144 
shall require and shall have provided the Secretary 
with such certifications regarding such objectives 
and use as the Secretary may require. In the case 
of metropolitan cities, urban counties, units of gen-
eral local government, and insular areas receiving 
grants, the statement of projected use of funds shall 
consist of proposed housing energy efficiency activi-
ties. In the case of States receiving grants, the state-
ment of projected use of funds shall consist of the 
method by which the States will distribute funds to 
units of general local government. 
‘‘(2) PUBLIC
PARTICIPATION.—The Secretary 
may establish requirements to ensure the public 
availability of information regarding projected use of 
grant amounts and public participation in deter-
mining such projected use. 
‘‘(e) ELIGIBLE ACTIVITIES.— 
‘‘(1) REQUIREMENT.—Amounts from a grant 
under this section may be used only to carry out ac-
tivities for single-family or multifamily housing that 
are designed to improve the energy efficiency of the 
housing so that the housing complies with the en-
ergy efficiency standard under section 604(a) of the 
Green Resources for Energy Efficient Neighbor-
hoods Act of 2008, including such activities to pro-
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vide energy for such housing from renewable 
sources, such as wind, waves, solar, biomass, and 
geothermal sources. 
‘‘(2) PREFERENCE FOR COMPLIANCE BEYOND 
MINIMUM REQUIREMENTS.—In selecting activities to 
be funded with amounts from a grant under this 
section, a grantee shall give more preference to ac-
tivities based on the extent to which the activities 
will result in compliance by the housing with the en-
hanced energy efficiency and conservation standards, 
and the green building standards, under section 
604(b) of such Act. 
‘‘(f) REPORTS.—Each grantee of a grant under this 
section for a fiscal year shall submit to the Secretary, at 
a time determined by the Secretary, a performance and 
evaluation report concerning the use of grant amounts, 
which shall contain an assessment by the grantee of the 
relationship of such use to the objectives identified in the 
grantees statement under subsection (d). 
‘‘(g) APPLICABILITY OF CDBG PROVISIONS.—Sec-
tions 109, 110, and 111 of the Housing and Community 
Development Act of 1974 (42 U.S.C. 5309, 5310, 5311) 
shall apply to assistance received under this section to the 
same extent and in the same manner that such sections 
apply to assistance received under title I of such Act. 
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‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There 
is authorized to be appropriated for grants under this sec-
tion $2,500,000,000 for fiscal year 2009 and such sums 
as may be necessary for each fiscal year thereafter.’’. 
SEC. 616. INCLUDING SUSTAINABLE DEVELOPMENT IN 
COMPREHENSIVE HOUSING AFFORDABILITY 
STRATEGIES. 
Section 105(b) of the Cranston-Gonzalez National 
Affordable Housing Act (42 U.S.C. 12705(b)) is amend-
ed— 
(1) by striking ‘‘and’’ at the end of paragraph 
(19); 
(2) by striking the period at the end of para-
graph (20) and inserting ‘‘; and’’; 
(3) and by inserting after paragraph (20) the 
following: 
‘‘(21) describe the jurisdiction’s strategies to 
encourage sustainable development for affordable 
housing, including single-family and multifamily 
housing, as measured by— 
‘‘(A) greater energy efficiency and use of 
renewable energy sources, including any strate-
gies regarding compliance with the energy effi-
ciency requirements under section 604(a) of the 
Green Resources for Energy Efficient Neigh-
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borhoods Act of 2008 and with the enhanced 
energy efficiency and conservation standards, 
and the green building standards, under section 
604(b) of such Act; 
‘‘(B) increased conservation, recycling, and 
reuse of resources; 
‘‘(C) more effective use of existing infra-
structure; 
‘‘(D) use of building materials and meth-
ods that are healthier for residents of the hous-
ing, including use of building materials that are 
free of added known carcinogens that are classi-
fied as Group 1 Known Carcinogens by the 
International Agency for Research on Cancer; 
and 
‘‘(E) such other criteria as the Secretary 
determines, in consultation with the Secretary 
of Energy, the Secretary of Agriculture, and the 
Administrator of the Environmental Protection 
Agency, are in accordance with the purposes of 
this paragraph.’’. 
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SEC. 617. GRANT PROGRAM TO INCREASE SUSTAINABLE 
LOW-INCOME 
COMMUNITY 
DEVELOPMENT 
CAPACITY. 
(a) IN GENERAL.—The Secretary may make grants 
to nonprofit organizations to use for any of the following 
purposes: 
(1) Training, educating, supporting, or advising 
an eligible community development organization or 
qualified youth service and conservation corps in im-
proving energy efficiency, resource conservation and 
reuse, design strategies to maximize energy effi-
ciency, installing or constructing renewable energy 
improvements (such as wind, wave, solar, biomass, 
and geothermal energy sources), and effective use of 
existing infrastructure in affordable housing and 
economic development activities in low-income com-
munities, taking into consideration energy efficiency 
requirements under section 604(a) of this title and 
with the enhanced energy efficiency and conservation 
standards, and the green building standards, under 
section 604(b) of this title. 
(2) Providing loans, grants, or predevelopment 
assistance to eligible community development organi-
zations or qualified youth service and conservation 
corps to carry out energy efficiency improvements 
that comply with the energy efficiency requirements 
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under section 604(a) of this title, resource conserva-
tion and reuse, and effective use of existing infra-
structure in affordable housing and economic devel-
opment activities in low-income communities. In pro-
viding assistance under this paragraph, the Sec-
retary shall give more preference to activities based 
on the extent to which the activities will result in 
compliance with the enhanced energy efficiency and 
conservation standards, and the green building 
standards, under section 604(b) of this title. 
(3) Such other purposes as the Secretary deter-
mines are in accordance with the purposes of this 
subsection. 
(b) APPLICATION REQUIREMENT.—To be eligible for 
a grant under this section, a nonprofit organization shall 
prepare and submit to the Secretary an application at 
such time, in such manner, and containing such informa-
tion as the Secretary may require. 
(c) AWARD OF CONTRACTS.—Contracts for architec-
tural or engineering services funded with amounts from 
grants made under this section shall be awarded in accord-
ance with chapter 11 of title 40, United States Code (re-
lating to selection of architects and engineers). 
(d) MATCHING REQUIREMENT.—A grant made under 
this section may not exceed the amount that the nonprofit 
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organization receiving the grant certifies, to the Secretary, 
will be provided (in cash or in kind) from non-govern-
mental sources to carry out the purposes for which the 
grant is made. 
(e) DEFINITIONS.—For purposes of this section, the 
following definitions shall apply: 
(1) The term ‘‘nonprofit organization’’ has the 
meaning given such term in section 104 of the Cran-
ston-Gonzalez National Affordable Housing Act (42 
U.S.C. 12704). 
(2) The term ‘‘eligible community development 
organization’’ means— 
(A) a unit of general local government (as 
defined in section 104 of the Cranston-Gonzalez 
National Affordable Housing Act (42 U.S.C. 
12704)); 
(B) a community housing development or-
ganization (as defined in section 104 of the 
Cranston-Gonzalez National Affordable Hous-
ing Act (42 U.S.C. 12704)); 
(C) an Indian tribe or tribally designated 
housing entity (as such terms are defined in 
section 4 of the Native American Housing As-
sistance and Self-Determination Act of 1996 
(25 U.S.C. 4103)); or 
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(D) a public housing agency, as such term 
is defined in section 3(b) of the United States 
Housing Act of 1937 (42 U.S.C. 1437(b)). 
(3) The term ‘‘low-income community’’ means a 
census tract in which 50 percent or more of the 
households have an income which is less than 80 
percent of the greater of— 
(A) the median gross income for such year 
for the area in which such census tract is lo-
cated; or 
(B) the median gross income for such year 
for the State in which such census tract is lo-
cated. 
(f) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Secretary to carry 
out this section $10,000,000 for each of fiscal years 2008 
through 2012. 
SEC. 618. UTILIZATION OF ENERGY PERFORMANCE CON-
TRACTS IN HOPE VI. 
Section 24(d) of the United States Housing Act of 
1937 (42 U.S.C. 1437v(d)) is amended by adding at the 
end the following new paragraph: 
‘‘(3) ENERGY PERFORMANCE CONTRACTS.— 
‘‘(A) IN
GENERAL.—The Secretary shall 
provide that a public housing agency shall re-
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ceive the full financial benefit, as determined by 
the Secretary, from any reduction in the cost of 
utilities resulting from any contract with a 
third party to undertake energy conservation 
improvements in connection with a revitaliza-
tion plan under this section. 
‘‘(B) THIRD
PARTY
CONTRACTS.—Con-
tracts described in subparagraph (A) may in-
clude contracts for equipment conversions to 
less costly utility sources, projects with resi-
dent-paid utilities, and adjustments to frozen 
base year consumption, including systems re-
paired to meet applicable building and safety 
codes and adjustments for occupancy rates in-
creased by rehabilitation. 
‘‘(C) TERM
OF
CONTRACT.—The total 
term of a contract described in subparagraph 
(A) shall not exceed 20 years to allow longer 
payback periods for retrofits, including win-
dows, heating system replacements, wall insula-
tion, site-based generation, advanced energy 
savings technologies, including renewable en-
ergy generation, and other such retrofits.’’. 
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SEC. 619. HOPE VI GREEN DEVELOPMENTS REQUIREMENT. 
(a) MANDATORY COMPONENT.—Section 24(e) of the 
United States Housing Act of 1937 (42 U.S.C. 1437v(e)) 
is amended by adding at the end the following new para-
graph: 
‘‘(4) GREEN DEVELOPMENTS REQUIREMENT.— 
‘‘(A) REQUIREMENT.—The Secretary may 
not make a grant under this section to an appli-
cant unless the proposed revitalization plan of 
the applicant to be carried out with such grant 
amounts meets the following requirements: 
‘‘(i) GREEN
COMMUNITIES
CRITERIA 
CHECKLIST.—All residential construction 
under the proposed plan complies with the 
national 
Green 
Communities 
criteria 
checklist for residential construction that 
provides criteria for the design, develop-
ment, and operation of affordable housing, 
as such checklist is in effect for purposes 
of this paragraph pursuant to subpara-
graph (D) at the date of the application 
for the grant, or any substantially equiva-
lent standard or standards as determined 
by the Secretary, as follows: 
‘‘(I) The proposed plan shall 
comply with all items of the national 
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Green Communities criteria checklist 
for residential construction that are 
identified as mandatory. 
‘‘(II) The proposed plan shall 
comply with such other nonmandatory 
items of such national Green Commu-
nities criteria checklist so as to result 
in a cumulative number of points at-
tributable 
to 
such 
nonmandatory 
items under such checklist of not less 
than— 
‘‘(aa) 25 points, in the case 
of any proposed plan (or portion 
thereof) consisting of new con-
struction; and 
‘‘(bb) 20 points, in the case 
of any proposed plan (or portion 
thereof) consisting of rehabilita-
tion. 
‘‘(ii) GREEN
BUILDINGS
CERTIFI-
CATION SYSTEM.—All non-residential con-
struction under the proposed plan complies 
with all minimum required levels of the 
green building rating systems and levels 
identified by the Secretary pursuant to 
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subparagraph (C), as such systems and 
levels are in effect for purposes of this 
paragraph pursuant to subparagraph (D) 
at the time of the application for the 
grant. 
‘‘(B) VERIFICATION.— 
‘‘(i) IN
GENERAL.—The Secretary 
shall verify, or provide for verification, suf-
ficient to ensure that each proposed revi-
talization plan carried out with amounts 
from a grant under this section complies 
with the requirements under subparagraph 
(A) and that the revitalization plan is car-
ried out in accordance with such require-
ments and plan. 
‘‘(ii) TIMING.—In providing for such 
verification, the Secretary shall establish 
procedures to ensure such compliance with 
respect to each grantee, and shall report to 
the Congress with respect to the compli-
ance of each grantee, at each of the fol-
lowing times: 
‘‘(I) Not later than 6 months 
after execution of the grant agreement 
under this section for the grantee. 
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‘‘(II) Upon completion of the re-
vitalization plan of the grantee. 
‘‘(C) IDENTIFICATION OF GREEN BUILD-
INGS RATING SYSTEMS AND LEVELS.— 
‘‘(i) IN
GENERAL.—For purposes of 
this paragraph, the Secretary shall identify 
rating systems and levels for green build-
ings that the Secretary determines to be 
the most likely to encourage a comprehen-
sive and environmentally-sound approach 
to ratings and standards for green build-
ings. The identification of the ratings sys-
tems and levels shall be based on the cri-
teria specified in clause (ii), shall identify 
the highest levels the Secretary determines 
are appropriate above the minimum levels 
required under the systems selected. With-
in 90 days of the completion of each study 
required by clause (iii), the Secretary shall 
review and update the rating systems and 
levels, or identify alternative systems and 
levels for purposes of this paragraph, tak-
ing into account the conclusions of such 
study. 
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‘‘(ii) CRITERIA.—In identifying the 
green rating systems and levels, the Sec-
retary shall take into consideration— 
‘‘(I) the ability and availability of 
assessors and auditors to independ-
ently verify the criteria and measure-
ment of metrics at the scale necessary 
to implement this paragraph; 
‘‘(II) the ability of the applicable 
ratings system organizations to collect 
and reflect public comment; 
‘‘(III) the ability of the standards 
to be developed and revised through a 
consensus-based process; 
‘‘(IV) 
An 
evaluation 
of 
the 
robustness of the criteria for a high- 
performance green building, which 
shall give credit for promoting— 
‘‘(aa) efficient and sustain-
able use of water, energy, and 
other natural resources; 
‘‘(bb) use of renewable en-
ergy sources; 
‘‘(cc) improved indoor and 
outdoor 
environmental 
quality 
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through enhanced indoor and 
outdoor air quality, thermal com-
fort, acoustics, outdoor noise pol-
lution, day lighting, pollutant 
source control, sustainable land-
scaping, and use of building sys-
tem controls and low- or no-emis-
sion materials, including pref-
erence for materials with no 
added carcinogens that are classi-
fied as Group 1 Known Carcino-
gens by the International Agency 
for Research on Cancer; and 
‘‘(dd) such other criteria as 
the Secretary determines to be 
appropriate; and 
‘‘(V) national recognition within 
the building industry. 
‘‘(iii) 5-YEAR EVALUATION.—At least 
once every five years, the Secretary shall 
conduct a study to evaluate and compare 
available third-party green building rating 
systems and levels, taking into account the 
criteria listed in clause (ii). 
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‘‘(D) APPLICABILITY
AND
UPDATING
OF 
STANDARDS.— 
‘‘(i) APPLICABILITY.—Except as pro-
vided in clause (ii) of this subparagraph, 
the national Green Communities criteria 
checklist and green building rating systems 
and levels referred to in clauses (i) and (ii) 
of subparagraph (A) that are in effect for 
purposes of this paragraph are such check-
list systems, and levels as in existence 
upon the date of the enactment of the 
Green Resources for Energy Efficient 
Neighborhoods Act of 2008. 
‘‘(ii) UPDATING.—The Secretary may, 
by regulation, adopt and apply, for pur-
poses of this paragraph, future amend-
ments and supplements to, and editions of, 
the national Green Communities criteria 
checklist, any standard or standards that 
the Secretary has determined to be sub-
stantially equivalent to such checklist, and 
the green building ratings systems and lev-
els identified by the Secretary pursuant to 
subparagraph (C).’’. 
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(b) SELECTION CRITERIA; GRADED COMPONENT.— 
Section 24(e)(2) of the United States Housing Act of 
1937 (42 U.S.C. 1437v(e)(2)) is amended— 
(1) in subparagraph (K), by striking ‘‘and’’ at 
the end; 
(2) by redesignating subparagraph (L) as sub-
paragraph (M); and 
(3) by inserting after subparagraph (K) the fol-
lowing new subparagraph: 
‘‘(L) the extent to which the proposed revi-
talization plan— 
‘‘(i) in the case of residential con-
struction, complies with the nonmandatory 
items of the national Green Communities 
criteria checklist identified in paragraph 
(4)(A)(i), or any substantially equivalent 
standard or standards as determined by 
the Secretary, but only to the extent such 
compliance exceeds the compliance nec-
essary to accumulate the number of points 
required under such paragraph; and 
‘‘(ii) in the case of non-residential 
construction, complies with the components 
of the green building rating systems and 
levels identified by the Secretary pursuant 
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to paragraph (4)(C), but only to the extent 
such compliance exceeds the minimum level 
required under such systems and levels; 
and’’. 
SEC. 620. CONSIDERATION OF ENERGY-EFFICIENCY IM-
PROVEMENTS IN APPRAISALS. 
(a) APPRAISALS IN CONNECTION WITH FEDERALLY 
RELATED TRANSACTIONS.— 
(1) REQUIREMENT.—Section 1110 of the Fi-
nancial Institutions Reform, Recovery, and Enforce-
ment Act of 1989 (12 U.S.C. 3339) is amended— 
(A) in paragraph (1), by striking ‘‘and’’ at 
the end; 
(B) by redesignating paragraph (2) as 
paragraph (3); and 
(C) by inserting after paragraph (1) the 
following new paragraph: 
‘‘(2) that such appraisals be performed in ac-
cordance with appraisal standards that require, in 
determining the value of a property, consideration of 
any renewable energy sources for, or energy-effi-
ciency or energy-conserving improvements or fea-
tures of, the property; and’’. 
(2) REVISION
OF
APPRAISAL
STANDARDS.— 
Each Federal financial institutions regulatory agen-
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cy shall, not later than 6 months after the date of 
the enactment of this Act, revise its standards for 
the performance of real estate appraisals in connec-
tion with federally related transactions under the ju-
risdiction of the agency to comply with the require-
ment under the amendments made by paragraph (1) 
of this subsection. 
(b) APPRAISER CERTIFICATION AND LICENSING RE-
QUIREMENTS.—Section 1116 of the Financial Institutions 
Reform, Recovery, and Enforcement Act of 1989 (12 
U.S.C. 3345) is amended— 
(1) in subsection (a), by inserting before the pe-
riod at the end the following: ‘‘, and meets the re-
quirements established pursuant to subsection (f) for 
qualifications regarding consideration of any renew-
able energy sources for, or energy-efficiency or en-
ergy-conserving improvements or features of, the 
property’’; 
(2) in subsection (c), by inserting before the pe-
riod at the end the following: ‘‘, which shall include 
compliance with the requirements established pursu-
ant to subsection (f) regarding consideration of any 
renewable energy sources for, or energy-efficiency or 
energy-conserving improvements or features of, the 
property’’; 
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(3) in subsection (e), by striking ‘‘The’’ and in-
serting ‘‘Except as provided in subsection (f), the’’; 
and 
(4) by adding at the end the following new sub-
section: 
‘‘(f) REQUIREMENTS FOR APPRAISERS REGARDING 
ENERGY-EFFICIENCY FEATURES.—The Appraisal Sub-
committee shall establish requirements for State certifi-
cation of State certified real estate appraisers and for 
State licensing of State licensed appraisers, to ensure that 
appraisers consider and are qualified to consider, in deter-
mining the value of a property, any renewable energy 
sources for, or energy-efficiency or energy-conserving im-
provements or features of, the property.’’. 
(c) GUIDELINES
FOR APPRAISING PHOTOVOLTAIC 
MEASURES
AND TRAINING
OF APPRAISERS.—Section 
1122 of the Financial Institutions Reform, Recovery, and 
Enforcement Act of 1989 (12 U.S.C. 3351) is amended 
by adding at the end the following new subsection: 
‘‘(g) GUIDELINES FOR APPRAISING PHOTOVOLTAIC 
MEASURES AND TRAINING OF APPRAISERS.—The Ap-
praisal Subcommittee shall, in consultation with the Sec-
retary of Housing and Urban Development, the Federal 
National Mortgage Association, and the Federal Home 
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Loan Mortgage Corporation, establish specific guidelines 
for— 
‘‘(1) appraising off- and on-grid photovoltaic 
measures for compliance with the appraisal stand-
ards prescribed pursuant to section 1110(2); 
‘‘(2) requirements under section 1116(f) for 
certification of State certified real estate appraisers 
and for State licensing of State licensed appraisers, 
to ensure that appraisers consider, and are qualified 
to consider, such photovoltaic measures in deter-
mining the value of a property; and 
‘‘(3) training of appraisers to meet the require-
ments established pursuant to paragraph (2) of this 
subsection.’’. 
SEC. 621. ASSISTANCE FOR HOUSING ASSISTANCE COUN-
CIL. 
The Secretary shall require the Housing Assistance 
Council— 
(1) to encourage each organization that receives 
assistance from the Council with any amounts made 
available from the Secretary to provide that any 
structures and buildings developed or assisted under 
projects, programs, and activities funded with such 
amounts complies with the enhanced energy effi-
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ciency requirements under section 604(a) of this 
title; and 
(2) to establish incentives to encourage each 
such organization to provide that any such struc-
tures and buildings comply with the energy effi-
ciency and conservation standards, and the green 
building standards, under section 604(b) of this 
title. 
SEC. 622. RURAL HOUSING AND ECONOMIC DEVELOPMENT 
ASSISTANCE. 
The Secretary shall— 
(1) encourage each tribe, agency, organization, 
corporation, and other entity that receives any as-
sistance from the Office of Rural Housing and Eco-
nomic Development of the Department of Housing 
and Urban Development to provide that any struc-
tures and buildings developed or assisted under ac-
tivities funded with such amounts complies with the 
energy efficiency requirements under section 604(a) 
of this title; and 
(2) establish incentives to encourage each such 
tribe, agency, organization, corporation, and other 
entity to provide that any such structures and build-
ings comply with the enhanced energy efficiency and 
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conservation standards, and the green building 
standards, under section 604(b) of this title. 
SEC. 623. LOANS TO STATES AND INDIAN TRIBES TO CARRY 
OUT RENEWABLE ENERGY SOURCES ACTIVI-
TIES. 
(a) ESTABLISHMENT
OF FUND.—There is estab-
lished in the Treasury of the United States a fund, to be 
known as the ‘‘Alternative Energy Sources State Loan 
Fund’’. 
(b) EXPENDITURES.— 
(1) IN GENERAL.—Subject to paragraph (2), on 
request by the Secretary, the Secretary of the Treas-
ury shall transfer from the Fund to the Secretary 
such amounts as the Secretary determines are nec-
essary to provide loans under subsection (c)(1). 
(2) 
ADMINISTRATIVE
EXPENSES.—Of 
the 
amounts in the Fund, not more than 5 percent shall 
be available for each fiscal year to pay the adminis-
trative expenses of the Department of Housing and 
Urban Development to carry out this section. 
(c) LOANS TO STATES AND INDIAN TRIBES.— 
(1) IN
GENERAL.—The Secretary shall use 
amounts in the Fund to provide loans to States and 
Indian tribes to provide incentives to owners of sin-
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gle-family and multifamily housing, commercial 
properties, and public buildings to provide— 
(A) renewable energy sources for such 
structures, such as wind, wave, solar, biomass, 
or geothermal energy sources, including incen-
tives to companies and business to change their 
source of energy to such renewable energy 
sources and for changing the sources of energy 
for public buildings to such renewable energy 
sources; 
(B) energy efficiency and energy con-
serving improvements and features for such 
structures; or 
(C) infrastructure related to the delivery of 
electricity and hot water for structures lacking 
such amenities. 
(2) ELIGIBILITY.—To be eligible to receive a 
loan under this subsection, a State or Indian tribe, 
directly or through an appropriate State or tribal 
agency, shall submit to the Secretary an application 
at such time, in such manner, and containing such 
information as the Secretary may require. 
(3) CRITERIA FOR APPROVAL.—The Secretary 
may approve an application of a State or Indian 
tribe under paragraph (2) only if the Secretary de-
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168 
termines that the State or tribe will use the funds 
from the loan under this subsection to carry out a 
program to provide incentives described in para-
graph (1) that— 
(A) requires that any such renewable en-
ergy sources, and energy efficiency and energy 
conserving improvements and features, devel-
oped pursuant to assistance under the program 
result in compliance of the structure so im-
proved with the energy efficiency requirements 
under section 604(a) of this title; and 
(B) includes such compliance and audit re-
quirements as the Secretary determines are nec-
essary to ensure that the program is operated 
in a sound and effective manner. 
(4) PREFERENCE.—In making loans during 
each fiscal year, the Secretary shall give preference 
to States and Indian tribes that have not previously 
received a loan under this subsection. 
(5) MAXIMUM
AMOUNT.—The aggregate out-
standing principal amount from loans under this 
subsection to any single State or Indian tribe may 
not exceed $500,000,000. 
(6) LOAN TERMS.—Each loan under this sub-
section shall have a term to maturity of not more 
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169 
than 10 years and shall bear interest at annual rate, 
determined by the Secretary, that shall not exceed 
interest rate charged by the Federal Reserve Bank 
of New York to commercial banks and other deposi-
tory institutions for very short-term loans under the 
primary credit program, as most recently published 
in the Federal Reserve Statistical Release on se-
lected interest rates (daily or weekly), and commonly 
referred to as the H.15 release, preceding the date 
of a determination for purposes of applying this 
paragraph. 
(7) LOAN
REPAYMENT.—The Secretary shall 
require full repayment of each loan made under this 
section. 
(d) INVESTMENT OF AMOUNTS.— 
(1) IN GENERAL.—The Secretary of the Treas-
ury shall invest such amounts in the Fund that are 
not, in the judgment of the Secretary of the Treas-
ury, required to meet needs for current withdrawals. 
(2) OBLIGATIONS OF UNITED STATES.—Invest-
ments may be made only in interest-bearing obliga-
tions of the United States. 
(e) REPORTS.— 
(1) REPORTS TO SECRETARY.—For each year 
during the term of a loan made under subsection 
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(c), the State or Indian tribe that received the loan 
shall submit to the Secretary a report describing the 
State or tribal alternative energy sources program 
for which the loan was made and the activities con-
ducted under the program using the loan funds dur-
ing that year. 
(2) REPORT
TO
CONGRESS.—Not later than 
September 30 of each year that loans made under 
subsection (c) are outstanding, the Secretary shall 
submit a report to the Congress describing the total 
amount of such loans provided under subsection (c) 
to each eligible State and Indian tribe during the fis-
cal year ending on such date, and an evaluation on 
effectiveness of the Fund. 
(f) AUTHORIZATION OF APPROPRIATIONS.—There is 
authorized 
to 
be 
appropriated 
to 
the 
Fund 
$5,000,000,000. 
(g) DEFINITIONS.—For purposes of this section, the 
following definitions shall apply: 
(1) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 
has the meaning given such term in section 4 of the 
Native American Housing Assistance and Self-De-
termination Act of 1996 (25 U.S.C. 4103). 
(2) STATE.—The term ‘‘State’’ means each of 
the several States, the Commonwealth of Puerto 
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171 
Rico, the District of Columbia, the Commonwealth 
of the Northern Mariana Islands, Guam, the Virgin 
Islands, American Samoa, the Trust Territories of 
the Pacific, or any other possession of the United 
States. 
SEC. 624. GREEN BANKING CENTERS. 
(a) INSURED DEPOSITORY INSTITUTIONS.—Section 8 
of the Federal Deposit Insurance Act (12 U.S.C. 1818) 
is amended by adding at the end the following new sub-
section: 
‘‘(x) ‘GREEN BANKING’ CENTERS.— 
‘‘(1) IN GENERAL.—The Federal banking agen-
cies shall prescribe guidelines encouraging the estab-
lishment and maintenance of ‘green banking’ centers 
by insured depository institutions to provide any 
consumer who seeks information on obtaining a 
mortgage, home improvement loan, or home equity 
loan with additional information on— 
‘‘(A) obtaining an home energy rating or 
audit for the residence for which such mortgage 
or loan is sought; 
‘‘(B) obtaining financing for cost-effective 
energy-saving improvements to such property; 
and 
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173 
grants, or loans offered for qualified military 
personal, reservists, and veterans by the Sec-
retary of Veterans Affairs; 
‘‘(E) information about, and contact infor-
mation for, the Office of Efficiency and Renew-
able Energy at the Department of Energy, in-
cluding the weatherization assistance program; 
‘‘(F) information about, and contact infor-
mation for, the Energy Star Program of the 
Environmental Protection Agency; 
‘‘(G) information from, and contact infor-
mation for, the Federal Citizen Information 
Center of the General Services Administration 
on energy efficient mortgages and loans, home 
energy rating systems, and the availability of 
energy efficient mortgage information from a 
variety of Federal agencies; and 
‘‘(H) such other information as the agen-
cies or the insured depository institution may 
determine to be appropriate or useful.’’. 
(b) INSURED CREDIT UNIONS.—Section 206 of the 
Federal Credit Union Act (12 U.S.C. 1786) is amended 
by adding at the end the following new subsection: 
‘‘(x) ‘GREEN BANKING’ CENTERS.— 
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174 
‘‘(1) IN GENERAL.—The Board shall prescribe 
guidelines encouraging the establishment and main-
tenance of ‘green banking’ centers by insured credit 
unions to provide any member who seeks informa-
tion on obtaining a mortgage, home improvement 
loan, or home equity loan with additional informa-
tion on— 
‘‘(A) obtaining an home energy rating or 
audit for the residence for which such mortgage 
or loan is sought; 
‘‘(B) obtaining financing for cost-effective 
energy-saving improvements to such property; 
and 
‘‘(C) obtaining beneficial terms for any 
mortgage or loan, or qualifying for a larger 
mortgage or loan, secured by a residence which 
meets or will meet energy-efficiency standards. 
‘‘(2) INFORMATION AND REFERRALS.—The in-
formation made available to members under para-
graph (1) may include— 
‘‘(A) information on obtaining a home en-
ergy rating and contact information on quali-
fied energy raters in the area of the residence; 
‘‘(B) information on the secondary market 
guidelines that permit lenders to provide more 
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175 
favorable terms by allowing lenders to increase 
the ratio on debt-to-income requirements or to 
use the projected utility savings as a compen-
sating factor; 
‘‘(C) information including eligibility infor-
mation about, and contact information for, any 
conservation or renewable energy programs, 
grants, or loans offered by the Secretary of 
Housing and Urban Development, including the 
Energy Efficient Mortgage Program; 
‘‘(D) information including eligibility infor-
mation about, and contact information for, any 
conservation or renewable energy programs, 
grants, or loans offered for qualified military 
personal, reservists, and veterans by the Sec-
retary of Veterans Affairs; 
‘‘(E) information about, and contact infor-
mation for, the Office of Efficiency and Renew-
able Energy at the Department of Energy, in-
cluding the weatherization assistance program; 
‘‘(F) information from, and contact infor-
mation for, the Federal Citizen Information 
Center of the General Services Administration 
on energy efficient mortgages and loans, home 
energy rating systems, and the availability of 
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176 
energy efficient mortgage information from a 
variety of Federal agencies; and 
‘‘(G) such other information as the Board 
or the insured credit union may determine to be 
appropriate or useful.’’. 
SEC. 625. PUBLIC HOUSING ENERGY COST REPORT. 
(a) COLLECTION OF INFORMATION BY HUD.—The 
Secretary of Housing and Urban Development shall obtain 
from each public housing agency, by such time as may 
be necessary to comply with the reporting requirement 
under subsection (b), information regarding the energy 
costs for public housing administered or operated by the 
agency. For each public housing agency, such information 
shall include the monthly energy costs associated with 
each separate building and development of the agency, for 
the most recently completed 12-month period for which 
such information is available, and such other information 
as the Secretary determines is appropriate in determining 
which public housing buildings and developments are most 
in need of repairs and improvements to reduce energy 
needs and costs and become more energy efficient. 
(b) REPORT.—Not later than the expiration of the 
12-month period beginning on the date of the enactment 
of this Act, the Secretary of Housing and Urban Develop-
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177 
ment shall submit a report to the Congress setting forth 
the information collected pursuant to subsection (a). 
TITLE VII—MISCELLANEOUS 
PROVISIONS 
SEC. 701. ALTERNATIVE FUEL PUMPS. 
(a) REQUIREMENT.—Not later than January 1, 
2018, each retail automotive fueling station owned by a 
major integrated oil company shall have at least 1 alter-
native fuel pump (and necessary infrastructure and stor-
age facilities) available to dispense for automotive pur-
poses a fuel referred to in subparagraph (A), (B), (C), 
or (D) of subsection (c)(2) . 
(b) PENALTY.—A major integrated oil company that 
has failed to comply with subsection (a) as of January 1 
of any calendar year beginning with 2018 shall be liable 
for a civil penalty in the amount of $100,000 for each 
automotive fueling station owned by such company that 
is not in compliance. Any such penalty may be assessed 
and collected by the Secretary of Energy by order. The 
Secretary may bring an action in the appropriate United 
States District court to require the payment of civil pen-
alties imposed under this subsection, and such court shall 
have jurisdiction to enforce any order of the Secretary 
under this subsection. 
(c) DEFINITIONS.—For purposes of this section: 
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178 
(1) The term ‘‘major integrated oil company’’ 
has the meaning given that term in section 
167(h)(5)(B) of the Internal Revenue Code of 1986. 
(2) The term ‘‘alternative fuel pump’’ means a 
fuel pump that dispenses as a fuel for automotive 
purposes— 
(A) natural gas; 
(B) any fuel at least 85 percent of the vol-
ume of which consists of ethanol; 
(C) any mixture of biodiesel and diesel or 
renewable diesel (as defined in regulations 
under section 211(o) of the Clean Air Act), de-
termined without regard to any use of kerosene 
and containing at least 20 percent biodiesel or 
renewable diesel; or 
(D) hydrogen. 
(d) REGULATIONS.—The Secretary of Energy shall 
promulgate such regulations as may be necessary to carry 
out this section. 
SEC. 702. NATIONAL ENERGY CENTER OF EXCELLENCE. 
(a) ESTABLISHMENT.—The Secretary of Energy 
shall award a grant on a competitive basis to one consor-
tium of institutions of higher education (as such term is 
defined in section 102 of the Higher Education Act of 
1965) for the establishment of a National Energy Center 
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179 
of Excellence to conduct research and education activities 
in geological and geothermal sciences, renewable energy 
and energy efficiency (including energy technology using 
clean coal, solar, wind, oil, natural gas, hydroelectric, 
biofuels, ethanol, and other energy alternatives), and en-
ergy conservation, including a special emphasis on envi-
ronmentally safe energy. 
(b) CONSORTIUM.—The consortium shall include at 
least two institutions of higher education, one of which 
must be eligible to receive assistance under part A or B 
of title III or title V of the Higher Education Act of 1965. 
(c) AUTHORIZATION OF APPROPRIATIONS.—There is 
authorized to be appropriated to carry out this section 
$25,000,000 for each of the fiscal years 2009 through 
2013. 
SEC. 703. SENSE OF CONGRESS REGARDING RENEWABLE 
BIOMASS. 
It is the sense of Congress that— 
(1) in order to fulfill the commitment of the 
United States to energy security and independence, 
the current definition of renewable biomass in the 
Renewable Fuel Standard (RFS) could be improved; 
(2) in order to meet the United States’ energy 
challenges in an environmentally responsible way, 
the RFS should be as inclusive as possible to better 
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180 
reflect the realities of our Nation’s resources, to en-
courage investment, and to help us meet the con-
gressional mandate for advanced biofuels; 
(3) Congress recognizes that renewable fuels 
are important to our climate and energy security 
strategy, as well as the rural communities they sup-
port; and 
(4) cellulosic biofuels can and should be pro-
duced from a highly diverse array of feedstocks, al-
lowing every region of the country to be a potential 
producer of this fuel. 
TITLE VIII—ENERGY TAX 
INCENTIVES 
SEC. 800. SHORT TITLE, ETC. 
(a) SHORT TITLE.—This title may be cited as the 
‘‘Energy Tax Incentives Act of 2008’’. 
(b) REFERENCE.—Except as otherwise expressly pro-
vided, whenever in this title an amendment or repeal is 
expressed in terms of an amendment to, or repeal of, a 
section or other provision, the reference shall be consid-
ered to be made to a section or other provision of the In-
ternal Revenue Code of 1986. 
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181 
Subtitle A—Energy Production 
Incentives 
PART 1—RENEWABLE ENERGY INCENTIVES 
SEC. 801. RENEWABLE ENERGY CREDIT. 
(a) EXTENSION OF CREDIT.— 
(1) 1-YEAR
EXTENSION
FOR
WIND
FACILI-
TIES.—Paragraph (1) of section 45(d) is amended 
by striking ‘‘January 1, 2009’’ and inserting ‘‘Janu-
ary 1, 2010’’. 
(2) 3-YEAR EXTENSION FOR CERTAIN OTHER 
FACILITIES.—Each of the following provisions of 
section 45(d) is amended by striking ‘‘January 1, 
2009’’ and inserting ‘‘January 1, 2012’’: 
(A) Clauses (i) and (ii) of paragraph 
(2)(A). 
(B) Clauses (i)(I) and (ii) of paragraph 
(3)(A). 
(C) Paragraph (4). 
(D) Paragraph (5). 
(E) Paragraph (6). 
(F) Paragraph (7). 
(G) Subparagraphs (A) and (B) of para-
graph (9). 
(b) MODIFICATION OF CREDIT PHASEOUT.— 
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(1) REPEAL OF PHASEOUT.—Subsection (b) of 
section 45 is amended— 
(A) by striking paragraph (1), and 
(B) by striking ‘‘the 8 cent amount in 
paragraph (1),’’ in paragraph (2) thereof. 
(2) LIMITATION BASED ON INVESTMENT IN FA-
CILITY.—Subsection (b) of section 45 is amended by 
inserting before paragraph (2) the following new 
paragraph: 
‘‘(1) LIMITATION
BASED
ON
INVESTMENT
IN 
FACILITY.— 
‘‘(A) IN
GENERAL.—In the case of any 
qualified facility originally placed in service 
after December 31, 2009, the amount of the 
credit determined under subsection (a) for any 
taxable year with respect to electricity produced 
at such facility shall not exceed the product 
of— 
‘‘(i) the applicable percentage with re-
spect to such facility, multiplied by 
‘‘(ii) the eligible basis of such facility. 
‘‘(B) CARRYFORWARD OF UNUSED LIMITA-
TION AND EXCESS CREDIT.— 
‘‘(i) UNUSED
LIMITATION.—If the 
limitation imposed under subparagraph (A) 
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with respect to any facility for any taxable 
year exceeds the prelimitation credit for 
such facility for such taxable year, the lim-
itation imposed under subparagraph (A) 
with respect to such facility for the suc-
ceeding taxable year shall be increased by 
the amount of such excess. 
‘‘(ii) 
EXCESS
CREDIT.—If 
the 
prelimitation credit with respect to any fa-
cility for any taxable year exceeds the limi-
tation imposed under subparagraph (A) 
with respect to such facility for such tax-
able year, the credit determined under sub-
section (a) with respect to such facility for 
the succeeding taxable year (determined 
before the application of subparagraph (A) 
for such succeeding taxable year) shall be 
increased by the amount of such excess. 
With respect to any facility, no amount 
may be carried forward under this clause 
to any taxable year beginning after the 10- 
year 
period 
described 
in 
subsection 
(a)(2)(A)(ii) with respect to such facility. 
‘‘(iii) PRELIMITATION
CREDIT.—The 
term ‘prelimitation credit’ with respect to 
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184 
any facility for a taxable year means the 
credit determined under subsection (a) 
with respect to such facility for such tax-
able year, determined without regard to 
subparagraph (A) and after taking into ac-
count any increase for such taxable year 
under clause (ii). 
‘‘(C) 
APPLICABLE
PERCENTAGE.—For 
purposes of this paragraph— 
‘‘(i) IN GENERAL.—The term ‘applica-
ble percentage’ means, with respect to any 
facility, the appropriate percentage pre-
scribed by the Secretary for the month in 
which such facility is originally placed in 
service. 
‘‘(ii) METHOD
OF
PRESCRIBING
AP-
PLICABLE
PERCENTAGE.—The applicable 
percentage prescribed by the Secretary for 
any month under clause (i) shall be the 
percentage which yields over a 10-year pe-
riod amounts of limitation under subpara-
graph (A) which have a present value 
equal to 35 percent of the eligible basis of 
the facility. 
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185 
‘‘(iii) METHOD
OF
DISCOUNTING.— 
The present value under clause (ii) shall be 
determined— 
‘‘(I) as of the last day of the 1st 
year of the 10-year period referred to 
in clause (ii), 
‘‘(II) by using a discount rate 
equal to the greater of 110 percent of 
the Federal long-term rate as in effect 
under section 1274(d) for the month 
preceding the month for which the ap-
plicable percentage is being pre-
scribed, or 4.5 percent, and 
‘‘(III) by taking into account the 
limitation under subparagraph (A) for 
any year on the last day of such year. 
‘‘(D) ELIGIBLE
BASIS.—For purposes of 
this paragraph— 
‘‘(i) IN GENERAL.—The term ‘eligible 
basis’ means, with respect to any facility, 
the sum of— 
‘‘(I) the basis of such facility de-
termined as of the time that such fa-
cility is originally placed in service, 
and 
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186 
‘‘(II) the portion of the basis of 
any shared qualified property which is 
properly allocable to such facility 
under clause (ii). 
‘‘(ii) RULES FOR ALLOCATION.—For 
purposes of subclause (II) of clause (i), the 
basis of shared qualified property shall be 
allocated among all qualified facilities 
which are projected to be placed in service 
and which require utilization of such prop-
erty in proportion to projected generation 
from such facilities. 
‘‘(iii) 
SHARED
QUALIFIED
PROP-
ERTY.—For purposes of this paragraph, 
the term ‘shared qualified property’ means, 
with respect to any facility, any property 
described in section 168(e)(3)(B)(vi)— 
‘‘(I) which a qualified facility will 
require for utilization of such facility, 
and 
‘‘(II) which is not a qualified fa-
cility. 
‘‘(iv) SPECIAL
RULE
RELATING
TO 
GEOTHERMAL FACILITIES.—In the case of 
any qualified facility using geothermal en-
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187 
ergy to produce electricity, the basis of 
such facility for purposes of this paragraph 
shall be determined as though intangible 
drilling and development costs described in 
section 263(c) were capitalized rather than 
expensed. 
‘‘(E) SPECIAL RULE FOR FIRST AND LAST 
YEAR OF CREDIT PERIOD.—In the case of any 
taxable year any portion of which is not within 
the 10-year period described in subsection 
(a)(2)(A)(ii) with respect to any facility, the 
amount of the limitation under subparagraph 
(A) with respect to such facility shall be re-
duced by an amount which bears the same ratio 
to the amount of such limitation (determined 
without regard to this subparagraph) as such 
portion of the taxable year which is not within 
such period bears to the entire taxable year. 
‘‘(F) ELECTION TO TREAT ALL FACILITIES 
PLACED IN SERVICE IN A YEAR AS 1 FACIL-
ITY.—At the election of the taxpayer, all quali-
fied facilities which are part of the same project 
and which are originally placed in service dur-
ing the same calendar year shall be treated for 
purposes of this section as 1 facility which is 
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188 
originally placed in service at the mid-point of 
such year or the first day of the following cal-
endar year.’’. 
(c) TRASH FACILITY CLARIFICATION.—Paragraph 
(7) of section 45(d) is amended— 
(1) by striking ‘‘facility which burns’’ and in-
serting ‘‘facility (other than a facility described in 
paragraph (6)) which uses’’, and 
(2) by striking ‘‘COMBUSTION’’. 
(d) EXPANSION OF BIOMASS FACILITIES.— 
(1) OPEN-LOOP
BIOMASS
FACILITIES.—Para-
graph (3) of section 45(d) is amended by redesig-
nating subparagraph (B) as subparagraph (C) and 
by inserting after subparagraph (A) the following 
new subparagraph: 
‘‘(B) EXPANSION
OF
FACILITY.—Such 
term shall include a new unit placed in service 
after the date of the enactment of this subpara-
graph in connection with a facility described in 
subparagraph (A), but only to the extent of the 
increased amount of electricity produced at the 
facility by reason of such new unit.’’. 
(2) CLOSED-LOOP BIOMASS FACILITIES.—Para-
graph (2) of section 45(d) is amended by redesig-
nating subparagraph (B) as subparagraph (C) and 
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189 
inserting after subparagraph (A) the following new 
subparagraph: 
‘‘(B) EXPANSION
OF
FACILITY.—Such 
term shall include a new unit placed in service 
after the date of the enactment of this subpara-
graph in connection with a facility described in 
subparagraph (A)(i), but only to the extent of 
the increased amount of electricity produced at 
the facility by reason of such new unit.’’. 
(e) MODIFICATION
OF RULES
FOR HYDROPOWER 
PRODUCTION.—Subparagraph (C) of section 45(c)(8) is 
amended to read as follows: 
‘‘(C) NONHYDROELECTRIC DAM.—For pur-
poses of subparagraph (A), a facility is de-
scribed in this subparagraph if— 
‘‘(i) the hydroelectric project installed 
on the nonhydroelectric dam is licensed by 
the Federal Energy Regulatory Commis-
sion and meets all other applicable environ-
mental, licensing, and regulatory require-
ments, 
‘‘(ii) the nonhydroelectric dam was 
placed in service before the date of the en-
actment of this paragraph and operated 
for flood control, navigation, or water sup-
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190 
ply purposes and did not produce hydro-
electric power on the date of the enactment 
of this paragraph, and 
‘‘(iii) the hydroelectric project is oper-
ated so that the water surface elevation at 
any given location and time that would 
have occurred in the absence of the hydro-
electric project is maintained, subject to 
any license requirements imposed under 
applicable law that change the water sur-
face elevation for the purpose of improving 
environmental quality of the affected wa-
terway. 
The Secretary, in consultation with the Federal 
Energy Regulatory Commission, shall certify if 
a hydroelectric project licensed at a nonhydro-
electric dam meets the criteria in clause (iii). 
Nothing in this section shall affect the stand-
ards under which the Federal Energy Regu-
latory Commission issues licenses for and regu-
lates hydropower projects under part I of the 
Federal Power Act.’’. 
(f) EFFECTIVE DATE.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendments made by 
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192 
‘‘(I) marine and hydrokinetic renewable en-
ergy.’’. 
(b) MARINE RENEWABLES.—Subsection (c) of sec-
tion 45 is amended by adding at the end the following 
new paragraph: 
‘‘(10) MARINE
AND
HYDROKINETIC
RENEW-
ABLE ENERGY.— 
‘‘(A) IN GENERAL.—The term ‘marine and 
hydrokinetic renewable energy’ means energy 
derived from— 
‘‘(i) waves, tides, and currents in 
oceans, estuaries, and tidal areas, 
‘‘(ii) free flowing water in rivers, 
lakes, and streams, 
‘‘(iii) free flowing water in an irriga-
tion system, canal, or other man-made 
channel, including projects that utilize non-
mechanical structures to accelerate the 
flow of water for electric power production 
purposes, or 
‘‘(iv) differentials in ocean tempera-
ture (ocean thermal energy conversion). 
‘‘(B) EXCEPTIONS.—Such term shall not 
include any energy which is derived from any 
source which utilizes a dam, diversionary struc-
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193 
ture (except as provided in subparagraph 
(A)(iii)), or impoundment for electric power 
production purposes.’’. 
(c) DEFINITION
OF FACILITY.—Subsection (d) of 
section 45 is amended by adding at the end the following 
new paragraph: 
‘‘(11) MARINE
AND
HYDROKINETIC
RENEW-
ABLE ENERGY FACILITIES.—In the case of a facility 
producing electricity from marine and hydrokinetic 
renewable energy, the term ‘qualified facility’ means 
any facility owned by the taxpayer— 
‘‘(A) which has a nameplate capacity rat-
ing of at least 150 kilowatts, and 
‘‘(B) which is originally placed in service 
on or after the date of the enactment of this 
paragraph and before January 1, 2012.’’. 
(d) CREDIT RATE.—Subparagraph (A) of section 
45(b)(4) is amended by striking ‘‘or (9)’’ and inserting 
‘‘(9), or (11)’’. 
(e) 
COORDINATION
WITH
SMALL
IRRIGATION 
POWER.—Paragraph (5) of section 45(d), as amended by 
section 801, is amended by striking ‘‘January 1, 2012’’ 
and inserting ‘‘the date of the enactment of paragraph 
(11)’’. 
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194 
(f) EFFECTIVE DATE.—The amendments made by 
this section shall apply to electricity produced and sold 
after the date of the enactment of this Act, in taxable 
years ending after such date. 
SEC. 803. ENERGY CREDIT. 
(a) EXTENSION OF CREDIT.— 
(1) SOLAR
ENERGY
PROPERTY.—Paragraphs 
(2)(A)(i)(II) and (3)(A)(ii) of section 48(a) are each 
amended by striking ‘‘January 1, 2009’’ and insert-
ing ‘‘January 1, 2017’’. 
(2) FUEL CELL PROPERTY.—Subparagraph (E) 
of section 48(c)(1) is amended by striking ‘‘Decem-
ber 31, 2008’’ and inserting ‘‘December 31, 2016’’. 
(3) MICROTURBINE PROPERTY.—Subparagraph 
(E) of section 48(c)(2) is amended by striking ‘‘De-
cember 31, 2008’’ and inserting ‘‘December 31, 
2016’’. 
(b) ALLOWANCE OF ENERGY CREDIT AGAINST AL-
TERNATIVE MINIMUM TAX.—Subparagraph (B) of section 
38(c)(4) is amended by striking ‘‘and’’ at the end of clause 
(iii), by redesignating clauses (v) and (vi) as clauses (vi) 
and (vii), respectively, and by inserting after clause (iv) 
the following new clause: 
‘‘(v) the credit determined under sec-
tion 46 to the extent that such credit is at-
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195 
tributable to the energy credit determined 
under section 48, and’’. 
(c) ENERGY CREDIT
FOR COMBINED HEAT
AND 
POWER SYSTEM PROPERTY.— 
(1) IN GENERAL.—Section 48(a)(3)(A) (defin-
ing energy property) is amended by striking ‘‘or’’ at 
the end of clause (iii), by inserting ‘‘or’’ at the end 
of clause (iv), and by adding at the end the following 
new clause: 
‘‘(v) combined heat and power system 
property,’’. 
(2) COMBINED
HEAT
AND
POWER
SYSTEM 
PROPERTY.—Section 48 is amended by adding at 
the end the following new subsection: 
‘‘(d) COMBINED HEAT AND POWER SYSTEM PROP-
ERTY.—For purposes of subsection (a)(3)(A)(v)— 
‘‘(1) COMBINED
HEAT
AND
POWER
SYSTEM 
PROPERTY.—The term ‘combined heat and power 
system property’ means property comprising a sys-
tem— 
‘‘(A) which uses the same energy source 
for the simultaneous or sequential generation of 
electrical power, mechanical shaft power, or 
both, in combination with the generation of 
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196 
steam or other forms of useful thermal energy 
(including heating and cooling applications), 
‘‘(B) which produces— 
‘‘(i) at least 20 percent of its total 
useful energy in the form of thermal en-
ergy which is not used to produce electrical 
or mechanical power (or combination 
thereof), and 
‘‘(ii) at least 20 percent of its total 
useful energy in the form of electrical or 
mechanical power (or combination thereof), 
‘‘(C) the energy efficiency percentage of 
which exceeds 60 percent, and 
‘‘(D) which is placed in service before Jan-
uary 1, 2017. 
‘‘(2) LIMITATION.— 
‘‘(A) IN GENERAL.—In the case of com-
bined heat and power system property with an 
electrical capacity in excess of the applicable ca-
pacity placed in service during the taxable year, 
the credit under subsection (a)(1) (determined 
without regard to this paragraph) for such year 
shall be equal to the amount which bears the 
same ratio to such credit as the applicable ca-
pacity bears to the capacity of such property. 
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197 
‘‘(B) APPLICABLE
CAPACITY.—For pur-
poses of subparagraph (A), the term ‘applicable 
capacity’ means 15 megawatts or a mechanical 
energy capacity of more than 20,000 horse-
power or an equivalent combination of electrical 
and mechanical energy capacities. 
‘‘(C) 
MAXIMUM
CAPACITY.—The 
term 
‘combined heat and power system property’ 
shall not include any property comprising a sys-
tem if such system has a capacity in excess of 
50 megawatts or a mechanical energy capacity 
in excess of 67,000 horsepower or an equivalent 
combination of electrical and mechanical energy 
capacities. 
‘‘(3) SPECIAL RULES.— 
‘‘(A) 
ENERGY
EFFICIENCY
PERCENT-
AGE.—For purposes of this subsection, the en-
ergy efficiency percentage of a system is the 
fraction— 
‘‘(i) the numerator of which is the 
total useful electrical, thermal, and me-
chanical power produced by the system at 
normal operating rates, and expected to be 
consumed in its normal application, and 
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198 
‘‘(ii) the denominator of which is the 
lower heating value of the fuel sources for 
the system. 
‘‘(B) DETERMINATIONS
MADE
ON
BTU 
BASIS.—The energy efficiency percentage and 
the percentages under paragraph (1)(B) shall 
be determined on a Btu basis. 
‘‘(C) INPUT AND OUTPUT PROPERTY NOT 
INCLUDED.—The term ‘combined heat and 
power system property’ does not include prop-
erty used to transport the energy source to the 
facility or to distribute energy produced by the 
facility. 
‘‘(4) SYSTEMS USING BIOMASS.—If a system is 
designed to use biomass (within the meaning of 
paragraphs (2) and (3) of section 45(c) without re-
gard to the last sentence of paragraph (3)(A)) for at 
least 90 percent of the energy source— 
‘‘(A) paragraph (1)(C) shall not apply, but 
‘‘(B) the amount of credit determined 
under subsection (a) with respect to such sys-
tem shall not exceed the amount which bears 
the same ratio to such amount of credit (deter-
mined without regard to this paragraph) as the 
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199 
energy efficiency percentage of such system 
bears to 60 percent.’’. 
(d) INCREASE OF CREDIT LIMITATION FOR FUEL 
CELL PROPERTY.—Subparagraph (B) of section 48(c)(1) 
is amended by striking ‘‘$500’’ and inserting ‘‘$1,500’’. 
(e) PUBLIC UTILITY PROPERTY TAKEN INTO AC-
COUNT.— 
(1) IN
GENERAL.—Paragraph (3) of section 
48(a) is amended by striking the second sentence 
thereof. 
(2) CONFORMING AMENDMENTS.— 
(A) Paragraph (1) of section 48(c) is 
amended by striking subparagraph (D) and re-
designating subparagraph (E) as subparagraph 
(D). 
(B) Paragraph (2) of section 48(c) is 
amended by striking subparagraph (D) and re-
designating subparagraph (E) as subparagraph 
(D). 
(f) EFFECTIVE DATE.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendments made by 
this section shall take effect on the date of the en-
actment of this Act. 
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200 
(2) ALLOWANCE AGAINST ALTERNATIVE MIN-
IMUM TAX.—The amendments made by subsection 
(b) shall apply to credits determined under section 
46 of the Internal Revenue Code of 1986 in taxable 
years beginning after the date of the enactment of 
this Act and to carrybacks of such credits. 
(3) COMBINED HEAT AND POWER AND FUEL 
CELL PROPERTY.—The amendments made by sub-
sections (c) and (d) shall apply to periods after the 
date of the enactment of this Act, in taxable years 
ending after such date, under rules similar to the 
rules of section 48(m) of the Internal Revenue Code 
of 1986 (as in effect on the day before the date of 
the enactment of the Revenue Reconciliation Act of 
1990). 
(4) PUBLIC UTILITY PROPERTY.—The amend-
ments made by subsection (e) shall apply to periods 
after February 13, 2008, in taxable years ending 
after such date, under rules similar to the rules of 
section 48(m) of the Internal Revenue Code of 1986 
(as in effect on the day before the date of the enact-
ment of the Revenue Reconciliation Act of 1990). 
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201 
SEC. 804. CREDIT FOR RESIDENTIAL ENERGY EFFICIENT 
PROPERTY. 
(a) EXTENSION.—Section 25D(g) is amended by 
striking ‘‘December 31, 2008’’ and inserting ‘‘December 
31, 2016’’. 
(b) MAXIMUM CREDIT FOR SOLAR ELECTRIC PROP-
ERTY.— 
(1) IN
GENERAL.—Section 25D(b)(1)(A) is 
amended by striking ‘‘$2,000’’ and inserting 
‘‘$4,000’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
25D(e)(4)(A)(i) is amended by striking ‘‘$6,667’’ 
and inserting ‘‘$13,333’’. 
(c) CREDIT FOR RESIDENTIAL WIND PROPERTY.— 
(1) IN GENERAL.—Section 25D(a) is amended 
by striking ‘‘and’’ at the end of paragraph (2), by 
striking the period at the end of paragraph (3) and 
inserting ‘‘, and’’, and by adding at the end the fol-
lowing new paragraph: 
‘‘(4) 30 percent of the qualified small wind en-
ergy property expenditures made by the taxpayer 
during such year.’’. 
(2) LIMITATION.—Section 25D(b)(1) is amend-
ed by striking ‘‘and’’ at the end of subparagraph 
(B), by striking the period at the end of subpara-
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graph (C) and inserting ‘‘, and’’, and by adding at 
the end the following new subparagraph: 
‘‘(D) $500 with respect to each half kilo-
watt of capacity (not to exceed $4,000) of wind 
turbines for which qualified small wind energy 
property expenditures are made.’’. 
(3) QUALIFIED
SMALL
WIND
ENERGY
PROP-
ERTY EXPENDITURES.— 
(A) IN
GENERAL.—Section 25D(d) is 
amended by adding at the end the following 
new paragraph: 
‘‘(4) QUALIFIED SMALL WIND ENERGY PROP-
ERTY
EXPENDITURE.—The term ‘qualified small 
wind energy property expenditure’ means an expend-
iture for property which uses a wind turbine to gen-
erate electricity for use in connection with a dwelling 
unit located in the United States and used as a resi-
dence by the taxpayer.’’. 
(B) 
NO
DOUBLE
BENEFIT.—Section 
45(d)(1) is amended by adding at the end the 
following new sentence: ‘‘Such term shall not 
include any facility with respect to which any 
qualified small wind energy property expendi-
ture (as defined in subsection (d)(4) of section 
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203 
25D) is taken into account in determining the 
credit under such section.’’. 
(4) MAXIMUM
EXPENDITURES
IN
CASE
OF 
JOINT
OCCUPANCY.—Section 
25D(e)(4)(A) 
is 
amended by striking ‘‘and’’ at the end of clause (ii), 
by striking the period at the end of clause (iii) and 
inserting ‘‘, and’’, and by adding at the end the fol-
lowing new clause: 
‘‘(iv) $1,667 in the case of each half 
kilowatt 
of 
capacity 
(not 
to 
exceed 
$13,333) of wind turbines for which quali-
fied small wind energy property expendi-
tures are made.’’. 
(d) CREDIT FOR GEOTHERMAL HEAT PUMP SYS-
TEMS.— 
(1) IN GENERAL.—Section 25D(a), as amended 
by subsection (c), is amended by striking ‘‘and’’ at 
the end of paragraph (3), by striking the period at 
the end of paragraph (4) and inserting ‘‘, and’’, and 
by adding at the end the following new paragraph: 
‘‘(5) 30 percent of the qualified geothermal 
heat pump property expenditures made by the tax-
payer during such year.’’. 
(2) 
LIMITATION.—Section 
25D(b)(1), 
as 
amended by subsection (c), is amended by striking 
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204 
‘‘and’’ at the end of subparagraph (C), by striking 
the period at the end of subparagraph (D) and in-
serting ‘‘, and’’, and by adding at the end the fol-
lowing new subparagraph: 
‘‘(E) $2,000 with respect to any qualified 
geothermal heat pump property expenditures.’’. 
(3) QUALIFIED
GEOTHERMAL
HEAT
PUMP 
PROPERTY
EXPENDITURE.—Section 
25D(d), 
as 
amended by subsection (c), is amended by adding at 
the end the following new paragraph: 
‘‘(5) QUALIFIED
GEOTHERMAL
HEAT
PUMP 
PROPERTY EXPENDITURE.— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
geothermal heat pump property expenditure’ 
means an expenditure for qualified geothermal 
heat pump property installed on or in connec-
tion with a dwelling unit located in the United 
States and used as a residence by the taxpayer. 
‘‘(B) 
QUALIFIED
GEOTHERMAL
HEAT 
PUMP
PROPERTY.—The term ‘qualified geo-
thermal heat pump property’ means any equip-
ment which— 
‘‘(i) uses the ground or ground water 
as a thermal energy source to heat the 
dwelling unit referred to in subparagraph 
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205 
(A) or as a thermal energy sink to cool 
such dwelling unit, and 
‘‘(ii) meets the requirements of the 
Energy Star program which are in effect 
at the time that the expenditure for such 
equipment is made.’’. 
(4) MAXIMUM
EXPENDITURES
IN
CASE
OF 
JOINT
OCCUPANCY.—Section 
25D(e)(4)(A), 
as 
amended by subsection (c), is amended by striking 
‘‘and’’ at the end of clause (iii), by striking the pe-
riod at the end of clause (iv) and inserting ‘‘, and’’, 
and by adding at the end the following new clause: 
‘‘(v) $6,667 in the case of any quali-
fied geothermal heat pump property ex-
penditures.’’. 
(e) CREDIT ALLOWED AGAINST ALTERNATIVE MIN-
IMUM TAX.— 
(1) IN
GENERAL.—Subsection (c) of section 
25D is amended to read as follows: 
‘‘(c) LIMITATION BASED
ON AMOUNT
OF TAX; 
CARRYFORWARD OF UNUSED CREDIT.— 
‘‘(1) LIMITATION
BASED
ON
AMOUNT
OF 
TAX.—In the case of a taxable year to which section 
26(a)(2) does not apply, the credit allowed under 
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206 
subsection (a) for the taxable year shall not exceed 
the excess of— 
‘‘(A) the sum of the regular tax liability 
(as defined in section 26(b)) plus the tax im-
posed by section 55, over 
‘‘(B) the sum of the credits allowable 
under this subpart (other than this section) and 
section 27 for the taxable year. 
‘‘(2) CARRYFORWARD OF UNUSED CREDIT.— 
‘‘(A) RULE
FOR
YEARS
IN
WHICH
ALL 
PERSONAL
CREDITS
ALLOWED
AGAINST
REG-
ULAR
AND
ALTERNATIVE
MINIMUM
TAX.—In 
the case of a taxable year to which section 
26(a)(2) applies, if the credit allowable under 
subsection (a) exceeds the limitation imposed by 
section 26(a)(2) for such taxable year reduced 
by the sum of the credits allowable under this 
subpart (other than this section), such excess 
shall be carried to the succeeding taxable year 
and added to the credit allowable under sub-
section (a) for such succeeding taxable year. 
‘‘(B) RULE
FOR
OTHER
YEARS.—In the 
case of a taxable year to which section 26(a)(2) 
does not apply, if the credit allowable under 
subsection (a) exceeds the limitation imposed by 
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207 
paragraph (1) for such taxable year, such ex-
cess shall be carried to the succeeding taxable 
year and added to the credit allowable under 
subsection (a) for such succeeding taxable 
year.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 23(b)(4)(B) is amended by in-
serting ‘‘and section 25D’’ after ‘‘this section’’. 
(B) Section 24(b)(3)(B) is amended by 
striking ‘‘and 25B’’ and inserting ‘‘, 25B, and 
25D’’. 
(C) Section 25B(g)(2) is amended by strik-
ing ‘‘section 23’’ and inserting ‘‘sections 23 and 
25D’’. 
(D) Section 26(a)(1) is amended by strik-
ing ‘‘and 25B’’ and inserting ‘‘25B, and 25D’’. 
(f) EFFECTIVE DATE.— 
(1) IN GENERAL.—The amendments made by 
this section shall apply to taxable years beginning 
after December 31, 2007. 
(2) APPLICATION
OF
EGTRRA
SUNSET.—The 
amendments made by subparagraphs (A) and (B) of 
subsection (e)(2) shall be subject to title IX of the 
Economic Growth and Tax Relief Reconciliation Act 
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208 
of 2001 in the same manner as the provisions of 
such Act to which such amendments relate. 
SEC. 805. SPECIAL RULE TO IMPLEMENT FERC AND STATE 
ELECTRIC RESTRUCTURING POLICY. 
(a) EXTENSION FOR QUALIFIED ELECTRIC UTILI-
TIES.— 
(1) IN
GENERAL.—Paragraph (3) of section 
451(i) is amended by inserting ‘‘(before January 1, 
2010, in the case of a qualified electric utility)’’ 
after ‘‘January 1, 2008’’. 
(2) QUALIFIED ELECTRIC UTILITY.—Subsection 
(i) of section 451 is amended by redesignating para-
graphs (6) through (10) as paragraphs (7) through 
(11), respectively, and by inserting after paragraph 
(5) the following new paragraph: 
‘‘(6) QUALIFIED ELECTRIC UTILITY.—For pur-
poses of this subsection, the term ‘qualified electric 
utility’ means a person that, as of the date of the 
qualifying 
electric 
transmission 
transaction, 
is 
vertically integrated, in that it is both— 
‘‘(A) a transmitting utility (as defined in 
section 3(23) of the Federal Power Act (16 
U.S.C. 796(23))) with respect to the trans-
mission facilities to which the election under 
this subsection applies, and 
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209 
‘‘(B) an electric utility (as defined in sec-
tion 3(22) of the Federal Power Act (16 U.S.C. 
796(22))).’’. 
(b) EXTENSION
OF PERIOD
FOR TRANSFER
OF 
OPERATIONAL
CONTROL
AUTHORIZED
BY
FERC.— 
Clause (ii) of section 451(i)(4)(B) is amended by striking 
‘‘December 31, 2007’’ and inserting ‘‘the date which is 
4 years after the close of the taxable year in which the 
transaction occurs’’. 
(c) PROPERTY LOCATED OUTSIDE
THE UNITED 
STATES NOT TREATED
AS EXEMPT UTILITY PROP-
ERTY.—Paragraph (5) of section 451(i) is amended by 
adding at the end the following new subparagraph: 
‘‘(C) EXCEPTION FOR PROPERTY LOCATED 
OUTSIDE THE UNITED STATES.—The term ‘ex-
empt utility property’ shall not include any 
property which is located outside the United 
States.’’. 
(d) EFFECTIVE DATES.— 
(1) EXTENSION.—The amendments made by 
subsection (a) shall apply to transactions after De-
cember 31, 2007. 
(2) TRANSFERS OF OPERATIONAL CONTROL.— 
The amendment made by subsection (b) shall take 
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210 
effect as if included in section 909 of the American 
Jobs Creation Act of 2004. 
(3) EXCEPTION FOR PROPERTY LOCATED OUT-
SIDE THE UNITED STATES.—The amendment made 
by subsection (c) shall apply to transactions after 
the date of the enactment of this Act. 
SEC. 806. NEW CLEAN RENEWABLE ENERGY BONDS. 
(a) IN GENERAL.—Subpart I of part IV of sub-
chapter A of chapter 1 is amended by adding at the end 
the following new section: 
‘‘SEC. 54C. NEW CLEAN RENEWABLE ENERGY BONDS. 
‘‘(a) NEW CLEAN RENEWABLE ENERGY BOND.—For 
purposes of this subpart, the term ‘new clean renewable 
energy bond’ means any bond issued as part of an issue 
if— 
‘‘(1) 100 percent of the available project pro-
ceeds of such issue are to be used for capital expend-
itures incurred by public power providers or coopera-
tive electric companies for one or more qualified re-
newable energy facilities, 
‘‘(2) the bond is issued by a qualified issuer, 
and 
‘‘(3) the issuer designates such bond for pur-
poses of this section. 
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211 
‘‘(b) REDUCED CREDIT AMOUNT.—The annual credit 
determined under section 54A(b) with respect to any new 
clean renewable energy bond shall be 70 percent of the 
amount so determined without regard to this subsection. 
‘‘(c) LIMITATION
ON AMOUNT
OF BONDS DES-
IGNATED.— 
‘‘(1) IN
GENERAL.—The maximum aggregate 
face amount of bonds which may be designated 
under subsection (a) by any issuer shall not exceed 
the limitation amount allocated under this sub-
section to such issuer. 
‘‘(2) NATIONAL
LIMITATION
ON
AMOUNT
OF 
BONDS DESIGNATED.—There is a national new clean 
renewable energy bond limitation of $1,750,000,000 
which shall be allocated by the Secretary as provided 
in paragraph (3), except that— 
‘‘(A) not more than 331⁄3 percent thereof 
may be allocated to qualified projects of public 
power providers, 
‘‘(B) not more than 331⁄3 percent thereof 
may be allocated to qualified projects of govern-
mental bodies, and 
‘‘(C) not more than 331⁄3 percent thereof 
may be allocated to qualified projects of cooper-
ative electric companies. 
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212 
‘‘(3) METHOD OF ALLOCATION.— 
‘‘(A) ALLOCATION AMONG PUBLIC POWER 
PROVIDERS.—After the Secretary determines 
the qualified projects of public power providers 
which are appropriate for receiving an alloca-
tion of the national new clean renewable energy 
bond limitation, the Secretary shall, to the max-
imum extent practicable, make allocations 
among such projects in such manner that the 
amount allocated to each such project bears the 
same ratio to the cost of such project as the 
limitation under paragraph (2)(A) bears to the 
cost of all such projects. 
‘‘(B) ALLOCATION AMONG GOVERNMENTAL 
BODIES AND COOPERATIVE ELECTRIC COMPA-
NIES.—The Secretary shall make allocations of 
the amount of the national new clean renewable 
energy bond limitation described in paragraphs 
(2)(B) and (2)(C) among qualified projects of 
governmental bodies and cooperative electric 
companies, respectively, in such manner as the 
Secretary determines appropriate. 
‘‘(d) DEFINITIONS.—For purposes of this section— 
‘‘(1) QUALIFIED RENEWABLE ENERGY FACIL-
ITY.—The term ‘qualified renewable energy facility’ 
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means a qualified facility (as determined under sec-
tion 45(d) without regard to paragraphs (8) and 
(10) thereof and to any placed in service date) 
owned by a public power provider, a governmental 
body, or a cooperative electric company. 
‘‘(2) PUBLIC
POWER
PROVIDER.—The term 
‘public power provider’ means a State utility with a 
service obligation, as such terms are defined in sec-
tion 217 of the Federal Power Act (as in effect on 
the date of the enactment of this paragraph). 
‘‘(3) GOVERNMENTAL BODY.—The term ‘gov-
ernmental body’ means any State or Indian tribal 
government, or any political subdivision thereof. 
‘‘(4) COOPERATIVE ELECTRIC COMPANY.—The 
term ‘cooperative electric company’ means a mutual 
or cooperative electric company described in section 
501(c)(12) or section 1381(a)(2)(C). 
‘‘(5) CLEAN RENEWABLE ENERGY BOND LEND-
ER.—The term ‘clean renewable energy bond lender’ 
means a lender which is a cooperative which is 
owned by, or has outstanding loans to, 100 or more 
cooperative electric companies and is in existence on 
February 1, 2002, and shall include any affiliated 
entity which is controlled by such lender. 
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214 
‘‘(6) QUALIFIED ISSUER.—The term ‘qualified 
issuer’ means a public power provider, a cooperative 
electric company, a governmental body, a clean re-
newable energy bond lender, or a not-for-profit elec-
tric utility which has received a loan or loan guar-
antee under the Rural Electrification Act.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Paragraph (1) of section 54A(d) is amended 
to read as follows: 
‘‘(1) QUALIFIED TAX CREDIT BOND.—The term 
‘qualified tax credit bond’ means— 
‘‘(A) a qualified forestry conservation 
bond, or 
‘‘(B) a new clean renewable energy bond, 
which is part of an issue that meets requirements of 
paragraphs (2), (3), (4), (5), and (6).’’. 
(2) Subparagraph (C) of section 54A(d)(2) is 
amended to read as follows: 
‘‘(C) QUALIFIED PURPOSE.—For purposes 
of this paragraph, the term ‘qualified purpose’ 
means— 
‘‘(i) in the case of a qualified forestry 
conservation bond, a purpose specified in 
section 54B(e), and 
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215 
‘‘(ii) in the case of a new clean renew-
able energy bond, a purpose specified in 
section 54C(a)(1).’’. 
(3) The table of sections for subpart I of part 
IV of subchapter A of chapter 1 is amended by add-
ing at the end the following new item: 
‘‘Sec. 54C. New clean renewable energy bonds.’’. 
(c) APPLICATION OF CERTAIN LABOR STANDARDS 
ON PROJECTS FINANCED UNDER TAX CREDIT BONDS.— 
Subchapter IV of chapter 31 of title 40, United States 
Code, shall apply to projects financed with the proceeds 
of any tax credit bond (as defined in section 54A of the 
Internal Revenue Code of 1986) other than qualified for-
estry conservation bonds (as defined in section 54B of 
such Code). 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to obligations issued after the date 
of the enactment of this Act. 
PART 2—CARBON MITIGATION PROVISIONS 
SEC. 811. EXPANSION AND MODIFICATION OF ADVANCED 
COAL PROJECT INVESTMENT CREDIT. 
(a) MODIFICATION
OF CREDIT AMOUNT.—Section 
48A(a) is amended by striking ‘‘and’’ at the end of para-
graph (1), by striking the period at the end of paragraph 
(2) and inserting ‘‘, and’’, and by adding at the end the 
following new paragraph: 
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216 
‘‘(3) 30 percent of the qualified investment for 
such taxable year in the case of projects described 
in clause (iii) of subsection (d)(3)(B).’’. 
(b) EXPANSION OF AGGREGATE CREDITS.—Section 
48A(d)(3)(A) is amended by striking ‘‘$1,300,000,000’’ 
and inserting ‘‘$2,250,000,000’’. 
(c) AUTHORIZATION OF ADDITIONAL PROJECTS.— 
(1) IN GENERAL.—Subparagraph (B) of section 
48A(d)(3) is amended to read as follows: 
‘‘(B) PARTICULAR PROJECTS.—Of the dol-
lar amount in subparagraph (A), the Secretary 
is authorized to certify— 
‘‘(i) $800,000,000 for integrated gas-
ification combined cycle projects the appli-
cation for which is submitted during the 
period described in paragraph (2)(A)(i), 
‘‘(ii) $500,000,000 for projects which 
use other advanced coal-based generation 
technologies the application for which is 
submitted during the period described in 
paragraph (2)(A)(i), and 
‘‘(iii) $950,000,000 for advanced coal- 
based generation technology projects the 
application for which is submitted during 
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217 
the 
period 
described 
in 
paragraph 
(2)(A)(ii).’’. 
(2) APPLICATION
PERIOD
FOR
ADDITIONAL 
PROJECTS.—Subparagraph (A) of section 48A(d)(2) 
is amended to read as follows: 
‘‘(A) APPLICATION PERIOD.—Each appli-
cant for certification under this paragraph shall 
submit an application meeting the requirements 
of subparagraph (B). An applicant may only 
submit an application— 
‘‘(i) for an allocation from the dollar 
amount specified in clause (i) or (ii) of 
paragraph (3)(B) during the 3-year period 
beginning on the date the Secretary estab-
lishes the program under paragraph (1), 
and 
‘‘(ii) for an allocation from the dollar 
amount specified in paragraph (3)(B)(iii) 
during the 3-year period beginning at the 
earlier of the termination of the period de-
scribed in clause (i) or the date prescribed 
by the Secretary.’’. 
(3) CAPTURE AND SEQUESTRATION OF CARBON 
DIOXIDE EMISSIONS REQUIREMENT.— 
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219 
(C) RECAPTURE OF CREDIT FOR FAILURE 
TO SEQUESTER.—Section 48A is amended by 
adding at the end the following new subsection: 
‘‘(i) RECAPTURE OF CREDIT FOR FAILURE TO SE-
QUESTER.—The Secretary shall provide for recapturing 
the benefit of any credit allowable under subsection (a) 
with respect to any project which fails to attain or main-
tain the separation and sequestration requirements of sub-
section (e)(1)(G).’’. 
(4) ADDITIONAL
PRIORITY
FOR
RESEARCH 
PARTNERSHIPS.—Section 48A(e)(3)(B), as amended 
by paragraph (3)(B), is amended— 
(A) by striking ‘‘and’’ at the end of clause 
(ii), 
(B) by redesignating clause (iii) as clause 
(iv), and 
(C) by inserting after clause (ii) the fol-
lowing new clause: 
‘‘(iii) applicant participants who have 
a research partnership with an eligible edu-
cational institution (as defined in section 
529(e)(5)), and’’. 
(5) CLERICAL AMENDMENT.—Section 48A(e)(3) 
is amended by striking ‘‘INTEGRATED GASIFICATION 
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220 
COMBINED
CYCLE’’ in the heading and inserting 
‘‘CERTAIN’’. 
(d) DISCLOSURE OF ALLOCATIONS.—Section 48A(d) 
is amended by adding at the end the following new para-
graph: 
‘‘(5) DISCLOSURE OF ALLOCATIONS.—The Sec-
retary shall, upon making a certification under this 
subsection or section 48B(d), publicly disclose the 
identity of the applicant and the amount of the cred-
it certified with respect to such applicant.’’. 
(e) EFFECTIVE DATES.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendments made by 
this section shall apply to credits the application for 
which is submitted during the period described in 
section 48A(d)(2)(A)(ii) of the Internal Revenue 
Code of 1986 and which are allocated or reallocated 
after the date of the enactment of this Act. 
(2) 
DISCLOSURE
OF
ALLOCATIONS.—The 
amendment made by subsection (d) shall apply to 
certifications made after the date of the enactment 
of this Act. 
(3) CLERICAL AMENDMENT.—The amendment 
made by subsection (c)(5) shall take effect as if in-
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221 
cluded in the amendment made by section 1307(b) 
of the Energy Tax Incentives Act of 2005. 
SEC. 812. EXPANSION AND MODIFICATION OF COAL GASIFI-
CATION INVESTMENT CREDIT. 
(a) MODIFICATION
OF CREDIT AMOUNT.—Section 
48B(a) is amended by inserting ‘‘(30 percent in the case 
of credits allocated under subsection (d)(1)(B))’’ after ‘‘20 
percent’’. 
(b) EXPANSION OF AGGREGATE CREDITS.—Section 
48B(d)(1) is amended by striking ‘‘shall not exceed 
$350,000,000’’ and all that follows and inserting ‘‘shall 
not exceed— 
‘‘(A) $350,000,000, plus 
‘‘(B) $150,000,000 for qualifying gasifi-
cation projects that include equipment which 
separates and sequesters at least 75 percent of 
such project’s total carbon dioxide emissions.’’. 
(c) RECAPTURE OF CREDIT FOR FAILURE TO SE-
QUESTER.—Section 48B is amended by adding at the end 
the following new subsection: 
‘‘(f) RECAPTURE OF CREDIT FOR FAILURE TO SE-
QUESTER.—The Secretary shall provide for recapturing 
the benefit of any credit allowable under subsection (a) 
with respect to any project which fails to attain or main-
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222 
tain the separation and sequestration requirements for 
such project under subsection (d)(1).’’. 
(d) SELECTION
PRIORITIES.—Section 48B(d) is 
amended by adding at the end the following new para-
graph: 
‘‘(4) SELECTION PRIORITIES.—In determining 
which qualifying gasification projects to certify 
under this section, the Secretary shall— 
‘‘(A) give highest priority to projects with 
the greatest separation and sequestration per-
centage of total carbon dioxide emissions, and 
‘‘(B) give high priority to applicant partici-
pants who have a research partnership with an 
eligible educational institution (as defined in 
section 529(e)(5)).’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to credits described in section 
48B(d)(1)(B) of the Internal Revenue Code of 1986 which 
are allocated or reallocated after the date of the enactment 
of this Act. 
SEC. 813. TEMPORARY INCREASE IN COAL EXCISE TAX. 
Paragraph (2) of section 4121(e) is amended— 
(1) by striking ‘‘January 1, 2014’’ in subpara-
graph (A) and inserting ‘‘December 31, 2018’’, and 
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223 
(2) by striking ‘‘January 1 after 1981’’ in sub-
paragraph (B) and inserting ‘‘December 31 after 
2007’’. 
SEC. 814. SPECIAL RULES FOR REFUND OF THE COAL EX-
CISE TAX TO CERTAIN COAL PRODUCERS 
AND EXPORTERS. 
(a) REFUND.— 
(1) COAL PRODUCERS.— 
(A) IN
GENERAL.—Notwithstanding sub-
sections (a)(1) and (c) of section 6416 and sec-
tion 6511 of the Internal Revenue Code of 
1986, if— 
(i) a coal producer establishes that 
such coal producer, or a party related to 
such coal producer, exported coal produced 
by such coal producer to a foreign country 
or shipped coal produced by such coal pro-
ducer to a possession of the United States, 
or caused such coal to be exported or 
shipped, the export or shipment of which 
was other than through an exporter who 
meets the requirements of paragraph (2), 
(ii) such coal producer filed an excise 
tax return on or after October 1, 1990, 
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224 
and on or before the date of the enactment 
of this Act, and 
(iii) such coal producer files a claim 
for refund with the Secretary not later 
than the close of the 30-day period begin-
ning on the date of the enactment of this 
Act, 
then the Secretary shall pay to such coal pro-
ducer an amount equal to the tax paid under 
section 4121 of such Code on such coal ex-
ported or shipped by the coal producer or a 
party related to such coal producer, or caused 
by the coal producer or a party related to such 
coal producer to be exported or shipped. 
(B) SPECIAL
RULES
FOR
CERTAIN
TAX-
PAYERS.—For purposes of this section— 
(i) IN GENERAL.—If a coal producer 
or a party related to a coal producer has 
received a judgment described in clause 
(iii), such coal producer shall be deemed to 
have established the export of coal to a for-
eign country or shipment of coal to a pos-
session of the United States under sub-
paragraph (A)(i). 
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225 
(ii) AMOUNT OF PAYMENT.—If a tax-
payer described in clause (i) is entitled to 
a payment under subparagraph (A), the 
amount of such payment shall be reduced 
by any amount paid pursuant to the judg-
ment described in clause (iii). 
(iii) JUDGMENT DESCRIBED.—A judg-
ment is described in this subparagraph if 
such judgment— 
(I) is made by a court of com-
petent jurisdiction within the United 
States, 
(II) relates to the constitu-
tionality of any tax paid on exported 
coal under section 4121 of the Inter-
nal Revenue Code of 1986, and 
(III) is in favor of the coal pro-
ducer or the party related to the coal 
producer. 
(2) EXPORTERS.—Notwithstanding subsections 
(a)(1) and (c) of section 6416 and section 6511 of 
the Internal Revenue Code of 1986, and a judgment 
described in paragraph (1)(B)(iii) of this subsection, 
if— 
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226 
(A) an exporter establishes that such ex-
porter exported coal to a foreign country or 
shipped coal to a possession of the United 
States, or caused such coal to be so exported or 
shipped, 
(B) such exporter filed a tax return on or 
after October 1, 1990, and on or before the 
date of the enactment of this Act, and 
(C) such exporter files a claim for refund 
with the Secretary not later than the close of 
the 30-day period beginning on the date of the 
enactment of this Act, 
then the Secretary shall pay to such exporter an 
amount equal to $0.825 per ton of such coal ex-
ported by the exporter or caused to be exported or 
shipped, or caused to be exported or shipped, by the 
exporter. 
(b) LIMITATIONS.—Subsection (a) shall not apply 
with respect to exported coal if a settlement with the Fed-
eral Government has been made with and accepted by, the 
coal producer, a party related to such coal producer, or 
the exporter, of such coal, as of the date that the claim 
is filed under this section with respect to such exported 
coal. For purposes of this subsection, the term ‘‘settlement 
with the Federal Government’’ shall not include any settle-
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227 
ment or stipulation entered into as of the date of the en-
actment of this Act, the terms of which contemplate a 
judgment concerning which any party has reserved the 
right to file an appeal, or has filed an appeal. 
(c) SUBSEQUENT REFUND PROHIBITED.—No refund 
shall be made under this section to the extent that a credit 
or refund of such tax on such exported or shipped coal 
has been paid to any person. 
(d) DEFINITIONS.—For purposes of this section— 
(1) COAL
PRODUCER.—The term ‘‘coal pro-
ducer’’ means the person in whom is vested owner-
ship of the coal immediately after the coal is severed 
from the ground, without regard to the existence of 
any contractual arrangement for the sale or other 
disposition of the coal or the payment of any royal-
ties between the producer and third parties. The 
term includes any person who extracts coal from 
coal waste refuse piles or from the silt waste product 
which results from the wet washing (or similar proc-
essing) of coal. 
(2) EXPORTER.—The term ‘‘exporter’’ means a 
person, other than a coal producer, who does not 
have a contract, fee arrangement, or any other 
agreement with a producer or seller of such coal to 
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228 
export or ship such coal to a third party on behalf 
of the producer or seller of such coal and— 
(A) is indicated in the shipper’s export 
declaration or other documentation as the ex-
porter of record, or 
(B) actually exported such coal to a for-
eign country or shipped such coal to a posses-
sion of the United States, or caused such coal 
to be so exported or shipped. 
(3) RELATED PARTY.—The term ‘‘a party re-
lated to such coal producer’’ means a person who— 
(A) is related to such coal producer 
through any degree of common management, 
stock ownership, or voting control, 
(B) is related (within the meaning of sec-
tion 144(a)(3) of the Internal Revenue Code of 
1986) to such coal producer, or 
(C) has a contract, fee arrangement, or 
any other agreement with such coal producer to 
sell such coal to a third party on behalf of such 
coal producer. 
(4) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Treasury or the Secretary’s des-
ignee. 
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229 
(e) TIMING OF REFUND.—With respect to any claim 
for refund filed pursuant to this section, the Secretary 
shall determine whether the requirements of this section 
are met not later than 180 days after such claim is filed. 
If the Secretary determines that the requirements of this 
section are met, the claim for refund shall be paid not 
later than 180 days after the Secretary makes such deter-
mination. 
(f) INTEREST.—Any refund paid pursuant to this 
section shall be paid by the Secretary with interest from 
the date of overpayment determined by using the overpay-
ment rate and method under section 6621 of the Internal 
Revenue Code of 1986. 
(g) DENIAL OF DOUBLE BENEFIT.—The payment 
under subsection (a) with respect to any coal shall not ex-
ceed— 
(1) in the case of a payment to a coal producer, 
the amount of tax paid under section 4121 of the 
Internal Revenue Code of 1986 with respect to such 
coal by such coal producer or a party related to such 
coal producer, and 
(2) in the case of a payment to an exporter, an 
amount equal to $0.825 per ton with respect to such 
coal exported by the exporter or caused to be ex-
ported by the exporter. 
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230 
(h) APPLICATION OF SECTION.—This section applies 
only to claims on coal exported or shipped on or after Oc-
tober 1, 1990, through the date of the enactment of this 
Act. 
(i) STANDING NOT CONFERRED.— 
(1) EXPORTERS.—With respect to exporters, 
this section shall not confer standing upon an ex-
porter to commence, or intervene in, any judicial or 
administrative proceeding concerning a claim for re-
fund by a coal producer of any Federal or State tax, 
fee, or royalty paid by the coal producer. 
(2) COAL PRODUCERS.—With respect to coal 
producers, this section shall not confer standing 
upon a coal producer to commence, or intervene in, 
any judicial or administrative proceeding concerning 
a claim for refund by an exporter of any Federal or 
State tax, fee, or royalty paid by the producer and 
alleged to have been passed on to an exporter. 
SEC. 815. CARBON AUDIT OF THE TAX CODE. 
(a) STUDY.—The Secretary of the Treasury shall 
enter into an agreement with the National Academy of 
Sciences to undertake a comprehensive review of the Inter-
nal Revenue Code of 1986 to identify the types of and 
specific tax provisions that have the largest effects on car-
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231 
bon and other greenhouse gas emissions and to estimate 
the magnitude of those effects. 
(b) REPORT.—Not later than 2 years after the date 
of enactment of this Act, the National Academy of 
Sciences shall submit to Congress a report containing the 
results of study authorized under this section. 
(c) AUTHORIZATION OF APPROPRIATIONS.—There is 
authorized to be appropriated to carry out this section 
$1,500,000 for the period of fiscal years 2009 and 2010. 
Subtitle B—Transportation and 
Domestic Fuel Security Provisions 
SEC. 821. INCLUSION OF CELLULOSIC BIOFUEL IN BONUS 
DEPRECIATION 
FOR 
BIOMASS 
ETHANOL 
PLANT PROPERTY. 
(a) IN GENERAL.—Paragraph (3) of section 168(l) 
is amended to read as follows: 
‘‘(3) CELLULOSIC
BIOFUEL.—The term ‘cel-
lulosic biofuel’ means any liquid fuel which is pro-
duced from any lignocellulosic or hemicellulosic mat-
ter that is available on a renewable or recurring 
basis.’’. 
(b) CONFORMING AMENDMENTS.—Subsection (l) of 
section 168 is amended— 
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(1) by striking ‘‘cellulosic biomass ethanol’’ 
each place it appears and inserting ‘‘cellulosic 
biofuel’’, 
(2) by striking ‘‘CELLULOSIC BIOMASS ETH-
ANOL’’ in the heading of such subsection and insert-
ing ‘‘CELLULOSIC BIOFUEL’’, and 
(3) by striking ‘‘CELLULOSIC
BIOMASS
ETH-
ANOL’’ in the heading of paragraph (2) thereof and 
inserting ‘‘CELLULOSIC BIOFUEL’’. 
(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, in taxable years 
ending after such date. 
SEC. 822. CREDITS FOR BIODIESEL AND RENEWABLE DIE-
SEL. 
(a) IN GENERAL.—Sections 40A(g), 6426(c)(6), and 
6427(e)(5)(B) are each amended by striking ‘‘December 
31, 2008’’ and inserting ‘‘December 31, 2009’’. 
(b) INCREASE IN RATE OF CREDIT.— 
(1) INCOME TAX CREDIT.—Paragraphs (1)(A) 
and (2)(A) of section 40A(b) are each amended by 
striking ‘‘50 cents’’ and inserting ‘‘$1.00’’. 
(2) EXCISE
TAX
CREDIT.—Paragraph (2) of 
section 6426(c) is amended to read as follows: 
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233 
‘‘(2) APPLICABLE AMOUNT.—For purposes of 
this subsection, the applicable amount is $1.00.’’. 
(3) CONFORMING AMENDMENTS.— 
(A) Subsection (b) of section 40A is 
amended by striking paragraph (3) and by re-
designating paragraphs (4) and (5) as para-
graphs (3) and (4), respectively. 
(B) Paragraph (2) of section 40A(f) is 
amended to read as follows: 
‘‘(2) EXCEPTION.—Subsection (b)(4) shall not 
apply with respect to renewable diesel.’’. 
(C) Paragraphs (2) and (3) of section 
40A(e) are each amended by striking ‘‘sub-
section (b)(5)(C)’’ and inserting ‘‘subsection 
(b)(4)(C)’’. 
(D) Clause (ii) of section 40A(d)(3)(C) is 
amended by striking ‘‘subsection (b)(5)(B)’’ 
and inserting ‘‘subsection (b)(4)(B)’’. 
(c) UNIFORM TREATMENT OF DIESEL PRODUCED 
FROM BIOMASS.—Paragraph (3) of section 40A(f) is 
amended— 
(1) by striking ‘‘diesel fuel’’ and inserting ‘‘liq-
uid fuel’’, 
(2) 
by 
striking 
‘‘using 
a 
thermal 
depolymerization process’’, and 
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(3) by striking ‘‘or D396’’ in subparagraph (B) 
and inserting ‘‘, D396, or other equivalent standard 
approved by the Secretary’’. 
(d) COPRODUCTION OF RENEWABLE DIESEL WITH 
PETROLEUM FEEDSTOCK.— 
(1) IN
GENERAL.—Paragraph (3) of section 
40A(f) (defining renewable diesel) is amended by 
adding at the end the following flush sentence: 
‘‘Such term does not include any fuel derived from 
coprocessing biomass with a feedstock which is not 
biomass. For purposes of this paragraph, the term 
‘biomass’ has the meaning given such term by sec-
tion 45K(c)(3).’’. 
(2) CONFORMING AMENDMENT.—Paragraph (3) 
of section 40A(f) is amended by striking ‘‘(as de-
fined in section 45K(c)(3))’’. 
(e) ELIGIBILITY OF CERTAIN AVIATION FUEL.—Sub-
section (f) of section 40A (relating to renewable diesel) 
is amended by adding at the end the following new para-
graph: 
‘‘(4) CERTAIN AVIATION FUEL.— 
‘‘(A) IN GENERAL.—Except as provided in 
the last three sentences of paragraph (3), the 
term ‘renewable diesel’ shall include fuel derived 
from biomass which meets the requirements of 
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a Department of Defense specification for mili-
tary jet fuel or an American Society of Testing 
and Materials specification for aviation turbine 
fuel. 
‘‘(B) APPLICATION
OF
MIXTURE
CRED-
ITS.—In the case of fuel which is treated as re-
newable diesel solely by reason of subparagraph 
(A), subsection (b)(1) and section 6426(c) shall 
be applied with respect to such fuel by treating 
kerosene as though it were diesel fuel.’’. 
(f) EFFECTIVE DATE.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendments made by 
this section shall apply to fuel produced, and sold or 
used, after December 31, 2008. 
(2) COPRODUCTION
OF
RENEWABLE
DIESEL 
WITH PETROLEUM FEEDSTOCK.—The amendments 
made by subsection (c) shall apply to fuel produced, 
and sold or used, after February 13, 2008. 
SEC. 823. CLARIFICATION THAT CREDITS FOR FUEL ARE 
DESIGNED TO PROVIDE AN INCENTIVE FOR 
UNITED STATES PRODUCTION. 
(a) ALCOHOL FUELS CREDIT.—Subsection (d) of 
section 40 is amended by adding at the end the following 
new paragraph: 
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‘‘(7) LIMITATION TO ALCOHOL WITH CONNEC-
TION TO THE UNITED STATES.—No credit shall be 
determined under this section with respect to any al-
cohol which is produced outside the United States 
for use as a fuel outside the United States. For pur-
poses of this paragraph, the term ‘United States’ in-
cludes any possession of the United States.’’. 
(b) BIODIESEL FUELS CREDIT.—Subsection (d) of 
section 40A is amended by adding at the end the following 
new paragraph: 
‘‘(5) LIMITATION TO BIODIESEL WITH CONNEC-
TION TO THE UNITED STATES.—No credit shall be 
determined under this section with respect to any 
biodiesel which is produced outside the United 
States for use as a fuel outside the United States. 
For purposes of this paragraph, the term ‘United 
States’ includes any possession of the United 
States.’’. 
(c) EXCISE TAX CREDIT.— 
(1) IN GENERAL.—Section 6426 is amended by 
adding at the end the following new subsection: 
‘‘(i) LIMITATION TO FUELS WITH CONNECTION TO 
THE UNITED STATES.— 
‘‘(1) ALCOHOL.—No credit shall be determined 
under this section with respect to any alcohol which 
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237 
is produced outside the United States for use as a 
fuel outside the United States. 
‘‘(2) BIODIESEL AND ALTERNATIVE FUELS.— 
No credit shall be determined under this section 
with respect to any biodiesel or alternative fuel 
which is produced outside the United States for use 
as a fuel outside the United States. 
For purposes of this subsection, the term ‘United States’ 
includes any possession of the United States.’’. 
(2) CONFORMING AMENDMENT.—Subsection (e) 
of section 6427 is amended by redesignating para-
graph (5) as paragraph (6) and by inserting after 
paragraph (4) the following new paragraph: 
‘‘(5) LIMITATION TO FUELS WITH CONNECTION 
TO THE UNITED STATES.—No amount shall be pay-
able under paragraph (1) or (2) with respect to any 
mixture or alternative fuel if credit is not allowed 
with respect to such mixture or alternative fuel by 
reason of section 6426(i).’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to claims for credit or payment 
made on or after May 15, 2008. 
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238 
SEC. 824. CREDIT FOR NEW QUALIFIED PLUG-IN ELECTRIC 
DRIVE MOTOR VEHICLES. 
(a) IN GENERAL.—Section 30 is amended to read as 
follows: 
‘‘SEC. 30. NEW QUALIFIED PLUG-IN ELECTRIC DRIVE 
MOTOR VEHICLES. 
‘‘(a) ALLOWANCE OF CREDIT.—There shall be al-
lowed as a credit against the tax imposed by this chapter 
for the taxable year an amount equal to the sum of the 
credit amounts determined under subsection (b) with re-
spect to each new qualified plug-in electric drive motor ve-
hicle placed in service by the taxpayer during the taxable 
year. 
‘‘(b) PER VEHICLE DOLLAR LIMITATION.— 
‘‘(1) IN
GENERAL.—The amount determined 
under this subsection with respect to any new quali-
fied plug-in electric drive motor vehicle is the sum 
of the amounts determined under paragraphs (2) 
and (3) with respect to such vehicle. 
‘‘(2) BASE AMOUNT.—The amount determined 
under this paragraph is $3,000. 
‘‘(3) BATTERY CAPACITY.—In the case of a ve-
hicle which draws propulsion energy from a battery 
with not less than 5 kilowatt hours of capacity, the 
amount determined under this paragraph is $200, 
plus $200 for each kilowatt hour of capacity in ex-
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239 
cess of 5 kilowatt hours. The amount determined 
under this paragraph shall not exceed $2,000. 
‘‘(c) APPLICATION WITH OTHER CREDITS.— 
‘‘(1) BUSINESS CREDIT TREATED AS PART OF 
GENERAL BUSINESS CREDIT.—So much of the credit 
which would be allowed under subsection (a) for any 
taxable year (determined without regard to this sub-
section) that is attributable to property of a char-
acter subject to an allowance for depreciation shall 
be treated as a credit listed in section 38(b) for such 
taxable year (and not allowed under subsection (a)). 
‘‘(2) PERSONAL CREDIT.— 
‘‘(A) IN GENERAL.—For purposes of this 
title, the credit allowed under subsection (a) for 
any taxable year (determined after application 
of paragraph (1)) shall be treated as a credit 
allowable under subpart A for such taxable 
year. 
‘‘(B) LIMITATION BASED ON AMOUNT OF 
TAX.—In the case of a taxable year to which 
section 26(a)(2) does not apply, the credit al-
lowed under subsection (a) for any taxable year 
(determined after application of paragraph (1)) 
shall not exceed the excess of— 
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‘‘(i) the sum of the regular tax liabil-
ity (as defined in section 26(b)) plus the 
tax imposed by section 55, over 
‘‘(ii) the sum of the credits allowable 
under subpart A (other than this section 
and sections 23 and 25D) and section 27 
for the taxable year. 
‘‘(d) NEW QUALIFIED PLUG-IN ELECTRIC DRIVE 
MOTOR VEHICLE.—For purposes of this section— 
‘‘(1) IN
GENERAL.—The term ‘new qualified 
plug-in electric drive motor vehicle’ means a motor 
vehicle— 
‘‘(A) the original use of which commences 
with the taxpayer, 
‘‘(B) which is acquired for use or lease by 
the taxpayer and not for resale, 
‘‘(C) which is made by a manufacturer, 
‘‘(D) which has a gross vehicle weight rat-
ing of less than 14,000 pounds, 
‘‘(E) which has received a certificate of 
conformity under the Clean Air Act and meets 
or exceeds the Bin 5 Tier II emission standard 
established in regulations prescribed by the Ad-
ministrator of the Environmental Protection 
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241 
Agency under section 202(i) of the Clean Air 
Act for that make and model year vehicle, and 
‘‘(F) which is propelled to a significant ex-
tent by an electric motor which draws electricity 
from a battery which— 
‘‘(i) has a capacity of not less than 4 
kilowatt hours, and 
‘‘(ii) is capable of being recharged 
from an external source of electricity. 
‘‘(2) EXCEPTION.—The term ‘new qualified 
plug-in electric drive motor vehicle’ shall not include 
any vehicle which is not a passenger automobile or 
light truck if such vehicle has a gross vehicle weight 
rating of less than 8,500 pounds. 
‘‘(3) MOTOR VEHICLE.—The term ‘motor vehi-
cle’ means any vehicle which is manufactured pri-
marily for use on public streets, roads, and highways 
(not including a vehicle operated exclusively on a rail 
or rails) and which has at least 4 wheels. 
‘‘(4) OTHER
TERMS.—The terms ‘passenger 
automobile’, ‘light truck’, and ‘manufacturer’ have 
the meanings given such terms in regulations pre-
scribed by the Administrator of the Environmental 
Protection Agency for purposes of the administra-
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242 
tion of title II of the Clean Air Act (42 U.S.C. 7521 
et seq.). 
‘‘(5) BATTERY CAPACITY.—The term ‘capacity’ 
means, with respect to any battery, the quantity of 
electricity which the battery is capable of storing, ex-
pressed in kilowatt hours, as measured from a 100 
percent state of charge to a 0 percent state of 
charge. 
‘‘(e) LIMITATION ON NUMBER OF NEW QUALIFIED 
PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES ELIGIBLE 
FOR CREDIT.— 
‘‘(1) IN GENERAL.—In the case of a new quali-
fied plug-in electric drive motor vehicle sold during 
the phaseout period, only the applicable percentage 
of the credit otherwise allowable under subsection 
(a) shall be allowed. 
‘‘(2) PHASEOUT PERIOD.—For purposes of this 
subsection, the phaseout period is the period begin-
ning with the second calendar quarter following the 
calendar quarter which includes the first date on 
which the number of new qualified plug-in electric 
drive motor vehicles manufactured by the manufac-
turer of the vehicle referred to in paragraph (1) sold 
for use in the United States after the date of the en-
actment of this section, is at least 60,000. 
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243 
‘‘(3) APPLICABLE PERCENTAGE.—For purposes 
of paragraph (1), the applicable percentage is— 
‘‘(A) 50 percent for the first 2 calendar 
quarters of the phaseout period, 
‘‘(B) 25 percent for the 3d and 4th cal-
endar quarters of the phaseout period, and 
‘‘(C) 0 percent for each calendar quarter 
thereafter. 
‘‘(4) CONTROLLED GROUPS.—Rules similar to 
the rules of section 30B(f)(4) shall apply for pur-
poses of this subsection. 
‘‘(f) SPECIAL RULES.— 
‘‘(1) BASIS
REDUCTION.—The basis of any 
property for which a credit is allowable under sub-
section (a) shall be reduced by the amount of such 
credit (determined without regard to subsection (c)). 
‘‘(2) RECAPTURE.—The Secretary shall, by reg-
ulations, provide for recapturing the benefit of any 
credit allowable under subsection (a) with respect to 
any property which ceases to be property eligible for 
such credit. 
‘‘(3) 
PROPERTY
USED
OUTSIDE
UNITED 
STATES, ETC., NOT QUALIFIED.—No credit shall be 
allowed under subsection (a) with respect to any 
property referred to in section 50(b)(1) or with re-
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244 
spect to the portion of the cost of any property 
taken into account under section 179. 
‘‘(4) ELECTION
NOT
TO
TAKE
CREDIT.—No 
credit shall be allowed under subsection (a) for any 
vehicle if the taxpayer elects to not have this section 
apply to such vehicle. 
‘‘(5) PROPERTY USED BY TAX-EXEMPT ENTITY; 
INTERACTION WITH AIR QUALITY AND MOTOR VEHI-
CLE SAFETY STANDARDS.—Rules similar to the rules 
of paragraphs (6) and (10) of section 30B(h) shall 
apply for purposes of this section.’’. 
(b) COORDINATION WITH ALTERNATIVE MOTOR VE-
HICLE CREDIT.—Section 30B(d)(3) is amended by adding 
at the end the following new subparagraph: 
‘‘(D) EXCLUSION OF PLUG-IN VEHICLES.— 
Any vehicle with respect to which a credit is al-
lowable under section 30 (determined without 
regard to subsection (c) thereof) shall not be 
taken into account under this section.’’. 
(c) CREDIT MADE PART OF GENERAL BUSINESS 
CREDIT.—Section 38(b) is amended by striking ‘‘plus’’ at 
the end of paragraph (32), by striking the period at the 
end of paragraph (33) and inserting ‘‘, plus’’, and by add-
ing at the end the following new paragraph: 
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‘‘(34) the portion of the new qualified plug-in 
electric drive motor vehicle credit to which section 
30(c)(1) applies.’’. 
(d) CONFORMING AMENDMENTS.— 
(1)(A) Section 24(b)(3)(B), as amended by sec-
tion 804, is amended by striking ‘‘and 25D’’ and in-
serting ‘‘25D, and 30’’. 
(B) Section 25(e)(1)(C)(ii) is amended by in-
serting ‘‘30,’’ after ‘‘25D,’’. 
(C) Section 25B(g)(2), as amended by section 
804, is amended by striking ‘‘and 25D’’ and insert-
ing ‘‘, 25D, and 30’’. 
(D) Section 26(a)(1), as amended by section 
804, is amended by striking ‘‘and 25D’’ and insert-
ing ‘‘25D, and 30’’. 
(E) Section 1400C(d)(2) is amended by striking 
‘‘and 25D’’ and inserting ‘‘25D, and 30’’. 
(2) Section 30B(h)(1) is amended by striking 
‘‘section 30(c)(2)’’ and inserting ‘‘section 30(d)(3)’’. 
(3)(A) Section 53(d)(1)(B) is amended by strik-
ing clause (iii) and redesignating clause (iv) as 
clause (iii). 
(B) Subclause (II) of section 53(d)(1)(B)(iii), 
as so redesignated, is amended by striking ‘‘in-
creased in the manner provided in clause (iii)’’. 
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246 
(4) Section 55(c)(3) is amended by striking 
‘‘30(b)(3),’’. 
(5) Section 1016(a)(25) is amended by striking 
‘‘section 30(d)(1)’’ and inserting ‘‘section 30(f)(1)’’. 
(6) Section 6501(m) is amended by striking 
‘‘section 30(d)(4)’’ and inserting ‘‘section 30(f)(4)’’. 
(7) The item in the table of sections for subpart 
B of part IV of subchapter A of chapter 1 is amend-
ed to read as follows: 
‘‘Sec. 30. New qualified plug-in electric drive motor vehicles.’’. 
(e) TREATMENT OF ALTERNATIVE MOTOR VEHICLE 
CREDIT AS A PERSONAL CREDIT.— 
(1) IN
GENERAL.—Paragraph (2) of section 
30B(g) is amended to read as follows: 
‘‘(2) PERSONAL
CREDIT.—The credit allowed 
under subsection (a) for any taxable year (after ap-
plication of paragraph (1)) shall be treated as a 
credit allowable under subpart A for such taxable 
year.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Subparagraph (A) of section 30C(d)(2) 
is amended by striking ‘‘sections 27, 30, and 
30B’’ and inserting ‘‘section 27’’. 
(B) Paragraph (3) of section 55(c) is 
amended by striking ‘‘30B(g)(2),’’. 
(f) EFFECTIVE DATE.— 
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(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendments made by 
this section shall apply to taxable years beginning 
after December 31, 2008. 
(2) TREATMENT OF ALTERNATIVE MOTOR VE-
HICLE CREDIT AS PERSONAL CREDIT.—The amend-
ments made by subsection (e) shall apply to taxable 
years beginning after December 31, 2007. 
(g) APPLICATION
OF
EGTRRA SUNSET.—The 
amendment made by subsection (d)(1)(A) shall be subject 
to title IX of the Economic Growth and Tax Relief Rec-
onciliation Act of 2001 in the same manner as the provi-
sion of such Act to which such amendment relates. 
SEC. 825. EXCLUSION FROM HEAVY TRUCK TAX FOR IDLING 
REDUCTION UNITS AND ADVANCED INSULA-
TION. 
(a) IN GENERAL.—Section 4053 is amended by add-
ing at the end the following new paragraphs: 
‘‘(9) IDLING REDUCTION DEVICE.—Any device 
or system of devices which— 
‘‘(A) is designed to provide to a vehicle 
those services (such as heat, air conditioning, or 
electricity) that would otherwise require the op-
eration of the main drive engine while the vehi-
cle is temporarily parked or remains stationary 
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248 
using one or more devices affixed to a tractor, 
and 
‘‘(B) is determined by the Administrator of 
the Environmental Protection Agency, in con-
sultation with the Secretary of Energy and the 
Secretary of Transportation, to reduce idling of 
such vehicle at a motor vehicle rest stop or 
other location where such vehicles are tempo-
rarily parked or remain stationary. 
‘‘(10) ADVANCED INSULATION.—Any insulation 
that has an R value of not less than R35 per inch.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to sales or installations after the 
date of the enactment of this Act. 
SEC. 826. RESTRUCTURING OF NEW YORK LIBERTY ZONE 
TAX CREDITS. 
(a) IN GENERAL.—Part I of subchapter Y of chapter 
1 is amended by redesignating section 1400L as section 
1400K and by adding at the end the following new section: 
‘‘SEC. 1400L. NEW YORK LIBERTY ZONE TAX CREDITS. 
‘‘(a) IN GENERAL.—In the case of a New York Lib-
erty Zone governmental unit, there shall be allowed as a 
credit against any taxes imposed for any payroll period 
by section 3402 for which such governmental unit is liable 
under section 3403 an amount equal to so much of the 
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249 
portion of the qualifying project expenditure amount allo-
cated under subsection (b)(3) to such governmental unit 
for the calendar year as is allocated by such governmental 
unit to such period under subsection (b)(4). 
‘‘(b) 
QUALIFYING
PROJECT
EXPENDITURE 
AMOUNT.—For purposes of this section— 
‘‘(1) 
IN
GENERAL.—The 
term 
‘qualifying 
project expenditure amount’ means, with respect to 
any calendar year, the sum of— 
‘‘(A) the total expenditures paid or in-
curred during such calendar year by all New 
York Liberty Zone governmental units and the 
Port Authority of New York and New Jersey 
for any portion of qualifying projects located 
wholly within the City of New York, New York, 
and 
‘‘(B) any such expenditures— 
‘‘(i) paid or incurred in any preceding 
calendar year which begins after the date 
of enactment of this section, and 
‘‘(ii) not previously allocated under 
paragraph (3). 
‘‘(2) QUALIFYING PROJECT.—The term ‘quali-
fying project’ means any transportation infrastruc-
ture project, including highways, mass transit sys-
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250 
tems, railroads, airports, ports, and waterways, in or 
connecting with the New York Liberty Zone (as de-
fined in section 1400K(h)), which is designated as a 
qualifying project under this section jointly by the 
Governor of the State of New York and the Mayor 
of the City of New York, New York. 
‘‘(3) GENERAL ALLOCATION.— 
‘‘(A) IN GENERAL.—The Governor of the 
State of New York and the Mayor of the City 
of New York, New York, shall jointly allocate to 
each New York Liberty Zone governmental unit 
the portion of the qualifying project expenditure 
amount which may be taken into account by 
such governmental unit under subsection (a) for 
any calendar year in the credit period. 
‘‘(B) AGGREGATE LIMIT.—The aggregate 
amount which may be allocated under subpara-
graph (A) for all calendar years in the credit 
period shall not exceed $2,000,000,000. 
‘‘(C) 
ANNUAL
LIMIT.—The 
aggregate 
amount which may be allocated under subpara-
graph (A) for any calendar year in the credit 
period shall not exceed the sum of— 
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‘‘(i) $115,000,000 ($425,000,000 in 
the case of the last 2 years in the credit 
period), plus 
‘‘(ii) the aggregate amount authorized 
to be allocated under this paragraph for all 
preceding calendar years in the credit pe-
riod which was not so allocated. 
‘‘(D) UNALLOCATED AMOUNTS AT END OF 
CREDIT PERIOD.—If, as of the close of the cred-
it period, the amount under subparagraph (B) 
exceeds the aggregate amount allocated under 
subparagraph (A) for all calendar years in the 
credit period, the Governor of the State of New 
York and the Mayor of the City of New York, 
New York, may jointly allocate to New York 
Liberty Zone governmental units for any cal-
endar year in the 5-year period following the 
credit period an amount equal to— 
‘‘(i) the lesser of— 
‘‘(I) such excess, or 
‘‘(II) the qualifying project ex-
penditure amount for such calendar 
year, reduced by 
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252 
‘‘(ii) the aggregate amount allocated 
under this subparagraph for all preceding 
calendar years. 
‘‘(4) ALLOCATION
TO
PAYROLL
PERIODS.— 
Each New York Liberty Zone governmental unit 
which has been allocated a portion of the qualifying 
project expenditure amount under paragraph (3) for 
a calendar year may allocate such portion to payroll 
periods beginning in such calendar year as such gov-
ernmental unit determines appropriate. 
‘‘(c) CARRYOVER OF UNUSED ALLOCATIONS.— 
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), if the amount allocated under subsection 
(b)(3) to a New York Liberty Zone governmental 
unit for any calendar year exceeds the aggregate 
taxes imposed by section 3402 for which such gov-
ernmental unit is liable under section 3403 for peri-
ods beginning in such year, such excess shall be car-
ried to the succeeding calendar year and added to 
the allocation of such governmental unit for such 
succeeding calendar year. 
‘‘(2) REALLOCATION.—If a New York Liberty 
Zone governmental unit does not use an amount al-
located to it under subsection (b)(3) within the time 
prescribed by the Governor of the State of New York 
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253 
and the Mayor of the City of New York, New York, 
then such amount shall after such time be treated 
for purposes of subsection (b)(3) in the same man-
ner as if it had never been allocated. 
‘‘(d) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
‘‘(1) CREDIT PERIOD.—The term ‘credit period’ 
means the 12-year period beginning on January 1, 
2009. 
‘‘(2) NEW
YORK
LIBERTY
ZONE
GOVERN-
MENTAL UNIT.—The term ‘New York Liberty Zone 
governmental unit’ means— 
‘‘(A) the State of New York, 
‘‘(B) the City of New York, New York, and 
‘‘(C) any agency or instrumentality of such 
State or City. 
‘‘(3) TREATMENT OF FUNDS.—Any expenditure 
for a qualifying project taken into account for pur-
poses of the credit under this section shall be consid-
ered State and local funds for the purpose of any 
Federal program. 
‘‘(4) TREATMENT
OF
CREDIT
AMOUNTS
FOR 
PURPOSES OF WITHHOLDING TAXES.—For purposes 
of this title, a New York Liberty Zone governmental 
unit shall be treated as having paid to the Secretary, 
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254 
on the day on which wages are paid to employees, 
an amount equal to the amount of the credit allowed 
to such entity under subsection (a) with respect to 
such wages, but only if such governmental unit de-
ducts and withholds wages for such payroll period 
under section 3401 (relating to wage withholding). 
‘‘(e) REPORTING.—The Governor of the State of New 
York and the Mayor of the City of New York, New York, 
shall jointly submit to the Secretary an annual report— 
‘‘(1) which certifies— 
‘‘(A) the qualifying project expenditure 
amount for the calendar year, and 
‘‘(B) the amount allocated to each New 
York Liberty Zone governmental unit under 
subsection (b)(3) for the calendar year, and 
‘‘(2) includes such other information as the 
Secretary may require to carry out this section. 
‘‘(f) GUIDANCE.—The Secretary may prescribe such 
guidance as may be necessary or appropriate to ensure 
compliance with the purposes of this section.’’. 
(b) TERMINATION OF SPECIAL ALLOWANCE AND EX-
PENSING.—Subparagraph (A) of section 1400K(b)(2), as 
redesignated by subsection (a), is amended by striking the 
parenthetical therein and inserting ‘‘(in the case of non-
residential real property and residential rental property, 
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255 
the date of the enactment of the Energy Tax Incentives 
Act of 2008 or, if acquired pursuant to a binding contract 
in effect on such enactment date, December 31, 2009)’’. 
(c) CONFORMING AMENDMENTS.— 
(1) Section 38(c)(3)(B) is amended by striking 
‘‘section 
1400L(a)’’ 
and 
inserting 
‘‘section 
1400K(a)’’. 
(2) Section 168(k)(2)(D)(ii) is amended by 
striking ‘‘section 1400L(c)(2)’’ and inserting ‘‘sec-
tion 1400K(c)(2)’’. 
(3) The table of sections for part I of sub-
chapter Y of chapter 1 is amended by redesignating 
the item relating to section 1400L as an item relat-
ing to section 1400K and by inserting after such 
item the following new item: 
‘‘Sec. 1400L. New York Liberty Zone tax credits.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the date of the enactment 
of this Act. 
SEC. 827. TRANSPORTATION FRINGE BENEFIT TO BICYCLE 
COMMUTERS. 
(a) IN GENERAL.—Paragraph (1) of section 132(f) 
is amended by adding at the end the following: 
‘‘(D) Any qualified bicycle commuting re-
imbursement.’’. 
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256 
(b) LIMITATION ON EXCLUSION.—Paragraph (2) of 
section 132(f) is amended by striking ‘‘and’’ at the end 
of subparagraph (A), by striking the period at the end 
of subparagraph (B) and inserting ‘‘, and’’, and by adding 
at the end the following new subparagraph: 
‘‘(C) the applicable annual limitation in 
the case of any qualified bicycle commuting re-
imbursement.’’. 
(c) DEFINITIONS.—Paragraph (5) of section 132(f) 
is amended by adding at the end the following: 
‘‘(F) DEFINITIONS RELATED TO BICYCLE 
COMMUTING REIMBURSEMENT.— 
‘‘(i) QUALIFIED BICYCLE COMMUTING 
REIMBURSEMENT.—The term ‘qualified bi-
cycle commuting reimbursement’ means, 
with respect to any calendar year, any em-
ployer reimbursement during the 15-month 
period beginning with the first day of such 
calendar year for reasonable expenses in-
curred by the employee during such cal-
endar year for the purchase of a bicycle 
and bicycle improvements, repair, and stor-
age, if such bicycle is regularly used for 
travel between the employee’s residence 
and place of employment. 
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257 
‘‘(ii) APPLICABLE
ANNUAL
LIMITA-
TION.—The term ‘applicable annual limita-
tion’ means, with respect to any employee 
for any calendar year, the product of $20 
multiplied by the number of qualified bicy-
cle commuting months during such year. 
‘‘(iii) 
QUALIFIED
BICYCLE
COM-
MUTING MONTH.—The term ‘qualified bi-
cycle commuting month’ means, with re-
spect to any employee, any month during 
which such employee— 
‘‘(I) regularly uses the bicycle for 
a substantial portion of the travel be-
tween the employee’s residence and 
place of employment, and 
‘‘(II) does not receive any benefit 
described in subparagraph (A), (B), 
or (C) of paragraph (1).’’. 
(d) CONSTRUCTIVE RECEIPT OF BENEFIT.—Para-
graph (4) of section 132(f) is amended by inserting 
‘‘(other than a qualified bicycle commuting reimburse-
ment)’’ after ‘‘qualified transportation fringe’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
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258 
SEC. 828. ALTERNATIVE FUEL VEHICLE REFUELING PROP-
ERTY CREDIT. 
(a) INCREASE IN CREDIT AMOUNT.—Section 30C is 
amended— 
(1) by striking ‘‘30 percent’’ in subsection (a) 
and inserting ‘‘50 percent’’, 
(2) by striking ‘‘$30,000’’ in subsection (b)(1) 
and inserting ‘‘$50,000’’, and 
(3) by striking ‘‘$1,000’’ in subsection (b)(2) 
and inserting ‘‘$2,000’’. 
(b) EXTENSION OF CREDIT.—Subsection (g) of sec-
tion 30C is amended— 
(1) by redesignating paragraphs (1) and (2) as 
paragraphs (2) and (3) and inserting before para-
graph (2) (as so redesignated) the following new 
paragraph: 
‘‘(1) in the case of property relating to natural 
gas, compressed natural gas, or liquified natural gas, 
and which is not of a character subject to an allow-
ance for depreciation, December 31, 2017,’’, and 
(2) by striking ‘‘December 31, 2009’’ in para-
graph (3) (as so redesignated) and inserting ‘‘De-
cember 31, 2010’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
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259 
the date of the enactment of this Act, in taxable years 
ending after such date. 
SEC. 829. ENERGY SECURITY BONDS. 
(a) IN GENERAL.—Subpart I of part IV of sub-
chapter A of chapter 1, as amended by sections 806 and 
841, is amended by adding at the end the following new 
section: 
‘‘SEC. 54E. ENERGY SECURITY BONDS. 
‘‘(a) ENERGY SECURITY BOND.—For purposes of 
this subchapter, the term ‘energy security bond’ means 
any bond issued as part of an issue if— 
‘‘(1) 100 percent of the available project pro-
ceeds of such issue are to be used for qualified pur-
poses, 
‘‘(2) the bond is issued by a qualified issuer, 
‘‘(3) the issuer designates such bond for pur-
poses of this section, and 
‘‘(4) repayments of principal and applicable in-
terest on financing provided by the issue are used 
not later than the close of the 3-month period begin-
ning on the date the repayment (or complete repay-
ment) is received— 
‘‘(A) to redeem bonds which are part of 
the issue, or 
‘‘(B) for any qualified purpose. 
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260 
For purposes of paragraph (4), the term ‘applicable inter-
est’ means so much of the interest on any loan as exceeds 
the amount payable at a 1 percent rate. 
‘‘(b) QUALIFIED PURPOSE.—For purposes of this 
section— 
‘‘(1) IN GENERAL.—The term ‘qualified pur-
pose’ means the making of grants and low-interest 
loans for the purpose of placing in service natural 
gas refueling property at retail motor fuel stations 
located in the United States. 
‘‘(2) LIMITATION ON LOANS.—Such term shall 
not include— 
‘‘(A) any loan of more than $200,000 for 
property located at any one retail motor fuel 
station, and 
‘‘(B) any loan for more than 50 percent of 
the cost of such property and its installation. 
‘‘(3) NATURAL GAS REFUELING PROPERTY.— 
The term ‘natural gas refueling property’ means 
qualified clean-fuel refueling property (as defined in 
section 179A(d)) which is described in section 
179A(d)(3) with respect to natural gas fuel. 
‘‘(4) LOW-INTEREST LOAN.—The term ‘low-in-
terest loan’ means any loan the rate of interest on 
which does not exceed the applicable Federal rate in 
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261 
effect under section 1288(b)(1) determined as of the 
issuance of the loan. 
‘‘(c) LIMITATION
ON AMOUNT
OF BONDS DES-
IGNATED.—The maximum aggregate face amount of 
bonds which may be designated under subsection (a) by 
any issuer shall not exceed the limitation amount allocated 
to such issuer under subsection (e). 
‘‘(d) NATIONAL LIMITATION ON AMOUNT OF BONDS 
DESIGNATED.—There is a national energy security bond 
limitation of $1,750,000,000. 
‘‘(e) ALLOCATION.— 
‘‘(1) IN GENERAL.—The Secretary shall make 
allocations of the amount of the national energy se-
curity bond limitation under subsection (d) among 
qualified issuers in such manner as the Secretary de-
termines appropriate. 
‘‘(2) RESERVATION FOR PROPERTY IN METRO-
POLITAN AREA.—50 percent of the national energy 
security bond limitation under subsection (d) may be 
allocated only for loans to provide natural gas refuel-
ing property located in metropolitan statistical areas 
(within the meaning of section 143(k)(2)(B)). 
‘‘(3) PERCENTAGE
OF
STATIONS
RECEIVING 
LOANS.—In making allocations under paragraph (1), 
the Secretary shall attempt to ensure that at least 
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262 
10 percent of the retail motor fuel stations in the 
United States received loans from the proceeds of 
energy security bonds. 
‘‘(f) QUALIFIED ISSUER.—For purposes of this sec-
tion, the term ‘qualified issuer’ means any State or any 
political subdivision or instrumentality thereof. 
‘‘(g) TERMINATION.—This section shall not apply 
with respect to any bond issued after December 31, 
2017.’’. 
(b) COORDINATION WITH REFUELING PROPERTY 
CREDIT.—Subsection (e) of section 30C of such Code is 
amended by adding at the end the following new para-
graph: 
‘‘(6) COORDINATION WITH ENERGY SECURITY 
BONDS.—The cost otherwise taken into account 
under this section with respect to any property shall 
be reduced by the portion of such cost which is fi-
nanced by any loan provided from the proceeds of 
any energy security bond (as defined in section 
54E).’’. 
(c) CONFORMING AMENDMENTS.— 
(1) Paragraph (1) of section 54A(d), as amend-
ed by sections 806 and 841, is amended by striking 
‘‘or’’ at the end of subparagraph (B), by adding 
‘‘or’’ at the end of subparagraph (C), and by insert-
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263 
ing after subparagraph (C) the following new sub-
paragraph: 
‘‘(D) an energy security bond,’’. 
(2) Subparagraph (C) of section 54A(d)(2), as 
amended by sections 806 and 841, is amended by 
striking ‘‘and’’ at the end of clause (ii), by striking 
the period at the end of clause (iii) and inserting 
‘‘and’’, and by adding at the end the following new 
clause: 
‘‘(iv) in the case of an energy security 
bond, a purpose specified in section 
54E(b).’’. 
(3) The table of sections for subpart I of part 
IV of subchapter A of chapter 1, as amended by sec-
tions 806 and 841, is amended by adding at the end 
the following new item: 
‘‘Sec. 54E. Energy security bonds.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to obligations issued after Decem-
ber 31, 2008. 
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264 
SEC. 830. CERTAIN INCOME AND GAINS RELATING TO AL-
COHOL FUELS AND MIXTURES, BIODIESEL 
FUELS AND MIXTURES, AND ALTERNATIVE 
FUELS AND MIXTURES TREATED AS QUALI-
FYING 
INCOME 
FOR 
PUBLICLY 
TRADED 
PARTNERSHIPS. 
(a) IN GENERAL.—Subparagraph (E) of section 
7704(d)(1) is amended by inserting ‘‘, or the transpor-
tation or storage of any fuel described in subsection (b), 
(c), (d), or (e) of section 6426, or any alcohol fuel defined 
in section 6426(b)(4)(A) or any biodiesel fuel as defined 
in section 40A(d)(1)’’ after ‘‘timber)’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
Subtitle C—Energy Conservation 
and Efficiency Provisions 
SEC. 841. QUALIFIED ENERGY CONSERVATION BONDS. 
(a) IN GENERAL.—Subpart I of part IV of sub-
chapter A of chapter 1, as amended by section 806, is 
amended by adding at the end the following new section: 
‘‘SEC. 54D. QUALIFIED ENERGY CONSERVATION BONDS. 
‘‘(a) QUALIFIED ENERGY CONSERVATION BOND.— 
For purposes of this subchapter, the term ‘qualified en-
ergy conservation bond’ means any bond issued as part 
of an issue if— 
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‘‘(1) 100 percent of the available project pro-
ceeds of such issue are to be used for one or more 
qualified conservation purposes, 
‘‘(2) the bond is issued by a State or local gov-
ernment, and 
‘‘(3) the issuer designates such bond for pur-
poses of this section. 
‘‘(b) REDUCED CREDIT AMOUNT.—The annual credit 
determined under section 54A(b) with respect to any 
qualified energy conservation bond shall be 70 percent of 
the amount so determined without regard to this sub-
section. 
‘‘(c) LIMITATION
ON AMOUNT
OF BONDS DES-
IGNATED.—The maximum aggregate face amount of 
bonds which may be designated under subsection (a) by 
any issuer shall not exceed the limitation amount allocated 
to such issuer under subsection (e). 
‘‘(d) NATIONAL LIMITATION ON AMOUNT OF BONDS 
DESIGNATED.—There is a national qualified energy con-
servation bond limitation of $2,625,000,000. 
‘‘(e) ALLOCATIONS.— 
‘‘(1) IN
GENERAL.—The limitation applicable 
under subsection (d) shall be allocated by the Sec-
retary among the States in proportion to the popu-
lation of the States. 
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266 
‘‘(2) ALLOCATIONS
TO
LARGEST
LOCAL
GOV-
ERNMENTS.— 
‘‘(A) IN
GENERAL.—In the case of any 
State in which there is a large local govern-
ment, each such local government shall be allo-
cated a portion of such State’s allocation which 
bears the same ratio to the State’s allocation 
(determined without regard to this subpara-
graph) as the population of such large local 
government bears to the population of such 
State. 
‘‘(B) ALLOCATION OF UNUSED LIMITATION 
TO STATE.—The amount allocated under this 
subsection to a large local government may be 
reallocated by such local government to the 
State in which such local government is located. 
‘‘(C) LARGE
LOCAL
GOVERNMENT.—For 
purposes of this section, the term ‘large local 
government’ means any municipality or county 
if such municipality or county has a population 
of 100,000 or more. 
‘‘(3) ALLOCATION
TO
ISSUERS; RESTRICTION 
ON
PRIVATE
ACTIVITY
BONDS.—Any allocation 
under this subsection to a State or large local gov-
ernment shall be allocated by such State or large 
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267 
local government to issuers within the State in a 
manner that results in not less than 70 percent of 
the allocation to such State or large local govern-
ment being used to designate bonds which are not 
private activity bonds. 
‘‘(f) QUALIFIED
CONSERVATION
PURPOSE.—For 
purposes of this section— 
‘‘(1) IN
GENERAL.—The term ‘qualified con-
servation purpose’ means any of the following: 
‘‘(A) Capital expenditures incurred for 
purposes of— 
‘‘(i) reducing energy consumption in 
publicly-owned buildings by at least 20 
percent, 
‘‘(ii) implementing green community 
programs, 
‘‘(iii) rural development involving the 
production of electricity from renewable 
energy resources, or 
‘‘(iv) any qualified facility (as deter-
mined under section 45(d) without regard 
to paragraphs (8) and (10) thereof and 
without regard to any placed in service 
date). 
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268 
‘‘(B) Expenditures with respect to research 
facilities, and research grants, to support re-
search in— 
‘‘(i) development of cellulosic ethanol 
or other nonfossil fuels, 
‘‘(ii) technologies for the capture and 
sequestration of carbon dioxide produced 
through the use of fossil fuels, 
‘‘(iii) increasing the efficiency of exist-
ing technologies for producing nonfossil 
fuels, 
‘‘(iv) automobile battery technologies 
and other technologies to reduce fossil fuel 
consumption in transportation, or 
‘‘(v) technologies to reduce energy use 
in buildings. 
‘‘(C) Mass commuting facilities and related 
facilities that reduce the consumption of energy, 
including expenditures to reduce pollution from 
vehicles used for mass commuting. 
‘‘(D) Demonstration projects designed to 
promote the commercialization of— 
‘‘(i) green building technology, 
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269 
‘‘(ii) conversion of agricultural waste 
for use in the production of fuel or other-
wise, 
‘‘(iii) advanced battery manufacturing 
technologies, 
‘‘(iv) technologies to reduce peak use 
of electricity, or 
‘‘(v) technologies for the capture and 
sequestration of carbon dioxide emitted 
from combusting fossil fuels in order to 
produce electricity. 
‘‘(E) Public education campaigns to pro-
mote energy efficiency. 
‘‘(2) SPECIAL
RULES
FOR
PRIVATE
ACTIVITY 
BONDS.—For purposes of this section, in the case of 
any private activity bond, the term ‘qualified con-
servation purposes’ shall not include any expenditure 
which is not a capital expenditure. 
‘‘(g) POPULATION.— 
‘‘(1) IN
GENERAL.—The population of any 
State or local government shall be determined for 
purposes of this section as provided in section 146(j) 
for the calendar year which includes the date of the 
enactment of this section. 
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270 
‘‘(2) SPECIAL RULE FOR COUNTIES.—In deter-
mining the population of any county for purposes of 
this section, any population of such county which is 
taken into account in determining the population of 
any municipality which is a large local government 
shall not be taken into account in determining the 
population of such county. 
‘‘(h) APPLICATION
TO INDIAN TRIBAL GOVERN-
MENTS.—An Indian tribal government shall be treated for 
purposes of this section in the same manner as a large 
local government, except that— 
‘‘(1) an Indian tribal government shall be treat-
ed for purposes of subsection (e) as located within 
a State to the extent of so much of the population 
of such government as resides within such State, 
and 
‘‘(2) any bond issued by an Indian tribal gov-
ernment shall be treated as a qualified energy con-
servation bond only if issued as part of an issue the 
available project proceeds of which are used for pur-
poses for which such Indian tribal government could 
issue bonds to which section 103(a) applies.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Paragraph (1) of section 54A(d), as amend-
ed by section 806, is amended by striking ‘‘or’’ at 
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271 
the end of subparagraph (A), by adding ‘‘or’’ at the 
end of subparagraph (B), and by inserting after sub-
paragraph (B) the following new subparagraph: 
‘‘(C) 
a 
qualified 
energy 
conservation 
bond,’’. 
(2) Subparagraph (C) of section 54A(d)(2), as 
amended by section 806, is amended by striking 
‘‘and’’ at the end of clause (i), by striking the period 
at the end of clause (ii) and inserting ‘‘and’’, and by 
adding at the end the following new clause: 
‘‘(iii) in the case of a qualified energy 
conservation bond, a purpose specified in 
section 54D(a)(1).’’. 
(3) The table of sections for subpart I of part 
IV of subchapter A of chapter 1, as amended by sec-
tion 806, is amended by adding at the end the fol-
lowing new item: 
‘‘Sec. 54D. Qualified energy conservation bonds.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to obligations issued after the date 
of the enactment of this Act. 
SEC. 842. CREDIT FOR NONBUSINESS ENERGY PROPERTY. 
(a) EXTENSION
OF CREDIT.—Section 25C(g) is 
amended by striking ‘‘December 31, 2007’’ and inserting 
‘‘December 31, 2008’’. 
(b) QUALIFIED BIOMASS FUEL PROPERTY.— 
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(1) IN GENERAL.—Section 25C(d)(3) is amend-
ed— 
(A) by striking ‘‘and’’ at the end of sub-
paragraph (D), 
(B) by striking the period at the end of 
subparagraph (E) and inserting ‘‘, and’’, and 
(C) by adding at the end the following new 
subparagraph: 
‘‘(F) a stove which uses the burning of bio-
mass fuel to heat a dwelling unit located in the 
United States and used as a residence by the 
taxpayer, or to heat water for use in such a 
dwelling unit, and which has a thermal effi-
ciency rating of at least 75 percent.’’. 
(2) BIOMASS FUEL.—Section 25C(d) is amend-
ed by adding at the end the following new para-
graph: 
‘‘(6) BIOMASS FUEL.—The term ‘biomass fuel’ 
means any plant-derived fuel available on a renew-
able or recurring basis, including agricultural crops 
and trees, wood and wood waste and residues (in-
cluding wood pellets), plants (including aquatic 
plants), grasses, residues, and fibers.’’. 
(c) COORDINATION WITH CREDIT FOR QUALIFIED 
GEOTHERMAL HEAT PUMP PROPERTY EXPENDITURES.— 
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(1) IN
GENERAL.—Paragraph (3) of section 
25C(d), as amended by subsection (b), is amended 
by striking subparagraph (C) and by redesignating 
subparagraphs (D), (E), and (F) as subparagraphs 
(C), (D), and (E), respectively. 
(2) CONFORMING AMENDMENT.—Subparagraph 
(C) of section 25C(d)(2) is amended to read as fol-
lows: 
‘‘(C) REQUIREMENTS
AND
STANDARDS 
FOR AIR CONDITIONERS AND HEAT PUMPS.— 
The standards and requirements prescribed by 
the Secretary under subparagraph (B) with re-
spect to the energy efficiency ratio (EER) for 
central air conditioners and electric heat 
pumps— 
‘‘(i) shall require measurements to be 
based on published data which is tested by 
manufacturers at 95 degrees Fahrenheit, 
and 
‘‘(ii) may be based on the certified 
data of the Air Conditioning and Refrig-
eration Institute that are prepared in part-
nership with the Consortium for Energy 
Efficiency.’’. 
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274 
(d) EFFECTIVE DATE.—The amendments made this 
section shall apply to expenditures made after December 
31, 2007. 
SEC. 843. ENERGY EFFICIENT COMMERCIAL BUILDINGS DE-
DUCTION. 
Subsection (h) of section 179D is amended by strik-
ing ‘‘December 31, 2008’’ and inserting ‘‘December 31, 
2013’’. 
SEC. 844. MODIFICATIONS OF ENERGY EFFICIENT APPLI-
ANCE CREDIT FOR APPLIANCES PRODUCED 
AFTER 2007. 
(a) IN GENERAL.—Subsection (b) of section 45M is 
amended to read as follows: 
‘‘(b) APPLICABLE AMOUNT.—For purposes of sub-
section (a)— 
‘‘(1) DISHWASHERS.—The applicable amount 
is— 
‘‘(A) $45 in the case of a dishwasher which 
is manufactured in calendar year 2008 or 2009 
and which uses no more than 324 kilowatt 
hours per year and 5.8 gallons per cycle, and 
‘‘(B) $75 in the case of a dishwasher 
which is manufactured in calendar year 2008, 
2009, or 2010 and which uses no more than 
307 kilowatt hours per year and 5.0 gallons per 
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cycle (5.5 gallons per cycle for dishwashers de-
signed for greater than 12 place settings). 
‘‘(2) 
CLOTHES
WASHERS.—The 
applicable 
amount is— 
‘‘(A) $75 in the case of a residential top- 
loading clothes washer manufactured in cal-
endar year 2008 which meets or exceeds a 1.72 
modified energy factor and does not exceed a 
8.0 water consumption factor, 
‘‘(B) $125 in the case of a residential top- 
loading clothes washer manufactured in cal-
endar year 2008 or 2009 which meets or ex-
ceeds a 1.8 modified energy factor and does not 
exceed a 7.5 water consumption factor, 
‘‘(C) $150 in the case of a residential or 
commercial clothes washer manufactured in cal-
endar year 2008, 2009, or 2010 which meets or 
exceeds 2.0 modified energy factor and does not 
exceed a 6.0 water consumption factor, and 
‘‘(D) $250 in the case of a residential or 
commercial clothes washer manufactured in cal-
endar year 2008, 2009, or 2010 which meets or 
exceeds 2.2 modified energy factor and does not 
exceed a 4.5 water consumption factor. 
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276 
‘‘(3) REFRIGERATORS.—The applicable amount 
is— 
‘‘(A) $50 in the case of a refrigerator 
which is manufactured in calendar year 2008, 
and consumes at least 20 percent but not more 
than 22.9 percent less kilowatt hours per year 
than the 2001 energy conservation standards, 
‘‘(B) $75 in the case of a refrigerator 
which is manufactured in calendar year 2008 or 
2009, and consumes at least 23 percent but no 
more than 24.9 percent less kilowatt hours per 
year than the 2001 energy conservation stand-
ards, 
‘‘(C) $100 in the case of a refrigerator 
which is manufactured in calendar year 2008, 
2009, or 2010, and consumes at least 25 per-
cent but not more than 29.9 percent less kilo-
watt hours per year than the 2001 energy con-
servation standards, and 
‘‘(D) $200 in the case of a refrigerator 
manufactured in calendar year 2008, 2009, or 
2010 and which consumes at least 30 percent 
less energy than the 2001 energy conservation 
standards.’’. 
(b) ELIGIBLE PRODUCTION.— 
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277 
(1) SIMILAR
TREATMENT
FOR
ALL
APPLI-
ANCES.—Subsection (c) of section 45M is amend-
ed— 
(A) by striking paragraph (2), 
(B) by striking ‘‘(1) IN GENERAL’’ and all 
that follows through ‘‘the eligible’’ and inserting 
‘‘The eligible’’, 
(C) by moving the text of such subsection 
in line with the subsection heading, and 
(D) by redesignating subparagraphs (A) 
and (B) as paragraphs (1) and (2), respectively, 
and by moving such paragraphs 2 ems to the 
left. 
(2) MODIFICATION
OF
BASE
PERIOD.—Para-
graph (2) of section 45M(c), as amended by para-
graph (1), is amended by striking ‘‘3-calendar year’’ 
and inserting ‘‘2-calendar year’’. 
(c) TYPES OF ENERGY EFFICIENT APPLIANCES.— 
Subsection (d) of section 45M (defining types of energy 
efficient appliances) is amended to read as follows: 
‘‘(d) TYPES OF ENERGY EFFICIENT APPLIANCE.— 
For purposes of this section, the types of energy efficient 
appliances are— 
‘‘(1) dishwashers described in subsection (b)(1), 
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‘‘(2) clothes washers described in subsection 
(b)(2), and 
‘‘(3) 
refrigerators 
described 
in 
subsection 
(b)(3).’’. 
(d) AGGREGATE CREDIT AMOUNT ALLOWED.— 
(1) INCREASE IN LIMIT.—Paragraph (1) of sec-
tion 45M(e) is amended to read as follows: 
‘‘(1) AGGREGATE CREDIT AMOUNT ALLOWED.— 
The aggregate amount of credit allowed under sub-
section (a) with respect to a taxpayer for any tax-
able year shall not exceed $75,000,000 reduced by 
the amount of the credit allowed under subsection 
(a) to the taxpayer (or any predecessor) for all prior 
taxable years beginning after December 31, 2007.’’. 
(2) EXCEPTION FOR CERTAIN REFRIGERATOR 
AND CLOTHES WASHERS.—Paragraph (2) of section 
45M(e) is amended to read as follows: 
‘‘(2) AMOUNT ALLOWED FOR CERTAIN REFRIG-
ERATORS
AND
CLOTHES
WASHERS.—Refrigerators 
described in subsection (b)(3)(D) and clothes wash-
ers described in subsection (b)(2)(D) shall not be 
taken into account under paragraph (1).’’. 
(e) QUALIFIED ENERGY EFFICIENT APPLIANCES.— 
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280 
access located on the top of the machine and which 
operates on a vertical axis.’’. 
(4) REPLACEMENT OF ENERGY FACTOR.—Sec-
tion 45M(f)(6), as redesignated by paragraph (3), is 
amended to read as follows: 
‘‘(6) MODIFIED
ENERGY
FACTOR.—The term 
‘modified energy factor’ means the modified energy 
factor established by the Department of Energy for 
compliance with the Federal energy conservation 
standard.’’. 
(5) GALLONS
PER
CYCLE; WATER
CONSUMP-
TION
FACTOR.—Section 45M(f), as amended by 
paragraph (3), is amended by adding at the end the 
following: 
‘‘(9) GALLONS PER CYCLE.—The term ‘gallons 
per cycle’ means, with respect to a dishwasher, the 
amount of water, expressed in gallons, required to 
complete a normal cycle of a dishwasher. 
‘‘(10) WATER
CONSUMPTION
FACTOR.—The 
term ‘water consumption factor’ means, with respect 
to a clothes washer, the quotient of the total weight-
ed per-cycle water consumption divided by the cubic 
foot (or liter) capacity of the clothes washer.’’. 
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281 
(f) EFFECTIVE DATE.—The amendments made by 
this section shall apply to appliances produced after De-
cember 31, 2007. 
SEC. 845. ACCELERATED RECOVERY PERIOD FOR DEPRE-
CIATION OF SMART METERS AND SMART 
GRID SYSTEMS. 
(a) IN GENERAL.—Section 168(e)(3)(D) is amended 
by striking ‘‘and’’ at the end of clause (i), by striking the 
period at the end of clause (ii) and inserting a comma, 
and by inserting after clause (ii) the following new clauses: 
‘‘(iii) any qualified smart electric 
meter, and 
‘‘(iv) any qualified smart electric grid 
system.’’. 
(b) DEFINITIONS.—Section 168(i) is amended by in-
serting at the end the following new paragraph: 
‘‘(18) QUALIFIED SMART ELECTRIC METERS.— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
smart electric meter’ means any smart electric 
meter which is placed in service by a taxpayer 
who is a supplier of electric energy or a pro-
vider of electric energy services. 
‘‘(B) SMART ELECTRIC METER.—For pur-
poses of subparagraph (A), the term ‘smart 
electric meter’ means any time-based meter and 
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282 
related communication equipment which is ca-
pable of being used by the taxpayer as part of 
a system that— 
‘‘(i) measures and records electricity 
usage data on a time-differentiated basis 
in at least 24 separate time segments per 
day, 
‘‘(ii) provides for the exchange of in-
formation between supplier or provider and 
the customer’s electric meter in support of 
time-based rates or other forms of demand 
response, 
‘‘(iii) provides data to such supplier or 
provider so that the supplier or provider 
can provide energy usage information to 
customers electronically, and 
‘‘(iv) provides net metering. 
‘‘(19) QUALIFIED SMART ELECTRIC GRID SYS-
TEMS.— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
smart electric grid system’ means any smart 
grid property used as part of a system for elec-
tric distribution grid communications, moni-
toring, and management placed in service by a 
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283 
taxpayer who is a supplier of electric energy or 
a provider of electric energy services. 
‘‘(B) SMART
GRID
PROPERTY.—For the 
purposes of subparagraph (A), the term ‘smart 
grid property’ means electronics and related 
equipment that is capable of— 
‘‘(i) sensing, collecting, and moni-
toring data of or from all portions of a 
utility’s electric distribution grid, 
‘‘(ii) providing real-time, two-way 
communications to monitor or manage 
such grid, and 
‘‘(iii) providing real time analysis of 
and event prediction based upon collected 
data that can be used to improve electric 
distribution system reliability, quality, and 
performance.’’. 
(c) CONTINUED APPLICATION OF 150 PERCENT DE-
CLINING BALANCE METHOD.—Paragraph (2) of section 
168(b) is amended by striking ‘‘or’’ at the end of subpara-
graph (B), by redesignating subparagraph (C) as subpara-
graph (D), and by inserting after subparagraph (B) the 
following new subparagraph: 
‘‘(C) any property (other than property de-
scribed in paragraph (3)) which is a qualified 
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284 
smart electric meter or qualified smart electric 
grid system, or’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act. 
SEC. 846. QUALIFIED GREEN BUILDING AND SUSTAINABLE 
DESIGN PROJECTS. 
(a) IN GENERAL.—Paragraph (8) of section 142(l) 
is amended by striking ‘‘September 30, 2009’’ and insert-
ing ‘‘September 30, 2012’’. 
(b) 
TREATMENT
OF
CURRENT
REFUNDING 
BONDS.—Paragraph (9) of section 142(l) is amended by 
striking ‘‘October 1, 2009’’ and inserting ‘‘October 1, 
2012’’. 
(c) ACCOUNTABILITY.—The second sentence of sec-
tion 701(d) of the American Jobs Creation Act of 2004 
is amended by striking ‘‘issuance,’’ and inserting 
‘‘issuance of the last issue with respect to such project,’’. 
Subtitle D—Revenue Provisions 
SEC. 851. LIMITATION OF DEDUCTION FOR INCOME AT-
TRIBUTABLE TO DOMESTIC PRODUCTION OF 
OIL, GAS, OR PRIMARY PRODUCTS THEREOF. 
(a) DENIAL
OF DEDUCTION
FOR SPECIFIED OIL 
COMPANIES FOR INCOME ATTRIBUTABLE TO DOMESTIC 
PRODUCTION
OF OIL, GAS, OR PRIMARY PRODUCTS 
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285 
THEREOF.—Subparagraph (B) of section 199(c)(4) (re-
lating to exceptions) is amended by striking ‘‘or’’ at the 
end of clause (ii), by striking the period at the end of 
clause (iii) and inserting ‘‘, or’’, and by inserting after 
clause (iii) the following new clause: 
‘‘(iv) in the case of any specified oil 
company (as defined in subsection (d)(9)), 
the production, refining, processing, trans-
portation, or distribution of oil, gas, or any 
primary product thereof.’’. 
(b) LIMITATION ON OIL RELATED QUALIFIED PRO-
DUCTION ACTIVITIES INCOME FOR TAXPAYERS OTHER 
THAN SPECIFIED OIL COMPANIES.— 
(1) IN GENERAL.—Section 199(d) is amended 
by redesignating paragraph (9) as paragraph (10) 
and by inserting after paragraph (8) the following 
new paragraph: 
‘‘(9) SPECIAL RULE FOR TAXPAYERS WITH OIL 
RELATED
QUALIFIED
PRODUCTION
ACTIVITIES
IN-
COME.— 
‘‘(A) IN GENERAL.—If a taxpayer (other 
than a specified oil company) has oil related 
qualified production activities income for any 
taxable year beginning after 2009, the amount 
otherwise allowable as a deduction under sub-
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‘‘(ii) any entity in which a foreign 
government holds (directly or indirectly)— 
‘‘(I) any interest which (by value 
or voting interest) is 50 percent or 
more of the total of such interests in 
such entity, or 
‘‘(II) any other interest which 
provides the foreign government with 
effective control of such entity. 
‘‘(D) PRIMARY
PRODUCT.—For purposes 
of this section, the term ‘primary product’ has 
the same meaning as when used in section 
927(a)(2)(C), as in effect before its repeal.’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
199(d)(2) (relating to application to individuals) is 
amended by striking ‘‘subsection (a)(1)(B)’’ and in-
serting ‘‘subsections (a)(1)(B) and (d)(9)(A)(iii)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
SEC. 852. CLARIFICATION OF DETERMINATION OF FOREIGN 
OIL AND GAS EXTRACTION INCOME. 
(a) IN GENERAL.—Paragraph (1) of section 907(c) 
is amended by redesignating subparagraph (B) as sub-
paragraph (C), by striking ‘‘or’’ at the end of subpara-
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graph (A), and by inserting after subparagraph (A) the 
following new subparagraph: 
‘‘(B) so much of any transportation of 
such minerals as occurs before the fair market 
value event, or’’. 
(b) FAIR MARKET VALUE EVENT.—Subsection (c) of 
section 907 is amended by adding at the end the following 
new paragraph: 
‘‘(6) FAIR MARKET VALUE EVENT.—For pur-
poses of this section, the term ‘fair market value 
event’ means, with respect to any mineral, the first 
point in time at which such mineral— 
‘‘(A) has a fair market value which can be 
determined on the basis of a transfer, which is 
an arm’s length transaction, of such mineral 
from the taxpayer to a person who is not re-
lated (within the meaning of section 482) to 
such taxpayer, or 
‘‘(B) is at a location at which the fair mar-
ket value is readily ascertainable by reason of 
transactions among unrelated third parties with 
respect to the same mineral (taking into ac-
count source, location, quality, and chemical 
composition).’’. 
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(c) SPECIAL
RULE
FOR
CERTAIN
PETROLEUM 
TAXES.—Subsection (c) of section 907, as amended by 
subsection (b), is amended to by adding at the end the 
following new paragraph: 
‘‘(7) OIL AND GAS TAXES.—In the case of any 
tax imposed by a foreign country which is limited in 
its application to taxpayers engaged in oil or gas ac-
tivities— 
‘‘(A) the term ‘oil and gas extraction taxes’ 
shall include such tax, 
‘‘(B) the term ‘foreign oil and gas extrac-
tion income’ shall include any taxable income 
which is taken into account in determining such 
tax (or is directly attributable to the activity to 
which such tax relates), and 
‘‘(C) the term ‘foreign oil related income’ 
shall not include any taxable income which is 
treated as foreign oil and gas extraction income 
under subparagraph (B).’’. 
(d) CONFORMING AMENDMENTS.— 
(1) Subparagraph (C) of section 907(c)(1), as 
redesignated by this section, is amended by inserting 
‘‘or used by the taxpayer in the activity described in 
subparagraph (B)’’ before the period at the end. 
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(2) Subparagraph (B) of section 907(c)(2) is 
amended to read as follows: 
‘‘(B) so much of the transportation of such 
minerals or primary products as is not taken 
into account under paragraph (1)(B),’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
SEC. 853. TIME FOR PAYMENT OF CORPORATE ESTIMATED 
TAXES. 
In the case of a corporation— 
(1) to which paragraph (1) of section 401 of 
the Tax Increase Prevention and Reconciliation Act 
of 2005 applies, and 
(2) which had any significant income for the 
preceding taxable year referred to in such paragraph 
from extraction, production, processing, refining, 
transportation, distribution, or retail sale, of any 
fuel or electricity, 
the percentage under subparagraph (C) of such paragraph 
(as in effect on the date of the enactment of this Act) 
is increased by 40 percentage points. 
Æ 
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