I 

110TH CONGRESS 

1ST SESSION H. R. 1596 

To amend the Internal Revenue Code of 1986 to provide and extend tax 

incentives for renewable energy and conservation. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 20, 2007 

Mr. FERGUSON (for himself, Mr. KUHL of New York, Mr. REICHERT, Mr. 

BURTON of Indiana, and Ms. GINNY BROWN-WAITE of Florida) introduced the following bill; which was referred to the Committee on Ways 

and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to provide 

and extend tax incentives for renewable energy and conservation. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Clean and Green Re5 newable Energy Tax Credit Act of 2007’’. 

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1 SEC. 2. EXTENSION AND MODIFICATION OF INVESTMENT 

2 TAX CREDIT WITH RESPECT TO SOLAR EN3 ERGY PROPERTY AND QUALIFIED FUEL CELL 

4 PROPERTY. 

5 (a) SOLAR ENERGY PROPERTY.—Paragraphs 

6 (2)(A)(i)(II) and (3)(A)(ii) of section 48(a) of the Internal 

7 Revenue Code of 1986 are each amended by striking 

8 ‘‘2009’’ and inserting ‘‘2031’’. 

9 (b) ELIGIBLE FUEL CELL PROPERTY.—Paragraph 

10 (1)(E) of section 48(c) of such Code is amended by strik11 ing ‘‘2008’’ and inserting ‘‘2030’’. 

12 (c) MODIFICATION OF ENERGY PERCENTAGE.— 

13 (1) IN GENERAL.—Clause (i) of section 

14 48(a)(2)(A) of such Code is amended by striking 

15 ‘‘30 percent’’ and inserting ‘‘the applicable percent16 age’’. 

17 (2) APPLICABLE PERCENTAGE.—Paragraph (2) 

18 of section 48(a) of such Code is amended by adding 

19 at the end the following new subparagraph: 

20 ‘‘(C) APPLICABLE PERCENTAGE.—For 

21 purposes of this paragraph, the term ‘applicable 

22 percentage’ means— 

23 ‘‘(i) 30 percent in the case of any tax24 able year beginning after December 31, 

25 2006, and before January 1, 2016, 

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1 ‘‘(ii) 25 percent in the case of any 

2 taxable year beginning after December 31, 

3 2015, and before January 1, 2022, and 

4 ‘‘(iii) 20 percent in the case of any 

5 taxable year beginning after December 31, 

6 2021.’’. 

7 (d) ENERGY PROPERTY TO INCLUDE EXCESS EN8 ERGY STORAGE DEVICE.—Clause (i) of section 

9 48(a)(3)(A) of such Code is amended to read as follows: 

10 ‘‘(i) equipment which uses solar en11 ergy to generate electricity, to heat or cool 

12 (or provide hot water for use in) a struc13 ture, or to provide solar process heat, or 

14 advanced energy storage systems installed 

15 as an integrated component of the fore16 going, excepting property used to generate 

17 energy for purposes of heating a swimming 

18 pool,’’. 

19 (e) SOLAR LIGHTING EQUIPMENT TO INCLUDE

20 SOLAR HYBRID LIGHTING SYSTEMS.—Clause (ii) of sec21 tion 48(a)(3)(A) of such Code is amended to read as fol22 lows: 

23 ‘‘(ii) equipment which uses solar en24 ergy to illuminate the inside of a structure 

25 using fiber-optic distributed sunlight but 

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1 only with respect to periods ending before 

2 January 1, 2031,’’. 

3 (f) MODIFICATIONS.— 

4 (1) SOLAR PHOTOVOLTAIC ENERGY PROPERTY

5 CREDIT DETERMINED SOLELY BY KILOWATT CAPAC6 ITY.— 

7 (A) IN GENERAL.—Subsection (a) of sec8 tion 48 of such Code is amended by redesig9 nating paragraph (4) as paragraph (5) and by 

10 inserting after paragraph (3) the following new 

11 paragraph: 

12 ‘‘(4) SPECIAL RULE FOR ENERGY CREDIT FOR

13 SOLAR PHOTOVOLTAIC ENERGY PROPERTY.— 

14 ‘‘(A) IN GENERAL.—For purposes of sec15 tion 46, the energy credit for any taxable year 

16 for solar photovoltaic energy property described 

17 in paragraph (3)(A)(i) which is used to gen18 erate electricity and which is placed in service 

19 during the taxable year is $1,500 with respect 

20 to each half kilowatt of capacity of such prop21 erty. Paragraph (2)(A)(ii) shall not apply to 

22 property to which the preceding sentence ap23 plies. 

24 ‘‘(B) APPLICATION OF SPECIAL RULES FOR

25 REHABILITATED OR SUBSIDIZED PROPERTY.— 

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1 Rules similar to the rules of paragraphs (2)(B) 

2 and (5) shall apply to property to which this 

3 paragraph applies.’’. 

4 (B) CONFORMING AMENDMENT.—Sub5 clause (II) of section 48(a)(2)(A)(i) of such 

6 Code is amended by striking ‘‘described in 

7 paragraph (3)(A)(i)’’ and inserting ‘‘which is 

8 described in paragraph (3)(A)(i) and to which 

9 paragraph (4) does not apply’’. 

10 (g) CREDIT ALLOWED AGAINST THE ALTERNATIVE

11 MINIMUM TAX.—Section 38(c)(4)(B) of such Code (defin12 ing specified credits) is amended by striking the period 

13 at the end of clause (ii)(II) and inserting ‘‘, and’’, and 

14 by adding at the end the following new clause: 

15 ‘‘(iii) the portion of the investment 

16 credit which is attributable to the energy 

17 credit determined under section 48.’’. 

18 (h) EFFECTIVE DATES.—The amendments made by 

19 this section shall apply to property placed in service in 

20 taxable years beginning after December 31, 2006. 

21 SEC. 3. EXTENSION AND MODIFICATION OF CREDIT FOR 

22 RESIDENTIAL ENERGY EFFICIENT PROP23 ERTY. 

24 (a) EXTENSION.—Subsection (g) of section 25D of 

25 the Internal Revenue Code of 1986 (relating to termimstockstill on PROD1PC66 with BILLS

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1 nation) is amended by striking ‘‘2009’’ and inserting 

2 ‘‘2016’’. 

3 (b) SOLAR ELECTRIC PROPERTY.—Paragraph (1) of 

4 section 25D(a) of such Code (relating to allowance of cred5 it) is amended by striking ‘‘30 percent of’’. 

6 (c) MODIFICATION OF MAXIMUM CREDIT.—Subpara7 graph (A) of section 25D(b)(1) of such Code is amended 

8 to read as follows: 

9 ‘‘(A) $1,500 with respect to each half kilo10 watt of installed capacity of property described 

11 in subsection (d)(2) for which qualified solar 

12 electric property expenditures are made,’’. 

13 (d) DEFINITION OF QUALIFIED SOLAR WATER

14 HEATING PROPERTY EXPENDITURE.—Paragraph (1) of 

15 section 25D(d) of such Code is amended by striking ‘‘to 

16 heat water for use in’’ and inserting ‘‘to heat or cool (or 

17 provide hot water for use in)’’. 

18 (e) DEFINITION OF QUALIFIED PHOTOVOLTAIC

19 PROPERTY EXPENDITURE.—Paragraph (2) of section 

20 25D(d) of such Code is amended by inserting ‘‘, including 

21 advanced energy storage systems installed as an inte22 grated component of the foregoing’’ after ‘‘taxpayer’’. 

23 (f) CREDIT ALLOWED AGAINST ALTERNATIVE MIN24 IMUM TAX.— 

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1 (1) IN GENERAL.—Section 25D(b) of such Code 

2 (as amended by subsection (b)) is amended by add3 ing at the end the following new paragraph: 

4 ‘‘(3) CREDIT ALLOWED AGAINST ALTERNATIVE

5 MINIMUM TAX.—The credit allowed under subsection 

6 (a) for the taxable year shall not exceed the excess 

7 of— 

8 ‘‘(A) the sum of the regular tax liability 

9 (as defined in section 26(b)) plus the tax im10 posed by section 55, over 

11 ‘‘(B) the sum of the credits allowable 

12 under subpart A of part IV of subchapter A 

13 (other than this section) and section 27 for the 

14 taxable year.’’. 

15 (2) CONFORMING AMENDMENTS.— 

16 (A) Subsection (c) of section 25D of such 

17 Code is amended to read as follows: 

18 ‘‘(c) CARRYFORWARD OF UNUSED CREDIT.—If the 

19 credit allowable under subsection (a) for any taxable year 

20 exceeds the limitation imposed by subsection (b)(3) for 

21 such taxable year, such excess shall be carried to the suc22 ceeding taxable year and added to the credit allowable 

23 under subsection (a) for such succeeding taxable year.’’. 

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1 (B) Section 23(b)(4)(B) of such Code is 

2 amended by inserting ‘‘and section 25D’’ after 

3 ‘‘this section’’. 

4 (C) Section 24(b)(3)(B) of such Code is 

5 amended by striking ‘‘sections 23 and 25B’’ 

6 and inserting ‘‘sections 23, 25B, and 25D’’. 

7 (D) Section 26(a)(1) of such Code is 

8 amended by striking ‘‘and 25B’’ and inserting 

9 ‘‘25B, and 25D’’. 

10 (g) EFFECTIVE DATE.—The amendments made by 

11 this section shall apply to expenditures made in taxable 

12 years beginning after December 31, 2006. 

13 SEC. 4. 3-YEAR ACCELERATED DEPRECIATION PERIOD FOR 

14 SOLAR ENERGY PROPERTY AND FUEL CELL 

15 PROPERTY. 

16 (a) IN GENERAL.—Subparagraph (A) of section 

17 168(e)(3) of the Internal Revenue Code of 1986 is amend18 ed by striking ‘‘and’’ at the end of clause (ii), by striking 

19 the period at the end of clause (iii) and inserting a comma, 

20 and by inserting after clause (iii) the following new clause: 

21 ‘‘(iv) any property which is described 

22 in clause (i) or (ii) of section 48(a)(3)(A) 

23 (or would be so described if the last sen24 tence of such section did not apply to such 

25 clause), and 

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1 ‘‘(v) any property which is described 

2 in clause (iv) of section 48(a)(3)(A).’’. 

3 (b) CONFORMING AMENDMENT.—Section 

4 168(e)(3)(B)(vi)(I) of such Code is amended to read as 

5 follows: 

6 ‘‘(I) would be described in sub7 paragraph (A) of section 48(a)(3) if 

8 ‘wind energy’ were substituted for 

9 ‘solar energy’ in clause (i) thereof and 

10 the last sentence of such section did 

11 not apply to such subparagraph,’’. 

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

13 this section shall apply to property placed in service after 

14 December 31, 2006. 

15 SEC. 5. 5-YEAR EXTENSION OF CREDIT FOR ELECTRICITY 

16 PRODUCED FROM CERTAIN RENEWABLE RE17 SOURCES. 

18 Section 45(d) of the Internal Revenue Code of 1986 

19 (relating to qualified facilities) is amended by striking 

20 ‘‘2009’’ each place it appears and inserting ‘‘2014’’. 

21 SEC. 6. INVESTMENT CREDIT FOR SMALL WIND SYSTEMS. 

22 (a) ENERGY CREDIT FOR BUSINESSES.— 

23 (1) IN GENERAL.—Subparagraph (A) of section 

24 48(a)(3) of the Internal Revenue Code of 1986 (re25 lating to energy property) is amended by striking 

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1 ‘‘or’’ at the end of clause (iii), by inserting ‘‘or’’ at 

2 the end of clause (iv), and by adding at the end the 

3 following new clause: 

4 ‘‘(v) equipment which uses wind to 

5 generate electricity if such equipment is 

6 rated at 100 kW or less,’’. 

7 (2) 30 PERCENT CREDIT.—Clause (i) of section 

8 48(a)(2)(A) of such Code is amended by striking 

9 ‘‘and’’ at the end of subclause (II) and by inserting 

10 after subclause (III) the following new subclause: 

11 ‘‘(IV) energy property described 

12 in paragraph (3)(A)(v), and’’. 

13 (b) RESIDENTIAL ENERGY EFFICIENT PROPERTY

14 CREDIT FOR INDIVIDUALS.— 

15 (1) IN GENERAL.—Subsection (a) of section 

16 25D of such Code is amended by striking ‘‘and’’ at 

17 the end of paragraph (2), by striking the period at 

18 the end of paragraph (3) and inserting ‘‘, and’’, and 

19 by adding at the end the following new paragraph: 

20 ‘‘(4) 30 percent of the qualified small wind sys21 tem expenditures made by the taxpayer during the 

22 taxable year.’’. 

23 (2) MAXIMUM CREDIT.—Paragraph (1) of sec24 tion 25D(b) of such Code is amended by striking 

25 ‘‘and’’ at the end of paragraph (2), by striking the 

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1 period at the end of paragraph (3) and inserting ‘‘, 

2 and’’, and by adding at the end the following new 

3 paragraph: 

4 ‘‘(4) $1,500 with respect to each half kilowatt 

5 of installed capacity of equipment described in sub6 section (d)(4) for which qualified small wind system 

7 expenditures are made,’’. 

8 (3) QUALIFIED SMALL WIND SYSTEM EXPENDI9 TURES.—Subsection (d) of section 25D of such Code 

10 is amended by adding at the end the following new 

11 paragraph: 

12 ‘‘(4) QUALIFIED SMALL WIND SYSTEM EXPEND13 ITURES.—The term ‘qualified small wind system ex14 penditures’ means an expenditure for equipment 

15 which uses wind to generate electricity for use in a 

16 dwelling unit located in the United States and used 

17 as a residence by the taxpayers if such equipment is 

18 rated at 100 kW or less.’’. 

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

20 this section shall apply to property placed in service after 

21 December 31, 2006. 

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1 SEC. 7. EXTENSION OF CREDIT FOR NONBUSINESS ENERGY 

2 PROPERTY. 

3 Subsection (g) of section 25C of the Internal Revenue 

4 Code of 1986 is amended by striking ‘‘December 31, 

5 2007’’ and inserting ‘‘December 31, 2009’’. 

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