I 

118TH CONGRESS 

1ST SESSION H. R. 6622 

To amend the Internal Revenue Code of 1986 to create a carbon border 

adjustment based on carbon intensity, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 6, 2023 

Ms. DELBENE (for herself, Mr. BEYER, Ms. CASTOR of Florida, and Mr. 

BERA) introduced the following bill; which was referred to the Committee 

on Ways and Means, and in addition to the Committee on Energy and 

Commerce, for a period to be subsequently determined by the Speaker, 

in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend the Internal Revenue Code of 1986 to create 

a carbon border adjustment based on carbon intensity, 

and for other purposes. 

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 ‘‘Clean Competition 

5 Act’’. 

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1 SEC. 2. CARBON INTENSITY CHARGE. 

2 (a) IN GENERAL.—Chapter 38 of the Internal Rev3 enue Code of 1986 is amended by adding at the end the 

4 following new subchapter: 

5 ‘‘Subchapter E—Carbon Intensity Charge 

‘‘Sec. 4691. Calculation of carbon intensity. 

‘‘Sec. 4692. Imposition of carbon intensity charge. 

‘‘Sec. 4693. Rebate. 

‘‘Sec. 4694. Definitions. 

6 ‘‘SEC. 4691. CALCULATION OF CARBON INTENSITY. 

7 ‘‘(a) REPORTING REQUIREMENTS.—Not later than 

8 June 30, 2026, and annually thereafter, any covered enti9 ty shall, for each eligible facility operated by such entity, 

10 report to the Secretary (and, for purposes of the informa11 tion described in paragraphs (2) and (3), the Adminis12 trator) with respect to the following: 

13 ‘‘(1) Any information required to be reported to 

14 the Administrator under the Greenhouse Gas Re15 porting Program (or which would be required to be 

16 reported notwithstanding any other provision of law 

17 prohibiting the implementation of or use of funds for 

18 such requirements) for the preceding calendar year. 

19 ‘‘(2) The total amount of electricity used at 

20 such facility during the preceding calendar year, in21 cluding— 

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1 ‘‘(A) whether such electricity was provided 

2 through the electric grid or a dedicated genera3 tion source, 

4 ‘‘(B) the terms of any power purchase 

5 agreements with respect to such facility, and 

6 ‘‘(C) with respect to any electricity which 

7 was not provided through the electric grid, the 

8 greenhouse gas emissions associated with the 

9 production of such electricity, provided that 

10 such emissions are not reported pursuant to 

11 paragraph (1). 

12 ‘‘(3) The total weight (expressed in tons) of 

13 each covered primary good produced at such facility 

14 during the preceding calendar year. 

15 ‘‘(b) CALCULATION.— 

16 ‘‘(1) CARBON INTENSITY.— 

17 ‘‘(A) ELIGIBLE FACILITY.—For purposes 

18 of this subchapter, for each calendar year, the 

19 carbon intensity with respect to any eligible fa20 cility shall be an amount equal to the quotient 

21 of— 

22 ‘‘(i) the covered emissions (as deter23 mined under paragraph (2)) with respect 

24 to such facility, divided by 

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1 ‘‘(ii) the total weight (expressed in 

2 tons) of covered primary goods produced at 

3 such facility during the preceding calendar 

4 year. 

5 ‘‘(B) COVERED NATIONAL INDUSTRY.— 

6 ‘‘(i) IN GENERAL.—For purposes of 

7 this subchapter, the carbon intensity with 

8 respect to any covered national industry 

9 shall be an amount (as determined by the 

10 Secretary) equal to the quotient of— 

11 ‘‘(I) an amount equal to the sum 

12 of the covered emissions (as deter13 mined under paragraph (2)) with re14 spect to all eligible facilities which 

15 produce covered primary goods which 

16 are included within such industry for 

17 calendar year 2025, divided by 

18 ‘‘(II) the total weight (expressed 

19 in tons) of covered primary goods 

20 within such industry which are pro21 duced at all such eligible facilities dur22 ing such year. 

23 ‘‘(ii) DETERMINATION.—For purposes 

24 of this subchapter, the Secretary (in co25 ordination with the relevant parties) may 

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1 determine which types of eligible facilities 

2 (and any related covered primary goods) 

3 are included or excluded within a covered 

4 national industry, provided that such de5 termination— 

6 ‘‘(I) facilitates a fair comparison 

7 of carbon intensities across similar eli8 gible facilities (based on a comparison 

9 of the material inputs and outputs of 

10 such facilities), and 

11 ‘‘(II) does not meaningfully re12 duce the scope of greenhouse gas 

13 emissions covered by this subchapter. 

14 ‘‘(iii) EXCLUDED FACILITIES.—In the 

15 case of any eligible facility which, pursuant 

16 to clause (ii), is excluded from a covered 

17 national industry and is not included in 

18 any other covered national industry, such 

19 facility shall be deemed to not be included 

20 in any covered national industry. 

21 ‘‘(C) PETITION FOR SPECIFIC GOODS.— 

22 ‘‘(i) IN GENERAL.—In the case of any 

23 covered national industry which produces 

24 more than 1 covered primary good, a covVerDate Sep 11 2014 01:09 Dec 19, 2023 Jkt 049200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H6622.IH H6622
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1 ered entity may file a petition with the 

2 Secretary to— 

3 ‘‘(I) determine the carbon inten4 sity with respect to a specific covered 

5 primary good, and 

6 ‘‘(II) determine a classification 

7 for defining such covered primary 

8 good for purposes of this subchapter, 

9 such as— 

10 ‘‘(aa) the applicable 6-digit 

11 subheading of the Harmonized 

12 Tariff Schedule of the United 

13 States, 

14 ‘‘(bb) the relevant produc15 tion process, 

16 ‘‘(cc) a set of material char17 acteristics, or 

18 ‘‘(dd) any combination of 

19 the methods for classification de20 scribed in items (aa) through 

21 (cc). 

22 ‘‘(ii) REVIEW.—With respect to any 

23 covered primary good which is included in 

24 a petition described in clause (i), the Sec25 retary (in coordination with the AdminisVerDate Sep 11 2014 01:09 Dec 19, 2023 Jkt 049200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H6622.IH H6622
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1 trator and the Secretary of Energy) shall 

2 approve such petition if— 

3 ‘‘(I) the chemical, physical, or 

4 mechanical production processes for 

5 such good are substantially different 

6 as compared to other covered primary 

7 goods produced within the same cov8 ered national industry, 

9 ‘‘(II) the properties of such good 

10 are distinct such that its uses cannot 

11 be easily replaced by other covered 

12 primary goods produced within the 

13 same covered national industry, and 

14 ‘‘(III) the carbon intensity deter15 mined with respect to such good is at 

16 least 25 percent greater than the car17 bon intensity determined for other 

18 covered primary goods produced with19 in the same covered national industry. 

20 ‘‘(iii) RECALCULATION.—In the case 

21 of any petition described in clause (i) 

22 which is approved by the Secretary pursu23 ant to clause (ii), the Secretary (in coordi24 nation with the Administrator) shall rede25 termine the carbon intensity with respect 

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1 to the covered national industry which in2 cludes production of the covered primary 

3 good which is the subject of such petition 

4 by excluding any covered emissions associ5 ated with the production of such good for 

6 purposes of the determination made under 

7 subparagraph (B) for such industry. 

8 ‘‘(iv) GOODS-LEVEL DATA.—In the 

9 case of any petition described in clause (i) 

10 which is approved by the Secretary pursu11 ant to clause (ii), the Secretary (in coordi12 nation with the Administrator) shall use a 

13 methodology for determining the carbon in14 tensity of the covered primary good (as de15 termined using the eligible facility informa16 tion reported under subsection (a)), and 

17 shall publish the methodology and the re18 sults of such determination, in a manner 

19 which— 

20 ‘‘(I) is compatible with existing 

21 Federal carbon accounting rules and 

22 standards, 

23 ‘‘(II) includes the related chem24 ical, physical, or mechanical produc25 tion processes responsible for difVerDate Sep 11 2014 01:09 Dec 19, 2023 Jkt 049200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H6622.IH H6622
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1 ferences in carbon intensity and cov2 ered emissions, and 

3 ‘‘(III) prioritizes ease of adminis4 tration and compliance. 

5 ‘‘(D) DETERMINATION.—Any determina6 tion of carbon intensity under this paragraph 

7 shall be made by the Secretary in coordination 

8 with the Administrator and the Secretary of 

9 Energy. 

10 ‘‘(2) COVERED EMISSIONS.— 

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

12 subsection, for each calendar year, the amount 

13 of covered emissions with respect to any eligible 

14 facility shall be an amount (as determined by 

15 the Secretary, in coordination with the Admin16 istrator) equal to— 

17 ‘‘(i) the amount equal to the sum of— 

18 ‘‘(I) the total greenhouse gas 

19 emissions associated with the produc20 tion of covered primary goods at such 

21 facility during the preceding calendar 

22 year (as reported pursuant to sub23 section (a)), plus 

24 ‘‘(II) the total greenhouse gas 

25 emissions associated with any elecVerDate Sep 11 2014 01:09 Dec 19, 2023 Jkt 049200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H6622.IH H6622
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1 tricity used at such facility for the 

2 production of such goods during the 

3 preceding calendar year, minus 

4 ‘‘(ii) the total greenhouse gas emis5 sions which are captured and disposed of 

6 in secure geological storage (in compliance 

7 with the regulations established under sec8 tion 45Q(f)(2)) during the preceding cal9 endar year. 

10 ‘‘(B) DIRECT AIR CAPTURE.—For pur11 poses of subparagraph (A)(ii), in the case of 

12 any greenhouse gas emissions which are cap13 tured directly from the ambient air, the oper14 ator of the facility which captured such emis15 sions may apportion such emissions amongst 

16 any eligible facilities which are under common 

17 control of such operator. 

18 ‘‘(C) EMISSIONS FOR ELECTRICITY

19 USED.— 

20 ‘‘(i) IN GENERAL.—For purposes of 

21 subparagraph (A)(i)(II), the amount of 

22 greenhouse gas emissions associated with 

23 electricity provided through the electric 

24 grid shall be determined based on the aver25 age carbon intensity for the regional grid 

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1 in which the eligible facility is located for 

2 the preceding calendar year. 

3 ‘‘(ii) EXCEPTION.—In the case of an 

4 eligible facility which is subject to a power 

5 purchase agreement (or its foreign equiva6 lent) which guarantees that any electricity 

7 provided under such agreement is gen8 erated not less than 15 minutes prior to 

9 use by such facility and within the same 

10 regional transmission zone (or its foreign 

11 equivalent) as such facility— 

12 ‘‘(I) clause (i) shall not apply, 

13 and 

14 ‘‘(II) the amount of greenhouse 

15 gas emissions associated with such 

16 electricity shall be determined based 

17 on the average carbon intensity of the 

18 electricity provided under such agree19 ment. 

20 ‘‘(3) IMPORTED GOODS.— 

21 ‘‘(A) IN GENERAL.—In the case of any 

22 covered primary good which is imported into 

23 the United States, the carbon intensity with re24 spect to such good shall be determined by the 

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1 Secretary (in coordination with the relevant 

2 parties) based on— 

3 ‘‘(i) the carbon intensity of the gen4 eral economy of the country of origin of 

5 such good, or 

6 ‘‘(ii) if the Secretary (in coordination 

7 with the relevant parties) determines that 

8 transparent, verifiable, and reliable infor9 mation is available with respect to any cov10 ered national industry in the country of or11 igin of such good and that such country of 

12 origin is a transparent market economy in 

13 which inter-firm resource shuffling is un14 likely to occur, the carbon intensity of the 

15 covered national industry in such country 

16 which includes production of such good. 

17 ‘‘(B) PETITION.— 

18 ‘‘(i) IN GENERAL.—In the case of any 

19 entity which imports a covered primary 

20 good for which the carbon intensity can be 

21 determined under subparagraph (A)(ii), 

22 such entity may file a petition with the 

23 Secretary to determine the charge under 

24 section 4692, if any, based on the average 

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1 duction of such good by the manufacturer 

2 within the country of origin. 

3 ‘‘(ii) AGGREGATION RULE.—For pur4 poses of this subparagraph, the average 

5 carbon intensity with respect to the pro6 duction of a covered primary good shall be 

7 determined based upon greenhouse gas 

8 emission and production data from all fa9 cilities which produce such good which are 

10 under common control of the manufacturer 

11 of such good, including any subsidiary, 

12 parent company, or joint venture of such 

13 manufacturer within the country of origin. 

14 ‘‘(iii) DATA PROVISION.—In the case 

15 of an entity which files a petition described 

16 in clause (i), such entity shall provide the 

17 Secretary with an environmental product 

18 declaration containing— 

19 ‘‘(I) any information which would 

20 otherwise be required to be reported 

21 under subsection (a) if the facilities 

22 which produced the covered primary 

23 good to which the petition applies 

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1 ments under the Greenhouse Gas Re2 porting Program, and 

3 ‘‘(II) any other information 

4 which is necessary (as determined by 

5 the Secretary, in coordination with the 

6 relevant parties) to calculate the car7 bon intensity of the covered primary 

8 good in accordance with any relevant 

9 methodologies for allocating the car10 bon intensity of the covered primary 

11 good under paragraph (1)(C)(iv). 

12 ‘‘(C) INPUTS.—With respect to any cov13 ered primary good which is imported into the 

14 United States and for which other covered pri15 mary goods (other than petroleum, natural gas, 

16 or coal) were used as inputs by the manufac17 turer in the production of the imported covered 

18 primary good, any greenhouse gas emissions as19 sociated with the production of the covered pri20 mary goods used as inputs shall be included in 

21 the determination of the greenhouse gas emis22 sions associated with production of the im23 ported covered primary good. 

24 ‘‘(D) CARBON INTENSITY OF THE GEN25 ERAL ECONOMY.—For purposes of this paraVerDate Sep 11 2014 01:09 Dec 19, 2023 Jkt 049200 PO 00000 Frm 00014 Fmt 6652 Sfmt 6201 E:\BILLS\H6622.IH H6622
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1 graph, with respect to any country, the carbon 

2 intensity of the general economy of such coun3 try shall be an amount equal to the quotient 

4 of— 

5 ‘‘(i) the greenhouse gas emissions of 

6 such country for the most recent year for 

7 which the Secretary determines there is re8 liable information, divided by 

9 ‘‘(ii) the gross domestic product of 

10 such country for the year described in 

11 clause (i). 

12 ‘‘(E) EXCLUSION.— 

13 ‘‘(i) IN GENERAL.—Subject to clause 

14 (ii), in the case of any covered primary 

15 good (including any covered primary good 

16 which is a component part of a finished 

17 good) which is imported into the United 

18 States and was produced in a relatively 

19 least developed country (as described in 

20 section 124 of the Foreign Assistance Act 

21 of 1961 (22 U.S.C. 2151v)), this para22 graph shall not apply. 

23 ‘‘(ii) EXCEPTION.—Clause (i) shall 

24 not apply if the country described in such 

25 clause produces at least 3 percent of total 

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1 global exports by value of the covered pri2 mary good. 

3 ‘‘(F) INTER-FIRM RESOURCE SHUF4 FLING.—For purposes of this paragraph, the 

5 term ‘inter-firm resource shuffling’ means any 

6 buying, selling, trading, exchanging, or other 

7 transfer of control of production facilities be8 tween entities based on the carbon intensity of 

9 such facilities for the purpose of creating enti10 ties with relatively lower carbon intensity and 

11 entities with relatively higher carbon intensity. 

12 ‘‘(c) PUBLICATION.—The Secretary (in coordination 

13 with the relevant parties) shall— 

14 ‘‘(1) annually publish any carbon intensity 

15 which has been determined under subsection (b) 

16 with respect to any eligible facility, covered national 

17 industry, covered primary good, foreign manufac18 turer, or country of origin, and 

19 ‘‘(2) publish (and update, as appropriate) a list 

20 of— 

21 ‘‘(A) each covered primary good, as cat22 egorized by the covered national industry in 

23 which such good is included, and 

24 ‘‘(B) any covered primary good for which 

25 a petition described in clause (i) of subsection 

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1 (b)(1)(C) has been approved by the Secretary 

2 pursuant to clause (ii) of such subsection. 

3 ‘‘SEC. 4692. IMPOSITION OF CARBON INTENSITY CHARGE. 

4 ‘‘(a) IN GENERAL.— 

5 ‘‘(1) IMPORTATION OF GOODS.— 

6 ‘‘(A) IN GENERAL.— 

7 ‘‘(i) COVERED PRIMARY GOODS.—In 

8 the case of any covered primary good im9 ported into the United States during any 

10 calendar year beginning after December 

11 31, 2024, there is hereby imposed a charge 

12 in an amount (rounded to the nearest dol13 lar) equal to the product of— 

14 ‘‘(I)(aa) in the case of a good for 

15 which the carbon intensity is deter16 mined under section 4691(b)(3)(A)(i), 

17 the amount (if any) by which the 

18 amount determined under clause (iii) 

19 with respect to such good exceeds an 

20 amount equal to the applicable per21 centage of the relevant carbon inten22 sity for such good, or 

23 ‘‘(bb) in the case of a good for 

24 which the carbon intensity is deter25 mined under subparagraph (A)(ii) or 

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1 (B) of section 4691(b)(3), the amount 

2 (if any) by which the carbon intensity 

3 determined under such subparagraph 

4 with respect to such good exceeds an 

5 amount equal to the applicable per6 centage of the relevant carbon inten7 sity for such good, multiplied by 

8 ‘‘(II) the total weight (expressed 

9 in tons) of the good imported into the 

10 United States, multiplied by 

11 ‘‘(III) the carbon price. 

12 ‘‘(ii) FINISHED GOODS.— 

13 ‘‘(I) IN GENERAL.—In the case 

14 of any finished good which is im15 ported into the United States during 

16 any calendar year beginning after De17 cember 31, 2026, there is hereby im18 posed a charge in an amount equal to 

19 the sum of the amounts determined 

20 under subclause (II) with respect to 

21 each covered primary good which is a 

22 component part of such finished good. 

23 ‘‘(II) COMPONENTS.—The 

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1 mary good which is a component part 

2 of a finished good is an amount equal 

3 to the product of— 

4 ‘‘(aa) the amount (if any) 

5 determined under clause (i)(I) if 

6 such clause were applied with re7 spect to such good, multiplied by 

8 ‘‘(bb) the total weight (ex9 pressed in tons) of the covered 

10 primary good, multiplied by 

11 ‘‘(cc) the carbon price. 

12 ‘‘(iii) CALCULATION FOR CERTAIN

13 FOREIGN GOODS.—For purposes of clause 

14 (i)(I)(aa), the amount determined under 

15 this clause with respect to any covered pri16 mary good shall be equal to the product 

17 of— 

18 ‘‘(I) an amount equal to the 

19 quotient of— 

20 ‘‘(aa) the carbon intensity of 

21 the general economy (as deter22 mined under section 

23 4691(b)(3)(D)) of the country of 

24 origin of such good, divided by 

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1 ‘‘(bb) the carbon intensity of 

2 the general economy (as so deter3 mined) of the United States, 

4 multiplied by 

5 ‘‘(II) an amount equal to the ap6 plicable percentage of the relevant 

7 carbon intensity for such good. 

8 ‘‘(B) CHARGE DUE.—The charge imposed 

9 under this paragraph with respect to any goods 

10 imported during any calendar year shall be paid 

11 by the entity which imported such goods not 

12 later than September 30 of the calendar year 

13 subsequent to such year. 

14 ‘‘(C) EXCLUSION.— 

15 ‘‘(i) IN GENERAL.—Subject to clause 

16 (ii), in the case of any covered primary 

17 good (including any covered primary good 

18 which is a component part of a finished 

19 good) which is imported into the United 

20 States and was produced in a relatively 

21 least developed country (as described in 

22 section 124 of the Foreign Assistance Act 

23 of 1961 (22 U.S.C. 2151v)), this para24 graph shall not apply. 

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1 ‘‘(ii) EXCEPTION.—Clause (i) shall 

2 not apply if the country described in such 

3 clause produces at least 3 percent of total 

4 global exports by value of the covered pri5 mary good. 

6 ‘‘(D) CARBON CLUBS.—If the Secretary 

7 (in coordination with the relevant parties) de8 termines that a foreign country has imple9 mented policies which impose explicit costs on 

10 the emission of greenhouse gases which are ma11 terially similar to the charges imposed pursuant 

12 to the provisions of this subchapter, the charge 

13 (or a percentage of the charge which is equiva14 lent to the costs imposed by the foreign coun15 try) which would otherwise be imposed under 

16 this section with respect to covered primary 

17 goods produced in such foreign country may be 

18 waived. 

19 ‘‘(E) RELEVANT CARBON INTENSITY.—In 

20 this paragraph, the term ‘relevant carbon inten21 sity’ means, with respect to any covered pri22 mary good— 

23 ‘‘(i) except as provided in clause (ii), 

24 the carbon intensity (as determined under 

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1 tional industry which includes such good, 

2 or 

3 ‘‘(ii) in the case of any covered pri4 mary good which is included in a petition 

5 described in clause (i) of section 

6 4691(b)(1)(C) which is approved by the 

7 Secretary pursuant to clause (ii) of such 

8 section, the carbon intensity of such good 

9 as determined under such section. 

10 ‘‘(2) DOMESTIC PRODUCTION OF COVERED PRI11 MARY GOODS.— 

12 ‘‘(A) IN GENERAL.—In the case of any eli13 gible facility, for each calendar year beginning 

14 after December 31, 2024, there is hereby im15 posed a charge in an amount (rounded to the 

16 nearest dollar) equal to the product of— 

17 ‘‘(i) the amount (if any) by which the 

18 carbon intensity of such facility (as deter19 mined under subparagraph (A) of section 

20 4691(b)(1)) exceeds— 

21 ‘‘(I) an amount equal to the ap22 plicable percentage of the carbon in23 tensity for the covered national indus24 try (as determined under subpara25 graph (B) of section 4691(b)(1)) 

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1 which includes any covered primary 

2 good produced by such facility, or 

3 ‘‘(II) in the case of a covered pri4 mary good produced by such facility 

5 which is subject to an approved peti6 tion under subparagraph (C) of such 

7 section, an amount equal to the appli8 cable percentage of the carbon inten9 sity determined with respect to such 

10 good, multiplied by 

11 ‘‘(ii) the total weight (expressed in 

12 tons) of any covered primary goods pro13 duced by such facility during such calendar 

14 year, multiplied by 

15 ‘‘(iii) the carbon price. 

16 ‘‘(B) CHARGE DUE.—The charge imposed 

17 under this paragraph with respect to any cal18 endar year shall be paid by the covered entity 

19 not later than September 30 of the calendar 

20 year subsequent to such year. 

21 ‘‘(b) APPLICABLE PERCENTAGE.—For purposes of 

22 paragraphs (1)(A) and (2)(A) of subsection (a), the appli23 cable percentage shall be— 

24 ‘‘(1) for calendar year 2025, 100 percent, 

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1 ‘‘(2) for calendar years 2026 through 2029, the 

2 applicable percentage for the preceding calendar 

3 year, reduced by 2.5 percentage points, and 

4 ‘‘(3) for any calendar year subsequent to cal5 endar year 2029, the applicable percentage for the 

6 preceding calendar year, reduced by 5 percentage 

7 points (but not less than zero). 

8 ‘‘(c) CARBON PRICE.— 

9 ‘‘(1) IN GENERAL.—For purposes of para10 graphs (1)(A) and (2)(A) of subsection (a), the car11 bon price shall be— 

12 ‘‘(A) for 2025, $55, and 

13 ‘‘(B) for each calendar year subsequent to 

14 the calendar year described in subparagraph 

15 (A), an amount equal to the sum of— 

16 ‘‘(i) the carbon price for the preceding 

17 year, plus 

18 ‘‘(ii) an amount equal to— 

19 ‘‘(I) the amount described in 

20 clause (i), multiplied by 

21 ‘‘(II) the percentage by which the 

22 CPI for the preceding calendar year 

23 exceeds the CPI for the second pre24 ceding calendar year, increased by 5 

25 percentage points. 

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1 ‘‘(2) CPI.—Rules similar to the rules of para2 graphs (4) and (5) of section 1(f) shall apply for 

3 purposes of this subsection. 

4 ‘‘(3) ROUNDING.—Any applicable amount de5 termined under this subsection which is not a mul6 tiple of $1 shall be rounded to the nearest dollar. 

7 ‘‘SEC. 4693. REBATE. 

8 ‘‘(a) EXPORTATION OF COVERED PRIMARY GOOD.— 

9 In the case of a person who exports any covered primary 

10 good from the United States which was produced in an 

11 eligible facility for which a charge has been imposed under 

12 section 4692, a refund shall be allowed to such person in 

13 the same manner as if it were an overpayment of the 

14 charge imposed by such section in an amount equal to the 

15 charge that would be imposed under subsection 

16 (a)(1)(A)(i) of such section with respect to such good if 

17 the carbon intensity with respect to such eligible facility 

18 were determined under section 4691(b)(1)(A) by sub19 stituting ‘all eligible facilities by the covered entity which 

20 produced the covered primary good described in section 

21 4693(a)(1)’ for ‘such facility’ each place it appears in such 

22 section. 

23 ‘‘(b) EXPORTATION OF FINISHED GOOD.—In the 

24 case of a person who exports any finished good from the 

25 United States for which a charge has been imposed under 

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1 section 4692 on such finished good or any of its compo2 nents, a refund shall be allowed to such person in the same 

3 manner as if it were an overpayment of the charge im4 posed by such section in an amount equal to the charge 

5 that would otherwise be imposed under such section with 

6 respect to such finished good (as determined pursuant to 

7 subsection (a)(1)(A)(ii) of such section). 

8 ‘‘SEC. 4694. DEFINITIONS. 

9 ‘‘For purposes of this subchapter— 

10 ‘‘(1) ADMINISTRATOR.—The term ‘Adminis11 trator’ means the Administrator of the Environ12 mental Protection Agency. 

13 ‘‘(2) C02-E.— 

14 ‘‘(A) IN GENERAL.—Subject to subpara15 graph (B), the term ‘CO2-e’ means, with re16 spect to a greenhouse gas, the quantity of such 

17 gas that has a global warming potential equiva18 lent to 1 metric ton of carbon dioxide, as deter19 mined pursuant to table A–1 of subpart A of 

20 part 98 of title 40, Code of Federal Regula21 tions, as in effect on the date of the enactment 

22 of this subchapter. 

23 ‘‘(B) METHANE.—In the case of methane, 

24 the term ‘CO2-e’ means the quantity of meth25 ane that has the same global warming potential 

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1 over a 20-year period as 1 metric ton of carbon 

2 dioxide, as determined by the Administrator. 

3 ‘‘(3) COVERED ENTITY.—The term ‘covered en4 tity’ means any entity which— 

5 ‘‘(A) produces any covered primary good, 

6 and 

7 ‘‘(B) is required to report emissions of 

8 greenhouse gases under the Greenhouse Gas 

9 Reporting Program (or would be required to re10 port such emissions notwithstanding any other 

11 provision of law prohibiting the implementation 

12 of or use of funds for such requirements). 

13 ‘‘(4) COVERED NATIONAL INDUSTRY.— 

14 ‘‘(A) IN GENERAL.—Except as provided 

15 under section 4691(b)(1)(B)(ii), the term ‘cov16 ered national industry’ means any industry 

17 which is assigned a 6-digit NAICS code which 

18 is included in any of the following clauses: 

19 ‘‘(i) 211120 (petroleum extraction). 

20 ‘‘(ii) 211130 (natural gas extraction). 

21 ‘‘(iii) 212114 (surface coal mining). 

22 ‘‘(iv) 212115 (underground coal min23 ing). 

24 ‘‘(v) 322110 (pulp mills). 

25 ‘‘(vi) 322120 (paper mills). 

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1 ‘‘(vii) 322130 (paperboard mills). 

2 ‘‘(viii) 324110 (petroleum refineries). 

3 ‘‘(ix) 324121 (asphalt paving mixture 

4 and block manufacturing). 

5 ‘‘(x) 324122 (asphalt shingle and 

6 coating materials manufacturing). 

7 ‘‘(xi) 324199 (all other petroleum and 

8 coal products manufacturing). 

9 ‘‘(xii) 325110 (petrochemical manu10 facturing). 

11 ‘‘(xiii) 325120 (industrial gas manu12 facturing). 

13 ‘‘(xiv) 325193 (ethyl alcohol manufac14 turing). 

15 ‘‘(xv) 325199 (other basic organic 

16 chemical manufacturing). 

17 ‘‘(xvi) 325311 (nitrogenous fertilizer 

18 manufacturing). 

19 ‘‘(xvii) 327211, 327212, 327213, or 

20 327215 (glass). 

21 ‘‘(xviii) 327310 (cement). 

22 ‘‘(xix) 327410 or 327420 (lime and 

23 gypsum product manufacturing). 

24 ‘‘(xx) 331110 (iron and steel). 

25 ‘‘(xxi) 331313 or 331314 (aluminum). 

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1 ‘‘(B) EXCEPTIONS.— 

2 ‘‘(i) INDUSTRIAL GAS MANUFAC3 TURING.—Subparagraph (A)(xiii) shall 

4 apply only with respect to the production 

5 of hydrogen. 

6 ‘‘(ii) OTHER BASIC ORGANIC CHEM7 ICAL MANUFACTURING.—Subparagraph 

8 (A)(xv) shall apply only with respect to the 

9 production of adipic acid. 

10 ‘‘(5) COVERED PRIMARY GOOD.—The term ‘cov11 ered primary good’ means any good which is pro12 duced as part of a trade or business operating with13 in a covered national industry, and includes (except 

14 as otherwise provided under section 4691(b)(1)(C)) 

15 any good classifiable under the same 6-digit sub16 heading of the Harmonized Tariff Schedule of the 

17 United States. 

18 ‘‘(6) ELIGIBLE FACILITY.—The term ‘eligible 

19 facility’ means any facility (as such term is defined 

20 for purposes of the Greenhouse Gas Reporting Pro21 gram) which is— 

22 ‘‘(A) operated by a covered entity for the 

23 production of any covered primary good, and 

24 ‘‘(B) located within the United States. 

25 ‘‘(7) FINISHED GOOD.— 

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

2 good’ means any good which— 

3 ‘‘(i) for calendar years 2027 and 

4 2028— 

5 ‘‘(I) contains greater than 500 

6 pounds of any combination of any cov7 ered primary goods, or 

8 ‘‘(II) was produced from inputs 

9 of any combination of covered primary 

10 goods, the value of which comprise 

11 more than 90 percent of the total 

12 value of the material inputs involved 

13 in the production of such good, 

14 ‘‘(ii) for calendar years 2029 and 

15 2030— 

16 ‘‘(I) contains greater than 100 

17 pounds of any combination of any cov18 ered primary goods, or 

19 ‘‘(II) was produced from inputs 

20 of any combination of covered primary 

21 goods, the value of which comprise 

22 more than 75 percent of the total 

23 value of the material inputs involved 

24 in the production of such good, and 

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1 ‘‘(iii) for any calendar year after cal2 endar year 2030— 

3 ‘‘(I) contains greater than such 

4 amount as is determined by the Sec5 retary (as determined in coordination 

6 with the relevant parties, and which 

7 shall not be greater than 100 pounds) 

8 of any combination of any covered pri9 mary goods, or 

10 ‘‘(II) was produced from inputs 

11 of any combination of covered primary 

12 goods, the value of which comprise 

13 more than such percentage as is de14 termined by the Secretary (as deter15 mined in coordination with the rel16 evant parties, and which shall not be 

17 greater than 75 percent) of the total 

18 value of the material inputs involved 

19 in the production of such good. 

20 ‘‘(B) EXCEPTION .—The term ‘finished 

21 good’ shall not include any waste or scrap prod22 uct which is imported or exported. 

23 ‘‘(8) GREENHOUSE GAS.—The term ‘greenhouse 

24 gas’ has the meaning given such term under section 

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1 211(o)(1)(G) of the Clean Air Act, as in effect on 

2 the date of the enactment of this subchapter. 

3 ‘‘(9) GREENHOUSE GAS EMISSIONS.—The term 

4 ‘greenhouse gas emissions’ means the amount of 

5 greenhouse gases, expressed in metric tons of CO2- 

6 e, which were emitted to the atmosphere. 

7 ‘‘(10) GREENHOUSE GAS REPORTING PRO8 GRAM.—The term ‘Greenhouse Gas Reporting Pro9 gram’ means the Greenhouse Gas Reporting Pro10 gram established under part 98 of title 40, Code of 

11 Federal Regulations. 

12 ‘‘(11) NAICS.—The term ‘NAICS’ means the 

13 North American Industrial Classification System. 

14 ‘‘(12) REGIONAL GRID.—The term ‘regional 

15 grid’ means the smallest defined region of inter16 connected power grid (including power generation 

17 assets) from which a facility draws power that ac18 counts for the total power supplied to the facility by 

19 the grid and for which there is reliable data. 

20 ‘‘(13) RELEVANT PARTIES.—The term ‘relevant 

21 parties’ means— 

22 ‘‘(A) the Administrator, 

23 ‘‘(B) the Secretary of Energy, 

24 ‘‘(C) the Secretary of Commerce, 

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1 ‘‘(D) the United States Trade Representa2 tive, and 

3 ‘‘(E) the Chair and Vice Chair of the 

4 United States International Trade Commis5 sion.’’. 

6 (b) CLERICAL AMENDMENT.—The table of sub7 chapters for chapter 38 of the Internal Revenue Code of 

8 1986 is amended by adding at the end thereof the fol9 lowing new item: 

‘‘SUBCHAPTER E—CARBON INTENSITY CHARGE’’. 

10 (c) GRANT PROGRAM.— 

11 (1) IN GENERAL.—For fiscal year 2026 and 

12 each subsequent fiscal year, there are appropriated, 

13 out of any funds in the Treasury not otherwise ap14 propriated, to the Department of the Treasury 

15 amounts equal to applicable amount for the pre16 ceding fiscal year, with such amounts to be used by 

17 the Secretary, in conjunction with the Secretary of 

18 Energy and the Administrator of the Environmental 

19 Protection Agency, to establish a competitive grant 

20 program to award grants to eligible entities for in21 vestments in new technology— 

22 (A) in the case of an existing eligible facil23 ity, to reduce their carbon intensity, and 

24 (B) in the case of a proposed eligible facil25 ity, to ensure best-in-class carbon intensity. 

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1 (2) MODELED ON DIESEL EMISSIONS REDUC2 TION ACT.—For purposes of the program described 

3 in paragraph (1), such program shall be adminis4 tered in a manner similar to the national grant pro5 gram of the Environmental Protection Agency under 

6 subtitle G of title VII of the Energy Policy Act of 

7 2005 (42 U.S.C. 16131 et seq.). 

8 (3) AWARDING OF GRANT AMOUNTS.—For pur9 poses of awarding grants under the program de10 scribed in paragraph (1), the Secretary (in conjunc11 tion with the Administrator and the Secretary of 

12 Energy) shall— 

13 (A) give preference to proposed invest14 ments— 

15 (i) that would result in the greatest 

16 decrease in carbon intensity, 

17 (ii) for facilities located in economi18 cally distressed communities that have ex19 perienced a loss of manufacturing jobs, 

20 (iii) that would maximize improve21 ment in local air quality, or 

22 (iv) for facilities located in commu23 nities with high cumulative pollution bur24 dens (as determined by the Administrator), 

25 and 

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1 (B) allocate grant funds to eligible facili2 ties and proposed eligible facilities which 

3 produce covered primary goods that are in4 cluded within a covered national industry in ap5 proximate proportion to the share of total 

6 greenhouse gas emissions for which such indus7 try is responsible for emitting. 

8 (4) RECAPTURE.—In the case of any eligible 

9 entity which has been awarded a grant under the 

10 program described in paragraph (1) with respect to 

11 any eligible facility or proposed eligible facility, if 

12 such entity fails to— 

13 (A) within 3 years of the awarding of such 

14 grant, complete the proposed investments in 

15 new technology at such facility, or 

16 (B) during the 10-year period after such 

17 investments are placed in service— 

18 (i) in the case of an existing eligible 

19 facility, achieve and maintain the reduction 

20 in carbon intensity proposed in the applica21 tion for such grant, or 

22 (ii) in the case of a proposed eligible 

23 facility, achieve and maintain the best-in24 class carbon intensity proposed in the ap25 plication for such grant, 

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•HR 6622 IH

1 the Secretary shall recapture, pursuant to such reg2 ulations or other guidance issued by the Secretary, 

3 the amount of the grant awarded with respect to 

4 such facility. 

5 (5) APPLICABLE AMOUNT.—For purposes of 

6 this subsection, the term ‘‘applicable amount’’ 

7 means, with respect to any fiscal year, an amount 

8 equal to 75 percent of the increase in revenues to 

9 the Treasury during such fiscal year by reason of 

10 the application of subchapter E of chapter 38 of the 

11 Internal Revenue Code of 1986 (as added by sub12 section (a)). 

13 (6) DEFINITIONS.—For purposes of this sub14 section— 

15 (A) IN GENERAL.—The terms ‘‘covered na16 tional industry’’, ‘‘eligible facility’’, and ‘‘cov17 ered primary good’’ shall have the same mean18 ing given such terms under section 4694 of the 

19 Internal Revenue Code of 1986 (as added by 

20 subsection (a)). 

21 (B) BEST-IN-CLASS CARBON INTENSITY.— 

22 The term ‘‘best-in-class carbon intensity’’ 

23 means, with respect to any proposed eligible fa24 cility, that the carbon intensity of such facility 

25 would be not greater than the carbon intensity 

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1 of the existing facility with the lowest carbon 

2 intensity within the relevant covered national 

3 industry (as determined of the date of the ap4 plication for a grant under the program de5 scribed in paragraph (1)). 

6 (C) ELIGIBLE ENTITY.—The term ‘‘eligible 

7 entity’’ means any person which operates an eli8 gible facility or will operate a proposed eligible 

9 facility. 

10 (D) SECRETARY.—The term ‘‘Secretary’’ 

11 means the Secretary of the Treasury (or the 

12 Secretary’s delegate). 

13 (d) ECONOMIC SUPPORT FUND OF DEPARTMENT OF

14 STATE.— 

15 (1) IN GENERAL.—For fiscal year 2026 and 

16 each subsequent fiscal year, in addition to amounts 

17 otherwise available, there are appropriated, out of 

18 any funds in the Treasury not otherwise appro19 priated, to the Department of State an amount 

20 equal to the applicable amount for the preceding fis21 cal year, with such amount to be made available for 

22 bilateral and multilateral assistance to support cli23 mate and clean energy programs. 

24 (2) APPLICABLE AMOUNT.—For purposes of 

25 this subsection, the term ‘‘applicable amount’’ 

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1 means, with respect to any fiscal year, an amount 

2 equal to 25 percent of the increase in revenues to 

3 the Treasury during such fiscal year by reason of 

4 the application of subchapter E of chapter 38 of the 

5 Internal Revenue Code of 1986 (as added by sub6 section (a)). 

Æ