(A) Clauses (i) and (ii) of paragraph 
(2)(A). 
(B) Clauses (i)(I) and (ii) of paragraph 
(3)(A). 
(C) Paragraph (4). 
(D) Paragraph (5). 
(E) Paragraph (6). 
(F) Paragraph (7). 
(G) Subparagraphs (A) and (B) of para-
graph (9). 
(b) MODIFICATION OF REFINED COAL AS A QUALIFIED 
ENERGY RESOURCE.— 
(1) ELIMINATION OF INCREASED MARKET VALUE 
TEST.—Section 45(c)(7)(A)(i) (defining refined coal), 
as amended by section 108, is amended— 
(A) by striking subclause (IV), 
(B) by adding ‘‘and’’ at the end of subclause 
(II), and 
(C) by striking ‘‘, and’’ at the end of sub-
clause (III) and inserting a period. 
(2) INCREASE IN REQUIRED EMISSION REDUC-
TION.—Section 45(c)(7)(B) (defining qualified emis-
sion reduction) is amended by inserting ‘‘at least 40 
percent of the emissions of’’ after ‘‘nitrogen oxide 
and’’.
(c) TRASH FACILITY CLARIFICATION.—Paragraph (7) 
of section 45(d) is amended— 
(1) by striking ‘‘facility which burns’’ and in-
serting ‘‘facility (other than a facility described in 
paragraph (6)) which uses’’, and 
(2) by striking ‘‘COMBUSTION’’. 
(d) EXPANSION OF BIOMASS FACILITIES.— 
(1) OPEN-LOOP
BIOMASS
FACILITIES.—Para-
graph (3) of section 45(d) is amended by redesig-
nating subparagraph (B) as subparagraph (C) and 
by inserting after subparagraph (A) the following new 
subparagraph: 
‘‘(B) EXPANSION OF FACILITY.—Such term 
shall include a new unit placed in service after 
the date of the enactment of this subparagraph 
in connection with a facility described in sub-
paragraph (A), but only to the extent of the in-
creased amount of electricity produced at the fa-
cility by reason of such new unit.’’. 
(2) CLOSED-LOOP BIOMASS FACILITIES.—Para-
graph (2) of section 45(d) is amended by redesig-
nating subparagraph (B) as subparagraph (C) and 
inserting after subparagraph (A) the following new 
subparagraph:
‘‘(B) EXPANSION OF FACILITY.—Such term 
shall include a new unit placed in service after 
the date of the enactment of this subparagraph 
in connection with a facility described in sub-
paragraph (A)(i), but only to the extent of the 
increased amount of electricity produced at the 
facility by reason of such new unit.’’. 
(e) MODIFICATION OF RULES FOR HYDROPOWER PRO-
DUCTION.—Subparagraph (C) of section 45(c)(8) is amend-
ed to read as follows: 
‘‘(C) NONHYDROELECTRIC DAM.—For pur-
poses of subparagraph (A), a facility is described 
in this subparagraph if— 
‘‘(i) the hydroelectric project installed 
on the nonhydroelectric dam is licensed by 
the Federal Energy Regulatory Commission 
and meets all other applicable environ-
mental, licensing, and regulatory require-
ments, 
‘‘(ii) the nonhydroelectric dam was 
placed in service before the date of the en-
actment of this paragraph and operated for 
flood control, navigation, or water supply 
purposes and did not produce hydroelectric
power on the date of the enactment of this 
paragraph, and 
‘‘(iii) the hydroelectric project is oper-
ated so that the water surface elevation at 
any given location and time that would 
have occurred in the absence of the hydro-
electric project is maintained, subject to any 
license requirements imposed under applica-
ble law that change the water surface ele-
vation for the purpose of improving envi-
ronmental quality of the affected waterway. 
The Secretary, in consultation with the Federal 
Energy Regulatory Commission, shall certify if a 
hydroelectric project licensed at a nonhydro-
electric dam meets the criteria in clause (iii). 
Nothing in this section shall affect the standards 
under which the Federal Energy Regulatory 
Commission issues licenses for and regulates hy-
dropower projects under part I of the Federal 
Power Act.’’. 
(f) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided 
in this subsection, the amendments made by this sec-
tion shall apply to property originally placed in serv-
ice after December 31, 2008.
(2) REFINED COAL.—The amendments made by 
subsection (b) shall apply to coal produced and sold 
from facilities placed in service after December 31, 
2008. 
(3) 
TRASH
FACILITY
CLARIFICATION.—The 
amendments made by subsection (c) shall apply to 
electricity produced and sold after the date of the en-
actment of this Act. 
(4) EXPANSION
OF
BIOMASS
FACILITIES.—The 
amendments made by subsection (d) shall apply to 
property placed in service after the date of the enact-
ment of this Act. 
SEC. 102. PRODUCTION CREDIT FOR ELECTRICITY PRO-
DUCED FROM MARINE RENEWABLES. 
(a) IN GENERAL.—Paragraph (1) of section 45(c) is 
amended by striking ‘‘and’’ at the end of subparagraph (G), 
by striking the period at the end of subparagraph (H) and 
inserting ‘‘, and’’, and by adding at the end the following 
new subparagraph: 
‘‘(I) marine and hydrokinetic renewable en-
ergy.’’. 
(b) MARINE RENEWABLES.—Subsection (c) of section 
45 is amended by adding at the end the following new para-
graph:
utable to’’ and inserting ‘‘section 46 to the extent that 
such credit is attributable to the rehabilitation credit 
under section 47, but only with respect to’’. 
(c) ENERGY CREDIT
FOR COMBINED HEAT
AND 
POWER SYSTEM PROPERTY.— 
(1) IN GENERAL.—Section 48(a)(3)(A) is amend-
ed by striking ‘‘or’’ at the end of clause (iii), by in-
serting ‘‘or’’ at the end of clause (iv), and by adding 
at the end the following new clause: 
‘‘(v) combined heat and power system 
property,’’. 
(2) COMBINED HEAT AND POWER SYSTEM PROP-
ERTY.—Subsection (c) of section 48 is amended— 
(A) by striking ‘‘QUALIFIED FUEL CELL 
PROPERTY; QUALIFIED MICROTURBINE PROP-
ERTY’’ in the heading and inserting ‘‘DEFINI-
TIONS’’, and 
(B) by adding at the end the following new 
paragraph: 
‘‘(3) COMBINED HEAT AND POWER SYSTEM PROP-
ERTY.— 
‘‘(A) COMBINED HEAT AND POWER SYSTEM 
PROPERTY.—The term ‘combined heat and power 
system property’ means property comprising a 
system—
‘‘(i) which uses the same energy source 
for the simultaneous or sequential genera-
tion of electrical power, mechanical shaft 
power, or both, in combination with the 
generation of steam or other forms of useful 
thermal energy (including heating and cool-
ing applications), 
‘‘(ii) which produces— 
‘‘(I) at least 20 percent of its total 
useful energy in the form of thermal 
energy which is not used to produce 
electrical or mechanical power (or com-
bination thereof), and 
‘‘(II) at least 20 percent of its 
total useful energy in the form of elec-
trical or mechanical power (or com-
bination thereof), 
‘‘(iii) the energy efficiency percentage 
of which exceeds 60 percent, and 
‘‘(iv) which is placed in service before 
January 1, 2017. 
‘‘(B) LIMITATION.— 
‘‘(i) IN GENERAL.—In the case of com-
bined heat and power system property with 
an electrical capacity in excess of the appli-
cable capacity placed in service during the 
taxable year, the credit under subsection 
(a)(1) (determined without regard to this 
paragraph) for such year shall be equal to 
the amount which bears the same ratio to 
such credit as the applicable capacity bears 
to the capacity of such property. 
‘‘(ii) 
APPLICABLE
CAPACITY.—For 
purposes of clause (i), the term ‘applicable 
capacity’ means 15 megawatts or a me-
chanical energy capacity of more than 
20,000 horsepower or an equivalent com-
bination of electrical and mechanical energy 
capacities. 
‘‘(iii) MAXIMUM CAPACITY.—The term 
‘combined heat and power system property’ 
shall not include any property comprising a 
system if such system has a capacity in ex-
cess of 50 megawatts or a mechanical en-
ergy capacity in excess of 67,000 horsepower 
or an equivalent combination of electrical 
and mechanical energy capacities. 
‘‘(C) SPECIAL RULES.— 
‘‘(i) ENERGY
EFFICIENCY
PERCENT-
AGE.—For purposes of this paragraph, the
energy efficiency percentage of a system is 
the fraction— 
‘‘(I) the numerator of which is the 
total useful electrical, thermal, and me-
chanical power produced by the system 
at normal operating rates, and ex-
pected to be consumed in its normal 
application, and 
‘‘(II) the denominator of which is 
the lower heating value of the fuel 
sources for the system. 
‘‘(ii) DETERMINATIONS MADE ON BTU 
BASIS.—The energy efficiency percentage 
and the percentages under subparagraph 
(A)(ii) shall be determined on a Btu basis. 
‘‘(iii) INPUT AND OUTPUT PROPERTY 
NOT INCLUDED.—The term ‘combined heat 
and power system property’ does not in-
clude property used to transport the energy 
source to the facility or to distribute energy 
produced by the facility. 
‘‘(D) SYSTEMS USING BIOMASS.—If a sys-
tem is designed to use biomass (within the mean-
ing of paragraphs (2) and (3) of section 45(c) 
without regard to the last sentence of paragraph
(3)(A)) for at least 90 percent of the energy 
source— 
‘‘(i) subparagraph (A)(iii) shall not 
apply, but 
‘‘(ii) the amount of credit determined 
under subsection (a) with respect to such 
system shall not exceed the amount which 
bears the same ratio to such amount of cred-
it (determined without regard to this sub-
paragraph) as the energy efficiency percent-
age of such system bears to 60 percent.’’. 
(3) CONFORMING AMENDMENT.—Section 48(a)(1) 
is amended by striking ‘‘paragraphs (1)(B) and 
(2)(B)’’ and inserting ‘‘paragraphs (1)(B), (2)(B), 
and (3)(B)’’. 
(d) INCREASE OF CREDIT LIMITATION FOR FUEL CELL 
PROPERTY.—Subparagraph (B) of section 48(c)(1) is 
amended by striking ‘‘$500’’ and inserting ‘‘$1,500’’. 
(e) PUBLIC UTILITY PROPERTY TAKEN INTO AC-
COUNT.— 
(1) IN
GENERAL.—Paragraph (3) of section 
48(a) is amended by striking the second sentence 
thereof. 
(2) CONFORMING AMENDMENTS.—
(A) Paragraph (1) of section 48(c) is 
amended by striking subparagraph (D) and re-
designating subparagraph (E) as subparagraph 
(D). 
(B) Paragraph (2) of section 48(c) is 
amended by striking subparagraph (D) and re-
designating subparagraph (E) as subparagraph 
(D). 
(f) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided 
in this subsection, the amendments made by this sec-
tion shall take effect on the date of the enactment of 
this Act. 
(2) ALLOWANCE AGAINST ALTERNATIVE MINIMUM 
TAX.—The amendments made by subsection (b) shall 
apply to credits determined under section 46 of the 
Internal Revenue Code of 1986 in taxable years begin-
ning after the date of the enactment of this Act and 
to carrybacks of such credits. 
(3) COMBINED
HEAT
AND
POWER
AND
FUEL 
CELL
PROPERTY.—The amendments made by sub-
sections (c) and (d) shall apply to periods after the 
date of the enactment of this Act, in taxable years 
ending after such date, under rules similar to the 
rules of section 48(m) of the Internal Revenue Code
of 1986 (as in effect on the day before the date of the 
enactment of the Revenue Reconciliation Act of 1990). 
(4) PUBLIC
UTILITY
PROPERTY.—The amend-
ments made by subsection (e) shall apply to periods 
after February 13, 2008, in taxable years ending after 
such date, under rules similar to the rules of section 
48(m) of the Internal Revenue Code of 1986 (as in ef-
fect on the day before the date of the enactment of the 
Revenue Reconciliation Act of 1990). 
SEC. 104. ENERGY CREDIT FOR SMALL WIND PROPERTY. 
(a) IN GENERAL.—Section 48(a)(3)(A), as amended by 
section 103, is amended by striking ‘‘or’’ at the end of clause 
(iv), by adding ‘‘or’’ at the end of clause (v), and by insert-
ing after clause (v) the following new clause: 
‘‘(vi) qualified small wind energy 
property,’’. 
(b) 30 PERCENT CREDIT.—Section 48(a)(2)(A)(i) is 
amended by striking ‘‘and’’ at the end of subclause (II) and 
by inserting after subclause (III) the following new sub-
clause: 
‘‘(IV) qualified small wind energy 
property, and’’. 
(c) QUALIFIED SMALL WIND ENERGY PROPERTY.— 
Section 48(c), as amended by section 103, is amended by 
adding at the end the following new paragraph:
‘‘(4) QUALIFIED
SMALL
WIND
ENERGY
PROP-
ERTY.— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
small wind energy property’ means property 
which uses a qualifying small wind turbine to 
generate electricity. 
‘‘(B) LIMITATION.—In the case of qualified 
small wind energy property placed in service 
during the taxable year, the credit otherwise de-
termined under subsection (a)(1) for such year 
with respect to all such property of the taxpayer 
shall not exceed $4,000. 
‘‘(C) QUALIFYING SMALL WIND TURBINE.— 
The term ‘qualifying small wind turbine’ means 
a wind turbine which has a nameplate capacity 
of not more than 100 kilowatts. 
‘‘(D) TERMINATION.—The term ‘qualified 
small wind energy property’ shall not include 
any property for any period after December 31, 
2016.’’. 
(d) CONFORMING AMENDMENT.—Section 48(a)(1), as 
amended by section 103, is amended by striking ‘‘para-
graphs (1)(B), (2)(B), and (3)(B)’’ and inserting ‘‘para-
graphs (1)(B), (2)(B), (3)(B), and (4)(B)’’.
(e) EFFECTIVE DATE.—The amendments made by this 
section shall apply to periods after the date of the enactment 
of this Act, in taxable years ending after such date, under 
rules similar to the rules of section 48(m) of the Internal 
Revenue Code of 1986 (as in effect on the day before the 
date of the enactment of the Revenue Reconciliation Act of 
1990). 
SEC. 105. ENERGY CREDIT FOR GEOTHERMAL HEAT PUMP 
SYSTEMS. 
(a) IN
GENERAL.—Subparagraph (A) of section 
48(a)(3), as amended by this Act, is amended by striking 
‘‘or’’ at the end of clause (v), by inserting ‘‘or’’ at the end 
of clause (vi), and by adding at the end the following new 
clause: 
‘‘(vii) 
equipment 
which 
uses 
the 
ground or ground water as a thermal en-
ergy source to heat a structure or as a ther-
mal energy sink to cool a structure, but 
only with respect to periods ending before 
January 1, 2017,’’. 
(b) EFFECTIVE DATE.—The amendments made by this 
section shall apply to periods after the date of the enactment 
of this Act, in taxable years ending after such date, under 
rules similar to the rules of section 48(m) of the Internal 
Revenue Code of 1986 (as in effect on the day before the
date of the enactment of the Revenue Reconciliation Act of 
1990). 
SEC. 106. CREDIT FOR RESIDENTIAL ENERGY EFFICIENT 
PROPERTY. 
(a) EXTENSION.—Section 25D(g) is amended by strik-
ing ‘‘December 31, 2008’’ and inserting ‘‘December 31, 
2016’’. 
(b) REMOVAL OF LIMITATION FOR SOLAR ELECTRIC 
PROPERTY.— 
(1) IN GENERAL.—Section 25D(b)(1), as amend-
ed by subsections (c) and (d), is amended— 
(A) by striking subparagraph (A), and 
(B) by redesignating subparagraphs (B) 
through (E) as subparagraphs (A) through and 
(D), respectively. 
(2) 
CONFORMING
AMENDMENT.—Section 
25D(e)(4)(A), as amended by subsections (c) and (d), 
is amended— 
(A) by striking clause (i), and 
(B) by redesignating clauses (ii) through (v) 
as clauses (i) and (iv), respectively. 
(c) CREDIT FOR RESIDENTIAL WIND PROPERTY.— 
(1) IN GENERAL.—Section 25D(a) is amended by 
striking ‘‘and’’ at the end of paragraph (2), by strik-
ing the period at the end of paragraph (3) and insert-
ing ‘‘, and’’, and by adding at the end the following 
new paragraph: 
‘‘(4) 30 percent of the qualified small wind en-
ergy property expenditures made by the taxpayer 
during such year.’’. 
(2) LIMITATION.—Section 25D(b)(1) is amended 
by striking ‘‘and’’ at the end of subparagraph (B), by 
striking the period at the end of subparagraph (C) 
and inserting ‘‘, and’’, and by adding at the end the 
following new subparagraph: 
‘‘(D) $500 with respect to each half kilowatt 
of capacity (not to exceed $4,000) of wind tur-
bines for which qualified small wind energy 
property expenditures are made.’’. 
(3) QUALIFIED SMALL WIND ENERGY PROPERTY 
EXPENDITURES.— 
(A) 
IN
GENERAL.—Section 
25D(d) 
is 
amended by adding at the end the following new 
paragraph: 
‘‘(4) QUALIFIED SMALL WIND ENERGY PROPERTY 
EXPENDITURE.—The term ‘qualified small wind en-
ergy property expenditure’ means an expenditure for 
property which uses a wind turbine to generate elec-
tricity for use in connection with a dwelling unit lo-
cated in the United States and used as a residence by 
the taxpayer.’’. 
(B) 
NO
DOUBLE
BENEFIT.—Section 
45(d)(1) is amended by adding at the end the 
following new sentence: ‘‘Such term shall not in-
clude any facility with respect to which any 
qualified small wind energy property expendi-
ture (as defined in subsection (d)(4) of section 
25D) is taken into account in determining the 
credit under such section.’’. 
(4) MAXIMUM EXPENDITURES IN CASE OF JOINT 
OCCUPANCY.—Section 25D(e)(4)(A) is amended by 
striking ‘‘and’’ at the end of clause (ii), by striking 
the period at the end of clause (iii) and inserting ‘‘, 
and’’, and by adding at the end the following new 
clause: 
‘‘(iv) $1,667 in the case of each half 
kilowatt of capacity (not to exceed $13,333) 
of wind turbines for which qualified small 
wind energy property expenditures are 
made.’’. 
(d) CREDIT
FOR GEOTHERMAL HEAT
PUMP SYS-
TEMS.— 
(1) IN GENERAL.—Section 25D(a), as amended 
by subsection (c), is amended by striking ‘‘and’’ at the
end of paragraph (3), by striking the period at the 
end of paragraph (4) and inserting ‘‘, and’’, and by 
adding at the end the following new paragraph: 
‘‘(5) 30 percent of the qualified geothermal heat 
pump property expenditures made by the taxpayer 
during such year.’’. 
(2) LIMITATION.—Section 25D(b)(1), as amend-
ed by subsection (c), is amended by striking ‘‘and’’ at 
the end of subparagraph (C), by striking the period 
at the end of subparagraph (D) and inserting ‘‘, 
and’’, and by adding at the end the following new 
subparagraph: 
‘‘(E) $2,000 with respect to any qualified 
geothermal heat pump property expenditures.’’. 
(3) QUALIFIED GEOTHERMAL HEAT PUMP PROP-
ERTY EXPENDITURE.—Section 25D(d), as amended by 
subsection (c), is amended by adding at the end the 
following new paragraph: 
‘‘(5) QUALIFIED
GEOTHERMAL
HEAT
PUMP 
PROPERTY EXPENDITURE.— 
‘‘(A) IN GENERAL.—The term ‘qualified geo-
thermal heat pump property expenditure’ means 
an expenditure for qualified geothermal heat 
pump property installed on or in connection
with a dwelling unit located in the United States 
and used as a residence by the taxpayer. 
‘‘(B) QUALIFIED GEOTHERMAL HEAT PUMP 
PROPERTY.—The term ‘qualified geothermal heat 
pump property’ means any equipment which— 
‘‘(i) uses the ground or ground water 
as a thermal energy source to heat the 
dwelling unit referred to in subparagraph 
(A) or as a thermal energy sink to cool such 
dwelling unit, and 
‘‘(ii) meets the requirements of the En-
ergy Star program which are in effect at 
the time that the expenditure for such 
equipment is made.’’. 
(4) MAXIMUM EXPENDITURES IN CASE OF JOINT 
OCCUPANCY.—Section 25D(e)(4)(A), as amended by 
subsection (c), is amended by striking ‘‘and’’ at the 
end of clause (iii), by striking the period at the end 
of clause (iv) and inserting ‘‘, and’’, and by adding 
at the end the following new clause: 
‘‘(v) $6,667 in the case of any qualified 
geothermal heat pump property expendi-
tures.’’. 
(e) CREDIT ALLOWED AGAINST ALTERNATIVE MIN-
IMUM TAX.—
(1) IN GENERAL.—Subsection (c) of section 25D 
is amended to read as follows: 
‘‘(c) LIMITATION
BASED
ON
AMOUNT
OF
TAX; 
CARRYFORWARD OF UNUSED CREDIT.— 
‘‘(1) LIMITATION BASED ON AMOUNT OF TAX.— 
In the case of a taxable year to which section 26(a)(2) 
does not apply, the credit allowed under subsection 
(a) for the taxable year shall not exceed the excess 
of— 
‘‘(A) the sum of the regular tax liability (as 
defined in section 26(b)) plus the tax imposed by 
section 55, over 
‘‘(B) the sum of the credits allowable under 
this subpart (other than this section) and section 
27 for the taxable year. 
‘‘(2) CARRYFORWARD OF UNUSED CREDIT.— 
‘‘(A) RULE FOR YEARS IN WHICH ALL PER-
SONAL
CREDITS
ALLOWED
AGAINST
REGULAR 
AND ALTERNATIVE MINIMUM TAX.—In the case of 
a taxable year to which section 26(a)(2) applies, 
if the credit allowable under subsection (a) ex-
ceeds the limitation imposed by section 26(a)(2) 
for such taxable year reduced by the sum of the 
credits allowable under this subpart (other than 
this section), such excess shall be carried to the
succeeding taxable year and added to the credit 
allowable under subsection (a) for such suc-
ceeding taxable year. 
‘‘(B) RULE FOR OTHER YEARS.—In the case 
of a taxable year to which section 26(a)(2) does 
not apply, if the credit allowable under sub-
section (a) exceeds the limitation imposed by 
paragraph (1) for such taxable year, such excess 
shall be carried to the succeeding taxable year 
and added to the credit allowable under sub-
section (a) for such succeeding taxable year.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 23(b)(4)(B) is amended by in-
serting ‘‘and section 25D’’ after ‘‘this section’’. 
(B) Section 24(b)(3)(B) is amended by 
striking ‘‘and 25B’’ and inserting ‘‘, 25B, and 
25D’’. 
(C) Section 25B(g)(2) is amended by strik-
ing ‘‘section 23’’ and inserting ‘‘sections 23 and 
25D’’. 
(D) Section 26(a)(1) is amended by striking 
‘‘and 25B’’ and inserting ‘‘25B, and 25D’’. 
(f) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section shall
apply to taxable years beginning after December 31, 
2007. 
(2) SOLAR ELECTRIC PROPERTY LIMITATION.— 
The amendments made by subsection (b) shall apply 
to taxable years beginning after December 31, 2008. 
(3) APPLICATION
OF
EGTRRA
SUNSET.—The 
amendments made by subparagraphs (A) and (B) of 
subsection (e)(2) shall be subject to title IX of the Eco-
nomic Growth and Tax Relief Reconciliation Act of 
2001 in the same manner as the provisions of such 
Act to which such amendments relate. 
SEC. 107. NEW CLEAN RENEWABLE ENERGY BONDS. 
(a) IN GENERAL.—Subpart I of part IV of subchapter 
A of chapter 1 is amended by adding at the end the fol-
lowing new section: 
‘‘SEC. 54C. NEW CLEAN RENEWABLE ENERGY BONDS. 
‘‘(a) NEW CLEAN RENEWABLE ENERGY BOND.—For 
purposes of this subpart, the term ‘new clean renewable en-
ergy bond’ means any bond issued as part of an issue if— 
‘‘(1) 100 percent of the available project proceeds 
of such issue are to be used for capital expenditures 
incurred by governmental bodies, public power pro-
viders, or cooperative electric companies for one or 
more qualified renewable energy facilities, 
‘‘(2) the bond is issued by a qualified issuer, and
‘‘(3) the issuer designates such bond for purposes 
of this section. 
‘‘(b) REDUCED CREDIT AMOUNT.—The annual credit 
determined under section 54A(b) with respect to any new 
clean renewable energy bond shall be 70 percent of the 
amount so determined without regard to this subsection. 
‘‘(c) LIMITATION
ON
AMOUNT
OF
BONDS
DES-
IGNATED.— 
‘‘(1) IN
GENERAL.—The maximum aggregate 
face amount of bonds which may be designated under 
subsection (a) by any issuer shall not exceed the limi-
tation amount allocated under this subsection to such 
issuer. 
‘‘(2) NATIONAL
LIMITATION
ON
AMOUNT
OF 
BONDS DESIGNATED.—There is a national new clean 
renewable energy bond limitation of $800,000,000 
which shall be allocated by the Secretary as provided 
in paragraph (3), except that— 
‘‘(A) not more than 331⁄3 percent thereof 
may be allocated to qualified projects of public 
power providers, 
‘‘(B) not more than 331⁄3 percent thereof 
may be allocated to qualified projects of govern-
mental bodies, and
‘‘(C) not more than 331⁄3 percent thereof 
may be allocated to qualified projects of coopera-
tive electric companies. 
‘‘(3) METHOD OF ALLOCATION.— 
‘‘(A) ALLOCATION
AMONG
PUBLIC
POWER 
PROVIDERS.—After the Secretary determines the 
qualified projects of public power providers 
which are appropriate for receiving an alloca-
tion of the national new clean renewable energy 
bond limitation, the Secretary shall, to the max-
imum 
extent 
practicable, 
make 
allocations 
among such projects in such manner that the 
amount allocated to each such project bears the 
same ratio to the cost of such project as the limi-
tation under paragraph (2)(A) bears to the cost 
of all such projects. 
‘‘(B) ALLOCATION
AMONG
GOVERNMENTAL 
BODIES
AND
COOPERATIVE
ELECTRIC
COMPA-
NIES.—The Secretary shall make allocations of 
the amount of the national new clean renewable 
energy bond limitation described in paragraphs 
(2)(B) and (2)(C) among qualified projects of 
governmental bodies and cooperative electric 
companies, respectively, in such manner as the 
Secretary determines appropriate.
‘‘(d) DEFINITIONS.—For purposes of this section— 
‘‘(1) QUALIFIED
RENEWABLE
ENERGY
FACIL-
ITY.—The term ‘qualified renewable energy facility’ 
means a qualified facility (as determined under sec-
tion 45(d) without regard to paragraphs (8) and (10) 
thereof and to any placed in service date) owned by 
a public power provider, a governmental body, or a 
cooperative electric company. 
‘‘(2) PUBLIC POWER PROVIDER.—The term ‘pub-
lic power provider’ means a State utility with a serv-
ice obligation, as such terms are defined in section 
217 of the Federal Power Act (as in effect on the date 
of the enactment of this paragraph). 
‘‘(3) GOVERNMENTAL BODY.—The term ‘govern-
mental body’ means any State or Indian tribal gov-
ernment, or any political subdivision thereof. 
‘‘(4) COOPERATIVE
ELECTRIC
COMPANY.—The 
term ‘cooperative electric company’ means a mutual 
or cooperative electric company described in section 
501(c)(12) or section 1381(a)(2)(C). 
‘‘(5) CLEAN RENEWABLE ENERGY BOND LEND-
ER.—The term ‘clean renewable energy bond lender’ 
means a lender which is a cooperative which is owned 
by, or has outstanding loans to, 100 or more coopera-
tive electric companies and is in existence on Feb-
ruary 1, 2002, and shall include any affiliated entity 
which is controlled by such lender. 
‘‘(6) QUALIFIED
ISSUER.—The term ‘qualified 
issuer’ means a public power provider, a cooperative 
electric company, a governmental body, a clean re-
newable energy bond lender, or a not-for-profit elec-
tric utility which has received a loan or loan guar-
antee under the Rural Electrification Act.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Paragraph (1) of section 54A(d) is amended 
to read as follows: 
‘‘(1) QUALIFIED TAX CREDIT BOND.—The term 
‘qualified tax credit bond’ means— 
‘‘(A) a qualified forestry conservation bond, 
or 
‘‘(B) a new clean renewable energy bond, 
which is part of an issue that meets requirements of 
paragraphs (2), (3), (4), (5), and (6).’’. 
(2) Subparagraph (C) of section 54A(d)(2) is 
amended to read as follows: 
‘‘(C) QUALIFIED
PURPOSE.—For purposes 
of this paragraph, the term ‘qualified purpose’ 
means—
‘‘(i) in the case of a qualified forestry 
conservation bond, a purpose specified in 
section 54B(e), and 
‘‘(ii) in the case of a new clean renew-
able energy bond, a purpose specified in sec-
tion 54C(a)(1).’’. 
(3) The table of sections for subpart I of part IV 
of subchapter A of chapter 1 is amended by adding 
at the end the following new item: 
‘‘Sec. 54C. Qualified clean renewable energy bonds.’’. 
(c) EXTENSION
FOR CLEAN RENEWABLE ENERGY 
BONDS.—Subsection (m) of section 54 is amended by strik-
ing ‘‘December 31, 2008’’ and inserting ‘‘December 31, 
2009’’. 
(d) EFFECTIVE DATE.—The amendments made by this 
section shall apply to obligations issued after the date of 
the enactment of this Act. 
SEC. 108. CREDIT FOR STEEL INDUSTRY FUEL. 
(a) TREATMENT AS REFINED COAL.— 
(1) IN GENERAL.—Subparagraph (A) of section 
45(c)(7) of the Internal Revenue Code of 1986 (relat-
ing to refined coal), as amended by this Act, is 
amended to read as follows: 
‘‘(A) IN GENERAL.—The term ‘refined coal’ 
means a fuel— 
‘‘(i) which—
‘‘(I) is a liquid, gaseous, or solid 
fuel produced from coal (including lig-
nite) or high carbon fly ash, including 
such fuel used as a feedstock, 
‘‘(II) is sold by the taxpayer with 
the reasonable expectation that it will 
be used for purpose of producing 
steam, 
‘‘(III) is certified by the taxpayer 
as resulting (when used in the produc-
tion of steam) in a qualified emission 
reduction, and 
‘‘(IV) is produced in such a man-
ner as to result in an increase of at 
least 50 percent in the market value of 
the refined coal (excluding any in-
crease caused by materials combined or 
added during the production process), 
as compared to the value of the feed-
stock coal, or 
‘‘(ii) which is steel industry fuel.’’. 
(2) STEEL
INDUSTRY
FUEL
DEFINED.—Para-
graph (7) of section 45(c) of such Code is amended by 
adding at the end the following new subparagraph: 
‘‘(C) STEEL INDUSTRY FUEL.—
‘‘(i) IN GENERAL.—The term ‘steel in-
dustry fuel’ means a fuel which— 
‘‘(I) is produced through a process 
of liquifying coal waste sludge and dis-
tributing it on coal, and 
‘‘(II) is used as a feedstock for the 
manufacture of coke. 
‘‘(ii) COAL WASTE SLUDGE.—The term 
‘coal waste sludge’ means the tar decanter 
sludge and related byproducts of the coking 
process, including such materials that have 
been stored in ground, in tanks and in la-
goons, that have been treated as hazardous 
wastes under applicable Federal environ-
mental rules absent liquefaction and proc-
essing with coal into a feedstock for the 
manufacture of coke.’’. 
(b) CREDIT AMOUNT.— 
(1) IN GENERAL.—Paragraph (8) of section 45(e) 
of the Internal Revenue Code of 1986 (relating to re-
fined coal production facilities) is amended by adding 
at the end the following new subparagraph 
‘‘(D) SPECIAL RULE FOR STEEL INDUSTRY 
FUEL.—
‘‘(i) IN GENERAL.—In the case of a 
taxpayer who produces steel industry fuel— 
‘‘(I) this paragraph shall be ap-
plied separately with respect to steel 
industry fuel and other refined coal, 
and 
‘‘(II) in applying this paragraph 
to steel industry fuel, the modifications 
in clause (ii) shall apply. 
‘‘(ii) MODIFICATIONS.— 
‘‘(I) CREDIT AMOUNT.—Subpara-
graph (A) shall be applied by sub-
stituting ‘$2 per barrel-of-oil equiva-
lent’ for ‘$4.375 per ton’. 
‘‘(II) CREDIT PERIOD.—In lieu of 
the 10-year period referred to in 
clauses (i) and (ii)(II) of subpara-
graph (A), the credit period shall be 
the period beginning on the later of the 
date such facility was originally placed 
in service, the date the modifications 
described in clause (iii) were placed in 
service, or October 1, 2008, and ending 
on the later of December 31, 2009, or 
the date which is 1 year after the date
such facility or the modifications de-
scribed in clause (iii) were placed in 
service. 
‘‘(III) NO PHASEOUT.—Subpara-
graph (B) shall not apply. 
‘‘(iii) MODIFICATIONS.—The modifica-
tions described in this clause are modifica-
tions to an existing facility which allow 
such facility to produce steel industry fuel. 
‘‘(iv) BARREL-OF-OIL
EQUIVALENT.— 
For purposes of this subparagraph, a bar-
rel-of-oil equivalent is the amount of steel 
industry fuel that has a Btu content of 
5,800,000 Btus.’’. 
(2) INFLATION ADJUSTMENT.—Paragraph (2) of 
section 45(b) of such Code is amended by inserting 
‘‘the $3 amount in subsection (e)(8)(D)(ii)(I),’’ after 
‘‘subsection (e)(8)(A),’’. 
(c) TERMINATION.—Paragraph (8) of section 45(d) of 
the Internal Revenue Code of 1986 (relating to refined coal 
production facility), as amended by this Act, is amended 
to read as follows: 
‘‘(8) REFINED COAL PRODUCTION FACILITY.—In 
the case of a facility that produces refined coal, the 
term ‘refined coal production facility’ means—