‘‘(B) the denominator of which is the lower 
heating value of the energy sources for the fa-
cility. 
‘‘(4) EFFICIENCY
BASELINE.—Not less fre-
quently than every 10 years, the Secretary, in con-
sultation with the Secretary of Energy, shall estab-
lish baseline levels with respect to the types of elec-
tric generating facilities and the measures of effi-
ciency described in paragraph (1) which a facility 
must exceed in order to meet the requirements of 
such paragraph. 
‘‘(5) COMMERCIAL
TECHNOLOGY.—The term 
‘commercial technology’ means a design that has 
been installed in and is being used in 3 or more 
projects in the United States marketplace in the 
same general application as in the electric gener-
ating facility, and has been in such use in at least 
1 of such projects for a period of at least 5 years. 
‘‘(6) CORE
DAMAGE
FREQUENCY.—The term 
‘core damage frequency’ means the likelihood that, 
given the way a reactor is designed and operated, an 
accident could cause the fuel in the reactor to be 
damaged. 
‘‘(7) LARGE
EARLY
RELEASE
FREQUENCY.— 
The term ‘large early release frequency’ means the 
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likelihood of a release into the environment of a suf-
ficiently large quantity of fission products in an 
early enough time frame to have the potential for a 
prompt fatality. 
‘‘(f) TRANSFER OF CREDIT BY CERTAIN PUBLIC EN-
TITIES.— 
‘‘(1) IN GENERAL.—If, with respect to a credit 
under subsection (a) for any taxable year— 
‘‘(A) a qualified public entity would be the 
taxpayer (but for this paragraph), and 
‘‘(B) such entity elects the application of 
this paragraph for such taxable year with re-
spect to all (or any portion specified in such 
election) of such credit, the eligible project part-
ner specified in such election, and not the quali-
fied public entity, shall be treated as the tax-
payer for purposes of this title with respect to 
such credit (or such portion thereof). 
‘‘(2) DEFINITIONS.—For purposes of this sub-
section— 
‘‘(A) QUALIFIED
PUBLIC
ENTITY.—The 
term ‘qualified public entity’ means— 
‘‘(i) a Federal, State, or local govern-
ment entity, or any political subdivision, 
agency, or instrumentality thereof, 
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‘‘(ii) a mutual or cooperative electric 
company described in section 501(c)(12) or 
1381(a)(2), or 
‘‘(iii) a not-for-profit electric utility 
which had or has received a loan or loan 
guarantee under the Rural Electrification 
Act of 1936. 
‘‘(B) ELIGIBLE PROJECT PARTNER.—The 
term ‘eligible project partner’ means any person 
who— 
‘‘(i) is responsible for, or participates 
in, the design or construction of the quali-
fied production facility to which the credit 
under subsection (a) relates, 
‘‘(ii) is a financial institution pro-
viding financing for the construction or op-
eration of such facility, or 
‘‘(iii) has an ownership interest in 
such facility. 
‘‘(3) SPECIAL RULES.— 
‘‘(A) APPLICATION TO PARTNERSHIPS.—In 
the case of a credit under subsection (a) which 
is determined at the partnership level— 
‘‘(i) for purposes of paragraph (1)(A), 
a qualified public entity shall be treated as 
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the taxpayer with respect to such entity’s 
distributive share of such credit, and 
‘‘(ii) the term ‘eligible project partner’ 
shall include any partner of the partner-
ship. 
‘‘(B) TAXABLE
YEAR
IN
WHICH
CREDIT 
TAKEN
INTO
ACCOUNT.—In the case of any 
credit (or portion thereof) with respect to which 
an election is made under paragraph (1), such 
credit shall be taken into account in the first 
taxable year of the eligible project partner end-
ing with, or after, the qualified public entity’s 
taxable year with respect to which the credit 
was determined. 
‘‘(C) TREATMENT
OF
TRANSFER
UNDER 
PRIVATE USE RULES.—For purposes of section 
141(b)(1), any benefit derived by an eligible 
project partner in connection with an election 
under this subsection shall not be taken into ac-
count as a private business use. 
‘‘(g) REGULATIONS.—Not later than 1 year after the 
date of the enactment of this section, the Secretary shall 
prescribe such regulations as may be necessary or appro-
priate to carry out the purposes of this section. Such regu-
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lations shall include a process for making eligibility certifi-
cations described in subsection (d)(1)(E).’’. 
(b) CREDIT ALLOWED AS PART OF GENERAL BUSI-
NESS CREDIT.—Section 38(b) of such Code is amended 
by striking ‘‘plus’’ at the end of paragraph (31), by strik-
ing the period at the end of paragraph (32) and inserting 
‘‘, plus’’, and by adding at the end the following new para-
graph: 
‘‘(33) the emerging energy technology produc-
tion credit determined under section 45T(a).’’. 
(c) CLERICAL AMENDMENT.—The table of sections 
for subpart D of part IV of subchapter A of chapter 1 
of such Code is amended by adding at the end the fol-
lowing new item: 
‘‘Sec. 45T. Emerging energy technology production credit.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to electricity produced and sold 
after the date of the enactment of this Act. 
SEC. 4. MODIFICATION OF ENERGY CREDIT. 
(a) ENERGY CREDIT FOR ENERGY STORAGE TECH-
NOLOGIES.— 
(1) IN GENERAL.—Section 48(a)(3)(A) of the 
Internal Revenue Code of 1986 is amended by strik-
ing ‘‘or’’ at the end of clause (vi), by adding ‘‘or’’ 
at the end of clause (vii), and by adding at the end 
the following new clause: 
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‘‘(viii) equipment which— 
‘‘(I) receives, stores, and delivers 
energy using batteries, compressed 
air, pumped hydropower, hydrogen 
storage (including hydrolysis), thermal 
energy storage, regenerative fuel cells, 
flywheels, capacitors, superconducting 
magnets, or other technologies identi-
fied by the Secretary in consultation 
with the Secretary of Energy, 
‘‘(II) has a capacity of not less 
than 5 kilowatt hours, and 
‘‘(III) receives an allocation of 
national megawatt capacity from the 
Secretary under paragraph (8) equal 
to the capacity of such equipment.’’. 
(2) 
30-PERCENT
CREDIT.—Section 
48(a)(2)(A)(i)(II) of such Code is amended by strik-
ing ‘‘paragraph (3)(A)(i)’’ and inserting ‘‘clause (i) 
or (viii) of paragraph (3)(A)’’. 
(3) NATIONAL LIMITATION RELATING TO EN-
ERGY STORAGE PROPERTY.—Section 48(a) of such 
Code is amended by adding at the end the following 
new paragraph: 
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‘‘(8) NATIONAL LIMITATION RELATING TO EN-
ERGY STORAGE PROPERTY.— 
‘‘(A) 
IN
GENERAL.—The 
aggregate 
amount of national megawatt capacity limita-
tion allocated by the Secretary to equipment de-
scribed in paragraph (3)(A)(viii) shall not ex-
ceed 10,000 megawatts. 
‘‘(B) ALLOCATION
OF
LIMITATION.—The 
Secretary shall allocate the national megawatt 
capacity limitation in such manner as the Sec-
retary may prescribe, with a focus on diversity 
of technological design. 
‘‘(C) REGULATIONS.—Not later than 6 
months after the date of the enactment of this 
paragraph, the Secretary shall prescribe such 
regulations as may be necessary or appropriate 
to carry out the purposes of this paragraph. 
Such regulations shall provide a process under 
which the Secretary, after consultation with the 
Secretary of Energy, shall allocate the national 
megawatt capacity limitation.’’. 
(b) TRANSFER
OF ENERGY CREDIT
BY CERTAIN 
PUBLIC ENTITIES.—Section 48 of such Code is amended 
by adding at the end the following new subsection: 
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‘‘(f) TRANSFER OF CREDIT BY CERTAIN PUBLIC EN-
TITIES.— 
‘‘(1) IN GENERAL.—If, with respect to a credit 
under subsection (a) for any taxable year— 
‘‘(A) a qualified public entity would be the 
taxpayer (but for this paragraph), and 
‘‘(B) such entity elects the application of 
this paragraph for such taxable year with re-
spect to all (or any portion specified in such 
election) of such credit, the eligible project part-
ner specified in such election, and not the quali-
fied public entity, shall be treated as the tax-
payer for purposes of this title with respect to 
such credit (or such portion thereof). 
‘‘(2) DEFINITIONS.—For purposes of this sub-
section— 
‘‘(A) QUALIFIED
PUBLIC
ENTITY.—The 
term ‘qualified public entity’ means— 
‘‘(i) a Federal, State, or local govern-
ment entity, or any political subdivision, 
agency, or instrumentality thereof, 
‘‘(ii) a mutual or cooperative electric 
company described in section 501(c)(12) or 
1381(a)(2), or 
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‘‘(iii) a not-for-profit electric utility 
which had or has received a loan or loan 
guarantee under the Rural Electrification 
Act of 1936. 
‘‘(B) ELIGIBLE PROJECT PARTNER.—The 
term ‘eligible project partner’ means any person 
who— 
‘‘(i) is responsible for, or participates 
in, the design or construction of the energy 
property to which the credit under sub-
section (a) relates, 
‘‘(ii) is a financial institution pro-
viding financing for the construction or op-
eration of such property, or 
‘‘(iii) has an ownership interest in 
such property. 
‘‘(3) SPECIAL RULES.— 
‘‘(A) APPLICATION TO PARTNERSHIPS.—In 
the case of a credit under subsection (a) which 
is determined at the partnership level— 
‘‘(i) for purposes of paragraph (1)(A), 
a qualified public entity shall be treated as 
the taxpayer with respect to such entity’s 
distributive share of such credit, and 
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‘‘(ii) the term ‘eligible project partner’ 
shall include any partner of the partner-
ship. 
‘‘(B) TAXABLE
YEAR
IN
WHICH
CREDIT 
TAKEN
INTO
ACCOUNT.—In the case of any 
credit (or portion thereof) with respect to which 
an election is made under paragraph (1), such 
credit shall be taken into account in the first 
taxable year of the eligible project partner end-
ing with, or after, the qualified public entity’s 
taxable year with respect to which the credit 
was determined. 
‘‘(C) TREATMENT
OF
TRANSFER
UNDER 
PRIVATE USE RULES.—For purposes of section 
141(b)(1), any benefit derived by an eligible 
project partner in connection with an election 
under this subsection shall not be taken into ac-
count as a private business use.’’. 
(c) EFFECTIVE DATE.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, 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 
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(as in effect on the day before the date of the enact-
ment of the Revenue Reconciliation Act of 1990). 
(2) TRANSFER OF ENERGY CREDIT BY CERTAIN 
PUBLIC ENTITIES.—The amendment made by sub-
section (b) shall apply to credits arising in taxable 
years ending after the date of the enactment of this 
Act. 
Æ 
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