(2) by striking the period at the end of sub-
paragraph (D) and inserting ‘‘, and’’, 
(3) by inserting at the end the following: ‘‘or 
with respect to compressed or liquefied natural gas’’ 
after ‘‘subparagraph (D)’’. 
‘‘(E) any alternative fuel or alternative fuel 
mixture (as so defined) involving compressed or 
liquefied natural gas.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to fuel sold or used after the date 
of the enactment of this Act. 
SEC. 102. EXTENSION AND MODIFICATION OF ALTER-
NATIVE FUEL VEHICLE CREDIT. 
(a) IN GENERAL.—Paragraph (4) of section 30B(k) 
(relating to termination) is amended by inserting ‘‘(De-
cember 31, 2027, in the case of a vehicle powered by com-
pressed or liquefied natural gas)’’ before the period at the 
end. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to property placed in service 
after the date of the enactment of this Act. 
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SEC. 103. ALLOWANCE OF VEHICLE AND INFRASTRUCTURE 
CREDITS AGAINST REGULAR AND MINIMUM 
TAX AND TRANSFERABILITY OF CREDITS. 
(a) BUSINESS CREDITS.—Subparagraph (B) of sec-
tion 38(c)(4) is amended by striking ‘‘and’’ at the end of 
clause (vii), by striking the period at the end of clause 
(viii) and inserting ‘‘, and’’, and by inserting after clause 
(viii) the following new clauses: 
‘‘(ix) the portion of the credit deter-
mined under section 30B which is attrib-
utable to the application of subsection 
(e)(3) thereof with respect to qualified al-
ternative fuel motor vehicles which are ca-
pable of being powered by compressed or 
liquefied natural gas, and 
‘‘(x) the portion of the credit deter-
mined under section 30C which is attrib-
utable to the application of subsection (b) 
thereof with respect to refueling property 
which is used to store and or dispense 
compressed or liquefied natural gas.’’. 
(b) PERSONAL CREDITS.— 
(1) 
NEW
QUALIFIED
ALTERNATIVE
FUEL 
MOTOR VEHICLES.—Subsection (g) of section 30B is 
amended by adding at the end the following new 
paragraph: 
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‘‘(3) SPECIAL
RULE
RELATING
TO
CERTAIN 
NEW QUALIFIED ALTERNATIVE FUEL MOTOR VEHI-
CLES.—In the case of the portion of the credit deter-
mined under subsection (a) which is attributable to 
the application of subsection (e)(3) with respect to 
qualified alternative fuel motor vehicles which are 
capable of being powered by compressed or liquefied 
natural gas— 
‘‘(A) paragraph (2) shall (after the appli-
cation of paragraph (1)) be applied separately 
with respect to such portion, and 
‘‘(B) in lieu of the limitation determined 
under paragraph (2), such limitation shall not 
exceed the excess (if any) of— 
‘‘(i) the sum of the regular tax liabil-
ity (as defined in section 26(b)) plus the 
tentative minimum tax for the taxable 
year, reduced by 
‘‘(ii) the sum of the credits allowable 
under subpart A and sections 27 and 30.’’. 
(2) ALTERNATIVE FUEL VEHICLE REFUELING 
PROPERTIES.—Subsection (d) of section 30C is 
amended by adding at the end the following new 
paragraph: 
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‘‘(3) SPECIAL RULE RELATING TO CERTAIN AL-
TERNATIVE
FUEL
VEHICLE
REFUELING
PROP-
ERTIES.—In the case of the portion of the credit de-
termined under subsection (a) with respect to refuel-
ing property which is used to store and or dispense 
compressed or liquefied natural gas and which is at-
tributable to the application of subsection (b)— 
‘‘(A) paragraph (2) shall (after the appli-
cation of paragraph (1)) be applied separately 
with respect to such portion, and 
‘‘(B) in lieu of the limitation determined 
under paragraph (2), such limitation shall not 
exceed the excess (if any) of— 
‘‘(i) the sum of the regular tax liabil-
ity (as defined in section 26(b)) plus the 
tentative minimum tax for the taxable 
year, reduced by 
‘‘(ii) the sum of the credits allowable 
under subpart A and sections 27, 30, and 
the portion of the credit determined under 
section 30B which is attributable to the 
application of subsection (e)(3) thereof.’’. 
(c) CREDITS MAY BE TRANSFERRED.— 
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(1) VEHICLE CREDITS.—Subsection (h) of sec-
tion 30B is amended by adding at the end the fol-
lowing new paragraph: 
‘‘(11) TRANSFERABILITY OF CREDIT.—Nothing 
in any law or rule of law shall be construed to limit 
a taxpayer from transferring, through sale and re-
purchase agreement, the credit allowed by this sec-
tion for qualified alternative fuel motor vehicles 
which are capable of being powered by compressed 
or liquefied natural gas.’’. 
(2) INFRASTRUCTURE CREDIT.—Subsection (e) 
of section 30C is amended by adding at the end the 
following new paragraph: 
‘‘(6) CREDIT MAY BE TRANSFERRED.—Nothing 
in any law or rule of law shall be construed to limit 
a taxpayer from transferring the credit allowed by 
this section through sale and repurchase agree-
ments.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply with respect to property placed in 
service after the date of the enactment of this Act. 
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SEC. 104. MODIFICATION OF CREDIT FOR PURCHASE OF 
VEHICLES FUELED BY NATURAL GAS OR 
LIQUIFIED NATURAL GAS. 
(a) INCREASE IN CREDIT.—Paragraph (2) of section 
30B(e) (relating to applicable percentage) is amended to 
read as follows: 
‘‘(2) APPLICABLE PERCENTAGE.—For purposes 
of paragraph (1), the applicable percentage with re-
spect to any new qualified alternative fuel motor ve-
hicle is— 
‘‘(A) except as provided in subparagraphs 
(B) and (C)— 
‘‘(i) 50 percent, plus 
‘‘(ii) 30 percent, if such vehicle— 
‘‘(I) has received a certificate of 
conformity under the Clean Air Act 
and meets or exceeds the most strin-
gent standard available for certifi-
cation under the Clean Air Act for 
that make and model year vehicle 
(other than a zero emission standard), 
or 
‘‘(II) has received an order certi-
fying the vehicle as meeting the same 
requirements as vehicles which may be 
sold or leased in California and meets 
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or exceeds the most stringent stand-
ard available for certification under 
the State laws of California (enacted 
in accordance with a waiver granted 
under section 209(b) of the Clean Air 
Act) for that make and model year ve-
hicle (other than a zero emission 
standard) 
‘‘(B) 80 percent, in the case of vehicles 
that are only capable of operating on com-
pressed natural gas or liquefied natural gas, or 
mix-fuel vehicles which are capable of operating 
on compressed or liquefied natural gas, and 
‘‘(C) 50 percent, in the case of vehicles de-
scribed subsection (e)(4)(A)(i)(II). 
For purposes of the preceding sentence, in the case 
of any new qualified alternative fuel motor vehicle 
which weighs more than 14,000 pounds gross vehicle 
weight rating, the most stringent standard available 
shall be such standard available for certification on 
the date of the enactment of the Energy Tax Incen-
tives Act of 2005.’’. 
(b) HIGHER INCREMENTAL COST LIMITS FOR NAT-
URAL GAS VEHICLES.—Subsection (e) of section 30B (re-
lating to new qualified alternative motor vehicle credit) is 
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amended by adding at the end the following new para-
graph: 
‘‘(6) HIGHER INCREMENTAL COST LIMITS FOR 
NATURAL GAS VEHICLES.—In the case of alternative 
fueled motor vehicles with respect to vehicles pow-
ered by compressed or liquefied natural gas, para-
graph (3) shall be applied— 
‘‘(A) in subparagraph (A) by substituting 
‘$12,500’ for ‘$5,000’, 
‘‘(B) in subparagraph (B) by substituting 
‘$20,000’ for ‘$10,000’, 
‘‘(C) in subparagraph (C) by substituting 
‘$50,000’ for ‘$25,000’, and 
‘‘(D) in subparagraph (D) by substituting 
‘$80,000’ for ‘$40,000’.’’. 
(c) EFFECTIVE DATE.—The amendment made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act. 
SEC. 105. MODIFICATION OF DEFINITION OF NEW QUALI-
FIED ALTERNATIVE FUEL MOTOR VEHICLE. 
(a) IN GENERAL.—Clause (i) of section 30B(e)(4)(A) 
(relating to definition of new qualified alternative fuel 
motor vehicle) is amended to read as follows: 
‘‘(i) which— 
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‘‘(I) is only capable of operating 
on an alternative fuel, or 
‘‘(II) is capable of operating on 
compressed or liquefied natural gas 
and (but not in combination with) 
gasoline or diesel fuel, but in no case 
shall such vehicle have an operating 
range of less than 200 miles on com-
pressed or liquefied natural gas.’’. 
(b) CONVERSIONS AND REPOWERS.—Paragraph (4) 
of section 30B(e) is amended by adding at the end the 
following new subparagraph: 
‘‘(C) CONVERSIONS AND REPOWERS.— 
‘‘(i) IN
GENERAL.—The term ‘new 
qualified alternative fuel vehicle’ includes 
the conversion or repower of a new or used 
vehicle so that it is capable of operating on 
a qualified alternative fuel as it was not 
previously capable of operating on an alter-
native fuel. 
‘‘(ii) TREATMENT AS NEW.—A vehicle 
which has been converted to operate on al-
ternative fuel shall be treated as new on 
the date of such conversion for purposes of 
this section. 
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‘‘(iii) RULE
OF
CONSTRUCTION.—In 
the case of a used vehicle which is con-
verted or repowered, nothing in this section 
shall be construed to require that the 
motor vehicle be acquired in the year the 
credit is claimed under this section with re-
spect to such vehicle.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act. 
TITLE 
II—PROMOTE 
PRODUC-
TION OF NGVS BY ORIGINAL 
EQUIPMENT 
MANUFACTUR-
ERS 
SEC. 201. CREDIT FOR PRODUCING VEHICLES FUELED BY 
NATURAL GAS OR LIQUIFIED NATURAL GAS. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 (relating to business-related cred-
its) is amended by inserting after section 45Q the fol-
lowing new section: 
‘‘SEC. 45R. PRODUCTION OF VEHICLES FUELED BY NAT-
URAL GAS OR LIQUIFIED NATURAL GAS. 
‘‘(a) IN GENERAL.—For purposes of section 38, in 
the case of a taxpayer who is a manufacturer of natural 
gas vehicles, the natural gas vehicle credit determined 
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under this section for any taxable year with respect to 
each eligible natural gas vehicle produced by the taxpayer 
during such year is an amount equal to the lesser of— 
‘‘(1) 10 percent of the manufacturer’s basis in 
such vehicle, or 
‘‘(2) $4,000. 
‘‘(b) AGGREGATE CREDIT ALLOWED.—The aggre-
gate amount of credit allowed under subsection (a) with 
respect to a taxpayer for any taxable year shall not exceed 
$200,000,000 reduced by the amount of the credit allowed 
under subsection (a) to the taxpayer (or any predecessor) 
for all prior taxable years. 
‘‘(c) DEFINITIONS.—For purposes of this section— 
‘‘(1) ELIGIBLE NATURAL GAS VEHICLE.—The 
term ‘eligible natural gas vehicle’ means any motor 
vehicle (as defined in section 30(c)(2))— 
‘‘(A) which— 
‘‘(i) is only capable of operating on 
natural gas or liquefied natural gas, or 
‘‘(ii) is capable of operating on com-
pressed or liquefied natural gas and (but 
not in combination with) gasoline or diesel 
fuel, but in no case shall such vehicle have 
an operating range of less than 200 miles 
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on compressed or liquefied natural gas, 
and 
‘‘(B) the final assembly of which is in the 
United States. 
‘‘(2) MANUFACTURER.—The term ‘manufac-
turer’ has the meaning given such term in regula-
tions prescribed by the Administrator of the Envi-
ronmental Protection Agency for purposes of the ad-
ministration of title II of the Clean Air Act (42 
U.S.C. 7521 et seq.). 
‘‘(d) SPECIAL RULES.—For purposes of this sec-
tion— 
‘‘(1) IN GENERAL.—Rules similar to the rules 
of subsections (c), (d), and (e) of section 52 shall 
apply. 
‘‘(2) CONTROLLED GROUPS.— 
‘‘(A) IN GENERAL.—All persons treated as 
a single employer under subsection (a) or (b) of 
section 52 or subsection (m) or (o) of section 
414 shall be treated as a single producer. 
‘‘(B) INCLUSION
OF
FOREIGN
CORPORA-
TIONS.—For purposes of subparagraph (A), in 
applying subsections (a) and (b) of section 52 
to this section, section 1563 shall be applied 
without regard to subsection (b)(2)(C) thereof. 
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‘‘(3) VERIFICATION.—No amount shall be al-
lowed as a credit under subsection (a) with respect 
to which the taxpayer has not submitted such infor-
mation or certification as the Secretary, in consulta-
tion with the Secretary of Energy, determines nec-
essary. 
‘‘(e) TERMINATION.—This section shall not apply to 
any vehicle produced after December 31, 2017.’’. 
(b) CREDIT TO BE PART OF BUSINESS CREDIT.— 
Section 38(b) is amended by striking ‘‘plus’’ at the end 
of paragraph (34), by striking the period at the end of 
paragraph (35) and inserting ‘‘, plus’’, and by adding at 
the end the following: 
‘‘(36) the natural gas vehicle credit determined 
under section 45R(a).’’. 
(c) CONFORMING AMENDMENT.—The table of sec-
tions for subpart D of part IV of subchapter A of chapter 
1 is amended by inserting after the item relating to section 
45Q the following new item: 
‘‘Sec. 45R. Production of vehicles fueled by natural gas or liquified natural 
gas.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to vehicles produced after Decem-
ber 31, 2008. 
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TITLE III—TO INCENTIVIZE THE 
INSTALLATION OF NATURAL 
GAS FUEL PUMPS AT SERVICE 
STATIONS AND DEPOTS AND 
DOMESTIC LNG PRODUCTION 
FACILITIES FOR SMALL EN-
ERGY PRODUCERS 
SEC. 301. EXTENSION AND MODIFICATION OF ALTER-
NATIVE FUEL VEHICLE REFUELING PROP-
ERTY CREDIT. 
(a) IN GENERAL.—Subsection (g) of section 30C is 
amended by striking ‘‘and’’ at the end of paragraph (1), 
by redesignating paragraph (2) as paragraph (3), and by 
inserting after paragraph (1) the following new paragraph: 
‘‘(2) in the case of property relating to com-
pressed or liquefied natural gas, after December 31, 
2027.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to property placed in service 
after the date of the enactment of this Act. 
SEC. 302. INCREASE IN CREDIT FOR CERTAIN ALTER-
NATIVE FUEL VEHICLE REFUELING PROP-
ERTIES. 
(a) IN GENERAL.—Subsection (b) of section 30C is 
amended to read as follows: 
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‘‘(b) LIMITATION.—The credit allowed under sub-
section (a) with respect to all qualified alternative fuel ve-
hicle refueling property placed in service by the taxpayer 
during the taxable year at a location shall not exceed— 
‘‘(1) except as provided in paragraph (2), 
$30,000 in the case of a property of a character 
subject to an allowance for depreciation, 
‘‘(2) in the case of a compressed natural gas, 
or liquefied natural gas, the lesser of— 
‘‘(A) 50 percent of such cost, or 
‘‘(B) $100,000, and 
‘‘(3) $2,000 in any other case.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to property placed in service 
after the date of the enactment of this Act. 
TITLE IV—NATURAL GAS 
VEHICLES 
SEC. 401. NATURAL GAS VEHICLES IN FEDERAL FLEET. 
Not later than December 31, 2014, and thereafter, 
at least 50 percent of all new vehicles purchased or placed 
into service by the United States Government shall be ve-
hicles that are capable of operating on compressed or liq-
uefied natural gas. 
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SEC. 402. GRANTS FOR NATURAL GAS VEHICLES RESEARCH 
AND DEVELOPMENT. 
(a) IN GENERAL.—The Secretary of Energy may 
make grants to original equipment manufacturers of light 
duty and heavy duty natural gas vehicles for the develop-
ment of engines that reduce emissions, improve perform-
ance and efficiency, and lower cost. 
(b) LIMITATION.—The aggregate amount of grants 
under subsection (a) for any fiscal year shall not exceed 
$30,000,000. 
Æ 
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