II 

115TH CONGRESS 

2D SESSION S. 2681 

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 17, 2018 

Mr. MANCHIN 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 ‘‘Energy Reliability Act 

5 of 2018’’. 

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— 

19 ‘‘(1) uses coal to produce not less than 75 per20 cent of the electricity produced by such unit, and 

21 ‘‘(2) has constructed and installed emissions 

22 controls pursuant to— 

23 ‘‘(A) the final rule of the Environmental 

24 Protection Agency entitled ‘Rule To Reduce 

25 Interstate Transport of Fine Particulate Matter 


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1 and Ozone (Clean Air Interstate Rule); Revi2 sions to Acid Rain Program; Revisions to the 

3 NOX SIP Call’ (70 Fed. Reg. 25162 (May 12, 

4 2005)) (commonly known as the ‘Clean Air 

5 Interstate Rule’), 

6 ‘‘(B) the final rule of the Environmental 

7 Protection Agency entitled ‘Federal Implemen8 tation Plans: Interstate Transport of Fine Par9 ticulate Matter and Ozone and Correction of 

10 SIP Approvals’ (76 Fed. Reg. 48208 (August 

11 8, 2011)) (commonly known as the ‘Cross State 

12 Air Pollution Rule’), 

13 ‘‘(C) the final rule of the Environmental 

14 Protection Agency entitled ‘National Emission 

15 Standards for Hazardous Air Pollutants From 

16 Coal- and Oil-Fired Electric Utility Steam Gen17 erating Units and Standards of Performance 

18 for Fossil-Fuel-Fired Electric Utility, Indus19 trial-Commercial-Institutional, and Small In20 dustrial-Commercial-Institutional Steam Gener21 ating Units’ (77 Fed. Reg. 9304 (February 16, 

22 2012)) (commonly known as the ‘Mercury and 

23 Air Toxics Standards Rule’), 

24 ‘‘(D) the final rule of the Environmental 

25 Protection Agency entitled ‘Regional Haze RegVerDate Sep 11 2014 04:54 Apr 19, 2018 Jkt 079200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S2681.IS S2681

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1 ulations and Guidelines for Best Available Ret2 rofit Technology (BART) Determinations’ (70 

3 Fed. Reg. 39104 (July 6, 2005)) (commonly 

4 known as the ‘Regional Haze regulations’), or 

5 ‘‘(E) any other Federal emissions control 

6 requirements applicable to an electric genera7 tion plant that are equal to or more stringent 

8 than the requirements of a rule described in 

9 subparagraph (A), (B), (C), or (D). 

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

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

12 or incurred for the operation or maintenance of a coal13 powered electric generation unit, other than amounts paid 

14 or incurred for coal. 

15 ‘‘(d) TRANSFER OF CREDIT.— 

16 ‘‘(1) TRANSFER TO ELIGIBLE PROJECT PART17 NER.— 

18 ‘‘(A) IN GENERAL.—With respect to a 

19 credit under subsection (a) for any taxable year, 

20 a taxpayer may elect to transfer all or any por21 tion of such credit to any eligible project part22 ner as specified in such election and such eligi23 ble project partner, not the taxpayer, shall be 

24 entitled to claim the credit (or portion thereof) 

25 for the taxable year. 


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1 ‘‘(B) ELECTION TO TRANSFER.—The tax2 payer may elect to transfer all or any portion 

3 of the credit to an eligible project partner by at4 taching a statement to the taxpayer’s tax re5 turn for the taxable year in which the qualified 

6 expenses were paid or incurred, providing such 

7 information as is necessary for the Secretary to 

8 adequately identify the eligible project partner 

9 and the amount of the credit being transferred. 

10 ‘‘(2) ELIGIBLE PROJECT PARTNER.—For pur11 poses of this subsection, the term ‘eligible project 

12 partner’ means, with respect to any coal-powered 

13 electric generation unit, any person who— 

14 ‘‘(A) is responsible for operating, maintain15 ing, or repairing such unit, 

16 ‘‘(B) participates in the provision, includ17 ing transportation, of coal or other materials 

18 and supplies to such unit, 

19 ‘‘(C) provides financing for the construc20 tion, repair, or operation of such unit, or 

21 ‘‘(D) leases such unit. 

22 ‘‘(3) SPECIAL RULES.— 

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

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

25 is determined at the partnership level, the term 


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1 ‘eligible project partner’ shall include any part2 ner of the partnership. 

3 ‘‘(B) TAXABLE YEAR IN WHICH CREDIT

4 TAKEN INTO ACCOUNT.—In the case of any 

5 credit (or portion thereof) with respect to which 

6 an election is made under paragraph (1), such 

7 credit shall be taken into account in the first 

8 taxable year of the eligible project partner end9 ing with, or after, the taxpayer’s taxable year 

10 with respect to which the credit was deter11 mined. 

12 ‘‘(e) BASIS ADJUSTMENT.—For purposes of this sub13 title, if a credit is allowed under this section with respect 

14 to any coal-powered electric generation unit, the basis of 

15 such property shall be reduced by the amount of the credit 

16 so allowed. 

17 ‘‘(f) TERMINATION.—This section shall apply to tax18 able years beginning after December 31, 2017, and ending 

19 before January 1, 2023.’’. 

20 (b) ASSESSMENT BY FEDERAL ENERGY REGU21 LATORY COMMISSION.— 

22 (1) IN GENERAL.—In the case of any coal-pow23 ered electric generation unit which has claimed a 

24 credit under section 45T of the Internal Revenue 

25 Code of 1986 (as added by subsection (a)), the FedVerDate Sep 11 2014 04:54 Apr 19, 2018 Jkt 079200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S2681.IS S2681

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1 eral Energy Regulatory Commission shall require 

2 the applicable reliability coordinator to conduct an 

3 assessment analyzing the reliability and resilience at4 tributes offered by such unit to the regional grid in 

5 which it is located, with such assessment to be com6 pleted not later than April 1, 2023. 

7 (2) REPORTING.—Not later than June 1, 2023, 

8 the Federal Energy Regulatory Commission shall re9 port to the relevant Congressional committees— 

10 (A) the results of the assessments de11 scribed under paragraph (1); and 

12 (B) a recommendation as to whether the 

13 credit under section 45T of the Internal Rev14 enue Code of 1986 should be amended so as to 

15 apply to taxable years beginning after Decem16 ber 31, 2022. 

17 (3) DEFINITIONS.—In this subsection: 

18 (A) APPLICABLE RELIABILITY COORDI19 NATOR.—The term ‘‘applicable reliability coor20 dinator’’ means the Reliability Coordinator of 

21 the Electric Reliability Organization (as defined 

22 in section 215(a) of the Federal Power Act (16 

23 U.S.C. 2824o(a))) for the region in which a 

24 coal-powered electric generation unit which has 


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1 claimed a credit under section 45T of the Inter2 nal Revenue Code of 1986 is located. 

3 (B) RELEVANT CONGRESSIONAL COMMIT4 TEES.—The term ‘‘relevant Congressional com5 mittees’’ means— 

6 (i) the Committee on Finance of the 

7 Senate; 

8 (ii) the Committee on Ways and 

9 Means of the House of Representatives; 

10 (iii) the Committee on Energy and 

11 Natural Resources of the Senate; and 

12 (iv) the Committee on Energy and 

13 Commerce of the House of Representa14 tives. 

15 (c) CONFORMING AMENDMENT.—Section 

16 501(c)(12)(I) is amended by inserting ‘‘or 45T(d)(1)’’ 

17 after ‘‘section 45J(e)(I)’’. 

18 (d) CREDIT TO BE PART OF GENERAL BUSINESS

19 CREDIT.— 

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

21 Revenue Code of 1986 is amended by striking 

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

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

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

25 paragraph: 


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

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

3 (2) CREDIT ALLOWED AGAINST ALTERNATIVE

4 MINIMUM TAX.—Subparagraph (B) of section 

5 38(c)(4) of the Internal Revenue Code of 1986 is 

6 amended— 

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

8 (xii) as clauses (xi), (xii), and (xiii), respec9 tively; and 

10 (B) by inserting after clause (ix) the fol11 lowing new clause: 

12 ‘‘(x) the credit determined under sec13 tion 45T,’’. 

14 (e) CLERICAL AMENDMENT.—The table of sections 

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

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

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

Æ 


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