this paragraph at any qualified facility described in 
subsection (d)(11)— 
‘‘(A) subsection (a)(1) shall be applied for 
such calendar year by substituting ‘1.9 cents’ 
for ‘1.5 cents’, and 
‘‘(B) paragraph (2) shall be applied by 
substituting ‘2005’ for ‘2002’.’’. 
(2) ADJUSTMENT
FOR
INFLATION.—Section 
45(b)(2) is amended by inserting ‘‘the 1.9 cent 
amount in paragraph (5)’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to electricity produced after the 
date of the enactment of this Act. 
TITLE III—INCENTIVES FOR 
ALTERNATIVE FUELS 
SEC. 301. TECHNOLOGY NEUTRAL DIESEL CREDIT. 
(a) IN GENERAL.—Section 40A is amended to read 
as follows: 
‘‘SEC. 40A. QUALIFIED DIESEL USED AS FUEL. 
‘‘(a) GENERAL RULE.—For purposes of section 38, 
the qualified diesel fuels credit determined under this sec-
tion for the taxable year is an amount equal to the sum 
of— 
‘‘(1) the qualified diesel mixture credit, plus 
‘‘(2) the qualified diesel credit. 
VerDate Aug 31 2005 
01:26 Jun 14, 2007
Jkt 059200
PO 00000
Frm 00026
Fmt 6652
Sfmt 6201
E:\BILLS\H2652.IH
H2652
pwalker on PROD1PC71 with BILLS
‘‘(b) DEFINITION OF QUALIFIED DIESEL MIXTURE 
CREDIT AND QUALIFIED DIESEL CREDIT.—For purposes 
of this section— 
‘‘(1) QUALIFIED DIESEL MIXTURE CREDIT.— 
‘‘(A) IN
GENERAL.—The qualified diesel 
mixture credit of any taxpayer for any taxable 
year is $1.00 for each gallon of biodiesel used 
by the taxpayer in the production of a qualified 
biodiesel mixture. 
‘‘(B) QUALIFIED DIESEL MIXTURE.—The 
term ‘qualified biodiesel mixture’ means a mix-
ture of qualified diesel and diesel fuel (as de-
fined in section 4083(a)(3)), determined with-
out regard to any use of kerosene, which— 
‘‘(i) is sold by the taxpayer producing 
such mixture to any person for use as a 
fuel, or 
‘‘(ii) is used as a fuel by the taxpayer 
producing such mixture. 
‘‘(C) SALE OR USE MUST BE IN TRADE OR 
BUSINESS, ETC.—Biodiesel used in the produc-
tion of a qualified diesel mixture shall be taken 
into account— 
VerDate Aug 31 2005 
01:26 Jun 14, 2007
Jkt 059200
PO 00000
Frm 00027
Fmt 6652
Sfmt 6201
E:\BILLS\H2652.IH
H2652
pwalker on PROD1PC71 with BILLS
‘‘(i) only if the sale or use described 
in subparagraph (B) is in a trade or busi-
ness of the taxpayer, and 
‘‘(ii) for the taxable year in which 
such sale or use occurs. 
‘‘(D) CASUAL OFF-FARM PRODUCTION NOT 
ELIGIBLE.—No credit shall be allowed under 
this section with respect to any casual off-farm 
production of a qualified diesel mixture. 
‘‘(2) BIODIESEL CREDIT.— 
‘‘(A) IN GENERAL.—The diesel credit of 
any taxpayer for any taxable year is $1.00 for 
each gallon of diesel which is not in a mixture 
with diesel fuel and which during the taxable 
year— 
‘‘(i) is used by the taxpayer as a fuel 
in a trade or business, or 
‘‘(ii) is sold by the taxpayer at retail 
to a person and placed in the fuel tank of 
such person’s vehicle. 
‘‘(B) USER CREDIT NOT TO APPLY TO DIE-
SEL SOLD AT RETAIL.—No credit shall be al-
lowed under subparagraph (A)(i) with respect 
to any diesel which was sold in a retail sale de-
scribed in subparagraph (A)(ii). 
VerDate Aug 31 2005 
01:26 Jun 14, 2007
Jkt 059200
PO 00000
Frm 00028
Fmt 6652
Sfmt 6201
E:\BILLS\H2652.IH
H2652
pwalker on PROD1PC71 with BILLS
‘‘(3) CERTIFICATION FOR DIESEL.—No credit 
shall be allowed under paragraph (1) or (2) of sub-
section (a) unless the taxpayer obtains a certification 
(in such form and manner as prescribed by the Sec-
retary) from the producer or importer of the bio-
diesel which identifies the product produced and the 
percentage of biodiesel and agri-biodiesel in the 
product. 
‘‘(4) SMALL
QUALIFIED
DIESEL
PRODUCER 
CREDIT.— 
‘‘(A) IN
GENERAL.—The small qualified 
diesel producer credit of any eligible small 
qualified diesel producer for any taxable year is 
10 cents for each gallon of qualified diesel pro-
duction of such producer. 
‘‘(B) QUALIFIED DIESEL PRODUCTION.— 
For purposes of this paragraph, the term 
‘qualified agri-biodiesel production’ means any 
qualified diesel which is produced by an eligible 
small qualified diesel producer, and which dur-
ing the taxable year— 
‘‘(i) is sold by such producer to an-
other person— 
‘‘(I) for use by such other person 
in the production of a qualified diesel 
VerDate Aug 31 2005 
01:26 Jun 14, 2007
Jkt 059200
PO 00000
Frm 00029
Fmt 6652
Sfmt 6201
E:\BILLS\H2652.IH
H2652
pwalker on PROD1PC71 with BILLS
mixture in such other person’s trade 
or business (other than casual off- 
farm production), 
‘‘(II) for use by such other per-
son as a fuel in a trade or business, 
or 
‘‘(III) who sells such qualified 
diesel at retail to another person and 
places such qualified diesel in the fuel 
tank of such other person, or 
‘‘(ii) is used or sold by such producer 
for any purpose described in clause (i). 
‘‘(C) LIMITATION.—The qualified diesel 
production of any producer for any taxable year 
shall not exceed 15,000,000 gallons. 
‘‘(c) COORDINATION WITH CREDIT AGAINST EXCISE 
TAX.—The amount of the credit determined under this 
section with respect to any biodiesel shall be properly re-
duced to take into account any benefit provided with re-
spect to such biodiesel solely by reason of the application 
of section 6426 or 6427(e). 
‘‘(d) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
‘‘(1) QUALIFIED DIESEL.— 
VerDate Aug 31 2005 
01:26 Jun 14, 2007
Jkt 059200
PO 00000
Frm 00030
Fmt 6652
Sfmt 6201
E:\BILLS\H2652.IH
H2652
pwalker on PROD1PC71 with BILLS
‘‘(A) IN
GENERAL.—The term ‘qualified 
diesel’ means any diesel made from a renewable 
source, as certified by the Secretary of Energy. 
‘‘(B) PROCEDURE FOR CERTIFICATION.— 
For purposes of subparagraph (A), not later 
than 90 days after the date on which a request 
for certification is submitted to the Secretary of 
Energy (in accordance with regulations promul-
gated by the Secretary of Energy), the Sec-
retary of Energy shall make a determination on 
such request. 
‘‘(C) TRANSITIONAL
RULE.—Any diesel 
product eligible for the credit under this section 
on the day before the date of the enactment of 
the Generating Renewable Energy and Encour-
aging Novel Technologies Act of 2007 shall be 
deemed to be qualified diesel for purposes of 
this section after such date. 
‘‘(2) MIXTURE OR BIODIESEL NOT USED AS A 
FUEL, ETC.— 
‘‘(A) MIXTURES.—If— 
‘‘(i) any credit was determined under 
this section with respect to diesel used in 
the production of any qualified diesel mix-
ture, and 
VerDate Aug 31 2005 
01:26 Jun 14, 2007
Jkt 059200
PO 00000
Frm 00031
Fmt 6652
Sfmt 6201
E:\BILLS\H2652.IH
H2652
pwalker on PROD1PC71 with BILLS