I 
111TH CONGRESS 
1ST SESSION H. R. 1794 
To provide incentives to reduce dependence on foreign oil. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 30, 2009 
Mr. DANIEL E. LUNGREN of California (for himself and Mr. COSTA) intro-
duced the following bill; which was referred to the Committee on Ways 
and Means, and in addition to the Committees on Science and Tech-
nology and Energy and Commerce, for a period to be subsequently deter-
mined by the Speaker, in each case for consideration of such provisions 
as fall within the jurisdiction of the committee concerned 
A BILL 
To provide incentives to reduce dependence on foreign oil. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘New Options Petro-
leum Energy Conservation Act of 2009’’. 
SEC. 2. CLIMATE NEUTRAL COMBUSTION CREDIT. 
(a) IN GENERAL.—Section 46 of the Internal Rev-
enue Code of 1986 (relating to amount of credit) is 
amended by striking ‘‘and’’ at the end of paragraph (3), 
by striking the period at the end of paragraph (4) and 
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inserting ‘‘, and’’, and by adding at the end the following 
new paragraph: 
‘‘(5) the climate neutral combustion credit.’’. 
(b) AMOUNT OF CREDIT.—Subpart E of part IV of 
subchapter A of chapter 1 of such Code (relating to rules 
for computing investment credit) is amended by inserting 
after section 48B the following new section: 
‘‘SEC. 48C. CLIMATE NEUTRAL COMBUSTION CREDIT. 
‘‘(a) IN GENERAL.—For purposes of section 46, the 
climate neutral combustion credit for any taxable year is 
an amount equal to 20 percent of the qualified investment 
for such taxable year. 
‘‘(b) QUALIFIED INVESTMENT.— 
‘‘(1) IN GENERAL.—For purposes of subsection 
(a), the qualified investment for any taxable year is 
the basis of any property placed in service by the 
taxpayer during such taxable year which is part of 
a climate neutral combustion facility— 
‘‘(A)(i) the construction, reconstruction, or 
erection of which is completed by the taxpayer, 
or 
‘‘(ii) which is acquired by the taxpayer if 
the original use of such property commences 
with the taxpayer, and 
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‘‘(B) with respect to which depreciation (or 
amortization in lieu of depreciation) is allow-
able. 
‘‘(2) SPECIAL RULE FOR CERTAIN SUBSIDIZED 
PROPERTY.—Rules similar to section 48(a)(4) shall 
apply for purposes of this section. 
‘‘(3) CERTAIN QUALIFIED PROGRESS EXPENDI-
TURES RULES MADE APPLICABLE.—Rules similar to 
the rules of subsections (c)(4) and (d) of section 46 
(as in effect on the day before the enactment of the 
Revenue Reconciliation Act of 1990) shall apply for 
purposes of this section. 
‘‘(c) CLIMATE NEUTRAL COMBUSTION FACILITY.— 
For purposes of this section, the term ‘climate neutral 
combustion facility’ means any facility which— 
‘‘(1) burns matter to produce electricity, 
‘‘(2) captures the carbon dioxide released dur-
ing combustion and uses such carbon dioxide to re-
cover hydrocarbon fuel from below ground, and 
‘‘(3) produces no atmospheric emissions of mer-
cury or greenhouse gasses and no emissions that 
form fine particulate, smog, or acid rain. 
‘‘(d) DENIAL OF DOUBLE BENEFIT.—A credit shall 
not be allowed under this section for any qualified invest-
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ment for which a credit is allowed under section 48A or 
48B.’’. 
(c) CONFORMING AMENDMENTS.— 
(1) Section 49(a)(1)(C) of such Code is amend-
ed by striking ‘‘and’’ at the end of clause (iii), by 
striking the period at the end of clause (iv) and in-
serting ‘‘, and’’, and by adding at the end the fol-
lowing new clause: 
‘‘(v) the basis of any property which 
is part of a qualifying climate neutral com-
bustion facility.’’. 
(2) The table of sections for subpart E of part 
IV of subchapter A of chapter 1 of such Code is 
amended by inserting after the item relating to sec-
tion 48B the following new item: 
‘‘Sec. 48C. Climate neutral combustion credit.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to periods after the date of the 
enactment of this Act, 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. 3. EXTENSION OF ENERGY CREDIT FOR SOLAR EN-
ERGY PROPERTY. 
Paragraph (2)(A)(i)(II) and paragraph (3)(A)(ii) of 
section 48(a) of the Internal Revenue Code of 1986 (relat-
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ing to energy credit) are each amended by striking ‘‘but 
only with respect to periods ending before January 1, 
2017’’. 
SEC. 4. EXTENSION OF CREDIT FOR RESIDENTIAL ENERGY 
EFFICIENT PROPERTY. 
Section 25D of the Internal Revenue Code of 1986 
is amended by striking subsection (g). 
SEC. 5. PRIZE PROGRAM. 
The Secretary of Energy shall establish a program 
to award a prize in the amount of $1,000,000,000 to the 
first automobile manufacturer incorporated in the United 
States to manufacture and sell in the United States 
60,000 midsized sedan automobiles which operate on gaso-
line and can travel 100 miles per gallon. 
SEC. 6. LITHIUM ION BATTERY TECHNOLOGY. 
There are authorized to be appropriated to the Sec-
retary of Energy $30,000,000 for fiscal year 2010 for the 
development of advanced lithium ion battery technology. 
SEC. 7. EXPENSING OF PROPERTY USED IN THE REFINING 
OF ETHANOL, METHANOL, AND BIODIESEL. 
(a) IN GENERAL.—Part VI of subchapter B of chap-
ter 1 of the Internal Revenue Code of 1986 (relating to 
itemized deductions for individuals and corporations) is 
amended by inserting after section 179E the following new 
section: 
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‘‘SEC. 179F. ELECTION TO EXPENSE CERTAIN PROPERTY 
USED IN REFINING ETHANOL, METHANOL, 
AND BIODIESEL. 
‘‘(a) IN GENERAL.—A taxpayer may elect to treat the 
cost of any qualified biofuel property as an expense which 
is not chargeable to capital account. Any cost so treated 
shall be allowed as a deduction for the taxable year in 
which the property is placed in service. 
‘‘(b) ELECTION.—An election under this section for 
any taxable year shall be made on the taxpayer’s return 
of the tax imposed by this chapter for the taxable year. 
Such election shall be made in such manner as the Sec-
retary may by regulations prescribe. Any election made 
under this section may not be revoked except with the con-
sent of the Secretary. 
‘‘(c) QUALIFIED BIOFUEL PROPERTY.—For purposes 
of this section— 
‘‘(1) IN GENERAL.—The term ‘qualified biofuel 
property’ means any property— 
‘‘(A) used for the refining of any biofuel, 
and 
‘‘(B) the original use of which commences 
with the taxpayer. 
‘‘(2) BIOFUEL.—The term ‘biofuel’ means 
qualified methanol or ethanol fuel (as defined in sec-
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tion 4041(b)(2)(B)) and biodiesel (as defined in sec-
tion 40A(d)). 
‘‘(d) DUAL USE PROPERTY.—In the case of any 
property which is used for the refining of any biofuel and 
for any other use, the cost of such property taken into 
account under subsection (a) shall be reduced by an 
amount which bears the same ratio to the cost of such 
property as such other uses bears to all uses of such prop-
erty. 
‘‘(e) COORDINATION WITH 50 PERCENT EXPENSING 
OF REFINERIES.—Section 179C shall not apply to any 
property taken into account under subsection (a). 
‘‘(f) RECAPTURE.—Rules similar to the rules of sec-
tion 179(d)(10) shall apply with respect to any property 
which ceases to be qualified biofuel property.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 1245(a) of such Code is amended 
by inserting ‘‘179F,’’ after ‘‘179E,’’ both places it 
appears in paragraphs (2)(C) and (3)(C). 
(2) Section 263(a)(1) of such Code is amended 
by striking ‘‘or’’ at the end of subparagraph (K), by 
striking the period at the end of subparagraph (L) 
and inserting ‘‘, or’’, and by inserting after subpara-
graph (L) the following new subparagraph: 
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