I 
110TH CONGRESS 
2D SESSION 
H. R. 6756 
To amend the Internal Revenue Code of 1986 to provide tax incentives 
for clean coal technology, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 31, 2008 
Mr. POMEROY (for himself and Mr. LEWIS of Kentucky) introduced the 
following bill; which was referred to the Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
tax incentives for clean coal technology, and for other 
purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; FINDINGS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Carbon Reduction Technology Bridge Act of 2008’’. 
(b) FINDINGS.—The Congress finds the following: 
(1) Significantly reducing greenhouse gas emis-
sions from U.S. coal plants must be part of a strat-
egy to address climate change. 
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(2) Carbon capture and sequestration is the key 
to continued enjoyment of the energy security and 
economic benefits associated with the use of the Na-
tion’s abundant domestic coal resources for power 
generation. 
(3) Multiple technology demonstrations that in-
crease the efficiency of power plants and thereby re-
duce carbon dioxide emissions and that demonstrate 
carbon dioxide capture and sequestration are needed 
in the near-term as a bridge to a reliable and afford-
able power system that can achieve future green-
house gas reduction goals. 
SEC. 2. SEVEN-YEAR AMORTIZATION FOR CERTAIN SYS-
TEMS INSTALLED ON COAL-FIRED ELECTRIC 
GENERATION UNITS AFTER 2007. 
(a) IN GENERAL.—Subsection (d) of section 169 of 
the Internal Revenue Code of 1986 (relating to amortiza-
tion of pollution control facilities) is amended by adding 
at the end the following new paragraph: 
‘‘(6) SPECIAL RULE FOR SYSTEMS INSTALLED 
ON
COAL-FIRED
ELECTRIC
GENERATION
UNITS 
AFTER 2007.— 
‘‘(A) IN
GENERAL.—Any mechanical or 
electronic system— 
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‘‘(i) which is installed on a coal-fired 
electric generation unit after December 31, 
2007, and 
‘‘(ii) which reduces carbon dioxide 
emissions per net megawatt hour of elec-
tricity generation by 1 or more of the 
means described in subparagraph (B) or 
any other means, 
shall be treated for purposes of this section as 
an identifiable treatment facility which abates 
or controls atmospheric pollution or contamina-
tion by removing, altering, disposing, storing, or 
preventing the creation or emission of pollut-
ants, contaminants, wastes, or heat. Paragraph 
(1)(C) of this subsection, and subsection (e), 
shall not apply to any system which is so treat-
ed. 
‘‘(B) MEANS FOR REDUCING EMISSIONS.— 
The means described in this subparagraph 
are— 
‘‘(i) optimizing combustion, 
‘‘(ii) optimizing sootblowing and heat 
transfer, 
‘‘(iii) upgrading steam temperature 
control capabilities, 
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‘‘(iv) reducing exit gas temperatures 
(air heater modifications), 
‘‘(v) predrying low rank coals using 
power plant waste heat, 
‘‘(vi) modifying steam turbines or 
change the steam path/blading, 
‘‘(vii) replacing single speed motors 
with variable speed drives for fans and 
pumps, and 
‘‘(viii) improving operational controls, 
including neural networks. 
‘‘(C) SPECIAL RULE FOR MINIMUM TAX.— 
Section 56(a)(5) shall not apply to property to 
which this paragraph applies.’’ 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to property placed in service after 
December 31, 2007. 
SEC. 3. CREDIT FOR CLOSED–LOOP BIOMASS CO-FIRED 
WITH COAL. 
(a) IN GENERAL.—Subparagraph (A) of section 
45(d)(2) of the Internal Revenue Code of 1986 (relating 
to closed-loop biomass facility) is amended by striking the 
period at the end of clause (ii) and inserting ‘‘, or’’ and 
by adding after clause (ii) the following new clause: 
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‘‘(iii) owned by the taxpayer which be-
fore January 1, 2014, is originally placed 
in service as— 
‘‘(I) a facility to use closed-loop 
biomass to co-fire (or, in the case of 
an integrated gasification combined 
cycle facility, co-process) with coal, or 
‘‘(II) a coal-fired facility which is 
modified to use closed-loop biomass to 
co-fire (or, in the case of an inte-
grated gasification combined cycle fa-
cility, co-process) with coal.’’ 
(b) CONFORMING AMENDMENT.—Subparagraph (B) 
of section 45(d)(2) of such Code is amended by striking 
‘‘subparagraph (A)(ii)’’ and inserting ‘‘clause (ii) or (iii) 
of subparagraph (A)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the date of the enactment 
of this Act. 
SEC. 4. CREDIT FOR INVESTMENT IN QUALIFIED NEW 
CLEAN COAL ELECTRIC GENERATION UNITS. 
(a) IN GENERAL.—Subpart E of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to rules for computing investment credit) 
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is amended by inserting after section 48B the following 
new section: 
‘‘SEC. 48C. QUALIFYING NEW CLEAN COAL ELECTRIC GEN-
ERATION UNIT CREDIT. 
‘‘(a) GENERAL RULE.—For purposes of section 46, 
the qualifying new clean coal electric generation credit for 
any taxable year is an amount equal to the applicable per-
centage of the qualified investment for such taxable year. 
‘‘(b) APPLICABLE PERCENTAGE.—For purposes of 
subsection (a)— 
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), the applicable percentage is the percent-
age determined under the following table using the 
design net heat rate of the qualified clean coal elec-
tric generation unit. 
‘‘Design Net Heat Rate in Btus/kilowatt hour 
Percentage 
More than 8322 but not more than 8530 (40%) .....
More than 8120 but not more than 8322 (41%) .....
More than 7940 but not more than 8120 (42%) .....
More than 7760 but not more than 7940 (43%) .....
More than 7580 but not more than 7760 (44%) .....
Not more than 7580 (45%) ......................................
‘‘(2) ELECTION TO USE ALTERNATIVE METHOD 
FOR DETERMINING PERCENTAGE.—In the case of a 
qualified clean coal electric generation unit which is 
designed to emit carbon dioxide at an average an-
nual rate of not more than 800 pounds per net 
megawatt hour of electricity generation, in lieu of 
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applying paragraph (1), the taxpayer may elect an 
applicable percentage of 30 percent. 
‘‘(c) QUALIFIED INVESTMENT.— 
‘‘(1) IN GENERAL.—For purposes of subsection 
(a), the qualified investment for any taxable year is 
the basis of property placed in service by the tax-
payer during such taxable year as part of, or in con-
nection with, a qualified clean coal electric genera-
tion unit— 
‘‘(A)(i) the construction, reconstruction, or 
erection of which is completed by the taxpayer, 
or 
‘‘(ii) which is acquired by the taxpayer if 
the original use of such property commences 
with the taxpayer, and 
‘‘(B) with respect to which depreciation (or 
amortization in lieu of depreciation) is allow-
able. 
‘‘(2) SPECIAL RULE FOR CERTAIN SUBSIDIZED 
PROPERTY.—Rules similar to section 48(a)(4) shall 
apply for purposes of this section. 
‘‘(3) CERTAIN QUALIFIED PROGRESS EXPENDI-
TURES RULES MADE APPLICABLE.—Rules similar to 
the rules of subsections (c)(4) and (d) of section 46 
(as in effect on the day before the enactment of the 
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Revenue Reconciliation Act of 1990) shall apply for 
purposes of this section. 
‘‘(d) AGGREGATE CREDITS.— 
‘‘(1) IN GENERAL.—No credit shall be allowed 
under this section with respect to any qualified clean 
coal electric generation unit unless such unit is cer-
tified by the Secretary under subsection (f). 
‘‘(2) LIMITATION ON UNITS CERTIFIED.—The 
Secretary may certify under subsection (f) in the ag-
gregate no more than 6,000 megawatts of electric 
generation units. 
‘‘(e) DEFINITIONS.—For purposes of this section— 
‘‘(1) QUALIFIED CLEAN COAL ELECTRIC GEN-
ERATION UNIT.—The term ‘qualified clean coal elec-
tric generation unit’ means a coal-based electric gen-
eration unit if— 
‘‘(A) the unit achieves a design net heat 
rate of not more than 8530 Btu/Kw-hr, 
‘‘(B) the unit is designed to meet the per-
formance requirements specified in the table 
contained in section 48A(f)(1)(B), 
‘‘(C) the unit includes— 
‘‘(i) carbon dioxide capture, transport, 
and storage property (as defined in section 
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48D(c)) for carbon dioxide produced by 
such unit, and 
‘‘(ii) 1 or more sites for the storage of 
such carbon dioxide, 
‘‘(D) the unit is designed to capture, and 
store, at least— 
‘‘(i) 500,000 metric tons per year of 
carbon dioxide if such unit is among the 
first 1,000 megawatts of electric genera-
tion units certified by the Secretary under 
subsection (f), and 
‘‘(ii) 1,000,000 metric tons per year 
of carbon dioxide if such unit is among the 
next 3,000 megawatts of electric genera-
tion units certified by the Secretary under 
subsection (f), and 
‘‘(iii) 2,000,000 metric tons per year 
of carbon dioxide for any other unit, 
‘‘(E) the fuel input for the unit, when com-
pleted, is at least 75 percent coal, and 
‘‘(F) the unit is located in the United 
States. 
‘‘(2) DESIGN
NET
HEAT
RATE.—Design net 
heat rate shall be determined as provided in section 
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48A(f)(2) and before any energy loss resulting from 
the operation of the carbon dioxide capture process. 
‘‘(3) COAL.—The term ‘coal’ means bituminous 
coal, subbituminous coal, and lignite. 
‘‘(4) ELECTRIC GENERATION UNIT.—The term 
‘electric generation unit’ means any unit at least 50 
percent of the total annual net output of which is 
electrical power, including an otherwise eligible unit 
which is used in an industrial application. 
‘‘(f) CERTIFICATION.— 
‘‘(1) CERTIFICATION PROCESS.—The Secretary, 
in consultation with the Secretary of Energy and the 
Administrator of the Environmental Protection 
Agency, shall establish a certification process to de-
termine if a coal-based electric generation unit meets 
all criteria and other requirements to be recognized 
as a qualified clean coal electric generation unit. The 
certification process shall also be designed to deter-
mine the efficiency (and, in the case of an election 
under subsection (b)(2), the carbon dioxide emission 
rate) of such unit to establish the amount of the 
credit under subsection (a). 
‘‘(2) PRIORITY
FOR
UNITS
EXCEEDING
CAP-
TURE
AND
STORAGE
REQUIREMENTS.—In deter-
mining which qualified clean coal generation units to 
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certify under subsection (f), the Secretary shall give 
high priority to those units which exceed the carbon 
dioxide and storage requirements provided in sub-
section (e)(1)(D). 
‘‘(3) FEEDSTOCK
REQUIREMENTS.—After the 
date of publication by the Secretary of the final cer-
tification process referred to in subsection (d), the 
Secretary shall allocate the limitation in subsection 
(d)(2) in equal amounts among— 
‘‘(A) units using bituminous coal as a pri-
mary feedstock, 
‘‘(B) units using subbituminous coal as a 
primary feedstock, and 
‘‘(C) units using lignite as a primary feed-
stock. 
‘‘(4) REDISTRIBUTION.—The Secretary may re-
allocate credits if the Secretary determines that 
there is an insufficient quantity of qualifying appli-
cations for certification, pending at the time of re-
view, to comply with the feedstock requirements of 
paragraph (3). The Secretary may conduct an addi-
tional program for applications for certification and 
reallocate available credits without regard to the 
feedstock requirement which was not satisfied as a 
result of insufficient applications for certification. 
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‘‘(5) REQUIREMENTS FOR APPLICATIONS FOR 
CERTIFICATION.—An application for certification 
shall contain such information as the Secretary may 
require in order to make a determination to accept 
or reject the application and establish applicable 
credit entitlement. Any information contained in the 
application shall be protected as provided in section 
552(b)(4) of title 5, United States Code. 
‘‘(g) DENIAL OF DOUBLE BENEFIT.—No credit shall 
be allowed under this section for any property for which 
credit is allowed under sections 48A, 48B, or 48D.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 46 of such Code (relating to amount 
of credit) 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 add-
ing at the end the following new paragraph: 
‘‘(5) the qualifying new clean coal electric gen-
eration credit.’’. 
(2) Subparagraph (C) of section 49(a)(1) of 
such Code is amended by striking ‘‘and’’ at the end 
of clause (iii), by striking the period at the end of 
clause (iv) and inserting ‘‘, and’’, and by adding 
after clause (iv) the following new clause: 
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‘‘(v) the basis of any property which 
is part of a qualifying clean coal electric 
generation unit under section 48C.’’. 
(3) The table of sections for subpart E of part 
IV of subchapter A of chapter 1 of such Code is 
amended by inserting after the item relating to sec-
tion 48B the following new item: 
‘‘Sec. 48C. Qualifying new clean coal electric generation unit credit.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to periods after the date of the 
enactment of this Act 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). 
SEC. 5. TAX CREDIT FOR INSTALLATION OF CARBON DIOX-
IDE CAPTURE, TRANSPORT, AND STORAGE 
EQUIPMENT. 
(a) IN GENERAL.—Subpart E of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to rules for computing investment credit) 
is amended by inserting after section 48C the following 
new section: 
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‘‘SEC. 
48D. 
QUALIFYING 
CARBON 
DIOXIDE 
CAPTURE, 
TRANSPORT, 
AND 
STORAGE 
EQUIPMENT 
CREDIT. 
‘‘(a) GENERAL RULE.—For purposes of section 46, 
the qualifying carbon dioxide equipment credit for any tax-
able year is an amount equal to 30 percent of the qualified 
investment for such taxable year. 
‘‘(b) QUALIFIED INVESTMENT.— 
‘‘(1) IN GENERAL.—For purposes of subsection 
(a), the qualified investment for any taxable year is 
the basis eligible property which is placed in service 
by the taxpayer during such taxable year. 
‘‘(2) SPECIAL RULE FOR CERTAIN SUBSIDIZED 
PROPERTY.—Rules similar to section 48(a)(4) shall 
apply for purposes of this section. 
‘‘(3) CERTAIN QUALIFIED PROGRESS EXPENDI-
TURES RULES MADE APPLICABLE.—Rules similar to 
the rules of subsections (c)(4) and (d) of section 46 
(as in effect on the day before the enactment of the 
Revenue Reconciliation Act of 1990) shall apply for 
purposes of this section. 
‘‘(c) DEFINITIONS.—For purposes of this section— 
‘‘(1) ELIGIBLE PROPERTY.—The term ‘eligible 
property’ means carbon dioxide capture, transport, 
and storage property— 
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‘‘(A) which is part of (or used in connec-
tion with) a qualified coal-fired electric genera-
tion unit of the taxpayer, 
‘‘(B)(i) the construction, reconstruction, or 
erection of which is completed by the taxpayer, 
or 
‘‘(ii) which is acquired by the taxpayer if 
the original use of such property commences 
with the taxpayer, and 
‘‘(C) with respect to which depreciation (or 
amortization in lieu of depreciation) is allow-
able. 
‘‘(2) CARBON DIOXIDE CAPTURE, TRANSPORT, 
AND STORAGE PROPERTY.—The term ‘carbon diox-
ide capture, transport, and storage property’ means 
equipment to capture, transport, or store carbon di-
oxide produced at such unit, including— 
‘‘(A) equipment to separate and pressurize 
carbon dioxide for transport (including equip-
ment to operate such equipment), and 
‘‘(B) equipment to transport, inject, and 
monitor such carbon dioxide. 
‘‘(3) QUALIFIED
COAL-FIRED
ELECTRIC
GEN-
ERATION UNIT.—The term ‘qualified coal-fired elec-
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tric generation unit’ means any coal-fired electric 
generation unit— 
‘‘(A) which, after installation of eligible 
property, is designed— 
‘‘(i) to emit carbon dioxide at an aver-
age annual rate of less than 1100 pounds 
of carbon dioxide per net megawatt hour of 
electricity generation, or 
‘‘(ii) to capture and store in a secure 
geologic formation at least 500,000 metric 
tons of carbon dioxide per year, 
‘‘(B) the fuel input for which is at least 75 
percent coal, and 
‘‘(C) which is located in the United States. 
‘‘(4) COAL.—The term ‘coal’ means bituminous 
coal, subbituminous coal, and lignite. 
‘‘(d) AGGREGATE CREDITS.— 
‘‘(1) IN GENERAL.—No credit shall be allowed 
under this section for property which is part of (or 
used in connection with) a qualified coal-fired elec-
tric generation unit unless such unit is certified by 
the Secretary under subsection (e). 
‘‘(2) LIMITATION ON UNITS CERTIFIED.—The 
Secretary may certify under subsection (e) in the ag-
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gregate no more than 9,000 megawatts of electric 
generation units. 
‘‘(e) CERTIFICATION.— 
‘‘(1) CERTIFICATION PROCESS.—The Secretary 
shall establish a certification process for purposes of 
this section. 
‘‘(2) FEEDSTOCK REQUIREMENTS.—During the 
first 24 months after the date of publication by the 
Secretary of the final certification process referred 
to in paragraph (1), the Secretary shall allocate the 
limitation in subsection (d)(2) in equal amounts 
among— 
‘‘(A) units using bituminous coal as a pri-
mary feedstock, 
‘‘(B) units using subbituminous coal as a 
primary feedstock, and 
‘‘(C) units using lignite as a primary feed-
stock. 
‘‘(3) REDISTRIBUTION.—The Secretary may re-
allocate credits if the Secretary determines that 
there is an insufficient quantity of qualifying appli-
cations for certification, pending at the time of re-
view, to comply with the feedstock requirements of 
paragraph (2). The Secretary may conduct an addi-
tional program for applications for certification and 
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reallocate available credits without regard to the 
feedstock requirement which was not satisfied as a 
result of insufficient applications for certification. 
‘‘(4) REQUIREMENTS FOR APPLICATIONS FOR 
CERTIFICATION.—An application for certification 
shall contain such information as the Secretary may 
require in order to establish credit entitlement. Any 
information contained in an application shall be pro-
tected as provided in section 552(b)(4) of title 5, 
United States Code.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 46 of such Code (relating to amount 
of credit), as amended by this Act, is amended by 
striking ‘‘and’’ at the end of paragraph (4), by strik-
ing the period at the end of paragraph (5) and in-
serting ‘‘, and’’, and by adding at the end the fol-
lowing new paragraph: 
‘‘(6) the qualifying carbon dioxide equipment 
credit.’’. 
(2) Subparagraph (C) of section 49(a)(1) of 
such Code, as amended by this Act, is amended by 
striking ‘‘and’’ at the end of clause (iv), by striking 
the period at the end of clause (v) and inserting ‘‘, 
and’’, and by adding after clause (v) the following 
new clause: 
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‘‘(vi) the basis of any eligible property 
(as defined in section 48D(c)(1)).’’. 
(3) The table of sections for such subpart E is 
amended by inserting after the item relating to sec-
tion 48C the following new item: 
‘‘Sec. 48D. Qualifying carbon dioxide capture, transport, and storage equip-
ment credit.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to periods after the date of the 
enactment of this Act 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). 
SEC. 6. TAX CREDIT FOR CARBON DIOXIDE SEQUESTRA-
TION. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to business related credits) is amended by 
adding at the end the following new section: 
‘‘SEC. 45Q. CREDIT FOR CARBON DIOXIDE SEQUESTRATION. 
‘‘(a) GENERAL RULE.—For purposes of section 38, 
the carbon dioxide sequestration credit for any taxable 
year is an amount equal to the sum of— 
‘‘(1) $30 per metric ton of qualified carbon di-
oxide which is stored by the taxpayer in secure geo-
logical storage, 
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‘‘(2) $20 per metric ton of qualified carbon di-
oxide which is compressed, and transferred, by the 
taxpayer to the United States at a facility under 
such rules and conditions as the Federal Govern-
ment shall prescribe not later than 18 months prior 
to any transfer, and 
‘‘(3) $15 per metric ton of qualified carbon di-
oxide which is used by the taxpayer as a tertiary 
injectant in a qualified enhanced oil or natural gas 
recovery project. 
‘‘(b) QUALIFIED CARBON DIOXIDE.—For purposes of 
this section, the term ‘qualified carbon dioxide’ means car-
bon dioxide— 
‘‘(1) which is captured from a qualified electric 
generation unit during the 10-year period beginning 
on the date that carbon dioxide capture equipment 
was originally placed in service at such unit, 
‘‘(2) which would otherwise be released into the 
atmosphere, and 
‘‘(3) which is measured at the source of capture 
and verified at the point of disposal or injection. 
‘‘(c) QUALIFIED ELECTRIC GENERATION UNIT.— 
For purposes of this section, the term ‘qualified electric 
generation unit’ means any electric generation unit (as de-
fined in section 48A(c)(6))— 
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‘‘(1) which is owned by the taxpayer, 
‘‘(2) at which the fuel input is at least 75 per-
cent coal, 
‘‘(3) at which carbon dioxide capture equipment 
is placed in service, 
‘‘(4) which— 
‘‘(A) captures not less than 500,000 metric 
tons of carbon dioxide during the taxable year, 
or 
‘‘(B) is designed to emit carbon dioxide at 
an average annual rate of less than 1100 
pounds of carbon dioxide per net megawatt 
hour of electricity generated during the taxable 
year, and 
‘‘(5) which is located in— 
‘‘(A) the United States (within the mean-
ing of section 638(1)), or 
‘‘(B) a possession of the United States 
(within the meaning of section 638(2)). 
‘‘(d) AGGREGATE CREDITS.— 
‘‘(1) IN GENERAL.—No credit shall be allowed 
under this section for carbon dioxide captured from 
a qualified facility unless such facility is certified by 
the Secretary for purposes of this section. The owner 
of a qualified facility may request to be certified for 
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purposes of this section by submitted a request to 
the Secretary containing such information as the 
Secretary may require. 
‘‘(2) LIMITATION ON UNITS CERTIFIED.—The 
Secretary may certify in the aggregate no more than 
9,000 megawatts of electric generation units. 
‘‘(e) CERTIFICATION.— 
‘‘(1) CERTIFICATION PROCESS.—The Secretary 
shall establish a certification process for purposes of 
this section. 
‘‘(2) FEEDSTOCK REQUIREMENTS.—During the 
first 24 months after the date of publication by the 
Secretary of the final certification process referred 
to in paragraph (1), the Secretary shall allocate the 
limitation in subsection (d)(2) in equal amounts 
among— 
‘‘(A) units using bituminous coal as a pri-
mary feedstock, 
‘‘(B) units using subbituminous coal as a 
primary feedstock, and 
‘‘(C) units using lignite as a primary feed-
stock. 
‘‘(3) REDISTRIBUTION.—The Secretary may re-
allocate credits if the Secretary determines that 
there is an insufficient quantity of qualifying appli-
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cations for certification, pending at the time of re-
view, to comply with the feedstock requirements of 
paragraph (2). The Secretary may conduct an addi-
tional program for applications for certification and 
reallocate available credits without regard to the 
feedstock requirement which was not satisfied as a 
result of insufficient applications for certification. 
‘‘(4) REQUIREMENTS FOR APPLICATIONS FOR 
CERTIFICATION.—An application for certification 
shall contain such information as the Secretary may 
require in order to make a determination to accept 
or reject the application and establish applicable 
credit entitlement. Any information contained in the 
application shall be protected as provided in section 
552(b)(4) of title 5, United States Code. 
‘‘(f) SPECIAL RULES AND OTHER DEFINITIONS.— 
For purposes of this section— 
‘‘(1) SECURE GEOLOGICAL STORAGE.—The Sec-
retary, in consultation with the Administrator of the 
Environmental Protection Agency, shall establish 
regulations for determining adequate security meas-
ures for the geological storage of carbon dioxide 
under subsection (a)(1)(B). Such regulation shall in-
clude storage within deep saline formations and 
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umninable coal seams under such conditions as the 
Secretary may determine under such regulations. 
‘‘(2) RULES RELATING TO USE AS TERTIARY 
INJECTANT.— 
‘‘(A) TERTIARY
INJECTANT.—The term 
‘tertiary injectant’ has the same meaning as 
when used within section 193(b)(1). 
‘‘(B) QUALIFIED ENHANCED OIL OR NAT-
URAL
GAS
RECOVERY
PROJECT.—The term 
‘qualified enhanced oil or natural gas recovery 
project’ has the meaning given the term ‘quali-
fied enhanced oil recovery project’ by section 
43(c)(2), determined by substituting ‘crude oil 
or natural gas’ for ‘crude oil’ in subparagraph 
(A)(i) thereof. 
‘‘(C) RECYCLED
CARBON
DIOXIDE.—No 
credit shall be allowed under this section for 
carbon dioxide that is recaptured, recycled, and 
reinjected as part of the enhanced oil and nat-
ural gas recovery process. 
‘‘(3) CREDIT ATTRIBUTABLE TO TAXPAYER.— 
Any credit under this section shall be attributable to 
the person that captures and physically or contrac-
tually ensures the disposal of or the use as a tertiary 
injectant of the qualified carbon dioxide, except to 
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the extent provided in regulations prescribed by the 
Secretary. 
‘‘(4) RECAPTURE.—The Secretary shall, by reg-
ulations, provide for recapturing the benefit of any 
credit allowable under subsection (a) with respect to 
any qualified carbon dioxide which ceases to be cap-
tured, disposed of, or used as a tertiary injectant in 
a manner consistent with the requirements of this 
section. 
‘‘(5) INFLATION ADJUSTMENT.—In the case of 
any taxable year beginning in a calendar year after 
2008, there shall be substituted for each dollar 
amount contained in subsection (a) an amount equal 
to the product of— 
‘‘(A) such dollar amount, multiplied by 
‘‘(B) the inflation adjustment factor for 
such calendar year determined under section 
43(b)(3)(B) for such calendar year, determined 
by substituting ‘2008’ for ‘1990’. 
‘‘(6) COAL.—The term ‘coal’ means bituminous 
coal, subbituminous coal, and lignite.’’. 
(b) CONFORMING AMENDMENT.—Section 38(b) of 
such Code is amended by striking ‘‘plus’’ at the end of 
paragraph (32), by striking the period at the end of para-
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graph (33) and inserting ‘‘, plus’’, and by adding at the 
end of following new paragraph: 
‘‘(34) the carbon dioxide sequestration credit 
determined under section 45Q(a).’’. 
(c) CLERICAL AMENDMENT.—The table of sections 
for subpart D of part IV of subchapter A of chapter 1 
of such Code is amended by adding at the end the fol-
lowing new item: 
‘‘Sec. 45Q. Credit for carbon dioxide sequestration.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply carbon dioxide captured after the 
date of the enactment of this Act. 
SEC. 7. CLEAN ENERGY COAL BONDS. 
(a) IN GENERAL.—Subpart I of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to qualified tax credit bonds) is amended 
by adding at the end the following new section: 
‘‘SEC. 54C. CLEAN ENERGY COAL BONDS. 
‘‘(a) CLEAN ENERGY COAL BOND.—For purposes of 
this subchapter— 
‘‘(1) IN
GENERAL.—The term ‘clean energy 
coal bond’ means any bond issued as part of an 
issue if— 
‘‘(A) the bond is issued by a qualified 
issuer pursuant to an allocation by the Sec-
retary to such issuer of a portion of the na-
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tional clean energy coal bond limitation under 
subsection (b)(2); 
‘‘(B) 100 percent of the available project 
proceeds from the sale of such issue are to be 
used for capital expenditures incurred by quali-
fied borrowers for 1 or more qualified projects; 
‘‘(C) the qualified issuer designates such 
bond for purposes of this section and the bond 
is in registered form; and 
‘‘(D) in lieu of the requirements of section 
54A(d)(2), the issue meets the requirements of 
subsection (c). 
‘‘(2) 
QUALIFIED
PROJECT; 
SPECIAL
USE 
RULES.— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
project’ means a qualified clean coal project (as 
defined in subsection (f)(1)) placed in service by 
a qualified borrower. 
‘‘(B) REFINANCING RULES.—For purposes 
of paragraph (1)(B), a qualified project may be 
refinanced with proceeds of a clean energy coal 
bond only if the indebtedness being refinanced 
(including any obligation directly or indirectly 
refinanced by such indebtedness) was originally 
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incurred by a qualified borrower after the date 
of the enactment of this section. 
‘‘(C) REIMBURSEMENT.—For purposes of 
paragraph (1)(B), a clean energy coal bond 
may be issued to reimburse a qualified borrower 
for amounts paid after the date of the enact-
ment of this section with respect to a qualified 
project, but only if— 
‘‘(i) prior to the payment of the origi-
nal expenditure, the qualified borrower de-
clared its intent to reimburse such expendi-
ture with the proceeds of a clean energy 
coal bond; 
‘‘(ii) not later than 60 days after pay-
ment of the original expenditure, the quali-
fied issuer adopts an official intent to re-
imburse the original expenditure with such 
proceeds; and 
‘‘(iii) reimbursement is not made later 
than 18 months after the date the original 
expenditure is paid or the date the project 
is placed in service or abandoned, but in 
no event more than 3 years after the origi-
nal expenditure is paid. 
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‘‘(D) TREATMENT OF CHANGES IN USE.— 
For purposes of paragraph (1)(B), the proceeds 
of an issue shall not be treated as used for a 
qualified project to the extent that a qualified 
borrower takes any action within its control 
which causes such proceeds not to be used for 
a qualified project. The Secretary shall pre-
scribe regulations specifying remedial actions 
that may be taken (including conditions to tak-
ing such remedial actions) to prevent an action 
described in the preceding sentence from caus-
ing a bond to fail to be a clean energy coal 
bond. 
‘‘(b) LIMITATION
ON AMOUNT
OF BONDS DES-
IGNATED.— 
‘‘(1) NATIONAL LIMITATION.—There is a na-
tional 
clean 
energy 
coal 
bond 
limitation 
of 
$5,000,000,000. 
‘‘(2) ALLOCATION
BY
SECRETARY.—The Sec-
retary shall allocate the amount described in para-
graph (1) among qualified projects in such manner 
as the Secretary determines appropriate. 
‘‘(c) SPECIAL
RULES
RELATING
TO
EXPENDI-
TURES.— 
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‘‘(2) EXTENSION
OF
PERIOD.—Upon submis-
sion of a request prior to the expiration of the period 
described in paragraph (1)(A), the Secretary may 
extend such period if the qualified issuer establishes 
that the failure to satisfy the 5-year requirement is 
due to reasonable cause and the related projects will 
continue to proceed with due diligence. 
‘‘(3) FAILURE TO SPEND REQUIRED AMOUNT 
OF BOND PROCEEDS WITHIN 5 YEARS.—To the ex-
tent that less than 100 percent of the available 
project proceeds of such issue are expended by the 
close of the 5-year period beginning on the date of 
issuance (or if an extension has been obtained under 
paragraph (2), by the close of the extended period), 
the qualified issuer shall redeem all of the non-
qualified bonds within 90 days after the end of such 
period. For purposes of this paragraph, the amount 
of the nonqualified bonds required to be redeemed 
shall be determined in the same manner as under 
section 142. 
‘‘(d) COOPERATIVE ELECTRIC COMPANY; QUALIFIED 
ENERGY TAX CREDIT BOND LENDER; GOVERNMENTAL 
BODY; QUALIFIED BORROWER.—For purposes of this sec-
tion— 
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‘‘(1) 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), or a not-for- 
profit electric utility which has received a loan or 
loan guarantee under the Rural Electrification Act. 
‘‘(2) CLEAN
ENERGY
BOND
LENDER.—The 
term ‘clean energy bond lender’ means a lender 
which is a cooperative which is owned by, or has out-
standing loans to, 100 or more cooperative electric 
companies and is in existence on February 1, 2002, 
and shall include any affiliated entity which is con-
trolled by such lender. 
‘‘(3) PUBLIC POWER ENTITY.—The term ‘public 
power entity’ means a State utility with a service ob-
ligation, as such terms are defined in section 217 of 
the Federal Power Act (as in effect on the date of 
enactment of this paragraph). 
‘‘(4) QUALIFIED ISSUER.—The term ‘qualified 
issuer’ means— 
‘‘(A) a clean energy bond lender; 
‘‘(B) a cooperative electric company; or 
‘‘(C) a public power entity. 
‘‘(5) QUALIFIED BORROWER.—The term ‘quali-
fied borrower’ means— 
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‘‘(A) a mutual or cooperative electric com-
pany 
described 
in 
section 
501(c)(12) 
or 
1381(a)(2)(C); or 
‘‘(B) a public power entity. 
‘‘(e) SPECIAL RULES RELATING TO POOL BONDS.— 
No portion of a pooled financing bond may be allocable 
to any loan unless the borrower has entered into a written 
loan commitment for such portion prior to the issue date 
of such issue. 
‘‘(f) OTHER DEFINITIONS AND SPECIAL RULES.— 
For purposes of this section— 
‘‘(1) QUALIFIED CLEAN COAL PROJECT.—For 
purposes of this section, the term ‘qualified clean 
coal project’ means— 
‘‘(A) an atmospheric pollution control facil-
ity (within the meaning of section 169(d)(6)); 
‘‘(B) a closed-loop biomass facility (within 
the meaning of section 45(d)(2)); 
‘‘(C) a qualified new clean coal electric 
generation unit (within the meaning of section 
48C(d)(1)); 
‘‘(D) qualifying carbon dioxide equipment 
described in section 48D(c)(1); or 
‘‘(E) a qualified facility (within the mean-
ing of section 45Q(c)). 
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‘‘(2) POOLED
FINANCING
BOND.—The term 
‘pooled financing bond’ shall have the meaning given 
such term by section 149(f)(4)(A). 
‘‘(g) TERMINATION.—This section shall not apply 
with respect to any bond issued after December 31, 
2018.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Paragraph (1) of section 54A(d) of the In-
ternal Revenue Code of 1986 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 clean energy coal 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) of 
such Code 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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‘‘(ii) in the case of a clean energy coal 
bond, a purpose specified in section 
54C(f)(1).’’. 
(c) CLERICAL AMENDMENT.—The table of sections 
for subpart I of part IV of subchapter A of chapter 1 of 
the Internal Revenue Code of 1986 is amended by adding 
at the end the following new item: 
‘‘Sec. 54C. Clean energy coal bonds.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to bonds issued after December 
31, 2008. 
SEC. 8. CERTAIN INCOME AND GAINS RELATING TO INDUS-
TRIAL SOURCE CARBON DIOXIDE TREATED 
AS 
QUALIFYING 
INCOME 
FOR 
PUBLICLY 
TRADED PARTNERSHIPS. 
(a) IN GENERAL.—Subparagraph (E) of section 
7704(d)(1) of the Internal Revenue Code of 1986 (defin-
ing qualifying income) is amended— 
(1) by striking ‘‘or the marketing’’ and insert-
ing ‘‘the marketing’’, and 
(2) by inserting ‘‘or industrial source carbon di-
oxide’’ after ‘‘timber)’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the date of the enactment 
of this Act, in taxable years ending after such date. 
Æ 
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