I 
108TH CONGRESS 
1ST SESSION 
H. R. 804
To amend the Internal Revenue Code of 1986 to extend and modify the 
credit for electricity produced from biomass, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 13, 2003
Mr. HERGER (for himself, Mr. MATSUI, Mr. MCCRERY, Mr. OSE, Mr. KEN-
NEDY of Minnesota, and Mr. HUNTER) introduced the following bill; 
which was referred to the Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to extend 
and modify the credit for electricity produced from bio-
mass, and for other purposes.
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 ‘‘Biomass Energy Eq-
uity Act of 2003’’.
SEC. 2. CREDIT FOR ELECTRICITY PRODUCED FROM BIO-
MASS. 
(a) EXTENSION AND MODIFICATION OF PLACED-IN-
SERVICE RULES.—Paragraph (3) of section 45(c) of the 
Internal Revenue Code of 1986 is amended—
(1) by striking subparagraph (B) and inserting 
the following new subparagraph: 
‘‘(B) CLOSED-LOOP BIOMASS FACILITY.—
In the case of a facility using closed-loop bio-
mass to produce electricity, the term ‘qualified 
facility’ means any facility—
‘‘(i) owned by the taxpayer which is 
originally placed in service after December 
31, 1992, and before January 1, 2008, or 
‘‘(ii) owned by the taxpayer which is 
originally placed in service on or before 
December 31, 1992, and modified to use 
closed-loop biomass to co-fire with coal be-
fore January 1, 2008.’’, 
(2) by striking ‘‘2004’’ in subparagraph (C) 
and inserting ‘‘2008’’, and 
(3) by adding at the end the following new sub-
paragraphs: 
‘‘(D) BIOMASS FACILITIES.—In the case of 
a facility using biomass (other than closed-loop 
biomass) to produce electricity, the term ‘quali-
fied facility’ means any facility owned by the 
taxpayer which is originally placed in service be-
fore January 1, 2008. 
‘‘(E) SPECIAL RULES.—In the case of a 
qualified facility described in subparagraph 
(B)(ii) or (D)—
‘‘(i) the 10-year period referred to in 
subsection (a) shall be treated as beginning 
no earlier than the date of the enactment 
of this paragraph, 
‘‘(ii) subsection (b)(3) shall not apply 
to any such facility originally placed in 
service before January 1, 1997, and 
‘‘(iii) if such a facility is leased and 
the operator thereof is the lessee, such les-
see (and not the owner) shall be treated 
for purposes of this section as owning such 
facility.’’
(b) BIOMASS FACILITIES.—
(1) IN GENERAL.—Section 45(c)(1) of the In-
ternal Revenue Code of 1986 (defining qualified en-
ergy resources) is amended—
(A) by striking ‘‘and’’ at the end of sub-
paragraph (B),
(B) by striking the period at the end of 
subparagraph (C) and inserting ‘‘, and’’, and 
(C) by adding at the end the following new 
subparagraph: 
‘‘(D) biomass (other than closed-loop bio-
mass).’’. 
(2) BIOMASS DEFINED.—Section 45(c) of such 
Code (relating to definitions) is amended by adding 
at the end the following new paragraph: 
‘‘(5) BIOMASS.—The term ‘biomass’ means any 
solid, nonhazardous, cellulosic waste material which 
is segregated from other waste materials and which 
is derived from—
‘‘(A) any of the following forest-related re-
sources: mill residues, precommercial thinnings, 
slash, and brush, but not including old-growth 
timber (other than old-growth timber which has 
been permitted or contracted for removal by 
any appropriate Federal authority through the 
National Environmental Policy Act or by any 
appropriate State authority), 
‘‘(B) solid wood waste materials, including 
waste pallets, crates, dunnage, manufacturing 
and construction wood wastes (other than pres-
sure-treated, 
chemically-treated, 
or 
painted