II 

110TH CONGRESS 

1ST SESSION S. 154 

To promote coal-to-liquid fuel activities. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 4, 2007 

Mr. BUNNING (for himself, Mr. OBAMA, Mr. LUGAR, Mr. PRYOR, Ms. MURKOWSKI, Mr. BOND, Mr. THOMAS, Mr. MARTINEZ, Mr. ENZI, Ms. 

LANDRIEU, and Mr. CRAIG) introduced the following bill; which was read 

twice and referred to the Committee on Energy and Natural Resources 

A BILL 

To promote coal-to-liquid fuel activities. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Coal-to-Liquid Fuel 

5 Energy Act of 2007’’. 

6 SEC. 2. DEFINITIONS. 

7 In this Act: 

8 (1) COAL-TO-LIQUID.—The term ‘‘coal-to-liq9 uid’’ means— 

10 (A) with respect to a process or tech11 nology, the use of a feedstock, the majority of 


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1 which is the coal resources of the United 

2 States, using the class of reactions known as 

3 Fischer-Tropsch, to produce synthetic fuel suit4 able for transportation; and 

5 (B) with respect to a facility, the portion 

6 of a facility related to producing the inputs to 

7 the Fischer-Tropsch process, the Fischer8 Tropsch process, finished fuel production, or 

9 the capture, transportation, or sequestration of 

10 byproducts of the use of a feedstock that is pri11 marily domestic coal at the Fischer-Tropsch fa12 cility, including carbon emissions. 

13 (2) SECRETARY.—The term ‘‘Secretary’’ means 

14 the Secretary of Energy. 

15 SEC. 3. COAL-TO-LIQUID FUEL LOAN GUARANTEE PRO16 GRAM. 

17 (a) ELIGIBLE PROJECTS.—Section 1703(b) of the 

18 Energy Policy Act of 2005 (42 U.S.C. 16513(b)) is 

19 amended by adding at the end the following: 

20 ‘‘(11) Large-scale coal-to-liquid facilities (as de21 fined in section 2 of the Coal-to-Liquid Fuel Energy 

22 Act of 2007) that use a feedstock, the majority of 

23 which is the coal resources of the United States, to 

24 produce not less than 10,000 barrels a day of liquid 

25 transportation fuel.’’. 


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1 (b) AUTHORIZATION OF APPROPRIATIONS.—Section 

2 1704 of the Energy Policy Act of 2005 (42 U.S.C. 16514) 

3 is amended by adding at the end the following: 

4 ‘‘(c) COAL-TO-LIQUID PROJECTS.— 

5 ‘‘(1) IN GENERAL.—There are authorized to be 

6 appropriated such sums as are necessary to provide 

7 the cost of guarantees for projects involving large8 scale coal-to-liquid facilities under section 

9 1703(b)(11). 

10 ‘‘(2) ALTERNATIVE FUNDING.—If no appropria11 tions are made available under paragraph (1), an eli12 gible applicant may elect to provide payment to the 

13 Secretary, to be delivered if and at the time the ap14 plication is approved, in the amount of the estimated 

15 cost of the loan guarantee to the Federal Govern16 ment, as determined by the Secretary. 

17 ‘‘(3) LIMITATIONS.— 

18 ‘‘(A) IN GENERAL.—No loan guarantees 

19 shall be provided under this title for projects 

20 described in paragraph (1) after (as determined 

21 by the Secretary)— 

22 ‘‘(i) the tenth such loan guarantee is 

23 issued under this title; or 


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1 ‘‘(ii) production capacity covered by 

2 such loan guarantees reaches 100,000 bar3 rels per day of coal-to-liquid fuel. 

4 ‘‘(B) INDIVIDUAL PROJECTS.— 

5 ‘‘(i) IN GENERAL.—A loan guarantee 

6 may be provided under this title for any 

7 large-scale coal-to-liquid facility described 

8 in paragraph (1) that produces no more 

9 than 20,000 barrels of coal-to-liquid fuel 

10 per day. 

11 ‘‘(ii) NON-FEDERAL FUNDING RE12 QUIREMENT.—To be eligible for a loan 

13 guarantee under this title, a large-scale 

14 coal-to-liquid facility described in para15 graph (1) that produces more than 20,000 

16 barrels per day of coal-to-liquid fuel shall 

17 be eligible to receive a loan guarantee for 

18 the proportion of the cost of the facility 

19 that represents 20,000 barrels of coal-to20 liquid fuel per day of production. 

21 ‘‘(4) REQUIREMENTS.— 

22 ‘‘(A) GUIDELINES.—Not later than 180 

23 days after the date of enactment of this sub24 section, the Secretary shall publish guidelines 


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1 for the coal-to-liquids loan guarantee applica2 tion process. 

3 ‘‘(B) APPLICATIONS.—Not later than 1 

4 year after the date of enactment of this sub5 section, the Secretary shall begin to accept ap6 plications for coal-to-liquid loan guarantees 

7 under this subsection. 

8 ‘‘(C) DEADLINE.—Not later than 1 year 

9 from the date of acceptance of an application 

10 under subparagraph (B), the Secretary shall 

11 evaluate the application and make final deter12 minations under this subsection. 

13 ‘‘(5) REPORTS TO CONGRESS.—The Secretary 

14 shall submit to the Committee on Energy and Nat15 ural Resources of the Senate and the Committee on 

16 Energy and Commerce of the House of Representa17 tives a report describing the status of the program 

18 under this subsection not later than each of— 

19 ‘‘(A) 180 days after the date of enactment 

20 of this subsection; 

21 ‘‘(B) 1 year after the date of enactment of 

22 this subsection; and 

23 ‘‘(C) the dates on which the Secretary ap24 proves the first and fifth applications for coalVerDate Aug 31 2005 01:21 Jan 09, 2007 Jkt 059200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S154.IS S154

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1 to-liquid loan guarantees under this sub2 section.’’. 

3 SEC. 4. COAL-TO-LIQUID FACILITIES LOAN PROGRAM. 

4 (a) DEFINITION OF ELIGIBLE RECIPIENT.—In this 

5 section, the term ‘‘eligible recipient’’ means an individual, 

6 organization, or other entity that owns, operates, or plans 

7 to construct a coal-to-liquid facility that will produce at 

8 least 10,000 barrels per day of coal-to-liquid fuel. 

9 (b) ESTABLISHMENT.—The Secretary shall establish 

10 a program under which the Secretary shall provide loans, 

11 in a total amount not to exceed $20,000,000, for use by 

12 eligible recipients to pay the Federal share of the cost of 

13 obtaining any services necessary for the planning, permit14 ting, and construction of a coal-to-liquid facility. 

15 (c) APPLICATION.—To be eligible to receive a loan 

16 under subsection (b), the eligible recipient shall submit to 

17 the Secretary an application at such time, in such manner, 

18 and containing such information as the Secretary may re19 quire. 

20 (d) NON-FEDERAL MATCH.—To be eligible to receive 

21 a loan under this section, an eligible recipient shall use 

22 non-Federal funds to provide a dollar-for-dollar match of 

23 the amount of the loan. 

24 (e) REPAYMENT OF LOAN.— 


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1 (1) IN GENERAL.—To be eligible to receive a 

2 loan under this section, an eligible recipient shall 

3 agree to repay the original amount of the loan to the 

4 Secretary not later than 5 years after the date of the 

5 receipt of the loan. 

6 (2) SOURCE OF FUNDS.—Repayment of a loan 

7 under paragraph (1) may be made from any financ8 ing or assistance received for the construction of a 

9 coal-to-liquid facility described in subsection (a), in10 cluding a loan guarantee provided under section 

11 1703(b)(11) of the Energy Policy Act of 2005 (42 

12 U.S.C. 16513(b)(11)). 

13 (f) REQUIREMENTS.— 

14 (1) GUIDELINES.—Not later than 180 days 

15 after the date of enactment of this Act, the Sec16 retary shall publish guidelines for the coal-to-liquids 

17 loan application process. 

18 (2) APPLICATIONS.—Not later than 1 year 

19 after the date of enactment of this Act, the Sec20 retary shall begin to accept applications for coal-to21 liquid loans under this section. 

22 (g) REPORTS TO CONGRESS.—Not later than each of 

23 180 days and 1 year after the date of enactment of this 

24 Act, the Secretary shall submit to the Committee on En25 ergy and Natural Resources of the Senate and the ComVerDate Aug 31 2005 01:21 Jan 09, 2007 Jkt 059200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S154.IS S154

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1 mittee on Energy and Commerce of the House of Rep2 resentatives a report describing the status of the program 

3 under this section. 

4 (h) AUTHORIZATION OF APPROPRIATIONS.—There is 

5 authorized to be appropriated to carry out this section 

6 $200,000,000, to remain available until expended. 

7 SEC. 5. LOCATION OF COAL-TO-LIQUID MANUFACTURING 

8 FACILITIES. 

9 The Secretary, in coordination with the head of any 

10 affected agency, shall promulgate such regulations as the 

11 Secretary determines to be necessary to support the devel12 opment on Federal land (including land of the Department 

13 of Energy, military bases, and military installations closed 

14 or realigned under the defense base closure and realign15 ment) of coal-to-liquid manufacturing facilities and associ16 ated infrastructure, including the capture, transportation, 

17 or sequestration of carbon dioxide. 

18 SEC. 6. STRATEGIC PETROLEUM RESERVE. 

19 (a) DEVELOPMENT, OPERATION, AND MAINTENANCE

20 OF RESERVE.—Section 159 of the Energy Policy and Con21 servation Act (42 U.S.C. 6239) is amended— 

22 (1) by redesignating subsections (f), (g), (j), 

23 (k), and (l) as subsections (a), (b), (e), (f), and (g), 

24 respectively; and 


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1 (2) by inserting after subsection (b) (as redesig2 nated by paragraph (1)) the following: 

3 ‘‘(c) STUDY OF MAINTAINING COAL-TO-LIQUID

4 PRODUCTS IN RESERVE.—Not later than 1 year after the 

5 date of enactment of the Coal-to-Liquid Fuel Energy Act 

6 of 2007, the Secretary and the Secretary of Defense 

7 shall— 

8 ‘‘(1) conduct a study of the feasibility and suit9 ability of maintaining coal-to-liquid products in the 

10 Reserve; and 

11 ‘‘(2) submit to the Committee on Energy and 

12 Natural Resources and the Committee on Armed 

13 Services of the Senate and the Committee on Energy 

14 and Commerce and the Committee on Armed Serv15 ices of the House of Representatives a report de16 scribing the results of the study. 

17 ‘‘(d) CONSTRUCTION OF STORAGE FACILITIES.—As 

18 soon as practicable after the date of enactment of the 

19 Coal-to-Liquid Fuel Energy Act of 2007, the Secretary 

20 may construct 1 or more storage facilities in the vicinity 

21 of pipeline infrastructure and at least 1 military base.’’. 

22 (b) PETROLEUM PRODUCTS FOR STORAGE IN RE23 SERVE.—Section 160 of the Energy Policy and Conserva24 tion Act (42 U.S.C. 6240) is amended— 

25 (1) in subsection (a)— 


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1 (A) in paragraph (1), by inserting a semi2 colon at the end; 

3 (B) in paragraph (2), by striking ‘‘and’’ at 

4 the end; 

5 (C) in paragraph (3), by striking the pe6 riod at the end and inserting ‘‘; and’’; and 

7 (D) by adding at the end the following: 

8 ‘‘(4) coal-to-liquid products (as defined in sec9 tion 2 of the Coal-to-Liquid Fuel Energy Act of 

10 2007), as the Secretary determines to be appro11 priate, in a quantity not to exceed 20 percent of the 

12 total quantity of petroleum and petroleum products 

13 in the Reserve.’’; 

14 (2) in subsection (b), by redesignating para15 graphs (3) through (5) as paragraphs (2) through 

16 (4), respectively; and 

17 (3) by redesignating subsections (f) and (h) as 

18 subsections (d) and (e), respectively. 

19 (c) CONFORMING AMENDMENTS.—Section 167 of the 

20 Energy Policy and Conservation Act (42 U.S.C. 6247) is 

21 amended— 

22 (1) in subsection (b)— 

23 (A) by redesignating paragraphs (2) and 

24 (3) as paragraphs (1) and (2), respectively; and 


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1 (B) in paragraph (2) (as redesignated by 

2 subparagraph (A)), by striking ‘‘section 160(f)’’ 

3 and inserting ‘‘section 160(e)’’; and 

4 (2) in subsection (d), in the matter preceding 

5 paragraph (1), by striking ‘‘section 160(f)’’ and in6 serting ‘‘section 160(e)’’. 

7 SEC. 7. AUTHORIZATION TO CONDUCT RESEARCH, DEVEL8 OPMENT, TESTING, AND EVALUATION OF AS9 SURED DOMESTIC FUELS. 

10 Of the amount authorized to be appropriated for the 

11 Air Force for research, development, testing, and evalua12 tion, $10,000,000 may be made available for the Air Force 

13 Research Laboratory to continue support efforts to test, 

14 qualify, and procure synthetic fuels developed from coal 

15 for aviation jet use. 

16 SEC. 8. COAL-TO-LIQUID LONG-TERM FUEL PROCUREMENT 

17 AND DEPARTMENT OF DEFENSE DEVELOP18 MENT. 

19 Section 2398a of title 10, United States Code is 

20 amended— 

21 (1) in subsection (b)— 

22 (A) by striking ‘‘The Secretary’’ and in23 serting the following: 

24 ‘‘(1) IN GENERAL.—The Secretary’’; and 

25 (B) by adding at the end the following: 


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1 ‘‘(2) COAL-TO-LIQUID PRODUCTION FACILI2 TIES.— 

3 ‘‘(A) IN GENERAL.—The Secretary of De4 fense may enter into contracts or other agree5 ments with private companies or other entities 

6 to develop and operate coal-to-liquid facilities 

7 (as defined in section 2 of the Coal-to-Liquid 

8 Fuel Energy Act of 2007) on or near military 

9 installations. 

10 ‘‘(B) CONSIDERATIONS.—In entering into 

11 contracts and other agreements under subpara12 graph (A), the Secretary shall consider land 

13 availability, testing opportunities, and proximity 

14 to raw materials.’’; 

15 (2) in subsection (d)— 

16 (A) by striking ‘‘Subject to applicable pro17 visions of law, any’’ and inserting ‘‘Any’’; and 

18 (B) by striking ‘‘1 or more years’’ and in19 serting ‘‘up to 25 years’’; and 

20 (3) by adding at the end the following: 

21 ‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There 

22 are authorized to be appropriated such sums as are nec23 essary to carry out this section.’’. 


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1 SEC. 9. REPORT ON EMISSIONS OF FISCHER-TROPSCH 

2 PRODUCTS USED AS TRANSPORTATION 

3 FUELS. 

4 (a) IN GENERAL.—In cooperation with the Adminis5 trator of the Environmental Protection Agency, the Sec6 retary of Defense, the Administrator of the Federal Avia7 tion Administration, and the Secretary of Health and 

8 Human Services, the Secretary shall— 

9 (1) carry out a research and demonstration pro10 gram to evaluate the emissions of the use of Fischer11 Tropsch fuel for transportation, including diesel and 

12 jet fuel; 

13 (2) evaluate the effect of using Fischer-Tropsch 

14 transportation fuel on land and air engine exhaust 

15 emissions; and 

16 (3) in accordance with subsection (e), submit to 

17 Congress a report on the effect on air quality and 

18 public health of using Fischer-Tropsch fuel in the 

19 transportation sector. 

20 (b) GUIDANCE AND TECHNICAL SUPPORT.—The Sec21 retary shall issue any guidance or technical support docu22 ments necessary to facilitate the effective use of Fischer23 Tropsch fuel and blends under this section. 

24 (c) FACILITIES.—For the purpose of evaluating the 

25 emissions of Fischer-Tropsch transportation fuels, the 

26 Secretary shall— 


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1 (1) support the use and capital modification of 

2 existing facilities and the construction of new facili3 ties at the research centers designated in section 

4 417 of the Energy Policy Act of 2005 (42 U.S.C. 

5 15977); and 

6 (2) engage those research centers in the evalua7 tion and preparation of the report required under 

8 subsection (a)(3). 

9 (d) REQUIREMENTS.—The program described in sub10 section (a)(1) shall consider— 

11 (1) the use of neat (100 percent) Fischer12 Tropsch fuel and blends of Fischer-Tropsch fuels 

13 with conventional crude oil-derived fuel for heavy14 duty and light-duty diesel engines and the aviation 

15 sector; and 

16 (2) the production costs associated with domes17 tic production of those fuels and prices for con18 sumers. 

19 (e) REPORTS.—The Secretary shall submit to the 

20 Committee on Energy and Natural Resources of the Sen21 ate and the Committee on Energy and Commerce of the 

22 House of Representatives— 

23 (1) not later than 180 days after the date of 

24 enactment of this Act, an interim report on actions 

25 taken to carry out this section; and 


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1 (2) not later than 1 year after the date of en2 actment of this Act, a final report on actions taken 

3 to carry out this section. 

4 (f) AUTHORIZATION OF APPROPRIATIONS.—There 

5 are authorized to be appropriated such sums as are nec6 essary to carry out this section. 

Æ 


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