shall adjust for inflation the amount of the civil penalty 
per kilowatt-hour under subsection (c)(2). 
‘‘(g) STATE PROGRAMS.—Nothing in this section 
shall diminish any authority of a State or political subdivi-
sion thereof to adopt or enforce any law or regulation re-
specting renewable energy, but, except as provided in sub-
section (c)(3), no such law or regulation shall relieve any 
person of any requirement otherwise applicable under this 
section. The Secretary, in consultation with States having 
such renewable energy programs, shall, to the maximum 
extent practicable, facilitate coordination between the Fed-
eral program and State programs. 
‘‘(h) DEFINITIONS.—For purposes of this section: 
‘‘(1) BASE
AMOUNT
OF
ELECTRICITY.—The 
term ‘base amount of electricity’ means the total 
amount of electricity sold by an electric utility to 
electric consumers in a calendar year, excluding— 
‘‘(A) electricity generated by a hydro-
electric facility (including a pumped storage fa-
cility but excluding incremental hydropower); 
and 
‘‘(B) electricity generated through the in-
cineration of municipal solid waste. 
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‘‘(2) DISTRIBUTED
GENERATION
FACILITY.— 
The term ‘distributed generation facility’ means a 
facility at a customer site. 
‘‘(3) EXISTING
RENEWABLE
ENERGY.—The 
term ‘existing renewable energy’ means, except as 
provided in paragraph (7)(B), electric energy gen-
erated at a facility (including a distributed genera-
tion facility) placed in service prior to the date of 
enactment of this section from solar, wind, or geo-
thermal energy; ocean energy; biomass (as defined in 
section 203(a) of the Energy Policy Act of 2005); or 
landfill gas. 
‘‘(4) GEOTHERMAL ENERGY.—The term ‘geo-
thermal energy’ means energy derived from a geo-
thermal deposit (within the meaning of section 
613(e)(2) of the Internal Revenue Code of 1986). 
‘‘(5) INCREMENTAL
GEOTHERMAL
PRODUC-
TION.— 
‘‘(A) IN GENERAL.—The term ‘incremental 
geothermal production’ means for any year the 
excess of— 
‘‘(i) the total kilowatt hours of elec-
tricity produced from a facility (including a 
distributed generation facility) using geo-
thermal energy, over 
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‘‘(ii) the average annual kilowatt 
hours produced at such facility for 5 of the 
previous 7 calendar years before the date 
of enactment of this section after elimi-
nating the highest and the lowest kilowatt 
hour production years in such 7-year pe-
riod. 
‘‘(B) SPECIAL RULE.—A facility described 
in subparagraph (A) which was placed in serv-
ice at least 7 years before the date of enactment 
of this section shall commencing with the year 
in which such date of enactment occurs, reduce 
the amount calculated under subparagraph 
(A)(ii) each year, on a cumulative basis, by the 
average percentage decrease in the annual kilo-
watt hour production for the 7-year period de-
scribed in subparagraph (A)(ii) with such cu-
mulative sum not to exceed 30 percent. 
‘‘(6) INCREMENTAL HYDROPOWER.—The term 
‘incremental hydropower’ means additional energy 
generated as a result of efficiency improvements or 
capacity additions made on or after the date of en-
actment of this section or the effective date of an ex-
isting applicable State renewable portfolio standard 
program at a hydroelectric facility that was placed 
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in service before that date. The term does not in-
clude additional energy generated as a result of 
operational changes not directly associated with effi-
ciency improvements or capacity additions. Effi-
ciency improvements and capacity additions shall be 
measured on the basis of the same water flow infor-
mation used to determine a historic average annual 
generation baseline for the hydroelectric facility and 
certified by the Secretary or the Federal Energy 
Regulatory Commission. 
‘‘(7) NEW
RENEWABLE
ENERGY.—The term 
‘new renewable energy’ means— 
‘‘(A) electric energy generated at a facility 
(including a distributed generation facility) 
placed in service on or after January 1, 2003, 
from— 
‘‘(i) solar, wind, or geothermal energy 
or ocean energy; 
‘‘(ii) biomass (as defined in section 
203(a) of the Energy Policy Act of 2005); 
‘‘(iii) landfill gas; or 
‘‘(iv) incremental hydropower; and 
‘‘(B) for electric energy generated at a fa-
cility (including a distributed generation facil-
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ity) placed in service prior to the date of enact-
ment of this section— 
‘‘(i) the additional energy above the 
average generation in the 3 years pre-
ceding the date of enactment of this sec-
tion at the facility from— 
‘‘(I) solar or wind energy or 
ocean energy; 
‘‘(II) biomass (as defined in sec-
tion 203(a) of the Energy Policy Act 
of 2005); 
‘‘(III) landfill gas; or 
‘‘(IV) incremental hydropower. 
‘‘(ii) the incremental geothermal pro-
duction. 
‘‘(8) OCEAN ENERGY.—The term ‘ocean energy’ 
includes current, wave, tidal, and thermal energy. 
‘‘(i) SUNSET.—This section expires on December 31, 
2030.’’. 
SEC. 13. FEDERAL ENERGY PURCHASE REQUIREMENT. 
Section 203(a) of the Energy Policy Act of 2005 (42 
U.S.C. 15852(a)) is amended— 
(1) by striking ‘‘seek to ensure that, to the ex-
tent economically feasible and technically prac-
ticable’’ and inserting ‘‘ensure that’’; 
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