding year, as 

23 determined under paragraph (1); and 


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1 ‘‘(C) the phase-down factor for the pre2 ceding calendar year, as identified under para3 graph (3). 

4 ‘‘(5) ADJUSTMENT.— 

5 ‘‘(A) STUDY.—Not later than July 1, 

6 2014, the Administrator, in consultation with 

7 the Federal Energy Regulatory Commission, 

8 shall complete a study to determine whether the 

9 allocation formula under paragraph (3) is re10 sulting in, or is likely to result in, windfall prof11 its to merchant coal generators or substantially 

12 disparate treatment of merchant coal genera13 tors operating in different markets or regions. 

14 ‘‘(B) REGULATION.—If the Administrator, 

15 in consultation with the Federal Energy Regu16 latory Commission, makes an affirmative find17 ing of windfall profits or disparate treatment 

18 under subparagraph (A), the Administrator 

19 shall, not later than 18 months after the com20 pletion of the study described in subparagraph 

21 (A), promulgate regulations providing for the 

22 adjustment of the allocation formula under 

23 paragraph (3) to mitigate, to the extent prac24 ticable, such windfall profits, if any, and such 

25 disparate treatment, if any. 


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1 ‘‘(6) LIMITATION ON ALLOWANCES.—Notwith2 standing paragraph (4) or (5), for each vintage year 

3 the Administrator shall distribute under this sub4 section no more than 10 percent of the total quan5 tity of emission allowances available for such vintage 

6 year for distribution to the electricity sector under 

7 section 771(a)(1). If the quantity of emission allow8 ances that would otherwise be distributed pursuant 

9 to paragraph (4) or (5) for any vintage year would 

10 exceed such limit, the Administrator shall distribute 

11 10 percent of the total emission allowances available 

12 for distribution under section 771(a)(1) for such vin13 tage year ratably among merchant coal generators 

14 based on the applicable formula under paragraph (4) 

15 or (5). 

16 ‘‘(7) ELIGIBILITY.—The owner or operator of a 

17 merchant coal unit shall not be eligible to receive 

18 emission allowances under this subsection for any 

19 vintage year for which such owner or operator has 

20 elected to receive emission allowances for the same 

21 unit under subsection (d). 

22 ‘‘(d) LONG-TERM CONTRACT GENERATORS.— 

23 ‘‘(1) DISTRIBUTION.—Not later than March 1, 

24 2013, and each calendar year through 2030, the Ad25 ministrator shall distribute to the owner or operator 


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1 of each long-term contract generator a quantity of 

2 emission allowances of the preceding vintage year 

3 that is equal to the sum of— 

4 ‘‘(A) the number of tons of carbon dioxide 

5 emitted as a result of a qualifying electricity 

6 sales agreement referred to in subsection 

7 (a)(10)(B)(i); and 

8 ‘‘(B) the incremental number of tons of 

9 carbon dioxide emitted solely as a result of a 

10 qualifying thermal sales agreement referred to 

11 in subsection (a)(10)(B)(ii), provided that in no 

12 event shall the Administrator distribute more 

13 than 1 emission allowance for the same ton of 

14 emissions. 

15 ‘‘(2) LIMITATION ON ALLOWANCES.—Notwith16 standing paragraph (1), for each vintage year the 

17 Administrator shall distribute under this subsection 

18 no more than 4.3 percent of the total quantity of 

19 emission allowances available for such vintage year 

20 for distribution to the electricity sector under section 

21 771(a)(1). If the quantity of emission allowances 

22 that would otherwise be distributed pursuant to 

23 paragraph (1) for any vintage year would exceed 

24 such limit, the Administrator shall distribute 4.3 

25 percent of the total emission allowances available for 


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1 distribution under section 771(a)(1) for such vintage 

2 year ratably among long-term contract generators 

3 based on paragraph (1). 

4 ‘‘(3) ELIGIBILITY.— 

5 ‘‘(A) FACILITY ELIGIBILITY.—The owner 

6 or operator of a facility shall cease to be eligible 

7 to receive emission allowances under this sub8 section upon the earliest date on which the fa9 cility no longer meets each and every element of 

10 the definition of a long-term contract generator 

11 under subsection (a)(10). 

12 ‘‘(B) CONTRACT ELIGIBILITY.—The owner 

13 or operator of a facility shall cease to be eligible 

14 to receive emission allowances under this sub15 section based on an electricity or thermal sales 

16 agreement referred to in subsection (a)(10)(B) 

17 upon the earliest date that such agreement— 

18 ‘‘(i) expires; 

19 ‘‘(ii) is terminated; or 

20 ‘‘(iii) is amended in any way that 

21 changes the location of the facility, the 

22 price (whether a fixed price or price for23 mula) for electricity or thermal energy sold 

24 under such agreement, the quantity of 

25 electricity or thermal energy sold under the 


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1 agreement, or the expiration or termi2 nation date of the agreement. 

3 ‘‘(4) DEMONSTRATION OF ELIGIBILITY.—To be 

4 eligible to receive allowance distributions under this 

5 subsection, the owner or operator of a long-term 

6 contract generator shall submit each of the following 

7 in writing to the Administrator within 180 days 

8 after the date of enactment of this title, and not 

9 later than September 30 of each vintage year for 

10 which such generator wishes to receive emission al11 lowances: 

12 ‘‘(A) A certificate of representation de13 scribed in section 700(15). 

14 ‘‘(B) An identification of each owner and 

15 each operator of the facility. 

16 ‘‘(C) An identification of the units at the 

17 facility and the location of the facility. 

18 ‘‘(D) A written certification by the des19 ignated representative that the facility meets all 

20 the requirements of the definition of a long21 term contract generator. 

22 ‘‘(E) The expiration date of each quali23 fying electricity or thermal sales agreement re24 ferred to in subsection (a)(10)(B). 


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1 ‘‘(F) A copy of each qualifying electricity 

2 or thermal sales agreement referred to in sub3 section (a)(10)(B). 

4 ‘‘(5) NOTIFICATION.—Not later than 30 days 

5 after, in accordance with paragraph (3), a facility or 

6 an agreement ceases to meet the eligibility require7 ments for distribution of emission allowances pursu8 ant to this subsection, the designated representative 

9 of such facility shall notify the Administrator in 

10 writing when, and on what basis, such facility or 

11 agreement ceased to meet such requirements. 

12 ‘‘(e) SMALL LDCs.— 

13 ‘‘(1) DISTRIBUTION.—The Administrator shall, 

14 in accordance with this subsection, distribute emis15 sion allowances allocated pursuant to section 

16 771(a)(1) for the following vintage year. Such allow17 ances shall be distributed ratably among small 

18 LDCs based on historic emissions in accordance with 

19 the same measure of such emissions applied to each 

20 such small LDC for the relevant vintage year under 

21 subsection (b)(2) of this section. 

22 ‘‘(2) USES.—A small LDC receiving allowances 

23 under this section shall use such allowances exclu24 sively for the following purposes: 


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1 ‘‘(A) Cost-effective programs to achieve 

2 electricity savings, provided that such savings 

3 shall not be transferred or used for compliance 

4 with any renewable electricity standard estab5 lished under the Public Utility Regulatory Poli6 cies Act of 1978 (16 U.S.C. 2601 et seq.). 

7 ‘‘(B) Deployment of technologies to gen8 erate electricity from renewable energy re9 sources, provided that any Federal renewable 

10 electricity credits issued based on generation 

11 supported under this section shall be submitted 

12 to the Federal Energy Regulatory Commission 

13 for voluntary retirement and shall not be used 

14 for compliance with the Public Utility Regu15 latory Policies Act of 1978 (16 U.S.C. 2601 et 

16 seq.). 

17 ‘‘(C) Assistance programs to reduce elec18 tricity costs for low-income residential rate19 payers of such small LDC, provided that such 

20 assistance is made available equitably to all res21 idential ratepayers below a certain income level, 

22 which shall not be higher than 200 percent of 

23 the poverty line (as that term is defined in sec24 tion 673(2) of the Community Services Block 

25 Grant Act (42 U.S.C. 9902(2)). 


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1 ‘‘(3) REQUIREMENTS.—As part of the regula2 tions promulgated under subsection (g), the Admin3 istrator shall prescribe— 

4 ‘‘(A) after consultation with the Federal 

5 Energy Regulatory Commission, requirements 

6 to ensure that programs and projects under 

7 paragraph (2)(A) and (B) are consistent with 

8 the standards established by, and effectively 

9 supplement electricity savings and generation of 

10 electricity from renewable energy resources 

11 achieved by, the Combined Efficiency and Re12 newable Electricity Standard established by 

13 law; 

14 ‘‘(B) eligibility criteria and guidelines for 

15 consumer assistance programs for low-income 

16 residential ratepayers under paragraph (2)(C); 

17 and 

18 ‘‘(C) such other requirements as the Ad19 ministrator determines appropriate to ensure 

20 compliance with the requirements of this sub21 section. 

22 ‘‘(4) REPORTING.—Reports submitted under 

23 subsection (b)(7) shall include, in accordance with 

24 such requirements as the Administrator may pre25 scribe— 


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1 ‘‘(A) a description of any facilities de2 ployed under paragraph (2)(A), the quantity of 

3 resulting electricity generation from renewable 

4 energy resources; 

5 ‘‘(B) an assessment demonstrating the 

6 cost-effectiveness of, and electricity savings 

7 achieved by, programs supported under para8 graph (2)(B); and 

9 ‘‘(C) a description of assistance provided to 

10 low-income retail ratepayers under paragraph 

11 (2)(C). 

12 ‘‘(f) CERTAIN COGENERATION FACILITIES.— 

13 ‘‘(1) ELIGIBLE COGENERATION FACILITIES.— 

14 For purposes of this subsection, an ‘eligible cogen15 eration facility’ is a facility that— 

16 ‘‘(A) is a qualifying co-generation facility 

17 (as that term is defined in section 3(18)(B) of 

18 the Federal Power Act (16 U.S.C. 796(18)(B)); 

19 ‘‘(B) derives 80 percent or more of its heat 

20 input from coal, petroleum coke, or any com21 bination of these 2 fuels; 

22 ‘‘(C) has a nameplate capacity of 100 

23 megawatts or greater; 

24 ‘‘(D) was in operation as of January 1, 

25 2009, and remains in operation as of the date 


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1 of any distribution of emission allowances under 

2 this subsection; 

3 ‘‘(E) in calendar years 2006 through 2008 

4 sold, and as of the date of any distribution of 

5 emission allowances under this section sells, 

6 steam or electricity directly and solely to mul7 tiple, separately owned industrial or commercial 

8 facilities co-located at the same site with the co9 generation facility; and 

10 ‘‘(F) is not eligible to receive allowances 

11 under any other subsection of this section or 

12 under part F of this title. 

13 ‘‘(2) DISTRIBUTION.—The Administrator shall 

14 distribute the emission allowances allocated pursuant 

15 to section 771(a)(1) to owners or operators of eligi16 ble cogeneration facilities ratably based on the car17 bon dioxide emissions of each such facility in cal18 endar years 2006 through 2008. The Adminis19 trator— 

20 ‘‘(A) shall not, in any year, distribute 

21 emission allowances under this subsection to the 

22 owner or operator of any eligible cogeneration 

23 facility in excess of the amount necessary to 

24 offset such facility’s cost of compliance with the 

25 requirements of this title in that year; and 


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1 ‘‘(B) may distribute such allowances over a 

2 period of years if annual distributions under 

3 this subsection would otherwise exceed the limi4 tation in subparagraph (A), provided that in no 

5 event shall distributions be made under this 

6 subsection after calendar year 2025. 

7 ‘‘(3) REQUIREMENTS.—The Administrator 

8 shall, by regulation, establish requirements to ensure 

9 that the value of any emission allowances distributed 

10 pursuant to this subsection are passed through, on 

11 an equitable basis, to the facilities to which the rel12 evant cogeneration facility provides electricity or 

13 steam deliveries, including any facility owned or op14 erated by the owner or operator of the cogeneration 

15 facility. 

16 ‘‘(g) REGULATIONS.—Not later than 2 years after 

17 the date of enactment of this title, the Administrator, in 

18 consultation with the Federal Energy Regulatory Commis19 sion, shall promulgate regulations to implement the re20 quirements of this section. 

21 ‘‘SEC. 773. NATURAL GAS CONSUMERS. 

22 ‘‘(a) DEFINITION.—For purposes of this section, the 

23 term ‘cost-effective’, with respect to an energy efficiency 

24 program, means that the program meets the Total Re25 source Cost Test, which requires that the net present 


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1 value of economic benefits over the life of the program, 

2 including avoided supply and delivery costs and deferred 

3 or avoided investments, is greater than the net present 

4 value of the economic costs over the life of the program, 

5 including program costs and incremental costs borne by 

6 the energy consumer. 

7 ‘‘(b) ALLOCATION.—Not later than June 30, 2015, 

8 and each calendar year thereafter through 2028, the Ad9 ministrator shall distribute to natural gas local distribu10 tion companies for the benefit of retail ratepayers the 

11 quantity of emission allowances allocated for the following 

12 vintage year pursuant to section 771(a)(2). Such allow13 ances shall be distributed among local natural gas dis14 tribution companies based on the following formula: 

15 ‘‘(1) INITIAL FORMULA.—Except as provided in 

16 paragraph (2), for each vintage year, the Adminis17 trator shall distribute emission allowances among 

18 natural gas local distribution companies on a pro 

19 rata basis based on each such company’s annual av20 erage retail natural gas deliveries for 2006 through 

21 2008, unless the owner or operator of the company 

22 selects 3 other consecutive years between 1999 and 

23 2008, inclusive, and timely notifies the Adminis24 trator of its selection. 


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1 ‘‘(2) UPDATING.—Prior to distributing 2019 

2 vintage emission allowances and at 3-year intervals 

3 thereafter, the Administrator shall update the dis4 tribution formula under this subsection to reflect 

5 changes in each natural gas local distribution com6 pany’s service territory since the most recent for7 mula was established. For each successive 3-year pe8 riod, the Administrator shall distribute allowances 

9 on a pro rata basis among natural gas local distribu10 tion companies based on the product of— 

11 ‘‘(A) each natural gas local distribution 

12 company’s average annual natural gas deliveries 

13 per customer during calendar years 2006 

14 through 2008, or during the 3 alternative con15 secutive years selected by such company under 

16 paragraph (1); and 

17 ‘‘(B) the number of customers of such nat18 ural gas local distribution company in the most 

19 recent year in which the formula is updated 

20 under this paragraph. 

21 ‘‘(c) USE OF ALLOWANCES.— 

22 ‘‘(1) RATEPAYER BENEFIT.—Emission allow23 ances distributed to a natural gas local distribution 

24 company under this section shall be used exclusively 

25 for the benefit of retail ratepayers of such natural 


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1 gas local distribution company and may not be used 

2 to support natural gas sales or deliveries to entities 

3 or persons other than such ratepayers. 

4 ‘‘(2) RATEPAYER CLASSES.—In using emission 

5 allowances distributed under this section for the ben6 efit of ratepayers, a natural gas local distribution 

7 company shall ensure that ratepayer benefits are 

8 distributed— 

9 ‘‘(A) among ratepayer classes on a pro 

10 rata basis based on natural gas deliveries to 

11 each class; and 

12 ‘‘(B) equitably among individual ratepayers 

13 within each ratepayer class. 

14 ‘‘(3) LIMITATION.—A natural gas local dis15 tribution company shall not use the value of emis16 sion allowances distributed under this section to pro17 vide to any ratepayer a rebate that is based solely 

18 on the quantity of natural gas delivered to such 

19 ratepayer. To the extent a natural gas local distribu20 tion company uses the value of emission allowances 

21 distributed under this section to provide rebates, it 

22 shall, to the maximum extent practicable, provide 

23 such rebates with regard to the fixed portion of rate24 payers’ bills or as a fixed creditor rebate on natural 

25 gas bills. 


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1 ‘‘(4) ENERGY EFFICIENCY PROGRAMS.—The 

2 value of no less than one-third of the emission allow3 ances distributed to natural gas local distribution 

4 companies pursuant to this section in any calendar 

5 year shall be used for cost-effective energy efficiency 

6 programs for natural gas consumers. Such programs 

7 must be authorized and overseen by the State regu8 latory authority, or by the entity with regulatory au9 thority over retail natural gas rates in the case of 

10 a natural gas local distribution company that is not 

11 regulated by a State regulatory authority. 

12 ‘‘(5) GUIDELINES.—As part of the regulations 

13 promulgated under subsection (h), the Administrator 

14 shall prescribe specific guidelines for the implemen15 tation of the requirements of this subsection. 

16 ‘‘(d) REGULATORY PROCEEDINGS.— 

17 ‘‘(1) REQUIREMENT.—No natural gas local dis18 tribution company shall be eligible to receive emis19 sion allowances under this section unless the State 

20 regulatory authority with authority over such com21 pany, or the entity with authority to regulate retail 

22 rates of a natural gas local distribution company not 

23 regulated by a State regulatory authority, has— 

24 ‘‘(A) promulgated a regulation or com25 pleted a rate proceeding (or the equivalent, in 


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1 the case of a ratemaking entity other than a 

2 State regulatory authority) that provides for 

3 the full implementation of the requirements of 

4 subsection (c); and 

5 ‘‘(B) made available to the Administrator 

6 and the public a report describing, in adequate 

7 detail, the manner in which the requirements of 

8 subsection (c) will be implemented. 

9 ‘‘(2) UPDATING.—The Administrator shall re10 quire, as a condition of continued receipt of emission 

11 allowances under this section, that a new regulation 

12 be promulgated or rate proceeding be completed, and 

13 a new report be made available to the Administrator 

14 and the public, pursuant to paragraph (1), not less 

15 frequently than every 5 years. 

16 ‘‘(e) PLANS AND REPORTING.— 

17 ‘‘(1) REGULATIONS.—As part of the regulations 

18 promulgated under subsection (h), the Administrator 

19 shall prescribe requirements governing plans and re20 ports to be submitted in accordance with this sub21 section. 

22 ‘‘(2) PLANS.—Not later than April 30, 2015, 

23 and every 5 years thereafter through 2025, each 

24 natural gas local distribution company shall submit 

25 to the Administrator a plan, approved by the State 


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1 regulatory authority or other entity charged with 

2 regulating the retail rates of such company, describ3 ing such company’s plans for the disposition of the 

4 value of emission allowances to be received pursuant 

5 to this section, in accordance with the requirements 

6 of this section. 

7 ‘‘(3) REPORTS.—Not later than June 30, 2017, 

8 and each calendar year thereafter through 2031, 

9 each natural gas local distribution company shall 

10 submit a report to the Administrator, approved by 

11 the relevant State regulatory authority or other enti12 ty charged with regulating the retail natural gas 

13 rates of such company, describing the disposition of 

14 the value of any emission allowances received by 

15 such company in the prior calendar year pursuant to 

16 this subsection, including— 

17 ‘‘(A) a description of sales, transfer, ex18 change, or use by the company for compliance 

19 with obligations under this title, of any such 

20 emission allowances; 

21 ‘‘(B) the monetary value received by the 

22 company, whether in money or in some other 

23 form, from the sale, transfer, or exchange of 

24 emission allowances received by the company 

25 under this section; 


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1 ‘‘(C) the manner in which the company’s 

2 disposition of emission allowances received 

3 under this subsection complies with the require4 ments of this section, including each of the re5 quirements of subsection (c); 

6 ‘‘(D) the cost-effectiveness of, and energy 

7 savings achieved by, energy efficiency programs 

8 supported through such emission allowances; 

9 and 

10 ‘‘(E) such other information as the Admin11 istrator may require pursuant to paragraph (1). 

12 ‘‘(4) PUBLICATION.—The Administrator shall 

13 make available to the public all plans and reports 

14 submitted by natural gas local distribution compa15 nies under this subsection, including by publishing 

16 such plans and reports on the Internet. 

17 ‘‘(f) AUDITING.— 

18 ‘‘(1) ADMINISTRATOR AUDIT REPORT.—Each 

19 year, the Administrator shall audit a significant rep20 resentative sample of natural gas local distribution 

21 companies to ensure that emission allowances dis22 tributed under this section have been used exclu23 sively for the benefit of retail ratepayers and that 

24 such companies are complying with the requirements 

25 of this section. In selecting companies for audit, the 


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1 Administrator shall take into account any credible 

2 evidence of noncompliance with such requirements. 

3 The Administrator shall make available to the public 

4 a report describing the results of each such audit, 

5 including by publishing such report on the Internet. 

6 ‘‘(2) GAO AUDIT REPORT.—Not later April 30, 

7 2015 and every 3 years thereafter through April 30, 

8 2026, the Comptroller General of the United States, 

9 incorporating results from the Administrators’ audit 

10 report and other relevant information including dis11 tribution company reports, shall conduct an in-depth 

12 evaluation and make available to the public a report 

13 on the investments made pursuant to subsection (c). 

14 Said report shall be made available to the State reg15 ulatory authority, or the entity with authority to 

16 regulate or set retail natural gas rates in the case 

17 of a natural gas distribution company that is not 

18 regulated by a State regulatory authority, and shall 

19 include a description how the distribution companies 

20 in the audit meet or fail to meet the requirement of 

21 subsection (c), including for investments made in 

22 cost-effective end-use energy efficiency programs, the 

23 lifetime and annual energy saving benefits, and ca24 pacity benefits of said programs. 


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1 ‘‘(3) ADMINISTRATOR COST CONTAINMENT RE2 PORT.—Not later April 30, 2015, and every 3 years 

3 thereafter through April 30, 2026, the Adminis4 trator shall transmit a report to Congress containing 

5 an evaluation of the disposition of the value of emis6 sion allowances received pursuant to this subsection 

7 and recommendations of ways to more effectively di8 rect the value of allowances to reduce costs for con9 sumers, contain the overall costs of the greenhouse 

10 gas emissions reduction program, and meet the pol11 lution reduction targets of the Act. The Adminis12 trator shall make available to the public such report, 

13 including by publishing such report on the Internet. 

14 ‘‘(g) ENFORCEMENT.—A violation of any require15 ment of this section, irrespective of approval by a State 

16 regulatory authority, shall be a violation of this Act. Each 

17 emission allowance the value of which is used in violation 

18 of the requirements of this section shall be a separate vio19 lation. 

20 ‘‘(h) REGULATIONS.—Not later than January 1, 

21 2014, the Administrator, in consultation with the Federal 

22 Energy Regulatory Commission, shall promulgate regula23 tions to implement the requirements of this section. 

24 ‘‘SEC. 774. HOME HEATING OIL AND PROPANE CONSUMERS. 

25 ‘‘(a) DEFINITIONS.—For purposes of this section: 


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1 ‘‘(1) CARBON CONTENT.—The term ‘carbon 

2 content’ means the amount of carbon dioxide that 

3 would be emitted as a result of the combustion of a 

4 fuel. 

5 ‘‘(2) COST-EFFECTIVE.—The term ‘cost-effec6 tive’ has the meaning given that term in section 

7 773(a). 

8 ‘‘(b) ALLOCATION.—The Administrator shall dis9 tribute among the States, in accordance with this section, 

10 the quantity of emission allowances allocated pursuant to 

11 section 771(a)(3). The Administrator shall distribute a 

12 percentage of such allowances determined by the Adminis13 trator, after consultation with the Secretary of the Inte14 rior, pursuant to subsection (f). 

15 ‘‘(c) DISTRIBUTION AMONG STATES.—The Adminis16 trator shall distribute emission allowances among the 

17 States under this section each year on a pro rata basis 

18 based on the ratio of— 

19 ‘‘(1) the carbon content of home heating oil and 

20 propane sold to consumers within each State in the 

21 preceding year for residential or commercial uses; to 

22 ‘‘(2) the carbon content of home heating oil and 

23 propane sold to consumers within the United States 

24 in the preceding year for residential or commercial 

25 uses. 


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1 ‘‘(d) USE OF ALLOWANCES.— 

2 ‘‘(1) IN GENERAL.—States shall use emission 

3 allowances distributed under this section exclusively 

4 for the benefit of consumers of home heating oil or 

5 propane for residential or commercial purposes. 

6 Such proceeds shall be used exclusively for— 

7 ‘‘(A) cost-effective energy efficiency pro8 grams for consumers that use home heating oil 

9 or propane for residential or commercial pur10 poses; or 

11 ‘‘(B) rebates or other direct financial as12 sistance programs for consumers of home heat13 ing oil or propane used for residential or com14 mercial purposes. 

15 ‘‘(2) ADMINISTRATION AND DELIVERY MECHA16 NISMS.—In administering programs supported by 

17 this section, States shall— 

18 ‘‘(A) use no less than 50 percent of the 

19 value of emission allowances received under this 

20 section for cost-effective energy efficiency pro21 grams to reduce consumers’ overall fuel costs; 

22 ‘‘(B) to the extent practicable, deliver con23 sumer support under this section through exist24 ing energy efficiency and consumer energy as25 sistance programs or delivery mechanisms, inVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00632 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 cluding, where appropriate, programs or mecha2 nisms administered by parties other than the 

3 State; and 

4 ‘‘(C) seek to coordinate the administration 

5 and delivery of energy efficiency and consumer 

6 energy assistance programs supported under 

7 this section, with one another and with existing 

8 programs for various fuel types, so as to deliver 

9 comprehensive, fuel-blind, coordinated programs 

10 to consumers. 

11 ‘‘(e) REPORTING.—Each State receiving emission al12 lowances under this section shall submit to the Adminis13 trator, within 12 months of each receipt of such allow14 ances, a report, in accordance with such requirements as 

15 the Administrator may prescribe, that— 

16 ‘‘(1) describes the State’s use of emission allow17 ances distributed under this section, including a de18 scription of the energy efficiency and consumer as19 sistance programs supported with such allowances; 

20 ‘‘(2) demonstrates the cost-effectiveness of, and 

21 the energy savings achieved by, energy efficiency 

22 programs supported under this section; and 

23 ‘‘(3) includes a report prepared by an inde24 pendent third party, in accordance with such regula25 tions as the Administrator may promulgate, evaluVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00633 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 ating the performance of the energy efficiency and 

2 consumer assistance programs supported under this 

3 section. 

4 ‘‘(f) ENFORCEMENT.—If the Administrator deter5 mines that a State is not in compliance with this section, 

6 the Administrator may withhold a portion of the emission 

7 allowances, the quantity of which is equal to up to twice 

8 the quantity of the allowances that the State failed to use 

9 in accordance with the requirements of this section, that 

10 such State would otherwise be eligible to receive under this 

11 section in later years. Allowances withheld pursuant to 

12 this subsection shall be distributed among the remaining 

13 States on a pro rata basis in accordance with the formula 

14 in subsection (c). 

15 ‘‘SEC. 775. DOMESTIC FUEL PRODUCTION. 

16 ‘‘(a) PURPOSE.—The purpose of this section is to 

17 provide emission allowance rebates to petroleum refineries 

18 in the United States in a manner that promotes energy 

19 efficiency and a reduction in greenhouse gas emissions at 

20 such facilities. 

21 ‘‘(b) DEFINITIONS.—In this section: 

22 ‘‘(1) EMISSIONS.—The term ‘emissions’ in23 cludes direct emissions from fuel combustion, proc24 ess emissions, and indirect emissions from the gen25 eration of electricity, steam, and hydrogen used to 


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1 produce the output of a petroleum refinery or the 

2 petroleum refinery sector. 

3 ‘‘(2) PETROLEUM REFINERY.—The term ‘petro4 leum refinery’ means a facility classified under code 

5 324110 of the North American Industrial Classifica6 tion System of 2002. 

7 ‘‘(3) SMALL BUSINESS REFINER.—The term 

8 ‘small business refiner’ means a refiner that meets 

9 the applicable Federal refinery capacity and em10 ployee limitations criteria described in section 

11 45H(c)(1) of the Internal Revenue Code of 1986 (as 

12 in effect on the date of enactment of this section and 

13 without regard to section 45H(d)). Eligibility of a 

14 small business refiner under this paragraph shall not 

15 be recalculated or disallowed on account of (i) its 

16 merger with another small business refiner or refin17 ers after December 31, 2002, or (ii) its acquisition 

18 of another small business refiner (or refinery of such 

19 refiner) after December 31, 2002. 

20 ‘‘(c) IN GENERAL.—The Administrator shall dis21 tribute allowances pursuant to this section to owners and 

22 operators of petroleum refineries, including small business 

23 refiners, in the United States. 

24 ‘‘(d) DISTRIBUTION SCHEDULE.—The Administrator 

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1 lations issued under subsection (e) for each vintage year 

2 no later than October 31 of the preceding calendar year. 

3 ‘‘(e) REGULATIONS.—Not later than 3 years after the 

4 date of enactment of this title, the Administrator, in con5 sultation with the Administrator of the Energy Informa6 tion Administration, shall promulgate regulations that es7 tablish a formula for distributing emission allowances con8 sistent with the purpose of this section. In establishing 

9 such formula, the Administrator shall consider the relative 

10 complexity of refinery processes and appropriate mecha11 nisms to take energy efficiency and greenhouse gas reduc12 tions into account. If a petroleum refinery’s electricity pro13 vider received a free allocation of emission allowances pur14 suant to section 771(a)(1), the Administrator shall take 

15 this free allocation into account when establishing such 

16 formula to avoid rebates to a petroleum refinery for costs 

17 that the Administrator determines were not incurred by 

18 the petroleum refinery because the allowances were freely 

19 allocated to the petroleum refinery’s electricity provider 

20 and used for the benefit of the petroleum refinery. This 

21 formula shall apply separately to the distribution of allow22 ances allocated pursuant to section 771(a)(4), including 

23 for petroleum refiners and small business refiners. 

24 ‘‘SEC. 776. CONSUMER PROTECTION. 

25 ‘‘(a) CONSUMER REBATES.— 


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1 ‘‘(1) ESTABLISHMENT OF FUND.—There is es2 tablished in the Treasury a separate account, to be 

3 known as the ‘Consumer Rebate Fund’). 

4 ‘‘(2) AVAILABILITY OF AMOUNTS.—All amounts 

5 deposited in the Consumer Rebate Fund shall be 

6 available without further appropriation or fiscal year 

7 limitation. 

8 ‘‘(3) DISTRIBUTION OF AMOUNTS.—Beginning 

9 in 2026, for each year after deposits are made in the 

10 Consumer Rebate Fund pursuant to section 

11 771(b)(2)(A), the President shall use the funds in 

12 accordance with Federal statutory authority to pro13 vide relief to consumers and others affected by the 

14 enactment of the Clean Energy Jobs and American 

15 Power Act (and amendments made by that Act). 

16 ‘‘(b) ENERGY REFUND PROGRAM.— 

17 ‘‘(1) ESTABLISHMENT OF FUND.—There is es18 tablished in the Treasury a separate account, to be 

19 known as the ‘Energy Refund Account’). 

20 ‘‘(2) AVAILABILITY OF AMOUNTS.—All amounts 

21 deposited in the Energy Refund Account shall be 

22 available without further appropriation or fiscal year 

23 limitation. 

24 ‘‘(3) DISTRIBUTION OF AMOUNTS.—For each 

25 year after deposits are made to the Energy Refund 


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1 Account pursuant to section 771(b)(2)(B), the 

2 President shall use the funds in accordance with 

3 Federal statutory authority to offset energy cost im4 pacts on low- and moderate-income households. 

5 ‘‘SEC. 777. EXCHANGE FOR STATE-ISSUED ALLOWANCES. 

6 ‘‘(a) IN GENERAL.—Not later than 1 year after the 

7 date of enactment of this title, the Administrator shall 

8 issue regulations allowing any person in the United States 

9 to exchange greenhouse gas emission allowances issued be10 fore the later of December 31, 2011, or the date that is 

11 9 months after the first auction under section 778, by the 

12 State of California or for the Regional Greenhouse Gas 

13 Initiative, or the Western Climate Initiative (in this sec14 tion referred to as ‘State allowances’) for emission allow15 ances established by the Administrator under section 

16 721(a). 

17 ‘‘(b) REGULATIONS.—Regulations issued under sub18 section (a) shall— 

19 ‘‘(1) provide that a person exchanging State al20 lowances under this section receive emission allow21 ances established under section 721(a) in the 

22 amount that is sufficient to compensate for the cost 

23 of obtaining and holding such State allowances; 

24 ‘‘(2) establish a deadline by which persons must 

25 exchange the State allowances; 


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1 ‘‘(3) provide that the Federal emission allow2 ances disbursed pursuant to this section shall be de3 ducted from the allowances to be auctioned pursuant 

4 to section 771(b); and 

5 ‘‘(4) require that, once exchanged, the credit or 

6 other instrument be retired for purposes of use 

7 under the program by or for which it was originally 

8 issued. 

9 ‘‘(c) COST OF OBTAINING STATE ALLOWANCE.—For 

10 purposes of this section, the cost of obtaining a State al11 lowance shall be the average auction price, for emission 

12 allowances issued in the year in which the State allowance 

13 was issued, under the program under which the State al14 lowance was issued. 

15 ‘‘SEC. 778. AUCTION PROCEDURES. 

16 ‘‘(a) IN GENERAL.—To the extent that auctions of 

17 emission allowances by the Administrator are authorized 

18 by this part, such auctions shall be carried out pursuant 

19 to this section and the regulations established hereunder. 

20 ‘‘(b) INITIAL REGULATIONS.—Not later than 12 

21 months after the date of enactment of this title, the Ad22 ministrator, in consultation with other agencies, as appro23 priate, shall promulgate regulations governing the auction 

24 of allowances under this section. Such regulations shall in25 clude the following requirements: 


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1 ‘‘(1) FREQUENCY; FIRST AUCTION.—Auctions 

2 shall be held four times per year at regular intervals, 

3 with the first auction to be held no later than March 

4 31, 2011. 

5 ‘‘(2) AUCTION SCHEDULE; CURRENT AND FU6 TURE VINTAGES.—The Administrator shall, at each 

7 quarterly auction under this section, offer for sale 

8 both a portion of the allowances with the same vin9 tage year as the year in which the auction is being 

10 conducted and a portion of the allowances with vin11 tage years from future years. The preceding sen12 tence shall not apply to auctions held before 2012, 

13 during which period, by necessity, the Administrator 

14 shall auction only allowances with a vintage year 

15 that is later than the year in which the auction is 

16 held. Beginning with the first auction and at each 

17 quarterly auction held thereafter, the Administrator 

18 may offer for sale allowances with vintage years of 

19 up to 4 years after the year in which the auction is 

20 being conducted. 

21 ‘‘(3) AUCTION FORMAT.—Auctions shall follow 

22 a single-round, sealed-bid, uniform price format. 

23 ‘‘(4) PARTICIPATION; FINANCIAL ASSURANCE.— 

24 Auctions shall be open to any person, except that 

25 the Administrator may establish financial assurance 


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1 requirements to ensure that auction participants can 

2 and will perform on their bids. 

3 ‘‘(5) DISCLOSURE OF BENEFICIAL OWNER4 SHIP.—Each bidder in the auction shall be required 

5 to disclose the person or entity sponsoring or bene6 fitting from the bidder’s participation in the auction 

7 if such person or entity is, in whole or in part, other 

8 than the bidder. 

9 ‘‘(6) PURCHASE LIMITS.—No person may, di10 rectly or in concert with another participant, pur11 chase more than 5 percent of the allowances offered 

12 for sale at any quarterly auction. 

13 ‘‘(7) PUBLICATION OF INFORMATION.—After 

14 the auction, the Administrator shall, in a timely 

15 fashion, publish the identities of winning bidders, 

16 the quantity of allowances obtained by each winning 

17 bidder, and the auction clearing price. 

18 ‘‘(8) OTHER REQUIREMENTS.—The Adminis19 trator may include in the regulations such other re20 quirements or provisions as the Administrator, in 

21 consultation with other agencies, as appropriate, 

22 considers appropriate to promote effective, efficient, 

23 transparent, and fair administration of auctions 

24 under this section. 


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1 ‘‘(c) REVISION OF REGULATIONS.—The Adminis2 trator may, in consultation with other agencies, as appro3 priate, at any time, revise the initial regulations promul4 gated under subsection (b) by promulgating new regula5 tions. Such revised regulations need not meet the require6 ments identified in subsection (b) if the Administrator de7 termines that an alternative auction design would be more 

8 effective, taking into account factors including costs of ad9 ministration, transparency, fairness, and risks of collusion 

10 or manipulation. In determining whether and how to re11 vise the initial regulations under this subsection, the Ad12 ministrator shall not consider maximization of revenues to 

13 the Federal Government. 

14 ‘‘(d) RESERVE AUCTION PRICE.—The minimum re15 serve auction price shall be $10 (in constant 2005 dollars) 

16 for auctions occurring in 2012. The minimum reserve 

17 price for auctions occurring in years after 2012 shall be 

18 the minimum reserve auction price for the previous year 

19 increased by 5 percent plus the rate of inflation (as meas20 ured by the Consumer Price Index for all urban con21 sumers). 

22 ‘‘(e) DELEGATION OR CONTRACT.—Pursuant to reg23 ulations under this section, the Administrator may by del24 egation or contract provide for the conduct of auctions 

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1 ments or agencies of the Federal Government or by non2 governmental agencies, groups, or organizations. 

3 ‘‘(f) SMALL BUSINESS REFINER RESERVE.—The Ad4 ministrator shall, in accordance with this subsection, issue 

5 regulations setting aside a specified number of allowances, 

6 as determined by the Administrator, that small business 

7 refiners may purchase at the average auction price and 

8 may use to demonstrate compliance pursuant to section 

9 722. These regulations shall provide the following: 

10 ‘‘(1) ALLOWED PURCHASES.—From January 1 

11 of the calendar year that matches the vintage year 

12 for which allowances have been placed in the reserve, 

13 through January 14 of the following year, small 

14 business refiners (as defined in section 775(b)) may 

15 purchase allowances from this reserve at the price 

16 determined pursuant to paragraph (2). 

17 ‘‘(2) PRICE.—The price for allowances pur18 chased from this reserve shall be the average auction 

19 price for allowances of the same vintage year pur20 chased at auctions conducted pursuant to this sec21 tion during the 12 months preceding the purchase of 

22 the allowances. 

23 ‘‘(3) USE OF ALLOWANCES.—Allowances pur24 chased from this reserve shall only be used by the 

25 purchaser to demonstrate compliance pursuant to 


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1 section 722 for attributable greenhouse gas emis2 sions in the calendar year that matches the vintage 

3 year of the purchased allowance. Allowances pur4 chased from this reserve may not be banked, traded 

5 or borrowed. 

6 ‘‘(4) LIMITATIONS ON PURCHASE AMOUNT.— 

7 The Administrator, by regulation adopted after pub8 lic notice and an opportunity for comment, shall es9 tablish procedures to distribute the ability to pur10 chase allowances from the reserve fairly among all 

11 small business refiners interested in purchasing al12 lowances from this reserve so as to address the po13 tential that requests to purchase allowances exceed 

14 the number of allowances available in the reserve. 

15 This regulation may place limits on the number of 

16 allowances a small business refiner may purchase 

17 from the reserve. 

18 ‘‘(5) UNSOLD ALLOWANCES.—Vintage year al19 lowances not sold from the reserve on or before Jan20 uary 15 of the calendar year following the vintage 

21 year shall be sold at an auction conducted pursuant 

22 to this section no later than March 31 of the cal23 endar year following the vintage year. If significantly 

24 more allowances are being placed in the reserve than 

25 are being purchased from the reserve several years 


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1 in a row, the Administrator may adjust either the 

2 percent of allowances placed in the reserve or the 

3 date by which allowances may be purchased from the 

4 reserve. 

5 ‘‘SEC. 779. AUCTIONING ALLOWANCES FOR OTHER ENTI6 TIES. 

7 ‘‘(a) CONSIGNMENT.—Any entity holding emission al8 lowances or compensatory allowances may request that the 

9 Administrator auction, pursuant to section 778, the allow10 ances on consignment. 

11 ‘‘(b) PRICING.—When the Administrator acts under 

12 this section as the agent of an entity in possession of emis13 sion allowances, the Administrator is not obligated to ob14 tain the highest price possible for the emission allowances, 

15 and instead shall auction consignment allowances in the 

16 same manner and pursuant to the same rules as auctions 

17 of other allowances under section 778. The Administrator 

18 may permit the entity offering the allowance for sale to 

19 condition the sale of its allowances pursuant to this section 

20 on a minimum reserve price that is different than the re21 serve auction price set pursuant to section 778(d). 

22 ‘‘(c) PROCEEDS.—For emission allowances and com23 pensatory allowances auctioned pursuant to this section, 

24 notwithstanding section 3302 of title 31, United States 

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1 ceipt, the United States shall transfer the proceeds from 

2 the auction to the entity which held the allowances auc3 tioned. No funds transferred from a purchaser to a seller 

4 of emission allowances or compensatory allowances under 

5 this subsection shall be held by any officer or employee 

6 of the United States or treated for any purpose as public 

7 monies. 

8 ‘‘(d) REGULATIONS.—The Administrator shall issue 

9 regulations within 24 months after the date of enactment 

10 of this title to implement this section. 

11 ‘‘SEC. 780. COMMERCIAL DEPLOYMENT OF CARBON CAP12 TURE AND SEQUESTRATION TECHNOLOGIES. 

13 ‘‘(a) DEFINITIONS.—In this section: 

14 ‘‘(1) CARBON CAPTURE AND STORAGE.—The 

15 term ‘carbon capture and sequestration’ shall— 

16 ‘‘(A) have such term as Administrator 

17 shall determine by regulation; and 

18 ‘‘(B) include— 

19 ‘‘(i) geological sequestration; and 

20 ‘‘(ii) conversion of captured carbon di21 oxide to a stable form that will safely and 

22 permanently sequester the carbon dioxide. 

23 ‘‘(2) QUALIFYING ELECTRIC GENERATING

24 UNIT.—The term ‘qualifying electric generating unit’ 

25 means an electric utility unit that— 


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1 ‘‘(A) derives at least 50 percent of the an2 nual fuel input of the unit from— 

3 ‘‘(i) coal or waste coal; 

4 ‘‘(ii) petroleum coke; or 

5 ‘‘(iii) any combination of those 2 

6 fuels; and 

7 ‘‘(B)(i) has a nameplate capacity of 200 

8 megawatts or more; or 

9 ‘‘(ii) in the case of retrofit applications, the 

10 carbon capture and sequestration technology is 

11 applied to the flue gas or fuel gas stream from 

12 at least 200 megawatts of the total nameplate 

13 generating capacity of the unit. 

14 ‘‘(3) QUALIFYING INDUSTRIAL SOURCE.—The 

15 term ‘qualifying industrial source’ means a source 

16 that— 

17 ‘‘(A) is not a qualifying electric generating 

18 unit; 

19 ‘‘(B) absent carbon capture and sequestra20 tion, would emit greater than 50,000 tons per 

21 year of carbon dioxide; and 

22 ‘‘(C) does not produce a liquid transpor23 tation fuel from a solid fossil-based feedstock. 

24 ‘‘(4) TREATED GENERATING CAPACITY.— 


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1 ‘‘(A) IN GENERAL.—The term ‘treated 

2 generating capacity’ means the portion of the 

3 total generating capacity of an electric gener4 ating unit (or industrial source, measured by 

5 such method as the Administrator may des6 ignate to be equivalent to the calculation under 

7 subparagraph (B)) for which the flue gas or 

8 fuel gas is treated by the carbon capture and 

9 sequestration technology. 

10 ‘‘(B) CALCULATION.—In determining the 

11 treated portion of flue gas or fuel gas of an 

12 electric generating unit under subparagraph 

13 (A), the Administrator shall multiply the name14 plate capacity of the unit by the ratio that— 

15 ‘‘(i) the mass of flue gas or fuel gas 

16 that is treated by the carbon capture and 

17 sequestration technology; bears to 

18 ‘‘(ii) the total mass of the flue gas or 

19 fuel gas that is produced when the unit is 

20 operating at maximum capacity. 

21 ‘‘(b) REGULATIONS.—Not later than 2 years after 

22 the date of enactment of this title, the Administrator shall 

23 promulgate regulations providing for the distribution of 

24 emission allowances allocated under section 771(a)(6), 

25 pursuant to the requirements of this section, to support 


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1 the commercial deployment of carbon capture and seques2 tration technologies in electric power generation and in3 dustrial operations. 

4 ‘‘(c) ELIGIBILITY CRITERIA AND METHOD OF DIS5 TRIBUTION.— 

6 ‘‘(1) ELIGIBILITY.—For an owner or operator 

7 of a project to be eligible to receive emission allow8 ances under this section, the project shall— 

9 ‘‘(A) implement carbon capture and se10 questration technology— 

11 ‘‘(i) at a qualifying electric generating 

12 unit that, upon implementation of the car13 bon capture and sequestration technology, 

14 will achieve an emission limitation that is 

15 at least a 50-percent reduction in emis16 sions of the carbon dioxide produced by— 

17 ‘‘(I) the unit, measured on an 

18 annual basis, as determined by the 

19 Administrator; or 

20 ‘‘(II) in the case of retrofit appli21 cations described in subsection 

22 (a)(2)(B)(ii), the treated portion of 

23 flue gas from the unit, measured on 

24 an annual basis, as determined by the 

25 Administrator; or 


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1 ‘‘(ii) at a qualifying industrial source 

2 that, upon implementation, will achieve an 

3 emission limitation that is at least a 50- 

4 percent reduction in emissions of the car5 bon dioxide produced by the emission 

6 point, measured on an annual basis, as de7 termined by the Administrator; 

8 ‘‘(B)(i) geologically sequester carbon diox9 ide at a site that meets all applicable permitting 

10 and certification requirements for geological se11 questration; or 

12 ‘‘(ii) pursuant to such requirements as the 

13 Administrator may prescribe by regulation, con14 vert captured carbon dioxide to a stable form 

15 that will safely and permanently sequester the 

16 carbon dioxide; 

17 ‘‘(C) meet all other applicable State, tribal, 

18 and Federal permitting requirements; and 

19 ‘‘(D) be located in the United States. 

20 ‘‘(2) METHOD OF DISTRIBUTION.— 

21 ‘‘(A) PERIOD.—The Administrator shall 

22 distribute emission allowances allocated under 

23 section 771(a)(6) to eligible projects for each of 

24 the first 10 calendar years for which each eligi25 ble project is in commercial operation. 


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1 ‘‘(B) BONUS ALLOWANCE FORMULA FOR

2 ELECTRIC GENERATING UNITS.— 

3 ‘‘(i) PHASE I DISTRIBUTION.—For 

4 each project that is certified under sub5 section (h), the quantity of emission allow6 ances that the Administrator shall dis7 tribute for a calendar year to the owner or 

8 operator of the eligible project shall be 

9 equal to the quotient obtained by divid10 ing— 

11 ‘‘(I) the product obtained by mul12 tiplying— 

13 ‘‘(aa) the number of metric 

14 tons of carbon dioxide emissions 

15 avoided through capture and se16 questration of emissions by the 

17 project for a particular year, as 

18 determined pursuant to such 

19 methodology as the Adminis20 trator shall prescribe by regula21 tion; and 

22 ‘‘(bb) a bonus allowance 

23 value that is assigned to the 

24 project under subsection (d)(2); 

25 by 


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1 ‘‘(II) the average fair market 

2 value of an emission allowance during 

3 the calendar year preceding the year 

4 during which the project captured and 

5 sequestered the carbon dioxide emis6 sions. 

7 ‘‘(ii) PHASE II DISTRIBUTION.—For 

8 each project that qualifies under subsection 

9 (e), the quantity of emission allowances 

10 that the Administrator shall distribute for 

11 a calendar year to the owner or operator of 

12 the eligible project shall be determined 

13 through— 

14 ‘‘(I) reverse auction, as pre15 scribed by regulation under subsection 

16 (e)(3); or 

17 ‘‘(II) if the Administrator decides 

18 not to distribute allowances through a 

19 reverse auction, an alternate distribu20 tion method established by regulation 

21 under subsection (e)(4). 

22 ‘‘(C) FORMULA FOR INDUSTRIAL

23 SOURCES.—For each project that qualifies 

24 under subsection (g), the quantity of emission 

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1 tribute for a calendar year to the owner or op2 erator of the eligible project shall be determined 

3 in accordance with subsection (g)(2). 

4 ‘‘(D) CONSISTENCY.—The Administrator 

5 shall develop a method of distribution for each 

6 category of eligible projects under this para7 graph in a manner that is consistent with the 

8 certification and distribution requirements 

9 under subsection (h). 

10 ‘‘(d) PHASE I DISTRIBUTION TO ELECTRIC GENER11 ATING UNITS.— 

12 ‘‘(1) APPLICABILITY.— 

13 ‘‘(A) IN GENERAL.—Subject to subpara14 graph (B), this subsection shall apply to 

15 projects that are undertaken at qualifying elec16 tric generating units that the Administrator de17 termines to be eligible to receive emission allow18 ances under this section. 

19 ‘‘(B) CAPACITY.—The total cumulative 

20 generating capacity of the projects described in 

21 subparagraph (A) shall be equal to approxi22 mately 20 gigawatts of the treated generating 

23 capacity. 

24 ‘‘(2) BONUS ALLOWANCE VALUES.— 

25 ‘‘(A) FIRST TRANCHE.— 


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1 ‘‘(i) IN GENERAL.—The first tranche 

2 shall include the first 10 gigawatts of 

3 treated generating capacity undertaken at 

4 qualifying electric generating units that re5 ceive emission allowances under this sec6 tion. 

7 ‘‘(ii) CERTAIN UNITS.—For an eligible 

8 project achieving capture and sequestration 

9 of 90 percent or more of the carbon diox10 ide that otherwise would be emitted by the 

11 unit, the bonus allowance value shall be 

12 $96 per ton of carbon dioxide emissions 

13 avoided through the use of capture and se14 questration. 

15 ‘‘(iii) BONUS ALLOWANCE VALUE.— 

16 The Administrator shall establish, by regu17 lation, a bonus allowance value for each 

18 rate of capture and sequestration achieved 

19 by an eligible project— 

20 ‘‘(I) beginning at a minimum of 

21 $50 per ton for a 50-percent rate; and 

22 ‘‘(II) varying in direct proportion 

23 with increasing rates of capture and 

24 sequestration up to $96 per ton for an 

25 90-percent rate. 


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1 ‘‘(B) SECOND TRANCHE.— 

2 ‘‘(i) IN GENERAL.—The second 

3 tranche shall include the second 10 

4 gigawatts of treated generating capacity 

5 undertaken at qualifying electric gener6 ating units that receive emission allow7 ances under this section. 

8 ‘‘(ii) CERTAIN UNITS.—For an eligible 

9 project achieving the capture and seques10 tration of 90 percent or more of the carbon 

11 dioxide that otherwise would be emitted by 

12 the eligible project, the bonus allowance 

13 value shall be $85 per ton of carbon diox14 ide emissions avoided through the use of 

15 capture and sequestration. 

16 ‘‘(iii) BONUS ALLOWANCE VALUE.— 

17 The Administrator shall establish, by regu18 lation, a bonus allowance value for each 

19 rate of capture and sequestration achieved 

20 by an eligible project— 

21 ‘‘(I) beginning at a minimum of 

22 $50 per ton for a 50-percent rate; and 

23 ‘‘(II) varying in direct proportion 

24 with increasing rates of capture and 


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1 sequestration up to $85 per ton for a 

2 90-percent rate. 

3 ‘‘(C) INCREASE IN BONUS ALLOWANCE

4 VALUE.—For an eligible project that com5 mences commercial operation by not later than 

6 January 1, 2017, and that meets the eligibility 

7 criteria under subsection (c), the otherwise-ap8 plicable bonus allowance value under this para9 graph shall be increased by $10, if the owner 

10 or operator of the eligible project submits to the 

11 Administrator by not later than January 1, 

12 2012, a notification of the intent to implement 

13 carbon capture and sequestration technology at 

14 a qualifying electric generating unit in accord15 ance with subsection (c). 

16 ‘‘(D) REDUCTION.— 

17 ‘‘(i) IN GENERAL.—For a carbon cap18 ture and sequestration project sequestering 

19 in a geological formation for purposes of 

20 enhanced hydrocarbon recovery, the Ad21 ministrator, by regulation, shall reduce the 

22 applicable bonus allowance value under 

23 this paragraph to reflect the lower net cost 

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1 tion into geological formations solely for 

2 purposes of sequestration. 

3 ‘‘(ii) ASSESSMENT OF NET COST.— 

4 For the purpose of this subparagraph, an 

5 assessment of net cost of a project shall 

6 account for the cost of the injection of car7 bon dioxide, or other method of enhanced 

8 hydrocarbon recovery, that would have oth9 erwise been undertaken in the absence of 

10 the carbon capture and sequestration 

11 project under consideration. 

12 ‘‘(E) ADJUSTMENTS.—The Administrator 

13 shall annually adjust for monetary inflation the 

14 bonus allowance values established under this 

15 paragraph. 

16 ‘‘(F) MEASUREMENT.—The Administrator 

17 shall measure the tranches and capture levels 

18 for assigning the bonus allowance values under 

19 this subsection based on the treated generating 

20 capacity of the qualifying electric generating 

21 units and qualifying industrial sources that re22 ceive emission allowances under this subsection. 

23 ‘‘(G) AVERAGE FAIR MARKET VALUE.— 

24 ‘‘(i) IN GENERAL.—The Administrator 

25 and the Secretary of Energy may jointly 


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1 determine that the average fair market 

2 value for emission allowances or the bonus 

3 allowances have been too low or too high to 

4 achieve efficient and cost-effective commer5 cial deployment of carbon capture and se6 questration technology in a given calendar 

7 year. 

8 ‘‘(ii) ACTION ON DETERMINATION.— 

9 On making a determination under clause 

10 (i), the Administrator may— 

11 ‘‘(I) promulgate regulations to 

12 adjust the bonus allowance value 

13 under this paragraph; or 

14 ‘‘(II) distribute an appropriate 

15 quantity of emission allowances allo16 cated under section 771(a)(6) from 

17 any future vintage year. 

18 ‘‘(e) PHASE II DISTRIBUTION TO ELECTRIC GENER19 ATING UNITS.— 

20 ‘‘(1) APPLICATION.—This subsection shall 

21 apply only to the distribution of emission allowances 

22 for carbon capture and sequestration projects under23 taken at qualifying electric generating units and 

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1 ating capacity threshold identified under subsection 

2 (d)(1) is reached. 

3 ‘‘(2) REGULATIONS.—Not later than 2 years 

4 before the date on which the capacity threshold iden5 tified in subsection (d)(1) is projected to be reached, 

6 the Administrator shall promulgate regulations to 

7 govern the distribution of emission allowances to the 

8 owners or operators of eligible projects under this 

9 subsection. 

10 ‘‘(3) REVERSE AUCTIONS.— 

11 ‘‘(A) IN GENERAL.—Except as provided in 

12 paragraph (4), the regulations promulgated 

13 pursuant to paragraph (2) shall provide for the 

14 distribution of emission allowances to the own15 ers or operators of eligible projects under this 

16 subsection through at least 2 reverse auctions, 

17 each of which shall be held not less frequently 

18 than once each calendar year. 

19 ‘‘(B) REQUIREMENTS.— 

20 ‘‘(i) PROJECTS AT INDUSTRIAL

21 SOURCES.—The Administrator shall annu22 ally establish a reverse auction for projects 

23 at industrial sources, which may not par24 ticipate in other auctions. 


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1 ‘‘(ii) OTHER AUCTIONS.—The Admin2 istrator may establish a separate auction 

3 for each of not more than 5 different 

4 project categories, as defined based on— 

5 ‘‘(I) coal type; 

6 ‘‘(II) capture technology; 

7 ‘‘(III) geological formation type; 

8 ‘‘(IV) new unit versus retrofit ap9 plication; 

10 ‘‘(V) such other factors as the 

11 Administrator may prescribe; or 

12 ‘‘(VI) any combination of the fac13 tors described in subclauses (I) 

14 through (V). 

15 ‘‘(iii) EFFICIENT DISTRIBUTION.— 

16 The Administrator shall establish proce17 dures for the auction of emission allow18 ances under this subparagraph to ensure 

19 that the establishment of separate auctions 

20 for different project categories will not un21 duly impede the efficient and expeditious 

22 distribution of emission allowances to eligi23 ble projects under this subsection. 

24 ‘‘(iv) MINIMUM RATES.—The Admin25 istrator may establish appropriate minVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00660 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 imum rates of capture and sequestration 

2 for the treated generating capacity of a 

3 project in implementing this subparagraph. 

4 ‘‘(C) AUCTION PROCESS.—At each reverse 

5 auction under this paragraph— 

6 ‘‘(i) the Administrator shall solicit 

7 bids from eligible projects; 

8 ‘‘(ii) owners or operators of eligible 

9 projects participating in the auction shall 

10 submit a bid, including the desired level of 

11 carbon dioxide sequestration incentive per 

12 ton and the estimated quantity of carbon 

13 dioxide that the project will permanently 

14 sequester during a 10-year period; and 

15 ‘‘(iii) the Administrator shall select 

16 bids within each auction for the sequestra17 tion quantity submitted, beginning with 

18 the eligible project for which the bid is 

19 submitted for the lowest level of sequestra20 tion incentive on a per-ton basis and meet21 ing such other requirements as the Admin22 istrator may specify, until the amounts 

23 available for the reverse auction are com24 mitted. 


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1 ‘‘(D) FORM OF DISTRIBUTION.—The Ad2 ministrator shall distribute emission allowances 

3 to the owners or operators of eligible projects 

4 selected through a reverse auction under this 

5 paragraph pursuant to a formula equivalent to 

6 the formula contained in subsection (c)(2)(B), 

7 except that the bonus allowance value that is 

8 bid by the applicable entity shall be substituted 

9 for the bonus allowance values described in sub10 section (c)(2). 

11 ‘‘(4) ALTERNATIVE DISTRIBUTION METHOD.— 

12 ‘‘(A) IN GENERAL.—If the Administrator 

13 determines that a reverse auction will not result 

14 in efficient and cost-effective commercial de15 ployment of carbon capture and sequestration 

16 technologies, the Administrator, pursuant to 

17 regulations under paragraph (2) or (5), shall 

18 prescribe a schedule for the provision of bonus 

19 allowances to the owners or operators of eligible 

20 projects under this subsection, in accordance 

21 with the requirements of this paragraph. 

22 ‘‘(B) MULTIPLE TRANCHES.—The Admin23 istrator shall divide emission allowances avail24 able for distribution to the owners or operators 


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1 of eligible projects into a series of tranches, 

2 each of which— 

3 ‘‘(i) shall support the deployment of a 

4 specified quantity of cumulative electric 

5 generating capacity using carbon capture 

6 and sequestration technology; and 

7 ‘‘(ii) shall not be greater than 10 

8 gigawatts of treated generating capacity. 

9 ‘‘(C) METHOD OF DISTRIBUTION.—The 

10 Administrator shall distribute emission allow11 ances within each tranche, on a first-come, 

12 first-served basis— 

13 ‘‘(i) based on the date of full-scale op14 eration of capture and sequestration tech15 nology; and 

16 ‘‘(ii) pursuant to a formula that— 

17 ‘‘(I) is similar to the formula 

18 contained in subsection (c)(2)(C), ex19 cept that the Administrator may pre20 scribe bonus allowance values dif21 ferent than those described in sub22 section (c)(2) based on the criteria es23 tablished under subparagraph (E); 

24 and 


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1 ‘‘(II) establishes the number of 

2 emission allowances to be distributed 

3 per ton of carbon dioxide sequestered 

4 by the project. 

5 ‘‘(D) REQUIREMENTS.—For each tranche 

6 established pursuant to subparagraph (B), the 

7 Administrator shall establish a schedule for dis8 tributing emission allowances that— 

9 ‘‘(i) is based on a sliding scale that 

10 provides higher bonus allowance values for 

11 projects achieving higher rates of capture 

12 and sequestration for the treated genera13 tion capacity at the unit; 

14 ‘‘(ii) for each capture and sequestra15 tion rate, establishes a bonus allowance 

16 value that is lower than that established 

17 for the applicable rate for the previous 

18 tranche (or, in the case of the first 

19 tranche, than that established for the ap20 plicable rate under subsection (d)(2)); and 

21 ‘‘(iii) may establish different bonus al22 lowance levels for not more than 5 dif23 ferent project categories, as defined based 

24 on— 

25 ‘‘(I) coal type; 


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1 ‘‘(II) capture and transportation 

2 technology; 

3 ‘‘(III) geological formation type; 

4 ‘‘(IV) new unit versus retrofit ap5 plication; 

6 ‘‘(V) such other factors as the 

7 Administrator may prescribe; or 

8 ‘‘(VI) any combination of the fac9 tors described in subclauses (I) 

10 through (V). 

11 ‘‘(E) CRITERIA FOR ESTABLISHING BONUS

12 ALLOWANCE VALUES.—In establishing bonus al13 lowance values under this paragraph, the Ad14 ministrator shall seek to cover not more than 

15 the reasonable incremental capital and oper16 ating costs of a project that are attributable to 

17 implementation of carbon capture, transpor18 tation, and sequestration technologies, taking 

19 into account— 

20 ‘‘(i) the reduced cost of compliance 

21 with section 722; 

22 ‘‘(ii) the reduced cost associated with 

23 sequestering in a geological formation for 

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1 logical formations solely for purposes of se2 questration; 

3 ‘‘(iii) the relevant factors defining the 

4 project category; and 

5 ‘‘(iv) such other factors as the Admin6 istrator determines to be appropriate. 

7 ‘‘(5) REVISION OF REGULATIONS.—The Admin8 istrator shall review and, as appropriate, revise the 

9 applicable regulations under this subsection not less 

10 frequently than once every 8 years. 

11 ‘‘(f) LIMITS FOR CERTAIN ELECTRIC GENERATING

12 UNITS.— 

13 ‘‘(1) DEFINITIONS.—In this subsection, the 

14 terms ‘covered EGU’ and ‘initially permitted’ have 

15 the meanings given those terms in section 812. 

16 ‘‘(2) COVERED EGUS INITIALLY PERMITTED

17 FROM 2009 THROUGH 2014.—For a covered EGU 

18 that is initially permitted during the period begin19 ning on January 1, 2009, and ending on December 

20 31, 2014, the Administrator shall reduce the quan21 tity of emission allowances that the owner or oper22 ator of the covered EGU would otherwise be eligible 

23 to receive under this section as follows: 

24 ‘‘(A) In the case of a covered EGU com25 mencing operation on or before January 1, 


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1 2019, if the date in clause (ii)(I) is earlier than 

2 the date in clause (ii)(II), by the product ob3 tained by multiplying— 

4 ‘‘(i) 20 percent; and 

5 ‘‘(ii) the number of years, if any, that 

6 have elapsed between— 

7 ‘‘(I) the earlier of— 

8 ‘‘(aa) January 1, 2020; and 

9 ‘‘(bb) the date that is 5 

10 years after the commencement of 

11 operation of the covered EGU; 

12 and 

13 ‘‘(II) the first year that the cov14 ered EGU achieves (and thereafter 

15 maintains) an emission limitation that 

16 is at least a 50-percent reduction in 

17 emissions of carbon dioxide produced 

18 by the unit, measured on an annual 

19 basis, as determined in accordance 

20 with section 812(b)(2). 

21 ‘‘(B) In the case of a covered EGU com22 mencing operation after January 1, 2019, by 

23 the product obtained by multiplying— 

24 ‘‘(i) 20 percent; and 


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1 ‘‘(ii) the number of years, if any, that 

2 have elapsed between— 

3 ‘‘(I) the commencement of oper4 ation of the covered EGU; and 

5 ‘‘(II) the first year that the cov6 ered EGU achieves (and thereafter 

7 maintains) an emission limitation that 

8 is at least a 50-percent reduction in 

9 emissions of carbon dioxide produced 

10 by the unit, measured on an annual 

11 basis, as determined in accordance 

12 with section 812(b)(2). 

13 ‘‘(3) COVERED EGUS INITIALLY PERMITTED

14 FROM 2015 THROUGH 2019.—The owner or operator 

15 of a covered EGU that is initially permitted during 

16 the period beginning on January 1, 2015, and end17 ing on December 31, 2019, shall be ineligible to re18 ceive emission allowances under this section if the 

19 covered EGU, on commencement of operations (and 

20 thereafter), does not achieve and maintain an emis21 sion limitation that is at least a 50-percent reduction 

22 in emissions of carbon dioxide produced by the cov23 ered EGU, measured on an annual basis, as deter24 mined in accordance with section 812(b)(2). 

25 ‘‘(g) INDUSTRIAL SOURCES.— 


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1 ‘‘(1) EMISSION ALLOWANCES.—The Adminis2 trator— 

3 ‘‘(A) may distribute not more than 15 per4 cent of the emission allowances allocated under 

5 section 771(a)(6) for any vintage year to the 

6 owners or operators of eligible industrial 

7 sources to support the commercial-scale deploy8 ment of carbon capture and sequestration tech9 nologies at those sources; and 

10 ‘‘(B) notwithstanding any other provision 

11 of law— 

12 ‘‘(i) may distribute to eligible indus13 trial sources not more than 15 percent of 

14 the emission allowances allocated under 

15 section 771(a)(6) for any vintage year in 

16 the second tranche of phase I; but 

17 ‘‘(ii) may not distribute those allow18 ances for any vintage year in the first 

19 tranche of phase I. 

20 ‘‘(2) DISTRIBUTION.— 

21 ‘‘(A) IN GENERAL.—The Administrator 

22 shall prescribe, by regulation, requirements for 

23 the distribution of emission allowances to the 

24 owners or operators of industrial sources under 

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1 mula that awards emission allowances to quali2 fying projects on the basis of tons of carbon di3 oxide captured and permanently sequestered. 

4 ‘‘(B) METHOD.—The Administrator may 

5 provide for the distribution of emission allow6 ances pursuant to— 

7 ‘‘(i) a reverse auction method similar 

8 to the method described in subsection 

9 (e)(3), including the use of separate auc10 tions for different project categories; or 

11 ‘‘(ii) an incentive schedule similar to 

12 the schedule described in subsection (e)(4), 

13 which shall ensure that incentives are es14 tablished so as to satisfy the requirement 

15 described in subsection (e)(4)(E). 

16 ‘‘(3) REVISION OF REGULATIONS.—The Admin17 istrator shall review and, as appropriate, revise the 

18 regulations under this subsection not less frequently 

19 than once every 8 years. 

20 ‘‘(h) CERTIFICATION AND DISTRIBUTION.— 

21 ‘‘(1) CERTIFICATION.— 

22 ‘‘(A) REQUEST.— 

23 ‘‘(i) PHASE I; ALTERNATIVE DIS24 TRIBUTION METHOD.—In the case of a 

25 qualifying project that is eligible to receive 


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1 allowances under phase I or under sub2 section (e)(4), the owner or operator of the 

3 planned project may request from the Ad4 ministrator a certification that the project 

5 is eligible to receive emission allowances 

6 under this section. 

7 ‘‘(ii) REVERSE AUCTIONS.—In the 

8 case of a qualifying project that wins a re9 verse auction under subsection (e) or (g), 

10 within a reasonably brief period following 

11 completion of the auction (as specified by 

12 the Administrator), the owner or operator 

13 of the qualifying project shall request from 

14 the Administrator a certification that the 

15 project is eligible to receive emission allow16 ances under this section. 

17 ‘‘(iii) ELIGIBLE PROJECTS.—Eligible 

18 projects in phase I and phase II may re19 ceive certification under this paragraph. 

20 ‘‘(iv) ISSUANCE.—The Administrator 

21 shall issue a certification described in this 

22 subparagraph if the owner or operator 

23 demonstrates a commitment to construct 

24 and operate a project that satisfies— 


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1 ‘‘(I) the eligibility criteria of sub2 section (c); and 

3 ‘‘(II) the requirements of this 

4 subsection. 

5 ‘‘(B) DOCUMENTATION.—The Adminis6 trator shall prescribe, by regulation, the docu7 mentation necessary for making a determina8 tion of project eligibility for the certification 

9 under subparagraph (A), including— 

10 ‘‘(i) technical information regarding 

11 the capture and sequestration technology, 

12 coal type, geological formation type (if ap13 plicable), and other relevant design fea14 tures of the project; 

15 ‘‘(ii) the annual reductions in carbon 

16 dioxide emissions that the capture and se17 questration technology is projected to 

18 achieve during each of the first 10 years of 

19 the project’s commercial operation; and 

20 ‘‘(iii) a demonstration that the owner 

21 or operator is committed to both con22 structing and operating the planned 

23 project on a timeline marked by reasonable 

24 capture and sequestration milestones, 


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1 through the completion of 1 of the actions 

2 specified in subparagraph (C)(iii). 

3 ‘‘(C) COMMITMENT.— 

4 ‘‘(i) IN GENERAL.—Subject to clause 

5 (ii), the completion of any 1 of the quali6 fying actions specified under clause (iii) 

7 shall constitute a commitment to construct 

8 and operate a planned carbon capture and 

9 sequestration project. 

10 ‘‘(ii) CONDITION.—In the case of a 

11 qualifying action specified in subclause (I) 

12 or (II) of clause (iii), the completion of 

13 such an action may be subject to a condi14 tion that the Administrator will issue a 

15 certification under this paragraph for the 

16 distribution of emission allowances to the 

17 project. 

18 ‘‘(iii) QUALIFYING ACTIONS.—Quali19 fying actions under this subparagraph 

20 shall include— 

21 ‘‘(I) the execution of— 

22 ‘‘(aa) a commitment by 

23 lenders or other appropriate enti24 ties to finance the project, which 

25 may be subject to customary 


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1 closing conditions that are associ2 ated with the execution of the 

3 commitment; and 

4 ‘‘(bb) a commitment by the 

5 owner or operator of the project 

6 to execute a surety bond in suffi7 cient amounts by not later than 2 

8 years after the date on which the 

9 Administrator issues the certifi10 cation for the project; or 

11 ‘‘(II) an authorization by a State 

12 regulatory authority to allow recovery, 

13 from the retail customers of such elec14 tric utility, of the costs of the project 

15 by a State-regulated electric utility 

16 that plans to construct the project. 

17 ‘‘(D) FAILURE TO REQUEST CERTIFI18 CATION.— 

19 ‘‘(i) IN GENERAL.—An owner or oper20 ator may elect not to request a certifi21 cation on the eligibility of a planned 

22 project under subparagraph (A) prior to 

23 the commercial operation of the project. 

24 ‘‘(ii) DETERMINATION BY ADMINIS25 TRATOR.—If an owner or operator elects 


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1 not to request a certification under clause 

2 (i), the Administrator shall make a deter3 mination regarding whether the project 

4 satisfies the eligibility requirements of sub5 section (c) at the time that the Adminis6 trator makes a determination regarding 

7 the annual distribution of emission allow8 ances under paragraph (3)(A). 

9 ‘‘(2) RESERVATION OF EMISSION ALLOW10 ANCES.— 

11 ‘‘(A) AMOUNT.— 

12 ‘‘(i) IN GENERAL.—For each project 

13 that receives a certification of eligibility 

14 under paragraph (1), the Administrator 

15 shall reserve on a first-come, first-served 

16 basis a portion of the emission allowances 

17 that are allocated for the deployment of 

18 carbon capture and sequestration tech19 nology under section 771(a)(6). 

20 ‘‘(ii) DETERMINATION.—The reserva21 tion of emission allowances for a particular 

22 eligible project under this paragraph shall 

23 be equal to the number of emission allow24 ances that the project is entitled to receive 

25 under the applicable distribution method 


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1 under this section upon commercial oper2 ation of the carbon capture and sequestra3 tion technology, as determined by the Ad4 ministrator based on— 

5 ‘‘(I) the applicable bonus allow6 ance value; 

7 ‘‘(II) the number of tons of car8 bon dioxide emissions projected to be 

9 captured and sequestered each cal10 endar year under paragraph 

11 (1)(B)(i)(II); and 

12 ‘‘(III) a discount rate to account 

13 for the monetary inflation that may 

14 be expected to occur during each of 

15 the relevant 10 calendar years, as de16 termined by the Administrator. 

17 ‘‘(B) TERMINATION OF RESERVATION.— 

18 ‘‘(i) IN GENERAL.—A reservation of 

19 emission allowances for a particular project 

20 under subparagraph (A) shall terminate if 

21 the owner or operator fails to achieve rea22 sonable milestones for commencing con23 struction or commercial operation of the 

24 project, as specified under paragraph 

25 (1)(B)(i)(III). 


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1 ‘‘(ii) REDUCED QUANTITY OF CARBON

2 DIOXIDE CAPTURED AND SEQUESTERED.— 

3 If the quantity of carbon dioxide captured 

4 and sequestered by a project on average 

5 over 3 consecutive vintage years is less 

6 than the quantity estimated for those vin7 tage years under subparagraph (A), the 

8 reservation of emission allowances for the 

9 project under subparagraph (A) shall be 

10 reduced in future years by the difference 

11 between— 

12 ‘‘(I) the quantity of carbon diox13 ide captured and sequestered on aver14 age over the applicable 3 consecutive 

15 years; and 

16 ‘‘(II) the quantity estimated 

17 under subparagraph (A) for the appli18 cable years. 

19 ‘‘(iii) AVAILABILITY.—The Adminis20 trator shall immediately make available to 

21 other eligible projects emission allowances 

22 for which the Administrator has termi23 nated an emission allowance reservation 

24 for a particular project under this subpara25 graph. 


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1 ‘‘(3) DISTRIBUTION PROCESS.— 

2 ‘‘(A) ANNUAL DISTRIBUTION.—The Ad3 ministrator shall distribute the emission allow4 ances to eligible projects on an annual basis. 

5 ‘‘(B) BASIS.—The annual distribution of 

6 emission allowances shall be based on the total 

7 tons of carbon dioxide that the project annually 

8 captures and sequesters during each of the first 

9 10 years of commercial operation, in accordance 

10 with subsection (c)(2). 

11 ‘‘(C) TOTAL DISTRIBUTION AMOUNT.—The 

12 total amount of emission allowances distributed 

13 to an eligible project for each of the first 10 

14 years of commercial operation may be greater 

15 than, or less than, the quantity of emissions al16 lowances that the Administrator has reserved 

17 for the eligible project under paragraph (2). 

18 ‘‘(D) REPORTS.— 

19 ‘‘(i) IN GENERAL.—Except as pro20 vided in subparagraph (B), the Adminis21 trator shall make each annual distribution 

22 of emission allowances by not later than 90 

23 days after the date on which the owner or 

24 operator of a project submits to the Ad25 ministrator a report regarding the carbon 


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1 dioxide emissions captured and sequestered 

2 for a particular year by the project. 

3 ‘‘(ii) REQUIREMENT.—A report under 

4 subclause (I) shall be verified in accord5 ance with regulations to be promulgated by 

6 the Administrator. 

7 ‘‘(i) LIMITATIONS.— 

8 ‘‘(1) IN GENERAL.—Emission allowances shall 

9 be distributed under this section only for tons of car10 bon dioxide emissions that have already been cap11 tured and sequestered. 

12 ‘‘(2) PERIOD.—A qualifying project may receive 

13 annual emission allowances under this section only 

14 for the first 10 years of operation. 

15 ‘‘(3) CAPACITY.— 

16 ‘‘(A) IN GENERAL.—Approximately 72 

17 gigawatts of total cumulative treated generating 

18 capacity may receive emission allowances under 

19 this section. 

20 ‘‘(B) ALLOWANCE SURPLUS.—On reaching 

21 the cumulative capacity described in subpara22 graph (A), any emission allowances that are al23 located for carbon capture and sequestration 

24 deployment under section 771(a)(6) and are not 

25 yet obligated under this section shall be treated 


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1 as emission allowances not designated for dis2 tribution for purposes of section 771(b)(2). 

3 ‘‘(j) EXHAUSTION OF ACCOUNT AND ANNUAL ROLL4 OVER OF SURPLUS EMISSION ALLOWANCES.— 

5 ‘‘(1) IN GENERAL.—In distributing emission al6 lowances under this section, the Administrator shall 

7 ensure that eligible projects receive distributions of 

8 emission allowances for the first 10 years of com9 mercial operation. 

10 ‘‘(2) DIFFERENT VINTAGE YEARS.— 

11 ‘‘(A) DETERMINATION.—If the Adminis12 trator determines that the emission allowances 

13 allocated under section 771(a)(6) with a vintage 

14 year that matches the year of distribution will 

15 be exhausted once the estimated full 10-year 

16 distributions will be provided to current eligible 

17 participants, the Administrator shall provide to 

18 new eligible projects emission allowances from 

19 vintage years after the year of the distribution. 

20 ‘‘(B) DIVERSITY FACTORS.—If the Admin21 istrator provides allowances to new eligible 

22 projects under subparagraph (A), the Adminis23 trator shall promulgate regulations to prioritize 

24 new eligible projects that are distinguished from 

25 prior recipients of allowances by 1 or more of 


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1 the following diversity factors (without regard 

2 to order): 

3 ‘‘(i) Location in a coal-producing re4 gion that provides a majority of coal to the 

5 project. 

6 ‘‘(ii) Coal type, including waste coal. 

7 ‘‘(iii) Capture and transportation 

8 technologies. 

9 ‘‘(iv) Geological formations. 

10 ‘‘(v) New units and retrofit applica11 tions. 

12 ‘‘(k) ALLOCATION OF ALLOWANCES FOR DEPLOY13 MENT OF CARBON CAPTURE AND SEQUESTRATION TECH14 NOLOGY.— 

15 ‘‘(1) ANNUAL ALLOCATION.—The Adminis16 trator shall allocate emission allowances for the de17 ployment of carbon capture and sequestration tech18 nology in accordance with this section in the fol19 lowing quantities: 

20 ‘‘(A) For each of vintage years 2014 

21 through 2017, 1.75 percent of the emission al22 lowances established for each year under section 

23 721(a). 


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1 ‘‘(B) For each of vintage years 2018 and 

2 2019, 4.75 percent of the emission allowances 

3 established for each year under section 721(a). 

4 ‘‘(C) For each of vintage years 2020 

5 through 2050, 5 percent of the emission allow6 ances established for each year under section 

7 721(a). 

8 ‘‘(2) CARRYOVER.—If the Administrator has 

9 not distributed all of the allowances allocated pursu10 ant to this subsection for a given vintage year by the 

11 end of that year, the Administrator shall— 

12 ‘‘(A) auction those emission allowances in 

13 accordance with section 778 by not later than 

14 March 31 of the year following that vintage 

15 year; and 

16 ‘‘(B) increase the allocation under this 

17 subsection for the vintage year after the vintage 

18 year for which emission allowances were 

19 undisbursed by the quantity of undisbursed 

20 emission allowances, but only to the extent that 

21 allowances for that later year are to be auc22 tioned. 

23 ‘‘(l) DAVIS-BACON COMPLIANCE.— 

24 ‘‘(1) IN GENERAL.—All laborers and mechanics 

25 employed on projects funded directly by or assisted 


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1 in whole or in part by this section through the use 

2 of emission allowances shall be paid wages at rates 

3 not less than those prevailing on projects of a char4 acter similar in the locality as determined by the 

5 Secretary of Labor in accordance with subchapter 

6 IV of chapter 31 of title 40, United States Code. 

7 ‘‘(2) AUTHORITY.—With respect to the labor 

8 standards specified in this subsection, the Secretary 

9 of Labor shall have the authority and functions set 

10 forth in Reorganization Plan Numbered 14 of 1950 

11 (64 Stat. 1267; 5 U.S.C. App.) and section 3145 of 

12 title 40, United States Code. 

13 ‘‘SEC. 781. OVERSIGHT OF ALLOCATIONS. 

14 ‘‘(a) IN GENERAL.—Not later than January 1, 2014, 

15 and every 2 years thereafter, the Comptroller General of 

16 the United States shall carry out a review of programs 

17 administered by the Federal Government that distribute 

18 emission allowances or funds from any Federal auction of 

19 allowances. 

20 ‘‘(b) CONTENTS.—Each such report shall include a 

21 comprehensive evaluation of the administration and effec22 tiveness of each program, including— 

23 ‘‘(1) the efficiency, transparency, and sound24 ness of the administration of each program; 


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1 ‘‘(2) the performance of activities receiving as2 sistance under each program; 

3 ‘‘(3) the cost-effectiveness of each program in 

4 achieving the stated purposes of the program; and 

5 ‘‘(4) recommendations, if any, for regulatory or 

6 administrative changes to each program to improve 

7 its effectiveness. 

8 ‘‘(c) FOCUS.—In evaluating program performance, 

9 each review under this section review shall address the ef10 fectiveness of such programs in— 

11 ‘‘(1) creating and preserving jobs; 

12 ‘‘(2) ensuring a manageable transition for 

13 working families and workers; 

14 ‘‘(3) reducing the emissions, or enhancing se15 questration, of greenhouse gases; 

16 ‘‘(4) developing clean technologies; and 

17 ‘‘(5) building resilience to the impacts of cli18 mate change. 

19 ‘‘SEC. 782. EARLY ACTION RECOGNITION. 

20 ‘‘(a) IN GENERAL.—Emission allowances allocated 

21 pursuant to section 771(a)(7) shall be distributed by the 

22 Administrator in accordance with this section. Not later 

23 than 1 year after the date of enactment of this title, the 

24 Administrator shall issue regulations allowing— 


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1 ‘‘(1) any person in the United States to ex2 change instruments in the nature of offset credits 

3 issued before January 1, 2009, by a State, local, or 

4 voluntary offset program with respect to which the 

5 Administrator has made an affirmative determina6 tion under section 740(a)(2), for emission allowances 

7 established by the Administrator under section 

8 721(a); and 

9 ‘‘(2) the Administrator to provide compensation 

10 in the form of emission allowances to entities, in11 cluding units of local government, that do not meet 

12 the criteria of paragraph (1) and meet the criteria 

13 of this paragraph for documented early reductions or 

14 avoidance of greenhouse gas emissions or greenhouse 

15 gases sequestered before January 1, 2009, from 

16 projects or process improvements begun before Jan17 uary 1, 2009, where— 

18 ‘‘(A) the entity publicly stated greenhouse 

19 gas reduction goals and publicly reported 

20 against those goals; 

21 ‘‘(B) the entity demonstrated entity-wide 

22 net greenhouse gas reductions; and 

23 ‘‘(C) the entity demonstrates the actual 

24 projects or process improvements undertaken to 

25 make reductions and documents the reductions 


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1 (such as through documentation of engineering 

2 projects). 

3 ‘‘(b) REGULATIONS.—Regulations issued under sub4 section (a) shall— 

5 ‘‘(1) provide that a person exchanging credits 

6 under subsection (a)(1) receive emission allowances 

7 established under section 721(a) in an amount for 

8 which the monetary value is equivalent to the aver9 age monetary value of the credits during the period 

10 from January 1, 2006, to January 1, 2009, as ad11 justed for inflation to reflect current dollar values at 

12 the time of the exchange; 

13 ‘‘(2) provide that a person receiving compensa14 tion for documented early action under subsection 

15 (a)(2) shall receive emission allowances established 

16 under section 721(a) in an amount that is approxi17 mately equivalent in value to the carbon dioxide 

18 equivalent per ton value received by entities in ex19 change for credits under paragraph (1) (as adjusted 

20 for inflation to reflect current dollar values at the 

21 time of the exchange), as determined by the Admin22 istrator; 

23 ‘‘(3) provide that only reductions or avoidance 

24 of greenhouse gas emissions, or sequestration of 

25 greenhouse gases, achieved by activities in the 


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1 United States between January 1, 2001, and Janu2 ary 1, 2009, may be compensated under this section, 

3 and only credits issued for such activities may be ex4 changed under this section; 

5 ‘‘(4) provide that only credits that have not 

6 been retired or otherwise used to meet a voluntary 

7 or mandatory commitment, and have not expired, 

8 may be exchanged under subsection (a)(1); 

9 ‘‘(5) require that, once exchanged, the credit be 

10 retired for purposes of use under the program by or 

11 for which it was originally issued; and 

12 ‘‘(6) establish a deadline by which persons must 

13 exchange the credits or request compensation for 

14 early action under this section. 

15 ‘‘(c) PARTICIPATION.—Participation in an exchange 

16 of credits for allowances or compensation for early action 

17 authorized by this section shall not preclude any person 

18 from participation in an offset credit program established 

19 under part D. 

20 ‘‘(d) DISTRIBUTION.—Of the emission allowances 

21 distributed under this section, a quantity equal to 0.75 

22 percent of vintage year 2012 emission allowances estab23 lished under section 721(a) shall be distributed pursuant 

24 to subsection (a)(1), and a quantity equal to 0.25 percent 

25 of vintage year 2012 emission allowances established 


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1 under section 721(a) shall be distributed pursuant to sub2 section (a)(2). 

3 ‘‘SEC. 783. ESTABLISHMENT OF DEFICIT REDUCTION FUND. 

4 ‘‘(a) DEFICIT REDUCTION FUND.—There is estab5 lished in the Treasury of the United States a fund, to be 

6 known as the ‘Deficit Reduction Fund’. 

7 ‘‘(b) DISBURSEMENTS.—No disbursement shall be 

8 made from the Deficit Reduction Fund except pursuant 

9 to an appropriation Act.’’. 

10 Subtitle C—Additional Greenhouse 

11 Gas Standards 

12 SEC. 121. GREENHOUSE GAS STANDARDS. 

13 The Clean Air Act (42 U.S.C. 7401 et seq.), as 

14 amended by subtitles A and B of this title, is further 

15 amended by adding the following new title after title VII: 

16 ‘‘TITLE VIII—ADDITIONAL 

17 GREENHOUSE GAS STANDARDS 

18 ‘‘SEC. 801. DEFINITIONS. 

19 ‘‘For purposes of this title, terms that are defined 

20 in title VII, except for the term ‘stationary source’, shall 

21 have the meanings given those terms in title VII. 

22 ‘‘PART A—STATIONARY SOURCE STANDARDS 

23 ‘‘SEC. 811. STANDARDS OF PERFORMANCE. 

24 ‘‘(a) DEFINITION OF UNCAPPED GREENHOUSE GAS

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1 house gas emissions’ means those greenhouse gas emis2 sions to which section 722 does not apply. 

3 ‘‘(b) STANDARDS.—Before January 1, 2020, the Ad4 ministrator shall not promulgate new source performance 

5 standards for greenhouse gases under section 111 that are 

6 applicable to any stationary source that— 

7 ‘‘(1) emits uncapped greenhouse gas emissions; 

8 and 

9 ‘‘(2) qualifies as an eligible offset project pursu10 ant to section 733 that is eligible to receive an offset 

11 credit pursuant to section 737.’’. 

12 SEC. 122. HFC REGULATION. 

13 (a) IN GENERAL.—Title VI of the Clean Air Act (42 

14 U.S.C. 7671 et seq.) (relating to stratospheric ozone pro15 tection) is amended by adding at the end the following: 

16 ‘‘SEC. 619. HYDROFLUOROCARBONS (HFCS). 

17 ‘‘(a) TREATMENT AS CLASS II, GROUP II SUB18 STANCES.—Except as otherwise provided in this section, 

19 hydrofluorocarbons shall be treated as class II substances 

20 for purposes of applying the provisions of this title. The 

21 Administrator shall establish two groups of class II sub22 stances. Class II, group I substances shall include all 

23 hydrochlorofluorocarbons (HCFCs) listed pursuant to sec24 tion 602(b). Class II, group II substances shall include 

25 each of the following: 


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1 ‘‘(1) Hydrofluorocarbon-23 (HFC–23). 

2 ‘‘(2) Hydrofluorocarbon-32 (HFC–32). 

3 ‘‘(3) Hydrofluorocarbon-41 (HFC–41). 

4 ‘‘(4) Hydrofluorocarbon-125 (HFC–125). 

5 ‘‘(5) Hydrofluorocarbon-134 (HFC–134). 

6 ‘‘(6) Hydrofluorocarbon-134a (HFC–134a). 

7 ‘‘(7) Hydrofluorocarbon-143 (HFC–143). 

8 ‘‘(8) Hydrofluorocarbon-143a (HFC–143a). 

9 ‘‘(9) Hydrofluorocarbon-152 (HFC–152). 

10 ‘‘(10) Hydrofluorocarbon-152a (HFC–152a). 

11 ‘‘(11) Hydrofluorocarbon-227ea (HFC–227ea). 

12 ‘‘(12) Hydrofluorocarbon-236cb (HFC–236cb). 

13 ‘‘(13) Hydrofluorocarbon-236ea (HFC–236ea). 

14 ‘‘(14) Hydrofluorocarbon-236fa (HFC–236fa). 

15 ‘‘(15) Hydrofluorocarbon-245ca (HFC–245ca). 

16 ‘‘(16) Hydrofluorocarbon-245fa (HFC–245fa). 

17 ‘‘(17) Hydrofluorocarbon-365mfc (HFC– 

18 365mfc). 

19 ‘‘(18) Hydrofluorocarbon-43-10mee (HFC–43– 

20 10mee). 

21 ‘‘(19) Hydrofluoroolefin-1234yf (HFO–1234yf). 

22 ‘‘(20) Hydrofluoroolefin-1234ze (HFO–1234ze). 

23 Not later than 6 months after the date of enactment of 

24 this title, the Administrator shall publish an initial list of 

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1 stances listed in this subsection. The Administrator may 

2 add to the list of class II, group II substances any other 

3 substance used as a substitute for a class I or II substance 

4 if the Administrator determines that 1 metric ton of the 

5 substance makes the same or greater contribution to glob6 al warming over 100 years as 1 metric ton of carbon diox7 ide. Within 24 months after the date of enactment of this 

8 section, the Administrator shall amend the regulations 

9 under this title (including the regulations referred to in 

10 sections 603, 608, 609, 610, 611, 612, and 613) to apply 

11 to class II, group II substances. 

12 ‘‘(b) CONSUMPTION AND PRODUCTION OF CLASS II, 

13 GROUP II SUBSTANCES.— 

14 ‘‘(1) IN GENERAL.— 

15 ‘‘(A) CONSUMPTION PHASE DOWN.—In the 

16 case of class II, group II substances, in lieu of 

17 applying section 605 and the regulations there18 under, the Administrator shall promulgate reg19 ulations phasing down the consumption of class 

20 II, group II substances in the United States, 

21 and the importation of products containing any 

22 class II, group II substance, in accordance with 

23 this subsection within 18 months after the date 

24 of enactment of this section. Effective January 

25 1, 2012, it shall be unlawful for any person to 


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1 produce any class II, group II substance, im2 port any class II, group II substance, or import 

3 any product containing any class II, group II 

4 substance without holding one consumption al5 lowance or one destruction offset credit for each 

6 carbon dioxide equivalent ton of the class II, 

7 group II substance. Any person who exports a 

8 class II, group II substance for which a con9 sumption allowance was retired may receive a 

10 refund of that allowance from the Adminis11 trator following the export. 

12 ‘‘(B) PRODUCTION.—If the United States 

13 becomes a party or otherwise adheres to a mul14 tilateral agreement, including any amendment 

15 to the Montreal Protocol on Substances That 

16 Deplete the Ozone Layer, that restricts the pro17 duction of class II, group II substances, the Ad18 ministrator shall promulgate regulations estab19 lishing a baseline for the production of class II, 

20 group II substances in the United States and 

21 phasing down the production of class II, group 

22 II substances in the United States, in accord23 ance with such multilateral agreement and sub24 ject to the same exceptions and other provisions 

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1 sumption of class II, group II substances under 

2 this section (except that the Administrator shall 

3 not require a person who obtains production al4 lowances from the Administrator to make pay5 ment for such allowances if the person is mak6 ing payment for a corresponding quantity of 

7 consumption allowances of the same vintage 

8 year). Upon the effective date of such regula9 tions, it shall be unlawful for any person to 

10 produce any class II, group II substance with11 out holding one consumption allowance and one 

12 production allowance, or one destruction offset 

13 credit, for each carbon dioxide equivalent ton of 

14 the class II, group II substance. 

15 ‘‘(C) INTEGRITY OF LIMITS.—To maintain 

16 the integrity of the class II, group II limits, the 

17 Administrator may, through rulemaking, limit 

18 the percentage of each person’s compliance obli19 gation that may be met through the use of de20 struction offset credits or banked allowances. 

21 ‘‘(D) COUNTING OF VIOLATIONS.—Each 

22 consumption allowance, production allowance, 

23 or destruction offset credit not held as required 

24 by this section shall be a separate violation of 

25 this section. 


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1 ‘‘(2) SCHEDULE.—Pursuant to the regulations 

2 promulgated pursuant to paragraph (1)(A), the 

3 number of class II, group II consumption allowances 

4 established by the Administrator for each calendar 

5 year beginning in 2012 shall be the following per6 centage of the baseline, as established by the Admin7 istrator pursuant to paragraph (3): 

‘‘Calendar Year Percent of Baseline 

2012 90 

2013 87.5 

2014 85 

2015 82.5 

2016 80 

2017 77.5 

2018 75 

2019 71 

2020 67 

2021 63 

2022 59 

2023 54 

2024 50 

2025 46 

2026 42 

2027 38 

2028 34 

2029 30 

2030 25 


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‘‘Calendar Year Percent of Baseline 

2031 21 

2032 17 

after 2032 15 

1 ‘‘(3) BASELINE.—(A) Within 12 months after 

2 the date of enactment of this section, the Adminis3 trator shall promulgate regulations to establish the 

4 baseline for purposes of paragraph (2). The baseline 

5 shall be the sum, expressed in metric tons of carbon 

6 dioxide equivalents, of— 

7 ‘‘(i) the annual average consumption of all 

8 class II substances in calendar years 2004, 

9 2005, and 2006; plus 

10 ‘‘(ii) the annual average quantity of all 

11 class II substances contained in imported prod12 ucts in calendar years 2004, 2005, and 2006. 

13 ‘‘(B) Notwithstanding subparagraph (A), if the 

14 Administrator determines that the baseline is higher 

15 than 370 million metric tons of carbon dioxide 

16 equivalents, then the Administrator shall establish 

17 the baseline at 370 million metric tons of carbon di18 oxide equivalents. 

19 ‘‘(C) Notwithstanding subparagraph (A), if the 

20 Administrator determines that the baseline is lower 

21 than 280 million metric tons of carbon dioxide 


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1 equivalents, then the Administrator shall establish 

2 the baseline at 280 million metric tons of carbon di3 oxide equivalents. 

4 ‘‘(4) DISTRIBUTION OF ALLOWANCES.— 

5 ‘‘(A) IN GENERAL.—Pursuant to the regu6 lations promulgated under paragraph (1)(A), 

7 for each calendar year beginning in 2012, the 

8 Administrator shall sell consumption allowances 

9 in accordance with this paragraph. 

10 ‘‘(B) ESTABLISHMENT OF POOLS.—The 

11 Administrator shall establish two allowance 

12 pools. Eighty percent of the consumption allow13 ances available for a calendar year shall be 

14 placed in the producer-importer pool, and 20 

15 percent of the consumption allowances available 

16 for a calendar year shall be placed in the sec17 ondary pool. 

18 ‘‘(C) PRODUCER-IMPORTER POOL.— 

19 ‘‘(i) AUCTION.—(I) For each calendar 

20 year, the Administrator shall offer for sale 

21 at auction the following percentage of the 

22 consumption allowances in the producer23 importer pool: 

‘‘Calendar Year Percent Available for Auction 

2012 10 


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‘‘Calendar Year Percent Available for Auction 

2013 20 

2014 30 

2015 40 

2016 50 

2017 60 

2018 70 

2019 80 

2020 and thereafter 90 

1 ‘‘(II) Any person who produced or im2 ported any class II substance during cal3 endar year 2004, 2005, or 2006 may par4 ticipate in the auction. No other persons 

5 may participate in the auction unless per6 mitted to do so pursuant to subclause 

7 (III). 

8 ‘‘(III) Not later than 3 years after the 

9 date of the initial auction and from time to 

10 time thereafter, the Administrator shall de11 termine through rulemaking whether any 

12 persons who did not produce or import a 

13 class II substance during calendar year 

14 2004, 2005, or 2006 will be permitted to 

15 participate in future auctions. The Admin16 istrator shall base this determination on 

17 the duration, consistency, and scale of such 


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1 person’s purchases of consumption allow2 ances in the secondary pool under subpara3 graph (D)(ii)(III), as well as economic or 

4 technical hardship and other factors 

5 deemed relevant by the Administrator. 

6 ‘‘(IV) The Administrator shall set a 

7 minimum bid per consumption allowance of 

8 the following: 

9 ‘‘(aa) For vintage year 2012, 

10 $1.00. 

11 ‘‘(bb) For vintage year 2013, 

12 $1.20. 

13 ‘‘(cc) For vintage year 2014, 

14 $1.40. 

15 ‘‘(dd) For vintage year 2015, 

16 $1.60. 

17 ‘‘(ee) For vintage year 2016, 

18 $1.80. 

19 ‘‘(ff) For vintage year 2017, 

20 $2.00. 

21 ‘‘(gg) For vintage year 2018 and 

22 thereafter, $2.00 adjusted for infla23 tion after vintage year 2017 based 

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1 lished by the Department of Com2 merce. 

3 ‘‘(ii) NON-AUCTION SALE.—(I) For 

4 each calendar year, as soon as practicable 

5 after auction, the Administrator shall offer 

6 for sale the remaining consumption allow7 ances in the producer-importer pool at the 

8 following prices: 

9 ‘‘(aa) A fee of $1.00 per vintage 

10 year 2012 allowance. 

11 ‘‘(bb) A fee of $1.20 per vintage 

12 year 2013 allowance. 

13 ‘‘(cc) A fee of $1.40 per vintage 

14 year 2014 allowance. 

15 ‘‘(dd) For each vintage year 

16 2015 allowance, a fee equal to the av17 erage of $1.10 and the auction clear18 ing price for vintage year 2014 allow19 ances. 

20 ‘‘(ee) For each vintage year 2016 

21 allowance, a fee equal to the average 

22 of $1.30 and the auction clearing 

23 price for vintage year 2015 allow24 ances. 


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1 ‘‘(ff) For each vintage year 2017 

2 allowance, a fee equal to the average 

3 of $1.40 and the auction clearing 

4 price for vintage year 2016 allow5 ances. 

6 ‘‘(gg) For each allowance of vin7 tage year 2018 and subsequent vin8 tage years, a fee equal to the auction 

9 clearing price for that vintage year. 

10 ‘‘(II) The Administrator shall offer to 

11 sell the remaining consumption allowances 

12 in the producer-importer pool to producers 

13 of class II, group II substances and im14 porters of class II, group II substances in 

15 proportion to their relative allocation 

16 share. 

17 ‘‘(III) Such allocation share for such 

18 sale shall be determined by the Adminis19 trator using such producer’s or importer’s 

20 annual average data on class II substances 

21 from calendar years 2004, 2005, and 

22 2006, on a carbon dioxide equivalent basis, 

23 and— 

24 ‘‘(aa) shall be based on a pro25 ducer’s production, plus importation, 


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1 plus acquisitions and purchases from 

2 persons who produced class II sub3 stances in the United States during 

4 calendar year 2004, 2005, or 2006, 

5 less exportation, less transfers and 

6 sales to persons who produced class II 

7 substances in the United States dur8 ing calendar year 2004, 2005, or 

9 2006; and 

10 ‘‘(bb) for an importer of class II 

11 substances that did not produce in the 

12 United States any class II substance 

13 during calendar years 2004, 2005, 

14 and 2006, shall be based on the im15 porter’s importation less exportation. 

16 For purposes of item (aa), the Adminis17 trator shall account for 100 percent of 

18 class II, group II substances and 60 per19 cent of class II, group I substances. For 

20 purposes of item (bb), the Administrator 

21 shall account for 100 percent of class II, 

22 group II substances and 100 percent of 

23 class II, group I substances. 

24 ‘‘(IV) Any consumption allowances 

25 made available for nonauction sale to a 


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1 specific producer or importer of class II, 

2 group II substances but not purchased by 

3 the specific producer or importer shall be 

4 made available for sale to any producer or 

5 importer of class II substances during cal6 endar year 2004, 2005, or 2006. If de7 mand for such consumption allowances ex8 ceeds supply of such consumption allow9 ances, the Administrator shall develop and 

10 utilize criteria for the sale of such con11 sumption allowances that may include pro 

12 rata shares, historic production and impor13 tation, economic or technical hardship, or 

14 other factors deemed relevant by the Ad15 ministrator. If the supply of such con16 sumption allowances exceeds demand, the 

17 Administrator may offer such consumption 

18 allowances for sale in the secondary pool as 

19 set forth in subparagraph (D). 

20 ‘‘(D) SECONDARY POOL.—(i) For each cal21 endar year, as soon as practicable after the auc22 tion required in subparagraph (C), the Adminis23 trator shall offer for sale the consumption al24 lowances in the secondary pool at the prices 

25 listed in subparagraph (C)(ii). 


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1 ‘‘(ii) The Administrator shall accept appli2 cations for purchase of secondary pool con3 sumption allowances from— 

4 ‘‘(I) importers of products containing 

5 class II, group II substances; 

6 ‘‘(II) persons who purchased any class 

7 II, group II substance directly from a pro8 ducer or importer of class II, group II sub9 stances for use in a product containing a 

10 class II, group II substance, a manufac11 turing process, or a reclamation process; 

12 ‘‘(III) persons who did not produce or 

13 import a class II substance during cal14 endar year 2004, 2005, or 2006, but who 

15 the Administrator determines have subse16 quently taken significant steps to produce 

17 or import a substantial quantity of any 

18 class II, group II substance; and 

19 ‘‘(IV) persons who produced or im20 ported any class II substance during cal21 endar year 2004, 2005, or 2006. 

22 ‘‘(iii) If the supply of consumption allow23 ances in the secondary pool equals or exceeds 

24 the demand for consumption allowances in the 

25 secondary pool as presented in the applications 


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1 for purchase, the Administrator shall sell the 

2 consumption allowances in the secondary pool 

3 to the applicants in the amounts requested in 

4 the applications for purchase. Any consumption 

5 allowances in the secondary pool not purchased 

6 in a calendar year may be rolled over and added 

7 to the quantity available in the secondary pool 

8 in the following year. 

9 ‘‘(iv) If the demand for consumption allow10 ances in the secondary pool as presented in the 

11 applications for purchase exceeds the supply of 

12 consumption allowances in the secondary pool, 

13 the Administrator shall sell the consumption al14 lowances as follows: 

15 ‘‘(I) The Administrator shall first sell 

16 the consumption allowances in the sec17 ondary pool to any importers of products 

18 containing class II, group II substances in 

19 the amounts requested in their applications 

20 for purchase. If the demand for such con21 sumption allowances exceeds supply of 

22 such consumption allowances, the Adminis23 trator shall develop and utilize criteria for 

24 the sale of such consumption allowances 

25 among importers of products containing 


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1 class II, group II substances that may in2 clude pro rata shares, historic importation, 

3 economic or technical hardship, or other 

4 factors deemed relevant by the Adminis5 trator. 

6 ‘‘(II) The Administrator shall next 

7 sell any remaining consumption allowances 

8 to persons identified in subclauses (II) and 

9 (III) of clause (ii) in the amounts re10 quested in their applications for purchase. 

11 If the demand for such consumption allow12 ances exceeds remaining supply of such 

13 consumption allowances, the Administrator 

14 shall develop and utilize criteria for the 

15 sale of such consumption allowances 

16 among subclauses (II) and (III) applicants 

17 that may include pro rata shares, historic 

18 use, economic or technical hardship, or 

19 other factors deemed relevant by the Ad20 ministrator. 

21 ‘‘(III) The Administrator shall then 

22 sell any remaining consumption allowances 

23 to persons who produced or imported any 

24 class II substance during calendar year 

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1 quested in their applications for purchase. 

2 If demand for such consumption allow3 ances exceeds remaining supply of such 

4 consumption allowances, the Administrator 

5 shall develop and utilize criteria for the 

6 sale of such consumption allowances that 

7 may include pro rata shares, historic pro8 duction and importation, economic or tech9 nical hardship, or other factors deemed rel10 evant by the Administrator. 

11 ‘‘(IV) Each person who purchases 

12 consumption allowances in a non-auction 

13 sale under this subparagraph shall be re14 quired to disclose the person or entity 

15 sponsoring or benefitting from the pur16 chases if such person or entity is, in whole 

17 or in part, other than the purchaser or the 

18 purchaser’s employer. 

19 ‘‘(E) DISCRETION TO WITHHOLD ALLOW20 ANCES.—Nothing in this paragraph prevents 

21 the Administrator from exercising discretion to 

22 withhold and retire consumption allowances 

23 that would otherwise be available for auction or 

24 nonauction sale. Not later than 18 months after 

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1 ministrator shall promulgate regulations estab2 lishing criteria for withholding and retiring con3 sumption allowances. 

4 ‘‘(5) BANKING.—A consumption allowance or 

5 destruction offset credit may be used to meet the 

6 compliance obligation requirements of paragraph (1) 

7 in— 

8 ‘‘(A) the vintage year for the allowance or 

9 destruction offset credit; or 

10 ‘‘(B) any calendar year subsequent to the 

11 vintage year for the allowance or destruction 

12 offset credit. 

13 ‘‘(6) AUCTIONS.— 

14 ‘‘(A) INITIAL REGULATIONS.—Not later 

15 than 18 months after the date of enactment of 

16 this section, the Administrator shall promulgate 

17 regulations governing the auction of allowances 

18 under this section. Such regulations shall in19 clude the following requirements: 

20 ‘‘(i) FREQUENCY; FIRST AUCTION.— 

21 Auctions shall be held one time per year at 

22 regular intervals, with the first auction to 

23 be held no later than October 31, 2011. 


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1 ‘‘(ii) AUCTION FORMAT.—Auctions 

2 shall follow a single-round, sealed-bid, uni3 form price format. 

4 ‘‘(iii) FINANCIAL ASSURANCE.—The 

5 Administrator may establish financial as6 surance requirements to ensure that auc7 tion participants can and will perform on 

8 their bids. 

9 ‘‘(iv) DISCLOSURE OF BENEFICIAL

10 OWNERSHIP.—Each bidder in the auction 

11 shall be required to disclose the person or 

12 entity sponsoring or benefitting from the 

13 bidder’s participation in the auction if such 

14 person or entity is, in whole or in part, 

15 other than the bidder. 

16 ‘‘(v) PUBLICATION OF INFORMA17 TION.—After the auction, the Adminis18 trator shall, in a timely fashion, publish 

19 the number of bidders, number of winning 

20 bidders, the quantity of allowances sold, 

21 and the auction clearing price. 

22 ‘‘(vi) BIDDING LIMITS IN 2012.—In 

23 the vintage year 2012 auction, no auction 

24 participant may, directly or in concert with 

25 another participant, bid for or purchase 


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1 more allowances offered for sale at the 

2 auction than the greater of— 

3 ‘‘(I) the number of allowances 

4 which, when added to the number of 

5 allowances available for purchase by 

6 the participant in the producer-im7 porter pool non-auction sale, would 

8 equal the participant’s annual average 

9 consumption of class II, group II sub10 stances in calendar years 2004, 2005, 

11 and 2006; or 

12 ‘‘(II) the number of allowances 

13 equal to the product of— 

14 ‘‘(aa) 1.20 multiplied by the 

15 participant’s allocation share of 

16 the producer-importer pool non17 auction sale as determined under 

18 paragraph (4)(C)(ii); and 

19 ‘‘(bb) the number of vintage 

20 year 2012 allowances offered at 

21 auction. 

22 ‘‘(vii) BIDDING LIMITS IN 2013.—In 

23 the vintage year 2013 auction, no auction 

24 participant may, directly or in concert with 

25 another participant, bid for or purchase 


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1 more allowances offered for sale at the 

2 auction than the product of— 

3 ‘‘(I) 1.15 multiplied by the ratio 

4 of the total number of vintage year 

5 2012 allowances purchased by the 

6 participant from the auction and from 

7 the producer-importer pool non-auc8 tion sale to the total number of vin9 tage year 2012 allowances in the pro10 ducer-importer pool; and 

11 ‘‘(II) the number of vintage year 

12 2013 allowances offered at auction. 

13 ‘‘(viii) BIDDING LIMITS IN SUBSE14 QUENT YEARS.—In the auctions for vin15 tage year 2014 and subsequent vintage 

16 years, no auction participant may, directly 

17 or in concert with another participant, bid 

18 for or purchase more allowances offered 

19 for sale at the auction than the product 

20 of— 

21 ‘‘(I) 1.15 multiplied by the ratio 

22 of the highest number of allowances 

23 required to be held by the participant 

24 in any of the three prior vintage years 

25 to meet its compliance obligation 


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1 under paragraph (1) to the total num2 ber of allowances in the producer-im3 porter pool for such vintage year; and 

4 ‘‘(II) the number of allowances 

5 offered at auction for that vintage 

6 year. 

7 ‘‘(ix) OTHER REQUIREMENTS.—The 

8 Administrator may include in the regula9 tions such other requirements or provisions 

10 as the Administrator considers necessary 

11 to promote effective, efficient, transparent, 

12 and fair administration of auctions under 

13 this section. 

14 ‘‘(B) REVISION OF REGULATIONS.—The 

15 Administrator may, at any time, revise the ini16 tial regulations promulgated under subpara17 graph (A) based on the Administrator’s experi18 ence in administering allowance auctions by 

19 promulgating new regulations. Such revised reg20 ulations need not meet the requirements identi21 fied in subparagraph (A) if the Administrator 

22 determines that an alternative auction design 

23 would be more effective, taking into account 

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1 nipulation. In determining whether and how to 

2 revise the initial regulations under this para3 graph, the Administrator shall not consider 

4 maximization of revenues to the Federal Gov5 ernment. 

6 ‘‘(C) DELEGATION OR CONTRACT.—Pursu7 ant to regulations under this section, the Ad8 ministrator may, by delegation or contract, pro9 vide for the conduct of auctions under the Ad10 ministrator’s supervision by other departments 

11 or agencies of the Federal Government or by 

12 nongovernmental agencies, groups, or organiza13 tions. 

14 ‘‘(7) PAYMENTS FOR ALLOWANCES.— 

15 ‘‘(A) INITIAL REGULATIONS.—Not later 

16 than 18 months after the date of enactment of 

17 this section, the Administrator shall promulgate 

18 regulations governing the payment for allow19 ances purchased in auction and non-auction 

20 sales under this section. Such regulations shall 

21 include the requirement that, in the event that 

22 full payment for purchased allowances is not 

23 made on the date of purchase, equal payments 

24 shall be made one time per calendar quarter 


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1 with all payments for allowances of a vintage 

2 year made by the end of that vintage year. 

3 ‘‘(B) REVISION OF REGULATIONS.—The 

4 Administrator may, at any time, revise the ini5 tial regulations promulgated under subpara6 graph (A) based on the Administrator’s experi7 ence in administering collection of payments by 

8 promulgating new regulations. Such revised reg9 ulations need not meet the requirements identi10 fied in subparagraph (A) if the Administrator 

11 determines that an alternative payment struc12 ture or frequency would be more effective, tak13 ing into account factors including cost of ad14 ministration, transparency, and fairness. In de15 termining whether and how to revise the initial 

16 regulations under this paragraph, the Adminis17 trator shall not consider maximization of reve18 nues to the Federal Government. 

19 ‘‘(C) PENALTIES FOR NON-PAYMENT.— 

20 Failure to pay for purchased allowances in ac21 cordance with the regulations promulgated pur22 suant to this paragraph shall be a violation of 

23 the requirements of subsection (b). Section 

24 113(c)(3) shall apply in the case of any person 

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1 ances in accordance with the regulations pro2 mulgated pursuant to this paragraph. 

3 ‘‘(8) IMPORTED PRODUCTS.—If the United 

4 States becomes a party or otherwise adheres to a 

5 multilateral agreement, including any amendment to 

6 the Montreal Protocol on Substances That Deplete 

7 the Ozone Layer, which restricts the production or 

8 consumption of class II, group II substances— 

9 ‘‘(A) as of the date on which such agree10 ment or amendment enters into force, it shall 

11 no longer be unlawful for any person to import 

12 from a party to such agreement or amendment 

13 any product containing any class II, group II 

14 substance whose production or consumption is 

15 regulated by such agreement or amendment 

16 without holding one consumption allowance or 

17 one destruction offset credit for each carbon di18 oxide equivalent ton of the class II, group II 

19 substance; 

20 ‘‘(B) the Administrator shall promulgate 

21 regulations within 12 months of the date the 

22 United States becomes a party or otherwise ad23 heres to such agreement or amendment, or the 

24 date on which such agreement or amendment 

25 enters into force, whichever is later, to establish 


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1 a new baseline for purposes of paragraph (2), 

2 which new baseline shall be the original baseline 

3 less the carbon dioxide equivalent of the annual 

4 average quantity of any class II substances reg5 ulated by such agreement or amendment con6 tained in products imported from parties to 

7 such agreement or amendment in calendar 

8 years 2004, 2005, and 2006; 

9 ‘‘(C) as of the date on which such agree10 ment or amendment enters into force, no per11 son importing any product containing any class 

12 II, group II substance may, directly or in con13 cert with another person, purchase any con14 sumption allowances for sale by the Adminis15 trator for the importation of products from a 

16 party to such agreement or amendment that 

17 contain any class II, group II substance re18 stricted by such agreement or amendment; and 

19 ‘‘(D) the Administrator may adjust the 

20 two allowance pools established in paragraph 

21 (4) such that up to 90 percent of the consump22 tion allowances available for a calendar year are 

23 placed in the producer-importer pool with the 

24 remaining consumption allowances placed in the 

25 secondary pool. 


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1 ‘‘(9) OFFSETS.— 

2 ‘‘(A) CHLOROFLUOROCARBON DESTRUC3 TION.—Within 18 months after the date of en4 actment of this section, the Administrator shall 

5 promulgate regulations to provide for the 

6 issuance of offset credits for the destruction, in 

7 the calendar year 2012 or later, of 

8 chlorofluorocarbons in the United States. The 

9 Administrator shall establish and distribute to 

10 the destroying entity a quantity of destruction 

11 offset credits equal to 0.8 times the number of 

12 metric tons of carbon dioxide equivalents of re13 duction achieved through the destruction. No 

14 destruction offset credits shall be established 

15 for the destruction of a class II, group II sub16 stance. 

17 ‘‘(B) DEFINITION.—For purposes of this 

18 paragraph, the term ‘destruction’ means the 

19 conversion of a substance by thermal, chemical, 

20 or other means to another substance with little 

21 or no carbon dioxide equivalent value and no 

22 ozone depletion potential. 

23 ‘‘(C) REGULATIONS.—The regulations pro24 mulgated under this paragraph shall include 

25 standards and protocols for project eligibility, 


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1 certification of destroyers, monitoring, tracking, 

2 destruction efficiency, quantification of project 

3 and baseline emissions and carbon dioxide 

4 equivalent value, and verification. The Adminis5 trator shall ensure that destruction offset cred6 its represent real and verifiable destruction of 

7 chlorofluorocarbons or other class I or class II, 

8 group I, substances authorized under subpara9 graph (D). 

10 ‘‘(D) OTHER SUBSTANCES.—The Adminis11 trator may promulgate regulations to add to the 

12 list of class I and class II, group I, substances 

13 that may be destroyed for destruction offset 

14 credits, taking into account a candidate sub15 stance’s carbon dioxide equivalent value, ozone 

16 depletion potential, prevalence in banks in the 

17 United States, and emission rates, as well as 

18 the need for additional cost containment under 

19 the class II, group II limits and the integrity of 

20 the class II, group II limits. The Administrator 

21 shall not add a class I or class II, group I sub22 stance to the list if the consumption of the sub23 stance has not been completely phased-out 

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1 tions or other similar exemptions) pursuant to 

2 the Montreal Protocol. 

3 ‘‘(E) EXTENSION OF OFFSETS.—(i) At any 

4 time after the Administrator promulgates regu5 lations pursuant to subparagraph (A), the Ad6 ministrator may, pursuant to the requirements 

7 of part D of title VII and based on the carbon 

8 dioxide equivalent value of the substance de9 stroyed, add the types of destruction projects 

10 authorized to receive destruction offset credits 

11 under this paragraph to the list of types of 

12 projects eligible for offset credits under section 

13 733. If such projects are added to the list under 

14 section 733, the issuance of offset credits for 

15 such projects under part D of title VII shall be 

16 governed by the requirements of such part D, 

17 while the issuance of offset credits for such 

18 projects under this paragraph shall be governed 

19 by the requirements of this paragraph. Nothing 

20 in this paragraph shall affect the issuance of 

21 offset credits under section 740. 

22 ‘‘(ii) The Administrator shall not make the 

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1 graph and that the addition would increase de2 struction. 

3 ‘‘(iii) In no event shall more than one de4 struction offset credit be issued under title VII 

5 and this section for the destruction of the same 

6 quantity of a substance. 

7 ‘‘(10) LEGAL STATUS OF ALLOWANCES AND

8 CREDITS.—None of the following constitutes a prop9 erty right: 

10 ‘‘(A) A production or consumption allow11 ance. 

12 ‘‘(B) A destruction offset credit. 

13 ‘‘(c) DEADLINES FOR COMPLIANCE.—Notwith14 standing the deadlines specified for class II substances in 

15 sections 608, 609, 610, 612, and 613 that occur prior to 

16 January 1, 2009, the deadline for promulgating regula17 tions under those sections for class II, group II substances 

18 shall be January 1, 2012. 

19 ‘‘(d) EXCEPTIONS FOR ESSENTIAL USES.—Notwith20 standing any phase down of production and consumption 

21 required by this section, to the extent consistent with any 

22 applicable multilateral agreement to which the United 

23 States is a party or otherwise adheres, the Administrator 

24 shall consider providing exceptions for essential uses under 


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1 paragraph (1) and may provide exceptions for essential 

2 uses under paragraph (2), as follows: 

3 ‘‘(1) MEDICAL DEVICES.—If the Administrator 

4 makes the determination under this subsection that 

5 a medical device is eligible for an exception, after no6 tice and opportunity for public comment, and in con7 sultation with the Commissioner of Food and Drugs, 

8 the Administrator shall provide an exception for the 

9 production and consumption of class II, group II 

10 substances solely for use in medical devices, such as 

11 metered dose inhalers. 

12 ‘‘(2) AVIATION AND SPACE VEHICLE SAFETY.— 

13 The Administrator, after notice and opportunity for 

14 public comment, may authorize the production and 

15 consumption of limited quantities of class II, group 

16 II substances solely for the purposes of aviation or 

17 space vehicle safety if either the Administrator of 

18 the Federal Aviation Administration or the Adminis19 trator of the National Aeronautics and Space Ad20 ministration, in consultation with the Administrator, 

21 determines that no safe and effective substitute has 

22 been developed and that such authorization is nec23 essary for aviation or space flight safety purposes. 

24 ‘‘(e) DEVELOPING COUNTRIES.—Notwithstanding 

25 any phase down of production required by this section, the 


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1 Administrator, after notice and opportunity for public 

2 comment, may authorize the production of limited quan3 tities of class II, group II substances in excess of the 

4 amounts otherwise allowable under this section solely for 

5 export to, and use in, developing countries. Any produc6 tion authorized under this subsection shall be solely for 

7 purposes of satisfying the basic domestic needs of such 

8 countries as provided in applicable international agree9 ments, if any, to which the United States is a party or 

10 otherwise adheres. 

11 ‘‘(f) NATIONAL SECURITY; FIRE SUPPRESSION, 

12 ETC.—The provisions of subsection (f) and paragraphs (1) 

13 and (2) of subsection (g) of section 604 shall apply to any 

14 consumption and production phase down of class II, group 

15 II substances in the same manner and to the same extent, 

16 consistent with any applicable international agreement to 

17 which the United States is a party or otherwise adheres, 

18 as such provisions apply to the substances specified in 

19 such subsection. 

20 ‘‘(g) ACCELERATED SCHEDULE.—In lieu of section 

21 606, the provisions of paragraphs (1), (2), and (3) of this 

22 subsection shall apply in the case of class II, group II sub23 stances. 

24 ‘‘(1) IN GENERAL.—The Administrator shall 

25 promulgate initial regulations not later than 18 


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1 months after the date of enactment of this section, 

2 and revised regulations any time thereafter, which 

3 establish a schedule for phasing down the consump4 tion (and, if the condition in subsection (b)(1)(B) is 

5 met, the production) of class II, group II substances 

6 that is more stringent than the schedule set forth in 

7 this section if, based on the availability of sub8 stitutes, the Administrator determines that such 

9 more stringent schedule is practicable, taking into 

10 account technological achievability, safety, and other 

11 factors the Administrator deems relevant, or if the 

12 Montreal Protocol, or any applicable international 

13 agreement to which the United States is a party or 

14 otherwise adheres, is modified or established to in15 clude a schedule or other requirements to control or 

16 reduce production, consumption, or use of any class 

17 II, group II substance more rapidly than the appli18 cable schedule under this section. 

19 ‘‘(2) PETITION.—Any person may submit a pe20 tition to promulgate regulations under this sub21 section in the same manner and subject to the same 

22 procedures as are provided in section 606(b). 

23 ‘‘(3) INCONSISTENCY.—If the Administrator de24 termines that the provisions of this section regarding 

25 banking, allowance rollover, or destruction offset 


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1 credits create a significant potential for inconsist2 ency with the requirements of any applicable inter3 national agreement to which the United States is a 

4 party or otherwise adheres, the Administrator may 

5 promulgate regulations restricting the availability of 

6 banking, allowance rollover, or destruction offset 

7 credits to the extent necessary to avoid such incon8 sistency. 

9 ‘‘(h) EXCHANGE.—Section 607 shall not apply in the 

10 case of class II, group II substances. Production and con11 sumption allowances for class II, group II substances may 

12 be freely exchanged or sold but may not be converted into 

13 allowances for class II, group I substances. 

14 ‘‘(i) LABELING.—(1) In applying section 611 to prod15 ucts containing or manufactured with class II, group II 

16 substances, in lieu of the words ‘destroying ozone in the 

17 upper atmosphere’ on labels required under section 611 

18 there shall be substituted the words ‘contributing to global 

19 warming’. 

20 ‘‘(2) The Administrator may, through rulemaking, 

21 exempt from the requirements of section 611 products 

22 containing or manufactured with class II, group II sub23 stances determined to have little or no carbon dioxide 

24 equivalent value compared to other substances used in 

25 similar products. 


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1 ‘‘(j) NONESSENTIAL PRODUCTS.—For the purposes 

2 of section 610, class II, group II substances shall be regu3 lated under section 610(b), except that in applying section 

4 610(b) the word ‘hydrofluorocarbon’ shall be substituted 

5 for the word ‘chlorofluorocarbon’ and the term ‘class II, 

6 group II’ shall be substituted for the term ‘class I’. Class 

7 II, group II substances shall not be subject to the provi8 sions of section 610(d). 

9 ‘‘(k) INTERNATIONAL TRANSFERS.—In the case of 

10 class II, group II substances, in lieu of section 616, this 

11 subsection shall apply. To the extent consistent with any 

12 applicable international agreement to which the United 

13 States is a party or otherwise adheres, including any 

14 amendment to the Montreal Protocol, the United States 

15 may engage in transfers with other parties to such agree16 ment or amendment under the following conditions: 

17 ‘‘(1) The United States may transfer produc18 tion allowances to another party to such agreement 

19 or amendment if, at the time of the transfer, the 

20 Administrator establishes revised production limits 

21 for the United States accounting for the transfer in 

22 accordance with regulations promulgated pursuant 

23 to this subsection. 

24 ‘‘(2) The United States may acquire production 

25 allowances from another party to such agreement or 


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1 amendment if, at the time of the transfer, the Ad2 ministrator finds that the other party has revised its 

3 domestic production limits in the same manner as 

4 provided with respect to transfers by the United 

5 States in the regulations promulgated pursuant to 

6 this subsection. 

7 ‘‘(l) RELATIONSHIP TO OTHER LAWS.— 

8 ‘‘(1) STATE LAWS.—For purposes of section 

9 116, the requirements of this section for class II, 

10 group II substances shall be treated as requirements 

11 for the control and abatement of air pollution. 

12 ‘‘(2) MULTILATERAL AGREEMENTS.—Section 

13 614 shall apply to the provisions of this section con14 cerning class II, group II substances, except that for 

15 the words ‘Montreal Protocol’ there shall be sub16 stituted the words ‘Montreal Protocol, or any appli17 cable multilateral agreement to which the United 

18 States is a party or otherwise adheres that restricts 

19 the production or consumption of class II, group II 

20 substances,’ and for the words ‘Article 4 of the Mon21 treal Protocol’ there shall be substituted ‘any provi22 sion of such multilateral agreement regarding trade 

23 with non-parties’. 

24 ‘‘(3) FEDERAL FACILITIES.—For purposes of 

25 section 118, the requirements of this section for 


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1 class II, group II substances and corresponding 

2 State, interstate, and local requirements, administra3 tive authority, and process and sanctions shall be 

4 treated as requirements for the control and abate5 ment of air pollution within the meaning of section 

6 118. 

7 ‘‘(m) CARBON DIOXIDE EQUIVALENT VALUE.—(1) 

8 In lieu of section 602(e), the provisions of this subsection 

9 shall apply in the case of class II, group II substances. 

10 Simultaneously with establishing the list of class II, group 

11 II substances, and simultaneously with any addition to 

12 that list, the Administrator shall publish the carbon diox13 ide equivalent value of each listed class II, group II sub14 stance, based on a determination of the number of metric 

15 tons of carbon dioxide that makes the same contribution 

16 to global warming over 100 years as 1 metric ton of each 

17 class II, group II substance. 

18 ‘‘(2) Not later than February 1, 2017, and not less 

19 than every 5 years thereafter, the Administrator shall— 

20 ‘‘(A) review, and if appropriate, revise the car21 bon dioxide equivalent values established for class II, 

22 group II substances based on a determination of the 

23 number of metric tons of carbon dioxide that makes 

24 the same contributions to global warming over 100 


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1 years as 1 metric ton of each class II, group II sub2 stance; and 

3 ‘‘(B) publish in the Federal Register the results 

4 of that review and any revisions. 

5 ‘‘(3) A revised determination published in the Federal 

6 Register under paragraph (2)(B) shall take effect for pro7 duction of class II, group II substances, consumption of 

8 class II, group II substances, and importation of products 

9 containing class II, group II substances starting on Janu10 ary 1 of the first calendar year starting at least 9 months 

11 after the date on which the revised determination was pub12 lished. 

13 ‘‘(4) The Administrator may decrease the frequency 

14 of review and revision under paragraph (2) if the Adminis15 trator determines that such decrease is appropriate in 

16 order to synchronize such review and revisions with any 

17 similar review process carried out pursuant to the United 

18 Nations Framework Convention on Climate Change, an 

19 agreement negotiated under that convention, The Vienna 

20 Convention for the Protection of the Ozone Layer, or an 

21 agreement negotiated under that convention, except that 

22 in no event shall the Administrator carry out such review 

23 and revision any less frequently than every 10 years. 

24 ‘‘(n) REPORTING REQUIREMENTS.—In lieu of sub25 sections (b) and (c) of section 603, paragraphs (1) and 


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1 (2) of this subsection shall apply in the case of class II, 

2 group II substances: 

3 ‘‘(1) IN GENERAL.—On a quarterly basis, or 

4 such other basis (not less than annually) as deter5 mined by the Administrator, each person who pro6 duced, imported, or exported a class II, group II 

7 substance, or who imported a product containing a 

8 class II, group II substance, shall file a report with 

9 the Administrator setting forth the carbon dioxide 

10 equivalent amount of the substance that such person 

11 produced, imported, or exported, as well as the 

12 amount that was contained in products imported by 

13 that person, during the preceding reporting period. 

14 Each such report shall be signed and attested by a 

15 responsible officer. If all other reporting is complete, 

16 no such report shall be required from a person after 

17 April 1 of the calendar year after such person per18 manently ceases production, importation, and expor19 tation of the substance, as well as importation of 

20 products containing the substance, and so notifies 

21 the Administrator in writing. If the United States 

22 becomes a party or otherwise adheres to a multilat23 eral agreement, including any amendment to the 

24 Montreal Protocol on Substances That Deplete the 

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1 sumption of class II, group II substances, then, if all 

2 other reporting is complete, no such report shall be 

3 required from a person with respect to importation 

4 from parties to such agreement or amendment of 

5 products containing any class II, group II substance 

6 restricted by such agreement or amendment, after 

7 April 1 of the calendar year following the year dur8 ing which such agreement or amendment enters into 

9 force. 

10 ‘‘(2) BASELINE REPORTS FOR CLASS II, GROUP

11 II SUBSTANCES.— 

12 ‘‘(A) IN GENERAL.—Unless such informa13 tion has been previously reported to the Admin14 istrator, on the date on which the first report 

15 under paragraph (1) of this subsection is re16 quired to be filed, each person who produced, 

17 imported, or exported a class II, group II sub18 stance, or who imported a product containing a 

19 class II substance, (other than a substance 

20 added to the list of class II, group II substances 

21 after the publication of the initial list of such 

22 substances under this section), shall file a re23 port with the Administrator setting forth the 

24 amount of such substance that such person pro25 duced, imported, exported, or that was conVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00729 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 tained in products imported by that person, 

2 during each of calendar years 2004, 2005, and 

3 2006. 

4 ‘‘(B) PRODUCERS.—In reporting under 

5 subparagraph (A), each person who produced in 

6 the United States a class II substance during 

7 calendar year 2004, 2005, or 2006 shall— 

8 ‘‘(i) report all acquisitions or pur9 chases of class II substances during each 

10 of calendar years 2004, 2005, and 2006 

11 from all other persons who produced in the 

12 United States a class II substance during 

13 calendar year 2004, 2005, or 2006, and 

14 supply evidence of such acquisitions and 

15 purchases as deemed necessary by the Ad16 ministrator; and 

17 ‘‘(ii) report all transfers or sales of 

18 class II substances during each of calendar 

19 years 2004, 2005, and 2006 to all other 

20 persons who produced in the United States 

21 a class II substance during calendar year 

22 2004, 2005, or 2006, and supply evidence 

23 of such transfers and sales as deemed nec24 essary by the Administrator. 


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1 ‘‘(C) ADDED SUBSTANCES.—In the case of 

2 a substance added to the list of class II, group 

3 II substances after publication of the initial list 

4 of such substances under this section, each per5 son who produced, imported, exported, or im6 ported products containing such substance in 

7 calendar year 2004, 2005, or 2006 shall file a 

8 report with the Administrator within 180 days 

9 after the date on which such substance is added 

10 to the list, setting forth the amount of the sub11 stance that such person produced, imported, 

12 and exported, as well as the amount that was 

13 contained in products imported by that person, 

14 in calendar years 2004, 2005, and 2006. 

15 ‘‘(o) STRATOSPHERIC OZONE AND CLIMATE PROTEC16 TION FUND.— 

17 ‘‘(1) IN GENERAL.—There is established in the 

18 Treasury of the United States a Stratospheric Ozone 

19 and Climate Protection Fund. 

20 ‘‘(2) DEPOSITS.—The Administrator shall de21 posit all proceeds from the auction and non-auction 

22 sale of allowances under this section into the Strato23 spheric Ozone and Climate Protection Fund. 

24 ‘‘(3) USE.—Amounts deposited into the Strato25 spheric Ozone and Climate Protection Fund shall be 


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1 available, subject to appropriations, exclusively for 

2 the following purposes: 

3 ‘‘(A) RECOVERY, RECYCLING, AND REC4 LAMATION.—The Administrator may utilize 

5 funds to establish a program to incentivize the 

6 recovery, recycling, and reclamation of any 

7 Class II substances in order to reduce emissions 

8 of such substances. 

9 ‘‘(B) MULTILATERAL FUND.—If the 

10 United States becomes a party or otherwise ad11 heres to a multilateral agreement, including any 

12 amendment to the Montreal Protocol on Sub13 stances That Deplete the Ozone Layer, which 

14 restricts the production or consumption of class 

15 II, group II substances, the Administrator may 

16 utilize funds to meet any related contribution 

17 obligation of the United States to the Multilat18 eral Fund for the Implementation of the Mon19 treal Protocol or similar multilateral fund es20 tablished under such multilateral agreement. 

21 ‘‘(C) LOW GLOBAL WARMING PRODUCT

22 TRANSITION ASSISTANCE PROGRAM.— 

23 ‘‘(i) IN GENERAL.—The Adminis24 trator, in consultation with the Secretary 

25 of Energy, may utilize funds in fiscal years 


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1 2012 through 2022 to establish a program 

2 to provide financial assistance to manufac3 turers of products containing class II, 

4 group II substances to facilitate the transi5 tion to products that contain or utilize al6 ternative substances with no or low carbon 

7 dioxide equivalent value and no ozone de8 pletion potential. 

9 ‘‘(ii) DEFINITION.—In this subpara10 graph, the term ‘products’ means refrig11 erators, freezers, dehumidifiers, air condi12 tioners, foam insulation, technical aerosols, 

13 fire protection systems, and semiconduc14 tors. 

15 ‘‘(iii) FINANCIAL ASSISTANCE.—The 

16 Administrator may provide financial assist17 ance to manufacturers pursuant to clause 

18 (i) for— 

19 ‘‘(I) the design and configuration 

20 of new products that use alternative 

21 substances with no or low carbon di22 oxide equivalent value and no ozone 

23 depletion potential; and 

24 ‘‘(II) the redesign and retooling 

25 of facilities for the manufacture of 


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1 products in the United States that use 

2 alternative substances with no or low 

3 carbon dioxide equivalent value and 

4 no ozone depletion potential. 

5 ‘‘(iv) REPORTS.—For any fiscal year 

6 during which the Administrator provides 

7 financial assistance pursuant to this sub8 paragraph, the Administrator shall submit 

9 a report to the Congress within 3 months 

10 of the end of such fiscal year detailing the 

11 amounts, recipients, specific purposes, and 

12 results of the financial assistance pro13 vided.’’. 

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

15 title VI of the Clean Air Act (42 U.S.C. 7671 et seq.) 

16 is amended by adding the following new item at the end 

17 thereof: 

‘‘Sec. 619. Hydrofluorocarbons (HFCs).’’. 

18 (c) FIRE SUPPRESSION AGENTS.—Section 605(a) of 

19 the Clean Air Act (42 U.S.C. 7671(a)) is amended— 

20 (1) by striking ‘‘or’’ at the end of paragraph 

21 (2); 

22 (2) by striking the period at the end of para23 graph (3) and inserting ‘‘; or’’; and 

24 (3) by adding the following new paragraph after 

25 paragraph (3): 


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1 ‘‘(4) is listed as acceptable for use as a fire sup2 pression agent for nonresidential applications in ac3 cordance with section 612(c).’’. 

4 (d) MOTOR VEHICLE AIR CONDITIONERS.— 

5 (1) Section 609(e) of the Clean Air Act (42 

6 U.S.C. 7671h(e)) is amended by inserting ‘‘, group 

7 I’’ after each reference to ‘‘class II’’ in the text and 

8 heading. 

9 (2) Section 609 of the Clean Air Act (42 U.S.C. 

10 7671h) is amended by adding the following new sub11 section after subsection (e): 

12 ‘‘(f) CLASS II, GROUP II SUBSTANCES.— 

13 ‘‘(1) REPAIR.—The Administrator may promul14 gate regulations establishing requirements for repair 

15 of motor vehicle air conditioners prior to adding a 

16 class II, group II substance. 

17 ‘‘(2) SMALL CONTAINERS.—(A) The Adminis18 trator may promulgate regulations establishing serv19 icing practices and procedures for recovery of class 

20 II, group II substances from containers which con21 tain less than 20 pounds of such class II, group II 

22 substances. 

23 ‘‘(B) Not later than 18 months after enactment 

24 of this subsection, the Administrator shall either 

25 promulgate regulations requiring that containers 


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1 which contain less than 20 pounds of a class II, 

2 group II substance be equipped with a device or 

3 technology that limits refrigerant emissions and 

4 leaks from the container and limits refrigerant emis5 sions and leaks during the transfer of refrigerant 

6 from the container to the motor vehicle air condi7 tioner or issue a determination that such require8 ments are not necessary or appropriate. 

9 ‘‘(C) Not later than 18 months after enactment 

10 of this subsection, the Administrator shall promul11 gate regulations establishing requirements for con12 sumer education materials on best practices associ13 ated with the use of containers which contain less 

14 than 20 pounds of a class II, group II substance and 

15 prohibiting the sale or distribution, or offer for sale 

16 or distribution, of any class II, group II substance 

17 in any container which contains less than 20 pounds 

18 of such class II, group II substance, unless con19 sumer education materials consistent with such re20 quirements are displayed and available at point-of21 sale locations, provided to the consumer, or included 

22 in or on the packaging of the container which con23 tain less than 20 pounds of a class II, group II sub24 stance. 


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1 ‘‘(D) The Administrator may, through rule2 making, extend the requirements established under 

3 this paragraph to containers which contain 30 

4 pounds or less of a class II, group II substance if 

5 the Administrator determines that such action would 

6 produce significant environmental benefits. 

7 ‘‘(3) RESTRICTION OF SALES.—Effective Janu8 ary 1, 2014, no person may sell or distribute or offer 

9 to sell or distribute or otherwise introduce into inter10 state commerce any motor vehicle air conditioner re11 frigerant in any size container unless the substance 

12 has been found acceptable for use in a motor vehicle 

13 air conditioner under section 612.’’. 

14 (e) SAFE ALTERNATIVES POLICY.—Section 612(e) of 

15 the Clean Air Act (42 U.S.C. 7671k(e)) is amended by 

16 inserting ‘‘or class II’’ after each reference to ‘‘class I’’. 

17 SEC. 123. BLACK CARBON. 

18 (a) STUDY OF BLACK CARBON EMISSIONS.— 

19 (1) DEFINITION OF BLACK CARBON.—In this 

20 subsection, the term ‘‘black carbon’’ means any 

21 light-absorbing graphitic (or elemental) particle pro22 duced by incomplete combustion. 

23 (2) STUDY.—The Administrator, in consulta24 tion with the Secretary of Energy, the Secretary of 

25 State, and the heads of the National Oceanic and 


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1 Atmospheric Administration, the National Aero2 nautics and Space Administration, the United States 

3 Agency for International Development, the National 

4 Institutes of Health, the Centers for Disease Control 

5 and Prevention, National Institute of Standards and 

6 Technology, and other relevant Federal departments 

7 and agencies and representatives of appropriate in8 dustry and environmental groups, shall conduct a 4- 

9 phase study of black carbon emissions, the phases of 

10 which shall be the following: 

11 (A) PHASE I—UNIVERSAL DEFINITION.— 

12 The Administrator shall conduct phase I of the 

13 study under this subsection to carry out meas14 ures to establish for the scientific community 

15 standard definitions of the terms— 

16 (i) black carbon; and 

17 (ii) organic carbon. 

18 (B) PHASE II—SOURCES AND TECH19 NOLOGIES.—The Administrator shall conduct 

20 phase II of the study under this subsection to 

21 summarize the available scientific and technical 

22 information concerning— 

23 (i) the identification of the major 

24 sources of black carbon emissions in the 

25 United States and throughout the world; 


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1 (ii) an estimate of— 

2 (I) the quantity of current and 

3 projected future black carbon emis4 sions from those sources; and 

5 (II) the net climate effects of the 

6 emissions; 

7 (iii) the most recent scientific data 

8 relevant to the public health- and climate9 related impacts of black carbon emissions 

10 and associated emissions of organic car11 bon, nitrogen oxides, and sulfur oxides 

12 from the sources identified under clause 

13 (i); 

14 (iv) the most effective control strate15 gies for additional domestic and inter16 national reductions in black carbon emis17 sions, taking into consideration lifecycle 

18 analysis, cost-effectiveness, and the net cli19 mate impact of technologies, operations, 

20 and strategies, such as— 

21 (I) diesel particulate filters on ex22 isting diesel on- and off-road engines; 

23 and 

24 (II) particulate emission reduc25 tion measures for marine vessels; 


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1 (v) carbon dioxide equivalency factors, 

2 global/regional modeling, or other metrics 

3 to compare the global warming and other 

4 climate effects of black carbon emissions 

5 with carbon dioxide and other greenhouse 

6 gas emissions; and 

7 (vi) the health benefits associated with 

8 additional black carbon emission reduc9 tions. 

10 (C) PHASE III—INTERNATIONAL FUND11 ING.—The Administrator shall conduct phase 

12 III of the study under this subsection— 

13 (i) to summarize the amount, type, 

14 and direction of all actual and potential fi15 nancial, technical, and related assistance 

16 provided by the United States to foreign 

17 countries to reduce, mitigate, or otherwise 

18 abate— 

19 (I) black carbon emissions; and 

20 (II) any health, environmental, 

21 and economic impacts associated with 

22 those emissions; and 

23 (ii) to identify opportunities, including 

24 action under existing authority, to achieve 

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1 tions in foreign countries through the pro2 vision of technical assistance or other ap3 proaches. 

4 (D) PHASE IV—RESEARCH AND DEVELOP5 MENT OPPORTUNITIES.—The Administrator 

6 shall conduct phase IV of the study under this 

7 subsection for the purpose of providing to Con8 gress recommendations regarding— 

9 (i) areas of focus for additional re10 search for cost-effective technologies, oper11 ations, and strategies with the highest po12 tential to reduce black carbon emissions 

13 and protect public health in the United 

14 States and internationally; and 

15 (ii) actions that the Federal Govern16 ment could take to encourage or require 

17 additional black carbon emission reduc18 tions. 

19 (3) REPORTS.—The Administrator shall submit 

20 to Congress— 

21 (A) by not later than 180 days after the 

22 date of enactment of this Act, a report describ23 ing the results of phases I and II of the study 

24 under subparagraphs (A) and (B) of paragraph 

25 (2); 


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1 (B) by not later than 270 days after the 

2 date of enactment of this Act, a report describ3 ing the results of phase III of the study under 

4 paragraph (2)(C); and 

5 (C) by not later than 1 year after the date 

6 of enactment of this Act, a report describing 

7 the recommendations developed for phase IV of 

8 the study under paragraph (2)(D). 

9 (4) AUTHORIZATION OF APPROPRIATIONS.— 

10 There are authorized to be appropriated such sums 

11 as are necessary to carry out this subsection. 

12 (b) BLACK CARBON MITIGATION.—Title VIII of the 

13 Clean Air Act (as amended by section 113 of division A) 

14 is amended by adding at the end the following: 

15 ‘‘PART E—BLACK CARBON 

16 ‘‘SEC. 851. BLACK CARBON. 

17 ‘‘(a) DOMESTIC BLACK CARBON MITIGATION.— 

18 ‘‘(1) IN GENERAL.—Taking into consideration 

19 the public health and environmental impacts of black 

20 carbon emissions, including the effects on global and 

21 regional warming, the Arctic, and other snow and 

22 ice-covered surfaces, the Administrator shall— 

23 ‘‘(A) not later than 2 years after the date 

24 of enactment of this part, propose— 


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1 ‘‘(i) regulations applicable to emis2 sions of black carbon under the existing 

3 authorities of this Act; or 

4 ‘‘(ii) a finding that existing regula5 tions promulgated pursuant to this Act 

6 adequately regulate black carbon emis7 sions, which finding may be based on a 

8 finding that existing regulations, in the 

9 judgment of the Administrator— 

10 ‘‘(I) address those sources that 

11 both contribute significantly to the 

12 total emissions of black carbon and 

13 provide the greatest potential for sig14 nificant and cost-effective reductions 

15 in emissions of black carbon, under 

16 the existing authorities; and 

17 ‘‘(II) reflect the greatest degree 

18 of emission reduction achievable 

19 through application of technology that 

20 will be available for such sources, giv21 ing appropriate consideration to cost, 

22 energy, and safety factors associated 

23 with the application of such tech24 nology; and 


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1 ‘‘(B) not later than 3 years after the date 

2 of enactment of this part, promulgate final reg3 ulations under the existing authorities of this 

4 Act or finalize the proposed finding. 

5 ‘‘(2) APPLICABILITY OF REGULATIONS.—Regu6 lations promulgated under paragraph (1) shall not 

7 apply to specific types, classes, categories, or other 

8 suitable groupings of emission sources that the Ad9 ministrator finds are subject to adequate regulation. 

10 ‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There 

11 are authorized to be appropriated such sums as are nec12 essary to carry out this section.’’. 

13 SEC. 124. STATES. 

14 Section 116 of the Clean Air Act (42 U.S.C. 7416) 

15 is amended by adding the following at the end thereof: 

16 ‘‘For the purposes of this section, the phrases ‘standard 

17 or limitation respecting emissions of air pollutants’ and 

18 ‘requirements respecting control or abatement of air pollu19 tion’ shall include any provision to: limit greenhouse gas 

20 emissions, require surrender to the State or a political 

21 subdivision thereof of emission allowances or offset credits 

22 established or issued under this Act, and require the use 

23 of such allowances or credits as a means of demonstrating 

24 compliance with requirements established by a State or 

25 political subdivision thereof.’’. 


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1 SEC. 125. STATE PROGRAMS. 

2 Title VIII of the Clean Air Act (as amended by sec3 tion 123(b)) is amended by adding at the end the fol4 lowing: 

5 ‘‘PART F—MISCELLANEOUS 

6 ‘‘SEC. 861. STATE PROGRAMS. 

7 ‘‘(a) IN GENERAL.—Notwithstanding section 116, if 

8 a Federal auction is conducted, by the deadline of March 

9 31, 2011, as established in section 778, no State or polit10 ical subdivision thereof shall implement or enforce a com11 prehensive greenhouse gas emission limitation program 

12 that covers any capped emissions emitted during the years 

13 2012 through 2017. 

14 ‘‘(b) DEADLINE.—Notwithstanding section 116, in 

15 the event the March 31, 2011 auction is delayed, no State 

16 or political subdivision thereof shall enforce a comprehen17 sive greenhouse gas emission limitation program that cov18 ers any capped emissions emitted during the period that 

19 is at least 9 months from the first auction as set out in 

20 section 778, through 2017. 

21 ‘‘(c) DEFINITION OF COMPREHENSIVE GREENHOUSE

22 GAS EMISSION LIMITATION PROGRAM.—For purposes of 

23 this section, the term ‘comprehensive greenhouse gas 

24 emission limitation program’ means a system of green25 house gas regulation under which a State or political sub26 division issues a limited number of tradable instruments 


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1 in the nature of emission allowances and requires that 

2 sources within its jurisdiction surrender such tradeable in3 struments for each unit of greenhouse gases emitted dur4 ing a compliance period. For purposes of this section, a 

5 ‘comprehensive greenhouse gas emission limitation pro6 gram’ does not include a target or limit on greenhouse 

7 gas emissions adopted by a State or political subdivision 

8 that is implemented other than through the issuance and 

9 surrender of a limited number of tradable instruments in 

10 the nature of emission allowances, nor does it include any 

11 other standard, limit, regulation, or program to reduce 

12 greenhouse gas emissions that is not implemented through 

13 the issuance and surrender of a limited number of 

14 tradeable instruments in the nature of emission allow15 ances. For purposes of this section, the term ‘comprehen16 sive greenhouse gas emission limitation program’ does not 

17 include, among other things, fleet-wide motor vehicle emis18 sion requirements that allow greater emissions with in19 creased vehicle production, or requirements that fuels, or 

20 other products, meet an average pollution emission rate 

21 or lifecycle greenhouse gas standard. 

22 ‘‘SEC. 862. GRANTS FOR SUPPORT OF AIR POLLUTION CON23 TROL PROGRAMS. 

24 ‘‘The Administrator is authorized to make grants to 

25 air pollution control agencies pursuant to section 105 for 


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1 purposes of assisting in the implementation of programs 

2 to address global warming established under the Clean 

3 Energy Jobs and American Power Act.’’. 

4 SEC. 126. ENFORCEMENT. 

5 (a) REMAND.—Section 307(b) of the Clean Air Act 

6 (42 U.S.C. 7607(b)) is amended by adding the following 

7 new paragraph at the end thereof: 

8 ‘‘(3) If the court determines that any action of 

9 the Administrator is arbitrary, capricious, or other10 wise unlawful, the court may remand such action, 

11 without vacatur, if vacatur would impair or delay 

12 protection of the environment or public health or 

13 otherwise undermine the timely achievement of the 

14 purposes of this Act. 

15 ‘‘(4) If the court determines that any action of 

16 the Administrator is arbitrary, capricious, or other17 wise unlawful, and remands the matter to the Ad18 ministrator, the Administrator shall complete final 

19 action on remand within an expeditious time period 

20 not longer than the time originally allowed for the 

21 action or 1 year, whichever is less, unless the court 

22 on motion determines that a shorter or longer period 

23 is necessary, appropriate, and consistent with the 

24 purposes of this Act. The court of appeals shall have 


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1 jurisdiction to enforce a deadline for action on re2 mand under this paragraph.’’. 

3 (b) PETITION FOR RECONSIDERATION.—Section 

4 307(d)(7)(B) of the Clean Air Act (42 U.S.C. 

5 7607(d)(7)(B)) is amended as follows: 

6 (1) By inserting after the second sentence ‘‘If 

7 a petition for reconsideration is filed, the Adminis8 trator shall take final action on such petition, in9 cluding promulgation of final action either revising 

10 or determining not to revise the action for which re11 consideration is sought, within 150 days after the 

12 petition is received by the Administrator or the peti13 tion shall be deemed denied for the purpose of judi14 cial review.’’. 

15 (2) By amending the third sentence to read as 

16 follows: ‘‘Such person may seek judicial review of 

17 such denial, or of any other final action, by the Ad18 ministrator, in response to a petition for reconsider19 ation, in the United States court of appeals for the 

20 appropriate circuit (as provided in subsection (b)).’’. 

21 (c) PETITION FOR REVIEW.—Section 307(b)(1) of 

22 the Clean Air Act (42 U.S.C. 7607(b)(1)) is amended by 

23 inserting after the second sentence the following: ‘‘Any 

24 person may file a petition for review of action by the Ad25 ministrator as provided in this subsection.’’. 


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1 SEC. 127. CONFORMING AMENDMENTS. 

2 (a) FEDERAL ENFORCEMENT.—Section 113 of the 

3 Clean Air Act (42 U.S.C. 7413) is amended as follows: 

4 (1) In subsection (a)(3), by striking ‘‘or title 

5 VI,’’ and inserting ‘‘title VI, title VII, or title VIII’’. 

6 (2) In subsection (b), by striking ‘‘or a major 

7 stationary source’’ and inserting ‘‘a major stationary 

8 source, or a covered EGU under title VIII’’ in the 

9 material preceding paragraph (1). 

10 (3) In paragraph (2) of subsection (b), by strik11 ing ‘‘or title VI’’ and inserting ‘‘title VI, title VII, 

12 or title VIII’’. 

13 (4) In subsection (c)— 

14 (A) in the first sentence of paragraph (1), 

15 by striking ‘‘or title VI (relating to strato16 spheric ozone control),’’ and inserting ‘‘title VI, 

17 title VII, or title VIII,’’; and 

18 (B) in the first sentence of paragraph (3), 

19 by striking ‘‘or VI’’ and inserting ‘‘VI, VII, or 

20 VIII’’. 

21 (5) In subsection (d)(1)(B), by striking ‘‘or VI’’ 

22 and inserting ‘‘VI, VII, or VIII’’. 

23 (6) In subsection (f), in the first sentence, by 

24 striking ‘‘or VI’’ and inserting ‘‘VI, VII, or VIII’’. 


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1 (b) RETENTION OF STATE AUTHORITY.—Section 

2 116 of the Clean Air Act (42 U.S.C. 7416) is amended 

3 as follows: 

4 (1) By striking ‘‘and 233’’ and inserting ‘‘233’’. 

5 (2) By striking ‘‘of moving sources)’’ and in6 serting ‘‘of moving sources), and 861 (preempting 

7 certain State greenhouse gas programs for a limited 

8 time)’’. 

9 (c) INSPECTIONS, MONITORING, AND ENTRY.—Sec10 tion 114(a) of the Clean Air Act (42 U.S.C. 7414(a)) is 

11 amended by striking ‘‘section 112,’’ and all that follows 

12 through ‘‘(ii)’’ and inserting the following: ‘‘section 112, 

13 or any regulation of greenhouse gas emissions under title 

14 VII or VIII, (ii)’’. 

15 (d) ENFORCEMENT.—Subsection (f) of section 304 of 

16 the Clean Air Act (42 U.S.C. 7604(f)) is amended as fol17 lows: 

18 (1) By striking ‘‘; or’’ at the end of paragraph 

19 (3) thereof and inserting a comma. 

20 (2) By striking the period at the end of para21 graph (4) thereof and inserting ‘‘, or’’. 

22 (3) By adding the following after paragraph (4) 

23 thereof: 

24 ‘‘(5) any requirement of title VII or VIII.’’. 


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1 (e) ADMINISTRATIVE PROCEEDINGS AND JUDICIAL

2 REVIEW.—Section 307 of the Clean Air Act (42 U.S.C. 

3 7607) is amended as follows: 

4 (1) In subsection (a), by striking ‘‘, or section 

5 306’’ and inserting ‘‘section 306, or title VII or 

6 VIII’’. 

7 (2) In subsection (b)(1)— 

8 (A) by striking ‘‘,,’’ and inserting ‘‘,’’ in 

9 each place such punctuation appears; and 

10 (B) by striking ‘‘section 120,’’ in the first 

11 sentence and inserting ‘‘section 120, any final 

12 action under title VII or VIII,’’. 

13 (3) In subsection (d)(1) by amending subpara14 graph (S) to read as follows: 

15 ‘‘(S) the promulgation or revision of any 

16 regulation under title VII or VIII,’’. 

17 (f) TECHNICAL AMENDMENT.—Title IV of the Clean 

18 Air Act (relating to noise pollution) (42 U.S.C. 7641 et 

19 seq.)— 

20 (1) is amended by redesignating sections 401 

21 through 403 as sections 901 through 903, respec22 tively; and 

23 (2) is redesignated as title IX and moved to ap24 pear at the end of that Act. 


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1 SEC. 128. DAVIS-BACON COMPLIANCE. 

2 (a) IN GENERAL.—Notwithstanding any other provi3 sion of law and in a manner consistent with other provi4 sions in this Act, to receive emission allowances or funding 

5 under this Act, or the amendments made by this Act, the 

6 recipient shall provide reasonable assurances that all la7 borers and mechanics employed by contractors and sub8 contractors on projects funded directly by or assisted in 

9 whole or in part by and through the Federal Government 

10 pursuant to this Act, or the amendments made by this 

11 Act, or by any entity established in accordance with this 

12 Act, or the amendments made by this Act, including the 

13 Carbon Storage Research Corporation, will be paid wages 

14 at rates not less than those prevailing on projects of a 

15 character similar in the locality as determined by the Sec16 retary of Labor in accordance with subchapter IV of chap17 ter 31 of title 40, United States Code (commonly known 

18 as the ‘‘Davis-Bacon Act’’). With respect to the labor 

19 standards specified in this section, the Secretary of Labor 

20 shall have the authority and functions set forth in Reorga21 nization Plan Numbered 14 of 1950 (64 Stat. 1267; 5 

22 U.S.C. App.) and section 3145 of title 40, United States 

23 Code. 

24 (b) EXEMPTION.—Neither subsection (a) nor the re25 quirements of subchapter IV of chapter 31 of title 40, 


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1 United States Code, shall apply to retrofitting of the fol2 lowing: 

3 (1) Single family homes (both attached and de4 tached) under section 164 of division A. 

5 (2) Owner-occupied residential units in larger 

6 buildings that have their own dedicated space-condi7 tioning systems under section 164 of division A. 

8 (3) Residential buildings (as defined in section 

9 164(a) of division A) if designed for residential use 

10 by less than 4 families. 

11 (4) Nonresidential buildings (as defined in sec12 tion 164(a) of division A) if the net interior space 

13 of such nonresidential building is less than 6,500 

14 square feet. 

15 Subtitle D—Carbon Market 

16 Assurance 

17 SEC. 131. CARBON MARKET ASSURANCE. 

18 It is the sense of the Senate that there shall be a 

19 single, integrated carbon market oversight program— 

20 (1) to provide for effective and comprehensive 

21 market oversight and enforcement; 

22 (2) to lower systemic risk and protect con23 sumers; 

24 (3) to ensure market liquidity and allowance 

25 availability; 


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1 (4) to enhance the price discovery function of 

2 such markets, ensuring that the price for emission 

3 allowances and offset credits reflects the marginal 

4 cost of abatement; 

5 (5) to prevent excessive speculation that con6 tributes to price volatility, including the establish7 ment of robust aggregate position limits and margin 

8 requirements; 

9 (6) to ensure that market mechanisms and as10 sociated oversight support the environmental integ11 rity of the program established under title VII of the 

12 Clean Air Act (as added by section 101 of this divi13 sion); 

14 (7) to establish provisions for market trans15 parency that provide authority, resources, and infor16 mation needed to prevent fraud and manipulation in 

17 such markets; 

18 (8) to establish standards for trading as, and 

19 operation of, trading facilities; 

20 (9) to ensure a well-functioning, well-regulated 

21 market, including a futures market, designed to 

22 manage risk and facilitate investment in emission re23 ductions; 

24 (10) to establish clear, professional standards 

25 for dealers, traders, and other market participants; 


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1 (11) to provide for appropriate criminal and 

2 civil penalties; and 

3 (12) to prevent any excessive leverage by mar4 ket participants that creates risk to the economy. 

5 Subtitle E—Ensuring Real 

6 Reductions in Industrial Emissions 

7 SEC. 141. ENSURING REAL REDUCTIONS IN INDUSTRIAL 

8 EMISSIONS. 

9 Title VII of the Clean Air Act (as amended by section 

10 322 of division A) is amended by adding at the end the 

11 following: 

12 ‘‘PART F—ENSURING REAL REDUCTIONS IN 

13 INDUSTRIAL EMISSIONS 

14 ‘‘SEC. 761. PURPOSES. 

15 ‘‘The purposes of this part are— 

16 ‘‘(1) to promote a strong global effort to signifi17 cantly reduce greenhouse gas emissions, and, 

18 through this global effort, stabilize greenhouse gas 

19 concentrations in the atmosphere at a level that will 

20 prevent dangerous anthropogenic interference with 

21 the climate system; 

22 ‘‘(2) to prevent an increase in greenhouse gas 

23 emissions in countries other than the United States 

24 as a result of direct and indirect compliance costs in25 curred under this title; 


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1 ‘‘(3) to provide a rebate to the owners and op2 erators of entities in domestic eligible industrial sec3 tors for their greenhouse gas emission costs incurred 

4 under this title, but not for costs associated with 

5 other related or unrelated market dynamics; 

6 ‘‘(4) to design such rebates in a way that will 

7 prevent carbon leakage while also rewarding innova8 tion and facility-level investments in energy effi9 ciency performance improvements; and 

10 ‘‘(5) to eliminate or reduce distribution of emis11 sion allowances under this part when such distribu12 tion is no longer necessary to prevent carbon leakage 

13 from eligible industrial sectors. 

14 ‘‘SEC. 762. DEFINITIONS. 

15 ‘‘In this part: 

16 ‘‘(1) CARBON LEAKAGE.—The term ‘carbon 

17 leakage’ means any substantial increase (as deter18 mined by the Administrator) in greenhouse gas 

19 emissions by industrial entities located in other 

20 countries if such increase is caused by an incre21 mental cost of production increase in the United 

22 States resulting from the implementation of this 

23 title. 

24 ‘‘(2) ELIGIBLE INDUSTRIAL SECTOR.—The 

25 term ‘eligible industrial sector’ means an industrial 


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1 sector determined by the Administrator under sec2 tion 763(b) to be eligible to receive emission allow3 ance rebates under this part. 

4 ‘‘(3) INDUSTRIAL SECTOR.—The term ‘indus5 trial sector’ means any sector that is in the manu6 facturing sector (as defined in NAICS codes 31, 32, 

7 and 33) or that beneficiates or otherwise processes 

8 (including agglomeration) metal ores, including iron 

9 and copper ores, soda ash, or phosphate. The extrac10 tion of metal ores, soda ash, or phosphate shall not 

11 be considered to be an industrial sector. 

12 ‘‘(4) NAICS.—The term ‘NAICS’ means the 

13 North American Industrial Classification System of 

14 2002. 

15 ‘‘(5) OUTPUT.—The term ‘output’ means the 

16 total tonnage or other standard unit of production 

17 (as determined by the Administrator) produced by 

18 an entity in an industrial sector. The output of the 

19 cement sector is hydraulic cement, and not clinker. 

20 ‘‘SEC. 763. ELIGIBLE INDUSTRIAL SECTORS. 

21 ‘‘(a) LIST.— 

22 ‘‘(1) INITIAL LIST.—Not later than June 30, 

23 2011, the Administrator shall publish in the Federal 

24 Register a list of eligible industrial sectors pursuant 

25 to subsection (b). Such list shall include the amount 


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1 of the emission allowance rebate per unit of produc2 tion that shall be provided to entities in each eligible 

3 industrial sector in the following two calendar years 

4 pursuant to section 764. 

5 ‘‘(2) SUBSEQUENT LISTS.—Not later than Feb6 ruary 1, 2013, and every 4 years thereafter, the Ad7 ministrator shall publish in the Federal Register an 

8 updated version of the list published under para9 graph (1). 

10 ‘‘(b) ELIGIBLE INDUSTRIAL SECTORS.— 

11 ‘‘(1) IN GENERAL.—Not later than June 30, 

12 2011, the Administrator shall promulgate a rule des13 ignating, based on the criteria under paragraph (2), 

14 the industrial sectors eligible for emission allowance 

15 rebates under this part. 

16 ‘‘(2) PRESUMPTIVELY ELIGIBLE INDUSTRIAL

17 SECTORS.— 

18 ‘‘(A) ELIGIBILITY CRITERIA.— 

19 ‘‘(i) IN GENERAL.—An owner or oper20 ator of an entity shall be eligible to receive 

21 emission allowance rebates under this part 

22 if such entity is in an industrial sector that 

23 is included in a six-digit classification of 

24 the NAICS that meets the criteria in both 


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1 clauses (ii) and (iii), or the criteria in 

2 clause (iv). 

3 ‘‘(ii) ENERGY OR GREENHOUSE GAS

4 INTENSITY.—As determined by the Admin5 istrator, the industrial sector had— 

6 ‘‘(I) an energy intensity of at 

7 least 5 percent, calculated by dividing 

8 the cost of purchased electricity and 

9 fuel costs of the sector by the value of 

10 the shipments of the sector, based on 

11 data described in subparagraph (D); 

12 or 

13 ‘‘(II) a greenhouse gas intensity 

14 of at least 5 percent, calculated by di15 viding— 

16 ‘‘(aa) the number 20 multi17 plied by the number of tons of 

18 carbon dioxide equivalent green19 house gas emissions (including 

20 direct emissions from fuel com21 bustion, process emissions, and 

22 indirect emissions from the gen23 eration of electricity used to 

24 produce the output of the sector) 


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1 of the sector based on data de2 scribed in subparagraph (D); by 

3 ‘‘(bb) the value of the ship4 ments of the sector, based on 

5 data described in subparagraph 

6 (D). 

7 ‘‘(iii) TRADE INTENSITY.—As deter8 mined by the Administrator, the industrial 

9 sector had a trade intensity of at least 15 

10 percent, calculated by dividing the value of 

11 the total imports and exports of such sec12 tor by the value of the shipments plus the 

13 value of imports of such sector, based on 

14 data described in subparagraph (D). 

15 ‘‘(iv) VERY HIGH ENERGY OR GREEN16 HOUSE GAS INTENSITY.—As determined by 

17 the Administrator, the industrial sector 

18 had an energy or greenhouse gas intensity, 

19 as calculated under clause (ii)(I) or (II), of 

20 at least 20 percent. 

21 ‘‘(B) METAL AND PHOSPHATE PRODUC22 TION CLASSIFIED UNDER MORE THAN ONE

23 NAICS CODE.—For purposes of this section, the 

24 Administrator shall— 


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1 ‘‘(i) aggregate data for the 

2 beneficiation or other processing (including 

3 agglomeration) of metal ores, including 

4 iron and copper ores, soda ash, or phos5 phate with subsequent steps in the process 

6 of metal and phosphate manufacturing, re7 gardless of the NAICS code under which 

8 such activity is classified; and 

9 ‘‘(ii) aggregate data for the manufac10 turing of steel with the manufacturing of 

11 steel pipe and tube made from purchased 

12 steel in a nonintegrated process. 

13 ‘‘(C) EXCLUSION.—The petroleum refining 

14 sector shall not be an eligible industrial sector. 

15 ‘‘(D) DATA SOURCES.— 

16 ‘‘(i) ELECTRICITY AND FUEL COSTS, 

17 VALUE OF SHIPMENTS.—The Adminis18 trator shall determine electricity and fuel 

19 costs and the value of shipments under 

20 this subsection from data from the United 

21 States Census Annual Survey of Manufac22 turers. The Administrator shall take the 

23 average of data from as many of the years 

24 of 2004, 2005, and 2006 for which such 

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1 available, the Administrator shall make a 

2 determination based upon 2002 or 2006 

3 data from the most detailed industrial clas4 sification level of Energy Information 

5 Agency’s Manufacturing Energy Consump6 tion Survey (using 2006 data if it is avail7 able) and the 2002 or 2007 Economic Cen8 sus of the United States (using 2007 data 

9 if it is available). If data from the Manu10 facturing Energy Consumption Survey or 

11 Economic Census are unavailable for any 

12 sector at the six-digit classification level in 

13 the NAICS, then the Administrator may 

14 extrapolate the information necessary to 

15 determine the eligibility of a sector under 

16 this paragraph from available Manufac17 turing Energy Consumption Survey or 

18 Economic Census data pertaining to a 

19 broader industrial category classified in the 

20 NAICS. If data relating to the 

21 beneficiation or other processing (including 

22 agglomeration) of metal ores, including 

23 iron and copper ores, soda ash, or phos24 phate are not available from the specified 

25 data sources, the Administrator shall use 


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1 the best available Federal or State govern2 ment data and may use, to the extent nec3 essary, representative data submitted by 

4 entities that perform such beneficiation or 

5 other processing (including agglomeration), 

6 in making a determination. Fuel cost data 

7 shall not include the cost of fuel used as 

8 feedstock by an industrial sector. 

9 ‘‘(ii) IMPORTS AND EXPORTS.—The 

10 Administrator shall base the value of im11 ports and exports under this subsection on 

12 United States International Trade Com13 mission data. The Administrator shall take 

14 the average of data from as many of the 

15 years of 2004, 2005, and 2006 for which 

16 such data are available. If data from the 

17 United States International Trade Com18 mission are unavailable for any sector at 

19 the six-digit classification level in the 

20 NAICS, then the Administrator may ex21 trapolate the information necessary to de22 termine the eligibility of a sector under 

23 this paragraph from available United 

24 States International Trade Commission 


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1 data pertaining to a broader industrial cat2 egory classified in the NAICS. 

3 ‘‘(iii) PERCENTAGES.—The Adminis4 trator shall round the energy intensity, 

5 greenhouse gas intensity, and trade inten6 sity percentages under subparagraph (A) 

7 to the nearest whole number. 

8 ‘‘(iv) GREENHOUSE GAS EMISSION

9 CALCULATIONS.—When calculating the 

10 tons of carbon dioxide equivalent green11 house gas emissions for each sector under 

12 subparagraph (A)(ii)(II)(aa), the Adminis13 trator— 

14 ‘‘(I) shall use the best available 

15 data from as many of the years 2004, 

16 2005, and 2006 for which such data 

17 is available; and 

18 ‘‘(II) may, to the extent nec19 essary with respect to a sector, use 

20 economic and engineering models and 

21 the best available information on tech22 nology performance levels for such 

23 sector. 

24 ‘‘(3) ADMINISTRATIVE DETERMINATION OF AD25 DITIONAL ELIGIBLE INDUSTRIAL SECTORS.— 


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1 ‘‘(A) UPDATED TRADE INTENSITY DATA.— 

2 The Administrator shall designate as eligible to 

3 receive emission allowance rebates under this 

4 part an industrial sector that— 

5 ‘‘(i) met the energy or greenhouse gas 

6 intensity criteria in paragraph (2)(A)(ii) as 

7 of the date of promulgation of the rule 

8 under paragraph (1); and 

9 ‘‘(ii) meets the trade intensity criteria 

10 in paragraph (2)(A)(iii), using data from 

11 any year after 2006. 

12 ‘‘(B) INDIVIDUAL SHOWING PETITION.— 

13 ‘‘(i) PETITION.—In addition to des14 ignation under paragraph (2) or subpara15 graph (A) of this paragraph, the owner or 

16 operator of an entity in an industrial sec17 tor may petition the Administrator to des18 ignate as eligible industrial sectors under 

19 this part an entity or a group of entities 

20 that— 

21 ‘‘(I) represent a subsector of a 

22 six-digit section of the NAICS code; 

23 and 

24 ‘‘(II) meet the eligibility criteria 

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1 graph (2)(A), or the eligibility criteria 

2 in clause (iv) of paragraph (2)(A). 

3 ‘‘(ii) DATA.—In making a determina4 tion under this subparagraph, the Admin5 istrator shall consider data submitted by 

6 the petitioner that is specific to the entity, 

7 data solicited by the Administrator from 

8 other entities in the subsector, if such 

9 other entities exist, and data specified in 

10 paragraph (2)(D). 

11 ‘‘(iii) BASIS OF SUBSECTOR DETER12 MINATION.—The Administrator shall de13 termine an entity or group of entities to be 

14 a subsector of a six-digit section of the 

15 NAICS code based only upon the products 

16 manufactured and not the industrial proc17 ess by which the products are manufac18 tured, except that the Administrator may 

19 determine an entity or group of entities 

20 that manufacture a product from primarily 

21 virgin material to be a separate subsector 

22 from another entity or group of entities 

23 that manufacture the same product pri24 marily from recycled material. 


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1 ‘‘(iv) USE OF MOST RECENT DATA.— 

2 In determining whether to designate a sec3 tor or subsector as an eligible industrial 

4 sector under this subparagraph, the Ad5 ministrator shall use the most recent data 

6 available from the sources described in 

7 paragraph (2)(D), rather than the data 

8 from the years specified in paragraph 

9 (2)(D), to determine the trade intensity of 

10 such sector or subsector, but only for de11 termining such trade intensity. 

12 ‘‘(v) FINAL ACTION.—The Adminis13 trator shall take final action on such peti14 tion no later than 6 months after the peti15 tion is received by the Administrator. 

16 ‘‘SEC. 764. DISTRIBUTION OF EMISSION ALLOWANCE RE17 BATES. 

18 ‘‘(a) DISTRIBUTION SCHEDULE.— 

19 ‘‘(1) IN GENERAL.—For each vintage year, the 

20 Administrator shall distribute pursuant to this sec21 tion emission allowances made available under sec22 tion 771(a)(5), no later than October 31 of the pre23 ceding calendar year. The Administrator shall make 

24 such annual distributions to the owners and opera25 tors of each entity in an eligible industrial sector in 


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1 the amount of emission allowances calculated under 

2 subsection (b), except that— 

3 ‘‘(A) for vintage years 2012 and 2013, the 

4 distribution for a covered entity shall be pursu5 ant to the entity’s indirect carbon factor as cal6 culated under subsection (b)(3); 

7 ‘‘(B) for vintage year 2026 and thereafter, 

8 the distribution shall be pursuant to the 

9 amount calculated under subsection (b) multi10 plied by, for a sector— 

11 ‘‘(i) 90 percent for vintage year 2026; 

12 ‘‘(ii) 80 percent for vintage year 

13 2027; 

14 ‘‘(iii) 70 percent for vintage year 

15 2028; 

16 ‘‘(iv) 60 percent for vintage year 

17 2029; 

18 ‘‘(v) 50 percent for vintage year 2030; 

19 ‘‘(vi) 40 percent for vintage year 

20 2031; 

21 ‘‘(vii) 30 percent for vintage year 

22 2032; 

23 ‘‘(viii) 20 percent for vintage year 

24 2033; 


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1 ‘‘(ix) 10 percent for vintage year 

2 2034; and 

3 ‘‘(x) 0 percent for vintage year 2035 

4 and thereafter. 

5 ‘‘(2) NEWLY ELIGIBLE SECTORS.—In addition 

6 to receiving a distribution of emission allowances 

7 under this section in the first distribution occurring 

8 after an industrial sector is designated as eligible 

9 under section 763(b)(3), the owner or operator of an 

10 entity in that eligible industrial sector may receive a 

11 prorated share of any emission allowances made 

12 available for distribution under this section that 

13 were not distributed for the year in which the peti14 tion for eligibility was granted under section 

15 763(b)(3)(A). 

16 ‘‘(3) CESSATION OF QUALIFYING ACTIVITIES.— 

17 If, as determined by the Administrator, a facility is 

18 no longer in an eligible industrial sector designated 

19 under section 763— 

20 ‘‘(A) the Administrator shall not distribute 

21 emission allowances to the owner or operator of 

22 such facility under this section; and 

23 ‘‘(B) the owner or operator of such facility 

24 shall return to the Administrator all allowances 

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1 tage years and a pro-rated amount of allow2 ances distributed to the facility under this sec3 tion for the vintage year in which the facility 

4 ceases to be in an eligible industrial sector des5 ignated under section 763. 

6 ‘‘(b) CALCULATION OF DIRECT AND INDIRECT CAR7 BON FACTORS.— 

8 ‘‘(1) IN GENERAL.— 

9 ‘‘(A) COVERED ENTITIES.—Except as pro10 vided in subsection (a), for covered entities that 

11 are in eligible industrial sectors, the amount of 

12 emission allowance rebates shall be based on 

13 the sum of the covered entity’s direct and indi14 rect carbon factors. 

15 ‘‘(B) OTHER ELIGIBLE ENTITIES.—For 

16 entities that are in eligible industrial sectors 

17 but are not covered entities, the amount of 

18 emission allowance rebates shall be based on 

19 the entity’s indirect carbon factor. 

20 ‘‘(C) NEW ENTITIES.—Not later than 2 

21 years after the date of enactment of this title, 

22 the Administrator shall issue regulations gov23 erning the distribution of emission allowance re24 bates for the first and second years of operation 


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1 of a new entity in an eligible industrial sector. 

2 These regulations shall provide for— 

3 ‘‘(i) the distribution of emission allow4 ance rebates to such entities based on com5 parable entities in the same sector; and 

6 ‘‘(ii) an adjustment in the third and 

7 fourth years of operation to reconcile the 

8 total amount of emission allowance rebates 

9 received during the first and second years 

10 of operation to the amount the entity 

11 would have received during the first and 

12 second years of operation had the appro13 priate data been available. 

14 ‘‘(2) DIRECT CARBON FACTOR.—The direct car15 bon factor for a covered entity for a vintage year is 

16 the product of— 

17 ‘‘(A) the average annual output of the cov18 ered entity for the 2 years preceding the year 

19 of the distribution; and 

20 ‘‘(B) the most recent calculation of the av21 erage direct greenhouse gas emissions (ex22 pressed in tons of carbon dioxide equivalent) 

23 per unit of output for all covered entities in the 

24 sector, as determined by the Administrator 

25 under paragraph (4). 


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1 ‘‘(3) INDIRECT CARBON FACTOR.— 

2 ‘‘(A) IN GENERAL.—The indirect carbon 

3 factor for an entity for a vintage year is the 

4 product obtained by multiplying the average an5 nual output of the entity for the 2 years pre6 ceding the year of the distribution by both the 

7 electricity emissions intensity factor determined 

8 pursuant to subparagraph (B) and the elec9 tricity efficiency factor determined pursuant to 

10 subparagraph (C) for the year concerned. 

11 ‘‘(B) ELECTRICITY EMISSIONS INTENSITY

12 FACTOR.— 

13 ‘‘(i) IN GENERAL.—Each person sell14 ing electricity to the owner or operator of 

15 an entity in any sector designated as an el16 igible industrial sector under section 

17 763(b) shall provide the owner or operator 

18 of the entity and the Administrator, on an 

19 annual basis, the electricity emissions in20 tensity factor for the entity. The electricity 

21 emissions intensity factor for the entity, 

22 expressed in tons of carbon dioxide equiva23 lents per kilowatt hour, is determined by 

24 dividing— 


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1 ‘‘(I) the annual sum of the hour2 ly product of— 

3 ‘‘(aa) the electricity pur4 chased by the entity from that 

5 person in each hour (expressed in 

6 kilowatt hours); multiplied by 

7 ‘‘(bb) the marginal or 

8 weighted average tons of carbon 

9 dioxide equivalent per kilowatt 

10 hour that are reflected in the 

11 electricity charges to the entity, 

12 as determined by the entity’s re13 tail rate arrangements; by 

14 ‘‘(II) the total kilowatt hours of 

15 electricity purchased by the entity 

16 from that person during that year. 

17 ‘‘(ii) USE OF OTHER DATA TO DETER18 MINE FACTOR.—Where it is not possible to 

19 determine the precise electricity emissions 

20 intensity factor for an entity using the 

21 methodology in clause (i), the person sell22 ing electricity shall use the monthly aver23 age data reported by the Energy Informa24 tion Administration or collected and re25 ported by the Administrator for the utility 


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1 serving the entity to determine the elec2 tricity emissions intensity factor. 

3 ‘‘(C) ELECTRICITY EFFICIENCY FACTOR.— 

4 The electricity efficiency factor is the average 

5 amount of electricity (in kilowatt hours) used 

6 per unit of output for all entities in the relevant 

7 sector, as determined by the Administrator 

8 based on the best available data, including data 

9 provided under paragraph (6). 

10 ‘‘(D) INDIRECT CARBON FACTOR REDUC11 TION.—If an electricity provider received a free 

12 allocation of emission allowances pursuant to 

13 section 771(a)(1), the Administrator shall ad14 just the indirect carbon factor to avoid rebates 

15 to the eligible entity for costs that the Adminis16 trator determines were not incurred by the eli17 gible entity because the allowances were freely 

18 allocated to the eligible entity’s electricity pro19 vider and used for the benefit of industrial con20 sumers. 

21 ‘‘(4) GREENHOUSE GAS INTENSITY CALCULA22 TIONS.—The Administrator shall calculate the aver23 age direct greenhouse gas emissions (expressed in 

24 tons of carbon dioxide equivalent) per unit of output 

25 and the electricity efficiency factor for all covered 


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1 entities in each eligible industrial sector every 4 

2 years, using an average of the four most recent 

3 years of the best available data. For purposes of the 

4 lists required to be published no later than February 

5 1, 2013, the Administrator shall use the best avail6 able data for the maximum number of years, up to 

7 4 years, for which data are available. 

8 ‘‘(5) ENSURING EFFICIENCY IMPROVEMENTS.— 

9 When making greenhouse gas calculations, the Ad10 ministrator shall— 

11 ‘‘(A) limit the average direct greenhouse 

12 gas emissions per unit of output, calculated 

13 under paragraph (4), for any eligible industrial 

14 sector to an amount that is not greater than it 

15 was in any previous calculation under this sub16 section; 

17 ‘‘(B) limit the electricity emissions inten18 sity factor, calculated under paragraph (3)(B) 

19 and resulting from a change in electricity sup20 ply, for any entity to an amount that is not 

21 greater than it was during any previous year; 

22 and 

23 ‘‘(C) limit the electricity efficiency factor, 

24 calculated under paragraph (3)(C), for any eli25 gible industrial sector to an amount that is not 


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1 greater than it was in any previous calculation 

2 under this subsection. 

3 ‘‘(6) DATA SOURCES.—For the purposes of this 

4 subsection— 

5 ‘‘(A) the Administrator shall use data from 

6 the greenhouse gas registry established under 

7 section 713, where it is available; and 

8 ‘‘(B) each owner or operator of an entity 

9 in an eligible industrial sector and each depart10 ment, agency, and instrumentality of the 

11 United States shall provide the Administrator 

12 with such information as the Administrator 

13 finds necessary to determine the direct carbon 

14 factor and the indirect carbon factor for each 

15 entity subject to this section. 

16 ‘‘(c) TOTAL MAXIMUM DISTRIBUTION.—Notwith17 standing subsections (a) and (b), the Administrator shall 

18 not distribute more allowances for any vintage year pursu19 ant to this section than are allocated for use under this 

20 part pursuant to section 765 for that vintage year. For 

21 any vintage year for which the total emission allowance 

22 rebates calculated pursuant to this section exceed the 

23 number of allowances allocated pursuant to section 765, 

24 the Administrator shall reduce each entity’s distribution 

25 on a pro rata basis so that the total distribution under 


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1 this section equals the number of allowances allocated 

2 under section 765. 

3 ‘‘(d) IRON AND STEEL SECTOR.—For purposes of 

4 this section, the Administrator shall consider as in dif5 ferent industrial sectors— 

6 ‘‘(1) entities using integrated iron and 

7 steelmaking technologies (including coke ovens, blast 

8 furnaces, and other iron-making technologies); and 

9 ‘‘(2) entities using electric arc furnace tech10 nologies. 

11 ‘‘(e) METAL, SODA ASH, OR PHOSPHATE PRODUC12 TION CLASSIFIED UNDER MORE THAN ONE NAICS

13 CODE.—For purposes of this section, the Administrator 

14 shall not aggregate data for the beneficiation or other 

15 processing (including agglomeration) of metal ores, soda 

16 ash, or phosphate with subsequent steps in the process 

17 of metal, soda ash, or phosphate manufacturing. The Ad18 ministrator shall consider the beneficiation or other proc19 essing (including agglomeration) of metal ores, soda ash, 

20 or phosphate to be in separate industrial sectors from the 

21 metal, soda ash, or phosphate manufacturing sectors. In22 dustrial sectors that beneficiate or otherwise process (in23 cluding agglomeration) metal ores, soda ash, or phosphate 

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1 tion related to the activity of extracting metal ores, soda 

2 ash, or phosphate. 

3 ‘‘(f) COMBINED HEAT AND POWER.—For purposes 

4 of this section, and to achieve the purpose set forth in 

5 section 761(4),(the Administrator may consider entities to 

6 be in different industrial sectors or otherwise take into ac7 count the differences among entities in the same industrial 

8 sector, based upon the extent to which such entities use 

9 combined heat and power technologies. 

10 ‘‘SEC. 765. INTERNATIONAL TRADE. 

11 ‘‘It is the sense of the Senate that this Act will con12 tain a trade title that will include a border measure that 

13 is consistent with our international obligations and de14 signed to work in conjunction with provisions that allocate 

15 allowances to energy-intensive and trade-exposed indus16 tries.’’. 

17 TITLE II—PROGRAM 

18 ALLOCATIONS 

19 SEC. 201. INVESTMENT IN CLEAN VEHICLE TECHNOLOGY. 

20 (a) ESTABLISHMENT OF FUND.—There is estab21 lished in the Treasury a separate account, which shall be 

22 known as the ‘‘Clean Vehicle Technology Fund’’. 

23 (b) AUCTION PROCEEDS.—The Administrator shall 

24 deposit the proceeds of the auction conducted pursuant 


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1 to section 771(b)(3) of the Clean Air Act in the Clean 

2 Vehicle Technology Fund. 

3 (c) AVAILABILITY OF AMOUNTS.—Of the amounts 

4 deposited in the Clean Vehicle Technology Fund— 

5 (1) 80 percent shall be available to the Sec6 retary of Energy to support— 

7 (A) the development and demonstration of 

8 a national transportation low-emissions energy 

9 plan; and 

10 (B) the use of plug-in electric drive vehi11 cles, including medium- and heavy-duty motor 

12 vehicles (including transit vehicles) and other 

13 advanced technology vehicles (as defined in sec14 tions 131 and 136 of the Energy Independence 

15 and Security Act of 2007 (42 U.S.C. 17011, 

16 17013)) that are developed and produced in the 

17 United States; and 

18 (2) 20 percent of the amounts shall be available 

19 to the Administrator for use in providing grants au20 thorized under subtitle G of title VII of the Energy 

21 Policy Act of 2005 (42 U.S.C. 16131 et seq.). 

22 (d) PILOT PROGRAM.— 

23 (1) IN GENERAL.—Of the amounts deposited in 

24 accordance with (c)(1), the Secretary of Energy 

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1 tional transportation low-emissions energy plan that 

2 shall— 

3 (A) project the near- and long-term need 

4 for and location of electric drive vehicle refuel5 ing infrastructure at strategic locations across 

6 all major national highways, roads, and cor7 ridors; 

8 (B) identify infrastructure and standard9 ization needs for electricity providers, infra10 structure providers, vehicle manufacturers, and 

11 electricity purchasers; 

12 (C) establish an aspirational goal of 

13 achieving strategic deployment of electric vehi14 cle infrastructure by 2020; 

15 (D) be developed by the Secretary with the 

16 involvement of all relevant stakeholders; and 

17 (E) prioritize the development of— 

18 (i) standardized public charge access 

19 ports with wireless or smart card billing 

20 capability; and 

21 (ii) level I and level II charge port 

22 systems (that charge an electric vehicle 

23 over a period of 8 to 14 hours and 4 to 8 

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1 ergy requirements of the majority of plug2 in hybrid and battery electric vehicles; 

3 (F) examine the feasibility of level III 

4 charge port systems that can charge an electric 

5 vehicle over a period of 10 to 20 minutes; and 

6 (G) focus on infrastructure that provides 

7 consumers with the lowest cost while providing 

8 convenient charge system access. 

9 (2) ELECTRIC DRIVE DEMONSTRATION

10 PROJECTS.— 

11 (A) IN GENERAL.—The Secretary shall es12 tablish pilot projects to demonstrate electric 

13 drive vehicles and infrastructure. 

14 (B) REQUIREMENTS.—The Secretary 

15 shall— 

16 (i) establish the pilot projects de17 scribed in subparagraph (A) after publica18 tion of the plan developed under paragraph 

19 (1); 

20 (ii) use the plan to determine which 

21 regions of the United States are most 

22 ready to demonstrate electric vehicle infra23 structure; 


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1 (iii) carry out the pilot projects under 

2 this paragraph in different regions of the 

3 United States; and 

4 (iv) ensure that— 

5 (I) at least 1 pilot project is car6 ried out in a rural region of the 

7 United States; and 

8 (II) at least 1 pilot project is fo9 cused on freight issues. 

10 (3) FINANCIAL RESOURCES.—In carrying out 

11 the pilot projects under paragraph (2), the Secretary 

12 shall coordinate the use of appropriate financial in13 centives, grant programs, and other Federal finan14 cial resources to ensure that electric infrastructure 

15 delivery entities are able to participate in the pilot 

16 projects. 

17 (4) LEEP COORDINATOR.—The Secretary may 

18 designate 1 full-time position within the Department 

19 of Transportation, to be known as the ‘‘LEEP coor20 dinator’’, with responsibility to oversee— 

21 (A) the development of the plan under 

22 paragraph (1); and 

23 (B) the implementation of the pilot 

24 projects under paragraph (2). 


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1 SEC. 202. STATE AND LOCAL INVESTMENT IN ENERGY EFFI2 CIENCY AND RENEWABLE ENERGY. 

3 (a) DEFINITIONS.—For purposes of this section: 

4 (1) ALLOWANCE.—The term ‘‘allowance’’ 

5 means an emission allowance established under sec6 tion 721 of the Clean Air Act. 

7 (2) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 

8 has the meaning given the term in section 4 of the 

9 Indian Self-Determination and Education Assistance 

10 Act (25 U.S.C. 450b). 

11 (3) VINTAGE YEAR.—The term ‘‘vintage year’’ 

12 has the meaning given the term in section 700 of the 

13 Clean Air Act. 

14 (b) DISTRIBUTION AMONG INDIAN TRIBES, STATES, 

15 LOCAL GOVERNMENTS, METROPOLITAN PLANNING ORGA16 NIZATIONS AND RENEWABLE ELECTRICITY GENERA17 TIONS.—The Administrator shall, in accordance with this 

18 section, distribute allowances allocated pursuant to section 

19 771(a)(8) of the Clean Air Act for the following vintage 

20 year. The Administrator, after consultation with the Sec21 retary of the Interior, shall distribute not less than 1 per22 cent of such allowances to Indian tribes. The Adminis23 trator, after consultation with the Secretary of Energy 

24 and the with the assistance of the Secretary of Transpor25 tation, shall distribute the remaining allowances among 

26 the States, local governments, metropolitan planning orgaVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00783 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 nizations, and renewable electricity generations under this 

2 section each year in accordance with the following for3 mula: 

4 (1) 62.5 percent of the allowances shall be pro5 vided to the States, of which— 

6 (A) 30 percent shall be divided equally 

7 among the States; 

8 (B) 30 percent shall be distributed on a 

9 pro rata basis among the States based on the 

10 population of each State, as contained in the 

11 most recent reliable census data available from 

12 the Bureau of the Census for all States at the 

13 time at which the Administrator calculates the 

14 formula for distribution; 

15 (C) 30 percent shall be distributed on a 

16 pro rata basis among the States on the basis of 

17 the energy consumption of each State, as con18 tained in the most recent State Energy Data 

19 Report available from the Energy Information 

20 Administration (or such alternative reliable 

21 source as the Administrator may designate); 

22 and 

23 (D) 10 percentage shall be provided to the 

24 States based on an energy-efficiency formula 


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1 developed by the Administrator, which formula 

2 shall be— 

3 (i) based on— 

4 (I) weather-adjusted criteria; and 

5 (II) performance-based metrics 

6 that measure each State’s success at 

7 decreasing energy consumption or in8 creasing energy efficiency— 

9 (aa) on a per capita basis in 

10 the residential sector; and 

11 (bb) on an energy consump12 tion per square-foot basis in the 

13 commercial sector; and 

14 (ii) updated every 3 years. 

15 (2) 25 percent of the allowances shall be pro16 vided to local governments for energy conservation 

17 and efficiency grants. 

18 (3) 10 percent of the allowances shall be re19 served by the Secretary of Transportation for grants 

20 to States and metropolitan planning organizations 

21 for greenhouse gas reduction programs in the trans22 portation sector. 

23 (4) 2.5 percent of the allowances shall be pro24 vided to renewable energy generating companies with 

25 a capacity of 20 megawatts or greater exclusively for 


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1 the generation of renewable energy. The Adminis2 trator, in consultation with the Secretary of Energy, 

3 shall award allocations to renewable energy genera4 tion companies based on the number of megawatt5 hours the company generates and the technology 

6 used. The Administrator shall promulgate such regu7 lations as are appropriate to carry out this para8 graph. 

9 (c) USES.—The allowances distributed to each State, 

10 local government, and metropolitan planning organization 

11 pursuant to this section shall be used exclusively in accord12 ance with the following requirements: 

13 (1) ALLOCATION TO STATES.—Allowances allo14 cated to the States under subsection (b)(1) shall be 

15 for the following purposes and be used in accordance 

16 with the following conditions: 

17 (A) PURPOSES.— 

18 (i) ENERGY EFFICIENCY PRO19 GRAMS.—Not less than 35 percent shall be 

20 used exclusively for— 

21 (I) implementation and enforce22 ment of building codes; 

23 (II) implementation of the en24 ergy-efficient manufactured homes 

25 program; 


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1 (III) implementation of building 

2 energy performance labeling; and 

3 (IV) low-income community en4 ergy efficiency programs. 

5 (ii) RENEWABLE ENERGY PRO6 GRAMS.—Renewable energy programs for 

7 capital grants, production incentives, loans, 

8 loan guarantees, forgivable loans, direct 

9 provision of allowances, and interest rate 

10 buy-downs for— 

11 (I) re-equipping, expanding, or 

12 establishing a manufacturing facility 

13 that receives certification from the 

14 Secretary of Energy pursuant to sec15 tion 48C of the Internal Revenue 

16 Code of 1986 for the production of— 

17 (aa) property designed to be 

18 used to produce energy from re19 newable energy sources; and 

20 (bb) electricity storage sys21 tems; 

22 (II) deployment of technologies to 

23 generate electricity from renewable 

24 energy sources; and 


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1 (III) deployment of facilities or 

2 equipment, such as solar panels, to 

3 generate electricity or thermal energy 

4 from renewable energy resources in 

5 and on buildings in an urban environ6 ment. 

7 (iii) IMPROVEMENT IN ELECTRICITY

8 TRANSMISSION.—Improvement in elec9 tricity transmission for 1 or more of the 

10 following purposes: 

11 (I) State implementation of elec12 tricity transmission planning and 

13 siting activities that facilitate renew14 able energy development, including fa15 cilitation of landowner negotiations 

16 for transmission of right-of-way leas17 ing or other contractual arrange18 ments. 

19 (II) Grants to nonprofit organi20 zations that facilitate negotiations for 

21 transmission right-of-way leasing or 

22 other contractual agreements between 

23 landowners and developers. 

24 (III) State or regional studies of 

25 renewable energy zones and resources 


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1 with insufficient transmission capac2 ity, including geographical identifica3 tion of potential renewable energy 

4 sites, environmental reviews, and land 

5 use or coastal zone constraints. 

6 (IV) Grants to support land7 owner associations’ and other non8 profit organizations’ participation in 

9 State and Federal siting processes, in10 cluding such associations’ studies of 

11 renewable energy feasibility and bene12 fits and associated data collection. 

13 (V) Grants to landowners or 

14 landowner associations or nonprofit 

15 organizations for mitigation of im16 pacts on property or ecosystems due 

17 to transmission projects that are part 

18 of an interconnection-wide plan fo19 cused on facilitating renewable energy 

20 development. 

21 (VI) Training for State regu22 latory authority staff and local 

23 workforces relating to renewable en24 ergy generation resources and storage, 


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1 smart grid, or new transmission tech2 nologies. 

3 (VII) Grants to transmission pro4 viders for transmission improvements 

5 (including smart grid investments) 

6 that benefit consumers. 

7 (VIII) Grants to transmission 

8 providers for security upgrades to the 

9 transmission system and authorized 

10 uses under title XIII of the Energy 

11 Independence and Security Act of 

12 2007 (42 U.S.C. 17381 et seq.). 

13 (IX) Grants to develop energy 

14 storage, reliability, or distributed re15 newable generation projects. 

16 (iv) END-USE CONSUMERS.—Cost-ef17 fective energy efficiency programs for end18 use consumers of electricity, natural gas, 

19 home heating oil, or propane, including, 

20 where appropriate, programs or mecha21 nisms administered by local governments 

22 and entities other than the State. 

23 (v) RETROFITS AND HOUSING INVEST24 MENTS.—Energy retrofits and green in25 vestments in subsidized housing based on 


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1 standards to ensure that investments are 

2 cost-effective, taking into account reduc3 tions in future use of energy and other 

4 utilities, and the extent to which such ret5 rofits and investments address repair and 

6 replacement needs that may otherwise need 

7 to be addressed with other forms of assist8 ance. As a condition of such funding, the 

9 recipient shall commit to an additional pe10 riod of affordability of not fewer than 15 

11 years, covering all units for which such 

12 grants and loans are used. 

13 (vi) THERMAL ENERGY EFFI14 CIENCY.—Not less than 2 percent shall be 

15 used for thermal energy efficiency projects 

16 that provide district thermal energy 

17 through a network of pipes from 1 or more 

18 central plants to at least 2 or more build19 ings, combined heat and power that pro20 duces electricity and thermal energy with a 

21 minimum 60 percent overall efficiency on a 

22 lower-heating value basis, or recoverable 

23 waste energy (including mechanical, ther24 mal, or electrical energy) that, if not for 

25 recovery, would be wasted and may be reVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00791 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 covered or generated through modification 

2 of an existing facility or addition of a new 

3 facility. Allocations may be used for plan4 ning, engineering, and feasibility studies as 

5 well as project construction and develop6 ment. Such projects shall— 

7 (I) reduce or avoid greenhouse 

8 gas emissions; and 

9 (II)(aa) produce thermal energy 

10 from renewable energy resources or 

11 natural cooling sources; 

12 (bb) capture and productively use 

13 thermal energy from an electric gen14 eration facility; 

15 (cc) integrate new electricity gen16 eration into an existing district energy 

17 system; 

18 (dd) capture and productively 

19 uses surplus thermal energy from an 

20 industrial or municipal process (such 

21 as wastewater treatment); or 

22 (ee) distribute and transfer to 

23 buildings the thermal energy from the 

24 energy sources described in items (aa) 

25 through (dd). 


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1 (vii) SMART GRID DEVELOPMENT.— 

2 Enabling the development of a Smart Grid 

3 (as described in section 1301 of the En4 ergy Independence and Security Act of 

5 2007 (42 U.S.C. 17381)) for State, local 

6 government, and other public buildings and 

7 facilities, including integration of renew8 able energy resources and distributed gen9 eration, demand response, demand-side 

10 management, and systems analysis. 

11 (B) CONDITIONS.— 

12 (i) IN GENERAL.—The States shall 

13 prioritize expansion of existing energy effi14 ciency programs approved and overseen by 

15 the State or the appropriate State regu16 latory authority. 

17 (ii) SUPPLEMENTATION.—The States 

18 shall demonstrate that such allowances 

19 have been used to supplement, and not to 

20 supplant, existing and otherwise available 

21 State, local, and ratepayer funding for 

22 such purpose. 

23 (2) ENERGY CONSERVATION AND EFFI24 CIENCY.—Allowances allocated to local governments 

25 under subsection (b)(2) shall be used exclusively for 


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1 energy conservation and efficiency purposes specified 

2 under section 543 of the Energy Independence and 

3 Security Act of 2007 (42 U.S.C. 17153). 

4 (3) STATE AND MPO GRANTS.—Allocation to 

5 the Secretary of Transportation for grants to States 

6 and metropolitan planning organizations under sub7 section (b)(3) shall be used exclusively for the 

8 Transportation Greenhouse Gas Reduction program 

9 in accordance with sections 831 and 832 of the 

10 Clean Air Act. 

11 (d) REPORTING.—Each Indian tribe, State, local gov12 ernment, metropolitan planning organization, and renew13 able electricity generating company directly receiving al14 lowances or allowance value under this section shall sub15 mit to the Administrator a report that contains a list of 

16 entities receiving allowances or allowance value under this 

17 section. 

18 (e) ENFORCEMENT.—If the Administrator deter19 mines that an Indian tribe, State, local government, met20 ropolitan planning organization, or renewable electricity 

21 generation company is not in compliance with this section, 

22 the Administrator may withhold up to twice the number 

23 of allowances or allowance value that the Indian tribe, 

24 State, local government, metropolitan planning organiza25 tion, or renewable electricity generation company failed to 


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1 use in accordance with the requirements of this section, 

2 that such Indian tribe, State, local government, metropoli3 tan planning organization, or renewable electricity genera4 tion companies would otherwise be eligible to receive under 

5 this section in later years. Allowances withheld pursuant 

6 to this subsection shall be distributed among the remain7 ing Indian tribes, States, local governments, metropolitan 

8 planning organizations, and renewable electricity genera9 tion companies in accordance with subsection (b). 

10 SEC. 203. ENERGY EFFICIENCY IN BUILDING CODES. 

11 The Administrator shall distribute emission allow12 ances allocated for the following vintage year pursuant to 

13 section 771(a)(9) of the Clean Air Act among the States 

14 in accordance with the formula described in section 202 

15 of this division exclusively for the purpose of section 163 

16 of division A. 

17 SEC. 204. BUILDING RETROFIT PROGRAM. 

18 The Administrator shall distribute emission allow19 ances allocated for the following vintage year pursuant to 

20 section 771(a)(10) of the Clean Air Act among the States 

21 in accordance with the formula described in section 202 

22 of this division exclusively for the purpose of section 164 

23 of division A. 


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1 SEC. 205. ENERGY INNOVATION HUBS. 

2 (a) PURPOSE.—The Secretary shall carry out a pro3 gram in accordance with this section to establish Energy 

4 Innovation Hubs to enhance the economic, environmental, 

5 and energy security of the United States by promoting 

6 commercial application of clean, indigenous energy alter7 natives to oil and other fossil fuels, reducing greenhouse 

8 gas emissions, and ensuring that the United States main9 tains a technological lead in the development and commer10 cial application of state-of-the-art energy technologies. 

11 (b) DISTRIBUTION OF ALLOWANCES TO ENERGY IN12 NOVATION HUBS.—The Secretary shall, in accordance 

13 with the requirements of this section, distribute to eligible 

14 consortia allowances allocated for the following vintage 

15 year under section 772(a)(11) of the Clean Air Act. 

16 SEC. 206. ARPA–E RESEARCH. 

17 (a) DEFINITIONS.—For purposes of this section: 

18 (1) ALLOWANCE.—The term ‘‘allowance’’ 

19 means an emission allowance established under sec20 tion 721 of the Clean Air Act. 

21 (2) DIRECTOR.—The term ‘‘Director’’ means 

22 Director of the Advanced Research Projects Agency– 

23 Energy. 

24 (b) DISTRIBUTION OF ALLOWANCES.—The Director, 

25 in accordance with this section, shall distribute allowances 

26 allocated for the following vintage year under section 


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1 771(a)(12) of the Clean Air Act. Such allowances shall 

2 be distributed on a competitive basis to institutions of 

3 higher education, companies, research foundations, trade 

4 and industry research collaborations, or consortia of such 

5 entities, or other appropriate research and development 

6 entities to achieve the goals of the Advanced Research 

7 Projects Agency-Energy (as described in section 5012(c) 

8 of the America COMPETES Act (42 U.S.C. 16538(c))) 

9 through targeted acceleration of— 

10 (1) novel early-stage energy research with pos11 sible technology applications; 

12 (2) development of techniques, processes, and 

13 technologies, and related testing and evaluation; 

14 (3) development of manufacturing processes for 

15 technologies; and 

16 (4) demonstration and coordination with non17 governmental entities for commercial applications of 

18 technologies and research applications. 

19 (c) SUPPLEMENT NOT SUPPLANT.—Assistance pro20 vided under this section shall be used to supplement, and 

21 not to supplant, any other Federal resources available to 

22 carry out activities described in this section. 


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1 SEC. 207. INTERNATIONAL CLEAN ENERGY DEPLOYMENT 

2 PROGRAM. 

3 The Secretary of State shall distribute emission al4 lowances allocated for the following vintage year pursuant 

5 to section 771(a)(13) of the Clean Air Act exclusively for 

6 the purpose of section 323 of division A. 

7 SEC. 208. INTERNATIONAL CLIMATE CHANGE ADAPTATION 

8 AND GLOBAL SECURITY. 

9 The Secretary of State shall distribute emission al10 lowances allocated for the following vintage year pursuant 

11 to section 771(a)(14) of the Clean Air Act exclusively for 

12 the purpose of section 324 of division A. 

13 SEC. 209. ENERGY EFFICIENCY AND RENEWABLE ENERGY 

14 WORKER TRAINING. 

15 (a) ESTABLISHMENT OF FUND.—There is estab16 lished in the Treasury a separate account, to be known 

17 as the ‘‘Energy Efficiency and Renewable Energy Worker 

18 Training Fund’’. 

19 (b) AUCTION PROCEEDS.—The Administrator shall 

20 deposit the proceeds of the auction conducted pursuant 

21 to section 771(b)(5) of the Clean Air Act in the Energy 

22 Efficiency and Renewable Energy Worker Training Fund. 

23 (c) AVAILABILITY OF AMOUNTS.—The Secretary of 

24 Energy shall use the amounts deposited in the Energy Ef25 ficiency and Renewable Energy Worker Training Fund 

26 under subsection (b) to carry out section 171(e)(8) of the 


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1 Workforce Investment Act of 1998 (29 U.S.C. 2916(e)(8)) 

2 without further appropriation or fiscal year limitation. 

3 SEC. 210. WORKER TRANSITION. 

4 (a) ESTABLISHMENT OF FUND.—There is estab5 lished in the Treasury a separate account, to be known 

6 as the ‘‘Worker Transition Fund’’. 

7 (b) AUCTION PROCEEDS.—The Administrator shall 

8 deposit the proceeds of the auction conducted pursuant 

9 to section 771(b)(6) of the Clean Air Act in the Worker 

10 Transition Fund. 

11 (c) AVAILABILITY OF AMOUNTS.—The amounts de12 posited in the Worker Transition Fund shall be used to 

13 carry out part 2 of subtitle A of title III of division A. 

14 SEC. 211. STATE PROGRAMS FOR GREENHOUSE GAS RE15 DUCTION AND CLIMATE ADAPTATION. 

16 (a) DEFINITIONS.—In this section: 

17 (1) ALASKA NATIVE VILLAGE.—The term 

18 ‘‘Alaska Native village’’ means a federally recognized 

19 Indian tribe located in the State of Alaska and listed 

20 in the Bureau of Indian Affairs publication entitled 

21 ‘‘Indian Entities Recognized and Eligible to Receive 

22 Services from the United States Bureau of Indian 

23 Affairs’’ (74 Fed. Reg. 40218 (Aug. 11, 2009)). 


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1 (2) ALLOWANCE.—The term ‘‘allowance’’ 

2 means an emission allowance established under sec3 tion 721 of the Clean Air Act. 

4 (3) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 

5 has the meaning given the term in section 4 of the 

6 Indian Self-Determination and Education Assistance 

7 Act (25 U.S.C. 450b). 

8 (4) SCCR ACCOUNT.—The term ‘‘SCCR Ac9 count’’ means a State Climate Change Response Ac10 count established under subsection (d)(5). 

11 (5) VINTAGE YEAR.—The term ‘‘vintage year’’ 

12 has the meaning given that term in section 700 of 

13 the Clean Air Act. 

14 (b) REGULATIONS; COORDINATION.— 

15 (1) REGULATIONS.—Not later than 2 years 

16 after the date of enactment of this Act, the Adminis17 trator, or the heads of such Federal agencies as the 

18 President may designate, shall promulgate regula19 tions to implement this section. 

20 (2) COORDINATION.—If the President des21 ignates more than 1 Federal agency to implement 

22 this section, the President shall require such agen23 cies to establish a memorandum of understanding 

24 providing for coordination of rulemaking and other 


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1 implementing activities, in accordance with this sec2 tion. 

3 (c) STATE CLIMATE CHANGE RESPONSE AND TRANS4 PORTATION FUND.— 

5 (1) ESTABLISHMENT OF FUND.—There is es6 tablished in the Treasury a separate account, to be 

7 known as the ‘‘State Climate Change Response and 

8 Transportation Fund’’. 

9 (2) AUCTION PROCEEDS DEPOSITED TO

10 FUND.—The Administrator shall deposit the pro11 ceeds of the auction conducted pursuant to section 

12 771(b)(7) of the Clean Air Act in the State Climate 

13 Change Response and Transportation Fund. 

14 (3) AVAILABILITY OF AMOUNTS.—All amounts 

15 deposited in the State Climate Change Response and 

16 Transportation Fund shall be available, without fur17 ther appropriation or fiscal year limitation, to carry 

18 out this section. 

19 (d) DISTRIBUTION OF ALLOWANCE PROCEEDS.— 

20 (1) IN GENERAL.—The Administrator shall dis21 tribute, in accordance with this section, proceeds of 

22 the auction of allowances allocated for the following 

23 vintage year that have been deposited in the State 

24 Climate Change Response and Transportation Fund 

25 pursuant to subsection (c)(2). 


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1 (2) RESERVATION AND ALLOCATION.—The Ad2 ministrator shall— 

3 (A) reserve 10 percent of the proceeds of 

4 such allowances described in paragraph (1) for 

5 distribution among coastal and Great Lakes 

6 States in accordance with subsection (f); 

7 (B) after consultation with the Secretary 

8 of the Interior, reserve at least 1 percent of the 

9 proceeds of those allowances for distribution to 

10 Indian tribes in accordance with subsection (e); 

11 and 

12 (C) distribute the remaining proceeds of 

13 those allowances to fund State and local govern14 ment programs for greenhouse gas reduction 

15 and climate adaptation, with such remaining 

16 proceeds divided equally between— 

17 (i) funding of transportation grant 

18 programs under subsection (g); and 

19 (ii) funding of other programs admin20 istered by the States, with the proceeds to 

21 be deposited in and administered through 

22 the State Climate Change Response Ac23 counts established pursuant to paragraph 

24 (5). 


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1 (3) FORMULA FOR DISTRIBUTION.—The Ad2 ministrator shall distribute the proceeds to be allo3 cated pursuant to paragraph (2)(C)(ii) ratably 

4 among the States based on the product obtained by 

5 multiplying— 

6 (A) the population of a State; and 

7 (B) the allocation factor for the State de8 termined under paragraph (4). 

9 (4) STATE ALLOCATION FACTORS.— 

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

11 subparagraph (B), the allocation factor for a 

12 State shall be the quotient obtained by divid13 ing— 

14 (i) the per capita income of all indi15 viduals in the United States; by 

16 (ii) the per capita income of all indi17 viduals in the State. 

18 (B) LIMITATION.— 

19 (i) MAXIMUM.—If the allocation fac20 tor for a State as calculated under sub21 paragraph (A) would exceed 1.2, the allo22 cation factor for such State shall be 1.2. 

23 (ii) MINIMUM.—If the allocation fac24 tor for a State as calculated under sub25 paragraph (A) would be less than 0.8, the 


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1 allocation factor for such State shall be 

2 0.8. 

3 (C) PER CAPITA INCOME.—For purposes 

4 of this paragraph, per capita income shall be— 

5 (i) determined at 2-year intervals; and 

6 (ii) subject to subparagraph (D), 

7 equal to the average of the annual per cap8 ita incomes for the most recent period of 

9 3 consecutive years for which satisfactory 

10 data are available from the Department of 

11 Commerce at the time such determination 

12 is made. 

13 (D) REVENUE DIRECTLY RESULTING FROM

14 A PRESIDENTIALLY DECLARED MAJOR DIS15 ASTER.— 

16 (i) IN GENERAL.—For purposes of 

17 this paragraph, per capita income from 1 

18 or more of the sources described in clause 

19 (ii) shall be reduced or excluded if the Sec20 retary of Commerce— 

21 (I) (in consultation with the Ad22 ministrator and the heads of the de23 partments or agencies involved) deter24 mines that the income accrues to per25 sons as the result of a major disaster 


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1 designated by the President under the 

2 Robert T. Stafford Disaster Relief 

3 and Emergency Assistance Act (42 

4 U.S.C. 5121 et seq.); and 

5 (II) finds that the inclusion of 1 

6 or more of the income sources, in 

7 whole or in part, results in a transi8 tory, rather than a sustainable, in9 crease in a State’s per capita income 

10 level relative to the national average. 

11 (ii) SOURCES OF INCOME.—The 

12 sources of income referred to in clause (i) 

13 are the following: 

14 (I) Property and casualty insur15 ance (including homeowners and rent16 ers insurance). 

17 (II) The National Flood Insur18 ance Program of the Federal Emer19 gency Management Agency. 

20 (III) The Individual and Family 

21 Grants Program of the Federal Emer22 gency Management Agency. 

23 (IV) The Disaster Housing Pro24 gram of the Federal Emergency Man25 agement Agency. 


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1 (V) The Community Develop2 ment Block Grant Program of the De3 partment of Housing and Urban De4 velopment. 

5 (VI) The Disaster Unemployment 

6 Assistance Program of the Depart7 ment of Labor. 

8 (VII) Any other source deter9 mined appropriate by the Adminis10 trator. 

11 (5) STATE CLIMATE CHANGE RESPONSE AC12 COUNTS.—Each State shall establish a State Cli13 mate Change Response Account, to be administered 

14 pursuant to State law, to receive and distribute the 

15 amounts provided under paragraph (2)(C)(ii). State 

16 regulations and implementing procedures relating to 

17 such accounts shall require compliance with the pro18 visions of this section and all other applicable provi19 sions of Federal law. 

20 (e) DISTRIBUTION TO INDIAN TRIBES.— 

21 (1) IN GENERAL.—The Administrator, or the 

22 heads of such Federal agencies as the President may 

23 designate, shall promulgate regulations establishing 

24 a program to distribute allowance proceeds to Indian 

25 tribes, in accordance with the requirements of this 


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1 section, of which not less than 18 percent shall be 

2 allocated to Alaska Native Villages for each year. 

3 (2) USE OF PROCEEDS.—Allowance proceeds 

4 distributed to Indian tribes shall be used exclu5 sively— 

6 (A) in accordance with subsection (h); and 

7 (B) in compliance with any approved tribal 

8 climate change response plan. 

9 (f) DISTRIBUTION TO COASTAL AND GREAT LAKES

10 STATES.—The Administrator, or the heads of such other 

11 Federal agencies as the President may designate, shall dis12 tribute proceeds of emission allowances for coastal State 

13 economic protection each fiscal year, in accordance with 

14 section 384 of division A. 

15 (g) DISTRIBUTION OF TRANSPORTATION GRANTS.— 

16 (1) DISTRIBUTION OF TRANSPORTATION

17 GRANTS.— 

18 (A) IN GENERAL.—The Secretary of 

19 Transportation, in consultation with the Admin20 istrator, shall distribute the amounts allocated 

21 for transportation grants each fiscal year in ac22 cordance with subsection (d)(2)(C)(i) as grants 

23 to public transportation agencies (including des24 ignated recipients (as defined in section 

25 5307(a) and section 5340 of title 49, United 


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1 States Code)) and recipients and sub-recipients 

2 (as defined in section 5311(a) of title 49, 

3 United States Code). 

4 (B) FORMULA.—In providing grants under 

5 this subsection, the Secretary shall distribute— 

6 (i) 80 percent of the funds in accord7 ance with the formula and conditions gov8 erning grants under section 5307 of title 

9 49, United States Code; 

10 (ii) 10 percent of the funds in accord11 ance with the formula and conditions gov12 erning grants under section 5311 of title 

13 49, United States Code; and 

14 (iii) 10 percent of the funds in accord15 ance with the formula and conditions gov16 erning grants under section 5340 of title 

17 49, United States Code. 

18 (h) USES OF ALLOWANCE PROCEEDS DEPOSITED TO

19 SCCR ACCOUNTS.— 

20 (1) IN GENERAL.—States shall use allowance 

21 proceeds deposited to SCCR Accounts under sub22 section (d)(2)(C)(ii) exclusively for the development 

23 and implementation of projects, programs, or meas24 ures as described in this section to address climate 

25 change by reducing emissions of greenhouse gases or 


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1 by building resilience to the impacts of climate 

2 change, including impacts such as— 

3 (A) extreme weather events, such as flood4 ing and tropical cyclones; 

5 (B) more frequent heavy precipitation 

6 events; 

7 (C) water scarcity and adverse impacts on 

8 water quality; 

9 (D) stronger and longer heat waves; 

10 (E) more frequent and severe droughts; 

11 (F) rises in sea level; 

12 (G) ecosystem disruption; 

13 (H) increased wildfire risk; 

14 (I) increased air pollution; 

15 (J) effects on public health; 

16 (K) impaired transportation systems and 

17 infrastructure; and 

18 (L) reduced productivity of agricultural or 

19 ranching operations. 

20 (2) REQUIREMENTS.—The allowance proceeds 

21 received by each SCCR Account for each fiscal year 

22 shall be used by the State exclusively to fund the fol23 lowing categories of activities, in compliance with the 

24 provisions of approved State climate change re25 sponse plans: 


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1 (A) Grants to fund water system mitiga2 tion and adaptation partnerships in accordance 

3 with section 381 of division A. 

4 (B) Flood control, protection, prevention 

5 and response programs and projects in accord6 ance with section 382 of division A. 

7 (C) Programs or projects implemented by 

8 State agencies as owners or operators of water 

9 systems to address any ongoing or forecasted 

10 climate-related impact on water quality, water 

11 supply or reliability, for 1 or more of the pur12 poses listed in section 381(d) of division A. 

13 (D) Programs or projects to reduce green14 house gas emissions through recycling or for in15 creasing recycling rates in accordance with sec16 tion 154 of division A. 

17 (E) Programs and projects addressing ad18 verse impacts of climate change affecting agri19 culture or ranching activities. 

20 (F) Programs or projects addressing air 

21 pollution or air quality impacts caused or exac22 erbated by climate change. 

23 (G) Programs or projects to reduce green24 house gas emissions that result in a decrease in 

25 emissions of other air pollutants. 


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1 (3) DISTRIBUTION FOR LOCAL GOVERN2 MENTS.—Not less than 12.5 percent of the proceeds 

3 deposited to SCCR Accounts shall be distributed by 

4 each State to units of local government within such 

5 State, to be used exclusively to support the cat6 egories of climate change response efforts listed in 

7 paragraph (2). 

8 (4) VULNERABLE POPULATIONS.—In deploying 

9 allowance proceeds under this section, States and 

10 units of local government shall ensure that programs 

11 and projects are funded responding to impacts af12 fecting socially and economically vulnerable popu13 lations, including— 

14 (A) persons of low-income (as defined in 

15 title I of the Housing and Community Develop16 ment Act of 1974, (42 U.S.C. 5301 et seq.)); 

17 (B) members of socially disadvantaged 

18 groups (as defined in section 2501(e)(2) of the 

19 Food, Agriculture, Conservation, and Trade Act 

20 of 1990 (7 U.S.C. 2279(e)(2))); 

21 (C) individuals over 65 years of age and 

22 under 5 years of age; and 

23 (D) individuals with disabilities. 

24 (5) INTENT OF CONGRESS.—It is the intent of 

25 the Congress that allowances distributed to carry 


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1 out this section should be used to supplement, and 

2 not replace, existing sources of funding used to ad3 dress and build resilience to the impacts of climate 

4 change. 

5 (i) STATE AND TRIBAL CLIMATE CHANGE RESPONSE

6 PLANS.— 

7 (1) IN GENERAL.—The regulations promulgated 

8 pursuant to subsection (b) shall include require9 ments for submission and approval of State and 

10 tribal climate change response plans under this sec11 tion. Beginning with vintage year 2012, distribution 

12 of allowance proceeds to a State pursuant to this 

13 section shall be contingent on approval of a State 

14 climate change response plan for such State that 

15 meets the requirements of such regulations. 

16 (2) REQUIREMENTS.—Regulations promulgated 

17 under this section shall require, at minimum, that 

18 State climate change response plans— 

19 (A) assess and prioritize the vulnerability 

20 of a State to a broad range of impacts of cli21 mate change, based on the best available 

22 science; 

23 (B) identify and prioritize specific cost-ef24 fective projects, programs, and measures to 

25 mitigate and build resilience to current and preVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00812 Fmt 6652 Sfmt 6401 E:\BILLS\S1733.RS S1733

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1 dicted impacts of climate change, including 

2 projects, programs, and measures within each 

3 of the categories of activities listed in sub4 section (h)(2); 

5 (C) include an assessment of potential for 

6 carbon reduction through changes to land man7 agement policies (including enhancement or 

8 protection of forest carbon sinks); 

9 (D) ensure that the State fully considers 

10 and undertakes, to the maximum extent prac11 ticable, initiatives that— 

12 (i) protect or enhance natural eco13 system functions, including protection, 

14 maintenance, or restoration of natural in15 frastructure such as wetlands, reefs, and 

16 barrier islands to buffer communities from 

17 floodwaters or storms, watershed protec18 tion to maintain water quality and ground19 water recharge, or floodplain restoration to 

20 improve natural flood control capacity; 

21 (ii) where appropriate, use non22 structural approaches, including practices 

23 that use, enhance, or mimic the natural 

24 hydrologic cycle processes of infiltration, 

25 evapotranspiration, and use; or 


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1 (iii) where appropriate, protect for2 ested land via scientifically based ecological 

3 restoration practices, including by reducing 

4 fuel loads, restoring forest diversity, and 

5 conducting research on pest mitigation; 

6 (E) give consideration to impacts affecting 

7 socially and economically vulnerable popu8 lations, including— 

9 (i) persons of low-income (as defined 

10 in title I of the Housing and Community 

11 Development Act of 1974 (42 U.S.C. sec. 

12 5301 et seq.)); 

13 (ii) members of socially disadvantaged 

14 groups (as defined in section 2501(e)(2) of 

15 the Food, Agriculture, Conservation, and 

16 Trade Act of 1990 (7 U.S.C. 2279(e)(2))); 

17 (iii) persons over 65 years of age and 

18 under 5 years of age; and 

19 (iv) persons with disabilities; 

20 (F) use pre-disaster mitigation, emergency 

21 response, and public insurance programs to 

22 mitigate the impacts of climate change; 

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1 imum extent practicable, avoid environmental 

2 degradation; and 

3 (H) be revised and resubmitted for ap4 proval not less frequently than every 5 years. 

5 (3) TRIBAL CLIMATE CHANGE RESPONSE

6 PLANS.—Requirements for tribal climate change re7 sponse plans should include the requirements listed 

8 in subparagraphs (A) through (H) of paragraph (2), 

9 as appropriate, but may vary from those of State cli10 mate change response plans to the extent necessary 

11 to account for the special circumstances of Indian 

12 tribes. 

13 (4) COORDINATION WITH PRIOR PLANNING EF14 FORTS.—In implementing this subsection, the Ad15 ministrator, or the heads of such Federal agencies 

16 as the President may designate, shall— 

17 (A) draw upon lessons learned and best 

18 practices from pre-existing State and tribal cli19 mate change response planning efforts; 

20 (B) seek to avoid duplication of such ef21 forts; and 

22 (C) ensure that the plans developed under 

23 this section are developed in coordination with 

24 State natural resources adaptation plans devel25 oped under section 369 of division A. 


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1 (j) REPORTING.—Not later than 1 year after each 

2 date of receipt of allowance proceeds under this section, 

3 and biennially thereafter until the value of any allowance 

4 proceeds received under this section has been fully ex5 pended, each State or Indian tribe receiving allowance pro6 ceeds under this section shall submit to the Administrator, 

7 or the heads of such Federal agencies as the President 

8 may designate, a report that— 

9 (1) provides a full accounting for the use by the 

10 State or Indian tribe of allowance proceeds distrib11 uted under this section, including a description of 

12 the projects, programs, or measures supported using 

13 such proceeds; 

14 (2) includes a report prepared by an inde15 pendent third party, in accordance with such regula16 tions as are promulgated by the Administrator or 

17 the heads of such other Federal agencies as the 

18 President may designate, evaluating the performance 

19 of the projects, programs, or measures supported 

20 under this section; and 

21 (3) identifies any use by the State or Indian 

22 tribe of allowance proceeds distributed under this 

23 section for the reduction of flood and storm damage 

24 and the effects of climate change on water and flood 

25 protection infrastructure. 


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1 (k) AUDITING.—The Administrator, or the heads of 

2 such Federal agencies as the President may designate, 

3 shall have authority to conduct such audits or other review 

4 of States implementation of and compliance with this sec5 tion as such Federal officials may in their discretion deter6 mine to be necessary or appropriate. 

7 (l) ENFORCEMENT.—If the Administrator, or the 

8 heads of such Federal agencies as the President may des9 ignate, determine that a State or Indian tribe is not in 

10 compliance with this section, the Administrator or such 

11 other agency head may withhold a quantity of the allow12 ance proceeds equal to up to twice the quantity of allow13 ance proceeds that the State or Indian tribe failed to use 

14 in accordance with the requirements of this section, that 

15 such State or Indian tribe would otherwise be eligible to 

16 receive under this section in 1 or more later years. Allow17 ance proceeds withheld pursuant to this subsection shall 

18 be distributed among the remaining States or Indian 

19 tribes ratably in accordance with— 

20 (1) the formula under subsection (d), in the 

21 case of allowances withheld from a State; or 

22 (2) in accordance with subsection (e), in the 

23 case of allowance proceeds withheld from an Indian 

24 tribe. 


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1 SEC. 212. CLIMATE CHANGE HEALTH PROTECTION AND 

2 PROMOTION FUND. 

3 (a) ESTABLISHMENT OF FUND.—There is estab4 lished in the Treasury a separate account, to be known 

5 as the ‘‘Climate Change Health Protection and Promotion 

6 Fund’’. 

7 (b) AUCTION PROCEEDS.—The Administrator shall 

8 deposit the proceeds of the auction pursuant to section 

9 771(b)(8) of the Clean Air Act in the Climate Change 

10 Health Protection and Promotion Fund. 

11 (c) AVAILABILITY OF AMOUNTS.—All amounts depos12 ited in the Climate Change Health Protection and Pro13 motion Fund shall be available to the Secretary of Health 

14 and Human Services to carry out subpart B of subtitle 

15 C of title III of division A, without further appropriation 

16 or fiscal year limitation. 

17 (d) DISTRIBUTION OF FUNDS BY HHS.—In carrying 

18 out subpart B of subtitle C of title III of division A, the 

19 Secretary of Health and Human Services may make funds 

20 deposited in the Climate Change Health Protection and 

21 Promotion Fund available to— 

22 (1) other departments, agencies, and offices of 

23 the Federal Government; 

24 (2) foreign, State, tribal, and local govern25 ments; and 


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1 (3) such other entities as the Secretary deter2 mines to be appropriate. 

3 (e) SUPPLEMENT, NOT REPLACE.—It is the intent 

4 of Congress that funds made available to carry out sub5 part B of subtitle C of title III of division A should be 

6 used to supplement, and not replace, existing sources of 

7 funding for public health. 

8 SEC. 213. CLIMATE CHANGE SAFEGUARDS FOR NATURAL 

9 RESOURCES CONSERVATION. 

10 (a) ESTABLISHMENT OF FUND.—There is estab11 lished in the Treasury a separate account, to be known 

12 as the ‘‘Natural Resources Climate Change Adaptation 

13 Account’’. 

14 (b) AUCTION PROCEEDS.—The Administrator shall 

15 deposit the proceeds of the auction conducted pursuant 

16 to section 771(b)(9) of the Clean Air Act in the Natural 

17 Resources Climate Change Adaptation Account. 

18 (c) AVAILABILITY OF AMOUNTS.—All amounts depos19 ited in the Natural Resources Climate Change Adaptation 

20 Account shall be available without further appropriation 

21 or fiscal year limitation solely for the purposes of section 

22 370 of division A. 


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1 SEC. 214. NUCLEAR WORKER TRAINING. 

2 (a) ESTABLISHMENT OF FUND.—There is estab3 lished in the Treasury a separate account, to be known 

4 as the ‘‘Nuclear Worker Training Fund’’. 

5 (b) AUCTION PROCEEDS.—The Administrator shall 

6 deposit the proceeds of the auction conducted pursuant 

7 to section 771(b)(10) of the Clean Air Act in the Nuclear 

8 Worker Training Fund. 

9 (c) AVAILABILITY OF AMOUNTS.—All amounts depos10 ited in the Nuclear Worker Training Fund shall be avail11 able without further appropriation or fiscal year limitation 

12 solely for the purpose of carrying out section 132 of divi13 sion A. 

14 SEC. 215. SUPPLEMENTAL AGRICULTURE, RENEWABLE EN15 ERGY, AND FORESTRY. 

16 (a) ESTABLISHMENT OF FUND.—There is estab17 lished in the Treasury a separate account, to be known 

18 as the ‘‘Supplemental Agriculture, Renewable Energy, and 

19 Forestry Fund’’. 

20 (b) AUCTION PROCEEDS.—The Administrator shall 

21 deposit the proceeds of the auction conducted pursuant 

22 to section 771(b)(11) of the Clean Air Act in the Supple23 mental Agriculture, Renewable Energy, and Forestry 

24 Fund. 

25 (c) AVAILABILITY OF AMOUNTS.—All amounts depos26 ited in the Supplemental Agriculture, Renewable Energy, 


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1 and Forestry Fund shall be available without further ap2 propriation or fiscal year limitation solely for the purpose 

3 of carrying out section 155 of division A. 

4 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

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

6 ‘‘Clean Energy Jobs and American Power Act’’. 

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

8 Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Findings. 

Sec. 3. Economywide emission reduction goals. 

Sec. 4. Definitions. 

DIVISION A—AUTHORIZATIONS FOR POLLUTION REDUCTION, 

TRANSITION, AND ADAPTATION 

Sec. 101. Structure of Act. 

Sec. 102. Requirements relating to Federal advisory committees. 

Sec. 103. Voluntary renewable energy markets. 

TITLE I—GREENHOUSE GAS REDUCTION PROGRAMS 

Subtitle A—Clean Transportation 

Sec. 111. Emission standards. 

‘‘PART B—MOBILE SOURCES

‘‘Sec. 821. Greenhouse gas emission standards for mobile sources. 

Sec. 112. Greenhouse gas emission reductions through transportation efficiency. 

‘‘PART C—TRANSPORTATION EMISSIONS

‘‘Sec. 831. Greenhouse gas emission reductions through transportation efficiency. 

Sec. 113. Transportation greenhouse gas emission reduction program grants. 

‘‘Sec. 832. Transportation greenhouse gas emission reduction program 

grants. 

Sec. 114. Smartway transportation efficiency program. 

‘‘Sec. 822. SmartWay transportation efficiency program. 

Subtitle B—Carbon Capture and Sequestration 

Sec. 121. National strategy. 

Sec. 122. Regulations for geological sequestration sites. 

‘‘Sec. 813. Geological storage sites. 

Sec. 123. Studies and reports. 

Sec. 124. Performance standards for new coal-fueled power plants. 


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‘‘Sec. 812. Performance standards for new coal-fired power plants. 

Sec. 125. Carbon capture and sequestration demonstration and early deployment 

program. 

Subtitle C—Nuclear and Advanced Technologies 

Sec. 131. Findings and policy. 

Sec. 132. Nuclear worker training. 

Sec. 133. Nuclear safety and waste management programs. 

Subtitle D—Water Efficiency 

Sec. 141. WaterSense. 

Sec. 142. Federal procurement of water-efficient products. 

Sec. 143. State residential water efficiency and conservation incentives program. 

Subtitle E—Miscellaneous 

Sec. 151. Office of Consumer Advocacy. 

Sec. 152. Clean technology business competition grant program. 

Sec. 153. Product carbon disclosure program. 

Sec. 154. State recycling programs. 

Sec. 155. Supplemental agriculture, abandoned mine land, and forestry greenhouse gas reduction and renewable energy program. 

Sec. 156. Economic Development Climate Change Fund. 

‘‘Sec. 219. Economic Development Climate Change Fund. 

Sec. 157. Study of risk-based programs addressing vulnerable areas. 

Sec. 158. Efficient Buildings Program. 

Subtitle F—Energy Efficiency and Renewable Energy 

Sec. 161. Renewable energy. 

Sec. 162. Advanced biofuels. 

Sec. 163. Energy efficiency in building codes. 

Sec. 164. Retrofit for energy and environmental performance. 

Sec. 165. Certified stoves program. 

Sec. 166. Renewable fuel standard. 

Sec. 167. Tree planting programs. 

Subtitle G—Emission Reductions From Public Transportation Vehicles 

Sec. 171. Short title. 

Sec. 172. State fuel economy regulation for taxicabs. 

Sec. 173. State regulation of motor vehicle emissions for taxicabs. 

Subtitle H—Clean Energy and Natural Gas 

Sec. 181. Clean Energy and Accelerated Emission Reduction Program. 

Sec. 182. Advanced natural gas technologies. 

TITLE II—RESEARCH 

Subtitle A—Energy Research 

Sec. 201. Advanced energy research. 

Subtitle B—Drinking Water Adaptation, Technology, Education, and Research 

Sec. 211. Effects of climate change on drinking water utilities. 


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TITLE III—TRANSITION AND ADAPTATION 

Subtitle A—Green Jobs and Worker Transition 

PART 1—GREEN JOBS

Sec. 301. Clean energy curriculum development grants. 

Sec. 302. Development of Information and Resources clearinghouse for vocational 

education and job training in renewable energy sectors. 

Sec. 303. Green construction careers demonstration project. 

PART 2—CLIMATE CHANGE WORKER ADJUSTMENT ASSISTANCE

Sec. 311. Petitions, eligibility requirements, and determinations. 

Sec. 312. Program benefits. 

Sec. 313. General provisions. 

Subtitle B—International Climate Change Programs 

Sec. 321. Strategic Interagency Board on International Climate Investment. 

Sec. 322. Emission reductions from reduced deforestation. 

‘‘PART E—SUPPLEMENTAL EMISSION REDUCTIONS

‘‘Sec. 751. Definitions. 

‘‘Sec. 752. Purposes. 

‘‘Sec. 753. Emission reductions from reduced deforestation. 

Sec. 323. International Clean Energy Deployment Program. 

Sec. 324. International climate change adaptation and global security program. 

Sec. 325. Evaluation and reports. 

Sec. 326. Report on climate actions of major economies. 

Subtitle C—Adapting to Climate Change 

PART 1—DOMESTIC ADAPTATION

SUBPART A—NATIONAL CLIMATE CHANGE ADAPTATION PROGRAM

Sec. 341. National Climate Change Adaptation Program. 

Sec. 342. Climate services. 

SUBPART B—PUBLIC HEALTH AND CLIMATE CHANGE

Sec. 351. Sense of Congress on public health and climate change. 

Sec. 352. Relationship to other laws. 

Sec. 353. National strategic action plan. 

Sec. 354. Advisory board. 

Sec. 355. Reports. 

Sec. 356. Definitions. 

SUBPART C—CLIMATE CHANGE SAFEGUARDS FOR NATURAL RESOURCES

CONSERVATION

Sec. 361. Purposes. 

Sec. 362. Natural resources climate change adaptation policy. 

Sec. 363. Definitions. 

Sec. 364. Council on Environmental Quality. 

Sec. 365. Natural Resources Climate Change Adaptation Panel. 

Sec. 366. Natural Resources Climate Change Adaptation Strategy. 


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Sec. 367. Natural resources adaptation science and information. 

Sec. 368. Federal natural resource agency adaptation plans. 

Sec. 369. State natural resources adaptation plans. 

Sec. 370. Natural Resources Climate Change Adaptation Account. 

Sec. 371. National Fish and Wildlife Habitat and Corridors Information Program. 

Sec. 372. Additional provisions regarding Indian tribes. 

SUBPART D—ADDITIONAL CLIMATE CHANGE ADAPTATION PROGRAMS

Sec. 381. Water system mitigation and adaptation partnerships. 

Sec. 382. Flood control, protection, prevention, and response. 

Sec. 383. Wildfire. 

Sec. 384. Coastal and Great Lakes State adaptation program. 

DIVISION B—POLLUTION REDUCTION AND INVESTMENT 

TITLE I—REDUCING GLOBAL WARMING POLLUTION 

Subtitle A—Reducing Global Warming Pollution 

Sec. 101. Reducing global warming pollution. 

‘‘TITLE VII—GLOBAL WARMING POLLUTION REDUCTION AND 

INVESTMENT PROGRAM 

‘‘PART A—GLOBAL WARMING POLLUTION REDUCTION GOALS AND TARGETS

‘‘Sec. 701. Findings. 

‘‘Sec. 702. Economywide reduction goals. 

‘‘Sec. 703. Reduction targets for specified sources. 

‘‘Sec. 704. Supplemental pollution reductions. 

‘‘Sec. 705. Review and program recommendations. 

‘‘Sec. 706. National Academy review. 

‘‘Sec. 707. Presidential response and recommendations. 

‘‘Sec. 708. Consultation with States. 

‘‘PART B—DESIGNATION AND REGISTRATION OF GREENHOUSE GASES

‘‘Sec. 711. Designation of greenhouse gases. 

‘‘Sec. 712. Carbon dioxide equivalent value of greenhouse gases. 

‘‘Sec. 713. Greenhouse gas registry. 

‘‘Sec. 714. Perfluorocarbon and other nonhydrofluorocarbon fluorinated substance production regulation. 

‘‘PART C—PROGRAM RULES

‘‘Sec. 721. Emission allowances. 

‘‘Sec. 722. Prohibition of excess emissions. 

‘‘Sec. 723. Penalty for noncompliance. 

‘‘Sec. 724. Trading. 

‘‘Sec. 725. Banking and borrowing. 

‘‘Sec. 726. Market Stability Reserve. 

‘‘Sec. 727. Permits. 

‘‘Sec. 728. International emission allowances. 


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‘‘PART D—OFFSETS

‘‘Sec. 731. Offsets Integrity Advisory Board. 

‘‘Sec. 732. Establishment of offsets program. 

‘‘Sec. 733. Eligible project types. 

‘‘Sec. 734. Requirements for offset projects. 

‘‘Sec. 735. Approval of offset projects. 

‘‘Sec. 736. Verification of offset projects. 

‘‘Sec. 737. Issuance of offset credits. 

‘‘Sec. 738. Audits. 

‘‘Sec. 739. Program review and revision. 

‘‘Sec. 740. Early offset supply. 

‘‘Sec. 741. Environmental considerations. 

‘‘Sec. 742. Trading. 

‘‘Sec. 743. Office of Offsets Integrity. 

‘‘Sec. 744. International offset credits. 

Sec. 102. Definitions. 

‘‘Sec. 700. Definitions. 

Sec. 103. Offset reporting requirements. 

Subtitle B—Disposition of Allowances 

Sec. 111. Disposition of allowances for global warming pollution reduction program. 

‘‘PART G—DISPOSITION OF ALLOWANCES

‘‘Sec. 771. Allocation of emission allowances. 

‘‘Sec. 772. Electricity consumers. 

‘‘Sec. 773. Natural gas consumers. 

‘‘Sec. 774. Home heating oil and propane consumers. 

‘‘Sec. 775. Domestic fuel production. 

‘‘Sec. 776. Consumer protection. 

‘‘Sec. 777. Exchange for State-issued allowances. 

‘‘Sec. 778. Auction procedures. 

‘‘Sec. 779. Auctioning allowances for other entities. 

‘‘Sec. 780. Commercial deployment of carbon capture and permanent sequestration technologies. 

‘‘Sec. 781. Oversight of allocations. 

‘‘Sec. 782. Early action recognition. 

‘‘Sec. 783. Establishment of Deficit Reduction Fund. 

Subtitle C—Additional Greenhouse Gas Standards 

Sec. 121. Greenhouse gas standards. 

‘‘TITLE VIII—ADDITIONAL GREENHOUSE GAS STANDARDS 

‘‘Sec. 801. Definitions. 

‘‘PART A—STATIONARY SOURCE STANDARDS

‘‘Sec. 811. Standards of performance. 

Sec. 122. HFC regulation. 

‘‘Sec. 619. Hydrofluorocarbons (HFCs). 

Sec. 123. Black carbon. 


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‘‘PART E—BLACK CARBON

‘‘Sec. 851. Black carbon. 

Sec. 124. States. 

Sec. 125. State programs. 

‘‘PART F—MISCELLANEOUS

‘‘Sec. 861. State programs. 

‘‘Sec. 862. Grants for support of air pollution control programs. 

‘‘Sec. 863. Reducing acid rain and mercury pollution. 

Sec. 126. Enforcement. 

Sec. 127. Forestry sector greenhouse gas accounting. 

Sec. 128. Conforming amendments. 

‘‘Sec. 508. Emissions of greenhouse gases. 

Sec. 129. Davis-Bacon compliance. 

Subtitle D—Carbon Market Assurance 

Sec. 131. Carbon market assurance. 

Subtitle E—Ensuring Real Reductions in Industrial Emissions 

Sec. 141. Ensuring real reductions in industrial emissions. 

‘‘PART F—ENSURING REAL REDUCTIONS IN INDUSTRIAL EMISSIONS

‘‘Sec. 761. Purposes. 

‘‘Sec. 762. Definitions. 

‘‘Sec. 763. Eligible industrial sectors. 

‘‘Sec. 764. Distribution of emission allowance rebates. 

‘‘Sec. 765. International trade. 

TITLE II—PROGRAM ALLOCATIONS 

Sec. 201. Distribution of allowances for investment in clean vehicles. 

‘‘Sec. 795A. Black carbon reduction grant program. 

Sec. 202. State and local investment in energy efficiency and renewable energy. 

Sec. 203. Energy efficiency in building codes. 

Sec. 204. Energy Innovation Hubs. 

Sec. 205. ARPA–E research. 

Sec. 206. International clean energy deployment program. 

Sec. 207. International climate change adaptation and global security. 

Sec. 208. Energy efficiency and renewable energy worker training. 

Sec. 209. Worker transition. 

Sec. 210. State programs for greenhouse gas reduction and climate adaptation. 

Sec. 211. Climate Change Health Protection and Promotion Fund. 

Sec. 212. Climate change safeguards for natural resources conservation. 

Sec. 213. Nuclear worker training. 

Sec. 214. Supplemental agriculture, abandoned mine land, renewable energy, and 

forestry. 

Sec. 215. Investment in greenhouse gas reductions from the transportation sector. 

Sec. 216. State programs for natural resource adaptation activities. 

1 SEC. 2. FINDINGS. 

2 Congress finds that— 


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1 (1) the United States can take back control of the 

2 energy future of the United States, strengthen eco3 nomic competitiveness, safeguard the health of fami4 lies and the environment, and ensure the national se5 curity, of the United States by increasing energy 

6 independence; 

7 (2) creating a clean energy future requires a 

8 comprehensive approach that includes support for the 

9 improvement of all energy sources, including coal, 

10 natural gas, nuclear power, and renewable genera11 tion; 

12 (3) efficiency in the energy sector also represents 

13 a critical avenue to reduce energy consumption and 

14 carbon pollution, and those benefits can be captured 

15 while generating additional savings for consumers; 

16 (4) substantially increasing the investment in 

17 the clean energy future of the United States will pro18 vide economic opportunities to millions of people in 

19 the United States and drive future economic growth 

20 in this country; 

21 (5) the United States is responsible for many of 

22 the initial scientific advances in clean energy tech23 nology, but, as of September 2009, the United States 

24 has only 5 of the top 30 leading companies in solar, 

25 wind, and advanced battery technology; 


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1 (6) investment in the clean energy sector will 

2 allow companies in the United States to retake a 

3 leadership position, and the jobs created by those in4 vestments will significantly accelerate growth in do5 mestic manufacturing; 

6 (7) those opportunities also will result in sub7 stantial employment gains in construction, a sector 

8 in which the median hourly wage is 17 percent higher 

9 than the national median; 

10 (8) those jobs are distributed throughout the 

11 United States, and the highest clean energy economy 

12 employment growth rates in the last 10 years were in 

13 the States of Idaho, Nebraska, South Dakota, Oregon, 

14 and New Mexico; 

15 (9) focusing on clean energy will dramatically 

16 reduce pollution and significantly improve the health 

17 of families in and the environment of the United 

18 States; 

19 (10) moving to a low-carbon economy must pro20 tect the most vulnerable populations in the United 

21 States, including low-income families that are par22 ticularly affected by volatility in energy prices; 

23 (11) if unchecked, the impact of climate change 

24 will include widespread effects on health and welfare, 

25 including— 


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1 (A) increased outbreaks from waterborne 

2 diseases; 

3 (B) more droughts; 

4 (C) diminished agricultural production; 

5 (D) severe storms and floods; 

6 (E) heat waves; 

7 (F) wildfires; and 

8 (G) a substantial rise in sea levels, due in 

9 part to— 

10 (i) melting mountain glaciers; 

11 (ii) shrinking sea ice; and 

12 (iii) thawing permafrost; 

13 (12) the most recent science indicates that the 

14 changes described in paragraph (11)(G) are occurring 

15 faster and with greater intensity than expected; 

16 (13) military officials, including retired admi17 rals and generals, concur with the intelligence com18 munity that climate change acts as a threat multi19 plier for instability and presents significant national 

20 security challenges for the United States; 

21 (14) massive portions of the infrastructure of the 

22 United States, including critical military infrastruc23 ture, are at risk from the effects of climate change; 


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1 (15) impacts are already being felt in local com2 munities within the United States as well as by at3 risk populations abroad; 

4 (16) the Declaration of the Leaders from the 

5 Major Economies Forum on Energy and Climate, 

6 representing 17 of the largest economies in the world, 

7 recognizes the need to limit the increase in global av8 erage temperatures to within 2 degrees Centigrade, as 

9 a necessary step to prevent the catastrophic con10 sequences of climate change; and 

11 (17) the United States should lead the global 

12 community in combating the threat of global climate 

13 change and reaching a robust international agreement 

14 to address global warming under the United Nations 

15 Framework Convention on Climate Change, done at 

16 New York on May 9, 1992 (or a successor agreement). 

17 SEC. 3. ECONOMYWIDE EMISSION REDUCTION GOALS. 

18 The goals of this Act and the amendments made by 

19 this Act are to reduce steadily the quantity of United States 

20 greenhouse gas emissions such that— 

21 (1) in 2012, the quantity of United States green22 house gas emissions does not exceed 97 percent of the 

23 quantity of United States greenhouse gas emissions in 

24 2005; 


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1 (2) in 2020, the quantity of United States green2 house gas emissions does not exceed 80 percent of the 

3 quantity of United States greenhouse gas emissions in 

4 2005; 

5 (3) in 2030, the quantity of United States green6 house gas emissions does not exceed 58 percent of the 

7 quantity of United States greenhouse gas emissions in 

8 2005; and 

9 (4) in 2050, the quantity of United States green10 house gas emissions does not exceed 17 percent of the 

11 quantity of United States greenhouse gas emissions in 

12 2005. 

13 SEC. 4. DEFINITIONS. 

14 In this Act: 

15 (1) ADMINISTRATOR.—The term ‘‘Adminis16 trator’’ means the Administrator of the Environ17 mental Protection Agency. 

18 (2) INDIAN TRIBE.—The term ‘‘Indian tribe’’ has 

19 the meaning given the term in section 302 of the 

20 Clean Air Act (42 U.S.C. 7602). 

21 (3) STATE.—The term ‘‘State’’ has the meaning 

22 given that term in section 302 of the Clean Air Act 

23 (42 U.S.C. 7602). 


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1 DIVISION A—AUTHORIZATIONS 

2 FOR POLLUTION REDUCTION, 

3 TRANSITION, AND ADAPTA4 TION 

5 SEC. 101. STRUCTURE OF ACT. 

6 (a) AUTHORIZED AND ALLOCATED PROGRAMS.—The 

7 following programs authorized under this division are eligi8 ble to receive an allocation under title VII of the Clean Air 

9 Act: 

10 (1) The program for greenhouse gas emission re11 ductions through transportation efficiency under part 

12 C of title VIII the Clean Air Act (as added by sections 

13 112 and 113 of this division) and section 215 of divi14 sion B. 

15 (2) The program for nuclear worker training 

16 under section 132 of this division and 213 of division 

17 B. 

18 (3) State recycling programs under section 154 

19 of this division and section 210 of division B. 

20 (4) The supplemental agriculture and forestry 

21 greenhouse gas reduction and renewable energy pro22 gram under section 155 of this division and section 

23 214 of division B. 


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1 (5) The program for energy efficiency in build2 ing codes under section 163 of this division and sec3 tion 203 of division B. 

4 (6) The program for retrofit for energy and envi5 ronmental performance under section 164 of this divi6 sion. 

7 (7) The program for worker transition under 

8 part 2 of subtitle A of title III of this division and 

9 section 209 of division B. 

10 (8) The program for public health and climate 

11 change under subpart B of part 1 of subtitle C of title 

12 III of this division and section 211 of division B. 

13 (9) The program for climate change safeguards 

14 for natural resources conservation under subpart C of 

15 part 1 of subtitle C of title III of this division, sec16 tions 212 and 216 of division B, including— 

17 (A) State programs for natural resource ad18 aptation under section 370(a)(1) of division A, 

19 and section 216 of division B; and 

20 (B) the Natural Resources Climate Change 

21 Adaptation Account under paragraphs (2) 

22 through (6) of section 370(a) of division A, and 

23 section 212 of division B. 


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1 (10) The program for emission reductions from 

2 reduced deforestation under section 753 of the Clean 

3 Air Act (as added by section 322 of this division). 

4 (11) The International Clean Energy Deploy5 ment Program under section 323 of this division and 

6 section 206 of division B. 

7 (12) The international climate change adapta8 tion and global security program under 324 of this 

9 division and section 207 of division B. 

10 (13) The program for water system mitigation 

11 and adaptation partnerships under section 381 of this 

12 division and section 210 of division B. 

13 (14) The program for flood control, protection, 

14 prevention, and response under section 382 of this di15 vision and section 210 of division B. 

16 (15) The program for wildfire under section 383 

17 of this division and section 210 of division B. 

18 (16) The Coastal and Great Lakes State Adapta19 tion Program under section 384 of this division and 

20 section 210 of division B. 

21 (b) ALLOCATED PROGRAMS.—The following alloca22 tions are provided under title VII of the Clean Air Act: 

23 (1) The Market Stability Reserve Fund under 

24 section 726 of the Clean Air Act (as added by section 

25 101 of division B). 


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1 (2) The program to ensure real reductions in in2 dustrial emissions under part F of title VII of the 

3 Clean Air Act (as added by section 141 of division 

4 B). 

5 (3) The program for electricity consumers pursu6 ant to section 772 of the Clean Air Act (as added by 

7 section 111 of division B). 

8 (4) The program for natural gas consumers pur9 suant to section 773 of the Clean Air Act (as added 

10 by section 111 of division B). 

11 (5) The program for home heating oil and pro12 pane consumers pursuant to section 774 of the Clean 

13 Air Act (as added by section 111 of division B). 

14 (6) The program for domestic fuel production, 

15 including petroleum refiners and small business refin16 ers, under section 775 of the Clean Air Act (as added 

17 by section 111 of division B). 

18 (7) The program for climate change consumer re19 funds and low- and moderate-income consumers pur20 suant to section 776 of the Clean Air Act (as added 

21 by section 111 of division B), including— 

22 (A) consumer rebates under section 776(a) 

23 of the Clean Air Act (as so added); and 

24 (B) energy refunds under section 776(b) of 

25 the Clean Air Act (as so added). 


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1 (8) The program for commercial deployment of 

2 carbon capture and storage technology under section 

3 780 of the Clean Air Act (as added by section 111 of 

4 division B). 

5 (9) The program for early action recognition 

6 pursuant to section 782 of the Clean Air Act (as 

7 added by section 111 of division B). 

8 (10) The program for investment in clean vehicle 

9 technology under section 201 of division B. 

10 (11) The program for State and local investment 

11 in energy efficiency and renewable energy under sec12 tion 202 of division B. 

13 (12) The program for Energy Innovation Hubs 

14 pursuant to section 204 of division B. 

15 (13) The program for ARPA–E research pursu16 ant to section 205 of division B. 

17 (14) The program for energy efficiency and re18 newable energy worker training under section 208 of 

19 division B. 

20 (15) The State programs for greenhouse gas re21 duction and climate adaptation pursuant to section 

22 210 of division B. 

23 (16) The program for greenhouse gas emission 

24 reductions from the transportation sector under sec25 tion 215 of division B. 


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1 (c) NONALLOCATED PROGRAMS.—The following pro2 grams are authorized under this division: 

3 (1) The SmartWay Transportation Efficiency 

4 Program under section 822 of the Clean Air Act (as 

5 added by section 114 of this division). 

6 (2) The carbon capture and sequestration dem7 onstration and early deployment program under sec8 tion 125 of this division. 

9 (3) The nuclear safety and waste management 

10 programs under section 133 of this division. 

11 (4) Water efficiency programs under subtitle D 

12 of title I of this division. 

13 (5) The Office of Consumer Advocacy under sec14 tion 151 of this division. 

15 (6) The clean technology business competition 

16 grant program under section 152 of this division. 

17 (7) The product carbon disclosure program 

18 under section 153 of this division. 

19 (8) The Economic Development Climate Change 

20 Fund under section 219 of the Public Works and Eco21 nomic Development Act of 1965 (as added by section 

22 156 of this division). 

23 (9) The program for renewable energy under sec24 tion 161 of this division. 


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1 (10) The program for advanced biofuels under 

2 section 162 of this division. 

3 (11) The program for emission reductions from 

4 public transportation vehicles under subtitle G of title 

5 I of this division. 

6 (12) The Clean Energy and Accelerated Emis7 sion Reduction Program under section 181 of this di8 vision. 

9 (13) The program for advanced natural gas tech10 nologies under section 182 of this division. 

11 (14) The program for advanced energy research 

12 under subtitle A of title II of this division. 

13 (15) The program for drinking water adapta14 tion, technology, education, and research under sub15 title B of title II of this division. 

16 (16) The program for clean energy curriculum 

17 development grants under section 301 of this division. 

18 (17) The program for Development of Informa19 tion and Resources clearinghouse for vocational edu20 cation and job training in renewable energy sectors 

21 under section 302 of this division. 

22 (18) The green construction careers demonstra23 tion project under section 303 of this division. 


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1 SEC. 102. REQUIREMENTS RELATING TO FEDERAL ADVI2 SORY COMMITTEES. 

3 (a) APPOINTMENT QUALIFICATIONS.—Each appoint4 ment of a member to an advisory committee established 

5 under this Act or an amendment made by this Act shall 

6 be— 

7 (1) based on the qualifications, competence, and 

8 experience of the member; and 

9 (2) except as otherwise required by Federal law 

10 (including regulations), made without regard to the 

11 political affiliation of the member. 

12 (b) DESIGNATION OF MEMBERS.— 

13 (1) IN GENERAL.—An individual appointed to 

14 serve on an advisory committee established under this 

15 Act or an amendment made by this Act who is not 

16 a full-time or permanent part-time officer or em17 ployee of the Federal Government shall be designated 

18 by the Federal department or agency to which the rel19 evant advisory committee reports as— 

20 (A) a special employee of the Federal Gov21 ernment, if the individual is providing advice 

22 based substantially on the expertise or experience 

23 of the individual; or 

24 (B) a representative, if the individual is 

25 substantially representing the views of individ26 uals or entities outside the Federal Government. 


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1 (2) REVIEWS.— 

2 (A) IN GENERAL.—The head of each Federal 

3 department or agency shall review the member4 ship of each advisory committee that reports to 

5 the department or agency— 

6 (i) to determine whether the designa7 tion of the members is appropriate; and 

8 (ii) if the designation of any member 

9 is not appropriate, to redesignate the mem10 ber. 

11 (B) TIMING.—A review under subparagraph 

12 (A) shall be conducted— 

13 (i) on the date on which the charter of 

14 the relevant advisory committee expires; or 

15 (ii) for any advisory committee with 

16 an indefinite charter, not less frequently 

17 than once every 2 years. 

18 (c) ENSURING INDEPENDENT ADVICE AND EXPER19 TISE.— 

20 (1) APPOINTMENT.—To the maximum extent 

21 practicable, except as provided in subsection 

22 (b)(1)(B), the head of each Federal department and 

23 agency shall appoint members of advisory committees 

24 established under this Act or an amendment made by 


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1 this Act as special employees of the Federal Govern2 ment. 

3 (2) ACTION BY AGENCY HEADS.—The head of 

4 each Federal department or agency shall ensure, to 

5 the maximum extent practicable, that— 

6 (A) no individual appointed to serve on an 

7 applicable advisory committee has a conflict of 

8 interest that is relevant to the functions to be 

9 performed by the individual, unless— 

10 (i) the conflict is promptly and pub11 licly disclosed; and 

12 (ii) the head of the department or 

13 agency determines that the conflict is un14 avoidable; and 

15 (B) each report of an applicable advisory 

16 committee— 

17 (i) is the result of the independent 

18 judgment of the advisory committee; and 

19 (ii) includes a statement indicating the 

20 process used by the advisory committee in 

21 formulating the recommendations or conclu22 sions contained in the report. 

23 (3) REQUIREMENT.—The head of each Federal 

24 department or agency shall require that individuals 

25 appointed or considered for appointment to serve on 


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1 an applicable advisory committee shall inform the 

2 head of any conflict of interest of the individual that 

3 is relevant to the advisory committee functions to be 

4 performed by the individual. 

5 (4) REPRESENTATIVE MEMBERS.—If the head of 

6 a Federal department or agency determines that a 

7 member described in subsection (b)(1)(B) is required 

8 to serve on an applicable advisory committee, the ad9 visory committee management officer of the depart10 ment or agency shall consult with the designated eth11 ics official of the department or agency to ensure that 

12 the designation of the member is appropriate and nec13 essary to fulfilling the purpose of the advisory com14 mittee. 

15 (5) ACTION BY ETHICS OFFICIALS.—The des16 ignated ethics official of each applicable Federal de17 partment or agency shall issue guidance to ensure 

18 that the applicable advisory committees are providing 

19 sufficiently independent advice and expertise. 

20 (6) REPORTS.—The Administrator of General 

21 Services shall— 

22 (A) conduct an annual review of compliance 

23 by Federal departments and agencies with the 

24 requirements of this subsection; and 


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1 (B) submit to the Committee on Environ2 ment and Public Works of the Senate and the 

3 Committee on Energy and Commerce of the 

4 House of Representatives annual reports describ5 ing the results of the reviews. 

6 (d) DISCLOSURE OF INFORMATION.— 

7 (1) ITEMS REQUIRED TO BE DISCLOSED.—The 

8 head of each Federal department or agency to which 

9 an advisory committee established under this Act or 

10 an amendment made by this Act reports shall make 

11 available as described in paragraph (2) the following 

12 information, at a minimum: 

13 (A) The charter of the advisory committee. 

14 (B) A description of the formation process 

15 of the advisory committee, including— 

16 (i) the process for identifying prospec17 tive members; 

18 (ii) the process of selecting members for 

19 balance of viewpoints or expertise; and 

20 (iii) a justification of the need for rep21 resentative members, if any. 

22 (C) A list of all current members of the ad23 visory committee, updated regularly, including, 

24 for each member— 


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1 (i) the name of any individual or enti2 ty that nominated the member; 

3 (ii) whether the member is designated 

4 as a special employee of the Federal Govern5 ment or a representative member; and 

6 (iii) in the case of a representative 

7 member, the individuals or entity the view8 point of which the member represents. 

9 (D) A list of all special employees of the 

10 Federal Government who have received conflict of 

11 interest waivers under section 208(b) of title 18, 

12 United States Code, pursuant to regulations pro13 mulgated by the Office of Government Ethics, a 

14 description of the conflict necessitating the waiv15 er, and the reason for granting the waiver. 

16 (E) A summary of the decisionmaking proc17 ess of the advisory committee. 

18 (F) A complete report of all meetings of the 

19 advisory committee. 

20 (G) Notices of future meetings of the advi21 sory committee. 

22 (2) METHODS OF DISCLOSURE.— 

23 (A) AVAILABILITY.— 

24 (i) IN GENERAL.—Subject to clause 

25 (ii), the information required to be disclosed 


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1 by a Federal department or agency under 

2 this subsection shall be made available elec3 tronically, including on the official public 

4 Internet website of the department or agen5 cy, not later than 7 calendar days before the 

6 applicable meeting of the advisory com7 mittee. 

8 (ii) COMPLETE REPORTS.—Each com9 plete report of a meeting of an advisory 

10 committee established under this Act or an 

11 amendment made by this Act— 

12 (I) shall be disclosed by the rel13 evant Federal department or agency 

14 under this subsection by not later than 

15 7 calendar days after the date of the 

16 meeting; and 

17 (II) may take the form of an elec18 tronic recording of the meeting, a tran19 script, or any other substantively com20 plete accounting of the meeting. 

21 (B) ACTION BY GSA.—The Administrator of 

22 General Services shall provide, on the official 

23 public Internet website of the General Services 

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1 tion made available by each Federal department 

2 or agency under subparagraph (A). 

3 SEC. 103. VOLUNTARY RENEWABLE ENERGY MARKETS. 

4 (a) FINDINGS.—Congress finds that— 

5 (1) voluntary renewable energy markets can be 

6 efficient and effective programs for allowing con7 sumers and businesses to voluntarily use or support 

8 renewable energy; 

9 (2) more than 1,000,000 businesses, households, 

10 government agencies, farms, and others voluntarily 

11 purchase renewable electricity or renewable energy 

12 certificates; and 

13 (3) according to the Department of Energy— 

14 (A) voluntary renewable energy purchases 

15 totaled 24,000,000,000 kilowatt-hours during cal16 endar year 2008, representing 0.6 percent of 

17 total United States electricity sales; and 

18 (B) voluntary renewable energy purchases 

19 have increased at an average annual rate of 32 

20 percent since calendar year 2004. 

21 (b) STATEMENT OF POLICY.—It is the policy of the 

22 United States— 

23 (1) to support the continued growth of voluntary 

24 renewable energy markets; and 


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1 (2) that nothing in this Act or the amendments 

2 made by this Act is intended to interfere with or pre3 vent the continued operation and growth of the vol4 untary renewable energy market. 

5 (c) REPORT TO CONGRESS.—Not later than 2 years 

6 after the date of enactment of this Act, the Comptroller Gen7 eral of the United States shall submit to Congress a report 

8 describing the efficacy of the voluntary renewable energy 

9 market in the context of the pollution reduction and invest10 ment programs under this Act and the amendments made 

11 by this Act, including— 

12 (1) whether meaningful reductions in carbon di13 oxide emissions have occurred in response to invest14 ments in the voluntary renewable energy market; 

15 (2) whether the voluntary market continues to 

16 grow; and 

17 (3) a list of recommended strategies for ensuring 

18 that— 

19 (A) meaningful emissions reductions may 

20 occur; and 

21 (B) the voluntary renewable energy market 

22 may continue to grow. 


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1 TITLE I—GREENHOUSE GAS 

2 REDUCTION PROGRAMS 

3 Subtitle A—Clean Transportation 

4 SEC. 111. EMISSION STANDARDS. 

5 Title VIII of the Clean Air Act (as added by section 

6 121 of division B) is amended by adding at the end the 

7 following: 

8 ‘‘PART B—MOBILE SOURCES 

9 ‘‘SEC. 821. GREENHOUSE GAS EMISSION STANDARDS FOR 

10 MOBILE SOURCES. 

11 ‘‘(a) NEW MOTOR VEHICLES AND NEW MOTOR VEHI12 CLE ENGINES.—(1) Pursuant to section 202(a)(1), by De13 cember 31, 2010, the Administrator shall promulgate stand14 ards applicable to emissions of greenhouse gases from new 

15 heavy-duty motor vehicles or new heavy-duty motor vehicle 

16 engines, excluding such motor vehicles covered by the Tier 

17 II standards (as established by the Administrator as of the 

18 date of the enactment of this section). The Administrator 

19 may revise these standards from time to time. 

20 ‘‘(2) Regulations issued under section 202(a)(1) appli21 cable to emissions of greenhouse gases from new heavy-duty 

22 motor vehicles or new heavy-duty motor vehicle engines, ex23 cluding such motor vehicles covered by the Tier II standards 

24 (as established by the Administrator as of the date of the 

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1 flect the greatest degree of emissions reduction achievable 

2 through the application of technology which the Adminis3 trator determines will be available for the model year to 

4 which such standards apply, giving appropriate consider5 ation to cost, energy, and safety factors associated with the 

6 application of such technology. Any such regulations shall 

7 take effect after such period as the Administrator finds nec8 essary to permit the development and application of the req9 uisite technology, and, at a minimum, shall apply for a 

10 period no less than 3 model years beginning no earlier than 

11 the model year commencing 4 years after such regulations 

12 are promulgated. 

13 ‘‘(3) Regulations issued under section 202(a)(1) appli14 cable to emissions of greenhouse gases from new heavy-duty 

15 motor vehicles or new heavy-duty motor vehicle engines, ex16 cluding such motor vehicles covered by the Tier II standards 

17 (as established by the Administrator as of the date of the 

18 enactment of this section), shall supersede and satisfy any 

19 and all of the rulemaking and compliance requirements of 

20 section 32902(k) of title 49, United States Code. 

21 ‘‘(4) Other than as specifically set forth in paragraph 

22 (3) of this subsection, nothing in this section shall affect 

23 or otherwise increase or diminish the authority of the Sec24 retary of Transportation to adopt regulations to improve 


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1 the overall fuel efficiency of the commercial goods movement 

2 system. 

3 ‘‘(b) NONROAD VEHICLES AND ENGINES.—(1) Pursu4 ant to section 213(a)(4) and (5), the Administrator shall 

5 identify those classes or categories of new nonroad vehicles 

6 or engines, or combinations of such classes or categories, 

7 that, in the judgment of the Administrator, both contribute 

8 significantly to the total emissions of greenhouse gases from 

9 nonroad engines and vehicles, and provide the greatest po10 tential for significant and cost-effective reductions in emis11 sions of greenhouse gases. The Administrator shall promul12 gate standards applicable to emissions of greenhouse gases 

13 from these new nonroad engines or vehicles by December 

14 31, 2012. The Administrator shall also promulgate stand15 ards applicable to emissions of greenhouse gases for such 

16 other classes and categories of new nonroad vehicles and en17 gines as the Administrator determines appropriate and in 

18 the timeframe the Administrator determines appropriate. 

19 The Administrator shall base such determination, among 

20 other factors, on the relative contribution of greenhouse gas 

21 emissions, and the costs for achieving reductions, from such 

22 classes or categories of new nonroad engines and vehicles. 

23 The Administrator may revise these standards from time 

24 to time. 


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1 ‘‘(2) Standards under section 213(a)(4) and (5) appli2 cable to emissions of greenhouse gases from those classes or 

3 categories of new nonroad engines or vehicles identified in 

4 the first sentence of paragraph (1) of this subsection, shall 

5 achieve the greatest degree of emissions reduction achievable 

6 based on the application of technology which the Adminis7 trator determines will be available at the time such stand8 ards take effect, taking into consideration cost, energy, and 

9 safety factors associated with the application of such tech10 nology. Any such regulations shall take effect at the earliest 

11 possible date after such period as the Administrator finds 

12 necessary to permit the development and application of the 

13 requisite technology, giving appropriate consideration to 

14 the cost of compliance within such period, the applicable 

15 compliance dates for other standards, and other appropriate 

16 factors, including the period of time appropriate for the 

17 transfer of applicable technology from other applications, 

18 including motor vehicles, and the period of time in which 

19 previously promulgated regulations have been in effect. 

20 ‘‘(3) For purposes of this section and standards under 

21 section 213(a)(4) or (5) applicable to emissions of green22 house gases, the term ‘nonroad engines and vehicles’ shall 

23 include non-internal combustion engines and the vehicles 

24 these engines power (such as electric engines and electric 

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1 hicles which would be in the same category and have the 

2 same uses as nonroad engines and vehicles that are powered 

3 by internal combustion engines. 

4 ‘‘(c) AVERAGING, BANKING, AND TRADING OF EMIS5 SIONS CREDITS.—In establishing standards applicable to 

6 emissions of greenhouse gases pursuant to this section and 

7 sections 202(a), 213(a)(4) and (5), and 231(a), the Admin8 istrator may establish provisions for averaging, banking, 

9 and trading of greenhouse gas emissions credits within or 

10 across classes or categories of motor vehicles and motor vehi11 cle engines, nonroad vehicles and engines (including marine 

12 vessels), and aircraft and aircraft engines, to the extent the 

13 Administrator determines appropriate and considering the 

14 factors appropriate in setting standards under those sec15 tions. Such provisions may include reasonable and appro16 priate provisions concerning generation, banking, trading, 

17 duration, and use of credits. 

18 ‘‘(d) REPORTS.—The Administrator shall, from time 

19 to time, submit a report to Congress that projects the 

20 amount of greenhouse gas emissions from the transportation 

21 sector, including transportation fuels, for the years 2030 

22 and 2050, based on the standards adopted under this sec23 tion. 


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1 ‘‘(e) GREENHOUSE GASES.—Notwithstanding the pro2 visions of section 711, hydrofluorocarbons shall be consid3 ered a greenhouse gas for purposes of this section.’’. 

4 SEC. 112. GREENHOUSE GAS EMISSION REDUCTIONS 

5 THROUGH TRANSPORTATION EFFICIENCY. 

6 (a) ENVIRONMENTAL PROTECTION AGENCY.—Title 

7 VIII of the Clean Air Act (as amended by section 111 of 

8 this division) is amended by adding at the end the fol9 lowing: 

10 ‘‘PART C—TRANSPORTATION EMISSIONS 

11 ‘‘SEC. 831. GREENHOUSE GAS EMISSION REDUCTIONS 

12 THROUGH TRANSPORTATION EFFICIENCY. 

13 ‘‘(a) IN GENERAL.—The Administrator, in consulta14 tion with the Secretary of Transportation (referred to in 

15 this part as the ‘Secretary’), shall promulgate, and update 

16 from time to time, regulations to establish— 

17 ‘‘(1) national transportation-related greenhouse 

18 gas emission reduction goals that are commensurate 

19 with the emission reduction goals established under 

20 the Clean Energy Jobs and American Power Act and 

21 amendments made by that Act; 

22 ‘‘(2) standardized emission models and related 

23 methods, to be used by States, metropolitan planning 

24 organizations, and air quality agencies to address 

25 emission reduction goals, including— 


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1 ‘‘(A) the development of surface transpor2 tation-related greenhouse gas emission reduction 

3 targets pursuant to sections 134 and 135 of title 

4 23, and sections 5303 and 5304 of title 49, 

5 United States Code; 

6 ‘‘(B) the assessment of projected surface 

7 transportation-related greenhouse gas emissions 

8 from transportation strategies; 

9 ‘‘(C) the assessment of projected surface 

10 transportation-related greenhouse gas emissions 

11 from State and regional transportation plans; 

12 ‘‘(D) the establishment of surface transpor13 tation-related greenhouse gas emission baselines 

14 at a national, State, and regional levels; and 

15 ‘‘(E) the measurement and assessment of ac16 tual surface transportation-related emissions to 

17 assess progress toward achievement of emission 

18 targets at the State and regional levels; 

19 ‘‘(3) methods for collection of data on transpor20 tation-related greenhouse gas emissions; and 

21 ‘‘(4) publication and distribution of successful 

22 strategies employed by States, Indian tribes, metro23 politan planning organizations, and other entities to 

24 reduce transportation-related greenhouse gas emis25 sions. 


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1 ‘‘(b) ROLE OF DEPARTMENT OF TRANSPORTATION.— 

2 The Secretary, in consultation with the Administrator, 

3 shall promulgate, and update from time to time, regula4 tions— 

5 ‘‘(1) to improve the ability of transportation 

6 planning models and tools, including travel demand 

7 models, to address greenhouse gas emissions; 

8 ‘‘(2) to assess projected surface transportation-re9 lated travel activity and transportation strategies 

10 from State and regional transportation plans; and 

11 ‘‘(3) to update transportation planning require12 ments and approval of transportation plans as nec13 essary to carry out this section. 

14 ‘‘(c) CONSULTATION AND MODELS.—In promulgating 

15 the regulations, the Administrator and the Secretary— 

16 ‘‘(1) shall consult with States, Indian tribes, 

17 metropolitan planning organizations, and air quality 

18 agencies; 

19 ‘‘(2) may use existing models and methodologies 

20 if the models and methodologies are widely considered 

21 to reflect the best practicable modeling or methodo22 logical approach for assessing actual and projected 

23 transportation-related greenhouse gas emissions from 

24 transportation plans and projects; and 


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1 ‘‘(3) shall consider previously developed plans 

2 that were based on models and methodologies for re3 ducing greenhouse gas emissions in applying those 

4 regulations to the first approvals after promulgation. 

5 ‘‘(d) TIMING.—The Administrator and the Secretary 

6 shall— 

7 ‘‘(1) publish proposed regulations under sub8 sections (a) and (b) not later than 1 year after the 

9 date of enactment of this section; and 

10 ‘‘(2) promulgate final regulations under sub11 sections (a) and (b) not later than 18 months after 

12 the date of enactment of this section. 

13 ‘‘(e) ASSESSMENT.— 

14 ‘‘(1) IN GENERAL.—At least every 6 years after 

15 promulgating final regulations under subsections (a) 

16 and (b), the Administrator and the Secretary shall 

17 jointly assess current and projected progress in reduc18 ing national transportation-related greenhouse gas 

19 emissions. 

20 ‘‘(2) REQUIREMENTS.—The assessment shall ex21 amine the contributions to emission reductions attrib22 utable to— 

23 ‘‘(A) improvements in vehicle efficiency; 

24 ‘‘(B) greenhouse gas performance of trans25 portation fuels; 


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1 ‘‘(C) reductions in vehicle miles traveled; 

2 ‘‘(D) changes in consumer demand and use 

3 of transportation management systems; and 

4 ‘‘(E) any other greenhouse gas-related 

5 transportation policies enacted by Congress. 

6 ‘‘(3) RESULTS OF ASSESSMENT.—The Secretary 

7 and the Administrator shall consider— 

8 ‘‘(A) the results of the assessment conducted 

9 under this subsection; and 

10 ‘‘(B) based on those results, whether tech11 nical or other updates to regulations required 

12 under this section and sections 134 and 135 of 

13 title 23, and sections 5303 and 5304 of title 49, 

14 United States Code, are necessary.’’. 

15 (b) METROPOLITAN PLANNING ORGANIZATIONS.— 

16 (1) TITLE 23.—Section 134 of title 23, United 

17 States Code, is amended— 

18 (A) in subsection (a)(1)— 

19 (i) by striking ‘‘minimizing’’ and in20 serting ‘‘reducing’’; and 

21 (ii) by inserting ‘‘, reliance on oil, im22 pacts on the environment, transportation23 related greenhouse gas emissions,’’ after 

24 ‘‘consumption’’; 

25 (B) in subsection (h)(1)(E)— 


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1 (i) by inserting ‘‘sustainability, and 

2 livability, reduce surface transportation-re3 lated greenhouse gas emissions and reliance 

4 on oil, adapt to the effects of climate 

5 change,’’ after ‘‘energy conservation,’’; 

6 (ii) by inserting ‘‘and public health’’ 

7 after ‘‘quality of life’’; and 

8 (iii) by inserting ‘‘, including housing 

9 and land use patterns’’ after ‘‘development 

10 patterns’’; 

11 (C) in subsection (i)— 

12 (i) in paragraph (4)(A)— 

13 (I) by striking ‘‘consult, as appro14 priate,’’ and inserting ‘‘cooperate’’; 

15 (II) by inserting ‘‘transportation, 

16 public transportation, air quality, and 

17 housing, and shall consult, as appro18 priate, with State and local agencies 

19 and Indian tribes responsible for’’ after 

20 ‘‘responsible for’’ and 

21 (III) by inserting ‘‘public health,’’ 

22 after ‘‘conservation,’’; and 

23 (ii) in paragraph (5)(C)(iii), by in24 serting ‘‘and through the website of the met25 ropolitan planning organization, including 


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1 emission reduction targets and strategies de2 veloped under subsection (k)(6), including 

3 an analysis of the anticipated effects of the 

4 targets and strategies,’’ after ‘‘World Wide 

5 Web’’; and 

6 (D) in subsection (k), by adding at the end 

7 the following: 

8 ‘‘(6) TRANSPORTATION GREENHOUSE GAS RE9 DUCTION EFFORTS.— 

10 ‘‘(A) IN GENERAL.—Within a metropolitan 

11 planning area serving a transportation manage12 ment area, the transportation planning process 

13 under this section shall address transportation14 related greenhouse gas emissions by including 

15 emission reduction targets and strategies to meet 

16 those targets. 

17 ‘‘(B) ELIGIBLE ORGANIZATIONS.— 

18 ‘‘(i) MPOS WITHIN TMAS.—All provi19 sions and requirements of this section, in20 cluding the requirements of the transpor21 tation greenhouse gas reduction efforts, shall 

22 apply to metropolitan planning organiza23 tions that also serve as transportation man24 agement areas. 


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1 ‘‘(ii) OTHER MPOS.—A metropolitan 

2 planning organization that does not serve 

3 as a transportation management area— 

4 ‘‘(I) may develop transportation 

5 greenhouse gas emission reduction tar6 gets and strategies to meet those tar7 gets; and 

8 ‘‘(II) if those targets and strate9 gies are developed, shall be subject to 

10 all applicable provisions and require11 ments of this section and the Clean 

12 Energy Jobs and American Power Act, 

13 including requirements of the transpor14 tation greenhouse gas reduction efforts. 

15 ‘‘(C) ESTABLISHMENT OF TARGETS AND

16 CRITERIA.— 

17 ‘‘(i) IN GENERAL.—Not later than 2 

18 years after the promulgation of the final 

19 regulations required under section 831 of 

20 the Clean Air Act, each metropolitan plan21 ning organization that also serves as a 

22 transportation management area shall de23 velop surface transportation-related green24 house gas emission reduction targets, as well 

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1 sultation with State air agencies and In2 dian tribes as part of the metropolitan 

3 transportation planning process under this 

4 section. 

5 ‘‘(ii) MULTIPLE DESIGNATIONS.—If 

6 more than 1 metropolitan planning organi7 zation has been designated within a metro8 politan area, each metropolitan planning 

9 organization shall coordinate with other 

10 metropolitan planning organizations in the 

11 same metropolitan area to develop the tar12 gets and strategies described in clause (i). 

13 ‘‘(iii) MINIMUM REQUIREMENTS.— 

14 Each metropolitan transportation plan de15 veloped by a metropolitan planning organi16 zation under clause (i) shall, within the 

17 plan, demonstrate progress in stabilizing 

18 and reducing transportation-related green19 house gas emissions so as to contribute to 

20 the achievement of State targets pursuant to 

21 section 135(f)(9). 

22 ‘‘(iv) REQUIREMENTS FOR TARGETS

23 AND STRATEGIES.—The targets and strate24 gies developed under this subparagraph 

25 shall, at a minimum— 


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1 ‘‘(I) be based on the emission and 

2 travel demand models and related 

3 methodologies established in the final 

4 regulations required under section 831 

5 of the Clean Air Act; 

6 ‘‘(II) inventory all sources of sur7 face transportation-related greenhouse 

8 gas emissions; 

9 ‘‘(III) apply to those modes of 

10 surface transportation that are ad11 dressed in the planning process under 

12 this section; 

13 ‘‘(IV) be integrated and consistent 

14 with regional transportation plans and 

15 transportation improvement programs; 

16 and 

17 ‘‘(V) be selected through scenario 

18 analysis, and include, pursuant to the 

19 requirements of the transportation 

20 planning process under this section, 

21 transportation investment and man22 agement strategies that reduce green23 house gas emissions from the transpor24 tation sector over the life of the plan, 

25 such as— 


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1 ‘‘(aa) efforts to increase pub2 lic transportation ridership, in3 cluding through service improve4 ments, capacity expansions, and 

5 access enhancement; 

6 ‘‘(bb) efforts to increase walk7 ing, bicycling, and other forms of 

8 nonmotorized transportation; 

9 ‘‘(cc) implementation of zon10 ing and other land use regulations 

11 and plans to support infill, tran12 sit-oriented development, redevel13 opment, or mixed use develop14 ment; 

15 ‘‘(dd) travel demand man16 agement programs (including car17 pool, vanpool, or car-share 

18 projects), transportation pricing 

19 measures, parking policies, and 

20 programs to promote telecom21 muting, flexible work schedules, 

22 and satellite work centers; 

23 ‘‘(ee) surface transportation 

24 system operation improvements, 

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1 tation systems or other oper2 ational improvements to reduce 

3 long-term greenhouse gas emis4 sions through reduced congestion 

5 and improved system manage6 ment; 

7 ‘‘(ff) intercity passenger rail 

8 improvements; 

9 ‘‘(gg) intercity bus improve10 ments; 

11 ‘‘(hh) freight rail improve12 ments; 

13 ‘‘(ii) use of materials or 

14 equipment associated with the 

15 construction or maintenance of 

16 transportation projects that re17 duce greenhouse gas emissions; 

18 ‘‘(jj) public facilities for sup19 plying electricity to electric or 

20 plug-in hybrid-electric vehicles; or 

21 ‘‘(kk) any other effort that 

22 demonstrates progress in reducing 

23 transportation-related greenhouse 

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1 tan planning organization under 

2 this subsection. 

3 ‘‘(D) REVIEW AND APPROVAL.—Not later 

4 than 180 days after the date of submission of a 

5 plan under this section— 

6 ‘‘(i) the Secretary and the Adminis7 trator shall review the plan; and 

8 ‘‘(ii) the Secretary shall make a deter9 mination that the plan submitted by a met10 ropolitan planning organization meets the 

11 requirements of subparagraph (C) if— 

12 ‘‘(I) the Secretary finds that a 

13 metropolitan planning organization 

14 has developed, submitted, and pub15 lished the plan of the metropolitan 

16 planning organization pursuant to this 

17 section; 

18 ‘‘(II) the Secretary, in consulta19 tion with the Administrator, deter20 mines that the plan is likely to achieve 

21 the targets established by the metro22 politan planning organization under 

23 this subsection; and 

24 ‘‘(III) the development of the plan 

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1 ments established under clauses (iii) 

2 and (iv) of subparagraph (C). 

3 ‘‘(E) CERTIFICATION.— 

4 ‘‘(i) IN GENERAL.—Only metropolitan 

5 planning organizations that meet the re6 quirements of subparagraph (C) shall be eli7 gible to receive performance grants under 

8 section 113(c). 

9 ‘‘(ii) FAILURE TO COMPLY.—Failure to 

10 comply with the requirements under sub11 paragraph (C) shall not impact certifi12 cation standards under paragraph (5). 

13 ‘‘(7) DEFINITION OF METROPOLITAN PLANNING

14 ORGANIZATION.—In this subsection, the term ‘metro15 politan planning organization’ means a metropolitan 

16 planning organization described in clause (i) or (ii) 

17 of paragraph (6)(B). 

18 ‘‘(8) SCENARIO ANALYSIS.—The term ‘scenario 

19 analysis’ means the use of a planning tool that— 

20 ‘‘(A) develops a range of scenarios rep21 resenting various combinations of transportation 

22 and land use strategies, and estimates of how 

23 each of those scenarios would perform in meeting 

24 the greenhouse gas emission reduction targets 

25 based on analysis of various forces (such as 


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1 health, transportation, economic or environ2 mental factors, and land use) that affect growth; 

3 ‘‘(B) may include features such as— 

4 ‘‘(i) the involvement of the general pub5 lic, key stakeholders, and elected officials on 

6 a broad scale; 

7 ‘‘(ii) the creation of an opportunity for 

8 those participants to educate each other as 

9 to growth trends and trade-offs, as a means 

10 to incorporate values and feedback into fu11 ture plans; and 

12 ‘‘(iii) the use of continuing efforts and 

13 ongoing processes; and 

14 ‘‘(C) may include key elements such as— 

15 ‘‘(i) identification of the driving forces 

16 behind planning decisions and outcomes; 

17 ‘‘(ii) determination of patterns of 

18 interaction; 

19 ‘‘(iii) creation of scenarios for discus20 sion purposes; 

21 ‘‘(iv) analysis of implications; 

22 ‘‘(v) evaluation of scenarios; and 

23 ‘‘(vi) use of monitoring indicators.’’. 

24 (2) TITLE 49.—Section 5303 of title 49, United 

25 States Code, is amended— 


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1 (A) in subsection (a)(1)— 

2 (i) by striking ‘‘minimizing’’ and in3 serting ‘‘reducing’’; and 

4 (ii) by inserting ‘‘, reliance on oil, im5 pacts on the environment, transportation6 related greenhouse gas emissions,’’ after 

7 ‘‘consumption’’; 

8 (B) in subsection (h)(1)(E)— 

9 (i) by inserting ‘‘sustainability, and 

10 livability, reduce surface transportation-re11 lated greenhouse gas emissions and reliance 

12 on oil, adapt to the effects of climate 

13 change,’’ after ‘‘energy conservation,’’; 

14 (ii) by inserting ‘‘and public health’’ 

15 after ‘‘quality of life’’; and 

16 (iii) by inserting ‘‘, including housing 

17 and land use patterns’’ after ‘‘development 

18 patterns’’; 

19 (C) in subsection (i)— 

20 (i) in paragraph (4)(A)— 

21 (I) by striking ‘‘consult, as appro22 priate,’’ and inserting ‘‘cooperate’’; 

23 (II) by inserting ‘‘transportation, 

24 public transportation, air quality, and 

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1 priate, with State and local agencies 

2 and Indian tribes responsible for’’ after 

3 ‘‘responsible for’’ and 

4 (III) by inserting ‘‘public health,’’ 

5 after ‘‘conservation,’’; and 

6 (ii) in paragraph (5)(C)(iii), by in7 serting ‘‘and through the website of the met8 ropolitan planning organization, including 

9 emission reduction targets and strategies de10 veloped under subsection (k)(6), including 

11 an analysis of the anticipated effects of the 

12 targets and strategies,’’ after ‘‘World Wide 

13 Web’’; and 

14 (D) in subsection (k), by adding at the end 

15 the following: 

16 ‘‘(6) TRANSPORTATION GREENHOUSE GAS RE17 DUCTION EFFORTS.— 

18 ‘‘(A) IN GENERAL.—Within a metropolitan 

19 planning area serving a transportation manage20 ment area, the transportation planning process 

21 under this section shall address transportation22 related greenhouse gas emissions by including 

23 emission reduction targets and strategies to meet 

24 those targets. 

25 ‘‘(B) ELIGIBLE ORGANIZATIONS.— 


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1 ‘‘(i) IN GENERAL.—The requirements 

2 of the transportation greenhouse gas reduc3 tion efforts shall apply only to metropolitan 

4 planning organizations within a transpor5 tation management area. 

6 ‘‘(ii) DEVELOPMENT OF PLAN.—A met7 ropolitan planning organization that does 

8 not serve as a transportation management 

9 area— 

10 ‘‘(I) may develop transportation 

11 greenhouse gas emission reduction tar12 gets and strategies to meet those tar13 gets; and 

14 ‘‘(II) if those targets and strate15 gies are developed, shall be subject to 

16 all provisions and requirements of this 

17 section, including requirements of the 

18 transportation greenhouse gas reduc19 tion efforts. 

20 ‘‘(C) ESTABLISHMENT OF TARGETS AND

21 CRITERIA.— 

22 ‘‘(i) IN GENERAL.—Not later than 2 

23 years after the promulgation of the final 

24 regulations required under section 831 of 

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1 ning organization shall develop surface 

2 transportation-related greenhouse gas emis3 sion reduction targets, as well as strategies 

4 to meet those targets, in consultation with 

5 State air agencies and Indian tribes as part 

6 of the metropolitan transportation planning 

7 process under this section. 

8 ‘‘(ii) MULTIPLE DESIGNATIONS.—If 

9 more than 1 metropolitan planning organi10 zation has been designated within a metro11 politan area, each metropolitan planning 

12 organization shall coordinate with other 

13 metropolitan planning organizations in the 

14 same metropolitan area to develop the tar15 gets and strategies described in clause (i). 

16 ‘‘(iii) MINIMUM REQUIREMENTS.— 

17 Each metropolitan transportation plan de18 veloped by a metropolitan planning organi19 zation under clause (i) shall, within the 

20 plan, demonstrate progress in stabilizing 

21 and reducing transportation-related green22 house gas emissions so as to contribute to 

23 the achievement of State targets pursuant to 

24 section 135(f)(9) of title 23. 


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1 ‘‘(iv) REQUIREMENTS FOR TARGETS

2 AND STRATEGIES.—The targets and strate3 gies developed under this subparagraph 

4 shall, at a minimum— 

5 ‘‘(I) be based on the emission 

6 models and related methodologies estab7 lished in the final regulations required 

8 under section 831 of the Clean Air Act; 

9 ‘‘(II) inventory all sources of sur10 face transportation-related greenhouse 

11 gas emissions; 

12 ‘‘(III) apply to those modes of 

13 surface transportation that are ad14 dressed in the planning process under 

15 this section; 

16 ‘‘(IV) be integrated and consistent 

17 with regional transportation plans and 

18 transportation improvement programs; 

19 and 

20 ‘‘(V) be selected through scenario 

21 analysis (as defined in section 134(k) 

22 of title 23), and include, pursuant to 

23 the requirements of the transportation 

24 planning process under this section, 

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1 agement strategies that reduce green2 house gas emissions from the transpor3 tation sector over the life of the plan, 

4 such as— 

5 ‘‘(aa) efforts to increase pub6 lic transportation ridership, in7 cluding through service improve8 ments, capacity expansions, and 

9 access enhancement; 

10 ‘‘(bb) efforts to increase walk11 ing, bicycling, and other forms of 

12 nonmotorized transportation; 

13 ‘‘(cc) implementation of zon14 ing and other land use regulations 

15 and plans to support infill, tran16 sit-oriented development, redevel17 opment, or mixed use develop18 ment; 

19 ‘‘(dd) travel demand man20 agement programs (including car21 pool, vanpool, or car-share 

22 projects), transportation pricing 

23 measures, parking policies, and 

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1 muting, flexible work schedules, 

2 and satellite work centers; 

3 ‘‘(ee) surface transportation 

4 system operation improvements, 

5 including intelligent transpor6 tation systems or other oper7 ational improvements to reduce 

8 long-term greenhouse gas emis9 sions through reduced congestion 

10 and improved system manage11 ment; 

12 ‘‘(ff) intercity passenger rail 

13 improvements; 

14 ‘‘(gg) intercity bus improve15 ments; 

16 ‘‘(hh) freight rail improve17 ments; 

18 ‘‘(ii) use of materials or 

19 equipment associated with the 

20 construction or maintenance of 

21 transportation projects that re22 duce greenhouse gas emissions; 

23 ‘‘(jj) public facilities for sup24 plying electricity to electric or 

25 plug-in hybrid-electric vehicles; or 


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1 ‘‘(kk) any other effort that 

2 demonstrates progress in reducing 

3 transportation-related greenhouse 

4 gas emissions in each metropoli5 tan planning organization under 

6 this subsection. 

7 ‘‘(D) REVIEW AND APPROVAL.—Not later 

8 than 180 days after the date of submission of a 

9 plan under this section— 

10 ‘‘(i) the Secretary and the Adminis11 trator shall review the plan; and 

12 ‘‘(ii) the Secretary shall make a deter13 mination that the plan submitted by a met14 ropolitan planning organization meets the 

15 requirements of subparagraph (C) if— 

16 ‘‘(I) the Secretary finds that a 

17 metropolitan planning organization 

18 has developed, submitted, and pub19 lished the plan of the metropolitan 

20 planning organization pursuant to this 

21 section; 

22 ‘‘(II) the Secretary, in consulta23 tion with the Administrator, deter24 mines that the plan is likely to achieve 

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1 politan planning organization under 

2 this subsection; and 

3 ‘‘(III) the development of the plan 

4 complies with the minimum require5 ments established under clauses (iii) 

6 and (iv) of subparagraph (C). 

7 ‘‘(E) CERTIFICATION.— 

8 ‘‘(i) IN GENERAL.—Only metropolitan 

9 planning organizations that meet the re10 quirements of subparagraph (C) shall be eli11 gible to receive performance grants under 

12 section 113(c). 

13 ‘‘(ii) FAILURE TO COMPLY.—Failure to 

14 comply with the requirements under sub15 paragraph (C) shall not impact certifi16 cation standards under paragraph (5). 

17 ‘‘(7) DEFINITION OF METROPOLITAN PLANNING

18 ORGANIZATION.—In this subsection, the term ‘metro19 politan planning organization’ means a metropolitan 

20 planning organization described in clause (i) or (ii) 

21 of paragraph (6)(B).’’. 

22 (c) STATES.— 

23 (1) TITLE 23.—Section 135 of title 23, United 

24 States Code, is amended— 

25 (A) in subsection (d)(1)(E)— 


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1 (i) by inserting ‘‘sustainability, and 

2 livability, reduce surface transportation-re3 lated greenhouse gas emissions and reliance 

4 on oil, adapt to the effects of climate 

5 change,’’ after ‘‘energy conservation,’’; 

6 (ii) by inserting ‘‘and public health’’ 

7 after ‘‘quality of life’’; and 

8 (iii) by inserting ‘‘, including housing 

9 and land use patterns’’ after ‘‘development 

10 patterns’’; and 

11 (B) in subsection (f)— 

12 (i) in paragraph (2)(D)(i)— 

13 (I) by striking ‘‘, as appropriate, 

14 in consultation’’ and inserting ‘‘in co15 operation’’; 

16 (II) by inserting ‘‘State and local 

17 agencies and Indian tribes responsible 

18 for transportation, public transpor19 tation, air quality, and housing and in 

20 consultation with’’ before ‘‘State, trib21 al’’; and 

22 (III) by inserting ‘‘public health,’’ 

23 after ‘‘conservation,’’; 

24 (ii) in paragraph (3)(B)(iii), by in25 serting ‘‘and through the website of the 


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1 State, including emission reduction targets 

2 and strategies developed under paragraph 

3 (9) and an analysis of the anticipated ef4 fects of the targets and strategies’’ after 

5 ‘‘World Wide Web’’; and 

6 (iii) by adding at the end the fol7 lowing: 

8 ‘‘(9) TRANSPORTATION GREENHOUSE GAS RE9 DUCTION EFFORTS.— 

10 ‘‘(A) IN GENERAL.—Within a State, the 

11 transportation planning process under this sec12 tion, shall address transportation-related green13 house gas emissions by including emission reduc14 tion targets and strategies to meet those targets. 

15 ‘‘(B) ESTABLISHMENT OF TARGETS AND

16 CRITERIA.— 

17 ‘‘(i) IN GENERAL.—Not later than 2 

18 years after the promulgation of the final 

19 regulations required under section 831 of 

20 the Clean Air Act, each State shall develop 

21 surface transportation-related greenhouse 

22 gas emission reduction targets, as well as 

23 strategies to meet those targets, in consulta24 tion with State air agencies and Indian 


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1 tribes as part of the transportation plan2 ning process under this section. 

3 ‘‘(ii) MINIMUM REQUIREMENTS.—Each 

4 transportation plan developed by a State 

5 under clause (i) shall, within the plan, dem6 onstrate progress in stabilizing and reduc7 ing transportation-related greenhouse gas 

8 emissions in the State so as to contribute to 

9 the achievement of national goals pursuant 

10 to section 831(a)(1) of the Clean Air Act. 

11 ‘‘(iii) REQUIREMENTS FOR TARGETS

12 AND STRATEGIES.—The targets and strate13 gies developed under this subparagraph 

14 shall, at a minimum— 

15 ‘‘(I) be based on the emission 

16 models and related methodologies estab17 lished in the final regulations required 

18 under section 831 of the Clean Air Act; 

19 ‘‘(II) inventory all sources of sur20 face transportation-related greenhouse 

21 gas emissions; 

22 ‘‘(III) apply to those modes of 

23 surface transportation that are ad24 dressed in the planning process under 

25 this section; 


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1 ‘‘(IV) be integrated and consistent 

2 with statewide transportation plans 

3 and statewide transportation improve4 ment programs; and 

5 ‘‘(V) be selected through scenario 

6 analysis (as defined in section 134(k)), 

7 and include, pursuant to the require8 ments of the transportation planning 

9 process under this section, transpor10 tation investment and management 

11 strategies that reduce greenhouse gas 

12 emissions from the transportation sec13 tor over the life of the plan, such as— 

14 ‘‘(aa) efforts to increase pub15 lic transportation ridership, in16 cluding through service improve17 ments, capacity expansions, and 

18 access enhancement; 

19 ‘‘(bb) efforts to increase walk20 ing, bicycling, and other forms of 

21 nonmotorized transportation; 

22 ‘‘(cc) implementation of zon23 ing and other land use regulations 

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1 opment, or mixed use develop2 ment; 

3 ‘‘(dd) travel demand man4 agement programs (including car5 pool, vanpool, or car-share 

6 projects), transportation pricing 

7 measures, parking policies, and 

8 programs to promote telecom9 muting, flexible work schedules, 

10 and satellite work centers; 

11 ‘‘(ee) surface transportation 

12 system operation improvements, 

13 including intelligent transpor14 tation systems or other oper15 ational improvements to reduce 

16 congestion and improve system 

17 management; 

18 ‘‘(ff) intercity passenger rail 

19 improvements; 

20 ‘‘(gg) intercity bus improve21 ments; 

22 ‘‘(hh) freight rail improve23 ments; 

24 ‘‘(ii) use of materials or 

25 equipment associated with the 


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1 construction or maintenance of 

2 transportation projects that re3 duce greenhouse gas emissions; 

4 ‘‘(jj) public facilities for sup5 plying electricity to electric or 

6 plug-in hybrid-electric vehicles; or 

7 ‘‘(kk) any other effort that 

8 demonstrates progress in reducing 

9 transportation-related greenhouse 

10 gas emissions. 

11 ‘‘(C) COORDINATION AND CONSULTATION

12 WITH PUBLIC AGENCIES.—Transportation green13 house gas targets and plans pursuant to this sec14 tion shall be developed— 

15 ‘‘(i) in coordination with— 

16 ‘‘(I) all metropolitan planning or17 ganizations covered by this section 

18 within the State; and 

19 ‘‘(II) transportation and air qual20 ity agencies within the State; 

21 ‘‘(ii) in consultation with representa22 tives of State and local housing, economic 

23 development, and land use agencies; and 

24 ‘‘(iii) in consultation with Indian 

25 tribes contiguous to the State. 


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1 ‘‘(D) ENFORCEMENT.—Not later than 180 

2 days after the date of submission of a plan under 

3 this section— 

4 ‘‘(i) the Secretary and the Adminis5 trator shall review the plan; and 

6 ‘‘(ii) the Secretary shall make a deter7 mination that the plan submitted by a 

8 State meets the requirements of subpara9 graph (B) if— 

10 ‘‘(I) the Secretary finds that a 

11 State has developed, submitted, and 

12 published the plan pursuant to this 

13 section; 

14 ‘‘(II) the Secretary, in consulta15 tion with the Administrator, deter16 mines that the plan is likely to achieve 

17 the targets established by the State 

18 under this subsection; and 

19 ‘‘(III) the development of the plan 

20 complies with the minimum require21 ments established under clauses (ii) 

22 and (iii) of subparagraph (B). 

23 ‘‘(E) PLANNING FINDING.— 

24 ‘‘(i) IN GENERAL.—Only States that 

25 meet the requirements of subparagraph (B) 


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1 shall be eligible to receive performance 

2 grants under section 113(c). 

3 ‘‘(ii) FAILURE TO COMPLY.—Failure to 

4 comply with the requirements under sub5 paragraph (B) shall not impact the plan6 ning finding under subsection (g)(7).’’. 

7 (2) TITLE 49.—Section 5304 of title 49, United 

8 States Code is amended— 

9 (A) in subsection (d)(1)(E)— 

10 (i) by inserting ‘‘sustainability, and 

11 livability, reduce surface transportation-re12 lated greenhouse gas emissions and reliance 

13 on oil, adapt to the effects of climate 

14 change,’’ after ‘‘energy conservation,’’; 

15 (ii) by inserting ‘‘and public health’’ 

16 after ‘‘quality of life’’; and 

17 (iii) by inserting ‘‘, including housing 

18 and land use patterns’’ after ‘‘development 

19 patterns’’; and 

20 (B) in subsection (f)— 

21 (i) in paragraph (2)(D)(i)— 

22 (I) by striking ‘‘, as appropriate, 

23 in consultation’’ and inserting ‘‘in co24 operation’’; 


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1 (II) by inserting ‘‘State and local 

2 agencies and Indian tribes responsible 

3 for transportation, public transpor4 tation, air quality, and housing and in 

5 consultation with’’ before ‘‘State, trib6 al’’; and 

7 (III) by inserting ‘‘public health,’’ 

8 after ‘‘conservation,’’; 

9 (ii) in paragraph (3)(B)(iii), by in10 serting ‘‘and through the website of the 

11 State, including emission reduction targets 

12 and strategies developed under paragraph 

13 (9) and an analysis of the anticipated ef14 fects of the targets and strategies’’ after 

15 ‘‘World Wide Web’’; and 

16 (iii) by adding at the end the fol17 lowing: 

18 ‘‘(9) TRANSPORTATION GREENHOUSE GAS RE19 DUCTION EFFORTS.— 

20 ‘‘(A) IN GENERAL.—Within a State, the 

21 transportation planning process under this sec22 tion, shall address transportation-related green23 house gas emissions by including emission reduc24 tion targets and strategies to meet those targets. 


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1 ‘‘(B) ESTABLISHMENT OF TARGETS AND

2 CRITERIA.— 

3 ‘‘(i) IN GENERAL.—Not later than 2 

4 years after the promulgation of the final 

5 regulations required under section 831 of 

6 the Clean Air Act, each State shall develop 

7 surface transportation-related greenhouse 

8 gas emission reduction targets, as well as 

9 strategies to meet those targets, in consulta10 tion with State air agencies and Indian 

11 tribes as part of the transportation plan12 ning process under this section. 

13 ‘‘(ii) MINIMUM REQUIREMENTS.—Each 

14 transportation plan developed by a State 

15 under clause (i) shall, within the plan, dem16 onstrate progress in stabilizing and reduc17 ing transportation-related greenhouse gas 

18 emissions in the State so as to contribute to 

19 the achievement of national targets pursu20 ant to section 831(a)(1) of the Clean Air 

21 Act. 

22 ‘‘(iii) REQUIREMENTS FOR TARGETS

23 AND STRATEGIES.—The targets and strate24 gies developed under this subparagraph 

25 shall, at a minimum— 


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1 ‘‘(I) be based on the emission 

2 models and related methodologies estab3 lished in the final regulations required 

4 under section 831 of the Clean Air Act; 

5 ‘‘(II) inventory all sources of sur6 face transportation-related greenhouse 

7 gas emissions; 

8 ‘‘(III) apply to those modes of 

9 surface transportation that are ad10 dressed in the planning process under 

11 this section; 

12 ‘‘(IV) be integrated and consistent 

13 with statewide transportation plans 

14 and statewide transportation improve15 ment programs; and 

16 ‘‘(V) be selected through scenario 

17 analysis (as defined in section 134(k) 

18 of title 23), and include, pursuant to 

19 the requirements of the transportation 

20 planning process under this section, 

21 transportation investment and man22 agement strategies that reduce green23 house gas emissions from the transpor24 tation sector over the life of the plan, 

25 such as— 


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1 ‘‘(aa) efforts to increase pub2 lic transportation ridership, in3 cluding through service improve4 ments, capacity expansions, and 

5 access enhancement; 

6 ‘‘(bb) efforts to increase walk7 ing, bicycling, and other forms of 

8 nonmotorized transportation; 

9 ‘‘(cc) implementation of zon10 ing and other land use regulations 

11 and plans to support infill, tran12 sit-oriented development, redevel13 opment, or mixed use develop14 ment; 

15 ‘‘(dd) travel demand man16 agement programs (including car17 pool, vanpool, or car-share 

18 projects), transportation pricing 

19 measures, parking policies, and 

20 programs to promote telecom21 muting, flexible work schedules, 

22 and satellite work centers; 

23 ‘‘(ee) surface transportation 

24 system operation improvements, 

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1 tation systems or other oper2 ational improvements to reduce 

3 congestion and improve system 

4 management; 

5 ‘‘(ff) intercity passenger rail 

6 improvements; 

7 ‘‘(gg) intercity bus improve8 ments; 

9 ‘‘(hh) freight rail improve10 ments; 

11 ‘‘(ii) use of materials or 

12 equipment associated with the 

13 construction or maintenance of 

14 transportation projects that re15 duce greenhouse gas emissions; 

16 ‘‘(jj) public facilities for sup17 plying electricity to electric or 

18 plug-in hybrid-electric vehicles; or 

19 ‘‘(kk) any other effort that 

20 demonstrates progress in reducing 

21 transportation-related greenhouse 

22 gas emissions. 

23 ‘‘(C) COORDINATION AND CONSULTATION

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1 house gas targets and plans pursuant to this sec2 tion shall be developed— 

3 ‘‘(i) in coordination with— 

4 ‘‘(I) all metropolitan planning or5 ganizations covered by this section 

6 within the State; and 

7 ‘‘(II) transportation and air qual8 ity agencies within the State; 

9 ‘‘(ii) in consultation with representa10 tives of State and local housing, economic 

11 development, and land use agencies; and 

12 ‘‘(iii) in consultation with Indian 

13 tribes contiguous to the State. 

14 ‘‘(D) ENFORCEMENT.—Not later than 180 

15 days after the date of submission of a plan under 

16 this section— 

17 ‘‘(i) the Secretary and the Adminis18 trator shall review the plan; and 

19 ‘‘(ii) the Secretary shall make a deter20 mination that the plan submitted by a 

21 State meets the requirements of subpara22 graph (B) if— 

23 ‘‘(I) the Secretary finds that a 

24 State has developed, submitted, and 


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1 published the plan pursuant to this 

2 section; 

3 ‘‘(II) the Secretary, in consulta4 tion with the Administrator, deter5 mines that the plan is likely to achieve 

6 the targets established by the State 

7 under this subsection; and 

8 ‘‘(III) the development of the plan 

9 complies with the minimum require10 ments established under clauses (ii) 

11 and (iii) of subparagraph (B). 

12 ‘‘(E) PLANNING FINDING.— 

13 ‘‘(i) IN GENERAL.—Only States that 

14 meet the requirements of subparagraph (B) 

15 shall be eligible to receive performance 

16 grants under section 113(c). 

17 ‘‘(ii) FAILURE TO COMPLY.—Failure to 

18 comply with the requirements under sub19 paragraph (B) shall not impact the plan20 ning finding under subsection (g)(7).’’. 

21 (d) APPLICABILITY.—Section 304 of the Clean Air Act 

22 (42 U.S.C. 7604) shall not apply to the planning provisions 

23 of this section or any amendment made by this section. 

24 (e) LAND USE AUTHORITY.—Nothing in this section 

25 or an amendment made by this section— 


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1 (1) infringes on the existing authority of local 

2 governments to plan or control land use; or 

3 (2) provides or transfers authority over land use 

4 to any other entity. 

5 SEC. 113. TRANSPORTATION GREENHOUSE GAS EMISSION 

6 REDUCTION PROGRAM GRANTS. 

7 Part C of title VIII of the Clean Air Act (as amended 

8 by section 112) is amended by adding at the end the fol9 lowing: 

10 ‘‘SEC. 832. TRANSPORTATION GREENHOUSE GAS EMISSION 

11 REDUCTION PROGRAM GRANTS. 

12 ‘‘(a) IN GENERAL.—The Secretary of Transportation 

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

14 grants to States and metropolitan planning organizations 

15 to carry out the purposes of this section for each fiscal 

16 year— 

17 ‘‘(1) to support the developing and updating of 

18 transportation greenhouse gas reduction targets and 

19 strategies; and 

20 ‘‘(2) to provide financial assistance to implement 

21 plans approved pursuant to— 

22 ‘‘(A) sections 134(k)(6) and 135(f)(9) of 

23 title 23, United States Code; and 

24 ‘‘(B) sections 5303(k)(6) and 5304(f)(9) of 

25 title 49, United States Code. 


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1 ‘‘(b) PLANNING GRANTS.— 

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

3 Secretary shall allocate not more than 10 percent of 

4 the funds available to carry out this section for a fis5 cal year for metropolitan planning organizations to 

6 develop and update transportation plans, including 

7 targets and strategies for greenhouse gas emission re8 duction under— 

9 ‘‘(A) sections 134(k)(6) and 135(f)(9) of 

10 title 23, United States Code; and 

11 ‘‘(B) sections 5303(k)(6) and 5304(f)(9) of 

12 title 49, United States Code. 

13 ‘‘(2) ELIGIBLE ORGANIZATIONS.—The Secretary 

14 shall distribute the funds available in (1) to metro15 politan planning organizations (as defined in section 

16 134(k)(7) of title 23, United States Code) in the pro17 portion that— 

18 ‘‘(A) the population within such a metro19 politan planning organization; bears to 

20 ‘‘(B) the total population of all such metro21 politan planning organizations. 

22 ‘‘(c) PERFORMANCE GRANTS.— 

23 ‘‘(1) IN GENERAL.—After allocating funds pursu24 ant to subsection (b)(1), and subject to subsection (h), 

25 the Secretary shall use the remainder of amounts 


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1 made available to carry out this section to provide 

2 grants to States and metropolitan planning organiza3 tions. 

4 ‘‘(2) CRITERIA.—In providing grants under this 

5 subsection, the Secretary, in consultation with the Ad6 ministrator, shall develop criteria for providing the 

7 grants, taking into consideration, with respect to 

8 areas to be covered by the grants— 

9 ‘‘(A) the quantity of total greenhouse gas 

10 emissions to be reduced as a result of implemen11 tation of a plan, within a covered area, as deter12 mined by methods established under section 

13 831(a); 

14 ‘‘(B) the quantity of total greenhouse gas 

15 emissions to be reduced per capita as a result of 

16 implementation of a plan, within the covered 

17 area, as determined by methods established under 

18 section 831(a); 

19 ‘‘(C) the cost-effectiveness of reducing green20 house gas emissions during the life of the plan; 

21 ‘‘(D) progress toward achieving emission re22 ductions target established under— 

23 ‘‘(i) sections 134(k)(6) and 135(f)(9) of 

24 title 23, United States Code; and 


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1 ‘‘(ii) sections 5303(k)(6) and 

2 5304(f)(9) of title 49, United States Code; 

3 ‘‘(E) reductions in greenhouse gas emissions 

4 previously achieved by States and metropolitan 

5 planning organizations during the 5-year period 

6 beginning on the date of enactment of this Act; 

7 ‘‘(F) plans that increase transportation op8 tions and mobility, particularly for low-income 

9 individuals, minorities, the elderly, households 

10 without motor vehicles, cost-burdened households, 

11 and the disabled; and 

12 ‘‘(G) other factors, including innovative ap13 proaches, minimization of costs, and consider14 ation of economic development, revenue genera15 tion, consumer fuel cost-savings, and other eco16 nomic, environmental and health benefits, as the 

17 Secretary determines to be appropriate. 

18 ‘‘(d) REQUIREMENT FOR REDUCED EMISSIONS.—A 

19 performance grant under subsection (c) may be used only 

20 to fund strategies that demonstrate a reduction in green21 house gas emissions that is sustainable over the life of the 

22 applicable transportation plan. 

23 ‘‘(e) COST-SHARING.—The Federal share of the costs of 

24 a project receiving Federal financial assistance under this 

25 section shall be 80 percent. 


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1 ‘‘(f) COMPLIANCE WITH APPLICABLE LAWS.— 

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

3 project receiving funds under this section shall comply 

4 with all applicable Federal laws (including regula5 tions), including— 

6 ‘‘(A) subchapter IV of chapter 31 of title 40, 

7 United States Code; and 

8 ‘‘(B) applicable requirements of titles 23 

9 and 49, United States Code. 

10 ‘‘(2) ELIGIBILITY.—Project eligibility shall be 

11 determined in accordance with this section. 

12 ‘‘(3) DETERMINATION OF APPLICABLE MODAL

13 REQUIREMENTS.—The Secretary shall— 

14 ‘‘(A) have the discretion to designate the 

15 specific modal requirements that shall apply to 

16 a project; and 

17 ‘‘(B) be guided by the predominant modal 

18 characteristics of the project in the event that a 

19 project has cross-modal application. 

20 ‘‘(g) ADDITIONAL REQUIREMENTS.— 

21 ‘‘(1) IN GENERAL.—As a condition on the receipt 

22 of financial assistance under this section, the interests 

23 of public transportation employees affected by the as24 sistance shall be protected under arrangements that 

25 the Secretary of Labor determines— 


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1 ‘‘(A) to be fair and equitable; and 

2 ‘‘(B) to provide benefits equal to the benefits 

3 established under section 5333(b) of title 49, 

4 United States Code. 

5 ‘‘(2) WAGES AND BENEFITS.—Laborers and me6 chanics employed on projects funded with amounts 

7 made available under this section shall be paid wages 

8 and benefits not less than those determined by the 

9 Secretary of Labor under subchapter IV of chapter 31 

10 of title 40, United States Code, to be prevailing in the 

11 same locality. 

12 ‘‘(h) ADMINISTRATIVE EXPENSES.—Not more than 5 

13 percent of the funds made available to carry out this section 

14 may be used by the Secretary to pay the administrative 

15 expenses necessary to carry out this section for a fiscal year. 

16 ‘‘(i) MISCELLANEOUS.— 

17 ‘‘(1) ROAD-USE AND CONGESTION PRICING MEAS18 URES.—All projects funded by amounts made avail19 able under this section shall be eligible to receive 

20 amounts collected through road-use and congestion 

21 pricing measures. 

22 ‘‘(2) LIMITATIONS.—The Administrator may not 

23 approve any transportation plan for a project that 

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1 ment, and construction guidelines established by the 

2 Department of Transportation. 

3 ‘‘(3) SUBGRANTEES.—With the approval of the 

4 Secretary, recipients of funding under this section 

5 may enter into agreements providing for the transfer 

6 of funds to private transportation providers or non7 eligible public entities (such as local governments, air 

8 quality agencies, zoning commissions, special districts 

9 and transit agencies) that have statutory responsi10 bility or authority for actions necessary to implement 

11 the strategies pursuant to— 

12 ‘‘(A) sections 134(k)(6) and 135(f)(9) of 

13 title 23, United States Code; and 

14 ‘‘(B) sections 5303(k)(6) and 5304(f)(9) of 

15 title 49, United States Code.’’. 

16 SEC. 114. SMARTWAY TRANSPORTATION EFFICIENCY PRO17 GRAM. 

18 Part B of title VIII of the Clean Air Act (as amended 

19 by section 111) is amended by adding at the end the fol20 lowing: 

21 ‘‘SEC. 822. SMARTWAY TRANSPORTATION EFFICIENCY PRO22 GRAM. 

23 ‘‘(a) IN GENERAL.—There is established within the 

24 Environmental Protection Agency a SmartWay Transpor25 tation Efficiency Program to quantify, demonstrate, and 


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1 promote the benefits of technologies, products, fuels, and 

2 operational strategies that reduce petroleum consumption, 

3 air pollution, and greenhouse gas emissions from the mobile 

4 source sector. 

5 ‘‘(b) GENERAL DUTIES.—Under the program estab6 lished under this section, the Administrator shall carry out 

7 each of the following: 

8 ‘‘(1) Development of measurement protocols to 

9 evaluate the energy consumption and greenhouse gas 

10 impacts from technologies and strategies in the mobile 

11 source sector, including those for passenger transport 

12 and goods movement. 

13 ‘‘(2) Development of qualifying thresholds for 

14 certifying, verifying, or designating energy-efficient, 

15 low-greenhouse gas SmartWay technologies and strat16 egies for each mode of passenger transportation and 

17 goods movement. 

18 ‘‘(3) Development of partnership and recognition 

19 programs to promote best practices and drive demand 

20 for energy-efficient, low-greenhouse gas transportation 

21 performance. 

22 ‘‘(4) Promotion of the availability of, and en23 couragement of the adoption of, SmartWay certified 

24 or verified technologies and strategies, and publica25 tion of the availability of financial incentives, such as 


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1 assistance from loan programs and other Federal and 

2 State incentives. 

3 ‘‘(c) SMARTWAY TRANSPORT FREIGHT PARTNER4 SHIP.—The Administrator shall establish a SmartWay 

5 Transport Partnership program with shippers and carriers 

6 of goods to promote energy-efficient, low-greenhouse gas 

7 transportation. In carrying out such partnership, the Ad8 ministrator shall undertake each of the following: 

9 ‘‘(1) Verification of the energy and greenhouse 

10 gas performance of participating freight carriers, in11 cluding those operating rail, trucking, marine, and 

12 other goods movement operations. 

13 ‘‘(2) Publication of a comprehensive energy and 

14 greenhouse gas performance index of freight modes 

15 (including rail, trucking, marine, and other modes of 

16 transporting goods) and individual freight companies 

17 so that shippers can choose to deliver their goods more 

18 efficiently. 

19 ‘‘(3) Development of tools for— 

20 ‘‘(A) carriers to calculate their energy and 

21 greenhouse gas performance; and 

22 ‘‘(B) shippers to calculate the energy and 

23 greenhouse gas impacts of moving their products 

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1 porting their goods by different modes and cor2 porate carriers. 

3 ‘‘(4) Provision of recognition opportunities for 

4 participating shipper and carrier companies dem5 onstrating advanced practices and achieving superior 

6 levels of greenhouse gas performance. 

7 ‘‘(d) IMPROVING FREIGHT GREENHOUSE GAS PER8 FORMANCE DATABASES.—The Secretary of Transportation 

9 shall, in coordination with other appropriate agencies, de10 fine and collect data on the physical and operational char11 acteristics of the Nation’s truck population, with special 

12 emphasis on data related to energy efficiency and green13 house gas performance to inform the performance index 

14 published under subsection (c)(2) of this section, and other 

15 means of goods transport as necessary, at least every 5 

16 years. 

17 ‘‘(e) SMARTWAY PASSENGER TRANSPORT STUDY.— 

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

19 the date of enactment of this section, the Adminis20 trator shall submit to the Committee on Environment 

21 and Public Works of the Senate and the Committee on 

22 Energy and Commerce of the House of Representa23 tives a report that describes the results of a study of 

24 the commercial passenger carrier industry, including 


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1 tour, charter, intercity, commuter, and other pas2 senger operations. 

3 ‘‘(2) INCLUSIONS.—The study under paragraph 

4 (1) shall include— 

5 ‘‘(A) an identification of options for com6 mercial passenger carriers to promote energy-ef7 ficient, low-greenhouse gas emission transpor8 tation; and 

9 ‘‘(B) at the discretion of the Administrator, 

10 support for a partnership and recognition pro11 gram for those commercial passenger carrier 

12 companies that demonstrate and achieve superior 

13 levels of greenhouse gas emissions performance. 

14 ‘‘(f) ESTABLISHMENT OF FINANCING PROGRAM.—The 

15 Administrator shall establish a SmartWay Financing Pro16 gram to competitively award funding to eligible entities 

17 identified by the Administrator in accordance with the pro18 gram requirements in subsection (h). 

19 ‘‘(g) PURPOSES.—Under the SmartWay Financing 

20 Program, eligible entities shall— 

21 ‘‘(1) use funds awarded by the Administrator to 

22 provide flexible loan and/or lease terms that increase 

23 approval rates or lower the costs of loans and/or 

24 leases in accordance with guidance developed by the 

25 Administrator; 


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1 ‘‘(2) make such loans and/or leases available to 

2 public and private entities for the purpose of adopt3 ing low-greenhouse gas technologies or strategies for 

4 the mobile source sector that are designated by the 

5 Administrator; and 

6 ‘‘(3) use funds provided by the Administrator for 

7 electrification of freight transportation systems in 

8 major national goods movement corridors, giving pri9 ority to electrification of transportation systems in 

10 areas that are gateways for high volumes of inter11 national and national freight transport and require 

12 substantial criteria pollutant emission reductions in 

13 order to attain national ambient air quality stand14 ards. 

15 ‘‘(h) PROGRAM REQUIREMENTS.—The Administrator 

16 shall determine program design elements and requirements, 

17 including— 

18 ‘‘(1) the type of financial mechanism with which 

19 to award funding, in the form of grants and/or con20 tracts; 

21 ‘‘(2) the designation of eligible entities to receive 

22 funding, such as State, tribal, and local governments, 

23 regional organizations comprised of governmental 

24 units, nonprofit organizations, or for-profit compa25 nies; 


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1 ‘‘(3) criteria for evaluating applications from el2 igible entities, including anticipated— 

3 ‘‘(A) cost-effectiveness of loan or lease pro4 gram on a metric-ton-of-greenhouse gas-saved5 per-dollar basis; and 

6 ‘‘(B) ability to promote the loan or lease 

7 program and associated technologies and strate8 gies to the target audience; and 

9 ‘‘(4) reporting requirements for entities that re10 ceive awards, including— 

11 ‘‘(A) actual cost-effectiveness and greenhouse 

12 gas savings from the loan or lease program based 

13 on a methodology designated by the Adminis14 trator; 

15 ‘‘(B) the total number of applications and 

16 number of approved applications; and 

17 ‘‘(C) terms granted to loan and lease recipi18 ents compared to prevailing market practices 

19 and/or rates. 

20 ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—Such 

21 sums as necessary are authorized to be appropriated to the 

22 Administrator to carry out this section.’’. 


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1 Subtitle B—Carbon Capture and 

2 Sequestration 

3 SEC. 121. NATIONAL STRATEGY. 

4 (a) IN GENERAL.—Not later than 1 year after the date 

5 of enactment of this Act, the Administrator, in consultation 

6 with the Secretary of Energy, the Secretary of the Interior, 

7 and the heads of such other relevant Federal agencies as 

8 the President may designate, shall submit to Congress a re9 port establishing a unified and comprehensive strategy to 

10 address the key legal, regulatory, and other barriers to the 

11 commercial-scale deployment of carbon capture and storage. 

12 (b) BARRIERS.—The report under this section shall— 

13 (1) identify the regulatory, legal, and other gaps 

14 and barriers that— 

15 (A) could be addressed by a Federal agency 

16 using existing statutory authority; 

17 (B) require Federal legislation, if any; or 

18 (C) would be best addressed at the State, 

19 tribal, or regional level; 

20 (2) identify regulatory implementation chal21 lenges, including challenges relating to approval of 

22 State and tribal programs and delegation of author23 ity for permitting; and 


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1 (3) recommend rulemakings, Federal legislation, 

2 or other actions that should be taken to further evalu3 ate and address those barriers. 

4 (c) FINDING.—Congress finds that it is in the public 

5 interest to achieve widespread, commercial-scale deploy6 ment of carbon capture and storage in the United States 

7 and throughout Asia before January 1, 2030. 

8 SEC. 122. REGULATIONS FOR GEOLOGICAL SEQUESTRA9 TION SITES. 

10 (a) COORDINATED CERTIFICATION AND PERMITTING

11 PROCESS.—Part A of title VIII of the Clean Air Act (as 

12 amended by section 124 of this division) is amended by 

13 adding at the end the following: 

14 ‘‘SEC. 813. GEOLOGICAL STORAGE SITES. 

15 ‘‘(a) COORDINATED PROCESS.— 

16 ‘‘(1) IN GENERAL.—The Administrator shall es17 tablish a coordinated approach to certifying and per18 mitting geological storage, taking into consideration 

19 all relevant statutory authorities. 

20 ‘‘(2) REQUIREMENTS.—In establishing such ap21 proach, the Administrator shall— 

22 ‘‘(A) take into account, and reduce redun23 dancy with, the requirements of section 1421 of 

24 the Safe Drinking Water Act (42 U.S.C. 300h), 

25 including the rulemaking for geological storage 


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1 wells described in the proposed rule entitled ‘Fed2 eral Requirements Under the Underground Injec3 tion Control (UIC) Program for Carbon Dioxide 

4 (CO2) Geologic Sequestration (GS) Wells’ (73 

5 Fed. Reg. 43492 (July 25, 2008)); and 

6 ‘‘(B) to the maximum extent practicable, re7 duce the burden on certified entities and imple8 menting authorities. 

9 ‘‘(b) REGULATIONS.—Not later than 2 years after the 

10 date of enactment of this title, the Administrator shall pro11 mulgate regulations to protect human health and the envi12 ronment by minimizing the risk of escape to the atmosphere 

13 of carbon dioxide injected for purposes of geological storage. 

14 ‘‘(c) REQUIREMENTS.—The regulations under sub15 section (b) shall include— 

16 ‘‘(1) a process to obtain certification for geologi17 cal storage under this section; and 

18 ‘‘(2) requirements for— 

19 ‘‘(A) monitoring, recordkeeping, and report20 ing for emissions associated with injection into, 

21 and escape from, geological storage sites, taking 

22 into account any requirements or protocols devel23 oped under section 713; 

24 ‘‘(B) public participation in the certifi25 cation process that maximizes transparency; 


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1 ‘‘(C) the sharing of data among States, In2 dian tribes, and the Environmental Protection 

3 Agency; and 

4 ‘‘(D) other elements or safeguards necessary 

5 to achieve the purpose described in subsection 

6 (b). 

7 ‘‘(d) REPORT.— 

8 ‘‘(1) IN GENERAL.—Not later than 2 years after 

9 the date of promulgation of regulations pursuant to 

10 subsection (b), and not less frequently than once every 

11 3 years thereafter, the Administrator shall submit to 

12 the Committee on Energy and Commerce of the House 

13 of Representatives and the Committee on Environ14 ment and Public Works of the Senate a report de15 scribing geological storage in the United States, and, 

16 to the extent relevant, other countries in North Amer17 ica. 

18 ‘‘(2) INCLUSIONS.—Each report under para19 graph (1) shall include— 

20 ‘‘(A) data regarding injection, emissions to 

21 the atmosphere, if any, and performance of ac22 tive and closed geological storage sites, including 

23 those at which enhanced hydrocarbon recovery 

24 operations occur; 


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1 ‘‘(B) an evaluation of the performance of 

2 relevant Federal environmental regulations and 

3 programs in ensuring environmentally protective 

4 geological storage practices; 

5 ‘‘(C) recommendations on how those pro6 grams and regulations should be improved or 

7 made more effective; and 

8 ‘‘(D) other relevant information.’’. 

9 (b) SAFE DRINKING WATER ACT STANDARDS.—Sec10 tion 1421 of the Safe Drinking Water Act (42 U.S.C. 300h) 

11 is amended by adding at the end the following: 

12 ‘‘(e) CARBON DIOXIDE GEOLOGICAL STORAGE

13 WELLS.— 

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

15 the date of enactment of this subsection, the Adminis16 trator shall promulgate regulations under subsection 

17 (a) for carbon dioxide geological storage wells. 

18 ‘‘(2) FINANCIAL RESPONSIBILITY.— 

19 ‘‘(A) IN GENERAL.—The regulations under 

20 paragraph (1) shall include requirements for 

21 maintaining evidence of financial responsibility, 

22 including financial responsibility for emergency 

23 and remedial response, well plugging, site clo24 sure, and post-injection site care. 


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1 ‘‘(B) REGULATIONS.—Financial responsi2 bility may be established for carbon dioxide geo3 logical wells in accordance with regulations pro4 mulgated by the Administrator by any 1, or any 

5 combination, of the following: 

6 ‘‘(i) Insurance. 

7 ‘‘(ii) Guarantee. 

8 ‘‘(iii) Trust. 

9 ‘‘(iv) Standby trust. 

10 ‘‘(v) Surety bond. 

11 ‘‘(vi) Letter of credit. 

12 ‘‘(vii) Qualification as a self-insurer. 

13 ‘‘(viii) Any other method satisfactory 

14 to the Administrator.’’. 

15 SEC. 123. STUDIES AND REPORTS. 

16 (a) STUDY OF LEGAL FRAMEWORK FOR GEOLOGICAL

17 STORAGE SITES.— 

18 (1) ESTABLISHMENT OF TASK FORCE.— 

19 (A) IN GENERAL.—As soon as practicable, 

20 but not later than 180 days after the date of en21 actment of this Act, the Administrator shall es22 tablish a task force, to be composed of an equal 

23 number of— 

24 (i) subject matter experts; 


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1 (ii) nongovernmental organizations 

2 with expertise regarding environmental pol3 icy; 

4 (iii) academic experts with expertise in 

5 environmental law; 

6 (iv) State and tribal officials with en7 vironmental expertise; 

8 (v) representatives of State and tribal 

9 attorneys general; 

10 (vi) representatives of the Environ11 mental Protection Agency, the Department 

12 of the Interior, the Department of Energy, 

13 the Department of Transportation, and 

14 other relevant Federal agencies; and 

15 (vii) members of the private sector. 

16 (B) STUDY.—The task force established 

17 under subparagraph (A) shall conduct a study 

18 of— 

19 (i) existing Federal environmental 

20 statutes, State environmental statutes, and 

21 State common law that apply to geological 

22 storage sites for carbon dioxide, including 

23 the ability of those laws to serve as risk 

24 management tools; 


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1 (ii) the existing statutory framework, 

2 including Federal and State laws, that 

3 apply to harm and damage to the environ4 ment or public health at closed sites at 

5 which carbon dioxide injection has been 

6 used for enhanced hydrocarbon recovery; 

7 (iii) the statutory framework, environ8 mental health and safety considerations, 

9 implementation issues, and financial impli10 cations of potential models for Federal, 

11 State, or private sector assumption of liabil12 ities and financial responsibilities with re13 spect to closed geological storage sites; 

14 (iv) private sector mechanisms, includ15 ing insurance and bonding, that may be 

16 available to manage environmental, health, 

17 and safety risks from closed geological stor18 age sites; and 

19 (v) the subsurface mineral rights, 

20 water rights, and property rights issues as21 sociated with geological storage of carbon 

22 dioxide, including issues specific to Federal 

23 land. 

24 (2) REPORT.—Not later than 18 months after the 

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1 lished under paragraph (1)(A) shall submit to Con2 gress a report describing the results of the study con3 ducted under that paragraph, including any con4 sensus recommendations of the task force. 

5 (b) ENVIRONMENTAL STATUTES.— 

6 (1) STUDY.—The Administrator shall conduct a 

7 study of the means by which, and under what cir8 cumstances, the environmental statutes for which the 

9 Environmental Protection Agency has responsibility 

10 would apply to carbon dioxide injection and geologi11 cal storage activities. 

12 (2) REPORT.—Not later than 1 year after the 

13 date of enactment of this Act, the Administrator shall 

14 submit to Congress a report describing the results of 

15 the study conducted under paragraph (1). 

16 SEC. 124. PERFORMANCE STANDARDS FOR NEW COAL17 FUELED POWER PLANTS. 

18 (a) IN GENERAL.—Part A of title VIII of the Clean 

19 Air Act (as added by section 121 of division B) is amended 

20 by adding at the end the following: 

21 ‘‘SEC. 812. PERFORMANCE STANDARDS FOR NEW COAL22 FIRED POWER PLANTS. 

23 ‘‘(a) DEFINITIONS.—In this section: 

24 ‘‘(1) COVERED EGU.—The term ‘covered EGU’ 

25 means a utility unit that is— 


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1 ‘‘(A) required to have a permit under sec2 tion 503(a); and 

3 ‘‘(B) authorized under State or Federal law 

4 to derive at least 30 percent of the annual heat 

5 input of the unit from— 

6 ‘‘(i) coal; 

7 ‘‘(ii) petroleum coke; or 

8 ‘‘(iii) any combination of those fuels. 

9 ‘‘(2) INITIALLY PERMITTED.— 

10 ‘‘(A) IN GENERAL.—The term ‘initially per11 mitted’, with respect to a covered EGU, means 

12 that— 

13 ‘‘(i) the owner or operator of the cov14 ered EGU has received a preconstruction 

15 approval or permit under this Act as a new 

16 (not modified) source; but 

17 ‘‘(ii) administrative review or appeal 

18 of the approval or permit has not been ex19 hausted. 

20 ‘‘(B) CALCULATION.—A subsequent modi21 fication of any approval or permit described in 

22 subparagraph (A), ongoing administrative or 

23 court review, appeals, challenges, or the existence 

24 or tolling of any time to pursue additional re25 view, appeals, or challenges shall not affect the 


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1 date on which a covered EGU is considered to be 

2 initially permitted for purposes of this para3 graph. 

4 ‘‘(b) STANDARDS.— 

5 ‘‘(1) IN GENERAL.—A covered EGU that is ini6 tially permitted on or after January 1, 2020, shall— 

7 ‘‘(A) achieve an emission limitation that 

8 represents a 65-percent reduction in emissions of 

9 the carbon dioxide produced by the covered EGU, 

10 as measured on an annual basis; or 

11 ‘‘(B) meet such more-stringent standard as 

12 the Administrator may establish pursuant to 

13 subsection (c). 

14 ‘‘(2) CERTAIN COVERED EGUS.— 

15 ‘‘(A) IN GENERAL.—A covered EGU that is 

16 initially permitted during the period beginning 

17 on January 1, 2009, and ending on December 

18 31, 2019, shall achieve, by the applicable compli19 ance date established under this paragraph, an 

20 emission limitation that represents a 50-percent 

21 reduction in emissions of the carbon dioxide pro22 duced by the covered EGU, as measured on an 

23 annual basis. 


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1 ‘‘(B) DATE OF REQUIREMENT.—Compliance 

2 with the requirement described in subparagraph 

3 (A) shall be required by the earlier of— 

4 ‘‘(i) the date that is 4 years after the 

5 date on which the Administrator has pub6 lished pursuant to subsection (d) a report 

7 that there are in commercial operation in 

8 the United States electric generating units 

9 or other stationary sources equipped with 

10 carbon capture and permanent sequestra11 tion technology that, in the aggregate— 

12 ‘‘(I) have a total of at least 10 

13 gigawatts of capacity (including at 

14 least 3 gigawatts which shall be 

15 through electric generating units, and 

16 up to 1 gigawatt which may be 

17 through industrial applications (for 

18 which capture and permanent seques19 tration of 3,000,000 tons of carbon di20 oxide per year on an aggregate 

21 annualized basis shall be considered 

22 equivalent to 1 gigawatt)), measured 

23 as the sum of— 

24 ‘‘(aa) the treated generating 

25 capacity (as defined in section 


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1 780(a)) for electric generating 

2 unit retrofits and industrial 

3 sources; and 

4 ‘‘(bb) the nameplate capacity 

5 for new electric generating units; 

6 ‘‘(II) include at least 3 electric 

7 generating units, each with a name8 plate generating capacity of 250 

9 megawatts or greater, that capture, in10 ject, and sequester carbon dioxide into 

11 geological formations other than oil 

12 and gas fields; and 

13 ‘‘(III) are capturing and seques14 tering at least 12,000,000 tons of car15 bon dioxide per year, calculated on an 

16 aggregate annualized basis; or 

17 ‘‘(ii) January 1, 2020. 

18 ‘‘(3) PROGRESS REVIEW.— 

19 ‘‘(A) IN GENERAL.—Not later than June 30, 

20 2017, the Administrator and the Secretary of 

21 Energy shall jointly prepare and submit to Con22 gress a review of the status of commercial de23 ployment of carbon capture and permanent se24 questration technology that specifies— 


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1 ‘‘(i) the number of and size of units in 

2 the United States that are capturing and 

3 permanently sequestering carbon dioxide; 

4 ‘‘(ii) the tons of carbon dioxide being 

5 captured and permanently sequestered by 

6 those units; and 

7 ‘‘(iii) the geographical and techno8 logical diversity represented by those units 

9 and that technology. 

10 ‘‘(B) FINDING.—To accompany the report 

11 under subparagraph (A), the Administrator and 

12 the Secretary of Energy shall make a finding 

13 that, in light of the status of commercial deploy14 ment of carbon capture and permanent seques15 tration technology, the date set forth in para16 graph (2)(B)(ii) should— 

17 ‘‘(i) remain in effect; or 

18 ‘‘(ii) in accordance with subparagraph 

19 (C), be extended to January 1, 2022. 

20 ‘‘(C) CONDITIONS FOR EXTENSION.—The 

21 date set forth in paragraph (2)(B)(ii) shall be 

22 extended to January 1, 2022, only if— 

23 ‘‘(i) the Administrator and the Sec24 retary jointly find, pursuant to subparaVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00918 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 graph (B), that the extension should occur; 

2 and 

3 ‘‘(ii) Congress acts to approve the find4 ing by not later than January 1, 2018. 

5 ‘‘(4) UNIT-SPECIFIC EXTENSION.— 

6 ‘‘(A) IN GENERAL.—If the deadline for com7 pliance with paragraph (2) is the date specified 

8 in paragraph (2)(B), the Administrator may ex9 tend the deadline for compliance by a covered 

10 EGU by not more than 18 months if the Admin11 istrator makes a determination, based on a 

12 showing by the owner or operator of the covered 

13 EGU, that it will be technically infeasible for the 

14 covered EGU to meet the standard by that date. 

15 ‘‘(B) REQUEST.—An owner or operator of a 

16 covered EGU shall submit to the Administrator 

17 a request for an extension under subparagraph 

18 (A) by not later than June 1, 2018. 

19 ‘‘(C) PUBLIC COMMENT.—The Adminis20 trator shall provide for public notice and com21 ment on each extension request submitted under 

22 subparagraph (B). 

23 ‘‘(c) REVIEW AND REVISION OF STANDARDS.—Not 

24 later than the date specified in subsection (b)(2)(B), and 


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1 not less frequently than once every 5 years thereafter, the 

2 Administrator shall— 

3 ‘‘(1) review the standards for new covered EGUs 

4 under this section; and 

5 ‘‘(2) by rule, reduce the maximum carbon diox6 ide emission rate for new covered EGUs to a rate that 

7 reflects the degree of emission limitation achievable 

8 through the application of the best system of emission 

9 reduction that (taking into account the cost of achiev10 ing the reduction and any nonair quality health and 

11 environmental impact and energy requirements) the 

12 Administrator determines has been adequately dem13 onstrated. 

14 ‘‘(d) REPORTS.—Not later than the date that is 18 

15 months after the date of enactment of this title, and semi16 annually thereafter, the Administrator shall publish a re17 port on the nameplate capacity of units (determined pursu18 ant to subsection (b)(2)(A)) in commercial operation in the 

19 United States equipped with carbon capture and storage 

20 technology, including the information described in sub21 section (b)(2)(A) (including the cumulative generating ca22 pacity to which carbon capture and storage retrofit projects 

23 meeting the criteria described in section 780(c)(1)(A) has 

24 been applied and the quantities of carbon dioxide captured 

25 and sequestered by those projects). 


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1 ‘‘(e) REGULATIONS.—Not later than 2 years after the 

2 date of enactment of this title, the Administrator shall pro3 mulgate regulations to carry out the requirements of this 

4 section.’’. 

5 SEC. 125. CARBON CAPTURE AND SEQUESTRATION DEM6 ONSTRATION AND EARLY DEPLOYMENT PRO7 GRAM. 

8 (a) DEFINITIONS.—For purposes of this section: 

9 (1) SECRETARY.—The term ‘‘Secretary’’ means 

10 the Secretary of Energy. 

11 (2) DISTRIBUTION UTILITY.—The term ‘‘dis12 tribution utility’’ means an entity that distributes 

13 electricity directly to retail consumers under a legal, 

14 regulatory, or contractual obligation to do so. 

15 (3) ELECTRIC UTILITY.—The term ‘‘electric util16 ity’’ has the meaning provided by section 3 of the 

17 Federal Power Act (16 U.S.C. 796). 

18 (4) FOSSIL FUEL-BASED ELECTRICITY.—The 

19 term ‘‘fossil fuel-based electricity’’ means electricity 

20 that is produced from the combustion of fossil fuels. 

21 (5) FOSSIL FUEL.—The term ‘‘fossil fuel’’ means 

22 coal, petroleum, natural gas or any derivative of coal, 

23 petroleum, or natural gas. 


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1 (6) CORPORATION.—The term ‘‘Corporation’’ 

2 means the Carbon Storage Research Corporation es3 tablished in accordance with this section. 

4 (7) QUALIFIED INDUSTRY ORGANIZATION.—The 

5 term ‘‘qualified industry organization’’ means the 

6 Edison Electric Institute, the American Public Power 

7 Association, the National Rural Electric Cooperative 

8 Association, a successor organization of such organi9 zations, or a group of owners or operators of distribu10 tion utilities delivering fossil fuel-based electricity 

11 who collectively represent at least 20 percent of the 

12 volume of fossil fuel-based electricity delivered by dis13 tribution utilities to consumers in the United States. 

14 (8) RETAIL CONSUMER.—The term ‘‘retail con15 sumer’’ means an end-user of electricity. 

16 (b) CARBON STORAGE RESEARCH CORPORATION.— 

17 (1) ESTABLISHMENT.— 

18 (A) REFERENDUM.—Qualified industry or19 ganizations may conduct, at their own expense, 

20 a referendum among the owners or operators of 

21 distribution utilities delivering fossil fuel-based 

22 electricity for the creation of a Carbon Storage 

23 Research Corporation. Such referendum shall be 

24 conducted by an independent auditing firm 

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1 tions. Voting rights in such referendum shall be 

2 based on the quantity of fossil fuel-based elec3 tricity delivered to consumers in the previous 

4 calendar year or other representative period as 

5 determined by the Secretary pursuant to sub6 section (f). Upon approval of those persons rep7 resenting two-thirds of the total quantity of fossil 

8 fuel-based electricity delivered to retail con9 sumers, the Corporation shall be established un10 less opposed by the State regulatory authorities 

11 pursuant to subparagraph (B). All distribution 

12 utilities voting in the referendum shall certify to 

13 the independent auditing firm the quantity of 

14 fossil fuel-based electricity represented by their 

15 vote. 

16 (B) STATE REGULATORY AUTHORITIES.— 

17 Upon its own motion or the petition of a quali18 fied industry organization, each State regulatory 

19 authority shall consider its support or opposition 

20 to the creation of the Corporation under sub21 paragraph (A). State regulatory authorities may 

22 notify the independent auditing firm referred to 

23 in subparagraph (A) of their views on the cre24 ation of the Corporation within 180 days after 

25 the date of enactment of this Act. If 40 percent 


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1 or more of the State regulatory authorities sub2 mit to the independent auditing firm written no3 tices of opposition, the Corporation shall not be 

4 established notwithstanding the approval of the 

5 qualified industry organizations as provided in 

6 subparagraph (A). 

7 (2) TERMINATION.—The Corporation shall be au8 thorized to collect assessments and conduct operations 

9 pursuant to this section for a 10-year period from the 

10 date 6 months after the date of enactment of this Act. 

11 After such 10-year period, the Corporation is no 

12 longer authorized to collect assessments and shall be 

13 dissolved on the date 15 years after such date of en14 actment, unless the period is extended by an Act of 

15 Congress. 

16 (3) GOVERNANCE.—The Corporation shall oper17 ate as a division or affiliate of the Electric Power Re18 search Institute (referred to in this section as 

19 ‘‘EPRI’’) and be managed by a Board of not more 

20 than 15 voting members responsible for its operations, 

21 including compliance with this section. EPRI, in con22 sultation with the Edison Electric Institute, the 

23 American Public Power Association and the National 

24 Rural Electric Cooperative Association shall appoint 

25 the Board members under clauses (i), (ii), and (iii) 


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1 of subparagraph (A) from among candidates rec2 ommended by those organizations. At least a majority 

3 of the Board members appointed by EPRI shall be 

4 representatives of distribution utilities subject to as5 sessments under subsection (d). 

6 (A) MEMBERS.—The Board shall include at 

7 least 1 representative of each of the following: 

8 (i) Investor-owned utilities. 

9 (ii) Utilities owned by a State agency, 

10 a municipality, and an Indian tribe. 

11 (iii) Rural electric cooperatives. 

12 (iv) Fossil fuel producers. 

13 (v) Nonprofit environmental organiza14 tions. 

15 (vi) Independent generators or whole16 sale power providers. 

17 (vii) Consumer groups. 

18 (viii) The National Energy Technology 

19 laboratory of the Department of Energy. 

20 (ix) The Environmental Protection 

21 Agency. 

22 (B) NONVOTING MEMBERS.—The Board 

23 shall also include as additional nonvoting Mem24 bers the Secretary of Energy or his designee and 

25 2 representatives of State regulatory authorities 


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1 as defined in section 3 of the Public Utility Reg2 ulatory Policies Act of 1978 (16 U.S.C. 2602), 

3 each designated by the National Association of 

4 State Regulatory Utility Commissioners from 

5 States that are not within the same transmission 

6 interconnection. 

7 (4) COMPENSATION.—Corporation Board mem8 bers shall receive no compensation for their services, 

9 nor shall Corporation Board members be reimbursed 

10 for expenses relating to their service. 

11 (5) TERMS.—Corporation Board members shall 

12 serve terms of 4 years and may serve not more than 

13 2 full consecutive terms. Members filling unexpired 

14 terms may serve not more than a total of 8 consecu15 tive years. Former members of the Corporation Board 

16 may be reappointed to the Corporation Board if they 

17 have not been members for a period of 2 years. Initial 

18 appointments to the Corporation Board shall be for 

19 terms of 1, 2, 3, and 4 years, staggered to provide for 

20 the selection of 3 members each year. 

21 (6) STATUS OF CORPORATION.—The Corporation 

22 shall not be considered to be an agency, department, 

23 or instrumentality of the United States, and no offi24 cer or director or employee of the Corporation shall 

25 be considered to be an officer or employee of the 


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1 United States Government, for purposes of title 5 or 

2 title 31 of the United States Code, or for any other 

3 purpose, and no funds of the Corporation shall be 

4 treated as public money for purposes of chapter 33 of 

5 title 31, United States Code, or for any other purpose. 

6 (c) FUNCTIONS AND ADMINISTRATION OF THE COR7 PORATION.— 

8 (1) IN GENERAL.—The Corporation shall estab9 lish and administer a program to accelerate the com10 mercial availability of carbon dioxide capture and 

11 storage technologies and methods, including tech12 nologies which capture and store, or capture and con13 vert, carbon dioxide. Under such program competi14 tively awarded grants, contracts, and financial assist15 ance shall be provided and entered into with eligible 

16 entities. Except as provided in paragraph (8), the 

17 Corporation shall use all funds derived from assess18 ments under subsection (d) to issue grants and con19 tracts to eligible entities. 

20 (2) PURPOSE.—The purposes of the grants, con21 tracts, and assistance under this subsection shall be to 

22 support commercial-scale demonstrations of carbon 

23 capture or storage technology projects capable of ad24 vancing the technologies to commercial readiness. 

25 Such projects should encompass a range of different 


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1 coal and other fossil fuel varieties, be geographically 

2 diverse, involve diverse storage media, and employ 

3 capture or storage, or capture and conversion, tech4 nologies potentially suitable either for new or for ret5 rofit applications. The Corporation shall seek, to the 

6 extent feasible, to support at least 5 commercial-scale 

7 demonstration projects integrating carbon capture 

8 and sequestration or conversion technologies. 

9 (3) ELIGIBLE ENTITIES.—Entities eligible for 

10 grants, contracts or assistance under this subsection 

11 may include distribution utilities, electric utilities 

12 and other private entities, academic institutions, na13 tional laboratories, Federal research agencies, State 

14 and tribal research agencies, nonprofit organizations, 

15 or consortiums of 2 or more entities. Pilot-scale and 

16 similar small-scale projects are not eligible for sup17 port by the Corporation. Owners or developers of 

18 projects supported by the Corporation shall, where ap19 propriate, share in the costs of such projects. Projects 

20 supported by the Corporation shall meet the eligibility 

21 criteria of section 780(b) of the Clean Air Act. 

22 (4) GRANTS FOR EARLY MOVERS.—Fifty percent 

23 of the funds raised under this section shall be pro24 vided in the form of grants to electric utilities that 

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1 tion, committed resources to deploy a large scale elec2 tricity generation unit with integrated carbon capture 

3 and sequestration or conversion applied to a substan4 tial portion of the unit’s carbon dioxide emissions.

5 Grant funds shall be provided to defray costs incurred 

6 by such electricity utilities for at least 5 such elec7 tricity generation units. 

8 (5) ADMINISTRATION.—The members of the 

9 Board of Directors of the Corporation shall elect a 

10 Chairman and other officers as necessary, may estab11 lish committees and subcommittees of the Corpora12 tion, and shall adopt rules and bylaws for the conduct 

13 of business and the implementation of this section. 

14 The Board shall appoint an Executive Director and 

15 professional support staff who may be employees of 

16 the Electric Power Research Institute (EPRI). After 

17 consultation with the Technical Advisory Committee 

18 established under subsection (j), the Secretary, and 

19 the Director of the National Energy Technology Lab20 oratory to obtain advice and recommendations on 

21 plans, programs, and project selection criteria, the 

22 Board shall establish priorities for grants, contracts, 

23 and assistance; publish requests for proposals for 

24 grants, contracts, and assistance; and award grants, 

25 contracts, and assistance competitively, on the basis 


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1 of merit, after the establishment of procedures that 

2 provide for scientific peer review by the Technical Ad3 visory Committee. The Board shall give preference to 

4 applications that reflect the best overall value and 

5 prospect for achieving the purposes of the section, such 

6 as those which demonstrate an integrated approach 

7 for capture and storage or capture and conversion 

8 technologies. The Board members shall not participate 

9 in making grants or awards to entities with whom 

10 they are affiliated. 

11 (6) USES OF GRANTS, CONTRACTS, AND ASSIST12 ANCE.—A grant, contract, or other assistance pro13 vided under this subsection may be used to purchase 

14 carbon dioxide when needed to conduct tests of carbon 

15 dioxide storage sites, in the case of established projects 

16 that are storing carbon dioxide emissions, or for other 

17 purposes consistent with the purposes of this section. 

18 The Corporation shall make publicly available at no 

19 cost information learned as a result of projects which 

20 it supports financially. 

21 (7) ADMINISTRATIVE EXPENSES.—Up to 5 per22 cent of the funds collected in any fiscal year under 

23 subsection (d) may be used for the administrative ex24 penses of operating the Corporation (not including 


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1 costs incurred in the determination and collection of 

2 the assessments pursuant to subsection (d)). 

3 (8) PROGRAMS AND BUDGET.—Before August 1 

4 each year, the Corporation, after consulting with the 

5 Technical Advisory Committee and the Secretary and 

6 the Director of the Department’s National Energy 

7 Technology Laboratory and other interested parties to 

8 obtain advice and recommendations, shall publish for 

9 public review and comment its proposed plans, pro10 grams, project selection criteria, and projects to be 

11 funded by the Corporation for the next calendar year. 

12 The Corporation shall also publish for public review 

13 and comment a budget plan for the next calendar 

14 year, including the probable costs of all programs, 

15 projects, and contracts and a recommended rate of as16 sessment sufficient to cover such costs. The Secretary 

17 may recommend programs and activities the Sec18 retary considers appropriate. The Corporation shall 

19 include in the first publication it issues under this 

20 paragraph a strategic plan or roadmap for the 

21 achievement of the purposes of the Corporation, as set 

22 forth in paragraph (2). 

23 (9) RECORDS; AUDITS.—The Corporation shall 

24 keep minutes, books, and records that clearly reflect 

25 all of the acts and transactions of the Corporation 


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1 and make public such information. The books of the 

2 Corporation shall be audited by a certified public ac3 countant at least once each fiscal year and at such 

4 other times as the Corporation may designate. Copies 

5 of each audit shall be provided to the Congress, all 

6 Corporation board members, all qualified industry or7 ganizations, each State regulatory authority and, 

8 upon request, to other members of the industry. If the 

9 audit determines that the Corporation’s practices fail 

10 to meet generally accepted accounting principles the 

11 assessment collection authority of the Corporation 

12 under subsection (d) shall be suspended until a cer13 tified public accountant renders a subsequent opinion 

14 that the failure has been corrected. The Corporation 

15 shall make its books and records available for review 

16 by the Secretary or the Comptroller General of the 

17 United States. 

18 (10) PUBLIC ACCESS.—The Corporation Board’s 

19 meetings shall be open to the public and shall occur 

20 after at least 30 days advance public notice. Meetings 

21 of the Board of Directors may be closed to the public 

22 where the agenda of such meetings includes only con23 fidential matters pertaining to project selection, the 

24 award of grants or contracts, personnel matters, or 

25 the receipt of legal advice. The minutes of all meetings 


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1 of the Corporation shall be made available to and 

2 readily accessible by the public. 

3 (11) ANNUAL REPORT.—Each year the Corpora4 tion shall prepare and make publicly available a re5 port which includes an identification and description 

6 of all programs and projects undertaken by the Cor7 poration during the previous year. The report shall 

8 also detail the allocation or planned allocation of Cor9 poration resources for each such program and project. 

10 The Corporation shall provide its annual report to 

11 the Congress, the Secretary, each State regulatory au12 thority, and upon request to the public. The Secretary 

13 shall, not less than 60 days after receiving such re14 port, provide to the President and Congress a report 

15 assessing the progress of the Corporation in meeting 

16 the objectives of this section. 

17 (d) ASSESSMENTS.— 

18 (1) AMOUNT.—(A) In all calendar years fol19 lowing its establishment, the Corporation shall collect 

20 an assessment on distribution utilities for all fossil 

21 fuel-based electricity delivered directly to retail con22 sumers (as determined under subsection (f)). The as23 sessments shall reflect the relative carbon dioxide 

24 emission rates of different fossil fuel-based electricity, 


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1 and initially shall be not less than the following 

2 amounts for coal, natural gas, and oil: 

Fuel type Rate of assessment 

per kilowatt hour 

Coal ........................................................................ $0.00043 

Natural Gas .......................................................... $0.00022 

Oil .......................................................................... $0.00032. 

3 (B) The Corporation is authorized to adjust the 

4 assessments on fossil fuel-based electricity to reflect 

5 changes in the expected quantities of such electricity 

6 from different fuel types, such that the assessments 

7 generate not less than $1.0 billion and not more than 

8 $1.1 billion annually. The Corporation is authorized 

9 to supplement assessments through additional finan10 cial commitments. 

11 (2) INVESTMENT OF FUNDS.—Pending disburse12 ment pursuant to a program, plan, or project, the 

13 Corporation may invest funds collected through as14 sessments under this subsection, and any other funds 

15 received by the Corporation, only in obligations of the 

16 United States or any agency thereof, in general obli17 gations of any State or any political subdivision 

18 thereof, in any interest-bearing account or certificate 

19 of deposit of a bank that is a member of the Federal 

20 Reserve System, or in obligations fully guaranteed as 

21 to principal and interest by the United States. 


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1 (3) REVERSION OF UNUSED FUNDS.—If the Cor2 poration does not disburse, dedicate or assign 75 per3 cent or more of the available proceeds of the assessed 

4 fees in any calendar year 7 or more years following 

5 its establishment, due to an absence of qualified 

6 projects or similar circumstances, it shall reimburse 

7 the remaining undedicated or unassigned balance of 

8 such fees, less administrative and other expenses au9 thorized by this section, to the distribution utilities 

10 upon which such fees were assessed, in proportion to 

11 their collected assessments. 

12 (e) ERCOT.— 

13 (1) ASSESSMENT, COLLECTION, AND REMIT14 TANCE.—(A) Notwithstanding any other provision of 

15 this section, within ERCOT, the assessment provided 

16 for in subsection (d) shall be— 

17 (i) levied directly on qualified scheduling 

18 entities, or their successor entities; 

19 (ii) charged consistent with other charges 

20 imposed on qualified scheduling entities as a fee 

21 on energy used by the load-serving entities; and 

22 (iii) collected and remitted by ERCOT to 

23 the Corporation in the amounts and in the same 

24 manner as set forth in subsection (d). 


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1 (B) The assessment amounts referred to in sub2 paragraph (A) shall be— 

3 (i) determined by the amount and types of 

4 fossil fuel-based electricity delivered directly to 

5 all retail customers in the prior calendar year 

6 beginning with the year ending immediately 

7 prior to the period described in subsection (b)(2); 

8 and 

9 (ii) take into account the number of renew10 able energy credits retired by the load-serving en11 tities represented by a qualified scheduling entity 

12 within the prior calendar year. 

13 (2) ADMINISTRATION EXPENSES.—Up to 1 per14 cent of the funds collected in any fiscal year by 

15 ERCOT under the provisions of this subsection may 

16 be used for the administrative expenses incurred in 

17 the determination, collection and remittance of the as18 sessments to the Corporation. 

19 (3) AUDIT.—ERCOT shall provide a copy of its 

20 annual audit pertaining to the administration of the 

21 provisions of this subsection to the Corporation. 

22 (4) DEFINITIONS.—For the purposes of this sub23 section: 

24 (A) The term ‘‘ERCOT’’ means the Electric 

25 Reliability Council of Texas. 


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1 (B) The term ‘‘load-serving entities’’ has the 

2 meaning adopted by ERCOT Protocols and in 

3 effect on the date of enactment of this Act. 

4 (C) The term ‘‘qualified scheduling entities’’ 

5 has the meaning adopted by ERCOT Protocols 

6 and in effect on the date of enactment of this 

7 Act. 

8 (D) The term ‘‘renewable energy credit’’ has 

9 the meaning as promulgated and adopted by the 

10 Public Utility Commission of Texas pursuant to 

11 section 39.904(b) of the Public Utility Regu12 latory Act of 1999, and in effect on the date of 

13 enactment of this Act. 

14 (f) DETERMINATION OF FOSSIL FUEL-BASED ELEC15 TRICITY DELIVERIES.— 

16 (1) FINDINGS.—The Congress finds that: 

17 (A) The assessments under subsection (d) 

18 are to be collected based on the amount of fossil 

19 fuel-based electricity delivered by each distribu20 tion utility. 

21 (B) Since many distribution utilities pur22 chase all or part of their retail consumer’s elec23 tricity needs from other entities, it may not be 

24 practical to determine the precise fuel mix for 


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1 the power sold by each individual distribution 

2 utility. 

3 (C) It may be necessary to use average 

4 data, often on a regional basis with reference to 

5 Regional Transmission Organization (‘‘RTO’’) 

6 or NERC regions, to make the determinations 

7 necessary for making assessments. 

8 (2) DOE PROPOSED RULE.—The Secretary, act9 ing in close consultation with the Energy Information 

10 Administration, shall issue for notice and comment a 

11 proposed rule to determine the level of fossil fuel elec12 tricity delivered to retail customers by each distribu13 tion utility in the United States during the most re14 cent calendar year or other period determined to be 

15 most appropriate. Such proposed rule shall balance 

16 the need to be efficient, reasonably precise, and time17 ly, taking into account the nature and cost of data 

18 currently available and the nature of markets and 

19 regulation in effect in various regions of the country. 

20 Different methodologies may be applied in different 

21 regions if appropriate to obtain the best balance of 

22 such factors. 

23 (3) FINAL RULE.—Within 6 months after the 

24 date of enactment of this Act, and after opportunity 

25 for comment, the Secretary shall issue a final rule 


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1 under this subsection for determining the level and 

2 type of fossil fuel-based electricity delivered to retail 

3 customers by each distribution utility in the United 

4 States during the appropriate period. In issuing such 

5 rule, the Secretary may consider opportunities and 

6 costs to develop new data sources in the future and 

7 issue recommendations for the Energy Information 

8 Administration or other entities to collect such data. 

9 After notice and opportunity for comment the Sec10 retary may, by rule, subsequently update and modify 

11 the methodology for making such determinations. 

12 (4) ANNUAL DETERMINATIONS.—Pursuant to the 

13 final rule issued under paragraph (3), the Secretary 

14 shall make annual determinations of the amounts and 

15 types for each such utility and publish such deter16 minations in the Federal Register. Such determina17 tions shall be used to conduct the referendum under 

18 subsection (b) and by the Corporation in applying 

19 any assessment under this subsection. 

20 (5) REHEARING AND JUDICIAL REVIEW.—The 

21 owner or operator of any distribution utility that be22 lieves that the Secretary has misapplied the method23 ology in the final rule in determining the amount 

24 and types of fossil fuel electricity delivered by such 

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1 mination within 30 days of publication of the deter2 mination in the Federal Register. The Secretary shall 

3 decide such rehearing petitions within 30 days. The 

4 Secretary’s determinations following rehearing shall 

5 be final and subject to judicial review in the United 

6 States Court of Appeals for the District of Columbia. 

7 (g) COMPLIANCE WITH CORPORATION ASSESS8 MENTS.—The Corporation may bring an action in the ap9 propriate court of the United States to compel compliance 

10 with an assessment levied by the Corporation under this 

11 section. A successful action for compliance under this sub12 section may also require payment by the defendant of the 

13 costs incurred by the Corporation in bringing such action. 

14 (h) MIDCOURSE REVIEW.—Not later than 5 years fol15 lowing establishment of the Corporation, the Comptroller 

16 General of the United States shall prepare an analysis, and 

17 report to Congress, assessing the Corporation’s activities, 

18 including project selection and methods of disbursement of 

19 assessed fees, impacts on the prospects for commercializa20 tion of carbon capture and storage technologies, adequacy 

21 of funding, and administration of funds. The report shall 

22 also make such recommendations as may be appropriate in 

23 each of these areas. The Corporation shall reimburse the 

24 Government Accountability Office for the costs associated 

25 with performing this midcourse review. 


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1 (i) RECOVERY OF COSTS.— 

2 (1) IN GENERAL.—A distribution utility whose 

3 transmission, delivery, or sales of electric energy are 

4 subject to any form of rate regulation shall not be de5 nied the opportunity to recover the full amount of the 

6 prudently incurred costs associated with complying 

7 with this section, consistent with applicable State or 

8 Federal law. 

9 (2) RATEPAYER REBATES.—Regulatory authori10 ties that approve cost recovery pursuant to paragraph 

11 (1) may order rebates to ratepayers to the extent that 

12 distribution utilities are reimbursed undedicated or 

13 unassigned balances pursuant to subsection (d)(3). 

14 (j) TECHNICAL ADVISORY COMMITTEE.— 

15 (1) ESTABLISHMENT.—There is established an 

16 advisory committee, to be known as the ‘‘Technical 

17 Advisory Committee’’. 

18 (2) MEMBERSHIP.—The Technical Advisory 

19 Committee shall be comprised of not less than 7 mem20 bers appointed by the Board from among academic 

21 institutions, national laboratories, independent re22 search institutions, and other qualified institutions. 

23 No member of the Committee shall be affiliated with 

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1 mittee shall be appointed from among officers or em2 ployees of the Department of Energy recommended to 

3 the Board by the Secretary of Energy. 

4 (3) CHAIRPERSON AND VICE CHAIRPERSON.—The 

5 Board shall designate one member of the Technical 

6 Advisory Committee to serve as Chairperson of the 

7 Committee and one to serve as Vice Chairperson of 

8 the Committee. 

9 (4) COMPENSATION.—The Board shall provide 

10 compensation to members of the Technical Advisory 

11 Committee for travel and other incidental expenses 

12 and such other compensation as the Board determines 

13 to be necessary. 

14 (5) PURPOSE.—The Technical Advisory Com15 mittee shall provide independent assessments and 

16 technical evaluations, as well as make non-binding 

17 recommendations to the Board, concerning Corpora18 tion activities, including but not limited to the fol19 lowing: 

20 (A) Reviewing and evaluating the Corpora21 tion’s plans and budgets described in subsection 

22 (c)(9), as well as any other appropriate areas, 

23 which could include approaches to prioritizing 

24 technologies, appropriateness of engineering tech25 niques, monitoring and verification technologies 


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1 for storage, geological site selection, and cost con2 trol measures. 

3 (B) Making annual non-binding rec4 ommendations to the Board concerning any of 

5 the matters referred to in subparagraph (A), as 

6 well as what types of investments, scientific re7 search, or engineering practices would best fur8 ther the goals of the Corporation. 

9 (6) PUBLIC AVAILABILITY.—All reports, evalua10 tions, and other materials of the Technical Advisory 

11 Committee shall be made available to the public by 

12 the Board, without charge, at time of receipt by the 

13 Board. 

14 (k) LOBBYING RESTRICTIONS.—No funds collected by 

15 the Corporation shall be used in any manner for influ16 encing legislation or elections, except that the Corporation 

17 may recommend to the Secretary and the Congress changes 

18 in this section or other statutes that would further the pur19 poses of this section. 

20 (l) DAVIS-BACON COMPLIANCE.—The Corporation 

21 shall ensure that entities receiving grants, contracts, or 

22 other financial support from the Corporation for the project 

23 activities authorized by this section are in compliance with 

24 subchapter IV of chapter 31 of title 40, United States Code 

25 (commonly known as the ‘‘Davis-Bacon Act’’). 


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1 Subtitle C—Nuclear and Advanced 

2 Technologies 

3 SEC. 131. FINDINGS AND POLICY. 

4 (a) FINDINGS.—Congress finds that— 

5 (1) in 2008, 104 nuclear power plants produced 

6 19.6 percent of the electricity generated in the United 

7 States, slightly less than the electricity generated by 

8 natural gas; 

9 (2) nuclear energy is the largest provider of 

10 clean, low-carbon, electricity, almost 8 times larger 

11 than all renewable power production combined, ex12 cluding hydroelectric power; 

13 (3) nuclear energy supplies consistent, base-load 

14 electricity, independent of environmental conditions; 

15 (4) by displacing fossil fuels that would other16 wise be used for electricity production, nuclear power 

17 plants virtually eliminate emissions of greenhouse 

18 gases and criteria pollutants associated with acid 

19 rain, smog, or ozone; 

20 (5) nuclear power generation continues to re21 quire robust efforts to address issues of safety, waste, 

22 and proliferation; 

23 (6) even if every nuclear plant is granted a 20- 

24 year extension, all currently operating nuclear plants 

25 will be retired by 2055; 


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1 (7) long lead times for nuclear power plant con2 struction indicate that action to stimulate the nuclear 

3 power industry should not be delayed; 

4 (8) the high upfront capital costs of nuclear 

5 plant construction remain a substantial obstacle, de6 spite theoretical potential for significant cost reduc7 tion; 

8 (9) translating theoretical cost reduction poten9 tial into actual reduced construction costs remains a 

10 significant industry challenge that can be overcome 

11 only through demonstrated performance; 

12 (10) as of January 2009, 17 companies and con13 sortia have submitted applications to the Nuclear 

14 Regulatory Commission for 26 new reactors in the 

15 United States; 

16 (11) those proposed reactors will use the latest in 

17 nuclear technology for efficiency and safety, more ad18 vanced than the technology of the 1960s and 1970s 

19 found in the reactors currently operating in the 

20 United States; 

21 (12) increased resources for the Nuclear Regu22 latory Commission and reform of the licensing process 

23 have improved the safety and timeliness of the regu24 latory environment; 


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1 (13) the United States has not built a new reac2 tor since the 1970s and, as a result, will need to revi3 talize and retool the institutions and infrastructure 

4 necessary to construct, maintain, and support new re5 actors, including improvements in manufacturing of 

6 nuclear components and training for the next genera7 tion nuclear workforce; and 

8 (14) those new reactors will launch a new era for 

9 the nuclear industry, and translate into tens of thou10 sands of jobs 

11 (b) STATEMENT OF POLICY.—It is the policy of the 

12 United States, given the importance of transitioning to a 

13 clean energy, low-carbon economy, to facilitate the contin14 ued development and growth of a safe and clean nuclear 

15 energy industry, through— 

16 (1) reductions in financial and technical bar17 riers to construction and operation; and 

18 (2) incentives for the development of a well19 trained workforce and the growth of safe domestic nu20 clear and nuclear-related industries. 

21 SEC. 132. NUCLEAR WORKER TRAINING. 

22 (a) DEFINITION OF APPLICABLE PERIOD.—In this sec23 tion, the term ‘‘applicable period’’ means— 

24 (1) the 5-year period beginning on January 1, 

25 2012; and 


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1 (2) each 5-year period beginning on each Janu2 ary 1 thereafter. 

3 (b) USE OF FUNDS.—Of amounts made available to 

4 carry out this section for the calendar years in each appli5 cable period— 

6 (1) the Secretary of Energy shall use such 

7 amounts for each applicable period as the Secretary 

8 of Energy determines to be necessary to increase the 

9 number and amounts of nuclear science talent expan10 sion grants and nuclear science competitiveness 

11 grants provided under section 5004 of the America 

12 COMPETES Act (42 U.S.C. 16532); and 

13 (2) the Secretary of Labor, in consultation with 

14 nuclear energy entities and organized labor, shall use 

15 such amounts for each applicable period as the Sec16 retary of Labor determines to be necessary to carry 

17 out programs expanding workforce training to meet 

18 the high demand for workers skilled in nuclear power 

19 plant construction and operation, including programs 

20 for— 

21 (A) electrical craft certification; 

22 (B) preapprenticeship career technical edu23 cation for industrialized skilled crafts that are 

24 useful in the construction of nuclear power 

25 plants; 


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1 (C) community college and skill center 

2 training for nuclear power plant technicians; 

3 (D) training of construction management 

4 personnel for nuclear power plant construction 

5 projects; and 

6 (E) regional grants for integrated nuclear 

7 energy workforce development programs. 

8 SEC. 133. NUCLEAR SAFETY AND WASTE MANAGEMENT PRO9 GRAMS. 

10 (a) NUCLEAR FACILITY LONG-TERM OPERATIONS RE11 SEARCH AND DEVELOPMENT PROGRAM.— 

12 (1) ESTABLISHMENT.—As soon as practicable 

13 after the date of enactment of this Act, the Secretary 

14 of Energy (referred to in this section as the ‘‘Sec15 retary’’) shall establish a research and development 

16 program— 

17 (A) to address the reliability, availability, 

18 productivity, component aging, safety, and secu19 rity of nuclear power plants; 

20 (B) to improve the performance of nuclear 

21 power plants; 

22 (C) to sustain the health and safety of em23 ployees of nuclear power plants; 

24 (D) to assess the feasibility of nuclear power 

25 plants to continue to provide clean and economic 


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1 electricity safely, substantially beyond the first 

2 license extension period of the nuclear power 

3 plants, which will— 

4 (i) significantly contribute to the en5 ergy security of the United States; and 

6 (ii) help protect the environment of the 

7 United States; and 

8 (E) to support significant carbon reduc9 tions, lower overall costs that are required to re10 duce carbon emissions, and increase energy secu11 rity. 

12 (2) CONDUCT OF PROGRAM.— 

13 (A) IN GENERAL.—In carrying out the pro14 gram established under paragraph (1), the Sec15 retary shall— 

16 (i) build a fundamental scientific basis 

17 to understand, predict, and measure 

18 changes in materials, systems, structures, 

19 equipment, and components as the mate20 rials, systems, structures, equipment, and 

21 components age through continued oper22 ations in long-term service environments; 

23 (ii) develop new safety analysis tools 

24 and methods to enhance the performance 

25 and safety of nuclear power plants; 


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1 (iii) develop advanced online moni2 toring, control, and diagnostics technologies 

3 to prevent equipment failures and improve 

4 the safety of nuclear power plants; 

5 (iv) establish a technical basis for ad6 vanced fuel designs (including silicon car7 bide fuel cladding) to increase the safety 

8 margins of nuclear power plants; and 

9 (v) examine issues, including— 

10 (I) issues relating to material deg11 radation, plant aging, and technology 

12 upgrades; and 

13 (II) any other issue that would 

14 impact decisions to extend the lifespan 

15 of nuclear power plants. 

16 (B) TECHNICAL SUPPORT.—In carrying out 

17 the program established under paragraph (1), 

18 the Secretary shall provide to the Chairman of 

19 the Nuclear Regulatory Commission information 

20 collected under the program— 

21 (i) to help ensure informed decisions 

22 regarding the extension of the life of nuclear 

23 power plants beyond a 60-year lifespan; 

24 and 


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1 (ii) for the licensing and long-term 

2 management, and safe and economical oper3 ation, of nuclear power plants. 

4 (b) SPENT NUCLEAR WASTE DISPOSAL RESEARCH

5 AND DEVELOPMENT PROGRAM.— 

6 (1) ESTABLISHMENT.—As soon as practicable 

7 after the date of enactment of this Act, the Secretary 

8 shall establish a research and development program to 

9 improve the understanding of nuclear spent fuel man10 agement and the entire nuclear fuel cycle life. 

11 (2) CONDUCT OF PROGRAM.—In carrying out the 

12 program established under paragraph (1), the Sec13 retary shall carry out science-based research and de14 velopment activities to pursue dramatic improve15 ments in a range of nuclear spent fuel management 

16 options, including short-term and long-term storage 

17 and disposal, and proliferation-resistant nuclear 

18 spent fuel recycling. 

19 (c) AUTHORIZATION OF APPROPRIATIONS.—There are 

20 authorized to be appropriated such sums as are necessary 

21 to carry out this section. 

22 Subtitle D—Water Efficiency 

23 SEC. 141. WATERSENSE. 

24 (a) IN GENERAL.—There is established within the En25 vironmental Protection Agency a WaterSense program to 


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1 identify and promote water-efficient products, buildings, 

2 landscapes, facilities, processes, and services, so as— 

3 (1) to reduce water use; 

4 (2) to reduce the strain on water, wastewater, 

5 and stormwater infrastructure; 

6 (3) to conserve energy used to pump, heat, trans7 port, and treat water; and 

8 (4) to preserve water resources for future genera9 tions, through voluntary labeling of, or other forms of 

10 communications about, products, buildings, land11 scapes, facilities, processes, and services that meet the 

12 highest water efficiency and performance criteria. 

13 (b) DUTIES.—The Administrator shall— 

14 (1) establish— 

15 (A) a WaterSense label to be used for cer16 tain items; and 

17 (B) the procedure by which an item may be 

18 certified to display the WaterSense label; 

19 (2) promote WaterSense-labeled products, build20 ings, landscapes, facilities, processes, and services in 

21 the market place as the preferred technologies and 

22 services for— 

23 (A) reducing water use; and 

24 (B) ensuring product and service perform25 ance; 


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1 (3) work to enhance public awareness of the 

2 WaterSense label through public outreach, education, 

3 and other means; 

4 (4) preserve the integrity of the WaterSense label 

5 by— 

6 (A) establishing and maintaining perform7 ance criteria so that products, buildings, land8 scapes, facilities, processes, and services labeled 

9 with the WaterSense label perform as well or bet10 ter than less water-efficient counterparts; 

11 (B) overseeing WaterSense certifications 

12 made by third parties; 

13 (C) conducting reviews of the use of the 

14 WaterSense label in the marketplace and taking 

15 corrective action in any case in which misuse of 

16 the label is identified; and 

17 (D) carrying out such other measures as the 

18 Administrator determines to be appropriate; 

19 (5) regularly review and, if appropriate, update 

20 WaterSense criteria for categories of products, build21 ings, landscapes, facilities, processes, and services, at 

22 least once every 4 years; 

23 (6) to the maximum extent practicable, regularly 

24 estimate and make available to the public the produc25 tion and relative market shares of, and the savings of 


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1 water, energy, and capital costs of water, wastewater, 

2 and stormwater infrastructure attributable to the use 

3 of WaterSense-labeled products, buildings, landscapes, 

4 facilities, processes, and services, at least annually; 

5 (7) solicit comments from interested parties and 

6 the public prior to establishing or revising a 

7 WaterSense category, specification, installation cri8 terion, or other criterion (or prior to effective dates 

9 for any such category, specification, installation cri10 terion, or other criterion); 

11 (8) provide reasonable notice to interested parties 

12 and the public of any changes (including effective 

13 dates), on the adoption of a new or revised category, 

14 specification, installation criterion, or other criterion, 

15 along with— 

16 (A) an explanation of the changes; and 

17 (B) as appropriate, responses to comments 

18 submitted by interested parties and the public; 

19 (9) provide appropriate lead time (as determined 

20 by the Administrator) prior to the applicable effective 

21 date for a new or significant revision to a category, 

22 specification, installation criterion, or other criterion, 

23 taking into account the timing requirements of the 

24 manufacturing, marketing, training, and distribution 


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1 process for the specific product, building and land2 scape, or service category addressed; 

3 (10) identify and, if appropriate, implement 

4 other voluntary approaches in commercial, institu5 tional, residential, industrial, and municipal sectors 

6 to encourage recycling and reuse technologies to im7 prove water efficiency or lower water use; and 

8 (11) where appropriate, apply the WaterSense 

9 label to water-using products that are labeled by the 

10 Energy Star program implemented by the Adminis11 trator and the Secretary of Energy. 

12 (c) AUTHORIZATION OF APPROPRIATIONS.—There are 

13 authorized to be appropriated to carry out this section— 

14 (1) $7,500,000 for fiscal year 2010; 

15 (2) $10,000,000 for fiscal year 2011; 

16 (3) $20,000,000 for fiscal year 2012; 

17 (4) $50,000,000 for fiscal year 2013; and 

18 (5) for each subsequent fiscal year, the applicable 

19 amount during the preceding fiscal year, as adjusted 

20 to reflect changes for the 12-month period ending the 

21 preceding November 30 in the Consumer Price Index 

22 for All Urban Consumers published by the Bureau of 

23 Labor Statistics of the Department of Labor. 


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1 SEC. 142. FEDERAL PROCUREMENT OF WATER-EFFICIENT 

2 PRODUCTS. 

3 (a) DEFINITIONS.—In this section: 

4 (1) AGENCY.—The term ‘‘Agency’’ has the mean5 ing given the term in section 7902(a) of title 5, 

6 United States Code. 

7 (2) FEMP-DESIGNATED PRODUCT.—The term 

8 ‘‘FEMP-designated product’’ means a product that is 

9 designated under the Federal Energy Management 

10 Program of the Department of Energy as being 

11 among the highest 25 percent of equivalent products 

12 for efficiency. 

13 (3) PRODUCT, BUILDING, LANDSCAPE, FACILITY, 

14 PROCESS, AND SERVICE.—The terms ‘‘product’’, 

15 ‘‘building’’, ‘‘landscape’’, ‘‘facility’’, ‘‘process’’, and 

16 ‘‘service’’ do not include— 

17 (A) any water-using product, building, 

18 landscape, facility, process, or service designed or 

19 procured for combat or combat-related missions; 

20 or 

21 (B) any product, building, landscape, facil22 ity, process, or service already covered by the 

23 Federal procurement regulations established 

24 under section 553 of the National Energy Con25 servation Policy Act (42 U.S.C. 8259b). 


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1 (4) WATERSENSE PRODUCT, BUILDING, LAND2 SCAPE, FACILITY, PROCESS, OR SERVICE.—The term 

3 ‘‘WaterSense product, building, landscape, facility, 

4 process, or service’’ means a product, building, land5 scape, facility, process, or service that is labeled for 

6 water efficiency under the WaterSense program. 

7 (5) WATERSENSE PROGRAM.—The term 

8 ‘‘WaterSense program’’ means the program estab9 lished by section 141. 

10 (b) PROCUREMENT OF WATER EFFICIENT PROD11 UCTS.— 

12 (1) REQUIREMENT.— 

13 (A) IN GENERAL.—To meet the require14 ments of an agency for a water-using product, 

15 building, landscape, facility, process, or service, 

16 the head of an Agency shall, except as provided 

17 in paragraph (2), procure— 

18 (i) a WaterSense product, building, 

19 landscape, facility, process, or service; or 

20 (ii) a FEMP-designated product. 

21 (B) SENSE OF CONGRESS REGARDING IN22 STALLATION PREFERENCES.—It is the sense of 

23 Congress that a WaterSense irrigation system 

24 should, to the maximum extent practicable, be 

25 installed and audited by a WaterSense-certified 


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1 irrigation professional to ensure optimal per2 formance. 

3 (2) EXCEPTIONS.—The head of an Agency shall 

4 not be required to procure a WaterSense product, 

5 building, landscape, facility, process, or service or 

6 FEMP-designated product under paragraph (1) if the 

7 head of the Agency finds in writing that— 

8 (A) a WaterSense product, building, land9 scape, facility, process, or service or FEMP-des10 ignated product is not cost-effective over the life 

11 of the product, building, landscape, facility, 

12 process, or service, taking energy, water, and 

13 wastewater service cost savings into account; or 

14 (B) no WaterSense product, building, land15 scape, facility, process, or service or FEMP-des16 ignated product is reasonably available that 

17 meets the functional requirements of the Agency. 

18 (3) PROCUREMENT PLANNING.— 

19 (A) IN GENERAL.—The head of an Agency 

20 shall incorporate criteria used for evaluating 

21 WaterSense products, buildings, landscapes, fa22 cilities, processes, and services and FEMP-des23 ignated products into— 

24 (i) the specifications for all procure25 ments involving water-using products, 


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1 buildings, landscapes, facilities, processes, 

2 and systems, including guide specifications, 

3 project specifications, and construction, ren4 ovation, and services contracts that include 

5 provision of water-using products, build6 ings, landscapes, facilities, processes, and 

7 systems; and 

8 (ii) the factors for the evaluation of of9 fers received for the procurement. 

10 (B) LISTING OF WATER-EFFICIENT PROD11 UCTS IN FEDERAL CATALOGS.—WaterSense prod12 ucts, buildings, landscapes, facilities, processes, 

13 and systems and FEMP-designated products 

14 shall be clearly identified and prominently dis15 played in any inventory or listing of products by 

16 the General Services Administration or the De17 fense Logistics Agency. 

18 (C) ADDITIONAL MEASURES.—The head of 

19 an Agency shall consider, to the maximum extent 

20 practicable, additional measures for reducing 

21 Agency water use, including water reuse tech22 nologies, leak detection and repair, and use of 

23 waterless products that perform similar func24 tions to existing water-using products. 


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1 (c) RETROFIT PROGRAMS.—The head of each Agency, 

2 working in coordination with the Administrator and the 

3 heads of such other Agencies as the President may designate, 

4 shall develop standards and implementation procedures for 

5 a building water efficiency retrofit program, which shall 

6 include the following elements: 

7 (1) EVALUATION OF PRODUCTS AND SYSTEMS.— 

8 Not later than 270 days after the date of enactment 

9 of this Act, each Agency shall evaluate water-con10 suming products and systems in buildings operated 

11 by such Agency and identify opportunities for retrofit 

12 and replacement of such products and systems with 

13 high-efficiency equipment, such as zero-water-con14 sumption equipment, high-efficiency toilets, high-effi15 ciency shower heads, and high-efficiency faucets, and 

16 other products that are certified as Watersense prod17 ucts or FEMP-designated products. 

18 (2) RETROFIT PLAN.—Not later than 360 days 

19 after the date of enactment of this Act, each Agency 

20 shall, in coordination with other appropriate Agencies 

21 and officials, prepare a water efficiency retrofit plan 

22 that shall, to the maximum extent practicable, maxi23 mize retrofitting of water-consuming products and 

24 systems and replacement with high-efficiency equip25 ment described in paragraph (1). 


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1 (d) GUIDELINES.—Not later than 180 days after the 

2 date of enactment of this Act, the Administrator, working 

3 in coordination with the Secretary of Energy and the heads 

4 of such other Agencies as the President may designate, shall 

5 issue guidelines to carry out this section. 

6 SEC. 143. STATE RESIDENTIAL WATER EFFICIENCY AND 

7 CONSERVATION INCENTIVES PROGRAM. 

8 (a) DEFINITIONS.—In this section: 

9 (1) ELIGIBLE ENTITY.—The term ‘‘eligible enti10 ty’’ means a State government, local or county gov11 ernment, tribal government, wastewater or sewerage 

12 utility, municipal water authority, energy utility, 

13 water utility, or nonprofit organization that meets 

14 the requirements of subsection (b). 

15 (2) INCENTIVE PROGRAM.—The term ‘‘incentive 

16 program’’ means a program for administering finan17 cial incentives for consumer purchase and installation 

18 of water-efficient products, buildings (including New 

19 Water-Efficient Homes), landscapes, processes, or 

20 services described in subsection (b)(1). 

21 (3) RESIDENTIAL WATER-EFFICIENT PRODUCT, 

22 BUILDING, LANDSCAPE, PROCESS, OR SERVICE.— 

23 (A) IN GENERAL.—The term ‘‘residential 

24 water-efficient product, building, landscape, 

25 process, or service’’ means a product, building, 


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1 landscape, process, or service for a residence or 

2 its landscape that is rated for water efficiency 

3 and performance— 

4 (i) by the WaterSense program; or 

5 (ii) if a WaterSense specification does 

6 not exist, by the Energy Star program or 

7 an incentive program approved by the Ad8 ministrator. 

9 (B) INCLUSIONS.—The term ‘‘residential 

10 water-efficient product, building, landscape, 

11 process, or service’’ includes— 

12 (i) faucets; 

13 (ii) irrigation technologies and serv14 ices; 

15 (iii) point-of-use water treatment de16 vices; 

17 (iv) reuse and recycling technologies; 

18 (v) toilets; 

19 (vi) clothes washers; 

20 (vii) dishwashers; 

21 (viii) showerheads; 

22 (ix) xeriscaping and other landscape 

23 conversions that replace irrigated turf; and 

24 (x) New Water Efficient Homes cer25 tified by the WaterSense program. 


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1 (4) WATERSENSE PROGRAM.—The term 

2 ‘‘WaterSense program’’ means the program estab3 lished by section 141. 

4 (b) ELIGIBLE ENTITIES.—An entity shall be eligible 

5 to receive an allocation under subsection (c) if the entity— 

6 (1) establishes (or has established) an incentive 

7 program to provide financial incentives to residential 

8 consumers for the purchase of residential water-effi9 cient products, buildings, landscapes, processes, or 

10 services; 

11 (2) submits an application for the allocation at 

12 such time, in such form, and containing such infor13 mation as the Administrator may require; and 

14 (3) provides assurances satisfactory to the Ad15 ministrator that the entity will use the allocation to 

16 supplement, but not supplant, funds made available 

17 to carry out the incentive program. 

18 (c) AMOUNT OF ALLOCATIONS.—For each fiscal year, 

19 the Administrator shall determine the amount to allocate 

20 to each eligible entity to carry out subsection (d), taking 

21 into consideration— 

22 (1) the population served by the eligible entity 

23 during the most recent calendar year for which data 

24 are available; 


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1 (2) the targeted population of the incentive pro2 gram of the eligible entity, such as general households, 

3 low-income households, or first-time homeowners, and 

4 the probable effectiveness of the incentive program for 

5 that population; 

6 (3) for existing programs, the effectiveness of the 

7 program in encouraging the adoption of water-effi8 cient products, buildings, landscapes, facilities, proc9 esses, and services; 

10 (4) any allocation to the eligible entity for a pre11 ceding fiscal year that remains unused; and 

12 (5) the per capita water demand of the popu13 lation served by the eligible entity during the most re14 cent calendar year for which data are available and 

15 the accessibility of water supplies to such entity. 

16 (d) USE OF ALLOCATED FUNDS.—Funds allocated to 

17 an eligible entity under subsection (c) may be used to pay 

18 up to 50 percent of the cost of establishing and carrying 

19 out an incentive program. 

20 (e) FIXTURE RECYCLING.—Eligible entities are en21 couraged to promote or implement fixture recycling pro22 grams to manage the disposal of older fixtures replaced due 

23 to the incentive program under this section. 

24 (f) ISSUANCE OF INCENTIVES.— 


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1 (1) IN GENERAL.—Financial incentives may be 

2 provided to residential consumers that meet the re3 quirements of the applicable incentive program. 

4 (2) MANNER OF ISSUANCE.—An eligible entity 

5 may— 

6 (A) issue all financial incentives directly to 

7 residential consumers; or 

8 (B) with approval of the Administrator, 

9 delegate all or part of financial incentive admin10 istration to other organizations, including local 

11 governments, municipal water authorities, water 

12 utilities, and non-profit organizations. 

13 (3) AMOUNT.—The amount of a financial incen14 tive shall be determined by the eligible entity, taking 

15 into consideration— 

16 (A) the amount of any Federal or State in17 centive available for the purchase of the residen18 tial water-efficient product or service; 

19 (B) the amount necessary to change con20 sumer behavior to purchase water-efficient prod21 ucts and services; and 

22 (C) the consumer expenditures for onsite 

23 preparation, assembly, and original installation 

24 of the product. 


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1 (g) AUTHORIZATION OF APPROPRIATIONS.—There are 

2 authorized to be appropriated to the Administrator to carry 

3 out this section— 

4 (1) $100,000,000 for fiscal year 2010; 

5 (2) $150,000,000 for fiscal year 2011; 

6 (3) $200,000,000 for fiscal year 2012; 

7 (4) $150,000,000 for fiscal year 2013; 

8 (5) $100,000,000 for fiscal year 2014; and 

9 (6) for each subsequent fiscal year, the applicable 

10 amount during the preceding fiscal year, as adjusted 

11 to reflect changes for the 12-month period ending the 

12 preceding November 30 in the Consumer Price Index 

13 for All Urban Consumers published by the Bureau of 

14 Labor Statistics of the Department of Labor. 

15 Subtitle E—Miscellaneous 

16 SEC. 151. OFFICE OF CONSUMER ADVOCACY. 

17 (a) DEFINITIONS.—In this section: 

18 (1) ADVISORY COMMITTEE.—The term ‘‘Advisory 

19 Committee’’ means the Consumer Advocacy Advisory 

20 Committee established under subsection (c)(1). 

21 (2) COMMISSION.—The term ‘‘Commission’’ 

22 means the Federal Energy Regulatory Commission. 

23 (3) ENERGY CUSTOMER.—The term ‘‘energy cus24 tomer’’ means a residential customer or a small com25 mercial customer that receives products or services 


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1 from a public utility or natural gas company under 

2 the jurisdiction of the Commission. 

3 (4) NATURAL GAS COMPANY.—The term ‘‘natural 

4 gas company’’ has the meaning given the term in sec5 tion 2 of the Natural Gas Act (15 U.S.C. 717a). 

6 (5) OFFICE.—The term ‘‘Office’’ means the Office 

7 of Consumer Advocacy established by subsection 

8 (b)(1). 

9 (6) PUBLIC UTILITY.—The term ‘‘public utility’’ 

10 has the meaning given the term in section 201(e) of 

11 the Federal Power Act (16 U.S.C. 824(e)). 

12 (7) SMALL COMMERCIAL CUSTOMER.—The term 

13 ‘‘small commercial customer’’ means a commercial 

14 customer that has a peak demand of not more than 

15 1,000 kilowatts per hour. 

16 (b) OFFICE.— 

17 (1) ESTABLISHMENT.—There is established an 

18 Office of Consumer Advocacy to serve as an advocate 

19 for the public interest. 

20 (2) DIRECTOR.—The Office shall be headed by a 

21 Director to be appointed by the President, who is ad22 mitted to the Federal Bar, with experience in public 

23 utility proceedings, and by and with the advice and 

24 consent of the Senate. 

25 (3) DUTIES.—The Office may— 


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1 (A) represent, and appeal on behalf of, en2 ergy customers on matters concerning rates or 

3 service of public utilities and natural gas compa4 nies under the jurisdiction of the Commission— 

5 (i) at hearings of the Commission; 

6 (ii) in judicial proceedings in the 

7 courts of the United States; and 

8 (iii) at hearings or proceedings of other 

9 Federal regulatory agencies and commis10 sions; 

11 (B) monitor and review energy customer 

12 complaints and grievances on matters concerning 

13 rates or service of public utilities and natural 

14 gas companies under the jurisdiction of the Com15 mission; 

16 (C) investigate independently, or within the 

17 context of formal proceedings, the services pro18 vided by, the rates charged by, and the valuation 

19 of the properties of, public utilities and natural 

20 gas companies under the jurisdiction of the Com21 mission; 

22 (D) develop means, such as public dissemi23 nation of information, consultative services, and 

24 technical assistance, to ensure, to the maximum 

25 extent practicable, that the interests of energy 


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1 consumers are adequately represented in the 

2 course of any hearing or proceeding described in 

3 subparagraph (A); 

4 (E) collect data concerning rates or service 

5 of public utilities and natural gas companies 

6 under the jurisdiction of the Commission; and 

7 (F) prepare and issue reports and rec8 ommendations. 

9 (4) COMPENSATION AND POWERS.—The Director 

10 may— 

11 (A) employ and fix the compensation of 

12 such staff personnel as is deemed necessary; and 

13 (B) procure temporary and intermittent 

14 services as needed. 

15 (5) ACCESS TO INFORMATION.—Each depart16 ment, agency, and instrumentality of the Federal 

17 Government is authorized and directed to furnish to 

18 the Director such reports and other information as he 

19 deems necessary to carry out his functions under this 

20 section. 

21 (c) CONSUMER ADVOCACY ADVISORY COMMITTEE.— 

22 (1) ESTABLISHMENT.—The Director shall estab23 lish an advisory committee, to be known as Consumer 

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1 ices, and disputes and to make recommendations to 

2 the Director. 

3 (2) COMPOSITION.—The Director shall appoint 5 

4 members to the Advisory Committee including— 

5 (A) 2 individuals representing State Utility 

6 Consumer Advocates; and 

7 (B) 1 individual, from a nongovernmental 

8 organization, representing consumers. 

9 (3) MEETINGS.—The Advisory Committee shall 

10 meet at such frequency as may be required to carry 

11 out its duties. 

12 (4) REPORTS.—The Director shall provide for 

13 publication of recommendations of the Advisory Com14 mittee on the public website established for the Office. 

15 (5) DURATION.—Notwithstanding any other pro16 vision of law, the Advisory Committee shall continue 

17 in operation during the period in which the Office ex18 ists. 

19 (6) APPLICATION OF FACA.—Except as otherwise 

20 specifically provided, the Advisory Committee shall be 

21 subject to the Federal Advisory Committee Act. 

22 (d) AUTHORIZATION OF APPROPRIATIONS.—There are 

23 authorized such sums as necessary to carry out this section. 


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1 (e) SAVINGS CLAUSE.—Nothing in this section affects 

2 the rights or obligations of State Utility Consumer Advo3 cates. 

4 SEC. 152. CLEAN TECHNOLOGY BUSINESS COMPETITION 

5 GRANT PROGRAM. 

6 (a) IN GENERAL.—The Administrator may provide 

7 grants to organizations to conduct business competitions 

8 that provide incentives, training, and mentorship to entre9 preneurs and early stage start-up companies throughout the 

10 United States to meet high-priority economic, environ11 mental, and energy goals in areas including air quality, 

12 energy efficiency and renewable energy, transportation, 

13 water quality and conservation, green buildings, and waste 

14 management. 

15 (b) PURPOSES.— 

16 (1) IN GENERAL.—The competitions described in 

17 subsection (a) shall have the purposes of— 

18 (A) accelerating the development and de19 ployment of clean technology businesses and 

20 green jobs; 

21 (B) stimulating green economic develop22 ment; 

23 (C) providing business training and men24 toring to early stage clean technology companies; 

25 and 


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1 (D) strengthening the competitiveness of 

2 United States clean technology industry in world 

3 trade markets. 

4 (2) PRIORITY.—Priority shall be given to busi5 ness competitions that— 

6 (A) are led by the private sector; 

7 (B) encourage regional and interregional 

8 cooperation; and 

9 (C) can demonstrate market-driven prac10 tices and the creation of cost-effective green jobs 

11 through an annual publication of competition 

12 activities and directory of companies. 

13 (c) ELIGIBILITY.— 

14 (1) IN GENERAL.—To be eligible for a grant 

15 under this section, an organization shall be any spon16 sored entity of an organization described in subpara17 graph (A) that is operated as a nonprofit entity. 

18 (2) PRIORITY.—In making grants under this sec19 tion, the Administrator shall give priority to organi20 zations that can demonstrate broad funding support 

21 from private and other non-Federal funding sources 

22 to leverage Federal investment. 

23 (d) AUTHORIZATION OF APPROPRIATIONS.—There is 

24 authorized to be appropriated to carry out this section 

25 $20,000,000. 


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1 SEC. 153. PRODUCT CARBON DISCLOSURE PROGRAM. 

2 (a) EPA STUDY.—The Administrator shall conduct a 

3 study to determine the feasibility of establishing a national 

4 program for measuring, reporting, publicly disclosing, and 

5 labeling products or materials sold in the United States for 

6 their carbon content, and shall, not later than 18 months 

7 after the date of enactment of this Act, transmit a report 

8 to Congress which shall include the following: 

9 (1) A determination of whether a national prod10 uct carbon disclosure program and labeling program 

11 would be effective in achieving the intended goals of 

12 achieving greenhouse gas reductions and an examina13 tion of existing programs globally and their strengths 

14 and weaknesses. 

15 (2) Criteria for identifying and prioritizing sec16 tors and products and processes that should be covered 

17 in such program or programs. 

18 (3) An identification of products, processes, or 

19 sectors whose inclusion could have a substantial car20 bon impact (prioritizing industrial products such as 

21 iron and steel, aluminum, cement, chemicals, and 

22 paper products, and also including food, beverage, hy23 giene, cleaning, household cleaners, construction, met24 als, clothing, semiconductor, and consumer elec25 tronics). 


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1 (4) Suggested methodology and protocols for 

2 measuring the carbon content of the products across 

3 the entire carbon lifecycle of such products for use in 

4 a carbon disclosure program and labeling program. 

5 (5) A review of existing greenhouse gas product 

6 accounting standards, methodologies, and practices 

7 including the Greenhouse Gas Protocol, ISO 14040/ 

8 44, ISO 14067, and Publically Available Specifica9 tion 2050, and including a review of the strengths 

10 and weaknesses of each. 

11 (6) A survey of secondary databases including 

12 the Manufacturing Energy Consumption Survey, an 

13 evaluation of the quality of data for use in a product 

14 carbon disclosure program and product carbon label15 ing program, an identification of gaps in the data 

16 relative to the potential purposes of a national prod17 uct carbon disclosure program and product carbon la18 beling program, and development of recommendations 

19 for addressing these data gaps. 

20 (7) An assessment of the utility of comparing 

21 products and the appropriateness of product carbon 

22 standards. 

23 (8) An evaluation of the information needed on 

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1 ing what pieces of quantitative and qualitative infor2 mation need to be disclosed. 

3 (9) An evaluation of the appropriate boundaries 

4 of the carbon lifecycle analysis for different sectors 

5 and products. 

6 (10) An analysis of whether default values should 

7 be developed for products whose producer does not 

8 participate in the program or does not have data to 

9 support a disclosure or label and a determination of 

10 the best ways to develop such default values. 

11 (11) A recommendation of certification and 

12 verification options necessary to assure the quality of 

13 the information and avoid greenwashing or the use of 

14 insubstantial or meaningless environmental claims to 

15 promote a product. 

16 (12) An assessment of options for educating con17 sumers about product carbon content and the product 

18 carbon disclosure program and product carbon label19 ing program. 

20 (13) An analysis of the costs and timelines asso21 ciated with establishing a national product carbon 

22 disclosure program and product carbon labeling pro23 gram, including options for a phased approach. Costs 

24 should include those for businesses associated with the 

25 measurement of carbon footprints and those associated 


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1 with creating a product carbon label and managing 

2 and operating a product carbon labeling program, 

3 and options for minimizing these costs. 

4 (14) An evaluation of incentives (such as finan5 cial incentives, brand reputation, and brand loyalty) 

6 to determine whether reductions in emissions can be 

7 accelerated through encouraging more efficient manu8 facturing or by encouraging preferences for lower9 emissions products to substitute for higher-emissions 

10 products whose level of performance is no better. 

11 (b) DEVELOPMENT OF NATIONAL CARBON DISCLO12 SURE PROGRAM.—Upon conclusion of the study, and not 

13 later than 3 years after the date of enactment of this Act, 

14 the Administrator shall establish a national product carbon 

15 disclosure program, participation in which shall be vol16 untary, and which may involve a product carbon label with 

17 broad applicability to the wholesale and consumer markets 

18 to enable and encourage knowledge about carbon content by 

19 producers and consumers and to inform efforts to reduce 

20 energy consumption (carbon dioxide equivalent emissions) 

21 nationwide. In developing such a program, the Adminis22 trator shall— 

23 (1) consider the results of the study conducted 

24 under subsection (a); 


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1 (2) consider existing and planned programs and 

2 proposals and measurement standards (including the 

3 Publicly Available Specification 2050, standards to be 

4 developed by the World Resource Institute/World 

5 Business Council for Sustainable Development, the 

6 International Standards Organization, and the bill 

7 AB19 pending in the California legislature as of the 

8 date of enactment of this Act); 

9 (3) consider the compatibility of a national 

10 product carbon disclosure program with existing pro11 grams; 

12 (4) utilize incentives and other means to spur 

13 the adoption of product carbon disclosure and product 

14 carbon labeling; 

15 (5) develop protocols and parameters for a prod16 uct carbon disclosure program, including a method17 ology and formula for assessing, verifying, and poten18 tially labeling a product’s greenhouse gas content, and 

19 for data quality requirements to allow for product 

20 comparison; 

21 (6) create a means to— 

22 (A) document best practices; 

23 (B) ensure clarity and consistency; 

24 (C) work with suppliers, manufacturers, 

25 and retailers to encourage participation; 


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1 (D) ensure that protocols are consistent and 

2 comparable across like products; and 

3 (E) evaluate the effectiveness of the pro4 gram; 

5 (7) make publicly available information on 

6 product carbon content to ensure transparency; 

7 (8) provide for public outreach, including a con8 sumer education program to increase awareness; 

9 (9) develop training and education programs to 

10 help businesses learn how to measure and commu11 nicate their carbon footprint and easy tools and tem12 plates for businesses to use to reduce cost and time to 

13 measure their products’ carbon lifecycle; 

14 (10) consult with the Secretary of Energy, the 

15 Secretary of Commerce, the Federal Trade Commis16 sion, and other Federal agencies, as necessary; 

17 (11) gather input from stakeholders through con18 sultations, public workshops, or hearings with rep19 resentatives of consumer product manufacturers, con20 sumer groups, and environmental groups; 

21 (12) utilize systems for verification and product 

22 certification that will ensure that claims manufactur23 ers make about their products are valid; 

24 (13) create a process for reviewing the accuracy 

25 of product carbon label information and protecting 


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1 the product carbon label in the case of a change in 

2 the product’s energy source, supply chain, ingredients, 

3 or other factors, and specify the frequency to which 

4 data should be updated; and 

5 (14) develop a standardized, easily understand6 able carbon label, if appropriate, and create a process 

7 for responding to inaccuracies and misuses of such a 

8 label. 

9 (c) REPORT TO CONGRESS.—Not later than 5 years 

10 after the program is established pursuant to subsection (b), 

11 the Administrator shall report to Congress on the effective12 ness and impact of the program, the level of voluntary par13 ticipation, and any recommendations for additional meas14 ures. 

15 (d) DEFINITIONS.—In this section: 

16 (1) The term ‘‘carbon content’’ means the quan17 tity of greenhouse gas emissions and the warming im18 pact of those emissions on the atmosphere expressed in 

19 carbon dioxide equivalent associated with a product’s 

20 value chain. 

21 (2) The term ‘‘carbon footprint’’ means the level 

22 of greenhouse gas emissions produced by a particular 

23 activity, service, or entity. 

24 (3) The term ‘‘carbon lifecycle’’ means the green25 house gas emissions that are released as part of the 


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1 processes of creating, producing, processing, manufac2 turing, modifying, transporting, distributing, storing, 

3 using, recycling, or disposing of goods and services. 

4 (e) AUTHORIZATION OF APPROPRIATIONS.—There is 

5 authorized to be appropriated to the Administrator— 

6 (1) to carry out the study required by subsection 

7 (a), $5,000,000; and 

8 (2) to carry out the program required under sub9 section (b), $25,000,000 for each of fiscal years 2010 

10 through 2025. 

11 SEC. 154. STATE RECYCLING PROGRAMS. 

12 (a) ESTABLISHMENT.—The Administrator shall estab13 lish a State Recycling Program governing the use of funds 

14 by States in accordance with this Act. 

15 (b) USE OF FUNDING.— 

16 (1) IN GENERAL.—States receiving funding to 

17 carry out this section shall use the proceeds to carry 

18 out recycling programs, including reuse programs, in 

19 accordance with this section. 

20 (2) COUNTY AND MUNICIPAL PROGRAMS.—Subject to subsection (d), not less than 1 21 ⁄4 of the funding 

22 made available to a State to carry out this section 

23 shall be distributed by the State to county and munic24 ipal recycling and reuse programs (or to State recy25 cling and reuse programs, if that State does not have 


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1 a county or municipal program) as described in sub2 section (c)(1), to be used exclusively to support recy3 cling and reuse purposes and associated source reduc4 tion purposes, including to provide incentives— 

5 (A) for recycling- and reuse-related tech6 nology that— 

7 (i) reduces or avoids greenhouse gas 

8 emissions; 

9 (ii) increases collection rates; 

10 (iii) improves the quality of recyclable 

11 material that is separated from solid waste; 

12 or 

13 (iv) increases the reuse of products that 

14 would otherwise be disposed; 

15 (B) for energy-efficiency projects for trans16 portation fleets and recycling equipment used to 

17 collect and sort recyclable material and reusable 

18 products separated from solid waste; 

19 (C) for recycling and reuse program-related 

20 expenses, including— 

21 (i) education and job training; 

22 (ii) development and implementation 

23 of variable rate (commonly referred to as 

24 ‘‘pay-as-you-throw’’) funding programs and 


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1 composting, including anaerobic digestion 

2 programs; 

3 (iii) promotion of public space recy4 cling programs; 

5 (iv) approaches for assuring compli6 ance with recycling and reuse requirements; 

7 and 

8 (v) development or implementation of 

9 best practices for municipal solid waste re10 duction and reuse programs; and 

11 (vi) incentives for the deployment of 

12 reuse technology and equipment that re13 duces or avoids greenhouse gas emissions; 

14 and 

15 (D) to ensure that recyclable materials and 

16 reusable products are not sent for disposal or in17 cineration during fluctuating markets. 

18 (3) RECYCLING AND REUSE FACILITIES.—Subject 

to subsection (d), not less than 1 19 ⁄4 of the funding made 

20 available to a State to carry out this section shall be 

21 distributed by the State to eligible recycling and reuse 

22 facilities as described in subsection (c)(2) to be used 

23 exclusively to support the recycling purposes and as24 sociated source reduction purposes of the facilities, in25 cluding to provide— 


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1 (A) incentives for the demonstration or de2 ployment of recycling- and reuse-related tech3 nology and equipment that reduce or avoid 

4 greenhouse gas emissions; 

5 (B) incentives to facilities that increase the 

6 quantity and quality of recyclable material or 

7 reusable products that are recycled or reused 

8 versus sent for disposal or incineration; 

9 (C) funding for research, management, and 

10 removal of impediments to recycling and reuse, 

11 including— 

12 (i) radioactive material; 

13 (ii) devices or materials that contain 

14 polychlorinated biphenyls, mercury, or 

15 chlorofluorocarbons; 

16 (iii) improved collection systems; and 

17 (iv) production of products that are re18 usable; 

19 (D) funding for research on, and develop20 ment and deployment of, new technologies to 

21 more efficiently and effectively recycle items and 

22 reuse products such as automobile shredder res23 idue, cathode ray tubes, plastics, and tires; and 

24 (E) incentives to recycle materials and 

25 reuse products identified by the Administrator 


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1 that are not being recycled at a recycling facil2 ity. 

3 (4) MANUFACTURING FACILITIES.—Subject to 

subsection (d), not less than 1 4 ⁄4 of the funding made 

5 available to a State to carry out this section shall be 

6 distributed by the State to eligible manufacturing fa7 cilities as described in subsection (c)(3) to be used ex8 clusively to support recycling and reuse purposes, in9 cluding to provide incentives for the demonstration or 

10 deployment of— 

11 (A) manufacturing-related technology and 

12 equipment that would increase the use of recycla13 ble material and the reuse of products and avoid 

14 or reduce greenhouse gas emissions; 

15 (B) radiation detection equipment and the 

16 costs associated with recovery of detected radi17 ated recyclable material; 

18 (C) technologies that will detect and sepa19 rate contaminants, including mercury-, lead-, 

20 and cadmium-containing devices; 

21 (D) strategies and technologies to remove 

22 impediments to recovering recyclable material 

23 and product reuse; and 

24 (E) strategies and technologies to improve 

25 the energy efficiency of technology and equipVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00984 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ment used to manufacture recyclable and reus2 able products. 

(5) REUSE FACILITIES.—Not more than 1 3 ⁄4 of the 

4 funding made available to a State to carry out this 

5 section may be distributed by the State to eligible 

6 reuse facilities described in subsection (c)(4), to be 

7 used exclusively to support the reuse purposes and as8 sociated source reduction purposes of the facilities, in9 cluding to provide— 

10 (A) incentives for the demonstration or de11 ployment of reuse-related technology and equip12 ment that reduces or avoids greenhouse gas emis13 sions; 

14 (B) incentives to facilities that increase the 

15 quantity and quality of products and materials 

16 that are reused versus sent for disposal or incin17 eration; 

18 (C) funding for research, management, and 

19 removal of impediments to reuse, including— 

20 (i) improved collection systems; and 

21 (ii) production of products that are re22 usable; 

23 (D) funding for research on, and develop24 ment and deployment of, new technologies to 


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1 more efficiently and effectively reuse products; 

2 and 

3 (E) other incentives to reuse products, as 

4 identified by the Administrator. 

5 (c) ELIGIBILITY REQUIREMENTS.— 

6 (1) COUNTY AND MUNICIPALITY PROGRAMS.— 

7 Funds provided under subsection (b)(2) shall be pro8 vided on a competitive basis to county and municipal 

9 recycling and reuse programs that— 

10 (A) have within the solid waste manage11 ment plans of the programs a recycling and 

12 reuse management plan that includes an edu13 cation outreach program for the individuals and 

14 entities served by the program constituency that 

15 highlights the lifecycle benefits of recycling; and 

16 (B) collect at least 5 types of recyclable or 

17 reusable materials, such as— 

18 (i) ferrous and nonferrous metal; 

19 (ii) aluminum; 

20 (iii) plastic; 

21 (iv) tires and rubber; 

22 (v) household electronic equipment; 

23 (vi) glass; 

24 (vii) scrap food; 

25 (viii) recoverable fiber or paper; 


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1 (ix) textiles; and 

2 (x) consumer packing; 

3 (C) demonstrate, not later than 3 years 

4 after the date of receipt of funds under this sub5 title, reasonable progress toward achieving— 

6 (i) a collection rate goal of at least 30 

7 percent of the total recyclable or reusable 

8 materials available from the solid waste 

9 stream in the requesting State, county, or 

10 municipal program; or 

11 (ii) a 10-percent increase of collected 

12 recyclable materials compared to the total 

13 solid waste stream in the requesting State, 

14 county, or municipal program; and 

15 (D)(i) own, operate, or contract to handle, 

16 operate, or sell 1 or more of— 

17 (I) a curbside recyclables collection 

18 program; 

19 (II) a redemption center or drop-off fa20 cility for recyclables or reusable products; or 

21 (III) a materials recovery facility; and 

22 (ii) have in place a quality, environmental, 

23 health, and safety management system (such as 

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1 duce the operational carbon baselines of the pro2 grams. 

3 (2) RECYCLING AND REUSE FACILITIES.—Funds 

4 provided under subsection (b)(3) shall be provided on 

5 a competitive basis to an existing recycling facility 

6 that— 

7 (A) processes recyclable material into com8 mercial specification-grade commodities for use 

9 as raw material feed stock at recovery facilities, 

10 including for use as— 

11 (i) a replacement or substitute for a 

12 virgin raw material; or 

13 (ii) a replacement or substitute for a 

14 product made, in whole or in part, from a 

15 virgin raw material; 

16 (B) has a verifiable carbon baseline; and 

17 (C) has an environmental, health and safe18 ty, and quality management system (such as 

19 that of the International Standards Organiza20 tion or an equivalent) that includes goals to re21 duce the operational carbon baseline of the recy22 cling facility per unit of material processed. 

23 (3) MANUFACTURING FACILITY.—Funds provided 

24 under subsection (b)(4) shall be provided on a com25 petitive basis to a manufacturing facility that— 


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1 (A) recovers significant recyclable or reus2 able material; 

3 (B) can report on a verifiable carbon base4 line that is consistent with applicable reporting 

5 requirements; and 

6 (C) has an environmental, health and safe7 ty, and quality management system (such as 

8 that of the International Standards Organiza9 tion or an equivalent) that includes— 

10 (i) goals to reduce the operational car11 bon baseline of the manufacturing facility 

12 per unit of material processed; or 

13 (ii) evidence that the reuse of products 

14 processed serves to reduce carbon emissions. 

15 (4) REUSE FACILITIES.—Funds under subsection 

16 (b)(5) may be provided on a competitive basis to an 

17 existing reuse facility that— 

18 (A) processes reusable material to be used as 

19 a replacement or substitute for a new product; 

20 (B) can report on a verifiable carbon base21 line; and 

22 (C) has an environmental, health and safe23 ty, and quality management system (such as 

24 that of the International Standards Organiza25 tion or an equivalent) that includes goals to reVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00989 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 duce the operational carbon baseline of the reuse 

2 facility per unit of material processed, or evi3 dence that the reuse of products processed serves 

4 to reduce carbon emissions. 

5 (d) REPORTING.—Each State that distributes funds 

6 under this section shall submit to the Administrator, in ac7 cordance with such requirements as the Administrator may 

8 prescribe, a report that includes— 

9 (1) a list of entities receiving funding under this 

10 section, including entities receiving such funding from 

11 units of local government pursuant to subsection 

12 (b)(2); 

13 (2) the amount of funding received by each such 

14 recipient; 

15 (3) the specific purposes for which the funding 

16 was conveyed to each such recipient; and 

17 (4) documentation of the quantity of net recycla18 ble materials and reusable products that were col19 lected and processed and greenhouse gas emissions 

20 that were reduced or avoided accordingly, through use 

21 of the funding, based on a lifecycle calculation devel22 oped by the Administrator. 

23 (e) METHODOLOGY AND DECISIONMAKING.—The Ad24 ministrator, as appropriate— 


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1 (1) shall develop and periodically update 

2 lifecycle methods to quantify the relationship between 

3 waste management decisions, including recycling, 

4 reuse, and waste reduction, greenhouse gas reductions, 

5 and energy use reductions, for purposes that in6 clude— 

7 (A) helping to support decisions under Fed8 eral, State, and municipal recycling, reuse, and 

9 waste management programs, including— 

10 (i) estimating greenhouse gas and en11 ergy benefits of expanding recycling and 

12 reuse programs; 

13 (ii) comparing the benefits of recycling, 

14 reuse, and waste reduction to other green15 house gas and energy use reduction strate16 gies; 

17 (iii) optimizing waste management 

18 strategies to maximize greenhouse gas re19 ductions and energy use reductions; and 

20 (iv) public education; and 

21 (B) designing products to optimize waste 

22 reduction, reuse, and recycling opportunities and 

23 use of recycled materials in the manufacturing 

24 process; 


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1 (2) may collect data to support the development 

2 of the methods described in paragraph (1); and 

3 (3) to improve national consistency, shall, in 

4 consultation with appropriate State and local rep5 resentatives and municipal recycling programs, iden6 tify best practices to promote improvement in, and 

7 support State efforts in improving, municipal recy8 cling, reuse, and resource recovery programs. 

9 SEC. 155. SUPPLEMENTAL AGRICULTURE, ABANDONED 

10 MINE LAND, AND FORESTRY GREENHOUSE 

11 GAS REDUCTION AND RENEWABLE ENERGY 

12 PROGRAM. 

13 (a) AGRICULTURAL GREENHOUSE GAS REDUC14 TIONS.— 

15 (1) ESTABLISHMENT.— 

16 (A) IN GENERAL.—The Secretary of Agri17 culture (referred to in this section as the ‘‘Sec18 retary’’), in coordination with the Secretary of 

19 the Interior, shall establish a Greenhouse Gas 

20 Reduction Incentives Program (referred to in 

21 this section as the ‘‘program’’) to provide finan22 cial assistance to owners and operators of agri23 cultural land (including land on which specialty 

24 crops are produced and private or public land 

25 used for grazing), private or public abandoned 


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1 mine land, and forest land for projects and ac2 tivities that measurably increase carbon seques3 tration or reduce greenhouse gas emissions. 

4 (B) SHARED AUTHORITY.—The Secretary 

5 shall delegate to the Secretary of the Interior the 

6 authority to carry out projects on land under the 

7 jurisdiction of or operated by the Department of 

8 the Interior. 

9 (2) PRIORITY.—In carrying out the program, the 

10 Secretary shall give priority to projects or activities 

11 that— 

12 (A) reduce greenhouse gas emissions or in13 crease sequestration of greenhouse gases, and 

14 achieve significant other environmental benefits, 

15 such as the improvements of water or air quality 

16 or natural resources in agricultural, abandoned 

17 mine land, and forestry operations; and 

18 (B) reduce greenhouse gas emissions or se19 quester carbon in agricultural and forestry oper20 ations where there are limited recognized oppor21 tunities to achieve such emission reductions or 

22 sequestration. 

23 (3) ELIGIBLE PROJECTS AND ACTIVITIES.—Eli24 gible projects and payments shall include those that— 


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1 (A) reflect the comparable amount that the 

2 owners or operators would receive in the offset 

3 market if not for compliance with environmental 

4 laws that preclude the owners and operators 

5 from being eligible for receiving an offset credit 

6 under a Federal law enacted for the purpose of 

7 regulating greenhouse gas emissions; 

8 (B) provide greenhouse gas emission bene9 fits, but do not receive an offset credit or qualify 

10 for an early action allowance under a Federal 

11 law enacted for the purpose of regulating green12 house gas emissions, including projects and ac13 tivities that provide an opportunity to dem14 onstrate and test new or uncertain methods to 

15 reduce or sequester emissions; 

16 (C) reward early adopters, including pro17 ducers that practice no-till agriculture, and en18 sure that individuals and entities that took ac19 tion prior to the implementation of a Federal 

20 law enacted for the purpose of regulating green21 house gas emissions are not placed at a competi22 tive disadvantage, including giving consideration 

23 to owners or operators located in jurisdictions 

24 with more stringent environmental laws (includ25 ing regulations), compliance with which preVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 00994 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 cludes the owners or operators from partici2 pating such an offset market; 

3 (D) provide incentives for supplemental 

4 greenhouse gas emission reductions on private 

5 and public forest land of the United States; 

6 (E) prevent conversion of land, including 

7 native grassland, native prairie, rangeland, 

8 cropland, or forested land, that would increase 

9 greenhouse gas emissions or a loss of carbon se10 questration; 

11 (F) promote the recovery and reuse of aban12 doned mine land that otherwise would increase 

13 greenhouse gas emissions or cause a loss of car14 bon sequestration, provided that not more than 5 

15 percent of the total value of the forms of assist16 ance provided under the program for each year 

17 shall be used for the projects and activities de18 scribed in this subparagraph; or 

19 (G) support action on Federal, State, or 

20 tribal land that encourages improvements and 

21 management practices that include carbon se22 questration benefits. 

23 (4) REQUIREMENT.—Financial incentives and 

24 support provided by the Secretary for a project or ac25 tivity under this section shall, to the maximum extent 


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1 practicable, be directly proportional to the quantity 

2 and duration of greenhouse gas emissions reduced or 

3 carbon sequestered. 

4 (5) OTHER PROJECTS.—The Secretary shall con5 sider projects and activities that complement and le6 verage existing conservation, forestry, and energy pro7 gram expenditures to provide measurable emission re8 duction and sequestration benefits that otherwise may 

9 not take place or continue to exist. 

10 (6) ELIGIBILITY.—An owner or operator shall 

11 not be prohibited from participating in the program 

12 established under this section due to participation of 

13 the owner or operator in other Federal or State con14 servation or agricultural assistance programs. 

15 (7) FORMS OF ASSISTANCE.—The Secretary may 

16 use any of the following to provide assistance under 

17 this section: 

18 (A) Permanent conservation easements, for 

19 which the Secretary shall give priority in pro20 viding assistance under this section. 

21 (B) Carbon sequestration or carbon mitiga22 tion contracts between the owner or operator and 

23 the Secretary for the performance of projects or 

24 activities that provide a measurable reduction in 

25 greenhouse gas emissions or sequester carbon. 


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1 (C) Financial incentives through land man2 agement contracts or agreements, including tim3 ber sale, service, or stewardship contracts. 

4 (D) Financial incentives through grazing 

5 contracts. 

6 (E) Grants. 

7 (F) Such other forms of assistance as the 

8 Secretary determines to be appropriate. 

9 (8) REVERSALS.—The Secretary shall specify 

10 methods to address intentional or unintentional rever11 sal of carbon sequestration or greenhouse gas emission 

12 reductions that occur during the term of a contract or 

13 easement under this section. 

14 (9) ACCOUNTING SYSTEMS.—In carrying out this 

15 section, the Secretary shall develop and implement— 

16 (A) a national accounting system for carbon 

17 stocks, sequestration, and greenhouse gas emis18 sions that may be used to assess progress in im19 plementing this section at a national level; and 

20 (B) credible reporting and accounting sys21 tems to ensure that incentives provided under 

22 this section are achieving stated objectives. 

23 (10) PROGRAM MEASUREMENT, MONITORING, 

24 AND VERIFICATION.—The Secretary, in consultation 

25 with the Administrator— 


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1 (A) shall establish and implement protocols 

2 that provide reasonable monitoring and 

3 verification of compliance with terms associated 

4 with assistance provided under this section, in5 cluding field sampling of actual performance, to 

6 develop annual estimates of emission reductions 

7 achieved under the program; 

8 (B) shall report annually the total number 

9 of tons of carbon dioxide sequestered or the total 

10 number of tons of emissions avoided through in11 centives provided under this section; and 

12 (C) not later than 2 years after the date of 

13 enactment of this Act, and at least every 18 

14 months thereafter, submit to Congress and make 

15 available to the public on the website of the De16 partment of Agriculture a report that includes— 

17 (i) an estimate of annual and cumu18 lative reductions generated through the pro19 gram under this section, determined using 

20 standardized measures (including economic 

21 efficiency); and 

22 (ii) a summary of any changes to the 

23 program, in accordance with this section, 

24 that will be made as a result of program 


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1 measurement, monitoring, and verification 

2 conducted under this section. 

3 (b) RESEARCH PROGRAM.—The Secretary shall estab4 lish by rule a program to conduct research to develop addi5 tional projects and activities for crops to find additional 

6 techniques and methods to reduce greenhouse gas emissions 

7 or sequester greenhouse gases that may or may not meet 

8 criteria for a Federal law enacted for the purpose of regu9 lating greenhouse gas emissions. 

10 SEC. 156. ECONOMIC DEVELOPMENT CLIMATE CHANGE 

11 FUND. 

12 (a) IN GENERAL.—Title II of the Public Works and 

13 Economic Development Act of 1965 (42 U.S.C. 3141 et seq.) 

14 is amended by adding at the end the following: 

15 ‘‘SEC. 219. ECONOMIC DEVELOPMENT CLIMATE CHANGE 

16 FUND. 

17 ‘‘(a) IN GENERAL.—On the application of an eligible 

18 recipient, the Secretary may provide technical assistance, 

19 make grants, enter into contracts, or otherwise provide 

20 amounts for projects— 

21 ‘‘(1) to promote energy efficiency to enhance eco22 nomic competitiveness; 

23 ‘‘(2) to increase the use of renewable energy re24 sources to support sustainable economic development 

25 and job growth; 


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1 ‘‘(3) to support the development of conventional 

2 energy resources to produce alternative transportation 

3 fuels, electricity and heat; 

4 ‘‘(4) to develop energy efficient or environ5 mentally sustainable infrastructure; 

6 ‘‘(5) to promote environmentally sustainable eco7 nomic development practices and models; 

8 ‘‘(6) to support development of energy efficiency 

9 and alternative energy development plans, studies or 

10 analysis, including enhancement of new and existing 

11 Comprehensive Economic Development Strategies 

12 funded under this Act; and 

13 ‘‘(7) to supplement other Federal grants, loans, 

14 or loan guarantees for purposes described in para15 graphs (1) through (6). 

16 ‘‘(b) FEDERAL SHARE.—The Federal share of the cost 

17 of any project carried out under this section shall not exceed 

18 80 percent, except that the Federal share of a Federal grant, 

19 loan, or loan guarantee provided under subsection (a)(7) 

20 may be 100 percent. 

21 ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There is 

22 authorized to be appropriated to carry out this section 

23 $50,000,000 for each of fiscal years 2009 through 2013, to 

24 remain available until expended.’’. 


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1 (b) CONFORMING AMENDMENT.—The table of contents 

2 contained in section 1(b) of the Public Works and Economic 

3 Development Act of 1965 (42 U.S.C. 3141 et seq.)is amend4 ed by inserting after the item relating to section 218 the 

5 following: 

‘‘Sec. 219. Economic Development Climate Change Fund.’’. 

6 SEC. 157. STUDY OF RISK-BASED PROGRAMS ADDRESSING 

7 VULNERABLE AREAS. 

8 (a) IN GENERAL.—The Administrator, or the heads of 

9 such other Federal agencies as the President may designate, 

10 shall conduct a study and, not later than 2 years after the 

11 date of enactment of this Act, submit to Congress a report 

12 regarding risk-based policies and programs addressing vul13 nerable areas. 

14 (b) REQUIREMENTS.—The report shall 

15 (1) review and assess Federal predisaster mitiga16 tion, emergency response, and flood insurance policies 

17 and programs that affect areas vulnerable to the im18 pacts of climate change; 

19 (2) describe strategies for better addressing such 

20 vulnerabilities and provide implementation rec21 ommendations; 

22 (3) assess whether the policies and programs de23 scribed in paragraph (1) support the State and tribal 

24 response and adaptation goals and objectives identi25 fied under this Act; 


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1 (4) identify, and make recommendations to re2 solve, inconsistencies in Federal policies and pro3 grams in effect as of the date of enactment of this Act 

4 that address areas vulnerable to climate change; and 

5 (5) identify annual cost savings to the Federal 

6 Government associated with the implementation of the 

7 strategies and recommendations contained in the re8 port. 

9 SEC. 158. EFFICIENT BUILDINGS PROGRAM. 

10 (a) IN GENERAL.—The Administrator shall establish 

11 and carry out a program, to be known as the ‘‘Efficient 

12 Buildings Program’’, to achieve greenhouse gas reductions 

13 by providing assistance to owners of buildings in the United 

14 States as a reward for— 

15 (1) constructing highly efficient buildings in the 

16 United States; or 

17 (2) increasing the efficiency of existing buildings 

18 in the United States. 

19 (b) REQUIREMENTS.—The Administrator shall provide 

20 assistance under this section to owners of buildings in the 

21 United States based on the extent to which projects relating 

22 to the buildings of the owners result in verifiable, addi23 tional, and enforceable improvements in energy perform24 ance— 


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1 (1) in new or renovated buildings that dem2 onstrate exemplary performance by achieving— 

3 (A) a minimum score of 75 on the 

4 benchmarking tool of the Energy Star program 

5 established by section 324A of the Energy Policy 

6 and Conservation Act (42 U.S.C. 6294a); or 

7 (B) an equivalent score on an established 

8 energy performance benchmarking metric selected 

9 by the Administrator; and 

10 (2) in retrofitted existing buildings that dem11 onstrate— 

12 (A) substantial improvement in the score or 

13 rating on the benchmarking tool described in 

14 paragraph (1)(A) by a minimum of 30 points; 

15 or 

16 (B) an equivalent improvement using an es17 tablished performance benchmarking metric se18 lected by the Administrator. 

19 (c) PRIORITY.—In providing assistance under this sec20 tion, the Administrator shall give priority to projects— 

21 (1) completed by building owners with a proven 

22 track record of building energy performance; or 

23 (2) that result in measurable greenhouse gas re24 duction benefits not encompassed within the metrics 


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1 of the Energy Star program described in subsection 

2 (b)(1)(A). 

3 Subtitle F—Energy Efficiency and 

4 Renewable Energy 

5 SEC. 161. RENEWABLE ENERGY. 

6 (a) DEFINITIONS.—In this section: 

7 (1) RENEWABLE ENERGY.—The term ‘‘renewable 

8 energy’’ means electric energy generated from solar, 

9 wind, biomass, landfill gas, ocean (including tidal, 

10 wave, current, and thermal), geothermal, municipal 

11 solid waste, or new hydroelectric generation capacity 

12 achieved from increased efficiency or additions of new 

13 capacity at an existing hydroelectric project. 

14 (2) RENEWABLE PORTFOLIO STANDARD.—The 

15 term ‘‘ ‘renewable portfolio standard’ ’’ means a state 

16 statute that requires electricity providers to obtain a 

17 minimum percentage of their power from renewable 

18 energy resources by a certain date. 

19 (b) GRANTS.—The Administrator, in consultation 

20 with the Secretaries of Energy, Interior, and Agriculture, 

21 may provide grants for projects to increase the quantity of 

22 energy a State uses from renewable sources under State re23 newable portfolio standard laws. 

24 (c) ELIGIBILITY.—The Administrator shall review for 

25 approval projects applications that are— 


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1 (1) submitted by State and local governments, 

2 Indian tribes, public utilities, regional energy co3 operatives, or individual energy producers from states 

4 with a binding Renewable Portfolio Standard; or 

5 (2) submitted by State and local governments, 

6 Indian tribes, public utilities, or regional energy co7 operatives from states with nonbinding goals for 

8 adoption of renewable energy requirements. 

9 (d) PRIORITY.—The Administrator shall give priority 

10 to project applications that are— 

11 (1) submitted by States with a binding renew12 able portfolio standard; 

13 (2) cost-effective in achieving greater renewable 

14 energy production in each State. 

15 (e) CERTIFICATION.— 

16 (1) IN GENERAL.—The Administrator shall no17 tify in writing the Governor of each eligible State as 

18 described in section (c) at the time at which the Ad19 ministrator begins review of a project application re20 ceived from an eligible entity within the State. 

21 (2) CERTIFICATION.—The Governor shall certify 

22 in writing within 30 days of receipt of the Adminis23 trator’s notification described in subsection (1) that 

24 the project application— 


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1 (A) will assist the State in reaching renew2 able portfolio standard targets under applicable 

3 state laws; and 

4 (B) has secured non-Federal funding sources 

5 that, in conjunction with the requested grant 

6 amount, will be sufficient to complete the renew7 able energy project. 

8 (f) RULEMAKING.— 

9 (1) IN GENERAL.—Not later than 90 days after 

10 the date of enactment of this Act, the Administrator 

11 shall initiate rulemaking procedures necessary to im12 plement this section. 

13 (2) FINAL RULES; ACCEPTANCE OF APPLICA14 TIONS.—Not later than 90 days after the close of the 

15 public comment period relating to the rulemaking de16 scribed in paragraph (1), the Administrator shall— 

17 (A) promulgate final regulations to carry 

18 out this section; and 

19 (B) begin accepting project applications for 

20 review. 

21 (g) REPORTING.—Not later than 180 days after the 

22 date of enactment of this Act, and every 180 days thereafter, 

23 the Administrator shall submit to the Committee on Energy 

24 and Commerce of the House of Representatives and the 

25 Committee on Environment and Public Works of the Senate 


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1 a report specifying, with respect to the program under this 

2 section— 

3 (1) the project applications received; 

4 (2) the project applications approved; 

5 (3) the amount of funding allocated per project; 

6 and 

7 (4) the cumulative benefits of the grant program. 

8 (h) GRANT AMOUNT.—A grant provided under this sec9 tion may be in an amount that does not exceed 50 percent 

10 of the total cost of the renewable energy project to be funded 

11 by the grant. 

12 (i) AUTHORIZATION.—There are authorized to be ap13 propriated such sums as are necessary to carry out this sec14 tion. 

15 SEC. 162. ADVANCED BIOFUELS. 

16 (a) FINDINGS.—Congress finds that— 

17 (1) advanced, environmentally sustainable 

18 biofuels can help promote a safe, secure, and domestic 

19 source of low-carbon fuel; 

20 (2) such biofuels can— 

21 (A) benefit consumers and farmers; 

22 (B) assist in maintaining fuel supplies; and 

23 (C) help to keep commodity prices afford24 able; 


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1 (3) a coordinated research and development ef2 fort is needed to help accelerate commercial-scale de3 velopment of advanced, environmentally sustainable 

4 biofuels; and 

5 (4) facilitating the commercial production of ad6 vanced, environmentally sustainable biofuels can help 

7 to make the United States a leader in developing new 

8 fuel technologies. 

9 (b) DEFINITIONS.—In this section: 

10 (1) ADVANCED GREEN BIOFUEL.—The term ‘‘ad11 vanced green biofuel’’ means an advanced biofuel (as 

12 defined in section 211(o)(1) of the Clean Air Act (42 

13 U.S.C. 7545(o)(1))) that the Administrator deter14 mines— 

15 (A) has lifecycle greenhouse gas emissions 

16 that are at least 60 percent less than the baseline 

17 lifecycle greenhouse gas emissions; 

18 (B) is made from advanced renewable bio19 mass; and 

20 (C) minimizes biorefinery water require21 ments to the maximum extent achievable, taking 

22 into consideration costs and other appropriate 

23 factors. 

24 (2) ADVANCED RENEWABLE BIOMASS.—The term 

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1 mass that is produced using sustainable practices, as 

2 determined by the Administrator, in consultation 

3 with the Secretary of Agriculture, taking into consid4 eration factors such as— 

5 (A) the maintenance and enhancement of 

6 the quality and productivity of the soil; 

7 (B) the conservation of soil, water, energy, 

8 natural resources, and fish and wildlife habitat; 

9 (C) the maintenance and enhancement of 

10 the quality of surface water and groundwater; 

11 (D) the protection of the health and safety 

12 of individuals involved in the production system; 

13 (E) the promotion of the well-being of ani14 mals; 

15 (F) the increase in employment opportuni16 ties in the agricultural sector; and 

17 (G) prevention of the introduction of 

18 invasive species, including consideration of a re19 view by the Invasive Species Council established 

20 by Executive Order 13112 (64 Fed. Reg. 6183 

21 (February 3, 1999)). 

22 (3) PROGRAM.—The term ‘‘Program’’ means the 

23 1,000,000,000-Gallon Challenge Grant Program estab24 lished under subsection (c)(1). 


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1 (4) RENEWABLE BIOMASS.—The term ‘‘renewable 

2 biomass’’ has the meaning given the term in section 

3 211(o)(1) of the Clean Air Act (42 U.S.C. 7545(o)(1)). 

4 (c) 1,000,000,000-GALLON CHALLENGE GRANT PRO5 GRAM.— 

6 (1) ESTABLISHMENT.—The Administrator shall 

7 establish within the Environmental Protection Agency 

8 a program, to be known as the ‘‘1,000,000,000-Gallon 

9 Challenge Grant Program’’, under which the Admin10 istrator shall provide grants in accordance with this 

11 subsection. 

12 (2) APPLICATIONS.— 

13 (A) IN GENERAL.—During each calendar 

14 year for the period described in subparagraph 

15 (B), the Administrator shall solicit applications 

16 for grants under the Program from owners and 

17 operators of projects that, as determined by the 

18 Administrator, have the potential, in the aggre19 gate, to produce up to 500,000,000 gallons in an20 nual domestic production capacity of advanced 

21 green biofuels. 

22 (B) DESCRIPTION OF PERIOD.—The period 

23 referred to in subparagraph (A) is the period 

24 that— 


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1 (i) begins on the date of establishment 

2 of the Program; and 

3 (ii) ends on the date on which, as de4 termined by the Administrator, the Pro5 gram supports projects that have the poten6 tial to produce, or are producing, not less 

7 than 1,000,000,000 gallons in annual do8 mestic production capacity of advanced 

9 green biofuels. 

10 (C) ADJUSTMENTS.— 

11 (i) DEFINITION OF ADJUSTMENT PE12 RIOD.—In this subparagraph, the term ‘‘ad13 justment period’’ means the period that— 

14 (I) begins on the date of establish15 ment of the Program; and 

16 (II) ends on the earlier of, as de17 termined by the Administrator— 

18 (aa) the date on which the 

19 Program supports projects that 

20 have the potential to produce, or 

21 are producing, not less than 

22 1,000,000,000 gallons in annual 

23 domestic production capacity of 

24 advanced green biofuels; and 


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1 (bb) the date on which the 

2 Program achieves the annual do3 mestic production capacity targets 

4 of the Program. 

5 (ii) SOLICITATION OF APPLICATIONS.— 

6 For any calendar year during the adjust7 ment period for which an application for a 

8 grant under the Program is withdrawn, or 

9 for which a recipient of a grant under the 

10 Program fails to meet the domestic produc11 tion capacity targets of the recipient (as de12 termined by the Administrator), the Admin13 istrator shall solicit additional applications 

14 for grants under the Program. 

15 (D) APPLICATION POLICY.—The grant solic16 itation process of the Program shall provide for, 

17 as determined by the Administrator— 

18 (i) simplified, standardized, and time19 ly solicitation of applications; and 

20 (ii) a simplified, standardized funding 

21 process that requires— 

22 (I) timely receipt and review of 

23 applications; and 

24 (II) protection of proprietary in25 formation provided in applications. 


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1 (3) TYPES OF GRANTS.—In carrying out the 

2 Program, the Administrator shall provide 4 types of 

3 grants, as follows: 

4 (A) RESEARCH AND DEVELOPMENT

5 GRANTS.— 

6 (i) IN GENERAL.—A research and de7 velopment grant may be provided under the 

8 Program to a project that, as determined by 

9 the Administrator, will assist biofuel devel10 opers in producing advanced green biofuels 

11 by facilitating— 

12 (I) the development of technologies 

13 to produce advanced green biofuels; 

14 (II) the creation of technologies 

15 used in facilities that produce ad16 vanced green biofuels; or 

17 (III) the production of advanced 

18 green biofuels, including renewable bio19 mass. 

20 (ii) LIMITATION.—The amount of a re21 search and development grant provided 

22 under the Program shall not exceed the less23 er of— 

24 (I) an amount equal to 80 percent 

25 of the cost of the project; or 


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1 (II) $2,000,000. 

2 (B) PLANNING GRANTS.— 

3 (i) IN GENERAL.—A planning grant 

4 may be provided under the Program to a 

5 project that, as determined by the Adminis6 trator, will assist biofuel developers in pro7 ducing advanced green biofuels by facili8 tating the development and finalization of 

9 project plans and contracts that dem10 onstrate that— 

11 (I) the project has the potential 

12 for commercial viability; and 

13 (II) the project is likely to be 

14 operational by not later than 3 years 

15 after the date on which the planning 

16 grant is provided. 

17 (ii) LIMITATION.—The amount of a 

18 planning grant provided under the Pro19 gram shall not exceed the lesser of— 

20 (I) an amount equal to 80 percent 

21 of the cost of the project; or 

22 (II) $2,000,000. 

23 (C) TRANSLATIONAL GRANTS.— 

24 (i) IN GENERAL.—A translational 

25 grant, which helps to create successful techVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01014 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 nological innovations and the commercial 

2 use of those innovations, may be provided 

3 under the Program to a project that, as de4 termined by the Administrator will assist 

5 biofuel developers in producing advanced 

6 green biofuels, including from the develop7 ment of a basic proof-of-concept for the 

8 project to the establishment of a pilot-scale 

9 advanced green biofuel production facility 

10 through a phased process, as described in 

11 clause (ii). 

12 (ii) PHASES.—The phases referred to 

13 in clause (i) are the following: 

14 (I) PHASE I.—A project shall be 

15 considered to be in phase I for pur16 poses of this subparagraph if the pur17 pose of the project is to determine the 

18 scientific and technical merit and fea19 sibility of ideas that appear to have 

20 commercial potential, as described in 

21 subclause (II). 

22 (II) PHASE II.—A project shall be 

23 considered to be in phase II for pur24 poses of this subparagraph if the pur25 pose of the project is to advance the deVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01015 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 velopment of a project that meets par2 ticular Program needs, based on the 

3 scientific and technical merit and fea4 sibility demonstrated in the applica5 tion for the project (as evidenced by 

6 phase I of the project), taking into con7 sideration, among other things, the 

8 commercial potential of the project, as 

9 evidenced by— 

10 (aa) the record of success of 

11 the applicable biofuel developer in 

12 commercializing the results of re13 search; 

14 (bb) the existence of phase II15 appropriate funding commitments 

16 from the private sector or a fund17 ing source other than the Pro18 gram; 

19 (cc) the existence of commit20 ments for phase III of the project; 

21 and 

22 (dd) the presence of other in23 dicators of the commercial poten24 tial of the project. 


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1 (III) PHASE III.—A project shall 

2 be considered to be in phase III for 

3 purposes of this clause if— 

4 (aa) the project has com5 pleted phases I and II; and 

6 (bb) commercial application 

7 of, or the continuation of work on, 

8 the project will be funded by the 

9 private sector or a funding source 

10 other than the Program. 

11 (iii) LIMITATION.—The amount of a 

12 translational grant provided under the Pro13 gram shall not exceed the lesser of— 

14 (I) an amount equal to 80 percent 

15 of the cost of the project; or 

16 (II) $8,000,000. 

17 (D) CONSTRUCTION GRANTS.— 

18 (i) IN GENERAL.—A construction grant 

19 may be provided under the Program to a 

20 project that, as determined by the Adminis21 trator— 

22 (I) will assist biofuel developers in 

23 producing advanced green biofuels by 

24 paying construction costs and other 

25 costs; 


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1 (II) demonstrates the potential for 

2 commercial success; and 

3 (III) will commence construction 

4 by not later than 1 year after the date 

5 on which the construction grant is pro6 vided. 

7 (ii) LIMITATION.—The amount of a 

8 construction grant provided under the Pro9 gram shall not exceed an amount equal to 

10 60 percent of the cost of the project. 

11 (4) SELECTION.— 

12 (A) RESEARCH AND DEVELOPMENT

13 GRANTS.—In evaluating applications for re14 search and development grants under the Pro15 gram, the Administrator shall take into consider16 ation— 

17 (i) the potential of a project for com18 mercial viability; 

19 (ii) the potential of the project to pro20 vide environmental and public health bene21 fits; 

22 (iii) the potential of the project to use 

23 existing fuel delivery and distribution sys24 tems; and 


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1 (iv) such other factors as the Adminis2 trator determines to be appropriate. 

3 (B) PLANNING GRANTS.—In evaluating ap4 plications for planning grants under the Pro5 gram, the Administrator shall take into consider6 ation— 

7 (i) the potential of a project for com8 mercial viability; 

9 (ii) the potential of the project to pro10 vide environmental and public health bene11 fits; 

12 (iii) the potential of the project to use 

13 existing fuel delivery and distribution sys14 tems; 

15 (iv) the scalability of the project; and 

16 (v) such other factors as the Adminis17 trator determines to be appropriate. 

18 (C) TRANSLATIONAL GRANTS.—In evalu19 ating applications for translational grants under 

20 the Program, the Administrator shall take into 

21 consideration— 

22 (i) the potential of a project for com23 mercial viability; 


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1 (ii) the potential of the project to pro2 vide environmental and public health bene3 fits; 

4 (iii) the potential of the project to use 

5 existing fuel delivery and distribution sys6 tems; 

7 (iv) the scalability of the project; and 

8 (v) such other factors as the Adminis9 trator determines to be appropriate. 

10 (D) CONSTRUCTION GRANTS.—In evalu11 ating applications for construction grants under 

12 the Program, the Administrator shall take into 

13 consideration— 

14 (i) the potential of a project for com15 mercial success; 

16 (ii) the potential of the project to pro17 vide environmental and public health bene18 fits; 

19 (iii) the potential of the project to use 

20 existing fuel delivery and distribution sys21 tems; 

22 (iv) the scalability of the project; 

23 (v) the readiness of the project to com24 mence construction by not later than 1 year 


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1 after the date on which the construction 

2 grant is provided; and 

3 (vi) such other factors as the Adminis4 trator determines to be appropriate. 

5 (E) EXERCISE OF DISCRETION IN FUNDING

6 PROJECTS.—The Administrator shall not exclude 

7 an application from consideration under this 

8 paragraph solely on the basis that the project 

9 that is the subject of the application uses, or pro10 poses to use, any item described in section 

11 211(o)(1)(I) of the Clean Air Act (42 U.S.C. 

12 7545(o)(1)(I)). 

13 (5) COORDINATION WITH COMPLEMENTARY PRO14 GRAMS.— 

15 (A) DEFINITION OF COMPLEMENTARY PRO16 GRAM.—In this paragraph, the term ‘‘com17 plementary program’’ means a grant program 

18 under any other provision of law (including a 

19 regulation) under which a recipient of a grant 

20 under the Program receives, or has the potential 

21 to receive, funds to assist the project of the re22 cipient to achieve environmental performance 

23 standards equivalent to, or greater than, the 

24 standards required under the Program. 

25 (B) EFFECT OF PROGRAM.— 


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1 (i) IN GENERAL.—A grant provided to 

2 a recipient under the Program— 

3 (I) shall be provided in addition 

4 to any grant provided to the recipient 

5 under a complementary program; and 

6 (II) shall not be diminished as a 

7 result of receipt by the recipient of 

8 funds under any complementary pro9 gram. 

10 (ii) AMOUNT OF OTHER GRANTS.—Re11 ceipt of a grant under the Program shall 

12 not affect the amount the recipient is other13 wise eligible to receive under any com14 plementary program. 

15 (d) AUTHORIZATION OF APPROPRIATIONS.—There is 

16 authorized to be appropriated to carry out this section 

17 $500,000,000 for the period of fiscal years 2010 through 

18 2014. 

19 SEC. 163. ENERGY EFFICIENCY IN BUILDING CODES. 

20 (a) ENERGY EFFICIENCY TARGETS.— 

21 (1) RULEMAKING TO ESTABLISH TARGETS.—The 

22 Administrator, or such other agency head or heads as 

23 may be designated by the President, in consultation 

24 with the Director of the National Institute of Stand25 ards and Technology, shall promulgate regulations esVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01022 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 tablishing building code energy efficiency targets for 

2 the national average percentage improvement of 

3 buildings’ energy performance. Such regulations shall 

4 establish a national building code energy efficiency 

5 target for residential buildings and commercial build6 ings when built to a code meeting the target, begin7 ning not later than January 1, 2014 and applicable 

8 each calendar year through December 31, 2030. 

9 (b) NATIONAL ENERGY EFFICIENCY BUILDING

10 CODES.— 

11 (1) RULEMAKING TO ESTABLISH NATIONAL

12 CODES.—The Administrator, or such other agency 

13 head or heads as may be designated by the President, 

14 shall promulgate regulations establishing national en15 ergy efficiency building codes for residential and com16 mercial buildings. Such regulations shall be sufficient 

17 to meet the national building code energy efficiency 

18 targets established under subsection (a) in the most 

19 cost-effective manner, and may include provisions for 

20 State adoption of the national building code stand21 ards and certification of State programs 

22 (c) ANNUAL REPORTS.—The Administrator, or such 

23 other agency head or heads as may be designated by the 

24 President, shall annually submit to Congress, and publish 

25 in the Federal Register, a report on— 


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1 (1) the status of national energy efficiency build2 ing codes; 

3 (2) the status of energy efficiency building code 

4 adoption and compliance in the States; 

5 (3) the implementation of and compliance with 

6 regulations promulgated under this section; 

7 (4) the status of Federal and State enforcement 

8 of building codes; and 

9 (5) impacts of action under this section, and po10 tential impacts of further action, on lifetime energy 

11 use by buildings, including resulting energy and cost 

12 savings. 

13 SEC. 164. RETROFIT FOR ENERGY AND ENVIRONMENTAL 

14 PERFORMANCE. 

15 (a) DEFINITIONS.—In this section: 

16 (1) ASSISTED HOUSING.—The term ‘‘assisted 

17 housing’’ means those properties receiving project18 based assistance pursuant to section 202 of the Hous19 ing Act of 1959 (12 U.S.C. 1701q), section 811 of the 

20 Cranston-Gonzalez National Affordable Housing Act 

21 (42 U.S.C. 8013), section 8 of the United States 

22 Housing Act of 1937 (42 U.S.C. 1437f), or similar 

23 programs. 

24 (2) NONRESIDENTIAL BUILDING.—The term 

25 ‘‘nonresidential building’’ means a building with a 


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1 primary use or purpose other than residential hous2 ing, including any building used for commercial of3 fices, schools, academic and other public and private 

4 institutions, nonprofit organizations including faith5 based organizations, hospitals, hotels, and other non6 residential purposes. Such buildings shall include 

7 mixed-use properties used for both residential and 

8 nonresidential purposes in which more than half of 

9 building floor space is nonresidential. 

10 (3) OPERATIONS AND MAINTENANCE.—The term 

11 ‘‘operations and maintenance’’ means any service 

12 performed by staff within a building to upgrade and 

13 maintain the building in order to reduce the energy 

14 demand of the building while maintaining or improv15 ing building comfort, health, safety, and performance. 

16 (4) PERFORMANCE-BASED BUILDING RETROFIT

17 PROGRAM.—The term ‘‘performance-based building 

18 retrofit program’’ means a program that determines 

19 building energy efficiency success based on actual 

20 measured savings after a retrofit is complete, as evi21 denced by energy invoices or evaluation protocols. 

22 (5) PRESCRIPTIVE BUILDING RETROFIT PRO23 GRAM.—The term ‘‘prescriptive building retrofit pro24 gram’’ means a program that projects building ret25 rofit energy efficiency success based on the known efVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01025 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 fectiveness of measures prescribed to be included in a 

2 retrofit. 

3 (6) PUBLIC HOUSING.—The term ‘‘public hous4 ing’’ means properties receiving assistance under sec5 tion 9 of the United States Housing Act of 1937 (42 

6 U.S.C. 1437g). 

7 (7) RECOMMISSIONING; RETROCOMMISSIONING.— 

8 The terms ‘‘recommissioning’’ and 

9 ‘‘retrocommissioning’’ have the meaning given those 

10 terms in section 543(f)(1) of the National Energy 

11 Conservation Policy Act (42 U.S.C. 8253(f)(1)). 

12 (8) REEP PROGRAM.—The term ‘‘REEP pro13 gram’’ means, collectively, the programs to implement 

14 the residential and nonresidential policies based on 

15 the standards developed under this section, as de16 scribed in subsection (b). 

17 (9) RESIDENTIAL BUILDING.—The term ‘‘resi18 dential building’’ means a building whose primary 

19 use is residential. Such buildings shall include single20 family homes (both attached and detached), owner-oc21 cupied units in larger buildings with their own dedi22 cated space-conditioning systems, apartment build23 ings, multi-unit condominium buildings, public hous24 ing, assisted housing, and buildings used for both resVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01026 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 idential and nonresidential purposes in which more 

2 than half of building floor space is residential. 

3 (10) STATE ENERGY PROGRAM.—The term 

4 ‘‘State Energy Program’’ means the program under 

5 part D of title III of the Energy Policy and Con6 servation Act (42 U.S.C. 6321 et seq.). 

7 (b) ESTABLISHMENT.—The Administrator shall de8 velop and implement, in consultation with the Secretary 

9 of Energy, standards for a national energy and environ10 mental building retrofit policy for single-family and multi11 family residences. The Administrator shall develop and im12 plement, in consultation with the Secretary of Energy and 

13 the Director of Commercial High-Performance Green Build14 ings, standards for a national energy and environmental 

15 building retrofit policy for nonresidential buildings. 

16 (c) PURPOSE.—The purpose of the REEP program is 

17 to facilitate the retrofitting of existing buildings across the 

18 United States to achieve maximum cost-effective energy effi19 ciency improvements and significant improvements in 

20 water use and other environmental attributes. 

21 (d) FEDERAL ADMINISTRATION.— 

22 (1) EXISTING PROGRAMS.—In creating and oper23 ating the REEP program— 

24 (A) the Administrator shall make appro25 priate use of existing programs, including the 


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1 Energy Star program and in particular the En2 vironmental Protection Agency Energy Star for 

3 Buildings program; and 

4 (B) the Administrator shall consult with the 

5 Secretary of Energy regarding appropriate use 

6 of existing programs, including delegating au7 thority to the Director of Commercial High-Per8 formance Green Buildings appointed under sec9 tion 421 of the Energy Independence and Secu10 rity Act of 2007 (42 U.S.C. 17081). 

11 (2) CONSULTATION AND COORDINATION.—The 

12 Administrator shall consult with and coordinate with 

13 the and the Secretary of Energy and the Secretary of 

14 Housing and Urban Development in carrying out the 

15 REEP program with regard to retrofitting of public 

16 housing and assisted housing. As a result of such con17 sultation, the Administrator shall establish standards 

18 to ensure that retrofits of public housing and assisted 

19 housing funded pursuant to this section are cost-effec20 tive, including opportunities to address the potential 

21 co-performance of repair and replacement needs that 

22 may be supported with other forms of Federal assist23 ance. Owners of public housing or assisted housing re24 ceiving funding through the REEP program shall 

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1 sistent with the provisions of the authorizing legisla2 tion governing each program for an additional period 

3 commensurate with the funding received, as deter4 mined in accordance with guidelines established by 

5 the Secretary of Housing and Urban Development. 

6 (3) ASSISTANCE.—The Administrator shall pro7 vide consultation and assistance to State and local 

8 agencies for the establishment of revolving loan funds, 

9 loan guarantees, or other forms of financial assistance 

10 under this section. 

11 (e) STATE AND LOCAL ADMINISTRATION.— 

12 (1) DESIGNATION AND DELEGATION.—A State 

13 may designate one or more agencies or entities, in14 cluding those regulated by the State, to carry out the 

15 purposes of this section, but shall designate one entity 

16 or individual as the principal point of contact for the 

17 Administrator regarding the REEP Program. The 

18 designated State agency, agencies, or entities may del19 egate performance of appropriate elements of the 

20 REEP program, upon their request and subject to 

21 State law, to counties, municipalities, appropriate 

22 public agencies, and other divisions of local govern23 ment, as well as to entities regulated by the State. In 

24 making any such designation or delegation, a State 

25 shall give priority to entities that administer existing 


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1 comprehensive retrofit programs, including those 

2 under the supervision of State utility regulators. 

3 States shall maintain responsibility for meeting the 

4 standards and requirements of the REEP program. 

5 In any State that elects not to administer the REEP 

6 program, a unit of local government may propose to 

7 do so within its jurisdiction, and if the Administrator 

8 finds that such local government is capable of admin9 istering the program, the Administrator may provide 

10 assistance to that local government, prorated accord11 ing to the population of the local jurisdiction relative 

12 to the population of the State, for purposes of the 

13 REEP program. 

14 (2) EMPLOYMENT.—States and local government 

15 entities may administer a REEP program in a man16 ner that authorizes public or regulated investor-owned 

17 utilities, building auditors and inspectors, contrac18 tors, nonprofit organizations, for-profit companies, 

19 and other entities to perform audits and retrofit serv20 ices under this section. A State may provide incen21 tives for retrofits without direct participation by the 

22 State or its agents, so long as the resulting savings 

23 are measured and verified. A State or local adminis24 trator of a REEP program shall seek to ensure that 

25 sufficient qualified entities are available to support 


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1 retrofit activities so that building owners have a com2 petitive choice among qualified auditors, raters, con3 tractors, and providers of services related to retrofits. 

4 Nothing in this section is intended to deny the right 

5 of a building owner to choose the specific providers of 

6 retrofit services to engage for a retrofit project in that 

7 owner’s building. 

8 (3) EQUAL INCENTIVES FOR EQUAL IMPROVE9 MENT.—In general, the States should strive to offer 

10 the same levels of incentives for retrofits that meet the 

11 same efficiency improvement goals, regardless of 

12 whether the State, its agency or entity, or the build13 ing owner has conducted the retrofit achieving the im14 provement, provided the improvement is measured 

15 and verified. 

16 (f) ADMINISTRATION OF INDIAN HOUSING.— 

17 (1) IN GENERAL.—Not later than 180 days after 

18 the date of enactment of this Act, the Secretary of En19 ergy, in consultation with Indian tribes, the Depart20 ment of Housing and Urban Development, the De21 partment of the Interior, and the Department of 

22 Health and Human Services, shall establish a pro23 gram and promulgate such regulations as are nec24 essary to assist Indian tribes in carrying out energy 


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1 efficiency retrofit programs in accordance with this 

2 section. 

3 (2) REVIEW OF EXISTING PROGRAMS.—In car4 rying out paragraph (1), to determine the extent to 

5 which programs in effect as of the date of enactment 

6 of this Act may be used to further the REEP program 

7 for the benefit of Indian tribes, the Secretary of En8 ergy shall review those programs, including— 

9 (A) the Weatherization Assistance Program 

10 for Low-Income Persons established under part A 

11 of title IV of the Energy Conservation and Pro12 duction Act (42 U.S.C. 6861 et seq.); 

13 (B) programs under the Native American 

14 Housing Assistance and Self-Determination Act 

15 of 1996 (25 U.S.C. 4101 et seq.); 

16 (C) the Housing Improvement Program of 

17 the Department of the Interior; and 

18 (D) the low-income home energy assistance 

19 program established under the Low-Income 

20 Home Energy Assistance Act of 1981 (42 U.S.C. 

21 8621 et seq.). 

22 (g) ELEMENTS OF REEP PROGRAM.—The Adminis23 trator, in consultation with the Secretary of Energy, shall 

24 establish goals, guidelines, practices, and standards for ac25 complishing the purpose stated in subsection (c), and shall 


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1 annually review and, as appropriate, revise such goals, 

2 guidelines, practices, and standards. The program under 

3 this section shall include the following: 

4 (1) Residential Energy Services Network 

5 (RESNET) or Building Performance Institute (BPI) 

6 analyst certification of residential building energy 

7 and environment auditors, inspectors, and raters, or 

8 an equivalent certification system as determined by 

9 the Administrator. 

10 (2) BPI certification or licensing by States of 

11 residential building energy and environmental retrofit 

12 contractors, or an equivalent certification or licensing 

13 system as determined by the Administrator. 

14 (3) BPI or Building Operator Certification or li15 censing of residential and nonresidential building op16 erators, superintendents, and handypersons, or an 

17 equivalent certification or licensing system, as deter18 mined by the Administrator. 

19 (4) Provision of BPI, RESNET, or other appro20 priate information on equipment and procedures, as 

21 determined by the Administrator, that contractors can 

22 use to test the energy and environmental efficiency of 

23 buildings effectively (such as infrared photography 

24 and pressurized testing, and tests for water use and 

25 indoor air quality). 


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1 (5) Provision of clear and effective materials to 

2 describe the testing and retrofit processes for typical 

3 buildings. 

4 (6) Guidelines for offering and managing pre5 scriptive building retrofit programs and performance6 based building retrofit programs for residential and 

7 nonresidential buildings. 

8 (7) Guidelines for applying recommissioning, 

9 retrocommissioning, and operations and maintenance 

10 principles to continuously improve the energy per11 formance of a building. 

12 (8) A requirement that building retrofits con13 ducted pursuant to a REEP program utilize, espe14 cially in all air-conditioned buildings, roofing mate15 rials with high solar energy reflectance, unless inap16 propriate due to green roof management, solar energy 

17 production, or for other reasons identified by the Ad18 ministrator, in order to reduce energy consumption 

19 within the building, increase the albedo of the build20 ing’s roof, and decrease the heat island effect in the 

21 area of the building, without reduction of otherwise 

22 applicable ceiling insulation standards. 

23 (9) Determination of energy savings in a per24 formance-based building retrofit program through— 


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1 (A) for residential buildings, comparison of 

2 before and after retrofit scores on the Home En3 ergy Rating System (HERS) Index, where the 

4 final score is produced by an objective third 

5 party; 

6 (B) for nonresidential buildings, Environ7 mental Protection Agency Portfolio Manager 

8 benchmarks; or 

9 (C) for either residential or nonresidential 

10 buildings, use of an Administrator-approved 

11 simulation program by a contractor with the ap12 propriate certification, subject to appropriate 

13 software standards and verification of at least 15 

14 percent of all work done, or such other percent15 age as the Administrator may determine. 

16 (10) Guidelines for utilizing the Energy Star 

17 Portfolio Manager, the Home Energy Rating System 

18 (HERS) rating system, Home Performance with En19 ergy Star program approvals, and any other tools as20 sociated with the retrofit program. 

21 (11) Requirements and guidelines for post-ret22 rofit inspection and confirmation of work and energy 

23 savings. 

24 (12) Detailed descriptions of funding options for 

25 the benefit of State and local governments, along with 


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1 model forms, accounting aids, agreements, and guides 

2 to best practices. 

3 (13) Guidance on opportunities for— 

4 (A) rating or certifying retrofitted buildings 

5 as Energy Star buildings, or as green buildings 

6 under a recognized green building rating system; 

7 (B) assigning Home Energy Rating System 

8 (HERS) or similar ratings; and 

9 (C) completing any applicable building per10 formance labels. 

11 (14) Sample materials for publicizing the pro12 gram to building owners, including public service an13 nouncements and advertisements. 

14 (15) Processes for tracking the numbers and loca15 tions of buildings retrofitted under the REEP pro16 gram, with information on projected and actual sav17 ings of energy and its value over time. 

18 (h) REQUIREMENTS.—As a condition of receiving as19 sistance for the REEP program pursuant to this Act, a 

20 State or qualifying local government shall— 

21 (1) adopt the standards for training, certifi22 cation of contractors, certification of buildings, and 

23 post-retrofit inspection as developed by the Adminis24 trator for residential and nonresidential buildings, re25 spectively, except as necessary to match local condiVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01036 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 tions, needs, efficiency opportunities, or other local 

2 factors, or to accord with State laws or regulations, 

3 and then only after the Administrator approves such 

4 a variance; 

5 (2) establish fiscal controls and accounting pro6 cedures (which conform to generally accepted govern7 ment accounting principles) sufficient to ensure prop8 er accounting during appropriate accounting periods 

9 for payments received and disbursements, and for 

10 fund balances; and 

11 (3) agree to make 10 percent of assistance re12 ceived to carry out this section available on a pref13 erential basis for retrofit projects proposed for public 

14 housing and assisted housing, provided that— 

15 (A) none of such funds shall be used for 

16 demolition of such housing; 

17 (B) such retrofits not shall not be used to 

18 justify any increase in rents charged to residents 

19 of such housing; and 

20 (C) owners of such housing shall agree to 

21 continue to provide affordable housing consistent 

22 with the provisions of the authorizing legislation 

23 governing each program for an additional period 

24 commensurate with the funding received; and 


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1 (4) the Administrator shall conduct or require 

2 each State to have such independent financial audits 

3 of REEP-related funding as the Administrator con4 siders necessary or appropriate to carry out the pur5 poses of this section. 

6 (i) OPTIONS TO SUPPORT REEP PROGRAM.—The as7 sistance provided under this section shall support the imple8 mentation through State REEP programs of alternate 

9 means of creating incentives for, or reducing financial bar10 riers to, improved energy and environmental performance 

11 in buildings, consistent with this section, including— 

12 (1) implementing prescriptive building retrofit 

13 programs and performance-based building retrofit 

14 programs; 

15 (2) providing credit enhancement, interest rate 

16 subsidies, loan guarantees, or other credit support; 

17 (3) providing initial capital for public revolving 

18 fund financing of retrofits; 

19 (4) providing funds to support utility-operated 

20 retrofit programs with repayments over time through 

21 utility rates, calibrated to create net positive cash 

22 flow to the building owner, and transferable from one 

23 building owner to the next with the building’s utility 

24 services; 


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1 (5) providing funds to local government pro2 grams to provide REEP services and financial assist3 ance; and 

4 (6) other means proposed by State and local 

5 agencies, subject to the approval of the Administrator. 

6 (j) SUPPORT FOR PROGRAM.— 

7 (1) INITIAL AWARD LIMITS.—Except as provided 

8 in paragraph (2), State and local REEP programs 

9 may make per-building direct expenditures for ret10 rofit improvements, or their equivalent in indirect or 

11 other forms of financial support, from funds made 

12 available to carry out this section, in amounts not to 

13 exceed the following amounts per unit: 

14 (A) RESIDENTIAL BUILDING PROGRAM.— 

15 (i) AWARDS.—For residential build16 ings— 

17 (I) support for a free or low-cost 

18 detailed building energy audit that 

19 prescribes measures sufficient to 

20 achieve at least a 20 percent reduction 

21 in energy use, by providing an incen22 tive equal to the documented cost of 

23 such audit, but not more than $200, in 

24 addition to any earned by achieving a 


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1 20 percent or greater efficiency im2 provement; 

3 (II) a total of $1,000 for a com4 bination of measures, prescribed in an 

5 audit conducted under subclause (I), 

6 designed to reduce energy consumption 

7 by more than 10 percent, and $2,000 

8 for a combination of measures pre9 scribed in such an audit, designed to 

10 reduce energy consumption by more 

11 than 20 percent; 

12 (III) $3,000 for demonstrated sav13 ings of 20 percent, pursuant to a per14 formance-based building retrofit pro15 gram; and 

16 (IV) $1,000 for each additional 5 

17 percentage points of energy savings 

18 achieved beyond savings for which 

19 funding is provided under subclause 

20 (II) or (III). 

21 Funding shall not be provided under clauses 

22 (II) and (III) for the same energy savings. 

23 (ii) MAXIMUM PERCENTAGE.—Awards 

24 under clause (i) shall not exceed 50 percent 

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1 ings with multiple residential units, awards 

2 under clause (i) shall not be greater than 50 

3 percent of the total cost of retrofitting the 

4 building, prorated among individual resi5 dential units on the basis of relative costs of 

6 the retrofit. In the case of public housing 

7 and assisted housing, the 50 percent con8 tribution matching the contribution from 

9 REEP program funds may come from any 

10 other source, including other Federal funds. 

11 (iii) ADDITIONAL AWARDS.—Addi12 tional awards may be provided for purposes 

13 of increasing energy efficiency, for buildings 

14 achieving at least 20 percent energy savings 

15 using funding provided under clause (i), in 

16 the form of grants of not more than $600 

17 for measures projected or measured (using 

18 an appropriate method approved by the Ad19 ministrator) to achieve at least 35 percent 

20 potable water savings through equipment or 

21 systems with an estimated service life of not 

22 less than 7 years, and not more than an ad23 ditional $20 may be provided for each addi24 tional one percent of such savings, up to a 

25 maximum total grant of $1,200. 


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1 (B) NONRESIDENTIAL BUILDING PRO2 GRAM.— 

3 (i) AWARDS.—For nonresidential 

4 buildings— 

5 (I) support for a free or low-cost 

6 detailed building energy audit that 

7 prescribes, as part of a energy-reducing 

8 measures sufficient to achieve at least a 

9 20 percent reduction in energy use, by 

10 providing an incentive equal to the 

11 documented cost of such audit, but not 

12 more than $500, in addition to any 

13 award earned by achieving a 20 per14 cent or greater efficiency improvement; 

15 (II) $0.15 per square foot of ret16 rofit area for demonstrated energy use 

17 reductions from 20 percent to 30 per18 cent; 

19 (III) $0.75 per square foot for 

20 demonstrated energy use reductions 

21 from 30 percent to 40 percent; 

22 (IV) $1.60 per square foot for 

23 demonstrated energy use reductions 

24 from 40 percent to 50 percent; and 


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1 (V) $2.50 per square foot for dem2 onstrated energy use reductions exceed3 ing 50 percent. 

4 (ii) MAXIMUM PERCENTAGE.— 

5 Amounts provided under subclauses (II) 

6 through (V) of clause (i) combined shall not 

7 exceed 50 percent of the total retrofit cost of 

8 a building. In nonresidential buildings with 

9 multiple units, such awards shall be pro10 rated among individual units on the basis 

11 of relative costs of the retrofit. 

12 (iii) ADDITIONAL AWARDS.—Addi13 tional awards may be provided, for build14 ings achieving at least 20 percent energy 

15 savings using funding provided under 

16 clause (i), as follows: 

17 (I) WATER.—For purposes of in18 creasing energy efficiency, grants may 

19 be made for whole building potable 

20 water use reduction (using an appro21 priate method approved by the Admin22 istrator) for up to 50 percent of the 

23 total retrofit cost, including amounts 

24 up to— 


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1 (aa) $24.00 per thousand 

2 gallons per year of potable water 

3 savings of 40 percent or more; 

4 (bb) $27.00 per thousand gal5 lons per year of potable water sav6 ings of 50 percent or more; and 

7 (cc) $30.00 per thousand gal8 lons per year of potable water sav9 ings of 60 percent or more. 

10 (II) ENVIRONMENTAL IMPROVE11 MENTS.—Additional awards of up to 

12 $1,000 may be granted for the inclu13 sion of other environmental attributes 

14 that the Administrator, in consultation 

15 with the Secretary, identifies as con16 tributing to energy efficiency. Such at17 tributes may include, but are not lim18 ited to waste diversion and the use of 

19 environmentally preferable materials 

20 (including salvaged, renewable, or re21 cycled materials, and materials with 

22 no or low-VOC content). The Adminis23 trator may recommend that States de24 velop such standards as are necessary 

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1 tions that may affect the feasibility or 

2 availability of identified resources and 

3 attributes. 

4 (iv) INDOOR AIR QUALITY MINIMUM.— 

5 Nonresidential buildings receiving incen6 tives under this section must satisfy at a 

7 minimum the most recent version of 

8 ASHRAE Standard 62.1 for ventilation, or 

9 the equivalent as determined by the Admin10 istrator. A State may issue a waiver from 

11 this requirement to a building project on a 

12 showing that such compliance is infeasible 

13 due to the physical constraints of the build14 ing’s existing ventilation system, or such 

15 other limitations as may be specified by the 

16 Administrator. 

17 (C) DISASTER DAMAGED BUILDINGS.—Any 

18 source of funds, including Federal funds pro19 vided through the Robert T. Stafford Disaster 

20 Relief and Emergency Assistance Act, shall qual21 ify as the building owner’s 50 percent contribu22 tion, in order to match the contribution of 

23 REEP funds, so long as the REEP funds are 

24 only used to improve the energy efficiency of the 

25 buildings being reconstructed. In addition, the 


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1 appropriate Federal agencies providing assist2 ance to building owners through the Robert T. 

3 Stafford Disaster Relief and Emergency Assist4 ance Act shall make information available, fol5 lowing a disaster, to building owners rebuilding 

6 disaster damaged buildings with assistance from 

7 the Act, that REEP funds may be used for en8 ergy efficiency improvements. 

9 (D) HISTORIC BUILDINGS.—Notwith10 standing subparagraphs (A) and (B), a building 

11 in or eligible for the National Register of His12 toric Places shall be eligible for awards under 

13 this paragraph in amounts up to 120 percent of 

14 the amounts set forth in subparagraphs (A) and 

15 (B). 

16 (E) SUPPLEMENTAL SUPPORT.—State and 

17 local governments may supplement the per-build18 ing expenditures under this paragraph with 

19 funding from other sources. 

20 (2) ADJUSTMENT.—The Administrator may ad21 just the specific dollar amounts provided under para22 graph (1) in years subsequent to the second year after 

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

24 thereafter, as the Administrator determines necessary 

25 to achieve optimum cost-effectiveness and to maximize 


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1 incentives to achieve energy efficiency within the total 

2 building award amounts provided in that paragraph, 

3 and shall publish and hold constant such revised lim4 its for at least 2 years. 

5 (k) REPORT TO CONGRESS.—The Administrator shall 

6 conduct an annual assessment of the achievements of the 

7 REEP program in each State, shall prepare an annual re8 port of such achievements and any recommendations for 

9 program modifications, and shall provide such report to 

10 Congress at the end of each fiscal year during which fund11 ing or other resources were made available to the States for 

12 the REEP program. 

13 (l) OPERATIONS AND MAINTENANCE.—Notwith14 standing any other provision of this section, REEP funds 

15 may be used to provide training to building staff relating 

16 to energy-efficient operations and maintenance of residen17 tial and nonresidential buildings. 

18 SEC. 165. CERTIFIED STOVES PROGRAM. 

19 (a) DEFINITIONS.—In this section: 

20 (1) AGENCY.—The term ‘‘Agency’’ means the En21 vironmental Protection Agency. 

22 (2) CERTIFIED STOVE.— 

23 (A) IN GENERAL.—The term ‘‘certified 

24 stove’’ means a wood stove or pellet stove that 

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1 dential wood heaters under subpart AAA of part 

2 60 of subchapter C of chapter I of title 40, Code 

3 of Federal Regulations (or successor regulations), 

4 as certified by the Administrator. 

5 (B) INCLUSION.—The term ‘‘certified stove’’ 

6 includes a pellet stove or fireplace insert that 

7 uses pellets for fuel that are exempt from testing 

8 by the Administrator but meet the same stand9 ards of performance as wood stoves. 

10 (3) ELIGIBLE ENTITY.—The term ‘‘eligible enti11 ty’’ means— 

12 (A) a State, a local government, or a feder13 ally recognized Indian tribe; 

14 (B) an Alaskan Native village or regional 

15 or village corporation (as defined in, or estab16 lished under, the Alaskan Native Claims Settle17 ment Act (43 U.S.C. 1601 et seq.)); and 

18 (C) a nonprofit organization or institution 

19 that— 

20 (i) represents or provides pollution re21 duction or educational services relating to 

22 wood smoke minimization to persons, orga23 nizations, or communities; or 


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1 (ii) has, as the principal purpose of the 

2 organization or institution, the promotion 

3 of air quality or energy efficiency. 

4 (4) WOOD STOVE OR PELLET STOVE.—The term 

5 ‘‘wood stove or pellet stove’’ means a wood stove, pellet 

6 stove, or fireplace insert that uses wood or pellets for 

7 fuel. 

8 (b) ESTABLISHMENT.—The Administrator shall estab9 lish and carry out a program to assist in the replacement 

10 of wood stoves or pellet stoves that do not meet the standards 

11 of performance described in subsection (a)(2) by— 

12 (1) requiring that each wood stove or pellet stove 

13 sold in the United States on and after the date of en14 actment of this Act meet the standards of performance 

15 described in subsection (a)(2); 

16 (2) requiring that no wood stove or pellet stove 

17 replaced under the program is sold or returned to ac18 tive service, but that it is instead destroyed and recy19 cled, to the maximum extent practicable; 

20 (3) providing funds to an eligible entity to re21 place a wood stove or pellet stove that does not meet 

22 the standards of performance described in subsection 

23 (a)(2) with a certified stove, including funds to pay 

24 for— 


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1 (A) installation of a replacement certified 

2 stove; and 

3 (B) necessary replacement of or repairs to 

4 ventilation, flues, chimneys, or other applicable 

5 items necessary for safe installation of a replace6 ment certified stove; 

7 (4) in addition to any funds that may be appro8 priated for the program under this section, using ex9 isting Federal, State, and local programs and incen10 tives, to the maximum extent practicable; 

11 (5) prioritizing the replacement of wood stoves or 

12 pellet stoves manufactured before July 1, 1990; and 

13 (6) carrying out such other activities as the Ad14 ministrator determines appropriate to facilitate the 

15 replacement of wood stoves or pellet stoves that do not 

16 meet the standards of performance described in sub17 section (a)(2). 

18 (c) EPA AUTHORITY TO ACCEPT WOOD STOVE OR

19 PELLET STOVE REPLACEMENT SUPPLEMENTAL ENVIRON20 MENTAL PROJECTS.— 

21 (1) IN GENERAL.—Notwithstanding sections 

22 1301 and 3302 of title 31, United States Code, the 

23 Administrator may accept a wood stove or pellet stove 

24 replacement supplemental environmental project as 


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1 part of a settlement of any alleged violation of envi2 ronmental law if the project— 

3 (A) protects human health or the environ4 ment; 

5 (B) is related to the underlying alleged vio6 lation; 

7 (C) does not constitute activities that the de8 fendant would otherwise be legally required to 

9 perform; and 

10 (D) does not provide funds for the staff of 

11 the Agency or for contractors to carry out the in12 ternal operations of the Agency. 

13 (2) CERTIFICATION.— 

14 (A) IN GENERAL.—In any settlement agree15 ment regarding an alleged violation of environ16 mental law under which a defendant agrees to 

17 perform a wood stove or pellet stove replacement 

18 supplemental environmental project, the Admin19 istrator shall require the defendant to include in 

20 the settlement documents a certification under 

21 penalty of law that the defendant would have 

22 agreed to perform a comparably valued, alter23 native project other than a wood stove or pellet 

24 stove replacement supplemental environmental 

25 project if the Administrator were precluded by 


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1 law from accepting a wood stove or pellet stove 

2 replacement supplemental environmental project. 

3 (B) EFFECT OF OMISSION.—A failure by 

4 the Administrator to include the certification de5 scribed in subparagraph (A) in a settlement 

6 agreement shall not— 

7 (i) create a cause of action against the 

8 United States under the Clean Air Act (42 

9 U.S.C. 7401 et seq.) or any other law; or 

10 (ii) create a basis for overturning a 

11 settlement agreement entered into by the 

12 United States. 

13 (d) REGULATIONS.—The Administrator may promul14 gate such regulations as are necessary to carry out the pro15 gram established under subsection (b). 

16 (e) FUNDING.— 

17 (1) AUTHORIZATION OF APPROPRIATIONS.— 

18 There are authorized to be appropriated to carry out 

19 the program established under subsection (b) 

20 $20,000,000 for the period of fiscal years 2010 

21 through 2014. 

22 (2) DESIGNATED USE.—Of amounts appro23 priated pursuant to this subsection— 

24 (A) 25 percent shall be designated for use to 

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1 section (b) on land held in trust for the benefit 

2 of a federally recognized Indian tribe; 

3 (B) 3 percent shall be designated for use to 

4 carry out the program in Alaskan Native vil5 lages or regional or village corporations (as de6 fined in, or established under, the Alaskan Na7 tive Claims Settlement Act (43 U.S.C. 1601 et 

8 seq.)); and 

9 (C) 72 percent shall be designated for use to 

10 carry out the program nationwide. 

11 (3) REGULATORY PROGRAMS.— 

12 (A) IN GENERAL.—No grant or loan pro13 vided under subsection (b) shall be used to fund 

14 the costs of emission reductions that are man15 dated under Federal, State, or local law. 

16 (B) MANDATED MEASURES.—For purposes 

17 of subparagraph (A), voluntary or elective emis18 sion reduction measures shall not be considered 

19 mandated, regardless of whether the reductions 

20 are included in the implementation plan of a 

21 State. 

22 SEC. 166. RENEWABLE FUEL STANDARD. 

23 (a) DEFINITIONS.—Section 211(o)(1) of the Clean Air 

24 Act (42 U.S.C. 7545(o)(1)) is amended— 


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1 (1) in subparagraph (B)(ii)(VII), by striking 

2 ‘‘cellulosic’’ and inserting ‘‘advanced green’’; 

3 (2) by striking subparagraph (E); 

4 (3) by redesignating subparagraphs (C) and (D) 

5 as subparagraphs (D) and (E), respectively; and 

6 (4) by inserting after subparagraph (B) the fol7 lowing: 

8 ‘‘(C) ADVANCED GREEN BIOFUEL.—The 

9 term ‘advanced green biofuel’ means renewable 

10 fuel that— 

11 ‘‘(i) is derived from renewable biomass; 

12 and 

13 ‘‘(ii) has lifecycle greenhouse gas emis14 sions that are at least 60 percent less than 

15 the baseline lifecycle greenhouse gas emis16 sions.’’. 

17 (b) STANDARD.—Section 211(o) of the Clean Air Act 

18 (42 U.S.C. 7545(o)) is amended— 

19 (1) in paragraph (2)— 

20 (A) in subparagraph (A)(i), by striking 

21 ‘‘cellulosic’’ and inserting ‘‘advanced green’’; and 

22 (B) in subparagraph (B)— 

23 (i) in clause (i)(III)— 


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1 (I) in the subclause heading, by 

2 striking ‘‘CELLULOSIC’’ and inserting 

3 ‘‘ADVANCED GREEN’’; 

4 (II) by striking ‘‘cellulosic’’ and 

5 inserting ‘‘advanced green’’; and 

6 (III) in the heading of the right 

7 column, by striking ‘‘cellulosic’’ and 

8 inserting ‘‘advanced green’’; 

9 (ii) in clause (ii)(III), by striking ‘‘cel10 lulosic’’ and inserting ‘‘advanced green’’; 

11 and 

12 (iii) in clause (iv)— 

13 (I) in the clause heading, by strik14 ing ‘‘CELLULOSIC’’ and inserting ‘‘AD15 VANCED GREEN’’; and 

16 (II) by striking ‘‘cellulosic’’ and 

17 inserting ‘‘advanced green’’; 

18 (2) in paragraphs (3)(A), (4)(A), and (4)(B), by 

19 striking ‘‘cellulosic’’ each place it appears and insert20 ing ‘‘advanced green’’; and 

21 (3) in paragraph (7)(D)— 

22 (A) in the subparagraph heading, by strik23 ing ‘‘CELLULOSIC’’ and inserting ‘‘ADVANCED

24 GREEN’’; and 


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1 (B) by striking ‘‘cellulosic’’ each place it 

2 appears and inserting ‘‘advanced green’’. 

3 SEC. 167. TREE PLANTING PROGRAMS. 

4 (a) FINDINGS.—Congress finds that— 

5 (1) the utility sector is the largest single source 

6 of greenhouse gas emissions in the United States, producing approximately 1 7 ⁄3 of the emissions of the 

8 United States; 

9 (2) heating and cooling of homes accounts for 

10 nearly 60 percent of residential electricity usage in 

11 the United States; 

12 (3) shade trees planted in strategic locations can 

13 reduce residential cooling costs by as much as 30 per14 cent; 

15 (4) shade trees are associated with significant 

16 clean air benefits; 

17 (5) every group of 100 healthy large trees re18 moves approximately 300 pounds of air pollution (in19 cluding particulate matter and ozone) and approxi20 mately 15 tons of carbon dioxide from the air each 

21 year; 

22 (6) tree cover on private property and on newly 

23 developed land has declined since the 1970s, even 

24 while emissions from transportation and industry 

25 have been rising; and 


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1 (7) in more than 12 test cities across the United 

2 States, increasing urban tree cover has generated be3 tween $2 and $5 in savings for every dollar invested 

4 in such tree planting. 

5 (b) DEFINITIONS.—In this section: 

6 (1) RETAIL POWER PROVIDER.—The term ‘‘retail 

7 power provider’’ means any entity authorized under 

8 applicable Federal or State law to generate, dis9 tribute, or provide retail electricity, natural gas, or 

10 fuel oil service. 

11 (2) SMALL.—The term ‘‘small’’, with respect to 

12 an office, means a nonresidential building or struc13 ture that is— 

14 (A) zoned for business purposes; and 

15 (B) not more than 20,000 square feet in 

16 total area. 

17 (3) TREE PLANTING ORGANIZATION.—The term 

18 ‘‘tree planting organization’’ means any nonprofit 

19 group that exists, in whole or in part— 

20 (A) to expand urban and residential tree 

21 cover; 

22 (B) to distribute trees for planting; 

23 (C) to increase awareness of the environ24 mental and energy-related benefits of trees; 


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1 (D) to educate the public regarding proper 

2 tree planting, care, and maintenance strategies; 

3 or 

4 (E) to carry out any combination of the ac5 tivities described in subparagraphs (A) through 

6 (D). 

7 (4) TREE SITING GUIDELINES.—The term ‘‘tree 

8 siting guidelines’’ means a comprehensive list of 

9 science-based measurements outlining— 

10 (A) applicable species; 

11 (B) the minimum distance required between 

12 trees planted pursuant to this section; and 

13 (C) the minimum required distance to be 

14 maintained between those trees and— 

15 (i) building foundations; 

16 (ii) air conditioning units; 

17 (iii) driveways and walkways; 

18 (iv) property fences; 

19 (v) preexisting utility infrastructure; 

20 (vi) septic systems; 

21 (vii) swimming pools; and 

22 (viii) other infrastructure, as appro23 priate. 

24 (c) PURPOSE.—The purpose of this section is to estab25 lish a grant program to assist retail power providers in 


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1 establishing and operating tree planting programs in resi2 dential and small office settings— 

3 (1) to reduce the peak load demand for electricity 

4 from residences and small office buildings during the 

5 summer months through direct shading of buildings 

6 provided by strategically planted trees; 

7 (2) to reduce wintertime demand for energy from 

8 residences and small office buildings by— 

9 (A) blocking cold winds from reaching those 

10 structures; 

11 (B) lowering interior temperatures; and 

12 (C) driving heating demand; 

13 (3) to protect public health by removing harmful 

14 pollution from the air; 

15 (4) to use the natural photosynthetic and tran16 spiration process of trees to lower ambient tempera17 tures and absorb carbon dioxide, mitigating the effects 

18 of climate change; 

19 (5) to decrease the amounts of electric bills for 

20 residential and small office ratepayers by limiting 

21 electricity consumption without reducing benefits; 

22 (6) to relieve financial and demand pressure on 

23 retail power providers that stems from large peak 

24 load energy demand; 


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1 (7) to protect water quality and public health by 

2 reducing stormwater runoff and keeping harmful pol3 lutants from entering waterways; and 

4 (8) to ensure that trees are planted in locations 

5 that limit the amount of public funds required to 

6 maintain public and electric infrastructure. 

7 (d) ASSISTANCE PROGRAM.— 

8 (1) IN GENERAL.—The Administrator may pro9 vide financial, technical, and related assistance to eli10 gible retail power providers to assist in establishing 

11 new, or operating existing, tree planting programs for 

12 residences and small office buildings. 

13 (2) PUBLIC RECOGNITION INITIATIVE.—In car14 rying out this section, the Administrator shall estab15 lish a national public recognition initiative to en16 courage participation in tree planting programs by 

17 retail power providers. 

18 (3) ELIGIBILITY.—Only tree planting programs 

19 that use targeted, strategic tree siting guidelines to 

20 plant trees in relation to building location, sunlight, 

21 and prevailing wind direction shall be eligible to re22 ceive assistance under this section. 

23 (4) REQUIREMENTS.—To be eligible to receive 

24 assistance under this section, a tree planting program 

25 shall— 


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1 (A) provide free or discounted shade-pro2 viding or wind-reducing trees to residential and 

3 small office consumers interested in lowering en4 ergy costs; 

5 (B) optimize the electricity consumption re6 duction benefit of each tree by planting in stra7 tegic locations around a given residence or small 

8 office; 

9 (C)(i) provide a maximum quantity of 

10 shade during summer intervals, when residences 

11 and small offices are exposed to the most sun in12 tensity; or 

13 (ii) provide a maximum quantity of wind 

14 protection during fall and winter intervals, when 

15 residences and small offices are exposed to the 

16 most wind intensity; 

17 (D) use the best available science to create 

18 tree siting guidelines that establish where opti19 mum tree species are best planted in locations 

20 that achieve maximum reductions in consumer 

21 energy demand while causing the least disrup22 tion to public infrastructure, taking into consid23 eration overhead and underground facilities; and 

24 (E) be certified by the Administrator, in 

25 collaboration with the head of the Urban and 


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1 Community Forestry Program of the Forest 

2 Service, as designed to achieve the goals de3 scribed in subparagraphs (A) through (D). 

4 (5) NEW PROGRAM FUNDING SHARE.—Not less 

5 than 30 percent of the amounts made available to 

6 carry out this section shall be distributed to retail 

7 power providers that— 

8 (A) have not previously established or oper9 ated qualified tree planting programs; or 

10 (B) are operating qualified tree planting 

11 programs established not more than 3 years be12 fore the date of enactment of this Act. 

13 (e) AGREEMENTS BETWEEN ELECTRICITY PROVIDERS

14 AND TREE PLANTING ORGANIZATIONS.— 

15 (1) IN GENERAL.—In providing assistance under 

16 this section, the Administrator may award grants 

17 only to retail power providers that have entered into 

18 binding legal agreements with tree planting organiza19 tions. 

20 (2) CONDITIONS OF AGREEMENT.—An agreement 

21 under paragraph (1) shall establish the conditions 

22 under which the tree planting organization shall pro23 vide a tree planting program, including a require24 ment that the tree planting organization shall— 


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1 (A) participate in local technical advisory 

2 committees responsible for drafting general tree 

3 siting guidelines and choosing the most effective 

4 species of trees to plant in given locations; 

5 (B) coordinate volunteer recruitment to as6 sist with the physical act of planting trees in 

7 residential locations; 

8 (C) carry out public awareness campaigns 

9 to educate local residents regarding the benefits, 

10 cost savings, and availability of free shade trees; 

11 (D) establish education and information 

12 campaigns to encourage recipients to maintain 

13 shade trees over the long term; 

14 (E) serve as the point of contact for existing 

15 and potential residential participants who have 

16 questions or concerns regarding the tree planting 

17 program; 

18 (F) require tree recipients to sign agree19 ments committing to voluntary stewardship and 

20 care of provided trees; 

21 (G) monitor and report on the survival, 

22 growth, overall health, and estimated energy sav23 ings of provided trees throughout the initial es24 tablishment period of the tree planting program, 

25 which shall be not less than 5 years; and 


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1 (H) ensure that— 

2 (i) trees planted near existing power 

3 lines will not interfere with energized elec4 tricity distribution lines when mature; and 

5 (ii) no new trees will be planted under 

6 or adjacent to high-voltage electric trans7 mission lines without prior consultation 

8 with the applicable retail power provider 

9 receiving assistance under this section. 

10 (3) LACK OF NONPROFIT ORGANIZATION.—If no 

11 tree planting organization exists or operates within 

12 an area served by a retail power provider applying 

13 for assistance under this section, the requirements of 

14 this subsection shall apply to a binding legal agree15 ment entered into by the retail power providers and 

16 1 or more of— 

17 (A) a local municipal government with ju18 risdiction over the applicable urban or suburban 

19 forest; 

20 (B) the State forester for the State in which 

21 the tree planting program will operate; 

22 (C) the Urban and Community Forestry 

23 representative for the State in which the tree 

24 planting program will operate; or 


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1 (D) a landscaping services company that 

2 is— 

3 (i) identified in consultation with a 

4 national or State nonprofit tree planting 

5 organization; 

6 (ii) licensed to operate in the State in 

7 which the tree planting program will oper8 ate; and 

9 (iii) a business (as defined in 2007 

10 North American Industry Classification 

11 System Code 561730 of the United States 

12 Census Bureau). 

13 (f) TECHNICAL ADVISORY COMMITTEES.— 

14 (1) IN GENERAL.—To be eligible to receive assist15 ance under this section, a retail power provider shall 

16 establish and consult with a local technical advisory 

17 committee, which— 

18 (A) shall provide advice and consultation to 

19 the program; and 

20 (B) may— 

21 (i) design and adopt an approved 

22 plant list that emphasizes the use of hardy, 

23 noninvasive tree species and, where geo24 graphically appropriate, the use of native 


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1 (or site-adapted) or low water-use shade 

2 trees; 

3 (ii) design and adopt planting, instal4 lation, and maintenance specifications and 

5 establish a process for inspection and qual6 ity control; 

7 (iii) ensure that tree recipients are 

8 educated to care for and maintain trees over 

9 the long term; 

10 (iv) help the public become more en11 gaged and educated in the planting and 

12 care of shade trees; 

13 (v) prioritize the sites that will receive 

14 trees, giving preference to locations with the 

15 highest potential for energy conservation 

16 and secondary preference to areas in which 

17 the average annual income is below the re18 gional median; and 

19 (vi) assist with monitoring and collec20 tion of data on tree health, tree survival, 

21 and energy conservation benefits generated 

22 under this section. 

23 (2) COMPENSATION.—An individual serving on a 

24 local technical advisory committee under this sub25 section shall not receive compensation for that service. 


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1 (3) COMPOSITION.—Each local technical advi2 sory committee under this subsection shall be com3 posed of representatives of public, private, and non4 governmental agencies with expertise regarding de5 mand-side energy efficiency management, urban for6 estry, or arboriculture, including— 

7 (A) not more than 4, and not less than 1, 

8 individuals representing the retail power pro9 vider receiving assistance under this section; 

10 (B) not more than 4, and not less than 1, 

11 individuals representing the local tree planting 

12 organization that will partner with the retail 

13 power provider to carry out this section; 

14 (C)(i) not more than 3 individuals rep15 resenting local nonprofit conservation or envi16 ronmental organizations, with preference given 

17 to entities that— 

18 (I) are described in section 501(c)(3) of 

19 the Internal Revenue Code of 1986; and 

20 (II) have demonstrated expertise engag21 ing the public in energy conservation, en22 ergy efficiency, or green building practices 

23 (or a combination thereof); but 


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1 (ii) not more than 1 individual rep2 resenting each organization described in clause 

3 (i); 

4 (D) not more than 2 individuals rep5 resenting a local affordable housing agency, af6 fordable housing builder, or community develop7 ment corporation; 

8 (E) not more than 3, and not less than 1, 

9 individuals representing the local city or county 

10 government for each municipality in which a 

11 shade tree planting program will take place, at 

12 least 1 of whom shall be the city or county for13 ester, city or county arborist, or functional 

14 equivalent; 

15 (F) not more than 1 individual rep16 resenting the local government agency responsible 

17 for management of roads, sewers, and infrastruc18 ture, including public works departments, trans19 portation agencies, or equivalent entities; 

20 (G) not more than 3 individuals rep21 resenting the nursery and landscaping industry; 

22 and 

23 (H) not more than 3 individuals rep24 resenting the research community or academia, 


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1 with expertise regarding natural resources or en2 ergy management issues. 

3 (4) CHAIRPERSON.—Each local technical advi4 sory committee shall elect, from the members described 

5 in subparagraph (A) or (B) of paragraph (3), a 

6 chairperson, who shall— 

7 (A) preside over committee meetings; 

8 (B) act as a liaison to governmental and 

9 other entities; and 

10 (C) direct the general operation of the com11 mittee. 

12 (5) CREDENTIALS.—At least 1 member of each 

13 local technical advisory committee shall be certified 

14 with 1 or more of the following credentials: 

15 (A) International Society of Arboriculture. 

16 (B) Certified Arborist, ISA. 

17 (C) Certified Arborist Municipal Specialist, 

18 ISA. 

19 (D) Certified Arborist Utility Specialist, 

20 ISA. 

21 (E) Board Certified Master Arborist. 

22 (F) Registered Landscape Architect rec23 ommended by the American Society of Land24 scape Architects. 

25 (g) COST SHARING.— 


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1 (1) FEDERAL SHARE.—The Federal share of the 

2 cost of a project under this section shall be not more 

3 than 50 percent. 

4 (2) NON-FEDERAL SHARE.—The non-Federal 

5 share of the cost of a project under this section may 

6 be paid by any entity from any funds not derived di7 rectly or indirectly from an agency or instrumen8 tality of the United States. 

9 (h) RULEMAKING.— 

10 (1) RULEMAKING PERIOD.—The Administrator 

11 may solicit comments and initiate a rulemaking pe12 riod of not more than 2 years after the date of enact13 ment of this section. 

14 (2) COMPETITIVE GRANT RULE.—At the conclu15 sion of the rulemaking period under paragraph (1), 

16 the Administrator shall promulgate a rule governing 

17 a public, competitive grant process through which re18 tail power providers may apply for assistance under 

19 this section. 

20 (i) NONDUPLICITY.—Nothing in this section super21 sedes, duplicates, cancels, or negates any program or au22 thority under section 9 of the Cooperative Forestry Assist23 ance Act of 1978 (16 U.S.C. 2105). 


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1 (j) AUTHORIZATION OF APPROPRIATIONS.—There are 

2 authorized to be appropriated such sums as are necessary 

3 to carry out this section. 

4 Subtitle G—Emission Reductions 

5 From Public Transportation Ve6 hicles 

7 SEC. 171. SHORT TITLE. 

8 This subtitle may be cited as the ‘‘Green Taxis Act of 

9 2009’’. 

10 SEC. 172. STATE FUEL ECONOMY REGULATION FOR TAXI11 CABS. 

12 Section 32919 of title 49, United States Code, is 

13 amended by adding at the end the following new subsection: 

14 ‘‘(d) TAXICABS.—Notwithstanding subsection (a), a 

15 State or political subdivision of a State may prescribe re16 quirements for fuel economy for taxicabs and other auto17 mobiles if such requirements are at least as stringent as 

18 applicable Federal requirements and if such taxicabs and 

19 other automobiles— 

20 ‘‘(1) are automobiles that are capable of trans21 porting not more than 10 individuals, including the 

22 driver; 

23 ‘‘(2) are commercially available or are designed 

24 and manufactured pursuant to a contract with such 

25 State or political subdivision of such State; 


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1 ‘‘(3) are operated for hire pursuant to an oper2 ating or regulatory license, permit, or other author3 ization issued by such State or political subdivision 

4 of such State; 

5 ‘‘(4) provide local transportation for a fare de6 termined on the basis of the time or distance traveled 

7 or a combination of time and distance traveled; and 

8 ‘‘(5) do not exclusively provide transportation to 

9 and from airports.’’. 

10 SEC. 173. STATE REGULATION OF MOTOR VEHICLE EMIS11 SIONS FOR TAXICABS. 

12 Section 209 of the Clean Air Act (42 U.S.C. 7543) is 

13 amended by adding at the end the following new subsection: 

14 ‘‘(f) TAXICABS.—(1) Notwithstanding subsection (a), a 

15 State or political subdivision thereof may adopt and enforce 

16 standards for the control of emissions from new motor vehi17 cles that are taxicabs and other vehicles if such standards 

18 will be, in the aggregate, at least as protective of public 

19 health and welfare as applicable Federal standards and if 

20 such taxicabs and other vehicles— 

21 ‘‘(A) are passenger motor vehicles that are 

22 capable of transporting not more than 10 indi23 viduals, including the driver; 


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1 ‘‘(B) are commercially available or are de2 signed and manufactured pursuant to a contract 

3 with such State or political subdivision thereof; 

4 ‘‘(C) are operated for hire pursuant to an 

5 operating or regulatory license, permit, or other 

6 authorization issued by such State or political 

7 subdivision thereof; 

8 ‘‘(D) provide local transportation for a fare 

9 determined on the basis of the time or distance 

10 traveled or a combination of time and distance 

11 traveled; and 

12 ‘‘(E) do not exclusively provide transpor13 tation to and from airports. 

14 ‘‘(2) If each standard of a State or political subdivi15 sion thereof is at least as stringent as the comparable appli16 cable Federal standard, such standard of such State or po17 litical subdivision thereof shall be deemed at least as protec18 tive of health and welfare as such Federal standards for 

19 purposes of this subsection.’’. 

20 Subtitle H—Clean Energy and 

21 Natural Gas 

22 SEC. 181. CLEAN ENERGY AND ACCELERATED EMISSION RE23 DUCTION PROGRAM. 

24 (a) ESTABLISHMENT.— 


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1 (1) IN GENERAL.—The Administrator shall es2 tablish a program to promote dispatchable power gen3 eration projects that can accelerate the reduction of 

4 power sector carbon dioxide and other greenhouse gas 

5 emissions. 

6 (2) USE OF FUNDS.—Funds provided under this 

7 section shall be used by the Administrator to make in8 centive payments to owners or operators of eligible 

9 projects. 

10 (b) REGULATIONS.—Not later than 90 days after the 

11 date of enactment of this Act, the Administrator shall pro12 mulgate regulations providing for incentives, pursuant to 

13 the requirements of this section. 

14 (c) GOAL.—Not later than 3 years after the date of 

15 enactment of this Act, the Administrator shall provide in16 centives for eligible projects that generate 300,000 gigawatt17 hours of electricity per year. 

18 (d) CRITERIA FOR ELIGIBLE PROJECTS.—To be eligi19 ble for funding under this section a project must— 

20 (1) reduce emissions below the 2007 average 

21 greenhouse gas emissions per megawatt-hour of the 

22 United States electric power sector by the quantity 

23 specified in subsection (f); and 

24 (2) not receive an investment or production cred25 it in— 


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1 (A) the year in which the project is placed 

2 in service; or 

3 (B) calendar year 2009, notwithstanding 

4 the year in which the project was placed in serv5 ice. 

6 (e) PRIORITY.—The Administrator shall give priority 

7 to eligible projects from the following categories: 

8 (1) Power generation projects designed to inte9 grate intermittent renewable power into the bulk10 power system. 

11 (2) Energy storage projects used to support re12 newable energy. 

13 (3) Power generation projects with carbon cap14 ture and sequestration that are not eligible for other 

15 assistance under this Act. 

16 (4) Projects that achieve the greatest reduction in 

17 greenhouse gas emissions per dollar of incentive pay18 ment. 

19 (f) EMISSION REDUCTION CRITERIA.—For the pur20 poses of subsection (d), the applicable emission reduction 

21 quantity shall be determined in accordance with the fol22 lowing table: 

Calendar years 

Percentage below 2007 average greenhouse gas emissions per MWh of United 

States electric power sector 

2010 through 2020 ........................................................ 25 percent 

2021 through 2025 ........................................................ 40 percent 

2026 through 2030 ........................................................ 65 percent 


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1 (g) AUTHORIZATION OF APPROPRIATIONS.—There are 

2 authorized to be appropriated to the Administrator such 

3 sums as are necessary to carry out this section for each of 

4 fiscal years 2010 through 2030. 

5 SEC. 182. ADVANCED NATURAL GAS TECHNOLOGIES. 

6 (a) DEFINITIONS.—In this section: 

7 (1) CORPORATION.— 

8 (A) IN GENERAL.—The term ‘‘corporation’’ 

9 means any corporation, joint-stock company, 

10 partnership, limited liability company, associa11 tion, business trust, or other organized group of 

12 persons, regardless of incorporation. 

13 (B) EXCLUSION.—The term ‘‘corporation’’ 

14 does not include a municipality. 

15 (2) ELIGIBLE ENTITY.— 

16 (A) IN GENERAL.—The term ‘‘eligible enti17 ty’’ means an entity that is eligible to receive a 

18 grant under subsection (b). 

19 (B) INCLUSIONS.—The term ‘‘eligible enti20 ty’’ includes a corporation, an eligible research 

21 entity, an industry entity, a municipality, a 

22 municipal natural gas distribution system, and 

23 a natural gas distribution company. 

24 (3) ELIGIBLE RESEARCH ENTITY.— 


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1 (A) IN GENERAL.—The term ‘‘eligible re2 search entity’’ means an entity that is experi3 enced in planning, conducting, and imple4 menting natural gas research, development, dem5 onstration, and deployment projects. 

6 (B) INCLUSIONS.—The term ‘‘eligible re7 search entity’’ includes a research institution 

8 and an institution of higher education. 

9 (4) INDUSTRY ENTITY.— 

10 (A) IN GENERAL.—The term ‘‘industry enti11 ty’’ means the persons and municipalities collec12 tively engaged in the delivery of natural gas for 

13 consumption in the United States (such as nat14 ural gas distribution companies and municipal 

15 natural gas distribution systems). 

16 (B) EXCLUSION.—The term ‘‘industry enti17 ty’’ does not include any natural gas customer. 

18 (5) MUNICIPALITY.—The term ‘‘municipality’’ 

19 means a city, county, or other political subdivision or 

20 agency of a State. 

21 (6) MUNICIPAL NATURAL GAS DISTRIBUTION SYS22 TEM.—The term ‘‘municipal natural gas distribution 

23 system’’ means a municipality engaged in the busi24 ness of delivering natural gas for consumption to resiVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01077 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 dential, commercial, industrial, and other natural gas 

2 customers. 

3 (7) NATURAL GAS.— 

4 (A) IN GENERAL.—The term ‘‘natural gas’’ 

5 means a mixture of hydrocarbon and nonhydro6 carbon gases, primarily methane, that have been 

7 produced from geological formations or by any 

8 other means. 

9 (B) INCLUSION.—The term ‘‘natural gas’’ 

10 includes renewable biogas. 

11 (8) NATURAL GAS DISTRIBUTION COMPANY.—The 

12 term ‘‘natural gas distribution company’’ means a 

13 person engaged in the business of distributing natural 

14 gas for consumption to residential, commercial, in15 dustrial, or other natural gas customers. 

16 (b) GRANT PROGRAMS.— 

17 (1) NATURAL GAS ELECTRICITY GENERATION

18 GRANTS.—The Administrator, in consultation with 

19 Secretary of Energy, may provide to eligible entities 

20 research and development grants to support the de21 ployment of low greenhouse-gas-emitting end-use tech22 nologies, including carbon capture and sequestration 

23 technologies, for natural gas electricity generation. 

24 (2) NATURAL GAS RESIDENTIAL AND COMMER25 CIAL TECHNOLOGY GRANTS.—The Administrator shall 


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1 establish a program to provide to eligible entities 

2 grants to advance the commercial demonstration or 

3 early development of low greenhouse-gas-emitting end4 use technologies fueled by natural gas, including car5 bon capture and storage, for residential and commer6 cial purposes, through research, development, dem7 onstration, and deployment of those technologies. 

8 (c) REPORTING.—Not later than 180 days after the 

9 date of enactment of this Act, and every 180 days thereafter, 

10 the Secretary of Energy shall submit to the Committee on 

11 Energy and Commerce of the House of Representatives and 

12 the Senate Committees on Energy and Natural Resources 

13 and Environment and Public Works of the Senate a report 

14 that describes the status and results of activities carried out 

15 under subsection (b). 

16 (d) AUTHORIZATION.—There are authorized to be ap17 propriated such sums as are necessary to carry out this sec18 tion. 

19 TITLE II—RESEARCH 

20 Subtitle A—Energy Research 

21 SEC. 201. ADVANCED ENERGY RESEARCH. 

22 (a) IN GENERAL.—The Administrator shall establish 

23 a program to provide grants for advanced energy research. 

24 (b) DISTRIBUTION.—The Administrator shall dis25 tribute grants on a competitive basis to institutions of highVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01079 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 er education, companies, research foundations, trade and 

2 industry research collaborations, or consortia of such enti3 ties, or other appropriate research and development entities. 

4 (c) SELECTION OF PROPOSALS.—In selecting proposals 

5 for funding under this section, the Administrator shall 

6 prioritize applications that— 

7 (1) enhance the economic and energy security of 

8 the United States through the development of energy 

9 technologies that result in— 

10 (A) reductions of imports of energy from 

11 foreign sources; 

12 (B) reductions of energy-related emissions, 

13 including greenhouse gases; and 

14 (C) improvements in the energy efficiency of 

15 all economic sectors; and 

16 (2) ensure that the United States maintains a 

17 technological lead in developing and deploying ad18 vanced energy technologies. 

19 (d) RESPONSIBILITIES.—The Administrator shall be 

20 responsible for assessing the success of programs and termi21 nating programs carried out under this section that are not 

22 achieving the goals of the programs. 

23 (e) ASSISTANCE.—Assistance provided under this sec24 tion shall be used to supplement, and not to supplant, any 


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1 other Federal resources available to carry out activities de2 scribed in this section. 

3 (f) AUTHORIZATION.—There are authorized to be ap4 propriated such sums as are necessary to carry out this sec5 tion. 

6 Subtitle B—Drinking Water Adap7 tation, Technology, Education, 

8 and Research 

9 SEC. 211. EFFECTS OF CLIMATE CHANGE ON DRINKING 

10 WATER UTILITIES. 

11 (a) FINDINGS.—Congress finds that— 

12 (1) the consensus among climate scientists is 

13 overwhelming that climate change is occurring more 

14 rapidly than can be attributed to natural causes, and 

15 that significant impacts to the water supply are al16 ready occurring; 

17 (2) among the first and most critical of those im18 pacts will be change to patterns of precipitation 

19 around the world, which will affect water availability 

20 for the most basic drinking water and domestic water 

21 needs of populations in many areas of the United 

22 States; 

23 (3) drinking water utilities throughout the 

24 United States, as well as those in Europe, Australia, 


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1 and Asia, are concerned that extended changes in pre2 cipitation will lead to extended droughts; 

3 (4) supplying water is highly energy-intensive 

4 and will become more so as climate change forces 

5 more utilities to turn to alternative supplies; 

6 (5) energy production consumes a significant 

7 percentage of the fresh water resources of the United 

8 States; 

9 (6) since 2003, the drinking water industry of 

10 the United States has sponsored, through a nonprofit 

11 water research foundation, various studies to assess 

12 the impacts of climate change on drinking water sup13 plies; 

14 (7) those studies demonstrate the need for a com15 prehensive program of research into the full range of 

16 impacts on drinking water utilities, including im17 pacts on water supplies, facilities, and customers; 

18 (8) that nonprofit water research foundation is 

19 also coordinating internationally with other drinking 

20 water utilities on shared research projects and has 

21 hosted international workshops with counterpart Eu22 ropean and Asian water research organizations to de23 velop a unified research agenda for applied research 

24 on adaptive strategies to address climate change im25 pacts; 


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1 (9) research data in existence as of the date of 

2 enactment of this Act— 

3 (A) summarize the best available scientific 

4 evidence on climate change; 

5 (B) identify the implications of climate 

6 change for the water cycle and the availability 

7 and quality of water resources; and 

8 (C) provide general guidance on planning 

9 and adaptation strategies for water utilities; and 

10 (10) given uncertainties about specific climate 

11 changes in particular areas, drinking water utilities 

12 need to prepare for a wider range of likely possibili13 ties in managing and delivery of water. 

14 (b) IN GENERAL.—The Administrator, in cooperation 

15 with the Secretary of Commerce, the Secretary of Energy, 

16 and the Secretary of the Interior, shall establish and pro17 vide funding for a program of directed and applied re18 search, to be conducted through a nonprofit drinking water 

19 research foundation and sponsored by water utilities, to as20 sist the utilities in adapting to the effects of climate change. 

21 (c) RESEARCH AREAS.—The research conducted in ac22 cordance with subsection (b) shall include research into— 

23 (1) water quality impacts and solutions, includ24 ing research— 


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1 (A) to address probable impacts on raw 

2 water quality resulting from— 

3 (i) erosion and turbidity from extreme 

4 precipitation events; 

5 (ii) watershed vegetation changes; and 

6 (iii) increasing ranges of pathogens, 

7 algae, and nuisance organisms resulting 

8 from warmer temperatures; and 

9 (B) on mitigating increasing damage to 

10 watersheds and water quality by evaluating ex11 treme events, such as wildfires and hurricanes, to 

12 learn and develop management approaches to 

13 mitigate— 

14 (i) permanent watershed damage; 

15 (ii) quality and yield impacts on 

16 source waters; and 

17 (iii) increased costs of water treatment; 

18 (2) impacts on groundwater supplies from car19 bon sequestration, including research to evaluate po20 tential water quality consequences of carbon seques21 tration in various regional aquifers, soil conditions, 

22 and mineral deposits; 

23 (3) water quantity impacts and solutions, in24 cluding research— 


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1 (A) to evaluate climate change impacts on 

2 water resources throughout hydrological basins of 

3 the United States; 

4 (B) to improve the accuracy and resolution 

5 of climate change models at a regional level; 

6 (C) to identify and explore options for in7 creasing conjunctive use of aboveground and un8 derground storage of water; and 

9 (D) to optimize operation of existing and 

10 new reservoirs in diminished and erratic periods 

11 of precipitation and runoff; 

12 (4) infrastructure impacts and solutions for 

13 water treatment and wastewater treatment facilities 

14 and underground pipelines, including research— 

15 (A) to evaluate and mitigate the impacts of 

16 sea level rise on— 

17 (i) near-shore facilities; 

18 (ii) soil drying and subsidence; 

19 (iii) reduced flows in water and waste20 water pipelines; and 

21 (iv) extreme flows in wastewater sys22 tems; and 

23 (B) on ways of increasing the resilience of 

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1 oping new design standards for future infra2 structure that include the use of energy conserva3 tion measures and renewable energy in new con4 struction to the maximum extent practicable; 

5 (5) desalination, water reuse, and alternative 

6 supply technologies, including research— 

7 (A) to improve and optimize existing mem8 brane technologies, and to identify and develop 

9 breakthrough technologies, to enable the use of 

10 seawater, brackish groundwater, treated waste11 water, and other impaired sources; 

12 (B) into new sources of water through more 

13 cost-effective water treatment practices in recy14 cling and desalination; and 

15 (C) to improve technologies for use in— 

16 (i) managing and minimizing the vol17 ume of desalination and reuse concentrate 

18 streams; and 

19 (ii) minimizing the environmental im20 pacts of seawater intake at desalination fa21 cilities; 

22 (6) energy efficiency and greenhouse gas mini23 mization, including research— 

24 (A) on optimizing the energy efficiency of 

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1 proving water efficiency in energy production 

2 and management; and 

3 (B) to identify and develop renewable, car4 bon-neutral energy options for the water supply 

5 and wastewater industry; 

6 (7) regional and hydrological basin cooperative 

7 water management solutions, including research 

8 into— 

9 (A) institutional mechanisms for greater re10 gional cooperation and use of water exchanges, 

11 banking, and transfers; and 

12 (B) the economic benefits of sharing risks of 

13 shortage across wider areas; 

14 (8) utility management, decision support sys15 tems, and water management models, including re16 search— 

17 (A) into improved decision support systems 

18 and modeling tools for use by water utility man19 agers to assist with increased water supply un20 certainty and adaptation strategies posed by cli21 mate change; 

22 (B) to provide financial tools, including 

23 new rate structures, to manage financial re24 sources and investments, because increased conVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01087 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 servation practices may diminish revenue and 

2 increase investments in infrastructure; and 

3 (C) to develop improved systems and models 

4 for use in evaluating— 

5 (i) successful alternative methods for 

6 conservation and demand management; and 

7 (ii) climate change impacts on ground8 water resources; 

9 (9) reducing greenhouse gas emissions and im10 proving energy demand management, including re11 search to improve energy efficiency in water collec12 tion, production, transmission, treatment, distribu13 tion, and disposal to provide more sustainability and 

14 means to assist drinking water utilities in reducing 

15 the production of greenhouse gas emissions in the col16 lection, production, transmission, treatment, distribu17 tion, and disposal of drinking water; 

18 (10) water conservation and demand manage19 ment, including research— 

20 (A) to develop strategic approaches to water 

21 demand management that offer the lowest-cost, 

22 noninfrastructural options to serve growing pop23 ulations or manage declining supplies, primarily 

24 through— 


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1 (i) efficiencies in water use and re2 allocation of the saved water; 

3 (ii) demand management tools; 

4 (iii) economic incentives; and 

5 (iv) water-saving technologies; and 

6 (B) into efficiencies in water management 

7 through integrated water resource management 

8 that incorporates— 

9 (i) supply-side and demand-side proc10 esses; 

11 (ii) continuous adaptive management; 

12 and 

13 (iii) the inclusion of stakeholders in de14 cisionmaking processes; and 

15 (11) communications, education, and public ac16 ceptance, including research— 

17 (A) into improved strategies and ap18 proaches for communicating with customers, de19 cisionmakers, and other stakeholders about the 

20 implications of climate change on water supply 

21 and water management; 

22 (B) to develop effective communication ap23 proaches— 

24 (i) to gain public acceptance of alter25 native water supplies and new policies and 


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1 practices, including conservation and de2 mand management; and 

3 (ii) to gain public recognition and ac4 ceptance of increased costs; and 

5 (C) to create and maintain a clearinghouse 

6 of climate change information for water utilities, 

7 academic researchers, stakeholders, government 

8 agencies, and research organizations. 

9 (d) AUTHORIZATION OF APPROPRIATIONS.—There is 

10 authorized to be appropriated to carry out this section 

11 $25,000,000 for each of fiscal years 2010 through 2020. 

12 TITLE III—TRANSITION AND 

13 ADAPTATION 

14 Subtitle A—Green Jobs and Worker 

15 Transition 

16 PART 1—GREEN JOBS 

17 SEC. 301. CLEAN ENERGY CURRICULUM DEVELOPMENT 

18 GRANTS. 

19 (a) AUTHORIZATION.—The Secretary of Education is 

20 authorized to award grants, on a competitive basis, to eligi21 ble partnerships to develop programs of study (containing 

22 the information described in section 122(c)(1)(A) of the 

23 Carl D. Perkins Career and Technical Education Act of 

24 2006 (20 U.S.C. 2342)), that are focused on emerging ca25 reers and jobs in the fields of clean energy, renewable enVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01090 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ergy, energy efficiency, climate change mitigation, and cli2 mate change adaptation. The Secretary of Education shall 

3 consult with the Secretary of Labor and the Secretary of 

4 Energy prior to the issuance of a solicitation for grant ap5 plications. 

6 (b) ELIGIBLE PARTNERSHIPS.—For purposes of this 

7 section, an eligible partnership shall include— 

8 (1) at least 1 local educational agency eligible 

9 for funding under section 131 of the Carl D. Perkins 

10 Career and Technical Education Act of 2006 (20 

11 U.S.C. 2351) or an area career and technical edu12 cation school or education service agency described in 

13 such section; 

14 (2) at least 1 postsecondary institution eligible 

15 for funding under section 132 of such Act (20 U.S.C. 

16 2352); and 

17 (3) representatives of the community including 

18 business, labor organizations, and industry that have 

19 experience in fields as described in subsection (a). 

20 (c) APPLICATION.—An eligible partnership seeking a 

21 grant under this section shall submit an application to the 

22 Secretary at such time and in such manner as the Secretary 

23 may require. Applications shall include— 

24 (1) a description of the eligible partners and 

25 partnership, the roles and responsibilities of each 


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1 partner, and a demonstration of each partner’s ca2 pacity to support the program; 

3 (2) a description of the career area or areas 

4 within the fields as described in subsection (a) to be 

5 developed, the reason for the choice, and evidence of 

6 the labor market need to prepare students in that 

7 area; 

8 (3) a description of the new or existing program 

9 of study and both secondary and postsecondary com10 ponents; 

11 (4) a description of the students to be served by 

12 the new program of study; 

13 (5) a description of how the program of study 

14 funded by the grant will be replicable and dissemi15 nated to schools outside of the partnership, including 

16 urban and rural areas; 

17 (6) a description of applied learning that will be 

18 incorporated into the program of study and how it 

19 will incorporate or reinforce academic learning; 

20 (7) a description of how the program of study 

21 will be delivered; 

22 (8) a description of how the program will pro23 vide accessibility to students, especially economically 

24 disadvantaged, low performing, and urban and rural 

25 students; 


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1 (9) a description of how the program will ad2 dress placement of students in nontraditional fields as 

3 described in section 3(20) of the Carl D. Perkins Ca4 reer and Technical Education Act of 2006 (20 U.S.C. 

5 2302(20)); and 

6 (10) a description of how the applicant proposes 

7 to consult or has consulted with a labor organization, 

8 labor management partnership, apprenticeship pro9 gram, or joint apprenticeship and training program 

10 that provides education and training in the field of 

11 study for which the applicant proposes to develop a 

12 curriculum. 

13 (d) PRIORITY.—The Secretary shall give priority to 

14 applications that— 

15 (1) use online learning or other innovative 

16 means to deliver the program of study to students, 

17 educators, and instructors outside of the partnership; 

18 and 

19 (2) focus on low performing students and special 

20 populations as defined in section 3(29) of the Carl D. 

21 Perkins Career and Technical Education Act of 2006 

22 (20 U.S.C. 2302(29)). 

23 (e) PEER REVIEW.—The Secretary shall convene a 

24 peer review process to review applications for grants under 

25 this section and to make recommendations regarding the seVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01093 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 lection of grantees. Members of the peer review committee 

2 shall include— 

3 (1) educators who have experience implementing 

4 curricula with comparable purposes; and 

5 (2) business and industry experts in fields as de6 scribed in subsection (a). 

7 (f) USES OF FUNDS.—Grants awarded under this sec8 tion shall be used for the development, implementation, and 

9 dissemination of programs of study (as described in section 

10 122(c)(1)(A) of the Carl D. Perkins Career and Technical 

11 Education Act (20 U.S.C. 2342(c)(1)(A))) in career areas 

12 related to clean energy, renewable energy, energy efficiency, 

13 climate change mitigation, and climate change adaptation. 

14 SEC. 302. DEVELOPMENT OF INFORMATION AND RE15 SOURCES CLEARINGHOUSE FOR VOCATIONAL 

16 EDUCATION AND JOB TRAINING IN RENEW17 ABLE ENERGY SECTORS. 

18 (a) DEVELOPMENT OF CLEARINGHOUSE.—Not later 

19 than 18 months after the date of enactment of this Act, the 

20 Secretary of Labor, in collaboration with the Secretary of 

21 Energy and the Secretary of Education, shall develop an 

22 internet based information and resources clearinghouse to 

23 aid career and technical education and job training pro24 grams for the renewable energy sectors. In establishing the 

25 clearinghouse, the Secretary shall— 


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1 (1) collect and provide information that address2 es the consequences of rapid changes in technology 

3 and regional disparities for renewable energy train4 ing programs and provides best practices for training 

5 and education in light of such changes and dispari6 ties; 

7 (2) place an emphasis on facilitating collabora8 tion between the renewable energy industry and job 

9 training programs and on identifying industry and 

10 technological trends and best practices, to better help 

11 job training programs maintain quality and rel12 evance; and 

13 (3) place an emphasis on assisting programs 

14 that cater to high-demand middle-skill, trades, manu15 facturing, contracting, and consulting careers. 

16 (b) SOLICITATION AND CONSULTATION.—In developing 

17 the clearinghouse pursuant to subsection (a), the Secretary 

18 shall solicit information and expertise from businesses and 

19 organizations in the renewable energy sector and from insti20 tutions of higher education, career and technical schools, 

21 and community colleges that provide training in the renew22 able energy sectors. The Secretary shall solicit a comprehen23 sive peer review of the clearinghouse by such entities not 

24 less than once every 2 years. Nothing in this subsection 


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1 should be interpreted to require the divulgence of propri2 etary or competitive information. 

3 (c) CONTENTS OF CLEARINGHOUSE.— 

4 (1) SEPARATE SECTION FOR EACH RENEWABLE

5 ENERGY SECTOR.—The clearinghouse shall contain 

6 separate sections developed for each of the following 

7 renewable energy sectors: 

8 (A) Solar energy systems. 

9 (B) Wind energy systems. 

10 (C) Energy transmission systems. 

11 (D) Geothermal systems of energy and heat12 ing. 

13 (E) Energy efficiency technical training. 

14 (2) ADDITIONAL REQUIREMENTS.—In addition 

15 to the information required in subsection (a), each 

16 section of the clearinghouse shall include information 

17 on basic environmental science and processes needed 

18 to understand renewable energy systems, Federal gov19 ernment and industry resources, and points of contact 

20 to aid institutions in the development of placement 

21 programs for apprenticeships and post graduation op22 portunities, and information and tips about a green 

23 workplace, energy efficiency, and relevant environ24 mental topics and information on available industry 

25 recognized certifications in each area. 


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1 (d) DISSEMINATION.—The clearinghouse shall be made 

2 available via the Internet to the general public. Notice of 

3 the completed clearinghouse and any major revisions thereto 

4 shall also be provided— 

5 (1) to each Member of Congress; and 

6 (2) on the websites of the Departments of Edu7 cation, Energy, and Labor. 

8 (e) REVISION.—The Secretary of Labor shall revise 

9 and update the clearinghouse on a regular basis to ensure 

10 its relevance. 

11 SEC. 303. GREEN CONSTRUCTION CAREERS DEMONSTRA12 TION PROJECT. 

13 (a) ESTABLISHMENT AND AUTHORITY.—The Secretary 

14 of Labor, in consultation with the Secretary of Energy, 

15 shall, not later than 180 days after the enactment of this 

16 Act, establish a Green Construction Careers demonstration 

17 project by rules, regulations, and guidance in accordance 

18 with the provisions of this section. The purpose of the dem19 onstration project shall be to promote middle class careers 

20 and quality employment practices in the green construction 

21 sector among targeted workers and to advance efficiency 

22 and performance on construction projects related to this 

23 Act. In order to advance these purposes, the Secretary shall 

24 identify projects, including residential retrofitting projects, 

25 funded directly by or assisted in whole or in part by or 


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1 through the Federal Government pursuant to this Act or 

2 by any other entity established in accordance with this Act, 

3 to which all of the following shall apply. 

4 (b) REQUIREMENTS.—The Secretaries may establish 

5 such terms and conditions for the demonstration projects 

6 as the Secretaries determine are necessary to meet the pur7 poses of subsection (a), including establishing minimum 

8 proportions of hours to be worked by targeted workers on 

9 such projects. The Secretaries may require the contractors 

10 and subcontractors performing construction services on the 

11 project to comply with the terms and conditions as a condi12 tion of receiving funding or assistance from the Federal 

13 Government under this Act. 

14 (c) EVALUATION.—The Secretaries shall evaluate the 

15 demonstration projects against the purposes of this section 

16 at the end of 3 years from initiation of the demonstration 

17 project. If the Secretaries determine that the demonstration 

18 projects have been successful, the Secretaries may identify 

19 further projects to which of the provisions of this section 

20 shall apply. 

21 (d) GAO REPORT.—The Comptroller General shall 

22 prepare and submit a report to the Committee on Health, 

23 Education, Labor, and Pensions and the Committee on En24 ergy and Natural Resources of the Senate and the Com25 mittee on Education and Labor and the Committee on EnVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01098 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ergy and Commerce of the House of Representatives not 

2 later than 5 years after the date of enactment of this Act, 

3 which shall advise the committees of the results of the dem4 onstration projects and make appropriate recommenda5 tions. 

6 (e) DEFINITION AND DESIGNATION OF TARGETED

7 WORKERS.—As used in this section, the term ‘‘targeted 

8 worker’’ means an individual who resides in the same labor 

9 market area (as defined in section 101(18) of the Workforce 

10 Investment Act of 1998 (29 U.S.C. 2801(18))) as the project 

11 and who— 

12 (1) is a member of a targeted group, within the 

13 meaning of section 51 of the Internal Revenue Code 

14 of 1986, other than an individual described in sub15 section (d)(1)(C) of such section; 

16 (2)(A) resides in a census tract in which not less 

17 than 20 percent of the households have incomes below 

18 the Federal poverty guidelines; or 

19 (B) is a member of a family that received a total 

20 family income that, during the 2-year period prior to 

21 employment on the project or admission to the pre22 apprenticeship program, did not exceed 200 percent of 

23 the Federal poverty guidelines (exclusive of unemploy24 ment compensation, child support payments, pay25 ments described in section 101(25)(A) of the WorkVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01099 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 force Investment Act (29 U.S.C. 2801(25)(A)), and 

2 old-age and survivors insurance benefits received 

3 under section 202 of the Social Security Act (42 

4 U.S.C. 402); or 

5 (3) is a displaced homemaker, as such term is 

6 defined in section 3(10) of the Carl D. Perkins Career 

7 and Technical Education Act of 2006 (20 U.S.C. 

8 2302(10)). 

9 (f) QUALIFIED PRE-APPRENTICESHIP PROGRAM.—A 

10 qualified pre-apprenticeship program is a pre-apprentice11 ship program that has demonstrated an ability to recruit, 

12 train, and prepare for admission to apprenticeship pro13 grams individuals who are targeted workers. 

14 (g) QUALIFIED APPRENTICESHIP AND OTHER TRAIN15 ING PROGRAMS.— 

16 (1) PARTICIPATION BY EACH CONTRACTOR RE17 QUIRED.—Each contractor and subcontractor that 

18 seeks to provide construction services on projects iden19 tified by the Secretaries pursuant to subsection (a) 

20 shall submit adequate assurances with its bid or pro21 posal that it participates in a qualified apprentice22 ship or other training program, with a written ar23 rangement with a qualified pre-apprenticeship pro24 gram, for each craft or trade classification of worker 


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1 that it intends to employ to perform work on the 

2 project. 

3 (2) DEFINITION OF QUALIFIED APPRENTICE SHIP

4 OR OTHER TRAINING PROGRAM.— 

5 (A) IN GENERAL.—For purposes of this sec6 tion, the term ‘‘qualified apprenticeship or other 

7 training program’’ means an apprenticeship or 

8 other training program that qualifies as an em9 ployee welfare benefit plan, as defined in section 

10 3(1) of the Employee Retirement Income Secu11 rity Act of 1974 (29 U.S.C. 1002(1)). 

12 (B) CERTIFICATION OF OTHER PROGRAMS

13 IN CERTAIN LOCALITIES.—In the event that the 

14 Secretary of Labor certifies that a qualified ap15 prenticeship or other training program (as de16 fined in subparagraph (A)) for a craft or trade 

17 classification of workers that a prospective con18 tractor or subcontractor intends to employ, is not 

19 operated in the locality where the project will be 

20 performed, an apprenticeship or other training 

21 program that is not an employee welfare benefit 

22 plan (as defined in such section) may be certified 

23 by the Secretary as a qualified apprenticeship or 

24 other training program provided it is registered 

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1 ment of Labor, or a State apprenticeship agency 

2 recognized by the Office of Apprenticeship for 

3 Federal purposes. 

4 (h) FACILITATING COMPLIANCE.—The Secretary may 

5 require Federal contracting agencies, recipients of Federal 

6 assistance, and any other entity established in accordance 

7 with this Act to require contractors to enter into an agree8 ment in a manner comparable with the standards set forth 

9 in sections 3 and 4 of Executive Order 13502 in order to 

10 achieve the purposes of this section, including any require11 ments established by subsection (b). 

12 (i) LIMITATION.—The requirements of this section 

13 shall not apply to any project funded under this Act in 

14 American Samoa, Guam, the Commonwealth of the North15 ern Mariana Islands, the Commonwealth of Puerto Rico, 

16 or the United States Virgin Islands, unless participation 

17 is requested by the governor of such territories within 1 year 

18 of the promulgation of rules under this Act. 

19 PART 2—CLIMATE CHANGE WORKER 

20 ADJUSTMENT ASSISTANCE 

21 SEC. 311. PETITIONS, ELIGIBILITY REQUIREMENTS, AND DE22 TERMINATIONS. 

23 (a) PETITIONS.— 

24 (1) FILING.—A petition for certification of eligi25 bility to apply for adjustment assistance for a group 


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1 of workers under this part may be filed by any of the 

2 following: 

3 (A) The group of workers. 

4 (B) The certified or recognized union or 

5 other duly authorized representative of such 

6 workers. 

7 (C) Employers of such workers, one-stop op8 erators or one-stop partners (as defined in sec9 tion 101 of the Workforce Investment Act of 1998 

10 (29 U.S.C. 2801)), including State employment 

11 security agencies, or the State dislocated worker 

12 unit established under title I of such Act, on be13 half of such workers. 

14 The petition shall be filed simultaneously with the 

15 Secretary of Labor and with the Governor of the State 

16 in which such workers’ employment site is located. 

17 (2) ACTION BY GOVERNORS.—Upon receipt of a 

18 petition filed under paragraph (1), the Governor 

19 shall— 

20 (A) ensure that rapid response activities 

21 and appropriate core and intensive services (as 

22 described in section 134 of the Workforce Invest23 ment Act of 1998 (29 U.S.C. 2864)) authorized 

24 under other Federal laws are made available to 


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1 the workers covered by the petition to the extent 

2 authorized under such laws; and 

3 (B) assist the Secretary in the review of the 

4 petition by verifying such information and pro5 viding such other assistance as the Secretary 

6 may request. 

7 (3) ACTION BY THE SECRETARY.—Upon receipt 

8 of the petition, the Secretary shall promptly publish 

9 notice in the Federal Register and on the website of 

10 the Department of Labor that the Secretary has re11 ceived the petition and initiated an investigation. 

12 (4) HEARINGS.—If the petitioner, or any other 

13 person found by the Secretary to have a substantial 

14 interest in the proceedings, submits not later than 10 

15 days after the date of the Secretary’s publication 

16 under paragraph (3) a request for a hearing, the Sec17 retary shall provide for a public hearing and afford 

18 such interested persons an opportunity to be present, 

19 to produce evidence, and to be heard. 

20 (b) ELIGIBILITY.— 

21 (1) IN GENERAL.—A group of workers shall be 

22 certified by the Secretary as eligible to apply for ad23 justment assistance under this part pursuant to a pe24 tition filed under subsection (a) if— 

25 (A) the group of workers is employed in— 


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1 (i) energy producing and transforming 

2 industries; 

3 (ii) industries dependent upon energy 

4 industries; 

5 (iii) energy-intensive manufacturing 

6 industries; 

7 (iv) consumer goods manufacturing; or 

8 (v) other industries whose employment 

9 the Secretary determines has been adversely 

10 affected by any requirement of title VII of 

11 the Clean Air Act; 

12 (B) the Secretary determines that a signifi13 cant number or proportion of the workers in 

14 such workers’ employment site have become to15 tally or partially separated, or are threatened to 

16 become totally or partially separated from em17 ployment; and 

18 (C) the sales, production, or delivery of 

19 goods or services have decreased as a result of 

20 any requirement of title VII of the Clean Air 

21 Act, including— 

22 (i) the shift from reliance upon fossil 

23 fuels to other sources of energy, including 

24 renewable energy, that results in the closing 

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1 cility that mines, produces, processes, or 

2 utilizes fossil fuels to generate electricity; 

3 (ii) a substantial increase in the cost of 

4 energy required for a manufacturing facil5 ity to produce items whose prices are com6 petitive in the marketplace, to the extent the 

7 cost is not offset by assistance provided to 

8 the facility pursuant to title VII of the 

9 Clean Air Act; or 

10 (iii) other documented occurrences that 

11 the Secretary determines are indicators of 

12 an adverse impact on an industry described 

13 in subparagraph (A) as a result of any re14 quirement of title VII of the Clean Air Act. 

15 (2) WORKERS IN PUBLIC AGENCIES.—A group of 

16 workers in a public agency shall be certified by the 

17 Secretary as eligible to apply for climate change ad18 justment assistance pursuant to a petition filed if the 

19 Secretary determines that a significant number or 

20 proportion of the workers in the public agency have 

21 become totally or partially separated from employ22 ment, or are threatened to become totally or partially 

23 separated as a result of any requirement of title VII 

24 of the Clean Air Act. 


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1 (3) ADVERSELY AFFECTED SERVICE WORKERS.— 

2 A group of workers shall be certified as eligible to 

3 apply for climate change adjustment assistance pur4 suant to a petition filed if the Secretary determines 

5 that— 

6 (A) a significant number or proportion of 

7 the service workers at an employment site where 

8 a group of workers has been certified by the Sec9 retary as eligible to apply for adjustment assist10 ance under this part pursuant to paragraph (1) 

11 have become totally or partially separated from 

12 employment, or are threatened to become totally 

13 or partially separated; and 

14 (B) a loss of business in the firm providing 

15 service workers to an employment site is directly 

16 attributable to one or more of the documented oc17 currences listed in paragraph (1)(C). 

18 (c) AUTHORITY TO INVESTIGATE AND COLLECT INFOR19 MATION.— 

20 (1) IN GENERAL.—The Secretary shall, in deter21 mining whether to certify a group of workers under 

22 subsection (d), obtain information the Secretary de23 termines to be necessary to make the certification, 

24 through questionnaires and in such other manner as 

25 the Secretary determines appropriate from— 


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1 (A) the workers’ employer; 

2 (B) officials of certified or recognized 

3 unions or other duly authorized representatives 

4 of the group of workers; or 

5 (C) one-stop operators or one-stop partners 

6 (as defined in section 101 of the Workforce In7 vestment Act of 1998 (29 U.S.C. 2801)). 

8 (2) VERIFICATION OF INFORMATION.—The Sec9 retary shall require an employer, union, or one-stop 

10 operator or partner to certify all information ob11 tained under paragraph (1) from the employer, 

12 union, or one-stop operator or partner (as the case 

13 may be) on which the Secretary relies in making a 

14 determination under subsection (d), unless the Sec15 retary has a reasonable basis for determining that 

16 such information is accurate and complete without 

17 being certified. 

18 (3) PROTECTION OF CONFIDENTIAL INFORMA19 TION.—The Secretary may not release information 

20 obtained under paragraph (1) that the Secretary con21 siders to be confidential business information unless 

22 the employer submitting the confidential business in23 formation had notice, at the time of submission, that 

24 the information would be released by the Secretary, or 

25 the employer subsequently consents to the release of 


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1 the information. Nothing in this paragraph shall be 

2 construed to prohibit the Secretary from providing 

3 such confidential business information to a court in 

4 camera or to another party under a protective order 

5 issued by a court. 

6 (d) DETERMINATION BY THE SECRETARY OF LABOR.— 

7 (1) IN GENERAL.—As soon as possible after the 

8 date on which a petition is filed under subsection (a), 

9 but in any event not later than 40 days after that 

10 date, the Secretary, in consultation with the Secretary 

11 of Energy and the Administrator, as necessary, shall 

12 determine whether the petitioning group meets the re13 quirements of subsection (b) and shall issue a certifi14 cation of eligibility to apply for assistance under this 

15 part covering workers in any group which meets such 

16 requirements. Each certification shall specify the date 

17 on which the total or partial separation began or 

18 threatened to begin. Upon reaching a determination 

19 on a petition, the Secretary shall promptly publish a 

20 summary of the determination in the Federal Register 

21 and on the website of the Department of Labor, to22 gether with the Secretary’s reasons for making such 

23 determination. 

24 (2) ONE YEAR LIMITATION.—A certification 

25 under this section shall not apply to any worker 


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1 whose last total or partial separation from the em2 ployment site before the worker’s application under 

3 section 312(a) occurred more than 1 year before the 

4 date of the petition on which such certification was 

5 granted. 

6 (3) REVOCATION OF CERTIFICATION.—Whenever 

7 the Secretary determines, with respect to any certifi8 cation of eligibility of the workers of an employment 

9 site, that total or partial separations from such site 

10 are no longer a result of the factors specified in sub11 section (b)(1), the Secretary shall terminate such cer12 tification and promptly have notice of such termi13 nation published in the Federal Register and on the 

14 website of the Department of Labor, together with the 

15 Secretary’s reasons for making such determination. 

16 Such termination shall apply only with respect to 

17 total or partial separations occurring after the termi18 nation date specified by the Secretary. 

19 (e) INDUSTRY NOTIFICATION OF ASSISTANCE.—Upon 

20 receiving a notification of a determination under subsection 

21 (d) with respect to a domestic industry the Secretary of 

22 Labor shall notify the representatives of the domestic indus23 try affected by the determination, employers publicly iden24 tified by name during the course of the proceeding relating 

25 to the determination, and any certified or recognized union 


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1 or, to the extent practicable, other duly authorized rep2 resentative of workers employed by such representatives of 

3 the domestic industry, of— 

4 (1) the adjustment assistance, training, and 

5 other benefits available under this part; 

6 (2) the manner in which to file a petition and 

7 apply for such benefits; 

8 (3) the availability of assistance in filing such 

9 petitions; 

10 (4) notify the Governor of each State in which 

11 one or more employers in such industry are located 

12 of the Secretary’s determination and the identity of 

13 the employers; and 

14 (5) upon request, provide any assistance that is 

15 necessary to file a petition under subsection (a). 

16 (f) BENEFIT INFORMATION TO WORKERS, PROVIDERS

17 OF TRAINING.— 

18 (1) IN GENERAL.—The Secretary shall provide 

19 full information to workers about the adjustment as20 sistance, training, and other benefits available under 

21 this part and about the petition and application pro22 cedures, and the appropriate filing dates, for such as23 sistance, training and services. The Secretary shall 

24 provide whatever assistance is necessary to enable 

25 groups of workers to prepare petitions or applications 


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1 for program benefits. The Secretary shall make every 

2 effort to insure that cooperating State agencies fully 

3 comply with the agreements entered into under sec4 tion 312(a) and shall periodically review such com5 pliance. The Secretary shall inform the State Board 

6 for Vocational Education or equivalent agency, the 

7 one-stop operators or one-stop partners (as defined in 

8 section 101 of the Workforce Investment Act of 1998 

9 (29 U.S.C. 2801)), and other public or private agen10 cies, institutions, and employers, as appropriate, of 

11 each certification issued under subsection (d) and of 

12 projections, if available, of the needs for training 

13 under as a result of such certification. 

14 (2) NOTICE BY MAIL.—The Secretary shall pro15 vide written notice through the mail of the benefits 

16 available under this part to each worker whom the 

17 Secretary has reason to believe is covered by a certifi18 cation made under subsection (d)— 

19 (A) at the time such certification is made, 

20 if the worker was partially or totally separated 

21 from the adversely affected employment before 

22 such certification; or 

23 (B) at the time of the total or partial sepa24 ration of the worker from the adversely affected 


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1 employment, if subparagraph (A) does not 

2 apply. 

3 (3) NEWSPAPERS; WEBSITE.—The Secretary 

4 shall publish notice of the benefits available under 

5 this part to workers covered by each certification 

6 made under subsection (d) in newspapers of general 

7 circulation in the areas in which such workers reside 

8 and shall make such information available on the 

9 website of the Department of Labor. 

10 SEC. 312. PROGRAM BENEFITS. 

11 (a) CLIMATE CHANGE ADJUSTMENT ASSISTANCE.— 

12 (1) ELIGIBILITY.—Payment of climate change 

13 adjustment assistance shall be made to an adversely 

14 affected worker covered by a certification under sec15 tion 311(b) who files an application for such assist16 ance for any week of unemployment which begins on 

17 or after the date of such certification, if the following 

18 conditions are met: 

19 (A) Such worker’s total or partial separa20 tion before the worker’s application under this 

21 part occurred— 

22 (i) on or after the date, as specified in 

23 the certification under which the worker is 

24 covered, on which total or partial separaVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01113 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 tion began or threatened to begin in the ad2 versely affected employment; 

3 (ii) before the expiration of the 2-year 

4 period beginning on the date on which the 

5 determination under section 311(d) was 

6 made; and 

7 (iii) before the termination date, if 

8 any, determined pursuant to section 

9 311(d)(3). 

10 (B) Such worker had, in the 52-week period 

11 ending with the week in which such total or par12 tial separation occurred, at least 26 weeks of 

13 full-time employment or 1,040 hours of part time 

14 employment in adversely affected employment, 

15 or, if data with respect to weeks of employment 

16 are not available, equivalent amounts of employ17 ment computed under regulations prescribed by 

18 the Secretary. For the purposes of this para19 graph, any week in which such worker— 

20 (i) is on employer-authorized leave for 

21 purposes of vacation, sickness, injury, ma22 ternity, or inactive duty or active duty 

23 military service for training; 

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1 men’s compensation law or plan of a State 

2 or the United States; 

3 (iii) had his employment interrupted 

4 in order to serve as a full-time representa5 tive of a labor organization in such firm; or 

6 (iv) is on call-up for purposes of active 

7 duty in a reserve status in the Armed 

8 Forces of the United States, provided such 

9 active duty is ‘‘Federal service’’ as defined 

10 in section 8521(a)(1) of title 5, United 

11 States Code, 

12 shall be treated as a week of employment. 

13 (C) Such worker is enrolled in a training 

14 program approved by the Secretary under sub15 section (b)(2). 

16 (2) INELIGIBILITY FOR CERTAIN OTHER BENE17 FITS.—An adversely affected worker receiving a pay18 ment under this section shall be ineligible to receive 

19 any other form of unemployment insurance for the 

20 period in which such worker is receiving climate 

21 change adjustment assistance under this section. 

22 (3) REVOCATION.—If— 

23 (A) the Secretary determines that— 

24 (i) the adversely affected worker— 


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1 (I) has failed to begin participa2 tion in the training program the en3 rollment in which meets the require4 ment of paragraph (1)(C); or 

5 (II) has ceased to participate in 

6 such training program before com7 pleting such training program; and 

8 (ii) there is no justifiable cause for 

9 such failure or cessation; or 

10 (B) the certification made with respect to 

11 such worker under section 311(d) is revoked 

12 under paragraph (3) of such section, 

13 no adjustment assistance may be paid to the ad14 versely affected worker under this part for the week in 

15 which such failure, cessation, or revocation occurred, 

16 or any succeeding week, until the adversely affected 

17 worker begins or resumes participation in a training 

18 program approved by the Secretary under subsection 

19 (b)(2). 

20 (4) WAIVERS OF TRAINING REQUIREMENTS.—The 

21 Secretary may issue a written statement to an ad22 versely affected worker waiving the requirement to be 

23 enrolled in training described in subsection (b)(2) if 

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1 propriate for the worker, because of 1 or more of the 

2 following reasons: 

3 (A) RECALL.—The worker has been notified 

4 that the worker will be recalled by the employer 

5 from which the separation occurred. 

6 (B) MARKETABLE SKILLS.— 

7 (i) IN GENERAL.—The worker possesses 

8 marketable skills for suitable employment 

9 (as determined pursuant to an assessment 

10 of the worker, which may include the 

11 profiling system under section 303(j) of the 

12 Social Security Act (42 U.S.C. 503(j)), car13 ried out in accordance with guidelines 

14 issued by the Secretary) and there is a rea15 sonable expectation of employment at equiv16 alent wages in the foreseeable future. 

17 (ii) MARKETABLE SKILLS DEFINED.— 

18 For purposes of clause (i), the term ‘‘mar19 ketable skills’’ may include the possession of 

20 a postgraduate degree from an institution of 

21 higher education (as defined in section 102 

22 of the Higher Education Act of 1965 (20 

23 U.S.C. 1002)) or an equivalent institution, 

24 or the possession of an equivalent post25 graduate certification in a specialized field. 


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1 (C) RETIREMENT.—The worker is within 2 

2 years of meeting all requirements for entitlement 

3 to either— 

4 (i) old-age insurance benefits under 

5 title II of the Social Security Act (42 

6 U.S.C. 401 et seq.) (except for application 

7 therefor); or 

8 (ii) a private pension sponsored by an 

9 employer or labor organization. 

10 (D) HEALTH.—The worker is unable to 

11 participate in training due to the health of the 

12 worker, except that a waiver under this subpara13 graph shall not be construed to exempt a worker 

14 from requirements relating to the availability for 

15 work, active search for work, or refusal to accept 

16 work under Federal or State unemployment com17 pensation laws. 

18 (E) ENROLLMENT UNAVAILABLE.—The first 

19 available enrollment date for the training of the 

20 worker is within 60 days after the date of the de21 termination made under this paragraph, or, if 

22 later, there are extenuating circumstances for the 

23 delay in enrollment, as determined pursuant to 

24 guidelines issued by the Secretary. 


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1 (F) TRAINING NOT AVAILABLE.—Training 

2 described in subsection (b)(2) is not reasonably 

3 available to the worker from either governmental 

4 agencies or private sources (which may include 

5 area career and technical education schools, as 

6 defined in section 3 of the Carl D. Perkins Ca7 reer and Technical Education Act of 2006 (20 

8 U.S.C. 2302), and employers), no training that 

9 is suitable for the worker is available at a rea10 sonable cost, or no training funds are available. 

11 (5) WEEKLY AMOUNTS.—The climate change ad12 justment assistance payable to an adversely affected 

13 worker for a week of unemployment shall be an 

14 amount equal to 70 percent of the average weekly 

15 wage of such worker, but in no case shall such 

16 amount exceed the average weekly wage for all work17 ers in the State where the adversely affected worker 

18 resides. 

19 (6) MAXIMUM DURATION OF BENEFITS.—An eli20 gible worker may receive a climate change adjustment 

21 assistance under this subsection for a period of not 

22 longer than 156 weeks. 

23 (b) EMPLOYMENT SERVICES AND TRAINING.— 

24 (1) INFORMATION AND EMPLOYMENT SERV25 ICES.—The Secretary shall make available, directly or 


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1 through agreements with the States under section 

2 313(a) to adversely affected workers covered by a cer3 tification under section 311(a) the following informa4 tion and employment services: 

5 (A) Comprehensive and specialized assess6 ment of skill levels and service needs, including 

7 through— 

8 (i) diagnostic testing and use of other 

9 assessment tools; and 

10 (ii) in-depth interviewing and evalua11 tion to identify employment barriers and 

12 appropriate employment goals. 

13 (B) Development of an individual employ14 ment plan to identify employment goals and ob15 jectives, and appropriate training to achieve 

16 those goals and objectives. 

17 (C) Information on training available in 

18 local and regional areas, information on indi19 vidual counseling to determine which training is 

20 suitable training, and information on how to 

21 apply for such training. 

22 (D) Information on training programs and 

23 other services provided by a State pursuant to 

24 title I of the Workforce Investment Act of 1998 

25 (29 U.S.C. 2801 et seq.) and available in local 


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1 and regional areas, information on individual 

2 counseling to determine which training is suit3 able training, and information on how to apply 

4 for such training. 

5 (E) Information on how to apply for finan6 cial aid, including referring workers to edu7 cational opportunity centers described in section 

8 402F of the Higher Education Act of 1965 (20 

9 U.S.C. 1070a–16), where applicable, and noti10 fying workers that the workers may request fi11 nancial aid administrators at institutions of 

12 higher education (as defined in section 102 of 

13 such Act (20 U.S.C. 1002)) to use the adminis14 trators’ discretion under section 479A of such 

15 Act (20 U.S.C. 1087tt) to use current year in16 come data, rather than preceding year income 

17 data, for determining the amount of need of the 

18 workers for Federal financial assistance under 

19 title IV of such Act (20 U.S.C. 1070 et seq.). 

20 (F) Short-term prevocational services, in21 cluding development of learning skills, commu22 nications skills, interviewing skills, punctuality, 

23 personal maintenance skills, and professional 

24 conduct to prepare individuals for employment 

25 or training. 


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1 (G) Individual career counseling, including 

2 job search and placement counseling, during the 

3 period in which the individual is receiving cli4 mate change adjustment assistance or training 

5 under this part, and after receiving such train6 ing for purposes of job placement. 

7 (H) Provision of employment statistics in8 formation, including the provision of accurate 

9 information relating to local, regional, and na10 tional labor market areas, including— 

11 (i) job vacancy listings in such labor 

12 market areas; 

13 (ii) information on jobs skills nec14 essary to obtain jobs identified in job va15 cancy listings described in subparagraph 

16 (A); 

17 (iii) information relating to local occu18 pations that are in demand and earnings 

19 potential of such occupations; and 

20 (iv) skills requirements for local occu21 pations described in subparagraph (C). 

22 (I) Information relating to the availability 

23 of supportive services, including services relating 

24 to child care, transportation, dependent care, 

25 housing assistance, and need-related payments 


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1 that are necessary to enable an individual to 

2 participate in training. 

3 (2) TRAINING.— 

4 (A) APPROVAL OF AND PAYMENT FOR

5 TRAINING.—If the Secretary determines, with re6 spect to an adversely affected worker that— 

7 (i) there is no suitable employment 

8 (which may include technical and profes9 sional employment) available for an ad10 versely affected worker; 

11 (ii) the worker would benefit from ap12 propriate training; 

13 (iii) there is a reasonable expectation 

14 of employment following completion of such 

15 training; 

16 (iv) training approved by the Sec17 retary is reasonably available to the worker 

18 from either governmental agencies or pri19 vate sources (including area career and 

20 technical education schools, as defined in 

21 section 3 of the Carl D. Perkins Career and 

22 Technical Education Act of 2006 (20 U.S.C. 

23 2302), and employers); 

24 (v) the worker is qualified to undertake 

25 and complete such training; and 


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1 (vi) such training is suitable for the 

2 worker and available at a reasonable cost, 

3 the Secretary shall approve such training for the 

4 worker. Upon such approval, the worker shall be 

5 entitled to have payment of the costs of such 

6 training (subject to the limitations imposed by 

7 this section) paid on the worker’s behalf by the 

8 Secretary directly or through a voucher system. 

9 (B) DISTRIBUTION.—The Secretary shall es10 tablish procedures for the distribution of the 

11 funds to States to carry out the training pro12 grams approved under this paragraph, and shall 

13 make an initial distribution of the funds made 

14 available as soon as practicable after the begin15 ning of each fiscal year. 

16 (C) ADDITIONAL RULES REGARDING AP17 PROVAL OF AND PAYMENT FOR TRAINING.— 

18 (i) For purposes of applying subpara19 graph (A)(iii), a reasonable expectation of 

20 employment does not require that employ21 ment opportunities for a worker be avail22 able, or offered, immediately upon the com23 pletion of training approved under such 

24 subparagraph. 


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1 (ii) If the costs of training an ad2 versely affected worker are paid by the Sec3 retary under subparagraph (A), no other 

4 payment for such costs may be made under 

5 any other provision of Federal law. No pay6 ment may be made under subparagraph (A) 

7 of the costs of training an adversely affected 

8 worker or an adversely affected incumbent 

9 worker if such costs— 

10 (I) have already been paid under 

11 any other provision of Federal law; or 

12 (II) are reimbursable under any 

13 other provision of Federal law and a 

14 portion of such costs have already been 

15 paid under such other provision of 

16 Federal law. 

17 The provisions of this clause shall not apply 

18 to, or take into account, any funds provided 

19 under any other provision of Federal law 

20 which are used for any purpose other than 

21 the direct payment of the costs incurred in 

22 training a particular adversely affected 

23 worker, even if such use has the effect of in24 directly paying or reducing any portion of 


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1 the costs involved in training the adversely 

2 affected worker. 

3 (D) TRAINING PROGRAMS.—The training 

4 programs that may be approved under subpara5 graph (A) include— 

6 (i) employer-based training, includ7 ing— 

8 (I) on-the-job training if approved 

9 by the Secretary under subsection (c); 

10 and 

11 (II) joint labor-management ap12 prenticeship programs; 

13 (ii) any training program provided by 

14 a State pursuant to title I of the Workforce 

15 Investment Act of 1998 (29 U.S.C. 2801 et 

16 seq.); 

17 (iii) any programs in career and tech18 nical education described in section 3(5) of 

19 the Carl D. Perkins Career and Technical 

20 Education Act of 2006 (20 U.S.C. 2302(5)); 

21 (iv) any program of remedial edu22 cation; 

23 (v) any program of prerequisite edu24 cation or coursework required to enroll in 


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1 training that may be approved under this 

2 paragraph; 

3 (vi) any training program for which 

4 all, or any portion, of the costs of training 

5 the worker are paid— 

6 (I) under any Federal or State 

7 program other than this part; or 

8 (II) from any source other than 

9 this part; 

10 (vii) any training program or 

11 coursework at an accredited institution of 

12 higher education (described in section 102 

13 of the Higher Education Act of 1965 (20 

14 U.S.C. 1002)), including a training pro15 gram or coursework for the purpose of— 

16 (I) obtaining a degree or certifi17 cation; or 

18 (II) completing a degree or certifi19 cation that the worker had previously 

20 begun at an accredited institution of 

21 higher education; and 

22 (viii) any other training program ap23 proved by the Secretary. 

24 (3) SUPPLEMENTAL ASSISTANCE.—The Secretary 

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1 ance that is necessary to defray reasonable transpor2 tation and subsistence expenses for separate mainte3 nance in a case in which training for a worker is 

4 provided in a facility that is not within commuting 

5 distance of the regular place of residence of the work6 er. 

7 (c) ON-THE-JOB TRAINING REQUIREMENTS.— 

8 (1) IN GENERAL.—The Secretary may approve 

9 on-the-job training for any adversely affected worker 

10 if— 

11 (A) the Secretary determines that on-the-job 

12 training— 

13 (i) can reasonably be expected to lead 

14 to suitable employment with the employer 

15 offering the on-the-job training; 

16 (ii) is compatible with the skills of the 

17 worker; 

18 (iii) includes a curriculum through 

19 which the worker will gain the knowledge or 

20 skills to become proficient in the job for 

21 which the worker is being trained; and 

22 (iv) can be measured by benchmarks 

23 that indicate that the worker is gaining 

24 such knowledge or skills; and 


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1 (B) the State determines that the on-the-job 

2 training program meets the requirements of 

3 clauses (iii) and (iv) of subparagraph (A). 

4 (2) MONTHLY PAYMENTS.—The Secretary shall 

5 pay the costs of on-the-job training approved under 

6 paragraph (1) in monthly installments. 

7 (3) CONTRACTS FOR ON-THE-JOB TRAINING.— 

8 (A) IN GENERAL.—The Secretary shall en9 sure, in entering into a contract with an em10 ployer to provide on-the-job training to a worker 

11 under this subsection, that the skill requirements 

12 of the job for which the worker is being trained, 

13 the academic and occupational skill level of the 

14 worker, and the work experience of the worker 

15 are taken into consideration. 

16 (B) TERM OF CONTRACT.—Training under 

17 any such contract shall be limited to the period 

18 of time required for the worker receiving on-the19 job training to become proficient in the job for 

20 which the worker is being trained, but may not 

21 exceed 156 weeks in any case. 

22 (4) EXCLUSION OF CERTAIN EMPLOYERS.—The 

23 Secretary shall not enter into a contract for on-the24 job training with an employer that exhibits a pattern 


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1 of failing to provide workers receiving on-the-job 

2 training from the employer with— 

3 (A) continued, long-term employment as 

4 regular employees; and 

5 (B) wages, benefits, and working conditions 

6 that are equivalent to the wages, benefits, and 

7 working conditions provided to regular employ8 ees who have worked a similar period of time 

9 and are doing the same type of work as workers 

10 receiving on-the-job training from the employer. 

11 (d) ADMINISTRATIVE AND EMPLOYMENT SERVICES

12 FUNDING.— 

13 (1) ADMINISTRATIVE FUNDING.—In addition to 

14 any funds made available to a State to carry out this 

15 section for a fiscal year, the State shall receive for the 

16 fiscal year a payment in an amount that is equal to 

17 15 percent of the amount of such funds and shall— 

(A) use not more than 2 18 ⁄3 of such payment 

19 for the administration of the climate change ad20 justment assistance for workers program under 

21 this part, including for— 

22 (i) processing waivers of training re23 quirements under subsection (a)(4); and 

24 (ii) collecting, validating, and report25 ing data required under this part; and 


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(B) use not less than 1 1 ⁄3 of such payment for 

2 information and employment services under sub3 section (b)(1). 

4 (2) EMPLOYMENT SERVICES FUNDING.— 

5 (A) IN GENERAL.—In addition to any funds 

6 made available to a State to carry out subsection 

7 (b)(2) and the payment under paragraph (1) for 

8 a fiscal year, the Secretary shall provide to the 

9 State for the fiscal year a reasonable payment 

10 for the purpose of providing employment and 

11 services under subsection (b)(1). 

12 (B) VOLUNTARY RETURN OF FUNDS.—A 

13 State that receives a payment under subpara14 graph (A) may decline or otherwise return such 

15 payment to the Secretary. 

16 (e) JOB SEARCH ASSISTANCE.—The Secretary of 

17 Labor may provide adversely affected workers one-time job 

18 search assistance in accordance with regulations prescribed 

19 by the Secretary. Any job search assistance provided shall 

20 be available only under the following circumstances and 

21 conditions: 

22 (1) The worker is no longer eligible for the cli23 mate change adjustment assistance under subsection 

24 (a) and has completed the training program required 

25 by subsection (b)(1)(E). 


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1 (2) The Secretary determines that the worker 

2 cannot reasonably be expected to secure suitable em3 ployment in the commuting area in which the worker 

4 resides. 

5 (3) Assistance granted shall provide reimburse6 ment to the worker of all necessary job search expenses 

7 as prescribed by the Secretary in regulations. Such 

8 reimbursement under this subsection may not exceed 

9 $1,500 for any worker. 

10 (f) RELOCATION ASSISTANCE AUTHORIZED.— 

11 (1) IN GENERAL.—Any adversely affected worker 

12 covered by a certification issued under section 311 

13 may file an application for relocation assistance with 

14 the Secretary, and the Secretary may grant the relo15 cation assistance, subject to the terms and conditions 

16 of this subsection. 

17 (2) CONDITIONS FOR GRANTING ASSISTANCE.— 

18 Relocation assistance may be granted if all of the fol19 lowing terms and conditions are met: 

20 (A) ASSIST AN ADVERSELY AFFECTED

21 WORKER.—The relocation assistance will assist 

22 an adversely affected worker in relocating within 

23 the United States. 

24 (B) LOCAL EMPLOYMENT NOT AVAILABLE.— 

25 The Secretary determines that the worker cannot 


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1 reasonably be expected to secure suitable employ2 ment in the commuting area in which the worker 

3 resides. 

4 (C) TOTAL SEPARATION.—The worker is to5 tally separated from employment at the time re6 location commences. 

7 (D) SUITABLE EMPLOYMENT OBTAINED.— 

8 The worker— 

9 (i) has obtained suitable employment 

10 affording a reasonable expectation of long11 term duration in the area in which the 

12 worker wishes to relocate; or 

13 (ii) has obtained a bona fide offer of 

14 such employment. 

15 (E) APPLICATION.—The worker filed an ap16 plication with the Secretary at such time and in 

17 such manner as the Secretary shall specify by 

18 regulation. 

19 (3) AMOUNT OF ASSISTANCE.—Relocation assist20 ance granted to a worker under paragraph (1) in21 cludes— 

22 (A) all reasonable and necessary expenses 

23 (including, subsistence and transportation ex24 penses at levels not exceeding amounts prescribed 

25 by the Secretary in regulations) incurred in 


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1 transporting the worker, the worker’s family, 

2 and household effects; and 

3 (B) a lump sum equivalent to 3 times the 

4 worker’s average weekly wage, up to a maximum 

5 payment of $1,500. 

6 (4) LIMITATIONS.—Relocation assistance may 

7 not be granted to a worker unless— 

8 (A) the relocation occurs within 182 days 

9 after the filing of the application for relocation 

10 assistance; or 

11 (B) the relocation occurs within 182 days 

12 after the conclusion of training, if the worker en13 tered a training program approved by the Sec14 retary under subsection (b)(2). 

15 (g) HEALTH INSURANCE CONTINUATION.—Not later 

16 than 1 year after the date of enactment of this Act, the Sec17 retary of Labor shall prescribe regulations to provide, for 

18 the period in which an adversely affected worker is partici19 pating in a training program described in subsection 

20 (b)(2), 80 percent of the monthly premium of any health 

21 insurance coverage that an adversely affected worker was 

22 receiving from such worker’s employer prior to the separa23 tion from employment described in section 311(b), to be 

24 paid to any health care insurance plan designated by the 


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1 adversely affected worker receiving assistance under this 

2 section. 

3 SEC. 313. GENERAL PROVISIONS. 

4 (a) AGREEMENTS WITH STATES.— 

5 (1) IN GENERAL.—The Secretary is authorized 

6 on behalf of the United States to enter into an agree7 ment with any State, or with any State agency (re8 ferred to in this section as ‘‘cooperating States’’ and 

9 ‘‘cooperating State agencies’’ respectively). Under 

10 such an agreement, the cooperating State or cooper11 ating State agency— 

12 (A) as agent of the United States, shall re13 ceive applications for, and shall provide, pay14 ments on the basis provided in this part; 

15 (B) in accordance with paragraph (6), shall 

16 make available to adversely affected workers cov17 ered by a certification under section 311(d) the 

18 employment services described in section 

19 312(b)(1); 

20 (C) shall make any certifications required 

21 under section 311(d); and 

22 (D) shall otherwise cooperate with the Sec23 retary and with other State and Federal agencies 

24 in providing payments and services under this 

25 part. 


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1 Each agreement under this section shall provide the 

2 terms and conditions upon which the agreement may 

3 be amended, suspended, or terminated. 

4 (2) FORM AND MANNER OF DATA.—Each agree5 ment under this section shall— 

6 (A) provide the Secretary with the authority 

7 to collect any data the Secretary determines nec8 essary to meet the requirements of this part; and 

9 (B) specify the form and manner in which 

10 any such data requested by the Secretary shall be 

11 reported. 

12 (3) RELATIONSHIP TO UNEMPLOYMENT INSUR13 ANCE.—Each agreement under this section shall pro14 vide that an adversely affected worker receiving cli15 mate change adjustment assistance under this part 

16 shall not be eligible for unemployment insurance oth17 erwise payable to such worker under the laws of the 

18 State. 

19 (4) REVIEW.—A determination by a cooperating 

20 State agency with respect to entitlement to program 

21 benefits under an agreement is subject to review in 

22 the same manner and to the same extent as deter23 minations under the applicable State law and only in 

24 that manner and to that extent. 


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1 (5) COORDINATION.—Any agreement entered into 

2 under this section shall provide for the coordination 

3 of the administration of the provisions for employ4 ment services, training, and supplemental assistance 

5 under section 312 and under title I of the Workforce 

6 Investment Act of 1998 (29 U.S.C. 2801 et seq.) upon 

7 such terms and conditions as are established by the 

8 Secretary in consultation with the States and set 

9 forth in such agreement. Any agency of the State 

10 jointly administering such provisions under such 

11 agreement shall be considered to be a cooperating 

12 State agency for purposes of this part. 

13 (6) RESPONSIBILITIES OF COOPERATING AGEN14 CIES.—Each cooperating State agency shall, in car15 rying out paragraph (1)(B)— 

16 (A) advise each worker who applies for un17 employment insurance of the benefits under this 

18 part and the procedures and deadlines for apply19 ing for such benefits; 

20 (B) facilitate the early filing of petitions 

21 under section 311(a) for any workers that the 

22 agency considers are likely to be eligible for bene23 fits under this part; 

24 (C) advise each adversely affected worker to 

25 apply for training under section 312(b) before, 


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1 or at the same time, the worker applies for cli2 mate change adjustment assistance under section 

3 312(a); 

4 (D) perform outreach to, intake of, and ori5 entation for adversely affected workers and ad6 versely affected incumbent workers covered by a 

7 certification under section 312(a) with respect to 

8 assistance and benefits available under this part; 

9 (E) make employment services described in 

10 section 312(b)(1) available to adversely affected 

11 workers and adversely affected incumbent work12 ers covered by a certification under section 

13 311(d) and, if funds provided to carry out this 

14 part are insufficient to make such services avail15 able, make arrangements to make such services 

16 available through other Federal programs; and 

17 (F) provide the benefits and reemployment 

18 services under this part in a manner that is nec19 essary for the proper and efficient administra20 tion of this part, including the use of state agen21 cy personnel employed in accordance with a 

22 merit system of personnel administration stand23 ards, including— 

24 (i) making determinations of eligibility 

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1 justment assistance and health care benefit 

2 replacement amounts; 

3 (ii) developing recommendations re4 garding payments as a bridge to retirement 

5 and lump sum payments to pension plans 

6 in accordance with this subsection; and 

7 (iii) the provision of reemployment 

8 services to eligible workers, including refer9 ral to training services. 

10 (7) SUBMISSION OF CERTAIN INFORMATION.—In 

11 order to promote the coordination of workforce invest12 ment activities in each State with activities carried 

13 out under this part, any agreement entered into 

14 under this section shall provide that the State shall 

15 submit to the Secretary, in such form as the Secretary 

16 may require, the description and information de17 scribed in paragraphs (8) and (14) of section 112(b) 

18 of the Workforce Investment Act of 1998 (29 U.S.C. 

19 2822(b)) and a description of the State’s rapid re20 sponse activities under section 134(a)(2)(A) of that 

21 Act (29 U.S.C. 2864(a)(2)(A)). 

22 (8) CONTROL MEASURES.— 

23 (A) IN GENERAL.—The Secretary shall re24 quire each cooperating State and cooperating 

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1 ures and to effectively oversee the operation and 

2 administration of the climate change adjustment 

3 assistance program under this part, including by 

4 means of monitoring the operation of control 

5 measures to improve the accuracy and timeliness 

6 of the data being collected and reported. 

7 (B) DEFINITION.—For purposes of subpara8 graph (A), the term ‘‘control measures’’ means 

9 measures that— 

10 (i) are internal to a system used by a 

11 State to collect data; and 

12 (ii) are designed to ensure the accuracy 

13 and verifiability of such data. 

14 (9) DATA REPORTING.— 

15 (A) IN GENERAL.—Any agreement entered 

16 into under this section shall require the cooper17 ating State or cooperating State agency to report 

18 to the Secretary on a quarterly basis comprehen19 sive performance accountability data, to consist 

20 of— 

21 (i) the core indicators of performance 

22 described in subparagraph (B)(i); 

23 (ii) the additional indicators of per24 formance described in subparagraph (B)(ii), 

25 if any; and 


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1 (iii) a description of efforts made to 

2 improve outcomes for workers under the cli3 mate change adjustment assistance pro4 gram. 

5 (B) CORE INDICATORS DESCRIBED.— 

6 (i) IN GENERAL.—The core indicators 

7 of performance described in this subpara8 graph are— 

9 (I) the percentage of workers re10 ceiving benefits under this part who 

11 are employed during the second cal12 endar quarter following the calendar 

13 quarter in which the workers cease re14 ceiving such benefits; 

15 (II) the percentage of such workers 

16 who are employed in each of the third 

17 and fourth calendar quarters following 

18 the calendar quarter in which the 

19 workers cease receiving such benefits; 

20 and 

21 (III) the earnings of such workers 

22 in each of the third and fourth cal23 endar quarters following the calendar 

24 quarter in which the workers cease re25 ceiving such benefits. 


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1 (ii) ADDITIONAL INDICATORS.—The 

2 Secretary and a cooperating State or co3 operating State agency may agree upon ad4 ditional indicators of performance for the 

5 climate change adjustment assistance pro6 gram under this part, as appropriate. 

7 (C) STANDARDS WITH RESPECT TO RELI8 ABILITY OF DATA.—In preparing the quarterly 

9 report required by subparagraph (A), each co10 operating State or cooperating State agency 

11 shall establish procedures that are consistent 

12 with guidelines to be issued by the Secretary to 

13 ensure that the data reported are valid and reli14 able. 

15 (10) VERIFICATION OF ELIGIBILITY FOR PRO16 GRAM BENEFITS.— 

17 (A) IN GENERAL.—An agreement under this 

18 section shall provide that the State shall periodi19 cally redetermine that a worker receiving benefits 

20 under this part who is not a citizen or national 

21 of the United States remains in a satisfactory 

22 immigration status. Once satisfactory immigra23 tion status has been initially verified through the 

24 immigration status verification system described 

25 in section 1137(d) of the Social Security Act (42 


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1 U.S.C. 1320b–7(d)) for purposes of establishing a 

2 worker’s eligibility for unemployment compensa3 tion, the State shall reverify the worker’s immi4 gration status if the documentation provided 

5 during initial verification will expire during the 

6 period in which that worker is potentially eligi7 ble to receive benefits under this part. The State 

8 shall conduct such redetermination in a timely 

9 manner, utilizing the immigration status 

10 verification system described in section 1137(d) 

11 of the Social Security Act (42 U.S.C. 1320b– 

12 7(d)). 

13 (B) PROCEDURES.—The Secretary shall es14 tablish procedures to ensure the uniform applica15 tion by the States of the requirements of this 

16 paragraph. 

17 (b) ADMINISTRATION ABSENT STATE AGREEMENT.— 

18 (1) In any State where there is no agreement in 

19 force between a State or its agency under subsection 

20 (a), the Secretary shall promulgate regulations for the 

21 performance of all necessary functions under section 

22 312, including provision for a fair hearing for any 

23 worker whose application for payments is denied. 

24 (2) A final determination under paragraph (1) 

25 with respect to entitlement to program benefits under 


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1 section 312 is subject to review by the courts in the 

2 same manner and to the same extent as is provided 

3 by section 205(g) of the Social Security Act (42 

4 U.S.C. 405(g)). 

5 (c) PROHIBITION ON CONTRACTING WITH PRIVATE

6 ENTITIES.—Neither the Secretary nor a State may contract 

7 with any private for-profit or nonprofit entity for the ad8 ministration of the climate change adjustment assistance 

9 program under this part. 

10 (d) PAYMENT TO THE STATES.— 

11 (1) IN GENERAL.—The Secretary shall from time 

12 to time certify to the Secretary of the Treasury for 

13 payment to each cooperating State the sums necessary 

14 to enable such State as agent of the United States to 

15 make payments provided for by this part. 

16 (2) RESTRICTION.—All money paid a State 

17 under this subsection shall be used solely for the pur18 poses for which it is paid; and money so paid which 

19 is not used for such purposes shall be returned, at the 

20 time specified in the agreement under this section, to 

21 the Secretary of the Treasury. 

22 (3) BONDS.—Any agreement under this section 

23 may require any officer or employee of the State cer24 tifying payments or disbursing funds under the agree25 ment or otherwise participating in the performance of 


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1 the agreement, to give a surety bond to the United 

2 States in such amount as the Secretary may deem 

3 necessary, and may provide for the payment of the 

4 cost of such bond from funds for carrying out the pur5 poses of this part. 

6 (e) LABOR STANDARDS.— 

7 (1) PROHIBITION ON DISPLACEMENT.—An indi8 vidual in an apprenticeship program or on-the-job 

9 training program under this part shall not displace 

10 (including a partial displacement, such as a reduc11 tion in the hours of non-overtime work, wages, or em12 ployment benefits) any employed employee. 

13 (2) PROHIBITION ON IMPAIRMENT OF CON14 TRACTS.—An apprenticeship program or on-the-job 

15 raining program under this Act shall not impair an 

16 existing contract for services or collective bargaining 

17 agreement, and no such activity that would be incon18 sistent with the terms of a collective bargaining agree19 ment shall be undertaken without the written concur20 rence of the labor organization and employer con21 cerned. 

22 (3) ADDITIONAL STANDARDS.—The Secretary, or 

23 a State acting under an agreement described in sub24 section (a) may pay the costs of on-the-job training, 


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1 notwithstanding any other provision of this section, 

2 only if— 

3 (A) in the case of training which would be 

4 inconsistent with the terms of a collective bar5 gaining agreement, the written concurrence of 

6 the labor organization concerned has been ob7 tained; 

8 (B) the job for which such adversely affected 

9 worker is being trained is not being created in 

10 a promotional line that will infringe in any way 

11 upon the promotional opportunities of currently 

12 employed individuals; 

13 (C) such training is not for the same occu14 pation from which the worker was separated and 

15 with respect to which such worker’s group was 

16 certified pursuant to section 311(d); 

17 (D) the employer is provided reimbursement 

18 of not more than 50 percent of the wage rate of 

19 the participant, for the cost of providing the 

20 training and additional supervision related to 

21 the training; and 

22 (E) the employer has not received payment 

23 under with respect to any other on-the-job train24 ing provided by such employer which failed to 


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1 meet the requirements of subparagraphs (A) 

2 through (D). 

3 (f) DEFINITIONS.—As used in this part the following 

4 definitions apply: 

5 (1) The term ‘‘adversely affected employment’’ 

6 means employment at an employment site, if workers 

7 at such site are eligible to apply for adjustment as8 sistance under this part. 

9 (2) The term ‘‘adversely affected worker’’ means 

10 an individual who has been totally or partially sepa11 rated from employment and is eligible to apply for 

12 adjustment assistance under this part. 

(3) The term ‘‘average weekly wage’’ means 1 13 ⁄13

14 of the total wages paid to an individual in the quar15 ter in which the individual’s total wages were highest 

16 among the first 4 of the last 5 completed calendar 

17 quarters immediately before the quarter in which oc18 curs the week with respect to which the computation 

19 is made. Such week shall be the week in which total 

20 separation occurred, or, in cases where partial sepa21 ration is claimed, an appropriate week, as defined in 

22 regulations prescribed by the Secretary. 

23 (4) The term ‘‘average weekly hours’’ means the 

24 average hours worked by the individual (excluding 

25 overtime) in the employment from which he has been 


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1 or claims to have been separated in the 52 weeks (ex2 cluding weeks during which the individual was sick 

3 or on vacation) preceding the week specified in the 

4 last sentence of paragraph (4). 

5 (5) The term ‘‘benefit period’’ means, with re6 spect to an individual— 

7 (A) the benefit year and any ensuing pe8 riod, as determined under applicable State law, 

9 during which the individual is eligible for reg10 ular compensation, additional compensation, or 

11 extended compensation; or 

12 (B) the equivalent to such a benefit year or 

13 ensuing period provided for under the applicable 

14 Federal unemployment insurance law. 

15 (6) The term ‘‘consumer goods manufacturing’’ 

16 means the electrical equipment, appliance, and com17 ponent manufacturing industry and transportation 

18 equipment manufacturing. 

19 (7) The term ‘‘employment site’’ means a single 

20 facility or site of employment. 

21 (8) The term ‘‘energy-intensive manufacturing 

22 industries’’ means all industrial sectors, entities, or 

23 groups of entities that meet the energy or greenhouse 

24 gas intensity criteria in section 763(b)(2)(A) of the 


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1 Clean Air Act based on the most recent data avail2 able. 

3 (9) The term ‘‘energy producing and trans4 forming industries’’ means the coal mining industry, 

5 oil and gas extraction, electricity power generation, 

6 transmission and distribution, and natural gas dis7 tribution. 

8 (10) The term ‘‘industries dependent upon en9 ergy industries’’ means rail transportation and pipe10 line transportation industries. 

11 (11) The term ‘‘on-the-job training’’ means 

12 training provided by an employer to an individual 

13 who is employed by the employer. 

14 (12) The terms ‘‘partial separation’’ and ‘‘par15 tially separated’’ refer, with respect to an individual 

16 who has not been totally separated, that such indi17 vidual has had— 

18 (A) his or her hours of work reduced to 80 

19 percent or less of his average weekly hours in ad20 versely affected employment; and 

21 (B) his or her wages reduced to 80 percent 

22 or less of his average weekly wage in such ad23 versely affected employment. 


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1 (13) The term ‘‘public agency’’ means a depart2 ment or agency of a State or political subdivision of 

3 a State or of the Federal Government. 

4 (14) The term ‘‘Secretary’’ means the Secretary 

5 of Labor. 

6 (15) The term ‘‘service workers’’ means workers 

7 supplying support or auxiliary services to an employ8 ment site. 

9 (16) The term ‘‘State’’ includes the District of 

10 Columbia and the Commonwealth of Puerto Rico: and 

11 the term ‘‘United States’’ when used in the geo12 graphical sense includes such Commonwealth. 

13 (17) The term ‘‘State agency’’ means the agency 

14 of the State which administers the State law. 

15 (18) The term ‘‘State law’’ means the unemploy16 ment insurance law of the State approved by the Sec17 retary of Labor under section 3304 of the Internal 

18 Revenue Code of 1986. 

19 (19) The terms ‘‘total separation’’ and ‘‘totally 

20 separated’’ refer to the layoff or severance of an indi21 vidual from employment with an employer in which 

22 adversely affected employment exists. 

23 (20) The term ‘‘unemployment insurance’’ means 

24 the unemployment compensation payable to an indi25 vidual under any State law or Federal unemployment 


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1 compensation law, including chapter 85 of title 5, 

2 United States Code, and the Railroad Unemployment 

3 Insurance Act (45 U.S.C. 351 et seq.). The terms 

4 ‘‘regular compensation’’, ‘‘additional compensation’’, 

5 and ‘‘extended compensation’’ have the same respec6 tive meanings that are given them in section 205(2), 

7 (3), and (4) of the Federal-State Extended Unemploy8 ment Compensation Act of 1970 (26 U.S.C. 3304 

9 note; Public Law 91–373). 

10 (21) The term ‘‘week’’ means a week as defined 

11 in the applicable State law. 

12 (22) The term ‘‘week of unemployment’’ means a 

13 week of total, part-total, or partial unemployment as 

14 determined under the applicable State law or Federal 

15 unemployment insurance law. 

16 (g) SPECIAL RULE WITH RESPECT TO MILITARY

17 SERVICE.— 

18 (1) IN GENERAL.—Notwithstanding any other 

19 provision of this part, the Secretary may waive any 

20 requirement of this part that the Secretary determines 

21 is necessary to ensure that an adversely affected work22 er who is a member of a reserve component of the 

23 Armed Forces and serves a period of duty described 

24 in paragraph (2) is eligible to receive climate change 

25 adjustment assistance, training, and other benefits 


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1 under this part in the same manner and to the same 

2 extent as if the worker had not served the period of 

3 duty. 

4 (2) PERIOD OF DUTY DESCRIBED.—An adversely 

5 affected worker serves a period of duty described in 

6 this paragraph if, before completing training under 

7 this part, the worker— 

8 (A) serves on active duty for a period of 

9 more than 30 days under a call or order to ac10 tive duty of more than 30 days; or 

11 (B) in the case of a member of the Army 

12 National Guard of the United States or Air Na13 tional Guard of the United States, performs full14 time National Guard duty under section 502(f) 

15 of title 32, United States Code, for 30 consecutive 

16 days or more when authorized by the President 

17 or the Secretary of Defense for the purpose of re18 sponding to a national emergency declared by 

19 the President and supported by Federal funds. 

20 (h) FRAUD AND RECOVERY OF OVERPAYMENTS.— 

21 (1) RECOVERY OF PAYMENTS TO WHICH AN INDI22 VIDUAL WAS NOT ENTITLED.—If the Secretary or a 

23 court of competent jurisdiction determines that any 

24 person has received any payment under this part to 

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1 vidual shall be liable to repay such amount to the 

2 Secretary, as the case may be, except that the Sec3 retary shall waive such repayment if such agency or 

4 the Secretary determines that— 

5 (A) the payment was made without fault on 

6 the part of such individual; and 

7 (B) requiring such repayment would cause 

8 a financial hardship for the individual (or the 

9 individual’s household, if applicable) when tak10 ing into consideration the income and resources 

11 reasonably available to the individual (or house12 hold) and other ordinary living expenses of the 

13 individual (or household). 

14 (2) MEANS OF RECOVERY.—Unless an overpay15 ment is otherwise recovered, or waived under para16 graph (1), the Secretary shall recover the overpay17 ment by deductions from any sums payable to such 

18 person under this part, under any Federal unemploy19 ment compensation law or other Federal law admin20 istered by the Secretary which provides for the pay21 ment of assistance with respect to unemployment. 

22 Any amount recovered under this section shall be re23 turned to the Treasury of the United States. 

24 (3) PENALTIES FOR FRAUD.—Any person who— 


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1 (A) makes a false statement of a material 

2 fact knowing it to be false, or knowingly fails to 

3 disclose a material fact, for the purpose of ob4 taining or increasing for that person or for any 

5 other person any payment authorized to be fur6 nished under this part; or 

7 (B) makes a false statement of a material 

8 fact knowing it to be false, or knowingly fails to 

9 disclose a material fact, when providing infor10 mation to the Secretary during an investigation 

11 of a petition under section 311(c); 

12 shall be imprisoned for not more than one year, or fined 

13 under title 18, United States Code, or both, and be ineligible 

14 for any further payments under this part. 

15 (i) REGULATIONS.—The Secretary shall prescribe such 

16 regulations as may be necessary to carry out the provisions 

17 of this part. 

18 (j) STUDY ON OLDER WORKERS.—The Secretary shall 

19 conduct a study examine the circumstances of older ad20 versely affected workers and the ability of such workers to 

21 access their retirement benefits. The Secretary shall trans22 mit a report to Congress not later than 2 years after the 

23 date of enactment of this Act on the findings of the study 

24 and the Secretary’s recommendations on how to ensure that 


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1 adversely affected workers within 2 years of retirement are 

2 able to access their retirement benefits. 

3 (k) SPENDING LIMIT.— 

4 (1) IN GENERAL.—For each fiscal year, the total 

5 amount of funds disbursed for the purposes described 

6 in section 312 shall not exceed the amount deposited 

7 in that fiscal year into the Worker Transition Fund 

8 established under section 209 of division B. 

9 (2) SUBSEQUENT FISCAL YEARS.—The annual 

10 spending limit for any succeeding fiscal year shall be 

11 increased by the difference, if any, between the 

12 amount of the disbursements for the prior fiscal year 

13 and the spending limitation for that fiscal year. 

14 (3) ADMINISTRATION.— 

15 (A) IN GENERAL.—The Secretary shall pro16 mulgate rules to ensure that the spending limit 

17 established under this subsection is not exceeded. 

18 (B) RULES.—The rules shall— 

19 (i) provide that workers who receive 

20 any of the benefits described in section 312 

21 receive full benefits; and 

22 (ii) include the establishment of a 

23 waiting list for workers in the event that the 

24 requests for assistance exceed the spending 

25 limit. 


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1 Subtitle B—International Climate 

2 Change Programs 

3 SEC. 321. STRATEGIC INTERAGENCY BOARD ON INTER4 NATIONAL CLIMATE INVESTMENT. 

5 (a) ESTABLISHMENT.— 

6 (1) IN GENERAL.—Not later than 90 days after 

7 the date of the enactment of this Act, the President 

8 shall establish the ‘‘Strategic Interagency Board on 

9 International Climate Investment’’ (referred to in this 

10 subtitle as the ‘‘Board’’). 

11 (2) COMPOSITION.—The Board shall be composed 

12 of— 

13 (A) the Secretary of State; 

14 (B) the Administrator of United States 

15 Agency for International Development; 

16 (C) the Secretary of Energy; 

17 (D) the Secretary of the Treasury; 

18 (E) the Secretary of Commerce; 

19 (F) the Secretary of Agriculture; 

20 (G) the Administrator; and 

21 (H) such other relevant officials as the 

22 President may designate. 

23 (b) DUTIES.—The duties of the Board shall include as24 sessing, monitoring, and evaluating the progress and con25 tributions of relevant departments and agencies of the FedVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01156 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 eral Government in supporting financing for international 

2 climate change activities. 

3 SEC. 322. EMISSION REDUCTIONS FROM REDUCED DEFOR4 ESTATION. 

5 Title VII of the Clean Air Act (as amended by section 

6 101 of division B) is amended by adding at the end the 

7 following: 

8 ‘‘PART E—SUPPLEMENTAL EMISSION 

9 REDUCTIONS 

10 ‘‘SEC. 751. DEFINITIONS. 

11 ‘‘In this part: 

12 ‘‘(1) ADMINISTRATOR.—The term ‘Adminis13 trator’ means the Administrator of the United States 

14 Agency for International Development. 

15 ‘‘(2) DEFORESTATION.—The term ‘deforestation’ 

16 means a change in land use from a forest to any other 

17 land use. 

18 ‘‘(3) DEGRADATION.—The term ‘degradation’, 

19 with respect to a forest, is any reduction in the car20 bon stock of a forest due to the impact of human land21 use activities. 

22 ‘‘(4) EMISSION REDUCTIONS.—The term ‘emis23 sion reductions’ means greenhouse gas emission reduc24 tions achieved from reduced or avoided deforestation 

25 under this title. 


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1 ‘‘(5) LEAKAGE PREVENTION ACTIVITIES.—The 

2 term ‘leakage prevention activities’ means activities 

3 in developing countries that are directed at preserving 

4 existing forest carbon stocks, including forested wet5 lands and peatlands, that might, absent such activi6 ties, be lost through leakage. 

7 ‘‘SEC. 752. PURPOSES. 

8 ‘‘The purposes of this part are to provide United States 

9 assistance to developing countries— 

10 ‘‘(1) to develop, implement and improve nation11 ally appropriate greenhouse gas mitigation policies 

12 and actions that reduce deforestation and forest deg13 radation or conserve or restore forest ecosystems, in a 

14 measurable, reportable, and verifiable manner; and 

15 ‘‘(2) in a manner that is consistent with and en16 hances the implementation of complementary United 

17 States policies that support the good governance of 

18 forests, biodiversity conservation, and environ19 mentally sustainable development, while taking local 

20 communities, most vulnerable populations and com21 munities, particularly forest-dependent communities 

22 and indigenous peoples into consideration. 


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1 ‘‘SEC. 753. EMISSION REDUCTIONS FROM REDUCED DEFOR2 ESTATION. 

3 ‘‘(a) IN GENERAL.—Not later than 2 years after the 

4 date of the enactment of this part, the Administrator, in 

5 consultation with the Administrator of the Environmental 

6 Protection Agency, the Secretary of Agriculture, and the 

7 head of any other appropriate agency, shall establish a pro8 gram to provide assistance to reduce greenhouse gas emis9 sions from deforestation in developing countries, in accord10 ance with this title. 

11 ‘‘(b) OBJECTIVES.—The objectives of the program es12 tablished under this section shall be— 

13 ‘‘(1) to reduce greenhouse gas emissions from de14 forestation in developing countries by at least 

15 720,000,000 tons of carbon dioxide equivalent in 

16 2020, and a cumulative quantity of at least 

17 6,000,000,000 tons of carbon dioxide equivalent by 

18 December 31, 2025, with additional reductions in 

19 subsequent years; 

20 ‘‘(2) to assist developing countries in preparing 

21 to participate in international markets for inter22 national offset credits for reduced emissions from de23 forestation; and 

24 ‘‘(3) to preserve existing forest carbon stocks in 

25 countries where such forest carbon may be vulnerable 

26 to international leakage. 


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1 ‘‘(c) NOT ELIGIBLE FOR OFFSET CREDIT.—Activities 

2 that receive support under this part shall not be issued offset 

3 credits for the greenhouse gas emissions reductions or avoid4 ance, or greenhouse gas sequestration, produced by such ac5 tivities.’’. 

6 SEC. 323. INTERNATIONAL CLEAN ENERGY DEPLOYMENT 

7 PROGRAM. 

8 (a) PURPOSES.—The purposes of this section are— 

9 (1) to assist developing countries in activities 

10 that reduce, sequester, or avoid greenhouse gas emis11 sions; 

12 (2) to encourage those countries to shift toward 

13 low-carbon development, and promote a successful 

14 global agreement under the United Nations Frame15 work Convention on Climate Change, done at New 

16 York on May 9, 1992 (or a successor agreement) (re17 ferred to in this subtitle as the ‘‘Convention’’); and 

18 (3) to promote robust compliance with and en19 forcement of existing international legal requirements 

20 for the protection of intellectual property rights. 

21 (b) ESTABLISHMENT OF INTERNATIONAL CLEAN EN22 ERGY DEPLOYMENT PROGRAM.— 

23 (1) ESTABLISHMENT.—The Secretary of State, 

24 in consultation with an interagency group designated 

25 by the President, shall establish an International 


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1 Clean Energy Deployment Program in accordance 

2 with this section. 

3 (2) DISTRIBUTION OF ASSISTANCE.—The Sec4 retary of State, or the head of such other Federal 

5 agency as the President may designate, shall direct 

6 the distribution of funding to carry out the Clean En7 ergy Technology Program— 

8 (A) in the form of bilateral assistance; 

9 (B) to multilateral funds or international 

10 institutions pursuant to the Convention or an 

11 agreement negotiated under the Convention; or 

12 (C) through a combination of the mecha13 nisms identified under subparagraphs (A) and 

14 (B). 

15 (c) DETERMINATION OF QUALIFYING ACTIVITIES.—As16 sistance under this subtitle may be provided only to quali17 fying entities for clean technology activities (including 

18 building relevant technical and institutional capacity) that 

19 contribute to substantial, measurable, reportable, and 

20 verifiable reductions, sequestration, or avoidance of green21 house gas emissions. 

22 SEC. 324. INTERNATIONAL CLIMATE CHANGE ADAPTATION 

23 AND GLOBAL SECURITY PROGRAM. 

24 (a) PURPOSES.—The purposes of this section are— 


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1 (1) to provide assistance to the most vulnerable 

2 developing countries, particularly to the most vulner3 able communities and populations in those countries; 

4 and 

5 (2) to support the development and implementa6 tion of climate change adaptation programs in a way 

7 that protects and promotes interests of the United 

8 States, to the extent those interests may be advanced 

9 by minimizing, averting, or increasing resilience to 

10 climate change impacts. 

11 (b) INTERNATIONAL CLIMATE CHANGE ADAPTATION

12 AND GLOBAL SECURITY PROGRAM.— 

13 (1) ESTABLISHMENT.—The Secretary of State, 

14 in consultation with the Administrator of the United 

15 States Agency for International Development, the Sec16 retary of the Treasury, and the Administrator, shall 

17 establish an International Climate Change Adapta18 tion and Global Security Program in accordance with 

19 this section. 

20 (2) DISTRIBUTION OF ASSISTANCE.—The Sec21 retary of State, or the head of such other Federal 

22 agency as the President may designate, after consulta23 tion with the Secretary of the Treasury, the Adminis24 trator of the United States Agency for International 

25 Development, and the Administrator, shall direct the 


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1 distribution of funding to carry out the International 

2 Climate Change Adaptation and Global Security Pro3 gram— 

4 (A) in the form of bilateral assistance; 

5 (B) to multilateral funds or international 

6 institutions pursuant to the Convention or an 

7 agreement negotiated under the Convention; or 

8 (C) through a combination of the mecha9 nisms identified under subparagraphs (A) and 

10 (B). 

11 SEC. 325. EVALUATION AND REPORTS. 

12 (a) MONITORING, EVALUATION, AND ENFORCEMENT.— 

13 The Board shall establish and implement a system to mon14 itor and evaluate the effectiveness and efficiency of assist15 ance provided under this subtitle by including evaluation 

16 criteria, such as performance indicators. 

17 (b) REPORTS AND REVIEW.— 

18 (1) ANNUAL REPORT.—Not later than 1 year 

19 after the date of enactment of this Act, and annually 

20 thereafter, the Board shall submit to the appropriate 

21 committees of Congress a report that describes— 

22 (A) the steps Federal agencies have taken, 

23 and the progress made, toward accomplishing the 

24 objectives of this section; and 


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1 (B) the ramifications of any potentially de2 stabilizing impacts climate change may have on 

3 the interests of the United States. 

4 (2) REVIEWS.—Not later than 3 years after the 

5 date of enactment of this Act, and triennially there6 after, the Board, in cooperation with the National 

7 Academy of Sciences and other appropriate research 

8 and development institutions, shall— 

9 (A) review the global needs and opportuni10 ties for climate change investment in developing 

11 countries; and 

12 (B) submit to Congress a report that de13 scribes the findings of the review. 

14 SEC. 326. REPORT ON CLIMATE ACTIONS OF MAJOR ECONO15 MIES. 

16 (a) IN GENERAL.—The Secretary of State, in coopera17 tion with the Board, shall prepare an interagency report 

18 on climate change and energy policy of the 5 countries that, 

19 of the countries that are not members of the Organisation 

20 for Economic Co-Operation and Development, emit the 

21 greatest annual quantity of greenhouse gases. 

22 (b) PURPOSES.—The purposes of the report shall be— 

23 (1) to provide to Congress and the public of the 

24 United States— 


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1 (A) a better understanding of the actions 

2 the countries described in subsection (a) are tak3 ing to reduce greenhouse gas emissions; and 

4 (B) an assessment of the climate change and 

5 energy policy commitments and actions of those 

6 countries; and 

7 (2) to identify the means by which the United 

8 States can assist those countries in achieving such a 

9 reduction. 

10 (c) SUBMISSION TO CONGRESS.—Not later than 15 

11 months after the date of enactment of this Act, the Secretary 

12 of State shall submit to the appropriate committees of Con13 gress the report prepared under this section. 

14 Subtitle C—Adapting to Climate 

15 Change 

16 PART 1—DOMESTIC ADAPTATION 

17 Subpart A—National Climate Change Adaptation 

18 Program 

19 SEC. 341. NATIONAL CLIMATE CHANGE ADAPTATION PRO20 GRAM. 

21 The President shall establish within the United States 

22 Global Change Research Program a National Climate 

23 Change Adaptation Program for the purpose of increasing 

24 the overall effectiveness of Federal climate change adapta25 tion efforts. 


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1 SEC. 342. CLIMATE SERVICES. 

2 The Secretary of Commerce, acting through the Ad3 ministrator of the National Oceanic and Atmospheric Ad4 ministration (NOAA), shall establish within NOAA a Na5 tional Climate Service to develop climate information, data, 

6 forecasts, and warnings at national and regional scales, 

7 and to distribute information related to climate impacts to 

8 State, local, and tribal governments and the public to facili9 tate the development and implementation of strategies to 

10 reduce society’s vulnerability to climate variability and 

11 change. 

12 Subpart B—Public Health and Climate Change 

13 SEC. 351. SENSE OF CONGRESS ON PUBLIC HEALTH AND 

14 CLIMATE CHANGE. 

15 It is the sense of the Congress that the Federal Govern16 ment, in cooperation with international, State, and local 

17 governments, Indian tribes, concerned public and private 

18 organizations, and citizens, should use all practicable 

19 means and measures— 

20 (1) to assist the efforts of public health and 

21 health care professionals, first responders, States, In22 dian tribes, municipalities, and local communities to 

23 incorporate measures to prepare health systems to re24 spond to the impacts of climate change; 

25 (2) to ensure— 


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1 (A) that the Nation’s health professionals 

2 have sufficient information to prepare for and 

3 respond to the adverse health impacts of climate 

4 change; 

5 (B) the utility and value of scientific re6 search in advancing understanding of— 

7 (i) the health impacts of climate 

8 change; and 

9 (ii) strategies to prepare for and re10 spond to the health impacts of climate 

11 change; 

12 (C) the identification of communities vul13 nerable to the health effects of climate change 

14 and the development of strategic response plans 

15 to be carried out by health professionals for those 

16 communities; 

17 (D) the improvement of health status and 

18 health equity through efforts to prepare for and 

19 respond to climate change; and 

20 (E) the inclusion of health policy in the de21 velopment of climate change responses; 

22 (3) to encourage further research, interdiscipli23 nary partnership, and collaboration among stake24 holders in order to— 


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1 (A) understand and monitor the health im2 pacts of climate change; and 

3 (B) improve public health knowledge and 

4 response strategies to climate change; 

5 (4) to enhance preparedness activities, and pub6 lic health infrastructure, relating to climate change 

7 and health; 

8 (5) to encourage each and every American to 

9 learn about the impacts of climate change on health; 

10 and 

11 (6) to assist the efforts of developing nations to 

12 incorporate measures to prepare health systems to re13 spond to the impacts of climate change. 

14 SEC. 352. RELATIONSHIP TO OTHER LAWS. 

15 Nothing in this subpart in any manner limits the au16 thority provided to or responsibility conferred on any Fed17 eral department or agency by any provision of any law (in18 cluding regulations) or authorizes any violation of any pro19 vision of any law (including regulations), including any 

20 health, energy, environmental, transportation, or any other 

21 law or regulation. 

22 SEC. 353. NATIONAL STRATEGIC ACTION PLAN. 

23 (a) REQUIREMENT.— 

24 (1) IN GENERAL.—The Secretary of Health and 

25 Human Services, within 2 years after the date of the 


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1 enactment of this Act, on the basis of the best avail2 able science, and in consultation pursuant to para3 graph (2), shall publish a strategic action plan to as4 sist health professionals in preparing for and re5 sponding to the impacts of climate change on public 

6 health in the United States and other nations, par7 ticularly developing nations. 

8 (2) CONSULTATION.—In developing or making 

9 any revision to the national strategic action plan, the 

10 Secretary shall— 

11 (A) consult with the Director of the Centers 

12 for Disease Control and Prevention, the Admin13 istrator of the Environmental Protection Agency, 

14 the Director of the National Institutes of Health, 

15 the Director of the Indian Health Service, the 

16 Secretary of Energy, other appropriate Federal 

17 agencies, Indian tribes, State and local govern18 ments, public health organizations, scientists, 

19 and other interested stakeholders; and 

20 (B) provide opportunity for public input. 

21 (b) CONTENTS.— 

22 (1) IN GENERAL.—The Secretary shall assist 

23 health professionals in preparing for and responding 

24 effectively and efficiently to the health effects of cli25 mate change through measures including— 


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1 (A) developing, improving, integrating, and 

2 maintaining domestic and international disease 

3 surveillance systems and monitoring capacity to 

4 respond to health-related effects of climate 

5 change, including on topics addressing— 

6 (i) water, food, and vector borne infec7 tious diseases and climate change; 

8 (ii) pulmonary effects, including re9 sponses to aeroallergens; 

10 (iii) cardiovascular effects, including 

11 impacts of temperature extremes; 

12 (iv) air pollution health effects, includ13 ing heightened sensitivity to air pollution; 

14 (v) hazardous algal blooms; 

15 (vi) mental and behavioral health im16 pacts of climate change; 

17 (vii) the health of refugees, displaced 

18 persons, and vulnerable communities; 

19 (viii) the implications for communities 

20 vulnerable to health effects of climate 

21 change, as well as strategies for responding 

22 to climate change within these communities; 

23 and 


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1 (ix) local and community-based health 

2 interventions for climate-related health im3 pacts; 

4 (B) creating tools for predicting and moni5 toring the public health effects of climate change 

6 on the international, national, regional, State, 

7 tribal, and local levels, and providing technical 

8 support to assist in their implementation; 

9 (C) developing public health communica10 tions strategies and interventions for extreme 

11 weather events and disaster response situations; 

12 (D) identifying and prioritizing commu13 nities and populations vulnerable to the health 

14 effects of climate change, and determining ac15 tions and communication strategies that should 

16 be taken to inform and protect these communities 

17 and populations from the health effects of climate 

18 change; 

19 (E) developing health communication, pub20 lic education, and outreach programs aimed at 

21 public health and health care professionals, as 

22 well as the general public, to promote prepared23 ness and response strategies relating to climate 

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1 fication of greenhouse gas reduction behaviors 

2 that are health-promoting; and 

3 (F) developing academic and regional cen4 ters of excellence devoted to— 

5 (i) researching relationships between 

6 climate change and health; 

7 (ii) expanding and training the public 

8 health workforce to strengthen the capacity 

9 of such workforce to respond to and prepare 

10 for the health effects of climate change; 

11 (iii) creating and supporting academic 

12 fellowships focusing on the health effects of 

13 climate change; and 

14 (iv) training senior health ministry of15 ficials from developing nations to strengthen 

16 the capacity of such nations to— 

17 (I) prepare for and respond to the 

18 health effects of climate change; and 

19 (II) build an international net20 work of public health professionals 

21 with the necessary climate change 

22 knowledge base; 

23 (G) using techniques, including health im24 pact assessments, to assess various climate 

25 change public health preparedness and response 


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1 strategies on international, national, State, re2 gional, tribal, and local levels, and make rec3 ommendations as to those strategies that best 

4 protect the public health; 

5 (H)(i) assisting in the development, imple6 mentation, and support of State, regional, tribal, 

7 and local preparedness, communication, and re8 sponse plans (including with respect to the 

9 health departments of such entities) to anticipate 

10 and reduce the health threats of climate change; 

11 and 

12 (ii) pursuing collaborative efforts to develop, 

13 integrate, and implement such plans; 

14 (I) creating a program to advance research 

15 as it relates to the effects of climate change on 

16 public health across Federal agencies, including 

17 research to— 

18 (i) identify and assess climate change 

19 health effects preparedness and response 

20 strategies; 

21 (ii) prioritize critical public health in22 frastructure projects related to potential cli23 mate change impacts that affect public 

24 health; and 


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1 (iii) coordinate preparedness for cli2 mate change health impacts, including the 

3 development of modeling and forecasting 

4 tools; 

5 (J) providing technical assistance for the 

6 development, implementation, and support of 

7 preparedness and response plans to anticipate 

8 and reduce the health threats of climate change 

9 in developing nations; and 

10 (K) carrying out other activities determined 

11 appropriate by the Secretary to plan for and re12 spond to the impacts of climate change on public 

13 health. 

14 (c) REVISION.—The Secretary shall revise the national 

15 strategic action plan not later than July 1, 2014, and every 

16 4 years thereafter, to reflect new information collected pur17 suant to implementation of the national strategic action 

18 plan and otherwise, including information on— 

19 (1) the status of critical environmental health 

20 parameters and related human health impacts; 

21 (2) the impacts of climate change on public 

22 health; and 

23 (3) advances in the development of strategies for 

24 preparing for and responding to the impacts of cli25 mate change on public health. 


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1 (d) IMPLEMENTATION.— 

2 (1) IMPLEMENTATION THROUGH HHS.—The Sec3 retary shall exercise the Secretary’s authority under 

4 this subpart and other provisions of Federal law to 

5 achieve the goals and measures of the national stra6 tegic action plan. 

7 (2) OTHER PUBLIC HEALTH PROGRAMS AND INI8 TIATIVES.—The Secretary and Federal officials of 

9 other relevant Federal agencies shall administer pub10 lic health programs and initiatives authorized by pro11 visions of law other than this subpart, subject to the 

12 requirements of such statutes, in a manner designed 

13 to achieve the goals of the national strategic action 

14 plan. 

15 (3) SPECIFIC ACTIVITIES.—In furtherance of the 

16 national strategic action plan, the Secretary shall— 

17 (A) conduct scientific research to assist 

18 health professionals in preparing for and re19 sponding to the impacts of climate change on 

20 public health; and 

21 (B) provide funding for— 

22 (i) research on the health effects of cli23 mate change; and 

24 (ii) preparedness planning on the 

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1 gional, and local levels to respond to or re2 duce the burden of health effects of climate 

3 change; and 

4 (C) carry out other activities determined 

5 appropriate by the Secretary to prepare for and 

6 respond to the impacts of climate change on pub7 lic health. 

8 SEC. 354. ADVISORY BOARD. 

9 (a) ESTABLISHMENT.—The Secretary shall establish a 

10 permanent science advisory board comprised of not less 

11 than 10 and not more than 20 members. 

12 (b) APPOINTMENT OF MEMBERS.—The Secretary shall 

13 appoint the members of the science advisory board from 

14 among individuals— 

15 (1) who have expertise in public health and 

16 human services, climate change, and other relevant 

17 disciplines; and 

(2) at least 1 18 ⁄2 of whom are recommended by the 

19 President of the National Academy of Sciences. 

20 (c) FUNCTIONS.—The science advisory board shall— 

21 (1) provide scientific and technical advice and 

22 recommendations to the Secretary on the domestic 

23 and international impacts of climate change on pub24 lic health, populations and regions particularly vul25 nerable to the effects of climate change, and strategies 


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1 and mechanisms to prepare for and respond to the 

2 impacts of climate change on public health; and 

3 (2) advise the Secretary regarding the best 

4 science available for purposes of issuing the national 

5 strategic action plan. 

6 SEC. 355. REPORTS. 

7 (a) NEEDS ASSESSMENT.— 

8 (1) IN GENERAL.—The Secretary shall seek to 

9 enter into, by not later than 6 months after the date 

10 of the enactment of this Act, an agreement with the 

11 National Research Council and the Institute of Medi12 cine to complete a report that— 

13 (A) assesses the needs for health profes14 sionals to prepare for and respond to climate 

15 change impacts on public health; and 

16 (B) recommends programs to meet those 

17 needs. 

18 (2) SUBMISSION.—The agreement under para19 graph (1) shall require the completed report to be sub20 mitted to the Congress and the Secretary and made 

21 publicly available not later than 1 year after the date 

22 of the agreement. 

23 (b) CLIMATE CHANGE HEALTH PROTECTION AND PRO24 MOTION REPORTS.— 


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1 (1) IN GENERAL.—The Secretary, in consultation 

2 with the advisory board established under section 354, 

3 shall ensure the issuance of reports to aid health pro4 fessionals in preparing for and responding to the ad5 verse health effects of climate change that— 

6 (A) review scientific developments on health 

7 impacts of climate change; and 

8 (B) recommend changes to the national 

9 strategic action plan. 

10 (2) SUBMISSION.—The Secretary shall submit 

11 the reports required by paragraph (1) to the Congress 

12 and make such reports publicly available not later 

13 than July 1, 2013, and every 4 years thereafter. 

14 SEC. 356. DEFINITIONS. 

15 In this subpart: 

16 (1) HEALTH IMPACT ASSESSMENT.—The term 

17 ‘‘health impact assessment’’ means a combination of 

18 procedures, methods, and tools by which a policy, pro19 gram, or project may be judged as to its potential ef20 fects on the health of a population, and the distribu21 tion of those effects within the population. 

22 (2) NATIONAL STRATEGIC ACTION PLAN.—The 

23 term ‘‘national strategic action plan’’ means the plan 

24 issued and revised under section 353. 


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1 (3) SECRETARY.—Unless otherwise specified, the 

2 term ‘‘Secretary’’ means the Secretary of Health and 

3 Human Services. 

4 Subpart C—Climate Change Safeguards for Natural 

5 Resources Conservation 

6 SEC. 361. PURPOSES. 

7 The purposes of this subpart are— 

8 (1) to establish an integrated Federal program 

9 that responds to ongoing and expected impacts of cli10 mate change, including, where applicable, ocean 

11 acidification, drought, flooding, and wildfire, by pro12 tecting, restoring, and conserving the natural re13 sources of the United States; and 

14 (2) to provide financial support and incentives 

15 for programs, strategies, and activities that respond 

16 to threats of climate change, including, where appli17 cable, ocean acidification, drought, flooding, and 

18 wildfire, by protecting, restoring, and conserving the 

19 natural resources of the United States. 

20 SEC. 362. NATURAL RESOURCES CLIMATE CHANGE ADAPTA21 TION POLICY. 

22 It is the policy of the Federal Government, in coopera23 tion with State and local governments, Indian tribes, and 

24 other interested stakeholders, to use all practicable means 

25 to protect, restore, and conserve natural resources so that 


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1 natural resources become more resilient, adapt to, and with2 stand the ongoing and expected impacts of climate change, 

3 including, where applicable, ocean acidification, drought, 

4 flooding, and wildfire. 

5 SEC. 363. DEFINITIONS. 

6 In this subpart: 

7 (1) ACCOUNT.—The term ‘‘Account’’ means the 

8 Natural Resources Climate Change Adaption Account 

9 established by section 370(a). 

10 (2) ADMINISTRATORS.—The term ‘‘Administra11 tors’’ means— 

12 (A) the Administrator of the National Oce13 anic and Atmospheric Administration; and 

14 (B) the Director of the United States Geo15 logical Survey. 

16 (3) BOARD.—The term ‘‘Board’’ means the 

17 Science Advisory Board established by section 

18 367(f)(1). 

19 (4) CENTER.—The term ‘‘Center’’ means the Na20 tional Climate Change and Wildlife Science Center 

21 described by section 367(e)(1). 

22 (5) COASTAL STATE.—The term ‘‘coastal State’’ 

23 has the meaning given the term ‘‘coastal state’’ in sec24 tion 304 of the Coastal Zone Management Act of 1972 

25 (16 U.S.C. 1453). 


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1 (6) CORRIDORS.—The term ‘‘corridors’’ means 

2 areas that— 

3 (A) provide connectivity, over different time 

4 scales, of habitats or potential habitats; and 

5 (B) facilitate terrestrial, marine, estuarine, 

6 and freshwater fish, wildlife, or plant movement 

7 necessary for migration, gene flow, or dispersal, 

8 or to respond to the ongoing and expected im9 pacts of climate change, including, where appli10 cable, ocean acidification, drought, flooding, and 

11 wildfire. 

12 (7) ECOLOGICAL PROCESSES.—The term ‘‘eco13 logical processes’’ means biological, chemical, or phys14 ical interaction between the biotic and abiotic compo15 nents of an ecosystem, including— 

16 (A) nutrient cycling; 

17 (B) pollination; 

18 (C) predator-prey relationships; 

19 (D) soil formation; 

20 (E) gene flow; 

21 (F) disease epizootiology; 

22 (G) larval dispersal and settlement; 

23 (H) hydrological cycling; 

24 (I) decomposition; and 


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1 (J) disturbance regimes, such as fire and 

2 flooding. 

3 (8) HABITAT.—The term ‘‘habitat’’ means the 

4 physical, chemical, and biological properties that fish, 

5 wildlife, or plants use for growth, reproduction, sur6 vival, food, water, or cover (whether on land, in 

7 water, or in an area or region). 

8 (9) INDIAN TRIBE.—The term ‘‘Indian tribe’’ has 

9 the meaning given the term in section 4 of the Indian 

10 Self-Determination and Education Assistance Act (25 

11 U.S.C. 450b). 

12 (10) NATURAL RESOURCES.—The term ‘‘natural 

13 resources’’ means fish, wildlife, plants, habitats, and 

14 terrestrial, freshwater, estuarine, and marine eco15 systems of the United States. 

16 (11) NATURAL RESOURCES ADAPTATION.—The 

17 term ‘‘natural resources adaptation’’ means the pro18 tection, restoration, and conservation of natural re19 sources so that natural resources become more resil20 ient, adapt to, and withstand the ongoing and ex21 pected impacts of climate change, including, where 

22 applicable, ocean acidification, drought, flooding, and 

23 wildfire. 


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1 (12) PANEL.—The term ‘‘Panel’’ means the Nat2 ural Resources Climate Change Adaptation Panel es3 tablished under section 365(a). 

4 (13) RESILIENCE; RESILIENT.—The terms ‘‘resil5 ience’’ and ‘‘resilient’’ mean— 

6 (A) the ability to resist or recover from dis7 turbance; and 

8 (B) the ability to preserve diversity, produc9 tivity, and sustainability. 

10 (14) STATE.—The term ‘‘State’’ means— 

11 (A) a State of the United States; 

12 (B) the District of Columbia; 

13 (C) American Samoa; 

14 (D) Guam; 

15 (E) the Commonwealth of the Northern 

16 Mariana Islands; 

17 (F) the Commonwealth of Puerto Rico; and 

18 (G) the United States Virgin Islands. 

19 (15) STRATEGY.—The term ‘‘Strategy’’ means 

20 the Natural Resources Climate Change Adaptation 

21 Strategy developed under section 366(a). 

22 SEC. 364. COUNCIL ON ENVIRONMENTAL QUALITY. 

23 The Chair of the Council on Environmental Quality 

24 shall— 


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1 (1) advise the President on implementing and 

2 developing— 

3 (A) the Strategy; and 

4 (B) the Federal natural resource agency ad5 aptation plans required by section 368; 

6 (2) serve as the Chair of the Panel established 

7 under section 365; and 

8 (3) coordinate Federal agency strategies, plans, 

9 programs, and activities relating to protecting, restor10 ing, and maintaining natural resources so that nat11 ural resources become more resilient, adapt to, and 

12 withstand the ongoing and expected impacts of cli13 mate change. 

14 SEC. 365. NATURAL RESOURCES CLIMATE CHANGE ADAPTA15 TION PANEL. 

16 (a) ESTABLISHMENT.—Not later than 90 days after 

17 the date of enactment of this Act, the President shall estab18 lish a Natural Resources Climate Change Adaptation 

19 Panel. 

20 (b) DUTIES.—The Panel shall serve as a forum for 

21 interagency consultation on, and the coordination of, the 

22 development and implementation of the Strategy. 

23 (c) MEMBERSHIP.—The Panel shall be composed of— 

24 (1) the Administrator of the National Oceanic 

25 and Atmospheric Administration (or a designee); 


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1 (2) the Chief of the Forest Service (or a des2 ignee); 

3 (3) the Director of the National Park Service (or 

4 a designee); 

5 (4) the Director of the United States Fish and 

6 Wildlife Service (or a designee); 

7 (5) the Director of the Bureau of Land Manage8 ment (or a designee); 

9 (6) the Director of the United States Geological 

10 Survey (or a designee); 

11 (7) the Commissioner of Reclamation (or a des12 ignee); and 

13 (8) the Director of the Bureau of Indian Affairs 

14 (or a designee); 

15 (9) the Administrator of the Environmental Pro16 tection Agency (or a designee); 

17 (10) the Chief of Engineers (or a designee); 

18 (11) the Chair of the Council on Environmental 

19 Quality (or a designee); 

20 (12) the Administrator of the Federal Emergency 

21 Management Agency (or a designee); and 

22 (13) the heads of such other Federal agencies or 

23 departments with jurisdiction over natural resources 

24 of the United States, as determined by the President. 


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1 (d) CHAIRPERSON.—The Chair of the Council on En2 vironmental Quality shall serve as the Chairperson of the 

3 Panel. 

4 SEC. 366. NATURAL RESOURCES CLIMATE CHANGE ADAPTA5 TION STRATEGY. 

6 (a) IN GENERAL.—Not later than 1 year after the date 

7 of enactment of this Act, the Panel shall develop a Natural 

8 Resources Climate Change Adaptation Strategy— 

9 (1) to protect, restore, and conserve natural re10 sources so that natural resources become more resil11 ient, adapt to, and withstand the ongoing and ex12 pected impacts of climate change; and 

13 (2) to identify opportunities to mitigate the on14 going and expected impacts of climate change. 

15 (b) DEVELOPMENT.—In developing and revising the 

16 Strategy, the Panel shall— 

17 (1) base the strategy on the best available science; 

18 (2) develop the strategy in close cooperation with 

19 States and Indian tribes; 

20 (3) coordinate with other Federal agencies, as 

21 appropriate; 

22 (4) consult with local governments, conservation 

23 organizations, scientists, and other interested stake24 holders; and 


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1 (5) provide public notice and opportunity for 

2 comment. 

3 (c) REVISION.—After the Panel adopts the initial 

4 Strategy, the Panel shall review and revise the Strategy 

5 every 5 years to incorporate— 

6 (1) new information regarding the ongoing and 

7 expected impacts of climate change on natural re8 sources; and 

9 (2) new advances in the development of strategies 

10 that make natural resources more resilient or able to 

11 adapt to the ongoing and expected impacts of climate 

12 change. 

13 (d) CONTENTS.—The Strategy shall— 

14 (1) assess the vulnerability of natural resources 

15 to climate change, including short-term, medium16 term, long-term, cumulative, and synergistic impacts; 

17 (2) describe current research, observation, and 

18 monitoring activities at the Federal, State, tribal, 

19 and local level related to the ongoing and expected 

20 impacts of climate change on natural resources; 

21 (3) identify and prioritize research and data 

22 needs; 

23 (4) identify natural resources likely to have the 

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1 tion due to the ongoing and expanding impacts of cli2 mate change; 

3 (5) include specific protocols for integrating nat4 ural resources adaptation strategies and activities 

5 into the conservation and management of natural re6 sources by Federal departments and agencies to en7 sure consistency across agency jurisdictions; 

8 (6) include specific actions that Federal depart9 ments and agencies shall take to protect, conserve, 

10 and restore natural resources to become more resil11 ient, adapt to, and withstand the ongoing and ex12 pected impacts of climate change, including a 

13 timeline to implement those actions; 

14 (7) include specific mechanisms for ensuring 

15 communication and coordination— 

16 (A) among Federal departments and agen17 cies; and 

18 (B) between Federal departments and agen19 cies and State natural resource agencies, United 

20 States territories, Indian tribes, private land21 owners, conservation organizations, and other 

22 countries that share jurisdiction over natural re23 sources with the United States; 

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1 itoring protocols through interagency coordination 

2 and collaboration; and 

3 (9) include procedures for guiding the develop4 ment of detailed agency- and department-specific ad5 aptation plans required under section 368. 

6 (e) IMPLEMENTATION.—Consistent with other laws 

7 and Federal trust responsibilities concerning land of Indian 

8 tribes, each Federal department or agency represented on 

9 the Panel shall integrate the elements of the Strategy that 

10 relate to conservation, restoration, and management of nat11 ural resources into agency plans, environmental reviews, 

12 programs, and activities. 

13 SEC. 367. NATURAL RESOURCES ADAPTATION SCIENCE AND 

14 INFORMATION. 

15 (a) COORDINATION.—Not later than 90 days after the 

16 date of enactment of this Act, the Administrators shall es17 tablish coordinated procedures for developing and providing 

18 science and information necessary to address the ongoing 

19 and expected impacts of climate change on natural re20 sources. 

21 (b) OVERSIGHT.—The National Climate Change and 

22 Wildlife Science Center established under subsection (e) and 

23 the National Climate Service of the National Oceanic and 

24 Atmospheric Administration shall oversee development of 

25 the procedures. 


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1 (c) FUNCTIONS.—The Administrators shall— 

2 (1) ensure that the procedures required under 

3 subsection (a) avoid duplication; and 

4 (2) ensure that the National Oceanic and Atmos5 pheric Administration and the United States Geologi6 cal Survey— 

7 (A) provide technical assistance to Federal 

8 departments and agencies, State and local gov9 ernments, Indian tribes, and interested private 

10 landowners that are pursuing the goals of ad11 dressing the ongoing and expected impacts of cli12 mate change on natural resources; 

13 (B) conduct and sponsor research to develop 

14 strategies that increase the ability of natural re15 sources to become more resilient, adapt to, and 

16 withstand the ongoing and expected impacts of 

17 climate change; 

18 (C) provide Federal departments and agen19 cies, State and local governments, Indian tribes, 

20 and interested private landowners with research 

21 products, decision and monitoring tools, and in22 formation to develop strategies that increase the 

23 ability of natural resources to become more resil24 ient, adapt to, and withstand the ongoing and 

25 expected impacts of climate change; and 


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1 (D) assist Federal departments and agencies 

2 in the development of adaptation plans required 

3 by section 368. 

4 (d) SURVEY.—Not later than 1 year after the date of 

5 enactment of this Act, and every 5 years thereafter, the Sec6 retary of Commerce and the Secretary of the Interior shall 

7 conduct a climate change impact survey that— 

8 (1) identifies natural resources considered likely 

9 to be adversely affected by climate change; 

10 (2) includes baseline monitoring and ongoing 

11 trend analysis; 

12 (3) with input from stakeholders, identifies and 

13 prioritizes necessary monitoring and research that is 

14 most relevant to the needs of natural resource man15 agers to address the ongoing and expected impacts of 

16 climate change and to promote resilience; and 

17 (4) identifies the decision tools necessary to de18 velop strategies that increase the ability of natural re19 sources to become more resilient, adapt to, and with20 stand the ongoing and expected impacts of climate 

21 change. 

22 (e) NATIONAL CLIMATE CHANGE AND WILDLIFE

23 SCIENCE CENTER.— 

24 (1) ESTABLISHMENT.—The Secretary of the Inte25 rior shall establish the National Climate Change and 


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1 Wildlife Science Center within the United States Geo2 logical Survey. 

3 (2) FUNCTIONS.—In collaboration with Federal 

4 and State natural resources agencies and depart5 ments, Indian tribes, universities, and other partner 

6 organizations, the Center shall— 

7 (A) assess and synthesize current physical 

8 and biological knowledge; 

9 (B) prioritize scientific gaps in such knowl10 edge in order to forecast the ecological impacts of 

11 climate change, including, where applicable, 

12 ocean acidification, drought, flooding, and wild13 fire on fish and wildlife at the ecosystem, habi14 tat, community, population, and species levels; 

15 (C) develop and improve tools to identify, 

16 evaluate, and link scientific approaches and 

17 models that forecast the impacts of climate 

18 change, including, where applicable, ocean acidi19 fication, drought, flooding, and wildfire on fish, 

20 wildlife, plants, and associated habitats, includ21 ing— 

22 (i) monitoring; 

23 (ii) predictive models; 

24 (iii) vulnerability analyses; 

25 (iv) risk assessments; and 


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1 (v) decision support systems that help 

2 managers make informed decisions; 

3 (D) develop and evaluate tools to adaptively 

4 manage and monitor the effects of climate change 

5 (including tools for the collection of data) on fish 

6 and wildlife on the national, regional, and local 

7 level; and 

8 (E) develop capacities for sharing standard9 ized data and the synthesis of the data described 

10 in subparagraph (D). 

11 (f) SCIENCE ADVISORY BOARD.— 

12 (1) ESTABLISHMENT.—Not later than 180 days 

13 after the date of enactment of this Act, the Secretary 

14 of Commerce and the Secretary of the Interior shall 

15 establish and appoint the members of the Science Ad16 visory Board. 

17 (2) MEMBERSHIP.—The Board shall be com18 prised of not fewer than 10 and not more than 20 

19 members— 

20 (A) who have expertise in fish, wildlife, 

21 plant, aquatic, and coastal and marine biology, 

22 ecology, climate change, including, where appli23 cable, ocean acidification, drought, flooding, and 

24 wildfire, and other relevant scientific disciplines; 


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1 (B) who represent a balanced membership 

2 among Federal, State, tribal, and local rep3 resentatives, universities, and conservation orga4 nizations; and 

(C) at least 1 5 ⁄2 of whom are recommended 

6 by the President of the National Academy of 

7 Sciences. 

8 (3) DUTIES.—The Board shall— 

9 (A) advise the Secretary of Commerce and 

10 the Secretary of the Interior on the state of the 

11 science regarding— 

12 (i) the ongoing and expected impacts of 

13 climate change, including, where applicable, 

14 ocean acidification, drought, flooding, and 

15 wildfire on natural resources; and 

16 (ii) scientific strategies and mecha17 nisms for protecting, restoring, and con18 serving natural resources so natural re19 sources become more resilient, adapt to, and 

20 withstand the ongoing and expected impacts 

21 of climate change, including, where applica22 ble, ocean acidification, drought, flooding, 

23 and wildfire; and 


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1 (B) identify and recommend priorities for 

2 ongoing research needs on the issues described in 

3 subparagraph (A). 

4 (4) COLLABORATION.—The Board shall collabo5 rate with climate change and ecosystem research enti6 ties in other Federal agencies and departments. 

7 (5) AVAILABILITY TO PUBLIC.—The advice and 

8 recommendations of the Board shall be made avail9 able to the public. 

10 SEC. 368. FEDERAL NATURAL RESOURCE AGENCY ADAPTA11 TION PLANS. 

12 (a) DEVELOPMENT.—Not later than 1 year after the 

13 date of development of the Strategy, each department or 

14 agency with representation on the Panel shall— 

15 (1) complete an adaptation plan for that depart16 ment or agency that— 

17 (A) implements the Strategy and is con18 sistent with the natural resources climate change 

19 adaptation policy required by section 362; 

20 (B) details the ongoing and expanding ac21 tions of the department or agency, and any 

22 changes in decisionmaking processes necessary to 

23 increase the ability of resources under the juris24 diction of the department or agency and, to the 

25 maximum extent practicable, resources under the 


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1 jurisdiction of other departments and agencies 

2 that may be significantly affected by decisions of 

3 the department or agency, to become more resil4 ient, adapt to, and withstand the ongoing and 

5 expected impacts of climate change, including, 

6 where applicable, ocean acidification, drought, 

7 flooding, and wildfire; and 

8 (C) includes a timeline for implementation; 

9 (2) provide opportunities for public review and 

10 comment on the adaptation plan, and in the case of 

11 a plan by the Bureau of Indian Affairs, review by In12 dian tribes; and 

13 (3) submit the plan to the President for ap14 proval. 

15 (b) REVIEW BY PRESIDENT AND SUBMISSION TO CON16 GRESS.— 

17 (1) REVIEW BY PRESIDENT.—The President 

18 shall— 

19 (A) approve an adaptation plan submitted 

20 under subsection (a)(3) if the plan meets the re21 quirements of subsection (c) and is consistent 

22 with the Strategy; and 

23 (B) decide whether to approve the plan 

24 within 60 days of submission. 


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1 (2) DISAPPROVAL.—If the President disapproves 

2 an adaptation plan, the President shall direct the de3 partment or agency to submit a revised plan within 

4 60 days of that disapproval. 

5 (3) SUBMISSION TO CONGRESS.—Not later than 

6 30 days after the date of approval of an adaptation 

7 plan by the President, the department or agency shall 

8 submit the plan to— 

9 (A) the Committee on Natural Resources of 

10 the House of Representatives; 

11 (B) the Committee on Energy and Natural 

12 Resources of the Senate; 

13 (C) the Committee on Environment and 

14 Public Works of the Senate; and 

15 (D) any other committees of the House of 

16 Representatives or the Senate with principal ju17 risdiction over the department or agency. 

18 (c) REQUIREMENTS.—Each adaptation plan shall— 

19 (1) establish programs for assessing the ongoing 

20 and expected impacts of climate change, including, 

21 where applicable, ocean acidification, drought, flood22 ing, and wildfire on natural resources under the ju23 risdiction of the department or agency preparing the 

24 plan, including— 


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1 (A) assessment of cumulative and syner2 gistic effects; and 

3 (B) programs that identify and monitor 

4 natural resources likely to be adversely affected 

5 and that have need for conservation; 

6 (2) identify and prioritize— 

7 (A) the strategies of the department or agen8 cy preparing the plan; 

9 (B) the specific conservation actions that 

10 address the ongoing and expected impacts of cli11 mate change, including, where applicable, ocean 

12 acidification, drought, flooding, and wildfire on 

13 natural resources under jurisdiction of the de14 partment or agency preparing the plan; 

15 (C) strategies to protect, restore, and con16 serve such resources to become more resilient, 

17 adapt to, and better withstand those impacts, in18 cluding— 

19 (i) protection, restoration, and con20 servation of terrestrial, marine, estuarine, 

21 and freshwater habitats and ecosystems; 

22 (ii) establishment of terrestrial, ma23 rine, estuarine, and freshwater habitat link24 ages and corridors; 


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1 (iii) restoration and conservation of ec2 ological processes; 

3 (iv) protection of a broad diversity of 

4 native species of fish, wildlife, and plant 

5 populations across the ranges of those spe6 cies; and 

7 (v) protection of fish, wildlife, and 

8 plant health, recognizing that climate can 

9 alter the distribution and ecology of 

10 parasites, pathogens, and vectors; 

11 (3) describe how the department or agency 

12 will— 

13 (A) integrate the strategies and conservation 

14 activities into plans, programs, activities, and 

15 actions of the department or agency relating to 

16 the conservation and management of natural re17 sources; and 

18 (B) establish new plans, programs, activi19 ties, and actions, if necessary; 

20 (4) establish methods— 

21 (A) to assess the effectiveness of strategies 

22 and conservation actions the department or 

23 agency takes to protect, restore, and conserve 

24 natural resources so natural resources become 


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1 more resilient, adapt to, and withstand the ongo2 ing and expected impacts of climate change; and 

3 (B) to update those strategies and actions to 

4 respond to new information and changing condi5 tions; 

6 (5) describe current and proposed mechanisms to 

7 enhance cooperation and coordination of natural re8 sources adaptation efforts with other Federal agencies, 

9 State and local governments, Indian tribes, and non10 governmental stakeholders; 

11 (6) include written guidance to resource man12 agers that— 

13 (A) explains how managers are expected to 

14 address the ongoing and expected effects of cli15 mate change, including, where applicable, ocean 

16 acidification, drought, flooding, and wildfire; 

17 (B) identifies how managers shall obtain 

18 any necessary site-specific information; and 

19 (C) reflects best practices shared among rel20 evant agencies, but recognizes the unique mis21 sions, objectives, and responsibilities of each 

22 agency; 

23 (7) identify and assess data and information 

24 gaps necessary to develop natural resources adapta25 tion plans and strategies; and 


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1 (8) consider strategies that engage youth and 

2 young adults (including youth and young adults 

3 working in full-time or part-time youth service or 

4 conservation corps programs) to provide the youth 

5 and young adults with opportunities for meaningful 

6 conservation and community service and to encourage 

7 opportunities for employment in the private sector 

8 through partnerships with employers. 

9 (d) IMPLEMENTATION.— 

10 (1) IN GENERAL.—Upon approval by the Presi11 dent, each department or agency with representation 

12 on the Panel shall, consistent with existing authority, 

13 implement the adaptation plan of the department or 

14 agency through existing and new plans, policies, pro15 grams, activities, and actions. 

16 (2) CONSIDERATION OF IMPACTS.—To the max17 imum extent practicable and consistent with existing 

18 authority, natural resource management decisions 

19 made by the department or agency shall consider the 

20 ongoing and expected impacts of climate change, in21 cluding, where applicable, ocean acidification, 

22 drought, flooding, and wildfire on natural resources. 

23 (e) REVISION AND REVIEW.—Not less than every 5 

24 years, each department or agency shall review and revise 

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1 porate the best available science, and other information, re2 garding the ongoing and expected impacts of climate change 

3 on natural resources. 

4 SEC. 369. STATE NATURAL RESOURCES ADAPTATION 

5 PLANS. 

6 (a) REQUIREMENT.—In order to be eligible for funds 

7 under section 370, not later than 1 year after the develop8 ment of the Strategy, each State shall prepare a State nat9 ural resources adaptation plan detailing current and future 

10 efforts of the State to address the ongoing and expected im11 pacts of climate change on natural resources and coastal 

12 areas within the jurisdiction of the State. 

13 (b) REVIEW OR APPROVAL.— 

14 (1) IN GENERAL.—The Secretary of the Interior 

15 and, as applicable, the Secretary of Commerce shall 

16 review each State adaptation plan, and approve the 

17 plan if the plan— 

18 (A) meets the requirements of subsection (c); 

19 and 

20 (B) is consistent with the Strategy. 

21 (2) APPROVAL OR DISAPPROVAL.—The Secretary 

22 of the Interior and, as applicable, the Secretary of 

23 Commerce shall approve or disapprove the plan by 

24 written notice not later than 180 days after the date 

25 of submission of the plan (or a revised plan). 


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1 (3) RESUBMISSION.—Not later than 90 days 

2 after the date of resubmission of an adaptation plan 

3 that has been disapproved under paragraph (2), the 

4 Secretary of the Interior and, as applicable, the Sec5 retary of Commerce, shall approve or disapprove the 

6 plan by written notice. 

7 (c) CONTENTS.—A State natural resources adaptation 

8 plan shall— 

9 (1) include strategies for addressing the ongoing 

10 and expected impacts of climate change, including, 

11 where applicable, ocean acidification, drought, flood12 ing, and wildfire on terrestrial, marine, estuarine, 

13 and freshwater fish, wildlife, plants, habitats, eco14 systems, wildlife health, and ecological processes 

15 that— 

16 (A) describe the ongoing and expected im17 pacts of climate change, including, where appli18 cable, ocean acidification, drought, flooding, and 

19 wildfire on the diversity and health of fish, wild20 life and plant populations, habitats, ecosystems, 

21 and associated ecological processes; 

22 (B) establish programs for monitoring the 

23 ongoing and expected impacts of climate change, 

24 including, where applicable, ocean acidification, 

25 drought, flooding, and wildfire on fish, wildlife, 


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1 and plant populations, habitats, ecosystems, and 

2 associated ecological processes; 

3 (C) describe and prioritize proposed con4 servation actions that increase the ability of fish, 

5 wildlife, plant populations, habitats, ecosystems, 

6 and associated ecological processes to become 

7 more resilient, adapt to, and better withstand 

8 those impacts; 

9 (D) consider strategies that engage youth 

10 and young adults (including youth and young 

11 adults working in full-time or part-time youth 

12 service or conservation corps programs) to pro13 vide the youth and young adults with opportuni14 ties for meaningful conservation and community 

15 service and to encourage opportunities for em16 ployment in the private sector through partner17 ships with employers; 

18 (E) integrate protection and restoration of 

19 resource resilience into agency decision making 

20 and specific conservation actions; 

21 (F) include a time frame for implementing 

22 conservation actions for fish, wildlife, and plant 

23 populations, habitats, ecosystems, and associated 

24 ecological processes; 

25 (G) establish methods— 


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1 (i) for assessing the effectiveness of 

2 strategies and conservation actions taken to 

3 increase the ability of fish, wildlife, and 

4 plant populations, habitats, ecosystems, and 

5 associated ecological processes to become 

6 more resilient, adapt to, and better with7 stand the ongoing and expected impacts of 

8 climate changes, including, where applica9 ble, ocean acidification, drought, flooding, 

10 and wildfire; and 

11 (ii) for updating strategies and actions 

12 to respond appropriately to new informa13 tion or changing conditions; 

14 (H) are incorporated into a revision of the 

15 State wildlife action plan (also known as the 

16 State comprehensive wildlife strategy) that has 

17 been— 

18 (i) submitted to the United States Fish 

19 and Wildlife Service; and 

20 (ii) approved, or is pending approval, 

21 by the United States Fish and Wildlife 

22 Service; and 

23 (I) are developed— 

24 (i) with the participation of the State 

25 fish and wildlife agency, the State coastal 


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1 agency, the State agency responsible for ad2 ministration of Land and Water Conserva3 tion Fund grants, the State Forest Legacy 

4 program coordinator, and other State agen5 cies considered appropriate by the Governor 

6 of the State; 

7 (ii) in coordination with the Secretary 

8 of the Interior, and where applicable, the 

9 Secretary of Commerce; 

10 (iii) in coordination with other States 

11 that share jurisdiction over natural re12 sources with the State; and 

13 (iv) in coordination with— 

14 (I) Indian tribes that located 

15 within the State; and 

16 (II) Indian tribes having treaty 

17 rights to natural resources within the 

18 State; and 

19 (2) in the case of a coastal State, include strate20 gies for addressing the ongoing and expected impacts 

21 of climate change, including, where applicable, ocean 

22 acidification, drought, flooding, and wildfire on a 

23 coastal zone that— 


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1 (A) identify natural resources likely to be 

2 impacted by climate change, and describe the 

3 impacts; 

4 (B) identify and prioritize continuing re5 search and data collection needed to address the 

6 impacts, including— 

7 (i) acquisition of high-resolution coast8 al elevation and nearshore bathymetry data; 

9 (ii) historic shoreline position maps, 

10 erosion rates, and inventories of shoreline 

11 features and structures; 

12 (iii) measures and models of relative 

13 rates of sea level rise or lake level changes, 

14 including effects on flooding, storm surge, 

15 inundation, and coastal geological processes; 

16 (iv) measures and models of habitat 

17 loss, including projected losses of coastal 

18 wetlands and potentials for inland migra19 tion of natural shoreline habitats; 

20 (v) measures and models of ocean and 

21 coastal species and ecosystem migrations, 

22 and changes in species population dynam23 ics; 

24 (vi) changes in storm frequency, inten25 sity, or rainfall patterns; 


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1 (vii) measures and models of saltwater 

2 intrusion into coastal rivers and aquifers; 

3 (viii) changes in chemical or physical 

4 characteristics of marine and estuarine sys5 tems, including the presence, extent, and 

6 timing of hypoxic and anoxic conditions; 

7 (ix) measures and models of increased 

8 harmful algal blooms; and 

9 (x) measures and models of the spread 

10 of invasive species; 

11 (C) identify and prioritize adaptation 

12 strategies to protect, restore, and conserve nat13 ural resources to enable natural resources to be14 come more resilient, adapt to, and withstand the 

15 ongoing and expected impacts of climate change, 

16 including, where applicable, ocean acidification, 

17 drought, flooding, and wildfire, including— 

18 (i) protection, maintenance, and res19 toration of ecologically important coastal 

20 lands, coastal and ocean ecosystems, and 

21 species biodiversity and the establishment of 

22 habitat buffer zones, migration corridors, 

23 and climate refugia; and 


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1 (ii) improved planning, siting policies, 

2 hazard mitigation strategies, and State 

3 property insurance programs; 

4 (D) establish programs— 

5 (i) for the long-term monitoring of the 

6 ongoing and expected impacts of climate 

7 change, including, where applicable, ocean 

8 acidification, drought, flooding, and wild9 fire on the ocean and coastal zone; and 

10 (ii) assess and adjust, when necessary, 

11 the adaptive management strategies; 

12 (E) establish performance measures that— 

13 (i) assess the effectiveness of adaptation 

14 strategies intended to improve resilience 

15 and the ability of natural resources to 

16 adapt to and withstand the ongoing and ex17 pected impacts of climate change, including, 

18 where applicable, ocean acidification, 

19 drought, flooding, and wildfire; 

20 (ii) assess the effectiveness of adapta21 tion strategies intended to minimize those 

22 impacts on the coastal zone; and 

23 (iii) update the strategies to respond to 

24 new information or changing conditions; 

25 and 


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1 (F) are developed— 

2 (i) with the participation of the State 

3 coastal agency and other appropriate State 

4 agencies; and 

5 (ii) in coordination with the Secretary 

6 of Commerce and other appropriate Federal 

7 agencies. 

8 (d) PUBLIC INPUT.—In developing the adaptation 

9 plan, a State shall provide for solicitation and consider10 ation of public input and independent scientific input. 

11 (e) COORDINATION WITH OTHER PLANS.—The State 

12 adaptation plan shall review research and information and, 

13 where appropriate, integrate the goals and measures set 

14 forth in other natural resources conservation strategies, in15 cluding— 

16 (1) the National Fish Habitat Action Plan; 

17 (2) plans under the North American Wetlands 

18 Conservation Act (16 U.S.C. 4401 et seq.); 

19 (3) the Federal, State, and local partnership 

20 known as ‘‘Partners in Flight’’; 

21 (4) federally approved coastal zone management 

22 plans under the Coastal Zone Management Act of 

23 1972 (16 U.S.C. 1451 et seq.); 

24 (5) federally approved regional fishery manage25 ment plants and habitat conservation activities under 


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1 the Magnuson-Stevens Fishery Conservation and 

2 Management Act (16 U.S.C. 1801 et seq.); 

3 (6) the National Coral Reef Action Plan; 

4 (7) recovery plans for threatened species and en5 dangered species under section 4(f) of the Endangered 

6 Species Act of 1973 (16 U.S.C. 1533(f)); 

7 (8) habitat conservation plans under section 10 

8 of that Act (16 U.S.C. 1539); 

9 (9) other Federal, State, and tribal plans for im10 periled species; 

11 (10) State or tribal hazard mitigation plans; 

12 (11) State or tribal water management plans; 

13 (12) State property insurance programs; and 

14 (13) other State-based strategies that comprehen15 sively implement adaptation activities to remediate 

16 the ongoing and expected effects of climate change, in17 cluding, where applicable, ocean acidification, 

18 drought, flooding, and wildfire, on terrestrial, marine, 

19 and freshwater fish, wildlife, plants, and other nat20 ural resources. 

21 (f) UPDATING.—Each State plan shall be updated at 

22 least every 5 years. 

23 (g) FUNDING.— 

24 (1) IN GENERAL.—Funds allocated to States 

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1 sistent with a State natural resources adaptation 

2 plan approved by the Secretary of the Interior and, 

3 as appropriate, the Secretary of Commerce. 

4 (2) FUNDING PRIOR TO THE APPROVAL OF A

5 STATE PLAN.—Until the earlier of the date that is 3 

6 years after the date of enactment of this Act or the 

7 date on which a State adaptation plan is approved, 

8 a State shall be eligible to receive funding under sec9 tion 370 for adaptation activities that are— 

10 (A) consistent with the comprehensive wild11 life strategy of the State and, where appropriate, 

12 other natural resources conservation strategies; 

13 and 

14 (B) in accordance with a work plan devel15 oped in coordination with— 

16 (i) the Secretary of the Interior; and 

17 (ii) the Secretary of Commerce. 

18 (3) COASTAL STATE.—In developing a work plan 

19 under paragraph (2)(B), a coastal State shall coordi20 nate with the Secretary of Commerce only for those 

21 portions of the strategy relating to activities affecting 

22 the coastal zone. 

23 (4) PENDING APPROVAL.—During the period for 

24 which approval by the applicable Secretary is pend25 ing, the State may continue to receive funds under 


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1 section 370 pursuant to the work plan described in 

2 paragraph (2)(B). 

3 SEC. 370. NATURAL RESOURCES CLIMATE CHANGE ADAPTA4 TION ACCOUNT. 

5 (a) DISTRIBUTION.— 

6 (1) STATES.—The assistance made available 

7 pursuant to section 771(a)(16) of the Clean Air Act 

8 and section 216 of division B for each fiscal year 

9 shall be provided to States to carry out natural re10 sources adaptation activities in accordance with ad11 aptation plans approved under section 369, and shall 

12 be distributed as follows: 

13 (A) 84 percent shall be available to State 

14 wildlife agencies in accordance with the appor15 tionment formula established under the second 

16 subsection (c) (relating to the apportionment of 

17 the Wildlife Conservation and Restoration Ac18 count) of section 4 of the Pittman-Robertson 

19 Wildlife Restoration Act (16 U.S.C. 669c). 

20 (B) 16 percent shall be available to State 

21 coastal agencies pursuant to the formula estab22 lished by the Secretary of Commerce under sec23 tion 306(c) of the Coastal Management Act of 

24 1972 (16 U.S.C. 1455(c)). 


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1 (2) NATURAL RESOURCE ADAPTATION.—Of the 

2 amounts made available pursuant to section 771(b)(7) 

3 of the Clean Air Act and section 212 of division B 

4 for each fiscal year to carry out this subpart— 

5 (A) 28 percent shall be allocated to the Sec6 retary of the Interior for use in funding— 

7 (i) natural resources adaptation activi8 ties carried out— 

9 (I) under endangered species, mi10 gratory species, and other fish and 

11 wildlife programs administered by the 

12 National Park Service, the United 

13 States Fish and Wildlife Service, the 

14 Bureau of Indian Affairs, and the Bu15 reau of Land Management; 

16 (II) on wildlife refuges, National 

17 Park Service land, and other public 

18 land under the jurisdiction of the 

19 United States Fish and Wildlife Serv20 ice, the Bureau of Land Management, 

21 the Bureau of Indian Affairs, or the 

22 National Park Service; and 

23 (III) within Federal water man24 aged by the Bureau of Reclamation 

25 and the National Park Service; and 


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1 (ii) the implementation of the National 

2 Fish and Wildlife Habitat and Corridors 

3 Information Program required by section 

4 371; 

5 (B) 8 percent shall be allocated to the Sec6 retary of the Interior for natural resources adap7 tation activities carried out under cooperative 

8 grant programs, including— 

9 (i) the cooperative endangered species 

10 conservation fund authorized under section 

11 6 of the Endangered Species Act of 1973 (16 

12 U.S.C. 1535); 

13 (ii) programs under the North Amer14 ican Wetlands Conservation Act (16 U.S.C. 

15 4401 et seq.); 

16 (iii) the Neotropical Migratory Bird 

17 Conservation Fund established by section 

18 9(a) of the Neotropical Migratory Bird Con19 servation Act (16 U.S.C. 6108(a)); 

20 (iv) the Coastal Program of the United 

21 States Fish and Wildlife Service; 

22 (v) the National Fish Habitat Action 

23 Plan; 

24 (vi) the Partners for Fish and Wildlife 

25 Program; 


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1 (vii) the Landowner Incentive Pro2 gram; 

3 (viii) the Wildlife Without Borders 

4 Program of the United States Fish and 

5 Wildlife Service; and 

6 (ix) the Migratory Species Program 

7 and Park Flight Migratory Bird Program 

8 of the National Park Service; and 

9 (C) 5 percent shall be allocated to the Sec10 retary of the Interior to provide financial assist11 ance to Indian tribes to carry out natural re12 sources adaptation activities through— 

13 (i) the Trust Natural Resources Pro14 gram of the Bureau of Indian Affairs; and 

15 (ii) the Tribal Wildlife Grants Pro16 gram of the United States Fish and Wildlife 

17 Service. 

18 (3) LAND AND WATER CONSERVATION.— 

19 (A) DEPOSITS.— 

20 (i) IN GENERAL.—Of the amounts 

21 made available pursuant to section 

22 771(b)(7) of the Clean Air Act and section 

23 212 of division B for each fiscal year to 

24 carry out this subpart, 20 percent shall be 

25 deposited in the Land and Water ConservaVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01216 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 tion Fund established under section 2 of the 

2 Land and Water Conservation Fund Act of 

3 1965 (16 U.S.C. 460l–5). 

4 (ii) USE OF DEPOSITS.—Deposits in 

5 the Land and Water Conservation Fund 

6 under this paragraph shall— 

7 (I) be supplemental to authoriza8 tions provided under section 3 of the 

9 Land and Water Conservation Fund 

10 Act of 1965 (16 U.S.C. 460l–6), which 

11 shall remain available for nonadapta12 tion needs; and 

13 (II) be available to carry out this 

14 subpart without further appropriation 

15 or fiscal year limitation. 

16 (B) DISTRIBUTION OF AMOUNTS.—Of the 

17 amounts deposited under this paragraph in the 

18 Land and Water Conservation Fund— 

19 (i) for the purposes of carrying out the 

20 natural resources adaptation activities 

21 through the acquisition of land and inter22 ests in land under section 6 of the Land 

23 and Water Conservation Fund Act of 1965 

(16 U.S.C. 460l–8), 1 24 ⁄6 shall be allocated to 


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1 the Secretary of the Interior and made 

2 available on a competitive basis— 

3 (I) to States, in accordance with 

4 the natural resources adaptation plans 

5 of States, and to Indian tribes; 

6 (II) notwithstanding section 5 of 

7 that Act (16 U.S.C. 460l–7); and 

8 (III) in addition to any funds 

9 provided pursuant to annual appro10 priations Acts, the Energy Policy Act 

11 of 2005 (42 U.S.C. 15801 et seq.), or 

12 any other authorization for non13 adaptation needs; 

(ii) 1 14 ⁄3 shall be allocated to the Sec15 retary of the Interior to carry out natural 

16 resources adaptation activities through the 

17 acquisition of lands and interests in land 

18 under section 7 of the Land and Water Con19 servation Fund Act of 1965 (16 U.S.C. 

20 460l–9); 

(iii) 1 21 ⁄6 shall be allocated to the Sec22 retary of Agriculture and made available to 

23 the States and Indian tribes to carry out 

24 natural resources adaptation activities 

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1 ests in land under section 7 of the Coopera2 tive Forestry Assistance Act of 1978 (16 

3 U.S.C. 2103c); and 

(iv) 1 4 ⁄3 shall be allocated to the Sec5 retary of Agriculture to carry out natural 

6 resources adaptation activities through the 

7 acquisition of land and interests in land 

8 under section 7 of the Land and Water Con9 servation Fund Act of 1965 (16 U.S.C. 

10 460l–9). 

11 (C) EXPENDITURE OF FUNDS.—In allo12 cating funds under subparagraph (B), the Sec13 retary of the Interior and the Secretary of Agri14 culture shall take into consideration factors in15 cluding— 

16 (i) the availability of non-Federal con17 tributions from State, local, or private 

18 sources; 

19 (ii) opportunities to protect fish and 

20 wildlife corridors or otherwise to link or 

21 consolidate fragmented habitats; 

22 (iii) opportunities to reduce the risk of 

23 catastrophic wildfires, drought, extreme 

24 flooding, or other climate-related events that 


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1 are harmful to fish and wildlife and people; 

2 and 

3 (iv) the potential for conservation of 

4 species or habitat types at serious risk due 

5 to climate change, including, where applica6 ble, ocean acidification, drought, flooding, 

7 and wildfire, or other stressors. 

8 (4) NATIONAL FOREST AND GRASSLAND ADAPTA9 TION.—Of the amounts made available pursuant to 

10 section 771(b)(7) of the Clean Air Act and section 212 

11 of division B for each fiscal year to carry out this 

12 subpart, 8 percent shall be allocated to the Forest 

13 Service, through the Secretary of Agriculture— 

14 (A) to fund natural resources adaptation 

15 activities carried out in national forests and na16 tional grasslands under the jurisdiction of the 

17 Forest Service; and 

18 (B) to carry out natural resource adapta19 tion activities on State and private forest land 

20 carried out under the Cooperative Forestry As21 sistance Act of 1978 (16 U.S.C. 2101 et seq.). 

22 (5) COASTAL AND MARINE SYSTEM ADAPTA23 TION.—Of the amounts made available pursuant to 

24 section 771(b)(7) of the Clean Air Act and section 212 

25 of division B for each fiscal year to carry out this 


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1 subpart, 11 percent shall be allocated to the Secretary 

2 of Commerce to fund natural resources adaptation ac3 tivities that protect, maintain, and restore coastal, es4 tuarine, and marine resources, habitats, and eco5 systems, including such activities carried out under— 

6 (A) the coastal and estuarine land conserva7 tion program administered by the National Oce8 anic and Atmospheric Administration; 

9 (B) the community-based restoration pro10 gram for fishery and coastal habitats established 

11 under section 117 of the Magnuson-Stevens Fish12 ery Conservation and Management Reauthoriza13 tion Act of 2006 (16 U.S.C. 1891a); 

14 (C) the Coastal Zone Management Act of 

15 1972 (16 U.S.C. 1451 et seq.) that are specifi16 cally designed to strengthen the ability of coastal, 

17 estuarine, and marine resources, habitats, and 

18 ecosystems to adapt to and withstand the ongo19 ing and expected impacts of climate change, in20 cluding, where applicable, ocean acidification, 

21 drought, flooding, and wildfire; 

22 (D) the Open Rivers Initiative; 

23 (E) the Magnuson-Stevens Fishery Con24 servation and Management Act (16 U.S.C. 1801 

25 et seq.); 


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1 (F) the Marine Mammal Protection Act of 

2 1972 (16 U.S.C. 1361 et seq.); 

3 (G) the Endangered Species Act of 1973 (16 

4 U.S.C. 1531 et seq.); 

5 (H) the Marine Protection, Research, and 

6 Sanctuaries Act of 1972 (33 U.S.C. 1401 et seq.); 

7 (I) the Coral Reef Conservation Act of 2000 

8 (16 U.S.C. 6401 et seq.); and 

9 (J) the Estuary Restoration Act of 2000 (33 

10 U.S.C. 2901 et seq.). 

11 (6) ESTUARINE AND FRESHWATER ECOSYSTEM

12 ADAPTATION.—Of the amounts made available pursu13 ant to section 771(b)(7) of the Clean Air Act and sec14 tion 212 of division B for each fiscal year to carry 

15 out this subpart, 12 percent shall be allocated to the 

16 Administrator of the Environmental Protection Agen17 cy and 8 percent shall be available to the Secretary 

18 of the Army for use by the Corps of Engineers for use 

19 in natural resources adaptation activities restoring 

20 and protecting— 

21 (A) large-scale freshwater aquatic eco22 systems, such as the Everglades, the Great Lakes, 

23 Flathead Lake, the Missouri River, the Mis24 sissippi River, the Colorado River, the Sac25 ramento-San Joaquin Rivers, the Ohio River, 


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1 the Columbia-Snake River System, the Apalachi2 cola, Chattahoochee, and Flint River System, the 

3 Connecticut River, the Rio Grande River, and 

4 the Yellowstone River; 

5 (B) large-scale estuarine ecosystems, such as 

6 Chesapeake Bay, Long Island Sound, Puget 

7 Sound, the Mississippi River Delta, the San 

8 Francisco Bay Delta, Narragansett Bay, and Al9 bemarle-Pamlico Sound; 

10 (C) freshwater and estuarine ecosystems, 

11 watersheds, and basins identified and prioritized 

12 by the Administrator of the Environmental Pro13 tection Agency or the Corps of Engineers, work14 ing in cooperation with other Federal agencies, 

15 States, Indian tribes, local governments, sci16 entists, and other conservation partners; and 

17 (D)(i) habitats and ecosystems through estu18 ary habitat restoration projects authorized by the 

19 Estuary Restoration Act of 2000 (33 U.S.C. 

20 2901 et seq.); 

21 (ii) project modifications for improvement 

22 of the environment; 

23 (iii) aquatic restoration and protection 

24 projects authorized by section 206 of the Water 


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1 Resources Development Act of 1996 (33 U.S.C. 

2 2330); and 

3 (iv) other appropriate programs and activi4 ties. 

5 (b) USE OF FUNDS BY FEDERAL DEPARTMENTS AND

6 AGENCIES.—Funds allocated to Federal departments and 

7 agencies under this section shall only be used for natural 

8 resources adaptation activities consistent with an adapta9 tion plan approved under section 368. 

10 (c) STATE COST-SHARING.—Notwithstanding any 

11 other provision of law, a State that receives a grant under 

12 this section shall use funds from non-Federal sources to pay 

13 10 percent of the costs of each activity carried out under 

14 the grant. 

15 SEC. 371. NATIONAL FISH AND WILDLIFE HABITAT AND 

16 CORRIDORS INFORMATION PROGRAM. 

17 (a) DEFINITIONS.—In this section: 

18 (1) GEOSPATIAL INTEROPERABILITY FRAME19 WORK.—The term ‘‘Geospatial Interoperability 

20 Framework’’ means the strategy used by the National 

21 Biological Information Infrastructure (based on ac22 cepted standards, specifications, and protocols adopt23 ed through the International Standards Organization, 

24 the Open Geospatial Consortium, and the Federal Ge25 ographic Data Committee) to manage, archive, inteVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01224 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 grate, analyze, and make geospatial and biological 

2 data and metadata accessible. 

3 (2) PROGRAM.—The term ‘‘Program’’ means the 

4 National Fish and Wildlife Habitat and Corridors 

5 Information Program established under subsection 

6 (b). 

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

8 the Secretary of the Interior. 

9 (4) SYSTEM.—The term ‘‘System’’ means the 

10 Habitat and Corridors Information System estab11 lished under subsection (d)(1). 

12 (b) ESTABLISHMENT.—Not later than 180 days after 

13 the date of enactment of this Act, the Secretary, in coopera14 tion with the States and Indian tribes, shall establish a Na15 tional Fish and Wildlife Habitat and Corridors Informa16 tion Program. 

17 (c) PURPOSE.—The purposes of the Program are— 

18 (1) to support States and Indian tribes in devel19 oping geographical information system databases of 

20 fish and wildlife habitats and corridors that— 

21 (A) inform planning and development deci22 sions within each State and Indian tribe; 

23 (B) enable each State and Indian tribe to 

24 model climate impacts and adaptation; and 


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1 (C) provide geographically specific enhance2 ments of State wildlife action plans and con3 servation or natural resource management plans 

4 of Indian tribes; 

5 (2) to ensure the collaborative development of a 

6 comprehensive national geographic information sys7 tem database of maps, models, data, surveys, informa8 tional products, and other geospatial information re9 garding fish and wildlife habitat and corridors that— 

10 (A) is based on consistent protocols for sam11 pling and mapping across landscapes; 

12 (B) takes into account regional differences; 

13 and 

14 (C) uses— 

15 (i) existing and planned State- and 

16 tribal-based geographical information sys17 tem databases; and 

18 (ii) existing databases, analytical tools, 

19 metadata activities, and other information 

20 products available through the National Bi21 ological Information Infrastructure main22 tained by the Secretary and nongovern23 mental organizations; and 

24 (3) to facilitate the use of those databases by 

25 Federal, State, local, and tribal decisionmakers to inVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01226 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 corporate qualitative information on fish and wildlife 

2 habitats and corridors at the earliest practicable stage 

3 for use in— 

4 (A) prioritizing and targeting natural re5 sources adaptation strategies and activities; 

6 (B) avoiding, minimizing, and mitigating 

7 the impacts on fish and wildlife habitat and cor8 ridors when locating energy development, water, 

9 transmission, transportation, and other land use 

10 projects; 

11 (C) assessing the impacts of existing devel12 opment on habitats and corridors; and 

13 (D) developing management strategies that 

14 enhance the ability of fish, wildlife, and plant 

15 species to migrate or respond to shifting habitats 

16 within existing habitats and corridors. 

17 (d) HABITAT AND CORRIDORS INFORMATION SYS18 TEM.— 

19 (1) IN GENERAL.—The Secretary, in cooperation 

20 with States and Indian tribes, shall establish a Habi21 tat and Corridors Information System. 

22 (2) CONTENTS.—The System shall— 

23 (A) include maps, data, and descriptions of 

24 fish and wildlife habitat and corridors that— 


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1 (i) have been developed by Federal 

2 agencies, State wildlife agencies, and nat3 ural heritage programs, Indian tribes, local 

4 governments, nongovernmental organiza5 tions, and industry; and 

6 (ii) meet accepted geospatial interoper7 ability framework data and metadata pro8 tocols and standards; 

9 (B) include maps and descriptions of pro10 jected shifts in habitats and corridors of fish and 

11 wildlife species in response to climate change; 

12 (C) ensure data quality; 

13 (D) at scales useful to decisionmakers, make 

14 data, models, and analyses included in the Sys15 tem available— 

16 (i) to prioritize and target natural re17 sources adaptation strategies and activities; 

18 (ii) to assess the impacts of existing de19 velopment on habitats and corridors; 

20 (iii) to assess the impacts of proposed 

21 energy development, water, transmission, 

22 transportation, and other land use projects 

23 and to avoid, minimize, or mitigate those 

24 impacts on habitats and corridors; and 


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1 (iv) to develop management strategies 

2 that enhance the ability of fish, wildlife, 

3 and plant species to migrate or respond to 

4 shifting habitats within existing habitats 

5 and corridors; 

6 (E) update maps and other information as 

7 landscapes, habitats, corridors, and wildlife pop8 ulations change, or as new information becomes 

9 available; 

10 (F) encourage development of collaborative 

11 plans by Federal and State agencies and Indian 

12 tribes that monitor and evaluate the ability of 

13 the System to meet the needs of decisionmakers; 

14 (G) identify gaps in habitat and corridor 

15 information, mapping, and research needed to 

16 fully assess current data and metadata; 

17 (H) prioritize research and future data col18 lection activities for use in updating the System 

19 and provide support for those activities; 

20 (I) include mechanisms to support collabo21 rative research, mapping, and planning of habi22 tats and corridors by Federal and State agencies, 

23 Indian tribes, and other interested stakeholders; 

24 (J) incorporate biological and geospatial 

25 data on species and corridors found in energy 


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1 development and transmission plans, including 

2 renewable energy initiatives, transportation, and 

3 other land use plans; 

4 (K) identify, prioritize, and describe key 

5 parcels of non-Federal land that— 

6 (i) are located within units of the Na7 tional Park System, National Wildlife Ref8 uge System, National Forest System, or Na9 tional Grassland System; and 

10 (ii) are critical to maintenance of 

11 wildlife habitat and migration corridors; 

12 and 

13 (L) be based on the best scientific informa14 tion available. 

15 (e) FINANCIAL AND OTHER SUPPORT.—The Secretary 

16 may provide support to the States and Indian tribes, in17 cluding financial and technical assistance, for activities 

18 that support the development and implementation of the 

19 System. 

20 (f) COORDINATION.—In cooperation with States and 

21 Indian tribes, the Secretary shall recommend how the infor22 mation in the System may be incorporated into relevant 

23 State and Federal plans that affect fish and wildlife, in24 cluding— 

25 (1) land management plans; 


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1 (2) the State Comprehensive Wildlife Conserva2 tion Strategies; and 

3 (3) appropriate tribal conservation plans. 

4 (g) PURPOSE OF INCORPORATION.—The Secretary 

5 shall make the recommendations required by subsection (f) 

6 to ensure that relevant State and Federal plans that affect 

7 fish and wildlife— 

8 (1) prevent unnecessary habitat fragmentation 

9 and disruption of corridors; 

10 (2) promote the landscape connectivity necessary 

11 to allow wildlife to move as necessary to meet biologi12 cal needs, adjust to shifts in habitat, and adapt to cli13 mate change; and 

14 (3) minimize the impacts of energy, development, 

15 water, transportation, and transmission projects and 

16 other activities expected to impact habitat and cor17 ridors. 

18 SEC. 372. ADDITIONAL PROVISIONS REGARDING INDIAN 

19 TRIBES. 

20 (a) FEDERAL TRUST RESPONSIBILITY.—Nothing in 

21 this subpart amends, alters, or gives priority over the Fed22 eral trust responsibility to any Indian tribe. 

23 (b) EXEMPTION FROM FOIA.—If a Federal depart24 ment or agency receives any information relating to sacred 

25 sites or cultural activities identified by an Indian tribe as 


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1 confidential, such information shall be exempt from disclo2 sure under section 552 of title 5, United States Code (com3 monly referred to as the Freedom of Information Act). 

4 (c) APPLICATION OF OTHER LAW.—The Secretary of 

5 the Interior may apply the provisions of the Indian Self6 Determination and Education Assistance Act (25 U.S.C. 

7 450 et seq.) in the implementation of this subpart. 

8 (d) PROTECTION OF RIGHT AND ACCESS OF INDIAN

9 TRIBES TO FIRST FOODS.— 

10 (1) DEFINITION OF FIRST FOODS.—In this sub11 section, the term ‘‘first foods’’ means roots, berries, 

12 and plants. 

13 (2) PROTECTION.—Consistent with the Natural 

14 Resources Climate Change Adaptation Policy under 

15 section 362 and the Strategy, Federal departments 

16 and agencies, States, and Indian tribes shall ensure 

17 communication and coordination to protect treaty-re18 served rights of Indian tribes to gather first foods. 

19 Subpart D—Additional Climate Change Adaptation 

20 Programs 

21 SEC. 381. WATER SYSTEM MITIGATION AND ADAPTATION 

22 PARTNERSHIPS. 

23 (a) DEFINITIONS.—In this section: 

24 (1) OWNER OR OPERATOR.— 


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1 (A) IN GENERAL.—The term ‘‘owner or op2 erator’’ means a person (including a regional, 

3 tribal, local, municipal, or private entity) that 

4 owns or operates a water system. 

5 (B) INCLUSION.—The term ‘‘owner or oper6 ator’’ includes— 

7 (i) a non-Federal entity that has oper8 ational responsibilities for a federally or 

9 State owned water system; and 

10 (ii) an entity formed pursuant to any 

11 State’s joint exercise of powers statutes that 

12 includes one or more of the entities in para13 graph (A). 

14 (2) WATER SYSTEM.—The term ‘‘water system’’ 

15 means— 

16 (A) a community water system (as defined 

17 in section 1401 of the Safe Drinking Water Act 

18 (42 U.S.C. 300f)); 

19 (B) a treatment works (as defined in section 

20 212 of the Federal Water Pollution Control Act 

21 (33 U.S.C. 1292)), including a municipal sepa22 rate storm sewer system; 

23 (C) a decentralized wastewater treatment 

24 system for domestic sewage; 


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1 (D) a groundwater storage and replenish2 ment system; or 

3 (E) a system for transport and delivery of 

4 water for irrigation or conservation. 

5 (b) ESTABLISHMENT.—The Administrator shall estab6 lish a water system mitigation and adaptation partnership 

7 program to provide funds to States and Indian tribes for 

8 water system adaptation projects. 

9 (c) GRANTS.—Beginning in fiscal year 2010, each 

10 State or Indian tribe receiving funds pursuant to this sec11 tion shall make grants to owners or operators of water sys12 tems to address any ongoing or forecasted (based on the best 

13 available research and data) climate-related impact on the 

14 water quality, water supply or reliability of a region of the 

15 United States, for the purposes of mitigating or adapting 

16 to the impacts of climate change. 

17 (d) ELIGIBLE USES.—The funds made available to 

18 each State or Indian tribe pursuant to this section shall 

19 be used exclusively to assist in the planning, design, con20 struction, implementation, or operation or maintenance of 

21 any program or project to respond or increase the resilience 

22 of a water system to climate change by— 

23 (1) conserving water or enhancing water use effi24 ciency, including through the use of water metering 


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1 and electronic sensing and control systems to measure 

2 the effectiveness of a water efficiency program; 

3 (2) modifying or relocating existing water sys4 tem infrastructure made or projected to be signifi5 cantly impaired by climate change impacts; 

6 (3) preserving or improving water quality, in7 cluding through measures to manage, reduce, treat, or 

8 reuse municipal stormwater, wastewater, or drinking 

9 water; 

10 (4) investigating, designing, or constructing 

11 groundwater remediation, recycled water, or desalina12 tion facilities or systems to serve existing commu13 nities; 

14 (5) enhancing water management by increasing 

15 watershed preservation and protection, such as 

16 through the use of natural or engineered green infra17 structure in the management, conveyance, or treat18 ment of water, wastewater, or stormwater; 

19 (6) enhancing energy efficiency or the use and 

20 generation of renewable energy in the management, 

21 conveyance, or treatment of water, wastewater, or 

22 stormwater; 

23 (7) supporting the adoption and use of advanced 

24 water treatment, water supply management (such as 

25 reservoir reoperation and water banking), or water 


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1 demand management technologies, projects, or proc2 esses (such as water reuse and recycling, adaptive 

3 conservation pricing, and groundwater banking) that 

4 maintain or increase water supply or improve water 

5 quality; 

6 (8) modifying or replacing existing systems or 

7 constructing new systems for existing communities or 

8 land currently in agricultural production to improve 

9 water supply, reliability, storage, or conveyance in a 

10 manner that— 

11 (A) promotes conservation or improves the 

12 efficiency of utilization of available water sup13 plies; and 

14 (B) does not further exacerbate stresses on 

15 ecosystems or cause redirected impacts by de16 grading water quality or increasing net green17 house gas emissions; 

18 (9) supporting practices and projects, such as 

19 improved irrigation systems, water banking and other 

20 forms of water transactions, groundwater recharge, 

21 stormwater capture, groundwater conjunctive use, and 

22 reuse or recycling of drainage water, to improve 

23 water quality or promote more efficient water use on 

24 land currently in agricultural production; 


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1 (10) conducting and completing studies or as2 sessments to project how climate change may impact 

3 the future operations and sustainability of water sys4 tems; or 

5 (11) developing and implementing mitigation 

6 and adaptation measures to rapidly address impacts 

7 from climate change on water systems and regional 

8 and hydrological basins through cooperative activities 

9 with other States that share the same regional or 

10 hydrological basin (such as the Colorado River 

11 Basin), water system, or shoreline. 

12 (e) APPLICATION.—To be eligible to receive a grant 

13 from the State of Indian tribe under this section, the owner 

14 or operator of a water system shall submit to the State or 

15 Indian tribe an application that— 

16 (1) includes a proposal of the program, strategy, 

17 or infrastructure improvement to be planned, de18 signed, constructed, implemented, or maintained by 

19 the water system; 

20 (2) cites the best available research or data that 

21 demonstrate— 

22 (A) the risk to the water resources or infra23 structure of the water system as a result of ongo24 ing or forecasted changes to the hydrological sys25 tem brought about by factors arising from cliVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01237 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 mate change, including rising sea levels and 

2 changes in precipitation levels; and 

3 (B) how the proposed program, strategy, or 

4 infrastructure improvement would perform 

5 under the anticipated climate conditions; and 

6 (3) explains how the proposed program, strategy, 

7 or infrastructure improvement is expected to enhance 

8 the resiliency of the water system, including source 

9 water protection for community water systems, to 

10 these risks or reduce the direct or indirect greenhouse 

11 gas emissions of the water system. 

12 (f) COMPETITIVE PROCESS.— 

13 (1) IN GENERAL.—Each calendar year, each 

14 State shall conduct a competitive process to select and 

15 fund applications under this section. 

16 (2) PRIORITY REQUIREMENTS AND

17 WEIGHTING.—In carrying out the process, the States 

18 shall— 

19 (A) prioritize funding of applications that 

20 are submitted by the owners or operators of 

21 water systems that are, based on the best avail22 able research and data, at the greatest and most 

23 immediate risk of facing significant climate-re24 lated negative impacts on water quality or quan25 tity; and 


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1 (B) in selecting among the priority applica2 tions determined under subparagraph (A), en3 sure that, to the maximum extent practicable, the 

4 final list of applications funded for each year in5 cludes a substantial number meeting one or more 

6 of each of the following goals— 

7 (i) promote more efficient water use, 

8 water conservation, water reuse, or recy9 cling; 

10 (ii) use decentralized, low-impact de11 velopment technologies and nonstructural 

12 approaches, including practices that use, 

13 enhance, or mimic the natural hydrological 

14 cycle or protect natural flows; 

15 (iii) reduce stormwater runoff by pro16 tecting or enhancing natural ecosystem 

17 functions; 

18 (iv) modify, upgrade, enhance, or re19 place existing water system infrastructure 

20 in response to ongoing or forecasted climate21 related impacts; 

22 (v) promote the sustainability and reli23 ability of water supplies used for agricul24 tural purposes; 


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1 (vi) improve water quality or quantity 

2 for agricultural and municipal uses, includ3 ing through salinity reduction; and 

4 (vii) provide multiple benefits, includ5 ing to water supply enhancement or de6 mand reduction, water quality protection or 

7 improvement, increased flood protection, 

8 and ecosystem protection or improvement; 

9 and 

10 (C) provide for solicitation and consider11 ation of public input in the development of cri12 teria used in evaluating applications. 

13 (g) COST-SHARING.— 

14 (1) FEDERAL SHARE.—The share of the cost of 

15 any program, strategy, or infrastructure improvement 

16 that is the subject of a grant awarded by a State to 

17 the owner or operator of a water system under sub18 section (c) paid through funds distributed under this 

19 section shall not exceed 50 percent of the cost of the 

20 program, strategy, and infrastructure improvement. 

21 (2) CALCULATION OF NON-FEDERAL SHARE.—In 

22 calculating the non-Federal share of the cost of a pro23 gram, strategy, or infrastructure improvement pro24 posed by a water system through an application subVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01240 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 mitted by the water system under subsection (e), the 

2 State shall— 

3 (A) include the value of any in-kind services 

4 that are integral to the completion of the pro5 gram, strategy, or infrastructure improvement, 

6 including reasonable administrative and over7 head costs; and 

8 (B) not include any other amount that the 

9 water system receives from a Federal agency. 

10 (h) LABOR STANDARDS.— 

11 (1) IN GENERAL.—Other than with respect to 

12 employees of State and local agencies, or other public 

13 entities, all laborers and mechanics employed on in14 frastructure improvements funded directly by or as15 sisted in whole or in part by this section shall be paid 

16 wages at rates not less than those prevailing for the 

17 same type of work on similar construction in the im18 mediate locality, as determined by the Secretary of 

19 Labor in accordance with subchapter IV of chapter 31 

20 of part A of subtitle II of title 40, United States Code. 

21 (2) AUTHORITY AND FUNCTIONS.—With respect 

22 to the labor standards in this subsection, the Sec23 retary of Labor shall have the authority and functions 

24 set forth in Reorganization Plan Numbered 14 of 


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1 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 3145 

2 of title 40, United States Code. 

3 SEC. 382. FLOOD CONTROL, PROTECTION, PREVENTION, 

4 AND RESPONSE. 

5 (a) ESTABLISHMENT.—The Administrator, in con6 sultation with the Assistant Secretary of the Army for Civil 

7 Works and the Administrator of the Federal Emergency 

8 Management Agency, shall establish a Flood Control, Pro9 tection, Prevention and Response Program to provide funds 

10 to States and Indian tribes for flood control, protection, pre11 vention and response projects. 

12 (b) ELIGIBLE USES.— 

13 (1) IN GENERAL.—States and Indian tribes re14 ceiving funding pursuant to this section may use such 

15 funding on flood control, protection, prevention and 

16 response programs and projects addressing the pro17 jected impacts of climate change in accordance with 

18 this section. 

19 (2) OBJECTIVES.—Such projects and activities 

20 shall seek to mitigate or adapt to the destructive im21 pacts of climate related increases in the duration, fre22 quency, or magnitude of rainfall or runoff, including 

23 snowmelt runoff, as well as hurricanes, including 

24 projects and programs that— 


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1 (A) reduce flood damage, risk, and vulner2 ability; 

3 (B) identify, maintain and restore eco4 systems and natural barriers integral to flood 

5 control, protection, prevention and response; 

6 (C) update the available data, technologies, 

7 and scientific knowledge used in estimating, 

8 identifying and mitigating flood hazards; 

9 (D) highlight, update and remediate 

10 vulnerabilities in emergency response; 

11 (E) incorporate risk analysis and a risk-re12 duction approach to flood-related investments; 

13 (F) incorporate and identify changes in risk 

14 due to processes such as land loss, subsidence, 

15 sea-level rise, reduced natural buffers, urban de16 velopment and infrastructure aging; 

17 (G) identify and incorporate innovative ap18 proaches to land use management, water resource 

19 planning, and ecosystem restoration; 

20 (H) provide for acquisition and easement of 

21 floodways and flood-prone properties in order to 

22 prevent urban areas from flooding, or move peo23 ple out of harm’s way; and 

24 (I) promote land use planning that prevents 

25 future floodplain development. 


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1 (3) PRIORITY.—Priority in projects to reduce 

2 flood events shall be given to those projects that— 

3 (A) directly assist local governments and 

4 communities in flood control, protection, preven5 tion and response activities; 

6 (B) are part of a larger State or watershed 

7 plan to reduce flood risk; 

8 (C) are specifically designed to accommo9 date forecasted climate change scenarios; 

10 (D) advance multiple objectives, including 

11 public safety, water quality, fish and wildlife 

12 conservation, water supply, and recreation; 

13 (E) protect or enhance natural ecosystem 

14 functions, including protection, maintenance, or 

15 restoration of natural infrastructure, natural 

16 buffer zones, or natural shorelines, to buffer com17 munities from floodwaters or storms, watershed 

18 protection to maintain water quality and 

19 groundwater recharge, or floodplain restoration 

20 to improve natural flood control capacity; 

21 (F) use nonstructural approaches, including 

22 practices that use, enhance, or mimic the natural 

23 hydrologic cycle; and 

24 (G) reduce the frequency and consequences 

25 of flooding in densely populated urban areas. 


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1 SEC. 383. WILDFIRE. 

2 (a) FINDINGS.—Congress finds that— 

3 (1) since 1980, wildfires in the United States 

4 have burned almost twice as many acres per year on 

5 average than the average burned acreage during the 

6 period beginning on January 1, 1920, and ending on 

7 December 31, 1979; 

8 (2) the wildfire season in the western United 

9 States has increased by an average of 78 days during 

10 the 30-year period preceding the date of enactment of 

11 this Act; 

12 (3) researchers predict that the area subject to 

13 wildfire damage will increase during the 21st century 

14 by up to 118 percent as a result of climate change; 

15 (4) of the annual budget of the Forest Service, 

16 the Forest Service used for wildfire suppression ac17 tivities— 

18 (A) 13 percent in 1991; and 

19 (B) 45 percent in 2007; and 

20 (5) 1 percent of the largest escaped fires— 

21 (A) burn 95 percent of all burned acres; and 

22 (B) consume 85 percent of all wildfire fight23 ing costs. 

24 (b) PURPOSE.—The purpose of this section is to au25 thorize a program to reduce the risk of wildfires in fire26 ready communities. 


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1 (c) DEFINITIONS.—In this section: 

2 (1) FIRE-READY COMMUNITY.—The term ‘‘fire3 ready community’’ means a community that— 

4 (A) is located within a priority area identi5 fied pursuant to subsection (d); 

6 (B) has a cooperative fire agreement that 

7 articulates the roles and responsibilities for Fed8 eral, State, and local government entities, and, 

9 where applicable, Indian tribes, in local wildfire 

10 suppression and protection; 

11 (C) has local codes that require fire-resist12 ant home design and building materials; 

13 (D) has a community wildfire protection 

14 plan (as defined in section 101 of the Healthy 

15 Forests Restoration Act of 2003 (16 U.S.C. 

16 6502)); and 

17 (E) is engaged in a successful collaborative 

18 process that includes multiple interested persons 

19 representing diverse interests and is transparent 

20 and nonexclusive, such as a resource advisory 

21 committee established under section 205 of the 

22 Secure Rural Schools and Community Self-De23 termination Act of 2000 (Public Law 106-393; 

24 16 U.S.C. 500 note). 


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1 (2) SECRETARIES.—The term ‘‘Secretaries’’ 

2 means the Secretary of Agriculture and the Secretary 

3 of the Interior. 

4 (d) FIRE RISK MAPPING.—As soon as is practicable 

5 after the date of the enactment of this Act, the Secretaries 

6 shall develop regional maps of communities most at risk 

7 of wildfire and in need of hazardous fuel treatment and 

8 maintenance. The maps shall identify priority areas for 

9 hazardous fuels reduction projects, including— 

10 (1) at-risk communities in fire-prone areas of the 

11 wildland-urban interface (as defined in section 101 of 

12 the Healthy Forests Restoration Act of 2003 (16 

13 U.S.C. 6502)); 

14 (2) watersheds and municipal drinking water 

15 sources; 

16 (3) emergency evacuation corridors; 

17 (4) electricity transmission corridors; 

18 (5) low-capacity or low-income communities; 

19 and 

20 (6) communities in fire-prone areas due to the 

21 impact of pest infestation on forest resources. 

22 (e) LOCAL WILDLAND FIREFIGHTING CAPABILITY

23 GRANTS.— 

24 (1) GRANTS AVAILABLE.—The Secretaries may 

25 provide cost-share grants to— 


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1 (A) fire-ready communities, to assist those 

2 communities in carrying out activities author3 ized by paragraph (2); and 

4 (B) communities that are not fire-ready, to 

5 assist those communities in carrying out plan6 ning activities to become fire-ready communities 

7 consistent with the requirements of this section. 

8 (2) ELIGIBLE ACTIVITIES.—Grant funds may be 

9 used for the following: 

10 (A) Education programs to raise awareness 

11 of homeowners and citizens about wildland fire 

12 protection practices, including FireWise or simi13 lar programs. 

14 (B) Training programs for local firefighters 

15 on wildland firefighting techniques and ap16 proaches. 

17 (C) Equipment acquisition to facilitate 

18 wildland fire preparedness. 

19 (D) Implementation of a community wild20 fire protection plan. 

21 (E) Forest restoration that accomplishes 

22 fuels reduction 

23 (f) WILDLAND FIRE COST-SHARE AGREEMENTS.—In 

24 developing any wildland fire cost-share agreement with a 

25 State Forester or equivalent official, the Secretaries shall, 


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1 to the maximum extent practicable, encourage the State and 

2 local communities involved to become fire-ready commu3 nities. 

4 SEC. 384. COASTAL AND GREAT LAKES STATE ADAPTATION 

5 PROGRAM. 

6 (a) FINDINGS.—Congress finds that, according to the 

7 National Ocean Economics Program, coastal and Great 

8 Lakes States account for 81.4 percent of the population of 

9 the United States and generate 83 percent of the economic 

10 output of the United States. 

11 (b) DEFINITIONS.—In this section: 

12 (1) COASTAL STATE.—The term ‘‘coastal State’’ 

13 has the meaning given the term ‘‘coastal state’’ in sec14 tion 304 of the Coastal Zone Management Act of 1972 

15 (16 U.S.C. 1453). 

16 (2) COASTAL WATERSHED.—The term ‘‘coastal 

17 watershed’’ means a geographical area drained into 

18 or contributing water to an estuarine area, an ocean, 

19 or a Great Lake, all or a portion of which is within 

20 the coastal zone (as defined in section 304 of the 

21 Coastal Zone Management Act of 1972 (16 U.S.C. 

22 1453)). 

23 (3) SHORELINE MILES.—The term ‘‘shoreline 

24 miles’’, with respect to a coastal State, means the 

25 mileage of tidal shoreline or Great Lake shoreline of 


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1 the coastal State, based on the most recently available 

2 data from or accepted by the National Ocean Service 

3 of the National Oceanic and Atmospheric Administra4 tion. 

5 (c) DISTRIBUTION.— 

6 (1) IN GENERAL.—The Administrator shall dis7 tribute, in accordance with this section, funding for 

8 coastal State adaptation under subsection (d). 

9 (2) ALLOCATION.—The funding available for al10 location under subsection (b) for a calendar year shall 

11 be distributed among coastal States, as follows: 

12 (A) 25 percent based on the proportion 

13 that— 

14 (i) the number of shoreline miles of a 

15 coastal State; bears to 

16 (ii) the total number of shoreline miles 

17 of all coastal States. 

18 (B) 25 percent based on the proportion 

19 that— 

20 (i) the population of a coastal State; 

21 bears to 

22 (ii) the total population of all coastal 

23 States. 

24 (C) 50 percent divided equally among all 

25 coastal States. 


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1 (d) USE OF FUNDING.— 

2 (1) IN GENERAL.—During any calendar year, a 

3 coastal State receiving funding under this section 

4 may use the funding only for projects and activities 

5 to plan for and address the impacts of climate change 

6 in the coastal watershed, including— 

7 (A) to address the impacts of climate change 

8 with respect to— 

9 (i) accelerated sea level rise and lake 

10 level changes; 

11 (ii) shoreline erosion; 

12 (iii) increased storm frequency or in13 tensity; 

14 (iv) changes in rainfall or other pre15 cipitation; and 

16 (v) related flooding; 

17 (B) to identify and develop plans to protect, 

18 or, as necessary or applicable, to relocate public 

19 facilities and infrastructure, coastal resources of 

20 national significance, public energy facilities, or 

21 other public water uses located in the coastal wa22 tershed that are affected by climate change, in23 cluding strategies that protect or restore natural 

24 infrastructure, if the plans— 


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1 (i) ensure full consideration and un2 dertake, to the maximum extent practicable, 

3 initiatives that— 

4 (I) protect or enhance natural eco5 system functions, including protection, 

6 maintenance, or restoration of natural 

7 infrastructure, natural buffer zones, or 

8 natural shorelines (such as wetlands, 

9 reefs, and barrier islands) to buffer 

10 communities from floodwaters or 

11 storms, watershed protection to main12 tain water quality and groundwater 

13 recharge, or floodplain restoration to 

14 improve natural flood control capacity; 

15 or 

16 (II) use nonstructural approaches, 

17 including practices that utilize, en18 hance, or mimic the natural hydrologic 

19 cycle processes of infiltration, 

20 evapotranspiration, and reuse; and 

21 (ii) are consistent with Federal con22 servation and environmental laws and, to 

23 the maximum extent practicable, avoid en24 vironmental degradation; 


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1 (C) to research and collect data using, or on 

2 matters such as— 

3 (i) historical shoreline position maps; 

4 (ii) historical shoreline erosion rates; 

5 (iii) inventories of shoreline features 

6 and conditions; 

7 (iv) acquisition of high-resolution to8 pography and bathymetry; 

9 (v) sea level rise inundation models; 

10 (vi) storm surge sea level rise linked 

11 inundation models; 

12 (vii) shoreline change modeling based 

13 on sea level rise projections; 

14 (viii) sea level rise vulnerability anal15 yses and socioeconomic studies; and 

16 (ix) environmental and habitat 

17 changes associated with sea level rise; and 

18 (D) to respond to— 

19 (i) changes in chemical characteristics 

20 (including ocean acidification) and phys21 ical characteristics (including thermal 

22 stratification) of marine systems; 

23 (ii) sea level rise threats to ground24 water aquifers, including— 

25 (I) saltwater intrusion; and 


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1 (II) unsaturated zone thinning; 

2 (iii) increased harmful algae blooms; 

3 (iv) spread of invasive species; 

4 (v) coastal habitat loss; 

5 (vi) species migrations; and 

6 (vii) marine, estuarine, and freshwater 

7 ecosystem changes associated with climate 

8 change. 

9 (2) EXECUTION.—Priority to plan and carry out 

10 projects and activities under this subsection shall be 

11 given to State coastal agencies, as determined in ac12 cordance with State law. 

13 (3) COORDINATION.—In carrying out this sub14 section, a coastal State shall coordinate with other 

15 statewide or tribal climate change efforts and climate 

16 change efforts to promote cooperation and in order to 

17 avoid duplication of such efforts. 

18 (e) REPORT.—Not later than 1 year after the date on 

19 which a State receives funds under this section, and bienni20 ally thereafter until such time as the funding is fully ex21 pended, the State shall submit to the Administrator, or the 

22 heads of such other Federal agencies as the President may 

23 designate, a report that— 


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1 (1) provides a full accounting for the State’s use 

2 of funding distributed under this section, including a 

3 description of the projects and activities funded; 

4 (2) may be independent or included within any 

5 report required for any State programs for greenhouse 

6 gas reduction and climate adaptation; and 

7 (3) is available to the public on request. 

8 DIVISION B—POLLUTION 

9 REDUCTION AND INVESTMENT 

10 TITLE I—REDUCING GLOBAL 

11 WARMING POLLUTION 

12 Subtitle A—Reducing Global 

13 Warming Pollution 

14 SEC. 101. REDUCING GLOBAL WARMING POLLUTION. 

15 The Clean Air Act is amended by adding after title 

16 VI (42 U.S.C. 7671 et seq.) the following: 

17 ‘‘TITLE VII—GLOBAL WARMING 

18 POLLUTION REDUCTION AND 

19 INVESTMENT PROGRAM 

20 ‘‘PART A—GLOBAL WARMING POLLUTION 

21 REDUCTION GOALS AND TARGETS 

22 ‘‘SEC. 701. FINDINGS. 

23 ‘‘Congress finds that— 

24 ‘‘(1) global warming poses a significant threat to 

25 the national security, economy, public health and welVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01255 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 fare, and environment of the United States, as well 

2 as of other countries; 

3 ‘‘(2) reviews of scientific studies, including by 

4 the Intergovernmental Panel on Climate Change and 

5 the National Academy of Sciences, demonstrate that 

6 global warming is the result of the combined anthro7 pogenic greenhouse gas emissions from numerous 

8 sources of all types and sizes; 

9 ‘‘(3) each increment of emission, when combined 

10 with other emissions, causes or contributes materially 

11 to the acceleration and extent of global warming and 

12 its adverse effects for the lifetime of such gas in the 

13 atmosphere; 

14 ‘‘(4) accordingly, controlling emissions in small 

15 as well as large quantities is essential to prevent, slow 

16 the pace of, reduce the threats from, and mitigate 

17 global warming and its adverse effects; 

18 ‘‘(5) because they induce global warming, green19 house gas emissions cause or contribute to injuries to 

20 persons in the United States, including— 

21 ‘‘(A) adverse health effects, such as disease 

22 and loss of life; 

23 ‘‘(B) displacement of human populations; 


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1 ‘‘(C) damage to property and other interests 

2 relating to ocean levels, acidification, and ice 

3 changes; 

4 ‘‘(D) severe weather and seasonal changes; 

5 ‘‘(E) disruption, costs, and losses to busi6 ness, trade, employment, farms, subsistence, aes7 thetic enjoyment of the environment, recreation, 

8 culture, and tourism; 

9 ‘‘(F) damage to plants, forests, lands, and 

10 waters; 

11 ‘‘(G) harm to wildlife and habitat; 

12 ‘‘(H) scarcity of water and the decreased 

13 abundance of other natural resources; 

14 ‘‘(I) worsening of tropospheric air pollution; 

15 ‘‘(J) substantial threats of similar damage; 

16 and 

17 ‘‘(K) other harm; 

18 ‘‘(6) the fact that many of those effects and risks 

19 of future effects of global warming are widely shared 

20 does not minimize the adverse effects individual per21 sons have suffered, will suffer, and are at risk of suf22 fering because of global warming; 

23 ‘‘(7) the fact that some of the adverse and poten24 tially catastrophic effects of global warming are at 

25 risk of occurring and not a certainty does not negate 


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1 the harm persons suffer from actions that increase the 

2 likelihood, extent, and severity of such future impacts; 

3 ‘‘(8) countries of the world look to the United 

4 States for leadership in addressing the threat of and 

5 harm from global warming; 

6 ‘‘(9) full implementation of this title is critical 

7 to engage other countries in an international effort to 

8 mitigate the threat of and harm from global warming; 

9 and 

10 ‘‘(10) global warming and its adverse effects are 

11 occurring and are likely to continue and increase in 

12 magnitude, and to do so at a greater and more harm13 ful rate, unless the this title is fully implemented and 

14 enforced in an expeditious manner. 

15 ‘‘SEC. 702. ECONOMYWIDE REDUCTION GOALS. 

16 ‘‘The goals of this title, and the Clean Energy Jobs 

17 and American Power Act (and the amendments made by 

18 that Act), are to reduce steadily the quantity of United 

19 States greenhouse gas emissions such that— 

20 ‘‘(1) in 2012, the quantity of United States 

21 greenhouse gas emissions does not exceed 97 percent 

22 of the quantity of United States greenhouse gas emis23 sions in 2005; 

24 ‘‘(2) in 2020, the quantity of United States 

25 greenhouse gas emissions does not exceed 80 percent 


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1 of the quantity of United States greenhouse gas emis2 sions in 2005; 

3 ‘‘(3) in 2030, the quantity of United States 

4 greenhouse gas emissions does not exceed 58 percent 

5 of the quantity of United States greenhouse gas emis6 sions in 2005; and 

7 ‘‘(4) in 2050, the quantity of United States 

8 greenhouse gas emissions does not exceed 17 percent 

9 of the quantity of United States greenhouse gas emis10 sions in 2005. 

11 ‘‘SEC. 703. REDUCTION TARGETS FOR SPECIFIED SOURCES. 

12 ‘‘(a) IN GENERAL.—The regulations issued under sec13 tion 721 shall limit and reduce annually the greenhouse gas 

14 emissions of capped sources each calendar year beginning 

15 in 2012 such that— 

16 ‘‘(1) in 2012, the quantity of greenhouse gas 

17 emissions from capped sources does not exceed 97 per18 cent of the quantity of greenhouse gas emissions from 

19 such sources in 2005; 

20 ‘‘(2) in 2020, the quantity of greenhouse gas 

21 emissions from capped sources does not exceed 80 per22 cent of the quantity of greenhouse gas emissions from 

23 such sources in 2005; 

24 ‘‘(3) in 2030, the quantity of greenhouse gas 

25 emissions from capped sources does not exceed 58 perVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01259 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 cent of the quantity of greenhouse gas emissions from 

2 such sources in 2005; and 

3 ‘‘(4) in 2050, the quantity of greenhouse gas 

4 emissions from capped sources does not exceed 17 per5 cent of the quantity of greenhouse gas emissions from 

6 such sources in 2005. 

7 ‘‘(b) DEFINITION OF GREENHOUSE GAS EMISSIONS

8 FROM SUCH SOURCES IN 2005.—For purposes of this sec9 tion, the term ‘greenhouse gas emissions from such sources 

10 in 2005’ means emissions to which section 722 would have 

11 applied if the requirements of this title for the specified year 

12 had been in effect for 2005. 

13 ‘‘SEC. 704. SUPPLEMENTAL POLLUTION REDUCTIONS. 

14 ‘‘For the purposes of decreasing the likelihood of cata15 strophic climate change, preserving tropical forests, build16 ing capacity to generate offset credits, and facilitating 

17 international action on global warming, the Administrator 

18 shall set aside a percentage specified in section 771(c) of 

19 the quantity of emission allowances established under sec20 tion 721(a) for each year, to be used to achieve a reduction 

21 of greenhouse gas emissions from deforestation in developing 

22 countries in accordance with part E. In 2020, activities 

23 supported under part E shall provide greenhouse gas reduc24 tions in an amount equal to an additional 10 percentage 

25 points of reductions from United States greenhouse gas 


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1 emissions in 2005. The Administrator shall distribute these 

2 allowances with respect to activities in countries that enter 

3 into and implement agreements or arrangements relating 

4 to reduced deforestation as described in section 753(a)(2). 

5 ‘‘SEC. 705. REVIEW AND PROGRAM RECOMMENDATIONS. 

6 ‘‘(a) IN GENERAL.—The Administrator shall, in con7 sultation with appropriate Federal agencies, submit to Con8 gress a report not later than July 1, 2013, and every 4 

9 years thereafter, that includes— 

10 ‘‘(1) an analysis of key findings based on up-to11 date scientific information and data relevant to glob12 al climate change; 

13 ‘‘(2) an analysis of capabilities to monitor and 

14 verify greenhouse gas reductions on a worldwide 

15 basis, including for the United States, as required 

16 under the Clean Energy Jobs and American Power 

17 Act (and the amendments made by that Act); 

18 ‘‘(3) an analysis of the status of worldwide 

19 greenhouse gas reduction efforts, including implemen20 tation of the Clean Energy Jobs and American Power 

21 Act and other policies, both domestic and inter22 national, for reducing greenhouse gas emissions, pre23 venting dangerous atmospheric concentrations of 

24 greenhouse gases, preventing significant irreversible 


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1 consequences of climate change, and reducing vulner2 ability to the impacts of climate change; and 

3 ‘‘(4) an analysis, to be conducted by the Sec4 retary of Energy in accordance with subsection (f) 

5 and submitted to the Administrator for inclusion in 

6 each report under this subsection, of the technological 

7 feasibility of achieving additional reductions in 

8 greenhouse gas emissions. 

9 ‘‘(b) EXCEPTION.—Subsection (a)(3) shall not apply 

10 to the first report submitted under subsection (a). 

11 ‘‘(c) LATEST SCIENTIFIC INFORMATION.—The analysis 

12 required under subsection (a)(1) shall— 

13 ‘‘(1) address existing scientific information and 

14 reports, considering, to the greatest extent possible, the 

15 most recent assessment report of the Intergovern16 mental Panel on Climate Change, reports by the 

17 United States Global Change Research Program, the 

18 Natural Resources Climate Change Adaptation Panel 

19 established under section 365 of the Clean Energy 

20 Jobs and American Power Act, and Federal agencies, 

21 and the European Union’s global temperature data 

22 assessment; 

23 ‘‘(2) review trends and projections for— 

24 ‘‘(A) global and country-specific annual 

25 emissions of greenhouse gases, and cumulative 


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1 greenhouse gas emissions produced between 1850 

2 and the present, including— 

3 ‘‘(i) global cumulative emissions of an4 thropogenic greenhouse gases; 

5 ‘‘(ii) global annual emissions of an6 thropogenic greenhouse gases; and 

7 ‘‘(iii) by country, annual total, annual 

8 per capita, and cumulative anthropogenic 

9 emissions of greenhouse gases for the top 50 

10 emitting nations; 

11 ‘‘(B) significant changes, both globally and 

12 by region, in annual net non-anthropogenic 

13 greenhouse gas emissions from natural sources, 

14 including permafrost, forests, or oceans; 

15 ‘‘(C) global atmospheric concentrations of 

16 greenhouse gases, expressed in annual concentra17 tion units as well as carbon dioxide equivalents 

18 based on 100-year global warming potentials; 

19 ‘‘(D) major climate forcing factors, such as 

20 aerosols; 

21 ‘‘(E) global average temperature, expressed 

22 as seasonal and annual averages in land, ocean, 

23 and land-plus-ocean averages; and 

24 ‘‘(F) sea level rise; 


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1 ‘‘(3) assess the current and potential impacts of 

2 global climate change on— 

3 ‘‘(A) human populations, including impacts 

4 on public health, economic livelihoods, subsist5 ence, tribal culture, human infrastructure, and 

6 displacement or permanent relocation due to 

7 flooding, severe weather, extended drought, ero8 sion, or other ecosystem changes; 

9 ‘‘(B) freshwater systems, including water 

10 resources for human consumption and agri11 culture and natural and managed ecosystems, 

12 flood and drought risks, and relative humidity; 

13 ‘‘(C) the carbon cycle, including impacts re14 lated to the thawing of permafrost, the frequency 

15 and intensity of wildfire, and terrestrial and 

16 ocean carbon sinks; 

17 ‘‘(D) ecosystems and animal and plant pop18 ulations, including impacts on species abun19 dance, phenology, and distribution; 

20 ‘‘(E) oceans and ocean ecosystems, includ21 ing effects on sea level, ocean acidity, ocean tem22 peratures, coral reefs, ocean circulation, fisheries, 

23 and other indicators of ocean ecosystem health; 


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1 ‘‘(F) the cryosphere, including effects on ice 

2 sheet mass balance, mountain glacier mass bal3 ance, and sea-ice extent and volume; 

4 ‘‘(G) changes in the intensity, frequency, or 

5 distribution of severe weather events, including 

6 precipitation, tropical cyclones, tornadoes, and 

7 severe heat waves; 

8 ‘‘(H) agriculture and forest systems; and 

9 ‘‘(I) any other indicators the Administrator 

10 deems appropriate; 

11 ‘‘(4) summarize any significant socioeconomic 

12 impacts of climate change in the United States, in13 cluding the territories of the United States, drawing 

14 on work by Federal agencies and the academic lit15 erature, including impacts on— 

16 ‘‘(A) public health; 

17 ‘‘(B) economic livelihoods, subsistence, and 

18 tribal culture; 

19 ‘‘(C) displacement or permanent relocation 

20 due to flooding, severe weather, extended drought, 

21 or other ecosystem changes; 

22 ‘‘(D) human infrastructure, including coast23 al infrastructure vulnerability to extreme events 

24 and sea level rise, river floodplain infrastructure, 

25 and sewer and water management systems; 


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1 ‘‘(E) agriculture and forests, including ef2 fects on potential growing season, distribution, 

3 and yield; 

4 ‘‘(F) water resources for human consump5 tion, agriculture and natural and managed eco6 systems, flood and drought risks, and relative hu7 midity; 

8 ‘‘(G) energy supply and use; and 

9 ‘‘(H) transportation; 

10 ‘‘(5) in assessing risks and impacts, use a risk 

11 management framework, including both qualitative 

12 and quantitative measures, to assess the observed and 

13 projected impacts of current and future climate 

14 change, accounting for— 

15 ‘‘(A) both monetized and non-monetized 

16 losses; 

17 ‘‘(B) potential nonlinear, abrupt, or essen18 tially irreversible changes in the climate system; 

19 ‘‘(C) potential nonlinear increases in the 

20 cost of impacts; 

21 ‘‘(D) potential low-probability, high impact 

22 events; and 

23 ‘‘(E) whether impacts are transitory or es24 sentially permanent; and 


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1 ‘‘(6) based on the findings of the Administrator 

2 under this section, as well as assessments produced by 

3 the Intergovernmental Panel on Climate Change, the 

4 United States Global Change Research program, and 

5 other relevant scientific entities— 

6 ‘‘(A) describe increased risks to natural sys7 tems and society that would result from an in8 crease in global average temperature 3.6 degrees 

9 Fahrenheit (2 degrees Celsius) above the pre-in10 dustrial average or an increase in atmospheric 

11 greenhouse gas concentrations above 450 parts 

12 per million carbon dioxide equivalent; and 

13 ‘‘(B) identify and assess— 

14 ‘‘(i) significant residual risks not 

15 avoided by the thresholds described in sub16 paragraph (A); 

17 ‘‘(ii) alternative thresholds or targets 

18 that may more effectively limit the risks 

19 identified pursuant to clause (i); and 

20 ‘‘(iii) thresholds above those described 

21 in subparagraph (A) which significantly in22 crease the risk of certain impacts or render 

23 them essentially permanent. 

24 ‘‘(d) STATUS OF MONITORING AND VERIFICATION CA25 PABILITIES TO EVALUATE GREENHOUSE GAS REDUCTION


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1 EFFORTS.—The analysis required under subsection (a)(2) 

2 shall evaluate the capabilities of the monitoring, reporting, 

3 and verification systems used to quantify progress in 

4 achieving reductions in greenhouse gas emissions both glob5 ally and in the United States (as described in section 702), 

6 including— 

7 ‘‘(1) quantification of emissions and emission re8 ductions by entities participating in the pollution re9 duction and investment program under this title; 

10 ‘‘(2) quantification of emissions and emission re11 ductions by entities participating in the offset pro12 gram under this title; 

13 ‘‘(3) quantification of emission and emission re14 ductions by entities regulated by performance stand15 ards; 

16 ‘‘(4) quantification of aggregate net emissions 

17 and emission reductions by the United States; and 

18 ‘‘(5) quantification of global changes in net emis19 sions and in sources and sinks of greenhouse gases. 

20 ‘‘(e) STATUS OF GREENHOUSE GAS REDUCTION EF21 FORTS.—The analysis required under subsection (a)(3) 

22 shall address— 

23 ‘‘(1) whether the programs under the Clean En24 ergy Jobs and American Power Act (and the amend25 ments made by that Act) and other Federal statutes 


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1 are resulting in sufficient United States greenhouse 

2 gas emission reductions to meet the emissions reduc3 tion goals described in section 702, taking into ac4 count the use of offsets; and 

5 ‘‘(2) whether United States actions, taking into 

6 account international actions, commitments, and 

7 trends, and considering the range of plausible emis8 sions scenarios, are sufficient to avoid— 

9 ‘‘(A) atmospheric greenhouse gas concentra10 tions above 450 parts per million carbon dioxide 

11 equivalent; 

12 ‘‘(B) global average surface temperature 3.6 

13 degrees Fahrenheit (2 degrees Celsius) above the 

14 pre-industrial average, or such other temperature 

15 thresholds as the Administrator deems appro16 priate; and 

17 ‘‘(C) other temperature or greenhouse gas 

18 thresholds identified pursuant to subsection 

19 (c)(6)(B). 

20 ‘‘(f) TECHNOLOGICAL INFORMATION.—The analysis re21 quired under subsection (a)(4) shall— 

22 ‘‘(1) review existing technological information 

23 and reports, including the most recent reports by the 

24 Department of Energy, the United States Global 

25 Change Research Program, the Intergovernmental 


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1 Panel on Climate Change, and the International En2 ergy Agency, and any other relevant information on 

3 technologies or practices that reduce or limit green4 house gas emissions; 

5 ‘‘(2) include the participation of technical ex6 perts from relevant private industry sectors; 

7 ‘‘(3) review the current and future projected de8 ployment of technologies and practices in the United 

9 States that reduce or limit greenhouse gas emissions, 

10 including— 

11 ‘‘(A) technologies for capture and sequestra12 tion of greenhouse gases; 

13 ‘‘(B) technologies to improve energy effi14 ciency; 

15 ‘‘(C) low- or zero-greenhouse gas emitting 

16 energy technologies; 

17 ‘‘(D) low- or zero-greenhouse gas emitting 

18 fuels; 

19 ‘‘(E) biological sequestration practices and 

20 technologies; and 

21 ‘‘(F) any other technologies the Secretary 

22 determines to be relevant; and 

23 ‘‘(4) review and compare the emission reduction 

24 potential, commercial viability, market penetration, 


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1 investment trends, and deployment of the technologies 

2 described in paragraph (3), including— 

3 ‘‘(A) the need for additional research and 

4 development, including publicly funded research 

5 and development; 

6 ‘‘(B) the extent of commercial deployment, 

7 including, where appropriate, a comparison to 

8 the cost and level of deployment of conventional 

9 fossil fuel-fired energy technologies and devices; 

10 and 

11 ‘‘(C) an evaluation of any substantial tech12 nological, legal, or market-based barriers to com13 mercial deployment. 

14 ‘‘(g) RECOMMENDATIONS.— 

15 ‘‘(1) LATEST SCIENTIFIC INFORMATION.—Based 

16 on the analysis described in subsection (a)(1), each re17 port under subsection (a) shall identify actions that 

18 could be taken to— 

19 ‘‘(A) improve the characterization of 

20 changes in the earth-climate system and impacts 

21 of global climate change; 

22 ‘‘(B) better inform decision making and ac23 tions related to global climate change; 

24 ‘‘(C) mitigate risks to natural and social 

25 systems; and 


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1 ‘‘(D) design policies to better account for 

2 climate risks. 

3 ‘‘(2) MONITORING, REPORTING AND

4 VERIFICATION.—Based on the analysis described in 

5 subsection (a)(2), each report under subsection (a) 

6 shall identify key gaps in measurement, reporting, 

7 and verification capabilities and make recommenda8 tions to improve the accuracy and reliability of those 

9 capabilities. 

10 ‘‘(3) STATUS OF GREENHOUSE GAS REDUCTION

11 EFFORTS.—Based on the analysis described in sub12 section (a)(3), taking into account international ac13 tions, commitments, and trends, and considering the 

14 range of plausible emissions scenarios, each report 

15 under subsection (a) shall identify— 

16 ‘‘(A) the quantity of additional reductions 

17 required to meet the emissions reduction goals in 

18 section 702; 

19 ‘‘(B) the quantity of additional reductions 

20 in global greenhouse gas emissions needed to 

21 avoid the concentration and temperature thresh22 olds identified in subsection (e); and 

23 ‘‘(C) possible strategies and approaches for 

24 achieving additional reductions. 


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1 ‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There 

2 are authorized to be appropriated to carry out this section 

3 such sums as may be necessary. 

4 ‘‘SEC. 706. NATIONAL ACADEMY REVIEW. 

5 ‘‘(a) IN GENERAL.—Not later than 1 year after the 

6 date of enactment of this title, the Administrator shall offer 

7 to enter into a contract with the National Academy of 

8 Sciences (in this section referred to as the ‘Academy’) under 

9 which the Academy shall, not later than July 1, 2014, and 

10 every 4 years thereafter, submit to Congress and the Admin11 istrator a report that includes— 

12 ‘‘(1) a review of the most recent report and rec13 ommendations issued under section 705; and 

14 ‘‘(2) an analysis of technologies to achieve reduc15 tions in greenhouse gas emissions. 

16 ‘‘(b) FAILURE TO ISSUE A REPORT.—In the event that 

17 the Administrator has not issued all or part of the most 

18 recent report required under section 705, the Academy shall 

19 conduct its own review and analysis of the required infor20 mation. 

21 ‘‘(c) RECOMMENDATIONS.— 

22 ‘‘(1) LATEST SCIENTIFIC INFORMATION.—Based 

23 on the review described in subsection (a)(1), the Acad24 emy shall identify actions that could be taken to— 


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1 ‘‘(A) improve the characterization of 

2 changes in the earth-climate system and impacts 

3 of global climate change; 

4 ‘‘(B) better inform decision making and ac5 tions related to global climate change; 

6 ‘‘(C) mitigate risks to natural and social 

7 systems; 

8 ‘‘(D) design policies to better account for 

9 climate risks; and 

10 ‘‘(E) improve the accuracy and reliability 

11 of capabilities to monitor, report, and verify 

12 greenhouse gas emissions reduction efforts. 

13 ‘‘(2) TECHNOLOGICAL INFORMATION.—Based on 

14 the analysis described in subsection (a)(2), the Acad15 emy shall identify— 

16 ‘‘(A) additional emission reductions that 

17 may be possible as a result of technologies de18 scribed in the analysis; 

19 ‘‘(B) barriers to the deployment of such 

20 technologies; and 

21 ‘‘(C) actions that could be taken to speed de22 ployment of such technologies. 

23 ‘‘(3) STATUS OF GREENHOUSE GAS REDUCTION

24 EFFORTS.—Based on the review described in sub25 section (a)(1), the Academy shall identify— 


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1 ‘‘(A) the quantity of additional reductions 

2 required to meet the emissions reduction goals 

3 described in section 702; and 

4 ‘‘(B) the quantity of additional reductions 

5 in global greenhouse gas emissions needed to 

6 avoid the concentration and temperature thresh7 olds described in section 705(c)(6)(A) or identi8 fied pursuant to section 705(c)(6)(B). 

9 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 

10 are authorized to be appropriated to carry out this section 

11 such sums as may be necessary. 

12 ‘‘SEC. 707. PRESIDENTIAL RESPONSE AND RECOMMENDA13 TIONS. 

14 ‘‘Not later than July 1, 2015, and every 4 years there15 after— 

16 ‘‘(1) the President shall direct relevant Federal 

17 agencies to use existing statutory authority to take 

18 appropriate actions identified in the reports sub19 mitted under sections 705 and 706 and to address 

20 any shortfalls identified in such reports; and 

21 ‘‘(2) in the event that the National Academy of 

22 Sciences has concluded, in the most recent report sub23 mitted under section 706, that the United States will 

24 not achieve the necessary domestic greenhouse gas 

25 emission reductions, or that global actions will not 


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1 maintain safe global average surface temperature and 

2 atmospheric greenhouse gas concentration thresholds, 

3 the President shall submit to Congress a plan identi4 fying domestic and international actions that will 

5 achieve necessary additional greenhouse gas reduc6 tions, including any recommendations for legislative 

7 action. 

8 ‘‘SEC. 708. CONSULTATION WITH STATES. 

9 ‘‘In the development of any regulations required to im10 plement the global warming pollution and reduction invest11 ment program pursuant to this title, and in the implemen12 tation of that program, the Administrator shall consult 

13 with the States in the Regional Greenhouse Gas Initiative, 

14 the Western Climate Initiative, and the Mid-West Governors 

15 Accord. 

16 ‘‘PART B—DESIGNATION AND REGISTRATION OF 

17 GREENHOUSE GASES 

18 ‘‘SEC. 711. DESIGNATION OF GREENHOUSE GASES. 

19 ‘‘(a) GREENHOUSE GASES.—For purposes of this title, 

20 the following are greenhouse gases: 

21 ‘‘(1) Carbon dioxide. 

22 ‘‘(2) Methane. 

23 ‘‘(3) Nitrous oxide. 

24 ‘‘(4) Sulfur hexafluoride. 


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1 ‘‘(5) Hydrofluorocarbons from a chemical manu2 facturing process at an industrial stationary source. 

3 ‘‘(6) Any perfluorocarbon that is an anthropo4 genic gas 1 metric ton of which makes the same or 

5 greater contribution to global warming over 100 years 

6 as 1 metric ton of carbon dioxide. 

7 ‘‘(7) Nitrogen trifluoride. 

8 ‘‘(8) Any other anthropogenic gas designated as 

9 a greenhouse gas by the Administrator under this sec10 tion. 

11 ‘‘(b) DETERMINATION ON ADMINISTRATOR’S INITIA12 TIVE.—The Administrator shall, by rule— 

13 ‘‘(1) determine whether 1 metric ton of another 

14 anthropogenic gas makes the same or greater con15 tribution to global warming over 100 years as 1 met16 ric ton of carbon dioxide; 

17 ‘‘(2) determine the carbon dioxide equivalent 

18 value for each gas with respect to which the Adminis19 trator makes an affirmative determination under 

20 paragraph (1); 

21 ‘‘(3) for each gas with respect to which the Ad22 ministrator makes an affirmative determination 

23 under paragraph (1) and that is used as a substitute 

24 for a class I or class II substance under title VI, de25 termine the extent to which to regulate that gas under 


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1 section 619 and specify appropriate compliance obli2 gations under section 619; 

3 ‘‘(4) designate as a greenhouse gas for purposes 

4 of this title each gas for which the Administrator 

5 makes an affirmative determination under paragraph 

6 (1), to the extent that it is not regulated under section 

7 619; and 

8 ‘‘(5) specify the appropriate compliance obliga9 tions under this title for each gas designated as a 

10 greenhouse gas under paragraph (4). 

11 ‘‘(c) PETITIONS TO DESIGNATE A GREENHOUSE

12 GAS.— 

13 ‘‘(1) IN GENERAL.—Any person may petition the 

14 Administrator to designate as a greenhouse gas any 

15 anthropogenic gas 1 metric ton of which makes the 

16 same or greater contribution to global warming over 

17 100 years as 1 metric ton of carbon dioxide. 

18 ‘‘(2) CONTENTS OF PETITION.—The petitioner 

19 shall provide sufficient data, as specified by rule by 

20 the Administrator, to demonstrate that the gas is like21 ly to be a greenhouse gas and is likely to be produced, 

22 imported, used, or emitted in the United States. To 

23 the extent practicable, the petitioner shall also iden24 tify producers, importers, distributors, users, and 

25 emitters of the gas in the United States. 


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1 ‘‘(3) REVIEW AND ACTION BY THE ADMINIS2 TRATOR.—Not later than 90 days after receipt of a 

3 petition under paragraph (2), the Administrator shall 

4 determine whether the petition is complete and notify 

5 the petitioner and the public of the decision. 

6 ‘‘(4) ADDITIONAL INFORMATION.—The Adminis7 trator may require producers, importers, distributors, 

8 users, or emitters of the gas to provide information on 

9 the contribution of the gas to global warming over 

10 100 years compared to carbon dioxide. 

11 ‘‘(5) TREATMENT OF PETITION.—For any sub12 stance used as a substitute for a class I or class II 

13 substance under title VI, the Administrator may elect 

14 to treat a petition under this subsection as a petition 

15 to list the substance as a class II, group II substance 

16 under section 619, and may require the petition to be 

17 amended to address listing criteria promulgated 

18 under that section. 

19 ‘‘(6) DETERMINATION.—Not later than 2 years 

20 after receipt of a complete petition, the Administrator 

21 shall, after notice and an opportunity for comment— 

22 ‘‘(A) issue and publish in the Federal Reg23 ister— 

24 ‘‘(i) a determination that 1 metric ton 

25 of the gas does not make a contribution to 


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1 global warming over 100 years that is equal 

2 to or greater than that made by 1 metric 

3 ton of carbon dioxide; and 

4 ‘‘(ii) an explanation of the decision; or 

5 ‘‘(B) determine that 1 metric ton of the gas 

6 makes a contribution to global warming over 100 

7 years that is equal to or greater than that made 

8 by 1 metric ton of carbon dioxide, and take the 

9 actions described in subsection (b) with respect 

10 to such gas. 

11 ‘‘(7) GROUNDS FOR DENIAL.—The Administrator 

12 may not deny a petition under this subsection solely 

13 on the basis of inadequate Environmental Protection 

14 Agency resources or time for review. 

15 ‘‘(d) SCIENCE ADVISORY BOARD CONSULTATION.— 

16 ‘‘(1) CONSULTATION.—The Administrator 

17 shall— 

18 ‘‘(A) give notice to the Science Advisory 

19 Board prior to making a determination under 

20 subsection (b)(1), (c)(6), or (e)(2)(B); 

21 ‘‘(B) consider the written recommendations 

22 of the Science Advisory Board under paragraph 

23 (2) regarding the determination; and 

24 ‘‘(C) consult with the Science Advisory 

25 Board regarding such determination, including 


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1 consultation subsequent to receipt of such written 

2 recommendations. 

3 ‘‘(2) FORMULATION OF RECOMMENDATIONS.— 

4 Upon receipt of notice under paragraph (1)(A) re5 garding a pending determination under subsection 

6 (b)(1), (c)(6), or (e)(2)(B), the Science Advisory 

7 Board shall— 

8 ‘‘(A) formulate recommendations regarding 

9 such determination, subject to a peer review 

10 process; and 

11 ‘‘(B) submit such recommendations in writ12 ing to the Administrator. 

13 ‘‘(e) MANUFACTURING AND EMISSION NOTICES.— 

14 ‘‘(1) NOTICE REQUIREMENT.— 

15 ‘‘(A) IN GENERAL.—Effective 24 months 

16 after the date of enactment of this title, no per17 son may manufacture or introduce into inter18 state commerce a fluorinated gas, or emit in a 

19 calendar year a significant quantity, as deter20 mined by the Administrator (which in no case 

shall be less than 1 21 ⁄2 ton of such fluorinated gas), 

22 of any fluorinated gas that is generated as a by23 product during the production or use of another 

24 fluorinated gas, unless— 


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1 ‘‘(i) the gas is designated as a green2 house gas under this section or is an ozone3 depleting substance listed as a class I or 

4 class II substance under title VI; 

5 ‘‘(ii) the Administrator has determined 

6 that 1 metric ton of such gas does not make 

7 a contribution to global warming that is 

8 equal to or greater than that made by 1 

9 metric ton of carbon dioxide; or 

10 ‘‘(iii) the person manufacturing or im11 porting the gas for distribution into inter12 state commerce, or emitting the gas, has 

13 submitted to the Administrator, at least 90 

14 days before the start of such manufacture, 

15 introduction into commerce, or emission, a 

16 notice of such person’s manufacture, intro17 duction into commerce, or emission of such 

18 gas, and the Administrator has not deter19 mined that notice or a substantially similar 

20 notice is incomplete. 

21 ‘‘(B) ALTERNATIVE COMPLIANCE.—For a 

22 gas that is a substitute for a class I or class II 

23 substance under title VI and either has been list24 ed as acceptable for use under section 612 or is 

25 currently subject to evaluation under section 612, 


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1 the Administrator may accept the notice and in2 formation provided pursuant to that section as 

3 fulfilling the obligation under clause (iii) of sub4 paragraph (A). 

5 ‘‘(2) REVIEW AND ACTION BY THE ADMINIS6 TRATOR.— 

7 ‘‘(A) COMPLETENESS.—Not later than 90 

8 days after receipt of notice under paragraph 

9 (1)(A)(iii) or (B), the Administrator shall deter10 mine whether the notice is complete. 

11 ‘‘(B) DETERMINATION.—If the Adminis12 trator determines that the notice is complete, the 

13 Administrator shall, after notice and an oppor14 tunity for comment, not later than 12 months 

15 after receipt of the notice— 

16 ‘‘(i) issue and publish in the Federal 

17 Register a determination that 1 metric ton 

18 of the gas does not make a contribution to 

19 global warming over 100 years that is equal 

20 to or greater than that made by 1 metric 

21 ton of carbon dioxide and an explanation of 

22 the decision; or 

23 ‘‘(ii) determine that 1 metric ton of the 

24 gas makes a contribution to global warming 

25 over 100 years that is equal to or greater 


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1 than that made by 1 metric ton of carbon 

2 dioxide, and take the actions described in 

3 subsection (b) with respect to such gas. 

4 ‘‘(f) REGULATIONS.—Not later than one year after the 

5 date of enactment of this title, the Administrator shall pro6 mulgate regulations to carry out this section. Such regula7 tions shall include— 

8 ‘‘(1) requirements for the contents of a petition 

9 submitted under subsection (c); 

10 ‘‘(2) requirements for the contents of a notice re11 quired under subsection (e); and 

12 ‘‘(3) methods and standards for evaluating the 

13 carbon dioxide equivalent value of a gas. 

14 ‘‘(g) GASES REGULATED UNDER TITLE VI.—The Ad15 ministrator shall not designate a gas as a greenhouse gas 

16 under this section to the extent that the gas is regulated 

17 under title VI. 

18 ‘‘(h) SAVINGS CLAUSE.—Nothing in this section shall 

19 be interpreted to relieve any person from complying with 

20 the requirements of section 612. 

21 ‘‘SEC. 712. CARBON DIOXIDE EQUIVALENT VALUE OF 

22 GREENHOUSE GASES. 

23 ‘‘(a) MEASURE OF QUANTITY OF GREENHOUSE

24 GASES.—Any provision of this title or title VIII that refers 

25 to a quantity or percentage of a quantity of greenhouse 


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1 gases shall mean the quantity or percentage of the green2 house gases expressed in carbon dioxide equivalents. 

3 ‘‘(b) INITIAL VALUE.—Except as provided by the Ad4 ministrator under this section or section 711— 

5 ‘‘(1) the carbon dioxide equivalent value of 

6 greenhouse gases for purposes of this Act shall be as 

7 follows: 

‘‘ CARBON DIOXIDE EQUIVALENT OF 1 TON OF LISTED 

GREENHOUSE GASES 

Greenhouse gas (1 metric ton) Carbon dioxide equivalent 

(metric tons) 

Carbon dioxide 1 

Methane 25 

Nitrous oxide 298 

HFC-23 14,800 

HFC-125 3,500 

HFC-134a 1,430 

HFC-143a 4,470 

HFC-152a 124 

HFC-227ea 3,220 

HFC-236fa 9,810 

HFC-4310mee 1,640 

CF4 7,390 

C2F6 12,200 

C4F10 8,860 

C6F14 9,300 

SF6 22,800 

NF3 17,200 


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1 ; and 

2 ‘‘(2) the carbon dioxide equivalent value for pur3 poses of this Act for any greenhouse gas not listed in 

4 the table under paragraph (1) shall be the 100-year 

5 Global Warming Potentials provided in the Intergov6 ernmental Panel on Climate Change Fourth Assess7 ment Report. 

8 ‘‘(c) PERIODIC REVIEW.— 

9 ‘‘(1) Not later than February 1, 2017, and (ex10 cept as provided in paragraph (3)) not less than 

11 every 5 years thereafter, the Administrator shall— 

12 ‘‘(A) review and, if appropriate, revise the 

13 carbon dioxide equivalent values established 

14 under this section or section 711(b)(2), based on 

15 a determination of the number of metric tons of 

16 carbon dioxide that makes the same contribution 

17 to global warming over 100 years as 1 metric 

18 ton of each greenhouse gas; and 

19 ‘‘(B) publish in the Federal Register the re20 sults of that review and any revisions. 

21 ‘‘(2) A revised determination published in the 

22 Federal Register under paragraph (1)(B) shall take 

23 effect for greenhouse gas emissions starting on Janu24 ary 1 of the first calendar year starting at least 9 


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1 months after the date on which the revised determina2 tion was published. 

3 ‘‘(3) The Administrator may decrease the fre4 quency of review and revision under paragraph (1) if 

5 the Administrator determines that such decrease is 

6 appropriate in order to synchronize such review and 

7 revision with any similar review process carried out 

8 pursuant to the United Nations Framework Conven9 tion on Climate Change, done at New York on May 

10 9, 1992, or to an agreement negotiated under that 

11 convention, except that in no event shall the Adminis12 trator carry out such review and revision any less fre13 quently than every 10 years. 

14 ‘‘(d) METHODOLOGY.—In setting carbon dioxide equiv15 alent values, for purposes of this section or section 711, the 

16 Administrator shall take into account publications by the 

17 Intergovernmental Panel on Climate Change or a successor 

18 organization under the auspices of the United Nations En19 vironmental Programme and the World Meteorological Or20 ganization. 

21 ‘‘SEC. 713. GREENHOUSE GAS REGISTRY. 

22 ‘‘(a) DEFINITIONS.—For purposes of this section: 

23 ‘‘(1) CLIMATE REGISTRY.—The term ‘Climate 

24 Registry’ means the greenhouse gas emissions registry 

25 jointly established and managed by more than 40 


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1 States and Indian tribes in 2007 to collect high-qual2 ity greenhouse gas emission data from facilities, cor3 porations, and other organizations to support various 

4 greenhouse gas emission reporting and reduction poli5 cies for the member States and Indian tribes. 

6 ‘‘(2) REPORTING ENTITY.—The term ‘reporting 

7 entity’ means— 

8 ‘‘(A) a covered entity; 

9 ‘‘(B) an entity that— 

10 ‘‘(i) would be a covered entity if it had 

11 emitted, produced, imported, manufactured, 

12 or delivered in 2008 or any subsequent year 

13 more than the applicable threshold level in 

14 the definition of covered entity in para15 graph (13) of section 700; and 

16 ‘‘(ii) has emitted, produced, imported, 

17 manufactured, or delivered in 2008 or any 

18 subsequent year more than the applicable 

19 threshold level in the definition of covered 

20 entity in paragraph (13) of section 700, 

21 provided that the figure of 25,000 tons of 

22 carbon dioxide equivalent is read instead as 

23 10,000 tons of carbon dioxide equivalent 

24 and the figure of 460,000,000 cubic feet is 

25 read instead as 184,000,000 cubic feet; 


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1 ‘‘(C) any other entity that emits a green2 house gas, or produces, imports, manufactures, 

3 or delivers material whose use results or may re4 sult in greenhouse gas emissions if the Adminis5 trator determines that reporting under this sec6 tion by such entity will help achieve the purposes 

7 of this title or title VIII; 

8 ‘‘(D) any vehicle fleet with emissions of 

9 more than 25,000 tons of carbon dioxide equiva10 lent on an annual basis, if the Administrator de11 termines that the inclusion of such fleet will help 

12 achieve the purposes of this title or title VIII; or 

13 ‘‘(E) any entity that delivers electricity to 

14 an energy-intensive facility in an industrial sec15 tor that meets the energy or greenhouse gas in16 tensity criteria in section 764(b)(3)(B)(i). 

17 ‘‘(b) REGULATIONS.— 

18 ‘‘(1) IN GENERAL.—Not later than 6 months 

19 after the date of enactment of this title, the Adminis20 trator shall issue regulations establishing a Federal 

21 greenhouse gas registry. Such regulations shall— 

22 ‘‘(A) require reporting entities to submit to 

23 the Administrator data on— 

24 ‘‘(i) greenhouse gas emissions in the 

25 United States; 


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1 ‘‘(ii) the production and manufacture 

2 in the United States, importation into the 

3 United States, and, at the discretion of the 

4 Administrator, exportation from the United 

5 States, of fuels and industrial gases the uses 

6 of which result or may result in greenhouse 

7 gas emissions; 

8 ‘‘(iii) deliveries in the United States of 

9 natural gas, and any other gas meeting the 

10 specifications for commingling with natural 

11 gas for purposes of delivery, the combustion 

12 of which result or may result in greenhouse 

13 gas emissions; and 

14 ‘‘(iv) the capture and sequestration of 

15 greenhouse gases; 

16 ‘‘(B) require covered entities and, where ap17 propriate, other reporting entities to submit to 

18 the Administrator data sufficient to ensure com19 pliance with or implementation of the require20 ments of this title; 

21 ‘‘(C) require reporting of electricity deliv22 ered to industrial sources in energy-intensive in23 dustries; 


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1 ‘‘(D) ensure the completeness, consistency, 

2 transparency, accuracy, precision, and reli3 ability of such data; 

4 ‘‘(E) take into account the best practices 

5 from the most recent Federal, State, tribal, and 

6 international protocols for the measurement, ac7 counting, reporting, and verification of green8 house gas emissions, including protocols from the 

9 Climate Registry and other mandatory State or 

10 multistate authorized programs; 

11 ‘‘(F) take into account the latest scientific 

12 research; 

13 ‘‘(G) require that, for covered entities with 

14 respect to greenhouse gases to which section 722 

15 applies, and, to the extent determined to be ap16 propriate by the Administrator, for covered enti17 ties with respect to other greenhouse gases and 

18 for other reporting entities, submitted data are 

19 based on— 

20 ‘‘(i) continuous monitoring systems for 

21 fuel flow or emissions, such as continuous 

22 emission monitoring systems; 

23 ‘‘(ii) alternative systems that are dem24 onstrated as providing data with the same 

25 precision, reliability, accessibility, and 


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1 timeliness, or, to the extent the Adminis2 trator determines is appropriate for report3 ing small amounts of emissions, the same 

4 precision, reliability, and accessibility and 

5 similar timeliness, as data provided by con6 tinuous monitoring systems for fuel flow or 

7 emissions; or 

8 ‘‘(iii) alternative methodologies that 

9 are demonstrated to provide data with pre10 cision, reliability, accessibility, and timeli11 ness, or, to the extent the Administrator de12 termines is appropriate for reporting small 

13 amounts of emissions, precision, reliability, 

14 and accessibility, as similar as is tech15 nically feasible to that of data generally 

16 provided by continuous monitoring systems 

17 for fuel flow or emissions, if the Adminis18 trator determines that, with respect to a re19 porting entity, there is no continuous moni20 toring system or alternative system de21 scribed in clause (i) or (ii) that is tech22 nically feasible; 

23 ‘‘(H) require that the Administrator, in de24 termining the extent to which the requirement to 

25 use systems or methodologies in accordance with 


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1 subparagraph (G) is appropriate for reporting 

2 entities other than covered entities or for green3 house gases to which section 722 does not apply, 

4 consider the cost of using such systems and meth5 odologies, and of using other systems and meth6 odologies that are available and suitable, for 

7 quantifying the emissions involved in light of the 

8 purposes of this title, including the goal of col9 lecting consistent entity-wide data; 

10 ‘‘(I) include methods for minimizing double 

11 reporting and avoiding irreconcilable double re12 porting of greenhouse gas emissions; 

13 ‘‘(J) establish measurement protocols for 

14 carbon capture and sequestration systems, taking 

15 into consideration the regulations promulgated 

16 under section 813; 

17 ‘‘(K) require that reporting entities provide 

18 the data required under this paragraph in re19 ports submitted electronically to the Adminis20 trator, in such form and containing such infor21 mation as may be required by the Adminis22 trator; 

23 ‘‘(L) include requirements for keeping 

24 records supporting or related to, and protocols 

25 for auditing, submitted data; 


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1 ‘‘(M) establish consistent policies for calcu2 lating carbon content and greenhouse gas emis3 sions for each type of fossil fuel with respect to 

4 which reporting is required; 

5 ‘‘(N) subsequent to implementation of poli6 cies developed under subparagraph (M), provide 

7 for immediate dissemination, to States, Indian 

8 tribes, and on the Internet, of all data reported 

9 under this section as soon as practicable after 

10 electronic audit by the Administrator and any 

11 resulting correction of data, except that data 

12 shall not be disseminated under this subpara13 graph if— 

14 ‘‘(i) its nondissemination is vital to 

15 the national security of the United States, 

16 as determined by the President; or 

17 ‘‘(ii) it is confidential business infor18 mation that cannot be derived from infor19 mation that is otherwise publicly available 

20 and disclosure of which would likely cause 

21 substantial harm to the competitive position 

22 of the person from which the information 

23 was obtained, except that— 

24 ‘‘(I) data relating to greenhouse 

25 gas emissions, including any upstream 


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1 or verification data from reporting en2 tities, shall not be considered to be con3 fidential business information; and 

4 ‘‘(II) data that is confidential 

5 business information shall be provided 

6 to a State or Indian tribe within 

7 whose jurisdiction the reporting entity 

8 is located, if— 

9 ‘‘(aa) the State or Indian 

10 tribe has first provided to the Ad11 ministrator a written opinion 

12 from the chief legal officer or 

13 counsel of the requesting State 

14 agency, or comparable tribal legal 

15 counsel, stating that under appli16 cable State or tribal law, the 

17 State or Indian tribe has the au18 thority to compel a business that 

19 possesses such information to dis20 close the information to the State 

21 or Indian tribe; or 

22 ‘‘(bb) each affected business is 

23 informed of disclosures under this 

24 part that pertain to the business, 

25 and the State or Indian tribe has 


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1 demonstrated to the chief legal of2 ficer of the Environmental Protec3 tion Agency that the use and dis4 closure by the State or Indian 

5 tribe, as applicable, of such infor6 mation will be governed by State 

7 or tribal law and procedures that 

8 will provide adequate protection 

9 to the interests of affected busi10 nesses; 

11 ‘‘(O) prescribe methods by which the Ad12 ministrator shall, in cases in which satisfactory 

13 data are not submitted to the Administrator for 

14 any period of time, estimate emission, produc15 tion, importation, manufacture, or delivery lev16 els— 

17 ‘‘(i) for covered entities with respect to 

18 greenhouse gas emissions, production, im19 portation, manufacture, or delivery regu20 lated under this title to ensure that emis21 sions, production, importation, manufac22 ture, or deliveries are not underreported, 

23 and to create a strong incentive for meeting 

24 data monitoring and reporting require25 ments— 


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1 ‘‘(I) with a conservative estimate 

2 of the highest emission, production, im3 portation, manufacture, or delivery 

4 levels that may have occurred during 

5 the period for which data are missing; 

6 or 

7 ‘‘(II) to the extent the Adminis8 trator considers appropriate, with an 

9 estimate of such levels assuming the 

10 unit is emitting, producing, importing, 

11 manufacturing, or delivering at a 

12 maximum potential level during the 

13 period, in order to ensure that such 

14 levels are not underreported and to cre15 ate a strong incentive for meeting data 

16 monitoring and reporting require17 ments; and 

18 ‘‘(ii) for covered entities with respect to 

19 greenhouse gas emissions to which section 

20 722 does not apply and for other reporting 

21 entities, with a reasonable estimate of the 

22 emission, production, importation, manu23 facture, or delivery levels that may have oc24 curred during the period for which data are 

25 missing; 


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1 ‘‘(P) require the designation of a designated 

2 representative for each reporting entity; 

3 ‘‘(Q) require an appropriate certification, 

4 by the designated representative for the reporting 

5 entity, of accurate and complete accounting of 

6 greenhouse gas emissions, as determined by the 

7 Administrator; and 

8 ‘‘(R) include requirements for other data 

9 necessary for accurate and complete accounting 

10 of greenhouse gas emissions, as determined by the 

11 Administrator, including data for quality assur12 ance of monitoring systems, monitors and other 

13 measurement devices, and other data needed to 

14 verify reported emissions, production, importa15 tion, manufacture, or delivery. 

16 ‘‘(2) TIMING.— 

17 ‘‘(A) CALENDAR YEARS 2007 THROUGH

18 2010.—For a base period of calendar years 2007 

19 through 2010, each reporting entity shall submit 

20 annual data required under this section to the 

21 Administrator not later than March 31, 2011. 

22 The Administrator may waive or modify report23 ing requirements for calendar years 2007 

24 through 2010 for categories of reporting entities 

25 to the extent that the Administrator determines 


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1 that the reporting entities did not keep data or 

2 records necessary to meet reporting requirements. 

3 The Administrator may, in addition to or in 

4 lieu of such requirements, collect information on 

5 energy consumption and production. 

6 ‘‘(B) SUBSEQUENT CALENDAR YEARS.—For 

7 calendar year 2011 and each subsequent cal8 endar year, each reporting entity shall submit 

9 quarterly data required under this section to the 

10 Administrator not later than 60 days after the 

11 end of the applicable quarter, except when the 

12 data is already being reported to the Adminis13 trator on an earlier timeframe for another pro14 gram. 

15 ‘‘(3) WAIVER OF REPORTING REQUIREMENTS.— 

16 The Administrator may waive reporting requirements 

17 under this section for specific entities to the extent 

18 that the Administrator determines that sufficient and 

19 equally or more reliable verified and timely data are 

20 available to the Administrator and the public on the 

21 Internet under other mandatory statutory require22 ments. 

23 ‘‘(4) ALTERNATIVE THRESHOLD.—The Adminis24 trator may, by rule, establish applicability thresholds 

25 for reporting under this section using alternative 


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1 metrics and levels, provided that such metrics and 

2 levels are easier to administer and cover the same size 

3 and type of sources as the threshold defined in this 

4 section. 

5 ‘‘(c) INTERRELATIONSHIP WITH OTHER SYSTEMS.— 

6 In developing the regulations issued under subsection (b), 

7 the Administrator shall take into account the work done by 

8 the Climate Registry and other mandatory State or 

9 multistate programs. Such regulations shall include an ex10 planation of any major differences in approach between the 

11 system established under the regulations and such registries 

12 and programs. 

13 ‘‘SEC. 714. PERFLUOROCARBON AND OTHER 

14 NONHYDROFLUOROCARBON FLUORINATED 

15 SUBSTANCE PRODUCTION REGULATION. 

16 ‘‘(a) DEFINITIONS.—In this section: 

17 ‘‘(1) BEST ACHIEVABLE PERFORMANCE STAND18 ARD.—The term ‘best achievable performance stand19 ard’ means a limitation on total emissions based on 

20 the maximum degree of reduction of fluorinated gases 

21 that are greenhouse gases subject to regulation under 

22 this Act emitted during the production of 

23 nonhydrofluorocarbon fluorinated substances at cov24 ered entities that the Administrator, taking into con25 sideration energy, environmental, economic impacts, 


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1 and other costs, determines to be achievable for cov2 ered entities through application of production proc3 ess optimization and available methods, control tech4 nologies or systems, and management techniques or 

5 practices. 

6 ‘‘(2) NONHYDROFLUOROCARBON FLUORINATED

7 SUBSTANCE.—The term ‘nonhydrofluorocarbon 

8 fluorinated substance’ means a substance included on 

9 the list under subsection (d) that— 

10 ‘‘(A) is not listed as a class I or class II 

11 substance under title VI; and 

12 ‘‘(B) is not— 

13 ‘‘(i) sulfur hexafluoride; or 

14 ‘‘(ii) nitrogen trifluoride. 

15 ‘‘(b) DETERMINATION BY ADMINISTRATOR.— 

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

17 the date of enactment of this section, the Adminis18 trator shall determine, based on the criteria described 

19 in paragraph (2), whether fluorinated gases that are 

20 greenhouse gases emitted during the production of 

21 nonhydrofluorocarbon fluorinated substances should be 

22 regulated in accordance with— 

23 ‘‘(A) subsection (c); or 

24 ‘‘(B) the applicable requirements of section 

25 722 relating to emissions of greenhouse gases 


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1 during fluorinated substance production at cov2 ered entities. 

3 ‘‘(2) CRITERIA FOR DETERMINATION.—In mak4 ing the determination under paragraph (1), the Ad5 ministrator shall take into consideration— 

6 ‘‘(A) whether an equivalent or greater level 

7 of total emissions reductions could be achieved 

8 under subsection (c), as compared to the emis9 sions reductions that would be achieved under 

10 the applicable requirements of section 722 relat11 ing to emissions of greenhouse gases during 

12 fluorinated substance production at covered enti13 ties; and 

14 ‘‘(B) such other criteria as the Adminis15 trator determines to be appropriate. 

16 ‘‘(c) GREENHOUSE GAS EMISSIONS FROM

17 NONHYDROFLUOROCARBON FLUORINATED SUBSTANCE

18 PRODUCTION.— 

19 ‘‘(1) IN GENERAL.—If the Administrator makes 

20 the determination described in subsection (b)(1)(A), 

21 not later than 18 months after the date of enactment 

22 of this section, the Administrator shall promulgate 

23 regulations applicable to covered entities that require 

24 fluorinated gases that are greenhouse gases emitted 

25 during the production of nonhydrofluorocarbon 


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1 fluorinated substances at those covered entities to meet 

2 the best achievable performance standard. 

3 ‘‘(2) BEST ACHIEVABLE PERFORMANCE STAND4 ARD REVIEW.—The Administrator shall, at the discre5 tion of the Administrator— 

6 ‘‘(A) not later than 2 years after the date 

7 of establishment of a best achievable performance 

8 standard, and every 2 years thereafter— 

9 ‘‘(i) review the best achievable perform10 ance standard; and 

11 ‘‘(ii) as necessary, establish a more 

12 stringent best available performance stand13 ard that reduces emissions, to the maximum 

14 extent practicable, in accordance with the 

15 economy-wide reduction goals referred to in 

16 section 702; or 

17 ‘‘(B) not later than 2 years after the date 

18 of establishment of a best achievable performance 

19 standard, and every 10 years thereafter, establish 

20 a 10-year schedule under which each applicable 

21 covered entity shall incrementally implement a 

22 more stringent best achievable performance 

23 standard that reduces, to the maximum extent 

24 practicable, emissions in accordance with the 


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1 economy-wide reduction goals referred to in sec2 tion 702. 

3 ‘‘(3) EXCLUSIVITY.—If the Administrator makes 

4 the determination described in subsection (b)(1)(A), 

5 the requirements of this subsection relating to control 

6 of emissions of fluorinated gases that are greenhouse 

7 gases during the production of nonhydrofluorocarbon 

8 fluorinated substances shall apply in lieu of the re9 quirements of section 722 relating to emissions of 

10 fluorinated gases that are greenhouse gases during 

11 fluorinated substance production at covered entities. 

12 ‘‘(d) LIST OF NONHYDROFLUOROCARBON

13 FLUORINATED SUBSTANCES.— 

14 ‘‘(1) INITIAL LIST.—If the Administrator makes 

15 the determination described in subsection (b)(1)(A), 

16 not later than 2 years after the date of enactment of 

17 this section, the Administrator shall publish a list of 

18 nonhydrofluorocarbon fluorinated substances subject 

19 to regulation under this section. 

20 ‘‘(2) ADDITIONS TO LIST.—The Administrator 

21 may include on the list published under paragraph 

22 (1) any substance that meets the requirements de23 scribed in subsection (a)(2). 


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1 ‘‘PART C—PROGRAM RULES 

2 ‘‘SEC. 721. EMISSION ALLOWANCES. 

3 ‘‘(a) IN GENERAL.—The Administrator shall establish 

4 a separate quantity of emission allowances for each cal5 endar year starting in 2012, in the quantities prescribed 

6 under subsection (e). 

7 ‘‘(b) IDENTIFICATION NUMBERS.—The Administrator 

8 shall assign to each emission allowance established under 

9 subsection (a) a unique identification number that includes 

10 the vintage year for that emission allowance. 

11 ‘‘(c) LEGAL STATUS OF EMISSION ALLOWANCES.— 

12 ‘‘(1) IN GENERAL.—An allowance established by 

13 the Administrator under this title does not constitute 

14 a property right. 

15 ‘‘(2) TERMINATION OR LIMITATION.—Nothing in 

16 this Act or any other provision of law shall be con17 strued to limit or alter the authority of the United 

18 States, including the Administrator acting pursuant 

19 to statutory authority, to terminate or limit allow20 ances, offset credits, or term offset credits. 

21 ‘‘(3) OTHER PROVISIONS UNAFFECTED.—Except 

22 as otherwise specified in this Act, nothing in this Act 

23 relating to allowances, offset credits, or term offset 

24 credits established or issued under this title shall af25 fect the application of any other provision of law to 


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1 a covered entity, or the responsibility for a covered 

2 entity to comply with any such provision of law. 

3 ‘‘(d) SAVINGS PROVISION.—Nothing in this part shall 

4 be construed as requiring a change of any kind in any State 

5 or tribal law regulating electric utility rates and charges, 

6 or as affecting any State or tribal law regarding such State 

7 regulation, or as limiting State or tribal regulation (includ8 ing any prudency review) under such a State or tribal law. 

9 Nothing in this part shall be construed as modifying the 

10 Federal Power Act (16 U.S.C. 791a et seq.) or as affecting 

11 the authority of the Federal Energy Regulatory Commission 

12 under that Act. Nothing in this part shall be construed to 

13 interfere with or impair any program for competitive bid14 ding for power supply in a State in which such program 

15 is established. 

16 ‘‘(e) ALLOWANCES FOR EACH CALENDAR YEAR.— 

17 ‘‘(1) IN GENERAL.—Except as provided in para18 graph (2), the number of emission allowances estab19 lished by the Administrator under subsection (a) for 

20 each calendar year shall be as provided in the fol21 lowing table: 

‘‘Calendar Year Emission Allowances (MtCO2e) 

2012 ............................................................................. 4,627 

2013 ............................................................................. 4,544 

2014 ............................................................................. 5,053 

2015 ............................................................................. 5,003 

2016 ............................................................................. 5,482 

2017 ............................................................................. 5,261 

2018 ............................................................................. 5,132 


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2019 ............................................................................. 5,002 

2020 ............................................................................. 4,873 

2021 ............................................................................. 4,739 

2022 ............................................................................. 4,605 

2023 ............................................................................. 4,471 

2024 ............................................................................. 4,337 

2025 ............................................................................. 4,203 

2026 ............................................................................. 4,069 

2027 ............................................................................. 3,935 

2028 ............................................................................. 3,801 

2029 ............................................................................. 3,667 

2030 ............................................................................. 3,533 

2031 ............................................................................. 3,408 

2032 ............................................................................. 3,283 

2033 ............................................................................. 3,158 

2034 ............................................................................. 3,033 

2035 ............................................................................. 2,908 

2036 ............................................................................. 2,784 

2037 ............................................................................. 2,659 

2038 ............................................................................. 2,534 

2039 ............................................................................. 2,409 

2040 ............................................................................. 2,284 

2041 ............................................................................. 2,159 

2042 ............................................................................. 2,034 

2043 ............................................................................. 1,910 

2044 ............................................................................. 1,785 

2045 ............................................................................. 1,660 

2046 ............................................................................. 1,535 

2047 ............................................................................. 1,410 

2048 ............................................................................. 1,285 

2049 ............................................................................. 1,160 

2050 and each calendar year thereafter .................... 1,035 

1 ‘‘(2) REVISION.— 

2 ‘‘(A) IN GENERAL.—The Administrator 

3 may adjust, in accordance with subparagraph 

4 (B), the number of emission allowances estab5 lished pursuant to paragraph (1) if, after notice 

6 and an opportunity for public comment, the Ad7 ministrator determines that— 

8 ‘‘(i) United States greenhouse gas 

9 emissions in 2005 were other than 7,206 


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1 million metric tons carbon dioxide equiva2 lent; 

3 ‘‘(ii) if the requirements of this title for 

4 2012 had been in effect in 2005, section 722 

5 would have required emission allowances to 

6 be held for other than 66.2 percent of 

7 United States greenhouse gas emissions in 

8 2005; 

9 ‘‘(iii) if the requirements of this title 

10 for 2014 had been in effect in 2005, section 

11 722 would have required emission allow12 ances to be held for other than 75.6 percent 

13 of United States greenhouse gas emissions 

14 in 2005; or 

15 ‘‘(iv) if the requirements of this title 

16 for 2016 had been in effect in 2005, section 

17 722 would have required emission allow18 ances to be held for other than 84.5 percent 

19 United States greenhouse gas emissions in 

20 2005. 

21 ‘‘(B) ADJUSTMENT FORMULA.— 

22 ‘‘(i) IN GENERAL.—If the Adminis23 trator adjusts under this paragraph the 

24 number of emission allowances established 

25 pursuant to paragraph (1), the number of 


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1 emission allowances the Administrator es2 tablishes for any given calendar year shall 

3 equal the product of— 

4 ‘‘(I) United States greenhouse gas 

5 emissions in 2005, expressed in tons of 

6 carbon dioxide equivalent; 

7 ‘‘(II) the percent of United States 

8 greenhouse gas emissions in 2005, ex9 pressed in tons of carbon dioxide equiv10 alent, that would have been subject to 

11 section 722 if the requirements of this 

12 title for the given calendar year had 

13 been in effect in 2005; and 

14 ‘‘(III) the percentage set forth for 

15 that calendar year in section 703(a), 

16 or determined under clause (ii) of this 

17 subparagraph. 

18 ‘‘(ii) TARGETS.—In applying the por19 tion of the formula in clause (i)(III) of this 

20 subparagraph, for calendar years for which 

21 a percentage is not listed in section 703(a), 

22 the Administrator shall use a uniform an23 nual decline in the amount of emissions be24 tween the years that are specified. 


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1 ‘‘(iii) CARBON DIOXIDE EQUIVALENT

2 VALUE.—If the Administrator adjusts under 

3 this paragraph the number of emission al4 lowances established pursuant to paragraph 

5 (1), the Administrator shall use the carbon 

6 dioxide equivalent values established pursu7 ant to section 712. 

8 ‘‘(iv) LIMITATION ON ADJUSTMENT

9 TIMING.—Once a calendar year has started, 

10 the Administrator may not adjust the num11 ber of emission allowances to be established 

12 for that calendar year. 

13 ‘‘(C) LIMITATION ON ADJUSTMENT AUTHOR14 ITY.—The Administrator may adjust under this 

15 paragraph the number of emission allowances to 

16 be established pursuant to paragraph (1) only 

17 once. 

18 ‘‘(f) COMPENSATORY ALLOWANCE.— 

19 ‘‘(1) IN GENERAL.—The regulations promulgated 

20 under subsection (h) shall provide for the establish21 ment and distribution of compensatory allowances 

22 for— 

23 ‘‘(A) the destruction, in 2012 or later, of 

24 fluorinated gases that are greenhouse gases if— 


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1 ‘‘(i) allowances or offset credits were 

2 retired for their production or importation; 

3 and 

4 ‘‘(ii) such gases are not required to be 

5 destroyed under any other provision of law; 

6 ‘‘(B) the nonemissive use, in 2012 or later, 

7 of petroleum-based or coal-based liquid or gas8 eous fuel, petroleum coke, natural gas liquid, or 

9 natural gas as a feedstock, if allowances or offset 

10 credits were retired for the greenhouse gases that 

11 would have been emitted from their combustion; 

12 and 

13 ‘‘(C) the conversionary use, in 2012 or 

14 later, of fluorinated gases in a manufacturing 

15 process, including semiconductor research or 

16 manufacturing, if allowances or offset credits 

17 were retired for the production or importation of 

18 such gas. 

19 ‘‘(2) ESTABLISHMENT AND DISTRIBUTION.— 

20 ‘‘(A) IN GENERAL.—Not later than 90 days 

21 after the end of each calendar year, the Adminis22 trator shall establish and distribute to the entity 

23 taking the actions described in subparagraph 

24 (A), (B), or (C) of paragraph (1) a quantity of 

25 compensatory allowances equivalent to the numVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01311 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ber of tons of carbon dioxide equivalent of avoid2 ed emissions achieved through such actions. In 

3 establishing the quantity of compensatory allow4 ances, the Administrator shall take into account 

5 the carbon dioxide equivalent value of any green6 house gas resulting from such action. 

7 ‘‘(B) SOURCE OF ALLOWANCES.—Compen8 satory allowances established under this sub9 section shall not be emission allowances estab10 lished under subsection (a). 

11 ‘‘(C) IDENTIFICATION NUMBERS.—The Ad12 ministrator shall assign to each compensatory 

13 allowance established under subparagraph (A) a 

14 unique identification number. 

15 ‘‘(3) DEFINITIONS.—For purposes of this sub16 section— 

17 ‘‘(A) the term ‘destruction’ means the con18 version of a greenhouse gas by thermal, chemical, 

19 or other means to another gas or set of gases 

20 with little or no carbon dioxide equivalent value; 

21 ‘‘(B) the term ‘nonemissive use’ means the 

22 use of fossil fuel as a feedstock in an industrial 

23 or manufacturing process to the extent that 

24 greenhouse gases are not emitted from such proc25 ess, and to the extent that the products of such 


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1 process are not intended for use as, or to be con2 tained in, a fuel; and 

3 ‘‘(C) the term ‘conversionary use’ means the 

4 conversion during research or manufacturing of 

5 a fluorinated gas into another greenhouse gas or 

6 set of gases with a lower carbon dioxide equiva7 lent value. 

8 ‘‘(4) FEEDSTOCK EMISSIONS STUDY.— 

9 ‘‘(A) The Administrator may conduct a 

10 study to determine the extent to which petro11 leum-based or coal-based liquid or gaseous fuel, 

12 petroleum coke, natural gas liquid, or natural 

13 gas are used as feedstocks in manufacturing 

14 processes to produce products and the greenhouse 

15 gas emissions resulting from such uses. 

16 ‘‘(B) If as a result of such a study, the Ad17 ministrator determines that the use of such prod18 ucts by noncovered sources results in substantial 

19 emissions of greenhouse gases or their precursors 

20 and that such emissions have not been ade21 quately addressed under other requirements of 

22 this Act, the Administrator may, after notice 

23 and comment rulemaking, promulgate a regula24 tion reducing compensatory allowances commen25 surately if doing so will not result in leakage. 


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1 ‘‘(g) FLUORINATED GASES ASSESSMENT.— 

2 ‘‘(1) IN GENERAL.—Not later than March 31, 

3 2014, the Administrator shall conduct an assessment 

4 of the regulation of non-hydrofluorocarbon fluorinated 

5 gases under this title to determine whether the most 

6 appropriate point of regulation of those gases is at— 

7 ‘‘(A) the gas manufacturer or importer 

8 level; or 

9 ‘‘(B) the downstream source of the emis10 sions. 

11 ‘‘(2) MODIFICATION OF DEFINITION.—If the Ad12 ministrator determines, based on consideration of en13 vironmental effectiveness, cost-effectiveness, adminis14 trative feasibility, extent of coverage of emissions, and 

15 competitiveness considerations, that emissions of non16 hydrofluorocarbon fluorinated gases can best be regu17 lated by designating downstream emission sources as 

18 covered entities with compliance obligations under 

19 section 722, the Administrator shall— 

20 ‘‘(A) after providing notice and an oppor21 tunity for comment, modify the definition of the 

22 term ‘covered entity’ with respect to fluorinated 

23 gases (other than hydrofluorocarbons) accord24 ingly; and 


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1 ‘‘(B) establish such requirements as are nec2 essary to ensure compliance by the covered enti3 ties with the requirements of this title. 

4 ‘‘(h) REGULATIONS.—Not later than 24 months after 

5 the date of enactment of this title, the Administrator shall 

6 promulgate regulations to carry out the provisions of this 

7 title. 

8 ‘‘SEC. 722. PROHIBITION OF EXCESS EMISSIONS. 

9 ‘‘(a) PROHIBITION.—Except as provided in subsection 

10 (c), effective January 1, 2012, each covered entity is prohib11 ited from emitting greenhouse gases, and having attrib12 utable greenhouse gas emissions, in combination, in excess 

13 of its allowable emissions level. A covered entity’s allowable 

14 emissions level for each calendar year is the number of emis15 sion allowances (or credits or other allowances as provided 

16 in subsection (d)) it holds as of 12:01 a.m. on April 1 (or 

17 a later date established by the Administrator under sub18 section (j)) of the following calendar year. 

19 ‘‘(b) METHODS OF DEMONSTRATING COMPLIANCE.— 

20 Except as otherwise provided in this section, the owner or 

21 operator of a covered entity shall not be considered to be 

22 in compliance with the prohibition in subsection (a) unless, 

23 as of 12:01 a.m. on April 1 (or a later date established by 

24 the Administrator under subsection (j)) of each calendar 

25 year starting in 2013, the owner or operator holds a quanVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01315 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 tity of emission allowances (or credits or other allowances 

2 as provided in subsection (d)) at least as great as the quan3 tity calculated as follows: 

4 ‘‘(1) ELECTRICITY SOURCES.—For a covered en5 tity described in section 700(13)(A), 1 emission allow6 ance for each ton of carbon dioxide equivalent of 

7 greenhouse gas that such covered entity emitted in the 

8 previous calendar year, excluding emissions resulting 

9 from the combustion of— 

10 ‘‘(A) petroleum-based or coal-based liquid 

11 fuel; 

12 ‘‘(B) natural gas liquid; 

13 ‘‘(C) renewable biomass or gas derived from 

14 renewable biomass; or 

15 ‘‘(D) petroleum coke. 

16 ‘‘(2) FUEL PRODUCERS AND IMPORTERS.—For a 

17 covered entity described in section 700(13)(B), 1 

18 emission allowance for each ton of carbon dioxide 

19 equivalent of greenhouse gas that would be emitted 

20 from the combustion of any petroleum-based or coal21 based liquid fuel, petroleum coke, or natural gas liq22 uid, produced or imported by such covered entity dur23 ing the previous calendar year for sale or distribution 

24 in interstate commerce, assuming no capture and se25 questration of any greenhouse gas emissions. 


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1 ‘‘(3) INDUSTRIAL GAS PRODUCERS AND IMPORT2 ERS.—For a covered entity described in section 

3 700(13)(C), 1 emission allowance for each ton of car4 bon dioxide equivalent of fossil fuel-based carbon diox5 ide, nitrous oxide, or any other fluorinated gas that 

6 is a greenhouse gas (except for nitrogen trifluoride), 

7 or any combination thereof, produced or imported by 

8 such covered entity during the previous calendar year 

9 for sale or distribution in interstate commerce. 

10 ‘‘(4) NITROGEN TRIFLUORIDE SOURCES.—For a 

11 covered entity described in section 700(13)(D), 1 

12 emission allowance for each ton of carbon dioxide 

13 equivalent of nitrogen trifluoride that such covered 

14 entity emitted in the previous calendar year. 

15 ‘‘(5) GEOLOGICAL SEQUESTRATION SITES.—For 

16 a covered entity described in section 700(13)(E), 1 

17 emission allowance for each ton of carbon dioxide 

18 equivalent of greenhouse gas that such covered entity 

19 emitted in the previous calendar year. 

20 ‘‘(6) INDUSTRIAL STATIONARY SOURCES.—For a 

21 covered entity described in section 700(13)(F), (G), or 

22 (H), 1 emission allowance for each ton of carbon di23 oxide equivalent of greenhouse gas that such covered 

24 entity emitted in the previous calendar year, exclud25 ing emissions resulting from— 


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1 ‘‘(A) the combustion of petroleum-based or 

2 coal-based liquid fuel; 

3 ‘‘(B) the combustion of natural gas liquid; 

4 ‘‘(C) the combustion of renewable biomass 

5 or gas derived from renewable biomass; 

6 ‘‘(D) the combustion of petroleum coke; or 

7 ‘‘(E) the use of any fluorinated gas that is 

8 a greenhouse gas purchased for use at that cov9 ered entity, except for nitrogen trifluoride. 

10 ‘‘(7) INDUSTRIAL FOSSIL FUEL-FIRED COMBUS11 TION DEVICES.—For a covered entity described in sec12 tion 700(13)(I), 1 emission allowance for each ton of 

13 carbon dioxide equivalent of greenhouse gas that the 

14 devices emitted in the previous calendar year, exclud15 ing emissions resulting from the combustion of— 

16 ‘‘(A) petroleum-based or coal-based liquid 

17 fuel; 

18 ‘‘(B) natural gas liquid; 

19 ‘‘(C) renewable biomass or gas derived from 

20 renewable biomass; or 

21 ‘‘(D) petroleum coke. 

22 ‘‘(8) NATURAL GAS LOCAL DISTRIBUTION COMPA23 NIES.—For a covered entity described in section 

24 700(13)(J), 1 emission allowance for each ton of car25 bon dioxide equivalent of greenhouse gas that would 


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1 be emitted from the combustion of the natural gas, 

2 and any other gas meeting the specifications for com3 mingling with natural gas for purposes of delivery, 

4 that such entity delivered during the previous cal5 endar year to customers that are not covered entities, 

6 assuming no capture and sequestration of that green7 house gas. 

8 ‘‘(9) R&D FACILITIES.— 

9 ‘‘(A) IN GENERAL.—For a qualified R&D 

10 facility that emitted 25,000 tons per year or 

11 more carbon dioxide equivalent in the previous 

12 calendar year, 1 emission allowance for each ton 

13 of carbon dioxide equivalent of greenhouse gas 

14 that such facility emitted in the previous cal15 endar year. 

16 ‘‘(B) TREATMENT.—A qualified R&D facil17 ity shall be treated as a separate covered entity 

18 solely for purposes of applying the requirements 

19 of this subsection. 

20 ‘‘(10) ALGAE-BASED FUELS.—Where carbon di21 oxide (or another greenhouse gas) generated by a cov22 ered entity is used as an input in the production of 

23 algae-based fuels, the Administrator shall ensure that 

24 emission allowances are required to be held either for 

25 the carbon dioxide generated by a covered entity used 


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1 to grow the algae or for the portion of the carbon di2 oxide emitted from combustion of the fuel produced 

3 from such algae that is attributable to carbon dioxide 

4 generated by a covered entity, but not for both. 

5 ‘‘(11) FUGITIVE EMISSIONS.—The greenhouse gas 

6 emissions to which paragraphs (1), (4), (6), and (7) 

7 apply shall not include fugitive emissions of green8 house gas, except to the extent the Administrator de9 termines that data on the carbon dioxide equivalent 

10 value of greenhouse gas in the fugitive emissions can 

11 be provided with sufficient precision, reliability, ac12 cessibility, and timeliness to ensure the integrity of 

13 emission allowances, the allowance tracking system, 

14 and the limits on emissions. 

15 ‘‘(12) EXPORT EXEMPTION.—This section shall 

16 not apply to any petroleum-based or coal-based liquid 

17 fuel, petroleum coke, natural gas liquid, fossil fuel18 based carbon dioxide, nitrous oxide, or fluorinated gas 

19 that is exported for sale or use. 

20 ‘‘(13) NATURAL GAS LIQUIDS.—Notwithstanding 

21 subsection (a), if the owner or operator of a covered 

22 entity described in section 700(13)(B) that produces 

23 natural gas liquids does not take ownership of the liq24 uids, and is not responsible for the distribution or use 

25 of the liquids in commerce, the owner of the liquids 


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1 shall be responsible for compliance with this section, 

2 section 723, and other relevant sections of this title 

3 with respect to such liquids. In the regulations pro4 mulgated under section 721, the Administrator shall 

5 include such provisions with respect to such liquids as 

6 the Administrator determines are appropriate to de7 termine and ensure compliance, and to penalize non8 compliance. In such a case, the owner of the covered 

9 entity shall provide to the Administrator, in a man10 ner to be determined by the Administrator, informa11 tion regarding the quantity and ownership of liquids 

12 produced at the covered entity. 

13 ‘‘(14) APPLICATION OF MULTIPLE PARA14 GRAPHS.—For a covered entity to which more than 1 

15 of paragraphs (1) through (8) apply, all applicable 

16 paragraphs shall apply, except that not more than 1 

17 emission allowance shall be required for the same 

18 emission. 

19 ‘‘(c) PHASE-IN OF PROHIBITION.— 

20 ‘‘(1) INDUSTRIAL STATIONARY SOURCES.—The 

21 prohibition under subsection (a) shall first apply to 

22 a covered entity described in section 700(13)(D), (F), 

23 (G), (H), or (I), with respect to emissions occurring 

24 during calendar year 2014. 


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1 ‘‘(2) SMALL BUSINESS REFINERS.—The prohibi2 tion under subsection (a) shall first apply to a cov3 ered entity described in section 700(13)(F)(viii) that 

4 is a small business refiner with respect to emissions 

5 during calendar year 2015. 

6 ‘‘(3) NATURAL GAS LOCAL DISTRIBUTION COMPA7 NIES.—The prohibition under subsection (a) shall 

8 first apply to a covered entity described in section 

9 700(13)(J) with respect to deliveries occurring during 

10 calendar year 2016. 

11 ‘‘(d) ADDITIONAL METHODS.—In addition to using the 

12 method of compliance described in subsection (b), a covered 

13 entity may do the following: 

14 ‘‘(1) OFFSET CREDITS.— 

15 ‘‘(A) CREDITS.— 

16 ‘‘(i) IN GENERAL.—Covered entities 

17 collectively may, in accordance with this 

18 paragraph, use offset credits to demonstrate 

19 compliance for up to a maximum of 

20 2,000,000,000 tons of greenhouse gas emis21 sions annually. 

22 ‘‘(ii) DEMONSTRATION OF COMPLI23 ANCE.—In any calendar year, a covered en24 tity may demonstrate compliance by hold25 ing 1 domestic offset credit or 1.25 interVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01322 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 national offset credits in lieu of an emission 

2 allowance, except as provided in subpara3 graph (D), up to a total number of offset 

4 credits described in subparagraph (B). 

5 ‘‘(B) APPLICABLE PERCENTAGE.— 

6 ‘‘(i) IN GENERAL.—The total number 

7 of offset credits referred to in subparagraph 

8 (A)(ii) for a covered entity for a given cal9 endar year shall be determined by— 

10 ‘‘(I) dividing— 

11 ‘‘(aa) the tons of carbon diox12 ide equivalent of greenhouse gas 

13 emissions of the covered entity 

14 (except for the types of emissions 

15 excluded under subparagraphs (A) 

16 through (D) of subsection (b)(1), 

17 subparagraphs (A) through (E) of 

18 subsection (b)(6), and subpara19 graphs (A) through (D) of sub20 section (b)(7)) and attributable 

21 greenhouse gas emissions for the 

22 year before the preceding calendar 

23 year; by 

24 ‘‘(bb) the sum of the tons of 

25 carbon dioxide equivalent of 


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1 greenhouse gas emissions of all 

2 covered entities (except for the 

3 types of emissions excluded under 

4 subparagraphs (A) through (D) of 

5 subsection (b)(1), subparagraphs 

6 (A) through (E) of subsection 

7 (b)(6), and subparagraphs (A) 

8 through (D) of subsection (b)(7)) 

9 and attributable greenhouse gas 

10 emissions for the year before the 

11 preceding calendar year; and 

12 ‘‘(II) multiplying the quotient ob13 tained under subclause (I) by 

14 2,000,000,000. 

15 ‘‘(ii) APPLICABILITY.—Clause (i) shall 

16 apply to a covered entity (including a cov17 ered entity that commenced operation dur18 ing the preceding calendar year) even if the 

19 covered entity had no greenhouse gas emis20 sions or attributable greenhouse gas emis21 sions described in that clause. 

22 ‘‘(iii) OFFSET CREDITS.—Not more 

than 3 23 ⁄4 of the applicable percentage under 

24 this paragraph may be used by holding domestic offset credits, and not more than 1 25 ⁄4


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1 of the applicable percentage under this 

2 paragraph may be used by holding inter3 national offset credits, except as provided in 

4 subparagraph (C). 

5 ‘‘(C) MODIFIED PERCENTAGES.—If the Ad6 ministrator determines that domestic offset cred7 its available for use in demonstrating compli8 ance in any calendar year at domestic offset 

9 prices generally equal to or less than allowance 

10 prices, are likely to offset less than 900,000,000 

11 tons of greenhouse gas emissions (measured in 

12 tons of carbon dioxide equivalents), the Adminis13 trator shall increase the percent of emissions that 

14 can be offset through the use of international off15 set credits (and decrease the percent of emissions 

16 that can be allowed through the use of domestic 

17 offset credits by the same amount) to reflect the 

18 amount that 1,500,000,000 exceeds the number of 

19 domestic offset credits the Administrator deter20 mines is available for that year, up to a max21 imum of 750,000,000 tons of greenhouse gas 

22 emissions. 

23 ‘‘(D) INTERNATIONAL OFFSET CREDITS.— 

24 Notwithstanding subparagraph (A), to dem25 onstrate compliance prior to calendar year 2018, 


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1 a covered entity may use 1 international offset 

2 credit in lieu of an emission allowance up to the 

3 amount permitted under this paragraph. 

4 ‘‘(E) PRESIDENT’S RECOMMENDATION.—The 

5 President may make a recommendation to Con6 gress as to whether the number 2,000,000,000 

7 specified in subparagraphs (A) and (B) should 

8 be increased or decreased. 

9 ‘‘(2) TERM OFFSET CREDITS.— 

10 ‘‘(A) IN GENERAL.—Covered entities may, 

11 in accordance with this paragraph, use non-ex12 pired term offset credits instead of domestic offset 

13 credits for purposes of temporarily dem14 onstrating compliance with this section. 

15 ‘‘(B) AMOUNT.—The combined quantity of 

16 term offset credits and domestic offset credits 

17 used by a covered entity to demonstrate compli18 ance for its emissions or attributable greenhouse 

19 gas emissions in any given year shall not exceed 

20 the quantity of domestic offset credits that a cov21 ered entity is entitled to use for that year to 

22 demonstrate compliance in accordance with 

23 paragraph (1). 

24 ‘‘(C) EXPIRATION.—A term offset credit 

25 shall expire in the year after its term ends. The 


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1 term of a term offset credit shall be calculated by 

2 adding to the year of issuance the number of 

3 years equal to the length of the crediting period 

4 for the practice or project for which the term off5 set credit was issued, but in no case shall be 

6 later than the date 5 years from the date of 

7 issuance. 

8 ‘‘(D) DEMONSTRATING COMPLIANCE UPON

9 EXPIRATION OF TERM OFFSET CREDIT.—With re10 spect to the emissions for which a covered entity 

11 is using term offset credits to demonstrate com12 pliance temporarily with this section, the owner 

13 or operator of a covered entity shall not be con14 sidered to be in compliance with the prohibition 

15 in subsection (a) unless, as of 12:01 a.m. on 

16 April 1 (or a later date established by the Ad17 ministrator under subsection (j)) of the calendar 

18 year in which a term offset credit expires, the 

19 owner or operator holds— 

20 ‘‘(i) for purposes of finally dem21 onstrating compliance, an allowance or a 

22 domestic offset credit; or 

23 ‘‘(ii) for purposes of temporarily dem24 onstrating compliance, a non-expired term 

25 offset credit. 


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1 ‘‘(E) INAPPLICABILITY OF PERCENTAGE

2 LIMITATIONS.—Domestic offset credits used for 

3 purposes of finally demonstrating compliance 

4 under this subparagraph shall not be subject to 

5 the percentage limitations in subparagraph (B). 

6 ‘‘(F) FINANCIAL ASSURANCE.—A covered 

7 entity may not use a term offset credit to dem8 onstrate compliance temporarily unless it simul9 taneously provides to the Administrator finan10 cial assurance that, at the end of the term offset 

11 credit‘s crediting term, the covered entity will 

12 have sufficient resources to obtain the quantity of 

13 allowances or credits necessary to demonstrate 

14 final compliance. The Administrator shall issue 

15 regulations establishing requirements for such fi16 nancial assurance, which shall take into account 

17 the increased risk associated with longer cred18 iting terms. These regulations shall take into ac19 count the total number of tons of carbon dioxide 

20 equivalent of greenhouse gas emissions for which 

21 a covered entity is demonstrating compliance 

22 temporarily, and may set a limit on this 

23 amount. In the event that a covered entity that 

24 used term offset credits to demonstrate compli25 ance temporarily fails to meet the requirements 


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1 of subparagraph (D) at the end of the term offset 

2 credits’ crediting term, if the financial assurance 

3 mechanism fails to provide to the Administrator 

4 the number of allowances or offset credits for 

5 which the crediting term has expired, then the 

6 Administrator shall retire that number of allow7 ances with the vintage year 2 years after the 

8 year in which the term offset credit expires in 

9 the same amount. Allowances so retired shall not 

10 be counted as emission allowances established for 

11 that calendar year under section 721(a). 

12 ‘‘(3) INTERNATIONAL EMISSION ALLOWANCES.— 

13 To demonstrate compliance, a covered entity may 

14 hold an international emission allowance in lieu of 

15 an emission allowance, except as modified under sec16 tion 728(d). 

17 ‘‘(4) COMPENSATORY ALLOWANCES.—To dem18 onstrate compliance, a covered entity may hold a 

19 compensatory allowance obtained under section 721(f) 

20 in lieu of an emission allowance. 

21 ‘‘(e) RETIREMENT OF ALLOWANCES AND CREDITS.— 

22 As soon as practicable after a deadline established for cov23 ered entities to demonstrate compliance with this title, the 

24 Administrator shall retire the quantity of allowances or 

25 credits required to be held under this title. 


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1 ‘‘(f) ALTERNATIVE METRICS.—For categories of cov2 ered entities described in subparagraph (B), (C), (D), (G), 

3 (H), or (I) of section 700(13), the Administrator may, by 

4 rule, establish an applicability threshold for inclusion 

5 under those subparagraphs using an alternative metric and 

6 level, provided that such metric and level are easier to ad7 minister and cover the same size and type of sources as 

8 the threshold defined in such subparagraphs. 

9 ‘‘(g) THRESHOLD REVIEW.—For each category of cov10 ered entities described in subparagraph (B), (C), (D), (G), 

11 (H), or (I) of section 700(13), the Administrator shall, in 

12 2020 and once every 8 years thereafter, review the carbon 

13 dioxide equivalent emission thresholds that are used to de14 fine covered entities. After consideration of— 

15 ‘‘(1) emissions from covered entities in each such 

16 category, and from other entities of the same type that 

17 emit less than the threshold amount for the category 

18 (including emission sources that commence operation 

19 after the date of enactment of this title that are not 

20 covered entities); and 

21 ‘‘(2) whether greater greenhouse gas emission re22 ductions can be cost-effectively achieved by lowering 

23 the applicable threshold, 

24 the Administrator may by rule lower such threshold to not 

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1 sions. In determining the cost effectiveness of potential re2 ductions from lowering the threshold for covered entities, the 

3 Administrator shall consider alternative regulatory green4 house gas programs, including setting standards under 

5 other titles of this Act. 

6 ‘‘(h) DESIGNATED REPRESENTATIVES.—The regula7 tions promulgated under section 721(h) shall require that 

8 each covered entity, and each entity holding allowances or 

9 credits or receiving allowances or credits from the Adminis10 trator under this title, select a designated representative. 

11 ‘‘(i) EDUCATION AND OUTREACH.— 

12 ‘‘(1) IN GENERAL.—The Administrator shall es13 tablish and carry out a program of education and 

14 outreach to assist covered entities, especially entities 

15 having little experience with environmental regu16 latory requirements similar or comparable to those 

17 under this title, in preparing to meet the compliance 

18 obligations of this title. Such program shall include 

19 education with respect to using markets to effectively 

20 achieve such compliance. 

21 ‘‘(2) FAILURE TO RECEIVE INFORMATION.—A 

22 failure to receive information or assistance under this 

23 subsection may not be used as a defense against an 

24 allegation of any violation of this title. 


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1 ‘‘(j) ADJUSTMENT OF DEADLINE.—The Administrator 

2 may, by rule, establish a deadline for demonstrating com3 pliance, for a calendar year, later than the date provided 

4 in subsection (a), as necessary to ensure the availability 

5 of emissions data, but in no event shall the deadline be later 

6 than June 1. 

7 ‘‘(k) NOTICE REQUIREMENT FOR COVERED ENTITIES

8 RECEIVING NATURAL GAS FROM NATURAL GAS LOCAL

9 DISTRIBUTION COMPANIES.—The owner or operator of a 

10 covered entity that takes delivery of natural gas from a nat11 ural gas local distribution company shall, not later than 

12 September 1 of each calendar year, notify such natural gas 

13 local distribution company in writing that such entity will 

14 qualify as a covered entity under this title for that calendar 

15 year. 

16 ‘‘(l) COMPLIANCE OBLIGATION.—For purposes of this 

17 title, the year of a compliance obligation is the year in 

18 which compliance is determined, not the year in which the 

19 greenhouse gas emissions occur or the covered entity has at20 tributable greenhouse gas emissions. 

21 ‘‘SEC. 723. PENALTY FOR NONCOMPLIANCE. 

22 ‘‘(a) ENFORCEMENT.—A violation of any prohibition 

23 of, requirement of, or regulation promulgated pursuant to 

24 this title shall be a violation of this Act. It shall be a viola25 tion of this Act for a covered entity to emit greenhouse gases, 


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1 and have attributable greenhouse gas emissions, in com2 bination, in excess of its allowable emissions level as pro3 vided in section 722(a). Each ton of carbon dioxide equiva4 lent for which a covered entity fails to demonstrate compli5 ance under section 722(b) shall be a separate violation. In 

6 the event that a covered entity fails to demonstrate compli7 ance at the expiration of a term of offset credits crediting 

8 term as required by section 722(d)(2)(D), the year of the 

9 violation shall be the year in which the term offset credit 

10 expires. 

11 ‘‘(b) EXCESS EMISSIONS PENALTY.— 

12 ‘‘(1) IN GENERAL.—The owner or operator of 

13 any covered entity that fails for any year to comply, 

14 on the deadline described in section 722(a) or (j), 

15 shall be liable for payment to the Administrator of an 

16 excess emissions penalty in the amount described in 

17 paragraph (2). 

18 ‘‘(2) AMOUNT.—The amount of an excess emis19 sions penalty required to be paid under paragraph 

20 (1) shall be equal to the product obtained by multi21 plying— 

22 ‘‘(A) the tons of carbon dioxide equivalent of 

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1 ator of a covered entity failed to comply under 

2 section 722(b) on the deadline; by 

3 ‘‘(B) twice the fair market value of emission 

4 allowances established for emissions occurring in 

5 the calendar year for which the emission allow6 ances were due. 

7 ‘‘(3) TIMING.—An excess emissions penalty re8 quired under this subsection shall be immediately due 

9 and payable to the Administrator, without demand, 

10 in accordance with regulations promulgated by the 

11 Administrator, which shall be issued not later than 2 

12 years after the date of enactment of this title. 

13 ‘‘(4) NO EFFECT ON LIABILITY.—An excess emis14 sions penalty due and payable by the owners or oper15 ators of a covered entity under this subsection shall 

16 not diminish the liability of the owners or operators 

17 for any fine, penalty, or assessment against the own18 ers or operators for the same violation under any 

19 other provision of this Act or any other law. 

20 ‘‘(c) EXCESS EMISSIONS ALLOWANCES.—The owner or 

21 operator of a covered entity that fails for any year to com22 ply on the deadline described in section 722(a) or (j) shall 

23 be liable to offset the covered entity’s excess combination of 

24 greenhouse gases emitted and attributable greenhouse gas 

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1 ing the following calendar year, or such longer period as 

2 the Administrator may prescribe. During the year in which 

3 the covered entity failed to comply, or any year thereafter, 

4 the Administrator may deduct the emission allowances re5 quired under this subsection to offset the covered entity’s 

6 excess actual or attributable emissions. 

7 ‘‘SEC. 724. TRADING. 

8 ‘‘(a) PERMITTED TRANSACTIONS.—Except as other9 wise provided in this title, the lawful holder of an emission 

10 allowance, compensatory allowance, or offset credit may, 

11 without restriction, sell, exchange, transfer, hold for compli12 ance in accordance with section 722, or request that the Ad13 ministrator retire the emission allowance, compensatory al14 lowance, or offset credit. 

15 ‘‘(b) NO RESTRICTION ON TRANSACTIONS.—The privi16 lege of purchasing, holding, selling, exchanging, transfer17 ring, and requesting retirement of emission allowances, 

18 compensatory allowances, or offset credits shall not be re19 stricted to the owners and operators of covered entities, ex20 cept as otherwise provided in this title. 

21 ‘‘(c) EFFECTIVENESS OF ALLOWANCE TRANSFERS.— 

22 No transfer of an allowance or offset credit shall be effective 

23 for purposes of this title until a certification of the transfer, 

24 signed by the designated representative of the transferor, is 


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1 received and recorded by the Administrator in accordance 

2 with regulations promulgated under section 721(h). 

3 ‘‘(d) ALLOWANCE TRACKING SYSTEM.—The regula4 tions promulgated under section 721(h) shall include a sys5 tem for issuing, recording, holding, and tracking allow6 ances, offset credits, and term offset credits that shall specify 

7 all necessary procedures and requirements for an orderly 

8 and competitive functioning of the allowance and offset 

9 credit markets. Such regulations shall provide for appro10 priate publication of the information in the system on the 

11 Internet. 

12 ‘‘SEC. 725. BANKING AND BORROWING. 

13 ‘‘(a) BANKING.—An emission allowance may be used 

14 to comply with section 722 or 723 for emissions in— 

15 ‘‘(1) the vintage year for the allowance; or 

16 ‘‘(2) any calendar year subsequent to the vintage 

17 year for the allowance. 

18 ‘‘(b) EXPIRATION.— 

19 ‘‘(1) REGULATIONS.—The Administrator may es20 tablish by regulation criteria and procedures for de21 termining whether, and for implementing a deter22 mination that, the expiration of an allowance, credit, 

23 or term offset credit established or issued by the Ad24 ministrator under this title, or expiration of the abil25 ity to use an international emission allowance to 


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1 comply with section 722, is necessary to ensure the 

2 authenticity and integrity of allowances, credits, or 

3 term offset credits or the allowance tracking system. 

4 ‘‘(2) GENERAL RULE.—An allowance, credit, or 

5 term offset credit established or issued by the Admin6 istrator under this title shall not expire unless— 

7 ‘‘(A) it is retired by the Administrator as 

8 required under this title; or 

9 ‘‘(B) it is determined to expire or to have 

10 expired by a specific date by the Administrator 

11 in accordance with regulations promulgated 

12 under paragraph (1). 

13 ‘‘(3) INTERNATIONAL EMISSION ALLOWANCES.— 

14 The ability to use an international emission allow15 ance to comply with section 722 shall not expire un16 less— 

17 ‘‘(A) the allowance is retired by the Admin18 istrator as required by this title; or 

19 ‘‘(B) the ability to use such allowance to 

20 meet such compliance obligation requirements is 

21 determined to expire or to have expired by a spe22 cific date by the Administrator in accordance 

23 with regulations promulgated under paragraph 

24 (1). 


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1 ‘‘(c) BORROWING FUTURE VINTAGE YEAR ALLOW2 ANCES.— 

3 ‘‘(1) BORROWING WITHOUT INTEREST.—In addi4 tion to the uses described in subsection (a), an emis5 sion allowance may be used to comply with section 

6 722(a) or 723 for emissions, production, importation, 

7 manufacture, or deliveries in the calendar year imme8 diately preceding the vintage year for the allowance. 

9 ‘‘(2) BORROWING WITH INTEREST.— 

10 ‘‘(A) IN GENERAL.—A covered entity may 

11 demonstrate compliance under subsection (b) in 

12 a specific calendar year for up to 15 percent of 

13 its emissions by holding emission allowances 

14 with a vintage year 1 to 5 years later than that 

15 calendar year. 

16 ‘‘(B) LIMITATIONS.—An emission allowance 

17 borrowed pursuant to this paragraph shall be an 

18 emission allowance that is established by the Ad19 ministrator for a specific future calendar year 

20 under section 721(a) and that is held by the bor21 rower. 

22 ‘‘(C) PREPAYMENT OF INTEREST.—For each 

23 emission allowance that an owner or operator of 

24 a covered entity borrows pursuant to this para25 graph, such owner or operator shall, at the time 


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1 it borrows the allowance, hold for retirement by 

2 the Administrator a quantity of emission allow3 ances that is equal to the product obtained by 

4 multiplying— 

5 ‘‘(i) 0.08; by 

6 ‘‘(ii) the number of years between the 

7 calendar year in which the allowance is 

8 being used to satisfy a compliance obliga9 tion and the vintage year of the allowance. 

10 ‘‘SEC. 726. MARKET STABILITY RESERVE. 

11 ‘‘(a) MARKET STABILITY RESERVE AUCTIONS.— 

12 ‘‘(1) IN GENERAL.—Once each quarter of each 

13 calendar year for which allowances are established 

14 under section 721(a), the Administrator shall auction 

15 market stability reserve allowances. 

16 ‘‘(2) RESTRICTION TO COVERED ENTITIES.—In 

17 each auction conducted under paragraph (1), only 

18 covered entities that the Administrator expects will be 

19 required to comply with section 722 in the following 

20 calendar year shall be eligible to make purchases. 

21 ‘‘(b) POOL OF EMISSION ALLOWANCES FOR MARKET

22 STABILITY RESERVE AUCTIONS.— 

23 ‘‘(1) FILLING THE MARKET STABILITY RESERVE

24 INITIALLY.—The Administrator shall, not later than 2 

25 years after the date of enactment of this title, establish 


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1 a market stability reserve account, and shall place in 

2 that account a quantity of emission allowances estab3 lished under section 771(d)(9). 

4 ‘‘(2) SUPPLEMENTING THE MARKET STABILITY

5 RESERVE.—The Administrator shall also— 

6 ‘‘(A) at the end of each calendar year, 

7 transfer to the market stability reserve account 

8 each emission allowance that was offered for sale 

9 but not sold at any auction conducted under sec10 tion 778; and 

11 ‘‘(B) transfer emission allowances estab12 lished under subsection (g) from auction pro13 ceeds, and deposit them into the market stability 

14 reserve, to the extent necessary to maintain the 

15 reserve at its original size. 

16 ‘‘(c) MINIMUM MARKET STABILITY RESERVE AUCTION

17 PRICE.— 

18 ‘‘(1) IN GENERAL.—At each market stability re19 serve auction, the Administrator shall offer emission 

20 allowances for sale beginning at a minimum price 

21 per emission allowance, which shall be known as the 

22 ‘minimum market stability reserve auction price’. 

23 ‘‘(2) INITIAL MINIMUM MARKET STABILITY RE24 SERVE AUCTION PRICES.—The minimum market sta25 bility reserve auction price shall be $28 (in constant 


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1 2005 dollars) for the market stability reserve auctions 

2 held in 2012. For the market stability reserve auc3 tions held in 2013 through 2017, the minimum mar4 ket stability reserve auction price shall be the market 

5 stability reserve auction price for the previous year 

6 increased by 5 percent plus the rate of inflation (as 

7 measured by the Consumer Price Index for All Urban 

8 Consumers). 

9 ‘‘(3) MINIMUM MARKET STABILITY RESERVE

10 AUCTION PRICE IN SUBSEQUENT YEARS.—For each 

11 market stability reserve auction held in 2018 and 

12 each year thereafter, the minimum market stability 

13 reserve auction price shall be the market stability re14 serve auction price for the previous year increased by 

15 7 percent, plus the rate of inflation (as measured by 

16 the Consumer Price Index for All Urban Consumers). 

17 ‘‘(d) QUANTITY OF EMISSION ALLOWANCES RELEASED

18 FROM THE MARKET STABILITY RESERVE.— 

19 ‘‘(1) INITIAL LIMITS.—Subject to paragraph (4), 

20 for each of calendar years 2012 through 2016, the an21 nual limit on the number of emission allowances from 

22 the market stability reserve account that may be auc23 tioned is an amount equal to 15 percent of the emis24 sion allowances established for that calendar year 

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1 set credits sold on consignment pursuant to subsection 

2 (h). 

3 ‘‘(2) LIMITS IN SUBSEQUENT YEARS.—Subject to 

4 paragraph (4), for calendar year 2017 and each year 

5 thereafter, the annual limit on the number of emis6 sion allowances from the market stability reserve ac7 count that may be auctioned is an amount equal to 

8 25 percent of the emission allowances established for 

9 that calendar year under section 721(a). This limit 

10 does not apply to offset credits sold on consignment 

11 pursuant to subsection (h). 

12 ‘‘(3) ALLOCATION OF LIMITATION.—One-fourth of 

13 each year’s annual market stability reserve auction 

14 limit under this subsection shall be made available for 

15 auction in each quarter. Any allowances from the 

16 market stability reserve account that are made avail17 able for sale in a quarterly auction and not sold shall 

18 be rolled over and added to the quantity available for 

19 sale in the following quarter, except that allowances 

20 not sold at auction in the fourth quarter of a year 

21 shall not be rolled over to the following calendar 

22 year’s auctions, but shall be returned to the market 

23 stability reserve account. 

24 ‘‘(4) AUTHORITY TO ADJUST LIMITATION.—The 

25 Administrator may adjust the limits in paragraphs 


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1 (1) or (2) if the Administrator determines an adjust2 ment is required to prevent disruptively high prices 

3 or to preserve the integrity of the market stability re4 serve. 

5 ‘‘(e) PURCHASE LIMIT.— 

6 ‘‘(1) IN GENERAL.—Except as provided in para7 graph (2) or (3), the annual number of emission al8 lowances that a covered entity may purchase at the 

9 market stability reserve auctions in each calendar 

10 year shall not exceed 20 percent of the covered entity’s 

11 emissions during the most recent year for which al12 lowances or credits were retired under section 722. 

13 ‘‘(2) 2012 LIMIT.—For calendar year 2012, the 

14 maximum aggregate number of emission allowances 

15 that a covered entity may purchase from that year’s 

16 market stability reserve auctions shall be 20 percent 

17 of the covered entity’s greenhouse gas emissions that 

18 the covered entity reported to the registry established 

19 under section 713 for 2011 and that would be subject 

20 to section 722(a) if occurring in later calendar years. 

21 ‘‘(3) NEW ENTRANTS.—The Administrator shall, 

22 by regulation, establish a separate purchase limit ap23 plicable to entities that expect to become a covered en24 tity in the year of the auction, permitting them to 

25 purchase emission allowances at the market stability 


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1 reserve auctions in their first calendar year of oper2 ation in an amount of at least 20 percent of their ex3 pected combined emissions and attributable green4 house gas emissions for that year. 

5 ‘‘(f) DELEGATION OR CONTRACT.—Pursuant to regula6 tions under this section, the Administrator may, by delega7 tion or contract, provide for the conduct of market stability 

8 reserve auctions under the Administrator’s supervision by 

9 other departments or agencies of the Federal Government 

10 or by nongovernmental agencies, groups, or organizations. 

11 ‘‘(g) USE OF AUCTION PROCEEDS.— 

12 ‘‘(1) DEPOSIT IN MARKET STABILITY RESERVE

13 FUND.—The proceeds from market stability reserve 

14 auctions shall be placed in the Market Stability Re15 serve Fund established by subsection (j), and shall be 

16 available without further appropriation or fiscal year 

17 limitation for the purposes described in this sub18 section. 

19 ‘‘(2) OFFSET CREDITS.—The Administrator shall 

20 use the proceeds from each market stability reserve 

21 auction to purchase offset credits, including domestic 

22 offset credits and international offset credits issued 

23 pursuant to section 744. The Administrator shall re24 tire those offset credits and establish a number of 

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1 national offset credits so retired. Emission allowances 

2 established under this paragraph shall be in addition 

3 to those established under section 721(a). 

4 ‘‘(3) EMISSION ALLOWANCES.—The Adminis5 trator shall deposit emission allowances established 

6 under paragraph (2) in the market stability reserve, 

7 except that, with respect to any such emission allow8 ances in excess of the amount necessary to fill the 

9 market stability reserve to its original size, the Ad10 ministrator shall— 

11 ‘‘(A) except as provided in subparagraph 

12 (B), assign a vintage year to the emission allow13 ance, which shall be no earlier than the year in 

14 which the allowance is established under para15 graph (2) and shall treat such allowances as ones 

16 that are not designated for distribution or auc17 tion; and 

18 ‘‘(B) to the extent any such allowances can19 not be assigned a vintage year because of the 

20 limitation in paragraph (4), retire the allow21 ances. 

22 ‘‘(4) LIMITATION.—In no case may the Adminis23 trator assign under paragraph (3)(A) more emission 

24 allowances to a vintage year than the number of 

25 emission allowances from that vintage year that were 


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1 placed in the market stability reserve account under 

2 subsection (b)(1). 

3 ‘‘(h) AVAILABILITY OF OFFSET CREDITS FOR AUC4 TION.— 

5 ‘‘(1) IN GENERAL.—The regulations promulgated 

6 under section 721(h) shall allow any entity holding 

7 offset credits to request that the Administrator include 

8 such offset credits in an upcoming market stability 

9 reserve auction. The regulations shall provide that— 

10 ‘‘(A) upon sale of such offset credits, the Ad11 ministrator shall retire those offset credits, and 

12 establish and provide to the purchasers a number 

13 of emission allowances equal to the number of 

14 offset credits so retired, which allowances shall be 

15 in addition to those established under section 

16 721(a); and 

17 ‘‘(B) for offset credits sold pursuant to this 

18 subsection, the proceeds for the entity that offered 

19 the offset credits for sale shall be the lesser of— 

20 ‘‘(i) the average daily closing price for 

21 offset credits sold on registered exchanges (or 

22 if such price is unavailable, the average 

23 price as determined by the Administrator) 

24 during the six months prior to the market 

25 stability reserve auction at which they were 


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1 auctioned, with the remaining funds col2 lected upon the sale of the offset credits de3 posited in the Treasury; and 

4 ‘‘(ii) the amount received for the offset 

5 credits at the auction. 

6 ‘‘(2) PROCEEDS.—For offset credits sold pursu7 ant to this subsection, notwithstanding section 3302 

8 of title 31, United States Code, or any other provision 

9 of law, within 90 days of receipt, the United States 

10 shall transfer the proceeds from the auction, as de11 fined in paragraph (1)(D), to the entity that offered 

12 the offset credits for sale. No funds transferred from 

13 a purchaser to a seller of offset credits under this 

14 paragraph shall be held by any officer or employee of 

15 the United States or treated for any purpose as public 

16 monies. 

17 ‘‘(3) PRICING.—When the Administrator acts 

18 under this subsection as the agent of an entity in pos19 session of offset credits, the Administrator is not obli20 gated to obtain the highest price possible for the offset 

21 credits, and instead shall auction such offset credits 

22 in the same manner and pursuant to the same rules 

23 (except as modified in paragraph (1)) as set forth for 

24 auctioning market stability reserve allowances. Enti25 ties requesting that such offset credits be offered for 


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1 sale at a market stability reserve auction may not set 

2 a minimum reserve price for their offset credits that 

3 is different than the minimum market stability re4 serve auction price set pursuant to subsection (c). 

5 ‘‘(i) INITIAL REGULATIONS.—Not later than 24 

6 months after the date of enactment of this title, the Admin7 istrator shall promulgate regulations, in consultation with 

8 other appropriate agencies, governing the auction of allow9 ances under this section. Such regulations shall include the 

10 following requirements: 

11 ‘‘(1) FREQUENCY; FIRST AUCTION.—Auctions 

12 shall be held four times per year at regular intervals, 

13 with the first auction to be held no later than March 

14 31, 2012. 

15 ‘‘(2) AUCTION FORMAT.—Auctions shall follow a 

16 single-round, sealed-bid, uniform price format. 

17 ‘‘(3) PARTICIPATION; FINANCIAL ASSURANCE.— 

18 Auctions shall be open to any covered entity eligible 

19 to purchase emission allowances at the auction under 

20 subsection (a)(2), except that the Administrator may 

21 establish financial assurance requirements to ensure 

22 that auction participants can and will perform on 

23 their bids. 

24 ‘‘(4) DISCLOSURE OF BENEFICIAL OWNERSHIP.— 

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1 close the person or entity sponsoring or benefitting 

2 from the bidder’s participation in the auction if such 

3 person or entity is, in whole or in part, other than 

4 the bidder. 

5 ‘‘(5) PURCHASE LIMITS.—No person may, di6 rectly or in concert with another participant, pur7 chase more than 20 percent of the allowances offered 

8 for sale at any quarterly auction. 

9 ‘‘(6) PUBLICATION OF INFORMATION.—After the 

10 auction, the Administrator shall, in a timely fashion, 

11 publish the identities of winning bidders, the quantity 

12 of allowances obtained by each winning bidder, and 

13 the auction clearing price. 

14 ‘‘(7) OTHER REQUIREMENTS.—The Adminis15 trator may include in the regulations such other re16 quirements or provisions as the Administrator, in 

17 consultation with other agencies as appropriate, con18 siders appropriate to promote effective, efficient, 

19 transparent, and fair administration of auctions 

20 under this section. 

21 ‘‘(j) MARKET STABILITY RESERVE FUND.—There are 

22 established in the Treasury of the United States a fund to 

23 be known as the ‘Market Stability Reserve Fund’. 

24 ‘‘(k) REVISION OF REGULATIONS.—The Administrator 

25 may, at any time, in consultation with other agencies as 


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1 appropriate, revise the initial regulations promulgated 

2 under subsection (i). Such revised regulations need not meet 

3 the requirements identified in subsection (i) if the Adminis4 trator determines that an alternative auction design would 

5 be more effective, taking into account factors including costs 

6 of administration, transparency, fairness, and risks of col7 lusion or manipulation. In determining whether and how 

8 to revise the initial regulations under this subsection, the 

9 Administrator shall not consider maximization of revenues 

10 to the Federal Government. 

11 ‘‘SEC. 727. PERMITS. 

12 ‘‘(a) PERMIT PROGRAM.—For stationary sources sub13 ject to title V of this Act, that are covered entities, the provi14 sions of this title shall be implemented by permits issued 

15 to such covered entities (and enforced) in accordance with 

16 the provisions of title V, as modified by this title. Any such 

17 permit issued by the Administrator, or by a State with an 

18 approved permit program, shall require the owner or oper19 ator of a covered entity to hold emission allowances or offset 

20 credits at least equal to the total annual amount of carbon 

21 dioxide equivalents for its combined emissions and attrib22 utable greenhouse gas emissions to which section 722 ap23 plies. No such permit shall be issued that is inconsistent 

24 with the requirements of this title, and title V as applicable. 

25 Nothing in this section regarding compliance plans or in 


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1 title V shall be construed as affecting allowances or offset 

2 credits. Submission of a statement by the owner or operator, 

3 or the designated representative of the owners and opera4 tors, of a covered entity that the owners and operators will 

5 hold emission allowances or offset credits for the entity’s 

6 combined emissions and attributable greenhouse gas emis7 sions to which section 722 applies shall be deemed to meet 

8 the proposed and approved planning requirements of title 

9 V. Recordation by the Administrator of transfers of emis10 sion allowances shall amend automatically all applicable 

11 proposed or approved permit applications, compliance 

12 plans, and permits. 

13 ‘‘(b) MULTIPLE OWNERS.—No permit shall be issued 

14 under this section and no allowances or offset credits shall 

15 be disbursed under this title to a covered entity or any other 

16 person until the designated representative of the owners or 

17 operators has filed a certificate of representation with re18 gard to matters under this title, including the holding and 

19 distribution of emission allowances and the proceeds of 

20 transactions involving emission allowances. Where there are 

21 multiple holders of a legal or equitable title to, or a lease22 hold interest in, such a covered entity or other entity or 

23 where a utility or industrial customer purchases power 

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1 pendent power production facility that is a covered entity, 

2 the certificate shall state— 

3 ‘‘(1) that emission allowances and the proceeds of 

4 transactions involving emission allowances will be 

5 deemed to be held or distributed in proportion to each 

6 holder’s legal, equitable, leasehold, or contractual res7 ervation or entitlement; or 

8 ‘‘(2) if such multiple holders have expressly pro9 vided for a different distribution of emission allow10 ances by contract, that emission allowances and the 

11 proceeds of transactions involving emission allow12 ances will be deemed to be held or distributed in ac13 cordance with the contract. 

14 A passive lessor, or a person who has an equitable interest 

15 through such lessor, whose rental payments are not based, 

16 either directly or indirectly, upon the revenues or income 

17 from the covered entity or other entity shall not be deemed 

18 to be a holder of a legal, equitable, leasehold, or contractual 

19 interest for the purpose of holding or distributing emission 

20 allowances as provided in this subsection, during either the 

21 term of such leasehold or thereafter, unless expressly pro22 vided for in the leasehold agreement. Except as otherwise 

23 provided in this subsection, where all legal or equitable title 

24 to or interest in a covered entity, or other entity, is held 

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1 sion allowances received by the entity are deemed to be held 

2 for that person. 

3 ‘‘(c) PROHIBITION.—It shall be unlawful for any per4 son to operate any stationary source subject to the require5 ments of this section except in compliance with the terms 

6 and requirements of a permit issued by the Administrator 

7 or a State with an approved permit program in accordance 

8 with this section. For purposes of this subsection, compli9 ance, as provided in section 504(f), with a permit issued 

10 under title V which complies with this title for covered enti11 ties shall be deemed compliance with this subsection as well 

12 as section 502(a). 

13 ‘‘(d) RELIABILITY.—Nothing in this section or title V 

14 shall be construed as requiring termination of operations 

15 of a stationary source that is a covered entity for failure 

16 to have an approved permit, or compliance plan, that is 

17 consistent with the requirements in the second and fifth sen18 tences of subsection (a) concerning the holding of emission 

19 allowances, compensatory allowances, international emis20 sion allowances, or offset allowances, except that any such 

21 covered entity may be subject to the applicable enforcement 

22 provision of section 113. 

23 ‘‘(e) REGULATIONS.—The Administrator shall promul24 gate regulations to implement this section. To provide for 

25 permits required under this section, each State in which 


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1 one or more stationary sources and that are covered entities 

2 are located shall submit, in accordance with this section 

3 and title V, revised permit programs for approval. 

4 ‘‘SEC. 728. INTERNATIONAL EMISSION ALLOWANCES. 

5 ‘‘(a) QUALIFYING PROGRAMS.—The Administrator, in 

6 consultation with the Secretary of State, may by rule des7 ignate an international climate change program as a quali8 fying international program if— 

9 ‘‘(1) the program is run by a national or supra10 national foreign government, and imposes a manda11 tory absolute tonnage limit on greenhouse gas emis12 sions from 1 or more foreign countries, or from 1 or 

13 more economic sectors in such a country or countries; 

14 and 

15 ‘‘(2) the program is at least as stringent as the 

16 program established by this title, including provisions 

17 to ensure at least comparable monitoring, compliance, 

18 enforcement, quality of offsets, and restrictions on the 

19 use of offsets. 

20 ‘‘(b) DISQUALIFIED ALLOWANCES.—An international 

21 emission allowance may not be held under section 722(d)(3) 

22 if it is in the nature of an offset instrument or allowance 

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1 tion, that are not subject to the mandatory absolute tonnage 

2 limits referred to in subsection (a)(1). 

3 ‘‘(c) RETIREMENT.— 

4 ‘‘(1) ENTITY CERTIFICATION.—The owner or op5 erator of an entity that holds an international emis6 sion allowance under section 722(d)(3) shall certify to 

7 the Administrator that such international emission 

8 allowance has not previously been used to comply 

9 with any foreign, international, or domestic green10 house gas regulatory program. 

11 ‘‘(2) RETIREMENT.— 

12 ‘‘(A) FOREIGN AND INTERNATIONAL REGU13 LATORY ENTITIES.—The Administrator, in con14 sultation with the Secretary of State, shall seek, 

15 by whatever means appropriate, including agree16 ments and technical cooperation on allowance 

17 tracking, to ensure that any relevant foreign, 

18 international, and domestic regulatory entities— 

19 ‘‘(i) are notified of the use, for pur20 poses of compliance with this title, of any 

21 international emission allowance; and 

22 ‘‘(ii) provide for the disqualification of 

23 such international emission allowance for 

24 any subsequent use under the relevant for25 eign, international, or domestic greenhouse 


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1 gas regulatory program, regardless of 

2 whether such use is a sale, exchange, or sub3 mission to satisfy a compliance obligation. 

4 ‘‘(B) DISQUALIFICATION FROM FURTHER

5 USE.—The Administrator shall ensure that, once 

6 an international emission allowance has been 

7 disqualified or otherwise used for purposes of 

8 compliance with this title, such allowance shall 

9 be disqualified from any further use under this 

10 title. 

11 ‘‘(d) USE LIMITATIONS.—The Administrator may, by 

12 rule, modify the percentage applicable to international 

13 emission allowances under section 722(d)(3), consistent 

14 with the purposes of the Clean Energy Jobs and American 

15 Power Act. 

16 ‘‘PART D—OFFSETS 

17 ‘‘SEC. 731. OFFSETS INTEGRITY ADVISORY BOARD. 

18 ‘‘(a) ESTABLISHMENT.—Not later than 30 days after 

19 the date of enactment of this title, the President shall estab20 lish an independent Offsets Integrity Advisory Board. The 

21 Advisory Board shall make recommendations to the Presi22 dent for use in promulgating and revising regulations 

23 under this part, and for ensuring the overall environmental 

24 integrity of the programs established pursuant to those reg25 ulations. 


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1 ‘‘(b) MEMBERSHIP.—The Advisory Board shall be 

2 comprised of at least nine members. Each member shall be 

3 qualified by education, training, and experience to evaluate 

4 scientific and technical information on matters referred to 

5 the Board under this section. The President shall appoint 

6 Advisory Board members, including a chair and vice-chair 

7 of the Advisory Board. Terms shall be 3 years in length, 

8 except for initial terms, which may be up to 5 years in 

9 length to allow staggering. Members may be reappointed 

10 only once for an additional 3-year term, and such second 

11 term may follow directly after a first term. 

12 ‘‘(c) ACTIVITIES.—The Advisory Board established 

13 pursuant to subsection (a) shall— 

14 ‘‘(1) provide recommendations, not later than 90 

15 days after the Advisory Board’s establishment and pe16 riodically thereafter, to the President regarding offset 

17 project types that should be considered for eligibility 

18 under section 733, taking into consideration relevant 

19 scientific and other issues, including— 

20 ‘‘(A) the availability of a representative 

21 data set for use in developing the activity base22 line; 

23 ‘‘(B) the potential for accurate quantifica24 tion of greenhouse gas reduction, avoidance, or 

25 sequestration for an offset project type; 


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1 ‘‘(C) the potential level of scientific and 

2 measurement uncertainty associated with an off3 set project type; 

4 ‘‘(D) any beneficial or adverse environ5 mental, public health, welfare, social, economic, 

6 or energy effects associated with an offset project 

7 type; 

8 ‘‘(E) the extent to which, as of the date of 

9 submission of the report, the project or activity 

10 types within each category— 

11 ‘‘(i) are required by law (including a 

12 regulation); or 

13 ‘‘(ii) represent business-as-usual (ab14 sent funding from offset credits) practices 

15 for a relevant land area, industry sector, or 

16 forest, soil or facility type; 

17 ‘‘(2) make available to the President its advice 

18 and comments on offset methodologies that should be 

19 considered under regulations promulgated pursuant 

20 to subsection (a) and (b) of section 734, including 

21 methodologies to address the issues of additionality, 

22 activity baselines, measurement, leakage, uncertainty, 

23 permanence, and environmental integrity; 

24 ‘‘(3) make available to the President, and other 

25 relevant Federal agencies, its advice and comments 


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1 regarding scientific, technical, and methodological 

2 issues specific to the issuance of international offset 

3 credits under section 744; 

4 ‘‘(4) make available to the President, and other 

5 relevant Federal agencies, its advice and comments 

6 regarding scientific, technical, and methodological 

7 issues associated with the implementation of this 

8 part; 

9 ‘‘(5) make available to the President its advice 

10 and comments on areas in which further knowledge is 

11 required to appraise the adequacy of existing, revised, 

12 or proposed methodologies for use under this part, 

13 and describe the research efforts necessary to provide 

14 the required information; and 

15 ‘‘(6) make available to the President its advice 

16 and comments on other ways to improve or safeguard 

17 the environmental integrity of programs established 

18 under this part. 

19 ‘‘(d) SCIENTIFIC REVIEW OF OFFSET AND DEFOREST20 ATION REDUCTION PROGRAMS.—Not later than January 1, 

21 2017, and at five-year intervals thereafter, the Advisory 

22 Board shall submit to the President and make available to 

23 the public an analysis of relevant scientific and technical 

24 information related to this part. The Advisory Board shall 

25 review approved and potential methodologies, scientific 


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1 studies, offset project monitoring, offset project verification 

2 reports, and audits related to this part, and evaluate the 

3 net emissions effects of implemented offset projects. The Ad4 visory Board shall recommend changes to offset methodolo5 gies, protocols, or project types, or to the overall offset pro6 gram under this part, to ensure that offset credits issued 

7 by the President do not compromise the integrity of the an8 nual emission reductions established under section 703, and 

9 to avoid or minimize adverse effects to human health or 

10 the environment. 

11 ‘‘SEC. 732. ESTABLISHMENT OF OFFSETS PROGRAM. 

12 ‘‘(a) REGULATIONS.—Not later than 2 years after the 

13 date of enactment of this title, the President, in consultation 

14 with appropriate Federal agencies and taking into consid15 eration the recommendations of the Advisory Board, shall 

16 promulgate regulations establishing a program for the 

17 issuance of offset credits in accordance with the require18 ments of this part. The President shall periodically revise 

19 these regulations as necessary to meet the requirements of 

20 this part. 

21 ‘‘(b) REQUIREMENTS.—The regulations described in 

22 subsection (a) shall— 

23 ‘‘(1) authorize the issuance of offset credits with 

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1 ductions or avoidance of greenhouse gas emissions, or 

2 sequestration of greenhouse gases; 

3 ‘‘(2) ensure that such offset credits represent 

4 verifiable and additional greenhouse gas emission re5 ductions or avoidance, or increases in sequestration; 

6 ‘‘(3) ensure that offset credits issued for seques7 tration offset projects are only issued for greenhouse 

8 gas reductions that are permanent; 

9 ‘‘(4) provide for the implementation of the re10 quirements of this part; 

11 ‘‘(5) include as reductions in greenhouse gases 

12 reductions achieved through the destruction of meth13 ane and its conversion to carbon dioxide, and reduc14 tions achieved through destruction of 

15 chlorofluorocarbons or other ozone depleting sub16 stances, if permitted by the President under section 

17 619(b)(9) and subject to the conditions specified in 

18 section 619(b)(9), based on the carbon dioxide equiva19 lent value of the substance destroyed; and 

20 ‘‘(6) establish a process to accept and respond to 

21 comments from third parties regarding programs es22 tablished under this part in a timely manner. 

23 ‘‘(c) COORDINATION TO MINIMIZE NEGATIVE EF24 FECTS.—In promulgating and implementing regulations 

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1 ing projects, if necessary) to avoid or minimize, to the max2 imum extent practicable, adverse effects on human health 

3 or the environment resulting from the implementation of 

4 offset projects under this part. 

5 ‘‘(d) OFFSET REGISTRY.—The President shall estab6 lish within the allowance tracking system established under 

7 section 724(d) an Offset Registry for qualifying offset 

8 projects and offset credits issued with respect thereto under 

9 this part. 

10 ‘‘(e) LEGAL STATUS OF OFFSET CREDIT.—An offset 

11 credit does not constitute a property right. 

12 ‘‘(f) FEES.—The President shall assess fees payable by 

13 offset project developers in an amount necessary to cover 

14 the administrative costs and the enforcement costs to the 

15 Environmental Protection Agency and the Department of 

16 Justice of carrying out the activities under this part. 

17 Amounts collected for such fees shall be available to the 

18 President and the Attorney General for carrying out the 

19 activities under this part to the extent provided in advance 

20 in appropriations Acts. 

21 ‘‘(g) SECRETARY OF AGRICULTURE.—The President 

22 shall designate the Secretary of Agriculture to serve as the 

23 lead agency in— 

24 ‘‘(1) the implementation of elements of the offset 

25 program, in coordination with the Administrator, for 


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1 agriculture and forestry projects in the United States 

2 authorized under this part, including project types 

3 and methodologies; and 

4 ‘‘(2) working directly with farmers, ranchers, 

5 and foresters to implement agriculture and forestry 

6 projects. 

7 ‘‘SEC. 733. ELIGIBLE PROJECT TYPES. 

8 ‘‘(a) LIST OF ELIGIBLE PROJECT TYPES.— 

9 ‘‘(1) IN GENERAL.—As part of the regulations 

10 promulgated under section 732(a), the President shall 

11 establish, and may periodically revise, a list of types 

12 of projects eligible to generate offset credits, including 

13 international offset credits, under this part. 

14 ‘‘(2) ADVISORY BOARD RECOMMENDATIONS.—In 

15 determining the eligibility of project types, the Presi16 dent shall take into consideration the recommenda17 tions of the Advisory Board. If a list established 

18 under this section differs from the recommendations of 

19 the Advisory Board, the regulations promulgated 

20 under section 732(a) shall include a justification for 

21 the discrepancy. 

22 ‘‘(3) INITIAL DETERMINATION.—The President 

23 shall establish the initial eligibility list under para24 graph (1) not later than one year after the date of en25 actment of this title for which there are well developed 


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1 methodologies that the President determines would 

2 meet the criteria of section 734. 

3 ‘‘(4) PROJECT TYPES TO BE CONSIDERED FOR

4 INITIAL LIST.—In determining the initial list, the 

5 President shall give priority to consideration of offset 

6 project types that are recommended by the Advisory 

7 Board, and shall consider— 

8 ‘‘(A) methane collection and combustion 

9 projects at active coal mines; 

10 ‘‘(B) methane collection and combustion 

11 projects at landfills; 

12 ‘‘(C) capture of venting, flaring, and fugi13 tive emissions from oil and natural gas systems; 

14 ‘‘(D) nonlandfill methane collection, com15 bustion and avoidance projects involving organic 

16 waste streams that would have otherwise emitted 

17 methane in the atmosphere, including manure 

18 management and biogas capture and combus19 tion; 

20 ‘‘(E) projects involving afforestation or re21 forestation of acreage not forested as of January 

22 1, 2009; 

23 ‘‘(F) forest management resulting in an in24 crease in forest carbon stores, including har25 vested wood products; 


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1 ‘‘(G) agricultural, grassland, and rangeland 

2 sequestration and management practices, includ3 ing— 

4 ‘‘(i) altered tillage practices, including 

5 avoided abandonment of such practices; 

6 ‘‘(ii) winter cover cropping, continuous 

7 cropping, and other means to increase bio8 mass returned to soil in lieu of planting fol9 lowed by fallowing; 

10 ‘‘(iii) reduction of nitrogen fertilizer 

11 use or increase in nitrogen use efficiency; 

12 ‘‘(iv) reduction in the frequency and 

13 duration of flooding of rice paddies; 

14 ‘‘(v) reduction in carbon emissions 

15 from organic soils; 

16 ‘‘(vi) reduction in greenhouse gas emis17 sions from manure and effluent; 

18 ‘‘(vii) reduction in greenhouse gas 

19 emissions due to changes in animal man20 agement practices, including dietary modi21 fications; 

22 ‘‘(viii) planting and cultivation of per23 manent tree crops; 

24 ‘‘(ix) greenhouse gas emission reduc25 tions from improvements and upgrades to 


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1 mobile or stationary equipment (including 

2 engines); 

3 ‘‘(x) practices to reduce and eliminate 

4 soil tillage; 

5 ‘‘(xi) reductions in greenhouse gas 

6 emissions through restoration of wetlands, 

7 forestland, and grassland; and 

8 ‘‘(xii) sequestration of greenhouse gases 

9 through management of tree crops; and 

10 ‘‘(H) changes in carbon stocks attributed to 

11 land use change and forestry activities, includ12 ing— 

13 ‘‘(i) management of peatland or wet14 land; 

15 ‘‘(ii) conservation of grassland and for16 ested land; 

17 ‘‘(iii) improved forest management, in18 cluding accounting for carbon stored in 

19 wood products; 

20 ‘‘(iv) reduced deforestation or avoided 

21 forest conversion; 

22 ‘‘(v) urban tree-planting and mainte23 nance; 

24 ‘‘(vi) agroforestry; and 


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1 ‘‘(vii) adaptation of plant traits or 

2 new technologies that increase sequestration 

3 by forests. 

4 ‘‘(5) METHODOLOGIES.—In issuing methodolo5 gies pursuant to section 734, the President shall give 

6 priority to methodologies for offset types included on 

7 the initial eligibility list. 

8 ‘‘(b) MODIFICATION OF LIST.—The President— 

9 ‘‘(1) shall add additional project types to the list 

10 not later than 2 years after the date of enactment of 

11 this title; 

12 ‘‘(2) may at any time, by rule, add a project 

13 type to the list established under subsection (a) if the 

14 President, in consultation with appropriate Federal 

15 agencies and taking into consideration the rec16 ommendations of the Advisory Board, determines that 

17 the project type can generate additional reductions or 

18 avoidance of greenhouse gas emissions, or sequestra19 tion of greenhouse gases, subject to the requirements of 

20 this part; 

21 ‘‘(3) may at any time, by rule, determine that 

22 a project type on the list does not meet the require23 ments of this part, and remove a project type from 

24 the list established under subsection (a), in consulta25 tion with appropriate Federal agencies and taking 


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1 into consideration any recommendations of the Advi2 sory Board; and 

3 ‘‘(4) shall consider adding to or removing from 

4 the list established under subsection (a), at a min5 imum, project types proposed to the President— 

6 ‘‘(A) by petition pursuant to subsection (c); 

7 or 

8 ‘‘(B) by the Advisory Board. 

9 ‘‘(c) PETITION PROCESS.—Any person may petition 

10 the President to modify the list established under subsection 

11 (a) by adding or removing a project type pursuant to sub12 section (b). Any such petition shall include a showing by 

13 the petitioner that there is adequate data to establish that 

14 the project type does or does not meet the requirements of 

15 this part. Not later than 12 months after receipt of such 

16 a petition, the President shall either grant or deny the peti17 tion and publish a written explanation of the reasons for 

18 the President’s decision. The President may not deny a peti19 tion under this subsection on the basis of inadequate agency 

20 resources or time for review. 

21 ‘‘SEC. 734. REQUIREMENTS FOR OFFSET PROJECTS. 

22 ‘‘(a) METHODOLOGIES.—As part of the regulations 

23 promulgated under section 732(a), the President shall estab24 lish, for each type of offset project listed as eligible under 

25 section 733, the following: 


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1 ‘‘(1) ADDITIONALITY.—A standardized method2 ology for determining the additionality of greenhouse 

3 gas emission reductions or avoidance, or greenhouse 

4 gas sequestration, achieved by an offset project of that 

5 type. Such methodology shall ensure, at a minimum, 

6 that any greenhouse gas emission reduction or avoid7 ance, or any greenhouse gas sequestration, is consid8 ered additional only to the extent that it results from 

9 activities that— 

10 ‘‘(A) are not required by or undertaken to 

11 comply with any law, including any regulation 

12 or consent order; 

13 ‘‘(B) were not commenced prior to January 

14 1, 2009, except in the case of— 

15 ‘‘(i) offset project activities that com16 menced after January 1, 2001, and were 

17 registered as of the date of enactment of this 

18 title under an offset program with respect to 

19 which the President has made an affirma20 tive determination under section 740(a)(2); 

21 or 

22 ‘‘(ii) activities that are readily revers23 ible, with respect to which the President 

24 may set an alternative earlier date under 

25 this subparagraph that is not earlier than 


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1 January 1, 2001, where the President deter2 mines that setting such an alternative date 

3 may produce an environmental benefit by 

4 removing an incentive to cease and then re5 initiate activities that began prior to Janu6 ary 1, 2009; 

7 ‘‘(C) are not receiving support under section 

8 323 of division A, or section 206 of division B, 

9 of the Clean Energy Jobs and American Power 

10 Act; and 

11 ‘‘(D) exceed the activity baseline established 

12 under paragraph (2). 

13 ‘‘(2) ACTIVITY BASELINES.—A standardized 

14 methodology for establishing activity baselines for off15 set projects of that type. The President shall set activ16 ity baselines to reflect a conservative estimate of busi17 ness-as-usual performance or practices for the relevant 

18 type of activity such that the baseline provides an 

19 adequate margin of safety to ensure the environ20 mental integrity of offsets calculated in reference to 

21 such baseline. 

22 ‘‘(3) QUANTIFICATION METHODS.—A standard23 ized methodology for determining the extent to which 

24 greenhouse gas emission reductions or avoidance, or 

25 greenhouse gas sequestration, achieved by an offset 


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1 project of that type exceed a relevant activity baseline, 

2 including protocols for monitoring and accounting for 

3 uncertainty. 

4 ‘‘(4) LEAKAGE.—A standardized methodology for 

5 accounting for and mitigating potential leakage, if 

6 any, from an offset project of that type, taking uncer7 tainty into account. 

8 ‘‘(b) ACCOUNTING FOR REVERSALS.— 

9 ‘‘(1) ACCOUNTING.— 

10 ‘‘(A) IN GENERAL.—After issuance of offset 

11 credits for a project, pursuant to section 733, the 

12 offset project developer shall, in a timely man13 ner, report any reversal that occurs. 

14 ‘‘(B) INTENTIONAL REVERSALS.—An offset 

15 project developer shall not engage in repeated in16 tentional reversals. 

17 ‘‘(2) REGULATIONS.—As part of the regulations 

18 promulgated under section 732(a), for each type of se19 questration project listed under section 733, the Presi20 dent shall establish requirements to account for and 

21 address reversals, including— 

22 ‘‘(A) a requirement to report any reversal 

23 with respect to an offset project for which offset 

24 credits have been issued under this part; 


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1 ‘‘(B) provisions to require emission allow2 ances to be held in amounts to fully compensate 

3 for greenhouse gas emissions attributable to re4 versals, and to assign responsibility for holding 

5 such emission allowances; 

6 ‘‘(C) provisions to discourage repeated in7 tentional reversals by offset project developers, 

8 including but not limited to the assessment of 

9 administrative fees, temporary suspension, or 

10 disqualification of an offset project developer 

11 from the program; and 

12 ‘‘(D) any other provisions the President de13 termines necessary to account for and address re14 versals. 

15 ‘‘(3) MECHANISMS.—The President shall pre16 scribe mechanisms to ensure that any sequestration 

17 with respect to which an offset credit is issued under 

18 this part results in a permanent net increase in se19 questration, and that full account is taken of any ac20 tual or potential reversal of such sequestration, with 

21 an adequate margin of safety. The President shall 

22 prescribe at least one of the following mechanisms to 

23 meet the requirements of this paragraph: 

24 ‘‘(A) An offsets reserve, pursuant to para25 graph (4). 


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1 ‘‘(B) Insurance that provides for purchase 

2 and provision to the President for retirement of 

3 an amount of offset credits or emission allow4 ances equal in number to the tons of carbon di5 oxide equivalents of greenhouse gas emissions re6 leased due to reversal. 

7 ‘‘(C) Another mechanism that the President 

8 determines satisfies the requirements of this part. 

9 ‘‘(4) OFFSETS RESERVE.— 

10 ‘‘(A) IN GENERAL.—An offsets reserve re11 ferred to in paragraph (3)(A) is a program 

12 under which, before issuance of offset credits 

13 under this part, the President shall subtract and 

14 reserve from the quantity to be issued a quantity 

15 of offset credits based on the risk of reversal. The 

16 President shall— 

17 ‘‘(i) hold these reserved offset credits in 

18 the offsets reserve; and 

19 ‘‘(ii) register the holding of the reserved 

20 offset credits in the Offset Registry estab21 lished under section 732(d). 

22 ‘‘(B) PROJECT REVERSAL.— 

23 ‘‘(i) IN GENERAL.—If a reversal has 

24 occurred with respect an offset project for 

25 which offset credits are reserved under this 


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1 paragraph, the President shall remove offset 

2 credits or emission allowances from the off3 sets reserve and cancel them to fully account 

4 for the tons of carbon dioxide equivalent 

5 that are no longer sequestered. 

6 ‘‘(ii) INTENTIONAL REVERSALS.—If the 

7 President determines that a reversal was in8 tentional, the offset project developer for the 

9 relevant offset project shall place into the 

10 offsets reserve a quantity of offset credits, or 

11 combination of offset credits and emission 

12 allowances, equal in number to the number 

13 of reserve offset credits that were canceled 

14 due to the reversal pursuant to clause (i). 

15 ‘‘(iii) UNINTENTIONAL REVERSALS.—If 

16 the President determines that a reversal was 

17 unintentional, the offset project developer 

18 for the relevant offset project shall place into 

19 the offsets reserve a quantity of offset cred20 its, or combination of offset credits and 

21 emission allowances, equal in number to 

22 half the number of offset credits that were 

23 reserved for that offset project, or half the 

24 number of reserve offset credits that were 


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1 canceled due to the reversal pursuant to 

2 clause (i), whichever is less. 

3 ‘‘(iv) PETITION.—Any person may pe4 tition the President for a determination 

5 that an offsets reversal has occurred. Any 

6 such petition shall include a showing by the 

7 petitioner that there is adequate data or 

8 other evidence to support the petition. Not 

9 later than 90 days after the date of receipt 

10 of the petition, the President shall take final 

11 action determining either that the reversal 

12 has occurred or that the reversal has not oc13 curred. Such determination shall be accom14 panied by a statement of the basis for the 

15 determination. 

16 ‘‘(C) USE OF RESERVED OFFSET CRED17 ITS.—Offset credits placed into the offsets reserve 

18 under this paragraph may not be used to comply 

19 with section 722. 

20 ‘‘(5) TERM OFFSET CREDITS.— 

21 ‘‘(A) APPLICABILITY.—With respect to a 

22 practice listed under section 733 that sequesters 

23 greenhouse gases and has a crediting period of 

24 not more than 5 years, the President may ad25 dress reversals pursuant to this paragraph in 


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1 lieu of permanently accounting for reversals pur2 suant to paragraphs (2) and (3). 

3 ‘‘(B) ACCOUNTING FOR REVERSALS.—For 

4 such practices or projects implementing the prac5 tices described in subparagraph (A), the Presi6 dent shall require only reversals that occur dur7 ing the crediting period to be accounted for and 

8 addressed pursuant to paragraphs (2) and (3). 

9 ‘‘(C) CREDITS ISSUED.—For practices or 

10 projects regulated pursuant to subparagraph (B), 

11 the President shall issue under section 737 a 

12 term offset credit, in lieu of an offset credit, for 

13 each ton of carbon dioxide equivalent that has 

14 been sequestered. 

15 ‘‘(c) CREDITING PERIODS.— 

16 ‘‘(1) IN GENERAL.—As part of the regulations 

17 promulgated under section 732(a), for each offset 

18 project type, the President shall specify a crediting 

19 period, and establish provisions for petitions for new 

20 crediting periods, in accordance with this subsection. 

21 ‘‘(2) DURATION.— 

22 ‘‘(A) IN GENERAL.—The crediting period 

23 shall be not less than 5 and not greater than 10 

24 years for any project type other than those in25 volving sequestration or term offsets. 


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1 ‘‘(B) FORESTRY PROJECTS.—The crediting 

2 period for a forestry offset project shall not ex3 ceed 20 years. 

4 ‘‘(C) TERM OFFSET CREDITS.—The cred5 iting period for a term offset credit issued shall 

6 not exceed 5 years. 

7 ‘‘(3) ELIGIBILITY.—An offset project shall be eli8 gible to generate offset credits under this part only 

9 during the project’s crediting period. During such 

10 crediting period, the project shall remain eligible to 

11 generate offset credits, subject to the methodologies 

12 and project type eligibility list that applied as of the 

13 date of project approval under section 735, except as 

14 provided in paragraph (4). 

15 ‘‘(4) PETITION FOR NEW CREDITING PERIOD.— 

16 An offset project developer may petition for a new 

17 crediting period to commence after termination of a 

18 crediting period, subject to the methodologies and 

19 project type eligibility list in effect at the time when 

20 such petition is submitted. A petition may not be sub21 mitted under this paragraph more than 18 months 

22 before the end of the pending crediting period. The 

23 President may grant such petition after public notice 

24 and opportunity for comment. The President may 


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1 limit the number of new crediting periods available 

2 for projects of particular project types. 

3 ‘‘(d) ENVIRONMENTAL INTEGRITY.—In establishing the 

4 requirements under this section, the President shall apply 

5 conservative assumptions or methods to maximize the cer6 tainty that the environmental integrity of the greenhouse 

7 gas limitations established under section 703 is not com8 promised. 

9 ‘‘(e) PRE-EXISTING METHODOLOGIES.—In promul10 gating requirements under this section, the President shall 

11 give due consideration to methodologies for offset projects 

12 existing as of the date of enactment of this title. 

13 ‘‘(f) ADDED PROJECT TYPES.—The President shall es14 tablish methodologies described in subsection (a), and, as 

15 applicable, requirements and mechanisms for reversals as 

16 described in subsection (b), for any project type that is 

17 added to the list pursuant to section 733. 

18 ‘‘SEC. 735. APPROVAL OF OFFSET PROJECTS. 

19 ‘‘(a) APPROVAL PETITION.—An offset project developer 

20 shall submit an offset project approval petition signed by 

21 a responsible official (who shall certify the accuracy of the 

22 information submitted) and providing such information as 

23 the President requires to determine whether the offset project 

24 is eligible for issuance of offset credits under rules promul25 gated pursuant to this part. 


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1 ‘‘(b) TIMING.—An approval petition shall be submitted 

2 to the President under subsection (a) not later than the time 

3 at which an offset project’s first verification report is sub4 mitted under section 736. 

5 ‘‘(c) APPROVAL PETITION REQUIREMENTS.—As part 

6 of the regulations promulgated under section 732, the Presi7 dent shall include provisions for, and shall specify, the re8 quired components of an offset project approval petition re9 quired under subsection (a), which shall include— 

10 ‘‘(1) designation of an offset project developer; 

11 ‘‘(2) designation of a party who is authorized to 

12 provide access to the appropriate officials or an au13 thorized representative to the offset project; and 

14 ‘‘(3) any other information that the President 

15 considers to be necessary to achieve the purposes of 

16 this part. 

17 ‘‘(d) APPROVAL AND NOTIFICATION.—Not later than 

18 90 days after receiving a complete approval petition under 

19 subsection (a), the President shall make the approval peti20 tion publicly available on the internet, approve or deny the 

21 petition in writing, and, if the petition is denied, provide 

22 the reasons for the denial and make the President’s decision 

23 publicly available on the internet. After an offset project 

24 is approved, the offset project developer shall not be required 


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1 to resubmit an approval petition during the offset project’s 

2 crediting period, except as provided in section 734(c)(4). 

3 ‘‘(e) APPEAL.—The President shall establish proce4 dures for appeal and review of determinations made under 

5 subsection (d). 

6 ‘‘(f) VOLUNTARY PREAPPROVAL REVIEW.—The Presi7 dent may establish a voluntary preapproval review proce8 dure, to allow an offset project developer to request the 

9 President to conduct a preliminary eligibility review for 

10 an offset project. Findings of such reviews shall not be bind11 ing upon the President. The voluntary preapproval review 

12 procedure— 

13 ‘‘(1) shall require the offset project developer to 

14 submit such basic project information as the Presi15 dent requires to provide a meaningful review; and 

16 ‘‘(2) shall require a response from the President 

17 not later than 6 weeks after receiving a request for re18 view under this subsection. 

19 ‘‘SEC. 736. VERIFICATION OF OFFSET PROJECTS. 

20 ‘‘(a) IN GENERAL.—As part of the regulations promul21 gated under section 732(a), the President shall establish re22 quirements, including protocols, for verification of the 

23 quantity of greenhouse gas emission reductions or avoid24 ance, or sequestration of greenhouse gases, resulting from 

25 an offset project. The regulations shall require that an offset 


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1 project developer shall submit a report, prepared by a third2 party verifier accredited under subsection (d), providing 

3 such information as the President requires to determine the 

4 quantity of greenhouse gas emission reductions or avoid5 ance, or sequestration of greenhouse gas, resulting from the 

6 offset project. 

7 ‘‘(b) SCHEDULE.—The President shall prescribe a 

8 schedule for the submission of verification reports under 

9 subsection (a). 

10 ‘‘(c) VERIFICATION REPORT REQUIREMENTS.—The 

11 President shall specify the required components of a 

12 verification report required under subsection (a), which 

13 shall include— 

14 ‘‘(1) the name and contact information for a des15 ignated representative for the offset project developer; 

16 ‘‘(2) the quantity of greenhouse gas reduced, 

17 avoided, or sequestered; 

18 ‘‘(3) the methodologies applicable to the project 

19 pursuant to section 734; 

20 ‘‘(4) a certification that the project meets the ap21 plicable requirements; 

22 ‘‘(5) a certification establishing that the conflict 

23 of interest requirements in the regulations promul24 gated under subsection (d)(1) have been complied 

25 with; and 


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1 ‘‘(6) any other information that the President 

2 considers to be necessary to achieve the purposes of 

3 this part. 

4 ‘‘(d) VERIFIER ACCREDITATION.— 

5 ‘‘(1) IN GENERAL.—As part of the regulations 

6 promulgated under section 732(a), the President shall 

7 establish a process and requirements for periodic ac8 creditation of third-party verifiers to ensure that such 

9 verifiers are professionally qualified and have no con10 flicts of interest with offset project developers. 

11 ‘‘(2) STANDARDS.— 

12 ‘‘(A) AMERICAN NATIONAL STANDARDS IN13 STITUTE ACCREDITATION.—The President may 

14 accredit, or accept for purposes of accreditation 

15 under this subsection, verifiers accredited under 

16 the American National Standards Institute 

17 (ANSI) accreditation program in accordance 

18 with ISO 14065. The President shall accredit, or 

19 accept for accreditation, verifiers under this sub20 paragraph only if the President finds that the 

21 American National Standards Institute accredi22 tation program provides sufficient assurance 

23 that the requirements of this part will be met. 

24 ‘‘(B) EPA ACCREDITATION.—As part of the 

25 regulations promulgated under section 732(a), 


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1 the President may establish accreditation stand2 ards for verifiers under this subsection, and may 

3 establish related training and testing programs 

4 and requirements. 

5 ‘‘(3) PUBLIC ACCESSIBILITY.—Each verifier 

6 meeting the requirements for accreditation in accord7 ance with this subsection shall be listed in a publicly 

8 accessible database, which shall be maintained and 

9 updated by the President. 

10 ‘‘(4) REVOCATION.—The regulations concerning 

11 accreditation of third-party verifiers required under 

12 paragraph (1) shall establish a process for the Presi13 dent to revoke the accreditation of any third-party 

14 verifier that the President finds fails to maintain pro15 fessional qualifications or to avoid a conflict of inter16 est, or for other good cause. 

17 ‘‘SEC. 737. ISSUANCE OF OFFSET CREDITS. 

18 ‘‘(a) DETERMINATION AND NOTIFICATION.—Not later 

19 than 90 days after receiving a complete verification report 

20 under section 736, the President shall— 

21 ‘‘(1) make the report publicly available on the 

22 Internet; 

23 ‘‘(2) make a determination of the quantity of 

24 greenhouse gas emissions reduced or avoided, or 


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1 greenhouse gases sequestered, resulting from an offset 

2 project approved under section 735; and 

3 ‘‘(3) notify the offset project developer in writing 

4 of such determination and make such determination 

5 publicly available on the Internet. 

6 ‘‘(b) ISSUANCE OF OFFSET CREDITS.—The President 

7 shall issue one offset credit to an offset project developer for 

8 each ton of carbon dioxide equivalent that the President has 

9 determined has been reduced, avoided, or sequestered during 

10 the period covered by a verification report submitted in ac11 cordance with section 736, only if— 

12 ‘‘(1) the President has approved the offset project 

13 pursuant to section 735; and 

14 ‘‘(2) the relevant emissions reduction, avoidance, 

15 or sequestration has— 

16 ‘‘(A) already occurred, during the offset 

17 project’s crediting period; and 

18 ‘‘(B) occurred after January 1, 2009. 

19 ‘‘(c) APPEAL.—The President shall establish proce20 dures for appeal and review of determinations made under 

21 subsection (a). 

22 ‘‘(d) TIMING.—Offset credits meeting the criteria estab23 lished in subsection (b) shall be issued not later than 2 

24 weeks following the verification determination made by the 

25 President under subsection (a). 


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1 ‘‘(e) REGISTRATION.—The President shall assign a 

2 unique serial number to and register each offset credit to 

3 be issued in the Offset Registry established under section 

4 732(d). 

5 ‘‘SEC. 738. AUDITS. 

6 ‘‘(a) IN GENERAL.—The President shall, on an ongo7 ing basis, conduct random audits of offset projects and offset 

8 credits. The President shall conduct audits of the practices 

9 of third-party verifiers. In each year, the President shall 

10 conduct audits, at minimum, for a representative sample 

11 of project types and geographic areas. 

12 ‘‘(b) DELEGATION.—The President may delegate to a 

13 State or Indian tribe the responsibility for conducting au14 dits under this section if the President finds that the pro15 gram proposed by the State or Indian tribe provides assur16 ances equivalent to those provided by the auditing program 

17 of the President, and that the integrity of the offset program 

18 under this part will be maintained. Nothing in this sub19 section shall prevent the President from conducting any 

20 audit the President considers necessary and appropriate. 

21 ‘‘(c) AUDIT REQUIREMENTS.—As part of the regula22 tions promulgated under section 732(a), the President shall 

23 establish requirements and protocols for an auditing pro24 gram, whether undertaken by the President or an author25 ized representative, concerning project developers, third 


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1 party verifiers, and reports submitted by those persons, in2 cluding the offset project approval petition and verification 

3 report. Such regulations shall include— 

4 ‘‘(1) the components of the offset project, which 

5 shall be evaluated against the offset approval petition 

6 and the verification report; 

7 ‘‘(2) the minimum experience or training of the 

8 auditors; 

9 ‘‘(3) the form in which reports shall be com10 pleted; 

11 ‘‘(4) requirements for delegating auditing func12 tions to States or Indian tribes, including requiring 

13 periodic reports from States or Indian tribes on their 

14 auditing activities and findings; and 

15 ‘‘(5) any other information that the appropriate 

16 officials considers to be necessary to achieve the pur17 pose of the Act. 

18 ‘‘SEC. 739. PROGRAM REVIEW AND REVISION. 

19 ‘‘At least once every 5 years, the President shall review 

20 and, based on new or updated information and taking into 

21 consideration the recommendations of the Advisory Board, 

22 update and revise— 

23 ‘‘(1) the list of eligible project types established 

24 under section 733; 


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1 ‘‘(2) the methodologies established, including spe2 cific activity baselines, under section 734(a); 

3 ‘‘(3) the reversal requirements and mechanisms 

4 established or prescribed under section 734(b); 

5 ‘‘(4) measures to improve the accountability of 

6 the offsets program; and 

7 ‘‘(5) any other requirements established under 

8 this part to ensure the environmental integrity and 

9 effective operation of this part. 

10 ‘‘SEC. 740. EARLY OFFSET SUPPLY. 

11 ‘‘(a) PROJECTS REGISTERED UNDER OTHER GOVERN12 MENT-RECOGNIZED PROGRAMS.—Except as provided in 

13 subsection (b) or (c), after public notice and opportunity 

14 for comment, the President shall issue one offset credit for 

15 each ton of carbon dioxide equivalent emissions reduced, 

16 avoided, or sequestered— 

17 ‘‘(1) under an offset project that was started 

18 after January 1, 2001; 

19 ‘‘(2) for which a credit was issued under any 

20 regulatory or voluntary greenhouse gas emission offset 

21 program that the President determines— 

22 ‘‘(A) was established under State or tribal 

23 law or regulation prior to January 1, 2009, or 

24 has been approved by the President pursuant to 

25 subsection (e); 


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1 ‘‘(B) has developed offset project type stand2 ards, methodologies, and protocols through a 

3 public consultation process or a peer review 

4 process; 

5 ‘‘(C) has made available to the public 

6 standards, methodologies, and protocols that re7 quire that credited emission reductions, avoid8 ance, or sequestration are permanent, additional, 

9 verifiable, and enforceable; 

10 ‘‘(D) requires that all emission reductions, 

11 avoidance, or sequestration be verified by a State 

12 regulatory agency or an accredited third-party 

13 independent verification body; 

14 ‘‘(E) requires that all credits issued are reg15 istered in a publicly accessible registry, with in16 dividual serial numbers assigned for each ton of 

17 carbon dioxide equivalent emission reductions, 

18 avoidance, or sequestration; and 

19 ‘‘(F) ensures that no credits are issued for 

20 activities for which the entity administering the 

21 program, or a program administrator or rep22 resentative, has funded, solicited, or served as a 

23 fund administrator for the development of, the 

24 project or activity that caused the emission re25 duction, avoidance, or sequestration; and 


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1 ‘‘(3) for which the credit described in paragraph 

2 (2) is transferred to the President. 

3 ‘‘(b) INELIGIBLE CREDITS.—Subsection (a) shall not 

4 apply to offset credits that have expired or have been re5 tired, canceled, or used for compliance under a program 

6 established under State or tribal law or regulation. 

7 ‘‘(c) LIMITATION.—Notwithstanding subsection (a)(1), 

8 offset credits shall be issued under this section— 

9 ‘‘(1) only for reductions or avoidance of green10 house gas emissions, sequestration of greenhouse gases, 

11 or destruction of chlorofluorocarbons (subject to the 

12 conditions specified in section 619(b)(9) and based on 

13 the carbon dioxide equivalent value of the substance 

14 destroyed), that occur after January 1, 2009; and 

15 ‘‘(2) only until the date that is 3 years after the 

16 date of enactment of this title, or the date that regula17 tions promulgated under section 732(a) take effect, 

18 whichever occurs sooner. 

19 ‘‘(d) RETIREMENT OF CREDITS.—The President shall 

20 seek to ensure that offset credits described in subsection 

21 (a)(2) are retired for purposes of use under a program de22 scribed in subsection (b). 

23 ‘‘(e) OTHER PROGRAMS.— 

24 ‘‘(1) IN GENERAL.—Offset programs that ei25 ther— 


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1 ‘‘(A) were not established under State or 

2 tribal law; or 

3 ‘‘(B) were not established prior to January 

4 1, 2009; 

5 but that otherwise meet all of the criteria of sub6 section (a)(2) may apply to the President to be ap7 proved under this subsection as an eligible program 

8 for early offset credits under this section. 

9 ‘‘(2) APPROVAL.—The President shall approve 

10 any such program that the President determines has 

11 criteria and methodologies of at least equal stringency 

12 to the criteria and methodologies of the programs es13 tablished under State or tribal law that the President 

14 determines meet the criteria of subsection (a)(2). The 

15 President shall approve types of offsets under any 

16 such program that are subject to criteria and meth17 odologies of at least equal stringency to the criteria 

18 and methodologies for such types of offsets applied 

19 under the programs established under State or tribal 

20 law that the President determines meet the criteria of 

21 subsection (a)(2). The President shall make a deter22 mination on any application received under this sub23 section by not later than 180 days from the date of 

24 receipt of the application. 


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1 ‘‘SEC. 741. ENVIRONMENTAL CONSIDERATIONS. 

2 ‘‘If the President lists forestry or other relevant land 

3 management-related offset projects as eligible offset project 

4 types under section 733, the President, in consultation with 

5 appropriate Federal agencies, shall promulgate regulations 

6 to establish criteria for such offset projects— 

7 ‘‘(1) to ensure that native species are given pri8 mary consideration in such projects; 

9 ‘‘(2) to enhance biological diversity in such 

10 projects; 

11 ‘‘(3) to prohibit the use of federally designated or 

12 State-designated noxious weeds; 

13 ‘‘(4) to prohibit the use of a species listed by a 

14 regional, State, or tribal invasive plant authority 

15 within the applicable region, State, or land of Indian 

16 tribes; 

17 ‘‘(5) in the case of forestry offset projects, in ac18 cordance with widely accepted, environmentally sus19 tainable forestry practices; 

20 ‘‘(6) to ensure that the offset project area was not 

21 converted from native ecosystems, such as a forest, 

22 grassland, scrubland or wetland, to generate offsets, 

23 unless such conversation took place at least 10 years 

24 prior to the date of enactment of this title or before 

25 January 1, 2009, whichever date is earlier; and 


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1 ‘‘(7) to the maximum extent practicable, ensure 

2 that the use of offset credits would be eligible to sat3 isfy emission reduction commitments made by the 

4 United States in multilateral agreements, such as the 

5 United Nations Framework Convention on Climate 

6 Change, done at New York on May 9, 1992 (or any 

7 successor agreement). 

8 ‘‘SEC. 742. TRADING. 

9 ‘‘Section 724 shall apply to the trading of offset cred10 its. 

11 ‘‘SEC. 743. OFFICE OF OFFSETS INTEGRITY. 

12 ‘‘(a) ESTABLISHMENT.—There is established within 

13 the Office of the Assistant Attorney General of the Environ14 ment and Natural Resources Division in the Department 

15 of Justice a Carbon Offsets Integrity Unit, to be headed by 

16 a Special Counsel (hereinafter referred to as the ‘Special 

17 Counsel’). The Carbon Offsets Integrity Unit and the Spe18 cial Counsel shall be responsible to and shall report directly 

19 to the Assistant Attorney General of the Environment and 

20 Natural Resources Division. 

21 ‘‘(b) APPOINTMENT.—The Special Counsel shall be ap22 pointed by the President, by and with the advice and con23 sent of the Senate. 

24 ‘‘(c) RESPONSIBILITIES.—The Special Counsel shall— 


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1 ‘‘(1) supervise and coordinate investigations and 

2 civil enforcement within the Department of Justice of 

3 the carbon offsets program under this part; 

4 ‘‘(2) ensure that Federal law relating to civil en5 forcement of the carbon offsets program is used to the 

6 fullest extent authorized; and 

7 ‘‘(3) ensure that adequate resources are made 

8 available for the investigation and enforcement of 

9 civil violations of the carbon offsets program. 

10 ‘‘(d) COMPENSATION.—The Special Counsel shall be 

11 paid at the basic pay payable for level V of the Executive 

12 Schedule under section 5316 of title 5, United States Code. 

13 ‘‘(e) ASSIGNMENT OF PERSONNEL.—There shall be as14 signed to the Carbon Offsets Integrity Unit such personnel 

15 as the Attorney General determines to be necessary to pro16 vide an appropriate level of enforcement activity in the area 

17 of carbon offsets. 

18 ‘‘SEC. 744. INTERNATIONAL OFFSET CREDITS. 

19 ‘‘(a) IN GENERAL.—The Administrator, in consulta20 tion with the Secretary of State and the Administrator of 

21 the United States Agency for International Development, 

22 may issue, in accordance with this section, international 

23 offset credits based on activities that reduce or avoid green24 house gas emissions, or increase sequestration of greenhouse 

25 gases, in a developing country. Such credits may be issued 


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1 for projects pursuant to the requirements of this part or 

2 as provided in subsection (c), (d), or (e). 

3 ‘‘(b) ISSUANCE.— 

4 ‘‘(1) REGULATIONS.—Not later than 2 years 

5 after the date of enactment of this title, the Adminis6 trator, in consultation with the Secretary of State, the 

7 Administrator of the United States Agency for Inter8 national Development, and any other appropriate 

9 Federal agency, and taking into consideration the rec10 ommendations of the Advisory Board, shall promul11 gate regulations for implementing this section, taking 

12 into consideration specific factors relevant to the de13 termination of eligible international offset project 

14 types and the implementation of international meth15 odologies for each offset type approved. Except as oth16 erwise provided in this section, the issuance of inter17 national offset credits under this section shall be sub18 ject to the requirements of this part. 

19 ‘‘(2) REQUIREMENTS FOR INTERNATIONAL OFF20 SET CREDITS.—The Administrator may issue inter21 national offset credits only if— 

22 ‘‘(A) the United States is a party to a bilat23 eral or multilateral agreement or arrangement 

24 that includes the country in which the project or 

25 measure achieving the relevant greenhouse gas 


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1 emission reduction or avoidance, or greenhouse 

2 gas sequestration, has occurred; 

3 ‘‘(B) such country is a developing country; 

4 and 

5 ‘‘(C) such agreement or arrangement— 

6 ‘‘(i) ensures that all of the require7 ments of this part apply to the issuance of 

8 international offset credits under this sec9 tion; 

10 ‘‘(ii) provides for the appropriate dis11 tribution of international offset credits 

12 issued; and 

13 ‘‘(iii) provides that the offset project 

14 developer be eligible to receive service of 

15 process in the United States for the purpose 

16 of all civil and regulatory actions in Fed17 eral courts, if such service is made in ac18 cordance with the Federal rules for service 

19 of process in the States in which the case or 

20 regulatory action is brought. 

21 ‘‘(3) SUPPLEMENTAL INTERNATIONAL OFFSET

22 CATEGORIES.— 

23 ‘‘(A) IN GENERAL.—In order to ensure a 

24 sufficient supply of international offsets and to 

25 reduce the cost of compliance with this title, the 


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1 Administrator may establish categories of inter2 national offsets in addition to those described in 

3 subsections (c), (d), and (e), if— 

4 ‘‘(i) for 2 consecutive years, the auc5 tion price for allowances reaches the market 

6 stability reserve auction price under section 

7 726(c); and 

8 ‘‘(ii) the Administrator determines that 

9 the total amount of international offsets 

10 held by covered entities for each of the 2 

11 years referred to in clause (i) does not ex12 ceed the limit on international offsets estab13 lished under section 722(d)(1)(B)(iii). 

14 ‘‘(B) SUPPLEMENTAL CATEGORIES.— 

15 ‘‘(i) IN GENERAL.—Any supplemental 

16 categories of international offsets established 

17 pursuant to subparagraph (A) shall— 

18 ‘‘(I) satisfy all applicable provi19 sions of this part, including subsection 

20 (b)(2) of this section and sections 733 

21 and 734; and 

22 ‘‘(II) meet the criteria described 

23 in clause (ii). 

24 ‘‘(ii) CRITERIA.—The criteria referred 

25 to in clause (i)(II) are that— 


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1 ‘‘(I) the country in which the ac2 tivities in the offset category would 

3 take place has developed and is imple4 menting a low carbon development 

5 plan that includes provisions for the 

6 activities described in the offset cat7 egory; 

8 ‘‘(II) the activities in the offset 

9 category are not activities included 

10 under subsection (c), (d) or (e); and 

11 ‘‘(III) the activities in the offset 

12 category satisfy specific criteria rel13 evant to methodologies and institu14 tional and technical capacities associ15 ated with developing country contexts 

16 to ensure adequate treatment of leak17 age, additionality, and permanence. 

18 ‘‘(c) SECTOR-BASED CREDITS.— 

19 ‘‘(1) IN GENERAL.—In order to minimize the po20 tential for leakage and to encourage countries to take 

21 nationally appropriate mitigation actions to reduce 

22 or avoid greenhouse gas emissions, or sequester green23 house gases, the Administrator, in consultation with 

24 the Secretary of State and the Administrator of the 


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1 United States Agency for International Development, 

2 shall— 

3 ‘‘(A) identify sectors, or combinations of 

4 sectors, within specific countries with respect to 

5 which the issuance of international offset credits 

6 on a sectoral basis is appropriate; and 

7 ‘‘(B) issue international offset credits for 

8 such sectors only on a sectoral basis. 

9 ‘‘(2) IDENTIFICATION OF SECTORS.— 

10 ‘‘(A) GENERAL RULE.—For purposes of 

11 paragraph (1)(A), a sectoral basis shall be ap12 propriate for activities— 

13 ‘‘(i) in countries that have compara14 tively high greenhouse gas emissions, or 

15 comparatively greater levels of economic de16 velopment; and 

17 ‘‘(ii) that, if located in the United 

18 States, would be within a sector subject to 

19 the compliance obligation under section 722. 

20 ‘‘(B) FACTORS.—In determining the sectors 

21 and countries for which international offset cred22 its should be awarded only on a sectoral basis, 

23 the Administrator, in consultation with the Sec24 retary of State and the Administrator of the 


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1 United States Agency for International Develop2 ment, shall consider the following factors: 

3 ‘‘(i) The country’s gross domestic prod4 uct. 

5 ‘‘(ii) The country’s total greenhouse gas 

6 emissions. 

7 ‘‘(iii) Whether the comparable sector of 

8 the United States economy is covered by the 

9 compliance obligation under section 722. 

10 ‘‘(iv) The heterogeneity or homogeneity 

11 of sources within the relevant sector. 

12 ‘‘(v) Whether the relevant sector pro13 vides products or services that are sold in 

14 internationally competitive markets. 

15 ‘‘(vi) The risk of leakage if inter16 national offset credits were issued on a 

17 project-level basis, instead of on a sectoral 

18 basis, for activities within the relevant sec19 tor. 

20 ‘‘(vii) The capability of accurately 

21 measuring, monitoring, reporting, and 

22 verifying the performance of sources across 

23 the relevant sector. 

24 ‘‘(viii) Such other factors as the Ad25 ministrator, in consultation with the SecVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01399 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 retary of State and the Administrator of the 

2 United States Agency for International De3 velopment, determines are appropriate to— 

4 ‘‘(I) ensure the integrity of the 

5 United States greenhouse gas emissions 

6 limitations established under section 

7 703; and 

8 ‘‘(II) encourage countries to take 

9 nationally appropriate mitigation ac10 tions to reduce or avoid greenhouse gas 

11 emissions, or sequester greenhouse 

12 gases. 

13 ‘‘(ix) The issuance of offsets for activi14 ties that are— 

15 ‘‘(I) in addition to nationally ap16 propriate mitigation actions taken by 

17 developing countries pursuant to the 

18 low-carbon development plans of the 

19 countries; and 

20 ‘‘(II) on a sectoral basis. 

21 ‘‘(3) SECTORAL BASIS.— 

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

23 term ‘sectoral basis’ means the issuance of inter24 national offset credits only for the quantity of 

25 sector-wide reductions or avoidance of greenhouse 


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1 gas emissions, or sector-wide increases in seques2 tration of greenhouse gases, achieved across the 

3 relevant sector or sectors of the economy relative 

4 to a baseline level of emissions established in an 

5 agreement or arrangement described in sub6 section (b)(2)(A) for the sector. 

7 ‘‘(B) BASELINE.—The baseline for a sector 

8 shall— 

9 ‘‘(i) be established at levels of green10 house gas emissions lower than would occur 

11 under a business-as-usual scenario, taking 

12 into account relevant domestic or inter13 national policies or incentives to reduce 

14 greenhouse gas emissions; 

15 ‘‘(ii) be used to determine 

16 additionality and performance; 

17 ‘‘(iii) account for all significant 

18 sources of emissions from a sector; 

19 ‘‘(iv) be adjusted over time to reflect 

20 changing circumstances; 

21 ‘‘(v) be developed taking into consider22 ation such factors as— 

23 ‘‘(I) any established emissions 

24 performance level for the sector; 


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1 ‘‘(II) the current performance of 

2 the sector in the country; 

3 ‘‘(III) expected future trends of 

4 the sector in the country; and 

5 ‘‘(IV) historical data and other 

6 factors to ensure additionality; and 

7 ‘‘(vi) be designed to produce significant 

8 deviations from business-as-usual emissions, 

9 consistent with nationally appropriate 

10 mitigation commitments or actions, in a 

11 way that equitably contributes to meeting 

12 thresholds identified in section 705(e)(2). 

13 ‘‘(d) CREDITS ISSUED BY AN INTERNATIONAL BODY.— 

14 ‘‘(1) IN GENERAL.—The Administrator, in con15 sultation with the Secretary of State, may issue inter16 national offset credits in exchange for instruments in 

17 the nature of offset credits that are issued by an inter18 national body established pursuant to the United Na19 tions Framework Convention on Climate Change, to 

20 a protocol to such Convention, or to a treaty that suc21 ceeds such Convention. The Administrator may issue 

22 international offset credits under this subsection only 

23 if, in addition to the requirements of subsection (b), 

24 the Administrator has determined that the inter25 national body that issued the instruments has impleVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01402 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 mented substantive and procedural requirements for 

2 the relevant project type that provide equal or greater 

3 assurance of the integrity of such instruments as is 

4 provided by the requirements of this part. Beginning 

5 on January 1, 2016, the Administrator shall issue no 

6 offset credit pursuant to this subsection if the activity 

7 generating the greenhouse gas emission reductions or 

8 avoidance, or greenhouse gas sequestration, occurs in 

9 a country and sector identified by the Administrator 

10 under subsection (c), unless the offset credit issued by 

11 the international body is consistent with section 

12 744(c). 

13 ‘‘(2) RETIREMENT.—The Administrator, in con14 sultation with the Secretary of State, shall seek, by 

15 whatever means appropriate, including agreements, 

16 arrangements, or technical cooperation with the inter17 national issuing body described in paragraph (1), to 

18 ensure that such body— 

19 ‘‘(A) is notified of the Administrator’s 

20 issuance, under this subsection, of an inter21 national offset credit in exchange for an instru22 ment issued by such international body; and 

23 ‘‘(B) provides, to the extent feasible, for the 

24 disqualification of the instrument issued by such 

25 international body for subsequent use under any 


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1 relevant foreign or international greenhouse gas 

2 regulatory program, regardless of whether such 

3 use is a sale, exchange, or submission to satisfy 

4 a compliance obligation. 

5 ‘‘(e) OFFSETS FROM REDUCED DEFORESTATION.— 

6 ‘‘(1) REQUIREMENTS.—The Administrator, in 

7 accordance with the regulations promulgated under 

8 subsection (b)(1) and an agreement or arrangement 

9 described in subsection (b)(2)(A), shall issue inter10 national offset credits for greenhouse gas emission re11 ductions achieved through activities to reduce deforest12 ation only if, in addition to the requirements of sub13 section (b)— 

14 ‘‘(A) the activity occurs in— 

15 ‘‘(i) a country listed by the Adminis16 trator pursuant to paragraph (2); 

17 ‘‘(ii) a state or province listed by the 

18 Administrator pursuant to paragraph (5); 

19 or 

20 ‘‘(iii) a country listed by the Adminis21 trator pursuant to paragraph (6); 

22 ‘‘(B) except as provided in paragraph (5) or 

23 (6), the quantity of the international offset cred24 its is determined by comparing the national 

25 emissions from deforestation relative to a naVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01404 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 tional deforestation baseline for that country es2 tablished, in accordance with an agreement or 

3 arrangement described in subsection (b)(2)(A), 

4 pursuant to paragraph (4); 

5 ‘‘(C) the reduction in emissions from defor6 estation has occurred before the issuance of the 

7 international offset credit and, taking into con8 sideration relevant international standards, has 

9 been demonstrated using ground-based inven10 tories, remote sensing technology, and other 

11 methodologies to ensure that all relevant carbon 

12 stocks are accounted; 

13 ‘‘(D) the Administrator has made appro14 priate adjustments, such as discounting for any 

15 additional uncertainty, to account for cir16 cumstances specific to the country, including its 

17 technical capacity described in paragraph 

18 (2)(A); 

19 ‘‘(E) the Administrator has determined that 

20 the country within which the activity occurs has 

21 in place a publicly available strategic plan that 

22 includes the criteria listed in paragraph (2)(C); 

23 ‘‘(F) the activity is designed, carried out, 

24 and managed— 


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1 ‘‘(i) in accordance with forest manage2 ment practices that— 

3 ‘‘(I) improve the livelihoods of for4 est communities; 

5 ‘‘(II) maintain the natural bio6 diversity, resilience, and carbon stor7 age capacity of forests; and 

8 ‘‘(III) do not adversely impact the 

9 permanence of forest carbon stocks or 

10 emission reductions; 

11 ‘‘(ii) to promote or restore native forest 

12 species and ecosystems where practicable, 

13 and to avoid the introduction of invasive 

14 nonnative species; 

15 ‘‘(iii) in a manner that gives due re16 gard to the rights and interests of local com17 munities, indigenous peoples, forest-depend18 ent communities, and vulnerable social 

19 groups; 

20 ‘‘(iv) with consultations with, and full 

21 participation of, local communities, indige22 nous peoples, and forest-dependent commu23 nities, in affected areas, as partners and 

24 primary stakeholders, prior to and during 


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1 the design, planning, implementation, and 

2 monitoring and evaluation of activities; 

3 ‘‘(v) with transparent and equitable 

4 sharing of profits and benefits derived from 

5 offset credits with local communities, indig6 enous peoples, and forest-dependent commu7 nities; 

8 ‘‘(vi) with full transparency, third9 party independent oversight, and public 

10 dissemination of related financial and con11 tractual arrangements, and 

12 ‘‘(vii) so that the social and environ13 mental impacts of these activities are mon14 itored and reported in sufficient detail to 

15 allow appropriate officials to determine 

16 compliance with the requirements of this 

17 section; 

18 ‘‘(G) the reduction otherwise satisfies and is 

19 consistent with any relevant requirements estab20 lished by an agreement reached under the aus21 pices of the United Nations Framework Conven22 tion on Climate Change, done at New York on 

23 May 9, 1992; and 

24 ‘‘(H) in the case that offsets are determined 

25 by comparing the national emissions from deforVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01407 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 estation relative to a national, state-level, or 

2 province-level deforestation baseline as provided 

3 in paragraph (4) or (5)— 

4 ‘‘(i) a list of activities to reduce defor5 estation is provided to the Administrator 

6 and made publicly available; 

7 ‘‘(ii) the social and environmental im8 pacts of these activities are monitored and 

9 reported in sufficient detail to allow the Ad10 ministrator to determine compliance with 

11 the requirements of this section; and 

12 ‘‘(iii) the distribution of revenues for 

13 activities to reduce deforestation is trans14 parent, subject to independent third-party 

15 oversight, and publicly disseminated. 

16 ‘‘(2) ELIGIBLE COUNTRIES.—The Administrator, 

17 in consultation with the Secretary of State and the 

18 Administrator of the United States Agency for Inter19 national Development, and in accordance with an 

20 agreement or arrangement described in subsection 

21 (b)(2)(A), shall establish, and periodically review and 

22 update, a list of the developing countries that have the 

23 capacity to participate in deforestation reduction ac24 tivities at a national level, including— 


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1 ‘‘(A) the technical capacity to monitor, 

2 measure, report, and verify forest carbon fluxes 

3 for all significant sources of greenhouse gas emis4 sions from deforestation with an acceptable level 

5 of uncertainty, as determined taking into ac6 count relevant internationally accepted meth7 odologies, such as those established by the Inter8 governmental Panel on Climate Change; 

9 ‘‘(B) the institutional capacity to reduce 

10 emissions from deforestation, including strong 

11 forest governance and mechanisms to ensure 

12 transparency and third-party independent over13 sight of offset activities and revenues, and the 

14 transparent and equitable distribution of offset 

15 revenues for local actions; and 

16 ‘‘(C) a land use or forest sector strategic 

17 plan that— 

18 ‘‘(i) assesses national and local drivers 

19 of deforestation and forest degradation and 

20 identifies reforms to national policies need21 ed to address them; 

22 ‘‘(ii) estimates the country’s emissions 

23 from deforestation and forest degradation; 

24 ‘‘(iii) identifies improvements in and a 

25 timeline for data collection, monitoring, 


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1 and institutional capacity necessary to im2 plement an effective national deforestation 

3 reduction program that meets the criteria 

4 set forth in this section (including a na5 tional deforestation baseline); 

6 ‘‘(iv) establishes a timeline for imple7 menting the program and transitioning for8 est-based economies to low-emissions devel9 opment pathways with respect to emissions 

10 from forest and land use activities; 

11 ‘‘(v) includes a national policy for con12 sultations with, and full participation of, 

13 all stakeholders, especially indigenous and 

14 forest-dependent communities, in its design, 

15 planning, and implementation of activities, 

16 whether at the national or local level, to re17 duce deforestation in the country (including 

18 a national process for addressing grievances 

19 if stakeholders have been caused social, envi20 ronmental, or economic harm); 

21 ‘‘(vi) provides for the distribution of 

22 revenues for activities to reduce deforest23 ation transparently and publicly, subject to 

24 independent third-party oversight; and 


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1 ‘‘(vii) includes a national platform or 

2 a type of registry for information relating 

3 to deforestation and degradation policy and 

4 program implementation processes, includ5 ing a mechanism for the monitoring and re6 porting of the social and environmental im7 pacts of those activities. 

8 ‘‘(3) PROTECTION OF INTERESTS.—With respect 

9 to an agreement or arrangement described in sub10 section (b)(2)(A) with a country that addresses inter11 national offset credits under this subsection, the Ad12 ministrator, in consultation with the Secretary of 

13 State and the Administrator of the United States 

14 Agency for International Development, shall under15 take due diligence to ensure the establishment and en16 forcement by such country of legal regimes, processes, 

17 standards, and safeguards that— 

18 ‘‘(A) give due regard to the rights and in19 terests of local communities, indigenous peoples, 

20 forest-dependent communities, and vulnerable so21 cial groups; 

22 ‘‘(B) promote consultations with, and full 

23 participation of, forest-dependent communities 

24 and indigenous peoples in affected areas, as 

25 partners and primary stakeholders, prior to and 


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1 during the design, planning, implementation, 

2 and monitoring and evaluation of activities; and 

3 ‘‘(C) encourage transparent and equitable 

4 sharing of profits and benefits derived from 

5 international offset credits with local commu6 nities, indigenous peoples, and forest-dependent 

7 communities. 

8 ‘‘(4) NATIONAL DEFORESTATION BASELINE.—A 

9 national deforestation baseline established under this 

10 subsection shall— 

11 ‘‘(A) be national in scope; 

12 ‘‘(B) be consistent with nationally appro13 priate mitigation commitments or actions with 

14 respect to deforestation, taking into consideration 

15 the average annual historical deforestation rates 

16 of the country during a period of at least 5 

17 years, the applicable drivers of deforestation, and 

18 other factors to ensure that only reductions that 

19 are in addition to such commitments or actions 

20 will generate offsets; 

21 ‘‘(C) establish a trajectory that would result 

22 in zero net deforestation by not later than 20 

23 years after the national deforestation baseline 

24 has been established, including a spatially ex25 plicit land use plan that identifies intact and 


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1 primary forest areas and managed forest areas 

2 that are to remain while the country is reaching 

3 the zero net deforestation trajectory; 

4 ‘‘(D) be adjusted over time to take account 

5 of changing national circumstances; 

6 ‘‘(E) be designed to account for all signifi7 cant sources of greenhouse gas emissions from de8 forestation in the country; and 

9 ‘‘(F) be consistent with the national defor10 estation baseline, if any, established for such 

11 country under section 753. 

12 ‘‘(5) STATE-LEVEL OR PROVINCE-LEVEL ACTIVI13 TIES.— 

14 ‘‘(A) ELIGIBLE STATES OR PROVINCES.— 

15 The Administrator, in consultation with the Sec16 retary of State and the Administrator of the 

17 United States Agency for International Develop18 ment, shall establish, and periodically review 

19 and update, a list of states or provinces in devel20 oping countries where— 

21 ‘‘(i) the developing country is not in22 cluded on the list of countries established 

23 pursuant to paragraph (6)(A); 

24 ‘‘(ii) the State or province is under25 taking deforestation reduction activities; 


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1 ‘‘(iii) the state or province has the ca2 pacity to engage in deforestation reduction 

3 activities at the state or province level, in4 cluding— 

5 ‘‘(I) the technical capacity to 

6 monitor and measure forest carbon 

7 fluxes for all significant sources of 

8 greenhouse gas emissions from deforest9 ation with an acceptable amount of 

10 uncertainty, including a spatially ex11 plicit land use plan that identifies in12 tact and primary forest areas and 

13 managed forest areas that are to re14 main while the country is reaching the 

15 zero net deforestation trajectory; and 

16 ‘‘(II) the institutional capacity to 

17 reduce emissions from deforestation, 

18 including strong forest governance and 

19 mechanisms to deliver forest conserva20 tion resources for local actions; 

21 ‘‘(iv) the state or province meets the 

22 eligibility criteria in paragraphs (2) and 

23 (3) for the geographic area under its juris24 diction; and 

25 ‘‘(v) the country— 


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1 ‘‘(I) demonstrates that efforts are 

2 underway to transition to a national 

3 program within 5 years; or 

4 ‘‘(II) in the determination of the 

5 Administrator, is making a good-faith 

6 effort to develop a land use or forest 

7 sector strategic national plan or pro8 gram that meets the criteria described 

9 in paragraph (2)(C). 

10 ‘‘(B) ACTIVITIES.—The Administrator may 

11 issue international offset credits for greenhouse 

12 gas emission reductions achieved through activi13 ties to reduce deforestation at a state or provin14 cial level that meet the requirements of this sec15 tion. Such credits shall be determined by com16 paring the emissions from deforestation within 

17 that state or province relative to the state or 

18 province deforestation baseline for that state or 

19 province established, in accordance with an 

20 agreement or arrangement described in sub21 section (b)(2)(A), pursuant to subparagraph (C) 

22 of this paragraph. 

23 ‘‘(C) STATE-LEVEL OR PROVINCE-LEVEL DE24 FORESTATION BASELINE.—A state-level or prov25 ince-level deforestation baseline shall— 


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1 ‘‘(i) be consistent with any existing na2 tionally appropriate mitigation commit3 ments or actions for the country in which 

4 the activity is occurring, so that only reduc5 tions that are in addition to those commit6 ments or actions will generate offsets; 

7 ‘‘(ii) be developed taking into consider8 ation the average annual historical deforest9 ation rates of the state or province during 

10 a period of at least 5 years, relevant drivers 

11 of deforestation, and other factors to ensure 

12 additionality; 

13 ‘‘(iii) establish a trajectory that would 

14 result in zero net deforestation by not later 

15 than 20 years after the state-level or prov16 ince-level deforestation baseline has been es17 tablished; and 

18 ‘‘(iv) be designed to account for all sig19 nificant sources of greenhouse gas emissions 

20 from deforestation in the state or province 

21 and adjusted to fully account for emissions 

22 leakage outside the state or province through 

23 monitoring of major forested areas in the 

24 host country and other areas of the host 

25 country susceptible to leakage. 


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1 ‘‘(D) PHASE OUT.—Beginning 5 years after 

2 the first calendar year for which a covered entity 

3 must demonstrate compliance with section 

4 722(a), the Administrator shall issue no further 

5 international offset credits for eligible state-level 

6 or province-level activities to reduce deforestation 

7 pursuant to this paragraph. 

8 ‘‘(6) PROJECTS AND PROGRAMS TO REDUCE DE9 FORESTATION.— 

10 ‘‘(A) ELIGIBLE COUNTRIES.—The Adminis11 trator, in consultation with the Secretary of 

12 State and the Administrator of the United States 

13 Agency for International Development, shall es14 tablish, and periodically review and update, a 

15 list of developing countries that— 

16 ‘‘(i) the Administrator determines, 

17 based on recent, credible, and reliable emis18 sions data, account for less than 1 percent 

19 of global greenhouse gas emissions and less 

20 than 3 percent of global forest-sector and 

21 land use change greenhouse gas emissions; 

22 ‘‘(ii) have, or in the determination of 

23 the Administrator are making a good faith 

24 effort to develop, a land use or forest sector 


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1 strategic plan that meets the criteria de2 scribed in paragraph (2)(C); and 

3 ‘‘(iii) has made, or in the determina4 tion of the Administrator, is making, a 

5 good-faith effort to develop, through the im6 plementation of activities under this section, 

7 a monitoring program for major forested 

8 areas in a host country and other areas in 

9 a host country susceptible to leakage, in10 cluding a spatially explicit land use plan 

11 that identifies intact and primary forest 

12 areas and managed forest areas that are to 

13 remain while country is reaching the zero 

14 net deforestation trajectory. 

15 ‘‘(B) ACTIVITIES.—The Administrator may 

16 issue international offset credits for greenhouse 

17 gas emission reductions achieved through project 

18 or program level activities to reduce deforestation 

19 in countries listed under subparagraph (A) that 

20 meet the requirements of this section. The quan21 tity of international offset credits shall be deter22 mined by comparing the project-level or pro23 gram-level emissions from deforestation to a de24 forestation baseline for such project or program 

25 established pursuant to subparagraph (C). 


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1 ‘‘(C) PROJECT-LEVEL OR PROGRAM-LEVEL

2 BASELINE.—A project-level or program-level de3 forestation baseline shall— 

4 ‘‘(i) be consistent with any existing na5 tionally appropriate mitigation commit6 ments or actions for the country in which 

7 the project or program is occurring, so that 

8 only reductions that are in addition to such 

9 commitments or actions will generate off10 sets; 

11 ‘‘(ii) be developed taking into consider12 ation the average annual historical deforest13 ation rates in the project or program 

14 boundary during a period of at least 5 

15 years, applicable drivers of deforestation, 

16 and other factors to ensure additionality; 

17 ‘‘(iii) be designed to account for all sig18 nificant sources of greenhouse gas emissions 

19 from deforestation in the project or program 

20 boundary; and 

21 ‘‘(iv) be adjusted to fully account for 

22 emissions leakage outside the project or pro23 gram boundary, including— 

24 ‘‘(I) estimation through moni25 toring of major forested areas in a host 


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1 country and other areas in a host 

2 country susceptible to leakage, pursu3 ant to section 744(e)(5); and 

4 ‘‘(II) a spatially explicit land use 

5 plan that identifies intact and pri6 mary forest areas and managed forest 

7 areas that are to remain while country 

8 is reaching the zero net deforestation 

9 trajectory 

10 ‘‘(D) PHASE-OUT.— 

11 ‘‘(i) IN GENERAL.—Beginning on the 

12 date that is 8 years after the first calendar 

13 year for which a covered entity must dem14 onstrate compliance with section 722(a), the 

15 Administrator shall issue no further inter16 national offset credits for project-level or 

17 program-level activities as described in this 

18 paragraph, except as provided in clause 

19 (ii). 

20 ‘‘(ii) EXTENSION.—The Administrator 

21 may extend the phase out deadline for the 

22 issuance of international offset credits under 

23 this section by up to 5 years with respect to 

24 eligible activities taking place in a least de25 veloped country, which is a foreign country 


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1 that the United Nations has identified as 

2 among the least developed of developing 

3 countries at the time that the Administrator 

4 determines to provide an extension, pro5 vided that the Administrator, in consulta6 tion with the Secretary of State and the Ad7 ministrator of the United States Agency for 

8 International Development, determines the 

9 country— 

10 ‘‘(I) lacks sufficient capacity to 

11 adopt and implement effective pro12 grams to achieve reductions in deforest13 ation measured against national base14 lines; 

15 ‘‘(II) is receiving support under 

16 part E to develop such capacity; and 

17 ‘‘(III) has developed and is work18 ing to implement a credible national 

19 strategy or plan to reduce deforest20 ation. 

21 ‘‘(7) OFFSET CREDIT ISSUANCE.—Requirements 

22 under this subsection to issue international offset 

23 credits only if the quantity of the international offset 

24 credits is determined by reference to a national, 

25 State-level, or province-level deforestation baseline do 


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1 not preclude the Administrator from issuing a por2 tion of the total quantity of those credits directly to 

3 an offset project developer for use in carrying out ac4 tivities in accordance with this section that contrib5 uted to a reduction in emissions, if that issuance is 

6 authorized by— 

7 ‘‘(A) the agreement or arrangement de8 scribed in subsection (b)(2)(A); and 

9 ‘‘(B) if the credits are issued pursuant to 

10 paragraph (5), by the State or provincial gov11 ernment. 

12 ‘‘(8) EXPANSION OF SCOPE.—In implementing 

13 this subsection, the Administrator, taking into consid14 eration the recommendations of the Advisory Board, 

15 may expand the scope of creditable activities to in16 clude activities that reduce emissions from land use, 

17 such as those that address forest degradation or soil 

18 carbon losses associated with forested wetlands or 

19 peatlands. 

20 ‘‘(f) MODIFICATION OF REQUIREMENTS.—In promul21 gating regulations under subsection (b)(1) with respect to 

22 the issuance of international offset credits under subsection 

23 (c), (d), or (e), the Administrator, in consultation with the 

24 Secretary of State and the Administrator of the United 

25 States Agency for International Development, may modify 


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1 or omit a requirement of this part (excluding the require2 ments of this section) if the Administrator determines that 

3 the application of that requirement to such subsection is 

4 not feasible or would result in the creation of offset credits 

5 that would not be eligible to satisfy emissions reduction 

6 commitments made by the United States pursuant to the 

7 United Nations Framework Convention on Climate Change, 

8 done at New York on May 9, 1992 (or any successor agree9 ment). In modifying or omitting such a requirement on the 

10 basis of infeasibility, the Administrator, in consultation 

11 with the Secretary of State and the Administrator of the 

12 United States Agency for International Development, shall 

13 ensure, with an adequate margin of safety, the integrity of 

14 international offset credits issued under this section and of 

15 the greenhouse gas emissions limitations established pursu16 ant to section 703. 

17 ‘‘(g) AVOIDING DOUBLE COUNTING.—The Adminis18 trator, in consultation with the Secretary of State, shall 

19 seek, by whatever means appropriate, including agreements, 

20 arrangements, or technical cooperation, to ensure that ac21 tivities on the basis of which international offset credits are 

22 issued under this section are not used for compliance with 

23 an obligation to reduce or avoid greenhouse gas emissions, 

24 or increase greenhouse gas sequestration, under a foreign 

25 or international regulatory system. In addition, no interVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01423 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 national offset credits shall be issued for emission reductions 

2 from activities with respect to which emission allowances 

3 were allocated under section 771(c) for distribution under 

4 part E. 

5 ‘‘(h) LIMITATION.—The Administrator shall not issue 

6 international offset credits generated by projects based on 

7 the destruction of hydrofluorocarbons.’’. 

8 SEC. 102. DEFINITIONS. 

9 Title VII of the Clean Air Act (as added by section 

10 101 of this division) is amended by inserting before part 

11 A the following: 

12 ‘‘SEC. 700. DEFINITIONS. 

13 ‘‘In this title: 

14 ‘‘(1) ADDITIONAL.—The term ‘additional’, when 

15 used with respect to reductions or avoidance of green16 house gas emissions, or to sequestration of greenhouse 

17 gases, means reductions, avoidance, or sequestration 

18 that result in a lower level of net greenhouse gas emis19 sions or atmospheric concentrations than would occur 

20 in the absence of an offset credit. 

21 ‘‘(2) ADDITIONALITY.—The term ‘additionality’ 

22 means the extent to which reductions or avoidance of 

23 greenhouse gas emissions, or sequestration of green24 house gases, are additional. 


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1 ‘‘(3) ADVISORY BOARD.—The term ‘Advisory 

2 Board’ means the Offsets Integrity Advisory Board es3 tablished under section 731. 

4 ‘‘(4) AFFILIATED.—The term ‘affiliated’— 

5 ‘‘(A) when used in relation to an entity, 

6 means owned or controlled by, or under common 

7 ownership or control with, another entity, as de8 termined by the Administrator; and 

9 ‘‘(B) when used in relation to a natural gas 

10 local distribution company, means owned or con11 trolled by, or under common ownership or con12 trol with, another natural gas local distribution 

13 company, as determined by the Administrator. 

14 ‘‘(5) ALLOWANCE.—The term ‘allowance’ means 

15 a limited authorization to emit, or have attributable 

16 greenhouse gas emissions in an amount of, 1 ton of 

17 carbon dioxide equivalent of a greenhouse gas in ac18 cordance with this title; it includes an emission al19 lowance, a compensatory allowance, or an inter20 national emission allowance. 

21 ‘‘(6) ATTRIBUTABLE GREENHOUSE GAS EMIS22 SIONS.—The term ‘attributable greenhouse gas emis23 sions’ means— 

24 ‘‘(A) for a covered entity that is a fuel pro25 ducer or importer described in paragraph 


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1 (13)(B), greenhouse gases that would be emitted 

2 from the combustion of any petroleum-based or 

3 coal-based liquid fuel, petroleum coke, or natural 

4 gas liquid, produced or imported by that covered 

5 entity for sale or distribution in interstate com6 merce, assuming no capture and sequestration of 

7 any greenhouse gas emissions; 

8 ‘‘(B) for a covered entity that is an indus9 trial gas producer or importer described in para10 graph (13)(C), the tons of carbon dioxide equiva11 lent of fossil fuel-based carbon dioxide, nitrous 

12 oxide, any fluorinated gas, other than nitrogen 

13 trifluoride, that is a greenhouse gas, or any com14 bination thereof— 

15 ‘‘(i) produced or imported by such cov16 ered entity during the previous calendar 

17 year for sale or distribution in interstate 

18 commerce; or 

19 ‘‘(ii) released as fugitive emissions in 

20 the production of fluorinated gas; and 

21 ‘‘(C) for a natural gas local distribution 

22 company described in paragraph (13)(J), green23 house gases that would be emitted from the com24 bustion of the natural gas, and any other gas 

25 meeting the specifications for commingling with 


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1 natural gas for purposes of delivery, that such 

2 entity delivered during the previous calendar 

3 year to customers that are not covered entities, 

4 assuming no capture and sequestration of that 

5 greenhouse gas. 

6 ‘‘(7) BIOLOGICAL SEQUESTRATION; BIO7 LOGICALLY SEQUESTERED.—The terms ‘biological se8 questration’ and ‘biologically sequestered’ mean the 

9 removal of greenhouse gases from the atmosphere by 

10 terrestrial biological means, such as by growing 

11 plants, and the storage of those greenhouse gases in 

12 plants or soils. 

13 ‘‘(8) CAPPED EMISSIONS.—The term ‘capped 

14 emissions’ means greenhouse gas emissions to which 

15 section 722 applies, including emissions from the 

16 combustion of natural gas, petroleum-based or coal17 based liquid fuel, petroleum coke, or natural gas liq18 uid to which section 722(b)(2) or (8) applies. 

19 ‘‘(9) CAPPED SOURCE.—The term ‘capped source’ 

20 means a source that directly emits capped emissions. 

21 ‘‘(10) CARBON DIOXIDE EQUIVALENT.—The term 

22 ‘carbon dioxide equivalent’ means the unit of meas23 ure, expressed in metric tons, of greenhouse gases as 

24 provided under section 711 or 712. 


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1 ‘‘(11) CARBON STOCK.—The term ‘carbon stock’ 

2 means the quantity of carbon contained in a biologi3 cal reservoir or system which has the capacity to ac4 cumulate or release carbon. 

5 ‘‘(12) COMPENSATORY ALLOWANCE.—The term 

6 ‘compensatory allowance’ means an allowance issued 

7 under section 721(f). 

8 ‘‘(13) COVERED ENTITY.—The term ‘covered enti9 ty’ means each of the following: 

10 ‘‘(A) Any electricity source. 

11 ‘‘(B)(i) Any stationary source that produces 

12 petroleum-based or coal-based liquid fuel, petro13 leum coke, or natural gas liquid, the combustion 

14 of which would emit 25,000 or more tons of car15 bon dioxide equivalent, as determined by the Ad16 ministrator. 

17 ‘‘(ii) Any entity that (or any group of 2 or 

18 more affiliated entities that, in the aggregate) 

19 imports petroleum-based or coal-based liquid 

20 fuel, petroleum coke, or natural gas liquid, the 

21 combustion of which would emit 25,000 or more 

22 tons of carbon dioxide equivalent, as determined 

23 by the Administrator. 

24 ‘‘(C) Any stationary source that produces, 

25 and any entity that (or any group of two or 


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1 more affiliated entities that, in the aggregate) 

2 imports, for sale or distribution in interstate 

3 commerce, in bulk, or in products designated by 

4 the Administrator, in 2008 or any subsequent 

5 year more than 25,000 tons of carbon dioxide 

6 equivalent of— 

7 ‘‘(i) fossil fuel-based carbon dioxide; 

8 ‘‘(ii) nitrous oxide; 

9 ‘‘(iii) perfluorocarbons; 

10 ‘‘(iv) sulfur hexafluoride; 

11 ‘‘(v) any other fluorinated gas, except 

12 for nitrogen trifluoride, that is a greenhouse 

13 gas, as designated by the Administrator 

14 under section 711(b) or (c); or 

15 ‘‘(vi) any combination of greenhouse 

16 gases described in clauses (i) through (v). 

17 ‘‘(D) Any stationary source that has emit18 ted 25,000 or more tons of carbon dioxide equiv19 alent of nitrogen trifluoride in 2008 or any sub20 sequent year. 

21 ‘‘(E) Any geologic sequestration site. 

22 ‘‘(F) Any stationary source in the following 

23 industrial sectors: 

24 ‘‘(i) Adipic acid production. 

25 ‘‘(ii) Primary aluminum production. 


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1 ‘‘(iii) Ammonia manufacturing. 

2 ‘‘(iv) Cement production, excluding 

3 grinding-only operations. 

4 ‘‘(v) Hydrochlorofluorocarbon produc5 tion. 

6 ‘‘(vi) Lime manufacturing. 

7 ‘‘(vii) Nitric acid production. 

8 ‘‘(viii) Petroleum refining. 

9 ‘‘(ix) Phosphoric acid production. 

10 ‘‘(x) Silicon carbide production. 

11 ‘‘(xi) Soda ash production. 

12 ‘‘(xii) Titanium dioxide production. 

13 ‘‘(xiii) Coal-based liquid or gaseous 

14 fuel production. 

15 ‘‘(G) Any stationary source in the chemical 

16 or petrochemical sector that, in 2008 or any sub17 sequent year— 

18 ‘‘(i) produces acrylonitrile, carbon 

19 black, ethylene, ethylene dichloride, ethylene 

20 oxide, or methanol; or 

21 ‘‘(ii) produces a chemical or petro22 chemical product if producing that product 

23 results in annual combustion plus process 

24 emissions of 25,000 or more tons of carbon 

25 dioxide equivalent. 


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1 ‘‘(H) Any stationary source that— 

2 ‘‘(i) is in one of the following indus3 trial sectors: ethanol production; ferroalloy 

4 production; fluorinated gas production; food 

5 processing; glass production; hydrogen pro6 duction; beneficiation or other processing 

7 (including agglomeration) of metal ores; 

8 iron and steel production; lead production; 

9 pulp and paper manufacturing; and zinc 

10 production; and 

11 ‘‘(ii) has emitted 25,000 or more tons 

12 of carbon dioxide equivalent in 2008 or any 

13 subsequent year. 

14 ‘‘(I) Any fossil fuel-fired combustion device 

15 (such as a boiler) or grouping of such devices 

16 that— 

17 ‘‘(i) is all or part of an industrial 

18 source not specified in subparagraph (D), 

19 (F), (G), or (H); and 

20 ‘‘(ii) has emitted 25,000 or more tons 

21 of carbon dioxide equivalent in 2008 or any 

22 subsequent year. 

23 ‘‘(J) Any natural gas local distribution 

24 company that (or any group of 2 or more affili25 ated natural gas local distribution companies 


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1 that, in the aggregate) in 2008 or any subsequent 

2 year, delivers 460,000,000 cubic feet or more of 

3 natural gas to customers that are not covered en4 tities. 

5 ‘‘(14) CREDITING PERIOD.—The term ‘crediting 

6 period’ means the period with respect to which an off7 set project is eligible to earn offset credits under part 

8 D, as determined under section 734(c). 

9 ‘‘(15) DESIGNATED REPRESENTATIVE.—The term 

10 ‘designated representative’ means, with respect to a 

11 covered entity, a reporting entity, an offset project de12 veloper, or any other entity receiving or holding al13 lowances or offset credits under this title, an indi14 vidual authorized, through a certificate of representa15 tion submitted to the Administrator by the owners 

16 and operators or similar entity official, to represent 

17 the owners and operators or similar entity official in 

18 all matters pertaining to this title (including the 

19 holding, transfer, or disposition of allowances or offset 

20 credits), and to make all submissions to the Adminis21 trator under this title. 

22 ‘‘(16) DEVELOPING COUNTRY.—The term ‘devel23 oping country’ means a country eligible to receive of24 ficial development assistance according to the income 

25 guidelines of the Development Assistance Committee 


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1 of the Organization for Economic Cooperation and 

2 Development. 

3 ‘‘(17) DOMESTIC OFFSET CREDIT.— 

4 ‘‘(A) IN GENERAL.—The term ‘domestic off5 set credit’ means an offset credit issued under 

6 part D, other than an international offset credit. 

7 ‘‘(B) EXCLUSION.—The term ‘domestic off8 set credit’ does not include a term offset credit. 

9 ‘‘(18) ELECTRICITY SOURCE.—The term ‘elec10 tricity source’ means a stationary source that in11 cludes one or more utility units. 

12 ‘‘(19) EMISSION.—The term ‘emission’ means the 

13 release of a greenhouse gas into the ambient air. Such 

14 term does not include gases that are captured and se15 questered, except to the extent that they are later re16 leased into the atmosphere, in which case compliance 

17 must be demonstrated pursuant to section 722(b)(5). 

18 ‘‘(20) EMISSION ALLOWANCE.—The term ‘emis19 sion allowance’ means an allowance established under 

20 section 721(a) or 726(g)(2). 

21 ‘‘(21) FAIR MARKET VALUE.—The term ‘fair 

22 market value’ means the average daily closing price 

23 on registered exchanges or, if such a price is unavail24 able, the average price as determined by the AdminisVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01433 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 trator, during a specified time period, of an emission 

2 allowance. 

3 ‘‘(22) FEDERAL LAND.—The term ‘Federal land’ 

4 means land that is owned by the United States, other 

5 than land held in trust for an Indian or Indian tribe. 

6 ‘‘(23) FOSSIL FUEL.—The term ‘fossil fuel’ 

7 means natural gas, petroleum, or coal, or any form 

8 of solid, liquid, or gaseous fuel derived from such ma9 terial, including consumer products that are derived 

10 from such materials and are combusted. 

11 ‘‘(24) FOSSIL FUEL-FIRED.—The term ‘fossil 

12 fuel-fired’ means powered by combustion of fossil fuel, 

13 alone or in combination with any other fuel, regard14 less of the percentage of fossil fuel consumed. 

15 ‘‘(25) FUGITIVE EMISSIONS.—The term ‘fugitive 

16 emissions’ means emissions from leaks, valves, joints, 

17 or other small openings in pipes, ducts, or other 

18 equipment, or from vents. 

19 ‘‘(26) GEOLOGIC SEQUESTRATION; GEOLOGI20 CALLY SEQUESTERED.—The terms ‘geologic sequestra21 tion’ and ‘geologically sequestered’ mean the seques22 tration of greenhouse gases in subsurface geologic for23 mations for purposes of permanent storage. 


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1 ‘‘(27) GEOLOGIC SEQUESTRATION SITE.—The 

2 term ‘geologic sequestration site’ means a site where 

3 carbon dioxide is geologically sequestered. 

4 ‘‘(28) GREENHOUSE GAS.—The term ‘greenhouse 

5 gas’ means any gas described in section 711(a) or des6 ignated under section 711(b), (c), or (e), except to the 

7 extent that it is regulated under title VI. 

8 ‘‘(29) HIGH CONSERVATION PRIORITY LAND.— 

9 The term ‘high conservation priority land’ means 

10 land that is not Federal land and is— 

11 ‘‘(A) globally or State ranked as critically 

12 imperiled or imperiled under a State Natural 

13 Heritage Program; or 

14 ‘‘(B) old-growth or late-successional forest, 

15 as identified by the office of the State Forester or 

16 relevant State agency with regulatory jurisdic17 tion over forestry activities. 

18 ‘‘(30) HOLD.—The term ‘hold’ means, with re19 spect to an allowance, offset credit, or term offset 

20 credit, to have in the appropriate account in the al21 lowance tracking system, or submit to the Adminis22 trator for recording in such account. 

23 ‘‘(31) INDUSTRIAL SOURCE.—The term ‘indus24 trial source’ means any stationary source that— 

25 ‘‘(A) is not an electricity source; and 


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1 ‘‘(B) is in— 

2 ‘‘(i) the manufacturing sector (as de3 fined in North American Industrial Classi4 fication System codes 31, 32, and 33); or 

5 ‘‘(ii) the natural gas processing or nat6 ural gas pipeline transportation sector (as 

7 defined in North American Industrial Clas8 sification System codes 211112 or 486210). 

9 ‘‘(32) INTERNATIONAL EMISSION ALLOWANCE.— 

10 The term ‘international emission allowance’ means a 

11 tradable authorization to emit 1 ton of carbon dioxide 

12 equivalent of greenhouse gas that is issued by a na13 tional or supranational foreign government pursuant 

14 to a qualifying international program designated by 

15 the Administrator pursuant to section 728(a). 

16 ‘‘(33) INTERNATIONAL OFFSET CREDIT.—The 

17 term ‘international offset credit’ means an offset cred18 it issued by the Administrator under section 744. 

19 ‘‘(34) LEAKAGE.—The term ‘leakage’ means a 

20 significant increase in greenhouse gas emissions, or 

21 significant decrease in sequestration, which is caused 

22 by an offset project and occurs outside the boundaries 

23 of the offset project. 

24 ‘‘(35) MARKET STABILITY RESERVE ALLOW25 ANCE.—The term ‘market stability reserve allowance’ 


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1 means an emission allowance reserved for, transferred 

2 to, or deposited in the market stability reserve, or es3 tablished, under section 726. 

4 ‘‘(36) MINERAL SEQUESTRATION.—The term 

5 ‘mineral sequestration’ means sequestration of carbon 

6 dioxide from the atmosphere by capturing carbon di7 oxide into a permanent mineral, such as the aqueous 

8 precipitation of carbonate minerals that results in the 

9 storage of carbon dioxide in a mineral form. 

10 ‘‘(37) NATURAL GAS LIQUID.—The term ‘natural 

11 gas liquid’ means ethane, butane, isobutane, natural 

12 gasoline, and propane which is ready for commercial 

13 sale or use. 

14 ‘‘(38) NATURAL GAS LOCAL DISTRIBUTION COM15 PANY.—The term ‘natural gas local distribution com16 pany’ has the meaning given the term ‘local distribu17 tion company’ in section 2(17) of the Natural Gas 

18 Policy Act of 1978 (15 U.S.C. 3301(17)). 

19 ‘‘(39) OFFSET CREDIT.— 

20 ‘‘(A) IN GENERAL.—The term ‘offset credit’ 

21 means an offset credit issued under part D. 

22 ‘‘(B) EXCLUSION.—The term ‘offset credit’ 

23 does not include a term offset credit. 

24 ‘‘(40) OFFSET PROJECT.—The term ‘offset 

25 project’ means a project or activity that reduces or 


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1 avoids greenhouse gas emissions, or sequesters green2 house gases, and for which offset credits are or may 

3 be issued under part D. 

4 ‘‘(41) OFFSET PROJECT DEVELOPER.—The term 

5 ‘offset project developer’ means the individual or enti6 ty designated as the offset project developer in an off7 set project approval petition under section 735(c)(1). 

8 ‘‘(42) QUALIFIED R&D FACILITY.—The term 

9 ‘qualified R&D facility’ means a facility that con10 ducts research and development, that was in oper11 ation as of the date of enactment of this title, and 

12 that is part of a covered entity subject to paragraphs 

13 (1) through (8) of section 722(b). 

14 ‘‘(43) PETROLEUM.—The term ‘petroleum’ in15 cludes crude oil, tar sands, oil shale, and heavy oils. 

16 ‘‘(44) REPEATED INTENTIONAL REVERSALS.— 

17 The term ‘repeated intentional reversals’ means at 

18 least 3 intentional reversals, as determined by the Ad19 ministrator or a court under section 734(b)(3)(B)(ii). 

20 ‘‘(45) RESEARCH AND DEVELOPMENT.—The term 

21 ‘research and development’ means activities— 

22 ‘‘(A) that are conducted in process units or 

23 at laboratory bench-scale settings; 

24 ‘‘(B) whose purpose is to conduct research 

25 and development for new processes, technologies, 


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1 or products that contribute to lower greenhouse 

2 gas emissions; and 

3 ‘‘(C) that do not manufacture products for 

4 sale. 

5 ‘‘(46) RENEWABLE BIOMASS.—The term ‘renew6 able biomass’ means any of the following: 

7 ‘‘(A) Plant material, including waste mate8 rial, harvested or collected from actively man9 aged agricultural land that was in cultivation, 

10 cleared, or fallow and nonforested on January 1, 

11 2009. 

12 ‘‘(B) Plant material, including waste mate13 rial, harvested or collected from pastureland that 

14 was nonforested on January 1, 2009. 

15 ‘‘(C) Nonhazardous vegetative matter de16 rived from waste, including separated yard 

17 waste, landscape right-of-way trimmings, con18 struction and demolition debris, or food waste 

19 (but not municipal solid waste, recyclable waste 

20 paper, painted, treated or pressurized wood, or 

21 wood contaminated with plastic or metals). 

22 ‘‘(D) Animal waste or animal byproducts, 

23 including products of animal waste digesters. 

24 ‘‘(E) Algae. 


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1 ‘‘(F) Trees, brush, slash, residues, or any 

2 other vegetative matter removed from within 600 

3 feet of any building, campground, or route des4 ignated for evacuation by a public official with 

5 responsibility for emergency preparedness, or 

6 from within 300 feet of a paved road, electric 

7 transmission line, utility tower, or water supply 

8 line. 

9 ‘‘(G) Residues from or byproducts of milled 

10 logs. 

11 ‘‘(H) Any of the following removed from for12 ested land that is not Federal and is not high 

13 conservation priority land: 

14 ‘‘(i) Trees, brush, slash, residues, inter15 planted energy crops, or any other vegeta16 tive matter removed from an actively man17 aged tree plantation established— 

18 ‘‘(I) prior to January 1, 2009; or 

19 ‘‘(II) on land that, as of January 

20 1, 2009, was cultivated or fallow and 

21 non-forested. 

22 ‘‘(ii) Trees, logging residue, thinnings, 

23 cull trees, pulpwood, and brush removed 

24 from naturally regenerated forests or other 

25 non-plantation forests, including for the 


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1 purposes of hazardous fuel reduction or pre2 ventative treatment for reducing or con3 taining insect or disease infestation. 

4 ‘‘(iii) Logging residue, thinnings, cull 

5 trees, pulpwood, brush, and species that are 

6 non-native and noxious, from stands that 

7 were planted and managed after January 1, 

8 2009, to restore or maintain native forest 

9 types. 

10 ‘‘(iv) Dead or severely damaged trees 

11 removed within 5 years of fire, blowdown, 

12 or other natural disaster, and badly infested 

13 trees. 

14 ‘‘(I) Materials, pre-commercial thinnings, 

15 or removed invasive species from National Forest 

16 System land and public lands (as defined in sec17 tion 103 of the Federal Land Policy and Man18 agement Act of 1976 (43 U.S.C. 1702)), includ19 ing those that are byproducts of preventive treat20 ments (such as trees, wood, brush, thinnings, 

21 chips, and slash), that are removed as part of a 

22 federally recognized timber sale, or that are re23 moved to reduce hazardous fuels, to reduce or 

24 contain disease or insect infestation, or to restore 

25 ecosystem health, and that are— 


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1 ‘‘(i) not from components of the Na2 tional Wilderness Preservation System, Wil3 derness Study Areas, Inventoried Roadless 

4 Areas, old growth or mature forest stands, 

5 components of the National Landscape Con6 servation System, National Monuments, Na7 tional Conservation Areas, Designated 

8 Primitive Areas; or Wild and Scenic Rivers 

9 corridors; 

10 ‘‘(ii) harvested in environmentally sus11 tainable quantities, as determined by the 

12 appropriate Federal land manager; and 

13 ‘‘(iii) are harvested in accordance with 

14 Federal and State law, and applicable land 

15 management plans. 

16 ‘‘(47) RETIRE.—The term ‘retire’, with respect to 

17 an allowance, offset credit, or term offset credit estab18 lished or issued under this title, means to disqualify 

19 such allowance or offset credit for any subsequent use 

20 under this title, regardless of whether the use is a sale, 

21 exchange, or submission of the allowance, offset credit, 

22 or term offset credit to satisfy a compliance obliga23 tion. 


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1 ‘‘(48) REVERSAL.—The term ‘reversal’ means an 

2 intentional or unintentional loss of sequestered green3 house gases to the atmosphere. 

4 ‘‘(49) SEQUESTERED AND SEQUESTRATION.—The 

5 terms ‘sequestered’ and ‘sequestration’ mean the sepa6 ration, isolation, or removal of greenhouse gases from 

7 the atmosphere, as determined by the Administrator. 

8 The terms include biological, geologic, and mineral se9 questration, but do not include ocean fertilization 

10 techniques. 

11 ‘‘(50) SMALL BUSINESS REFINER.— 

12 ‘‘(A) IN GENERAL.—The term ‘small busi13 ness refiner’ means a refiner that meets the ap14 plicable Federal refinery capacity and employee 

15 limitations criteria described in section 

16 45H(c)(1) of the Internal Revenue Code of 1986 

17 (as in effect on the date of enactment of this sec18 tion and without regard to section 45H(d)). 

19 ‘‘(B) ELIGIBILITY.—Eligibility of a small 

20 business refiner under this paragraph shall not 

21 be recalculated or disallowed on account of— 

22 ‘‘(i) a merger of the small business re23 finer with 1 or more other small business 

24 refiners after December 31, 2002; or 


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1 ‘‘(ii) the acquisition by a small busi2 ness refiner of another small business re3 finer (or refinery of such refiner) after De4 cember 31, 2002. 

5 ‘‘(51) STATIONARY SOURCE.—The term ‘sta6 tionary source’ means any integrated operation com7 prising any plant, building, structure, or stationary 

8 equipment, including support buildings and equip9 ment, that is located within one or more contiguous 

10 or adjacent properties, is under common control of the 

11 same person or persons, and emits or may emit a 

12 greenhouse gas. 

13 ‘‘(52) TON.—The term ‘ton’ means a metric ton. 

14 ‘‘(53) UNCAPPED EMISSIONS.—The term ‘un15 capped emissions’ means emissions of greenhouse 

16 gases emitted after December 31, 2011, that are not 

17 capped emissions. 

18 ‘‘(54) UNITED STATES GREENHOUSE GAS EMIS19 SIONS.—The term ‘United States greenhouse gas emis20 sions’ means the total quantity of annual greenhouse 

21 gas emissions from the United States, as calculated by 

22 the Administrator and reported to the United Nations 

23 Framework Convention on Climate Change Secre24 tariat. 


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1 ‘‘(55) UTILITY UNIT.—The term ‘utility unit’ 

2 means a combustion device that, on January 1, 2009, 

3 or any date thereafter, is fossil fuel-fired and serves 

4 a generator that produces electricity for sale, unless 

5 such combustion device, during the 12-month period 

6 starting the later of January 1, 2009, or the com7 mencement of commercial operation and each cal8 endar year starting after such later date— 

9 ‘‘(A) is part of an integrated cycle system 

10 that cogenerates thermal energy and electricity 

during normal operation and that supplies 1 11 ⁄3 or 

12 less of its potential electric output capacity and 

13 25 megawatts or less of electrical output for sale; 

14 or 

15 ‘‘(B) combusts materials of which more than 

16 95 percent is municipal solid waste on a heat 

17 input basis. 

18 ‘‘(56) VINTAGE YEAR.—The term ‘vintage year’ 

19 means the calendar year for which an emission allow20 ance is established under section 721(a) or which is 

21 assigned to an emission allowance under section 

22 726(g)(3)(A), except that the vintage year for a mar23 ket stability reserve allowance shall be the year in 

24 which such allowance is purchased at auction.’’. 


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1 SEC. 103. OFFSET REPORTING REQUIREMENTS. 

2 Section 114 of Clean Air Act (42 U.S.C. 7414) is 

3 amended by adding at the end the following: 

4 ‘‘(e) RECORDKEEPING FOR CARBON OFFSETS PRO5 GRAM.—For the purpose of implementing the carbon offsets 

6 program set forth in subtitle D of title VII, the Adminis7 trator shall require any person who is an offset project de8 veloper, and may require any person who is a third party 

9 verifier, to establish and maintain records, for a period of 

10 not less than the crediting period under section 734(c) plus 

11 5 years, relating to— 

12 ‘‘(1) any offset project approval petition sub13 mitted to the appropriate officials under section 735; 

14 ‘‘(2) any reversals which occur with respect to an 

15 offset project; 

16 ‘‘(3) any verification reports; and 

17 ‘‘(4) any other aspect of the offset project that the 

18 appropriate officials determines is appropriate.’’. 

19 Subtitle B—Disposition of 

20 Allowances 

21 SEC. 111. DISPOSITION OF ALLOWANCES FOR GLOBAL 

22 WARMING POLLUTION REDUCTION PROGRAM. 

23 Title VII of the Clean Air Act (as amended by section 

24 141 of this division) is amended by adding at the end the 

25 following: 


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1 ‘‘PART G—DISPOSITION OF ALLOWANCES 

2 ‘‘SEC. 771. ALLOCATION OF EMISSION ALLOWANCES. 

3 ‘‘(a) ALLOCATION.—Subject to subsection (d), of the 

4 total quantity of emission allowances established for each 

5 vintage year under section 721(a), the Administrator shall 

6 allocate emission allowances for the purposes and for the 

7 vintage years and corresponding percentages specified as 

8 follows: 

9 ‘‘(1) For the program for electricity consumers 

10 pursuant to section 772, as described in the following 

11 tables: 

12 ‘‘(A) For distribution to electricity con13 sumers in accordance with subsections (b), (c), 

14 and (d) of section 772, the percentages specified 

15 in the following table: 

‘‘Electricity consumers 

Vintage Year Percentage of 

allowances 

2012 ............................................................................. 43.75 

2013 ............................................................................. 43.75 

2014 ............................................................................. 38.89 

2015 ............................................................................. 38.89 

2016 ............................................................................. 35.00 

2017 ............................................................................. 35.00 

2018 ............................................................................. 35.00 

2019 ............................................................................. 35.00 

2020 ............................................................................. 35.00 

2021 ............................................................................. 35.00 

2022 ............................................................................. 35.00 

2023 ............................................................................. 35.00 

2024 ............................................................................. 35.00 

2025 ............................................................................. 35.00 

2026 ............................................................................. 28.00 

2027 ............................................................................. 21.00 

2028 ............................................................................. 14.00 

2029 ............................................................................. 7.00 


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1 ‘‘(B) For distribution to small LDCs under 

2 section 772(e), the percentages specified in the 

3 following table: 

‘‘Small LDCs 

Vintage Year Percentage of 

allowances 

2012 ............................................................................. 0.50 

2013 ............................................................................. 0.50 

2014 ............................................................................. 0.50 

2015 ............................................................................. 0.50 

2016 ............................................................................. 0.50 

2017 ............................................................................. 0.50 

2018 ............................................................................. 0.50 

2019 ............................................................................. 0.50 

2020 ............................................................................. 0.50 

2021 ............................................................................. 0.50 

2022 ............................................................................. 0.50 

2023 ............................................................................. 0.50 

2024 ............................................................................. 0.50 

2025 ............................................................................. 0.50 

2026 ............................................................................. 0.40 

2027 ............................................................................. 0.30 

2028 ............................................................................. 0.20 

2029 ............................................................................. 0.10 

4 ‘‘(2) For the program for natural gas consumers 

5 pursuant to section 773, as described in the following 

6 table: 

‘‘Natural gas consumers 

Vintage Year Percentage of 

allowances 

2012 ............................................................................. 0.00 

2013 ............................................................................. 0.00 

2014 ............................................................................. 0.00 

2015 ............................................................................. 0.00 

2016 ............................................................................. 9.00 

2017 ............................................................................. 9.00 

2018 ............................................................................. 9.00 

2019 ............................................................................. 9.00 

2020 ............................................................................. 9.00 

2021 ............................................................................. 9.00 

2022 ............................................................................. 9.00 

2023 ............................................................................. 9.00 

2024 ............................................................................. 9.00 

2025 ............................................................................. 9.00 

2026 ............................................................................. 7.20 

2027 ............................................................................. 5.40 

2028 ............................................................................. 3.60 


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‘‘Natural gas consumers—Continued 

2029 ............................................................................. 1.80 

1 ‘‘(3) For the program for home heating oil and 

2 propane consumers pursuant to section 774, as de3 scribed in the following table: 

‘‘Home heating oil and propane consumers 

Vintage Year Percentage of 

allowances 

2012 ............................................................................. 1.88 

2013 ............................................................................. 1.88 

2014 ............................................................................. 1.67 

2015 ............................................................................. 1.67 

2016 ............................................................................. 1.50 

2017 ............................................................................. 1.50 

2018 ............................................................................. 1.50 

2019 ............................................................................. 1.50 

2020 ............................................................................. 1.50 

2021 ............................................................................. 1.50 

2022 ............................................................................. 1.50 

2023 ............................................................................. 1.50 

2024 ............................................................................. 1.50 

2025 ............................................................................. 1.50 

2026 ............................................................................. 1.20 

2027 ............................................................................. 0.90 

2028 ............................................................................. 0.60 

2029 ............................................................................. 0.30 

4 ‘‘(4) For the program for domestic fuel produc5 tion, including petroleum refiners and small business 

6 refiners, under section 775, for each of vintage years 

7 2014 through 2026, for allocation and distribution in 

8 accordance with section 775— 

9 ‘‘(A) 1.25 percent of the emission allowances 

10 established for each vintage year under section 

11 721(a) to domestic petroleum refineries that are 

12 covered entities described in section 

13 700(13)(F)(viii); and 


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1 ‘‘(B) an additional 1.0 percent of the emis2 sion allowances established for each vintage year 

3 under section 721(a) to small business refiners 

4 that are covered entities described in section 

5 700(13)(F)(viii). 

6 ‘‘(5) In addition to emission allowances reserved 

7 under subsection (d)(5), subject to subparagraph (G), 

8 for the program to ensure real reductions in indus9 trial emissions under part F, as follows: 

10 ‘‘(A) For each of vintage years 2012 and 

11 2013, up to 4.0 percent of the emission allow12 ances established for each year under section 

13 721(a). 

14 ‘‘(B) For vintage year 2014, up to 15 per15 cent of the emission allowances established for 

16 that year under section 721(a). 

17 ‘‘(C) For vintage year 2015, up to the prod18 uct of— 

19 ‘‘(i) the quantity specified in subpara20 graph (B); multiplied by 

21 ‘‘(ii) the quantity of emission allow22 ances established for 2015 under section 

23 721(a) divided by the quantity of emission 

24 allowances established for 2014 under sec25 tion 721(a). 


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1 ‘‘(D) For vintage year 2016, up to the lesser 

2 or 13.45 percent or the product obtained by mul3 tiplying— 

4 ‘‘(i) the quantity specified in subpara5 graph (C); and 

6 ‘‘(ii) the quantity of emission allow7 ances established for 2015 under section 

8 721(a) divided by the quantity of emission 

9 allowances established for 2014 under sec10 tion 721(a). 

11 ‘‘(E) For vintage years 2017 through 2025, 

12 up to the lesser or 13.45 percent or the product 

13 obtained by multiplying— 

14 ‘‘(i) the quantity specified in subpara15 graph (D); and 

16 ‘‘(ii) the quantity of emission allow17 ances established for that year under section 

18 721(a) divided by the quantity of emission 

19 allowances established for 2016 under sec20 tion 721(a). 

21 ‘‘(F) For vintage years 2026 through 2050, 

22 up to the product of the quantity specified in 

23 subparagraph (D)— 

24 ‘‘(i) multiplied by the quantity of 

25 emission allowances established for the apVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01451 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 plicable year during 2026 through 2050 

2 under section 721(a) divided by the quan3 tity of emission allowances established for 

4 2016 under section 721(a); and 

5 ‘‘(ii) multiplied by a factor that shall 

6 equal 90 percent for 2026 and decline 10 

7 percent for each year thereafter until reach8 ing 0. 

9 ‘‘(G) If the Administrator has not distrib10 uted all of the allowances allocated pursuant to 

11 this paragraph for a given vintage year by the 

12 end of that year, any emission allowances allo13 cated to entities in eligible industrial sectors 

14 pursuant to this paragraph that have not been so 

15 distributed shall, in accordance with subsection 

16 (e), be exchanged for allowances from the fol17 lowing vintage year and treated as part of the 

18 allocation to such entities for that later vintage 

19 year. 

20 ‘‘(6)(A) Subject to subparagraph (B), for the 

21 program for commercial deployment of carbon cap22 ture and sequestration technologies under section 780, 

23 as described in the following table: 

‘‘Deployment of carbon capture and sequestration technology 

Vintage Year Percentage of 

allowances 

2012 ............................................................................. 0.00 

2013 ............................................................................. 0.00 


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‘‘Deployment of carbon capture and sequestration technology— 

Continued 

2014 ............................................................................. 1.75 

2015 ............................................................................. 1.75 

2016 ............................................................................. 1.75 

2017 ............................................................................. 1.75 

2018 ............................................................................. 4.75 

2019 ............................................................................. 4.75 

Each of vintage years 2020 through 2050 ................ 5.00 

1 ‘‘(B) If the Administrator has not distributed all 

2 of the allowances allocated pursuant to this para3 graph for a given vintage year by the end of that 

4 year, all such undistributed emission allowances shall, 

5 in accordance with subsection (e), be exchanged for al6 lowances from the following vintage year and treated 

7 as part of the allocation for the deployment of carbon 

8 capture and sequestration technology under this sub9 section for that later vintage year. 

10 ‘‘(7) For the program for early action recogni11 tion pursuant to section 782, 2.0 percent of the emis12 sion allowances for each of vintage years 2012 and 

13 2013. 

14 ‘‘(8) For the program for investment in clean ve15 hicle technology under section 201 of division B of the 

16 Clean Energy Jobs and American Power Act— 

17 ‘‘(A) for each of vintage years 2012 through 

18 2017, 2.4 percent of the emission allowances; and 

19 ‘‘(B) for each of vintage years 2018 through 

20 2025, 0.8 percent of the emission allowances. 


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1 ‘‘(9)(A) In addition to the emission allowances 

2 reserved under subsection (d)(6), subject to subpara3 graph (B), for the program for State and local invest4 ment in energy efficiency and renewable energy under 

5 section 202 of division B of the Clean Energy Jobs 

6 and American Power Act, as described in the fol7 lowing table: 

‘‘Investment in energy efficiency and renewable energy 

Vintage Year Percentage of 

allowances 

2012 ............................................................................. 10.35 

2013 ............................................................................. 10.35 

2014 ............................................................................. 8.55 

2015 ............................................................................. 8.55 

2016 ............................................................................. 5.85 

2017 ............................................................................. 6.12 

2018 ............................................................................. 5.22 

2019 ............................................................................. 5.22 

2020 ............................................................................. 4.95 

2021 ............................................................................. 4.95 

2022 ............................................................................. 0.90 

2023 ............................................................................. 0.90 

2024 ............................................................................. 0.90 

2025 ............................................................................. 0.90 

Each of vintage years 2026 through 2050 ................ 4.05 

8 ‘‘(B) At the time at which allowances are dis9 tributed under subparagraph (A) for each of vintage 

10 years 2022 through 2025, 3.2 percent of emission al11 lowances established under section 721(a) for the vin12 tage year that is 4 years after that vintage year shall 

13 also be distributed (which shall be in addition to the 

14 emission allowances distributed under subparagraph 

15 (A) for vintage years 2026 through 2050. 

16 ‘‘(10) For the program for energy efficiency in 

17 building codes under section 163 of division A, and 


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1 section 203 of division B, of the Clean Energy Jobs 

2 and American Power Act, 0.50 percent of the emis3 sion allowances for each of vintage years 2012 

4 through 2050. 

5 ‘‘(11) For the program for Energy Innovation 

6 Hubs pursuant to section 204 of division B of the 

7 Clean Energy Jobs and American Power Act— 

8 ‘‘(A) for each of vintage years 2012 through 

9 2015, 0.75 percent of the emission allowances; 

10 and 

11 ‘‘(B) for each of vintage years 2016 through 

12 2050, 0.45 percent of the emission allowances. 

13 ‘‘(12) For the program for ARPA–E research 

14 pursuant to section 205 of division B of the Clean 

15 Energy Jobs and American Power Act— 

16 ‘‘(A) for each of vintage years 2012 and 

17 2013, 3.25 percent of the emission allowances; 

18 and 

19 ‘‘(B) for each of vintage years 2014 through 

20 2050, 1.25 percent of the emission allowances. 

21 ‘‘(13) For the International Clean Energy De22 ployment Program under section 323 of division A, 

23 and section 206 of division B, of the Clean Energy 

24 Jobs and American Power Act— 


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1 ‘‘(A) for each of vintage years 2012 through 

2 2021, 1.0 percent of the emission allowances; 

3 ‘‘(B) for each of vintage years 2022 through 

4 2026, 2.0 percent of the emission allowances; and 

5 ‘‘(C) for each of vintage years 2027 through 

6 2050, 3.0 percent of the emission allowances. 

7 ‘‘(14) In addition to the emission allowances re8 served under subsection (d)(8), for the international 

9 climate change adaptation and global security pro10 gram under section 324 of division A, and section 207 

11 of division B, of the Clean Energy Jobs and Amer12 ican Power Act— 

13 ‘‘(A) for each of vintage years 2012 through 

14 2021, 1.0 percent of the emission allowances; 

15 ‘‘(B) for each of vintage years 2022 through 

16 2026, 2.0 percent of the emission allowances; and 

17 ‘‘(C) for each of vintage years 2027 through 

18 2050, 5.0 percent of the emission allowances. 

19 ‘‘(15) For State programs for greenhouse gas re20 duction and climate adaptation pursuant to section 

21 210(c) of division B of the Clean Energy Jobs and 

22 American Power Act, as described in the following 

23 table: 

‘‘State programs for greenhouse gas reduction and adaptation 

Vintage Year Percentage of 

allowances 

2012 ............................................................................. 1.34 

2013 ............................................................................. 1.34 


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‘‘State programs for greenhouse gas reduction and adaptation— 

Continued 

2014 ............................................................................. 0.50 

2015 ............................................................................. 0.50 

2016 ............................................................................. 0.50 

2017 ............................................................................. 0.50 

2018 ............................................................................. 0.50 

2019 ............................................................................. 0.50 

2020 ............................................................................. 0.50 

2021 ............................................................................. 0.50 

2022 ............................................................................. 1.06 

2023 ............................................................................. 1.06 

2024 ............................................................................. 1.06 

2025 ............................................................................. 1.06 

2026 ............................................................................. 1.06 

Each of vintage years 2027 through 2050 ................ 2.18 

1 ‘‘(16) For State programs for natural resource 

2 adaptation activities under the program for climate 

3 change safeguards for natural resources conservation 

4 under section 370(a)(1) of division A, and section 216 

5 of division B, of the Clean Energy Jobs and Amer6 ican Power Act, as described in the following table: 

‘‘State programs for natural resource adaptation 

Vintage Year Percentage of 

allowances 

2012 ............................................................................. 0.39 

2013 ............................................................................. 0.39 

2014 ............................................................................. 0.39 

2015 ............................................................................. 0.39 

2016 ............................................................................. 0.39 

2017 ............................................................................. 0.39 

2018 ............................................................................. 0.39 

2019 ............................................................................. 0.39 

2020 ............................................................................. 0.39 

2021 ............................................................................. 0.39 

2022 ............................................................................. 0.77 

2023 ............................................................................. 0.77 

2024 ............................................................................. 0.77 

2025 ............................................................................. 0.77 

2026 ............................................................................. 0.77 

Each of vintage years 2027 through 2050 ................ 1.54 

7 ‘‘(b) AUCTIONS.—Subject to subsection (d), of the total 

8 quantity of emission allowances established for each cal9 endar year under section 721(a), the Administrator shall 


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1 auction, pursuant to section 778, emission allowances for 

2 the purposes and for the vintage or calendar years and cor3 responding percentages specified as follows: 

4 ‘‘(1) Emission allowances reserved under sub5 section (d)(9) for the Market Stability Reserve Fund 

6 under section 726. 

7 ‘‘(2) For the program for climate change con8 sumer refunds and low- and moderate-income con9 sumers pursuant to section 776— 

10 ‘‘(A) emission allowances for consumer re11 bates under section 776(a), pursuant to sub12 section (f)(2); and 

13 ‘‘(B) emission allowances for energy refunds 

14 under section 776(b), as follows: 

15 ‘‘(i) For each of calendar years 2012 

16 through 2029, 15.00 percent of the emission 

17 allowances. 

18 ‘‘(ii) For each of calendar years 2030 

19 through 2050, 18.50 percent of the emission 

20 allowances. 

21 ‘‘(iii) For calendar year 2051 and each 

22 calendar year thereafter, 15.00 percent of 

23 the emission allowances. 


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1 ‘‘(3) For the program for investment in clean ve2 hicle technology under section 201 of division B of the 

3 Clean Energy Jobs and American Power Act— 

4 ‘‘(A) for each of calendar years 2012 

5 through 2017, 0.6 percent of the emission allow6 ances; and 

7 ‘‘(B) for each of calendar years 2018 

8 through 2025, 0.2 percent of the emission allow9 ances. 

10 ‘‘(4) For the program for energy efficiency and 

11 renewable energy worker training under section 208 

12 of division B of the Clean Energy Jobs and American 

13 Power Act— 

14 ‘‘(A) for each of calendar years 2012 and 

15 2013, 1.0 percent of the emission allowances; and 

16 ‘‘(B) for each of calendar years 2014 and 

17 2015, 0.05 percent of the emission allowances. 

18 ‘‘(5) For the program for worker transition 

19 under part 2 of subtitle A of title III of division A, 

20 and section 209 of division B, of the Clean Energy 

21 Jobs and American Power Act— 

22 ‘‘(A) for each of calendar years 2012 

23 through 2021, 0.5 percent of the emission allow24 ances; and 


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1 ‘‘(B) for each of calendar years 2022 

2 through 2050, 1.0 percent of the emission allow3 ances. 

4 ‘‘(6) For the program for public health and cli5 mate change under subpart B of part 1 of subtitle C 

6 of title III of division A, and section 211 of division 

7 B, of the Clean Energy Jobs and American Power 

8 Act, 0.10 percent of the emission allowances for each 

9 of calendar years 2012 through 2050. 

10 ‘‘(7) For the Natural Resources Climate Change 

11 Adaptation Account under the program for climate 

12 change safeguards for natural resources conservation 

13 under paragraphs (2) through (6) of section 370(a) of 

14 division A, and section 212 of division B, of the 

15 Clean Energy Jobs and American Power Act, as de16 scribed in the following table: 

‘‘Natural Resources Climate Change Adaptation Account 

Calendar Year Percentage of 

allowances 

2012 ............................................................................. 0.62 

2013 ............................................................................. 0.62 

2014 ............................................................................. 0.62 

2015 ............................................................................. 0.62 

2016 ............................................................................. 0.62 

2017 ............................................................................. 0.62 

2018 ............................................................................. 0.62 

2019 ............................................................................. 0.62 

2020 ............................................................................. 0.62 

2021 ............................................................................. 0.62 

2022 ............................................................................. 1.23 

2023 ............................................................................. 1.23 

2024 ............................................................................. 1.23 

2025 ............................................................................. 1.23 

2026 ............................................................................. 1.23 

Each of calendar years 2027 through 2050 .............. 2.46 


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1 ‘‘(8) For nuclear worker training under section 

2 132 of division A, and section 213 of division B, of 

3 the Clean Energy Jobs and American Power Act— 

4 ‘‘(A) for each of calendar years 2012 and 

5 2013, 0.5 percent of the emission allowances; and 

6 ‘‘(B) for each of calendar years 2014 and 

7 2015, 0.05 percent of the emission allowances. 

8 ‘‘(9) In addition to the emission allowances re9 served under subsection (d)(3), for the supplemental 

10 agriculture, abandoned mine land, renewable energy, 

11 and forestry greenhouse gas reduction and renewable 

12 energy program under section 155 of division A, and 

13 section 214 of division B, of the Clean Energy Jobs 

14 and American Power Act— 

15 ‘‘(A) for each of calendar years 2012 and 

16 2013, 1.0 percent of the emission allowances; and 

17 ‘‘(B) for each of calendar years 2014 

18 through 2016, 0.28 percent of the emission allow19 ances. 

20 ‘‘(10) TRANSPORTATION GREENHOUSE GAS RE21 DUCTION.—In addition to the emission allowances re22 served under subsection (d)(4), for the transportation 

23 greenhouse gas reduction program under sections 831 

24 and 832 of this Act, and 215 of division B, of the 


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1 Clean Energy Jobs and American Power Act, as de2 scribed in the following table: 

‘‘Transportation greenhouse gas reduction 

Calendar Year Percentage of 

allowances 

2012 ............................................................................. 2.21 

2013 ............................................................................. 2.21 

2014 ............................................................................. 1.35 

2015 ............................................................................. 1.35 

2016 ............................................................................. 1.05 

2017 ............................................................................. 1.08 

2018 ............................................................................. 0.98 

2019 ............................................................................. 0.98 

2020 ............................................................................. 0.95 

2021 ............................................................................. 0.95 

2022 ............................................................................. 0.94 

2023 ............................................................................. 0.94 

2024 ............................................................................. 0.94 

2025 ............................................................................. 0.94 

2026 ............................................................................. 1.64 

2027 ............................................................................. 2.52 

2028 ............................................................................. 2.52 

2029 ............................................................................. 2.52 

Each of calendar years 2030 through 2050 .............. 2.17 

3 ‘‘(c) SUPPLEMENTAL REDUCTIONS.— 

4 ‘‘(1) IN GENERAL.—Subject to subsection (d) and 

5 paragraphs (2) and (3), the Administrator shall allo6 cate allowances for each vintage year to achieve sup7 plemental reductions pursuant to section 753, as fol8 lows: 

9 ‘‘(A) For each of calendar years 2012 

10 through 2025, 5.0 percent of the emission allow11 ances. 

12 ‘‘(B) For each of calendar years 2026 

13 through 2030, 3.0 percent of the emission allow14 ances. 


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1 ‘‘(C) For each of calendar years 2031 

2 through 2050, 2.0 percent of the emission allow3 ances. 

4 ‘‘(2) ADJUSTMENT.—The Administrator shall 

5 modify the allowances allocated under paragraph (1) 

6 as necessary to ensure the achievement of the annual 

7 supplemental emissions reduction objective for 2020 

8 and the cumulative reduction objective through 2025 

9 set forth in section 753(b)(1). 

10 ‘‘(3) CARRYOVER.—If the Administrator has not 

11 distributed all of the allowances allocated pursuant to 

12 this subsection for a given vintage year by the end of 

13 that year, all such undistributed emission allowances 

14 shall, in accordance with subsection (e), be exchanged 

15 for allowances from the following vintage year and 

16 treated as part of the allocation for supplemental re17 ductions under this section for that later vintage year. 

18 ‘‘(d) INITIAL RESERVATION OF ALLOWANCES.— 

19 ‘‘(1) IN GENERAL.—Before allocating emission 

20 allowances under subsections (a) through (c) for each 

21 calendar year, the Administrator shall reserve from 

22 the total quantity of emission allowances established 

23 for the calendar year under section 721(a) the per24 centages of allowances specified in paragraphs (2) 


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1 through (9), for use for the purposes described in those 

2 paragraphs. 

3 ‘‘(2) DEFICIT REDUCTION.—For auction pursu4 ant to section 778 to ensure that this title does not 

5 contribute to the deficit for a calendar year, with pro6 ceeds of the auction to be deposited immediately upon 

7 receipt in the Deficit Reduction Fund established by 

8 section 783, the Administrator shall reserve— 

9 ‘‘(A) for each of calendar years 2012 

10 through 2029, 10 percent of the emission allow11 ances; 

12 ‘‘(B) for each of calendar years 2030 

13 through 2039, 22 percent of the emission allow14 ances; and 

15 ‘‘(C) for each of calendar years 2040 

16 through 2050, 25 percent of the emission allow17 ances. 

18 ‘‘(3) SUPPLEMENTAL AGRICULTURE, ABANDONED

19 MINE LAND, RENEWABLE ENERGY, AND FORESTRY.— 

20 For the supplemental agriculture, abandoned mine 

21 land, renewable energy, and forestry greenhouse gas 

22 reduction and renewable energy program under sec23 tion 155 of division A, and section 214 of division B, 

24 of the Clean Energy Jobs and American Power Act, 

25 the Administrator shall reserve 1.0 percent of the 


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1 emission allowances for each of calendar years 2012 

2 through 2050. 

3 ‘‘(4) TRANSPORTATION GREENHOUSE GAS RE4 DUCTION.—For the transportation greenhouse gas re5 duction program under sections 831 and 832 of this 

6 Act, and section 215 of division B of the Clean En7 ergy Jobs and American Power Act, the Adminis8 trator shall reserve for each of calendar years 2012 

9 through 2050, 1.0 percent of the emission allowances. 

10 ‘‘(5) INDUSTRIAL EMISSIONS.—For the program 

11 to ensure real reductions in industrial emissions 

12 under part F, the Administrator shall reserve 0.50 

13 percent of the emission allowances for each of cal14 endar years 2012 through 2050. 

15 ‘‘(6) STATE AND LOCAL INVESTMENT IN ENERGY

16 EFFICIENCY AND RENEWABLE ENERGY.—For the pro17 gram for State and local investment in energy effi18 ciency and renewable energy under section 202 of di19 vision B of the Clean Energy Jobs and American 

20 Power Act, the Administrator shall reserve 0.50 per21 cent of the emission allowances for each of calendar 

22 years 2012 through 2050. 

23 ‘‘(7) ELECTRICITY CONSUMERS; SMALL LDCS.— 

24 For distribution to small LDCs under the program 


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1 for electricity consumers under section 772(f), the Ad2 ministrator shall reserve— 

3 ‘‘(A) for each of calendar years 2012 

4 through 2025, 0.50 percent of the emission allow5 ances; 

6 ‘‘(B) for calendar year 2026, 0.40 percent of 

7 the emission allowances; 

8 ‘‘(C) for calendar year 2027, 0.30 percent of 

9 the emission allowances; 

10 ‘‘(D) for calendar year 2028, 0.20 percent of 

11 the emission allowances; and 

12 ‘‘(E) for calendar year 2029, 0.10 percent of 

13 the emission allowances. 

14 ‘‘(8) INTERNATIONAL CLIMATE CHANGE ADAPTA15 TION AND GLOBAL SECURITY PROGRAM.—For the 

16 international climate change adaptation and global 

17 security program under section 324 of division A, 

18 and section 207 of division B, of the Clean Energy 

19 Jobs and American Power Act, the Administrator 

20 shall reserve 0.25 percent of the emission allowances 

21 for each of calendar years 2012 through 2026. 

22 ‘‘(9) MARKET STABILITY RESERVE FUND.—For 

23 the Market Stability Reserve Fund under section 726, 

24 the Administrator shall reserve— 


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1 ‘‘(A) for each of calendar years 2012 

2 through 2019, 2.0 percent of the emission allow3 ances; and 

4 ‘‘(B) for each of calendar years 2020 

5 through 2050, 3.0 percent of the emission allow6 ances. 

7 ‘‘(e) TREATMENT OF CARRYOVER ALLOWANCES.— 

8 ‘‘(1) IN GENERAL.—If there are undistributed al9 lowances from a vintage year for eligible industrial 

10 sectors pursuant to subsection (a)(5), deployment of 

11 carbon capture and sequestration technology pursuant 

12 to subsection (a)(6), or supplemental reductions pur13 suant to subsection (c), the Administrator shall— 

14 ‘‘(A) use the undistributed allowances to in15 crease for the same vintage year— 

16 ‘‘(i) the allocation of allowances to be 

17 auctioned, with the proceeds to be deposited 

18 immediately upon receipt in the Deficit Re19 duction Fund established by section 783; 

20 ‘‘(ii) the allocation of allowances for 

21 the program for climate change consumer 

22 refunds and low- and moderate-income con23 sumers pursuant to subsection (b)(2); or 

24 ‘‘(iii) a combination the purposes de25 scribed in clauses (i) and (ii); and 


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1 ‘‘(B) except as provided in paragraph (2)— 

2 ‘‘(i) decrease by the same quantity for 

3 the following vintage year the allocation for 

4 the purpose for which the allocation was in5 creased pursuant to subparagraph (A); and 

6 ‘‘(ii) increase by the same quantity for 

7 the following vintage year the allocation for 

8 the purpose for which the undistributed al9 lowances were originally allocated. 

10 ‘‘(2) EXCESS UNDISTRIBUTED ALLOWANCES.— 

11 ‘‘(A) IN GENERAL.—For each vintage year 

12 for which this subsection applies, the Adminis13 trator shall determine whether— 

14 ‘‘(i) the total quantity of undistributed 

15 allowances for that vintage year that were 

16 allocated pursuant to paragraphs (5)(G) 

17 and (6)(B) of subsection (a), and subsection 

18 (c); exceeds 

19 ‘‘(ii) the total quantity of allowances 

20 allocated pursuant to subsections (b)(2) and 

21 (d)(2) for the following vintage year, de22 creased by the quantity of allowances for 

23 that following vintage year set aside for the 

24 reserve established by section 778(f). 


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1 ‘‘(B) DETERMINATION OF EXCEEDANCE.—If 

2 the Administrator determines under subpara3 graph (A) that the quantity described in sub4 paragraph (A)(i) exceeds the quantity described 

5 in subparagraph (A)(ii)— 

6 ‘‘(i) paragraph (1)(B)(ii) shall not 

7 apply; and 

8 ‘‘(ii) for each purpose described in 

9 paragraphs (5)(G) and (6)(B) of subsection 

10 (a), and subsection (c), for which undistrib11 uted allowances for a given vintage year 

12 were allocated, the Administrator shall in13 crease the allocation for the following vin14 tage year by the quantity that equals the 

15 product obtained by multiplying— 

16 ‘‘(iii) the number of undistributed al17 lowances for that purpose; and 

18 ‘‘(iv) the quantity described in sub19 paragraph (A)(ii) divided by the quantity 

20 described in subparagraph (A)(i). 

21 ‘‘(f) REMAINING ALLOWANCES.—After making the allo22 cations of emission allowances under subsections (a) 

23 through (e) for a calendar year, the Administrator shall al24 locate any emission allowances remaining from the total 


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1 quantity of emission allowances established for the calendar 

2 year under section 721(a)— 

3 ‘‘(1) for each of calendar years 2012 through 

4 2025, for auction in accordance with section 778 and 

5 deposit in the Deficit Reduction Fund established by 

6 section 783; and 

7 ‘‘(2) for each of calendar years 2026 through 

8 2050, for the program for climate change consumer 

9 refunds and low- and moderate-income consumers 

10 pursuant to section 776. 

11 ‘‘SEC. 772. ELECTRICITY CONSUMERS. 

12 ‘‘(a) DEFINITIONS.—In this section: 

13 ‘‘(1) CHP SAVINGS.—The term ‘CHP savings’ 

14 means— 

15 ‘‘(A) CHP system savings from a combined 

16 heat and power system that commences operation 

17 after the date of enactment of this section; and 

18 ‘‘(B) the increase in CHP system savings 

19 from, at any time after the date of the enactment 

20 of this section, upgrading, replacing, expanding, 

21 or increasing the utilization of a combined heat 

22 and power system that commenced operation on 

23 or before the date of enactment of this section. 

24 ‘‘(2) CHP SYSTEM SAVINGS.—The term ‘CHP 

25 system savings’ means the increment of electric output 


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1 of a combined heat and power system that is attrib2 utable to the higher efficiency of the combined system 

3 (as compared to the efficiency of separate production 

4 of the electric and thermal outputs). 

5 ‘‘(3) COAL-FUELED UNIT.—The term ‘coal-fueled 

6 unit’ means a utility unit that derives at least 85 

7 percent of its heat input from coal, petroleum coke, or 

8 any combination of those 2 fuels. 

9 ‘‘(4) COST-EFFECTIVE.—The term ‘cost-effective’, 

10 with respect to an energy efficiency program, means 

11 that the program meets the total resource cost test, 

12 which requires that the net present value of economic 

13 benefits over the life of the program, including avoid14 ed supply and delivery costs and deferred or avoided 

15 investments, is greater than the net present value of 

16 the economic costs over the life of the program, in17 cluding program costs and incremental costs borne by 

18 the energy consumer. 

19 ‘‘(5) ELECTRICITY LOCAL DISTRIBUTION COM20 PANY.—The term ‘electricity local distribution com21 pany’ means an electric utility— 

22 ‘‘(A) that has a legal, regulatory, or con23 tractual obligation to deliver electricity directly 

24 to retail consumers in the United States, regard25 less of whether that entity or another entity sells 


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1 the electricity as a commodity to those retail 

2 consumers; and 

3 ‘‘(B) the retail rates of which, except in the 

4 case of an electric cooperative, are regulated or 

5 set by— 

6 ‘‘(i) a State regulatory authority; 

7 ‘‘(ii) a State or political subdivision 

8 thereof (or an agency or instrumentality of, 

9 or corporation wholly owned by, either of 

10 the foregoing); or 

11 ‘‘(iii) an Indian tribe pursuant to trib12 al law. 

13 ‘‘(6) ELECTRICITY SAVINGS.—The term ‘elec14 tricity savings’ means reductions in electricity con15 sumption, relative to business-as-usual projections, 

16 achieved through measures implemented after the date 

17 of enactment of this section, limited to— 

18 ‘‘(A) customer facility savings of electricity, 

19 adjusted to reflect any associated increase in fuel 

20 consumption at the facility; 

21 ‘‘(B) reductions in distribution system 

22 losses of electricity achieved by a retail electricity 

23 distributor, as compared to losses attributable to 

24 new or replacement distribution system equip25 ment of average efficiency; 


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1 ‘‘(C) CHP savings; and 

2 ‘‘(D) fuel cell savings. 

3 ‘‘(7) FUEL CELL.—The term ‘fuel cell’ means a 

4 device that directly converts the chemical energy of a 

5 fuel and an oxidant into electricity by electrochemical 

6 processes occurring at separate electrodes in the de7 vice. 

8 ‘‘(8) FUEL CELL SAVINGS.—The term ‘fuel cell 

9 savings’ means the electricity saved by a fuel cell that 

10 is installed after the date of enactment of this section, 

11 or by upgrading a fuel cell that commenced operation 

12 on or before the date of enactment of this section, as 

13 a result of the greater efficiency with which the fuel 

14 cell transforms fuel into electricity as compared with 

15 sources of electricity delivered through the grid, pro16 vided that— 

17 ‘‘(A) the fuel cell meets such requirements 

18 relating to efficiency and other operating charac19 teristics as the Federal Energy Regulatory Com20 mission may promulgate by regulation; and 

21 ‘‘(B) the net sales of electricity from the fuel 

22 cell to customers not consuming the thermal out23 put from the fuel cell, if any, do not exceed 50 

24 percent of the total annual electricity generation 

25 by the fuel cell. 


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1 ‘‘(9) INDEPENDENT POWER PRODUCTION FACIL2 ITY.—The term ‘independent power production facil3 ity’ means a facility— 

4 ‘‘(A) that is used for the generation of elec5 tric energy, at least 80 percent of which is sold 

6 at wholesale; and 

7 ‘‘(B) the sales of the output of which are not 

8 subject to retail rate regulation or setting of re9 tail rates by— 

10 ‘‘(i) a State regulatory authority; 

11 ‘‘(ii) a State or political subdivision 

12 thereof (or an agency or instrumentality of, 

13 or corporation wholly owned by, either of 

14 the foregoing); 

15 ‘‘(iii) an electric cooperative; or 

16 ‘‘(iv) an Indian tribe pursuant to trib17 al law. 

18 ‘‘(10) LONG-TERM CONTRACT GENERATOR.— 

19 ‘‘(A) IN GENERAL.—The term ‘long-term 

20 contract generator’ means a qualifying small 

21 power production facility, a qualifying cogenera22 tion facility ), an independent power production 

23 facility, or a facility for the production of elec24 tric energy for sale to others that is owned and 

25 operated by an electric cooperative that is— 


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1 ‘‘(i) a covered entity; and 

2 ‘‘(ii) as of the date of enactment of this 

3 title— 

4 ‘‘(I) a facility with 1 or more 

5 sales or tolling agreements executed be6 fore March 1, 2007, that govern the fa7 cility’s electricity sales and provide for 

8 sales at a price (whether a fixed price 

9 or a price formula) for electricity that 

10 does not allow for recovery of the costs 

11 of compliance with the limitation on 

12 greenhouse gas emissions under this 

13 title, provided that such agreements are 

14 not between entities that were affiliates 

15 of one another at the time at which the 

16 agreements were entered into; or 

17 ‘‘(II) a facility consisting of 1 or 

18 more cogeneration units that makes 

19 useful thermal energy available to an 

20 industrial or commercial process with 

21 1 or more sales agreements executed be22 fore March 1, 2007, that govern the fa23 cility’s useful thermal energy sales and 

24 provide for sales at a price (whether a 

25 fixed price or price formula) for useful 


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1 thermal energy that does not allow for 

2 recovery of the costs of compliance with 

3 the limitation on greenhouse gas emis4 sions under this title, provided that 

5 such agreements are not between enti6 ties that were affiliates of one another 

7 at the time at which the agreements 

8 were entered into. 

9 ‘‘(B) AFFILIATE.—In this paragraph, the 

10 term ‘affiliate’, when used in relation to a cov11 ered entity, means another entity that directly or 

12 indirectly owned or controlled, was owned or 

13 controlled by, or that had 50 percent or more of 

14 its equity interests under common ownership or 

15 control with, the covered entity. 

16 ‘‘(11) MERCHANT COAL UNIT.—The term ‘mer17 chant coal unit’ means a coal-fueled unit that— 

18 ‘‘(A) is or is part of a covered entity; 

19 ‘‘(B) is not owned by a Federal, State, or 

20 regional agency or power authority; and 

21 ‘‘(C) generates electricity solely for sale to 

22 others, provided that all or a portion of such 

23 sales are made by a separate legal entity that— 

24 ‘‘(i) has a full or partial ownership or 

25 leasehold interest in the unit, as certified in 


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1 accordance with such requirements as the 

2 Administrator shall prescribe; and 

3 ‘‘(ii) is not subject to retail rate regu4 lation or setting of retail rates by— 

5 ‘‘(I) a State regulatory authority; 

6 ‘‘(II) a State or political subdivi7 sion thereof (or an agency or instru8 mentality of, or corporation wholly 

9 owned by, either of the foregoing); 

10 ‘‘(III) an electric cooperative; or 

11 ‘‘(IV) an Indian tribe pursuant to 

12 tribal law. 

13 ‘‘(12) MERCHANT COAL UNIT SALES.—The term 

14 ‘merchant coal unit sales’ means sales to others of 

15 electricity generated by a merchant coal unit that are 

16 made by the owner or leaseholder described in para17 graph (11)(C). 

18 ‘‘(13) NEW COAL-FUELED UNIT.—The term ‘new 

19 coal-fueled unit’ means a coal-fueled unit that com20 menced operation on or after January 1, 2009 and 

21 before January 1, 2013. 

22 ‘‘(14) NEW MERCHANT COAL UNIT.—The term 

23 ‘new merchant coal unit’ means a merchant coal 

24 unit— 


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1 ‘‘(A) that commenced operation on or after 

2 January 1, 2009 and before January 1, 2013; 

3 and 

4 ‘‘(B) the actual, on-site construction of 

5 which commenced prior to January 1, 2009. 

6 ‘‘(15) QUALIFIED HYDROPOWER.—The term 

7 ‘qualified hydropower’ means— 

8 ‘‘(A) energy produced from increased effi9 ciency achieved, or additions of capacity made, 

10 on or after January 1, 1988, at a hydroelectric 

11 facility that was placed in service before that 

12 date and does not include additional energy gen13 erated as a result of operational changes not di14 rectly associated with efficiency improvements or 

15 capacity additions; or 

16 ‘‘(B) energy produced from generating ca17 pacity added to a dam on or after January 1, 

18 1988, provided that the Federal Energy Regu19 latory Commission certifies that— 

20 ‘‘(i) the dam was placed in service be21 fore the date of the enactment of this section 

22 and was operated for flood control, naviga23 tion, or water supply purposes and was not 

24 producing hydroelectric power prior to the 

25 addition of such capacity; 


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1 ‘‘(ii) the hydroelectric project installed 

2 on the dam is licensed (or is exempt from 

3 licensing) by the Federal Energy Regulatory 

4 Commission and is in compliance with the 

5 terms and conditions of the license or ex6 emption, and with other applicable legal re7 quirements for the protection of environ8 mental quality, including applicable fish 

9 passage requirements; and 

10 ‘‘(iii) the hydroelectric project installed 

11 on the dam is operated so that the water 

12 surface elevation at any given location and 

13 time that would have occurred in the ab14 sence of the hydroelectric project is main15 tained, subject to any license or exemption 

16 requirements that require changes in water 

17 surface elevation for the purpose of improv18 ing the environmental quality of the affected 

19 waterway. 

20 ‘‘(16) QUALIFYING SMALL POWER PRODUCTION

21 FACILITY; QUALIFYING COGENERATION FACILITY.—The 

22 terms ‘qualifying small power production facility’ 

23 and ‘qualifying cogeneration facility’ have the mean24 ings given those terms in section 3(17)(C) and 


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1 3(18)(B) of the Federal Power Act (16 U.S.C. 

2 796(17)(C) and 796(18)(B)). 

3 ‘‘(17) RENEWABLE ENERGY RESOURCE.—The 

4 term ‘renewable energy resource’ means each of the 

5 following: 

6 ‘‘(A) Wind energy. 

7 ‘‘(B) Solar energy. 

8 ‘‘(C) Geothermal energy. 

9 ‘‘(D) Renewable biomass. 

10 ‘‘(E) Biogas derived exclusively from renew11 able biomass. 

12 ‘‘(F) Biofuels derived exclusively from re13 newable biomass. 

14 ‘‘(G) Qualified hydropower. 

15 ‘‘(H) Marine and hydrokinetic renewable 

16 energy, as that term is defined in section 632 of 

17 the Energy Independence and Security Act of 

18 2007 (42 U.S.C. 17211). 

19 ‘‘(18) SMALL LDC.—The term ‘small LDC’ 

20 means, for any given year, an electricity local dis21 tribution company that delivered less than 4,000,000 

22 megawatt hours of electric energy directly to retail 

23 consumers in the preceding year. 

24 ‘‘(19) STATE REGULATORY AUTHORITY.—The 

25 term ‘State regulatory authority’ has the meaning 


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1 given that term in section 3(17) of the Public Utility 

2 Regulatory Policies Act of 1978 (16 U.S.C. 2602(17)). 

3 ‘‘(20) USEFUL THERMAL ENERGY.—The term 

4 ‘useful thermal energy’ has the meaning given that 

5 term in section 371(7) of the Energy Policy and Con6 servation Act (42 U.S.C. 6341(7)). 

7 ‘‘(b) ELECTRICITY LOCAL DISTRIBUTION COMPA8 NIES.— 

9 ‘‘(1) DISTRIBUTION OF ALLOWANCES.—The Ad10 ministrator shall distribute to electricity local dis11 tribution companies for the benefit of retail rate12 payers the quantity of emission allowances allocated 

13 for the following vintage year pursuant to section 

14 771(a)(1)(A). Notwithstanding the preceding sentence, 

15 the Administrator shall withhold from distribution 

16 under this subsection a quantity of emission allow17 ances equal to the lesser of 14.3 percent of the quan18 tity of emission allowances allocated under section 

19 771(a)(1) for the relevant vintage year, or 105 percent 

20 of the emission allowances for the relevant vintage 

21 year that the Administrator anticipates will be dis22 tributed to merchant coal units and to long-term con23 tract generators, respectively, under subsections (c) 

24 and (d), on the condition that the Administrator shall 

25 be authorized to distribute future vintage year allowVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01481 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ances available to long-term contract generators under 

2 subsection (d) in the case of a shortfall of allowances 

3 in any vintage year, subject to section 772(d)(2). If 

4 not required by subsections (c) and (d) to distribute 

5 all of these reserved allowances, the Administrator 

6 shall distribute any remaining emission allowances to 

7 electricity local distribution companies in accordance 

8 with this subsection. 

9 ‘‘(2) DISTRIBUTION BASED ON EMISSIONS.— 

10 ‘‘(A) IN GENERAL.—For each vintage year, 

11 50 percent of the emission allowances available 

12 for distribution under paragraph (1), after re13 serving allowances for distribution under sub14 sections (c) and (d), shall be distributed by the 

15 Administrator among individual electricity local 

16 distribution companies ratably based on the an17 nual average carbon dioxide emissions attrib18 utable to generation of electricity delivered at re19 tail by each such company during the base pe20 riod determined under subparagraph (B). 

21 ‘‘(B) BASE PERIOD.— 

22 ‘‘(i) VINTAGE YEARS 2012 AND 2013.— 

23 For vintage years 2012 and 2013, an elec24 tricity local distribution company’s base pe25 riod shall be— 


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1 ‘‘(I) calendar years 2006 through 

2 2008; 

3 ‘‘(II) any 3 consecutive calendar 

4 years between 1999 and 2008, inclu5 sive, that such company selects, pro6 vided that the company timely informs 

7 the Administrator of such selection; or 

8 ‘‘(III) calendar year 2012, in the 

9 case of a local distribution company 

10 that— 

11 ‘‘(aa) is located outside of the 

12 Pacific Northwest (as defined in 

13 section 3 of the Pacific Northwest 

14 Electric Power Planning and 

15 Conservation Act (16 U.S.C. 

16 839a)), and purchased long-term 

17 excess Federal power and Hungry 

18 Horse Reservation power from the 

19 Bonneville Power Administration; 

20 and 

21 ‘‘(bb) will no longer have 

22 long-term excess Federal power or 

23 Hungry Horse Reservation power 

24 from the Bonneville Power AdVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01483 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ministration after October 1, 

2 2011. 

3 ‘‘(ii) VINTAGE YEARS 2014 AND THERE4 AFTER.—For vintage years 2014 and there5 after, the base period shall be— 

6 ‘‘(I) the base period selected under 

7 clause (i); or 

8 ‘‘(II) calendar year 2012, in the 

9 case of— 

10 ‘‘(aa) an electricity local dis11 tribution company that owns, co12 owns, or purchases through a 

13 power purchase agreement (wheth14 er directly or through a coopera15 tive arrangement) a substantial 

16 portion of the electricity generated 

17 by a new coal-fueled unit, on the 

18 condition that such company 

19 timely informs the Administrator 

20 of its election to use 2012 as its 

21 base period; or 

22 ‘‘(bb) any small local dis23 tribution company that is located 

24 outside of the Pacific Northwest 

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1 cific Northwest Electric Power 

2 Planning and Conservation Act 

3 (16 U.S.C. 839a)), that purchased 

4 long-term excess Federal power 

5 and Hungry Horse Reservation 

6 power from the Bonneville Power 

7 Administration, and that will no 

8 longer have long-term excess Fed9 eral power or Hungry Horse Res10 ervation power from the Bonne11 ville Power Administration after 

12 October 1, 2011, on the condition 

13 that such company timely informs 

14 the Administrator of its election 

15 to use 2012 as its base period. 

16 ‘‘(C) DETERMINATION OF EMISSIONS.— 

17 ‘‘(i) DETERMINATION FOR 1999–2008.— 

18 As part of the regulations promulgated pur19 suant to subsection (g), the Administrator, 

20 after consultation with the Energy Informa21 tion Administration, shall determine the av22 erage amount of carbon dioxide emissions 

23 attributable to generation of electricity de24 livered at retail by each electricity local dis25 tribution company for each of the years 


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1 1999 through 2008, taking into account en2 tities’ electricity generation, electricity pur3 chases, and electricity sales. In the case of 

4 any electricity local distribution company 

5 that owns, co-owns, or purchases through a 

6 power purchase agreement (whether directly 

7 or through a cooperative arrangement) a 

8 substantial portion of the electricity gen9 erated by, a coal-fueled unit that com10 menced operation after January 1, 2006, 

11 and before December 31, 2008, the Adminis12 trator shall adjust the emissions attributable 

13 to such company’s retail deliveries in cal14 endar years 2006 through 2008 to reflect the 

15 emissions that would have occurred if the 

16 relevant unit were in operation during the 

17 entirety of such 3-year period. 

18 ‘‘(ii) ADJUSTMENTS FOR NEW COAL19 FUELED UNITS.— 

20 ‘‘(I) VINTAGE YEARS 2012 AND

21 2013.—For purposes of emission allow22 ance distributions for vintage years 

23 2012 and 2013, in the case of any elec24 tricity local distribution company that 

25 owns, co-owns, or purchases through a 


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1 power purchase agreement (whether di2 rectly or through a cooperative ar3 rangement) a substantial portion of the 

4 electricity generated by, a new coal5 fueled unit, the Administrator shall 

6 adjust the emissions attributable to 

7 such company’s retail deliveries in the 

8 applicable base period to reflect the 

9 emissions that would have occurred if 

10 the new coal-fueled unit were in oper11 ation during such period. 

12 ‘‘(II) VINTAGE YEAR 2014 AND

13 THEREAFTER.—Not later than nec14 essary for use in making emission al15 lowance distributions under this sub16 section for vintage year 2014, the Ad17 ministrator shall, for any electricity 

18 local distribution company that owns, 

19 co-owns, or purchases through a power 

20 purchase agreement (whether directly 

21 or through a cooperative arrangement) 

22 a substantial portion of the electricity 

23 generated by a new coal-fueled unit 

24 and has selected calendar year 2012 as 

25 its base period pursuant to subparaVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01487 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 graph (B)(ii)(II), determine the 

2 amount of carbon dioxide emissions at3 tributable to generation of electricity 

4 delivered at retail by such company in 

5 calendar year 2012. If the relevant new 

6 coal-fueled unit was not yet oper7 ational by January 1, 2012, the Ad8 ministrator shall adjust such deter9 mination to reflect the emissions that 

10 would have occurred if such unit were 

11 in operation for all of calendar year 

12 2012. 

13 ‘‘(iii) REQUIREMENTS.—Determina14 tions under this paragraph shall be as pre15 cise as practicable, taking into account the 

16 nature of data currently available and the 

17 nature of markets and regulation in effect 

18 in various regions of the country. The fol19 lowing requirements shall apply to such de20 terminations: 

21 ‘‘(I) The Administrator shall de22 termine the amount of fossil fuel-based 

23 electricity delivered at retail by each 

24 electricity local distribution company, 

25 and shall use appropriate emission facVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01488 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 tors to calculate carbon dioxide emis2 sions associated with the generation of 

3 such electricity. 

4 ‘‘(II) Where it is not practical to 

5 determine the precise fuel mix for the 

6 electricity delivered at retail by an in7 dividual electricity local distribution 

8 company, the Administrator may use 

9 the best available data, including aver10 age data on a regional basis with ref11 erence to Regional Transmission Orga12 nizations or regional entities (as that 

13 term is defined in section 215(a)(7) of 

14 the Federal Power Act (16 U.S.C. 

15 824o(a)(7)), to estimate fuel mix and 

16 emissions. Different methodologies may 

17 be applied in different regions if ap18 propriate to obtain the most accurate 

19 estimate. 

20 ‘‘(3) DISTRIBUTION BASED ON DELIVERIES.— 

21 ‘‘(A) INITIAL FORMULA.—Except as pro22 vided in subparagraph (B), for each vintage 

23 year, the Administrator shall distribute 50 per24 cent of the emission allowances available for dis25 tribution under paragraph (1), after reserving 


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1 allowances for distribution under subsections (c) 

2 and (d), among individual electricity local dis3 tribution companies ratably based on each elec4 tricity local distribution company’s annual aver5 age retail electricity deliveries for calendar years 

6 2006 through 2008, unless the owner or operator 

7 of the company selects 3 other consecutive years 

8 between 1999 and 2008, inclusive, and timely 

9 notifies the Administrator of its selection. 

10 ‘‘(B) UPDATING.—Prior to distributing 

11 2015 vintage year emission allowances under 

12 this paragraph and at 3-year intervals there13 after, the Administrator shall update the dis14 tribution formula under this paragraph to reflect 

15 changes in each electricity local distribution 

16 company’s service territory since the most recent 

17 formula was established. For each successive 3- 

18 year period, the Administrator shall distribute 

19 allowances ratably among individual electricity 

20 local distribution companies based on the prod21 uct of— 

22 ‘‘(i) each electricity local distribution 

23 company’s average annual deliveries per 

24 customer during calendar years 2006 

25 through 2008, or during the 3 alternative 


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1 consecutive years selected by such company 

2 under subparagraph (A); and 

3 ‘‘(ii) the number of customers of such 

4 electricity local distribution company in the 

5 most recent year in which the formula is 

6 updated under this subparagraph. 

7 ‘‘(4) PROHIBITION AGAINST EXCESS DISTRIBU8 TIONS.—The regulations promulgated under sub9 section (g) shall ensure that, notwithstanding para10 graphs (2) and (3), no electricity local distribution 

11 company shall receive a greater quantity of allow12 ances under this subsection than is necessary to offset 

13 any increased electricity costs to such company’s re14 tail ratepayers, including increased costs attributable 

15 to purchased power costs, due to enactment of this 

16 title. Any emission allowances withheld from distribu17 tion to an electricity local distribution company pur18 suant to this paragraph shall be distributed among 

19 all remaining electricity local distribution companies 

20 ratably based on emissions pursuant to paragraph 

21 (2). 

22 ‘‘(5) USE OF ALLOWANCES.— 

23 ‘‘(A) RATEPAYER BENEFIT.—Emission al24 lowances distributed to an electricity local dis25 tribution company under this subsection shall be 


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1 used exclusively for the benefit of retail rate2 payers of such electricity local distribution com3 pany and may not be used to support electricity 

4 sales or deliveries to entities or persons other 

5 than such ratepayers. 

6 ‘‘(B) RATEPAYER CLASSES.—In using emis7 sion allowances distributed under this subsection 

8 for the benefit of ratepayers, an electricity local 

9 distribution company shall ensure that ratepayer 

10 benefits are distributed— 

11 ‘‘(i) among ratepayer classes ratably 

12 based on electricity deliveries to each class; 

13 and 

14 ‘‘(ii) equitably among individual rate15 payers within each ratepayer class, includ16 ing entities that receive emission allowances 

17 pursuant to part F. 

18 ‘‘(C) LIMITATION.—In general, an elec19 tricity local distribution company shall not use 

20 the value of emission allowances distributed 

21 under this subsection to provide to any ratepayer 

22 a rebate that is based solely on the quantity of 

23 electricity delivered to such ratepayer. To the ex24 tent an electricity local distribution company 

25 uses the value of emission allowances distributed 


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1 under this subsection to provide rebates, it shall, 

2 to the maximum extent practicable, provide such 

3 rebates with regard to the fixed portion of rate4 payers’ bills or as a fixed credit or rebate on 

5 electricity bills. 

6 ‘‘(D) RESIDENTIAL AND INDUSTRIAL RATE7 PAYERS.—Notwithstanding subparagraph (C), if 

8 compliance with the requirements of this title re9 sults (or would otherwise result) in an increase 

10 in electricity costs for residential or industrial 

11 retail ratepayers of any given electricity local 

12 distribution company (including entities that re13 ceive emission allowances pursuant to part F), 

14 such electricity local distribution company— 

15 ‘‘(i) shall pass through to residential 

16 retail ratepayers as a class their ratable 

17 share (based on deliveries to each ratepayer 

18 class) of the value of the emission allow19 ances that reduce electricity cost impacts on 

20 such ratepayers; and 

21 ‘‘(ii) shall pass through to industrial 

22 ratepayers as a class their ratable share 

23 (based on deliveries to each ratepayer class) 

24 of the value of the emission allowances that 

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1 payers. The electricity local distribution 

2 company may do so based on the quantity 

3 of electricity delivered to individual indus4 trial retail ratepayers. 

5 ‘‘(E) GUIDELINES.—As part of the regula6 tions promulgated under subsection (g), the Ad7 ministrator shall, after consultation with State 

8 and tribal regulatory authorities, prescribe 

9 guidelines for the implementation of the require10 ments of this paragraph. Such guidelines shall 

11 include— 

12 ‘‘(i) requirements to ensure that resi13 dential and industrial retail ratepayers (in14 cluding entities that receive emission allow15 ances under part F) receive their ratable 

16 share of the value of the allowances distrib17 uted to each electricity local distribution 

18 company pursuant to this subsection; and 

19 ‘‘(ii) requirements for measurement, 

20 verification, reporting, and approval of 

21 methods used to assure the use of allowance 

22 values to benefit retail ratepayers. 

23 ‘‘(6) REGULATORY PROCEEDINGS.— 

24 ‘‘(A) REQUIREMENT.—No electricity local 

25 distribution company shall be eligible to receive 


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1 emission allowances under this subsection or sub2 section (e) unless the State regulatory authority 

3 with authority over such company’s retail rates, 

4 or the entity with authority to regulate or set re5 tail electricity rates of an electricity local dis6 tribution company not regulated by a State reg7 ulatory authority, has— 

8 ‘‘(i) after public notice and an oppor9 tunity for comment, promulgated a regula10 tion or completed a rate proceeding (or the 

11 equivalent, in the case of a ratemaking enti12 ty other than a State regulatory authority) 

13 that provides for the full implementation of 

14 the requirements of paragraph (5) of this 

15 subsection and the requirements of sub16 section (e); and 

17 ‘‘(ii) made available to the Adminis18 trator and the public a report describing, in 

19 adequate detail, the manner in which the 

20 requirements of paragraph (5) and the re21 quirements of subsection (e) will be imple22 mented. 

23 ‘‘(B) UPDATING.—The Administrator shall 

24 require, as a condition of continued receipt of 

25 emission allowances under this subsection by an 


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1 electricity local distribution company, that a 

2 new regulation be promulgated or rate pro3 ceeding be completed , after public notice and an 

4 opportunity for comment, and a new report be 

5 made available to the Administrator and the 

6 public, pursuant to subparagraph (A), not less 

7 frequently than every 5 years. 

8 ‘‘(7) PLANS AND REPORTING.— 

9 ‘‘(A) REGULATIONS.—As part of the regula10 tions promulgated under subsection (g), the Ad11 ministrator shall prescribe requirements gov12 erning plans and reports to be submitted in ac13 cordance with this paragraph. 

14 ‘‘(B) PLANS.—Not later than April 30 of 

15 2011 and every 5 years thereafter through 2026, 

16 each electricity local distribution company shall 

17 submit to the Administrator a plan, approved by 

18 the State regulatory authority or other entity 

19 charged with regulating tor setting the retail 

20 rates of such company, describing such com21 pany’s plans for the disposition of the value of 

22 emission allowances to be received pursuant to 

23 this subsection and subsection (e), in accordance 

24 with the requirements of this subsection and sub25 section (e). Such plan shall include a description 


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1 of the manner in which the company will pro2 vide to industrial retail ratepayers (including 

3 entities that receive emission allowances under 

4 part F) their ratable share of the value of such 

5 allowances. 

6 ‘‘(C) REPORTS.—Not later than June 30, 

7 2013, and each calendar year thereafter through 

8 2031, each electricity local distribution company 

9 shall submit a report to the Administrator, and 

10 to the relevant State regulatory authority or 

11 other entity charged with regulating or setting 

12 the retail electricity rates of such company, de13 scribing the disposition of the value of any emis14 sion allowances received by such company in the 

15 prior calendar year pursuant to this subsection 

16 and subsection (e), including— 

17 ‘‘(i) a description of sales, transfer, ex18 change, or use by the company for compli19 ance with obligations under this title, of 

20 any such emission allowances; 

21 ‘‘(ii) the monetary value received by 

22 the company, whether in money or in some 

23 other form, from the sale, transfer, or ex24 change of any such emission allowances; 


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1 ‘‘(iii) the manner in which the com2 pany’s disposition of any such emission al3 lowances complies with the requirements of 

4 this subsection and of subsection (e), includ5 ing each of the requirements of paragraph 

6 (5) of this subsection, including the require7 ment that industrial retail ratepayers (in8 cluding entities that receive emission allow9 ances under part F) receive their ratable 

10 share of the value of such allowances; and 

11 ‘‘(iv) such other information as the Ad12 ministrator may require pursuant to sub13 paragraph (A). 

14 ‘‘(D) PUBLICATION.—The Administrator 

15 shall make available to the public all plans and 

16 reports submitted under this subsection, includ17 ing by publishing such plans and reports on the 

18 Internet. 

19 ‘‘(8) ADMINISTRATOR AUDIT REPORTS.— 

20 ‘‘(A) IN GENERAL.—Each year, the Admin21 istrator shall audit a representative sample of 

22 electricity local distribution companies to ensure 

23 that emission allowances distributed under this 

24 subsection have been used exclusively for the ben25 efit of retail ratepayers and that such companies 


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1 are complying with the requirements of this sub2 section and of subsection (e), including the re3 quirement that residential and industrial retail 

4 ratepayers (including entities that receive emis5 sion allowances under part F) receive their rat6 able share of the value of such allowances. The 

7 Administrator shall assess the degree to which 

8 electric local distribution companies have main9 tained a marginal electric price signal while 

10 protecting consumers on total cost using the 

11 value of emissions allowances. In selecting com12 panies for audit, the Administrator shall take 

13 into account any credible evidence of noncompli14 ance with such requirements. The Administrator 

15 shall make available to the public a report de16 scribing the results of each such audit, including 

17 by publishing such report on the Internet. 

18 ‘‘(B) GAO AUDIT REPORT.—Not later than 

19 April 30, 2015, and every 3 years thereafter 

20 through 2026, the Comptroller General of the 

21 United States, incorporating results from the Ad22 ministrators’ audit report and other relevant in23 formation including distribution company re24 ports, shall conduct an in-depth evaluation and 

25 make available to the public a report on the inVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01499 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 vestments made pursuant to paragraph (5). Said 

2 report shall be made available to the State regu3 latory authority, or the entity with authority to 

4 regulate or set retail electricity rates in the case 

5 of an electricity distribution company that is not 

6 regulated by a State regulatory authority, and 

7 shall include a description of how the distribu8 tion companies in the audit meet or fail to meet 

9 the requirement of paragraph (5), including for 

10 investments made in cost-effective end-use energy 

11 efficiency programs, the lifetime and annual en12 ergy saving benefits, and capacity benefits of 

13 said programs. 

14 ‘‘(C) ADMINISTRATOR COST CONTAINMENT

15 REPORT.—Not later than April 30, 2015 and 

16 every 3 years thereafter through 2026, the Ad17 ministrator shall transmit a report to Congress 

18 containing an evaluation of the disposition of the 

19 value of emission allowances received pursuant 

20 to this subsection and subsection (e) and rec21 ommendations of ways to more effectively direct 

22 the value of allowances to reduce costs for con23 sumers, contain the overall costs of the green24 house gas emissions reduction program, and 

25 meet the pollution reduction targets of the Act. 


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1 The Administrator shall make available to the 

2 public such report, including by publishing such 

3 report on the Internet. 

4 ‘‘(9) ENFORCEMENT.—A violation of any re5 quirement of this subsection or of subsection (e), irre6 spective of approval by a State regulatory authority, 

7 shall be a violation of this Act. Each emission allow8 ance the value of which is used in violation of the re9 quirements of this subsection or of subsection (e) shall 

10 be a separate violation. 

11 ‘‘(c) MERCHANT COAL UNITS.— 

12 ‘‘(1) QUALIFYING EMISSIONS.—The qualifying 

13 emissions for a merchant coal unit for a given cal14 endar year shall be the product of the number of 

15 megawatt hours of merchant coal unit sales generated 

16 by such unit in such calendar year and the average 

17 carbon dioxide emissions per megawatt hour gen18 erated by such unit during the base period under 

19 paragraph (2), provided that the number of megawatt 

20 hours in a given calendar year for purposes of such 

21 calculation shall be reduced in proportion to the por22 tion of such unit’s carbon dioxide emissions that are 

23 either— 

24 ‘‘(A) captured and sequestered in such cal25 endar year; or 


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1 ‘‘(B) attributable to the combustion or gas2 ification of biomass, to the extent that the owner 

3 or operator of the unit is not required to hold 

4 emission allowances for such emissions. 

5 ‘‘(2) BASE PERIOD.—For purposes of this sub6 section, the base period for a merchant coal unit shall 

7 be— 

8 ‘‘(A) calendar years 2006 through 2008; or 

9 ‘‘(B) in the case of a new merchant coal 

10 unit— 

11 ‘‘(i) the first full calendar year of oper12 ation of such unit, if such unit commences 

13 operation before January 1, 2012; 

14 ‘‘(ii) calendar year 2012, if such unit 

15 commences operation on or after January 1, 

16 2012, and before October 1, 2012; or 

17 ‘‘(iii) calendar year 2013, if such unit 

18 commences operation on or after October 1, 

19 2012, and before January 1, 2013. 

20 ‘‘(3) PHASE-DOWN SCHEDULE.—The Adminis21 trator shall identify an annual phase-down factor, 

22 applicable to distributions to merchant coal units for 

23 each of vintage years 2012 through 2029, that cor24 responds to the overall decline in the amount of emis25 sion allowances allocated to the electricity sector in 


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1 such years pursuant to section 771(a)(1). Such factor 

2 shall— 

3 ‘‘(A) for vintage year 2012, be equal to 1.0; 

4 ‘‘(B) for each of vintage years 2013 through 

5 2029, correspond to the quotient of— 

6 ‘‘(i) the quantity of emission allow7 ances allocated under section 771(a)(1) for 

8 such vintage year; divided by 

9 ‘‘(ii) the quantity of emission allow10 ances allocated under section 771(a)(1) for 

11 vintage year 2012. 

12 ‘‘(4) DISTRIBUTION OF EMISSION ALLOW13 ANCES.—Not later than March 1 of 2013 and each 

14 calendar year through 2030, the Administrator shall 

15 distribute emission allowances of the preceding vin16 tage year to the owner or operator of each merchant 

17 coal unit described in subsection (a)(11)(C) in an 

18 amount equal to the product of— 

19 ‘‘(A) 0.5; 

20 ‘‘(B) the qualifying emissions for such mer21 chant coal unit for the preceding year, as deter22 mined under paragraph (1); and 

23 ‘‘(C) the phase-down factor for the preceding 

24 calendar year, as identified under paragraph 

25 (3). 


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1 ‘‘(5) ADJUSTMENT.— 

2 ‘‘(A) STUDY.—Not later than 5 years after 

3 the date of enactment of the Clean Energy Jobs 

4 and American Power Act, the Administrator, in 

5 consultation with the Federal Energy Regulatory 

6 Commission, shall issue a study to determine 

7 whether the allocation formula under paragraph 

8 (3) is resulting in windfall profits to merchant 

9 coal generators or substantially disparate treat10 ment of merchant coal generators operating in 

11 different markets or regions. 

12 ‘‘(B) REGULATION.—If the Administrator, 

13 in consultation with the Federal Energy Regu14 latory Commission, makes an affirmative find15 ing of windfall profits or disparate treatment 

16 under subparagraph (A), the Administrator 

17 shall, not later than 18 months after the comple18 tion of the study described in subparagraph (A), 

19 promulgate regulations providing for the adjust20 ment of the allocation formula under paragraph 

21 (3) to mitigate, to the extent practicable, such 

22 windfall profits, if any, and such disparate 

23 treatment, if any. 

24 ‘‘(6) LIMITATION ON ALLOWANCES.—Notwith25 standing paragraph (4) or (5), for each vintage year 


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1 the Administrator shall distribute under this sub2 section no more than 10 percent of the total quantity 

3 of emission allowances available for such vintage year 

4 for distribution to the electricity sector under section 

5 771(a)(1). If the quantity of emission allowances that 

6 would otherwise be distributed pursuant to paragraph 

7 (4) or (5) for any vintage year would exceed such 

8 limit, the Administrator shall distribute 10 percent of 

9 the total emission allowances available for distribu10 tion under section 771(a)(1) for such vintage year 

11 ratably among merchant coal generators based on the 

12 applicable formula under paragraph (4) or (5). 

13 ‘‘(7) ELIGIBILITY.—The owner or operator of a 

14 merchant coal unit shall not be eligible to receive 

15 emission allowances under this subsection for any 

16 vintage year for which such owner or operator has 

17 elected to receive emission allowances for the same 

18 unit under subsection (d). 

19 ‘‘(d) LONG-TERM CONTRACT GENERATORS.— 

20 ‘‘(1) DISTRIBUTION.—Not later than March 1, 

21 2013, and each calendar year through 2030, the Ad22 ministrator shall distribute to the owner or operator 

23 of each long-term contract generator a quantity of 

24 emission allowances of the preceding vintage year 

25 that is equal to the sum of— 


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1 ‘‘(A) the number of tons of carbon dioxide 

2 emitted as a result of a qualifying electricity 

3 sales agreement referred to in subsection 

4 (a)(10)(B)(i); and 

5 ‘‘(B) the incremental number of tons of car6 bon dioxide emitted solely as a result of a quali7 fying thermal sales agreement referred to in sub8 section (a)(10)(B)(ii), provided that in no event 

9 shall the Administrator distribute more than 1 

10 emission allowance for the same ton of emissions. 

11 ‘‘(2) LIMITATION ON ALLOWANCES.— 

12 ‘‘(A) IN GENERAL.—Notwithstanding para13 graph (1), for each vintage year the Adminis14 trator shall distribute under this subsection no 

15 more than 4.3 percent of the total quantity of 

16 emission allowances available for such vintage 

17 year for distribution to the electricity sector 

18 under section 771(a)(1). 

19 ‘‘(B) FUTURE VINTAGE YEAR ALLOW20 ANCES.— 

21 ‘‘(i) IN GENERAL.—To the extent that 

22 any quantity of allowances that would oth23 erwise be distributed pursuant to paragraph 

24 (1) would exceed 4.3 percent in any vintage 

25 year, the Administrator shall distribute fuVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01506 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ture vintage year allowances reserved for 

2 long-term contract generators under this 

3 section to satisfy any such shortfall in 

4 available allowances, subject to projections 

5 by the Administrator of required allowance 

6 needs for long-term contract generators in 

7 future vintage years. 

8 ‘‘(ii) MAINTENANCE OF YEAR.—Future 

9 vintage year allowances distributed pursu10 ant to this subsection shall maintain the fu11 ture vintage year assigned to those allow12 ances. 

13 ‘‘(C) SHORTFALL.—If the quantity of emis14 sion allowances that would otherwise be distrib15 uted pursuant to paragraph (1) for any vintage 

16 year would result in a shortfall based on a con17 sideration of available allowances under this sub18 section over the entire allocation period, as deter19 mined by the Administrator, the Administrator 

20 shall distribute the emission allowances available 

21 for distribution under section 771(a)(1) for such 

22 vintage year ratably among long-term contract 

23 generators in accordance with paragraph (1). 

24 ‘‘(3) ELIGIBILITY.— 


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1 ‘‘(A) FACILITY ELIGIBILITY.—The owner or 

2 operator of a facility shall cease to be eligible to 

3 receive emission allowances under this subsection 

4 upon the earliest date on which the facility no 

5 longer meets each and every element of the defi6 nition of a long-term contract generator under 

7 subsection (a)(10). 

8 ‘‘(B) CONTRACT ELIGIBILITY.—The owner 

9 or operator of a facility shall cease to be eligible 

10 to receive emission allowances under this sub11 section based on an electricity or thermal sales 

12 agreement referred to in subsection (a)(10)(B) 

13 upon the earliest date that such agreement— 

14 ‘‘(i) expires; 

15 ‘‘(ii) is terminated; or 

16 ‘‘(iii) is amended in any way that 

17 changes the location of the facility, the price 

18 (whether a fixed price or price formula) for 

19 electricity or thermal energy sold under 

20 such agreement, the quantity of electricity 

21 or thermal energy sold under the agreement, 

22 or the expiration or termination date of the 

23 agreement. 

24 ‘‘(4) DEMONSTRATION OF ELIGIBILITY.—To be 

25 eligible to receive allowance distributions under this 


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1 subsection, the owner or operator of a long-term con2 tract generator shall submit each of the following in 

3 writing to the Administrator within 180 days after 

4 the date of enactment of this title, and not later than 

5 September 30 of each vintage year for which such 

6 generator wishes to receive emission allowances: 

7 ‘‘(A) A certificate of representation de8 scribed in section 700(15). 

9 ‘‘(B) An identification of each owner and 

10 each operator of the facility. 

11 ‘‘(C) An identification of the units at the 

12 facility and the location of the facility. 

13 ‘‘(D) A written certification by the des14 ignated representative that the facility meets all 

15 the requirements of the definition of a long-term 

16 contract generator. 

17 ‘‘(E) The expiration date of each qualifying 

18 electricity or thermal sales agreement referred to 

19 in subsection (a)(10)(B). 

20 ‘‘(F) A copy of each qualifying electricity or 

21 thermal sales agreement referred to in subsection 

22 (a)(10)(B). 

23 ‘‘(5) NOTIFICATION.—Not later than 30 days 

24 after, in accordance with paragraph (3), a facility or 

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1 ments for distribution of emission allowances pursu2 ant to this subsection, the designated representative of 

3 such facility shall notify the Administrator in writing 

4 when, and on what basis, such facility or agreement 

5 ceased to meet such requirements. 

6 ‘‘(e) SMALL LDCs.— 

7 ‘‘(1) DISTRIBUTION.—The Administrator shall, 

8 in accordance with this subsection, distribute emis9 sion allowances allocated pursuant to section 

10 771(a)(1)(B) for the following vintage year. Such al11 lowances shall be distributed ratably among small 

12 LDCs based on historic emissions in accordance with 

13 the same measure of such emissions applied to each 

14 such small LDC for the relevant vintage year under 

15 subsection (b)(2) of this section. 

16 ‘‘(2) USES.—A small LDC receiving allowances 

17 under this section shall use such allowances exclu18 sively for the following purposes: 

19 ‘‘(A) Cost-effective programs to achieve elec20 tricity savings, provided that such savings shall 

21 not be transferred or used for compliance with 

22 any renewable electricity standard established 

23 under the Public Utility Regulatory Policies Act 

24 of 1978 (16 U.S.C. 2601 et seq.). 


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1 ‘‘(B) Deployment of technologies to generate 

2 electricity from renewable energy resources, pro3 vided that any Federal renewable electricity 

4 credits issued based on generation supported 

5 under this section shall be submitted to the Fed6 eral Energy Regulatory Commission for vol7 untary retirement and shall not be used for com8 pliance with the Public Utility Regulatory Poli9 cies Act of 1978 (16 U.S.C. 2601 et seq.). 

10 ‘‘(C) Assistance programs to reduce elec11 tricity costs for low-income residential rate12 payers of such small LDC, provided that such 

13 assistance is made available equitably to all resi14 dential ratepayers below a certain income level, 

15 which shall not be higher than 200 percent of the 

16 poverty line (as that term is defined in section 

17 673(2) of the Community Services Block Grant 

18 Act (42 U.S.C. 9902(2)). 

19 ‘‘(D) Costs of compliance associated with 

20 the enactment of this title. 

21 ‘‘(3) REQUIREMENTS.—As part of the regula22 tions promulgated under subsection (g), the Adminis23 trator shall prescribe— 

24 ‘‘(A) after consultation with the Federal 

25 Energy Regulatory Commission, requirements to 


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1 ensure that programs and projects under para2 graph (2)(A) and (B) are consistent with the 

3 standards established by, and effectively supple4 ment electricity savings and generation of elec5 tricity from renewable energy resources achieved 

6 by, the Combined Efficiency and Renewable 

7 Electricity Standard established by law; 

8 ‘‘(B) eligibility criteria and guidelines for 

9 consumer assistance programs for low-income 

10 residential ratepayers under paragraph (2)(C); 

11 and 

12 ‘‘(C) such other requirements as the Admin13 istrator determines appropriate to ensure com14 pliance with the requirements of this subsection. 

15 ‘‘(4) REPORTING.—Reports submitted under sub16 section (b)(7) shall include, in accordance with such 

17 requirements as the Administrator may prescribe— 

18 ‘‘(A) a description of any facilities deployed 

19 under paragraph (2)(A), the quantity of result20 ing electricity generation from renewable energy 

21 resources; 

22 ‘‘(B) an assessment demonstrating the cost23 effectiveness of, and electricity savings achieved 

24 by, programs supported under paragraph (2)(B); 

25 and 


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1 ‘‘(C) a description of assistance provided to 

2 low-income retail ratepayers under paragraph 

3 (2)(C). 

4 ‘‘(f) RURAL ELECTRIC COOPERATIVES, CONSUMER, OR

5 PUBLICLY OWNED SMALL LDCS.— 

6 ‘‘(1) DISTRIBUTION.— 

7 ‘‘(A) IN GENERAL.—The Administrator 

8 shall, in accordance with this subsection, dis9 tribute emission allowances allocated pursuant to 

10 section 771(d)(7) for the following vintage year. 

11 ‘‘(B) METHOD.—Allowances described in 

12 subparagraph (A) shall be distributed ratably, 

13 among rural electric cooperatives and consumer14 owned or publicly owned electricity local dis15 tribution companies that meet the definition of 

16 the term ‘small LDC’ based on historic emis17 sions, in accordance with the same measure of 

18 those emissions applied to each such rural elec19 tric cooperative for the relevant vintage year 

20 under subsection (b)(2). 

21 ‘‘(2) USES.—A small LDC receiving allowances 

22 under this section shall use the allowances only for— 

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1 ance with any renewable electricity standard es2 tablished under the Public Utility Regulatory 

3 Policies Act of 1978 (16 U.S.C. 2601 et seq.); 

4 ‘‘(B) deployment of technologies to generate 

5 electricity from renewable energy resources, on 

6 the condition that any Federal renewable elec7 tricity credits issued based on generation sup8 ported under this section shall— 

9 ‘‘(i) be submitted to the Federal En10 ergy Regulatory Commission for voluntary 

11 retirement; and 

12 ‘‘(ii) not be used for compliance with 

13 the Public Utility Regulatory Policies Act 

14 of 1978 (16 U.S.C. 2601 et seq.); and 

15 ‘‘(C) assistance programs to reduce elec16 tricity costs for low-income residential rate17 payers of the small LDC, on the condition that 

18 the assistance is made available equitably to all 

19 residential ratepayers below a certain income 

20 level, which shall not be higher than 200 percent 

21 of the poverty line (as defined in section 673 of 

22 the Community Services Block Grant Act (42 

23 U.S.C. 9902). 

24 ‘‘(g) REGULATIONS.—Not later than 2 years after the 

25 date of enactment of this title, the Administrator, in conVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01514 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 sultation with the Federal Energy Regulatory Commission, 

2 shall promulgate regulations to implement the requirements 

3 of this section. 

4 ‘‘SEC. 773. NATURAL GAS CONSUMERS. 

5 ‘‘(a) DEFINITION.—For purposes of this section, the 

6 term ‘cost-effective’, with respect to an energy efficiency pro7 gram, means that the program meets the Total Resource 

8 Cost Test, which requires that the net present value of eco9 nomic benefits over the life of the program, including avoid10 ed supply and delivery costs and deferred or avoided invest11 ments, is greater than the net present value of the economic 

12 costs over the life of the program, including program costs 

13 and incremental costs borne by the energy consumer. 

14 ‘‘(b) ALLOCATION.—Not later than June 30, 2015, and 

15 each calendar year thereafter through 2028, the Adminis16 trator shall distribute to natural gas local distribution com17 panies for the benefit of retail ratepayers the quantity of 

18 emission allowances allocated for the following vintage year 

19 pursuant to section 771(a)(2). Such allowances shall be dis20 tributed among local natural gas distribution companies 

21 based on the following formula: 

22 ‘‘(1) INITIAL FORMULA.—Except as provided in 

23 paragraph (2), for each vintage year, the Adminis24 trator shall distribute emission allowances among 

25 natural gas local distribution companies on a pro 


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1 rata basis based on each such company’s annual aver2 age retail natural gas deliveries for 2006 through 

3 2008, unless the owner or operator of the company se4 lects 3 other consecutive years between 1999 and 

5 2008, inclusive, and timely notifies the Administrator 

6 of its selection. 

7 ‘‘(2) UPDATING.—Prior to distributing 2019 vin8 tage emission allowances and at 3-year intervals 

9 thereafter, the Administrator shall update the dis10 tribution formula under this subsection to reflect 

11 changes in each natural gas local distribution com12 pany’s service territory since the most recent formula 

13 was established. For each successive 3-year period, the 

14 Administrator shall distribute allowances on a pro 

15 rata basis among natural gas local distribution com16 panies based on the product of— 

17 ‘‘(A) each natural gas local distribution 

18 company’s average annual natural gas deliveries 

19 per customer during calendar years 2006 

20 through 2008, or during the 3 alternative con21 secutive years selected by such company under 

22 paragraph (1); and 

23 ‘‘(B) the number of customers of such nat24 ural gas local distribution company in the most 


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1 recent year in which the formula is updated 

2 under this paragraph. 

3 ‘‘(c) USE OF ALLOWANCES.— 

4 ‘‘(1) RATEPAYER BENEFIT.—Emission allow5 ances distributed to a natural gas local distribution 

6 company under this section shall be used exclusively 

7 for the benefit of retail ratepayers of such natural gas 

8 local distribution company and may not be used to 

9 support natural gas sales or deliveries to entities or 

10 persons other than such ratepayers. 

11 ‘‘(2) RATEPAYER CLASSES.—In using emission 

12 allowances distributed under this section for the ben13 efit of ratepayers, a natural gas local distribution 

14 company shall ensure that ratepayer benefits are dis15 tributed— 

16 ‘‘(A) among ratepayer classes on a pro rata 

17 basis based on natural gas deliveries to each 

18 class; and 

19 ‘‘(B) equitably among individual ratepayers 

20 within each ratepayer class. 

21 ‘‘(3) LIMITATION.—A natural gas local distribu22 tion company shall not use the value of emission al23 lowances distributed under this section to provide to 

24 any ratepayer a rebate that is based solely on the 

25 quantity of natural gas delivered to such ratepayer. 


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1 To the extent a natural gas local distribution com2 pany uses the value of emission allowances distributed 

3 under this section to provide rebates, it shall, to the 

4 maximum extent practicable, provide such rebates 

5 with regard to the fixed portion of ratepayers’ bills or 

6 as a fixed creditor rebate on natural gas bills. 

7 ‘‘(4) ENERGY EFFICIENCY PROGRAMS.—The 

8 value of no less than one-third of the emission allow9 ances distributed to natural gas local distribution 

10 companies pursuant to this section in any calendar 

11 year shall be used for cost-effective energy efficiency 

12 programs for natural gas consumers. Such programs 

13 must be authorized and overseen by the State regu14 latory authority, or by the entity with regulatory au15 thority over retail natural gas rates in the case of a 

16 natural gas local distribution company that is not 

17 regulated by a State regulatory authority. 

18 ‘‘(5) CERTAIN INTRACOMPANY DELIVERIES.—If a 

19 natural gas local distribution company makes an 

20 intracompany delivery of natural gas to a customer 

21 that is not a covered entity, for which such company 

22 is required to hold emission allowances under section 

23 722, such customer shall, for purposes of this section, 

24 be considered to be a retail ratepayer and a member 

25 of a ratepayer class to be determined by the relevant 


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1 State regulatory authority (or other entity with au2 thority to regulate or set natural gas rates, in the case 

3 of a company not regulated by a State regulatory au4 thority). 

5 ‘‘(6) GUIDELINES.—As part of the regulations 

6 promulgated under subsection (h), the Administrator 

7 shall prescribe specific guidelines for the implementa8 tion of the requirements of this subsection. 

9 ‘‘(d) REGULATORY PROCEEDINGS.— 

10 ‘‘(1) REQUIREMENT.—No natural gas local dis11 tribution company shall be eligible to receive emission 

12 allowances under this section unless the State regu13 latory authority with authority over such company, 

14 or the entity with authority to regulate retail rates of 

15 a natural gas local distribution company not regu16 lated by a State regulatory authority, has— 

17 ‘‘(A) promulgated a regulation or completed 

18 a rate proceeding (or the equivalent, in the case 

19 of a ratemaking entity other than a State regu20 latory authority) that provides for the full imple21 mentation of the requirements of subsection (c); 

22 and 

23 ‘‘(B) made available to the Administrator 

24 and the public a report describing, in adequate 


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1 detail, the manner in which the requirements of 

2 subsection (c) will be implemented. 

3 ‘‘(2) UPDATING.—The Administrator shall re4 quire, as a condition of continued receipt of emission 

5 allowances under this section, that a new regulation 

6 be promulgated or rate proceeding be completed, and 

7 a new report be made available to the Administrator 

8 and the public, pursuant to paragraph (1), not less 

9 frequently than every 5 years. 

10 ‘‘(e) PLANS AND REPORTING.— 

11 ‘‘(1) REGULATIONS.—As part of the regulations 

12 promulgated under subsection (h), the Administrator 

13 shall prescribe requirements governing plans and re14 ports to be submitted in accordance with this sub15 section. 

16 ‘‘(2) PLANS.—Not later than April 30, 2015, and 

17 every 5 years thereafter through 2025, each natural 

18 gas local distribution company shall submit to the 

19 Administrator a plan, approved by the State regu20 latory authority or other entity charged with regu21 lating the retail rates of such company, describing 

22 such company’s plans for the disposition of the value 

23 of emission allowances to be received pursuant to this 

24 section, in accordance with the requirements of this 

25 section. 


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1 ‘‘(3) REPORTS.—Not later than June 30, 2017, 

2 and each calendar year thereafter through 2031, each 

3 natural gas local distribution company shall submit 

4 a report to the Administrator, approved by the rel5 evant State regulatory authority or other entity 

6 charged with regulating the retail natural gas rates 

7 of such company, describing the disposition of the 

8 value of any emission allowances received by such 

9 company in the prior calendar year pursuant to this 

10 subsection, including— 

11 ‘‘(A) a description of sales, transfer, ex12 change, or use by the company for compliance 

13 with obligations under this title, of any such 

14 emission allowances; 

15 ‘‘(B) the monetary value received by the 

16 company, whether in money or in some other 

17 form, from the sale, transfer, or exchange of 

18 emission allowances received by the company 

19 under this section; 

20 ‘‘(C) the manner in which the company’s 

21 disposition of emission allowances received under 

22 this subsection complies with the requirements of 

23 this section, including each of the requirements 

24 of subsection (c); 


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1 ‘‘(D) the cost-effectiveness of, and energy 

2 savings achieved by, energy efficiency programs 

3 supported through such emission allowances; and 

4 ‘‘(E) such other information as the Admin5 istrator may require pursuant to paragraph (1). 

6 ‘‘(4) PUBLICATION.—The Administrator shall 

7 make available to the public all plans and reports 

8 submitted by natural gas local distribution companies 

9 under this subsection, including by publishing such 

10 plans and reports on the Internet. 

11 ‘‘(f) AUDITING.— 

12 ‘‘(1) ADMINISTRATOR AUDIT REPORT.—Each 

13 year, the Administrator shall audit a significant rep14 resentative sample of natural gas local distribution 

15 companies to ensure that emission allowances distrib16 uted under this section have been used exclusively for 

17 the benefit of retail ratepayers and that such compa18 nies are complying with the requirements of this sec19 tion. In selecting companies for audit, the Adminis20 trator shall take into account any credible evidence of 

21 noncompliance with such requirements. The Adminis22 trator shall make available to the public a report de23 scribing the results of each such audit, including by 

24 publishing such report on the Internet. 


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1 ‘‘(2) GAO AUDIT REPORT.—Not later April 30, 

2 2015 and every 3 years thereafter through April 30, 

3 2026, the Comptroller General of the United States, 

4 incorporating results from the Administrators’ audit 

5 report and other relevant information including dis6 tribution company reports, shall conduct an in-depth 

7 evaluation and make available to the public a report 

8 on the investments made pursuant to subsection (c). 

9 Said report shall be made available to the State regu10 latory authority, or the entity with authority to regu11 late or set retail natural gas rates in the case of a 

12 natural gas distribution company that is not regu13 lated by a State regulatory authority, and shall in14 clude a description how the distribution companies in 

15 the audit meet or fail to meet the requirement of sub16 section (c), including for investments made in cost-ef17 fective end-use energy efficiency programs, the lifetime 

18 and annual energy saving benefits, and capacity ben19 efits of said programs. 

20 ‘‘(3) ADMINISTRATOR COST CONTAINMENT RE21 PORT.—Not later April 30, 2015, and every 3 years 

22 thereafter through April 30, 2026, the Administrator 

23 shall transmit a report to Congress containing an 

24 evaluation of the disposition of the value of emission 

25 allowances received pursuant to this subsection and 


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1 recommendations of ways to more effectively direct 

2 the value of allowances to reduce costs for consumers, 

3 contain the overall costs of the greenhouse gas emis4 sions reduction program, and meet the pollution re5 duction targets of the Act. The Administrator shall 

6 make available to the public such report, including by 

7 publishing such report on the Internet. 

8 ‘‘(g) ENFORCEMENT.—A violation of any requirement 

9 of this section, irrespective of approval by a State regu10 latory authority, shall be a violation of this Act. Each emis11 sion allowance the value of which is used in violation of 

12 the requirements of this section shall be a separate violation. 

13 ‘‘(h) REGULATIONS.—Not later than January 1, 2014, 

14 the Administrator, in consultation with the Federal Energy 

15 Regulatory Commission, shall promulgate regulations to 

16 implement the requirements of this section. 

17 ‘‘SEC. 774. HOME HEATING OIL AND PROPANE CONSUMERS. 

18 ‘‘(a) DEFINITIONS.—For purposes of this section: 

19 ‘‘(1) CARBON CONTENT.—The term ‘carbon con20 tent’ means the amount of carbon dioxide that would 

21 be emitted as a result of the combustion of a fuel. 

22 ‘‘(2) COST-EFFECTIVE.—The term ‘cost-effective’ 

23 has the meaning given that term in section 773(a). 

24 ‘‘(b) ALLOCATION.—The Administrator shall distribute 

25 among the States, in accordance with this section, the quanVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01524 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 tity of emission allowances allocated pursuant to section 

2 771(a)(3). The Administrator shall distribute a percentage 

3 of such allowances determined by the Administrator, after 

4 consultation with the Secretary of the Interior, pursuant 

5 to subsection (f). 

6 ‘‘(c) DISTRIBUTION AMONG STATES.—The Adminis7 trator shall distribute emission allowances among the States 

8 under this section each year on a pro rata basis based on 

9 the ratio of— 

10 ‘‘(1) the carbon content of home heating oil and 

11 propane sold to consumers within each State in the 

12 preceding year for residential or commercial uses; to 

13 ‘‘(2) the carbon content of home heating oil and 

14 propane sold to consumers within the United States 

15 in the preceding year for residential or commercial 

16 uses. 

17 ‘‘(d) USE OF ALLOWANCES.— 

18 ‘‘(1) IN GENERAL.—States shall use emission al19 lowances distributed under this section exclusively for 

20 the benefit of consumers of home heating oil or pro21 pane for residential or commercial purposes. Such 

22 proceeds shall be used exclusively for— 

23 ‘‘(A) cost-effective energy efficiency pro24 grams for consumers that use home heating oil or 


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1 propane for residential or commercial purposes; 

2 or 

3 ‘‘(B) rebates or other direct financial assist4 ance programs for consumers of home heating oil 

5 or propane used for residential or commercial 

6 purposes. 

7 ‘‘(2) ADMINISTRATION AND DELIVERY MECHA8 NISMS.—In administering programs supported by 

9 this section, States shall— 

10 ‘‘(A) use no less than 50 percent of the value 

11 of emission allowances received under this sec12 tion for cost-effective energy efficiency programs 

13 to reduce consumers’ overall fuel costs; 

14 ‘‘(B) to the extent practicable, deliver con15 sumer support under this section through exist16 ing energy efficiency and consumer energy as17 sistance programs or delivery mechanisms, in18 cluding, where appropriate, programs or mecha19 nisms administered by parties other than the 

20 State; and 

21 ‘‘(C) seek to coordinate the administration 

22 and delivery of energy efficiency and consumer 

23 energy assistance programs supported under this 

24 section, with one another and with existing pro25 grams for various fuel types, so as to deliver 


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1 comprehensive, fuel-blind, coordinated programs 

2 to consumers. 

3 ‘‘(e) REPORTING.—Each State receiving emission al4 lowances under this section shall submit to the Adminis5 trator, within 12 months of each receipt of such allowances, 

6 a report, in accordance with such requirements as the Ad7 ministrator may prescribe, that— 

8 ‘‘(1) describes the State’s use of emission allow9 ances distributed under this section, including a de10 scription of the energy efficiency and consumer assist11 ance programs supported with such allowances; 

12 ‘‘(2) demonstrates the cost-effectiveness of, and 

13 the energy savings achieved by, energy efficiency pro14 grams supported under this section; and 

15 ‘‘(3) includes a report prepared by an inde16 pendent third party, in accordance with such regula17 tions as the Administrator may promulgate, evalu18 ating the performance of the energy efficiency and 

19 consumer assistance programs supported under this 

20 section. 

21 ‘‘(f) DISTRIBUTION TO INDIAN TRIBES.—Not later 

22 than 18 months after the date of enactment of this title, 

23 the Administrator shall, in consultation with the Secretary 

24 of the Interior and Indian tribes, promulgate regulations 


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1 establishing a program to distribute the emission allow2 ances made available to Indian tribes under this section. 

3 ‘‘(g) ENFORCEMENT.— 

4 ‘‘(1) IN GENERAL.—If the Administrator deter5 mines that a State or Indian tribe is not in compli6 ance with this section, the Administrator may with7 hold a portion of the emission allowances, the quan8 tity of which is equal to up to twice the quantity of 

9 the allowances that the State or Indian tribe failed to 

10 use in accordance with the requirements of this sec11 tion, that such State or Indian tribe would otherwise 

12 be eligible to receive under this section in later years. 

13 ‘‘(2) WITHHELD ALLOWANCES.— 

14 ‘‘(A) STATES.—Allowances withheld from 

15 States pursuant to this subsection shall be dis16 tributed among the remaining States on a pro 

17 rata basis in accordance with the formula in 

18 subsection (c). 

19 ‘‘(B) INDIAN TRIBES.—Allowances withheld 

20 from Indian tribes pursuant to this subsection 

21 shall be distributed among the remaining Indian 

22 tribes on a pro rata basis in accordance with the 

23 program established under subsection (f). 


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1 ‘‘SEC. 775. DOMESTIC FUEL PRODUCTION. 

2 ‘‘(a) PURPOSE.—The purpose of this section is to pro3 vide emission allowance rebates to petroleum refineries in 

4 the United States in a manner that promotes energy effi5 ciency and a reduction in greenhouse gas emissions at such 

6 facilities. 

7 ‘‘(b) DEFINITIONS.—In this section: 

8 ‘‘(1) EMISSIONS.—The term ‘emissions’ includes 

9 direct emissions from fuel combustion, process emis10 sions, and indirect emissions from the generation of 

11 electricity, steam, and hydrogen used to produce the 

12 output of a petroleum refinery or the petroleum refin13 ery sector. 

14 ‘‘(2) PETROLEUM REFINERY.—The term ‘petro15 leum refinery’ means a facility classified under code 

16 324110 of the North American Industrial Classifica17 tion System of 2002. 

18 ‘‘(3) SMALL BUSINESS REFINER.—The term 

19 ‘small business refiner’ means a refiner that meets the 

20 applicable Federal refinery capacity and employee 

21 limitations criteria described in section 45H(c)(1) of 

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

23 date of enactment of this section and without regard 

24 to section 45H(d)). Eligibility of a small business re25 finer under this paragraph shall not be recalculated 

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1 other small business refiner or refiners after December 

2 31, 2002 or (ii) its acquisition of another small busi3 ness refiner (or refinery of such refiner) after Decem4 ber 31, 2002. 

5 ‘‘(c) DISTRIBUTION OF ALLOWANCES.—The Adminis6 trator shall distribute allowances pursuant to this section 

7 to owners and operators of petroleum refineries, including 

8 small business refiners, in the United States. 

9 ‘‘(d) DISTRIBUTION SCHEDULE.—The Administrator 

10 shall distribute emission allowances pursuant to the regula11 tions issued under subsection (e) for each vintage year no 

12 later than October 31 of the preceding calendar year. 

13 ‘‘(e) REGULATIONS.— 

14 ‘‘(1) IN GENERAL.—Not later than 3 years after 

15 the date of enactment of this title, the Administrator, 

16 in consultation with the Administrator of the Energy 

17 Information Administration, shall promulgate regula18 tions in accordance with the purpose of this section 

19 that establish separate formulas for distribution of 

20 emission allowances provided to— 

21 ‘‘(A) petroleum refineries pursuant to sec22 tion 771(a)(4)(A); and 

23 ‘‘(B) small business refiners pursuant to 

24 section 771(a)(4)(B). 


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1 ‘‘(2) CONSIDERATIONS.—In establishing the for2 mulas under paragraph (1), the Administrator shall 

3 consider— 

4 ‘‘(A) the relative complexity of refinery 

5 processes and appropriate mechanisms to take 

6 energy efficiency and greenhouse gas reductions 

7 into account; 

8 ‘‘(B) direct emissions from fuel combustion; 

9 ‘‘(C) process emissions; 

10 ‘‘(D) indirect emissions for the generation of 

11 electricity, steam, and hydrogen used to produce 

12 the output of a petroleum refinery; and 

13 ‘‘(E) emissions from the combustion of 

14 products produced at a petroleum refinery or by 

15 the petroleum refinery sector. 

16 ‘‘(3) EXCESS DISTRIBUTION.—If the electricity 

17 provider for a petroleum refinery received a free allo18 cation of emission allowances pursuant to section 

19 771(a)(1), the Administrator shall take the free allo20 cation into account when establishing the applicable 

21 formula under this subsection to avoid rebates to a 

22 petroleum refinery for costs that the Administrator 

23 determines were not incurred by the petroleum refin24 ery because the allowances were— 


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1 ‘‘(A) freely allocated to the electricity pro2 vider of the petroleum refinery; and 

3 ‘‘(B) used for the benefit of the petroleum 

4 refinery. 

5 ‘‘SEC. 776. CONSUMER PROTECTION. 

6 ‘‘(a) CONSUMER REBATES.— 

7 ‘‘(1) ESTABLISHMENT OF FUND.—There is estab8 lished in the Treasury a separate account, to be 

9 known as the ‘Consumer Rebate Fund’). 

10 ‘‘(2) AVAILABILITY OF AMOUNTS.—All amounts 

11 deposited in the Consumer Rebate Fund shall be 

12 available without further appropriation or fiscal year 

13 limitation. 

14 ‘‘(3) DISTRIBUTION OF AMOUNTS.—Beginning in 

15 2026, for each year after deposits are made in the 

16 Consumer Rebate Fund pursuant to section 

17 771(b)(2)(A), the President shall use the funds in ac18 cordance with Federal statutory authority to provide 

19 relief to consumers and others affected by the enact20 ment of the Clean Energy Jobs and American Power 

21 Act (and amendments made by that Act). 

22 ‘‘(b) ENERGY REFUND PROGRAM.— 

23 ‘‘(1) ESTABLISHMENT OF FUND.—There is estab24 lished in the Treasury a separate account, to be 

25 known as the ‘Energy Refund Account’). 


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1 ‘‘(2) AVAILABILITY OF AMOUNTS.—All amounts 

2 deposited in the Energy Refund Account shall be 

3 available without further appropriation or fiscal year 

4 limitation. 

5 ‘‘(3) DISTRIBUTION OF AMOUNTS.—For each 

6 year after deposits are made to the Energy Refund 

7 Account pursuant to section 771(b)(2)(B), the Presi8 dent shall use the funds in accordance with Federal 

9 statutory authority to offset energy cost impacts on 

10 low- and moderate-income households. 

11 ‘‘SEC. 777. EXCHANGE FOR STATE-ISSUED ALLOWANCES. 

12 ‘‘(a) IN GENERAL.—Not later than 1 year after the 

13 date of enactment of this title, the Administrator shall issue 

14 regulations allowing any person in the United States to ex15 change greenhouse gas emission allowances issued before the 

16 later of December 31, 2011, or the date that is 9 months 

17 after the first auction under section 778, by the State of 

18 California or for the Regional Greenhouse Gas Initiative, 

19 or the Western Climate Initiative (in this section referred 

20 to as ‘State allowances’) for emission allowances established 

21 by the Administrator under section 721(a). 

22 ‘‘(b) REGULATIONS.—Regulations issued under sub23 section (a) shall— 

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1 ances established under section 721(a) in the amount 

2 that is sufficient to compensate for the cost of obtain3 ing and holding such State allowances; 

4 ‘‘(2) establish a deadline by which persons must 

5 exchange the State allowances; 

6 ‘‘(3) provide that the Federal emission allow7 ances disbursed pursuant to this section shall be de8 ducted from the allowances to be auctioned pursuant 

9 to section 771(b); and 

10 ‘‘(4) require that, once exchanged, the credit or 

11 other instrument be retired for purposes of use under 

12 the program by or for which it was originally issued. 

13 ‘‘(c) COST OF OBTAINING STATE ALLOWANCE.—For 

14 purposes of this section, the cost of obtaining a State allow15 ance shall be the average auction price, for emission allow16 ances issued in the year in which the State allowance was 

17 issued, under the program under which the State allowance 

18 was issued. 

19 ‘‘SEC. 778. AUCTION PROCEDURES. 

20 ‘‘(a) IN GENERAL.—To the extent that auctions of 

21 emission allowances by the Administrator are authorized 

22 by this part, such auctions shall be carried out pursuant 

23 to this section and the regulations established hereunder. 

24 ‘‘(b) INITIAL REGULATIONS.—Not later than 12 

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1 istrator, in consultation with other agencies, as appro2 priate, shall promulgate regulations governing the auction 

3 of allowances under this section. Such regulations shall in4 clude the following requirements: 

5 ‘‘(1) FREQUENCY; FIRST AUCTION.—Auctions 

6 shall be held four times per year at regular intervals, 

7 with the first auction to be held no later than March 

8 31, 2011. 

9 ‘‘(2) AUCTION SCHEDULE; CURRENT AND FU10 TURE VINTAGES.—The Administrator shall, at each 

11 quarterly auction under this section, offer for sale 

12 both a portion of the allowances with the same vin13 tage year as the year in which the auction is being 

14 conducted and a portion of the allowances with vin15 tage years from future years. The preceding sentence 

16 shall not apply to auctions held before 2012, during 

17 which period, by necessity, the Administrator shall 

18 auction only allowances with a vintage year that is 

19 later than the year in which the auction is held. Be20 ginning with the first auction and at each quarterly 

21 auction held thereafter, the Administrator may offer 

22 for sale allowances with vintage years of up to 4 

23 years after the year in which the auction is being con24 ducted. 


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1 ‘‘(3) AUCTION FORMAT.—Auctions shall follow a 

2 single-round, sealed-bid, uniform price format. 

3 ‘‘(4) PARTICIPATION; FINANCIAL ASSURANCE.— 

4 Auctions shall be open to any person, except that the 

5 Administrator may establish financial assurance re6 quirements to ensure that auction participants can 

7 and will perform on their bids. 

8 ‘‘(5) DISCLOSURE OF BENEFICIAL OWNERSHIP.— 

9 Each bidder in the auction shall be required to dis10 close the person or entity sponsoring or benefitting 

11 from the bidder’s participation in the auction if such 

12 person or entity is, in whole or in part, other than 

13 the bidder. 

14 ‘‘(6) PURCHASE LIMITS.—No person may, di15 rectly or in concert with another participant, pur16 chase more than 5 percent of the allowances offered 

17 for sale at any quarterly auction. 

18 ‘‘(7) PUBLICATION OF INFORMATION.—After the 

19 auction, the Administrator shall, in a timely fashion, 

20 publish the identities of winning bidders, the quantity 

21 of allowances obtained by each winning bidder, and 

22 the auction clearing price. 

23 ‘‘(8) OTHER REQUIREMENTS.—The Adminis24 trator may include in the regulations such other re25 quirements or provisions as the Administrator, in 


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1 consultation with other agencies, as appropriate, con2 siders appropriate to promote effective, efficient, 

3 transparent, and fair administration of auctions 

4 under this section. 

5 ‘‘(c) REVISION OF REGULATIONS.—The Administrator 

6 may, in consultation with other agencies, as appropriate, 

7 at any time, revise the initial regulations promulgated 

8 under subsection (b) by promulgating new regulations. 

9 Such revised regulations need not meet the requirements 

10 identified in subsection (b) if the Administrator determines 

11 that an alternative auction design would be more effective, 

12 taking into account factors including costs of administra13 tion, transparency, fairness, and risks of collusion or ma14 nipulation. In determining whether and how to revise the 

15 initial regulations under this subsection, the Administrator 

16 shall not consider maximization of revenues to the Federal 

17 Government. 

18 ‘‘(d) RESERVE AUCTION PRICE.—The minimum re19 serve auction price shall be $10 (in constant 2005 dollars) 

20 for auctions occurring in 2012. The minimum reserve price 

21 for auctions occurring in years after 2012 shall be the min22 imum reserve auction price for the previous year increased 

23 by 5 percent plus the rate of inflation (as measured by the 

24 Consumer Price Index for all urban consumers). 


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1 ‘‘(e) DELEGATION OR CONTRACT.—Pursuant to regula2 tions under this section, the Administrator may by delega3 tion or contract provide for the conduct of auctions under 

4 the Administrator’s supervision by other departments or 

5 agencies of the Federal Government or by nongovernmental 

6 agencies, groups, or organizations. 

7 ‘‘(f) SMALL BUSINESS REFINER RESERVE.—The Ad8 ministrator shall, in accordance with this subsection, issue 

9 regulations setting aside a specified number of allowances, 

10 as determined by the Administrator, that small business re11 finers may purchase at the average auction price and may 

12 use to demonstrate compliance pursuant to section 722. 

13 These regulations shall provide the following: 

14 ‘‘(1) AMOUNT.—The Administrator shall place in 

15 the small business refiner reserve account allowances 

16 that are to be sold at auction pursuant to the alloca17 tions under section 771 in an amount equal to— 

18 ‘‘(A) for each of vintage years 2012 and 

19 2013, 6.2 percent of the emission allowances es20 tablished under section 721(a); 

21 ‘‘(B) for each of vintage years 2014 and 

22 2015, 5.4 percent of the emission allowances es23 tablished under section 721(a); and 


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1 ‘‘(C) for each of vintage years 2016 through 

2 2024, 4.9 percent of the emission allowances es3 tablished under section 721(a). 

4 ‘‘(2) ALLOWED PURCHASES.—From January 1 

5 of the calendar year that matches the vintage year for 

6 which allowances have been placed in the reserve, 

7 through January 14 of the following year, small busi8 ness refiners (as defined in section 775(b)) may pur9 chase allowances from this reserve at the price deter10 mined pursuant to paragraph (3). 

11 ‘‘(3) PRICE.—The price for allowances purchased 

12 from this reserve shall be the average auction price for 

13 allowances of the same vintage year purchased at auc14 tions conducted pursuant to this section during the 12 

15 months preceding the purchase of the allowances. 

16 ‘‘(4) USE OF ALLOWANCES.—Allowances pur17 chased from this reserve shall only be used by the pur18 chaser to demonstrate compliance pursuant to section 

19 722 for attributable greenhouse gas emissions in the 

20 calendar year that matches the vintage year of the 

21 purchased allowance. Allowances purchased from this 

22 reserve may not be banked, traded or borrowed. 

23 ‘‘(5) LIMITATIONS ON PURCHASE AMOUNT.—The 

24 Administrator, by regulation adopted after public no25 tice and an opportunity for comment, shall establish 


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1 procedures to distribute the ability to purchase allow2 ances from the reserve fairly among all small business 

3 refiners interested in purchasing allowances from this 

4 reserve so as to address the potential that requests to 

5 purchase allowances exceed the number of allowances 

6 available in the reserve. This regulation may place 

7 limits on the number of allowances a small business 

8 refiner may purchase from the reserve. 

9 ‘‘(6) UNSOLD ALLOWANCES.—Vintage year al10 lowances not sold from the reserve on or before Janu11 ary 15 of the calendar year following the vintage year 

12 shall be sold at an auction conducted pursuant to this 

13 section no later than March 31 of the calendar year 

14 following the vintage year. If significantly more al15 lowances are being placed in the reserve than are 

16 being purchased from the reserve several years in a 

17 row, the Administrator may adjust either the percent 

18 of allowances placed in the reserve or the date by 

19 which allowances may be purchased from the reserve. 

20 ‘‘SEC. 779. AUCTIONING ALLOWANCES FOR OTHER ENTI21 TIES. 

22 ‘‘(a) CONSIGNMENT.—Any entity holding emission al23 lowances or compensatory allowances may request that the 

24 Administrator auction, pursuant to section 778, the allow25 ances on consignment. 


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1 ‘‘(b) PRICING.—When the Administrator acts under 

2 this section as the agent of an entity in possession of emis3 sion allowances, the Administrator is not obligated to ob4 tain the highest price possible for the emission allowances, 

5 and instead shall auction consignment allowances in the 

6 same manner and pursuant to the same rules as auctions 

7 of other allowances under section 778. The Administrator 

8 may permit the entity offering the allowance for sale to con9 dition the sale of its allowances pursuant to this section 

10 on a minimum reserve price that is different than the re11 serve auction price set pursuant to section 778(d). 

12 ‘‘(c) PROCEEDS.—For emission allowances and com13 pensatory allowances auctioned pursuant to this section, 

14 notwithstanding section 3302 of title 31, United States 

15 Code, or any other provision of law, within 90 days of re16 ceipt, the United States shall transfer the proceeds from the 

17 auction to the entity which held the allowances auctioned. 

18 No funds transferred from a purchaser to a seller of emis19 sion allowances or compensatory allowances under this sub20 section shall be held by any officer or employee of the United 

21 States or treated for any purpose as public monies. 

22 ‘‘(d) REGULATIONS.—The Administrator shall issue 

23 regulations within 24 months after the date of enactment 

24 of this title to implement this section. 


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1 ‘‘SEC. 780. COMMERCIAL DEPLOYMENT OF CARBON CAP2 TURE AND PERMANENT SEQUESTRATION 

3 TECHNOLOGIES. 

4 ‘‘(a) DEFINITIONS.—In this section: 

5 ‘‘(1) CARBON CAPTURE AND PERMANENT SE6 QUESTRATION.—The term ‘carbon capture and per7 manent sequestration’ shall— 

8 ‘‘(A) have such meaning as the Adminis9 trator shall determine by regulation; and 

10 ‘‘(B) include— 

11 ‘‘(i) permanent geological sequestra12 tion; and 

13 ‘‘(ii) conversion of captured carbon di14 oxide to a stable form that will safely and 

15 permanently sequester the carbon dioxide. 

16 ‘‘(2) ENHANCED HYDROCARBON RECOVERY.— 

17 ‘‘(A) IN GENERAL.—The term ‘enhanced hy18 drocarbon recovery’ means a process by which 

19 oil, methane, or other natural gases are recovered 

20 by the injection of carbon dioxide into a geologic 

21 formation. 

22 ‘‘(B) EXCLUSION.—The term ‘enhanced hy23 drocarbon recovery’ does not include the in situ 

24 generation of a new hydrocarbon. 


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1 ‘‘(3) QUALIFYING ELECTRIC GENERATING

2 UNIT.—The term ‘qualifying electric generating unit’ 

3 means an electric utility unit— 

4 ‘‘(A) that derives at least 50 percent of the 

5 annual fuel input of the unit from— 

6 ‘‘(i) coal or waste coal; 

7 ‘‘(ii) petroleum coke; or 

8 ‘‘(iii) any combination of those 2 fuels; 

9 and 

10 ‘‘(B)(i) that has a nameplate capacity of 

11 200 megawatts or more; or 

12 ‘‘(ii) in the case of retrofit applications, the 

13 carbon capture and permanent sequestration 

14 technology of which is applied to the flue gas or 

15 fuel gas stream from at least 200 megawatts of 

16 the total nameplate generating capacity of the 

17 unit. 

18 ‘‘(4) QUALIFYING INDUSTRIAL SOURCE.—The 

19 term ‘qualifying industrial source’ means a source 

20 that— 

21 ‘‘(A) is not a qualifying electric generating 

22 unit; 

23 ‘‘(B) absent carbon capture and permanent 

24 sequestration, would emit greater than 50,000 

25 tons per year of carbon dioxide; and 


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1 ‘‘(C) does not produce a liquid transpor2 tation fuel from a solid fossil-based feedstock. 

3 ‘‘(5) TREATED GENERATING CAPACITY.— 

4 ‘‘(A) IN GENERAL.—The term ‘treated gen5 erating capacity’ means the portion of the total 

6 generating capacity of an electric generating 

7 unit (or industrial source, measured by such 

8 method as the Administrator may designate to be 

9 equivalent to the calculation under subparagraph 

10 (B)) for which the flue gas or fuel gas is treated 

11 by the carbon capture and permanent sequestra12 tion technology. 

13 ‘‘(B) CALCULATION.—In determining the 

14 treated portion of flue gas or fuel gas of an elec15 tric generating unit under subparagraph (A), the 

16 Administrator shall multiply the nameplate ca17 pacity of the unit by the ratio that— 

18 ‘‘(i) the mass of flue gas or fuel gas 

19 that is treated by the carbon capture and 

20 permanent sequestration technology; bears 

21 to 

22 ‘‘(ii) the total mass of the flue gas or 

23 fuel gas that is produced when the unit is 

24 operating at maximum capacity. 


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1 ‘‘(b) REGULATIONS.—Not later than 2 years after the 

2 date of enactment of this title, the Administrator shall pro3 mulgate regulations providing for the distribution of emis4 sion allowances allocated under section 771(a)(6), pursuant 

5 to the requirements of this section, to support the commer6 cial deployment of carbon capture and permanent seques7 tration technologies in electric power generation and indus8 trial operations. 

9 ‘‘(c) ELIGIBILITY CRITERIA AND METHOD OF DIS10 TRIBUTION.— 

11 ‘‘(1) ELIGIBILITY.—For an owner or operator of 

12 a project to be eligible to receive emission allowances 

13 under this section, the project shall— 

14 ‘‘(A) implement carbon capture and perma15 nent sequestration technology— 

16 ‘‘(i) at a qualifying electric generating 

17 unit that, upon implementation of the car18 bon capture and permanent sequestration 

19 technology, will achieve an emission limita20 tion that is at least a 50-percent reduction 

21 in emissions of the carbon dioxide produced 

22 by— 

23 ‘‘(I) the unit, measured on an an24 nual basis, as determined by the Ad25 ministrator; or 


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1 ‘‘(II) in the case of retrofit appli2 cations described in subsection 

3 (a)(2)(B)(ii), the treated portion of flue 

4 gas from the unit, measured on an an5 nual basis, as determined by the Ad6 ministrator; or 

7 ‘‘(ii) at a qualifying industrial source 

8 that, upon implementation, will achieve an 

9 emission limitation that is at least a 50- 

10 percent reduction in emissions of the carbon 

11 dioxide produced by the emission point, 

12 measured on an annual basis, as deter13 mined by the Administrator; 

14 ‘‘(B)(i) geologically sequester carbon dioxide 

15 at a site that meets all applicable permitting 

16 and certification requirements for permanent ge17 ological sequestration; or 

18 ‘‘(ii) pursuant to such requirements as the 

19 Administrator may prescribe by regulation, con20 vert captured carbon dioxide to a stable form 

21 that will safely and permanently sequester the 

22 carbon dioxide; 

23 ‘‘(C) meet all other applicable State, tribal, 

24 and Federal permitting requirements; and 

25 ‘‘(D) be located in the United States. 


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1 ‘‘(2) METHOD OF DISTRIBUTION.— 

2 ‘‘(A) PERIOD.—The Administrator shall 

3 distribute emission allowances allocated under 

4 section 771(a)(6) to eligible projects for each of 

5 the first 10 calendar years for which each eligible 

6 project is in commercial operation. 

7 ‘‘(B) BONUS ALLOWANCE FORMULA FOR

8 ELECTRIC GENERATING UNITS.— 

9 ‘‘(i) PHASE I DISTRIBUTION.—For 

10 each project that is certified under sub11 section (h), the quantity of emission allow12 ances that the Administrator shall dis13 tribute for a calendar year to the owner or 

14 operator of the eligible project shall be equal 

15 to the quotient obtained by dividing— 

16 ‘‘(I) the product obtained by mul17 tiplying— 

18 ‘‘(aa) the number of metric 

19 tons of carbon dioxide emissions 

20 avoided through carbon capture 

21 and permanent sequestration of 

22 emissions by the project for a par23 ticular year, as determined pursu24 ant to such methodology as the 


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1 Administrator shall prescribe by 

2 regulation; and 

3 ‘‘(bb) a bonus allowance 

4 value that is assigned to the 

5 project under subsection (d)(2); by 

6 ‘‘(II) the average fair market 

7 value of an emission allowance during 

8 the calendar year preceding the earlier 

9 of— 

10 ‘‘(aa) the year during which 

11 the project captured and seques12 tered the carbon dioxide emis13 sions; or 

14 ‘‘(bb) the year in which the 

15 project receives an advanced dis16 tribution of emission allowances 

17 under subsection (h)(3)(B). 

18 ‘‘(ii) PHASE II DISTRIBUTION.—For 

19 each project that qualifies under subsection 

20 (e), the quantity of emission allowances that 

21 the Administrator shall distribute for a cal22 endar year to the owner or operator of the 

23 eligible project shall be determined 

24 through— 


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1 ‘‘(I) reverse auction, as prescribed 

2 by regulation under subsection (e)(3); 

3 or 

4 ‘‘(II) if the Administrator decides 

5 not to distribute allowances through a 

6 reverse auction, an alternate distribu7 tion method established by regulation 

8 under subsection (e)(4). 

9 ‘‘(C) FORMULA FOR INDUSTRIAL

10 SOURCES.—For each project that qualifies under 

11 subsection (g), the quantity of emission allow12 ances that the Administrator shall distribute for 

13 a calendar year to the owner or operator of the 

14 eligible project shall be determined in accordance 

15 with subsection (g)(2). 

16 ‘‘(D) CONSISTENCY.—The Administrator 

17 shall develop a method of distribution for each 

18 category of eligible projects under this paragraph 

19 in a manner that is consistent with the certifi20 cation and distribution requirements under sub21 section (h). 

22 ‘‘(d) PHASE I DISTRIBUTION TO ELECTRIC GENER23 ATING UNITS.— 

24 ‘‘(1) APPLICABILITY.— 


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1 ‘‘(A) IN GENERAL.—Subject to subpara2 graph (B), this subsection shall apply to projects 

3 that are undertaken at qualifying electric gener4 ating units that the Administrator determines to 

5 be eligible to receive emission allowances under 

6 this section. 

7 ‘‘(B) CAPACITY.—The total cumulative gen8 erating capacity of the projects described in sub9 paragraph (A) shall be equal to approximately 

10 20 gigawatts of the treated generating capacity. 

11 ‘‘(2) BONUS ALLOWANCE VALUES.— 

12 ‘‘(A) FIRST TRANCHE.— 

13 ‘‘(i) IN GENERAL.—The first tranche 

14 shall include the first 10 gigawatts of treat15 ed generating capacity undertaken at quali16 fying electric generating units that receive 

17 emission allowances under this section. 

18 ‘‘(ii) CERTAIN UNITS.—For an eligible 

19 project achieving carbon capture and per20 manent sequestration of 90 percent or more 

21 of the carbon dioxide that otherwise would 

22 be emitted by the unit, the bonus allowance 

23 value shall be $96 per ton of carbon dioxide 

24 emissions avoided through the use of carbon 

25 capture and permanent sequestration. 


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1 ‘‘(iii) BONUS ALLOWANCE VALUE.—The 

2 Administrator shall establish, by regulation, 

3 a bonus allowance value for each rate of 

4 carbon capture and permanent sequestra5 tion achieved by an eligible project— 

6 ‘‘(I) beginning at a minimum of 

7 $50 per ton for a 50-percent rate; and 

8 ‘‘(II) varying in direct proportion 

9 with increasing rates of carbon capture 

10 and permanent sequestration up to $96 

11 per ton for an 90-percent rate. 

12 ‘‘(B) SECOND TRANCHE.— 

13 ‘‘(i) IN GENERAL.—The second tranche 

14 shall include the second 10 gigawatts of 

15 treated generating capacity undertaken at 

16 qualifying electric generating units that re17 ceive emission allowances under this section. 

18 ‘‘(ii) CERTAIN UNITS.—For an eligible 

19 project achieving the carbon capture and 

20 permanent sequestration of 90 percent or 

21 more of the carbon dioxide that otherwise 

22 would be emitted by the eligible project, the 

23 bonus allowance value shall be $85 per ton 

24 of carbon dioxide emissions avoided through 


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1 the use of capture and permanent sequestra2 tion. 

3 ‘‘(iii) BONUS ALLOWANCE VALUE.—The 

4 Administrator shall establish, by regulation, 

5 a bonus allowance value for each rate of 

6 carbon capture and permanent sequestra7 tion achieved by an eligible project— 

8 ‘‘(I) beginning at a minimum of 

9 $50 per ton for a 50-percent rate; and 

10 ‘‘(II) varying in direct proportion 

11 with increasing rates of carbon capture 

12 and permanent sequestration up to $85 

13 per ton for a 90-percent rate. 

14 ‘‘(C) INCREASE IN BONUS ALLOWANCE

15 VALUE.—For an eligible project that commences 

16 commercial operation by not later than January 

17 1, 2017, and that meets the eligibility criteria 

18 under subsection (c), the otherwise-applicable 

19 bonus allowance value under this paragraph 

20 shall be increased by $10, if the owner or oper21 ator of the eligible project submits to the Admin22 istrator by not later than January 1, 2012, a 

23 notification of the intent to implement carbon 

24 capture and permanent sequestration technology 


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1 at a qualifying electric generating unit in ac2 cordance with subsection (c). 

3 ‘‘(D) REDUCTION.— 

4 ‘‘(i) IN GENERAL.—For a carbon cap5 ture and permanent sequestration project 

6 sequestering in a geological formation for 

7 purposes of enhanced hydrocarbon recovery, 

8 the Administrator, by regulation, shall re9 duce the applicable bonus allowance value 

10 under this paragraph to reflect the lower net 

11 cost of the project, as compared to perma12 nent sequestration into geological forma13 tions solely for purposes of sequestration. 

14 ‘‘(ii) ASSESSMENT OF NET COST.—For 

15 the purpose of this subparagraph, an assess16 ment of net cost of a project shall account 

17 for the cost of the injection of carbon diox18 ide, or other method of enhanced hydro19 carbon recovery, that would have otherwise 

20 been undertaken in the absence of the car21 bon capture and permanent sequestration 

22 project under consideration. 

23 ‘‘(E) ADJUSTMENTS.—The Administrator 

24 shall annually adjust for monetary inflation the 


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1 bonus allowance values established under this 

2 paragraph. 

3 ‘‘(F) MEASUREMENT.—The Administrator 

4 shall measure the tranches and capture levels for 

5 assigning the bonus allowance values under this 

6 subsection based on the treated generating capac7 ity of the qualifying electric generating units 

8 and qualifying industrial sources that receive 

9 emission allowances under this subsection. 

10 ‘‘(G) AVERAGE FAIR MARKET VALUE.— 

11 ‘‘(i) IN GENERAL.—The Administrator 

12 and the Secretary of Energy may jointly 

13 determine that the average fair market 

14 value for emission allowances or the bonus 

15 allowances have been too low or too high to 

16 achieve efficient and cost-effective commer17 cial deployment of carbon capture and per18 manent sequestration technology in a given 

19 calendar year. 

20 ‘‘(ii) ACTION ON DETERMINATION.—On 

21 making a determination under clause (i), 

22 the Administrator may— 

23 ‘‘(I) promulgate regulations to ad24 just the bonus allowance value under 

25 this paragraph; or 


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1 ‘‘(II) distribute an appropriate 

2 quantity of emission allowances allo3 cated under section 771(a)(6) from any 

4 future vintage year. 

5 ‘‘(e) PHASE II DISTRIBUTION TO ELECTRIC GENER6 ATING UNITS.— 

7 ‘‘(1) APPLICATION.—This subsection shall apply 

8 only to the distribution of emission allowances for 

9 carbon capture and permanent sequestration projects 

10 undertaken at qualifying electric generating units 

11 and qualifying industrial sources after the treated 

12 generating capacity threshold identified under sub13 section (d)(1) is reached. 

14 ‘‘(2) REGULATIONS.—Not later than 2 years be15 fore the date on which the capacity threshold identi16 fied in subsection (d)(1) is projected to be reached, the 

17 Administrator shall promulgate regulations to govern 

18 the distribution of emission allowances to the owners 

19 or operators of eligible projects under this subsection. 

20 ‘‘(3) REVERSE AUCTIONS.— 

21 ‘‘(A) IN GENERAL.—Except as provided in 

22 paragraph (4), the regulations promulgated pur23 suant to paragraph (2) shall provide for the dis24 tribution of emission allowances to the owners or 

25 operators of eligible projects under this subVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01555 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 section through at least 2 reverse auctions, each 

2 of which shall be held not less frequently than 

3 once each calendar year. 

4 ‘‘(B) REQUIREMENTS.— 

5 ‘‘(i) PROJECTS AT INDUSTRIAL

6 SOURCES.—The Administrator shall annu7 ally establish a reverse auction for projects 

8 at industrial sources, which may not par9 ticipate in other auctions. 

10 ‘‘(ii) OTHER AUCTIONS.—The Admin11 istrator may establish a separate auction 

12 for each of not more than 5 different project 

13 categories, as defined based on— 

14 ‘‘(I) coal type; 

15 ‘‘(II) capture technology; 

16 ‘‘(III) geological formation type; 

17 ‘‘(IV) new unit versus retrofit ap18 plication; 

19 ‘‘(V) such other factors as the Ad20 ministrator may prescribe; or 

21 ‘‘(VI) any combination of the fac22 tors described in subclauses (I) through 

23 (V). 

24 ‘‘(iii) EFFICIENT DISTRIBUTION.—The 

25 Administrator shall establish procedures for 


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1 the auction of emission allowances under 

2 this subparagraph to ensure that the estab3 lishment of separate auctions for different 

4 project categories will not unduly impede 

5 the efficient and expeditious distribution of 

6 emission allowances to eligible projects 

7 under this subsection. 

8 ‘‘(iv) MINIMUM RATES.—The Adminis9 trator may establish appropriate minimum 

10 rates of carbon capture and permanent se11 questration for the treated generating capac12 ity of a project in implementing this sub13 paragraph. 

14 ‘‘(C) AUCTION PROCESS.—At each reverse 

15 auction under this paragraph— 

16 ‘‘(i) the Administrator shall solicit bids 

17 from eligible projects; 

18 ‘‘(ii) owners or operators of eligible 

19 projects participating in the auction shall 

20 submit a bid, including the desired level of 

21 carbon dioxide permanent sequestration in22 centive per ton and the estimated quantity 

23 of carbon dioxide that the project will per24 manently sequester during a 10-year period; 

25 and 


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1 ‘‘(iii) the Administrator shall select 

2 bids within each auction for the permanent 

3 sequestration quantity submitted, beginning 

4 with the eligible project for which the bid is 

5 submitted for the lowest level of permanent 

6 sequestration incentive on a per-ton basis 

7 and meeting such other requirements as the 

8 Administrator may specify, until the 

9 amounts available for the reverse auction 

10 are committed. 

11 ‘‘(D) FORM OF DISTRIBUTION.—The Ad12 ministrator shall distribute emission allowances 

13 to the owners or operators of eligible projects se14 lected through a reverse auction under this para15 graph pursuant to a formula equivalent to the 

16 formula contained in subsection (c)(2)(B), except 

17 that the bonus allowance value that is bid by the 

18 applicable entity shall be substituted for the 

19 bonus allowance values described in subsection 

20 (c)(2). 

21 ‘‘(4) ALTERNATIVE DISTRIBUTION METHOD.— 

22 ‘‘(A) IN GENERAL.—If the Administrator 

23 determines that a reverse auction will not result 

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1 tration technologies, the Administrator, pursuant 

2 to regulations under paragraph (2) or (5), shall 

3 prescribe a schedule for the provision of bonus al4 lowances to the owners or operators of eligible 

5 projects under this subsection, in accordance 

6 with the requirements of this paragraph. 

7 ‘‘(B) MULTIPLE TRANCHES.—The Adminis8 trator shall divide emission allowances available 

9 for distribution to the owners or operators of eli10 gible projects into a series of tranches, each of 

11 which— 

12 ‘‘(i) shall support the deployment of a 

13 specified quantity of cumulative electric 

14 generating capacity using carbon capture 

15 and permanent sequestration technology; 

16 and 

17 ‘‘(ii) shall not be greater than 10 

18 gigawatts of treated generating capacity. 

19 ‘‘(C) METHOD OF DISTRIBUTION.—The Ad20 ministrator shall distribute emission allowances 

21 within each tranche, on a first-come, first-served 

22 basis— 

23 ‘‘(i) based on the date of full-scale op24 eration of carbon capture and permanent 

25 sequestration technology; and 


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1 ‘‘(ii) pursuant to a formula that— 

2 ‘‘(I) is similar to the formula con3 tained in subsection (c)(2)(C), except 

4 that the Administrator may prescribe 

5 bonus allowance values different than 

6 those described in subsection (c)(2) 

7 based on the criteria established under 

8 subparagraph (E); and 

9 ‘‘(II) establishes the number of 

10 emission allowances to be distributed 

11 per ton of carbon dioxide sequestered 

12 by the project. 

13 ‘‘(D) REQUIREMENTS.—For each tranche 

14 established pursuant to subparagraph (B), the 

15 Administrator shall establish a schedule for dis16 tributing emission allowances that— 

17 ‘‘(i) is based on a sliding scale that 

18 provides higher bonus allowance values for 

19 projects achieving higher rates of carbon 

20 capture and permanent sequestration for the 

21 treated generation capacity at the unit; 

22 ‘‘(ii) for each carbon capture and per23 manent sequestration rate, establishes a 

24 bonus allowance value that is lower than 

25 that established for the applicable rate for 


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1 the previous tranche (or, in the case of the 

2 first tranche, than that established for the 

3 applicable rate under subsection (d)(2)); 

4 and 

5 ‘‘(iii) may establish different bonus al6 lowance levels for not more than 5 different 

7 project categories, as defined based on— 

8 ‘‘(I) coal type; 

9 ‘‘(II) capture and transportation 

10 technology; 

11 ‘‘(III) geological formation type; 

12 ‘‘(IV) new unit versus retrofit ap13 plication; 

14 ‘‘(V) such other factors as the Ad15 ministrator may prescribe; or 

16 ‘‘(VI) any combination of the fac17 tors described in subclauses (I) through 

18 (V). 

19 ‘‘(E) CRITERIA FOR ESTABLISHING BONUS

20 ALLOWANCE VALUES.—In establishing bonus al21 lowance values under this paragraph, the Ad22 ministrator shall seek to cover not more than the 

23 reasonable incremental capital and operating 

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1 questration technologies and carbon transpor2 tation technologies, taking into account— 

3 ‘‘(i) the reduced cost of compliance 

4 with section 722; 

5 ‘‘(ii) the reduced cost associated with 

6 sequestering in a geological formation for 

7 purposes of enhanced hydrocarbon recovery, 

8 as compared to permanent sequestration 

9 into geological formations solely for pur10 poses of sequestration; 

11 ‘‘(iii) the relevant factors defining the 

12 project category; and 

13 ‘‘(iv) such other factors as the Admin14 istrator determines to be appropriate. 

15 ‘‘(5) REVISION OF REGULATIONS.—The Adminis16 trator shall review and, as appropriate, revise the ap17 plicable regulations under this subsection not less fre18 quently than once every 8 years. 

19 ‘‘(f) LIMITS FOR CERTAIN ELECTRIC GENERATING

20 UNITS.— 

21 ‘‘(1) DEFINITIONS.—In this subsection, the terms 

22 ‘covered EGU’ and ‘initially permitted’ have the 

23 meanings given those terms in section 812. 

24 ‘‘(2) COVERED EGUS INITIALLY PERMITTED

25 FROM 2009 THROUGH 2014.—For a covered EGU that 


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1 is initially permitted during the period beginning on 

2 January 1, 2009, and ending on December 31, 2014, 

3 the Administrator shall reduce the quantity of emis4 sion allowances that the owner or operator of the cov5 ered EGU would otherwise be eligible to receive under 

6 this section as follows: 

7 ‘‘(A) In the case of a covered EGU com8 mencing operation on or before January 1, 2019, 

9 if the date in clause (ii)(I) is earlier than the 

10 date in clause (ii)(II), by the product obtained 

11 by multiplying— 

12 ‘‘(i) 20 percent; and 

13 ‘‘(ii) the number of years, if any, that 

14 have elapsed between— 

15 ‘‘(I) the earlier of— 

16 ‘‘(aa) January 1, 2020; and 

17 ‘‘(bb) the date that is 5 years 

18 after the commencement of oper19 ation of the covered EGU; and 

20 ‘‘(II) the first year that the cov21 ered EGU achieves (and thereafter 

22 maintains) an emission limitation 

23 that is at least a 50-percent reduction 

24 in emissions of carbon dioxide pro25 duced by the unit, measured on an anVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01563 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 nual basis, as determined in accord2 ance with section 812(b)(2). 

3 ‘‘(B) In the case of a covered EGU com4 mencing operation after January 1, 2019, by the 

5 product obtained by multiplying— 

6 ‘‘(i) 20 percent; and 

7 ‘‘(ii) the number of years, if any, that 

8 have elapsed between— 

9 ‘‘(I) the commencement of oper10 ation of the covered EGU; and 

11 ‘‘(II) the first year that the cov12 ered EGU achieves (and thereafter 

13 maintains) an emission limitation 

14 that is at least a 50-percent reduction 

15 in emissions of carbon dioxide pro16 duced by the unit, measured on an an17 nual basis, as determined in accord18 ance with section 812(b)(2). 

19 ‘‘(3) COVERED EGUS INITIALLY PERMITTED

20 FROM 2015 THROUGH 2019.—The owner or operator of 

21 a covered EGU that is initially permitted during the 

22 period beginning on January 1, 2015, and ending on 

23 December 31, 2019, shall be ineligible to receive emis24 sion allowances under this section if the covered EGU, 

25 on commencement of operations (and thereafter), does 


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1 not achieve and maintain an emission limitation that 

2 is at least a 50-percent reduction in emissions of car3 bon dioxide produced by the covered EGU, measured 

4 on an annual basis, as determined in accordance with 

5 section 812(b)(2). 

6 ‘‘(4) EGUS RECEIVING ADVANCED DISTRIBU7 TION.— 

8 ‘‘(A) IN GENERAL.—For an EGU that re9 ceives an advanced distribution of emission al10 lowances, the Administrator shall reduce and re11 cover, as applicable, the quantity of emission al12 lowances that the owner or operator of the EGU 

13 has received and remains eligible to receive 

14 under this section, which shall be equal to the 

15 product obtained by multiplying— 

16 ‘‘(i) 20 percent; and 

17 ‘‘(ii) the number of years, if any, that 

18 have elapsed between— 

19 ‘‘(I) the date that is 18 months 

20 after— 

21 ‘‘(aa) in the case of an EGU 

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1 mencement of operation of the 

2 EGU; or 

3 ‘‘(bb) in the case of an EGU 

4 that was initially permitted prior 

5 to January 1, 2009, the date that 

6 is 3 years after the date on which 

7 the project owner receives an ad8 vanced distribution for that EGU 

9 under subsection (h)(3)(B); and 

10 ‘‘(II) the first year that the EGU 

11 achieves (and thereafter maintains) an 

12 emission limitation that is at least a 

13 50-percent reduction in emissions of 

14 carbon dioxide produced by the EGU, 

15 measured on an annual basis. 

16 ‘‘(B) EXTENSION.— 

17 ‘‘(i) IN GENERAL.—If an owner or op18 erator of an EGU that receives an advanced 

19 distribution of emission allowances deter20 mines that the owner or operator will not be 

21 able to achieve at least a 50-percent reduc22 tion in emissions of carbon dioxide pro23 duced by the EGU, as measured on an an24 nual basis, by the date specified in subpara25 graph (A)(ii)(I), the owner or operator may 


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1 petition the Administrator to extend that 

2 date by not more than 18 months. 

3 ‘‘(ii) TIME OF SUBMISSION OF PETI4 TION.—The owner or operator shall submit 

5 a petition described in clause (i) to the Ad6 ministrator as soon as practicable after the 

7 date on which the basis for the petition 

8 arises. 

9 ‘‘(iii) CONDITIONS FOR EXTENSION.— 

10 The Administrator shall prescribe, by regu11 lation, the conditions under which an exten12 sion under clause (i) may be granted, in13 cluding— 

14 ‘‘(I) an inability of an EGU to 

15 sequester at the site, despite due dili16 gence having been undertaken; and 

17 ‘‘(II) legal challenges to the imple18 mentation of the carbon capture and 

19 permanent sequestration technology. 

20 ‘‘(g) INDUSTRIAL SOURCES.— 

21 ‘‘(1) EMISSION ALLOWANCES.—The Adminis22 trator— 

23 ‘‘(A) may distribute not more than 15 per24 cent of the emission allowances allocated under 

25 section 771(a)(6) for any vintage year to the 


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1 owners or operators of eligible industrial sources 

2 to support the commercial-scale deployment of 

3 carbon capture and permanent sequestration 

4 technologies at those sources; and 

5 ‘‘(B) notwithstanding any other provision 

6 of law— 

7 ‘‘(i) may distribute to eligible indus8 trial sources not more than 15 percent of 

9 the emission allowances allocated under sec10 tion 771(a)(6) for any vintage year in the 

11 second tranche of phase I; but 

12 ‘‘(ii) may not distribute those allow13 ances for any vintage year in the first 

14 tranche of phase I. 

15 ‘‘(2) DISTRIBUTION.— 

16 ‘‘(A) IN GENERAL.—The Administrator 

17 shall prescribe, by regulation, requirements for 

18 the distribution of emission allowances to the 

19 owners or operators of industrial sources under 

20 this subsection, based on a bonus allowance for21 mula that awards emission allowances to quali22 fying projects on the basis of tons of carbon diox23 ide captured and permanently sequestered. 


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1 ‘‘(B) METHOD.—The Administrator may 

2 provide for the distribution of emission allow3 ances pursuant to— 

4 ‘‘(i) a reverse auction method similar 

5 to the method described in subsection (e)(3), 

6 including the use of separate auctions for 

7 different project categories; or 

8 ‘‘(ii) an incentive schedule similar to 

9 the schedule described in subsection (e)(4), 

10 which shall ensure that incentives are estab11 lished so as to satisfy the requirement de12 scribed in subsection (e)(4)(E). 

13 ‘‘(3) REVISION OF REGULATIONS.—The Adminis14 trator shall review and, as appropriate, revise the 

15 regulations under this subsection not less frequently 

16 than once every 8 years. 

17 ‘‘(h) CERTIFICATION AND DISTRIBUTION.— 

18 ‘‘(1) CERTIFICATION.— 

19 ‘‘(A) REQUEST.— 

20 ‘‘(i) PHASE I; ALTERNATIVE DISTRIBU21 TION METHOD.—In the case of a qualifying 

22 project that is eligible to receive allowances 

23 under phase I or under subsection (e)(4), at 

24 any time prior to placing a carbon capture 

25 and permanent sequestration project into 


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1 commercial operation, the owner or oper2 ator of the planned project may request 

3 from the Administrator a certification that 

4 the project is eligible to receive emission al5 lowances under this section. 

6 ‘‘(ii) REVERSE AUCTIONS.—In the case 

7 of a qualifying project that wins a reverse 

8 auction under subsection (e) or (g), within 

9 a reasonably brief period following comple10 tion of the auction (as specified by the Ad11 ministrator), the owner or operator of the 

12 qualifying project shall request from the Ad13 ministrator a certification that the project 

14 is eligible to receive emission allowances 

15 under this section. 

16 ‘‘(iii) ELIGIBLE PROJECTS.—Eligible 

17 projects in phase I and phase II may re18 ceive certification under this paragraph. 

19 ‘‘(iv) ISSUANCE.—Not later than 90 

20 days after the date on which the Adminis21 trator determines that the owner or operator 

22 of the planned project has submitted com23 plete documentation pursuant to subpara24 graph (B), the Administrator shall issue a 


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1 certification described in this subpara2 graph— 

3 ‘‘(I) if the owner or operator dem4 onstrates a commitment to construct 

5 and operate a project that satisfies— 

6 ‘‘(aa) the eligibility criteria 

7 of subsection (c); and 

8 ‘‘(bb) the requirements of this 

9 paragraph; and 

10 ‘‘(II) that is based on the consid11 eration by the Administrator of the 

12 documentation submitted pursuant to 

13 subparagraph (B), as well as other rel14 evant information, as determined by 

15 the Administrator, in consultation 

16 with the owner or operator. 

17 ‘‘(B) DOCUMENTATION.— 

18 ‘‘(i) IN GENERAL.—The Administrator 

19 shall prescribe, by regulation, the docu20 mentation necessary for making a deter21 mination of project eligibility for the certifi22 cation under subparagraph (A), includ23 ing— 

24 ‘‘(I) in the case of a planned 

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1 tion of emission allowances, a commit2 ment to implement carbon and perma3 nent sequestration technology upon 

4 commencement of operation, to meet 

5 the eligibility requirements of (c)(1) by 

6 not later than 18 months after the date 

7 of commencement of operation; 

8 ‘‘(II) technical information re9 garding the carbon capture and per10 manent sequestration technology, coal 

11 type, geological formation type (if ap12 plicable), and other relevant design fea13 tures that are planned for the project; 

14 ‘‘(III) the annual reductions in 

15 carbon dioxide emissions that the car16 bon capture and permanent sequestra17 tion technology is projected to achieve 

18 during each of the first 10 years that 

19 the project achieves commercial oper20 ation; 

21 ‘‘(IV) a demonstration that the 

22 owner or operator is committed to both 

23 constructing and operating the 

24 planned project on a timeline marked 

25 by reasonable milestones, through the 


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1 completion of 1 of the actions specified 

2 in subparagraph (C)(iii); 

3 ‘‘(V) the amount of Federal fund4 ing the project owner has received, if 

5 any, to cover the costs of constructing 

6 a project that is eligible under this 

7 paragraph; and 

8 ‘‘(VI) an assessment of the costs of 

9 constructing the project, which shall 

10 serve as a basis for the determination 

11 of the Administrator regarding ad12 vanced distributions under paragraph 

13 (3)(C). 

14 ‘‘(ii) NONRETROFIT APPLICATION.—In 

15 the case of a project that is not a retrofit 

16 application, the assessment of costs de17 scribed in clause (i)(VI) shall include an as18 sessment of the costs of constructing the elec19 tric generating unit or industrial source 

20 that will produce the flue gas or fuel gas to 

21 be treated by the carbon capture and per22 manent sequestration technology. 

23 ‘‘(C) COMMITMENT.— 

24 ‘‘(i) IN GENERAL.—Subject to clause 

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1 fying actions specified under clause (iii) 

2 shall constitute a commitment to construct 

3 and operate a planned carbon capture and 

4 permanent sequestration project. 

5 ‘‘(ii) CONDITION.—In the case of a 

6 qualifying action specified in subclause (I) 

7 or (II) of clause (iii), the completion of such 

8 an action may be subject to a condition that 

9 the Administrator will issue a certification 

10 under this paragraph for the distribution of 

11 emission allowances to the project. 

12 ‘‘(iii) QUALIFYING ACTIONS.—Quali13 fying actions under this subparagraph shall 

14 include— 

15 ‘‘(I) the execution of— 

16 ‘‘(aa) a commitment by lend17 ers or other appropriate entities 

18 to finance the project, which may 

19 be subject to customary closing 

20 conditions that are associated 

21 with the execution of the commit22 ment; 

23 ‘‘(bb) an authorization by a 

24 State regulatory authority to 

25 allow recovery, from the retail 


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1 customers of such electric utility, 

2 of the costs of the project by a 

3 State-regulated electric utility 

4 that plans to construct the project; 

5 or 

6 ‘‘(cc) an authorization by a 

7 State legislature to allow recovery, 

8 from the retail customers of elec9 tric utilities that are required to 

10 purchase some or all of the elec11 tricity from the project pursuant 

12 to State law, of the costs of the 

13 project, on the conditions that the 

14 project has been approved by the 

15 legislature and, under State law, 

16 retail electric providers are re17 quired collectively to purchase all 

18 of the net electric output from the 

19 project; and 

20 ‘‘(II) a commitment by the owner 

21 or operator of the project to execute a 

22 surety bond in sufficient amounts by 

23 not later than 2 years after the date on 

24 which the Administrator issues the cer25 tification for the project. 


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1 ‘‘(D) CONTENT OF CERTIFICATION.—The 

2 Administrator shall prescribe, by regulation, the 

3 required content of each certification issued 

4 under this paragraph, including— 

5 ‘‘(i) the annual reductions in carbon 

6 dioxide emissions that the carbon capture 

7 and sequestration technology the owner or 

8 operator of the planned project commits to 

9 achieve during each of the first 10 years 

10 that the project is in commercial operation, 

11 as specified in section 812; 

12 ‘‘(ii) the construction and operating 

13 milestones to which the owner or operator of 

14 the planned project commits; 

15 ‘‘(iii) a certification that the docu16 mentation submitted under subparagraph 

17 (B) is true and accurate; 

18 ‘‘(iv) for those sources that have re19 ceived advanced distribution of emission al20 lowances under paragraph (3)(B), the re21 payment periods that the Administrator has 

22 specified pursuant to paragraph (3)(D)(v) 

23 as of the effective date of the certification; 

24 and 


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1 ‘‘(v) such other requirements as may be 

2 necessary to govern the advanced distribu3 tion of emission allowances between the Ad4 ministrator and the owner or operator of 

5 the planned project, subject to the require6 ments of this subsection. 

7 ‘‘(E) FAILURE TO REQUEST CERTIFI8 CATION.— 

9 ‘‘(i) IN GENERAL.—An owner or oper10 ator may elect not to request a certification 

11 on the eligibility of a planned project under 

12 subparagraph (A) prior to the commercial 

13 operation of the project. 

14 ‘‘(ii) DETERMINATION BY ADMINIS15 TRATOR.—If an owner or operator elects not 

16 to request a certification under clause (i), 

17 the Administrator shall make a determina18 tion regarding whether the project satisfies 

19 the eligibility requirements of subsection (c) 

20 at the time that the Administrator makes a 

21 determination regarding the annual dis22 tribution of emission allowances under 

23 paragraph (3)(A). 

24 ‘‘(2) RESERVATION OF EMISSION ALLOWANCES.— 

25 ‘‘(A) AMOUNT.— 


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1 ‘‘(i) IN GENERAL.—For each project 

2 that receives a certification of eligibility 

3 under paragraph (1), the Administrator 

4 shall reserve on a first-come, first-served 

5 basis a portion of the emission allowances 

6 that are allocated for the deployment of car7 bon capture and permanent sequestration 

8 technology under section 771(a)(6). 

9 ‘‘(ii) DETERMINATION.—The reserva10 tion of emission allowances for a particular 

11 eligible project under this paragraph shall 

12 be equal to the number of emission allow13 ances that the project would be entitled to 

14 receive under the applicable distribution 

15 method under this section upon commercial 

16 operation of the carbon capture and perma17 nent sequestration technology, as determined 

18 by the Administrator based on— 

19 ‘‘(I) the applicable bonus allow20 ance value; 

21 ‘‘(II) the number of tons of carbon 

22 dioxide emissions projected to be avoid23 ed through the use of carbon capture 

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1 nologies during each calendar year 

2 under paragraph (1)(B)(i)(II); and 

3 ‘‘(III) a discount rate to account 

4 for the increase in the monetary infla5 tion that may be expected to occur dur6 ing each of the relevant 10 calendar 

7 years, as determined by the Adminis8 trator. 

9 ‘‘(B) TERMINATION OF RESERVATION.— 

10 ‘‘(i) IN GENERAL.—A reservation of 

11 emission allowances for a particular project 

12 under subparagraph (A) shall terminate if 

13 the Administrator determines that the 

14 owner or operator has failed to achieve a 

15 reasonable number of milestones for com16 mencing construction or commercial oper17 ation of the project, as specified under para18 graph (1)(B)(i)(III). 

19 ‘‘(ii) REDUCED QUANTITY OF CARBON

20 DIOXIDE CAPTURED AND SEQUESTERED.—If 

21 the quantity of carbon dioxide emissions 

22 avoided through the operation of the carbon 

23 capture and permanent sequestration 

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1 fied for those calendar years under subpara2 graph (A), the reservation of emission al3 lowances for the project under subparagraph 

4 (A) shall be reduced in future years by the 

5 difference between— 

6 ‘‘(I) the quantity of carbon diox7 ide emissions avoided through oper8 ation of the carbon capture and per9 manent sequestration project on aver10 age over the applicable 3 consecutive 

11 years; and 

12 ‘‘(II) the quantity specified under 

13 subparagraph (A) for the applicable 

14 years. 

15 ‘‘(iii) AVAILABILITY.—The Adminis16 trator shall immediately make available to 

17 other eligible projects emission allowances 

18 for which the Administrator has terminated 

19 an emission allowance reservation for a 

20 particular project under this subparagraph. 

21 ‘‘(3) DISTRIBUTION PROCESS.— 

22 ‘‘(A) ANNUAL DISTRIBUTION.— 

23 ‘‘(i) IN GENERAL.—The Administrator 

24 shall distribute the emission allowances to 

25 eligible projects on an annual basis. 


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1 ‘‘(ii) BASIS.—The annual distribution 

2 of emission allowances shall be based on the 

3 total tons of carbon dioxide emissions avoid4 ed through operation of the carbon capture 

5 and permanent sequestration project during 

6 each of the first 10 years of commercial op7 eration, in accordance with subsection 

8 (c)(2). 

9 ‘‘(iii) TOTAL DISTRIBUTION

10 AMOUNT.—The total amount of emission al11 lowances distributed to an eligible project 

12 for each of the first 10 years of commercial 

13 operation may be greater than, or less than, 

14 the quantity of emissions allowances that 

15 the Administrator has reserved for the eligi16 ble project under paragraph (2). 

17 ‘‘(iv) REPORTS.— 

18 ‘‘(I) IN GENERAL.—Except as pro19 vided in subparagraph (B), the Ad20 ministrator shall make each annual 

21 distribution of emission allowances by 

22 not later than 90 days after the date 

23 on which the owner or operator of a 

24 project submits to the Administrator a 

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1 oxide emissions avoided for that year 

2 through operation of the carbon cap3 ture and permanent sequestration 

4 project. 

5 ‘‘(II) REQUIREMENT.—A report 

6 under subclause (I) shall be verified in 

7 accordance with regulations to be pro8 mulgated by the Administrator. 

9 ‘‘(B) ADVANCED DISTRIBUTION.— 

10 ‘‘(i) IN GENERAL.—The Administrator 

11 may provide an advanced distribution of 

12 emission allowances to the projects— 

13 ‘‘(I) that receive emission allow14 ances under the phase I distributions 

15 authorized by subsection (d); and 

16 ‘‘(II) for which the Administrator 

17 has issued a certification of eligibility 

18 under paragraph (1). 

19 ‘‘(ii) REQUIREMENTS.—An advanced 

20 distribution of emission allowances for a 

21 particular project shall be provided— 

22 ‘‘(I) prior to the operational phase 

23 of the project, at an appropriate mile24 stone that best ensures the expeditious 

25 deployment of the carbon capture and 


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1 permanent sequestration technology, as 

2 determined by the Administrator; 

3 ‘‘(II) in a quantity that equals a 

4 percentage, as specified in subpara5 graph (C), of the total number of emis6 sion allowances that the Administrator 

7 has reserved for that project during the 

8 10-year period of commercial oper9 ation; and 

10 ‘‘(III) using allowances that are 

11 drawn— 

12 ‘‘(aa) from the current vin13 tage year; or 

14 ‘‘(bb) if the allowances are 

15 exhausted from the current vin16 tage year, in order from successive 

17 vintage years, beginning with the 

18 most proximate future vintage 

19 year. 

20 ‘‘(iii) REPORTS.— 

21 ‘‘(I) IN GENERAL.—The owner or 

22 operator of a planned project that re23 ceives an advanced distribution of 

24 emission allowances shall submit to the 

25 Administrator, not later than 90 days 


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1 after the end of each calendar year, a 

2 report describing the tons of carbon di3 oxide emissions avoided for that year 

4 through operation of the carbon cap5 ture and permanent sequestration 

6 project , compared to the total tons of 

7 carbon dioxide emissions generated by 

8 the unit on which the planned project 

9 is implemented. 

10 ‘‘(II) REQUIREMENT.—A report 

11 under subclause (I) shall be verified in 

12 accordance with regulations promul13 gated by the Administrator. 

14 ‘‘(III) AVOIDANCE OF DUPLICA15 TIVE REPORTING.—If the unit on 

16 which a planned project is imple17 mented already submits the informa18 tion required by subclause (I) to the 

19 Administrator pursuant to another re20 porting requirement, the owner or op21 erator of the planned project may refer 

22 the Administrator to the other submis23 sion in which the required information 

24 is provided. 

25 ‘‘(C) PERCENTAGES.— 


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1 ‘‘(i) IN GENERAL.—Subject to clauses 

2 (ii) and (iii), the Administrator shall apply 

3 the following percentages for determining 

4 the advanced distribution of emission allow5 ances: 

6 ‘‘(I) 70 percent of the emission al7 lowance reservation for the first 

8 tranche under subsection (d)(2)(A). 

9 ‘‘(II) 50 percent of the emission 

10 allowance reservation for the second 

11 tranche under subsection (d)(2)(B). 

12 ‘‘(ii) COSTS LESS THAN VALUE OF AL13 LOWANCES.—If the costs described in clause 

14 (iii) are less than the monetary value of al15 lowances represented by the percentages de16 scribed in clause (i) at the time of advanced 

17 distribution, the advanced distribution shall 

18 be limited to an amount that is equivalent 

19 to the costs described in clause (iii). 

20 ‘‘(iii) COSTS.— 

21 ‘‘(I) IN GENERAL.—For retrofit 

22 projects, the advanced distribution 

23 shall equate to 100 percent of the costs 

24 of permitting, design or engineering, 

25 labor, materials, land, and equipment 


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1 associated with the construction and 

2 installation of the system to capture, 

3 compress, transport, and store carbon 

4 dioxide (including design changes to 

5 the associated generating unit needed 

6 to accommodate the carbon dioxide 

7 capture and compression system). 

8 ‘‘(II) NEW ELECTRIC GENERATING

9 UNITS.—For new projects— 

10 ‘‘(aa) the advanced distribu11 tion shall equate to 100 percent of 

12 the incremental permitting, design 

13 or engineering, labor, materials, 

14 land, and equipment cost dif15 ferences between— 

16 ‘‘(AA) a new coal power 

17 plant with carbon capture 

18 and storage; and 

19 ‘‘(BB) a new coal power 

20 plant without carbon capture 

21 and storage in the location 

22 where the new coal power 

23 plant is being constructed, 

24 and for the same intended 


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1 service territory absent car2 bon capture and storage; and 

3 ‘‘(bb) it shall be the responsi4 bility of the organization that is 

5 requesting advanced distributions 

6 to provide to the Administrator a 

7 cost estimate for both the new coal 

8 power plant with carbon capture 

9 and storage and a new coal power 

10 plant without carbon capture and 

11 storage. 

12 ‘‘(III) REDUCTION.—For the pur13 poses of this subparagraph, the costs 

14 under this clause shall be reduced by 

15 the amounts documented under para16 graph (1)(B)(i)(V). 

17 ‘‘(D) RECONCILIATION FOR ADVANCED PAY18 MENTS.— 

19 ‘‘(i) IN GENERAL.—In the case of a 

20 project that receives an advanced distribu21 tion of emission allowances under this 

22 paragraph, the Administrator shall dis23 tribute annually the remainder of emission 

24 allowances reserved under paragraph (2) 

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1 questration technology begins commercial 

2 operation. 

3 ‘‘(ii) TIMING OF DISTRIBUTION.—The 

4 annual distribution of emission allowances 

5 under clause (i) shall take place not later 

6 than 60 days after the end of each calendar 

7 year. 

8 ‘‘(iii) CALCULATION OF REMAINING

9 DISTRIBUTION.—Subject to clauses (iv) and 

10 (v), the remaining distribution referred to 

11 in clause (i) shall annually be calculated 

12 upward or downward as the difference be13 tween— 

14 ‘‘(I) the number of allowances that 

15 were reserved for the project in the rel16 evant calendar year under paragraph 

17 (2)(A)(ii)(II); and 

18 ‘‘(II) the number of allowances 

19 that the project would be eligible to re20 ceive under the bonus allowance for21 mula described in subsection 

22 (c)(2)(B)(i) based on the tons of carbon 

23 dioxide emissions that were avoided 

24 through operation of the carbon cap25 ture and permanent sequestration 


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1 project during the relevant calendar 

2 year. 

3 ‘‘(iv) NUMBER OF ALLOWANCES.—For 

4 purposes of clauses (iii)(II) and (viii)(I), 

5 for the purposes of calculating the number 

6 of allowances under subsection (c)(2)(B)(i), 

7 the Administrator shall enter the average 

8 fair market value of emission allowances in 

9 the year specified under subsection 

10 (c)(2)(B)(i)(II)(bb)). 

11 ‘‘(v) METHODS OF RECONCILIATION.— 

12 ‘‘(I) IN GENERAL.—If, in any cal13 endar year, the number of tons of car14 bon dioxide emissions projected to be 

15 avoided for that year under paragraph 

16 (1)(B)(i)(III) is greater than the num17 ber of tons of carbon dioxide emissions 

18 that were actually avoided by a project 

19 during that year, based on the report 

20 submitted to the Administrator under 

21 paragraph (3)(B)(iii), the difference 

22 may be accounted for by— 

23 ‘‘(aa) the owner or operator 

24 of the project capturing and stor25 ing an additional quantity of 


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1 emissions that cumulatively ex2 ceeds the difference between— 

3 ‘‘(AA) the number of 

4 tons of carbon dioxide emis5 sions that were projected to 

6 be avoided for the relevant 

7 calendar year under para8 graph (1)(B)(i)(II); and 

9 ‘‘(BB) the number of 

10 tons of carbon dioxide emis11 sions that were actually 

12 avoided through operation of 

13 the project during that year; 

14 ‘‘(bb) the Administrator ad15 justing the annual distributions 

16 under clause (iii), on the condi17 tion that the reduction shall be 

18 sufficient to account for the dif19 ference described in this subclause 

20 within the period specified by the 

21 Administrator in subclause (II); 

22 or 

23 ‘‘(cc) the owner or operator 

24 of the project making a repayment 

25 in accordance with clause (vi). 


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1 ‘‘(II) PERIOD.—Compliance with 

2 subclause (I)(aa) shall occur over a pe3 riod to be specified by the Adminis4 trator, but not to exceed 18 months. 

5 ‘‘(III) INTEREST.—The Adminis6 trator may apply an appropriate rate 

7 of interest to the repayment require8 ment under this clause. 

9 ‘‘(vi) ALTERNATE REPAYMENT BY AL10 LOWANCES OR CASH.—If the owner or oper11 ator of the project elects to comply by re12 paying in accordance with clause 

13 (v)(I)(aa), during the period specified by 

14 the Administrator under clause (v)(II), the 

15 owner or operator shall repay the Adminis16 trator an amount of allowances or cash (as 

17 calculated under clause (viii)) if— 

18 ‘‘(I) the number of tons of carbon 

19 dioxide emissions that were actually 

20 avoided through operation of the 

21 project during that period is less than 

22 the number necessary to rectify the dif23 ference described in clause (v)(I); and 

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1 ficient to adjust for the difference 

2 under clause (iii). 

3 ‘‘(vii) MILESTONES.—If the Adminis4 trator determines that the owner or operator 

5 failed to achieve a milestone for com6 mencing construction or commercial oper7 ation of the project (as specified in para8 graph (1)(B)), the owner or operator shall 

9 repay the Administrator an amount of al10 lowances or cash calculated under clause 

11 (viii). 

12 ‘‘(viii) CALCULATION.—The repay13 ments required under clauses (vi)(I) and 

14 (vii) shall be equal to, at the option of the 

15 owner or operator of the project— 

16 ‘‘(I) the difference between the 

17 numbers of allowances described in 

18 subclauses (I) and (II) of clause (iii); 

19 or 

20 ‘‘(II) a cash payment in an 

21 amount equal to the product obtained 

22 by multiplying— 

23 ‘‘(aa) the difference between 

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1 scribed in subclauses (I) and (II) 

2 of clause (iii); and 

3 ‘‘(bb) the average fair market 

4 value of an emission allowance 

5 during the year in which the re6 payment would be made under 

7 clause (vi). 

8 ‘‘(ix) USE OF REPAID AMOUNTS.—The 

9 Administrator shall use amounts received as 

10 repayments under this subparagraph to 

11 support the deployment of carbon capture 

12 and permanent sequestration. 

13 ‘‘(i) LIMITATIONS.— 

14 ‘‘(1) IN GENERAL.—Emission allowances shall be 

15 distributed under this section only for tons of carbon 

16 dioxide emissions that are captured and sequestered 

17 in accordance with this section. 

18 ‘‘(2) PERIOD.—A qualifying project may receive 

19 annual emission allowances under this section only 

20 for the first 10 years of operation. 

21 ‘‘(3) CAPACITY.— 

22 ‘‘(A) IN GENERAL.—Approximately 72 

23 gigawatts of total cumulative treated generating 

24 capacity may receive emission allowances under 

25 this section. 


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1 ‘‘(B) ALLOWANCE SURPLUS.—On reaching 

2 the cumulative capacity described in subpara3 graph (A), any emission allowances that are al4 located for carbon capture and permanent se5 questration deployment under section 771(a)(6) 

6 and are not yet obligated under this section shall 

7 be treated as emission allowances not designated 

8 for distribution for purposes of section 771(b)(2). 

9 ‘‘(j) EXHAUSTION OF ACCOUNT AND ANNUAL ROLL10 OVER OF SURPLUS EMISSION ALLOWANCES.— 

11 ‘‘(1) IN GENERAL.—In distributing emission al12 lowances under this section, the Administrator shall 

13 ensure that eligible projects receive distributions of 

14 emission allowances for the first 10 years of commer15 cial operation. 

16 ‘‘(2) DIFFERENT VINTAGE YEARS.— 

17 ‘‘(A) DETERMINATION.—If the Adminis18 trator determines that the emission allowances 

19 allocated under section 771(a)(6) with a vintage 

20 year that matches the year of distribution will be 

21 exhausted once the estimated full 10-year dis22 tributions will be provided to current eligible 

23 participants, the Administrator shall provide to 

24 new eligible projects emission allowances from 

25 vintage years after the year of the distribution. 


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1 ‘‘(B) DIVERSITY FACTORS.—If the Adminis2 trator provides allowances to new eligible 

3 projects under subparagraph (A), the Adminis4 trator shall promulgate regulations to prioritize 

5 new eligible projects that are distinguished from 

6 prior recipients of allowances by 1 or more of the 

7 following diversity factors (without regard to 

8 order): 

9 ‘‘(i) Location in a coal-producing re10 gion that provides a majority of coal to the 

11 project. 

12 ‘‘(ii) Coal type, including waste coal. 

13 ‘‘(iii) Capture and transportation tech14 nologies. 

15 ‘‘(iv) Geological formations. 

16 ‘‘(v) New units and retrofit applica17 tions. 

18 ‘‘(k) DAVIS-BACON COMPLIANCE.— 

19 ‘‘(1) IN GENERAL.—All laborers and mechanics 

20 employed on projects funded directly by or assisted in 

21 whole or in part by this section through the use of 

22 emission allowances shall be paid wages at rates not 

23 less than those prevailing on projects of a character 

24 similar in the locality as determined by the Secretary 


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1 of Labor in accordance with subchapter IV of chapter 

2 31 of title 40, United States Code. 

3 ‘‘(2) AUTHORITY.—With respect to the labor 

4 standards specified in this subsection, the Secretary of 

5 Labor shall have the authority and functions set forth 

6 in Reorganization Plan Numbered 14 of 1950 (64 

7 Stat. 1267; 5 U.S.C. App.) and section 3145 of title 

8 40, United States Code. 

9 ‘‘SEC. 781. OVERSIGHT OF ALLOCATIONS. 

10 ‘‘(a) IN GENERAL.—Not later than January 1, 2014, 

11 and every 2 years thereafter, the Comptroller General of the 

12 United States shall carry out a review of programs admin13 istered by the Federal Government that distribute emission 

14 allowances or funds from any Federal auction of allow15 ances. 

16 ‘‘(b) CONTENTS.—Each such report shall include a 

17 comprehensive evaluation of the administration and effec18 tiveness of each program, including— 

19 ‘‘(1) the efficiency, transparency, and soundness 

20 of the administration of each program; 

21 ‘‘(2) the performance of activities receiving as22 sistance under each program; 

23 ‘‘(3) the cost-effectiveness of each program in 

24 achieving the stated purposes of the program; and 


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1 ‘‘(4) recommendations, if any, for regulatory or 

2 administrative changes to each program to improve 

3 its effectiveness. 

4 ‘‘(c) FOCUS.—In evaluating program performance, 

5 each review under this section review shall address the effec6 tiveness of such programs in— 

7 ‘‘(1) creating and preserving jobs; 

8 ‘‘(2) ensuring a manageable transition for work9 ing families and workers; 

10 ‘‘(3) reducing the emissions, or enhancing seques11 tration, of greenhouse gases; 

12 ‘‘(4) developing clean technologies; and 

13 ‘‘(5) building resilience to the impacts of climate 

14 change. 

15 ‘‘SEC. 782. EARLY ACTION RECOGNITION. 

16 ‘‘(a) IN GENERAL.—Emission allowances allocated 

17 pursuant to section 771(a)(7) shall be distributed by the 

18 Administrator in accordance with this section. Not later 

19 than 1 year after the date of enactment of this title, the 

20 Administrator shall issue regulations allowing— 

21 ‘‘(1) any person in the United States to exchange 

22 instruments in the nature of offset credits issued be23 fore January 1, 2009, by a State, local, or voluntary 

24 offset program with respect to which the Adminis25 trator has made an affirmative determination under 


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1 section 740(a)(2), for emission allowances established 

2 by the Administrator under section 721(a); and 

3 ‘‘(2) the Administrator to provide compensation 

4 in the form of emission allowances to entities, includ5 ing units of local government, that do not meet the 

6 criteria of paragraph (1) and meet the criteria of this 

7 paragraph for documented early reductions or avoid8 ance of greenhouse gas emissions or greenhouse gases 

9 sequestered before January 1, 2009, from projects or 

10 process improvements begun before January 1, 2009, 

11 where— 

12 ‘‘(A) the entity publicly stated greenhouse 

13 gas reduction goals and publicly reported 

14 against those goals; 

15 ‘‘(B) the entity demonstrated entity-wide 

16 net greenhouse gas reductions; and 

17 ‘‘(C) the entity demonstrates the actual 

18 projects or process improvements undertaken to 

19 make reductions and documents the reductions 

20 (such as through documentation of engineering 

21 projects). 

22 ‘‘(b) REGULATIONS.—Regulations issued under sub23 section (a) shall— 

24 ‘‘(1) provide that a person exchanging credits 

25 under subsection (a)(1) receive emission allowances 


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1 established under section 721(a) in an amount for 

2 which the monetary value is equivalent to the average 

3 monetary value of the credits during the period from 

4 January 1, 2006, to January 1, 2009, as adjusted for 

5 inflation to reflect current dollar values at the time 

6 of the exchange; 

7 ‘‘(2) provide that a person receiving compensa8 tion for documented early action under subsection 

9 (a)(2) shall receive emission allowances established 

10 under section 721(a) in an amount that is approxi11 mately equivalent in value to the carbon dioxide 

12 equivalent per ton value received by entities in ex13 change for credits under paragraph (1) (as adjusted 

14 for inflation to reflect current dollar values at the 

15 time of the exchange), as determined by the Adminis16 trator; 

17 ‘‘(3) provide that only reductions or avoidance of 

18 greenhouse gas emissions, or sequestration of green19 house gases, achieved by activities in the United 

20 States between January 1, 2001, and January 1, 

21 2009, may be compensated under this section, and 

22 only credits issued for such activities may be ex23 changed under this section; 

24 ‘‘(4) provide that only credits that have not been 

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1 datory commitment, and have not expired, may be ex2 changed under subsection (a)(1); 

3 ‘‘(5) require that, once exchanged, the credit be 

4 retired for purposes of use under the program by or 

5 for which it was originally issued; and 

6 ‘‘(6) establish a deadline by which persons must 

7 exchange the credits or request compensation for early 

8 action under this section. 

9 ‘‘(c) PARTICIPATION.—Participation in an exchange of 

10 credits for allowances or compensation for early action au11 thorized by this section shall not preclude any person from 

12 participation in an offset credit program established under 

13 part D. 

14 ‘‘SEC. 783. ESTABLISHMENT OF DEFICIT REDUCTION FUND. 

15 ‘‘(a) DEFICIT REDUCTION FUND.—There is established 

16 in the Treasury of the United States a fund, to be known 

17 as the ‘Deficit Reduction Fund’. 

18 ‘‘(b) DISBURSEMENTS.—No disbursement shall be 

19 made from the Deficit Reduction Fund except pursuant to 

20 an appropriation Act.’’. 


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1 Subtitle C—Additional Greenhouse 

2 Gas Standards 

3 SEC. 121. GREENHOUSE GAS STANDARDS. 

4 The Clean Air Act (42 U.S.C. 7401 et seq.), as amend5 ed by subtitles A and B of this title, is further amended 

6 by adding the following new title after title VII: 

7 ‘‘TITLE VIII—ADDITIONAL 

8 GREENHOUSE GAS STANDARDS 

9 ‘‘SEC. 801. DEFINITIONS. 

10 ‘‘For purposes of this title, terms that are defined in 

11 title VII, except for the term ‘stationary source’, shall have 

12 the meanings given those terms in title VII. 

13 ‘‘PART A—STATIONARY SOURCE STANDARDS 

14 ‘‘SEC. 811. STANDARDS OF PERFORMANCE. 

15 ‘‘(a) DEFINITION OF UNCAPPED GREENHOUSE GAS

16 EMISSIONS.—In this section, the term ‘uncapped green17 house gas emissions’ means those greenhouse gas emissions 

18 to which section 722 does not apply. 

19 ‘‘(b) STANDARDS.—Before January 1, 2020, the Ad20 ministrator shall not promulgate new source performance 

21 standards for greenhouse gases under section 111 that are 

22 applicable to any stationary source that— 

23 ‘‘(1) emits uncapped greenhouse gas emissions; 

24 and 


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1 ‘‘(2) qualifies as an eligible offset project pursu2 ant to section 733 that is eligible to receive an offset 

3 credit pursuant to section 737.’’. 

4 SEC. 122. HFC REGULATION. 

5 (a) IN GENERAL.—Title VI of the Clean Air Act (42 

6 U.S.C. 7671 et seq.) (relating to stratospheric ozone protec7 tion) is amended by adding at the end the following: 

8 ‘‘SEC. 619. HYDROFLUOROCARBONS (HFCS). 

9 ‘‘(a) TREATMENT AS CLASS II, GROUP II SUB10 STANCES.—Except as otherwise provided in this section, 

11 hydrofluorocarbons shall be treated as class II substances 

12 for purposes of applying the provisions of this title. The 

13 Administrator shall establish two groups of class II sub14 stances. Class II, group I substances shall include all 

15 hydrochlorofluorocarbons (HCFCs) listed pursuant to sec16 tion 602(b). Class II, group II substances shall include each 

17 of the following: 

18 ‘‘(1) Hydrofluorocarbon-23 (HFC–23). 

19 ‘‘(2) Hydrofluorocarbon-32 (HFC–32). 

20 ‘‘(3) Hydrofluorocarbon-41 (HFC–41). 

21 ‘‘(4) Hydrofluorocarbon-125 (HFC–125). 

22 ‘‘(5) Hydrofluorocarbon-134 (HFC–134). 

23 ‘‘(6) Hydrofluorocarbon-134a (HFC–134a). 

24 ‘‘(7) Hydrofluorocarbon-143 (HFC–143). 

25 ‘‘(8) Hydrofluorocarbon-143a (HFC–143a). 


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1 ‘‘(9) Hydrofluorocarbon-152 (HFC–152). 

2 ‘‘(10) Hydrofluorocarbon-152a (HFC–152a). 

3 ‘‘(11) Hydrofluorocarbon-227ea (HFC–227ea). 

4 ‘‘(12) Hydrofluorocarbon-236cb (HFC–236cb). 

5 ‘‘(13) Hydrofluorocarbon-236ea (HFC–236ea). 

6 ‘‘(14) Hydrofluorocarbon-236fa (HFC–236fa). 

7 ‘‘(15) Hydrofluorocarbon-245ca (HFC–245ca). 

8 ‘‘(16) Hydrofluorocarbon-245fa (HFC–245fa). 

9 ‘‘(17) Hydrofluorocarbon-365mfc (HFC–365mfc). 

10 ‘‘(18) Hydrofluorocarbon-43-10mee (HFC–43– 

11 10mee). 

12 ‘‘(19) Hydrofluoroolefin-1234yf (HFO–1234yf). 

13 ‘‘(20) Hydrofluoroolefin-1234ze (HFO–1234ze). 

14 Not later than 6 months after the date of enactment of this 

15 title, the Administrator shall publish an initial list of class 

16 II, group II substances, which shall include the substances 

17 listed in this subsection. The Administrator may add to the 

18 list of class II, group II substances any other substance used 

19 as a substitute for a class I or II substance if the Adminis20 trator determines that 1 metric ton of the substance makes 

21 the same or greater contribution to global warming over 

22 100 years as 1 metric ton of carbon dioxide. Within 24 

23 months after the date of enactment of this section, the Ad24 ministrator shall amend the regulations under this title (in25 cluding the regulations referred to in sections 603, 608, 609, 


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1 610, 611, 612, and 613) to apply to class II, group II sub2 stances. 

3 ‘‘(b) CONSUMPTION AND PRODUCTION OF CLASS II, 

4 GROUP II SUBSTANCES.— 

5 ‘‘(1) IN GENERAL.— 

6 ‘‘(A) CONSUMPTION PHASE DOWN.—In the 

7 case of class II, group II substances, in lieu of 

8 applying section 605 and the regulations there9 under, the Administrator shall promulgate regu10 lations phasing down the consumption of class 

11 II, group II substances in the United States, and 

12 the importation of products containing any class 

13 II, group II substance, in accordance with this 

14 subsection within 18 months after the date of en15 actment of this section. Effective January 1, 

16 2012, it shall be unlawful for any person to 

17 produce any class II, group II substance, import 

18 any class II, group II substance, or import any 

19 product containing any class II, group II sub20 stance without holding one consumption allow21 ance or one destruction offset credit for each car22 bon dioxide equivalent ton of the class II, group 

23 II substance. Any person who exports a class II, 

24 group II substance for which a consumption al25 lowance was retired may receive a refund of that 


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1 allowance from the Administrator following the 

2 export. 

3 ‘‘(B) PRODUCTION.—If the United States 

4 becomes a party or otherwise adheres to a multi5 lateral agreement, including any amendment to 

6 the Montreal Protocol on Substances That De7 plete the Ozone Layer, that restricts the produc8 tion of class II, group II substances, the Admin9 istrator shall promulgate regulations establishing 

10 a baseline for the production of class II, group 

11 II substances in the United States and phasing 

12 down the production of class II, group II sub13 stances in the United States, in accordance with 

14 such multilateral agreement and subject to the 

15 same exceptions and other provisions as are ap16 plicable to the phase down of consumption of 

17 class II, group II substances under this section 

18 (except that the Administrator shall not require 

19 a person who obtains production allowances 

20 from the Administrator to make payment for 

21 such allowances if the person is making payment 

22 for a corresponding quantity of consumption al23 lowances of the same vintage year). Upon the ef24 fective date of such regulations, it shall be un25 lawful for any person to produce any class II, 


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1 group II substance without holding one con2 sumption allowance and one production allow3 ance, or one destruction offset credit, for each 

4 carbon dioxide equivalent ton of the class II, 

5 group II substance. 

6 ‘‘(C) INTEGRITY OF LIMITS.—To maintain 

7 the integrity of the class II, group II limits, the 

8 Administrator may, through rulemaking, limit 

9 the percentage of each person’s compliance obli10 gation that may be met through the use of de11 struction offset credits or banked allowances. 

12 ‘‘(D) COUNTING OF VIOLATIONS.—Each con13 sumption allowance, production allowance, or 

14 destruction offset credit not held as required by 

15 this section shall be a separate violation of this 

16 section. 

17 ‘‘(2) SCHEDULE.—Pursuant to the regulations 

18 promulgated pursuant to paragraph (1)(A), the num19 ber of class II, group II consumption allowances es20 tablished by the Administrator for each calendar year 

21 beginning in 2012 shall be the following percentage of 

22 the baseline, as established by the Administrator pur23 suant to paragraph (3): 

‘‘Calendar Year Percent of Baseline 

2012 90 


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‘‘Calendar Year Percent of Baseline 

2013 87.5 

2014 85 

2015 82.5 

2016 80 

2017 77.5 

2018 75 

2019 71 

2020 67 

2021 63 

2022 59 

2023 54 

2024 50 

2025 46 

2026 42 

2027 38 

2028 34 

2029 30 

2030 25 

2031 21 

2032 17 

after 2032 15 

1 ‘‘(3) BASELINE.—(A) Not later than 1 year after 

2 the date of enactment of this section, the Adminis3 trator shall promulgate regulations to establish the 

4 baseline for purposes of paragraph (2). The baseline 


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1 shall be the sum, expressed in metric tons of carbon 

2 dioxide equivalents, of— 

3 ‘‘(i) the annual average consumption of all 

4 class II substances in calendar years 2004, 2005, 

5 and 2006; plus 

6 ‘‘(ii) the annual average quantity of all 

7 class II substances contained in imported prod8 ucts in calendar years 2004, 2005, and 2006. 

9 ‘‘(B) Notwithstanding subparagraph (A), if the 

10 Administrator determines that the baseline is higher 

11 than 370 million metric tons of carbon dioxide 

12 equivalents, then the Administrator shall establish the 

13 baseline at 370 million metric tons of carbon dioxide 

14 equivalents. 

15 ‘‘(C) Notwithstanding subparagraph (A), if the 

16 Administrator determines that the baseline is lower 

17 than 280 million metric tons of carbon dioxide 

18 equivalents, then the Administrator shall establish the 

19 baseline at 280 million metric tons of carbon dioxide 

20 equivalents. 

21 ‘‘(4) DISTRIBUTION OF ALLOWANCES.— 

22 ‘‘(A) IN GENERAL.—Pursuant to the regula23 tions promulgated under paragraph (1)(A), for 

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1 ministrator shall sell consumption allowances in 

2 accordance with this paragraph. 

3 ‘‘(B) ESTABLISHMENT OF POOLS.—The Ad4 ministrator shall establish two allowance pools. 

5 Eighty percent of the consumption allowances 

6 available for a calendar year shall be placed in 

7 the producer-importer pool, and 20 percent of the 

8 consumption allowances available for a calendar 

9 year shall be placed in the secondary pool. 

10 ‘‘(C) PRODUCER-IMPORTER POOL.— 

11 ‘‘(i) AUCTION.—(I) For each calendar 

12 year, the Administrator shall offer for sale 

13 at auction the following percentage of the 

14 consumption allowances in the producer-im15 porter pool: 

‘‘Calendar Year Percent Available for Auction 

2012 10 

2013 20 

2014 30 

2015 40 

2016 50 

2017 60 

2018 70 

2019 80 

2020 and thereafter 90 


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1 ‘‘(II) Any person who produced or im2 ported any class II substance during cal3 endar year 2004, 2005, or 2006 may par4 ticipate in the auction. No other persons 

5 may participate in the auction unless per6 mitted to do so pursuant to subclause (III). 

7 ‘‘(III) Not later than 3 years after the 

8 date of the initial auction and from time to 

9 time thereafter, the Administrator shall de10 termine through rulemaking whether any 

11 persons who did not produce or import a 

12 class II substance during calendar year 

13 2004, 2005, or 2006 will be permitted to 

14 participate in future auctions. The Admin15 istrator shall base this determination on the 

16 duration, consistency, and scale of such per17 son’s purchases of consumption allowances 

18 in the secondary pool under subparagraph 

19 (D)(ii)(III), as well as economic or tech20 nical hardship and other factors deemed rel21 evant by the Administrator. 

22 ‘‘(IV) The Administrator shall set a 

23 minimum bid per consumption allowance of 

24 the following: 


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1 ‘‘(aa) For vintage year 2012, 

2 $1.00. 

3 ‘‘(bb) For vintage year 2013, 

4 $1.20. 

5 ‘‘(cc) For vintage year 2014, 

6 $1.40. 

7 ‘‘(dd) For vintage year 2015, 

8 $1.60. 

9 ‘‘(ee) For vintage year 2016, 

10 $1.80. 

11 ‘‘(ff) For vintage year 2017, 

12 $2.00. 

13 ‘‘(gg) For vintage year 2018 and 

14 thereafter, $2.00 adjusted for inflation 

15 after vintage year 2017 based upon the 

16 producer price index as published by 

17 the Department of Commerce. 

18 ‘‘(ii) NON-AUCTION SALE.—(I) For 

19 each calendar year, as soon as practicable 

20 after auction, the Administrator shall offer 

21 for sale the remaining consumption allow22 ances in the producer-importer pool at the 

23 following prices: 

24 ‘‘(aa) A fee of $1.00 per vintage 

25 year 2012 allowance. 


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1 ‘‘(bb) A fee of $1.20 per vintage 

2 year 2013 allowance. 

3 ‘‘(cc) A fee of $1.40 per vintage 

4 year 2014 allowance. 

5 ‘‘(dd) For each vintage year 2015 

6 allowance, a fee equal to the average of 

7 $1.10 and the auction clearing price 

8 for vintage year 2014 allowances. 

9 ‘‘(ee) For each vintage year 2016 

10 allowance, a fee equal to the average of 

11 $1.30 and the auction clearing price 

12 for vintage year 2015 allowances. 

13 ‘‘(ff) For each vintage year 2017 

14 allowance, a fee equal to the average of 

15 $1.40 and the auction clearing price 

16 for vintage year 2016 allowances. 

17 ‘‘(gg) For each allowance of vin18 tage year 2018 and subsequent vintage 

19 years, a fee equal to the auction clear20 ing price for that vintage year. 

21 ‘‘(II) The Administrator shall offer to 

22 sell the remaining consumption allowances 

23 in the producer-importer pool to producers 

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1 ers of class II, group II substances in pro2 portion to their relative allocation share. 

3 ‘‘(III) Such allocation share for such 

4 sale shall be determined by the Adminis5 trator using such producer’s or importer’s 

6 annual average data on class II substances 

7 from calendar years 2004, 2005, and 2006, 

8 on a carbon dioxide equivalent basis, and— 

9 ‘‘(aa) shall be based on a pro10 ducer’s production, plus importation, 

11 plus acquisitions and purchases from 

12 persons who produced class II sub13 stances in the United States during 

14 calendar year 2004, 2005, or 2006, less 

15 exportation, less transfers and sales to 

16 persons who produced class II sub17 stances in the United States during 

18 calendar year 2004, 2005, or 2006; 

19 and 

20 ‘‘(bb) for an importer of class II 

21 substances that did not produce in the 

22 United States any class II substance 

23 during calendar years 2004, 2005, and 

24 2006, shall be based on the importer’s 

25 importation less exportation. 


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1 For purposes of item (aa), the Adminis2 trator shall account for 100 percent of class 

3 II, group II substances and 60 percent of 

4 class II, group I substances. For purposes of 

5 item (bb), the Administrator shall account 

6 for 100 percent of class II, group II sub7 stances and 100 percent of class II, group 

8 I substances. 

9 ‘‘(IV) Any consumption allowances 

10 made available for nonauction sale to a spe11 cific producer or importer of class II, group 

12 II substances but not purchased by the spe13 cific producer or importer shall be made 

14 available for sale to any producer or im15 porter of class II substances during cal16 endar year 2004, 2005, or 2006. If demand 

17 for such consumption allowances exceeds 

18 supply of such consumption allowances, the 

19 Administrator shall develop and utilize cri20 teria for the sale of such consumption allow21 ances that may include pro rata shares, his22 toric production and importation, economic 

23 or technical hardship, or other factors 

24 deemed relevant by the Administrator. If 

25 the supply of such consumption allowances 


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1 exceeds demand, the Administrator may 

2 offer such consumption allowances for sale 

3 in the secondary pool as set forth in sub4 paragraph (D). 

5 ‘‘(D) SECONDARY POOL.—(i) For each cal6 endar year, as soon as practicable after the auc7 tion required in subparagraph (C), the Adminis8 trator shall offer for sale the consumption allow9 ances in the secondary pool at the prices listed 

10 in subparagraph (C)(ii). 

11 ‘‘(ii) The Administrator shall accept appli12 cations for purchase of secondary pool consump13 tion allowances from— 

14 ‘‘(I) importers of products containing 

15 class II, group II substances; 

16 ‘‘(II) persons who purchased any class 

17 II, group II substance directly from a pro18 ducer or importer of class II, group II sub19 stances for use in a product containing a 

20 class II, group II substance, a manufac21 turing process, or a reclamation process; 

22 ‘‘(III) persons who did not produce or 

23 import a class II substance during calendar 

24 year 2004, 2005, or 2006, but who the Ad25 ministrator determines have subsequently 


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1 taken significant steps to produce or import 

2 a substantial quantity of any class II, 

3 group II substance; and 

4 ‘‘(IV) persons who produced or im5 ported any class II substance during cal6 endar year 2004, 2005, or 2006. 

7 ‘‘(iii) If the supply of consumption allow8 ances in the secondary pool equals or exceeds the 

9 demand for consumption allowances in the sec10 ondary pool as presented in the applications for 

11 purchase, the Administrator shall sell the con12 sumption allowances in the secondary pool to the 

13 applicants in the amounts requested in the ap14 plications for purchase. Any consumption allow15 ances in the secondary pool not purchased in a 

16 calendar year may be rolled over and added to 

17 the quantity available in the secondary pool in 

18 the following year. 

19 ‘‘(iv) If the demand for consumption allow20 ances in the secondary pool as presented in the 

21 applications for purchase exceeds the supply of 

22 consumption allowances in the secondary pool, 

23 the Administrator shall sell the consumption al24 lowances as follows: 


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1 ‘‘(I) The Administrator shall first sell 

2 the consumption allowances in the sec3 ondary pool to any importers of products 

4 containing class II, group II substances in 

5 the amounts requested in their applications 

6 for purchase. If the demand for such con7 sumption allowances exceeds supply of such 

8 consumption allowances, the Administrator 

9 shall develop and utilize criteria for the sale 

10 of such consumption allowances among im11 porters of products containing class II, 

12 group II substances that may include pro 

13 rata shares, historic importation, economic 

14 or technical hardship, or other factors 

15 deemed relevant by the Administrator. 

16 ‘‘(II) The Administrator shall next sell 

17 any remaining consumption allowances to 

18 persons identified in subclauses (II) and 

19 (III) of clause (ii) in the amounts requested 

20 in their applications for purchase. If the de21 mand for such consumption allowances ex22 ceeds remaining supply of such consump23 tion allowances, the Administrator shall de24 velop and utilize criteria for the sale of such 

25 consumption allowances among subclauses 


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1 (II) and (III) applicants that may include 

2 pro rata shares, historic use, economic or 

3 technical hardship, or other factors deemed 

4 relevant by the Administrator. 

5 ‘‘(III) The Administrator shall then 

6 sell any remaining consumption allowances 

7 to persons who produced or imported any 

8 class II substance during calendar year 

9 2004, 2005, or 2006 in the amounts re10 quested in their applications for purchase. 

11 If demand for such consumption allowances 

12 exceeds remaining supply of such consump13 tion allowances, the Administrator shall de14 velop and utilize criteria for the sale of such 

15 consumption allowances that may include 

16 pro rata shares, historic production and im17 portation, economic or technical hardship, 

18 or other factors deemed relevant by the Ad19 ministrator. 

20 ‘‘(IV) Each person who purchases con21 sumption allowances in a non-auction sale 

22 under this subparagraph shall be required 

23 to disclose the person or entity sponsoring 

24 or benefitting from the purchases if such 

25 person or entity is, in whole or in part, 


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1 other than the purchaser or the purchaser’s 

2 employer. 

3 ‘‘(E) DISCRETION TO WITHHOLD ALLOW4 ANCES.—Nothing in this paragraph prevents the 

5 Administrator from exercising discretion to 

6 withhold and retire consumption allowances that 

7 would otherwise be available for auction or non8 auction sale, or to allocate such allowances for 

9 essential uses pursuant to subsection (d). Not 

10 later than 18 months after the date of enactment 

11 of this section, the Administrator shall promul12 gate regulations establishing criteria for with13 holding and retiring consumption allowances 

14 and governing the allocation of withheld allow15 ances for essential uses subject to the criteria 

16 under subsection (d). 

17 ‘‘(5) BANKING.—A consumption allowance or de18 struction offset credit may be used to meet the compli19 ance obligation requirements of paragraph (1) in— 

20 ‘‘(A) the vintage year for the allowance or 

21 destruction offset credit; or 

22 ‘‘(B) any calendar year subsequent to the 

23 vintage year for the allowance or destruction off24 set credit. 

25 ‘‘(6) AUCTIONS.— 


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1 ‘‘(A) INITIAL REGULATIONS.—Not later 

2 than 18 months after the date of enactment of 

3 this section, the Administrator shall promulgate 

4 regulations governing the auction of allowances 

5 under this section. Such regulations shall include 

6 the following requirements: 

7 ‘‘(i) FREQUENCY; FIRST AUCTION.— 

8 Auctions shall be held one time per year at 

9 regular intervals, with the first auction to 

10 be held no later than October 31, 2011. 

11 ‘‘(ii) AUCTION FORMAT.—Auctions 

12 shall follow a single-round, sealed-bid, uni13 form price format. 

14 ‘‘(iii) FINANCIAL ASSURANCE.—The 

15 Administrator may establish financial as16 surance requirements to ensure that auction 

17 participants can and will perform on their 

18 bids. 

19 ‘‘(iv) DISCLOSURE OF BENEFICIAL

20 OWNERSHIP.—Each bidder in the auction 

21 shall be required to disclose the person or 

22 entity sponsoring or benefitting from the 

23 bidder’s participation in the auction if such 

24 person or entity is, in whole or in part, 

25 other than the bidder. 


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1 ‘‘(v) PUBLICATION OF INFORMATION.— 

2 After the auction, the Administrator shall, 

3 in a timely fashion, publish the number of 

4 bidders, number of winning bidders, the 

5 quantity of allowances sold, and the auction 

6 clearing price. 

7 ‘‘(vi) BIDDING LIMITS IN 2012.—In the 

8 vintage year 2012 auction, no auction par9 ticipant may, directly or in concert with 

10 another participant, bid for or purchase 

11 more allowances offered for sale at the auc12 tion than the greater of— 

13 ‘‘(I) the number of allowances 

14 which, when added to the number of 

15 allowances available for purchase by 

16 the participant in the producer-im17 porter pool non-auction sale, would 

18 equal the participant’s annual average 

19 consumption of class II, group II sub20 stances in calendar years 2004, 2005, 

21 and 2006; or 

22 ‘‘(II) the number of allowances 

23 equal to the product of— 

24 ‘‘(aa) 1.20 multiplied by the 

25 participant’s allocation share of 


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1 the producer-importer pool non2 auction sale as determined under 

3 paragraph (4)(C)(ii); and 

4 ‘‘(bb) the number of vintage 

5 year 2012 allowances offered at 

6 auction. 

7 ‘‘(vii) BIDDING LIMITS IN 2013.—In the 

8 vintage year 2013 auction, no auction par9 ticipant may, directly or in concert with 

10 another participant, bid for or purchase 

11 more allowances offered for sale at the auc12 tion than the product of— 

13 ‘‘(I) 1.15 multiplied by the ratio 

14 of the total number of vintage year 

15 2012 allowances purchased by the par16 ticipant from the auction and from the 

17 producer-importer pool non-auction 

18 sale to the total number of vintage year 

19 2012 allowances in the producer-im20 porter pool; and 

21 ‘‘(II) the number of vintage year 

22 2013 allowances offered at auction. 

23 ‘‘(viii) BIDDING LIMITS IN SUBSE24 QUENT YEARS.—In the auctions for vintage 

25 year 2014 and subsequent vintage years, no 


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1 auction participant may, directly or in 

2 concert with another participant, bid for or 

3 purchase more allowances offered for sale at 

4 the auction than the product of— 

5 ‘‘(I) 1.15 multiplied by the ratio 

6 of the highest number of allowances re7 quired to be held by the participant in 

8 any of the three prior vintage years to 

9 meet its compliance obligation under 

10 paragraph (1) to the total number of 

11 allowances in the producer-importer 

12 pool for such vintage year; and 

13 ‘‘(II) the number of allowances of14 fered at auction for that vintage year. 

15 ‘‘(ix) OTHER REQUIREMENTS.—The 

16 Administrator may include in the regula17 tions such other requirements or provisions 

18 as the Administrator considers necessary to 

19 promote effective, efficient, transparent, and 

20 fair administration of auctions under this 

21 section. 

22 ‘‘(B) REVISION OF REGULATIONS.—The Ad23 ministrator may, at any time, revise the initial 

24 regulations promulgated under subparagraph 

25 (A) based on the Administrator’s experience in 


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1 administering allowance auctions by promul2 gating new regulations. Such revised regulations 

3 need not meet the requirements identified in sub4 paragraph (A) if the Administrator determines 

5 that an alternative auction design would be more 

6 effective, taking into account factors including 

7 costs of administration, transparency, fairness, 

8 and risks of collusion or manipulation. In deter9 mining whether and how to revise the initial 

10 regulations under this paragraph, the Adminis11 trator shall not consider maximization of reve12 nues to the Federal Government. 

13 ‘‘(C) DELEGATION OR CONTRACT.—Pursu14 ant to regulations under this section, the Admin15 istrator may, by delegation or contract, provide 

16 for the conduct of auctions under the Adminis17 trator’s supervision by other departments or 

18 agencies of the Federal Government or by non19 governmental agencies, groups, or organizations. 

20 ‘‘(7) PAYMENTS FOR ALLOWANCES.— 

21 ‘‘(A) INITIAL REGULATIONS.—Not later 

22 than 18 months after the date of enactment of 

23 this section, the Administrator shall promulgate 

24 regulations governing the payment for allow25 ances purchased in auction and non-auction 


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1 sales under this section. Such regulations shall 

2 include the requirement that, in the event that 

3 full payment for purchased allowances is not 

4 made on the date of purchase, equal payments 

5 shall be made one time per calendar quarter 

6 with all payments for allowances of a vintage 

7 year made by the end of that vintage year. 

8 ‘‘(B) REVISION OF REGULATIONS.—The Ad9 ministrator may, at any time, revise the initial 

10 regulations promulgated under subparagraph 

11 (A) based on the Administrator’s experience in 

12 administering collection of payments by promul13 gating new regulations. Such revised regulations 

14 need not meet the requirements identified in sub15 paragraph (A) if the Administrator determines 

16 that an alternative payment structure or fre17 quency would be more effective, taking into ac18 count factors including cost of administration, 

19 transparency, and fairness. In determining 

20 whether and how to revise the initial regulations 

21 under this paragraph, the Administrator shall 

22 not consider maximization of revenues to the 

23 Federal Government. 

24 ‘‘(C) PENALTIES FOR NON-PAYMENT.—Fail25 ure to pay for purchased allowances in accordVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01625 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ance with the regulations promulgated pursuant 

2 to this paragraph shall be a violation of the re3 quirements of subsection (b). Section 113(c)(3) 

4 shall apply in the case of any person who know5 ingly fails to pay for purchased allowances in 

6 accordance with the regulations promulgated 

7 pursuant to this paragraph. 

8 ‘‘(8) IMPORTED PRODUCTS.—If the United States 

9 becomes a party or otherwise adheres to a multilateral 

10 agreement, including any amendment to the Montreal 

11 Protocol on Substances That Deplete the Ozone Layer, 

12 which restricts the production or consumption of class 

13 II, group II substances— 

14 ‘‘(A) as of the date on which such agreement 

15 or amendment enters into force, it shall no 

16 longer be unlawful for any person to import 

17 from a party to such agreement or amendment 

18 any product containing any class II, group II 

19 substance whose production or consumption is 

20 regulated by such agreement or amendment with21 out holding one consumption allowance or one 

22 destruction offset credit for each carbon dioxide 

23 equivalent ton of the class II, group II substance; 

24 ‘‘(B) the Administrator shall promulgate 

25 regulations within 12 months of the date the 


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1 United States becomes a party or otherwise ad2 heres to such agreement or amendment, or the 

3 date on which such agreement or amendment en4 ters into force, whichever is later, to establish a 

5 new baseline for purposes of paragraph (2), 

6 which new baseline shall be the original baseline 

7 less the carbon dioxide equivalent of the annual 

8 average quantity of any class II substances regu9 lated by such agreement or amendment con10 tained in products imported from parties to such 

11 agreement or amendment in calendar years 

12 2004, 2005, and 2006; 

13 ‘‘(C) as of the date on which such agreement 

14 or amendment enters into force, no person im15 porting any product containing any class II, 

16 group II substance may, directly or in concert 

17 with another person, purchase any consumption 

18 allowances for sale by the Administrator for the 

19 importation of products from a party to such 

20 agreement or amendment that contain any class 

21 II, group II substance restricted by such agree22 ment or amendment; and 

23 ‘‘(D) the Administrator may adjust the two 

24 allowance pools established in paragraph (4) 

25 such that up to 90 percent of the consumption 


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1 allowances available for a calendar year are 

2 placed in the producer-importer pool with the re3 maining consumption allowances placed in the 

4 secondary pool. 

5 ‘‘(9) OFFSETS.— 

6 ‘‘(A) CHLOROFLUOROCARBON DESTRUC7 TION.—Within 18 months after the date of enact8 ment of this section, the Administrator shall pro9 mulgate regulations to provide for the issuance of 

10 offset credits for the destruction, in the calendar 

11 year 2012 or later, of chlorofluorocarbons in the 

12 United States. The Administrator shall establish 

13 and distribute to the destroying entity a quan14 tity of destruction offset credits equal to 0.8 

15 times the number of metric tons of carbon diox16 ide equivalents of reduction achieved through the 

17 destruction. No destruction offset credits shall be 

18 established for the destruction of a class II, group 

19 II substance. 

20 ‘‘(B) DEFINITION.—For purposes of this 

21 paragraph, the term ‘destruction’ means the con22 version of a substance by thermal, chemical, or 

23 other means to another substance with little or 

24 no carbon dioxide equivalent value and no ozone 

25 depletion potential. 


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1 ‘‘(C) REGULATIONS.—The regulations pro2 mulgated under this paragraph shall include 

3 standards and protocols for project eligibility, 

4 certification of destroyers, monitoring, tracking, 

5 destruction efficiency, quantification of project 

6 and baseline emissions and carbon dioxide equiv7 alent value, and verification. The Administrator 

8 shall ensure that destruction offset credits rep9 resent real and verifiable destruction of 

10 chlorofluorocarbons or other class I or class II, 

11 group I, substances authorized under subpara12 graph (D). 

13 ‘‘(D) OTHER SUBSTANCES.—The Adminis14 trator may promulgate regulations to add to the 

15 list of class I and class II, group I, substances 

16 that may be destroyed for destruction offset cred17 its, taking into account a candidate substance’s 

18 carbon dioxide equivalent value, ozone depletion 

19 potential, prevalence in banks in the United 

20 States, and emission rates, as well as the need 

21 for additional cost containment under the class 

22 II, group II limits and the integrity of the class 

23 II, group II limits. The Administrator shall not 

24 add a class I or class II, group I substance to 

25 the list if the consumption of the substance has 


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1 not been completely phased-out internationally 

2 (except for essential use exemptions or other 

3 similar exemptions) pursuant to the Montreal 

4 Protocol. 

5 ‘‘(E) EXTENSION OF OFFSETS.—(i) At any 

6 time after the Administrator promulgates regula7 tions pursuant to subparagraph (A), the Admin8 istrator may, pursuant to the requirements of 

9 part D of title VII and based on the carbon diox10 ide equivalent value of the substance destroyed, 

11 add the types of destruction projects authorized 

12 to receive destruction offset credits under this 

13 paragraph to the list of types of projects eligible 

14 for offset credits under section 733. If such 

15 projects are added to the list under section 733, 

16 the issuance of offset credits for such projects 

17 under part D of title VII shall be governed by the 

18 requirements of such part D, while the issuance 

19 of offset credits for such projects under this para20 graph shall be governed by the requirements of 

21 this paragraph. Nothing in this paragraph shall 

22 affect the issuance of offset credits under section 

23 740. 

24 ‘‘(ii) The Administrator shall not make the 

25 addition under clause (i) unless the AdminisVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01630 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 trator finds that insufficient destruction is occur2 ring or is projected to occur under this para3 graph and that the addition would increase de4 struction. 

5 ‘‘(iii) In no event shall more than one de6 struction offset credit be issued under title VII 

7 and this section for the destruction of the same 

8 quantity of a substance. 

9 ‘‘(10) LEGAL STATUS OF ALLOWANCES AND

10 CREDITS.—None of the following constitutes a prop11 erty right: 

12 ‘‘(A) A production or consumption allow13 ance. 

14 ‘‘(B) A destruction offset credit. 

15 ‘‘(c) DEADLINES FOR COMPLIANCE.—Notwithstanding 

16 the deadlines specified for class II substances in sections 

17 608, 609, 610, 612, and 613 that occur prior to January 

18 1, 2009, the deadline for promulgating regulations under 

19 those sections for class II, group II substances shall be Janu20 ary 1, 2012. 

21 ‘‘(d) EXCEPTIONS FOR ESSENTIAL USES.—Notwith22 standing the provisions of this section regarding auction 

23 and nonauction sale of allowances, to the extent consistent 

24 with any applicable multilateral agreement to which the 

25 United States is a party or otherwise adheres, the AdminisVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01631 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 trator may allocate (and in the case of medical devices, 

2 shall determine whether to allocate) allowances withheld 

3 from auction or nonauction sale under subsection (b)(4)(E) 

4 for essential uses pursuant to the following requirements: 

5 ‘‘(1) MEDICAL DEVICES.—The Administrator, 

6 after notice and opportunity for public comment, and 

7 in consultation with the Commissioner of Food and 

8 Drugs, shall determine whether to allocate withheld 

9 allowances for the production and consumption of 

10 class II, group II substances solely for use in medical 

11 devices approved and determined to be essential by 

12 the Commissioner. Not later than 20 months after the 

13 date of enactment of this title, the Commissioner shall 

14 approve and determine essential medical devices. For 

15 purposes of this section, section 601(8)(A) shall not 

16 apply to metered dose inhalers. 

17 ‘‘(2) AVIATION AND SPACE VEHICLE SAFETY.— 

18 The Administrator, after notice and opportunity for 

19 public comment, and in consultation with the Admin20 istrator of the Federal Aviation Administration or the 

21 Administrator of the National Aeronautics and Space 

22 Administration, may allocate withheld allowances for 

23 the production and consumption of class II, group II 

24 substances solely for aviation and space flight safety 

25 purposes. 


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1 ‘‘(3) FIRE SUPPRESSION.—The Administrator, 

2 after notice and opportunity for public comment, may 

3 allocate withheld allowances for the production and 

4 consumption of class II, group II substances solely for 

5 fire suppression purposes. Paragraphs (1) and (2) of 

6 subsection (g) of section 604 shall apply to class II, 

7 group II substances in the same manner and to the 

8 same extent as such provisions apply to the sub9 stances specified in such subsection. 

10 ‘‘(4) NATIONAL SECURITY.—The Administrator, 

11 after notice and opportunity for public comment, and 

12 in consultation with the Secretary of Defense, may al13 locate withheld allowances for the production and 

14 consumption of class II, group II substances for use 

15 as may be necessary to protect the national security 

16 interests of the United States if the Administrator, in 

17 consultation with the Secretary of Defense, finds that 

18 adequate substitutes are not available and that the 

19 production or consumption of such substance is nec20 essary to protect such national security interest. 

21 ‘‘(e) DEVELOPING COUNTRIES.—Notwithstanding any 

22 phase down of production required by this section, the Ad23 ministrator, after notice and opportunity for public com24 ment, may authorize the production of limited quantities 

25 of class II, group II substances in excess of the amounts 


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1 otherwise allowable under this section solely for export to, 

2 and use in, developing countries. Any production author3 ized under this subsection shall be solely for purposes of sat4 isfying the basic domestic needs of such countries as pro5 vided in applicable international agreements, if any, to 

6 which the United States is a party or otherwise adheres. 

7 ‘‘(f) NATIONAL SECURITY; FIRE SUPPRESSION, ETC.— 

8 The provisions of subsection (f) and paragraphs (1) and 

9 (2) of subsection (g) of section 604 shall apply to any con10 sumption and production phase down of class II, group II 

11 substances in the same manner and to the same extent, con12 sistent with any applicable international agreement to 

13 which the United States is a party or otherwise adheres, 

14 as such provisions apply to the substances specified in such 

15 subsection. 

16 ‘‘(g) ACCELERATED SCHEDULE.—In lieu of section 

17 606, the provisions of paragraphs (1), (2), and (3) of this 

18 subsection shall apply in the case of class II, group II sub19 stances. 

20 ‘‘(1) IN GENERAL.—The Administrator shall pro21 mulgate initial regulations not later than 18 months 

22 after the date of enactment of this section, and revised 

23 regulations any time thereafter, which establish a 

24 schedule for phasing down the consumption (and, if 

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1 duction) of class II, group II substances that is more 

2 stringent than the schedule set forth in this section if, 

3 based on the availability of substitutes, the Adminis4 trator determines that such more stringent schedule is 

5 practicable, taking into account technological 

6 achievability, safety, and other factors the Adminis7 trator deems relevant, or if the Montreal Protocol, or 

8 any applicable international agreement to which the 

9 United States is a party or otherwise adheres, is 

10 modified or established to include a schedule or other 

11 requirements to control or reduce production, con12 sumption, or use of any class II, group II substance 

13 more rapidly than the applicable schedule under this 

14 section. 

15 ‘‘(2) PETITION.—Any person may submit a peti16 tion to promulgate regulations under this subsection 

17 in the same manner and subject to the same proce18 dures as are provided in section 606(b). 

19 ‘‘(3) INCONSISTENCY.—If the Administrator de20 termines that the provisions of this section regarding 

21 banking, allowance rollover, or destruction offset cred22 its create a significant potential for inconsistency 

23 with the requirements of any applicable international 

24 agreement to which the United States is a party or 

25 otherwise adheres, the Administrator may promulgate 


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1 regulations restricting the availability of banking, al2 lowance rollover, or destruction offset credits to the ex3 tent necessary to avoid such inconsistency. 

4 ‘‘(h) EXCHANGE.—Section 607 shall not apply in the 

5 case of class II, group II substances. Production and con6 sumption allowances for class II, group II substances may 

7 be freely exchanged or sold but may not be converted into 

8 allowances for class II, group I substances. 

9 ‘‘(i) LABELING.—(1) In applying section 611 to prod10 ucts containing or manufactured with class II, group II 

11 substances, in lieu of the words ‘destroying ozone in the 

12 upper atmosphere’ on labels required under section 611 

13 there shall be substituted the words ‘contributing to global 

14 warming’. 

15 ‘‘(2) The Administrator may, through rulemaking, ex16 empt from the requirements of section 611 products con17 taining or manufactured with class II, group II substances 

18 determined to have little or no carbon dioxide equivalent 

19 value compared to other substances used in similar prod20 ucts. 

21 ‘‘(j) NONESSENTIAL PRODUCTS.—For the purposes of 

22 section 610, class II, group II substances shall be regulated 

23 under section 610(b), except that in applying section 610(b) 

24 the word ‘hydrofluorocarbon’ shall be substituted for the 

25 word ‘chlorofluorocarbon’ and the term ‘class II, group II’ 


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1 shall be substituted for the term ‘class I’. Class II, group 

2 II substances shall not be subject to the provisions of section 

3 610(d). 

4 ‘‘(k) INTERNATIONAL TRANSFERS.—In the case of class 

5 II, group II substances, in lieu of section 616, this sub6 section shall apply. To the extent consistent with any appli7 cable international agreement to which the United States 

8 is a party or otherwise adheres, including any amendment 

9 to the Montreal Protocol, the United States may engage in 

10 transfers with other parties to such agreement or amend11 ment under the following conditions: 

12 ‘‘(1) The United States may transfer production 

13 allowances to another party to such agreement or 

14 amendment if, at the time of the transfer, the Admin15 istrator establishes revised production limits for the 

16 United States accounting for the transfer in accord17 ance with regulations promulgated pursuant to this 

18 subsection. 

19 ‘‘(2) The United States may acquire production 

20 allowances from another party to such agreement or 

21 amendment if, at the time of the transfer, the Admin22 istrator finds that the other party has revised its do23 mestic production limits in the same manner as pro24 vided with respect to transfers by the United States 


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1 in the regulations promulgated pursuant to this sub2 section. 

3 ‘‘(l) RELATIONSHIP TO OTHER LAWS.— 

4 ‘‘(1) STATE LAWS.—For purposes of section 116, 

5 the requirements of this section for class II, group II 

6 substances shall be treated as requirements for the 

7 control and abatement of air pollution. 

8 ‘‘(2) MULTILATERAL AGREEMENTS.—Section 614 

9 shall apply to the provisions of this section con10 cerning class II, group II substances, except that for 

11 the words ‘Montreal Protocol’ there shall be sub12 stituted the words ‘Montreal Protocol, or any applica13 ble multilateral agreement to which the United States 

14 is a party or otherwise adheres that restricts the pro15 duction or consumption of class II, group II sub16 stances,’ and for the words ‘Article 4 of the Montreal 

17 Protocol’ there shall be substituted ‘any provision of 

18 such multilateral agreement regarding trade with 

19 non-parties’. 

20 ‘‘(3) FEDERAL FACILITIES.—For purposes of sec21 tion 118, the requirements of this section for class II, 

22 group II substances and corresponding State, inter23 state, and local requirements, administrative author24 ity, and process and sanctions shall be treated as reVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01638 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 quirements for the control and abatement of air pollu2 tion within the meaning of section 118. 

3 ‘‘(m) CARBON DIOXIDE EQUIVALENT VALUE.—(1) In 

4 lieu of section 602(e), the provisions of this subsection shall 

5 apply in the case of class II, group II substances. Simulta6 neously with establishing the list of class II, group II sub7 stances, and simultaneously with any addition to that list, 

8 the Administrator shall publish the carbon dioxide equiva9 lent value of each listed class II, group II substance, based 

10 on a determination of the number of metric tons of carbon 

11 dioxide that makes the same contribution to global warming 

12 over 100 years as 1 metric ton of each class II, group II 

13 substance. 

14 ‘‘(2) Not later than February 1, 2017, and not less 

15 than every 5 years thereafter, the Administrator shall— 

16 ‘‘(A) review, and if appropriate, revise the car17 bon dioxide equivalent values established for class II, 

18 group II substances based on a determination of the 

19 number of metric tons of carbon dioxide that makes 

20 the same contributions to global warming over 100 

21 years as 1 metric ton of each class II, group II sub22 stance; and 

23 ‘‘(B) publish in the Federal Register the results 

24 of that review and any revisions. 


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1 ‘‘(3) A revised determination published in the Federal 

2 Register under paragraph (2)(B) shall take effect for pro3 duction of class II, group II substances, consumption of 

4 class II, group II substances, and importation of products 

5 containing class II, group II substances starting on Janu6 ary 1 of the first calendar year starting at least 9 months 

7 after the date on which the revised determination was pub8 lished. 

9 ‘‘(4) The Administrator may decrease the frequency of 

10 review and revision under paragraph (2) if the Adminis11 trator determines that such decrease is appropriate in order 

12 to synchronize such review and revisions with any similar 

13 review process carried out pursuant to the United Nations 

14 Framework Convention on Climate Change, an agreement 

15 negotiated under that convention, The Vienna Convention 

16 for the Protection of the Ozone Layer, or an agreement nego17 tiated under that convention, except that in no event shall 

18 the Administrator carry out such review and revision any 

19 less frequently than every 10 years. 

20 ‘‘(n) REPORTING REQUIREMENTS.—In lieu of sub21 sections (b) and (c) of section 603, paragraphs (1) and (2) 

22 of this subsection shall apply in the case of class II, group 

23 II substances: 

24 ‘‘(1) IN GENERAL.—On a quarterly basis, or 

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1 mined by the Administrator, each person who pro2 duced, imported, or exported a class II, group II sub3 stance, or who imported a product containing a class 

4 II, group II substance, shall file a report with the Ad5 ministrator setting forth the carbon dioxide equiva6 lent amount of the substance that such person pro7 duced, imported, or exported, as well as the amount 

8 that was contained in products imported by that per9 son, during the preceding reporting period. Each such 

10 report shall be signed and attested by a responsible of11 ficer. If all other reporting is complete, no such report 

12 shall be required from a person after April 1 of the 

13 calendar year after such person permanently ceases 

14 production, importation, and exportation of the sub15 stance, as well as importation of products containing 

16 the substance, and so notifies the Administrator in 

17 writing. If the United States becomes a party or oth18 erwise adheres to a multilateral agreement, including 

19 any amendment to the Montreal Protocol on Sub20 stances That Deplete the Ozone Layer, that restricts 

21 the production or consumption of class II, group II 

22 substances, then, if all other reporting is complete, no 

23 such report shall be required from a person with re24 spect to importation from parties to such agreement 

25 or amendment of products containing any class II, 


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1 group II substance restricted by such agreement or 

2 amendment, after April 1 of the calendar year fol3 lowing the year during which such agreement or 

4 amendment enters into force. 

5 ‘‘(2) BASELINE REPORTS FOR CLASS II, GROUP II

6 SUBSTANCES.— 

7 ‘‘(A) IN GENERAL.—Unless such informa8 tion has been previously reported to the Admin9 istrator, on the date on which the first report 

10 under paragraph (1) of this subsection is re11 quired to be filed, each person who produced, im12 ported, or exported a class II, group II sub13 stance, or who imported a product containing a 

14 class II substance, (other than a substance added 

15 to the list of class II, group II substances after 

16 the publication of the initial list of such sub17 stances under this section), shall file a report 

18 with the Administrator setting forth the amount 

19 of such substance that such person produced, im20 ported, exported, or that was contained in prod21 ucts imported by that person, during each of cal22 endar years 2004, 2005, and 2006. 

23 ‘‘(B) PRODUCERS.—In reporting under sub24 paragraph (A), each person who produced in the 


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1 United States a class II substance during cal2 endar year 2004, 2005, or 2006 shall— 

3 ‘‘(i) report all acquisitions or pur4 chases of class II substances during each of 

5 calendar years 2004, 2005, and 2006 from 

6 all other persons who produced in the 

7 United States a class II substance during 

8 calendar year 2004, 2005, or 2006, and 

9 supply evidence of such acquisitions and 

10 purchases as deemed necessary by the Ad11 ministrator; and 

12 ‘‘(ii) report all transfers or sales of 

13 class II substances during each of calendar 

14 years 2004, 2005, and 2006 to all other per15 sons who produced in the United States a 

16 class II substance during calendar year 

17 2004, 2005, or 2006, and supply evidence of 

18 such transfers and sales as deemed nec19 essary by the Administrator. 

20 ‘‘(C) ADDED SUBSTANCES.—In the case of a 

21 substance added to the list of class II, group II 

22 substances after publication of the initial list of 

23 such substances under this section, each person 

24 who produced, imported, exported, or imported 

25 products containing such substance in calendar 


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1 year 2004, 2005, or 2006 shall file a report with 

2 the Administrator within 180 days after the date 

3 on which such substance is added to the list, set4 ting forth the amount of the substance that such 

5 person produced, imported, and exported, as well 

6 as the amount that was contained in products 

7 imported by that person, in calendar years 2004, 

8 2005, and 2006. 

9 ‘‘(o) STRATOSPHERIC OZONE AND CLIMATE PROTEC10 TION FUND.— 

11 ‘‘(1) IN GENERAL.—There is established in the 

12 Treasury of the United States a Stratospheric Ozone 

13 and Climate Protection Fund. 

14 ‘‘(2) DEPOSITS.—The Administrator shall de15 posit all proceeds from the auction and non-auction 

16 sale of allowances under this section into the Strato17 spheric Ozone and Climate Protection Fund. 

18 ‘‘(3) USE.—Amounts deposited into the Strato19 spheric Ozone and Climate Protection Fund shall be 

20 available, subject to appropriations, exclusively for 

21 the following purposes: 

22 ‘‘(A) RECOVERY, RECYCLING, AND RECLAMA23 TION.—The Administrator may use funds to es24 tablish a program to incentivize the recovery, re25 cycling, and reclamation of any Class II subVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01644 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 stances in order to reduce emissions of such sub2 stances. 

3 ‘‘(B) MULTILATERAL FUND.—If the United 

4 States becomes a party or otherwise adheres to a 

5 multilateral agreement, including any amend6 ment to the Montreal Protocol on Substances 

7 That Deplete the Ozone Layer, which restricts 

8 the production or consumption of class II, group 

9 II substances, the Administrator may use funds 

10 to meet any related contribution obligation of the 

11 United States to the Multilateral Fund for the 

12 Implementation of the Montreal Protocol or 

13 similar multilateral fund established under such 

14 multilateral agreement. 

15 ‘‘(C) BEST-IN-CLASS APPLIANCES DEPLOY16 MENT PROGRAM.—The Secretary of Energy may 

17 use funds to establish and carry out a program, 

18 to be known as the ‘Best-in-Class Appliances De19 ployment Program’— 

20 ‘‘(i) to provide bonus payments to re21 tailers or distributors for sales of best-in22 class high-efficiency household appliance 

23 models, high-efficiency installed building 

24 equipment, and high-efficiency consumer 

25 electronics, with the goals of— 


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1 ‘‘(I) accelerating the reduction in 

2 consumption of 

3 hydrochlorofluorocarbons (measured on 

4 a global warming potential-weighted 

5 basis); 

6 ‘‘(II) reducing life-cycle costs for 

7 consumers; 

8 ‘‘(III) encouraging innovation; 

9 and 

10 ‘‘(IV) maximizing energy savings 

11 and public benefit; 

12 ‘‘(ii) to provide bounties to retailers 

13 and manufacturers for the replacement, re14 tirement, and recycling of old, inefficient, 

15 and environmentally harmful products; and 

16 ‘‘(iii) to provide premium awards to 

17 manufacturers for developing and pro18 ducing new super-efficient best-in-class 

19 products. 

20 ‘‘(D) LOW GLOBAL WARMING PRODUCT

21 TRANSITION ASSISTANCE PROGRAM.— 

22 ‘‘(i) IN GENERAL.—The Administrator, 

23 in consultation with the Secretary of En24 ergy, may utilize funds in fiscal years 2012 

25 through 2022 to establish a program to proVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01646 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 vide financial assistance to manufacturers 

2 of products containing class II, group II 

3 substances to facilitate the transition to 

4 products that contain or utilize alternative 

5 substances with no or low carbon dioxide 

6 equivalent value and no ozone depletion po7 tential. 

8 ‘‘(ii) DEFINITION OF PRODUCTS.—In 

9 this subparagraph, the term ‘products’ 

10 means refrigerators, freezers, dehumidifiers, 

11 air conditioners, foam insulation, technical 

12 aerosols, fire protection systems, and semi13 conductors. 

14 ‘‘(iii) FINANCIAL ASSISTANCE.—The 

15 Administrator may provide financial assist16 ance to manufacturers pursuant to clause 

17 (i) for— 

18 ‘‘(I) the design and configuration 

19 of new products that use alternative 

20 substances with no or low carbon diox21 ide equivalent value and no ozone de22 pletion potential; and 

23 ‘‘(II) the redesign and retooling of 

24 facilities for the manufacture of prod25 ucts in the United States that use alVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01647 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ternative substances with no or low 

2 carbon dioxide equivalent value and no 

3 ozone depletion potential. 

4 ‘‘(iv) REPORTS.—For any fiscal year 

5 during which the Administrator provides fi6 nancial assistance pursuant to this sub7 paragraph, the Administrator shall submit 

8 a report to the Congress within 3 months of 

9 the end of such fiscal year detailing the 

10 amounts, recipients, specific purposes, and 

11 results of the financial assistance pro12 vided.’’. 

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

14 title VI of the Clean Air Act (42 U.S.C. 7671 et seq.) is 

15 amended by adding the following new item at the end there16 of: 

‘‘Sec. 619. Hydrofluorocarbons (HFCs).’’. 

17 (c) FIRE SUPPRESSION AGENTS.—Section 605(a) of 

18 the Clean Air Act (42 U.S.C. 7671(a)) is amended— 

19 (1) by striking ‘‘or’’ at the end of paragraph (2); 

20 (2) by striking the period at the end of para21 graph (3) and inserting ‘‘; or’’; and 

22 (3) by adding the following new paragraph after 

23 paragraph (3): 


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1 ‘‘(4) is listed as acceptable for use as a fire sup2 pression agent for nonresidential applications in ac3 cordance with section 612(c).’’. 

4 (d) MOTOR VEHICLE AIR CONDITIONERS.— 

5 (1) Section 609(e) of the Clean Air Act (42 

6 U.S.C. 7671h(e)) is amended by inserting ‘‘, group I’’ 

7 after each reference to ‘‘class II’’ in the text and head8 ing. 

9 (2) Section 609 of the Clean Air Act (42 U.S.C. 

10 7671h) is amended by adding the following new sub11 section after subsection (e): 

12 ‘‘(f) CLASS II, GROUP II SUBSTANCES.— 

13 ‘‘(1) REPAIR.—The Administrator may promul14 gate regulations establishing requirements for repair 

15 of motor vehicle air conditioners prior to adding a 

16 class II, group II substance. 

17 ‘‘(2) SMALL CONTAINERS.—(A) The Adminis18 trator may promulgate regulations establishing serv19 icing practices and procedures for recovery of class II, 

20 group II substances from containers which contain 

21 less than 20 pounds of such class II, group II sub22 stances. 

23 ‘‘(B) Not later than 18 months after enactment 

24 of this subsection, the Administrator shall either pro25 mulgate regulations requiring that containers which 


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1 contain less than 20 pounds of a class II, group II 

2 substance be equipped with a device or technology 

3 that limits refrigerant emissions and leaks from the 

4 container and limits refrigerant emissions and leaks 

5 during the transfer of refrigerant from the container 

6 to the motor vehicle air conditioner or issue a deter7 mination that such requirements are not necessary or 

8 appropriate. 

9 ‘‘(C) Not later than 18 months after enactment 

10 of this subsection, the Administrator shall promulgate 

11 regulations establishing requirements for consumer 

12 education materials on best practices associated with 

13 the use of containers which contain less than 20 

14 pounds of a class II, group II substance and prohib15 iting the sale or distribution, or offer for sale or dis16 tribution, of any class II, group II substance in any 

17 container which contains less than 20 pounds of such 

18 class II, group II substance, unless consumer edu19 cation materials consistent with such requirements 

20 are displayed and available at point-of-sale locations, 

21 provided to the consumer, or included in or on the 

22 packaging of the container which contain less than 20 

23 pounds of a class II, group II substance. 

24 ‘‘(D) The Administrator may, through rule25 making, extend the requirements established under 


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1 this paragraph to containers which contain 30 

2 pounds or less of a class II, group II substance if the 

3 Administrator determines that such action would 

4 produce significant environmental benefits. 

5 ‘‘(3) RESTRICTION OF SALES.—Effective Janu6 ary 1, 2014, no person may sell or distribute or offer 

7 to sell or distribute or otherwise introduce into inter8 state commerce any motor vehicle air conditioner re9 frigerant in any size container unless the substance 

10 has been found acceptable for use in a motor vehicle 

11 air conditioner under section 612.’’. 

12 (e) SAFE ALTERNATIVES POLICY.—Section 612(e) of 

13 the Clean Air Act (42 U.S.C. 7671k(e)) is amended by in14 serting ‘‘or class II’’ after each reference to ‘‘class I’’. 

15 SEC. 123. BLACK CARBON. 

16 (a) STUDY OF BLACK CARBON EMISSIONS.— 

17 (1) DEFINITION OF BLACK CARBON.—In this sub18 section, the term ‘‘black carbon’’ means any light-ab19 sorbing graphitic (or elemental) particle produced by 

20 incomplete combustion. 

21 (2) STUDY.—The Administrator, in consultation 

22 with the Secretary of Energy, the Secretary of State, 

23 and the heads of the National Oceanic and Atmos24 pheric Administration, the National Aeronautics and 

25 Space Administration, the United States Agency for 


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1 International Development, the National Institutes of 

2 Health, the Centers for Disease Control and Preven3 tion, National Institute of Standards and Technology, 

4 and other relevant Federal departments and agencies 

5 and representatives of appropriate industry and envi6 ronmental groups, shall conduct a 4-phase study of 

7 black carbon emissions, the phases of which shall be 

8 the following: 

9 (A) PHASE I–UNIVERSAL DEFINITION.—The 

10 Administrator shall conduct phase I of the study 

11 under this subsection to carry out measures to 

12 establish for the scientific community standard 

13 definitions of the terms— 

14 (i) black carbon; and 

15 (ii) organic carbon. 

16 (B) PHASE II–SOURCES AND TECH17 NOLOGIES.—The Administrator shall conduct 

18 phase II of the study under this subsection to 

19 summarize the available scientific and technical 

20 information concerning— 

21 (i) the identification of the major 

22 sources of black carbon emissions in the 

23 United States and throughout the world; 

24 (ii) an estimate of— 


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1 (I) the quantity of current and 

2 projected future black carbon emissions 

3 from those sources; and 

4 (II) the net climate effects of the 

5 emissions; 

6 (iii) the most recent scientific data rel7 evant to the public health- and climate-re8 lated impacts of black carbon emissions and 

9 associated emissions of organic carbon, ni10 trogen oxides, and sulfur oxides from the 

11 sources identified under clause (i); 

12 (iv) the most effective control strategies 

13 for additional domestic and international 

14 reductions in black carbon emissions, taking 

15 into consideration lifecycle analysis, cost-ef16 fectiveness, and the net climate impact of 

17 technologies, operations, and strategies, such 

18 as— 

19 (I) diesel particulate filters on ex20 isting diesel on- and off-road engines; 

21 and 

22 (II) particulate emission reduc23 tion measures for marine vessels; 

24 (v) carbon dioxide equivalency factors, 

25 global/regional modeling, or other metrics to 


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1 compare the global warming and other cli2 mate effects of black carbon emissions with 

3 carbon dioxide and other greenhouse gas 

4 emissions; and 

5 (vi) the health benefits associated with 

6 additional black carbon emission reduc7 tions. 

8 (C) PHASE III–INTERNATIONAL FUNDING.— 

9 The Administrator shall conduct phase III of the 

10 study under this subsection— 

11 (i) to summarize the amount, type, 

12 and direction of all actual and potential fi13 nancial, technical, and related assistance 

14 provided by the United States to foreign 

15 countries to reduce, mitigate, or otherwise 

16 abate— 

17 (I) black carbon emissions; and 

18 (II) any health, environmental, 

19 and economic impacts associated with 

20 those emissions; and 

21 (ii) to identify opportunities, including 

22 action under existing authority, to achieve 

23 significant black carbon emission reductions 

24 in foreign countries through the provision of 

25 technical assistance or other approaches. 


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1 (D) PHASE IV–RESEARCH AND DEVELOP2 MENT OPPORTUNITIES.—The Administrator shall 

3 conduct phase IV of the study under this sub4 section for the purpose of providing to Congress 

5 recommendations regarding— 

6 (i) areas of focus for additional re7 search for cost-effective technologies, oper8 ations, and strategies with the highest po9 tential to reduce black carbon emissions and 

10 protect public health in the United States 

11 and internationally; and 

12 (ii) actions that the Federal Govern13 ment could take to encourage or require ad14 ditional black carbon emission reductions. 

15 (3) REPORTS.—The Administrator shall submit 

16 to Congress— 

17 (A) by not later than 180 days after the 

18 date of enactment of this Act, a report describing 

19 the results of phases I and II of the study under 

20 subparagraphs (A) and (B) of paragraph (2); 

21 (B) by not later than 270 days after the 

22 date of enactment of this Act, a report describing 

23 the results of phase III of the study under para24 graph (2)(C); and 


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1 (C) by not later than 1 year after the date 

2 of enactment of this Act, a report describing the 

3 recommendations developed for phase IV of the 

4 study under paragraph (2)(D). 

5 (4) AUTHORIZATION OF APPROPRIATIONS.— 

6 There are authorized to be appropriated such sums as 

7 are necessary to carry out this subsection. 

8 (b) BLACK CARBON MITIGATION.—Title VIII of the 

9 Clean Air Act (as amended by section 113 of division A) 

10 is amended by adding at the end the following: 

11 ‘‘PART E—BLACK CARBON 

12 ‘‘SEC. 851. BLACK CARBON. 

13 ‘‘(a) DOMESTIC BLACK CARBON MITIGATION.— 

14 ‘‘(1) IN GENERAL.—Taking into consideration 

15 the public health and environmental impacts of black 

16 carbon emissions, including the effects on global and 

17 regional warming, the Arctic, and other snow and 

18 ice-covered surfaces, the Administrator shall— 

19 ‘‘(A) not later than 2 years after the date 

20 of enactment of this part, propose— 

21 ‘‘(i) regulations applicable to emissions 

22 of black carbon under the existing authori23 ties of this Act; or 

24 ‘‘(ii) a finding that existing regula25 tions promulgated pursuant to this Act adeVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01656 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 quately regulate black carbon emissions, 

2 which finding may be based on a finding 

3 that existing regulations, in the judgment of 

4 the Administrator— 

5 ‘‘(I) address those sources that 

6 both contribute significantly to the 

7 total emissions of black carbon and 

8 provide the greatest potential for sig9 nificant and cost-effective reductions in 

10 emissions of black carbon, under the 

11 existing authorities; and 

12 ‘‘(II) reflect the greatest degree of 

13 emission reduction achievable through 

14 application of technology that will be 

15 available for such sources, giving ap16 propriate consideration to cost, energy, 

17 and safety factors associated with the 

18 application of such technology; and 

19 ‘‘(B) not later than 3 years after the date 

20 of enactment of this part, promulgate final regu21 lations under the existing authorities of this Act 

22 or finalize the proposed finding. 

23 ‘‘(2) APPLICABILITY OF REGULATIONS.—Regula24 tions promulgated under paragraph (1) shall not 

25 apply to specific types, classes, categories, or other 


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1 suitable groupings of emission sources that the Ad2 ministrator finds are subject to adequate regulation. 

3 ‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There 

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

6 SEC. 124. STATES. 

7 Section 116 of the Clean Air Act (42 U.S.C. 7416) is 

8 amended by adding the following at the end thereof: ‘‘For 

9 the purposes of this section, the phrases ‘standard or limita10 tion respecting emissions of air pollutants’ and ‘require11 ments respecting control or abatement of air pollution’ shall 

12 include any provision to: limit greenhouse gas emissions, 

13 require surrender to the State or a political subdivision 

14 thereof of emission allowances or offset credits established 

15 or issued under this Act, and require the use of such allow16 ances or credits as a means of demonstrating compliance 

17 with requirements established by a State or political sub18 division thereof.’’. 

19 SEC. 125. STATE PROGRAMS. 

20 Title VIII of the Clean Air Act (as amended by section 

21 123(b)) is amended by adding at the end the following: 

22 ‘‘PART F—MISCELLANEOUS 

23 ‘‘SEC. 861. STATE PROGRAMS. 

24 ‘‘(a) IN GENERAL.—Notwithstanding section 116, if a 

25 Federal auction is conducted, by the deadline of March 31, 


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1 2011, as established in section 778, no State or political 

2 subdivision thereof shall implement or enforce a comprehen3 sive greenhouse gas emission limitation program that covers 

4 any capped emissions emitted during the years 2012 

5 through 2017. 

6 ‘‘(b) DEADLINE.—Notwithstanding section 116, in the 

7 event the March 31, 2011 auction is delayed, no State or 

8 political subdivision thereof shall enforce a comprehensive 

9 greenhouse gas emission limitation program that covers any 

10 capped emissions emitted during the period that commences 

11 at least 9 months after the date of the first auction as set 

12 out in section 778, through 2017. 

13 ‘‘(c) DEFINITION OF COMPREHENSIVE GREENHOUSE

14 GAS EMISSION LIMITATION PROGRAM.—For purposes of 

15 this section, the term ‘comprehensive greenhouse gas emis16 sion limitation program’ means a system of greenhouse gas 

17 regulation under which a State or political subdivision 

18 issues a limited number of tradable instruments in the na19 ture of emission allowances and requires that sources within 

20 its jurisdiction surrender such tradable instruments for 

21 each unit of greenhouse gases emitted during a compliance 

22 period. For purposes of this section, a ‘comprehensive green23 house gas emission limitation program’ does not include a 

24 target or limit on greenhouse gas emissions adopted by a 

25 State or political subdivision that is implemented other 


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1 than through the issuance and surrender of a limited num2 ber of tradable instruments in the nature of emission allow3 ances, nor does it include any other standard, limit, regula4 tion, or program to reduce greenhouse gas emissions that 

5 is not implemented through the issuance and surrender of 

6 a limited number of tradable instruments in the nature of 

7 emission allowances. For purposes of this section, the term 

8 ‘comprehensive greenhouse gas emission limitation pro9 gram’ does not include, among other things, fleet-wide 

10 motor vehicle emission requirements that allow greater 

11 emissions with increased vehicle production, or require12 ments that fuels, or other products, meet an average pollu13 tion emission rate or lifecycle greenhouse gas standard. 

14 ‘‘SEC. 862. GRANTS FOR SUPPORT OF AIR POLLUTION CON15 TROL PROGRAMS. 

16 ‘‘The Administrator is authorized to make grants to 

17 air pollution control agencies pursuant to section 105 for 

18 purposes of assisting in the implementation of programs to 

19 address global warming established under the Clean Energy 

20 Jobs and American Power Act. 

21 ‘‘SEC. 863. REDUCING ACID RAIN AND MERCURY POLLU22 TION. 

23 ‘‘(a) IN GENERAL.—Not later than 18 months after the 

24 date of enactment of this part, the Administrator shall sub25 mit to Congress a report that analyzes the effects of different 


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1 carbon dioxide reduction strategies and technologies on the 

2 emissions of mercury, sulfur dioxide, and nitrogen oxide, 

3 which cause acid rain, particulate matter, ground-level 

4 ozone, mercury contamination, and other environmental 

5 problems. 

6 ‘‘(b) INCLUSIONS.—The report under subsection (a) 

7 shall include— 

8 ‘‘(1) an assessment of a variety of carbon reduc9 tion technologies, including the application of various 

10 carbon capture and sequestration technologies for new 

11 and existing power plants; 

12 ‘‘(2) an assessment of the current scientific and 

13 technical understanding of the interplay between the 

14 various technologies and emissions of air pollutants; 

15 ‘‘(3) identification of hurdles to strategies that 

16 could cost-effectively reduce emissions of multiple pol17 lutants; and 

18 ‘‘(4) appropriate recommendations of the Admin19 istrator, if any.’’. 

20 SEC. 126. ENFORCEMENT. 

21 (a) REMAND.—Section 307(b) of the Clean Air Act (42 

22 U.S.C. 7607(b)) is amended by adding the following new 

23 paragraph at the end thereof: 

24 ‘‘(3) If the court determines that any action of 

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1 wise unlawful, the court may remand such action, 

2 without vacatur, if vacatur would impair or delay 

3 protection of the environment or public health or oth4 erwise undermine the timely achievement of the pur5 poses of this Act. 

6 ‘‘(4) If the court determines that any action of 

7 the Administrator is arbitrary, capricious, or other8 wise unlawful, and remands the matter to the Admin9 istrator, the Administrator shall complete final action 

10 on remand within an expeditious time period not 

11 longer than the time originally allowed for the action 

12 or 1 year, whichever is less, unless the court on mo13 tion determines that a shorter or longer period is nec14 essary, appropriate, and consistent with the purposes 

15 of this Act. The court of appeals shall have jurisdic16 tion to enforce a deadline for action on remand under 

17 this paragraph.’’. 

18 (b) PETITION FOR RECONSIDERATION.—Section 

19 307(d)(7)(B) of the Clean Air Act (42 U.S.C. 

20 7607(d)(7)(B)) is amended as follows: 

21 (1) By inserting after the second sentence ‘‘If a 

22 petition for reconsideration is filed, the Administrator 

23 shall take final action on such petition, including 

24 promulgation of final action either revising or deter25 mining not to revise the action for which reconsiderVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01662 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ation is sought, within 150 days after the petition is 

2 received by the Administrator or the petition shall be 

3 deemed denied for the purpose of judicial review.’’. 

4 (2) By amending the third sentence to read as 

5 follows: ‘‘Such person may seek judicial review of such 

6 denial, or of any other final action, by the Adminis7 trator, in response to a petition for reconsideration, 

8 in the United States court of appeals for the appro9 priate circuit (as provided in subsection (b)).’’. 

10 (c) PETITION FOR REVIEW.—Section 307(b)(1) of the 

11 Clean Air Act (42 U.S.C. 7607(b)(1)) is amended by insert12 ing after the second sentence the following: ‘‘Any person 

13 may file a petition for review of action by the Adminis14 trator as provided in this subsection.’’. 

15 SEC. 127. FORESTRY SECTOR GREENHOUSE GAS ACCOUNT16 ING. 

17 (a) IN GENERAL.—The Administrator, in consultation 

18 with the Secretary of Agriculture and the Secretary of the 

19 Interior, shall provide an annual accounting of sequestra20 tion and emissions of greenhouse gases from forests and for21 est products, including— 

22 (1) sequestration, including sequestration result23 ing from natural forest growth or other natural eco24 system processes, forest management practices, 

25 afforestation, or reforestation; 


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1 (2) emissions resulting from forest management 

2 practices, timber harvest, deforestation, or conversion 

3 between forest types or to cropland or other nonfor4 ested uses; and 

5 (3) transfers of carbon through forest products 

6 from the forest sector to other sectors, including the 

7 waste, manufacturing and milling, and energy sec8 tors. 

9 (b) SCALE OF ACCOUNTING.—Accounting under sub10 section (a) shall be provided, at a minimum, for— 

11 (1) Federal, other public, tribal, and private 

12 land of ownerships larger than 5,000 acres on which 

13 forestry is regularly practiced; and 

14 (2) any forest land on which conversion de15 scribed in subsection (a)(2) occurs. 

16 (c) BASIS OF ACCOUNTING.—Accounting under sub17 section (a) shall be based on information available from ex18 isting sources, including information— 

19 (1) collected for tax purposes; 

20 (2) from the Forest Inventory Analysis of the 

21 Forest Service; 

22 (3) collected for regulatory purposes; and 

23 (4) collected as part of standard industry prac24 tices, such as industry updates on inventories of tim25 ber. 


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1 (d) AUTHORITY OF ADMINISTRATOR.— 

2 (1) IN GENERAL.—Nothing in this section au3 thorizes the Administrator to require new generation 

4 of data by forest land owners. 

5 (2) NEED FOR ADDITIONAL INFORMATION.—If 

6 the Administrator determines that additional infor7 mation not available from current sources is nec8 essary to carry out the purposes of this section, the 

9 Administrator shall submit to Congress a report that 

10 describes the necessary information and new author11 ity that would be required to collect that information. 

12 SEC. 128. CONFORMING AMENDMENTS. 

13 (a) FEDERAL ENFORCEMENT.—Section 113 of the 

14 Clean Air Act (42 U.S.C. 7413) is amended as follows: 

15 (1) In subsection (a)(3), by striking ‘‘or title 

16 VI,’’ and inserting ‘‘title VI, title VII, or title VIII’’. 

17 (2) In subsection (b), by striking ‘‘or a major 

18 stationary source’’ and inserting ‘‘a major stationary 

19 source, or a covered EGU under title VIII’’ in the 

20 material preceding paragraph (1). 

21 (3) In paragraph (2) of subsection (b), by strik22 ing ‘‘or title VI’’ and inserting ‘‘title VI, title VII, or 

23 title VIII’’. 

24 (4) In subsection (c)— 


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1 (A) in the first sentence of paragraph (1), 

2 by striking ‘‘or title VI (relating to stratospheric 

3 ozone control),’’ and inserting ‘‘title VI, title VII, 

4 or title VIII,’’; and 

5 (B) in the first sentence of paragraph (3), 

6 by striking ‘‘or VI’’ and inserting ‘‘VI, VII, or 

7 VIII’’. 

8 (5) In subsection (d)(1)(B), by striking ‘‘or VI’’ 

9 and inserting ‘‘VI, VII, or VIII’’. 

10 (6) In subsection (f), in the first sentence, by 

11 striking ‘‘or VI’’ and inserting ‘‘VI, VII, or VIII’’. 

12 (b) RETENTION OF STATE AUTHORITY.—Section 116 

13 of the Clean Air Act (42 U.S.C. 7416) is amended as fol14 lows: 

15 (1) By striking ‘‘and 233’’ and inserting ‘‘233’’. 

16 (2) By striking ‘‘of moving sources)’’ and insert17 ing ‘‘of moving sources), and 861 (preempting certain 

18 State greenhouse gas programs for a limited time)’’. 

19 (c) INSPECTIONS, MONITORING, AND ENTRY.—Section 

20 114(a) of the Clean Air Act (42 U.S.C. 7414(a)) is amended 

21 by striking ‘‘section 112,’’ and all that follows through 

22 ‘‘(ii)’’ and inserting the following: ‘‘section 112, or any reg23 ulation of greenhouse gas emissions under title VII or VIII, 

24 (ii)’’. 


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1 (d) ENFORCEMENT.—Subsection (f) of section 304 of 

2 the Clean Air Act (42 U.S.C. 7604(f)) is amended as fol3 lows: 

4 (1) By striking ‘‘; or’’ at the end of paragraph 

5 (3) thereof and inserting a comma. 

6 (2) By striking the period at the end of para7 graph (4) thereof and inserting ‘‘, or’’. 

8 (3) By adding the following after paragraph (4) 

9 thereof: 

10 ‘‘(5) any requirement of title VII or VIII.’’. 

11 (e) ADMINISTRATIVE PROCEEDINGS AND JUDICIAL RE12 VIEW.—Section 307 of the Clean Air Act (42 U.S.C. 7607) 

13 is amended as follows: 

14 (1) In subsection (a), by striking ‘‘, or section 

15 306’’ and inserting ‘‘section 306, or title VII or VIII’’. 

16 (2) In subsection (b)(1)— 

17 (A) by striking ‘‘,,’’ and inserting ‘‘,’’ in 

18 each place such punctuation appears; and 

19 (B) by striking ‘‘section 120,’’ in the first 

20 sentence and inserting ‘‘section 120, any final 

21 action under title VII or VIII,’’. 

22 (3) In subsection (d)(1) by amending subpara23 graph (S) to read as follows: 

24 ‘‘(S) the promulgation or revision of any 

25 regulation under title VII or VIII,’’. 


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1 (f) TECHNICAL AMENDMENT.—Title IV of the Clean 

2 Air Act (relating to noise pollution) (42 U.S.C. 7641 et 

3 seq.)— 

4 (1) is amended by redesignating sections 401 

5 through 403 as sections 901 through 903, respectively; 

6 and 

7 (2) is redesignated as title IX and moved to ap8 pear at the end of that Act. 

9 (g) AMENDMENTS CLARIFYING REGULATION OF

10 GREENHOUSE GASES UNDER CLEAN AIR ACT.— 

11 (1) AIR QUALITY CRITERIA AND CONTROL TECH12 NIQUES.—Section 108(a) of the Clean Air Act (42 

13 U.S.C. 7408(a)) is amended by adding at the end the 

14 following: 

15 ‘‘(3) PROHIBITION ON LISTING OF GREENHOUSE

16 GASES.—On and after the date of enactment of this 

17 paragraph, the Administrator shall not include on the 

18 list of pollutants under this subsection any greenhouse 

19 gas on the basis of any effect the greenhouse gas may 

20 have on climate change.’’. 

21 (2) HAZARDOUS AIR POLLUTANTS.—Section 112 

22 of the Clean Air Act (42 U.S.C. 7412) is amended by 

23 adding at the end the following: 

24 ‘‘(20) GREENHOUSE GAS LIMITATION.—No green25 house gas may be added to the list of hazardous air 


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1 pollutants under this section unless the greenhouse gas 

2 meets the criteria described in subsection (b) inde3 pendent of the effects of the greenhouse gas on climate 

4 change.’’. 

5 (3) INTERNATIONAL AIR POLLUTION.—Section 

6 115(c) of the Clean Air Act (42 U.S.C. 7415(c)) is 

7 amended— 

8 (A) by striking ‘‘(c) This section’’ and in9 serting the following: 

10 ‘‘(3) APPLICABILITY.— 

11 ‘‘(A) FOREIGN COUNTRIES.—This section’’; 

12 and 

13 (B) by adding at the end the following: 

14 ‘‘(B) GREENHOUSE GASES.—This section 

15 does not apply to any greenhouse gas with re16 spect to the effects of the greenhouse gas on cli17 mate change.’’. 

18 (4) DEFINITION OF MAJOR EMITTING FACILITY.— 

19 Section 169(1) of the Clean Air Act (42 U.S.C. 

20 7479(1)) is amended— 

21 (A) in the first sentence, by inserting 

22 ‘‘(other than any greenhouse gas), or 25,000 tons 

23 per year of carbon dioxide equivalent for any 

24 greenhouse gas or combination of greenhouse 


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1 gases’’ after ‘‘one hundred tons per year or more 

2 of any air pollutant,’’; and 

3 (B) in the second sentence, by inserting 

4 ‘‘(other than any greenhouse gas), or 25,000 tons 

5 per year of carbon dioxide equivalent for any 

6 greenhouse gas or combination of greenhouse 

7 gases’’ after ‘‘two hundred fifty tons per year or 

8 more of any air pollutant’’. 

9 (5) PERMITS.—Title V of the Clean Air Act (42 

10 U.S.C. 7661 et seq.) is amended by adding at the end 

11 the following: 

12 ‘‘SEC. 508. EMISSIONS OF GREENHOUSE GASES. 

13 ‘‘Notwithstanding any provision of this title or title 

14 III, no stationary source shall be required to apply for, or 

15 operate pursuant to, a permit under this title solely because 

16 the stationary source, including an agricultural source, 

17 emits less than 25,000 tons per year of any greenhouse gas 

18 or combination of greenhouse gases that are regulated solely 

19 because of the effect of those gases on climate change.’’. 

20 (h) CONTAINERS OF CLASS I AND CLASS II SUB21 STANCES.—Section 608(c) of the Clean Air Act (42 U.S.C. 

22 7671g(c)) is amended by adding at the end the following: 

23 ‘‘(3) CONTAINERS OF CLASS I AND CLASS II SUB24 STANCES.— 


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1 ‘‘(A) DEFINITION OF REFILLABLE CON2 TAINER.—In this paragraph, the term ‘refillable 

3 container’ means a container that is designed to 

4 be refilled. 

5 ‘‘(B) REGULATIONS.—Not later than 2 

6 years after the date of enactment of this para7 graph, the Administrator shall revise regulations 

8 promulgated under this section to require that 

9 only a refillable container may be used to hold 

10 20 pounds or more of a class I substance or class 

11 II substance.’’. 

12 SEC. 129. DAVIS-BACON COMPLIANCE. 

13 (a) IN GENERAL.—Notwithstanding any other provi14 sion of law and in a manner consistent with other provi15 sions in this Act, to receive emission allowances or funding 

16 under this Act, or the amendments made by this Act, the 

17 recipient shall provide reasonable assurances that all labor18 ers and mechanics employed by contractors and subcontrac19 tors on projects funded directly by or assisted in whole or 

20 in part by and through the Federal Government pursuant 

21 to this Act, or the amendments made by this Act, or by 

22 any entity established in accordance with this Act, or the 

23 amendments made by this Act, including the Carbon Stor24 age Research Corporation, will be paid wages at rates not 

25 less than those prevailing on projects of a character similar 


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1 in the locality as determined by the Secretary of Labor in 

2 accordance with subchapter IV of chapter 31 of title 40, 

3 United States Code (commonly known as the ‘‘Davis-Bacon 

4 Act’’). With respect to the labor standards specified in this 

5 section, the Secretary of Labor shall have the authority and 

6 functions set forth in Reorganization Plan Numbered 14 of 

7 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 3145 of 

8 title 40, United States Code. 

9 (b) EXEMPTION.—Neither subsection (a) nor the re10 quirements of subchapter IV of chapter 31 of title 40, United 

11 States Code, shall apply to retrofitting of the following: 

12 (1) Single family homes (both attached and de13 tached) under section 164 of division A. 

14 (2) Owner-occupied residential units in larger 

15 buildings that have their own dedicated space-condi16 tioning systems under section 164 of division A. 

17 (3) Residential buildings (as defined in section 

18 164(a) of division A) if designed for residential use 

19 by less than 4 families. 

20 (4) Nonresidential buildings (as defined in sec21 tion 164(a) of division A) if the net interior space of 

22 such nonresidential building is less than 6,500 square 

23 feet. 


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1 Subtitle D—Carbon Market 

2 Assurance 

3 SEC. 131. CARBON MARKET ASSURANCE. 

4 It is the sense of the Senate that there shall be a single, 

5 integrated carbon market oversight program— 

6 (1) to provide for effective and comprehensive 

7 market oversight and enforcement; 

8 (2) to lower systemic risk and protect consumers; 

9 (3) to ensure market liquidity and allowance 

10 availability; 

11 (4) to enhance the price discovery function of 

12 such markets, ensuring that the price for emission al13 lowances and offset credits reflects the marginal cost 

14 of abatement; 

15 (5) to prevent excessive speculation that contrib16 utes to price volatility, including the establishment of 

17 robust aggregate position limits and margin require18 ments; 

19 (6) to ensure that market mechanisms and asso20 ciated oversight support the environmental integrity 

21 of the program established under title VII of the Clean 

22 Air Act (as added by section 101 of this division); 

23 (7) to establish provisions for market trans24 parency that provide authority, resources, and inforVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01673 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 mation needed to prevent fraud and manipulation in 

2 such markets; 

3 (8) to establish standards for trading as, and op4 eration of, trading facilities; 

5 (9) to ensure a well-functioning, well-regulated 

6 market, including a futures market, designed to man7 age risk and facilitate investment in emission reduc8 tions; 

9 (10) to establish clear, professional standards for 

10 dealers, traders, and other market participants; 

11 (11) to provide for appropriate criminal and 

12 civil penalties; and 

13 (12) to prevent any excessive leverage by market 

14 participants that creates risk to the economy. 

15 Subtitle E—Ensuring Real 

16 Reductions in Industrial Emissions 

17 SEC. 141. ENSURING REAL REDUCTIONS IN INDUSTRIAL 

18 EMISSIONS. 

19 Title VII of the Clean Air Act (as amended by section 

20 322 of division A) is amended by adding at the end the 

21 following: 

22 ‘‘PART F—ENSURING REAL REDUCTIONS IN 

23 INDUSTRIAL EMISSIONS 

24 ‘‘SEC. 761. PURPOSES. 

25 ‘‘The purposes of this part are— 


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1 ‘‘(1) to promote a strong global effort to signifi2 cantly reduce greenhouse gas emissions, and, through 

3 this global effort, stabilize greenhouse gas concentra4 tions in the atmosphere at a level that will prevent 

5 dangerous anthropogenic interference with the climate 

6 system; 

7 ‘‘(2) to prevent an increase in greenhouse gas 

8 emissions in countries other than the United States as 

9 a result of direct and indirect compliance costs in10 curred under this title; 

11 ‘‘(3) to provide a rebate to the owners and opera12 tors of entities in domestic eligible industrial sectors 

13 for their greenhouse gas emission costs incurred under 

14 this title, but not for costs associated with other re15 lated or unrelated market dynamics; 

16 ‘‘(4) to design such rebates in a way that will 

17 prevent carbon leakage while also rewarding innova18 tion and facility-level investments in energy efficiency 

19 performance improvements; and 

20 ‘‘(5) to eliminate or reduce distribution of emis21 sion allowances under this part when such distribu22 tion is no longer necessary to prevent carbon leakage 

23 from eligible industrial sectors. 

24 ‘‘SEC. 762. DEFINITIONS. 

25 ‘‘In this part: 


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1 ‘‘(1) CARBON LEAKAGE.—The term ‘carbon leak2 age’ means any substantial increase (as determined 

3 by the Administrator) in greenhouse gas emissions by 

4 industrial entities located in other countries if such 

5 increase is caused by an incremental cost of produc6 tion increase in the United States resulting from the 

7 implementation of this title. 

8 ‘‘(2) ELIGIBLE INDUSTRIAL SECTOR.—The term 

9 ‘eligible industrial sector’ means an industrial sector 

10 determined by the Administrator under section 763(b) 

11 to be eligible to receive emission allowance rebates 

12 under this part. 

13 ‘‘(3) INDUSTRIAL SECTOR.— 

14 ‘‘(A) IN GENERAL.—The term ‘industrial 

15 sector’ means any sector that— 

16 ‘‘(i) is in the manufacturing sector (as 

17 defined in NAICS codes 31, 32, and 33); or 

18 ‘‘(ii) is part of, or an entire, sector 

19 that beneficiates or otherwise processes (in20 cluding agglomeration) metal ores, includ21 ing iron and copper ores, soda ash, or phos22 phate. 

23 ‘‘(B) EXCLUSION.—The term ‘industrial 

24 sector’ does not include any part of a sector that 

25 extracts metal ores, soda ash, or phosphate. 


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1 ‘‘(4) NAICS.—The term ‘NAICS’ means the 

2 North American Industrial Classification System of 

3 2002. 

4 ‘‘(5) OUTPUT.—The term ‘output’ means the 

5 total tonnage or other standard unit of production (as 

6 determined by the Administrator) produced by an en7 tity in an industrial sector. The output of the cement 

8 sector is hydraulic cement, and not clinker. 

9 ‘‘SEC. 763. ELIGIBLE INDUSTRIAL SECTORS. 

10 ‘‘(a) LIST.— 

11 ‘‘(1) INITIAL LIST.—Not later than June 30, 

12 2011, the Administrator shall publish in the Federal 

13 Register a list of eligible industrial sectors pursuant 

14 to subsection (b). Such list shall include the amount 

15 of the emission allowance rebate per unit of produc16 tion that shall be provided to entities in each eligible 

17 industrial sector in the following two calendar years 

18 pursuant to section 764. 

19 ‘‘(2) SUBSEQUENT LISTS.—Not later than Feb20 ruary 1, 2013, and every 4 years thereafter, the Ad21 ministrator shall publish in the Federal Register an 

22 updated version of the list published under paragraph 

23 (1). 

24 ‘‘(b) ELIGIBLE INDUSTRIAL SECTORS.— 


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1 ‘‘(1) IN GENERAL.—Not later than June 30, 

2 2011, the Administrator shall promulgate a rule des3 ignating, based on the criteria under paragraph (2), 

4 the industrial sectors eligible for emission allowance 

5 rebates under this part. 

6 ‘‘(2) PRESUMPTIVELY ELIGIBLE INDUSTRIAL

7 SECTORS.— 

8 ‘‘(A) ELIGIBILITY CRITERIA.— 

9 ‘‘(i) IN GENERAL.—An owner or oper10 ator of an entity shall be eligible to receive 

11 emission allowance rebates under this part 

12 if such entity is in an industrial sector that 

13 is included in a six-digit classification of 

14 the NAICS that meets the criteria in both 

15 clauses (ii) and (iii), or the criteria in 

16 clause (iv). 

17 ‘‘(ii) ENERGY OR GREENHOUSE GAS

18 INTENSITY.—As determined by the Adminis19 trator, the industrial sector had— 

20 ‘‘(I) an energy intensity of at 

21 least 5 percent, calculated by dividing 

22 the cost of purchased electricity and 

23 fuel costs of the sector by the value of 

24 the shipments of the sector, based on 

25 data described in subparagraph (D); or 


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1 ‘‘(II) a greenhouse gas intensity of 

2 at least 5 percent, calculated by divid3 ing— 

4 ‘‘(aa) the number 20 multi5 plied by the number of tons of 

6 carbon dioxide equivalent green7 house gas emissions (including di8 rect emissions from fuel combus9 tion, process emissions, and indi10 rect emissions from the generation 

11 of electricity used to produce the 

12 output of the sector) of the sector 

13 based on data described in sub14 paragraph (D); by 

15 ‘‘(bb) the value of the ship16 ments of the sector, based on data 

17 described in subparagraph (D). 

18 ‘‘(iii) TRADE INTENSITY.—As deter19 mined by the Administrator, the industrial 

20 sector had a trade intensity of at least 15 

21 percent, calculated by dividing the value of 

22 the total imports and exports of such sector 

23 by the value of the shipments plus the value 

24 of imports of such sector, based on data de25 scribed in subparagraph (D). 


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1 ‘‘(iv) VERY HIGH ENERGY OR GREEN2 HOUSE GAS INTENSITY.—As determined by 

3 the Administrator, the industrial sector had 

4 an energy or greenhouse gas intensity, as 

5 calculated under clause (ii)(I) or (II), of at 

6 least 20 percent. 

7 ‘‘(B) METAL AND PHOSPHATE PRODUCTION

8 CLASSIFIED UNDER MORE THAN ONE NAICS

9 CODE.—For purposes of this section, the Admin10 istrator shall— 

11 ‘‘(i) aggregate data for the 

12 beneficiation or other processing (including 

13 agglomeration) of metal ores, including iron 

14 and copper ores, soda ash, or phosphate 

15 with subsequent steps in the process of metal 

16 and phosphate manufacturing, regardless of 

17 the NAICS code under which such activity 

18 is classified; and 

19 ‘‘(ii) aggregate data for the manufac20 turing of steel with the manufacturing of 

21 steel pipe and tube made from purchased 

22 steel in a nonintegrated process. 

23 ‘‘(C) EXCLUSION.—The petroleum refining 

24 sector shall not be an eligible industrial sector. 

25 ‘‘(D) DATA SOURCES.— 


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1 ‘‘(i) ELECTRICITY AND FUEL COSTS, 

2 VALUE OF SHIPMENTS.—The Administrator 

3 shall determine electricity and fuel costs 

4 and the value of shipments under this sub5 section from data from the United States 

6 Census Annual Survey of Manufacturers. 

7 The Administrator shall take the average of 

8 data from as many of the years of 2004, 

9 2005, and 2006 for which such data are 

10 available. If such data are unavailable, the 

11 Administrator shall make a determination 

12 based upon 2002 or 2006 data from the 

13 most detailed industrial classification level 

14 of Energy Information Agency’s Manufac15 turing Energy Consumption Survey (using 

16 2006 data if it is available) and the 2002 

17 or 2007 Economic Census of the United 

18 States (using 2007 data if it is available). 

19 If data from the Manufacturing Energy 

20 Consumption Survey or Economic Census 

21 are unavailable for any sector at the six22 digit classification level in the NAICS, then 

23 the Administrator may extrapolate the in24 formation necessary to determine the eligi25 bility of a sector under this paragraph from 


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1 available Manufacturing Energy Consump2 tion Survey or Economic Census data per3 taining to a broader industrial category 

4 classified in the NAICS. If data relating to 

5 the beneficiation or other processing (in6 cluding agglomeration) of metal ores, in7 cluding iron and copper ores, soda ash, or 

8 phosphate are not available from the speci9 fied data sources, the Administrator shall 

10 use the best available Federal or State gov11 ernment data and may use, to the extent 

12 necessary, representative data submitted by 

13 entities that perform such beneficiation or 

14 other processing (including agglomeration), 

15 in making a determination. Fuel cost data 

16 shall not include the cost of fuel used as 

17 feedstock by an industrial sector. 

18 ‘‘(ii) IMPORTS AND EXPORTS.—The 

19 Administrator shall base the value of im20 ports and exports under this subsection on 

21 United States International Trade Commis22 sion data. The Administrator shall take the 

23 average of data from as many of the years 

24 of 2004, 2005, and 2006 for which such 

25 data are available. If data from the United 


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1 States International Trade Commission are 

2 unavailable for any sector at the six-digit 

3 classification level in the NAICS, then the 

4 Administrator may extrapolate the informa5 tion necessary to determine the eligibility of 

6 a sector under this paragraph from avail7 able United States International Trade 

8 Commission data pertaining to a broader 

9 industrial category classified in the NAICS. 

10 ‘‘(iii) PERCENTAGES.—The Adminis11 trator shall round the energy intensity, 

12 greenhouse gas intensity, and trade inten13 sity percentages under subparagraph (A) to 

14 the nearest whole number. 

15 ‘‘(iv) GREENHOUSE GAS EMISSION

16 CALCULATIONS.—When calculating the tons 

17 of carbon dioxide equivalent greenhouse gas 

18 emissions for each sector under subpara19 graph (A)(ii)(II)(aa), the Administrator— 

20 ‘‘(I) shall use the best available 

21 data from as many of the years 2004, 

22 2005, and 2006 for which such data is 

23 available; and 

24 ‘‘(II) may, to the extent necessary 

25 with respect to a sector, use economic 


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1 and engineering models and the best 

2 available information on technology 

3 performance levels for such sector. 

4 ‘‘(3) ADMINISTRATIVE DETERMINATION OF ADDI5 TIONAL ELIGIBLE INDUSTRIAL SECTORS.— 

6 ‘‘(A) UPDATED TRADE INTENSITY DATA.— 

7 The Administrator shall designate as eligible to 

8 receive emission allowance rebates under this 

9 part an industrial sector that— 

10 ‘‘(i) met the energy or greenhouse gas 

11 intensity criteria in paragraph (2)(A)(ii) 

12 as of the date of promulgation of the rule 

13 under paragraph (1); and 

14 ‘‘(ii) meets the trade intensity criteria 

15 in paragraph (2)(A)(iii), using data from 

16 any year after 2006. 

17 ‘‘(B) INDIVIDUAL SHOWING PETITION.— 

18 ‘‘(i) PETITION.—In addition to des19 ignation under paragraph (2) or subpara20 graph (A) of this paragraph, the owner or 

21 operator of an entity in an industrial sector 

22 may petition the Administrator to designate 

23 as eligible industrial sectors under this part 

24 an entity or a group of entities that— 


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1 ‘‘(I) represent a subsector of a six2 digit section of the NAICS code; and 

3 ‘‘(II) meet the eligibility criteria 

4 in both clauses (ii) and (iii) of para5 graph (2)(A), or the eligibility criteria 

6 in clause (iv) of paragraph (2)(A). 

7 ‘‘(ii) DATA.—In making a determina8 tion under this subparagraph, the Adminis9 trator shall consider data submitted by the 

10 petitioner that is specific to the entity, data 

11 solicited by the Administrator from other 

12 entities in the subsector, if such other enti13 ties exist, and data specified in paragraph 

14 (2)(D). 

15 ‘‘(iii) BASIS OF SUBSECTOR DETER16 MINATION.—The Administrator shall deter17 mine an entity or group of entities to be a 

18 subsector of a six-digit section of the NAICS 

19 code based only upon the products manufac20 tured and not the industrial process by 

21 which the products are manufactured, ex22 cept that the Administrator may determine 

23 an entity or group of entities that manufac24 ture a product from primarily virgin mate25 rial to be a separate subsector from another 


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1 entity or group of entities that manufacture 

2 the same product primarily from recycled 

3 material. 

4 ‘‘(iv) USE OF MOST RECENT DATA.—In 

5 determining whether to designate a sector or 

6 subsector as an eligible industrial sector 

7 under this subparagraph, the Administrator 

8 shall use the most recent data available 

9 from the sources described in paragraph 

10 (2)(D), rather than the data from the years 

11 specified in paragraph (2)(D), to determine 

12 the trade intensity of such sector or sub13 sector, but only for determining such trade 

14 intensity. 

15 ‘‘(v) FINAL ACTION.—The Adminis16 trator shall take final action on such peti17 tion no later than 6 months after the peti18 tion is received by the Administrator. 

19 ‘‘SEC. 764. DISTRIBUTION OF EMISSION ALLOWANCE RE20 BATES. 

21 ‘‘(a) DISTRIBUTION SCHEDULE.— 

22 ‘‘(1) IN GENERAL.—For each vintage year, the 

23 Administrator shall distribute pursuant to this sec24 tion emission allowances made available under sec25 tion 771(a)(5), not later than October 31 of the preVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01686 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ceding calendar year. The Administrator shall make 

2 such annual distributions to the owners and operators 

3 of each entity in an eligible industrial sector in the 

4 amount of emission allowances calculated under sub5 section (b), except that— 

6 ‘‘(A) for vintage years 2012 and 2013, the 

7 distribution for a covered entity shall be pursu8 ant to the entity’s indirect carbon factor as cal9 culated under subsection (b)(3); 

10 ‘‘(B) for vintage year 2026 and thereafter, 

11 the distribution shall be pursuant to the amount 

12 calculated under subsection (b) multiplied by, for 

13 a sector— 

14 ‘‘(i) 90 percent for vintage year 2026; 

15 ‘‘(ii) 80 percent for vintage year 2027; 

16 ‘‘(iii) 70 percent for vintage year 2028; 

17 ‘‘(iv) 60 percent for vintage year 2029; 

18 ‘‘(v) 50 percent for vintage year 2030; 

19 ‘‘(vi) 40 percent for vintage year 2031; 

20 ‘‘(vii) 30 percent for vintage year 

21 2032; 

22 ‘‘(viii) 20 percent for vintage year 

23 2033; 

24 ‘‘(ix) 10 percent for vintage year 2034; 

25 and 


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1 ‘‘(x) 0 percent for vintage year 2035 

2 and thereafter. 

3 ‘‘(2) NEWLY ELIGIBLE SECTORS.—In addition to 

4 receiving a distribution of emission allowances under 

5 this section in the first distribution occurring after an 

6 industrial sector is designated as eligible under sec7 tion 763(b)(3), the owner or operator of an entity in 

8 that eligible industrial sector may receive a prorated 

9 share of any emission allowances made available for 

10 distribution under this section that were not distrib11 uted for the year in which the petition for eligibility 

12 was granted under section 763(b)(3)(A). 

13 ‘‘(3) CESSATION OF QUALIFYING ACTIVITIES.—If, 

14 as determined by the Administrator, a facility is no 

15 longer in an eligible industrial sector designated 

16 under section 763— 

17 ‘‘(A) the Administrator shall not distribute 

18 emission allowances to the owner or operator of 

19 such facility under this section; and 

20 ‘‘(B) the owner or operator of such facility 

21 shall return to the Administrator all allowances 

22 that have been distributed to it for future vintage 

23 years and a pro-rated amount of allowances dis24 tributed to the facility under this section for the 

25 vintage year in which the facility ceases to be in 


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1 an eligible industrial sector designated under 

2 section 763. 

3 ‘‘(b) CALCULATION OF DIRECT AND INDIRECT CARBON

4 FACTORS.— 

5 ‘‘(1) IN GENERAL.— 

6 ‘‘(A) COVERED ENTITIES.—Except as pro7 vided in subsection (a), for covered entities that 

8 are in eligible industrial sectors, the amount of 

9 emission allowance rebates shall be based on the 

10 sum of the covered entity’s direct and indirect 

11 carbon factors. 

12 ‘‘(B) OTHER ELIGIBLE ENTITIES.—For en13 tities that are in eligible industrial sectors but 

14 are not covered entities, the amount of emission 

15 allowance rebates shall be based on the entity’s 

16 indirect carbon factor. 

17 ‘‘(C) NEW ENTITIES.—Not later than 2 

18 years after the date of enactment of this title, the 

19 Administrator shall issue regulations governing 

20 the distribution of emission allowance rebates for 

21 the first and second years of operation of a new 

22 entity in an eligible industrial sector. These reg23 ulations shall provide for— 


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1 ‘‘(i) the distribution of emission allow2 ance rebates to such entities based on com3 parable entities in the same sector; and 

4 ‘‘(ii) an adjustment in the third and 

5 fourth years of operation to reconcile the 

6 total amount of emission allowance rebates 

7 received during the first and second years of 

8 operation to the amount the entity would 

9 have received during the first and second 

10 years of operation had the appropriate data 

11 been available. 

12 ‘‘(2) DIRECT CARBON FACTOR.—The direct car13 bon factor for a covered entity for a vintage year is 

14 the product of— 

15 ‘‘(A) the average annual output of the cov16 ered entity for the 2 years preceding the year of 

17 the distribution; and 

18 ‘‘(B) the most recent calculation of the aver19 age direct greenhouse gas emissions (expressed in 

20 tons of carbon dioxide equivalent) per unit of 

21 output for all covered entities in the sector, as 

22 determined by the Administrator under para23 graph (4). 

24 ‘‘(3) INDIRECT CARBON FACTOR.— 


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1 ‘‘(A) IN GENERAL.—The indirect carbon 

2 factor for an entity for a vintage year is the 

3 product obtained by multiplying the average an4 nual output of the entity for the 2 years pre5 ceding the year of the distribution by both the 

6 electricity emissions intensity factor determined 

7 pursuant to subparagraph (B) and the electricity 

8 efficiency factor determined pursuant to sub9 paragraph (C) for the year concerned. 

10 ‘‘(B) ELECTRICITY EMISSIONS INTENSITY

11 FACTOR.— 

12 ‘‘(i) IN GENERAL.—Each person selling 

13 electricity to the owner or operator of an 

14 entity in any sector designated as an eligi15 ble industrial sector under section 763(b) 

16 shall provide the owner or operator of the 

17 entity and the Administrator, on an annual 

18 basis, the electricity emissions intensity fac19 tor for the entity. The electricity emissions 

20 intensity factor for the entity, expressed in 

21 tons of carbon dioxide equivalents per kilo22 watt hour, is determined by dividing— 

23 ‘‘(I) the annual sum of the hourly 

24 product of— 


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1 ‘‘(aa) the electricity pur2 chased by the entity from that 

3 person in each hour (expressed in 

4 kilowatt hours); multiplied by 

5 ‘‘(bb) the marginal or weight6 ed average tons of carbon dioxide 

7 equivalent per kilowatt hour that 

8 are reflected in the electricity 

9 charges to the entity, as deter10 mined by the entity’s retail rate 

11 arrangements; by 

12 ‘‘(II) the total kilowatt hours of 

13 electricity purchased by the entity from 

14 that person during that year. 

15 ‘‘(ii) USE OF OTHER DATA TO DETER16 MINE FACTOR.—Where it is not possible to 

17 determine the precise electricity emissions 

18 intensity factor for an entity using the 

19 methodology in clause (i), the person selling 

20 electricity shall use the monthly average 

21 data reported by the Energy Information 

22 Administration or collected and reported by 

23 the Administrator for the utility serving the 

24 entity to determine the electricity emissions 

25 intensity factor. 


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1 ‘‘(C) ELECTRICITY EFFICIENCY FACTOR.— 

2 The electricity efficiency factor is the average 

3 amount of electricity (in kilowatt hours) used 

4 per unit of output for all entities in the relevant 

5 sector, as determined by the Administrator based 

6 on the best available data, including data pro7 vided under paragraph (6). 

8 ‘‘(D) INDIRECT CARBON FACTOR REDUC9 TION.—If an electricity provider received a free 

10 allocation of emission allowances pursuant to 

11 section 771(a)(1), the Administrator shall adjust 

12 the indirect carbon factor to avoid rebates to the 

13 eligible entity for costs that the Administrator 

14 determines were not incurred by the eligible enti15 ty because the allowances were freely allocated to 

16 the eligible entity’s electricity provider and used 

17 for the benefit of industrial consumers. 

18 ‘‘(4) GREENHOUSE GAS INTENSITY CALCULA19 TIONS.—The Administrator shall calculate the aver20 age direct greenhouse gas emissions (expressed in tons 

21 of carbon dioxide equivalent) per unit of output and 

22 the electricity efficiency factor for all covered entities 

23 in each eligible industrial sector every 4 years, using 

24 an average of the 5 most recent years of the best 

25 available data, from up to 7 years prior to the year 


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1 in which such calculations are made. For the purpose 

2 of determining sector averages that are representative 

3 of typical market conditions during the previous 7 

4 years of operations, such averages shall exclude data 

5 from individual years with the highest and the lowest 

6 direct greenhouse gas emissions per unit of output 

7 and electricity efficiency factors. For purposes of the 

8 lists required to be published not later than February 

9 1, 2013, the Administrator shall use the best available 

10 data for the maximum number of years, up to 5 

11 years, for which data are available. 

12 ‘‘(5) DETERMINATION OF SECTORS FOR PUR13 POSES OF SECTORAL AVERAGES.— 

14 ‘‘(A) IN GENERAL.—Notwithstanding the 

15 criteria used to determine eligible sectors under 

16 paragraphs (2) and (3)(C), not later than June 

17 30, 2011, the Administrator shall, by rule, iden18 tify sectors or subsectors for purposes of calcu19 lating sector averages under paragraphs (2)(B), 

20 (3)(C), and (4), based upon, to the extent prac21 ticable in achieving the purposes of this part— 

22 ‘‘(i) product produced; 

23 ‘‘(ii) process employed, including dis24 tinctions based upon the extent of integra25 tion or exclusion of process steps; and 


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1 ‘‘(iii) the extent of use of combined 

2 heat and power technologies. 

3 ‘‘(B) CONSIDERATION OF CRITERIA.—In de4 termining what entities are comparable to a new 

5 entity under paragraph (1)(C)(i), the Adminis6 trator shall consider, to the extent practicable, 

7 the criteria set forth in subparagraph (A). 

8 ‘‘(6) ENSURING EFFICIENCY IMPROVEMENTS.— 

9 When making greenhouse gas calculations, the Admin10 istrator shall— 

11 ‘‘(A) limit the average direct greenhouse gas 

12 emissions per unit of output, calculated under 

13 paragraph (4), for any eligible industrial sector 

14 to an amount that is not greater than it was in 

15 any previous calculation under this subsection; 

16 ‘‘(B) limit the electricity emissions intensity 

17 factor, calculated under paragraph (3)(B) and 

18 resulting from a change in electricity supply, for 

19 any entity to an amount that is not greater than 

20 it was during any previous year; and 

21 ‘‘(C) limit the electricity efficiency factor, 

22 calculated under paragraph (3)(C), for any eligi23 ble industrial sector to an amount that is not 

24 greater than it was in any previous calculation 

25 under this subsection. 


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1 ‘‘(7) DATA SOURCES.—For the purposes of this 

2 subsection— 

3 ‘‘(A) the Administrator shall use data from 

4 the greenhouse gas registry established under sec5 tion 713, where that data is available; and 

6 ‘‘(B) each owner or operator of an entity in 

7 an eligible industrial sector and each depart8 ment, agency, and instrumentality of the United 

9 States shall provide the Administrator with such 

10 information as the Administrator finds necessary 

11 to determine the direct carbon factor and the in12 direct carbon factor for each entity subject to this 

13 section. 

14 ‘‘(c) TOTAL MAXIMUM DISTRIBUTION.—Notwith15 standing subsections (a) and (b), the Administrator shall 

16 not distribute more allowances for any vintage year pursu17 ant to this section than are allocated for use under this part 

18 pursuant to section 765 for that vintage year. For any vin19 tage year for which the total emission allowance rebates cal20 culated pursuant to this section exceed the number of allow21 ances allocated pursuant to section 765, the Administrator 

22 shall reduce each entity’s distribution on a pro rata basis 

23 so that the total distribution under this section equals the 

24 number of allowances allocated under section 765. 


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1 ‘‘(d) IRON AND STEEL SECTOR.—For purposes of this 

2 section, the Administrator shall consider as in different in3 dustrial sectors— 

4 ‘‘(1) entities using integrated iron and 

5 steelmaking technologies (including coke ovens, blast 

6 furnaces, and other iron-making technologies); and 

7 ‘‘(2) entities using electric arc furnace tech8 nologies. 

9 ‘‘(e) METAL, SODA ASH, OR PHOSPHATE PRODUCTION

10 CLASSIFIED UNDER MORE THAN ONE NAICS CODE.—For 

11 purposes of this section, the Administrator shall not aggre12 gate data for the beneficiation or other processing (includ13 ing agglomeration) of metal ores, soda ash, or phosphate 

14 with subsequent steps in the process of metal, soda ash, or 

15 phosphate manufacturing. The Administrator shall consider 

16 the beneficiation or other processing (including agglomer17 ation) of metal ores, soda ash, or phosphate to be in sepa18 rate industrial sectors from the metal, soda ash, or phos19 phate manufacturing sectors. Industrial sectors that bene20 ficiate or otherwise process (including agglomeration) metal 

21 ores, soda ash, or phosphate shall not receive emission al22 lowance rebates under this section related to the activity 

23 of extracting metal ores, soda ash, or phosphate. 

24 ‘‘(f) COMBINED HEAT AND POWER.—For purposes of 

25 this section, and to achieve the purpose set forth in section 


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1 761(4),(the Administrator may consider entities to be in 

2 different industrial sectors or otherwise take into account 

3 the differences among entities in the same industrial sector, 

4 based upon the extent to which such entities use combined 

5 heat and power technologies. 

6 ‘‘SEC. 765. INTERNATIONAL TRADE. 

7 ‘‘It is the sense of the Senate that this Act will contain 

8 a trade title that will include a border measure that is con9 sistent with our international obligations and designed to 

10 work in conjunction with provisions that allocate allow11 ances to energy-intensive and trade-exposed industries.’’. 

12 TITLE II—PROGRAM 

13 ALLOCATIONS 

14 SEC. 201. DISTRIBUTION OF ALLOWANCES FOR INVEST15 MENT IN CLEAN VEHICLES. 

16 (a) DEFINITIONS.—In this section: 

17 (1) ADVANCED TECHNOLOGY VEHICLE.—The 

18 term ‘‘advanced technology vehicle’’ means any light19 duty vehicle assembled in the United States that 

20 meets— 

21 (A) the Tier II Bin 5 emission standard es22 tablished by regulations promulgated by the Ad23 ministrator pursuant to section 202(i) of the 

24 Clean Air Act (42 U.S. C. 7521(i)), or a lower25 numbered Bin emission standard; 


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1 (B) any new emission standard for fine 

2 particulate matter established by the Adminis3 trator under that Act (42 U.S.C. 7401 et seq.); 

4 and 

5 (C) a target fuel economy equal to or great6 er than 115 percent of the base model year target 

7 fuel economy for a vehicle of the same type and 

8 footprint, calculated on an energy-equivalent 

9 basis for vehicles other than advanced diesel 

10 light-duty motor vehicles. 

11 (2) BASE MODEL YEAR.—The term ‘‘base model 

12 year’’ means the model year 4 model years prior to 

13 the model year during which an advanced technology 

14 vehicle is initially certified for sale in the United 

15 States under part 86 of title 40, Code of Federal Reg16 ulations (as in effect on the date of enactment of this 

17 Act). 

18 (3) ENGINEERING INTEGRATION COST.—The 

19 term ‘‘engineering integration cost’’ includes the cost 

20 of engineering tasks performed in the United States 

21 relating to— 

22 (A) incorporating qualifying components 

23 into the design of advanced technology vehicles; 

24 and 


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1 (B) designing new tooling and equipment 

2 for production facilities that produce, in the 

3 United States, qualifying components or ad4 vanced technology vehicles. 

5 (4) QUALIFYING COMPONENT.—The term ‘‘quali6 fying component’’ means a component that the Sec7 retary of Energy determines to be— 

8 (A) specially designed for advanced tech9 nology vehicles; 

10 (B) installed for the purpose of meeting the 

11 performance requirements of advanced technology 

12 vehicles as specified in subparagraphs (A), (B), 

13 and (C) of paragraph (1); and 

14 (C) manufactured in the United States. 

15 (5) TARGET FUEL ECONOMY.—The term ‘‘target 

16 fuel economy’’ means— 

17 (A) for a vehicle classified as a passenger 

18 automobile pursuant to section 523.4 of title 49, 

19 Code of Federal Regulations (as in effect on the 

20 date of enactment of this Act), the value of Ti, 

21 representing the fuel economy target in the for22 mula displayed as Figure 1, calculated for that 

23 vehicle in a given model year pursuant to section 

24 531.5(c) of title 49, Code of Federal Regulations 


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1 (as in effect on the date of enactment of this 

2 Act); and 

3 (B) for a vehicle classified as a light truck 

4 pursuant to section 523.5 of title 49, Code of 

5 Federal Regulations (as in effect on the date of 

6 enactment of this Act), the value of Ti, rep7 resenting the fuel economy target in the formula 

8 displayed as Figure 1, calculated for that vehicle 

9 in a given model year pursuant to section 

10 533.5(a) of title 49, Code of Federal Regulations 

11 (as in effect on the date of enactment of this 

12 Act). 

13 (b) ESTABLISHMENT OF FUND.—There is established 

14 in the Treasury a separate account, to be known as the 

15 ‘‘Clean Vehicle Technology Fund’’. 

16 (c) AUCTION.—The Administrator shall— 

17 (1) auction the quantity of emission allowances 

18 allocated pursuant to section 771(b)(3) of the Clean 

19 Air Act pursuant to section 778 of that Act; and 

20 (2) deposit funds received from the auction in 

21 the Clean Vehicle Technology Fund. 

22 (d) GRANTS.—The Administrator shall distribute 

23 amounts allocated pursuant to section 771(a)(8) of the 

24 Clean Air Act, at the direction of the Secretary of Energy, 

25 to provide facility conversion funding grants to vehicle 


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1 manufacturers and component suppliers to pay the costs 

2 of— 

3 (1) reequipping or expanding an existing manu4 facturing facility in the United States to produce— 

5 (A) qualifying advanced technology vehicles; 

6 (B) plug-in electric drive or hybrid-electric, 

7 hybrid hydraulic, plug-in hybrid, electric, and 

8 fuel cell drive medium- and heavy-duty motor 

9 vehicles (including transit vehicles); or 

10 (C) qualifying components; and 

11 (2) engineering integration, performed in the 

12 United States, of qualifying vehicles and qualifying 

13 components that are produced in the United States. 

14 (e) PERIOD OF AVAILABILITY.—A grant provided 

15 under subsection (d) may be used for— 

16 (1) facilities and equipment placed in service 

17 after the date of enactment of this Act; and 

18 (2) engineering integration costs incurred after 

19 the date of enactment of this Act. 

20 (f) LIMITATIONS.— 

21 (1) PLUG-IN ELECTRIC DRIVE VEHICLES.—Not 

22 less than 25 percent of the funds provided under sub23 section (d) shall be used for— 

24 (A) reequipping or expanding facilities in 

25 the United States to produce plug-in electric 


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1 drive vehicles or qualifying components for those 

2 vehicles; or 

3 (B) engineering integration, performed in 

4 the United States, relating to those vehicles and 

5 components that are produced in the United 

6 States. 

7 (2) CAFE REQUIREMENTS.—No grant shall be 

8 provided under subsection (d) to an automobile man9 ufacturer that, directly or through a parent, sub10 sidiary, or affiliated entity, is not in compliance with 

11 each applicable corporate average fuel standard under 

12 section 32902 of title 49, United States Code, as in 

13 effect on the date on which the grant is provided. 

14 (g) AVAILABILITY OF AUCTION PROCEEDS.— 

15 (1) BLACK CARBON REDUCTION GRANT PRO16 GRAM.—Not less than 75 percent of the proceeds of the 

17 auction conducted pursuant to subsection (c) shall be 

18 used for providing grants under section 795A of the 

19 Energy Policy Act of 2005. 

20 (2) OTHER ASSISTANCE.—Not less than 20 per21 cent of the proceeds of the auction conducted pursuant 

22 to subsection (c) shall be available to the Adminis23 trator to provide assistance for the deployment, inte24 gration, and use of advanced technology vehicles and 

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1 draulic, plug-in hybrid, electric, and fuel cell drive 

2 medium- and heavy-duty motor vehicles (including 

3 transit vehicles and over-road buses). 

4 (3) NATIONAL TRANSPORTATION LOW-EMISSION

5 ENERGY PLAN; PILOT PROGRAM.—Not less than 5 per6 cent of the proceeds of the auction conducted pursuant 

7 to subsection (c) shall be available to the Secretary of 

8 Energy to carry out subsection (h). 

9 (h) NATIONAL TRANSPORTATION LOW-EMISSION EN10 ERGY PLAN; PILOT PROGRAM.— 

11 (1) NATIONAL TRANSPORTATION LOW-EMISSION

12 ENERGY PLAN.—Using the amounts described in sub13 section (g)(3), the Secretary of Energy shall develop 

14 a national transportation low-emission energy plan 

15 that— 

16 (A) projects the near- and long-term need 

17 for and location of electric drive vehicle refueling 

18 infrastructure at strategic locations across all 

19 major national highways, roads, and corridors; 

20 (B) identifies infrastructure and standard21 ization needs for electricity providers, infrastruc22 ture providers, vehicle manufacturers, and elec23 tricity purchasers; 


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1 (C) establishes an aspirational goal of 

2 achieving strategic deployment of electric vehicle 

3 infrastructure by January 1, 2020; 

4 (D) prioritizes the development of— 

5 (i) standardized public charge access 

6 ports with wireless or smart card billing ca7 pability; and 

8 (ii) level I and level II charge port sys9 tems (that charge an electric vehicle over a 

10 period of 8 to 14 hours and 4 to 8 hours, 

11 respectively) that will meet the energy re12 quirements of the majority of plug-in hy13 brid and battery electric vehicles; 

14 (E) examines the feasibility of level III 

15 charge port systems that can charge an electric 

16 vehicle over a period of 10 to 20 minutes; 

17 (F) focuses on infrastructure that provides 

18 consumers with the lowest cost while providing 

19 convenient charge system access; and 

20 (G) is developed by the Secretary, with the 

21 involvement of all relevant stakeholders. 

22 (2) ELECTRIC DRIVE DEMONSTRATION

23 PROJECTS.— 


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1 (A) IN GENERAL.—The Secretary shall es2 tablish pilot projects to demonstrate electric drive 

3 vehicles and infrastructure. 

4 (B) REQUIREMENTS.—The Secretary 

5 shall— 

6 (i) establish the pilot projects described 

7 in subparagraph (A) after publication of 

8 the plan developed under paragraph (1); 

9 (ii) use that plan to determine which 

10 regions of the United States are most ready 

11 to demonstrate electric vehicle infrastruc12 ture; 

13 (iii) carry out the pilot projects in dif14 ferent regions of the United States; and 

15 (iv) ensure that— 

16 (I) at least 1 pilot project is car17 ried out in a rural region of the 

18 United States; and 

19 (II) at least 1 pilot project is fo20 cused on freight issues. 

21 (3) FINANCIAL RESOURCES.—In carrying out the 

22 pilot projects under paragraph (2), the Secretary 

23 shall coordinate the use of appropriate financial in24 centives, grant programs, and other Federal financial 

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1 ery entities are able to participate in the pilot 

2 projects. 

3 (4) LEEP COORDINATOR.—The Secretary may 

4 designate 1 full-time position within the Department 

5 of Transportation, to be known as the ‘‘LEEP coordi6 nator’’, with responsibility to oversee— 

7 (A) the development of the plan under para8 graph (1); and 

9 (B) the implementation of the pilot projects 

10 under paragraph (2). 

11 (i) DIESEL EMISSIONS REDUCTION.— 

12 (1) DEFINITION OF ELIGIBLE ENTITY.—Section 

13 791(3) of the Energy Policy Act of 2005 (42 U.S.C. 

14 16131(3)) is amended— 

15 (A) in subparagraph (A), by striking ‘‘and’’ 

16 after the semicolon at the end; 

17 (B) in subparagraph (B), by striking the 

18 period at the end and inserting ‘‘; and’’; and 

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

20 ‘‘(C) any person that is the owner of record 

21 of a diesel fleet.’’. 

22 (2) USE OF FUNDS.—Section 792(d) of the En23 ergy Policy Act of 2005 (42 U.S.C. 16132(d)) is 

24 amended— 

25 (A) by striking paragraph (2); 


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1 (B) by striking ‘‘FUNDS.—’’ and all that 

2 follows through ‘‘An eligible entity’’ and insert3 ing ‘‘FUNDS.—An eligible entity’’; 

4 (C) by redesignating subparagraphs (A) 

5 and (B), clauses (i) through (v), and subclauses 

6 (I) through (V) as paragraphs (1) and (2), sub7 paragraphs (A) through (E), and clauses (i) 

8 through (v), respectively, and indenting appro9 priately; and 

10 (D) in paragraph (2) (as so redesignated), 

11 by striking ‘‘subparagraph (A)’’ and inserting 

12 ‘‘paragraph (1)’’. 

13 (3) BLACK CARBON REDUCTION GRANT PRO14 GRAM.—Subtitle G of title VII of the Energy Policy 

15 Act of 2005 is amended by inserting after section 795 

16 (42 U.S.C. 16135) the following: 

17 ‘‘SEC. 795A. BLACK CARBON REDUCTION GRANT PROGRAM. 

18 ‘‘(a) DEFINITIONS.—In this section: 

19 ‘‘(1) ADMINISTRATOR.—The term ‘Adminis20 trator’ means the Administrator of the Environ21 mental Protection Agency. 

22 ‘‘(2) BLACK CARBON.—The term ‘black carbon’ 

23 means a primary light-absorbing aerosol, as deter24 mined by the Administrator based on the best avail25 able science. 


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1 ‘‘(3) DIESEL PARTICULATE FILTER.—The term 

2 ‘diesel particulate filter’ means a pollution control 

3 technology that reduces at least 85 percent of black 

4 carbon, as verified by the Administrator or the Cali5 fornia Air Resources Board. 

6 ‘‘(4) ELIGIBLE ENTITY.—The term ‘eligible enti7 ty’ means a person that is the owner of record of a 

8 heavy duty vehicle. 

9 ‘‘(5) HEAVY DUTY VEHICLE.—The term ‘heavy 

10 duty vehicle’ has the meaning given the term in sec11 tion 202(b)(3) of the Clean Air Act (42 U.S.C. 

12 7521(b)(3)). 

13 ‘‘(6) PROGRAM.—The term ‘program’ means the 

14 Black Carbon Reduction Program established under 

15 this section. 

16 ‘‘(b) ESTABLISHMENT.—The Administrator shall es17 tablish a voluntary grant program, to be known as the 

18 ‘Black Carbon Reduction Program’— 

19 ‘‘(1) to cost effectively mitigate the adverse con20 sequences of global warming by means of early action 

21 to reduce black carbon emissions from diesel-powered 

22 heavy-duty vehicles placed in service prior to 2007; 

23 and 

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1 gated under subsection (g)), shall authorize the provi2 sion of grants in accordance with subsection (c) to 

3 cover 100 percent of the cost of purchasing and in4 stalling diesel particulate filters on heavy duty vehi5 cles. 

6 ‘‘(c) PROGRAM SPECIFICATIONS.— 

7 ‘‘(1) IN GENERAL.—A grant may be issued under 

8 the program only to cover the costs of the purchase 

9 and installation of a diesel particulate filter. 

10 ‘‘(2) MAXIMUM AMOUNT.—The total amount of 

11 grants issued for a fiscal year under the program 

12 may not exceed the amounts made available for the 

13 program for the fiscal year under subsection (h). 

14 ‘‘(d) EVALUATION AND REPORT.— 

15 ‘‘(1) IN GENERAL.—Not later than 2 years after 

16 the date of enactment of this section and biennially 

17 thereafter, the Administrator shall submit to Congress 

18 a report evaluating the implementation of the pro19 gram. 

20 ‘‘(2) INCLUSIONS.—The report shall include a 

21 description of— 

22 ‘‘(A) the total number of grant applications 

23 received; 

24 ‘‘(B) the total dollar value of all grants 

25 issued; 


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1 ‘‘(C) the estimated benefits of grants pro2 vided under the program, including estimates of 

3 the total number of tons of black carbon reduced, 

4 cost-effectiveness, and cost-benefits; and 

5 ‘‘(D) any other information the Adminis6 trator considers to be appropriate. 

7 ‘‘(e) EXCLUSION OF GRANTS FROM INCOME.—A grant 

8 issued under the program shall not be considered gross in9 come of the purchaser of technology for purposes of the In10 ternal Revenue Code of 1986. 

11 ‘‘(f) EFFECT OF SECTION.—Nothing in this section af12 fects any authority under the Clean Air Act (42 U.S.C. 

13 7401 et seq.) as in existence on the day before the date of 

14 enactment of this section. 

15 ‘‘(g) REGULATIONS.— 

16 ‘‘(1) IN GENERAL.—As soon as practicable after 

17 the date of enactment of this section, the Adminis18 trator shall promulgate regulations to implement the 

19 program. 

20 ‘‘(2) REQUIREMENTS.—The regulations promul21 gated under paragraph (1) shall— 

22 ‘‘(A) establish streamlined procedures for 

23 the provision of grants to eligible entities partici24 pating in the program for the amount of the 

25 purchase and installation of diesel particulate 


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1 filters as soon as practicable, but not later than 

2 30 days after the date of submission of an appli3 cation for a grant; 

4 ‘‘(B) include a list of diesel particulate fil5 ters the purchase and installation of which are 

6 eligible to be funded through the program; and 

7 ‘‘(C) include a list of vehicles by model year 

8 that are eligible to be retrofitted under the pro9 gram. 

10 ‘‘(h) FUNDING.—The Administrator shall use to carry 

11 out the program all of the funding provided for each fiscal 

12 year under section 201(g)(1) of division B of the Clean En13 ergy Jobs and American Power Act.’’. 

14 (4) AUTHORIZATION OF APPROPRIATIONS.—Sec15 tion 797 of the Energy Policy Act of 2005 (42 U.S.C. 

16 16137) is amended by striking ‘‘2011’’ and inserting 

17 ‘‘2021’’. 

18 SEC. 202. STATE AND LOCAL INVESTMENT IN ENERGY EFFI19 CIENCY AND RENEWABLE ENERGY. 

20 (a) DEFINITIONS.—For purposes of this section: 

21 (1) ALLOWANCE.—The term ‘‘allowance’’ means 

22 an emission allowance established under section 721 

23 of the Clean Air Act. 

24 (2) INDIAN TRIBE.—The term ‘‘Indian tribe’’ has 

25 the meaning given the term in section 4 of the Indian 


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1 Self-Determination and Education Assistance Act (25 

2 U.S.C. 450b). 

3 (3) VINTAGE YEAR.—The term ‘‘vintage year’’ 

4 has the meaning given the term in section 700 of the 

5 Clean Air Act. 

6 (b) DISTRIBUTION AMONG INDIAN TRIBES, STATES, 

7 LOCAL GOVERNMENTS, AND RENEWABLE ELECTRICITY

8 PROGRAMS.—The Administrator shall, in accordance with 

9 this section, distribute allowances allocated pursuant to sec10 tion 771(a)(9) of the Clean Air Act for the following vintage 

11 year. The Administrator, after consultation with the Sec12 retary of the Interior, shall distribute not less than 1 per13 cent and not more than 3 percent of such allowances to In14 dian tribes. The Administrator, after consultation with the 

15 Secretary of Energy, shall distribute the remaining allow16 ances among the States, local governments, and renewable 

17 electricity programs under this section each year in accord18 ance with the following formula: 

19 (1) 60 percent of the allowances shall be provided 

20 to the States, of which— 

21 (A) 30 percent shall be divided equally 

22 among the States; 

23 (B) 30 percent shall be distributed on a pro 

24 rata basis among the States based on the popu25 lation of each State, as contained in the most reVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01713 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 cent reliable census data available from the Bu2 reau of the Census for all States at the time at 

3 which the Administrator calculates the formula 

4 for distribution; 

5 (C) 30 percent shall be distributed on a pro 

6 rata basis among the States on the basis of the 

7 energy consumption of each State, as contained 

8 in the most recent State Energy Data Report 

9 available from the Energy Information Adminis10 tration (or such alternative reliable source as the 

11 Administrator may designate); and 

12 (D) 10 percentage shall be provided to the 

13 States based on an energy-efficiency formula de14 veloped by the Administrator, which formula 

15 shall be— 

16 (i) based on— 

17 (I) weather-adjusted criteria; and 

18 (II) performance-based metrics 

19 that measure each State’s success at de20 creasing energy consumption or in21 creasing energy efficiency— 

22 (aa) on a per capita basis in 

23 the residential sector; 


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1 (bb) on an energy consump2 tion per square-foot basis in the 

3 commercial sector; and 

4 (cc) on the basis of installed 

5 energy efficiency measures that 

6 save energy, measured on a per 

7 capita basis for the residential 

8 sector and a per square foot basis 

9 for the commercial sector; and 

10 (ii) updated every 3 years. 

11 (2) 25 percent of the allowances shall be provided 

12 to local governments for energy conservation and effi13 ciency grants. 

14 (3) 15 percent of the allowances shall be provided 

15 in accordance with subsection (c)(3) to renewable en16 ergy producers exclusively for the generation of renew17 able electricity, from facilities that— 

18 (A) have a capacity of 10 megawatts or 

19 greater; and 

20 (B) are placed in service after the date of 

21 enactment of this Act. 

22 (c) USES.—The allowances distributed to each State 

23 and local government pursuant to this section shall be used 

24 exclusively in accordance with the following requirements: 


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1 (1) ALLOCATION TO STATES.—Allowances allo2 cated to the States under subsection (b)(1) shall be for 

3 the following purposes and be used in accordance with 

4 the following conditions: 

5 (A) PURPOSES.— 

6 (i) ENERGY EFFICIENCY PROGRAMS.— 

7 (I) IN GENERAL.—Subject to sub8 clauses (II), (III), and (IV), not less 

9 than 40 percent of the amount made 

10 available under subsection (b)(1) shall 

11 be used exclusively for— 

12 (aa) implementation and en13 forcement of building codes; 

14 (bb) implementation of the 

15 energy-efficient manufactured 

16 homes program; 

17 (cc) implementation of build18 ing energy performance labeling; 

19 (dd) low-income community 

20 energy efficiency programs, in21 cluding those administered by pri22 vate, nonprofit community devel23 opment organizations providing 

24 technical and financial assistance 

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1 ing those owned by women and 

2 minorities) that improve energy 

3 efficiency and create jobs and 

4 business opportunities; 

5 (ee) thermal energy effi6 ciency; 

7 (ff) retrofit for energy and 

8 environmental performance; and 

9 (gg) cost-effective energy effi10 ciency programs for end-use con11 sumers of electricity, natural gas, 

12 home heating oil, or propane, in13 cluding, where appropriate, pro14 grams or mechanisms adminis15 tered by local governments and 

16 entities other than the State. 

17 (II) THERMAL ENERGY EFFI18 CIENCY.— 

19 (aa) IN GENERAL.—Not less 

20 than 10 percent of the amount 

21 made available under subclause 

22 (I) shall be used for thermal en23 ergy efficiency projects that pro24 vide district thermal energy 

25 through a network of pipes from 1 


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1 or more central plants to at least 

2 2 or more buildings, combined 

3 heat and power that produces elec4 tricity and thermal energy with a 

5 minimum 60 percent overall effi6 ciency on a lower-heating value 

7 basis, or recoverable waste energy 

8 (including mechanical, thermal, 

9 or electrical energy) that, if not 

10 for recovery, would be wasted and 

11 may be recovered or generated 

12 through modification of an exist13 ing facility or addition of a new 

14 facility. 

15 (bb) STUDIES, CONSTRUC16 TION, AND DEVELOPMENT.—Allo17 cations under this subclause may 

18 be used for planning, engineering, 

19 and feasibility studies as well as 

20 project construction and develop21 ment. 

22 (III) REQUIREMENTS FOR THER23 MAL ENERGY EFFICIENCY PROJECTS.— 

24 Projects carried out under subclause 

25 (II) shall— 


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1 (aa) reduce or avoid green2 house gas emissions; and 

3 (bb)(AA) produce thermal en4 ergy from renewable energy re5 sources or natural cooling sources; 

6 (BB) capture and produc7 tively use thermal energy from an 

8 electric generation facility; 

9 (CC) integrate new electricity 

10 generation into an existing dis11 trict energy system; 

12 (DD) capture and produc13 tively uses surplus thermal energy 

14 from an industrial or municipal 

15 process (such as wastewater treat16 ment); or 

17 (EE) distribute and transfer 

18 to buildings the thermal energy 

19 from the energy sources described 

20 in subitems (AA) through (DD). 

21 (IV) RETROFIT FOR ENERGY AND

22 ENVIRONMENTAL PERFORMANCE.—Not 

23 less than 5 percent of the amount made 

24 available under subclause (I) shall be 

25 used for the program for retrofit for enVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01719 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 ergy and environmental performance 

2 under section 164. 

3 (V) PRIORITY.—In carrying out 

4 this section, each State shall give pri5 ority to persons of low and moderate 

6 income (as defined in section 102(a) of 

7 the Housing and Community Develop8 ment Act of 1974 (42 U.S.C. 5302(a))). 

9 (VI) PERSONS OF LOW INCOME.— 

10 Each State shall use at least 35 per11 cent of the allocations provided pursu12 ant to this clause to benefit persons of 

13 low income (as defined in section 

14 102(a) of the Housing and Community 

15 Development Act of 1974 (42 U.S.C. 

16 5302(a))), using not less than 20 per17 cent of such amount made available 

18 under this clause for energy retrofits 

19 and green investments in subsidized 

20 housing based on standards to ensure 

21 that investments are cost-effective— 

22 (aa) taking into account re23 ductions in future use of energy 

24 and other utilities, and the extent 

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1 ments address repair and replace2 ment needs that may otherwise 

3 need to be addressed with other 

4 forms of assistance; and 

5 (bb) on the condition that, to 

6 receive such funding, the recipient 

7 shall commit to an additional pe8 riod of affordability of not fewer 

9 than 15 years, covering all units 

10 for which the grants and loans are 

11 used. 

12 (ii) RENEWABLE ENERGY PRO13 GRAMS.—Renewable energy programs for 

14 capital grants, production incentives, loans, 

15 loan guarantees, forgivable loans, direct 

16 provision of allowances, and interest rate 

17 buy-downs for— 

18 (I) re-equipping, expanding, or 

19 establishing a manufacturing facility 

20 that receives certification from the Sec21 retary of Energy pursuant to section 

22 48C of the Internal Revenue Code of 

23 1986 for the production of— 


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1 (aa) property designed to be 

2 used to produce energy from re3 newable energy sources; and 

4 (bb) electricity storage sys5 tems; 

6 (II) deployment of a diverse range 

7 of technologies to generate electricity 

8 from renewable energy sources; and 

9 (III) deployment of a diverse 

10 range of facilities or equipment, such 

11 as solar panels, to generate electricity 

12 or thermal energy from renewable en13 ergy resources in and on buildings in 

14 an urban environment. 

15 (iii) OTHER STATE USES.— 

16 (I) ELECTRICITY TRANS17 MISSION.—Improvement in electricity 

18 transmission for— 

19 (aa) State or regional imple20 mentation of electricity trans21 mission planning and siting ac22 tivities that facilitate renewable 

23 energy development, including fa24 cilitation of landowner negotia25 tions for transmission of right-ofVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01722 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 way leasing or other contractual 

2 arrangements; 

3 (bb) grants to nonprofit orga4 nizations that facilitate negotia5 tions for transmission right-of6 way leasing or other contractual 

7 agreements between affected land8 owners and developers; 

9 (cc) State or regional studies 

10 of renewable energy zones and re11 sources with insufficient trans12 mission capacity, including geo13 graphical identification of poten14 tial renewable energy sites, envi15 ronmental reviews, and land use 

16 or coastal zone constraints; 

17 (dd) grants to support land18 owner associations’ and other 

19 nonprofit organizations’ partici20 pation in State and Federal 

21 siting processes, including such 

22 associations’ studies of renewable 

23 energy feasibility and benefits and 

24 associated data collection; 


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1 (ee) grants to affected land2 owners or landowner associations 

3 or nonprofit organizations for 

4 mitigation of impacts on property 

5 or ecosystems due to transmission 

6 projects that are part of an inter7 connection-wide plan focused on 

8 facilitating renewable energy de9 velopment; 

10 (ff) training for State regu11 latory authority staff and local 

12 workforces relating to renewable 

13 energy generation resources and 

14 storage, smart grid, or new trans15 mission technologies; 

16 (gg) grants to transmission 

17 providers for transmission im18 provements (including smart grid 

19 investments) that facilitate renew20 able energy development and ben21 efit consumers; 

22 (hh) grants to transmission 

23 providers for security upgrades to 

24 the transmission system and au25 thorized uses under title XIII of 


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1 the Energy Independence and Se2 curity Act of 2007 (42 U.S.C. 

3 17381 et seq.); or 

4 (ii) grants to develop energy 

5 storage, reliability, or distributed 

6 renewable generation projects. 

7 (II) END-USE CONSUMER PRO8 GRAMS.—Cost-effective energy effi9 ciency programs for end-use consumers 

10 of electricity, natural gas, home heat11 ing oil, or propane, including, where 

12 appropriate, programs or mechanisms 

13 administered by local governments and 

14 entities other than the State. 

15 (III) SMART GRID.—Enabling the 

16 development of a Smart Grid (as de17 scribed in section 1301 of the Energy 

18 Independence and Security Act of 2007 

19 (42 U.S.C. 17381)) for State, local gov20 ernment, and other public buildings 

21 and facilities, including integration of 

22 renewable energy resources and distrib23 uted generation, demand response, de24 mand-side management, and systems 

25 analysis. 


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1 (iv) STATE ENERGY PROGRAM.—The 

2 energy program of the State authorized 

3 under part D of title III of the Energy Pol4 icy and Conservation Act (42 U.S.C. 6321 

5 et seq.). 

6 (v) WEATHERIZATION ASSISTANCE

7 PROGRAM.—For use in conjunction with the 

8 weatherization assistance program of the 

9 State authorized under part A of title IV of 

10 the Energy Conservation and Production 

11 Act (42 U.S.C. 6861 et seq.). 

12 (B) CONDITIONS.— 

13 (i) IN GENERAL.—The States shall 

14 prioritize expansion of existing energy effi15 ciency programs approved and overseen by 

16 the State or the appropriate State regu17 latory authority. 

18 (ii) SUPPLEMENTATION.—The States 

19 shall demonstrate that allowances allocated 

20 pursuant to subparagraph (A) have been 

21 used to supplement, and not to supplant, 

22 existing and otherwise available State, 

23 local, and ratepayer funding for such pur24 pose. 


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1 (2) ENERGY CONSERVATION AND EFFICIENCY.— 

2 Allowances allocated to local governments under sub3 section (b)(2) shall be used exclusively for energy con4 servation and efficiency purposes specified in subtitle 

5 E of the Energy Independence and Security Act of 

6 2007 (42 U.S.C. 17151 et seq.), on the condition that 

7 the allocation for the Secretary of Energy under sec8 tion 543 of that Act (42 U.S.C. 17153) is distributed 

9 on a pro-rata basis among the other eligible recipients 

10 under that section. 

11 (3) NATIONAL RENEWABLE ENERGY DEPLOYMENT

12 PROGRAM.— 

13 (A) IN GENERAL.—The Administrator, in 

14 consultation with the Secretary of Energy, shall 

15 distribute annually the allowances for renewable 

16 energy producers under subsection (b)(3)— 

17 (i) subject to subparagraph (D), in a 

18 quantity that, for each renewable energy fa19 cility, is equal to the product obtained by 

20 multiplying— 

21 (I) the quantity of energy gen22 erated by the renewable energy facility 

23 during the preceding vintage year; and 

24 (II) an incentive rate determined 

25 by the Administrator, in consultation 


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1 with the Secretary of Energy, before 

2 the renewable energy facility is placed 

3 in service; and 

4 (ii) for a period of 10 years after the 

5 date on which the renewable energy facility 

6 is placed in service. 

7 (B) IMPLEMENTATION.—The Administrator 

8 shall promulgate such regulations as are appro9 priate to carry out this paragraph. 

10 (C) TECHNOLOGY DIVERSITY.—Not later 

11 than 3 years after the date of enactment of this 

12 Act, the Administrator, in consultation with the 

13 Secretary of Energy— 

14 (i) shall review the programs enacted 

15 pursuant to this section to assess whether 

16 the programs are supporting the develop17 ment of a variety of renewable energy tech18 nologies; and 

19 (ii) may make adjustments to the pro20 grams to better support development of such 

21 a variety while continuing to maximize the 

22 quantity of renewable energy capacity de23 ployed. 

24 (D) DISTRIBUTION.—In a case in which 

25 there are an insufficient number of allowances to 


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1 serve all otherwise qualified projects placed in 

2 service based on the formula under subsection 

3 (A)(i), the Administrator shall distribute allow4 ances under this paragraph on a pro rata basis 

5 among all otherwise qualified projects. 

6 (d) REPORTING.—Each Indian tribe, State, local gov7 ernment, and renewable electricity generating company di8 rectly receiving allowances or allowance value under this 

9 section shall submit to the Administrator a report that con10 tains a list of entities receiving allowances or allowance 

11 value under this section. 

12 (e) ENFORCEMENT.—If the Administrator determines 

13 that an Indian tribe, State, local government, or renewable 

14 electricity generating company is not in compliance with 

15 this section, the Administrator may withhold up to twice 

16 the number of allowances or allowance value that the In17 dian tribe, State, local government, or renewable electricity 

18 generating company failed to use in accordance with the 

19 requirements of this section, that such Indian tribe, State, 

20 local government, or renewable electricity generating com21 panies would otherwise be eligible to receive under this sec22 tion in later years. Allowances withheld pursuant to this 

23 subsection shall be distributed among the remaining Indian 

24 tribes, States, local governments, and renewable electricity 

25 generating companies in accordance with subsection (b). 


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1 SEC. 203. ENERGY EFFICIENCY IN BUILDING CODES. 

2 The Administrator shall distribute emission allow3 ances allocated for the following vintage year pursuant to 

4 section 771(a)(10) of the Clean Air Act among the States 

5 in accordance with the formula described in section 202 of 

6 this division exclusively for the purpose of section 163 of 

7 division A. 

8 SEC. 204. ENERGY INNOVATION HUBS. 

9 (a) PURPOSE.—The Secretary shall carry out a pro10 gram in accordance with this section to establish Energy 

11 Innovation Hubs to enhance the economic, environmental, 

12 and energy security of the United States by promoting com13 mercial application of clean, indigenous energy alternatives 

14 to oil and other fossil fuels, reducing greenhouse gas emis15 sions, and ensuring that the United States maintains a 

16 technological lead in the development and commercial ap17 plication of state-of-the-art energy technologies. 

18 (b) DISTRIBUTION OF ALLOWANCES TO ENERGY INNO19 VATION HUBS.—The Secretary shall, in accordance with the 

20 requirements of this section, distribute to eligible consortia 

21 allowances allocated for the following vintage year under 

22 section 772(a)(11) of the Clean Air Act. 

23 SEC. 205. ARPA–E RESEARCH. 

24 (a) DEFINITIONS.—For purposes of this section: 


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1 (1) ALLOWANCE.—The term ‘‘allowance’’ means 

2 an emission allowance established under section 721 

3 of the Clean Air Act. 

4 (2) DIRECTOR.—The term ‘‘Director’’ means Di5 rector of the Advanced Research Projects Agency–En6 ergy. 

7 (b) DISTRIBUTION OF ALLOWANCES.—The Director, in 

8 accordance with this section, shall distribute allowances al9 located for the following vintage year under section 

10 771(a)(12) of the Clean Air Act. Such allowances shall be 

11 distributed on a competitive basis to institutions of higher 

12 education, companies, research foundations, trade and in13 dustry research collaborations, or consortia of such entities, 

14 or other appropriate research and development entities to 

15 achieve the goals of the Advanced Research Projects Agency16 Energy (as described in section 5012(c) of the America 

17 COMPETES Act (42 U.S.C. 16538(c))) through targeted 

18 acceleration of— 

19 (1) novel early-stage energy research with pos20 sible technology applications; 

21 (2) development of techniques, processes, and 

22 technologies, and related testing and evaluation; 

23 (3) development of manufacturing processes for 

24 technologies; and 


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1 (4) demonstration and coordination with non2 governmental entities for commercial applications of 

3 technologies and research applications. 

4 (c) SUPPLEMENT NOT SUPPLANT.—Assistance pro5 vided under this section shall be used to supplement, and 

6 not to supplant, any other Federal resources available to 

7 carry out activities described in this section. 

8 SEC. 206. INTERNATIONAL CLEAN ENERGY DEPLOYMENT 

9 PROGRAM. 

10 The Secretary of State shall distribute emission allow11 ances allocated for the following vintage year pursuant to 

12 section 771(a)(13) of the Clean Air Act exclusively for the 

13 purpose of section 323 of division A. 

14 SEC. 207. INTERNATIONAL CLIMATE CHANGE ADAPTATION 

15 AND GLOBAL SECURITY. 

16 The Secretary of State shall distribute emission allow17 ances allocated for the following vintage year pursuant to 

18 section 771(a)(14) of the Clean Air Act exclusively for the 

19 purpose of section 324 of division A. 

20 SEC. 208. ENERGY EFFICIENCY AND RENEWABLE ENERGY 

21 WORKER TRAINING. 

22 (a) ESTABLISHMENT OF FUND.—There is established 

23 in the Treasury a separate account, to be known as the ‘‘En24 ergy Efficiency and Renewable Energy Worker Training 

25 Fund’’. 


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1 (b) AUCTION PROCEEDS.—The Administrator shall de2 posit the proceeds of the auction conducted pursuant to sec3 tion 771(b)(4) of the Clean Air Act in the Energy Efficiency 

4 and Renewable Energy Worker Training Fund. 

5 (c) AVAILABILITY OF AMOUNTS.—The Secretary of 

6 Labor shall use the amounts deposited in the Energy Effi7 ciency and Renewable Energy Worker Training Fund 

8 under subsection (b) to carry out section 171(e)(8) of the 

9 Workforce Investment Act of 1998 (29 U.S.C. 2916(e)(8)) 

10 without further appropriation or fiscal year limitation. 

11 SEC. 209. WORKER TRANSITION. 

12 (a) ESTABLISHMENT OF FUND.—There is established 

13 in the Treasury a separate account, to be known as the 

14 ‘‘Worker Transition Fund’’. 

15 (b) AUCTION PROCEEDS.—The Administrator shall de16 posit the proceeds of the auction conducted pursuant to sec17 tion 771(b)(5) of the Clean Air Act in the Worker Transi18 tion Fund. 

19 (c) AVAILABILITY OF AMOUNTS.—The amounts depos20 ited in the Worker Transition Fund shall be used to carry 

21 out part 2 of subtitle A of title III of division A. 

22 SEC. 210. STATE PROGRAMS FOR GREENHOUSE GAS REDUC23 TION AND CLIMATE ADAPTATION. 

24 (a) DEFINITIONS.—In this section: 


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1 (1) ALASKA NATIVE VILLAGE.—The term ‘‘Alaska 

2 Native village’’ means a federally recognized Indian 

3 tribe located in the State of Alaska and listed in the 

4 Bureau of Indian Affairs publication entitled ‘‘In5 dian Entities Recognized and Eligible to Receive 

6 Services from the United States Bureau of Indian Af7 fairs’’ (74 Fed. Reg. 40218 (Aug. 11, 2009)). 

8 (2) ALLOWANCE.—The term ‘‘allowance’’ means 

9 an emission allowance established under section 721 

10 of the Clean Air Act. 

11 (3) INDIAN TRIBE.—The term ‘‘Indian tribe’’ has 

12 the meaning given the term in section 4 of the Indian 

13 Self-Determination and Education Assistance Act (25 

14 U.S.C. 450b). 

15 (4) SCCR ACCOUNT.—The term ‘‘SCCR Ac16 count’’ means a State Climate Change Response Ac17 count established under subsection (c)(5). 

18 (5) VINTAGE YEAR.—The term ‘‘vintage year’’ 

19 has the meaning given that term in section 700 of the 

20 Clean Air Act. 

21 (b) REGULATIONS; COORDINATION.— 

22 (1) REGULATIONS.—Not later than 2 years after 

23 the date of enactment of this Act, the Administrator, 

24 or the heads of such Federal agencies as the President 


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1 may designate, shall promulgate regulations to imple2 ment this section. 

3 (2) COORDINATION.—If the President designates 

4 more than 1 Federal agency to implement this sec5 tion, the President shall require such agencies to es6 tablish a memorandum of understanding providing 

7 for coordination of rulemaking and other imple8 menting activities, in accordance with this section. 

9 (c) DISTRIBUTION OF ALLOWANCES.— 

10 (1) IN GENERAL.—Not later than September 30 

11 of each calendar year, the Administrator shall dis12 tribute, in accordance with this section, allowances 

13 allocated for the following vintage year pursuant to 

14 section 771(a)(15) of the Clean Air Act. 

15 (2) RESERVATION AND ALLOCATION.—The Ad16 ministrator shall— 

17 (A) reserve 10 percent of the allowances de18 scribed in paragraph (1) for distribution among 

19 coastal and Great Lakes States in accordance 

20 with subsection (e); 

21 (B) reserve 10 percent of the allowances de22 scribed in paragraph (1) for distribution among 

23 the States for wildfire programs for the purposes 

24 described in subsection (f), with the allowances to 


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1 be deposited in and administered through the 

2 SCCR Accounts; 

3 (C) after consultation with the Secretary of 

4 the Interior, reserve at least 1 percent of the al5 lowances for distribution to Indian tribes in ac6 cordance with subsection (d); and 

7 (D) distribute the remaining allowances to 

8 fund State government programs for greenhouse 

9 gas reduction and climate adaptation pursuant 

10 to paragraphs (3) and (5), with the allowances 

11 to be deposited in and administered through the 

12 SCCR Accounts. 

13 (3) FORMULA FOR DISTRIBUTION.—The Admin14 istrator shall distribute the allowances pursuant to 

15 paragraph (2)(D) ratably among the States based on 

16 the product obtained by multiplying— 

17 (A) the population of a State; and 

18 (B) the allocation factor for the State deter19 mined under paragraph (4). 

20 (4) STATE ALLOCATION FACTORS.— 

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

22 subparagraph (B), the allocation factor for a 

23 State shall be the quotient obtained by divid24 ing— 


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1 (i) the per capita income of all indi2 viduals in the United States; by 

3 (ii) the per capita income of all indi4 viduals in the State. 

5 (B) LIMITATION.— 

6 (i) MAXIMUM.—If the allocation factor 

7 for a State as calculated under subpara8 graph (A) would exceed 1.2, the allocation 

9 factor for such State shall be 1.2. 

10 (ii) MINIMUM.—If the allocation factor 

11 for a State as calculated under subpara12 graph (A) would be less than 0.8, the alloca13 tion factor for such State shall be 0.8. 

14 (C) PER CAPITA INCOME.—For purposes of 

15 this paragraph, per capita income shall be— 

16 (i) determined at 2-year intervals; and 

17 (ii) subject to subparagraph (D), equal 

18 to the average of the annual per capita in19 comes for the most recent period of 3 con20 secutive years for which satisfactory data 

21 are available from the Department of Com22 merce at the time such determination is 

23 made. 


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1 (D) REVENUE DIRECTLY RESULTING FROM

2 A PRESIDENTIALLY DECLARED MAJOR DIS3 ASTER.— 

4 (i) IN GENERAL.—For purposes of this 

5 paragraph, per capita income from 1 or 

6 more of the sources described in clause (ii) 

7 shall be reduced or excluded if the Secretary 

8 of Commerce— 

9 (I) (in consultation with the Ad10 ministrator and the heads of the de11 partments or agencies involved) deter12 mines that the income accrues to per13 sons as the result of a major disaster 

14 designated by the President under the 

15 Robert T. Stafford Disaster Relief and 

16 Emergency Assistance Act (42 U.S.C. 

17 5121 et seq.); and 

18 (II) finds that the inclusion of 1 

19 or more of the income sources, in whole 

20 or in part, results in a transitory, 

21 rather than a sustainable, increase in 

22 a State’s per capita income level rel23 ative to the national average. 


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1 (ii) SOURCES OF INCOME.—The 

2 sources of income referred to in clause (i) 

3 are the following: 

4 (I) Property and casualty insur5 ance (including homeowners and rent6 ers insurance). 

7 (II) The National Flood Insur8 ance Program of the Federal Emer9 gency Management Agency. 

10 (III) The Individual and Family 

11 Grants Program of the Federal Emer12 gency Management Agency. 

13 (IV) The Disaster Housing Pro14 gram of the Federal Emergency Man15 agement Agency. 

16 (V) The Community Development 

17 Block Grant Program of the Depart18 ment of Housing and Urban Develop19 ment. 

20 (VI) The Disaster Unemployment 

21 Assistance Program of the Department 

22 of Labor. 

23 (VII) Any other source determined 

24 appropriate by the Administrator. 


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1 (5) STATE CLIMATE CHANGE RESPONSE AC2 COUNTS.— 

3 (A) ESTABLISHMENT.—Each State shall es4 tablish a State Climate Change Response Ac5 count, to be administered pursuant to State law, 

6 to receive and distribute— 

7 (i) the allocation of allowances pro8 vided under paragraph (2); or 

9 (ii) at the election of the State, the pro10 ceeds of the auction of those allowances. 

11 (B) COMPLIANCE.—State regulations and 

12 implementing procedures relating to SCCR ac13 counts shall require compliance with the provi14 sions of this section and all other applicable pro15 visions of Federal law. 

16 (d) DISTRIBUTION TO INDIAN TRIBES.— 

17 (1) IN GENERAL.—The Administrator, or the 

18 heads of such Federal agencies as the President may 

19 designate, shall promulgate regulations establishing a 

20 program to distribute allowances to Indian tribes, in 

21 accordance with the requirements of this section, of 

22 which not less than 18 percent shall be allocated to 

23 Alaska Native Villages for each year. 

24 (2) USE OF ALLOWANCES.—Allowances distrib25 uted to Indian tribes shall be used exclusively— 


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1 (A) in accordance with subsection (g); and 

2 (B) in compliance with any approved tribal 

3 climate change response plan. 

4 (e) DISTRIBUTION TO COASTAL AND GREAT LAKES

5 STATES.—The Administrator, or the heads of such other 

6 Federal agencies as the President may designate, shall dis7 tribute allowances for coastal State economic protection re8 served under subsection (c)(2)(A) each fiscal year, in ac9 cordance with section 384 of division A. 

10 (f) DISTRIBUTION TO STATES FOR FIRE PROGRAMS.— 

11 The Administrator, or the heads of such other Federal agen12 cies as the President may designate, shall distribute allow13 ances reserved under subsection (c)(2)(B), to the States’ 

14 SCCR Accounts for each fiscal year, to be used for wildfire 

15 programs in accordance with section 383 of division A. 

16 (g) USES OF ALLOWANCES DEPOSITED TO SCCR AC17 COUNTS.— 

18 (1) IN GENERAL.—States shall use allowances 

19 deposited to SCCR Accounts under subsection 

20 (c)(2)(D) exclusively for the development and imple21 mentation of projects, programs, or measures as de22 scribed in this section to address climate change by 

23 reducing emissions of greenhouse gases or by building 

24 resilience to the impacts of climate change, including 

25 impacts such as— 


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1 (A) extreme weather events, such as flooding 

2 and tropical cyclones; 

3 (B) more frequent heavy precipitation 

4 events; 

5 (C) water scarcity and adverse impacts on 

6 water quality; 

7 (D) stronger and longer heat waves; 

8 (E) more frequent and severe droughts; 

9 (F) rises in sea level; 

10 (G) ecosystem disruption; 

11 (H) increased wildfire risk; 

12 (I) increased air pollution; 

13 (J) effects on public health; 

14 (K) impaired transportation systems and 

15 infrastructure; and 

16 (L) reduced productivity of agricultural or 

17 ranching operations. 

18 (2) REQUIREMENTS.—The allowances received by 

19 each SCCR Account for each fiscal year shall be used 

20 by the State exclusively to fund the following cat21 egories of activities, in compliance with the provisions 

22 of approved State climate change response plans: 

23 (A) Grants to fund water system mitigation 

24 and adaptation partnerships in accordance with 

25 section 381 of division A. 


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1 (B) Flood control, protection, prevention 

2 and response programs and projects in accord3 ance with section 382 of division A. 

4 (C) Programs or projects implemented by 

5 State agencies as owners or operators of water 

6 systems to address any ongoing or forecasted cli7 mate-related impact on water quality, water 

8 supply or reliability, for 1 or more of the pur9 poses listed in section 381(d) of division A. 

10 (D) Programs or projects to reduce green11 house gas emissions through recycling or for in12 creasing recycling rates in accordance with sec13 tion 154 of division A. 

14 (E) Programs and projects addressing ad15 verse impacts of climate change affecting agri16 culture or ranching activities. 

17 (F) Programs or projects addressing air 

18 pollution or air quality impacts caused or exac19 erbated by climate change. 

20 (G) Programs or projects to reduce green21 house gas emissions that result in a decrease in 

22 emissions of other air pollutants. 

23 (H) Programs or projects to restore aban24 doned mine lands that increase carbon sequestra25 tion or reduce greenhouse gas emissions while 


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1 providing other benefits, including improvements 

2 in water and air quality. 

3 (I) Programs addressing the risk of 

4 wildfires for 1 or more of the purposes listed in 

5 section 383(e)(2) of division A. 

6 (3) DISTRIBUTION FOR LOCAL GOVERNMENTS.— 

7 Not less than 12.5 percent of the allowances deposited 

8 to SCCR Accounts shall be distributed by each State 

9 to units of local government within such State, to be 

10 used exclusively to support the categories of climate 

11 change response efforts listed in paragraph (2). 

12 (4) VULNERABLE POPULATIONS.—In deploying 

13 allowances under this section, States and units of 

14 local government shall ensure that programs and 

15 projects are funded responding to impacts affecting 

16 socially and economically vulnerable populations, in17 cluding— 

18 (A) persons of low-income (as defined in 

19 title I of the Housing and Community Develop20 ment Act of 1974, (42 U.S.C. 5301 et seq.)); 

21 (B) members of socially disadvantaged 

22 groups (as defined in section 2501(e)(2) of the 

23 Food, Agriculture, Conservation, and Trade Act 

24 of 1990 (7 U.S.C. 2279(e)(2))); 


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1 (C) individuals over 65 years of age and 

2 under 5 years of age; and 

3 (D) individuals with disabilities. 

4 (5) INTENT OF CONGRESS.—It is the intent of 

5 the Congress that allowances distributed to carry out 

6 this section should be used to supplement, and not re7 place, existing sources of funding used to address and 

8 build resilience to the impacts of climate change. 

9 (h) STATE AND TRIBAL CLIMATE CHANGE RESPONSE

10 PLANS.— 

11 (1) IN GENERAL.—The regulations promulgated 

12 pursuant to subsection (b) shall include requirements 

13 for submission and approval of State and tribal cli14 mate change response plans under this section. Begin15 ning with vintage year 2012, distribution of allow16 ances to a State pursuant to this section shall be con17 tingent on approval of a State climate change re18 sponse plan for such State that meets the require19 ments of such regulations. 

20 (2) REQUIREMENTS.—Regulations promulgated 

21 under this section shall require, at minimum, that 

22 State climate change response plans— 

23 (A) assess and prioritize the vulnerability of 

24 a State to a broad range of impacts of climate 

25 change, based on the best available science; 


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1 (B) identify and prioritize specific cost-ef2 fective projects, programs, and measures to miti3 gate and build resilience to current and pre4 dicted impacts of climate change, including 

5 projects, programs, and measures within each of 

6 the categories of activities listed in subsection 

7 (h)(2); 

8 (C) include an assessment of potential for 

9 carbon reduction through changes to land man10 agement policies (including enhancement or pro11 tection of forest carbon sinks); 

12 (D) ensure that the State fully considers 

13 and undertakes, to the maximum extent prac14 ticable, initiatives that— 

15 (i) protect or enhance natural eco16 system functions, including protection, 

17 maintenance, or restoration of natural in18 frastructure such as wetlands, reefs, and 

19 barrier islands to buffer communities from 

20 floodwaters or storms, watershed protection 

21 to maintain water quality and groundwater 

22 recharge, or floodplain restoration to im23 prove natural flood control capacity; 

24 (ii) where appropriate, use non25 structural approaches, including practices 


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1 that use, enhance, or mimic the natural hy2 drologic cycle processes of infiltration, 

3 evapotranspiration, and use; or 

4 (iii) where appropriate, protect for5 ested land via scientifically based ecological 

6 restoration practices, including by reducing 

7 fuel loads, restoring forest diversity, and 

8 conducting research on pest mitigation; 

9 (E) give consideration to impacts affecting 

10 socially and economically vulnerable popu11 lations, including— 

12 (i) persons of low-income (as defined 

13 in title I of the Housing and Community 

14 Development Act of 1974 (42 U.S.C. sec. 

15 5301 et seq.)); 

16 (ii) members of socially disadvantaged 

17 groups (as defined in section 2501(e)(2) of 

18 the Food, Agriculture, Conservation, and 

19 Trade Act of 1990 (7 U.S.C. 2279(e)(2))); 

20 (iii) persons over 65 years of age and 

21 under 5 years of age; and 

22 (iv) persons with disabilities; 

23 (F) use pre-disaster mitigation, emergency 

24 response, and public insurance programs to 

25 mitigate the impacts of climate change; 


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1 (G) be consistent with Federal conservation 

2 and environmental laws and, to the maximum 

3 extent practicable, avoid environmental degrada4 tion; and 

5 (H) be revised and resubmitted for approval 

6 not less frequently than every 5 years. 

7 (3) TRIBAL CLIMATE CHANGE RESPONSE

8 PLANS.—Requirements for tribal climate change re9 sponse plans should include the requirements listed in 

10 subparagraphs (A) through (H) of paragraph (2), as 

11 appropriate, but may vary from those of State cli12 mate change response plans to the extent necessary to 

13 account for the special circumstances of Indian tribes. 

14 (4) COORDINATION WITH PRIOR PLANNING EF15 FORTS.—In implementing this subsection, the Admin16 istrator, or the heads of such Federal agencies as the 

17 President may designate, shall— 

18 (A) draw upon lessons learned and best 

19 practices from preexisting State and tribal cli20 mate change response planning efforts; 

21 (B) seek to avoid duplication of such efforts; 

22 and 

23 (C) ensure that the plans developed under 

24 this section are developed in coordination with 


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1 State natural resources adaptation plans devel2 oped under section 369 of division A. 

3 (i) REPORTING.—Not later than 1 year after each date 

4 of receipt of allowances under this section, and biennially 

5 thereafter until the allowances received under this section 

6 have been fully expended, each State or Indian tribe receiv7 ing allowances under this section shall submit to the Ad8 ministrator, or the heads of such Federal agencies as the 

9 President may designate, a report that— 

10 (1) provides a full accounting for the use by the 

11 State or Indian tribe of allowances distributed under 

12 this section, including a description of the projects, 

13 programs, or measures supported using such allow14 ances; 

15 (2) includes a report prepared by an inde16 pendent third party, in accordance with such regula17 tions as are promulgated by the Administrator or the 

18 heads of such other Federal agencies as the President 

19 may designate, evaluating the performance of the 

20 projects, programs, or measures supported under this 

21 section; and 

22 (3) identifies any use by the State or Indian 

23 tribe of allowances distributed under this section for 

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1 fects of climate change on water and flood protection 

2 infrastructure. 

3 (j) AUDITING.—The Administrator, or the heads of 

4 such Federal agencies as the President may designate, shall 

5 have authority to conduct such audits or other review of 

6 States implementation of and compliance with this section 

7 as such Federal officials may in their discretion determine 

8 to be necessary or appropriate. 

9 (k) ENFORCEMENT.—If the Administrator, or the 

10 heads of such Federal agencies as the President may des11 ignate, determine that a State or Indian tribe is not in 

12 compliance with this section, the Administrator or such 

13 other agency head may withhold a quantity of the allow14 ances equal to up to twice the quantity of allowances that 

15 the State or Indian tribe failed to use in accordance with 

16 the requirements of this section, that such State or Indian 

17 tribe would otherwise be eligible to receive under this section 

18 in 1 or more later years. Allowances withheld pursuant to 

19 this subsection shall be distributed among the remaining 

20 States or Indian tribes ratably in accordance with— 

21 (1) the formula under subsection (c), in the case 

22 of allowances withheld from a State; or 

23 (2) in accordance with subsection (d), in the case 

24 of allowances withheld from an Indian tribe. 


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1 SEC. 211. CLIMATE CHANGE HEALTH PROTECTION AND 

2 PROMOTION FUND. 

3 (a) ESTABLISHMENT OF FUND.—There is established 

4 in the Treasury a separate account, to be known as the ‘‘Cli5 mate Change Health Protection and Promotion Fund’’. 

6 (b) AUCTION PROCEEDS.—The Administrator shall de7 posit the proceeds of the auction pursuant to section 

8 771(b)(6) of the Clean Air Act in the Climate Change 

9 Health Protection and Promotion Fund. 

10 (c) AVAILABILITY OF AMOUNTS.—All amounts depos11 ited in the Climate Change Health Protection and Pro12 motion Fund shall be available to the Secretary of Health 

13 and Human Services to carry out subpart B of subtitle C 

14 of title III of division A, without further appropriation or 

15 fiscal year limitation. 

16 (d) DISTRIBUTION OF FUNDS BY HHS.—In carrying 

17 out subpart B of subtitle C of title III of division A, the 

18 Secretary of Health and Human Services may make funds 

19 deposited in the Climate Change Health Protection and 

20 Promotion Fund available to— 

21 (1) other departments, agencies, and offices of the 

22 Federal Government; 

23 (2) foreign, State, tribal, and local governments; 

24 and 

25 (3) such other entities as the Secretary deter26 mines to be appropriate. 


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1 (e) SUPPLEMENT, NOT REPLACE.—It is the intent of 

2 Congress that funds made available to carry out subpart 

3 B of subtitle C of title III of division A should be used to 

4 supplement, and not replace, existing sources of funding for 

5 public health. 

6 SEC. 212. CLIMATE CHANGE SAFEGUARDS FOR NATURAL 

7 RESOURCES CONSERVATION. 

8 (a) ESTABLISHMENT OF FUND.—There is established 

9 in the Treasury a separate account, to be known as the 

10 ‘‘Natural Resources Climate Change Adaptation Account’’. 

11 (b) AUCTION PROCEEDS.—The Administrator shall de12 posit the proceeds of the auction conducted pursuant to sec13 tion 771(b)(7) of the Clean Air Act in the Natural Resources 

14 Climate Change Adaptation Account. 

15 (c) AVAILABILITY OF AMOUNTS.—All amounts depos16 ited in the Natural Resources Climate Change Adaptation 

17 Account shall be available without further appropriation or 

18 fiscal year limitation solely for the purposes of paragraphs 

19 (2) through (6) of section 370(a) of division A. 

20 SEC. 213. NUCLEAR WORKER TRAINING. 

21 (a) ESTABLISHMENT OF FUND.—There is established 

22 in the Treasury a separate account, to be known as the ‘‘Nu23 clear Worker Training Fund’’. 

24 (b) AUCTION PROCEEDS.—The Administrator shall de25 posit the proceeds of the auction conducted pursuant to secVerDate Nov 24 2008 22:59 Feb 02, 2010 Jkt 089200 PO 00000 Frm 01752 Fmt 6652 Sfmt 6203 E:\BILLS\S1733.RS S1733

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1 tion 771(b)(8) of the Clean Air Act in the Nuclear Worker 

2 Training Fund. 

3 (c) AVAILABILITY OF AMOUNTS.—All amounts depos4 ited in the Nuclear Worker Training Fund shall be avail5 able without further appropriation or fiscal year limitation 

6 solely for the purpose of carrying out section 132 of division 

7 A. 

8 SEC. 214. SUPPLEMENTAL AGRICULTURE, ABANDONED 

9 MINE LAND, RENEWABLE ENERGY, AND FOR10 ESTRY. 

11 (a) ESTABLISHMENT OF FUND.—There is established 

12 in the Treasury a separate account, to be known as the 

13 ‘‘Supplemental Agriculture, Abandoned Mine Land, Renew14 able Energy, and Forestry Fund’’. 

15 (b) AUCTION PROCEEDS.—The Administrator shall de16 posit the proceeds of the auction conducted pursuant to sec17 tion 771(b)(9) of the Clean Air Act in the Supplemental 

18 Agriculture, Abandoned Mine Land, Renewable Energy, 

19 and Forestry Fund. 

20 (c) AVAILABILITY OF AMOUNTS.—All amounts depos21 ited in the Supplemental Agriculture, Renewable Energy, 

22 Abandoned Mine Land, and Forestry Fund shall be avail23 able without further appropriation or fiscal year limitation 

24 solely for the purpose of carrying out section 155 of division 

25 A. 


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1 SEC. 215. INVESTMENT IN GREENHOUSE GAS REDUCTIONS 

2 FROM THE TRANSPORTATION SECTOR. 

3 (a) DEFINITIONS.—In this section: 

4 (1) ALLOWANCE.—The term ‘‘allowance’’ means 

5 an emission allowance established under section 721 

6 of the Clean Air Act. 

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

8 the Secretary of Transportation. 

9 (3) VINTAGE YEAR.—The term ‘‘vintage year’’ 

10 has the meaning given the term in section 700 of the 

11 Clean Air Act. 

12 (b) CLIMATE CHANGE TRANSPORTATION FUND.— 

13 (1) ESTABLISHMENT OF FUND.—There is estab14 lished in the Treasury a separate account, to be 

15 known as the ‘‘Climate Change Transportation 

16 Fund’’. 

17 (2) AUCTION PROCEEDS DEPOSITED TO FUND.— 

18 The Administrator shall deposit the proceeds of auc19 tions conducted pursuant to section 771(b)(10) of the 

20 Clean Air Act for the vintage years specified in the 

21 Climate Change Transportation Fund. 

22 (3) AVAILABILITY OF AMOUNTS.—All amounts 

23 deposited in the Climate Change Transportation 

24 Fund shall be available, without further appropria25 tion or fiscal year limitation, to carry out this sec26 tion. 


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1 (c) DISTRIBUTION OF ALLOWANCES.—For each year, 

2 the Secretary shall use the proceeds of allowance auctions 

3 deposited in the Climate Change Transportation Fund to 

4 reduce emissions from the transportation sector in accord5 ance with the following formula: 

6 (1) 50 percent of the allowances shall be used ex7 clusively for the Transportation Greenhouse Gas Re8 duction program in accordance with section 832 of 

9 the Clean Air Act. 

10 (2) 50 percent of the allowances shall be used ex11 clusively for public transportation grants in accord12 ance with subsection (d). 

13 (d) DISTRIBUTION OF PUBLIC TRANSPORTATION

14 GRANTS.— 

15 (1) IN GENERAL.—The Secretary shall distribute 

16 the amounts available for public transportation 

17 grants for each fiscal year in accordance with sub18 section (c)(2) as grants to public transportation agen19 cies (including designated recipients (as defined in 

20 section 5307(a) and section 5340 of title 49, United 

21 States Code)) and recipients and sub-recipients (as 

22 defined in section 5311(a) of title 49, United States 

23 Code). 

24 (2) FORMULA.—In providing grants under this 

25 subsection, the Secretary shall distribute— 


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1 (A) 80 percent of the funds in accordance 

2 with the formula and conditions governing 

3 grants under section 5307 of title 49, United 

4 States Code; 

5 (B) 10 percent of the funds in accordance 

6 with the formula and conditions governing 

7 grants under section 5311 of title 49, United 

8 States Code (including subsection (f) of that sec9 tion); and 

10 (C) 10 percent of the funds in accordance 

11 with the formula and conditions governing 

12 grants under section 5340 of title 49, United 

13 States Code. 

14 (e) AGREEMENTS.—No grant may be provided to a 

15 public transportation agency under this section for any fis16 cal year unless— 

17 (1) the grant is limited to a project approved in 

18 accordance with the greenhouse gas emission reduc19 tion provisions under section 112 of division A; and 

20 (2) the public transportation agency enters into 

21 such agreements with the Secretary as the Secretary 

22 may require to ensure that the public transportation 

23 agency will maintain the aggregate expenditures of 

24 the public transportation agency from all other 

25 sources for programs described in paragraph (1) at or 


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1 above the average level of those expenditures during 

2 the 2 fiscal years preceding the date of enactment of 

3 this Act. 

4 (f) LIMITATION ON USE OF FUNDS.—Public transpor5 tation grants funded under this section may be used only 

6 to fund strategies that demonstrate a reduction in green7 house gas emissions. 

8 SEC. 216. STATE PROGRAMS FOR NATURAL RESOURCE AD9 APTATION ACTIVITIES. 

10 The Administrator shall distribute emission allow11 ances allocated for the following vintage year pursuant to 

12 section 771(a)(16) of the Clean Air Act among the States 

13 in accordance with the formula described in section 

14 370(a)(1) of division A, exclusively to carry out natural 

15 resources adaptation activities in accordance with adapta16 tion plans approved under section 369 of division A. 


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Calendar No. 267 

111TH CONGRESS 

2D SESSION S. 1733 

[Report No. 111–121] 

A BILL 

To create clean energy jobs, promote energy indetransition to a clean energy economy. pendence, reduce global warming pollution, and 

FEBRUARY 2, 2010 

Reported with an amendment 


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