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(3) within 12 months of the date the reclassification 
determination under subsection (b)(2)(A) is issued. 
In such instances the ‘current classification’ used for 
evaluating the revision of the applicable implementa-
tion plan under paragraph (3) shall be the classifica-
tion of the downwind area under this section imme-
diately prior to such reclassification. 
‘‘(5) EXTENDED DATE.—The attainment date 
extended under this subsection shall provide for at-
tainment of such national ambient air quality stand-
ard for ozone in the downwind area as expeditiously 
as practicable but no later than the date on which 
the last reductions in pollution transport necessary 
for attainment in the downwind area are required to 
be achieved by the upwind area or areas.’’. 
SEC. 1444. ENERGY PRODUCTION INCENTIVES. 
(a) IN GENERAL.—A State may provide to any enti-
ty— 
(1) a credit against any tax or fee owed to the 
State under a State law, or 
(2) any other tax incentive, 
determined by the State to be appropriate, in the amount 
calculated under and in accordance with a formula deter-
mined by the State, for production described in subsection
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(b) in the State by the entity that receives such credit or 
such incentive. 
(b) ELIGIBLE ENTITIES.—Subsection (a) shall apply 
with respect to the production in the State of— 
(1) electricity from coal mined in the State and 
used in a facility, if such production meets all appli-
cable Federal and State laws and if such facility 
uses scrubbers or other forms of clean coal tech-
nology, 
(2) electricity from a renewable source such as 
wind, solar, or biomass, or 
(3) ethanol. 
(c) EFFECT ON INTERSTATE COMMERCE.—Any ac-
tion taken by a State in accordance with this section with 
respect to a tax or fee payable, or incentive applicable, 
for any period beginning after the date of the enactment 
of this Act shall— 
(1) be considered to be a reasonable regulation 
of commerce; and 
(2) not be considered to impose an undue bur-
den on interstate commerce or to otherwise impair, 
restrain, or discriminate, against interstate com-
merce.
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SEC. 1446. REGULATION OF CERTAIN OIL USED IN TRANS-
FORMERS. 
Notwithstanding any other provision of law, or rule 
promulgated by the Environmental Protection Agency, 
vegetable oil made from soybeans and used in electric 
transformers as thermal insulation shall not be regulated 
as an oil identified under section 2(a)(1)(B) of the Edible 
Oil Regulatory Reform Act (33 U.S.C. 2720(a)(1)(B)). 
SEC. 1447. RISK ASSESSMENTS. 
Subtitle B of title XXX of the Energy Policy Act of 
1992 is amended by adding at the end the following new 
section: 
‘‘SEC. 3022. RISK ASSESSMENT. 
‘‘Federal agencies conducting assessments of risks to 
human health and the environment from energy tech-
nology, production, transport, transmission, distribution, 
storage, use, or conservation activities shall use sound and 
objective scientific practices in assessing such risks, shall 
consider the best available science (including peer reviewed 
studies), and shall include a description of the weight of 
the scientific evidence concerning such risks.’’. 
SEC. 1448. OXYGEN-FUEL. 
(a) PROGRAM.—The Secretary of Energy shall estab-
lish a program on oxygen-fuel systems. If feasible, the pro-
gram shall include renovation of at least one existing large 
unit and one existing small unit, and construction of one
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new large unit and one new small unit. Cost sharing shall 
not be required. 
(b) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Secretary for car-
rying out this section— 
(1) $100,000,000 for fiscal year 2006; 
(2) $100,000,000 for fiscal year 2007; and 
(3) $100,000,000 for fiscal year 2008. 
(c) DEFINITIONS.—For purposes of this section— 
(1) the term ‘‘large unit’’ means a unit with a 
generating capacity of 100 megawatts or more; 
(2) the term ‘‘oxygen-fuel systems’’ means sys-
tems that utilize fuel efficiency benefits of oil, gas, 
coal, and biomass combustion using substantially 
pure oxygen, with high flame temperatures and the 
exclusion of air from the boiler, in industrial or elec-
tric utility steam generating units; and 
(3) the term ‘‘small unit’’ means a unit with a 
generating capacity in the 10–50 megawatt range. 
SEC. 1449. PETROCHEMICAL AND OIL REFINERY FACILITY 
HEALTH ASSESSMENT. 
(a) ESTABLISHMENT.—The Secretary of Energy 
shall conduct a study of direct and significant health im-
pacts to persons resulting from living in proximity to pe-
trochemical and oil refinery facilities. The Secretary shall
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consult with the Director of the National Cancer Institute 
and other Federal Government bodies with expertise in the 
field it deems appropriate in the design of such study. The 
study shall be conducted according to sound and objective 
scientific practices and present the weight of the scientific 
evidence. The Secretary shall obtain scientific peer review 
of the draft study. 
(b) REPORT
TO CONGRESS.—The Secretary shall 
transmit the results of the study to Congress within 6 
months of the enactment of this section. 
(c) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Secretary for ac-
tivities under this section such sums as are necessary for 
the completion of the study. 
SEC. 1450. UNITED STATES-ISRAEL COOPERATION. 
(a) FINDINGS.—The Congress finds that— 
(1) on February 1, 1996, United States Sec-
retary of Energy Hazel R. O’Leary and Israeli Min-
ister of Energy and Infrastructure Gonen Segev 
signed the Agreement between the Department of 
Energy of the United States of America and the 
Ministry of Energy and Infrastructure of Israel Con-
cerning Energy Cooperation, to establish a frame-
work for collaboration between the United States
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and Israel in energy research and development ac-
tivities; 
(2) the Agreement entered into force in Feb-
ruary 2000; 
(3) in February 2005, the Agreement was auto-
matically renewed for one additional 5-year period 
pursuant to Article X of the Agreement; and 
(4) under the Agreement, the United States 
and Israel may cooperate in energy research and de-
velopment in a variety of alternative and advanced 
energy sectors. 
(b) REPORT TO CONGRESS.—(1) The Secretary of 
Energy shall report to the Committee on Energy and 
Commerce of the House of Representatives and the Com-
mittee on Energy and Natural Resources of the Senate 
on— 
(A) how the United States and Israel have co-
operated on energy research and development activi-
ties under the Agreement; 
(B) projects initiated pursuant to the Agree-
ment; and 
(C) plans for future cooperation and joint 
projects under the Agreement. 
(2) The report shall be submitted no later than three 
months after the date of enactment of this Act.
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(c) SENSE OF CONGRESS.—It is the sense of the Con-
gress that energy cooperation between the Governments 
of the United States and Israel is mutually beneficial in 
the development of energy technology. 
SEC. 1451. CARBON-BASED FUEL CELL DEVELOPMENT. 
(a) GRANT AUTHORITY.—The Secretary of Energy is 
authorized to make a single grant to a qualified institution 
to design and fabricate a 5-kilowatt prototype coal-based 
fuel cell with the following performance objectives: 
(1) A current density of 600 milliamps per 
square centimeter at a cell voltage of 0.8 volts. 
(2) An operating temperature range not to ex-
ceed 900 degrees celsius. 
(b) QUALIFIED INSTITUTION.—For the purposes of 
subsection (a), a qualified institution is a research-inten-
sive institution of higher education with demonstrated ex-
pertise in the development of carbon-based fuel cells allow-
ing the direct use of high sulfur content coal as fuel, and 
which has produced a laboratory-scale carbon-based fuel 
cell with a proven current density of 100 milliamps per 
square centimeter at a voltage of 0.6 volts. 
(c) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Secretary of En-
ergy for carrying out this section $850,000 for fiscal year 
2006.
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SEC. 1452. NATIONAL PRIORITY PROJECT DESIGNATION. 
(a) DEFINITIONS.—For purposes of this section: 
(1) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Energy. 
(2) DEPARTMENT.—The term ‘‘Department’’ 
means the Department of Energy. 
(b) 
DESIGNATION
OF
NATIONAL
PRIORITY 
PROJECTS.— 
(1) IN GENERAL.—There is hereby established 
the National Priority Project designation, which 
shall be evidenced by a medal bearing the inscription 
‘‘National Priority Project’’. The medal shall be of 
such design and materials and bear such additional 
inscriptions as the President may prescribe. 
(2) MAKING AND PRESENTATION OF DESIGNA-
TION.— 
(A) IN GENERAL.—The President, on the 
basis of recommendations made by the Sec-
retary, shall annually designate organizations, if 
any, that have— 
(i) advanced the field of renewable en-
ergy technology and contribute to North 
American energy independence; and 
(ii) a project that has been certified 
by the Secretary under subsection (c).
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(B) PRESENTATION.—The President shall 
designate projects with such ceremonies as the 
President may prescribe. 
(C) USE OF DESIGNATION.—An organiza-
tion that receives a designation under this sec-
tion may publicize its designation as a National 
Priority Project in its advertising. 
(D) CATEGORIES IN WHICH THE DESIGNA-
TION
MAY
BE
GIVEN.—Separate designations 
shall be made to qualifying projects in each of 
the following categories: 
(i) 
Renewable 
energy 
generation 
projects. 
(ii) Energy efficient and renewable en-
ergy building projects. 
(c) APPLICATION AND CERTIFICATION.— 
(1) SELECTION
CRITERIA.—Certification and 
selection of the projects to receive the designation 
shall be based on the following criteria: 
(A) FOR
ALL
PROJECTS.—The project 
demonstrates that it will install no less than 30 
megawatts of renewable energy generation ca-
pacity. 
(B) FOR
ENERGY
EFFICIENT
BUILDING 
AND RENEWABLE ENERGY PROJECTS.—In addi-
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tion to meeting the criteria established in sub-
paragraph (A), building projects shall— 
(i) comply with nationally recognized 
standards for high-performance, sustain-
able buildings; 
(ii) utilize whole-building integration 
of energy efficiency and environmental per-
formance design and technology, including 
advanced building controls; 
(iii) utilize renewable energy for at 
least 50 percent of its energy consumption; 
(iv) comply with applicable Energy 
Star standards; and 
(v) include at least 5,000,000 square 
feet of enclosed space. 
(2) APPLICATION.— 
(A) INITIAL APPLICATIONS.—No later than 
4 months after the date of enactment of this 
Act, and annually thereafter, the Secretary 
shall publish in the Federal Register an invita-
tion and guidelines for submitting applications, 
consistent with the provisions of this section. 
(B) CONTENTS.—The application shall de-
scribe the project, or planned project, and its
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plans to meet the criteria listed in paragraph 
(1). 
(3) CERTIFICATION.—Not later than 60 days 
after the application period described in paragraph 
(2), the Secretary shall certify projects that are rea-
sonably expected to meet the criteria described in 
paragraph (1). 
TITLE XV—ETHANOL AND 
MOTOR FUELS 
Subtitle A—General Provisions 
SEC. 1501. RENEWABLE CONTENT OF MOTOR VEHICLE 
FUEL. 
(a) IN GENERAL.—Section 211 of the Clean Air Act 
(42 U.S.C. 7545) is amended— 
(1) by redesignating subsection (o) as sub-
section (q); and 
(2) by inserting after subsection (n) the fol-
lowing: 
‘‘(o) RENEWABLE FUEL PROGRAM.— 
‘‘(1) DEFINITIONS.—In this section: 
‘‘(A) ETHANOL.—(i) The term ‘cellulosic 
biomass ethanol’ means ethanol derived from 
any lignocellulosic or hemicellulosic matter that 
is available on a renewable or recurring basis, 
including—
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‘‘(I) dedicated energy crops and trees; 
‘‘(II) wood and wood residues; 
‘‘(III) plants; 
‘‘(IV) grasses; 
‘‘(V) agricultural residues; and 
‘‘(VI) fibers. 
‘‘(ii) The term ‘waste derived ethanol’ 
means ethanol derived from— 
‘‘(I) animal wastes, including poultry 
fats and poultry wastes, and other waste 
materials; or 
‘‘(II) municipal solid waste. 
‘‘(B) RENEWABLE FUEL.— 
‘‘(i) IN GENERAL.—The term ‘renew-
able fuel’ means motor vehicle fuel that— 
‘‘(I)(aa) is produced from grain, 
starch, oilseeds, or other biomass; or 
‘‘(bb) is natural gas produced 
from a biogas source, including a 
landfill, sewage waste treatment plant, 
feedlot, or other place where decaying 
organic material is found; and 
‘‘(II) is used to replace or reduce 
the quantity of fossil fuel present in a
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fuel mixture used to operate a motor 
vehicle. 
‘‘(ii) INCLUSION.—The term ‘renew-
able fuel’ includes cellulosic biomass eth-
anol, waste derived ethanol, and biodiesel 
(as defined in section 312(f) of the Energy 
Policy Act of 1992 (42 U.S.C. 13220(f)) 
and any blending components derived from 
renewable fuel (provided that only the re-
newable fuel portion of any such blending 
component shall be considered part of the 
applicable volume under the renewable fuel 
program established by this subsection). 
‘‘(C) SMALL REFINERY.—The term ‘small 
refinery’ means a refinery for which average ag-
gregate daily crude oil throughput for the cal-
endar year (as determined by dividing the ag-
gregate throughput for the calendar year by the 
number of days in the calendar year) does not 
exceed 75,000 barrels. 
‘‘(2) RENEWABLE FUEL PROGRAM.— 
‘‘(A) IN GENERAL.—Not later than 1 year 
after the enactment of this subsection, the Ad-
ministrator shall promulgate regulations ensur-
ing that motor vehicle fuel sold or dispensed to
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consumers in the contiguous United States, on 
an annual average basis, contains the applicable 
volume of renewable fuel as specified in sub-
paragraph (B). Regardless of the date of pro-
mulgation, such regulations shall contain com-
pliance provisions for refiners, blenders, and 
importers, as appropriate, to ensure that the re-
quirements of this section are met, but shall not 
restrict where renewable fuel can be used, or 
impose any per-gallon obligation for the use of 
renewable fuel. If the Administrator does not 
promulgate such regulations, the applicable per-
centage referred to in paragraph (4), on a vol-
ume percentage of gasoline basis, shall be 2.2 
in 2005. 
‘‘(B) APPLICABLE VOLUME.— 
‘‘(i) CALENDAR YEARS 2005 THROUGH 
2012.—For the purpose of subparagraph 
(A), the applicable volume for any of cal-
endar years 2005 through 2012 shall be 
determined in accordance with the fol-
lowing table: 
Applicable volume of 
renewable fuel 
‘‘Calendar year 
(in billions of gallons) 
2005 ...................................................................................................
3.1 
2006 ...................................................................................................
3.3 
2007 ...................................................................................................
3.5 
2008 ...................................................................................................
3.8 
2009 ...................................................................................................
4.1
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Applicable volume of 
renewable fuel 
‘‘Calendar year 
(in billions of gallons) 
2010 ...................................................................................................
4.4 
2011 ...................................................................................................
4.7 
2012 ...................................................................................................
5.0 
‘‘(ii) CALENDAR
YEAR
2013
AND 
THEREAFTER.—For the purpose of sub-
paragraph (A), the applicable volume for 
calendar year 2013 and each calendar year 
thereafter shall be equal to the product ob-
tained by multiplying— 
‘‘(I) the number of gallons of 
gasoline that the Administrator esti-
mates will be sold or introduced into 
commerce in the calendar year; and 
‘‘(II) the ratio that— 
‘‘(aa) 5.0 billion gallons of 
renewable fuels; bears to 
‘‘(bb) the number of gallons 
of gasoline sold or introduced 
into commerce in calendar year 
2012. 
‘‘(3) NON-CONTIGUOUS STATE OPT-IN.—Upon 
the petition of a non-contiguous State, the Adminis-
trator may allow the renewable fuel program estab-
lished by subtitle A of title XV of the Energy Policy 
Act of 2005 to apply in such non-contiguous State
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at the same time or any time after the Adminis-
trator promulgates regulations under paragraph (2). 
The Administrator may promulgate or revise regula-
tions under paragraph (2), establish applicable per-
centages under paragraph (4), provide for the gen-
eration of credits under paragraph (6), and take 
such other actions as may be necessary to allow for 
the application of the renewable fuels program in a 
non-contiguous State. 
‘‘(4) APPLICABLE PERCENTAGES.— 
‘‘(A) PROVISION
OF
ESTIMATE
OF
VOL-
UMES OF GASOLINE SALES.—Not later than Oc-
tober 31 of each of calendar years 2005 
through 2011, the Administrator of the Energy 
Information Administration shall provide to the 
Administrator of the Environmental Protection 
Agency an estimate of the volumes of gasoline 
that will be sold or introduced into commerce in 
the United States during the following calendar 
year. 
‘‘(B) DETERMINATION
OF
APPLICABLE 
PERCENTAGES.— 
‘‘(i) IN
GENERAL.—Not later than 
November 30 of each of the calendar years 
2005 through 2011, based on the estimate
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provided under subparagraph (A), the Ad-
ministrator shall determine and publish in 
the Federal Register, with respect to the 
following calendar year, the renewable fuel 
obligation that ensures that the require-
ments of paragraph (2) are met. 
‘‘(ii) REQUIRED ELEMENTS.—The re-
newable fuel obligation determined for a 
calendar year under clause (i) shall— 
‘‘(I) be applicable to refiners, 
blenders, and importers, as appro-
priate; 
‘‘(II) be expressed in terms of a 
volume percentage of gasoline sold or 
introduced into commerce; and 
‘‘(III) subject to subparagraph 
(C)(i), consist of a single applicable 
percentage that applies to all cat-
egories of persons specified in sub-
clause (I). 
‘‘(C) ADJUSTMENTS.—In determining the 
applicable percentage for a calendar year, the 
Administrator shall make adjustments—
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‘‘(i) to prevent the imposition of re-
dundant obligations to any person specified 
in subparagraph (B)(ii)(I); and 
‘‘(ii) to account for the use of renew-
able fuel during the previous calendar year 
by small refineries that are exempt under 
paragraph (11). 
‘‘(5) EQUIVALENCY.—For the purpose of para-
graph (2), 1 gallon of either cellulosic biomass eth-
anol or waste derived ethanol— 
‘‘(A) shall be considered to be the equiva-
lent of 1.5 gallon of renewable fuel; or 
‘‘(B) if the cellulostic biomass ethanol or 
waste derived ethanol is derived from agricul-
tural residue or wood residue or is an agricul-
tural byproduct (as that term is used in section 
919 of the Energy Policy Act of 2005), shall be 
considered to be the equivalent of 2.5 gallons of 
renewable fuel. 
‘‘(6) CREDIT PROGRAM.— 
‘‘(A) IN GENERAL.—The regulations pro-
mulgated to carry out this subsection shall pro-
vide for the generation of an appropriate 
amount of credits by any person that refines, 
blends, or imports gasoline that contains a
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quantity of renewable fuel that is greater than 
the quantity required under paragraph (2). 
Such regulations shall provide for the genera-
tion of an appropriate amount of credits for 
biodiesel fuel. If a small refinery notifies the 
Administrator that it waives the exemption pro-
vided paragraph (11), the regulations shall pro-
vide for the generation of credits by the small 
refinery beginning in the year following such 
notification. 
‘‘(B) USE
OF
CREDITS.—A person that 
generates credits under subparagraph (A) may 
use the credits, or transfer all or a portion of 
the credits to another person, for the purpose 
of complying with paragraph (2). 
‘‘(C) LIFE
OF
CREDITS.—A credit gen-
erated under this paragraph shall be valid to 
show compliance— 
‘‘(i) in the calendar year in which the 
credit was generated or the next calendar 
year; or 
‘‘(ii) in the calendar year in which the 
credit was generated or next two consecu-
tive calendar years if the Administrator
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promulgates regulations under paragraph 
(7). 
‘‘(D) INABILITY TO PURCHASE SUFFICIENT 
CREDITS.—The regulations promulgated to 
carry out this subsection shall include provi-
sions allowing any person that is unable to gen-
erate or purchase sufficient credits to meet the 
requirements under paragraph (2) to carry for-
ward a renewable fuel deficit provided that, in 
the calendar year following the year in which 
the renewable fuel deficit is created, such per-
son shall achieve compliance with the renewable 
fuel requirement under paragraph (2), and shall 
generate or purchase additional renewable fuel 
credits to offset the renewable fuel deficit of the 
previous year. 
‘‘(7) SEASONAL
VARIATIONS
IN
RENEWABLE 
FUEL USE.— 
‘‘(A) STUDY.—For each of the calendar 
years 2005 through 2012, the Administrator of 
the Energy Information Administration shall 
conduct a study of renewable fuels blending to 
determine whether there are excessive seasonal 
variations in the use of renewable fuels.
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‘‘(B) REGULATION
OF
EXCESSIVE
SEA-
SONAL VARIATIONS.—If, for any calendar year, 
the Administrator of the Energy Information 
Administration, based on the study under sub-
paragraph (A), makes the determinations speci-
fied in subparagraph (C), the Administrator 
shall promulgate regulations to ensure that 35 
percent or more of the quantity of renewable 
fuels necessary to meet the requirement of 
paragraph (2) is used during each of the peri-
ods specified in subparagraph (D) of each sub-
sequent calendar year. 
‘‘(C) DETERMINATIONS.—The determina-
tions referred to in subparagraph (B) are 
that— 
‘‘(i) less than 35 percent of the quan-
tity of renewable fuels necessary to meet 
the requirement of paragraph (2) has been 
used during one of the periods specified in 
subparagraph (D) of the calendar year; 
‘‘(ii) a pattern of excessive seasonal 
variation described in clause (i) will con-
tinue in subsequent calendar years; and 
‘‘(iii) promulgating regulations or 
other requirements to impose a 35 percent
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or more seasonal use of renewable fuels 
will not prevent or interfere with the at-
tainment of national ambient air quality 
standards or significantly increase the 
price of motor fuels to the consumer. 
‘‘(D) PERIODS.—The two periods referred 
to in this paragraph are— 
‘‘(i) April through September; and 
‘‘(ii) January through March and Oc-
tober through December. 
‘‘(E) 
EXCLUSIONS.—Renewable 
fuels 
blended or consumed in 2005 in a State which 
has received a waiver under section 209(b) shall 
not be included in the study in subparagraph 
(A). 
‘‘(8) WAIVERS.— 
‘‘(A) IN GENERAL.—The Administrator, in 
consultation with the Secretary of Agriculture 
and the Secretary of Energy, may waive the re-
quirement of paragraph (2) in whole or in part 
on petition by one or more States by reducing 
the national quantity of renewable fuel required 
under this subsection— 
‘‘(i) based on a determination by the 
Administrator, after public notice and op-
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portunity for comment, that implementa-
tion of the requirement would severely 
harm the economy or environment of a 
State, a region, or the United States; or 
‘‘(ii) based on a determination by the 
Administrator, after public notice and op-
portunity for comment, that there is an in-
adequate domestic supply or distribution 
capacity to meet the requirement. 
‘‘(B) PETITIONS FOR WAIVERS.—The Ad-
ministrator, in consultation with the Secretary 
of Agriculture and the Secretary of Energy, 
shall approve or disapprove a State petition for 
a waiver of the requirement of paragraph (2) 
within 90 days after the date on which the peti-
tion is received by the Administrator. 
‘‘(C) TERMINATION OF WAIVERS.—A waiv-
er granted under subparagraph (A) shall termi-
nate after 1 year, but may be renewed by the 
Administrator after consultation with the Sec-
retary of Agriculture and the Secretary of En-
ergy. 
‘‘(9) STUDY AND WAIVER FOR INITIAL YEAR OF 
PROGRAM.—Not later than 180 days after the enact-
ment of this subsection, the Secretary of Energy
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shall complete for the Administrator a study assess-
ing whether the renewable fuels requirement under 
paragraph (2) will likely result in significant adverse 
consumer impacts in 2005, on a national, regional, 
or State basis. Such study shall evaluate renewable 
fuel supplies and prices, blendstock supplies, and 
supply and distribution system capabilities. Based 
on such study, the Secretary shall make specific rec-
ommendations to the Administrator regarding waiv-
er of the requirements of paragraph (2), in whole or 
in part, to avoid any such adverse impacts. Within 
270 days after the enactment of this subsection, the 
Administrator 
shall, 
consistent 
with 
the 
rec-
ommendations of the Secretary, waive, in whole or in 
part, the renewable fuels requirement under para-
graph (2) by reducing the national quantity of re-
newable fuel required under this subsection in 2005. 
This paragraph shall not be interpreted as limiting 
the Administrator’s authority to waive the require-
ments of paragraph (2) in whole, or in part, under 
paragraph (8) or paragraph (10), pertaining to 
waivers. 
‘‘(10) ASSESSMENT AND WAIVER.—The Admin-
istrator, in consultation with the Secretary of En-
ergy and the Secretary of Agriculture, shall evaluate
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the requirement of paragraph (2) and determine, 
prior to January 1, 2007, and prior to January 1 
of any subsequent year in which the applicable vol-
ume of renewable fuel is increased under paragraph 
(2)(B), whether the requirement of paragraph (2), 
including the applicable volume of renewable fuel 
contained in paragraph (2)(B) should remain in ef-
fect, in whole or in part, during 2007 or any year 
or years subsequent to 2007. In evaluating the re-
quirement of paragraph (2) and in making any de-
termination under this section, the Administrator 
shall consider the best available information and 
data collected by accepted methods or best available 
means regarding— 
‘‘(A) the capacity of renewable fuel pro-
ducers to supply an adequate amount of renew-
able fuel at competitive prices to fulfill the re-
quirement of paragraph (2); 
‘‘(B) the potential of the requirement of 
paragraph (2) to significantly raise the price of 
gasoline, food (excluding the net price impact 
on the requirement in paragraph (2) on com-
modities used in the production of ethanol), or 
heating oil for consumers in any significant 
area or region of the country above the price
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that would otherwise apply to such commodities 
in the absence of such requirement; 
‘‘(C) the potential of the requirement of 
paragraph (2) to interfere with the supply of 
fuel in any significant gasoline market or region 
of the country, including interference with the 
efficient operation of refiners, blenders, import-
ers, wholesale suppliers, and retail vendors of 
gasoline, and other motor fuels; and 
‘‘(D) the potential of the requirement of 
paragraph (2) to cause or promote exceedances 
of Federal, State, or local air quality standards. 
If the Administrator determines, by clear and con-
vincing information, after public notice and the op-
portunity for comment, that the requirement of 
paragraph (2) would have significant and meaning-
ful adverse impact on the supply of fuel and related 
infrastructure or on the economy, public health, or 
environment of any significant area or region of the 
country, the Administrator may waive, in whole or 
in part, the requirement of paragraph (2) in any one 
year for which the determination is made for that 
area or region of the country, except that any such 
waiver shall not have the effect of reducing the ap-
plicable volume of renewable fuel specified in para-
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graph (2)(B) with respect to any year for which the 
determination is made. In determining economic im-
pact under this paragraph, the Administrator shall 
not consider the reduced revenues available from the 
Highway Trust Fund (section 9503 of the Internal 
Revenue Code of 1986) as a result of the use of eth-
anol. 
‘‘(11) SMALL REFINERIES.— 
‘‘(A) IN
GENERAL.—The requirement of 
paragraph (2) shall not apply to small refineries 
until the first calendar year beginning more 
than 5 years after the first year set forth in the 
table in paragraph (2)(B)(i). Not later than De-
cember 31, 2007, the Secretary of Energy shall 
complete for the Administrator a study to de-
termine whether the requirement of paragraph 
(2) would impose a disproportionate economic 
hardship on small refineries. For any small re-
finery that the Secretary of Energy determines 
would experience a disproportionate economic 
hardship, the Administrator shall extend the 
small refinery exemption for such small refinery 
for no less than two additional years. 
‘‘(B) ECONOMIC HARDSHIP.—
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HR 6 PCS 
‘‘(i) EXTENSION OF EXEMPTION.—A 
small refinery may at any time petition the 
Administrator for an extension of the ex-
emption from the requirement of para-
graph (2) for the reason of dispropor-
tionate economic hardship. In evaluating a 
hardship petition, the Administrator, in 
consultation with the Secretary of Energy, 
shall consider the findings of the study in 
addition to other economic factors. 
‘‘(ii) DEADLINE FOR ACTION ON PETI-
TIONS.—The Administrator shall act on 
any petition submitted by a small refinery 
for a hardship exemption not later than 90 
days after the receipt of the petition. 
‘‘(C) CREDIT PROGRAM.—If a small refin-
ery notifies the Administrator that it waives the 
exemption provided by this Act, the regulations 
shall provide for the generation of credits by 
the small refinery beginning in the year fol-
lowing such notification. 
‘‘(D) OPT-IN
FOR
SMALL
REFINERS.—A 
small refinery shall be subject to the require-
ments of this section if it notifies the Adminis-
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HR 6 PCS 
trator that it waives the exemption under sub-
paragraph (A). 
‘‘(12) 
ETHANOL
MARKET
CONCENTRATION 
ANALYSIS.— 
‘‘(A) ANALYSIS.— 
‘‘(i) IN
GENERAL.—Not later than 
180 days after the date of enactment of 
this subsection, and annually thereafter, 
the Federal Trade Commission shall per-
form a market concentration analysis of 
the ethanol production industry using the 
Herfindahl-Hirschman Index to determine 
whether there is sufficient competition 
among industry participants to avoid price 
setting and other anticompetitive behavior. 
‘‘(ii) SCORING.—For the purpose of 
scoring 
under 
clause 
(i) 
using 
the 
Herfindahl-Hirschman 
Index, 
all 
mar-
keting arrangements among industry par-
ticipants shall be considered. 
‘‘(B) REPORT.—Not later than December 
1, 2005, and annually thereafter, the Federal 
Trade Commission shall submit to Congress 
and the Administrator a report on the results