I 

111TH CONGRESS 

2D SESSION H. R. 6343 

To authorize the Secretary of Agriculture to make loans to qualified projects 

for the production of renewable source jet fuel. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 29, 2010 

Mr. INSLEE introduced the following bill; which was referred to the Committee 

on Energy and Commerce 

A BILL 

To authorize the Secretary of Agriculture to make loans 

to qualified projects for the production of renewable 

source jet fuel. 

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, Renewable Jet 

5 Fuel Act’’. 

6 SEC. 2. LOANS FOR QUALIFYING JET FUEL PRODUCTION 

7 PROJECTS. 

8 (a) DEFINITIONS.—In this section: 

9 (1) DIRECT LOAN.—The term ‘‘direct loan’’ has 

10 the meaning given the term in section 502(1) of the 


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1 Federal Credit Reform Act of 1990 (2 U.S.C. 

2 661a(1)). 

3 (2) LIFECYCLE GREENHOUSE GAS EMIS4 SIONS.—The term ‘‘lifecycle greenhouse gas emis5 sions’’ means an amount of emissions determined 

6 though the same methodology used by the Environ7 mental Protection Agency to evaluate lifecycle green8 house gas emissions under section 211(o) of the 

9 Clean Air Act (42 U.S.C. 7545). 

10 (3) MARKET PRICE.—The term ‘‘market price’’ 

11 means the weekly average closing price of the front 

12 month contract for West Texas Intermediate futures 

13 on the New York Mercantile Exchange. 

14 (4) QUALIFYING JET FUEL PROJECT.—The 

15 term ‘‘qualifying jet fuel project’’ means a project lo16 cated in the United States that produces at least 

17 25,000,000 gallons per year of liquid aviation tur18 bine fuel or blending component that— 

19 (A) as produced has at least 50 percent 

20 less lifecycle greenhouse gas emissions than pe21 troleum; 

22 (B) is produced from renewable biomass, 

23 as defined in section 211(o)(1)(I) of the Clean 

24 Air Act (42 U.S.C. 7545(o)(1)(I)); and 


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1 (C) meets, or can be blended with other 

2 components to produce a fuel that meets, an 

3 American Society of Testing and Materials 

4 (ASTM) standard for aviation turbine fuels. 

5 (5) SALES.—The term ‘‘sales’’ means the vol6 ume of jet fuel described in paragraph (4) that has 

7 been sold to the open market after being produced 

8 from a project, as specified in an agreement entered 

9 into under subsection (b). 

10 (6) SECRETARY.—The term ‘‘Secretary’’ means 

11 the Secretary of Agriculture. 

12 (7) STRIKE PRICE.—The term ‘‘strike price’’ 

13 means a specified price below which the United 

14 States shall make payments in the form of a loan to 

15 the owner or operator of a qualified jet fuel project 

16 and above which the owner or operator of a qualified 

17 jet fuel project shall repay the loan under the terms 

18 specified by an agreement entered into under sub19 section (b). 

20 (b) LOANS.— 

21 (1) LOAN AUTHORITY.—The Secretary shall 

22 enter into a standby loan agreement under this sec23 tion with the owners or operators of not more than 

24 10 qualifying jet fuel projects. Such an agreement 

25 shall— 


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1 (A) provide that the Secretary shall make 

2 a direct loan for the project; 

3 (B) define the primary term of the agree4 ment, which shall not exceed the lesser of 10 

5 years or 75 percent of the projected useful life 

6 of the project (as determined by the Secretary); 

7 and 

8 (C) define the full term of the agreement, 

9 which shall not exceed the lesser of 20 years or 

10 90 percent of the project useful life of the 

11 project (as determined by the Secretary). 

12 (2) STRIKE PRICE METHODOLOGY.—The strike 

13 price shall be determined by an auction process. The 

14 Secretary shall conduct 3 auctions over a period of 

15 2 years. The 3 auctions shall be structured in order 

16 to ensure, to the maximum extent possible, that 

17 number of projects awarded under each auction is 

18 the same. 

19 (3) LOAN DISBURSEMENTS.—A loan made 

20 under this section shall be disbursed during the pri21 mary term of the loan agreement whenever the mar22 ket price falls below the strike price. The amount of 

23 such disbursement shall be equal to the excess of the 

24 strike price over the market price in each given 

25 week, times the sales of the project for the following 


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1 week (but not more than a total level of disburse2 ments specified in the agreement). 

3 (4) LOAN REPAYMENTS.—The Secretary shall 

4 establish terms and conditions, including interest 

5 rates and amortization schedules, for the repayment 

6 of such loan within the full term of the loan agree7 ment, subject to the following limitations: 

8 (A) In any calendar quarter during the 

9 primary term of the agreement the loan recipi10 ent may elect to defer some or all of its repay11 ment obligations due in that quarter if any new 

12 loan disbursements have been made in that 

13 quarter. Any unpaid obligations will continue to 

14 accrue interest. 

15 (B) If in any calendar quarter during the 

16 primary term of the agreement the market price 

17 is greater than the strike price, the loan recipi18 ent shall meet its scheduled repayment obliga19 tion plus deferred repayment obligations, but 

20 shall not be required to pay in that quarter an 

21 amount that is more than the excess of the 

22 market price over the strike price, times the 

23 output of the project. 

24 (C) Unless the Secretary determines other25 wise, at the end of the primary term of the 


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1 agreement, the cumulative amount of any re2 maining repayment obligations, together with 

3 accrued interest, shall be amortized (with inter4 est) over the remainder of the full term of the 

5 agreement. 

6 (c) COMPLIANCE WITH FEDERAL CREDIT REFORM

7 ACT.—Loans under this section shall be subject to the re8 quirements of the Federal Credit Reform Act of 1990. 

Æ 


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