I 

111TH CONGRESS 

1ST SESSION H. R. 2998 

To create clean energy jobs, achieve energy independence, reduce global 

warming pollution and transition to a clean energy economy. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 23, 2009 

Mr. WAXMAN (for himself and Mr. MARKEY of Massachusetts) introduced the 

following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committees on Foreign Affairs, Ways and 

Means, Financial Services, Education and Labor, Science and Technology, Transportation and Infrastructure, Natural Resources, Agriculture, Oversight and Government Reform, and the Judiciary, 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 create clean energy jobs, achieve energy independence, 

reduce global warming pollution and transition to a clean 

energy economy. 


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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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘American Clean Energy and Security Act of 2009’’. 

6 (b) TABLE OF CONTENTS.—The table of contents for 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Definitions. 

Sec. 3. International participation. 

TITLE I—CLEAN ENERGY 

Subtitle A—Combined Efficiency and Renewable Electricity Standard 

Sec. 101. Combined efficiency and renewable electricity standard. 

Sec. 102. Clarifying State authority to adopt renewable energy incentives. 

Subtitle B—Carbon Capture and Sequestration 

Sec. 111. National strategy. 

Sec. 112. Regulations for geologic sequestration sites. 

‘‘Sec. 813. Geologic sequestration sites. 

Sec. 113. Studies and reports. 

Sec. 114. Carbon capture and sequestration demonstration and early deployment program. 

Sec. 115. Commercial deployment of carbon capture and sequestration technologies. 

‘‘Sec. 786. Commercial deployment of carbon capture and sequestration 

technologies. 

Sec. 116. Performance standards for coal-fueled power plants. 

‘‘Sec. 812. Performance standards for new coal-fired power plants. 

Subtitle C—Clean Transportation 

Sec. 121. Electric vehicle infrastructure. 

Sec. 122. Large-scale vehicle electrification program. 

Sec. 123. Plug-in electric drive vehicle manufacturing. 

Sec. 124. Investment in clean vehicles. 

Sec. 125. Advanced technology vehicle manufacturing incentive loans. 

Sec. 126. Amendment to renewable fuels standard. 

Sec. 127. Open fuel standard. 

Sec. 128. Diesel emissions reduction. 

Sec. 129. Loan guarantees for projects to construct renewable fuel pipelines. 

Subtitle D—State Energy and Environment Development Accounts 

Sec. 131. Establishment of SEED Accounts. 

Sec. 132. Support of State renewable energy and energy efficiency programs. 


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Sec. 133. Support of Indian renewable energy and energy efficiency programs. 

Subtitle E—Smart Grid Advancement 

Sec. 141. Definitions. 

Sec. 142. Assessment of Smart Grid cost effectiveness in products. 

Sec. 143. Inclusions of Smart Grid capability on appliance ENERGY GUIDE 

labels. 

Sec. 144. Smart Grid peak demand reduction goals. 

Sec. 145. Reauthorization of energy efficiency public information program to 

include Smart Grid information. 

Sec. 146. Inclusion of Smart Grid features in appliance rebate program. 

Subtitle F—Transmission Planning 

Sec. 151. Transmission planning. 

Sec. 152. Net metering for Federal agencies. 

Sec. 153. Support for qualified advanced electric transmission manufacturing 

plants, qualified high efficiency transmission property, and 

qualified advanced electric transmission property. 

Subtitle G—Technical Corrections to Energy Laws 

Sec. 161. Technical corrections to Energy Independence and Security Act of 

2007. 

Sec. 162. Technical corrections to Energy Policy Act of 2005. 

Subtitle H—Energy and Efficiency Centers and Research 

Sec. 171. Energy Innovation Hubs. 

Sec. 172. Advanced energy research. 

Sec. 173. Building Assessment Centers. 

Sec. 174. Centers for Energy and Environmental Knowledge and Outreach. 

Subtitle I—Nuclear and Advanced Technologies 

Sec. 181. Revisions to loan guarantee program authority. 

Sec. 182. Purpose. 

Sec. 183. Definitions. 

Sec. 184. Clean energy investment fund. 

Sec. 185. Energy technology deployment goals. 

Sec. 186. Clean energy deployment administration. 

Sec. 187. Direct support. 

Sec. 188. Indirect support. 

Sec. 189. Federal credit authority. 

Sec. 190. General provisions. 

Sec. 191. Conforming amendments. 

Subtitle J—Miscellaneous 

Sec. 195. Increased hydroelectric generation at existing Federal facilities. 

Sec. 196. Clean technology business competition grant program. 

Sec. 197. National Bioenergy Partnership. 

Sec. 198. Office of Consumer Advocacy. 

TITLE II—ENERGY EFFICIENCY 

Subtitle A—Building Energy Efficiency Programs 


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Sec. 201. Greater energy efficiency in building codes. 

Sec. 202. Building retrofit program. 

Sec. 203. Energy efficient manufactured homes. 

Sec. 204. Building energy performance labeling program. 

Sec. 205. Tree planting programs. 

Sec. 206. Energy efficiency for data center buildings. 

Subtitle B—Lighting and Appliance Energy Efficiency Programs 

Sec. 211. Lighting efficiency standards. 

Sec. 212. Other appliance efficiency standards. 

Sec. 213. Appliance efficiency determinations and procedures. 

Sec. 214. Best-in-Class Appliances Deployment Program. 

Sec. 215. WaterSense. 

Sec. 216. Federal procurement of water efficient products. 

Sec. 217. Water efficient product rebate programs. 

Sec. 218. Certified stoves program. 

Sec. 219. Energy Star standards. 

Subtitle C—Transportation Efficiency 

Sec. 221. Emissions standards. 

‘‘PART B—MOBILE SOURCES

‘‘Sec. 821. Greenhouse gas emission standards for mobile sources. 

Sec. 222. Greenhouse gas emissions reductions through transportation efficiency. 

‘‘PART D—TRANSPORTATION EMISSIONS

‘‘Sec. 841. Greenhouse gas emissions reductions through transportation efficiency. 

Sec. 223. SmartWay transportation efficiency program. 

‘‘Sec. 822. SmartWay transportation efficiency program. 

Sec. 224. State vehicle fleets. 

Subtitle D—Industrial Energy Efficiency Programs 

Sec. 241. Industrial plant energy efficiency standards. 

Sec. 242. Electric and thermal waste energy recovery award program. 

Sec. 243. Clarifying election of waste heat recovery financial incentives. 

Sec. 244. Motor market assessment and commercial awareness program. 

Sec. 245. Motor efficiency rebate program. 

Subtitle E—Improvements in Energy Savings Performance Contracting 

Sec. 251. Energy savings performance contracts. 

Subtitle F—Public Institutions 

Sec. 261. Public institutions. 

Sec. 262. Community energy efficiency flexibility. 

Sec. 263. Small community joint participation. 

Sec. 264. Low income community energy efficiency program. 

Subtitle G—Miscellaneous 

Sec. 271. Energy efficient information and communications technologies. 


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Sec. 272. National energy efficiency goals. 

Sec. 273. Affiliated island energy independence team. 

Sec. 274. Product carbon disclosure program. 

TITLE III—REDUCING GLOBAL WARMING POLLUTION 

Sec. 301. Short title. 

Subtitle A—Reducing Global Warming Pollution 

Sec. 311. Reducing global warming pollution. 

‘‘TITLE VII—GLOBAL WARMING POLLUTION REDUCTION 

PROGRAM 

‘‘PART A—GLOBAL WARMING POLLUTION REDUCTION GOALS AND TARGETS

‘‘Sec. 701. Findings and purpose. 

‘‘Sec. 702. Economy-wide reduction goals. 

‘‘Sec. 703. Reduction targets for specified sources. 

‘‘Sec. 704. Supplemental pollution reductions. 

‘‘Sec. 705. Review and program recommendations. 

‘‘Sec. 706. National Academy review. 

‘‘Sec. 707. Presidential response and recommendations. 

‘‘PART B—DESIGNATION AND REGISTRATION OF GREENHOUSE GASES

‘‘Sec. 711. Designation of greenhouse gases. 

‘‘Sec. 712. Carbon dioxide equivalent value of greenhouse gases. 

‘‘Sec. 713. Greenhouse gas registry. 

‘‘PART C—PROGRAM RULES

‘‘Sec. 721. Emission allowances. 

‘‘Sec. 722. Prohibition of excess emissions. 

‘‘Sec. 723. Penalty for noncompliance. 

‘‘Sec. 724. Trading. 

‘‘Sec. 725. Banking and borrowing. 

‘‘Sec. 726. Strategic reserve. 

‘‘Sec. 727. Permits. 

‘‘Sec. 728. International emission allowances. 

‘‘PART D—OFFSETS

‘‘Sec. 731. Offsets Integrity Advisory Board. 

‘‘Sec. 732. Establishment of offsets program. 

‘‘Sec. 733. Eligible project types. 

‘‘Sec. 734. Requirements for offset projects. 

‘‘Sec. 735. Approval of offset projects. 

‘‘Sec. 736. Verification of offset projects. 

‘‘Sec. 737. Issuance of offset credits. 

‘‘Sec. 738. Audits. 

‘‘Sec. 739. Program review and revision. 

‘‘Sec. 740. Early offset supply. 

‘‘Sec. 741. Environmental considerations. 

‘‘Sec. 742. Trading. 

‘‘Sec. 743. International offset credits. 


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‘‘PART E—SUPPLEMENTAL EMISSIONS REDUCTIONS FROM REDUCED

DEFORESTATION

‘‘Sec. 751. Definitions. 

‘‘Sec. 752. Findings. 

‘‘Sec. 753. Supplemental emissions reductions through reduced deforestation. 

‘‘Sec. 754. Requirements for international deforestation reduction program. 

‘‘Sec. 755. Reports and reviews. 

‘‘Sec. 756. Legal effect of part. 

Sec. 312. Definitions. 

‘‘Sec. 700. Definitions. 

Subtitle B—Disposition of Allowances 

Sec. 321. Disposition of allowances for global warming pollution reduction program. 

‘‘PART H—DISPOSITION OF ALLOWANCES

‘‘Sec. 781. Allocation of allowances for supplemental reductions. 

‘‘Sec. 782. Allocation of emission allowances. 

‘‘Sec. 783. Electricity consumers. 

‘‘Sec. 784. Natural gas consumers. 

‘‘Sec. 785. Home heating oil, propane, and kerosene consumers. 

‘‘Sec. 787. Allocations to refineries. 

‘‘Sec. 788. øSECTION RESERVED¿. 

‘‘Sec. 789. Climate change consumer refunds. 

‘‘Sec. 790. Exchange for State-issued allowances. 

‘‘Sec. 791. Auction procedures. 

‘‘Sec. 792. Auctioning allowances for other entities. 

‘‘Sec. 793. Establishment of funds. 

‘‘Sec. 794. Oversight of allocations. 

Subtitle C—Additional Greenhouse Gas Standards 

Sec. 331. Greenhouse gas standards. 

‘‘TITLE VIII—ADDITIONAL GREENHOUSE GAS STANDARDS 

‘‘Sec. 801. Definitions. 

‘‘PART A—STATIONARY SOURCE STANDARDS

‘‘Sec. 811. Standards of performance. 

‘‘PART C—EXEMPTIONS FROM OTHER PROGRAMS

‘‘Sec. 831. Criteria pollutants. 

‘‘Sec. 832. International air pollution. 

‘‘Sec. 833. Hazardous air pollutants. 

‘‘Sec. 834. New source review. 

‘‘Sec. 835. Title V permits. 

Sec. 332. HFC Regulation. 

Sec. 333. Black carbon. 

‘‘PART E—BLACK CARBON


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‘‘Sec. 851. Black carbon. 

Sec. 334. States. 

Sec. 335. State programs. 

‘‘PART F—MISCELLANEOUS

‘‘Sec. 861. State programs. 

‘‘Sec. 862. Grants for support of air pollution control programs. 

Sec. 336. Enforcement. 

Sec. 337. Conforming amendments. 

Sec. 338. Davis-Bacon compliance. 

Sec. 339. National strategy for domestic biological carbon sequestration. 

Subtitle D—Carbon Market Assurance 

Sec. 341. Carbon market assurance. 

Subtitle E—Additional Market Assurance 

Sec. 351. Regulation of certain transactions in derivatives involving energy 

commodities. 

Sec. 352. No effect on authority of the Federal Energy Regulatory Commission. 

Sec. 353. Inspector General of the Commodity Futures Trading Commission. 

Sec. 354. Settlement and clearing through registered derivatives clearing organizations. 

Sec. 355. Limitation on eligibility to purchase a credit default swap. 

Sec. 356. Transaction fees. 

Sec. 357. No effect on antitrust law or authority of the Federal Trade Commission. 

Sec. 358. Regulation of carbon derivatives markets. 

Sec. 359. Cease-and-desist authority. 

TITLE IV—TRANSITIONING TO A CLEAN ENERGY ECONOMY 

Subtitle A—Ensuring Real Reductions in Industrial Emissions 

Sec. 401. Ensuring real reductions in industrial emissions. 

‘‘PART F—ENSURING REAL REDUCTIONS IN INDUSTRIAL EMISSIONS

‘‘Sec. 761. Purposes. 

‘‘Sec. 762. International negotiations. 

‘‘Sec. 763. Definitions. 

‘‘SUBPART 1—EMISSION ALLOWANCE REBATE PROGRAM

‘‘Sec. 764. Eligible industrial sectors. 

‘‘Sec. 765. Distribution of emission allowance rebates. 

‘‘SUBPART 2—INTERNATIONAL RESERVE ALLOWANCE PROGRAM

‘‘Sec. 766. International reserve allowance program. 

‘‘SUBPART 3—PRESIDENTIAL DETERMINATION

‘‘Sec. 767. Presidential reports and determinations. 

Subtitle B—Green Jobs and Worker Transition 


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PART 1—GREEN JOBS

Sec. 421. Clean energy curriculum development grants. 

Sec. 422. Increased funding for energy worker training program. 

PART 2—CLIMATE CHANGE WORKER ADJUSTMENT ASSISTANCE

Sec. 425. Petitions, eligibility requirements, and determinations. 

Sec. 426. Program benefits. 

Sec. 427. General provisions. 

Subtitle C—Consumer Assistance 

Sec. 431. Energy refund program. 

Sec. 432. Modification of earned income credit amount for individuals with no 

qualifying children. 

Sec. 433. Protection of Social Security and Medicare trust funds. 

Subtitle D—Exporting Clean Technology 

Sec. 441. Findings and purposes. 

Sec. 442. Definitions. 

Sec. 443. Governance. 

Sec. 444. Determination of eligible countries. 

Sec. 445. Qualifying activities. 

Sec. 446. Assistance. 

Subtitle E—Adapting to Climate Change 

PART 1—DOMESTIC ADAPTATION

SUBPART A—NATIONAL CLIMATE CHANGE ADAPTATION PROGRAM

Sec. 451. Global change research and data management. 

Sec. 452. National Climate Service. 

Sec. 453. State programs to build resilience to climate change impacts. 

SUBPART B—PUBLIC HEALTH AND CLIMATE CHANGE

Sec. 461. Sense of Congress on public health and climate change. 

Sec. 462. Relationship to other laws. 

Sec. 463. National strategic action plan. 

Sec. 464. Advisory board. 

Sec. 465. Reports. 

Sec. 466. Definitions. 

Sec. 467. Climate Change Health Protection and Promotion Fund. 

SUBPART C—NATURAL RESOURCE ADAPTATION

Sec. 471. Purposes. 

Sec. 472. Natural resources climate change adaptation policy. 

Sec. 473. Definitions. 

Sec. 474. Council on Environmental Quality. 

Sec. 475. Natural Resources Climate Change Adaptation Panel. 

Sec. 476. Natural Resources Climate Change Adaptation Strategy. 

Sec. 477. Natural resources adaptation science and information. 

Sec. 478. Federal natural resource agency adaptation plans. 

Sec. 479. State natural resources adaptation plans. 

Sec. 480. Natural Resources Climate Change Adaptation Fund. 


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Sec. 481. National Wildlife Habitat and Corridors Information Program. 

Sec. 482. Additional provisions regarding Indian tribes. 

PART 2—INTERNATIONAL CLIMATE CHANGE ADAPTATION PROGRAM

Sec. 491. Findings and purposes. 

Sec. 492. Definitions. 

Sec. 493. International Climate Change Adaptation Program. 

Sec. 494. Distribution of allowances. 

Sec. 495. Bilateral assistance. 

1 SEC. 2. DEFINITIONS. 

2 For purposes of this Act: 

3 (1) ADMINISTRATOR.—The term ‘‘Adminis4 trator’’ means the Administrator of the Environ5 mental Protection Agency. 

6 (2) STATE.—The term ‘‘State’’ has the mean7 ing given that term in section 302 of the Clean Air 

8 Act. 

9 SEC. 3. INTERNATIONAL PARTICIPATION. 

10 The Administrator, in consultation with the Depart11 ment of State and the United States Trade Representa12 tive, shall annually prepare and certify a report to the 

13 Congress regarding whether China and India have adopted 

14 greenhouse gas emissions standards at least as strict as 

15 those standards required under this Act. If the Adminis16 trator determines that China and India have not adopted 

17 greenhouse gas emissions standards at least as stringent 

18 as those set forth in this Act, the Administrator shall no19 tify each Member of Congress of his determination, and 

20 shall release his determination to the media. 


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1 TITLE I—CLEAN ENERGY 

2 Subtitle A—Combined Efficiency 

3 and Renewable Electricity 

4 Standard 

5 SEC. 101. COMBINED EFFICIENCY AND RENEWABLE ELEC6 TRICITY STANDARD. 

7 (a) IN GENERAL.—Title VI of the Public Utility Reg8 ulatory Policies Act of 1978 (16 U.S.C. 2601 and fol9 lowing) is amended by adding at the end the following: 

10 ‘‘SEC. 610. COMBINED EFFICIENCY AND RENEWABLE ELEC11 TRICITY STANDARD. 

12 ‘‘(a) DEFINITIONS.—For purposes of this section: 

13 ‘‘(1) CHP SAVINGS.—The term ‘CHP savings’ 

14 means— 

15 ‘‘(A) CHP system savings from a combined 

16 heat and power system that commences oper17 ation after the date of enactment of this sec18 tion; and 

19 ‘‘(B) the increase in CHP system savings 

20 from, at any time after the date of the enact21 ment of this section, upgrading, replacing, ex22 panding, or increasing the utilization of a com23 bined heat and power system that commenced 

24 operation on or before the date of enactment of 

25 this section. 


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1 ‘‘(2) CHP SYSTEM SAVINGS.—The term ‘CHP 

2 system savings’ means the increment of electric out3 put of a combined heat and power system that is at4 tributable to the higher efficiency of the combined 

5 system (as compared to the efficiency of separate 

6 production of the electric and thermal outputs). 

7 ‘‘(3) COMBINED HEAT AND POWER SYSTEM.— 

8 The term ‘combined heat and power system’ means 

9 a system that uses the same energy source both for 

10 the generation of electrical or mechanical power and 

11 the production of steam or another form of useful 

12 thermal energy, provided that— 

13 ‘‘(A) the system meets such requirements 

14 relating to efficiency and other operating char15 acteristics as the Commission may promulgate 

16 by regulation; and 

17 ‘‘(B) the net sales of electricity by the fa18 cility to customers not consuming the thermal 

19 output from that facility will not exceed 50 per20 cent of total annual electric generation by the 

21 facility. 

22 ‘‘(4) CUSTOMER FACILITY SAVINGS.—The term 

23 ‘customer facility savings’ means a reduction in end24 use electricity consumption (including recycled en25 ergy savings) at a facility of an end-use consumer of 


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1 electricity served by a retail electric supplier, as 

2 compared to— 

3 ‘‘(A) in the case of a new facility, con4 sumption at a reference facility of average effi5 ciency; 

6 ‘‘(B) in the case of an existing facility, 

7 consumption at such facility during a base pe8 riod, except as provided in subparagraphs (C) 

9 and (D); 

10 ‘‘(C) in the case of new equipment that re11 places existing equipment with remaining useful 

12 life, the projected consumption of the existing 

13 equipment for the remaining useful life of such 

14 equipment, and thereafter, consumption of new 

15 equipment of average efficiency of the same 

16 equipment type; and 

17 ‘‘(D) in the case of new equipment that re18 places existing equipment at the end of the use19 ful life of the existing equipment, consumption 

20 by new equipment of average efficiency of the 

21 same equipment type. 

22 ‘‘(5) DISTRIBUTED RENEWABLE GENERATION

23 FACILITY.—The term ‘distributed renewable genera24 tion facility’ means a facility that— 

25 ‘‘(A) generates renewable electricity; 


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1 ‘‘(B) primarily serves 1 or more electricity 

2 consumers at or near the facility site; and 

3 ‘‘(C) is no greater than— 

4 ‘‘(i) 2 megawatts in capacity; or 

5 ‘‘(ii) 4 megawatts in capacity, in the 

6 case of a facility that is placed in service 

7 after the date of enactment of this section 

8 and generates electricity from a renewable 

9 energy resource other than by means of 

10 combustion. 

11 ‘‘(6) ELECTRICITY SAVINGS.—The term ‘elec12 tricity savings’ means reductions in electricity con13 sumption, relative to business-as-usual projections, 

14 achieved through measures implemented after the 

15 date of enactment of this section, limited to— 

16 ‘‘(A) customer facility savings of elec17 tricity, adjusted to reflect any associated in18 crease in fuel consumption at the facility; 

19 ‘‘(B) reductions in distribution system 

20 losses of electricity achieved by a retail elec21 tricity distributor, as compared to losses attrib22 utable to new or replacement distribution sys23 tem equipment of average efficiency; 

24 ‘‘(C) CHP savings; and 

25 ‘‘(D) fuel cell savings. 


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1 ‘‘(7) FEDERAL LAND.—The term ‘Federal land’ 

2 means land owned by the United States, other than 

3 land held in trust for an Indian or Indian tribe. 

4 ‘‘(8) FEDERAL RENEWABLE ELECTRICITY

5 CREDIT.—The term ‘Federal renewable electricity 

6 credit’ means a credit, representing one megawatt 

7 hour of renewable electricity, issued pursuant to sub8 section (e). 

9 ‘‘(9) FUEL CELL.—The term ‘fuel cell’ means a 

10 device that directly converts the chemical energy of 

11 a fuel and an oxidant into electricity by electro12 chemical processes occurring at separate electrodes 

13 in the device. 

14 ‘‘(10) FUEL CELL SAVINGS.—The term ‘fuel 

15 cell savings’ means the electricity saved by a fuel cell 

16 that is installed after the date of enactment of this 

17 section, or by upgrading a fuel cell that commenced 

18 operation on or before the date of enactment of this 

19 section, as a result of the greater efficiency with 

20 which the fuel cell transforms fuel into electricity as 

21 compared with sources of electricity delivered 

22 through the grid, provided that— 

23 ‘‘(A) the fuel cell meets such requirements 

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1 acteristics as the Commission may promulgate 

2 by regulation; and 

3 ‘‘(B) the net sales of electricity from the 

4 fuel cell to customers not consuming the ther5 mal output from the fuel cell, if any, do not ex6 ceed 50 percent of the total annual electricity 

7 generation by the fuel cell. 

8 ‘‘(11) HIGH CONSERVATION PRIORITY LAND.— 

9 The term ‘high conservation priority land’ means 

10 land that is not Federal land and is— 

11 ‘‘(A) globally or State ranked as critically 

12 imperiled or imperiled under a State Natural 

13 Heritage Program; or 

14 ‘‘(B) old-growth or late-successional forest, 

15 as identified by the office of the relevant State 

16 Forester or relevant State agency with regu17 latory jurisdiction over forestry activities. 

18 ‘‘(12) OTHER QUALIFYING ENERGY RE19 SOURCE.—The term ‘other qualifying energy re20 source’ means any of the following: 

21 ‘‘(A) Landfill gas. 

22 ‘‘(B) Wastewater treatment gas. 

23 ‘‘(C) Coal mine methane used to generate 

24 electricity at or near the mine mouth. 

25 ‘‘(D) Qualified waste-to-energy. 


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1 ‘‘(13) QUALIFIED HYDROPOWER.—The term 

2 ‘qualified hydropower’ means— 

3 ‘‘(A) energy produced from increased effi4 ciency achieved, or additions of capacity made, 

5 on or after January 1, 1992, at a hydroelectric 

6 facility that was placed in service before that 

7 date and does not include additional energy 

8 generated as a result of operational changes not 

9 directly associated with efficiency improvements 

10 or capacity additions; or 

11 ‘‘(B) energy produced from generating ca12 pacity added to a dam on or after January 1, 

13 1992, provided that the Commission certifies 

14 that— 

15 ‘‘(i) the dam was placed in service be16 fore the date of the enactment of this sec17 tion and was operated for flood control, 

18 navigation, or water supply purposes and 

19 was not producing hydroelectric power 

20 prior to the addition of such capacity; 

21 ‘‘(ii) the hydroelectric project installed 

22 on the dam is licensed (or is exempt from 

23 licensing) by the Commission and is in 

24 compliance with the terms and conditions 

25 of the license or exemption, and with other 


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1 applicable legal requirements for the pro2 tection of environmental quality, including 

3 applicable fish passage requirements; and 

4 ‘‘(iii) the hydroelectric project in5 stalled on the dam is operated so that the 

6 water surface elevation at any given loca7 tion and time that would have occurred in 

8 the absence of the hydroelectric project is 

9 maintained, subject to any license or ex10 emption requirements that require changes 

11 in water surface elevation for the purpose 

12 of improving the environmental quality of 

13 the affected waterway. 

14 ‘‘(14) QUALIFIED WASTE-TO-ENERGY.—The 

15 term ‘qualified waste-to-energy’ means energy from 

16 the combustion of municipal solid waste or construc17 tion, demolition, or disaster debris, or from the gas18 ification or pyrolization of such waste or debris and 

19 the combustion of the resulting gas at the same fa20 cility, provided that— 

21 ‘‘(A) such term shall include only the en22 ergy derived from the non-fossil biogenic por23 tion of such waste or debris; 

24 ‘‘(B) the Commission determines, with the 

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1 ronmental Protection Agency, that the total 

2 lifecycle greenhouse gas emissions attributable 

3 to the generation of electricity from such waste 

4 or debris are lower than those attributable to 

5 the likely alternative method of disposing of 

6 such waste or debris; and 

7 ‘‘(C) the owner or operator of the facility 

8 generating electricity from such energy provides 

9 to the Commission, on an annual basis— 

10 ‘‘(i) a certification that the facility is 

11 in compliance with all applicable State, 

12 tribal, and Federal environmental permits; 

13 ‘‘(ii) in the case of a facility that com14 menced operation before the date of enact15 ment of this section, a certification that 

16 the facility meets emissions standards pro17 mulgated under sections 112 or 129 of the 

18 Clean Air Act (42 U.S.C. 7412 or 7429) 

19 that apply as of the date of enactment of 

20 this section to new facilities within the rel21 evant source category; and 

22 ‘‘(iii) in the case of the combustion, 

23 pyrolization, or gasification of municipal 

24 solid waste, a certification that each local 

25 government unit from which such waste 


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1 originates operates, participates in the op2 eration of, contracts for, or otherwise pro3 vides for, recycling services for its resi4 dents. 

5 ‘‘(15) RECYCLED ENERGY SAVINGS.—The term 

6 ‘recycled energy savings’ means a reduction in elec7 tricity consumption that results from a modification 

8 of an industrial or commercial system that com9 menced operation before the date of enactment of 

10 this section, in order to recapture electrical, mechan11 ical, or thermal energy that would otherwise be 

12 wasted. 

13 ‘‘(16) RENEWABLE BIOMASS.—The term ‘re14 newable biomass’ means any of the following: 

15 ‘‘(A) Plant material, including waste mate16 rial, harvested or collected from actively man17 aged agricultural land that was in cultivation, 

18 cleared, or fallow and nonforested on January 

19 1, 2009. 

20 ‘‘(B) Plant material, including waste mate21 rial, harvested or collected from pastureland 

22 that was nonforested on January 1, 2009. 

23 ‘‘(C) Nonhazardous vegetative matter de24 rived from waste, including separated yard 

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1 struction and demolition debris or food waste 

2 (but not municipal solid waste, recyclable waste 

3 paper, painted, treated or pressurized wood, or 

4 wood contaminated with plastic or metals). 

5 ‘‘(D) Animal waste or animal byproducts, 

6 including products of animal waste digesters. 

7 ‘‘(E) Algae. 

8 ‘‘(F) Trees, brush, slash, residues, or any 

9 other vegetative matter removed from within 

10 600 feet of any building, campground, or route 

11 designated for evacuation by a public official 

12 with responsibility for emergency preparedness, 

13 or from within 300 feet of a paved road, electric 

14 transmission line, utility tower, or water supply 

15 line. 

16 ‘‘(G) Residues from or byproducts of 

17 milled logs. 

18 ‘‘(H) Any of the following removed from 

19 forested land that is not Federal and is not 

20 high conservation priority land: 

21 ‘‘(i) Trees, brush, slash, residues, 

22 interplanted energy crops, or any other 

23 vegetative matter removed from an actively 

24 managed tree plantation established— 

25 ‘‘(I) prior to January 1, 2009; or 


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1 ‘‘(II) on land that, as of January 

2 1, 2009, was cultivated or fallow and 

3 non-forested. 

4 ‘‘(ii) Trees, logging residue, thinnings, 

5 cull trees, pulpwood, and brush removed 

6 from naturally-regenerated forests or other 

7 non-plantation forests, including for the 

8 purposes of hazardous fuel reduction or 

9 preventative treatment for reducing or con10 taining insect or disease infestation. 

11 ‘‘(iii) Logging residue, thinnings, cull 

12 trees, pulpwood, brush and species that are 

13 non-native and noxious, from stands that 

14 were planted and managed after January 

15 1, 2009, to restore or maintain native for16 est types. 

17 ‘‘(iv) Dead or severely damaged trees 

18 removed within 5 years of fire, blowdown, 

19 or other natural disaster, and badly in20 fested trees. 

21 ‘‘(I) Materials, pre-commercial thinnings, 

22 or removed invasive species from National For23 est System land and public lands (as defined in 

24 section 103 of the Federal Land Policy and 

25 Management Act of 1976 (43 U.S.C. 1702)), 


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1 including those that are byproducts of preven2 tive treatments (such as trees, wood, brush, 

3 thinnings, chips, and slash), that are removed 

4 as part of a federally recognized timber sale, or 

5 that are removed to reduce hazardous fuels, to 

6 reduce or contain disease or insect infestation, 

7 or to restore ecosystem health, and that are— 

8 ‘‘(i) not from components of the Na9 tional Wilderness Preservation System, 

10 Wilderness Study Areas, Inventoried 

11 Roadless Areas, old growth or mature for12 est stands, components of the National 

13 Landscape Conservation System, National 

14 Monuments, National Conservation Areas, 

15 Designated Primitive Areas, or Wild and 

16 Scenic Rivers corridors; 

17 ‘‘(ii) harvested in environmentally sus18 tainable quantities, as determined by the 

19 appropriate Federal land manager; and 

20 ‘‘(iii) harvested in accordance with 

21 Federal and State law and applicable land 

22 management plans. 

23 ‘‘(17) RENEWABLE ELECTRICITY.—The term 

24 ‘renewable electricity’ means electricity generated 


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1 (including by means of a fuel cell) from a renewable 

2 energy resource or other qualifying energy resources. 

3 ‘‘(18) RENEWABLE ENERGY RESOURCE.—The 

4 term ‘renewable energy resource’ means each of the 

5 following: 

6 ‘‘(A) Wind energy. 

7 ‘‘(B) Solar energy. 

8 ‘‘(C) Geothermal energy. 

9 ‘‘(D) Renewable biomass. 

10 ‘‘(E) Biogas derived exclusively from re11 newable biomass. 

12 ‘‘(F) Biofuels derived exclusively from re13 newable biomass. 

14 ‘‘(G) Qualified hydropower. 

15 ‘‘(H) Marine and hydrokinetic renewable 

16 energy, as that term is defined in section 632 

17 of the Energy Independence and Security Act 

18 of 2007 (42 U.S.C. 17211). 

19 ‘‘(19) RETAIL ELECTRIC SUPPLIER.— 

20 ‘‘(A) IN GENERAL.—The term ‘retail elec21 tric supplier’ means, for any given year, an 

22 electric utility that sold not less than 4,000,000 

23 megawatt hours of electric energy to electric 

24 consumers for purposes other than resale dur25 ing the preceding calendar year. 


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1 ‘‘(B) INCLUSIONS AND LIMITATIONS.—For 

2 purposes of determining whether an electric 

3 utility qualifies as a retail electric supplier 

4 under subparagraph (A)— 

5 ‘‘(i) the sales of any affiliate of an 

6 electric utility to electric consumers, other 

7 than sales to the affiliate’s lessees or ten8 ants, for purposes other than resale shall 

9 be considered to be sales of such electric 

10 utility; and 

11 ‘‘(ii) sales by any electric utility to an 

12 affiliate, lessee, or tenant of such electric 

13 utility shall not be treated as sales to elec14 tric consumers. 

15 ‘‘(C) AFFILIATE.—For purposes of this 

16 paragraph, the term ‘affiliate’ when used in re17 lation to a person, means another person that 

18 directly or indirectly owns or controls, is owned 

19 or controlled by, or is under common ownership 

20 or control with, such person, as determined 

21 under regulations promulgated by the Commis22 sion. 

23 ‘‘(20) RETAIL ELECTRIC SUPPLIER’S BASE

24 AMOUNT.—The term ‘retail electric supplier’s base 

25 amount’ means the total amount of electric energy 


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1 sold by the retail electric supplier, expressed in 

2 megawatt hours, to electric customers for purposes 

3 other than resale during the relevant calendar year, 

4 excluding— 

5 ‘‘(A) electricity generated by a hydro6 electric facility that is not qualified hydropower; 

7 ‘‘(B) electricity generated by a nuclear 

8 generating unit placed in service after the date 

9 of enactment of this section; and 

10 ‘‘(C) the proportion of electricity generated 

11 by a fossil-fueled generating unit that is equal 

12 to the proportion of greenhouse gases produced 

13 by such unit that are captured and geologically 

14 sequestered. 

15 ‘‘(21) RETIRE AND RETIREMENT.—The terms 

16 ‘retire’ and ‘retirement’ with respect to a Federal re17 newable electricity credit, means to disqualify such 

18 credit for any subsequent use under this section, re19 gardless of whether the use is a sale, transfer, ex20 change, or submission in satisfaction of a compliance 

21 obligation. 

22 ‘‘(22) THIRD-PARTY EFFICIENCY PROVIDER.— 

23 The term ‘third-party efficiency provider’ means any 

24 retailer, building owner, energy service company, fi25 nancial institution or other commercial, industrial or 


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1 nonprofit entity that is capable of providing elec2 tricity savings in accordance with the requirements 

3 of this section. 

4 ‘‘(23) TOTAL ANNUAL ELECTRICITY SAVINGS.— 

5 The term ‘total annual electricity savings’ means 

6 electricity savings during a specified calendar year 

7 from measures implemented since the date of the en8 actment of this section, taking into account verified 

9 measure lifetimes or verified annual savings attrition 

10 rates, as determined in accordance with such regula11 tions as the Commission may promulgate and meas12 ured in megawatt hours. 

13 ‘‘(b) ANNUAL COMPLIANCE OBLIGATION.— 

14 ‘‘(1) IN GENERAL.—For each of calendar years 

15 2012 through 2039, not later than March 31 of the 

16 following calendar year, each retail electric supplier 

17 shall submit to the Commission an amount of Fed18 eral renewable electricity credits and demonstrated 

19 total annual electricity savings that, in the aggre20 gate, is equal to such retail electric supplier’s annual 

21 combined target as set forth in subsection (d), ex22 cept as otherwise provided in subsection (g). 

23 ‘‘(2) DEMONSTRATION OF SAVINGS.—For pur24 poses of this subsection, submission of demonstrated 

25 total annual electricity savings means submission of 


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1 a report that demonstrates, in accordance with the 

2 requirements of subsection (f), the total annual elec3 tricity savings achieved by the retail electric supplier 

4 within the relevant compliance year. 

5 ‘‘(3) RENEWABLE ELECTRICITY CREDITS POR6 TION.—Except as provided in paragraph (4), each 

7 retail electric supplier must submit Federal renew8 able electricity credits equal to at least three quar9 ters of the retail electric supplier’s annual combined 

10 target. 

11 ‘‘(4) STATE PETITION.— 

12 ‘‘(A) IN GENERAL.—Upon written request 

13 from the Governor of any State (including, for 

14 purposes of this paragraph, the Mayor of the 

15 District of Columbia), the Commission shall in16 crease, to not more than two fifths, the propor17 tion of the annual combined targets of retail 

18 electric suppliers located within such State that 

19 may be met through submission of dem20 onstrated total annual electricity savings, pro21 vided that such increase shall be effective only 

22 with regard to the portion of a retail electric 

23 supplier’s annual combined target that is attrib24 utable to electricity sales within such State. 


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1 ‘‘(B) CONTENTS.—A Governor’s request 

2 under this paragraph shall include an expla3 nation of the Governor’s rationale for deter4 mining, after consultation with the relevant 

5 State regulatory authority and other retail elec6 tricity ratemaking authorities within the State, 

7 to make such request. The request shall specify 

8 the maximum proportion of annual combined 

9 targets (not more than two fifths) that can be 

10 met through demonstrated total annual elec11 tricity savings, and the period for which such 

12 proportion shall be effective. 

13 ‘‘(C) REVISION.—The Governor of any 

14 State may, after consultation with the relevant 

15 State regulatory authority and other retail elec16 tricity ratemaking authorities within the State, 

17 submit a written request for revocation or revi18 sion of a previous request submitted under this 

19 paragraph. The Commission shall grant such 

20 request, provided that— 

21 ‘‘(i) any revocation or revision shall 

22 not apply to the combined annual target 

23 for any year that is any earlier than 2 cal24 endar years after the calendar year in 

25 which such request is submitted, so as to 


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1 provide retail electric suppliers with ade2 quate notice of such change; and 

3 ‘‘(ii) any revision shall meet the re4 quirements of subparagraph (A). 

5 ‘‘(c) ESTABLISHMENT OF PROGRAM.—Not later than 

6 1 year after the date of enactment of this section, the 

7 Commission shall promulgate regulations to implement 

8 and enforce the requirements of this section. In promul9 gating such regulations, the Commission shall, to the ex10 tent practicable— 

11 ‘‘(1) preserve the integrity, and incorporate best 

12 practices, of existing State and tribal renewable elec13 tricity and energy efficiency programs; 

14 ‘‘(2) rely upon existing and emerging State, 

15 tribal, or regional tracking systems that issue and 

16 track non-Federal renewable electricity credits; and 

17 ‘‘(3) cooperate with the States and Indian 

18 tribes to facilitate coordination between State, tribal, 

19 and Federal renewable electricity and energy effi20 ciency programs and to minimize administrative bur21 dens and costs to retail electric suppliers. 

22 ‘‘(d) ANNUAL COMPLIANCE REQUIREMENT.— 

23 ‘‘(1) ANNUAL COMBINED TARGETS.—For each 

24 of calendar years 2012 through 2039, a retail elecVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00029 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tric supplier’s annual combined target shall be the 

2 product of— 

3 ‘‘(A) the required annual percentage for 

4 such year, as set forth in paragraph (2); and 

5 ‘‘(B) the retail electric supplier’s base 

6 amount for such year. 

7 ‘‘(2) REQUIRED ANNUAL PERCENTAGE.—For 

8 each of calendar years 2012 through 2039, the re9 quired annual percentage shall be as follows: 

‘‘Calendar year Required annual 

percentage 

2012 ............................................................................... 6.0 

2013 ............................................................................... 6.0 

2014 ............................................................................... 9.5 

2015 ............................................................................... 9.5 

2016 ............................................................................... 13.0 

2017 ............................................................................... 13.0 

2018 ............................................................................... 16.5 

2019 ............................................................................... 16.5 

2020 ............................................................................... 20.0 

2021 through 2039 ........................................................ 20.0 

10 ‘‘(e) FEDERAL RENEWABLE ELECTRICITY CRED11 ITS.— 

12 ‘‘(1) IN GENERAL.—The regulations promul13 gated under this section shall include provisions gov14 erning the issuance, tracking, and verification of 

15 Federal renewable electricity credits. Except as pro16 vided in paragraphs (2), (3), and (4) of this sub17 section, the Commission shall issue to each gener18 ator of renewable electricity, 1 Federal renewable 

19 electricity credit for each megawatt hour of renewVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00030 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 able electricity generated by such generator after 

2 December 31, 2011. The Commission shall assign a 

3 unique serial number to each Federal renewable 

4 electricity credit. 

5 ‘‘(2) GENERATION FROM CERTAIN STATE RE6 NEWABLE ELECTRICITY PROGRAMS.—Where renew7 able electricity is generated with the support of pay8 ments from a retail electric supplier pursuant to a 

9 State renewable electricity program (whether 

10 through State alternative compliance payments or 

11 through payments to a State renewable electricity 

12 procurement fund or entity), the Commission shall 

13 issue Federal renewable electricity credits to such re14 tail electric supplier for the proportion of the rel15 evant renewable electricity generation that is attrib16 utable to the retail electric supplier’s payments, as 

17 determined pursuant to regulations issued by the 

18 Commission. For any remaining portion of the rel19 evant renewable electricity generation, the Commis20 sion shall issue Federal renewable electricity credits 

21 to the generator, as provided in paragraph (1), ex22 cept that in no event shall more than 1 Federal re23 newable electricity credit be issued for the same 

24 megawatt hour of electricity. In determining how 

25 Federal renewable electricity credits will be apporVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00031 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tioned among retail electric suppliers and generators 

2 in such circumstances, the Commission shall con3 sider information and guidance furnished by the rel4 evant State or States. 

5 ‘‘(3) CERTAIN POWER SALES CONTRACTS.— 

6 When a generator has sold renewable electricity to 

7 a retail electric supplier under a contract for power 

8 from a facility placed in service before the date of 

9 enactment of this section, and the contract does not 

10 provide for the determination of ownership of the 

11 Federal renewable electricity credits associated with 

12 such generation, the Commission shall issue such 

13 Federal renewable electricity credits to the retail 

14 electric supplier for the duration of the contract. 

15 ‘‘(4) CREDIT MULTIPLIER FOR DISTRIBUTED

16 RENEWABLE GENERATION.— 

17 ‘‘(A) IN GENERAL.—Except as provided in 

18 subparagraph (B), the Commission shall issue 3 

19 Federal renewable electricity credits for each 

20 megawatt hour of renewable electricity gen21 erated by a distributed renewable generation fa22 cility. 

23 ‘‘(B) ADJUSTMENT.—Except as provided 

24 in subparagraph (C), not later than January 1, 

25 2014, and not less frequently than every 4 


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1 years thereafter, the Commission shall review 

2 the effect of this paragraph and shall, as nec3 essary, reduce the number of Federal renewable 

4 electricity credits per megawatt hour issued 

5 under this paragraph for any given energy 

6 source or technology, but not below 1, to ensure 

7 that such number is no higher than the Com8 mission determines is necessary to make dis9 tributed renewable generation facilities using 

10 such source or technology cost competitive with 

11 other sources of renewable electricity genera12 tion. 

13 ‘‘(C) FACILITIES PLACED IN SERVICE

14 AFTER ENACTMENT.—For any distributed re15 newable generation facility placed in service 

16 after the date of enactment of this section, sub17 paragraph (B) shall not apply for the first 10 

18 years after the date on which the facility is 

19 placed in service. For each year during such 10- 

20 year period, the Commission shall issue to the 

21 facility the same number of Federal renewable 

22 electricity credits per megawatt hour as are 

23 issued to that facility in the year in which such 

24 facility is placed in service. After such 10-year 

25 period, the Commission shall issue Federal reVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00033 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 newable electricity credits to the facility in ac2 cordance with the current multiplier as deter3 mined pursuant to subparagraph (B). 

4 ‘‘(5) CREDITS BASED ON QUALIFIED HYDRO5 POWER.—For purposes of this subsection, the num6 ber of Federal renewable electricity credits issued for 

7 qualified hydropower shall be calculated— 

8 ‘‘(A) based solely on the increase in aver9 age annual generation directly resulting from 

10 the efficiency improvements or capacity addi11 tions described in subsection (a)(13)(A); and 

12 ‘‘(B) using the same water flow informa13 tion used to determine a historic average an14 nual generation baseline for the hydroelectric 

15 facility, as certified by the Commission. 

16 ‘‘(6) GENERATION FROM QUALIFIED WASTE-TO17 ENERGY.—In the case of electricity generated from 

18 the combustion of any municipal solid waste or con19 struction, demolition, or disaster debris that is in20 cluded in the definition of renewable biomass, or 

21 from the gasification or pyrolization of such waste or 

22 debris and the combustion of the resulting gas at 

23 the same facility, the Commission shall issue Federal 

24 renewable electricity credits only for electricity gen25 erated from qualified waste-to-energy. 


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1 ‘‘(7) GENERATION FROM MIXED RENEWABLE

2 AND NONRENEWABLE RESOURCES.—If electricity is 

3 generated using both a renewable energy resource or 

4 other qualifying energy resource and an energy 

5 source that is not a renewable energy resource or 

6 other qualifying energy resource (as, for example, in 

7 the case of co-firing of renewable biomass and fossil 

8 fuel), the Commission shall issue Federal renewable 

9 electricity credits based on the proportion of the 

10 electricity that is attributable to the renewable en11 ergy resource or other qualifying energy resource. 

12 ‘‘(8) PROHIBITION AGAINST DOUBLE-COUNT13 ING.—Except as provided in paragraph (4) of this 

14 subsection, the Commission shall ensure that no 

15 more than 1 Federal renewable electricity credit will 

16 be issued for any megawatt hour of renewable elec17 tricity and that no Federal renewable electricity 

18 credit will be used more than once for compliance 

19 with this section. 

20 ‘‘(9) TRADING.—The lawful holder of a Federal 

21 renewable electricity credit may sell, exchange, 

22 transfer, submit for compliance in accordance with 

23 subsection (b), or submit such credit for retirement 

24 by the Commission. 


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1 ‘‘(10) BANKING.—A Federal renewable elec2 tricity credit may be submitted in satisfaction of the 

3 compliance obligation set forth in subsection (b) for 

4 the compliance year in which the credit was issued 

5 or for any of the 3 immediately subsequent compli6 ance years. The Commission shall retire any Federal 

7 renewable electricity credit that has not been retired 

8 by April 2 of the calendar year that is 3 years after 

9 the calendar year in which the credit was issued. 

10 ‘‘(11) RETIREMENT.—The Commission shall re11 tire a Federal renewable electricity credit imme12 diately upon submission by the lawful holder of such 

13 credit, whether in satisfaction of a compliance obli14 gation under subsection (b) or on some other basis. 

15 ‘‘(f) ELECTRICITY SAVINGS.— 

16 ‘‘(1) STANDARDS FOR MEASUREMENT OF SAV17 INGS.—As part of the regulations promulgated 

18 under this section, the Commission shall prescribe 

19 standards and protocols for defining and measuring 

20 electricity savings and total annual electricity sav21 ings that can be counted towards the compliance ob22 ligation set forth in subsection (b). Such protocols 

23 and standards shall, at minimum— 


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1 ‘‘(A) specify the types of energy efficiency 

2 and energy conservation measures that can be 

3 counted; 

4 ‘‘(B) require that energy consumption esti5 mates for customer facilities or portions of fa6 cilities in the applicable base and current years 

7 be adjusted, as appropriate, to account for 

8 changes in weather, level of production, and 

9 building area; 

10 ‘‘(C) account for the useful life of meas11 ures; 

12 ‘‘(D) include deemed savings values for 

13 specific, commonly used measures; 

14 ‘‘(E) allow for savings from a program to 

15 be estimated based on extrapolation from a rep16 resentative sample of participating customers; 

17 ‘‘(F) include procedures for counting CHP 

18 savings, recycled energy savings, and fuel cell 

19 savings; 

20 ‘‘(G) include procedures for documenting 

21 measurable and verifiable electricity savings 

22 achieved as a result of market transformation 

23 efforts; 

24 ‘‘(H) include procedures for counting elec25 tricity savings achieved by solar water heating 


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1 and solar light pipe technology that has the ca2 pability to provide measurable data on the 

3 amount of megawatt-hours displaced; 

4 ‘‘(I) avoid double-counting of savings used 

5 for compliance with this section, including sav6 ings that are transferred pursuant to paragraph 

7 (3); 

8 ‘‘(J) ensure that, except as provided in 

9 subparagraph (L), the retail electric supplier 

10 claiming the savings played a significant role in 

11 achieving the savings (including through the ac12 tivities of a designated agent of the supplier or 

13 through the purchase of transferred savings); 

14 ‘‘(K) include savings from programs ad15 ministered by a retail electric supplier (or a re16 tail electricity distributor that is not a retail 

17 electric supplier) that are funded by State, Fed18 eral, or other sources; 

19 ‘‘(L) in any State in which the State regu20 latory authority has designated 1 or more enti21 ties to administer electric ratepayer-funded effi22 ciency programs approved by such State regu23 latory authority, provide that electricity savings 

24 achieved through such programs shall be dis25 tributed equitably among retail electric supVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00038 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 pliers in accordance with the direction of the 

2 relevant State regulatory authority; and 

3 ‘‘(M) exclude savings achieved as a result 

4 of compliance with mandatory appliance and 

5 equipment efficiency standards or building 

6 codes. 

7 ‘‘(2) STANDARDS FOR THIRD-PARTY

8 VERIFICATION OF SAVINGS.—The regulations pro9 mulgated under this section shall establish proce10 dures and standards requiring third-party 

11 verification of all reported electricity savings, includ12 ing requirements for accreditation of third-party 

13 verifiers to ensure that such verifiers are profes14 sionally qualified and have no conflicts of interest. 

15 ‘‘(3) TRANSFERS OF SAVINGS.— 

16 ‘‘(A) BILATERAL CONTRACTS FOR SAVINGS

17 TRANSFERS.—Subject to the limitations of this 

18 paragraph, a retail electric supplier may use 

19 electricity savings transferred, pursuant to a bi20 lateral contract, from another retail electric 

21 supplier, an owner of an electric distribution fa22 cility that is not a retail electric supplier, a 

23 State, or a third-party efficiency provider to 

24 meet the applicable compliance obligation under 

25 subsection (b). 


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1 ‘‘(B) REQUIREMENTS.—Electricity savings 

2 transferred and used for compliance pursuant 

3 to this paragraph shall be— 

4 ‘‘(i) measured and verified in accord5 ance with the procedures specified under 

6 this subsection; 

7 ‘‘(ii) reported in accordance with 

8 paragraph (4) of this subsection; and 

9 ‘‘(iii) achieved within the same State 

10 as is served by the retail electric supplier. 

11 ‘‘(C) REGULATORY APPROVAL.—Nothing 

12 in this paragraph shall limit or affect the au13 thority of a State regulatory authority to re14 quire a retail electric supplier that is regulated 

15 by such authority to obtain such authority’s au16 thorization or approval of a contract for trans17 fer of savings under this paragraph. 

18 ‘‘(4) REPORTING SAVINGS.— 

19 ‘‘(A) REQUIREMENTS.—The regulations 

20 promulgated under this section shall establish 

21 requirements governing the submission of re22 ports to demonstrate, in accordance with the 

23 protocols and standards for measurement and 

24 third-party verification established under this 

25 subsection, the total annual electricity savings 


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•HR 2998 IH

1 achieved by a retail electric supplier within the 

2 relevant year. 

3 ‘‘(B) REVIEW AND APPROVAL.—The Com4 mission shall review each report submitted to 

5 the Commission by a retail electric supplier and 

6 shall exclude any electricity savings that have 

7 not been adequately demonstrated in accord8 ance with the requirements of this subsection. 

9 ‘‘(5) STATE ADMINISTRATION.— 

10 ‘‘(A) DELEGATION OF AUTHORITY.—Upon 

11 receipt of an application from the Governor of 

12 a State (including, for purposes of this sub13 section, the Mayor of the District of Columbia), 

14 the Commission may delegate to the State the 

15 authority to review and verify reported elec16 tricity savings for purposes of determining dem17 onstrated total annual electricity savings that 

18 may be counted towards a retail electric sup19 plier’s compliance obligation under subsection 

20 (b). The Commission shall make a substantive 

21 determination approving or disapproving a 

22 State application under this subparagraph, 

23 after notice and comment, within 180 days of 

24 receipt of a complete application. 


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1 ‘‘(B) ALTERNATIVE MEASUREMENT AND

2 VERIFICATION PROCEDURES AND STAND3 ARDS.—As part of an application submitted 

4 under subparagraph (A), a State may request 

5 to use alternative measurement and verification 

6 procedures and standards to those specified in 

7 paragraphs (1) and (2), provided the State 

8 demonstrates that such alternative procedures 

9 and standards provide a level of accuracy of 

10 measurement and verification at least equiva11 lent to the Federal procedures and standards 

12 promulgated under paragraphs (1) and (2). 

13 ‘‘(C) REVIEW OF STATE IMPLEMENTA14 TION.—The Commission shall, not less fre15 quently than once every 4 years, review each 

16 State’s implementation of delegated authority 

17 under this paragraph to ensure conformance 

18 with the requirements of this section. The Com19 mission may, at any time, revoke the delegation 

20 of authority under this section upon a finding 

21 that the State is not implementing its delegated 

22 responsibilities in conformity with this para23 graph. As a condition of maintaining its dele24 gated authority under this paragraph, the Com25 mission may require a State to submit a revised 


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•HR 2998 IH

1 application under subparagraph (A) if the Com2 mission has— 

3 ‘‘(i) promulgated new or substantially 

4 revised measurement and verification pro5 cedures and standards under this sub6 section; or 

7 ‘‘(ii) otherwise substantially revised 

8 the program established under this section. 

9 ‘‘(g) ALTERNATIVE COMPLIANCE PAYMENTS.— 

10 ‘‘(1) IN GENERAL.—A retail electric supplier 

11 may satisfy the requirements of subsection (b) in 

12 whole or in part by submitting in accordance with 

13 this subsection, in lieu of each Federal renewable 

14 electricity credit or megawatt hour of demonstrated 

15 total annual electricity savings that would otherwise 

16 be due, a payment equal to $25, adjusted for infla17 tion on January 1 of each year following calendar 

18 year 2009, in accordance with such regulations as 

19 the Commission may promulgate. 

20 ‘‘(2) PAYMENT TO STATE FUNDS.—Except as 

21 otherwise provided in this paragraph, payments 

22 made under this subsection shall be made directly to 

23 the State or States in which the retail electric sup24 plier is located, in proportion to the portion of the 

25 retail electric supplier’s base amount that is sold 


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•HR 2998 IH

1 within each relevant State, provided that such pay2 ments are deposited directly into a fund in the State 

3 treasury established for this purpose and that the 

4 State uses such funds in accordance with para5 graphs (3) and (4). If the Commission determines at 

6 any time that a State is in substantial noncompli7 ance with paragraph (3) or (4), the Commission 

8 shall direct that any future alternative compliance 

9 payments that would otherwise be paid to such State 

10 under this subsection shall instead be paid to the 

11 Commission and deposited in the United States 

12 Treasury. 

13 ‘‘(3) STATE USE OF FUNDS.—As a condition of 

14 continued receipt of alternative compliance payments 

15 pursuant to this subsection, a State shall use such 

16 payments exclusively for the purposes of— 

17 ‘‘(A) deploying technologies that generate 

18 electricity from renewable energy resources; or 

19 ‘‘(B) implementing cost-effective energy ef20 ficiency programs to achieve electricity savings. 

21 ‘‘(4) REPORTING.—As a condition of continued 

22 receipt of alternative compliance payments pursuant 

23 to this subsection, a State shall, within 12 months 

24 of receipt of any such payments and at 12-month in25 tervals thereafter until such payments are expended, 


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1 provide a report to the Commission, in accordance 

2 with such regulations as the Commission may pre3 scribe, giving a full accounting of the use of such 

4 payments, including a detailed description of the ac5 tivities funded thereby. 

6 ‘‘(h) INFORMATION COLLECTION.—The Commission 

7 may require any retail electric supplier, renewable elec8 tricity generator, or such other entities as the Commission 

9 deems appropriate, to provide any information the Com10 mission determines appropriate to carry out this section. 

11 Failure to submit such information or submission of false 

12 or misleading information under this subsection shall be 

13 a violation of this section. 

14 ‘‘(i) ENFORCEMENT AND JUDICIAL REVIEW.— 

15 ‘‘(1) FAILURE TO SUBMIT CREDITS OR DEM16 ONSTRATE SAVINGS.—If any person fails to comply 

17 with the requirements of subsection (b) or (g), such 

18 person shall be liable to pay to the Commission a 

19 civil penalty equal to the product of— 

20 ‘‘(A) double the alternative compliance 

21 payment calculated under subsection (g)(1), 

22 and 

23 ‘‘(B) the aggregate quantity of Federal re24 newable electricity credits, total annual elec25 tricity savings, or equivalent alternative compliVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00045 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ance payments that the person failed to submit 

2 in violation of the requirements of subsections 

3 (b) and (g). 

4 ‘‘(2) ENFORCEMENT.—The Commission shall 

5 assess a civil penalty under paragraph (1) in accord6 ance with the procedures described in section 31(d) 

7 of the Federal Power Act (16 U.S.C. 823b(d)). 

8 ‘‘(3) VIOLATION OF REQUIREMENT OF REGULA9 TIONS OR ORDERS.—Any person who violates, or 

10 fails or refuses to comply with, any requirement of 

11 a regulation promulgated or order issued under this 

12 section shall be subject to a civil penalty under sec13 tion 316A(b) of the Federal Power Act (16 U.S.C. 

14 825o–1). Such penalty shall be assessed by the Com15 mission in the same manner as in the case of a vio16 lation referred to in section 316A(b) of such Act. 

17 ‘‘(j) JUDICIAL REVIEW.—Any person aggrieved by a 

18 final action taken by the Commission under this section, 

19 other than the assessment of a civil penalty under sub20 section (i), may use the procedures for review described 

21 in section 313 of the Federal Power Act (16 U.S.C. 825l). 

22 For purposes of this paragraph, references to an order in 

23 section 313 of such Act shall be deemed to refer also to 

24 all other final actions of the Commission under this section 


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1 other than the assessment of a civil penalty under sub2 section (i). 

3 ‘‘(k) SAVINGS PROVISIONS.—Nothing in this section 

4 shall— 

5 ‘‘(1) diminish or qualify any authority of a 

6 State, a political subdivision of a State, or an Indian 

7 tribe to— 

8 ‘‘(A) adopt or enforce any law or regula9 tion respecting renewable electricity or energy 

10 efficiency, including any law or regulation es11 tablishing requirements more stringent than 

12 those established by this section, provided that 

13 no such law or regulation may relieve any per14 son of any requirement otherwise applicable 

15 under this section; or 

16 ‘‘(B) regulate the acquisition and disposi17 tion of Federal renewable electricity credits by 

18 retail electric suppliers within the jurisdiction of 

19 such State, political subdivision, or Indian tribe, 

20 including the authority to require such retail 

21 electric supplier to acquire and submit to the 

22 Secretary for retirement Federal renewable 

23 electricity credits in excess of those submitted 

24 under this section; or 


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1 ‘‘(2) affect the application of, or the responsi2 bility for compliance with, any other provision of law 

3 or regulation, including environmental and licensing 

4 requirements. 

5 ‘‘(l) SUNSET.—This section expires on December 31, 

6 2040.’’. 

7 (b) CONFORMING AMENDMENT.—The table of con8 tents set forth in section 1(b) of the Public Utility Regu9 latory Policies Act of 1978 (16 U.S.C. 2601 and following) 

10 is amended by inserting after the item relating to section 

11 609 the following: 

‘‘Sec. 610. Combined efficiency and renewable electricity standard.’’. 

12 SEC. 102. CLARIFYING STATE AUTHORITY TO ADOPT RE13 NEWABLE ENERGY INCENTIVES. 

14 Section 210 of the Public Utility Regulatory Policies 

15 Act of 1978 is amended by adding at the end thereof: 

16 ‘‘(o) CLARIFICATION OF STATE AUTHORITY TO

17 ADOPT RENEWABLE ENERGY INCENTIVES.—Notwith18 standing any other provision of this Act or the Federal 

19 Power Act, a State legislature or regulatory authority may 

20 set the rates for a sale of electric energy by a facility gen21 erating electric energy from renewable energy sources pur22 suant to a State-approved production incentive program 

23 under which the facility voluntarily sells electric energy. 

24 For purposes of this subsection, ‘State-approved produc25 tion incentive program’ means a requirement imposed purVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00048 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 suant to State law, or by a State regulatory authority act2 ing within its authority under State law, that an electric 

3 utility purchase renewable energy (as defined in section 

4 609 of this Act) at a specified rate.’’. 

5 Subtitle B—Carbon Capture and 

6 Sequestration 

7 SEC. 111. NATIONAL STRATEGY. 

8 (a) IN GENERAL.—Not later than 1 year after the 

9 date of enactment of this Act, the Administrator, in con10 sultation with the Secretary of Energy, the Secretary of 

11 the Interior, and the heads of such other relevant Federal 

12 agencies as the President may designate, shall submit to 

13 Congress a report setting forth a unified and comprehen14 sive strategy to address the key legal, regulatory and other 

15 barriers to the commercial-scale deployment of carbon 

16 capture and sequestration. 

17 (b) BARRIERS.— The report under this section 

18 shall— 

19 (1) identify those regulatory, legal, and other 

20 gaps and barriers that could be addressed by a Fed21 eral agency using existing statutory authority, those, 

22 if any, that require Federal legislation, and those 

23 that would be best addressed at the State, tribal, or 

24 regional level; 


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1 (2) identify regulatory implementation chal2 lenges, including those related to approval of State 

3 and tribal programs and delegation of authority for 

4 permitting; and 

5 (3) recommend rulemakings, Federal legisla6 tion, or other actions that should be taken to further 

7 evaluate and address such barriers. 

8 SEC. 112. REGULATIONS FOR GEOLOGIC SEQUESTRATION 

9 SITES. 

10 (a) COORDINATED CERTIFICATION AND PERMITTING

11 PROCESS.—Title VIII of the Clean Air Act, as added by 

12 section 331 of this Act, is amended by adding after section 

13 812 (as added by section 116 of this Act) the following: 

14 ‘‘SEC. 813. GEOLOGIC SEQUESTRATION SITES. 

15 ‘‘(a) COORDINATED PROCESS.—The Administrator 

16 shall establish a coordinated approach to certifying and 

17 permitting geologic sequestration, taking into consider18 ation all relevant statutory authorities. In establishing 

19 such approach, the Administrator shall— 

20 ‘‘(1) take into account, and reduce redundancy 

21 with, the requirements of section 1421 of the Safe 

22 Drinking Water Act (42 U.S.C. 300h), as amended 

23 by section 112(b) of the American Clean Energy and 

24 Security Act of 2009, including the rulemaking for 


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1 geologic sequestration wells described at 73 Fed. 

2 Reg. 43491-541 (July 25, 2008); and 

3 ‘‘(2) to the extent practicable, reduce the bur4 den on certified entities and implementing authori5 ties. 

6 ‘‘(b) REGULATIONS.—Not later than 2 years after 

7 the date of enactment of this title, the Administrator shall 

8 promulgate regulations to protect human health and the 

9 environment by minimizing the risk of escape to the at10 mosphere of carbon dioxide injected for purposes of geo11 logic sequestration. 

12 ‘‘(c) REQUIREMENTS.—The regulations under sub13 section (b) shall include— 

14 ‘‘(1) a process to obtain certification for geo15 logic sequestration under this section; and 

16 ‘‘(2) requirements for— 

17 ‘‘(A) monitoring, record keeping, and re18 porting for emissions associated with injection 

19 into, and escape from, geologic sequestration 

20 sites, taking into account any requirements or 

21 protocols developed under section 713; 

22 ‘‘(B) public participation in the certifi23 cation process that maximizes transparency; 


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1 ‘‘(C) the sharing of data between States, 

2 Indian tribes, and the Environmental Protec3 tion Agency; and 

4 ‘‘(D) other elements or safeguards nec5 essary to achieve the purpose set forth in sub6 section (b). 

7 ‘‘(d) REPORT.—Not later than 2 years after the pro8 mulgation of regulations under subsection (b), and at 3- 

9 year intervals thereafter, the Administrator shall deliver 

10 to the Committee on Energy and Commerce of the House 

11 of Representatives and the Committee on Environment 

12 and Public Works of the Senate a report on geologic se13 questration in the United States, and, to the extent rel14 evant, other countries in North America. Such report shall 

15 include— 

16 ‘‘(1) data regarding injection, emissions to the 

17 atmosphere, if any, and performance of active and 

18 closed geologic sequestration sites, including those 

19 where enhanced hydrocarbon recovery operations 

20 occur; 

21 ‘‘(2) an evaluation of the performance of rel22 evant Federal environmental regulations and pro23 grams in ensuring environmentally protective geo24 logic sequestration practices; 


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1 ‘‘(3) recommendations on how such programs 

2 and regulations should be improved or made more 

3 effective; and 

4 ‘‘(4) other relevant information.’’. 

5 (b) SAFE DRINKING WATER ACT STANDARDS.—Sec6 tion 1421 of the Safe Drinking Water Act (42 U.S.C. 

7 300h) is amended by inserting after subsection (d) the fol8 lowing: 

9 ‘‘(e) CARBON DIOXIDE GEOLOGIC SEQUESTRATION

10 WELLS.— 

11 ‘‘(1) IN GENERAL.—Not later than 1 year after 

12 the date of enactment of this subsection, the Admin13 istrator shall promulgate regulations under sub14 section (a) for carbon dioxide geologic sequestration 

15 wells. 

16 ‘‘(2) FINANCIAL RESPONSIBILITY.—The regula17 tions referred to in paragraph (1) shall include re18 quirements for maintaining evidence of financial re19 sponsibility, including financial responsibility for 

20 emergency and remedial response, well plugging, site 

21 closure, and post-injection site care. Financial re22 sponsibility may be established for carbon dioxide 

23 geologic sequestration wells in accordance with regu24 lations promulgated by the Administrator by any 

25 one, or any combination, of the following: insurance, 


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1 guarantee, trust, standby trust, surety bond, letter 

2 of credit, qualification as a self-insurer, or any other 

3 method satisfactory to the Administrator.’’. 

4 SEC. 113. STUDIES AND REPORTS. 

5 (a) STUDY OF LEGAL FRAMEWORK FOR GEOLOGIC

6 SEQUESTRATION SITES.— 

7 (1) ESTABLISHMENT OF TASK FORCE.—As 

8 soon as practicable, but not later than 6 months 

9 after the date of enactment of this Act, the Adminis10 trator shall establish a task force to be composed of 

11 an equal number of subject matter experts, non12 governmental organizations with expertise in envi13 ronmental policy, academic experts with expertise in 

14 environmental law, State and tribal officials with en15 vironmental expertise, representatives of State and 

16 tribal Attorneys General, representatives from the 

17 Environmental Protection Agency, the Department 

18 of the Interior, the Department of Energy, the De19 partment of Transportation, and other relevant Fed20 eral agencies, and members of the private sector, to 

21 conduct a study of— 

22 (A) existing Federal environmental stat23 utes, State environmental statutes, and State 

24 common law that apply to geologic sequestra25 tion sites for carbon dioxide, including the abilVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00054 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ity of such laws to serve as risk management 

2 tools; 

3 (B) the existing statutory framework, in4 cluding Federal and State laws, that apply to 

5 harm and damage to the environment or public 

6 health at closed sites where carbon dioxide in7 jection has been used for enhanced hydrocarbon 

8 recovery; 

9 (C) the statutory framework, environ10 mental health and safety considerations, imple11 mentation issues, and financial implications of 

12 potential models for Federal, State, or private 

13 sector assumption of liabilities and financial re14 sponsibilities with respect to closed geologic se15 questration sites; 

16 (D) private sector mechanisms, including 

17 insurance and bonding, that may be available to 

18 manage environmental, health and safety risk 

19 from closed geologic sequestration sites; and 

20 (E) the subsurface mineral rights, water 

21 rights, or property rights issues associated with 

22 geologic sequestration of carbon dioxide, includ23 ing issues specific to Federal lands. 

24 (2) REPORT.—Not later than 18 months after 

25 the date of enactment of this Act, the task force esVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00055 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tablished under paragraph (1) shall submit to Con2 gress a report describing the results of the study 

3 conducted under that paragraph including any con4 sensus recommendations of the task force. 

5 (b) ENVIRONMENTAL STATUTES.— 

6 (1) STUDY.—The Administrator shall conduct a 

7 study examining how, and under what cir8 cumstances, the environmental statutes for which 

9 the Environmental Protection Agency has responsi10 bility would apply to carbon dioxide injection and 

11 geologic sequestration activities. 

12 (2) REPORT.—Not later than 1 year after the 

13 date of enactment of this Act, the Administrator 

14 shall submit to Congress a report describing the re15 sults of the study conducted under paragraph (1). 

16 SEC. 114. CARBON CAPTURE AND SEQUESTRATION DEM17 ONSTRATION AND EARLY DEPLOYMENT PRO18 GRAM. 

19 (a) DEFINITIONS.—For purposes of this section: 

20 (1) SECRETARY.—The term ‘‘Secretary’’ means 

21 the Secretary of Energy. 

22 (2) DISTRIBUTION UTILITY.—The term ‘‘dis23 tribution utility’’ means an entity that distributes 

24 electricity directly to retail consumers under a legal, 

25 regulatory, or contractual obligation to do so. 


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1 (3) ELECTRIC UTILITY.—The term ‘‘electric 

2 utility’’ has the meaning provided by section 3(22) 

3 of the Federal Power Act (16 U.S.C. 796(22)). 

4 (4) FOSSIL FUEL-BASED ELECTRICITY.—The 

5 term ‘‘fossil fuel-based electricity’’ means electricity 

6 that is produced from the combustion of fossil fuels. 

7 (5) FOSSIL FUEL.—The term ‘‘fossil fuel’’ 

8 means coal, petroleum, natural gas or any derivative 

9 of coal, petroleum, or natural gas. 

10 (6) CORPORATION.—The term ‘‘Corporation’’ 

11 means the Carbon Storage Research Corporation es12 tablished in accordance with this section. 

13 (7) QUALIFIED INDUSTRY ORGANIZATION.—The 

14 term ‘‘qualified industry organization’’ means the 

15 Edison Electric Institute, the American Public 

16 Power Association, the National Rural Electric Co17 operative Association, a successor organization of 

18 such organizations, or a group of owners or opera19 tors of distribution utilities delivering fossil fuel20 based electricity who collectively represent at least 

21 20 percent of the volume of fossil fuel-based elec22 tricity delivered by distribution utilities to consumers 

23 in the United States. 

24 (8) RETAIL CONSUMER.—The term ‘‘retail con25 sumer’’ means an end-user of electricity. 


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1 (b) CARBON STORAGE RESEARCH CORPORATION.— 

2 (1) ESTABLISHMENT.— 

3 (A) REFERENDUM.—Qualified industry or4 ganizations may conduct, at their own expense, 

5 a referendum among the owners or operators of 

6 distribution utilities delivering fossil fuel-based 

7 electricity for the creation of a Carbon Storage 

8 Research Corporation. Such referendum shall 

9 be conducted by an independent auditing firm 

10 agreed to by the qualified industry organiza11 tions. Voting rights in such referendum shall be 

12 based on the quantity of fossil fuel-based elec13 tricity delivered to consumers in the previous 

14 calendar year or other representative period as 

15 determined by the Secretary pursuant to sub16 section (f). Upon approval of those persons rep17 resenting two-thirds of the total quantity of fos18 sil fuel-based electricity delivered to retail con19 sumers, the Corporation shall be established un20 less opposed by the State regulatory authorities 

21 pursuant to subparagraph (B). All distribution 

22 utilities voting in the referendum shall certify to 

23 the independent auditing firm the quantity of 

24 fossil fuel-based electricity represented by their 

25 vote. 


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1 (B) STATE REGULATORY AUTHORITIES.— 

2 Upon its own motion or the petition of a quali3 fied industry organization, each State regu4 latory authority shall consider its support or op5 position to the creation of the Corporation 

6 under subparagraph (A). State regulatory au7 thorities may notify the independent auditing 

8 firm referred to in subparagraph (A) of their 

9 views on the creation of the Corporation within 

10 180 days after the date of enactment of this 

11 Act. If 40 percent or more of the State regu12 latory authorities submit to the independent au13 diting firm written notices of opposition, the 

14 Corporation shall not be established notwith15 standing the approval of the qualified industry 

16 organizations as provided in subparagraph (A). 

17 (2) TERMINATION.—The Corporation shall be 

18 authorized to collect assessments and conduct oper19 ations pursuant to this section for a 10-year period 

20 from the date 6 months after the date of enactment 

21 of this Act. After such 10-year period, the Corpora22 tion is no longer authorized to collect assessments 

23 and shall be dissolved on the date 15 years after 

24 such date of enactment, unless the period is ex25 tended by an Act of Congress. 


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1 (3) GOVERNANCE.—The Corporation shall oper2 ate as a division or affiliate of the Electric Power 

3 Research Institute (referred to in this section as 

4 ‘‘EPRI’’) and be managed by a Board of not more 

5 than 15 voting members responsible for its oper6 ations, including compliance with this section. EPRI, 

7 in consultation with the Edison Electric Institute, 

8 the American Public Power Association and the Na9 tional Rural Electric Cooperative Association shall 

10 appoint the Board members under clauses (i), (ii), 

11 and (iii) of subparagraph (A) from among can12 didates recommended by those organizations. At 

13 least a majority of the Board members appointed by 

14 EPRI shall be representatives of distribution utilities 

15 subject to assessments under subsection (d). 

16 (A) MEMBERS.—The Board shall include 

17 at least one representative of each of the fol18 lowing: 

19 (i) Investor-owned utilities. 

20 (ii) Utilities owned by a State agency, 

21 a municipality, and an Indian tribe. 

22 (iii) Rural electric cooperatives. 

23 (iv) Fossil fuel producers. 

24 (v) Nonprofit environmental organiza25 tions. 


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1 (vi) Independent generators or whole2 sale power providers. 

3 (vii) Consumer groups. 

4 (B) NONVOTING MEMBERS.—The Board 

5 shall also include as additional nonvoting Mem6 bers the Secretary of Energy or his designee 

7 and 2 representatives of State regulatory au8 thorities as defined in section 3(17) of the Pub9 lic Utility Regulatory Policies Act of 1978 (16 

10 U.S.C. 2602(17)), each designated by the Na11 tional Association of State Regulatory Utility 

12 Commissioners from States that are not within 

13 the same transmission interconnection. 

14 (4) COMPENSATION.—Corporation Board mem15 bers shall receive no compensation for their services, 

16 nor shall Corporation Board members be reimbursed 

17 for expenses relating to their service. 

18 (5) TERMS.—Corporation Board members shall 

19 serve terms of 4 years and may serve not more than 

20 2 full consecutive terms. Members filling unexpired 

21 terms may serve not more than a total of 8 consecu22 tive years. Former members of the Corporation 

23 Board may be reappointed to the Corporation Board 

24 if they have not been members for a period of 2 

25 years. Initial appointments to the Corporation Board 


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1 shall be for terms of 1, 2, 3, and 4 years, staggered 

2 to provide for the selection of 3 members each year. 

3 (6) STATUS OF CORPORATION.—The Corpora4 tion shall not be considered to be an agency, depart5 ment, or instrumentality of the United States, and 

6 no officer or director or employee of the Corporation 

7 shall be considered to be an officer or employee of 

8 the United States Government, for purposes of title 

9 5 or title 31 of the United States Code, or for any 

10 other purpose, and no funds of the Corporation shall 

11 be treated as public money for purposes of chapter 

12 33 of title 31, United States Code, or for any other 

13 purpose. 

14 (c) FUNCTIONS AND ADMINISTRATION OF THE COR15 PORATION.— 

16 (1) IN GENERAL.—The Corporation shall estab17 lish and administer a program to accelerate the com18 mercial availability of carbon dioxide capture and 

19 storage technologies and methods, including tech20 nologies which capture and store, or capture and 

21 convert, carbon dioxide. Under such program com22 petitively awarded grants, contracts, and financial 

23 assistance shall be provided and entered into with el24 igible entities. Except as provided in paragraph (8), 

25 the Corporation shall use all funds derived from asVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00062 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 sessments under subsection (d) to issue grants and 

2 contracts to eligible entities. 

3 (2) PURPOSE.—The purposes of the grants, 

4 contracts, and assistance under this subsection shall 

5 be to support commercial-scale demonstrations of 

6 carbon capture or storage technology projects capa7 ble of advancing the technologies to commercial 

8 readiness. Such projects should encompass a range 

9 of different coal and other fossil fuel varieties, be 

10 geographically diverse, involve diverse storage media, 

11 and employ capture or storage, or capture and con12 version, technologies potentially suitable either for 

13 new or for retrofit applications. The Corporation 

14 shall seek, to the extent feasible, to support at least 

15 5 commercial-scale demonstration projects inte16 grating carbon capture and sequestration or conver17 sion technologies. 

18 (3) ELIGIBLE ENTITIES.—Entities eligible for 

19 grants, contracts or assistance under this subsection 

20 may include distribution utilities, electric utilities 

21 and other private entities, academic institutions, na22 tional laboratories, Federal research agencies, State 

23 and tribal research agencies, nonprofit organizations, 

24 or consortiums of 2 or more entities. Pilot-scale and 

25 similar small-scale projects are not eligible for supVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00063 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 port by the Corporation. Owners or developers of 

2 projects supported by the Corporation shall, where 

3 appropriate, share in the costs of such projects. 

4 (4) GRANTS FOR EARLY MOVERS.—Fifty per5 cent of the funds raised under this section shall be 

6 provided in the form of grants to electric utilities 

7 that had, prior to the award of any grant under this 

8 section, committed resources to deploy a large scale 

9 electricity generation unit with integrated carbon 

10 capture and sequestration or conversion applied to a 

11 substantial portion of the unit’s carbon dioxide emis12 sions. Grant funds shall be provided to defray costs 

13 incurred by such electricity utilities for at least 5 

14 such electricity generation units. 

15 (5) ADMINISTRATION.—The members of the 

16 Board of Directors of the Corporation shall elect a 

17 Chairman and other officers as necessary, may es18 tablish committees and subcommittees of the Cor19 poration, and shall adopt rules and bylaws for the 

20 conduct of business and the implementation of this 

21 section. The Board shall appoint an Executive Di22 rector and professional support staff who may be 

23 employees of the Electric Power Research Institute 

24 (EPRI). After consultation with the Technical Advi25 sory Committee established under subsection (j), the 


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1 Secretary, and the Director of the National Energy 

2 Technology Laboratory to obtain advice and rec3 ommendations on plans, programs, and project selec4 tion criteria, the Board shall establish priorities for 

5 grants, contracts, and assistance; publish requests 

6 for proposals for grants, contracts, and assistance; 

7 and award grants, contracts, and assistance competi8 tively, on the basis of merit, after the establishment 

9 of procedures that provide for scientific peer review 

10 by the Technical Advisory Committee. The Board 

11 shall give preference to applications that reflect the 

12 best overall value and prospect for achieving the 

13 purposes of the section, such as those which dem14 onstrate an integrated approach for capture and 

15 storage or capture and conversion technologies. The 

16 Board members shall not participate in making 

17 grants or awards to entities with whom they are af18 filiated. 

19 (6) USES OF GRANTS, CONTRACTS, AND ASSIST20 ANCE.—A grant, contract, or other assistance pro21 vided under this subsection may be used to purchase 

22 carbon dioxide when needed to conduct tests of car23 bon dioxide storage sites, in the case of established 

24 projects that are storing carbon dioxide emissions, or 

25 for other purposes consistent with the purposes of 


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1 this section. The Corporation shall make publicly 

2 available at no cost information learned as a result 

3 of projects which it supports financially. 

4 (7) INTELLECTUAL PROPERTY.—The Board 

5 shall establish policies regarding the ownership of in6 tellectual property developed as a result of Corpora7 tion grants and other forms of technology support. 

8 Such policies shall encourage individual ingenuity 

9 and invention. 

10 (8) ADMINISTRATIVE EXPENSES.—Up to 5 per11 cent of the funds collected in any fiscal year under 

12 subsection (d) may be used for the administrative 

13 expenses of operating the Corporation (not including 

14 costs incurred in the determination and collection of 

15 the assessments pursuant to subsection (d)). 

16 (9) PROGRAMS AND BUDGET.—Before August 1 

17 each year, the Corporation, after consulting with the 

18 Technical Advisory Committee and the Secretary 

19 and the Director of the Department’s National En20 ergy Technology Laboratory and other interested 

21 parties to obtain advice and recommendations, shall 

22 publish for public review and comment its proposed 

23 plans, programs, project selection criteria, and 

24 projects to be funded by the Corporation for the 

25 next calendar year. The Corporation shall also pubVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00066 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 lish for public review and comment a budget plan for 

2 the next calendar year, including the probable costs 

3 of all programs, projects, and contracts and a rec4 ommended rate of assessment sufficient to cover 

5 such costs. The Secretary may recommend programs 

6 and activities the Secretary considers appropriate. 

7 The Corporation shall include in the first publication 

8 it issues under this paragraph a strategic plan or 

9 roadmap for the achievement of the purposes of the 

10 Corporation, as set forth in paragraph (2). 

11 (10) RECORDS; AUDITS.—The Corporation shall 

12 keep minutes, books, and records that clearly reflect 

13 all of the acts and transactions of the Corporation 

14 and make public such information. The books of the 

15 Corporation shall be audited by a certified public ac16 countant at least once each fiscal year and at such 

17 other times as the Corporation may designate. Cop18 ies of each audit shall be provided to the Congress, 

19 all Corporation board members, all qualified indus20 try organizations, each State regulatory authority 

21 and, upon request, to other members of the industry. 

22 If the audit determines that the Corporation’s prac23 tices fail to meet generally accepted accounting prin24 ciples the assessment collection authority of the Cor25 poration under subsection (d) shall be suspended 


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1 until a certified public accountant renders a subse2 quent opinion that the failure has been corrected. 

3 The Corporation shall make its books and records 

4 available for review by the Secretary or the Comp5 troller General of the United States. 

6 (11) PUBLIC ACCESS.—The Corporation 

7 Board’s meetings shall be open to the public and 

8 shall occur after at least 30 days advance public no9 tice. Meetings of the Board of Directors may be 

10 closed to the public where the agenda of such meet11 ings includes only confidential matters pertaining to 

12 project selection, the award of grants or contracts, 

13 personnel matters, or the receipt of legal advice. The 

14 minutes of all meetings of the Corporation shall be 

15 made available to and readily accessible by the pub16 lic. 

17 (12) ANNUAL REPORT.—Each year the Cor18 poration shall prepare and make publicly available a 

19 report which includes an identification and descrip20 tion of all programs and projects undertaken by the 

21 Corporation during the previous year. The report 

22 shall also detail the allocation or planned allocation 

23 of Corporation resources for each such program and 

24 project. The Corporation shall provide its annual re25 port to the Congress, the Secretary, each State reguVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00068 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 latory authority, and upon request to the public. The 

2 Secretary shall, not less than 60 days after receiving 

3 such report, provide to the President and Congress 

4 a report assessing the progress of the Corporation in 

5 meeting the objectives of this section. 

6 (d) ASSESSMENTS.— 

7 (1) AMOUNT.—(A) In all calendar years fol8 lowing its establishment, the Corporation shall col9 lect an assessment on distribution utilities for all 

10 fossil fuel-based electricity delivered directly to retail 

11 consumers (as determined under subsection (f)). The 

12 assessments shall reflect the relative carbon dioxide 

13 emission rates of different fossil fuel-based elec14 tricity, and initially shall be not less than the fol15 lowing amounts for coal, natural gas, and oil: 

Fuel type Rate of assessment 

per kilowatt hour 

Coal ................................................................... $0.00043 

Natural Gas ...................................................... $0.00022 

Oil ..................................................................... $0.00032. 

16 (B) The Corporation is authorized to adjust the 

17 assessments on fossil fuel-based electricity to reflect 

18 changes in the expected quantities of such electricity 

19 from different fuel types, such that the assessments 

20 generate not less than $1.0 billion and not more 

21 than $1.1 billion annually. The Corporation is auVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00069 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 thorized to supplement assessments through addi2 tional financial commitments. 

3 (2) INVESTMENT OF FUNDS.—Pending dis4 bursement pursuant to a program, plan, or project, 

5 the Corporation may invest funds collected through 

6 assessments under this subsection, and any other 

7 funds received by the Corporation, only in obliga8 tions of the United States or any agency thereof, in 

9 general obligations of any State or any political sub10 division thereof, in any interest-bearing account or 

11 certificate of deposit of a bank that is a member of 

12 the Federal Reserve System, or in obligations fully 

13 guaranteed as to principal and interest by the 

14 United States. 

15 (3) REVERSION OF UNUSED FUNDS.—If the 

16 Corporation does not disburse, dedicate or assign 75 

17 percent or more of the available proceeds of the as18 sessed fees in any calendar year 7 or more years fol19 lowing its establishment, due to an absence of quali20 fied projects or similar circumstances, it shall reim21 burse the remaining undedicated or unassigned bal22 ance of such fees, less administrative and other ex23 penses authorized by this section, to the distribution 

24 utilities upon which such fees were assessed, in pro25 portion to their collected assessments. 


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1 (e) ERCOT.— 

2 (1) ASSESSMENT, COLLECTION, AND REMIT3 TANCE.—(A) Notwithstanding any other provision of 

4 this section, within ERCOT, the assessment pro5 vided for in subsection (d) shall be— 

6 (i) levied directly on qualified scheduling 

7 entities, or their successor entities; 

8 (ii) charged consistent with other charges 

9 imposed on qualified scheduling entities as a fee 

10 on energy used by the load-serving entities; and 

11 (iii) collected and remitted by ERCOT to 

12 the Corporation in the amounts and in the 

13 same manner as set forth in subsection (d). 

14 (B) The assessment amounts referred to in sub15 paragraph (A) shall be— 

16 (i) determined by the amount and types of 

17 fossil fuel-based electricity delivered directly to 

18 all retail customers in the prior calendar year 

19 beginning with the year ending immediately 

20 prior to the period described in subsection 

21 (b)(2); and 

22 (ii) take into account the number of renew23 able energy credits retired by the load-serving 

24 entities represented by a qualified scheduling 

25 entity within the prior calendar year. 


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1 (2) ADMINISTRATION EXPENSES.—Up to 1 per2 cent of the funds collected in any fiscal year by 

3 ERCOT under the provisions of this subsection may 

4 be used for the administrative expenses incurred in 

5 the determination, collection and remittance of the 

6 assessments to the Corporation. 

7 (3) AUDIT.—ERCOT shall provide a copy of its 

8 annual audit pertaining to the administration of the 

9 provisions of this subsection to the Corporation. 

10 (4) DEFINITIONS.—For the purposes of this 

11 subsection: 

12 (A) The term ‘‘ERCOT’’ means the Elec13 tric Reliability Council of Texas. 

14 (B) The term ‘‘load-serving entities’’ has 

15 the meaning adopted by ERCOT Protocols and 

16 in effect on the date of enactment of this Act. 

17 (C) The term ‘‘qualified scheduling enti18 ties’’ has the meaning adopted by ERCOT Pro19 tocols and in effect on the date of enactment of 

20 this Act. 

21 (D) The term ‘‘renewable energy credit’’ 

22 has the meaning as promulgated and adopted 

23 by the Public Utility Commission of Texas pur24 suant to section 39.904(b) of the Public Utility 


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1 Regulatory Act of 1999, and in effect on the 

2 date of enactment of this Act. 

3 (f) DETERMINATION OF FOSSIL FUEL-BASED ELEC4 TRICITY DELIVERIES.— 

5 (1) FINDINGS.—The Congress finds that: 

6 (A) The assessments under subsection (d) 

7 are to be collected based on the amount of fossil 

8 fuel-based electricity delivered by each distribu9 tion utility. 

10 (B) Since many distribution utilities pur11 chase all or part of their retail consumer’s elec12 tricity needs from other entities, it may not be 

13 practical to determine the precise fuel mix for 

14 the power sold by each individual distribution 

15 utility. 

16 (C) It may be necessary to use average 

17 data, often on a regional basis with reference to 

18 Regional Transmission Organization (‘‘RTO’’) 

19 or NERC regions, to make the determinations 

20 necessary for making assessments. 

21 (2) DOE PROPOSED RULE.—The Secretary, 

22 acting in close consultation with the Energy Infor23 mation Administration, shall issue for notice and 

24 comment a proposed rule to determine the level of 

25 fossil fuel electricity delivered to retail customers by 


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1 each distribution utility in the United States during 

2 the most recent calendar year or other period deter3 mined to be most appropriate. Such proposed rule 

4 shall balance the need to be efficient, reasonably pre5 cise, and timely, taking into account the nature and 

6 cost of data currently available and the nature of 

7 markets and regulation in effect in various regions 

8 of the country. Different methodologies may be ap9 plied in different regions if appropriate to obtain the 

10 best balance of such factors. 

11 (3) FINAL RULE.—Within 6 months after the 

12 date of enactment of this Act, and after opportunity 

13 for comment, the Secretary shall issue a final rule 

14 under this subsection for determining the level and 

15 type of fossil fuel-based electricity delivered to retail 

16 customers by each distribution utility in the United 

17 States during the appropriate period. In issuing 

18 such rule, the Secretary may consider opportunities 

19 and costs to develop new data sources in the future 

20 and issue recommendations for the Energy Informa21 tion Administration or other entities to collect such 

22 data. After notice and opportunity for comment the 

23 Secretary may, by rule, subsequently update and 

24 modify the methodology for making such determina25 tions. 


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1 (4) ANNUAL DETERMINATIONS.—Pursuant to 

2 the final rule issued under paragraph (3), the Sec3 retary shall make annual determinations of the 

4 amounts and types for each such utility and publish 

5 such determinations in the Federal Register. Such 

6 determinations shall be used to conduct the ref7 erendum under subsection (b) and by the Corpora8 tion in applying any assessment under this sub9 section. 

10 (5) REHEARING AND JUDICIAL REVIEW.—The 

11 owner or operator of any distribution utility that be12 lieves that the Secretary has misapplied the method13 ology in the final rule in determining the amount 

14 and types of fossil fuel electricity delivered by such 

15 distribution utility may seek rehearing of such deter16 mination within 30 days of publication of the deter17 mination in the Federal Register. The Secretary 

18 shall decide such rehearing petitions within 30 days. 

19 The Secretary’s determinations following rehearing 

20 shall be final and subject to judicial review in the 

21 United States Court of Appeals for the District of 

22 Columbia. 

23 (g) COMPLIANCE WITH CORPORATION ASSESS24 MENTS.—The Corporation may bring an action in the ap25 propriate court of the United States to compel compliance 


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1 with an assessment levied by the Corporation under this 

2 section. A successful action for compliance under this sub3 section may also require payment by the defendant of the 

4 costs incurred by the Corporation in bringing such action. 

5 (h) MIDCOURSE REVIEW.—Not later than 5 years 

6 following establishment of the Corporation, the Comp7 troller General of the United States shall prepare an anal8 ysis, and report to Congress, assessing the Corporation’s 

9 activities, including project selection and methods of dis10 bursement of assessed fees, impacts on the prospects for 

11 commercialization of carbon capture and storage tech12 nologies, adequacy of funding, and administration of 

13 funds. The report shall also make such recommendations 

14 as may be appropriate in each of these areas. The Cor15 poration shall reimburse the Government Accountability 

16 Office for the costs associated with performing this mid17 course review. 

18 (i) RECOVERY OF COSTS.— 

19 (1) IN GENERAL.—A distribution utility whose 

20 transmission, delivery, or sales of electric energy are 

21 subject to any form of rate regulation shall not be 

22 denied the opportunity to recover the full amount of 

23 the prudently incurred costs associated with com24 plying with this section, consistent with applicable 

25 State or Federal law. 


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1 (2) RATEPAYER REBATES.—Regulatory authori2 ties that approve cost recovery pursuant to para3 graph (1) may order rebates to ratepayers to the ex4 tent that distribution utilities are reimbursed 

5 undedicated or unassigned balances pursuant to sub6 section (d)(3). 

7 (j) TECHNICAL ADVISORY COMMITTEE.— 

8 (1) ESTABLISHMENT.—There is established an 

9 advisory committee, to be known as the ‘‘Technical 

10 Advisory Committee’’. 

11 (2) MEMBERSHIP.—The Technical Advisory 

12 Committee shall be comprised of not less than 7 

13 members appointed by the Board from among aca14 demic institutions, national laboratories, independent 

15 research institutions, and other qualified institu16 tions. No member of the Committee shall be affili17 ated with EPRI or with any organization having 

18 members serving on the Board. At least one member 

19 of the Committee shall be appointed from among of20 ficers or employees of the Department of Energy 

21 recommended to the Board by the Secretary of En22 ergy. 

23 (3) CHAIRPERSON AND VICE CHAIRPERSON.— 

24 The Board shall designate one member of the Tech25 nical Advisory Committee to serve as Chairperson of 


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1 the Committee and one to serve as Vice Chairperson 

2 of the Committee. 

3 (4) COMPENSATION.—The Board shall provide 

4 compensation to members of the Technical Advisory 

5 Committee for travel and other incidental expenses 

6 and such other compensation as the Board deter7 mines to be necessary. 

8 (5) PURPOSE.—The Technical Advisory Com9 mittee shall provide independent assessments and 

10 technical evaluations, as well as make non-binding 

11 recommendations to the Board, concerning Corpora12 tion activities, including but not limited to the fol13 lowing: 

14 (A) Reviewing and evaluating the Corpora15 tion’s plans and budgets described in subsection 

16 (c)(9), as well as any other appropriate areas, 

17 which could include approaches to prioritizing 

18 technologies, appropriateness of engineering 

19 techniques, monitoring and verification tech20 nologies for storage, geological site selection, 

21 and cost control measures. 

22 (B) Making annual non-binding rec23 ommendations to the Board concerning any of 

24 the matters referred to in subparagraph (A), as 

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1 search, or engineering practices would best fur2 ther the goals of the Corporation. 

3 (6) PUBLIC AVAILABILITY.—All reports, evalua4 tions, and other materials of the Technical Advisory 

5 Committee shall be made available to the public by 

6 the Board, without charge, at time of receipt by the 

7 Board. 

8 (k) LOBBYING RESTRICTIONS.—No funds collected 

9 by the Corporation shall be used in any manner for influ10 encing legislation or elections, except that the Corporation 

11 may recommend to the Secretary and the Congress 

12 changes in this section or other statutes that would fur13 ther the purposes of this section. 

14 (l) DAVIS-BACON COMPLIANCE.—The Corporation 

15 shall ensure that entities receiving grants, contracts, or 

16 other financial support from the Corporation for the 

17 project activities authorized by this section are in compli18 ance with the Davis-Bacon Act (40 U.S.C. 276a–276a– 

19 5). 

20 SEC. 115. COMMERCIAL DEPLOYMENT OF CARBON CAP21 TURE AND SEQUESTRATION TECHNOLOGIES. 

22 Part H of title VII of the Clean Air Act (as added 

23 by section 321 of this Act) is amended by adding the fol24 lowing new section after section 785: 


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1 ‘‘SEC. 786. COMMERCIAL DEPLOYMENT OF CARBON CAP2 TURE AND SEQUESTRATION TECHNOLOGIES. 

3 ‘‘(a) REGULATIONS.—Not later than 2 years after 

4 the date of enactment of this title, the Administrator shall 

5 promulgate regulations providing for the distribution of 

6 emission allowances allocated pursuant to section 782(f), 

7 pursuant to the requirements of this section, to support 

8 the commercial deployment of carbon capture and seques9 tration technologies in both electric power generation and 

10 industrial operations. 

11 ‘‘(b) ELIGIBILITY CRITERIA.—For an owner or oper12 ator of a project to be eligible to receive emission allow13 ances under this section, the project must— 

14 ‘‘(1) implement carbon capture and sequestra15 tion technology— 

16 ‘‘(A) at an electric generating unit that— 

17 ‘‘(i) has a nameplate capacity of 200 

18 megawatts or more; 

19 ‘‘(ii) in the case of a retrofit applica20 tion, applies the carbon capture and se21 questration technology to the flue gas from 

22 at least 200 megawatts of the total name23 plate generating capacity of the unit, pro24 vided that clause (i) shall apply without ex25 ception; 


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1 ‘‘(iii) derives at least 50 percent of its 

2 annual fuel input from coal, petroleum 

3 coke, or any combination of these 2 fuels; 

4 and 

5 ‘‘(iv) upon implementation of capture 

6 and sequestration technology, will achieve 

7 an emission limit that is at least a 50 per8 cent reduction in emissions of the carbon 

9 dioxide produced by— 

10 ‘‘(I) the unit, measured on an 

11 annual basis, determined in accord12 ance with section 812(b)(2); or 

13 ‘‘(II) in the case of retrofit appli14 cations under clause (ii), the treated 

15 portion of flue gas from the unit, 

16 measured on an annual basis, deter17 mined in accordance with section 

18 812(b)(2); or 

19 ‘‘(B) at an industrial source that— 

20 ‘‘(i) absent carbon capture and se21 questration, would emit greater than 

22 50,000 tons per year of carbon dioxide; 

23 ‘‘(ii) upon implementation, will 

24 achieve an emission limit that is at least a 

25 50 percent reduction in emissions of the 


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1 carbon dioxide produced by the emission 

2 point, measured on an annual basis, deter3 mined in accordance with section 

4 812(b)(2); and 

5 ‘‘(iii) does not produce a liquid trans6 portation fuel from a solid fossil-based 

7 feedstock; 

8 ‘‘(2) geologically sequester carbon dioxide at a 

9 site that meets all applicable permitting and certifi10 cation requirements for geologic sequestration, or, 

11 pursuant to such requirements as the Administrator 

12 may prescribe by regulation, convert captured car13 bon dioxide to a stable form that will safely and per14 manently sequester such carbon dioxide; 

15 ‘‘(3) meet all other applicable State, tribal, and 

16 Federal permitting requirements; and 

17 ‘‘(4) be located in the United States. 

18 ‘‘(c) PHASE I DISTRIBUTION TO ELECTRIC GENER19 ATING UNITS.— 

20 ‘‘(1) APPLICATION.—This subsection shall 

21 apply only to projects at the first 6 gigawatts of 

22 electric generating units, measured in cumulative 

23 generating capacity of such units, that receive allow24 ances under this section. 


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1 ‘‘(2) DISTRIBUTION.—The Administrator shall 

2 distribute emission allowances allocated under sec3 tion 782(f) to the owner or operator of each eligible 

4 project at an electric generating unit in a quantity 

5 equal to the quotient obtained by dividing— 

6 ‘‘(A) the product obtained by multi7 plying— 

8 ‘‘(i) the number of metric tons of car9 bon dioxide emissions avoided through cap10 ture and sequestration of emissions by the 

11 project, as determined pursuant to such 

12 methodology as the Administrator shall 

13 prescribe by regulation; and 

14 ‘‘(ii) a bonus allowance value, pursu15 ant to paragraph (3); by 

16 ‘‘(B) the average fair market value of an 

17 emission allowance during the preceding year. 

18 ‘‘(3) BONUS ALLOWANCE VALUES.— 

19 ‘‘(A) For a generating unit achieving the 

20 capture and sequestration of 85 percent or 

21 more of the carbon dioxide that otherwise would 

22 be emitted by such unit, the bonus allowance 

23 value shall be $90 per ton. 

24 ‘‘(B) The Administrator shall by regulation 

25 establish a bonus allowance value for each rate 


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1 of lower capture and sequestration achieved by 

2 a generating unit, from a minimum of $50 per 

3 ton for a 50 percent rate and varying directly 

4 with increasing rates of capture and sequestra5 tion up to $90 per ton for an 85 percent rate. 

6 ‘‘(C) For a generating unit that achieves 

7 the capture and sequestration of at least 50 

8 percent of the carbon dioxide that otherwise 

9 would be emitted by such unit by not later than 

10 January 1, 2017, the otherwise applicable 

11 bonus allowance value under this paragraph 

12 shall be increased by $10, provided that the 

13 owner of such unit notifies the Administrator 

14 by not later than January 1, 2012, of its intent 

15 to achieve such rate of capture and sequestra16 tion. 

17 ‘‘(D) For a carbon capture and sequestra18 tion project sequestering in a geological forma19 tion for purposes of enhanced hydrocarbon re20 covery, the Administrator shall, by regulation, 

21 reduce the applicable bonus allowance value 

22 under this paragraph to reflect the lower net 

23 cost of the project when compared to sequestra24 tion into geological formations solely for pur25 poses of sequestration. 


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1 ‘‘(E) The Administrator shall annually ad2 just for inflation the bonus allowance values es3 tablished under this paragraph. 

4 ‘‘(d) PHASE II DISTRIBUTION TO ELECTRIC GENER5 ATING UNITS.— 

6 ‘‘(1) APPLICATION.—This subsection shall 

7 apply only to the distribution of emission allowances 

8 for carbon capture and sequestration projects at 

9 electric generating units after the capacity threshold 

10 identified in subsection (c)(1) is reached. 

11 ‘‘(2) REGULATIONS.—Not later than 2 years 

12 prior to the date on which the capacity threshold 

13 identified in subsection (c)(1) is projected to be 

14 reached, the Administrator shall promulgate regula15 tions to govern the distribution of emission allow16 ances to the owners or operators of eligible projects 

17 under this subsection. 

18 ‘‘(3) REVERSE AUCTIONS.— 

19 ‘‘(A) IN GENERAL.—Except as provided in 

20 paragraph (4), the regulations promulgated 

21 under paragraph (2) shall provide for the dis22 tribution of emission allowances to the owners 

23 or operators of eligible projects under this sub24 section through reverse auctions, which shall be 

25 held no less frequently than once each calendar 


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1 year. The Administrator may establish a sepa2 rate auction for each of no more than 5 dif3 ferent project categories, defined on the basis of 

4 coal type, capture technology, geological forma5 tion type, new unit versus retrofit application, 

6 such other factors as the Administrator may 

7 prescribe, or any combination thereof. The Ad8 ministrator may establish appropriate minimum 

9 rates of capture and sequestration in imple10 menting this paragraph. 

11 ‘‘(B) AUCTION PROCESS.—At each reverse 

12 auction— 

13 ‘‘(i) the Administrator shall solicit 

14 bids from eligible projects; 

15 ‘‘(ii) eligible projects participating in 

16 the auction shall submit a bid including 

17 the desired level of carbon dioxide seques18 tration incentive per ton and the estimated 

19 quantity of carbon dioxide that the project 

20 will permanently sequester over 10 years; 

21 and 

22 ‘‘(iii) the Administrator shall select 

23 bids, within each auction, for the seques24 tration amount submitted, beginning with 

25 the eligible project submitting the bid for 


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1 the lowest level of sequestration incentive 

2 on a per ton basis and meeting such other 

3 requirements as the Administrator may 

4 specify, until the amount of funds available 

5 for the reverse auction is committed. 

6 ‘‘(C) FORM OF DISTRIBUTION.—The Ad7 ministrator shall distribute emission allowances 

8 to the owners or operators of eligible projects 

9 selected through a reverse auction under this 

10 paragraph pursuant to a formula equivalent to 

11 that described in subsection (c)(2), except that 

12 the bonus allowance value that is bid by the en13 tity shall be substituted for the bonus allowance 

14 values set forth in subsection (c)(3). 

15 ‘‘(4) ALTERNATIVE DISTRIBUTION METHOD.— 

16 ‘‘(A) IN GENERAL.—If the Administrator 

17 determines that reverse auctions would not pro18 vide for efficient and cost-effective commercial 

19 deployment of carbon capture and sequestration 

20 technologies, the Administrator may instead, 

21 through regulations promulgated under para22 graph (2) or (5), prescribe a schedule for the 

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1 section, in accordance with the requirements of 

2 this paragraph. 

3 ‘‘(B) MULTIPLE TRANCHES.—The Admin4 istrator shall divide emission allowances avail5 able for distribution to the owners or operators 

6 of eligible projects into a series of tranches, 

7 each supporting the deployment of a specified 

8 quantity of cumulative electric generating ca9 pacity utilizing carbon capture and sequestra10 tion technology, each of which shall not be 

11 greater than 6 gigawatts. 

12 ‘‘(C) METHOD OF DISTRIBUTION.—The 

13 Administrator shall distribute emission allow14 ances within each tranche, on a first-come, 

15 first-served basis— 

16 ‘‘(i) based on the date of full-scale op17 eration of capture and sequestration tech18 nology; and 

19 ‘‘(ii) pursuant to a formula, similar to 

20 that set forth in subsection (c)(2) (except 

21 that the Administrator shall prescribe 

22 bonus allowance values different than those 

23 set forth in subsection (c)(3)), establishing 

24 the number of allowances to be distributed 


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1 per ton of carbon dioxide sequestered by 

2 the project. 

3 ‘‘(D) REQUIREMENTS.—For each tranche 

4 established pursuant to subparagraph (B), the 

5 Administrator shall establish a schedule for dis6 tributing emission allowances that— 

7 ‘‘(i) is based on a sliding scale that 

8 provides higher bonus allowance values for 

9 projects achieving higher rates of capture 

10 and sequestration; 

11 ‘‘(ii) for each capture and sequestra12 tion rate, establishes a bonus allowance 

13 value that is lower than that established 

14 for such rate in the previous tranche (or, 

15 in the case of the first tranche, than that 

16 established for such rate under subsection 

17 (c)(3)); and 

18 ‘‘(iii) may establish different bonus al19 lowance levels for no more than 5 different 

20 project categories, defined by coal type, 

21 capture technology, geological formation 

22 type, new unit versus retrofit application, 

23 such other factors as the Administrator 

24 may prescribe, or any combination thereof. 


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1 ‘‘(E) CRITERIA FOR ESTABLISHING BONUS

2 ALLOWANCE VALUES.—In setting bonus allow3 ance values under this paragraph, the Adminis4 trator shall seek to cover no more than the rea5 sonable incremental capital and operating costs 

6 of a project that are attributable to implemen7 tation of carbon capture, transportation, and 

8 sequestration technologies, taking into ac9 count— 

10 ‘‘(i) the reduced cost of compliance 

11 with section 722 of this Act; 

12 ‘‘(ii) the reduced cost associated with 

13 sequestering in a geological formation for 

14 purposes of enhanced hydrocarbon recovery 

15 when compared to sequestration into geo16 logical formations solely for purposes of se17 questration; 

18 ‘‘(iii) the relevant factors defining the 

19 project category; and 

20 ‘‘(iv) such other factors as the Admin21 istrator determines are appropriate. 

22 ‘‘(5) REVISION OF REGULATIONS.—The Admin23 istrator shall review, and as appropriate revise, the 

24 applicable regulations under this subsection no less 

25 frequently than every 8 years. 


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1 ‘‘(e) LIMITS FOR CERTAIN ELECTRIC GENERATING

2 UNITS.— 

3 ‘‘(1) DEFINITIONS.—For purposes of this sub4 section, the terms ‘covered EGU’ and ‘initially per5 mitted’ shall have the meaning given those terms in 

6 section 812 of this Act. 

7 ‘‘(2) COVERED EGUS INITIALLY PERMITTED

8 FROM 2009 THROUGH 2014.—For a covered EGU 

9 that is initially permitted on or after January 1, 

10 2009, and before January 1, 2015, the Adminis11 trator shall reduce the quantity of emission allow12 ances that the owner or operator of such covered 

13 EGU would otherwise be eligible to receive under 

14 this section as follows: 

15 ‘‘(A) In the case of a unit commencing op16 eration on or before January 1, 2019, if the 

17 date in clause (ii)(I) is earlier than the date in 

18 clause (ii)(II), by the product of— 

19 ‘‘(i) 20 percent; and 

20 ‘‘(ii) the number of years, if any, that 

21 have elapsed between— 

22 ‘‘(I) the earlier of January 1, 

23 2020, or the date that is 5 years after 

24 the commencement of operation of 

25 such covered EGU; and 


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1 ‘‘(II) the first year that such cov2 ered EGU achieves (and thereafter 

3 maintains) an emission limit that is at 

4 least a 50 percent reduction in emis5 sions of the carbon dioxide produced 

6 by the unit, measured on an annual 

7 basis, as determined in accordance 

8 with section 812(b)(2). 

9 ‘‘(B) In the case of a unit commencing op10 eration after January 1, 2019, by the product 

11 of— 

12 ‘‘(i) 20 percent; and 

13 ‘‘(ii) the number of years between— 

14 ‘‘(I) the commencement of oper15 ation of such covered EGU; and 

16 ‘‘(II) the first year that such cov17 ered EGU achieves (and thereafter 

18 maintains) an emission limit that is at 

19 least a 50 percent reduction in emis20 sions of the carbon dioxide produced 

21 by the unit, measured on an annual 

22 basis, as determined in accordance 

23 with section 812(b)(2). 

24 ‘‘(3) COVERED EGUS INITIALLY PERMITTED

25 FROM 2015 THROUGH 2019.—The owner or operator 


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1 of a covered EGU that is initially permitted on or 

2 after January 1, 2015, and before January 1, 2020, 

3 shall be ineligible to receive emission allowances pur4 suant to this section if such unit, upon commence5 ment of operations (and thereafter), does not achieve 

6 and maintain an emission limit that is at least a 50 

7 percent reduction in emissions of the carbon dioxide 

8 produced by the unit, measured on an annual basis, 

9 as determined in accordance with section 812(b)(2). 

10 ‘‘(f) INDUSTRIAL SOURCES.— 

11 ‘‘(1) ALLOWANCES.—The Administrator may 

12 distribute not more than 15 percent of the allow13 ances allocated under section 782(f) for any vintage 

14 year to the owners or operators of eligible industrial 

15 sources to support the commercial-scale deployment 

16 of carbon capture and sequestration technologies at 

17 such sources. 

18 ‘‘(2) DISTRIBUTION.—The Administrator shall, 

19 by regulation, prescribe requirements for the dis20 tribution of emission allowances to the owners or op21 erators of industrial sources under this subsection, 

22 based on a bonus allowance formula that awards al23 lowances to qualifying projects on the basis of tons 

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1 tered. The Administrator may provide for the dis2 tribution of emission allowances pursuant to— 

3 ‘‘(A) a reverse auction method, similar to 

4 that described under subsection (d)(3), includ5 ing the use of separate auctions for different 

6 project categories; or 

7 ‘‘(B) an incentive schedule, similar to that 

8 described under subsection (d)(4), which shall 

9 ensure that incentives are set so as to satisfy 

10 the requirement described in subsection 

11 (d)(4)(E). 

12 ‘‘(3) REVISION OF REGULATIONS.—The Admin13 istrator shall review, and as appropriate revise, the 

14 applicable regulations under this subsection no less 

15 frequently than every 8 years. 

16 ‘‘(g) LIMITATIONS.—Allowances may be distributed 

17 under this section only for tons of carbon dioxide emis18 sions that have already been captured and sequestered. A 

19 qualifying project may receive annual emission allowances 

20 under this section only for the first 10 years of operation. 

21 No greater than 72 gigawatts of total cumulative gener22 ating capacity (including industrial applications, measured 

23 by such equivalent metric as the Administrator may des24 ignate) may receive emission allowances under this sec25 tion. Upon reaching the limit described in the preceding 


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1 sentence, any emission allowances that are allocated for 

2 carbon capture and sequestration deployment under sec3 tion 782(f) and are not yet obligated under this section 

4 shall be treated as allowances not designated for distribu5 tion for purposes of section 782(r). 

6 ‘‘(h) EXHAUSTION OF ACCOUNT AND ANNUAL ROLL7 OVER OF SURPLUS ALLOWANCES.— 

8 ‘‘(1) In distributing emission allowances under 

9 this section, the Administrator shall ensure that 

10 qualifying projects receiving allowances receive dis11 tributions for 10 years. 

12 ‘‘(2) If the Administrator determines that the 

13 emission allowances allocated under section 782(f) 

14 with a vintage year that matches the year of dis15 tribution will be exhausted once the estimated full 

16 10-year distributions will be provided to current eli17 gible participants, the Administrator shall provide to 

18 new eligible projects allowances from vintage years 

19 after the year of the distribution. 

20 ‘‘(i) RETROFIT APPLICATIONS.—(1) In calculating 

21 bonus allowance values for retrofit applications eligible 

22 under subsection (b)(1)(A)(ii) and (iv)(II), the Adminis23 trator shall apply the required capture rates with respect 

24 to the treated portion of flue gas from the unit. 


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1 ‘‘(2) No additional projects shall be eligible for allow2 ances under subsection (b)(1)(A)(ii) and (iv)(II) as of such 

3 time as the Administrator reports, pursuant to section 

4 812(d), that carbon capture and sequestration retrofit 

5 projects at electric generating units that are eligible for 

6 allowances under this section have been applied, in the ag7 gregate, to the flue gas generated by 1 gigawatt of total 

8 cumulative generating capacity. 

9 ‘‘(j) DAVIS-BACON COMPLIANCE.—All laborers and 

10 mechanics employed on projects funded directly by or as11 sisted in whole or in part by this section through the use 

12 of emission allowances shall be paid wages at rates not 

13 less than those prevailing on projects of a character simi14 lar in the locality as determined by the Secretary of Labor 

15 in accordance with subchapter IV, chapter 31, part A of 

16 subtitle II of title 40, United States Code. With respect 

17 to the labor standards specified in this subsection, the Sec18 retary of Labor shall have the authority and functions set 

19 forth in Reorganization Plan Numbered 14 of 1950 (64 

20 Stat. 1267; 5 U.S.C. App.) and section 3145 of title 40, 

21 United States Code.’’. 


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1 SEC. 116. PERFORMANCE STANDARDS FOR COAL-FUELED 

2 POWER PLANTS. 

3 (a) IN GENERAL.—Title VIII of the Clean Air Act 

4 (as added by section 331 of this Act) is amended by add5 ing the following new section after section 811: 

6 ‘‘SEC. 812. PERFORMANCE STANDARDS FOR NEW COAL7 FIRED POWER PLANTS. 

8 ‘‘(a) DEFINITIONS.—For purposes of this section: 

9 ‘‘(1) COVERED EGU.—The term ‘covered EGU’ 

10 means a utility unit that is required to have a per11 mit under section 503(a) and is authorized under 

12 state or federal law to derive at least 30 percent of 

13 its annual heat input from coal, petroleum coke, or 

14 any combination of these fuels. 

15 ‘‘(2) INITIALLY PERMITTED.—The term ‘ini16 tially permitted’ means that the owner or operator 

17 has received a Clean Air Act preconstruction ap18 proval or permit, for the covered EGU as a new (not 

19 a modified) source, but administrative review or ap20 peal of such approval or permit has not been ex21 hausted. A subsequent modification of any such ap22 proval or permits, ongoing administrative or court 

23 review, appeals, or challenges, or the existence or 

24 tolling of any time to pursue further review, appeals, 

25 or challenges shall not affect the date on which a 


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1 covered EGU is considered to be initially permitted 

2 under this paragraph. 

3 ‘‘(b) STANDARDS.—(1) A covered EGU that is ini4 tially permitted on or after January 1, 2020, shall achieve 

5 an emission limit that is a 65 percent reduction in emis6 sions of the carbon dioxide produced by the unit, as 

7 measured on an annual basis, or meet such more stringent 

8 standard as the Administrator may establish pursuant to 

9 subsection (c). 

10 ‘‘(2) A covered EGU that is initially permitted after 

11 January 1, 2009, and before January 1, 2020, shall, by 

12 the applicable compliance date established under this 

13 paragraph, achieve an emission limit that is a 50 percent 

14 reduction in emissions of the carbon dioxide produced by 

15 the unit, as measured on an annual basis. Compliance 

16 with the requirement set forth in this paragraph shall be 

17 required by the earliest of the following: 

18 ‘‘(A) Four years after the date the Adminis19 trator has published pursuant to subsection (d) a re20 port that there are in commercial operation in the 

21 United States electric generating units or other sta22 tionary sources equipped with carbon capture and 

23 sequestration technology that, in the aggregate— 

24 ‘‘(i) have a total of at least 4 gigawatts of 

25 nameplate generating capacity of which— 


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1 ‘‘(I) at least 3 gigawatts must be elec2 tric generating units; and 

3 ‘‘(II) up to 1 gigawatt may be indus4 trial applications, for which capture and 

5 sequestration of 3 million tons of carbon 

6 dioxide per year on an aggregate 

7 annualized basis shall be considered equiv8 alent to 1 gigawatt; 

9 ‘‘(ii) include at least 2 electric generating 

10 units, each with a nameplate generating capac11 ity of 250 megawatts or greater, that capture, 

12 inject, and sequester carbon dioxide into geo13 logic formations other than oil and gas fields; 

14 and 

15 ‘‘(iii) are capturing and sequestering in the 

16 aggregate at least 12 million tons of carbon di17 oxide per year, calculated on an aggregate 

18 annualized basis. 

19 ‘‘(B) January 1, 2025. 

20 ‘‘(3) If the deadline for compliance with paragraph 

21 (2) is January 1, 2025, the Administrator may extend the 

22 deadline for compliance by a covered EGU by up to 18 

23 months if the Administrator makes a determination, based 

24 on a showing by the owner or operator of the unit, that 

25 it will be technically infeasible for the unit to meet the 


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1 standard by the deadline. The owner or operator must 

2 submit a request for such an extension by no later than 

3 January 1, 2022, and the Administrator shall provide for 

4 public notice and comment on the extension request. 

5 ‘‘(c) REVIEW AND REVISION OF STANDARDS.—Not 

6 later than 2025 and at 5-year intervals thereafter, the Ad7 ministrator shall review the standards for new covered 

8 EGUs under this section and shall, by rule, reduce the 

9 maximum carbon dioxide emission rate for new covered 

10 EGUs to a rate which reflects the degree of emission limi11 tation achievable through the application of the best sys12 tem of emission reduction which (taking into account the 

13 cost of achieving such reduction and any nonair quality 

14 health and environmental impact and energy require15 ments) the Administrator determines has been adequately 

16 demonstrated. 

17 ‘‘(d) REPORTS.—Not later than the date 18 months 

18 after the date of enactment of this title and semiannually 

19 thereafter, the Administrator shall publish a report on the 

20 nameplate capacity of units (determined pursuant to sub21 section (b)(2)(A)) in commercial operation in the United 

22 States equipped with carbon capture and sequestration 

23 technology, including the information described in sub24 section (b)(2)(A) (including the cumulative generating ca25 pacity to which carbon capture and sequestration retrofit 


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1 projects meeting the criteria described in section 

2 786(b)(1)(A)(ii) and (b)(1)(A)(iv)(II) has been applied 

3 and the quantities of carbon dioxide captured and seques4 tered by such projects). 

5 ‘‘(e) REGULATIONS.—Not later than 2 years after the 

6 date of enactment of this title, the Administrator shall 

7 promulgate regulations to carry out the requirements of 

8 this section.’’. 

9 Subtitle C—Clean Transportation 

10 SEC. 121. ELECTRIC VEHICLE INFRASTRUCTURE. 

11 (a) AMENDMENT OF PURPA.—Section 111(d) of the 

12 Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 

13 2621(d)) is amended by adding at the end the following: 

14 ‘‘(20) PLUG-IN ELECTRIC DRIVE VEHICLE IN15 FRASTRUCTURE.— 

16 ‘‘(A) UTILITY PLAN FOR INFRASTRUC17 TURE.—Each electric utility shall develop a 

18 plan to support the use of plug-in electric drive 

19 vehicles, including heavy-duty hybrid electric ve20 hicles. The plan may provide for deployment of 

21 electrical charging stations in public or private 

22 locations, including street parking, parking ga23 rages, parking lots, homes, gas stations, and 

24 highway rest stops. Any such plan may also in25 clude— 


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1 ‘‘(i) battery exchange, fast charging 

2 infrastructure and other services; 

3 ‘‘(ii) triggers for infrastructure de4 ployment based upon market penetration 

5 of plug-in electric drive vehicles; and 

6 ‘‘(iii) such other elements as the State 

7 determines necessary to support plug-in 

8 electric drive vehicles. 

9 Each plan under this paragraph shall provide 

10 for the deployment of the charging infrastruc11 ture or other infrastructure necessary to ade12 quately support the use of plug-in electric drive 

13 vehicles. 

14 ‘‘(B) SUPPORT REQUIREMENTS.—Each 

15 State regulatory authority (in the case of each 

16 electric utility for which it has ratemaking au17 thority) and each utility (in the case of a non18 regulated utility) shall— 

19 ‘‘(i) require that charging infrastruc20 ture deployed is interoperable with prod21 ucts of all auto manufacturers to the ex22 tent possible; and 

23 ‘‘(ii) consider adopting minimum re24 quirements for deployment of electrical 

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1 priate requirements necessary to support 

2 the use of plug-in electric drive vehicles. 

3 ‘‘(C) COST RECOVERY.—Each State regu4 latory authority (in the case of each electric 

5 utility for which it has ratemaking authority) 

6 and each utility (in the case of a nonregulated 

7 utility) shall consider whether, and to what ex8 tent, to allow cost recovery for plans and imple9 mentation of plans. 

10 ‘‘(D) SMART GRID INTEGRATION.—The 

11 State regulatory authority (in the case of each 

12 electric utility for which it has ratemaking au13 thority) and each utility (in the case of a non14 regulated utility) shall, in accordance with regu15 lations issued by the Federal Energy Regu16 latory Commission pursuant to section 1305(d) 

17 of the Energy Independence and Security Act 

18 of 2007— 

19 ‘‘(i) establish any appropriate proto20 cols and standards for integrating plug-in 

21 electric drive vehicles into an electrical dis22 tribution system, including Smart Grid 

23 systems and devices as described in title 

24 XIII of the Energy Independence and Se25 curity Act of 2007; 


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1 ‘‘(ii) include, to the extent feasible, 

2 the ability for each plug-in electric drive 

3 vehicle to be identified individually and to 

4 be associated with its owner’s electric util5 ity account, regardless of the location that 

6 the vehicle is plugged in, for purposes of 

7 appropriate billing for any electricity re8 quired to charge the vehicle’s batteries as 

9 well as any crediting for electricity pro10 vided to the electric utility from the vehi11 cle’s batteries; and 

12 ‘‘(iii) review the determination made 

13 in response to section 1252 of the Energy 

14 Policy Act of 2005 in light of this section, 

15 including whether time-of-use pricing 

16 should be employed to enable the use of 

17 plug-in electric drive vehicles to contribute 

18 to meeting peak-load and ancillary service 

19 power needs.’’. 

20 (b) COMPLIANCE.— 

21 (1) TIME LIMITATIONS.—Section 112(b) of the 

22 Public Utility Regulatory Policies Act of 1978 (16 

23 U.S.C. 2622(b)) is amended by adding the following 

24 at the end thereof: 


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1 ‘‘(7)(A) Not later than 3 years after the date of en2 actment of this paragraph, each State regulatory authority 

3 (with respect to each electric utility for which it has rate4 making authority) and each nonregulated utility shall 

5 commence the consideration referred to in section 111, or 

6 set a hearing date for consideration, with respect to the 

7 standard established by paragraph (20) of section 111(d). 

8 ‘‘(B) Not later than 4 years after the date of enact9 ment of the this paragraph, each State regulatory author10 ity (with respect to each electric utility for which it has 

11 ratemaking authority), and each nonregulated electric util12 ity, shall complete the consideration, and shall make the 

13 determination, referred to in section 111 with respect to 

14 the standard established by paragraph (20) of section 

15 111(d).’’. 

16 (2) FAILURE TO COMPLY.—Section 112(c) of 

17 the Public Utility Regulatory Policies Act of 1978 

18 (16 U.S.C. 2622(c)) is amended by adding the fol19 lowing at the end: ‘‘In the case of the standards es20 tablished by paragraph (20) of section 111(d), the 

21 reference contained in this subsection to the date of 

22 enactment of this Act shall be deemed to be a ref23 erence to the date of enactment of such paragraph.’’. 

24 (3) PRIOR STATE ACTIONS.—Section 112(d) of 

25 the Public Utility Regulatory Policies Act of 1978 


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1 (16 U.S.C. 2622(d)) is amended by striking ‘‘(19)’’ 

2 and inserting ‘‘(20)’’ before ‘‘of section 111(d)’’. 

3 SEC. 122. LARGE-SCALE VEHICLE ELECTRIFICATION PRO4 GRAM. 

5 (a) DEPLOYMENT PROGRAM.—The Secretary of En6 ergy shall establish a program to deploy and integrate 

7 plug-in electric drive vehicles into the electricity grid in 

8 multiple regions. In carrying out the program, the Sec9 retary may provide financial assistance described under 

10 subsection (d), consistent with the goals under subsection 

11 (b). The Secretary shall select regions based upon applica12 tions for assistance received pursuant to subsection (c). 

13 (b) GOALS.—The goals of the program established 

14 pursuant to subsection (a) shall be— 

15 (1) to demonstrate the viability of a vehicle16 based transportation system that is not overly de17 pendent on petroleum as a fuel and contributes to 

18 lower carbon emissions than a system based on con19 ventional vehicles; 

20 (2) to facilitate the integration of advanced ve21 hicle technologies into electricity distribution areas 

22 to improve system performance and reliability; 

23 (3) to demonstrate the potential benefits of co24 ordinated investments in vehicle electrification on 

25 personal mobility and a regional grid; 


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1 (4) to demonstrate protocols and standards that 

2 facilitate vehicle integration into the grid; and 

3 (5) to investigate differences in each region and 

4 regulatory environment regarding best practices in 

5 implementing vehicle electrification. 

6 (c) APPLICATIONS.—Any State, Indian tribe, or local 

7 government (or group of State, Indian tribe, or local gov8 ernments) may apply to the Secretary of Energy for finan9 cial assistance in furthering the regional deployment and 

10 integration into the electricity grid of plug-in electric drive 

11 vehicles. Such applications may be jointly sponsored by 

12 electric utilities, automobile manufacturers, technology 

13 providers, car sharing companies or organizations, or 

14 other persons or entities. 

15 (d) USE OF FUNDS.—Pursuant to applications re16 ceived under subsection (c), the Secretary may make fi17 nancial assistance available to any applicant or joint spon18 sor of the application to be used for any of the following: 

19 (1) Assisting persons located in the regional de20 ployment area, including fleet owners, in the pur21 chase of new plug-in electric drive vehicles by offset22 ting in whole or in part the incremental cost of such 

23 vehicles above the cost of comparable conventionally 

24 fueled vehicles. 


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1 (2) Supporting the use of plug-in electric drive 

2 vehicles by funding projects for the deployment of 

3 any of the following: 

4 (A) Electrical charging infrastructure for 

5 plug-in electric drive vehicles, including battery 

6 exchange, fast charging infrastructure, and 

7 other services, in public or private locations, in8 cluding street parking, parking garages, park9 ing lots, homes, gas stations, and highway rest 

10 stops. 

11 (B) Smart Grid equipment and infrastruc12 ture, as described in title XIII of the Energy 

13 Independence and Security Act of 2007, to fa14 cilitate the charging and integration of plug-in 

15 electric drive vehicles. 

16 (3) Such other projects as the Secretary deter17 mines appropriate to support the large-scale deploy18 ment of plug-in electric drive vehicles in regional de19 ployment areas. 

20 (e) PROGRAM REQUIREMENTS.—The Secretary, in 

21 consultation with the Administrator and the Secretary of 

22 Transportation, shall determine design elements and re23 quirements of the program established pursuant to sub24 section (a), including— 


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1 (1) the type of financial mechanism with which 

2 to provide financial assistance; 

3 (2) criteria for evaluating applications sub4 mitted under subsection (c), including the antici5 pated ability to promote deployment and market 

6 penetration of vehicles that are less dependent on 

7 petroleum as a fuel source; and 

8 (3) reporting requirements for entities that re9 ceive financial assistance under this section, includ10 ing a comprehensive set of performance data charac11 terizing the results of the deployment program. 

12 (f) INFORMATION CLEARINGHOUSE.—The Secretary 

13 shall, as part of the program established pursuant to sub14 section (a), collect and make available to the public infor15 mation regarding the cost, performance, and other tech16 nical data regarding the deployment and integration of 

17 plug-in electric drive vehicles. 

18 (g) AUTHORIZATION.—There are authorized to be ap19 propriated to carry out this section such sums as may be 

20 necessary. 

21 SEC. 123. PLUG-IN ELECTRIC DRIVE VEHICLE MANUFAC22 TURING. 

23 (a) VEHICLE MANUFACTURING ASSISTANCE PRO24 GRAM.—The Secretary of Energy shall establish a pro25 gram to provide financial assistance to automobile manuVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00109 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 facturers to facilitate the manufacture of plug-in electric 

2 drive vehicles, as defined in section 131(a)(5) of the En3 ergy Independence and Security Act of 2007, that are de4 veloped and produced in the United States. 

5 (b) FINANCIAL ASSISTANCE.—The Secretary of En6 ergy may provide financial assistance to an automobile 

7 manufacturer under the program established pursuant to 

8 subsection (a) for— 

9 (1) the reconstruction or retooling of facilities 

10 for the manufacture of plug-in electric drive vehicles 

11 that are developed and produced in the United 

12 States; and 

13 (2) if appropriate, the purchase of vehicle bat14 teries to be used in the manufacture of vehicles 

15 manufactured pursuant to paragraph (1). 

16 (c) COORDINATION WITH REGIONAL DEPLOY17 MENT.—The Secretary may provide financial assistance 

18 under subsection (b) in conjunction with the award of fi19 nancial assistance under the large scale vehicle electrifica20 tion program established pursuant to section 122 of this 

21 Act. 

22 (d) PROGRAM REQUIREMENTS.—The Secretary shall 

23 determine design elements and requirements of the pro24 gram established pursuant to subsection (a), including— 


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1 (1) the type of financial mechanism with which 

2 to provide financial assistance; 

3 (2) criteria, in addition to the criteria described 

4 under subsection (e), for evaluating applications for 

5 financial assistance; and 

6 (3) reporting requirements for automobile man7 ufacturers that receive financial assistance under 

8 this section. 

9 (e) CRITERIA.—In selecting recipients of financial as10 sistance from among applicant automobile manufacturers, 

11 the Secretary shall give preference to proposals that— 

12 (1) are most likely to be successful; and 

13 (2) are located in local markets that have the 

14 greatest need for the facility. 

15 (f) REPORTS.—The Secretary shall annually submit 

16 to Congress a report on the program established pursuant 

17 to this section. 

18 (g) AUTHORIZATION OF APPROPRIATIONS.—There 

19 are authorized to be appropriated such sums as are nec20 essary to carry out this section. 

21 SEC. 124. INVESTMENT IN CLEAN VEHICLES. 

22 (a) DEFINITIONS.—In this section: 

23 (1) ADVANCED TECHNOLOGY VEHICLES AND

24 QUALIFYING COMPONENTS.—The terms ‘‘advanced 

25 technology vehicles’’ and ‘‘qualifying components’’ 


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1 shall have the definition of such terms in section 136 

2 of the Energy Independence and Security Act of 

3 2007, except that for purposes of this section, the 

4 average base year as described in such section 

5 136(a)(1)(C) shall be the following: 

6 (A) In each of the years 2012 through 

7 2016, model year 2009. 

8 (B) In 2017, the Administrator shall, not9 withstanding such section 136(a)(1)(C), deter10 mine an appropriate baseline based on techno11 logical and economic feasibility. 

12 (2) PLUG-IN ELECTRIC DRIVE VEHICLE.—The 

13 term ‘‘plug-in electric drive vehicle’’ shall have the 

14 definition of such term in section 131 of the Energy 

15 Independence and Security Act of 2007. 

16 (b) DISTRIBUTION OF ALLOWANCES.—The Adminis17 trator shall, in accordance with this section, distribute 

18 emission allowances allocated pursuant to section 782(i) 

19 of the Clean Air Act not later than September 30 of 2012 

20 and each calendar year thereafter through 2025. 

21 (c) PLUG-IN ELECTRIC DRIVE VEHICLE MANUFAC22 TURING AND DEPLOYMENT.— 

23 (1) IN GENERAL.—The Administrator shall, at 

24 the direction of the Secretary of Energy, provide 

25 emission allowances allocated pursuant to section 


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1 782(i) to applicants, joint sponsors and automobile 

2 manufacturers pursuant to sections 122 and 123 of 

3 this Act. 

4 (2) ANNUAL AMOUNT.—In each of the years 

5 2012 through 2017, one-quarter of the portion of 

6 the emission allowances allocated pursuant to section 

7 782(i) of the Clean Air Act shall be available to 

8 carry out paragraph (1) such that— 

9 (A) one-eighth of the portion shall be avail10 able to carry out section 122; and, 

11 (B) one-eighth of the portion shall be 

12 available to carry out section 123. 

13 (3) PREFERENCE.—In directing the provision 

14 of emission allowances under this subsection to carry 

15 out section 122, the Secretary shall give preference 

16 to applications under section 122(c) that are jointly 

17 sponsored by one or more automobile manufacturers. 

18 (4) MULTI-YEAR COMMITMENTS.—The Admin19 istrator shall commit to providing emission allow20 ances to an applicant, joint sponsor, or automobile 

21 manufacturer for up to five consecutive years if— 

22 (A) an application under section 122 or 

23 123 of this Act requests a multi-year commit24 ment; 


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1 (B) such application meets the criteria for 

2 support established by the Secretary of Energy 

3 under sections 122 or 123 of this Act; 

4 (C) the Administrator confirms to the Sec5 retary that emission allowances will be available 

6 for a multi-year commitment; 

7 (D) the Secretary of Energy determines 

8 that a multi-year commitment for such applica9 tion will advance the goals of section 122 or 

10 123; and 

11 (E) the Secretary of Energy directs the 

12 Administrator to make a multi-year commit13 ment. 

14 (5) INSUFFICIENT APPLICATIONS.—If, in any 

15 year, emission allowances available under paragraph 

16 (2) cannot be provided because of insufficient num17 bers of submitted applications that meet the criteria 

18 for support established by the Secretary of Energy 

19 under sections 122 or 123 of this Act, the remaining 

20 emission allowances shall be distributed according to 

21 subsection (d). 

22 (d) ADVANCED TECHNOLOGY VEHICLES.— 

23 (1) IN GENERAL.—The Administrator shall, at 

24 the direction of the Secretary of Energy, provide any 

25 emission allowances allocated pursuant to section 


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1 782(i) of the Clean Air Act that are not provided 

2 under subsection (c) to automobile manufacturers 

3 and component suppliers to pay not more than 30 

4 percent of the cost of— 

5 (A) reequipping, expanding, or establishing 

6 a manufacturing facility in the United States to 

7 produce— 

8 (i) qualifying advanced technology ve9 hicles; or 

10 (ii) qualifying components; and 

11 (B) engineering integration performed in 

12 the United States of qualifying vehicles and 

13 qualifying components. 

14 (2) PREFERENCE.—In directing the provision 

15 of emission allowances under this subsection during 

16 the years 2012 through 2017, the Secretary shall 

17 give preference to applications for projects that save 

18 the maximum number of gallons of fuel. 

19 SEC. 125. ADVANCED TECHNOLOGY VEHICLE MANUFAC20 TURING INCENTIVE LOANS. 

21 Section 136(d)(1) of the Energy Independence and 

22 Security Act of 2007 (42 U.S.C. 17013(d)(1)) is amended 

23 by striking ‘‘$25,000,000,000’’ and inserting 

24 ‘‘$50,000,000,000’’. 


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1 SEC. 126. AMENDMENT TO RENEWABLE FUELS STANDARD. 

2 (a) DEFINITION OF RENEWABLE BIOMASS.—Section 

3 211(o)(1)(I) of the Clean Air Act (42 U.S.C. 7545(o)) is 

4 amended to read as follows: 

5 ‘‘(I) RENEWABLE BIOMASS.—The term ‘re6 newable biomass’ means any of the following: 

7 ‘‘(i) Plant material, including waste 

8 material, harvested or collected from ac9 tively managed agricultural land that was 

10 in cultivation, cleared, or fallow and non11 forested on January 1, 2009. 

12 ‘‘(ii) Plant material, including waste 

13 material, harvested or collected from 

14 pastureland that was nonforested on Janu15 ary 1, 2009. 

16 ‘‘(iii) Nonhazardous vegetative matter 

17 derived from waste, including separated 

18 yard waste, landscape right-of-way trim19 mings, construction and demolition debris 

20 or food waste (but not recyclable waste 

21 paper, painted, treated or pressurized 

22 wood, or wood contaminated with plastic or 

23 metals). 

24 ‘‘(iv) Animal waste or animal byprod25 ucts, including products of animal waste 

26 digesters. 


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1 ‘‘(v) Algae. 

2 ‘‘(vi) Trees, brush, slash, residues, or 

3 any other vegetative matter removed from 

4 within 600 feet of any building, camp5 ground, or route designated for evacuation 

6 by a public official with responsibility for 

7 emergency preparedness, or from within 

8 300 feet of a paved road, electric trans9 mission line, utility tower, or water supply 

10 line. 

11 ‘‘(vii) Residues from or byproducts of 

12 milled logs. 

13 ‘‘(viii) Any of the following removed 

14 from forested land that is not Federal and 

15 is not high conservation priority land: 

16 ‘‘(I) Trees, brush, slash, residues, 

17 interplanted energy crops, or any 

18 other vegetative matter removed from 

19 an actively managed tree plantation 

20 established— 

21 ‘‘(aa) prior to January 1, 

22 2009; or 

23 ‘‘(bb) on land that, as of 

24 January 1, 2009, was cultivated 

25 or fallow and non-forested. 


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1 ‘‘(II) Trees, logging residue, 

2 thinnings, cull trees, pulpwood, and 

3 brush removed from naturally-regen4 erated forests or other non-plantation 

5 forests, including for the purposes of 

6 hazardous fuel reduction or preventa7 tive treatment for reducing or con8 taining insect or disease infestation. 

9 ‘‘(III) Logging residue, 

10 thinnings, cull trees, pulpwood, brush 

11 and species that are non-native and 

12 noxious, from stands that were plant13 ed and managed after January 1, 

14 2009, to restore or maintain native 

15 forest types. 

16 ‘‘(IV) Dead or severely damaged 

17 trees removed within 5 years of fire, 

18 blowdown, or other natural disaster, 

19 and badly infested trees. 

20 ‘‘(ix) Materials, pre-commercial 

21 thinnings, or removed invasive species from 

22 National Forest System land and public 

23 lands (as defined in section 103 of the 

24 Federal Land Policy and Management Act 

25 of 1976 (43 U.S.C. 1702)), including those 


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1 that are byproducts of preventive treat2 ments (such as trees, wood, brush, 

3 thinnings, chips, and slash), that are re4 moved as part of a federally recognized 

5 timber sale, or that are removed to reduce 

6 hazardous fuels, to reduce or contain dis7 ease or insect infestation, or to restore eco8 system health, and that are— 

9 ‘‘(I) not from components of the 

10 National Wilderness Preservation Sys11 tem, Wilderness Study Areas, Inven12 toried Roadless Areas, old growth or 

13 mature forest stands, components of 

14 the National Landscape Conservation 

15 System, National Monuments, Na16 tional Conservation Areas, Designated 

17 Primitive Areas, or Wild and Scenic 

18 Rivers corridors; 

19 ‘‘(II) harvested in environ20 mentally sustainable quantities, as de21 termined by the appropriate Federal 

22 land manager; and 

23 ‘‘(III) harvested in accordance 

24 with Federal and State law and appli25 cable land management plans.’’. 


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1 (b) DEFINITION OF HIGH CONSERVATION PRIORITY

2 LAND.—Section 211(o)(1) of the Clean Air Act (42 

3 U.S.C. 7545(o)) is amended by inserting the following at 

4 the end thereof: 

5 ‘‘(M) HIGH CONSERVATION PRIORITY

6 LAND.—The term ‘high conservation priority 

7 land’ means land that is not Federal land and 

8 is— 

9 ‘‘(i) globally or State ranked as criti10 cally imperiled or imperiled under a State 

11 Natural Heritage Program; or 

12 ‘‘(ii) old-growth or late-successional 

13 forest, as identified by the office of the 

14 State Forester or relevant State agency 

15 with regulatory jurisdiction over forestry 

16 activities.’’. 

17 SEC. 127. OPEN FUEL STANDARD. 

18 (a) FINDINGS.—The Congress finds that— 

19 (1) the status of oil as a strategic commodity, 

20 which derives from its domination of the transpor21 tation sector, presents a clear and present danger to 

22 the United States; 

23 (2) in a prior era, when salt was a strategic 

24 commodity, salt mines conferred national power and 

25 wars were fought over the control of such mines; 


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1 (3) technology, in the form of electricity and re2 frigeration, decisively ended salt’s monopoly of meat 

3 preservation and greatly reduced its strategic impor4 tance; 

5 (4) fuel competition and consumer choice would 

6 similarly serve to end oil’s monopoly in the transpor7 tation sector and strip oil of its strategic status; 

8 (5) the current closed fuel market has allowed 

9 a cartel of petroleum exporting countries to inflate 

10 fuel prices, effectively imposing a harmful tax on the 

11 economy of the United States; 

12 (6) much of the inflated petroleum revenues the 

13 oil cartel earns at the expense of the people of the 

14 United States are used for purposes antithetical to 

15 the interests of the United States and its allies; 

16 (7) alcohol fuels, including ethanol and meth17 anol, could potentially provide significant supplies of 

18 additional fuels that could be produced in the United 

19 States and in many other countries in the Western 

20 Hemisphere that are friendly to the United States; 

21 (8) alcohol fuels can only play a major role in 

22 securing the energy independence of the United 

23 States if a substantial portion of vehicles in the 

24 United States are capable of operating on such fuels; 


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1 (9) it is not in the best interest of United 

2 States consumers or the United States Government 

3 to be constrained to depend solely upon petroleum 

4 resources for vehicle fuels if alcohol fuels are poten5 tially available; 

6 (10) existing technology, in the form of flexible 

7 fuel vehicles, allows internal combustion engine cars 

8 and trucks to be produced at little or no additional 

9 cost, which are capable of operating on conventional 

10 gasoline, alcohol fuels, or any combination of such 

11 fuels, as availability or cost advantage dictates, pro12 viding a platform on which fuels can compete; 

13 (11) the necessary distribution system for such 

14 alcohol fuels will not be developed in the United 

15 States until a substantial fraction of the vehicles in 

16 the United States are capable of operating on such 

17 fuels; 

18 (12) the establishment of such a vehicle fleet 

19 and distribution system would provide a large mar20 ket that would mobilize private resources to substan21 tially advance the technology and expand the pro22 duction of alcohol fuels in the United States and 

23 abroad; 

24 (13) the United States has an urgent national 

25 security interest to develop alcohol fuels technology, 


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1 production, and distribution systems as rapidly as 

2 possible; 

3 (14) new cars sold in the United States that 

4 are equipped with an internal combustion engine 

5 should allow for fuel competition by being flexible 

6 fuel vehicles, and new diesel cars should be capable 

7 of operating on biodiesel; and 

8 (15) such an open fuel standard would help to 

9 protect the United States economy from high and 

10 volatile oil prices and from the threats caused by 

11 global instability, terrorism, and natural disaster. 

12 (b) OPEN FUEL STANDARD FOR TRANSPOR13 TATION.—(1) Chapter 329 of title 49, United States Code, 

14 is amended by adding at the end the following: 

15 ‘‘§ 32920. Open fuel standard for transportation 

16 ‘‘(a) DEFINITIONS.—In this section: 

17 ‘‘(1) E85.—The term ‘E85’ means a fuel mix18 ture containing 85 percent ethanol and 15 percent 

19 gasoline by volume. 

20 ‘‘(2) FLEXIBLE FUEL AUTOMOBILE.—The term 

21 ‘flexible fuel automobile’ means an automobile that 

22 has been warranted by its manufacturer to operate 

23 on gasoline, E85, and M85. 

24 ‘‘(3) FUEL CHOICE-ENABLING AUTOMOBILE.— 

25 The term ‘fuel choice-enabling automobile’ means— 


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1 ‘‘(A) a flexible fuel automobile; or 

2 ‘‘(B) an automobile that has been war3 ranted by its manufacturer to operate on bio4 diesel. 

5 ‘‘(4) LIGHT-DUTY AUTOMOBILE.—The term 

6 ‘light-duty automobile’ means— 

7 ‘‘(A) a passenger automobile; or 

8 ‘‘(B) a non-passenger automobile. 

9 ‘‘(5) LIGHT-DUTY AUTOMOBILE MANUFAC10 TURER’S ANNUAL COVERED INVENTORY.—The term 

11 ‘light-duty automobile manufacturer’s annual cov12 ered inventory’ means the number of light-duty 

13 automobiles powered by an internal combustion en14 gine that a manufacturer, during a given calendar 

15 year, manufactures in the United States or imports 

16 from outside of the United States for sale in the 

17 United States. 

18 ‘‘(6) M85.—The term ‘M85’ means a fuel mix19 ture containing 85 percent methanol and 15 percent 

20 gasoline by volume. 

21 ‘‘(b) OPEN FUEL STANDARD FOR TRANSPOR22 TATION.— 

23 ‘‘(1) IN GENERAL.—The Secretary may promul24 gate regulations to require each light-duty auto25 mobile manufacturer’s annual covered inventory to 


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1 be comprised of a minimum percentage of fuel-choice 

2 enabling automobiles, with sufficient lead time, if 

3 the Secretary, in coordination with the Secretary of 

4 Energy and the Administrator of the Environmental 

5 Protection Agency, determines such requirement is a 

6 cost-effective way to achieve the Nation’s energy 

7 independence and environmental objectives. The 

8 cost-effective determination shall consider the future 

9 availability of both alternative fuel supply and infra10 structure to deliver the alternative fuel to the fuel11 choice enabling vehicles. 

12 ‘‘(2) TEMPORARY EXEMPTION FROM REQUIRE13 MENTS.— 

14 ‘‘(A) APPLICATION.—A manufacturer may 

15 request an exemption from the requirement de16 scribed in paragraph (1) by submitting an ap17 plication to the Secretary, at such time, in such 

18 manner, and containing such information as the 

19 Secretary may require by regulation. Each such 

20 application shall specify the models, lines, and 

21 types of automobiles affected. 

22 ‘‘(B) EVALUATION.—After evaluating an 

23 application received from a manufacturer, the 

24 Secretary may at any time, under such terms 

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1 retary considers appropriate, temporarily ex2 empt, or renew the exemption of, a light-duty 

3 automobile from the requirement described in 

4 paragraph (1) if the Secretary determines that 

5 unavoidable events not under the control of the 

6 manufacturer prevent the manufacturer of such 

7 automobile from meeting its required produc8 tion volume of fuel choice-enabling automobiles, 

9 including— 

10 ‘‘(i) a disruption in the supply of any 

11 component required for compliance with 

12 the regulations; 

13 ‘‘(ii) a disruption in the use and in14 stallation by the manufacturer of such 

15 component; or 

16 ‘‘(iii) application to plug-in electric 

17 drive vehicles causing such vehicles to fail 

18 to meet State air quality requirements. 

19 ‘‘(C) CONSOLIDATION.—The Secretary 

20 may consolidate applications received from mul21 tiple manufacturers under subparagraph (A) if 

22 they are of a similar nature. 

23 ‘‘(D) CONDITIONS.—Any exemption grant24 ed under subparagraph (B) shall be conditioned 

25 upon the manufacturer’s commitment to recall 


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1 the exempted automobiles for installation of the 

2 omitted components within a reasonable time 

3 proposed by the manufacturer and approved by 

4 the Secretary after such components become 

5 available in sufficient quantities to satisfy both 

6 anticipated production and recall volume re7 quirements. 

8 ‘‘(E) NOTICE.—The Secretary shall pub9 lish in the Federal Register— 

10 ‘‘(i) notice of each application received 

11 from a manufacturer; 

12 ‘‘(ii) notice of each decision to grant 

13 or deny a temporary exemption; and 

14 ‘‘(iii) the reasons for granting or de15 nying such exemptions.’’. 

16 (2) The table of contents in chapter 329 of such title 

17 is amended adding at the end the following: 

‘‘32920. Open fuel standard for transportation.’’. 

18 SEC. 128. DIESEL EMISSIONS REDUCTION. 

19 Subtitle G of title VII of the Energy Policy Act of 

20 2005 (42 U.S.C. 16131 et seq.) is amended— 

21 (1) in the matter preceding clause (i) in section 

22 791(3)(B), by inserting ‘‘in any State’’ after ‘‘non23 profit organization or institution’’; 

24 (2) in section 791(9), by striking ‘‘The term 

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1 serting ‘‘The term ‘State’ includes the District of 

2 Columbia, American Samoa, Guam, the Common3 wealth of the Northern Mariana Islands, Puerto 

4 Rico, and the Virgin Islands.’’; and 

5 (3) in section 793(c)— 

6 (A) in paragraph (2)(A), by striking ‘‘51 

7 States’’ and inserting ‘‘56 States’’; 

8 (B) in paragraph (2)(A), by striking ‘‘1.96 

9 percent’’ and inserting ‘‘1.785 percent’’; 

10 (C) in paragraph (2)(B), by striking ‘‘51 

11 States’’ and inserting ‘‘56 States’’; and 

12 (D) in paragraph (2)(B), by amending 

13 clause (ii) to read as follows: 

14 ‘‘(ii) the amount of funds remaining 

15 after each State described in paragraph (1) 

16 receives the 1.785-percent allocation under 

17 this paragraph.’’. 

18 SEC. 129. LOAN GUARANTEES FOR PROJECTS TO CON19 STRUCT RENEWABLE FUEL PIPELINES. 

20 (a) DEFINITIONS.—Section 1701 of the Energy Pol21 icy Act of 2005 (42 U.S.C. 16511) is amended by adding 

22 at the end the following: 

23 ‘‘(6) RENEWABLE FUEL.—The term ‘renewable 

24 fuel’ has the meaning given the term in section 

25 211(o)(1) of the Clean Air Act (42 U.S.C. 


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1 7545(o)(1)), except that the term shall include all 

2 ethanol and biodiesel. 

3 ‘‘(7) RENEWABLE FUEL PIPELINE.—The term 

4 ‘renewable fuel pipeline’ means a common carrier 

5 pipeline for transporting renewable fuel.’’. 

6 (b) RENEWABLE FUEL PIPELINE ELIGIBILITY.— 

7 Section 1703(b) the Energy Policy Act of 2005 (42 U.S.C. 

8 16513) is amended by adding at the end the following: 

9 ‘‘(11) Renewable fuel pipelines.’’. 

10 Subtitle D—State Energy and Envi11 ronment Development Accounts 

12 SEC. 131. ESTABLISHMENT OF SEED ACCOUNTS. 

13 (a) DEFINITIONS.—In this section: 

14 (1) SEED ACCOUNT.—The term ‘‘SEED Ac15 count’’ means a State Energy and Environment De16 velopment Account established pursuant to this sec17 tion. 

18 (2) STATE ENERGY OFFICE.—The term ‘‘State 

19 Energy Office’’ means a State entity eligible for 

20 grants under part D of title III of the Energy Policy 

21 and Conservation Act (42 U.S.C. 6321 et seq.). 

22 (b) ESTABLISHMENT OF PROGRAM.—The Adminis23 trator shall establish a program under which a State, 

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1 ignated by the State, may operate a State Energy and En2 vironment Development Account. 

3 (c) PURPOSE.—The purpose of each SEED Account 

4 is to serve as a common State-level repository for man5 aging and accounting for emission allowances provided to 

6 States designated for renewable energy and energy effi7 ciency purposes. 

8 (d) REGULATIONS.—Not later than one year after the 

9 date of enactment of this Act, the Administrator shall pro10 mulgate regulations to carry out this section, including 

11 regulations— 

12 (1) to ensure that each State operates its 

13 SEED Account and any subaccounts thereof effi14 ciently and in accordance with this Act and applica15 ble State and Federal laws; 

16 (2) to prevent waste, fraud, and abuse; 

17 (3) to indicate the emission allowances that 

18 may be deposited in a State’s SEED Account pend19 ing distribution or use; 

20 (4) to indicate the programs and objectives au21 thorized by Federal law for which emission allow22 ances in a SEED Account may be distributed or 

23 used; 


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1 (5) to identify the forms of financial assistance 

2 and incentives that States may provide through dis3 tribution or use of SEED Accounts; and 

4 (6) to prescribe the form and content of reports 

5 that the States are required to submit under this 

6 section on the use of SEED Accounts. 

7 (e) OPERATION.— 

8 (1) DEPOSITS.— 

9 (A) IN GENERAL.—In the allowance track10 ing system established pursuant to section 

11 724(d) of the Clean Air Act, the Administrator 

12 shall establish a SEED Account for each State 

13 and place in it the allowances allocated pursu14 ant to section 782(g) of the Clean Air Act to 

15 be distributed to States pursuant to sections 

16 132 and 201 of this Act. 

17 (B) FINANCIAL ACCOUNT.—A State may 

18 create a financial account associated with its 

19 SEED Account to deposit, retain, and manage 

20 any proceeds of any sale of any allowance pro21 vided pursuant to this Act pending expenditure 

22 or disbursement of those proceeds for purposes 

23 permitted under this section. The funds in such 

24 an account shall not be commingled with other 

25 funds not derived from the sale of allowances 


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1 provided to the State; however, loans made by 

2 the State from such funds pursuant to para3 graph (2)(C)(i) may be repaid into such a fi4 nancial account, including any interest charged. 

5 (2) WITHDRAWALS.— 

6 (A) IN GENERAL.—All allowances distrib7 uted pursuant to sections 132 and 201, includ8 ing the proceeds of any sale of such allowances, 

9 shall support renewable energy and energy effi10 ciency programs authorized or approved by the 

11 Federal Government. 

12 (B) DEDICATED ALLOWANCES.—Allow13 ances distributed pursuant to sections 132 and 

14 201 that are required by law to be used for spe15 cific purposes for a specified period shall be 

16 used according to those requirements during 

17 that period. 

18 (C) UNDEDICATED ALLOWANCES.—To the 

19 extent that allowances distributed pursuant to 

20 sections 132 and 201 are not required by law 

21 to be used for specific purposes for a specified 

22 period as described in subparagraph (B), such 

23 allowances or the proceeds of their sale may be 

24 used for any of the following purposes: 


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1 (i) LOANS.—Loans of allowances, or 

2 the proceeds from the sale of allowances, 

3 may be provided, interest on commercial 

4 loans may be subsidized at an interest rate 

5 as low as zero, and other credit support 

6 may be provided to support programs au7 thorized to use SEED Account allowance 

8 value or any other renewable energy or en9 ergy efficiency purpose authorized or ap10 proved by the Federal Government. 

11 (ii) GRANTS.—Grants of allowances or 

12 the proceeds of their sale may be provided 

13 to support programs authorized to use 

14 SEED Account allowance value or any 

15 other renewable energy or energy efficiency 

16 purpose authorized or approved by the 

17 Federal Government. 

18 (iii) OTHER FORMS OF SUPPORT.—Al19 lowances or the proceeds of the sale of al20 lowances may be provided for other forms 

21 of support for programs authorized to use 

22 SEED Account allowance value or any 

23 other renewable energy or energy efficiency 

24 purpose authorized or approved by the 

25 Federal Government. 


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1 (iv) ADMINISTRATIVE COSTS.—Except 

2 to the extent provided in Federal law au3 thorizing or allocating allowances deposited 

4 in a SEED Account, not more than 5 per5 cent of the allowance value in a SEED Ac6 count in any year may be used to cover ad7 ministrative expenses of the SEED Ac8 count. 

9 (D) SUBACCOUNTS.—A State may request 

10 that the Administrator establish accounts for 

11 local governments that request such sub12 accounts to hold allowances distributed to local 

13 governments for renewable energy or energy ef14 ficiency programs authorized or approved by 

15 the Federal Government. 

16 (E) INTENDED USE PLANS.— 

17 (i) IN GENERAL.—After providing for 

18 public review and comment, each State ad19 ministering a SEED Account shall annu20 ally prepare a plan that identifies the in21 tended uses of the allowances or proceeds 

22 from the sale of allowances in its SEED 

23 Account. 

24 (ii) CONTENTS.—An intended use 

25 plan shall include— 


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1 (I) a list of the projects or pro2 grams for which withdrawals from the 

3 SEED Account are intended in the 

4 next fiscal year that begins after the 

5 date of the plan, including a descrip6 tion of each project; 

7 (II) the relationship of each of 

8 the projects or programs to an identi9 fied Federal purpose authorized by 

10 this Act, or any other Federal statute; 

11 (III) the expected terms of use of 

12 allowance value to provide assistance; 

13 (IV) the criteria and methods es14 tablished for the distribution of allow15 ances or allowance value; 

16 (V) a description of the equiva17 lent financial value and status of the 

18 SEED Account; and 

19 (VI) a statement of the mid-term 

20 and long-term goals of the State for 

21 use of its SEED Account. 

22 (3) ACCOUNTABILITY AND TRANSPARENCY.— 

23 (A) CONTROLS AND PROCEDURES.—Any 

24 State that has a SEED Account shall establish 

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1 ing procedures for the SEED Account sufficient 

2 to ensure proper accounting during appropriate 

3 accounting periods for distributions into the 

4 SEED Account, transfers from the SEED Ac5 count, and SEED Account balances, including 

6 any related financial accounts. Such controls 

7 and procedures shall conform to generally ac8 cepted government accounting principles. Any 

9 State that has a SEED Account shall retain 

10 records for a period of at least 5 years. 

11 (B) AUDITS.—Any State that has a SEED 

12 Account shall have an annual audit conducted 

13 of the SEED Account by an independent public 

14 accountant in accordance with generally accept15 ed auditing standards, and shall transmit the 

16 results of that audit to the Administrator. 

17 (C) STATE REPORT.—Each State admin18 istering a SEED Account shall make publicly 

19 available and submit to the Administrator a re20 port every 2 years on its activities related to its 

21 SEED Account. 

22 (D) PUBLIC INFORMATION.—Any— 

23 (i) controls and procedures established 

24 under subparagraph (A); and 


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1 (ii) information obtained through au2 dits conducted under subparagraph (B), 

3 except to the extent that it would be pro4 tected from disclosure, if it were informa5 tion held by the Federal Government, 

6 under section 552(b) of title 5, United 

7 States Code, 

8 shall be made publicly available. 

9 (E) OTHER PROTECTIONS.—The Adminis10 trator shall require such additional procedures 

11 and protections as are necessary to ensure that 

12 any State that has a SEED Account will oper13 ate the SEED Account in an accountable and 

14 transparent manner. 

15 (f) REQUIREMENTS FOR ELIGIBILITY.—A State’s eli16 gibility to receive allowances in its SEED Account shall 

17 depend on that State’s compliance with the requirements 

18 of this Act (and the amendments made by this Act). 

19 (g) AUTHORIZATION OF APPROPRIATIONS.—There 

20 are authorized to be appropriated to the Administrator 

21 such sums as may be necessary for SEED Account oper22 ations. 

23 SEC. 132. SUPPORT OF STATE RENEWABLE ENERGY AND 

24 ENERGY EFFICIENCY PROGRAMS. 

25 (a) DEFINITIONS.—For purposes of this section: 


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1 (1) ALLOWANCE.—The term ‘‘allowance’’ 

2 means an emission allowance established under sec3 tion 721 of the Clean Air Act (as added by section 

4 311 of this Act). 

5 (2) COST-EFFECTIVE.—The term ‘‘cost-effec6 tive’’, with respect to an energy efficiency program, 

7 means that the program meets the Total Resource 

8 Cost Test, which requires that the net present value 

9 of economic benefits over the life of the program or 

10 measure, including avoided supply and delivery costs 

11 and deferred or avoided investments, is greater than 

12 the net present value of the economic costs over the 

13 life of the program, including program costs and in14 cremental costs borne by the energy consumer. 

15 (3) RENEWABLE ENERGY RESOURCE.—The 

16 term ‘‘renewable energy resource’’ shall have the 

17 meaning given that term in section 610 of the Public 

18 Utility Regulatory Policies Act of 1978 (as added by 

19 section 101 of this Act). 

20 (4) VINTAGE YEAR.—The term ‘‘vintage year’’ 

21 shall the meaning given that term in section 700 of 

22 the Clean Air Act (as added by section 311 of this 

23 Act). 

24 (b) DISTRIBUTION AMONG STATES.—Not later than 

25 September 30 of each calendar year from 2011 through 


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1 2049, the Administrator shall, in accordance with this sec2 tion, distribute allowances allocated pursuant to section 

3 782(g)(1) of the Clean Air Act (as added by section 311 

4 of this Act) for the following vintage year. The Adminis5 trator shall distribute 0.5 percent of such allowances pur6 suant to section 133 of this Act. The Administrator shall 

7 distribute the remaining allowances to States for renew8 able energy and energy efficiency programs to be deposited 

9 in and administered through the State Energy and Envi10 ronment Development (SEED) Accounts established pur11 suant to section 131. The Administrator shall distribute 

12 allowances among the States under this section each year 

13 in accordance with the following formula: 

14 (1) One third of the allowances shall be divided 

15 equally among the States. 

16 (2) One third of the allowances shall be distrib17 uted ratably among the States based on the popu18 lation of each State, as contained in the most recent 

19 reliable census data available from the Bureau of the 

20 Census, Department of Commerce, for all States at 

21 the time the Administrator calculates the formula 

22 for distribution. 

23 (3) One third of the allowances for shall be dis24 tributed ratably among the States on the basis of 

25 the energy consumption of each State as contained 


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1 in the most recent State Energy Data Report avail2 able from the Energy Information Administration 

3 (or such alternative reliable source as the Adminis4 trator may designate). 

5 (c) USES.—The allowances distributed to each State 

6 pursuant to this section shall be used exclusively in accord7 ance with the following requirements: 

8 (1) Not less than 12.5 percent shall be distrib9 uted by the State to units of local government within 

10 such State to be used exclusively to support the en11 ergy efficiency and renewable energy purposes listed 

12 in paragraphs (2) and (3). 

13 (2) Not less than 20 percent shall be used ex14 clusively for the following energy efficiency purposes, 

15 provided that not less than 1 percent shall be used 

16 for the purpose described in subparagraph (D) and 

17 not less than 5 percent shall be used for the purpose 

18 described in subparagraph (E): 

19 (A) Implementation and enforcement of 

20 building codes adopted in compliance with sec21 tion 201. 

22 (B) Implementation of the energy efficient 

23 manufactured homes program established pur24 suant to section 203. 


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1 (C) Implementation of the building energy 

2 performance labeling program established pur3 suant to section 204. 

4 (D) Low-income community energy effi5 ciency programs that are consistent with the 

6 grant program established under section 264 of 

7 this Act. 

8 (E) Implementation of the Retrofit for En9 ergy and Environmental Performance (REEP) 

10 program established pursuant to section 202. 

11 (3) Not less than 20 percent shall be used ex12 clusively for capital grants, tax credits, production 

13 incentives, loans, loan guarantees, forgivable loans, 

14 and interest rate buy-downs for— 

15 (A) re-equipping, expanding, or estab16 lishing a manufacturing facility that receives 

17 certification from the Secretary of Energy pur18 suant to section 1302 of the American Recovery 

19 and Reinvestment Act of 2009 for the produc20 tion of— 

21 (i) property designed to be used to 

22 produce energy from renewable energy 

23 sources; and 

24 (ii) electricity storage systems; 


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1 (B) deployment of technologies to generate 

2 electricity from renewable energy sources; and 

3 (C) deployment of facilities or equipment, 

4 such as solar panels, to generate electricity or 

5 thermal energy from renewable energy re6 sources in and on buildings in an urban envi7 ronment. 

8 (4) The remaining 47.5 percent shall be used 

9 exclusively for any of the following purposes: 

10 (A) Energy efficiency purposes described 

11 in paragraph (2). 

12 (B) Renewable energy purposes described 

13 in paragraph (3)(B) and (C). 

14 (C) Cost-effective energy efficiency pro15 grams for end-use consumers of electricity, nat16 ural gas, home heating oil, or propane, includ17 ing, where appropriate, programs or mecha18 nisms administered by local governments and 

19 entities other than the State. 

20 (D) Enabling the development of a Smart 

21 Grid (as described in section 1301 of the En22 ergy Independence and Security Act of 2007 

23 (42 U.S.C. 17381)) for State, local government, 

24 and other public buildings and facilities, includ25 ing integration of renewable energy resources 


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1 and distributed generation, demand response, 

2 demand side management, and systems anal3 ysis. 

4 (E) Providing the non-Federal share of 

5 support for surface transportation capital 

6 projects under— 

7 (i) sections 5307, 5308, 5309, 5310, 

8 5311 and 5319 of title 49, United States 

9 Code; and 

10 (ii) sections 142, 146, and 149 of title 

11 23, United States Code, 

12 provided that not more than 10 percent of al13 lowances distributed to each State pursuant to 

14 this section shall be used for such purpose. 

15 (5) For any allowances used for the purpose de16 scribed in paragraph (4)(C), the State shall— 

17 (A) prioritize expansion of existing energy 

18 efficiency programs approved and overseen by 

19 the State or the appropriate State regulatory 

20 authority; and 

21 (B) demonstrate that such allowances have 

22 been used to supplement, and not to supplant, 

23 existing and otherwise available State, local, 

24 and ratepayer funding for such purpose. 


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1 (d) REPORTING.—Each State receiving allowances 

2 under this section shall include in its biennial reports re3 quired under section 131, in accordance with such require4 ments as the Administrator may prescribe 

5 (1) a list of entities receiving allowances or al6 lowance value under this section, including entities 

7 receiving such allowances or allowance value from 

8 units of local government pursuant to subsection 

9 (c)(1); 

10 (2) the amount and nature of allowances or al11 lowance value received by each such recipient; 

12 (3) the specific purposes for which such allow13 ances or allowance value was conveyed to each such 

14 recipient; 

15 (4) documentation of the amount of energy sav16 ings, emission reductions, renewable energy deploy17 ment, and new or retooled manufacturing capacity 

18 resulting from the use of such allowances or allow19 ance value; and 

20 (5) for any energy efficiency program supported 

21 under subsection (c)(4)(C)— 

22 (A) an assessment demonstrating the cost23 effectiveness of such program; and 


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1 (B) a demonstration that the requirements 

2 set forth in subsection (c)(5) have been satis3 fied. 

4 (e) ENFORCEMENT.—If the Administrator deter5 mines that a State is not in compliance with this section, 

6 the Administrator may withhold up to twice the number 

7 of allowances that the State failed to use in accordance 

8 with the requirements of this section, that such State 

9 would otherwise be eligible to receive under this section 

10 in later years. Allowances withheld pursuant to this sub11 section shall be distributed among the remaining States 

12 in accordance with the requirements of subsection (b). 

13 SEC. 133. SUPPORT OF INDIAN RENEWABLE ENERGY AND 

14 ENERGY EFFICIENCY PROGRAMS. 

15 (a) DEFINITIONS.—For purposes of this section: 

16 (1) ALLOWANCE; COST-EFFECTIVE; RENEW17 ABLE ENERGY RESOURCE.—The terms ‘‘allowance’’, 

18 ‘‘cost-effective’’, and ‘‘renewable energy resource’’ 

19 have the meaning given those terms in section 132 

20 of this Act. 

21 (2) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 

22 has the meaning given the term in section 4 of the 

23 Indian Self-Determination and Education Assistance 

24 Act (25. U.S.C. 450b). 


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1 (3) SECRETARY.—The term ‘‘Secretary’’ means 

2 the Secretary of Energy. 

3 (b) ESTABLISHMENT.—Not later than 18 months 

4 after the date of enactment of this Act, the Secretary 

5 shall, in consultation with the Administrator and the Sec6 retary of the Interior, promulgate regulations establishing 

7 a program to distribute allowances to Indian tribes on a 

8 competitive basis for the following purposes: 

9 (1) ENERGY EFFICIENCY.—Cost-effective en10 ergy efficiency programs for end-use consumers of 

11 electricity, natural gas, home heating oil, or propane. 

12 (2) RENEWABLE ENERGY.—Deployment of 

13 technologies to generate electricity from renewable 

14 energy resources. 

15 (c) REQUIREMENTS.—The regulations promulgated 

16 pursuant to subsection (b) shall prescribe design elements 

17 and requirements of the program established under this 

18 section, including— 

19 (1) objective criteria for evaluating proposals 

20 submitted by Indian tribes, and for selecting projects 

21 and programs to receive support, under this section; 

22 (2) reporting requirements for Indian tribes 

23 that receive allowances under this section; and 

24 (3) other appropriate elements and require25 ments. 


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1 (d) DISTRIBUTION.—The Administrator shall, at the 

2 direction of the Secretary, distribute to Indian tribes al3 lowances that are set aside, pursuant to section 132, for 

4 use under this section. 

5 Subtitle E—Smart Grid 

6 Advancement 

7 SEC. 141. DEFINITIONS. 

8 For purposes of this subtitle: 

9 (1) The term ‘‘applicable baseline’’ means the 

10 average of the highest three annual peak demands a 

11 load-serving entity has experienced during the 5 

12 years immediately prior to the date of enactment of 

13 this Act. 

14 (2) The term ‘‘Commission’’ means Federal En15 ergy Regulatory Commission. 

16 (3) The term ‘‘load-serving entity’’ means an 

17 entity that provides electricity directly to retail con18 sumers with the responsibility to assure power qual19 ity and reliability, including such entities that are 

20 investor-owned, publicly owned, owned by rural elec21 tric cooperatives, or other entities. 

22 (4) The term ‘‘peak demand’’ means the high23 est point of electricity demand, net of any distrib24 uted electricity generation or storage from sources 

25 on the load-serving entity’s customers’ premises, 


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1 during any hour on the system of a load serving en2 tity during a calendar year, expressed in Megawatts 

3 (MW), or more than one such high point as a func4 tion of seasonal demand changes. 

5 (5) The term ‘‘peak demand reduction’’ means 

6 the reduction in annual peak demand as compared 

7 to a previous baseline year or period, expressed in 

8 Megawatts (MW), whether accomplished by— 

9 (A) diminishing the end-use requirements 

10 for electricity; 

11 (B) use of locally stored energy or gen12 erated electricity to meet those requirements 

13 from distributed resources on the load-serving 

14 entity’s customers’ premises and without use of 

15 high-voltage transmission; or 

16 (C) energy savings from efficient operation 

17 of the distribution grid resulting from the use 

18 of a Smart Grid. 

19 (6) The term ‘‘peak demand reduction plan’’ 

20 means a plan developed by or for a load-serving enti21 ty that it will implement to meet its peak demand 

22 reduction goals. 

23 (7) The term ‘‘peak period’’ means the time pe24 riod on the system of a load-serving entity relative 

25 to peak demand that may warrant special measures 


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1 or electricity resources to maintain system reliability 

2 while meeting peak demand. 

3 (8) The term ‘‘Secretary’’ means the Secretary 

4 of Energy. 

5 (9) The term ‘‘Smart Grid’’ has the meaning 

6 provided by section 1301 of the Energy Independ7 ence and Security Act of 2007 (15 U.S.C. 17381). 

8 SEC. 142. ASSESSMENT OF SMART GRID COST EFFECTIVE9 NESS IN PRODUCTS. 

10 (a) ASSESSMENT.—Within one year after the date of 

11 enactment of this Act, the Secretary and the Adminis12 trator shall each assess the potential for cost-effective in13 tegration of Smart Grid technologies and capabilities in 

14 all products that are reviewed by the Department of En15 ergy and the Environmental Protection Agency, respec16 tively, for potential designation as Energy Star products. 

17 (b) ANALYSIS.—(1) Within 2 years after the date of 

18 enactment of this Act, the Secretary and the Adminis19 trator shall each prepare an analysis of the potential en20 ergy savings, greenhouse gas emission reductions, and 

21 electricity cost savings that could accrue for each of the 

22 products identified by the assessment in subsection (a) in 

23 the following optimal circumstances: 


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1 (A) The products possessed Smart Grid capa2 bility and interoperability that is tested and proven 

3 reliable. 

4 (B) The products were utilized in an electricity 

5 utility service area which had Smart Grid capability 

6 and offered customers rate or program incentives to 

7 use the products. 

8 (C) The utility’s rates reflected national average 

9 costs, including average peak and valley seasonal 

10 and daily electricity costs. 

11 (D) Consumers using such products took full 

12 advantage of such capability. 

13 (E) The utility avoided incremental investments 

14 and rate increases related to such savings. 

15 (2) The analysis under paragraph (1) shall be consid16 ered the ‘‘best case’’ Smart Grid analysis. On the basis 

17 of such an analysis for each product, the Secretary and 

18 the Administrator shall determine whether the installation 

19 of Smart Grid capability for such a product would be cost 

20 effective. For purposes of this paragraph, the term ‘‘cost 

21 effective’’ means that the cumulative savings from using 

22 the product under the best case Smart Grid circumstances 

23 for a period of one-half of the product’s expected useful 

24 life will be greater than the incremental cost of the Smart 

25 Grid features included in the product. 


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1 (3) To the extent that including Smart Grid capa2 bility in any products analyzed under paragraph (2) is 

3 found to be cost effective in the best case, the Secretary 

4 and the Administrator shall, not later than 3 years after 

5 the date of enactment of this Act take each of the fol6 lowing actions: 

7 (A) Inform the manufacturer of such product of 

8 such finding of cost effectiveness. 

9 (B) Assess the potential contributions the devel10 opment and use of products with Smart Grid tech11 nologies bring to reducing peak demand and pro12 moting grid stability. 

13 (C) Assess the potential national energy savings 

14 and electricity cost savings that could be realized if 

15 Smart Grid potential were installed in the relevant 

16 products reviewed by the Energy Star program. 

17 (D) Assess and identify options for providing 

18 consumers information on products with Smart Grid 

19 capabilities, including the necessary conditions for 

20 cost-effective savings. 

21 (E) Submit a report to Congress summarizing 

22 the results of the assessment for each class of prod23 ucts, and presenting the potential energy and green24 house gas savings that could result if Smart Grid 


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1 capability were installed and utilized on such prod2 ucts. 

3 SEC. 143. INCLUSIONS OF SMART GRID CAPABILITY ON AP4 PLIANCE ENERGY GUIDE LABELS. 

5 Section 324(a)(2) of the Energy Policy and Conserva6 tion Act (42 U.S.C. 6294(a)(2)) is amended by adding the 

7 following at the end: 

8 ‘‘(J)(i) Not later than 1 year after the date 

9 of enactment of this subparagraph, the Federal 

10 Trade Commission shall initiate a rulemaking 

11 to consider making a special note in a promi12 nent manner on any ENERGY GUIDE label 

13 for any product actually including Smart Grid 

14 capability that— 

15 ‘‘(I) Smart Grid capability is a fea16 ture of that product; 

17 ‘‘(II) the use and value of that feature 

18 depended on the Smart Grid capability of 

19 the utility system in which the product was 

20 installed and the active utilization of that 

21 feature by the customer; and 

22 ‘‘(III) on a utility system with Smart 

23 Grid capability, the use of the product’s 

24 Smart Grid capability could reduce the 

25 customer’s cost of the product’s annual opVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00152 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 eration by an estimated dollar amount 

2 range representing the result of incre3 mental energy and electricity cost savings 

4 that would result from the customer taking 

5 full advantage of such Smart Grid capa6 bility. 

7 ‘‘(ii) Not later than 3 years after the date 

8 of enactment of this subparagraph, the Com9 mission shall complete the rulemaking initiated 

10 under clause (i).’’. 

11 SEC. 144. SMART GRID PEAK DEMAND REDUCTION GOALS. 

12 (a) GOALS.—Not later than one year after the date 

13 of enactment of this section, each load-serving entity, or, 

14 at the option of the State, each State with respect to load15 serving entities that the State regulates, shall determine 

16 and publish peak demand reduction goals for any load17 serving entities that have an applicable baseline in excess 

18 of 250 megawatts. 

19 (b) BASELINES.—(1) The Commission, in consulta20 tion with the Secretary and the Administrator, shall de21 velop and publish, after an opportunity for public com22 ment, but not later than 180 days after enactment of this 

23 section, a methodology to provide for adjustments or nor24 malization to a load-serving entity’s applicable baseline 

25 over time to reflect changes in the number of customers 


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1 served, weather conditions, general economic conditions, 

2 and any other appropriate factors external to peak de3 mand management, as determined by the Commission. 

4 (2) The Commission shall support load-serving enti5 ties (including any load-serving entities with an applicable 

6 baseline of less than 250 megawatts that volunteer to par7 ticipate in achieving the purposes of this section) in deter8 mining their applicable baselines, and in developing their 

9 peak demand reduction goals. 

10 (3) The Secretary, in consultation with the Commis11 sion, the Administrator, and the North American Electric 

12 Reliability Corporation, shall develop a system and rules 

13 for measurement and verification of demand reductions. 

14 (c) PEAK DEMAND REDUCTION GOALS.—(1) Peak 

15 demand reduction goals may be established for an indi16 vidual load-serving entity, or, at the determination of a 

17 State, tribal, or regional entity, by that State, tribal, or 

18 regional entity for a larger region that shares a common 

19 system peak demand and for which peak demand reduc20 tion measures would offer regional benefit. 

21 (2) A State or regional entity establishing peak de22 mand reduction goals shall cooperate, as necessary and 

23 appropriate, with the Commission, the Secretary, State 

24 regulatory commissions, State energy offices, the North 


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1 American Electric Reliability Corporation, and other rel2 evant authorities. 

3 (3) In determining the applicable peak demand reduc4 tion goals— 

5 (A) States and other jurisdictional entities may 

6 utilize the results of the 2009 National Demand Re7 sponse Potential Assessment, as authorized by sec8 tion 571 of the National Energy Conservation Policy 

9 Act (42 U.S.C. 8279); and 

10 (B) the relative economics of peak demand re11 duction and generation required to meet peak de12 mand shall be evaluated in a neutral and objective 

13 manner. 

14 (4) The applicable peak demand reduction goals shall 

15 provide that— 

16 (A) load-serving entities will reduce or mitigate 

17 peak demand by a minimum percentage amount 

18 from the applicable baseline to a lower peak demand 

19 during calendar year 2012; 

20 (B) load-serving entities will reduce or mitigate 

21 peak demand by a minimum percentage greater 

22 amount from the applicable baseline to a lower peak 

23 demand during calendar year 2015; and 

24 (C) the minimum percentage reductions estab25 lished as peak demand reduction goals shall be the 


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1 maximum reductions that are realistically achievable 

2 with an aggressive effort to deploy Smart Grid and 

3 peak demand reduction technologies and methods, 

4 including but not limited to those listed in sub5 section (d). 

6 (d) PLAN.—Each load-serving entity shall prepare a 

7 peak demand reduction plan that demonstrates its ability 

8 to meet each applicable goal by any or a combination of 

9 the following options: 

10 (1) Direct reduction in megawatts of peak de11 mand through— 

12 (A) energy efficiency measures (including 

13 efficient transmission wire technologies which 

14 significantly reduce line loss compared to tradi15 tional wire technology) with reliable and contin16 ued application during peak demand periods; or 

17 (B) use of a Smart Grid. 

18 (2) Demonstration that an amount of 

19 megawatts equal to a stated portion of the applicable 

20 goal is contractually committed to be available for 

21 peak reduction through one or more of the following: 

22 (A) Megawatts enrolled in demand re23 sponse programs. 

24 (B) Megawatts subject to the ability of a 

25 load-serving entity to call on demand response 


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1 programs, smart appliances, smart electricity or 

2 energy storage devices, distributed generation 

3 resources on the entity’s customers’ premises, 

4 or other measures directly capable of actively, 

5 controllably, reliably, and dynamically reducing 

6 peak demand (‘‘dynamic peak management con7 trol’’). 

8 (C) Megawatts available from distributed 

9 dynamic electricity or energy storage under 

10 agreement with the owner of that storage. 

11 (D) Megawatts committed from 

12 dispatchable distributed generation dem13 onstrated to be reliable under peak period con14 ditions and in compliance with air quality regu15 lations. 

16 (E) Megawatts available from smart appli17 ances and equipment with Smart Grid capa18 bility available for direct control by the utility 

19 through agreement with the customer owning 

20 the appliances or equipment or with a third 

21 party pursuant to such agreements. 

22 (F) Megawatts from a demonstrated and 

23 assured minimum of distributed solar electric 

24 generation capacity in instances where peak pe25 riod and peak demand conditions are directly 


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1 related to solar radiation and accompanying 

2 heat. 

3 (3) If any of the methods listed in subpara4 graph (C), (D), or (E) of paragraph (2) are relied 

5 upon to meet its peak demand reduction goals, the 

6 load-serving entity must demonstrate this capability 

7 by operating a test during the applicable calendar 

8 year. 

9 (4) Nothing in this section shall require the 

10 publication in peak demand reduction goals or in 

11 any peak demand reduction plan of any information 

12 that is confidential for competitive or other reasons 

13 or that identifies individual customers. 

14 (e) EXISTING AUTHORITY AND REQUIREMENTS.— 

15 Nothing in this section diminishes or supersedes any au16 thority of a State or political subdivision of a State to 

17 adopt or enforce any law or regulation respecting peak de18 mand management, demand response, distributed energy 

19 storage, use of distributed generation, or the regulation 

20 of load-serving entities. The Commission, in consultation 

21 with States and Indian tribes having such peak manage22 ment, demand response and distributed energy storage 

23 programs, shall to the maximum extent practicable, facili24 tate coordination between the Federal program and such 

25 State and tribal programs. 


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1 (f) RELIEF.—The Commission may, for good cause, 

2 grant relief to load-serving entities from the requirements 

3 of this section. 

4 (g) OTHER LAWS.—Except as provided in sub5 sections (e) and (f), no law or regulation shall relieve any 

6 person of any requirement otherwise applicable under this 

7 section. 

8 (h) COMPLIANCE.—(1) The Commission shall within 

9 one year after the date of enactment of this Act establish 

10 a public website where the Commission will provide infor11 mation and data demonstrating compliance by States, In12 dian tribes regional entities, and load-serving entities with 

13 this section, including the success of load-serving entities 

14 in meeting applicable peak demand reduction goals. 

15 (2) The Commission shall, by April 1 of each year 

16 beginning in 2012, provide a report to Congress on com17 pliance with this section and success in meeting applicable 

18 peak demand reduction goals and, as appropriate, shall 

19 make recommendations as to how to increase peak de20 mand reduction efforts. 

21 (3) The Commission shall note in each such report 

22 any State, political subdivision of a State, or load-serving 

23 entity that has failed to comply with this section, or is 

24 not a part of any region or group of load-serving entities 

25 serving a region that has complied with this section. 


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1 (4) The Commission shall have and exercise the au2 thority to take reasonable steps to modify the process of 

3 establishing peak demand reduction goals and to accept 

4 adjustments to them as appropriate when sought by load5 serving entities. 

6 (i) ASSISTANCE AND FUNDING.— 

7 (1) ASSISTANCE TO STATES AND TRIBES.—Any 

8 costs incurred by States for activities undertaken 

9 pursuant to this section shall be supported by the 

10 use of emission allowances allocated to the States’ 

11 SEED Accounts or to the tribes pursuant to section 

12 132 of this Act. To the extent that a State provides 

13 allowances to local governments within the State to 

14 implement this program, that shall be deemed a dis15 tribution of such allowances to units of local govern16 ment pursuant to subsection (c)(1) of that section. 

17 (2) FUNDING.—There are authorized to be ap18 propriated such sums as may be necessary to the 

19 Commission, the Secretary, and the Administrator to 

20 carry out the provisions of this section. 

21 SEC. 145. REAUTHORIZATION OF ENERGY EFFICIENCY PUB22 LIC INFORMATION PROGRAM TO INCLUDE 

23 SMART GRID INFORMATION. 

24 (a) IN GENERAL.—Section 134 of the Energy Policy 

25 Act of 2005 (42 U.S.C. 15832) is amended as follows: 


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1 (1) By amending the section heading to read as 

2 follows: ‘‘ENERGY EFFICIENCY AND SMART GRID

3 PUBLIC INFORMATION INITIATIVE’’. 

4 (2) In paragraph (1) of subsection (a) by strik5 ing ‘‘reduce energy consumption during the 4-year 

6 period beginning on the date of enactment of this 

7 Act’’ and inserting ‘‘increase energy efficiency and 

8 to adopt Smart Grid technology and practices’’. 

9 (3) In paragraph (2) of subsection (a) by strik10 ing ‘‘benefits to consumers of reducing’’ and insert11 ing ‘‘economic and environmental benefits to con12 sumers and the United States of optimizing’’. 

13 (4) In subsection (a) by inserting at the begin14 ning of paragraph (3) ‘‘the effect of energy effi15 ciency and Smart Grid capability in reducing energy 

16 and electricity prices throughout the economy, to17 gether with’’. 

18 (5) In subsection (a)(4) by redesignating sub19 paragraph (D) as (E), by striking ‘‘and’’ at the end 

20 of subparagraph (C), and by inserting after subpara21 graph (C) the following: 

22 ‘‘(D) purchasing and utilizing equipment 

23 that includes Smart Grid features and capa24 bility; and’’. 


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1 (6) In subsection (c), by striking ‘‘Not later 

2 than July 1, 2009,’’ and inserting, ‘‘For each year 

3 when appropriations pursuant to the authorization 

4 in this section exceed $10,000,000,’’. 

5 (7) In subsection (d) by striking ‘‘2010’’ and 

6 inserting ‘‘2020’’. 

7 (8) In subsection (e) by striking ‘‘2010’’ and in8 serting ‘‘2020’’. 

9 (b) TABLE OF CONTENTS.—The item relating to sec10 tion 134 in the table of contents for the Energy Policy 

11 Act of 2005 (42 U.S.C. 15801 and following) is amended 

12 to read as follows: 

‘‘Sec. 134. Energy efficiency and Smart Grid public information initiative.’’. 

13 SEC. 146. INCLUSION OF SMART GRID FEATURES IN APPLI14 ANCE REBATE PROGRAM. 

15 (a) AMENDMENTS.—Section 124 of the Energy Pol16 icy Act of 2005 (42 U.S.C. 15821) is amended as follows: 

17 (1) By amending the section heading to read as 

18 follows: ‘‘ENERGY EFFICIENT AND SMART AP19 PLIANCE REBATE PROGRAM.’’. 

20 (2) By redesignating paragraphs (4) and (5) of 

21 subsection (a) as paragraphs (5) and (6), respec22 tively, and inserting after paragraph (3) the fol23 lowing: 

24 ‘‘(4) SMART APPLIANCE.—The term ‘smart ap25 pliance’ means a product that the Administrator of 


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1 the Environmental Protection Agency or the Sec2 retary of Energy has determined qualifies for such 

3 a designation in the Energy Star program pursuant 

4 to section 142 of the American Clean Energy and 

5 Security Act of 2009, or that the Secretary or the 

6 Administrator has separately determined includes 

7 the relevant Smart Grid capabilities listed in section 

8 1301 of the Energy Independence and Security Act 

9 of 2007 (15 U.S.C. 17381).’’. 

10 (3) In subsection (b)(1) by inserting ‘‘and 

11 smart’’ after ‘‘efficient’’ and by inserting after 

12 ‘‘products’’ the first place it appears ‘‘, including 

13 products designated as being smart appliances’’. 

14 (4) In subsection (b)(3), by inserting ‘‘the ad15 ministration of’’ after ‘‘carry out’’. 

16 (5) In subsection (d), by inserting ‘‘the admin17 istration of’’ after ‘‘carrying out’’ and by inserting 

18 ‘‘, and up to 100 percent of the value of the rebates 

19 provided pursuant to this section’’ before the period 

20 at the end. 

21 (6) In subsection (e)(3), by inserting ‘‘, with 

22 separate consideration as applicable if the product is 

23 also a smart appliance,’’ after ‘‘Energy Star prod24 uct’’ the first place it appears and by inserting ‘‘or 

25 smart appliance’’ before the period at the end. 


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1 (7) In subsection (f), by striking 

2 ‘‘$50,000,000’’ through the period at the end and 

3 inserting ‘‘$100,000,000 for each fiscal year from 

4 2010 through 2015.’’. 

5 (b) TABLE OF CONTENTS.—The item relating to sec6 tion 124 in the table of contents for the Energy Policy 

7 Act of 2005 (42 U.S.C. 15801 and following) is amended 

8 to read as follows: 

‘‘Sec. 124. Energy efficient and smart appliance rebate program.’’. 

9 Subtitle F—Transmission Planning 

10 SEC. 151. TRANSMISSION PLANNING. 

11 Part II of the Federal Power Act (16 U.S.C. 824 et 

12 seq.) is amended by adding after section 216 the following 

13 new section: 

14 ‘‘SEC. 216A. TRANSMISSION PLANNING. 

15 ‘‘(a) FEDERAL POLICY.— 

16 ‘‘(1) OBJECTIVES.—It is the policy of the 

17 United States that regional electric grid planning 

18 should facilitate the deployment of renewable and 

19 other zero-carbon energy sources for generating elec20 tricity to reduce greenhouse gas emissions while en21 suring reliability, reducing congestion, ensuring 

22 cyber-security, and providing for cost-effective elec23 tricity services throughout the United States. 

24 ‘‘(2) OPTIONS.—In addition to the policy under 

25 paragraph (1), it is the policy of the United States 


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1 that regional electric grid planning to meet these ob2 jectives should take into account all significant de3 mand-side and supply-side options, including energy 

4 efficiency, distributed generation, renewable energy 

5 and zero-carbon electricity generation technologies, 

6 smart-grid technologies and practices, demand re7 sponse, electricity storage, voltage regulation tech8 nologies, high capacity conductors with at least 25 

9 percent greater efficiency than traditional ACSR 

10 (aluminum stranded conductors steel reinforced) 

11 conductors, superconductor technologies, under12 ground transmission technologies, and new conven13 tional electric transmission capacity and corridors. 

14 ‘‘(b) PLANNING.— 

15 ‘‘(1) PLANNING PRINCIPLES.—Not later than 1 

16 year after the date of enactment of this section, the 

17 Commission shall adopt, after notice and oppor18 tunity for comment, national electricity grid plan19 ning principles derived from the Federal policy es20 tablished under subsection (a) to be applied in ongo21 ing and future transmission planning that may im22 plicate interstate transmission of electricity. 

23 ‘‘(2) REGIONAL PLANNING ENTITIES.—Not 

24 later than 3 months after the date of adoption by 

25 the Commission of national electricity grid planning 


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1 principles pursuant to paragraph (1), entities that 

2 conduct or may conduct transmission planning pur3 suant to State, tribal, or Federal law or regulation, 

4 including States, Indian tribes, entities designated 

5 by States and Indian tribes, Federal Power Mar6 keting Administrations, public utility transmission 

7 providers, operators and owners, regional organiza8 tions, and electric utilities, and that are willing to 

9 incorporate the national electricity grid planning 

10 principles adopted by the Commission in their elec11 tric grid planning, shall identify themselves and the 

12 regions for which they propose to develop plans to 

13 the Commission. 

14 ‘‘(3) COORDINATION OF REGIONAL PLANNING

15 ENTITIES.—The Commission shall encourage re16 gional planning entities described under paragraph 

17 (2) to cooperate and coordinate across regions and 

18 to harmonize regional electric grid planning with 

19 planning in adjacent or overlapping jurisdictions to 

20 the maximum extent feasible. The Commission shall 

21 work with States, Indian tribes, Federal Power Mar22 keting Administrations, public utilities transmission 

23 providers, load-serving entities, transmission opera24 tors, Regional Transmission Organizations, Inde25 pendent System Operators, and other organizations 


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1 to resolve any conflict or competition among pro2 posed planning entities in order to build consensus 

3 and promote the Federal policy established under 

4 subsection (a). The Commission shall seek to ensure 

5 that planning that is consistent with the national 

6 electricity grid planning principles adopted pursuant 

7 to paragraph (1) is conducted in all regions of the 

8 United States and the territories. 

9 ‘‘(4) RELATION TO EXISTING PLANNING POL10 ICY.—In implementing the Federal policy established 

11 under subsection (a), the Commission shall— 

12 ‘‘(A) incorporate any ongoing planning ef13 forts undertaken pursuant to section 217; 

14 ‘‘(B) consult with and invite the participa15 tion of the Secretary of Energy in relationship 

16 to the Secretary’s duties pursuant to section 

17 216; and 

18 ‘‘(C) coordinate with the Secretaries of the 

19 Interior and Agriculture and with Indian tribes 

20 in carrying out the Secretaries’ or tribal govern21 ments’ existing responsibilities for the planning 

22 or siting of transmission facilities on Federal or 

23 tribal lands. 

24 ‘‘(5) ASSISTANCE.— 


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1 ‘‘(A) IN GENERAL.—The Commission shall 

2 provide support to and participate in the re3 gional grid planning processes conducted by re4 gional planning entities. The Commission may 

5 provide planning resources and assistance as re6 quired or as requested by regional planning en7 tities, including system data, cost information, 

8 system analysis, technical expertise, modeling 

9 support, dispute resolution services, and other 

10 assistance to regional planning entities, as ap11 propriate. 

12 ‘‘(B) AUTHORIZATION.—There are author13 ized to be appropriated such sums as may be 

14 necessary to carry out this paragraph. 

15 ‘‘(6) CONFLICT RESOLUTION.—In the event 

16 that regional grid plans conflict, the Commission 

17 shall assist the regional planning entities in resolving 

18 such conflicts in order to achieve the objectives of 

19 the Federal policy established under subsection (a). 

20 ‘‘(7) SUBMISSION OF PLANS.—The Commission 

21 shall require regional planning entities to submit ini22 tial regional electric grid plans to the Commission 

23 not later than 18 months after the date the Commis24 sion promulgates national electricity grid planning 

25 principles pursuant to paragraph (1) and to update 


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1 such plans not less than every 3 years thereafter. 

2 Regional electric grid plans should, in general, be 

3 developed from sub-regional requirements and plans, 

4 including planning input reflecting individual utility 

5 service areas. Regional plans may then in turn be 

6 combined into larger regional plans, up to inter7 connection-wide and national plans, as appropriate 

8 and necessary as determined by the Commission. 

9 The Commission shall review such plans for consist10 ency with the national grid planning principles and 

11 may return a plan to one or more planning entities 

12 for further consideration, along with the Commis13 sion’s own recommendations for resolution of any 

14 conflict or for improvement. To the extent prac15 ticable, all plans submitted to the Commission shall 

16 be public documents and available on the Commis17 sion’s website. 

18 ‘‘(8) MULTI-REGIONAL MEETINGS.—As regional 

19 grid plans are submitted to the Commission, the 

20 Commission may convene multi-regional meetings to 

21 discuss regional grid plan consistency and integra22 tion, including requirements for multi-regional 

23 projects, and to resolve any conflicts that emerge 

24 from such multi-regional projects. The Commission 


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1 shall provide its recommendations for eliminating 

2 any inter-regional conflicts. 

3 ‘‘(9) REPORT TO CONGRESS.—Not later than 3 

4 years after the date of enactment of this section, the 

5 Commission shall provide a report to Congress con6 taining the results of the initial regional grid plan7 ning process, including summaries of the adopted re8 gional plans. The Commission shall provide an elec9 tronic version of its report on its website with links 

10 to all regional and sub-regional plans taken into ac11 count. The Commission shall note and provide its 

12 recommended resolution for any conflicts not re13 solved during the planning process. The Commission 

14 shall make any recommendations to Congress on the 

15 appropriate Federal role or support required to ad16 dress the needs of the electric grid, including rec17 ommendations for addressing any needs that are be18 yond the reach of existing State, tribal, and Federal 

19 authority.’’. 

20 SEC. 152. NET METERING FOR FEDERAL AGENCIES. 

21 (a) STANDARD.—Subsection (b) of section 113 of the 

22 Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 

23 2623) is amended by adding the following new paragraph 

24 at the end thereof: 


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1 ‘‘(6) NET METERING FOR FEDERAL AGEN2 CIES.—Each electric utility shall offer to arrange 

3 (either directly or through a third party) to make 

4 interconnection and net metering available to Fed5 eral Government agencies, offices, or facilities in ac6 cordance with the requirements of section 115(j). 

7 The standard under this paragraph shall apply only 

8 to electric utilities that sold over 4,000,000 mega9 watt hours of electricity in the preceding year to the 

10 ultimate consumers thereof. In the case of a stand11 ard under this paragraph, a period of 1 year after 

12 the date of the enactment of this section shall be 

13 substituted for the 2-year period referred to in other 

14 provisions of this section.’’. 

15 (b) SPECIAL RULES.—Section 115 of the Public Util16 ity Regulatory Policies Act of 1978 (16 U.S.C. 2625) is 

17 amended by adding the following new subsection at the 

18 end thereof: 

19 ‘‘(j) NET METERING FOR FEDERAL AGENCIES.—(1) 

20 The standard under paragraph (6) of section 113(b) shall 

21 require that rates and charges and contract terms and 

22 conditions for the sale of electric energy to the Federal 

23 Government or agency shall be the same as the rates and 

24 charges and contract terms and conditions that would be 


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1 applicable if the agency did not own or operate a qualified 

2 generation unit and use a net metering system. 

3 ‘‘(2)(A) The standard under paragraph (6) of section 

4 113(b) shall require that each electric utility shall arrange 

5 to provide to the Government office or agency that quali6 fies for net metering an electrical energy meter capable 

7 of net metering and measuring, to the maximum extent 

8 practicable, the flow of electricity to or from the customer, 

9 using a single meter and single register, the cost of which 

10 shall be recovered from the customer. 

11 ‘‘(B) In a case in which it is not practicable to provide 

12 a meter under subparagraph (A), the utility (either di13 rectly or through a third party) shall, at the expense of 

14 the utility install 1 or more of those electric energy meters. 

15 ‘‘(3)(A) The standard under paragraph (6) of section 

16 113(b) shall require that each electric utility shall cal17 culate the electric energy consumption for the Government 

18 office or agency using a net metering system that meets 

19 the requirements of this subsection and paragraph (6) of 

20 section 113(b) and shall measure the net electricity pro21 duced or consumed during the billing period using the me22 tering installed in accordance with this paragraph. 

23 ‘‘(B) If the electricity supplied by the retail electric 

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1 ernment office or agency shall be billed for the net electric 

2 energy supplied by the retail electric supplier in accord3 ance with normal billing practices. 

4 ‘‘(C) If electric energy generated by the Government 

5 office or agency exceeds the electric energy supplied by 

6 the retail electric supplier during the billing period, the 

7 Government office or agency shall be billed for the appro8 priate customer charges for that billing period and cred9 ited for the excess electric energy generated during the 

10 billing period, with the credit appearing as a kilowatt-hour 

11 credit on the bill for the following billing period. 

12 ‘‘(D) Any kilowatt-hour credits provided to the Gov13 ernment office or agency as provided in this subsection 

14 shall be applied to the Government office or agency elec15 tric energy consumption on the following billing period bill 

16 (except for a billing period that ends in the next calendar 

17 year). At the beginning of each calendar year, any unused 

18 kilowatt-hour credits remaining from the preceding year 

19 will carry over to the new year. 

20 ‘‘(4) The standard under paragraph (6) of section 

21 113(b) shall require that each electric utility shall offer 

22 a meter and retail billing arrangement that has time-dif23 ferentiated rates. The kilowatt-hour credit shall be based 

24 on the ratio representing the difference in retail rates for 

25 each time-of-use rate, or the credits shall be reflected on 


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1 the bill of the Government office or agency as a monetary 

2 credit reflecting retail rates at the time of generation of 

3 the electric energy by the customer-generator. 

4 ‘‘(5) The standard under paragraph (6) of section 

5 113(b) shall require that the qualified generation unit, 

6 interconnection standards, and net metering system used 

7 by the Government office or agency shall meet all applica8 ble safety and performance and reliability standards estab9 lished by the National Electrical Code, the Institute of 

10 Electrical and Electronics Engineers, Underwriters Lab11 oratories, and the American National Standards Institute. 

12 ‘‘(6) The standard under paragraph (6) of section 

13 113(b) shall require that electric utilities shall not make 

14 additional charges, including standby charges, for equip15 ment or services for safety or performance that are in ad16 dition to those necessary to meet the other standards and 

17 requirements of this subsection and paragraph (6) of sec18 tion 113(b). 

19 ‘‘(7) For purposes of this subsection and paragraph 

20 (6) of section 113(b): 

21 ‘‘(A) The term ‘Government’ means any office, 

22 facility, or agency of the Federal Government. 

23 ‘‘(B) The term ‘customer-generator’ means the 

24 owner or operator of a electricity generation unit. 


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1 ‘‘(C) The term ‘electric generation unit’ means 

2 any renewable electric generation unit that is owned, 

3 operated, or sited on a Federal Government facility. 

4 ‘‘(D) The term ‘net metering’ means the proc5 ess of— 

6 ‘‘(i) measuring the difference between the 

7 electricity supplied to a customer-generator and 

8 the electricity generated by the customer-gener9 ator that is delivered to a utility at the same 

10 point of interconnection during an applicable 

11 billing period; and 

12 ‘‘(ii) providing an energy credit to the cus13 tomer-generator in the form of a kilowatt-hour 

14 credit for each kilowatt-hour of electricity pro15 duced by the customer-generator from an elec16 tric generation unit.’’. 

17 (c) SAVINGS PROVISION.—If this section or a portion 

18 of this section is determined to be invalid or unenforceable, 

19 that shall not affect the validity or enforceability of any 

20 other provision of this Act. 


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1 SEC. 153. SUPPORT FOR QUALIFIED ADVANCED ELECTRIC 

2 TRANSMISSION MANUFACTURING PLANTS, 

3 QUALIFIED HIGH EFFICIENCY TRANSMISSION 

4 PROPERTY, AND QUALIFIED ADVANCED 

5 ELECTRIC TRANSMISSION PROPERTY. 

6 (a) LOAN GUARANTEES PRIOR TO SEPTEMBER 30, 

7 2011.—Section 1705(a) of the Energy Policy Act of 2005 

8 (42 U.S.C. 16515(a)), as added by section 406 of the 

9 American Recovery and Reinvestment Act of 2009 (Public 

10 Law 109-58; 119 Stat. 594) is amended by adding the 

11 following new paragraph at the end thereof: 

12 ‘‘(5) The development, construction, acquisition, 

13 retrofitting, or engineering integration of a qualified 

14 advanced electric transmission manufacturing plant 

15 or the construction of a qualified high efficiency 

16 transmission property or a qualified advanced elec17 tric transmission property (whether by construction 

18 of new facilities or the modification of existing facili19 ties). For purposes of this paragraph: 

20 ‘‘(A) The term ‘qualified advanced electric 

21 transmission property’ means any high voltage 

22 electric transmission cable, related substation, 

23 converter station, or other integrated facility 

24 that— 

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1 vanced technology that has been deter2 mined by the Secretary of Energy as— 

3 ‘‘(I) reasonably likely to become 

4 commercially viable within 10 years 

5 after the date of enactment of this 

6 paragraph; 

7 ‘‘(II) capable of reliably transmit8 ting at least 5 gigawatts of high-volt9 age electric energy for distances 

10 greater than 300 miles with energy 

11 losses not exceeding 3 percent of the 

12 total power transported; and 

13 ‘‘(III) not creating an electro14 magnetic field; 

15 ‘‘(ii) has been determined by an ap16 propriate energy regulatory body, upon ap17 plication, to be in the public interest and 

18 thereby eligible for inclusion in regulated 

19 rates; and 

20 ‘‘(iii) can be located safely and eco21 nomically in a permanent underground 

22 right of way not to exceed 25 feet in width. 

23 The term ‘qualified advanced electric trans24 mission property’ shall not include any property 

25 placed in service after December 31, 2016. 


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1 ‘‘(B)(i) The term ‘qualified high efficiency 

2 transmission property’ means any high voltage 

3 overhead electric transmission line, related sub4 station, or other integrated facility that— 

5 ‘‘(I) utilizes advanced conductor core 

6 technology that— 

7 ‘‘(aa) has been determined by the 

8 Secretary of Energy as reasonably 

9 likely to become commercially viable 

10 within 10 years after the date of en11 actment of this paragraph; 

12 ‘‘(bb) is suitable for use on trans13 mission lines up to 765kV; and 

14 ‘‘(cc) exhibits power losses at 

15 least 30 percent lower than that of 

16 transmission lines using conventional 

17 ‘ACSR’ conductors; 

18 ‘‘(II) has been determined by an ap19 propriate energy regulatory body, upon ap20 plication, to be in the public interest and 

21 thereby eligible for inclusion in regulated 

22 rates; and 

23 ‘‘(III) can be located safely and eco24 nomically in a right of way not to exceed 


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1 that used by conventional ‘ACSR’ conduc2 tors; and 

3 ‘‘(ii) The term ‘qualified high efficiency 

4 transmission property’ shall not include any 

5 property placed in service after December 31, 

6 2016. 

7 ‘‘(C) The term ‘qualified advanced electric 

8 transmission manufacturing plant’ means any 

9 industrial facility located in the United States 

10 which can be equipped, re-equipped, expanded, 

11 or established to produce in whole or in part 

12 qualified advanced electric transmission prop13 erty.’’. 

14 (b) ADDITIONAL LOAN GUARANTEE AUTHORITY.— 

15 Section 1703 of the Energy Policy Act of 2005 (42 U.S.C. 

16 16513) is amended by adding the following new paragraph 

17 at the end of subsection (b): 

18 ‘‘(12) The development, construction, acquisi19 tion, retrofitting, or engineering integration of a 

20 qualified advanced electric transmission manufac21 turing plant or the construction of a qualified ad22 vanced electric transmission property (whether by 

23 construction of new facilities or the modification of 

24 existing facilities). For purposes of this paragraph, 

25 the terms ‘qualified advanced electric transmission 


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1 property’ and ‘qualified advanced electric trans2 mission manufacturing plant’ have the meanings 

3 provided by section 1705(a)(5).’’. 

4 (c) GRANTS.—The Secretary of Energy is authorized 

5 to provide grants for up to 50 percent of costs incurred 

6 in connection with the development, construction, acquisi7 tion of components for, or engineering of a qualified ad8 vanced electric transmission property defined in paragraph 

9 (5) of section 1705(a) of the Energy Policy Act of 2005 

10 (42 U.S.C. 16515(a)). Such grants may only be made to 

11 the first project which qualifies under that paragraph. 

12 There are authorized to be appropriated for purposes of 

13 this subsection not more than $100,000,000 for fiscal year 

14 2010. The United States shall take no equity or other 

15 ownership interest in the qualified advanced electric trans16 mission manufacturing plant or qualified advanced electric 

17 transmission property for which funding is provided under 

18 this subsection. 

19 Subtitle G—Technical Corrections 

20 to Energy Laws 

21 SEC. 161. TECHNICAL CORRECTIONS TO ENERGY INDE22 PENDENCE AND SECURITY ACT OF 2007. 

23 (a) TITLE III—ENERGY SAVINGS THROUGH IM24 PROVED STANDARDS FOR APPLIANCE AND LIGHTING.— 

25 (1) Section 325(u) of the Energy Policy and Conservation 


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1 Act (42 U.S.C. 6295(u)) (as amended by section 301(c) 

2 of the Energy Independence and Security Act of 2007 

3 (121 Stat. 1550)) is amended— 

4 (A) by redesignating paragraph (7) as 

5 paragraph (4); and 

6 (B) in paragraph (4) (as so redesignated), 

7 by striking ‘‘supplies is’’ and inserting ‘‘supply 

8 is’’. 

9 (2) Section 302 of the Energy Independence and Se10 curity Act of 2007 (121 Stat. 1551)) is amended— 

11 (A) in subsection (a), by striking ‘‘end of the 

12 paragraph’’ and inserting ‘‘end of subparagraph 

13 (A)’’; and 

14 (B) in subsection (b), by striking ‘‘6313(a)’’ 

15 and inserting ‘‘6314(a)’’. 

16 (3) Section 343(a)(1) of the Energy Policy and Con17 servation Act (42 U.S.C. 6313(a)(1)) (as amended by sec18 tion 302(b) of the Energy Independence and Security Act 

19 of 2007 (121 Stat. 1551)) is amended— 

20 (A) by striking ‘‘TEST PROCEDURES’’ and all 

21 that follows through ‘‘At least once’’ and inserting 

22 ‘‘TEST PROCEDURES.—At least once’’; and 

23 (B) by redesignating clauses (i) and (ii) as sub24 paragraphs (A) and (B), respectively (and by moving 


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1 the margins of such subparagraphs 2 ems to the 

2 left). 

3 (4) Section 342(a)(6) of the Energy Policy and Con4 servation Act (42 U.S.C. 6313(a)(6)) (as amended by sec5 tion 305(b)(2) of the Energy Independence and Security 

6 Act of 2007 (121 Stat. 1554)) is amended— 

7 (A) in subparagraph (B)— 

8 (i) by striking ‘‘If the Secretary’’ and in9 serting the following: 

10 ‘‘(i) IN GENERAL.—If the Secretary’’; 

11 (ii) by striking ‘‘clause (ii)(II)’’ and insert12 ing ‘‘subparagraph (A)(ii)(II)’’; 

13 (iii) by striking ‘‘clause (i)’’ and inserting 

14 ‘‘subparagraph (A)(i)’’; and 

15 (iv) by adding at the end the following: 

16 ‘‘(ii) FACTORS.—In determining 

17 whether a standard is economically justi18 fied for the purposes of subparagraph 

19 (A)(ii)(II), the Secretary shall, after receiv20 ing views and comments furnished with re21 spect to the proposed standard, determine 

22 whether the benefits of the standard ex23 ceed the burden of the proposed standard 

24 by, to the maximum extent practicable, 

25 considering— 


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1 ‘‘(I) the economic impact of the 

2 standard on the manufacturers and 

3 on the consumers of the products sub4 ject to the standard; 

5 ‘‘(II) the savings in operating 

6 costs throughout the estimated aver7 age life of the product in the type (or 

8 class) compared to any increase in the 

9 price of, or in the initial charges for, 

10 or maintenance expenses of, the prod11 ucts that are likely to result from the 

12 imposition of the standard; 

13 ‘‘(III) the total projected quan14 tity of energy savings likely to result 

15 directly from the imposition of the 

16 standard; 

17 ‘‘(IV) any lessening of the utility 

18 or the performance of the products 

19 likely to result from the imposition of 

20 the standard; 

21 ‘‘(V) the impact of any lessening 

22 of competition, as determined in writ23 ing by the Attorney General, that is 

24 likely to result from the imposition of 

25 the standard; 


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1 ‘‘(VI) the need for national en2 ergy conservation; and 

3 ‘‘(VII) other factors the Sec4 retary considers relevant. 

5 ‘‘(iii) ADMINISTRATION.— 

6 ‘‘(I) ENERGY USE AND EFFI7 CIENCY.—The Secretary may not pre8 scribe any amended standard under 

9 this paragraph that increases the 

10 maximum allowable energy use, or de11 creases the minimum required energy 

12 efficiency, of a covered product. 

13 ‘‘(II) UNAVAILABILITY.— 

14 ‘‘(aa) IN GENERAL.—The 

15 Secretary may not prescribe an 

16 amended standard under this 

17 subparagraph if the Secretary 

18 finds (and publishes the finding) 

19 that interested persons have es20 tablished by a preponderance of 

21 the evidence that a standard is 

22 likely to result in the unavail23 ability in the United States in 

24 any product type (or class) of 

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1 cluding reliability, features, sizes, 

2 capacities, and volumes) that are 

3 substantially the same as those 

4 generally available in the United 

5 States at the time of the finding 

6 of the Secretary. 

7 ‘‘(bb) OTHER TYPES OR

8 CLASSES.—The failure of some 

9 types (or classes) to meet the cri10 terion established under this sub11 clause shall not affect the deter12 mination of the Secretary on 

13 whether to prescribe a standard 

14 for the other types or classes.’’; 

15 and 

16 (B) in subparagraph (C)(iv), by striking ‘‘An 

17 amendment prescribed under this subsection’’ and 

18 inserting ‘‘Notwithstanding subparagraph (D), an 

19 amendment prescribed under this subparagraph’’. 

20 (5) Section 342(a)(6)(B)(iii) of the Energy Policy 

21 and Conservation Act (as added by section 306(c) of the 

22 Energy Independence and Security Act of 2007) is trans23 ferred and redesignated as clause (vi) of section 

24 342(a)(6)(C) of the Energy Policy and Conservation Act 


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1 (as amended by section 305(b)(2) of the Energy Independ2 ence and Security Act of 2007). 

3 (6) Section 340 of the Energy Policy and Conserva4 tion Act (42 U.S.C. 6311) (as amended by sections 

5 312(a)(2) and 314(a) of the Energy Independence and Se6 curity Act of 2007 (121 Stat. 1564, 1569)) is amended 

7 by redesignating paragraphs (22) and (23) (as added by 

8 section 314(a) of that Act) as paragraphs (23) and (24), 

9 respectively. 

10 (7) Section 345 of the Energy Policy and Conserva11 tion Act (42 U.S.C. 6316) (as amended by section 312(e) 

12 of the Energy Independence and Security Act of 2007 

13 (121 Stat. 1567)) is amended— 

14 (A) by striking ‘‘subparagraphs (B) through 

15 (G)’’ each place it appears and inserting ‘‘subpara16 graphs (B), (C), (D), (I), (J), and (K)’’; 

17 (B) by striking ‘‘part A’’ each place it appears 

18 and inserting ‘‘part B’’; and 

19 (C) in subsection (h)(3), by striking ‘‘section 

20 342(f)(3)’’ and inserting ‘‘section 342(f)(4)’’. 

21 (8) Section 340(13) of the Energy Policy and Con22 servation Act (42 U.S.C. 6311(13)) (as amended by sec23 tion 313(a) of the Energy Independence and Security Act 

24 of 2007 (121 Stat. 1568)) is amended— 


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1 (A) by striking subparagraphs (A) and (B) and 

2 inserting the following: 

3 ‘‘(A) IN GENERAL.—The term ‘electric 

4 motor’ means any motor that is— 

5 ‘‘(i) a general purpose T-frame, sin6 gle-speed, foot-mounting, polyphase squir7 rel-cage induction motor of the National 

8 Electrical Manufacturers Association, De9 sign A and B, continuous rated, operating 

10 on 230/460 volts and constant 60 Hertz 

11 line power as defined in NEMA Standards 

12 Publication MG1-1987; or 

13 ‘‘(ii) a motor incorporating the design 

14 elements described in clause (i), but is con15 figured to incorporate one or more of the 

16 following variations— 

17 ‘‘(I) U-frame motor; 

18 ‘‘(II) NEMA Design C motor; 

19 ‘‘(III) close-coupled pump motor; 

20 ‘‘(IV) footless motor; 

21 ‘‘(V) vertical solid shaft normal 

22 thrust motor (as tested in a horizontal 

23 configuration); 

24 ‘‘(VI) 8-pole motor; or 


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1 ‘‘(VII) poly-phase motor with a 

2 voltage rating of not more than 600 

3 volts (other than 230 volts or 460 

4 volts, or both, or can be operated on 

5 230 volts or 460 volts, or both).’’; and 

6 (B) by redesignating subparagraphs (C) 

7 through (I) as subparagraphs (B) through (H), re8 spectively. 

9 (9)(A) Section 342(b) of the Energy Policy and Con10 servation Act (42 U.S.C. 6313(b)) is amended— 

11 (i) in paragraph (1), by striking ‘‘paragraph (2)’’ and 

12 inserting ‘‘paragraph (3)’’; 

13 (ii) by redesignating paragraphs (2) and (3) as para14 graphs (3) and (4); 

15 (iii) by inserting after paragraph (1) the following: 

16 ‘‘(2) STANDARDS EFFECTIVE BEGINNING DE17 CEMBER 19, 2010.— 

18 ‘‘(A) IN GENERAL.—Except for definite 

19 purpose motors, special purpose motors, and 

20 those motors exempted by the Secretary under 

21 paragraph (3) and except as provided for in 

22 subparagraphs (B), (C), and (D), each electric 

23 motor manufactured with power ratings from 1 

24 to 200 horsepower (alone or as a component of 

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1 ber 19, 2010, shall have a nominal full load ef2 ficiency of not less than the nominal full load 

3 efficiency described in NEMA MG-1 (2006) 

4 Table 12-12. 

5 ‘‘(B) FIRE PUMP ELECTRIC MOTORS.—Ex6 cept for those motors exempted by the Sec7 retary under paragraph (3), each fire pump 

8 electric motor manufactured with power ratings 

9 from 1 to 200 horsepower (alone or as a compo10 nent of another piece of equipment) on or after 

11 December 19, 2010, shall have a nominal full 

12 load efficiency that is not less than the nominal 

13 full load efficiency described in NEMA MG-1 

14 (2006) Table 12-11. 

15 ‘‘(C) NEMA DESIGN B ELECTRIC MO16 TORS.—Except for those motors exempted by 

17 the Secretary under paragraph (3), each 

18 NEMA Design B electric motor with power rat19 ings of more than 200 horsepower, but not 

20 greater than 500 horsepower, manufactured 

21 (alone or as a component of another piece of 

22 equipment) on or after December 19, 2010, 

23 shall have a nominal full load efficiency of not 

24 less than the nominal full load efficiency de25 scribed in NEMA MG-1 (2006) Table 12-11. 


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1 ‘‘(D) MOTORS INCORPORATING CERTAIN

2 DESIGN ELEMENTS.—Except for those motors 

3 exempted by the Secretary under paragraph 

4 (3), each electric motor described in section 

5 340(13)(A)(ii) manufactured with power rat6 ings from 1 to 200 horsepower (alone or as a 

7 component of another piece of equipment) on or 

8 after December 19, 2010, shall have a nominal 

9 full load efficiency of not less than the nominal 

10 full load efficiency described in NEMA MG-1 

11 (2006) Table 12-11.’’; and 

12 (iv) in paragraph (3) (as redesignated by clause (ii)), 

13 by striking ‘‘paragraph (1)’’ each place it appears in sub14 paragraphs (A) and (D) and inserting ‘‘paragraphs (1) 

15 and (2)’’. 

16 (B) Section 313 of the Energy Independence and Se17 curity Act of 2007 (121 Stat. 1568) is repealed. 

18 (C) The amendments made by— 

19 (i) subparagraph (A) shall take effect on De20 cember 19, 2010; and 

21 (ii) subparagraph (B) shall take effect on De22 cember 19, 2007. 

23 (10) Section 321(30)(D)(i)(III) of the Energy Policy 

24 and Conservation Act (42 U.S.C. 6291(30)(D)(i)(III)) (as 

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1 ence and Security Act of 2007 (121 Stat. 1574)) is 

2 amended by inserting before the semicolon the following: 

3 ‘‘or, in the case of a modified spectrum lamp, not less than 

4 232 lumens and not more than 1,950 lumens’’. 

5 (11) Section 321(30)(T) of the Energy Policy and 

6 Conservation Act (42 U.S.C. 6291(30)(T) (as amended by 

7 section 321(a)(1)(B) of the Energy Independence and Se8 curity Act of 2007 (121 Stat. 1574)) is amended— 

9 (A) in clause (i)— 

10 (i) by striking the comma after ‘‘household 

11 appliance’’ and inserting ‘‘and’’; and 

12 (ii) by striking ‘‘and is sold at retail,’’; and 

13 (B) in clause (ii), by inserting ‘‘when sold at re14 tail,’’ before ‘‘is designated’’. 

15 (12) Section 325 of the Energy Policy and Conserva16 tion Act (42 U.S.C. 6295) (as amended by sections 

17 321(a)(3)(A) and 322(b) of the Energy Independence and 

18 Security Act of 2007 (121 Stat. 1577, 1588)) is amended 

19 by striking subsection (i) and inserting the following: 

20 ‘‘(i) GENERAL SERVICE FLUORESCENT LAMPS, GEN21 ERAL SERVICE INCANDESCENT LAMPS, INTERMEDIATE

22 BASE INCANDESCENT LAMPS, CANDELABRA BASE INCAN23 DESCENT LAMPS, AND INCANDESCENT REFLECTOR

24 LAMPS.— 

25 ‘‘(1) ENERGY EFFICIENCY STANDARDS.— 


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1 ‘‘(A) IN GENERAL.—Each of the following 

2 general service fluorescent lamps, general serv3 ice incandescent lamps, intermediate base in4 candescent lamps, candelabra base incandescent 

5 lamps, and incandescent reflector lamps manu6 factured after the effective date specified in the 

7 tables listed in this subparagraph shall meet or 

8 exceed the following lamp efficacy, new max9 imum wattage, and CRI standards: 

‘‘FLUORESCENT LAMPS 

Lamp Type 

Nominal 

Lamp 

Wattage 

Minimum 

CRI 

Minimum Average 

Lamp Efficacy 

(LPW) 

Effective 

Date (Period of 

Months) 

4-foot medium bi-pin ................. >35 W 69 75.0 36 

.................................................... ≤35 W 45 75.0 36 

2-foot U-shaped ......................... >35 W 69 68.0 36 

.................................................... ≤35 W 45 64.0 36 

8-foot slimline ............................ 65 W 69 80.0 18 

.................................................... ≤65 W 45 80.0 18 

8-foot high output ...................... >100 W 69 80.0 18 

.................................................... ≤100 W 45 80.0 18 

‘‘INCANDESCENT REFLECTOR LAMPS 

Nominal Lamp Wattage 

Minimum Average 

Lamp Efficacy 

(LPW) 

Effective 

Date (Period of 

Months) 

40–50 ...................................................................................... 10.5 36 

51–66 ...................................................................................... 11.0 36 

67–85 ...................................................................................... 12.5 36 

86–115 .................................................................................... 14.0 36 

116–155 .................................................................................... 14.5 36 

156–205 .................................................................................... 15.0 36 

‘‘GENERAL SERVICE INCANDESCENT LAMPS 

Rated Lumen Ranges Maximum Rated 

Wattage 

Minimum 

Rated Lifetime 

Effective 

Date 

1490–2600 72 1,000 hrs 1/1/2012 

1050–1489 53 1,000 hrs 1/1/2013 

750–1049 43 1,000 hrs 1/1/2014 

310–749 29 1,000 hrs 1/1/2014 


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‘‘MODIFIED SPECTRUM GENERAL SERVICE INCANDESCENT LAMPS 

Rated Lumen Ranges Maximum Rated 

Wattage 

Minimum 

Rated Lifetime 

Effective 

Date 

1118–1950 72 1,000 hrs 1/1/2012 

788–1117 53 1,000 hrs 1/1/2013 

563–787 43 1,000 hrs 1/1/2014 

232–562 29 1,000 hrs 1/1/2014 

1 ‘‘(B) APPLICATION.— 

2 ‘‘(i) APPLICATION CRITERIA.—This 

3 subparagraph applies to each lamp that— 

4 ‘‘(I) is intended for a general 

5 service or general illumination applica6 tion (whether incandescent or not); 

7 ‘‘(II) has a medium screw base 

8 or any other screw base not defined in 

9 ANSI C81.61–2006; 

10 ‘‘(III) is capable of being oper11 ated at a voltage at least partially 

12 within the range of 110 to 130 volts; 

13 and 

14 ‘‘(IV) is manufactured or im15 ported after December 31, 2011. 

16 ‘‘(ii) REQUIREMENT.—For purposes 

17 of this paragraph, each lamp described in 

18 clause (i) shall have a color rendering 

19 index that is greater than or equal to— 


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1 ‘‘(I) 80 for nonmodified spectrum 

2 lamps; or 

3 ‘‘(II) 75 for modified spectrum 

4 lamps. 

5 ‘‘(C) CANDELABRA INCANDESCENT LAMPS

6 AND INTERMEDIATE BASE INCANDESCENT

7 LAMPS.— 

8 ‘‘(i) CANDELABRA BASE INCANDES9 CENT LAMPS.—Effective beginning Janu10 ary 1, 2012, a candelabra base incandes11 cent lamp shall not exceed 60 rated watts. 

12 ‘‘(ii) INTERMEDIATE BASE INCANDES13 CENT LAMPS.—Effective beginning Janu14 ary 1, 2012, an intermediate base incan15 descent lamp shall not exceed 40 rated 

16 watts. 

17 ‘‘(D) EXEMPTIONS.— 

18 ‘‘(i) STATUTORY EXEMPTIONS.—The 

19 standards specified in subparagraph (A) 

20 shall not apply to the following types of in21 candescent reflector lamps: 

22 ‘‘(I) Lamps rated at 50 watts or 

23 less that are ER30, BR30, BR40, or 

24 ER40 lamps. 


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1 ‘‘(II) Lamps rated at 65 watts 

2 that are BR30, BR40, or ER40 

3 lamps. 

4 ‘‘(III) R20 incandescent reflector 

5 lamps rated 45 watts or less. 

6 ‘‘(ii) ADMINISTRATIVE EXEMP7 TIONS.— 

8 ‘‘(I) PETITION.—Any person may 

9 petition the Secretary for an exemp10 tion for a type of general service lamp 

11 from the requirements of this sub12 section. 

13 ‘‘(II) CRITERIA.—The Secretary 

14 may grant an exemption under sub15 clause (I) only to the extent that the 

16 Secretary finds, after a hearing and 

17 opportunity for public comment, that 

18 it is not technically feasible to serve a 

19 specialized lighting application (such 

20 as a military, medical, public safety, 

21 or certified historic lighting applica22 tion) using a lamp that meets the re23 quirements of this subsection. 

24 ‘‘(III) ADDITIONAL CRITERION.— 

25 To grant an exemption for a product 


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1 under this clause, the Secretary shall 

2 include, as an additional criterion, 

3 that the exempted product is unlikely 

4 to be used in a general service lighting 

5 application. 

6 ‘‘(E) EXTENSION OF COVERAGE.— 

7 ‘‘(i) PETITION.—Any person may peti8 tion the Secretary to establish standards 

9 for lamp shapes or bases that are excluded 

10 from the definition of general service 

11 lamps. 

12 ‘‘(ii) INCREASED SALES OF EXEMPT13 ED LAMPS.—The petition shall include evi14 dence that the availability or sales of ex15 empted incandescent lamps have increased 

16 significantly since the date on which the 

17 standards on general service incandescent 

18 lamps were established. 

19 ‘‘(iii) CRITERIA.—The Secretary shall 

20 grant a petition under clause (i) if the Sec21 retary finds that— 

22 ‘‘(I) the petition presents evi23 dence that demonstrates that commer24 cial availability or sales of exempted 

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1 creased significantly since the stand2 ards on general service lamps were es3 tablished and likely are being widely 

4 used in general lighting applications; 

5 and 

6 ‘‘(II) significant energy savings 

7 could be achieved by covering exempt8 ed products, as determined by the 

9 Secretary based in part on sales data 

10 provided to the Secretary from manu11 facturers and importers. 

12 ‘‘(iv) NO PRESUMPTION.—The grant 

13 of a petition under this subparagraph shall 

14 create no presumption with respect to the 

15 determination of the Secretary with respect 

16 to any criteria under a rulemaking con17 ducted under this section. 

18 ‘‘(v) EXPEDITED PROCEEDING.—If 

19 the Secretary grants a petition for a lamp 

20 shape or base under this subparagraph, 

21 the Secretary shall— 

22 ‘‘(I) conduct a rulemaking to de23 termine standards for the exempted 

24 lamp shape or base; and 


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1 ‘‘(II) complete the rulemaking 

2 not later than 18 months after the 

3 date on which notice is provided 

4 granting the petition. 

5 ‘‘(F) EFFECTIVE DATES.— 

6 ‘‘(i) IN GENERAL.—In this paragraph, 

7 except as otherwise provided in a table 

8 contained in subparagraph (A) or in clause 

9 (ii), the term ‘effective date’ means the last 

10 day of the month specified in the table 

11 that follows October 24, 1992. 

12 ‘‘(ii) SPECIAL EFFECTIVE DATES.— 

13 ‘‘(I) ER, BR, AND BPAR

14 LAMPS.—The standards specified in 

15 subparagraph (A) shall apply with re16 spect to ER incandescent reflector 

17 lamps, BR incandescent reflector 

18 lamps, BPAR incandescent reflector 

19 lamps, and similar bulb shapes on and 

20 after January 1, 2008, or the date 

21 that is 180 days after the date of en22 actment of the Energy Independence 

23 and Security Act of 2007. 

24 ‘‘(II) LAMPS BETWEEN 2.25–2.75

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1 ards specified in subparagraph (A) 

2 shall apply with respect to incandes3 cent reflector lamps with a diameter 

4 of more than 2.25 inches, but not 

5 more than 2.75 inches, on and after 

6 the later of January 1, 2008, or the 

7 date that is 180 days after the date of 

8 enactment of the Energy Independ9 ence and Security Act of 2007. 

10 ‘‘(2) COMPLIANCE WITH EXISTING LAW.—Not11 withstanding section 332(a)(5) and section 332(b), 

12 it shall not be unlawful for a manufacturer to sell 

13 a lamp that is in compliance with the law at the 

14 time the lamp was manufactured. 

15 ‘‘(3) RULEMAKING BEFORE OCTOBER 24, 

16 1995.— 

17 ‘‘(A) IN GENERAL.—Not later than 36 

18 months after October 24, 1992, the Secretary 

19 shall initiate a rulemaking procedure and shall 

20 publish a final rule not later than the end of 

21 the 54-month period beginning on October 24, 

22 1992, to determine whether the standards es23 tablished under paragraph (1) should be 

24 amended. 


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1 ‘‘(B) ADMINISTRATION.—The rule shall 

2 contain the amendment, if any, and provide 

3 that the amendment shall apply to products 

4 manufactured on or after the 36-month period 

5 beginning on the date on which the final rule is 

6 published. 

7 ‘‘(4) RULEMAKING BEFORE OCTOBER 24, 

8 2000.— 

9 ‘‘(A) IN GENERAL.—Not later than 8 years 

10 after October 24, 1992, the Secretary shall ini11 tiate a rulemaking procedure and shall publish 

12 a final rule not later than 9 years and 6 months 

13 after October 24, 1992, to determine whether 

14 the standards in effect for fluorescent lamps 

15 and incandescent lamps should be amended. 

16 ‘‘(B) ADMINISTRATION.—The rule shall 

17 contain the amendment, if any, and provide 

18 that the amendment shall apply to products 

19 manufactured on or after the 36-month period 

20 beginning on the date on which the final rule is 

21 published. 

22 ‘‘(5) RULEMAKING FOR ADDITIONAL GENERAL

23 SERVICE FLUORESCENT LAMPS.— 

24 ‘‘(A) IN GENERAL.—Not later than the 

25 end of the 24-month period beginning on the 


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1 date labeling requirements under section 

2 324(a)(2)(C) become effective, the Secretary 

3 shall— 

4 ‘‘(i) initiate a rulemaking procedure to 

5 determine whether the standards in effect 

6 for fluorescent lamps and incandescent 

7 lamps should be amended so that the 

8 standards would be applicable to additional 

9 general service fluorescent lamps; and 

10 ‘‘(ii) publish, not later than 18 

11 months after initiating the rulemaking, a 

12 final rule including the amended stand13 ards, if any. 

14 ‘‘(B) ADMINISTRATION.—The rule shall 

15 provide that the amendment shall apply to 

16 products manufactured after a date which is 36 

17 months after the date on which the rule is pub18 lished. 

19 ‘‘(6) STANDARDS FOR GENERAL SERVICE

20 LAMPS.— 

21 ‘‘(A) RULEMAKING BEFORE JANUARY 1, 

22 2014.— 

23 ‘‘(i) IN GENERAL.—Not later than 

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1 tiate a rulemaking procedure to determine 

2 whether— 

3 ‘‘(I) standards in effect for gen4 eral service lamps should be amended; 

5 and 

6 ‘‘(II) the exclusions for certain 

7 incandescent lamps should be main8 tained or discontinued based, in part, 

9 on excluded lamp sales collected by 

10 the Secretary from manufacturers. 

11 ‘‘(ii) SCOPE.—The rulemaking— 

12 ‘‘(I) shall not be limited to incan13 descent lamp technologies; and 

14 ‘‘(II) shall include consideration 

15 of a minimum standard of 45 lumens 

16 per watt for general service lamps. 

17 ‘‘(iii) AMENDED STANDARDS.—If the 

18 Secretary determines that the standards in 

19 effect for general service lamps should be 

20 amended, the Secretary shall publish a 

21 final rule not later than January 1, 2017, 

22 with an effective date that is not earlier 

23 than 3 years after the date on which the 

24 final rule is published. 


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1 ‘‘(iv) PHASED-IN EFFECTIVE

2 DATES.—The Secretary shall consider 

3 phased-in effective dates under this sub4 paragraph after considering— 

5 ‘‘(I) the impact of any amend6 ment on manufacturers, retiring and 

7 repurposing existing equipment, 

8 stranded investments, labor contracts, 

9 workers, and raw materials; and 

10 ‘‘(II) the time needed to work 

11 with retailers and lighting designers 

12 to revise sales and marketing strate13 gies. 

14 ‘‘(v) BACKSTOP REQUIREMENT.—If 

15 the Secretary fails to complete a rule16 making in accordance with clauses (i) 

17 through (iv) or if the final rule does not 

18 produce savings that are greater than or 

19 equal to the savings from a minimum effi20 cacy standard of 45 lumens per watt, effec21 tive beginning January 1, 2020, the Sec22 retary shall prohibit the manufacture of 

23 any general service lamp that does not 

24 meet a minimum efficacy standard of 45 

25 lumens per watt. 


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1 ‘‘(vi) STATE PREEMPTION.—Neither 

2 section 327(c) nor any other provision of 

3 law shall preclude California or Nevada 

4 from adopting, effective beginning on or 

5 after January 1, 2018— 

6 ‘‘(I) a final rule adopted by the 

7 Secretary in accordance with clauses 

8 (i) through (iv); 

9 ‘‘(II) if a final rule described in 

10 subclause (I) has not been adopted, 

11 the backstop requirement under 

12 clause (v); or 

13 ‘‘(III) in the case of California, if 

14 a final rule described in subclause (I) 

15 has not been adopted, any California 

16 regulations relating to these covered 

17 products adopted pursuant to State 

18 statute in effect as of the date of en19 actment of the Energy Independence 

20 and Security Act of 2007. 

21 ‘‘(B) RULEMAKING BEFORE JANUARY 1, 

22 2020.— 

23 ‘‘(i) IN GENERAL.—Not later than 

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1 tiate a rulemaking procedure to determine 

2 whether— 

3 ‘‘(I) standards in effect for gen4 eral service lamps should be amended; 

5 and 

6 ‘‘(II) the exclusions for certain 

7 incandescent lamps should be main8 tained or discontinued based, in part, 

9 on excluded lamp sales data collected 

10 by the Secretary from manufacturers. 

11 ‘‘(ii) SCOPE.—The rulemaking shall 

12 not be limited to incandescent lamp tech13 nologies. 

14 ‘‘(iii) AMENDED STANDARDS.—If the 

15 Secretary determines that the standards in 

16 effect for general service lamps should be 

17 amended, the Secretary shall publish a 

18 final rule not later than January 1, 2022, 

19 with an effective date that is not earlier 

20 than 3 years after the date on which the 

21 final rule is published. 

22 ‘‘(iv) PHASED-IN EFFECTIVE

23 DATES.—The Secretary shall consider 

24 phased-in effective dates under this sub25 paragraph after considering— 


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1 ‘‘(I) the impact of any amend2 ment on manufacturers, retiring and 

3 repurposing existing equipment, 

4 stranded investments, labor contracts, 

5 workers, and raw materials; and 

6 ‘‘(II) the time needed to work 

7 with retailers and lighting designers 

8 to revise sales and marketing strate9 gies. 

10 ‘‘(7) FEDERAL ACTIONS.— 

11 ‘‘(A) COMMENTS OF SECRETARY.— 

12 ‘‘(i) IN GENERAL.—With respect to 

13 any lamp to which standards are applicable 

14 under this subsection or any lamp specified 

15 in section 346, the Secretary shall inform 

16 any Federal entity proposing actions that 

17 would adversely impact the energy con18 sumption or energy efficiency of the lamp 

19 of the energy conservation consequences of 

20 the action. 

21 ‘‘(ii) CONSIDERATION.—The Federal 

22 entity shall carefully consider the com23 ments of the Secretary. 

24 ‘‘(B) AMENDMENT OF STANDARDS.—Not25 withstanding section 325(n)(1), the Secretary 


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1 shall not be prohibited from amending any 

2 standard, by rule, to permit increased energy 

3 use or to decrease the minimum required en4 ergy efficiency of any lamp to which standards 

5 are applicable under this subsection if the ac6 tion is warranted as a result of other Federal 

7 action (including restrictions on materials or 

8 processes) that would have the effect of either 

9 increasing the energy use or decreasing the en10 ergy efficiency of the product. 

11 ‘‘(8) COMPLIANCE.— 

12 ‘‘(A) IN GENERAL.—Not later than the 

13 date on which standards established pursuant 

14 to this subsection become effective, or, with re15 spect to high-intensity discharge lamps covered 

16 under section 346, the effective date of stand17 ards established pursuant to that section, each 

18 manufacturer of a product to which the stand19 ards are applicable shall file with the Secretary 

20 a laboratory report certifying compliance with 

21 the applicable standard for each lamp type. 

22 ‘‘(B) CONTENTS.—The report shall include 

23 the lumen output and wattage consumption for 

24 each lamp type as an average of measurements 

25 taken over the preceding 12-month period. 


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1 ‘‘(C) OTHER LAMP TYPES.—With respect 

2 to lamp types that are not manufactured during 

3 the 12-month period preceding the date on 

4 which the standards become effective, the re5 port shall— 

6 ‘‘(i) be filed with the Secretary not 

7 later than the date that is 12 months after 

8 the date on which manufacturing is com9 menced; and 

10 ‘‘(ii) include the lumen output and 

11 wattage consumption for each such lamp 

12 type as an average of measurements taken 

13 during the 12-month period.’’. 

14 (13) Section 325(l)(4)(A) of the Energy Policy and 

15 Conservation Act (42 U.S.C. 6295(l)(4)(A)) (as amended 

16 by section 321(a)(3)(B) of the Energy Independence and 

17 Security Act of 2007 (121 Stat. 1581)) is amended by 

18 striking ‘‘only’’. 

19 (14) Section 327(b)(1)(B) of the Energy Policy and 

20 Conservation Act (42 U.S.C. 6297(b)(1)(B)) (as amended 

21 by section 321(d)(3) of the Energy Independence and Se22 curity Act of 2007 (121 Stat. 1585)) is amended— 

23 (A) in clause (i), by inserting ‘‘and’’ after the 

24 semicolon at the end; 


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1 (B) in clause (ii), by striking ‘‘; and’’ and in2 serting a period; and 

3 (C) by striking clause (iii). 

4 (15) Section 321(e) of the Energy Independence and 

5 Security Act of 2007 (121 Stat. 1586) is amended— 

6 (A) in the matter preceding paragraph (1), by 

7 striking ‘‘is amended’’ and inserting ‘‘(as amended 

8 by section 306(b)) is amended’’; and 

9 (B) by striking paragraphs (1) and (2) and in10 serting the following: 

11 ‘‘(1) in paragraph (5), by striking ‘or’ after the 

12 semicolon at the end; 

13 ‘‘(2) in paragraph (6), by striking the period at 

14 the end and inserting ‘; or’; and’’. 

15 (16) Section 332(a) of the Energy Policy and Con16 servation Act (42 U.S.C. 6302(a)) (as amended by section 

17 321(e) of the Energy Independence and Security Act of 

18 2007 (121 Stat. 1586)) is amended by redesignating the 

19 second paragraph (6) as paragraph (7). 

20 (17) Section 321(30)(C)(ii) of the Energy Policy and 

21 Conservation Act (42 U.S.C. 6291(30)(C)(ii)) (as amend22 ed by section 322(a)(1)(B) of the Energy Independence 

23 and Security Act of 2007 (121 Stat. 1587)) is amended 

24 by inserting a period after ‘‘40 watts or higher’’. 


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1 (18) Section 322(b) of the Energy Independence and 

2 Security Act of 2007 (121 Stat. 1588)) is amended by 

3 striking ‘‘6995(i)’’ and inserting ‘‘6295(i)’’. 

4 (19) Section 327(c) of the Energy Policy and Con5 servation Act (42 U.S.C. 6297(c)) (as amended by sec6 tions 324(f) of the Energy Independence and Security Act 

7 of 2007 (121 Stat. 1594)) is amended— 

8 (A) in paragraph (6), by striking ‘‘or’’ after the 

9 semicolon at the end; 

10 (B) in paragraph (8)(B), by striking ‘‘and’’ 

11 after the semicolon at the end; 

12 (C) in paragraph (9)— 

13 (i) by striking ‘‘except that—’’ and all that 

14 follows through ‘‘if the Secretary fails to issue’’ 

15 and inserting ‘‘except that if the Secretary fails 

16 to issue’’; 

17 (ii) by redesignating clauses (i) and (ii) as 

18 subparagraphs (A) and (B), respectively (and 

19 by moving the margins of such subparagraphs 

20 2 ems to the left); and 

21 (iii) by striking the period at the end and 

22 inserting a semicolon; and 

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


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1 ‘‘(10) is a regulation for general service lamps 

2 that conforms with Federal standards and effective 

3 dates; 

4 ‘‘(11) is an energy efficiency standard for gen5 eral service lamps enacted into law by the State of 

6 Nevada prior to December 19, 2007, if the State has 

7 not adopted the Federal standards and effective 

8 dates pursuant to subsection (b)(1)(B)(ii); or’’. 

9 (20) Section 325(b) of the Energy Independence and 

10 Security Act of 2007 (121 Stat. 1596)) is amended by 

11 striking ‘‘6924(c)’’ and inserting ‘‘6294(c)’’. 

12 (b) TITLE IV—ENERGY SAVINGS IN BUILDINGS AND

13 INDUSTRY.—(1) Section 401 of the Energy Independence 

14 and Security Act of 2007 (42 U.S.C. 17061) is amend15 ed— 

16 (A) in paragraph (2), by striking ‘‘484’’ and in17 serting ‘‘494’’; and 

18 (B) in paragraph (13), by striking ‘‘Agency’’ 

19 and inserting ‘‘Administration’’. 

20 (2) Section 422 of the Energy Conservation and Pro21 duction Act (42 U.S.C. 6872) (as amended by section 

22 411(a) of the Energy Independence and Security Act of 

23 2007 (121 Stat. 1600)) is amended by striking 1 of the 

24 2 periods at the end of paragraph (5). 


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1 (3) Section 305(a)(3)(D)(i) of the Energy Conserva2 tion and Production Act (42 U.S.C. 6834(a)(3)(D)(i)) (as 

3 amended by section 433(a) of the Energy Independence 

4 and Security Act of 2007 (121 Stat. 1612)) is amended— 

5 (A) in subclause (I)— 

6 (i) by striking ‘‘in fiscal year 2003 (as 

7 measured by Commercial Buildings Energy 

8 Consumption Survey or Residential Energy 

9 Consumption Survey data from the Energy In10 formation Agency’’ and inserting ‘‘as measured 

11 by the calendar year 2003 Commercial Build12 ings Energy Consumption Survey or the cal13 endar year 2005 Residential Energy Consump14 tion Survey data from the Energy Information 

15 Administration’’; and 

16 (ii) in the table at the end, by striking 

17 ‘‘Fiscal Year’’ and inserting ‘‘Calendar 

18 Year’’; and 

19 (B) in subclause (II)— 

20 (i) by striking ‘‘(II) Upon petition’’ and in21 serting the following: 

22 ‘‘(II) DOWNWARD ADJUSTMENT

23 OF NUMERIC REQUIREMENT.— 

24 ‘‘(aa) IN GENERAL.—On pe25 tition’’; and 


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1 (ii) by striking the last sentence and in2 serting the following: 

3 ‘‘(bb) EXCEPTIONS TO RE4 QUIREMENT FOR CONCURRENCE

5 OF SECRETARY.— 

6 ‘‘(AA) IN GENERAL.— 

7 The requirement to petition 

8 and obtain the concurrence 

9 of the Secretary under this 

10 subclause shall not apply to 

11 any Federal building with 

12 respect to which the Admin13 istrator of General Services 

14 is required to transmit a 

15 prospectus to Congress 

16 under section 3307 of title 

17 40, United States Code, or 

18 to any other Federal build19 ing designed, constructed, or 

20 renovated by the Adminis21 trator if the Administrator 

22 certifies, in writing, that 

23 meeting the applicable nu24 meric requirement under 

25 subclause (I) with respect to 


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1 the Federal building would 

2 be technically impracticable 

3 in light of the specific func4 tional needs for the building. 

5 ‘‘(BB) ADJUSTMENT.— 

6 In the case of a building de7 scribed in subitem (AA), the 

8 Administrator may adjust 

9 the applicable numeric re10 quirement of subclause (I) 

11 downward with respect to 

12 the building.’’. 

13 (4) Section 436(c)(3) of the Energy Independence 

14 and Security Act of 2007 (42 U.S.C. 17092(c)(3)) is 

15 amended by striking ‘‘474’’ and inserting ‘‘494’’. 

16 (5) Section 440 of the Energy Independence and Se17 curity Act of 2007 (42 U.S.C. 17096) is amended by strik18 ing ‘‘and 482’’. 

19 (6) Section 373(c) of the Energy Policy and Con20 servation Act (42 U.S.C. 6343(c)) (as amended by section 

21 451(a) of the Energy Independence and Security Act of 

22 2007 (121 Stat. 1628)) is amended by striking ‘‘Adminis23 trator’’ and inserting ‘‘Secretary’’. 

24 (c) DATE OF ENACTMENT.—Section 1302 of the En25 ergy Independence and Security Act of 2007 (42 U.S.C. 


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1 17382) is amended in the first sentence by striking ‘‘en2 actment’’ and inserting ‘‘the date of enactment of this 

3 Act’’. 

4 (d) REFERENCE.—Section 1306(c)(3) of the Energy 

5 Independence and Security Act of 2007 (42 U.S.C. 

6 17386(c)(3)) is amended by striking ‘‘section 1307 (para7 graph (17) of section 111(d) of the Public Utility Regu8 latory Policies Act of 1978)’’ and inserting ‘‘paragraph 

9 (19) of section 111(d) of the Public Utility Regulatory 

10 Policies Act of 1978 (16 U.S.C. 2621(d))’’. 

11 (e) EFFECTIVE DATE.—This section and the amend12 ments made by this section take effect as if included in 

13 the Energy Independence and Security Act of 2007 (Pub14 lic Law 110–140; 121 Stat. 1492). 

15 SEC. 162. TECHNICAL CORRECTIONS TO ENERGY POLICY 

16 ACT OF 2005. 

17 (a) TITLE I—ENERGY EFFICIENCY.—Section 

18 325(g)(8)(C)(ii) of the Energy Policy and Conservation 

19 Act (42 U.S.C. 6295(g)(8)(C)(ii)) (as added by section 

20 135(c)(2)(B) of the Energy Policy Act of 2005) is amend21 ed by striking ‘‘20°F’’ and inserting ‘‘¥20°F’’. 

22 (b) EFFECTIVE DATE.—This section and the amend23 ments made by this section take effect as if included in 

24 the Energy Policy Act of 2005 (Public Law 109–58; 119 

25 Stat. 594). 


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1 Subtitle H—Energy and Efficiency 

2 Centers and Research 

3 SEC. 171. ENERGY INNOVATION HUBS. 

4 (a) PURPOSE.—The Secretary shall carry out a pro5 gram to establish Energy Innovation Hubs to enhance the 

6 Nation’s economic, environmental, and energy security by 

7 promoting commercial application of clean, indigenous en8 ergy alternatives to oil and other fossil fuels, reducing 

9 greenhouse gas emissions, and ensuring that the United 

10 States maintains a technological lead in the development 

11 and commercial application of state-of-the-art energy tech12 nologies. To achieve these purposes the program shall— 

13 (1) leverage the expertise and resources of the 

14 university and private research communities, indus15 try, venture capital, national laboratories, and other 

16 participants in energy innovation to support cross17 disciplinary research and development in areas not 

18 being served by the private sector in order to develop 

19 and transfer innovative clean energy technologies 

20 into the marketplace; 

21 (2) expand the knowledge base and human cap22 ital necessary to transition to a low-carbon economy; 

23 and 

24 (3) promote regional economic development by 

25 cultivating clusters of clean energy technology firms, 


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1 private research organizations, suppliers, and other 

2 complementary groups and businesses. 

3 (b) DEFINITIONS.—For purposes of this section: 

4 (1) ALLOWANCE.—The term ‘‘allowance’’ 

5 means an emission allowance established under sec6 tion 721 of the Clean Air Act (as added by section 

7 311 of this Act). 

8 (2) CLEAN ENERGY TECHNOLOGY.—The term 

9 ‘‘clean energy technology’’ means a technology 

10 that— 

11 (A) produces energy from solar, wind, geo12 thermal, biomass, tidal, wave, ocean, and other 

13 renewable energy resources (as such term is de14 fined in section 610 of the Public Utility Regu15 latory Policies Act of 1978); 

16 (B) more efficiently transmits, distributes, 

17 or stores energy; 

18 (C) enhances energy efficiency for build19 ings and industry, including combined heat and 

20 power; 

21 (D) enables the development of a Smart 

22 Grid (as described in section 1301 of the En23 ergy Independence and Security Act of 2007 

24 (42 U.S.C. 17381)), including integration of re25 newable energy resources and distributed genVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00217 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 eration, demand response, demand side man2 agement, and systems analysis; 

3 (E) produces an advanced or sustainable 

4 material with energy or energy efficiency appli5 cations; 

6 (F) enhances water security through im7 proved water management, conservation, dis8 tribution, and end use applications; or 

9 (G) improves energy efficiency for trans10 portation, including electric vehicles. 

11 (3) CLUSTER.—The term ‘‘cluster’’ means a 

12 concentration of firms directly involved in the re13 search, development, finance, and commercialization 

14 of clean energy technologies whose geographic prox15 imity facilitates utilization and sharing of skilled 

16 human resources, infrastructure, research facilities, 

17 educational and training institutions, venture cap18 ital, and input suppliers. 

19 (4) HUB.—The term ‘‘Hub’’ means an Energy 

20 Innovation Hub established in accordance with this 

21 section. 

22 (5) PROJECT.—The term ‘‘project’’ means an 

23 activity with respect to which a Hub provides sup24 port under subsection (e). 


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1 (6) QUALIFYING ENTITY.—The term ‘‘quali2 fying entity’’ means each of the following: 

3 (A) A research university. 

4 (B) A State or Federal institution with a 

5 focus on the advancement of clean energy tech6 nologies. 

7 (C) A nongovernmental organization with 

8 research or commercialization expertise in clean 

9 energy technology development. 

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

11 the Secretary of Energy. 

12 (8) TECHNOLOGY DEVELOPMENT FOCUS.—The 

13 term ‘‘technology development focus’’ means the 

14 unique technology development areas in which a 

15 Hub will specialize, and may include solar electricity, 

16 fuels from solar energy, batteries and energy stor17 age, electricity grid systems and devices, energy effi18 cient building systems and design, advanced mate19 rials, modeling and simulation, and other clean en20 ergy technology development areas designated by the 

21 Secretary. 

22 (9) TRANSLATIONAL RESEARCH.—The term 

23 ‘‘translational research’’ means coordination of basic 

24 or applied research with technical and commercial 

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1 tions to attract investment sufficient for market pen2 etration and diffusion. 

3 (10) VINTAGE YEAR.—The term ‘‘vintage year’’ 

4 has the meaning given that term in section 700 of 

5 the Clean Air Act (as added by section 312 of this 

6 Act). 

7 (c) ROLE OF THE SECRETARY.—The Secretary 

8 shall— 

9 (1) have ultimate responsibility for, and over10 sight of, all aspects of the program under this sec11 tion; 

12 (2) provide for the distribution of allowances al13 located under section 782(h)(1) of the Clean Air Act 

14 (as added by section 321 of this Act) to support the 

15 establishment of 8 Hubs, each with a unique des16 ignated technology development focus, pursuant to 

17 this section; 

18 (3) coordinate the innovation activities of Hubs 

19 with those occurring through other Department of 

20 Energy entities, including the National Laboratories, 

21 the Advanced Research Projects Agency—Energy, 

22 and Energy Frontier Research Collaborations, and 

23 within industry, including by annually— 


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1 (A) issuing guidance regarding national 

2 energy research and development priorities and 

3 strategic objectives; and 

4 (B) convening a conference of staff of the 

5 Department of Energy and representatives from 

6 such other entities to share research results, 

7 program plans, and opportunities for collabora8 tion. 

9 (d) ENTITIES ELIGIBLE FOR SUPPORT.—A consor10 tium shall be eligible to receive allowances to support the 

11 establishment of a Hub under this section if— 

12 (1) it is composed of— 

13 (A) 2 research universities with a com14 bined annual research budget of $500,000,000; 

15 and 

16 (B) 1 or more additional qualifying enti17 ties; 

18 (2) its members have established a binding 

19 agreement that documents— 

20 (A) the structure of the partnership agree21 ment; 

22 (B) a governance and management struc23 ture to enable cost-effective implementation of 

24 the program; 


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1 (C) an intellectual property management 

2 policy; 

3 (D) a conflicts of interest policy consistent 

4 with subsection (e)(4); 

5 (E) an accounting structure that meets the 

6 requirements of the Department of Energy and 

7 can be audited under subsection (f)(5); and 

8 (F) that it has an Advisory Board con9 sistent with subsection (e)(3); 

10 (3) it receives financial contributions from 

11 States, consortium participants, or other non-Fed12 eral sources, to be used to support project awards 

13 pursuant to subsection (e); 

14 (4) it is part of an existing cluster or dem15 onstrates high potential to develop a new cluster; 

16 and 

17 (5) it operates as a nonprofit organization. 

18 (e) ENERGY INNOVATION HUBS.— 

19 (1) ROLE.—Hubs receiving allowances under 

20 this section shall support translational research ac21 tivities leading to commercial application of clean en22 ergy technologies, in accordance with the purposes of 

23 this section, through issuance of awards to projects 

24 managed by qualifying entities and other entities 


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1 meeting the Hub’s project criteria, including na2 tional laboratories. Each such Hub shall— 

3 (A) develop and publish for public review 

4 and comment proposed plans, programs, project 

5 selection criteria, and terms for individual 

6 project awards under this subsection; 

7 (B) submit an annual report to the Sec8 retary summarizing the Hub’s activities, organi9 zational expenditures, and Board members, 

10 which shall include a certification of compliance 

11 with conflict of interest policies and a descrip12 tion of each project in the research portfolio; 

13 (C) establish policies— 

14 (i) regarding intellectual property de15 veloped as a result of Hub awards and 

16 other forms of technology support that en17 courage individual ingenuity and invention 

18 while speeding technology transfer and fa19 cilitating the establishment of rapid com20 mercialization pathways; 

21 (ii) to prevent resources provided to 

22 the Hub from being used to displace pri23 vate sector investment otherwise likely to 

24 occur, including investment from private 


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1 sector entities that are members of the 

2 consortium; 

3 (iii) to facilitate the participation of 

4 private investment firms or other private 

5 entities that invest in clean energy tech6 nologies to perform due diligence on award 

7 proposals, to participate in the award re8 view process, and to provide guidance to 

9 projects supported by the Hub; and 

10 (iv) to facilitate the participation of 

11 entrepreneurs with a demonstrated history 

12 of developing and commercializing clean 

13 energy technologies; 

14 (D) oversee project solicitations, review 

15 proposed projects, and select projects for 

16 awards; and 

17 (E) monitor project implementation. 

18 (2) DISTRIBUTION OF AWARDS BY HUBS.—A 

19 Hub shall distribute awards under this subsection to 

20 support clean energy technology projects conducting 

21 translational research and related activities, provided 

22 that at least 50 percent of such support shall be pro23 vided to projects related to the Hub’s technology de24 velopment focus. 

25 (3) ADVISORY BOARDS.— 


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1 (A) IN GENERAL.—Each Hub shall estab2 lish an Advisory Board, the members of which 

3 shall have extensive and relevant scientific, 

4 technical, industry, financial, or research man5 agement expertise. The Advisory Board shall 

6 review the Hub’s proposed plans, programs, 

7 project selection criteria, and projects and shall 

8 ensure that projects selected for awards meet 

9 the conflict of interest policies of the Hub. Ad10 visory Board members other than those rep11 resenting consortium members shall serve for 

12 no more than 3 years. All Advisory Board mem13 bers shall comply with the Hub’s conflict of in14 terest policies and procedures. 

15 (B) MEMBERS.—Each Advisory Board 

16 shall consist of— 

17 (i) 5 members selected by the consor18 tium’s research universities; 

19 (ii) 2 members selected by the consor20 tium’s other qualifying entities; 

21 (iii) 2 members selected at large by 

22 other Advisory Board members to rep23 resent the entrepreneur and venture cap24 ital communities; and 


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1 (iv) 1 member appointed by the Sec2 retary. 

3 (D) COMPENSATION.—Members of an Ad4 visory Board may receive reimbursement for 

5 travel expenses and a reasonable stipend. 

6 (4) CONFLICT OF INTEREST.— 

7 (A) PROCEDURES.—Hubs shall establish 

8 procedures to ensure that any employee or con9 sortia designee for Hub activities who serves in 

10 a decisionmaking capacity shall— 

11 (i) disclose any financial interests in, 

12 or financial relationships with, applicants 

13 for or recipients of awards under this sub14 section, including those of his or her 

15 spouse or minor child, unless such relation16 ships or interests would be considered to 

17 be remote or inconsequential; and 

18 (ii) recuse himself or herself from any 

19 funding decision for projects in which he 

20 or she has a personal financial interest. 

21 (B) DISQUALIFICATION AND REVOCA22 TION.—The Secretary may disqualify an appli23 cation or revoke allowances distributed to the 

24 Hub or awards provided under this subsection, 

25 if cognizant officials of the Hub fail to comply 


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1 with procedures required under subparagraph 

2 (A). 

3 (f) DISTRIBUTION OF ALLOWANCES TO ENERGY IN4 NOVATION HUBS.— 

5 (1) DISTRIBUTION OF ALLOWANCES.—Not later 

6 than September 30 of 2011 and each calendar year 

7 thereafter through 2049, the Secretary shall, in ac8 cordance with the requirements of this section, dis9 tribute to eligible consortia allowances allocated for 

10 the following vintage year under section 782(h)(1) of 

11 the Clean Air Act (as added by section 321 of this 

12 Act). Not less than 10 percent and not more than 

13 30 percent of the allowances available for distribu14 tion in any given year shall be distributed to support 

15 any individual Hub under this section. 

16 (2) SELECTION AND SCHEDULE.—Allowances to 

17 support the establishment of a Hub shall be distrib18 uted to eligible consortia (as defined in subsection 

19 (d)) selected through a competitive process. Not 

20 later than 120 days after the date of enactment of 

21 this Act, the Secretary shall solicit proposals from 

22 eligible consortia to establish Hubs, which shall be 

23 submitted not later than 180 days after the date of 

24 enactment of this Act. The Secretary shall select the 

25 program consortia not later than 270 days after the 


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1 date of enactment of this Act. For at least 3 awards 

2 to consortia under this section, the Secretary shall 

3 give special consideration to applications in which 1 

4 or more of the institutions under subsection 

5 (d)(1)(A) are 1890 Land Grant Institutions (as de6 fined in section 2 of the Agricultural Research, Ex7 tension, and Education Reform Act of 1998 (7 

8 U.S.C. 7061)), Predominantly Black Institutions (as 

9 defined in section 318 of the Higher Education Act 

10 of 1965 (20 U.S.C. 1059e)), Tribal Colleges or Uni11 versities (as defined in section 316(b) of the Higher 

12 Education Act of 1965 (20 U.S.C. 1059c(b)), or 

13 Hispanic Serving Institutions (as defined in section 

14 318 of the Higher Education Act of 1965 (20 

15 U.S.C. 1059e)). 

16 (3) AMOUNT AND TERM OF AWARDS.—For each 

17 Hub selected to receive an award under this sub18 section, the Secretary shall define a quantity of al19 lowances that shall be distributed to such Hub each 

20 year for an initial period not to exceed 5 years. The 

21 Secretary may extend the term of such award by up 

22 to 5 additional years, and a Hub may compete to re23 ceive an increase in the quantity of allowances per 

24 year that it shall receive during any such extension. 

25 A Hub shall be eligible to compete for a new award 


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1 after the expiration of the term of any award, in2 cluding any extension of such term, under this sub3 section. 

4 (4) USE OF ALLOWANCES.—Allowances distrib5 uted under this section shall be used exclusively to 

6 support project awards pursuant to subsection (e)(1) 

7 and (2), provided that a Hub may use not more 

8 than 10 percent of the value of such allowances for 

9 its administrative expenses related to making such 

10 awards. Allowances distributed under this section 

11 shall not be used for construction of new buildings 

12 or facilities for Hubs, and construction of new build13 ings or facilities shall not be considered as part of 

14 the non-Federal share of a cost sharing agreement 

15 under this section. 

16 (5) AUDIT.—Each Hub shall conduct, in ac17 cordance with such requirements as the Secretary 

18 may prescribe, an annual audit to determine the ex19 tent to which allowances distributed to the Hub 

20 under this subsection, and awards under subsection 

21 (e), have been utilized in a manner consistent with 

22 this section. The auditor shall transmit a report of 

23 the results of the audit to the Secretary and to the 

24 Government Accountability Office. The Secretary 

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1 gress, along with a plan to remedy any deficiencies 

2 cited in the report. The Government Accountability 

3 Office may review such audits as appropriate and 

4 shall have full access to the books, records, and per5 sonnel of the Hub to ensure that allowances distrib6 uted to the Hub under this subsection, and awards 

7 made under subsection (e), have been utilized in a 

8 manner consistent with this section. 

9 (6) REVOCATION OF ALLOWANCES.—The Sec10 retary shall have authority to review awards made 

11 under this subsection and to revoke such awards if 

12 the Secretary determines that a Hub has used the 

13 award in a manner not consistent with the require14 ments of this section. 

15 SEC. 172. ADVANCED ENERGY RESEARCH. 

16 (a) DEFINITIONS.—For purposes of this section: 

17 (1) ALLOWANCE.—The term ‘‘allowance’’ 

18 means an emission allowance established under sec19 tion 721 of the Clean Air Act (as added by section 

20 311 of this Act). 

21 (2) DIRECTOR.—The term ‘‘Director’’ means 

22 Director of the Advanced Research Projects Agency23 Energy. 

24 (b) IN GENERAL.—Not later than September 30 of 

25 2011 and each calendar year thereafter through 2049, the 


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1 Director shall distribute allowances allocated for the fol2 lowing vintage year under section 782(h)(2) of the Clean 

3 Air Act (as added by section 321 of this Act). Such allow4 ances shall be distributed on a competitive basis to institu5 tions of higher education, companies, research founda6 tions, trade and industry research collaborations, or con7 sortia of such entities, or other appropriate research and 

8 development entities to achieve the goals of the Advanced 

9 Research Projects Agency-Energy (as described in section 

10 5012(c) of the America COMPETES Act) through tar11 geted acceleration of— 

12 (1) novel early-stage energy research with pos13 sible technology applications; 

14 (2) development of techniques, processes, and 

15 technologies, and related testing and evaluation; 

16 (3) development of manufacturing processes for 

17 technologies; and 

18 (4) demonstration and coordination with non19 governmental entities for commercial applications of 

20 technologies and research applications. 

21 (c) RESPONSIBILITIES.—The Director shall be re22 sponsible for assessing the success of programs and termi23 nating programs carried out under this section that are 

24 not achieving the goals of the programs, consistent with 

25 5012(e)(2) and (4) of the America COMPETES Act. The 


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1 Director shall designate program managers whose respon2 sibilities are consistent with 5012(f)(1)(B) of the America 

3 COMPETES Act. The Director’s reporting and coordina4 tion requirements established through 5012(g) and (h) of 

5 the America COMPETES Act shall apply to activities 

6 funded through this section. 

7 (d) SUPPLEMENT NOT SUPPLANT.—Assistance pro8 vided under this section shall be used to supplement, and 

9 not to supplant, any other Federal resources available to 

10 carry out activities described in this section. 

11 SEC. 173. BUILDING ASSESSMENT CENTERS. 

12 (a) IN GENERAL.—The Secretary of Energy (in this 

13 section referred to as the ‘‘Secretary’’) shall provide fund14 ing to institutions of higher education for Building Assess15 ment Centers to— 

16 (1) identify opportunities for optimizing energy 

17 efficiency and environmental performance in existing 

18 buildings; 

19 (2) promote high-efficiency building construc20 tion techniques and materials options; 

21 (3) promote applications of emerging concepts 

22 and technologies in commercial and institutional 

23 buildings; 


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1 (4) train engineers, architects, building sci2 entists, and building technicians in energy-efficient 

3 design and operation; 

4 (5) assist local community colleges, trade 

5 schools, registered apprenticeship programs and 

6 other accredited training programs in training build7 ing technicians; 

8 (6) promote research and development for the 

9 use of alternative energy sources to supply heat and 

10 power, for buildings, particularly energy-intensive 

11 buildings; and 

12 (7) coordinate with and assist State-accredited 

13 technical training centers and community colleges, 

14 while ensuring appropriate services to all regions of 

15 the United States. 

16 (b) COORDINATION WITH REGIONAL CENTERS FOR

17 ENERGY AND ENVIRONMENTAL KNOWLEDGE AND OUT18 REACH.—A Building Assessment Center may serve as a 

19 Center for Energy and Environmental Knowledge and 

20 Outreach established pursuant to section 174. 

21 (c) COORDINATION AND DUPLICATION.—The Sec22 retary shall coordinate efforts under this section with 

23 other programs of the Department of Energy and other 

24 Federal agencies to avoid duplication of effort. 


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1 (d) AUTHORIZATION OF APPROPRIATIONS.—There 

2 are authorized to be appropriated to the Secretary to carry 

3 out this section $50,000,000 for fiscal year 2010 and each 

4 fiscal year thereafter. 

5 SEC. 174. CENTERS FOR ENERGY AND ENVIRONMENTAL 

6 KNOWLEDGE AND OUTREACH. 

7 (a) REGIONAL CENTERS FOR ENERGY AND ENVI8 RONMENTAL KNOWLEDGE AND OUTREACH.— 

9 (1) ESTABLISHMENT.—The Secretary shall es10 tablish not more than 10 regional Centers for En11 ergy and Environmental Knowledge and Outreach at 

12 institutions of higher education to coordinate with 

13 and advise industrial research and assessment cen14 ters, Building Assessment Centers, and Clean En15 ergy Application Centers located in the region of 

16 such Center for Energy and Environmental Knowl17 edge and Outreach. 

18 (2) TECHNICAL ASSISTANCE PROGRAMS.—Each 

19 Center for Energy and Environmental Knowledge 

20 and Outreach shall consist of at least one, new or 

21 existing, high performing, of the following: 

22 (A) An industrial research and assessment 

23 center. 

24 (B) A Clean Energy Application Center. 

25 (C) A Building Assessment Center. 


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1 (3) SELECTION CRITERIA.—The Secretary shall 

2 select Centers for Energy and Environmental 

3 Knowledge and Outreach through a competitive 

4 process, based on the following: 

5 (A) Identification of the highest per6 forming industrial research and assessment cen7 ters, Clean Energy Application Centers, and 

8 Building Assessment Centers. 

9 (B) The degree to which an institution of 

10 higher education maintains credibility among 

11 regional private sector organizations such as 

12 trade associations, engineering associations, and 

13 environmental organizations. 

14 (C) The degree to which an institution of 

15 higher education is providing or has provided 

16 technical assistance, academic leadership, and 

17 market leadership in the energy arena in a 

18 manner that is consistent with the areas of 

19 focus of industrial research and assessment cen20 ters, Clean Energy Application Centers, and 

21 Building Assessment Centers. 

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1 ment Center at the institution of higher edu2 cation. 

3 (4) GEOGRAPHIC DIVERSITY.—In selecting Cen4 ters for Energy and Environmental Knowledge and 

5 Outreach under this subsection, the Secretary shall 

6 ensure such Centers are distributed geographically 

7 in a relatively uniform manner to ensure all regions 

8 of the Nation are represented. 

9 (5) REGIONAL LEADERSHIP.—Each Center for 

10 Energy and Environmental Knowledge and Outreach 

11 shall, to the extent possible, provide leadership to all 

12 other industrial research and assessment centers, 

13 Clean Energy Application Centers, and Building As14 sessment Centers located in the Center’s geographic 

15 region, as determined by the Secretary. Such leader16 ship shall include— 

17 (A) developing regional goals specific to 

18 the purview of the industrial research and as19 sessment centers, Clean Energy Application 

20 Centers, and Building Assessment Centers pro21 grams; 

22 (B) developing regionally specific technical 

23 resources; and 

24 (C) outreach to interested parties in the 

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1 sources, and services available through the asso2 ciated industrial research and assessment cen3 ters, Clean Energy Application Centers, and 

4 Building Assessment Centers. 

5 (6) FURTHER COORDINATION.—To increase the 

6 value and capabilities of the regionally associated in7 dustrial research and assessment centers, Clean En8 ergy Application Centers, and Building Assessment 

9 Centers programs, Centers for Energy and Environ10 mental Knowledge and Outreach shall— 

11 (A) coordinate with Manufacturing Exten12 sion Partnership Centers of the National Insti13 tute of Science and Technology; 

14 (B) coordinate with the relevant programs 

15 in the Department of Energy, including the 

16 Building Technology Program and Industrial 

17 Technologies Program; 

18 (C) increase partnerships with the Na19 tional Laboratories of the Department of En20 ergy to leverage the expertise and technologies 

21 of the National Laboratories to achieve the 

22 goals of the industrial research and assessment 

23 centers, Clean Energy Application Centers, and 

24 Building Assessment Centers; 


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1 (D) work with relevant municipal, county, 

2 and State economic development entities to le3 verage relevant financial incentives for capital 

4 investment and other policy tools for the protec5 tion and growth of local business and industry; 

6 (E) partner with local professional and pri7 vate trade associations and business develop8 ment interests to leverage existing knowledge of 

9 local business challenges and opportunities; 

10 (F) work with energy utilities and other 

11 administrators of publicly funded energy pro12 grams to leverage existing energy efficiency and 

13 clean energy programs; 

14 (G) identify opportunities for reducing 

15 greenhouse gas emissions; and 

16 (H) promote sustainable business practices 

17 for those served by the industrial research and 

18 assessment centers, Clean Energy Application 

19 Centers, and Building Assessment Centers. 

20 (7) WORKFORCE TRAINING.— 

21 (A) IN GENERAL.—The Secretary shall re22 quire each Center for Energy and Environ23 mental Knowledge and Outreach to establish or 

24 maintain an internship program for the region 

25 of such Center, designed to encourage students 


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1 who perform energy assessments to continue 

2 working with a particular company, building, or 

3 facility to help implement the recommendations 

4 contained in any such assessment provided to 

5 such company, building, or facility. Each Center 

6 for Energy and Environmental Knowledge and 

7 Outreach shall act as internship coordinator to 

8 help match students to available opportunities. 

9 (B) FEDERAL SHARE.—The Federal share 

10 of the cost of carrying out internship programs 

11 described under subparagraph (A) shall be 50 

12 percent. 

13 (C) FUNDING.—Subject to the availability 

14 of appropriations, of the funds made available 

15 to carry out this subsection, the Secretary shall 

16 use to carry out this paragraph not less than 

17 $5,000,000 for fiscal year 2010 and each fiscal 

18 year thereafter. 

19 (8) SMALL BUSINESS LOANS.—The Adminis20 trator of the Small Business Administration shall, to 

21 the maximum practicable, expedite consideration of 

22 applications from eligible small business concerns for 

23 loans under the Small Business Act (15 U.S.C. 631 

24 et seq.) for loans to implement recommendations of 

25 any industrial research and assessment center, Clean 


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1 Energy Application Center, or Building Assessment 

2 Center. 

3 (9) DEFINITIONS.—In this subsection: 

4 (A) INDUSTRIAL RESEARCH AND ASSESS5 MENT CENTER.—The term ‘‘industrial research 

6 and assessment center’’ means a center estab7 lished or maintained pursuant to section 452(e) 

8 of the Energy Independence and Security Act 

9 of 2007 (42 U.S.C. 17111(e)). 

10 (B) CLEAN ENERGY APPLICATION CEN11 TER.—The term ‘‘Clean Energy Application 

12 Center’’ means a center redesignated and de13 scribed section under section 375 of the Energy 

14 Policy and Conservation Act (42 U.S.C. 6345). 

15 (C) BUILDING ASSESSMENT CENTER.—The 

16 term ‘‘Building Assessment Center’’ means an 

17 institution of higher education-based center es18 tablished pursuant to section 173. 

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

20 means the Secretary of Energy. 

21 (10) FUNDING.—There are authorized to be ap22 propriated to the Secretary to carry out this sub23 section $10,000,000 for fiscal year 2010 and each 

24 fiscal year thereafter. Subject to the availability of 

25 appropriations, of the funds made available to carry 


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1 out this subsection, the Secretary shall provide to 

2 each Center for Energy and Environmental Knowl3 edge and Outreach not less than $500,000 for fiscal 

4 year 2010 and each fiscal year thereafter. 

5 (b) INTEGRATION OF OTHER TECHNICAL ASSIST6 ANCE PROGRAMS.— 

7 (1) CLEAN ENERGY APPLICATION CENTERS.— 

8 Section 375 of the Energy Policy and Conservation 

9 Act (42 U.S.C. 6345) is amended— 

10 (A) by redesignating subsection (f) as sub11 section (g); and 

12 (B) by adding after subsection (e) the fol13 lowing new subsection: 

14 ‘‘(f) COORDINATION WITH CENTERS FOR ENERGY

15 AND ENVIRONMENTAL KNOWLEDGE AND OUTREACH.—A 

16 Clean Energy Application Center may serve as a Center 

17 for Energy and Environmental Knowledge and Outreach 

18 established pursuant to section 174 of the American Clean 

19 Energy and Security Act of 2009.’’. 

20 (2) INDUSTRIAL RESEARCH AND ASSESSMENT

21 CENTERS.—Section 452(e) of the Energy Independ22 ence and Security Act of 2007 (42 U.S.C. 17111(e)) 

23 is amended— 


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1 (A) by striking ‘‘The Secretary’’ and all 

2 that follows through ‘‘shall be—’’ and inserting 

3 the following: 

4 ‘‘(1) IN GENERAL.—The Secretary shall provide 

5 funding to institution of higher education-based in6 dustrial research and assessment centers, whose pur7 poses shall be—’’; 

8 (B) by redesignating paragraphs (1) 

9 through (5) as subparagraphs (A) through (E), 

10 respectively (and by moving the margins of such 

11 subparagraphs 2 ems to the right); and 

12 (C) by adding at the end the following new 

13 paragraph: 

14 ‘‘(2) COORDINATION WITH CENTERS FOR EN15 ERGY AND ENVIRONMENTAL KNOWLEDGE AND OUT16 REACH.—An industrial research and assessment cen17 ter may serve as a Center for Energy and Environ18 mental Knowledge and Outreach established pursu19 ant to section 174 of the American Clean Energy 

20 and Security Act of 2009.’’. 

21 (c) ADDITIONAL FUNDING FOR CLEAN ENERGY AP22 PLICATION CENTERS.—Subsection (g) of section 375 of 

23 the Energy Policy and Conservation Act (42 U.S.C. 

24 6345(f)), as redesignated by subsection (b)(1) of this sec25 tion, is amended by striking ‘‘$10,000,000 for each of fisVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00242 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 cal years 2008 through 2012’’ and inserting ‘‘$30,000,000 

2 for fiscal year 2010 and each fiscal year thereafter’’. 

3 Subtitle I—Nuclear and Advanced 

4 Technologies 

5 SEC. 181. REVISIONS TO LOAN GUARANTEE PROGRAM AU6 THORITY. 

7 (a) DEFINITION OF CONDITIONAL COMMITMENT.— 

8 Section 1701 of the Energy Policy Act of 2005 (42 U.S.C. 

9 16511), as amended by section 130(a) of this Act, is 

10 amended by adding after paragraph (7) the following: 

11 ‘‘(8) CONDITIONAL COMMITMENT.—The term 

12 ‘conditional commitment’ means a final term sheet 

13 negotiated between the Secretary and a project 

14 sponsor or sponsors, which term sheet shall be bind15 ing on both parties and become a final loan guar16 antee agreement if all conditions precedent estab17 lished in the term sheet, which shall include the ac18 quisition of all necessary permits and licenses, are 

19 satisfied.’’. 

20 (b) SPECIFIC APPROPRIATION OR CONTRIBUTION.— 

21 Section 1702 of the Energy Policy Act of 2005 (42 U.S.C. 

22 16512) is amended by striking subsection (b) and insert23 ing the following: 

24 ‘‘(b) SPECIFIC APPROPRIATION OR CONTRIBU25 TION.— 


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1 ‘‘(1) IN GENERAL.—No guarantee shall be 

2 made unless— 

3 ‘‘(A) an appropriation for the cost has 

4 been made; 

5 ‘‘(B) the Secretary has received from the 

6 borrower a payment in full for the cost of the 

7 obligation and deposited the payment into the 

8 Treasury; or 

9 ‘‘(C) a combination of appropriations or 

10 payments from the borrower has been made 

11 sufficient to cover the cost of the obligation. 

12 ‘‘(2) LIMITATION.—The source of payments re13 ceived from a borrower under paragraph (1)(B) shall 

14 not be a loan or other debt obligation that is made 

15 or guaranteed by the Federal Government.’’. 

16 (c) FEES.—Section 1702(h) of the Energy Policy Act 

17 of 2005 (42 U.S.C. 16512(h)) is amended by striking 

18 paragraph (2) and inserting the following: 

19 ‘‘(2) AVAILABILITY.—Fees collected under this 

20 subsection shall— 

21 ‘‘(A) be deposited by the Secretary into a 

22 special fund in the Treasury to be known as the 

23 ‘Incentives For Innovative Technologies Fund’; 

24 and 


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1 ‘‘(B) remain available to the Secretary for 

2 expenditure, without further appropriation or 

3 fiscal year limitation, for administrative ex4 penses incurred in carrying out this title.’’. 

5 (d) WAGE RATE REQUIREMENTS.—Section 1702 of 

6 the Energy Policy Act of 2005 (42 U.S.C. 16512) is 

7 amended by adding at the end the following new sub8 section: 

9 ‘‘(k) WAGE RATE REQUIREMENTS.—No loan guar10 antee shall be made under this title unless the borrower 

11 has provided to the Secretary reasonable assurances that 

12 all laborers and mechanics employed by contractors and 

13 subcontractors in the performance of construction work fi14 nanced in whole or in part by the guaranteed loan will 

15 be paid wages at rates not less than those prevailing on 

16 projects of a character similar to the contract work in the 

17 civil subdivision of the State in which the contract work 

18 is to be performed as determined by the Secretary of 

19 Labor in accordance with subchapter IV of chapter 31 of 

20 part A of subtitle II of title 40, United States Code. With 

21 respect to the labor standards specified in this subsection, 

22 the Secretary of Labor shall have the authority and func23 tions set forth in Reorganization Plan Numbered 14 of 

24 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 3145 

25 of title 40, United States Code.’’. 


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1 (e) SUBROGATION.—Section 1702(g)(2) of the En2 ergy Policy Act of 2005 (42 U.S.C. 16512(g)(2)) is 

3 amended by striking subparagraphs (B) and (C) and in4 serting the following: 

5 ‘‘(B) SUPERIORITY OF RIGHTS.—Except as 

6 provided in subparagraph (C), the rights of the 

7 Secretary, with respect to any property ac8 quired pursuant to a guarantee or related 

9 agreements, shall be superior to the rights of 

10 any other person with respect to the property. 

11 ‘‘(C) TERMS AND CONDITIONS.—A guar12 antee agreement shall include such detailed 

13 terms and conditions as the Secretary deter14 mines appropriate to— 

15 ‘‘(i) protect the financial interests of 

16 the United States in the case of default; 

17 ‘‘(ii) have available all the patents and 

18 technology necessary for any person se19 lected, including the Secretary, to complete 

20 and operate the project; 

21 ‘‘(iii) provide for sharing the proceeds 

22 received from the sale of project assets 

23 with other creditors or control the disposi24 tion of project assets if necessary to proVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00246 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tect the financial interests of the United 

2 States in the case of default; and 

3 ‘‘(iv) provide such lien priority in 

4 project assets as necessary to protect the 

5 financial interests of the United States in 

6 the case of a default.’’. 

7 SEC. 182. PURPOSE. 

8 The purpose of sections 183 through 189 of this sub9 title is to promote the domestic development and deploy10 ment of clean energy technologies required for the 21st 

11 century through the establishment of a self-sustaining 

12 Clean Energy Deployment Administration that will pro13 vide for an attractive investment environment through 

14 partnership with and support of the private capital market 

15 in order to promote access to affordable financing for ac16 celerated and widespread deployment of— 

17 (1) clean energy technologies; 

18 (2) advanced or enabling energy infrastructure 

19 technologies; 

20 (3) energy efficiency technologies in residential, 

21 commercial, and industrial applications, including 

22 end-use efficiency in buildings; and 

23 (4) manufacturing technologies for any of the 

24 technologies or applications described in this section. 


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1 SEC. 183. DEFINITIONS. 

2 In this subtitle: 

3 (1) ADMINISTRATION.—The term ‘‘Administra4 tion’’ means the Clean Energy Deployment Adminis5 tration established by section 186. 

6 (2) ADVISORY COUNCIL.—The term ‘‘Advisory 

7 Council’’ means the Energy Technology Advisory 

8 Council of the Administration. 

9 (3) BREAKTHROUGH TECHNOLOGY.—The term 

10 ‘‘breakthrough technology’’ means a clean energy 

11 technology that— 

12 (A) presents a significant opportunity to 

13 advance the goals developed under section 185, 

14 as assessed under the methodology established 

15 by the Advisory Council; but 

16 (B) has generally not been considered a 

17 commercially ready technology as a result of 

18 high perceived technology risk or other similar 

19 factors. 

20 (4) CLEAN ENERGY TECHNOLOGY.—The term 

21 ‘‘clean energy technology’’ means a technology re22 lated to the production, use, transmission, storage, 

23 control, or conservation of energy— 

24 (A) that will contribute to a stabilization of 

25 atmospheric greenhouse gas concentrations 


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1 thorough reduction, avoidance, or sequestration 

2 of energy-related emissions and— 

3 (i) reduce the need for additional en4 ergy supplies by using existing energy sup5 plies with greater efficiency or by transmit6 ting, distributing, or transporting energy 

7 with greater effectiveness through the in8 frastructure of the United States; or 

9 (ii) diversify the sources of energy 

10 supply of the United States to strengthen 

11 energy security and to increase supplies 

12 with a favorable balance of environmental 

13 effects if the entire technology system is 

14 considered; and 

15 (B) for which, as determined by the Ad16 ministrator, insufficient commercial lending is 

17 available at affordable rates to allow for wide18 spread deployment. 

19 (5) COST.—The term ‘‘cost’’ has the meaning 

20 given the term in section 502 of the Federal Credit 

21 Reform Act of 1990 (2 U.S.C. 661a). 

22 (6) DIRECT LOAN.—The term ‘‘direct loan’’ has 

23 the meaning given the term in section 502 of the 

24 Federal Credit Reform Act of 1990 (2 U.S.C. 661a). 


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1 (7) FUND.—The term ‘‘Fund’’ means the Clean 

2 Energy Investment Fund established by section 

3 184(a). 

4 (8) GREEN BONDS.—The term ‘‘Green Bonds’’ 

5 means bonds issued pursuant to section 184. 

6 (8) LOAN GUARANTEE.—The term ‘‘loan guar7 antee’’ has the meaning given the term in section 

8 502 of the Federal Credit Reform Act of 1990 (2 

9 U.S.C. 661a). 

10 (9) NATIONAL LABORATORY.—The term ‘‘Na11 tional Laboratory’’ has the meaning given the term 

12 in section 2 of the Energy Policy Act of 2005 (42 

13 U.S.C. 15801). 

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

15 means the Secretary of Energy. 

16 (11) STATE.—The term ‘‘State’’ means— 

17 (A) a State; 

18 (B) the District of Columbia; 

19 (C) the Commonwealth of Puerto Rico; 

20 and 

21 (D) any other territory or possession of the 

22 United States. 

23 (12) TECHNOLOGY RISK.—The term ‘‘tech24 nology risk’’ means the risks during construction or 

25 operation associated with the design, development, 


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1 and deployment of clean energy technologies (includ2 ing the cost, schedule, performance, reliability and 

3 maintenance, and accounting for the perceived risk), 

4 from the perspective of commercial lenders, that 

5 may be increased as a result of the absence of ade6 quate historical construction, operating, or perform7 ance data from commercial applications of the tech8 nology. 

9 SEC. 184. CLEAN ENERGY INVESTMENT FUND. 

10 (a) ESTABLISHMENT.—There is established in the 

11 Treasury of the United States a revolving fund, to be 

12 known as the ‘‘Clean Energy Investment Fund’’, con13 sisting of— 

14 (1) such amounts as are deposited in the Fund 

15 under this subtitle; and 

16 (2) such sums as may be appropriated to sup17 plement the Fund. 

18 (b) AUTHORIZATION OF APPROPRIATIONS.—There 

19 are authorized to be appropriated to the Fund such sums 

20 as are necessary to carry out this subtitle. 

21 (c) EXPENDITURES FROM FUND.— 

22 (1) IN GENERAL.—Amounts in the Fund shall 

23 be available to the Administrator of the Administra24 tion for obligation without fiscal year limitation, to 

25 remain available until expended. 


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1 (2) ADMINISTRATIVE EXPENSES.— 

2 (A) FEES.—Fees collected for administra3 tive expenses shall be available without limita4 tion to cover applicable expenses. 

5 (B) FUND.—To the extent that adminis6 trative expenses are not reimbursed through 

7 fees, an amount not to exceed 1.5 percent of 

8 the amounts in the Fund as of the beginning of 

9 each fiscal year shall be available to pay the ad10 ministrative expenses for the fiscal year nec11 essary to carry out this subtitle. 

12 (d) TRANSFERS OF AMOUNTS.— 

13 (1) IN GENERAL.—The amounts required to be 

14 transferred to the Fund under this section shall be 

15 transferred at least monthly from the general fund 

16 of the Treasury to the Fund on the basis of esti17 mates made by the Secretary of the Treasury. 

18 (2) ADJUSTMENTS.—Proper adjustment shall 

19 be made in amounts subsequently transferred to the 

20 extent prior estimates were in excess of or less than 

21 the amounts required to be transferred. 

22 (3) CASH FLOWS.—Cash flows associated with 

23 costs of the Fund described in section 502(5)(B) of 

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


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1 661a(5)(B)) shall be transferred to appropriate 

2 credit accounts. 

3 (e) GREEN BONDS.— 

4 (1) INITIAL CAPITALIZATION.—The Secretary 

5 of the Treasury shall issue Green Bonds in the 

6 amount of $7,500,000,000 on the credit of the 

7 United States to acquire capital stock of the Admin8 istration. Stock certificates evidencing ownership in 

9 the Administration shall be issued by the Adminis10 tration to the Secretary of the Treasury, to the ex11 tent of payments made for the capital stock of the 

12 Administration. 

13 (2) DENOMINATIONS AND MATURITY.—Green 

14 Bonds shall be in such forms and denominations, 

15 and shall mature within such periods, as determined 

16 by the Secretary of the Treasury. 

17 (3) INTEREST.—Green Bonds shall bear inter18 est at a rate not less than the current average yield 

19 on outstanding market obligations of the United 

20 States of comparable maturity during the month 

21 preceding the issuance of the obligation as deter22 mined by the Secretary of the Treasury. 

23 (4) LAWFUL INVESTMENTS.—Green Bonds 

24 shall be lawful investments, and may be accepted as 

25 security for all fiduciary, trust, and public funds, the 


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1 investment or deposit of which shall be under the 

2 authority or control of the United States or any offi3 cer or officers thereof. 

4 SEC. 185. ENERGY TECHNOLOGY DEPLOYMENT GOALS. 

5 (a) GOALS.—Not later than 1 year after the date of 

6 enactment of this Act, the Secretary, after consultation 

7 with the Advisory Council, shall develop and publish for 

8 review and comment in the Federal Register recommended 

9 near-, medium-, and long-term goals (including numerical 

10 performance targets at appropriate intervals to measure 

11 progress toward those goals) for the deployment of clean 

12 energy technologies through the credit support programs 

13 established by section 187 to promote— 

14 (1) sufficient electric generating capacity using 

15 clean energy technologies to meet the energy needs 

16 of the United States; 

17 (2) clean energy technologies in vehicles and 

18 fuels that will substantially reduce the reliance of 

19 the United States on foreign sources of energy and 

20 insulate consumers from the volatility of world en21 ergy markets; 

22 (3) a domestic commercialization and manufac23 turing capacity that will establish the United States 

24 as a world leader in clean energy technologies across 

25 multiple sectors; 


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1 (4) installation of sufficient infrastructure to 

2 allow for the cost-effective deployment of clean en3 ergy technologies appropriate to each region of the 

4 United States; 

5 (5) the transformation of the building stock of 

6 the United States to zero net energy consumption; 

7 (6) the recovery, use, and prevention of waste 

8 energy; 

9 (7) domestic manufacturing of clean energy 

10 technologies on a scale that is sufficient to achieve 

11 price parity with conventional energy sources; 

12 (8) domestic production of commodities and 

13 materials (such as steel, chemicals, polymers, and 

14 cement) using clean energy technologies so that the 

15 United States will become a world leader in environ16 mentally sustainable production of the commodities 

17 and materials; 

18 (9) a robust, efficient, and interactive electricity 

19 transmission grid that will allow for the incorpora20 tion of clean energy technologies, distributed genera21 tion, and demand-response in each regional electric 

22 grid; 

23 (10) sufficient availability of financial products 

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1 ficiency and distributed generation technology in2 vestments with reasonable payback periods; and 

3 (11) such other goals as the Secretary, in con4 sultation with the Advisory Council, determines to be 

5 consistent with the purpose stated in section 182. 

6 (b) REVISIONS.—The Secretary shall revise the goals 

7 established under subsection (a), from time to time as ap8 propriate, to account for advances in technology and 

9 changes in energy policy. 

10 SEC. 186. CLEAN ENERGY DEPLOYMENT ADMINISTRATION. 

11 (a) ESTABLISHMENT.— 

12 (1) ESTABLISHMENT OF CORPORATION.—There 

13 is established a corporation to be known as the 

14 Clean Energy Deployment Administration that shall 

15 be wholly owned by the United States. 

16 (2) INDEPENDENT CORPORATION.—The Admin17 istration shall be an independent corporation. Nei18 ther the Administration nor any of its functions, 

19 powers, or duties shall be transferred to or consoli20 dated with any other department, agency, or cor21 poration of the Government unless the Congress pro22 vides otherwise. 

23 (3) CHARTER.—The Administration shall be 

24 chartered for 20 years from the date of enactment 

25 of this section. 


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1 (4) STATUS.— 

2 (A) INSPECTOR GENERAL.—Section 12 of 

3 the Inspector General Act of 1978 (5 U.S.C. 

4 App.) is amended— 

5 (i) in paragraph (1), by inserting ‘‘the 

6 Administrator of the Clean Energy Deploy7 ment Administration;’’ after ‘‘Export-Im8 port Bank;’’; and 

9 (ii) in paragraph (2), by inserting 

10 ‘‘the Clean Energy Deployment Adminis11 tration,’’ after ‘‘Export-Import Bank,’’. 

12 (3) OFFICES.— 

13 (A) PRINCIPAL OFFICE.—The Administra14 tion shall— 

15 (i) maintain the principal office of the 

16 Administration in the national capital re17 gion; and 

18 (ii) for purposes of venue in civil ac19 tions, be considered to be a resident of the 

20 District of Columbia. 

21 (B) OTHER OFFICES.—The Administration 

22 may establish other offices in such other places 

23 as the Administration considers necessary or 

24 appropriate for the conduct of the business of 

25 the Administration. 


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1 (b) ADMINISTRATOR.— 

2 (1) IN GENERAL.—The Administrator of the 

3 Administration shall be— 

4 (A) appointed by the President, with the 

5 advice and consent of the Senate, for a 5-year 

6 term; and 

7 (B) compensated at the prevailing rate for 

8 compensation for similar positions in industry. 

9 (2) DUTIES.—The Administrator of the Admin10 istration shall— 

11 (A) serve as the Chief Executive Officer of 

12 the Administration and Chairman of the Board; 

13 (B) ensure that— 

14 (i) the Administration operates in a 

15 safe and sound manner, including mainte16 nance of adequate capital and internal con17 trols (consistent with section 404 of the 

18 Sarbanes-Oxley Act of 2002 (15 U.S.C. 

19 7262)); 

20 (ii) the operations and activities of the 

21 Administration foster liquid, efficient, com22 petitive, and resilient energy and energy ef23 ficiency finance markets; 

24 (iii) the Administration carries out the 

25 purpose stated in section 182 only through 


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1 activities that are authorized under and 

2 consistent with sections 182 through 189; 

3 and 

4 (iv) the activities of the Administra5 tion and the manner in which the Adminis6 tration is operated are consistent with the 

7 public interest; 

8 (C) develop policies and procedures for the 

9 Administration that will— 

10 (i) promote a self-sustaining portfolio 

11 of investments that will maximize the value 

12 of investments to effectively promote clean 

13 energy technologies; 

14 (ii) promote transparency and open15 ness in Administration operations; 

16 (iii) afford the Administration with 

17 sufficient flexibility to meet the purpose 

18 stated in section 182; and 

19 (iv) provide for the efficient proc20 essing of applications; and 

21 (D) with the concurrence of the Board, set 

22 expected loss reserves for the support provided 

23 by the Administration consistent with section 

24 187(c). 

25 (c) BOARD OF DIRECTORS.— 


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1 (1) IN GENERAL.—The Board of Directors of 

2 the Administration shall consist of— 

3 (A) the Secretary or the designee of the 

4 Secretary, who shall serve as an ex-officio mem5 ber of the Board of Directors; 

6 (B) the Secretary of the Treasury or the 

7 designee of the Secretary, who shall serve as an 

8 ex-officio member of the Board of Directors; 

9 (C) the Secretary of the Interior or the 

10 designee of the Secretary, who shall serve as an 

11 ex-officio member of the Board of Directors; 

12 (D) the Secretary of Agriculture or the 

13 designee of the Secretary, who shall serve as an 

14 ex officio member of the Board of Directors; 

15 (E) the Administrator of the Administra16 tion, who shall serve as the Chairman of the 

17 Board of Directors; and 

18 (F) 4 additional members who shall— 

19 (i) be appointed by the President, 

20 with the advice and consent of the Senate, 

21 for staggered 5-year terms; and 

22 (ii) have experience in banking, finan23 cial services, technology assessment, energy 

24 regulation, or risk management, including 

25 individuals with substantial experience in 


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1 the development of energy projects, the 

2 electricity generation sector, the transpor3 tation sector, the manufacturing sector, 

4 and the energy efficiency sector. 

5 (2) DUTIES.—The Board of Directors shall— 

6 (A) oversee the operations of the Adminis7 tration and ensure industry best practices are 

8 followed in all financial transactions involving 

9 the Administration; 

10 (B) consult with the Administrator of the 

11 Administration on the general policies and pro12 cedures of the Administration to ensure the in13 terests of the taxpayers are protected; 

14 (C) ensure the portfolio of investments are 

15 consistent with purpose stated in section 182 

16 and with the long-term financial stability of the 

17 Administration; 

18 (D) ensure that the operations and activi19 ties of the Administration are consistent with 

20 the development of a robust private sector that 

21 can provide commercial loans or financing prod22 ucts; and 

23 (E) not serve on a full-time basis, except 

24 that the Board of Directors shall meet at least 

25 quarterly to review, as appropriate, applications 


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1 for credit support and set policies and proce2 dures as necessary. 

3 (3) REMOVAL.—An appointed member of the 

4 Board of Directors may be removed from office by 

5 the President for good cause. 

6 (4) VACANCIES.—An appointed seat on the 

7 Board of Directors that becomes vacant shall be 

8 filled by appointment by the President, but only for 

9 the unexpired portion of the term of the vacating 

10 member. 

11 (5) COMPENSATION OF MEMBERS.—An ap12 pointed member of the Board of Directors shall be 

13 compensated at the prevailing rate for compensation 

14 for similar positions in industry. 

15 (d) ENERGY TECHNOLOGY ADVISORY COUNCIL.— 

16 (1) IN GENERAL.—The Administration shall 

17 have an Energy Technology Advisory Council con18 sisting of 8 members selected by the Board of Direc19 tors of the Administration. 

20 (2) QUALIFICATIONS.—The members of the Ad21 visory Council shall— 

22 (A) have clean energy project development, 

23 clean energy finance, commercial, and/or rel24 evant scientific expertise; and 

25 (B) include representatives of— 


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1 (i) the academic community; 

2 (ii) the private research community; 

3 (iii) National Laboratories; 

4 (iv) the technology or project develop5 ment community; and 

6 (v) the commercial energy financing 

7 and operations sector. 

8 (3) DUTIES.—The Advisory Council shall— 

9 (A) develop and publish for comment in 

10 the Federal Register a methodology for assess11 ment of clean energy technologies that will 

12 allow the Administration to evaluate projects 

13 based on the progress likely to be achieved per14 dollar invested in maximizing the attributes of 

15 the definition of clean energy technology, taking 

16 into account the extent to which support for a 

17 clean energy technology is likely to accrue sub18 sequent benefits that are attributable to a com19 mercial scale deployment taking place earlier 

20 than that which otherwise would have occurred 

21 without the support; and 

22 (B) advise on the technological approaches 

23 that should be supported by the Administration 

24 to meet the technology deployment goals estab25 lished by the Secretary pursuant to section 185. 


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1 (4) TERM.— 

2 (A) IN GENERAL.—Members of the Advi3 sory Council shall have 5-year staggered terms, 

4 as determined by the Administrator of the Ad5 ministration. 

6 (B) REAPPOINTMENT.—A member of the 

7 Advisory Council may be reappointed. 

8 (5) COMPENSATION.—A member of the Advi9 sory Council, who is not otherwise compensated as 

10 a Federal employee, shall be compensated at a rate 

11 equal to the daily equivalent of the annual rate of 

12 basic pay prescribed for level IV of the Executive 

13 Schedule under section 5315 of title 5, United 

14 States Code, for each day (including travel time) 

15 during which the member is engaged in the perform16 ance of the duties of the Advisory Council. 

17 (e) STAFF.— 

18 (1) IN GENERAL.—The Administrator of the 

19 Administration, in consultation with the Board of 

20 Directors, may— 

21 (A) appoint and terminate such officers, 

22 attorneys, employees, and agents as are nec23 essary to carry out this subtitle; and 


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1 (B) vest those personnel with such powers 

2 and duties as the Administrator of the Adminis3 tration may determine. 

4 (f) CONFLICTS OF INTEREST.—No director, officer, 

5 attorney, agent, or employee of the Administration shall 

6 in any manner, directly or indirectly, participate in the 

7 deliberation upon, or the determination of, any question 

8 affecting such individual’s personal interests, or the inter9 ests of any corporation, partnership, or association in 

10 which such individual is directly or indirectly personally 

11 interested. 

12 (g) SUNSET.— 

13 (1) EXPIRATION OF CHARTER.—The Adminis14 tration shall continue to exercise its functions until 

15 all obligations and commitments of the Administra16 tion are discharged, even after its charter has ex17 pired. 

18 (2) PRIOR OBLIGATIONS.—No provisions of this 

19 subsection shall be construed as preventing the Ad20 ministration from— 

21 (A) undertaking obligations prior to the 

22 date of the expiration of its charter which ma23 ture subsequent to such date; 

24 (B) assuming, prior to the date of the ex25 piration of its charter, liability as guarantor, 


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1 endorser, or acceptor of obligations which ma2 ture subsequent to such date; or 

3 (C) continuing as a corporation and exer4 cising any of its functions subsequent to the 

5 date of the expiration of its charter for pur6 poses of orderly liquidation, including the ad7 ministration of its assets and the collection of 

8 any obligations held by the Administration. 

9 SEC. 187. DIRECT SUPPORT. 

10 (a) IN GENERAL.—The Administration may issue di11 rect loans, letters of credit, and loan guarantees to deploy 

12 clean energy technologies if the Administrator of the Ad13 ministration has determined that deployment of the tech14 nologies would benefit or be accelerated by the support. 

15 (b) ELIGIBILITY CRITERIA.—In carrying out this sec16 tion and awarding credit support to projects, the Adminis17 trator of the Administration shall account for— 

18 (1) how the technology rates based on an eval19 uation methodology established by the Advisory 

20 Council; 

21 (2) how the project fits with the goals estab22 lished under section 185; and 

23 (3) the potential for the applicant to success24 fully complete the project. 

25 (c) RISK.— 


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1 (1) EXPECTED LOAN LOSS RESERVE.—The Ad2 ministrator of the Administration shall establish an 

3 expected loan loss reserve to account for estimated 

4 losses attributable to activities under this section 

5 that is consistent with the purposes of— 

6 (A) developing breakthrough technologies 

7 to the point at which technology risk is largely 

8 mitigated; 

9 (B) achieving widespread deployment and 

10 advancing the commercial viability of clean en11 ergy technologies; and 

12 (C) advancing the goals established under 

13 section 185. 

14 (2) INITIAL EXPECTED LOAN LOSS RESERVE.— 

15 Until such time as the Administrator of the Admin16 istration determines sufficient data exist to establish 

17 an expected loan loss reserve that is appropriate, the 

18 Administrator of the Administration shall consider 

19 establishing an initial rate of 10 percent for the 

20 portfolio of investments under this subtitle. 

21 (3) PORTFOLIO INVESTMENT APPROACH.—The 

22 Administration shall— 

23 (A) use a portfolio investment approach to 

24 mitigate risk and diversify investments across 

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1 nology is provided more than 30 percent of the 

2 financial support available; 

3 (B) to the maximum extent practicable and 

4 consistent with long-term self-sufficiency, weigh 

5 the portfolio of investments in projects to ad6 vance the goals established under section 185; 

7 (C) consistent with the expected loan loss 

8 reserve established under this subsection, the 

9 purpose stated in section 182, and section 

10 186(b)(2)(B), provide the maximum practicable 

11 percentage of support to promote breakthrough 

12 technologies; and 

13 (D) give the highest priority to investments 

14 that promote technologies that will achieve the 

15 maximum greenhouse gas emission reductions 

16 within a reasonable period of time per dollar in17 vested and the earliest reductions in greenhouse 

18 gas emissions. 

19 (4) LOSS RATE REVIEW.— 

20 (A) IN GENERAL.—The Board of Directors 

21 shall review on an annual basis the loss rates 

22 of the portfolio to determine the adequacy of 

23 the reserves. 

24 (B) REPORT.—Not later than 90 days 

25 after the date of the initiation of the review, the 


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1 Administrator of the Administration shall sub2 mit to the Committee on Energy and Natural 

3 Resources and the Committee on Finance of the 

4 Senate, and the Committee on Energy and 

5 Commerce and the Committee on Ways and 

6 Means of the House of Representatives a report 

7 describing the results of the review and any rec8 ommended policy changes. 

9 (5) FEDERAL COST SHARE.—Direct loans, let10 ters of credit and loan guarantees by the Adminis11 tration shall not exceed an amount equal to 80 per12 cent of the project cost of the facility that is the 

13 subject of the loan, letter of credit or loan guar14 antee, as estimated at the time at which the loan, 

15 letter of credit or loan guarantee is issued. 

16 (d) APPLICATION REVIEW.— 

17 (1) IN GENERAL.—To the maximum extent 

18 practicable and consistent with sound business prac19 tices, the Administration shall seek to consolidate re20 views of applications for credit support under this 

21 subtitle such that final decisions on applications can 

22 generally be issued not later than 180 days after the 

23 date of submission of a completed application. 


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1 (2) ENVIRONMENTAL REVIEW.—In carrying out 

2 this subtitle, the Administration shall, to the max3 imum extent practicable— 

4 (A) avoid duplicating efforts that have al5 ready been undertaken by other agencies (in6 cluding State agencies acting under Federal 

7 programs); and 

8 (B) with the advice of the Council on Envi9 ronmental Quality and any other applicable 

10 agencies, use the administrative records of simi11 lar reviews conducted throughout the executive 

12 branch to develop the most expeditious review 

13 process practicable. 

14 (e) WAGE RATE REQUIREMENTS.— 

15 (1) IN GENERAL.—No credit support shall be 

16 issued under this section unless the borrower has 

17 provided to the Administrator of the Administration 

18 reasonable assurances that all laborers and mechan19 ics employed by contractors and subcontractors in 

20 the performance of construction work financed in 

21 whole or in part by the Administration will be paid 

22 wages at rates not less than those prevailing on 

23 projects of a character similar to the contract work 

24 in the civil subdivision of the State in which the con25 tract work is to be performed as determined by the 


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1 Secretary of Labor in accordance with subchapter 

2 IV of chapter 31 of part A of subtitle II of title 40, 

3 United States Code. 

4 (2) LABOR STANDARDS.—With respect to the 

5 labor standards specified in this subsection, the Sec6 retary of Labor shall have the authority and func7 tions set forth in Reorganization Plan Numbered 14 

8 of 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 

9 3145 of title 40, United States Code. 

10 (f) LIMITATIONS.—(1) The Administration shall not 

11 provide direct support as defined under this section or in12 direct support as defined under section 188 to an indi13 vidual clean energy technology project that obtained a loan 

14 guarantee under title XVII of the Energy Policy Act of 

15 2005. 

16 (2) No direct or indirect support provided by the Ad17 ministration may be used to pay any part of the cost of 

18 an obligation or a loan guarantee under Title XVII of the 

19 Energy Policy Act of 2005. 

20 SEC. 188. INDIRECT SUPPORT. 

21 (a) IN GENERAL.—For the purpose of enhancing the 

22 availability of private financing for clean energy tech23 nology deployment, the Administration may— 

24 (1) provide credit support to portfolios of tax25 able debt obligations originated by state, local, and 


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1 private sector entities that enable owners and users 

2 of buildings and industrial facilities to— 

3 (A) significantly increase the energy effi4 ciency of such buildings or facilities; or 

5 (B) install systems that individually gen6 erate electricity from renewable energy re7 sources and have a capacity of no more than 2 

8 megawatts; 

9 (2) facilitate financing transactions in tax eq10 uity markets and long-term purchasing of clean en11 ergy by state, local, and non-governmental not-for12 profit entities, to the degree and extent that the Ad13 ministration determines such financing activity is 

14 appropriate and consistent with carrying out the 

15 purposes described in Section 182 of this Act; and 

16 (3) provide credit support to portfolios of tax17 able debt obligations originated by state, local, and 

18 private sector entities that enable the deployment of 

19 energy storage applications for electric drive vehi20 cles, stationary applications, and electricity trans21 mission and distribution. 

22 (b) DEFINITIONS.—For purposes of the section: 

23 (1) CREDIT SUPPORT.—The term ‘‘credit sup24 port’’ means— 


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1 (A) direct loans, letters of credit, loan 

2 guarantees, and insurance products; and 

3 (B) the purchase or commitment to pur4 chase, or the sale or commitment to sell, debt 

5 instruments (including subordinated securities). 

6 (2) RENEWABLE ENERGY RESOURCE.—The 

7 term ‘‘renewable energy resource’’ shall have the 

8 meaning given that term in section 610 of the Public 

9 Utility Regulatory Policies Act of 1978 (as added by 

10 section 101 of this Act). 

11 (c) TRANSPARENCY.—The Administration shall seek 

12 to foster through its credit support activities— 

13 (1) the development and consistent application 

14 of standard contractual terms, transparent under15 writing standards and consistent measurement and 

16 verification protocols, as applicable; and 

17 (2) the creation of performance data that pro18 motes effective underwriting and risk management 

19 to support lending markets and stimulate the devel20 opment of private investment markets. 

21 (d) EXEMPT SECURITIES.—All securities insured or 

22 guaranteed by the Administration shall, to the same ex23 tent as securities that are direct obligations of or obliga24 tions guaranteed as to the principal or interest by the 

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1 in the meaning of the laws administered by the Securities 

2 and Exchange Commission. 

3 SEC. 189. FEDERAL CREDIT AUTHORITY. 

4 (a) PAYMENTS OF LIABILITIES.— 

5 (1) IN GENERAL.—Any payment made to dis6 charge liabilities arising from agreements under this 

7 subtitle shall be paid exclusively out of the Fund or 

8 the associated credit account, as appropriate. 

9 (2) SECURITY.—Subject to paragraph (1), the 

10 full faith and credit of the United States is pledged 

11 to the payment of all obligations entered into by the 

12 Administration pursuant to this subtitle. 

13 (b) FEES.— 

14 (1) IN GENERAL.—Consistent with achieving 

15 the purpose stated in section 182, the Administrator 

16 of the Administration shall charge fees or collect 

17 compensation generally in accordance with commer18 cial rates. 

19 (2) AVAILABILITY OF FEES.—All fees collected 

20 by the Administration may be retained by the Ad21 ministration and placed in the Fund and may re22 main available to the Administration, without fur23 ther appropriation or fiscal year limitation, for use 

24 in carrying out the purpose stated in section 182. 


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1 (3) BREAKTHROUGH TECHNOLOGIES.—The Ad2 ministration shall charge the minimum amount in 

3 fees or compensation practicable for breakthrough 

4 technologies, consistent with the long-term viability 

5 of the Administration, unless the Administration 

6 first determines that a higher charge will not impede 

7 the development of the technology. 

8 (4) ALTERNATIVE FEE ARRANGEMENTS.—The 

9 Administration may use such alternative arrange10 ments (such as profit participation, contingent fees, 

11 and other valuable contingent interests) as the Ad12 ministration considers appropriate to compensate the 

13 Administration for the expenses of the Administra14 tion and the risk inherent in the support of the Ad15 ministration. 

16 (c) COST TRANSFER AUTHORITY.—Amounts col17 lected by the Administration for the cost of a loan or loan 

18 guarantee shall be transferred by the Administration to 

19 the respective credit accounts. 

20 SEC. 190. GENERAL PROVISIONS. 

21 (a) IMMUNITY FROM IMPAIRMENT, LIMITATION, OR

22 RESTRICTION.— 

23 (1) IN GENERAL.—All rights and remedies of 

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1 spect to any mortgage or any obligation secured by 

2 a mortgage) shall be immune from impairment, limi3 tation, or restriction by or under— 

4 (A) any law (other than a law enacted by 

5 Congress expressly in limitation of this para6 graph) that becomes effective after the acquisi7 tion by the Administration of the subject or 

8 property on, under, or with respect to which the 

9 right or remedy arises or exists or would so 

10 arise or exist in the absence of the law; or 

11 (B) any administrative or other action that 

12 becomes effective after the acquisition. 

13 (2) STATE LAW.—The Administrator of the Ad14 ministration may conduct the business of the Ad15 ministration without regard to any qualification or 

16 law of any State relating to incorporation. 

17 (b) USE OF OTHER AGENCIES.—With the consent of 

18 a department, establishment, or instrumentality (including 

19 any field office), the Administration may— 

20 (1) use and act through any department, estab21 lishment, or instrumentality; and 

22 (2) use, and pay compensation for, information, 

23 services, facilities, and personnel of the department, 

24 establishment, or instrumentality. 

25 (c) FINANCIAL MATTERS.— 


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1 (1) INVESTMENTS.—Funds of the Administra2 tion may be invested in such investments as the 

3 Board of Directors may prescribe. Earnings from 

4 such funds, other than fees collected under section 

5 189, may be spent by the Administration only to 

6 such extent or in such amounts as are provided in 

7 advance by appropriation Acts. 

8 (2) FISCAL AGENTS.—Any Federal Reserve 

9 bank or any bank as to which at the time of the des10 ignation of the bank by the Administrator of the Ad11 ministration there is outstanding a designation by 

12 the Secretary of the Treasury as a general or other 

13 depository of public money, may be designated by 

14 the Administrator of the Administration as a deposi15 tary or custodian or as a fiscal or other agent of the 

16 Administration. 

17 (d) PERIODIC REPORTS.—Not later than 1 year after 

18 commencement of operation of the Administration and at 

19 least biannually thereafter, the Administrator of the Ad20 ministration shall submit to the Committee on Energy and 

21 Natural Resources and the Committee on Finance of the 

22 Senate and the Committee on Energy and Commerce and 

23 the Committee on Ways and Means of the House of Rep24 resentatives a report that includes a description of— 


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1 (1) the technologies supported by activities of 

2 the Administration and how the activities advance 

3 the purpose stated in section 182; and 

4 (2) the performance of the Administration on 

5 meeting the goals established under section 185. 

6 (g) AUDITS BY THE COMPTROLLER GENERAL.— 

7 (1) IN GENERAL.—The programs, activities, re8 ceipts, expenditures, and financial transactions of 

9 the Administration shall be subject to audit by the 

10 Comptroller General of the United States under 

11 such rules and regulations as may be prescribed by 

12 the Comptroller General. 

13 (2) ACCESS.—The representatives of the Gov14 ernment Accountability Office shall— 

15 (A) have access to the personnel and to all 

16 books, accounts, documents, records (including 

17 electronic records), reports, files, and all other 

18 papers, automated data, things, or property be19 longing to, under the control of, or in use by 

20 the Administration, or any agent, representa21 tive, attorney, advisor, or consultant retained by 

22 the Administration, and necessary to facilitate 

23 the audit; 


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1 (B) be afforded full facilities for verifying 

2 transactions with the balances or securities held 

3 by depositories, fiscal agents, and custodians; 

4 (C) be authorized to obtain and duplicate 

5 any such books, accounts, documents, records, 

6 working papers, automated data and files, or 

7 other information relevant to the audit without 

8 cost to the Comptroller General; and 

9 (D) have the right of access of the Comp10 troller General to such information pursuant to 

11 section 716(c) of title 31, United States Code. 

12 (3) ASSISTANCE AND COST.— 

13 (A) IN GENERAL.—For the purpose of con14 ducting an audit under this subsection, the 

15 Comptroller General may, in the discretion of 

16 the Comptroller General, employ by contract, 

17 without regard to section 3709 of the Revised 

18 Statutes (41 U.S.C. 5), professional services of 

19 firms and organizations of certified public ac20 countants for temporary periods or for special 

21 purposes. 

22 (B) REIMBURSEMENT.— 

23 (i) IN GENERAL.—On the request of 

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1 countability Office for the full cost of any 

2 audit conducted by the Comptroller Gen3 eral under this subsection. 

4 (ii) CREDITING.—Such reimburse5 ments shall— 

6 (I) be credited to the appropria7 tion account entitled ‘‘Salaries and 

8 Expenses, Government Accountability 

9 Office’’ at the time at which the pay10 ment is received; and 

11 (II) remain available until ex12 pended. 

13 (h) ANNUAL INDEPENDENT AUDITS.— 

14 (1) IN GENERAL.—The Administrator of the 

15 Administration shall— 

16 (A) have an annual independent audit 

17 made of the financial statements of the Admin18 istration by an independent public accountant 

19 in accordance with generally accepted auditing 

20 standards; and 

21 (B) submit to the Secretary and to the 

22 Committee on Energy and Natural Resources 

23 and the Committee on Finance of the Senate 

24 and the Committee on Energy and Commerce 


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1 and the Committee on Ways and Means of the 

2 House the results of the audit. 

3 (2) CONTENT.—In conducting an audit under 

4 this subsection, the independent public accountant 

5 shall determine and report on whether the financial 

6 statements of the Administration— 

7 (A) are presented fairly in accordance with 

8 generally accepted accounting principles; and 

9 (B) comply with any disclosure require10 ments imposed under this subtitle. 

11 (i) FINANCIAL REPORTS.— 

12 (1) IN GENERAL.—The Administrator of the 

13 Administration shall submit to the Secretary and to 

14 the Committee on Energy and Natural Resources 

15 and the Committee on Finance of the Senate and 

16 the Committee on Energy and Commerce and the 

17 Committee on Ways and Means of the House annual 

18 and quarterly reports of the financial condition and 

19 operations of the Administration, which shall be in 

20 such form, contain such information, and be sub21 mitted on such dates as the Secretary shall require. 

22 (2) CONTENTS OF ANNUAL REPORTS.—Each 

23 annual report shall include— 


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1 (A) financial statements prepared in ac2 cordance with generally accepted accounting 

3 principles; 

4 (B) any supplemental information or alter5 native presentation that the Secretary may re6 quire; and 

7 (C) an assessment (as of the end of the 

8 most recent fiscal year of the Administration), 

9 signed by the chief executive officer and chief 

10 accounting or financial officer of the Adminis11 tration, of— 

12 (i) the effectiveness of the internal 

13 control structure and procedures of the 

14 Administration; and 

15 (ii) the compliance of the Administra16 tion with applicable safety and soundness 

17 laws. 

18 (3) SPECIAL REPORTS.—The Secretary may re19 quire the Administrator of the Administration to 

20 submit other reports on the condition (including fi21 nancial condition), management, activities, or oper22 ations of the Administration, as the Secretary con23 siders appropriate. 

24 (4) ACCURACY.—Each report of financial condi25 tion shall contain a declaration by the Administrator 


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1 of the Administration or any other officer designated 

2 by the Board of Directors of the Administration to 

3 make the declaration, that the report is true and 

4 correct to the best of the knowledge and belief of the 

5 officer. 

6 (5) AVAILABILITY OF REPORTS.—Reports re7 quired under this section shall be published and 

8 made publicly available as soon as is practicable 

9 after receipt by the Secretary. 

10 (j) SPENDING SAFEGUARDS AND REPORTING.— 

11 (1) IN GENERAL.—The Administrator— 

12 (A) shall require any entity receiving fi13 nancing support from the Administration to re14 port quarterly, in a format specified by the Ad15 ministrator, on such entity’s use of such sup16 port and its progress fulfilling the objectives for 

17 which such support was granted, and the Ad18 ministrator shall make these reports available 

19 to the public; 

20 (B) may establish additional reporting and 

21 information requirements for any recipient of fi22 nancing support from the Administration; 

23 (C) shall establish appropriate mechanisms 

24 to ensure appropriate use and compliance with 


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1 all terms of any financing support from the Ad2 ministration; 

3 (D) shall create and maintain a fully 

4 searchable database, accessible on the Internet 

5 (or successor protocol) at no cost to the public, 

6 that contains at least— 

7 (i) a list of each entity that has ap8 plied for financing support; 

9 (ii) a description of each application; 

10 (iii) the status of each such applica11 tion; 

12 (iv) the name of each entity receiving 

13 financing support; 

14 (v) the purpose for which such entity 

15 is receiving such financing support; 

16 (vi) each quarterly report submitted 

17 by the entity pursuant to this section; and 

18 (vii) such other information sufficient 

19 to allow the public to understand and mon20 itor the financial support provided by the 

21 Administration; 

22 (E) shall make all financing transactions 

23 available for public inspection, including formal 

24 annual reviews by both a private auditor and 

25 the Comptroller General; and 


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1 (F) shall at all times be available to receive 

2 public comment in writing on the activities of 

3 the Administration. 

4 (2) PROTECTION OF CONFIDENTIAL BUSINESS

5 INFORMATION.—To the extent necessary and appro6 priate, the Administrator may redact any informa7 tion regarding applicants and borrowers to protect 

8 confidential business information. 

9 SEC. 191. CONFORMING AMENDMENTS. 

10 (a) TAX EXEMPT STATUS.—Subsection (l) of section 

11 501 of the Internal Revenue Code of 1986 is amended by 

12 adding at the end the following: 

13 ‘‘(4) The Clean Energy Deployment Adminis14 tration established under section 9801 of title 31, 

15 United States Code.’’. 

16 (b) WHOLLY OWNED GOVERNMENT CORPORA17 TION.—Paragraph (3) of section 9101 of title 31, United 

18 States Code, is amended by adding at the end the fol19 lowing: 

20 ‘‘(S) the Clean Energy Deployment Admin21 istration.’’. 


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1 Subtitle J—Miscellaneous 

2 SEC. 195. INCREASED HYDROELECTRIC GENERATION AT 

3 EXISTING FEDERAL FACILITIES. 

4 (a) IN GENERAL.—The Secretary of the Interior, the 

5 Secretary of Energy, and the Secretary of the Army shall 

6 jointly update the study of the potential for increasing 

7 electric power production capability at federally owned or 

8 operated water regulation, storage, and conveyance facili9 ties required in section 1834 of the Energy Policy Act of 

10 2005. 

11 (b) CONTENT.—The update under this section shall 

12 include identification and description in detail of each fa13 cility that is capable, with or without modification, of pro14 ducing additional hydroelectric power, including esti15 mation of the existing potential for the facility to generate 

16 hydroelectric power. 

17 (c) REPORT.—The Secretaries shall submit to the 

18 Committees on Energy and Commerce, Natural Re19 sources, and Transportation and Infrastructure of the 

20 House of Representatives and the Committee on Energy 

21 and Natural Resources of the Senate a report on the find22 ings, conclusions, and recommendations of the update of 

23 the study under this section by not later than 12 months 

24 after the date of enactment of this Act. The report shall 

25 include each of the following: 


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1 (1) The identifications, descriptions, and esti2 mations referred to in subsection (b). 

3 (2) A description of activities currently con4 ducted or considered, or that could be considered, to 

5 produce additional hydroelectric power from each 

6 identified facility. 

7 (3) A summary of prior actions taken by the 

8 Secretaries to produce additional hydroelectric power 

9 from each identified facility. 

10 (4) The costs to install, upgrade, or modify 

11 equipment or take other actions to produce addi12 tional hydroelectric power from each identified facil13 ity, and the level of Federal power customer involve14 ment in the determination of such costs. 

15 (5) The benefits that would be achieved by such 

16 installation, upgrade, modification, or other action, 

17 including quantified estimates of any additional en18 ergy or capacity from each facility identified under 

19 subsection (b). 

20 (6) A description of actions that are planned, 

21 underway, or might reasonably be considered to in22 crease hydroelectric power production by replacing 

23 turbine runners, by performing generator upgrades 

24 or rewinds, or by construction of pumped storage fa25 cilities. 


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1 (7) The impact of increased hydroelectric power 

2 production on irrigation, water supply, fish, wildlife, 

3 Indian tribes, river health, water quality, navigation, 

4 recreation, fishing, and flood control. 

5 (8) Any additional recommendations to increase 

6 hydroelectric power production from, and reduce 

7 costs and improve efficiency at, federally owned or 

8 operated water regulation, storage, and conveyance 

9 facilities. 

10 SEC. 196. CLEAN TECHNOLOGY BUSINESS COMPETITION 

11 GRANT PROGRAM. 

12 (a) IN GENERAL.—The Secretary of Energy is au13 thorized to provide grants to organizations to conduct 

14 business competitions that provide incentives, training, 

15 and mentorship to entrepreneurs and early stage start-up 

16 companies throughout the United States to meet high pri17 ority economic, environmental, and energy security goals 

18 in areas to include energy efficiency, renewable energy, air 

19 quality, water quality and conservation, transportation, 

20 smart grid, green building, and waste management. Such 

21 competitions shall have the purpose of accelerating the de22 velopment and deployment of clean technology businesses 

23 and green jobs; stimulating green economic development; 

24 providing business training and mentoring to early stage 

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1 petitiveness of United States clean technology industry in 

2 world trade markets. Priority shall be given to business 

3 competitions that are private sector led, encourage re4 gional and interregional cooperation, and can demonstrate 

5 market-driven practices and show the creation of cost-ef6 fective green jobs through an annual publication of com7 petition activities and directory of companies. 

8 (b) ELIGIBILITY.—An organization eligible for a 

9 grant under subsection (a) is— 

10 (1) any organization described in section 

11 501(c)(3) of the Internal Revenue Code of 1986 and 

12 exempt from tax under section 501(a) of such Code; 

13 and 

14 (2) any sponsored entity of an organization de15 scribed in paragraph (1) that is operated as a non16 profit entity. 

17 (c) PRIORITY.—In making grants under this section, 

18 the Secretary shall give priority to those organizations 

19 that can demonstrate broad funding support from private 

20 and other non-Federal funding sources to leverage Federal 

21 investment. 

22 (d) AUTHORIZATION OF APPROPRIATIONS.—For the 

23 purpose of carrying out this section, there are authorized 

24 to be appropriated $20,000,000. 


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1 SEC. 197. NATIONAL BIOENERGY PARTNERSHIP. 

2 (a) IN GENERAL.—The Secretary of Energy shall es3 tablish a National Bioenergy Partnership to provide co4 ordination among programs of State governments, the 

5 Federal Government, and the private sector that support 

6 the institutional and physical infrastructure necessary to 

7 promote the deployment of sustainable biomass fuels and 

8 bioenergy technologies for the United States. 

9 (b) PROGRAM.—The National Bioenergy Partnership 

10 shall consist of five regions, to be administered by the 

11 CONEG Policy Research Center, the Council of Great 

12 Lakes Governors, the Southern States Energy Board, the 

13 Western Governors Association, and the Pacific Regional 

14 Biomass Energy Partnership led by the Washington State 

15 University Energy Program. 

16 (c) AUTHORIZATION OF APPROPRIATIONS.—There 

17 are authorized to be appropriated for each of fiscal years 

18 2010 through 2014 to carry out this section— 

19 (1) $5,000,000, to be allocated among the 5 re20 gions described in subsection (b) on the basis of the 

21 number of States in each region, for distribution 

22 among the member States of that region based on 

23 procedures developed by the member States of the 

24 region; and 

25 (2) $2,500,000, to be allocated equally among 

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1 wide activities, including technical assistance and re2 gional studies and coordination. 

3 SEC. 198. OFFICE OF CONSUMER ADVOCACY. 

4 Section 319 of the Federal Power Act is amended to 

5 read as follows: 

6 ‘‘SEC. 319. OFFICE OF CONSUMER ADVOCACY. 

7 ‘‘(a) OFFICE.— 

8 ‘‘(1) ESTABLISHMENT.—There is established 

9 within the Commission an Office of Consumer Advo10 cacy to serve as an advocate for the public interest. 

11 The Office of Administrative Litigation within the 

12 Commission shall be incorporated into the Office of 

13 Consumer Advocacy. 

14 ‘‘(2) DIRECTOR.—The Office shall be headed by 

15 a Director to be appointed by the President by and 

16 with the advice and consent of the Senate from 

17 among individuals who are licensed attorneys admit18 ted to the Bar of any State or of the District of Co19 lumbia and who have experience in public utility pro20 ceedings. 

21 ‘‘(3) DUTIES.—The Office may— 

22 ‘‘(A) represent the interests of energy cus23 tomers— 

24 ‘‘(i) on matters before the Commission 

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1 ties and natural gas companies under the 

2 jurisdiction of the Commission; 

3 ‘‘(ii) as amicus curiae, in the review in 

4 the courts of the United States of rulings 

5 by the Commission in such matters; and 

6 ‘‘(iii) as amicus, in hearings and pro7 ceedings in other Federal regulatory agen8 cies and commissions related to such mat9 ters; 

10 ‘‘(B) monitor and review energy customer 

11 complaints and grievances on matters con12 cerning rates or service of public utilities and 

13 natural gas companies under the jurisdiction of 

14 the Commission; 

15 ‘‘(C) investigate independently, or within 

16 the context of formal proceedings, the services 

17 provided by, the rates charged by, and the valu18 ation of the properties of, public utilities and 

19 natural gas companies under the jurisdiction of 

20 the Commission; 

21 ‘‘(D) develop means, such as public dis22 semination of information, consultative services, 

23 and technical assistance, to ensure, to the max24 imum extent practicable, that the interests of 

25 energy consumers are adequately represented in 


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1 the course of any hearing or proceeding de2 scribed in subparagraph (A); 

3 ‘‘(E) collect data concerning rates or serv4 ice of public utilities and natural gas companies 

5 under the jurisdiction of the Commission; and 

6 ‘‘(F) prepare and issue reports and rec7 ommendations. 

8 ‘‘(4) COMPENSATION AND POWERS.—The Di9 rector shall be compensated at Level IV of the Exec10 utive Schedule. The Director may— 

11 ‘‘(A) employ not more than 25 full-time 

12 professional employees at appropriate levels in 

13 the GS Scale and such additional support per14 sonnel as required; and 

15 ‘‘(B) procure temporary and intermittent 

16 services as needed. 

17 ‘‘(5) INFORMATION FROM OTHER FEDERAL

18 AGENCIES.—The Director may request, from any de19 partment, agency, or instrumentality of the United 

20 States such information as he deems necessary to 

21 carry out his functions under this section. Upon 

22 such request, the head of the department, agency, or 

23 instrumentality concerned shall, to the extent prac24 ticable and authorized by law, provide such informa25 tion to the Office. 


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1 ‘‘(b) CONSUMER ADVOCACY ADVISORY COM2 MITTEE.— 

3 ‘‘(1) ESTABLISHMENT.—The Director shall es4 tablish an advisory committee to be known as Con5 sumer Advocacy Advisory Committee (in this section 

6 referred to as the ‘Advisory Committee’) to review 

7 rates, services, and disputes and to make rec8 ommendations to the Director. 

9 ‘‘(2) COMPOSITION.—The Director shall ap10 point 5 members to the Advisory Committee includ11 ing— 

12 ‘‘(A) 2 individuals representing State util13 ity consumer advocates; and 

14 ‘‘(B) 1 individual, from a nongovernmental 

15 organization representing consumers. 

16 ‘‘(3) MEETINGS.—The Advisory Committee 

17 shall meet at such frequency as may be required to 

18 carry out its duties. 

19 ‘‘(4) REPORTS.—The Director shall provide for 

20 the publication of recommendations of the Advisory 

21 Committee on the public website established for the 

22 Office. 

23 ‘‘(5) DURATION.—Notwithstanding any other 

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1 tinue in operation during the period for which the 

2 Office exists. 

3 ‘‘(c) DEFINITIONS.— 

4 ‘‘(1) ENERGY CUSTOMER.—The term ‘energy 

5 customer’ means a residential customer or a small 

6 commercial customer that receives products or serv7 ices directly or indirectly from a public utility or 

8 natural gas company under the jurisdiction of the 

9 Commission. 

10 ‘‘(2) NATURAL GAS COMPANY.—The term ‘nat11 ural gas company’ has the meaning given the term 

12 in section 2 of the Natural Gas Act (15 U.S.C. 

13 717a), as modified by section 601(a) of the Natural 

14 Gas Policy Act of 1978 (15 U.S.C. 3431(a)). 

15 ‘‘(3) OFFICE.—The term ‘Office’ means the Of16 fice of Consumer Advocacy established under this 

17 section. 

18 ‘‘(4) PUBLIC UTILITY.—The term ‘public util19 ity’ has the meaning given the term in section 

20 201(e) of this Act. 

21 ‘‘(5) SMALL COMMERCIAL CUSTOMER.—The 

22 term ‘small commercial customer’ means a commer23 cial customer that has a peak demand of not more 

24 than 1,000 kilowatts per hour. 


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1 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 

2 are authorized to be appropriated such sums as necessary 

3 to carry out this section. 

4 ‘‘(e) SAVINGS CLAUSE.—Nothing in this section af5 fects the rights or obligations of any State utility con6 sumer advocate.’’. 

7 TITLE II—ENERGY EFFICIENCY 

8 Subtitle A—Building Energy 

9 Efficiency Programs 

10 SEC. 201. GREATER ENERGY EFFICIENCY IN BUILDING 

11 CODES. 

12 Section 304 of the Energy Conservation and Produc13 tion Act (42 U.S.C. 6833) is amended to read as follows: 

14 ‘‘SEC. 304. GREATER ENERGY EFFICIENCY IN BUILDING 

15 CODES. 

16 ‘‘(a) ENERGY EFFICIENCY TARGETS.— 

17 ‘‘(1) IN GENERAL.—Except as provided in para18 graph (2) or (3), the national building code energy 

19 efficiency target for the national average percentage 

20 improvement of a building’s energy performance 

21 when built to a code meeting the target shall be— 

22 ‘‘(A) effective on the date of enactment of 

23 the American Clean Energy and Security Act of 

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1 ative to a comparable building constructed in 

2 compliance with the baseline code; 

3 ‘‘(B) effective January 1, 2014, for resi4 dential buildings, and January 1, 2015, for 

5 commercial buildings, 50 percent reduction in 

6 energy use relative to the baseline code; and 

7 ‘‘(C) effective January 1, 2017, for resi8 dential buildings, and January 1, 2018, for 

9 commercial buildings, and every 3 years there10 after, respectively, through January 1, 2029, 

11 and January 1, 2030, 5 percent additional re12 duction in energy use relative to the baseline 

13 code. 

14 ‘‘(2) CONSENSUS-BASED CODES.—If on any ef15 fective date specified in paragraph (1)(A), (B), or 

16 (C) a successor code to the baseline codes provides 

17 for greater reduction in energy use than is required 

18 under paragraph (1), the overall percentage reduc19 tion in energy use provided by that successor code 

20 shall be the national building code energy efficiency 

21 target. 

22 ‘‘(3) TARGETS ESTABLISHED BY SECRETARY.— 

23 The Secretary may by rule establish a national 

24 building code energy efficiency target for residential 

25 or commercial buildings achieving greater reductions 


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1 in energy use than the targets prescribed in para2 graph (1) or (2) if the Secretary determines that 

3 such greater reductions in energy use can be 

4 achieved with a code that is life cycle cost-justified 

5 and technically feasible. The Secretary may by rule 

6 establish a national building code energy efficiency 

7 target for residential or commercial buildings achiev8 ing a reduction in energy use that is greater than 

9 zero but less than the targets prescribed in para10 graph (1) or (2) if the Secretary determines that 

11 such lesser target is the maximum reduction in en12 ergy use that can be achieved through a code that 

13 is life cycle cost-justified and technically feasible. 

14 ‘‘(4) ADDITIONAL REDUCTIONS IN ENERGY

15 USE.—Effective on January 1, 2033, and once every 

16 3 years thereafter, the Secretary shall determine, 

17 after notice and opportunity for comment, whether 

18 further energy efficiency building code improvements 

19 for residential or commercial buildings, respectively, 

20 are life cycle cost-justified and technically feasible, 

21 and shall establish updated national building code 

22 energy efficiency targets that meet such criteria. 

23 ‘‘(5) ZERO-NET-ENERGY BUILDINGS.—In set24 ting targets under this subsection, the Secretary 

25 shall consider ways to support the deployment of 


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1 distributed renewable energy technology, and shall 

2 seek to achieve the goal of zero-net-energy commer3 cial buildings established in section 422 of the En4 ergy Independence and Security Act of 2007 (42 

5 U.S.C. 17082). 

6 ‘‘(6) BASELINE CODE.—For purposes of this 

7 section, the term ‘baseline code’ means— 

8 ‘‘(A) for residential buildings, the 2006 

9 International Energy Conservation Code 

10 (IECC) published by the International Code 

11 Council (ICC); and 

12 ‘‘(B) for commercial buildings, the code 

13 published in ASHRAE Standard 90.1-2004. 

14 ‘‘(7) CONSULTATION.—In establishing the tar15 gets required by this section, the Secretary shall 

16 consult with the Director of the National Institute of 

17 Standards and Technology. 

18 ‘‘(b) NATIONAL ENERGY EFFICIENCY BUILDING

19 CODES.— 

20 ‘‘(1) REQUIREMENT.— 

21 ‘‘(A) IN GENERAL.—There shall be estab22 lished national energy efficiency building codes 

23 under this subsection, for residential and com24 mercial buildings, sufficient to meet each of the 

25 national building code energy efficiency targets 


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1 established under subsection (a), not later than 

2 the date that is one year after the deadline for 

3 establishment of each such target, except that 

4 the national energy efficiency building code es5 tablished to meet the target described in sub6 section (a)(1)(A) shall be established by not 

7 later than 15 months after the effective date of 

8 that target. 

9 ‘‘(B) EXISTING CODE.—If the Secretary 

10 finds prior to the date provided in subpara11 graph (A) for establishing a national code for 

12 any target that one or more energy efficiency 

13 building codes published by a recognized devel14 oper of national energy codes and standards 

15 meet or exceed the established target, the Sec16 retary shall select the code that meets the tar17 get with the highest efficiency in the most cost18 effective manner, and such code shall be the na19 tional energy efficiency building code. 

20 ‘‘(C) REQUIREMENT TO ESTABLISH

21 CODE.—If the Secretary does not make a find22 ing under subparagraph (B), the national en23 ergy efficiency building code shall be established 

24 by rule by the Secretary under paragraph (2). 

25 ‘‘(2) ESTABLISHMENT BY SECRETARY.— 


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1 ‘‘(A) PROCEDURE.—In order to establish a 

2 national energy efficiency building code as re3 quired under paragraph (1)(C), the Secretary 

4 shall— 

5 ‘‘(i) not later than six months prior to 

6 the effective date for each target, review 

7 existing and proposed codes published or 

8 under review by recognized developers of 

9 national energy codes and standards; 

10 ‘‘(ii) determine the percentage of en11 ergy efficiency improvements that are or 

12 would be achieved in such published or 

13 proposed code versions relative to the tar14 get; 

15 ‘‘(iii) propose improvements to such 

16 published or proposed code versions suffi17 cient to meet or exceed the target; and 

18 ‘‘(iv) unless a finding is made under 

19 paragraph (1)(B) with respect to a code 

20 published by a recognized developer of na21 tional energy codes and standards, adopt a 

22 code that meets or exceeds the relevant na23 tional building code energy efficiency tar24 get by not later than one year after the ef25 fective date of each such target, and by not 


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1 later than 15 months after the target is es2 tablished under subsection (a)(1)(A). 

3 ‘‘(B) CALCULATIONS.—Each national en4 ergy efficiency building code established by the 

5 Secretary under this paragraph shall be set at 

6 the maximum level the Secretary determines is 

7 life cycle cost-justified and technically feasible, 

8 in accordance with the following: 

9 ‘‘(i) SAVINGS CALCULATIONS.—Cal10 culations of energy savings shall take into 

11 account the typical lifetimes of different 

12 products, measures, and system configura13 tions. 

14 ‘‘(ii) COST-EFFECTIVENESS CALCULA15 TIONS.—Calculations of life cycle cost-ef16 fectiveness shall be based on life cycle cost 

17 methods and procedures under section 544 

18 of the National Energy Conservation Pol19 icy Act (42 U.S.C. 8254), but shall incor20 porate to the extent feasible externalities 

21 such as impacts on climate change and on 

22 peak energy demand that are not already 

23 incorporated in assumed energy costs. 


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1 ‘‘(C) CONSIDERATIONS.—In developing a 

2 national energy efficiency building code under 

3 this paragraph, the Secretary shall consider— 

4 ‘‘(i) for residential national energy ef5 ficiency building codes— 

6 ‘‘(I) residential building stand7 ards published or proposed by 

8 ASHRAE; 

9 ‘‘(II) building codes published or 

10 proposed by the International Code 

11 Council (ICC); 

12 ‘‘(III) data from the Residential 

13 Energy Services Network (RESNET) 

14 on compliance measures utilized by 

15 consumers to qualify for the residen16 tial energy efficiency tax credits estab17 lished under the Energy Policy Act of 

18 2005; 

19 ‘‘(IV) data and information from 

20 the Department of Energy’s Building 

21 America Program; 

22 ‘‘(V) data and information from 

23 the Energy Star New Homes pro24 gram; 


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1 ‘‘(VI) data and information from 

2 the New Building Institute and simi3 lar organizations; and 

4 ‘‘(VII) standards for practices 

5 and materials to achieve cool roofs in 

6 residential buildings, taking into con7 sideration reduced air conditioning en8 ergy use as a function of cool roofs, 

9 the potential reduction in global 

10 warming from increased solar reflec11 tance from buildings, and cool roofs 

12 criteria in State and local building 

13 codes and in national and local vol14 untary programs, without reduction of 

15 otherwise applicable ceiling insulation 

16 standards; and 

17 ‘‘(ii) for commercial national energy 

18 efficiency building codes— 

19 ‘‘(I) commercial building stand20 ards proposed by ASHRAE; 

21 ‘‘(II) building codes proposed by 

22 the International Code Council (ICC); 

23 ‘‘(III) the Core Performance Cri24 teria published by the New Buildings 

25 Institute; 


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1 ‘‘(IV) data and information de2 veloped by the Director of the Com3 mercial High-Performance Green 

4 Building Office of the Department of 

5 Energy and any public-private part6 nerships established under that Office; 

7 ‘‘(V) data and information from 

8 the Energy Star for Buildings pro9 gram; 

10 ‘‘(VI) data and information from 

11 the New Building Institute, 

12 RESNET, and similar organizations; 

13 and 

14 ‘‘(VII) standards for practices 

15 and materials to achieve cool roofs in 

16 commercial buildings, taking into con17 sideration reduced air conditioning en18 ergy use as a function of cool roofs, 

19 the potential reduction in global 

20 warming from increased solar reflec21 tance from buildings, and cool roofs 

22 criteria in State and local building 

23 codes and in national and local vol24 untary programs, without reduction of 


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1 otherwise applicable ceiling insulation 

2 standards. 

3 ‘‘(D) CONSULTATION.—In establishing any 

4 national energy efficiency building code re5 quired by this section, the Secretary shall con6 sult with the Director of the National Institute 

7 of Standards and Technology. 

8 ‘‘(3) CONSENSUS STANDARD ASSISTANCE.—(A) 

9 To support the development of consensus standards 

10 that may provide the basis for national energy effi11 ciency building codes, minimize duplication of effort, 

12 encourage progress through consensus, and facilitate 

13 the development of greater building efficiency, the 

14 Secretary shall provide assistance to recognized de15 velopers of national energy codes and standards to 

16 develop, and where the relevant code has been adopt17 ed as the national code, disseminate consensus based 

18 energy efficiency building codes as provided in this 

19 paragraph. 

20 ‘‘(B) Upon a finding by the Secretary that a 

21 code developed by such a developer meets a target 

22 established under subsection (a), the Secretary 

23 shall— 


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1 ‘‘(i) send notice of the Secretary’s finding 

2 to all duly authorized or appointed State, tribal, 

3 and local code agencies; and 

4 ‘‘(ii) provide sufficient support to such a 

5 developer to make the code available on the 

6 Internet, or to accomplish distribution of such 

7 code to all such State, tribal, and local code 

8 agencies at no cost to the State, tribal, and 

9 local code agencies. 

10 ‘‘(C) The Secretary may contract with such a 

11 developer and with other organizations with exper12 tise on codes to provide training for State, tribal, 

13 and local code officials and building inspectors in the 

14 implementation and enforcement of such code. 

15 ‘‘(D) The Secretary may provide grants and 

16 other support to such a developer to— 

17 ‘‘(i) develop appropriate refinements to 

18 such code; and 

19 ‘‘(ii) support analysis of options for im20 provements in the code to meet the next sched21 uled target. 

22 ‘‘(4) CODE DEVELOPED BY SECRETARY.—If the 

23 Secretary establishes a national energy efficiency 

24 building code under paragraph (2), the Secretary 

25 shall— 


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1 ‘‘(A) to the extent that such code is based 

2 on a prior code developed by a recognized devel3 oper of national energy codes and standards, 

4 negotiate and provide appropriate compensation 

5 to such developer for the use of the code mate6 rials that remain in the code established by the 

7 Secretary; and 

8 ‘‘(B) disseminate the national energy effi9 ciency building codes to State, tribal, and local 

10 code officials, and support training and provide 

11 guidance and technical assistance to such offi12 cials as appropriate. 

13 ‘‘(c) STATE ADOPTION OF ENERGY EFFICIENCY

14 BUILDING CODES.— 

15 ‘‘(1) REQUIREMENT.—Not later than 1 year 

16 after a national energy efficiency building code for 

17 residential or commercial buildings is established or 

18 revised under subsection (b), each State— 

19 ‘‘(A) shall— 

20 ‘‘(i) review and update the provisions 

21 of its building code regarding energy effi22 ciency to meet or exceed the target met in 

23 the new national energy efficiency building 

24 code, to achieve equivalent or greater en25 ergy savings; 


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1 ‘‘(ii) document, where local govern2 ments establish building codes, that local 

3 governments representing not less than 80 

4 percent of the State’s urban population 

5 have adopted the new national code, or 

6 have adopted local codes that meet or ex7 ceed the target met in the new national 

8 code to achieve equivalent or greater en9 ergy savings; or 

10 ‘‘(iii) adopt the new national code; 

11 and 

12 ‘‘(B) shall provide a certification to the 

13 Secretary demonstrating that energy efficiency 

14 building code provisions that apply pursuant to 

15 subparagraph (A) in that State meet or exceed 

16 the target met by the new national code, to 

17 achieve equivalent or greater energy savings. 

18 ‘‘(2) CONFIRMATION.— 

19 ‘‘(A) REQUIREMENT.—Not later than 90 

20 days after a State certification is provided 

21 under paragraph (1)(B), the Secretary shall de22 termine whether the State’s energy efficiency 

23 building code provisions meet the requirements 

24 of this subsection. 


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1 ‘‘(B) ACCEPTANCE BY SECRETARY.—If the 

2 Secretary determines under subparagraph (A) 

3 that the State’s energy efficiency building code 

4 or codes meet the requirements of this sub5 section, the Secretary shall accept the certifi6 cation. 

7 ‘‘(C) DEFICIENCY NOTICE.—If the Sec8 retary determines under subparagraph (A) that 

9 the State’s building code or codes do not meet 

10 the requirements of this subsection, the Sec11 retary shall identify the deficiency in meeting 

12 the national building code energy efficiency tar13 get, and, to the extent possible, indicate areas 

14 where further improvement in the State’s code 

15 provisions would allow the deficiency to be 

16 eliminated. 

17 ‘‘(D) REVISION OF CODE AND RECERTIFI18 CATION.—A State may revise its code or codes 

19 and submit a recertification under paragraph 

20 (1)(B) to the Secretary at any time. 

21 ‘‘(3) COMPLIANT CODE.—For the purposes of 

22 meeting the target described in subsection (a)(1)(A) 

23 for residential buildings, a State that adopts the 

24 code represented in California’s Title 24-2009 by the 

25 date 27 months after the date of enactment of the 


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1 American Clean Energy and Security Act of 2009 

2 shall be considered to have met the requirements of 

3 this subsection for the applicable period. 

4 ‘‘(d) APPLICATION OF NATIONAL CODE TO STATE

5 AND LOCAL JURISDICTIONS.— 

6 ‘‘(1) IN GENERAL.—Upon the expiration of 18 

7 months after a national energy efficiency building 

8 code is established under subsection (b), in any ju9 risdiction where the State has not had a certification 

10 relating to that code accepted by the Secretary 

11 under subsection (c)(2)(B), and the local govern12 ment has not had a certification relating to that 

13 code accepted by the Secretary under subsection 

14 (e)(5), the national energy efficiency building code 

15 shall become the applicable energy efficiency build16 ing code for such jurisdiction. 

17 ‘‘(2) CONFLICTS.—In the event of a conflict be18 tween a provision of the national energy efficiency 

19 building code and a provision of other applicable en20 ergy codes, the national energy efficiency building 

21 code shall apply. If there is a conflict between a pro22 vision of the national energy efficiency building code 

23 and a provision of any applicable fire code, life safe24 ty code, egress code, or accessibility code, the Sec25 retary shall take appropriate actions to resolve such 


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1 conflict in a manner that does not compromise the 

2 objectives of such codes. 

3 ‘‘(3) STATE LEGISLATIVE ADOPTION.—In a 

4 State in which the relevant building energy code is 

5 adopted legislatively, the deadline in paragraph (1) 

6 shall not be earlier than 1 year after the first day 

7 that the legislature meets following establishment of 

8 a national energy efficiency building code. 

9 ‘‘(4) NOTICE OF INTENT TO ENFORCE.—A 

10 State or locality that enforces building codes may as11 sume responsibility for enforcing the national energy 

12 efficiency building code by notifying the Secretary to 

13 that effect not later than three months after the 

14 date established under paragraph (1). 

15 ‘‘(5) VIOLATIONS.—Violations of this section 

16 shall be defined as follows: 

17 ‘‘(A) If the building is subject to the re18 quirements of a State energy efficiency building 

19 code with respect to which a certification has 

20 been accepted by the Secretary under sub21 section (c)(2)(B) or a local energy efficiency 

22 building code with respect to which a certifi23 cation has been accepted by the Secretary pur24 suant to subsection (e)(5), or the requirements 

25 of the national energy efficiency building code 


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1 in a State where the State or locality has noti2 fied the Secretary of its intent to enforce the 

3 provisions of the national energy efficiency 

4 building code, a violation shall be determined 

5 pursuant to the relevant provisions of State or 

6 local law. 

7 ‘‘(B) If the building is subject to the re8 quirements of a national energy efficiency build9 ing code made applicable under paragraph (1) 

10 of this subsection, except as provided in sub11 paragraph (A), a violation shall be defined by 

12 the Secretary pursuant to subsection (g). 

13 ‘‘(e) STATE ENFORCEMENT OF ENERGY EFFICIENCY

14 BUILDING CODES.— 

15 ‘‘(1) IN GENERAL.—Each State, or where appli16 cable under State law each local government, shall 

17 implement and enforce applicable State or local 

18 codes with respect to which a certification was ac19 cepted by the Secretary under subsection (c)(2)(B) 

20 or paragraph (5) of this subsection, or the national 

21 energy efficiency building codes, as provided in this 

22 subsection. 

23 ‘‘(2) STATE CERTIFICATION.—Not later than 2 

24 years after the date of a certification under sub25 section (c)(1) or the application of a national energy 


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1 efficiency building code under subsection (d)(1), 

2 each State shall certify that it has— 

3 ‘‘(A) achieved compliance with— 

4 ‘‘(i) State codes, or, as provided under 

5 State law, local codes, with respect to 

6 which a certification was accepted by the 

7 Secretary under subsection (c)(2)(B); or 

8 ‘‘(ii) the national energy efficiency 

9 building code, as applicable; or 

10 ‘‘(B) for any certification submitted within 

11 7 years after the date of enactment of the 

12 American Clean Energy and Security Act of 

13 2009, made significant progress toward achiev14 ing such compliance. 

15 ‘‘(3) ACHIEVING COMPLIANCE.—A State shall 

16 be considered to achieve compliance with a code de17 scribed in paragraph (2)(A) if at least 90 percent of 

18 new and substantially renovated building space in 

19 that State in the preceding year upon inspection 

20 meets the requirements of the code. A certification 

21 under paragraph (2) shall include documentation of 

22 the rate of compliance based on— 

23 ‘‘(A) independent inspections of a random 

24 sample of the new and substantially renovated 


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1 buildings covered by the code in the preceding 

2 year; or 

3 ‘‘(B) an alternative method that yields an 

4 accurate measure of compliance as determined 

5 by the Secretary. 

6 ‘‘(4) SIGNIFICANT PROGRESS.—A State shall be 

7 considered to have made significant progress toward 

8 achieving compliance with a code described in para9 graph (2)(A) if— 

10 ‘‘(A) the State has developed a plan, in11 cluding for hiring enforcement staff, providing 

12 training, providing manuals and checklists, and 

13 instituting enforcement programs, designed to 

14 achieve full compliance within 5 years after the 

15 date of the adoption of the code; 

16 ‘‘(B) the State is taking significant, timely, 

17 and measurable action to implement that plan; 

18 ‘‘(C) the State has not reduced its expendi19 tures for code enforcement; and 

20 ‘‘(D) at least 50 percent of new and sub21 stantially renovated building space in the State 

22 in the preceding year upon inspection meets the 

23 requirements of the code. 

24 ‘‘(5) SECRETARY’S DETERMINATION.—Not later 

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1 graph (2), the Secretary shall determine whether the 

2 State has demonstrated that it has complied with 

3 the requirements of this subsection, including accu4 rate measurement of compliance, or that it has made 

5 significant progress toward compliance. If such de6 termination is positive, the Secretary shall accept 

7 the certification. If the determination is negative, 

8 the Secretary shall identify the areas of deficiency. 

9 ‘‘(6) OUT OF COMPLIANCE.— 

10 ‘‘(A) IN GENERAL.—Any State for which 

11 the Secretary has not accepted a certification 

12 under paragraph (5) by the dates specified in 

13 paragraph (2) is out of compliance with this 

14 section. 

15 ‘‘(B) LOCAL COMPLIANCE.—In any State 

16 that is out of compliance with this section as 

17 provided in subparagraph (A), a local govern18 ment may be in compliance with this section by 

19 meeting all certification requirements of this 

20 subsection. 

21 ‘‘(C) NONCOMPLIANCE.—Any State that is 

22 not in compliance with this section, as provided 

23 in subparagraph (A), shall, until the State re24 gains such compliance, be ineligible to receive— 


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1 ‘‘(i) emission allowances pursuant to 

2 subsection (h)(1); 

3 ‘‘(ii) Federal funding in excess of that 

4 State’s share (calculated according to the 

5 allocation formula in section 363 of the 

6 Energy Policy and Conservation Act (42 

7 U.S.C. 6323)) of $125,000,000 each year; 

8 and 

9 ‘‘(iii) for— 

10 ‘‘(I) the first year for which the 

11 State is out of compliance, 25 percent 

12 of any additional funding or other 

13 items of monetary value otherwise 

14 provided under the American Clean 

15 Energy and Security Act of 2009; 

16 ‘‘(II) the second year for which 

17 the State is out of compliance, 50 per18 cent of any additional funding or 

19 other items of monetary value other20 wise provided under the American 

21 Clean Energy and Security Act of 

22 2009; 

23 ‘‘(III) the third year for which 

24 the State is out of compliance, 75 per25 cent of any additional funding or 


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1 other items of monetary value other2 wise provided under the American 

3 Clean Energy and Security Act of 

4 2009; and 

5 ‘‘(IV) the fourth and subsequent 

6 years for which the State is out of 

7 compliance, 100 percent of any addi8 tional funding or other items of mone9 tary value otherwise provided under 

10 the American Clean Energy and Secu11 rity Act of 2009. 

12 ‘‘(f) FEDERAL ENFORCEMENT AND TRAINING.— 

13 Where a State fails and local governments in that State 

14 also fail to enforce the applicable State or national energy 

15 efficiency building codes, the Secretary shall enforce such 

16 codes, as follows: 

17 ‘‘(1) The Secretary shall establish, by rule, 

18 within 2 years after the date of enactment of the 

19 American Clean Energy and Security Act of 2009, 

20 an energy efficiency building code enforcement capa21 bility. 

22 ‘‘(2) Such enforcement capability shall be de23 signed to achieve 90 percent compliance with such 

24 code in any State within 1 year after the date of the 


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1 Secretary’s determination that such State is out of 

2 compliance with this section. 

3 ‘‘(3) The Secretary may set and collect reason4 able inspection fees to cover the costs of inspections 

5 required for such enforcement. Revenue from fees 

6 collected shall be available to the Secretary to carry 

7 out the requirements of this section upon appropria8 tion. 

9 ‘‘(4) In any jurisdiction to which this subsection 

10 applies, the Secretary shall coordinate enforcement 

11 of the national energy efficiency building code with 

12 State and local code enforcement of other building 

13 codes. 

14 ‘‘(5) In any jurisdiction to which this subsection 

15 applies, the Secretary shall enhance compliance by 

16 conducting training and education of builders and 

17 other professionals in the jurisdiction concerning the 

18 national energy efficiency building code. 

19 ‘‘(6) The Secretary shall coordinate with profes20 sional organizations representing code officials, ar21 chitects, engineers, builders, and other experts to de22 velop training curricula concerning the national en23 ergy efficiency building code. 


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1 ‘‘(7) If the Secretary enforces such codes under 

2 this subsection, the Secretary may, as appropriate, 

3 redefine violations of such codes. 

4 ‘‘(g) ENFORCEMENT PROCEDURES.—The Secretary 

5 shall propose and, not later than three years after the date 

6 of enactment of the American Clean Energy and Security 

7 Act of 2009, shall define by rule violations of the energy 

8 efficiency building codes to be enforced by the Secretary 

9 pursuant to this section, and the penalties that shall apply 

10 to violators, in any jurisdiction in which the national en11 ergy efficiency building code has been made applicable 

12 under subsection (d)(1). To the extent that the Secretary 

13 determines that the authority to adopt and impose such 

14 violations and penalties by rule requires further statutory 

15 authority, the Secretary shall report such determination 

16 to Congress as soon as such determination is made, but 

17 not later than one year after the enactment of the Amer18 ican Clean Energy and Security Act of 2009. 

19 ‘‘(h) FEDERAL SUPPORT.— 

20 ‘‘(1) ALLOWANCE ALLOCATION FOR STATE

21 COMPLIANCE.—For each vintage year from 2012 

22 through 2050, the Administrator shall distribute al23 lowances allocated pursuant to section 782(g)(2) of 

24 the Clean Air Act to the SEED Account for each 


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1 State. Such allowances shall be distributed according 

2 to a formula established by the Secretary as follows: 

3 ‘‘(A) One-fifth in an equal amount to each 

4 of the 50 States and United States territories. 

5 ‘‘(B) Two-fifths as a function of the rel6 ative energy use in all buildings in each State 

7 in the most recent year for which data is avail8 able. 

9 ‘‘(C) Two-fifths based on the number of 

10 building construction starts recorded in each 

11 State, the number of new building permits ap12 plied for in each State, or other relevant avail13 able data indicating building activity in each 

14 State, in the judgment of the Secretary, for the 

15 year prior to the year of the distribution. 

16 ‘‘(2) ALLOWANCE ALLOCATION TO LOCAL GOV17 ERNMENTS.—In the instance that the Secretary cer18 tifies that one or more local governments are in com19 pliance with this section pursuant to subsection 

20 (e)(6)(B), the Administrator shall provide to each 

21 such local government the portion of the emission al22 lowances that would have been provided to that 

23 State as a function of the population of that locality 

24 as a proportion of the population of that State as a 

25 whole. 


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1 ‘‘(3) UNALLOCATED ALLOWANCES.—To the ex2 tent that allowances are not provided to State or 

3 local governments for lack of certification in any 

4 year, those allowances shall be added to the amount 

5 provided to those States and local governments that 

6 are certified as eligible in that year. 

7 ‘‘(4) USE OF ALLOWANCES.—Each State or 

8 each local government shall use such emission allow9 ances as it receives pursuant to this section exclu10 sively for the purposes of this section, including cov11 ering a reasonable portion of the costs of the devel12 opment, adoption, implementation, and enforcement 

13 of a State or local energy efficiency building code 

14 that meets the national building code energy effi15 ciency targets, or the national energy efficiency 

16 building code. In a State where local governments 

17 provide substantially all building code enforcement, 

18 a minimum of 50 percent of the allowance value re19 ceived pursuant to this section shall be distributed to 

20 local governments as a function of the relative popu21 lations of such localities. In a State where local and 

22 State governments share building code enforcement 

23 duties, the State and local shares of allowance value 

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1 formed by each level of government, and the share 

2 for local governments shall be distributed as a func3 tion of the relative populations of such localities. 

4 States shall further ensure that the allowance value 

5 made available pursuant to section 782 of the Clean 

6 Air Act and section 132 of the American Clean En7 ergy and Security Act of 2009 is provided to the ap8 plicable State or local governmental entities as nec9 essary to adopt and implement energy efficiency 

10 building codes, provide training for inspectors, en11 sure compliance, and provide such other functions as 

12 necessary. Actions taken by local authorities pursu13 ant to this section shall constitute an acceptable use 

14 of funds authorized pursuant to the Energy Effi15 ciency and Conservation Block Grant program under 

16 section 544 of the Energy Independence and Secu17 rity Act of 2007 (42 U.S.C. 17154). 

18 ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There 

19 are authorized to be appropriated to the Secretary of En20 ergy $25,000,000, and such additional sums as may be 

21 necessary to provide enforcement of a national energy effi22 ciency building code, for each of fiscal years 2010 through 

23 2020, and such sums thereafter as may be necessary to 

24 support the purposes of this section. 


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1 ‘‘(j) ANNUAL REPORTS BY SECRETARY.—The Sec2 retary shall annually submit to Congress, and publish in 

3 the Federal Register, a report on— 

4 ‘‘(1) the status of national energy efficiency 

5 building codes; 

6 ‘‘(2) the status of energy efficiency building 

7 code adoption and compliance in the States; 

8 ‘‘(3) the implementation of this section; 

9 ‘‘(4) the status of Federal enforcement of build10 ing codes, including coordination with State and 

11 local enforcement, and the extent and resolution of 

12 any conflicts between the national energy efficiency 

13 building code and other residential and commercial 

14 building codes in force in the same jurisdictions; and 

15 ‘‘(5) impacts of past action under this section, 

16 and potential impacts of further action, on lifetime 

17 energy use by buildings, including resulting energy 

18 and cost savings.’’. 

19 SEC. 202. BUILDING RETROFIT PROGRAM. 

20 (a) DEFINITIONS.—For purposes of this section: 

21 (1) ASSISTED HOUSING.—The term ‘‘assisted 

22 housing’’ means those properties receiving project23 based assistance pursuant to section 202 of the 

24 Housing Act of 1959 (12 U.S.C. 1701q), section 

25 811 of the Cranston-Gonzalez National Affordable 


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1 Housing Act (42 U.S.C. 8013), section 8 of the 

2 United States Housing Act of 1937 (42 U.S.C. 

3 1437f), or similar programs. 

4 (2) NONRESIDENTIAL BUILDING.—The term 

5 ‘‘nonresidential building’’ means a building with a 

6 primary use or purpose other than residential hous7 ing, including any building used for commercial of8 fices, schools, academic and other public and private 

9 institutions, nonprofit organizations including faith10 based organizations, hospitals, hotels, and other non11 residential purposes. Such buildings shall include 

12 mixed-use properties used for both residential and 

13 nonresidential purposes in which more than half of 

14 building floor space is nonresidential. 

15 (3) PERFORMANCE-BASED BUILDING RETROFIT

16 PROGRAM.—The term ‘‘performance-based building 

17 retrofit program’’ means a program that determines 

18 building energy efficiency success based on actual 

19 measured savings after a retrofit is complete, as evi20 denced by energy invoices or evaluation protocols. 

21 (4) PRESCRIPTIVE BUILDING RETROFIT PRO22 GRAM.—The term ‘‘prescriptive building retrofit pro23 gram’’ means a program that projects building ret24 rofit energy efficiency success based on the known 


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1 effectiveness of measures prescribed to be included 

2 in a retrofit. 

3 (5) PUBLIC HOUSING.—The term ‘‘public hous4 ing’’ means properties receiving assistance under 

5 section 9 of the United States Housing Act of 1937 

6 (42 U.S.C. 1437g). 

7 (6) RECOMMISSIONING; 

8 RETROCOMMISSIONING.—The terms ‘‘recommis9 sioning’’ and ‘‘retrocommissioning’’ have the mean10 ing given those terms in section 543(f)(1) of the Na11 tional Energy Conservation Policy Act (42 U.S.C. 

12 8253(f)(1)). 

13 (7) RESIDENTIAL BUILDING.—The term ‘‘resi14 dential building’’ means a building whose primary 

15 use is residential. Such buildings shall include sin16 gle-family homes (both attached and detached), 

17 owner-occupied units in larger buildings with their 

18 own dedicated space-conditioning systems, apart19 ment buildings, multi-unit condominium buildings, 

20 public housing, assisted housing, and buildings used 

21 for both residential and nonresidential purposes in 

22 which more than half of building floor space is resi23 dential. 

24 (8) STATE ENERGY PROGRAM.—The term 

25 ‘‘State Energy Program’’ means the program under 


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1 part D of title III of the Energy Policy and Con2 servation Act (42 U.S.C. 6321 et seq.). 

3 (b) ESTABLISHMENT.—The Administrator shall de4 velop and implement, in consultation with the Secretary 

5 of Energy, standards for a national energy and environ6 mental building retrofit policy for single-family and multi7 family residences. The Administrator shall develop and 

8 implement, in consultation with the Secretary of Energy 

9 and the Director of Commercial High-Performance Green 

10 Buildings, standards for a national energy and environ11 mental building retrofit policy for nonresidential buildings. 

12 The programs to implement the residential and nonresi13 dential policies based on the standards developed under 

14 this section shall together be known as the Retrofit for 

15 Energy and Environmental Performance (REEP) pro16 gram. 

17 (c) PURPOSE.—The purpose of the REEP program 

18 is to facilitate the retrofitting of existing buildings across 

19 the United States to achieve maximum cost-effective en20 ergy efficiency improvements and significant improve21 ments in water use and other environmental attributes. 

22 (d) FEDERAL ADMINISTRATION.— 

23 (1) EXISTING PROGRAMS.—In creating and op24 erating the REEP program— 


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1 (A) the Administrator shall make appro2 priate use of existing programs, including the 

3 Energy Star program and in particular the En4 vironmental Protection Agency Energy Star for 

5 Buildings program; and 

6 (B) the Secretary of Energy shall make 

7 appropriate use of existing programs, including 

8 delegating authority to the Director of Commer9 cial High-Performance Green Buildings ap10 pointed under section 421 of the Energy Inde11 pendence and Security Act of 2007 (42 U.S.C. 

12 17081), who shall designate and provide fund13 ing to support a high-performance green build14 ing partnership consortium pursuant to sub15 section (f) of such section to support efforts 

16 under this section. 

17 (2) CONSULTATION AND COORDINATION.—The 

18 Administrator and the Secretary of Energy shall 

19 consult with and coordinate with the Secretary of 

20 Housing and Urban Development in carrying out the 

21 REEP program with regard to retrofitting of public 

22 housing and assisted housing. As a result of such 

23 consultation, the Administrator shall establish stand24 ards to ensure that retrofits of public housing and 

25 assisted housing funded pursuant to this section are 


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1 cost-effective, including opportunities to address the 

2 potential co-performance of repair and replacement 

3 needs that may be supported with other forms of 

4 Federal assistance. 

5 (3) ASSISTANCE.—The Administrator and the 

6 Secretary of Energy shall provide consultation and 

7 assistance to State and local agencies for the estab8 lishment of revolving loan funds, loan guarantees, or 

9 other forms of financial assistance under this sec10 tion. 

11 (e) STATE AND LOCAL ADMINISTRATION.— 

12 (1) DESIGNATION AND DELEGATION.—A State 

13 may designate one or more agencies or entities, in14 cluding those regulated by the State, to carry out 

15 the purposes of this section, but shall designate one 

16 entity or individual as the principal point of contact 

17 for the Administrator regarding the REEP Pro18 gram. The designated State agency, agencies, or en19 tities may delegate performance of appropriate ele20 ments of the REEP program, upon their request 

21 and subject to State law, to counties, municipalities, 

22 appropriate public agencies, and other divisions of 

23 local government, as well as to entities regulated by 

24 the State. In making any such designation or delega25 tion, a State shall give priority to entities that adVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00329 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 minister existing comprehensive retrofit programs, 

2 including those under the supervision of State utility 

3 regulators. States shall maintain responsibility for 

4 meeting the standards and requirements of the 

5 REEP program. In any State that elects not to ad6 minister the REEP program, a unit of local govern7 ment may propose to do so within its jurisdiction, 

8 and if the Administrator finds that such local gov9 ernment is capable of administering the program, 

10 the Administrator may provide allowances to that 

11 local government, prorated according to the popu12 lation of the local jurisdiction relative to the popu13 lation of the State, for purposes of the REEP pro14 gram. 

15 (2) EMPLOYMENT.—States and local govern16 ment entities may administer a REEP program in 

17 a manner that authorizes public or regulated inves18 tor-owned utilities, building auditors and inspectors, 

19 contractors, nonprofit organizations, for-profit com20 panies, and other entities to perform audits and ret21 rofit services under this section. A State may pro22 vide incentives for retrofits without direct participa23 tion by the State or its agents, so long as the result24 ing savings are measured and verified. A State or 

25 local administrator of a REEP program shall seek 


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1 to ensure that sufficient qualified entities are avail2 able to support retrofit activities so that building 

3 owners have a competitive choice among qualified 

4 auditors, raters, contractors, and providers of serv5 ices related to retrofits. Nothing in this section is in6 tended to deny the right of a building owner to 

7 choose the specific providers of retrofit services to 

8 engage for a retrofit project in that owner’s building. 

9 (3) EQUAL INCENTIVES FOR EQUAL IMPROVE10 MENT.—In general, the States should strive to offer 

11 the same levels of incentives for retrofits that meet 

12 the same efficiency improvement goals, regardless of 

13 whether the State, its agency or entity, or the build14 ing owner has conducted the retrofit achieving the 

15 improvement, provided the improvement is measured 

16 and verified. 

17 (f) ELEMENTS OF REEP PROGRAM.—The Adminis18 trator, in consultation with the Secretary of Energy, shall 

19 establish goals, guidelines, practices, and standards for ac20 complishing the purpose stated in subsection (c), and shall 

21 annually review and, as appropriate, revise such goals, 

22 guidelines, practices, and standards. The program under 

23 this section shall include the following: 

24 (1) Residential Energy Services Network 

25 (RESNET) or Building Performance Institute 


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1 (BPI) analyst certification of residential building en2 ergy and environment auditors, inspectors, and rat3 ers, or an equivalent certification system as deter4 mined by the Administrator. 

5 (2) BPI certification or licensing by States of 

6 residential building energy and environmental ret7 rofit contractors, or an equivalent certification or li8 censing system as determined by the Administrator. 

9 (3) Provision of BPI, RESNET, or other ap10 propriate information on equipment and procedures, 

11 as determined by the Administrator, that contractors 

12 can use to test the energy and environmental effi13 ciency of buildings effectively (such as infrared pho14 tography and pressurized testing, and tests for water 

15 use and indoor air quality). 

16 (4) Provision of clear and effective materials to 

17 describe the testing and retrofit processes for typical 

18 buildings. 

19 (5) Guidelines for offering and managing pre20 scriptive building retrofit programs and perform21 ance-based building retrofit programs for residential 

22 and nonresidential buildings. 

23 (6) Guidelines for applying recommissioning 

24 and retrocommissioning principles to improve a 

25 building’s operations and maintenance procedures. 


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1 (7) A requirement that building retrofits con2 ducted pursuant to a REEP program utilize, espe3 cially in all air-conditioned buildings, roofing mate4 rials with high solar energy reflectance, unless inap5 propriate due to green roof management, solar en6 ergy production, or for other reasons identified by 

7 the Administrator, in order to reduce energy con8 sumption within the building, increase the albedo of 

9 the building’s roof, and decrease the heat island ef10 fect in the area of the building, without reduction of 

11 otherwise applicable ceiling insulation standards. 

12 (8) Determination of energy savings in a per13 formance-based building retrofit program through— 

14 (A) for residential buildings, comparison of 

15 before and after retrofit scores on the Home 

16 Energy Rating System (HERS) Index, where 

17 the final score is produced by an objective third 

18 party; 

19 (B) for nonresidential buildings, Environ20 mental Protection Agency Portfolio Manager 

21 benchmarks; or 

22 (C) for either residential or nonresidential 

23 buildings, use of an Administrator-approved 

24 simulation program by a contractor with the 

25 appropriate certification, subject to appropriate 


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1 software standards and verification of at least 

2 15 percent of all work done, or such other per3 centage as the Administrator may determine. 

4 (9) Guidelines for utilizing the Energy Star 

5 Portfolio Manager, the Home Energy Rating System 

6 (HERS) rating system, Home Performance with En7 ergy Star program approvals, and any other tools 

8 associated with the retrofit program. 

9 (10) Requirements and guidelines for post-ret10 rofit inspection and confirmation of work and energy 

11 savings. 

12 (11) Detailed descriptions of funding options 

13 for the benefit of State and local governments, along 

14 with model forms, accounting aids, agreements, and 

15 guides to best practices. 

16 (12) Guidance on opportunities for— 

17 (A) rating or certifying retrofitted build18 ings as Energy Star buildings, or as green 

19 buildings under a recognized green building rat20 ing system; 

21 (B) assigning Home Energy Rating Sys22 tem (HERS) or similar ratings; and 

23 (C) completing any applicable building per24 formance labels. 


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1 (13) Sample materials for publicizing the pro2 gram to building owners, including public service an3 nouncements and advertisements. 

4 (14) Processes for tracking the numbers and lo5 cations of buildings retrofitted under the REEP pro6 gram, with information on projected and actual sav7 ings of energy and its value over time. 

8 (g) REQUIREMENTS.—As a condition of receiving al9 lowances for the REEP program pursuant to this Act, a 

10 State or qualifying local government shall— 

11 (1) adopt the standards for training, certifi12 cation of contractors, certification of buildings, and 

13 post-retrofit inspection as developed by the Adminis14 trator for residential and nonresidential buildings, 

15 respectively, except as necessary to match local con16 ditions, needs, efficiency opportunities, or other local 

17 factors, or to accord with State laws or regulations, 

18 and then only after the Administrator approves such 

19 a variance; and 

20 (2) establish fiscal controls and accounting pro21 cedures (which conform to generally accepted gov22 ernment accounting principles) sufficient to ensure 

23 proper accounting during appropriate accounting pe24 riods for payments received and disbursements, and 

25 for fund balances. 


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1 The Administrator shall conduct or require each State to 

2 have such independent financial audits of REEP-related 

3 funding as the Administrator considers necessary or ap4 propriate to carry out the purposes of this section. 

5 (h) OPTIONS TO SUPPORT REEP PROGRAM.—The 

6 emission allowances provided pursuant to this Act to the 

7 States SEED Accounts shall support the implementation 

8 through State REEP programs of alternate means of cre9 ating incentives for, or reducing financial barriers to, im10 proved energy and environmental performance in build11 ings, consistent with this section, including— 

12 (1) implementing prescriptive building retrofit 

13 programs and performance-based building retrofit 

14 programs; 

15 (2) providing credit enhancement, interest rate 

16 subsidies, loan guarantees, or other credit support; 

17 (3) providing initial capital for public revolving 

18 fund financing of retrofits, with repayments by bene19 ficiary building owners over time through their tax 

20 payments, calibrated to create net positive cash flow 

21 to the building owner; 

22 (4) providing funds to support utility-operated 

23 retrofit programs with repayments over time 

24 through utility rates, calibrated to create net positive 

25 cash flow to the building owner, and transferable 


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1 from one building owner to the next with the build2 ing’s utility services; 

3 (5) providing funds to local government pro4 grams to provide REEP services and financial as5 sistance; and 

6 (6) other means proposed by State and local 

7 agencies, subject to the approval of the Adminis8 trator. 

9 (i) SUPPORT FOR PROGRAM.— 

10 (1) USE OF ALLOWANCES.—Direct Federal sup11 port for the REEP program is provided through the 

12 emission allowances allocated to the States’ SEED 

13 Accounts pursuant to section 132 of this Act. To the 

14 extent that a State provides allowances to local gov15 ernments within the State to implement elements of 

16 the REEP Program, that shall be deemed a dis17 tribution of such allowances to units of local govern18 ment pursuant to subsection (c)(1) of that section. 

19 (2) INITIAL AWARD LIMITS.—Except as pro20 vided in paragraph (3), State and local REEP pro21 grams may make per-building direct expenditures 

22 for retrofit improvements, or their equivalent in indi23 rect or other forms of financial support, from funds 

24 derived from the sale of allowances received directly 


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1 from the Administrator in amounts not to exceed the 

2 following amounts per unit: 

3 (A) RESIDENTIAL BUILDING PROGRAM.— 

4 (i) AWARDS.—For residential build5 ings— 

6 (I) support for a free or low-cost 

7 detailed building energy audit that 

8 prescribes measures sufficient to 

9 achieve at least a 20 percent reduc10 tion in energy use, by providing an in11 centive equal to the documented cost 

12 of such audit, but not more than 

13 $200, in addition to any earned by 

14 achieving a 20 percent or greater effi15 ciency improvement; 

16 (II) a total of $1,000 for a com17 bination of measures, prescribed in an 

18 audit conducted under subclause (I), 

19 designed to reduce energy consump20 tion by more than 10 percent, and 

21 $2,000 for a combination of measures 

22 prescribed in such an audit, designed 

23 to reduce energy consumption by more 

24 than 20 percent; 


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1 (III) $3,000 for demonstrated 

2 savings of 20 percent, pursuant to a 

3 performance-based building retrofit 

4 program; and 

5 (IV) $1,000 for each additional 5 

6 percentage points of energy savings 

7 achieved beyond savings for which 

8 funding is provided under subclause 

9 (II) or (III). 

10 Funding shall not be provided under 

11 clauses (II) and (III) for the same energy 

12 savings. 

13 (ii) MAXIMUM PERCENTAGE.—Awards 

14 under clause (i) shall not exceed 50 per15 cent of retrofit costs for each building. For 

16 buildings with multiple residential units, 

17 awards under clause (i) shall not be great18 er than 50 percent of the total cost of ret19 rofitting the building, prorated among indi20 vidual residential units on the basis of rel21 ative costs of the retrofit. In the case of 

22 public housing and assisted housing, the 

23 50 percent contribution matching the con24 tribution from REEP program funds may 


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1 come from any other source, including 

2 other Federal funds. 

3 (iii) ADDITIONAL AWARDS.—Addi4 tional awards may be provided for pur5 poses of increasing energy efficiency, for 

6 buildings achieving at least 20 percent en7 ergy savings using funding provided under 

8 clause (i), in the form of grants of not 

9 more than $600 for measures projected or 

10 measured (using an appropriate method 

11 approved by the Administrator) to achieve 

12 at least 35 percent potable water savings 

13 through equipment or systems with an es14 timated service life of not less than seven 

15 years, and not more than an additional 

16 $20 may be provided for each additional 

17 one percent of such savings, up to a max18 imum total grant of $1,200. 

19 (B) NONRESIDENTIAL BUILDING PRO20 GRAM.— 

21 (i) AWARDS.—For nonresidential 

22 buildings— 

23 (I) support for a free or low-cost 

24 detailed building energy audit that 

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1 ing measures sufficient to achieve at 

2 least a 20 percent reduction in energy 

3 use, by providing an incentive equal to 

4 the documented cost of such audit, 

5 but not more than $500, in addition 

6 to any award earned by achieving a 

7 20 percent or greater efficiency im8 provement; 

9 (II) $0.15 per square foot of ret10 rofit area for demonstrated energy use 

11 reductions from 20 percent to 30 per12 cent; 

13 (III) $0.75 per square foot for 

14 demonstrated energy use reductions 

15 from 30 percent to 40 percent; 

16 (IV) $1.60 per square foot for 

17 demonstrated energy use reductions 

18 from 40 percent to 50 percent; and 

19 (V) $2.50 per square foot for 

20 demonstrated energy use reductions 

21 exceeding 50 percent. 

22 (ii) MAXIMUM PERCENTAGE.— 

23 Amounts provided under subclauses (II) 

24 through (V) of clause (i) combined shall 

25 not exceed 50 percent of the total retrofit 


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1 cost of a building. In nonresidential build2 ings with multiple units, such awards shall 

3 be prorated among individual units on the 

4 basis of relative costs of the retrofit. 

5 (iii) ADDITIONAL AWARDS.—Addi6 tional awards may be provided, for build7 ings achieving at least 20 percent energy 

8 savings using funding provided under 

9 clause (i), as follows: 

10 (I) WATER.—For purposes of in11 creasing energy efficiency, grants may 

12 be made for whole building potable 

13 water use reduction (using an appro14 priate method approved by the Ad15 ministrator) for up to 50 percent of 

16 the total retrofit cost, including 

17 amounts up to— 

18 (aa) $24.00 per thousand 

19 gallons per year of potable water 

20 savings of 40 percent or more; 

21 (bb) $27.00 per thousand 

22 gallons per year of potable water 

23 savings of 50 percent or more; 

24 and 


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1 (cc) $30.00 per thousand 

2 gallons per year of potable water 

3 savings of 60 percent or more. 

4 (II) ENVIRONMENTAL IMPROVE5 MENTS.—Additional awards of up to 

6 $1,000 may be granted for the inclu7 sion of other environmental attributes 

8 that the Administrator, in consulta9 tion with the Secretary, identifies as 

10 contributing to energy efficiency. Such 

11 attributes may include, but are not 

12 limited to waste diversion and the use 

13 of environmentally preferable mate14 rials (including salvaged, renewable, 

15 or recycled materials, and materials 

16 with no or low-VOC content). The Ad17 ministrator may recommend that 

18 States develop such standards as are 

19 necessary to account for local or re20 gional conditions that may affect the 

21 feasibility or availability of identified 

22 resources and attributes. 

23 (iv) INDOOR AIR QUALITY MINIMUM.— 

24 Nonresidential buildings receiving incen25 tives under this section must satisfy at a 


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1 minimum the most recent version of 

2 ASHRAE Standard 62.1 for ventilation, or 

3 the equivalent as determined by the Ad4 ministrator. A State may issue a waiver 

5 from this requirement to a building project 

6 on a showing that such compliance is in7 feasible due to the physical constraints of 

8 the building’s existing ventilation system, 

9 or such other limitations as may be speci10 fied by the Administrator. 

11 (C) HISTORIC BUILDINGS.—Notwith12 standing subparagraphs (A) and (B), a building 

13 in or eligible for the National Register of His14 toric Places shall be eligible for awards under 

15 this paragraph in amounts up to 120 percent of 

16 the amounts set forth in subparagraphs (A) and 

17 (B). 

18 (D) SUPPLEMENTAL SUPPORT.—State and 

19 local governments may supplement the per20 building expenditures under this paragraph 

21 with funding from other sources. 

22 (3) ADJUSTMENT.—The Administrator may ad23 just the specific dollar limits funded by the sale of 

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1 ment of this Act, and every 2 years thereafter, as 

2 the Administrator determines necessary to achieve 

3 optimum cost-effectiveness and to maximize incen4 tives to achieve energy efficiency within the total 

5 building award amounts provided in that paragraph, 

6 and shall publish and hold constant such revised lim7 its for at least 2 years. The Administrator, in con8 sultation with the Secretary of Housing and Urban 

9 Development, may establish different dollar limits 

10 for public housing and assisted housing than for 

11 other residential buildings. 

12 (j) REPORT TO CONGRESS.—The Administrator shall 

13 conduct an annual assessment of the achievements of the 

14 REEP program in each State, shall prepare an annual re15 port of such achievements and any recommendations for 

16 program modifications, and shall provide such report to 

17 Congress at the end of each fiscal year during which fund18 ing or other resources were made available to the States 

19 for the REEP Program. 

20 (k) OTHER SOURCES OF FEDERAL SUPPORT.— 

21 (1) ADDITIONAL STATE ENERGY PROGRAM

22 FUNDS.—Any Federal funding provided to a State 

23 Energy Program that is not required to be expended 

24 for a different federally designated purpose may be 

25 used to support a REEP program. 


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1 (2) PROGRAM ADMINISTRATION.—State Energy 

2 Offices or designated State agencies may expend up 

3 to 10 percent of available allowance value provided 

4 under this section for program administration. 

5 (3) AUTHORIZATION OF APPROPRIATIONS.— 

6 There are authorized to be appropriated for the pur7 poses of this section, for each of fiscal years 2010, 

8 2011, 2012, and 2013— 

9 (A) $50,000,000 to the Administrator for 

10 program administration costs; and 

11 (B) $20,000,000 to the Secretary of En12 ergy for program administration costs. 

13 SEC. 203. ENERGY EFFICIENT MANUFACTURED HOMES. 

14 (a) DEFINITIONS.—In this section: 

15 (1) MANUFACTURED HOME.—The term ‘‘manu16 factured home’’ has the meaning given such term in 

17 section 603 of the National Manufactured Housing 

18 Construction and Safety Standards Act of 1974 (42 

19 U.S.C. 5402). 

20 (2) ENERGY STAR QUALIFIED MANUFACTURED

21 HOME.—The term ‘‘Energy Star qualified manufac22 tured home’’ means a manufactured home that has 

23 been designed, produced, and installed in accordance 

24 with Energy Star’s guidelines by an Energy Star 

25 certified plant. 


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1 (b) PURPOSE.—The purpose of this section is to as2 sist low-income households residing in manufactured 

3 homes constructed prior to 1976 to save energy and en4 ergy expenditures by providing support toward the pur5 chase of new Energy Star qualified manufactured homes. 

6 (c) STATE IMPLEMENTATION OF PROGRAM.— 

7 (1) MANUFACTURED HOME REPLACEMENT PRO8 GRAM.—Any State may provide to the owner of a 

9 manufactured home constructed prior to 1976 a re10 bate to use toward the purchase of a new Energy 

11 Star qualified manufactured home pursuant to this 

12 section. 

13 (2) USE OF ALLOWANCES.—Direct Federal sup14 port for the program established in this section is 

15 provided through the emission allowances allocated 

16 to the States’ SEED Accounts pursuant to section 

17 132 of this Act. To the extent that a State provides 

18 allowances to local governments within the State to 

19 implement this program, that shall be deemed a dis20 tribution of such allowances to units of local govern21 ment pursuant to subsection (c)(1) of that section. 

22 (3) REBATES.— 

23 (A) PRIMARY RESIDENCE REQUIRE24 MENT.—A rebate described under paragraph 

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1 factured home constructed prior to 1976 that is 

2 used on a year-round basis as a primary resi3 dence. 

4 (B) DISMANTLING AND REPLACEMENT.—A 

5 rebate described under paragraph (1) may be 

6 made only if the manufactured home con7 structed prior to 1976 will be— 

8 (i) rendered unusable for human habi9 tation (including appropriate recycling); 

10 and 

11 (ii) replaced, in the same general loca12 tion, as determined by the applicable State 

13 agency, with an Energy Star qualified 

14 manufactured home. 

15 (C) SINGLE REBATE.—A rebate described 

16 under paragraph (1) may not be provided to 

17 any owner of a manufactured home constructed 

18 prior to 1976 that was or is a member of a 

19 household for which any other member of the 

20 household was provided a rebate pursuant to 

21 this section. 

22 (D) ELIGIBLE HOUSEHOLDS.—To be eligi23 ble to receive a rebate described under para24 graph (1), an owner of a manufactured home 

25 constructed prior to 1976 shall demonstrate to 


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1 the applicable State agency that the total in2 come of all members the owner’s household does 

3 not exceed 200 percent of the Federal poverty 

4 level for income in the applicable area. 

5 (E) ADVANCE AVAILABILITY.—A rebate 

6 may be provided under this section in a manner 

7 to facilitate the purchase of a new Energy Star 

8 qualified manufactured home. 

9 (4) REBATE LIMITATION.—Rebates provided by 

10 States under this section shall not exceed $7,500 per 

11 manufactured home from any value derived from the 

12 use of emission allowances provided to the State 

13 pursuant to section 132. 

14 (5) USE OF STATE FUNDS.—A State providing 

15 rebates under this section may supplement the 

16 amount of such rebates under paragraph (4) by any 

17 additional amount is from State funds and other 

18 sources, including private donations or grants from 

19 charitable organizations. 

20 (6) COORDINATION WITH SIMILAR PRO21 GRAMS.— 

22 (A) STATE PROGRAMS.—A State con23 ducting an existing program that has the pur24 pose of replacing manufactured homes con25 structed prior to 1976 with Energy Star qualiVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00349 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 fied manufactured homes, may use allowance 

2 value provided under section 782 of the Clean 

3 Air Act to support such a program, provided 

4 such funding does not exceed the rebate limita5 tion amount under paragraph (4). 

6 (B) FEDERAL PROGRAMS.—The Secretary 

7 of Energy shall coordinate with and seek to 

8 achieve the purpose of this section through 

9 similar Federal programs including— 

10 (i) the Weatherization Assistance Pro11 gram under part A of title IV of the En12 ergy Conservation and Production Act (42 

13 U.S.C. 6861 et seq.); and 

14 (ii) the program under part D of title 

15 III of the Energy Policy and Conservation 

16 Act (42 U.S.C. 6321 et seq.). 

17 (C) COORDINATION WITH OTHER STATE

18 AGENCIES.—A State agency using allowance 

19 value to administer the program under this sec20 tion may coordinate its efforts, and share funds 

21 for administration, with other State agencies in22 volved in low-income housing programs. 

23 (7) ADMINISTRATIVE EXPENSES.—A State 

24 using allowance value under this section may expend 


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1 not more than 10 percent of such value for adminis2 trative expenses related to this program. 

3 SEC. 204. BUILDING ENERGY PERFORMANCE LABELING 

4 PROGRAM. 

5 (a) ESTABLISHMENT.— 

6 (1) PURPOSE.—The Administrator shall estab7 lish a building energy performance labeling program 

8 with broad applicability to the residential and com9 mercial markets to enable and encourage knowledge 

10 about building energy performance by owners and 

11 occupants and to inform efforts to reduce energy 

12 consumption nationwide. 

13 (2) COMPONENTS.—In developing such pro14 gram, the Administrator shall— 

15 (A) consider existing programs, such as 

16 Environmental Protection Agency’s Energy 

17 Star program, the Home Energy Rating System 

18 (HERS) Index, and programs at the Depart19 ment of Energy; 

20 (B) support the development of model per21 formance labels for residential and commercial 

22 buildings; and 

23 (C) utilize incentives and other means to 

24 spur use of energy performance labeling of pub25 lic and private sector buildings nationwide. 


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1 (b) DATA ASSESSMENT FOR BUILDING ENERGY PER2 FORMANCE.— 

3 (1) INITIAL REPORT.—Not later than 90 days 

4 after the date of enactment of this Act, the Adminis5 trator shall provide to Congress, as well as to the 

6 Secretary of Energy and the Office of Management 

7 and Budget, a report identifying— 

8 (A) all principal building types for which 

9 statistically significant energy performance data 

10 exists to serve as the basis of measurement pro11 tocols and labeling requirements for achieved 

12 building energy performance; and 

13 (B) those building types for which addi14 tional data are required to enable the develop15 ment of such protocols and requirements. 

16 (2) ADDITIONAL REPORTS.—Additional updated 

17 reports shall be provided under this subsection as 

18 often as The Administrator considers practicable, 

19 but not less than every 2 years. 

20 (c) BUILDING DATA ACQUISITION.— 

21 (1) RESOURCE REQUIREMENTS.—For all prin22 cipal building types identified under subsection (b), 

23 the Secretary of Energy, not later than 90 days 

24 after a report by the Administrator under subsection 

25 (b), shall provide to Congress, the Administrator, 


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1 and the Office of Management and Budget a state2 ment of additional resources needed, if any, to fully 

3 develop the relevant data, as well as the anticipated 

4 timeline for data development. 

5 (2) CONSULTATION.—The Secretary of Energy 

6 shall consult with the Administrator concerning the 

7 Administrator’s ability to use data series for these 

8 additional building types to support the achieved 

9 performance component in the labeling program. 

10 (3) IMPROVEMENTS TO BUILDING ENERGY CON11 SUMPTION DATABASES.— 

12 (A) COMMERCIAL DATABASE.—The Sec13 retary of Energy shall support improvements to 

14 the Commercial Buildings Energy Consumption 

15 Survey (CBECS) as authorized by section 

16 205(k) of the Department of Energy Organiza17 tion Act (42 U.S.C. 7135(k))— 

18 (i) to enable complete and robust data 

19 for the actual energy performance of prin20 cipal building types currently covered by 

21 survey; 

22 (ii) to cover additional building types 

23 as identified by the Administrator under 

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1 ment protocols are developed for at least 

2 90 percent of all major commercial build3 ing types within 5 years after the date of 

4 enactment of this Act; and 

5 (iii) to include third-party audits of 

6 random data samplings to ensure the qual7 ity and accuracy of survey information. 

8 (B) RESIDENTIAL DATABASES.—The Ad9 ministrator, in consultation with the Energy In10 formation Administration and the Secretary of 

11 Energy, shall support improvements to the Res12 idential Energy Consumption Survey (RECS) 

13 as authorized by section 205(k) of the Depart14 ment of Energy Organization Act (42 U.S.C. 

15 7135(k)), or such other residential energy per16 formance databases as the Administrator con17 siders appropriate, to aid the development of 

18 achieved performance measurement protocols 

19 for residential building energy use for at least 

20 90 percent of the residential market within 5 

21 years after the date of enactment of this Act. 

22 (C) CONSULTATION.—The Secretary of 

23 Energy and the Administrator shall consult 

24 with public, private, and nonprofit sector rep25 resentatives from the building industry and real 


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1 estate industry to assist in the evaluation and 

2 improvement of building energy performance 

3 databases and labeling programs. 

4 (d) IDENTIFICATION OF MEASUREMENT PROTOCOLS

5 FOR ACHIEVED PERFORMANCE.— 

6 (1) PROPOSED PROTOCOLS AND REQUIRE7 MENTS.—At the earliest practicable date, but not 

8 later than 1 year after identifying a building type 

9 under subsection (b)(1)(A), the Administrator shall 

10 propose a measurement protocol for that building 

11 type and a requirement detailing how to use that 

12 protocol in completing applicable commercial or resi13 dential performance labels created pursuant to this 

14 section. 

15 (2) FINAL RULE.—After providing for notice 

16 and comment, the Administrator shall publish a 

17 final rule containing a measurement protocol and 

18 the corresponding requirements for applying that 

19 protocol. Such a rule— 

20 (A) shall define the minimum period for 

21 measurement of energy use by buildings of that 

22 type and other details for determining achieved 

23 performance, to include leased buildings or 

24 parts thereof; 


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1 (B) shall identify necessary data collection 

2 and record retention requirements; and 

3 (C) may specify transition rules and ex4 emptions for classes of buildings within the 

5 building type. 

6 (e) PROCEDURES FOR EVALUATING DESIGNED PER7 FORMANCE.—The Administrator shall develop protocols 

8 for evaluating the designed performance of individual 

9 building types. The Administrator may conduct such feasi10 bility studies and demonstration projects as are necessary 

11 to evaluate the sufficiency of proposed protocols for de12 signed performance. 

13 (f) CREATION OF BUILDING ENERGY PERFORMANCE

14 LABELING PROGRAM.— 

15 (1) MODEL LABEL.—Not later than 1 year 

16 after the date of enactment of this Act, the Adminis17 trator shall propose a model building energy label 

18 that provides a format— 

19 (A) to display achieved performance and 

20 designed performance data; 

21 (B) that may be tailored for residential 

22 and commercial buildings, and for single-occu23 pancy and multitenanted buildings; and 


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1 (C) to display other appropriate elements 

2 identified during the development of measure3 ment protocols under subsections (d) and (e). 

4 (2) INCLUSIONS.—Nothing in this section shall 

5 require the inclusion on such a label of designed per6 formance data where impracticable or not cost effec7 tive, or to preclude the display of both achieved per8 formance and designed performance data for a par9 ticular building where both such measures are avail10 able, practicable, and cost effective. 

11 (3) EXISTING PROGRAMS.—In developing the 

12 model label, the Administrator shall consider exist13 ing programs, including— 

14 (A) the Environmental Protection Agency’s 

15 Energy Star Portfolio Manager program and 

16 the California HERS II Program Custom Ap17 proach for the achieved performance component 

18 of the label; 

19 (B) the Home Energy Rating System 

20 (HERS) Index system for the designed per21 formance component of the label; and 

22 (C) other Federal and State programs, in23 cluding the Department of Energy’s related 

24 programs on building technologies and those of 

25 the Federal Energy Management Program. 


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1 (4) FINAL RULE.—After providing for notice 

2 and comment, the Administrator shall publish a 

3 final rule containing the label applicable to covered 

4 building types. 

5 (g) DEMONSTRATION PROJECTS FOR LABELING

6 PROGRAM.— 

7 (1) IN GENERAL.—The Administrator shall con8 duct building energy performance labeling dem9 onstration projects for different building types— 

10 (A) to ensure the sufficiency of the current 

11 Commercial Buildings Energy Consumption 

12 Survey and other data to serve as the basis for 

13 new measurement protocols for the achieved 

14 performance component of the building energy 

15 performance labeling program; 

16 (B) to inform the development of measure17 ment protocols for building types not currently 

18 covered by the Commercial Buildings Energy 

19 Consumption Survey; and 

20 (C) to identify any additional information 

21 that needs to be developed to ensure effective 

22 use of the model label. 

23 (2) PARTICIPATION.—Such demonstration 

24 projects shall include participation of— 


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1 (A) buildings from diverse geographical 

2 and climate regions; 

3 (B) buildings in both urban and rural 

4 areas; 

5 (C) single-family residential buildings; 

6 (D) multihousing residential buildings with 

7 more than 50 units, including at least one 

8 project that provides affordable housing to indi9 viduals of diverse incomes; 

10 (E) single-occupant commercial buildings 

11 larger than 30,000 square feet; 

12 (F) multitenanted commercial buildings 

13 larger than 50,000 square feet; and 

14 (G) buildings from both the public and pri15 vate sectors. 

16 (3) PRIORITY.—Priority in the selection of dem17 onstration projects shall be given to projects that fa18 cilitate large-scale implementation of the labeling 

19 program for samples of buildings across neighbor20 hoods, geographic regions, cities, or States. 

21 (4) FINDINGS.—The Administrator shall report 

22 any findings from demonstration projects under this 

23 subsection, including an identification of any areas 

24 of needed data improvement, to the Department of 


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1 Energy’s Energy Information Administration and 

2 Building Technologies Program. 

3 (5) COORDINATION.—The Administrator and 

4 the Secretary of Energy shall coordinate demonstra5 tion projects undertaken pursuant to this subsection 

6 with those undertaken as part of the Zero-Net-En7 ergy Commercial Buildings Initiative adopted under 

8 section 422 of the Energy Independence and Secu9 rity Act of 2007 (42 U.S.C. 17082). 

10 (h) IMPLEMENTATION OF LABELING PROGRAM.— 

11 (1) IN GENERAL.—The Administrator, in con12 sultation with the Secretary of Energy, shall work 

13 with all State Energy Offices established pursuant 

14 to part D of title III of the Energy Policy and Con15 servation Act (42 U.S.C. 6321 et seq.) or other 

16 State authorities as necessary for the purpose of im17 plementing the labeling program established under 

18 this section for commercial and residential buildings. 

19 (2) OUTREACH TO LOCAL AUTHORITIES.—The 

20 Administrator shall, acting in consultation and co21 ordination with the respective States, encourage use 

22 of the labeling program by counties and other local23 ities to broaden access to information about building 

24 energy use, for example, through disclosure of build25 ing label contents in tax, title, and other records 


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1 those localities maintain. For this purpose, the Ad2 ministrator shall develop an electronic version of the 

3 label and information that can be readily trans4 mitted and read in widely-available computer pro5 grams but is protected from unauthorized manipula6 tion. 

7 (3) MEANS OF IMPLEMENTATION.—In adopting 

8 the model labeling program established under this 

9 section, a State shall seek to ensure that labeled in10 formation be made accessible to the public in a man11 ner so that owners, lenders, tenants, occupants, or 

12 other relevant parties can utilize it. Such accessi13 bility may be accomplished through— 

14 (A) preparation, and public disclosure of 

15 the label through filing with tax and title 

16 records at the time of— 

17 (i) a building audit conducted with 

18 support from Federal or State funds; 

19 (ii) a building energy-efficiency ret20 rofit conducted in response to such an 

21 audit; 

22 (iii) a final inspection of major ren23 ovations or additions made to a building in 

24 accordance with a building permit issued 

25 by a local government entity; 


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1 (iv) a sale that is recorded for title 

2 and tax purposes consistent with para3 graph (8); 

4 (v) a new lien recorded on the prop5 erty for more than a set percentage of the 

6 assessed value of the property, if that lien 

7 reflects public financial assistance for en8 ergy-related improvements to that building; 

9 or 

10 (vi) a change in ownership or oper11 ation of the building for purposes of utility 

12 billing; or 

13 (B) other appropriate means. 

14 (4) STATE IMPLEMENTATION OF PROGRAM.— 

15 (A) ELIGIBILITY.—A State may become el16 igible to utilize allowance value to implement 

17 this program by— 

18 (i) adopting by statute or regulation a 

19 requirement that buildings be assessed and 

20 labeled, consistent with the labeling re21 quirements of the program established 

22 under this section; or 

23 (ii) adopting a plan to implement a 

24 model labeling program consistent with 

25 this section within one year of enactment 


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1 of this Act, including the establishment of 

2 that program within 3 years after the date 

3 of enactment of this Act, and dem4 onstrating continuous progress under that 

5 plan. 

6 (B) USE OF ALLOWANCES.—Direct Fed7 eral support for the program established in this 

8 section is provided through the emission allow9 ances allocated to the States’ SEED Accounts 

10 pursuant to section 132 of this Act. To the ex11 tent that a State provides allowances to local 

12 governments within the State to implement this 

13 program, that shall be deemed a distribution of 

14 such allowances to units of local government 

15 pursuant to subsection (c)(1) of that section. 

16 (5) GUIDANCE.—The Administrator may create 

17 or identify model programs and resources to provide 

18 guidance to offer to States and localities for creating 

19 labeling programs consistent with the model pro20 gram established under this section. 

21 (6) PROGRESS REPORT.—The Administrator, in 

22 consultation with the Secretary of Energy, shall pro23 vide a progress report to Congress not later than 3 

24 years after the date of enactment of this Act that— 


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1 (A) evaluates the effectiveness of efforts to 

2 advance use of the model labeling program by 

3 States and localities; 

4 (B) recommends any legislative changes 

5 necessary to broaden the use of the model label6 ing program; and 

7 (C) identifies any changes to broaden the 

8 use of the model labeling program that the Ad9 ministrator has made or intends to make that 

10 do not require additional legislative authority. 

11 (7) STATE INFORMATION.—The Administrator 

12 may require States to report to the Administrator 

13 information that the Administrator requires to pro14 vide the report required under paragraph (6). 

15 (8) PREVENTION OF DISRUPTION OF SALES

16 TRANSACTIONS.—No State shall implement a new 

17 labeling program pursuant to this section in a man18 ner that requires the labeling of a building to occur 

19 after a contract has been executed for the sale of 

20 that building and before the sales transaction is 

21 completed. 

22 (i) IMPLEMENTATION OF LABELING PROGRAM IN

23 FEDERAL BUILDINGS.— 

24 (1) USE OF LABELING PROGRAM.—The Sec25 retary of Energy and the Administrator shall use the 


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1 labeling program established under this section to 

2 evaluate energy performance in the facilities of the 

3 Department of Energy and the Environmental Pro4 tection Agency, respectively, to the extent prac5 ticable, and shall encourage and support implemen6 tation efforts in other Federal agencies. 

7 (2) ANNUAL PROGRESS REPORT.—The Sec8 retary of Energy and Administrator shall provide an 

9 annual progress report to Congress and the Office of 

10 Management and Budget detailing efforts to imple11 ment this subsection, as well as any best practices 

12 or needed resources identified as a result of such ef13 forts. 

14 (j) PUBLIC OUTREACH.—The Secretary of Energy 

15 and the Administrator, in consultation with nonprofit and 

16 industry stakeholders with specialized expertise, and in 

17 conjunction with other energy efficiency public awareness 

18 efforts, shall establish a business and consumer education 

19 program to increase awareness about the importance of 

20 building energy efficiency and to facilitate widespread use 

21 of the labeling program established under this section. 

22 (k) DEFINITIONS.—In this section: 

23 (1) BUILDING TYPE.—The term ‘‘building 

24 type’’ means a grouping of buildings as identified by 

25 their principal building activities, or as grouped by 


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1 their use, including office buildings, laboratories, li2 braries, data centers, retail establishments, hotels, 

3 warehouses, and educational buildings. 

4 (2) MEASUREMENT PROTOCOL.—The term 

5 ‘‘measurement protocol’’ means the methodology, 

6 prescribed by the Administrator, for defining a 

7 benchmark for building energy performance for a 

8 specific building type and for measuring that per9 formance against the benchmark. 

10 (3) ACHIEVED PERFORMANCE.—The term 

11 ‘‘achieved performance’’ means the actual energy 

12 consumption of a building as compared to a baseline 

13 building of the same type and size, determined by 

14 actual consumption data normalized for appropriate 

15 variables. 

16 (4) DESIGNED PERFORMANCE.—The term ‘‘de17 signed performance’’ means the energy consumption 

18 performance a building would achieve if operated 

19 consistent with its design intent for building energy 

20 use, utilizing a standardized set of operational condi21 tions informed by data collected or confirmed during 

22 an energy audit. 

23 (l) AUTHORIZATION OF APPROPRIATIONS.—There 

24 are authorized to be appropriated— 


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1 (1) to the Administrator $50,000,000 for imple2 mentation of this section for each fiscal year from 

3 2010 through 2020; and 

4 (2) to the Secretary of Energy $20,000,000 for 

5 implementation of this section for fiscal year 2010 

6 and $10,000,000 for fiscal years 2011 through 

7 2020. 

8 SEC. 205. TREE PLANTING PROGRAMS. 

9 (a) FINDINGS.—The Congress finds that— 

10 (1) the utility sector is the largest single source 

11 of greenhouse gas emissions in the United States 

12 today, producing approximately one-third of the 

13 country’s emissions; 

14 (2) heating and cooling homes accounts for 

15 nearly 60 percent of residential electricity usage in 

16 the United States; 

17 (3) shade trees planted in strategic locations 

18 can reduce residential cooling costs by as much as 

19 30 percent; 

20 (4) shade trees have significant clean-air bene21 fits associated with them; 

22 (5) every 100 healthy large trees removes about 

23 300 pounds of air pollution (including particulate 

24 matter and ozone) and about 15 tons of carbon diox25 ide from the air each year; 


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1 (6) tree cover on private property and on newly2 developed land has declined since the 1970s, even 

3 while emissions from transportation and industry 

4 have been rising; and 

5 (7) in over a dozen test cities across the United 

6 States, increasing urban tree cover has generated 

7 between two and five dollars in savings for every dol8 lar invested in such tree planting. 

9 (b) DEFINITIONS.—As used in this section: 

10 (1) The term ‘‘Secretary’’ refers to the Sec11 retary of Energy. 

12 (2) The term ‘‘retail power provider’’ means 

13 any entity authorized under applicable State or Fed14 eral law to generate, distribute, or provide retail 

15 electricity, natural gas, or fuel oil service. 

16 (3) The term ‘‘tree-planting organization’’ 

17 means any nonprofit or not-for-profit group which 

18 exists, in whole or in part, to— 

19 (A) expand urban and residential tree 

20 cover; 

21 (B) distribute trees for planting; 

22 (C) increase awareness of the environ23 mental and energy-related benefits of trees; 

24 (D) educate the public about proper tree 

25 planting, care, and maintenance strategies; or 


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1 (E) carry out any combination of the fore2 going activities. 

3 (4) The term ‘‘tree-siting guidelines’’ means a 

4 comprehensive list of science-based measurements 

5 outlining the species and minimum distance required 

6 between trees planted pursuant to this section, in 

7 addition to the minimum required distance to be 

8 maintained between such trees and— 

9 (A) building foundations; 

10 (B) air conditioning units; 

11 (C) driveways and walkways; 

12 (D) property fences; 

13 (E) preexisting utility infrastructure; 

14 (F) septic systems; 

15 (G) swimming pools; and 

16 (H) other infrastructure as deemed appro17 priate. 

18 (5) The terms ‘‘small office’’, ‘‘small office 

19 buildings’’, and ‘‘small office settings’’ means non20 residential buildings or structures zoned for business 

21 purposes that are 20,000 square feet or less in total 

22 area. 

23 (c) PURPOSES.—The purpose of this section is to es24 tablish a grant program to assist retail power providers 

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1 planting programs in residential and small office settings, 

2 for the following purposes: 

3 (1) Reducing the peak-load demand for elec4 tricity from residences and small office buildings 

5 during the summer months through direct shading 

6 of buildings provided by strategically planted trees. 

7 (2) Reducing wintertime demand for energy 

8 from residences and small office buildings by block9 ing cold winds from reaching such structures, which 

10 lowers interior temperatures and drives heating de11 mand. 

12 (3) Protecting public health by removing harm13 ful pollution from the air. 

14 (4) Utilizing the natural photosynthetic and 

15 transpiration process of trees to lower ambient tem16 peratures and absorb carbon dioxide, thus mitigating 

17 the effects of climate change. 

18 (5) Lowering electric bills for residential and 

19 small office ratepayers by limiting electricity con20 sumption without reducing benefits. 

21 (6) Relieving financial and demand pressure on 

22 retail power providers that stems from large peak23 load energy demand. 


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1 (7) Protecting water quality and public health 

2 by reducing stormwater runoff and keeping harmful 

3 pollutants from entering waterways. 

4 (8) Ensuring that trees are planted in locations 

5 that limit the amount of public money needed to 

6 maintain public and electric infrastructure. 

7 (d) GENERAL AUTHORITY.— 

8 (1) ASSISTANCE.—The Secretary is authorized 

9 to provide financial, technical, and related assistance 

10 to retail power providers to assist with the establish11 ment of new, or continued operation of existing, tar12 geted tree-planting programs for residences and 

13 small office buildings. 

14 (2) PUBLIC RECOGNITION INITIATIVE.—In car15 rying out the authority provided under this section, 

16 the Secretary shall also create a national public rec17 ognition initiative to encourage participation in tree18 planting programs by retail power providers. 

19 (3) ELIGIBILITY.—Only those programs which 

20 utilize targeted, strategic tree-siting guidelines to 

21 plant trees in relation to building location, sunlight, 

22 and prevailing wind direction shall be eligible for as23 sistance under this section. 


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1 (4) REQUIREMENTS.—In order to qualify for 

2 assistance under this section, a tree-planting pro3 gram shall meet each of the following requirements: 

4 (A) The program shall provide free or dis5 counted shade-providing or wind-reducing trees 

6 to residential and small office consumers inter7 ested in lowering their home energy costs. 

8 (B) The program shall optimize the elec9 tricity-consumption reduction benefit of each 

10 tree by planting in strategic locations around a 

11 given residence or small office. 

12 (C) The program shall either— 

13 (i) provide maximum amounts of 

14 shade during summer intervals when resi15 dences and small offices are exposed to the 

16 most sun intensity; or 

17 (ii) provide maximum amounts of 

18 wind protection during fall and winter in19 tervals when residences and small offices 

20 are exposed to the most wind intensity. 

21 (D) The program shall use the best avail22 able science to create tree siting guidelines 

23 which dictate where the optimum tree species 

24 are best planted in locations that achieve max25 imum reductions in consumer energy demand 


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1 while causing the least disruption to public in2 frastructure, considering overhead and under3 ground facilities. 

4 (E) The program shall receive certification 

5 from the Secretary that it is designed to achieve 

6 the goals set forth in subparagraphs (A) 

7 through (D). In designating criteria for such 

8 certification, the Secretary shall collaborate 

9 with the United States Forest Service’s Urban 

10 and Community Forestry Program to ensure 

11 that certification requirements are consistent 

12 with such above goals. 

13 (5) NEW PROGRAM FUNDING SHARE.—The Sec14 retary shall ensure that no less than 30 percent of 

15 the funds made available under this section are dis16 tributed to retail power providers which— 

17 (A) have not previously established or op18 erated qualified tree-planting programs; or 

19 (B) are operating qualified tree-planting 

20 programs which were established no more than 

21 three years prior to the date of enactment of 

22 this section. 

23 (e) AGREEMENTS BETWEEN ELECTRICITY PRO24 VIDERS AND TREE-PLANTING ORGANIZATIONS.— 


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1 (1) GRANT AUTHORIZATION.—In providing as2 sistance under this section, the Secretary is author3 ized to award grants only to retail power providers 

4 that have entered into binding legal agreements with 

5 nonprofit tree-planting organizations. 

6 (2) CONDITIONS OF AGREEMENT.—Those 

7 agreements between retail power providers and tree8 planting organizations shall set forth conditions 

9 under which nonprofit tree-planting organizations 

10 shall provide targeted tree-planting programs which 

11 may require these organizations to— 

12 (A) participate in local technical advisory 

13 committees responsible for drafting general 

14 tree-siting guidelines and choosing the most ef15 fective species of trees to plant in given loca16 tions; 

17 (B) coordinate volunteer recruitment to as18 sist with the physical act of planting trees in 

19 residential locations; 

20 (C) undertake public awareness campaigns 

21 to educate local residents about the benefits, 

22 cost savings, and availability of free shade 

23 trees; 


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1 (D) establish education and information 

2 campaigns to encourage recipients to maintain 

3 their shade trees over the long term; 

4 (E) serve as the point of contact for exist5 ing and potential residential participants who 

6 have questions or concerns regarding the tree7 planting program; 

8 (F) require tree recipients to sign agree9 ments committing to voluntary stewardship and 

10 care of provided trees; 

11 (G) monitor and report on the survival, 

12 growth, overall health, and estimated energy 

13 savings of provided trees up until the end of 

14 their establishment period which shall be no 

15 less than five years; and 

16 (H) ensure that trees planted near existing 

17 power lines will not interfere with energized 

18 electricity distribution lines when mature, and 

19 that no new trees will be planted under or adja20 cent to high-voltage electric transmission lines 

21 without prior consultation with the applicable 

22 retail power provider receiving assistance under 

23 this section. 

24 (3) LACK OF NONPROFIT ORGANIZATION.—If 

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1 ganizations do not exist or operate within areas 

2 served by retail power providers applying for assist3 ance under this section, the requirements of this sec4 tion shall apply to binding legal agreements entered 

5 into by such retail power providers and one of the 

6 following entities: 

7 (A) Local municipal governments with ju8 risdiction over the urban or suburban forest. 

9 (B) The State Forester for the State in 

10 which the tree planting program will operate. 

11 (C) The United States Forest Service’s 

12 Urban and Community Forestry representative 

13 for the State in which the tree-planting pro14 gram will operate. 

15 (D) A landscaping services company that 

16 is— 

17 (i) identified in consultation with a 

18 national or State nonprofit or not-for-prof19 it tree-planting organization; 

20 (ii) licensed to operate in the State in 

21 which the tree-planting program will oper22 ate; and 

23 (iii) a business as defined by the 

24 United States Census Bureau’s 2007 


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1 North American Industry Classification 

2 System Code 561730. 

3 (f) TECHNICAL ADVISORY COMMITTEES.— 

4 (1) DESCRIPTION.—In order to qualify for as5 sistance under this section, the retail power provider 

6 shall establish and consult with a local technical ad7 visory committee which shall provide advice and con8 sultation to the program, and may— 

9 (A) design and adopt an approved plant 

10 list that emphasizes the use of hardy, 

11 noninvasive tree species and, where geographi12 cally appropriate, the use of native, or site13 adapted, or low water-use shade trees; 

14 (B) design and adopt planting, installation, 

15 and maintenance specifications and create a 

16 process for inspection and quality control; 

17 (C) ensure that tree recipients are edu18 cated to care for and maintain their trees over 

19 the long term; 

20 (D) help the public become more engaged 

21 and educated in the planting and care of shade 

22 trees; 

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1 erence to areas where the average annual in2 come is below the regional median; and 

3 (F) assist with monitoring and collection of 

4 data on tree health, tree survival, and energy 

5 conservation benefits generated under this sec6 tion. 

7 (2) COMPENSATION.—Individuals serving on 

8 local technical advisory committees shall not receive 

9 compensation for their service. 

10 (3) COMPOSITION.—Local technical advisory 

11 committees shall be composed of representatives 

12 from public, private, and nongovernmental agencies 

13 with expertise in demand-side energy efficiency man14 agement, urban forestry, or arboriculture, and shall 

15 be composed of the following: 

16 (A) Up to 4 persons, but no less than one 

17 person, representing the retail power provider 

18 receiving assistance under this section. 

19 (B) Up to 4 persons, but no less than one 

20 person, representing the local tree-planting or21 ganization which will partner with the retail 

22 power provider to carry out this section. 

23 (C) Up to 3 persons representing local 

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1 ties which are organized under section 

2 501(c)(3) of the Internal Revenue Code of 

3 1986, and which have demonstrated expertise 

4 engaging the public in energy conservation, en5 ergy efficiency, or green building practices or a 

6 combination thereof, such that no single organi7 zation is represented by more than one indi8 vidual under this paragraph. 

9 (D) Up to 2 persons representing a local 

10 affordable housing agency, affordable housing 

11 builder, or community development corporation. 

12 (E) Up to 3, but no less than one, persons 

13 representing local city or county government for 

14 each municipality where a shade tree-planting 

15 program will take place; at least one of these 

16 representatives shall be the city or county for17 ester, city or county arborist, or functional 

18 equivalent. 

19 (F) Up to one person representing the 

20 local government agency responsible for man21 agement of roads, sewers, and infrastructure, 

22 including but not limited to public works de23 partments, transportation agencies, or equiva24 lents. 


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1 (G) Up to 3 persons representing the nurs2 ery and landscaping industry. 

3 (H) Up to 3 persons representing the re4 search community or academia with expertise in 

5 natural resources or energy management issues. 

6 (4) CHAIRPERSON.—Each local technical advi7 sory committee shall elect a chairperson to preside 

8 over Committee meetings, act as a liaison to govern9 mental and other outside entities, and direct the 

10 general operation of the committee; only committee 

11 representatives from paragraph (3)(A) or paragraph 

12 (3)(B) of this subsection shall be eligible to act as 

13 local technical advisory committee chairpersons. 

14 (5) CREDENTIALS.—At least one of the mem15 bers of each local technical advisory committee shall 

16 be certified with one or more of the following creden17 tials: International Society of Arboriculture; Cer18 tified Arborist, ISA; Certified Arborist Municipal 

19 Specialist, ISA; Certified Arborist Utility Specialist, 

20 ISA; Board Certified Master Arborist; or Registered 

21 Landscape Architect recommended by the American 

22 Society of Landscape Architects. 

23 (g) COST-SHARE PROGRAM.— 

24 (1) FEDERAL SHARE.—The Federal share of 

25 support for projects funded under this section shall 


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1 not exceed 50 percent of the cost of such project and 

2 shall be provided on a matching basis. 

3 (2) NON-FEDERAL SHARE.—The non-Federal 

4 share of such costs may be paid or contributed by 

5 any governmental or nongovernmental entity other 

6 than from funds derived directly or indirectly from 

7 an agency or instrumentality of the United States. 

8 (h) RULEMAKING.— 

9 (1) RULEMAKING PERIOD.—The Secretary shall 

10 be authorized to solicit comments and initiate a rule11 making period that shall last no more than 6 

12 months after the date of enactment of this section. 

13 (2) COMPETITIVE GRANT RULE.—At the conclu14 sion of the rulemaking period under paragraph (1), 

15 the Secretary shall promulgate a rule governing a 

16 public, competitive grants process through which re17 tail power providers may apply for Federal support 

18 under this section. 

19 (i) NONDUPLICITY.—Nothing in this section shall be 

20 construed to supersede, duplicate, cancel, or negate the 

21 programs or authorities provided under section 9 of the 

22 Cooperative Forestry Assistance Act of 1978 (92 Stat. 

23 369; Public Law 95–313; 16 U.S.C. 2105). 


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1 (j) AUTHORIZATION OF APPROPRIATIONS.—There 

2 are hereby authorized to be appropriated such sums as 

3 may be necessary for the implementation of this section. 

4 SEC. 206. ENERGY EFFICIENCY FOR DATA CENTER BUILD5 INGS. 

6 Section 453(c)(1) of the Energy Independence and 

7 Security Act of 2007 (42 U.S.C. 17112(c)(1)) is amended 

8 by inserting ‘‘but not later than 2 years after the date 

9 of enactment of this Act’’ after ‘‘described in subsection 

10 (b)’’. 

11 Subtitle B—Lighting and Appliance 

12 Energy Efficiency Programs 

13 SEC. 211. LIGHTING EFFICIENCY STANDARDS. 

14 (a) OUTDOOR LIGHTING.— 

15 (1) DEFINITIONS.— 

16 (A) Section 340(1) of the Energy Policy 

17 and Conservation Act (42 U.S.C. 6311(1)) is 

18 amended by striking subparagraph (L) and in19 serting the following: 

20 ‘‘(L) Outdoor luminaires. 

21 ‘‘(M) Outdoor high light output lamps. 

22 ‘‘(N) Any other type of industrial equip23 ment which the Secretary classifies as covered 

24 equipment under section 341(b).’’. 


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1 (B) Section 340 of the Energy Policy and 

2 Conservation Act (42 U.S.C. 6311) is amended 

3 as adding at the end the following: 

4 ‘‘(25) The term ‘luminaire’ means a complete 

5 lighting unit consisting of one or more light sources 

6 and ballast(s), together with parts designed to dis7 tribute the light, to position and protect such lamps, 

8 and to connect such light sources to the power sup9 ply. 

10 ‘‘(26) The term ‘outdoor luminaire’ means a lu11 minaire that is listed as suitable for wet locations 

12 pursuant to Underwriters Laboratories Inc. stand13 ard UL 1598 and is labeled as ‘Suitable for Wet Lo14 cations’ consistent with section 410.4(A) of the Na15 tional Electrical Code 2005, or is designed for road16 way illumination and meets the requirements of Ad17 dendum A for IESNA TM-15-07: Backlight, 

18 Uplight, and Glare (BUG) Ratings, except for— 

19 ‘‘(A) luminaires designed for outdoor video 

20 display images that cannot be used in general 

21 lighting applications; 

22 ‘‘(B) portable luminaires designed for use 

23 at construction sites; 


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1 ‘‘(C) luminaires designed for continuous 

2 immersion in swimming pools and other water 

3 features; 

4 ‘‘(D) seasonal luminaires incorporating 

5 solely individual lamps rated at 10 watts or 

6 less; 

7 ‘‘(E) luminaires designed to be used in 

8 emergency conditions that incorporate a means 

9 of charging a battery and a device to switch the 

10 power supply to emergency lighting loads auto11 matically upon failure of the normal power sup12 ply; 

13 ‘‘(F) components used for repair of in14 stalled luminaries and that meet the require15 ments of section 342(h); 

16 ‘‘(G) a luminaire utilizing an electrode-less 

17 fluorescent lamp as the light source; 

18 ‘‘(H) decorative gas lighting systems; 

19 ‘‘(I) luminaires designed explicitly for 

20 lighting for theatrical purposes, including per21 formance, stage, film production, and video pro22 duction; 

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1 not be used in most general lighting applica2 tions; 

3 ‘‘(K) luminaires designed explicitly for ve4 hicular roadway tunnels designed to comply 

5 with ANSI/IESNA RP-22-05; 

6 ‘‘(L) luminaires designed explicitly for haz7 ardous locations meeting UL Standard 844; 

8 ‘‘(M) searchlights; 

9 ‘‘(N) luminaires that are designed to be re10 cessed into a building, and that cannot be used 

11 in most general lighting applications; 

12 ‘‘(O) a luminaire rated only for residential 

13 applications utilizing a light source or sources 

14 regulated under the amendments made by sec15 tion 321 of the Energy Independence and Secu16 rity Act of 2007 and with a light output no 

17 greater than 2,600 lumens; 

18 ‘‘(P) a residential pole-mounted luminaire 

19 that is not rated for commercial use utilizing a 

20 light source or sources meeting the efficiency 

21 requirements of section 231 of the Energy 

22 Independence and Security Act of 2007 and 

23 mounted on a post or pole not taller than 10.5 

24 feet above ground and with a light output not 

25 greater than 2,600 lumens; 


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1 ‘‘(Q) a residential fixture with E12 (Can2 delabra) bases that is rated for not more than 

3 300 watts total; or 

4 ‘‘(R) a residential fixture with medium 

5 screw bases that is rated for not more than 145 

6 watts. 

7 ‘‘(27) The term ‘outdoor high light outputlamp’ 

8 means a lamp that— 

9 ‘‘(A) has a rated lumen output not less 

10 than 2601 lumens; 

11 ‘‘(B) is capable of being operated at a volt12 age not less than 110 volts and not greater 

13 than 300 volts, or driven at a constant current 

14 of 6.6 amperes; 

15 ‘‘(C) is not a Parabolic Aluminized Reflec16 tor lamp; and 

17 ‘‘(D) is not a J-type double-ended (T-3) 

18 halogen quartz lamp, utilizing R-7S bases, that 

19 is manufactured before January 1, 2015. 

20 ‘‘(28) The term ‘outdoor lighting control’ means 

21 a device incorporated in a luminaire that receives a 

22 signal, from either a sensor (such as an occupancy 

23 sensor, motion sensor, or daylight sensor) or an 

24 input signal (including analog or digital signals com25 municated through wired or wireless technology), 


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1 and can adjust the light level according to the sig2 nal.’’. 

3 (2) STANDARDS.— Section 342 of the Energy 

4 Policy and Conservation Act (42 U.S.C. 6313) is 

5 amended by adding at the end the following: 

6 ‘‘(g) OUTDOOR LUMINAIRES.— 

7 ‘‘(1) Each outdoor luminaire manufactured on 

8 or after January 1, 2011, shall— 

9 ‘‘(A) have an initial luminaire efficacy of 

10 at least 50 lumens per watt; and 

11 ‘‘(B) be designed to use a light source with 

12 a lumen maintenance, calculated as mean rated 

13 lumens divided by initial lumens, of at least 0.6. 

14 ‘‘(2) Each outdoor luminaire manufactured on 

15 or after January 1, 2013, shall— 

16 ‘‘(A) have an initial luminaire efficacy of 

17 at least 70 lumens per watt; and 

18 ‘‘(B) be designed to use a light source with 

19 a lumen maintenance, calculated as mean rated 

20 lumens divided by initial lumens, of at least 0.6. 

21 ‘‘(3) Each outdoor luminaire manufactured on 

22 or after January 1, 2015, shall— 

23 ‘‘(A) have an initial luminaire efficacy of 

24 at least 80 lumens per watt; and 


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1 ‘‘(B) be designed to use a light source with 

2 a lumen maintenance, calculated as mean rated 

3 lumens divided by initial lumens, of at least 

4 0.65. 

5 ‘‘(4) In addition to the requirements of para6 graphs (1) through (3), each outdoor luminaire man7 ufactured on or after January 1, 2011, shall have 

8 the capability of producing at least two different 

9 light levels, including 100 percent and 60 percent of 

10 full lamp output as tested with the maximum rated 

11 lamp per UL1598 or the manufacturer’s maximum 

12 specified for the luminaire under test. 

13 ‘‘(5)(A) Not later than January 1, 2017, the 

14 Secretary shall issue a final rule amending the appli15 cable standards established in paragraphs (3) and 

16 (4) if technologically feasible and economically justi17 fied. 

18 ‘‘(B) A final rule issued under subparagraph 

19 (A) shall establish efficiency standards at the max20 imum level that is technically feasible and economi21 cally justified, as provided in subsections (o) and (p) 

22 of section 325. The Secretary may also, in such rule23 making, amend or discontinue the product exclusions 

24 listed in section 340(26)(A) through (P), or amend 

25 the lumen maintenance requirements in paragraph 


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1 (3) if the Secretary determines that such amend2 ments are consistent with the purposes of this Act. 

3 ‘‘(C) If the Secretary issues a final rule under 

4 subparagraph (A) establishing amended standards, 

5 the final rule shall provide that the amended stand6 ards apply to products manufactured on or after 

7 January 1, 2020, or one year after the date on 

8 which the final amended standard is published, 

9 whichever is later. 

10 ‘‘(h) OUTDOOR HIGH LIGHT OUTPUT LAMPS.—Each 

11 outdoor high light output lamp manufactured on or after 

12 January 1, 2012, shall have a lighting efficiency of at least 

13 45 lumens per watt.’’. 

14 (3) TEST PROCEDURES.— Section 343(a) of the 

15 Energy Policy and Conservation Act (42 U.S.C. 

16 6314(a)) is amended by adding at the end the fol17 lowing: 

18 ‘‘(10) OUTDOOR LIGHTING.— 

19 ‘‘(A) With respect to outdoor luminaires 

20 and outdoor high light output lamps, the test 

21 procedures shall be based upon the test proce22 dures specified in illuminating engineering soci23 ety procedures LM–79 as of March 1, 2009, 

24 and LM-31, and/or other appropriate consensus 

25 test procedures developed by the Illuminating 


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1 Engineering Society or other appropriate con2 sensus standards bodies. 

3 ‘‘(B) If illuminating engineering society 

4 procedure LM—79 is amended, the Secretary 

5 shall amend the test procedures established in 

6 subparagraph (A) as necessary to be consistent 

7 with the amended LM–79 test procedure, unless 

8 the Secretary determines, by rule, published in 

9 the Federal Register and supported by clear 

10 and convincing evidence, that to do so would 

11 not meet the requirements for test procedures 

12 under paragraph (2). 

13 ‘‘(C) The Secretary may revise the test 

14 procedures for outdoor luminaires or outdoor 

15 high light output lamps by rule consistent with 

16 paragraph (2), and may incorporate as appro17 priate consensus test procedures developed by 

18 the Illuminating Engineering Society or other 

19 appropriate consensus standards bodies.’’. 

20 (4) PREEMPTION.— Section 345 of the Energy 

21 Policy and Conservation Act (42 U.S.C. 6316) is 

22 amended by adding at the end the following: 

23 ‘‘(i)(1) Except as provided in paragraph (2), section 

24 327 shall apply to outdoor luminaires to the same extent 


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1 and in the same manner as the section applies under part 

2 B. 

3 ‘‘(2) Any State standard that is adopted on or before 

4 January 1, 2015, pursuant to a statutory requirement to 

5 adopt efficiency standards for reducing outdoor lighting 

6 energy use enacted prior to January 31, 2008, shall not 

7 be preempted.’’. 

8 (5) ENERGY EFFICIENCY STANDARDS FOR CER9 TAIN LUMINAIRES.—Not later than 1 year after the 

10 date of enactment of this Act, the Secretary of En11 ergy shall, in consultation with the National Elec12 trical Manufacturers Association, collect data for 

13 United States sales of luminaires described in sec14 tion 340(26)(H) and (M) of the Energy Policy and 

15 Conservation Act, to determine the historical growth 

16 rate. If the Secretary finds that the growth in mar17 ket share of such luminaires exceeds twice the year 

18 to year rate of the average of the previous three 

19 years, then the Secretary shall within 12 months ini20 tiate a rulemaking to determine if such exclusion 

21 should be eliminated, if substitute products exist 

22 that perform more efficiently and fulfill the perform23 ance functions of these luminaires. 

24 (b) PORTABLE LIGHTING.— 

25 (1) PORTABLE LIGHT FIXTURES.— 


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1 (A) DEFINITIONS.—Section 321 of the En2 ergy Policy and Conservation Act (42 U.S.C. 

3 6291) is amended by adding at the end the fol4 lowing: 

5 ‘‘(67) ART WORK LIGHT FIXTURE.—The term 

6 ‘art work light fixture’ means a light fixture de7 signed only to be mounted directly to an art work 

8 and for the purpose of illuminating that art work. 

9 ‘‘(68) LED LIGHT ENGINE.—The term ‘LED 

10 light engine’ or ‘LED light engine with integral heat 

11 sink’ means a subsystem of an LED light fixture 

12 that— 

13 ‘‘(A) includes 1 or more LED components, 

14 including— 

15 ‘‘(i) an LED driver power source with 

16 electrical and mechanical interfaces; and 

17 ‘‘(ii) an integral heat sink to provide 

18 thermal dissipation; and 

19 ‘‘(B) may be designed to accept additional 

20 components that provide aesthetic, optical, and 

21 environmental control. 

22 ‘‘(69) LED LIGHT FIXTURE.—The term ‘LED 

23 light fixture’ means a complete lighting unit con24 sisting of— 


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1 ‘‘(A) an LED light source with 1 or more 

2 LED lamps or LED light engines; and 

3 ‘‘(B) parts— 

4 ‘‘(i) to distribute the light; 

5 ‘‘(ii) to position and protect the light 

6 source; and 

7 ‘‘(iii) to connect the light source to 

8 electrical power. 

9 ‘‘(70) LIGHT FIXTURE.—The term ‘light fix10 ture’ means a product designed to provide light that 

11 includes— 

12 ‘‘(A) at least 1 lamp socket; and 

13 ‘‘(B) parts— 

14 ‘‘(i) to distribute the light; 

15 ‘‘(ii) position and protect 1 or more 

16 lamps; and 

17 ‘‘(iii) to connect 1 or more lamps to a 

18 power supply. 

19 ‘‘(71) PORTABLE LIGHT FIXTURE.— 

20 ‘‘(A) IN GENERAL.—The term ‘portable 

21 light fixture’ means a light fixture that has a 

22 flexible cord and an attachment plug for con23 nection to a nominal 120-volt circuit that— 

24 ‘‘(i) allows the user to relocate the 

25 product without any rewiring; and 


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1 ‘‘(ii) typically can be controlled with a 

2 switch located on the product or the power 

3 cord of the product. 

4 ‘‘(B) EXCLUSIONS.—The term ‘portable 

5 light fixture’ does not include— 

6 ‘‘(i) direct plug-in night lights, sun or 

7 heat lamps, medical or dental lights, port8 able electric hand lamps, signs or commer9 cial advertising displays, photographic 

10 lamps, germicidal lamps, or light fixtures 

11 for marine use or for use in hazardous lo12 cations (as those terms are defined in 

13 ANSI/NFPA 70 of the National Electrical 

14 Code); or 

15 ‘‘(ii) decorative lighting strings, deco16 rative lighting outfits, or electric candles or 

17 candelabra without lamp shades that are 

18 covered by Underwriter Laboratories (UL) 

19 standard 588, ‘Seasonal and Holiday Dec20 orative Products’.’’. 

21 (B) COVERAGE.— 

22 (i) IN GENERAL.—Section 322(a) of 

23 the Energy Policy and Conservation Act 

24 (42 U.S.C. 6292(a)) is amended— 


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1 (I) by redesignating paragraph 

2 (20) as paragraph (24); and 

3 (II) by inserting after paragraph 

4 (19) the following: 

5 ‘‘(20) Portable light fixtures.’’. 

6 (ii) CONFORMING AMENDMENTS.— 

7 Section 325(l) of the Energy Policy and 

8 Conservation Act (42 U.S.C. 6295(l)) is 

9 amended by striking ‘‘paragraph (19)’’ 

10 each place it appears in paragraphs (1) 

11 and (2) and inserting ‘‘paragraph (24)’’. 

12 (C) TEST PROCEDURES.—Section 323(b) 

13 of the Energy Policy and Conservation Act (42 

14 U.S.C. 6293(b)) is amended by adding at the 

15 end the following: 

16 ‘‘(19) LED FIXTURES AND LED LIGHT EN17 GINES.—Test procedures for LED fixtures and LED 

18 light engines shall be based on Illuminating Engi19 neering Society of North America (IESNA) test pro20 cedure LM–79, Approved Method for Electrical and 

21 Photometric Testing of Solid-State Lighting Devices, 

22 and IESNA-approved test procedure for testing 

23 LED light engines.’’. 


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1 (D) STANDARDS.—Section 325 of the En2 ergy Policy and Conservation Act (42 U.S.C. 

3 6295) is amended— 

4 (i) by redesignating subsection (ii) as 

5 subsection (oo); 

6 (ii) in subsection (oo)(2), as redesig7 nated in clause (i) of this subparagraph, by 

8 striking ‘‘(hh)’’ each place it appears and 

9 inserting ‘‘(mm)’’; and 

10 (iii) by inserting after subsection (hh) 

11 the following: 

12 ‘‘(ii) PORTABLE LIGHT FIXTURES.— 

13 ‘‘(1) IN GENERAL.—Subject to paragraphs (2) 

14 and (3), portable light fixtures manufactured on or 

15 after January 1, 2012, shall meet 1 or more of the 

16 following requirements: 

17 ‘‘(A) Be a fluorescent light fixture that 

18 meets the requirements of the Energy Star Pro19 gram for Residential Light Fixtures, Version 

20 4.2. 

21 ‘‘(B) Be equipped with only 1 or more 

22 GU–24 line-voltage sockets, not be rated for 

23 use with incandescent lamps of any type (as de24 fined in ANSI standards), and meet the reVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00396 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 quirements of version 4.2 of the Energy Star 

2 program for residential light fixtures. 

3 ‘‘(C) Be an LED light fixture or a light 

4 fixture with an LED light engine and comply 

5 with the following minimum requirements: 

6 ‘‘(i) Minimum light output: 200 

7 lumens (initial). 

8 ‘‘(ii) Minimum LED light engine effi9 cacy: 40 lumens/watt installed in fixtures 

10 that meet the minimum light fixture effi11 cacy of 29 lumens/watt or, alternatively, a 

12 minimum LED light engine efficacy of 60 

13 lumens/watt for fixtures that do not meet 

14 the minimum light fixture efficacy of 29 

15 lumens/watt. 

16 ‘‘(iii) All portable fixtures shall have a 

17 minimum LED light fixture efficacy of 29 

18 lumens/watt and a minimum LED light 

19 engine efficacy of 60 lumens/watt by Janu20 ary 1, 2016. 

21 ‘‘(iv) Color Correlated Temperature 

22 (CCT): 2700K through 4000K. 

23 ‘‘(v) Minimum Color Rendering Index 

24 (CRI): 75. 


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1 ‘‘(vi) Power factor equal to or greater 

2 than 0.70. 

3 ‘‘(vii) Portable luminaries that have 

4 internal power supplies shall have zero 

5 standby power when the luminaire is 

6 turned off. 

7 ‘‘(viii) LED light sources shall deliver 

8 at least 70 percent of initial lumens for at 

9 least 25,000 hours. 

10 ‘‘(D)(i) Be equipped with an ANSI-des11 ignated E12, E17, or E26 screw-based socket 

12 and be prepackaged and sold together with 1 

13 screw-based compact fluorescent lamp or screw14 based LED lamp for each screw-based socket 

15 on the portable light fixture. 

16 ‘‘(ii) The compact fluorescent or LED 

17 lamps prepackaged with the light fixture shall 

18 be fully compatible with any light fixture con19 trols incorporated into the light fixture (for ex20 ample, light fixtures with dimmers shall be 

21 packed with dimmable lamps). 

22 ‘‘(iii) Compact fluorescent lamps pre23 packaged with light fixtures shall meet the re24 quirements of the Energy Star Program for 

25 CFLs Version 4.0. 


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1 ‘‘(iv) Screw-based LED lamps shall comply 

2 with the minimum requirements described in 

3 subparagraph (C). 

4 ‘‘(E) Be equipped with 1 or more single5 ended, non-screw based halogen lamp sockets 

6 (line or low voltage), a dimmer control or high7 low control, and be rated for a maximum of 100 

8 watts. 

9 ‘‘(2) REVIEW.— 

10 ‘‘(A) REVIEW.—The Secretary shall review 

11 the criteria and standards established under 

12 paragraph (1) to determine if revised standards 

13 are technologically feasible and economically 

14 justified. 

15 ‘‘(B) COMPONENTS.—The review shall in16 clude consideration of— 

17 ‘‘(i) whether a separate compliance 

18 procedure is still needed for halogen fix19 tures described in subparagraph (E) and, 

20 if necessary, what an appropriate standard 

21 for halogen fixtures shall be; 

22 ‘‘(ii) whether the specific technical cri23 teria described in subparagraphs (A), (C), 

24 and (D)(iii) should be modified; and 


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1 ‘‘(iii) which fixtures should be exempt2 ed from the light fixture efficacy standard 

3 as of January 1, 2016, because the fix4 tures are primarily decorative in nature (as 

5 defined by the Secretary) and, even if ex6 empted, are likely to be sold in limited 

7 quantities. 

8 ‘‘(C) TIMING.— 

9 ‘‘(i) DETERMINATION.—Not later 

10 than January 1, 2014, the Secretary shall 

11 publish amended standards, or a deter12 mination that no amended standards are 

13 justified, under this subsection. 

14 ‘‘(ii) STANDARDS.—Any standards 

15 under this paragraph shall take effect on 

16 January 1, 2016. 

17 ‘‘(3) ART WORK LIGHT FIXTURES.—Art work 

18 light fixtures manufactured on or after January 1, 

19 2012, shall— 

20 ‘‘(A) comply with paragraph (1); or 

21 ‘‘(B)(i) contain only ANSI-designated E12 

22 screw-based line-voltage sockets; 

23 ‘‘(ii) have not more than 3 sockets; 

24 ‘‘(iii) be controlled with an integral high/ 

25 low switch; 


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1 ‘‘(iv) be rated for not more than 25 watts 

2 if fitted with 1 socket; and 

3 ‘‘(v) be rated for not more than 15 watts 

4 per socket if fitted with 2 or 3 sockets. 

5 ‘‘(4) EXCEPTION FROM PREEMPTION.—Not6 withstanding section 327, Federal preemption shall 

7 not apply to a regulation concerning portable light 

8 fixtures adopted by the California Energy Commis9 sion on or before January 1, 2014.’’. 

10 (2) GU–24 BASE LAMPS.— 

11 (A) DEFINITIONS.—Section 321 of the En12 ergy Policy and Conservation Act (42 U.S.C. 

13 6291) (as amended by paragraph (1)(A)) is 

14 amended by adding at the end the following: 

15 ‘‘(72) GU–24.—The term ‘GU–24’ means the 

16 designation of a lamp socket, based on a coding sys17 tem by the International Electrotechnical Commis18 sion, under which— 

19 ‘‘(A) ‘G’ indicates a holder and socket type 

20 with 2 or more projecting contacts, such as pins 

21 or posts; 

22 ‘‘(B) ‘U’ distinguishes between lamp and 

23 holder designs of similar type that are not 

24 interchangeable due to electrical or mechanical 

25 requirements; and 


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1 ‘‘(C) 24 indicates the distance in millime2 ters between the electrical contact posts. 

3 ‘‘(73) GU-24 ADAPTOR.— 

4 ‘‘(A) IN GENERAL.—The term ‘GU-24 

5 Adaptor’ means a 1-piece device, pig-tail, wiring 

6 harness, or other such socket or base attach7 ment that— 

8 ‘‘(i) connects to a GU-24 socket on 1 

9 end and provides a different type of socket 

10 or connection on the other end; and 

11 ‘‘(ii) does not alter the voltage. 

12 ‘‘(B) EXCLUSION.—The term ‘GU-24 

13 Adaptor’ does not include a fluorescent ballast 

14 with a GU–24 base. 

15 ‘‘(74) GU–24 BASE LAMP.—‘GU–24 base lamp’ 

16 means a light bulb designed to fit in a GU–24 sock17 et.’’. 

18 (B) STANDARDS.—Section 325 of the En19 ergy Policy and Conservation Act (42 U.S.C. 

20 6295) (as amended by paragraph (1)(D)) is 

21 amended by inserting after subsection (ii) the 

22 following: 

23 ‘‘(jj) GU–24 BASE LAMPS.— 

24 ‘‘(1) IN GENERAL.—A GU–24 base lamp shall 

25 not be an incandescent lamp as defined by ANSI. 


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1 ‘‘(2) GU-24 ADAPTORS.—GU–24 adaptors shall 

2 not adapt a GU–24 socket to any other line voltage 

3 socket.’’. 

4 (3) STANDARDS FOR CERTAIN INCANDESCENT

5 REFLECTOR LAMPS.—Section 325(i) of the Energy 

6 Policy and Conservation Act (42 U.S.C. 6295(i)), as 

7 amended by section 161(a)(12) of this Act, is 

8 amended by adding at the end the following: 

9 ‘‘(9) CERTAIN INCANDESCENT REFLECTOR

10 LAMPS.—(A) No later than 12 months after enact11 ment of this paragraph, the Secretary shall publish 

12 a final rule establishing standards for incandescent 

13 reflector lamp types described in paragraph (1)(D). 

14 Such standards shall be effective on July 1, 2013. 

15 ‘‘(B) Any rulemaking for incandescent reflector 

16 lamps completed after enactment of this section 

17 shall consider standards for all incandescent reflec18 tor lamps, inclusive of those specified in paragraph 

19 (1)(C). 

20 ‘‘(10) REFLECTOR LAMPS.—No later than Jan21 uary 1, 2015, the Secretary shall publish a final rule 

22 establishing and amending standards for reflector 

23 lamps, including incandescent reflector lamps. Such 

24 standards shall be effective no sooner than three 

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1 making shall consider incandescent and non2 incandescent technologies. Such rulemaking shall 

3 consider a new metric other than lumens-per-watt 

4 based on the photometric distribution of light from 

5 such lamps.’’. 

6 SEC. 212. OTHER APPLIANCE EFFICIENCY STANDARDS. 

7 (a) STANDARDS FOR WATER DISPENSERS, HOT

8 FOOD HOLDING CABINETS, AND PORTABLE ELECTRIC

9 SPAS.— 

10 (1) DEFINITIONS.—Section 321 of the Energy 

11 Policy and Conservation Act (42 U.S.C. 6291), as 

12 amended by section 211 of this Act, is further 

13 amended by adding at the end the following: 

14 ‘‘(75) The term ‘water dispenser’ means a fac15 tory-made assembly that mechanically cools and 

16 heats potable water and that dispenses the cooled or 

17 heated water by integral or remote means. 

18 ‘‘(76) The term ‘bottle-type water dispenser’ 

19 means a drinking water dispenser designed for dis20 pensing both hot and cold water that uses a remov21 able bottle or container as the source of potable 

22 water. 

23 ‘‘(77) The term ‘commercial hot food holding 

24 cabinet’ means a heated, fully-enclosed compartment 

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1 signed to maintain the temperature of hot food that 

2 has been cooked in a separate appliance. Such term 

3 does not include heated glass merchandizing cabi4 nets, drawer warmers, commercial hot food holding 

5 cabinets with interior volumes of less than 8 cubic 

6 feet, or cook-and-hold appliances. 

7 ‘‘(78) The term ‘portable electric spa’ means a 

8 factory-built electric spa or hot tub, supplied with 

9 equipment for heating and circulating water.’’. 

10 (2) COVERAGE.—Section 322(a) of the Energy 

11 Policy and Conservation Act (42 U.S.C. 6292(a)), as 

12 amended by section 211(b)(1)(B) of this Act, is fur13 ther amended by inserting after paragraph (20) the 

14 following new paragraphs: 

15 ‘‘(21) Bottle type water dispensers. 

16 ‘‘(22) Commercial hot food holding cabinets. 

17 ‘‘(23) Portable electric spas.’’. 

18 (3) TEST PROCEDURES.—Section 323(b) of the 

19 Energy Policy and Conservation Act (42 U.S.C. 

20 6293(b)), as amended by section 211(b)(1)(C) of 

21 this Act, is further amended by adding at the end 

22 the following: 

23 ‘‘(20) BOTTLE TYPE WATER DISPENSERS.— 

24 Test procedures for bottle type water dispensers 

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1 ments for Bottled Water Coolers version 1.1’ pub2 lished by the Environmental Protection Agency. 

3 Units with an integral, automatic timer shall not be 

4 tested using section 4D, ‘Timer Usage,’ of the test 

5 criteria. 

6 ‘‘(21) COMMERCIAL HOT FOOD HOLDING CABI7 NETS.—Test procedures for commercial hot food 

8 holding cabinets shall be based on the test proce9 dures described in ANSI/ASTM F2140–01 (Test for 

10 idle energy rate-dry test). Interior volume shall be 

11 based on the method shown in the Environmental 

12 Protection Agency’s ‘Energy Star Program Require13 ments for Commercial Hot Food Holding Cabinets’ 

14 as in effect on August 15, 2003. 

15 ‘‘(22) PORTABLE ELECTRIC SPAS.—Test proce16 dures for portable electric spas shall be based on the 

17 test method for portable electric spas contained in 

18 section 1604, title 20, California Code of Regula19 tions as amended on December 3, 2008. When the 

20 American National Standards Institute publishes a 

21 test procedure for portable electric spas, the Sec22 retary shall revise the Department of Energy’s pro23 cedure.’’. 

24 (4) STANDARDS.—Section 325 of the Energy 

25 Policy and Conservation Act (42 U.S.C. 6295), as 


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1 amended by section 211 of this Act, is further 

2 amended by adding after subsection (jj) the fol3 lowing: 

4 ‘‘(kk) BOTTLE TYPE WATER DISPENSERS.—Effec5 tive January 1, 2012, bottle-type water dispensers de6 signed for dispensing both hot and cold water shall not 

7 have standby energy consumption greater than 1.2 kilo8 watt-hours per day. 

9 ‘‘(ll) COMMERCIAL HOT FOOD HOLDING CABI10 NETS.—Effective January 1, 2012, commercial hot food 

11 holding cabinets with interior volumes of 8 cubic feet or 

12 greater shall have a maximum idle energy rate of 40 watts 

13 per cubic foot of interior volume. 

14 ‘‘(mm) PORTABLE ELECTRIC SPAS.—Effective Janu15 ary 1, 2012, portable electric spas shall not have a normalized standby power greater than 5(V2 16 ⁄3) Watts where 

17 V=the fill volume in gallons. 

18 ‘‘(nn) REVISIONS.—The Secretary of Energy shall 

19 consider revisions to the standards in subsections (kk), 

20 (ll), and (mm) in accordance with subsection (o) and pub21 lish a final rule no later than January 1, 2013 establishing 

22 such revised standards, or make a finding that no revi23 sions are technically feasible and economically justified. 

24 Any such revised standards shall take effect January 1, 

25 2016.’’. 


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1 (b) COMMERCIAL FURNACE EFFICIENCY STAND2 ARDS.—Section 342(a) of the Energy Policy and Con3 servation Act (42 U.S.C. 6312(a)) is amended by inserting 

4 after paragraph (10) the following new paragraph: 

5 ‘‘(11) WARM AIR FURNACES.—Each warm air 

6 furnace with an input rating of 225,000 Btu per 

7 hour or more and manufactured after January 1, 

8 2011, shall meet the following standard levels: 

9 ‘‘(A) GAS-FIRED UNITS.— 

10 ‘‘(i) Minimum thermal efficiency of 80 

11 percent. 

12 ‘‘(ii) Include an interrupted or inter13 mittent ignition device. 

14 ‘‘(iii) Have jacket losses not exceeding 

15 0.75 percent of the input rating. 

16 ‘‘(iv) Have either power venting or a 

17 flue damper. 

18 ‘‘(B) OIL-FIRED UNITS.— 

19 ‘‘(i) Minimum thermal efficiency of 81 

20 percent. 

21 ‘‘(ii) Have jacket losses not exceeding 

22 0.75 percent of the input rating. 

23 ‘‘(iii) Have either power venting or a 

24 flue damper.’’. 


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1 SEC. 213. APPLIANCE EFFICIENCY DETERMINATIONS AND 

2 PROCEDURES. 

3 (a) DEFINITION OF ENERGY CONSERVATION STAND4 ARD.—Section 321(6) of the Energy Policy and Conserva5 tion Act (42 U.S.C. 6291(6)) is amended to read as fol6 lows: 

7 ‘‘(6) ENERGY CONSERVATION STANDARD.— 

8 ‘‘(A) IN GENERAL.—The term ‘energy con9 servation standard’ means 1 or more perform10 ance standards that— 

11 ‘‘(i) for covered products (excluding 

12 clothes washers, dishwashers, showerheads, 

13 faucets, water closets, and urinals), pre14 scribe a minimum level of energy efficiency 

15 or a maximum quantity of energy use, de16 termined in accordance with test proce17 dures prescribed under section 323; 

18 ‘‘(ii) for showerheads, faucets, water 

19 closets, and urinals, prescribe a minimum 

20 level of water efficiency or a maximum 

21 quantity of water use, determined in ac22 cordance with test procedures prescribed 

23 under section 323; and 

24 ‘‘(iii) for clothes washers and dish25 washers— 


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1 ‘‘(I) prescribe a minimum level of 

2 energy efficiency or a maximum quan3 tity of energy use, determined in ac4 cordance with test procedures pre5 scribed under section 323; and 

6 ‘‘(II) may include a minimum 

7 level of water efficiency or a maximum 

8 quantity of water use, determined in 

9 accordance with those test procedures. 

10 ‘‘(B) INCLUSIONS.—The term ‘energy con11 servation standard’ includes— 

12 ‘‘(i) 1 or more design requirements, if 

13 the requirements were established— 

14 ‘‘(I) on or before the date of en15 actment of this subclause; 

16 ‘‘(II) as part of a direct final rule 

17 under section 325(p)(4); or 

18 ‘‘(III) as part of a final rule pub19 lished on or after January 1, 2012, 

20 and 

21 ‘‘(ii) any other requirements that the 

22 Secretary may prescribe under section 

23 325(r). 

24 ‘‘(C) EXCLUSION.—The term ‘energy con25 servation standard’ does not include a performVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00410 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ance standard for a component of a finished 

2 covered product, unless regulation of the com3 ponent is specifically authorized or established 

4 pursuant to this title.’’. 

5 (b) ADOPTING CONSENSUS TEST PROCEDURES AND

6 TEST PROCEDURES IN USE ELSEWHERE.—Section 

7 323(b) of the Energy Policy and Conservation Act (42 

8 U.S.C. 6293(b)), as amended by sections 211 and 212 of 

9 this Act, is further amended by adding the following new 

10 paragraph after paragraph (22): 

11 ‘‘(23) CONSENSUS AND ALTERNATE TEST PRO12 CEDURES.— 

13 ‘‘(A) RECEIPT OF JOINT RECOMMENDA14 TION OR ALTERNATE TESTING PROCEDURE.— 

15 On receipt of— 

16 ‘‘(i) a statement that is submitted 

17 jointly by interested persons that are fairly 

18 representative of relevant points of view 

19 (including representatives of manufactur20 ers of covered products, States, and effi21 ciency advocates), as determined by the 

22 Secretary, and contains recommendations 

23 with respect to the testing procedure for a 

24 covered product; or 


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1 ‘‘(ii) a submission of a testing proce2 dure currently in use for a covered product 

3 by a State, nation, or group of nations— 

4 ‘‘(I) if the Secretary determines 

5 that the recommended testing proce6 dure contained in the statement or 

7 submission is in accordance with sub8 section (b)(3), the Secretary may 

9 issue a final rule that establishes an 

10 energy or water conservation testing 

11 procedure that is published simulta12 neously with a notice of proposed rule13 making that proposes a new or 

14 amended energy or water conservation 

15 testing procedure that is identical to 

16 the testing procedure established in 

17 the final rule to establish the rec18 ommended testing procedure (referred 

19 to in this paragraph as a ‘direct final 

20 rule’); or 

21 ‘‘(II) if the Secretary determines 

22 that a direct final rule cannot be 

23 issued based on the statement or sub24 mission, the Secretary shall publish a 

25 notice of the determination, together 


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1 with an explanation of the reasons for 

2 the determination. 

3 ‘‘(B) PUBLIC COMMENT.—The Secretary 

4 shall solicit public comment for a period of at 

5 least 110 days with respect to each direct final 

6 rule issued by the Secretary under subpara7 graph (A)(ii)(I). 

8 ‘‘(C) WITHDRAWAL OF DIRECT FINAL

9 RULES.— 

10 ‘‘(i) IN GENERAL.—Not later than 

11 120 days after the date on which a direct 

12 final rule issued under subparagraph 

13 (A)(ii)(I) is published in the Federal Reg14 ister, the Secretary shall withdraw the di15 rect final rule if— 

16 ‘‘(I) the Secretary receives 1 or 

17 more adverse public comments relat18 ing to the direct final rule under sub19 paragraph (B)or any alternative joint 

20 recommendation; and 

21 ‘‘(II) based on the rulemaking 

22 record relating to the direct final rule, 

23 the Secretary determines that such 

24 adverse public comments or alter25 native joint recommendation may proVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00413 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 vide a reasonable basis for with2 drawing the direct final rule under 

3 paragraph (3) or any other applicable 

4 law. 

5 ‘‘(ii) ACTION ON WITHDRAWAL.—On 

6 withdrawal of a direct final rule under 

7 clause (i), the Secretary shall— 

8 ‘‘(I) proceed with the notice of 

9 proposed rulemaking published simul10 taneously with the direct final rule as 

11 described in subparagraph (A)(ii)(I); 

12 and 

13 ‘‘(II) publish in the Federal Reg14 ister the reasons why the direct final 

15 rule was withdrawn. 

16 ‘‘(iii) TREATMENT OF WITHDRAWN DI17 RECT FINAL RULES.—A direct final rule 

18 that is withdrawn under clause (i) shall 

19 not be considered to be a final rule for 

20 purposes of subsection (b). 

21 ‘‘(D) EFFECT OF PARAGRAPH.—Nothing 

22 in this paragraph authorizes the Secretary to 

23 issue a direct final rule based solely on receipt 

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1 ommended test procedures relating to the direct 

2 final rule.’’. 

3 (c) UPDATING TELEVISION TEST METHODS.—Sec4 tion 323(b) of the Energy Policy and Conservation Act 

5 (42 U.S.C. 6293(b)), as amended by sections 211 and 212 

6 of this Act, and subsection (b) of this section, is further 

7 amended by adding at the end the following new para8 graph: 

9 ‘‘(24) TELEVISIONS.—(A) On the date of enact10 ment of this paragraph, Appendix H to Subpart B 

11 of Part 430 of the United States Code of Federal 

12 Regulations, ‘Uniform Test Method for Measuring 

13 the Energy Consumption of Television Sets’, is re14 pealed. 

15 ‘‘(B) No later than 12 months after the date of 

16 enactment of this paragraph the Secretary shall pub17 lish in the Federal Register a final rule prescribing 

18 a new test method for televisions.’’. 

19 (d) CRITERIA FOR PRESCRIBING NEW OR AMENDED

20 STANDARDS.—(1) Section 325(o)(2)(B)(i) of the Energy 

21 Policy and Conservation Act (42 U.S.C. 6295(o)(2)(B)(i)) 

22 is amended as follows: 

23 (A) By striking ‘‘and’’ at the end of subclause 

24 (VI). 


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1 (B) By redesignating subclause (VII) as sub2 clause (XI). 

3 (C) By inserting the following new subclauses 

4 after subclause (VI): 

5 ‘‘(VII) the estimated value of the carbon dioxide 

6 and other emission reductions that will be achieved 

7 by virtue of the higher energy efficiency of the cov8 ered products resulting from the imposition of the 

9 standard; 

10 ‘‘(VIII) the estimated impact of standards for a 

11 particular product on average consumer energy 

12 prices; 

13 ‘‘(IX) the increased energy efficiency that may 

14 be attributable to the installation of Smart Grid 

15 technologies or capabilities in the covered products, 

16 if applicable in the determination of the Secretary; 

17 ‘‘(X) the availability in the United States or in 

18 other nations of examples or prototypes of covered 

19 products that achieve significantly higher efficiency 

20 standards for energy or for water; and’’. 

21 (2) Section 325(o)(2)(B)(iii) of such Act is amended 

22 as follows: 

23 (A) By striking ‘‘three’’ and inserting ‘‘5’’. 

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1 ful life of less than 5 years, such rebuttable pre2 sumption shall be determined utilizing 75 percent of 

3 the product’s average expected useful life as a multi4 plier instead of 5.’’. 

5 (C) By striking the last sentence and inserting 

6 the following: ‘‘Such a presumption may be rebutted 

7 only if the Secretary finds, based on clear, con8 vincing, and reliable evidence, that— 

9 ‘‘(I) such standard level would cause serious 

10 and unavoidable hardship to the average consumer 

11 of the product, or to manufacturers supplying a sig12 nificant portion of the market for the product, that 

13 substantially outweighs the standard level’s benefits; 

14 ‘‘(II) the standard and implementing regula15 tions cannot be designed to avoid or mitigate the 

16 hardship identified under subclause (I), through the 

17 adoption of regional standards consistent with para18 graph (6) of this subsection, or other reasonable 

19 means consistent with this part; 

20 ‘‘(III) the same or substantially similar hard21 ship would not occur under a standard adopted in 

22 the absence of the presumption, but that otherwise 

23 meets the requirements of this section; and 

24 ‘‘(IV) the hardship cannot be avoided or miti25 gated pursuant the procedures specified in section 


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1 504 of the Department of Energy Organization Act 

2 (42 U.S.C. 7194). 

3 A determination by the Secretary that the criteria trig4 gering such presumption are not met, or that the criterion 

5 for rebutting the presumption are met shall not be taken 

6 into consideration in the Secretary’s determination of 

7 whether a standard is economically justified.’’. 

8 (e) OBTAINING APPLIANCE INFORMATION FROM

9 MANUFACTURERS.—Section 326(d) of the Energy Policy 

10 and Conservation Act (42 U.S.C. 6295(d)) is amended to 

11 read as follows: 

12 ‘‘(d) INFORMATION REQUIREMENTS.—(1) For pur13 poses of carrying out this part, the Secretary shall publish 

14 proposed regulations not later than one year after the date 

15 of enactment of the American Clean Energy and Security 

16 Act of 2009, and after receiving public comment, final reg17 ulations not later than 18 months from such date of enact18 ment under this part or other provision of law adminis19 tered by the Secretary, which shall require each manufac20 turer of a covered product to submit information or re21 ports to the Secretary on an annual basis in a form adopt22 ed by the Secretary. Such reports shall include informa23 tion or data with respect to— 

24 ‘‘(A) the manufacturers’ compliance with all re25 quirements applicable pursuant to this part; 


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1 ‘‘(B) the economic impact of any proposed en2 ergy conservation standard; 

3 ‘‘(C) the manufacturers’ annual shipments of 

4 each class or category of covered products, orga5 nized, to the maximum extent practicable, by— 

6 ‘‘(i) energy efficiency, energy use, and, if 

7 applicable, water use; 

8 ‘‘(ii) the presence or absence of such effi9 ciency related or energy consuming operational 

10 characteristics or components as the Secretary 

11 determines are relevant for the purposes of car12 rying out this part; and 

13 ‘‘(iii) the State or regional location of sale, 

14 for covered products for which the Secretary 

15 may adopt regional standards; and 

16 ‘‘(D) such other categories of information as 

17 the Secretary deems relevant to carry out this part, 

18 including such other information as may be nec19 essary to establish and revise test procedures, label20 ing rules, and energy conservation standards and to 

21 insure compliance with the requirements of this 

22 part. 

23 ‘‘(2) In adopting regulations under this subsection, 

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1 formation, including nationally recognized certification 

2 programs of trade associations. 

3 ‘‘(3) The Secretary shall exercise authority under this 

4 section in a manner designed to minimize unnecessary 

5 burdens on manufacturers of covered products. 

6 ‘‘(4) To the extent that they do not conflict with the 

7 duties of the Secretary in carrying out this part, the provi8 sions of section 11(d) of the Energy Supply and Environ9 mental Coordination Act of 1974 (15 U.S.C. 796(d)) shall 

10 apply with respect to information obtained under this sub11 section to the same extent and in the same manner as 

12 they apply with respect to other energy information ob13 tained under such section.’’. 

14 (f) STATE WAIVER.—Section 327(c) of the Energy 

15 Policy and Conservation Act (42 U.S.C. 6297(c)), as 

16 amended by section 161(a)(19) of this Act, is further 

17 amended by adding at the end the following: 

18 ‘‘(12) is a regulation concerning standards for 

19 hot food holding cabinets, drinking water dispensers 

20 and portable electric spas adopted by the California 

21 Energy Commission on or before January 1, 2013.’’. 

22 (g) WAIVER OF FEDERAL PREEMPTION.—Paragraph 

23 (1) of section 327(d) of the Energy Policy and Conserva24 tion Act (42 U.S.C. 6297(d)) is amended as follows: 


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1 (1) In subparagraph (A) by striking ‘‘State reg2 ulation’’ each place it appears and inserting ‘‘State 

3 statute or regulation’’. 

4 (2) In subparagraph (B) by adding at the end 

5 the following new sentence: ‘‘In making such a find6 ing, the Secretary may not reject a petition for fail7 ure of the petitioning State or river basin commis8 sion to produce confidential information maintained 

9 by any manufacturer or distributor, or group or as10 sociation of manufacturers or distributors, and 

11 which the petitioning party does not have the legal 

12 right to obtain.’’. 

13 (3) In clause (ii) of subparagraph (C) by strik14 ing ‘‘costs’’ each place it appears and inserting ‘‘es15 timated costs’’. 

16 (4) In subparagraph (C) by striking ‘‘within the 

17 context of the State’s energy plan and forecast, 

18 and,’’. 

19 (h) INCLUSION OF CARBON OUTPUT ON APPLIANCE

20 ‘‘ENERGYGUIDE’’ LABELS.—(1) Section 324(a)(2) of the 

21 Energy Policy and Conservation Act (42 U.S.C. 

22 6294(a)(2)) is amended by adding the following at the 

23 end: 

24 ‘‘(I)(i) Not later than 90 days after the date of enact25 ment of this subparagraph, the Commission shall initiate 


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1 a rulemaking to implement the additional labeling require2 ments specified in subsection (c)(1)(C) of this section with 

3 an effective date for the revised labeling requirement not 

4 later than 12 months from issuance of the final rule. 

5 ‘‘(ii) Not later than 24 months after the date of en6 actment of this subparagraph, the Commission shall com7 plete the rulemaking initiated under clause (i). 

8 ‘‘(iii) Not later than 90 days after issuance of the 

9 final rule as provided in this subparagraph, the Secretary 

10 shall issue calculation methods required to effectuate the 

11 labeling requirements specified in subsection (c)(1)(C) of 

12 this section.’’. 

13 (2) Section 324(c)(1) of the Energy Policy and Con14 servation Act (42 U.S.C. 6294(c)(1)) is amended— 

15 (A) by striking ‘‘and’’ at the end of subpara16 graph (A); 

17 (B) by striking the period at the end of sub18 paragraph (B) and inserting a semicolon; and 

19 (C) by adding at the end the following new sub20 paragraphs: 

21 ‘‘(C) for products or groups of products pro22 viding a comparable function (including the group of 

23 products comprising the heating function of heat 

24 pumps and furnaces) among covered products listed 

25 in paragraphs (3), (4), (5), (8), (9), (10), and (11) 


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1 of section 322(a) of this part, and others designated 

2 by the Secretary, the estimated total annual atmos3 pheric carbon dioxide emissions (or their equivalent 

4 in other greenhouse gases) associated with, or 

5 caused by, the product, calculated utilizing— 

6 ‘‘(i) national average energy use for the 

7 product including energy consumed at the point 

8 of end use based on test procedures developed 

9 under section 323 of this part; 

10 ‘‘(ii) national average energy consumed or 

11 lost in the production, generation, transpor12 tation, storage, and distribution of energy to 

13 the point of end use; and 

14 ‘‘(iii) any direct emissions of greenhouse 

15 gases from the product during normal use; 

16 ‘‘(D) in determining the national average 

17 energy consumption and total annual atmos18 pheric carbon dioxide emissions, the Secretary 

19 shall utilize Federal Government sources, in20 cluding the Energy Information Administration 

21 Annual Energy Review, the Environmental Pro22 tection Agency eGRID data base, Environ23 mental Protection Agency AP–42 Emission 

24 Factors as amended, and other sources deter25 mined to be appropriate by the Secretary; and 


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1 ‘‘(E) information presenting, for each 

2 product (or group of products providing the 

3 comparable function) identified in section 

4 (c)(1)(C) of this section, the estimated annual 

5 carbon dioxide emissions calculated within the 

6 range of emissions calculated for all models of 

7 the product or group according to its function, 

8 including those models consuming fuels and 

9 those models not consuming fuels.’’. 

10 (i) PERMITTING STATES TO SEEK INJUNCTIVE EN11 FORCEMENT.—(1) Section 334 of the Energy Policy and 

12 Conservation Act (42 U.S.C. 6304) is amended to read 

13 as follows: 

14 ‘‘SEC. 334. JURISDICTION AND VENUE. 

15 ‘‘(a) JURISDICTION.—The United States district 

16 courts shall have jurisdiction to restrain— 

17 ‘‘(1) any violation of section 332; and 

18 ‘‘(2) any person from distributing in commerce 

19 any covered product which does not comply with an 

20 applicable rule under section 324 or 325. 

21 ‘‘(b) AUTHORITY.—Any action referred to in sub22 section (a) shall be brought by the Commission or by the 

23 attorney general of a State in the name of the State, ex24 cept that— 


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1 ‘‘(1) any such action to restrain any violation of 

2 section 332(a)(3) which relates to requirements pre3 scribed by the Secretary or any violation of section 

4 332(a)(4) which relates to request of the Secretary 

5 under section 326(b)(2) shall be brought by the Sec6 retary; and 

7 ‘‘(2) any violation of section 332(a)(5) or 

8 332(a)(7) shall be brought by the Secretary or by 

9 the attorney general of a State in the name of the 

10 State. 

11 ‘‘(c) VENUE AND SERVICE OF PROCESS.—Any such 

12 action may be brought in the United States district court 

13 for a district wherein any act, omission, or transaction 

14 constituting the violation occurred, or in such court of the 

15 district wherein the defendant is found or transacts busi16 ness. In any action under this section, process may be 

17 served on a defendant in any other district in which the 

18 defendant resides or may be found.’’. 

19 (2) The item relating to section 334 in the table of 

20 contents for such Act is amended to read as follows: 

‘‘Sec. 334. Jurisdiction and venue.’’. 

21 (j) TREATMENT OF APPLIANCES WITHIN BUILDING

22 CODES.—(1) Section 327(f)(3) of the Energy Policy and 

23 Conservation Act (42 U.S.C. 6297(f)(3)) is amended by 

24 striking subparagraphs (B) through (G) and inserting the 

25 following: 


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1 ‘‘(B) The code meets at least one of the fol2 lowing requirements: 

3 ‘‘(i) The code does not require that the 

4 covered product have an energy efficiency ex5 ceeding— 

6 ‘‘(I) the applicable energy conserva7 tion standard established in or prescribed 

8 under section 325; 

9 ‘‘(II) the level required by a regula10 tion of that State for which the Secretary 

11 has issued a rule granting a waiver under 

12 subsection (d) of this section; or 

13 ‘‘(III) the required level established in 

14 the International Energy Conservation 

15 Code or in a standard of the American So16 ciety of Heating, Refrigerating and Air17 Conditioning Engineers, or by the Sec18 retary pursuant to section 304 of the En19 ergy Conservation and Production Act. 

20 ‘‘(ii) If the code uses one or more baseline 

21 building designs against which all submitted 

22 building designs are to be evaluated and such 

23 baseline building designs contain a covered 

24 product subject to an energy conservation 

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1 tion 325, the baseline building designs are 

2 based on an efficiency level for such covered 

3 product which meets but does not exceed one of 

4 the levels specified in clause (i). 

5 ‘‘(iii) If the code sets forth one or more op6 tional combinations of items which meet the en7 ergy consumption or conservation objective, in 

8 at least one combination that the State has 

9 found to be reasonably achievable using com10 mercially available technologies the efficiency of 

11 the covered product meets but does not exceed 

12 one of the levels specified in clause (i). 

13 ‘‘(C) The credit to the energy consumption or 

14 conservation objective allowed by the code for install15 ing covered products having energy efficiencies ex16 ceeding one of the levels specified in subparagraph 

17 (B)(i) is on a one-for-one equivalent energy use or 

18 equivalent energy cost basis, taking into account the 

19 typical lifetime of the product. 

20 ‘‘(D) The energy consumption or conservation 

21 objective is specified in terms of an estimated total 

22 consumption of energy (which may be calculated 

23 from energy loss- or gain-based codes) utilizing an 

24 equivalent amount of energy (which may be specified 


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1 in units of energy or its equivalent cost) and equiva2 lent lifetimes. 

3 ‘‘(E) The estimated energy use of any covered 

4 product permitted or required in the code, or used 

5 in calculating the objective, is determined using the 

6 applicable test procedures prescribed under section 

7 323, except that the State may permit the estimated 

8 energy use calculation to be adjusted to reflect the 

9 conditions of the areas where the code is being ap10 plied if such adjustment is based on the use of the 

11 applicable test procedures prescribed under section 

12 323 or other technically accurate documented proce13 dure.’’. 

14 (2) Section 327(f)(4)(B) of the Energy Policy 

15 and Conservation Act (42 U.S.C. 6297(f)(4)(B)) is 

16 amended to read as follows: 

17 ‘‘(B) If a building code requires the installation of 

18 covered products with efficiencies exceeding the levels and 

19 requirements specified in paragraph (3)(B), such require20 ment of the building code shall not be applicable unless 

21 the Secretary has granted a waiver for such requirement 

22 under subsection (d) of this section.’’. 


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1 SEC. 214. BEST-IN-CLASS APPLIANCES DEPLOYMENT PRO2 GRAM. 

3 (a) IN GENERAL.—Not later than 1 year after the 

4 date of enactment of this Act, the Secretary of Energy, 

5 in consultation with the Administrator, shall establish a 

6 program to be known as the ‘‘Best-in-Class Appliances 

7 Deployment Program’’ to— 

8 (1) provide bonus payments to retailers or dis9 tributors under subsection (c) for sales of best-in10 class high-efficiency household appliance models, 

11 high-efficiency installed building equipment, and 

12 high-efficiency consumer electronics, with the goal of 

13 reducing life-cycle costs for consumers, encouraging 

14 innovation, and maximizing energy savings and pub15 lic benefit; 

16 (2) provide bounties under subsection (d) to re17 tailers and manufacturers for the replacement, re18 tirement, and recycling of old, inefficient, and envi19 ronmentally harmful products; and 

20 (3) provide premium awards under subsection 

21 (e) to manufacturers for developing and producing 

22 new Superefficient Best-in-Class Products. 

23 (b) DESIGNATION OF BEST-IN-CLASS PRODUCT

24 MODELS.— 

25 (1) IN GENERAL.—The Secretary of Energy 

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1 ment, or electronics as Best-in-Class Product mod2 els. The Secretary shall publicly announce the Best3 in-Class Product models designated under this sub4 section. The Secretary shall define product classes 

5 broadly and, except as provided in paragraph (2), 

6 shall designate as Best-in-Class Product models no 

7 more than the most efficient 10 percent of the com8 mercially available product models in a class that 

9 demonstrate, as a group, a distinctly greater energy 

10 efficiency than the average energy efficiency of that 

11 class of appliances, equipment, or electronics. In des12 ignating models, the Secretary shall— 

13 (A) identify commercially available models 

14 in the relevant class of products; 

15 (B) identify the subgroup of those models 

16 that share the distinctly higher energy-effi17 ciency characteristics that warrant designation 

18 as best-in-class; and 

19 (C) add other models in that class to the 

20 list of Best-in-Class Product models as they 

21 demonstrate their ability to meet the higher-ef22 ficiency characteristics on which the designation 

23 was made. 

24 (2) PERCENTAGE EXCEPTION.—If there are 

25 fewer than 10 product models in a class of products, 


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1 the Secretary may designate one or more of such 

2 models as Best-in-Class Products. 

3 (3) REVIEW OF BEST-IN-CLASS STANDARDS.— 

4 The Secretary shall review annually the product-spe5 cific criteria for designating, and the product models 

6 that qualify as, Best-in-Class Products and, after 

7 notice and a 30-day comment period, make upwards 

8 adjustments in the efficiency criteria as necessary to 

9 maintain an appropriate ratio of such product mod10 els to the total number of product models in the 

11 product class. 

12 (4) SMART GRID ENERGY EFFICIENCY SAV13 INGS.—The Secretary shall include energy efficiency 

14 savings achieved by a commercially available product 

15 having smart grid capability in determining the effi16 ciency level of a product for purposes of a Best-In17 Class Product designation pursuant to this sub18 section. In measuring energy efficiency savings 

19 achieved by smart grid capability, the Secretary 

20 shall use a metric that— 

21 (A) is based on the time-differentiated 

22 value and amount of energy consumption; 

23 (B) accounts for the capability of the prod24 uct to respond to a smart grid in which the 

25 physical capability of the product to save or 


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1 delay energy because of a smart grid feature is 

2 weighted by the likelihood that the feature will 

3 be used; 

4 (C) is based on the value of a unit of elec5 tric or gas consumption as a function of time 

6 of day and season; and 

7 (D) includes a test method by which the 

8 manufacturer shall determine the energy effi9 ciency of smart grid capable products. 

10 (c) BONUSES FOR SALES OF BEST-IN-CLASS PROD11 UCTS.— 

12 (1) IN GENERAL.—The Secretary of Energy 

13 shall make bonus payments to retailers or, as pro14 vided in paragraph (5)(B), distributors for the sale 

15 of Best-in-Class Products. 

16 (2) BONUS PROGRAM.—The Secretary shall— 

17 (A) publicly announce the availability and 

18 amount of the bonus to be paid for each sale 

19 of a Best-in-Class Product of a model des20 ignated under subsection (b); and 

21 (B) make bonus payments in at least that 

22 amount for each Best-in-Class Product of that 

23 model sold during the 3-year period beginning 

24 on the date the model is designated under sub25 section (b). 


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1 (3) UPGRADE OF BEST-IN-CLASS PRODUCT ELI2 GIBILITY.—In conducting a review under subsection 

3 (b)(3), the Secretary shall— 

4 (A) consider designating as a Best-in-Class 

5 Product model a Superefficient Best-in-Class 

6 Product model that has been designated pursu7 ant to subsection (e); 

8 (B) announce any change in the bonus 

9 payment as necessary to increase the market 

10 share of Best-in-Class Product models; 

11 (C) list models that will be eligible for bo12 nuses in the new amount; and 

13 (D) continue paying bonus payments at 

14 the original level, for the sale of any models 

15 that previously qualified as Best-in-Class Prod16 ucts but do not qualify at the new level, for the 

17 remainder of the 3-year period announced with 

18 the original designation. 

19 (4) SIZE OF INDIVIDUAL BONUS PAYMENTS.— 

20 (A) The size of each bonus payment under this sub21 section shall be the product of— 

22 (i) an amount determined by the Sec23 retary; and 


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1 (ii) the difference in energy consumption 

2 between the Best-in-Class Product and the av3 erage product in the product class. 

4 (B) The Secretary shall determine the amount 

5 under subparagraph (A)(i) for each product type, in 

6 consultation with State and utility efficiency pro7 gram administrators as well as the Administrator, 

8 based on estimates of the amount of bonus payment 

9 that would provide significant incentive to increase 

10 the market share of Best-in-Class Products. 

11 (5) ELIGIBLE BONUS RECIPIENT.—(A) The 

12 Secretary shall ensure that not more than 1 bonus 

13 payment is provided under this subsection for each 

14 Best-in-Class Product. 

15 (B) The Secretary may make distributors eligi16 ble to receive bonus payments under this subsection 

17 for sales that are not to the final end-user, to the 

18 extent that the Secretary determines that for a par19 ticular product category distributors are well situ20 ated to increase sales of Best-in-Class Products. 

21 (d) BOUNTIES FOR REPLACEMENT, RETIREMENT, 

22 AND RECYCLING OF EXISTING LOW-EFFICIENCY PROD23 UCTS.— 

24 (1) IN GENERAL.—The Secretary of Energy 

25 shall make bounty payments to— 


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1 (A) retailers for the replacement, retire2 ment, and recycling of older operating low-effi3 ciency products that might otherwise continue 

4 in operation; and 

5 (B) manufacturers of Superefficient Best6 in-Class Products for the retirement and recy7 cling of older operating low-efficiency products 

8 that perform the same function and which 

9 might otherwise continue in operation. 

10 (2) BOUNTIES.—Bounties shall be payable— 

11 (A) to a retailer upon documentation that 

12 the sale of a Best-in-Class Product was accom13 panied by the replacement, retirement, and re14 cycling of— 

15 (i) an inefficient but still-functioning 

16 product; or 

17 (ii) a nonfunctioning product con18 taining a refrigerant, by the consumer to 

19 whom the Best-in-Class Product was sold; 

20 and 

21 (B) to a manufacturer upon documentation 

22 of the retirement and recycling of— 

23 (i) an inefficient but still-functioning 

24 product from a consumer to whom a 


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1 Superefficient Best-in-Class Product was 

2 delivered; or 

3 (ii) a nonfunctioning product con4 taining a refrigerant from a consumer to 

5 whom a Superefficient Best-in-Class Prod6 uct was delivered. 

7 (3) AMOUNT.— 

8 (A) FUNCTIONING PRODUCTS.—The boun9 ty payment payable under this subsection for a 

10 product described in paragraphs (2)(A)(i) and 

11 (2)(B)(i) shall be based on the difference be12 tween the estimated energy use of the product 

13 replaced and the energy use of an average new 

14 product in the product class, over the estimated 

15 remaining lifetime of the product that was re16 placed. 

17 (B) NONFUNCTIONING PRODUCTS CON18 TAINING REFRIGERANTS.—The bounty payment 

19 payable under this subsection for a product de20 scribed in paragraphs (2)(A)(ii) and (2)(B)(ii) 

21 shall be in the amount that the Secretary of 

22 Energy, in consultation with the Administrator, 

23 determines is sufficient to promote the recycling 

24 of such products, up to the amount of bounty 


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1 for a comparable product described in para2 graphs (2)(A) and (2)(B). 

3 (4) RETIREMENT.—The Secretary shall ensure 

4 that no product for which a bounty is paid under 

5 this subsection is returned to active service, but that 

6 it is instead destroyed, and recycled to the extent 

7 feasible. 

8 (5) RECYCLING APPLIANCES CONTAINING RE9 FRIGERANTS.—Exclusively for the purpose of imple10 menting the bounty payment program for products 

11 containing a refrigerant under this section, the Ad12 ministrator shall establish standards for environ13 mentally responsible methods of recycling and dis14 posal of refrigerant-containing appliances that, at a 

15 minimum, meet the requirements set by the Respon16 sible Appliance Disposal (RAD) Program for refrig17 erant disposal. The Secretary shall ensure that such 

18 standards are met before a bounty payment is made 

19 under this subsection for a product containing a re20 frigerant. Nothing in this section shall be interpreted 

21 to alter the requirements of section 608 of the Clean 

22 Air Act or to relieve any person from complying with 

23 those requirements. 


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1 (e) PREMIUM AWARDS FOR DEVELOPMENT AND

2 PRODUCTION OF SUPEREFFICIENT BEST-IN-CLASS PROD3 UCTS.— 

4 (1) IN GENERAL.—(A) The Secretary of Energy 

5 shall provide premium awards to manufacturers for 

6 the development and production of Superefficient 

7 Best-in-Class Products. The Secretary shall set and 

8 periodically revise standards for eligibility of prod9 ucts for designation as a Superefficient Best-in10 Class Product. 

11 (B) The Secretary may establish a standard for 

12 a Superefficient Best-in-Class Product even if no 

13 product meeting that standard exists, if the Sec14 retary has reasonable grounds to conclude that a 

15 mass-producible product could be made to meet that 

16 standard. 

17 (C) The Secretary may also establish a Super18 efficient Best-in-Class Product standard that is met 

19 by one or more existing Best-in-Class Product mod20 els, if those product models have distinct energy effi21 ciency attributes and performance characteristics 

22 that make them significantly better than other prod23 uct models qualifying as best-in-class. The Secretary 

24 may not designate as Superefficient Best-in-Class 

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1 resent more than 10 percent of the currently quali2 fying Best-in-Class Product models. This subpara3 graph shall not apply to products designated pursu4 ant to paragraph (4)(A). 

5 (D) In making its finding on the efficiency level 

6 a product can achieve for purposes of a Supereffi7 cient Best-In-Class Product designation pursuant to 

8 this paragraph, the Secretary shall include energy 

9 efficiency savings that would be achieved by a prod10 uct as a result of smart grid capability when a prod11 uct having such capability can be produced and sold 

12 commercially to mass market consumers. In meas13 uring energy efficiency savings achieved by smart 

14 grid capability, the Secretary shall use a metric 

15 that– 

16 (i) is based on the time-differentiated value 

17 and amount of energy consumption; 

18 (ii) accounts for the capability of the prod19 uct to respond to a smart grid in which the 

20 physical capability of the product to save or 

21 delay energy because of a smart grid feature is 

22 weighted by the likelihood that the feature will 

23 be used; 


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1 (iii) is based on the value of a unit of elec2 tric or gas consumption as a function of time 

3 of day and season; and 

4 (iv) includes a test method by which the 

5 manufacturer shall determine the energy effi6 ciency of smart grid capable products. 

7 (2) PREMIUM AWARDS.—(A) The premium 

8 award payment provided to a manufacturer under 

9 this subsection shall be in addition to any bonus 

10 payments made under subsection (c). 

11 (B) The amount of the premium award paid 

12 per unit of Superefficient Best-in-Class Products 

13 sold to retailers or distributors shall, except as pro14 vided by subparagraph (F), be the product of— 

15 (i) an amount determined by the Sec16 retary; and 

17 (ii) the difference in energy consumption 

18 between the Superefficient Best-in-Class Prod19 uct and the average product in the product 

20 class. 

21 (C) The Secretary shall determine the amount 

22 under subparagraph (B)(i) for each product type, in 

23 consultation with State and utility efficiency pro24 gram administrators as well as the Administrator, 

25 based on consideration of the present value to the 


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1 Nation of the energy (and water or other resources 

2 or inputs) saved over the useful life of the product. 

3 The Secretary may also take into consideration the 

4 methods used to increase sales of qualifying prod5 ucts in determining such amount. 

6 (D) The Secretary may adjust the value de7 scribed in subparagraph (C) upward or downward as 

8 appropriate, including based on the effect of the pre9 mium awards on the sales of products in different 

10 classes that may be affected by the program under 

11 this subsection. 

12 (E) Premium award payments shall be applied 

13 to sales of any Superefficient Best-in-Class Product 

14 for the first 3 years after designation as a Supereffi15 cient Best-in-Class Product. 

16 (F) For years 2011 through 2013, the Sec17 retary shall make bonus payments to manufacturers 

18 of the products designated in paragraph (4)(A) for 

19 each product produced in the following amounts: 

20 (i) $75 for each dishwasher. 

21 (ii) $250 for each clothes washer. 

22 (iii) $200 for each refrigerator or refrig23 erator-freezer. 

24 (iv) $250 for each clothes dryer. 

25 (v) $200 for each cooking product. 


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1 (vi) $300 for each water heater. 

2 (3) COORDINATION OF INCENTIVES.—No prod3 uct for which Federal tax credit is received under 

4 section 45M of the Internal Revenue Code of 1986 

5 shall be eligible to receive premium award payments 

6 pursuant to this subsection. 

7 (4) DESIGNATIONS.— 

8 (A) INITIAL DESIGNATIONS.—Notwith9 standing any other provisions of this section, 

10 the products the Secretary shall designate as a 

11 Superefficient Best-In-Class Product include, 

12 but are not limited to, the following products 

13 manufactured in 2011 through 2013: 

14 (i) A dishwasher, clothes washer, re15 frigerator, or refrigerator-freezer that 

16 meets the highest efficiency performance 

17 standards in its product category as pro18 vided in Section 305(b) of the Emergency 

19 Economic Stabilization Act of 2008 and 

20 has the smart grid capability specified in 

21 paragraph (5). 

22 (ii) A water heater that meets an effi23 ciency standard that is the same or equiva24 lent to the standard provided in Section 

25 1333 of the Energy Policy Act of 2005 


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1 and has the smart grid capability specified 

2 in paragraph (5). 

3 (iii) A clothes dryer or cooking prod4 uct that the Secretary determines meets 

5 the standards specified in subsection (j)(3), 

6 which the Secretary shall promulgate no 

7 later than one year after the date of enact8 ment, and has the smart grid capability 

9 specified in paragraph (5). 

10 (B) EXTENSION OF INITIAL DESIGNA11 TIONS.— 

12 (i) GENERAL.—The Secretary shall in 

13 2013 extend the Superefficient Best-In14 Class Product designation of each product 

15 specified in subparagraph (A)(i) through 

16 (iii) through 2017, provided that for each 

17 product designation extended— 

18 (I) the extension will result in 

19 significant energy efficiency savings; 

20 (II) the product meets the Super21 efficient Best-In-Class Product cri22 teria specified in paragraph (1); 

23 (III) the eligibility standards of 

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1 pability specified in paragraph (5); 

2 and 

3 (IV) the Secretary makes appro4 priate revisions to the eligibility stand5 ards of the product as provided by 

6 paragraph (1). 

7 (ii) AWARDS.—If a Superefficient 

8 Best-In-Class Product designation for a 

9 product is extended pursuant to this sub10 paragraph, the premium award for the 

11 product shall be determined in accordance 

12 with paragraph (2). 

13 (5) SMART GRID CAPABILITY.— 

14 (A) Until the Secretary promulgates cri15 teria under subparagraph (B), the term ‘‘smart 

16 grid capability’’ means capability of receiving 

17 and interpreting time-of-use pricing and peak18 load-shed signals from a utility and— 

19 (i) in the case of a cooking product, 

20 reducing a minimum of 20 percent during 

21 peak demand as measured by the tested 

22 average wattage over the course of a typ23 ical operating cycle of the product; or 

24 (ii) in the case of a clothes washer, a 

25 refrigerator, a dishwasher, a dryer and a 


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1 water heater, reducing a minimum of 50 

2 percent during peak demand as measured 

3 by the tested average wattage over the 

4 course of a typical operating cycle of the 

5 product, provided that the typical oper6 ating cycle of a refrigerator and a water 

7 heater shall be a 24-hour period. 

8 (B) After completion of the analysis re9 quired under section 142(b) of this Act, the 

10 Secretary shall expeditiously promulgate, after 

11 notice and a 30-day public comment period, cri12 teria for what constitutes ‘‘smart grid capa13 bility.’’ 

14 (f) REPORTING.—The Secretary of Energy shall re15 quire, as a condition of receiving a bonus, bounty, or pre16 mium award under this section, that a report containing 

17 the following documentation be provided: 

18 (1) For retailers and distributors, the number 

19 of units sold within each product type, and model20 specific wholesale purchase prices and retail sale 

21 prices, on a monthly basis. 

22 (2) For manufacturers, model-specific energy 

23 efficiency and consumption data. 

24 (3) For manufacturers, on an immediate basis, 

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1 tion changes that affect the energy consumption of 

2 the unit. 

3 (4) The methods used to increase the sales of 

4 qualifying products. 

5 (g) MONITORING AND VERIFICATION PROTOCOLS.— 

6 The Secretary of Energy shall establish monitoring and 

7 verification protocols for energy consumption tests for 

8 each product model and for sales of energy-efficient mod9 els. The Secretary shall estimate actual savings of energy 

10 from the use of Smart Grid capability in appliances for 

11 which premium award payments are made pursuant to 

12 subsection (e) as a function of utility and consumer readi13 ness to utilize such capability. 

14 (h) DISCLOSURE.—The Secretary of Energy may re15 quire that manufacturers, retailers and distributors dis16 close publicly and to consumers their participation in the 

17 program under this section. 

18 (i) COST-EFFECTIVENESS REQUIREMENT.— 

19 (1) REQUIREMENT.—The Secretary of Energy 

20 shall make cost-effectiveness a top priority in design21 ing the program under, and administering, this sec22 tion, except that the cost-effectiveness of providing 

23 premium awards to manufacturers under subsection 

24 (e), in aggregate, may be lower by this measure than 


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1 that of the bonuses and bounties to retailers and 

2 distributors under subsections (c) and (d). 

3 (2) DEFINITIONS.—In this subsection: 

4 (A) COST-EFFECTIVENESS.—The term 

5 ‘‘cost-effectiveness’’ means a measure of aggre6 gate savings in the cost of energy over the life7 time of a product in relation to the cost to the 

8 Secretary of the bonuses, bounties, and pre9 mium awards provided under this section for a 

10 product. 

11 (B) SAVINGS.—The term ‘‘savings’’ means 

12 the cumulative megawatt-hours of electricity or 

13 million British thermal units of other fuels 

14 saved by a product during the projected useful 

15 life of the product, in comparison to projected 

16 energy consumption of the average product in 

17 the same class, taking into consideration the 

18 impact of any documented measures to replace, 

19 retire, and recycle low-efficiency products at the 

20 time of purchase of highly-efficient substitutes. 

21 (j) DEFINITIONS.—In this section— 

22 (1) the term ‘‘distributor’’ mean an individual, 

23 organization, or company that sells products in mul24 tiple lots and not directly to end-users; 


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1 (2) the term ‘‘retailer’’ means an individual, or2 ganization, or company that sells products directly 

3 to end-users; 

4 (3) the term ‘‘manufacturer’’ means an indi5 vidual, organization, or company that transforms 

6 raw materials into mass-producible finished goods; 

7 and 

8 (4) the term ‘‘Superefficient Best-in-Class 

9 Product’’ means a product that— 

10 (A) can be mass produced; and 

11 (B) achieves the highest level of efficiency 

12 that the Secretary of Energy finds can, given 

13 the current state of technology, be produced 

14 and sold commercially to mass-market con15 sumers. 

16 (k) AUTHORIZATION OF APPROPRIATIONS.—There 

17 are authorized to be appropriated $600,000,000 for each 

18 of the fiscal years 2011 through 2013 to the Secretary 

19 of Energy for purposes of this section, and such sums as 

20 may be necessary for subsequent fiscal years. Of funds 

21 appropriated, not more than 10 percent for any fiscal year 

22 may be expended on program administration, and not less 

23 than 40 percent of any funds appropriated during fiscal 

24 years 2011 through 2013 shall be for purposes of sub25 section (e). 


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1 SEC. 215. WATERSENSE. 

2 (a) IN GENERAL.—There is established within the 

3 Environmental Protection Agency a WaterSense program 

4 to identify and promote water efficient products, buildings 

5 and landscapes, and services in order— 

6 (1) to reduce water use; 

7 (2) to reduce the strain on water, wastewater, 

8 and stormwater infrastructure; 

9 (3) to conserve energy used to pump, heat, 

10 transport, and treat water; and 

11 (4) to preserve water resources for future gen12 erations, 

13 through voluntary labeling of, or other forms of commu14 nications about, products, buildings and landscapes, and 

15 services that meet the highest water efficiency and per16 formance standards. 

17 (b) DUTIES.—The Administrator shall— 

18 (1) promote WaterSense labeled products, 

19 buildings and landscapes, and services in the market 

20 place as the preferred technologies and services 

21 for— 

22 (A) reducing water use; and 

23 (B) ensuring product and service perform24 ance; 


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1 (2) work to enhance public awareness of the 

2 WaterSense label through public outreach, edu3 cation, and other means; 

4 (3) establish and maintain performance stand5 ards so that products, buildings and landscapes, and 

6 services labeled with the WaterSense label perform 

7 as well or better than their less efficient counter8 parts; 

9 (4) publicize the need for proper installation 

10 and maintenance of WaterSense products by a li11 censed, and where certification guidelines exist, 

12 WaterSense-certified professional to ensure optimal 

13 performance; 

14 (5) preserve the integrity of the WaterSense 

15 label; 

16 (6) regularly review and, when appropriate, up17 date WaterSense criteria for categories of products, 

18 buildings and landscapes, and services, at least once 

19 every four years; 

20 (7) to the extent practical, regularly estimate 

21 and make available to the public the production and 

22 relative market shares of WaterSense labeled prod23 ucts, buildings and landscapes, and services, at least 

24 annually; 


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1 (8) to the extent practical, regularly estimate 

2 and make available to the public the water and en3 ergy savings attributable to the use of WaterSense 

4 labeled products, buildings and landscapes, and serv5 ices, at least annually; 

6 (9) solicit comments from interested parties and 

7 the public prior to establishing or revising a 

8 WaterSense category, specification, installation cri9 terion, or other criterion (or prior to effective dates 

10 for any such category, specification, installation cri11 terion, or other criterion); 

12 (10) provide reasonable notice to interested par13 ties and the public of any changes (including effec14 tive dates), on the adoption of a new or revised cat15 egory, specification, installation criterion, or other 

16 criterion, along with— 

17 (A) an explanation of changes; and 

18 (B) as appropriate, responses to comments 

19 submitted by interested parties; 

20 (11) provide appropriate lead time (as deter21 mined by the Administrator) prior to the applicable 

22 effective date for a new or significant revision to a 

23 category, specification, installation criterion, or other 

24 criterion, taking into account the timing require25 ments of the manufacturing, marketing, training, 


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1 and distribution process for the specific product, 

2 building and landscape, or service category ad3 dressed; and 

4 (12) identify and, where appropriate, implement 

5 other voluntary approaches in commercial, institu6 tional, residential, municipal, and industrial sectors 

7 to encourage reuse and recycling technologies, im8 prove water efficiency, or lower water use while 

9 meeting, where applicable, the performance stand10 ards established under paragraph (3). 

11 (c) AUTHORIZATION OF APPROPRIATIONS.—There 

12 are authorized to be appropriated $7,500,000 for fiscal 

13 year 2010, $10,000,000 for fiscal year 2011, $20,000,000 

14 for fiscal year 2012, and $50,000,000 for fiscal year 2013 

15 and each year thereafter, adjusted for inflation, to carry 

16 out this section. 

17 SEC. 216. FEDERAL PROCUREMENT OF WATER EFFICIENT 

18 PRODUCTS. 

19 (a) DEFINITIONS.—In this section: 

20 (1) AGENCY.—The term ‘‘agency’’ has the 

21 meaning given that term in section 7902(a) of title 

22 5, United States Code. 

23 (2) WATERSENSE PRODUCT OR SERVICE.—The 

24 term ‘‘WaterSense product or service’’ means a 


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1 product or service that is rated for water efficiency 

2 under the WaterSense program. 

3 (3) WATERSENSE PROGRAM.—The term 

4 ‘‘WaterSense program’’ means the program estab5 lished by section 215 of this Act. 

6 (4) FEMP DESIGNATED PRODUCT.—The term 

7 ‘‘FEMP designated product’’ means a product that 

8 is designated under the Federal Energy Manage9 ment Program of the Department of Energy as 

10 being among the highest 25 percent of equivalent 

11 products for efficiency. 

12 (5) PRODUCT AND SERVICE.—The terms ‘‘prod13 uct’’ and ‘‘service’’ do not include any water con14 suming product or service designed or procured for 

15 combat or combat-related missions. The terms also 

16 exclude products or services already covered by the 

17 Federal procurement regulations established under 

18 section 553 of the National Energy Conservation 

19 Policy Act (42 U.S.C. 8259b). 

20 (b) PROCUREMENT OF WATER EFFICIENT PROD21 UCTS.— 

22 (1) REQUIREMENT.—To meet the requirements 

23 of an agency for a water consuming product or serv24 ice, the head of the agency shall, except as provided 

25 in paragraph (2), procure— 


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1 (A) a WaterSense product or service; or 

2 (B) a FEMP designated product. 

3 A WaterSense plumbing product should preferably, 

4 when possible, be installed by a licensed and, when 

5 WaterSense certification guidelines exist, 

6 WaterSense-certified plumber or mechanical con7 tractor, and a WaterSense irrigation system should 

8 preferably, when possible, be installed, maintained, 

9 and audited by a WaterSense-certified irrigation 

10 professional to ensure optimal performance. 

11 (2) EXCEPTIONS.—The head of an agency is 

12 not required to procure a WaterSense product or 

13 service or FEMP designated product under para14 graph (1) if the head of the agency finds in writing 

15 that— 

16 (A) a WaterSense product or service or 

17 FEMP designated product is not cost-effective 

18 over the life of the product, taking energy and 

19 water cost savings into account; or 

20 (B) no WaterSense product or service or 

21 FEMP designated product is reasonably avail22 able that meets the functional requirements of 

23 the agency. 

24 (3) PROCUREMENT PLANNING.—The head of an 

25 agency shall incorporate into the specifications for 


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1 all procurements involving water consuming products 

2 and systems, including guide specifications, project 

3 specifications, and construction, renovation, and 

4 services contracts that include provision of water 

5 consuming products and systems, and into the fac6 tors for the evaluation of offers received for the pro7 curement, criteria used for rating WaterSense prod8 ucts and services and FEMP designated products. 

9 The head of an agency shall consider, to the max10 imum extent practicable, additional measures for re11 ducing agency water consumption, including water 

12 reuse technologies, leak detection and repair, and 

13 use of waterless products that perform similar func14 tions to existing water-consuming products. 

15 (c) REGULATIONS.—Not later than 180 days after 

16 the date of enactment of this Act, the Secretary of Energy, 

17 working in coordination with the Administrator, shall 

18 issue guidelines to carry out this section. 

19 SEC. 217. WATER EFFICIENT PRODUCT REBATE PROGRAMS. 

20 (a) DEFINITIONS.—In this section: 

21 (1) ELIGIBLE STATE.—The term ‘‘eligible 

22 State’’ means a State that meets the requirements 

23 of subsection (b). 

24 (2) RESIDENTIAL WATER EFFICIENT PRODUCT

25 OR SERVICE.—The term ‘‘residential water efficient 


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1 product or service’’ means a product or service for 

2 a residence or its landscape that is rated for water 

3 efficiency and performance— 

4 (A) by the WaterSense program, where a 

5 WaterSense specification does not exist; or 

6 (B) by a State program and approved by 

7 the Administrator. 

8 Categories of water efficient products and services 

9 may include faucets, irrigation technologies and 

10 services, point-of-use water treatment devices, reuse 

11 and recycling technologies, toilets, and showerheads. 

12 (3) STATE PROGRAM.—The term ‘‘State pro13 gram’’ means a State program for administering re14 bates or vouchers for consumer purchase of water ef15 ficient products and services as described in sub16 section (b)(1). 

17 (4) WATERSENSE PROGRAM.—The term 

18 ‘‘WaterSense program’’ means the program estab19 lished by section 215 of this Act. 

20 (b) ELIGIBLE STATES.—A State shall be eligible to 

21 receive an allocation under subsection (c) if the State— 

22 (1) establishes (or has established) a State pro23 gram to provide rebates or vouchers to residential 

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1 cient products or services to replace used products 

2 of the same type; 

3 (2) submits an application for the allocation at 

4 such time, in such form, and containing such infor5 mation as the Administrator may require; and 

6 (3) provides assurances satisfactory to the Ad7 ministrator that the State will use the allocation to 

8 supplement, but not supplant, funds made available 

9 to carry out the State program. 

10 (c) AMOUNT OF ALLOCATIONS.— 

11 (1) IN GENERAL.—Subject to paragraph (2), 

12 for each fiscal year, the Administrator shall allocate 

13 to each eligible State to carry out subsection (d) an 

14 amount equal to the product obtained by multiplying 

15 the amount made available under subsection (g) for 

16 the fiscal year by the ratio that the population of the 

17 State in the most recent calendar year for which 

18 data are available bears to the total population of all 

19 eligible States in that calendar year. 

20 (2) MINIMUM ALLOCATIONS.—For each fiscal 

21 year, the amounts allocated under this subsection 

22 shall be adjusted proportionately so that no eligible 

23 State is allocated a sum that is less than an amount 

24 determined by the Administrator. 


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1 (d) USE OF ALLOCATED FUNDS.—Funds allocated to 

2 a State under subsection (c) may be used to pay up to 

3 50 percent of the cost of establishing and carrying out 

4 a State program. 

5 (e) FIXTURE RECYCLING.—States are encouraged to 

6 promote or implement fixture recycling programs to man7 age the disposal of older fixtures replaced due to the re8 bate program under this section. 

9 (f) ISSUANCE OF REBATES.—Rebates or vouchers 

10 may be provided to residential consumers that meet the 

11 requirements of the State program. The State may issue 

12 all rebates or vouchers directly to residential consumers 

13 or, with approval of the Administrator, delegate some or 

14 all rebate and voucher administration to other organiza15 tions including, but not limited to, local governments, mu16 nicipal water authorities, and water utilities. The amount 

17 of a rebate or voucher shall be determined by the State, 

18 taking into consideration— 

19 (1) the amount of the allocation to the State 

20 under subsection (c); 

21 (2) the amount of any Federal or State tax in22 centive available for the purchase of the residential 

23 water efficient product or service; 


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1 (3) the amount necessary to change consumer 

2 behavior to purchase water efficient products and 

3 services; and 

4 (4) the consumer expenditures for onsite prepa5 ration, assembly, and original installation of the 

6 product. 

7 (g) AUTHORIZATION OF APPROPRIATIONS.—There 

8 are authorized to be appropriated to the Administrator to 

9 carry out this section $50,000,000 for each of the fiscal 

10 years 2010 and 2011, $75,000,000 for fiscal year 2012, 

11 $100,000,000 for fiscal year 2013, and $150,000,000 for 

12 fiscal year 2014 and each year thereafter, adjusted for in13 flation. 

14 SEC. 218. CERTIFIED STOVES PROGRAM. 

15 (a) DEFINITIONS.—In this section: 

16 (1) AGENCY.—The term ‘‘Agency’’ means the 

17 Environmental Protection Agency. 

18 (2) WOOD STOVE OR PELLET STOVE.—The 

19 term ‘‘wood stove or pellet stove’’ means a wood 

20 stove, pellet stove, or fireplace insert that uses wood 

21 or pellets for fuel. 

22 (3) CERTIFIED STOVE.—The term ‘‘certified 

23 stove’’ means a wood stove or pellet stove that meets 

24 the standards of performance for new residential 

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1 chapter C of chapter I of title 40, Code of Federal 

2 Regulations (or successor regulations), as certified 

3 by the Administrator. Pellet stoves and fireplace in4 serts using pellets for fuel that are exempt from 

5 testing by the Administrator but meet the same 

6 standards of performance as wood stoves are consid7 ered certified for the purposes of this section. 

8 (4) ELIGIBLE ENTITY.—The term ‘‘eligible enti9 ty’’ means— 

10 (A) a State, a local government, or a feder11 ally recognized Indian tribe; 

12 (B) Alaskan Native villages or regional or 

13 village corporations (as defined in, or estab14 lished under, the Alaskan Native Claims Settle15 ment Act (43 U.S.C. 1601 et seq.)); and 

16 (C) a nonprofit organization or institution 

17 that— 

18 (i) represents or provides pollution re19 duction or educational services relating to 

20 wood smoke minimization to persons, orga21 nizations, or communities; or 

22 (ii) has, as its principal purpose, the 

23 promotion of air quality or energy effi24 ciency. 


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1 (b) ESTABLISHMENT.—The Administrator shall es2 tablish and carry out a program to assist in the replace3 ment of wood stoves or pellet stoves that do not meet the 

4 standards of performance referred to in subsection (a)(4) 

5 by— 

6 (1) requiring that each wood stove or pellet 

7 stove sold in the United States on and after the date 

8 of enactment of this Act meet the standards of per9 formance referred to in subsection (a)(4); 

10 (2) requiring that no wood stove or pellet stove 

11 replaced under this program is sold or returned to 

12 active service, but that it is instead destroyed and 

13 recycled to the maximum extent feasible; 

14 (3) providing funds to an eligible entity to re15 place a wood stove or pellet stove that does not meet 

16 the standards of performance in subsection (a)(4) 

17 with a certified stove, including funds to pay for— 

18 (A) installation of a replacement certified 

19 stove; and 

20 (B) necessary replacement of or repairs to 

21 ventilation, flues, chimneys, or other relevant 

22 items necessary for safe installation of a re23 placement certified stove; 

24 (4) in addition to any funds that may be appro25 priated for the program under this subsection, using 


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1 existing Federal, State, and local programs and in2 centives, to the greatest extent practicable; 

3 (5) prioritizing the replacement of wood stoves 

4 or pellet stoves manufactured before July 1, 1990; 

5 and 

6 (6) carrying out such other activities as the Ad7 ministrator determines appropriate to facilitate the 

8 replacement of wood stoves or pellet stoves that do 

9 not meet the standards of performance referred to in 

10 subsection (a)(3). 

11 (c) REGULATIONS.—The Administrator may promul12 gate such regulations as are necessary to carry out the 

13 program established under subsection (b). 

14 (d) FUNDING.— 

15 (1) AUTHORIZATION OF APPROPRIATIONS.— 

16 There are authorized to be appropriated to carry out 

17 the program under this section $20,000,000 for the 

18 period of fiscal years 2010 through 2014. 

19 (2) DESIGNATED USE.—Of amounts appro20 priated pursuant to this subsection— 

21 (A) 25 percent shall be designated for use 

22 to carry out the program under this section on 

23 lands held in trust for the benefit of a federally 

24 recognized Indian tribe; 


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1 (B) 3 percent shall be designated for use 

2 to carry out the program under this section in 

3 Alaskan Native villages or regional or village 

4 corporations (as defined in, or established 

5 under, the Alaskan Native Claims Settlement 

6 Act (43 U.S.C. 1601 et seq.)); and 

7 (C) 72 percent shall be designated for use 

8 to carry out the program under this section na9 tionwide. 

10 (3) REGULATORY PROGRAMS.— 

11 (A) IN GENERAL.—No grant or loan pro12 vided under this section shall be used to fund 

13 the costs of emissions reductions that are man14 dated under Federal, State, or local law. 

15 (B) MANDATED.—For purposes of sub16 paragraph (A), voluntary or elective emission 

17 reduction measures shall not be considered 

18 ‘‘mandated’’, regardless of whether the reduc19 tions are included in the implementation plan of 

20 a State. 

21 (e) EPA AUTHORITY TO ACCEPT WOOD STOVE OR

22 PELLET STOVE REPLACEMENT SUPPLEMENTAL ENVI23 RONMENTAL PROJECTS.— 

24 (1) IN GENERAL.—The Administrator may ac25 cept (notwithstanding sections 3302 and 1301 of 


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1 title 31, United States Code) wood stove or pellet 

2 stove replacement Supplemental Environmental 

3 Projects if such projects, as part of a settlement of 

4 any alleged violation of environmental law— 

5 (A) protect human health or the environ6 ment; 

7 (B) are related to the underlying alleged 

8 violation; 

9 (C) do not constitute activities that the de10 fendant would otherwise be legally required to 

11 perform; and 

12 (D) do not provide funds for the staff of 

13 the Agency or for contractors to carry out the 

14 Agency’s internal operations. 

15 (2) CERTIFICATION.—In any settlement agree16 ment regarding an alleged violation of environmental 

17 law in which a defendant agrees to perform a wood 

18 stove or pellet stove replacement Supplemental Envi19 ronmental Project, the Administrator shall require 

20 the defendant to include in the settlement docu21 ments a certification under penalty of law that the 

22 defendant would have agreed to perform a com23 parably valued, alternative project other than a wood 

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1 cluded by law from accepting a wood stove or pellet 

2 stove replacement Supplemental Environmental 

3 Project. A failure by the Administrator to include 

4 this language in such a settlement agreement shall 

5 not create a cause of action against the United 

6 States under the Clean Air Act or any other law or 

7 create a basis for overturning a settlement agree8 ment entered into by the United States. 

9 SEC. 219. ENERGY STAR STANDARDS. 

10 (a) ENERGY STAR.—Section 324A(c) of the Energy 

11 Policy and Conservation Act is amended— 

12 (1) in paragraph (6)(B), by striking ‘‘and’’ 

13 after the semicolon at the end; 

14 (2) in paragraph (7), by striking the period at 

15 the end and inserting a semicolon; and 

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

17 ‘‘(8) not later than 18 months after the date of 

18 enactment of this paragraph, establish and imple19 ment a rating system for products identified as En20 ergy Star products pursuant to this section to pro21 vide consumers with the most helpful information on 

22 the relative energy efficiency of those products, un23 less the Administrator and the Secretary commu24 nicate to Congress that establishing such a system 


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1 would diminish the value of the Energy Star brand 

2 to consumers; 

3 ‘‘(9)(A) review the Energy Star product criteria 

4 for the 10 product models in each product category 

5 with the greatest energy consumption at least once 

6 every 3 years; and 

7 ‘‘(B) based on the review, update and publish 

8 the Energy Star product criteria for each such cat9 egory, as necessary; and 

10 ‘‘(10) require periodic verification of compliance 

11 with the Energy Star product criteria by products 

12 identified as Energy Star products pursuant to this 

13 section, including— 

14 ‘‘(A) purchase and testing of products 

15 from the market; or 

16 ‘‘(B) other appropriate testing and compli17 ance approaches.’’. 

18 (b) AUTHORIZATION OF APPROPRIATIONS.—There 

19 are authorized to be appropriated to carry out the amend20 ments made by this section $5,000,000 for fiscal year 

21 2010 and for each fiscal year thereafter. 


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1 Subtitle C—Transportation 

2 Efficiency 

3 SEC. 221. EMISSIONS STANDARDS. 

4 Title VIII of the Clean Air Act, as added by section 

5 331 of this Act, is amended by inserting after part A the 

6 following new part: 

7 ‘‘PART B—MOBILE SOURCES 

8 ‘‘SEC. 821. GREENHOUSE GAS EMISSION STANDARDS FOR 

9 MOBILE SOURCES. 

10 ‘‘(a) NEW MOTOR VEHICLES AND NEW MOTOR VE11 HICLE ENGINES.—(1) Pursuant to section 202(a)(1), by 

12 December 31, 2010, the Administrator shall promulgate 

13 standards applicable to emissions of greenhouse gases 

14 from new heavy-duty motor vehicles or new heavy-duty 

15 motor vehicle engines, excluding such motor vehicles cov16 ered by the Tier II standards (as established by the Ad17 ministrator as of the date of the enactment of this sec18 tion). The Administrator may revise these standards from 

19 time to time. 

20 ‘‘(2) Regulations issued under section 202(a)(1) ap21 plicable to emissions of greenhouse gases from new heavy22 duty motor vehicles or new heavy-duty motor vehicle en23 gines, excluding such motor vehicles covered by the Tier 

24 II standards (as established by the Administrator as of 

25 the date of the enactment of this section), shall contain 


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1 standards that reflect the greatest degree of emissions re2 duction achievable through the application of technology 

3 which the Administrator determines will be available for 

4 the model year to which such standards apply, giving ap5 propriate consideration to cost, energy, and safety factors 

6 associated with the application of such technology. Any 

7 such regulations shall take effect after such period as the 

8 Administrator finds necessary to permit the development 

9 and application of the requisite technology, and, at a min10 imum, shall apply for a period no less than 3 model years 

11 beginning no earlier than the model year commencing 4 

12 years after such regulations are promulgated. 

13 ‘‘(3) Regulations issued under section 202(a)(1) ap14 plicable to emissions of greenhouse gases from new heavy15 duty motor vehicles or new heavy-duty motor vehicle en16 gines, excluding such motor vehicles covered by the Tier 

17 II standards (as established by the Administrator as of 

18 the date of the enactment of this section), shall supersede 

19 and satisfy any and all of the rulemaking and compliance 

20 requirements of section 32902(k) of title 49, United 

21 States Code. 

22 ‘‘(4) Other than as specifically set forth in paragraph 

23 (3) of this subsection, nothing in this section shall affect 

24 or otherwise increase or diminish the authority of the Sec25 retary of Transportation to adopt regulations to improve 


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1 the overall fuel efficiency of the commercial goods move2 ment system. 

3 ‘‘(b) NONROAD VEHICLES AND ENGINES.—(1) Pur4 suant to section 213(a)(4) and (5), the Administrator 

5 shall identify those classes or categories of new nonroad 

6 vehicles or engines, or combinations of such classes or cat7 egories, that, in the judgment of the Administrator, both 

8 contribute significantly to the total emissions of green9 house gases from nonroad engines and vehicles, and pro10 vide the greatest potential for significant and cost-effective 

11 reductions in emissions of greenhouse gases. The Adminis12 trator shall promulgate standards applicable to emissions 

13 of greenhouse gases from these new nonroad engines or 

14 vehicles by December 31, 2012. The Administrator shall 

15 also promulgate standards applicable to emissions of 

16 greenhouse gases for such other classes and categories of 

17 new nonroad vehicles and engines as the Administrator de18 termines appropriate and in the timeframe the Adminis19 trator determines appropriate. The Administrator shall 

20 base such determination, among other factors, on the rel21 ative contribution of greenhouse gas emissions, and the 

22 costs for achieving reductions, from such classes or cat23 egories of new nonroad engines and vehicles. The Adminis24 trator may revise these standards from time to time. 


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1 ‘‘(2) Standards under section 213(a)(4) and (5) ap2 plicable to emissions of greenhouse gases from those class3 es or categories of new nonroad engines or vehicles identi4 fied in the first sentence of paragraph (1) of this sub5 section, shall achieve the greatest degree of emissions re6 duction achievable based on the application of technology 

7 which the Administrator determines will be available at 

8 the time such standards take effect, taking into consider9 ation cost, energy, and safety factors associated with the 

10 application of such technology. Any such regulations shall 

11 take effect at the earliest possible date after such period 

12 as the Administrator finds necessary to permit the devel13 opment and application of the requisite technology, giving 

14 appropriate consideration to the cost of compliance within 

15 such period, the applicable compliance dates for other 

16 standards, and other appropriate factors, including the pe17 riod of time appropriate for the transfer of applicable tech18 nology from other applications, including motor vehicles, 

19 and the period of time in which previously promulgated 

20 regulations have been in effect. 

21 ‘‘(3) For purposes of this section and standards 

22 under section 213(a)(4) or (5) applicable to emissions of 

23 greenhouse gases, the term ‘nonroad engines and vehicles’ 

24 shall include non-internal combustion engines and the ve25 hicles these engines power (such as electric engines and 


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1 electric vehicles), for those non-internal combustion en2 gines and vehicles which would be in the same category 

3 and have the same uses as nonroad engines and vehicles 

4 that are powered by internal combustion engines. 

5 ‘‘(c) AVERAGING, BANKING, AND TRADING OF EMIS6 SIONS CREDITS.—In establishing standards applicable to 

7 emissions of greenhouse gases pursuant to this section and 

8 sections 202(a), 213(a)(4) and (5), and 231(a), the Ad9 ministrator may establish provisions for averaging, bank10 ing, and trading of greenhouse gas emissions credits with11 in or across classes or categories of motor vehicles and 

12 motor vehicle engines, nonroad vehicles and engines (in13 cluding marine vessels), and aircraft and aircraft engines, 

14 to the extent the Administrator determines appropriate 

15 and considering the factors appropriate in setting stand16 ards under those sections. Such provisions may include 

17 reasonable and appropriate provisions concerning genera18 tion, banking, trading, duration, and use of credits. 

19 ‘‘(d) REPORTS.—The Administrator shall, from time 

20 to time, submit a report to Congress that projects the 

21 amount of greenhouse gas emissions from the transpor22 tation sector, including transportation fuels, for the years 

23 2030 and 2050, based on the standards adopted under 

24 this section. 


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1 ‘‘(e) GREENHOUSE GASES.—Notwithstanding the 

2 provisions of section 711, hydrofluorocarbons shall be con3 sidered a greenhouse gas for purposes of this section.’’. 

4 SEC. 222. GREENHOUSE GAS EMISSIONS REDUCTIONS 

5 THROUGH TRANSPORTATION EFFICIENCY. 

6 (a) ENVIRONMENTAL PROTECTION AGENCY.—Title 

7 VIII of the Clean Air Act, as added by section 331 of this 

8 Act, is further amended by inserting after part C the fol9 lowing new part: 

10 ‘‘PART D—TRANSPORTATION EMISSIONS 

11 ‘‘SEC. 841. GREENHOUSE GAS EMISSIONS REDUCTIONS 

12 THROUGH TRANSPORTATION EFFICIENCY. 

13 ‘‘(a) IN GENERAL.—The Administrator, in consulta14 tion with the Secretary of Transportation, shall promul15 gate, and update from time to time, regulations to estab16 lish national transportation-related greenhouse gas emis17 sions reduction goals, standardized models and methodolo18 gies for use in developing surface transportation-related 

19 greenhouse gas emissions reduction targets pursuant to 

20 sections 134 and 135 of title 23 of the United States Code 

21 and methods for collection of data on transportation-re22 lated greenhouse gas emissions. Such goals shall be com23 mensurate with the emissions reductions goals established 

24 under the American Clean Energy and Security Act of 

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1 gies, the Administrator shall consult with States and met2 ropolitan planning organizations and may utilize existing 

3 models and methodologies. 

4 ‘‘(b) TIMING.—The Administrator shall— 

5 ‘‘(1) publish proposed regulations under sub6 section (a) not later than 12 months after the date 

7 of enactment of this section; and 

8 ‘‘(2) promulgate final regulations under sub9 section (a) not later than 18 months after the date 

10 of enactment of this section. 

11 ‘‘(c) ASSESSMENT.—At least every 6 years after pro12 mulgating final regulations under subsection (a), the Ad13 ministrator, jointly with the Secretary of Transportation, 

14 shall assess current and projected progress in reducing na15 tional transportation-related greenhouse gas emissions. 

16 The assessment shall examine the contributions to emis17 sions reductions attributable to improvements in vehicle 

18 efficiency, greenhouse gas performance of transportation 

19 fuels, increased efficiency in utilizing transportation sys20 tems and the effects of local and State planning.’’. 

21 (b) METROPOLITAN PLANNING ORGANIZATIONS.— 

22 Section 134 of title 23 of the United States Code is 

23 amended as follows: 

24 (1) In subsection (a)(1)— 


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1 (A) by striking ‘‘minimizing’’ and inserting 

2 ‘‘reducing’’; and 

3 (B) by inserting ‘‘, reliance on oil, impacts 

4 on the environment, transportation-related 

5 greenhouse gas emissions’’ after ‘‘consump6 tion’’. 

7 (2) In subsection (h)(1)(E)— 

8 (A) by inserting ‘‘sustainability and liv9 ability, reduce surface transportation-related 

10 greenhouse gas emissions and reliance on oil, 

11 adapt to the effects of climate change,’’ after 

12 ‘‘energy conservation’’; 

13 (B) by inserting ‘‘and public health’’ after 

14 ‘‘quality of life’’; and 

15 (C) by inserting ‘‘, including housing and 

16 land use patterns’’ after ‘‘development pat17 terns’’. 

18 (3) In subsection (i)(4)(A) by inserting ‘‘air 

19 quality, public health, housing, transportation,’’ 

20 after ‘‘conservation,’’. 

21 (4) In subsection (k) by inserting at the end the 

22 following new paragraph: 

23 ‘‘(6) EMISSIONS REDUCTION PROCESS.— 

24 ‘‘(A) IN GENERAL.—Within a metropolitan 

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1 ment area, the transportation planning process 

2 under this section shall address transportation3 related greenhouse gas emissions by including 

4 emission reduction targets and strategies. 

5 ‘‘(B) ESTABLISHMENT OF EMISSIONS RE6 DUCTION TARGETS AND STRATEGIES.— 

7 ‘‘(i) IN GENERAL.—Not later than one 

8 year after the promulgation of the final 

9 regulations required under section 841 of 

10 the Clean Air Act, each metropolitan plan11 ning organization shall develop surface 

12 transportation-related greenhouse gas 

13 emission reduction targets, as well as 

14 strategies to meet such targets, as part of 

15 the transportation planning process under 

16 this section. If more than one metropolitan 

17 planning organization has been designated 

18 within a metropolitan planning area serv19 ing a transportation management area, 

20 each such metropolitan planning organiza21 tion shall work cooperatively with other 

22 such organization to develop the surface 

23 transportation-related greenhouse gas 

24 emission reduction targets required under 

25 this subparagraph. 


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1 ‘‘(ii) MINIMUM REQUIREMENTS.— 

2 Each metropolitan planning organization 

3 that develops targets and strategies re4 quired under clause (i) shall demonstrate 

5 progress in stabilizing and reducing trans6 portation-related greenhouse gas emissions 

7 in each metropolitan planning area serving 

8 a surface transportation management area. 

9 The targets and strategies shall, at a min10 imum— 

11 ‘‘(I) be based on the models and 

12 methodologies established in the final 

13 regulations required under section 

14 841 of the Clean Air Act; 

15 ‘‘(II) address sources of surface 

16 transportation-related greenhouse gas 

17 emissions and contribute to achieve18 ment of the national transportation19 related greenhouse gas emissions re20 duction goals; 

21 ‘‘(III) include efforts to increase 

22 public transportation ridership; and 

23 ‘‘(IV) include efforts to increase 

24 walking, bicycling, and other forms of 

25 nonmotorized transportation. 


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1 ‘‘(C) PUBLIC NOTICE.—Each metropolitan 

2 planning organization shall make its emission 

3 reduction targets and strategies, and an anal4 ysis of the anticipated effects thereof, available 

5 to the public through its Web site. 

6 ‘‘(D) ENFORCEMENT.—If the Secretary 

7 finds that a metropolitan planning organization 

8 has failed to develop, submit or publish its 

9 emission reduction targets and strategies, the 

10 Secretary shall not certify that the require11 ments of this section are met with respect to 

12 the metropolitan planning process of such orga13 nization.’’. 

14 (c) STATES.—Section 135 of title 23 of the United 

15 States Code is amended as follows: 

16 (1) In subsection (d)(1)(E)— 

17 (A) by inserting ‘‘sustainability and liv18 ability, reduce surface transportation-related 

19 greenhouse gas emissions and reliance on oil, 

20 adapt to the effects of climate change,’’ after 

21 ‘‘energy conservation’’; 

22 (B) by inserting ‘‘and public health’’ after 

23 ‘‘quality of life’’; and 


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1 (C) by inserting ‘‘, including housing and 

2 land use patterns’’ after ‘‘development pat3 terns’’. 

4 (2) In subsection (f)(2)(D)(i) by inserting ‘‘air 

5 quality, public health, housing, transportation,’’ 

6 after ‘‘conservation,’’. 

7 (3) In subsection (f) by inserting at the end the 

8 following new paragraph: 

9 ‘‘(9) EMISSIONS REDUCTION PROCESS.— 

10 ‘‘(A) IN GENERAL.—Within a State, the 

11 transportation planning process under this sec12 tion shall address transportation-related green13 house gas emissions by including emission re14 duction targets and strategies. 

15 ‘‘(B) ESTABLISHMENT OF EMISSIONS RE16 DUCTION TARGETS AND STRATEGIES.— 

17 ‘‘(i) IN GENERAL.—Not later than one 

18 year after the promulgation of the final 

19 regulations required under section 841 of 

20 the Clean Air Act, each State shall develop 

21 surface transportation-related greenhouse 

22 gas emission reduction targets, as well as 

23 strategies to meet such targets, as part of 

24 the transportation planning process under 

25 this section. 


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1 ‘‘(ii) MINIMUM REQUIREMENTS.— 

2 Each State that develops targets and strat3 egies required under clause (i) shall dem4 onstrate progress in stabilizing and reduc5 ing transportation-related greenhouse gas 

6 emissions in such State. The targets and 

7 strategies shall, at a minimum, 

8 ‘‘(I) be based on the models and 

9 methodologies established in the final 

10 regulations required under section 

11 841 of the Clean Air Act; 

12 ‘‘(II) address sources of surface 

13 transportation-related greenhouse gas 

14 emissions and contribute to achieve15 ment of the national transportation16 related greenhouse gas emissions re17 duction goals; 

18 ‘‘(III) include efforts to increase 

19 public transportation ridership; and 

20 ‘‘(IV) include efforts to increase 

21 walking, bicycling, and other forms of 

22 nonmotorized transportation. 

23 ‘‘(D) PUBLIC NOTICE.—Each State shall 

24 make its emission reduction targets and strate25 gies, and an analysis of the anticipated effects 


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1 thereof, available to the public through its Web 

2 site. 

3 ‘‘(E) ENFORCEMENT.—If the Secretary 

4 finds that a State has failed to develop, submit 

5 or publish its emission reduction targets and 

6 strategies, the Secretary shall not certify that 

7 the requirements of this section are met with 

8 respect to the statewide planning process of 

9 such State.’’. 

10 (d) DEPARTMENT OF TRANSPORTATION.—The Sec11 retary of Transportation shall establish appropriate re12 quirements, including performance measures, to ensure 

13 that transportation plans developed under sections 134 

14 and 135 of title 23 of the United States Code sufficiently 

15 meet the requirements of this section, including achieving 

16 progress towards national transportation-related green17 house gas emissions reduction goals. 

18 SEC. 223. SMARTWAY TRANSPORTATION EFFICIENCY PRO19 GRAM. 

20 Part B of title VIII of the Clean Air Act, as added 

21 by section 221 of this Act is amended by adding after sec22 tion 821 the following section: 


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1 ‘‘SEC. 822. SMARTWAY TRANSPORTATION EFFICIENCY PRO2 GRAM. 

3 ‘‘(a) IN GENERAL.—There is established within the 

4 Environmental Protection Agency a SmartWay Transport 

5 Program to quantify, demonstrate, and promote the bene6 fits of technologies, products, fuels, and operational strate7 gies that reduce petroleum consumption, air pollution, and 

8 greenhouse gas emissions from the mobile source sector. 

9 ‘‘(b) GENERAL DUTIES.—Under the program estab10 lished under this section, the Administrator shall carry out 

11 each of the following: 

12 ‘‘(1) Development of measurement protocols to 

13 evaluate the energy consumption and greenhouse gas 

14 impacts from technologies and strategies in the mo15 bile source sector, including those for passenger 

16 transport and goods movement. 

17 ‘‘(2) Development of qualifying thresholds for 

18 certifying, verifying, or designating energy-efficient, 

19 low-greenhouse gas SmartWay technologies and 

20 strategies for each mode of passenger transportation 

21 and goods movement. 

22 ‘‘(3) Development of partnership and recogni23 tion programs to promote best practices and drive 

24 demand for energy-efficient, low-greenhouse gas 

25 transportation performance. 


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1 ‘‘(4) Promotion of the availability of, and en2 couragement of the adoption of, SmartWay certified 

3 or verified technologies and strategies, and publica4 tion of the availability of financial incentives, such 

5 as assistance from loan programs and other Federal 

6 and State incentives. 

7 ‘‘(c) SMARTWAY TRANSPORT FREIGHT PARTNER8 SHIP.—The Administrator shall establish a SmartWay 

9 Transport Freight Partnership program with shippers and 

10 carriers of goods to promote energy-efficient, low-green11 house gas transportation. In carrying out such partner12 ship, the Administrator shall undertake each of the fol13 lowing: 

14 ‘‘(1) Certification of the energy and greenhouse 

15 gas performance of participating freight carriers, in16 cluding those operating rail, trucking, marine, and 

17 other goods movement operations. 

18 ‘‘(2) Publication of a comprehensive energy and 

19 greenhouse gas performance index of freight modes 

20 (including rail, trucking, marine, and other modes of 

21 transporting goods) and individual freight companies 

22 so that shippers can choose to deliver their goods 

23 more efficiently. 

24 ‘‘(3) Development of tools for— 


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1 ‘‘(A) carriers to calculate their energy and 

2 greenhouse gas performance; and 

3 ‘‘(B) shippers to calculate the energy and 

4 greenhouse gas impacts of moving their prod5 ucts and to evaluate the relative impacts from 

6 transporting their goods by different modes and 

7 corporate carriers. 

8 ‘‘(4) Provision of recognition opportunities for 

9 participating shipper and carrier companies dem10 onstrating advanced practices and achieving superior 

11 levels of greenhouse gas performance. 

12 ‘‘(d) IMPROVING FREIGHT GREENHOUSE GAS PER13 FORMANCE DATABASES.—The Administrator shall, in co14 ordination with other appropriate agencies, define and col15 lect data on the physical and operational characteristics 

16 of the Nation’s truck population, with special emphasis on 

17 data related to energy efficiency and greenhouse gas per18 formance to inform the performance index published 

19 under subsection (c)(2) of this section, and other means 

20 of goods transport as necessary, at least every 5 years. 

21 ‘‘(e) ESTABLISHMENT OF FINANCING PROGRAM.— 

22 The Administrator shall establish a SmartWay Financing 

23 Program to competitively award funding to eligible entities 

24 identified by the Administrator in accordance with the 

25 program requirements in subsection (g). 


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1 ‘‘(f) PURPOSE.—Under the SmartWay Financing 

2 Program, eligible entities shall— 

3 ‘‘(1) use funds awarded by the Administrator to 

4 provide flexible loan and lease terms that increase 

5 approval rates or lower the costs of loans and leases 

6 in accordance with guidance developed by the Ad7 ministrator; and 

8 ‘‘(2) make such loans and leases available to 

9 public and private entities for the purpose of adopt10 ing low-greenhouse gas technologies or strategies for 

11 the mobile source sector that are designated by the 

12 Administrator. 

13 ‘‘(g) PROGRAM REQUIREMENTS.—The Administrator 

14 shall determine program design elements and require15 ments, including— 

16 ‘‘(1) the type of financial mechanism with 

17 which to award funding, in the form of grants or 

18 contracts; 

19 ‘‘(2) the designation of eligible entities to re20 ceive funding, including State, tribal, and local gov21 ernments, regional organizations comprised of gov22 ernmental units, nonprofit organizations, or for-prof23 it companies; 

24 ‘‘(3) criteria for evaluating applications from el25 igible entities, including anticipated— 


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1 ‘‘(A) cost-effectiveness of loan or lease pro2 gram on a metric-ton-of-greenhouse gas-saved3 per-dollar basis; 

4 ‘‘(B) ability to promote the loan or lease 

5 program and associated technologies and strate6 gies to the target audience; and 

7 ‘‘(4) reporting requirements for entities that re8 ceive awards, including— 

9 ‘‘(A) actual cost-effectiveness and green10 house gas savings from the loan or lease pro11 gram based on a methodology designated by the 

12 Administrator; 

13 ‘‘(B) the total number of applications and 

14 number of approved applications; and 

15 ‘‘(C) terms granted to loan and lease re16 cipients compared to prevailing market prac17 tices. 

18 ‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—Such 

19 sums as necessary are authorized to be appropriated to 

20 the Administrator to carry out this section.’’. 

21 SEC. 224. STATE VEHICLE FLEETS. 

22 Section 507(o) of the Energy Policy Act of 1992 (42 

23 U.S.C. 13257) is amended by adding the following new 

24 paragraph at the end thereof: 


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1 ‘‘(3) The Secretary shall revise the rules under this 

2 subsection with respect to the types of alternative fueled 

3 vehicles required for compliance with this subsection to en4 sure those rules are consistent with any guidance issued 

5 pursuant to section 303 of this Act.’’. 

6 Subtitle D—Industrial Energy 

7 Efficiency Programs 

8 SEC. 241. INDUSTRIAL PLANT ENERGY EFFICIENCY STAND9 ARDS. 

10 The Secretary of Energy shall continue to support 

11 the development of the American National Standards In12 stitute (ANSI) voluntary industrial plant energy efficiency 

13 certification program, pending International Standards 

14 Organization (ISO) consensus standard 50001, and other 

15 related ANSI/ISO standards. In addition, the Department 

16 shall undertake complementary activities through the De17 partment of Energy’s Industry Technologies Program that 

18 support the voluntary implementation of such standards 

19 by manufacturing firms. There are authorized to be appro20 priated to the Secretary such sums as are necessary to 

21 carry out these activities. The Secretary shall report to 

22 Congress on the status of standards development and 

23 plans for further standards development pursuant to this 

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1 actment of this Act, and shall prepare a second such re2 port 18 months thereafter. 

3 SEC. 242. ELECTRIC AND THERMAL WASTE ENERGY RECOV4 ERY AWARD PROGRAM. 

5 (a) ELECTRIC AND THERMAL WASTE ENERGY RE6 COVERY AWARDS.—The Secretary of Energy shall estab7 lish a program to make monetary awards to the owners 

8 and operators of new and existing electric energy genera9 tion facilities or thermal energy production facilities using 

10 fossil or nuclear fuel, to encourage them to use innovative 

11 means of recovering any thermal energy that is a poten12 tially useful byproduct of electric power generation or 

13 other processes to— 

14 (1) generate additional electric energy; or 

15 (2) make sales of thermal energy not used for 

16 electric generation, in the form of steam, hot water, 

17 chilled water, or desiccant regeneration, or for other 

18 commercially valid purposes. 

19 (b) AMOUNT OF AWARDS.— 

20 (1) ELIGIBILITY.—Awards shall be made under 

21 subsection (a) only for the use of innovative means 

22 that achieve net energy efficiency at the facility con23 cerned significantly greater than the current stand24 ard technology in use at similar facilities. 


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1 (2) AMOUNT.—The amount of an award made 

2 under subsection (a) shall equal an amount up to 

3 the value of 25 percent of the energy projected to be 

4 recovered or generated during the first 5 years of 

5 operation of the facility using the innovative energy 

6 recovery method, or such lesser amount that the 

7 Secretary determines to be the minimum amount 

8 that can cost-effectively stimulate such innovation. 

9 (3) LIMITATION.—No person may receive an 

10 award under this section if a grant under the waste 

11 energy incentive grant program under section 373 of 

12 the Energy Policy and Conservation Act (42 U.S.C. 

13 6343) is made for the same energy savings resulting 

14 from the same innovative method. 

15 (c) REGULATORY STATUS.—The Secretary of Energy 

16 shall— 

17 (1) assist State regulatory commissions to iden18 tify and make changes in State regulatory programs 

19 for electric utilities to provide appropriate regulatory 

20 status for thermal energy byproduct businesses of 

21 regulated electric utilities to encourage those utilities 

22 to enter businesses making the sales referred to in 

23 subsection (a)(2); and 


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1 (2) encourage self-regulated utilities to enter 

2 businesses making the sales referred to in subsection 

3 (a)(2). 

4 (d) AUTHORIZATION OF APPROPRIATIONS.—There 

5 are authorized to be appropriated to the Secretary of En6 ergy such sums as are necessary for the purposes of this 

7 section. 

8 SEC. 243. CLARIFYING ELECTION OF WASTE HEAT RECOV9 ERY FINANCIAL INCENTIVES. 

10 Section 373(e) of the Energy Policy and Conservation 

11 Act (42 U.S.C. 6343(e)) is amended— 

12 (1) by striking ‘‘that qualifies for’’ and insert13 ing ‘‘who elects to claim’’; and 

14 (2) by inserting ‘‘from that project’’ after ‘‘for 

15 waste heat recovery’’. 

16 SEC. 244. MOTOR MARKET ASSESSMENT AND COMMERCIAL 

17 AWARENESS PROGRAM. 

18 (a) FINDINGS.—Congress finds that— 

19 (1) electric motor systems account for about 

20 half of the electricity used in the United States; 

21 (2) electric motor energy use is determined by 

22 both the efficiency of the motor and the system in 

23 which the motor operates; 


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1 (3) Federal Government research on motor end 

2 use and efficiency opportunities is more than a dec3 ade old; and 

4 (4) the Census Bureau has discontinued collec5 tion of data on motor and generator importation, 

6 manufacture, shipment, and sales. 

7 (b) DEFINITIONS.—In this section: 

8 (1) DEPARTMENT.—The term ‘‘Department’’ 

9 means the Department of Energy. 

10 (2) INTERESTED PARTIES.—The term ‘‘inter11 ested parties’’ includes— 

12 (A) trade associations; 

13 (B) motor manufacturers; 

14 (C) motor end users; 

15 (D) electric utilities; and 

16 (E) individuals and entities that conduct 

17 energy efficiency programs. 

18 (3) SECRETARY.—The term ‘‘Secretary’’ means 

19 the Secretary of Energy, in consultation with inter20 ested parties. 

21 (c) ASSESSMENT.—The Secretary shall conduct an 

22 assessment of electric motors and the electric motor mar23 ket in the United States that shall— 


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1 (1) include important subsectors of the indus2 trial and commercial electric motor market (as de3 termined by the Secretary), including— 

4 (A) the stock of motors and motor-driven 

5 equipment; 

6 (B) efficiency categories of the motor pop7 ulation; and 

8 (C) motor systems that use drives, servos, 

9 and other control technologies; 

10 (2) characterize and estimate the opportunities 

11 for improvement in the energy efficiency of motor 

12 systems by market segment, including opportunities 

13 for— 

14 (A) expanded use of drives, servos, and 

15 other control technologies; 

16 (B) expanded use of process control, 

17 pumps, compressors, fans or blowers, and mate18 rial handling components; and 

19 (C) substitution of existing motor designs 

20 with existing and future advanced motor de21 signs, including electronically commutated per22 manent magnet, interior permanent magnet, 

23 and switched reluctance motors; and 

24 (3) develop an updated profile of motor system 

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1 veying the number of companies that have motor 

2 purchase and repair specifications, by company size, 

3 number of employees, and sales. 

4 (d) RECOMMENDATIONS; UPDATE.—Based on the as5 sessment conducted under subsection (c), the Secretary 

6 shall— 

7 (1) develop— 

8 (A) recommendations to update the de9 tailed motor profile on a periodic basis; 

10 (B) methods to estimate the energy sav11 ings and market penetration that is attributable 

12 to the Save Energy Now Program of the De13 partment; and 

14 (C) recommendations for the Director of 

15 the Census Bureau on market surveys that 

16 should be undertaken in support of the motor 

17 system activities of the Department; and 

18 (2) prepare an update to the Motor Master+ 

19 program of the Department. 

20 (e) PROGRAM.—Based on the assessment, rec21 ommendations, and update required under subsections (c) 

22 and (d), the Secretary shall establish a proactive, national 

23 program targeted at motor end-users and delivered in co24 operation with interested parties to increase awareness 

25 of— 


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1 (1) the energy and cost-saving opportunities in 

2 commercial and industrial facilities using higher effi3 ciency electric motors; 

4 (2) improvements in motor system procurement 

5 and management procedures in the selection of high6 er efficiency electric motors and motor-system com7 ponents, including drives, controls, and driven equip8 ment; and 

9 (3) criteria for making decisions for new, re10 placement, or repair motor and motor system com11 ponents. 

12 SEC. 245. MOTOR EFFICIENCY REBATE PROGRAM. 

13 (a) IN GENERAL.—Part C of title III of the Energy 

14 Policy and Conservation Act (42 U.S.C. 6311 et seq.) is 

15 amended by adding at the end the following: 

16 ‘‘SEC. 347. MOTOR EFFICIENCY REBATE PROGRAM. 

17 ‘‘(a) ESTABLISHMENT.—Not later than January 1, 

18 2010, in accordance with subsection (b), the Secretary 

19 shall establish a program to provide rebates for expendi20 tures made by entities— 

21 ‘‘(1) for the purchase and installation of a new 

22 electric motor that has a nominal full load efficiency 

23 that is not less than the nominal full load efficiency 

24 as defined in— 


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1 ‘‘(A) table 12–12 of NEMA Standards 

2 Publication MG 1–2006 for random wound mo3 tors rated 600 volts or lower; or 

4 ‘‘(B) table 12–13 of NEMA Standards 

5 Publication MG 1–2006 for form wound motors 

6 rated 5000 volts or lower; and 

7 ‘‘(2) to replace an installed motor of the entity 

8 the specifications of which are established by the 

9 Secretary by a date that is not later than 90 days 

10 after the date of enactment of this section. 

11 ‘‘(b) REQUIREMENTS.— 

12 ‘‘(1) APPLICATION.—To be eligible to receive a 

13 rebate under this section, an entity shall submit to 

14 the Secretary an application in such form, at such 

15 time, and containing such information as the Sec16 retary may require, including— 

17 ‘‘(A) demonstrated evidence that the entity 

18 purchased an electric motor described in sub19 section (a)(1) to replace an installed motor de20 scribed in subsection (a)(2); 

21 ‘‘(B) demonstrated evidence that the enti22 ty— 

23 ‘‘(i) removed the installed motor of 

24 the entity from service; and 


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1 ‘‘(ii) properly disposed the installed 

2 motor of the entity; and 

3 ‘‘(C) the physical nameplate of the in4 stalled motor of the entity. 

5 ‘‘(2) AUTHORIZED AMOUNT OF REBATE.—The 

6 Secretary may provide to an entity that meets each 

7 requirement under paragraph (1) a rebate the 

8 amount of which shall be equal to the product ob9 tained by multiplying— 

10 ‘‘(A) the nameplate horsepower of the elec11 tric motor purchased by the entity in accord12 ance with subsection (a)(1); and 

13 ‘‘(B) $25.00. 

14 ‘‘(3) PAYMENTS TO DISTRIBUTORS OF QUALI15 FYING ELECTRIC MOTORS.—To assist in the pay16 ment for expenses relating to processing and motor 

17 core disposal costs, the Secretary shall provide to the 

18 distributor of an electric motor described in sub19 section (a)(1), the purchaser of which received a re20 bate under this section, an amount equal to the 

21 product obtained by multiplying— 

22 ‘‘(A) the nameplate horsepower of the elec23 tric motor; and 

24 ‘‘(B) $5.00. 


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1 ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There 

2 are authorized to be appropriated to carry out this section, 

3 to remain available until expended— 

4 ‘‘(1) $80,000,000 for fiscal year 2011; 

5 ‘‘(2) $75,000,000 for fiscal year 2012; 

6 ‘‘(3) $70,000,000 for fiscal year 2013; 

7 ‘‘(4) $65,000,000 for fiscal year 2014; and 

8 ‘‘(5) $60,000,000 for fiscal year 2015.’’. 

9 (b) TABLE OF CONTENTS.—The table of contents of 

10 the Energy Policy and Conservation Act (42 U.S.C. prec. 

11 6201) is amended by adding at the end of the items relat12 ing to part C of title III the following: 

‘‘Sec. 347. Motor efficiency rebate program.’’. 

13 Subtitle E—Improvements in En14 ergy Savings Performance Con15 tracting 

16 SEC. 251. ENERGY SAVINGS PERFORMANCE CONTRACTS. 

17 (a) COMPETITION REQUIREMENTS FOR TASK OR DE18 LIVERY ORDERS UNDER ENERGY SAVINGS PERFORM19 ANCE CONTRACTS.— 

20 (1) COMPETITION REQUIREMENTS.—Subsection 

21 (a) of section 801 of the National Energy Conserva22 tion Policy Act (42 U.S.C. 8287(a)) is amended by 

23 adding at the end the following paragraph: 


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1 ‘‘(3)(A) The head of a Federal agency may issue a 

2 task or delivery order under an energy savings perform3 ance contract by— 

4 ‘‘(i) notifying all contractors that have received 

5 an award under such contract that the agency pro6 poses to discuss energy savings performance services 

7 for some or all of its facilities and, following a rea8 sonable period of time to provide a proposal in re9 sponse to the notice, soliciting an expression of in10 terest in performing site surveys or investigations 

11 and feasibility designs and studies and the submis12 sion of qualifications from such contractors, and in13 cluding in such notice summary information con14 cerning energy use for any facilities that the agency 

15 has specific interest in including in such contract; 

16 ‘‘(ii) reviewing all expressions of interest and 

17 qualifications submitted pursuant to the notice 

18 under clause (i); 

19 ‘‘(iii) selecting two or more contractors (from 

20 among those reviewed under clause (ii)) to conduct 

21 discussions concerning the contractors’ respective 

22 qualifications to implement potential energy con23 servation measures, including requesting references 

24 demonstrating experience on similar efforts and the 

25 resulting energy savings of such similar efforts, and 


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1 providing an opportunity for a post-award debriefing 

2 to all contractors that submitted expressions of in3 terest and qualifications under clause (ii) pursuant 

4 to the notice; 

5 ‘‘(iv) selecting and authorizing— 

6 ‘‘(I) more than one contractor (from 

7 among those selected under clause (iii)) to con8 duct site surveys, investigations, feasibility de9 signs and studies or similar assessments for the 

10 energy savings performance contract services 

11 (or for discrete portions of such services), for 

12 the purpose of allowing each such contractor to 

13 submit a firm, fixed-price proposal to imple14 ment specific energy conservation measures; or 

15 ‘‘(II) one contractor (from among those se16 lected under clause (iii)) to conduct a site sur17 vey, investigation, a feasibility design and study 

18 or similar for the purpose of allowing the con19 tractor to submit a firm, fixed-price proposal to 

20 implement specific energy conservation meas21 ures; 

22 ‘‘(v) negotiating a task or delivery order for en23 ergy savings performance contracting services with 

24 the contractor or contractors selected under clause 


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1 (iv) based on the energy conservation measures iden2 tified; and 

3 ‘‘(vi) issuing a task or delivery order for energy 

4 savings performance contracting services to such 

5 contractor or contractors. 

6 ‘‘(B) The issuance of a task or delivery order for en7 ergy savings performance contracting services pursuant to 

8 subparagraph (A) is deemed to satisfy the task and deliv9 ery order competition requirements in section 2304c(d) of 

10 title 10, United States Code, and section 303J(d) of the 

11 Federal Property and Administrative Services Act of 1949 

12 (41 U.S.C. 253j(d)). 

13 ‘‘(C) The Secretary may issue guidance as necessary 

14 to agencies issuing task or delivery orders pursuant to 

15 subparagraph (A).’’. 

16 (2) EFFECTIVE DATE.—The amendment made 

17 by paragraph (1) is inapplicable to task or delivery 

18 orders issued before the date of enactment of this 

19 section. 

20 (b) INCLUSION OF THERMAL RENEWABLE EN21 ERGY.—Section 203 of the Energy Policy Act of 2005 (42 

22 U.S.C. 15852) is amended— 

23 (1) in subsection (a), by striking ‘‘electric’’; and 

24 (2) in subsection (b)(2), by inserting ‘‘or ther25 mal’’ after ‘‘means electric’’. 


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1 (c) CREDIT FOR RENEWABLE ENERGY PRODUCED

2 AND USED ON SITE.—Subsection (c) of section 203 of the 

3 Energy Policy Act of 2005 (42 U.S.C. 15852) is amended 

4 to read as follows: 

5 ‘‘(c) CALCULATION.—Renewable energy produced at 

6 a Federal facility, on Federal lands, or on Indian lands 

7 (as defined in title XXVI of the Energy Policy Act of 1992 

8 (25 U.S.C. 3501 et seq.)) shall be calculated separately 

9 from renewable energy consumed at a Federal facility, and 

10 each may be used to comply with the consumption require11 ment under subsection (a).’’. 

12 (d) FINANCING FLEXIBILITY.—Section 801(a)(2)(E) 

13 of the National Energy Conservation Policy Act (42 

14 U.S.C. 8287(a)(2)(E)) is amended by striking ‘‘In’’ and 

15 inserting ‘‘Notwithstanding any other provision of law, 

16 in’’. 

17 Subtitle F—Public Institutions 

18 SEC. 261. PUBLIC INSTITUTIONS. 

19 Section 399A of the Energy Policy and Conservation 

20 Act (42 U.S.C. 6371h–1) is amended— 

21 (1) in subsection (a)(5), by striking ‘‘or a des22 ignee’’ and inserting ‘‘an Indian tribe, a not-for23 profit hospital or not-for-profit inpatient health care 

24 facility, or a designated agent’’; 


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1 (2) in subsection (c)(1), by striking subpara2 graph (C); 

3 (3) in subsection (f)(3)(A), by striking 

4 ‘‘$1,000,000’’ and inserting ‘‘$2,500,000’’; and 

5 (4) in subsection (i)(1), by striking 

6 ‘‘$250,000,000 for each of fiscal years 2009 through 

7 2013’’ and inserting ‘‘$250,000,000 for each of fis8 cal years 2010 through 2015’’. 

9 SEC. 262. COMMUNITY ENERGY EFFICIENCY FLEXIBILITY. 

10 Section 545(b)(3) of the Energy Independence and 

11 Security Act of 2007 (42 U.S.C. 17155(b)(3)) is amend12 ed— 

13 (1) by striking ‘‘Indian tribe may use’’ and all 

14 that follows through ‘‘for administrative expenses’’ 

15 and inserting ‘‘Indian tribe may use for administra16 tive expenses’’; 

17 (2) by striking subparagraphs (B) and (C); 

18 (3) by redesignating the remaining clauses (i) 

19 and (ii) as subparagraphs (A) and (B), respectively 

20 and adjusting the margin of those subparagraphs ac21 cordingly; and 

22 (4) by striking the semicolon at the end and in23 serting a period. 


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1 SEC. 263. SMALL COMMUNITY JOINT PARTICIPATION. 

2 (a) Section 541(3)(A) of the Energy Independence 

3 and Security Act of 2007 is amended in clause (i) by strik4 ing ‘‘and’’ at the end of subclause (II), in clause (ii) by 

5 striking the period at the end of subclause (II) and insert6 ing ‘‘; or’’, and by inserting the following new clause (iii): 

7 ‘‘(iii) a group of adjacent, contiguous, or 

8 geographically proximate units of local govern9 ment that reach agreement to act jointly for 

10 purposes of this section and that represent a 

11 combined population of not less than 35,000.’’. 

12 (b) Section 541(3)(B) of the Energy Independence 

13 and Security Act of 2007 is amended in clause (i) by strik14 ing ‘‘or’’, in clause (ii) by striking the period at the end 

15 and inserting ‘‘; or’’, and by inserting the following new 

16 clause (iii): 

17 ‘‘(iii) a group of adjacent, contiguous, or 

18 geographically proximate units of local govern19 ment that reach agreement to act jointly for 

20 purposes of this section and that represent a 

21 combined population of not less than 50,000.’’. 

22 SEC. 264. LOW INCOME COMMUNITY ENERGY EFFICIENCY 

23 PROGRAM. 

24 (a) IN GENERAL.—The Secretary of Energy is au25 thorized to make grants to private, nonprofit, mission26 driven community development organizations including 


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1 community development corporations and community de2 velopment financial institutions to provide financing to 

3 businesses and projects that improve energy efficiency; 

4 identify and develop alternative, renewable, and distrib5 uted energy supplies; provide technical assistance and pro6 mote job and business opportunities for low-income resi7 dents; and increase energy conservation in low income 

8 rural and urban communities. 

9 (b) GRANTS.—The purpose of such grants is to in10 crease the flow of capital and benefits to low income com11 munities, minority-owned and woman-owned businesses 

12 and entrepreneurs and other projects and activities located 

13 in low income communities in order to reduce environ14 mental degradation, foster energy conservation and effi15 ciency and create job and business opportunities for local 

16 residents. The Secretary may make grants on a competi17 tive basis for— 

18 (1) investments that develop alternative, renew19 able, and distributed energy supplies; 

20 (2) capitalizing loan funds that lend to energy 

21 efficiency projects and energy conservation pro22 grams; 

23 (3) technical assistance to plan, develop, and 

24 manage an energy efficiency financing program; and 


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1 (4) technical and financial assistance to assist 

2 small-scale businesses and private entities develop 

3 new renewable and distributed sources of power or 

4 combined heat and power generation. 

5 (c) AUTHORIZATION OF APPROPRIATIONS.—For the 

6 purposes of this section there is authorized to be appro7 priated $50,000,000 for each of the fiscal years 2010 

8 through 2015. 

9 Subtitle G—Miscellaneous 

10 SEC. 271. ENERGY EFFICIENT INFORMATION AND COMMU11 NICATIONS TECHNOLOGIES. 

12 Section 543 of the National Energy Conservation 

13 Policy Act (42 U.S.C. 8253) is amended to read as follows: 

14 ‘‘SEC. 543. ENERGY EFFICIENT INFORMATION AND COMMU15 NICATIONS TECHNOLOGIES. 

16 ‘‘(a) IN GENERAL.—Not later than 1 year after the 

17 date of enactment of the American Clean Energy and Se18 curity Act of 2009, each Federal agency shall collaborate 

19 with the Director of the Office of Management and Budget 

20 (referred to in this section as the ‘Director’) to create an 

21 implementation strategy, including best practices and 

22 measurement and verification techniques, for the purchase 

23 and use of energy efficient information and communica24 tions technologies and practices. Wherever possible, exist25 ing standards, specifications, performance metrics, and 


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1 best management practices that have been or are being 

2 developed in open collaboration and with broad stake3 holder input and review should be incorporated. In addi4 tion, agency strategies shall be flexible, cost-effective, and 

5 based on the specific operating requirements and statutory 

6 mission of each agency. 

7 ‘‘(b) ENERGY EFFICIENT INFORMATION AND COM8 MUNICATIONS TECHNOLOGIES.—In developing an imple9 mentation strategy, each agency shall— 

10 ‘‘(1) consider information and communications 

11 technologies and infrastructure, including, but not 

12 limited to, advanced metering infrastructure, infor13 mation and communications technology services and 

14 products, efficient data center strategies, applica15 tions modernization and rationalization, building 

16 systems energy efficiency, and telework; and 

17 ‘‘(2) ensure that agencies are eligible to realize 

18 the savings and rewards brought about through in19 creased efficiencies. 

20 ‘‘(c) PERFORMANCE GOALS.—Not later than 6 

21 months after the date of enactment of the American Clean 

22 Energy and Security Act of 2009, the Director shall estab23 lish performance goals for evaluating the efforts of the 

24 agencies in improving the maintenance, purchase and use 

25 of energy efficiency of information and communications 


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1 technology systems. These performance goals should 

2 measure information technology costs over a specific time 

3 horizon (3 to 5 years), providing a complete picture of all 

4 costs, including energy. 

5 ‘‘(d) REPORT.—Not later than 18 months after the 

6 date of enactment of the American Clean Energy and Se7 curity Act of 2009, and annually thereafter, the Director 

8 shall submit a report to Congress on— 

9 ‘‘(1) the progress of each agency in reducing 

10 energy use through its implementation strategy; and 

11 ‘‘(2) new and emerging technologies that would 

12 help achieve increased energy efficiency.’’. 

13 SEC. 272. NATIONAL ENERGY EFFICIENCY GOALS. 

14 (a) GOALS.—The energy efficiency goals of the 

15 United States are— 

16 (1) to achieve an improvement in the overall en17 ergy productivity of the United States (measured in 

18 gross domestic product per unit of energy input) of 

19 at least 2.5 percent per year by the year 2012; and 

20 (2) to maintain that annual rate of improve21 ment each year through 2030. 

22 (b) STRATEGIC PLAN.— 

23 (1) IN GENERAL.—Not later than 1 year after 

24 the date of enactment of this Act, the Secretary of 

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1 retary’’), in cooperation with the Administrator and 

2 the heads of other appropriate Federal agencies, 

3 shall develop a strategic plan to achieve the national 

4 goals for improvement in energy productivity estab5 lished under subsection (a). 

6 (2) PUBLIC INPUT AND COMMENT.—The Sec7 retary shall develop the plan in a manner that pro8 vides appropriate opportunities for public input and 

9 comment. 

10 (c) PLAN CONTENTS.—The strategic plan shall— 

11 (1) identify future regulatory, funding, and pol12 icy priorities that would assist the United States in 

13 meeting the national goals; 

14 (2) include energy savings estimates for each 

15 sector; and 

16 (3) include data collection methodologies and 

17 compilations used to establish baseline and energy 

18 savings data. 

19 (d) PLAN UPDATES.— 

20 (1) IN GENERAL.—The Secretary shall— 

21 (A) update the strategic plan biennially; 

22 and 

23 (B) include the updated strategic plan in 

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1 tion 801 of the Department of Energy Organi2 zation Act (42 U.S.C. 7321). 

3 (2) CONTENTS.—In updating the plan, the Sec4 retary shall— 

5 (A) report on progress made toward imple6 menting efficiency policies to achieve the na7 tional goals established under subsection (a); 

8 and 

9 (B) verify, to the maximum extent prac10 ticable, energy savings resulting from the poli11 cies. 

12 (e) REPORT TO CONGRESS AND THE PUBLIC.—The 

13 Secretary shall submit to Congress, and make available 

14 to the public, the initial strategic plan developed under 

15 subsection (b) and each updated plan. 

16 SEC. 273. AFFILIATED ISLAND ENERGY INDEPENDENCE 

17 TEAM. 

18 (a) DEFINITIONS.—In this section: 

19 (1) AFFILIATED ISLAND.—The term ‘‘affiliated 

20 island’’ means— 

21 (A) the Commonwealth of Puerto Rico; 

22 (B) Guam; 

23 (C) American Samoa; 

24 (D) the Commonwealth of the Northern 

25 Mariana Islands; 


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1 (E) the Federated States of Micronesia; 

2 (F) the Republic of the Marshall Islands; 

3 (G) the Republic of Palau; and 

4 (H) the United States Virgin Islands. 

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

6 the Secretary of Energy (acting through the Assist7 ant Secretary of Energy Efficiency and Renewable 

8 Energy), in consultation with the Secretary of the 

9 Interior and the Secretary of State. 

10 (3) TEAM.—The term ‘‘team’’ means the team 

11 established by the Secretary under subsection (b). 

12 (b) ESTABLISHMENT.—As soon as practicable after 

13 the date of enactment of this Act, the Secretary shall as14 semble a team of technical, policy, and financial experts 

15 to address the energy needs of each affiliated island— 

16 (1) to reduce the reliance and expenditure of 

17 each affiliated island on imported fossil fuels; 

18 (2) to increase the use by each affiliated island 

19 of indigenous, nonfossil fuel energy sources; 

20 (3) to improve the performance of the energy 

21 infrastructure of the affiliated island through 

22 projects— 

23 (A) to improve the energy efficiency of 

24 power generation, transmission, and distribu25 tion; and 


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1 (B) to increase consumer energy efficiency; 

2 (4) to improve the performance of the energy 

3 infrastructure of each affiliated island through en4 hanced planning, education, and training; 

5 (5) to adopt research-based and public-private 

6 partnership-based approaches as appropriate; 

7 (6) to stimulate economic development and job 

8 creation; and 

9 (7) to enhance the engagement by the Federal 

10 Government in international efforts to address island 

11 energy needs. 

12 (c) DUTIES OF TEAM.— 

13 (1) ENERGY ACTION PLANS.— 

14 (A) IN GENERAL.—In accordance with 

15 subparagraph (B), the team shall provide tech16 nical, programmatic, and financial assistance to 

17 each utility of each affiliated island, and the 

18 government of each affiliated island, as appro19 priate, to develop and implement an energy Ac20 tion Plan for each affiliated island to reduce the 

21 reliance of each affiliated island on imported 

22 fossil fuels through increased efficiency and use 

23 of indigenous clean-energy resources. 


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1 (B) REQUIREMENTS.—Each Action Plan 

2 described in subparagraph (A) for each affili3 ated island shall require and provide for— 

4 (i) the conduct of 1 or more studies to 

5 assess opportunities to reduce fossil fuel 

6 use through— 

7 (I) the improvement of the en8 ergy efficiency of the affiliated island; 

9 and 

10 (II) the increased use by the af11 filiated island of indigenous clean-en12 ergy resources; 

13 (ii) the identification and implementa14 tion of the most cost-effective strategies 

15 and projects to reduce the dependence of 

16 the affiliated island on fossil fuels; 

17 (iii) the promotion of education and 

18 training activities to improve the capacity 

19 of the local utilities of the affiliated island, 

20 and the government of the affiliated island, 

21 as appropriate, to plan for, maintain, and 

22 operate the energy infrastructure of the af23 filiated island through the use of local or 

24 regional institutions, as appropriate; 


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1 (iv) the coordination of the activities 

2 described in clause (iii) to leverage the ex3 pertise and resources of international enti4 ties, the Department of Energy, the De5 partment of the Interior, and the regional 

6 utilities of the affiliated island; 

7 (v) the identification, and develop8 ment, as appropriate, of research-based 

9 and private-public, partnership approaches 

10 to implement the Action Plan; and 

11 (vi) any other component that the 

12 Secretary determines to be necessary to re13 duce successfully the use by each affiliated 

14 island of fossil fuels. 

15 (2) REPORTS TO SECRETARY.—Not later than 

16 1 year after the date on which the Secretary estab17 lishes the team and biennially thereafter, the team 

18 shall submit to the Secretary a report that contains 

19 a description of the progress of each affiliated island 

20 in— 

21 (A) implementing the Action Plan of the 

22 affiliated island developed under paragraph 

23 (1)(A); and 

24 (B) reducing the reliance of the affiliated 

25 island on fossil fuels. 


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1 (d) USE OF REGIONAL UTILITY ORGANIZATIONS.— 

2 To provide expertise to affiliated islands to assist the af3 filiated islands in meeting the purposes of this section, the 

4 Secretary shall consider— 

5 (1) including regional utility organizations in 

6 the establishment of the team; and 

7 (2) providing assistance through regional utility 

8 organizations. 

9 (e) ANNUAL REPORTS TO CONGRESS.—Not later 

10 than 30 days after the date on which the Secretary re11 ceives a report submitted by the team under subsection 

12 (c)(2), the Secretary shall submit to the appropriate com13 mittees of Congress a report that contains a summary of 

14 the report of the team. 

15 (f) AUTHORIZATION OF APPROPRIATIONS.—There 

16 are authorized to be appropriated such sums as are nec17 essary to carry out this section. 

18 SEC. 274. PRODUCT CARBON DISCLOSURE PROGRAM. 

19 (a) EPA STUDY.—The Administrator shall conduct 

20 a study to determine the feasibility of establishing a na21 tional program for measuring, reporting, publicly dis22 closing, and labeling products or materials sold in the 

23 United States for their carbon content, and shall, not later 

24 than 18 months after the date of enactment of this Act, 


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1 transmit a report to Congress which shall include the fol2 lowing: 

3 (1) A determination of whether a national prod4 uct carbon disclosure program and labeling program 

5 would be effective in achieving the intended goals of 

6 achieving greenhouse gas reductions and an exam7 ination of existing programs globally and their 

8 strengths and weaknesses. 

9 (2) Criteria for identifying and prioritizing sec10 tors and products and processes that should be cov11 ered in such program or programs. 

12 (3) An identification of products, processes, or 

13 sectors whose inclusion could have a substantial car14 bon impact (prioritizing industrial products such as 

15 iron and steel, aluminum, cement, chemicals, and 

16 paper products, and also including food, beverage, 

17 hygiene, cleaning, household cleaners, construction, 

18 metals, clothing, semiconductor, and consumer elec19 tronics). 

20 (4) Suggested methodology and protocols for 

21 measuring the carbon content of the products across 

22 the entire carbon lifecycle of such products for use 

23 in a carbon disclosure program and labeling pro24 gram. 


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1 (5) A review of existing greenhouse gas product 

2 accounting standards, methodologies, and practices 

3 including the Greenhouse Gas Protocol, ISO 14040/ 

4 44, ISO 14067, and Publically Available Specifica5 tion 2050, and including a review of the strengths 

6 and weaknesses of each. 

7 (6) A survey of secondary databases including 

8 the Manufacturing Energy Consumption Survey and 

9 evaluate the quality of data for use in a product car10 bon disclosure program and product carbon labeling 

11 program and an identification of gaps in the data 

12 relative to the potential purposes of a national prod13 uct carbon disclosure program and product carbon 

14 labeling program and development of recommenda15 tions for addressing these data gaps. 

16 (7) An assessment of the utility of comparing 

17 products and the appropriateness of product carbon 

18 standards. 

19 (8) An evaluation of the information needed on 

20 a label for clear and accurate communication, in21 cluding what pieces of quantitative and qualitative 

22 information needs to be disclosed. 

23 (9) An evaluation of the appropriate boundaries 

24 of the carbon lifecycle analysis for different sectors 

25 and products. 


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1 (10) An analysis of whether default values 

2 should be developed for products whose producer 

3 does not participate in the program or does not have 

4 data to support a disclosure or label and determine 

5 best ways to develop such default values. 

6 (11) A recommendation of certification and 

7 verification options necessary to assure the quality 

8 of the information and avoid greenwashing or the 

9 use of insubstantial or meaningless environmental 

10 claims to promote a product. 

11 (12) An assessment of options for educating 

12 consumers about product carbon content and the 

13 product carbon disclosure program and product car14 bon labeling program. 

15 (13) An analysis of the costs and timelines as16 sociated with establishing a national product carbon 

17 disclosure program and product carbon labeling pro18 gram, including options for a phased approach. 

19 Costs should include those for businesses associated 

20 with the measurement of carbon footprints and 

21 those associated with creating a product carbon label 

22 and managing and operating a product carbon label23 ing program, and options for minimizing these costs. 

24 (14) An evaluation of incentives (such as finan25 cial incentives, brand reputation, and brand loyalty) 


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1 to determine whether reductions in emissions can be 

2 accelerated through encouraging more efficient man3 ufacturing or by encouraging preferences for lower4 emissions products to substitute for higher-emissions 

5 products whose level of performance is no better. 

6 (b) DEVELOPMENT OF NATIONAL CARBON DISCLO7 SURE PROGRAM.—Upon conclusion of the study, and not 

8 more than 36 months after the date of enactment of this 

9 Act, the Administrator shall establish a national product 

10 carbon disclosure program, participation in which shall be 

11 voluntary, and which may involve a product carbon label 

12 with broad applicability to the wholesale and consumer 

13 markets to enable and encourage knowledge about carbon 

14 content by producers and consumers and to inform efforts 

15 to reduce energy consumption (carbon dioxide equivalent 

16 emissions) nationwide. In developing such a program, the 

17 Administrator shall— 

18 (1) consider the results of the study conducted 

19 under subsection (a); 

20 (2) consider existing and planned programs and 

21 proposals and measurement standards (including the 

22 Publicly Available Specification 2050, standards to 

23 be developed by the World Resource Institute/World 

24 Business Council for Sustainable Development, the 


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1 International Standards Organization, and the bill 

2 AB19 pending in the California legislature); 

3 (3) consider the compatibility of a national 

4 product carbon disclosure program with existing pro5 grams; 

6 (4) utilize incentives and other means to spur 

7 the adoption of product carbon disclosure and prod8 uct carbon labeling; 

9 (5) develop protocols and parameters for a 

10 product carbon disclosure program, including a 

11 methodology and formula for assessing, verifying, 

12 and potentially labeling a product’s greenhouse gas 

13 content, and for data quality requirements to allow 

14 for product comparison; 

15 (6) create a means to— 

16 (A) document best practices; 

17 (B) ensure clarity and consistency; 

18 (C) work with suppliers, manufacturers, 

19 and retailers to encourage participation; 

20 (D) ensure that protocols are consistent 

21 and comparable across like products; and 

22 (E) evaluate the effectiveness of the pro23 gram; 

24 (7) make publicly available information on 

25 product carbon content to ensure transparency; 


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1 (8) provide for public outreach, including a con2 sumer education program to increase awareness; 

3 (9) develop training and education programs to 

4 help businesses learn how to measure and commu5 nicate their carbon footprint and easy tools and tem6 plates for businesses to use to reduce cost and time 

7 to measure their products’ carbon lifecycle; 

8 (10) consult with the Secretary of Energy, the 

9 Secretary of Commerce, the Federal Trade Commis10 sion, and other Federal agencies, as necessary; 

11 (11) gather input from stakeholders through 

12 consultations, public workshops or hearings with 

13 representatives of consumer product manufacturers, 

14 consumer groups, and environmental groups; 

15 (12) utilize systems for verification and product 

16 certification that will ensure that claims manufactur17 ers make about their products are valid; 

18 (13) create a process for reviewing the accuracy 

19 of product carbon label information and protecting 

20 the product carbon label in the case of a change in 

21 the product’s energy source, supply chain, ingredi22 ents, or other factors, and specify the frequency to 

23 which data should be updated; and 

24 (14) develop a standardized, easily understand25 able carbon label, if appropriate, and create a procVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00519 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ess for responding to inaccuracies and misuses of 

2 such a label. 

3 (c) REPORT TO CONGRESS.—Not later than 5 years 

4 after the program is established pursuant to subsection 

5 (b), the Administrator shall report to Congress on the ef6 fectiveness and impact of the program, the level of vol7 untary participation, and any recommendations for addi8 tional measures. 

9 (d) DEFINITIONS.—As used in this section— 

10 (1) the term ‘‘carbon content’’ means the 

11 amount of greenhouse gas emissions and their 

12 warming impact on the atmosphere expressed in car13 bon dioxide equivalent associated with a product’s 

14 value chain; 

15 (2) the term ‘‘carbon footprint’’ means the level 

16 of greenhouse gas emissions produced by a par17 ticular activity, service, or entity; and 

18 (3) the term ‘‘carbon lifecycle’’ means the 

19 greenhouse gas emissions that are released as part 

20 of the processes of creating, producing, processing or 

21 manufacturing, modifying, transporting, distrib22 uting, storing, using, recycling, or disposing of goods 

23 and services. 

24 (e) AUTHORIZATION OF APPROPRIATIONS.—There is 

25 authorized to be appropriated to the Administrator 


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1 $5,000,000 for the study required by subsection (a) and 

2 $25,000,000 for each of fiscal years 2010 through 2025 

3 for the program required under subsection (b). 

4 TITLE III—REDUCING GLOBAL 

5 WARMING POLLUTION 

6 SEC. 301. SHORT TITLE. 

7 This title, and sections 112, 116, 221, 222, 223, and 

8 401 of this Act, and the amendments made by this title 

9 and those sections, may be cited as the ‘‘Safe Climate 

10 Act’’. 

11 Subtitle A—Reducing Global 

12 Warming Pollution 

13 SEC. 311. REDUCING GLOBAL WARMING POLLUTION. 

14 The Clean Air Act (42 U.S.C. and following) is 

15 amended by adding after title VI the following new title: 

16 ‘‘TITLE VII—GLOBAL WARMING 

17 POLLUTION REDUCTION PRO18 GRAM 

19 ‘‘PART A—GLOBAL WARMING POLLUTION 

20 REDUCTION GOALS AND TARGETS 

21 ‘‘SEC. 701. FINDINGS AND PURPOSE. 

22 ‘‘(a) FINDINGS.—The Congress finds as follows: 

23 ‘‘(1) Global warming poses a significant threat 

24 to the national security, economy, public health and 


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1 welfare, and environment of the United States, as 

2 well as of other nations. 

3 ‘‘(2) Reviews of scientific studies, including by 

4 the Intergovernmental Panel on Climate Change and 

5 the National Academy of Sciences, demonstrate that 

6 global warming is the result of the combined anthro7 pogenic greenhouse gas emissions from numerous 

8 sources of all types and sizes. Each increment of 

9 emission, when combined with other emissions, 

10 causes or contributes materially to the acceleration 

11 and extent of global warming and its adverse effects 

12 for the lifetime of such gas in the atmosphere. Ac13 cordingly, controlling emissions in small as well as 

14 large amounts is essential to prevent, slow the pace 

15 of, reduce the threats from, and mitigate global 

16 warming and its adverse effects. 

17 ‘‘(3) Because they induce global warming, 

18 greenhouse gas emissions cause or contribute to in19 juries to persons in the United States, including— 

20 ‘‘(A) adverse health effects such as disease 

21 and loss of life; 

22 ‘‘(B) displacement of human populations; 

23 ‘‘(C) damage to property and other inter24 ests related to ocean levels, acidification, and 

25 ice changes; 


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1 ‘‘(D) severe weather and seasonal changes; 

2 ‘‘(E) disruption, costs, and losses to busi3 ness, trade, employment, farms, subsistence, 

4 aesthetic enjoyment of the environment, recre5 ation, culture, and tourism; 

6 ‘‘(F) damage to plants, forests, lands, and 

7 waters; 

8 ‘‘(G) harm to wildlife and habitat; 

9 ‘‘(H) scarcity of water and the decreased 

10 abundance of other natural resources; 

11 ‘‘(I) worsening of tropospheric air pollu12 tion; 

13 ‘‘(J) substantial threats of similar damage; 

14 and 

15 ‘‘(K) other harm. 

16 ‘‘(4) That many of these effects and risks of fu17 ture effects of global warming are widely shared 

18 does not minimize the adverse effects individual per19 sons have suffered, will suffer, and are at risk of 

20 suffering because of global warming. 

21 ‘‘(5) That some of the adverse and potentially 

22 catastrophic effects of global warming are at risk of 

23 occurring and not a certainty does not negate the 

24 harm persons suffer from actions that increase the 


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1 likelihood, extent, and severity of such future im2 pacts. 

3 ‘‘(6) Nations of the world look to the United 

4 States for leadership in addressing the threat of and 

5 harm from global warming. Full implementation of 

6 the Safe Climate Act is critical to engage other na7 tions in an international effort to mitigate the threat 

8 of and harm from global warming. 

9 ‘‘(7) Global warming and its adverse effects are 

10 occurring and are likely to continue and increase in 

11 magnitude, and to do so at a greater and more 

12 harmful rate, unless the Safe Climate Act is fully 

13 implemented and enforced in an expeditious manner. 

14 ‘‘(b) PURPOSE.—It is the general purpose of the Safe 

15 Climate Act to help prevent, reduce the pace of, mitigate, 

16 and remedy global warming and its adverse effects. To ful17 fill such purpose, it is necessary to— 

18 ‘‘(1) require the timely fulfillment of all govern19 mental acts and duties, both substantive and proce20 dural, and the prompt compliance of covered entities 

21 with the requirements of the Safe Climate Act; 

22 ‘‘(2) establish and maintain an effective, trans23 parent, and fair market for emission allowances and 

24 preserve the integrity of the cap on emissions and of 

25 offset credits; 


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1 ‘‘(3) advance the production and deployment of 

2 clean energy and energy efficiency technologies; and 

3 ‘‘(4) ensure effective enforcement of the Safe 

4 Climate Act by citizens, States, Indian tribes, and 

5 all levels of government because each violation of the 

6 Safe Climate Act is likely to result in an additional 

7 increment of greenhouse gas emission and will slow 

8 the pace of implementation of the Safe Climate Act 

9 and delay the achievement of the goals set forth in 

10 section 702, and cause or contribute to global warm11 ing and its adverse effects. 

12 ‘‘SEC. 702. ECONOMY-WIDE REDUCTION GOALS. 

13 ‘‘The goals of the Safe Climate Act are to reduce 

14 steadily the quantity of United States greenhouse gas 

15 emissions such that— 

16 ‘‘(1) in 2012, the quantity of United States 

17 greenhouse gas emissions does not exceed 97 percent 

18 of the quantity of United States greenhouse gas 

19 emissions in 2005; 

20 ‘‘(2) in 2020, the quantity of United States 

21 greenhouse gas emissions does not exceed 80 percent 

22 of the quantity of United States greenhouse gas 

23 emissions in 2005; 

24 ‘‘(3) in 2030, the quantity of United States 

25 greenhouse gas emissions does not exceed 58 percent 


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1 of the quantity of United States greenhouse gas 

2 emissions in 2005; and 

3 ‘‘(4) in 2050, the quantity of United States 

4 greenhouse gas emissions does not exceed 17 percent 

5 of the quantity of United States greenhouse gas 

6 emissions in 2005. 

7 ‘‘SEC. 703. REDUCTION TARGETS FOR SPECIFIED SOURCES. 

8 ‘‘(a) IN GENERAL.—The regulations issued under 

9 section 721 shall cap and reduce annually the greenhouse 

10 gas emissions of capped sources each calendar year begin11 ning in 2012 such that— 

12 ‘‘(1) in 2012, the quantity of greenhouse gas 

13 emissions from capped sources does not exceed 97 

14 percent of the quantity of greenhouse gas emissions 

15 from such sources in 2005; 

16 ‘‘(2) in 2020, the quantity of greenhouse gas 

17 emissions from capped sources does not exceed 83 

18 percent of the quantity of greenhouse gas emissions 

19 from such sources in 2005; 

20 ‘‘(3) in 2030, the quantity of greenhouse gas 

21 emissions from capped sources does not exceed 58 

22 percent of the quantity of greenhouse gas emissions 

23 from such sources in 2005; and 

24 ‘‘(4) in 2050, the quantity of greenhouse gas 

25 emissions from capped sources does not exceed 17 


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1 percent of the quantity of greenhouse gas emissions 

2 from such sources in 2005. 

3 ‘‘(b) DEFINITION.—For purposes of this section, the 

4 term ‘greenhouse gas emissions from such sources in 

5 2005’ means emissions to which section 722 would have 

6 applied if the requirements of this title for the specified 

7 year had been in effect for 2005. 

8 ‘‘SEC. 704. SUPPLEMENTAL POLLUTION REDUCTIONS. 

9 ‘‘For the purposes of decreasing the likelihood of cat10 astrophic climate change, preserving tropical forests, 

11 building capacity to generate offset credits, and facili12 tating international action on global warming, the Admin13 istrator shall set aside the percentage specified in section 

14 781 of the quantity of emission allowances established 

15 under section 721(a) for each year, to be used to achieve 

16 a reduction of greenhouse gas emissions from deforest17 ation in developing countries in accordance with part E. 

18 In 2020, activities supported under part E shall provide 

19 greenhouse gas reductions in an amount equal to an addi20 tional 10 percentage points of reductions from United 

21 States greenhouse gas emissions in 2005. The Adminis22 trator shall distribute these allowances with respect to ac23 tivities in countries that enter into and implement agree24 ments or arrangements relating to reduced deforestation 

25 as described in section 754(a)(2). 


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1 ‘‘SEC. 705. REVIEW AND PROGRAM RECOMMENDATIONS. 

2 ‘‘(a) IN GENERAL.—The Administrator shall, in con3 sultation with appropriate Federal agencies, submit to 

4 Congress a report not later than July 1, 2013, and every 

5 4 years thereafter, that includes— 

6 ‘‘(1) an analysis of key findings based on the 

7 latest scientific information and data relevant to 

8 global climate change; 

9 ‘‘(2) an analysis of capabilities to monitor and 

10 verify greenhouse gas reductions on a worldwide 

11 basis, including for the United States, as required 

12 under the Safe Climate Act; and 

13 ‘‘(3) an analysis of the status of worldwide 

14 greenhouse gas reduction efforts, including imple15 mentation of the Safe Climate Act and other poli16 cies, both domestic and international, for reducing 

17 greenhouse gas emissions, preventing dangerous at18 mospheric concentrations of greenhouse gases, pre19 venting significant irreversible consequences of cli20 mate change, and reducing vulnerability to the im21 pacts of climate change. 

22 ‘‘(b) EXCEPTION.—Paragraph (3) of subsection (a) 

23 shall not apply to the first report submitted under such 

24 subsection. 

25 ‘‘(c) LATEST SCIENTIFIC INFORMATION.—The anal26 ysis required under subsection (a)(1) shall— 


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1 ‘‘(1) address existing scientific information and 

2 reports, considering, to the greatest extent possible, 

3 the most recent assessment report of the Intergov4 ernmental Panel on Climate Change, reports by the 

5 United States Global Change Research Program, the 

6 Natural Resources Climate Change Adaptation 

7 Panel established under section 475 of the American 

8 Clean Energy and Security Act of 2009, and Fed9 eral agencies, and the European Union’s global tem10 perature data assessment; and 

11 ‘‘(2) review trends and projections for— 

12 ‘‘(A) global and country-specific annual 

13 emissions of greenhouse gases, and cumulative 

14 greenhouse gas emissions produced between 

15 1850 and the present, including— 

16 ‘‘(i) global cumulative emissions of an17 thropogenic greenhouse gases; 

18 ‘‘(ii) global annual emissions of an19 thropogenic greenhouse gases; and 

20 ‘‘(iii) by country, annual total, annual 

21 per capita, and cumulative anthropogenic 

22 emissions of greenhouse gases for the top 

23 50 emitting nations; 

24 ‘‘(B) significant changes, both globally and 

25 by region, in annual net non-anthropogenic 


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1 greenhouse gas emissions from natural sources, 

2 including permafrost, forests, or oceans; 

3 ‘‘(C) global atmospheric concentrations of 

4 greenhouse gases, expressed in annual con5 centration units as well as carbon dioxide 

6 equivalents based on 100-year global warming 

7 potentials; 

8 ‘‘(D) major climate forcing factors, such as 

9 aerosols; 

10 ‘‘(E) global average temperature, expressed 

11 as seasonal and annual averages in land, ocean, 

12 and land-plus-ocean averages; and 

13 ‘‘(F) sea level rise; 

14 ‘‘(3) assess the current and potential impacts of 

15 global climate change on— 

16 ‘‘(A) human populations, including impacts 

17 on public health, economic livelihoods, subsist18 ence, human infrastructure, and displacement 

19 or permanent relocation due to flooding, severe 

20 weather, extended drought, erosion, or other 

21 ecosystem changes; 

22 ‘‘(B) freshwater systems, including water 

23 resources for human consumption and agri24 culture and natural and managed ecosystems, 

25 flood and drought risks, and relative humidity; 


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1 ‘‘(C) the carbon cycle, including impacts 

2 related to the thawing of permafrost, the fre3 quency and intensity of wildfire, and terrestrial 

4 and ocean carbon sinks; 

5 ‘‘(D) ecosystems and animal and plant 

6 populations, including impacts on species abun7 dance, phenology, and distribution; 

8 ‘‘(E) oceans and ocean ecosystems, includ9 ing effects on sea level, ocean acidity, ocean 

10 temperatures, coral reefs, ocean circulation, 

11 fisheries, and other indicators of ocean eco12 system health; 

13 ‘‘(F) the cryosphere, including effects on 

14 ice sheet mass balance, mountain glacier mass 

15 balance, and sea-ice extent and volume; 

16 ‘‘(G) changes in the intensity, frequency, 

17 or distribution of severe weather events, includ18 ing precipitation, tropical cyclones, tornadoes, 

19 and severe heat waves; 

20 ‘‘(H) agriculture and forest systems; and 

21 ‘‘(I) any other indicators the Administrator 

22 deems appropriate; 

23 ‘‘(4) summarize any significant socio-economic 

24 impacts of climate change in the United States, in25 cluding the territories of the United States, drawing 


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1 on work by Federal agencies and the academic lit2 erature, including impacts on— 

3 ‘‘(A) public health; 

4 ‘‘(B) economic livelihoods and subsistence; 

5 ‘‘(C) displacement or permanent relocation 

6 due to flooding, severe weather, extended 

7 drought, erosion, or other ecosystem changes; 

8 ‘‘(D) human infrastructure, including 

9 coastal infrastructure vulnerability to extreme 

10 events and sea level rise, river floodplain infra11 structure, and sewer and water management 

12 systems; 

13 ‘‘(E) agriculture and forests, including ef14 fects on potential growing season, distribution, 

15 and yield; 

16 ‘‘(F) water resources for human consump17 tion, agriculture and natural and managed eco18 systems, flood and drought risks, and relative 

19 humidity; 

20 ‘‘(G) energy supply and use; and 

21 ‘‘(H) transportation; 

22 ‘‘(5) in assessing risks and impacts, use a risk 

23 management framework, including both qualitative 

24 and quantitative measures, to assess the observed 


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1 and projected impacts of current and future climate 

2 change, accounting for— 

3 ‘‘(A) both monetized and non-monetized 

4 losses; 

5 ‘‘(B) potential nonlinear, abrupt, or essen6 tially irreversible changes in the climate system; 

7 ‘‘(C) potential nonlinear increases in the 

8 cost of impacts; 

9 ‘‘(D) potential low-probability, high impact 

10 events; and 

11 ‘‘(E) whether impacts are transitory or es12 sentially permanent; and 

13 ‘‘(6) based on the findings of the Administrator 

14 under this section, as well as assessments produced 

15 by the Intergovernmental Panel on Climate Change, 

16 the United States Global Change Research program, 

17 and other relevant scientific entities— 

18 ‘‘(A) describe increased risks to natural 

19 systems and society that would result from an 

20 increase in global average temperature 3.6 de21 grees Fahrenheit (2 degrees Celsius) above the 

22 pre-industrial average or an increase in atmos23 pheric greenhouse gas concentrations above 450 

24 parts per million carbon dioxide equivalent; and 

25 ‘‘(B) identify and assess— 


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1 ‘‘(i) significant residual risks not 

2 avoided by the thresholds described in sub3 paragraph (A); 

4 ‘‘(ii) alternative thresholds or targets 

5 that may more effectively limit the risks 

6 identified pursuant to clause (i); and 

7 ‘‘(iii) thresholds above those described 

8 in subparagraph (A) which significantly in9 crease the risk of certain impacts or render 

10 them essentially permanent. 

11 ‘‘(d) STATUS OF MONITORING AND VERIFICATION

12 CAPABILITIES TO EVALUATE GREENHOUSE GAS REDUC13 TION EFFORTS.—The analysis required under subsection 

14 (a)(2) shall evaluate the capabilities of the monitoring, re15 porting, and verification systems used to quantify progress 

16 in achieving reductions in greenhouse gas emissions both 

17 globally and in the United States (as described in section 

18 702), including— 

19 ‘‘(1) quantification of emissions and emission 

20 reductions by entities participating in the cap and 

21 trade program under this title; 

22 ‘‘(2) quantification of emissions and emission 

23 reductions by entities participating in the offset pro24 gram under this title; 


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1 ‘‘(3) quantification of emission and emissions 

2 reductions by entities regulated by performance 

3 standards; 

4 ‘‘(4) quantification of aggregate net emissions 

5 and emissions reductions by the United States; and 

6 ‘‘(5) quantification of global changes in net 

7 emissions and in sources and sinks of greenhouse 

8 gases. 

9 ‘‘(e) STATUS OF GREENHOUSE GAS REDUCTION EF10 FORTS.—The analysis required under subsection (a)(3) 

11 shall address— 

12 ‘‘(1) whether the programs under Safe Climate 

13 Act and other Federal statutes are resulting in suffi14 cient United States greenhouse gas emissions reduc15 tions to meet the emissions reduction goals described 

16 in section 702, taking into account the use of off17 sets; and 

18 ‘‘(2) whether United States actions, taking into 

19 account international actions, commitments, and 

20 trends, and considering the range of plausible emis21 sions scenarios, are sufficient to avoid— 

22 ‘‘(A) atmospheric greenhouse gas con23 centrations above 450 parts per million carbon 

24 dioxide equivalent; 


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1 ‘‘(B) global average surface temperature 

2 3.6 degrees Fahrenheit (2 degrees Celsius) 

3 above the pre-industrial average, or such other 

4 temperature thresholds as the Administrator 

5 deems appropriate; and 

6 ‘‘(C) other temperature or greenhouse gas 

7 thresholds identified pursuant to subsection 

8 (c)(6)(B). 

9 ‘‘(f) RECOMMENDATIONS.— 

10 ‘‘(1) LATEST SCIENTIFIC INFORMATION.— 

11 Based on the analysis described in subsection (a)(1), 

12 each report under subsection (a) shall identify ac13 tions that could be taken to— 

14 ‘‘(A) improve the characterization of 

15 changes in the earth-climate system and im16 pacts of global climate change; 

17 ‘‘(B) better inform decision making and 

18 actions related to global climate change; 

19 ‘‘(C) mitigate risks to natural and social 

20 systems; and 

21 ‘‘(D) design policies to better account for 

22 climate risks. 

23 ‘‘(2) MONITORING, REPORTING AND

24 VERIFICATION.—Based on the analysis described in 

25 subsection (a)(2), each report under subsection (a) 


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1 shall identify key gaps in measurement, reporting, 

2 and verification capabilities and make recommenda3 tions to improve the accuracy and reliability of those 

4 capabilities. 

5 ‘‘(3) STATUS OF GREENHOUSE GAS REDUCTION

6 EFFORTS.—Based on the analysis described in sub7 section (a)(3), taking into account international ac8 tions, commitments, and trends, and considering the 

9 range of plausible emissions scenarios, each report 

10 under subsection (a) shall identify— 

11 ‘‘(A) the quantity of additional reductions 

12 required to meet the emissions reduction goals 

13 in section 702; 

14 ‘‘(B) the quantity of additional reductions 

15 in global greenhouse gas emissions needed to 

16 avoid the concentration and temperature 

17 thresholds identified in subsection (e); and 

18 ‘‘(C) possible strategies and approaches for 

19 achieving additional reductions. 

20 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There 

21 are authorized to be appropriated to carry out this section 

22 such sums as may be necessary. 

23 ‘‘SEC. 706. NATIONAL ACADEMY REVIEW. 

24 ‘‘(a) IN GENERAL.—Not later than 1 year after the 

25 date of enactment of this title, the Administrator shall 


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1 offer to enter into a contract with the National Academy 

2 of Sciences (in this section referred to as the ‘Academy’) 

3 under which the Academy shall, not later than July 1, 

4 2014, and every 4 years thereafter, submit to Congress 

5 and the Administrator a report that includes— 

6 ‘‘(1) a review of the most recent report and rec7 ommendations issued under section 705; and 

8 ‘‘(2) an analysis of technologies to achieve re9 ductions in greenhouse gas emissions. 

10 ‘‘(b) FAILURE TO ISSUE A REPORT.—In the event 

11 that the Administrator has not issued all or part of the 

12 most recent report required under section 705, the Acad13 emy shall conduct its own review and analysis of the re14 quired information. 

15 ‘‘(c) TECHNOLOGICAL INFORMATION.—The analysis 

16 required under subsection (a)(2) shall— 

17 ‘‘(1) review existing technological information 

18 and reports, including the most recent reports by the 

19 Department of Energy, the United States Global 

20 Change Research Program, the Intergovernmental 

21 Panel on Climate Change, and the International En22 ergy Agency and any other relevant information on 

23 technologies or practices that reduce or limit green24 house gas emissions; 


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1 ‘‘(2) include the participation of technical ex2 perts from relevant private industry sectors; 

3 ‘‘(3) review the current and future projected de4 ployment of technologies and practices in the United 

5 States that reduce or limit greenhouse gas emis6 sions, including— 

7 ‘‘(A) technologies for capture and seques8 tration of greenhouse gases; 

9 ‘‘(B) technologies to improve energy effi10 ciency; 

11 ‘‘(C) low- or zero-greenhouse gas emitting 

12 energy technologies; 

13 ‘‘(D) low- or zero-greenhouse gas emitting 

14 fuels; 

15 ‘‘(E) biological sequestration practices and 

16 technologies; and 

17 ‘‘(F) any other technologies the Academy 

18 deems relevant; and 

19 ‘‘(4) review and compare the emissions reduc20 tion potential, commercial viability, market penetra21 tion, investment trends, and deployment of the tech22 nologies described in paragraph (3), including— 

23 ‘‘(A) the need for additional research and 

24 development, including publicly funded research 

25 and development; 


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1 ‘‘(B) the extent of commercial deployment, 

2 including, where appropriate, a comparison to 

3 the cost and level of deployment of conventional 

4 fossil fuel-fired energy technologies and devices; 

5 and 

6 ‘‘(C) an evaluation of any substantial tech7 nological, legal, or market-based barriers to 

8 commercial deployment. 

9 ‘‘(d) RECOMMENDATIONS.— 

10 ‘‘(1) LATEST SCIENTIFIC INFORMATION.— 

11 Based on the review described in subsection (a)(1), 

12 the Academy shall identify actions that could be 

13 taken to— 

14 ‘‘(A) improve the characterization of 

15 changes in the earth-climate system and im16 pacts of global climate change; 

17 ‘‘(B) better inform decision making and 

18 actions related to global climate change; 

19 ‘‘(C) mitigate risks to natural and social 

20 systems; 

21 ‘‘(D) design policies to better account for 

22 climate risks; and 

23 ‘‘(E) improve the accuracy and reliability 

24 of capabilities to monitor, report, and verify 

25 greenhouse gas emissions reduction efforts. 


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1 ‘‘(2) TECHNOLOGICAL INFORMATION.—Based 

2 on the analysis described in subsection (a)(2), the 

3 Academy shall identify— 

4 ‘‘(A) additional emissions reductions that 

5 may be possible as a result of technologies de6 scribed in the analysis; 

7 ‘‘(B) barriers to the deployment of such 

8 technologies; and 

9 ‘‘(C) actions that could be taken to speed 

10 deployment of such technologies. 

11 ‘‘(3) STATUS OF GREENHOUSE GAS REDUCTION

12 EFFORTS.—Based on the review described in sub13 section (a)(1), the Academy shall identify— 

14 ‘‘(A) the quantity of additional reductions 

15 required to meet the emissions reduction goals 

16 described in section 702; and 

17 ‘‘(B) the quantity of additional reductions 

18 in global greenhouse gas emissions needed to 

19 avoid the concentration and temperature 

20 thresholds described in section 705(c)(6)(A) or 

21 identified pursuant to section 705(c)(6)(B). 

22 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There 

23 are authorized to be appropriated to carry out this section 

24 such sums as may be necessary. 


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1 ‘‘SEC. 707. PRESIDENTIAL RESPONSE AND RECOMMENDA2 TIONS. 

3 ‘‘(a) AGENCY ACTIONS.—The President shall direct 

4 relevant Federal agencies to use existing statutory author5 ity to take appropriate actions identified in the reports 

6 submitted under sections 705 and 706, and to address any 

7 shortfalls identified in such reports, not later than July 

8 1, 2015, and every 4 years thereafter. 

9 ‘‘(b) PLAN.—In the event that the Administrator or 

10 the National Academy of Sciences has concluded, in the 

11 most recent report submitted under section 705 or 706 

12 respectively, that the United States will not achieve the 

13 necessary domestic greenhouse gas emissions reductions, 

14 or that global actions will not maintain safe global average 

15 surface temperature and atmospheric greenhouse gas con16 centration thresholds, the President shall, not later than 

17 July 1, 2015, and every 4 years thereafter, submit to Con18 gress a plan identifying domestic and international actions 

19 that will achieve necessary additional greenhouse gas re20 ductions, including any recommendations for legislative 

21 action. 

22 ‘‘PART B—DESIGNATION AND REGISTRATION OF 

23 GREENHOUSE GASES 

24 ‘‘SEC. 711. DESIGNATION OF GREENHOUSE GASES. 

25 ‘‘(a) GREENHOUSE GASES.—For purposes of this 

26 title, the following are greenhouse gases: 


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1 ‘‘(1) Carbon dioxide. 

2 ‘‘(2) Methane. 

3 ‘‘(3) Nitrous oxide. 

4 ‘‘(4) Sulfur hexafluoride. 

5 ‘‘(5) Hydrofluorocarbons emitted from a chem6 ical manufacturing process at an industrial sta7 tionary source. 

8 ‘‘(6) Any perfluorocarbon. 

9 ‘‘(7) Nitrogen trifluoride. 

10 ‘‘(8) Any other anthropogenic gas designated as 

11 a greenhouse gas by the Administrator under this 

12 section. 

13 ‘‘(b) DETERMINATION ON ADMINISTRATOR’S INITIA14 TIVE.—The Administrator shall, by rule— 

15 ‘‘(1) determine whether 1 metric ton of another 

16 anthropogenic gas makes the same or greater con17 tribution to global warming over 100 years as 1 met18 ric ton of carbon dioxide; 

19 ‘‘(2) determine the carbon dioxide equivalent 

20 value for each gas with respect to which the Admin21 istrator makes an affirmative determination under 

22 paragraph (1); 

23 ‘‘(3) for each gas with respect to which the Ad24 ministrator makes an affirmative determination 

25 under paragraph (1) and that is used as a substitute 


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1 for a class I or class II substance under title VI, de2 termine the extent to which to regulate that gas 

3 under section 619 and specify appropriate compli4 ance obligations under section 619; 

5 ‘‘(4) designate as a greenhouse gas for purposes 

6 of this title each gas for which the Administrator 

7 makes an affirmative determination under para8 graph (1), to the extent that it is not regulated 

9 under section 619; and 

10 ‘‘(5) specify the appropriate compliance obliga11 tions under this title for each gas designated as a 

12 greenhouse gas under paragraph (4). 

13 ‘‘(c) PETITIONS TO DESIGNATE A GREENHOUSE

14 GAS.— 

15 ‘‘(1) IN GENERAL.—Any person may petition 

16 the Administrator to designate as a greenhouse gas 

17 any anthropogenic gas 1 metric ton of which makes 

18 the same or greater contribution to global warming 

19 over 100 years as 1 metric ton of carbon dioxide. 

20 ‘‘(2) CONTENTS OF PETITION.—The petitioner 

21 shall provide sufficient data, as specified by rule by 

22 the Administrator, to demonstrate that the gas is 

23 likely to be designated as a greenhouse gas and is 

24 likely to be produced, imported, used, or emitted in 

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1 titioner shall also identify producers, importers, dis2 tributors, users, and emitters of the gas in the 

3 United States. 

4 ‘‘(3) REVIEW AND ACTION BY THE ADMINIS5 TRATOR.—Not later than 90 days after receipt of a 

6 petition under paragraph (2), the Administrator 

7 shall determine whether the petition is complete and 

8 notify the petitioner and the public of the decision. 

9 ‘‘(4) ADDITIONAL INFORMATION.—The Admin10 istrator may require producers, importers, distribu11 tors, users, or emitters of the gas to provide infor12 mation on the contribution of the gas to global 

13 warming over 100 years compared to carbon dioxide. 

14 ‘‘(5) TREATMENT OF PETITION.—For any sub15 stance used as a substitute for a class I or class II 

16 substance under title VI, the Administrator may 

17 elect to treat a petition under this subsection as a 

18 petition to list the substance as a class II, group II 

19 substance under section 619, and may require the 

20 petition to be amended to address listing criteria 

21 promulgated under that section. 

22 ‘‘(6) DETERMINATION.—Not later than 2 years 

23 after receipt of a complete petition, the Adminis24 trator shall, after notice and an opportunity for com25 ment— 


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1 ‘‘(A) issue and publish in the Federal Reg2 ister— 

3 ‘‘(i) a determination that 1 metric ton 

4 of the gas does not make a contribution to 

5 global warming over 100 years that is 

6 equal to or greater than that made by 1 

7 metric ton of carbon dioxide; and 

8 ‘‘(ii) an explanation of the decision; or 

9 ‘‘(B) determine that 1 metric ton of the 

10 gas makes a contribution to global warming 

11 over 100 years that is equal to or greater than 

12 that made by 1 metric ton of carbon dioxide, 

13 and take the actions described in subsection (b) 

14 with respect to such gas. 

15 ‘‘(7) GROUNDS FOR DENIAL.—The Adminis16 trator may not deny a petition under this subsection 

17 solely on the basis of inadequate Environmental Pro18 tection Agency resources or time for review. 

19 ‘‘(d) SCIENCE ADVISORY BOARD CONSULTATION.— 

20 ‘‘(1) CONSULTATION.—The Administrator 

21 shall— 

22 ‘‘(A) give notice to the Science Advisory 

23 Board prior to making a determination under 

24 subsection (b)(1), (c)(6), or (e)(2)(B); 


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1 ‘‘(B) consider the written recommendations 

2 of the Science Advisory Board under paragraph 

3 (2) regarding the determination; and 

4 ‘‘(C) consult with the Science Advisory 

5 Board regarding such determination, including 

6 consultation subsequent to receipt of such writ7 ten recommendations. 

8 ‘‘(2) FORMULATION OF RECOMMENDATIONS.— 

9 Upon receipt of notice under paragraph (1)(A) re10 garding a pending determination under subsection 

11 (b)(1), (c)(6), or (e)(2)(B), the Science Advisory 

12 Board shall— 

13 ‘‘(A) formulate recommendations regarding 

14 such determination, subject to a peer review 

15 process; and 

16 ‘‘(B) submit such recommendations in 

17 writing to the Administrator. 

18 ‘‘(e) MANUFACTURING AND EMISSION NOTICES.— 

19 ‘‘(1) NOTICE REQUIREMENT.— 

20 ‘‘(A) IN GENERAL.—Effective 24 months 

21 after the date of enactment of this title, no per22 son may manufacture or introduce into inter23 state commerce a fluorinated gas, or emit a sig24 nificant quantity, as determined by the Admin25 istrator, of any fluorinated gas that is genVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00547 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 erated as a byproduct during the production or 

2 use of another fluorinated gas, unless— 

3 ‘‘(i) the gas is designated as a green4 house gas under this section or is an 

5 ozone-depleting substance listed as a class 

6 I or class II substance under title VI; 

7 ‘‘(ii) the Administrator has deter8 mined that 1 metric ton of such gas does 

9 not make a contribution to global warming 

10 over 100 years that is equal to or greater 

11 than that made by 1 metric ton of carbon 

12 dioxide; or 

13 ‘‘(iii) the person manufacturing or im14 porting the gas for distribution into inter15 state commerce, or emitting the gas, has 

16 submitted to the Administrator, at least 90 

17 days before the start of such manufacture, 

18 introduction into commerce, or emission, a 

19 notice of such person’s manufacture, intro20 duction into commerce, or emission of such 

21 gas, and the Administrator has not deter22 mined that that notice or a substantially 

23 similar notice submitted by that person is 

24 incomplete. 


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1 ‘‘(B) ALTERNATIVE COMPLIANCE.—For a 

2 gas that is a substitute for a class I or class II 

3 substance under title VI and either has been 

4 listed as acceptable for use under section 612 

5 or is currently subject to evaluation under sec6 tion 612, the Administrator may accept the no7 tice and information provided pursuant to that 

8 section as fulfilling the obligation under clause 

9 (iii) of subparagraph (A). 

10 ‘‘(2) REVIEW AND ACTION BY THE ADMINIS11 TRATOR.— 

12 ‘‘(A) COMPLETENESS.—Not later than 90 

13 days after receipt of notice under paragraph 

14 (1)(A)(iii) or (B), the Administrator shall deter15 mine whether the notice is complete. 

16 ‘‘(B) DETERMINATION.— If the Adminis17 trator determines that the notice is complete, 

18 the Administrator shall, after notice and an op19 portunity for comment, not later than 12 

20 months after receipt of the notice— 

21 ‘‘(i) issue and publish in the Federal 

22 Register— 

23 ‘‘(I) a determination that 1 met24 ric ton of the gas does not make a 

25 contribution to global warming over 


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1 100 years that is equal to or greater 

2 than that made by 1 metric ton of 

3 carbon dioxide; and 

4 ‘‘(II) an explanation of the deci5 sion; or 

6 ‘‘(ii) determine that 1 metric ton of 

7 the gas makes a contribution to global 

8 warming over 100 years that is equal to or 

9 greater than that made by 1 metric ton of 

10 carbon dioxide, and take the actions de11 scribed in subsection (b) with respect to 

12 such gas. 

13 ‘‘(f) REGULATIONS.—Not later than one year after 

14 the date of enactment of this title, the Administrator shall 

15 promulgate regulations to carry out this section. Such reg16 ulations shall include— 

17 ‘‘(1) requirements for the contents of a petition 

18 submitted under subsection (c); 

19 ‘‘(2) requirements for the contents of a notice 

20 required under subsection (e); and 

21 ‘‘(3) methods and standards for evaluating the 

22 carbon dioxide equivalent value of a gas. 

23 ‘‘(g) GASES REGULATED UNDER TITLE VI.—The 

24 Administrator shall not designate a gas as a greenhouse 


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1 gas under this section to the extent that the gas is regu2 lated under title VI. 

3 ‘‘(h) SAVINGS CLAUSE.—Nothing in this section shall 

4 be interpreted to relieve any person from complying with 

5 the requirements of section 612. 

6 ‘‘SEC. 712. CARBON DIOXIDE EQUIVALENT VALUE OF 

7 GREENHOUSE GASES. 

8 ‘‘(a) MEASURE OF QUANTITY OF GREENHOUSE

9 GASES.—Any provision of this title or title VIII that refers 

10 to a quantity or percentage of a quantity of greenhouse 

11 gases shall mean the quantity or percentage of the green12 house gases expressed in carbon dioxide equivalents. 

13 ‘‘(b) INITIAL VALUE.—Except as provided by the Ad14 ministrator under this section or section 711— 

15 ‘‘(1) the carbon dioxide equivalent value of 

16 greenhouse gases for purposes of this Act shall be as 

17 follows: 

‘‘CARBON DIOXIDE EQUIVALENT OF 1 TON OF LISTED 

GREENHOUSE GASES 

Greenhouse gas (1 metric ton) Carbon dioxide equivalent 

(metric tons) 

Carbon dioxide 1 

Methane 25 

Nitrous oxide 298 

HFC-23 14,800 

HFC-125 3,500 

HFC-134a 1,430 


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‘‘CARBON DIOXIDE EQUIVALENT OF 1 TON OF LISTED 

GREENHOUSE GASES—Continued 

Greenhouse gas (1 metric ton) Carbon dioxide equivalent 

(metric tons) 

HFC-143a 4,470 

HFC-152a 124 

HFC-227ea 3,220 

HFC-236fa 9,810 

HFC-4310mee 1,640 

CF4 7,390 

C2F6 12,200 

C4F10 8,860 

C6F14 9,300 

SF6 22,800 

NF3 17,200 

1 ; and 

2 ‘‘(2) the carbon dioxide equivalent value for 

3 purposes of this Act for any greenhouse gas not list4 ed in the table under paragraph (1) shall be the 

5 100-year Global Warming Potentials provided in the 

6 Intergovernmental Panel on Climate Change Fourth 

7 Assessment Report. 

8 ‘‘(c) PERIODIC REVIEW.— 

9 ‘‘(1) Not later than February 1, 2017, and (ex10 cept as provided in paragraph (3)) not less than 

11 every 5 years thereafter, the Administrator shall— 

12 ‘‘(A) review and, if appropriate, revise the 

13 carbon dioxide equivalent values established 


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1 under this section or section 711(b)(2), based 

2 on a determination of the number of metric 

3 tons of carbon dioxide that makes the same 

4 contribution to global warming over 100 years 

5 as 1 metric ton of each greenhouse gas; and 

6 ‘‘(B) publish in the Federal Register the 

7 results of that review and any revisions. 

8 ‘‘(2) A revised determination published in the 

9 Federal Register under paragraph (1)(B) shall take 

10 effect for greenhouse gas emissions starting on Jan11 uary 1 of the first calendar year starting at least 9 

12 months after the date on which the revised deter13 mination was published. 

14 ‘‘(3) The Administrator may decrease the fre15 quency of review and revision under paragraph (1) 

16 if the Administrator determines that such decrease 

17 is appropriate in order to synchronize such review 

18 and revision with any similar review process carried 

19 out pursuant to the United Nations Framework 

20 Convention on Climate Change, done at New York 

21 on May 9, 1992, or to an agreement negotiated 

22 under that convention, except that in no event shall 

23 the Administrator carry out such review and revision 

24 any less frequently than every 10 years. 


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1 ‘‘(d) METHODOLOGY.—In setting carbon dioxide 

2 equivalent values, for purposes of this section or section 

3 711, the Administrator shall take into account publica4 tions by the Intergovernmental Panel on Climate Change 

5 or a successor organization under the auspices of the 

6 United Nations Environmental Programme and the World 

7 Meteorological Organization. 

8 ‘‘SEC. 713. GREENHOUSE GAS REGISTRY. 

9 ‘‘(a) DEFINITIONS.—For purposes of this section: 

10 ‘‘(1) CLIMATE REGISTRY.—The term ‘Climate 

11 Registry’ means the greenhouse gas emissions reg12 istry jointly established and managed by more than 

13 40 States and Indian tribes in 2007 to collect high14 quality greenhouse gas emission data from facilities, 

15 corporations, and other organizations to support var16 ious greenhouse gas emission reporting and reduc17 tion policies for the member States and Indian 

18 tribes. 

19 ‘‘(2) REPORTING ENTITY.—The term ‘reporting 

20 entity’ means— 

21 ‘‘(A) a covered entity; 

22 ‘‘(B) an entity that— 

23 ‘‘(i) would be a covered entity if it had 

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1 quent year more than the applicable 

2 threshold level in the definition of covered 

3 entity in paragraph (13) of section 700; 

4 and 

5 ‘‘(ii) has emitted, produced, imported, 

6 manufactured, or delivered in 2008 or any 

7 subsequent year more than the applicable 

8 threshold level in the definition of covered 

9 entity in paragraph (13) of section 700, 

10 provided that the figure of 25,000 tons of 

11 carbon dioxide equivalent is read instead 

12 as 10,000 tons of carbon dioxide equivalent 

13 and the figure of 460,000,000 cubic feet is 

14 read instead as 184,000,000 cubic feet; 

15 ‘‘(C) any other entity that emits a green16 house gas, or produces, imports, manufactures, 

17 or delivers material whose use results or may 

18 result in greenhouse gas emissions if the Ad19 ministrator determines that reporting under 

20 this section by such entity will help achieve the 

21 purposes of this title or title VIII; 

22 ‘‘(D) any vehicle fleet with emissions of 

23 more than 25,000 tons of carbon dioxide equiv24 alent on an annual basis, if the Administrator 

25 determines that the inclusion of such fleet will 


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1 help achieve the purposes of this title or title 

2 VIII; or 

3 ‘‘(E) any entity that delivers electricity to 

4 a facility in an energy-intensive industrial sec5 tor that meets the energy or greenhouse gas in6 tensity criteria in section 764(b)(2)(A)(i). 

7 ‘‘(b) REGULATIONS.— 

8 ‘‘(1) IN GENERAL.—Not later than 6 months 

9 after the date of enactment of this title, the Admin10 istrator shall issue regulations establishing a Federal 

11 greenhouse gas registry. Such regulations shall— 

12 ‘‘(A) require reporting entities to submit to 

13 the Administrator data on— 

14 ‘‘(i) greenhouse gas emissions in the 

15 United States; 

16 ‘‘(ii) the production and manufacture 

17 in the United States, importation into the 

18 United States, and, at the discretion of the 

19 Administrator, exportation from the 

20 United States, of fuels and industrial gases 

21 the uses of which result or may result in 

22 greenhouse gas emissions; 

23 ‘‘(iii) deliveries in the United States of 

24 natural gas, and any other gas meeting the 

25 specifications for commingling with natural 


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1 gas for purposes of delivery, the combus2 tion of which result or may result in green3 house gas emissions; and 

4 ‘‘(iv) the capture and sequestration of 

5 greenhouse gases; 

6 ‘‘(B) require covered entities and, where 

7 appropriate, other reporting entities to submit 

8 to the Administrator data sufficient to ensure 

9 compliance with or implementation of the re10 quirements of this title; 

11 ‘‘(C) require reporting of electricity deliv12 ered to facilities in an energy-intensive indus13 trial sector that meets the energy or greenhouse 

14 gas intensity criteria in section 764(b)(2)(A)(i); 

15 ‘‘(D) ensure the completeness, consistency, 

16 transparency, accuracy, precision, and reliability 

17 of such data; 

18 ‘‘(E) take into account the best practices 

19 from the most recent Federal, State, tribal, and 

20 international protocols for the measurement, ac21 counting, reporting, and verification of green22 house gas emissions, including protocols from 

23 the Climate Registry and other mandatory 

24 State or multistate authorized programs; 


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1 ‘‘(F) take into account the latest scientific 

2 research; 

3 ‘‘(G) require that, for covered entities with 

4 respect to greenhouse gases to which section 

5 722 applies, and, to the extent determined to be 

6 appropriate by the Administrator, for covered 

7 entities with respect to other greenhouse gases 

8 and for other reporting entities, submitted data 

9 are based on— 

10 ‘‘(i) continuous monitoring systems 

11 for fuel flow or emissions, such as contin12 uous emission monitoring systems; 

13 ‘‘(ii) alternative systems that are dem14 onstrated as providing data with the same 

15 precision, reliability, accessibility, and 

16 timeliness, or, to the extent the Adminis17 trator determines is appropriate for report18 ing small amounts of emissions, the same 

19 precision, reliability, and accessibility and 

20 similar timeliness, as data provided by con21 tinuous monitoring systems for fuel flow or 

22 emissions; or 

23 ‘‘(iii) alternative methodologies that 

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1 ness, or, to the extent the Administrator 

2 determines is appropriate for reporting 

3 small amounts of emissions, precision, reli4 ability, and accessibility, as similar as is 

5 technically feasible to that of data gen6 erally provided by continuous monitoring 

7 systems for fuel flow or emissions, if the 

8 Administrator determines that, with re9 spect to a reporting entity, there is no con10 tinuous monitoring system or alternative 

11 system described in clause (i) or (ii) that 

12 is technically feasible; 

13 ‘‘(H) require that the Administrator, in de14 termining the extent to which the requirement 

15 to use systems or methodologies in accordance 

16 with subparagraph (G) is appropriate for re17 porting entities other than covered entities or 

18 for greenhouse gases to which section 722 does 

19 not apply, consider the cost of using such sys20 tems and methodologies, and of using other sys21 tems and methodologies that are available and 

22 suitable, for quantifying the emissions involved 

23 in light of the purposes of this title, including 

24 the goal of collecting consistent entity-wide 

25 data; 


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1 ‘‘(I) include methods for minimizing double 

2 reporting and avoiding irreconcilable double re3 porting of greenhouse gas emissions; 

4 ‘‘(J) establish measurement protocols for 

5 carbon capture and sequestration systems, tak6 ing into consideration the regulations promul7 gated under section 813; 

8 ‘‘(K) require that reporting entities provide 

9 the data required under this paragraph in re10 ports submitted electronically to the Adminis11 trator, in such form and containing such infor12 mation as may be required by the Adminis13 trator; 

14 ‘‘(L) include requirements for keeping 

15 records supporting or related to, and protocols 

16 for auditing, submitted data; 

17 ‘‘(M) establish consistent policies for calcu18 lating carbon content and greenhouse gas emis19 sions for each type of fossil fuel with respect to 

20 which reporting is required; 

21 ‘‘(N) subsequent to implementation of poli22 cies developed under subparagraph (M), provide 

23 for immediate dissemination, to States, Indian 

24 tribes, and on the Internet, of all data reported 

25 under this section as soon as practicable after 


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1 electronic audit by the Administrator and any 

2 resulting correction of data, except that data 

3 shall not be disseminated under this subpara4 graph if— 

5 ‘‘(i) its nondissemination is vital to 

6 the national security of the United States, 

7 as determined by the President; or 

8 ‘‘(ii) it is confidential business infor9 mation that cannot be derived from infor10 mation that is otherwise publicly available 

11 and that would cause significant calculable 

12 competitive harm if published, except 

13 that— 

14 ‘‘(I) data relating to greenhouse 

15 gas emissions, including any upstream 

16 or verification data from reporting en17 tities, shall not be considered to be 

18 confidential business information; and 

19 ‘‘(II) data that is confidential 

20 business information shall be provided 

21 to a State or Indian tribe within 

22 whose jurisdiction the reporting entity 

23 is located, if the Administrator deter24 mines that such State or Indian tribe 

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1 tial business information that are at 

2 least as protective as protections ap3 plicable to the Federal Government; 

4 ‘‘(O) prescribe methods by which the Ad5 ministrator shall, in cases in which satisfactory 

6 data are not submitted to the Administrator for 

7 any period of time, estimate emission, produc8 tion, importation, manufacture, or delivery lev9 els— 

10 ‘‘(i) for covered entities with respect 

11 to greenhouse gas emissions, production, 

12 importation, manufacture, or delivery regu13 lated under this title to ensure that emis14 sions, production, importation, manufac15 ture, or deliveries are not underreported, 

16 and to create a strong incentive for meet17 ing data monitoring and reporting require18 ments— 

19 ‘‘(I) with a conservative estimate 

20 of the highest emission, production, 

21 importation, manufacture, or delivery 

22 levels that may have occurred during 

23 the period for which data are missing; 

24 or 


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1 ‘‘(II) to the extent the Adminis2 trator considers appropriate, with an 

3 estimate of such levels assuming the 

4 unit is emitting, producing, importing, 

5 manufacturing, or delivering at a 

6 maximum potential level during the 

7 period, in order to ensure that such 

8 levels are not underreported and to 

9 create a strong incentive for meeting 

10 data monitoring and reporting re11 quirements; and 

12 ‘‘(ii) for covered entities with respect 

13 to greenhouse gas emissions to which sec14 tion 722 does not apply and for other re15 porting entities, with a reasonable estimate 

16 of the emission, production, importation, 

17 manufacture, or delivery levels that may 

18 have occurred during the period for which 

19 data are missing; 

20 ‘‘(P) require the designation of a des21 ignated representative for each reporting entity; 

22 ‘‘(Q) require an appropriate certification, 

23 by the designated representative for the report24 ing entity, of accurate and complete accounting 


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1 of greenhouse gas emissions, as determined by 

2 the Administrator; and 

3 ‘‘(R) include requirements for other data 

4 necessary for accurate and complete accounting 

5 of greenhouse gas emissions, as determined by 

6 the Administrator, including data for quality 

7 assurance of monitoring systems, monitors and 

8 other measurement devices, and other data 

9 needed to verify reported emissions, production, 

10 importation, manufacture, or delivery. 

11 ‘‘(2) TIMING.— 

12 ‘‘(A) CALENDAR YEARS 2007 THROUGH

13 2010.—For a base period of calendar years 

14 2007 through 2010, each reporting entity shall 

15 submit annual data required under this section 

16 to the Administrator not later than March 31, 

17 2011. The Administrator may waive or modify 

18 reporting requirements for calendar years 2007 

19 through 2010 for categories of reporting enti20 ties to the extent that the Administrator deter21 mines that the reporting entities did not keep 

22 data or records necessary to meet reporting re23 quirements. The Administrator may, in addition 

24 to or in lieu of such requirements, collect infor25 mation on energy consumption and production. 


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1 ‘‘(B) SUBSEQUENT CALENDAR YEARS.— 

2 For calendar year 2011 and each subsequent 

3 calendar year, each reporting entity shall sub4 mit quarterly data required under this section 

5 to the Administrator not later than 60 days 

6 after the end of the applicable quarter, except 

7 when the data is already being reported to the 

8 Administrator on an earlier timeframe for an9 other program. 

10 ‘‘(3) WAIVER OF REPORTING REQUIREMENTS.— 

11 The Administrator may waive reporting require12 ments under this section for specific entities to the 

13 extent that the Administrator determines that suffi14 cient and equally or more reliable verified and timely 

15 data are available to the Administrator and the pub16 lic on the Internet under other mandatory statutory 

17 requirements. 

18 ‘‘(4) ALTERNATIVE THRESHOLD.—The Admin19 istrator may, by rule, establish applicability thresh20 olds for reporting under this section using alter21 native metrics and levels, provided that such metrics 

22 and levels are easier to administer and cover the 

23 same size and type of sources as the threshold de24 fined in this section. 


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1 ‘‘(c) INTERRELATIONSHIP WITH OTHER SYSTEMS.— 

2 In developing the regulations issued under subsection (b), 

3 the Administrator shall take into account the work done 

4 by the Climate Registry and other mandatory State or 

5 multistate programs. Such regulations shall include an ex6 planation of any major differences in approach between 

7 the system established under the regulations and such reg8 istries and programs. 

9 ‘‘PART C—PROGRAM RULES 

10 ‘‘SEC. 721. EMISSION ALLOWANCES. 

11 ‘‘(a) IN GENERAL.—The Administrator shall estab12 lish a separate quantity of emission allowances for each 

13 calendar year starting in 2012, in the amounts prescribed 

14 under subsection (e). 

15 ‘‘(b) IDENTIFICATION NUMBERS.—The Adminis16 trator shall assign to each emission allowance established 

17 under subsection (a) a unique identification number that 

18 includes the vintage year for that emission allowance. 

19 ‘‘(c) LEGAL STATUS OF EMISSION ALLOWANCES.— 

20 ‘‘(1) IN GENERAL.—An allowance established 

21 by the Administrator under this title does not con22 stitute a property right, nor does any credit or other 

23 instrument established or issued under the American 

24 Clean Energy and Security Act of 2009, and the 


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1 amendments made thereby, for the purpose of dem2 onstrating compliance with this title. 

3 ‘‘(2) TERMINATION OR LIMITATION.—Nothing 

4 in this Act or any other provision of law shall be 

5 construed to limit or alter the authority of the 

6 United States, including the Administrator acting 

7 pursuant to statutory authority, to terminate or 

8 limit allowances or offset credits. 

9 ‘‘(3) OTHER PROVISIONS UNAFFECTED.—Ex10 cept as otherwise specified in this Act, nothing in 

11 this Act relating to allowances or offset credits es12 tablished or issued under this title shall affect the 

13 application of any other provision of law to a covered 

14 entity, or the responsibility for a covered entity to 

15 comply with any such provision of law. 

16 ‘‘(d) SAVINGS PROVISION.—Nothing in this part shall 

17 be construed as requiring a change of any kind in any 

18 State law regulating electric utility rates and charges, or 

19 as affecting any State law regarding such State regula20 tion, or as limiting State regulation (including any 

21 prudency review) under such a State law. Nothing in this 

22 part shall be construed as modifying the Federal Power 

23 Act or as affecting the authority of the Federal Energy 

24 Regulatory Commission under that Act. Nothing in this 

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1 gram for competitive bidding for power supply in a State 

2 in which such program is established. 

3 ‘‘(e) ALLOWANCES FOR EACH CALENDAR YEAR.— 

4 ‘‘(1) IN GENERAL.—Except as provided in para5 graph (2), the number of emission allowances estab6 lished by the Administrator under subsection (a) for 

7 each calendar year shall be as provided in the fol8 lowing table: 

‘‘Calendar year Emission allowances (in millions) 

2012 4,627 

2013 4,544 

2014 5,099 

2015 5,003 

2016 5,482 

2017 5,375 

2018 5,269 

2019 5,162 

2020 5,056 

2021 4,903 

2022 4,751 

2023 4,599 

2024 4,446 

2025 4,294 

2026 4,142 

2027 3,990 

2028 3,837 


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‘‘Calendar year Emission allowances (in millions) 

2029 3,685 

2030 3,533 

2031 3,408 

2032 3,283 

2033 3,158 

2034 3,033 

2035 2,908 

2036 2,784 

2037 2,659 

2038 2,534 

2039 2,409 

2040 2,284 

2041 2,159 

2042 2,034 

2043 1,910 

2044 1,785 

2045 1,660 

2046 1,535 

2047 1,410 

2048 1,285 

2049 1,160 

2050 and each year thereafter 1,035 

1 ‘‘(2) REVISION.— 

2 ‘‘(A) IN GENERAL.—The Administrator 

3 may adjust, in accordance with subparagraph 

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1 lished pursuant to paragraph (1) if, after notice 

2 and an opportunity for public comment, the Ad3 ministrator determines that— 

4 ‘‘(i) United States greenhouse gas 

5 emissions in 2005 were other than 7,206 

6 million metric tons carbon dioxide equiva7 lent; 

8 ‘‘(ii) if the requirements of this title 

9 for 2012 had been in effect in 2005, sec10 tion 722 would have required emission al11 lowances to be held for other than 66.2 

12 percent of United States greenhouse gas 

13 emissions in 2005; 

14 ‘‘(iii) if the requirements of this title 

15 for 2014 had been in effect in 2005, sec16 tion 722 would have required emission al17 lowances to be held for other than 75.7 

18 percent of United States greenhouse gas 

19 emissions in 2005; or 

20 ‘‘(iv) if the requirements of this title 

21 for 2016 had been in effect in 2005, sec22 tion 722 would have required emission al23 lowances to be held for other than 84.5 

24 percent United States greenhouse gas 

25 emissions in 2005. 


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1 ‘‘(B) ADJUSTMENT FORMULA.— 

2 ‘‘(i) IN GENERAL.—If the Adminis3 trator adjusts under this paragraph the 

4 number of emission allowances established 

5 pursuant to paragraph (1), the number of 

6 emission allowances the Administrator es7 tablishes for any given calendar year shall 

8 equal the product of— 

9 ‘‘(I) United States greenhouse 

10 gas emissions in 2005, expressed in 

11 tons of carbon dioxide equivalent; 

12 ‘‘(II) the percent of United 

13 States greenhouse gas emissions in 

14 2005, expressed in tons of carbon di15 oxide equivalent, that would have been 

16 subject to section 722 if the require17 ments of this title for the given cal18 endar year had been in effect in 2005; 

19 and 

20 ‘‘(III) the percentage set forth 

21 for that calendar year in section 

22 703(a), or determined under clause 

23 (ii) of this subparagraph. 

24 ‘‘(ii) TARGETS.—In applying the por25 tion of the formula in clause (i)(III) of this 


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1 subparagraph, for calendar years for which 

2 a percentage is not listed in section 703(a), 

3 the Administrator shall use a uniform an4 nual decline in the amount of emissions be5 tween the years that are specified. 

6 ‘‘(iii) CARBON DIOXIDE EQUIVALENT

7 VALUE.—If the Administrator adjusts 

8 under this paragraph the number of emis9 sion allowances established pursuant to 

10 paragraph (1), the Administrator shall use 

11 the carbon dioxide equivalent values estab12 lished pursuant to section 712. 

13 ‘‘(iv) LIMITATION ON ADJUSTMENT

14 TIMING.—Once a calendar year has start15 ed, the Administrator may not adjust the 

16 number of emission allowances to be estab17 lished for that calendar year. 

18 ‘‘(C) LIMITATION ON ADJUSTMENT AU19 THORITY.—The Administrator may adjust 

20 under this paragraph the number of emission 

21 allowances to be established pursuant to para22 graph (1) only once. 

23 ‘‘(f) COMPENSATORY ALLOWANCE.— 

24 ‘‘(1) IN GENERAL.—The regulations promul25 gated under subsection (h) shall provide for the esVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00572 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tablishment and distribution of compensatory allow2 ances for— 

3 ‘‘(A) the destruction, in 2012 or later, of 

4 fluorinated gases that are greenhouse gases if— 

5 ‘‘(i) allowances or offset credits were 

6 retired for their production or importation; 

7 and 

8 ‘‘(ii) such gases are not required to be 

9 destroyed under any other provision of law; 

10 ‘‘(B) the nonemissive use, in 2012 or later, 

11 of petroleum-based or coal-based liquid or gas12 eous fuel, petroleum coke, natural gas liquid, or 

13 natural gas as a feedstock, if allowances or off14 set credits were retired for the greenhouse 

15 gases that would have been emitted from their 

16 combustion; and 

17 ‘‘(C) the conversionary use, in 2012 or 

18 later, of fluorinated gases in a manufacturing 

19 process, including semiconductor research or 

20 manufacturing, if allowances or offset credits 

21 were retired for the production or importation 

22 of such gas. 

23 ‘‘(2) ESTABLISHMENT AND DISTRIBUTION.— 

24 ‘‘(A) IN GENERAL.—Not later than 90 

25 days after the end of each calendar year, the 


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1 Administrator shall establish and distribute to 

2 the entity taking the actions described in sub3 paragraph (A), (B), or (C) of paragraph (1) a 

4 quantity of compensatory allowances equivalent 

5 to the number of tons of carbon dioxide equiva6 lent of avoided emissions achieved through such 

7 actions. In establishing the quantity of compen8 satory allowances, the Administrator shall take 

9 into account the carbon dioxide equivalent value 

10 of any greenhouse gas resulting from such ac11 tion. 

12 ‘‘(B) SOURCE OF ALLOWANCES.—Compen13 satory allowances established under this sub14 section shall not be emission allowances estab15 lished under subsection (a). 

16 ‘‘(C) IDENTIFICATION NUMBERS.—The 

17 Administrator shall assign to each compen18 satory allowance established under subpara19 graph (A) a unique identification number. 

20 ‘‘(3) DEFINITIONS.—For purposes of this sub21 section— 

22 ‘‘(A) the term ‘destruction’ means the con23 version of a greenhouse gas by thermal, chem24 ical, or other means to another gas or set of 


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1 gases with little or no carbon dioxide equivalent 

2 value; 

3 ‘‘(B) the term ‘nonemissive use’ means the 

4 use of fossil fuel as a feedstock in an industrial 

5 or manufacturing process to the extent that 

6 greenhouse gases are not emitted from such 

7 process, and to the extent that the products of 

8 such process are not intended for use as, or to 

9 be contained in, a fuel; and 

10 ‘‘(C) the term ‘conversionary use’ means 

11 the conversion during research or manufac12 turing of a fluorinated gas into another green13 house gas or set of gases with a lower carbon 

14 dioxide equivalent value. 

15 ‘‘(4) FEEDSTOCK EMISSIONS STUDY.— 

16 ‘‘(A) The Administrator may conduct a 

17 study to determine the extent to which petro18 leum-based or coal-based liquid or gaseous fuel, 

19 petroleum coke, natural gas liquid, or natural 

20 gas are used as feedstocks in manufacturing 

21 processes to produce products and the green22 house gas emissions resulting from such uses. 

23 ‘‘(B) If as a result of such a study, the Ad24 ministrator determines that the use of such 

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1 stantial emissions of greenhouse gases and that 

2 such emissions have not been adequately ad3 dressed under other requirements of this Act, 

4 the Administrator may, after notice and com5 ment rulemaking, promulgate a regulation re6 ducing compensatory allowances commen7 surately if doing so will not result in shifting 

8 such emissions to noncovered sources. 

9 ‘‘(g) FLUORINATED GASES ASSESSMENT.—No later 

10 than March 31, 2014, the Administrator shall complete 

11 an assessment of the regulation of non-HFC fluorinated 

12 gases under this title to determine whether the most ap13 propriate point of regulation is at the gas manufacturer 

14 or importer level, or at the source of emissions down15 stream. If the Administrator determines, based on consid16 eration of environmental effectiveness, cost effectiveness, 

17 administrative feasibility, extent of coverage of emissions, 

18 competitiveness and other relevant considerations con19 sistent with the purposes of this title, that emissions of 

20 non-HFC fluorinated gases can best be regulated by desig21 nating downstream emission sources as covered entities 

22 with compliance obligations under section 722, the Admin23 istrator shall, after notice and comment rulemaking, 

24 change the definition of covered entity and the compliance 

25 obligations under section 722 with respect to non-HFC 


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1 fluorinated gases accordingly, consistent with the purposes 

2 of this title, and establish such other requirements as are 

3 necessary to ensure compliance for such entities with the 

4 requirements of this title. 

5 ‘‘(h) REGULATIONS.—Not later than 24 months after 

6 the date of enactment of this title, the Administrator shall 

7 promulgate regulations to carry out the provisions of this 

8 title. 

9 ‘‘SEC. 722. PROHIBITION OF EXCESS EMISSIONS. 

10 ‘‘(a) PROHIBITION.—Except as provided in sub11 section (c), effective January 1, 2012, each covered entity 

12 is prohibited from emitting greenhouse gases and having 

13 attributable greenhouse gas emissions, in combination, in 

14 excess of its allowable emissions level. A covered entity’s 

15 allowable emissions level for each calendar year is the 

16 number of emission allowances (or credits or other allow17 ances as provided in subsection (d)) it holds as of 12:01 

18 a.m. on April 1 (or a later date established by the Admin19 istrator under subsection (j)) of the following calendar 

20 year. 

21 ‘‘(b) METHODS OF DEMONSTRATING COMPLIANCE.— 

22 Except as otherwise provided in this section, the owner 

23 or operator of a covered entity shall not be considered to 

24 be in compliance with the prohibition in subsection (a) un25 less, as of 12:01 a.m. on April 1 (or a later date estabVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00577 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 lished by the Administrator under subsection (j)) of each 

2 calendar year starting in 2013, the owner or operator 

3 holds a quantity of emission allowances (or credits or other 

4 allowances as provided in subsection (d)) at least as great 

5 as the quantity calculated as follows: 

6 ‘‘(1) ELECTRICITY SOURCES.—For a covered 

7 entity described in section 700(13)(A), 1 emission 

8 allowance for each ton of carbon dioxide equivalent 

9 of greenhouse gas that such covered entity emitted 

10 in the previous calendar year, excluding emissions 

11 resulting from the combustion of— 

12 ‘‘(A) petroleum-based or coal-based liquid 

13 fuel; 

14 ‘‘(B) natural gas liquid; 

15 ‘‘(C) renewable biomass or gas derived 

16 from renewable biomass; or 

17 ‘‘(D) petroleum coke or gas derived from 

18 petroleum coke. 

19 ‘‘(2) FUEL PRODUCERS AND IMPORTERS.—For 

20 a covered entity described in section 700(13)(B), 1 

21 emission allowance for each ton of carbon dioxide 

22 equivalent of greenhouse gas that would be emitted 

23 from the combustion of any petroleum-based or coal24 based liquid fuel, petroleum coke, or natural gas liq25 uid, produced or imported by such covered entity 


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1 during the previous calendar year for sale or dis2 tribution in interstate commerce, assuming no cap3 ture and sequestration of any greenhouse gas emis4 sions. 

5 ‘‘(3) INDUSTRIAL GAS PRODUCERS AND IM6 PORTERS.—For a covered entity described in section 

7 700(13)(C), 1 emission allowance for each ton of 

8 carbon dioxide equivalent of fossil fuel-based carbon 

9 dioxide, nitrous oxide, or any other fluorinated gas 

10 that is a greenhouse gas (except for nitrogen 

11 trifluoride), or any combination thereof, produced or 

12 imported by such covered entity during the previous 

13 calendar year for sale or distribution in interstate 

14 commerce. 

15 ‘‘(4) NITROGEN TRIFLUORIDE SOURCES.—For 

16 a covered entity described in section 700(13)(D), 1 

17 emission allowance for each ton of carbon dioxide 

18 equivalent of nitrogen trifluoride that such covered 

19 entity emitted in the previous calendar year. 

20 ‘‘(5) GEOLOGICAL SEQUESTRATION SITES.—For 

21 a covered entity described in section 700(13)(E), 1 

22 emission allowance for each ton of carbon dioxide 

23 equivalent of greenhouse gas that such covered enti24 ty emitted in the previous calendar year. 


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1 ‘‘(6) INDUSTRIAL STATIONARY SOURCES.—For 

2 a covered entity described in section 700(13)(F), 

3 (G), or (H), 1 emission allowance for each ton of 

4 carbon dioxide equivalent of greenhouse gas that 

5 such covered entity emitted in the previous calendar 

6 year, excluding emissions resulting from— 

7 ‘‘(A) the combustion of petroleum-based or 

8 coal-based liquid fuel; 

9 ‘‘(B) the combustion of natural gas liquid; 

10 ‘‘(C) the combustion of renewable biomass 

11 or gas derived from renewable biomass; 

12 ‘‘(D) the combustion of petroleum coke or 

13 gas derived from petroleum coke; or 

14 ‘‘(E) the use of any fluorinated gas that is 

15 a greenhouse gas purchased for use at that cov16 ered entity, except for nitrogen trifluoride. 

17 ‘‘(7) INDUSTRIAL FOSSIL FUEL-FIRED COMBUS18 TION DEVICES.—For a covered entity described in 

19 section 700(13)(I), 1 emission allowance for each 

20 ton of carbon dioxide equivalent of greenhouse gas 

21 that the devices emitted in the previous calendar 

22 year, excluding emissions resulting from the combus23 tion of— 

24 ‘‘(A) petroleum-based or coal-based liquid 

25 fuel; 


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1 ‘‘(B) natural gas liquid; 

2 ‘‘(C) renewable biomass or gas derived 

3 from renewable biomass; or 

4 ‘‘(D) petroleum coke or gas derived from 

5 petroleum coke. 

6 ‘‘(8) NATURAL GAS LOCAL DISTRIBUTION COM7 PANIES.—For a covered entity described in section 

8 700(13)(J), 1 emission allowance for each ton of 

9 carbon dioxide equivalent of greenhouse gas that 

10 would be emitted from the combustion of the natural 

11 gas, and any other gas meeting the specifications for 

12 commingling with natural gas for purposes of deliv13 ery, that such entity delivered during the previous 

14 calendar year to customers that are not covered enti15 ties, assuming no capture and sequestration of that 

16 greenhouse gas. 

17 ‘‘(9) ALGAE-BASED FUELS.—Where carbon di18 oxide (or another greenhouse gas) generated by a 

19 covered entity is used as an input in the production 

20 of algae-based fuels, the Administrator shall ensure 

21 that emission allowances are required to be held ei22 ther for the carbon dioxide generated by a covered 

23 entity that is used to grow the algae or for the por24 tion of the carbon dioxide emitted from combustion 

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1 utable to carbon dioxide generated by a covered enti2 ty, but not for both. 

3 ‘‘(10) FUGITIVE EMISSIONS.—The greenhouse 

4 gas emissions to which paragraphs (1), (4), (6), and 

5 (7) apply shall not include fugitive emissions of 

6 greenhouse gas, except to the extent the Adminis7 trator determines that data on the carbon dioxide 

8 equivalent value of greenhouse gas in the fugitive 

9 emissions can be provided with sufficient precision, 

10 reliability, accessibility, and timeliness to ensure the 

11 integrity of emission allowances, the allowance track12 ing system, and the cap on emissions. 

13 ‘‘(11) EXPORT EXEMPTION.—This section shall 

14 not apply to any petroleum-based or coal-based liq15 uid fuel, petroleum coke, natural gas liquid, fossil 

16 fuel-based carbon dioxide, nitrous oxide, or 

17 fluorinated gas that is exported for sale or use. 

18 ‘‘(12) NATURAL GAS LIQUIDS.—For natural gas 

19 liquids, the covered entity subject to the requirement 

20 stated in paragraph (2) shall be the owner of the 

21 natural gas liquids at the point the natural gas liq22 uids are separated into merchantable products. 

23 ‘‘(13) APPLICATION OF MULTIPLE PARA24 GRAPHS.—For a covered entity to which more than 

25 1 of paragraphs (1) through (8) apply, all applicable 


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1 paragraphs shall apply, except that not more than 1 

2 emission allowance shall be required for the same 

3 emission. 

4 ‘‘(14) APPLICATION TO FRACTIONS OF TONS.— 

5 In applying paragraphs (1) through (8), any amount 

6 less than 1 ton of carbon dioxide equivalent of emis7 sions or attributable greenhouse gas emissions shall 

8 be treated as 1 ton of such carbon dioxide equiva9 lent. 

10 ‘‘(c) PHASE-IN OF PROHIBITION.— 

11 ‘‘(1) INDUSTRIAL STATIONARY SOURCES.—The 

12 prohibition under subsection (a) shall first apply to 

13 a covered entity described in section 700(13)(D), 

14 (F), (G), (H), or (I), with respect to emissions oc15 curring during calendar year 2014. 

16 ‘‘(2) NATURAL GAS LOCAL DISTRIBUTION COM17 PANIES.—The prohibition under subsection (a) shall 

18 first apply to a covered entity described in section 

19 700(13)(J) with respect to deliveries occurring dur20 ing calendar year 2016. 

21 ‘‘(d) ADDITIONAL METHODS.—In addition to using 

22 the method of compliance described in subsection (b), a 

23 covered entity may do the following: 

24 ‘‘(1) OFFSET CREDITS.— 


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1 ‘‘(A) IN GENERAL.—Covered entities col2 lectively may, in accordance with this para3 graph, use offset credits to demonstrate compli4 ance for up to a maximum of 2 billion tons of 

5 greenhouse gas emissions annually. The ability 

6 to demonstrate compliance with offset credits 

7 shall be divided pro rata among covered entities 

8 by allowing each covered entity to satisfy a per9 centage of the number of allowances required to 

10 be held under subsection (b) to demonstrate 

11 compliance by holding 1 domestic offset credit 

12 or 1.25 international offset credits in lieu of an 

13 emission allowance, except as provided in sub14 paragraph (D). 

15 ‘‘(B) APPLICABLE PERCENTAGE.—The 

16 percentage referred to in subparagraph (A) for 

17 a given calendar year shall be determined by di18 viding 2 billion by the sum of 2 billion plus the 

19 number of emission allowances established 

20 under section 721(a) for the previous year, and 

21 multiplying that number by 100. Not more than 

22 one half of the applicable percentage under this 

23 paragraph may be used by holding domestic off24 set credits, and not more than one half of the 

25 applicable percentage under this paragraph may 


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1 be used by holding international offset credits, 

2 except as provided in subparagraph (C). 

3 ‘‘(C) MODIFIED PERCENTAGES.—If the 

4 Administrator determines that domestic offset 

5 credits available for use in demonstrating com6 pliance in any calendar year at domestic offset 

7 prices generally equal to or less than emission 

8 allowance prices, are likely to offset less than 

9 0.9 billion tons of greenhouse gas emissions 

10 (measured in tons of carbon dioxide equiva11 lents), for purposes of compliance demonstra12 tion in that year the Administrator shall— 

13 ‘‘(i) increase the percentage of emis14 sions that can be offset through the use of 

15 international offset credits to reflect the 

16 amount that 1.0 billion exceeds the number 

17 of domestic offset credits the Adminis18 trator determines is available, at prices 

19 generally equal to or less than emission al20 lowance prices, for that year, up to a max21 imum of 0.5 billion tons of greenhouse gas 

22 emissions; and 

23 ‘‘(ii) decrease the percentage of emis24 sions that can be offset through the use of 


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1 domestic offset credits by the same 

2 amount. 

3 ‘‘(D) INTERNATIONAL OFFSET CREDITS.— 

4 Notwithstanding subparagraph (A), to dem5 onstrate compliance prior to calendar year 

6 2018, a covered entity may use 1 international 

7 offset credit in lieu of an emission allowance up 

8 to the amount permitted under this paragraph. 

9 ‘‘(E) PRESIDENT’S RECOMMENDATION.— 

10 The President may make a recommendation to 

11 Congress as to whether the number 2 billion 

12 specified in subparagraphs (A) and (B) should 

13 be increased or decreased. 

14 ‘‘(2) INTERNATIONAL EMISSION ALLOW15 ANCES.—To demonstrate compliance, a covered enti16 ty may hold an international emission allowance in 

17 lieu of an emission allowance, except as modified 

18 under section 728(d). 

19 ‘‘(3) COMPENSATORY ALLOWANCES.—To dem20 onstrate compliance, a covered entity may hold a 

21 compensatory allowance obtained under section 

22 721(f) in lieu of an emission allowance. 

23 ‘‘(e) RETIREMENT OF ALLOWANCES AND CREDITS.— 

24 As soon as practicable after a deadline established for cov25 ered entities to demonstrate compliance with this title, the 


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1 Administrator shall retire the quantity of allowances or 

2 credits required to be held under this title. 

3 ‘‘(f) ALTERNATIVE METRICS.—For categories of cov4 ered entities described in subparagraph (B), (C), (D), (G), 

5 (H), or (I) of section 700(13), the Administrator may, by 

6 rule, establish an applicability threshold for inclusion 

7 under those subparagraphs using an alternative metric 

8 and level, provided that such metric and level are easier 

9 to administer and cover the same size and type of sources 

10 as the threshold defined in such subparagraphs. 

11 ‘‘(g) THRESHOLD REVIEW.—For each category of 

12 covered entities described in subparagraph (B), (C), (D), 

13 (G), (H), or (I) of section 700(13), the Administrator 

14 shall, in 2020 and once every 8 years thereafter, review 

15 the carbon dioxide equivalent emission threshold that is 

16 used to define covered entities in such category. After con17 sideration of— 

18 ‘‘(1) emissions from covered entities in such 

19 category, and from other entities of the same type 

20 that emit less than the threshold amount for the cat21 egory (including emission sources that commence op22 eration after the date of enactment of this title that 

23 are not covered entities); and 


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1 ‘‘(2) whether greater greenhouse gas emission 

2 reductions can be cost-effectively achieved by low3 ering the applicable threshold, 

4 the Administrator may by rule lower such threshold to not 

5 less than 10,000 tons of carbon dioxide equivalent emis6 sions. In determining the cost effectiveness of potential re7 ductions from lowering the threshold for covered entities, 

8 the Administrator shall consider alternative regulatory 

9 greenhouse gas programs, including setting standards 

10 under other titles of this Act. 

11 ‘‘(h) DESIGNATED REPRESENTATIVES.—The regula12 tions promulgated under section 721(h) shall require that 

13 each covered entity, and each entity holding allowances or 

14 offset credits or receiving allowances or offset credits from 

15 the Administrator under this title, submit to the Adminis16 trator a certificate of representation designating a des17 ignated representative. 

18 ‘‘(i) EDUCATION AND OUTREACH.— 

19 ‘‘(1) IN GENERAL.—The Administrator shall es20 tablish and carry out a program of education and 

21 outreach to assist covered entities, especially entities 

22 having little experience with environmental regu23 latory requirements similar or comparable to those 

24 under this title, in preparing to meet the compliance 

25 obligations of this title. Such program shall include 


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1 education with respect to using markets to effec2 tively achieve such compliance. 

3 ‘‘(2) FAILURE TO RECEIVE INFORMATION.—A 

4 failure to receive information or assistance under 

5 this subsection may not be used as a defense against 

6 an allegation of any violation of this title. 

7 ‘‘(j) ADJUSTMENT OF DEADLINE.—The Adminis8 trator may, by rule, establish a deadline for demonstrating 

9 compliance, for a calendar year, later than the date pro10 vided in subsection (a), as necessary to ensure the avail11 ability of emissions data, but in no event shall the deadline 

12 be later than June 1. 

13 ‘‘(k) NOTICE REQUIREMENT FOR COVERED ENTI14 TIES RECEIVING NATURAL GAS FROM NATURAL GAS

15 LOCAL DISTRIBUTION COMPANIES.—The owner or oper16 ator of a covered entity that takes delivery of natural gas 

17 from a natural gas local distribution company shall, not 

18 later than September 1 of each calendar year, notify such 

19 natural gas local distribution company in writing that 

20 such entity will qualify as a covered entity under this title 

21 for that calendar year. 

22 ‘‘(l) COMPLIANCE OBLIGATION.—For purposes of 

23 this title, the year of a compliance obligation is the year 

24 in which compliance is determined, not the year in which 


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1 the greenhouse gas emissions occur or the covered entity 

2 has attributable greenhouse gas emissions. 

3 ‘‘SEC. 723. PENALTY FOR NONCOMPLIANCE. 

4 ‘‘(a) ENFORCEMENT.—A violation of any prohibition 

5 of, requirement of, or regulation promulgated pursuant to 

6 this title shall be a violation of this Act. It shall be a viola7 tion of this Act for a covered entity to emit greenhouse 

8 gases and have attributable greenhouse gas emissions, in 

9 combination, in excess of its allowable emissions level as 

10 provided in section 722(a). Each ton of carbon dioxide 

11 equivalent for which a covered entity fails to demonstrate 

12 compliance under section 722 shall be a separate violation. 

13 ‘‘(b) EXCESS EMISSIONS PENALTY.— 

14 ‘‘(1) IN GENERAL.—The owner or operator of 

15 any covered entity that fails for any year to comply, 

16 on the deadline described in section 722(a) or (j), 

17 shall be liable for payment to the Administrator of 

18 an excess emissions penalty in the amount described 

19 in paragraph (2). 

20 ‘‘(2) AMOUNT.—The amount of an excess emis21 sions penalty required to be paid under paragraph 

22 (1) shall be equal to the product obtained by multi23 plying— 

24 ‘‘(A) the tons of carbon dioxide equivalent 

25 of greenhouse gas emissions or attributable 


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1 greenhouse gas emissions for which the owner 

2 or operator of a covered entity failed to dem3 onstrate compliance under section 722 on the 

4 deadline; by 

5 ‘‘(B) twice the auction clearing price for 

6 the earliest vintage year emission allowances in 

7 the last auction carried out pursuant to section 

8 791 before such deadline. 

9 ‘‘(3) TIMING.—An excess emissions penalty re10 quired under this subsection shall be immediately 

11 due and payable to the Administrator, without de12 mand, in accordance with regulations promulgated 

13 by the Administrator, which shall be issued not later 

14 than 2 years after the date of enactment of this 

15 title. 

16 ‘‘(4) NO EFFECT ON LIABILITY.—An excess 

17 emissions penalty due and payable by the owners or 

18 operators of a covered entity under this subsection 

19 shall not diminish the liability of the owners or oper20 ators for any fine, penalty, or assessment against 

21 the owners or operators for the same violation under 

22 any other provision of this Act or any other law. 

23 ‘‘(c) EXCESS EMISSIONS ALLOWANCES.—The owner 

24 or operator of a covered entity that fails for any year to 

25 comply on the deadline described in section 722(a) or (j) 


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1 shall be liable to offset the covered entity’s excess com2 bination of greenhouse gases emitted and attributable 

3 greenhouse gas emissions by an equal quantity of emission 

4 allowances during the following calendar year, or such 

5 longer period as the Administrator may prescribe. During 

6 the year in which the covered entity failed to comply, or 

7 any year thereafter, the Administrator may deduct the 

8 emission allowances required under this subsection to off9 set the covered entity’s excess greenhouse gas emissions 

10 or attributable greenhouse gas emissions. 

11 ‘‘SEC. 724. TRADING. 

12 ‘‘(a) PERMITTED TRANSACTIONS.—Except as other13 wise provided in this title, the lawful holder of an emission 

14 allowance, compensatory allowance, or offset credit may, 

15 without restriction, sell, exchange, transfer, hold for com16 pliance in accordance with section 722, or request that the 

17 Administrator retire the emission allowance, compensatory 

18 allowance, or offset credit. 

19 ‘‘(b) NO RESTRICTION ON TRANSACTIONS.—The 

20 privilege of purchasing, holding, selling, exchanging, 

21 transferring, and requesting retirement of emission allow22 ances, compensatory allowances, or offset credits shall not 

23 be restricted to the owners and operators of covered enti24 ties, except as otherwise provided in this title. 


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1 ‘‘(c) EFFECTIVENESS OF ALLOWANCE TRANS2 FERS.—No transfer of an allowance or offset credit shall 

3 be effective for purposes of this title until a certification 

4 of the transfer, signed by the designated representative of 

5 the transferor, is received and recorded by the Adminis6 trator in accordance with regulations promulgated under 

7 section 721(h). 

8 ‘‘(d) ALLOWANCE TRACKING SYSTEM.—The regula9 tions promulgated under section 721(h) shall include a 

10 system for issuing, recording, holding, and tracking allow11 ances and offset credits that shall specify all necessary 

12 procedures and requirements for an orderly and competi13 tive functioning of the allowance and offset credit markets. 

14 Such regulations shall provide for appropriate publication 

15 of the information in the system on the Internet. 

16 ‘‘SEC. 725. BANKING AND BORROWING. 

17 ‘‘(a) BANKING.—An emission allowance may be used 

18 to comply with section 722 or section 723 for emissions 

19 in— 

20 ‘‘(1) the vintage year for the allowance; or 

21 ‘‘(2) any calendar year subsequent to the vin22 tage year for the allowance. 

23 ‘‘(b) EXPIRATION.— 

24 ‘‘(1) REGULATIONS.—The Administrator may 

25 establish by regulation criteria and procedures for 


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1 determining whether, and for implementing a deter2 mination that, the expiration of an allowance or off3 set credit established or issued by the Administrator 

4 under this title, or expiration of the ability to use an 

5 international emission allowance to comply with sec6 tion 722, is necessary to ensure the authenticity and 

7 integrity of allowances or offset credits or the allow8 ance tracking system. 

9 ‘‘(2) GENERAL RULE.—An allowance or offset 

10 credit established or issued by the Administrator 

11 under this title shall not expire unless— 

12 ‘‘(A) it is retired by the Administrator pur13 suant to this title; or 

14 ‘‘(B) it is determined to expire or to have 

15 expired by a specific date by the Administrator 

16 in accordance with regulations promulgated 

17 under paragraph (1). 

18 ‘‘(3) INTERNATIONAL EMISSION ALLOW19 ANCES.—The ability to use an international emission 

20 allowance to comply with section 722 shall not ex21 pire unless— 

22 ‘‘(A) the allowance is retired by the Ad23 ministrator pursuant to this title; or 

24 ‘‘(B) the ability to use such allowance to 

25 meet such compliance obligation requirements is 


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1 determined to expire or to have expired by a 

2 specific date by the Administrator in accord3 ance with regulations promulgated under para4 graph (1). 

5 ‘‘(c) BORROWING FUTURE VINTAGE YEAR ALLOW6 ANCES.— 

7 ‘‘(1) BORROWING WITHOUT INTEREST.—In ad8 dition to the uses described in subsection (a), an 

9 emission allowance may be used to demonstrate com10 pliance under section 722 or comply with section 

11 723 for emissions, production, importation, manu12 facture, or deliveries in the calendar year imme13 diately preceding the vintage year for the allowance. 

14 ‘‘(2) BORROWING WITH INTEREST.— 

15 ‘‘(A) IN GENERAL.—A covered entity may 

16 demonstrate compliance under section 722 in a 

17 specific calendar year for up to 15 percent of 

18 its emissions by holding emission allowances 

19 with a vintage year 1 to 5 years later than that 

20 calendar year. 

21 ‘‘(B) LIMITATIONS.—An emission allow22 ance borrowed pursuant to this paragraph shall 

23 be an emission allowance that is established by 

24 the Administrator for a specific future calendar 


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1 year under section 721(a) and that is held by 

2 the borrower. 

3 ‘‘(C) PREPAYMENT OF INTEREST.—For 

4 each emission allowance that an owner or oper5 ator of a covered entity borrows pursuant to 

6 this paragraph, such owner or operator shall, at 

7 the time it borrows the allowance, hold for re8 tirement by the Administrator, and the Admin9 istrator shall retire, a quantity of emission al10 lowances that is equal to the product obtained 

11 by multiplying— 

12 ‘‘(i) 0.08; by 

13 ‘‘(ii) the number of years between the 

14 calendar year in which the allowance is 

15 being used to satisfy a compliance obliga16 tion and the vintage year of the allowance. 

17 ‘‘SEC. 726. STRATEGIC RESERVE. 

18 ‘‘(a) STRATEGIC RESERVE AUCTIONS.— 

19 ‘‘(1) IN GENERAL.—Once each quarter of each 

20 calendar year for which allowances are established 

21 under section 721(a), the Administrator shall auc22 tion strategic reserve allowances. 

23 ‘‘(2) RESTRICTION TO COVERED ENTITIES.—In 

24 each auction conducted under paragraph (1), only 

25 covered entities that the Administrator expects will 


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1 be required to comply with section 722 in the fol2 lowing calendar year shall be eligible to make pur3 chases. 

4 ‘‘(b) POOL OF EMISSION ALLOWANCES FOR STRA5 TEGIC RESERVE AUCTIONS.— 

6 ‘‘(1) FILLING THE STRATEGIC RESERVE INI7 TIALLY.— 

8 ‘‘(A) IN GENERAL.—The Administrator 

9 shall, not later than 2 years after the date of 

10 enactment of this title, establish a strategic re11 serve account, and shall place in that account 

12 an amount of emission allowances established 

13 under section 721(a) for each calendar year 

14 from 2012 through 2050 in the amounts speci15 fied in subparagraph (B) of this paragraph. 

16 ‘‘(B) AMOUNT.—The amount referred to in 

17 subparagraph (A) shall be— 

18 ‘‘(i) for each of calendar years 2012 

19 through 2019, 1 percent of the quantity of 

20 emission allowances established for that 

21 year pursuant to section 721(e)(1); 

22 ‘‘(ii) for each of calendar years 2020 

23 through 2029, 2 percent of the quantity of 

24 emission allowances established for that 

25 year pursuant to section 721(e)(1); and 


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1 ‘‘(iii) for each of calendar years 2030 

2 through 2050, 3 percent of the quantity of 

3 emission allowances established for that 

4 year pursuant to section 721(e)(1). 

5 ‘‘(C) EFFECT ON OTHER PROVISIONS.— 

6 Any provision in this title (except for subpara7 graph (B) of this paragraph) that refers to a 

8 quantity or percentage of the emission allow9 ances established for a calendar year under sec10 tion 721(a) shall be considered to refer to the 

11 amount of emission allowances as determined 

12 pursuant to section 721(e), less any emission 

13 allowances established for that year that are 

14 placed in the strategic reserve account under 

15 this paragraph. 

16 ‘‘(2) SUPPLEMENTING THE STRATEGIC RE17 SERVE.—The Administrator shall also— 

18 ‘‘(A) at the end of each calendar year, 

19 transfer to the strategic reserve account each 

20 emission allowance that was offered for sale but 

21 not sold at any auction conducted under section 

22 791; and 

23 ‘‘(B) deposit emission allowances estab24 lished under subsection (g) from auction pro25 ceeds into the strategic reserve, to the extent 


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1 necessary to maintain the reserve at its original 

2 size. 

3 ‘‘(c) MINIMUM STRATEGIC RESERVE AUCTION

4 PRICE.— 

5 ‘‘(1) IN GENERAL.—At each strategic reserve 

6 auction, the Administrator shall offer emission al7 lowances for sale beginning at a minimum price per 

8 emission allowance, which shall be known as the 

9 ‘minimum strategic reserve auction price’. 

10 ‘‘(2) INITIAL MINIMUM STRATEGIC RESERVE

11 AUCTION PRICES.—The minimum strategic reserve 

12 auction price shall be $28 (in constant 2009 dollars) 

13 for the strategic reserve auctions held in 2012. For 

14 the strategic reserve auctions held in 2013 and 

15 2014, the minimum strategic reserve auction price 

16 shall be the strategic reserve auction price for the 

17 previous year increased by 5 percent plus the rate of 

18 inflation (as measured by the Consumer Price Index 

19 for All Urban Consumers). 

20 ‘‘(3) MINIMUM STRATEGIC RESERVE AUCTION

21 PRICE IN SUBSEQUENT YEARS.—For each strategic 

22 reserve auction held in 2015 and each year there23 after, the minimum strategic reserve auction price 

24 shall be 60 percent above a rolling 36-month average 

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1 lowance vintage as reported on registered carbon 

2 trading facilities, calculated using constant dollars. 

3 ‘‘(d) QUANTITY OF EMISSION ALLOWANCES RE4 LEASED FROM THE STRATEGIC RESERVE.— 

5 ‘‘(1) INITIAL LIMITS.—For each of calendar 

6 years 2012 through 2016, the annual limit on the 

7 number of emission allowances from the strategic re8 serve account that may be auctioned is an amount 

9 equal to 5 percent of the emission allowances estab10 lished for that calendar year under section 721(a). 

11 This limit does not apply to international offset 

12 credits sold on consignment pursuant to subsection 

13 (h). 

14 ‘‘(2) LIMITS IN SUBSEQUENT YEARS.—For cal15 endar year 2017 and each year thereafter, the an16 nual limit on the number of emission allowances 

17 from the strategic reserve account that may be auc18 tioned is an amount equal to 10 percent of the emis19 sion allowances established for that calendar year 

20 under section 721(a). This limit does not apply to 

21 international offset credits sold on consignment pur22 suant to subsection (h). 

23 ‘‘(3) ALLOCATION OF LIMITATION.—One-fourth 

24 of each year’s annual strategic reserve auction limit 

25 under this subsection shall be made available for 


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1 auction in each quarter. Any allowances from the 

2 strategic reserve account that are made available for 

3 sale in a quarterly auction and not sold shall be 

4 rolled over and added to the quantity available for 

5 sale in the following quarter, except that allowances 

6 not sold at auction in the fourth quarter of a year 

7 shall not be rolled over to the following calendar 

8 year’s auctions, but shall be returned to the stra9 tegic reserve account. 

10 ‘‘(e) PURCHASE LIMIT.— 

11 ‘‘(1) IN GENERAL.—Except as provided in para12 graph (2) or (3), the annual number of emission al13 lowances that a covered entity may purchase at the 

14 strategic reserve auctions in each calendar year shall 

15 not exceed 20 percent of the covered entity’s com16 bined greenhouse gas emissions and attributable 

17 greenhouse gas emissions during the most recent 

18 year for which allowances or offset credits were re19 tired under section 722. 

20 ‘‘(2) 2012 LIMIT.—For calendar year 2012, the 

21 maximum aggregate number of emission allowances 

22 that a covered entity may purchase from that year’s 

23 strategic reserve auctions shall be 20 percent of the 

24 covered entity’s combined greenhouse gas emissions 

25 and attributable greenhouse gas emissions that the 


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1 covered entity reported to the registry established 

2 under section 713 for 2011 and that would be sub3 ject to section 722(a) if occurring in later calendar 

4 years. 

5 ‘‘(3) NEW ENTRANTS.—The Administrator 

6 shall, by regulation, establish a separate purchase 

7 limit applicable to entities that expect to become a 

8 covered entity in the year of the auction, permitting 

9 them to purchase emission allowances at the stra10 tegic reserve auctions in their first calendar year of 

11 operation in an amount of at least 20 percent of 

12 their expected combined greenhouse gas emissions 

13 and attributable greenhouse gas emissions for that 

14 year. 

15 ‘‘(f) DELEGATION OR CONTRACT.—Pursuant to regu16 lations under this section, the Administrator may, by dele17 gation or contract, provide for the conduct of strategic re18 serve auctions under the Administrator’s supervision by 

19 other departments or agencies of the Federal Government 

20 or by nongovernmental agencies, groups, or organizations. 

21 ‘‘(g) USE OF AUCTION PROCEEDS.— 

22 ‘‘(1) DEPOSIT IN STRATEGIC RESERVE FUND.— 

23 The proceeds from strategic reserve auctions shall be 

24 placed in the Strategic Reserve Fund established 

25 under section 793(1), and shall be available without 


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1 further appropriation or fiscal year limitation for the 

2 purposes described in this subsection. 

3 ‘‘(2) INTERNATIONAL OFFSET CREDITS FOR RE4 DUCED DEFORESTATION.—The Administrator shall 

5 use the proceeds from each strategic reserve auction 

6 to purchase international offset credits issued for re7 duced deforestation activities pursuant to section 

8 743(e). The Administrator shall retire those inter9 national offset credits and establish a number of 

10 emission allowances equal to 80 percent of the num11 ber of international offset credits so retired. Emis12 sion allowances established under this paragraph 

13 shall be in addition to those established under sec14 tion 721(a). 

15 ‘‘(3) EMISSION ALLOWANCES.—The Adminis16 trator shall deposit emission allowances established 

17 under paragraph (2) in the strategic reserve, except 

18 that, with respect to any such emission allowances in 

19 excess of the amount necessary to fill the strategic 

20 reserve to its original size, the Administrator shall— 

21 ‘‘(A) except as provided in subparagraph 

22 (B), assign a vintage year to the emission al23 lowance, which shall be no earlier than the year 

24 in which the allowance is established under 

25 paragraph (2), and shall treat such allowances 


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1 as ones that are not designated for distribution 

2 or auction for purposes of section 782(q) and 

3 (r); and 

4 ‘‘(B) to the extent any such allowances 

5 cannot be assigned a vintage year because of 

6 the limitation in paragraph (4), retire the allow7 ances. 

8 ‘‘(4) LIMITATION.—In no case may the Admin9 istrator assign under paragraph (3)(A) more emis10 sion allowances to a vintage year than the number 

11 of emission allowances from that vintage year that 

12 were placed in the strategic reserve account under 

13 subsection (b)(1). 

14 ‘‘(h) AVAILABILITY OF INTERNATIONAL OFFSET

15 CREDITS FOR AUCTION.— 

16 ‘‘(1) IN GENERAL.—The regulations promul17 gated under section 721(h) shall allow any entity 

18 holding international offset credits from reduced de19 forestation issued under section 743(e) to request 

20 that the Administrator include such offset credits in 

21 an upcoming strategic reserve auction. The regula22 tions shall provide that— 

23 ‘‘(A) such international offset credits will 

24 be used to fill bid orders only after the supply 


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1 of strategic reserve allowances available for sale 

2 at that auction has been depleted; 

3 ‘‘(B) international offset credits may be 

4 sold at a strategic reserve auction under this 

5 subsection only if the Administrator determines 

6 that it is highly likely that covered entities will, 

7 to cover emissions occurring in the year the 

8 auction is held, use offset credits to dem9 onstrate compliance under section 722 for emis10 sions equal to or greater than 80 percent of 2 

11 billion tons of carbon dioxide equivalent; 

12 ‘‘(C) upon sale of such international offset 

13 credits, the Administrator shall retire those 

14 international offset credits, and establish and 

15 provide to the purchasers a number of emission 

16 allowances equal to 80 percent of the number of 

17 international offset credits so retired, which al18 lowances shall be in addition to those estab19 lished under section 721(a); and 

20 ‘‘(D) for international offset credits sold 

21 pursuant to this subsection, the proceeds for 

22 the entity that offered the international offset 

23 credits for sale shall be the lesser of— 

24 ‘‘(i) the average daily closing price for 

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1 istered exchanges (or if such price is un2 available, the average price as determined 

3 by the Administrator) during the six 

4 months prior to the strategic reserve auc5 tion at which they were auctioned, with the 

6 remaining funds collected upon the sale of 

7 the international offset credits deposited in 

8 the Treasury; and 

9 ‘‘(ii) the amount received for the 

10 international offset credits at the auction. 

11 ‘‘(2) PROCEEDS.—For international offset cred12 its sold pursuant to this subsection, notwithstanding 

13 section 3302 of title 31, United States Code, or any 

14 other provision of law, within 90 days of receipt, the 

15 United States shall transfer the proceeds from the 

16 auction, as defined in paragraph (1)(D), to the enti17 ty that offered the international offset credits for 

18 sale. No funds transferred from a purchaser to a 

19 seller of international offset credits under this para20 graph shall be held by any officer or employee of the 

21 United States or treated for any purpose as public 

22 monies. 

23 ‘‘(3) PRICING.—When the Administrator acts 

24 under this subsection as the agent of an entity in 

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1 istrator is not obligated to obtain the highest price 

2 possible for the international offset credits, and in3 stead shall auction such international offset credits 

4 in the same manner and pursuant to the same rules 

5 (except as modified in paragraph (1)) as set forth 

6 for auctioning strategic reserve allowances. Entities 

7 requesting that such international offset credits be 

8 offered for sale at a strategic reserve auction may 

9 not set a minimum reserve price for their inter10 national offset credits that is different than the min11 imum strategic reserve auction price set pursuant to 

12 subsection (c). 

13 ‘‘(i) INITIAL REGULATIONS.—Not later than 24 

14 months after the date of enactment of this title, the Ad15 ministrator shall promulgate regulations, in consultation 

16 with other appropriate agencies, governing the auction of 

17 allowances under this section. Such regulations shall in18 clude the following requirements: 

19 ‘‘(1) FREQUENCY; FIRST AUCTION.—Auctions 

20 shall be held four times per year at regular intervals, 

21 with the first auction to be held no later than March 

22 31, 2012. 

23 ‘‘(2) AUCTION FORMAT.—Auctions shall follow 

24 a single-round, sealed-bid, uniform price format. 


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1 ‘‘(3) PARTICIPATION; FINANCIAL ASSURANCE.— 

2 Auctions shall be open to any covered entity eligible 

3 to purchase emission allowances at the auction 

4 under subsection (a)(2), except that the Adminis5 trator may establish financial assurance require6 ments to ensure that auction participants can and 

7 will perform on their bids. 

8 ‘‘(4) DISCLOSURE OF BENEFICIAL OWNER9 SHIP.—Each bidder in an auction shall be required 

10 to disclose the person or entity sponsoring or bene11 fitting from the bidder’s participation in the auction 

12 if such person or entity is, in whole or in part, other 

13 than the bidder. 

14 ‘‘(5) PURCHASE LIMITS.—No person may, di15 rectly or in concert with another participant, pur16 chase more than 20 percent of the allowances of17 fered for sale at any quarterly auction. 

18 ‘‘(6) PUBLICATION OF INFORMATION.—After 

19 the auction, the Administrator shall, in a timely 

20 fashion, publish the identities of winning bidders, 

21 the quantity of allowances obtained by each winning 

22 bidder, and the auction clearing price. 

23 ‘‘(7) OTHER REQUIREMENTS.—The Adminis24 trator may include in the regulations such other re25 quirements or provisions as the Administrator, in 


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1 consultation with other agencies as appropriate, con2 siders appropriate to promote effective, efficient, 

3 transparent, and fair administration of auctions 

4 under this section. 

5 ‘‘(j) REVISION OF REGULATIONS.—The Adminis6 trator may, at any time, in consultation with other agen7 cies as appropriate, revise the initial regulations promul8 gated under subsection (i). Such revised regulations need 

9 not meet the requirements identified in subsection (i) if 

10 the Administrator determines that an alternative auction 

11 design would be more effective, taking into account factors 

12 including costs of administration, transparency, fairness, 

13 and risks of collusion or manipulation. In determining 

14 whether and how to revise the initial regulations under 

15 this subsection, the Administrator shall not consider maxi16 mization of revenues to the Federal Government. 

17 ‘‘SEC. 727. PERMITS. 

18 ‘‘(a) PERMIT PROGRAM.—For stationary sources 

19 subject to title V of this Act that are covered entities, the 

20 provisions of this title shall be implemented by permits 

21 issued to such covered entities (and enforced) in accord22 ance with the provisions of title V, as modified by this 

23 title. Any such permit issued by the Administrator, or by 

24 a State or Indian tribe with an approved permit program, 

25 shall require the owner or operator of a covered entity to 


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1 hold allowances or offset credits at least equal to the total 

2 annual amount of carbon dioxide equivalents for its com3 bined emissions and attributable greenhouse gas emissions 

4 to which section 722 applies. No such permit shall be 

5 issued that is inconsistent with the requirements of this 

6 title, and title V as applicable. Nothing in this section re7 garding compliance plans or in title V shall be construed 

8 as affecting allowances or offset credits. Submission of a 

9 statement by the owner or operator, or the designated rep10 resentative of the owners and operators, of a covered enti11 ty that the owners and operators will hold allowances or 

12 offset credits for the entity’s combined emissions and at13 tributable greenhouse gas emissions to which section 722 

14 applies shall be deemed to meet the proposed and ap15 proved planning requirements of title V. Recordation by 

16 the Administrator of transfers of allowances and offset 

17 credits shall amend automatically all applicable proposed 

18 or approved permit applications, compliance plans, and 

19 permits. 

20 ‘‘(b) MULTIPLE OWNERS.—No permit shall be issued 

21 under this section and no allowances or offset credits shall 

22 be disbursed under this title to a covered entity or any 

23 other person until the designated representative of the 

24 owners or operators has filed a certificate of representa25 tion with regard to matters under this title, including the 


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1 holding and distribution of emission allowances and the 

2 proceeds of transactions involving emission allowances. 

3 Where there are multiple holders of a legal or equitable 

4 title to, or a leasehold interest in, such a covered entity 

5 or other entity or where a utility or industrial customer 

6 purchases power under a long-term power purchase con7 tract from an independent power production facility that 

8 is a covered entity, the certificate shall state— 

9 ‘‘(1) that emission allowances and the proceeds 

10 of transactions involving emission allowances will be 

11 deemed to be held or distributed in proportion to 

12 each holder’s legal, equitable, leasehold, or contrac13 tual reservation or entitlement; or 

14 ‘‘(2) if such multiple holders have expressly pro15 vided for a different distribution of emission allow16 ances by contract, that emission allowances and the 

17 proceeds of transactions involving emission allow18 ances will be deemed to be held or distributed in ac19 cordance with the contract. 

20 A passive lessor, or a person who has an equitable interest 

21 through such lessor, whose rental payments are not based, 

22 either directly or indirectly, upon the revenues or income 

23 from the covered entity or other entity shall not be deemed 

24 to be a holder of a legal, equitable, leasehold, or contrac25 tual interest for the purpose of holding or distributing 


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1 emission allowances as provided in this subsection, during 

2 either the term of such leasehold or thereafter, unless ex3 pressly provided for in the leasehold agreement. Except 

4 as otherwise provided in this subsection, where all legal 

5 or equitable title to or interest in a covered entity, or other 

6 entity, is held by a single person, the certificate shall state 

7 that all emission allowances received by the entity are 

8 deemed to be held for that person. 

9 ‘‘(c) PROHIBITION.—It shall be unlawful for any per10 son to operate any stationary source subject to the re11 quirements of this section except in compliance with the 

12 terms and requirements of a permit issued by the Admin13 istrator or a State or Indian tribe with an approved permit 

14 program in accordance with this section. For purposes of 

15 this subsection, compliance, as provided in section 504(f), 

16 with a permit issued under title V which complies with 

17 this title for covered entities shall be deemed compliance 

18 with this subsection as well as section 502(a). 

19 ‘‘(d) RELIABILITY.—Nothing in this section or title 

20 V shall be construed as requiring termination of oper21 ations of a stationary source that is a covered entity for 

22 failure to have an approved permit, or compliance plan, 

23 that is consistent with the requirements in the second and 

24 fifth sentences of subsection (a) concerning the holding 

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1 ered entity may be subject to the applicable enforcement 

2 provision of section 113. 

3 ‘‘(e) REGULATIONS.—Not later than 2 years after the 

4 date of enactment of this title, the Administrator shall 

5 promulgate regulations to implement this section. To pro6 vide for permits required under this section, each State 

7 in which one or more stationary sources that are covered 

8 entities are located shall submit, in accordance with this 

9 section and title V, revised permit programs for approval. 

10 ‘‘SEC. 728. INTERNATIONAL EMISSION ALLOWANCES. 

11 ‘‘(a) QUALIFYING PROGRAMS.—The Administrator, 

12 in consultation with the Secretary of State, may by rule 

13 designate an international climate change program as a 

14 qualifying international program if— 

15 ‘‘(1) the program is run by a national or supra16 national foreign government, and imposes a manda17 tory absolute tonnage limit on greenhouse gas emis18 sions from 1 or more foreign countries, or from 1 or 

19 more economic sectors in such a country or coun20 tries; and 

21 ‘‘(2) the program is at least as stringent as the 

22 program established by this title, including provi23 sions to ensure at least comparable monitoring, com24 pliance, enforcement, quality of offsets, and restric25 tions on the use of offsets. 


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1 ‘‘(b) DISQUALIFIED ALLOWANCES.—An international 

2 emission allowance may not be held under section 

3 722(d)(2) if it is in the nature of an offset instrument 

4 or allowance awarded based on the achievement of green5 house gas emission reductions or avoidance, or greenhouse 

6 gas sequestration, that are not subject to the mandatory 

7 absolute tonnage limits referred to in subsection (a)(1). 

8 ‘‘(c) RETIREMENT.— 

9 ‘‘(1) ENTITY CERTIFICATION.—The owner or 

10 operator of an entity that holds an international 

11 emission allowance under section 722(d)(2) shall 

12 certify to the Administrator that such international 

13 emission allowance has not previously been used to 

14 comply with any foreign, international, or domestic 

15 greenhouse gas regulatory program. 

16 ‘‘(2) RETIREMENT.— 

17 ‘‘(A) FOREIGN AND INTERNATIONAL REG18 ULATORY ENTITIES.—The Administrator, in 

19 consultation with the Secretary of State, shall 

20 seek, by whatever means appropriate, including 

21 agreements and technical cooperation on allow22 ance tracking, to ensure that any relevant for23 eign, international, and domestic regulatory en24 tities— 


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1 ‘‘(i) are notified of the use, for pur2 poses of compliance with this title, of any 

3 international emission allowance; and 

4 ‘‘(ii) provide for the disqualification of 

5 such international emission allowance for 

6 any subsequent use under the relevant for7 eign, international, or domestic greenhouse 

8 gas regulatory program, regardless of 

9 whether such use is a sale, exchange, or 

10 submission to satisfy a compliance obliga11 tion. 

12 ‘‘(B) DISQUALIFICATION FROM FURTHER

13 USE.—The Administrator shall ensure that, 

14 once an international emission allowance has 

15 been disqualified or otherwise used for purposes 

16 of compliance with this title, such allowance 

17 shall be disqualified from any further use under 

18 this title. 

19 ‘‘(d) USE LIMITATIONS.—The Administrator may, by 

20 rule, apply a limit to the percentage of the combined 

21 greenhouse gas emissions and attributable greenhouse gas 

22 emissions of a covered entity with respect to which compli23 ance may be demonstrated by holding international emis24 sion allowances under section 722(d)(2), consistent with 

25 the purposes of the Safe Climate Act. 


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1 ‘‘PART D—OFFSETS 

2 ‘‘SEC. 731. OFFSETS INTEGRITY ADVISORY BOARD. 

3 ‘‘(a) ESTABLISHMENT.—Not later than 30 days after 

4 the date of enactment of this title, the Administrator shall 

5 establish an independent Offsets Integrity Advisory 

6 Board. The Advisory Board shall make recommendations 

7 to the Administrator for use in promulgating and revising 

8 regulations under this part and part E, and for ensuring 

9 the overall environmental integrity of the programs estab10 lished pursuant to those regulations. 

11 ‘‘(b) MEMBERSHIP.—The Advisory Board shall be 

12 comprised of at least nine members. Each member shall 

13 be qualified by education, training, and experience to 

14 evaluate scientific and technical information on matters 

15 referred to the Board under this section. The Adminis16 trator shall appoint Advisory Board members, including 

17 a chair and vice-chair of the Advisory Board. Terms shall 

18 be 3 years in length, except for initial terms, which may 

19 be up to 5 years in length to allow staggering. Members 

20 may be reappointed only once for an additional 3-year 

21 term, and such second term may follow directly after a 

22 first term. 

23 ‘‘(c) ACTIVITIES.—The Advisory Board established 

24 pursuant to subsection (a) shall— 

25 ‘‘(1) provide recommendations, not later than 

26 90 days after the Advisory Board’s establishment 


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1 and periodically thereafter, to the Administrator re2 garding offset project types that should be consid3 ered for eligibility under section 733, taking into 

4 consideration relevant scientific and other issues, in5 cluding— 

6 ‘‘(A) the availability of a representative 

7 data set for use in developing the activity base8 line; 

9 ‘‘(B) the potential for accurate quantifica10 tion of greenhouse gas reduction, avoidance, or 

11 sequestration for an offset project type; 

12 ‘‘(C) the potential level of scientific and 

13 measurement uncertainty associated with an 

14 offset project type; and 

15 ‘‘(D) any beneficial or adverse environ16 mental, public health, welfare, social, economic, 

17 or energy effects associated with an offset 

18 project type; 

19 ‘‘(2) make available to the Administrator its ad20 vice and comments on offset methodologies that 

21 should be considered under regulations promulgated 

22 with respect to section 734, including methodologies 

23 to address the issues of additionality, activity base24 lines, quantification methods, leakage, uncertainty, 

25 permanence, and environmental integrity; 


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1 ‘‘(3) make available to the Administrator, and 

2 other relevant Federal agencies, its advice and com3 ments regarding scientific, technical, and methodo4 logical issues specific to the issuance of international 

5 offset credits under section 743; 

6 ‘‘(4) make available to the Administrator, and 

7 other relevant Federal agencies, its advice and com8 ments regarding scientific, technical, and methodo9 logical issues associated with the implementation of 

10 part E; 

11 ‘‘(5) make available to the Administrator its ad12 vice and comments on areas in which further knowl13 edge is required to appraise the adequacy of exist14 ing, revised, or proposed methodologies for use 

15 under this part and part E, and describe the re16 search efforts necessary to provide the required in17 formation; and 

18 ‘‘(6) make available to the Administrator its ad19 vice and comments on other ways to improve or 

20 safeguard the environmental integrity of programs 

21 established under this part and part E. 

22 ‘‘(d) SCIENTIFIC REVIEW OF OFFSET AND DEFOR23 ESTATION REDUCTION PROGRAMS.—Not later than Janu24 ary 1, 2017, and at five-year intervals thereafter, the Ad25 visory Board shall submit to the Administrator and make 


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1 available to the public an analysis of relevant scientific and 

2 technical information related to this part and part E. The 

3 Advisory Board shall review approved and potential meth4 odologies, scientific studies, offset project monitoring, off5 set project verification reports, and audits related to this 

6 part and part E, and evaluate the net emissions effects 

7 of implemented offset projects. The Advisory Board shall 

8 recommend changes to offset methodologies, protocols, or 

9 project types, or to the overall offset program under this 

10 part, to ensure that offset credits issued by the Adminis11 trator do not compromise the integrity of the annual emis12 sion reductions established under section 703, and to 

13 avoid or minimize adverse effects to human health or the 

14 environment. 

15 ‘‘SEC. 732. ESTABLISHMENT OF OFFSETS PROGRAM. 

16 ‘‘(a) REGULATIONS.—Not later than 2 years after 

17 the date of enactment of this title, the Administrator, in 

18 consultation with appropriate Federal agencies and taking 

19 into consideration the recommendations of the Advisory 

20 Board, shall promulgate regulations establishing a pro21 gram for the issuance of offset credits in accordance with 

22 the requirements of this part. The Administrator shall pe23 riodically revise these regulations as necessary to meet the 

24 requirements of this part. 


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1 ‘‘(b) REQUIREMENTS.—The regulations described in 

2 subsection (a) shall— 

3 ‘‘(1) authorize the issuance of offset credits 

4 with respect to qualifying offset projects that result 

5 in reductions or avoidance of greenhouse gas emis6 sions, or sequestration of greenhouse gases; 

7 ‘‘(2) ensure that such offset credits represent 

8 verifiable and additional greenhouse gas emission re9 ductions or avoidance, or increases in sequestration; 

10 ‘‘(3) ensure that offset credits issued for se11 questration offset projects are only issued for green12 house gas reductions that are permanent; 

13 ‘‘(4) provide for the implementation of the re14 quirements of this part; and 

15 ‘‘(5) include as reductions in greenhouse gases 

16 reductions achieved through the destruction of meth17 ane and its conversion to carbon dioxide, and reduc18 tions achieved through destruction of 

19 chlorofluorocarbons or other ozone depleting sub20 stances, if permitted by the Administrator under 

21 section 619(b)(9) and subject to the conditions spec22 ified in section 619(b)(9), based on the carbon diox23 ide equivalent value of the substance destroyed. 

24 ‘‘(c) COORDINATION TO MINIMIZE NEGATIVE EF25 FECTS.—In promulgating and implementing regulations 


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1 under this part, the Administrator shall act (including by 

2 rejecting projects, if necessary) to avoid or minimize, to 

3 the maximum extent practicable, adverse effects on human 

4 health or the environment resulting from the implementa5 tion of offset projects under this part. 

6 ‘‘(d) OFFSET REGISTRY.—The Administrator shall 

7 establish within the allowance tracking system established 

8 under section 724(d) an Offset Registry for qualifying off9 set projects and offset credits issued with respect thereto 

10 under this part. 

11 ‘‘(e) LEGAL STATUS OF OFFSET CREDIT.—An offset 

12 credit does not constitute a property right. 

13 ‘‘(f) FEES.—The Administrator shall assess fees pay14 able by offset project developers in an amount necessary 

15 to cover the administrative costs to the Environmental 

16 Protection Agency of carrying out the activities under this 

17 part. Amounts collected for such fees shall be available 

18 to the Administrator for carrying out the activities under 

19 this part to the extent provided in advance in appropria20 tions Acts. 

21 ‘‘SEC. 733. ELIGIBLE PROJECT TYPES. 

22 ‘‘(a) LIST OF ELIGIBLE PROJECT TYPES.— 

23 ‘‘(1) IN GENERAL.—As part of the regulations 

24 promulgated under section 732(a), the Adminis25 trator shall establish, and may periodically revise, a 


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1 list of types of projects eligible to generate offset 

2 credits, including international offset credits, under 

3 this part. 

4 ‘‘(2) ADVISORY BOARD RECOMMENDATIONS.— 

5 In determining the eligibility of project types, the 

6 Administrator shall take into consideration the rec7 ommendations of the Advisory Board. If a list estab8 lished under this section differs from the rec9 ommendations of the Advisory Board, the regula10 tions promulgated under section 732(a) shall include 

11 a justification for the discrepancy. 

12 ‘‘(3) INITIAL DETERMINATION.—The Adminis13 trator shall establish the initial eligibility list under 

14 paragraph (1) not later than one year after the date 

15 of enactment of this title. The Administrator shall 

16 add additional project types to the list not later than 

17 2 years after the date of enactment of this title. In 

18 determining the initial list, the Administrator shall 

19 give priority to consideration of offset project types 

20 that are recommended by the Advisory Board and 

21 for which there are well developed methodologies 

22 that the Administrator determines would meet the 

23 criteria of section 734, with such modifications as 

24 the Administrator deems appropriate. In establishing 

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1 trator shall give priority to methodologies for offset 

2 project types included on the initial eligibility list. 

3 ‘‘(b) MODIFICATION OF LIST.—The Administrator— 

4 ‘‘(1) may at any time, by rule, add a project 

5 type to the list established under subsection (a) if 

6 the Administrator, in consultation with appropriate 

7 Federal agencies and taking into consideration the 

8 recommendations of the Advisory Board, determines 

9 that the project type can generate additional reduc10 tions or avoidance of greenhouse gas emissions, or 

11 sequestration of greenhouse gases, subject to the re12 quirements of this part; 

13 ‘‘(2) may at any time, by rule, determine that 

14 a project type on the list does not meet the require15 ments of this part, and remove the project type from 

16 the list established under subsection (a), in consulta17 tion with appropriate Federal agencies and taking 

18 into consideration any recommendations of the Advi19 sory Board; and 

20 ‘‘(3) shall consider adding to or removing from 

21 the list established under subsection (a), at a min22 imum, project types proposed to the Adminis23 trator— 

24 ‘‘(A) by petition pursuant to subsection 

25 (c); or 


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1 ‘‘(B) by the Advisory Board. 

2 ‘‘(c) PETITION PROCESS.—Any person may petition 

3 the Administrator to modify the list established under sub4 section (a) by adding or removing a project type pursuant 

5 to subsection (b). Any such petition shall include a show6 ing by the petitioner that there is adequate data to estab7 lish that the project type does or does not meet the re8 quirements of this part. Not later than 12 months after 

9 receipt of such a petition, the Administrator shall either 

10 grant or deny the petition and publish a written expla11 nation of the reasons for the Administrator’s decision. The 

12 Administrator may not deny a petition under this sub13 section on the basis of inadequate Environmental Protec14 tion Agency resources or time for review. 

15 ‘‘SEC. 734. REQUIREMENTS FOR OFFSET PROJECTS. 

16 ‘‘(a) METHODOLOGIES.—As part of the regulations 

17 promulgated under section 732(a), the Administrator shall 

18 establish, for each type of offset project listed as eligible 

19 under section 733, the following: 

20 ‘‘(1) ADDITIONALITY.—A standardized method21 ology for determining the additionality of greenhouse 

22 gas emission reductions or avoidance, or greenhouse 

23 gas sequestration, achieved by an offset project of 

24 that type. Such methodology shall ensure, at a min25 imum, that any greenhouse gas emission reduction 


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1 or avoidance, or any greenhouse gas sequestration, is 

2 considered additional only to the extent that it re3 sults from activities that— 

4 ‘‘(A) are not required by or undertaken to 

5 comply with any law, including any regulation 

6 or consent order; 

7 ‘‘(B) were not commenced prior to Janu8 ary 1, 2009, except in the case of— 

9 ‘‘(i) offset project activities that com10 menced after January 1, 2001, and were 

11 registered as of the date of enactment of 

12 this title under an offset program with re13 spect to which the Administrator has made 

14 an affirmative determination under section 

15 740(a)(2); or 

16 ‘‘(ii) activities that are readily revers17 ible, with respect to which the Adminis18 trator may set an alternative earlier date 

19 under this subparagraph that is not earlier 

20 than January 1, 2001, where the Adminis21 trator determines that setting such an al22 ternative date may produce an environ23 mental benefit by removing an incentive to 

24 cease and then reinitiate activities that 

25 began prior to January 1, 2009; and 


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1 ‘‘(C) exceed the activity baseline estab2 lished under paragraph (2). 

3 ‘‘(2) ACTIVITY BASELINES.—A standardized 

4 methodology for establishing activity baselines for 

5 offset projects of that type. The Administrator shall 

6 set activity baselines to reflect a conservative esti7 mate of business-as-usual performance or practices 

8 for the relevant type of activity such that the base9 line provides an adequate margin of safety to ensure 

10 the environmental integrity of offsets calculated in 

11 reference to such baseline. 

12 ‘‘(3) QUANTIFICATION METHODS.—A standard13 ized methodology for determining the extent to 

14 which greenhouse gas emission reductions or avoid15 ance, or greenhouse gas sequestration, achieved by 

16 an offset project of that type exceed a relevant activ17 ity baseline, including protocols for monitoring and 

18 accounting for uncertainty. 

19 ‘‘(4) LEAKAGE.—A standardized methodology 

20 for accounting for and mitigating potential leakage, 

21 if any, from an offset project of that type, taking 

22 uncertainty into account. 

23 ‘‘(b) ACCOUNTING FOR REVERSALS.— 

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1 trator shall establish requirements to account for 

2 and address reversals, including— 

3 ‘‘(A) a requirement to report any reversal 

4 with respect to an offset project for which offset 

5 credits have been issued under this part; 

6 ‘‘(B) provisions to require emission allow7 ances to be held in amounts to fully compensate 

8 for greenhouse gas emissions attributable to re9 versals, and to assign responsibility for holding 

10 such emission allowances; and 

11 ‘‘(C) any other provisions the Adminis12 trator determines necessary to account for and 

13 address reversals. 

14 ‘‘(2) MECHANISMS.—The Administrator shall 

15 prescribe mechanisms to ensure that any sequestra16 tion with respect to which an offset credit is issued 

17 under this part results in a permanent net increase 

18 in sequestration, and that full account is taken of 

19 any actual or potential reversal of such sequestra20 tion, with an adequate margin of safety. The Admin21 istrator shall prescribe at least one of the following 

22 mechanisms to meet the requirements of this para23 graph: 

24 ‘‘(A) An offsets reserve, pursuant to para25 graph (3). 


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1 ‘‘(B) Insurance that provides for purchase 

2 and provision to the Administrator for retire3 ment of an amount of offset credits or emission 

4 allowances equal in number to the tons of car5 bon dioxide equivalents of greenhouse gas emis6 sions released due to reversal. 

7 ‘‘(C) Another mechanism that the Admin8 istrator determines satisfies the requirements of 

9 this part. 

10 ‘‘(3) OFFSETS RESERVE.— 

11 ‘‘(A) IN GENERAL.—An offsets reserve re12 ferred to in paragraph (2)(A) is a program 

13 under which, before issuance of offset credits 

14 under this part, the Administrator shall sub15 tract and reserve from the quantity to be issued 

16 a quantity of offset credits based on the risk of 

17 reversal. The Administrator shall— 

18 ‘‘(i) hold these reserved offset credits 

19 in the offsets reserve; and 

20 ‘‘(ii) register the holding of the re21 served offset credits in the Offset Registry 

22 established under section 732(d). 

23 ‘‘(B) PROJECT REVERSAL.— 

24 ‘‘(i) IN GENERAL.—If a reversal has 

25 occurred with respect to an offset project 


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1 for which offset credits are reserved under 

2 this paragraph, the Administrator shall re3 tire offset credits or emission allowances 

4 from the offsets reserve to fully account 

5 for the tons of carbon dioxide equivalent 

6 that are no longer sequestered. 

7 ‘‘(ii) INTENTIONAL REVERSALS.—If 

8 the Administrator determines that a rever9 sal was intentional, the offset project devel10 oper for the relevant offset project shall 

11 place into the offsets reserve a quantity of 

12 offset credits, or combination of offset 

13 credits and emission allowances, equal in 

14 number to the number of reserve offset 

15 credits that were canceled due to the rever16 sal pursuant to clause (i). 

17 ‘‘(iii) UNINTENTIONAL REVERSALS.— 

18 If the Administrator determines that a re19 versal was unintentional, the offset project 

20 developer for the relevant offset project 

21 shall place into the offsets reserve a quan22 tity of offset credits, or combination of off23 set credits and emission allowances, equal 

24 in number to half the number of offset 

25 credits that were reserved for that offset 


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1 project, or half the number of reserve off2 set credits that were canceled due to the 

3 reversal pursuant to clause (i), whichever 

4 is less. 

5 ‘‘(C) USE OF RESERVED OFFSET CRED6 ITS.—Offset credits placed into the offsets re7 serve under this paragraph may not be used to 

8 comply with section 722. 

9 ‘‘(c) CREDITING PERIODS.— 

10 ‘‘(1) IN GENERAL.—For each offset project 

11 type, the Administrator shall specify a crediting pe12 riod, and establish provisions for petitions for new 

13 crediting periods, in accordance with this subsection. 

14 ‘‘(2) DURATION.—The crediting period shall be 

15 no less than 5 and no greater than 10 years for any 

16 project type other than those involving sequestra17 tion. 

18 ‘‘(3) ELIGIBILITY.—An offset project shall be 

19 eligible to generate offset credits under this part 

20 only during the project’s crediting period. During 

21 such crediting period, the project shall remain eligi22 ble to generate offset credits, subject to the meth23 odologies and project type eligibility list that applied 

24 as of the date of project approval under section 735, 


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1 except as provided in paragraph (4) of this sub2 section. 

3 ‘‘(4) PETITION FOR NEW CREDITING PERIOD.— 

4 An offset project developer may petition for a new 

5 crediting period to commence after termination of a 

6 crediting period, subject to the methodologies and 

7 project type eligibility list in effect at the time when 

8 such petition is submitted. A petition may not be 

9 submitted under this paragraph more than 18 

10 months before the end of the pending crediting pe11 riod. The Administrator may limit the number of 

12 new crediting periods available for projects of par13 ticular project types. 

14 ‘‘(d) ENVIRONMENTAL INTEGRITY.—In establishing 

15 the requirements under this section, the Administrator 

16 shall apply conservative assumptions or methods to maxi17 mize the certainty that the environmental integrity of the 

18 cap established under section 703 is not compromised. 

19 ‘‘(e) PRE-EXISTING METHODOLOGIES.—In promul20 gating requirements under this section, the Administrator 

21 shall give due consideration to methodologies for offset 

22 projects existing as of the date of enactment of this title. 

23 ‘‘(f) ADDED PROJECT TYPES.—The Administrator 

24 shall establish methodologies described in subsection (a), 

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1 versals as described in subsection (b), for any project type 

2 that is added to the list pursuant to section 733. 

3 ‘‘SEC. 735. APPROVAL OF OFFSET PROJECTS. 

4 ‘‘(a) APPROVAL PETITION.—An offset project devel5 oper shall submit an offset project approval petition pro6 viding such information as the Administrator requires to 

7 determine whether the offset project is eligible for issuance 

8 of offset credits under rules promulgated pursuant to this 

9 part. 

10 ‘‘(b) TIMING.—An approval petition shall be sub11 mitted to the Administrator under subsection (a) no later 

12 than the time at which an offset project’s first verification 

13 report is submitted under section 736. 

14 ‘‘(c) APPROVAL PETITION REQUIREMENTS.—As part 

15 of the regulations promulgated under section 732, the Ad16 ministrator shall include provisions for, and shall specify, 

17 the required components of an offset project approval peti18 tion required under subsection (a), which shall include— 

19 ‘‘(1) designation of an offset project developer; 

20 and 

21 ‘‘(2) any other information that the Adminis22 trator considers to be necessary to achieve the pur23 poses of this part. 

24 ‘‘(d) APPROVAL AND NOTIFICATION.—Not later than 

25 90 days after receiving a complete approval petition under 


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1 subsection (a), the Administrator shall make the approval 

2 petition publicly available, approve or deny the petition in 

3 writing and if the petition is denied, provide the reasons 

4 for denial, and make the Administrator’s written decision 

5 publicly available. After an offset project is approved, the 

6 offset project developer shall not be required to resubmit 

7 an approval petition during the offset project’s crediting 

8 period, except as provided in section 734(c)(4). 

9 ‘‘(e) APPEAL.—The Administrator shall establish 

10 procedures for appeal and review of determinations made 

11 under subsection (d). 

12 ‘‘(f) VOLUNTARY PREAPPROVAL REVIEW.—The Ad13 ministrator may establish a voluntary preapproval review 

14 procedure, to allow an offset project developer to request 

15 the Administrator to conduct a preliminary eligibility re16 view for an offset project. Findings of such reviews shall 

17 not be binding upon the Administrator. The voluntary 

18 preapproval review procedure— 

19 ‘‘(1) shall require the offset project developer to 

20 submit such basic project information as the Admin21 istrator requires to provide a meaningful review; and 

22 ‘‘(2) shall require a response from the Adminis23 trator not later than 6 weeks after receiving a re24 quest for review under this subsection. 


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1 ‘‘SEC. 736. VERIFICATION OF OFFSET PROJECTS. 

2 ‘‘(a) IN GENERAL.—As part of the regulations pro3 mulgated under section 732(a), the Administrator shall es4 tablish requirements, including protocols, for verification 

5 of the quantity of greenhouse gas emission reductions or 

6 avoidance, or sequestration of greenhouse gases, resulting 

7 from an offset project. The regulations shall require that 

8 an offset project developer shall submit a report, prepared 

9 by a third-party verifier accredited under subsection (d), 

10 providing such information as the Administrator requires 

11 to determine the quantity of greenhouse gas emission re12 ductions or avoidance, or sequestration of greenhouse 

13 gases, resulting from the offset project. 

14 ‘‘(b) SCHEDULE.—The Administrator shall prescribe 

15 a schedule for the submission of verification reports under 

16 subsection (a). 

17 ‘‘(c) VERIFICATION REPORT REQUIREMENTS.—The 

18 Administrator shall specify the required components of a 

19 verification report required under subsection (a), which 

20 shall include— 

21 ‘‘(1) the name and contact information for a 

22 designated representative for the offset project devel23 oper; 

24 ‘‘(2) the quantity of greenhouse gases reduced, 

25 avoided, or sequestered; 


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1 ‘‘(3) the methodologies applicable to the project 

2 pursuant to section 734; 

3 ‘‘(4) a certification that the project meets the 

4 applicable requirements; 

5 ‘‘(5) a certification establishing that the conflict 

6 of interest requirements in the regulations promul7 gated under subsection (d)(1) have been complied 

8 with; and 

9 ‘‘(6) any other information that the Adminis10 trator considers to be necessary to achieve the pur11 poses of this part. 

12 ‘‘(d) VERIFIER ACCREDITATION.— 

13 ‘‘(1) IN GENERAL.—As part of the regulations 

14 promulgated under section 732(a), the Adminis15 trator shall establish a process and requirements for 

16 periodic accreditation of third-party verifiers to en17 sure that such verifiers are professionally qualified 

18 and have no conflicts of interest. 

19 ‘‘(2) STANDARDS.— 

20 ‘‘(A) AMERICAN NATIONAL STANDARDS IN21 STITUTE ACCREDITATION.—The Administrator 

22 may accredit, or accept for purposes of accredi23 tation under this subsection, verifiers accredited 

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1 ance with ISO 14065. The Administrator shall 

2 accredit, or accept for accreditation, verifiers 

3 under this subparagraph only if the Adminis4 trator finds that the American National Stand5 ards Institute accreditation program provides 

6 sufficient assurance that the requirements of 

7 this part will be met. 

8 ‘‘(B) EPA ACCREDITATION.—As part of 

9 the regulations promulgated under section 

10 732(a), the Administrator may establish accred11 itation standards for verifiers under this sub12 section, and may establish related training and 

13 testing programs and requirements. 

14 ‘‘(3) PUBLIC ACCESSIBILITY.—Each verifier 

15 meeting the requirements for accreditation in ac16 cordance with this subsection shall be listed in a 

17 publicly accessible database, which shall be main18 tained and updated by the Administrator. 

19 ‘‘SEC. 737. ISSUANCE OF OFFSET CREDITS. 

20 ‘‘(a) DETERMINATION AND NOTIFICATION.—Not 

21 later than 90 days after receiving a complete verification 

22 report under section 736, the Administrator shall— 

23 ‘‘(1) make the report publicly available; 

24 ‘‘(2) make a determination of the quantity of 

25 greenhouse gas emissions that have been reduced or 


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1 avoided, or greenhouse gases that have been seques2 tered, by the offset project; and 

3 ‘‘(3) notify the offset project developer in writ4 ing of such determination and make such determina5 tion publicly available. 

6 ‘‘(b) ISSUANCE OF OFFSET CREDITS.—The Adminis7 trator shall issue one offset credit to an offset project de8 veloper for each ton of carbon dioxide equivalent that the 

9 Administrator has determined has been reduced, avoided, 

10 or sequestered during the period covered by a verification 

11 report submitted in accordance with section 736, only if— 

12 ‘‘(1) the Administrator has approved the offset 

13 project pursuant to section 735; and 

14 ‘‘(2) the relevant emissions reduction, avoid15 ance, or sequestration has— 

16 ‘‘(A) already occurred, during the offset 

17 project’s crediting period; and 

18 ‘‘(B) occurred after January 1, 2009. 

19 ‘‘(c) APPEAL.—The Administrator shall establish 

20 procedures for appeal and review of determinations made 

21 under subsection (a). 

22 ‘‘(d) TIMING.—Offset credits meeting the criteria es23 tablished in subsection (b) shall be issued not later than 

24 2 weeks following the verification determination made by 

25 the Administrator under subsection (a). 


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1 ‘‘(e) REGISTRATION.—The Administrator shall as2 sign a unique serial number to and register each offset 

3 credit to be issued in the Offset Registry established under 

4 section 732(d). 

5 ‘‘SEC. 738. AUDITS. 

6 ‘‘(a) IN GENERAL.—The Administrator shall, on an 

7 ongoing basis, conduct random audits of offset projects, 

8 offset credits, and practices of third-party verifiers. In 

9 each year, the Administrator shall conduct audits, at min10 imum, for a representative sample of project types and 

11 geographic areas. 

12 ‘‘(b) DELEGATION.—The Administrator may delegate 

13 to a State or tribal government the responsibility for con14 ducting audits under this section if the Administrator 

15 finds that the program proposed by the State or tribal 

16 government provides assurances equivalent to those pro17 vided by the auditing program of the Administrator, and 

18 that the integrity of the offset program under this part 

19 will be maintained. Nothing in this subsection shall pre20 vent the Administrator from conducting any audit the Ad21 ministrator considers necessary and appropriate. 

22 ‘‘SEC. 739. PROGRAM REVIEW AND REVISION. 

23 ‘‘At least once every 5 years, the Administrator shall 

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1 ing into consideration the recommendations of the Advi2 sory Board, update and revise— 

3 ‘‘(1) the list of eligible project types established 

4 under section 733; 

5 ‘‘(2) the methodologies established, including 

6 specific activity baselines, under section 734(a); 

7 ‘‘(3) the reversal requirements and mechanisms 

8 established or prescribed under section 734(b); 

9 ‘‘(4) measures to improve the accountability of 

10 the offsets program; and 

11 ‘‘(5) any other requirements established under 

12 this part to ensure the environmental integrity and 

13 effective operation of this part. 

14 ‘‘SEC. 740. EARLY OFFSET SUPPLY. 

15 ‘‘(a) PROJECTS REGISTERED UNDER OTHER GOV16 ERNMENT-RECOGNIZED PROGRAMS.—Except as provided 

17 in subsection (b) or (c), the Administrator shall issue one 

18 offset credit for each ton of carbon dioxide equivalent 

19 emissions reduced, avoided, or sequestered— 

20 ‘‘(1) under an offset project that was started 

21 after January 1, 2001; 

22 ‘‘(2) for which a credit was issued under any 

23 regulatory or voluntary greenhouse gas emission off24 set program that the Administrator determines— 


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1 ‘‘(A) was established under State or tribal 

2 law or regulation prior to January 1, 2009, or 

3 has been approved by the Administrator pursu4 ant to subsection (e); 

5 ‘‘(B) has developed offset project type 

6 standards, methodologies, and protocols 

7 through a public consultation process or a peer 

8 review process; 

9 ‘‘(C) has made available to the public 

10 standards, methodologies, and protocols that re11 quire that credited emission reductions, avoid12 ance, or sequestration are permanent, addi13 tional, verifiable, and enforceable; 

14 ‘‘(D) requires that all emission reductions, 

15 avoidance, or sequestration be verified by a 

16 State or tribal regulatory agency or an accred17 ited third-party independent verification body; 

18 ‘‘(E) requires that all credits issued are 

19 registered in a publicly accessible registry, with 

20 individual serial numbers assigned for each ton 

21 of carbon dioxide equivalent emission reduc22 tions, avoidance, or sequestration; and 

23 ‘‘(F) ensures that no credits are issued for 

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1 ative, has funded, solicited, or served as a fund 

2 administrator for the development of the activ3 ity; and 

4 ‘‘(3) for which the credit described in para5 graph (2) is transferred to the Administrator. 

6 ‘‘(b) INELIGIBLE CREDITS.—Subsection (a) shall not 

7 apply to offset credits that have expired or have been re8 tired, canceled, or used for compliance under a program 

9 established under State or tribal law or regulation. 

10 ‘‘(c) LIMITATION.—Notwithstanding subsection 

11 (a)(1), offset credits shall be issued under this section— 

12 ‘‘(1) only for reductions or avoidance of green13 house gas emissions, sequestration of greenhouse 

14 gases, or destruction of chlorofluorocarbons (subject 

15 to the conditions specified in section 619(b)(9) and 

16 based on the carbon dioxide equivalent value of the 

17 substance destroyed), that occur after January 1, 

18 2009; and 

19 ‘‘(2) only until the date that is 3 years after the 

20 date of enactment of this title, or the date that regu21 lations promulgated under section 732(a) take ef22 fect, whichever occurs sooner. 

23 ‘‘(d) RETIREMENT OF CREDITS.—The Administrator 

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1 section (a)(2) are retired for purposes of use under a pro2 gram described in subsection (b). 

3 ‘‘(e) OTHER PROGRAMS.—(1) Offset programs that 

4 either— 

5 ‘‘(A) were not established under State or tribal 

6 law or regulation; or 

7 ‘‘(B) were not established prior to January 1, 

8 2009, 

9 but that otherwise meet all of the criteria of subsection 

10 (a)(2) may apply to the Administrator to be approved 

11 under this subsection as an eligible program for early off12 set credits under this section. 

13 ‘‘(2) The Administrator shall approve any such pro14 gram that the Administrator determines has criteria and 

15 methodologies of at least equal stringency to the criteria 

16 and methodologies of the programs established under 

17 State or tribal law or regulation that the Administrator 

18 determines meet the criteria of subsection (a)(2). The Ad19 ministrator may approve types of offsets under any such 

20 program that are subject to criteria and methodologies of 

21 at least equal stringency to the criteria and methodologies 

22 for such types of offsets applied under the programs estab23 lished under State or tribal law or regulation that the Ad24 ministrator determines meet the criteria of subsection 

25 (a)(2). The Administrator shall make a determination on 


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1 any application received under this section by no later 

2 than 180 days from the date of receipt of the application. 

3 ‘‘SEC. 741. ENVIRONMENTAL CONSIDERATIONS. 

4 ‘‘If the Administrator lists forestry or other relevant 

5 land management-related offset projects as eligible offset 

6 project types under section 733, the Administrator, in con7 sultation with appropriate Federal agencies, shall promul8 gate regulations for the selection and use of species in 

9 such offset projects— 

10 ‘‘(1) to ensure that native species are given pri11 mary consideration in such projects; 

12 ‘‘(2) to enhance biological diversity in such 

13 projects; 

14 ‘‘(3) to prohibit the use of federally designated 

15 or State-designated noxious weeds; 

16 ‘‘(4) to prohibit the use of a species listed by 

17 a regional or State invasive plant authority within 

18 the applicable region or State; and 

19 ‘‘(5) in the case of forestry offset projects, in 

20 accordance with widely accepted, environmentally 

21 sustainable forestry practices. 

22 ‘‘SEC. 742. TRADING. 

23 ‘‘Section 724 shall apply to the trading of offset cred24 its. 


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1 ‘‘SEC. 743. INTERNATIONAL OFFSET CREDITS. 

2 ‘‘(a) IN GENERAL.—The Administrator, in consulta3 tion with the Secretary of State and the Administrator 

4 of the United States Agency for International Develop5 ment, may issue, in accordance with this section, inter6 national offset credits based on activities that reduce or 

7 avoid greenhouse gas emissions, or increase sequestration 

8 of greenhouse gases, in a developing country. Such credits 

9 may be issued for projects eligible under section 733 or 

10 as provided in subsection (c), (d), or (e) of this section. 

11 ‘‘(b) ISSUANCE.— 

12 ‘‘(1) REGULATIONS.—Not later than 2 years 

13 after the date of enactment of this title, the Admin14 istrator, in consultation with the Secretary of State, 

15 the Administrator of the United States Agency for 

16 International Development, and any other appro17 priate Federal agency, and taking into consideration 

18 the recommendations of the Advisory Board, shall 

19 promulgate regulations for implementing this sec20 tion. Except as otherwise provided in this section, 

21 the issuance of international offset credits under this 

22 section shall be subject to the requirements of this 

23 part. 

24 ‘‘(2) REQUIREMENTS FOR INTERNATIONAL

25 OFFSET CREDITS.—The Administrator may issue 

26 international offset credits only if— 


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1 ‘‘(A) the United States is a party to a bi2 lateral or multilateral agreement or arrange3 ment that includes the country in which the 

4 project or measure achieving the relevant green5 house gas emission reduction or avoidance, or 

6 greenhouse gas sequestration, has occurred; 

7 ‘‘(B) such country is a developing country; 

8 and 

9 ‘‘(C) such agreement or arrangement— 

10 ‘‘(i) ensures that the requirements of 

11 this part apply to the issuance of inter12 national offset credits under this section; 

13 and 

14 ‘‘(ii) provides for the appropriate dis15 tribution of international offset credits 

16 issued. 

17 ‘‘(c) SECTOR-BASED CREDITS.— 

18 ‘‘(1) IN GENERAL.—In order to minimize the 

19 potential for leakage and to encourage countries to 

20 take nationally appropriate mitigation actions to re21 duce or avoid greenhouse gas emissions, or sequester 

22 greenhouse gases, the Administrator, in consultation 

23 with the Secretary of State and the Administrator of 

24 the United States Agency for International Develop25 ment, shall— 


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1 ‘‘(A) identify sectors of specific countries 

2 with respect to which the issuance of inter3 national offset credits on a sectoral basis is ap4 propriate; and 

5 ‘‘(B) issue international offset credits for 

6 such sectors only on a sectoral basis. 

7 ‘‘(2) IDENTIFICATION OF SECTORS.— 

8 ‘‘(A) GENERAL RULE.—For purposes of 

9 paragraph (1)(A), a sectoral basis shall be ap10 propriate for activities— 

11 ‘‘(i) in countries that have compara12 tively high greenhouse gas emissions, or 

13 comparatively greater levels of economic 

14 development; and 

15 ‘‘(ii) that, if located in the United 

16 States, would be within a sector subject to 

17 the compliance obligation under section 

18 722. 

19 ‘‘(B) FACTORS.—In determining the sec20 tors and countries for which international offset 

21 credits should be awarded only on a sectoral 

22 basis, the Administrator, in consultation with 

23 the Secretary of State and the Administrator of 

24 the United States Agency for International De25 velopment, shall consider the following factors: 


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1 ‘‘(i) The country’s gross domestic 

2 product. 

3 ‘‘(ii) The country’s total greenhouse 

4 gas emissions. 

5 ‘‘(iii) Whether the comparable sector 

6 of the United States economy is covered by 

7 the compliance obligation under section 

8 722. 

9 ‘‘(iv) The heterogeneity or homo10 geneity of sources within the relevant sec11 tor. 

12 ‘‘(v) Whether the relevant sector pro13 vides products or services that are sold in 

14 internationally competitive markets. 

15 ‘‘(vi) The risk of leakage if inter16 national offset credits were issued on a 

17 project-level basis, instead of on a sectoral 

18 basis, for activities within the relevant sec19 tor. 

20 ‘‘(vii) The capability of accurately 

21 measuring, monitoring, reporting, and 

22 verifying the performance of sources across 

23 the relevant sector. 

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1 retary of State and the Administrator of 

2 the United States Agency for International 

3 Development, determines are appropriate 

4 to— 

5 ‘‘(I) ensure the integrity of the 

6 United States greenhouse gas emis7 sions cap established under section 

8 703; and 

9 ‘‘(II) encourage countries to take 

10 nationally appropriate mitigation ac11 tions to reduce or avoid greenhouse 

12 gas emissions, or sequester green13 house gases. 

14 ‘‘(3) SECTORAL BASIS.— 

15 ‘‘(A) DEFINITION.—In this subsection, the 

16 term ‘sectoral basis’ means the issuance of 

17 international offset credits only for the quantity 

18 of sector-wide reductions or avoidance of green19 house gas emissions, or sector-wide increases in 

20 sequestration of greenhouse gases, achieved 

21 across the relevant sector of the economy rel22 ative to a domestically enforceable baseline level 

23 of absolute emissions established in an agree24 ment or arrangement described in subsection 

25 (b)(2)(A) for the sector. 


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1 ‘‘(B) BASELINE.—The baseline for a sec2 tor shall be established on an absolute basis 

3 and at levels of greenhouse gas emissions con4 sistent with the thresholds identified in section 

5 705(e)(2) and lower than would occur under a 

6 business-as-usual scenario taking into account 

7 relevant domestic or international policies or in8 centives to reduce greenhouse gas emissions, 

9 among other factors, and additionality and per10 formance shall be determined on the basis of 

11 such baseline. 

12 ‘‘(d) CREDITS ISSUED BY AN INTERNATIONAL

13 BODY.— 

14 ‘‘(1) IN GENERAL.—The Administrator, in con15 sultation with the Secretary of State, may issue 

16 international offset credits in exchange for instru17 ments in the nature of offset credits that are issued 

18 by an international body established pursuant to the 

19 United Nations Framework Convention on Climate 

20 Change, to a protocol to such Convention, or to a 

21 treaty that succeeds such Convention. The Adminis22 trator may issue international offset credits under 

23 this subsection only if, in addition to the require24 ments of subsection (b), the Administrator has de25 termined that the international body that issued the 


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1 instruments has implemented substantive and proce2 dural requirements for the relevant project type that 

3 provide equal or greater assurance of the integrity of 

4 such instruments as is provided by the requirements 

5 of this part. Starting January 1, 2016, the Adminis6 trator shall issue no offset credit pursuant to this 

7 subsection if the activity generating the greenhouse 

8 gas emissions reductions or avoidance, or greenhouse 

9 gas sequestration, occurs in a country and sector 

10 identified by the Administrator under subsection (c). 

11 ‘‘(2) RETIREMENT.—The Administrator, in 

12 consultation with the Secretary of State, shall seek, 

13 by whatever means appropriate, including agree14 ments, arrangements, or technical cooperation with 

15 the international issuing body described in para16 graph (1), to ensure that such body— 

17 ‘‘(A) is notified of the Administrator’s 

18 issuance, under this subsection, of an inter19 national offset credit in exchange for an instru20 ment issued by such international body; and 

21 ‘‘(B) provides, to the extent feasible, for 

22 the disqualification of the instrument issued by 

23 such international body for subsequent use 

24 under any relevant foreign or international 

25 greenhouse gas regulatory program, regardless 


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1 of whether such use is a sale, exchange, or sub2 mission to satisfy a compliance obligation. 

3 ‘‘(e) OFFSETS FROM REDUCED DEFORESTATION.— 

4 ‘‘(1) REQUIREMENTS.—The Administrator, in 

5 accordance with the regulations promulgated under 

6 subsection (b)(1) and an agreement or arrangement 

7 described in subsection (b)(2)(A), shall issue inter8 national offset credits for greenhouse gas emission 

9 reductions achieved through activities to reduce de10 forestation only if, in addition to the requirements of 

11 subsection (b)— 

12 ‘‘(A) the activity occurs in— 

13 ‘‘(i) a country listed by the Adminis14 trator pursuant to paragraph (2); 

15 ‘‘(ii) a state or province listed by the 

16 Administrator pursuant to paragraph (5); 

17 or 

18 ‘‘(iii) a country listed by the Adminis19 trator pursuant to paragraph (6); 

20 ‘‘(B) except as provided in paragraph (5) 

21 or (6), the quantity of the international offset 

22 credits is determined by comparing the national 

23 emissions from deforestation relative to a na24 tional deforestation baseline for that country es25 tablished, in accordance with an agreement or 


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1 arrangement described in subsection (b)(2)(A), 

2 pursuant to paragraph (4); 

3 ‘‘(C) the reduction in emissions from de4 forestation has occurred before the issuance of 

5 the international offset credit and, taking into 

6 consideration relevant international standards, 

7 has been demonstrated using ground-based in8 ventories, remote sensing technology, and other 

9 methodologies to ensure that all relevant carbon 

10 stocks are accounted; 

11 ‘‘(D) the Administrator has made appro12 priate adjustments, such as discounting for any 

13 additional uncertainty, to account for cir14 cumstances specific to the country, including its 

15 technical capacity described in paragraph 

16 (2)(A); 

17 ‘‘(E) the activity is designed, carried out, 

18 and managed— 

19 ‘‘(i) in accordance with widely accept20 ed, environmentally sustainable forest 

21 management practices; 

22 ‘‘(ii) to promote or restore native for23 est species and ecosystems where prac24 ticable, and to avoid the introduction of 

25 invasive nonnative species; 


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1 ‘‘(iii) in a manner that gives due re2 gard to the rights and interests of local 

3 communities, indigenous peoples, forest-de4 pendent communities, and vulnerable social 

5 groups; 

6 ‘‘(iv) with consultations with, and full 

7 participation of, local communities, indige8 nous peoples, and forest-dependent com9 munities, in affected areas, as partners 

10 and primary stakeholders, prior to and 

11 during the design, planning, implementa12 tion, and monitoring and evaluation of ac13 tivities; and 

14 ‘‘(v) with equitable sharing of profits 

15 and benefits derived from offset credits 

16 with local communities, indigenous peoples, 

17 and forest-dependent communities; and 

18 ‘‘(F) the reduction otherwise satisfies and 

19 is consistent with any relevant requirements es20 tablished by an agreement reached under the 

21 auspices of the United Nations Framework 

22 Convention on Climate Change. 

23 ‘‘(2) ELIGIBLE COUNTRIES.—The Adminis24 trator, in consultation with the Secretary of State 

25 and the Administrator of the United States Agency 


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1 for International Development, and in accordance 

2 with an agreement or arrangement described in sub3 section (b)(2)(A), shall establish, and periodically re4 view and update, a list of the developing countries 

5 that have the capacity to participate in deforestation 

6 reduction activities at a national level, including— 

7 ‘‘(A) the technical capacity to monitor, 

8 measure, report, and verify forest carbon fluxes 

9 for all significant sources of greenhouse gas 

10 emissions from deforestation with an acceptable 

11 level of uncertainty, as determined taking into 

12 account relevant internationally accepted meth13 odologies, such as those established by the 

14 Intergovernmental Panel on Climate Change; 

15 ‘‘(B) the institutional capacity to reduce 

16 emissions from deforestation, including strong 

17 forest governance and mechanisms to equitably 

18 distribute deforestation resources for local ac19 tions; and 

20 ‘‘(C) a land use or forest sector strategic 

21 plan that— 

22 ‘‘(i) assesses national and local drivers 

23 of deforestation and forest degradation and 

24 identifies reforms to national policies need25 ed to address them; 


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1 ‘‘(ii) estimates the country’s emissions 

2 from deforestation and forest degradation; 

3 ‘‘(iii) identifies improvements in data 

4 collection, monitoring, and institutional ca5 pacity necessary to implement a national 

6 deforestation reduction program; and 

7 ‘‘(iv) establishes a timeline for imple8 menting the program and transitioning to 

9 low-emissions development with respect to 

10 emissions from forest and land use activi11 ties. 

12 ‘‘(3) PROTECTION OF INTERESTS.—With re13 spect to an agreement or arrangement described in 

14 subsection (b)(2)(A) that addresses international off15 set credits under this subsection, the Administrator, 

16 in consultation with the Secretary of State and the 

17 Administrator of the United States Agency for 

18 International Development, shall seek to ensure the 

19 establishment and enforcement by such country of 

20 legal regimes, processes, standards, and safeguards 

21 that— 

22 ‘‘(A) give due regard to the rights and in23 terests of local communities, indigenous peoples, 

24 forest-dependent communities, and vulnerable 

25 social groups; 


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1 ‘‘(B) promote consultations with, and full 

2 participation of, forest-dependent communities 

3 and indigenous peoples in affected areas, as 

4 partners and primary stakeholders, prior to and 

5 during the design, planning, implementation, 

6 and monitoring and evaluation of activities; and 

7 ‘‘(C) encourage equitable sharing of profits 

8 and benefits derived from international offset 

9 credits with local communities, indigenous peo10 ples, and forest-dependent communities. 

11 ‘‘(4) NATIONAL DEFORESTATION BASELINE.—A 

12 national deforestation baseline established under this 

13 subsection shall— 

14 ‘‘(A) be national in scope; 

15 ‘‘(B) be consistent with nationally appro16 priate mitigation commitments or actions with 

17 respect to deforestation, taking into consider18 ation the average annual historical deforestation 

19 rates of the country during a period of at least 

20 5 years, the applicable drivers of deforestation, 

21 and other factors to ensure additionality; 

22 ‘‘(C) establish a trajectory that would re23 sult in zero net deforestation by not later than 

24 20 years after the national deforestation base25 line has been established; 


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1 ‘‘(D) be adjusted over time to take account 

2 of changing national circumstances; 

3 ‘‘(E) be designed to account for all signifi4 cant sources of greenhouse gas emissions from 

5 deforestation in the country; and 

6 ‘‘(F) be consistent with the national defor7 estation baseline, if any, established for such 

8 country under section 754(d)(1) and (2). 

9 ‘‘(5) STATE-LEVEL OR PROVINCE-LEVEL AC10 TIVITIES.— 

11 ‘‘(A) ELIGIBLE STATES OR PROVINCES.— 

12 The Administrator, in consultation with the 

13 Secretary of State and the Administrator of the 

14 United States Agency for International Devel15 opment, shall establish within 2 years after the 

16 date of enactment of this title, and periodically 

17 review and update, a list of states or provinces 

18 in developing countries where— 

19 ‘‘(i) the developing country is not in20 cluded on the list of countries established 

21 pursuant to paragraph (6)(A); 

22 ‘‘(ii) the state or province by itself is 

23 a major emitter of greenhouse gases from 

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1 surate to the emissions of other countries; 

2 and 

3 ‘‘(iii) the state or province meets the 

4 eligibility criteria in paragraphs (2) and 

5 (3) for the geographic area under its juris6 diction. 

7 ‘‘(B) ACTIVITIES.—The Administrator may 

8 issue international offset credits for greenhouse 

9 gas emission reductions achieved through activi10 ties to reduce deforestation at a state or provin11 cial level that meet the requirements of this sec12 tion. Such credits shall be determined by com13 paring the emissions from deforestation within 

14 that state or province relative to the state or 

15 province deforestation baseline for that state or 

16 province established, in accordance with an 

17 agreement or arrangement described in sub18 section (b)(2)(A), pursuant to subparagraph 

19 (C) of this paragraph. 

20 ‘‘(C) STATE OR PROVINCE DEFOREST21 ATION BASELINE.—A state or province deforest22 ation baseline shall— 

23 ‘‘(i) be consistent with any existing 

24 nationally appropriate mitigation commit25 ments or actions for the country in which 


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1 the activity is occurring, taking into con2 sideration the average annual historical de3 forestation rates of the state or province 

4 during a period of at least 5 years, rel5 evant drivers of deforestation, and other 

6 factors to ensure additionality; 

7 ‘‘(ii) establish a trajectory that would 

8 result in zero net deforestation by not later 

9 than 20 years after the state or province 

10 deforestation baseline has been established; 

11 and 

12 ‘‘(iii) be designed to account for all 

13 significant sources of greenhouse gas emis14 sions from deforestation in the state or 

15 province and adjusted to fully account for 

16 emissions leakage outside the state or 

17 province. 

18 ‘‘(D) PHASE OUT.—Beginning 5 years 

19 after the first calendar year for which a covered 

20 entity must demonstrate compliance with sec21 tion 722(a), the Administrator shall issue no 

22 further international offset credits for eligible 

23 state-level or province-level activities to reduce 

24 deforestation pursuant to this paragraph. 


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1 ‘‘(6) PROJECTS AND PROGRAMS TO REDUCE

2 DEFORESTATION.— 

3 ‘‘(A) ELIGIBLE COUNTRIES.—The Admin4 istrator, in consultation with the Secretary of 

5 State and the Administrator of the United 

6 States Agency for International Development, 

7 shall establish within 2 years after the date of 

8 enactment of this title, and periodically review 

9 and update, a list of developing countries each 

10 of which— 

11 ‘‘(i) the Administrator determines, 

12 based on recent, credible, and reliable 

13 emissions data, accounts for less than 1 

14 percent of global greenhouse gas emissions 

15 and less than 3 percent of global forest16 sector and land use change greenhouse gas 

17 emissions; and 

18 ‘‘(ii) has, or in the determination of 

19 the Administrator is making a good faith 

20 effort to develop, a land use or forest sec21 tor strategic plan that meets the criteria 

22 described in paragraph (2)(C). 

23 ‘‘(B) ACTIVITIES.—The Administrator may 

24 issue international offset credits for greenhouse 

25 gas emission reductions achieved through 


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1 project or program level activities to reduce de2 forestation in countries listed under subpara3 graph (A) that meet the requirements of this 

4 section. The quantity of international offset 

5 credits shall be determined by comparing the 

6 project-level or program-level emissions from 

7 deforestation to a deforestation baseline for 

8 such project or program established pursuant to 

9 subparagraph (C). 

10 ‘‘(C) PROJECT-LEVEL OR PROGRAM-LEVEL

11 BASELINE.—A project-level or program-level de12 forestation baseline shall— 

13 ‘‘(i) be consistent with any existing 

14 nationally appropriate mitigation commit15 ments or actions for the country in which 

16 the project or program is occurring, taking 

17 into consideration the average annual his18 torical deforestation rates relevant to the 

19 specific project or program during a period 

20 of at least 5 years, applicable drivers of de21 forestation, and other factors to ensure 

22 additionality; 

23 ‘‘(ii) be designed to account for all 

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1 sions from deforestation in the project or 

2 program boundary; and 

3 ‘‘(iii) be adjusted to fully account for 

4 emissions leakage outside the project or 

5 program boundary. 

6 ‘‘(D) PHASE OUT.—(i) Beginning 5 years 

7 after the first calendar year for which a covered 

8 entity must demonstrate compliance with sec9 tion 722(a), the Administrator shall issue no 

10 further international offset credits for project11 level or program-level activities pursuant to this 

12 paragraph, except as provided in clause (ii). 

13 ‘‘(ii) The Administrator may extend the 

14 phase out deadline for the issuance of inter15 national offset credits under this paragraph by 

16 up to 8 years with respect to eligible activities 

17 taking place in a least developed country, which 

18 for purposes of this paragraph is defined as a 

19 foreign country that the United Nations has 

20 identified as among the least developed of devel21 oping countries at the time that the Adminis22 trator determines to provide an extension, if the 

23 Administrator, in consultation with the Sec24 retary of State and the Administrator of the 


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1 United States Agency for International Devel2 opment, determines the country— 

3 ‘‘(I) lacks sufficient capacity to adopt 

4 and implement effective programs to 

5 achieve reductions in deforestation meas6 ured against national baselines; 

7 ‘‘(II) is receiving support under part 

8 E to develop such capacity; and 

9 ‘‘(III) has developed and is working to 

10 implement a credible national strategy or 

11 plan to reduce deforestation. 

12 ‘‘(7) DEFORESTATION.—In implementing this 

13 subsection, the Administrator, taking into consider14 ation the recommendations of the Advisory Board, 

15 may include forest degradation, or soil carbon losses 

16 associated with forested wetlands or peatlands, with17 in the meaning of deforestation. 

18 ‘‘(8) CONSULTATION.—In implementing this 

19 subsection, the Administrator shall consult with the 

20 Secretary of Agriculture on relevant matters within 

21 such Secretary’s area of expertise. 

22 ‘‘(f) MODIFICATION OF REQUIREMENTS.—In promul23 gating regulations under subsection (b)(1) with respect to 

24 the issuance of international offset credits under sub25 section (c), (d), or (e), the Administrator, in consultation 


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1 with the Secretary of State and the Administrator of the 

2 United States Agency for International Development, may 

3 modify or omit a requirement of this part (excluding the 

4 requirements of this section) if the Administrator deter5 mines that the application of that requirement to such 

6 subsection is not feasible. In modifying or omitting such 

7 a requirement on the basis of infeasibility, the Adminis8 trator, in consultation with the Secretary of State and the 

9 Administrator of the United States Agency for Inter10 national Development, shall ensure, with an adequate 

11 margin of safety, the integrity of international offset cred12 its issued under this section and of the greenhouse gas 

13 emissions cap established pursuant to section 703. 

14 ‘‘(g) AVOIDING DOUBLE COUNTING.—The Adminis15 trator, in consultation with the Secretary of State, shall 

16 seek, by whatever means appropriate, including agree17 ments, arrangements, or technical cooperation, to ensure 

18 that activities on the basis of which international offset 

19 credits are issued under this section are not used for com20 pliance with an obligation to reduce or avoid greenhouse 

21 gas emissions, or increase greenhouse gas sequestration, 

22 under a foreign or international regulatory system. In ad23 dition, no international offset credits shall be issued for 

24 emission reductions from activities with respect to which 


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1 emission allowances were allocated under section 781 for 

2 distribution under part E. 

3 ‘‘(h) LIMITATION.—The Administrator shall not issue 

4 international offset credits generated by projects based on 

5 the destruction of hydrofluorocarbons. 

6 ‘‘PART E—SUPPLEMENTAL EMISSIONS 

7 REDUCTIONS FROM REDUCED DEFORESTATION 

8 ‘‘SEC. 751. DEFINITIONS. 

9 ‘‘In this part: 

10 ‘‘(1) LEAKAGE PREVENTION ACTIVITIES.—The 

11 term ‘leakage prevention activities’ means activities 

12 in developing countries that are directed at pre13 serving existing forest carbon stocks, including for14 ested wetlands and peatlands, that might, absent 

15 such activities, be lost through leakage. 

16 ‘‘(2) NATIONAL DEFORESTATION REDUCTION

17 ACTIVITIES.—The term ‘national deforestation re18 duction activities’ means activities in developing 

19 countries that reduce a quantity of greenhouse gas 

20 emissions from deforestation that is calculated by 

21 measuring actual emissions against a national defor22 estation baseline established pursuant to section 

23 754(d)(1) and (2). 

24 ‘‘(3) SUBNATIONAL DEFORESTATION REDUC25 TION ACTIVITIES.—The term ‘subnational deforestVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00665 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ation reduction activities’ means activities in devel2 oping countries that reduce a quantity of greenhouse 

3 gas emissions from deforestation that are calculated 

4 by measuring actual emissions using an appropriate 

5 baseline established by the Administrator that is less 

6 than national in scope. 

7 ‘‘(4) SUPPLEMENTAL EMISSIONS REDUC8 TIONS.—The term ‘supplemental emissions reduc9 tions’ means greenhouse gas emissions reductions 

10 achieved from reduced or avoided deforestation 

11 under this part. 

12 ‘‘(5) USAID.—The term ‘USAID’ means the 

13 United States Agency for International Develop14 ment. 

15 ‘‘SEC. 752. FINDINGS. 

16 ‘‘Congress finds that— 

17 ‘‘(1) as part of a global effort to mitigate cli18 mate change, it is in the national interest of the 

19 United States to assist developing countries to re20 duce and ultimately halt emissions from deforest21 ation; 

22 ‘‘(2) deforestation is one of the largest sources 

23 of greenhouse gas emissions in developing countries, 

24 amounting to roughly 20 percent of overall emissions 

25 globally; 


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1 ‘‘(3) recent scientific analysis shows that it will 

2 be substantially more difficult to limit the increase 

3 in global temperatures to less than 2 degrees centi4 grade above preindustrial levels without reducing 

5 and ultimately halting net emissions from deforest6 ation; 

7 ‘‘(4) reducing emissions from deforestation is 

8 highly cost-effective, compared to many other 

9 sources of emissions reductions; 

10 ‘‘(5) in addition to contributing significantly to 

11 worldwide efforts to address global warming, assist12 ance under this part will generate significant envi13 ronmental and social cobenefits, including protection 

14 of biodiversity, ecosystem services, and forest-related 

15 livelihoods; and 

16 ‘‘(6) under the Bali Action Plan, developed 

17 country parties to the United Nations Framework 

18 Convention on Climate Change, including the United 

19 States, committed to ‘enhanced action on the provi20 sion of financial resources and investment to support 

21 action on mitigation and adaptation and technology 

22 cooperation,’ including, inter alia, consideration of 

23 ‘improved access to adequate, predictable, and sus24 tainable financial resources and financial and tech25 nical support, and the provision of new and addiVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00667 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tional resources, including official and concessional 

2 funding for developing country parties’ . 

3 ‘‘SEC. 753. SUPPLEMENTAL EMISSIONS REDUCTIONS 

4 THROUGH REDUCED DEFORESTATION. 

5 ‘‘(a) REGULATIONS.—Not later than 2 years after 

6 the date of enactment of this title, the Administrator, in 

7 consultation with the Administrator of USAID and any 

8 other appropriate agencies, shall promulgate regulations 

9 establishing a program to use emission allowances set 

10 aside for this purpose under section 781 to reduce green11 house gas emissions from deforestation in developing 

12 countries in accordance with the requirements of this part. 

13 ‘‘(b) OBJECTIVES.—The objectives of the program es14 tablished under this section shall be to— 

15 ‘‘(1) achieve supplemental emissions reductions 

16 of at least 720,000,000 tons of carbon dioxide equiv17 alent in 2020, a cumulative amount of at least 

18 6,000,000,000 tons of carbon dioxide equivalent by 

19 December 31, 2025, and additional supplemental 

20 emissions reductions in subsequent years; 

21 ‘‘(2) build capacity to reduce deforestation in 

22 developing countries experiencing deforestation, in23 cluding preparing developing countries to participate 

24 in international markets for international offset 

25 credits for reduced emissions from deforestation; and 


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1 ‘‘(3) preserve existing forest carbon stocks in 

2 countries where such forest carbon may be vulner3 able to international leakage, particularly in devel4 oping countries with largely intact native forests. 

5 ‘‘SEC. 754. REQUIREMENTS FOR INTERNATIONAL DEFOR6 ESTATION REDUCTION PROGRAM. 

7 ‘‘(a) ELIGIBLE COUNTRIES.—The Administrator 

8 may support activities under this part only with respect 

9 to a developing country that— 

10 ‘‘(1) the Administrator, in consultation with the 

11 Administrator of USAID, determines is experiencing 

12 deforestation or forest degradation or has standing 

13 forest carbon stocks that may be at risk of deforest14 ation or degradation; and 

15 ‘‘(2) has entered into a bilateral or multilateral 

16 agreement or arrangement with the United States 

17 establishing the conditions of its participation in the 

18 program established under this part, which shall in19 clude an agreement to meet the standards estab20 lished under subsection (d) for the activities to 

21 which those standards apply. 

22 ‘‘(b) ACTIVITIES.— 

23 ‘‘(1) AUTHORIZED ACTIVITIES.—Subject to the 

24 requirements of this part, the Administrator, in con25 sultation with the Administrator of USAID, may 


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1 support activities to achieve the objectives identified 

2 in section 753(b), including— 

3 ‘‘(A) national deforestation reduction ac4 tivities; 

5 ‘‘(B) subnational deforestation reduction 

6 activities, including pilot activities that reduce 

7 greenhouse gas emissions but are subject to sig8 nificant uncertainty; 

9 ‘‘(C) activities to measure, monitor, and 

10 verify deforestation, avoided deforestation, and 

11 deforestation rates; 

12 ‘‘(D) leakage prevention activities; 

13 ‘‘(E) development of measurement, moni14 toring, and verification capacities to enable a 

15 country to quantify supplemental emissions re16 ductions and to generate for sale offset credits 

17 from reduced or avoided deforestation; 

18 ‘‘(F) development of governance structures 

19 to reduce deforestation and illegal logging; 

20 ‘‘(G) enforcement of requirements for re21 duced deforestation or forest conservation; 

22 ‘‘(H) efforts to combat illegal logging and 

23 increase enforcement cooperation; 


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1 ‘‘(I) providing incentives for policy reforms 

2 to achieve the objectives identified in section 

3 753(b); and 

4 ‘‘(J) monitoring and evaluation of the re5 sults of the activities conducted under this sec6 tion. 

7 ‘‘(2) ACTIVITIES SELECTED BY USAID.— 

8 ‘‘(A) The Administrator of USAID, in con9 sultation with the Administrator, may select for 

10 support and implementation pursuant to sub11 section (c) any of the activities described in 

12 paragraph (1), consistent with this part and the 

13 regulations promulgated under subsection (d), 

14 and subject to the requirement to achieve the 

15 objectives listed in section 753(b)(1). 

16 ‘‘(B) With respect to the activities listed in 

17 subparagraphs (D) through (J) of paragraph 

18 (1), the Administrator of USAID, in consulta19 tion with the Administrator, shall have primary 

20 but not exclusive responsibility for selecting the 

21 activities to be supported and implemented. 

22 ‘‘(3) INTERAGENCY COORDINATION.—The Ad23 ministrator and the Administrator of USAID shall 

24 jointly develop and biennially update a strategic plan 

25 for meeting the objectives listed in section 753(b) 


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1 and shall execute a memorandum of understanding 

2 delineating the agencies’ respective roles in imple3 menting this part. 

4 ‘‘(c) MECHANISMS.— 

5 ‘‘(1) IN GENERAL.—The Administrator may 

6 support activities to achieve the objectives identified 

7 in section 753(b) by— 

8 ‘‘(A) developing and implementing pro9 grams and projects that achieve such objectives; 

10 and 

11 ‘‘(B) distributing emission allowances to a 

12 country that is eligible under subsection (a), to 

13 a private or public group (including inter14 national organizations), or to an international 

15 fund established by an international agreement 

16 to which the United States is a party, to carry 

17 out activities to achieve such objectives. 

18 ‘‘(2) USAID ACTIVITIES.—With respect to ac19 tivities selected and implemented by the Adminis20 trator of USAID pursuant to subsection (b)(2), the 

21 Administrator shall distribute emission allowances as 

22 provided in paragraph (1) of this subsection based 

23 upon the direction of the Administrator of USAID, 

24 subject to the availability of allowances for such ac25 tivities. 


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1 ‘‘(3) IMPLEMENTATION THROUGH INTER2 NATIONAL ORGANIZATIONS.—If support is distrib3 uted through an international organization, the 

4 agency responsible for selecting activities in accord5 ance with subsection (b)(1) or (2), in consultation 

6 with the Secretary of State, shall ensure the estab7 lishment and implementation of adequate mecha8 nisms to apply and enforce the eligibility require9 ments and other requirements of this section. 

10 ‘‘(4) ROLE OF THE SECRETARY OF STATE.— 

11 The Administrator may not distribute emission al12 lowances under this part to the government of an13 other country or to an international organization or 

14 international fund unless the Secretary of State has 

15 concurred with such distribution. 

16 ‘‘(d) STANDARDS.—The Administrator, in consulta17 tion with the Administrator of USAID, shall promulgate 

18 regulations establishing standards to ensure that supple19 mental emissions reductions achieved through supported 

20 activities are additional, measurable, verifiable, perma21 nent, and monitored, and account for leakage and uncer22 tainty. In addition, such standards shall— 

23 ‘‘(1) require the establishment of a national de24 forestation baseline for each country with national 


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1 deforestation reduction activities that is used to ac2 count for reductions achieved from such activities; 

3 ‘‘(2) provide that a national deforestation base4 line established under paragraph (1) shall— 

5 ‘‘(A) be national in scope; 

6 ‘‘(B) be consistent with nationally appro7 priate mitigation commitments or actions with 

8 respect to deforestation, taking into consider9 ation the average annual historical deforestation 

10 rates of the country during a period of at least 

11 5 years, the applicable drivers of deforestation, 

12 and other factors to ensure additionality; 

13 ‘‘(C) establish a trajectory that would re14 sult in zero net deforestation by not later than 

15 20 years from the date the baseline is estab16 lished; 

17 ‘‘(D) be adjusted over time to take account 

18 of changing national circumstances; 

19 ‘‘(E) be designed to account for all signifi20 cant sources of greenhouse gas emissions from 

21 deforestation in the country; and 

22 ‘‘(F) be consistent with the national defor23 estation baseline, if any, established for such 

24 country under section 743(e)(4); 


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1 ‘‘(3) with respect to support provided pursuant 

2 to subsection (b)(1)(A) or (B), require supplemental 

3 emissions reductions to be achieved and verified 

4 prior to compensation through the distribution of 

5 emission allowances under this part; 

6 ‘‘(4) with respect to accounting for subnational 

7 deforestation reduction activities that lack the stand8 ardized or precise measurement and monitoring 

9 techniques needed for a full accounting of changes 

10 in emissions or baselines, or are subject to other 

11 sources of uncertainty, apply a conservative discount 

12 factor to reflect the uncertainty regarding the levels 

13 of reductions achieved; 

14 ‘‘(5) ensure that activities under this part shall 

15 be designed, carried out, and managed— 

16 ‘‘(A) in accordance with widely accepted, 

17 environmentally sustainable forest management 

18 practices; 

19 ‘‘(B) to promote or restore native forest 

20 species and ecosystems where practicable, and 

21 to avoid the introduction of invasive nonnative 

22 species; 

23 ‘‘(C) in a manner that gives due regard to 

24 the rights and interests of local communities, 


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1 indigenous peoples, forest-dependent commu2 nities, and vulnerable social groups; 

3 ‘‘(D) with consultations with, and full par4 ticipation of, local communities, indigenous peo5 ples, and forest-dependent communities in af6 fected areas, as partners and primary stake7 holders, prior to and during the design, plan8 ning, implementation, and monitoring and eval9 uation of activities; and 

10 ‘‘(E) with equitable sharing of profits and 

11 benefits derived from the activities with local 

12 communities, indigenous peoples, and forest-de13 pendent communities; and 

14 ‘‘(6) with respect to support for all activities 

15 under this part, seek to ensure the establishment 

16 and enforcement, by the country in which the activi17 ties occur, of legal regimes, standards, processes, 

18 and safeguards that— 

19 ‘‘(A) give due regard to the rights and in20 terests of local communities, indigenous peoples, 

21 forest-dependent communities, and vulnerable 

22 social groups; 

23 ‘‘(B) promote consultations with local com24 munities and indigenous peoples and forest-de25 pendent communities in affected areas, as partVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00676 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ners and primary stakeholders, prior to and 

2 during the design, planning, implementation, 

3 monitoring, and evaluation of activities under 

4 this part; and 

5 ‘‘(C) encourage equitable sharing of profits 

6 and benefits from incentives for emissions re7 ductions or leakage prevention with local com8 munities, indigenous peoples, and forest-de9 pendent communities. 

10 ‘‘(e) SCOPE.—(1) The Administrator shall include 

11 within the scope of activities under this part reduced emis12 sions from forest degradation. 

13 ‘‘(2) The Administrator, in consultation with the Ad14 ministrator of USAID, may decide, taking into account 

15 any advice from the Advisory Board, to expand, where ap16 propriate, the scope of activities under this part to include 

17 reduced soil carbon-derived emissions associated with de18 forestation and degradation of forested wetlands and 

19 peatlands. 

20 ‘‘(f) ACCOUNTING.—The Administrator shall estab21 lish a publicly accessible registry of the supplemental emis22 sions reductions achieved through support provided under 

23 this part each year, after appropriately discounting for un24 certainty and other relevant factors as required by the 

25 standards established under subsection (d). 


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1 ‘‘(g) TRANSITION TO NATIONAL REDUCTIONS.—Be2 ginning 5 years after the date that a country entered into 

3 the agreement or arrangement required under subsection 

4 (a)(2), the Administrator shall provide no further com5 pensation through emission allowances to that country 

6 under this part for any subnational deforestation reduc7 tion activities, except that the Administrator may extend 

8 this period by an additional 5 years if the Administrator, 

9 in consultation with the Administrator of USAID, deter10 mines that— 

11 ‘‘(1) the country is making substantial progress 

12 towards adopting and implementing a program to 

13 achieve reductions in deforestation measured against 

14 a national baseline; 

15 ‘‘(2) the greenhouse gas emissions reductions 

16 achieved are not resulting in significant leakage; and 

17 ‘‘(3) the greenhouse gas emissions reductions 

18 achieved are being appropriately discounted to ac19 count for any leakage that is occurring. 

20 The limitation under this subsection shall not apply to 

21 support for activities to further the objectives listed in sec22 tion 753(b)(2) or (3). 

23 ‘‘(h) COORDINATION WITH U.S. FOREIGN ASSIST24 ANCE.—Subject to the direction of the President, the Ad25 ministrator and the Administrator of USAID shall, to the 


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1 extent practicable and consistent with the objectives of 

2 this program, seek to align activities under this section 

3 with broader development, poverty alleviation, or natural 

4 resource management objectives and initiatives in the re5 cipient country. 

6 ‘‘(i) SUPPORT AS SUPPLEMENT.—The provision of 

7 support for activities under this part shall be used to sup8 plement, and not to supplant, any other Federal, State, 

9 or local support available to carry out such qualifying ac10 tivities under this part. 

11 ‘‘(j) NOT ELIGIBLE FOR OFFSET CREDIT.—Activities 

12 that receive support under this part shall not be issued 

13 offset credits for the greenhouse gas emissions reductions 

14 or avoidance, or greenhouse gas sequestration, produced 

15 by such activities. 

16 ‘‘SEC. 755. REPORTS AND REVIEWS. 

17 ‘‘(a) REPORTS.—Not later than January 1, 2014, 

18 and annually thereafter, the Administrator and the Ad19 ministrator of USAID shall submit to the Committee on 

20 Energy and Commerce and the Committee on Foreign Af21 fairs of the House of Representatives, and the Committee 

22 on Environment and Public Works and the Committee on 

23 Foreign Relations of the Senate, and make available to 

24 the public, a report on the support provided under this 


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1 part during the prior fiscal year. The report shall in2 clude— 

3 ‘‘(1) a statement of the quantity of supple4 mental emissions reductions for which compensation 

5 in the form of emission allowances was provided 

6 under this part during the prior fiscal year, as reg7 istered by the Administrator under section 754(f); 

8 and 

9 ‘‘(2) a description of the national and sub10 national deforestation reduction activities, capacity11 building activities, and leakage prevention activities 

12 supported under this part, including a statement of 

13 the quantity of emission allowances distributed to 

14 each recipient for each activity during the prior fis15 cal year, and a description of what was accomplished 

16 through each of the activities. 

17 ‘‘(b) REVIEWS.—Not later than 4 years after the date 

18 of enactment of this title and every 5 years thereafter, 

19 the Administrator and the Administrator of USAID, tak20 ing into consideration any evaluation by or recommenda21 tions from the Advisory Board established under section 

22 731, shall conduct a review of the activities undertaken 

23 pursuant to this part and make any appropriate changes 

24 in the program established under this part, consistent with 

25 the requirements of this part, based on the findings of the 


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1 review. The review shall include the effects of the activities 

2 on— 

3 ‘‘(1) total documented carbon stocks of each 

4 country that directly or indirectly received support 

5 under this part compared with such country’s na6 tional deforestation baseline established under sec7 tion 754(d)(1) and (2); 

8 ‘‘(2) the number of countries with the capacity 

9 to generate for sale instruments in the nature of off10 set credits from forest-related activities, and the 

11 amount of such activities; 

12 ‘‘(3) forest governance in each country that di13 rectly or indirectly received support under this part; 

14 ‘‘(4) indigenous peoples and forest-dependent 

15 communities residing in areas affected by such ac16 tivities; 

17 ‘‘(5) biodiversity and ecosystem services within 

18 forested areas associated with the activities; 

19 ‘‘(6) subnational and international leakage; and 

20 ‘‘(7) any program or mechanism established 

21 under the United Nations Framework Convention on 

22 Climate Change related to greenhouse gas emissions 

23 from deforestation. 


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1 ‘‘SEC. 756. LEGAL EFFECT OF PART. 

2 ‘‘(1) IN GENERAL.—Nothing in this part super3 sedes, limits, or otherwise affects any restriction im4 posed by Federal law (including regulations) on any 

5 interaction between an entity located in the United 

6 States and an entity located in a foreign country. 

7 ‘‘(2) ROLE OF THE SECRETARY OF STATE.— 

8 Nothing in this part shall be construed as affecting 

9 the role of the Secretary of State or the responsibil10 ities of the Secretary under section 622(c) of the 

11 Foreign Assistance Act of 1961.’’. 

12 SEC. 312. DEFINITIONS. 

13 Title VII of the Clean Air Act, as added by section 

14 311 of this Act, is amended by inserting before part A 

15 the following new section: 

16 ‘‘SEC. 700. DEFINITIONS. 

17 ‘‘In this title: 

18 ‘‘(1) ADDITIONAL.—The term ‘additional’, 

19 when used with respect to reductions or avoidance of 

20 greenhouse gas emissions, or to sequestration of 

21 greenhouse gases, means reductions, avoidance, or 

22 sequestration that result in a lower level of net 

23 greenhouse gas emissions or atmospheric concentra24 tions than would occur in the absence of an offset 

25 project. 


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1 ‘‘(2) ADDITIONALITY.—The term ‘additionality’ 

2 means the extent to which reductions or avoidance 

3 of greenhouse gas emissions, or sequestration of 

4 greenhouse gases, are additional. 

5 ‘‘(3) ADVISORY BOARD.—The term ‘Advisory 

6 Board’ means the Offsets Integrity Advisory Board 

7 established under section 731. 

8 ‘‘(4) AFFILIATED.—The term ‘affiliated’— 

9 ‘‘(A) when used in relation to an entity 

10 means owned or controlled by, or under com11 mon ownership or control with, another entity, 

12 as determined by the Administrator; and 

13 ‘‘(B) when used in relation to a natural 

14 gas local distribution company, means owned or 

15 controlled by, or under common ownership or 

16 control with, another natural gas local distribu17 tion company, as determined by the Adminis18 trator. 

19 ‘‘(5) ALLOWANCE.—The term ‘allowance’ 

20 means a limited authorization to emit, or have at21 tributable greenhouse gas emissions in an amount 

22 of, 1 ton of carbon dioxide equivalent of a green23 house gas in accordance with this title. Such term 

24 includes an emission allowance, a compensatory al25 lowance, and an international emission allowance, 


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1 but does not include an international reserve allow2 ance established under section 766. 

3 ‘‘(6) ATTRIBUTABLE GREENHOUSE GAS EMIS4 SIONS.—The term ‘attributable greenhouse gas emis5 sions’, for a given calendar year, means— 

6 ‘‘(A) for a covered entity that is a fuel pro7 ducer or importer described in paragraph 

8 (13)(B), greenhouse gases that would be emit9 ted from the combustion of any petroleum10 based or coal-based liquid fuel, petroleum coke, 

11 or natural gas liquid, produced or imported by 

12 that covered entity during that calendar year 

13 for sale or distribution in interstate commerce, 

14 assuming no capture and sequestration of any 

15 greenhouse gas emissions; 

16 ‘‘(B) for a covered entity that is an indus17 trial gas producer or importer described in 

18 paragraph (13)(C), the tons of carbon dioxide 

19 equivalent of any gas described in clauses (i) 

20 through (vi) of paragraph (13)(C)— 

21 ‘‘(i) produced or imported by such 

22 covered entity during that calendar year 

23 for sale or distribution in interstate com24 merce; or 


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1 ‘‘(ii) released as fugitive emissions in 

2 the production of fluorinated gas; and 

3 ‘‘(C) for a natural gas local distribution 

4 company described in paragraph (13)(J), green5 house gases that would be emitted from the 

6 combustion of the natural gas, and any other 

7 gas meeting the specifications for commingling 

8 with natural gas for purposes of delivery, that 

9 such entity delivered during that calendar year 

10 to customers that are not covered entities, as11 suming no capture and sequestration of that 

12 greenhouse gas. 

13 ‘‘(7) BIOLOGICAL SEQUESTRATION; BIO14 LOGICALLY SEQUESTERED.—The terms ‘biological 

15 sequestration’ and ‘biologically sequestered’ mean 

16 the removal of greenhouse gases from the atmos17 phere by terrestrial biological means, such as by 

18 growing plants, and the storage of those greenhouse 

19 gases in plants or soils. 

20 ‘‘(8) CAPPED EMISSIONS.—The term ‘capped 

21 emissions’ means greenhouse gas emissions to which 

22 section 722 applies, including emissions from the 

23 combustion of natural gas, petroleum-based or coal24 based liquid fuel, petroleum coke, or natural gas liq25 uid to which section 722(b)(2) or (8) applies. 


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1 ‘‘(9) CAPPED SOURCE.—The term ‘capped 

2 source’ means a source that directly emits capped 

3 emissions. 

4 ‘‘(10) CARBON DIOXIDE EQUIVALENT.—The 

5 term ‘carbon dioxide equivalent’ means the unit of 

6 measure, expressed in metric tons, of greenhouse 

7 gases as provided under section 711 or 712. 

8 ‘‘(11) CARBON STOCK.—The term ‘carbon 

9 stock’ means the quantity of carbon contained in a 

10 biological reservoir or system which has the capacity 

11 to accumulate or release carbon. 

12 ‘‘(12) COMPENSATORY ALLOWANCE.—The term 

13 ‘compensatory allowance’ means an allowance issued 

14 under section 721(f). 

15 ‘‘(13) COVERED ENTITY.—The term ‘covered 

16 entity’ means each of the following: 

17 ‘‘(A) Any electricity source. 

18 ‘‘(B) Any stationary source that produces, 

19 and any entity that (or any group of two or 

20 more affiliated entities that, in the aggregate) 

21 imports, for sale or distribution in interstate 

22 commerce in 2008 or any subsequent year, pe23 troleum-based or coal-based liquid fuel, petro24 leum coke, or natural gas liquid, the combus25 tion of which would emit 25,000 or more tons 


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1 of carbon dioxide equivalent, as determined by 

2 the Administrator. 

3 ‘‘(C) Any stationary source that produces, 

4 and any entity that (or any group of two or 

5 more affiliated entities that, in the aggregate) 

6 imports, for sale or distribution in interstate 

7 commerce, in bulk, or in products designated by 

8 the Administrator, in 2008 or any subsequent 

9 year 25,000 or more tons of carbon dioxide 

10 equivalent of— 

11 ‘‘(i) fossil fuel-based carbon dioxide; 

12 ‘‘(ii) nitrous oxide; 

13 ‘‘(iii) perfluorocarbons; 

14 ‘‘(iv) sulfur hexafluoride; 

15 ‘‘(v) any other fluorinated gas, except 

16 for nitrogen trifluoride, that is a green17 house gas, as designated by the Adminis18 trator under section 711; or 

19 ‘‘(vi) any combination of greenhouse 

20 gases described in clauses (i) through (v). 

21 ‘‘(D) Any stationary source that has emit22 ted 25,000 or more tons of carbon dioxide 

23 equivalent of nitrogen trifluoride in 2008 or any 

24 subsequent year. 

25 ‘‘(E) Any geologic sequestration site. 


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1 ‘‘(F) Any stationary source in the following 

2 industrial sectors: 

3 ‘‘(i) Adipic acid production. 

4 ‘‘(ii) Primary aluminum production. 

5 ‘‘(iii) Ammonia manufacturing. 

6 ‘‘(iv) Cement production, excluding 

7 grinding-only operations. 

8 ‘‘(v) Hydrochlorofluorocarbon produc9 tion. 

10 ‘‘(vi) Lime manufacturing. 

11 ‘‘(vii) Nitric acid production. 

12 ‘‘(viii) Petroleum refining. 

13 ‘‘(ix) Phosphoric acid production. 

14 ‘‘(x) Silicon carbide production. 

15 ‘‘(xi) Soda ash production. 

16 ‘‘(xii) Titanium dioxide production. 

17 ‘‘(xiii) Coal-based liquid or gaseous 

18 fuel production. 

19 ‘‘(G) Any stationary source in the chemical 

20 or petrochemical sector that, in 2008 or any 

21 subsequent year— 

22 ‘‘(i) produces acrylonitrile, carbon 

23 black, ethylene, ethylene dichloride, ethyl24 ene oxide, or methanol; or 


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1 ‘‘(ii) produces a chemical or petro2 chemical product if producing that product 

3 results in annual combustion plus process 

4 emissions of 25,000 or more tons of carbon 

5 dioxide equivalent. 

6 ‘‘(H) Any stationary source that— 

7 ‘‘(i) is in one of the following indus8 trial sectors: ethanol production; ferroalloy 

9 production; fluorinated gas production; 

10 food processing; glass production; hydrogen 

11 production; iron and steel production; lead 

12 production; pulp and paper manufacturing; 

13 and zinc production; and 

14 ‘‘(ii) has emitted 25,000 or more tons 

15 of carbon dioxide equivalent in 2008 or 

16 any subsequent year. 

17 ‘‘(I) Any fossil fuel-fired combustion device 

18 (such as a boiler) or grouping of such devices 

19 that— 

20 ‘‘(i) is all or part of an industrial 

21 source not specified in subparagraph (D), 

22 (F), (G), or (H); and 

23 ‘‘(ii) has emitted 25,000 or more tons 

24 of carbon dioxide equivalent in 2008 or 

25 any subsequent year. 


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1 ‘‘(J) Any natural gas local distribution 

2 company that (or any group of 2 or more affili3 ated natural gas local distribution companies 

4 that, in the aggregate), in 2008 or any subse5 quent year, delivers 460,000,000 cubic feet or 

6 more of natural gas, and any other gas meeting 

7 the specifications for commingling with natural 

8 gas for purposes of delivery, to customers that 

9 are not covered entities. 

10 ‘‘(14) CREDITING PERIOD.—The term ‘crediting 

11 period’ means the period with respect to which an 

12 offset project is eligible to earn offset credits under 

13 part D, as determined under section 734(c). 

14 ‘‘(15) DESIGNATED REPRESENTATIVE.—The 

15 term ‘designated representative’ means, with respect 

16 to a covered entity, a reporting entity (as defined in 

17 section 713), an offset project developer, or any 

18 other entity receiving or holding allowances or offset 

19 credits under this title, an individual authorized, 

20 through a certificate of representation submitted to 

21 the Administrator by the owners and operators or 

22 similar entity official, to represent the owners and 

23 operators or similar entity official in all matters per24 taining to this title (including the holding, transfer, 

25 or disposition of allowances or offset credits), and to 


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1 make all submissions to the Administrator under 

2 this title. 

3 ‘‘(16) DEVELOPING COUNTRY.—The term ‘de4 veloping country’ means a country eligible to receive 

5 official development assistance according to the in6 come guidelines of the Development Assistance Com7 mittee of the Organization for Economic Coopera8 tion and Development. 

9 ‘‘(17) DOMESTIC OFFSET CREDIT.—The term 

10 ‘domestic offset credit’ means an offset credit issued 

11 under part D, other than an international offset 

12 credit. 

13 ‘‘(18) ELECTRICITY SOURCE.—The term ‘elec14 tricity source’ means a stationary source that in15 cludes one or more utility units. 

16 ‘‘(19) EMISSION.—The term ‘emission’ means 

17 the release of a greenhouse gas into the ambient air. 

18 Such term does not include gases that are captured 

19 and geologically sequestered, except to the extent 

20 that they are later released into the atmosphere, in 

21 which case compliance must be demonstrated pursu22 ant to section 722(b)(5). 

23 ‘‘(20) EMISSION ALLOWANCE.—The term ‘emis24 sion allowance’ means an allowance established 


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1 under section 721(a) or section 726(g)(2) or 

2 (h)(1)(C). 

3 ‘‘(21) FAIR MARKET VALUE.—The term ‘fair 

4 market value’ means the average daily closing price 

5 on registered exchanges or, if such a price is un6 available, the average price as determined by the Ad7 ministrator, during a specified time period, of an 

8 emission allowance. 

9 ‘‘(22) FEDERAL LAND.—The term ‘Federal 

10 land’ means land that is owned by the United 

11 States, other than land held in trust for an Indian 

12 or Indian tribe. 

13 ‘‘(23) FOSSIL FUEL.—The term ‘fossil fuel’ 

14 means natural gas, petroleum, or coal, or any form 

15 of solid, liquid, or gaseous fuel derived from such 

16 material, including consumer products that are de17 rived from such materials and are combusted. 

18 ‘‘(24) FOSSIL FUEL-FIRED.—The term ‘fossil 

19 fuel-fired’ means powered by combustion of fossil 

20 fuel, alone or in combination with any other fuel, re21 gardless of the percentage of fossil fuel consumed. 

22 ‘‘(25) FUGITIVE EMISSIONS.—The term ‘fugi23 tive emissions’ means emissions from leaks, valves, 

24 joints, or other small openings in pipes, ducts, or 

25 other equipment, or from vents. 


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1 ‘‘(26) GEOLOGIC SEQUESTRATION; GEOLOGI2 CALLY SEQUESTERED.—The terms ‘geologic seques3 tration’ and ‘geologically sequestered’ mean the se4 questration of greenhouse gases in subsurface geo5 logic formations for purposes of permanent storage. 

6 ‘‘(27) GEOLOGIC SEQUESTRATION SITE.—The 

7 term ‘geologic sequestration site’ means a site where 

8 carbon dioxide is geologically sequestered. 

9 ‘‘(28) GREENHOUSE GAS.—The term ‘green10 house gas’ means any gas described in section 

11 711(a) or designated under section 711, except to 

12 the extent that it is regulated under title VI. 

13 ‘‘(29) HIGH CONSERVATION PRIORITY LAND.— 

14 The term ‘high conservation priority land’ means 

15 land that is not Federal land and is— 

16 ‘‘(A) globally or State ranked as critically 

17 imperiled or imperiled under a State Natural 

18 Heritage Program; or 

19 ‘‘(B) old-growth or late-successional forest, 

20 as identified by the office of the State Forester 

21 or relevant State agency with regulatory juris22 diction over forestry activities. 

23 ‘‘(30) HOLD.—The term ‘hold’ means, with re24 spect to an allowance or offset credit, to have in the 

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1 tem established under section 724(d), or submit to 

2 the Administrator for recording in such account. 

3 ‘‘(31) INDUSTRIAL SOURCE.—The term ‘indus4 trial source’ means any stationary source that— 

5 ‘‘(A) is not an electricity source; and 

6 ‘‘(B) is in— 

7 ‘‘(i) the manufacturing sector (as de8 fined in North American Industrial Classi9 fication System codes 31, 32, and 33); or 

10 ‘‘(ii) the natural gas processing or 

11 natural gas pipeline transportation sector 

12 (as defined in North American Industrial 

13 Classification System codes 211112 and 

14 486210). 

15 ‘‘(32) INTERNATIONAL EMISSION ALLOW16 ANCE.—The term ‘international emission allowance’ 

17 means a tradable authorization to emit 1 ton of car18 bon dioxide equivalent of greenhouse gas that is 

19 issued by a national or supranational foreign govern20 ment pursuant to a qualifying international program 

21 designated by the Administrator pursuant to section 

22 728(a). 

23 ‘‘(33) INTERNATIONAL OFFSET CREDIT.—The 

24 term ‘international offset credit’ means an offset 


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1 credit issued by the Administrator under section 

2 743. 

3 ‘‘(34) LEAKAGE.—Except as provided in part 

4 F, the term ‘leakage’ means a significant increase in 

5 greenhouse gas emissions, or significant decrease in 

6 sequestration, which is caused by an offset project or 

7 activities under part E and occurs outside the 

8 boundaries of the offset project or the relevant pro9 gram or project under part E. 

10 ‘‘(35) MINERAL SEQUESTRATION.—The term 

11 ‘mineral sequestration’ means sequestration of car12 bon dioxide from the atmosphere by capturing car13 bon dioxide into a permanent mineral, such as the 

14 aqueous precipitation of carbonate minerals that re15 sults in the storage of carbon dioxide in a mineral 

16 form. 

17 ‘‘(36) NATURAL GAS LIQUID.—The term ‘nat18 ural gas liquid’ means ethane, butane, isobutane, 

19 natural gasoline, and propane. 

20 ‘‘(37) NATURAL GAS LOCAL DISTRIBUTION

21 COMPANY.—The term ‘natural gas local distribution 

22 company’ has the meaning given the term ‘local dis23 tribution company’ in section 2(17) of the Natural 

24 Gas Policy Act of 1978 (15 U.S.C. 3301(17)). 


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1 ‘‘(38) OFFSET CREDIT.—The term ‘offset cred2 it’ means a credit issued under part D. 

3 ‘‘(39) OFFSET PROJECT.—The term ‘offset 

4 project’ means a project or activity that reduces or 

5 avoids greenhouse gas emissions, or sequesters 

6 greenhouse gases, and for which offset credits are or 

7 may be issued under part D. 

8 ‘‘(40) OFFSET PROJECT DEVELOPER.—The 

9 term ‘offset project developer’ means the individual 

10 or entity designated as the offset project developer 

11 in an offset project approval petition under section 

12 735(c)(1). 

13 ‘‘(41) PETROLEUM.—The term ‘petroleum’ in14 cludes crude oil, tar sands, oil shale, and heavy oils. 

15 ‘‘(42) RENEWABLE BIOMASS.—The term ‘re16 newable biomass’ means any of the following: 

17 ‘‘(A) Plant material, including waste mate18 rial, harvested or collected from actively man19 aged agricultural land that was in cultivation, 

20 cleared, or fallow and nonforested on January 

21 1, 2009. 

22 ‘‘(B) Plant material, including waste mate23 rial, harvested or collected from pastureland 

24 that was nonforested on January 1, 2009. 


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1 ‘‘(C) Nonhazardous vegetative matter de2 rived from waste, including separated yard 

3 waste, landscape right-of-way trimmings, con4 struction and demolition debris or food waste 

5 (but not municipal solid waste, recyclable waste 

6 paper, painted, treated or pressurized wood, or 

7 wood contaminated with plastic or metals). 

8 ‘‘(D) Animal waste or animal byproducts, 

9 including products of animal waste digesters. 

10 ‘‘(E) Algae. 

11 ‘‘(F) Trees, brush, slash, residues, or any 

12 other vegetative matter removed from within 

13 600 feet of any building, campground, or route 

14 designated for evacuation by a public official 

15 with responsibility for emergency preparedness, 

16 or from within 300 feet of a paved road, electric 

17 transmission line, utility tower, or water supply 

18 line. 

19 ‘‘(G) Residues from or byproducts of 

20 milled logs. 

21 ‘‘(H) Any of the following removed from 

22 forested land that is not Federal land and is 

23 not high conservation priority land: 

24 ‘‘(i) Trees, brush, slash, residues, 

25 interplanted energy crops, or any other 


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1 vegetative matter removed from an actively 

2 managed tree plantation established— 

3 ‘‘(I) prior to January 1, 2009; or 

4 ‘‘(II) on land that, as of January 

5 1, 2009, was cultivated or fallow and 

6 non-forested. 

7 ‘‘(ii) Trees, logging residue, thinnings, 

8 cull trees, pulpwood, and brush removed 

9 from naturally-regenerated forests or other 

10 non-plantation forests, including for the 

11 purposes of hazardous fuel reduction or 

12 preventative treatment for reducing or con13 taining insect or disease infestation. 

14 ‘‘(iii) Logging residue, thinnings, cull 

15 trees, pulpwood, brush and species that are 

16 non-native and noxious, from stands that 

17 were planted and managed after January 

18 1, 2009, to restore or maintain native for19 est types. 

20 ‘‘(iv) Dead or severely damaged trees 

21 removed within 5 years of fire, blowdown, 

22 or other natural disaster, and badly in23 fested trees. 

24 ‘‘(I) Materials, pre-commercial thinnings, 

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1 est System land and public lands (as defined in 

2 section 103 of the Federal Land Policy and 

3 Management Act of 1976 (43 U.S.C. 1702)), 

4 including those that are byproducts of preven5 tive treatments (such as trees, wood, brush, 

6 thinnings, chips, and slash), that are removed 

7 as part of a federally recognized timber sale, or 

8 that are removed to reduce hazardous fuels, to 

9 reduce or contain disease or insect infestation, 

10 or to restore ecosystem health, and that are— 

11 ‘‘(i) not from components of the Na12 tional Wilderness Preservation System, 

13 Wilderness Study Areas, Inventoried 

14 Roadless Areas, old growth or mature for15 est stands, components of the National 

16 Landscape Conservation System, National 

17 Monuments, National Conservation Areas, 

18 Designated Primitive Areas; or Wild and 

19 Scenic Rivers corridors; 

20 ‘‘(ii) harvested in environmentally sus21 tainable quantities, as determined by the 

22 appropriate Federal land manager; and 

23 ‘‘(iii) harvested in accordance with 

24 Federal and State law, and applicable land 

25 management plans. 


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1 ‘‘(43) RETIRE.—The term ‘retire’, with respect 

2 to an allowance or offset credit established or issued 

3 under this title, means to disqualify such allowance 

4 or offset credit for any subsequent use under this 

5 title, regardless of whether the use is a sale, ex6 change, or submission of the allowance or offset 

7 credit to satisfy a compliance obligation. 

8 ‘‘(44) REVERSAL.—The term ‘reversal’ means 

9 an intentional or unintentional loss of sequestered 

10 greenhouse gases to the atmosphere. 

11 ‘‘(45) SEQUESTERED AND SEQUESTRATION.— 

12 The terms ‘sequestered’ and ‘sequestration’ mean 

13 the separation, isolation, or removal of greenhouse 

14 gases from the atmosphere, as determined by the 

15 Administrator. The terms include biological, geo16 logic, and mineral sequestration, but do not include 

17 ocean fertilization techniques. 

18 ‘‘(46) STATIONARY SOURCE.—The term ‘sta19 tionary source’ means any integrated operation com20 prising any plant, building, structure, or stationary 

21 equipment, including support buildings and equip22 ment, that is located within one or more contiguous 

23 or adjacent properties, is under common control of 

24 the same person or persons, and emits or may emit 

25 a greenhouse gas. 


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1 ‘‘(47) STRATEGIC RESERVE ALLOWANCE.—The 

2 term ‘strategic reserve allowance’ means an emission 

3 allowance reserved for, transferred to, or deposited 

4 in the strategic reserve under section 726. 

5 ‘‘(48) TON.—The term ‘ton’ means metric ton. 

6 ‘‘(49) UNCAPPED EMISSIONS.—The term ‘un7 capped emissions’ means emissions of greenhouse 

8 gases emitted after December 31, 2011, that are not 

9 capped emissions. 

10 ‘‘(50) UNITED STATES GREENHOUSE GAS EMIS11 SIONS.—The term ‘United States greenhouse gas 

12 emissions’ means the total quantity of annual green13 house gas emissions from the United States, as cal14 culated by the Administrator and reported to the 

15 United Nations Framework Convention on Climate 

16 Change Secretariat. 

17 ‘‘(51) UTILITY UNIT.—The term ‘utility unit’ 

18 means a combustion device that, on January 1, 

19 2009, or any date thereafter, is fossil fuel-fired and 

20 serves a generator that produces electricity for sale, 

21 unless such combustion device, during the 12-month 

22 period starting the later of January 1, 2009, or the 

23 commencement of commercial operation and each 

24 calendar year starting after such later date— 


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1 ‘‘(A) is part of an integrated cycle system 

2 that cogenerates steam and electricity during 

3 normal operation and that supplies one-third or 

4 less of its potential electric output capacity and 

5 25 MW or less of electrical output for sale; or 

6 ‘‘(B) combusts materials of which more 

7 than 95 percent is municipal solid waste on a 

8 heat input basis. 

9 ‘‘(52) VINTAGE YEAR.—The term ‘vintage year’ 

10 means the calendar year for which an emission al11 lowance is established under section 721(a) or which 

12 is assigned to an emission allowance under section 

13 726(g)(3)(A), except that the vintage year for a 

14 strategic reserve allowance shall be the year in which 

15 such allowance is purchased at auction.’’. 

16 Subtitle B—Disposition of 

17 Allowances 

18 SEC. 321. DISPOSITION OF ALLOWANCES FOR GLOBAL 

19 WARMING POLLUTION REDUCTION PRO20 GRAM. 

21 Title VII of the Clean Air Act, as added by section 

22 311 of this Act, is amended by adding at the end the fol23 lowing part: 


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1 ‘‘PART H—DISPOSITION OF ALLOWANCES 

2 ‘‘SEC. 781. ALLOCATION OF ALLOWANCES FOR SUPPLE3 MENTAL REDUCTIONS. 

4 ‘‘(a) IN GENERAL.—The Administrator shall allocate 

5 for each vintage year the following percentage of the emis6 sion allowances established under section 721(a), for dis7 tribution in accordance with part E: 

8 ‘‘(1) For vintage years 2012 through 2025, 5 

9 percent. 

10 ‘‘(2) For vintage years 2026 through 2030, 3 

11 percent. 

12 ‘‘(3) For vintage years 2031 through 2050, 2 

13 percent. 

14 ‘‘(b) ADJUSTMENT.—The Administrator shall modify 

15 the percentages set forth in subsection (a) as necessary 

16 to ensure the achievement of the annual supplemental 

17 emission reduction objective for 2020, and the cumulative 

18 reduction objective through 2025, set forth in section 

19 753(b)(1). 

20 ‘‘(c) CARRYOVER.—If the Administrator has not dis21 tributed all of the allowances allocated pursuant to this 

22 section for a given vintage year by the end of that year, 

23 all such undistributed emission allowances shall, in accord24 ance with section 782(s), be exchanged for allowances 

25 from the following vintage year and treated as part of the 


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1 allocation for supplemental reductions entities under this 

2 section for that later vintage year. 

3 ‘‘SEC. 782. ALLOCATION OF EMISSION ALLOWANCES. 

4 ‘‘(a) ELECTRICITY CONSUMERS.—(1) The Adminis5 trator shall allocate emission allowances for the benefit of 

6 electricity consumers, to be distributed in accordance with 

7 section 783(b), (c), and (d) in the following amounts: 

8 ‘‘(A) For vintage years 2012 and 2013: 43.75 

9 percent of the emission allowances established for 

10 each year under section 721(a). 

11 ‘‘(B) For vintage years 2014 and 2015: 38.89 

12 percent of the emission allowances established for 

13 each year under section 721(a). 

14 ‘‘(C) For vintage years 2016 through 2025: 

15 35.00 percent of the emission allowances established 

16 for each year under section 721(a). 

17 ‘‘(D) For vintage year 2026: 28 percent of the 

18 emission allowances established for that year under 

19 section 721(a). 

20 ‘‘(E) For vintage year 2027: 21 percent of the 

21 emission allowances established for that year under 

22 section 721(a). 

23 ‘‘(F) For vintage year 2028: 14 percent of the 

24 emission allowances established for that year under 

25 section 721(a). 


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1 ‘‘(G) For vintage year 2029: 7 percent of the 

2 emission allowances established for that year under 

3 section 721(a). 

4 ‘‘(2) The Administrator shall allocate emission allow5 ances for energy efficiency, renewable electricity, and low 

6 income ratepayer assistance programs administered by 

7 small electricity local distribution companies, to be distrib8 uted in accordance with section 783(e) in the following 

9 amounts: 

10 ‘‘(A) For vintage years 2012 through 2025: 0.5 

11 percent of the emission allowances established each 

12 year under section 721(a). 

13 ‘‘(B) For vintage year 2026: 0.4 percent of the 

14 emission allowances established for that year under 

15 section 721(a). 

16 ‘‘(C) For vintage year 2027: 0.3 percent of the 

17 emission allowances established for that year under 

18 section 721(a). 

19 ‘‘(D) For vintage year 2028: 0.2 percent of the 

20 emission allowances established for that year under 

21 section 721(a). 

22 ‘‘(E) For vintage year 2029: 0.1 percent of the 

23 emission allowances established for that year under 

24 section 721(a). 


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1 ‘‘(b) NATURAL GAS CONSUMERS.—The Adminis2 trator shall allocate emission allowances for the benefit of 

3 natural gas consumers to be distributed in accordance 

4 with section 784 in the following amounts: 

5 ‘‘(1) For vintage years 2016 through 2025, 9 

6 percent of the emission allowances established for 

7 each year under section 721(a). 

8 ‘‘(2) For vintage year 2026, 7.2 percent of the 

9 emission allowances established for that year under 

10 section 721(a). 

11 ‘‘(3) For vintage year 2027, 5.4 percent of the 

12 emission allowances established for that year under 

13 section 721(a). 

14 ‘‘(4) For vintage year 2028, 3.6 percent of the 

15 emission allowances established for that year under 

16 section 721(a). 

17 ‘‘(5) For vintage year 2029, 1.8 percent of the 

18 emission allowances established for that year under 

19 section 721(a). 

20 ‘‘(c) HOME HEATING OIL AND PROPANE CON21 SUMERS.—The Administrator shall allocate emission al22 lowances for the benefit of home heating oil and propane 

23 consumers to be distributed in accordance with section 

24 785 in the following amounts: 


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1 ‘‘(1) For vintage years 2012 and 2013, 1.875 

2 percent of the emission allowances established for 

3 each year under section 721(a). 

4 ‘‘(2) For vintage years 2014 and 2015, 1.67 

5 percent of the emission allowances established for 

6 each year under section 721(a). 

7 ‘‘(3) For vintage years 2016 through 2025, 1.5 

8 percent of the emission allowances established for 

9 each year under section 721(a). 

10 ‘‘(4) For vintage year 2026, 1.2 percent of the 

11 emission allowances established for that year under 

12 section 721(a). 

13 ‘‘(5) For vintage year 2027, 0.9 percent of the 

14 emission allowances established for that year under 

15 section 721(a). 

16 ‘‘(6) For vintage year 2028, 0.6 percent of the 

17 emission allowances established for that year under 

18 section 721(a). 

19 ‘‘(7) For vintage year 2029, 0.3 percent of the 

20 emission allowances established for that year under 

21 section 721(a). 

22 ‘‘(d) LOW INCOME CONSUMERS.—For each vintage 

23 year starting in 2012, the Administrator shall auction, 

24 pursuant to section 791, 15 percent of the emission allow25 ances established for each year under section 721(a), with 


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1 the proceeds used for the benefit of low income consumers 

2 to fund the program set forth in subtitle C of title IV of 

3 American Clean Energy and Security Act of 2009 and the 

4 amendments made thereby. 

5 ‘‘(e) TRADE-VULNERABLE INDUSTRIES.— 

6 ‘‘(1) IN GENERAL.—The Administrator shall al7 locate emission allowances to energy-intensive, trade8 exposed entities, to be distributed in accordance with 

9 section 765, in the following amounts: 

10 ‘‘(A) For vintage years 2012 and 2013, up 

11 to 2.0 percent of the emission allowances estab12 lished for each year under section 721(a). 

13 ‘‘(B) For vintage year 2014, up to 15 per14 cent of the emission allowances established for 

15 that year under section 721(a). 

16 ‘‘(C) For vintage year 2015, up to the 

17 product of— 

18 ‘‘(i) the amount specified in para19 graph (2); multiplied by 

20 ‘‘(ii) the quantity of emission allow21 ances established for 2015 under section 

22 721(a) divided by the quantity of emission 

23 allowances established for 2014 under sec24 tion 721(a). 


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1 ‘‘(D) For vintage year 2016, up to the 

2 product of— 

3 ‘‘(i) the amount specified in para4 graph (3); multiplied by 

5 ‘‘(ii) the quantity of emission allow6 ances established for 2015 under section 

7 721(a) divided by the quantity of emission 

8 allowances established for 2014 under sec9 tion 721(a). 

10 ‘‘(E) For vintage years 2017 through 

11 2025, up to the product of— 

12 ‘‘(i) the amount specified in para13 graph (4); multiplied by 

14 ‘‘(ii) the quantity of emission allow15 ances established for that year under sec16 tion 721(a) divided by the quantity of 

17 emission allowances established for 2016 

18 under section 721(a). 

19 ‘‘(F) For vintage years 2026 through 

20 2050, up to the product of the amount specified 

21 in paragraph (4)— 

22 ‘‘(i) multiplied by the quantity of 

23 emission allowances established for the ap24 plicable year during 2026 through 2050 

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1 tity of emission allowances established for 

2 2016 under section 721(a); and 

3 ‘‘(ii) multiplied by a factor that shall 

4 equal 90 percent for 2026 and decline 10 

5 percent for each year thereafter until 

6 reaching zero, except that, if the President 

7 modifies a percentage for a year under 

8 subparagraph (A) of section 767(c)(3), the 

9 highest percentage the President applies 

10 for any sector under that subparagraph for 

11 that year (not exceeding 100 percent) shall 

12 be used for that year instead of the factor 

13 otherwise specified in this clause. 

14 ‘‘(2) CARRYOVER.—After the Administrator dis15 tributes emission allowances pursuant to section 765 

16 for any given vintage year, any emission allowances 

17 allocated to energy-intensive, trade-exposed entities 

18 pursuant to this subsection that have not been so 

19 distributed shall, in accordance with subsection (s), 

20 be exchanged for allowances from the following vin21 tage year and treated as part of the allocation to 

22 such entities for that later vintage year. 

23 ‘‘(f) DEPLOYMENT OF CARBON CAPTURE AND SE24 QUESTRATION TECHNOLOGY.— 


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1 ‘‘(1) ANNUAL ALLOCATION.—The Adminis2 trator shall allocate emission allowances for the de3 ployment of carbon capture and sequestration tech4 nology to be distributed in accordance with section 

5 786 in the following amounts: 

6 ‘‘(A) For vintage years 2014 through 

7 2017, 1.75 percent of the emission allowances 

8 established for each year under section 721(a). 

9 ‘‘(B) For vintage years 2018 and 2019, 

10 4.75 percent of the emission allowances estab11 lished for each year under section 721(a). 

12 ‘‘(C) For vintage years 2020 through 

13 2050, 5 percent of the emission allowances es14 tablished for each year under section 721(a). 

15 ‘‘(2) CARRYOVER.—If the Administrator has 

16 not distributed all of the allowances allocated pursu17 ant to this subsection for a given vintage year by the 

18 end of that year, all such undistributed emission al19 lowances shall, in accordance with subsection (s), be 

20 exchanged for allowances from the following vintage 

21 year and treated as part of the allocation for the de22 ployment of carbon capture and sequestration tech23 nology under this subsection for that later vintage 

24 year. 


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1 ‘‘(g) INVESTMENT IN ENERGY EFFICIENCY AND RE2 NEWABLE ENERGY.—The Administrator shall allocate 

3 emission allowances to invest in energy efficiency and re4 newable energy as follows: 

5 ‘‘(1) To be distributed in accordance with sec6 tion 132 of the American Clean Energy and Security 

7 Act of 2009 in the following amounts: 

8 ‘‘(A) For vintage years 2012 through 

9 2015, 9.5 percent of the emission allowances es10 tablished for each year under section 721(a). 

11 ‘‘(B) For vintage years 2016 through 

12 2017, 6.5 percent of the emission allowances es13 tablished for each year under section 721(a). 

14 ‘‘(C) For vintage years 2018 through 

15 2021, 5.5 percent of the emission allowances es16 tablished for each year under section 721(a). 

17 ‘‘(D) For vintage years 2022 through 

18 2025, 1.0 percent of the emission allowances es19 tablished for each year under section 721(a). 

20 ‘‘(E) For vintage years 2026 through 

21 2050, 4.5 percent of the emission allowances es22 tablished for each year under section 721(a). 

23 ‘‘(F) At the same time allowances are dis24 tributed under subparagraph (D) for each of 

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1 cent of emission allowances established under 

2 section 721(a) for the vintage year four years 

3 after that vintage year shall also be distributed 

4 (which shall be in addition to the emission al5 lowances distributed under subparagraph (E)). 

6 ‘‘(2) To be distributed in accordance with sec7 tion 304 of the Energy Conservation and Production 

8 Act, as amended by section 201 of the American 

9 Clean Energy and Security Act of 2009, for each 

10 vintage year from 2012 through 2050, 0.5 percent 

11 of emission allowances established for that year 

12 under section 721(a). 

13 ‘‘(h) ENERGY RESEARCH AND DEVELOPMENT.— 

14 ‘‘(1) ENERGY INNOVATION HUBS.—For vintage 

15 years 2012 through 2050, the Administrator shall 

16 allocate 0.45 percent of the emission allowances es17 tablished under section 721(a) to be distributed to 

18 Energy Innovation Hubs in accordance with section 

19 171 of the American Clean Energy and Security Act 

20 of 2009. 

21 ‘‘(2) ADVANCED ENERGY RESEARCH.—For vin22 tage years 2012 through 2050, the Administrator 

23 shall allocate 1.05 percent of the emission allowances 

24 established under section 721(a) for the Advanced 

25 Research Project Agency-Energy to be distributed in 


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1 accordance with section 172 of the American Clean 

2 Energy and Security Act of 2009. 

3 ‘‘(i) INVESTMENT IN CLEAN VEHICLE TECH4 NOLOGY.—The Administrator shall allocate emission al5 lowances to invest in the development and deployment of 

6 clean vehicles, to be distributed in accordance with section 

7 124 of the American Clean Energy and Security Act of 

8 2009 in the following amounts: 

9 ‘‘(1) For vintage years 2012 through 2017, 3 

10 percent of the emission allowances established for 

11 each year under section 721(a). 

12 ‘‘(2) For vintage years 2018 through 2025, 1 

13 percent of the emission allowances established for 

14 each year under section 721(a). 

15 ‘‘(j) DOMESTIC FUEL PRODUCTION.—For vintage 

16 years 2014 through 2026, the Administrator shall allocate 

17 and distribute according to section 787— 

18 ‘‘(1) 2 percent of the emission allowances estab19 lished for each year under section 721(a) to domes20 tic petroleum refineries that are covered entities pur21 suant to section 700(13)(F)(viii), including small 

22 business refiners; and 

23 ‘‘(2) an additional 0.25 percent of the emissions 

24 allowances established for each year under section 


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1 721(a) to small business refiners that are covered 

2 entities pursuant to section 700(13)(F)(viii). 

3 ‘‘(k) INVESTMENT IN WORKERS.—The Administrator 

4 shall auction pursuant to section 791 emission allowances 

5 for the benefit of workers pursuant to part 2 of subtitle 

6 B of the American Clean Energy and Security Act of 2009 

7 in the following amounts, and shall deposit into the Cli8 mate Change Worker Adjustment Assistance Fund estab9 lished pursuant to section 793, and report to the Secretary 

10 of Labor on, the proceeds from the sale of these allow11 ances: 

12 ‘‘(1) For vintage years 2012 through 2021, 0.5 

13 percent of the emission allowances established for 

14 each year under section 721(a). 

15 ‘‘(2) For vintage years 2022 through 2050, 1.0 

16 percent of the emission allowances established for 

17 each year under section 721(a). 

18 All amounts deposited into the fund shall be available to 

19 the Secretary of Labor until expended to carry out part 

20 2 of subtitle B of title IV of the American Clean Energy 

21 and Security Act of 2009. Of the amounts deposited, not 

22 more than $10,000,000 shall be available to the Secretary 

23 of Labor for Federal administration costs of such part 2 

24 each fiscal year. 


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1 ‘‘(l) DOMESTIC ADAPTATION.—The Administrator 

2 shall allocate emission allowances for domestic adaptation 

3 as follows: 

4 ‘‘(1) To be distributed in accordance with sec5 tion 453 of the American Clean Energy and Security 

6 Act of 2009 in the following amounts: 

7 ‘‘(A) For vintage years 2012 through 

8 2021, 0.9 percent of the emission allowances es9 tablished for each year under section 721(a). 

10 ‘‘(B) For vintage years 2022 through 

11 2026, 1.9 percent of the emission allowances es12 tablished for each year under section 721(a). 

13 ‘‘(C) For vintage years 2027 through 

14 2050, 3.9 percent of the emission allowances es15 tablished for each year under section 721(a). 

16 ‘‘(2) For vintage year 2012 and thereafter, the 

17 Administrator shall auction, pursuant to section 

18 791, 0.1 percent of the emission allowances estab19 lished for each year under section 721(a), and shall 

20 deposit the proceeds in the Climate Change Health 

21 Protection and Promotion Fund established by sec22 tion 467 of the American Clean Energy and Security 

23 Act of 2009. 

24 ‘‘(m) WILDLIFE AND NATURAL RESOURCE ADAPTA25 TION.—The Administrator shall allocate emission allowVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00716 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ances for wildlife and natural resource adaptation as fol2 lows: 

3 ‘‘(1) To be distributed to State agencies in ac4 cordance with section 480(a) of the American Clean 

5 Energy and Security Act of 2009 in the following 

6 amounts: 

7 ‘‘(A) For vintage years 2012 through 

8 2021, 0.385 percent of the emission allowances 

9 established for each year under section 721(a). 

10 ‘‘(B) For vintage years 2022 through 

11 2026, 0.77 percent of the emission allowances 

12 established for each year under section 721(a). 

13 ‘‘(C) For vintage years 2027 through 

14 2050, 1.54 percent of the emission allowances 

15 established for each year under section 721(a). 

16 ‘‘(2) To be auctioned pursuant to section 791, 

17 with the proceeds to be deposited in the Natural Re18 sources Climate Change Adaptation Fund estab19 lished pursuant to section 480(b), in the following 

20 amounts: 

21 ‘‘(A) For vintage years 2012 through 

22 2021, 0.615 percent of the emission allowances 

23 established for each year under section 721(a). 


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1 ‘‘(B) For vintage years 2022 through 

2 2026, 1.23 percent of the emission allowances 

3 established for each year under section 721(a). 

4 ‘‘(C) For vintage years 2027 through 

5 2050, 2.46 percent of the emission allowances 

6 established for each year under section 721(a). 

7 ‘‘(n) INTERNATIONAL ADAPTATION.—The Adminis8 trator shall allocate emission allowances for international 

9 adaptation to be distributed in accordance with part 2 of 

10 subtitle E of title IV of the American Clean Energy and 

11 Security Act of 2009 in the following amounts: 

12 ‘‘(1) For vintage years 2012 through 2021, 1.0 

13 percent of the emission allowances established for 

14 each year under section 721(a). 

15 ‘‘(2) For vintage years 2022 through 2026, 2.0 

16 percent of the emission allowances established for 

17 each year under section 721(a). 

18 ‘‘(3) For vintage years 2027 through 2050, 4.0 

19 percent of the emission allowances established for 

20 each year under section 721(a). 

21 ‘‘(o) INTERNATIONAL CLEAN TECHNOLOGY DEPLOY22 MENT.—The Administrator shall allocate emission allow23 ances for international clean technology deployment for 

24 distribution in accordance with subtitle D of title IV of 


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•HR 2998 IH

1 the American Clean Energy and Security Act of 2009 in 

2 the following amounts: 

3 ‘‘(1) For vintage years 2012 through 2021, 1.0 

4 percent of the emission allowances established for 

5 each year under section 721(a). 

6 ‘‘(2) For vintage years 2022 through 2026, 2.0 

7 percent of the emission allowances established for 

8 each year under section 721(a). 

9 ‘‘(3) For vintage years 2027 through 2050, 4.0 

10 percent of the emission allowances established for 

11 each year under section 721(a). 

12 ‘‘(p) RELEASE OF FUTURE ALLOWANCES.—The Ad13 ministrator shall make future year allowances available by 

14 auctioning allowances, pursuant to section 791, in the fol15 lowing amounts: 

16 ‘‘(1) In each of calendar years 2014 through 

17 2019, a string of 0.70 billion allowances with vintage 

18 years 12 to 17 years after the year of the auction, 

19 with an equal number of allowances from each vin20 tage year in the string. 

21 ‘‘(2) In each of calendar years 2020 through 

22 2025, a string of 0.50 billion allowances with vintage 

23 years 12 to 17 years after the year of the auction, 

24 with an equal number of allowances from each vin25 tage year in the string. 


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1 ‘‘(3) In each of calendar years 2026 through 

2 2030, a string of 0.3 billion allowances with vintage 

3 years 12 to 17 years after the year of the auction, 

4 with an equal number of allowances from each vin5 tage year in the string. 

6 ‘‘(q) DEFICIT REDUCTION.— 

7 ‘‘(1) For each of vintage years 2012 through 

8 2025, any allowances not allocated for distribution 

9 or auction pursuant to section 781 or subsections 

10 (a) through (o) of this section, or disbursed pursu11 ant to section 790, shall be auctioned by the Admin12 istrator pursuant to section 791 and the proceeds 

13 shall be deposited into the Treasury. 

14 ‘‘(2) Unless otherwise specified, any allowances 

15 allocated pursuant to subsections (a) through (o) 

16 and not distributed by March 31 of the calendar 

17 year following the allowance’s vintage year, shall be 

18 auctioned by the Administrator and the proceeds 

19 shall be deposited into the Treasury. 

20 ‘‘(3) For auctions conducted through calendar 

21 year 2020 pursuant to subsection (p), the auction 

22 proceeds shall be deposited into the Treasury. 

23 ‘‘(r) CLIMATE CHANGE CONSUMER REFUND.— 

24 ‘‘(1) For each of vintage years 2026 through 

25 2050, the Administrator shall auction the following 


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1 allowances established under section 721(a) and de2 posit the proceeds into the Climate Change Con3 sumer Refund Account: 

4 ‘‘(A) Any allowances not allocated for dis5 tribution or auction pursuant to section 781 or 

6 subsections (a) through (p) of this section, or 

7 disbursed pursuant to section 790. 

8 ‘‘(B) Unless otherwise specified, any allow9 ances allocated pursuant to subsections (a) 

10 through (o) and not distributed by March 31 of 

11 the calendar year following the allowance’s vin12 tage year. 

13 ‘‘(2) For auctions conducted pursuant to sub14 section (p) in calendar years 2021 and thereafter, 

15 the Administrator shall place the proceeds from the 

16 sales of the these allowances into the Climate 

17 Change Consumer Refund Account. 

18 ‘‘(3) Funds deposited into the Climate Change 

19 Consumer Refund Account shall be used as specified 

20 in section 789 and shall be available for expenditure, 

21 without further appropriation or fiscal year limita22 tion. 

23 ‘‘(s) TREATMENT OF CARRYOVER ALLOWANCES.— 

24 ‘‘(1) IN GENERAL.—If there are undistributed 

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1 ductions pursuant to section 781(c), energy-inten2 sive, trade-exposed industries pursuant to subsection 

3 (e)(2) of this section, or deployment of carbon cap4 ture and sequestration technology pursuant to sub5 section (f)(2) of this section, the Administrator 

6 shall— 

7 ‘‘(A) use the undistributed allowances to 

8 increase for the same vintage year— 

9 ‘‘(i) the allocation of allowances to be 

10 auctioned for deficit reduction pursuant to 

11 subsection (q) or for consumer refunds 

12 pursuant to subsection (r); 

13 ‘‘(ii) the allocation of allowances to be 

14 auctioned for low income consumers pursu15 ant to subsection (d); or 

16 ‘‘(iii) a combination of both; and 

17 ‘‘(B) except as provided in paragraph 

18 (2)— 

19 ‘‘(i) decrease by the same amount for 

20 the following vintage year the allocation for 

21 the purpose for which the allocation was 

22 increased pursuant to subparagraph (A); 

23 and 

24 ‘‘(ii) increase by the same amount for 

25 the following vintage year the allocation for 


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•HR 2998 IH

1 the purpose for which the undistributed al2 lowances were originally allocated. 

3 ‘‘(2) EXCESS UNDISTRIBUTED ALLOWANCES.— 

4 (A) For each vintage year for which this subsection 

5 applies, the Administrator shall determine wheth6 er— 

7 ‘‘(i) the total quantity of undistributed al8 lowances for that vintage year that were allo9 cated pursuant to section 781(c), and sub10 sections (e)(2) and (f)(2) of this section, ex11 ceeds 

12 ‘‘(ii) the total quantity of allowances allo13 cated pursuant to subsection (d), (q) and (r) 

14 for the following vintage year, decreased by the 

15 quantity of allowances for that following vintage 

16 year set aside for the reserve established by sec17 tion 791(f). 

18 ‘‘(B) If the Administrator determines under 

19 subparagraph (A) that the quantity described in 

20 subparagraph (A)(i) exceeds the quantity described 

21 in subparagraph (A)(ii), paragraph (1)(B)(ii) of this 

22 subsection shall not apply. Instead, for each purpose 

23 described in section 781(c), or subsections (e)(2) or 

24 (f)(2) of this section for which undistributed allow25 ances for a given vintage year were allocated, the 


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•HR 2998 IH

1 Administrator shall increase the allocation for the 

2 following vintage year by the amount that is the 

3 product of— 

4 ‘‘(i) the number of undistributed allow5 ances for that purpose, times 

6 ‘‘(ii) the quantity described in subpara7 graph (A)(ii) divided by the quantity described 

8 in subparagraph (A)(i). 

9 ‘‘SEC. 783. ELECTRICITY CONSUMERS. 

10 ‘‘(a) DEFINITIONS.—For purposes of this section: 

11 ‘‘(1) COAL-FUELED UNIT.—The term ‘coal12 fueled unit’ means a utility unit that derives at least 

13 85 percent of its heat input from coal, petroleum 

14 coke, or any combination of these 2 fuels. 

15 ‘‘(2) ELECTRICITY LOCAL DISTRIBUTION COM16 PANY.—The term ‘electricity local distribution com17 pany’ means an electric utility— 

18 ‘‘(A) that has a legal, regulatory, or con19 tractual obligation to deliver electricity directly 

20 to retail consumers in the United States, re21 gardless of whether that entity or another enti22 ty sells the electricity as a commodity to those 

23 retail consumers; and 


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1 ‘‘(B) the retail rates of which, except in 

2 the case of an electric cooperative, are regulated 

3 or set by— 

4 ‘‘(i) a State regulatory authority; 

5 ‘‘(ii) a State or political subdivision 

6 thereof (or an agency or instrumentality 

7 of, or corporation wholly owned by, either 

8 of the foregoing); or 

9 ‘‘(iii) an Indian tribe pursuant to trib10 al law. 

11 ‘‘(3) ELECTRICITY SAVINGS; RENEWABLE EN12 ERGY RESOURCE.—The terms ‘electricity savings’ 

13 and ‘renewable energy resource’ shall have the 

14 meaning given those terms in section 610 of the 

15 Public Utility Regulatory Policies Act of 1978 (as 

16 added by section 101 of the American Clean Energy 

17 and Security Act of 2009). 

18 ‘‘(4) INDEPENDENT POWER PRODUCTION FA19 CILITY.—The term ‘independent power production 

20 facility’ means a facility— 

21 ‘‘(A) that is used for the generation of 

22 electric energy, at least 80 percent of which is 

23 sold at wholesale; and 


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•HR 2998 IH

1 ‘‘(B) the sales of the output of which are 

2 not subject to retail rate regulation or setting 

3 of retail rates by— 

4 ‘‘(i) a State regulatory authority; 

5 ‘‘(ii) a State or political subdivision 

6 thereof (or an agency or instrumentality 

7 of, or corporation wholly owned by, either 

8 of the foregoing); 

9 ‘‘(iii) an electric cooperative; or 

10 ‘‘(iv) an Indian tribe pursuant to trib11 al law. 

12 ‘‘(5) LONG-TERM CONTRACT GENERATOR.—The 

13 term ‘long-term contract generator’ means a quali14 fying small power production facility, a qualifying 

15 cogeneration facility ), an independent power pro16 duction facility, or a facility for the production of 

17 electric energy for sale to others that is owned and 

18 operated by an electric cooperative that is— 

19 ‘‘(A) a covered entity; and 

20 ‘‘(B) as of the date of enactment of this 

21 title— 

22 ‘‘(i) a facility with 1 or more sales or 

23 tolling agreements executed before March 

24 1, 2007, that govern the facility’s elec25 tricity sales and provide for sales at a price 


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1 (whether a fixed price or a price formula) 

2 for electricity that does not allow for recov3 ery of the costs of compliance with the lim4 itation on greenhouse gas emissions under 

5 this title, provided that such agreements 

6 are not between entities that are affiliates 

7 of one another; or 

8 ‘‘(ii) a facility consisting of 1 or more 

9 cogeneration units that makes useful ther10 mal energy available to an industrial or 

11 commercial process with 1 or more sales 

12 agreements executed before March 1, 

13 2007, that govern the facility’s useful ther14 mal energy sales and provide for sales at 

15 a price (whether a fixed price or price for16 mula) for useful thermal energy that does 

17 not allow for recovery of the costs of com18 pliance with the limitation on greenhouse 

19 gas emissions under this title, provided 

20 that such agreements are not between enti21 ties that are affiliates of one another. 

22 ‘‘(6) MERCHANT COAL UNIT.—The term ‘mer23 chant coal unit’ means a coal-fueled unit that— 

24 ‘‘(A) is or is part of a covered entity; 


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•HR 2998 IH

1 ‘‘(B) is not owned by a Federal, State, or 

2 regional agency or power authority; and 

3 ‘‘(C) generates electricity solely for sale to 

4 others, provided that all or a portion of such 

5 sales are made by a separate legal entity that— 

6 ‘‘(i) has a full or partial ownership or 

7 leasehold interest in the unit, as certified 

8 in accordance with such requirements as 

9 the Administrator shall prescribe; and 

10 ‘‘(ii) is not subject to retail rate regu11 lation or setting of retail rates by— 

12 ‘‘(I) a State regulatory authority; 

13 ‘‘(II) a State or political subdivi14 sion thereof (or an agency or instru15 mentality of, or corporation wholly 

16 owned by, either of the foregoing); 

17 ‘‘(III) an electric cooperative; or 

18 ‘‘(IV) an Indian tribe pursuant 

19 to tribal law. 

20 ‘‘(7) MERCHANT COAL UNIT SALES.—The term 

21 ‘merchant coal unit sales’ means sales to others of 

22 electricity generated by a merchant coal unit that 

23 are made by the owner or leaseholder described in 

24 paragraph (6)(C). 


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1 ‘‘(8) NEW COAL-FUELED UNIT.—The term ‘new 

2 coal-fueled unit’ means a coal-fueled unit that com3 menced operation on or after January 1, 2009 and 

4 before September 30, 2012. 

5 ‘‘(9) NEW MERCHANT COAL UNIT.—The term 

6 ‘new merchant coal unit’ means a merchant coal 

7 unit— 

8 ‘‘(A) that commenced operation on or after 

9 January 1, 2009 and before September 30, 

10 2012; and 

11 ‘‘(B) the actual, on-site construction of 

12 which commenced prior to January 1, 2009. 

13 ‘‘(10) QUALIFYING SMALL POWER PRODUCTION

14 FACILITY; QUALIFYING COGENERATION FACILITY.— 

15 The terms ‘qualifying small power production facil16 ity’ and ‘qualifying cogeneration facility’ have the 

17 meanings given those terms in section 3(17)(C) and 

18 3(18)(B) of the Federal Power Act (16 U.S.C. 

19 796(17)(C) and 796(18)(B)). 

20 ‘‘(11) SMALL LDC.—The term ‘small LDC’ 

21 means, for any given year, an electricity local dis22 tribution company that delivered less than 4,000,000 

23 megawatt hours of electric energy directly to retail 

24 consumers in the preceding year. 


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1 ‘‘(12) STATE REGULATORY AUTHORITY.—The 

2 term ‘State regulatory authority’ has the meaning 

3 given that term in section 3(17) of the Public Utility 

4 Regulatory Policies Act of 1978 (16 U.S.C. 

5 2602(17)). 

6 ‘‘(13) USEFUL THERMAL ENERGY.—The term 

7 ‘useful thermal energy’has the meaning given that 

8 term in section 371(7) of the Energy Policy and 

9 Conservation Act (42 U.S.C. 6341(7)). 

10 ‘‘(b) ELECTRICITY LOCAL DISTRIBUTION COMPA11 NIES.— 

12 ‘‘(1) DISTRIBUTION OF ALLOWANCES.—Not 

13 later than September 30 of 2011 and each calendar 

14 year thereafter through 2028, the Administrator 

15 shall distribute to electricity local distribution com16 panies for the benefit of retail ratepayers the quan17 tity of emission allowances allocated for the fol18 lowing vintage year pursuant to section 782(a)(1). 

19 Notwithstanding the preceding sentence, the Admin20 istrator shall withhold from distribution under this 

21 subsection a quantity of emission allowances equal to 

22 the lesser of 14.3 percent of the quantity of emission 

23 allowances allocated under section 782(a)(1) for the 

24 relevant vintage year, or 105 percent of the emission 

25 allowances for the relevant vintage year that the AdVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00730 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ministrator anticipates will be distributed to mer2 chant coal units and to long-term contract genera3 tors, respectively, under subsections (c) and (d). If 

4 not required by subsections (c) and (d) to distribute 

5 all of these reserved allowances, the Administrator 

6 shall distribute any remaining emission allowances 

7 to electricity local distribution companies in accord8 ance with this subsection. 

9 ‘‘(2) DISTRIBUTION BASED ON EMISSIONS.— 

10 ‘‘(A) IN GENERAL.—For each vintage year, 

11 50 percent of the emission allowances available 

12 for distribution under paragraph (1), after re13 serving allowances for distribution under sub14 sections (c) and (d), shall be distributed by the 

15 Administrator among individual electricity local 

16 distribution companies ratably based on the an17 nual average carbon dioxide emissions attrib18 utable to generation of electricity delivered at 

19 retail by each such company during the base 

20 period determined under subparagraph (B). 

21 ‘‘(B) BASE PERIOD.— 

22 ‘‘(i) VINTAGE YEARS 2012 AND 2013.— 

23 For vintage years 2012 and 2013, an elec24 tricity local distribution company’s base 

25 period shall be— 


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•HR 2998 IH

1 ‘‘(I) calendar years 2006 through 

2 2008; or 

3 ‘‘(II) any 3 consecutive calendar 

4 years between 1999 and 2008, inclu5 sive, that such company selects, pro6 vided that the company timely informs 

7 the Administrator of such selection. 

8 ‘‘(ii) VINTAGE YEARS 2014 AND

9 THEREAFTER.—For vintage years 2014 

10 and thereafter, the base period shall be— 

11 ‘‘(I) the base period selected 

12 under clause (i); or 

13 ‘‘(II) calendar year 2012, in the 

14 case of an electricity local distribution 

15 company that owns, co-owns, or pur16 chases through a power purchase 

17 agreement (whether directly or 

18 through a cooperative arrangement) a 

19 substantial portion of the electricity 

20 generated by a new coal-fueled unit, 

21 provided that such company timely in22 forms the Administrator of its election 

23 to use 2012 as its base period. 

24 ‘‘(C) DETERMINATION OF EMISSIONS.— 


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1 ‘‘(i) DETERMINATION FOR 1999- 

2 2008.—As part of the regulations promul3 gated pursuant to subsection (f), the Ad4 ministrator, after consultation with the 

5 Energy Information Administration, shall 

6 determine the average amount of carbon 

7 dioxide emissions attributable to genera8 tion of electricity delivered at retail by 

9 each electricity local distribution company 

10 for each of the years 1999 through 2008, 

11 taking into account entities’ electricity gen12 eration, electricity purchases, and elec13 tricity sales. In the case of any electricity 

14 local distribution company that owns, co15 owns, or purchases through a power pur16 chase agreement (whether directly or 

17 through a cooperative arrangement) a sub18 stantial portion of the electricity generated 

19 by, a coal-fueled unit that commenced op20 eration after January 1, 2006 and before 

21 December 31, 2008, the Administrator 

22 shall adjust the emissions attributable to 

23 such company’s retail deliveries in calendar 

24 years 2006 through 2008 to reflect the 

25 emissions that would have occurred if the 


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•HR 2998 IH

1 relevant unit were in operation during the 

2 entirety of such 3-year period. 

3 ‘‘(ii) ADJUSTMENTS FOR NEW COAL4 FUELED UNITS.— 

5 ‘‘(I) VINTAGE YEARS 2012 AND

6 2013.—For purposes of emission al7 lowance distributions for vintage years 

8 2012 and 2013, in the case of any 

9 electricity local distribution company 

10 that owns, co-owns, or purchases 

11 through a power purchase agreement 

12 (whether directly or through a cooper13 ative arrangement) a substantial por14 tion of the electricity generated by, a 

15 new coal-fueled unit, the Adminis16 trator shall adjust the emissions at17 tributable to such company’s retail de18 liveries in the applicable base period 

19 to reflect the emissions that would 

20 have occurred if the new coal-fueled 

21 unit were in operation during such pe22 riod. 

23 ‘‘(II) VINTAGE YEAR 2014 AND

24 THEREAFTER.—Not later than nec25 essary for use in making emission alVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00734 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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•HR 2998 IH

1 lowance distributions under this sub2 section for vintage year 2014, the Ad3 ministrator shall, for any electricity 

4 local distribution company that owns, 

5 co-owns, or purchases through a 

6 power purchase agreement (whether 

7 directly or through a cooperative ar8 rangement) a substantial portion of 

9 the electricity generated by a new 

10 coal-fueled unit and has selected cal11 endar year 2012 as its base period 

12 pursuant to subparagraph (B)(ii)(II), 

13 determine the amount of carbon diox14 ide emissions attributable to genera15 tion of electricity delivered at retail by 

16 such company in calendar year 2012. 

17 If the relevant new coal-fueled unit 

18 was not yet operational by January 1, 

19 2012, the Administrator shall adjust 

20 such determination to reflect the 

21 emissions that would have occurred if 

22 such unit were in operation for all of 

23 calendar year 2012. 

24 ‘‘(iii) REQUIREMENTS.—Determina25 tions under this paragraph shall be as preVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00735 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 cise as practicable, taking into account the 

2 nature of data currently available and the 

3 nature of markets and regulation in effect 

4 in various regions of the country. The fol5 lowing requirements shall apply to such de6 terminations: 

7 ‘‘(I) The Administrator shall de8 termine the amount of fossil fuel9 based electricity delivered at retail by 

10 each electricity local distribution com11 pany, and shall use appropriate emis12 sion factors to calculate carbon diox13 ide emissions associated with the gen14 eration of such electricity. 

15 ‘‘(II) Where it is not practical to 

16 determine the precise fuel mix for the 

17 electricity delivered at retail by an in18 dividual electricity local distribution 

19 company, the Administrator may use 

20 the best available data, including aver21 age data on a regional basis with ref22 erence to Regional Transmission Or23 ganizations or regional entities (as 

24 that term is defined in section 

25 215(a)(7) of the Federal Power Act 


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1 (16 U.S.C. 824o(a)(7)), to estimate 

2 fuel mix and emissions. Different 

3 methodologies may be applied in dif4 ferent regions if appropriate to obtain 

5 the most accurate estimate. 

6 ‘‘(3) DISTRIBUTION BASED ON DELIVERIES.— 

7 ‘‘(A) INITIAL FORMULA.—Except as pro8 vided in subparagraph (B), for each vintage 

9 year, the Administrator shall distribute 50 per10 cent of the emission allowances available for 

11 distribution under paragraph (1), after reserv12 ing allowances for distribution under sub13 sections (c) and (d), among individual elec14 tricity local distribution companies ratably 

15 based on each electricity local distribution com16 pany’s annual average retail electricity deliv17 eries for calendar years 2006 through 2008, un18 less the owner or operator of the company se19 lects 3 other consecutive years between 1999 

20 and 2008, inclusive, and timely notifies the Ad21 ministrator of its selection. 

22 ‘‘(B) UPDATING.—Prior to distributing 

23 2015 vintage year emission allowances under 

24 this paragraph and at 3-year intervals there25 after, the Administrator shall update the disVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00737 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tribution formula under this paragraph to re2 flect changes in each electricity local distribu3 tion company’s service territory since the most 

4 recent formula was established. For each suc5 cessive 3-year period, the Administrator shall 

6 distribute allowances ratably among individual 

7 electricity local distribution companies based on 

8 the product of— 

9 ‘‘(i) each electricity local distribution 

10 company’s average annual deliveries per 

11 customer during calendar years 2006 

12 through 2008, or during the 3 alternative 

13 consecutive years selected by such company 

14 under subparagraph (A); and 

15 ‘‘(ii) the number of customers of such 

16 electricity local distribution company in the 

17 most recent year in which the formula is 

18 updated under this subparagraph. 

19 ‘‘(4) PROHIBITION AGAINST EXCESS DISTRIBU20 TIONS.—The regulations promulgated under sub21 section (f) shall ensure that, notwithstanding para22 graphs (2) and (3), no electricity local distribution 

23 company shall receive a greater quantity of allow24 ances under this subsection than is necessary to off25 set any increased electricity costs to such company’s 


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1 retail ratepayers, including increased costs attrib2 utable to purchased power costs, due to enactment 

3 of this title. Any emission allowances withheld from 

4 distribution to an electricity local distribution com5 pany pursuant to this paragraph shall be distributed 

6 among all remaining electricity local distribution 

7 companies ratably based on emissions pursuant to 

8 paragraph (2). 

9 ‘‘(5) USE OF ALLOWANCES.— 

10 ‘‘(A) RATEPAYER BENEFIT.—Emission al11 lowances distributed to an electricity local dis12 tribution company under this subsection shall 

13 be used exclusively for the benefit of retail rate14 payers of such electricity local distribution com15 pany and may not be used to support electricity 

16 sales or deliveries to entities or persons other 

17 than such ratepayers. 

18 ‘‘(B) RATEPAYER CLASSES.—In using 

19 emission allowances distributed under this sub20 section for the benefit of ratepayers, an elec21 tricity local distribution company shall ensure 

22 that ratepayer benefits are distributed— 

23 ‘‘(i) among ratepayer classes ratably 

24 based on electricity deliveries to each class; 

25 and 


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1 ‘‘(ii) equitably among individual rate2 payers within each ratepayer class, includ3 ing entities that receive emission allow4 ances pursuant to part F. 

5 ‘‘(C) LIMITATION.—In general, an elec6 tricity local distribution company shall not use 

7 the value of emission allowances distributed 

8 under this subsection to provide to any rate9 payer a rebate that is based solely on the quan10 tity of electricity delivered to such ratepayer. 

11 To the extent an electricity local distribution 

12 company uses the value of emission allowances 

13 distributed under this subsection to provide re14 bates, it shall, to the maximum extent prac15 ticable, provide such rebates with regard to the 

16 fixed portion of ratepayers’ bills or as a fixed 

17 credit or rebate on electricity bills. 

18 ‘‘(D) INDUSTRIAL RATEPAYERS.—Notwith19 standing subparagraph (C), if compliance with 

20 the requirements of this title results (or would 

21 otherwise result) in an increase in electricity 

22 costs for industrial retail ratepayers of any 

23 given electricity local distribution company (in24 cluding entities that receive emission allowances 


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1 pursuant to part F), such electricity local dis2 tribution company— 

3 ‘‘(i) shall pass through to industrial 

4 retail ratepayers their ratable share (based 

5 on deliveries to each ratepayer class) of the 

6 value of the emission allowances distrib7 uted to such company under this sub8 section, to reduce electricity cost impacts 

9 on such ratepayers; and 

10 ‘‘(ii) may do so based on the quantity 

11 of electricity delivered to individual indus12 trial retail ratepayers. 

13 ‘‘(E) GUIDELINES.—As part of the regula14 tions promulgated under subsection (f), the Ad15 ministrator shall, after consultation with State 

16 regulatory authorities, prescribe guidelines for 

17 the implementation of the requirements of this 

18 paragraph. Such guidelines shall include re19 quirements to ensure that industrial retail rate20 payers (including entities that receive emission 

21 allowances under part F) receive their ratable 

22 share of the value of the allowances distributed 

23 to each electricity local distribution company 

24 pursuant to this subsection. 

25 ‘‘(6) REGULATORY PROCEEDINGS.— 


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1 ‘‘(A) REQUIREMENT.—No electricity local 

2 distribution company shall be eligible to receive 

3 emission allowances under this subsection or 

4 subsection (e) unless the State regulatory au5 thority with authority over such company’s re6 tail rates, or the entity with authority to regu7 late or set retail electricity rates of an elec8 tricity local distribution company not regulated 

9 by a State regulatory authority, has— 

10 ‘‘(i) after public notice and an oppor11 tunity for comment, promulgated a regula12 tion or completed a rate proceeding (or the 

13 equivalent, in the case of a ratemaking en14 tity other than a State regulatory author15 ity) that provides for the full implementa16 tion of the requirements of paragraph (5) 

17 of this subsection and the requirements of 

18 subsection (e); and 

19 ‘‘(ii) made available to the Adminis20 trator and the public a report describing, 

21 in adequate detail, the manner in which 

22 the requirements of paragraph (5) and the 

23 requirements of subsection (e) will be im24 plemented. 


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1 ‘‘(B) UPDATING.—The Administrator shall 

2 require, as a condition of continued receipt of 

3 emission allowances under this subsection by an 

4 electricity local distribution company, that a 

5 new regulation be promulgated or rate pro6 ceeding be completed , after public notice and 

7 an opportunity for comment, and a new report 

8 be made available to the Administrator and the 

9 public, pursuant to subparagraph (A), not less 

10 frequently than every 5 years. 

11 ‘‘(7) PLANS AND REPORTING.— 

12 ‘‘(A) REGULATIONS.—As part of the regu13 lations promulgated under subsection (f), the 

14 Administrator shall prescribe requirements gov15 erning plans and reports to be submitted in ac16 cordance with this paragraph. 

17 ‘‘(B) PLANS.—Not later than April 30 of 

18 2011 and every 5 years thereafter through 

19 2026, each electricity local distribution com20 pany shall submit to the Administrator a plan, 

21 approved by the State regulatory authority or 

22 other entity charged with regulating tor setting 

23 the retail rates of such company, describing 

24 such company’s plans for the disposition of the 

25 value of emission allowances to be received purVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00743 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 suant to this subsection and subsection (e), in 

2 accordance with the requirements of this sub3 section and subsection (e). Such plan shall in4 clude a description of the manner in which the 

5 company will provide to industrial retail rate6 payers (including entities that receive emission 

7 allowances under part F) their ratable share of 

8 the value of such allowances. 

9 ‘‘(C) REPORTS.—Not later than June 30 

10 of 2013 and each calendar year thereafter 

11 through 2031, each electricity local distribution 

12 company shall submit a report to the Adminis13 trator, and to the relevant State regulatory au14 thority or other entity charged with regulating 

15 or setting the retail electricity rates of such 

16 company, describing the disposition of the value 

17 of any emission allowances received by such 

18 company in the prior calendar year pursuant to 

19 this subsection and subsection (e), including— 

20 ‘‘(i) a description of sales, transfer, 

21 exchange, or use by the company for com22 pliance with obligations under this title, of 

23 any such emission allowances; 

24 ‘‘(ii) the monetary value received by 

25 the company, whether in money or in some 


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1 other form, from the sale, transfer, or ex2 change of any such emission allowances; 

3 ‘‘(iii) the manner in which the com4 pany’s disposition of any such emission al5 lowances complies with the requirements of 

6 this subsection and of subsection (e), in7 cluding each of the requirements of para8 graph (5) of this subsection, including the 

9 requirement that industrial retail rate10 payers (including entities that receive 

11 emission allowances under part F) receive 

12 their ratable share of the value of such al13 lowances; and 

14 ‘‘(iv) such other information as the 

15 Administrator may require pursuant to 

16 subparagraph (A). 

17 ‘‘(D) PUBLICATION.—The Administrator 

18 shall make available to the public all plans and 

19 reports submitted under this subsection, includ20 ing by publishing such plans and reports on the 

21 Internet. 

22 ‘‘(8) AUDITS.—Each year, the Administrator 

23 shall audit a representative sample of electricity local 

24 distribution companies to ensure that emission al25 lowances distributed under this subsection have been 


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1 used exclusively for the benefit of retail ratepayers 

2 and that such companies are complying with the re3 quirements of this subsection and of subsection (e), 

4 including the requirement that industrial retail rate5 payers (including entities that receive emission al6 lowances under part F) receive their ratable share of 

7 the value of such allowances. In selecting companies 

8 for audit, the Administrator shall take into account 

9 any credible evidence of noncompliance with such re10 quirements. The Administrator shall make available 

11 to the public a report describing the results of each 

12 such audit, including by publishing such report on 

13 the Internet. 

14 ‘‘(9) ENFORCEMENT.—A violation of any re15 quirement of this subsection or of subsection (e) 

16 shall be a violation of this Act. Each emission allow17 ance the value of which is used in violation of the 

18 requirements of this subsection or of subsection (e) 

19 shall be a separate violation. 

20 ‘‘(c) MERCHANT COAL UNITS.— 

21 ‘‘(1) QUALIFYING EMISSIONS.—The qualifying 

22 emissions for a merchant coal unit for a given cal23 endar year shall be the product of the number of 

24 megawatt hours of merchant coal unit sales gen25 erated by such unit in such calendar year and the 


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1 average carbon dioxide emissions per megawatt hour 

2 generated by such unit during the base period under 

3 paragraph (2), provided that the number of mega4 watt hours in a given calendar year for purposes of 

5 such calculation shall be reduced in proportion to 

6 the portion of such unit’s carbon dioxide emissions 

7 that are either— 

8 ‘‘(A) captured and sequestered in such cal9 endar year; or 

10 ‘‘(B) attributable to the combustion or gas11 ification of biomass, to the extent that the 

12 owner or operator of the unit is not required to 

13 hold emission allowances for such emissions. 

14 ‘‘(2) BASE PERIOD.—For purposes of this sub15 section, the base period for a merchant coal unit 

16 shall be— 

17 ‘‘(A) calendar years 2006 through 2008; or 

18 ‘‘(B) in the case of a new merchant coal 

19 unit— 

20 ‘‘(i) the first full calendar year of op21 eration of such unit, provided that such 

22 year shall not be any year after calendar 

23 year 2012; or 


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1 ‘‘(ii) calendar year 2012, if such unit 

2 commences operation on or after January 

3 1, 2012. 

4 ‘‘(3) PHASE-DOWN SCHEDULE.—The Adminis5 trator shall identify an annual phase-down factor, 

6 applicable to distributions to merchant coal units for 

7 each of vintage years 2012 through 2029, that cor8 responds to the overall decline in the amount of 

9 emission allowances allocated to the electricity sector 

10 in such years pursuant to section 782(a)(1). Such 

11 factor shall— 

12 ‘‘(A) for vintage year 2012, be equal to 

13 1.0; 

14 ‘‘(B) for each of vintage years 2013 

15 through 2029, correspond to the quotient of— 

16 ‘‘(i) the quantity of emission allow17 ances allocated under section 782(a)(1) for 

18 such vintage year; divided by 

19 ‘‘(ii) the quantity of emission allow20 ances allocated under section 782(a)(1) for 

21 vintage year 2012. 

22 ‘‘(4) DISTRIBUTION OF EMISSION ALLOW23 ANCES.—Not later than March 1 of 2013 and each 

24 calendar year through 2030, the Administrator shall 

25 distribute emission allowances of the preceding vinVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00748 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tage year to the owner or operator of each merchant 

2 coal unit described in subsection (a)(6)(C) in an 

3 amount equal to the product of— 

4 ‘‘(A) 0.5; 

5 ‘‘(B) the qualifying emissions for such 

6 merchant coal unit for the preceding year, as 

7 determined under paragraph (1); and 

8 ‘‘(C) the phase-down factor for the pre9 ceding calendar year, as identified under para10 graph (3). 

11 ‘‘(5) ADJUSTMENT.— 

12 ‘‘(A) STUDY.—Not later than July 1, 

13 2014, the Administrator, in consultation with 

14 the Federal Energy Regulatory Commission, 

15 shall complete a study to determine whether the 

16 allocation formula under paragraph (3) is re17 sulting in, or is likely to result in, windfall prof18 its to merchant coal generators or substantially 

19 disparate treatment of merchant coal genera20 tors operating in different markets or regions. 

21 ‘‘(B) REGULATION.—If the Administrator, 

22 in consultation with the Federal Energy Regu23 latory Commission, makes an affirmative find24 ing of windfall profits or disparate treatment 

25 under subparagraph (A), the Administrator 


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1 shall, not later than 18 months after the com2 pletion of the study described in subparagraph 

3 (A), promulgate regulations providing for the 

4 adjustment of the allocation formula under 

5 paragraph (3) to mitigate, to the extent prac6 ticable, such windfall profits, if any, and such 

7 disparate treatment, if any. 

8 ‘‘(6) LIMITATION ON ALLOWANCES.—Notwith9 standing paragraph (4) or (5), for each vintage year 

10 the Administrator shall distribute under this sub11 section no more than 10 percent of the total quan12 tity of emission allowances available for such vintage 

13 year for distribution to the electricity sector under 

14 section 782(a)(1). If the quantity of emission allow15 ances that would otherwise be distributed pursuant 

16 to paragraph (4) or (5) for any vintage year would 

17 exceed such limit, the Administrator shall distribute 

18 10 percent of the total emission allowances available 

19 for distribution under section 782(a)(1) for such vin20 tage year ratably among merchant coal generators 

21 based on the applicable formula under paragraph (4) 

22 or (5). 

23 ‘‘(7) ELIGIBILITY.—The owner or operator of a 

24 merchant coal unit shall not be eligible to receive 

25 emission allowances under this subsection for any 


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1 vintage year for which such owner or operator has 

2 elected to receive emission allowances for the same 

3 unit under subsection (d). 

4 ‘‘(d) LONG-TERM CONTRACT GENERATORS.— 

5 ‘‘(1) DISTRIBUTION.—Not later than March 1 

6 of 2013 and each calendar year through 2030, the 

7 Administrator shall distribute to the owner or oper8 ator of each long-term contract generator a quantity 

9 of emission allowances of the preceding vintage year 

10 that is equal to the sum of— 

11 ‘‘(A) the number of tons of carbon dioxide 

12 emitted as a result of a qualifying electricity 

13 sales agreement referred to in subsection 

14 (a)(5)(B)(i); and 

15 ‘‘(B) the incremental number of tons of 

16 carbon dioxide emitted solely as a result of a 

17 qualifying thermal sales agreement referred to 

18 in subsection (a)(5)(B)(ii), provided that in no 

19 event shall the Administrator distribute more 

20 than 1 emission allowance for the same ton of 

21 emissions. 

22 ‘‘(2) LIMITATION ON ALLOWANCES.— Notwith23 standing paragraph (1), for each vintage year the 

24 Administrator shall distribute under this subsection 

25 no more than 4.3 percent of the total quantity of 


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1 emission allowances available for such vintage year 

2 for distribution to the electricity sector under section 

3 782(a)(1). If the quantity of emission allowances 

4 that would otherwise be distributed pursuant to 

5 paragraph (1) for any vintage year would exceed 

6 such limit, the Administrator shall distribute 4.3 

7 percent of the total emission allowances available for 

8 distribution under section 782(a)(1) for such vintage 

9 year ratably among long-term contract generators 

10 based on paragraph (1). 

11 ‘‘(3) ELIGIBILITY.— 

12 ‘‘(A) FACILITY ELIGIBILITY.—The owner 

13 or operator of a facility shall cease to be eligible 

14 to receive emission allowances under this sub15 section upon the earliest date on which the fa16 cility no longer meets each and every element of 

17 the definition of a long-term contract generator 

18 under subsection (a)(5). 

19 ‘‘(B) CONTRACT ELIGIBILITY.—The owner 

20 or operator of a facility shall cease to be eligible 

21 to receive emission allowances under this sub22 section based on an electricity or thermal sales 

23 agreement referred to in subsection (a)(5)(B) 

24 upon the earliest date that such agreement— 

25 ‘‘(i) expires; 


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1 ‘‘(ii) is terminated; or 

2 ‘‘(iii) is amended in any way that 

3 changes the location of the facility, the 

4 price (whether a fixed price or price for5 mula) for electricity or thermal energy sold 

6 under such agreement, the quantity of 

7 electricity or thermal energy sold under the 

8 agreement, or the expiration or termi9 nation date of the agreement. 

10 ‘‘(4) DEMONSTRATION OF ELIGIBILITY.—To be 

11 eligible to receive allowance distributions under this 

12 subsection, the owner or operator of a long-term 

13 contract generator shall submit each of the following 

14 in writing to the Administrator within 180 days 

15 after the date of enactment of this title, and not 

16 later than September 30 of each vintage year for 

17 which such generator wishes to receive emission al18 lowances: 

19 ‘‘(A) A certificate of representation de20 scribed in section 700(15). 

21 ‘‘(B) An identification of each owner and 

22 each operator of the facility. 

23 ‘‘(C) An identification of the units at the 

24 facility and the location of the facility. 


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1 ‘‘(D) A written certification by the des2 ignated representative that the facility meets all 

3 the requirements of the definition of a long4 term contract generator. 

5 ‘‘(E) The expiration date of each quali6 fying electricity or thermal sales agreement re7 ferred to in subsection (a)(5)(B). 

8 ‘‘(F) A copy of each qualifying electricity 

9 or thermal sales agreement referred to in sub10 section (a)(5)(B). 

11 ‘‘(5) NOTIFICATION.—Not later than 30 days 

12 after, in accordance with paragraph (3), a facility or 

13 an agreement ceases to meet the eligibility require14 ments for distribution of emission allowances pursu15 ant to this subsection, the designated representative 

16 of such facility shall notify the Administrator in 

17 writing when, and on what basis, such facility or 

18 agreement ceased to meet such requirements. 

19 ‘‘(e) SMALL LDCS.— 

20 ‘‘(1) DISTRIBUTION.—Not later than Sep21 tember 30 of each calendar year from 2011 through 

22 2028, the Administrator shall, in accordance with 

23 this subsection, distribute emission allowances allo24 cated pursuant to section 782(a)(2) for the following 

25 vintage year. Such allowances shall be distributed 


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1 ratably among small LDCs based on historic emis2 sions in accordance with the same measure of such 

3 emissions applied to each such small LDC for the 

4 relevant vintage year under subsection (b)(2) of this 

5 section. 

6 ‘‘(2) USES.—A small LDC receiving allowances 

7 under this section shall use such allowances exclu8 sively for the following purposes: 

9 ‘‘(A) Cost-effective programs to achieve 

10 electricity savings, provided that such savings 

11 shall not be transferred or used for compliance 

12 with section 610 of the Public Utility Regu13 latory Policies Act of 1978. 

14 ‘‘(B) Deployment of technologies to gen15 erate electricity from renewable energy re16 sources, provided that any Federal renewable 

17 electricity credits issued based on generation 

18 supported under this section shall be submitted 

19 to the Federal Energy Regulatory Commission 

20 for voluntary retirement and shall not be used 

21 for compliance with section 610 of the Public 

22 Utility Regulatory Policies Act of 1978. 

23 ‘‘(C) Assistance programs to reduce elec24 tricity costs for low-income residential rate25 payers of such small LDC, provided that such 


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1 assistance is made available equitably to all res2 idential ratepayers below a certain income level, 

3 which shall not be higher than 200 percent of 

4 the poverty line (as that term is defined in sec5 tion 673(2) of the Community Services Block 

6 Grant Act (42 U.S.C. 9902(2)). 

7 ‘‘(3) REQUIREMENTS.—As part of the regula8 tions promulgated under subsection (f), the Adminis9 trator shall prescribe— 

10 ‘‘(A) after consultation with the Federal 

11 Energy Regulatory Commission, requirements 

12 to ensure that programs and projects under 

13 paragraph (2)(A) and (B) are consistent with 

14 the standards established by, and effectively 

15 supplement electricity savings and generation of 

16 electricity from renewable energy resources 

17 achieved by, the Combined Efficiency and Re18 newable Electricity Standard established under 

19 section 610 of the Public Utility Regulatory 

20 Policies Act of 1978; 

21 ‘‘(B) eligibility criteria and guidelines for 

22 consumer assistance programs for low-income 

23 residential ratepayers under paragraph (2)(C); 

24 and 


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1 ‘‘(C) such other requirements as the Ad2 ministrator determines appropriate to ensure 

3 compliance with the requirements of this sub4 section. 

5 ‘‘(4) REPORTING.—Reports submitted under 

6 subsection (b)(7) shall include, in accordance with 

7 such requirements as the Administrator may pre8 scribe— 

9 ‘‘(A) a description of any facilities de10 ployed under paragraph (2)(A), the quantity of 

11 resulting electricity generation from renewable 

12 energy resources; 

13 ‘‘(B) an assessment demonstrating the 

14 cost-effectiveness of, and electricity savings 

15 achieved by, programs supported under para16 graph (2)(B); and 

17 ‘‘(C) a description of assistance provided to 

18 low-income retail ratepayers under paragraph 

19 (2)(C). 

20 ‘‘(f) REGULATIONS.—Not later than 2 years after the 

21 date of enactment of this title, the Administrator, in con22 sultation with the Federal Energy Regulatory Commis23 sion, shall promulgate regulations to implement the re24 quirements of this section. 


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1 ‘‘SEC. 784. NATURAL GAS CONSUMERS. 

2 ‘‘(a) DEFINITIONS.—For purposes of this section: 

3 ‘‘(1) COST-EFFECTIVE.—The term ‘cost-effec4 tive’, with respect to an energy efficiency program, 

5 means that the program meets the Total Resource 

6 Cost Test, which requires that the net present value 

7 of economic benefits over the life of the program, in8 cluding avoided supply and delivery costs and de9 ferred or avoided investments, is greater than the 

10 net present value of the economic costs over the life 

11 of the program, including program costs and incre12 mental costs borne by the energy consumer. 

13 ‘‘(2) NATURAL GAS LOCAL DISTRIBUTION COM14 PANY.—The term ‘natural gas local distribution 

15 company’ means a natural gas local distribution 

16 company that is a covered entity. 

17 ‘‘(3) NON-COVERED ENTITY.—The term ‘non18 covered entity’ means, when used in reference to a 

19 date or period prior to the enactment of this title, 

20 an entity that would not have been a covered entity 

21 if this title had been in effect during such date or 

22 period. 

23 ‘‘(4) STATE REGULATORY AUTHORITY.—The 

24 term ‘State regulatory authority’ has the meaning 

25 given the term ‘State commission’ in section 2(8) of 

26 the Natural Gas Act (15 U.S.C. 717a(8)). 


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1 ‘‘(b) DISTRIBUTION.—Not later than June 30 of 

2 2015 and each calendar year thereafter through 2028, the 

3 Administrator shall distribute to natural gas local dis4 tribution companies for the benefit of retail ratepayers the 

5 quantity of emission allowances allocated for the following 

6 vintage year pursuant to section 782(b). Such allowances 

7 shall be distributed among local natural gas distribution 

8 companies based on the following formula: 

9 ‘‘(1) INITIAL FORMULA.—Except as provided in 

10 paragraph (2), for each vintage year, the Adminis11 trator shall distribute emission allowances among 

12 natural gas local distribution companies ratably 

13 based on each such company’s annual average retail 

14 natural gas deliveries for 2006 through 2008 to cus15 tomers that were non-covered entities, unless the 

16 owner or operator of the company selects 3 other 

17 consecutive years between 1999 and 2008, inclusive, 

18 and timely notifies the Administrator of its selection. 

19 ‘‘(2) UPDATING.—Prior to distributing 2019 

20 vintage year emission allowances and at 3-year inter21 vals thereafter, the Administrator shall update the 

22 distribution formula under this subsection to reflect 

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1 riod, the Administrator shall distribute allowances 

2 ratably among natural gas local distribution compa3 nies based on the product of— 

4 ‘‘(A) each natural gas local distribution 

5 company’s average annual natural gas deliveries 

6 per customer to customers that were non-cov7 ered entities during calendar years 2006 

8 through 2008, or during the 3 alternative con9 secutive years selected by such company under 

10 paragraph (1); and 

11 ‘‘(B) the number of customers of such nat12 ural gas local distribution company that are not 

13 covered entities in the most recent year in 

14 which the formula is updated under this para15 graph. 

16 ‘‘(c) USE OF ALLOWANCES.— 

17 ‘‘(1) RATEPAYER BENEFIT.—Emission allow18 ances distributed to a natural gas local distribution 

19 company under this section shall be used exclusively 

20 for the benefit of retail ratepayers of such natural 

21 gas local distribution company other than covered 

22 entities and may not be used to support natural gas 

23 sales or deliveries to entities or persons other than 

24 such ratepayers. 


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1 ‘‘(2) RATEPAYER CLASSES.—In using emission 

2 allowances distributed under this section for the ben3 efit of ratepayers, a natural gas local distribution 

4 company shall ensure that ratepayer benefits are 

5 distributed— 

6 ‘‘(A) among ratepayer classes ratably 

7 based on natural gas deliveries to each class, 

8 excluding deliveries to covered entities; and 

9 ‘‘(B) equitably among individual ratepayers 

10 other than covered entities within each rate11 payer class. 

12 ‘‘(3) LIMITATION.—In general, a natural gas 

13 local distribution company shall not use the value of 

14 emission allowances distributed under this section to 

15 provide to any ratepayer a rebate that is based solely 

16 on the quantity of natural gas delivered to such 

17 ratepayer. To the extent a natural gas local distribu18 tion company uses the value of emission allowances 

19 distributed under this section to provide rebates, it 

20 shall, to the maximum extent practicable, provide 

21 such rebates with regard to the fixed portion of rate22 payers’ bills or as a fixed creditor rebate on natural 

23 gas bills. 

24 ‘‘(4) INDUSTRIAL RATEPAYERS.—Notwith25 standing paragraph (3), if compliance with the reVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00761 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 quirements of this title results (or would otherwise 

2 result) in an increase in natural gas costs for indus3 trial retail ratepayers of any given natural gas local 

4 distribution company that are not covered entities 

5 (including entities that receive emission allowances 

6 pursuant to part F), such natural gas local distribu7 tion company— 

8 ‘‘(A) shall pass through to industrial retail 

9 ratepayers that are not covered entities their 

10 ratable share (based on deliveries to each rate11 payer class) of the value of the emission allow12 ances distributed to such company under this 

13 subsection, to reduce natural gas cost impacts 

14 on such ratepayers; and 

15 ‘‘(B) may do so based on the quantity of 

16 natural gas delivered to individual industrial re17 tail ratepayers. 

18 ‘‘(5) ENERGY EFFICIENCY PROGRAMS.—The 

19 value of no less than one third of the emission allow20 ances distributed to natural gas local distribution 

21 companies pursuant to this section in any calendar 

22 year shall be used for cost-effective energy efficiency 

23 programs for natural gas consumers. Such programs 

24 must be authorized and overseen by the State regu25 latory authority, or by the entity with authority to 


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1 regulate or set retail natural gas rates in the case 

2 of a natural gas local distribution company that is 

3 not regulated by a State regulatory authority. 

4 ‘‘(6) CERTAIN INTRACOMPANY DELIVERIES.—If 

5 a natural gas local distribution company makes an 

6 intracompany delivery of natural gas to a customer 

7 that is not a covered entity, for which such company 

8 is required to hold emission allowances under section 

9 722, such customer shall, for purposes of this sec10 tion, be considered a retail ratepayer and a member 

11 of a ratepayer class to be determined by the relevant 

12 State regulatory authority, or other entity with au13 thority to regulate or set natural gas rates in the 

14 case of a company not regulated by a State regu15 latory authority. 

16 ‘‘(7) GUIDELINES.—As part of the regulations 

17 promulgated under subsection (h), the Administrator 

18 shall, after consultation with State regulatory au19 thorities, prescribe guidelines for the implementation 

20 of the requirements of this subsection. Such guide21 lines shall include requirements to ensure that in22 dustrial retail ratepayers that are not covered enti23 ties (including entities that receive emission allow24 ances under part F) receive their ratable share of 

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1 ural gas local distribution company pursuant to this 

2 section. 

3 ‘‘(d) REGULATORY PROCEEDINGS.— 

4 ‘‘(1) REQUIREMENT.—No natural gas local dis5 tribution company shall be eligible to receive emis6 sion allowances under this section unless the State 

7 regulatory authority with authority over the retail 

8 rates of such company, or the entity with authority 

9 to regulate or set retail rates of a natural gas local 

10 distribution company not regulated by a State regu11 latory authority, has— 

12 ‘‘(A) after public notice and an opportunity 

13 for comment, promulgated a regulation or com14 pleted a public rate proceeding (or the equiva15 lent, in the case of a ratemaking entity other 

16 than a State regulatory authority) that provides 

17 for the full implementation of the requirements 

18 of subsection (c); and 

19 ‘‘(B) made available to the Administrator 

20 and the public a report describing, in adequate 

21 detail, the manner in which the requirements of 

22 subsection (c) will be implemented. 

23 ‘‘(2) UPDATING.—The Administrator shall re24 quire, as a condition of continued receipt of emission 

25 allowances under this section, that a new regulation 


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1 be promulgated or rate proceeding be completed, 

2 after public notice and an opportunity for comment, 

3 and a new report be made available to the Adminis4 trator and the public, pursuant to paragraph (1), 

5 not less frequently than every 5 years. 

6 ‘‘(e) PLANS AND REPORTING.— 

7 ‘‘(1) REGULATIONS.—As part of the regulations 

8 promulgated under subsection (h), the Administrator 

9 shall prescribe requirements governing plans and re10 ports to be submitted in accordance with this sub11 section. 

12 ‘‘(2) PLANS.—Not later than April 30 of 2015 

13 and every 5 years thereafter through 2025, each 

14 natural gas local distribution company shall submit 

15 to the Administrator a plan, approved by the State 

16 regulatory authority or other entity charged with 

17 regulating or setting the retail rates of such com18 pany, describing such company’s plans for the dis19 position of the value of emission allowances to be re20 ceived pursuant to this section, in accordance with 

21 the requirements of this section. 

22 ‘‘(3) REPORTS.—Not later than June 30 of 

23 2017 and each calendar year thereafter through 

24 2031, each natural gas local distribution company 

25 shall submit a report to the Administrator, approved 


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1 by the relevant State regulatory authority or other 

2 entity charged with regulating or setting the retail 

3 natural gas rates of such company, describing the 

4 disposition of the value of any emission allowances 

5 received by such company in the prior calendar year 

6 pursuant to this section, including— 

7 ‘‘(A) a description of sales, transfer, ex8 change, or use by the company for compliance 

9 with obligations under this title, of any such 

10 emission allowances; 

11 ‘‘(B) the monetary value received by the 

12 company, whether in money or in some other 

13 form, from the sale, transfer, or exchange of 

14 emission allowances received by the company 

15 under this section; 

16 ‘‘(C) the manner in which the company’s 

17 disposition of emission allowances received 

18 under this section complies with the require19 ments of this section, including each of the re20 quirements of subsection (c); 

21 ‘‘(D) the cost-effectiveness of, and energy 

22 savings achieved by, energy efficiency programs 

23 supported through such emission allowances; 

24 and 


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1 ‘‘(E) such other information as the Admin2 istrator may require pursuant to paragraph (1). 

3 ‘‘(4) PUBLICATION.—The Administrator shall 

4 make available to the public all plans and reports 

5 submitted by natural gas local distribution compa6 nies under this subsection, including by publishing 

7 such plans and reports on the Internet. 

8 ‘‘(f) AUDITS.—Each year, the Administrator shall 

9 audit a representative sample of natural gas local distribu10 tion companies to ensure that emission allowances distrib11 uted under this section have been used exclusively for the 

12 benefit of retail ratepayers and that such companies are 

13 complying with the requirements of this section. In select14 ing companies for audit, the Administrator shall take into 

15 account any credible evidence of noncompliance with such 

16 requirements. The Administrator shall make available to 

17 the public a report describing the results of each such 

18 audit, including by publishing such report on the Internet. 

19 ‘‘(g) ENFORCEMENT.—A violation of any require20 ment of this section shall be a violation of this Act. Each 

21 emission allowance the value of which is used in violation 

22 of the requirements of this section shall be a separate vio23 lation. 

24 ‘‘(h) REGULATIONS.—Not later than January 1, 

25 2014, the Administrator, in consultation with the Federal 


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1 Energy Regulatory Commission, shall promulgate regula2 tions to implement the requirements of this section. 

3 ‘‘SEC. 785. HOME HEATING OIL, PROPANE, AND KEROSENE 

4 CONSUMERS. 

5 ‘‘(a) DEFINITIONS.—For purposes of this section: 

6 ‘‘(1) CARBON CONTENT.—The term ‘carbon 

7 content’ means the amount of carbon dioxide that 

8 would be emitted as a result of the combustion of a 

9 fuel. 

10 ‘‘(2) COST-EFFECTIVE.—The term ‘cost-effec11 tive’ has the meaning given that term in section 

12 784(a)(1). 

13 ‘‘(3) OILHEAT FUEL.—The term ‘oilheat fuel’ 

14 means fuel that— 

15 ‘‘(A) is— 

16 ‘‘(i) No. 1 distillate; 

17 ‘‘(ii) No. 2 dyed distillate; 

18 ‘‘(iii) a liquid blended with No. 1 dis19 tillate or No. 2 dyed distillate; or 

20 ‘‘(iv) a biobased liquid; and 

21 ‘‘(B) is used as a fuel for nonindustrial 

22 commercial or residential space or hot water 

23 heating. 

24 ‘‘(b) DISTRIBUTION AMONG STATES.—Not later than 

25 September 30 of each of calendar years 2011 through 


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1 2028, the Administrator shall distribute among the States, 

2 in accordance with this section, the quantity of emission 

3 allowances allocated for the following vintage year pursu4 ant to section 782(c). The Administrator shall distribute 

5 emission allowances among the States under this section 

6 each year ratably based on the ratio of— 

7 ‘‘(1) the carbon content of oilheat fuel, propane, 

8 and kerosene sold to consumers within each State in 

9 the preceding year for residential or commercial 

10 uses; to 

11 ‘‘(2) the carbon content of oilheat fuel, propane, 

12 and kerosene sold to consumers within the United 

13 States in the preceding year for residential or com14 mercial uses. 

15 ‘‘(c) USE OF ALLOWANCES.— 

16 ‘‘(1) IN GENERAL.—States shall use emission 

17 allowances distributed under this section exclusively 

18 for the benefit of consumers of oilheat fuel, propane, 

19 or kerosene for residential or commercial purposes. 

20 Such proceeds shall be used exclusively for— 

21 ‘‘(A) cost-effective energy efficiency pro22 grams for consumers that use oilheat fuel, pro23 pane, or kerosene for residential or commercial 

24 purposes; or 


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1 ‘‘(B) rebates or other direct financial as2 sistance programs for consumers of oilheat fuel, 

3 propane, or kerosene used for residential or 

4 commercial purposes. 

5 ‘‘(2) ADMINISTRATION AND DELIVERY MECHA6 NISMS.—In administering programs supported by 

7 this section, States shall 

8 ‘‘(A) use no less than 50 percent of the 

9 value of emission allowances received under this 

10 section for cost-effective energy efficiency pro11 grams to reduce consumers’ overall fuel costs; 

12 ‘‘(B) to the extent practicable, deliver con13 sumer support under this section through exist14 ing energy efficiency and consumer energy as15 sistance programs or delivery mechanisms, in16 cluding, where appropriate, programs or mecha17 nisms administered by parties other than the 

18 State; and 

19 ‘‘(C) seek to coordinate the administration 

20 and delivery of energy efficiency and consumer 

21 energy assistance programs supported under 

22 this section, with one another and with existing 

23 programs for various fuel types, so as to deliver 

24 comprehensive, fuel-blind, coordinated programs 

25 to consumers. 


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1 ‘‘(d) REPORTING.—Each State receiving emission al2 lowances under this section shall submit to the Adminis3 trator, within 12 months of each receipt of such allow4 ances, a report, in accordance with such requirements as 

5 the Administrator may prescribe, that— 

6 ‘‘(1) describes the State’s use of emission allow7 ances distributed under this section, including a de8 scription of the energy efficiency and consumer as9 sistance programs supported with such allowances; 

10 ‘‘(2) demonstrates the cost-effectiveness of, and 

11 the energy savings and greenhouse gas emissions re12 ductions achieved by, energy efficiency programs 

13 supported under this section; and 

14 ‘‘(3) includes a report prepared by an inde15 pendent third party, in accordance with such regula16 tions as the Administrator may promulgate, evalu17 ating the performance of the energy efficiency and 

18 consumer assistance programs supported under this 

19 section. 

20 ‘‘(e) ENFORCEMENT.—If the Administrator deter21 mines that a State is not in compliance with this section, 

22 the Administrator may withhold a portion of the emission 

23 allowances, the quantity of which is equal to up to twice 

24 the quantity of the allowances that the State failed to use 

25 in accordance with the requirements of this section, that 


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1 such State would otherwise be eligible to receive under this 

2 section in later years. Allowances withheld pursuant to 

3 this subsection shall be distributed among the remaining 

4 States ratably in accordance with the formula in sub5 section (b). 

6 ‘‘SEC. 787. ALLOCATIONS TO REFINERIES. 

7 ‘‘(a) PURPOSE.—The purpose of this section is to 

8 provide emission allowance rebates to petroleum refineries 

9 in the United States in a manner that promotes energy 

10 efficiency and a reduction in greenhouse gas emissions at 

11 such facilities. 

12 ‘‘(b) DEFINITIONS.—In this section: 

13 ‘‘(1) EMISSIONS.—The term ‘emissions’ in14 cludes direct emissions from fuel combustion, proc15 ess emissions, and indirect emissions from the gen16 eration of electricity, steam, and hydrogen used to 

17 produce the output of a petroleum refinery or the 

18 petroleum refinery sector. 

19 ‘‘(2) PETROLEUM REFINERY.—The term ‘petro20 leum refinery’ means a facility classified under code 

21 324110 of the North American Industrial Classifica22 tion System of 2002. 

23 ‘‘(3) SMALL BUSINESS REFINER.—The term 

24 ‘small business refiner’ means a refiner that meets 

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1 ployee limitations criteria described in section 

2 45H(c)(1) of the Internal Revenue Code of 1986 (as 

3 in effect on the date of enactment of this section and 

4 without regard to section 45H(d)). Eligibility of a 

5 small business refiner under this paragraph shall not 

6 be recalculated or disallowed on account of (i) its 

7 merger with another small business refiner or refin8 ers after December 31, 2002 or (ii) its acquisition 

9 of another small business refiner (or refinery of such 

10 refiner) after December 31, 2002. 

11 ‘‘(c) IN GENERAL.—For each vintage year between 

12 2014 and 2026, the Administrator shall distribute allow13 ances pursuant to this section to owners and operators of 

14 petroleum refineries, including small business refiners, in 

15 the United States. 

16 ‘‘(d) DISTRIBUTION SCHEDULE.—The Administrator 

17 shall distribute emission allowances pursuant to the regu18 lations issued under subsection (e) for each vintage year 

19 no later than October 31 of the preceding calendar year. 

20 ‘‘(e) REGULATIONS.—Not later than 3 years after the 

21 date of enactment of this title, the Administrator, in con22 sultation with the Administrator of the Energy Informa23 tion Administration, shall promulgate regulations that es24 tablish a formula for distributing emission allowances con25 sistent with the purpose of this section. In establishing 


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1 such formula, the Administrator shall consider the relative 

2 complexity of refinery processes and appropriate mecha3 nisms to take energy efficiency and greenhouse gas reduc4 tions into account. If a petroleum refinery’s electricity pro5 vider received a free allocation of emission allowances pur6 suant to section 782(a), the Administrator shall take this 

7 free allocation into account when establishing such for8 mula to avoid rebates to a petroleum refinery for costs 

9 that the Administrator determines were not incurred by 

10 the petroleum refinery because the allowances were freely 

11 allocated to the petroleum refinery’s electricity provider 

12 and used for the benefit of the petroleum refinery. This 

13 formula shall apply separately to the distribution of allow14 ances allocated pursuant to section 782(j)(1) and to those 

15 allocated under section 782(j)(2). 

16 ‘‘SEC. 788. øSECTION RESERVED¿. 

17 ‘‘SEC. 789. CLIMATE CHANGE CONSUMER REFUNDS. 

18 ‘‘(a) REFUND.—In each year after deposits are made 

19 to the Climate Change Consumer Refund Account, the 

20 Secretary of the Treasury shall provide tax refunds on a 

21 per capita basis to each household in the United States 

22 that shall collectively equal the amount deposited into the 

23 Climate Change Consumer Refund Account. 


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1 ‘‘(b) LIMITATIONS.—The Secretary of the Treasury 

2 shall establish procedures to ensure that individuals who 

3 are not— 

4 ‘‘(1) citizens or nationals of the United States; 

5 or 

6 ‘‘(2) immigrants lawfully residing in the United 

7 States, 

8 are excluded for the purpose of calculating and distrib9 uting refunds under this section. 

10 ‘‘SEC. 790. EXCHANGE FOR STATE-ISSUED ALLOWANCES. 

11 ‘‘(a) IN GENERAL.—Not later than one year after the 

12 date of enactment of this title, the Administrator shall 

13 issue regulations allowing any person in the United States 

14 to exchange greenhouse gas emission allowances issued be15 fore December 31, 2011, by the State of California or for 

16 the Regional Greenhouse Gas Initiative, or the Western 

17 Climate Initiative (in this section referred to as ‘State al18 lowances’) for emission allowances established by the Ad19 ministrator under section 721(a). 

20 ‘‘(b) REGULATIONS.—Regulations issued under sub21 section (a) shall— 

22 ‘‘(1) provide that a person exchanging State al23 lowances under this section receive emission allow24 ances established under section 721(a) in the 


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1 amount that is sufficient to compensate for the cost 

2 of obtaining and holding such State allowances; 

3 ‘‘(2) establish a deadline by which persons must 

4 exchange the State allowances; and 

5 ‘‘(3) provide that the Federal emission allow6 ances disbursed pursuant to this section shall be de7 ducted from the allowances to be auctioned pursuant 

8 to section 782(d). 

9 ‘‘(c) COST OF OBTAINING STATE ALLOWANCE.—For 

10 purposes of this section, the cost of obtaining a State al11 lowance shall be the average auction price, for emission 

12 allowances issued in the year in which the State allowance 

13 was issued, under the program under which the State al14 lowance was issued. 

15 ‘‘SEC. 791. AUCTION PROCEDURES. 

16 ‘‘(a) IN GENERAL.—To the extent that auctions of 

17 emission allowances by the Administrator are authorized 

18 by this part, such auctions shall be carried out pursuant 

19 to this section and the regulations established hereunder. 

20 ‘‘(b) INITIAL REGULATIONS.—Not later than 12 

21 months after the date of enactment of this title, the Ad22 ministrator, in consultation with other agencies, as appro23 priate, shall promulgate regulations governing the auction 

24 of allowances under this section. Such regulations shall in25 clude the following requirements: 


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1 ‘‘(1) FREQUENCY; FIRST AUCTION.—Auctions 

2 shall be held four times per year at regular intervals, 

3 with the first auction to be held no later than March 

4 31, 2011. 

5 ‘‘(2) AUCTION SCHEDULE; CURRENT AND FU6 TURE VINTAGES.—The Administrator shall, at each 

7 quarterly auction under this section, offer for sale 

8 both a portion of the allowances with the same vin9 tage year as the year in which the auction is being 

10 conducted and a portion of the allowances with vin11 tage years from future years. The preceding sen12 tence shall not apply to auctions held before 2012, 

13 during which period, by necessity, the Administrator 

14 shall auction only allowances with a vintage year 

15 that is later than the year in which the auction is 

16 held. Beginning with the first auction and at each 

17 quarterly auction held thereafter, the Administrator 

18 may offer for sale allowances with vintage years of 

19 up to four years after the year in which the auction 

20 is being conducted, except as provided in section 

21 782(p). 

22 ‘‘(3) AUCTION FORMAT.—Auctions shall follow 

23 a single-round, sealed-bid, uniform price format. 

24 ‘‘(4) PARTICIPATION; FINANCIAL ASSURANCE.— 

25 Auctions shall be open to any person, except that 


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1 the Administrator may establish financial assurance 

2 requirements to ensure that auction participants can 

3 and will perform on their bids. 

4 ‘‘(5) DISCLOSURE OF BENEFICIAL OWNER5 SHIP.—Each bidder in the auction shall be required 

6 to disclose the person or entity sponsoring or bene7 fitting from the bidder’s participation in the auction 

8 if such person or entity is, in whole or in part, other 

9 than the bidder. 

10 ‘‘(6) PURCHASE LIMITS.—No person may, di11 rectly or in concert with another participant, pur12 chase more than 5 percent of the allowances offered 

13 for sale at any quarterly auction. 

14 ‘‘(7) PUBLICATION OF INFORMATION.—After 

15 the auction, the Administrator shall, in a timely 

16 fashion, publish the identities of winning bidders, 

17 the quantity of allowances obtained by each winning 

18 bidder, and the auction clearing price. 

19 ‘‘(8) OTHER REQUIREMENTS.—The Adminis20 trator may include in the regulations such other re21 quirements or provisions as the Administrator, in 

22 consultation with other agencies, as appropriate, 

23 considers appropriate to promote effective, efficient, 

24 transparent, and fair administration of auctions 

25 under this section. 


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1 ‘‘(c) REVISION OF REGULATIONS.—The Adminis2 trator may, in consultation with other agencies, as appro3 priate, at any time, revise the initial regulations promul4 gated under subsection (b) by promulgating new regula5 tions. Such revised regulations need not meet the require6 ments identified in subsection (b) if the Administrator de7 termines that an alternative auction design would be more 

8 effective, taking into account factors including costs of ad9 ministration, transparency, fairness, and risks of collusion 

10 or manipulation. In determining whether and how to re11 vise the initial regulations under this subsection, the Ad12 ministrator shall not consider maximization of revenues to 

13 the Federal Government. 

14 ‘‘(d) RESERVE AUCTION PRICE.—The minimum re15 serve auction price shall be $10 (in constant 2009 dollars) 

16 for auctions occurring in 2012. The minimum reserve 

17 price for auctions occurring in years after 2012 shall be 

18 the minimum reserve auction price for the previous year 

19 increased by 5 percent plus the rate of inflation (as meas20 ured by the Consumer Price Index for all urban con21 sumers). 

22 ‘‘(e) DELEGATION OR CONTRACT.—Pursuant to reg23 ulations under this section, the Administrator may by del24 egation or contract provide for the conduct of auctions 

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1 ments or agencies of the Federal Government or by non2 governmental agencies, groups, or organizations. 

3 ‘‘(f) SMALL BUSINESS REFINER RESERVE.—The Ad4 ministrator shall, in accordance with this subsection, issue 

5 regulations setting aside a specified number of allowances 

6 that small business refiners may purchase at the average 

7 auction price and may use to demonstrate compliance pur8 suant to section 722. These regulations shall provide the 

9 following: 

10 ‘‘(1) AMOUNT.—The Administrator shall place 

11 in the small business refiner reserve account allow12 ances that are to be sold at auction pursuant to the 

13 allocations in section 782 in an amount equal to— 

14 ‘‘(A) 6.2 percent of the emission allow15 ances established under section 721(a) for each 

16 vintage year from 2012 through 2013; 

17 ‘‘(B) 5.4 percent of the emission allow18 ances established under section 721(a) for each 

19 vintage year from 2014 through 2015; and 

20 ‘‘(C) 4.9 percent of the emission allow21 ances established under section 721(a) for each 

22 vintage year from 2016 through 2024. 

23 ‘‘(2) ALLOWED PURCHASES.—From January 1 

24 of the calendar year that matches the vintage year 

25 for which allowances have been placed in the reserve, 


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1 through January 14 of the following year, small 

2 business refiners (as defined in section 787(b)) may 

3 purchase allowances from this reserve at the price 

4 determined pursuant to paragraph (3). 

5 ‘‘(3) PRICE.—The price for allowances pur6 chased from this reserve shall be the average auction 

7 price for allowances of the same vintage year pur8 chased at auctions conducted pursuant to this sec9 tion during the 12 months preceding the purchase of 

10 the allowances. 

11 ‘‘(4) USE OF ALLOWANCES.—Allowances pur12 chased from this reserve shall only be used by the 

13 purchaser to demonstrate compliance pursuant to 

14 section 722 for attributable greenhouse gas emis15 sions in the calendar year that matches the vintage 

16 year of the purchased allowance. Allowances pur17 chased from this reserve may not be banked, traded 

18 or borrowed. 

19 ‘‘(5) LIMITATIONS ON PURCHASE AMOUNT.— 

20 The Administrator, by regulation adopted after pub21 lic notice and an opportunity for comment, shall es22 tablish procedures to distribute the ability to pur23 chase allowances from the reserve fairly among all 

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1 tential that requests to purchase allowances exceed 

2 the number of allowances available in the reserve. 

3 This regulation may place limits on the number of 

4 allowances a small business refiner may purchase 

5 from the reserve. 

6 ‘‘(6) UNSOLD ALLOWANCES.—Vintage year al7 lowances not sold from the reserve on or before Jan8 uary 15 of the calendar year following the vintage 

9 year shall be sold at an auction conducted pursuant 

10 to this section no later than March 31 of the cal11 endar year following the vintage year. If significantly 

12 more allowances are being placed in the reserve than 

13 are being purchased from the reserve several years 

14 in a row, the Administrator may adjust either the 

15 percent of allowances placed in the reserve or the 

16 date by which allowances may be purchased from the 

17 reserve. 

18 ‘‘SEC. 792. AUCTIONING ALLOWANCES FOR OTHER ENTI19 TIES. 

20 ‘‘(a) CONSIGNMENT.—Any entity holding emission al21 lowances or compensatory allowances may request that the 

22 Administrator auction, pursuant to section 791, the allow23 ances on consignment. 

24 ‘‘(b) PRICING.—When the Administrator acts under 

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1 sion allowances or compensatory allowances, the Adminis2 trator is not obligated to obtain the highest price possible 

3 for the allowances, and instead shall auction consignment 

4 allowances in the same manner and pursuant to the same 

5 rules as auctions of other allowances under section 791. 

6 The Administrator may permit the entity offering the al7 lowance for sale to condition the sale of its allowances pur8 suant to this section on a minimum reserve price that is 

9 different than the reserve auction price set pursuant to 

10 section 791(d). 

11 ‘‘(c) PROCEEDS.—For emission allowances and com12 pensatory allowances auctioned pursuant to this section, 

13 notwithstanding section 3302 of title 31, United States 

14 Code, or any other provision of law, within 90 days of re15 ceipt, the United States shall transfer the proceeds from 

16 the auction to the entity which held the allowances auc17 tioned. No funds transferred from a purchaser to a seller 

18 of emission allowances or compensatory allowances under 

19 this subsection shall be held by any officer or employee 

20 of the United States or treated for any purpose as public 

21 monies. 

22 ‘‘(d) UNSOLD ALLOWANCES.—Allowances offered for 

23 sale under this section that are not sold shall be returned 

24 to the entity in possession of the allowance, notwith25 standing section 726(b)(2)(A). 


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1 ‘‘(e) REGULATIONS.—The Administrator shall issue 

2 regulations within 24 months after the date of enactment 

3 of this title to implement this section. 

4 ‘‘SEC. 793. ESTABLISHMENT OF FUNDS. 

5 ‘‘There is hereby established in the Treasury of the 

6 United States the following separate accounts: 

7 ‘‘(1) The Strategic Reserve Fund. 

8 ‘‘(2) The Climate Change Consumer Refund 

9 Account. 

10 ‘‘(3) The Climate Change Worker Adjustment 

11 Assistance Fund. 

12 ‘‘SEC. 794. OVERSIGHT OF ALLOCATIONS. 

13 ‘‘(a) IN GENERAL.—Not later than January 1, 2014, 

14 and every 2 years thereafter, the Comptroller General of 

15 the United States shall carry out and report to Congress 

16 on the results of a review of programs administered by 

17 the Federal Government that distribute emission allow18 ances or funds from any Federal auction of allowances. 

19 ‘‘(b) CONTENTS.—Each such report shall include a 

20 comprehensive evaluation of the administration and effec21 tiveness of each program, including— 

22 ‘‘(1) the efficiency, transparency, and sound23 ness of the administration of each program; 

24 ‘‘(2) the performance of activities receiving as25 sistance under each program; 


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1 ‘‘(3) the cost-effectiveness of each program in 

2 achieving the stated purposes of the program; and 

3 ‘‘(4) recommendations, if any, for legislative, 

4 regulatory, or administrative changes to each pro5 gram to improve its effectiveness. 

6 ‘‘(c) FOCUS.—In evaluating program performance, 

7 each review under this section review shall address the ef8 fectiveness of such programs in— 

9 ‘‘(1) creating and preserving jobs; 

10 ‘‘(2) ensuring a manageable transition for 

11 working families and workers; 

12 ‘‘(3) reducing the emissions, or enhancing se13 questration, of greenhouse gases; 

14 ‘‘(4) developing clean technologies; and 

15 ‘‘(5) building resilience to the impacts of cli16 mate change.’’. 

17 Subtitle C—Additional Greenhouse 

18 Gas Standards 

19 SEC. 331. GREENHOUSE GAS STANDARDS. 

20 The Clean Air Act (42 U.S.C. 7401 and following), 

21 as amended by subtitles A and B of this title, is further 

22 amended by adding the following new title after title VII: 


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1 ‘‘TITLE VIII—ADDITIONAL 

2 GREENHOUSE GAS STANDARDS 

3 ‘‘SEC. 801. DEFINITIONS. 

4 ‘‘For purposes of this title, terms that are defined 

5 in title VII, except for the term ‘stationary source’, shall 

6 have the meaning given those terms in title VII. 

7 ‘‘PART A—STATIONARY SOURCE STANDARDS 

8 ‘‘SEC. 811. STANDARDS OF PERFORMANCE. 

9 ‘‘(a) UNCAPPED STATIONARY SOURCES.— 

10 ‘‘(1) INVENTORY OF SOURCE CATEGORIES.—(A) 

11 Within 12 months after the date of enactment of 

12 this title, the Administrator shall publish under sec13 tion 111(b)(1)(A) an inventory of categories of sta14 tionary sources that consist of those categories that 

15 contain sources that individually had uncapped 

16 greenhouse gas emissions greater than 10,000 tons 

17 of carbon dioxide equivalent and that, in the aggre18 gate, were responsible for emitting at least 20 per19 cent annually of the uncapped greenhouse gas emis20 sions. 

21 ‘‘(B) The Administrator shall include in the in22 ventory under this paragraph each source category 

23 that is responsible for at least 10 percent of the un24 capped methane emissions in 2005. Notwithstanding 

25 any other provision, the inventory required by this 


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1 section shall not include sources of enteric fermenta2 tion. The list under this paragraph shall include in3 dustrial sources, the emissions from which, when 

4 added to the capped emissions from industrial 

5 sources, constitute at least 95 percent of the green6 house gas emissions of the industrial sector. 

7 ‘‘(C) For purposes of this subsection, emissions 

8 shall be calculated using tons of carbon dioxide 

9 equivalents. In promulgating the inventory required 

10 by this paragraph and the schedule required under 

11 by paragraph (2)(C), the Administrator shall use the 

12 most current emissions data available at the time of 

13 promulgation, except as provided in subparagraph 

14 (B). 

15 ‘‘(D) Notwithstanding any other provisions, the 

16 Administrator may list under 111(b) any source cat17 egory identified in the inventory required by this 

18 subsection without making a finding that the source 

19 category causes or contributes significantly to, air 

20 pollution with may be reasonably anticipated to en21 danger public health or welfare. 

22 ‘‘(2) STANDARDS AND SCHEDULE.—(A) For 

23 each category identified as provided in paragraph 

24 (1), the Administrator shall promulgate standards of 

25 performance under section 111 for the uncapped 


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1 emissions of greenhouse gases from stationary 

2 sources in that category and shall promulgate cor3 responding regulations under section 111(d). 

4 ‘‘(B) The Administrator shall promulgate 

5 standards as required by this subsection for sta6 tionary sources in categories identified as provided 

7 in paragraph (1) as expeditiously as practicable, as8 suring that— 

9 ‘‘(i) standards for identified source cat10 egories that, combined, emitted 80 percent or 

11 more of the greenhouse gas emissions of the 

12 identified source categories shall be promul13 gated not later than 3 years after the date of 

14 enactment of this title and shall include stand15 ards for natural gas extraction; and 

16 ‘‘(ii) for all other identified source cat17 egories— 

18 ‘‘(I) standards for not less than an 

19 additional 25 percent of the identified cat20 egories shall be promulgated not later than 

21 5 years after the date of enactment of this 

22 title; 

23 ‘‘(II) standards for not less than an 

24 additional 25 percent of the identified cat25 egories shall be promulgated not later than 


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1 7 years after the date of enactment of this 

2 title; and 

3 ‘‘(III) standards for all the identified 

4 categories shall be promulgated not later 

5 than 10 years after the date of enactment 

6 of this title. 

7 ‘‘(C) Not later than 24 months after the date 

8 of enactment of this title and after notice and oppor9 tunity for comment, the Administrator shall publish 

10 a schedule establishing a date for the promulgation 

11 of standards for each category of sources identified 

12 pursuant to paragraph (1). The date for each cat13 egory shall be consistent with the requirements of 

14 subparagraph (B). The determination of priorities 

15 for the promulgation of standards pursuant to this 

16 paragraph is not a rulemaking and shall not be sub17 ject to judicial review, except that failure to promul18 gate any standard pursuant to the schedule estab19 lished by this paragraph shall be subject to review 

20 under section 304(a)(2). 

21 ‘‘(D) Notwithstanding section 307, no action of 

22 the Administrator listing a source category under 

23 paragraph (1) shall be a final agency action subject 

24 to judicial review, except that any such action may 

25 be reviewed under section 307 when the AdminisVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00789 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 trator issues performance standards for such cat2 egory. 

3 ‘‘(b) CAPPED SOURCES.—No standard of perform4 ance shall be established under section 111 for capped 

5 greenhouse gas emissions from a capped source unless the 

6 Administrator determines that such standards are appro7 priate because of effects that do not include climate 

8 change effects. In promulgating a standard of perform9 ance under section 111 for the emission from capped 

10 sources of any air pollutant that is not a greenhouse gas, 

11 the Administrator shall treat the emission of any green12 house gas by those entities as a nonair quality public 

13 health and environmental impact within the meaning of 

14 section 111(a)(1). 

15 ‘‘(c) PERFORMANCE STANDARDS.—For purposes of 

16 setting a performance standard for source categories iden17 tified pursuant to subsection (a)— 

18 ‘‘(1) The Administrator shall take into account 

19 the goal of reducing total United States greenhouse 

20 gas emissions as set forth in section 702. 

21 ‘‘(2) The Administrator may promulgate a de22 sign, equipment, work practice, or operational stand23 ard, or any combination thereof, under section 111 

24 in lieu of a standard of performance under that sec25 tion without regard to any determination of feasiVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00790 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 bility that would otherwise be required under section 

2 111(h). 

3 ‘‘(3) Notwithstanding any other provision, in 

4 setting the level of each standard required by this 

5 section, the Administrator shall take into account 

6 projections of allowance prices, such that the mar7 ginal cost of compliance (expressed as dollars per 

8 ton of carbon dioxide equivalent reduced) imposed by 

9 the standard would not, in the judgement of the Ad10 ministrator, be expected to exceed the Administra11 tor’s projected allowance prices over the time period 

12 spanning from the date of initial compliance to the 

13 date that the next revisions of the standard would 

14 come into effect pursuant to the schedule under sec15 tion 111(b)(1)(B). 

16 ‘‘(d) DEFINITIONS.—In this section, the terms ‘un17 capped greenhouse gas emissions’ and ‘uncapped methane 

18 emissions’ mean those greenhouse gas or methane emis19 sions, respectively, to which section 722 would not have 

20 applied if the requirements of this title had been in effect 

21 for the same year as the emissions data upon which the 

22 list is based. 

23 ‘‘(e) STUDY OF THE EFFECTS OF PERFORMANCE

24 STANDARDS.— 


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1 ‘‘(1) STUDY.—The Administrator shall conduct 

2 a study of the impacts of performance standards re3 quired under this section, which shall evaluate the 

4 effect of such standards on the— 

5 ‘‘(A) costs of achieving compliance with the 

6 economy-wide reduction goals specified in sec7 tion 702 and the reduction targets specified in 

8 section 703; 

9 ‘‘(B) available supply of offset credits; and 

10 ‘‘(C) ability to achieve the economy-wide 

11 reduction goals specified in section 702 and any 

12 other benefits of such standards. 

13 ‘‘(2) REPORT.—The Administrator shall submit 

14 to the House Energy and Commerce Committee a 

15 report that describes the results of the study not 

16 later than 18 months after the publication of the 

17 standards required under subsection (a)(2)(B)(i). 

18 ‘‘PART C—EXEMPTIONS FROM OTHER PROGRAMS 

19 ‘‘SEC. 831. CRITERIA POLLUTANTS. 

20 ‘‘As of the date of the enactment of the Safe Climate 

21 Act, no greenhouse gas may be added to the list under 

22 section 108(a) on the basis of its effect on global climate 

23 change. 


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1 ‘‘SEC. 832. INTERNATIONAL AIR POLLUTION. 

2 ‘‘Section 115 shall not apply to an air pollutant with 

3 respect to that pollutant’s contribution to global warming. 

4 ‘‘SEC. 833. HAZARDOUS AIR POLLUTANTS. 

5 ‘‘No greenhouse gas may be added to the list of haz6 ardous air pollutants under section 112 unless such green7 house gas meets the listing criteria of section 112(b) inde8 pendent of its effects on global climate change. 

9 ‘‘SEC. 834. NEW SOURCE REVIEW. 

10 ‘‘The provisions of part C of title I shall not apply 

11 to a major emitting facility that is initially permitted or 

12 modified after January 1, 2009, on the basis of its emis13 sions of any greenhouse gas. 

14 ‘‘SEC. 835. TITLE V PERMITS. 

15 ‘‘Notwithstanding any provision of title III or V, no 

16 stationary source shall be required to apply for, or operate 

17 pursuant to, a permit under title V, solely because the 

18 source emits any greenhouse gases that are regulated sole19 ly because of their effect on global climate change.’’. 

20 SEC. 332. HFC REGULATION. 

21 (a) IN GENERAL.—Title VI of the Clean Air Act (42 

22 U.S.C. 7671 et seq.) (relating to stratospheric ozone pro23 tection) is amended by adding at the end the following: 

24 ‘‘SEC. 619. HYDROFLUOROCARBONS (HFCS). 

25 ‘‘(a) TREATMENT AS CLASS II, GROUP II SUB26 STANCES.—Except as otherwise provided in this section, 


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1 hydrofluorocarbons shall be treated as class II substances 

2 for purposes of applying the provisions of this title. The 

3 Administrator shall establish two groups of class II sub4 stances. Class II, group I substances shall include all 

5 hydrochlorofluorocarbons (HCFCs) listed pursuant to sec6 tion 602(b). Class II, group II substances shall include 

7 each of the following: 

8 ‘‘(1) Hydrofluorocarbon-23 (HFC-23). 

9 ‘‘(2) Hydrofluorocarbon-32 (HFC-32). 

10 ‘‘(3) Hydrofluorocarbon-41 (HFC-41). 

11 ‘‘(4) Hydrofluorocarbon-125 (HFC-125). 

12 ‘‘(5) Hydrofluorocarbon-134 (HFC-134). 

13 ‘‘(6) Hydrofluorocarbon-134a (HFC-134a). 

14 ‘‘(7) Hydrofluorocarbon-143 (HFC-143). 

15 ‘‘(8) Hydrofluorocarbon-143a (HFC-143a). 

16 ‘‘(9) Hydrofluorocarbon-152 (HFC-152). 

17 ‘‘(10) Hydrofluorocarbon-152a (HFC-152a). 

18 ‘‘(11) Hydrofluorocarbon-227ea (HFC-227ea). 

19 ‘‘(12) Hydrofluorocarbon-236cb (HFC-236cb). 

20 ‘‘(13) Hydrofluorocarbon-236ea (HFC-236ea). 

21 ‘‘(14) Hydrofluorocarbon-236fa (HFC-236fa). 

22 ‘‘(15) Hydrofluorocarbon-245ca (HFC-245ca). 

23 ‘‘(16) Hydrofluorocarbon-245fa (HFC-245fa). 

24 ‘‘(17) Hydrofluorocarbon-365mfc (HFC25 365mfc). 


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1 ‘‘(18) Hydrofluorocarbon-43-10mee (HFC-43- 

2 10mee). 

3 ‘‘(19) Hydrofluoroolefin-1234yf (HFO-1234yf). 

4 ‘‘(20) Hydrofluoroolefin-1234ze (HFO-1234ze). 

5 Not later than 6 months after the date of enactment of 

6 this title, the Administrator shall publish an initial list of 

7 class II, group II substances, which shall include the sub8 stances listed in this subsection. The Administrator may 

9 add to the list of class II, group II substances any other 

10 substance used as a substitute for a class I or II substance 

11 if the Administrator determines that 1 metric ton of the 

12 substance makes the same or greater contribution to glob13 al warming over 100 years as 1 metric ton of carbon diox14 ide. Within 24 months after the date of enactment of this 

15 section, the Administrator shall amend the regulations 

16 under this title (including the regulations referred to in 

17 sections 603, 608, 609, 610, 611, 612, and 613) to apply 

18 to class II, group II substances. 

19 ‘‘(b) CONSUMPTION AND PRODUCTION OF CLASS II, 

20 GROUP II SUBSTANCES.— 

21 ‘‘(1) IN GENERAL.— 

22 ‘‘(A) CONSUMPTION PHASE DOWN.—In the 

23 case of class II, group II substances, in lieu of 

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1 ulations phasing down the consumption of class 

2 II, group II substances in the United States, 

3 and the importation of products containing any 

4 class II, group II substance, in accordance with 

5 this subsection within 18 months after the date 

6 of enactment of this section. Effective January 

7 1, 2012, it shall be unlawful for any person to 

8 produce any class II, group II substance, im9 port any class II, group II substance, or import 

10 any product containing any class II, group II 

11 substance without holding one consumption al12 lowance or one destruction offset credit for each 

13 carbon dioxide equivalent ton of the class II, 

14 group II substance. Any person who exports a 

15 class II, group II substance for which a con16 sumption allowance was retired may receive a 

17 refund of that allowance from the Adminis18 trator following the export. 

19 ‘‘(B) PRODUCTION.—If the United States 

20 becomes a party or otherwise adheres to a mul21 tilateral agreement, including any amendment 

22 to the Montreal Protocol on Substances That 

23 Deplete the Ozone Layer, that restricts the pro24 duction of class II, group II substances, the Ad25 ministrator shall promulgate regulations estabVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00796 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 lishing a baseline for the production of class II, 

2 group II substances in the United States and 

3 phasing down the production of class II, group 

4 II substances in the United States, in accord5 ance with such multilateral agreement and sub6 ject to the same exceptions and other provisions 

7 as are applicable to the phase down of con8 sumption of class II, group II substances under 

9 this section (except that the Administrator shall 

10 not require a person who obtains production al11 lowances from the Administrator to make pay12 ment for such allowances if the person is mak13 ing payment for a corresponding quantity of 

14 consumption allowances of the same vintage 

15 year). Upon the effective date of such regula16 tions, it shall be unlawful for any person to 

17 produce any class II, group II substance with18 out holding one consumption allowance and one 

19 production allowance, or one destruction offset 

20 credit, for each carbon dioxide equivalent ton of 

21 the class II, group II substance. 

22 ‘‘(C) INTEGRITY OF CAP.—To maintain 

23 the integrity of the class II, group II cap, the 

24 Administrator may, through rulemaking, limit 

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1 gation that may be met through the use of de2 struction offset credits or banked allowances. 

3 ‘‘(D) COUNTING OF VIOLATIONS.—Each 

4 consumption allowance, production allowance, 

5 or destruction offset credit not held as required 

6 by this section shall be a separate violation of 

7 this section. 

8 ‘‘(2) SCHEDULE.—Pursuant to the regulations 

9 promulgated pursuant to paragraph (1)(A), the 

10 number of class II, group II consumption allowances 

11 established by the Administrator for each calendar 

12 year beginning in 2012 shall be the following per13 centage of the baseline, as established by the Admin14 istrator pursuant to paragraph (3): 

‘‘Calendar Year Percent of Baseline 

2012 90 

2013 87.5 

2014 85 

2015 82.5 

2016 80 

2017 77.5 

2018 75 

2019 71 

2020 67 

2021 63 

2022 59 


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‘‘Calendar Year Percent of Baseline 

2023 54 

2024 50 

2025 46 

2026 42 

2027 38 

2028 34 

2029 30 

2030 25 

2031 21 

2032 17 

after 2032 15 

1 ‘‘(3) BASELINE.—(A) Within 12 months after 

2 the date of enactment of this section, the Adminis3 trator shall promulgate regulations to establish the 

4 baseline for purposes of paragraph (2). The baseline 

5 shall be the sum, expressed in metric tons of carbon 

6 dioxide equivalents, of— 

7 ‘‘(i) the annual average consumption of all 

8 class II substances in calendar years 2004, 

9 2005, and 2006; plus 

10 ‘‘(ii) the annual average quantity of all 

11 class II substances contained in imported prod12 ucts in calendar years 2004, 2005, and 2006. 

13 ‘‘(B) Notwithstanding subparagraph (A), if the 

14 Administrator determines that the baseline is higher 


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1 than 370 million metric tons of carbon dioxide 

2 equivalents, then the Administrator shall establish 

3 the baseline at 370 million metric tons of carbon di4 oxide equivalents. 

5 ‘‘(C) Notwithstanding subparagraph (A), if the 

6 Administrator determines that the baseline is lower 

7 than 280 million metric tons of carbon dioxide 

8 equivalents, then the Administrator shall establish 

9 the baseline at 280 million metric tons of carbon di10 oxide equivalents. 

11 ‘‘(4) DISTRIBUTION OF ALLOWANCES.— 

12 ‘‘(A) IN GENERAL.—Pursuant to the regu13 lations promulgated under paragraph (1)(A), 

14 for each calendar year beginning in 2012, the 

15 Administrator shall sell consumption allowances 

16 in accordance with this paragraph. 

17 ‘‘(B) ESTABLISHMENT OF POOLS.—The 

18 Administrator shall establish two allowance 

19 pools. Eighty percent of the consumption allow20 ances available for a calendar year shall be 

21 placed in the producer-importer pool, and 20 

22 percent of the consumption allowances available 

23 for a calendar year shall be placed in the sec24 ondary pool. 

25 ‘‘(C) PRODUCER-IMPORTER POOL.— 


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1 ‘‘(i) AUCTION.—(I) For each calendar 

2 year, the Administrator shall offer for sale 

3 at auction the following percentage of the 

4 consumption allowances in the producer5 importer pool: 

‘‘Calendar Year Percent Available for Auction 

2012 10 

2013 20 

2014 30 

2015 40 

2016 50 

2017 60 

2018 70 

2019 80 

2020 and thereafter 90 

6 ‘‘(II) Any person who produced or im7 ported any class II substance during cal8 endar year 2004, 2005, or 2006 may par9 ticipate in the auction. No other persons 

10 may participate in the auction unless per11 mitted to do so pursuant to subclause 

12 (III). 

13 ‘‘(III) Not later than three years after 

14 the date of the initial auction and from 

15 time to time thereafter, the Administrator 

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1 er any persons who did not produce or im2 port a class II substance during calendar 

3 year 2004, 2005, or 2006 will be permitted 

4 to participate in future auctions. The Ad5 ministrator shall base this determination 

6 on the duration, consistency, and scale of 

7 such person’s purchases of consumption al8 lowances in the secondary pool under sub9 paragraph (D)(ii)(III), as well as economic 

10 or technical hardship and other factors 

11 deemed relevant by the Administrator. 

12 ‘‘(IV) The Administrator shall set a 

13 minimum bid per consumption allowance of 

14 the following: 

15 ‘‘(aa) For vintage year 2012, 

16 $1.00. 

17 ‘‘(bb) For vintage year 2013, 

18 $1.20. 

19 ‘‘(cc) For vintage year 2014, 

20 $1.40. 

21 ‘‘(dd) For vintage year 2015, 

22 $1.60. 

23 ‘‘(ee) For vintage year 2016, 

24 $1.80. 


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1 ‘‘(ff) For vintage year 2017, 

2 $2.00. 

3 ‘‘(gg) For vintage year 2018 and 

4 thereafter, $2.00 adjusted for infla5 tion after vintage year 2017 based 

6 upon the producer price index as pub7 lished by the Department of Com8 merce. 

9 ‘‘(ii) NON-AUCTION SALE.—(I) For 

10 each calendar year, as soon as practicable 

11 after auction, the Administrator shall offer 

12 for sale the remaining consumption allow13 ances in the producer-importer pool at the 

14 following prices: 

15 ‘‘(aa) A fee of $1.00 per vintage 

16 year 2012 allowance. 

17 ‘‘(bb) A fee of $1.20 per vintage 

18 year 2013 allowance. 

19 ‘‘(cc) A fee of $1.40 per vintage 

20 year 2014 allowance. 

21 ‘‘(dd) For each vintage year 

22 2015 allowance, a fee equal to the av23 erage of $1.10 and the auction clear24 ing price for vintage year 2014 allow25 ances. 


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1 ‘‘(ee) For each vintage year 2016 

2 allowance, a fee equal to the average 

3 of $1.30 and the auction clearing 

4 price for vintage year 2015 allow5 ances. 

6 ‘‘(ff) For each vintage year 2017 

7 allowance, a fee equal to the average 

8 of $1.40 and the auction clearing 

9 price for vintage year 2016 allow10 ances. 

11 ‘‘(gg) For each allowance of vin12 tage year 2018 and subsequent vin13 tage years, a fee equal to the auction 

14 clearing price for that vintage year. 

15 ‘‘(II) The Administrator shall offer to 

16 sell the remaining consumption allowances 

17 in the producer-importer pool to producers 

18 of class II, group II substances and im19 porters of class II, group II substances in 

20 proportion to their relative allocation 

21 share. 

22 ‘‘(III) Such allocation share for such 

23 sale shall be determined by the Adminis24 trator using such producer’s or importer’s 

25 annual average data on class II substances 


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1 from calendar years 2004, 2005, and 

2 2006, on a carbon dioxide equivalent basis, 

3 and— 

4 ‘‘(aa) shall be based on a pro5 ducer’s production, plus importation, 

6 plus acquisitions and purchases from 

7 persons who produced class II sub8 stances in the United States during 

9 calendar years 2004, 2005, or 2006, 

10 less exportation, less transfers and 

11 sales to persons who produced class II 

12 substances in the United States dur13 ing calendar years 2004, 2005, or 

14 2006; and 

15 ‘‘(bb) for an importer of class II 

16 substances that did not produce in the 

17 United States any class II substance 

18 during calendar years 2004, 2005, 

19 and 2006, shall be based on the im20 porter’s importation less exportation. 

21 For purposes of item (aa), the Adminis22 trator shall account for 100 percent of 

23 class II, group II substances and 60 per24 cent of class II, group I substances. For 

25 purposes of item (bb), the Administrator 


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1 shall account for 100 percent of class II, 

2 group II substances and 100 percent of 

3 class II, group I substances. 

4 ‘‘(IV) Any consumption allowances 

5 made available for nonauction sale to a 

6 specific producer or importer of class II, 

7 group II substances but not purchased by 

8 the specific producer or importer shall be 

9 made available for sale to any producer or 

10 importer of class II substances during cal11 endar years 2004, 2005, or 2006. If de12 mand for such consumption allowances ex13 ceeds supply of such consumption allow14 ances, the Administrator shall develop and 

15 utilize criteria for the sale of such con16 sumption allowances that may include pro 

17 rata shares, historic production and impor18 tation, economic or technical hardship, or 

19 other factors deemed relevant by the Ad20 ministrator. If the supply of such con21 sumption allowances exceeds demand, the 

22 Administrator may offer such consumption 

23 allowances for sale in the secondary pool as 

24 set forth in subparagraph (D). 


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1 ‘‘(D) SECONDARY POOL.—(i) For each cal2 endar year, as soon as practicable after the auc3 tion required in subparagraph (C), the Adminis4 trator shall offer for sale the consumption al5 lowances in the secondary pool at the prices 

6 listed in subparagraph (C)(ii). 

7 ‘‘(ii) The Administrator shall accept appli8 cations for purchase of secondary pool con9 sumption allowances from— 

10 ‘‘(I) importers of products containing 

11 class II, group II substances; 

12 ‘‘(II) persons who purchased any class 

13 II, group II substance directly from a pro14 ducer or importer of class II, group II sub15 stances for use in a product containing a 

16 class II, group II substance, a manufac17 turing process, or a reclamation process; 

18 ‘‘(III) persons who did not produce or 

19 import a class II substance during cal20 endar year 2004, 2005, or 2006, but who 

21 the Administrator determines have subse22 quently taken significant steps to produce 

23 or import a substantial quantity of any 

24 class II, group II substance; and 


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1 ‘‘(IV) persons who produced or im2 ported any class II substance during cal3 endar year 2004, 2005, or 2006. 

4 ‘‘(iii) If the supply of consumption allow5 ances in the secondary pool equals or exceeds 

6 the demand for consumption allowances in the 

7 secondary pool as presented in the applications 

8 for purchase, the Administrator shall sell the 

9 consumption allowances in the secondary pool 

10 to the applicants in the amounts requested in 

11 the applications for purchase. Any consumption 

12 allowances in the secondary pool not purchased 

13 in a calendar year may be rolled over and added 

14 to the quantity available in the secondary pool 

15 in the following year. 

16 ‘‘(iv) If the demand for consumption allow17 ances in the secondary pool as presented in the 

18 applications for purchase exceeds the supply of 

19 consumption allowances in the secondary pool, 

20 the Administrator shall sell the consumption al21 lowances as follows: 

22 ‘‘(I) The Administrator shall first sell 

23 the consumption allowances in the sec24 ondary pool to any importers of products 

25 containing class II, group II substances in 


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1 the amounts requested in their applications 

2 for purchase. If the demand for such con3 sumption allowances exceeds supply of 

4 such consumption allowances, the Adminis5 trator shall develop and utilize criteria for 

6 the sale of such consumption allowances 

7 among importers of products containing 

8 class II, group II substances that may in9 clude pro rata shares, historic importation, 

10 economic or technical hardship, or other 

11 factors deemed relevant by the Adminis12 trator. 

13 ‘‘(II) The Administrator shall next 

14 sell any remaining consumption allowances 

15 to persons identified in subclauses (II) and 

16 (III) of clause (ii) in the amounts re17 quested in their applications for purchase. 

18 If the demand for such consumption allow19 ances exceeds remaining supply of such 

20 consumption allowances, the Administrator 

21 shall develop and utilize criteria for the 

22 sale of such consumption allowances 

23 among subclauses (II) and (III) applicants 

24 that may include pro rata shares, historic 

25 use, economic or technical hardship, or 


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1 other factors deemed relevant by the Ad2 ministrator. 

3 ‘‘(III) The Administrator shall then 

4 sell any remaining consumption allowances 

5 to persons who produced or imported any 

6 class II substance during calendar year 

7 2004, 2005, or 2006 in the amounts re8 quested in their applications for purchase. 

9 If demand for such consumption allow10 ances exceeds remaining supply of such 

11 consumption allowances, the Administrator 

12 shall develop and utilize criteria for the 

13 sale of such consumption allowances that 

14 may include pro rata shares, historic pro15 duction and importation, economic or tech16 nical hardship, or other factors deemed rel17 evant by the Administrator. 

18 ‘‘(IV) Each person who purchases 

19 consumption allowances in a non-auction 

20 sale under this subparagraph shall be re21 quired to disclose the person or entity 

22 sponsoring or benefitting from the pur23 chases if such person or entity is, in whole 

24 or in part, other than the purchaser or the 

25 purchaser’s employer. 


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1 ‘‘(E) DISCRETION TO WITHHOLD ALLOW2 ANCES.—Nothing in this paragraph prevents 

3 the Administrator from exercising discretion to 

4 withhold and retire consumption allowances 

5 that would otherwise be available for auction or 

6 nonauction sale. Not later than 18 months after 

7 the date of enactment of this section, the Ad8 ministrator shall promulgate regulations estab9 lishing criteria for withholding and retiring con10 sumption allowances. 

11 ‘‘(5) BANKING.—A consumption allowance or 

12 destruction offset credit may be used to meet the 

13 compliance obligation requirements of paragraph (1) 

14 in— 

15 ‘‘(A) the vintage year for the allowance or 

16 destruction offset credit; or 

17 ‘‘(B) any calendar year subsequent to the 

18 vintage year for the allowance or destruction 

19 offset credit. 

20 ‘‘(6) AUCTIONS.— 

21 ‘‘(A) INITIAL REGULATIONS.—Not later 

22 than 18 months after the date of enactment of 

23 this section, the Administrator shall promulgate 

24 regulations governing the auction of allowances 


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1 under this section. Such regulations shall in2 clude the following requirements: 

3 ‘‘(i) FREQUENCY; FIRST AUCTION.— 

4 Auctions shall be held one time per year at 

5 regular intervals, with the first auction to 

6 be held no later than October 31, 2011. 

7 ‘‘(ii) AUCTION FORMAT.—Auctions 

8 shall follow a single-round, sealed-bid, uni9 form price format. 

10 ‘‘(iii) FINANCIAL ASSURANCE.—The 

11 Administrator may establish financial as12 surance requirements to ensure that auc13 tion participants can and will perform on 

14 their bids. 

15 ‘‘(iv) DISCLOSURE OF BENEFICIAL

16 OWNERSHIP.—Each bidder in the auction 

17 shall be required to disclose the person or 

18 entity sponsoring or benefitting from the 

19 bidder’s participation in the auction if such 

20 person or entity is, in whole or in part, 

21 other than the bidder. 

22 ‘‘(v) PUBLICATION OF INFORMA23 TION.—After the auction, the Adminis24 trator shall, in a timely fashion, publish 

25 the number of bidders, number of winning 


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1 bidders, the quantity of allowances sold, 

2 and the auction clearing price. 

3 ‘‘(vi) BIDDING LIMITS IN 2012.—In 

4 the vintage year 2012 auction, no auction 

5 participant may, directly or in concert with 

6 another participant, bid for or purchase 

7 more allowances offered for sale at the 

8 auction than the greater of— 

9 ‘‘(I) the number of allowances 

10 which, when added to the number of 

11 allowances available for purchase by 

12 the participant in the producer-im13 porter pool non-auction sale, would 

14 equal the participant’s annual average 

15 consumption of class II, group II sub16 stances in calendar years 2004, 2005, 

17 and 2006; or 

18 ‘‘(II) the number of allowances 

19 equal to the product of— 

20 ‘‘(aa) 1.20 multiplied by the 

21 participant’s allocation share of 

22 the producer-importer pool non23 auction sale as determined under 

24 paragraph (4)(C)(ii); and 


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1 ‘‘(bb) the number of vintage 

2 year 2012 allowances offered at 

3 auction. 

4 ‘‘(vii) BIDDING LIMITS IN 2013.—In 

5 the vintage year 2013 auction, no auction 

6 participant may, directly or in concert with 

7 another participant, bid for or purchase 

8 more allowances offered for sale at the 

9 auction than the product of— 

10 ‘‘(I) 1.15 multiplied by the ratio 

11 of the total number of vintage year 

12 2012 allowances purchased by the 

13 participant from the auction and from 

14 the producer-importer pool non-auc15 tion sale to the total number of vin16 tage year 2012 allowances in the pro17 ducer-importer pool; and 

18 ‘‘(II) the number of vintage year 

19 2013 allowances offered at auction. 

20 ‘‘(viii) BIDDING LIMITS IN SUBSE21 QUENT YEARS.—In the auctions for vin22 tage year 2014 and subsequent vintage 

23 years, no auction participant may, directly 

24 or in concert with another participant, bid 

25 for or purchase more allowances offered 


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1 for sale at the auction than the product 

2 of— 

3 ‘‘(I) 1.15 multiplied by the ratio 

4 of the highest number of allowances 

5 required to be held by the participant 

6 in any of the three prior vintage years 

7 to meet its compliance obligation 

8 under paragraph (1) to the total num9 ber of allowances in the producer-im10 porter pool for such vintage year; and 

11 ‘‘(II) the number of allowances 

12 offered at auction for that vintage 

13 year. 

14 ‘‘(ix) OTHER REQUIREMENTS.—The 

15 Administrator may include in the regula16 tions such other requirements or provisions 

17 as the Administrator considers necessary 

18 to promote effective, efficient, transparent, 

19 and fair administration of auctions under 

20 this section. 

21 ‘‘(B) REVISION OF REGULATIONS.—The 

22 Administrator may, at any time, revise the ini23 tial regulations promulgated under subpara24 graph (A) based on the Administrator’s experi25 ence in administering allowance auctions by 


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1 promulgating new regulations. Such revised reg2 ulations need not meet the requirements identi3 fied in subparagraph (A) if the Administrator 

4 determines that an alternative auction design 

5 would be more effective, taking into account 

6 factors including costs of administration, trans7 parency, fairness, and risks of collusion or ma8 nipulation. In determining whether and how to 

9 revise the initial regulations under this para10 graph, the Administrator shall not consider 

11 maximization of revenues to the Federal Gov12 ernment. 

13 ‘‘(C) DELEGATION OR CONTRACT.—Pursu14 ant to regulations under this section, the Ad15 ministrator may, by delegation or contract, pro16 vide for the conduct of auctions under the Ad17 ministrator’s supervision by other departments 

18 or agencies of the Federal Government or by 

19 nongovernmental agencies, groups, or organiza20 tions. 

21 ‘‘(7) PAYMENTS FOR ALLOWANCES.— 

22 ‘‘(A) INITIAL REGULATIONS.—Not later 

23 than 18 months after the date of enactment of 

24 this section, the Administrator shall promulgate 

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1 ances purchased in auction and non-auction 

2 sales under this section. Such regulations shall 

3 include the requirement that, in the event that 

4 full payment for purchased allowances is not 

5 made on the date of purchase, equal payments 

6 shall be made one time per calendar quarter 

7 with all payments for allowances of a vintage 

8 year made by the end of that vintage year. 

9 ‘‘(B) REVISION OF REGULATIONS.— The 

10 Administrator may, at any time, revise the ini11 tial regulations promulgated under subpara12 graph (A) based on the Administrator’s experi13 ence in administering collection of payments by 

14 promulgating new regulations. Such revised reg15 ulations need not meet the requirements identi16 fied in subparagraph (A) if the Administrator 

17 determines that an alternative payment struc18 ture or frequency would be more effective, tak19 ing into account factors including cost of ad20 ministration, transparency, and fairness. In de21 termining whether and how to revise the initial 

22 regulations under this paragraph, the Adminis23 trator shall not consider maximization of reve24 nues to the Federal Government. 


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1 ‘‘(C) PENALTIES FOR NON-PAYMENT.— 

2 Failure to pay for purchased allowances in ac3 cordance with the regulations promulgated pur4 suant to this paragraph shall be a violation of 

5 the requirements of subsection (b). Section 

6 113(c)(3) shall apply in the case of any person 

7 who knowingly fails to pay for purchased allow8 ances in accordance with the regulations pro9 mulgated pursuant to this paragraph. 

10 ‘‘(8) IMPORTED PRODUCTS.—If the United 

11 States becomes a party or otherwise adheres to a 

12 multilateral agreement, including any amendment to 

13 the Montreal Protocol on Substances That Deplete 

14 the Ozone Layer, which restricts the production or 

15 consumption of class II, group II substances— 

16 ‘‘(A) as of the date on which such agree17 ment or amendment enters into force, it shall 

18 no longer be unlawful for any person to import 

19 from a party to such agreement or amendment 

20 any product containing any class II, group II 

21 substance whose production or consumption is 

22 regulated by such agreement or amendment 

23 without holding one consumption allowance or 

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1 oxide equivalent ton of the class II, group II 

2 substance; 

3 ‘‘(B) the Administrator shall promulgate 

4 regulations within 12 months of the date the 

5 United States becomes a party or otherwise ad6 heres to such agreement or amendment, or the 

7 date on which such agreement or amendment 

8 enters into force, whichever is later, to establish 

9 a new baseline for purposes of paragraph (2), 

10 which new baseline shall be the original baseline 

11 less the carbon dioxide equivalent of the annual 

12 average quantity of any class II substances reg13 ulated by such agreement or amendment con14 tained in products imported from parties to 

15 such agreement or amendment in calendar 

16 years 2004, 2005, and 2006; 

17 ‘‘(C) as of the date on which such agree18 ment or amendment enters into force, no per19 son importing any product containing any class 

20 II, group II substance may, directly or in con21 cert with another person, purchase any con22 sumption allowances for sale by the Adminis23 trator for the importation of products from a 

24 party to such agreement or amendment that 


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1 contain any class II, group II substance re2 stricted by such agreement or amendment; and 

3 ‘‘(D) the Administrator may adjust the 

4 two allowance pools established in paragraph 

5 (4) such that up to 90 percent of the consump6 tion allowances available for a calendar year are 

7 placed in the producer-importer pool with the 

8 remaining consumption allowances placed in the 

9 secondary pool. 

10 ‘‘(9) OFFSETS.— 

11 ‘‘(A) CHLOROFLUOROCARBON DESTRUC12 TION.—Within 18 months after the date of en13 actment of this section, the Administrator shall 

14 promulgate regulations to provide for the 

15 issuance of offset credits for the destruction, in 

16 the calendar year 2012 or later, of 

17 chlorofluorocarbons in the United States. The 

18 Administrator shall establish and distribute to 

19 the destroying entity a quantity of destruction 

20 offset credits equal to 0.8 times the number of 

21 metric tons of carbon dioxide equivalents of re22 duction achieved through the destruction. No 

23 destruction offset credits shall be established 

24 for the destruction of a class II, group II sub25 stance. 


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1 ‘‘(B) DEFINITION.—For purposes of this 

2 paragraph, the term ‘destruction’ means the 

3 conversion of a substance by thermal, chemical, 

4 or other means to another substance with little 

5 or no carbon dioxide equivalent value and no 

6 ozone depletion potential. 

7 ‘‘(C) REGULATIONS.—The regulations pro8 mulgated under this paragraph shall include 

9 standards and protocols for project eligibility, 

10 certification of destroyers, monitoring, tracking, 

11 destruction efficiency, quantification of project 

12 and baseline emissions and carbon dioxide 

13 equivalent value, and verification. The Adminis14 trator shall ensure that destruction offset cred15 its represent real and verifiable destruction of 

16 chlorofluorocarbons or other class I or class II, 

17 group I, substances authorized under subpara18 graph (D). 

19 ‘‘(D) OTHER SUBSTANCES.—The Adminis20 trator may promulgate regulations to add to the 

21 list of class I and class II, group I, substances 

22 that may be destroyed for destruction offset 

23 credits, taking into account a candidate sub24 stance’s carbon dioxide equivalent value, ozone 

25 depletion potential, prevalence in banks in the 


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1 United States, and emission rates, as well as 

2 the need for additional cost containment under 

3 the class II, group II cap and the integrity of 

4 the class II, group II cap. The Administrator 

5 shall not add a class I or class II, group I sub6 stance to the list if the consumption of the sub7 stance has not been completely phased-out 

8 internationally (except for essential use exemp9 tions or other similar exemptions) pursuant to 

10 the Montreal Protocol. 

11 ‘‘(E) EXTENSION OF OFFSETS.—(i) At any 

12 time after the Administrator promulgates regu13 lations pursuant to subparagraph (A), the Ad14 ministrator may, pursuant to the requirements 

15 of part D of title VII and based on the carbon 

16 dioxide equivalent value of the substance de17 stroyed, add the types of destruction projects 

18 authorized to receive destruction offset credits 

19 under this paragraph to the list of types of 

20 projects eligible for offset credits under section 

21 733. If such projects are added to the list under 

22 section 733, the issuance of offset credits for 

23 such projects under part D of title VII shall be 

24 governed by the requirements of such part D, 

25 while the issuance of offset credits for such 


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1 projects under this paragraph shall be governed 

2 by the requirements of this paragraph. Nothing 

3 in this paragraph shall affect the issuance of 

4 offset credits under section 740. 

5 ‘‘(ii) The Administrator shall not make the 

6 addition under clause (i) unless the Adminis7 trator finds that insufficient destruction is oc8 curring or is projected to occur under this para9 graph and that the addition would increase de10 struction. 

11 ‘‘(iii) In no event shall more than one de12 struction offset credit be issued under title VII 

13 and this section for the destruction of the same 

14 quantity of a substance. 

15 ‘‘(10) LEGAL STATUS OF ALLOWANCES AND

16 CREDITS.—None of the following constitutes a prop17 erty right: 

18 ‘‘(A) A production or consumption allow19 ance. 

20 ‘‘(B) A destruction offset credit. 

21 ‘‘(c) DEADLINES FOR COMPLIANCE.—Notwith22 standing the deadlines specified for class II substances in 

23 sections 608, 609, 610, 612, and 613 that occur prior to 

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1 tions under those sections for class II, group II substances 

2 shall be January 1, 2012. 

3 ‘‘(d) EXCEPTIONS FOR ESSENTIAL USES.—Notwith4 standing any phase down of production and consumption 

5 required by this section, to the extent consistent with any 

6 applicable multilateral agreement to which the United 

7 States is a party or otherwise adheres, the Administrator 

8 may provide the following exceptions for essential uses: 

9 ‘‘(1) MEDICAL DEVICES.—The Administrator, 

10 after notice and opportunity for public comment, 

11 and in consultation with the Commissioner of the 

12 Food and Drug Administration, may provide an ex13 ception for the production and consumption of class 

14 II, group II substances solely for use in medical de15 vices. 

16 ‘‘(2) AVIATION AND SPACE VEHICLE SAFETY.— 

17 The Administrator, after notice and opportunity for 

18 public comment, may authorize the production and 

19 consumption of limited quantities of class II, group 

20 II substances solely for the purposes of aviation or 

21 space vehicle safety if either the Administrator of 

22 the Federal Aviation Administration or the Adminis23 trator of the National Aeronautics and Space Ad24 ministration, in consultation with the Administrator, 

25 determines that no safe and effective substitute has 


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1 been developed and that such authorization is nec2 essary for aviation or space flight safety purposes. 

3 ‘‘(e) DEVELOPING COUNTRIES.—Notwithstanding 

4 any phase down of production required by this section, the 

5 Administrator, after notice and opportunity for public 

6 comment, may authorize the production of limited quan7 tities of class II, group II substances in excess of the 

8 amounts otherwise allowable under this section solely for 

9 export to, and use in, developing countries. Any produc10 tion authorized under this subsection shall be solely for 

11 purposes of satisfying the basic domestic needs of such 

12 countries as provided in applicable international agree13 ments, if any, to which the United States is a party or 

14 otherwise adheres. 

15 ‘‘(f) NATIONAL SECURITY; FIRE SUPPRESSION, 

16 ETC.—The provisions of subsection (f) and paragraphs (1) 

17 and (2) of subsection (g) of section 604 shall apply to any 

18 consumption and production phase down of class II, group 

19 II substances in the same manner and to the same extent, 

20 consistent with any applicable international agreement to 

21 which the United States is a party or otherwise adheres, 

22 as such provisions apply to the substances specified in 

23 such subsection. 

24 ‘‘(g) ACCELERATED SCHEDULE.—In lieu of section 

25 606, the provisions of paragraphs (1), (2), and (3) of this 


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1 subsection shall apply in the case of class II, group II sub2 stances. 

3 ‘‘(1) IN GENERAL.—The Administrator shall 

4 promulgate initial regulations not later than 18 

5 months after the date of enactment of this section, 

6 and revised regulations any time thereafter, which 

7 establish a schedule for phasing down the consump8 tion (and, if the condition in subsection (b)(1)(B) is 

9 met, the production) of class II, group II substances 

10 that is more stringent than the schedule set forth in 

11 this section if, based on the availability of sub12 stitutes, the Administrator determines that such 

13 more stringent schedule is practicable, taking into 

14 account technological achievability, safety, and other 

15 factors the Administrator deems relevant, or if the 

16 Montreal Protocol, or any applicable international 

17 agreement to which the United States is a party or 

18 otherwise adheres, is modified or established to in19 clude a schedule or other requirements to control or 

20 reduce production, consumption, or use of any class 

21 II, group II substance more rapidly than the appli22 cable schedule under this section. 

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1 section in the same manner and subject to the same 

2 procedures as are provided in section 606(b). 

3 ‘‘(3) INCONSISTENCY.—If the Administrator de4 termines that the provisions of this section regarding 

5 banking, allowance rollover, or destruction offset 

6 credits create a significant potential for inconsist7 ency with the requirements of any applicable inter8 national agreement to which the United States is a 

9 party or otherwise adheres, the Administrator may 

10 promulgate regulations restricting the availability of 

11 banking, allowance rollover, or destruction offset 

12 credits to the extent necessary to avoid such incon13 sistency. 

14 ‘‘(h) EXCHANGE.—Section 607 shall not apply in the 

15 case of class II, group II substances. Production and con16 sumption allowances for class II, group II substances may 

17 be freely exchanged or sold but may not be converted into 

18 allowances for class II, group I substances. 

19 ‘‘(i) LABELING.—(1) In applying section 611 to prod20 ucts containing or manufactured with class II, group II 

21 substances, in lieu of the words ‘destroying ozone in the 

22 upper atmosphere’ on labels required under section 611 

23 there shall be substituted the words ‘contributing to global 

24 warming’. 


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1 ‘‘(2) The Administrator may, through rulemaking, 

2 exempt from the requirements of section 611 products 

3 containing or manufactured with class II, group II sub4 stances determined to have little or no carbon dioxide 

5 equivalent value compared to other substances used in 

6 similar products. 

7 ‘‘(j) NONESSENTIAL PRODUCTS.—For the purposes 

8 of section 610, class II, group II substances shall be regu9 lated under section 610(b), except that in applying section 

10 610(b) the word ‘hydrofluorocarbon’ shall be substituted 

11 for the word ‘chlorofluorocarbon’ and the term ‘class II, 

12 group II’ shall be substituted for the term ‘class I’. Class 

13 II, group II substances shall not be subject to the provi14 sions of section 610(d). 

15 ‘‘(k) INTERNATIONAL TRANSFERS.—In the case of 

16 class II, group II substances, in lieu of section 616, this 

17 subsection shall apply. To the extent consistent with any 

18 applicable international agreement to which the United 

19 States is a party or otherwise adheres, including any 

20 amendment to the Montreal Protocol, the United States 

21 may engage in transfers with other parties to such agree22 ment or amendment under the following conditions: 

23 ‘‘(1) The United States may transfer produc24 tion allowances to another party to such agreement 

25 or amendment if, at the time of the transfer, the 


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1 Administrator establishes revised production limits 

2 for the United States accounting for the transfer in 

3 accordance with regulations promulgated pursuant 

4 to this subsection. 

5 ‘‘(2) The United States may acquire production 

6 allowances from another party to such agreement or 

7 amendment if, at the time of the transfer, the Ad8 ministrator finds that the other party has revised its 

9 domestic production limits in the same manner as 

10 provided with respect to transfers by the United 

11 States in the regulations promulgated pursuant to 

12 this subsection. 

13 ‘‘(l) RELATIONSHIP TO OTHER LAWS.— 

14 ‘‘(1) STATE LAWS.—For purposes of section 

15 116, the requirements of this section for class II, 

16 group II substances shall be treated as requirements 

17 for the control and abatement of air pollution. 

18 ‘‘(2) MULTILATERAL AGREEMENTS.—Section 

19 614 shall apply to the provisions of this section con20 cerning class II, group II substances, except that for 

21 the words ‘Montreal Protocol’ there shall be sub22 stituted the words ‘Montreal Protocol, or any appli23 cable multilateral agreement to which the United 

24 States is a party or otherwise adheres that restricts 

25 the production or consumption of class II, group II 


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1 substances,’ and for the words ‘Article 4 of the Mon2 treal Protocol’ there shall be substituted ‘any provi3 sion of such multilateral agreement regarding trade 

4 with non-parties’. 

5 ‘‘(3) FEDERAL FACILITIES.—For purposes of 

6 section 118, the requirements of this section for 

7 class II, group II substances and corresponding 

8 State, interstate, and local requirements, administra9 tive authority, and process and sanctions shall be 

10 treated as requirements for the control and abate11 ment of air pollution within the meaning of section 

12 118. 

13 ‘‘(m) CARBON DIOXIDE EQUIVALENT VALUE.—(1) 

14 In lieu of section 602(e), the provisions of this subsection 

15 shall apply in the case of class II, group II substances. 

16 Simultaneously with establishing the list of class II, group 

17 II substances, and simultaneously with any addition to 

18 that list, the Administrator shall publish the carbon diox19 ide equivalent value of each listed class II, group II sub20 stance, based on a determination of the number of metric 

21 tons of carbon dioxide that makes the same contribution 

22 to global warming over 100 years as 1 metric ton of each 

23 class II, group II substance. 

24 ‘‘(2) Not later than February 1, 2017, and not less 

25 than every 5 years thereafter, the Administrator shall— 


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1 ‘‘(A) review, and if appropriate, revise the car2 bon dioxide equivalent values established for class II, 

3 group II substances based on a determination of the 

4 number of metric tons of carbon dioxide that makes 

5 the same contributions to global warming over 100 

6 years as 1 metric ton of each class II, group II sub7 stance; and 

8 ‘‘(B) publish in the Federal Register the results 

9 of that review and any revisions. 

10 ‘‘(3) A revised determination published in the Federal 

11 Register under paragraph (2)(B) shall take effect for pro12 duction of class II, group II substances, consumption of 

13 class II, group II substances, and importation of products 

14 containing class II, group II substances starting on Janu15 ary 1 of the first calendar year starting at least 9 months 

16 after the date on which the revised determination was pub17 lished. 

18 ‘‘(4) The Administrator may decrease the frequency 

19 of review and revision under paragraph (2) if the Adminis20 trator determines that such decrease is appropriate in 

21 order to synchronize such review and revisions with any 

22 similar review process carried out pursuant to the United 

23 Nations Framework Convention on Climate Change, an 

24 agreement negotiated under that convention, The Vienna 

25 Convention for the Protection of the Ozone Layer, or an 


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1 agreement negotiated under that convention, except that 

2 in no event shall the Administrator carry out such review 

3 and revision any less frequently than every 10 years. 

4 ‘‘(n) REPORTING REQUIREMENTS.—In lieu of sub5 sections (b) and (c) of section 603, paragraphs (1) and 

6 (2) of this subsection shall apply in the case of class II, 

7 group II substances: 

8 ‘‘(1) IN GENERAL.—On a quarterly basis, or 

9 such other basis (not less than annually) as deter10 mined by the Administrator, each person who pro11 duced, imported, or exported a class II, group II 

12 substance, or who imported a product containing a 

13 class II, group II substance, shall file a report with 

14 the Administrator setting forth the carbon dioxide 

15 equivalent amount of the substance that such person 

16 produced, imported, or exported, as well as the 

17 amount that was contained in products imported by 

18 that person, during the preceding reporting period. 

19 Each such report shall be signed and attested by a 

20 responsible officer. If all other reporting is complete, 

21 no such report shall be required from a person after 

22 April 1 of the calendar year after such person per23 manently ceases production, importation, and expor24 tation of the substance, as well as importation of 

25 products containing the substance, and so notifies 


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1 the Administrator in writing. If the United States 

2 becomes a party or otherwise adheres to a multilat3 eral agreement, including any amendment to the 

4 Montreal Protocol on Substances That Deplete the 

5 Ozone Layer, that restricts the production or con6 sumption of class II, group II substances, then, if all 

7 other reporting is complete, no such report shall be 

8 required from a person with respect to importation 

9 from parties to such agreement or amendment of 

10 products containing any class II, group II substance 

11 restricted by such agreement or amendment, after 

12 April 1 of the calendar year following the year dur13 ing which such agreement or amendment enters into 

14 force. 

15 ‘‘(2) BASELINE REPORTS FOR CLASS II, GROUP

16 II SUBSTANCES.— 

17 ‘‘(A) IN GENERAL.—Unless such informa18 tion has been previously reported to the Admin19 istrator, on the date on which the first report 

20 under paragraph (1) of this subsection is re21 quired to be filed, each person who produced, 

22 imported, or exported a class II, group II sub23 stance, or who imported a product containing a 

24 class II substance, (other than a substance 

25 added to the list of class II, group II substances 


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1 after the publication of the initial list of such 

2 substances under this section), shall file a re3 port with the Administrator setting forth the 

4 amount of such substance that such person pro5 duced, imported, exported, or that was con6 tained in products imported by that person, 

7 during each of calendar years 2004, 2005, and 

8 2006. 

9 ‘‘(B) PRODUCERS.—In reporting under 

10 subparagraph (A), each person who produced in 

11 the United States a class II substance during 

12 calendar years 2004, 2005, or 2006 shall— 

13 ‘‘(i) report all acquisitions or pur14 chases of class II substances during each 

15 of calendar years 2004, 2005, and 2006 

16 from all other persons who produced in the 

17 United States a class II substance during 

18 calendar years 2004, 2005, or 2006, and 

19 supply evidence of such acquisitions and 

20 purchases as deemed necessary by the Ad21 ministrator; and 

22 ‘‘(ii) report all transfers or sales of 

23 class II substances during each of calendar 

24 years 2004, 2005, and 2006 to all other 

25 persons who produced in the United States 


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1 a class II substance during calendar years 

2 2004, 2005, or 2006, and supply evidence 

3 of such transfers and sales as deemed nec4 essary by the Administrator. 

5 ‘‘(C) ADDED SUBSTANCES.—In the case of 

6 a substance added to the list of class II, group 

7 II substances after publication of the initial list 

8 of such substances under this section, each per9 son who produced, imported, exported, or im10 ported products containing such substance in 

11 calendar year 2004, 2005, or 2006 shall file a 

12 report with the Administrator within 180 days 

13 after the date on which such substance is added 

14 to the list, setting forth the amount of the sub15 stance that such person produced, imported, 

16 and exported, as well as the amount that was 

17 contained in products imported by that person, 

18 in calendar years 2004, 2005, and 2006. 

19 ‘‘(o) STRATOSPHERIC OZONE AND CLIMATE PROTEC20 TION FUND.— 

21 ‘‘(1) IN GENERAL.—There is established in the 

22 Treasury of the United States a Stratospheric Ozone 

23 and Climate Protection Fund. 

24 ‘‘(2) DEPOSITS.—The Administrator shall de25 posit all proceeds from the auction and non-auction 


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1 sale of allowances under this section into the Strato2 spheric Ozone and Climate Protection Fund. 

3 ‘‘(3) USE.—Amounts deposited into the Strato4 spheric Ozone and Climate Protection Fund shall be 

5 available, subject to appropriations, exclusively for 

6 the following purposes: 

7 ‘‘(A) RECOVERY, RECYCLING, AND REC8 LAMATION.—The Administrator may utilize 

9 funds to establish a program to incentivize the 

10 recovery, recycling, and reclamation of any 

11 Class II substances in order to reduce emissions 

12 of such substances. 

13 ‘‘(B) MULTILATERAL FUND.—If the 

14 United States becomes a party or otherwise ad15 heres to a multilateral agreement, including any 

16 amendment to the Montreal Protocol on Sub17 stances That Deplete the Ozone Layer, which 

18 restricts the production or consumption of class 

19 II, group II substances, the Administrator may 

20 utilize funds to meet any related contribution 

21 obligation of the United States to the Multilat22 eral Fund for the Implementation of the Mon23 treal Protocol or similar multilateral fund es24 tablished under such multilateral agreement. 


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1 ‘‘(C) BEST-IN-CLASS APPLIANCES DEPLOY2 MENT PROGRAM.—The Secretary of Energy is 

3 authorized to utilize funds to carry out the pur4 poses of section 214 of the American Clean En5 ergy and Security Act of 2009. 

6 ‘‘(D) LOW GLOBAL WARMING PRODUCT

7 TRANSITION ASSISTANCE PROGRAM.— 

8 ‘‘(i) IN GENERAL.—The Adminis9 trator, in consultation with the Secretary 

10 of Energy, may utilize funds in fiscal years 

11 2012 through 2022 to establish a program 

12 to provide financial assistance to manufac13 turers of products containing class II, 

14 group II substances to facilitate the transi15 tion to products that contain or utilize al16 ternative substances with no or low carbon 

17 dioxide equivalent value and no ozone de18 pletion potential. 

19 ‘‘(ii) DEFINITION.—In this subpara20 graph, the term ‘products’ means refrig21 erators, freezers, dehumidifiers, air condi22 tioners, foam insulation, technical aerosols, 

23 fire protection systems, and semiconduc24 tors. 


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1 ‘‘(iii) FINANCIAL ASSISTANCE.—The 

2 Administrator may provide financial assist3 ance to manufacturers pursuant to clause 

4 (i) for— 

5 ‘‘(I) the design and configuration 

6 of new products that use alternative 

7 substances with no or low carbon di8 oxide equivalent value and no ozone 

9 depletion potential; and 

10 ‘‘(II) the redesign and retooling 

11 of facilities for the manufacture of 

12 products in the United States that use 

13 alternative substances with no or low 

14 carbon dioxide equivalent value and 

15 no ozone depletion potential. 

16 ‘‘(iv) REPORTS.—For any fiscal year 

17 during which the Administrator provides 

18 financial assistance pursuant to this sub19 paragraph, the Administrator shall submit 

20 a report to the Congress within 3 months 

21 of the end of such fiscal year detailing the 

22 amounts, recipients, specific purposes, and 

23 results of the financial assistance pro24 vided.’’. 


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1 (b) TABLE OF CONTENTS.—The table of contents of 

2 title VI of the Clean Air Act (42 U.S.C. 7671 et seq.) 

3 is amended by adding the following new item at the end 

4 thereof: 

‘‘Sec. 619. Hydrofluorocarbons (HFCs).’’. 

5 (c) FIRE SUPPRESSION AGENTS.—Section 605(a) of 

6 the Clean Air Act (42 U.S.C. 7671(a)) is amended— 

7 (1) by striking ‘‘or’’ at the end of paragraph 

8 (2); 

9 (2) by striking the period at the end of para10 graph (3) and inserting ‘‘; or’’; and 

11 (3) by adding the following new paragraph after 

12 paragraph (3): 

13 ‘‘(4) is listed as acceptable for use as a fire sup14 pression agent for nonresidential applications in ac15 cordance with section 612(c).’’. 

16 (d) MOTOR VEHICLE AIR CONDITIONERS.— 

17 (1) Section 609(e) of the Clean Air Act (42 

18 U.S.C. 7671h(e)) is amended by inserting ‘‘, group 

19 I’’ after each reference to ‘‘class II’’ in the text and 

20 heading. 

21 (2) Section 609 of the Clean Air Act (42 U.S.C. 

22 7671h) is amended by adding the following new sub23 section after subsection (e): 

24 ‘‘(f) CLASS II, GROUP II SUBSTANCES.— 


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1 ‘‘(1) REPAIR.—The Administrator may promul2 gate regulations establishing requirements for repair 

3 of motor vehicle air conditioners prior to adding a 

4 class II, group II substance. 

5 ‘‘(2) SMALL CONTAINERS.—(A) The Adminis6 trator may promulgate regulations establishing serv7 icing practices and procedures for recovery of class 

8 II, group II substances from containers which con9 tain less than 20 pounds of such class II, group II 

10 substances. 

11 ‘‘(B) Not later than 18 months after enactment 

12 of this subsection, the Administrator shall either 

13 promulgate regulations requiring that containers 

14 which contain less than 20 pounds of a class II, 

15 group II substance be equipped with a device or 

16 technology that limits refrigerant emissions and 

17 leaks from the container and limits refrigerant emis18 sions and leaks during the transfer of refrigerant 

19 from the container to the motor vehicle air condi20 tioner or issue a determination that such require21 ments are not necessary or appropriate. 

22 ‘‘(C) Not later than 18 months after enactment 

23 of this subsection, the Administrator shall promul24 gate regulations establishing requirements for con25 sumer education materials on best practices associVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00840 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ated with the use of containers which contain less 

2 than 20 pounds of a class II, group II substance and 

3 prohibiting the sale or distribution, or offer for sale 

4 or distribution, of any class II, group II substance 

5 in any container which contains less than 20 pounds 

6 of such class II, group II substance, unless con7 sumer education materials consistent with such re8 quirements are displayed and available at point-of9 sale locations, provided to the consumer, or included 

10 in or on the packaging of the container which con11 tain less than 20 pounds of a class II, group II sub12 stance. 

13 ‘‘(D) The Administrator may, through rule14 making, extend the requirements established under 

15 this paragraph to containers which contain 30 

16 pounds or less of a class II, group II substance if 

17 the Administrator determines that such action would 

18 produce significant environmental benefits. 

19 ‘‘(3) RESTRICTION OF SALES.—Effective Janu20 ary 1, 2014, no person may sell or distribute or offer 

21 to sell or distribute or otherwise introduce into inter22 state commerce any motor vehicle air conditioner re23 frigerant in any size container unless the substance 

24 has been found acceptable for use in a motor vehicle 

25 air conditioner under section 612.’’. 


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1 (e) SAFE ALTERNATIVES POLICY.—Section 612(e) of 

2 the Clean Air Act (42 U.S.C. 7671k(e)) is amended by 

3 inserting ‘‘or class II’’ after each reference to ‘‘class I’’. 

4 SEC. 333. BLACK CARBON. 

5 (a) DEFINITION.—As used in this section, the term 

6 ‘‘black carbon’’ means primary light absorbing aerosols, 

7 as defined by the Administrator, based on the best avail8 able science. 

9 (b) BLACK CARBON ABATEMENT REPORT.—Not 

10 later than one year after the date of enactment of this 

11 section, the Administrator shall, in consultation with other 

12 appropriate Federal agencies, submit to Congress a report 

13 regarding black carbon emissions. The report shall include 

14 the following: 

15 (1) A summary of the current information and 

16 research that identifies— 

17 (A) an inventory of the major sources of 

18 black carbon emissions in the United States 

19 and throughout the world, including— 

20 (i) an estimate of the quantity of cur21 rent and projected future emissions; and 

22 (ii) the net climate forcing of the 

23 emissions from such sources, including 

24 consideration of co-emissions of other pol25 lutants; 


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1 (B) effective and cost-effective control 

2 technologies, operations, and strategies for ad3 ditional domestic and international black carbon 

4 emissions reductions, such as diesel retrofit 

5 technologies on existing on-road, non-road, and 

6 stationary engines and programs to address res7 idential cookstoves, and forest and agriculture8 based burning; 

9 (C) potential metrics and approaches for 

10 quantifying the climatic effects of black carbon 

11 emissions, including its radiative forcing and 

12 warming effects, that may be used to compare 

13 the climate benefits of different mitigation 

14 strategies, including an assessment of the un15 certainty in such metrics and approaches; and 

16 (D) the public health and environmental 

17 benefits associated with additional controls for 

18 black carbon emissions. 

19 (2) Recommendations regarding— 

20 (A) development of additional emissions 

21 monitoring techniques and capabilities, mod22 eling, and other black carbon-related areas of 

23 study; 

24 (B) areas of focus for additional study of 

25 technologies, operations, and strategies with the 


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1 greatest potential to reduce emissions of black 

2 carbon and associated public health, economic, 

3 and environmental impacts associated with 

4 these emissions; and 

5 (C) actions, in addition to those identified 

6 by the Administrator under section 851 of the 

7 Clean Air Act (as added by subsection (c)), the 

8 Federal Government may take to encourage or 

9 require reductions in black carbon emissions. 

10 (c) BLACK CARBON MITIGATION.—Title VIII of the 

11 Clean Air Act, as added by section 331 of this Act, and 

12 amended by section 222 of this Act, is further amended 

13 by adding after part D the following new part: 

14 ‘‘PART E—BLACK CARBON 

15 ‘‘SEC. 851. BLACK CARBON. 

16 ‘‘(a) DOMESTIC BLACK CARBON MITIGATION.—Not 

17 later than 18 months after the date of enactment of this 

18 section, the Administrator, taking into consideration the 

19 public health and environmental impacts of black carbon 

20 emissions, including the effects on global and regional 

21 warming, the Arctic, and other snow and ice-covered sur22 faces, shall propose regulations under the existing authori23 ties of this Act to reduce emissions of black carbon or pro24 pose a finding that existing regulations promulgated pur25 suant to this Act adequately regulate black carbon emisVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00844 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 sions. Not later than two years after the date of enactment 

2 of this section, the Administrator shall promulgate final 

3 regulations under the existing authorities of this Act or 

4 finalize the proposed finding. Such regulations shall not 

5 apply to specific types, classes, categories, or other suit6 able groupings of emissions sources that the Adminis7 trator finds are subject to adequate regulation. 

8 ‘‘(b) INTERNATIONAL BLACK CARBON MITIGA9 TION.— 

10 ‘‘(1) REPORT.—Not later than one year after 

11 the date of enactment of this section, the Adminis12 trator, in coordination with the Secretary of State 

13 and other appropriate Federal agencies, shall trans14 mit a report to Congress on the amount, type, and 

15 direction of all present United States financial, tech16 nical, and related assistance to foreign countries to 

17 reduce, mitigate, and otherwise abate black carbon 

18 emissions. 

19 ‘‘(2) OTHER OPPORTUNITIES.—The report re20 quired under paragraph (1) shall also identify oppor21 tunities and recommendations, including action 

22 under existing authorities, to achieve significant 

23 black carbon emission reductions in foreign countries 

24 through technical assistance or other approaches 

25 to— 


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1 ‘‘(A) promote sustainable solutions to 

2 bring clean, efficient, safe, and affordable 

3 stoves, fuels, or both stoves and fuels to resi4 dents of developing countries that are reliant on 

5 solid fuels such as wood, dung, charcoal, coal, 

6 or crop residues for home cooking and heating, 

7 so as to help reduce the public health, environ8 mental, and economic impacts of black carbon 

9 emissions from these sources by— 

10 ‘‘(i) identifying key regions for large11 scale demonstration efforts, and key part12 ners in each such region; and 

13 ‘‘(ii) developing for each such region a 

14 large-scale implementation strategy with a 

15 goal of collectively reaching 20,000,000 

16 homes over 5 years with interventions that 

17 will— 

18 ‘‘(I) increase stove efficiency by 

19 over 50 percent (or such other goal as 

20 determined by the Administrator); 

21 ‘‘(II) reduce emissions of black 

22 carbon by over 60 percent (or such 

23 other goal as determined by the Ad24 ministrator); and 


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1 ‘‘(III) reduce the incidence of se2 vere pneumonia in children under 5 

3 years old by over 30 percent (or such 

4 other goal as determined by the Ad5 ministrator); 

6 ‘‘(B) make technological improvements to 

7 diesel engines and provide greater access to 

8 fuels that emit less or no black carbon; 

9 ‘‘(C) reduce unnecessary agricultural or 

10 other biomass burning where feasible alter11 natives exist; 

12 ‘‘(D) reduce unnecessary fossil fuel burn13 ing that produces black carbon where feasible 

14 alternatives exist; 

15 ‘‘(E) reduce other sources of black carbon 

16 emissions; and 

17 ‘‘(F) improve capacity to achieve greater 

18 compliance with existing laws to address black 

19 carbon emissions.’’. 

20 (d) AUTHORIZATION OF APPROPRIATIONS.—There 

21 are authorized to be appropriated such sums as are nec22 essary to carry out this section. 

23 SEC. 334. STATES. 

24 Section 116 of the Clean Air Act (42 U.S.C. 7416) 

25 is amended by adding the following at the end thereof: 


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1 ‘‘For the purposes of this section, the phrases ‘standard 

2 or limitation respecting emissions of air pollutants’ and 

3 ‘requirements respecting control or abatement of air pollu4 tion’ shall include any provision to: cap greenhouse gas 

5 emissions, require surrender to the State or a political 

6 subdivision thereof of emission allowances or offset credits 

7 established or issued under this Act, and require the use 

8 of such allowances or credits as a means of demonstrating 

9 compliance with requirements established by a State or 

10 political subdivision thereof.’’. 

11 SEC. 335. STATE PROGRAMS. 

12 Title VIII of the Clean Air Act, as added by section 

13 331 of this Act and amended by several sections of this 

14 Act, is further amended by adding after part E (as added 

15 by section 333(c) of this Act) the following new part: 

16 ‘‘PART F—MISCELLANEOUS 

17 ‘‘SEC. 861. STATE PROGRAMS. 

18 ‘‘Notwithstanding section 116, no State or political 

19 subdivision thereof shall implement or enforce a cap and 

20 trade program that covers any capped emissions emitted 

21 during the years 2012 through 2017. For purposes of this 

22 section, the term ‘cap and trade program’ means a system 

23 of greenhouse gas regulation under which a State or polit24 ical subdivision issues a limited number of tradable instru25 ments in the nature of emission allowances and requires 


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1 that sources within its jurisdiction surrender such 

2 tradeable instruments for each unit of greenhouse gases 

3 emitted during a compliance period. For purposes of this 

4 section, a ‘cap-and-trade program’ does not include a tar5 get or limit on greenhouse gas emissions adopted by a 

6 State or political subdivision that is implemented other 

7 than through the issuance and surrender of a limited num8 ber of tradable instruments in the nature of emission al9 lowances, nor does it include any other standard, limit, 

10 regulation, or program to reduce greenhouse gas emissions 

11 that is not implemented through the issuance and sur12 render of a limited number of tradeable instruments in 

13 the nature of emission allowances. For purposes of this 

14 section, the term ‘cap and trade program’ does not in15 clude, among other things, fleet-wide motor vehicle emis16 sion requirements that allow greater emissions with in17 creased vehicle production, or requirements that fuels, or 

18 other products, meet an average pollution emission rate 

19 or lifecycle greenhouse gas standard. 

20 ‘‘SEC. 862. GRANTS FOR SUPPORT OF AIR POLLUTION CON21 TROL PROGRAMS. 

22 ‘‘The Administrator is authorized to make grants to 

23 air pollution control agencies pursuant to section 105 for 

24 purposes of assisting in the implementation of programs 


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1 to address global warming established under the Safe Cli2 mate Act.’’. 

3 SEC. 336. ENFORCEMENT. 

4 (a) REMAND.—Section 307(b) of the Clean Air Act 

5 (42 U.S.C. 7607(b)) is amended by adding the following 

6 new paragraphs at the end thereof: 

7 ‘‘(3) If the court determines that any action of 

8 the Administrator is arbitrary, capricious, or other9 wise unlawful, the court may remand such action, 

10 without vacatur, if vacatur would impair or delay 

11 protection of the environment or public health or 

12 otherwise undermine the timely achievement of the 

13 purposes of this Act. 

14 ‘‘(4) If the court determines that any action of 

15 the Administrator is arbitrary, capricious, or other16 wise unlawful, and remands the matter to the Ad17 ministrator, the Administrator shall complete final 

18 action on remand within an expeditious time period 

19 no longer than the time originally allowed for the ac20 tion or one year, whichever is less, unless the court 

21 on motion determines that a shorter or longer period 

22 is necessary, appropriate, and consistent with the 

23 purposes of this Act. The court of appeals shall have 

24 jurisdiction to enforce a deadline for action on re25 mand under this subparagraph.’’. 


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1 (b) PETITION FOR RECONSIDERATION.—Section 

2 307(d)(7)(B) of the Clean Air Act (42 U.S.C. 

3 7607(d)(7)(B)) is amended as follows: 

4 (1) By inserting after the second sentence ‘‘If 

5 a petition for reconsideration is filed, the Adminis6 trator shall take final action on such petition, in7 cluding promulgation of final action either revising 

8 or determining not to revise the action for which re9 consideration is sought, within 150 days after the 

10 petition is received by the Administrator or the peti11 tion shall be deemed denied for the purpose of judi12 cial review.’’. 

13 (2) By amending the third sentence to read as 

14 follows: ‘‘Such person may seek judicial review of 

15 such denial, or of any other final action, by the Ad16 ministrator, in response to a petition for reconsider17 ation, in the United States court of appeals for the 

18 appropriate circuit (as provided in subsection (b)).’’. 

19 SEC. 337. CONFORMING AMENDMENTS. 

20 (a) FEDERAL ENFORCEMENT.—Section 113 of the 

21 Clean Air Act (42 U.S.C. 7413) is amended as follows: 

22 (1) In subsection (a)(3), by striking ‘‘or title 

23 VI,’’ and inserting ‘‘title VI, title VII, or title VIII’’. 

24 (2) In subsection (b), by striking ‘‘or a major 

25 stationary source’’ and inserting ‘‘a major stationary 


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1 source, or a covered EGU under title VIII’’ in the 

2 material preceding paragraph (1). 

3 (3) In paragraph (2) of subsection (b), by strik4 ing ‘‘or title VI’’ and inserting ‘‘title VI, title VII, 

5 or title VIII’’. 

6 (4) In subsection (c)— 

7 (A) in the first sentence of paragraph (1), 

8 by striking ‘‘or title VI (relating to strato9 spheric ozone control),’’ and inserting ‘‘title VI, 

10 title VII, or title VIII,’’; and 

11 (B) in the first sentence of paragraph (3), 

12 by striking ‘‘or VI’’ and inserting ‘‘VI, VII, or 

13 VIII’’. 

14 (5) In subsection (d)(1)(B), by striking ‘‘or VI’’ 

15 and inserting ‘‘VI, VII, or VIII’’. 

16 (6) In subsection (f), in the first sentence, by 

17 striking ‘‘or VI’’ and inserting ‘‘VI, VII, or VIII’’. 

18 (b) RETENTION OF STATE AUTHORITY.—Section 

19 116 of the Clean Air Act (42 U.S.C. 7416) is amended 

20 as follows: 

21 (1) By striking ‘‘and 233’’ and inserting ‘‘233’’. 

22 (2) By striking ‘‘of moving sources)’’ and in23 serting ‘‘of moving sources), and 861 (preempting 

24 certain State greenhouse gas programs for a limited 

25 time)’’. 


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1 (c) INSPECTIONS, MONITORING, AND ENTRY.—Sec2 tion 114(a) of the Clean Air Act (42 U.S.C. 7414(a)) is 

3 amended by striking ‘‘section 112,’’ and all that follows 

4 through ‘‘(ii)’’ and inserting the following: ‘‘section 112, 

5 or any regulation of greenhouse gas emissions under title 

6 VII or VIII, (ii)’’. 

7 (d) ENFORCEMENT.—Subsection (f) of section 304 of 

8 the Clean Air Act (42 U.S.C. 7604(f)) is amended as fol9 lows: 

10 (1) By striking ‘‘; or’’ at the end of paragraph 

11 (3) thereof and inserting a comma. 

12 (2) By striking the period at the end of para13 graph (4) thereof and inserting ‘‘, or’’. 

14 (3) By adding the following after paragraph (4) 

15 thereof: 

16 ‘‘(5) any requirement of title VII or VIII.’’. 

17 (e) ADMINISTRATIVE PROCEEDINGS AND JUDICIAL

18 REVIEW.—Section 307 of the Clean Air Act (42 U.S.C. 

19 7607) is amended as follows: 

20 (1) In subsection (a), by striking ‘‘, or section 

21 306’’ and inserting ‘‘section 306, or title VII or 

22 VIII’’. 

23 (2) In subsection (b)(1)— 

24 (A) by striking ‘‘,,’’ and inserting ‘‘,’’ in 

25 each place such punctuation appears; and 


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1 (B) by striking ‘‘section 120,’’ in the first 

2 sentence and inserting ‘‘section 120, any final 

3 action under title VII or VIII,’’. 

4 (3) In subsection (d)(1) by amending subpara5 graph (S) to read as follows: 

6 ‘‘(S) the promulgation or revision of any 

7 regulation under title VII or VIII,’’. 

8 SEC. 338. DAVIS-BACON COMPLIANCE. 

9 (a) IN GENERAL.—Notwithstanding any other provi10 sion of law and in a manner consistent with other provi11 sions in this Act, to receive emission allowances or funding 

12 under this Act, or the amendments made by this Act, the 

13 recipient shall provide reasonable assurances that all la14 borers and mechanics employed by contractors and sub15 contractors on projects funded directly by or assisted in 

16 whole or in part by and through the Federal Government 

17 pursuant to this Act, or the amendments made by this 

18 Act, or by any entity established in accordance with this 

19 Act, or the amendments made by this Act, including the 

20 Carbon Storage Research Corporation, will be paid wages 

21 at rates not less than those prevailing on projects of a 

22 character similar in the locality as determined by the Sec23 retary of Labor in accordance with subchapter IV of chap24 ter 31 of title 40, United States Code (commonly known 

25 as the ‘‘Davis-Bacon Act’’). With respect to the labor 


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1 standards specified in this section, the Secretary of Labor 

2 shall have the authority and functions set forth in Reorga3 nization Plan Numbered 14 of 1950 (64 Stat. 1267; 5 

4 U.S.C. App.) and section 3145 of title 40, United States 

5 Code. 

6 (b) EXEMPTION.—Neither subsection (a) nor the re7 quirements of subchapter IV of chapter 31 of title 40, 

8 United States Code, shall apply to retrofitting of the fol9 lowing: 

10 (1) Single family homes (both attached and de11 tached) under section 202. 

12 (2) Owner-occupied residential units in larger 

13 buildings that have their own dedicated space-condi14 tioning systems under section 202. 

15 (3) Residential buildings (as defined in section 

16 202(a)(5)) if designed for residential use by less 

17 than 4 families. 

18 (4) Nonresidential buildings (as defined in sec19 tion 202(a)(1)) if the net interior space of such non20 residential building is less than 6,500 square feet. 

21 SEC. 339. NATIONAL STRATEGY FOR DOMESTIC BIOLOGI22 CAL CARBON SEQUESTRATION. 

23 Not later than 1 year after the date of enactment 

24 of this Act, the Administrator of the Environmental Pro25 tection Agency, in consultation with the Secretary of EnVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00855 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ergy, the Secretary of Agriculture, the Secretary of the 

2 Interior, and the heads of such other relevant Federal 

3 agencies as the President may designate, shall submit to 

4 Congress a report setting forth a unified and comprehen5 sive strategy to address the key legal, regulatory, techno6 logical, and other barriers to maximizing the potential for 

7 sustainable biological sequestration of carbon within the 

8 United States. 

9 Subtitle D—Carbon Market 

10 Assurance 

11 SEC. 341. CARBON MARKET ASSURANCE. 

12 (a) AMENDMENT.—The Federal Power Act (16 

13 U.S.C. 791a and following) is amended by adding at the 

14 end the following: 

15 ‘‘PART IV—CARBON MARKET ASSURANCE 

16 ‘‘SEC. 401. OVERSIGHT AND ASSURANCE OF CARBON MAR17 KETS. 

18 ‘‘(a) DEFINITIONS.—In this section: 

19 ‘‘(1) CONTRACT OF SALE.—The term ‘contract 

20 of sale’ includes sales, agreements of sale, and 

21 agreements to sell. 

22 ‘‘(2) COVERED ENTITY.—The term ‘covered en23 tity’ shall have the meaning given in section 700 of 

24 the Clean Air Act. 


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1 ‘‘(3) FUTURE DELIVERY.—The term ‘future de2 livery’ does not include any sale of any cash com3 modity for deferred shipment or delivery. 

4 ‘‘(4) OFFSET CREATION CONTRACT.—The term 

5 ‘offset creation contract’ mean a written agreement 

6 for the origination and development of an offset 

7 project, and the related issuance of offset credits, 

8 pursuant to title VII of the Clean Air Act. 

9 ‘‘(5) REGULATED ALLOWANCE.—The term ‘reg10 ulated allowance’ means any emission allowance, 

11 compensatory allowance, offset credit, or Federal re12 newable electricity credit established or issued under 

13 the American Clean Energy and Security Act of 

14 2009. 

15 ‘‘(6) REGULATED ALLOWANCE DERIVATIVE.— 

16 The term ‘regulated allowance derivative’ means an 

17 instrument that is, or includes, an instrument— 

18 ‘‘(A) which— 

19 ‘‘(i) is of the character of, or is com20 monly known to the trade as, a ‘put op21 tion’, ‘call option’, ‘privilege’, ‘indemnity’, 

22 ‘advance guaranty’, ‘decline guaranty’, or 

23 ‘swap agreement’; or 


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1 ‘‘(ii) is a contract of sale for future 

2 delivery other than an offset creation con3 tract; and 

4 ‘‘(B) the value of which, in whole or in 

5 part, is expressly linked to the price of a regu6 lated allowance or another regulated allowance 

7 derivative. 

8 ‘‘(7) REGULATED INSTRUMENT.—The term 

9 ‘regulated instrument’ means a regulated allowance 

10 or a regulated allowance derivative. 

11 ‘‘(b) REGULATED ALLOWANCE MARKET.— 

12 ‘‘(1) AUTHORITY.—The Commission shall pro13 mulgate regulations for the establishment, operation, 

14 and oversight of markets for regulated allowances 

15 not later than 18 months after the date of the enact16 ment of this section, and from time to time there17 after as may be appropriate. 

18 ‘‘(2) REGULATIONS.—The regulations promul19 gated pursuant to paragraph (1) shall— 

20 ‘‘(A) provide for effective and comprehen21 sive market oversight; 

22 ‘‘(B) prohibit fraud, market manipulation 

23 (including an entity’s fraudulent or manipula24 tive conduct with respect to regulated allowance 

25 derivatives that benefits the entity in regulated 


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1 allowance markets), and excess speculation, and 

2 provide measures to limit unreasonable fluctua3 tion in the prices of regulated allowances; 

4 ‘‘(C) facilitate compliance with title VII of 

5 the Clean Air Act by covered entities; 

6 ‘‘(D) ensure market transparency and rec7 ordkeeping deemed necessary and appropriate 

8 by the Commission to provide for efficient price 

9 discovery; prevention of fraud, market manipu10 lation, and excess speculation; and compliance 

11 with title VII of the Clean Air Act and section 

12 610 of the Public Utility Regulatory Policies 

13 Act of 1978; 

14 ‘‘(E) as necessary, ensure that position 

15 limitations for individual market participants 

16 are established with respect to each class of 

17 regulated allowances; 

18 ‘‘(F) as necessary, ensure that margin re19 quirements are established for each class of reg20 ulated allowances; 

21 ‘‘(G) provide for the formation and oper22 ation of a fair, orderly and liquid national mar23 ket system that allows for the best execution in 

24 the trading of regulated allowances; 


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1 ‘‘(H) limit or eliminate counterparty risks, 

2 market power concentration risks, and other 

3 risks associated with over-the-counter trading; 

4 and 

5 ‘‘(I) establish standards for qualification 

6 as, and operation of, trading facilities for regu7 lated allowances; 

8 ‘‘(J) establish standards for qualification 

9 as, and operation of, clearing organizations for 

10 trading facilities for regulated allowances; and 

11 ‘‘(K) include such other requirements as 

12 necessary to preserve market integrity and fa13 cilitate compliance with title VII of the Clean 

14 Air Act and section 610 of the Public Utility 

15 Regulatory Policies Act of 1978 and the regula16 tions promulgated under such title and such 

17 section. 

18 ‘‘(3) ENFORCEMENT.— 

19 ‘‘(A) IN GENERAL.—If the Commission de20 termines, after notice and an opportunity for a 

21 hearing on the record, that any entity has vio22 lated any rule or order issued by the Commis23 sion under this subsection, the Commission may 

24 issue an order— 


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1 ‘‘(i) prohibiting the entity from trad2 ing on a trading facility for regulated al3 lowances registered with the Commission, 

4 and requiring all such facilities to refuse 

5 the entity all privileges for such period as 

6 may be specified in the order; 

7 ‘‘(ii) if the entity is registered with 

8 the Commission in any capacity, sus9 pending for a period of not more than 6 

10 months, or revoking, the registration of the 

11 entity; 

12 ‘‘(iii) assessing the entity a civil pen13 alty of not more than $1,000,000 per day 

14 per violation for as long as the violation 

15 continues (and in determining the amount 

16 of a civil penalty, the Commission shall 

17 take into account the nature and serious18 ness of the violation and the efforts to 

19 remedy the violation); and 

20 ‘‘(iv) requiring disgorgement of unjust 

21 profits, restitution to entities harmed by 

22 the violation as determined by the Com23 mission, or both. 

24 ‘‘(B) AUTHORITY TO SUSPEND OR REVOKE

25 REGISTRATION.—The Commission may suspend 


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1 for a period of not more than 6 months, or re2 voke, the registration of a trading facility for 

3 regulated allowances or of a clearing organiza4 tion registered by the Commission if, after no5 tice and opportunity for a hearing on the 

6 record, the Commission finds that— 

7 ‘‘(i) the entity violated any rule or 

8 order issued by the Commission under this 

9 subsection; or 

10 ‘‘(ii) a director, officer, employee, or 

11 agent of the entity has violated any rule or 

12 order issued by the Commission under this 

13 subsection. 

14 ‘‘(C) CEASE AND DESIST PROCEEDINGS.— 

15 ‘‘(i) IN GENERAL.—If the Commission 

16 determines that any entity may be vio17 lating, may have violated, or may be about 

18 to violate any provision of this part, or any 

19 regulation promulgated by, or any restric20 tion, condition, or order made or imposed 

21 by, the Commission under this Act, and if 

22 the Commission finds that the alleged vio23 lation or threatened violation, or the con24 tinuation of the violation, is likely to result 

25 in significant harm to covered entities or 


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1 market participants, or significant harm to 

2 the public interest, the Commission may 

3 issue a temporary order requiring the enti4 ty— 

5 ‘‘(I) to cease and desist from the 

6 violation or threatened violation; 

7 ‘‘(II) to take such action as is 

8 necessary to prevent the violation or 

9 threatened violation; and 

10 ‘‘(III) to prevent, as the Commis11 sion determines to be appropriate— 

12 ‘‘(aa) significant harm to 

13 covered entities or market par14 ticipants; 

15 ‘‘(bb) significant harm to 

16 the public interest; and 

17 ‘‘(cc) frustration of the abil18 ity of the Commission to conduct 

19 the proceedings or to redress the 

20 violation at the conclusion of the 

21 proceedings. 

22 ‘‘(ii) TIMING OF ENTRY.—An order 

23 issued under clause (i) shall be entered 

24 only after notice and opportunity for a 

25 hearing, unless the Commission determines 


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1 that notice and hearing before entry would 

2 be impracticable or contrary to the public 

3 interest. 

4 ‘‘(iii) EFFECTIVE DATE.—A tem5 porary order issued under clause (i) 

6 shall— 

7 ‘‘(I) become effective upon serv8 ice upon the entity; and 

9 ‘‘(II) unless set aside, limited, or 

10 suspended by the Commission or a 

11 court of competent jurisdiction, re12 main effective and enforceable pend13 ing the completion of the proceedings. 

14 ‘‘(D) PROCEEDINGS REGARDING DISSIPA15 TION OR CONVERSION OF ASSETS.— 

16 ‘‘(i) IN GENERAL.—In a proceeding 

17 involving an alleged violation of a regula18 tion or order promulgated or issued by the 

19 Commission, if the Commission determines 

20 that the alleged violation or related cir21 cumstances are likely to result in signifi22 cant dissipation or conversion of assets, 

23 the Commission may issue a temporary 

24 order requiring the respondent to take 


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1 such action as is necessary to prevent the 

2 dissipation or conversion of assets. 

3 ‘‘(ii) TIMING OF ENTRY.—An order 

4 issued under clause (i) shall be entered 

5 only after notice and opportunity for a 

6 hearing, unless the Commission determines 

7 that notice and hearing before entry would 

8 be impracticable or contrary to the public 

9 interest. 

10 ‘‘(iii) EFFECTIVE DATE.—A tem11 porary order issued under clause (i) 

12 shall— 

13 ‘‘(I) become effective upon serv14 ice upon the respondent; and 

15 ‘‘(II) unless set aside, limited, or 

16 suspended by the Commission or a 

17 court of competent jurisdiction, re18 main effective and enforceable pend19 ing the completion of the proceedings. 

20 ‘‘(E) REVIEW OF TEMPORARY ORDERS.— 

21 ‘‘(i) APPLICATION FOR REVIEW.—At 

22 any time after a respondent has been 

23 served with a temporary cease-and-desist 

24 order pursuant to subparagraph (C) or 

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1 sion of assets pursuant to subparagraph 

2 (D), the respondent may apply to the Com3 mission to have the order set aside, lim4 ited, or suspended. 

5 ‘‘(ii) NO PRIOR HEARING.—If a re6 spondent has been served with a temporary 

7 order entered without a prior hearing of 

8 the Commission— 

9 ‘‘(I) the respondent may, not 

10 later than 10 days after the date on 

11 which the order was served, request a 

12 hearing on the application; and 

13 ‘‘(II) the Commission shall hold a 

14 hearing and render a decision on the 

15 application at the earliest practicable 

16 time. 

17 ‘‘(iii) JUDICIAL REVIEW.— 

18 ‘‘(I) IN GENERAL.—An entity 

19 shall not be required to submit a re20 quest for rehearing of a temporary 

21 order before seeking judicial review in 

22 accordance with this subparagraph. 

23 ‘‘(II) TIMING OF REVIEW.—Not 

24 later than 10 days after the date on 

25 which a respondent is served with a 


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1 temporary cease-and-desist order en2 tered with a prior hearing of the Com3 mission, or 10 days after the date on 

4 which the Commission renders a deci5 sion on an application and hearing 

6 under clause (i) with respect to any 

7 temporary order entered without such 

8 a prior hearing— 

9 ‘‘(aa) the respondent may 

10 obtain a review of the order in a 

11 United States circuit court hav12 ing jurisdiction over the circuit in 

13 which the respondent resides or 

14 has a principal place of business, 

15 or in the United States Court of 

16 Appeals for the District of Co17 lumbia Circuit, for an order set18 ting aside, limiting, or sus19 pending the effectiveness or en20 forcement of the order; and 

21 ‘‘(bb) the court shall have 

22 jurisdiction to enter such an 

23 order. 

24 ‘‘(III) NO PRIOR HEARING.—A 

25 respondent served with a temporary 


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1 order entered without a prior hearing 

2 of the Commission may not apply to 

3 the applicable court described in sub4 clause (II) except after a hearing and 

5 decision by the Commission on the ap6 plication of the respondent under 

7 clauses (i) and (ii). 

8 ‘‘(iv) PROCEDURES.—Section 222 and 

9 Part III shall apply to— 

10 ‘‘(I) an application for review of 

11 an order under clause (i); and 

12 ‘‘(II) an order subject to review 

13 under clause (iii). 

14 ‘‘(v) NO AUTOMATIC STAY OF TEM15 PORARY ORDER.—The commencement of 

16 proceedings under clause (iii) shall not, un17 less specifically ordered by the court, oper18 ate as a stay of the order of the Commis19 sion. 

20 ‘‘(F) ACTIONS TO COLLECT CIVIL PEN21 ALTIES.—If any person fails to pay a civil pen22 alty assessed under this subsection after an 

23 order assessing the penalty has become final 

24 and unappealable, the Commission shall bring 


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1 an action to recover the amount of the penalty 

2 in any appropriate United States district court. 

3 ‘‘(4) TRANSACTION FEES.— 

4 ‘‘(A) IN GENERAL.—The Commission 

5 shall, in accordance with this paragraph, estab6 lish and collect transaction fees designed to re7 cover the costs to the Federal Government of 

8 the supervision and regulation of regulated al9 lowance markets and market participants, in10 cluding related costs for enforcement activities, 

11 policy and rulemaking activities, administration, 

12 legal services, and international regulatory ac13 tivities. 

14 ‘‘(B) INITIAL FEE RATE.—Each trading 

15 facility on or through which regulated allow16 ances are transacted shall pay to the Commis17 sion a fee at a rate of not more than $15 per 

18 $1,000,000 of the aggregate dollar amount of 

19 sales of regulated allowances transacted 

20 through the facility. 

21 ‘‘(C) ANNUAL ADJUSTMENT OF FEE

22 RATE.—The Commission shall, on an annual 

23 basis— 

24 ‘‘(i) assess the rate at which fees are 

25 to be collected as necessary to meet the 


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1 cost recovery requirement in subparagraph 

2 (A); and 

3 ‘‘(ii) consistent with subparagraph 

4 (B), adjust the rate as necessary in order 

5 to meet the requirement. 

6 ‘‘(D) REPORT ON ADEQUACY OF FEES IN

7 RECOVERING COSTS.—The Commission, shall, 

8 on an annual basis, report to the Committee on 

9 Energy and Commerce of the House of Rep10 resentatives and the Committee on Energy and 

11 Natural Resources of the Senate on the ade12 quacy of the transaction fees in providing fund13 ing for the Commission to regulate the regu14 lated allowance markets. 

15 ‘‘(5) JUDICIAL REVIEW.—Judicial review of ac16 tions taken by the Commission under this subsection 

17 shall be pursuant to part III. 

18 ‘‘(6) INFORMATION-SHARING.—Within 6 

19 months after a Federal agency with jurisdiction over 

20 regulated allowance derivatives is delegated author21 ity pursuant to subsection (c)(1), the agency shall 

22 enter into a memorandum of understanding with the 

23 Commission relating to information sharing, which 

24 shall include provisions ensuring that information re25 quests to markets within the respective jurisdiction 


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1 of the agency are properly coordinated to facilitate, 

2 among other things, effective information-sharing 

3 while minimizing duplicative information requests, 

4 and provisions regarding the treatment of propri5 etary information. 

6 ‘‘(7) ADDITIONAL EMPLOYEES REPORT AND AP7 POINTMENT.—Within 18 months after the date of 

8 the enactment of this section, the Commission shall 

9 submit to the President, the Committee on Energy 

10 and Commerce of the House of Representatives, and 

11 the Committee on Energy and Natural Resources of 

12 the Senate, a report that contains recommendations 

13 as to how many additional employees would be nec14 essary to provide robust oversight and enforcement 

15 of the regulations promulgated under this sub16 section. As soon as practicable after the completion 

17 of the report, subject to appropriations, the Commis18 sion shall appoint the recommended number of addi19 tional employees for such purposes. 

20 ‘‘(c) DELEGATION OF AUTHORITY BY THE PRESI21 DENT.— 

22 ‘‘(1) DELEGATION.—The President, taking into 

23 consideration the recommendations of the inter24 agency working group established in subsection (d), 

25 shall delegate to members of the working group and 


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1 the heads of other appropriate Federal agencies the 

2 authority to promulgate regulations for the estab3 lishment, operation, and oversight of all markets for 

4 regulated allowance derivatives. 

5 ‘‘(2) REGULATIONS.—The regulations promul6 gated pursuant to paragraph (1) shall— 

7 ‘‘(A) provide for effective and comprehen8 sive market oversight; 

9 ‘‘(B) prohibit fraud, market manipulation, 

10 and excess speculation, and provide measures to 

11 limit unreasonable fluctuation in the prices of 

12 regulated allowance derivatives; 

13 ‘‘(C) facilitate compliance with title VII of 

14 the Clean Air Act by covered entities; 

15 ‘‘(D) ensure market transparency and rec16 ordkeeping necessary to provide for efficient 

17 price discovery; prevention of fraud, market ma18 nipulation, and excess speculation; and compli19 ance with title VII of the Clean Air Act and 

20 section 610 of the Public Utility Regulatory 

21 Policies Act of 1978; 

22 ‘‘(E) ensure that position limitations for 

23 individual market participants are established 

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1 vidual market participants are established with 

2 respect to all regulated allowance derivative 

3 markets; 

4 ‘‘(F) ensure that margin requirements are 

5 established for each regulated allowance deriva6 tive; 

7 ‘‘(G) provide for the formation and oper8 ation of a market system that allows for best 

9 execution in the trading of regulated allowance 

10 derivatives; 

11 ‘‘(H) to the extent the regulations deviate 

12 from the rule set forth in paragraph (4)(B), 

13 limit or eliminate counterparty risks, market 

14 power concentration risks, and other risks asso15 ciated with over-the-counter trading, and pro16 mulgate reporting and market transparency 

17 rules for large traders; 

18 ‘‘(I) ensure that market participants do 

19 not evade position limits or otherwise under20 mine the integrity and effectiveness of the regu21 lations promulgated under subparagraph (C) 

22 through participation in markets not subject to 

23 the position limits and regulations; 


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1 ‘‘(J) establish standards, as necessary, for 

2 qualification as, and operation of, trading facili3 ties for regulated allowance derivatives; 

4 ‘‘(K) establish standards, as necessary, for 

5 qualification as, and operation of, clearing orga6 nizations for trading facilities for regulated al7 lowance derivatives; 

8 ‘‘(L) provide boards of trade designated as 

9 contract markets under the Commodity Ex10 change Act, and market participants, with an 

11 adequate transition period for compliance with 

12 any new regulatory requirements established 

13 under this paragraph; 

14 ‘‘(M) determine whether and to what ex15 tent offset creation contracts, to the extent in16 corporating regulated allowance derivatives, 

17 should be governed by the same regulations 

18 that apply to other regulated allowance deriva19 tives; and 

20 ‘‘(N) include such other requirements as 

21 necessary to preserve market integrity and fa22 cilitate compliance with title VII of the Clean 

23 Air Act and section 610 of the Public Utility 

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1 tions promulgated under such title and such 

2 section. 

3 ‘‘(3) DEADLINE.—The agencies authorized to 

4 promulgate regulations for the establishment, oper5 ation, and oversight of markets for regulated allow6 ance derivatives pursuant to paragraph (1) shall 

7 promulgate such regulations not later than 18 

8 months after the date of the enactment of this sec9 tion, and from time to time thereafter as may be ap10 propriate. 

11 ‘‘(4) DEFAULT RULES.— 

12 ‘‘(A) An individual market participant, di13 rectly or in concert with another participant, 

14 shall not control more than 10 percent of the 

15 open interest in any regulated allowance deriva16 tive. 

17 ‘‘(B) All contracts for the purchase or sale 

18 of any regulated allowance derivative shall be 

19 executed on or through a board of trade des20 ignated as a contract market under the Com21 modity Exchange Act. 

22 ‘‘(C) To the extent that regulations pro23 mulgated under this subsection provide dif24 ferent rules with respect to the matters de25 scribed in subparagraph (A) or (B), the regulaVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00875 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tions shall supersede subparagraph (A) or (B), 

2 as the case may be. 

3 ‘‘(d) WORKING GROUP.— 

4 ‘‘(1) ESTABLISHMENT.—Not later than 30 days 

5 after the date of the enactment of this section, the 

6 President shall establish an interagency working 

7 group on carbon market oversight, which shall in8 clude the Administrator of the Environmental Pro9 tection Agency and representatives of other relevant 

10 agencies, to make recommendations to the President 

11 regarding proposed regulations for the establish12 ment, operation, and oversight of markets for regu13 lated allowance derivatives. 

14 ‘‘(2) REPORT.—Not later than 180 days after 

15 the date of the enactment of this section, and bienni16 ally thereafter, the interagency working group shall 

17 submit a written report to the President and Con18 gress that includes its recommendations to the 

19 President regarding proposed regulations for the es20 tablishment, operation, and oversight of markets for 

21 regulated allowance derivatives and any rec22 ommendations to Congress for statutory changes 

23 needed to ensure the establishment, operation, and 

24 oversight of transparent, fair, stable, and efficient 

25 markets for regulated allowance derivatives. 


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1 ‘‘(e) ENFORCEMENT OF REGULATIONS.—Each Fed2 eral agency that promulgates under subsection (c) a regu3 lation of conduct with respect to a regulated allowance de4 rivative shall have the same authority to enforce compli5 ance with the regulation as the Commodity Futures Trad6 ing Commission has to enforce compliance with any regu7 lation of similar conduct with respect to a contract, agree8 ment, or transaction over which the Commodity Futures 

9 Trading Commission has jurisdiction, except that any en10 forcement by the Federal Energy Regulatory Commission 

11 shall be pursuant to section 222 and Part III. 

12 ‘‘(f) PENALTY FOR FRAUD AND FALSE OR MIS13 LEADING STATEMENTS.—A person convicted under sec14 tion 1041 of title 18, United States Code, may be prohib15 ited from holding or trading regulated allowances for a 

16 period of not more than 5 years pursuant to the regula17 tions promulgated under this section, except that, if the 

18 person is a covered entity, the person shall be allowed to 

19 hold sufficient regulated allowances to meet its compliance 

20 obligations. 

21 ‘‘(g) RELATION TO STATE LAW.—Nothing in this 

22 section shall preclude, diminish or qualify any authority 

23 of a State or political subdivision thereof to adopt or en24 force any unfair competition, antitrust, consumer protec25 tion, securities, commodities or any other law or regulaVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00877 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tion, except that no such State law or regulation may re2 lieve any person of any requirement otherwise applicable 

3 under this section. 

4 ‘‘(h) MARKET REPORTS.— 

5 ‘‘(1) COLLECTION AND ANALYSIS OF INFORMA6 TION.—The Commission, in conjunction with the 

7 Federal agency with jurisdiction over regulated al8 lowance derivatives pursuant to subsection (c)(1), 

9 shall, on a continuous basis, collect and analyze the 

10 following information on the functioning of the mar11 kets for regulated instruments established under this 

12 part: 

13 ‘‘(A) The status of, and trends in, the 

14 markets, including prices, trading volumes, 

15 transaction types, and trading channels and 

16 mechanisms. 

17 ‘‘(B) Spikes, collapses, and volatility in 

18 prices of regulated instruments, and the causes 

19 therefor. 

20 ‘‘(C) The relationship between the market 

21 for regulated allowances and allowance deriva22 tives, and the spot and futures markets for en23 ergy commodities, including electricity. 

24 ‘‘(D) Evidence of fraud or manipulation in 

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1 ket of any such fraud or manipulation (or 

2 threat of fraud or manipulation) that the Com3 mission, in conjunction with the Federal agen4 cy, has identified, and the effectiveness of cor5 rective measures undertaken by the Commis6 sion, in conjunction with the Federal agency, to 

7 address the fraud, manipulation, or threat. 

8 ‘‘(E) The economic effects of the markets, 

9 including to macro- and micro-economic effects 

10 of unexpected significant increases and de11 creases in the price of regulated instruments. 

12 ‘‘(F) Any changes in the roles, activities, 

13 or strategies of various market participants. 

14 ‘‘(G) Regional, industrial, and consumer 

15 responses to the markets, and energy invest16 ment responses to the markets. 

17 ‘‘(H) Any other issue related to the mar18 kets that the Commission, in conjunction with 

19 the entities, deems appropriate. 

20 ‘‘(2) ANNUAL REPORTS TO THE CONGRESS.— 

21 Not later than 1 month after the end of each cal22 endar year, the Commission, in conjunction with the 

23 Federal agency, shall submit to the President, the 

24 Committee on Energy and Commerce of the House 

25 of Representatives, and the Committee on Energy 


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1 and Natural Resources of the Senate, and make 

2 available to the public, a report on the matters de3 scribed in paragraph (1) with respect to the year, in4 cluding recommendations for any administrative or 

5 statutory measures the Commission, in conjunction 

6 with the Federal agency, considers necessary to ad7 dress any threats to the transparency, fairness, or 

8 integrity of the markets in regulated instruments. 

9 ‘‘SEC. 402. APPLICABILITY OF PART III PROVISIONS. 

10 ‘‘(a) SECTIONS 301, 304, AND 306.—Sections 301, 

11 304, and 306 shall not apply to this part. 

12 ‘‘(b) SECTIONS 307, 309, AND 314.—Sections 307, 

13 309, and 314 shall only apply to section 401(c) to the ex14 tent that the Commission is delegated authority to pro15 mulgate regulations for the establishment, operation, and 

16 oversight of markets for regulated allowance derivatives 

17 (as defined in section 401). If the Commission is not dele18 gated authority to promulgate regulations for the estab19 lishment, operation, and oversight of markets for regu20 lated allowance derivatives, sections 307, 309, and 314 

21 shall not apply to section 401(f) in the case of regulated 

22 allowance derivatives. 

23 ‘‘(c) SECTION 315.—In applying section 315(a) to 

24 this part, the words ‘‘person or entity’’ shall be substituted 

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1 tion 315(b) to this part, the words ‘‘an entity’’ shall be 

2 substituted for the words ‘‘a licensee or public utility’’ and 

3 the words ‘‘such entity’’ shall be substituted for the words 

4 ‘‘such licensee or public utility.’’ 

5 ‘‘(d) SECTION 316.—Section 316(a) shall not apply 

6 to section 401(f).’’. 

7 (b) CRIMINAL PROHIBITION AGAINST FRAUD AND

8 FALSE OR MISLEADING STATEMENTS.— 

9 (1) Chapter 47 of title 18, United States Code, 

10 is amended by adding at the end the following: 

11 ‘‘§ 1041. Fraud and false statements in connection 

12 with regulated allowances 

13 ‘‘Whoever in connection with a transaction involving 

14 a regulated allowance (as defined in section 401(a) of the 

15 Federal Power Act, as added by section 341 of the Amer16 ican Clean Energy and Security Act of 2009), know17 ingly— 

18 ‘‘(1) makes or uses a materially false or mis19 leading statement, writing, representation, scheme, 

20 or device; or 

21 ‘‘(2) falsifies, conceals, or covers up by any 

22 trick, scheme, or device any material fact, 

23 shall be fined not more than $5,000,000 (or $25,000,000 

24 in the case of an organization) or imprisoned not more 

25 than 20 years, or both.’’. 


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1 (2) The table of sections at the beginning of 

2 chapter 47 of title 18, United States Code, is 

3 amended by adding at the end the following new 

4 item: 

‘‘1041. Fraud and false statements in connection with regulated allowances.’’. 

5 Subtitle E—Additional Market 

6 Assurance 

7 SEC. 351. REGULATION OF CERTAIN TRANSACTIONS IN DE8 RIVATIVES INVOLVING ENERGY COMMOD9 ITIES. 

10 (a) ENERGY COMMODITY DEFINED.—Section 1a of 

11 the Commodity Exchange Act (7 U.S.C. 1a) is amended— 

12 (1) in paragraph (14), by inserting ‘‘, an energy 

13 commodity,’’ after ‘‘excluded commodity’’; 

14 (2) by redesignating paragraphs (13) through 

15 (21) and paragraphs (22) through (34) as para16 graphs (14) through (22) and paragraphs (24) 

17 through (36), respectively; 

18 (3) by inserting after paragraph (12) the fol19 lowing: 

20 ‘‘(13) ENERGY COMMODITY.—The term ‘energy 

21 commodity’ means— 

22 ‘‘(A) coal; 

23 ‘‘(B) crude oil, gasoline, diesel fuel, jet 

24 fuel, heating oil, and propane; 


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1 ‘‘(C) electricity (excluding financial trans2 mission rights which are subject to regulation 

3 and oversight by the Federal Energy Regu4 latory Commission); 

5 ‘‘(D) natural gas; and 

6 ‘‘(E) any other substance (other than an 

7 excluded commodity, a metal, or an agricultural 

8 commodity) that is used as a source of energy, 

9 as the Commission, in its discretion, deems ap10 propriate.’’; and 

11 (4) by inserting after paragraph (22) (as so re12 designated by paragraph (2) of this subsection) the 

13 following: 

14 ‘‘(23) INCLUDED ENERGY TRANSACTION.—The 

15 term ‘included energy transaction’ means a contract, 

16 agreement, or transaction in an energy commodity 

17 for future delivery that provides for a delivery point 

18 of the energy commodity in the United States or a 

19 territory or possession of the United States, or that 

20 is offered or transacted on or through a computer 

21 terminal located in the United States.’’. 

22 (b) EXTENSION OF REGULATORY AUTHORITY TO

23 SWAPS INVOLVING ENERGY TRANSACTIONS.—Section 

24 2(g) of such Act (7 U.S.C. 2(g)) is amended by inserting 


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1 ‘‘or an energy commodity’’ after ‘‘agricultural com2 modity’’. 

3 (c) ELIMINATION OF EXEMPTION FOR OVER-THE4 COUNTER SWAPS INVOLVING ENERGY COMMODITIES.— 

5 Section 2(h)(1) of such Act (7 U.S.C. 2(h)(1)) is amended 

6 by inserting ‘‘(other than an energy commodity)’’ after 

7 ‘‘exempt commodity’’. 

8 (d) EXTENSION OF REGULATORY AUTHORITY TO IN9 CLUDED ENERGY TRANSACTIONS ON FOREIGN BOARDS

10 OF TRADE.—Section 4 of such Act (7 U.S.C. 6) is amend11 ed— 

12 (1) in subsection (a), by inserting ‘‘, and which 

13 is not an included energy transaction’’ after ‘‘terri14 tories or possessions’’ the 2nd place it appears; and 

15 (2) in subsection (b), by adding at the end the 

16 following: ‘‘The preceding sentence shall not apply 

17 with respect to included energy transactions.’’. 

18 (e) LIMITATION OF GENERAL EXEMPTIVE AUTHOR19 ITY OF THE CFTC WITH RESPECT TO INCLUDED EN20 ERGY TRANSACTIONS.— 

21 (1) IN GENERAL.—Section 4(c) of such Act (7 

22 U.S.C. 6(c)) is amended by adding at the end the 

23 following: 

24 ‘‘(6) The Commission may not exempt any included 

25 energy transaction from the requirements of subsection 


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1 (a), unless the Commission provides 60 days advance no2 tice to the Congress and the Position Limit Energy Advi3 sory Group and solicits public comment about the exemp4 tion request and any proposed Commission action.’’. 

5 (2) NULLIFICATION OF NO-ACTION LETTER EX6 EMPTIONS TO CERTAIN REQUIREMENTS APPLICABLE

7 TO INCLUDED ENERGY TRANSACTIONS.—Beginning 

8 180 days after the date of the enactment of this Act, 

9 any exemption provided by the Commodity Futures 

10 Trading Commission that has allowed included en11 ergy transactions (as defined in section 1a(13) of 

12 the Commodity Exchange Act) to be conducted with13 out regard to the requirements of section 4(a) of 

14 such Act shall be null and void. 

15 (f) REQUIREMENT TO ESTABLISH UNIFORM SPECU16 LATIVE POSITION LIMITS FOR ENERGY TRANSACTIONS.— 

17 (1) IN GENERAL.—Section 4a(a) of such Act (7 

18 U.S.C. 6a(a)) is amended— 

19 (A) by inserting ‘‘(1)’’ after ‘‘(a)’’; 

20 (B) by inserting after the 2nd sentence the 

21 following: ‘‘With respect to energy transactions, 

22 the Commission shall fix limits on the aggre23 gate number of positions which may be held by 

24 any person for each month across all markets 

25 subject to the jurisdiction of the Commission.’’; 


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1 (C) in the 4th sentence by inserting ‘‘, con2 sistent with the 3rd sentence,’’ after ‘‘Commis3 sion’’; and 

4 (D) by adding after and below the end the 

5 following: 

6 ‘‘(2)(A) Not later than 60 days after the date of the 

7 enactment of this paragraph, the Commission shall con8 vene a Position Limit Energy Advisory Group consisting 

9 of representatives from— 

10 ‘‘(i) 7 predominantly commercial short hedgers 

11 of the actual energy commodity for future delivery; 

12 ‘‘(ii) 7 predominantly commercial long hedgers 

13 of the actual energy commodity for future delivery; 

14 ‘‘(iii) 4 non-commercial participants in markets 

15 for energy commodities for future delivery; and 

16 ‘‘(iv) each designated contract market or de17 rivatives transaction execution facility upon which a 

18 contract in the energy commodity for future delivery 

19 is traded, and each electronic trading facility that 

20 has a significant price discovery contract in the en21 ergy commodity. 

22 ‘‘(B) Not later than 60 days after the date on which 

23 the advisory group is convened under subparagraph (A), 

24 and annually thereafter, the advisory group shall submit 


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1 to the Commission advisory recommendations regarding 

2 the position limits to be established in paragraph (1). 

3 ‘‘(C) The Commission shall have exclusive authority 

4 to grant exemptions for bona fide hedging transactions 

5 and positions from position limits imposed under this Act 

6 on energy transactions.’’. 

7 (2) CONFORMING AMENDMENTS.— 

8 (A) SIGNIFICANT PRICE DISCOVERY CON9 TRACTS.—Section 2(h)(7) of such Act (7 U.S.C. 

10 2(h)(7)) is amended— 

11 (i) in subparagraph (A)— 

12 (I) by inserting ‘‘of this para13 graph and section 4a(a)’’ after ‘‘(B) 

14 through (D)’’; and 

15 (II) by inserting ‘‘of this para16 graph’’ before the period; and 

17 (ii) in subparagraph (C)(ii)(IV)— 

18 (I) in the heading, by striking 

19 ‘‘LIMITATIONS OR’’; and 

20 (II) by striking ‘‘position limita21 tions or’’. 

22 (B) CONTRACTS TRADED ON OR THROUGH

23 DESIGNATED CONTRACT MARKETS.—Section 

24 5(d)(5) of such Act (7 U.S.C. 7(d)(5)) is 

25 amended— 


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1 (i) in the heading by striking ‘‘LIMI2 TATIONS OR’’; and 

3 (ii) by striking ‘‘position limitations 

4 or’’. 

5 (C) CONTRACTS TRADED ON OR THROUGH

6 DERIVATIVES TRANSACTION EXECUTION FACILI7 TIES.—Section 5a(d)(4) of such Act (7 U.S.C. 

8 7a(d)(4)) is amended— 

9 (i) in the heading by striking ‘‘LIMI10 TATIONS OR’’; and 

11 (ii) by striking ‘‘position limits or’’. 

12 (g) ELIMINATION OF THE SWAPS LOOPHOLE.—Sec13 tion 4a(c) of such Act (7 U.S.C. 6a(c)) is amended— 

14 (1) by inserting ‘‘(1)’’ after ‘‘(c)’’; and 

15 (2) by adding after and below the end the fol16 lowing: 

17 ‘‘(2) For the purposes of contracts of sale for future 

18 delivery and options on such contracts or commodities, the 

19 Commission shall define what constitutes a bona fide 

20 hedging transaction or position as a transaction or posi21 tion that— 

22 ‘‘(A)(i) represents a substitute for transactions 

23 made or to be made or positions taken or to be 

24 taken at a later time in a physical marketing chan25 nel; 


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1 ‘‘(ii) is economically appropriate to the reduc2 tion of risks in the conduct and management of a 

3 commercial enterprise; and 

4 ‘‘(iii) arises from the potential change in the 

5 value of— 

6 ‘‘(I) assets that a person owns, produces, 

7 manufactures, processes, or merchandises or 

8 anticipates owning, producing, manufacturing, 

9 processing, or merchandising; 

10 ‘‘(II) liabilities that a person owns or an11 ticipates incurring; or 

12 ‘‘(III) services that a person provides, pur13 chases, or anticipates providing or purchasing; 

14 or 

15 ‘‘(B) reduces risks attendant to a position re16 sulting from a transaction that— 

17 ‘‘(i) was executed pursuant to subsection 

18 (d), (g), (h)(1), or (h)(2) of section 2, or an ex19 emption issued by the Commission by rule, reg20 ulation or order; and 

21 ‘‘(ii) was executed opposite a counterparty 

22 for which the transaction would qualify as a 

23 bona fide hedging transaction pursuant to para24 graph (2)(A) of this subsection.’’. 


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1 (h) DETAILED REPORTING AND DISAGGREGATION OF

2 MARKET DATA.—Section 4 of such Act (7 U.S.C. 6) is 

3 amended by adding at the end the following: 

4 ‘‘(e) DETAILED REPORTING AND DISAGGREGATION

5 OF MARKET DATA.— 

6 ‘‘(1) INDEX TRADERS AND SWAP DEALERS RE7 PORTING.—The Commission shall issue a proposed 

8 rule defining and classifying index traders and swap 

9 dealers (as those terms are defined by the Commis10 sion) for purposes of data reporting requirements 

11 and setting routine detailed reporting requirements 

12 for any positions of such entities in contracts traded 

13 on designated contract markets, over-the-counter 

14 markets, derivatives transaction execution facilities, 

15 foreign boards of trade subject to section 4(f), and 

16 electronic trading facilities with respect to signifi17 cant price discovery contracts not later than 120 

18 days after the date of the enactment of this sub19 section, and issue a final rule within 180 days after 

20 such date of enactment. 

21 ‘‘(2) DISAGGREGATION OF INDEX FUNDS AND

22 OTHER DATA IN MARKETS.—Subject to section 8 

23 and beginning within 60 days of the issuance of the 

24 final rule required by paragraph (1), the Commis25 sion shall disaggregate and make public weekly— 


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1 ‘‘(A) the number of positions and total no2 tional value of index funds and other passive, 

3 long-only and short-only positions (as defined 

4 by the Commission) in all markets to the extent 

5 such information is available; and 

6 ‘‘(B) data on speculative positions relative 

7 to bona fide physical hedgers in those markets 

8 to the extent such information is available. 

9 ‘‘(3) DISCLOSURE OF IDENTITY OF HOLDERS

10 OF POSITIONS IN INDEXES IN EXCESS OF POSITION

11 LIMITS.—The Commission shall include in its weekly 

12 Commitment of Trader reports the identity of each 

13 person who holds a position in an index in excess of 

14 a limit imposed under section 4i.’’. 

15 (i) AUTHORITY TO SET LIMITS TO PREVENT EXCES16 SIVE SPECULATION IN INDEXES.— 

17 (1) IN GENERAL.—Section 4a of such Act (7 

18 U.S.C. 6a) is amended by adding at the end the fol19 lowing: 

20 ‘‘(f) The provisions of this section shall apply to the 

21 amounts of trading which may be done or positions which 

22 may be held by any person under contracts of sale of an 

23 index for future delivery on or subject to the rules of any 

24 contract market, derivatives transaction execution facility, 

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1 cility with respect to a significant price discovery contract, 

2 in the same manner in which this section applies to con3 tracts of sale of a commodity for future delivery.’’. 

4 (2) REGULATIONS.—The Commodity Futures 

5 Trading Commission shall issue regulations under 

6 section 4a(f) of the Commodity Exchange Act within 

7 180 days after the date of the enactment of this Act. 

8 SEC. 352. NO EFFECT ON AUTHORITY OF THE FEDERAL EN9 ERGY REGULATORY COMMISSION. 

10 Section 2 of the Commodity Exchange Act (7 U.S.C. 

11 2) is amended by adding at the end the following:. 

12 ‘‘(j) This Act shall not be interpreted to affect the 

13 jurisdiction of the Federal Energy Regulatory Commission 

14 with respect to the authority of the Federal Energy Regu15 latory Commission under the Federal Power Act (16 

16 U.S.C. 791a et seq.), the Natural Gas Act (15 U.S.C. 717 

17 et seq.), or other law to obtain information, carry out en18 forcement actions, or otherwise carry out the responsibil19 ities of the Federal Energy Regulatory Commission.’’. 

20 SEC. 353. INSPECTOR GENERAL OF THE COMMODITY FU21 TURES TRADING COMMISSION. 

22 (a) ELEVATION OF OFFICE.— 

23 (1) INCLUSION OF CFTC IN DEFINITION OF ES24 TABLISHMENT.— 


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1 (A) Section 12(1) of the Inspector General 

2 Act of 1978 (5 U.S.C. App.) is amended by 

3 striking ‘‘or the Federal Cochairpersons of the 

4 Commissions established under section 15301 

5 of title 40, United States Code;’’ and inserting 

6 ‘‘the Federal Cochairpersons of the Commis7 sions established under section 15301 of title 

8 40, United States Code; or the Chairman of the 

9 Commodity Futures Trading Commission;’’. 

10 (B) Section 12(2) of the Inspector General 

11 Act of 1978 (5 U.S.C. App.) is amended by 

12 striking ‘‘or the Commissions established under 

13 section 15301 of title 40, United States Code,’’ 

14 and inserting ‘‘the Commissions established 

15 under section 15301 of title 40, United States 

16 Code, or the Commodity Futures Trading Com17 mission,’’. 

18 (2) EXCLUSION OF CFTC FROM DEFINITION OF

19 DESIGNATED FEDERAL ENTITY.—Section 8G(a)(2) 

20 of the Inspector General Act of 1978 (5 U.S.C. 

21 App.) is amended by striking ‘‘the Commodity Fu22 tures Trading Commission,’’. 

23 (b) PROVISIONS RELATING TO PAY AND PERSONNEL

24 AUTHORITY.— 


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1 (1) PROVISION RELATING TO THE POSITION OF

2 INSPECTOR GENERAL OF THE CFTC.—In the case of 

3 the Inspector General of the Commodities Futures 

4 Trading Commission, subsections (b) and (c) of sec5 tion 4 of the Inspector General Reform Act of 2008 

6 (Public Law 110-409) shall apply in the same man7 ner as if the Commission was a designated Federal 

8 entity under section 8G. The Inspector General of 

9 the Commodities Futures Trading Commission shall 

10 not be subject to section 3(e) of such Act. 

11 (2) PROVISION RELATING TO OTHER PER12 SONNEL.—Notwithstanding paragraphs (7) and (8) 

13 of section 6(a) of the Inspector General Act of 1978 

14 (5 U.S.C. App.), the Inspector General of the Com15 modities Futures Trading Commission may select, 

16 appoint, and employ such officers and employees as 

17 may be necessary for carrying out the functions, 

18 powers, and duties of the Office of Inspector General 

19 and to obtain the temporary or intermittent services 

20 of experts or consultants or an organization of ex21 perts or consultants, subject to the applicable laws 

22 and regulations that govern such selections, appoint23 ments, and employment, and the obtaining of such 

24 services, within the Commodities Futures Trading 

25 Commission. 


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1 (c) EFFECTIVE DATE; TRANSITION RULE.— 

2 (1) EFFECTIVE DATE.—The amendments made 

3 by this section shall take effect 30 days after the 

4 date of the enactment of this Act. 

5 (2) TRANSITION RULE.—An individual serving 

6 as Inspector General of the Commodity Futures 

7 Trading Commission on the effective date of this 

8 section pursuant to an appointment made under sec9 tion 8G of the Inspector General Act of 1978 (5 

10 U.S.C. App.)— 

11 (A) may continue so serving until the 

12 President makes an appointment under section 

13 3(a) of such Act consistent with the amend14 ments made by this section; and 

15 (B) shall, while serving under subpara16 graph (A), remain subject to the provisions of 

17 section 8G of such Act which apply with respect 

18 to the Commodity Futures Trading Commis19 sion. 

20 SEC. 354. SETTLEMENT AND CLEARING THROUGH REG21 ISTERED DERIVATIVES CLEARING ORGANIZA22 TIONS. 

23 (a) IN GENERAL.— 

24 (1) APPLICATION TO EXCLUDED DERIVATIVE

25 TRANSACTIONS.— 


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1 (A) Section 2(d)(1) of the Commodity Ex2 change Act (7 U.S.C. 2(d)(1)) is amended— 

3 (i) by striking ‘‘and’’ at the end of 

4 subparagraph (A); 

5 (ii) by striking the period at the end 

6 of subparagraph (B) and inserting ‘‘; 

7 and’’; and 

8 (iii) by adding at the end the fol9 lowing: 

10 ‘‘(C) except as provided in section 4(f), the 

11 agreement, contract, or transaction is settled 

12 and cleared through a derivatives clearing orga13 nization registered with the Commission.’’. 

14 (B) Section 2(d)(2) of such Act (7 U.S.C. 

15 2(d)(2)) is amended— 

16 (i) by striking ‘‘and’’ at the end of 

17 subparagraph (B); 

18 (ii) by striking the period at the end 

19 of subparagraph (C) and inserting ‘‘; and’’; 

20 and 

21 (iii) by adding at the end the fol22 lowing: 

23 ‘‘(D) except as provided in section 4(f), the 

24 agreement, contract, or transaction is settled 


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1 and cleared through a derivatives clearing orga2 nization registered with the Commission.’’. 

3 (2) APPLICATION TO CERTAIN SWAP TRANS4 ACTIONS.—Section 2(g) of such Act (7 U.S.C. 2(g)) 

5 is amended— 

6 (A) by striking ‘‘and’’ at the end of para7 graph (2); 

8 (B) by striking the period at the end of 

9 paragraph (3) and inserting ‘‘; and’’; and 

10 (C) by adding at the end the following: 

11 ‘‘(4) except as provided in section 4(f), settled 

12 and cleared through a derivatives clearing organiza13 tion registered with the Commission.’’. 

14 (3) APPLICATION TO CERTAIN TRANSACTIONS

15 IN EXEMPT COMMODITIES.— 

16 (A) Section 2(h)(1) of such Act ( 7 U.S.C. 

17 2(h)(1)) is amended— 

18 (i) by striking ‘‘and’’ at the end of 

19 subparagraph (A); 

20 (ii) by striking the period at the end 

21 of subparagraph (B) and inserting ‘‘; 

22 and’’; and 

23 (iii) by adding at the end the fol24 lowing: 


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1 ‘‘(C) except as provided in section 4(f), is 

2 settled and cleared through a derivatives clear3 ing organization registered with the Commis4 sion.’’. 

5 (B) Section 2(h)(3) of such Act (7 U.S.C. 

6 2(h)(3)) is amended— 

7 (i) by striking ‘‘and’’ at the end of 

8 subparagraph (A); 

9 (ii) by striking the period at the end 

10 of subparagraph (B) and inserting ‘‘; 

11 and’’; and 

12 (iii) by adding at the end the fol13 lowing: 

14 ‘‘(C) except as provided in section 4(f), set15 tled and cleared through a derivatives clearing 

16 organization registered with the Commission.’’. 

17 (4) GENERAL EXEMPTIVE AUTHORITY.—Sec18 tion 4(c)(1) of such Act (7 U.S.C. 6(c)(1)) is 

19 amended by inserting ‘‘the agreement, contract, or 

20 transaction, except as provided in section 4(h), will 

21 be settled and cleared through a derivatives clearing 

22 organization registered with the Commission and’’ 

23 before ‘‘the Commission determines’’. 

24 (5) CONFORMING AMENDMENT RELATING TO

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1 tion 2(h)(7)(D) of such Act (7 U.S.C. 2(h)(7)(D)) is 

2 amended by striking the designation and heading for 

3 the subparagraph and all that follows through ‘‘As 

4 part of’’ and inserting the following: 

5 ‘‘(D) REVIEW OF IMPLEMENTATION.—As 

6 part of’’. 

7 (b) ALTERNATIVES TO CLEARING THROUGH DES8 IGNATED CLEARING ORGANIZATIONS.—Section 4 of such 

9 Act (7 U.S.C. 6), as amended by section 351(h) of this 

10 Act, is amended by adding at the end the following: 

11 ‘‘(f) ALTERNATIVES TO CLEARING THROUGH DES12 IGNATED CLEARING ORGANIZATIONS.— 

13 ‘‘(1) SETTLEMENT AND CLEARING THROUGH

14 CERTAIN OTHER REGULATED ENTITIES.—An agree15 ment, contract, or transaction, or class thereof, re16 lating to an excluded commodity, that would other17 wise be required to be settled and cleared by section 

18 2(d)(1)(C), 2(d)(2)(D), 2(g)(4), 2(h)(1)(C), or 

19 2(h)(3)(C) of this Act, or subsection (c)(1) of this 

20 section may be settled and cleared through an entity 

21 listed in subsections (a) or (b) of section 409 of the 

22 Federal Deposit Insurance Corporation Improvement 

23 Act of 1991. 

24 ‘‘(2) WAIVER OF CLEARING REQUIREMENT.— 


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1 ‘‘(A) The Commission, in its discretion, 

2 may exempt an agreement, contract, or trans3 action, or class thereof, that would otherwise be 

4 required by section 2(d)(1)(C), 2(d)(2)(D), 

5 2(g)(4), 2(h)(1)(C), or 2(h)(3)(C) of this Act, 

6 or subsection (c)(1) of this section to be settled 

7 and cleared through a derivatives clearing orga8 nization registered with the Commission from 

9 such requirement. 

10 ‘‘(B) In granting exemptions pursuant to 

11 subparagraph (A), the Commission shall consult 

12 with the Securities and Exchange Commission 

13 and the Board of Governors of the Federal Re14 serve System regarding exemptions that relate 

15 to excluded commodities or entities for which 

16 the Securities Exchange Commission or the 

17 Board of Governors of the Federal Reserve Sys18 tem serve as the primary regulator. 

19 ‘‘(C) Before granting an exemption pursu20 ant to subparagraph (A), the Commission shall 

21 find that the agreement, contract, or trans22 action, or class thereof— 

23 ‘‘(i) is highly customized as to its ma24 terial terms and conditions; 

25 ‘‘(ii) is transacted infrequently; 


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1 ‘‘(iii) does not serve a significant 

2 price-discovery function in the market3 place; and 

4 ‘‘(iv) is being entered into by parties 

5 who can demonstrate the financial integ6 rity of the agreement, contract, or trans7 action and their own financial integrity, as 

8 such terms and standards are determined 

9 by the Commission. The standards may in10 clude, with respect to any federally regu11 lated financial entity for which net capital 

12 requirements are imposed, a net capital re13 quirement associated with any agreement, 

14 contract, or transaction subject to an ex15 emption from the clearing requirement 

16 that is higher than the net capital require17 ment that would be associated with such a 

18 transaction were it cleared 

19 ‘‘(D) Any agreement, contract, or trans20 action, or class thereof, which is exempted pur21 suant to subparagraph (A) shall be reported to 

22 the Commission in a manner designated by the 

23 Commission, or to such other entity the Com24 mission deems appropriate. 


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1 ‘‘(E) The Commission, the Securities and 

2 Exchange Commission and the Board of Gov3 ernors of the Federal Reserve System shall 

4 enter into a memorandum of understanding by 

5 which the information reported to the Commis6 sion pursuant to subparagraph (D) with regard 

7 to excluded commodities or entities for which 

8 the Securities Exchange Commission or the 

9 Board of Governors of the Federal Reserve Sys10 tem serve as the primary regulator may be pro11 vided to the other agencies. 

12 ‘‘(g) SPOT AND FORWARD EXCLUSION.—The settle13 ment and clearing requirements of section 2(d)(1)(C), 

14 2(d)(2)(D), 2(g)(4), 2(h)(1)(C), 2(h)(3)(C), or 4(c)(1) 

15 shall not apply to an agreement, contract, or transaction 

16 of any cash commodity for immediate or deferred ship17 ment or delivery, as defined by the Commission.’’. 

18 (c) ADDITIONAL REQUIREMENTS APPLICABLE TO

19 APPLICANTS FOR REGISTRATION AS A DERIVATIVE

20 CLEARING ORGANIZATION.—Section 5b(c)(2) of such Act 

21 (7 U.S.C. 7a-1(c)(2)) is amended by adding at the end 

22 the following: 

23 ‘‘(O) DISCLOSURE OF GENERAL INFORMA24 TION.—The applicant shall disclose publicly and 

25 to the Commission information concerning— 


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1 ‘‘(i) the terms and conditions of con2 tracts, agreements, and transactions 

3 cleared and settled by the applicant; 

4 ‘‘(ii) the conventions, mechanisms, 

5 and practices applicable to the contracts, 

6 agreements, and transactions; 

7 ‘‘(iii) the margin-setting methodology 

8 and the size and composition of the finan9 cial resource package of the applicant; and 

10 ‘‘(iv) other information relevant to 

11 participation in the settlement and clearing 

12 activities of the applicant. 

13 ‘‘(P) DAILY PUBLICATION OF TRADING IN14 FORMATION.—The applicant shall make public 

15 daily information on settlement prices, volume, 

16 and open interest for contracts settled or 

17 cleared pursuant to the requirements of section 

18 2(d)(1)(C), 2(d)(2)(D), 2(g)(4), 2(h)(1)(C), 

19 2(h)(3)(C) or 4(c)(1) of this Act by the appli20 cant if the Commission determines that the 

21 contracts perform a significant price discovery 

22 function for transactions in the cash market for 

23 the commodity underlying the contracts. 

24 ‘‘(Q) FITNESS STANDARDS.—The applicant 

25 shall establish and enforce appropriate fitness 


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1 standards for directors, members of any dis2 ciplinary committee, and members of the appli3 cant, and any other persons with direct access 

4 to the settlement or clearing activities of the 

5 applicant, including any parties affiliated with 

6 any of the persons described in this subpara7 graph.’’. 

8 (d) AMENDMENTS.— 

9 (1) Section 409 of the Federal Deposit Insur10 ance Corporation Improvement Act of 1991 (12 

11 U.S.C. 4422) is amended by adding at the end the 

12 following: 

13 ‘‘(c) CLEARING REQUIREMENT.—A multilateral 

14 clearing organization described in subsections (a) or (b) 

15 of this section shall comply with requirements similar to 

16 the requirements of sections 5b and 5c of the Commodity 

17 Exchange Act.’’. 

18 (2) Section 407 of the Legal Certainty for 

19 Bank Products Act of 2000 (7 U.S.C. 27e) is 

20 amended by inserting ‘‘and the settlement and clear21 ing requirements of sections 2(d)(1)(C), 2(d)(2)(D), 

22 2(g)(4), 2(h)(1)(C), 2(h)(3)(C), and 4(c)(1) of such 

23 Act’’ after ‘‘the clearing of covered swap agree24 ments’’. 


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1 (e) EFFECTIVE DATE.—The amendments made by 

2 this section shall take effect 150 days after the date of 

3 the enactment of this Act. 

4 (f) TRANSITION RULE.—Any agreement, contract, or 

5 transaction entered into before the date of the enactment 

6 of this Act or within 150 days after such date of enact7 ment, in reliance on subsection (d), (g), (h)(1), or (h)(3) 

8 of section 2 of the Commodity Exchange Act or any other 

9 exemption issued by the Commission Futures Trading 

10 Commission by rule, regulation, or order shall, within 90 

11 days after such date of enactment, unless settled and 

12 cleared through an entity registered with the Commission 

13 as a derivatives clearing organization or another clearing 

14 entity pursuant to section 4(f) of such Act, be reported 

15 to the Commission in a manner designated by the Com16 mission, or to such other entity as the Commission deems 

17 appropriate. 

18 SEC. 355. LIMITATION ON ELIGIBILITY TO PURCHASE A 

19 CREDIT DEFAULT SWAP. 

20 (a) IN GENERAL.—Section 4c of the Commodity Ex21 change Act (7 U.S.C. 6c) is amended by adding at the 

22 end the following: 

23 ‘‘(h) LIMITATION ON ELIGIBILITY TO PURCHASE A

24 CREDIT DEFAULT SWAP.—It shall be unlawful for any 


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1 person to enter into a credit default swap unless the per2 son— 

3 ‘‘(1) owns a credit instrument which is insured 

4 by the credit default swap; 

5 ‘‘(2) would experience financial loss if an event 

6 that is the subject of the credit default swap occurs 

7 with respect to the credit instrument; and 

8 ‘‘(3) meets such minimum capital adequacy 

9 standards as may be established by the Commission, 

10 in consultation with the Board of Governors of the 

11 Federal Reserve System, or such more stringent 

12 minimum capital adequacy standards as may be es13 tablished by or under the law of any State in which 

14 the swap is originated or entered into, or in which 

15 possession of the contract involved takes place.’’. 

16 (b) ELIMINATION OF PREEMPTION OF STATE

17 BUCKETING LAWS REGARDING NAKED CREDIT DEFAULT

18 SWAPS.—Section 12(e)(2)(B) of such Act (7 U.S.C. 

19 16(e)(2)(B)) is amended by inserting ‘‘(other than a credit 

20 default swap in which the purchaser of the swap would 

21 not experience financial loss if an event that is the subject 

22 of the swap occurred)’’ before ‘‘that is excluded’’. 

23 (c) DEFINITION OF CREDIT DEFAULT SWAP.—Sec24 tion 1a of such Act (7 U.S.C. 1a), as amended by section 


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1 351(a) of this Act, is amended by adding at the end the 

2 following: 

3 ‘‘(37) CREDIT DEFAULT SWAP.—The term 

4 ‘credit default swap’ means a contract which insures 

5 a party to the contract against the risk that an enti6 ty may experience a loss of value as a result of an 

7 event specified in the contract, such as a default or 

8 credit downgrade. A credit default swap that is trad9 ed on or cleared by a registered entity shall be ex10 cluded from the definition of a security as defined in 

11 this Act and in section 2(a)(1) of the Securities Act 

12 of 1933 or section 3(a)(10) of the Securities Ex13 change Act of 1934, except it shall be deemed a se14 curity solely for purpose of enforcing prohibitions 

15 against insider trading in sections 10 and 16 of the 

16 Securities Exchange Act of 1934.’’. 

17 (d) EFFECTIVE DATE.—The amendments made by 

18 this section shall be effective for credit default swaps (as 

19 defined in section 1a(37) of the Commodity Exchange Act) 

20 entered into after 60 days after the date of the enactment 

21 of this section. 

22 SEC. 356. TRANSACTION FEES. 

23 (a) IN GENERAL.—Section 12 of the Commodity Ex24 change Act (7 U.S.C. 16) is amended by redesignating 

25 subsections (e), (f), and (g) as subsections (f), (g), and 


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1 (h), respectively, and inserting after subsection (d) the fol2 lowing: 

3 ‘‘(e) CLEARING FEES.— 

4 ‘‘(1) IN GENERAL.—The Commission shall, in 

5 accordance with this subsection, charge and collect 

6 from each registered clearing organization, and each 

7 such organization shall pay to the Commission, 

8 transaction fees at a rate calculated to recover the 

9 costs to the Federal Government of the supervision 

10 and regulation of futures markets, except those di11 rectly related to enforcement. 

12 ‘‘(2) FEES ASSESSED PER SIDE OF CLEARED

13 CONTRACTS.— 

14 ‘‘(A) IN GENERAL.—The Commission shall 

15 determine the fee rate referred to in paragraph 

16 (1), and shall apply the fee rate per side of any 

17 transaction cleared. 

18 ‘‘(B) AUTHORITY TO DELEGATE.— The 

19 Commission may determine the procedures by 

20 which the fee rate is to be applied on the trans21 actions subject to the fee, or delegate the au22 thority to make the determination to any appro23 priate derivatives clearing organization. 

24 ‘‘(3) EXEMPTIONS.—The Commission may not 

25 impose a fee under paragraph (1) on— 


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1 ‘‘(A) a class of contracts or transactions if 

2 the Commission finds that it is in the public in3 terest to exempt the class from the fee; or 

4 ‘‘(B) a contract or transaction cleared by 

5 a registered derivatives clearing organization 

6 that is— 

7 ‘‘(i) subject to fees under section 31 

8 of the Securities Exchange Act of 1934; or 

9 ‘‘(ii) a security as defined in the Secu10 rities Act of 1933 or the Securities Ex11 change Act of 1934. 

12 ‘‘(4) DATES FOR PAYMENT OF FEES.—The fees 

13 imposed under paragraph (1) shall be paid on or be14 fore— 

15 ‘‘(A) March 15 of each year, with respect 

16 to transactions occurring on or after the pre17 ceding September 1 and on or before the pre18 ceding December 31; and 

19 ‘‘(B) September 15 of each year, with re20 spect to transactions occurring on or after the 

21 preceding January 1 and on or before the pre22 ceding August 31. 

23 ‘‘(5) ANNUAL ADJUSTMENT OF FEE RATES.— 

24 ‘‘(A) IN GENERAL.—Not later than April 

25 30 of each fiscal year , the Commission shall, 


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1 by order, adjust each fee rate determined under 

2 paragraph (2) for the fiscal year to a uniform 

3 adjusted rate that, when applied to the esti4 mated aggregate number of cleared sides of 

5 transactions for the fiscal year, is reasonably 

6 likely to produce aggregate fee receipts under 

7 this subsection for the fiscal year equal to the 

8 target offsetting receipt amount for the fiscal 

9 year. 

10 ‘‘(B) DEFINITIONS.—In subparagraph (A): 

11 ‘‘(i) ESTIMATED AGGREGATE NUMBER

12 OF CLEARED SIDES OF TRANSACTIONS.— 

13 The term ‘estimated aggregate number of 

14 cleared sides of transactions’ means, with 

15 respect to a fiscal year, the aggregate 

16 number of cleared sides of transactions to 

17 be cleared by registered derivatives clear18 ing organizations during the fiscal year, as 

19 estimated by the Commission, after con20 sultation with the Office of Management 

21 and Budget, using the methodology re22 quired for making projections pursuant to 

23 section 257 of the Balanced Budget and 

24 Emergency Deficit Control Act of 1985. 


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1 ‘‘(ii) TARGET OFFSETTING RECEIPT

2 AMOUNT.—The term ‘target offsetting re3 ceipt amount’ means, with respect to a fis4 cal year, the total level of Commission 

5 budget authority for all non-enforcement 

6 activities of the Commission, as contained 

7 in the regular appropriations Acts for the 

8 fiscal year. 

9 ‘‘(C) NO JUDICIAL REVIEW.—An adjusted 

10 fee rate prescribed under subparagraph (A) 

11 shall not be subject to judicial review. 

12 ‘‘(6) PUBLICATION.—Not later than April 30 of 

13 each fiscal year, the Commission shall cause to be 

14 published in the Federal Register notices of the fee 

15 rates applicable under this subsection for the suc16 ceeding fiscal year, and any estimate or projection 

17 on which the fee rates are based. 

18 ‘‘(7) ESTABLISHMENT OF FUTURES AND OP19 TIONS TRANSACTION FEE ACCOUNT; DEPOSIT OF

20 FEES.—There is established in the Treasury of the 

21 United States an account which shall be known as 

22 the ‘Futures and Options Transaction Fee Account’. 

23 All fees collected under this subsection for a fiscal 

24 year shall be deposited in the account. Amounts in 


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1 the account are authorized to be appropriated to 

2 fund the expenditures of the Commission.’’. 

3 (b) EFFECTIVE DATE.—The amendments made by 

4 subsection (a) shall apply to fiscal years beginning 30 or 

5 more days after the date of the enactment of this Act. 

6 (c) TRANSITION RULE.—If this section becomes law 

7 after March 31 and before September 1 of a fiscal year, 

8 then paragraphs (5)(A) and (6) of section 12(e) of the 

9 Commodity Exchange Act shall be applied, in the case of 

10 the 1st fiscal year beginning after the date of the enact11 ment of this Act, by substituting ‘‘August 31’’ for ‘‘April 

12 30’’. 

13 SEC. 357. NO EFFECT ON ANTITRUST LAW OR AUTHORITY 

14 OF THE FEDERAL TRADE COMMISSION. 

15 (a) Nothing in this subtitle shall be construed to mod16 ify, impair, or supersede the operation of any of the anti17 trust laws. For purposes of this subsection, the term 

18 ‘‘antitrust laws’’ has the meaning given it in subsection 

19 (a) of the 1st section of the Clayton Act (15 U.S.C. 12(a)), 

20 except that such term includes section 5 of the Federal 

21 Trade Commission Act (15 U.S.C. 45) to the extent that 

22 such term applies to unfair methods of competition. 

23 (b) Nothing in this subtitle shall be construed to af24 fect or diminish the jurisdiction or authority of the Fed25 eral Trade Commission with respect to its authorities 


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1 under the Federal Trade Commission Act (15 U.S.C. 41 

2 et seq.) or the Energy Independence and Security Act of 

3 2007 (Public Law 110–140) to obtain information, to 

4 carry out enforcement activities, or otherwise to carry out 

5 the responsibilities of the Federal Trade Commission. 

6 SEC. 358. REGULATION OF CARBON DERIVATIVES MAR7 KETS. 

8 (a) DEFAULT RULE.—Section 2 of the Commodity 

9 Exchange Act (7 U.S.C. 2), as amended by section 352 

10 of this Act, is amended by adding at the end the following: 

11 ‘‘(k) The Commission shall have jurisdiction over the 

12 establishment, operations, and oversight of markets for 

13 regulated allowance derivatives (as defined in section 401 

14 of the Federal Power Act (16 U.S.C. 791a and following)), 

15 and shall provide for the establishment, operation, and 

16 oversight of the markets in accordance with the same reg17 ulations that apply under this Act to included energy 

18 transactions.’’. 

19 (b) PRESIDENTIAL DETERMINATIONS.—To the ex20 tent that the President delegates the authority to promul21 gate regulations for the establishment, operation, and 

22 oversight of all markets for regulated allowance derivatives 

23 to a Federal agency other than the Commodity Futures 

24 Trading Commission pursuant to section 401 of the Fed25 eral Power Act, such determination shall supersede subVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00913 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 section (a). To the extent that the President determines 

2 that regulations promulgated pursuant to section 

3 401(c)(2) of the Federal Power Act would provide for 

4 more stringent and effective market oversight, such regu5 lations shall supersede subsection (a). Nothing in this sec6 tion shall be construed to affect the operation of the de7 fault rules established in section 401(c)(4) of the Federal 

8 Power Act. 

9 SEC. 359. CEASE-AND-DESIST AUTHORITY. 

10 (a) NATURAL GAS ACT.—Section 20 of the Natural 

11 Gas Act (15 U.S.C. 717s) is amended by adding the fol12 lowing at the end: 

13 ‘‘(e) CEASE-AND-DESIST PROCEEDINGS; TEMPORARY

14 ORDERS; AUTHORITY OF THE COMMISSION.— 

15 ‘‘(1) IN GENERAL.—If the Commission finds, 

16 after notice and opportunity for hearing, that any 

17 entity may be violating, may have violated, or may 

18 be about to violate any provision of this Act, or any 

19 rule, regulation, restriction, condition, or order made 

20 or imposed by the Commission under the authority 

21 of this Act, the Commission may publish its findings 

22 and issue an order requiring such entity, and any 

23 other entity that is, was, or would be a cause of the 

24 violation, due to an act or omission the entity knew 

25 or should have known would contribute to such vioVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00914 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 lation, to cease and desist from committing or caus2 ing such violation and any future violation of the 

3 same provision, rule, or regulation. Such order may, 

4 in addition to requiring an entity to cease and desist 

5 from committing or causing a violation, require such 

6 entity to comply, to provide an accounting and 

7 disgorgement, or to take steps to effect compliance, 

8 with such provision, rule, or regulation, upon such 

9 terms and conditions and within such time as the 

10 Commission may specify in such order. Any such 

11 order may, as the Commission deems appropriate, 

12 require future compliance or steps to effect future 

13 compliance, either permanently or for such period of 

14 time as the Commission may specify. 

15 ‘‘(2) TIMING OF ENTRY.—An order issued 

16 under this subsection shall be entered only after no17 tice and opportunity for a hearing, unless the Com18 mission determines that notice and hearing prior to 

19 entry would be impracticable or contrary to the pub20 lic interest. 

21 ‘‘(f) HEARING.—The notice instituting proceedings 

22 pursuant to subsection (e) shall fix a hearing date not ear23 lier than 30 days nor later than 60 days after service of 

24 the notice unless an earlier or a later date is set by the 

25 Commission with the consent of any respondent so served. 


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1 ‘‘(g) TEMPORARY ORDER.—Whenever the Commis2 sion determines that-— 

3 ‘‘(1) a respondent may take actions to dissipate 

4 or convert assets prior to the completion of the pro5 ceedings referred to in subsection (e), and such as6 sets would be necessary to comply with or otherwise 

7 satisfy a final enforcement order of the Commission 

8 pursuant to alleged violations or threatened viola9 tions specified in the notice instituting proceedings; 

10 or 

11 ‘‘(2) a respondent is engaged in actual or 

12 threatened violations of this Act or a Commission 

13 rule, regulation, restriction or order referred to in 

14 subsection (e), 

15 the Commission may issue a temporary order requiring 

16 the respondent to take such action to prevent dissipation 

17 or conversion of assets, significant harm to energy con18 sumers, or substantial harm to the public interest, frustra19 tion of the Commission’s ability to conduct the pro20 ceedings, or frustration of the Commission’s ability to re21 dress said violation at the conclusion of the proceedings, 

22 as the Commission deems appropriate pending completion 

23 of such proceedings. 

24 ‘‘(h) REVIEW OF TEMPORARY ORDERS.— 


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1 ‘‘(1) COMMISSION REVIEW.—At any time after 

2 the respondent has been served with a temporary 

3 cease-and-desist order pursuant to subsection (g), 

4 the respondent may apply to the Commission to have 

5 the order set aside, limited, or suspended. If the re6 spondent has been served with a temporary cease7 and-desist order entered without a prior Commission 

8 hearing, the respondent may, within 10 days after 

9 the date on which the order was served, request a 

10 hearing on such application and the Commission 

11 shall hold a hearing and render a decision on such 

12 application at the earliest possible time. 

13 ‘‘(2) JUDICIAL REVIEW.—Within— 

14 ‘‘(A) 10 days after the date the respondent 

15 was served with a temporary cease-and-desist 

16 order entered with a prior Commission hearing; 

17 or 

18 ‘‘(B) 10 days after the Commission ren19 ders a decision on an application and hearing 

20 under paragraph (1), 

21 with respect to any temporary cease-and-desist order 

22 entered without a prior Commission hearing, the re23 spondent may apply to the United States circuit 

24 court having jurisdiction over the circuit in which 

25 the respondent resides or has its principal place of 


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1 business, or to the United States Court of Appeals 

2 for the District of Columbia Circuit, for an order 

3 setting aside, limiting, or suspending the effective4 ness or enforcement of the order, and the court shall 

5 have jurisdiction to enter such an order. A respond6 ent served with a temporary cease-and-desist order 

7 entered without a prior Commission hearing may not 

8 apply to the court except after hearing and decision 

9 by the Commission on the respondent’s application 

10 under paragraph (1) of this subsection. 

11 ‘‘(3) NO AUTOMATIC STAY OF TEMPORARY

12 ORDER.—The commencement of proceedings under 

13 paragraph (2) of this subsection shall not, unless 

14 specifically ordered by the court, operate as a stay 

15 of the Commission’s order. 

16 ‘‘(4) EXCLUSIVE REVIEW.—Sections 19(d) and 

17 24 shall not apply to a temporary order entered pur18 suant to this section. 

19 ‘‘(i) IMPLEMENTATION.—The Commission is author20 ized to adopt rules, regulations, and orders as it deems 

21 appropriate to implement this section.’’. 

22 (c) NATURAL GAS POLICY ACT OF 1978.—Section 

23 504 of the Natural Gas Policy Act of 1978 (15 U.S.C. 

24 3414) is amended by adding the following at the end: 


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1 ‘‘(d) CEASE-AND-DESIST PROCEEDINGS; TEMPORARY

2 ORDERS; AUTHORITY OF THE COMMISSION.— 

3 ‘‘(1) IN GENERAL.—If the Commission finds, 

4 after notice and opportunity for hearing, that any 

5 entity may be violating, may have violated, or may 

6 be about to violate any provision of this Act, or any 

7 rule, regulation, restriction, condition, or order made 

8 or imposed by the Commission under the authority 

9 of this Act, the Commission may publish its findings 

10 and issue an order requiring such entity, and any 

11 other entity that is, was, or would be a cause of the 

12 violation, due to an act or omission the entity knew 

13 or should have known would contribute to such vio14 lation, to cease and desist from committing or caus15 ing such violation and any future violation of the 

16 same provision, rule, or regulation. Such order may, 

17 in addition to requiring an entity to cease and desist 

18 from committing or causing a violation, require such 

19 entity to comply, to provide an accounting and 

20 disgorgement, or to take steps to effect compliance, 

21 with such provision, rule, or regulation, upon such 

22 terms and conditions and within such time as the 

23 Commission may specify in such order. Any such 

24 order may, as the Commission deems appropriate, 

25 require future compliance or steps to effect future 


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1 compliance, either permanently or for such period of 

2 time as the Commission may specify. 

3 ‘‘(2) TIMING OF ENTRY.—An order issued 

4 under this subsection shall be entered only after no5 tice and opportunity for a hearing, unless the Com6 mission determines that notice and hearing prior to 

7 entry would be impracticable or contrary to the pub8 lic interest. 

9 ‘‘(3) HEARING.—The notice instituting pro10 ceedings pursuant to paragraph (1) shall fix a hear11 ing date not earlier than 30 days nor later than 60 

12 days after service of the notice unless an earlier or 

13 a later date is set by the Commission with the con14 sent of any respondent so served. 

15 ‘‘(4) TEMPORARY ORDER.—Whenever the Com16 mission determines that— 

17 ‘‘(A) a respondent may take actions to dis18 sipate or convert assets prior to the completion 

19 of the proceedings referred to in paragraph (1) 

20 and such assets would be necessary to comply 

21 with or otherwise satisfy a final enforcement 

22 order of the Commission pursuant to alleged 

23 violations or threatened violations specified in 

24 the notice instituting proceedings; or 


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1 ‘‘(B) a respondent is engaged in actual or 

2 threatened violations of this Act or a Commis3 sion rule, regulation, restriction or order re4 ferred to in paragraph (1), 

5 the Commission may issue a temporary order requir6 ing the respondent to take such action to prevent 

7 dissipation or conversion of assets, significant harm 

8 to energy consumers, or substantial harm to the 

9 public interest, frustration of the Commission’s abil10 ity to conduct the proceedings, or frustration of the 

11 Commission’s ability to redress said violation at the 

12 conclusion of the proceedings, as the Commission 

13 deems appropriate pending completion of such pro14 ceedings. 

15 ‘‘(5) REVIEW OF TEMPORARY ORDERS.— 

16 ‘‘(A) COMMISSION REVIEW.—At any time 

17 after the respondent has been served with a 

18 temporary cease-and-desist order pursuant to 

19 paragraph (4), the respondent may apply to the 

20 Commission to have the order set aside, limited, 

21 or suspended. If the respondent has been served 

22 with a temporary cease-and-desist order entered 

23 without a prior Commission hearing, the re24 spondent may, within 10 days after the date on 

25 which the order was served, request a hearing 


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1 on such application and the Commission shall 

2 hold a hearing and render a decision on such 

3 application at the earliest possible time. 

4 ‘‘(B) JUDICIAL REVIEW.—Within— 

5 ‘‘(i) 10 days after the date the re6 spondent was served with a temporary 

7 cease-and-desist order entered with a prior 

8 Commission hearing; or 

9 ‘‘(ii) 10 days after the Commission 

10 renders a decision on an application and 

11 hearing under subparagraph (A), with re12 spect to any temporary cease-and-desist 

13 order entered without a prior Commission 

14 hearing, the respondent may apply to the 

15 United States circuit court having jurisdic16 tion over the circuit in which the respond17 ent resides or has its principal place of 

18 business, or to the United States Court of 

19 Appeals for the District of Columbia Cir20 cuit, for an order setting aside, limiting, or 

21 suspending the effectiveness or enforce22 ment of the order, and the court shall have 

23 jurisdiction to enter such an order. A re24 spondent served with a temporary cease25 and-desist order entered without a prior 


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1 Commission hearing may not apply to the 

2 court except after hearing and decision by 

3 the Commission on the respondent’s appli4 cation under paragraph (1) of this sub5 section. 

6 ‘‘(C) NO AUTOMATIC STAY OF TEMPORARY

7 ORDER.—The commencement of proceedings 

8 under subparagraph (B) of this paragraph shall 

9 not, unless specifically ordered by the court, op10 erate as a stay of the Commission’s order. 

11 ‘‘(6) IMPLEMENTATION.—The Commission is 

12 authorized to adopt rules, regulations, and orders as 

13 it deems appropriate to implement this subsection.’’. 

14 TITLE IV—TRANSITIONING TO A 

15 CLEAN ENERGY ECONOMY 

16 Subtitle A—Ensuring Real 

17 Reductions in Industrial Emissions 

18 SEC. 401. ENSURING REAL REDUCTIONS IN INDUSTRIAL 

19 EMISSIONS. 

20 Title VII of the Clean Air Act is amended by insert21 ing after part E the following new part: 


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1 ‘‘PART F—ENSURING REAL REDUCTIONS IN 

2 INDUSTRIAL EMISSIONS 

3 ‘‘SEC. 761. PURPOSES. 

4 ‘‘(a) PURPOSE OF PART.—The purposes of this part 

5 are— 

6 ‘‘(1) to promote a strong global effort to signifi7 cantly reduce greenhouse gas emissions, and, 

8 through this global effort, stabilize greenhouse gas 

9 concentrations in the atmosphere at a level that will 

10 prevent dangerous anthropogenic interference with 

11 the climate system; and 

12 ‘‘(2) to prevent an increase in greenhouse gas 

13 emissions in countries other than the United States 

14 as a result of direct and indirect compliance costs in15 curred under this title. 

16 ‘‘(b) PURPOSES OF SUBPART 1.—The purposes of 

17 subpart 1 are additionally— 

18 ‘‘(1) to rebate the owners and operators of enti19 ties in domestic eligible industrial sectors for their 

20 greenhouse gas emission costs incurred under this 

21 title, but not for costs associated with other related 

22 or unrelated market dynamics; 

23 ‘‘(2) to design such rebates in a way that will 

24 prevent carbon leakage while also rewarding innova25 tion and facility-level investments in energy effi26 ciency performance improvements; and 


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1 ‘‘(3) to eliminate or reduce distribution of emis2 sion allowances under this part when such distribu3 tion is no longer necessary to prevent carbon leakage 

4 from eligible industrial sectors. 

5 ‘‘SEC. 762. INTERNATIONAL NEGOTIATIONS. 

6 ‘‘(a) FINDING.—Congress finds that the purposes of 

7 this part, as set forth in section 761, can be most effec8 tively addressed and achieved through agreements nego9 tiated between the United States and foreign countries. 

10 ‘‘(b) STATEMENT OF POLICY.—It is the policy of the 

11 United States to work proactively under the United Na12 tions Framework Convention on Climate Change, and in 

13 other appropriate forums, to establish binding agreements, 

14 including sectoral agreements, committing all major 

15 greenhouse gas-emitting nations to contribute equitably to 

16 the reduction of global greenhouse gas emissions. 

17 ‘‘(c) NOTIFICATION OF FOREIGN COUNTRIES.—Not 

18 later than January 1, 2020, the President shall notify for19 eign countries that an International Reserve Allowance 

20 Program, as described in subpart 2, may apply to primary 

21 products produced in a foreign country by a sector with 

22 respect to which the President has made a determination 

23 under section 767(b) that 70 percent or less of the global 

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1 tries that have met one or more of the criteria in that 

2 subsection. 

3 ‘‘SEC. 763. DEFINITIONS. 

4 ‘‘In this part: 

5 ‘‘(1) CARBON LEAKAGE.—The term ‘carbon 

6 leakage’ means any substantial increase (as deter7 mined by the Administrator) in greenhouse gas 

8 emissions by industrial entities located in other 

9 countries if such increase is caused by an incre10 mental cost of production increase in the United 

11 States resulting from the implementation of this 

12 title. 

13 ‘‘(2) ELIGIBLE INDUSTRIAL SECTOR.—The 

14 term ‘eligible industrial sector’ means an industrial 

15 sector determined by the Administrator under sec16 tion 764(b) to be eligible to receive emission allow17 ance rebates under subpart 1. 

18 ‘‘(3) INDUSTRIAL SECTOR.—The term ‘indus19 trial sector’ means any sector that is in the manu20 facturing sector (as defined in NAICS codes 31, 32, 

21 and 33). 

22 ‘‘(4) NAICS.—The term ‘NAICS’ means the 

23 North American Industrial Classification System of 

24 2002. 


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1 ‘‘(5) OUTPUT.—The term ‘output’ means the 

2 total tonnage or other standard unit of production 

3 (as determined by the Administrator) produced by 

4 an entity in an industrial sector. The output of the 

5 cement sector is hydraulic cement, and not clinker. 

6 ‘‘(6) PRIMARY PRODUCT.—The term ‘primary 

7 product’ means a product manufactured by an eligi8 ble industrial sector that is— 

9 ‘‘(A) iron, steel, steel mill products (includ10 ing pipe and tube), aluminum, cement, glass 

11 (including flat, container, and specialty glass 

12 and fiberglass), pulp, paper, chemicals, or in13 dustrial ceramics; or 

14 ‘‘(B) any other manufactured product that 

15 is sold in bulk for purposes of further manufac16 ture or inclusion in a finished product. 

17 ‘‘Subpart 1—Emission Allowance Rebate Program 

18 ‘‘SEC. 764. ELIGIBLE INDUSTRIAL SECTORS. 

19 ‘‘(a) LIST.— 

20 ‘‘(1) INITIAL LIST.—Not later than June 30, 

21 2011, the Administrator shall publish in the Federal 

22 Register a list of eligible industrial sectors pursuant 

23 to subsection (b). Such list shall include the amount 

24 of the emission allowance rebate per unit of produc25 tion that shall be provided to entities in each eligible 


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1 industrial sector in the following two calendar years 

2 pursuant to section 765. 

3 ‘‘(2) SUBSEQUENT LISTS.—Not later than Feb4 ruary 1, 2013, and every four years thereafter, the 

5 Administrator shall publish in the Federal Register 

6 an updated version of the list published under para7 graph (1). 

8 ‘‘(b) ELIGIBLE INDUSTRIAL SECTORS.— 

9 ‘‘(1) IN GENERAL.—Not later than June 30, 

10 2011, the Administrator shall promulgate a rule des11 ignating, based on the criteria under paragraph (2), 

12 the industrial sectors eligible for emission allowance 

13 rebates under this subpart. 

14 ‘‘(2) PRESUMPTIVELY ELIGIBLE INDUSTRIAL

15 SECTORS.— 

16 ‘‘(A) ELIGIBILITY CRITERIA.—An owner or 

17 operator of an entity shall be eligible to receive 

18 emission allowance rebates under this subpart if 

19 such entity is in an industrial sector that is in20 cluded in a six-digit classification of the NAICS 

21 that meets the criteria in both clauses (i) and 

22 (ii), or the criteria in clause (iii). 

23 ‘‘(i) ENERGY OR GREENHOUSE GAS

24 INTENSITY.—As determined by the Admin25 istrator, the industrial sector had— 


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1 ‘‘(I) an energy intensity of at 

2 least 5 percent, calculated by dividing 

3 the cost of purchased electricity and 

4 fuel costs of the sector by the value of 

5 the shipments of the sector, based on 

6 data described in subparagraph (E); 

7 or 

8 ‘‘(II) a greenhouse gas intensity 

9 of at least 5 percent, calculated by di10 viding— 

11 ‘‘(aa) the number 20 multi12 plied by the number of tons of 

13 carbon dioxide equivalent green14 house gas emissions (including 

15 direct emissions from fuel com16 bustion, process emissions, and 

17 indirect emissions from the gen18 eration of electricity used to 

19 produce the output of the sector) 

20 of the sector based on data de21 scribed in subparagraph (E); by 

22 ‘‘(bb) the value of the ship23 ments of the sector, based on 

24 data described in subparagraph 

25 (E). 


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1 ‘‘(ii) TRADE INTENSITY.—As deter2 mined by the Administrator, the industrial 

3 sector had a trade intensity of at least 15 

4 percent, calculated by dividing the value of 

5 the total imports and exports of such sec6 tor by the value of the shipments plus the 

7 value of imports of such sector, based on 

8 data described in subparagraph (E). 

9 ‘‘(iii) VERY HIGH ENERGY OR GREEN10 HOUSE GAS INTENSITY.—As determined by 

11 the Administrator, the industrial sector 

12 had an energy or greenhouse gas intensity, 

13 as calculated under clause (i)(I) or (II), of 

14 at least 20 percent. 

15 ‘‘(B) IRON AND STEEL SECTOR.—For pur16 poses of this subpart, in carrying out this sec17 tion and section 765, the Administrator shall 

18 consider as in different industrial sectors— 

19 ‘‘(i) entities using integrated iron and 

20 steelmaking technologies (including coke 

21 ovens, blast furnaces, and other iron-mak22 ing technologies); and 

23 ‘‘(ii) entities using electric arc furnace 

24 technologies. 


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1 ‘‘(C) METAL AND PHOSPHATE PRODUC2 TION CLASSIFIED UNDER MORE THAN ONE

3 NAICS CODE.—For purposes of this subpart, in 

4 carrying out this section and section 765, the 

5 Administrator shall— 

6 ‘‘(i) aggregate data for the 

7 beneficiation or other processing of iron 

8 and copper ores and phosphate with subse9 quent steps in the process of metal and 

10 phosphate manufacturing regardless of the 

11 NAICS code under which such activity is 

12 classified; and 

13 ‘‘(ii) aggregate data for the manufac14 turing of steel with the manufacturing of 

15 steel pipe and tube made from purchased 

16 steel in a nonintegrated process. 

17 ‘‘(D) EXCLUSION.—The petroleum refining 

18 sector shall not be an eligible industrial sector. 

19 ‘‘(E) DATA SOURCES.— 

20 ‘‘(i) ELECTRICITY AND FUEL COSTS, 

21 VALUE OF SHIPMENTS.—The Adminis22 trator shall determine electricity and fuel 

23 costs and the value of shipments under 

24 this subsection from data from the United 

25 States Census of Mineral Industries and 


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1 the United States Census Annual Survey 

2 of Manufacturers. The Administrator shall 

3 take the average of data from as many of 

4 the years of 2004, 2005, and 2006 for 

5 which such data are available. If such data 

6 are unavailable, the Administrator shall 

7 make a determination based upon 2002 or 

8 2006 data from the most detailed indus9 trial classification level of Energy Informa10 tion Agency’s Manufacturing Energy Con11 sumption Survey (using 2006 data if it is 

12 available) and the 2002 or 2007 Economic 

13 Census of the United States (using 2007 

14 data if it is available). If data from the 

15 Manufacturing Energy Consumption Sur16 vey are unavailable for any sector at the 

17 six-digit classification level in the NAICS, 

18 then the Administrator may extrapolate 

19 the information necessary to determine the 

20 eligibility of a sector under this paragraph 

21 from available Manufacturing Energy Con22 sumption Survey data pertaining to a 

23 broader industrial category classified in the 

24 NAICS. Fuel cost data shall not include 


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1 the cost of fuel used as feedstock by an in2 dustrial sector. 

3 ‘‘(ii) IMPORTS AND EXPORTS.—The 

4 Administrator shall base the value of im5 ports and exports under this subsection on 

6 United States International Trade Com7 mission data. The Administrator shall take 

8 the average of data from as many of the 

9 years of 2004, 2005, and 2006 for which 

10 such data are available. 

11 ‘‘(iii) PERCENTAGES.—The Adminis12 trator shall round the energy intensity, 

13 greenhouse gas intensity, and trade inten14 sity percentages under subparagraph (A) 

15 to the nearest whole number. 

16 ‘‘(iv) GREENHOUSE GAS EMISSION

17 CALCULATIONS.—When calculating the 

18 tons of carbon dioxide equivalent green19 house gas emissions for each sector under 

20 subparagraph (A)(i)(II)(aa), the Adminis21 trator— 

22 ‘‘(I) shall use the best available 

23 data from as many of the years 2004, 

24 2005, and 2006 for which such data 

25 is available; and 


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1 ‘‘(II) may, to the extent nec2 essary with respect to a sector, use 

3 economic and engineering models and 

4 the best available information on tech5 nology performance levels for such 

6 sector. 

7 ‘‘(3) ADMINISTRATIVE DETERMINATION OF AD8 DITIONAL ELIGIBLE INDUSTRIAL SECTORS.— 

9 ‘‘(A) UPDATED TRADE INTENSITY DATA.— 

10 The Administrator shall designate as eligible to 

11 receive emission allowance rebates under this 

12 subpart an industrial sector that— 

13 ‘‘(i) met the energy or greenhouse gas 

14 intensity criteria in paragraph (2)(A)(i) as 

15 of the date of promulgation of the rule 

16 under paragraph (1); and 

17 ‘‘(ii) meets the trade intensity criteria 

18 in paragraph (2)(A)(ii), using data from 

19 any year after 2006. 

20 ‘‘(B) INDIVIDUAL SHOWING PETITION.— 

21 ‘‘(i) PETITION.—In addition to des22 ignation under paragraph (2) or subpara23 graph (A) of this paragraph, the owner or 

24 operator of an entity in an industrial sec25 tor may petition the Administrator to desVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00934 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ignate as eligible industrial sectors under 

2 this subpart an entity or a group of enti3 ties that— 

4 ‘‘(I) represent a subsector of a 

5 six-digit section of the NAICS code; 

6 and 

7 ‘‘(II) meet the eligibility criteria 

8 in both clauses (i) and (ii) of para9 graph (2)(A), or the eligibility criteria 

10 in clause (iii) of paragraph (2)(A). 

11 ‘‘(ii) DATA.—In making a determina12 tion under this subparagraph, the Admin13 istrator shall consider data submitted by 

14 the petitioner that is specific to the entity, 

15 data solicited by the Administrator from 

16 other entities in the subsector, if such 

17 other entities exist, and data specified in 

18 paragraph (2)(E). 

19 ‘‘(iii) BASIS OF SUBSECTOR DETER20 MINATION.—The Administrator shall de21 termine an entity or group of entities to be 

22 a subsector of a six-digit section of the 

23 NAICS code based only upon the products 

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1 tured, except that the Administrator may 

2 determine an entity or group of entities 

3 that manufacture a product from a øvirgin 

4 material¿ to be a separate subsector from 

5 another entity or group of entities that 

6 manufacture the same product from recy7 cled material. 

8 ‘‘(iv) USE OF MOST RECENT DATA.— 

9 In determining whether to designate a sec10 tor or subsector as an eligible industrial 

11 sector under this subparagraph, the Ad12 ministrator shall use the most recent data 

13 available from the sources described in 

14 paragraph (2)(E), rather than the data 

15 from the years specified in paragraph 

16 (2)(E), to determine the trade intensity of 

17 such sector or subsector, but only for de18 termining such trade intensity. 

19 ‘‘(v) FINAL ACTION.—The Adminis20 trator shall take final action on such peti21 tion no later than 6 months after the peti22 tion is received by the Administrator. 

23 ‘‘SEC. 765. DISTRIBUTION OF EMISSION ALLOWANCE RE24 BATES. 

25 ‘‘(a) DISTRIBUTION SCHEDULE.— 


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1 ‘‘(1) IN GENERAL.—For each vintage year, the 

2 Administrator shall distribute pursuant to this sec3 tion emission allowances made available under sec4 tion 782(e), no later than October 31 of the pre5 ceding calendar year. The Administrator shall make 

6 such annual distributions to the owners and opera7 tors of each entity in an eligible industrial sector in 

8 the amount of emission allowances calculated under 

9 subsection (b), except that— 

10 ‘‘(A) for vintage years 2012 and 2013, the 

11 distribution for a covered entity shall be the en12 tity’s indirect carbon factor as calculated under 

13 subsection (b)(3); and 

14 ‘‘(B) for vintage year 2026 and thereafter, 

15 the distribution shall be the amount calculated 

16 under subsection (b) multiplied by, except as 

17 modified by the President pursuant to section 

18 767(c)(3)(A) for a sector— 

19 ‘‘(i) 90 percent for vintage year 2026; 

20 ‘‘(ii) 80 percent for vintage year 

21 2027; 

22 ‘‘(iii) 70 percent for vintage year 

23 2028; 

24 ‘‘(iv) 60 percent for vintage year 

25 2029; 


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1 ‘‘(v) 50 percent for vintage year 2030; 

2 ‘‘(vi) 40 percent for vintage year 

3 2031; 

4 ‘‘(vii) 30 percent for vintage year 

5 2032; 

6 ‘‘(viii) 20 percent for vintage year 

7 2033; 

8 ‘‘(ix) 10 percent for vintage year 

9 2034; and 

10 ‘‘(x) 0 percent for vintage year 2035 

11 and thereafter. 

12 ‘‘(2) RESUMPTION OF REDUCTION.—If the 

13 President has modified the percentage stated in 

14 paragraph (1)(B) under section 767(c)(3)(A), and 

15 the President subsequently makes a determination 

16 under section 767(b) for an eligible industrial sector 

17 that more than 70 percent of global output for that 

18 sector is produced or manufactured in countries that 

19 have met at least one of the criteria in that sub20 section, then the 10-year reduction schedule set 

21 forth in paragraph (1)(B) of this subsection shall 

22 begin in the next vintage year, with the percentage 

23 reduction based on the amount of the distribution of 

24 emission allowances under this section in the pre25 vious year. 


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1 ‘‘(3) NEWLY ELIGIBLE SECTORS.—In addition 

2 to receiving a distribution of emission allowances 

3 under this section in the first distribution occurring 

4 after an industrial sector is designated as eligible 

5 under section 764(b)(3), the owner or operator of an 

6 entity in that eligible industrial sector may receive a 

7 prorated share of any emission allowances made 

8 available for distribution under this section that 

9 were not distributed for the year in which the peti10 tion for eligibility was granted under section 

11 764(b)(3)(B). 

12 ‘‘(b) CALCULATION OF DIRECT AND INDIRECT CAR13 BON FACTORS.— 

14 ‘‘(1) IN GENERAL.— 

15 ‘‘(A) COVERED ENTITIES.—Except as pro16 vided in subsection (a), for covered entities that 

17 are in eligible industrial sectors, the amount of 

18 emission allowance rebates shall be based on 

19 the sum of the covered entity’s direct and indi20 rect carbon factors. 

21 ‘‘(B) OTHER ELIGIBLE ENTITIES.—For 

22 entities that are in eligible industrial sectors 

23 but are not covered entities, the amount of 

24 emission allowance rebates shall be based on 

25 the entity’s indirect carbon factor. 


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1 ‘‘(C) NEW ENTITIES.—Not later than 2 

2 years after the date of enactment of this title, 

3 the Administrator shall issue regulations gov4 erning the distribution of emission allowance re5 bates for the first and second years of operation 

6 of a new entity in an eligible industrial sector. 

7 These regulations shall provide for— 

8 ‘‘(i) the distribution of emission allow9 ance rebates to such entities based on com10 parable entities in the same sector; and 

11 ‘‘(ii) an adjustment in the third and 

12 fourth years of operation to reconcile the 

13 total amount of emission allowance rebates 

14 received during the first and second years 

15 of operation to the amount the entity 

16 would have received during the first and 

17 second years of operation had the appro18 priate data been available. 

19 ‘‘(2) DIRECT CARBON FACTOR.—The direct car20 bon factor for a covered entity for a vintage year is 

21 the product of— 

22 ‘‘(A) the average output of the covered en23 tity for the two years preceding the year of the 

24 distribution; and 


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1 ‘‘(B) the most recent calculation of the av2 erage direct greenhouse gas emissions (ex3 pressed in tons of carbon dioxide equivalent) 

4 per unit of output for all covered entities in the 

5 sector, as determined by the Administrator 

6 under paragraph (4). 

7 ‘‘(3) INDIRECT CARBON FACTOR.— 

8 ‘‘(A) IN GENERAL.—The indirect carbon 

9 factor for an entity for a vintage year is the 

10 product obtained by multiplying the average 

11 output of the entity for the two years preceding 

12 the year of the distribution by both the elec13 tricity emissions intensity factor determined 

14 pursuant to subparagraph (B) and the elec15 tricity efficiency factor determined pursuant to 

16 subparagraph (C) for the year concerned. 

17 ‘‘(B) ELECTRICITY EMISSIONS INTENSITY

18 FACTOR.—Each person selling electricity to the 

19 owner or operator of an entity in any sector 

20 designated as an eligible industrial sector under 

21 section 764(b) shall provide the owner or oper22 ator of the entity and the Administrator, on an 

23 annual basis, the electricity emissions intensity 

24 factor for the entity. øThe electricity emissions 

25 intensity factor for the entity, expressed in tons 


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•HR 2998 IH

1 of carbon dioxide equivalents per kilowatt hour, 

2 is determined by dividing—¿ 

3 ø‘‘(i) the annual sum of the hourly 

4 product of—¿ 

5 ø‘‘(I) the electricity purchased by 

6 the entity from that person in each 

7 hour (expressed in kilowatt hours); 

8 multiplied by¿ 

9 ø‘‘(II) the marginal øor¿ weight10 ed øaverage¿ tons of carbon dioxide 

11 equivalent per kilowatt hour that the 

12 person selling the electricity 

13 øcharges¿ to the entity, taking into 

14 account the entity’s retail rate ar15 rangements; by¿ 

16 ø‘‘(ii) the total kilowatt hours of elec17 tricity purchased by the entity from that 

18 person during that year.¿ 

19 ‘‘(C) ELECTRICITY EFFICIENCY FACTOR.— 

20 The electricity efficiency factor is the average 

21 amount of electricity (in kilowatt hours) used 

22 per unit of output for all entities in the relevant 

23 sector, as determined by the Administrator 

24 based on the best available data, including data 

25 provided under paragraph (6). 


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1 ‘‘(D) INDIRECT CARBON FACTOR REDUC2 TION.—If an electricity provider received a free 

3 allocation of emission allowances pursuant to 

4 section 782(a), the Administrator shall adjust 

5 the indirect carbon factor to avoid rebates to 

6 the eligible entity for costs that the Adminis7 trator determines were not incurred by the in8 dustrial entity because the allowances were free9 ly allocated to the eligible entity’s electricity 

10 provider and used for the benefit of industrial 

11 consumers. 

12 ‘‘(4) GREENHOUSE GAS INTENSITY CALCULA13 TIONS.—The Administrator shall calculate the aver14 age direct greenhouse gas emissions (expressed in 

15 tons of carbon dioxide equivalent) per unit of output 

16 for all covered entities in each eligible industrial sec17 tor every four years using an average of the two 

18 most recent years of the best available data. 

19 ‘‘(5) ENSURING EFFICIENCY IMPROVEMENTS.— 

20 When making greenhouse gas calculations, the Ad21 ministrator shall— 

22 ‘‘(A) limit the average direct greenhouse 

23 gas emissions per unit of output, calculated 

24 under paragraph (4), for any eligible industrial 

25 sector to an amount that is not greater than it 


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1 was in any previous calculation under this sub2 section; and 

3 ‘‘(B) limit the electricity emissions inten4 sity factor, calculated under paragraph (3)(B) 

5 and resulting from a change in electricity sup6 ply, for any entity to an amount that is not 

7 greater than it was during any previous year. 

8 ‘‘(6) DATA SOURCES.—For the purposes of this 

9 subsection— 

10 ‘‘(A) the Administrator shall use data from 

11 the greenhouse gas registry established under 

12 section 713, where it is available; and 

13 ‘‘(B) each owner or operator of an entity 

14 in an eligible industrial sector and each depart15 ment, agency, and instrumentality of the 

16 United States shall provide the Administrator 

17 with such information as the Administrator 

18 finds necessary to determine the direct carbon 

19 factor and the indirect carbon factor for each 

20 entity subject to this section. 

21 ‘‘(c) TOTAL MAXIMUM DISTRIBUTION.—Notwith22 standing subsections (a) and (b), the Administrator shall 

23 not distribute more allowances for any vintage year pursu24 ant to this section than are allocated for use under this 

25 part pursuant to section 782(e) for that vintage year. For 


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•HR 2998 IH

1 any vintage year for which the total emission allowance 

2 rebates calculated pursuant to this section exceed the 

3 number of allowances allocated pursuant to section 782(e), 

4 the Administrator shall reduce each entity’s distribution 

5 on a pro rata basis so that the total distribution under 

6 this section equals the number of allowances allocated 

7 under section 782(e). 

8 ‘‘Subpart 2—International Reserve Allowance 

9 Program 

10 ‘‘SEC. 766. INTERNATIONAL RESERVE ALLOWANCE PRO11 GRAM. 

12 ‘‘(a) ESTABLISHMENT.— 

13 ‘‘(1) IN GENERAL.—If the President takes an 

14 action described in section 767(c)(3)(B) with respect 

15 to a sector then, not later than 24 months after that 

16 determination, the Administrator shall issue regula17 tions— 

18 ‘‘(A) determining an appropriate price for 

19 and offering for sale to United States importers 

20 international reserve allowances; 

21 ‘‘(B) requiring the submission of appro22 priate amounts of such allowances in conjunc23 tion with the importation into the United States 

24 of a primary product produced or manufactured 

25 by that sector; 


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1 ‘‘(C) exempting from the requirements of 

2 subparagraph (B) primary products produced 

3 in— 

4 ‘‘(i) a foreign country that the United 

5 Nations has identified as among the least 

6 developed of developing countries; or 

7 ‘‘(ii) a foreign country that the Presi8 dent has determined to be responsible for 

9 less than 0.5 percent of total global green10 house gas emissions; and 

11 ‘‘(D) prohibiting the introduction into 

12 interstate commerce of a primary product with13 out submitting the required number of inter14 national reserve allowances in accordance with 

15 such regulations, unless the product was pro16 duced by a covered entity under this title, or by 

17 an entity that is øor could be¿ regulated under 

18 this title. 

19 ‘‘(2) PURPOSE OF PROGRAM.—The Adminis20 trator shall establish the program under paragraph 

21 (1) in a manner that addresses, consistent with 

22 international agreements to which the United States 

23 is a party, the competitive imbalance in the costs of 

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•HR 2998 IH

1 dustrial sectors resulting from the difference be2 tween— 

3 ‘‘(A) the direct and indirect costs of com4 plying with this title; and 

5 ‘‘(B) the direct and indirect costs, if any, 

6 of complying in other countries with greenhouse 

7 gas regulatory programs, requirements, or ex8 port tariffs, or other measures adopted or im9 posed that are related to the reduction of green10 house gas emissions. 

11 ‘‘(3) EMISSION ALLOWANCE REBATES.—The 

12 Administrator shall take into account the value of 

13 emission allowance rebates distributed under subpart 

14 1 when making calculations under paragraph (2). 

15 ‘‘(4) LIMITATION.—The International Reserve 

16 Allowance Program may not begin before January 1, 

17 2025. 

18 ‘‘(b) COVERED ENTITIES.—International reserve al19 lowances may not be held by covered entities to comply 

20 with section 722. 

21 ‘‘Subpart 3—Presidential Determination 

22 ‘‘SEC. 767. PRESIDENTIAL REPORTS AND DETERMINA23 TIONS. 

24 ‘‘(a) REPORT.—Not later than January 1, 2018, the 

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1 tiveness of the distribution of emission allowance rebates 

2 under subpart 1 in mitigating carbon leakage in industrial 

3 sectors. Such report shall also include— 

4 ‘‘(1) recommendations on how to better achieve 

5 the purposes of this part, including an assessment of 

6 the feasibility and usefulness of an International Re7 serve Allowance Program; and 

8 ‘‘(2) an assessment of the amount and duration 

9 of assistance, including distribution of free allow10 ances, being provided to eligible industrial sectors in 

11 other developed countries to mitigate costs of com12 pliance with domestic greenhouse gas reduction pro13 grams in such countries. 

14 ‘‘(b) PRESIDENTIAL DETERMINATION.—Not later 

15 than June 30, 2022, and every four years thereafter, the 

16 President, in consultation with the Administrator and 

17 other appropriate agencies, shall determine, for each eligi18 ble industrial sector, whether more than 70 percent of 

19 global output for that sector is produced or manufactured 

20 in countries that have met at least one of the following 

21 criteria: 

22 ‘‘(1) The country is a party to an international 

23 agreement to which the United States is a party 

24 that includes a nationally enforceable greenhouse gas 

25 emissions reduction commitment for that country 


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1 that is at least as stringent as that of the United 

2 States. 

3 ‘‘(2) The country is a party to a multilateral or 

4 bilateral emission reduction agreement for that sec5 tor to which the United States is a party. 

6 ‘‘(3) The country has an annual energy or 

7 greenhouse gas intensity, as described in section 

8 764(b)(2)(A)(i), for the sector that is equal to or 

9 less than the energy or greenhouse gas intensity for 

10 such sector in the United States in the most recent 

11 calendar year for which data are available. 

12 ‘‘(4) The country has implemented policies, in13 cluding sectoral caps, export tariffs, production fees, 

14 electricity generation regulations, or greenhouse gas 

15 emissions fees, that individually or collectively im16 pose an incremental increase on the cost of produc17 tion associated with greenhouse gas emissions from 

18 the sector that is at least 60 percent of the cost of 

19 complying with this title in the United States for 

20 such sector, averaged over a two-year period. 

21 ‘‘(c) EFFECT OF PRESIDENTIAL DETERMINATION.— 

22 If the President makes a determination under subsection 

23 (b) with respect to an eligible industrial sector that 70 

24 percent or less of the global output for the sector is pro25 duced or manufactured in countries that have met one or 


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•HR 2998 IH

1 more of the criteria in subsection (b), then the President 

2 shall, not later than June 30, 2022, and every four years 

3 thereafter— 

4 ‘‘(1) assess the extent to which the emission al5 lowance rebates provided pursuant to subpart 1 have 

6 mitigated or addressed, or could mitigate or address, 

7 carbon leakage in that sector; 

8 ‘‘(2) assess the extent to which an International 

9 Reserve Allowance Program has mitigated or ad10 dressed, or could mitigate or address, carbon leakage 

11 in that sector and the feasibility of establishing such 

12 a program; and 

13 ‘‘(3) with respect to that sector— 

14 ‘‘(A) modify the percentage by which direct 

15 and indirect carbon factors will be multiplied 

16 under section 765(a)(1)(B); 

17 ‘‘(B) implement an International Reserve 

18 Allowance Program under section 766 for the 

19 products of the sector; or 

20 ‘‘(C) take the actions in both subparagraph 

21 (A) and (B). 

22 ‘‘(d) REPORT TO CONGRESS.—Not later than June 

23 30, 2022, and every four years thereafter, the President 

24 shall transmit to the Congress a report providing notice 

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1 ing the reasons for such determination, and identifying the 

2 actions taken by the President under subsection (c). 

3 ‘‘(e) LIMITATION.—The President may only imple4 ment an International Reserve Allowance Program for sec5 tors producing primary products. 

6 ‘‘(f) IRON AND STEEL SECTOR.—For the purposes 

7 of this subpart, the Administrator shall consider to be in 

8 the same industrial sector— 

9 ‘‘(1) entities using integrated iron and 

10 steelmaking technologies (including coke ovens, blast 

11 furnaces, and other iron-making technologies); and 

12 ‘‘(2) entities using electric arc furnace tech13 nologies.’’. 

14 Subtitle B—Green Jobs and 

15 Worker Transition 

16 PART 1—GREEN JOBS 

17 SEC. 421. CLEAN ENERGY CURRICULUM DEVELOPMENT 

18 GRANTS. 

19 (a) AUTHORIZATION.—The Secretary of Education is 

20 authorized to award grants, on a competitive basis, to eli21 gible partnerships to develop programs of study (con22 taining the information described in section 122(c)(1)(A) 

23 of the Carl D. Perkins Career and Technical Education 

24 Act of 2006 (20 U.S.C. 2342)), that are focused on emerg25 ing careers and jobs in the fields of clean energy, renewVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00951 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 able energy, energy efficiency, climate change mitigation, 

2 and climate change adaptation. The Secretary of Edu3 cation shall consult with the Secretary of Labor and the 

4 Secretary of Energy prior to the issuance of a solicitation 

5 for grant applications. 

6 (b) ELIGIBLE PARTNERSHIPS.—For purposes of this 

7 section, an eligible partnership shall include— 

8 (1) at least 1 local educational agency eligible 

9 for funding under section 131 of the Carl D. Per10 kins Career and Technical Education Act of 2006 

11 (20 U.S.C. 2351) or an area career and technical 

12 education school or education service agency de13 scribed in such section; 

14 (2) at least 1 postsecondary institution eligible 

15 for funding under section 132 of such Act (20 

16 U.S.C. 2352); and 

17 (3) representatives of the community including 

18 business, labor organizations, and industry that have 

19 experience in fields as described in subsection (a). 

20 (c) APPLICATION.—An eligible partnership seeking a 

21 grant under this section shall submit an application to the 

22 Secretary at such time and in such manner as the Sec23 retary may require. Applications shall include— 

24 (1) a description of the eligible partners and 

25 partnership, the roles and responsibilities of each 


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1 partner, and a demonstration of each partner’s ca2 pacity to support the program; 

3 (2) a description of the career area or areas 

4 within the fields as described in subsection (a) to be 

5 developed, the reason for the choice, and evidence of 

6 the labor market need to prepare students in that 

7 area; 

8 (3) a description of the new or existing program 

9 of study and both secondary and postsecondary com10 ponents; 

11 (4) a description of the students to be served by 

12 the new program of study; 

13 (5) a description of how the program of study 

14 funded by the grant will be replicable and dissemi15 nated to schools outside of the partnership, including 

16 urban and rural areas; 

17 (6) a description of applied learning that will be 

18 incorporated into the program of study and how it 

19 will incorporate or reinforce academic learning; 

20 (7) a description of how the program of study 

21 will be delivered; 

22 (8) a description of how the program will pro23 vide accessibility to students, especially economically 

24 disadvantaged, low performing, and urban and rural 

25 students; 


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1 (9) a description of how the program will ad2 dress placement of students in nontraditional fields 

3 as described in section 3(20) of the Carl D. Perkins 

4 Career and Technical Education Act of 2006 (20 

5 U.S.C. 2302(20)); and 

6 (10) a description of how the applicant proposes 

7 to consult or has consulted with a labor organiza8 tion, labor management partnership, apprenticeship 

9 program, or joint apprenticeship and training pro10 gram that provides education and training in the 

11 field of study for which the applicant proposes to de12 velop a curriculum. 

13 (d) PRIORITY.—The Secretary shall give priority to 

14 applications that— 

15 (1) use online learning or other innovative 

16 means to deliver the program of study to students, 

17 educators, and instructors outside of the partner18 ship; and 

19 (2) focus on low performing students and spe20 cial populations as defined in section 3(29) of the 

21 Carl D. Perkins Career and Technical Education 

22 Act of 2006 (20 U.S.C. 2302(29)). 

23 (e) PEER REVIEW.—The Secretary shall convene a 

24 peer review process to review applications for grants under 

25 this section and to make recommendations regarding the 


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1 selection of grantees. Members of the peer review com2 mittee shall include— 

3 (1) educators who have experience imple4 menting curricula with comparable purposes; and 

5 (2) business and industry experts in fields as 

6 described in subsection (a). 

7 (f) USES OF FUNDS.—Grants awarded under this 

8 section shall be used for the development, implementation, 

9 and dissemination of programs of study (as described in 

10 section 122(c)(1)(A) of the Carl D. Perkins Career and 

11 Technical Education Act (20 U.S.C. 2342(c)(1)(A))) in 

12 career areas related to clean energy, renewable energy, en13 ergy efficiency, climate change mitigation, and climate 

14 change adaptation. 

15 SEC. 422. INCREASED FUNDING FOR ENERGY WORKER 

16 TRAINING PROGRAM. 

17 Section 171(e)(8) of the Workforce Investment Act 

18 of 1998 (29 U.S.C. 2916(e)(8)) is amended by striking 

19 ‘‘$125,000,000’’ and inserting ‘‘$150,000,000’’. 

20 PART 2—CLIMATE CHANGE WORKER 

21 ADJUSTMENT ASSISTANCE 

22 SEC. 425. PETITIONS, ELIGIBILITY REQUIREMENTS, AND 

23 DETERMINATIONS. 

24 (a) PETITIONS.— 


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1 (1) FILING.—A petition for certification of eli2 gibility to apply for adjustment assistance for a 

3 group of workers under this part may be filed by 

4 any of the following: 

5 (A) The group of workers. 

6 (B) The certified or recognized union or 

7 other duly authorized representative of such 

8 workers. 

9 (C) Employers of such workers, one-stop 

10 operators or one-stop partners (as defined in 

11 section 101 of the Workforce Investment Act of 

12 1998 (29 U.S.C. 2801)), including State em13 ployment security agencies, or the State dis14 located worker unit established under title I of 

15 such Act, on behalf of such workers. 

16 The petition shall be filed simultaneously with the 

17 Secretary of Labor and with the Governor of the 

18 State in which such workers’ employment site is lo19 cated. 

20 (2) ACTION BY GOVERNORS.—Upon receipt of a 

21 petition filed under paragraph (1), the Governor 

22 shall— 

23 (A) ensure that rapid response activities 

24 and appropriate core and intensive services (as 

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1 vestment Act of 1998 (29 U.S.C. 2864)) au2 thorized under other Federal laws are made 

3 available to the workers covered by the petition 

4 to the extent authorized under such laws; and 

5 (B) assist the Secretary in the review of 

6 the petition by verifying such information and 

7 providing such other assistance as the Secretary 

8 may request. 

9 (3) ACTION BY THE SECRETARY.—Upon receipt 

10 of the petition, the Secretary shall promptly publish 

11 notice in the Federal Register and on the website of 

12 the Department of Labor that the Secretary has re13 ceived the petition and initiated an investigation. 

14 (4) HEARINGS.—If the petitioner, or any other 

15 person found by the Secretary to have a substantial 

16 interest in the proceedings, submits not later than 

17 10 days after the date of the Secretary’s publication 

18 under paragraph (3) a request for a hearing, the 

19 Secretary shall provide for a public hearing and af20 ford such interested persons an opportunity to be 

21 present, to produce evidence, and to be heard. 

22 (b) ELIGIBILITY.— 

23 (1) IN GENERAL.—A group of workers shall be 

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1 justment assistance under this part pursuant to a 

2 petition filed under subsection (a) if— 

3 (A) the group of workers is employed in— 

4 (i) energy producing and transforming 

5 industries; 

6 (ii) industries dependent upon energy 

7 industries; 

8 (iii) energy-intensive manufacturing 

9 industries; 

10 (iv) consumer goods manufacturing; 

11 or 

12 (v) other industries whose employment 

13 the Secretary determines has been ad14 versely affected by any requirement of title 

15 VII of the Clean Air Act; 

16 (B) the Secretary determines that a sig17 nificant number or proportion of the workers in 

18 such workers’ employment site have become to19 tally or partially separated, or are threatened to 

20 become totally or partially separated from em21 ployment; and 

22 (C) the sales, production, or delivery of 

23 goods or services have decreased as a result of 

24 any requirement of title VII of the Clean Air 

25 Act, including— 


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1 (i) the shift from reliance upon fossil 

2 fuels to other sources of energy, including 

3 renewable energy, that results in the clos4 ing of a facility or layoff of employees at 

5 a facility that mines, produces, processes, 

6 or utilizes fossil fuels to generate elec7 tricity; 

8 (ii) a substantial increase in the cost 

9 of energy required for a manufacturing fa10 cility to produce items whose prices are 

11 competitive in the marketplace, to the ex12 tent the cost is not offset by allowance al13 location to the facility pursuant to title VII 

14 of the Clean Air Act; or 

15 (iii) other documented occurrences 

16 that the Secretary determines are indica17 tors of an adverse impact on an industry 

18 described in subparagraph (A) as a result 

19 of any requirement of title VII of the 

20 Clean Air Act. 

21 (2) WORKERS IN PUBLIC AGENCIES.—A group 

22 of workers in a public agency shall be certified by 

23 the Secretary as eligible to apply for climate change 

24 adjustment assistance pursuant to a petition filed if 

25 the Secretary determines that a significant number 


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1 or proportion of the workers in the public agency 

2 have become totally or partially separated from em3 ployment, or are threatened to become totally or 

4 partially separated as a result of any requirement of 

5 title VII of the Clean Air Act. 

6 (3) ADVERSELY AFFECTED SERVICE WORK7 ERS.—A group of workers shall be certified as eligi8 ble to apply for climate change adjustment assist9 ance pursuant to a petition filed if the Secretary de10 termines that— 

11 (A) a significant number or proportion of 

12 the service workers at an employment site 

13 where a group of workers has been certified by 

14 the Secretary as eligible to apply for adjustment 

15 assistance under this part pursuant to para16 graph (1) have become totally or partially sepa17 rated from employment, or are threatened to 

18 become totally or partially separated; and 

19 (B) a loss of business in the firm providing 

20 service workers to an employment site is di21 rectly attributable to one or more of the docu22 mented occurrences listed in paragraph (1)(C). 

23 (c) AUTHORITY TO INVESTIGATE AND COLLECT IN24 FORMATION.— 


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1 (1) IN GENERAL.—The Secretary shall, in de2 termining whether to certify a group of workers 

3 under subsection (d), obtain information the Sec4 retary determines to be necessary to make the cer5 tification, through questionnaires and in such other 

6 manner as the Secretary determines appropriate 

7 from— 

8 (A) the workers’ employer; 

9 (B) officials of certified or recognized 

10 unions or other duly authorized representatives 

11 of the group of workers; or 

12 (C) one-stop operators or one-stop partners 

13 (as defined in section 101 of the Workforce In14 vestment Act of 1998 (29 U.S.C. 2801)); or 

15 (2) VERIFICATION OF INFORMATION.—The Sec16 retary shall require an employer, union, or one-stop 

17 operator or partner to certify all information ob18 tained under paragraph (1) from the employer, 

19 union, or one-stop operator or partner (as the case 

20 may be) on which the Secretary relies in making a 

21 determination under subsection (d), unless the Sec22 retary has a reasonable basis for determining that 

23 such information is accurate and complete without 

24 being certified. 


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1 (3) PROTECTION OF CONFIDENTIAL INFORMA2 TION.—The Secretary may not release information 

3 obtained under paragraph (1) that the Secretary 

4 considers to be confidential business information un5 less the employer submitting the confidential busi6 ness information had notice, at the time of submis7 sion, that the information would be released by the 

8 Secretary, or the employer subsequently consents to 

9 the release of the information. Nothing in this para10 graph shall be construed to prohibit the Secretary 

11 from providing such confidential business informa12 tion to a court in camera or to another party under 

13 a protective order issued by a court. 

14 (d) DETERMINATION BY THE SECRETARY OF

15 LABOR.— 

16 (1) IN GENERAL.—As soon as possible after the 

17 date on which a petition is filed under subsection 

18 (a), but in any event not later than 40 days after 

19 that date, the Secretary, in consultation with the 

20 Secretary of Energy and the Administrator, as nec21 essary, shall determine whether the petitioning 

22 group meets the requirements of subsection (b) and 

23 shall issue a certification of eligibility to apply for 

24 assistance under this part covering workers in any 

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1 cation shall specify the date on which the total or 

2 partial separation began or threatened to begin. 

3 Upon reaching a determination on a petition, the 

4 Secretary shall promptly publish a summary of the 

5 determination in the Federal Register and on the 

6 website of the Department of Labor, together with 

7 the Secretary’s reasons for making such determina8 tion. 

9 (2) ONE YEAR LIMITATION.—A certification 

10 under this section shall not apply to any worker 

11 whose last total or partial separation from the em12 ployment site before the worker’s application under 

13 section 426(a) occurred more than 1 year before the 

14 date of the petition on which such certification was 

15 granted. 

16 (3) REVOCATION OF CERTIFICATION.—When17 ever the Secretary determines, with respect to any 

18 certification of eligibility of the workers of an em19 ployment site, that total or partial separations from 

20 such site are no longer a result of the factors speci21 fied in subsection (b)(1), the Secretary shall termi22 nate such certification and promptly have notice of 

23 such termination published in the Federal Register 

24 and on the website of the Department of Labor, to25 gether with the Secretary’s reasons for making such 


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1 determination. Such termination shall apply only 

2 with respect to total or partial separations occurring 

3 after the termination date specified by the Secretary. 

4 (e) INDUSTRY NOTIFICATION OF ASSISTANCE.— 

5 Upon receiving a notification of a determination under 

6 subsection (d) with respect to a domestic industry the Sec7 retary of Labor shall notify the representatives of the do8 mestic industry affected by the determination, employers 

9 publicly identified by name during the course of the pro10 ceeding relating to the determination, and any certified 

11 or recognized union or, to the extent practicable, other 

12 duly authorized representative of workers employed by 

13 such representatives of the domestic industry, of— 

14 (1) the adjustment allowances, training, and 

15 other benefits available under this part; 

16 (2) the manner in which to file a petition and 

17 apply for such benefits; and 

18 (3) the availability of assistance in filing such 

19 petitions; 

20 (4) notify the Governor of each State in which 

21 one or more employers in such industry are located 

22 of the Secretary’s determination and the identity of 

23 the employers; and 

24 (5) upon request, provide any assistance that is 

25 necessary to file a petition under subsection (a). 


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1 (f) BENEFIT INFORMATION TO WORKERS, PRO2 VIDERS OF TRAINING.— 

3 (1) IN GENERAL.—The Secretary shall provide 

4 full information to workers about the adjustment al5 lowances, training, and other benefits available 

6 under this part and about the petition and applica7 tion procedures, and the appropriate filing dates, for 

8 such allowances, training and services. The Sec9 retary shall provide whatever assistance is necessary 

10 to enable groups of workers to prepare petitions or 

11 applications for program benefits. The Secretary 

12 shall make every effort to insure that cooperating 

13 State agencies fully comply with the agreements en14 tered into under section 426(a) and shall periodically 

15 review such compliance. The Secretary shall inform 

16 the State Board for Vocational Education or equiva17 lent agency, the one-stop operators or one-stop part18 ners (as defined in section 101 of the Workforce In19 vestment Act of 1998 (29 U.S.C. 2801), and other 

20 public or private agencies, institutions, and employ21 ers, as appropriate, of each certification issued 

22 under subsection (d) and of projections, if available, 

23 of the needs for training under as a result of such 

24 certification. 


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1 (2) NOTICE BY MAIL.—The Secretary shall pro2 vide written notice through the mail of the benefits 

3 available under this part to each worker whom the 

4 Secretary has reason to believe is covered by a cer5 tification made under subsection (d)— 

6 (A) at the time such certification is made, 

7 if the worker was partially or totally separated 

8 from the adversely affected employment before 

9 such certification, or— 

10 (B) at the time of the total or partial sepa11 ration of the worker from the adversely affected 

12 employment, if subparagraph (A) does not 

13 apply. 

14 (3) NEWSPAPERS; WEBSITE.—The Secretary 

15 shall publish notice of the benefits available under 

16 this part to workers covered by each certification 

17 made under subsection (d) in newspapers of general 

18 circulation in the areas in which such workers reside 

19 and shall make such information available on the 

20 website of the Department of Labor. 

21 SEC. 426. PROGRAM BENEFITS. 

22 (a) CLIMATE CHANGE ADJUSTMENT ALLOWANCE.— 

23 (1) ELIGIBILITY.—Payment of a climate change 

24 adjustment allowance shall be made to an adversely 

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1 tion 425(b) who files an application for such allow2 ance for any week of unemployment which begins on 

3 or after the date of such certification, if the fol4 lowing conditions are met: 

5 (A) Such worker’s total or partial separa6 tion before the worker’s application under this 

7 part occurred— 

8 (i) on or after the date, as specified in 

9 the certification under which the worker is 

10 covered, on which total or partial separa11 tion began or threatened to begin in the 

12 adversely affected employment; 

13 (ii) before the expiration of the 2-year 

14 period beginning on the date on which the 

15 determination under section 425(d) was 

16 made; and 

17 (iii) before the termination date, if 

18 any, determined pursuant to section 

19 425(d)(3). 

20 (B) Such worker had, in the 52-week pe21 riod ending with the week in which such total 

22 or partial separation occurred, at least 26 

23 weeks of full-time employment or 1,040 hours 

24 of part time employment in adversely affected 

25 employment, or, if data with respect to weeks of 


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1 employment are not available, equivalent 

2 amounts of employment computed under regu3 lations prescribed by the Secretary. For the 

4 purposes of this paragraph, any week in which 

5 such worker— 

6 (i) is on employer-authorized leave for 

7 purposes of vacation, sickness, injury, ma8 ternity, or inactive duty or active duty 

9 military service for training; 

10 (ii) does not work because of a dis11 ability that is compensable under a work12 men’s compensation law or plan of a State 

13 or the United States; 

14 (iii) had his employment interrupted 

15 in order to serve as a full-time representa16 tive of a labor organization in such firm; or 

17 (iv) is on call-up for purposes of active 

18 duty in a reserve status in the Armed 

19 Forces of the United States, provided such 

20 active duty is ‘‘Federal service’’ as defined 

21 in section 8521(a)(1) of title 5, United 

22 States Code, 

23 shall be treated as a week of employment. 


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1 (C) Such worker is enrolled in a training 

2 program approved by the Secretary under sub3 section (b)(2). 

4 (2) INELIGIBILITY FOR CERTAIN OTHER BENE5 FITS.—An adversely affected worker receiving a pay6 ment under this section shall be ineligible to receive 

7 any other form of unemployment insurance for the 

8 period in which such worker is receiving a climate 

9 change adjustment allowance under this section. 

10 (3) REVOCATION.—If— 

11 (A) the Secretary determines that— 

12 (i) the adversely affected worker— 

13 (I) has failed to begin participa14 tion in the training program the en15 rollment in which meets the require16 ment of paragraph (1)(C); or 

17 (II) has ceased to participate in 

18 such training program before com19 pleting such training program; and 

20 (ii) there is no justifiable cause for 

21 such failure or cessation; or 

22 (B) the certification made with respect to 

23 such worker under section 425(d) is revoked 

24 under paragraph (3) of such section, 


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1 no adjustment allowance may be paid to the ad2 versely affected worker under this part for the week 

3 in which such failure, cessation, or revocation oc4 curred, or any succeeding week, until the adversely 

5 affected worker begins or resumes participation in a 

6 training program approved by the Secretary under 

7 section (b)(2). 

8 (4) WAIVERS OF TRAINING REQUIREMENTS.— 

9 The Secretary may issue a written statement to an 

10 adversely affected worker waiving the requirement to 

11 be enrolled in training described in subsection (b)(2) 

12 if the Secretary determines that it is not feasible or 

13 appropriate for the worker, because of 1 or more of 

14 the following reasons: 

15 (A) RECALL.—The worker has been noti16 fied that the worker will be recalled by the em17 ployer from which the separation occurred. 

18 (B) MARKETABLE SKILLS.— 

19 (i) IN GENERAL.—The worker pos20 sesses marketable skills for suitable em21 ployment (as determined pursuant to an 

22 assessment of the worker, which may in23 clude the profiling system under section 

24 303(j) of the Social Security Act (42 

25 U.S.C. 503(j)), carried out in accordance 


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1 with guidelines issued by the Secretary) 

2 and there is a reasonable expectation of 

3 employment at equivalent wages in the 

4 foreseeable future. 

5 (ii) MARKETABLE SKILLS DEFINED.— 

6 For purposes of clause (i), the term ‘‘mar7 ketable skills’’ may include the possession 

8 of a postgraduate degree from an institu9 tion of higher education (as defined in sec10 tion 102 of the Higher Education Act of 

11 1965 (20 U.S.C. 1002)) or an equivalent 

12 institution, or the possession of an equiva13 lent postgraduate certification in a special14 ized field. 

15 (C) RETIREMENT.—The worker is within 2 

16 years of meeting all requirements for entitle17 ment to either— 

18 (i) old-age insurance benefits under 

19 title II of the Social Security Act (42 

20 U.S.C. 401 et seq.) (except for application 

21 therefor); or 

22 (ii) a private pension sponsored by an 

23 employer or labor organization. 

24 (D) HEALTH.—The worker is unable to 

25 participate in training due to the health of the 


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1 worker, except that a waiver under this sub2 paragraph shall not be construed to exempt a 

3 worker from requirements relating to the avail4 ability for work, active search for work, or re5 fusal to accept work under Federal or State un6 employment compensation laws. 

7 (E) ENROLLMENT UNAVAILABLE.—The 

8 first available enrollment date for the training 

9 of the worker is within 60 days after the date 

10 of the determination made under this para11 graph, or, if later, there are extenuating cir12 cumstances for the delay in enrollment, as de13 termined pursuant to guidelines issued by the 

14 Secretary. 

15 (F) TRAINING NOT AVAILABLE.—Training 

16 described in subsection (b)(2) is not reasonably 

17 available to the worker from either govern18 mental agencies or private sources (which may 

19 include area career and technical education 

20 schools, as defined in section 3 of the Carl D. 

21 Perkins Career and Technical Education Act of 

22 2006 (20 U.S.C. 2302), and employers), no 

23 training that is suitable for the worker is avail24 able at a reasonable cost, or no training funds 

25 are available. 


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1 (5) WEEKLY AMOUNTS.—The climate change 

2 adjustment allowance payable to an adversely af3 fected worker for a week of unemployment shall be 

4 an amount equal to 70 percent of the average weekly 

5 wage of such worker, but in no case shall such 

6 amount exceed the average weekly wage for all work7 ers in the State where the adversely affected worker 

8 resides. 

9 (6) MAXIMUM DURATION OF BENEFITS.—An el10 igible worker may receive a climate change adjust11 ment allowance under this subsection for a period of 

12 not longer than 156 weeks. 

13 (b) EMPLOYMENT SERVICES AND TRAINING.— 

14 (1) INFORMATION AND EMPLOYMENT SERV15 ICES.—The Secretary shall make available, directly 

16 or through agreements with the States under section 

17 427(a) to adversely affected workers covered by a 

18 certification under section 425(a) the following in19 formation and employment services: 

20 (A) Comprehensive and specialized assess21 ment of skill levels and service needs, including 

22 through— 

23 (i) diagnostic testing and use of other 

24 assessment tools; and 


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1 (ii) in-depth interviewing and evalua2 tion to identify employment barriers and 

3 appropriate employment goals. 

4 (B) Development of an individual employ5 ment plan to identify employment goals and ob6 jectives, and appropriate training to achieve 

7 those goals and objectives. 

8 (C) Information on training available in 

9 local and regional areas, information on indi10 vidual counseling to determine which training is 

11 suitable training, and information on how to 

12 apply for such training. 

13 (D) Information on training programs and 

14 other services provided by a State pursuant to 

15 title I of the Workforce Investment Act of 1998 

16 and available in local and regional areas, infor17 mation on individual counseling to determine 

18 which training is suitable training, and informa19 tion on how to apply for such training. 

20 (E) Information on how to apply for finan21 cial aid, including referring workers to edu22 cational opportunity centers described in section 

23 402F of the Higher Education Act of 1965 (20 

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1 nancial aid administrators at institutions of 

2 higher education (as defined in section 102 of 

3 such Act (20 U.S.C. 1002)) to use the adminis4 trators’ discretion under section 479A of such 

5 Act (20 U.S.C. 1087tt) to use current year in6 come data, rather than preceding year income 

7 data, for determining the amount of need of the 

8 workers for Federal financial assistance under 

9 title IV of such Act (20 U.S.C. 1070 et seq.). 

10 (F) Short-term prevocational services, in11 cluding development of learning skills, commu12 nications skills, interviewing skills, punctuality, 

13 personal maintenance skills, and professional 

14 conduct to prepare individuals for employment 

15 or training. 

16 (G) Individual career counseling, including 

17 job search and placement counseling, during the 

18 period in which the individual is receiving a cli19 mate change adjustment allowance or training 

20 under this part, and after receiving such train21 ing for purposes of job placement. 

22 (H) Provision of employment statistics in23 formation, including the provision of accurate 

24 information relating to local, regional, and na25 tional labor market areas, including— 


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1 (i) job vacancy listings in such labor 

2 market areas; 

3 (ii) information on jobs skills nec4 essary to obtain jobs identified in job va5 cancy listings described in subparagraph 

6 (A); 

7 (iii) information relating to local occu8 pations that are in demand and earnings 

9 potential of such occupations; and 

10 (iv) skills requirements for local occu11 pations described in subparagraph (C). 

12 (I) Information relating to the availability 

13 of supportive services, including services relat14 ing to child care, transportation, dependent 

15 care, housing assistance, and need-related pay16 ments that are necessary to enable an indi17 vidual to participate in training. 

18 (2) TRAINING.— 

19 (A) APPROVAL OF AND PAYMENT FOR

20 TRAINING.—If the Secretary determines, with 

21 respect to an adversely affected worker that— 

22 (i) there is no suitable employment 

23 (which may include technical and profes24 sional employment) available for an ad25 versely affected worker; 


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1 (ii) the worker would benefit from ap2 propriate training; 

3 (iii) there is a reasonable expectation 

4 of employment following completion of 

5 such training; 

6 (iv) training approved by the Sec7 retary is reasonably available to the worker 

8 from either governmental agencies or pri9 vate sources (including area career and 

10 technical education schools, as defined in 

11 section 3 of the Carl D. Perkins Career 

12 and Technical Education Act of 2006, and 

13 employers); 

14 (v) the worker is qualified to under15 take and complete such training; and 

16 (vi) such training is suitable for the 

17 worker and available at a reasonable cost, 

18 the Secretary shall approve such training for 

19 the worker. Upon such approval, the worker 

20 shall be entitled to have payment of the costs 

21 of such training (subject to the limitations im22 posed by this section) paid on the worker’s be23 half by the Secretary directly or through a 

24 voucher system. 


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1 (B) DISTRIBUTION.—The Secretary shall 

2 establish procedures for the distribution of the 

3 funds to States to carry out the training pro4 grams approved under this paragraph, and shall 

5 make an initial distribution of the funds made 

6 available as soon as practicable after the begin7 ning of each fiscal year. 

8 (C) ADDITIONAL RULES REGARDING AP9 PROVAL OF AND PAYMENT FOR TRAINING.— 

10 (i) For purposes of applying subpara11 graph (A)(iii), a reasonable expectation of 

12 employment does not require that employ13 ment opportunities for a worker be avail14 able, or offered, immediately upon the 

15 completion of training approved under 

16 such subparagraph. 

17 (ii) If the costs of training an ad18 versely affected worker are paid by the 

19 Secretary under subparagraph (A), no 

20 other payment for such costs may be made 

21 under any other provision of Federal law. 

22 No payment may be made under subpara23 graph (A) of the costs of training an ad24 versely affected worker or an adversely af25 fected incumbent worker if such costs— 


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1 (I) have already been paid under 

2 any other provision of Federal law; or 

3 (II) are reimbursable under any 

4 other provision of Federal law and a 

5 portion of such costs have already 

6 been paid under such other provision 

7 of Federal law. 

8 The provisions of this clause shall not 

9 apply to, or take into account, any funds 

10 provided under any other provision of Fed11 eral law which are used for any purpose 

12 other than the direct payment of the costs 

13 incurred in training a particular adversely 

14 affected worker, even if such use has the 

15 effect of indirectly paying or reducing any 

16 portion of the costs involved in training the 

17 adversely affected worker. 

18 (D) TRAINING PROGRAMS.—The training 

19 programs that may be approved under subpara20 graph (A) include— 

21 (i) employer-based training, includ22 ing— 

23 (I) on-the-job training if ap24 proved by the Secretary under sub25 section (c); and 


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1 (II) joint labor-management ap2 prenticeship programs; 

3 (ii) any training program provided by 

4 a State pursuant to title I of the Work5 force Investment Act of 1998; 

6 (iii) any training program approved 

7 by a private industry council established 

8 under section 102 of such Act; 

9 (iv) any programs in career and tech10 nical education described in section 3(5) of 

11 the Carl D. Perkins Career and Technical 

12 Education Act of 2006; 

13 (v) any program of remedial edu14 cation; 

15 (vi) any program of prerequisite edu16 cation or coursework required to enroll in 

17 training that may be approved under this 

18 paragraph; 

19 (vii) any training program for which 

20 all, or any portion, of the costs of training 

21 the worker are paid— 

22 (I) under any Federal or State 

23 program other than this part; or 

24 (II) from any source other than 

25 this part; 


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1 (viii) any training program or 

2 coursework at an accredited institution of 

3 higher education (described in section 102 

4 of the Higher Education Act of 1965 (20 

5 U.S.C. 1002)), including a training pro6 gram or coursework for the purpose of— 

7 (I) obtaining a degree or certifi8 cation; or 

9 (II) completing a degree or cer10 tification that the worker had pre11 viously begun at an accredited institu12 tion of higher education; and 

13 (ix) any other training program ap14 proved by the Secretary. 

15 (3) SUPPLEMENTAL ASSISTANCE.—The Secretary 

16 may, as appropriate, authorize supplemental assistance 

17 that is necessary to defray reasonable transportation and 

18 subsistence expenses for separate maintenance in a case 

19 in which training for a worker is provided in a facility that 

20 is not within commuting distance of the regular place of 

21 residence of the worker. 

22 (c) ON-THE-JOB TRAINING REQUIREMENTS.— 

23 (1) IN GENERAL.—The Secretary may approve 

24 on-the-job training for any adversely affected worker 

25 if— 


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1 (A) the Secretary determines that on-the2 job training— 

3 (i) can reasonably be expected to lead 

4 to suitable employment with the employer 

5 offering the on-the-job training; 

6 (ii) is compatible with the skills of the 

7 worker; 

8 (iii) includes a curriculum through 

9 which the worker will gain the knowledge 

10 or skills to become proficient in the job for 

11 which the worker is being trained; and 

12 (iv) can be measured by benchmarks 

13 that indicate that the worker is gaining 

14 such knowledge or skills; and 

15 (B) the State determines that the on-the16 job training program meets the requirements of 

17 clauses (iii) and (iv) of subparagraph (A). 

18 (2) MONTHLY PAYMENTS.—The Secretary shall 

19 pay the costs of on-the-job training approved under 

20 paragraph (1) in monthly installments. 

21 (3) CONTRACTS FOR ON-THE-JOB TRAINING.— 

22 (A) IN GENERAL.—The Secretary shall en23 sure, in entering into a contract with an em24 ployer to provide on-the-job training to a work25 er under this subsection, that the skill requireVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 00982 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ments of the job for which the worker is being 

2 trained, the academic and occupational skill 

3 level of the worker, and the work experience of 

4 the worker are taken into consideration. 

5 (B) TERM OF CONTRACT.—Training under 

6 any such contract shall be limited to the period 

7 of time required for the worker receiving on8 the-job training to become proficient in the job 

9 for which the worker is being trained, but may 

10 not exceed 156 weeks in any case. 

11 (4) EXCLUSION OF CERTAIN EMPLOYERS.—The 

12 Secretary shall not enter into a contract for on-the13 job training with an employer that exhibits a pattern 

14 of failing to provide workers receiving on-the-job 

15 training from the employer with— 

16 (A) continued, long-term employment as 

17 regular employees; and 

18 (B) wages, benefits, and working condi19 tions that are equivalent to the wages, benefits, 

20 and working conditions provided to regular em21 ployees who have worked a similar period of 

22 time and are doing the same type of work as 

23 workers receiving on-the-job training from the 

24 employer. 


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1 (d) ADMINISTRATIVE AND EMPLOYMENT SERVICES

2 FUNDING.— 

3 (1) ADMINISTRATIVE FUNDING.—In addition to 

4 any funds made available to a State to carry out this 

5 section for a fiscal year, the State shall receive for 

6 the fiscal year a payment in an amount that is equal 

7 to 15 percent of the amount of such funds and 

8 shall— 

(A) use not more than 2 9 ⁄3 of such payment 

10 for the administration of the climate change ad11 justment assistance for workers program under 

12 this part, including for— 

13 (i) processing waivers of training re14 quirements under subsection (a)(4); 

15 (ii) collecting, validating, and report16 ing data required under this part; and 

17 (iii) administering the Climate Change 

18 Adjustment Assistance Allowance pay19 ments; and 

(B) use not less than 1 20 ⁄3 of such payment 

21 for information and employment services under 

22 subsection (b)(1). 

23 (2) EMPLOYMENT SERVICES FUNDING.— 

24 (A) IN GENERAL.—In addition to any 

25 funds made available to a State to carry out 


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1 subsection (b)(2) and the payment under para2 graph (1) for a fiscal year, the Secretary shall 

3 provide to the State for the fiscal year a reason4 able payment for the purpose of providing em5 ployment and services under subsection (b)(1). 

6 (B) VOLUNTARY RETURN OF FUNDS.—A 

7 State that receives a payment under subpara8 graph (A) may decline or otherwise return such 

9 payment to the Secretary. 

10 (e) JOB SEARCH ALLOWANCES.—The Secretary of 

11 Labor may provide adversely affected workers a one-time 

12 job search allowance in accordance with regulations pre13 scribed by the Secretary. Any job search allowance pro14 vided shall be available only under the following cir15 cumstances and conditions: 

16 (1) The worker is no longer eligible for the cli17 mate change adjustment allowance under subsection 

18 (a) and has completed the training program required 

19 by subsection (a)(1)(E). 

20 (2) The Secretary determines that the worker 

21 cannot reasonably be expected to secure suitable em22 ployment in the commuting area in which the worker 

23 resides. 

24 (3) An allowance granted shall provide reim25 bursement to the worker of all necessary job search 


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1 expenses as prescribed by the Secretary in regula2 tions. Such reimbursement under this subsection 

3 may not exceed $1,500 for any worker. 

4 (f) RELOCATION ALLOWANCE AUTHORIZED.— 

5 (1) IN GENERAL.—Any adversely affected work6 er covered by a certification issued under section 

7 425 may file an application for a relocation allow8 ance with the Secretary, and the Secretary may 

9 grant the relocation allowance, subject to the terms 

10 and conditions of this subsection. 

11 (2) CONDITIONS FOR GRANTING ALLOWANCE.— 

12 A relocation allowance may be granted if all of the 

13 following terms and conditions are met: 

14 (A) ASSIST AN ADVERSELY AFFECTED

15 WORKER.—The relocation allowance will assist 

16 an adversely affected worker in relocating with17 in the United States. 

18 (B) LOCAL EMPLOYMENT NOT AVAIL19 ABLE.—The Secretary determines that the 

20 worker cannot reasonably be expected to secure 

21 suitable employment in the commuting area in 

22 which the worker resides. 

23 (C) TOTAL SEPARATION.—The worker is 

24 totally separated from employment at the time 

25 relocation commences. 


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1 (D) SUITABLE EMPLOYMENT OBTAINED.— 

2 The worker— 

3 (i) has obtained suitable employment 

4 affording a reasonable expectation of long5 term duration in the area in which the 

6 worker wishes to relocate; or 

7 (ii) has obtained a bona fide offer of 

8 such employment. 

9 (E) APPLICATION.—The worker filed an 

10 application with the Secretary at such time and 

11 in such manner as the Secretary shall specify 

12 by regulation. 

13 (3) AMOUNT OF ALLOWANCE.—The relocation 

14 allowance granted to a worker under paragraph (1) 

15 includes— 

16 (A) all reasonable and necessary expenses 

17 (including, subsistence and transportation ex18 penses at levels not exceeding amounts pre19 scribed by the Secretary in regulations) in20 curred in transporting the worker, the worker’s 

21 family, and household effects; and 

22 (B) a lump sum equivalent to 3 times the 

23 worker’s average weekly wage, up to a max24 imum payment of $1,500. 


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1 (4) LIMITATIONS.—A relocation allowance may 

2 not be granted to a worker unless— 

3 (A) the relocation occurs within 182 days 

4 after the filing of the application for relocation 

5 assistance; or 

6 (B) the relocation occurs within 182 days 

7 after the conclusion of training, if the worker 

8 entered a training program approved by the 

9 Secretary under subsection (b)(2). 

10 (g) HEALTH INSURANCE CONTINUATION.—Not later 

11 than 1 year after the date of enactment of this part, the 

12 Secretary of Labor shall prescribe regulations to provide, 

13 for the period in which an adversely affected worker is 

14 participating in a training program described in sub15 section (b)(2), 80 percent of the monthly premium of any 

16 health insurance coverage that an adversely affected work17 er was receiving from such worker’s employer prior to the 

18 separation from employment described in section 425(b), 

19 to be paid to any health care insurance plan designated 

20 by the adversely affected worker receiving an allowance 

21 under this section. 

22 SEC. 427. GENERAL PROVISIONS. 

23 (a) AGREEMENTS WITH STATES.— 

24 (1) IN GENERAL.—The Secretary is authorized 

25 on behalf of the United States to enter into an 


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1 agreement with any State, or with any State agency 

2 (referred to in this section as ‘‘cooperating States’’ 

3 and ‘‘cooperating States agencies’’ respectively). 

4 Under such an agreement, the cooperating State 

5 agency— 

6 (A) as agent of the United States, shall re7 ceive applications for, and shall provide, pay8 ments on the basis provided in this part; 

9 (B) in accordance with paragraph (6), 

10 shall make available to adversely affected work11 ers covered by a certification under section 

12 425(d) the employment services described in 

13 section 426(b)(1); 

14 (C) shall make any certifications required 

15 under section 425(d); 

16 (D) shall otherwise cooperate with the Sec17 retary and with other State and Federal agen18 cies in providing payments and services under 

19 this part. 

20 Each agreement under this section shall provide the 

21 terms and conditions upon which the agreement may 

22 be amended, suspended, or terminated. 

23 (2) FORM AND MANNER OF DATA.—Each 

24 agreement under this section shall— 


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1 (A) provide the Secretary with the author2 ity to collect any data the Secretary determines 

3 necessary to meet the requirements of this part; 

4 and 

5 (B) specify the form and manner in which 

6 any such data requested by the Secretary shall 

7 be reported. 

8 (3) RELATIONSHIP TO UNEMPLOYMENT INSUR9 ANCE.—Each agreement under this section shall 

10 provide that an adversely affected worker receiving 

11 a climate change adjustment allowance under this 

12 part shall not be eligible for unemployment insur13 ance otherwise payable to such worker under the 

14 laws of the State. 

15 (4) REVIEW.—A determination by a cooper16 ating State agency with respect to entitlement to 

17 program benefits under an agreement is subject to 

18 review in the same manner and to the same extent 

19 as determinations under the applicable State law 

20 and only in that manner and to that extent. 

21 (5) COORDINATION.—Any agreement entered 

22 into under this section shall provide for the coordi23 nation of the administration of the provisions for 

24 employment services, training, and supplemental as25 sistance under section 426 and under title I of the 


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1 Workforce Investment Act of 1998 upon such terms 

2 and conditions as are established by the Secretary in 

3 consultation with the States and set forth in such 

4 agreement. Any agency of the State jointly admin5 istering such provisions under such agreement shall 

6 be considered to be a cooperating State agency for 

7 purposes of this part. 

8 (6) RESPONSIBILITIES OF COOPERATING AGEN9 CIES.—Each cooperating State agency shall, in car10 rying out paragraph (1)(B)— 

11 (A) advise each worker who applies for un12 employment insurance of the benefits under this 

13 part and the procedures and deadlines for ap14 plying for such benefits; 

15 (B) facilitate the early filing of petitions 

16 under section 425(a) for any workers that the 

17 agency considers are likely to be eligible for 

18 benefits under this part; 

19 (C) advise each adversely affected worker 

20 to apply for training under section 426(b) be21 fore, or at the same time, the worker applies for 

22 climate change adjustment allowances under 

23 section 426(a); 

24 (D) perform outreach to, intake of, and 

25 orientation for adversely affected workers and 


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1 adversely affected incumbent workers covered 

2 by a certification under section 426(a) with re3 spect to assistance and benefits available under 

4 this part; 

5 (E) make employment services described in 

6 section 426(b)(1) available to adversely affected 

7 workers and adversely affected incumbent work8 ers covered by a certification under section 

9 425(d) and, if funds provided to carry out this 

10 part are insufficient to make such services 

11 available, make arrangements to make such 

12 services available through other Federal pro13 grams; and 

14 (F) provide the benefits and reemployment 

15 services under this part in a manner that is 

16 necessary for the proper and efficient adminis17 tration of this part, including the use of state 

18 agency personnel employed in accordance with a 

19 merit system of personnel administration stand20 ards, including— 

21 (i) making determinations of eligibility 

22 for, and payment of, climate change read23 justment allowances and health care ben24 efit replacement amounts; 


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1 (ii) developing recommendations re2 garding payments as a bridge to retire3 ment and lump sum payments to pension 

4 plans in accordance with this subsection; 

5 and 

6 (iii) the provision of reemployment 

7 services to eligible workers, including refer8 ral to training services. 

9 (7) In order to promote the coordination of 

10 workforce investment activities in each State with 

11 activities carried out under this part, any agreement 

12 entered into under this section shall provide that the 

13 State shall submit to the Secretary, in such form as 

14 the Secretary may require, the description and infor15 mation described in paragraphs (8) and (14) of sec16 tion 112(b) of the Workforce Investment Act of 

17 1998 (29 U.S.C. 2822(b)) and a description of the 

18 State’s rapid response activities under section 

19 221(a)(2)(A). 

20 (8) CONTROL MEASURES.— 

21 (A) IN GENERAL.—The Secretary shall re22 quire each cooperating State and cooperating 

23 State agency to implement effective control 

24 measures and to effectively oversee the oper25 ation and administration of the climate change 


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1 adjustment assistance program under this part, 

2 including by means of monitoring the operation 

3 of control measures to improve the accuracy 

4 and timeliness of the data being collected and 

5 reported. 

6 (B) DEFINITION.—For purposes of sub7 paragraph (A), the term ‘‘control measures’’ 

8 means measures that— 

9 (i) are internal to a system used by a 

10 State to collect data; and 

11 (ii) are designed to ensure the accu12 racy and verifiability of such data. 

13 (9) DATA REPORTING.— 

14 (A) IN GENERAL.—Any agreement entered 

15 into under this section shall require the cooper16 ating State or cooperating State agency to re17 port to the Secretary on a quarterly basis com18 prehensive performance accountability data, to 

19 consist of— 

20 (i) the core indicators of performance 

21 described in subparagraph (B)(i); 

22 (ii) the additional indicators of per23 formance described in subparagraph 

24 (B)(ii), if any; and 


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1 (iii) a description of efforts made to 

2 improve outcomes for workers under the 

3 climate change adjustment assistance pro4 gram. 

5 (B) CORE INDICATORS DESCRIBED.— 

6 (i) IN GENERAL.—The core indicators 

7 of performance described in this subpara8 graph are— 

9 (I) the percentage of workers re10 ceiving benefits under this part who 

11 are employed during the second cal12 endar quarter following the calendar 

13 quarter in which the workers cease re14 ceiving such benefits; 

15 (II) the percentage of such work16 ers who are employed in each of the 

17 third and fourth calendar quarters fol18 lowing the calendar quarter in which 

19 the workers cease receiving such bene20 fits; and 

21 (III) the earnings of such work22 ers in each of the third and fourth 

23 calendar quarters following the cal24 endar quarter in which the workers 

25 cease receiving such benefits. 


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1 (ii) ADDITIONAL INDICATORS.—The 

2 Secretary and a cooperating State or co3 operating State agency may agree upon 

4 additional indicators of performance for 

5 the climate change adjustment assistance 

6 program under this part, as appropriate. 

7 (C) STANDARDS WITH RESPECT TO RELI8 ABILITY OF DATA.—In preparing the quarterly 

9 report required by subparagraph (A), each co10 operating State or cooperating State agency 

11 shall establish procedures that are consistent 

12 with guidelines to be issued by the Secretary to 

13 ensure that the data reported are valid and reli14 able. 

15 (10) VERIFICATION OF ELIGIBILITY FOR PRO16 GRAM BENEFITS.— 

17 (A) IN GENERAL.—An agreement under 

18 this section shall provide that the State shall 

19 periodically redetermine that a worker receiving 

20 benefits under this part who is not a citizen or 

21 national of the United States remains in a sat22 isfactory immigration status. Once satisfactory 

23 immigration status has been initially verified 

24 through the immigration status verification sys25 tem described in section 1137(d) of the Social 


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1 Security Act (42 U.S.C. 1320b-7(d)) for pur2 poses of establishing a worker’s eligibility for 

3 unemployment compensation, the State shall 

4 reverify the worker’s immigration status if the 

5 documentation provided during initial 

6 verification will expire during the period in 

7 which that worker is potentially eligible to re8 ceive benefits under this part. The State shall 

9 conduct such redetermination in a timely man10 ner, utilizing the immigration status verification 

11 system described in section 1137(d) of the So12 cial Security Act (42 U.S.C. 1320b-7(d)). 

13 (B) PROCEDURES.—The Secretary shall 

14 establish procedures to ensure the uniform ap15 plication by the States of the requirements of 

16 this paragraph. 

17 (b) ADMINISTRATION ABSENT STATE AGREE18 MENT.— 

19 (1) In any State where there is no agreement 

20 in force between a State or its agency under sub21 section (a), the Secretary shall promulgate regula22 tions for the performance of all necessary functions 

23 under section 426, including provision for a fair 

24 hearing for any worker whose application for pay25 ments is denied. 


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1 (2) A final determination under paragraph (1) 

2 with respect to entitlement to program benefits 

3 under section 426 is subject to review by the courts 

4 in the same manner and to the same extent as is 

5 provided by section 205(g) of the Social Security Act 

6 (42 U.S.C. 405(g)). 

7 (c) PROHIBITION ON CONTRACTING WITH PRIVATE

8 ENTITIES.—Neither the Secretary nor a State may con9 tract with any private for-profit or nonprofit entity for the 

10 administration of the climate change adjustment assist11 ance program under this part. 

12 (d) PAYMENT TO THE STATES.— 

13 (1) IN GENERAL.—The Secretary shall from 

14 time to time certify to the Secretary of the Treasury 

15 for payment to each cooperating State the sums nec16 essary to enable such State as agent of the United 

17 States to make payments provided for by this part. 

18 (2) RESTRICTION.—All money paid a State 

19 under this subsection shall be used solely for the 

20 purposes for which it is paid; and money so paid 

21 which is not used for such purposes shall be re22 turned, at the time specified in the agreement under 

23 this section, to the Secretary of the Treasury. 

24 (3) BONDS.—Any agreement under this section 

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1 tifying payments or disbursing funds under the 

2 agreement or otherwise participating in the perform3 ance of the agreement, to give a surety bond to the 

4 United States in such amount as the Secretary may 

5 deem necessary, and may provide for the payment of 

6 the cost of such bond from funds for carrying out 

7 the purposes of this part. 

8 (e) LABOR STANDARDS.— 

9 (1) PROHIBITION ON DISPLACEMENT.—An indi10 vidual in an apprenticeship program or on-the-job 

11 training program under this part shall not displace 

12 (including a partial displacement, such as a reduc13 tion in the hours of non-overtime work, wages, or 

14 employment benefits) any employed employee. 

15 (2) PROHIBITION ON IMPAIRMENT OF CON16 TRACTS.—An apprenticeship program or on-the-job 

17 raining program under this Act shall not impair an 

18 existing contract for services or collective bargaining 

19 agreement, and no such activity that would be incon20 sistent with the terms of a collective bargaining 

21 agreement shall be undertaken without the written 

22 concurrence of the labor organization and employer 

23 concerned. 

24 (3) ADDITIONAL STANDARDS.—The Secretary, 

25 or a State acting under an agreement described in 


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1 subsection (a) may pay the costs of on-the-job train2 ing, notwithstanding any other provision of this sec3 tion, only if— 

4 (A) in the case of training which would be 

5 inconsistent with the terms of a collective bar6 gaining agreement, the written concurrence of 

7 the labor organization concerned has been ob8 tained; 

9 (B) the job for which such adversely af10 fected worker is being trained is not being cre11 ated in a promotional line that will infringe in 

12 any way upon the promotional opportunities of 

13 currently employed individuals; 

14 (C) such training is not for the same occu15 pation from which the worker was separated 

16 and with respect to which such worker’s group 

17 was certified pursuant to section 425(d); 

18 (D) the employer is provided reimburse19 ment of not more than 50 percent of the wage 

20 rate of the participant, for the cost of providing 

21 the training and additional supervision related 

22 to the training; and 

23 (E) the employer has not received payment 

24 under with respect to any other on-the-job 

25 training provided by such employer which failed 


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1 to meet the requirements of subparagraphs (A) 

2 through (D). 

3 (f) DEFINITIONS.—As used in this part the following 

4 definitions apply: 

5 (1) The term ‘‘adversely affected employment’’ 

6 means employment at an employment site, if work7 ers at such site are eligible to apply for adjustment 

8 assistance under this part. 

9 (2) The term ‘‘adversely affected worker’’ 

10 means an individual who has been totally or partially 

11 separated from employment and is eligible to apply 

12 for adjustment assistance under this part. 

(3) The term ‘‘average weekly wage’’ means 1 13 ⁄13

14 of the total wages paid to an individual in the quar15 ter in which the individual’s total wages were highest 

16 among the first 4 of the last 5 completed calendar 

17 quarters immediately before the quarter in which oc18 curs the week with respect to which the computation 

19 is made. Such week shall be the week in which total 

20 separation occurred, or, in cases where partial sepa21 ration is claimed, an appropriate week, as defined in 

22 regulations prescribed by the Secretary. 

23 (4) The term ‘‘average weekly hours’’ means 

24 the average hours worked by the individual (exclud25 ing overtime) in the employment from which he has 


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1 been or claims to have been separated in the 52 

2 weeks (excluding weeks during which the individual 

3 was sick or on vacation) preceding the week speci4 fied in the last sentence of paragraph (4). 

5 (5) The term ‘‘benefit period’’ means, with re6 spect to an individual— 

7 (A) the benefit year and any ensuing pe8 riod, as determined under applicable State law, 

9 during which the individual is eligible for reg10 ular compensation, additional compensation, or 

11 extended compensation; or 

12 (B) the equivalent to such a benefit year 

13 or ensuing period provided for under the appli14 cable Federal unemployment insurance law. 

15 (6) The term ‘‘consumer goods manufacturing’’ 

16 means the electrical equipment, appliance, and com17 ponent manufacturing industry and transportation 

18 equipment manufacturing. 

19 (7) The term ‘‘employment site’’ means a single 

20 facility or site of employment. 

21 (8) The term ‘‘energy-intensive manufacturing 

22 industries’’ means all industrial sectors, entities, or 

23 groups of entities that meet the energy or green24 house gas intensity criteria in section 


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1 765(b)(2)(A)(i) of the Clean Air Act based on the 

2 most recent data available. 

3 (9) The term ‘‘energy producing and trans4 forming industries’’ means the coal mining industry, 

5 oil and gas extraction, electricity power generation, 

6 transmission and distribution, and natural gas dis7 tribution. 

8 (10) The term ‘‘industries dependent on energy 

9 industries’’ means rail transportation and pipeline 

10 transportation. 

11 (11) The term ‘‘on-the-job training’’ means 

12 training provided by an employer to an individual 

13 who is employed by the employer. 

14 (12) The terms ‘‘partial separation’’ and ‘‘par15 tially separated’’ refer, with respect to an individual 

16 who has not been totally separated, that such indi17 vidual has had— 

18 (A) his or her hours of work reduced to 80 

19 percent or less of his average weekly hours in 

20 adversely affected employment; and 

21 (B) his or her wages reduced to 80 percent 

22 or less of his average weekly wage in such ad23 versely affected employment. 


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1 (13) The term ‘‘public agency’’ means a depart2 ment or agency of a State or political subdivision of 

3 a State or of the Federal government. 

4 (14) The term ‘‘Secretary’’ means the Secretary 

5 of Labor. 

6 (15) The term ‘‘service workers’’ means work7 ers supplying support or auxiliary services to an em8 ployment site. 

9 (16) The term ‘‘State agency’’ means the agen10 cy of the State which administers the State law. 

11 (17) The term ‘‘State law’’ means the unem12 ployment insurance law of the State approved by the 

13 Secretary of Labor under section 3304 of the Inter14 nal Revenue Code of 1954. 

15 (18) The terms ‘‘total separation’’ and ‘‘totally 

16 separated’’ refer to the layoff or severance of an in17 dividual from employment with an employer in which 

18 adversely affected employment exists. 

19 (19) The term ‘‘unemployment insurance’’ 

20 means the unemployment compensation payable to 

21 an individual under any State law or Federal unem22 ployment compensation law, including chapter 85 of 

23 title 5, United States Code, and the Railroad Unem24 ployment Insurance Act. The terms ‘‘regular com25 pensation’’, ‘‘additional compensation’’, and ‘‘exVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 01004 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tended compensation’’ have the same respective 

2 meanings that are given them in section 205(2), (3), 

3 and (4) of the Federal-State Extended Unemploy4 ment Compensation Act of 1970 (26 U.S.C. 3304 

5 note.) 

6 (20) The term ‘‘week’’ means a week as defined 

7 in the applicable State law. 

8 (21) The term ‘‘week of unemployment’’ means 

9 a week of total, part-total, or partial unemployment 

10 as determined under the applicable State law or 

11 Federal unemployment insurance law. 

12 (g) SPECIAL RULE WITH RESPECT TO MILITARY

13 SERVICE.— 

14 (1) IN GENERAL.—Notwithstanding any other 

15 provision of this part, the Secretary may waive any 

16 requirement of this part that the Secretary deter17 mines is necessary to ensure that an adversely af18 fected worker who is a member of a reserve compo19 nent of the Armed Forces and serves a period of 

20 duty described in paragraph (2) is eligible to receive 

21 a climate change adjustment allowance, training, 

22 and other benefits under this part in the same man23 ner and to the same extent as if the worker had not 

24 served the period of duty. 


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1 (2) PERIOD OF DUTY DESCRIBED.—An ad2 versely affected worker serves a period of duty de3 scribed in this paragraph if, before completing train4 ing under this part, the worker— 

5 (A) serves on active duty for a period of 

6 more than 30 days under a call or order to ac7 tive duty of more than 30 days; or 

8 (B) in the case of a member of the Army 

9 National Guard of the United States or Air Na10 tional Guard of the United States, performs 

11 full-time National Guard duty under section 

12 502(f) of title 32, United States Code, for 30 

13 consecutive days or more when authorized by 

14 the President or the Secretary of Defense for 

15 the purpose of responding to a national emer16 gency declared by the President and supported 

17 by Federal funds. 

18 (h) FRAUD AND RECOVERY OF OVERPAYMENTS.— 

19 (1) RECOVERY OF PAYMENTS TO WHICH AN IN20 DIVIDUAL WAS NOT ENTITLED.—If the Secretary or 

21 a court of competent jurisdiction determines that 

22 any person has received any payment under this 

23 part to which the individual was not entitled, such 

24 individual shall be liable to repay such amount to 

25 the Secretary, as the case may be, except that the 


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1 Secretary shall waive such repayment if such agency 

2 or the Secretary determines that— 

3 (A) the payment was made without fault 

4 on the part of such individual; and 

5 (B) requiring such repayment would cause 

6 a financial hardship for the individual (or the 

7 individual’s household, if applicable) when tak8 ing into consideration the income and resources 

9 reasonably available to the individual (or house10 hold) and other ordinary living expenses of the 

11 individual (or household). 

12 (2) MEANS OF RECOVERY.—Unless an overpay13 ment is otherwise recovered, or waived under para14 graph (1), the Secretary shall recover the overpay15 ment by deductions from any sums payable to such 

16 person under this part, under any Federal unem17 ployment compensation law or other Federal law ad18 ministered by the Secretary which provides for the 

19 payment of assistance or an allowance with respect 

20 to unemployment. Any amount recovered under this 

21 section shall be returned to the Treasury of the 

22 United States. 

23 (3) PENALTIES FOR FRAUD.—Any person 

24 who— 


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1 (A) makes a false statement of a material 

2 fact knowing it to be false, or knowingly fails 

3 to disclose a material fact, for the purpose of 

4 obtaining or increasing for that person or for 

5 any other person any payment authorized to be 

6 furnished under this part; or 

7 (B) makes a false statement of a material 

8 fact knowing it to be false, or knowingly fails 

9 to disclose a material fact, when providing in10 formation to the Secretary during an investiga11 tion of a petition under section 425(c), 

12 shall be imprisoned for not more than one year, or fined 

13 under title 18, United States Code, or both, and be ineli14 gible for any further payments under this part. 

15 (i) REGULATIONS.—The Secretary shall prescribe 

16 such regulations as may be necessary to carry out the pro17 visions of this part. 

18 (j) STUDY ON OLDER WORKERS.—The Secretary 

19 shall conduct a study examine the circumstances of older 

20 adversely affected workers and the ability of such workers 

21 to access their retirement benefits. The Secretary shall 

22 transmit a report to Congress not later than 2 years after 

23 the date of enactment of this part on the findings of the 

24 study and the Secretary’s recommendations on how to enVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 01008 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 sure that adversely affected workers within 2 years of re2 tirement are able to access their retirement benefits. 

3 ø(k) SPENDING LIMIT.—For each fiscal year, the 

4 total amount of funds disbursed for the purposes described 

5 in section 426 shall not exceed the amount deposited in 

6 that fiscal year into the Climate Change Worker Assist7 ance Fund established under section ø782(j)¿ of the Clean 

8 Air Act. The annual spending limit for any succeeding 

9 year shall be increased by the difference, if any, between 

10 the amount of the prior year’s disbursements and the 

11 spending limitation for that year. The Secretary shall pro12 mulgate rules to ensure that this spending limit is not ex13 ceeded. Such rules shall provide that workers who receive 

14 any of the benefits described in section 426 receive full 

15 benefits, and shall include the establishment of a waiting 

16 list for workers in the event that the requests for assist17 ance exceed the spending limit.¿ 

18 Subtitle C—Consumer Assistance 

19 SEC. 431. ENERGY REFUND PROGRAM. 

20 The Social Security Act (42 U.S.C. 201 et seq.) is 

21 amended by adding at the end the following: 


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1 ‘‘TITLE XXII—ENERGY REFUND 

2 PROGRAM 

3 ‘‘SEC. 2201. ENERGY REFUND PROGRAM. 

4 ‘‘(a) IN GENERAL.—The Secretary shall formulate 

5 and administer the program provided for in this section, 

6 which shall be known as the ‘Energy Refund Program’, 

7 and under which eligible low-income households are pro8 vided cash payments to reimburse the households for the 

9 estimated loss in their purchasing power resulting from 

10 the American Clean Energy and Security Act of 2009. 

11 ‘‘(b) ENTITLEMENT OF ELIGIBLE HOUSEHOLDS TO

12 CASH PAYMENTS.—At the request of the State agency of 

13 a State, each eligible low-income household in the State 

14 shall be entitled to receive monthly cash payments under 

15 this section in an amount equal to the monthly energy re16 fund amount determined under subsection (d). 

17 ‘‘(c) ELIGIBILITY.— 

18 ‘‘(1) ELIGIBLE HOUSEHOLDS.—A household 

19 shall be considered to be an eligible low-income 

20 household for purposes of this section if— 

21 ‘‘(A) the gross income of the household 

22 does not exceed the greater of— 

23 ‘‘(i) 150 percent of the poverty line; 

24 or 


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1 ‘‘(ii) the greatest amount of household 

2 gross income in respect of which a benefit 

3 could be payable under subsection 

4 (d)(2)(B); 

5 ‘‘(B) the State agency of the State in 

6 which the household is located determines that 

7 the household is participating in— 

8 ‘‘(i) the Supplemental Nutrition As9 sistance Program authorized by the Food 

10 and Nutrition Act of 2008 (7 U.S.C. 2011 

11 et seq.); 

12 ‘‘(ii) the Food Distribution Program 

13 on Indian Reservations authorized by sec14 tion 4(b) of such Act (7 U.S.C. 2013(b)); 

15 or 

16 ‘‘(iii) the program for nutrition assist17 ance in Puerto Rico or American Samoa 

18 under section 19 of such Act (7 U.S.C. 

19 2028); 

20 ‘‘(C) the household consists of a single in21 dividual or a married couple, and— 

22 ‘‘(i) receives the subsidy described in 

23 section 1860D–14 of this Act (42 U.S.C. 

24 1395w–114); or 


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1 ‘‘(ii)(I) participates in the program 

2 under title XVIII of this Act; and 

3 ‘‘(II) meets the income requirements 

4 described in section 1860D–14(a)(1) or 

5 (a)(2) of this Act (42 U.S.C. 1395w– 

6 114(a)(1) or (a)(2)); or 

7 ‘‘(D) the household consists of a single in8 dividual or a married couple, and receives bene9 fits under the supplemental security income 

10 program under title XVI of this Act (42 U.S.C. 

11 1381–1383f). 

12 ‘‘(2) STREAMLINED PARTICIPATION FOR CER13 TAIN BENEFICIARIES.—The Secretary shall— 

14 ‘‘(A) periodically estimate the number of 

15 eligible beneficiaries and households, and the 

16 number of participating beneficiaries and 

17 households, for the Energy Refund Program; 

18 and 

19 ‘‘(B) develop procedures, in consultation 

20 with the Commissioner of Social Security, the 

21 Railroad Retirement Board, the Secretary of 

22 Veterans Affairs, and the State agencies, to en23 sure that low-income beneficiaries of the benefit 

24 programs administered by such entities receive 


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1 the energy refund for which the beneficiaries 

2 are eligible under the Energy Refund Program. 

3 ‘‘(3) LIMITATION.—Notwithstanding any other 

4 provision of law, the Secretary shall provide refunds 

5 to United States citizens, United States nationals, 

6 and individuals lawfully residing in the United 

7 States who qualify for a refund under paragraph 

8 (1)(A), and shall establish procedures to ensure that 

9 other individuals do not receive refunds. 

10 ‘‘(4) NATIONAL STANDARDS.—The Secretary 

11 shall consult with the Secretary of Agriculture and 

12 establish uniform national standards of eligibility en13 suring that States may seamlessly co-administer the 

14 energy refund program with the Supplemental Nu15 trition Assistance Program in accordance with the 

16 provisions of this section. No State agency shall im17 pose any other standard or requirement as a condi18 tion of eligibility or refund receipt under the pro19 gram. Assistance in the Energy Refund Program 

20 shall be furnished promptly to all eligible households 

21 who make application for such participation or are 

22 already enrolled in any program referred to in para23 graph (1). 

24 ‘‘(d) MONTHLY ENERGY REFUND AMOUNT.— 


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1 ‘‘(1) ESTIMATED ANNUAL TOTAL LOSS IN PUR2 CHASING POWER.—Not later than August 31 of each 

3 fiscal year, the Energy Information Administration 

4 shall estimate the annual total loss in purchasing 

5 power that will result from American Clean Energy 

6 and Security Act of 2009 in the next fiscal year for 

7 households of each size with gross income equal to 

8 150 percent of the poverty line, based on the pro9 jected total market value of all compliance costs (in10 cluding, but not limited to, the emissions allowances 

11 used to demonstrate compliance with title VII of the 

12 Clean Air Act in the next fiscal year, and excluding 

13 costs that are not projected to be incurred by house14 holds as a result of allowances freely allocated and 

15 intended for residential consumer assistance pursu16 ant to sections 783 through 785 of the Clean Air 

17 Act), in a way generally recognized as suitable by 

18 experts. 

19 ‘‘(2) MONTHLY ENERGY REFUND.—The month20 ly energy refund amount for an eligible household 

21 under this section shall be— 

22 ‘‘(A) if the gross income of the household 

23 does not exceed 150 percent of the poverty line 

24 applicable to the household— 


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1 ‘‘(i) if the household has 1, 2, 3, or 4 

members, 1 2 ⁄12 of the amount estimated 

3 under paragraph (1) for a household of the 

4 same size, rounded to the nearest whole 

5 dollar amount; or 

6 ‘‘(ii) if the household has 5 or more 

members, 1 7 ⁄12 of the arithmetic mean value 

8 of the amounts estimated under paragraph 

9 (1) for households with 5 or more mem10 bers, rounded to the nearest whole dollar 

11 amount; or 

12 ‘‘(B) if the gross income of the household 

13 exceeds 150 percent of the poverty line applicable to the household, 1 14 ⁄12 of the amount (if any) 

15 by which— 

16 ‘‘(i) the amount estimated under 

17 paragraph (1) for a household of the same 

18 size; exceeds 

19 ‘‘(ii) 20 percent of the amount by 

20 which the gross income of the household 

21 exceeds 150 percent of the poverty line. 

22 ‘‘(e) DELIVERY MECHANISM.— 

23 ‘‘(1) Subject to standards and an implementa24 tion schedule set by the Secretary, the energy refund 

25 shall be provided in monthly installments via— 


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1 ‘‘(A) direct deposit into the eligible house2 hold’s designated bank account; 

3 ‘‘(B) the State’s electronic benefit transfer 

4 system; or 

5 ‘‘(C) another Federal or State mechanism, 

6 if such a mechanism is approved by the Sec7 retary. 

8 ‘‘(2) Such standards shall include— 

9 ‘‘(A)(i) defining the required level of recipi10 ent protection regarding privacy; 

11 ‘‘(ii) guidance on how recipients are of12 fered choices, when relevant, about the delivery 

13 mechanism; 

14 ‘‘(iii) guidance on ease of use and access to 

15 the refund, including the prohibition of fees 

16 charged to recipients for withdrawals or other 

17 services; and 

18 ‘‘(iv) cost-effective protections against im19 proper accessing of the energy refund; 

20 ‘‘(B) operating standards that provide for 

21 interoperability between States and law enforce22 ment monitoring; and 

23 ‘‘(C) other standards, as determined by the 

24 Secretary or the Secretary’s designee. 

25 ‘‘(f) ADMINISTRATION.— 


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1 ‘‘(1) IN GENERAL.—The State agency of each 

2 participating State shall assume responsibility for 

3 the certification of applicant households and for the 

4 issuance of refunds and the control and account5 ability thereof. 

6 ‘‘(2) PROCEDURES.—Under standards estab7 lished by the Secretary, the State agency shall estab8 lish procedures governing the administration of the 

9 Energy Refund Program that the State agency de10 termines best serve households in the State, includ11 ing households with special needs, such as house12 holds with elderly or disabled members, households 

13 in rural areas, homeless individuals, and households 

14 residing on reservations as defined in the Indian 

15 Child Welfare Act of 1978 and the Indian Financing 

16 Act of 1974. In carrying out this paragraph, a State 

17 agency— 

18 ‘‘(A) shall provide timely, accurate, and 

19 fair service to applicants for, and participants 

20 in, the Energy Refund Program; 

21 ‘‘(B) shall permit an applicant household 

22 to apply to participate in the program at the 

23 time that the household first contacts the State 

24 agency, and shall consider an application that 

25 contains the name, address, and signature of 


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1 the applicant to be sufficient to constitute an 

2 application for participation; 

3 ‘‘(C) shall screen any applicant household 

4 for the Supplemental Nutrition Assistance Pro5 gram, the State’s medical assistance program 

6 under section XIX of this Act, State Childrens 

7 Health Insurance Program under section XXI 

8 of this Act, and a State program that provides 

9 basic assistance under a State program funded 

10 under title IV of this Act or with qualified 

11 State expenditures as defined in section 

12 409(a)(7) of this Act for eligibility for the En13 ergy Refund Program and, if eligible, shall en14 roll such applicant household in the Energy Re15 fund Program; 

16 ‘‘(D) shall complete certification of and 

17 provide a refund to any eligible household not 

18 later than 30 days following its filing of an ap19 plication; 

20 ‘‘(E) shall use appropriate bilingual per21 sonnel and materials in the administration of 

22 the program in those portions of the State in 

23 which a substantial number of members of low24 income households speak a language other than 

25 English; and 


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1 ‘‘(F) shall utilize State agency personnel 

2 who are employed in accordance with the cur3 rent standards for a Merit System of Personnel 

4 Administration or any standards later pre5 scribed by the Office of Personnel Management 

6 pursuant to section 208 of the Intergovern7 mental Personnel Act of 1970 (42 U.S.C. 4728) 

8 modifying or superseding such standards relat9 ing to the establishment and maintenance of 

10 personnel standards on a merit basis to make 

11 all tentative and final determinations of eligi12 bility and ineligibility. 

13 ‘‘(3) REGULATIONS.— 

14 ‘‘(A) Except as provided in subparagraph 

15 (B), the Secretary shall issue such regulations 

16 consistent with this section as the Secretary 

17 deems necessary or appropriate for the effective 

18 and efficient administration of the Energy Re19 fund Program, and shall promulgate all such 

20 regulations in accordance with the procedures 

21 set forth in section 553 of title 5, United States 

22 Code. 

23 ‘‘(B) Without regard to section 553 of title 

24 5 of such Code, the Secretary may, during the 

25 period beginning with the effective date of this 


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1 section and ending 2 years after such date, by 

2 rule promulgate as final any procedures that 

3 are substantially the same as the procedures 

4 governing the Supplemental Nutrition Assist5 ance Program in section 273.2, 273.12, or 

6 273.15 of title 7, Code of Federal Regulations. 

7 ‘‘(C) Notwithstanding subsection (i)(4), 

8 the Secretary may promulgate regulations al9 lowing for streamlined eligibility determinations 

10 for some or all households which include indi11 viduals receiving assistance under a State plan 

12 approved under title XIX or XXI of this Act. 

13 The regulations may institute procedures 

14 whereby the income and family size information 

15 used for determining eligibility under such title 

16 XIX or XXI may be the basis for determining 

17 eligibility for the Energy Refund Program. 

18 ‘‘(D) Notwithstanding any other provision 

19 of this section, the Secretary may authorize 

20 States to provide benefits under this section on 

21 a quarterly basis if the Secretary determines 

22 that the amount of the benefits that would be 

23 provided on a monthly basis to households is in24 sufficient to be efficiently paid on a monthly 


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1 basis in light of the administrative expenses of 

2 the Energy Refund Program. 

3 ‘‘(g) TREATMENT.—The value of the refund provided 

4 under this section shall not be considered income or re5 sources for any purpose under any Federal, State, or local 

6 laws, including, but not limited to, laws relating to an in7 come tax, or public assistance programs (including, but 

8 not limited to, health care, cash aid, child care, nutrition 

9 programs, and housing assistance) and no participating 

10 State or political subdivision thereof shall decrease any as11 sistance otherwise provided an individual or individuals be12 cause of the receipt of a refund under this section. 

13 ‘‘(h) PROGRAM INTEGRITY.—For purposes of ensur14 ing program integrity and complying with the require15 ments of the Improper Payment Information Act of 2002, 

16 the Secretary shall, to the maximum extent possible, rely 

17 on and coordinate with the quality control sample and re18 view procedures of paragraphs (2), (3), (4), and (5) of 

19 section 16(c) of the Food and Nutrition Act of 2008 (7 

20 U.S.C. 2025(c)). 

21 ‘‘(i) DEFINITIONS.— 

22 ‘‘(1) SECRETARY.—The term ‘Secretary’ means 

23 the Secretary of Health and Human Services or the 

24 head of another agency designated by the Secretary 

25 of Health and Human Services. 


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1 ‘‘(2) ELECTRONIC BENEFIT TRANSFER SYS2 TEM.—The term ‘electronic benefit transfer system’ 

3 means a system by which household benefits or re4 funds defined under subsection (e) are issued from 

5 and stored in a central databank via electronic ben6 efit transfer cards. 

7 ‘‘(3) GROSS INCOME.—The term ‘gross income’ 

8 means the gross income of a household that is deter9 mined in accordance with standards and procedures 

10 established under section 5 of the Food and Nutri11 tion Act of 2008 (7 U.S.C. 2014) and its imple12 menting regulations. 

13 ‘‘(4) HOUSEHOLD.— 

14 ‘‘(A) The term ‘household’ means— 

15 ‘‘(i) in subparagraphs (A) and (B) of 

16 subsection (c)(1) of this section, except as 

17 provided in subparagraph (C) of this para18 graph, an individual or a group of individ19 uals who are a household under section 

20 3(n) of the Food and Nutrition Act of 

21 2008 (7 U.S.C. 2012(n)); 

22 ‘‘(ii) in subsection (c)(1)(C) of this 

23 section, a single individual or married cou24 ple that receives benefits under section 


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1 1860D–14 of this Act (42 U.S.C. 1395w– 

2 114); and 

3 ‘‘(iii) in subsection (c)(1)(D) of this 

4 section, a single individual or married cou5 ple that receives benefits under the supple6 mental security income program under title 

7 XVI of this Act (42 U.S.C. 1381–1383f). 

8 ‘‘(B) The Secretary shall establish rules 

9 for providing the energy refund in an equitable 

10 and administratively simple manner to house11 holds where the group of individuals who live 

12 together includes members not all of whom are 

13 described in a single clause of subparagraph 

14 (A), or includes additional members not de15 scribed in any such clause. 

16 ‘‘(C) The Secretary shall establish rules re17 garding the eligibility and delivery of the energy 

18 refund to groups of individuals described in sec19 tion 3(n)(4) or (5) of the Food and Nutrition 

20 Act of 2008 (7 U.S.C. 2012(n)). 

21 ‘‘(5) POVERTY LINE.—The term ‘poverty line’ 

22 has the meaning given the term in section 673(2) of 

23 the Community Services Block Grant Act (42 U.S.C. 

24 9902(2)), including any revision required by that 

25 section. 


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1 ‘‘(6) STATE.—The term ‘State’ means the 50 

2 States, the District of Columbia, the Commonwealth 

3 of Puerto Rico, American Samoa, the United States 

4 Virgin Islands, Guam, and the Commonwealth of the 

5 Northern Mariana Islands. 

6 ‘‘(7) STATE AGENCY.—The term ‘State agency’ 

7 means an agency of State government, including the 

8 local offices thereof, that has responsibility for ad9 ministration of the 1 or more federally aided public 

10 assistance programs within the State, and in those 

11 States where such assistance programs are operated 

12 on a decentralized basis, the term shall include the 

13 counterpart local agencies administering such pro14 grams. 

15 ‘‘(8) OTHER TERMS.—Other terms not defined 

16 in this title shall have the same meaning applied in 

17 the Supplemental Nutrition Assistance Program au18 thorized by the Food and Nutrition Act of 2008 (7 

19 U.S.C. 2011 et seq.) unless the Secretary finds for 

20 good cause that application of a particular definition 

21 would be detrimental to the purposes of the Energy 

22 Refund Program.’’. 


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1 SEC. 432. MODIFICATION OF EARNED INCOME CREDIT 

2 AMOUNT FOR INDIVIDUALS WITH NO QUALI3 FYING CHILDREN. 

4 (a) INCREASE IN CREDIT PERCENTAGE AND PHASE5 OUT PERCENTAGE FOR INDIVIDUALS WITH NO CHIL6 DREN.—The table contained in subparagraph (A) of sec7 tion 32(b)(1) of the Internal Revenue Code of 1986 is 

8 amended by striking ‘‘7.65’’ each place it appears and in9 serting ‘‘15.3’’. 

10 (b) INCREASE IN BEGINNING PHASEOUT AMOUNT.— 

11 (1) IN GENERAL.—The table contained in sub12 paragraph (A) of section 32(b)(2) of such Code is 

13 amended by striking ‘‘$5,280’’ and inserting 

14 ‘‘$13,590’’. 

15 (2) INFLATION ADJUSTMENT.— 

16 (A) IN GENERAL.—Subparagraph (B) of 

17 section 32(j)(1) of such Code is amended by 

18 striking ‘‘and’’ at the end of clause (i), by re19 designating clause (ii) as clause (iii), and by in20 serting after clause (i) the following new clause: 

21 ‘‘(ii) in the case of the $13,590 

22 amount in subsection (b)(2)(A), by sub23 stituting ‘calendar year 2011’ for ‘calendar 

24 year 1992’ in subparagraph (B) thereof, 

25 and’’. 

26 (B) CONFORMING AMENDMENTS.— 


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1 (i) Clause (i) of section 32(j)(1)(B) of 

2 such Code is amended by inserting ‘‘except 

3 as provided in clause (ii),’’ before ‘‘in the 

4 case of’’. 

5 (ii) Paragraph (1) of section 32(j) of 

6 such Code is amended by inserting ‘‘(2012 

7 in the case of the $13,590 amount in sub8 section (b)(2)(A))’’ after ‘‘1996’’. 

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

10 this section shall apply to taxable years beginning after 

11 December 31, 2011. 

12 SEC. 433. PROTECTION OF SOCIAL SECURITY AND MEDI13 CARE TRUST FUNDS. 

14 (a) OASDI TRUST FUNDS.—Section 201 of the So15 cial Security Act (42 U.S.C. 401) is amended by adding 

16 at the end the following new subsection: 

17 ‘‘(o) The Secretary of the Treasury shall transfer 

18 from time to time to the Federal Old-Age and Survivors 

19 Insurance Trust Fund and the Federal Disability Insur20 ance Trust Fund, from amounts in the general fund of 

21 the Treasury that are not otherwise appropriated, such 

22 sums as the Chief Actuary of the Social Security Adminis23 tration calculates as necessary (and so certifies to such 

24 Secretary) for any fiscal year, on account of changes in 

25 benefit costs and changes in tax revenue attributable to 


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1 the provisions of the American Clean Energy and Security 

2 Act of 2009 and the amendments made thereby, in order 

3 to place each of such Trust Funds in the same position 

4 at the end of such fiscal year as the position in which such 

5 Trust Fund would have been if such changes had not oc6 curred.’’. 

7 (b) HI TRUST FUND.—Section 1817 of such Act (42 

8 U.S.C. 1395i) is amended by adding at the end the fol9 lowing new subsection: 

10 ‘‘(l) TRANSFERS TO ACCOUNT FOR CHANGES IN

11 BENEFIT COSTS AND CHANGES IN TAX REVENUE AT12 TRIBUTABLE TO THE AMERICAN CLEAN ENERGY AND SE13 CURITY ACT OF 2009.—The Secretary of the Treasury 

14 shall transfer from time to time to the Trust Fund, from 

15 amounts in the general fund of the Treasury that are not 

16 otherwise appropriated, such sums as the Chief Actuary 

17 of the Centers for Medicare & Medicaid Services calculates 

18 as necessary (and so certifies to such Secretary) for any 

19 fiscal year, on account of changes in benefit costs and 

20 changes in tax revenue attributable to the provisions of 

21 the American Clean Energy and Security Act of 2009 and 

22 the amendments made thereby, in order to place the Trust 

23 Fund in the same position at the end of such fiscal year 

24 as the position in which it would have been if such changes 

25 had not occurred.’’. 


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1 Subtitle D—Exporting Clean 

2 Technology 

3 SEC. 441. FINDINGS AND PURPOSES. 

4 (a) FINDINGS.—Congress finds the following: 

5 (1) Protecting Americans from the impacts of 

6 climate change requires global reductions in green7 house gas emissions. 

8 (2) Although developing countries are histori9 cally least responsible for the cumulative greenhouse 

10 gas emissions that are causing climate change and 

11 continue to have very low per capita greenhouse gas 

12 emissions, their overall greenhouse gas emissions are 

13 increasing as they seek to grow their economies and 

14 reduce energy poverty for their populations. 

15 (3) Many developing countries lack the financial 

16 and technical resources to adopt clean energy tech17 nologies and absent assistance their greenhouse gas 

18 emissions will continue to increase. 

19 (4) Investments in clean energy technology co20 operation can substantially reduce global greenhouse 

21 gas emissions while providing developing countries 

22 with incentives to adopt policies that will address 

23 competitiveness concerns related to regulation of 

24 United States greenhouse gas emissions. 


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1 (5) Investments in clean technology in devel2 oping countries will increase demand for clean en3 ergy products, open up new markets for United 

4 States companies, spur innovation, and lower costs. 

5 (6) Under Article 4 of the United Nations 

6 Framework Convention on Climate Change, devel7 oped country parties, including the United States, 

8 committed to ‘‘take all practicable steps to promote, 

9 facilitate, and finance, as appropriate, the transfer 

10 of, or access to, environmentally sound technologies 

11 and know-how to other parties, particularly devel12 oping country parties, to enable them to implement 

13 the provisions of the Convention’’. 

14 (7) Under the Bali Action Plan, developed 

15 country parties to the United Nations Framework 

16 Convention on Climate Change, including the United 

17 States, committed to ‘‘enhanced action on the provi18 sion of financial resources and investment to support 

19 action on mitigation and adaptation and technology 

20 cooperation,’’ including, inter alia, consideration of 

21 ‘‘improved access to adequate, predictable, and sus22 tainable financial resources and financial and tech23 nical support, and the provision of new and addi24 tional resources, including official and concessional 

25 funding for developing country parties’’. 


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1 (8) Intellectual property rights are a key driver 

2 of investment and research and development in, and 

3 the global deployment of, clean technologies. 

4 (9) Innovative clean technologies, including 

5 U.S. and multilateral financing mechanisms for their 

6 deployment, are critical to mitigating global warming 

7 pollution, preventing catastrophic changes to the cli8 mate, and developing robust economies around the 

9 world. 

10 (10) Any weakening of intellectual property 

11 rights protection poses a substantial competitive risk 

12 to U.S. companies and the creation of high-quality 

13 U.S. jobs, inhibiting the creation of new ‘‘green’’ 

14 employment and the transformational shift to the 

15 ‘‘Green Economy’’ of the 21st Century. 

16 (11) Any U.S. funding directed toward assist17 ing developing countries with regard to exporting 

18 clean technology should promote the robust compli19 ance with and enforcement of existing international 

20 legal requirements for the protection of intellectual 

21 property rights as formulated in the Agreement on 

22 Trade-Related Aspects of Intellectual Property 

23 Rights, referred to in section 101(d)(15) of the Uru24 guay Round Agreements Act (19 U.S.C.3511(d)(15) 


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1 and in applicable intellectual property provisions of 

2 bilateral trade agreements. 

3 (b) PURPOSES.—The purposes of this subtitle are— 

4 (1) to provide United States assistance and le5 verage private resources to encourage widespread 

6 implementation, in developing countries, of activities 

7 that reduce, sequester, or avoid greenhouse gas 

8 emissions; and 

9 (2) to provide such assistance in a manner 

10 that— 

11 (A) encourages such countries to adopt 

12 policies and measures, including sector-based 

13 and cross-sector policies and measures, that 

14 substantially reduce, sequester, or avoid green15 house gas emissions; 

16 (B) promotes the successful negotiation of 

17 a global agreement to reduce greenhouse gas 

18 emissions under the United Nations Framework 

19 Convention on Climate Change; and 

20 (C) promotes robust compliance with and 

21 enforcement of existing international legal re22 quirements for the protection of intellectual 

23 property rights, as formulated in the Agreement 

24 on Trade-Related Aspects of Intellectual Prop25 erty Rights referred to in section 101(d)(15) of 


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1 the Uruguay Round Agreements Act (19 U.S.C. 

2 3511(d)(15)) and in applicable intellectual 

3 property provisions of bilateral trade agree4 ments. 

5 SEC. 442. DEFINITIONS. 

6 In this subtitle: 

7 (1) ALLOWANCE.—The term ‘‘allowance’’ 

8 means an emission allowance established under sec9 tion 721 of the Clean Air Act. 

10 (2) APPROPRIATE CONGRESSIONAL COMMIT11 TEES.—The term ‘‘appropriate congressional com12 mittees’’ means— 

13 (A) the Committees on Energy and Com14 merce, Foreign Affairs, and Financial Services 

15 of the House of Representatives; and 

16 (B) the Committees on Environment and 

17 Public Works, Energy and Natural Resources, 

18 and Foreign Relations of the Senate. 

19 (3) CONVENTION.—The term ‘‘Convention’’ 

20 means the United Nations Framework Convention 

21 on Climate Change, done at New York on May 9, 

22 1992, and entered into force on March 21, 1994. 

23 (4) DEVELOPING COUNTRY.—The term ‘‘devel24 oping country’’ means a country eligible to receive 

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1 come guidelines of the Development Assistance Com2 mittee of the Organization for Economic Coopera3 tion and Development. 

4 (5) ELIGIBLE COUNTRY.—The term ‘‘eligible 

5 country’’ means a developing country that is deter6 mined by the interagency group under section 444 

7 to be eligible to receive assistance from the Inter8 national Clean Technology Account. 

9 (6) INTERAGENCY GROUP.—The term ‘‘inter10 agency group’’ means the group established by the 

11 President under section 443 to administer distribu12 tions from the International Clean Technology Ac13 count. 

14 (7) INTERNATIONAL CLEAN TECHNOLOGY AC15 COUNT.—The term ‘‘International Clean Technology 

16 Account’’ means the account to which the Adminis17 trator allocates allowances under section 782(o) of 

18 the Clean Air Act. 

19 (8) LEAST DEVELOPED COUNTRY.—The term 

20 ‘‘least developed country’’ means a foreign country 

21 the United Nations has identified as among the least 

22 developed of developing countries. 

23 (9) QUALIFYING ACTIVITY.—The term ‘‘quali24 fying activity’’ means an activity that meets the cri25 teria in section 445. 


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1 (10) QUALIFYING ENTITY.—The term ‘‘quali2 fying entity’’ means a national, regional, or local 

3 government in, or a nongovernmental organization 

4 or private entity located or operating in, an eligible 

5 country. 

6 SEC. 443. GOVERNANCE. 

7 (a) OVERSIGHT.—The Secretary of State, or such 

8 other Federal agency head as the President may des9 ignate, in consultation with the interagency group estab10 lished under subsection (b), shall oversee distributions of 

11 allowances from the International Clean Technology Ac12 count. 

13 (b) INTERAGENCY GROUP.—The President shall es14 tablish an interagency group to administer the Inter15 national Clean Technology Account. The Members of the 

16 interagency group shall include— 

17 (1) the Secretary of State; 

18 (2) the Administrator of the Environmental 

19 Protection Agency; 

20 (3) the Secretary of Energy; 

21 (4) the Secretary of the Treasury; 

22 (5) the Secretary of Commerce; 

23 (6) the Administrator of the United States 

24 Agency for International Development; and 


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1 (7) any other head of a Federal agency or exec2 utive branch appointee that the President may des3 ignate. 

4 (c) CHAIRPERSON.—The Secretary of State shall 

5 serve as the chairperson of the interagency group. 

6 (d) SUPPLEMENT NOT SUPPLANT.—Allowances dis7 tributed from the International Clean Technology Account 

8 shall be used to supplement, and not to supplant, any 

9 other Federal, State, or local resources available to carry 

10 out activities that are qualifying activities under this sub11 title. 

12 SEC. 444. DETERMINATION OF ELIGIBLE COUNTRIES. 

13 (a) IN GENERAL.—The interagency group shall de14 termine a country to be an eligible country for the pur15 poses of this subtitle if a country meets the following cri16 teria: 

17 (1) The country is a developing country that— 

18 (A) has entered into an international 

19 agreement to which the United States is a 

20 party, under which such country agrees to take 

21 actions to produce measurable, reportable, and 

22 verifiable greenhouse gas emissions mitigation; 

23 or 

24 (B) is determined by the interagency group 

25 to have in force national policies and measures 


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1 that are capable of producing measurable, re2 portable, and verifiable greenhouse gas emis3 sions mitigation. 

4 (2) The country has developed a nationally ap5 propriate mitigation strategy that seeks to achieve 

6 substantial reductions, sequestration, or avoidance of 

7 greenhouse gas emissions, relative to business-as8 usual levels. 

9 (3) Subject to subsection (b)(1), such other cri10 teria as the President determines will serve the pur11 poses of this subtitle or other United States national 

12 security, foreign policy, environmental, or economic 

13 objectives including robust compliance with and en14 forcement of existing international legal require15 ments for the protection of intellectual property 

16 rights for clean technology, as formulated in the 

17 Agreement on Trade-Related Aspects of Intellectual 

18 Property Rights, referred to in section 101(d)(15) of 

19 the Uruguay Round Agreements Act (19 U.S.C. 

20 3511(d)(15)) and in applicable intellectual property 

21 provisions of bilateral trade agreements. 

22 (b) EXCEPTIONS.— 

23 (1) Subsection (a)(3) applies only to bilateral 

24 assistance under section 446(c)(4). 


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1 (2) The eligibility criteria in this section do not 

2 apply in the case of least developed countries receiv3 ing assistance under section 445(7) for the purpose 

4 of building capacity to meet such eligibility criteria. 

5 SEC. 445. QUALIFYING ACTIVITIES. 

6 Assistance under this subtitle may be provided only 

7 to qualifying entities for clean technology activities (in8 cluding building relevant technical and institutional capac9 ity) that contribute to substantial, measurable, reportable, 

10 and verifiable reductions, sequestration, or avoidance of 

11 greenhouse gas emissions including— 

12 (1) deployment of technologies to capture and 

13 sequester carbon dioxide emissions from electric gen14 erating units or large industrial sources (except that 

15 assistance under this subtitle for such deployment 

16 shall be limited to the cost of retrofitting existing fa17 cilities with such technologies or the incremental 

18 cost of purchasing and installing such technologies 

19 at new facilities); 

20 (2) deployment of renewable electricity genera21 tion from wind, solar, sustainably produced biomass, 

22 geothermal, marine, or hydrokinetic sources; 

23 (3) substantial increases in the efficiency of 

24 electricity transmission, distribution, and consump25 tion; 


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1 (4) deployment of low- or zero emissions tech2 nologies that are facing financial or other barriers to 

3 their widespread deployment which could be ad4 dressed through support under this subtitle in order 

5 to reduce, sequester, or avoid emission; 

6 (5) reduction in transportation sector emissions 

7 through increased transportation system and vehicle 

8 efficiency or use of transportation fuels that have 

9 lifecycle greenhouse gas emissions that are substan10 tially lower than those attributable to fossil fuel11 based alternatives; 

12 (6) reduction in black carbon emissions; or 

13 (7) capacity building activities, including— 

14 (A) developing and implementing meth15 odologies and programs for measuring and 

16 quantifying greenhouse gas emissions and 

17 verifying emissions mitigation; 

18 (B) assessing, developing, and imple19 menting technology and policy options for 

20 greenhouse gas emissions mitigation and avoid21 ance of future emissions, including sector and 

22 cross-sector mitigation strategies; and 

23 (C) providing other forms of technical as24 sistance to facilitate the qualification for, and 

25 receipt of, assistance under this Act. 


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1 SEC. 446. ASSISTANCE. 

2 (a) IN GENERAL.—The Secretary of State, or such 

3 other Federal agency head as the President may des4 ignate, is authorized to provide assistance, through the 

5 distribution of allowances, from the International Clean 

6 Technology Account for qualifying activities that take 

7 place in eligible countries. 

8 (b) ANNUAL REPORTS.—Not later than March 1, 

9 2012, and annually thereafter, the President shall submit 

10 to the appropriate congressional committees a report on 

11 the assistance provided under this subtitle during the prior 

12 fiscal year. Such report shall include— 

13 (1) a description of the amount and value of al14 lowances distributed during the prior fiscal year; 

15 (2) a description of each activity that received 

16 assistance during the prior fiscal year, and a de17 scription of the anticipated and actual outcomes; 

18 (3) an assessment of any adverse effects to 

19 human health, safety, or welfare, the environment, 

20 or natural resources as a result of activities sup21 ported under this subtitle; 

22 (4) an assessment of the success of the assist23 ance provided under this subtitle to improving the 

24 technical and institutional capacity to implement 

25 substantial emissions reductions; 


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1 (5) an estimate of the greenhouse gas emissions 

2 reductions, sequestration, or avoidance achieved by 

3 assistance provided under this subtitle during the 

4 prior fiscal year; and 

5 (6) an assessment whether any funds expended 

6 for the benefit of any qualifying activity undermined 

7 the protection of intellectual property rights for 

8 clean technology, as formulated in the Agreement on 

9 Trade-Related Aspects of Intellectual Property 

10 Rights, referred to in section 101(d)(15) of the Uru11 guay Round Agreements Act (19 U.S.C. 

12 3511(d)(15)) and applicable intellectual property 

13 provisions of bilateral trade agreements. 

14 (c) DISTRIBUTION OF ALLOWANCES.— 

15 (1) IN GENERAL.—The Secretary of State, or 

16 such other Federal agency head as the President 

17 may designate, after consultation with the inter18 agency group, shall distribute allowances from the 

19 International Clean Technology Account— 

20 (A) in the form of bilateral assistance in 

21 accordance with paragraph (4); 

22 (B) to multilateral funds or institutions 

23 pursuant to the Convention or an agreement 

24 negotiated under the Convention; or 


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1 (C) through some combination of the 

2 mechanisms identified in subparagraphs (A) 

3 and (B). 

4 (2) GLOBAL ENVIRONMENT FACILITY.—For any 

5 allowances provided to the Global Environment Fa6 cility pursuant to paragraph (1)(B), the President 

7 shall designate the Secretary of the Treasury to dis8 tribute those allowances to the Global Environment 

9 Facility. 

10 (3) DISTRIBUTION THROUGH INTERNATIONAL

11 FUND OR INSTITUTION.—If allowances are distrib12 uted to a multilateral fund or institution, as author13 ized in paragraph (1), the Secretary of State, or 

14 such other Federal agency head as the President 

15 may designate, shall seek to ensure the establish16 ment and implementation of adequate mechanisms 

17 to— 

18 (A) apply and enforce the criteria for de19 termination of eligible countries and qualifying 

20 activities under sections 444 and 445, respec21 tively; 

22 (B) require public reporting describing the 

23 process and methodology for selecting the ulti24 mate recipients of assistance and a description 

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1 ing the amount of obligations and expenditures 

2 for assistance; and 

3 (C) require that no funds be expended for 

4 the benefit of any qualifying activity where that 

5 activity or any activity relating to a qualifying 

6 activity under section 445 undermines the ro7 bust compliance with and enforcement of exist8 ing legal requirements for the protection of in9 tellectual property rights for clean technology, 

10 as formulated in the Agreement on Trade-Re11 lated Aspects of Intellectual Property Rights, 

12 referred to in section 101(d)(15) of the Uru13 guay Round Agreements Act (19 U.S.C. 

14 3511(d)(15)). 

15 (4) BILATERAL ASSISTANCE.— 

16 (A) IN GENERAL.—Bilateral assistance 

17 under paragraph (1) shall be carried out by the 

18 Administrator of the United States Agency for 

19 International Development, in consultation with 

20 the interagency group. 

21 (B) LIMITATIONS.—Not more than 15 per22 cent of allowances made available to carry out 

23 bilateral assistance under this subtitle in any 

24 year shall be distributed to support activities in 

25 any single country. 


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1 (C) SELECTION CRITERIA.—Not later than 

2 2 years after the date of enactment of this sub3 title, the Administrator of the United States 

4 Agency for International Development, after 

5 consultation with the interagency group, shall 

6 develop and publish a set of criteria to be used 

7 in evaluating activities within eligible countries 

8 for bilateral assistance under this subtitle. 

9 (D) CRITERIA REQUIREMENTS.—The cri10 teria under subparagraph (C) shall require 

11 that— 

12 (i) the activity is a qualifying activity; 

13 (ii) the activity will be conducted as 

14 part of an eligible country’s nationally ap15 propriate mitigation strategy or as part of 

16 an eligible country’s actions towards pro17 viding a nationally appropriate mitigation 

18 strategy to reduce, sequester, or avoid 

19 emissions being implemented by the eligi20 ble country; 

21 (iii) the activity will not have adverse 

22 effects on human health, safety, or welfare, 

23 the environment, or natural resources; 


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1 (iv) any technologies deployed through 

2 bilateral assistance under this subtitle will 

3 be properly implemented and maintained; 

4 (v) the activity will not cause any net 

5 loss of United States jobs or displacement 

6 of United States production; 

7 (vi) costs of the activity will be shared 

8 by the host country government, private 

9 sector parties, or a multinational develop10 ment bank, except that this clause does not 

11 apply to least developed countries; 

12 (vii) the activity would not undermine 

13 the protection of intellectual property 

14 rights for clean technology, as formulated 

15 in the Agreement on Trade-Related As16 pects of Intellectual Property Rights, re17 ferred to in section 101(d)(15) of the Uru18 guay Round Agreements Act (19 U.S.C. 

19 3511(d)(15)) and applicable intellectual 

20 property provisions of bilateral trade 

21 agreements; and 

22 (viii) the activity meets such other re23 quirements as the interagency group deter24 mines appropriate to further the purposes 

25 of this subtitle. 


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1 (E) CRITERIA PREFERENCES.—The cri2 teria under subparagraph (C) shall give pref3 erence to activities that— 

4 (i) promise to achieve large-scale 

5 greenhouse gas reductions, sequestration, 

6 or avoidance at a national, sectoral or 

7 cross-sectoral level; 

8 (ii) have the potential to catalyze a 

9 shift within the host country towards wide10 spread deployment of low- or zero-carbon 

11 energy technologies; 

12 (iii) build technical and institutional 

13 capacity and other activities that are un14 likely to be attractive to private sector 

15 funding; or 

16 (iv) maximize opportunities to lever17 age other sources of assistance and cata18 lyze private-sector investment. 

19 (d) MONITORING, EVALUATION, AND ENFORCE20 MENT.—The Secretary of State, or such other Federal 

21 agency head as the President may designate, in consulta22 tion with the interagency group, shall establish and imple23 ment a system to monitor and evaluate the performance 

24 of activities receiving assistance under this subtitle. The 

25 Secretary of State, or such other Federal agency head as 


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1 the President may designate, shall have the authority to 

2 suspend or terminate assistance in whole or in part for 

3 an activity if it is determined that the activity is not oper4 ating in compliance with the approved proposal. 

5 (e) COORDINATION WITH U.S. FOREIGN ASSIST6 ANCE.—Subject to the direction of the President, the Sec7 retary of State shall, to the extent practicable, seek to 

8 align activities under this section with broader develop9 ment, poverty alleviation, or natural resource management 

10 objectives and initiatives in the recipient country. 

11 (f) DEFINITION.—For the purposes of this section 

12 the term ‘‘clean technology’’ means any technology or 

13 service related to the qualifying activities identified in sec14 tion 445. 

15 Subtitle E—Adapting to Climate 

16 Change 

17 PART 1—DOMESTIC ADAPTATION 

18 Subpart A—National Climate Change Adaptation 

19 Program 

20 SEC. 451. GLOBAL CHANGE RESEARCH AND DATA MANAGE21 MENT. 

22 (a) SHORT TITLE.—This section may be cited as the 

23 ‘‘Global Change Research and Data Management Act of 

24 2009’’. 

25 (b) GLOBAL CHANGE RESEARCH.— 


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1 (1) PURPOSE.—The purpose of this subsection 

2 is to provide for the continuation and coordination 

3 of a comprehensive and integrated United States ob4 servation, research, and outreach program which will 

5 assist the Nation and the world to understand, as6 sess, predict, and respond to the effects of human7 induced and natural processes of global change. 

8 (2) DEFINITIONS.—For purposes of this sub9 section— 

10 (A) the term ‘‘global change’’ means 

11 human-induced or natural changes in the global 

12 environment (including alterations in climate, 

13 land productivity, oceans or other water re14 sources, atmospheric chemistry, biodiversity, 

15 and ecological systems) that may alter the ca16 pacity of the Earth to sustain life; 

17 (B) the term ‘‘global change research’’ 

18 means study, monitoring, assessment, pre19 diction, and information management activities 

20 to describe and understand— 

21 (i) the interactive physical, chemical, 

22 and biological processes that regulate the 

23 total Earth system; 

24 (ii) the unique environment that the 

25 Earth provides for life; 


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1 (iii) changes that are occurring in the 

2 Earth system; and 

3 (iv) the manner in which such system, 

4 environment, and changes are influenced 

5 by human actions; 

6 (C) the term ‘‘interagency committee’’ 

7 means the interagency committee established 

8 under paragraph (3); 

9 (D) the term ‘‘Plan’’ means the National 

10 Global Change Research and Assessment Plan 

11 developed under paragraph (5); 

12 (E) the term ‘‘Program’’ means the United 

13 States Global Change Research Program estab14 lished under paragraph (4); and 

15 (F) the term ‘‘regional climate change’’ 

16 means the natural or human-induced changes 

17 manifested in the local or regional environment 

18 (including alterations in weather patterns, land 

19 productivity, water resources, sea level rise, at20 mospheric chemistry, biodiversity, and ecologi21 cal systems) that may alter the capacity of a 

22 specific region to support current or future so23 cial and economic activity or natural eco24 systems. 


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1 (3) INTERAGENCY COOPERATION AND COORDI2 NATION.— 

3 (A) ESTABLISHMENT.—The President 

4 shall establish or designate an interagency com5 mittee to ensure cooperation and coordination 

6 of all Federal research activities pertaining to 

7 processes of global change for the purpose of 

8 increasing the overall effectiveness and produc9 tivity of Federal global change research efforts. 

10 The interagency committee shall include re11 search and program representatives of agencies 

12 conducting global change research, agencies 

13 with authority over resources likely to be af14 fected by global change, and agencies with au15 thority to mitigate human-induced global 

16 change. 

17 (B) FUNCTIONS OF THE INTERAGENCY

18 COMMITTEE.—The interagency committee 

19 shall— 

20 (i) serve as the forum for developing 

21 the Plan and for overseeing its implemen22 tation; 

23 (ii) serve as the forum for developing 

24 the vulnerability assessment under para25 graph (7); 


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1 (iii) ensure cooperation among Fed2 eral agencies with respect to global change 

3 research activities; 

4 (iv) work with academic, State, indus5 try, and other groups conducting global 

6 change research, to provide for periodic 

7 public and peer review of the Program; 

8 (v) cooperate with the Secretary of 

9 State in— 

10 (I) providing representation at 

11 international meetings and con12 ferences on global change research in 

13 which the United States participates; 

14 and 

15 (II) coordinating the Federal ac16 tivities of the United States with pro17 grams of other nations and with inter18 national global change research activi19 ties; 

20 (vi) work with appropriate Federal, 

21 State, regional, and local authorities to en22 sure that the Program is designed to 

23 produce information needed to develop 

24 policies to mitigate human-induced global 

25 change and to reduce the vulnerability of 


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1 the United States and other regions to 

2 global change; 

3 (vii) facilitate ongoing dialog and in4 formation exchange with regional, State, 

5 and local governments and other user com6 munities; and 

7 (viii) identify additional decision8 making groups that may use information 

9 generated through the Program. 

10 (4) UNITED STATES GLOBAL CHANGE RE11 SEARCH PROGRAM.— 

12 (A) ESTABLISHMENT.—The President 

13 shall establish an interagency United States 

14 Global Change Research Program to improve 

15 understanding of global change, to respond to 

16 the information needs of communities and deci17 sionmakers, and to provide periodic assessments 

18 of the vulnerability of the United States and 

19 other regions to global and regional climate 

20 change. The Program shall be implemented in 

21 accordance with the Plan. 

22 (B) LEAD AGENCY.—The lead agency for 

23 the United States Global Change Research Pro24 gram shall be the Office of Science and Tech25 nology Policy. 


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1 (C) INTERAGENCY PROGRAM ACTIVITIES.— 

2 The Director of the Office of Science and Tech3 nology Policy, in consultation with the inter4 agency committee, shall identify activities in5 cluded in the Plan that involve participation by 

6 2 or more agencies in the Program, and that do 

7 not fall within the current fiscal year budget al8 locations of those participating agencies, to ful9 fill the requirements of this section. The Direc10 tor of the Office of Science and Technology Pol11 icy shall allocate funds to the agencies to con12 duct the identified interagency activities. Such 

13 activities may include— 

14 (i) development of scenarios for cli15 mate, land-cover change, population 

16 growth, and socioeconomic development; 

17 (ii) calibration and testing of alter18 native regional and global climate models; 

19 (iii) identification of economic sectors 

20 and regional climatic zones; and 

21 (iv) convening regional workshops to 

22 facilitate information exchange and in23 volvement of regional, State, and local de24 cisionmakers, non-Federal experts, and 


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1 other stakeholder groups in the activities 

2 of the Program. 

3 (D) WORKSHOPS.—The Director shall en4 sure that at least one workshop is held per year 

5 in each region identified by the Plan under 

6 paragraph (5)(B)(xi) to facilitate information 

7 exchange and outreach to regional, State, and 

8 local stakeholders as required by this section. 

9 (E) AUTHORIZATION OF APPROPRIA10 TIONS.—There are authorized to be appro11 priated to the Office of Science and Technology 

12 Policy for carrying out this paragraph 

13 $10,000,000 for each of the fiscal years 2009 

14 through 2014. 

15 (5) NATIONAL GLOBAL CHANGE RESEARCH AND

16 ASSESSMENT PLAN.— 

17 (A) IN GENERAL.—The President shall de18 velop a National Global Change Research and 

19 Assessment Plan for implementation of the Pro20 gram. The Plan shall contain recommendations 

21 for global change research and assessment. The 

22 President shall submit an outline for the devel23 opment of the Plan to the Congress within 1 

24 year after the date of enactment of this Act, 

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1 gress within 3 years after the date of enactment 

2 of this Act. Revised Plans shall be submitted to 

3 the Congress at least once every 5 years there4 after. In the development of each Plan, the 

5 President shall conduct a formal assessment 

6 process under this paragraph to determine the 

7 needs of appropriate Federal, State, regional, 

8 and local authorities and other interested par9 ties regarding the types of information needed 

10 by them in developing policies to mitigate 

11 human-induced global change and to reduce so12 ciety’s vulnerability to global change and shall 

13 utilize these assessments, including the reviews 

14 by the National Academy of Sciences and the 

15 National Governors Association under subpara16 graphs (E) and (F), in developing the Plan. 

17 (B) CONTENTS OF THE PLAN.—The Plan 

18 shall— 

19 (i) establish, for the 10-year period 

20 beginning in the year the Plan is sub21 mitted, the goals and priorities for Federal 

22 global change research which most effec23 tively advance scientific understanding of 

24 global change and provide information of 

25 use to Federal, State, regional, and local 


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1 authorities in the development of policies 

2 relating to global change; 

3 (ii) describe specific activities, includ4 ing efforts to determine user information 

5 needs, research activities, data collection, 

6 database development, and data analysis 

7 requirements, development of regional sce8 narios, assessment of model predictability, 

9 assessment of climate change impacts, par10 ticipation in international research efforts, 

11 and information management, required to 

12 achieve such goals and priorities; 

13 (iii) identify relevant programs and 

14 activities of the Federal agencies that con15 tribute to the Program directly and indi16 rectly; 

17 (iv) set forth the role of each Federal 

18 agency in implementing the Plan; 

19 (v) consider and utilize, as appro20 priate, reports and studies conducted by 

21 Federal agencies, the National Research 

22 Council, or other entities; 

23 (vi) make recommendations for the 

24 coordination of the global change research 

25 and assessment activities of the United 


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1 States with such activities of other nations 

2 and international organizations, includ3 ing— 

4 (I) a description of the extent 

5 and nature of international coopera6 tive activities; 

7 (II) bilateral and multilateral ef8 forts to provide worldwide access to 

9 scientific data and information; and 

10 (III) improving participation by 

11 developing nations in international 

12 global change research and environ13 mental data collection; 

14 (vii) detail budget requirements for 

15 Federal global change research and assess16 ment activities to be conducted under the 

17 Plan; 

18 (viii) catalog the type of information 

19 identified by appropriate Federal, State, 

20 regional, and local decisionmakers needed 

21 to develop policies to reduce society’s vul22 nerability to global change and indicate 

23 how the planned research will meet these 

24 decisionmakers’ information needs; 


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1 (ix) identify the observing systems 

2 currently employed in collecting data rel3 evant to global and regional climate change 

4 research and prioritize additional observa5 tion systems that may be needed to ensure 

6 adequate data collection and monitoring of 

7 global change; 

8 (x) describe specific activities designed 

9 to facilitate outreach and data and infor10 mation exchange with regional, State, and 

11 local governments and other user commu12 nities; and 

13 (xi) identify and describe regions of 

14 the United States that are likely to experi15 ence similar impacts of global change or 

16 are likely to share similar vulnerabilities to 

17 global change. 

18 (C) RESEARCH ELEMENTS.—The Plan 

19 shall include at a minimum the following re20 search elements: 

21 (i) Global measurements, establishing 

22 worldwide to regional scale observations 

23 prioritized to understand global change 

24 and to meet the information needs of deciVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 01057 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 sionmakers on all relevant spatial and time 

2 scales. 

3 (ii) Information on economic, demo4 graphic, and technological trends that con5 tribute to changes in the Earth system and 

6 that influence society’s vulnerability to 

7 global and regional climate change. 

8 (iii) Development of indicators and 

9 baseline databases to document global 

10 change, including changes in species dis11 tribution and behavior, extent of glacia12 tions, and changes in sea level. 

13 (iv) Studies of historical changes in 

14 the Earth system, using evidence from the 

15 geological and fossil record. 

16 (v) Assessments of predictability using 

17 quantitative models of the Earth system to 

18 simulate global and regional environmental 

19 processes and trends. 

20 (vi) Focused research initiatives to 

21 understand the nature of and interaction 

22 among physical, chemical, biological, land 

23 use, and social processes related to global 

24 and regional climate change. 


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1 (vii) Focused research initiatives to 

2 determine and then meet the information 

3 needs of appropriate Federal, State, and 

4 regional decisionmakers. 

5 (D) INFORMATION MANAGEMENT.—The 

6 Plan shall incorporate, to the extent practicable, 

7 the recommendations relating to data acquisi8 tion, management, integration, and archiving 

9 made by the interagency climate and other 

10 global change data management working group 

11 established under subsection (c)(3). 

12 (E) NATIONAL ACADEMY OF SCIENCES

13 EVALUATION.—The President shall enter into 

14 an agreement with the National Academy of 

15 Sciences under which the Academy shall— 

16 (i) evaluate the scientific content of 

17 the Plan; and 

18 (ii) recommend priorities for future 

19 global and regional climate change re20 search and assessment. 

21 (F) NATIONAL GOVERNORS ASSOCIATION

22 EVALUATION.—The President shall enter into 

23 an agreement with the National Governors As24 sociation Center for Best Practices under which 

25 that Center shall— 


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1 (i) evaluate the utility to State, local, 

2 and regional decisionmakers of each Plan 

3 and of the anticipated and actual informa4 tion outputs of the Program for develop5 ment of State, local, and regional policies 

6 to reduce vulnerability to global change; 

7 and 

8 (ii) recommend priorities for future 

9 global and regional climate change re10 search and assessment. 

11 (G) PUBLIC PARTICIPATION.—In devel12 oping the Plan, the President shall consult with 

13 representatives of academic, State, industry, 

14 and environmental groups. Not later than 90 

15 days before the President submits the Plan, or 

16 any revision thereof, to the Congress, a sum17 mary of the proposed Plan shall be published in 

18 the Federal Register for a public comment pe19 riod of not less than 60 days. 

20 (6) BUDGET COORDINATION.— 

21 (A) IN GENERAL.—The President shall 

22 provide general guidance to each Federal agen23 cy participating in the Program with respect to 

24 the preparation of requests for appropriations 

25 for activities related to the Program. 


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1 (B) CONSIDERATION IN PRESIDENT’S

2 BUDGET.—The President shall submit, at the 

3 time of his annual budget request to Congress, 

4 a description of those items in each agency’s 

5 annual budget which are elements of the Pro6 gram. 

7 (7) VULNERABILITY ASSESSMENT.— 

8 (A) REQUIREMENT.—Within 1 year after 

9 the date of enactment of this Act, and at least 

10 once every 5 years thereafter, the President 

11 shall submit to the Congress an assessment 

12 which— 

13 (i) integrates, evaluates, and inter14 prets the findings of the Program and dis15 cusses the scientific uncertainties associ16 ated with such findings; 

17 (ii) analyzes current trends in global 

18 change, both human-induced and natural, 

19 and projects major trends for the subse20 quent 25 to 100 years; 

21 (iii) based on indicators and baselines 

22 developed under paragraph (5)(C)(iii), as 

23 well as other measurements, analyzes 

24 changes to the natural environment, land 


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1 and water resources, and biological diver2 sity in— 

3 (I) major geographic regions of 

4 the United States; and 

5 (II) other continents; 

6 (iv) analyzes the effects of global 

7 change, including the changes described in 

8 clause (iii), on food and fiber production, 

9 energy production and use, transportation, 

10 human health and welfare, water avail11 ability and coastal infrastructure, and 

12 human social and economic systems, in13 cluding providing information about the 

14 differential impacts on specific geographic 

15 regions within the United States, on people 

16 of different income levels within those re17 gions, and for rural and urban areas with18 in those regions; and 

19 (v) summarizes the vulnerability of 

20 different geographic regions of the world to 

21 global change and analyzes the implica22 tions of global change for the United 

23 States, including international assistance, 

24 population displacement, food and resource 

25 availability, and national security. 


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1 (B) USE OF RELATED REPORTS.—To the 

2 extent appropriate, the assessment produced 

3 pursuant to this paragraph may coordinate 

4 with, consider, incorporate, or otherwise make 

5 use of related reports, assessments, or informa6 tion produced by the United States Global 

7 Change Research Program, regional, State, and 

8 local entities, and international organizations, 

9 including the World Meteorological Organiza10 tion and the Intergovernmental Panel on Cli11 mate Change. 

12 (8) POLICY ASSESSMENT.—Not later than 1 

13 year after the date of enactment of this Act, and at 

14 least once every 4 years thereafter, the President 

15 shall enter into a joint agreement with the National 

16 Academy of Public Administration and the National 

17 Academy of Sciences under which the Academies 

18 shall— 

19 (A) document current policy options being 

20 implemented by Federal, State, and local gov21 ernments to mitigate or adapt to the effects of 

22 global and regional climate change; 

23 (B) evaluate the realized and anticipated 

24 effectiveness of those current policy options in 

25 meeting mitigation and adaptation goals; 


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1 (C) identify and evaluate a range of addi2 tional policy options and infrastructure for miti3 gating or adapting to the effects of global and 

4 regional climate change; 

5 (D) analyze the adoption rates of policies 

6 and technologies available to reduce the vulner7 ability of society to global change with an eval8 uation of the market and policy obstacles to 

9 their adoption in the United States; and 

10 (E) evaluate the distribution of economic 

11 costs and benefits of these policy options across 

12 different United States economic sectors. 

13 (9) ANNUAL REPORT.—Each year at the time 

14 of submission to the Congress of the President’s 

15 budget request, the President shall submit to the 

16 Congress a report on the activities conducted pursu17 ant to this subsection, including— 

18 (A) a description of the activities of the 

19 Program during the past fiscal year; 

20 (B) a description of the activities planned 

21 in the next fiscal year toward achieving the 

22 goals of the Plan; and 

23 (C) a description of the groups or cat24 egories of State, local, and regional decision25 makers identified as potential users of the inVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 01064 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 formation generated through the Program and 

2 a description of the activities used to facilitate 

3 consultations with and outreach to these 

4 groups, coordinated through the work of the 

5 interagency committee. 

6 (10) RELATION TO OTHER AUTHORITIES.—The 

7 President shall— 

8 (A) ensure that relevant research, assess9 ment, and outreach activities of the National 

10 Climate Program, established by the National 

11 Climate Program Act (15 U.S.C. 2901 et seq.), 

12 are considered in developing national global and 

13 regional climate change research and assess14 ment efforts; and 

15 (B) facilitate ongoing dialog and informa16 tion exchange with regional, State, and local 

17 governments and other user communities 

18 through programs authorized in the National 

19 Climate Program Act (15 U.S.C. 2901 et seq.). 

20 (11) REPEAL.—The Global Change Research 

21 Act of 1990 (15 U.S.C. 2921 et seq.) is amended by 

22 striking titles I and III thereof. 

23 (12) GLOBAL CHANGE RESEARCH INFORMA24 TION.—The President shall establish or designate a 

25 Global Change Research Information Exchange to 


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1 make scientific research and other information pro2 duced through or utilized by the Program which 

3 would be useful in preventing, mitigating, or adapt4 ing to the effects of global change accessible through 

5 electronic means. 

6 (13) ICE SHEET STUDY AND REPORT.— 

7 (A) STUDY.— 

8 (i) REQUIREMENT.—The Director of 

9 the National Science Foundation and the 

10 Administrator of National Oceanic and At11 mospheric Administration shall enter into 

12 an arrangement with the National Acad13 emy of Sciences to complete a study of the 

14 current status of ice sheet melt, as caused 

15 by climate change, with implications for 

16 global sea level rise. 

17 (ii) CONTENTS.—The study shall take 

18 into consideration— 

19 (I) the past research completed 

20 related to ice sheet melt as reviewed 

21 by Working Group I of the Intergov22 ernmental Panel on Climate Change; 

23 (II) additional research com24 pleted since the fall of 2005 that was 


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1 not included in the Working Group I 

2 report due to time constraints; and 

3 (III) the need for an accurate as4 sessment of changes in ice sheet 

5 spreading, changes in ice sheet flow, 

6 self-lubrication, the corresponding ef7 fect on ice sheets, and current mod8 eling capabilities. 

9 (B) REPORT.—Not later than 18 months 

10 after the date of enactment of this Act, the Na11 tional Academy of Sciences shall transmit to 

12 the Committee on Science and Technology of 

13 the House of Representatives and the Com14 mittee on Commerce, Science, and Transpor15 tation of the Senate a report on the key find16 ings of the study conducted under subpara17 graph (A), along with recommendations for ad18 ditional research related to ice sheet melt and 

19 corresponding sea level rise. 

20 (14) HURRICANE FREQUENCY AND INTENSITY

21 STUDY AND REPORT.— 

22 (A) STUDY.— 

23 (i) REQUIREMENT.—The Adminis24 trator of the National Oceanic and Atmos25 pheric Administration and the Director of 


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1 the National Science Foundation shall 

2 enter into an arrangement with the Na3 tional Academy of Sciences to complete a 

4 study of the current state of the science on 

5 the potential impacts of climate change on 

6 patterns of hurricane and typhoon develop7 ment, including storm intensity, track, and 

8 frequency, and the implications for hurri9 cane-prone and typhoon-prone coastal re10 gions. 

11 (ii) CONTENTS.—The study shall take 

12 into consideration— 

13 (I) the past research completed 

14 related to hurricane and typhoon de15 velopment, track, and intensity as re16 viewed by Working Groups I and II of 

17 the Intergovernmental Panel on Cli18 mate Change; 

19 (II) additional research com20 pleted since the fall of 2005 that was 

21 not included in the Working Group I 

22 and II reports due to time con23 straints; 

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1 ricane and typhoon intensity, track, 

2 and frequency and of the current 

3 modeling and forecasting capabilities 

4 and the need for improvements in 

5 forecasting of these parameters; and 

6 (IV) the need for additional re7 search and monitoring to improve 

8 forecasting of hurricanes and ty9 phoons and to understand the rela10 tionship between climate change and 

11 hurricane and typhoon development. 

12 (B) REPORT.—Not later than 18 months 

13 after the date of enactment of this Act, the Na14 tional Academy of Sciences shall transmit to 

15 the Committee on Science and Technology of 

16 the House of Representatives and the Com17 mittee on Commerce, Science, and Transpor18 tation of the Senate a report on the key find19 ings of the study conducted under subpara20 graph (A). 

21 (c) CLIMATE AND OTHER GLOBAL CHANGE DATA

22 MANAGEMENT.— 

23 (1) PURPOSES.—The purposes of this sub24 section are to establish climate and other global 

25 change data management and archiving as Federal 


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1 agency missions, and to establish Federal policies for 

2 managing and archiving climate and other global 

3 change data. 

4 (2) DEFINITIONS.—For purposes of this sub5 section— 

6 (A) the term ‘‘metadata’’ means informa7 tion describing the content, quality, condition, 

8 and other characteristics of climate and other 

9 global change data, compiled, to the maximum 

10 extent possible, consistent with the require11 ments of the ‘‘Content Standard for Digital 

12 Geospatial Metadata’’ (FGDC–STD–001–1998) 

13 issued by the Federal Geographic Data Com14 mittee, or any successor standard approved by 

15 the working group; and 

16 (B) the term ‘‘working group’’ means the 

17 interagency climate and other global change 

18 data management working group established 

19 under paragraph (3). 

20 (3) INTERAGENCY CLIMATE AND OTHER GLOB21 AL CHANGE DATA MANAGEMENT WORKING GROUP.— 

22 (A) ESTABLISHMENT.—The President 

23 shall establish or designate an interagency cli24 mate and other global change data management 

25 working group to make recommendations for 


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1 coordinating Federal climate and other global 

2 change data management and archiving activi3 ties. 

4 (B) MEMBERSHIP.—The working group 

5 shall include the Administrator of the National 

6 Aeronautics and Space Administration, the Ad7 ministrator of the National Oceanic and Atmos8 pheric Administration, the Secretary of Energy, 

9 the Secretary of Defense, the Director of the 

10 National Science Foundation, the Director of 

11 the United States Geological Survey, the Archi12 vist of the United States, the Administrator of 

13 the Environmental Protection Agency, the Sec14 retary of the Smithsonian Institution, or their 

15 designees, and representatives of any other 

16 Federal agencies the President considers appro17 priate. 

18 (C) REPORTS.—Not later than 1 year after 

19 the date of enactment of this Act, the working 

20 group shall transmit a report to the Congress 

21 containing the elements described in subpara22 graph (D). Not later than 4 years after the ini23 tial report under this subparagraph, and at 

24 least once every 4 years thereafter, the working 

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1 vious report. In preparing reports under this 

2 subparagraph, the working group shall consult 

3 with expected users of the data collected and 

4 archived by the Program. 

5 (D) CONTENTS.—The reports and updates 

6 required under subparagraph (C) shall— 

7 (i) include recommendations for the 

8 establishment, maintenance, and accessi9 bility of a catalog identifying all available 

10 climate and other global change data sets; 

11 (ii) identify climate and other global 

12 change data collections in danger of being 

13 lost and recommend actions to prevent 

14 such loss; 

15 (iii) identify gaps in climate and other 

16 global change data and recommend actions 

17 to fill those gaps; 

18 (iv) identify effective and compatible 

19 procedures for climate and other global 

20 change data collection, management, and 

21 retention and make recommendations for 

22 ensuring their use by Federal agencies and 

23 other appropriate entities; 

24 (v) develop and propose a coordinated 

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1 sibilities among Federal agencies for cli2 mate and other global change data collec3 tion, management, and retention; 

4 (vi) make recommendations for ensur5 ing that particular attention is paid to the 

6 collection, management, and archiving of 

7 metadata; 

8 (vii) make recommendations for en9 suring a unified and coordinated Federal 

10 capital investment strategy with respect to 

11 climate and other global change data col12 lection, management, and archiving; 

13 (viii) evaluate the data record from 

14 each observing system and make rec15 ommendations to ensure that delivered 

16 data are free from time-dependent biases 

17 and random errors before they are trans18 ferred to long-term archives; and 

19 (ix) evaluate optimal design of obser20 vation system components to ensure a cost21 effective, adequate set of observations de22 tecting and tracking global change. 

23 SEC. 452. NATIONAL CLIMATE SERVICE. 

24 (a) SHORT TITLE.—This section may be cited as the 

25 ‘‘National Climate Service Act of 2009’’. 


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1 (b) PURPOSE.—The purpose of this section is to es2 tablish a National Climate Service and to define the activi3 ties to be undertaken within the National Oceanic and At4 mospheric Administration to— 

5 (1) advance understanding of climate variability 

6 and change at the global, national, regional, and 

7 local levels; 

8 (2) provide forecasts, warnings, and other infor9 mation to the public on variability and change in 

10 weather and climate that affect geographic areas, 

11 natural resources, infrastructure, economic sectors, 

12 and communities; and 

13 (3) support development of adaptation and re14 sponse plans by Federal agencies, State, local, and 

15 tribal governments, the private sector, and the pub16 lic. 

17 (c) DEFINITIONS.—In this section: 

18 (1) ADVISORY COMMITTEE.—The term ‘‘Advi19 sory Committee’’ means the Climate Service Advi20 sory Committee established under subsection (f). 

21 (2) DIRECTOR.—The term ‘‘Director’’ means 

22 the Director of the Climate Service Office. 

23 (3) REPRESENTATIVE.—The term ‘‘representa24 tive’’ means an individual who is not a full-time or 

25 part-time employee of the Federal Government and 


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1 who is appointed to an advisory committee to rep2 resent the views of an entity or entities outside the 

3 Federal Government. 

4 (4) SPECIAL GOVERNMENT EMPLOYEE.—The 

5 term ‘‘Special Government Employee’’ has the same 

6 meaning as in section 202(a) of title 18, United 

7 States Code. 

8 (5) UNDER SECRETARY.—The term ‘‘Under 

9 Secretary’’ means the Under Secretary of Commerce 

10 for Oceans and Atmosphere. 

11 (d) INTERAGENCY DEVELOPMENT OF A NATIONAL

12 CLIMATE SERVICE.— 

13 (1) IN GENERAL.—The President shall— 

14 (A) initiate a process within 30 days after 

15 the date of enactment of this Act through the 

16 Committee on Environment and Natural Re17 sources of the National Science and Technology 

18 Council and led by the Director of the Office of 

19 Science and Technology Policy, to evaluate al20 ternative structures to support a collaborative, 

21 interagency research and operational program 

22 that will achieve the goal of meeting the needs 

23 of decisionmakers in— 

24 (i) Federal agencies; 


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1 (ii) State, local, and tribal govern2 ments; 

3 (iii) regional entities and other stake4 holders and users, 

5 for reliable, timely, and relevant information re6 lated to climate variability and change; 

7 (B) within 1 year after the date of enact8 ment of this Act complete pursuant to para9 graph (2) a survey of the needs of current and 

10 future users of information related to climate 

11 variability and change; 

12 (C) within 2 years after the date of enact13 ment of this Act report to Congress under para14 graph (3) the results of the evaluation described 

15 in subparagraph (A) and provide a plan to es16 tablish a collaborative, interagency research and 

17 operational program to deliver information re18 lated to climate variability and change to all 

19 users; and 

20 (D) within 3 years after the date of enact21 ment of this Act, and after delivery of the re22 port to Congress required under subparagraph 

23 (C), establish a National Climate Service, based 

24 upon the information obtained through the 


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1 process described in subparagraph (A), that 

2 meets the goal described in subparagraph (A). 

3 (2) SURVEY OF NEED FOR CLIMATE SERV4 ICES.— 

5 (A) IN GENERAL.—The Director of the Of6 fice of Science and Technology Policy, through 

7 the Committee on Environment and Natural 

8 Resources, shall provide a report to Congress 

9 within 1 year after the date of enactment of 

10 this Act that compiles information on the cur11 rent climate products being delivered by each 

12 Federal agency and its partner organizations to 

13 users and stakeholders, and on the needs of 

14 users and stakeholders for new climate products 

15 and services. 

16 (B) CONTENTS OF THE REPORT.—The re17 port shall identify— 

18 (i) specific user groups and stake19 holders that currently are served by each 

20 Federal agency and its partner organiza21 tions; 

22 (ii) the type of climate products and 

23 services currently delivered to specific 

24 users groups and stakeholders, and the 

25 specific Federal agency office, program, or 


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1 partner organization that delivers these 

2 products and services; 

3 (iii) potential user groups and stake4 holders that may be served by expanding 

5 climate products and services; 

6 (iv) specific needs for new climate 

7 products and services to be delivered by 

8 each Federal agency and its partner orga9 nizations identified by user groups and 

10 stakeholders; 

11 (v) a characterization of the different 

12 user and stakeholder groups that were sur13 veyed by each Federal agency; and 

14 (vi) a list of non-Federal entities that 

15 deliver climate products and services. 

16 (3) REPORT TO CONGRESS.— 

17 (A) IN GENERAL.—Within 2 years after 

18 the date of enactment of this Act, the Director 

19 of the Office of Science and Technology Policy 

20 shall report to the President and the Congress 

21 on a proposal, prepared through the Committee 

22 on Environment and Natural Resources, to es23 tablish and operate a National Climate Service. 

24 The report shall include— 


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1 (i) a description of the alternative 

2 structures considered; 

3 (ii) a description of the structure pro4 posed for a National Climate Service, in5 cluding a discussion of the benefits of this 

6 structure as compared to the alternatives 

7 considered; 

8 (iii) designation of a specific office or 

9 agency that will lead the National Climate 

10 Service and that shall be accountable for 

11 the daily operation of the National Climate 

12 Service; 

13 (iv) a description of the role and capa14 bility of each Federal agency, including a 

15 list of all entities within each agency or 

16 supported with agency funds that currently 

17 provide or may provide climate products or 

18 services; 

19 (v) a description of the mechanisms 

20 that will be used to ensure ongoing com21 munication and information exchange 

22 among the Federal agencies and between 

23 Federal agencies and their respective user 

24 and stakeholder communities including— 


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1 (I) mechanisms to facilitate ongo2 ing dialogue with non-Federal organi3 zations providing climate services; 

4 (II) mechanisms to facilitate on5 going dialogue with regional, State, 

6 local, and tribal governments, the pri7 vate sector, and other users and 

8 stakeholders on the development and 

9 delivery of climate services; 

10 (III) mechanisms to collect infor11 mation, observations, and other data 

12 relevant for improving climate prod13 ucts and services; and 

14 (IV) designation of points of con15 tact for each Federal agency with re16 sponsibilities to deliver climate serv17 ices; 

18 (vi) a detailed description of the proc19 esses and procedures that will be necessary 

20 to coordinate observations and information 

21 collection by different Federal agencies to 

22 ensure the compatibility of information and 

23 to facilitate data and information exchange 

24 among Federal agencies and with non-Fed25 eral entities, and a designation of the 


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1 agency or agencies that would be respon2 sible for ongoing oversight of these func3 tions; 

4 (vii) a detailed description of how re5 search findings and climate impact assess6 ments produced through the United States 

7 Global Change Research Program and the 

8 other activities undertaken within the 

9 United States Global Change Research 

10 Program would be integrated with the ac11 tivities undertaken by a National Climate 

12 Service; 

13 (viii) a list of the existing observation 

14 and monitoring systems or programs oper15 ated by each Federal agency that provide 

16 data, observations, and other information 

17 that may be used to develop or improve cli18 mate products and services; 

19 (ix) a description of new infrastruc20 ture, equipment, personnel or other re21 sources, by agency, that may be needed to 

22 achieve the goals of a National Climate 

23 Service, and the time period over which 

24 these new resources will be allocated; 


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1 (x) an identification of the activities 

2 that may be undertaken in cooperation 

3 with international partners; 

4 (xi) the mechanisms established to 

5 provide quality assurance and quality con6 trol of climate service products and serv7 ices, and the agency or agencies designated 

8 to conduct and oversee these mechanisms; 

9 (xii) an identification of non-Federal 

10 entities that provide climate products and 

11 services, and a description of the relation12 ship envisioned between a National Climate 

13 Service and the non-Federal entities pro14 viding climate services; and 

15 (xiii) responses to the comments re16 ceived during the public comment period. 

17 (B) DRAFT REPORT.—Prior to the submis18 sion of the final report, the Director of the Of19 fice of Science and Technology Policy shall pub20 lish a draft report in the Federal Register with 

21 a comment period of at least 30 days. 

22 (C) CONSULTATION.—In developing the re23 port, the Director of the Office of Science and 

24 Technology Policy shall consult with State, 

25 local, and tribal governments, regional entities, 


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1 the private sector, and other users and stake2 holder groups, and Congress. 

3 (4) ANNUAL REPORT.—The Director of the Of4 fice of Science and Technology Policy shall transmit 

5 to the Congress at the time of the President’s fiscal 

6 year 2013 budget request, and annually thereafter, 

7 a report on the annual anticipated cost of carrying 

8 out the research and operational activities of the Na9 tional Climate Service, with a description of the 

10 budget for each Federal agency’s activities. 

11 (e) CLIMATE SERVICE PROGRAM.— 

12 (1) IN GENERAL.—The Under Secretary, build13 ing upon the resources of the National Weather 

14 Service and other weather and climate programs in 

15 the National Oceanic and Atmospheric Administra16 tion, shall establish a Climate Service Program. 

17 (2) CLIMATE SERVICE OFFICE.—The Under 

18 Secretary shall establish a Climate Service Office 

19 and shall appoint a Director of the Office to collabo20 rate with the leadership of the National Oceanic and 

21 Atmospheric Administration line offices to perform 

22 the duties assigned to the Office. The Climate Serv23 ice Office shall— 

24 (A) coordinate programs at the National 

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1 sure the timely production and distribution of 

2 data and information on global, national, re3 gional, and local climate variability and change 

4 over all time scales relevant for planning and 

5 response, including intraseasonal, interannual, 

6 decadal, and multidecadal time periods; 

7 (B) ensure exchange of information be8 tween the research and operational offices at 

9 the National Oceanic and Atmospheric Admin10 istration to identify research needs for improv11 ing climate products and services and ensure 

12 the timely and orderly transition of research 

13 findings, improved technologies, models, and 

14 other tools to the National Oceanic and Atmos15 pheric Administration’s operations; 

16 (C) ensure operational quality control of all 

17 Climate Service Program products including a 

18 transparent and open accounting of all the as19 sumptions built into the global, national, re20 gional, and local weather and climate computer 

21 models upon which such products are based; 

22 (D) ensure a continuous level of high-qual23 ity data collected through a national observa24 tion and monitoring infrastructure, including at 


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1 a minimum performing regular maintenance 

2 and verification, and periodic upgrades; 

3 (E) serve as liaison to and exchange infor4 mation with other Federal agencies that provide 

5 climate services in order to— 

6 (i) ensure the timely dissemination of 

7 data and information on weather and cli8 mate produced by the National Oceanic 

9 and Atmospheric Administration to other 

10 Federal agencies; 

11 (ii) ensure that data and information 

12 collected by other Federal agencies rel13 evant to improving climate services are 

14 made available to the National Oceanic 

15 and Atmospheric Administration; 

16 (iii) facilitate the development and de17 livery of climate products and services to 

18 relevant stakeholders; and 

19 (iv) obtain information from other 

20 Federal agencies to improve the develop21 ment and dissemination by the National 

22 Oceanic and Atmospheric Administration 

23 of information on weather and climate to 

24 other Federal agencies for the development 


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1 of climate service products by those agen2 cies; 

3 (F) ensure cooperation and collaboration, 

4 as appropriate, of the Climate Service Program 

5 with State, local, and tribal governments, re6 gional entities, academic and nonprofit research 

7 organizations, and private sector entities, in8 cluding weather information providers and 

9 other stakeholders; and 

10 (G) ensure exchange of data, information, 

11 and research with the United States Global 

12 Change Research Program to support the devel13 opment of assessments required under the Glob14 al Change Research Act of 1990 (15 U.S.C. 

15 2921 et seq.). 

16 (3) CLIMATE SERVICE PROGRAM.— 

17 (A) IN GENERAL.—The Under Secretary 

18 shall operate the Climate Service Program 

19 through a national center, the Climate Service 

20 Office, and a network of regional and local fa21 cilities, including the established regional and 

22 local offices of the National Weather Service, 6 

23 Regional Climate Centers, the offices of the Re24 gional Integrated Sciences and Assessments 

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1 formation System, and any other National Oce2 anic and Atmospheric Administration or Na3 tional Oceanic and Atmospheric Administration4 supported regional and local entities, as appro5 priate. 

6 (B) REGIONAL CLIMATE CENTERS PRO7 GRAM.—The Under Secretary shall maintain a 

8 network of 6 Regional Climate Centers to work 

9 cooperatively with the State Climate Offices 

10 to— 

11 (i) collect and exchange data and in12 formation needed to characterize, under13 stand, and forecast regional and local 

14 weather and climate; 

15 (ii) facilitate collection and exchange 

16 of data and information between the States 

17 and Federal Government on weather and 

18 climate in conjunction with the National 

19 Climatic Data Center; 

20 (iii) support research and observa21 tions; 

22 (iv) obtain input on stakeholder needs 

23 for weather and climate information and 

24 products; and 


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1 (v) support State and local adaptation 

2 and response planning. 

3 (C) REGIONAL INTEGRATED SCIENCES AND

4 ASSESSMENTS PROGRAM.—The Under Secretary 

5 shall maintain a network of offices as part of 

6 the Regional Integrated Sciences and Assess7 ments Program. Such offices shall engage in co8 operative research, development, and dem9 onstration projects with the academic commu10 nity, State Climate Offices, Regional Climate 

11 Offices, and other users and stakeholders on cli12 mate products, technologies, models, and other 

13 tools to improve understanding and forecasting 

14 of regional and local climate variability and 

15 change and the effects on economic activities, 

16 natural resources, and water availability, and 

17 other effects on communities, to facilitate devel18 opment of regional and local adaptation plans 

19 to respond to climate variability and change, 

20 and any other needed research identified by the 

21 Under Secretary or the Advisory Committee. 

22 (D) OTHER OFFICES.—In carrying out the 

23 functions of the Climate Service Program, the 

24 Under Secretary shall utilize the assets and ex25 pertise of— 


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1 (i) the National Weather Service to— 

2 (I) deliver operational weather 

3 and climate forecasts, warnings, prod4 ucts, and information through the Cli5 mate Service Programs Division, 

6 Local Weather Forecast Offices, 

7 Weather Service Offices, and River 

8 Forecast Centers; and 

9 (II) develop climate forecast 

10 models and tools through the National 

11 Centers for Environmental Prediction; 

12 (ii) the National Environmental Sat13 ellite, Data, and Information Service to 

14 provide data services and support for prod15 uct development and operations through 

16 the National Climatic Data Center and the 

17 Regional Climate Centers; 

18 (iii) the Office of Oceanic and Atmos19 pheric Research to— 

20 (I) provide research on product 

21 development; 

22 (II) improve weather and climate 

23 forecast models; 

24 (III) provide new technologies 

25 and methods of observation; and 


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1 (IV) oversee the National Oce2 anic and Atmospheric Administration 

3 supported research performed by the 

4 Joint Cooperative Institutes, univer5 sities, and other non-Federal entities; 

6 (iv) the National Integrated Drought 

7 Information System to— 

8 (I) provide an effective drought 

9 warning system; 

10 (II) coordinate and integrate 

11 Federal research on droughts; 

12 (III) collect and integrate infor13 mation on key indicators of drought; 

14 (IV) make usable, reliable, and 

15 timely forecasts and assessments of 

16 drought, including assessments of the 

17 severity of drought conditions and ef18 fects; 

19 (V) communicate drought fore20 casts, conditions, and effects to Fed21 eral, State, tribal, and local govern22 ments, regional entities, the private 

23 sector, and the public; and 

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1 sess management practices and tech2 nologies, and the effects of both, used 

3 for drought mitigation at the local, 

4 State, and regional levels; and 

5 (v) any other National Oceanic and 

6 Atmospheric Administration offices or pro7 grams, as appropriate. 

8 (E) MISSION.—The Under Secretary shall 

9 ensure that the core functions and missions of 

10 the National Weather Service, the National In11 tegrated Drought Information System, and any 

12 other programs within the National Oceanic 

13 and Atmospheric Administration are not dimin14 ished or neglected by the establishment of the 

15 Climate Service Program or the duties imposed 

16 on such offices or programs under this para17 graph. 

18 (F) PROGRAM ELEMENTS.—The Climate 

19 Service Program shall— 

20 (i) conduct analyses of and studies re21 lating to the effects of weather and climate 

22 on communities, including effects on agri23 cultural production, natural resources, en24 ergy supply and demand, recreation, and 

25 other sectors of the economy; 


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1 (ii) carry out observations, data collec2 tion, and monitoring of atmospheric and 

3 oceanic conditions on a statewide, regional, 

4 national, and global basis; 

5 (iii) provide information and technical 

6 support for Federal, regional, State, tribal, 

7 and local government efforts to assess and 

8 respond to climate variability and change; 

9 (iv) develop systems for the manage10 ment and dissemination of data, informa11 tion, and assessments, including mecha12 nisms for consultation with current and 

13 potential users and other stakeholders; 

14 (v) conduct research to improve fore15 casting, characterization, and under16 standing of weather and climate variability 

17 and change and its effects on communities, 

18 including its effects on agricultural produc19 tion, natural resources, energy supply and 

20 demand, recreation, and other sectors of 

21 the economy; and 

22 (vi) develop tools to facilitate the use 

23 of climate information by local and re24 gional stakeholders. 

25 (f) CLIMATE SERVICE ADVISORY COMMITTEE.— 


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1 (1) IN GENERAL.—The Under Secretary shall 

2 establish a Climate Service Advisory Committee to 

3 provide advice on— 

4 (A) climate service product development; 

5 (B) delivery of services to decisionmakers 

6 and other stakeholders; 

7 (C) infrastructure to support observations 

8 and monitoring; 

9 (D) computation and modeling needs, re10 search needs, and other resources needed to de11 velop, distribute, and ensure the utility of cli12 mate data, products, and services; and 

13 (E) any other topics as may be requested 

14 by the Under Secretary or Congress. 

15 (2) MEMBERS.— 

16 (A) IN GENERAL.—The Advisory Com17 mittee shall be composed of at least 25 mem18 bers appointed by the Under Secretary. Each 

19 member of the Advisory Committee shall be 

20 qualified either— 

21 (i) by education, training, and experi22 ence to evaluate scientific and technical in23 formation on matters referred to the Advi24 sory Committee under this subsection; or 


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1 (ii) to evaluate the utility and need for 

2 climate products by planners, decision3 makers, the private sector, and the public. 

4 (B) TERMS OF SERVICE.—Members shall 

5 be appointed for 3-year terms, renewable once, 

6 and shall serve at the discretion of the Under 

7 Secretary. Vacancy appointments shall be for 

8 the remainder of the unexpired term of the va9 cancy, and an individual so appointed may sub10 sequently be appointed for 2 full 3-year terms 

11 if the remainder of the unexpired term is less 

12 than one year. 

13 (C) CHAIRPERSON.—The Under Secretary 

14 shall designate a chairperson from among the 

15 members of the Advisory Committee. The des16 ignated Chairperson shall alternate between a 

17 member who is appointed as a representative 

18 and a member who is appointed as a Special 

19 Government Employee. 

20 (D) SUBCOMMITTEES.— 

21 (i) ESTABLISHMENT.—The Advisory 

22 Committee shall establish— 

23 (I) a Subcommittee on Science 

24 and Technology to advise the Climate 

25 Service Program on needed research, 


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1 technology development, and addi2 tional observations, and on any other 

3 scientific or technical issues as appro4 priate; and 

5 (II) a Subcommittee on Product 

6 Development and Delivery composed 

7 primarily of representatives of the 

8 community of potential users of the 

9 products developed and delivered by 

10 the Climate Service Program. 

11 The Advisory Committee may establish 

12 such additional subcommittees of its mem13 bers as may be necessary. 

14 (ii) APPOINTMENT.— 

15 (I) FULL ADVISORY COM16 MITTEE.—At least 50 percent of the 

17 members of the Advisory Committee 

18 shall be appointed as Special Govern19 ment Employees. 

20 (II) SUBCOMMITTEES.—At least 

21 75 percent of the members of the 

22 Subcommittee on Science and Tech23 nology shall be appointed as Special 

24 Government Employees. Not more 

25 than 25 percent of the members of 


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1 the Subcommittee on Product Devel2 opment and Delivery shall be ap3 pointed as Special Government Em4 ployees. 

5 (3) ADMINISTRATIVE PROVISIONS.— 

6 (A) REPORTING.—The Advisory Com7 mittee shall report to the Under Secretary and 

8 the appropriate requesting party. 

9 (B) ADMINISTRATIVE SUPPORT.—The 

10 Under Secretary shall provide administrative 

11 support to the Advisory Committee. 

12 (C) MEETINGS.—The Advisory Committee 

13 shall meet at least twice each year and at other 

14 times at the call of the Under Secretary or the 

15 Chairperson. 

16 (D) COMPENSATION AND EXPENSES.—A 

17 member of the Advisory Committee shall not be 

18 compensated for service on the Advisory Com19 mittee, but may be allowed travel expenses, in20 cluding per diem in lieu of subsistence, in ac21 cordance with subchapter I of chapter 57 of 

22 title 5, United States Code. 

23 (4) EXPIRATION.—Section 14 of the Federal 

24 Advisory Committee Act (5 U.S.C. App.) shall not 

25 apply to the Climate Service Advisory Committee. 


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1 (g) REPEAL.—The National Climate Program Act 

2 (15 U.S.C. 2901 et seq.) is repealed. 

3 (h) ESTABLISHMENT OF REGIONAL INTEGRATED

4 SCIENCES AND ASSESSMENTS TEAMS.— 

5 (1) IN GENERAL.—In maintaining the network 

6 of Regional Integrated Sciences and Assessments 

7 (RISA) Teams under subsection (e)(3)(C), the 

8 Under Secretary shall utilize a competitive, peer-re9 viewed selection process. Teams shall conduct ap10 plied regional climate research and projects to ad11 dress the needs of local and regional decisionmakers 

12 for information and tools to develop adaptation and 

13 response plans to climate variability and change. 

14 The awards shall be administered through a cooper15 ative agreement between the National Oceanic and 

16 Atmospheric Administration and the RISA Team. 

17 Each award shall be for a period of five years. 

18 (2) RISA TEAMS.—Teams shall be composed of 

19 multi-institutional partnerships whose individual 

20 members may include— 

21 (A) institutions of higher education, as de22 fined in section 101(a) of the Higher Education 

23 Act of 1965 (20 U.S.C. 1001(a)); 


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1 (B) minority serving institutions, as de2 fined in section 371(a) of the Higher Education 

3 Act of 1965; and 

4 (C) nongovernmental research organiza5 tions, Federal agencies, State and local agen6 cies, tribal organizations, and for-profit entities. 

7 (3) CONSIDERATIONS.—In making awards 

8 under this subsection, the Under Secretary shall 

9 consider— 

10 (A) the overall geographic distribution of 

11 RISA Teams and existing gaps in applied re12 search to support local and regional decision13 makers; 

14 (B) the team’s ability to contribute to the 

15 National Oceanic and Atmospheric Administra16 tion’s efforts to deliver climate services in the 

17 region; and 

18 (C) the team’s proposal to integrate social 

19 and physical sciences research to address the 

20 effects of climate variability and change on the 

21 ecology, economy, infrastructure, and commu22 nities in the region. 

23 (i) SURVEY OF NEED FOR CLIMATE SERVICES.— 

24 (1) IN GENERAL.—The Under Secretary shall 

25 provide a report to Congress within 9 months after 


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1 the date of enactment of this Act that compiles in2 formation on the current climate products being de3 livered by the National Oceanic and Atmospheric 

4 Administration and its partner organizations to 

5 users and stakeholders and on the needs of users 

6 and stakeholders for new climate products and serv7 ices. 

8 (2) CONTENTS OF REPORT.—The report shall 

9 identify— 

10 (A) specific user groups and stakeholders 

11 that currently are served by the National Oce12 anic and Atmospheric Administration and its 

13 partner organizations; 

14 (B) the type of climate products and serv15 ices currently delivered to specific user groups 

16 and stakeholders and the specific National Oce17 anic and Atmospheric Administration office or 

18 partner organization that delivers these prod19 ucts and services; 

20 (C) potential user groups and stakeholders 

21 that may be served by expanding climate prod22 ucts and services; and 

23 (D) specific needs for new climate products 

24 and services identified by user groups and 

25 stakeholders. 


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1 (3) CONSULTATION.—The Under Secretary 

2 shall consult with the Climate Service Advisory Com3 mittee in the preparation of this report. 

4 (j) IMPLEMENTATION PLAN.— 

5 (1) IN GENERAL.—The Under Secretary shall 

6 prepare a plan for creating a Climate Service Pro7 gram in the National Oceanic and Atmospheric Ad8 ministration and delivering climate products and 

9 services to the National Oceanic and Atmospheric 

10 Administration users and stakeholders. The plan 

11 shall be submitted to the President and the Con12 gress within 1 year after the date of enactment of 

13 this Act. 

14 (2) DRAFT PLAN.—Prior to the submission of 

15 the final plan, the Under Secretary shall publish a 

16 draft plan in the Federal Register with a public 

17 comment period of at least 30 days. 

18 (3) CONTENTS.—The plan shall— 

19 (A) identify the current gaps in climate 

20 services and outline the process and resources 

21 the National Oceanic and Atmospheric Admin22 istration will use to fill these gaps; 

23 (B) describe the roles of the National Oce24 anic and Atmospheric Administration line of25 fices and the National Oceanic and Atmospheric 


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1 Administration partner organizations in the de2 velopment and delivery of climate products and 

3 services; 

4 (C) describe the development and imple5 mentation of quality assurance and control 

6 mechanisms for climate products and services 

7 delivered by the National Oceanic and Atmos8 pheric Administration and its partner organiza9 tions; 

10 (D) identify the mechanisms and opportu11 nities for determining user needs and engaging 

12 in a two-way dialogue with users that will in13 form climate product and service development 

14 and delivery of authoritative, timely, and useful 

15 information on climate variability and change 

16 and the effects on local, State, regional, na17 tional, and global scales; 

18 (E) identify new responsibilities or tasks to 

19 be undertaken by existing National Oceanic and 

20 Atmospheric Administration line offices and 

21 partner organizations; 

22 (F) identify new infrastructure, equipment, 

23 personnel, or other resources needed to imple24 ment the proposed plan; and 


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1 (G) include responses to the comments re2 ceived during the public comment period. 

3 (4) CONTINUITY OF SERVICE.—During the de4 velopment of the implementation plan, the public 

5 comment period, and final plan, the National Oce6 anic and Atmospheric Administration shall continue 

7 to provide climate services to the user community. 

8 (5) CONSULTATION.—In developing the plan, 

9 the Under Secretary shall consult with user groups 

10 and stakeholders, State Climate Offices, Regional 

11 Climate Centers, other Federal agencies, the Climate 

12 Service Advisory Committee, and Congress. 

13 (6) COORDINATION WITH INTERAGENCY DEVEL14 OPMENT OF A NATIONAL CLIMATE SERVICE.—In 

15 preparing the plan required under this subsection, 

16 the Under Secretary shall consult with the Director 

17 of the Office of Science and Technology Policy to en18 sure that the program developed by the Agency will 

19 serve the needs of a National Climate Service. 

20 (k) SUMMER INSTITUTES PROGRAM AT THE RE21 GIONAL CLIMATE CENTERS.— 

22 (1) DEFINITIONS.—In this subsection: 

23 (A) SUMMER INSTITUTE.—The term 

24 ‘‘summer institute’’ means an institute, oper25 ated during the summer, that— 


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1 (i) is hosted by a Regional Climate 

2 Center or an eligible partner; 

3 (ii) is operated for a period of not less 

4 than 2 weeks; and 

5 (iii) provides direct interaction of mid6 dle school and high school teacher and un7 dergraduate student participants with per8 sonnel of the Regional Climate Centers or 

9 eligible partners who have scientific exper10 tise in weather and climate. 

11 (B) ELIGIBLE PARTNER.—The term ‘‘eligi12 ble partner’’ means— 

13 (i) the science, engineering, or mathe14 matics department at an institution of 

15 higher education; or 

16 (ii) a nonprofit entity with expertise 

17 in providing educational enrichment experi18 ences for students. 

19 (2) SUMMER INSTITUTES PROGRAM AUTHOR20 IZED.— 

21 (A) IN GENERAL.—The Under Secretary 

22 shall establish a summer institutes program, to 

23 be conducted in cooperation with the Regional 

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1 vide training and professional enrichment by 

2 providing opportunities for interaction between 

3 participants and climate scientists in a research 

4 and operational setting to— 

5 (i) enable middle school and high 

6 school teachers to integrate weather and 

7 climate sciences into their curricula: and 

8 (ii) encourage undergraduate students 

9 to pursue further study and careers in 

10 weather and climate sciences. 

11 (B) REQUIRED ACTIVITIES.—Funds au12 thorized under this subsection shall be used 

13 for— 

14 (i) providing educational opportunities 

15 for middle school and high school teachers 

16 and undergraduate students not achievable 

17 inside the classroom; 

18 (ii) exposing such teachers and stu19 dents to researchers, scientists, or engi20 neers who can demonstrate their daily ac21 tivities to the teachers and students; 

22 (iii) exposing teachers and students to 

23 scientific methods in a research discovery 

24 setting; and 


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1 (iv) assisting teachers with curriculum 

2 development in the areas of weather and 

3 climate science. 

4 (3) PRIORITY.—The Under Secretary shall en5 sure that each summer institute program authorized 

6 under paragraph (2) includes students from groups 

7 underrepresented in the fields of science, technology, 

8 engineering, and mathematics teaching, including 

9 women and members of minority groups. 

10 (4) REPORT TO CONGRESS.—The Under Sec11 retary shall submit to Congress a biennial report on 

12 the activities conducted under this subsection, in13 cluding the number of participants and the new cur14 ricula developed in atmospheric and climate sciences. 

15 (l) CLEARINGHOUSE OF FEDERAL CLIMATE SERVICE

16 PRODUCTS AND LINKS TO FEDERAL AGENCIES PRO17 VIDING CLIMATE SERVICES.— 

18 (1) IN GENERAL.—The Under Secretary shall 

19 establish and maintain a clearinghouse to inform 

20 State, local, and tribal governments and the public 

21 about the information and services available to— 

22 (A) assess the impacts of climate varia23 bility and change at different geographic scales; 


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1 (B) characterize and forecast climate vari2 ability and change for specific regions, re3 sources, and economic sectors; and 

4 (C) develop and implement adaptation 

5 strategies to reduce vulnerabilities to climate 

6 variability and change. 

7 (2) OTHER RESOURCES.—The clearinghouse 

8 shall include hyperlinks to Internet sites that de9 scribe the activities, information, and resources of— 

10 (A) the Federal Government; 

11 (B) State and local governments; 

12 (C) the private sector; 

13 (D) nongovernmental and nonprofit enti14 ties and organizations; and 

15 (E) international organizations. 

16 (m) FINANCIAL BURDEN.—Nothing in this section 

17 shall be construed as authorizing the National Climate 

18 Service or the Climate Service Program at the National 

19 Oceanic and Atmospheric Administration to require State, 

20 tribal, or local governments to develop adaptation or re21 sponse plans or to take any other action in response to 

22 variations in climate that may result in an increased finan23 cial burden to such governments. 


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1 SEC. 453. STATE PROGRAMS TO BUILD RESILIENCE TO CLI2 MATE CHANGE IMPACTS. 

3 (a) DEFINITIONS.—For purposes of this section: 

4 (1) ALLOWANCE.—The term ‘‘allowance’’ 

5 means an emission allowance established under sec6 tion 721 of the Clean Air Act (as added by section 

7 311 of this Act). 

8 (2) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 

9 has the meaning given the term in section 4 of the 

10 Indian Self-Determination and Education Assistance 

11 Act (25 U.S.C. 450b). 

12 (3) VINTAGE YEAR.—The term ‘‘vintage year’’ 

13 has the meaning given that term under section 700 

14 of the Clean Air Act (as added by section 312 of this 

15 Act). 

16 (b) REGULATIONS; COORDINATION.—Not later than 

17 2 years after the date of enactment of this Act, the Admin18 istrator, or such Federal agency head or heads as the 

19 President may designate, shall promulgate regulations to 

20 implement the requirements of this section. If the Presi21 dent designates more than 1 Federal agency to implement 

22 this section, the President shall require such agencies to 

23 establish a memorandum of understanding providing for 

24 coordination of rulemaking and other implementing activi25 ties, in accordance with the requirements of this section. 

26 (c) DISTRIBUTION OF ALLOWANCES.— 


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1 (1) IN GENERAL.—Not later than September 

2 30 of each of calendar years 2011 through 2049, the 

3 Administrator shall distribute, in accordance with 

4 this section, allowances allocated for the following 

5 vintage year pursuant to section 782(l) of the Clean 

6 Air Act (as added by section 321 of this Act). The 

7 Administrator shall reserve 1 percent of such allow8 ances for distribution to Indian tribes in accordance 

9 with subsection (d). The remainder of such allow10 ances shall be distributed ratably among the States 

11 based on the product of— 

12 (A) each State’s population; and 

13 (B) each State’s allocation factor as deter14 mined under paragraph (2). 

15 (2) STATE ALLOCATION FACTORS.— 

16 (A) IN GENERAL.—Except as provided in 

17 subparagraph (B), the allocation factor for a 

18 State shall be the quotient of— 

19 (i) the per capita income of all indi20 viduals in the United States, divided by 

21 (ii) the per capita income of all indi22 viduals in such State. 

23 (B) LIMITATION.—If the allocation factor 

24 for a State as calculated under subparagraph 

25 (A) would exceed 1.2, then the allocation factor 


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1 for such State shall be 1.2. If the allocation fac2 tor for a State as calculated under subpara3 graph (A) would be less than 0.8, then the allo4 cation factor for such State shall be 0.8. 

5 (C) PER CAPITA INCOME.—For purposes 

6 of this paragraph, per capita income shall be— 

7 (i) determined at 2-year intervals; and 

8 (ii) subject to subparagraph (D), 

9 equal to the average of the annual per cap10 ita incomes for the most recent period of 

11 3 consecutive years for which satisfactory 

12 data are available from the Department of 

13 Commerce at the time such determination 

14 is made. 

15 (D) REVENUE DIRECTLY RESULTING FROM

16 A PRESIDENTIALLY DECLARED MAJOR DIS17 ASTER.—For purposes of this paragraph, per 

18 capita income from one or more of the following 

19 sources shall be reduced or excluded if the Sec20 retary of Commerce (in consultation with the 

21 Administrator and the secretaries or adminis22 trators of the departments or agencies involved) 

23 determines that the income accrues to persons 

24 as the result of a Major Disaster (as declared 

25 by the President of the United States) and if 


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1 the Secretary finds that the inclusion of one or 

2 more of these income sources, in whole or in 

3 part, results in a transitory, rather than a sus4 tainable, increase in a State’s per capita income 

5 level relative to the national average: 

6 (i) Property and casualty insurance 

7 (including homeowners and renters insur8 ance). 

9 (ii) The National Flood Insurance 

10 Program of the Federal Emergency Man11 agement Agency. 

12 (iii) The Individual and Family 

13 Grants Program of the Federal Emergency 

14 Management Agency. 

15 (iv) The Disaster Housing Program of 

16 the Federal Emergency Management 

17 Agency. 

18 (v) The Community Development 

19 Block Grant Program of the Department 

20 of Housing and Urban Development. 

21 (vi) The Disaster Unemployment As22 sistance Program of the Department of 

23 Labor. 

24 (vii) Any other source determined ap25 propriate by the Administrator. 


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1 (d) DISTRIBUTION TO INDIAN TRIBES.—The Admin2 istrator, or such Federal agency head or heads as the 

3 President may designate, shall promulgate regulations es4 tablishing a program to distribute allowances on a com5 petitive basis to Indian tribes, in accordance with the re6 quirements of this section. Such allowances shall be used 

7 exclusively in accordance with the requirements of sub8 section (e). Beginning with vintage year 2015, Indian 

9 tribes with a tribal adaptation plan approved pursuant to 

10 subsection (f) shall be given priority in selection of pro11 grams or projects for receipt of emission allowances under 

12 this subsection. 

13 (e) USE OF ALLOWANCES.— 

14 (1) IN GENERAL.—States and Indian tribes 

15 shall use allowances distributed under this section 

16 exclusively for the implementation of projects, pro17 grams, or measures to build resilience to the impacts 

18 of climate change, including— 

19 (A) extreme weather events such as flood20 ing and tropical cyclones; 

21 (B) more frequent heavy precipitation 

22 events; 

23 (C) water scarcity and adverse impacts on 

24 water quality; 

25 (D) stronger and longer heat waves; 


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1 (E) more frequent and severe droughts; 

2 (F) rises in sea level; 

3 (G) ecosystem disruption; 

4 (H) increased air pollution; and 

5 (I) effects on public health. 

6 (2) PRIORITY IN PROJECTS TO REDUCE FLOOD

7 EVENTS.—When implementing any project, program, 

8 or measure supported under this section and de9 signed to reduce flood events, a State or Indian tribe 

10 should consider prioritizing projects that seek to— 

11 (A) mitigate the destructive impacts of cli12 mate-related increases in the duration, fre13 quency, or magnitude of rainfall or runoff, in14 cluding snowmelt runoff, as well as hurricanes; 

15 (B) improve flood protection for densely 

16 populated urban areas; and 

17 (C) mitigate the destructive impact of 

18 ocean-related climate change effects, including 

19 effects on bays, estuaries, populated barrier is20 lands and other ocean-related features, through 

21 a variety of means and measures, including the 

22 construction of jetties, levies, and other coastal 

23 structures in densely populated coastal areas 

24 impacted by climate change. 


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1 (3) STATE AND TRIBAL ADAPTATION PLANS.— 

2 Upon approval of a State or tribal climate adapta3 tion plan under subsection (f), allowances received 

4 by a State under this section shall be used in ac5 cordance with such plan. 

6 (4) SUPPLEMENT, NOT SUPPLANT.—It is the 

7 intent of the Congress that allowances distributed to 

8 carry out this section should be used to supplement, 

9 and not replace, existing sources of funding used to 

10 build resilience to the impacts of climate change 

11 identified in paragraph (1). 

12 (f) STATE AND TRIBAL CLIMATE ADAPTATION

13 PLANS.— 

14 (1) IN GENERAL.—The regulations promulgated 

15 pursuant to subsection (b) shall include require16 ments for submission and approval of State or tribal 

17 climate adaptation plans under this section. Begin18 ning with vintage year 2015, distribution of allow19 ances to a State pursuant to this section shall be 

20 contingent on approval of a State climate adaptation 

21 plan for such State that meets the requirements of 

22 such regulations. Requirements for tribal climate ad23 aptation plans may vary from those of State adapta24 tion plans to the extent necessary to account for the 

25 special circumstances of Indian tribes. 


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1 (2) REQUIREMENTS.—Regulations promulgated 

2 under this section shall require, at minimum, that 

3 State and tribal climate adaptation plans— 

4 (A) assess and prioritize the State’s or In5 dian tribe’s vulnerability to a broad range of 

6 impacts of climate change, based on the best 

7 available science; 

8 (B) include an assessment of potential for 

9 carbon reduction through changes to land man10 agement policies (including enhancement or 

11 protection of forest carbon sinks); 

12 (C) identify and prioritize specific cost-ef13 fective projects, programs, and measures to 

14 build resilience to current and predicted im15 pacts of climate change; 

16 (D) ensure that the State or Indian tribe 

17 fully considers and undertakes, to the maximum 

18 extent practicable, initiatives that— 

19 (i) protect or enhance natural eco20 system functions, including protection, 

21 maintenance, or restoration of natural in22 frastructure such as wetlands, reefs, and 

23 barrier islands to buffer communities from 

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1 water recharge, or floodplain restoration to 

2 improve natural flood control capacity; or 

3 (ii) use non-structural approaches in4 cluding practices that utilize, enhance, or 

5 mimic the natural hydrologic cycle proc6 esses of infiltration, evapotranspiration, 

7 and reuse; 

8 (E) be revised and resubmitted for ap9 proval not less frequently than every 5 years; 

10 and 

11 (F) be consistent with Federal conserva12 tion and environmental laws and, to the max13 imum extent practicable, avoid environmental 

14 degradation. 

15 (3) COORDINATION WITH PRIOR PLANNING EF16 FORTS.—In implementing this subsection, the Ad17 ministrator, or such Federal agency head or heads 

18 as the President may designate, shall— 

19 (A) draw upon lessons learned and best 

20 practices from preexisting State and tribal cli21 mate adaptation planning efforts; 

22 (B) seek to avoid duplication of such ef23 forts; and 

24 (C) ensure that the plans developed under 

25 this section reflect and are fully consistent with 


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1 State natural resources adaptation plans devel2 oped under section 479 of this Act. 

3 (g) REPORTING.—Each State or Indian tribe receiv4 ing allowances under this section shall submit to the Ad5 ministrator, or such Federal agency head or heads as the 

6 President may designate, within 12 months after each re7 ceipt of such allowances and once every 2 years thereafter 

8 until the value of any allowances received under this sec9 tion has been fully expended, a report that— 

10 (1) provides a full accounting for the State’s or 

11 Indian tribe’s use of allowances distributed under 

12 this section, including a description of the projects, 

13 programs, or measures supported using such allow14 ances; 

15 (2) includes a report prepared by an inde16 pendent third party, in accordance with such regula17 tions as are promulgated by the Administrator or 

18 such other Federal agency head or heads as the 

19 President may designate, evaluating the performance 

20 of the projects, programs, or measures supported 

21 under this section; and 

22 (3) identifies any use by the State or Indian 

23 tribe of allowances distributed under this section for 

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1 fects of climate change on water and flood protection 

2 infrastructure. 

3 (h) ENFORCEMENT.—If the Administrator, or such 

4 Federal agency head or heads as the President may des5 ignate, determines that a State or Indian tribe is not in 

6 compliance with this section, the Administrator or such 

7 other agency head may withhold a quantity of the allow8 ances equal to up to twice the quantity of allowances that 

9 the State or Indian tribe failed to use in accordance with 

10 the requirements of this section, that such State or Indian 

11 tribe would otherwise be eligible to receive under this sec12 tion in 1 or more later years. Allowances withheld pursu13 ant to this subsection shall be distributed among the re14 maining States or Indian tribes ratably in accordance with 

15 the formula in subsection (c) in the case of allowances 

16 withheld from a State, or in accordance with subsection 

17 (d) in the case of allowances withheld from an Indian 

18 tribe. 

19 Subpart B—Public Health and Climate Change 

20 SEC. 461. SENSE OF CONGRESS ON PUBLIC HEALTH AND 

21 CLIMATE CHANGE. 

22 It is the sense of the Congress that the Federal Gov23 ernment, in cooperation with international, State, tribal, 

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1 nizations, and citizens, should use all practicable means 

2 and measures— 

3 (1) to assist the efforts of public health and 

4 health care professionals, first responders, States, 

5 tribes, municipalities, and local communities to in6 corporate measures to prepare health systems to re7 spond to the impacts of climate change; 

8 (2) to ensure— 

9 (A) that the Nation’s health professionals 

10 have sufficient information to prepare for and 

11 respond to the adverse health impacts of cli12 mate change; 

13 (B) the utility and value of scientific re14 search in advancing understanding of— 

15 (i) the health impacts of climate 

16 change; and 

17 (ii) strategies to prepare for and re18 spond to the health impacts of climate 

19 change; 

20 (C) the identification of communities vul21 nerable to the health effects of climate change 

22 and the development of strategic response plans 

23 to be carried out by health professionals for 

24 those communities; 


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1 (D) the improvement of health status and 

2 health equity through efforts to prepare for and 

3 respond to climate change; and 

4 (E) the inclusion of health policy in the de5 velopment of climate change responses; 

6 (3) to encourage further research, interdiscipli7 nary partnership, and collaboration among stake8 holders in order to— 

9 (A) understand and monitor the health im10 pacts of climate change; and 

11 (B) improve public health knowledge and 

12 response strategies to climate change; 

13 (4) to enhance preparedness activities, and pub14 lic health infrastructure, relating to climate change 

15 and health; 

16 (5) to encourage each and every American to 

17 learn about the impacts of climate change on health; 

18 and 

19 (6) to assist the efforts of developing nations to 

20 incorporate measures to prepare health systems to 

21 respond to the impacts of climate change. 

22 SEC. 462. RELATIONSHIP TO OTHER LAWS. 

23 Nothing in this subpart in any manner limits the au24 thority provided to or responsibility conferred on any Fed25 eral department or agency by any provision of any law 


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1 (including regulations) or authorizes any violation of any 

2 provision of any law (including regulations), including any 

3 health, energy, environmental, transportation, or any 

4 other law or regulation. 

5 SEC. 463. NATIONAL STRATEGIC ACTION PLAN. 

6 (a) REQUIREMENT.— 

7 (1) IN GENERAL.—The Secretary of Health and 

8 Human Services, within 2 years after the date of the 

9 enactment of this Act, on the basis of the best avail10 able science, and in consultation pursuant to para11 graph (2), shall publish a strategic action plan to as12 sist health professionals in preparing for and re13 sponding to the impacts of climate change on public 

14 health in the United States and other nations, par15 ticularly developing nations. 

16 (2) CONSULTATION.—In developing or making 

17 any revision to the national strategic action plan, the 

18 Secretary shall— 

19 (A) consult with the Director of the Cen20 ters for Disease Control and Prevention, the 

21 Administrator of the Environmental Protection 

22 Agency, the Director of the National Institutes 

23 of Health, the Secretary of Energy, other ap24 propriate Federal agencies, Indian tribes, State 

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1 tions, scientists, and other interested stake2 holders; and 

3 (B) provide opportunity for public input. 

4 (b) CONTENTS.— 

5 (1) IN GENERAL.—The Secretary, acting 

6 through the Director of the Centers for Disease 

7 Control and Prevention and other appropriate Fed8 eral agencies, shall assist health professionals in pre9 paring for and responding effectively and efficiently 

10 to the health effects of climate change through 

11 measures including— 

12 (A) developing, improving, integrating, and 

13 maintaining domestic and international disease 

14 surveillance systems and monitoring capacity to 

15 respond to health-related effects of climate 

16 change, including on topics addressing— 

17 (i) water, food, and vector borne infec18 tious diseases and climate change; 

19 (ii) pulmonary effects, including re20 sponses to aeroallergens; 

21 (iii) cardiovascular effects, including 

22 impacts of temperature extremes; 

23 (iv) air pollution health effects, includ24 ing heightened sensitivity to air pollution; 

25 (v) hazardous algal blooms; 


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1 (vi) mental and behavioral health im2 pacts of climate change; 

3 (vii) the health of refugees, displaced 

4 persons, and vulnerable communities; 

5 (viii) the implications for communities 

6 vulnerable to health effects of climate 

7 change, as well as strategies for responding 

8 to climate change within these commu9 nities; and 

10 (ix) local and community-based health 

11 interventions for climate-related health im12 pacts; 

13 (B) creating tools for predicting and moni14 toring the public health effects of climate 

15 change on the international, national, regional, 

16 State, and local levels, and providing technical 

17 support to assist in their implementation; 

18 (C) developing public health communica19 tions strategies and interventions for extreme 

20 weather events and disaster response situations; 

21 (D) identifying and prioritizing commu22 nities and populations vulnerable to the health 

23 effects of climate change, and determining ac24 tions and communication strategies that should 

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1 nities and populations from the health effects of 

2 climate change; 

3 (E) developing health communication, pub4 lic education, and outreach programs aimed at 

5 public health and health care professionals, as 

6 well as the general public, to promote prepared7 ness and response strategies relating to climate 

8 change and public health, including the identi9 fication of greenhouse gas reduction behaviors 

10 that are health-promoting; and 

11 (F) developing academic and regional cen12 ters of excellence devoted to— 

13 (i) researching relationships between 

14 climate change and health; 

15 (ii) expanding and training the public 

16 health workforce to strengthen the capacity 

17 of such workforce to respond to and pre18 pare for the health effects of climate 

19 change; 

20 (iii) creating and supporting academic 

21 fellowships focusing on the health effects 

22 of climate change; and 

23 (iv) training senior health ministry of24 ficials from developing nations to strength25 en the capacity of such nations to— 


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1 (I) prepare for and respond to 

2 the health effects of climate change; 

3 and 

4 (II) build an international net5 work of public health professionals 

6 with the necessary climate change 

7 knowledge base; 

8 (G) using techniques, including health im9 pact assessments, to assess various climate 

10 change public health preparedness and response 

11 strategies on international, national, State, re12 gional, tribal, and local levels, and make rec13 ommendations as to those strategies that best 

14 protect the public health; 

15 (H)(i) assisting in the development, imple16 mentation, and support of State, regional, trib17 al, and local preparedness, communication, and 

18 response plans (including with respect to the 

19 health departments of such entities) to antici20 pate and reduce the health threats of climate 

21 change; and 

22 (ii) pursuing collaborative efforts to de23 velop, integrate, and implement such plans; 

24 (I) creating a program to advance research 

25 as it relates to the effects of climate change on 


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1 public health across Federal agencies, including 

2 research to— 

3 (i) identify and assess climate change 

4 health effects preparedness and response 

5 strategies; 

6 (ii) prioritize critical public health in7 frastructure projects related to potential 

8 climate change impacts that affect public 

9 health; and 

10 (iii) coordinate preparedness for cli11 mate change health impacts, including the 

12 development of modeling and forecasting 

13 tools; 

14 (J) providing technical assistance for the 

15 development, implementation, and support of 

16 preparedness and response plans to anticipate 

17 and reduce the health threats of climate change 

18 in developing nations; and 

19 (K) carrying out other activities deter20 mined appropriate by the Secretary to plan for 

21 and respond to the impacts of climate change 

22 on public health. 

23 (c) REVISION.—The Secretary shall revise the na24 tional strategic action plan not later than July 1, 2014, 

25 and every 4 years thereafter, to reflect new information 


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1 collected pursuant to implementation of the national stra2 tegic action plan and otherwise, including information 

3 on— 

4 (1) the status of critical environmental health 

5 parameters and related human health impacts; 

6 (2) the impacts of climate change on public 

7 health; and 

8 (3) advances in the development of strategies 

9 for preparing for and responding to the impacts of 

10 climate change on public health. 

11 (d) IMPLEMENTATION.— 

12 (1) IMPLEMENTATION THROUGH HHS.—The 

13 Secretary shall exercise the Secretary’s authority 

14 under this subpart and other provisions of Federal 

15 law to achieve the goals and measures of the na16 tional strategic action plan. 

17 (2) OTHER PUBLIC HEALTH PROGRAMS AND

18 INITIATIVES.—The Secretary and Federal officials of 

19 other relevant Federal agencies shall administer 

20 public health programs and initiatives authorized by 

21 provisions of law other than this subpart, subject to 

22 the requirements of such statutes, in a manner de23 signed to achieve the goals of the national strategic 

24 action plan. 


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1 (3) CDC.—In furtherance of the national stra2 tegic action plan, the Secretary, acting through the 

3 Director of the Centers for Disease Control and Pre4 vention and the head of any other appropriate Fed5 eral agency, shall— 

6 (A) conduct scientific research to assist 

7 health professionals in preparing for and re8 sponding to the impacts of climate change on 

9 public health; and 

10 (B) provide funding for— 

11 (i) research on the health effects of 

12 climate change; and 

13 (ii) preparedness planning on the 

14 international, national, State, tribal, re15 gional, and local levels to respond to or re16 duce the burden of health effects of climate 

17 change; and 

18 (C) carry out other activities determined 

19 appropriate by the Director or the head of such 

20 agency to prepare for and respond to the im21 pacts of climate change on public health. 

22 SEC. 464. ADVISORY BOARD. 

23 (a) ESTABLISHMENT.—The Secretary shall establish 

24 a permanent science advisory board comprised of not less 

25 than 10 and not more than 20 members. 


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1 (b) APPOINTMENT OF MEMBERS.—The Secretary 

2 shall appoint the members of the science advisory board 

3 from among individuals— 

4 (1) who have expertise in public health and 

5 human services, climate change, and other relevant 

6 disciplines; and 

(2) at least 1 7 ⁄2 of whom are recommended by 

8 the President of the National Academy of Sciences. 

9 (c) FUNCTIONS.—The science advisory board shall— 

10 (1) provide scientific and technical advice and 

11 recommendations to the Secretary on the domestic 

12 and international impacts of climate change on pub13 lic health, populations and regions particularly vul14 nerable to the effects of climate change, and strate15 gies and mechanisms to prepare for and respond to 

16 the impacts of climate change on public health; and 

17 (2) advise the Secretary regarding the best 

18 science available for purposes of issuing the national 

19 strategic action plan. 

20 SEC. 465. REPORTS. 

21 (a) NEEDS ASSESSMENT.— 

22 (1) IN GENERAL.—The Secretary shall seek to 

23 enter into, by not later than 6 months after the date 

24 of the enactment of this Act, an agreement with the 


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1 National Research Council and the Institute of Med2 icine to complete a report that— 

3 (A) assesses the needs for health profes4 sionals to prepare for and respond to climate 

5 change impacts on public health; and 

6 (B) recommends programs to meet those 

7 needs. 

8 (2) SUBMISSION.—The agreement under para9 graph (1) shall require the completed report to be 

10 submitted to the Congress and the Secretary and 

11 made publicly available not later than 1 year after 

12 the date of the agreement. 

13 (b) CLIMATE CHANGE HEALTH PROTECTION AND

14 PROMOTION REPORTS.— 

15 (1) IN GENERAL.—The Secretary, in consulta16 tion with the advisory board established under sec17 tion 464, shall ensure the issuance of reports to aid 

18 health professionals in preparing for and responding 

19 to the adverse health effects of climate change 

20 that— 

21 (A) review scientific developments on 

22 health impacts of climate change; and 

23 (B) recommend changes to the national 

24 strategic action plan. 


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1 (2) SUBMISSION.—The Secretary shall submit 

2 the reports required by paragraph (1) to the Con3 gress and make such reports publicly available not 

4 later than July 1, 2013, and every 4 years there5 after. 

6 SEC. 466. DEFINITIONS. 

7 In this subpart: 

8 (1) HEALTH IMPACT ASSESSMENT.—The term 

9 ‘‘health impact assessment’’ means a combination of 

10 procedures, methods, and tools by which a policy, 

11 program, or project may be judged as to its potential 

12 effects on the health of a population, and the dis13 tribution of those effects within the population. 

14 (2) NATIONAL STRATEGIC ACTION PLAN.—The 

15 term ‘‘national strategic action plan’’ means the 

16 plan issued and revised under section 463. 

17 (3) SECRETARY.—Unless otherwise specified, 

18 the term ‘‘Secretary’’ means the Secretary of Health 

19 and Human Services. 

20 SEC. 467. CLIMATE CHANGE HEALTH PROTECTION AND 

21 PROMOTION FUND. 

22 (a) ESTABLISHMENT OF FUND.—There is hereby es23 tablished in the Treasury a separate account that shall 

24 be known as the Climate Change Health Protection and 

25 Promotion Fund. 


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1 (b) AVAILABILITY OF AMOUNTS.—All amounts de2 posited into the Climate Change Health Protection and 

3 Promotion Fund shall be available to the Secretary to 

4 carry out this subpart subject to further appropriation. 

5 (c) DISTRIBUTION OF FUNDS BY HHS.—In carrying 

6 out this subpart, the Secretary may make funds deposited 

7 in the Climate Change Health Protection and Promotion 

8 Fund available to— 

9 (1) other departments, agencies, and offices of 

10 the Federal Government; 

11 (2) foreign, State, tribal, and local govern12 ments; and 

13 (3) such other entities as the Secretary deter14 mines appropriate. 

15 (d) SUPPLEMENT, NOT REPLACE.—It is the intent 

16 of Congress that funds made available to carry out this 

17 subpart should be used to supplement, and not replace, 

18 existing sources of funding for public health. 

19 Subpart C—Natural Resource Adaptation 

20 SEC. 471. PURPOSES. 

21 The purposes of this subpart are to— 

22 (1) establish an integrated Federal program to 

23 protect, restore, and conserve the Nation’s natural 

24 resources in response to the threats of climate 

25 change and ocean acidification; and 


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1 (2) provide financial support and incentives for 

2 programs, strategies, and activities that protect, re3 store, and conserve the Nation’s natural resources in 

4 response to the threats of climate change and ocean 

5 acidification. 

6 SEC. 472. NATURAL RESOURCES CLIMATE CHANGE ADAP7 TATION POLICY. 

8 It is the policy of the Federal Government, in co9 operation with State and local governments, Indian tribes, 

10 and other interested stakeholders to use all practicable 

11 means and measures to protect, restore, and conserve nat12 ural resources to enable them to become more resilient, 

13 adapt to, and withstand the impacts of climate change and 

14 ocean acidification. 

15 SEC. 473. DEFINITIONS. 

16 In this subpart: 

17 (1) COASTAL STATE.—The term ‘‘coastal 

18 State’’ has the meaning given the term in section 

19 304 of the Coastal Zone Management Act of 1972 

20 (16 U.S.C. 1453). 

21 (2) CORRIDORS.—The term ‘‘corridors’’ means 

22 areas that provide connectivity, over different time 

23 scales (including seasonal or longer), of habitat or 

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1 life, or plants to move within a landscape as needed 

2 for migration, gene flow, or dispersal, or in response 

3 to the impacts of climate change and ocean acidifica4 tion or other impacts. 

5 (3) ECOLOGICAL PROCESSES.—The term ‘‘eco6 logical processes’’ means biological, chemical, or 

7 physical interaction between the biotic and abiotic 

8 components of an ecosystem and includes— 

9 (A) nutrient cycling; 

10 (B) pollination; 

11 (C) predator-prey relationships; 

12 (D) soil formation; 

13 (E) gene flow; 

14 (F) disease epizootiology; 

15 (G) larval dispersal and settlement; 

16 (H) hydrological cycling; 

17 (I) decomposition; and 

18 (J) disturbance regimes such as fire and 

19 flooding. 

20 (4) HABITAT.—The term ‘‘habitat’’ means the 

21 physical, chemical, and biological properties that are 

22 used by fish, wildlife, or plants for growth, reproduc23 tion, survival, food, water, and cover, on a tract of 

24 land, in a body of water, or in an area or region. 


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1 (5) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 

2 has the meaning given the term in section 4 of the 

3 Indian Self-Determination and Education Assistance 

4 Act (25 U.S.C. 450b). 

5 (6) NATURAL RESOURCES.—The term ‘‘natural 

6 resources’’ means the terrestrial, freshwater, estua7 rine, and marine fish, wildlife, plants, land, water, 

8 habitats, and ecosystems of the United States. 

9 (7) NATURAL RESOURCES ADAPTATION.—The 

10 term ‘‘natural resources adaptation’’ means the pro11 tection, restoration, and conservation of natural re12 sources to enable them to become more resilient, 

13 adapt to, and withstand the impacts of climate 

14 change and ocean acidification. 

15 (8) RESILIENCE.—Each of the terms ‘‘resil16 ience’’ and ‘‘resilient’’ means the ability to resist or 

17 recover from disturbance and preserve diversity, pro18 ductivity, and sustainability. 

19 (9) STATE.—The term ‘‘State’’ means— 

20 (A) a State of the United States; 

21 (B) the District of Columbia; and 

22 (C) the Commonwealth of Puerto Rico, 

23 Guam, the United States Virgin Islands, the 

24 Northern Mariana Islands, and American 

25 Samoa. 


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1 SEC. 474. COUNCIL ON ENVIRONMENTAL QUALITY. 

2 The Chair of the Council on Environmental Quality 

3 shall— 

4 (1) advise the President on implementation and 

5 development of— 

6 (A) a Natural Resources Climate Change 

7 Adaptation Strategy required under section 

8 476; and 

9 (B) Federal natural resource agency adap10 tation plans required under section 478; 

11 (2) serve as the Chair of the Natural Resources 

12 Climate Change Adaptation Panel established under 

13 section 475; and 

14 (3) coordinate Federal agency strategies, plans, 

15 programs, and activities related to protecting, restor16 ing, and maintaining natural resources to become 

17 more resilient, adapt to, and withstand the impacts 

18 of climate change and ocean acidification. 

19 SEC. 475. NATURAL RESOURCES CLIMATE CHANGE ADAP20 TATION PANEL. 

21 (a) ESTABLISHMENT.—Not later than 90 days after 

22 the date of the enactment of this subpart, the President 

23 shall establish a Natural Resources Climate Change Adap24 tation Panel, consisting of— 

25 (1) the head, or their designee, of each of— 


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1 (A) the National Oceanic and Atmospheric 

2 Administration; 

3 (B) the Forest Service; 

4 (C) the National Park Service; 

5 (D) the United States Fish and Wildlife 

6 Service; 

7 (E) the Bureau of Land Management; 

8 (F) the United States Geological Survey; 

9 (G) the Bureau of Reclamation; 

10 (H) the Bureau of Indian Affairs; 

11 (I) the Environmental Protection Agency; 

12 and 

13 (J) the Army Corps of Engineers; 

14 (2) the Chair of the Council on Environmental 

15 Quality; and 

16 (3) the heads of such other Federal agencies or 

17 departments with jurisdiction over natural resources 

18 of the United States, as determined by the Presi19 dent. 

20 (b) FUNCTIONS.—The Panel shall serve as a forum 

21 for interagency consultation on and the coordination of the 

22 development and implementation of a national Natural 

23 Resources Climate Change Adaptation Strategy required 

24 under section 476. 


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1 (c) CHAIR.—The Chair of the Council on Environ2 mental Quality shall serve as the Chair of the Panel. 

3 SEC. 476. NATURAL RESOURCES CLIMATE CHANGE ADAP4 TATION STRATEGY. 

5 (a) IN GENERAL.—Not later than one year after the 

6 date of the enactment of this subpart, the President, 

7 through the Natural Resources Climate Change Adapta8 tion Panel established under section 475, shall develop a 

9 Natural Resources Climate Change Adaptation Strategy 

10 to protect, restore, and conserve natural resources to en11 able them to become more resilient, adapt to, and with12 stand the impacts of climate change and ocean acidifica13 tion and to identify opportunities to mitigate those im14 pacts. 

15 (b) DEVELOPMENT AND REVISION.—In developing 

16 and revising the Strategy, the Panel shall— 

17 (1) base the strategy on the best available 

18 science; 

19 (2) develop the strategy in close cooperation 

20 with States and Indian tribes; 

21 (3) coordinate with other Federal agencies as 

22 appropriate; 

23 (4) consult with local governments, conservation 

24 organizations, scientists, and other interested stake25 holders; 


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1 (5) provide public notice and opportunity for 

2 comment; and 

3 (6) review and revise the Strategy every 5 years 

4 to incorporate new information regarding the im5 pacts of climate change and ocean acidification on 

6 natural resources and advances in the development 

7 of strategies for becoming more resilient and adapt8 ing to those impacts. 

9 (c) CONTENTS.—The National Resources Adaptation 

10 Strategy shall include— 

11 (1) an assessment of the vulnerability of nat12 ural resources to climate change and ocean acidifica13 tion, including the short-term, medium-term, long14 term, cumulative, and synergistic impacts; 

15 (2) a description of current research, observa16 tion, and monitoring activities at the Federal, State, 

17 tribal, and local level related to the impacts of cli18 mate change and ocean acidification on natural re19 sources, as well as identification of research and 

20 data needs and priorities; 

21 (3) identification of natural resources that are 

22 likely to have the greatest need for protection, res23 toration, and conservation because of the adverse ef24 fects of climate change and ocean acidification; 


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1 (4) specific protocols for integrating climate 

2 change and ocean acidification adaptation strategies 

3 and activities into the conservation and management 

4 of natural resources by Federal departments and 

5 agencies to ensure consistency across agency juris6 dictions and resources; 

7 (5) specific actions that Federal departments 

8 and agencies shall take to protect, conserve, and re9 store natural resources to become more resilient, 

10 adapt to, and withstand the impacts of climate 

11 change and ocean acidification, including a timeline 

12 to implement those actions; 

13 (6) specific mechanisms for ensuring commu14 nication and coordination among Federal depart15 ments and agencies, and between Federal depart16 ments and agencies and State natural resource agen17 cies, United States territories, Indian tribes, private 

18 landowners, conservation organizations, and other 

19 nations that share jurisdiction over natural resources 

20 with the United States; 

21 (7) specific actions to develop and implement 

22 consistent natural resources inventory and moni23 toring protocols through interagency coordination 

24 and collaboration; and 


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1 (8) a process for guiding the development of de2 tailed agency- and department-specific adaptation 

3 plans required under section 478 to address the im4 pacts of climate change and ocean acidification on 

5 the natural resources in the jurisdiction of each 

6 agency. 

7 (d) IMPLEMENTATION.—Consistent with its authori8 ties under other laws and with Federal trust responsibil9 ities with respect to Indian lands, each Federal depart10 ment or agency with representation on the National Re11 sources Climate Change Adaptation Panel shall consider 

12 the impacts of climate change and ocean acidification and 

13 integrate the elements of the strategy into agency plans, 

14 environmental reviews, programs, and activities related to 

15 the conservation, restoration, and management of natural 

16 resources. 

17 SEC. 477. NATURAL RESOURCES ADAPTATION SCIENCE 

18 AND INFORMATION. 

19 (a) COORDINATION.—Not later than 90 days after 

20 the date of the enactment of this subpart, the Secretary 

21 of Commerce, acting through the Administrator of the Na22 tional Oceanic and Atmospheric Administration, and the 

23 Secretary of the Interior, acting through the Director of 

24 the United States Geological Survey, shall establish a co25 ordinated process for developing and providing science and 


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1 information needed to assess and address the impacts of 

2 climate change and ocean acidification on natural re3 sources. The process shall be led by the National Climate 

4 Change and Wildlife Science Center established within the 

5 United States Geological Survey under subsection (d) and 

6 the National Climate Service of the National Oceanic and 

7 Atmospheric Administration. 

8 (b) FUNCTIONS.—The Secretaries shall ensure that 

9 such process avoids duplication and that the National Oce10 anic and Atmospheric Administration and the United 

11 States Geological Survey shall— 

12 (1) provide technical assistance to Federal de13 partments and agencies, State and local govern14 ments, Indian tribes, and interested private land15 owners in their efforts to assess and address the im16 pacts of climate change and ocean acidification on 

17 natural resources; 

18 (2) conduct and sponsor research and provide 

19 Federal departments and agencies, State and local 

20 governments, Indian tribes, and interested private 

21 landowners with research products, decision and 

22 monitoring tools and information, to develop strate23 gies for assisting natural resources to become more 

24 resilient, adapt to, and withstand the impacts of cli25 mate change and ocean acidification; and 


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1 (3) assist Federal departments and agencies in 

2 the development of the adaptation plans required 

3 under section 478. 

4 (c) SURVEY.—Not later than one year after the date 

5 of enactment of this subpart and every 5 years thereafter, 

6 the Secretary of Commerce and the Secretary of the Inte7 rior shall undertake a climate change and ocean acidifica8 tion impact survey that— 

9 (1) identifies natural resources considered likely 

10 to be adversely affected by climate change and ocean 

11 acidification; 

12 (2) includes baseline monitoring and ongoing 

13 trend analysis; 

14 (3) uses a stakeholder process to identify and 

15 prioritize needed monitoring and research that is of 

16 greatest relevance to the ongoing needs of natural 

17 resource managers to address the impacts of climate 

18 change and ocean acidification; and 

19 (4) identifies decision tools necessary to develop 

20 strategies for assisting natural resources to become 

21 more resilient and adapt to and withstand the im22 pacts of climate change and ocean acidification. 

23 (d) NATIONAL CLIMATE CHANGE AND WILDLIFE

24 SCIENCE CENTER.— 


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1 (1) ESTABLISHMENT.—The Secretary of the In2 terior shall establish the National Climate Change 

3 and Wildlife Science Center within the United States 

4 Geological Survey. 

5 (2) FUNCTIONS.—The Center shall, in collabo6 ration with Federal and State natural resources 

7 agencies and departments, Indian tribes, univer8 sities, and other partner organizations— 

9 (A) assess and synthesize current physical 

10 and biological knowledge and prioritize sci11 entific gaps in such knowledge in order to fore12 cast the ecological impacts of climate change on 

13 fish and wildlife at the ecosystem, habitat, com14 munity, population, and species levels; 

15 (B) develop and improve tools to identify, 

16 evaluate, and, where appropriate, link scientific 

17 approaches and models for forecasting the im18 pacts of climate change and adaptation on fish, 

19 wildlife, plants, and their habitats, including 

20 monitoring, predictive models, vulnerability 

21 analyses, risk assessments, and decision support 

22 systems to help managers make informed deci23 sions; 

24 (C) develop and evaluate tools to adapt25 ively manage and monitor the effects of climate 


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1 change on fish and wildlife at national, regional, 

2 and local scales; and 

3 (D) develop capacities for sharing stand4 ardized data and the synthesis of such data. 

5 (e) SCIENCE ADVISORY BOARD.— 

6 (1) ESTABLISHMENT.—Not later than 180 days 

7 after the date of enactment of this subpart, the Sec8 retary of Commerce and the Secretary of the Inte9 rior shall establish and appoint the members of a 

10 Science Advisory Board, to be comprised of not 

11 fewer than 10 and not more than 20 members— 

12 (A) who have expertise in fish, wildlife, 

13 plant, aquatic, and coastal and marine biology, 

14 ecology, climate change, ocean acidification, and 

15 other relevant scientific disciplines; 

16 (B) who represent a balanced membership 

17 among Federal, State, Indian tribes, and local 

18 representatives, universities, and conservation 

19 organizations; and 

(C) at least 1 20 ⁄2 of whom are recommended 

21 by the President of the National Academy of 

22 Sciences. 

23 (2) DUTIES.—The Science Advisory Board 

24 shall— 


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1 (A) advise the Secretaries on the state-of2 the-science regarding the impacts of climate 

3 change and ocean acidification on natural re4 sources and scientific strategies and mecha5 nisms for protecting, restoring, and conserving 

6 natural resources to enable them to become 

7 more resilient, adapt to, and withstand the im8 pacts of climate change and ocean acidification; 

9 and 

10 (B) identify and recommend priorities for 

11 ongoing research needs on such issues. 

12 (3) COLLABORATION.—The Science Advisory 

13 Board shall collaborate with other climate change 

14 and ecosystem research entities in other Federal 

15 agencies and departments. 

16 (4) AVAILABILITY TO THE PUBLIC.—The advice 

17 and recommendations of the Science Advisory Board 

18 shall be made available to the public. 

19 SEC. 478. FEDERAL NATURAL RESOURCE AGENCY ADAPTA20 TION PLANS. 

21 (a) DEVELOPMENT.—Not later than 1 year after the 

22 date of the development of a Natural Resources Climate 

23 Change Adaptation Strategy under section 476, each de24 partment or agency that has a representative on the NatVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 01145 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ural Resources Climate Change Adaptation Panel estab2 lished under section 475 shall— 

3 (1) complete an adaptation plan for that de4 partment or agency, respectively, implementing the 

5 Natural Resources Climate Change Adaptation 

6 Strategy under section 476 and consistent with the 

7 Natural Resources Climate Change Adaptation Pol8 icy under section 472, detailing the department’s or 

9 agency’s current and projected efforts to address the 

10 potential impacts of climate change and ocean acidi11 fication on natural resources within the depart12 ment’s or agency’s jurisdiction and necessary addi13 tional actions, including a timeline for implementa14 tion of those actions; 

15 (2) provide opportunities for review and com16 ment on that adaptation plan by the public, includ17 ing in the case of a plan by the Bureau of Indian 

18 Affairs, review by Indian tribes; and 

19 (3) submit such plan to the President for ap20 proval. 

21 (b) REVIEW BY PRESIDENT AND SUBMISSION TO

22 CONGRESS.— 

23 (1) REVIEW BY PRESIDENT.—The President 

24 shall— 


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1 (A) approve an adaptation plan submitted 

2 under subsection (a)(3) if the plan meets the 

3 requirements of subsection (c) and is consistent 

4 with the strategy developed under section 476; 

5 (B) decide whether to approve the plan 

6 within 60 days after submission; and 

7 (C) if the President disapproves a plan, di8 rect the department or agency to submit a re9 vised plan to the President under subsection 

10 (a)(3) within 60 days after such disapproval. 

11 (2) SUBMISSION TO CONGRESS.—Not later than 

12 30 days after the date of approval of such adapta13 tion plan by the President, the department or agen14 cy shall submit the approved plan to the Committee 

15 on Natural Resources of the House of Representa16 tives, the Committee on Energy and Natural Re17 sources of the Senate, and the committees of the 

18 House of Representatives and the Senate with prin19 cipal jurisdiction over the department or agency. 

20 (c) REQUIREMENTS.—Each adaptation plan shall— 

21 (1) establish programs for assessing the current 

22 and future impacts of climate change and ocean 

23 acidification on natural resources within the depart24 ment’s or agency’s, respectively, jurisdiction, includ25 ing cumulative and synergistic effects, and for idenVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 01147 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tifying and monitoring those natural resources that 

2 are likely to be adversely affected and that have 

3 need for conservation; 

4 (2) identify and prioritize the department’s or 

5 agency’s strategies and specific conservation actions 

6 to address the current and future impacts of climate 

7 change and ocean acidification on natural resources 

8 within the scope of the department’s or agency’s ju9 risdiction and to develop and implement strategies to 

10 protect, restore, and conserve such resources to be11 come more resilient, adapt to, and better withstand 

12 those impacts, including— 

13 (A) the protection, restoration, and con14 servation of terrestrial, marine, estuarine, and 

15 freshwater habitats and ecosystems; 

16 (B) the establishment of terrestrial, ma17 rine, estuarine, and freshwater habitat linkages 

18 and corridors; 

19 (C) the restoration and conservation of ec20 ological processes; 

21 (D) the protection of a broad diversity of 

22 native species of fish, wildlife, and plant popu23 lations across their range; and 

24 (E) the protection of fish, wildlife, and 

25 plant health, recognizing that climate can alter 


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1 the distribution and ecology of parasites, patho2 gens, and vectors; 

3 (3) describe how the department or agency will 

4 integrate such strategies and conservation activities 

5 into plans, programs, activities, and actions of the 

6 department or agency, related to the conservation 

7 and management of natural resources and establish 

8 new plans, programs, activities, and actions as nec9 essary; 

10 (4) establish methods for assessing the effec11 tiveness of strategies and conservation actions taken 

12 to protect, restore, and conserve natural resources to 

13 enable them to become more resilient, adapt to, and 

14 withstand the impacts of climate change and ocean 

15 acidification, and for updating those strategies and 

16 actions to respond to new information and changing 

17 conditions; 

18 (5) include a description of current and pro19 posed mechanisms to enhance cooperation and co20 ordination of natural resources adaptation efforts 

21 with other Federal agencies, State and local govern22 ments, Indian tribes, and nongovernmental stake23 holders; 

24 (6) include specific written guidance to resource 

25 managers to— 


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1 (A) explain how managers are expected to 

2 address the effects of climate change and ocean 

3 acidification; 

4 (B) identify how managers are to obtain 

5 any site-specific information that may be nec6 essary; and 

7 (C) reflect best practices shared among rel8 evant agencies, while also recognizing the 

9 unique missions, objectives, and responsibilities 

10 of each agency; and 

11 (7) identify and assess data and information 

12 gaps necessary to develop natural resources adapta13 tion plans and strategies. 

14 (d) IMPLEMENTATION.— 

15 (1) IN GENERAL.—Upon approval by the Presi16 dent, each department or agency that serves on the 

17 Natural Resources Climate Change Adaptation 

18 Panel shall implement its adaptation plan through 

19 existing and new plans, policies, programs, activities, 

20 and actions to the extent not inconsistent with exist21 ing authority. 

22 (2) CONSIDERATION OF IMPACTS.— 

23 (A) IN GENERAL.—To the maximum ex24 tent practicable and consistent with applicable 

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1 sion made by the department or agency shall 

2 consider the impacts of climate change and 

3 ocean acidification on those natural resources. 

4 (B) GUIDANCE.—The Council on Environ5 mental Quality shall issue guidance for Federal 

6 departments and agencies for considering those 

7 impacts. 

8 (e) REVISION AND REVIEW.—Not less than every 5 

9 years, each adaptation plan under this section shall be re10 viewed and revised to incorporate the best available science 

11 and other information regarding the impacts of climate 

12 change and ocean acidification on natural resources. 

13 SEC. 479. STATE NATURAL RESOURCES ADAPTATION 

14 PLANS. 

15 (a) REQUIREMENT.—In order to be eligible for funds 

16 under section 480, not later than 1 year after the develop17 ment of a Natural Resources Climate Change Adaptation 

18 Strategy required under section 476 each State shall pre19 pare a State natural resources adaptation plan detailing 

20 the State’s current and projected efforts to address the 

21 potential impacts of climate change and ocean acidifica22 tion on natural resources and coastal areas within the 

23 State’s jurisdiction. 

24 (b) REVIEW OR APPROVAL.— 


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1 (1) IN GENERAL.—Each State adaptation plan 

2 shall be reviewed and approved or disapproved by 

3 the Secretary of the Interior and, as applicable, the 

4 Secretary of Commerce. Such approval shall be 

5 granted if the plan meets the requirements of sub6 section (c) and is consistent with the Natural Re7 sources Climate Change Adaptation Strategy re8 quired under section 476. 

9 (2) APPROVAL OR DISAPPROVAL.—Within 180 

10 days after transmittal of such a plan, or a revision 

11 to such a plan, the Secretary of the Interior and, as 

12 applicable, the Secretary of Commerce shall approve 

13 or disapprove the plan by written notice. 

14 (3) RESUBMITTAL.—Within 90 days after 

15 transmittal of a resubmitted adaptation plan as a re16 sult of disapproval under paragraph (3), the Sec17 retary of the Interior and, as applicable, the Sec18 retary of Commerce, shall approve or disapprove the 

19 plan by written notice. 

20 (c) CONTENTS.—A State natural resources adapta21 tion plan shall— 

22 (1) include a strategy for addressing the im23 pacts of climate change and ocean acidification on 

24 terrestrial, marine, estuarine, and freshwater fish, 


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1 wildlife, plants, habitats, ecosystems, wildlife health, 

2 and ecological processes, that— 

3 (A) describes the impacts of climate 

4 change and ocean acidification on the diversity 

5 and health of the fish, wildlife and plant popu6 lations, habitats, ecosystems, and associated ec7 ological processes; 

8 (B) establishes programs for monitoring 

9 the impacts of climate change and ocean acidifi10 cation on fish, wildlife, and plant populations, 

11 habitats, ecosystems, and associated ecological 

12 processes; 

13 (C) describes and prioritizes proposed con14 servation actions to assist fish, wildlife, plant 

15 populations, habitats, ecosystems, and associ16 ated ecological processes in becoming more re17 silient, adapting to, and better withstanding 

18 those impacts; 

19 (D) includes strategies, specific conserva20 tion actions, and a time frame for implementing 

21 conservation actions for fish, wildlife, and plant 

22 populations, habitats, ecosystems, and associ23 ated ecological processes; 

24 (E) establishes methods for assessing the 

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1 tions taken to assist fish, wildlife, and plant 

2 populations, habitats, ecosystems, and associ3 ated ecological processes in becoming more re4 silient, adapt to, and better withstand the im5 pacts of climate changes and ocean acidification 

6 and for updating those strategies and actions to 

7 respond appropriately to new information or 

8 changing conditions; 

9 (F) is incorporated into a revision of the 

10 State wildlife action plan (also known as the 

11 State comprehensive wildlife strategy)— 

12 (i) that has been submitted to the 

13 United States Fish and Wildlife Service; 

14 and 

15 (ii) that has been approved by the 

16 Service or on which a decision on approval 

17 is pending; and 

18 (G) is developed— 

19 (i) with the participation of the State 

20 fish and wildlife agency, the State coastal 

21 agency, the State agency responsible for 

22 administration of Land and Water Con23 servation Fund grants, the State Forest 

24 Legacy program coordinator, and other 


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1 State agencies considered appropriate by 

2 the Governor of such State; and 

3 (ii) in coordination with the Secretary 

4 of the Interior, and where applicable, the 

5 Secretary of Commerce and other States 

6 that share jurisdiction over natural re7 sources with the State; and 

8 (2) include, in the case of a coastal State, a 

9 strategy for addressing the impacts of climate 

10 change and ocean acidification on the coastal zone 

11 that— 

12 (A) identifies natural resources that are 

13 likely to be impacted by climate change and 

14 ocean acidification and describes those impacts; 

15 (B) identifies and prioritizes continuing re16 search and data collection needed to address 

17 those impacts including— 

18 (i) acquisition of high resolution 

19 coastal elevation and nearshore bathymetry 

20 data; 

21 (ii) historic shoreline position maps, 

22 erosion rates, and inventories of shoreline 

23 features and structures; 

24 (iii) measures and models of relative 

25 rates of sea level rise or lake level changes, 


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1 including effects on flooding, storm surge, 

2 inundation, and coastal geological proc3 esses; 

4 (iv) habitat loss, including projected 

5 losses of coastal wetlands and potentials 

6 for inland migration of natural shoreline 

7 habitats; 

8 (v) ocean and coastal species and eco9 system migrations, and changes in species 

10 population dynamics; 

11 (vi) changes in storm frequency, in12 tensity, or rainfall patterns; 

13 (vii) saltwater intrusion into coastal 

14 rivers and aquifers; 

15 (viii) changes in chemical or physical 

16 characteristics of marine and estuarine 

17 systems; 

18 (ix) increased harmful algal blooms; 

19 and 

20 (x) spread of invasive species; 

21 (C) identifies and prioritizes adaptation 

22 strategies to protect, restore, and conserve nat23 ural resources to enable them to become more 

24 resilient, adapt to, and withstand the impacts of 


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1 climate change and ocean acidification, includ2 ing— 

3 (i) protection, maintenance, and res4 toration of ecologically important coastal 

5 lands, coastal and ocean ecosystems, and 

6 species biodiversity and the establishment 

7 of habitat buffer zones, migration cor8 ridors, and climate refugia; and 

9 (ii) improved planning, siting policies, 

10 and hazard mitigation strategies; 

11 (D) establishes programs for the long-term 

12 monitoring of the impacts of climate change 

13 and ocean acidification on the ocean and coastal 

14 zone and to assess and adjust, when necessary, 

15 such adaptive management strategies; 

16 (E) establishes performance measures for 

17 assessing the effectiveness of adaptation strate18 gies intended to improve resilience and the abil19 ity of natural resources in the coastal zone to 

20 adapt to and withstand the impacts of climate 

21 change and ocean acidification and of adapta22 tion strategies intended to minimize those im23 pacts on the coastal zone and to update those 

24 strategies to respond to new information or 

25 changing conditions; and 


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1 (F) is developed with the participation of 

2 the State coastal agency and other appropriate 

3 State agencies and in coordination with the 

4 Secretary of Commerce and other appropriate 

5 Federal agencies. 

6 (d) PUBLIC INPUT.—States shall provide for solicita7 tion and consideration of public and independent scientific 

8 input in the development of their plans. 

9 (e) COORDINATION WITH OTHER PLANS.—The State 

10 plan shall take into consideration research and informa11 tion contained in, and coordinate with and integrate the 

12 goals and measures identified in, as appropriate, other 

13 natural resources conservation strategies, including— 

14 (1) the national fish habitat action plan; 

15 (2) plans under the North American Wetlands 

16 Conservation Act (16 U.S.C. 4401 et seq.); 

17 (3) the Federal, State, and local partnership 

18 known as ‘‘Partners in Flight’’; 

19 (4) federally approved coastal zone management 

20 plans under the Coastal Zone Management Act of 

21 1972 (16 U.S.C. 1451 et seq.); 

22 (5) federally approved regional fishery manage23 ment plants and habitat conservation activities 

24 under the Magnuson-Stevens Fishery Conservation 

25 and Management Act (16 U.S.C. 1801 et seq.); 


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1 (6) the national coral reef action plan; 

2 (7) recovery plans for threatened species and 

3 endangered species under section 4(f) of the Endan4 gered Species Act of 1973 (16 U.S.C. 1533(f)); 

5 (8) habitat conservation plans under section 10 

6 of that Act (16 U.S.C. 1539); 

7 (9) other Federal, State, and tribal plans for 

8 imperiled species; 

9 (10) State or tribal hazard mitigation plans; 

10 (11) State or tribal water management plans; 

11 and 

12 (12) other State-based strategies that com13 prehensively implement adaptation activities to re14 mediate the effects of climate change and ocean 

15 acidification on terrestrial, marine, and freshwater 

16 fish, wildlife, plants, and other natural resources. 

17 (f) UPDATING.—Each State plan shall be updated 

18 not less than every 5 years. 

19 (g) FUNDING.— 

20 (1) IN GENERAL.—Funds allocated to States 

21 under section 480 shall be used only for activities 

22 that are consistent with a State natural resources 

23 adaptation plan that has been approved by the Sec24 retaries of Interior and Commerce. 


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1 (2) FUNDING PRIOR TO THE APPROVAL OF A

2 STATE PLAN.—Until the earlier of the date that is 

3 3 years after the date of the enactment of this sub4 part or the date on which a State receives approval 

5 for the State strategy, a State shall be eligible to re6 ceive funding under section 480 for adaptation ac7 tivities that are— 

8 (A) consistent with the comprehensive 

9 wildlife strategy of the State and, where appro10 priate, other natural resources conservation 

11 strategies; and 

12 (B) in accordance with a workplan devel13 oped in coordination with— 

14 (i) the Secretary of the Interior; and 

15 (ii) the Secretary of Commerce, for 

16 any coastal State subject to the condition 

17 that coordination with the Secretary of 

18 Commerce shall be required only for those 

19 portions of the strategy relating to activi20 ties affecting the coastal zone. 

21 (3) PENDING APPROVAL.—During the period 

22 for which approval by the applicable Secretary of a 

23 State plan is pending, the State may continue receiv24 ing funds under section 480 pursuant to the 

25 workplan described in paragraph (2)(B). 


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1 SEC. 480. NATURAL RESOURCES CLIMATE CHANGE ADAP2 TATION FUND. 

3 (a) ALLOCATIONS TO STATES.—100 percent of the 

4 emission allowances made available for each year to carry 

5 out this subpart shall be provided to States to carry out 

6 natural resources adaptation activities in accordance with 

7 State natural resources adaptation plans approved under 

8 section 479. Specifically— 

9 (1) 84.4 percent shall be available to State 

10 wildlife agencies in accordance with the apportion11 ment formula established under the second sub12 section (c) of section 4 of the Pittman-Robertson 

13 Wildlife Restoration Act (16 U.S.C. 669c), as added 

14 by section 902(e) of H.R. 5548 as introduced in the 

15 106th Congress and enacted into law by section 

16 1(a)(2) of Public Law 106–553 (114 Stat. 2762A– 

17 119); and 

18 (2) 15.6 percent shall be available to State 

19 coastal agencies pursuant to the formula established 

20 by the Secretary of Commerce under section 306(c) 

21 of the Coastal Management Act of 1972 (16 U.S.C. 

22 1455(c)). 

23 (b) ESTABLISHMENT OF FUND.— 

24 (1) ESTABLISHMENT.—There is hereby estab25 lished in the Treasury a separate account that shall 


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1 be known as the Natural Resources Climate Change 

2 Adaptation Fund. 

3 (2) AUTHORIZATION OF APPROPRIATIONS.— 

4 There are authorized to be appropriated for sub5 section (c) such sums as are deposited in the Nat6 ural Resources Climate Change Fund, and the 

7 amounts appropriated for subsection (c) shall be no 

8 less than the total estimated annual deposits in the 

9 Natural Resources Climate Change Adaptation 

10 Fund. Such appropriations shall be offset by the 

11 amounts deposited in such fund pursuant to section 

12 782(m) of the Clean Air Act. 

13 (c) ALLOCATIONS TO FEDERAL AGENCIES.— 

14 (1) DEPARTMENT OF THE INTERIOR.—Of the 

15 amounts made available for each fiscal year to carry 

16 out this subpart— 

17 (A) 27.6 percent shall be allocated to the 

18 Secretary of the Interior for use in funding— 

19 (i) natural resources adaptation activi20 ties carried out— 

21 (I) under endangered species, mi22 gratory species, and other fish and 

23 wildlife programs administered by the 

24 National Park Service, the United 

25 States Fish and Wildlife Service, the 


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1 Bureau of Indian Affairs, and the Bu2 reau of Land Management; 

3 (II) on wildlife refuges, National 

4 Park Service land, and other public 

5 land under the jurisdiction of the 

6 United States Fish and Wildlife Serv7 ice, the Bureau of Land Management, 

8 the Bureau of Indian Affairs, or the 

9 National Park Service; or 

10 (III) within Federal water man11 aged by the Bureau of Reclamation 

12 and the National Park Service; and 

13 (ii) for the implementation of the Na14 tional Fish and Wildlife Habitat and Cor15 ridors Identification Program pursuant to 

16 section 481; 

17 (B) 8.1 percent shall be allocated to the 

18 Secretary of the Interior for natural resources 

19 adaptation activities carried out under coopera20 tive grant programs, including— 

21 (i) the cooperative endangered species 

22 conservation fund authorized under section 

23 6 of the Endangered Species Act of 1973 

24 (16 U.S.C. 1535); 


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1 (ii) programs under the North Amer2 ican Wetlands Conservation Act (16 

3 U.S.C. 4401 et seq.); 

4 (iii) the Neotropical Migratory Bird 

5 Conservation Fund established by section 

6 478(a) of the Neotropical Migratory Bird 

7 Conservation Act (16 U.S.C. 6108(a)); 

8 (iv) the Coastal Program of the 

9 United States Fish and Wildlife Service; 

10 (v) the National Fish Habitat Action 

11 Plan; 

12 (vi) the Partners for Fish and Wildlife 

13 Program; 

14 (vii) the Landowner Incentive Pro15 gram; 

16 (viii) the Wildlife Without Borders 

17 Program of the United States Fish and 

18 Wildlife Service; and 

19 (ix) the Migratory Species Program 

20 and Park Flight Migratory Bird Program 

21 of the National Park Service; and 

22 (C) 4.9 percent shall be allocated to the 

23 Secretary of the Interior to provide financial as24 sistance to Indian tribes to carry out natural 

25 resources adaptation activities through the 


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1 Tribal Wildlife Grants Program of the United 

2 States Fish and Wildlife Service. 

3 (2) LAND AND WATER CONSERVATION FUND.— 

4 (A) DEPOSITS.— 

5 (i) IN GENERAL.—Of the amounts 

6 made available for each fiscal year to carry 

7 out this subpart, 19.5 percent shall be de8 posited into the Land and Water Conserva9 tion Fund established under section 2 of 

10 the Land and Water Conservation Fund 

11 Act of 1965 (16 U.S.C. 460l–5). 

12 (ii) USE OF DEPOSITS.— (I) Deposits 

13 into the Land and Water Conservation 

14 Fund under this paragraph shall be sup15 plemental to authorizations provided under 

16 section 3 of the Land and Water Conserva17 tion Fund Act of 1965 (16 U.S.C. 460l–6), 

18 which shall remain available for non19 adaptation needs. 

20 (II) There are authorized to be appro21 priated for activities in this subpart such 

22 sums as are deposited in the Land and 

23 Water Conservation Fund pursuant to sec24 tion 480(c)(3)(A)(ii), and the amounts ap25 propriated for this paragraph shall be no 


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1 less than the total estimated annual depos2 its in the Land and Water Conservation 

3 Fund. Such appropriations shall be offset 

4 by the amounts deposited in such Fund 

5 pursuant to section 782(m). 

6 (B) ALLOCATIONS.—Of the amounts de7 posited under this paragraph into the Land and 

8 Water Conservation Fund— 

(i) 1 9 ⁄6 shall be allocated to the Sec10 retary of the Interior and made available 

11 on a competitive basis to carry out natural 

12 resources adaptation activities through the 

13 acquisition of land and interests in land 

14 under section 6 of the Land and Water 

15 Conservation Fund Act of 1965 (16 U.S.C. 

16 460l–8)— 

17 (I) to States in accordance with 

18 their natural resources adaptation 

19 plans, and to Indian tribes; 

20 (II) notwithstanding section 5 of 

21 that Act (16 U.S.C. 460l–7); and 

22 (III) in addition to any funds 

23 provided pursuant to annual appro24 priations Acts, the Energy Policy Act 

25 of 2005 (42 U.S.C. 15801 et seq.), or 


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1 any other authorization for non2 adaptation needs; 

(ii) 1 3 ⁄3 shall be allocated to the Sec4 retary of the Interior to carry out natural 

5 resources adaptation activities through the 

6 acquisition of lands and interests in land 

7 under section 7 of the Land and Water 

8 Conservation Fund Act of 1965 (16 U.S.C. 

9 460l–9); 

(iii) 1 10 ⁄6 shall be allocated to the Sec11 retary of Agriculture and made available to 

12 the States and Indian tribes to carry out 

13 natural resources adaptation activities 

14 through the acquisition of land and inter15 ests in land under section 7 of the Forest 

16 Legacy Program under the Cooperative 

17 Forestry Assistance Act of 1978 (16 

18 U.S.C. 2103c); and 

(iv) 1 19 ⁄3 shall be allocated to the Sec20 retary of Agriculture to carry out natural 

21 resources adaptation activities through the 

22 acquisition of land and interests in land 

23 under section 7 of the Land and Water 

24 Conservation Fund Act of 1965 (16 U.S.C. 

25 460l–9). 


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1 (C) EXPENDITURE OF FUNDS.—In allo2 cating funds under subparagraph (B), the Sec3 retary of the Interior and the Secretary of Agri4 culture shall take into consideration factors in5 cluding— 

6 (i) the availability of non-Federal con7 tributions from State, local, or private 

8 sources; 

9 (ii) opportunities to protect fish and 

10 wildlife corridors or otherwise to link or 

11 consolidate fragmented habitats; 

12 (iii) opportunities to reduce the risk of 

13 catastrophic wildfires, drought, extreme 

14 flooding, or other climate-related events 

15 that are harmful to fish and wildlife and 

16 people; and 

17 (iv) the potential for conservation of 

18 species or habitat types at serious risk due 

19 to climate change, ocean acidification, and 

20 other stressors. 

21 (3) FOREST SERVICE.—Of the amounts made 

22 available for each fiscal year to carry out this sub23 part, 8.1 percent shall be allocated to the Secretary 

24 of Agriculture for use in funding natural resources 

25 adaptation activities carried out on national forests 


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1 and national grasslands under the jurisdiction of the 

2 Forest Service. 

3 (4) DEPARTMENT OF COMMERCE.—Of the 

4 amounts made available for each fiscal year to carry 

5 out this subpart, 11.5 percent shall be allocated to 

6 the Secretary of Commerce for use in funding nat7 ural resources adaptation activities to protect, main8 tain, and restore coastal, estuarine, and marine re9 sources, habitats, and ecosystems, including such ac10 tivities carried out under— 

11 (A) the coastal and estuarine land con12 servation program; 

13 (B) the community-based restoration pro14 gram; 

15 (C) the Coastal Zone Management Act of 

16 1972 (16 U.S.C. 1451 et seq.), that are specifi17 cally designed to strengthen the ability of coast18 al, estuarine, and marine resources, habitats, 

19 and ecosystems to adapt to and withstand the 

20 impacts of climate change and ocean acidifica21 tion; 

22 (D) the Open Rivers Initiative; 

23 (E) the Magnuson-Stevens Fishery Con24 servation and Management Act (16 U.S.C. 

25 1801 et seq.); 


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1 (F) the Marine Mammal Protection Act of 

2 1972 (16 U.S.C. 1361 et seq.); 

3 (G) the Endangered Species Act of 1973 

4 (16 U.S.C. 1531 et seq.); 

5 (H) the Marine Protection, Research, and 

6 Sanctuaries Act of 1972 (33 U.S.C. 1401 et 

7 seq.); 

8 (I) the Coral Reef Conservation Act of 

9 2000 (16 U.S.C. 6401 et seq.); and 

10 (J) the Estuary Restoration Act of 2000 

11 (33 U.S.C. 2901 et seq.). 

12 (5) ENVIRONMENTAL PROTECTION AGENCY.— 

13 Of the amounts made available each fiscal year to 

14 carry out this section, 12.2 percent shall be allocated 

15 to the Administrator for use in natural resources ad16 aptation activities restoring and protecting— 

17 (A) large-scale freshwater aquatic eco18 systems, such as the Everglades, the Great 

19 Lakes, Flathead Lake, the Missouri River, the 

20 Mississippi River, the Colorado River, the Sac21 ramento-San Joaquin Rivers, the Ohio River, 

22 the Columbia-Snake River System, the Apa23 lachicola, Chattahoochee, and Flint River Sys24 tem, the Connecticut River, and the Yellowstone 

25 River; 


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1 (B) large-scale estuarine ecosystems, such 

2 as Chesapeake Bay, Long Island Sound, Puget 

3 Sound, the Mississippi River Delta, the San 

4 Francisco Bay Delta, Narragansett Bay, and 

5 Albemarle-Pamlico Sound; and 

6 (C) freshwater and estuarine ecosystems, 

7 watersheds, and basins identified as priorities 

8 by the Administrator, working in cooperation 

9 with other Federal agencies, States, Indian 

10 tribes, local governments, scientists, and other 

11 conservation partners. 

12 (6) CORPS OF ENGINEERS.—Of the amounts 

13 made available each fiscal year to carry out this sec14 tion, 8.1 percent shall be available to the Secretary 

15 of the Army for use by the Corps of Engineers to 

16 carry out natural resources adaptation activities re17 storing— 

18 (A) large-scale freshwater aquatic eco19 systems, such as the ecosystems described in 

20 paragraph (5)(A); 

21 (B) large-scale estuarine ecosystems, such 

22 as the ecosystems described in paragraph 

23 (5)(B); 

24 (C) freshwater and estuarine ecosystems, 

25 watersheds, and basins identified as priorities 


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1 by the Corps of Engineers, working in coopera2 tion with other Federal agencies, States, Indian 

3 tribes, local governments, scientists, and other 

4 conservation partners; and 

5 (D) habitats and ecosystems through the 

6 implementation of estuary habitat restoration 

7 projects authorized by the Estuary Restoration 

8 Act of 2000 (33 U.S.C. 2901 et seq.), project 

9 modifications for improvement of the environ10 ment, aquatic restoration and protection 

11 projects authorized by section 206 of the Water 

12 Resources Development Act of 1996 (33 U.S.C. 

13 2330), and other appropriate programs and ac14 tivities. 

15 (d) USE OF FUNDS BY FEDERAL DEPARTMENTS AND

16 AGENCIES.—Funds allocated to Federal departments and 

17 agencies under this section shall only be used for natural 

18 resources adaptation activities that are consistent with an 

19 adaptation plan developed and approved by the President 

20 under section 478. 

21 (e) STATE COST SHARING.—Notwithstanding any 

22 other provision of law, a State that receives a grant with 

23 amounts allocated under this section shall use funds from 

24 non-Federal sources to pay at least 10 percent of the costs 


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1 of each activity carried out using amounts provided under 

2 the grant. 

3 SEC. 481. NATIONAL WILDLIFE HABITAT AND CORRIDORS 

4 INFORMATION PROGRAM. 

5 (a) ESTABLISHMENT.—Within 6 months of the date 

6 of enactment of this subpart, the Secretary of the Interior, 

7 in cooperation with the States and Indian tribes, shall es8 tablish a National Fish and Wildlife Habitat and Cor9 ridors Information Program in accordance with the re10 quirements of this section. 

11 (b) PURPOSE.—The purpose of this program is to— 

12 (1) support States and Indian tribes in the de13 velopment of a geographic information system data14 base of fish and wildlife habitat and corridors that 

15 would inform planning and development decisions 

16 within each State and Indian tribe, enable each 

17 State and Indian tribe to model climate impacts and 

18 adaptation, and provide geographically specific en19 hancements of State and tribal wildlife action plans; 

20 (2) ensure the collaborative development, with 

21 the States and Indian tribes, of a comprehensive, 

22 national geographic information system database of 

23 maps, models, data, surveys, informational products, 

24 and other geospatial information regarding fish and 

25 wildlife habitat and corridors, that— 


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1 (A) is based on consistent protocols for 

2 sampling and mapping across landscapes that 

3 take into account regional differences; and 

4 (B) that utilizes— 

5 (i) existing and planned State- and 

6 tribal-based geographic information system 

7 databases; and 

8 (ii) existing databases, analytical 

9 tools, metadata activities, and other infor10 mation products available through the Na11 tional Biological Information Infrastruc12 ture maintained by the Secretary and non13 governmental organizations; and 

14 (3) facilitate the use of such databases by Fed15 eral, State, local, and tribal decisionmakers to incor16 porate qualitative information on fish and wildlife 

17 habitat and corridors at the earliest possible stage 

18 to— 

19 (A) prioritize and target natural resources 

20 adaptation strategies and activities; 

21 (B) avoid, minimize, and mitigate the im22 pacts on fish and wildlife habitat and corridors 

23 in siting energy development, water, trans24 mission, transportation, and other land use 

25 projects; 


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1 (C) assess the impacts of existing develop2 ment on habitats and corridors; and 

3 (D) develop management strategies to en4 hance the ability of fish, wildlife, and plant spe5 cies to migrate or respond to shifting habitats 

6 within existing habitats and corridors. 

7 (c) HABITAT AND CORRIDORS INFORMATION SYS8 TEM.— 

9 (1) IN GENERAL.—The Secretary, in coopera10 tion with the States and Indian tribes, shall develop 

11 a Habitat and Corridors Information System. 

12 (2) CONTENTS.—The System shall— 

13 (A) include maps, data, and descriptions of 

14 fish and wildlife habitat and corridors, that— 

15 (i) have been developed by Federal 

16 agencies, State wildlife agencies and nat17 ural heritage programs, Indian tribes, local 

18 governments, nongovernmental organiza19 tions, and industry; 

20 (ii) meet accepted Geospatial Inter21 operability Framework data and metadata 

22 protocols and standards; 

23 (B) include maps and descriptions of pro24 jected shifts in habitats and corridors of fish 


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1 and wildlife species in response to climate 

2 change; 

3 (C) assure data quality and make the data, 

4 models, and analyses included in the System 

5 available at scales useful to decisionmakers— 

6 (i) to prioritize and target natural re7 sources adaptation strategies and activi8 ties; 

9 (ii) to assess the impacts of proposed 

10 energy development, water, transmission, 

11 transportation, and other land use projects 

12 and avoid, minimize, and mitigate those 

13 impacts on habitats and corridors; 

14 (iii) to assess the impacts of existing 

15 development on habitats and corridors; and 

16 (iv) to develop management strategies 

17 to enhance the ability of fish, wildlife, and 

18 plant species to migrate or respond to 

19 shifting habitats within existing habitats 

20 and corridors; 

21 (D) establish a process for updating maps 

22 and other information as landscapes, habitats, 

23 corridors, and wildlife populations change or as 

24 other information becomes available; 


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1 (E) encourage the development of collabo2 rative plans by Federal and State agencies and 

3 Indian tribes to monitor and evaluate the effi4 cacy of the System to meet the needs of deci5 sionmakers; 

6 (F) identify gaps in habitat and corridor 

7 information, mapping, and research that should 

8 be addressed to fully understand and assess 

9 current data and metadata, and to prioritize re10 search and future data collection activities for 

11 use in updating the System and provide support 

12 for those activities; 

13 (G) include mechanisms to support collabo14 rative research, mapping, and planning of habi15 tats and corridors by Federal and State agen16 cies, Indian tribes, and other interested stake17 holders; 

18 (H) incorporate biological and geospatial 

19 data on species and corridors found in energy 

20 development and transmission plans, including 

21 renewable energy initiatives, transportation, and 

22 other land use plans; 

23 (I) be based on the best scientific informa24 tion available; and 


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1 (J) identify, prioritize, and describe key 

2 parcels of non-Federal land located within the 

3 boundaries of units of the National Park Sys4 tem, National Wildlife Refuge System, National 

5 Forest System, or National Grassland System 

6 that are critical to maintenance of wildlife habi7 tat and migration corridors. 

8 (d) FINANCIAL AND OTHER SUPPORT.—The Sec9 retary may provide support to the States and Indian 

10 tribes, including financial and technical assistance, for ac11 tivities that support the development and implementation 

12 of the System. 

13 (e) COORDINATION.—The Secretary, in cooperation 

14 with the States and Indian tribes, shall make rec15 ommendations on how the information developed in the 

16 System may be incorporated into existing relevant State 

17 and Federal plans affecting fish and wildlife, including 

18 land management plans, the State Comprehensive Wildlife 

19 Conservation Strategies, and appropriate tribal conserva20 tion plans, to ensure that they— 

21 (1) prevent unnecessary habitat fragmentation 

22 and disruption of corridors; 

23 (2) promote the landscape connectivity nec24 essary to allow wildlife to move as necessary to meet 


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1 biological needs, adjust to shifts in habitat, and 

2 adapt to climate change; and 

3 (3) minimize the impacts of energy, develop4 ment, water, transportation, and transmission 

5 projects and other activities expected to impact habi6 tat and corridors. 

7 (f) DEFINITIONS.—In this section: 

8 (1) GEOSPATIAL INTEROPERABILITY FRAME9 WORK.—The term ‘‘Geospatial Interoperability 

10 Framework’’ means the strategy utilized by the Na11 tional Biological Information Infrastructure that is 

12 based upon accepted standards, specifications, and 

13 protocols adopted through the International Stand14 ards Organization, the Open Geospatial Consortium, 

15 and the Federal Geographic Data Committee, to 

16 manage, archive, integrate, analyze, and make acces17 sible geospatial and biological data and metadata. 

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

19 the Secretary of the Interior. 

20 SEC. 482. ADDITIONAL PROVISIONS REGARDING INDIAN 

21 TRIBES. 

22 (a) FEDERAL TRUST RESPONSIBILITY.—Nothing in 

23 this subpart is intended to amend, alter, or give priority 

24 over the Federal trust responsibility to Indian tribes. 


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1 (b) EXEMPTION FROM FOIA.—Information received 

2 by a Federal agency pursuant to this Act relating to the 

3 location, character, or ownership of human remains of a 

4 person of Indian ancestry; or resources, cultural items, 

5 uses, or activities identified by an Indian tribe as tradi6 tional or cultural because of the long-established signifi7 cance or ceremonial nature to the Indian tribe; shall not 

8 be subject to disclosure under section 552 of title 5, 

9 United States Code, if the head of the agency, in consulta10 tion with the Secretary of the Interior and an affected In11 dian tribe, determines that disclosure may— 

12 (1) cause a significant invasion of privacy; 

13 (2) risk harm to the human remains or re14 sources, cultural items, uses, or activities; or 

15 (3) impede the use of a traditional religious site 

16 by practitioners. 

17 (c) APPLICATION OF OTHER LAW.—The Secretary of 

18 the Interior may apply the provisions of Public Law 93– 

19 638 where appropriate in the implementation of this sub20 part. 

21 PART 2—INTERNATIONAL CLIMATE CHANGE 

22 ADAPTATION PROGRAM 

23 SEC. 491. FINDINGS AND PURPOSES. 

24 (a) FINDINGS.—Congress finds the following: 


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1 (1) Global climate change is a potentially sig2 nificant national and global security threat multi3 plier and is likely to exacerbate competition and con4 flict over agricultural, vegetative, marine, and water 

5 resources and to result in increased displacement of 

6 people, poverty, and hunger within developing coun7 tries. 

8 (2) The strategic, social, political, economic, 

9 cultural, and environmental consequences of global 

10 climate change are likely to have disproportionate 

11 adverse impacts on developing countries, which have 

12 less economic capacity to respond to such impacts. 

13 (3) The countries most vulnerable to climate 

14 change, due both to greater exposure to harmful im15 pacts and to lower capacity to adapt, are developing 

16 countries with very low industrial greenhouse gas 

17 emissions that have contributed less to climate 

18 change than more affluent countries. 

19 (4) To a much greater degree than developed 

20 countries, developing countries rely on the natural 

21 and environmental systems likely to be affected by 

22 climate change for sustenance, livelihoods, and eco23 nomic growth and stability. 

24 (5) Within developing countries there may be 

25 varying climate change adaptation and resilience 


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1 needs among different communities and populations, 

2 including impoverished communities, children, 

3 women, and indigenous peoples. 

4 (6) The consequences of global climate change, 

5 including increases in poverty and destabilization of 

6 economies and societies, are likely to pose long-term 

7 challenges to the national security, foreign policy, 

8 and economic interests of the United States. 

9 (7) It is in the national security, foreign policy, 

10 and economic interests of the United States to rec11 ognize, plan for, and mitigate the international stra12 tegic, social, political, cultural, environmental, 

13 health, and economic effects of climate change and 

14 to assist developing countries to increase their resil15 ience to those effects. 

16 (8) Under Article 4 of the United Nations 

17 Framework Convention on Climate Change, devel18 oped country parties, including the United States, 

19 committed to ‘‘assist the developing country parties 

20 that are particularly vulnerable to the adverse effects 

21 of climate change in meeting costs of adaptation to 

22 those adverse effects’’. 

23 (9) Under the Bali Action Plan, developed 

24 country parties to the United Nations Framework 

25 Convention on Climate Change, including the United 


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1 States, committed to ‘‘enhanced action on the provi2 sion of financial resources and investment to support 

3 action on mitigation and adaptation and technology 

4 cooperation,’’ including, inter alia, consideration of 

5 ‘‘improved access to adequate, predictable, and sus6 tainable financial resources and financial and tech7 nical support, and the provision of new and addi8 tional resources, including official and concessional 

9 funding for developing country parties’’. 

10 (b) PURPOSES.—The purposes of this part are— 

11 (1) to provide new and additional assistance 

12 from the United States to the most vulnerable devel13 oping countries, including the most vulnerable com14 munities and populations therein, in order to sup15 port the development and implementation of climate 

16 change adaptation programs and activities that re17 duce the vulnerability and increase the resilience of 

18 communities to climate change impacts, including 

19 impacts on water availability, agricultural produc20 tivity, flood risk, coastal resources, timing of sea21 sons, biodiversity, economic livelihoods, health and 

22 diseases, and human migration; and 

23 (2) to provide such assistance in a manner that 

24 protects and promotes the national security, foreign 

25 policy, environmental, and economic interests of the 


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1 United States to the extent such interests may be 

2 advanced by minimizing, averting, or increasing re3 silience to climate change impacts. 

4 SEC. 492. DEFINITIONS. 

5 In this part: 

6 (1) ALLOWANCE.—The term ‘‘allowance’’ 

7 means an emission allowance established under sec8 tion 721 of the Clean Air Act. 

9 (2) APPROPRIATE CONGRESSIONAL COMMIT10 TEES.—The term ‘‘appropriate congressional com11 mittees’’ means— 

12 (A) the Committees on Energy and Com13 merce, Financial Services, and Foreign Affairs 

14 of the House of Representatives; and 

15 (B) the Committees on Environment and 

16 Public Works and Foreign Relations of the Sen17 ate. 

18 (3) DEVELOPING COUNTRY.—The term ‘‘devel19 oping country’’ means a country eligible to receive 

20 official development assistance according to the in21 come guidelines of the Development Assistance Com22 mittee of the Organization for Economic Coopera23 tion and Development. 

24 (4) MOST VULNERABLE DEVELOPING COUN25 TRIES.—The term ‘‘most vulnerable developing 


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1 countries’’ means, as determined by the Adminis2 trator of USAID, developing countries that are at 

3 risk of substantial adverse impacts of climate change 

4 and have limited capacity to respond to such im5 pacts, considering the approaches included in any 

6 international treaties and agreements. 

7 (5) MOST VULNERABLE COMMUNITIES AND

8 POPULATIONS.—The term ‘‘most vulnerable commu9 nities and populations’’ means communities and pop10 ulations that are at risk of substantial adverse im11 pacts of climate change and have limited capacity to 

12 respond to such impacts, including impoverished 

13 communities, children, women, and indigenous peo14 ples. 

15 (6) PROGRAM.—The term ‘‘Program’’ means 

16 the International Climate Change Adaptation Pro17 gram established under section 493. 

18 (7) USAID.—The term ‘‘USAID’’ means the 

19 United States Agency for International Develop20 ment. 

21 (8) UNITED NATIONS FRAMEWORK CONVEN22 TION ON CLIMATE CHANGE.—The term ‘‘United Na23 tions Framework Convention on Climate Change’’ or 

24 ‘‘Convention’’ means the United Nations Framework 

25 Convention on Climate Change done at New York on 


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1 May 9, 1992, and entered into force on March 21, 

2 1994. 

3 SEC. 493. INTERNATIONAL CLIMATE CHANGE ADAPTATION 

4 PROGRAM. 

5 (a) ESTABLISHMENT.—The Secretary of State, in 

6 consultation with the Administrator of USAID, the Sec7 retary of the Treasury, and the Administrator of the Envi8 ronmental Protection Agency, shall establish an Inter9 national Climate Change Adaptation Program in accord10 ance with the requirements of this part. 

11 (b) ALLOWANCE ACCOUNT.—Allowances allocated 

12 pursuant to section 782(n) of the Clean Air Act shall be 

13 available for distribution to carry out the Program estab14 lished under subsection (a). 

15 (c) SUPPLEMENT NOT SUPPLANT.—Assistance pro16 vided under this part shall be used to supplement, and 

17 not to supplant, any other Federal, State, or local re18 sources available to carry out activities of the type carried 

19 out under the Program. 

20 SEC. 494. DISTRIBUTION OF ALLOWANCES. 

21 (a) IN GENERAL.—The Secretary of State, or such 

22 other Federal agency head as the President may des23 ignate, after consultation with the Secretary of the Treas24 ury, the Administrator of USAID, and the Administrator 


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1 of the Environmental Protection Agency, shall direct the 

2 distribution of allowances to carry out the Program— 

3 (1) in the form of bilateral assistance pursuant 

4 to the requirements under section 495; 

5 (2) to multilateral funds or international insti6 tutions pursuant to the Convention or an agreement 

7 negotiated under the Convention; or 

8 (3) through a combination of the mechanisms 

9 identified under paragraphs (1) and (2). 

10 (b) LIMITATION.— 

11 (1) CONDITIONAL DISTRIBUTION TO MULTILAT12 ERAL FUNDS OR INTERNATIONAL INSTITUTIONS.— 

13 In any fiscal year, the Secretary of State, or such 

14 other Federal agency head as the President may 

15 designate, in consultation with the Administrator of 

16 USAID, the Secretary of the Treasury, and the Ad17 ministrator of the Environmental Protection Agency, 

18 shall distribute at least 40 percent and up to 60 per19 cent of the allowances available to carry out the Pro20 gram to one or more multilateral funds or inter21 national institutions that meet the requirements of 

22 paragraph (2), if any such fund or institution exists, 

23 and shall annually certify in a report to the appro24 priate congressional committees that any multilat25 eral fund or international institution receiving allowVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 01187 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ances under this section meets the requirements of 

2 paragraph (2) or that no multilateral fund or inter3 national institution that meets the requirements of 

4 paragraph (2) exists, as the case may be. The Sec5 retary of State shall notify the appropriate congres6 sional committees not less than 15 days prior to any 

7 transfer of allowances to a multilateral fund or 

8 international institution pursuant to this section. 

9 (2) MULTILATERAL FUND OR INTERNATIONAL

10 INSTITUTION ELIGIBILITY.—A multilateral fund or 

11 international institution is eligible to receive allow12 ances available to carry out the Program— 

13 (A) if— 

14 (i) such fund or institution is estab15 lished pursuant to— 

16 (I) the Convention; or 

17 (II) an agreement negotiated 

18 under the Convention; or 

19 (ii) the allowances are directed to one 

20 or more multilateral development banks or 

21 international development institutions, pur22 suant to an agreement negotiated under 

23 such Convention; and 

24 (B) if such fund or institution— 


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1 (i) specifies the terms and conditions 

2 under which the United States is to pro3 vide allowances to the fund or institution, 

4 and under which the fund or institution is 

5 to provide assistance to recipient countries; 

6 (ii) ensures that assistance from the 

7 United States to the fund or institution 

8 and the principal and income of the fund 

9 or institution are disbursed only for pur10 poses that are consistent with those de11 scribed in section 491(b)(1); 

12 (iii) requires a regular meeting of a 

13 governing body of the fund or institution 

14 that includes representation from countries 

15 among the most vulnerable developing 

16 countries and provides public access; 

17 (iv) requires that local communities 

18 and indigenous peoples in areas where any 

19 activities or programs are planned are en20 gaged through adequate disclosure of in21 formation, public participation, and con22 sultation; and 

23 (v) prepares and makes public an an24 nual report that— 


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1 (I) describes the process and 

2 methodology for selecting the recipi3 ents of assistance from the fund or in4 stitution, including assessments of 

5 vulnerability; 

6 (II) describes specific programs 

7 and activities supported by the fund 

8 or institution and the extent to which 

9 the assistance is addressing the adap10 tation needs of the most vulnerable 

11 developing countries, and the most 

12 vulnerable communities and popu13 lations therein; 

14 (III) describes the performance 

15 goals for assistance authorized under 

16 the fund or institution and expresses 

17 such goals in an objective and quan18 tifiable form, to the extent practicable; 

19 (IV) describes the performance 

20 indicators to be used in measuring or 

21 assessing the achievement of the per22 formance goals described in subclause 

23 (III); 

24 (V) provides a basis for rec25 ommendations for adjustments to asVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 01190 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 sistance authorized under this part to 

2 enhance the impact of such assist3 ance; and 

4 (VI) describes the participation 

5 of other nations and international or6 ganizations in supporting and gov7 erning the fund or institution. 

8 (c) OVERSIGHT.— 

9 (1) DISTRIBUTION TO MULTILATERAL FUNDS

10 OR INTERNATIONAL INSTITUTIONS.—The Secretary 

11 of State, or such other Federal agency head as the 

12 President may designate, in consultation with the 

13 Administrator of USAID, shall oversee the distribu14 tion of allowances available to carry out the Pro15 gram to a multilateral fund or international institu16 tion under subsection (b). 

17 (2) BILATERAL ASSISTANCE.—The Adminis18 trator of USAID, in consultation with the Secretary 

19 of State, shall oversee the distribution of allowances 

20 available to carry out the Program for bilateral as21 sistance under section 495. 

22 SEC. 495. BILATERAL ASSISTANCE. 

23 (a) ACTIVITIES AND FOREIGN AID.— 

24 (1) IN GENERAL.—In order to achieve the pur25 poses of this part, the Administrator of USAID may 


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1 carry out programs and activities and distribute al2 lowances to any private or public group (including 

3 international organizations and faith-based organiza4 tions), association, or other entity engaged in peace5 ful activities to— 

6 (A) provide assistance to the most vulner7 able developing countries for— 

8 (i) the development of national or re9 gional climate change adaptation plans, in10 cluding a systematic assessment of socio11 economic vulnerabilities in order to identify 

12 the most vulnerable communities and pop13 ulations; 

14 (ii) associated national policies; and 

15 (iii) planning, financing, and execu16 tion of adaptation programs and activities; 

17 (B) support investments, capacity-building 

18 activities, and other assistance, to reduce vul19 nerability and promote community-level resil20 ience related to climate change and its impacts 

21 in the most vulnerable developing countries, in22 cluding impacts on water availability, agricul23 tural productivity, flood risk, coastal resources, 

24 timing of seasons, biodiversity, economic liveli25 hoods, health, human migration, or other social, 


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1 economic, political, cultural, or environmental 

2 matters; 

3 (C) support climate change adaptation re4 search in or for the most vulnerable developing 

5 countries; 

6 (D) reduce vulnerability and provide in7 creased resilience to climate change for local 

8 communities and livelihoods in the most vulner9 able developing countries by encouraging— 

10 (i) the protection and rehabilitation of 

11 natural systems; 

12 (ii) the enhancement and diversifica13 tion of agricultural, fishery, and other live14 lihoods; and 

15 (iii) the reduction of disaster risks; 

16 (E) support the deployment of technologies 

17 to help the most vulnerable developing countries 

18 respond to the destabilizing impacts of climate 

19 change and encourage the identification and 

20 adoption of appropriate renewable and efficient 

21 energy technologies that are beneficial in in22 creasing community-level resilience to the im23 pacts of global climate change in those coun24 tries; and 


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1 (F) encourage the engagement of local 

2 communities through disclosure of information, 

3 consultation, and the communities’ informed 

4 participation relating to the development of 

5 plans, programs, and activities to increase com6 munity-level resilience to climate change im7 pacts. 

8 (2) LIMITATIONS.—Not more than 10 percent 

9 of the allowances made available to carry out bilat10 eral assistance under this part in any year shall be 

11 distributed to support activities in any single coun12 try. 

13 (3) PRIORITIZING ASSISTANCE.—In providing 

14 assistance under this section, the Administrator of 

15 USAID shall give priority to countries, including the 

16 most vulnerable communities and populations there17 in, that are most vulnerable to the adverse impacts 

18 of climate change, determined by the likelihood and 

19 severity of such impacts and the country’s capacity 

20 to adapt to such impacts. 

21 (b) COMMUNITY ENGAGEMENT.— 

22 (1) IN GENERAL.—The Administrator of 

23 USAID shall ensure that local communities, includ24 ing the most vulnerable communities and popu25 lations therein, in areas where any programs or acVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 01194 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 tivities are carried out pursuant to this section are 

2 engaged in, through disclosure of information, public 

3 participation, and consultation, the design, imple4 mentation, monitoring, and evaluation of such pro5 grams and activities. 

6 (2) CONSULTATION AND DISCLOSURE.—For 

7 each country receiving assistance under this section, 

8 the Administrator of USAID shall establish a proc9 ess for consultation with, and disclosure of informa10 tion to, local, national, and international stake11 holders regarding any programs and activities car12 ried out pursuant to this section. 

13 (c) COORDINATION.— 

14 (1) ALIGNMENT OF ACTIVITIES.—Subject to the 

15 direction of the President and the Secretary of 

16 State, the Administrator of USAID shall, to the ex17 tent practicable, seek to align activities under this 

18 section with broader development, poverty allevi19 ation, or natural resource management objectives 

20 and initiatives in the recipient country. 

21 (2) COORDINATION OF ACTIVITIES.—The Ad22 ministrator of USAID shall ensure that there is co23 ordination among the activities under this section, 

24 subtitle D of this title, and part E of title VII of the 


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1 Clean Air Act, in order to maximize the effectiveness 

2 of United States assistance to developing countries. 

3 (d) REPORTING.— 

4 (1) INITIAL REPORT.—Not later than 180 days 

5 after the date of enactment of this part, the Admin6 istrator of USAID, in consultation with the Sec7 retary of State, shall submit to the President and 

8 the appropriate congressional committees an initial 

9 report that— 

10 (A) based on the most recent information 

11 available from reliable public sources or knowl12 edge obtained by USAID on a reliable basis, as 

13 determined by the Administrator of USAID, 

14 identifies the developing countries, including the 

15 most vulnerable communities and populations 

16 therein, that are most vulnerable to climate 

17 change impacts and in which assistance may 

18 have the greatest and most sustainable benefit 

19 in reducing vulnerability to climate change; and 

20 (B) describes the process and methodology 

21 for selecting the recipients of assistance under 

22 subsection (a)(1). 

23 (2) ANNUAL REPORTS.—Not later than 18 

24 months after the date on which the initial report is 

25 submitted pursuant to paragraph (1), and annually 


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1 thereafter, the Administrator of USAID, in consulta2 tion with the Secretary of State, shall submit to the 

3 President and the appropriate congressional commit4 tees a report that— 

5 (A) describes the extent to which global cli6 mate change, through its potential negative im7 pacts on sensitive populations and natural re8 sources in the most vulnerable developing coun9 tries, may threaten, cause, or exacerbate polit10 ical, economic, environmental, cultural, or social 

11 instability or international conflict in those re12 gions; 

13 (B) describes the ramifications of any po14 tentially destabilizing impacts climate change 

15 may have on the national security, foreign pol16 icy, and economic interests of the United 

17 States, including— 

18 (i) the creation of environmental mi19 grants and internally displaced peoples; 

20 (ii) international or internal armed 

21 conflicts over water, food, land, or other 

22 resources; 

23 (iii) loss of agricultural and other live24 lihoods, cultural stability, and other causes 


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1 of increased poverty and economic desta2 bilization; 

3 (iv) decline in availability of resources 

4 needed for survival, including water; 

5 (v) increased impact of natural disas6 ters (including droughts, flooding, and 

7 other severe weather events); 

8 (vi) increased prevalence or virulence 

9 of climate-related diseases; and 

10 (vii) intensified urban migration; 

11 (C) describes how allowances available 

12 under this section were distributed during the 

13 previous fiscal year to enhance the national se14 curity, foreign policy, and economic interests of 

15 the United States and assist in avoiding the 

16 economically, politically, environmentally, cul17 turally, and socially destabilizing impacts of cli18 mate change in most vulnerable developing 

19 countries; 

20 (D) identifies and recommends the devel21 oping countries, including the most vulnerable 

22 communities and populations therein, that are 

23 most vulnerable to climate change impacts and 

24 in which assistance may have the greatest and 

25 most sustainable benefit in reducing vulnerVerDate Nov 24 2008 00:27 Jun 25, 2009 Jkt 079200 PO 00000 Frm 01198 Fmt 6652 Sfmt 6201 E:\BILLS\H2998.IH H2998

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1 ability to climate change, including in the form 

2 of deploying technologies, investments, capacity3 building activities, and other types of assistance 

4 for adaptation to climate change impacts and 

5 approaches to reduce greenhouse gases in ways 

6 that may also provide community-level resilience 

7 to climate change impacts; and 

8 (E) describes cooperation undertaken with 

9 other nations and international organizations to 

10 carry out this part. 

11 (e) MONITORING AND EVALUATION.— 

12 (1) IN GENERAL.—The Administrator of 

13 USAID shall establish and implement a system to 

14 monitor and evaluate the effectiveness and efficiency 

15 of assistance provided under this section in order to 

16 maximize the long-term sustainable development im17 pact of such assistance, including the extent to 

18 which such assistance is meeting the purposes of 

19 this part and addressing the adaptation needs of de20 veloping countries. 

21 (2) REQUIREMENTS.—In carrying out para22 graph (1), the Administrator of USAID shall— 

23 (A) in consultation with national govern24 ments in recipient countries, establish perform25 ance goals for assistance authorized under this 


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1 section and express such goals in an objective 

2 and quantifiable form, to the extent practicable; 

3 (B) establish performance indicators to be 

4 used in measuring or assessing the achievement 

5 of the performance goals described in subpara6 graph (A), including an evaluation of— 

7 (i) the extent to which assistance 

8 under this section provided for disclosure 

9 of information to, consultation with, and 

10 informed participation by local commu11 nities; 

12 (ii) the extent to which local commu13 nities participated in the design, implemen14 tation, and evaluation of programs and ac15 tivities implemented pursuant to this sec16 tion; and 

17 (iii) the impacts of such participation 

18 on the goals and objectives of the pro19 grams and activities implemented under 

20 this section; 

21 (C) provide a basis for recommendations 

22 for adjustments to assistance authorized under 

23 this section to enhance the impact of such as24 sistance; and 


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1 (D) include, in the annual report to the 

2 appropriate congressional committees and other 

3 relevant agencies required under subsection 

4 (d)(2), findings resulting from the monitoring 

5 and evaluation of programs and activities under 

6 this section. 

Æ 


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