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[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5437 Introduced in House (IH)]

110th CONGRESS
  2d Session
                                H. R. 5437

To promote alternative and renewable fuels, domestic energy production, 
conservation, and efficiency, to increase American energy independence, 
                        and for other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                           February 14, 2008

  Mr. Ross (for himself and Mr. Nunes) introduced the following bill; 
  which was referred to the Committee on Energy and Commerce, and in 
  addition to the Committees on Science and Technology, Oversight and 
Government Reform, Armed Services, Agriculture, Natural Resources, and 
   Ways and Means, 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 promote alternative and renewable fuels, domestic energy production, 
conservation, and efficiency, to increase American energy independence, 
                        and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``American-Made 
Energy Act of 2008''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
    TITLE I--TAX INCENTIVES FOR ALTERNATIVE ENERGY AND CONSERVATION

                     Subtitle A--Alternative Energy

Sec. 101. Credit for investment in cellulosic biomass ethanol projects.
Sec. 102. Investment tax credit for investments in nuclear power 
                            facilities.
Sec. 103. Expansion of special allowance to cellulosic biomass alcohol 
                            fuel plant property.
                 Subtitle B--Electricity and Renewables

Sec. 111. Extension and modification of energy investment tax credit.
Sec. 112. Credit rate parity for all renewable resources under 
                            electricity production credit.
Sec. 113. Extension of credit for producing electricity from certain 
                            renewable resources.
Sec. 114. Expansion of credit for electricity produced from 
                            agricultural livestock waste nutrients.
Sec. 115. Credit for installation of wind energy property including by 
                            rural homeowners, farmers, ranchers, and 
                            small businesses.
Sec. 116. 3-year accelerated depreciation period for wind energy 
                            property.
Sec. 117. Repeal of dollar limitation and allowance against alternative 
                            minimum tax for residential solar and fuel 
                            cell property credit.
Sec. 118. New clean renewable energy bonds.
Sec. 119. Extension and modification of credit for residential energy 
                            efficient property.
                    Subtitle C--Coal-to-Liquid Fuel

Sec. 121. Extension of alternative fuel credit for fuel derived from 
                            coal.
                     Subtitle D--Energy Efficiency

Sec. 131. Extension of new energy efficient home credit.
Sec. 132. Modification and extension of energy efficient commercial 
                            buildings deduction.
                 Subtitle E--Alternative Vehicle Fuels

Sec. 141. Consumer credit for purchase of flexible fuel motor vehicle.
Sec. 142. Repeal of prohibition on procurement and acquisition of 
                            alternative fuels.
                     Subtitle F--Biofuel Production

Sec. 151. Extension and modification of credits for biodiesel and 
                            renewable diesel.
                   Subtitle G--Oil and Gas Provisions

Sec. 161. Expensing for crude oil refineries.
Sec. 162. Extension of suspension of taxable income limit on percentage 
                            depletion for oil and natural gas produced 
                            from marginal properties.
Sec. 163. Increase in depletion rate for marginal oil or gas 
                            production.
Sec. 164. Suspension of taxable income limitation on percentage 
                            depletion.
Sec. 165. Study on fair and transparent fuel pricing.
              Subtitle H--Carbon Capture and Sequestration

Sec. 171. Expansion and modification of advanced coal project 
                            investment credit.
               TITLE II--AMERICAN-MADE ENERGY TRUST FUND

Sec. 201. Establishment of American-Made Energy Trust Fund.
TITLE III--DEVELOPMENT OF OIL AND GAS RESOURCES OF THE COASTAL PLAIN OF 
                                 ALASKA

Sec. 301. Definitions.
Sec. 302. Leasing program for lands within the Coastal Plain.
Sec. 303. Lease sales.
Sec. 304. Grant of leases by the Secretary.
Sec. 305. Lease terms and conditions.
Sec. 306. Coastal plain environmental protection.
Sec. 307. Expedited judicial review.
Sec. 308. Federal and State distribution of revenues.
Sec. 309. Rights-of-way across the Coastal Plain.
Sec. 310. Conveyance.
Sec. 311. Local government impact aid and community service assistance.
                TITLE IV--COAL-TO-LIQUID FUEL PROMOTION

Sec. 401. Strategic Petroleum Reserve.
Sec. 402. Procurement of unconventional fuels by the Department of 
                            Defense.
Sec. 403. Government auction of long term put option contracts on coal-
                            to-liquid fuel produced by qualified coal-
                            to-liquid facilities.
Sec. 404. Definitions.
                        TITLE V--BIOFUEL PROGRAM

Sec. 501. Grants for cellulosic ethanol production.
Sec. 502. Loan guarantees for biorefineries and biofuel production 
                            plants.
Sec. 503. Biomass Research and Development Act of 2000.
Sec. 504. Forest bioenergy research program.
Sec. 505. Early action renewable fuel marketing.
                  TITLE VI--ALTERNATIVE VEHICLE FUELS

Sec. 601. Credit for plug-in hybrid vehicles.
Sec. 602. Use of credits.
                TITLE VII--OFFSHORE OIL AND GAS LEASING

Sec. 701. Termination of prohibitions on expenditures for, and 
                            withdrawals from, offshore leasing.
Sec. 702. Outer Continental Shelf leasing program.
Sec. 703. Sharing of revenues.
        TITLE VIII--INCREASING NUCLEAR GENERATED ELECTRIC ENERGY

Sec. 801. Increasing nuclear generated electric energy.

    TITLE I--TAX INCENTIVES FOR ALTERNATIVE ENERGY AND CONSERVATION

                     Subtitle A--Alternative Energy

SEC. 101. CREDIT FOR INVESTMENT IN CELLULOSIC BIOMASS ETHANOL PROJECTS.

    (a) Qualifying Cellulosic Biomass Ethanol Project Investment.--
            (1) In general.--Subpart E of part IV of subchapter A of 
        chapter 1 of the Internal Revenue Code of 1986 (relating to 
        rules for computing investment credit) is amended by inserting 
        after section 48B the following new section:

``SEC. 48C. QUALIFYING CELLULOSIC BIOMASS ETHANOL PROJECT CREDIT.

    ``(a) In General.--For purposes of section 46, the qualifying 
cellulosic biomass ethanol project credit for any taxable year is an 
amount equal to 50 percent of the qualified investment for such taxable 
year.
    ``(b) Dollar Limitation.--The amount of the credit determined under 
this section for any taxable year shall not exceed $100,000,000.
    ``(c) Qualified Investment.--For purposes of subsection (a), the 
qualified investment for any taxable year is the basis of property 
placed in service by the taxpayer during the taxable year which is part 
of a qualifying cellulosic biomass ethanol project--
            ``(1)(A) the construction, reconstruction, or erection of 
        which is completed by the taxpayer, or
            ``(B) which is acquired by the taxpayer if the original use 
        of such property commences with the taxpayer, and
            ``(2) with respect to which depreciation (or amortization 
        in lieu of depreciation) is allowable.
    ``(d) Qualifying Cellulosic Biomass Ethanol Project.--For purposes 
of this section, the term `qualifying cellulosic biomass ethanol 
project' means any domestic project which produces not less than 
5,000,000 gallons of ethanol per year by enzymatic hydrolysis of any 
lignocellulosic or hemicellulosic feedstock that is available on a 
renewable or recurring basis, including agricultural residues, 
agricultural fibers, dedicated energy crops, grasses, plants, and wood 
and wood residues.
    ``(e) Qualifying Cellulosic Biomass Ethanol Project Program.--
            ``(1) In general.--The Secretary, in consultation with the 
        Secretary of Energy, shall establish a qualifying cellulosic 
        biomass ethanol project program to consider and award 
        certifications for qualified investment eligible for credits 
        under this section to qualifying cellulosic biomass ethanol 
        project sponsors under this section. The total amounts of 
        credit that may be allocated under this program shall not 
        exceed $2,000,000,000.
            ``(2) Selection criteria.--The Secretary shall not make a 
        competitive certification award for qualified investment for 
        credit eligibility under this section unless the recipient has 
        documented to the satisfaction of the Secretary that--
                    ``(A) the proposal of the award recipient is 
                financially viable,
                    ``(B) the recipient will provide sufficient 
                information to the Secretary for the Secretary to 
                ensure that the qualified investment is spent 
                efficiently and effectively,
                    ``(C) the award recipient's project team is 
                competent in the planning and construction of 
                cellulosic biomass ethanol facilities, and
                    ``(D) the award recipient has met other criteria 
                established and published by the Secretary.
            ``(3) Period of certification.--The Secretary may issue the 
        certifications described in paragraph (1) during the 10-year 
        period beginning on October 1, 2008.
    ``(f) Denial of Double Benefit.--No deduction or other credit shall 
be allowed with respect to the basis of any property taken into account 
in determining the credit allowed under this section.''.
    (b) Conforming Amendments.--
            (1) Section 46 of such Code is amended by striking ``and'' 
        at the end of paragraph (3), by striking the period at the end 
        of paragraph (4) and inserting ``, and'', and by adding at the 
        end the following new paragraph:
            ``(5) the qualifying cellulosic biomass ethanol project 
        credit.''.
            (2) The table of sections for subpart E of part IV of 
        subchapter A of chapter 1 of such Code is amended by inserting 
        after the item relating to section 48B the following new item:

``Sec. 48C. Qualifying cellulosic biomass ethanol project.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to qualified investment made after the date of the enactment of 
this Act.

SEC. 102. INVESTMENT TAX CREDIT FOR INVESTMENTS IN NUCLEAR POWER 
              FACILITIES.

    (a) New Credit for Nuclear Power Facilities.--Section 46 of the 
Internal Revenue Code of 1986, as amended by this Act, is amended by--
            (1) striking ``and'' at the end of paragraph (4);
            (2) striking the period at the end of paragraph (5) and 
        inserting ``, and''; and
            (3) inserting after paragraph (5) the following new 
        paragraph:
            ``(6) the nuclear power facility construction credit.''.
    (b) Nuclear Power Facility Construction Credit.--Subpart E of part 
IV of subchapter A of chapter 1 of such Code, as amended by this Act, 
is amended by inserting after section 48C the following new section:

``SEC. 48D. NUCLEAR POWER FACILITY CONSTRUCTION CREDIT.

    ``(a) In General.--For purposes of section 46, the nuclear power 
facility construction credit for any taxable year is 20 percent of the 
qualified nuclear power facility expenditures with respect to a 
qualified nuclear power facility.
    ``(b) When Expenditures Taken Into Account.--
            ``(1) In general.--Qualified nuclear power facility 
        expenditures shall be taken into account for the taxable year 
        in which the qualified nuclear power facility is placed in 
        service.
            ``(2) Coordination with subsection (c).--The amount which 
        would (but for this paragraph) be taken into account under 
        paragraph (1) with respect to any qualified nuclear power 
        facility shall be reduced (but not below zero) by any amount of 
        qualified nuclear power facility expenditures taken into 
        account under subsection (c) by the taxpayer or a predecessor 
        of the taxpayer (or, in the case of a sale and leaseback 
        described in section 50(a)(2)(C), by the lessee), to the extent 
        any amount so taken into account has not been required to be 
        recaptured under section 50(a).
    ``(c) Progress Expenditures.--
            ``(1) In general.--A taxpayer may elect to take into 
        account qualified nuclear power facility expenditures--
                    ``(A) Self-constructed property.--In the case of a 
                qualified nuclear power facility which is a self-
                constructed facility, in the taxable year for which 
                such expenditures are properly chargeable to capital 
                account with respect to such facility.
                    ``(B) Acquired facility.--In the case of a 
                qualified nuclear facility which is not self-
                constructed property, in the taxable year in which such 
                expenditures are paid.
            ``(2) Special rules for applying paragraph (1).--For 
        purposes of paragraph (1)--
                    ``(A) Component parts, etc.--Property which is not 
                self-constructed property and which is to be a 
                component part of, or is otherwise to be included in, 
                any facility to which this subsection applies shall be 
                taken into account in accordance with paragraph (1)(B).
                    ``(B) Certain borrowing disregarded.--Any amount 
                borrowed directly or indirectly by the taxpayer on a 
                nonrecourse basis from the person constructing the 
                facility for the taxpayer shall not be treated as an 
                amount expended for such facility.
                    ``(C) Limitation for facilities or components which 
                are not self-constructed.--
                            ``(i) In general.--In the case of a 
                        facility or a component of a facility which is 
                        not self-constructed, the amount taken into 
                        account under paragraph (1)(B) for any taxable 
                        year shall not exceed the amount which 
                        represents the portion of the overall cost to 
                        the taxpayer of the facility or component of a 
                        facility which is properly attributable to the 
                        portion of the facility or component which is 
                        completed during such taxable year.
                            ``(ii) Carry-over of certain amounts.--In 
                        the case of a facility or component of a 
                        facility which is not self-constructed--
                                    ``(I) if the amount which (but for 
                                clause (i)) would have been taken into 
                                account under paragraph (1)(B) for the 
                                taxable year exceeds the limitation of 
                                clause (i), then the amount of such 
                                excess shall be taken into account 
                                under paragraph (1)(B) for the 
                                succeeding taxable year, and
                                    ``(II) if the limitation of clause 
                                (i) for the taxable year exceeds the 
                                amount taken into account under 
                                paragraph (1)(B), then the amount of 
                                such excess shall increase the 
                                limitation of clause (i) for the 
                                succeeding taxable year.
                    ``(D) Determination of percentage of completion.--
                The determination under subparagraph (C)(i) of the 
                portion of the overall cost to the taxpayer of the 
                construction which is properly attributable to 
                construction completed during any taxable year shall be 
                made on the basis of engineering or architectural 
                estimates or on the basis of cost accounting records. 
                Unless the taxpayer establishes otherwise by clear and 
                convincing evidence, the construction shall be deemed 
                to be completed not more rapidly than ratably over the 
                normal construction period.
                    ``(E) No progress expenditures for certain prior 
                periods.--No qualified nuclear facility expenditures 
                shall be taken into account under this subsection for 
                any period before the first day of the first taxable 
                year to which an election under this subsection 
                applies.
                    ``(F) No progress expenditures for property for 
                year it is placed in service, etc.--In the case of any 
                qualified nuclear facility, no qualified nuclear 
                facility expenditures shall be taken into account under 
                this subsection for the earlier of--
                            ``(i) the taxable year in which the 
                        facility is placed in service, or
                            ``(ii) the first taxable year for which 
                        recapture is required under section 50(a)(2) 
                        with respect to such facility, or for any 
                        taxable year thereafter.
            ``(3) Self-constructed.--For purposes of this subsection--
                    ``(A) The term `self-constructed facility' means 
                any facility if it is reasonable to believe that more 
                than half of the qualified nuclear facility 
                expenditures for such facility will be made directly by 
                the taxpayer.
                    ``(B) A component of a facility shall be treated as 
                not self-constructed if the cost of the component is at 
                least 5 percent of the expected cost of the facility 
                and the component is acquired by the taxpayer.
            ``(4) Election.--An election shall be made under this 
        section for a qualified nuclear power facility by claiming the 
        nuclear power facility construction credit for expenditures 
        described in paragraph (1) on a tax return filed by the due 
        date for such return (taking into account extensions). Such an 
        election shall apply to the taxable year for which made and all 
        subsequent taxable years. Such an election, once made, may be 
        revoked only with the consent of the Secretary.
    ``(d) National Limitation on Amount of Investments Designated.--
Subsection (a) shall not apply to the extent that the aggregate nuclear 
power facility construction credit allowed under such subsection 
exceeds $2,000,000,000.
    ``(e) Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Qualified nuclear power facility.--The term 
        `qualified nuclear power facility' means an advanced nuclear 
        power facility (as defined in section 45J), the construction of 
        which was approved by the Nuclear Regulatory Commission on or 
        before December 31, 2013.
            ``(2) Qualified nuclear power facility expenditures.--
                    ``(A) In general.--The term `qualified nuclear 
                power facility expenditures' means any amount properly 
                chargeable to capital account--
                            ``(i) with respect to a qualified nuclear 
                        power facility,
                            ``(ii) for which depreciation is allowable 
                        under section 168, and
                            ``(iii) which are incurred before the 
                        qualified nuclear power facility is placed in 
                        service or in connection with the placement of 
                        such facility in service.
                    ``(B) Pre-effective date expenditures.--Qualified 
                nuclear power facility expenditures do not include any 
                expenditures incurred by the taxpayer before January 1, 
                2008, unless such expenditures constitute less than 20 
                percent of the total qualified nuclear power facility 
                expenditures (determined without regard to this 
                subparagraph) for the qualified nuclear power facility.
            ``(3) Delays and suspension of construction.--
                    ``(A) In general.--For purposes of applying this 
                section and section 50, a nuclear power facility that 
                is under construction shall cease to be treated as a 
                facility that will be a qualified nuclear power 
                facility as of the earlier of--
                            ``(i) the date on which the taxpayer 
                        decides to terminate construction of the 
                        facility, or
                            ``(ii) the last day of any 24 month period 
                        in which the taxpayer has failed to incur 
                        qualified nuclear power facility expenditures 
                        totaling at least 20 percent of the expected 
                        total cost of the nuclear power facility.
                    ``(B) Authority to waive.--The Secretary may waive 
                the application of clause (ii) of subparagraph (A) if 
                the Secretary determines that the taxpayer intended to 
                continue the construction of the qualified nuclear 
                power facility and the expenditures were not incurred 
                for reasons outside the control of the taxpayer.
                    ``(C) Resumption of construction.--If a nuclear 
                power facility that is under construction ceases to be 
                a qualified nuclear power facility by reason of 
                paragraph (2) and work is subsequently resumed on the 
                construction of such facility--
                            ``(i) the date work is subsequently resumed 
                        shall be treated as the date that construction 
                        began for purposes of paragraph (1), and
                            ``(ii) if the facility is a qualified 
                        nuclear power facility, the qualified nuclear 
                        power facility expenditures shall be determined 
                        without regard to any delay or temporary 
                        termination of construction of the facility.''.
    (c) Provisions Relating to Credit Recapture.--
            (1) Progress expenditure recapture rules.--
                    (A) Basic rules.--Subparagraph (A) of section 
                50(a)(2) of such Code is amended to read as follows:
                    ``(A) In general.--If during any taxable year any 
                building to which section 47(d) applied or any facility 
                to which section 48D(c) applied ceases (by reason of 
                sale or other disposition, cancellation or abandonment 
                of contract, or otherwise) to be, with respect to the 
                taxpayer, property which, when placed in service, will 
                be a qualified rehabilitated building or a qualified 
                nuclear power facility, then the tax under this chapter 
                for such taxable year shall be increased by an amount 
                equal to the aggregate decrease in the credits allowed 
                under section 38 for all prior taxable years which 
                would have resulted solely from reducing to zero the 
                credit determined under this subpart with respect to 
                such building or facility.''.
                    (B) Amendment to excess credit recapture rule.--
                Subparagraph (B) of section 50(a)(2) of such Code is 
                amended by--
                            (i) inserting ``or paragraph (2) of section 
                        48D(b)'' after ``paragraph (2) of section 
                        47(b)'',
                            (ii) inserting ``or section 48D(b)(1)'' 
                        after ``section 47(b)(1)'', and
                            (iii) inserting ``or facility'' after 
                        ``building''.
                    (C) Amendment of sale and leaseback rule.--
                Subparagraph (C) of section 50(a)(2) of such Code is 
                amended by--
                            (i) inserting ``or qualified nuclear power 
                        facility expenditures'' after ``qualified 
                        rehabilitation expenditures'', and
                            (ii) inserting ``or section 48D(c)'' after 
                        ``section 47(d)''.
                    (D) Other amendment.--Subparagraph (D) of section 
                50(a)(2) of such Code is amended by inserting ``or 
                section 48D(c)'' after ``section 47(d)''.
    (d) No Basis Adjustment.--Section 50(c) of such Code is amended by 
inserting at the end thereof the following new paragraph:
            ``(6) Nuclear power facility construction credit.--
        Paragraphs (1) and (2) shall not apply to the nuclear power 
        facility construction credit.''.
    (e) Technical Amendments.--The table of sections for subpart E of 
part IV of subchapter A of chapter 1 of such Code is amended by 
inserting after the item relating to section 48C the following new 
item:

``Sec. 48D. Nuclear power facility construction credit.''.
    (f) Effective Date.--The amendments made by this section shall be 
effective for expenditures incurred and property placed in service in 
taxable years beginning after the date of the enactment of this Act.

SEC. 103. EXPANSION OF SPECIAL ALLOWANCE TO CELLULOSIC BIOMASS ALCOHOL 
              FUEL PLANT PROPERTY.

    (a) In General.--Paragraph (3) of section 168(l) of the Internal 
Revenue Code of 1986 (relating to special allowance for cellulosic 
biomass ethanol plant property) is amended to read as follows:
            ``(3) Cellulosic biomass alcohol.--For purposes of this 
        subsection, the term `cellulosic biomass alcohol' means any 
        alcohol produced from any lignocellulosic or hemicellulosic 
        matter that is available on a renewable or recurring basis.''.
    (b) Conforming Amendments.--
            (1) Subsection (l) of section 168 of such Code is amended 
        by striking ``cellulosic biomass ethanol'' each place it 
        appears and inserting ``cellulosic biomass alcohol''.
            (2) The heading of section 168(l) of such Code is amended 
        by striking ``Cellulosic Biomass Ethanol'' and inserting 
        ``Cellulosic Biomass Alcohol''.
            (3) The heading of paragraph (2) of section 168(l) of such 
        Code is amended by striking ``cellulosic biomass ethanol'' and 
        inserting ``cellulosic biomass alcohol''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act, in taxable years ending after such date.

                 Subtitle B--Electricity and Renewables

SEC. 111. EXTENSION AND MODIFICATION OF ENERGY INVESTMENT TAX CREDIT.

    (a) Extension of Credit.--
            (1) Solar energy property.--Paragraphs (2)(A)(i)(II) and 
        (3)(A)(ii) of section 48(a) of the Internal Revenue Code of 
        1986 (relating to energy credit) are each amended by striking 
        ``January 1, 2009'' and inserting ``January 1, 2017''.
            (2) Fuel cell property.--Subparagraph (E) of section 
        48(c)(1) of such Code (relating to qualified fuel cell 
        property) is amended by striking ``December 31, 2008'' and 
        inserting ``December 31, 2016''.
    (b) Allowance of Energy Credit Against Alternative Minimum Tax.--
Subparagraph (B) of section 38(c)(4) of such Code (relating to 
specified credits) is amended by striking ``and'' at the end of clause 
(iii), by striking the period at the end of clause (iv) and inserting 
``, and'', and by adding at the end the following new clause:
    ``(v) the credit determined under section 46 to the extent that 
such credit is attributable to the energy credit determined under 
section 48.''.
    (c) Increase of Credit Limitation for Fuel Cell Property.--
Subparagraph (B) of section 48(c)(1) of such Code is amended by 
striking ``$500'' and inserting ``$1,500''.
    (d) Public Electric Utility Property Taken Into Account.--
            (1) In general.--Paragraph (3) of section 48(a) of such 
        Code is amended by striking the second sentence thereof.
            (2) Conforming amendments.--
                    (A) Paragraph (1) of section 48(c) of such Code is 
                amended by striking subparagraph (D) and redesignating 
                subparagraph (E) as subparagraph (D).
                    (B) Paragraph (2) of section 48(c) of such Code is 
                amended by striking subparagraph (D) and redesignating 
                subparagraph (E) as subparagraph (D).
    (e) Clerical Amendments.--Paragraphs (1)(B) and (2)(B) of section 
48(c) of such Code are each amended by striking ``paragraph (1)'' and 
inserting ``subsection (a)''.
    (f) Effective Date.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall take 
        effect on the date of the enactment of this Act.
            (2) Allowance against alternative minimum tax.--The 
        amendments made by subsection (b) shall apply to credits 
        determined under section 46 of the Internal Revenue Code of 
        1986 in taxable years beginning after the date of the enactment 
        of this Act and to carrybacks of such credits.
            (3) Increase in limitation for fuel cell property.--The 
        amendment made by subsection (c) shall apply to periods after 
        the date of the enactment of this Act, in taxable years ending 
        after such date, under rules similar to the rules of section 
        48(m) of the Internal Revenue Code of 1986 (as in effect on the 
        day before the date of the enactment of the Revenue 
        Reconciliation Act of 1990).
            (4) Public electric utility property.--The amendments made 
        by subsection (d) shall apply to periods after June 20, 2008, 
        in taxable years ending after such date, under rules similar to 
        the rules of section 48(m) of the Internal Revenue Code of 1986 
        (as in effect on the day before the date of the enactment of 
        the Revenue Reconciliation Act of 1990).

SEC. 112. CREDIT RATE PARITY FOR ALL RENEWABLE RESOURCES UNDER 
              ELECTRICITY PRODUCTION CREDIT.

    (a) In General.--Section 45(b)(4)(A) of the Internal Revenue Code 
of 1986 (relating to credit rate) is amended by inserting ``and before 
2008'' after ``2003''.
    (b) Effective Date.--The amendment made by this section shall apply 
to electricity produced and sold after December 31, 2007.

SEC. 113. EXTENSION OF CREDIT FOR PRODUCING ELECTRICITY FROM CERTAIN 
              RENEWABLE RESOURCES.

    Subsection (d) of section 45 of the Internal Revenue Code of 1986 
is amended by striking ``January 1, 2009'' each place it appears and 
inserting ``January 1, 2014''.

SEC. 114. EXPANSION OF CREDIT FOR ELECTRICITY PRODUCED FROM 
              AGRICULTURAL LIVESTOCK WASTE NUTRIENTS.

    (a) Increase in Credit Rate.--Subparagraph (A) of section 45(b)(4) 
of the Internal Revenue Code of 1986 (relating to credit rate) is 
amended by striking ``paragraph (3),'' and inserting ``paragraph (3) 
(other than subparagraph (A)(i) thereof),''.
    (b) Biogas and Thermal Energy Produced From Agricultural Livestock 
Waste Nutrients.--Section 45(e) of such Code (relating to definitions 
and special rules) is amended by adding at the end the following new 
paragraph:
            ``(12) Biogas and thermal energy produced from agricultural 
        livestock waste nutrients.--
                    ``(A) In general.--In the case of an open-loop 
                biomass facility, the term `kilowatt hour of 
                electricity' in paragraph (2) of subsection (a) shall 
                mean kilowatt hours of electricity and kilowatt-
                equivalent hours of biogas, synthesis gas, and thermal 
                energy produced from agricultural livestock waste 
                nutrients.
                    ``(B) Clarification.--Any requirements related to 
                electricity production under paragraph (3) of 
                subsection (d) shall not cause a facility producing 
                biogas, synthesis gas, or thermal energy from 
                agricultural livestock waste nutrients to fail to be 
                treated as a qualified facility under subsection 
                (d).''.
    (c) Credit Allowed for On-Site Use.--Section 45(e) of such Code 
(relating to definitions and special rules) is amended by adding at the 
end the following new paragraph:
            ``(13) Credit allowed for on-site use.--In the case of 
        electricity or biogas, synthesis gas, or thermal energy 
        produced at any facility described in paragraph (3) of 
        subsection (d) which is equipped with net metering to determine 
        electricity consumption or sale (such consumption or sale to be 
        verified by a third party as determined by the Secretary), 
        subsection (a)(2) shall be applied without regard to 
        subparagraph (B) thereof.''.
    (d) Effective Dates.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to taxable years 
        ending after December 31, 2006.
            (2) Subsection (c).--The amendment made by subsection (c) 
        shall apply to facilities placed in service after the date of 
        the enactment of this Act.

SEC. 115. CREDIT FOR INSTALLATION OF WIND ENERGY PROPERTY INCLUDING BY 
              RURAL HOMEOWNERS, FARMERS, RANCHERS, AND SMALL 
              BUSINESSES.

    (a) In General.--Subpart B of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new section:

``SEC. 30D. WIND ENERGY PROPERTY.

    ``(a) Allowance of Credit.--There shall be allowed as a credit 
against the tax imposed by this chapter for the taxable year an amount 
equal to $1,500 with respect to each half kilowatt of capacity of 
qualified wind energy property placed in service or installed by the 
taxpayer during such taxable year.
    ``(b) Limitation.--No credit shall be allowed under subsection (a) 
unless at least 50 percent of the energy produced annually by the 
qualified wind energy property is consumed on the site on which the 
property is placed in service or installed.
    ``(c) Qualified Wind Energy Property.--For purposes of this 
section, the term `qualified wind energy property' means a wind turbine 
of 100 kilowatts of rated capacity or less if--
            ``(1) such turbine is placed in service or installed on or 
        in connection with property located in the United States,
            ``(2) in the case of an individual, the property on or in 
        connection with which such turbine is installed is a dwelling 
        unit, and
            ``(3) the original use of such turbine commences with the 
        taxpayer.
    ``(d) Limitation Based on Amount of Tax.--
            ``(1) In general.--The credit allowed under subsection (a) 
        for any taxable year shall not exceed the excess of--
                    ``(A) the sum of the regular tax liability (as 
                defined in section 26(b)) plus the tax imposed by 
                section 55, over
                    ``(B) the sum of the credits allowable under this 
                part (other than under this section and subpart C 
                thereof, relating to refundable credits) and section 
                1397E.
            ``(2) Carryover of unused credit.--If the credit allowable 
        under subsection (a) exceeds the limitation imposed by 
        paragraph (1) for such taxable year, such excess shall be 
        carried to the succeeding taxable year and added to the credit 
        allowable under subsection (a) for such taxable year.
    ``(e) Special Rules.--For purposes of this section--
            ``(1) Tenant-stockholder in cooperative housing 
        corporation.--In the case of an individual who is a tenant-
        stockholder (as defined in section 216(b)(2)) in a cooperative 
        housing corporation (as defined in section 216(b)(1)), such 
        individual shall be treated as having paid his tenant-
        stockholder's proportionate share (as defined in section 
        216(b)(3)) of any expenditures paid or incurred for qualified 
        wind energy property by such corporation, and such credit shall 
        be allocated appropriately to such individual.
            ``(2) Condominiums.--
                    ``(A) In general.--In the case of an individual who 
                is a member of a condominium management association 
                with respect to a condominium which he owns, such 
                individual shall be treated as having paid his 
                proportionate share of expenditures paid or incurred 
                for qualified wind energy property by such association, 
                and such credit shall be allocated appropriately to 
                such individual.
                    ``(B) Condominium management association.--For 
                purposes of this paragraph, the term `condominium 
                management association' means an organization which 
                meets the requirements of section 528(c)(2) with 
                respect to a condominium project of which substantially 
                all of the units are used by individuals as dwelling 
                units.
    ``(f) Basis Adjustment.--For purposes of this subtitle, if a credit 
is allowed under this section for any expenditure with respect to a 
dwelling unit or other property, the increase in the basis of such 
dwelling unit or other property which would (but for this subsection) 
result from such expenditure shall be reduced by the amount of the 
credit so allowed.
    ``(g) Application of Credit.--The credit allowed under this section 
shall apply to property placed in service or installed after December 
31, 2007, and before January 1, 2012.''.
    (b) Conforming Amendment.--Subsection (a) of section 1016 of the 
Internal Revenue Code of 1986 (relating to general rule for adjustments 
to basis) is amended by striking ``and'' at the end of paragraph (36), 
by striking the period at the end of paragraph (37) and inserting ``, 
and'', and by adding at the end the following new paragraph:
            ``(38) in the case of a dwelling unit or other property 
        with respect to which a credit was allowed under section 30D, 
        to the extent provided in section 30D(f).''.
    (c) Clerical Amendment.--The table of sections for subpart B of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by inserting after the item relating to section 30C the 
following new item:

``Sec. 30D. Wind energy property.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after the date of the enactment of this 
Act.

SEC. 116. 3-YEAR ACCELERATED DEPRECIATION PERIOD FOR WIND ENERGY 
              PROPERTY.

    (a) In General.--Subparagraph (A) of section 168(e)(3) of the 
Internal Revenue Code of 1986 is amended by striking ``and'' at the end 
of clause (ii), by striking the period at the end of clause (iii) and 
inserting ``, and'', and by inserting after clause (iii) the following 
new clause:
                            ``(iv) any property which would be 
                        described in subparagraph (A) of section 
                        48(a)(3) if `wind energy' were substituted for 
                        `solar energy' in clause (i) thereof and the 
                        last sentence of such section did not apply to 
                        such subparagraph.''.
    (b) Conforming Amendment.--Section 168(e)(3)(B)(vi)(I) of such Code 
is amended to read as follows:
                                    ``(I) is described in subparagraph 
                                (A) of section 48(a)(3) if the last 
                                sentence of such section did not apply 
                                to such subparagraph,''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service in taxable years ending after the 
date of the enactment of this Act.

SEC. 117. REPEAL OF DOLLAR LIMITATION AND ALLOWANCE AGAINST ALTERNATIVE 
              MINIMUM TAX FOR RESIDENTIAL SOLAR AND FUEL CELL PROPERTY 
              CREDIT.

    (a) Repeal of Maximum Dollar Limitation.--
            (1) In general.--Subsection (b) of section 25D of the 
        Internal Revenue Code of 1986 (relating to limitations) is 
        amended to read as follows:
    ``(b) Certification of Solar Water Heating Property.--No credit 
shall be allowed under this section for an item of property described 
in subsection (d)(1) unless such property is certified for performance 
by the non-profit Solar Rating Certification Corporation or a 
comparable entity endorsed by the government of the State in which such 
property is installed.''.
            (2) Conforming amendments.--
                    (A) Subsection (e) of section 25D of such Code is 
                amended by striking paragraph (4) and by redesignating 
                paragraphs (5) through (9) as paragraphs (4) through 
                (8), respectively.
                    (B) Paragraph (1) of section 25C(e) of such Code is 
                amended by striking ``(8), and (9)'' and inserting 
                ``and (8) (and paragraph (4) as in effect before its 
                repeal by the American-Made Energy Act of 2008)''.
    (b) Credit Allowed Against Alternative Minimum Tax.--
            (1) In general.--Subsection (c) of section 25D of such Code 
        is amended to read as follows:
    ``(c) Limitation Based on Amount of Tax; Carryforward of Unused 
Credit.--
            ``(1) Limitation based on amount of tax.--In the case of a 
        taxable year to which section 26(a)(2) does not apply, the 
        credit allowed under subsection (a) for the taxable year shall 
        not exceed the excess of--
                    ``(A) the sum of the regular tax liability (as 
                defined in section 26(b)) plus the tax imposed by 
                section 55, over
                    ``(B) the sum of the credits allowable under this 
                subpart (other than this section) and section 27 for 
                the taxable year.
            ``(2) Carryforward of unused credit.--
                    ``(A) Rule for years in which all personal credits 
                allowed against regular and alternative minimum tax.--
                In the case of a taxable year to which section 26(a)(2) 
                applies, if the credit allowable under subsection (a) 
                exceeds the limitation imposed by section 26(a)(2) for 
                such taxable year reduced by the sum of the credits 
                allowable under this subpart (other than this section), 
                such excess shall be carried to the succeeding taxable 
                year and added to the credit allowable under subsection 
                (a) for such succeeding taxable year.
                    ``(B) Rule for other years.--In the case of a 
                taxable year to which section 26(a)(2) does not apply, 
                if the credit allowable under subsection (a) exceeds 
                the limitation imposed by paragraph (1) for such 
                taxable year, such excess shall be carried to the 
                succeeding taxable year and added to the credit 
                allowable under subsection (a) for such succeeding 
                taxable year.''.
            (2) Conforming amendments.--
                    (A) Section 23(b)(4)(B) of such Code is amended by 
                inserting ``and section 25D'' after ``this section''.
                    (B) Section 24(b)(3)(B) of such Code is amended by 
                striking ``and 25B'' and inserting ``, 25B, and 25D''.
                    (C) Section 25B(g)(2) of such Code is amended by 
                striking ``section 23'' and inserting ``sections 23 and 
                25D''.
                    (D) Section 26(a)(1) of such Code is amended by 
                striking ``and 25B'' and inserting ``25B, and 25D''.
    (c) Effective Dates.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        expenditures made after the date of the enactment of this Act.
            (2) Allowance against alternative minimum tax.--
                    (A) In general.--The amendments made by subsection 
                (b) shall apply to taxable years beginning after the 
                date of the enactment of this Act.
                    (B) Application of egtrra sunset.--The amendments 
                made by subparagraphs (A) and (B) of subsection (b)(2) 
                shall be subject to title IX of the Economic Growth and 
                Tax Relief Reconciliation Act of 2001 in the same 
                manner as the provisions of such Act to which such 
                amendments relate.

SEC. 118. NEW CLEAN RENEWABLE ENERGY BONDS.

    (a) In General.--Part IV of subchapter A of chapter 1 of the 
Internal Revenue Code of 1986 (relating to credits against tax) is 
amended by adding at the end the following new subpart:

                ``Subpart I--Qualified Tax Credit Bonds

``Sec. 54A. Credit to holders of qualified tax credit bonds.
``Sec. 54B. New clean renewable energy bonds.

``SEC. 54A. CREDIT TO HOLDERS OF QUALIFIED TAX CREDIT BONDS.

    ``(a) Allowance of Credit.--If a taxpayer holds a qualified tax 
credit bond on one or more credit allowance dates of the bond during 
any taxable year, there shall be allowed as a credit against the tax 
imposed by this chapter for the taxable year an amount equal to the sum 
of the credits determined under subsection (b) with respect to such 
dates.
    ``(b) Amount of Credit.--
            ``(1) In general.--The amount of the credit determined 
        under this subsection with respect to any credit allowance date 
        for a qualified tax credit bond is 25 percent of the annual 
        credit determined with respect to such bond.
            ``(2) Annual credit.--The annual credit determined with 
        respect to any qualified tax credit bond is the product of--
                    ``(A) the applicable credit rate, multiplied by
                    ``(B) the outstanding face amount of the bond.
            ``(3) Applicable credit rate.--For purposes of paragraph 
        (2), the applicable credit rate is the rate which the Secretary 
        estimates will permit the issuance of qualified tax credit 
        bonds with a specified maturity or redemption date without 
        discount and without interest cost to the qualified issuer. The 
        applicable credit rate with respect to any qualified tax credit 
        bond shall be determined as of the first day on which there is 
        a binding, written contract for the sale or exchange of the 
        bond.
            ``(4) Special rule for issuance and redemption.--In the 
        case of a bond which is issued during the 3-month period ending 
        on a credit allowance date, the amount of the credit determined 
        under this subsection with respect to such credit allowance 
        date shall be a ratable portion of the credit otherwise 
        determined based on the portion of the 3-month period during 
        which the bond is outstanding. A similar rule shall apply when 
        the bond is redeemed or matures.
    ``(c) Limitation Based on Amount of Tax.--
            ``(1) In general.--The credit allowed under subsection (a) 
        for any taxable year shall not exceed the excess of--
                    ``(A) the sum of the regular tax liability (as 
                defined in section 26(b)) plus the tax imposed by 
                section 55, over
                    ``(B) the sum of the credits allowable under this 
                part (other than subpart C and this subpart).
            ``(2) Carryover of unused credit.--If the credit allowable 
        under subsection (a) exceeds the limitation imposed by 
        paragraph (1) for such taxable year, such excess shall be 
        carried to the succeeding taxable year and added to the credit 
        allowable under subsection (a) for such taxable year 
        (determined before the application of paragraph (1) for such 
        succeeding taxable year).
    ``(d) Qualified Tax Credit Bond.--For purposes of this section--
            ``(1) Qualified tax credit bond.--The term `qualified tax 
        credit bond' means a new clean renewable energy bond which is 
        part of an issue that meets the requirements of paragraphs (2), 
        (3), (4), (5), and (6).
            ``(2) Special rules relating to expenditures.--
                    ``(A) In general.--An issue shall be treated as 
                meeting the requirements of this paragraph if, as of 
                the date of issuance, the issuer reasonably expects--
                            ``(i) 100 percent or more of the available 
                        project proceeds to be spent for 1 or more 
                        qualified purposes within the 3-year period 
                        beginning on such date of issuance, and
                            ``(ii) a binding commitment with a third 
                        party to spend at least 10 percent of such 
                        available project proceeds will be incurred 
                        within the 6-month period beginning on such 
                        date of issuance.
                    ``(B) Failure to spend required amount of bond 
                proceeds within 3 years.--
                            ``(i) In general.--To the extent that less 
                        than 100 percent of the available project 
                        proceeds of the issue are expended by the close 
                        of the expenditure period for 1 or more 
                        qualified purposes, the issuer shall redeem all 
                        of the nonqualified bonds within 90 days after 
                        the end of such period. For purposes of this 
                        paragraph, the amount of the nonqualified bonds 
                        required to be redeemed shall be determined in 
                        the same manner as under section 142.
                            ``(ii) Expenditure period.--For purposes of 
                        this subpart, the term `expenditure period' 
                        means, with respect to any issue, the 3-year 
                        period beginning on the date of issuance. Such 
                        term shall include any extension of such period 
                        under clause (iii).
                            ``(iii) Extension of period.--Upon 
                        submission of a request prior to the expiration 
                        of the expenditure period (determined without 
                        regard to any extension under this clause), the 
                        Secretary may extend such period if the issuer 
                        establishes that the failure to expend the 
                        proceeds within the original expenditure period 
                        is due to reasonable cause and the expenditures 
                        for qualified purposes will continue to proceed 
                        with due diligence.
                    ``(C) Qualified purpose.--For purposes of this 
                paragraph, the term `qualified purpose' means a purpose 
                specified in section 54B(a)(1).
                    ``(D) Reimbursement.--For purposes of this 
                subtitle, available project proceeds of an issue shall 
                be treated as spent for a qualified purpose if such 
                proceeds are used to reimburse the issuer for amounts 
                paid for a qualified purpose after the date that the 
                Secretary makes an allocation of bond limitation with 
                respect to such issue, but only if--
                            ``(i) prior to the payment of the original 
                        expenditure, the issuer declared its intent to 
                        reimburse such expenditure with the proceeds of 
                        a qualified tax credit bond,
                            ``(ii) not later than 60 days after payment 
                        of the original expenditure, the issuer adopts 
                        an official intent to reimburse the original 
                        expenditure with such proceeds, and
                            ``(iii) the reimbursement is made not later 
                        than 18 months after the date the original 
                        expenditure is paid.
            ``(3) Reporting.--An issue shall be treated as meeting the 
        requirements of this paragraph if the issuer of qualified tax 
        credit bonds submits reports similar to the reports required 
        under section 149(e).
            ``(4) Special rules relating to arbitrage.--
                    ``(A) In general.--An issue shall be treated as 
                meeting the requirements of this paragraph if the 
                issuer satisfies the requirements of section 148 with 
                respect to the proceeds of the issue.
                    ``(B) Special rule for investments during 
                expenditure period.--An issue shall not be treated as 
                failing to meet the requirements of subparagraph (A) by 
                reason of any investment of available project proceeds 
                during the expenditure period.
                    ``(C) Special rule for reserve funds.--An issue 
                shall not be treated as failing to meet the 
                requirements of subparagraph (A) by reason of any fund 
                which is expected to be used to repay such issue if--
                            ``(i) such fund is funded at a rate not 
                        more rapid than equal annual installments,
                            ``(ii) such fund is funded in a manner that 
                        such fund will not exceed the amount necessary 
                        to repay the issue if invested at the maximum 
                        rate permitted under clause (iii), and
                            ``(iii) the yield on such fund is not 
                        greater than the discount rate determined under 
                        paragraph (5)(B) with respect to the issue.
            ``(5) Maturity limitation.--
                    ``(A) In general.--An issue shall not be treated as 
                meeting the requirements of this paragraph if the 
                maturity of any bond which is part of such issue 
                exceeds the maximum term determined by the Secretary 
                under subparagraph (B).
                    ``(B) Maximum term.--During each calendar month, 
                the Secretary shall determine the maximum term 
                permitted under this paragraph for bonds issued during 
                the following calendar month. Such maximum term shall 
                be the term which the Secretary estimates will result 
                in the present value of the obligation to repay the 
                principal on the bond being equal to 50 percent of the 
                face amount of such bond. Such present value shall be 
                determined using as a discount rate the average annual 
                interest rate of tax-exempt obligations having a term 
                of 10 years or more which are issued during the month. 
                If the term as so determined is not a multiple of a 
                whole year, such term shall be rounded to the next 
                highest whole year.
            ``(6) Prohibition on financial conflicts of interest.--An 
        issue shall be treated as meeting the requirements of this 
        paragraph if the issuer certifies that--
                    ``(A) applicable State and local law requirements 
                governing conflicts of interest are satisfied with 
                respect to such issue, and
                    ``(B) if the Secretary prescribes additional 
                conflicts of interest rules governing the appropriate 
                Members of Congress, Federal, State, and local 
                officials, and their spouses, such additional rules are 
                satisfied with respect to such issue.
    ``(e) Other Definitions.--For purposes of this subchapter--
            ``(1) Credit allowance date.--The term `credit allowance 
        date' means--
                    ``(A) March 15,
                    ``(B) June 15,
                    ``(C) September 15, and
                    ``(D) December 15.
        Such term includes the last day on which the bond is 
        outstanding.
            ``(2) Bond.--The term `bond' includes any obligation.
            ``(3) State.--The term `State' includes the District of 
        Columbia and any possession of the United States.
            ``(4) Available project proceeds.--The term `available 
        project proceeds' means--
                    ``(A) the excess of--
                            ``(i) the proceeds from the sale of an 
                        issue, over
                            ``(ii) the issuance costs financed by the 
                        issue (to the extent that such costs do not 
                        exceed 2 percent of such proceeds), and
                    ``(B) the proceeds from any investment of the 
                excess described in subparagraph (A).
    ``(f) Credit Treated as Interest.--For purposes of this subtitle, 
the credit determined under subsection (a) shall be treated as interest 
which is includible in gross income.
    ``(g) S Corporations and Partnerships.--In the case of a tax credit 
bond held by an S corporation or partnership, the allocation of the 
credit allowed by this section to the shareholders of such corporation 
or partners of such partnership shall be treated as a distribution.
    ``(h) Bonds Held by Regulated Investment Companies and Real Estate 
Investment Trusts.--If any qualified tax credit bond is held by a 
regulated investment company or a real estate investment trust, the 
credit determined under subsection (a) shall be allowed to shareholders 
of such company or beneficiaries of such trust (and any gross income 
included under subsection (f) with respect to such credit shall be 
treated as distributed to such shareholders or beneficiaries) under 
procedures prescribed by the Secretary.
    ``(i) Credits May Be Stripped.--Under regulations prescribed by the 
Secretary--
            ``(1) In general.--There may be a separation (including at 
        issuance) of the ownership of a qualified tax credit bond and 
        the entitlement to the credit under this section with respect 
        to such bond. In case of any such separation, the credit under 
        this section shall be allowed to the person who on the credit 
        allowance date holds the instrument evidencing the entitlement 
        to the credit and not to the holder of the bond.
            ``(2) Certain rules to apply.--In the case of a separation 
        described in paragraph (1), the rules of section 1286 shall 
        apply to the qualified tax credit bond as if it were a stripped 
        bond and to the credit under this section as if it were a 
        stripped coupon.

``SEC. 54B. NEW CLEAN RENEWABLE ENERGY BONDS.

    ``(a) New Clean Renewable Energy Bond.--For purposes of this 
subpart, the term `new clean renewable energy bond' means any bond 
issued as part of an issue if--
            ``(1) 100 percent of the available project proceeds of such 
        issue are to be used for capital expenditures incurred by 
        public power providers or cooperative electric companies for 
        one or more qualified renewable energy facilities,
            ``(2) the bond is issued by a qualified issuer, and
            ``(3) the issuer designates such bond for purposes of this 
        section.
    ``(b) Reduced Credit Amount.--The annual credit determined under 
section 54A(b) with respect to any new clean renewable energy bond 
shall be 70 percent of the amount so determined without regard to this 
subsection.
    ``(c) Limitation on Amount of Bonds Designated.--
            ``(1) In general.--The maximum aggregate face amount of 
        bonds which may be designated under subsection (a) by any 
        issuer shall not exceed the limitation amount allocated under 
        this subsection to such issuer.
            ``(2) National limitation on amount of bonds designated.--
        There is a national new clean renewable energy bond limitation 
        of $2,000,000,000 which shall be allocated by the Secretary as 
        provided in paragraph (3), except that--
                    ``(A) not more than 60 percent thereof may be 
                allocated to qualified projects of public power 
                providers, and
                    ``(B) not more than 40 percent thereof may be 
                allocated to qualified projects of cooperative electric 
                companies.
            ``(3) Method of allocation.--
                    ``(A) Allocation among public power providers.--
                After the Secretary determines the qualified projects 
                of public power providers which are appropriate for 
                receiving an allocation of the national new clean 
                renewable energy bond limitation, the Secretary shall, 
                to the maximum extent practicable, make allocations 
                among such projects in such manner that the amount 
                allocated to each such project bears the same ratio to 
                the cost of such project as the limitation under 
                subparagraph (2)(A) bears to the cost of all such 
                projects.
                    ``(B) Allocation among cooperative electric 
                companies.--The Secretary shall make allocations of the 
                amount of the national new clean renewable energy bond 
                limitation described in paragraph (2)(B) among 
                qualified projects of cooperative electric companies in 
                such manner as the Secretary determines appropriate.
    ``(d) Definitions.--For purposes of this section--
            ``(1) Qualified renewable energy facility.--The term 
        `qualified renewable energy facility' means a qualified 
        facility (as determined under section 45(d) without regard to 
        paragraphs (8) and (10) thereof and to any placed in service 
        date) owned by a public power provider or a cooperative 
        electric company.
            ``(2) Public power provider.--The term `public power 
        provider' means a State utility with a service obligation, as 
        such terms are defined in section 217 of the Federal Power Act 
        (as in effect on the date of the enactment of this paragraph).
            ``(3) Cooperative electric company.--The term `cooperative 
        electric company' means a mutual or cooperative electric 
        company described in section 501(c)(12) or section 
        1381(a)(2)(C).
            ``(4) Clean renewable energy bond lender.--The term `clean 
        renewable energy bond lender' means a lender which is a 
        cooperative which is owned by, or has outstanding loans to, 100 
        or more cooperative electric companies and is in existence on 
        February 1, 2002, and shall include any affiliated entity which 
        is controlled by such lender.
            ``(5) Qualified issuer.--The term `qualified issuer' means 
        a public power provider, a cooperative electric company, a 
        clean renewable energy bond lender, or a not-for-profit 
        electric utility which has received a loan or loan guarantee 
        under the Rural Electrification Act.''.
    (b) Reporting.--Subsection (d) of section 6049 of such Code 
(relating to returns regarding payments of interest) is amended by 
adding at the end the following new paragraph:
            ``(9) Reporting of credit on qualified tax credit bonds.--
                    ``(A) In general.--For purposes of subsection (a), 
                the term `interest' includes amounts includible in 
                gross income under section 54A and such amounts shall 
                be treated as paid on the credit allowance date (as 
                defined in section 54A(e)(1)).
                    ``(B) Reporting to corporations, etc.--Except as 
                otherwise provided in regulations, in the case of any 
                interest described in subparagraph (A) of this 
                paragraph, subsection (b)(4) of this section shall be 
                applied without regard to subparagraphs (A), (H), (I), 
                (J), (K), and (L)(i).
                    ``(C) Regulatory authority.--The Secretary may 
                prescribe such regulations as are necessary or 
                appropriate to carry out the purposes of this 
                paragraph, including regulations which require more 
                frequent or more detailed reporting.''.
    (c) Conforming Amendments.--
            (1) Sections 54(c)(2) and 1400N(l)(3)(B) of such Code are 
        each amended by striking ``subpart C'' and inserting ``subparts 
        C and I''.
            (2) Section 1397E(c)(2) of such Code is amended by striking 
        ``subpart H'' and inserting ``subparts H and I''.
            (3) Section 6401(b)(1) of such Code is amended by striking 
        ``and H'' and inserting ``H, and I''.
            (4) The heading of subpart H of part IV of subchapter A of 
        chapter 1 of such Code is amended by striking ``Certain Bonds'' 
        and inserting ``Clean Renewable Energy Bonds''.
            (5) The table of subparts for part IV of subchapter A of 
        chapter 1 of such Code is amended by striking the item relating 
        to subpart H and inserting the following new items:

``subpart h. nonrefundable credit to holders of clean renewable energy 
                                 bonds.

              ``subpart i. qualified tax credit bonds.''.

    (d) Effective Dates.--The amendments made by this section shall 
apply to obligations issued after the date of the enactment of this 
Act.

SEC. 119. EXTENSION AND MODIFICATION OF CREDIT FOR RESIDENTIAL ENERGY 
              EFFICIENT PROPERTY.

    (a) Extension.--Subsection (g) of section 25D of the Internal 
Revenue Code of 1986 (relating to termination) is amended by striking 
``2008'' and inserting ``2016''.
    (b) Solar Electric Property.--Paragraph (1) of section 25D(a) of 
such Code (relating to allowance of credit) is amended by striking ``30 
percent of''.
    (c) Modification of Maximum Credit.--Paragraph (1) of section 
25D(b) of the Internal Revenue Code of 1986 (relating to limitations) 
is amended to read as follows:
            ``(1) Maximum credit.--The credit allowed under subsection 
        (a) for any taxable year shall not exceed--
                    ``(A) $1,500 with respect to each half kilowatt of 
                installed capacity of qualified solar electric property 
                for which qualified solar electric property 
                expenditures are made,
                    ``(B) $2,000 with respect to any qualified solar 
                water heating property expenditures, and
                    ``(C) $500 with respect to each half kilowatt of 
                capacity of qualified fuel cell property (as defined in 
                section 48(c)(1)) for which qualified fuel cell 
                property expenditures are made.''.
    (d) Definition of Qualified Solar Water Heating Property 
Expenditure.--Paragraph (1) of section 25D(d) of such Code is amended 
by striking ``to heat water for use in'' and inserting ``to heat or 
cool (or provide hot water for use in)''.
    (e) Definition of Qualified Photovoltaic Property Expenditure.--
Paragraph (2) of section 25D(d) of such Code is amended by inserting 
``, including advanced energy storage systems installed as an 
integrated component of the foregoing'' after ``taxpayer''.
    (f) Credit Allowed Against Alternative Minimum Tax.--
            (1) In general.--Section 25D(b) of the Internal Revenue 
        Code of 1986 (as amended by subsection (b)) is amended by 
        adding at the end the following new paragraph:
            ``(3) Credit allowed against alternative minimum tax.--The 
        credit allowed under subsection (a) for the taxable year shall 
        not exceed the excess of--
                    ``(A) the sum of the regular tax liability (as 
                defined in section 26(b)) plus the tax imposed by 
                section 55, over
                    ``(B) the sum of the credits allowable under 
                subpart A of part IV of subchapter A (other than this 
                section) and section 27 for the taxable year.''.
            (2) Conforming amendments.--
                    (A) Subsection (c) of section 25D of such Code is 
                amended to read as follows:
    ``(c) Carryforward of Unused Credit.--If the credit allowable under 
subsection (a) for any taxable year exceeds the limitation imposed by 
subsection (b)(3) for such taxable year, such excess shall be carried 
to the succeeding taxable year and added to the credit allowable under 
subsection (a) for such succeeding taxable year.''.
                    (B) Section 23(b)(4)(B) of such Code is amended by 
                inserting ``and section 25D'' after ``this section''.
                    (C) Section 24(b)(3)(B) of such Code is amended by 
                striking ``sections 23 and 25B'' and inserting 
                ``sections 23, 25B, and 25D''.
                    (D) Section 26(a)(1) of such Code is amended by 
                striking ``and 25B'' and inserting ``25B, and 25D''.
    (g) Effective Date.--The amendments made by this section shall 
apply to expenditures made in taxable years beginning after December 
31, 2006.

                    Subtitle C--Coal-to-Liquid Fuel

SEC. 121. EXTENSION OF ALTERNATIVE FUEL CREDIT FOR FUEL DERIVED FROM 
              COAL.

    (a) Alternative Fuel Credit.--Paragraph (4) of section 6426(d) of 
the Internal Revenue Code of 1986 is amended to read as follows:
            ``(4) Termination.--This subsection shall not apply to--
                    ``(A) any sale or use involving liquid fuel derived 
                from a feedstock that is primarily domestic coal 
                (including peat) for any period after September 30, 
                2020,
                    ``(B) any sale or use involving liquified hydrogen 
                for any period after September 30, 2014, and
                    ``(C) any other sale or use for any period after 
                September 30, 2009.''.
    (b) Payments.--
            (1) In general.--Paragraph (5) of section 6427(e) of the 
        Internal Revenue Code of 1986 is amended by striking ``and'' 
        and the end of subparagraph (C), by striking the period at the 
        end of subparagraph (D) and inserting ``, and'', and by adding 
        at the end the following new subparagraph:
                    ``(E) any alternative fuel or alternative fuel 
                mixture (as so defined) involving transportation grade 
                liquid fuel derived from coal (including peat) sold or 
                used after September 30, 2020.''.
            (2) Conforming amendment.--Section 6427(e)(5)(C) of such 
        Code is amended by striking ``subparagraph (D)'' and inserting 
        ``subparagraphs (D) and (E)''.
    (c) Conforming Amendment.--Section 6426(d)(2)(E) of such Code is 
amended by inserting ``transportation grade'' before ``liquid fuel'' 
and by striking ``through the Fischer-Tropsch process''.
    (d) Effective Date.--The amendments made by this section shall 
apply to any sale or use for any period after the date of enactment of 
this Act.

                     Subtitle D--Energy Efficiency

SEC. 131. EXTENSION OF NEW ENERGY EFFICIENT HOME CREDIT.

    (a) In General.--Section 45L(g) of the Internal Revenue Code of 
1986 is amended by striking ``December 31, 2008'' and inserting 
``December 31, 2013''.
    (b) Effective Date.--The amendment made by this section shall apply 
to qualified new energy efficient homes acquired after the date of 
enactment of this Act, in taxable years ending after such date.

SEC. 132. MODIFICATION AND EXTENSION OF ENERGY EFFICIENT COMMERCIAL 
              BUILDINGS DEDUCTION.

    (a) Increase in Credit Amount.--
            (1) In general.--Subparagraph (A) of section 179D(b)(1) of 
        the Internal Revenue Code of 1986 is amended by striking 
        ``$1.80'' and inserting ``$2.25''.
            (2) Partial allowance.--Subparagraph (A) of section 
        179D(d)(1) of such Code is amended--
                    (A) by striking ``$.60'' and inserting ``$.75'', 
                and
                    (B) by striking ``$1.80'' and inserting ``$2.25''.
    (b) Extension.--Section 179D(h) of such Code is amended by striking 
``December 31, 2007'' and inserting ``December 31, 2013''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after December 31, 2006.

                 Subtitle E--Alternative Vehicle Fuels

SEC. 141. CONSUMER CREDIT FOR PURCHASE OF FLEXIBLE FUEL MOTOR VEHICLE.

    (a) In General.--Section 30B of the Internal Revenue Code of 1986 
(relating to alternative motor vehicle credit) is amended--
            (1) in subsection (a) by striking ``and'' at the end of 
        paragraph (3), by striking the period and inserting ``, and'' 
        at the end of paragraph (4), and by adding at the end the 
        following new paragraph:
            ``(5) the qualified flexible fuel motor vehicle credit 
        determined under subsection (f).'', and
            (2) by redesignating subsections (f), (g), (h), (i), and 
        (j) as subsections (g), (h), (i), (j), and (k), respectively, 
        and by inserting after subsection (e) the following new 
        subsection:
    ``(f) Qualified Flexible Fuel Motor Vehicle Credit.--
            ``(1) Allowance of credit.--For purposes of subsection (a), 
        the qualified flexible fuel motor vehicle credit determined 
        under this subsection for the taxable year is an amount equal 
        to the sum of--
                    ``(A) $100 for each qualified flexible fuel motor 
                vehicle placed in service by the taxpayer during the 
                taxable year that is not a new qualified hybrid motor 
                vehicle (as described in subsection (d)(3)), plus
                    ``(B) $200 for each qualified flexible fuel motor 
                vehicle placed in service by the taxpayer during the 
                taxable year that is a new qualified hybrid motor 
                vehicle (as described in subsection (d)(3)).
            ``(2) Qualified flexible fuel motor vehicle.--For purposes 
        of this subsection--
                    ``(A) In general.--The term `qualified flexible 
                fuel motor vehicle' means a vehicle capable of 
                operating on gasoline and on any mixture containing 
                gasoline and up to 85 percent ethanol.
                    ``(B) Other requirements.--A vehicle meets the 
                requirements of this paragraph if--
                            ``(i) the original use of the vehicle 
                        commences with the taxpayer,
                            ``(ii) the vehicle is acquired for use or 
                        lease by the taxpayer and not for resale, and
                            ``(iii) the vehicle is made by a 
                        manufacturer in the United States.''.
    (b) Termination.--Subsection (k) of section 30B of such Code (as 
redesignated by subsection (a)) is amended by striking ``and'' at the 
end of paragraph (3), by striking the period and inserting ``, and'' at 
the end of paragraph (4), and by adding at the end the following new 
paragraph:
            ``(5) in the case of a qualified flexible fuel motor 
        vehicle (as described in subsection (f)(2)), December 31, 
        2012.''.
    (c) Conforming Amendments.--
            (1) Paragraph (4) of section 30B(i) of such Code (as 
        redesignated by subsection (a)) is amended by striking 
        ``subsection (g)'' and inserting ``subsection (h)''.
            (2) Paragraph (6) of section 30B(i) of such Code (as 
        redesignated by subsection (a)) is amended by striking 
        ``subsection (g)'' each place it appears and inserting 
        ``subsection (h)''.
            (3) Paragraph (25) of section 38(b) of such Code is amended 
        by striking ``section 30B(g)(1)'' and inserting ``section 
        30B(h)(1)''.
            (4) Paragraph (3) of section 55(c) of such Code is amended 
        by striking ``30B(g)(2)'' and inserting ``30B(h)(2)''.
            (5) Paragraph (36) of section 1016(a) of such Code is 
        amended by striking ``section 30B(h)(4)'' and inserting 
        ``section 30B(i)(4)''.
            (6) Subsection (m) of section 6501 of such Code is amended 
        by striking ``30B(h)(9)'' and inserting ``30B(i)(9)''.
    (d) Effective Date.--The amendments made by this section shall 
apply to purchases made after the date of the enactment of this Act, in 
taxable years ending after such date.

SEC. 142. REPEAL OF PROHIBITION ON PROCUREMENT AND ACQUISITION OF 
              ALTERNATIVE FUELS.

    Section 526 of the Energy Independence and Security Act of 2007 is 
hereby repealed.

                     Subtitle F--Biofuel Production

SEC. 151. EXTENSION AND MODIFICATION OF CREDITS FOR BIODIESEL AND 
              RENEWABLE DIESEL.

    (a) In General.--Sections 40A(g), 6426(c)(6), and 6427(e)(5)(B) of 
the Internal Revenue Code of 1986 are each amended by striking 
``December 31, 2008'' and inserting ``December 31, 2010''.
    (b) Uniform Treatment of Diesel Produced From Biomass.--Paragraph 
(3) of section 40A(f) of such Code is amended by striking ``using a 
thermal depolymerization process''.
    (c) Eligibility of Certain Aviation Fuel.--Section 40A(f)(3) of 
such Code (defining renewable diesel) is amended by adding at the end 
the following new flush sentence: ``The term `renewable diesel' also 
means fuel derived from biomass (as defined in section 45K(c)(3)) using 
a thermal depolymerization process which meets the requirements of a 
Department of Defense specification for military jet fuel or an 
American Society of Testing and Materials specification for aviation 
turbine fuel.''.
    (d) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to fuel produced, 
        and sold or used, after the date of the enactment of this Act.
            (2) Uniform treatment of diesel produced from biomass.--The 
        amendments made by subsection (b) shall apply to fuel produced, 
        and sold or used, after the date which is 30 days after the 
        date of the enactment of this Act.

                   Subtitle G--Oil and Gas Provisions

SEC. 161. EXPENSING FOR CRUDE OIL REFINERIES.

    (a) In General.--Subsection (c) of section 179C of the Internal 
Revenue Code of 1986 (relating to election to expense certain 
refineries) is amended by adding at the end the following new 
paragraph:
            ``(4) Extension to certain facilities.--The term `qualified 
        refinery property' shall also mean any refinery or portion of a 
        refinery--
                    ``(A) the original use of which commences with the 
                taxpayer,
                    ``(B) the construction of which--
                            ``(i) except as provided in clause (ii), is 
                        subject to a binding construction contract 
                        entered into after December 31, 2008, and 
                        before January 1, 2015, but only if there was 
                        no written binding construction contract 
                        entered into before January 1, 2009, or
                            ``(ii) in the case of self-constructed 
                        property, began after December 31, 2008, and
                    ``(C) which is placed in service by the taxpayer 
                after the date of the enactment of this paragraph and 
                before January 1, 2020.''.

SEC. 162. EXTENSION OF SUSPENSION OF TAXABLE INCOME LIMIT ON PERCENTAGE 
              DEPLETION FOR OIL AND NATURAL GAS PRODUCED FROM MARGINAL 
              PROPERTIES.

    (a) In General.--Subparagraph (H) of section 613A(c)(6) is amended 
by striking ``January 1, 2008'' and inserting ``January 1, 2012''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to taxable years beginning after December 31, 2007.

SEC. 163. INCREASE IN DEPLETION RATE FOR MARGINAL OIL OR GAS 
              PRODUCTION.

    (a) Base Rate.--Clause (i) of section 613A(c)(6)(C) of the Internal 
Revenue Code of 1986 is amended by striking ``15 percent'' and 
inserting ``20 percent''.
    (b) Maximum Rate.--Section 613A(c)(6)(C) of such Code is amended by 
striking ``25 percent'' and inserting ``30 percent''.
    (c) Reference Price.--Section 613A(c)(6)(C)(ii) of such Code is 
amended by striking ``$20'' and inserting ``$40''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2007.

SEC. 164. SUSPENSION OF TAXABLE INCOME LIMITATION ON PERCENTAGE 
              DEPLETION.

    (a) In General.--The first sentence of paragraph (1) of section 
613A(d) of the Internal Revenue Code of 1986 (relating to limitation 
based on taxable income) is amended by striking ``The deduction'' and 
inserting ``In the case of taxable years beginning before January 1, 
2008, or after December 31, 2011, the deduction''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to taxable years beginning after December 31, 2007.

SEC. 165. STUDY ON FAIR AND TRANSPARENT FUEL PRICING.

    (a) Study.--The Federal Trade Commission shall conduct a study to 
determine--
            (1) the effects on competitive gasoline pricing of State 
        guaranteed profit laws, also known as ``minimum mark-up'' or 
        ``below cost sales'' statutes; and
            (2) the effect of credit card processing fees on gasoline 
        costs to consumers.
    (b) Report.--Not later than 1 year after the date of enactment of 
this Act, the Federal Trade Commission shall transmit to Congress a 
report on the findings of the study conducted pursuant to subsection 
(a) and shall publish such report on the Commission's Internet website.

              Subtitle H--Carbon Capture and Sequestration

SEC. 171. EXPANSION AND MODIFICATION OF ADVANCED COAL PROJECT 
              INVESTMENT CREDIT.

    (a) Modification of Credit Amount.--Section 48A(a) (relating to 
qualifying advanced coal project credit) is amended by striking ``and'' 
at the end of paragraph (1), by striking the period at the end of 
paragraph (2) and inserting ``, and'', and by adding at the end the 
following the paragraph:
            ``(3) 30 percent of the qualified investment for such 
        taxable year in the case of projects described in clauses (iii) 
        or (iv) of subsection (d)(3)(B).''.
    (b) Expansion of Aggregate Credits.--Section 48A(d)(3)(A) (relating 
to aggregate credits) is amended by striking ``$1,300,000,000'' and 
inserting ``$1,500,000,000''.
    (c) Authorization of Additional Projects.--
            (1) In general.--Subparagraph (B) of section 48A(d)(3) 
        (relating to aggregate credits) is amended to read as follows:
                    ``(B) Particular projects.--Of the dollar amount in 
                subparagraph (A), the Secretary is authorized to 
                certify--
                            ``(i) $500,000,000 for advanced coal 
                        electricity projects the application for which 
                        is submitted during the period described in 
                        paragraph (2)(A)(i),
                            ``(ii) $500,000,000 for coal gasification 
                        projects the application for which is submitted 
                        during the period described in paragraph 
                        (2)(A)(i), and
                            ``(iii) $500,000,000 for coal to liquid 
                        facilities which can demonstrate that the 
                        facility would capture and sequester at least 
                        65 percent of the facility's carbon dioxide 
                        emissions, the application for which is 
                        submitted during the period described in 
                        paragraph (2)(A)(ii).''.
            (2) Application period for additional projects.--
        Subparagraph (A) of section 48A(d)(2) (relating to 
        certification) is amended to read as follows:
                    ``(A) Application period.--Each applicant for 
                certification under this paragraph shall submit an 
                application meeting the requirements of subparagraph 
                (B). An applicant may only submit an application--
                            ``(i) for an allocation from the dollar 
                        amount specified in clause (i) or (ii) of 
                        paragraph (3)(A) during the 3-year period 
                        beginning on the date the Secretary establishes 
                        the program under paragraph (1), and
                            ``(ii) for an allocation from the dollar 
                        amount specified in clause (iii) or (iv) of 
                        paragraph (3)(A) during the 3-year period 
                        beginning at the earlier of the termination of 
                        the period described in clause (i) or the date 
                        prescribed by the Secretary.''.
            (3) Capture and sequestration of carbon dioxide emissions 
        requirement.--
                    (A) In general.--Section 48A(e)(1) (relating to 
                requirements) is amended by striking ``and'' at the end 
                of subparagraph (E), by striking the period at the end 
                of subparagraph (F) and inserting ``; and'', and by 
                adding at the end the following new subparagraph:
                    ``(G) in the case of any project the application 
                for which is submitted during the period described in 
                subsection (d)(2)(A)(ii), the project includes 
                equipment which separates and sequesters at least 65 
                percent (70 percent in the case of an application for 
                reallocated credits under subsection (d)(4)) of such 
                project's total carbon dioxide emissions.''.
                    (B) Highest priority for projects which sequester 
                carbon dioxide emissions.--Section 48A(e)(3) is amended 
                by striking ``and'' at the end of subparagraph 
                (A)(iii), by striking the period at the end of 
                subparagraph (B)(3) and inserting ``, and'', and by 
                adding at the end the following new subparagraph:
                    ``(C) give highest priority to projects with the 
                greatest separation and sequestration percentage of 
                total carbon dioxide emissions.''.
                    (C) Recapture of credit for failure to sequester.--
                Section 48A (relating to qualifying advanced coal 
                project credit) is amended by adding at the end the 
                following new subsection:
    ``(h) Recapture of Credit for Failure to Sequester.--The Secretary 
shall provide for recapturing the benefit of any credit allowable under 
subsection (a) with respect to any project which fails to attain or 
maintain the separation and sequestration requirements of subsection 
(e)(1)(G).''.
            (4) Additional priority for research partnerships.--Section 
        48A(e)(3)(B), as amended by paragraph (3)(B), is amended--
                    (A) by striking ``and'' at the end of clause (ii),
                    (B) by redesignating clause (iii) as clause (iv), 
                and
                    (C) by inserting after clause (ii) the following 
                new clause:
                            ``(iii) applicant participants who have a 
                        research partnership with an eligible 
                        educational institution (as defined in section 
                        529(e)(5)), and''.
            (5) Clerical amendment.--Section 48A(e)(3) is amended by 
        striking ``integrated gasification combined cycle'' in the 
        heading and inserting ``certain''.
    (d) Competitive Certification Awards Modification Authority.--
Section 48A (relating to qualifying advanced coal project credit), as 
amended by subsection (c)(3), is amended by adding at the end the 
following new subsection:
    ``(i) Competitive Certification Awards Modification Authority.--In 
implementing this section or section 48B, the Secretary is directed to 
modify the terms of any competitive certification award and any 
associated closing agreement where such modification--
            ``(1) is consistent with the objectives of such section,
            ``(2) is requested by the recipient of the competitive 
        certification award, and
            ``(3) involves moving the project site to improve the 
        potential to capture and sequester carbon dioxide emissions, 
        reduce costs of transporting feedstock, and serve a broader 
        customer base,
unless the Secretary determines that the dollar amount of tax credits 
available to the taxpayer under such section would increase as a result 
of the modification or such modification would result in such project 
not being originally certified. In considering any such modification, 
the Secretary shall consult with other relevant Federal agencies, 
including the Department of Energy.''.
    (e) Effective Dates.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        credits the application for which is submitted during the 
        period described in section 48A(d)(2)(A)(ii) of the Internal 
        Revenue Code of 1986 and which are allocated or reallocated 
        after the date of the enactment of this Act.
            (2) Competitive certification awards modification 
        authority.--The amendment made by subsection (d) shall take 
        effect on the date of the enactment of this Act and is 
        applicable to all competitive certification awards entered into 
        under section 48A or 48B of the Internal Revenue Code of 1986, 
        whether such awards were issued before, on, or after such date 
        of enactment.
            (3) Technical amendment.--The amendment made by subsection 
        (c)(5) shall take effect as if included in the amendment made 
        by section 1307(b) of the Energy Tax Incentives Act of 2005.

               TITLE II--AMERICAN-MADE ENERGY TRUST FUND

SEC. 201. ESTABLISHMENT OF AMERICAN-MADE ENERGY TRUST FUND.

    (a) Creation of Trust Fund.--Subchapter A of chapter 98 of the 
Internal Revenue Code of 1986 is amended by inserting at the end the 
following new section:

``SEC. 9511. AMERICAN-MADE ENERGY TRUST FUND.

    ``(a) Establishment of Trust Fund.--There is established in the 
Treasury of the United States a trust fund to be known as the 
`American-Made Energy Trust Fund', consisting of such amounts as may be 
appropriated or credited to the American-Made Energy Trust Fund as 
provided in this section or section 9602(b).
    ``(b) Transfers to Trust Fund.--There are hereby appropriated to 
the American-Made Energy Trust Fund amounts required to be transferred 
under section 308 of the American-Made Energy Act of 2008 and under 
section 8(g)(6) of the Outer Continental Shelf Lands Act (as added by 
section 703 of the American-Made Energy Act of 2008).
    ``(c) Expenditures From American-Made Energy Trust Fund.--As 
provided by appropriation Acts, amounts in the American-Made Energy 
Trust Fund shall be available in any year for transfer to the general 
fund of the Treasury to offset any reduction in revenue to the United 
States that the Secretary estimates results from the amendments made by 
the American-Made Energy Act of 2008.''.
    (b) Clerical Amendment.--The table of sections for subchapter A of 
chapter 98 of such Code is amended by inserting at the end the 
following new item:

``Sec. 9511. American-Made Energy Trust Fund.''.
    (c) Effective Date.--The amendments made by this section shall 
apply after the date of the enactment of this Act.

TITLE III--DEVELOPMENT OF OIL AND GAS RESOURCES OF THE COASTAL PLAIN OF 
                                 ALASKA

SEC. 301. DEFINITIONS.

    In this title:
            (1) Coastal plain.--The term ``Coastal Plain'' means that 
        area described in appendix I to part 37 of title 50, Code of 
        Federal Regulations.
            (2) Secretary.--The term ``Secretary'', except as otherwise 
        provided, means the Secretary of the Interior or the 
        Secretary's designee.

SEC. 302. LEASING PROGRAM FOR LANDS WITHIN THE COASTAL PLAIN.

    (a) In General.--The Secretary shall take such actions as are 
necessary--
            (1) to establish and implement, in accordance with this 
        title and acting through the Director of the Bureau of Land 
        Management in consultation with the Director of the United 
        States Fish and Wildlife Service, a competitive oil and gas 
        leasing program that will result in an environmentally sound 
        program for the exploration, development, and production of the 
        oil and gas resources of the Coastal Plain; and
            (2) to administer the provisions of this title through 
        regulations, lease terms, conditions, restrictions, 
        prohibitions, stipulations, and other provisions that ensure 
        the oil and gas exploration, development, and production 
        activities on the Coastal Plain will result in no significant 
        adverse effect on fish and wildlife, their habitat, subsistence 
        resources, and the environment, including, in furtherance of 
        this goal, by requiring the application of the best 
        commercially available technology for oil and gas exploration, 
        development, and production to all exploration, development, 
        and production operations under this title in a manner that 
        ensures the receipt of fair market value by the public for the 
        mineral resources to be leased.
The Secretary shall not commence leasing under the program described in 
paragraph (1) unless a finding has been made that bonus bids for 
offered leases are estimated to be not less than $6,000,000,000.
    (b) Repeal.--
            (1) Repeal.--Section 1003 of the Alaska National Interest 
        Lands Conservation Act of 1980 (16 U.S.C. 3143) is repealed.
            (2) Conforming amendment.--The table of contents in section 
        1 of such Act is amended by striking the item relating to 
        section 1003.
    (c) Compliance With Requirements Under Certain Other Laws.--
            (1) Compatibility.--For purposes of the National Wildlife 
        Refuge System Administration Act of 1966 (16 U.S.C. 668dd et 
        seq.), the oil and gas leasing program and activities 
        authorized by this section in the Coastal Plain are deemed to 
        be compatible with the purposes for which the Arctic National 
        Wildlife Refuge was established, and no further findings or 
        decisions are required to implement this determination.
            (2) Adequacy of the department of the interior's 
        legislative environmental impact statement.--The ``Final 
        Legislative Environmental Impact Statement'' (April 1987) on 
        the Coastal Plain prepared pursuant to section 1002 of the 
        Alaska National Interest Lands Conservation Act of 1980 (16 
        U.S.C. 3142) and section 102(2)(C) of the National 
        Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)) is 
        deemed to satisfy the requirements under the National 
        Environmental Policy Act of 1969 that apply with respect to 
        prelease activities, including actions authorized to be taken 
        by the Secretary to develop and promulgate the regulations for 
        the establishment of a leasing program authorized by this title 
        before the conduct of the first lease sale.
            (3) Compliance with nepa for other actions.--Before 
        conducting the first lease sale under this title, the Secretary 
        shall prepare an environmental impact statement under the 
        National Environmental Policy Act of 1969 with respect to the 
        actions authorized by this title that are not referred to in 
        paragraph (2). Notwithstanding any other law, the Secretary is 
        not required to identify nonleasing alternative courses of 
        action or to analyze the environmental effects of such courses 
        of action. The Secretary shall only identify a preferred action 
        for such leasing and a single leasing alternative, and analyze 
        the environmental effects and potential mitigation measures for 
        those two alternatives. The identification of the preferred 
        action and related analysis for the first lease sale under this 
        title shall be completed within 18 months after the date of 
        enactment of this title. The Secretary shall only consider 
        public comments that specifically address the Secretary's 
        preferred action and that are filed within 20 days after 
        publication of an environmental analysis. Notwithstanding any 
        other law, compliance with this paragraph is deemed to satisfy 
        all requirements for the analysis and consideration of the 
        environmental effects of proposed leasing under this title.
    (d) Relationship to State and Local Authority.--Nothing in this 
title shall be considered to expand or limit State and local regulatory 
authority.
    (e) Special Areas.--
            (1) In general.--The Secretary, after consultation with the 
        State of Alaska, the city of Kaktovik, and the North Slope 
        Borough, may designate up to a total of 45,000 acres of the 
        Coastal Plain as a Special Area if the Secretary determines 
        that the Special Area is of such unique character and interest 
        so as to require special management and regulatory protection. 
        The Secretary shall designate as such a Special Area the 
        Sadlerochit Spring area, comprising approximately 4,000 acres.
            (2) Management.--Each such Special Area shall be managed so 
        as to protect and preserve the area's unique and diverse 
        character including its fish, wildlife, and subsistence 
        resource values.
            (3) Exclusion from leasing or surface occupancy.--The 
        Secretary may exclude any Special Area from leasing. If the 
        Secretary leases a Special Area, or any part thereof, for 
        purposes of oil and gas exploration, development, production, 
        and related activities, there shall be no surface occupancy of 
        the lands comprising the Special Area.
            (4) Directional drilling.--Notwithstanding the other 
        provisions of this subsection, the Secretary may lease all or a 
        portion of a Special Area under terms that permit the use of 
        horizontal drilling technology from sites on leases located 
        outside the Special Area.
    (f) Limitation on Closed Areas.--The Secretary's sole authority to 
close lands within the Coastal Plain to oil and gas leasing and to 
exploration, development, and production is that set forth in this 
title.
    (g) Regulations.--
            (1) In general.--The Secretary shall prescribe such 
        regulations as may be necessary to carry out this title, 
        including rules and regulations relating to protection of the 
        fish and wildlife, their habitat, subsistence resources, and 
        environment of the Coastal Plain, by no later than 15 months 
        after the date of enactment of this title.
            (2) Revision of regulations.--The Secretary shall 
        periodically review and, if appropriate, revise the rules and 
        regulations issued under subsection (a) to reflect any 
        significant biological, environmental, or engineering data that 
        come to the Secretary's attention.

SEC. 303. LEASE SALES.

    (a) In General.--Lands may be leased pursuant to this title to any 
person qualified to obtain a lease for deposits of oil and gas under 
the Mineral Leasing Act (30 U.S.C. 181 et seq.).
    (b) Procedures.--The Secretary shall, by regulation, establish 
procedures for--
            (1) receipt and consideration of sealed nominations for any 
        area in the Coastal Plain for inclusion in, or exclusion (as 
        provided in subsection (c)) from, a lease sale;
            (2) the holding of lease sales after such nomination 
        process; and
            (3) public notice of and comment on designation of areas to 
        be included in, or excluded from, a lease sale.
    (c) Lease Sale Bids.--Bidding for leases under this title shall be 
by sealed competitive cash bonus bids.
    (d) Acreage Minimum in First Sale.--In the first lease sale under 
this title, the Secretary shall offer for lease those tracts the 
Secretary considers to have the greatest potential for the discovery of 
hydrocarbons, taking into consideration nominations received pursuant 
to subsection (b)(1), but in no case less than 200,000 acres.
    (e) Timing of Lease Sales.--The Secretary shall--
            (1) conduct the first lease sale under this title within 22 
        months after the date of the enactment of this title; and
            (2) conduct additional sales so long as sufficient interest 
        in development exists to warrant, in the Secretary's judgment, 
        the conduct of such sales.

SEC. 304. GRANT OF LEASES BY THE SECRETARY.

    (a) In General.--The Secretary may grant to the highest responsible 
qualified bidder in a lease sale conducted pursuant to section 303 any 
lands to be leased on the Coastal Plain upon payment by the lessee of 
such bonus as may be accepted by the Secretary.
    (b) Subsequent Transfers.--No lease issued under this title may be 
sold, exchanged, assigned, sublet, or otherwise transferred except with 
the approval of the Secretary. Prior to any such approval the Secretary 
shall consult with, and give due consideration to the views of, the 
Attorney General.

SEC. 305. LEASE TERMS AND CONDITIONS.

    (a) In General.--An oil or gas lease issued pursuant to this title 
shall--
            (1) provide for the payment of a royalty of not less than 
        12\1/2\ percent in amount or value of the production removed or 
        sold from the lease, as determined by the Secretary under the 
        regulations applicable to other Federal oil and gas leases;
            (2) provide that the Secretary may close, on a seasonal 
        basis, portions of the Coastal Plain to exploratory drilling 
        activities as necessary to protect caribou calving areas and 
        other species of fish and wildlife;
            (3) require that the lessee of lands within the Coastal 
        Plain shall be fully responsible and liable for the reclamation 
        of lands within the Coastal Plain and any other Federal lands 
        that are adversely affected in connection with exploration, 
        development, production, or transportation activities conducted 
        under the lease and within the Coastal Plain by the lessee or 
        by any of the subcontractors or agents of the lessee;
            (4) provide that the lessee may not delegate or convey, by 
        contract or otherwise, the reclamation responsibility and 
        liability to another person without the express written 
        approval of the Secretary;
            (5) provide that the standard of reclamation for lands 
        required to be reclaimed under this title shall be, as nearly 
        as practicable, a condition capable of supporting the uses 
        which the lands were capable of supporting prior to any 
        exploration, development, or production activities, or upon 
        application by the lessee, to a higher or better use as 
        approved by the Secretary;
            (6) contain terms and conditions relating to protection of 
        fish and wildlife, their habitat, subsistence resources, and 
        the environment as required pursuant to section 302(a)(2);
            (7) provide that the lessee, its agents, and its 
        contractors use best efforts to provide a fair share, as 
        determined by the level of obligation previously agreed to in 
        the 1974 agreement implementing section 29 of the Federal 
        Agreement and Grant of Right of Way for the Operation of the 
        Trans-Alaska Pipeline, of employment and contracting for Alaska 
        Natives and Alaska Native Corporations from throughout the 
        State; and
            (8) contain such other provisions as the Secretary 
        determines necessary to ensure compliance with the provisions 
        of this title and the regulations issued under this title.
    (b) Project Labor Agreements.--The Secretary, as a term and 
condition of each lease under this title and in recognizing the 
Government's proprietary interest in labor stability and in the ability 
of construction labor and management to meet the particular needs and 
conditions of projects to be developed under the leases issued pursuant 
to this title and the special concerns of the parties to such leases, 
shall require that the lessee and its agents and contractors negotiate 
to obtain a project labor agreement for the employment of laborers and 
mechanics on production, maintenance, and construction under the lease.

SEC. 306. COASTAL PLAIN ENVIRONMENTAL PROTECTION.

    (a) No Significant Adverse Effect Standard To Govern Authorized 
Coastal Plain Activities.--The Secretary shall, consistent with the 
requirements of section 302, administer the provisions of this title 
through regulations, lease terms, conditions, restrictions, 
prohibitions, stipulations, and other provisions that--
            (1) ensure the oil and gas exploration, development, and 
        production activities on the Coastal Plain will result in no 
        significant adverse effect on fish and wildlife, their habitat, 
        and the environment;
            (2) require the application of the best commercially 
        available technology for oil and gas exploration, development, 
        and production on all new exploration, development, and 
        production operations; and
            (3) ensure that the maximum amount of surface acreage 
        covered by production and support facilities, including 
        airstrips and any areas covered by gravel berms or piers for 
        support of pipelines, does not exceed 2,000 acres on the 
        Coastal Plain.
    (b) Site-Specific Assessment and Mitigation.--The Secretary shall 
also require, with respect to any proposed drilling and related 
activities, that--
            (1) a site-specific analysis be made of the probable 
        effects, if any, that the drilling or related activities will 
        have on fish and wildlife, their habitat, subsistence 
        resources, and the environment;
            (2) a plan be implemented to avoid, minimize, and mitigate 
        (in that order and to the extent practicable) any significant 
        adverse effect identified under paragraph (1); and
            (3) the development of the plan shall occur after 
        consultation with the agency or agencies having jurisdiction 
        over matters mitigated by the plan.
    (c) Regulations to Protect Coastal Plain Fish and Wildlife 
Resources, Subsistence Users, and the Environment.--Before implementing 
the leasing program authorized by this title, the Secretary shall 
prepare and promulgate regulations, lease terms, conditions, 
restrictions, prohibitions, stipulations, and other measures designed 
to ensure that the activities undertaken on the Coastal Plain under 
this title are conducted in a manner consistent with the purposes and 
environmental requirements of this title.
    (d) Compliance With Federal and State Environmental Laws and Other 
Requirements.--The proposed regulations, lease terms, conditions, 
restrictions, prohibitions, and stipulations for the leasing program 
under this title shall require compliance with all applicable 
provisions of Federal and State environmental law, and shall also 
require the following:
            (1) Standards at least as effective as the safety and 
        environmental mitigation measures set forth in items 1 through 
        29 at pages 167 through 169 of the ``Final Legislative 
        Environmental Impact Statement'' (April 1987) on the Coastal 
        Plain.
            (2) Seasonal limitations on exploration, development, and 
        related activities, where necessary, to avoid significant 
        adverse effects during periods of concentrated fish and 
        wildlife breeding, denning, nesting, spawning, and migration.
            (3) That exploration activities, except for surface 
        geological studies, be limited to the period between 
        approximately November 1 and May 1 each year and that 
        exploration activities shall be supported, if necessary, by ice 
        roads, winter trails with adequate snow cover, ice pads, ice 
        airstrips, and air transport methods, except that such 
        exploration activities may occur at other times if the 
        Secretary finds that such exploration will have no significant 
        adverse effect on the fish and wildlife, their habitat, and the 
        environment of the Coastal Plain.
            (4) Design safety and construction standards for all 
        pipelines and any access and service roads, that--
                    (A) minimize, to the maximum extent possible, 
                adverse effects upon the passage of migratory species 
                such as caribou; and
                    (B) minimize adverse effects upon the flow of 
                surface water by requiring the use of culverts, 
                bridges, and other structural devices.
            (5) Prohibitions on general public access and use on all 
        pipeline access and service roads.
            (6) Stringent reclamation and rehabilitation requirements, 
        consistent with the standards set forth in this title, 
        requiring the removal from the Coastal Plain of all oil and gas 
        development and production facilities, structures, and 
        equipment upon completion of oil and gas production operations, 
        except that the Secretary may exempt from the requirements of 
        this paragraph those facilities, structures, or equipment that 
        the Secretary determines would assist in the management of the 
        Arctic National Wildlife Refuge and that are donated to the 
        United States for that purpose.
            (7) Appropriate prohibitions or restrictions on access by 
        all modes of transportation.
            (8) Appropriate prohibitions or restrictions on sand and 
        gravel extraction.
            (9) Consolidation of facility siting.
            (10) Appropriate prohibitions or restrictions on use of 
        explosives.
            (11) Avoidance, to the extent practicable, of springs, 
        streams, and river system; the protection of natural surface 
        drainage patterns, wetlands, and riparian habitats; and the 
        regulation of methods or techniques for developing or 
        transporting adequate supplies of water for exploratory 
        drilling.
            (12) Avoidance or minimization of air traffic-related 
        disturbance to fish and wildlife.
            (13) Treatment and disposal of hazardous and toxic wastes, 
        solid wastes, reserve pit fluids, drilling muds and cuttings, 
        and domestic wastewater, including an annual waste management 
        report, a hazardous materials tracking system, and a 
        prohibition on chlorinated solvents, in accordance with 
        applicable Federal and State environmental law.
            (14) Fuel storage and oil spill contingency planning.
            (15) Research, monitoring, and reporting requirements.
            (16) Field crew environmental briefings.
            (17) Avoidance of significant adverse effects upon 
        subsistence hunting, fishing, and trapping by subsistence 
        users.
            (18) Compliance with applicable air and water quality 
        standards.
            (19) Appropriate seasonal and safety zone designations 
        around well sites, within which subsistence hunting and 
        trapping shall be limited.
            (20) Reasonable stipulations for protection of cultural and 
        archeological resources.
            (21) All other protective environmental stipulations, 
        restrictions, terms, and conditions deemed necessary by the 
        Secretary.
    (e) Considerations.--In preparing and promulgating regulations, 
lease terms, conditions, restrictions, prohibitions, and stipulations 
under this section, the Secretary shall consider the following:
            (1) The stipulations and conditions that govern the 
        National Petroleum Reserve-Alaska leasing program, as set forth 
        in the 1999 Northeast National Petroleum Reserve-Alaska Final 
        Integrated Activity Plan/Environmental Impact Statement.
            (2) The environmental protection standards that governed 
        the initial Coastal Plain seismic exploration program under 
        parts 37.31 to 37.33 of title 50, Code of Federal Regulations.
            (3) The land use stipulations for exploratory drilling on 
        the KIC-ASRC private lands that are set forth in Appendix 2 of 
        the August 9, 1983, agreement between Arctic Slope Regional 
        Corporation and the United States.
    (f) Facility Consolidation Planning.--
            (1) In general.--The Secretary shall, after providing for 
        public notice and comment, prepare and update periodically a 
        plan to govern, guide, and direct the siting and construction 
        of facilities for the exploration, development, production, and 
        transportation of Coastal Plain oil and gas resources.
            (2) Objectives.--The plan shall have the following 
        objectives:
                    (A) Avoiding unnecessary duplication of facilities 
                and activities.
                    (B) Encouraging consolidation of common facilities 
                and activities.
                    (C) Locating or confining facilities and activities 
                to areas that will minimize impact on fish and 
                wildlife, their habitat, and the environment.
                    (D) Utilizing existing facilities wherever 
                practicable.
                    (E) Enhancing compatibility between wildlife values 
                and development activities.
    (g) Access to Public Lands.--The Secretary shall--
            (1) manage public lands in the Coastal Plain subject to 
        subsections (a) and (b) of section 811 of the Alaska National 
        Interest Lands Conservation Act (16 U.S.C. 3121); and
            (2) ensure that local residents shall have reasonable 
        access to public lands in the Coastal Plain for traditional 
        uses.

SEC. 307. EXPEDITED JUDICIAL REVIEW.

    (a) Filing of Complaint.--
            (1) Deadline.--Subject to paragraph (2), any complaint 
        seeking judicial review of any provision of this title or any 
        action of the Secretary under this title shall be filed--
                    (A) except as provided in subparagraph (B), within 
                the 90-day period beginning on the date of the action 
                being challenged; or
                    (B) in the case of a complaint based solely on 
                grounds arising after such period, within 90 days after 
                the complainant knew or reasonably should have known of 
                the grounds for the complaint.
            (2) Venue.--Any complaint seeking judicial review of any 
        provision of this title or any action of the Secretary under 
        this title may be filed only in the United States Court of 
        Appeals for the District of Columbia.
            (3) Limitation on scope of certain review.--Judicial review 
        of a Secretarial decision to conduct a lease sale under this 
        title, including the environmental analysis thereof, shall be 
        limited to whether the Secretary has complied with the terms of 
        this title and shall be based upon the administrative record of 
        that decision. The Secretary's identification of a preferred 
        course of action to enable leasing to proceed and the 
        Secretary's analysis of environmental effects under this title 
        shall be presumed to be correct unless shown otherwise by clear 
        and convincing evidence to the contrary.
    (b) Limitation on Other Review.--Actions of the Secretary with 
respect to which review could have been obtained under this section 
shall not be subject to judicial review in any civil or criminal 
proceeding for enforcement.

SEC. 308. FEDERAL AND STATE DISTRIBUTION OF REVENUES.

    (a) In General.--Notwithstanding any other provision of law, of the 
amount of adjusted bonus, rental, and royalty revenues from Federal oil 
and gas leasing and operations authorized under this title--
            (1) 50 percent shall be paid to the State of Alaska; and
            (2) except as provided in section 311(d), the balance shall 
        be transferred to the American-Made Energy Trust Fund.
    (b) Payments to Alaska.--Payments to the State of Alaska under this 
section shall be made semiannually.

SEC. 309. RIGHTS-OF-WAY ACROSS THE COASTAL PLAIN.

    (a) In General.--The Secretary shall issue rights-of-way and 
easements across the Coastal Plain for the transportation of oil and 
gas--
            (1) except as provided in paragraph (2), under section 28 
        of the Mineral Leasing Act (30 U.S.C. 185), without regard to 
        title XI of the Alaska National Interest Lands Conservation Act 
        (30 U.S.C. 3161 et seq.); and
            (2) under title XI of the Alaska National Interest Lands 
        Conservation Act (30 U.S.C. 3161 et seq.), for access 
        authorized by sections 1110 and 1111 of that Act (16 U.S.C. 
        3170 and 3171).
    (b) Terms and Conditions.--The Secretary shall include in any 
right-of-way or easement issued under subsection (a) such terms and 
conditions as may be necessary to ensure that transportation of oil and 
gas does not result in a significant adverse effect on the fish and 
wildlife, subsistence resources, their habitat, and the environment of 
the Coastal Plain, including requirements that facilities be sited or 
designed so as to avoid unnecessary duplication of roads and pipelines.
    (c) Regulations.--The Secretary shall include in regulations under 
section 302(g) provisions granting rights-of-way and easements 
described in subsection (a) of this section.

SEC. 310. CONVEYANCE.

    In order to maximize Federal revenues by removing clouds on title 
to lands and clarifying land ownership patterns within the Coastal 
Plain, the Secretary, notwithstanding the provisions of section 
1302(h)(2) of the Alaska National Interest Lands Conservation Act (16 
U.S.C. 3192(h)(2)), shall convey--
            (1) to the Kaktovik Inupiat Corporation the surface estate 
        of the lands described in paragraph 1 of Public Land Order 
        6959, to the extent necessary to fulfill the Corporation's 
        entitlement under sections 12 and 14 of the Alaska Native 
        Claims Settlement Act (43 U.S.C. 1611 and 1613) in accordance 
        with the terms and conditions of the Agreement between the 
        Department of the Interior, the United States Fish and Wildlife 
        Service, the Bureau of Land Management, and the Kaktovik 
        Inupiat Corporation effective January 22, 1993; and
            (2) to the Arctic Slope Regional Corporation the remaining 
        subsurface estate to which it is entitled pursuant to the 
        August 9, 1983, agreement between the Arctic Slope Regional 
        Corporation and the United States of America.

SEC. 311. LOCAL GOVERNMENT IMPACT AID AND COMMUNITY SERVICE ASSISTANCE.

    (a) Financial Assistance Authorized.--
            (1) In general.--The Secretary may use amounts available 
        from the Coastal Plain Local Government Impact Aid Assistance 
        Fund established by subsection (d) to provide timely financial 
        assistance to entities that are eligible under paragraph (2) 
        and that are directly impacted by the exploration for or 
        production of oil and gas on the Coastal Plain under this 
        title.
            (2) Eligible entities.--The North Slope Borough, the City 
        of Kaktovik, and any other borough, municipal subdivision, 
        village, or other community in the State of Alaska that is 
        directly impacted by exploration for, or the production of, oil 
        or gas on the Coastal Plain under this title, as determined by 
        the Secretary, shall be eligible for financial assistance under 
        this section.
    (b) Use of Assistance.--Financial assistance under this section may 
be used only for--
            (1) planning for mitigation of the potential effects of oil 
        and gas exploration and development on environmental, social, 
        cultural, recreational, and subsistence values;
            (2) implementing mitigation plans and maintaining 
        mitigation projects;
            (3) developing, carrying out, and maintaining projects and 
        programs that provide new or expanded public facilities and 
        services to address needs and problems associated with such 
        effects, including fire-fighting, police, water, waste 
        treatment, medivac, and medical services; and
            (4) establishment of a coordination office, by the north 
        slope borough, in the city of kaktovik, which shall--
                    (A) coordinate with and advise developers on local 
                conditions, impact, and history of the areas utilized 
                for development; and
                    (B) provide to the Committee on Resources of the 
                House of Representatives and the Committee on Energy 
                and Natural Resources of the Senate an annual report on 
                the status of coordination between developers and the 
                communities affected by development.
    (c) Application.--
            (1) In general.--Any community that is eligible for 
        assistance under this section may submit an application for 
        such assistance to the Secretary, in such form and under such 
        procedures as the Secretary may prescribe by regulation.
            (2) North slope borough communities.--A community located 
        in the North Slope Borough may apply for assistance under this 
        section either directly to the Secretary or through the North 
        Slope Borough.
            (3) Application assistance.--The Secretary shall work 
        closely with and assist the North Slope Borough and other 
        communities eligible for assistance under this section in 
        developing and submitting applications for assistance under 
        this section.
    (d) Establishment of Fund.--
            (1) In general.--There is established in the Treasury the 
        Coastal Plain Local Government Impact Aid Assistance Fund.
            (2) Use.--Amounts in the fund may be used only for 
        providing financial assistance under this section.
            (3) Deposits.--Subject to paragraph (4), there shall be 
        deposited into the fund amounts received by the United States 
        as revenues derived from rents, bonuses, and royalties from 
        Federal leases and lease sales authorized under this title.
            (4) Limitation on deposits.--The total amount in the fund 
        may not exceed $11,000,000.
            (5) Investment of balances.--The Secretary of the Treasury 
        shall invest amounts in the fund in interest bearing government 
        securities.
    (e) Authorization of Appropriations.--To provide financial 
assistance under this section there is authorized to be appropriated to 
the Secretary from the Coastal Plain Local Government Impact Aid 
Assistance Fund $5,000,000 for each fiscal year.

                TITLE IV--COAL-TO-LIQUID FUEL PROMOTION

SEC. 401. STRATEGIC PETROLEUM RESERVE.

    (a) Development, Operation, and Maintenance of Reserve.--Section 
159 of the Energy Policy and Conservation Act (42 U.S.C. 6239) is 
amended--
            (1) by redesignating subsections (f), (g), (j), (k), and 
        (l) as subsections (a), (b), (e), (f), and (g), respectively; 
        and
            (2) by inserting after subsection (b) (as redesignated by 
        paragraph (1)) the following:
    ``(c) Study of Maintaining Coal-to-Liquid Products in Reserve.--Not 
later than 1 year after the date of enactment of the American-Made 
Energy Act of 2008, the Secretary and the Secretary of Defense shall--
            ``(1) conduct a study of the feasibility and suitability of 
        maintaining coal-to-liquid products in the Reserve; and
            ``(2) submit to the Committee on Energy and Natural 
        Resources and the Committee on Armed Services of the Senate and 
        the Committee on Energy and Commerce and the Committee on Armed 
        Services of the House of Representatives a report describing 
        the results of the study.
    ``(d) Construction of Storage Facilities.--As soon as practicable 
after the date of enactment of the American-Made Energy Act of 2008, 
the Secretary may construct 1 or more storage facilities--
            ``(1) in the vicinity of pipeline infrastructure and at 
        least 1 military base; but
            ``(2) outside the boundaries of any State on the coast of 
        the Gulf of Mexico.''.
    (b) Petroleum Products for Storage in Reserve.--Section 160 of the 
Energy Policy and Conservation Act (42 U.S.C. 6240) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1), by inserting a semicolon at 
                the end;
                    (B) in paragraph (2), by striking ``and'' at the 
                end;
                    (C) in paragraph (3), by striking the period at the 
                end and inserting ``; and''; and
                    (D) by adding at the end the following:
            ``(4) coal-to-liquid fuel (as defined in section 404 of the 
        American-Made Energy Act of 2008), as the Secretary determines 
        to be appropriate, in a quantity not to exceed 20 percent of 
        the total quantity of petroleum products in the Reserve.'';
            (2) in subsection (b), by redesignating paragraphs (3) 
        through (5) as paragraphs (2) through (4), respectively; and
            (3) by redesignating subsections (f) and (h) as subsections 
        (d) and (e), respectively.
    (c) Conforming Amendments.--Section 167 of the Energy Policy and 
Conservation Act (42 U.S.C. 6247) is amended--
            (1) in subsection (b)--
                    (A) by redesignating paragraphs (2) and (3) as 
                paragraphs (1) and (2), respectively; and
                    (B) in paragraph (2) (as redesignated by 
                subparagraph (A)), by striking ``section 160(f)'' and 
                inserting ``section 160(e)''; and
            (2) in subsection (d), in the matter preceding paragraph 
        (1), by striking ``section 160(f)'' and inserting ``section 
        160(e)''.

SEC. 402. PROCUREMENT OF UNCONVENTIONAL FUELS BY THE DEPARTMENT OF 
              DEFENSE.

    Section 2398a of title 10, United States Code, is amended--
            (1) in subsection (b)--
                    (A) by striking ``The Secretary'' and inserting 
                ``(1) The Secretary'';
                    (B) by inserting after ``covered fuel'' the 
                following: ``, biobased fuel, or coal-to-liquid fuel''; 
                and
                    (C) by adding at the end the following:
    ``(2)(A) The Secretary of Defense may enter into contracts or other 
agreements with private companies or other entities to develop and 
operate qualified coal-to-liquid facilities (as defined in section 404 
of the American-Made Energy Act of 2008) on or near military 
installations.
    ``(B) In entering into contracts and other agreements under 
subparagraph (A), the Secretary shall consider land availability, 
testing opportunities, and proximity to raw materials.'';
            (2) in subsection (d)--
                    (A) by inserting after ``covered fuel'' the 
                following: ``biobased fuel, or coal-to-liquid fuel''; 
                and
                    (B) by striking ``1 or more years'' and inserting 
                ``up to 25 years''; and
            (3) by adding at the end the following:
    ``(f) Definitions.--In this section:
            ``(1) The term `coal-to-liquid fuel' means a fuel produced 
        from a coal-to-liquid process or technology in a qualified 
        coal-to-liquid facility (as defined in section 404 of American-
        Made Energy Act of 2008.
            ``(2) The term `coal-to-liquid' means a proces within the 
        meaning of section 404 of the American-Made Energy Act of 
        2008.''.

SEC. 403. GOVERNMENT AUCTION OF LONG TERM PUT OPTION CONTRACTS ON COAL-
              TO-LIQUID FUEL PRODUCED BY QUALIFIED COAL-TO-LIQUID 
              FACILITIES.

    (a) In General.--The Secretary shall, from time to time, auction to 
the public coal-to-liquid fuel put option contracts having expiration 
dates of 5 years, 10 years, 15 years, or 20 years.
    (b) Consultation With Secretary of Energy.--The Secretary shall 
consult with the Secretary of Energy regarding--
            (1) the frequency of the auctions;
            (2) the strike prices specified in the contracts;
            (3) the number of contracts to be auctioned with a given 
        strike price and expiration date; and
            (4) the capacity of existing or planned facilities to 
        produce coal-to-liquid fuel.
    (c) Definitions.--In this section:
            (1) Coal-to-liquid put option contract.--The term ``coal-
        to-liquid put option contract'' means a contract, written by 
        the Secretary, which--
                    (A) gives the holder the right (but not the 
                obligation) to sell to the Government of the United 
                States a certain quantity of a specific type of coal-
                to-liquid fuel produced by a qualified coal-to-liquid 
                facility specified in the contract, at a strike price 
                specified in the contract, on or before an expiration 
                date specified in the contract; and
                    (B) is transferable by the holder to any other 
                entity.
            (2) Secretary.--The term ``Secretary'' means the Secretary 
        of the Treasury.
            (3) Strike price.--The term ``strike price'' means, with 
        respect to a put option contract, the price at which the holder 
        of the contract has the right to sell the fuel which is the 
        subject of the contract.
    (d) Regulations.--The Secretary shall prescribe such regulations as 
may be necessary to carry out this section.
    (e) Effective Date.--This section shall take effect 1 year after 
the date of the enactment of this Act.

SEC. 404. DEFINITIONS.

    For purposes of this title (except as otherwise provided)--
            (1) Coal-to-liquid fuel.--The term ``coal-to-liquid fuel'' 
        means any transportation-grade liquid fuel derived primarily 
        from coal (including peat) and produced at a qualified coal-to-
        liquid facility.
            (2) Qualified coal-to-liquid facility.--The term 
        ``qualified coal-to-liquid facility'' means a manufacturing 
        facility that has the capacity to produce at least 10,000 
        barrels per day of transportation grade liquid fuels from a 
        feedstock that is primarily domestic coal (including peat and 
        any property which allows for the capture, transportation, or 
        sequestration of by-products resulting from such process, 
        including carbon emissions).
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.

                        TITLE V--BIOFUEL PROGRAM

SEC. 501. GRANTS FOR CELLULOSIC ETHANOL PRODUCTION.

    Subsection (s) of section 211 of the Clean Air Act (as added by 
section 1512 of the Energy Policy Act of 2005) (and as redesignated by 
section 9307 of this Act), relating to conversion assistance for 
cellulosic biomass, waste-derived ethanol, and approved renewable 
fuels, is amended as follows:
            (1) By adding the following new subparagraphs at the end of 
        paragraph (3):
                    ``(D) $500,000,000 for fiscal year 2009.
                    ``(E) $500,000,000 for fiscal year 2010.''.
            (2) By adding the following new paragraph at the end 
        thereof:
            ``(5) Criteria.--In awarding grants under this section, the 
        Secretary shall give priority to applications that promote 
        feedstock diversity and the geographic dispersion of production 
        facilities.''.

SEC. 502. LOAN GUARANTEES FOR BIOREFINERIES AND BIOFUEL PRODUCTION 
              PLANTS.

    Section 9003 of the Farm Security and Rural Investment Act of 2002 
(7 U.S.C. 8103) is amended--
            (1) in the section heading, by inserting ``; loan 
        guarantees for biorefineries and biofuel production plants'' 
        after ``grants'';
            (2) in subsection (b)(2)(A), by striking ``and'' the 1st 
        place it appears and inserting ``or'';
            (3) in subsection (c), by redesignating subsection (h ) as 
        subsection (i) and subsections (d) through (g) as subsections 
        (e) through (h ), respectively, and inserting after subsection 
        (c) the following:
    ``(d) Loan Guarantees.--
            ``(1) In general.--The Secretary shall make loan guarantees 
        to eligible entities to assist in paying the cost of 
        development and construction of biorefineries and biofuel 
        production plants (including retrofitting) to carry out 
        projects to demonstrate the commercial viability of 1 or more 
        processes for converting biomass to fuels or chemicals.
            ``(2) Limitations.--
                    ``(A) Maximum percentage of loan guaranteed.--A 
                loan guarantee under paragraph (1) shall be for not 
                more than 90 percent of the principal and interest due 
                on the loan.
                    ``(B) Total amounts guaranteed.--The total amount 
                of principal and interest guaranteed under paragraph 
                (1) shall not exceed--
                            ``(i) $600,000,000, in the case of loans 
                        valued at not more than $100,000,000; or
                            ``(ii) $1,000,000,000, in the case of loans 
                        valued at more than $100,000,000 but not more 
                        than $250,000,000.
                    ``(C) Maximum term of loan guaranteed.--The 
                Secretary shall determine the maximum term of a loan 
                guarantee provided under paragraph (1).'';
            (4) in subsection (f) (as so redesignated)--
                    (A) in paragraph (1), by inserting ``and loan 
                guarantees under subsection (d)'' after ``(c)'';
                    (B) in paragraph (2)(A), by inserting ``or loan 
                guarantees under subsection (d)'' after ``(c)'';
                    (C) in paragraph (2)(B)--
                            (i) by striking ``and'' at the end of 
                        clause (viii);
                            (ii) by striking the period at the end of 
                        clause (ix) and inserting ``; and''; and
                            (iii) by adding at the end the following:
    ``(x) The level of local ownership.''; and
                    (D) by adding at the end the following:
            ``(3) Priority in awarding loan guarantees.--In selecting 
        projects to receive loan guarantees under subsection (d), the 
        Secretary shall give priority to projects based on the criteria 
        set forth in paragraph (2)(B) of this subsection.'';
            (5) in subsection (i), by striking ``2007'' and inserting 
        ``2012''; and
            (6) by adding at the end the following new subsections:
    ``(j) Additional Funding for Loan Guarantees.--Of the funds of the 
Commodity Credit Corporation, the Secretary shall use to carry out this 
section--
            ``(1) $50,000,000 for fiscal year 2008;
            ``(2) $65,000,000 for fiscal year 2009;
            ``(3) $75,000,000 for fiscal year 2010;
            ``(4) $150,000,000 for fiscal year 2011; and
            ``(5) $250,000,000 for fiscal year 2012.
    ``(k) Continuation of Operations.--
            ``(1) Funding.--The Secretary shall continue to carry out 
        this section at the rate of operation in effect on September 
        30, 2012, from sums in the Treasury not otherwise appropriated, 
        through September 30, 2017.
            ``(2) Authority.--The program and authorities provided 
        under this section shall continue in force and effect through 
        September 30, 2017.''.

SEC. 503. BIOMASS RESEARCH AND DEVELOPMENT ACT OF 2000.

    (a) Restatement, Extension, and Increased Funding of Act.--Section 
9008 of the Farm Security and Rural Investment Act of 2002 (Public Law 
107-171; 116 Stat. 486) is amended to read as follows:

``SEC. 9008. BIOMASS RESEARCH AND DEVELOPMENT ACT OF 2000.

    ``(a) Short Title.--This section may be cited as the `Biomass 
Research and Development Act of 2000'.
    ``(b) Findings.--Congress finds that--
            ``(1) conversion of biomass into biobased industrial 
        products offers outstanding potential for benefit to the 
        national interest through--
                    ``(A) improved strategic security and balance of 
                payments;
                    ``(B) healthier rural economies;
                    ``(C) improved environmental quality;
                    ``(D) near-zero net greenhouse gas emissions;
                    ``(E) technology export; and
                    ``(F) sustainable resource supply;
            ``(2) the key technical challenges to be overcome in order 
        for biobased industrial products to be cost-competitive are 
        finding new technology and reducing the cost of technology for 
        converting biomass into desired biobased industrial products;
            ``(3) biobased fuels have the clear potential to be 
        sustainable, low cost, and high performance fuels that are 
        compatible with both current and future transportation systems 
        and provide near-zero net greenhouse gas emissions;
            ``(4) biobased chemicals have the clear potential for 
        environmentally benign product life cycles;
            ``(5) biobased power can--
                    ``(A) provide environmental benefits;
                    ``(B) promote rural economic development; and
                    ``(C) diversify energy resource options;
            ``(6) many biomass feedstocks suitable for industrial 
        processing show the clear potential for sustainable production, 
        in some cases resulting in improved soil fertility and carbon 
        sequestration;
            ``(7)(A) grain processing mills are biorefineries that 
        produce a diversity of useful food, chemical, feed, and fuel 
        products; and
            ``(B) technologies that result in further diversification 
        of the range of value-added biobased industrial products can 
        meet a key need for the grain processing industry;
            ``(8)(A) cellulosic feedstocks are attractive because of 
        their low cost and widespread availability; and
            ``(B) research resulting in cost-effective technology to 
        overcome the recalcitrance of cellulosic biomass would allow 
        biorefineries to produce fuels and bulk chemicals on a very 
        large scale, with a commensurately large realization of the 
        benefit described in paragraph (1);
            ``(9) research into the fundamentals to understand 
        important mechanisms of biomass conversion can be expected to 
        accelerate the application and advancement of biomass 
        processing technology by--
                    ``(A) increasing the confidence and speed with 
                which new technologies can be scaled up; and
                    ``(B) giving rise to processing innovations based 
                on new knowledge;
            ``(10) the added utility of biobased industrial products 
        developed through improvements in processing technology would 
        encourage the design of feedstocks that would meet future needs 
        more effectively;
            ``(11) the creation of value-added biobased industrial 
        products would create new jobs in construction, manufacturing, 
        and distribution, as well as new higher-valued exports of 
        products and technology;
            ``(12)(A) because of the relatively short-term time horizon 
        characteristic of private sector investments, and because many 
        benefits of biomass processing are in the national interest, it 
        is appropriate for the Federal Government to provide 
        precommercial investment in fundamental research and research-
        driven innovation in the biomass processing area; and
            ``(B) such an investment would provide a valuable 
        complement to ongoing and past governmental support in the 
        biomass processing area; and
            ``(13) several prominent studies, including studies by the 
        President's Committee of Advisors on Science and Technology and 
        the National Research Council--
                    ``(A) support the potential for large research-
                driven advances in technologies for production of 
                biobased industrial products as well as associated 
                benefits; and
                    ``(B) document the need for a focused, integrated, 
                and innovation-driven research effort to provide the 
                appropriate progress in a timely manner.
    ``(c) Definitions.--In this section:
            ``(1) Advisory committee.--The term `Advisory Committee' 
        means the Biomass Research and Development Technical Advisory 
        Committee established by this section.
            ``(2) Biobased fuel.--The term `biobased fuel' means any 
        transportation or heating fuel produced from biomass.
            ``(3) Biobased product.--The term `biobased product' means 
        an industrial product (including chemicals, materials, and 
        polymers) produced from biomass, or a commercial or industrial 
        product (including animal feed and electric power) derived in 
        connection with the conversion of biomass to fuel.
            ``(4) Biomass.--The term `biomass' means any organic matter 
        that is available on a renewable or recurring basis, including 
        agricultural crops and trees, wood and wood wastes and 
        residues, plants (including aquatic plants), grasses, residues, 
        fibers, and animal wastes, municipal wastes, and other waste 
        materials.
            ``(5) Board.--The term `Board' means the Biomass Research 
        and Development Board established by this section.
            ``(6) Demonstration.--The term `demonstration' means 
        demonstration of technology in a pilot plant or semi-works 
        scale facility.
            ``(7) Initiative.--The term `Initiative' means the Biomass 
        Research and Development Initiative established under this 
        section.
            ``(8) Institution of higher education.--The term 
        `institution of higher education' has the meaning given the 
        term in section 102(a) of the Higher Education Act of 1965 (20 
        U.S.C. 1002(a)).
            ``(9) National laboratory.--The term `National Laboratory' 
        has the meaning given that term in section 2 of the Energy 
        Policy Act of 2005.
            ``(10) Point of contact.--The term `point of contact' means 
        a point of contact designated under this section.
    ``(d) Cooperation and Coordination in Biomass Research and 
Development.--
            ``(1) In general.--The Secretary of Agriculture and the 
        Secretary of Energy shall cooperate with respect to, and 
        coordinate, policies and procedures that promote research and 
        development leading to the production of biobased fuels and 
        biobased products.
            ``(2) Points of contact.--
                    ``(A) In general.--To coordinate research and 
                development programs and activities relating to 
                biobased fuels and biobased products that are carried 
                out by their respective Departments--
                            ``(i) the Secretary of Agriculture shall 
                        designate, as the point of contact for the 
                        Department of Agriculture, an officer of the 
                        Department of Agriculture appointed by the 
                        President to a position in the Department 
                        before the date of the designation, by and with 
                        the advice and consent of the Senate; and
                            ``(ii) the Secretary of Energy shall 
                        designate, as the point of contact for the 
                        Department of Energy, an officer of the 
                        Department of Energy appointed by the President 
                        to a position in the Department before the date 
                        of the designation, by and with the advice and 
                        consent of the Senate.
                    ``(B) Duties.--The points of contact shall 
                jointly--
                            ``(i) assist in arranging interlaboratory 
                        and site-specific supplemental agreements for 
                        research and development projects relating to 
                        biobased fuels and biobased products;
                            ``(ii) serve as cochairpersons of the 
                        Board;
                            ``(iii) administer the Initiative; and
                            ``(iv) respond in writing to each 
                        recommendation of the Advisory Committee made 
                        under subsection (f).
    ``(e) Biomass Research and Development Board.--
            ``(1) Establishment.--There is established the Biomass 
        Research and Development Board, which shall supersede the 
        Interagency Council on Biobased Products and Bioenergy 
        established by Executive Order No. 13134, to coordinate 
        programs within and among departments and agencies of the 
        Federal Government for the purpose of promoting the use of 
        biobased fuels and biobased products by--
                    ``(A) maximizing the benefits deriving from Federal 
                grants and assistance; and
                    ``(B) bringing coherence to Federal strategic 
                planning.
            ``(2) Membership.--The Board shall consist of--
                    ``(A) the point of contact of the Department of 
                Energy designated under subsection (d), who shall serve 
                as cochairperson of the Board;
                    ``(B) the point of contact of the Department of 
                Agriculture designated under subsection (d), who shall 
                serve as cochairperson of the Board;
                    ``(C) a senior officer of each of the Department of 
                the Interior, the Environmental Protection Agency, the 
                National Science Foundation, and the Office of Science 
                and Technology Policy, each of whom shall--
                            ``(i) be appointed by the head of the 
                        respective agency; and
                            ``(ii) have a rank that is equivalent to 
                        the rank of the points of contact; and
                    ``(D) at the option of the Secretary of Agriculture 
                and the Secretary of Energy, other members appointed by 
                the Secretaries (after consultation with the members 
                described in subparagraphs (A) through (C)).
            ``(3) Duties.--The Board shall--
                    ``(A) coordinate research and development 
                activities relating to biobased fuels and biobased 
                products--
                            ``(i) between the Department of Agriculture 
                        and the Department of Energy; and
                            ``(ii) with other departments and agencies 
                        of the Federal Government;
                    ``(B) provide recommendations to the points of 
                contact concerning administration of this title;
                    ``(C) ensure that--
                            ``(i) solicitations are open and 
                        competitive with awards made annually; and
                            ``(ii) objectives and evaluation criteria 
                        of the solicitations are clearly stated and 
                        minimally prescriptive, with no areas of 
                        special interest; and
                    ``(D) ensure that the panel of scientific and 
                technical peers assembled under subsection (g) to 
                review proposals is composed predominantly of 
                independent experts selected from outside the 
                Departments of Agriculture and Energy.
            ``(4) Funding.--Each agency represented on the Board is 
        encouraged to provide funds for any purpose under this section.
            ``(5) Meetings.--The Board shall meet at least quarterly to 
        enable the Board to carry out the duties of the Board under 
        paragraph (3).
    ``(f) Biomass Research and Development Technical Advisory 
Committee.--
            ``(1) Establishment.--There is established the Biomass 
        Research and Development Technical Advisory Committee, which 
        shall supersede the Advisory Committee on Biobased Products and 
        Bioenergy established by Executive Order No. 13134--
                    ``(A) to advise the Secretary of Energy, the 
                Secretary of Agriculture, and the points of contact 
                concerning--
                            ``(i) the technical focus and direction of 
                        requests for proposals issued under the 
                        Initiative; and
                            ``(ii) procedures for reviewing and 
                        evaluating the proposals;
                    ``(B) to facilitate consultations and partnerships 
                among Federal and State agencies, agricultural 
                producers, industry, consumers, the research community, 
                and other interested groups to carry out program 
                activities relating to the Initiative; and
                    ``(C) to evaluate and perform strategic planning on 
                program activities relating to the Initiative.
            ``(2) Membership.--
                    ``(A) In general.--The Advisory Committee shall 
                consist of--
                            ``(i) an individual affiliated with the 
                        biofuels industry;
                            ``(ii) an individual affiliated with the 
                        biobased industrial and commercial products 
                        industry;
                            ``(iii) an individual affiliated with an 
                        institution of higher education who has 
                        expertise in biobased fuels and biobased 
                        products;
                            ``(iv) two prominent engineers or 
                        scientists from government or academia who have 
                        expertise in biobased fuels and biobased 
                        products;
                            ``(v) an individual affiliated with a 
                        commodity trade association;
                            ``(vi) 2 individuals affiliated with an 
                        environmental or conservation organization;
                            ``(vii) an individual associated with State 
                        government who has expertise in biobased fuels 
                        and biobased products;
                            ``(viii) an individual with expertise in 
                        energy and environmental analysis;
                            ``(ix) an individual with expertise in the 
                        economics of biobased fuels and biobased 
                        products;
                            ``(x) an individual with expertise in 
                        agricultural economics;
                            ``(xi) an individual with expertise in 
                        agronomy, crop science, or soil science; and
                            ``(xii) at the option of the points of 
                        contact, other members.
                    ``(B) Appointment.--The members of the Advisory 
                Committee shall be appointed by the points of contact.
            ``(3) Duties.--The Advisory Committee shall--
                    ``(A) advise the points of contact with respect to 
                the Initiative; and
                    ``(B) evaluate whether, and make recommendations in 
                writing to the Board to ensure that--
                            ``(i) funds authorized for the Initiative 
                        are distributed and used in a manner that is 
                        consistent with the objectives, purposes, and 
                        considerations of the Initiative;
                            ``(ii) solicitations are open and 
                        competitive with awards made annually and that 
                        objectives and evaluation criteria of the 
                        solicitations are clearly stated and minimally 
                        prescriptive, with no areas of special 
                        interest;
                            ``(iii) the points of contact are funding 
                        proposals under this title that are selected on 
                        the basis of merit, as determined by an 
                        independent panel of scientific and technical 
                        peers predominantly from outside the 
                        Departments of Agriculture and Energy; and
                            ``(iv) activities under this section are 
                        carried out in accordance with this section.
            ``(4) Coordination.--To avoid duplication of effort, the 
        Advisory Committee shall coordinate its activities with those 
        of other Federal advisory committees working in related areas.
            ``(5) Meetings.--The Advisory Committee shall meet at least 
        quarterly to enable the Advisory Committee to carry out the 
        duties of the Advisory Committee.
            ``(6) Terms.--Members of the Advisory Committee shall be 
        appointed for a term of 3 years, except that--
                    ``(A) one-third of the members initially appointed 
                shall be appointed for a term of 1 year; and
                    ``(B) one-third of the members initially appointed 
                shall be appointed for a term of 2 years.
    ``(g) Biomass Research and Development Initiative.--
            ``(1) In general.--The Secretary of Agriculture and the 
        Secretary of Energy, acting through their respective points of 
        contact and in consultation with the Board, shall establish and 
        carry out a Biomass Research and Development Initiative under 
        which competitively awarded grants, contracts, and financial 
        assistance are provided to, or entered into with, eligible 
        entities to carry out research on, and development and 
        demonstration of, biobased fuels and biobased products, and the 
        methods, practices and technologies, for their production.
            ``(2) Objectives.--The objectives of the Initiative are to 
        develop--
                    ``(A) technologies and processes necessary for 
                abundant commercial production of biobased fuels at 
                prices competitive with fossil fuels;
                    ``(B) high-value biobased products--
                            ``(i) to enhance the economic viability of 
                        biobased fuels and power;
                            ``(ii) as substitutes for petroleum-based 
                        feedstocks and products; and
                            ``(iii) to enhance the value of coproducts 
                        arise from such technologies and processes; and
                    ``(C) a diversity of sustainable domestic sources 
                of biomass for conversion to biobased fuels and 
                biobased products.
            ``(3) Purposes.--The purposes of the Initiative are--
                    ``(A) to increase the energy security of the United 
                States;
                    ``(B) to create jobs and enhance the economic 
                development of the rural economy;
                    ``(C) to enhance the environment and public health; 
                and
                    ``(D) to diversify markets for raw agricultural and 
                forestry products.
            ``(4) Technical areas.--To advance the objectives and 
        purposes of the Initiative, the Secretary of Agriculture and 
        the Secretary of Energy, in consultation with the Administrator 
        of the Environmental Protection Agency and heads of other 
        appropriate departments and agencies (referred to in this 
        subsection as the `Secretaries'), shall direct research, 
        development, and commercial applications toward--
                    ``(A) feedstocks and feedstock systems relevant to 
                production of raw materials for conversion to biobased 
                fuels and biobased products, including--
                            ``(i) development of advanced and dedicated 
                        crops and other biomass sources with desired 
                        features, including enhanced productivity, 
                        broader site range, low requirements for 
                        chemical inputs, and enhanced processing;
                            ``(ii) advanced crop production methods to 
                        achieve the features described in clause (i);
                            ``(iii) feedstock harvest, handling, 
                        transport, and storage;
                            ``(iv) strategies for integrating feedstock 
                        production into existing managed land; and
                            ``(v) improving the value and quality of 
                        coproducts, including materials used for animal 
                        feeding;
                    ``(B) overcoming recalcitrance of cellulosic 
                biomass through developing technologies for converting 
                cellulosic biomass into intermediates that can 
                subsequently be converted into biobased fuels and 
                biobased products, including--
                            ``(i) pretreatment in combination with 
                        enzymatic or microbial hydrolysis;
                            ``(ii) thermochemical approaches, including 
                        gasification and pyrolysis; and
                            ``(iii) self-processing crops that express 
                        enzymes capable of degrading cellulosic 
                        biomass;
                    ``(C) product diversification through technologies 
                relevant to production of a range of biobased products 
                (including chemicals, animal feeds, and cogenerated 
                power) that eventually can increase the feasibility of 
                fuel production in a biorefinery, including--
                            ``(i) catalytic processing, including 
                        thermochemical fuel production;
                            ``(ii) metabolic engineering, enzyme 
                        engineering, and fermentation systems for 
                        biological production of desired products, 
                        coproducts, or cogeneration of power;
                            ``(iii) product recovery;
                            ``(iv) power production technologies;
                            ``(v) integration into existing biomass 
                        processing facilities, including starch ethanol 
                        plants, sugar processing or refining plants, 
                        paper mills, and power plants; and
                            ``(vi) enhancement of products and 
                        coproducts, including dried distillers grains 
                        (including substantially elevated starch 
                        content, increased oil content, improved fatty 
                        acid profiles, and improved resistance to mold 
                        and mycotoxins;
                    ``(D) analysis that provides strategic guidance for 
                the application of biomass technologies in accordance 
                with realization of improved sustainability and 
                environmental quality, cost effectiveness, security, 
                and rural economic development, usually featuring 
                system-wide approaches;
                    ``(E) the improvement and development of analytical 
                tools to facilitate the analysis of life-cycle energy 
                and greenhouse gas emissions, including emissions 
                related to direct and indirect land use changes, 
                attributable to all potential biofuel feedstocks and 
                production processes; and
                    ``(F) the systematic evaluation of the impact of 
                expanded biofuel production on the environment, 
                including forest lands, and on the food supply for 
                humans and animals.
            ``(5) Additional considerations.--Within the technical 
        areas described in paragraph (4), and in addition to advancing 
        the purposes described in paragraph (3) and the objectives 
        described in paragraph (2), the Secretaries shall support 
        research and development--
                    ``(A) to create continuously expanding 
                opportunities for participants in existing biofuels 
                production by seeking synergies and continuity with 
                current technologies and practices, such as 
                improvements in dried distillers grains as a bridge 
                feedstock;
                    ``(B) to maximize the environmental, economic, and 
                social benefits of production of biobased fuels and 
                biobased products on a large scale through life-cycle 
                economic and environmental analysis and other means;
                    ``(C) to assess the potential of Federal land and 
                land management programs as feedstock resources for 
                biobased fuels and biobased products, consistent with 
                the integrity of soil and water resources and with 
                other environmental considerations; and
                    ``(D) to facilitate small-scale production, local, 
                and on-farm use of biofuels, including the development 
                of small-scale gasification technologies for production 
                of biofuel from cellulosic feedstocks.
            ``(6) Eligible entities.--To be eligible for a grant, 
        contract, or assistance under this subsection, an applicant 
        shall be--
                    ``(A) an institution of higher education;
                    ``(B) a National Laboratory;
                    ``(C) a Federal research agency;
                    ``(D) a State research agency;
                    ``(E) a private sector entity;
                    ``(F) a nonprofit organization; or
                    ``(G) a consortium of two or more entities 
                described in subparagraphs (A) through (F).
            ``(7) Administration.--
                    ``(A) In general.--After consultation with the 
                Board, the points of contact shall--
                            ``(i) publish annually one or more joint 
                        requests for proposals for grants, contracts, 
                        and assistance under this subsection;
                            ``(ii) require that grants, contracts, and 
                        assistance under this section be awarded 
                        competitively, on the basis of merit, after the 
                        establishment of procedures that provide for 
                        scientific peer review by an independent panel 
                        of scientific and technical peers; and
                            ``(iii) give some preference to 
                        applications that--
                                    ``(I) involve a consortia of 
                                experts from multiple institutions;
                                    ``(II) encourage the integration of 
                                disciplines and application of the best 
                                technical resources; and
                                    ``(III) increase the geographic 
                                diversity of demonstration projects.
                    ``(B) Distribution of funding by technical area.--
                Of the funds authorized to be appropriated for 
                activities described in this subsection, funds shall be 
                distributed for each of fiscal years 2007 through 2012 
                so as to achieve an approximate distribution of--
                            ``(i) 20 percent of the funds to carry out 
                        activities for feedstock production under 
                        paragraph (4)(A);
                            ``(ii) 45 percent of the funds to carry out 
                        activities for overcoming recalcitrance of 
                        cellulosic biomass under paragraph (4)(B), of 
                        which not less than 10 percent shall be used 
                        for activities referred to in each clause of 
                        paragraph (4)(B);
                            ``(iii) 30 percent of the funds to carry 
                        out activities for product diversification 
                        under paragraph (4)(C); and
                            ``(iv) 5 percent of the funds to carry out 
                        activities for strategic guidance under 
                        paragraph (4)(D).
                    ``(C) Distribution of funding within each technical 
                area.--Within each technical area described in 
                subparagraphs (A) through (C) of paragraph (4), funds 
                shall be distributed for each of fiscal years 2007 
                through 2012 so as to achieve an approximate 
                distribution of--
                            ``(i) 15 percent of the funds for applied 
                        fundamentals;
                            ``(ii) 35 percent of the funds for 
                        innovation; and
                            ``(iii) 50 percent of the funds for 
                        demonstration and commercial applications.
                    ``(D) Matching funds.--
                            ``(i) In general.--A minimum 20 percent 
                        funding match shall be required for 
                        demonstration projects under this section.
                            ``(ii) Commercial applications.--A minimum 
                        of 50 percent funding match shall be required 
                        for commercial application projects under this 
                        section.
                    ``(E) Technology and information transfer to 
                agricultural users.--The Administrator of the 
                Cooperative State Research, Education, and Extension 
                Service and the Chief of the Natural Resources 
                Conservation Service shall ensure that applicable 
                research results and technologies from the Initiative 
                are adapted, made available, and disseminated through 
                those services, as appropriate.
    ``(h) Administrative Support and Funds.--
            ``(1) In general.--To the extent administrative support and 
        funds are not provided by other agencies under paragraph 
        (2)(b), the Secretary of Energy and the Secretary of 
        Agriculture may provide such administrative support and funds 
        of the Department of Energy and the Department of Agriculture 
        to the Board and the Advisory Committee as are necessary to 
        enable the Board and the Advisory Committee to carry out their 
        duties under this section.
            ``(2) Other agencies.--The heads of the agencies referred 
        to in subsection (e)(2)(C), and the other members appointed 
        under subsection (e)(2)(D), may, and are encouraged to, provide 
        administrative support and funds of their respective agencies 
        to the Board and the Advisory Committee.
            ``(3) Limitation.--Not more than 4 percent of the amount 
        appropriated for each fiscal year under subsection (g)(6) may 
        be used to pay the administrative costs of carrying out this 
        section.
    ``(i) Reports.--
            ``(1) Annual reports.--For each fiscal year for which funds 
        are made available to carry out this section, the Secretary of 
        Energy and the Secretary of Agriculture shall jointly submit to 
        Congress a detailed report on--
                    ``(A) the status and progress of the Initiative, 
                including a report from the Advisory Committee on 
                whether funds appropriated for the Initiative have been 
                distributed and used in a manner that--
                            ``(i) is consistent with the objectives, 
                        purposes, and additional considerations 
                        described in paragraphs (2) through (5) of 
                        subsection (g);
                            ``(ii) uses the set of criteria established 
                        in the initial report submitted under title III 
                        of the Agricultural Risk Protection Act of 
                        2000;
                            ``(iii) achieves the distribution of funds 
                        described in subparagraphs (B) and (C) of 
                        subsection (g)(7); and
                            ``(iv) takes into account any 
                        recommendations that have been made by the 
                        Advisory Committee;
                    ``(B) the general status of cooperation and 
                research and development efforts carried out at each 
                agency with respect to biobased fuels and biobased 
                products, including a report from the Advisory 
                Committee on whether the points of contact are funding 
                proposals that are selected under subsection 
                (g)(3)(B)(iii); and
                    ``(C) the plans of the Secretary of Energy and the 
                Secretary of Agriculture for addressing concerns raised 
                in the report, including concerns raised by the 
                Advisory Committee.
            ``(2) Updates.--The Secretary and the Secretary of Energy 
        shall update the Vision and Roadmap documents prepared for 
        Federal biomass research and development activities.
            ``(3) Management plan.--The Secretary shall every five 
        years, in consultation with the Secretary of Energy, submit to 
        Congress a detailed management plan for the implementation of 
        this section. The management plan shall include--
                    ``(A) consideration of the contribution of the 
                section towards achieving the objectives referred to in 
                paragraphs (2) and (3) of subsection (g) and in 
                achieving the goals of the biomass program of the 
                Department of Energy;
                    ``(B) consideration of input solicited from the 
                Advisory Committee, State, and private sources; and
                    ``(C) specific and quantifiable near and long-term 
                goals.
    ``(j) Funding.--
            ``(1) In general.--Of the funds of the Commodity Credit 
        Corporation, the Secretary of Agriculture shall make available 
        to carry out this section--
                    ``(A) $35,000,000 for fiscal year 2008;
                    ``(B) $60,000,000 for fiscal year 2009;
                    ``(C) $75,000,000 for fiscal year 2010;
                    ``(D) $100,000,000 for fiscal year 2011; and
                    ``(E) $150,000,000 for fiscal year 2012.
            ``(2) Additional funding.--In addition to amounts 
        transferred under paragraph (1), there are authorized to be 
        appropriated to carry out this section $200,000,000 for each of 
        fiscal years 2006 through 2015.''.
    (b) Repeal.--Title III of the Agricultural Risk Protection Act of 
2000 (Public Law 106-224; 7 U.S.C. 8601 et seq.) is hereby repealed.
    (c) Management Plan Submission Date.--The first management plan 
required to be submitted under section 9008(i)(3) of the Biomass 
Research and Development Act of 2000, as added by subsection (a), shall 
be submitted not later than 180 days after the date of the enactment of 
this Act.

SEC. 504. FOREST BIOENERGY RESEARCH PROGRAM.

    Title IX of the Farm Security and Rural Investment Act of 2002 (7 
U.S.C. 8101 et seq.) is further amended by adding at the end the 
following new section:

``SEC. 9013. FOREST BIOENERGY RESEARCH PROGRAM.

    ``(a) In General.--The Secretary of Agriculture, working through 
the Forest Service, in cooperation with other Federal agencies, land 
grant colleges and universities, and private entities, shall conduct a 
competitive research and development program to encourage new forest-
to-energy technologies. The Secretary may use grants, cooperative 
agreements, and other methods to partner with cooperating entities on 
projects that the Secretary determines shall best promote new forest-
to-energy technologies.
    ``(b) Priority for Project Selection.--The Secretary shall give 
priority to projects that--
            ``(1) develop technology and techniques to use low value 
        forest materials, such as byproducts of forest health 
        treatments and hazardous fuel reduction, for the production of 
        energy;
            ``(2) develop processes for the conversion of cellulosic 
        forest materials that integrate production of energy into 
        existing manufacturing steams or in integrated forest 
        biorefineries;
            ``(3) develop new transportation fuels that use forest 
        materials as a feedstock for the production of such fuels; or
            ``(4) improve the of growth and yield of trees for the 
        purpose of renewable energy and other forest product use.
    ``(c) Funding.--Of the funds of the Commodity Credit Corporation, 
the Secretary of Agriculture shall make available to carry out this 
section--
            ``(1) $4,000,000 for fiscal year 2008;
            ``(2) $6,000,000 for fiscal year 2009;
            ``(3) $7,000,000 for fiscal year 2010;
            ``(4) $9,000,000 for fiscal year 2011; and
            ``(5) $10,000,000 for fiscal year 2012.''.

SEC. 505. EARLY ACTION RENEWABLE FUEL MARKETING.

    (a) Administration.--Section 211(o)(5) of the Clean Air Act (as 
amended by by Public Law 110-140) is amended by adding the following 
new subparagraph at the end thereof:
                    ``(E) Use of early renewable fuel credits for 
                advanced biofuel.--Any person who generates credits for 
                renewable fuel that exceed it annual obligation for 
                renewable fuel and its obligation for renewable fuel 
                during the 12 month period specified in subparagraph 
                (C) may retain such credits and use the credits (on a 
                volume equivalent basis) for the purpose of complying 
                with such person's obligation under paragraph (2) with 
                respect to advanced biofuel in any future year 
                (notwithstanding the 12-month limitation referred to in 
                subparagraph (C)).''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect on January 1, 2009.

                  TITLE VI--ALTERNATIVE VEHICLE FUELS

SEC. 601. CREDIT FOR PLUG-IN HYBRID VEHICLES.

    (a) In General.--Subpart B of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to other credits), as 
amended by this Act, is amended by adding at the end the following new 
section:

``SEC. 30E. PLUG-IN HYBRID VEHICLES.

    ``(a) Allowance of Credit.--There shall be allowed as a credit 
against the tax imposed by this chapter for the taxable year an amount 
equal to the cost of any qualified plug-in hybrid vehicle placed in 
service by the taxpayer during the taxable year.
    ``(b) Limitations.--
            ``(1) Limitation per vehicle.--The amount of the credit 
        allowed under subsection (a) for any vehicle shall not exceed 
        the sum of--
                    ``(A) $4,000 in the case of a plug-in electric 
                drive vehicle with 4kWh traction battery, and
                    ``(B) $250 for each additional kWh of traction 
                battery capacity of such vehicle as exceeds 4 kWh but 
                does not exceed 50 kWh.
            ``(2) Application with other credits.--
                    ``(A) Business credit treated as part of general 
                business credit.--So much of the credit which would be 
                allowed under subsection (a) for any taxable year 
                (determined without regard to this paragraph) that is 
                attributable to property of a character subject to an 
                allowance for depreciation shall be treated as a credit 
                listed in section 38(b) for such taxable year (and not 
                allowed under subsection (a)).
                    ``(B) Personal credits.--The credit allowed by 
                subsection (a) for any taxable year shall not exceed 
                the excess (if any) of--
                            ``(i) the sum of the regular tax liability 
                        (as defined in section 26(b)) plus the tax 
                        imposed by section 55, over
                            ``(ii) the sum of the credits allowable 
                        under subpart A and subpart B (other than this 
                        section).
    ``(c) Qualified Plug-In Hybrid Vehicle.--For purposes of this 
section--
            ``(1) In general.--The term `qualified plug-in hybrid 
        vehicle' means a motor vehicle (as defined in section 
        30(c)(2))--
                    ``(A) the original use of which commences with the 
                taxpayer,
                    ``(B) which is acquired for use or lease by the 
                taxpayer and not for resale,
                    ``(C) which is made by a manufacturer,
                    ``(D) which has received a certificate of 
                conformity under the Clean Air Act, and
                    ``(E) which has not less than 2 onboard sources of 
                stored energy, different in character from each other, 
                from which to draw propulsion energy, where--
                            ``(i) at least 1 of such sources is 
                        energized by plugging into an external source 
                        of electric power, and
                            ``(ii) at least 1 of such sources is 
                        energized from an internal combustion engine, 
                        fuel cell, or other means, and such source--
                                    ``(I) is utilized to provide 
                                mechanical propulsion to the vehicle, 
                                or
                                    ``(II) is used to recharge the 
                                battery as an on-board recharging 
                                system that is used to maintain charge 
                                to the battery.
            ``(2) Exception.--The term `qualified plug-in hybrid 
        vehicle' shall not include any vehicle which is not a passenger 
        automobile or light truck if such vehicle has a gross vehicle 
        weight rating of less than 8,500 pounds.
            ``(3) Other terms.--The terms ``automobile'', ``passenger 
        automobile'', ``light truck'', and ``manufacturer'' have the 
        meanings given such terms in regulations prescribed by the 
        Administrator of the Environmental Protection Agency for 
        purposes of the administration of title II of the Clean Air Act 
        (42 U.S.C. 7521 et seq.).
            ``(4) Kwh traction battery capacity.--The term `kWh 
        traction battery capacity' means the size of an electro 
        chemical storage device, expressed in kWh, as measured from a 
        100 percent state of charge to 0 percent state of charge.
    ``(d) Special Rules.--
            ``(1) Basis reduction.--The basis of any property for which 
        a credit is allowable under subsection (a) shall be reduced by 
        the amount of such credit (determined without regard to 
        subsection (b)(2)).
            ``(2) Recapture.--The Secretary shall, by regulations, 
        provide for recapturing the benefit of any credit allowable 
        under subsection (a) with respect to any property which ceases 
        to be property eligible for such credit.
            ``(3) Property used outside united states, etc., not 
        qualified.--No credit shall be allowed under subsection (a) 
        with respect to any property referred to in section 50(b) or 
        with respect to the portion of the cost of any property taken 
        into account under section 179.
            ``(4) Denial of double benefit.--No credit shall be allowed 
        under this section with respect to a vehicle if a credit or 
        deduction is allowed with respect to such vehicle under any 
        other provision of this title.
            ``(5) Election not to take credit.--No credit shall be 
        allowed under subsection (a) for any vehicle if the taxpayer 
        elects to not have this section apply to such vehicle.
            ``(6) Property used by tax-exempt entity; interaction with 
        air quality and motor vehicle safety standards.--Rules similar 
        to the rules of paragraphs (6) and (10) of section 30B(h) shall 
        apply for purposes of this section.
    ``(e) Termination.--This section shall not apply to any property 
placed in service after December 31, 2014.''.
    (b) Plug-in Hybrid Vehicles Not Counted Toward Limitation on Number 
of New Qualified Hybrid Vehicles Eligible for 30B Credit.--Section 
30B(f)(5) of such Code (defining qualified vehicle) is amended by 
adding at the end the following new sentence: ``Such term shall not 
include a qualified plug-in hybrid vehicle (as defined in section 
30E(c)).''.
    (c) Credit Made Part of General Business Credit.--Section 38(b) of 
such Code, as amended by this Act, is amended by striking ``and'' at 
the end of paragraph (31), by striking the period at the end of 
paragraph (32) and inserting ``, plus'', and by adding at the end the 
following new paragraph:
            ``(33) the portion of the plug-in hybrid vehicle credit to 
        which section 30E(b)(2)(A) applies.''.
    (d) Conforming Amendment.--Section 6501(m) of such Code is amended 
by inserting ``30E(d)(5),'' after ``30D(e)(5),''.
    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2007.

SEC. 602. USE OF CREDITS.

    Section 312(b) of the Energy Policy Act of 1992 (42 U.S.C. 
13220(b)) is amended--
            (1) by striking ``(b) Use of Credits.--'' and all that 
        follows through ``At the request'' and inserting ``(b) Use of 
        Credits.--At the request''; and
            (2) by striking paragraph (2).

                TITLE VII--OFFSHORE OIL AND GAS LEASING

SEC. 701. TERMINATION OF PROHIBITIONS ON EXPENDITURES FOR, AND 
              WITHDRAWALS FROM, OFFSHORE LEASING.

    (a) Prohibitions on Expenditures.--All provisions of Federal law 
that prohibit the expenditure of appropriated funds to conduct oil or 
natural gas leasing and preleasing activities for any area of the Outer 
Continental Shelf shall have no force or effect with respect to such 
activities.
    (b) Revocation Withdrawals.--All withdrawals of Federal submerged 
lands of the Outer Continental Shelf from leasing, including 
withdrawals by the President under the authority of section 12(a) of 
the Outer Continental Shelf Lands Act (43 U.S.C. 1341(a)), are hereby 
revoked and are no longer in effect with respect to the leasing of 
areas for exploration for, and development and production of, oil and 
natural gas.

SEC. 702. OUTER CONTINENTAL SHELF LEASING PROGRAM.

    The Outer Continental Shelf Lands Act (43 U.S.C. 1331 et seq.) is 
amended by inserting after section 9 the following:

``SEC. 10. MORATORIA AREA AND STATE APPROVAL REQUIREMENT WITH RESPECT 
              TO OIL AND NATURAL GAS LEASING.

    ``(a) Buffer Zone.--The Secretary may not grant any oil or natural 
gas lease for any area of the outer Continental Shelf that is located 
within 25 miles of the coastline of a State.
    ``(b) State Approval Requirement.--
            ``(1) In general.--The Secretary may not issue any lease 
        authorizing exploration for, or development of, natural gas in 
        any area of the outer Continental Shelf that is located within 
        50 miles of the coastline of a State unless the State has 
        enacted a law approving of the issuance of such leases by the 
        Secretary.
            ``(2) State approval permanent.--Repeal of such a law by a 
        State shall have no effect for purposes of paragraph (1).
    ``(c) State Disapproval Authority.--
            ``(1) In general.--The Secretary may not issue any lease 
        authorizing exploration for, or development of, oil or natural 
        gas in any area of the outer Continental Shelf that is located 
        more than 50 miles and less than 100 miles from the coastline 
        of a State if the State has enacted a law disapproving of the 
        issuance of such leases by the Secretary.
            ``(2) Requirements for state law.--A law enacted by a State 
        for purposes of paragraph (1)--
                    ``(A) shall have no force or effect for purposes of 
                paragraph (1) unless first enacted by the State within 
                the one-year period beginning on the date of the 
                enactment of the National Environment and Energy 
                Development Act; and
                    ``(B) shall have no force or effect for purposes of 
                paragraph (1) after the end of the 2-year period 
                beginning on the date it first takes effect, unless the 
                State, in the 2-year period preceding the application 
                of the law for purposes of paragraph (1), enacted 
                legislation extending the effectiveness of the law.''.

SEC. 703. SHARING OF REVENUES.

    (a) In General.--Section 8(g) of the Outer Continental Shelf Lands 
Act (43 U.S.C. 1337(g)) is amended--
            (1) in paragraph (2) by striking ``Notwithstanding'' and 
        inserting ``Except as provided in paragraph (6), and 
        notwithstanding'';
            (2) by redesignating paragraphs (6) and (7) as paragraphs 
        (8) and (9); and
            (3) by inserting after paragraph (5) the following:
            ``(6) Bonus bids and royalties under qualified oil and gas 
        leases.--
                    ``(A) New oil and gas leases.--Of amounts received 
                by the United States as bonus bids and royalties under 
                any qualified oil or gas lease on submerged lands that 
                are located within the seaward boundaries of a State 
                established under section 4(a)(2)(A)--
                            ``(i) 37.5 percent shall be paid to the 
                        States that are producing States with respect 
                        to those submerged lands; and
                            ``(ii) the remainder shall be transferred 
                        to the American-Made Energy Trust Fund 
                        established by section 9511 of the Internal 
                        Revenue Code of 1986.
                    ``(B) Leased tract that lies partially within the 
                seaward boundaries of a state.--In the case of a leased 
                tract that lies partially within the seaward boundaries 
                of a State, the amounts of bonus bids and royalties 
                from such tract that are subject to subparagraph (A) 
                with respect to such State shall be a percentage of the 
                total amounts of bonus bids and royalties from such 
                tract that is equivalent to the total percentage of 
                surface acreage of the tract that lies within such 
                seaward boundaries.
                    ``(C) Use of payments to states.--Amounts paid to a 
                State under subparagraph (A)(ii) shall be used by the 
                State for one or more of the following:
                            ``(i) Education.
                            ``(ii) Transportation.
                            ``(iii) Reducing taxes.
                            ``(iv) Coastal and environmental 
                        restoration.
                            ``(v) Energy infrastructure and projects.
                            ``(vi) State seismic monitoring programs.
                            ``(vii) Alternative energy development.
                            ``(viii) Energy efficiency and 
                        conservation.
                            ``(ix) Hurricane and natural disaster 
                        insurance programs.
                            ``(x) Any other purpose determined by State 
                        law.
                    ``(D) Definitions.--In this paragraph:
                            ``(i) Adjacent state.--The term `adjacent 
                        State' means, with respect to any program, 
                        plan, lease sale, leased tract or other 
                        activity, proposed, conducted, or approved 
                        pursuant to the provisions of this Act, any 
                        State the laws of which are declared, pursuant 
                        to section 4(a)(2), to be the law of the United 
                        States for the portion of the outer Continental 
                        Shelf on which such program, plan, lease sale, 
                        leased tract, or activity appertains or is, or 
                        is proposed to be, conducted.
                            ``(ii) Adjacent zone.--The term `adjacent 
                        zone' means, with respect to any program, plan, 
                        lease sale, leased tract, or other activity, 
                        proposed, conducted, or approved pursuant to 
                        the provisions of this Act, the portion of the 
                        outer Continental Shelf for which the laws of a 
                        particular adjacent State are declared, 
                        pursuant to section 4(a)(2), to be the law of 
                        the United States.
                            ``(iii) Producing state.--The term 
                        `producing State' means an Adjacent State 
                        having an adjacent zone containing leased 
                        tracts from which are derived bonus bids and 
                        royalties under a lease under this Act.
                            ``(iv) State.--The term `State' includes 
                        Puerto Rico and the other Territories of the 
                        United States.
                            ``(v) Qualified gas lease.--The term 
                        `qualified oil or gas lease' means a lease 
                        under this Act granted after the date of the 
                        enactment of the National Environment and 
                        Energy Development Act that authorizes 
                        development and production of oil or natural 
                        gas and associated condensate.
                    ``(E) Application.--This paragraph shall apply to 
                bonus bids and royalties received by the United States 
                after September 30, 2007.
            ``(7) Maintenance of effort by states.--The Secretary of 
        the Interior shall ensure that financial assistance provided to 
        a State for any purpose with amounts made available under this 
        subsection supplement, and do not replace, the amounts expended 
        by the State for that purpose before the date of the enactment 
        of this paragraph.''.
    (b) Establishment of State Seaward Boundaries.--Section 4(a)(2)(A) 
of the Outer Continental Shelf Lands Act (43 U.S.C. 1333(a)(2)(A)) is 
amended in the first sentence by striking ``, and the President'' and 
all that follows through the end of the sentence and inserting the 
following: ``. Such extended lines are deemed to be as indicated on the 
maps for each Outer Continental Shelf region entitled `Alaska OCS 
Region State Adjacent Zone and OCS Planning Areas', `Pacific OCS Region 
State Adjacent Zones and OCS Planning Areas', `Gulf of Mexico OCS 
Region State Adjacent Zones and OCS Planning Areas', and `Atlantic OCS 
Region State Adjacent Zones and OCS Planning Areas', all of which are 
dated September 2005 and on file in the Office of the Director, 
Minerals Management Service. The preceding sentence shall not apply 
with respect to the treatment under section 105 of the Gulf of Mexico 
Energy Security Act of 2006 (title I of division C of Public Law 109-
432) of qualified outer Continental Shelf revenues deposited and 
disbursed under subsection (a)(2) of that section.''.

        TITLE VIII--INCREASING NUCLEAR GENERATED ELECTRIC ENERGY

SEC. 801. INCREASING NUCLEAR GENERATED ELECTRIC ENERGY.

    Notwithstanding any other provision of law, the President is 
authorized to take such steps as are necessary to increase the share of 
electricity generated from nuclear power to 40 percent of the total 
domestic generation by the year 2050.
                                 <all>
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