II 

115TH CONGRESS 

2D SESSION S. 2677 

To amend the Internal Revenue Code of 1986 to allow a credit against 

tax for coal-powered electric generation units. 

IN THE SENATE OF THE UNITED STATES 

APRIL 16, 2018 

Mrs. CAPITO introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to allow a 

credit against tax for coal-powered electric generation units. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Electricity Reliability 

5 and Fuel Security Act’’. 

6 SEC. 2. COAL-POWERED ELECTRIC GENERATION UNIT 

7 CREDIT. 

8 (a) FEDERAL TAX CREDIT FOR COAL-POWERED

9 ELECTRIC GENERATION UNITS.—Subpart D of part IV 

10 of subchapter A of chapter 1 of the Internal Revenue Code 


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1 of 1986 is amended by adding at the end the following 

2 new section: 

3 ‘‘SEC. 45T. COAL-POWERED ELECTRIC GENERATION UNIT 

4 CREDIT. 

5 ‘‘(a) IN GENERAL.—For purposes of section 38, in 

6 the case of a taxpayer who owns or leases a coal-powered 

7 electric generation unit, the coal-powered electric genera8 tion unit credit determined under this section for a taxable 

9 year shall be an amount equal to the lesser of 30 percent 

10 of qualified expenses paid or incurred by such taxpayer 

11 in such year or the product of— 

12 ‘‘(1) $13, multiplied by 

13 ‘‘(2) the nameplate capacity rating in kilowatts 

14 of such unit. 

15 ‘‘(b) COAL-POWERED ELECTRIC GENERATION

16 UNIT.—For purposes of this section, the term ‘coal-pow17 ered electric generation unit’ means an electric generation 

18 unit (as defined in section 48A(c)(6)) that uses coal to 

19 produce not less than 75 percent of the electricity pro20 duced by such unit. 

21 ‘‘(c) QUALIFIED EXPENSES.—For purposes of this 

22 section, the term ‘qualified expenses’ means amounts paid 

23 or incurred for the operation or maintenance of a coal24 powered electric generation unit, other than amounts paid 

25 or incurred for coal. 


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1 ‘‘(d) TRANSFER OF CREDIT.— 

2 ‘‘(1) IN GENERAL.—With respect to a credit 

3 under subsection (a) for any taxable year, a tax4 payer may elect to transfer all or any portion of 

5 such credit to any eligible project partner as speci6 fied in such election and such eligible project part7 ner, not the taxpayer, shall be entitled to claim the 

8 credit for such taxable year. 

9 ‘‘(2) ELECTION TO TRANSFER.—The taxpayer 

10 may elect to transfer all or any portion of the credit 

11 to an eligible project partner by attaching a state12 ment to the taxpayer’s tax return for the taxable 

13 year in which the qualified expenses were paid or in14 curred, providing such information as is necessary 

15 for the Secretary to adequately identify the eligible 

16 project partner and the amount of the credit being 

17 transferred. 

18 ‘‘(3) APPLICATION TO QUALIFIED PUBLIC ENTI19 TIES.— 

20 ‘‘(A) IN GENERAL.—For purposes of this 

21 subsection, the term ‘taxpayer’ shall include a 

22 qualified public entity. 

23 ‘‘(B) QUALIFIED PUBLIC ENTITY.—The 

24 term ‘qualified public entity’ means— 


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1 ‘‘(i) a Federal, State, or local govern2 ment entity, or any political subdivision, 

3 agency, or instrumentality thereof, 

4 ‘‘(ii) a mutual or cooperative electric 

5 company described in section 501(c)(12) or 

6 1381(a)(2), or 

7 ‘‘(iii) a not-for-profit electric utility 

8 which had or has received a loan or loan 

9 guarantee under the Rural Electrification 

10 Act of 1936. 

11 ‘‘(4) ELIGIBLE PROJECT PARTNER.—With re12 spect to coal-powered electric generation unit, the 

13 term ‘eligible project partner’ means any person 

14 who— 

15 ‘‘(A) is responsible for operating, maintain16 ing, or repairing such unit, 

17 ‘‘(B) participates in the provision, includ18 ing transportation, of coal or other materials 

19 and supplies to such unit, 

20 ‘‘(C) provides financing for the construc21 tion, expansion, repair, or operation of such 

22 unit, or 

23 ‘‘(D) leases such unit. 

24 ‘‘(5) SPECIAL RULES.— 


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1 ‘‘(A) APPLICATION TO PARTNERSHIPS.—In 

2 the case of a credit under subsection (a) which 

3 is determined at the partnership level, the term 

4 ‘eligible project partner’ shall include any part5 ner of the partnership. 

6 ‘‘(B) TAXABLE YEAR IN WHICH CREDIT

7 TAKEN INTO ACCOUNT.—In the case of any 

8 credit (or portion thereof) with respect to which 

9 an election is made under paragraph (2), such 

10 credit shall be taken into account in the first 

11 taxable year of the eligible project partner end12 ing with, or after, the taxpayer’s taxable year 

13 with respect to which the credit was deter14 mined. 

15 ‘‘(C) TREATMENT OF TRANSFER UNDER

16 PRIVATE USE RULES.—For purposes of section 

17 141(b)(1), any benefit derived by an eligible 

18 project partner in connection with an election 

19 under this subsection shall not be taken into ac20 count as a private business use. 

21 ‘‘(e) BASIS ADJUSTMENT.—For purposes of this sub22 title, if a credit is allowed under this section with respect 

23 to any coal-powered electric generation unit, the basis, if 

24 any, of such property shall be reduced by the amount of 

25 the credit so allowed. 


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1 ‘‘(f) TERMINATION.—This section shall apply to tax2 able years beginning after December 31, 2017, and ending 

3 before January 1, 2023.’’. 

4 (b) CONFORMING AMENDMENT.—Section 

5 501(c)(12)(I) is amended by inserting ‘‘or 45T(d)(1)’’ 

6 after ‘‘section 45J(e)(I)’’. 

7 (c) CREDIT TO BE PART OF GENERAL BUSINESS

8 CREDIT.— 

9 (1) IN GENERAL.—Section 38(b) of the Internal 

10 Revenue Code of 1986 is amended by striking 

11 ‘‘plus’’ at the end of paragraph (36), by striking the 

12 period at the end of paragraph (37) and inserting ‘‘, 

13 plus’’, and by adding at the end the following new 

14 paragraph: 

15 ‘‘(38) the coal-powered electric generation unit 

16 credit determined under section 45T(a).’’. 

17 (2) CREDIT ALLOWED AGAINST ALTERNATIVE

18 MINIMUM TAX.—Subparagraph (B) of section 

19 38(c)(4) of the Internal Revenue Code of 1986 is 

20 amended— 

21 (A) by redesignating clauses (x), (xi), and 

22 (xii) as clauses (xi), (xii), and (xiii), respec23 tively; and 

24 (B) by inserting after clause (ix) the fol25 lowing new clause: 


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1 ‘‘(x) the credit determined under sec2 tion 45T,’’. 

3 (d) CLERICAL AMENDMENT.—The table of sections 

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

5 is amended by adding at the end the following new item: 

‘‘Sec. 45T. Coal-powered electric generation unit credit.’’. 

Æ 


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