268 
and Wildlife Service, the fund efforts to strengthen and 
restore habitat that improves the ability of fish and wild-
life to adapt successfully to climate change. The funding 
made available for such purposes shall be directed toward 
the wildlife restoration fund subaccount known as the 
Wildlife Conservation and Restoration Account established 
under section 3 of the Pittman-Robertson Wildlife Res-
toration Act (16 U.S.C. 669b). Amounts deposited in the 
subaccount under this paragraph shall be available with-
out further appropriation for obligation and expenditure 
under that Act. 
‘‘(c) There are authorized to be appropriated such 
sums as are necessary to carry out this section for each 
of fiscal years 2010 through 2050. 
‘‘SEC. 818. EARLY REDUCTION CREDITS. 
‘‘(a) REGULATIONS.—Not later than 2 years after 
the date of enactment of this title, the Administrator shall 
promulgate regulations that provide for the issuance on 
a 1-time basis, certification, and use of early reduction 
credits for greenhouse gas reduction or sequestration 
projects carried out during any of calendar years 2000 
through 2010. 
‘‘(b) ELIGIBLE PROJECTS.—A greenhouse gas reduc-
tion or sequestration project shall be eligible for early re-
duction credits if the project— 
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‘‘(1) is carried out in the United States; 
‘‘(2) meets the standards contained in regula-
tions promulgated by the Administrator under sub-
section (a) that the Administrator determines to be 
applicable to the project, including consistency with 
the requirements of— 
‘‘(A) paragraphs (2) through (5) of section 
836(a), with respect to greenhouse gas reduc-
tion projects; and 
‘‘(B) section 832(a), with respect to se-
questration projects; and 
‘‘(3) was reported to a State, regional or Na-
tional registry or was otherwise accounted for in a 
manner that the Administrator determines to be le-
gitimate— 
‘‘(A) under section 1605(b) of the Energy 
Policy Act of 1992 (42 U.S.C. 13385(b)); or 
‘‘(B) to a State or regional greenhouse gas 
registry. 
‘‘(c) LIMITATION.— 
‘‘(1) IN GENERAL.—The aggregate quantity of 
early reduction credits available for greenhouse gas 
reduction or sequestration projects for the period of 
calendar years 2000 through 2009 shall not exceed 
10 percent of the tonnage limitation for calendar 
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year 2010 for emissions of greenhouse gases from 
covered entities under section 811. 
‘‘(2) NO
OTHER
EXCEEDANCE
OF
TONNAGE 
LIMITATION.—No provision of this subtitle (other 
than paragraph (1)) or any regulation promulgated 
under this subtitle authorizes the issuance or use of 
a quantity of credits greater than the annual ton-
nage limitation for emissions of greenhouse gases 
from covered entities for a calendar year. 
‘‘SEC. 819. AVOIDING SIGNIFICANT ECONOMIC HARM. 
‘‘(a) IN GENERAL.—Pursuant to the regulations pro-
mulgated under this section, the Administrator may per-
mit covered entities to use allowances in a calendar year 
before the calendar year for which the allowances were al-
located. 
‘‘(b) REGULATIONS.— 
‘‘(1) IN
GENERAL.—Not later than 3 years 
after the date of enactment of this title, the Admin-
istrator, in coordination with the Secretary of the 
Treasury, shall promulgate regulations requiring the 
continuous monitoring of the operation of the carbon 
market and the effect of that market on the econ-
omy of the United States. 
‘‘(2) REQUIREMENTS.—The regulations shall— 
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‘‘(A) establish the criteria for determining 
whether allowance prices have reached and sus-
tained a level that is causing or will cause sig-
nificant harm to the economy of the United 
States; and 
‘‘(B) take into consideration— 
‘‘(i) the obligation of the United 
States under this subtitle to stabilize 
greenhouse gas concentrations in the at-
mosphere at the safe climate level; and 
‘‘(ii) the costs of the anticipated im-
pacts of climate change in the United 
States. 
‘‘(3) PREVENTION OF ECONOMIC HARM.—If the 
Administrator determines that allowance prices have 
reached and sustained a level that is causing or will 
cause significant harm to the economy of the United 
States, the regulations shall establish a program 
under which a covered entity may use allowances in 
a calendar year before the calendar year for which 
the allowances were allocated, including— 
‘‘(A) a requirement that allowances bor-
rowed from the allocation of a future year re-
duce the allocation of allowances to the covered 
entity for the future year on a 1-to-1 basis; 
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‘‘(B) a requirement for payment of interest 
on borrowed allowances requiring the submis-
sion of additional credits upon repayment of the 
allowances equal to the product obtained by 
multiplying— 
‘‘(i) the number of years between the 
advance use of allowances by a covered en-
tity under clause (i) and the submission of 
additional credits under this clause; and 
‘‘(ii) the sum obtained by adding— 
‘‘(I) the Federal short-term rate, 
as 
defined 
pursuant 
to 
section 
1274(d)(1)(C)(i) of the Internal Rev-
enue Code of 1986; and 
‘‘(II) 2 percent; and 
‘‘(C) a limitation that in no event may a 
covered entity— 
‘‘(i) satisfy more than 10 percent of 
the obligation of the covered entity under 
section 821(a) to surrender allowances by 
submitting allowances in a calendar year 
before the calendar year for which the al-
lowances were allocated; and 
‘‘(ii) use allowances in a calendar year 
that is more than 3 years before the cal-
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endar year for which the allowances were 
allocated; and 
‘‘SEC. 820. USE AND TRANSFER OF CREDITS. 
‘‘(a) USE IN OTHER GREENHOUSE GAS ALLOWANCE 
TRADING PROGRAMS.— 
‘‘(1) IN
GENERAL.—A credit obtained under 
this subtitle may be used in any other greenhouse 
gas allowance trading program, including a program 
of 1 or more States or subdivisions of States, that 
is approved by the Administrator and an authorized 
official for the other program for use of the allow-
ance. 
‘‘(2) RECIPROCITY.—A credit obtained from an-
other greenhouse gas trading program, including a 
program of 1 or more States or subdivisions of 
States, that is approved by the Administrator and 
an authorized official for the other program may be 
used in the trading program under this title. 
‘‘(b) ALLOWANCE USE BEFORE APPLICABLE CAL-
ENDAR YEAR.—Except as provided in section 819, an al-
lowance auctioned or allocated under this subtitle may not 
be used before the calendar year for which the allowance 
was auctioned or allocated. 
‘‘(c) TRANSFER.— 
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‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), the transfer of a credit shall not take ef-
fect until receipt and recording by the Administrator 
of a written certification of the transfer that is exe-
cuted by an authorized official of the person making 
the transfer. 
‘‘(2) SPECIAL RULE FOR ALLOWANCES.—Not-
withstanding paragraph (1), the transfer of an al-
lowance auctioned or allocated under this subtitle 
may take effect before the calendar year for which 
the allowance was auctioned or allocated. 
‘‘(d) BANKING OF CREDITS.—Any covered entity may 
use a credit obtained under this subtitle in the calendar 
year for which the credit was auctioned or allocated, or 
in a subsequent calendar year, to demonstrate compliance 
with section 821. 
‘‘(e) LIMITATIONS ON THE USE OF OFFSET CRED-
ITS.—The owner of each covered entity may not satisfy 
more than 10 percent of the obligation of the covered enti-
ty under section 821(a) by submitting offset credits. The 
Administrator may modify the maximum allowable offset 
credits that a covered entity may use to demonstrate com-
pliance with section 821(a). In evaluating this determina-
tion, the Administrator shall take into consideration: 
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‘‘(1) technological capability to reduce green-
house gas emissions; and 
‘‘(2) the economic impacts within the United 
States of allowing covered entities to submit a fewer 
or greater number of offset credits, including im-
pacts on the major emitting sectors. 
‘‘SEC. 821. COMPLIANCE AND ENFORCEMENT. 
‘‘(a) IN GENERAL.—For calendar year 2010 and 
each calendar year thereafter, the owner of each covered 
entity shall surrender to the Administrator a quantity of 
credits that is equal to the total tons of carbon dioxide 
or, with respect to other greenhouse gases, tons in carbon 
dioxide equivalent, emitted by a covered entity during a 
calendar year. 
‘‘(b) REGULATIONS.—Not later than 2 years after 
the date of enactment of this title, the Administrator shall 
promulgate regulations establishing the procedures for the 
surrender of credits. 
‘‘(c) PENALTY.—The owner of a covered entity that 
emits greenhouse gases in excess of the number of credits 
that the owner of the covered entity holds for use of the 
covered entity for the calendar year shall— 
‘‘(1) submit to the Administrator 1.3 credits for 
each metric ton of excess greenhouse gas emissions 
of the covered entity; and 
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‘‘(2) pay an excess emissions penalty equal to 
the product obtained by multiplying— 
‘‘(A) the number of tons of carbon dioxide, 
or the carbon dioxide equivalent of other green-
house gases, emitted in excess of the total 
quantity of credits held by the covered entity; 
and 
‘‘(B)(i) except as provided in clause (ii), 
$100, as adjusted for changes beginning on 
January 1, 2007, in accordance with the Con-
sumer Price Index for All-Urban Consumers 
published by the Department of Labor; or 
‘‘(ii) if the average market price for a met-
ric ton of carbon dioxide equivalent during a 
calendar year exceeds $60, $200, as adjusted 
for changes beginning on January 1, 2007, in 
accordance with the Consumer Price Index for 
All-Urban Consumers published by the Depart-
ment of Labor. 
‘‘SEC. 822. EQUALIZING THE TREATMENT OF DOMESTIC 
AND 
IMPORTED 
INDUSTRIAL 
PRODUCTS 
SOLD IN THE UNITED STATES. 
‘‘(a) FINDINGS.—Congress finds that— 
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‘‘(1) Greenhouse gas emission reductions from 
industry sectors are necessary to protect from dan-
gerous climate change— 
‘‘(A) human, animal, and plant life and 
health in the United States; and 
‘‘(B) the environment in the United States; 
and 
‘‘(2) the environmental and natural resource 
protections described in paragraph (1) would be un-
dermined if manufacturing of industry sector prod-
ucts shifted to locations outside the United States 
without comparable limits on greenhouse gas emis-
sions. 
‘‘(b) EQUALIZE TREATMENT FOR ENERGY INTEN-
SIVE PRODUCTS.—Not later than December 31, 2008, the 
Administrator, in consultation with the United States 
Trade Representative, the Secretary of State, and the Sec-
retary of Commerce, shall consider ways to establish equal 
treatment, with respect to greenhouse gas emissions, of 
domestic and imported industrial products sold in the 
United States. Not later than December 31, 2011, the Ad-
ministrator shall begin to implement policies and rec-
ommend to Congress regulatory mechanisms that would 
assure that energy intensive materials sold into United 
States commerce, of domestic and foreign origin, are man-
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ufactured according to minimum performance standards 
with respect to the greenhouse gas emissions produced per 
ton of material produced. 
‘‘(c) CONSULTATION.—In developing policies and rec-
ommendations under this section, the Administrator shall 
consult with other government entities within and outside 
the United States having programs for control of green-
house gas emissions from the manufacturing sector. 
‘‘(d) CONSIDERATIONS.—In developing policies and 
recommendations under this section, the Administrator, in 
consultation with the United States Trade Representative, 
the Secretary of State, and the Secretary of Commerce, 
shall consider— 
‘‘(1) the principle of equal treatment of domes-
tic and imported industrial products sold in the 
United States; 
‘‘(2) the need to sustain United States natural 
resources for use by future generations; 
‘‘(3) the distinction between foreign manufac-
turers from countries with regulation of greenhouse 
gases comparable to this title, and foreign manufac-
turers from countries without such comparable regu-
lation; 
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‘‘(4) the obligations of the United States and 
other countries under applicable treaties and trade 
agreements; and 
‘‘(5) such other factors as the Administrator, in 
consultation with the United States Trade Rep-
resentative, the Secretary of State, and the Sec-
retary of Commerce, determines to be relevant and 
appropriate. 
‘‘(e) INTERNATIONAL TRADE AGREEMENTS.—The 
United States Trade Representative shall negotiate trade 
agreements that are consistent with the standards regu-
lated under this section. 
‘‘Subtitle B—Offset Credits 
‘‘SEC. 831. OUTREACH INITIATIVE ON REVENUE ENHANCE-
MENT FOR AGRICULTURAL PRODUCERS. 
‘‘(a) PURPOSES.—The purposes of this subtitle are 
to achieve climate benefits, reduce overall costs to the 
United States economy, and enhance revenue for domestic 
agricultural producers, foresters, and other landowners 
by— 
‘‘(1) establishing procedures by which domestic 
agricultural producers, foresters, and other land-
owners can measure and report reductions in green-
house gas emissions and increases in sequestration; 
and 
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‘‘(2) publishing a handbook of guidance for do-
mestic agricultural producers, foresters, and other 
landowners to market emission reductions to compa-
nies. 
‘‘(b) ESTABLISHMENT.—The Secretary of Agri-
culture, acting through the Chief of the Natural Resources 
Conservation Service, the Chief of the Forest Service, the 
Administrator of the Cooperative State Research, Edu-
cation, and Extension Service, and land-grant colleges and 
universities, in consultation with the Administrator and 
the heads of other appropriate departments and agencies, 
shall establish an outreach initiative to provide informa-
tion to agricultural producers, agricultural organizations, 
foresters, and other landowners about opportunities under 
this subtitle to earn new revenue. 
‘‘(c) COMPONENTS.—The initiative under this sec-
tion— 
‘‘(1) shall be designed to ensure that, to the 
maximum extent practicable, agricultural organiza-
tions and individual agricultural producers, for-
esters, and other landowners receive detailed prac-
tical information about— 
‘‘(A) opportunities to earn new revenue 
under this subtitle; 
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‘‘(B) measurement protocols, monitoring, 
verifying, inventorying, registering, insuring, 
and marketing offsets under this title; 
‘‘(C) emerging domestic markets for en-
ergy crops, allowances, and offsets; and 
‘‘(D) local, regional, and national data-
bases and aggregation networks to facilitate 
achievement, measurement, registration, and 
sales of offsets; 
‘‘(2) shall provide— 
‘‘(A) outreach materials, including the 
handbook published under subsection (d)(1), to 
interested parties; 
‘‘(B) workshops; and 
‘‘(C) technical assistance; and 
‘‘(3) may include the creation and development 
of regional marketing centers or coordination with 
existing centers (including centers within the Nat-
ural Resources Conservation Service or the Coopera-
tive State Research, Education, and Extension Serv-
ice or at land-grant colleges and universities). 
‘‘(d) HANDBOOK.— 
‘‘(1) IN
GENERAL.—Not later than 2 years 
after the date of enactment of this title, the Sec-
retary of Agriculture, in consultation with the Ad-
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ministrator and after public input, shall publish a 
handbook for use by agricultural producers, agricul-
tural cooperatives, foresters, other landowners, offset 
buyers, and other stakeholders that provides easy-to- 
use guidance on achieving, reporting, registering, 
and marketing offsets. 
‘‘(2) DISTRIBUTION.—The Secretary of Agri-
culture shall ensure, to the maximum extent prac-
ticable, that the handbook is distributed widely 
through land-grant colleges and universities and 
other appropriate institutions. 
‘‘SEC. 832. OFFSET MEASUREMENT FOR AGRICULTURAL, 
FORESTRY, WETLANDS, AND OTHER LAND 
USE-RELATED SEQUESTRATION PROJECTS. 
‘‘(a) IN GENERAL.—Not later than 2 years after the 
date of enactment of this title, the Secretary of Agri-
culture, in consultation with the Administrator, shall pro-
mulgate regulations establishing the requirements regard-
ing the issuance, certification, and use of offset credits for 
greenhouse gas reductions from agricultural, forestry, wet-
lands, and other land use-related sequestration projects, 
including requirements— 
‘‘(1) for a region-specific discount factor for 
business-as-usual practices for specific types of se-
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questration projects, in accordance with subsection 
(c); 
‘‘(2) that ensure that the reductions are real, 
additional, verifiable, and enforceable; 
‘‘(3) that address leakage; 
‘‘(4) that the reductions are not otherwise re-
quired by any law (including a regulation) or other 
legally binding requirement; 
‘‘(5) for the quantification, monitoring, report-
ing, and verification of the reductions; 
‘‘(6) that ensure that offset credits are limited 
in duration to the period of sequestration of green-
house gases, and rectify any loss of sequestration 
other than a loss caused by an error in calculation 
identified under this subtitle, by requiring the sub-
mission of additional credits of an equivalent quan-
tity to the lost sequestration; and 
‘‘(7) that quantify sequestration flow. 
‘‘(b) ELIGIBILITY TO CREATE OFFSET CREDITS.— 
A sequestration project that commences operation on or 
after January 1, 2010, is eligible to create offset credits 
under this subtitle if the sequestration project satisfies the 
other applicable requirements of this subtitle. 
‘‘(c) DISCOUNTING FOR BUSINESS-AS-USUAL PRAC-
TICES.— 
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‘‘(1) IN GENERAL.—In order to streamline the 
availability of offset credits for agricultural and 
other land use-related sequestration projects, the 
regulations promulgated under subsection (a) shall 
provide for the calculation and reporting of region- 
specific discount factors by the Secretary of Agri-
culture— 
‘‘(A) to be used by developers of agricul-
tural projects and other land use-related se-
questration projects; and 
‘‘(B) to account for business-as-usual prac-
tices for specific types of sequestration projects. 
‘‘(2) CALCULATION.—Unless otherwise provided 
in this subtitle, the region-specific discount factor 
for business-as-usual practices for sequestration 
projects shall be calculated by dividing— 
‘‘(A) the difference between— 
‘‘(i) the quantity of greenhouse gases 
sequestered in the region as a result of the 
offset practice under this subtitle; and 
‘‘(ii) the quantity of greenhouse gases 
sequestered in the region as a result of the 
projected business-as-usual implementation 
of the applicable offset practice; by 
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‘‘(B) the quantity of greenhouse gases se-
questered in the region as a result of the offset 
practice under this subtitle. 
‘‘(3) REQUIREMENTS.— 
‘‘(A) IN GENERAL.—The regulations pro-
mulgated under this section shall, to the max-
imum extent practicable— 
‘‘(i) define geographic regions with 
reference to land that has similar agricul-
tural characteristics; and 
‘‘(ii) subject to subparagraph (B), de-
fine baseline historical reference periods 
for each category of sequestration practice, 
using the most recent period of sufficient 
length for which there are reasonably com-
prehensive data available. 
‘‘(B) EXCEPTION.—If the Secretary of Ag-
riculture determines that entities have increased 
implementation of the relevant offset practice 
during the most recent period in anticipation of 
legislation granting credit for the offsets, the 
regulations described in subparagraph (A)(ii) 
may define baseline historical reference periods 
for each category of sequestration practice 
using an earlier period. 
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‘‘(d) QUANTIFYING SEQUESTRATION FLOW.—The 
regulations that quantify sequestration flow shall in-
clude— 
‘‘(1) a default rate of sequestration flow, re-
gionally specific to the maximum extent practicable, 
for each offset practice or combination of offset 
practices, that is estimated conservatively to allow 
for site-specific variations and data uncertainties; 
‘‘(2) a downward adjustment factor for any off-
set practice or combination of practices for which, in 
the judgment of the Secretary of Agriculture, there 
are substantial uncertainties in the sequestration 
flows estimated in paragraph (1), but still reason-
ably sufficient data to calculate a default rate of 
flow; and 
‘‘(3) OFFSET
PRACTICE.—or project-specific 
measurement, monitoring, and verification require-
ments for— 
‘‘(A) offset practices or projects for which 
there are insufficiently reliable data to calculate 
a default rate of sequestration flow; or 
‘‘(B) projects for which the project pro-
ponent chooses to use project-specific require-
ments. 
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‘‘(e) USE OF NATIVE PLANT SPECIES IN OFFSET 
PROJECTS.—Not later than 18 months after the date of 
enactment of this title, the Administrator, in consultation 
with the Secretary of Agriculture, shall promulgate regula-
tions for selection, use, and storage of native and non-
native plant materials in the offset projects described in 
paragraph (2)— 
‘‘(1) to ensure native plant materials are given 
primary consideration, in accordance with applicable 
Department of Agriculture guidance for use of na-
tive plant materials; 
‘‘(2) to prohibit the use of Federal or State-des-
ignated noxious weeds; and 
‘‘(3) to prohibit the use of a species listed by 
a regional or State invasive plant council within the 
applicable region or State. 
‘‘SEC. 833. OFFSET CREDITS FROM GREENHOUSE GAS EMIS-
SIONS REDUCTION PROJECTS. 
‘‘(a) IN GENERAL.—Not later than 2 years after the 
date of enactment of this title, the Administrator shall 
promulgate regulations establishing the requirements re-
garding the issuance, certification, and use of offset cred-
its for greenhouse gas emissions reduction offset projects, 
including requirements— 
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‘‘(1) for performance standards for specific 
types of offset projects, which represent significant 
improvements compared to recent practices in the 
geographic area, to be reviewed, and updated if the 
Administrator determines updating is appropriate, 
every 5 years; 
‘‘(2) that ensure that the reductions are real, 
additional, verifiable, enforceable, and permanent; 
‘‘(3) that address leakage; 
‘‘(4) that the reductions are not otherwise re-
quired by any law (including a regulation) or other 
legally binding requirement; 
‘‘(5) for the quantification, monitoring, report-
ing, and verification of the reductions; and 
‘‘(6) that specify the duration of offset credits 
for greenhouse gas emissions reduction projects 
under this section. 
‘‘(b) ELIGIBILITY TO CREATE OFFSET CREDITS.— 
Greenhouse gas emissions reduction offset projects that 
commence operation on or after January 1, 2007, are eli-
gible to create offset credits under this subtitle if the 
projects satisfy the other applicable requirements of this 
subtitle. 
‘‘(c) CREATION
OF ADDITIONAL CATEGORIES
OF 
GREENHOUSE
GAS
EMISSIONS
REDUCTION
OFFSET 
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PROJECTS.—The Administrator may, by regulation, cre-
ate additional categories of greenhouse gas emissions re-
duction offset projects for types of projects for which the 
Administrator determines that compliance with the regula-
tions promulgated under subsection (a) is feasible. 
‘‘(d) PROHIBITION ON USE.—Notwithstanding the 
eligibility of greenhouse gas emission reduction projects to 
create offset credits in accordance with subsection (d), 
greenhouse gas emissions reduction offset projects shall 
not be eligible to create offset credits for use under this 
section beginning on the date on which the reductions are 
required by law (including regulations) or other legally 
binding requirement. 
‘‘SEC. 834. BORROWING AT PROGRAM START-UP BASED ON 
CONTRACTS TO PURCHASE OFFSET CREDITS. 
‘‘(a) IN GENERAL.—During calendar years 2011, 
2012, and 2013, a covered entity may satisfy not more 
than 5 percent of the allowance submission requirements 
of section 822 by submitting to the Administrator contrac-
tual commitments to purchase offset credits that will im-
plement an equivalent quantity of emission reductions or 
sequestration not later than December 31, 2015. 
‘‘(b) 
APPROVAL
OF
QUALIFYING
OFFSET 
PROJECTS.—Offset projects that may be appropriately 
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carried out under this section shall be approved by the 
Administrator in accordance with this subtitle. 
‘‘(c) REPAYMENT BY 2015.— 
‘‘(1) IN
GENERAL.—If a covered entity uses 
subsection (a) to comply with section 822, not later 
than the deadline in that section for allowance sub-
missions for calendar year 2015, the covered entity 
shall submit additional credits of a quantity equiva-
lent to the sum obtained by adding— 
‘‘(A) the value of credits submitted to com-
ply with credit submission requirements de-
scribed in subsection (a); and 
‘‘(B) interest calculated in accordance with 
paragraph (2). 
‘‘(2) INTEREST.—Interest referred to in para-
graph (1)(B) shall be equal to the product obtained 
by multiplying— 
‘‘(A) the number of years between— 
‘‘(i) the use by a covered entity of the 
method of compliance described in sub-
section (a); and 
‘‘(ii) the submission by the covered 
entity of additional credits under this sub-
section; and 
‘‘(B) the sum obtained by adding— 
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‘‘(i) the Federal short-term rate, as 
defined 
pursuant 
to 
section 
1274(d)(1)(C)(i) of the Internal Revenue 
Code of 1986; and 
‘‘(ii) 2 percent. 
‘‘SEC. 835. REVIEW AND CORRECTION OF ACCOUNTING FOR 
OFFSET CREDITS. 
‘‘(a) DUTY TO MONITOR.—The Secretary of Agri-
culture and the Administrator shall monitor regularly 
whether offset credits under the respective jurisdiction of 
each agency head under this subtitle are being awarded 
only for real and additional sequestration of greenhouse 
gases and reductions in greenhouse gas emissions, includ-
ing— 
‘‘(1) the accuracy of default calculations of se-
questration flow and greenhouse gas emission reduc-
tions achieved by the use of offset practices; 
‘‘(2) the calculation of region-specific discount 
factors; and 
‘‘(3) the accuracy of leakage calculations. 
‘‘(b) PERIODIC REVIEW.—Not later than December 
31, 2013, and every 5 years thereafter, the Secretary of 
Agriculture and the Administrator shall review the 
issuance of offset credits under the respective jurisdiction 
of each agency head under this subtitle to determine— 
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‘‘(1) whether offset credits are being awarded 
only for real and additional sequestration of green-
house gases or reductions in greenhouse gas emis-
sions, as described in subsection (a); 
‘‘(2) the amount of excessive award of any off-
set credits; 
‘‘(3) the volume of offset credits that have been 
or are expected to be approved; 
‘‘(4) the impact of the offset credits on market 
prices; and 
‘‘(5) the impact of the offset credits on the tra-
jectory of emissions from covered entities. 
‘‘(c) DUTY TO CORRECT.—If the Secretary of Agri-
culture or the Administrator determines that offset credits 
under the respective jurisdictions of the agency head have 
been awarded under this subtitle in excess of real and ad-
ditional sequestration of greenhouse gases or reductions 
in emissions of greenhouse gases, the Secretary of Agri-
culture or the Administrator shall— 
‘‘(1) promptly correct on a prospective basis the 
sources of the errors, including correcting leakage 
factors, region-specific discount factors, default rates 
of sequestration flow, and other relevant information 
for the offset practices involved; and 
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‘‘(2) quantify and publicly disclose the quantity 
of offset credits that have been awarded in excess of 
real and additional sequestration or emissions reduc-
tions. 
‘‘Subtitle C—National Registry for 
Credits 
‘‘SEC. 841. ESTABLISHMENT AND OPERATION OF NATIONAL 
REGISTRY. 
‘‘(a) IN GENERAL.—Except as provided in subsection 
(b), not later than July 1 of the year immediately prior 
to the first calendar year in which an annual tonnage limi-
tation on the emission of greenhouse gases applies under 
section 811(b), the Administrator shall promulgate regula-
tions to establish, operate, and maintain a national reg-
istry through which the Administrator shall— 
‘‘(1) record allocations of allowances and the 
issuance of offset credits or early reduction credits; 
‘‘(2) track transfers of credits; 
‘‘(3) retire all credits used for compliance; 
‘‘(4) subject to subsection (b), maintain trans-
parent availability of registry information to the 
public, including the quarterly reports submitted 
under section 842(a); 
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‘‘(5) prepare an annual assessment of the emis-
sion data in the quarterly reports submitted under 
section 842(a); and 
‘‘(6) take such action as is necessary to main-
tain the integrity of the registry, including adjust-
ments to correct for— 
‘‘(A) errors or omissions in the reporting 
of data; and 
‘‘(B) the prevention of counterfeiting, dou-
ble-counting, multiple registrations, multiple 
sales, and multiple retirements of credits. 
‘‘(b) EXCEPTION
TO
PUBLIC
AVAILABILITY
OF 
DATA.— 
‘‘(1) IN GENERAL.—Subsection (a)(4) shall not 
apply in any case in which the Administrator, in 
consultation with the Secretary of Defense, deter-
mines that publishing or otherwise making available 
information in accordance with that paragraph poses 
a risk to national security. 
‘‘(2) STATEMENT OF REASONS.—In a case de-
scribed in paragraph (1), the Administrator shall 
publish a description of the determination and the 
reasons for the determination. 
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‘‘SEC. 842. MONITORING AND REPORTING. 
‘‘(a) REQUIREMENTS.—Each owner or operator of a 
covered entity, or to the extent applicable, the greenhouse 
gas authorized account representative for the covered enti-
ty, shall— 
‘‘(1) comply with the monitoring, record-
keeping, and reporting requirements of part 75 of 
title 40, Code of Federal Regulations (or successor 
regulations); and 
‘‘(2) submit to the Administrator electronic 
quarterly reports that describe the greenhouse gas 
mass emission data, fuel input data, and electricity 
output data for the covered entity. 
‘‘(b) BIOMASS COFIRING.—Not later than 18 months 
after the date of enactment of this title, the Administrator 
shall promulgate regulations that provide monitoring, rec-
ordkeeping, and reporting requirements for biomass co-
firing at covered entities.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) FEDERAL ENFORCEMENT.—Section 113 of 
the Clean Air Act (42 U.S.C. 7413) is amended— 
(A) in subsection (a)(3), by striking or title 
VI,‘‘ and inserting title VI, or title VII,’’; 
(B) in subsection (b)— 
(i) by redesignating paragraphs (1) 
through (3) as subparagraphs (A) through 
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(C), respectively, and indenting the sub-
paragraphs appropriately; 
(ii) by striking ‘‘The Administrator 
shall’’ and inserting the following: 
‘‘(1) IN GENERAL.—The Administrator shall’’; 
(iii) in paragraph (1) (as designated 
by clause (ii)), in the matter preceding 
subparagraph (A) (as redesignated by 
clause (i)), by striking ‘‘or a major sta-
tionary source’’ and inserting ‘‘a major 
stationary source, or a covered entity 
under title VII’’; and 
(iv) in subparagraph (B) (as redesig-
nated by clause (i)), by striking ‘‘or title 
VI’’ and inserting ‘‘title VI, or title VII’’; 
(v) in the matter following subpara-
graph (C) of paragraph (1) (as designated 
by clauses (i) and (ii))— 
(I) by striking ‘‘Any action’’ and 
inserting the following: 
‘‘(2) JUDICIAL ENFORCEMENT.— 
‘‘(A) IN GENERAL.—Any action’’; 
(II) by striking ‘‘Notice’’ and in-
serting the following: 
‘‘(B) NOTICE.—Notice’’; and 
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(III) by striking ‘‘In the case’’ 
and inserting the following: 
‘‘(C) ACTIONS
BROUGHT
BY
ADMINIS-
TRATOR.—In the case’’; 
(C) in subsection (c)— 
(i) in the first sentence of paragraph 
(1), by striking ‘‘or title VI (relating to 
stratospheric ozone control),’’ and insert-
ing ‘‘title VI (relating to stratospheric 
ozone control), or title VII (relating to 
global warming pollution emission reduc-
tions),’’; and 
(ii) in the first sentence of paragraph 
(3), by striking ‘‘or VI’’ and inserting ‘‘VI, 
or VII’’; 
(D) in subsection (d)(1)(B), by striking 
‘‘or VI’’ and inserting ‘‘VI, or VII’’; and 
(E) in subsection (f), in the first sentence, 
by striking ‘‘or VI’’ and inserting ‘‘VI, or VII’’. 
(2) INSPECTIONS, MONITORING, AND ENTRY.— 
Section 114(a) of the Clean Air Act (42 U.S.C. 
7414(a)) is amended by striking ‘‘section 112,’’ and 
all that follows through ‘‘(ii)’’ and inserting the fol-
lowing: ‘‘section 112, any regulation of solid waste 
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combustion under section 129, or any regulation of 
greenhouse gas emissions under title VII, (ii)’’. 
(3) ADMINISTRATIVE PROCEEDINGS AND JUDI-
CIAL REVIEW.—Section 307 of the Clean Air Act 
(42 U.S.C. 7607) is amended— 
(A) in subsection (a), by striking ‘‘, or sec-
tion 306’’ and inserting ‘‘section 306, or title 
VII’’; 
(B) in subsection (b)(1)— 
(i) by striking ‘‘section 111,,’’ and in-
serting ‘‘section 111,’’; 
(ii) by striking ‘‘section 120,’’ each 
place it appears and inserting ‘‘section 
120, any action under title VII,’’; and 
(iii) by striking ‘‘112,,’’ and inserting 
‘‘112,’’; and 
(C) in subsection (d)(1)— 
(i) by striking subparagraph (S); 
(ii) by redesignating the second sub-
paragraph (N) and subparagraphs (O) 
through (R) as subparagraphs (O), (P), 
(Q), (R), and (S), respectively; 
(iii) by redesignating subparagraphs 
(T) and (U) as subparagraphs (U) and 
(V), respectively; and 
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(iv) by inserting after subparagraph 
(S) (as redesignated by clause (ii)) the fol-
lowing: 
‘‘(T) the promulgation or revision of any 
regulation under title VII,’’. 
(4) UNAVAILABILITY
OF
EMISSIONS
DATA.— 
Section 412(d) of the Clean Air Act (42 U.S.C. 
7651k(d)) is amended in the first sentence— 
(A) by inserting ‘‘or title VII’’ after 
‘‘under subsection (a)’’; and 
(B) by inserting ‘‘or title VII’’ after ‘‘this 
title’’. 
Subtitle B—Climate Change 
Research Initiatives 
SEC. 
711. 
RESEARCH 
GRANTS 
THROUGH 
NATIONAL 
SCIENCE FOUNDATION. 
Section 105 of the Global Change Research Act of 
1990 (15 U.S.C. 2935) is amended— 
(1) by redesignating subsection (c) as sub-
section (d); and 
(2) by inserting after subsection (b) the fol-
lowing: 
‘‘(c) RESEARCH GRANTS.— 
‘‘(1) LIST
OF
PRIORITY
RESEARCH
AREAS.— 
The Committee shall develop a list of priority areas 
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for research and development on climate change that 
are not being adequately addressed by Federal agen-
cies. 
‘‘(2) TRANSMISSION OF LIST.—The Director of 
the Office of Science and Technology Policy shall 
submit the list developed under paragraph (1) to the 
National Science Foundation. 
‘‘(3) AUTHORIZATION
OF
APPROPRIATIONS.— 
There are authorized to be appropriated to the Na-
tional Science Foundation such sums as are nec-
essary to carry out this subsection, to be made avail-
able through the Science and Technology Policy In-
stitute, for research in the priority areas.’’. 
SEC. 712. ABRUPT CLIMATE CHANGE RESEARCH. 
(a) IN GENERAL.—The Secretary of Commerce, act-
ing through the National Oceanic and Atmospheric Ad-
ministration, shall carry out a program of scientific re-
search on abrupt climate change designed to provide time-
ly warnings of the potential likelihood, magnitude, and 
consequences of, and measures to avoid, abrupt human- 
induced climate change. 
(b) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Secretary of Com-
merce such sums as are necessary to carry out this sec-
tion. 
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301 
SEC. 713. DEVELOPMENT OF NEW MEASUREMENT TECH-
NOLOGIES. 
(a) IN GENERAL.—The Administrator of the Envi-
ronmental Protection Agency shall carry out a program 
to develop, with technical assistance from appropriate 
Federal agencies, innovative standards and measurement 
technologies to calculate greenhouse gas emissions or re-
ductions for which no accurate, reliable, low-cost measure-
ment technology exists. 
(b) ADMINISTRATION.—The program shall include 
technologies (including remote sensing technologies) to 
measure carbon changes and other greenhouse gas emis-
sions and reductions from agriculture, forestry, wetlands, 
and other land use practices. 
(c) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Administrator 
such sums as are necessary to carry out this section. 
SEC. 714. TECHNOLOGY DEVELOPMENT AND DIFFUSION. 
(a) IN GENERAL.—The Director of the National In-
stitute of Standards and Technology, acting through the 
Manufacturing Extension Partnership program, may de-
velop a program to promote the use, by small manufactur-
ers, of technologies and techniques that result in reduced 
emissions of greenhouse gases or increased sequestration 
of greenhouse gases. 
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302 
(b) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Director of the 
National Institute of Standards and Technology such 
sums as are necessary to carry out this section. 
SEC. 715. PUBLIC LAND. 
(a) IN GENERAL.—Not later than 3 years after the 
date of enactment of this Act, the Secretary of Agriculture 
and the Secretary of the Interior shall prepare a joint as-
sessment or separate assessments setting forth rec-
ommendations for increased sequestration of greenhouse 
gases and reduction of greenhouse gas emissions on public 
land that is— 
(1) managed forestland; 
(2) managed rangeland or grassland; or 
(3) protected land, including national parks and 
designated wilderness areas. 
(b) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Secretary of Agri-
culture and the Secretary of the Interior such sums as 
are necessary to carry out this section. 
SEC. 716. SEA LEVEL RISE FROM POLAR ICE SHEET MELT-
ING. 
(a) IN GENERAL.—The Secretary of Commerce, act-
ing through the National Oceanic and Atmospheric Ad-
ministration and in cooperation with the Administrator of 
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the National Aeronautics and Space Administration, shall 
carry out a program of scientific research to support mod-
eling and observations into the potential role of the Green-
land, west Antarctic, and east Antarctic ice sheets in any 
future increase in sea levels. 
(b) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Secretary of Com-
merce and the Administrator of the National Aeronautics 
and Space Administration such sums as are necessary to 
carry out this section. 
TITLE VIII—OFFSETS 
Subtitle A—Denial of Oil and Gas 
Tax Benefits 
SEC. 801. SHORT TITLE. 
This subtitle may be cited as the ‘‘Ending Subsidies 
for Big Oil Act of 2007’’. 
SEC. 802. DENIAL OF DEDUCTION FOR INCOME ATTRIB-
UTABLE TO DOMESTIC PRODUCTION OF OIL, 
NATURAL 
GAS, 
OR 
PRIMARY 
PRODUCTS 
THEREOF. 
(a) IN GENERAL.—Subparagraph (B) of section 
199(c)(4) of the Internal Revenue Code of 1986 (relating 
to exceptions) is amended by striking ‘‘or’’ at the end of 
clause (ii), by striking the period at the end of clause (iii) 
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and inserting ‘‘, or’’, and by inserting after clause (iii) the 
following new clause: 
‘‘(iv) the sale, exchange, or other dis-
position of oil, natural gas, or any primary 
product thereof.’’. 
(b) PRIMARY PRODUCT.—Section 199(c)(4)(B) of 
such Code is amended by adding at the end the following 
flush sentence: 
‘‘For purposes of clause (iv), the term ‘primary 
product’ has the same meaning as when used in 
section 927(a)(2)(C), as in effect before its re-
peal.’’. 
(c) CONFORMING AMENDMENTS.—Section 199(c)(4) 
of such Code is amended— 
(1) in subparagraph (A)(i)(III) by striking 
‘‘electricity, natural gas,’’ and inserting ‘‘electricity’’, 
and 
(2) in subparagraph (B)(ii) by striking ‘‘elec-
tricity, natural gas,’’ and inserting ‘‘electricity’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2007. 
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SEC. 803. 7-YEAR AMORTIZATION OF GEOLOGICAL AND 
GEOPHYSICAL EXPENDITURES FOR CERTAIN 
MAJOR INTEGRATED OIL COMPANIES. 
(a) IN GENERAL.—Subparagraph (A) of section 
167(h)(5) of the Internal Revenue Code of 1986 (relating 
to special rule for major integrated oil companies) is 
amended by striking ‘‘5-year’’ and inserting ‘‘7-year’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to amounts paid or incurred after 
the date of the enactment of this Act. 
Subtitle B—Royalties Under 
Offshore Oil and Gas Leases 
SEC. 811. SHORT TITLE. 
This title may be cited as the ‘‘Royalty Relief for 
American Consumers Act of 2007’’. 
SEC. 812. PRICE THRESHOLDS FOR ROYALTY SUSPENSION 
PROVISIONS. 
The Secretary of the Interior shall agree to a request 
by any lessee to amend any lease issued for any Central 
and Western Gulf of Mexico tract during the period of 
January 1, 1998, through December 31, 1999, to incor-
porate price thresholds applicable to royalty suspension 
provisions, that are equal to or less than the price thresh-
olds described in clauses (v) through (vii) of section 
8(a)(3)(C) of the Outer Continental Shelf Lands Act (43 
U.S.C. 1337(a)(3)(C)). Any amended lease shall impose 
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the new or revised price thresholds effective October 1, 
2006. Existing lease provisions shall prevail through Sep-
tember 30, 2006. 
SEC. 813. CLARIFICATION OF AUTHORITY TO IMPOSE 
PRICE THRESHOLDS FOR CERTAIN LEASE 
SALES. 
Congress reaffirms the authority of the Secretary of 
the Interior under section 8(a)(1)(H) of the Outer Conti-
nental Shelf Lands Act (43 U.S.C. 1337(a)(1)(H)) to 
vary, based on the price of production from a lease, the 
suspension of royalties under any lease subject to section 
304 of the Outer Continental Shelf Deep Water Royalty 
Relief Act (Public Law 104–58; 43 U.S.C. 1337 note). 
SEC. 814. ELIGIBILITY FOR NEW LEASES AND THE TRANS-
FER OF LEASES; CONSERVATION OF RE-
SOURCES FEES. 
(a) ISSUANCE OF NEW LEASES.— 
(1) IN
GENERAL.—The Secretary shall not 
issue any new lease that authorizes the production 
of oil or natural gas in the Gulf of Mexico under the 
Outer Continental Shelf Lands Act (43 U.S.C. 1331 
et seq.) to a person described in paragraph (2) un-
less— 
(A) the person has renegotiated each cov-
ered lease with respect to which the person is 
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a lessee, to modify the payment responsibilities 
of the person to include price thresholds that 
are equal to or less than the price thresholds 
described in clauses (v) through (vii) of section 
8(a)(3)(C) of the Outer Continental Shelf 
Lands Act (43 U.S.C. 1337(a)(3)(C)); or 
(B) the person has— 
(i) paid all fees established by the 
Secretary under subsection (b) that are 
due with respect to each covered lease for 
which the person is a lessee; or 
(ii) entered into an agreement with 
the Secretary under which the person is 
obligated to pay such fees. 
(2) PERSONS DESCRIBED.—A person referred 
to in paragraph (1) is a person that— 
(A) is a lessee that— 
(i) holds a covered lease on the date 
on which the Secretary considers the 
issuance of the new lease; or 
(ii) was issued a covered lease before 
the date of enactment of this Act, but 
transferred the covered lease to another 
person or entity (including a subsidiary or 
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