I 

111TH CONGRESS 

1ST SESSION H. R. 4389 

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

income tax to taxpayers using energy derived from biomass to power 

domestic paper, pulp and paperboard manufacturing process facilities. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 16, 2009 

Mr. MURPHY of New York introduced the following bill; which was referred 

to the Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to allow a 

credit against income tax to taxpayers using energy derived from biomass to power domestic paper, pulp and 

paperboard manufacturing process facilities. 

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 ‘‘Green Energy Paper 

5 Manufacturing Act of 2009’’. 


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1 SEC. 2. CREDIT FOR USING ENERGY DERIVED FROM BIO2 MASS TO POWER DOMESTIC PAPER, PULP 

3 AND PAPERBOARD MANUFACTURING PROC4 ESS FACILITIES. 

5 (a) IN GENERAL.—Subpart D of part IV of sub6 chapter A of chapter 1 of the Internal Revenue Code of 

7 1986 (relating to business-related credits) is amended by 

8 inserting after section 45Q the following new section: 

9 ‘‘SEC. 45R. ENERGY DERIVED FROM BIOMASS TO POWER 

10 DOMESTIC PAPER, PULP AND PAPERBOARD 

11 MANUFACTURING PROCESS FACILITIES. 

12 ‘‘(a) GENERAL RULE.—For purposes of section 38, 

13 the renewable green-energy pulp, paper or paperboard 

14 manufacturing credit for any taxable year is an amount 

15 equal to the product of— 

16 ‘‘(1) $4, multiplied by 

17 ‘‘(2) the number of million Btus of steam and 

18 electricity— 

19 ‘‘(A) produced by the taxpayer— 

20 ‘‘(i) from biomass fuels, and 

21 ‘‘(ii) at a qualified paper product fa22 cility (or at an energy production facility 

23 which is located in the United States and 

24 which is under contract to provide steam 

25 or electricity to any qualified paper prod26 uct facility) during the 10-year period beVerDate Nov 24 2008 02:09 Dec 19, 2009 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4389.IH H4389

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1 ginning on the later of the date of the en2 actment of this section or the date the fa3 cility was originally placed in service, and 

4 ‘‘(B) used by the taxpayer at, or provided 

5 by the taxpayer to, any pulp, paper or paper6 board manufacturing facility located in the 

7 United States. 

8 ‘‘(b) MAXIMUM ANNUAL CREDIT PER FACILITY.— 

9 ‘‘(1) IN GENERAL.—The credit determined 

10 under this section for energy used during the taxable 

11 year at any qualified paper product facility shall not 

12 exceed $25,000,000. 

13 ‘‘(2) COORDINATION WITH ADVANCE PAY14 MENTS.—The dollar amount in paragraph (1) shall 

15 be reduced for any taxable year by the aggregate of 

16 the claims made under section 6429 for periods dur17 ing such year with respect to such facility. 

18 ‘‘(c) DENIAL OF DOUBLE BENEFIT.—Btus may not 

19 be taken into account under subsection (a)(2) if any credit 

20 is allowed under section 40, 40A, 45, or 6426 for the elec21 tricity generation, the feedstock, or for the blending of the 

22 feedstock associated with the Btus. 

23 ‘‘(d) DEFINITIONS.—For purposes of this section— 

24 ‘‘(1) BIOMASS FUELS.— 


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1 ‘‘(A) IN GENERAL.—The term ‘biomass 

2 fuels’ means any liquid, solid, or gaseous fuel 

3 derived from biomass (as defined in section 

4 45K(c)(3)) or from biomass process residuals 

5 from recycled and other paper facilities. 

6 ‘‘(B) COFIRING WITH FOSSIL FUELS.—In 

7 the case of fossil fuel burned in conjunction 

8 with any biomass fuel, only the Btus attrib9 utable to biomass fuel may be taken into ac10 count under subsection (a). 

11 ‘‘(2) QUALIFIED PAPER PRODUCT FACILITY.— 

12 The term ‘qualified paper product facility’ means 

13 any pulp, paper, or paperboard manufacturing facil14 ity— 

15 ‘‘(A) which is originally placed in service 

16 before the close of the 5-year period beginning 

17 on the date of the enactment of this section, 

18 and 

19 ‘‘(B) which is located in the United States. 

20 ‘‘(e) REINVESTMENT REQUIREMENT.— 

21 ‘‘(1) IN GENERAL.—The tax imposed by this 

22 chapter for any taxable year shall be increased by 

23 the recapture amount (if any) for the 3rd preceding 

24 taxable year. 


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1 ‘‘(2) RECAPTURE AMOUNT.—For purposes of 

2 paragraph (1), the term ‘recapture amount’ means, 

3 with respect to any taxable year, the excess (if any) 

4 of— 

5 ‘‘(A) 50 percent of the sum of— 

6 ‘‘(i) the credit determined under this 

7 section for the taxable year, and 

8 ‘‘(ii) the aggregate payments made 

9 under section 6429 to the taxpayer for 

10 steam and electricity produced during such 

11 year, over 

12 ‘‘(B) the aggregate qualified reinvestment 

13 made by the taxpayer during such year and the 

14 3 succeeding taxable years (reduced by the 

15 qualified reinvestment taken into account in de16 termining the recapture amount for any prior 

17 taxable year). 

18 ‘‘(3) QUALIFIED REINVESTMENT.— 

19 ‘‘(A) IN GENERAL.—For purposes of para20 graph (2), the term ‘qualified reinvestment’ 

21 means the basis of renewable energy projects, 

22 energy efficiency projects and other environ23 mental improvements at facilities owned by the 

24 taxpayer and located in the United States. 


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1 ‘‘(B) REDUCTION FOR FEDERAL BENE2 FITS.—The basis otherwise taken into account 

3 under subparagraph (A) shall be reduced by the 

4 aggregate of— 

5 ‘‘(i) the credits under this chapter, 

6 and 

7 ‘‘(ii) Federal grants, 

8 allowed or received on account of the invest9 ment. 

10 ‘‘(4) WHEN REINVESTMENTS TAKEN INTO AC11 COUNT.— 

12 ‘‘(A) IN GENERAL.—Qualified reinvestment 

13 shall be taken into account when the property 

14 is placed in service. 

15 ‘‘(B) ELECTION.—At the election of the 

16 taxpayer with respect to any qualified reinvest17 ment which is constructed by the taxpayer— 

18 ‘‘(i) the estimated amount of such in19 vestment shall be treated as made when 

20 the physical work of such construction be21 gins, and 

22 ‘‘(ii) proper adjustments shall be 

23 made to such amount in the taxable year 

24 in which such investment is placed in servVerDate Nov 24 2008 02:09 Dec 19, 2009 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H4389.IH H4389

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1 ice in any case where such estimate is 

2 greater or less than the proper amount. 

3 ‘‘(f) MULTIPLE FACILITY OWNERS.—If more than 1 

4 person has an ownership interest in a qualified paper 

5 product facility, the dollar limitation in subsection (b) 

6 shall be allocated among such persons under regulations 

7 prescribed by the Secretary.’’. 

8 (b) CREDIT MADE PART OF GENERAL BUSINESS

9 CREDIT AND ALLOWABLE AGAINST MINIMUM TAX.— 

10 (1) IN GENERAL.—Subsection (b) of section 38 

11 of such Code (relating to current year business cred12 it) is amended by striking ‘‘plus’’ at the end of para13 graph (34), by striking the period at the end of 

14 paragraph (35) and inserting ‘‘, plus’’, and by add15 ing at the end the following new paragraph: 

16 ‘‘(36) the renewable green-energy pulp, paper 

17 or paperboard manufacturing credit determined 

18 under section 45R.’’. 

19 (2) CREDIT ALLOWABLE AGAINST MINIMUM

20 TAX.—Subparagraph (B) of section 38(c)(4) of such 

21 Code (relating to specified credits) is amended by 

22 striking ‘‘and’’ at the end of clause (vii), by striking 

23 the period at the end of clause (viii) and inserting 

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

25 clause: 


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1 ‘‘(ix) the credit determined under sec2 tion 45R.’’. 

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

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

5 of such Code is amended by inserting after the item relat6 ing to section 45Q the following new item: 

‘‘Sec. 45R. Energy derived from biomass to power domestic paper, pulp and paperboard manufacturing process facilities.’’. 

7 (d) EFFECTIVE DATE.—The amendments made by 

8 this section shall apply to energy produced after December 

9 31, 2009, in taxable years ending after such date. 

10 SEC. 3. ADVANCE PAYMENTS FOR LIQUID BIOMASS USED 

11 AS A FUEL AT PAPER PRODUCT FACILITIES. 

12 (a) IN GENERAL.—Subchapter B of chapter 65 of the 

13 Internal Revenue Code of 1986 (relating to abatements, 

14 credits, and refunds) is amended by striking section 6429 

15 and inserting the following new section: 

16 ‘‘SEC. 6429. ADVANCE PAYMENTS FOR LIQUID BIOMASS 

17 USED AS A FUEL AT PAPER PRODUCT FACILI18 TIES. 

19 ‘‘(a) IN GENERAL.—If any person uses any qualified 

20 biomass liquid as a fuel to produce steam or electricity 

21 for use at any pulp, paper or paperboard manufacturing 

22 facility located in the United States, the Secretary shall 

23 pay (without interest) to such person an amount equal 

24 to— 


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1 ‘‘(1) $4, multiplied by 

2 ‘‘(2) the number of million Btus of steam and 

3 electricity so produced. 

4 ‘‘(b) MAXIMUM ANNUAL PAYMENTS PER FACIL5 ITY.—The amount paid by the Secretary under this sec6 tion for energy used during any taxable year at any quali7 fied paper product facility shall not exceed $25,000,000. 

8 ‘‘(c) QUALIFIED BIOMASS LIQUID.—For purposes of 

9 this section, the term ‘qualified biomass liquid’ means any 

10 liquid— 

11 ‘‘(1) which is derived from— 

12 ‘‘(A) biomass (as defined in section 

13 45K(c)(3)), or 

14 ‘‘(B) biomass process residuals from recy15 cled and other paper facilities if such residuals 

16 meet the test of liquids set forth in ASTM 

17 D4359–90, and 

18 ‘‘(2) which is produced by such person at a 

19 qualified paper product facility (as defined in section 

20 45R(d)(2)) during the 10-year period beginning on 

21 the later of the date of the enactment of this section 

22 or the date the facility was originally placed in serv23 ice. 

24 ‘‘(d) TIME FOR FILING CLAIMS; PERIOD COV25 ERED.— 


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1 ‘‘(1) IN GENERAL.—A claim may be filed under 

2 this section by any person for any period— 

3 ‘‘(A) for which $200 or more is payable, 

4 and 

5 ‘‘(B) which is not less than 1 week. 

6 In the case of an electronic claim, this paragraph 

7 shall be applied without regard to subparagraph (A). 

8 ‘‘(2) PAYMENT OF CLAIM.—Notwithstanding 

9 subsection (a), if the Secretary has not paid pursu10 ant to a claim filed under this section within 45 days 

11 of the date of the filing of such claim (20 days in 

12 the case of an electronic claim), the claim shall be 

13 paid with interest from such date determined by 

14 using the overpayment rate and method under sec15 tion 6621. 

16 ‘‘(3) TIME FOR FILING CLAIM.—No claim filed 

17 under this subsection shall be allowed unless filed on 

18 or before the last day of the first quarter following 

19 the earliest quarter included in the claim. 

20 ‘‘(e) COFIRING WITH FOSSIL FUELS.—In the case 

21 of fossil fuel burned in conjunction with any qualified bio22 mass liquid, only the Btus attributable to the qualified bio23 mass liquid may be taken into account under subsection 

24 (a).’’. 

25 (b) CONFORMING AMENDMENTS.— 


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1 (1) The table of sections for such subchapter B 

2 is amended by striking the item relating to section 

3 6429 and inserting the following new item: 

‘‘Sec. 6429. Advance payments for liquid biomass used as a fuel at paper product facilities.’’. 

4 (2) Section 1324(b)(2) of title 31, United 

5 States Code, is amended by inserting ‘‘6429,’’ after 

6 ‘‘6428,’’. 

7 (c) EFFECTIVE DATE.—The amendments made by 

8 this section shall apply to energy produced after December 

9 31, 2009, in taxable years ending after such date. 

Æ 


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