I 
111TH CONGRESS 
1ST SESSION H. R. 3918 
To amend the Internal Revenue Code of 1986 to provide a tax credit for 
qualified distributed thermal energy storage property, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
OCTOBER 22, 2009 
Mr. THOMPSON of California (for himself, Mr. HERGER, Mr. POMEROY, Mr. 
LARSON of Connecticut, Mr. MICHAUD, and Ms. PINGREE of Maine) in-
troduced 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 
a tax credit for qualified distributed thermal energy stor-
age property, 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. 
This Act may be cited as the ‘‘Thermal Energy Cool-
ing and Heating Act of 2009’’. 
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SEC. 2. CREDIT FOR QUALIFIED DISTRIBUTED THERMAL 
STORAGE PROPERTY INSTALLED IN A PRIN-
CIPAL RESIDENCE. 
(a) IN GENERAL.—Subsection (a) of section 25D of 
the Internal Revenue Code of 1986 is amended by striking 
‘‘and’’ at the end of paragraph (4), by striking the period 
at the end of paragraph (5) and inserting ‘‘, and’’, and 
by adding at the end the following new paragraph: 
‘‘(6) 30 percent of the qualified distributed 
thermal energy storage property expenditures made 
by the taxpayer during such year.’’. 
(b) QUALIFIED DISTRIBUTED THERMAL ENERGY 
STORAGE PROPERTY EXPENDITURE.—Section 25D(d) of 
such Code is amended by adding at the end the following 
new paragraph: 
‘‘(6) QUALIFIED
DISTRIBUTED
THERMAL
EN-
ERGY
STORAGE
PROPERTY
EXPENDITURE.—The 
term ‘qualified distributed thermal energy storage 
property expenditure’ means an expenditure for 
qualified distributed thermal energy storage property 
(as defined in section 48(e)) installed on or in con-
nection with a dwelling unit located in the United 
States and used as a principal residence (within the 
meaning of section 121) by the taxpayer.’’. 
(c) MODIFICATION OF MAXIMUM CREDIT.— 
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(1) IN
GENERAL.—Paragraph (1) of section 
25D(b) of such Code is amended by striking ‘‘and’’ 
at the end of subparagraph (B), by striking the pe-
riod at the end of subparagraph (C), and by adding 
at the end the following new subparagraphs: 
‘‘(D) $500 with respect to each half kilo-
watt of peak demand reduction (as defined in 
section 48(e)(3)) by cooling systems which are 
qualified distributed thermal energy storage 
property (as defined in section 48(e)) for which 
qualified distributed thermal energy storage 
property expenditures are made, and 
‘‘(E) $150 for each nameplate kilowatt 
input of thermal heat storage by heating sys-
tems which are qualified distributed thermal en-
ergy storage property (as defined in section 
48(e)) for which qualified distributed thermal 
energy 
storage 
property 
expenditures 
are 
made.’’. 
(2) CONFORMING
AMENDMENTS.—Paragraph 
(4) of section 25D(e) of such Code is amended— 
(A) by amending so much of such para-
graph as precedes subparagraph (B) to read as 
follows: 
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‘‘(4) LIMITATIONS
IN
CASE
OF
JOINT
OCCU-
PANCY.—In the case of any dwelling unit which is 
jointly occupied and used during any calendar year 
as a residence by two or more individuals the fol-
lowing rules shall apply: 
‘‘(A) 
MAXIMUM
EXPENDITURES.—The 
maximum amount of expenditures which may 
be taken into account under subsection (a) by 
all such individuals with respect to such dwell-
ing unit during such calendar year shall be— 
‘‘(i) $1,667 in the case of each half 
kilowatt of capacity of qualified fuel cell 
property (as defined in section 48(c)(1)) 
for which qualified fuel cell property ex-
penditures are made, 
‘‘(ii) $1,667 in case of each half kilo-
watt of peak demand reduction (as defined 
in section 48(e)(3)) by cooling systems 
which are qualified distributed thermal en-
ergy storage property (as defined in section 
48(e)) for which qualified distributed ther-
mal energy storage property expenditures 
are made, and 
‘‘(iii) $333 in the case of each name-
plate kilowatt input of thermal heat stor-
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age by heating systems which are qualified 
distributed thermal energy storage prop-
erty (as defined in section 48(e)) for which 
qualified distributed thermal energy stor-
age property expenditures are made.’’, and 
(B) by adding at the end of subparagraph 
(B) the following: 
‘‘This subparagraph shall be applied separately 
with respect to qualified fuel cell property ex-
penditures, qualified distributed thermal energy 
storage property expenditures with respect cool-
ing systems, and qualified distributed thermal 
energy storage property with respect to heating 
systems.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
SEC. 3. BUSINESS CREDIT FOR QUALIFIED DISTRIBUTED 
THERMAL ENERGY STORAGE PROPERTY. 
(a) IN GENERAL.—Subparagraph (A) of section 
48(a)(3) of the Internal Revenue Code of 1986 is amended 
by deleting ‘‘or’’ at the end of clause (vi), by inserting 
‘‘or’’ at the end of clause (vii), and by inserting clause 
(vii) the following new clause: 
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‘‘(viii) qualified distributed thermal 
energy storage property but only with re-
spect to periods ending before January 1, 
2017,’’. 
(b) 30 PERCENT CREDIT.—Clause (i) of section 
48(a)(2)(A) of such Code is amended by striking ‘‘and’’ 
at the end of subclause (III) and by inserting after sub-
clause (IV) the following new subclause: 
‘‘(V) qualified distributed ther-
mal energy storage property, and’’. 
(c) QUALIFIED DISTRIBUTED THERMAL ENERGY 
STORAGE PROPERTY.—Section 48 of such Code is amend-
ed by adding at the end the following new subsection: 
‘‘(e) QUALIFIED DISTRIBUTED THERMAL ENERGY 
STORAGE PROPERTY.—For the purposes of this section: 
‘‘(1) IN GENERAL.—The term ‘qualified distrib-
uted thermal energy storage property’ means a heat-
ing or cooling system which— 
‘‘(A) consists of mechanical thermal heat 
storage or cooling storage components which 
are designed to create, store, and supply off 
peak or renewable electric distributed thermal 
energy or to reduce or avoid peak electrical de-
mand of conventional mechanical cooling or 
heating equipment, 
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‘‘(B) has a nameplate operational capa-
bility to deliver a minimum of 29,000 Btu per 
hour of cooling capacity or a minimum of in-
stalled nameplate thermal heat storage capacity 
of 85,000 Btu, 
‘‘(C) is designed to deliver such cooling ca-
pacity for a minimum continuous period of 3 
hours, available daily from May 1 through Sep-
tember 30, or a minimum of 15,000 Btu per 
hour of heating capacity for a minimum contin-
uous period of 3 hours, available daily from Oc-
tober 1 through April 30, coincident with day-
time peak load periods, 
‘‘(D) is designed so as to utilize off-peak or 
renewable electricity or reduce peak kilowatt de-
mand by 90 percent for the heating and cooling 
load served, and 
‘‘(E) is certified by the manufacturer as 
designed so as not to exceed the energy con-
sumption of conventional HVAC equipment by 
more than 10 percent. 
‘‘(2) INCLUSION
OF
RELATED
EQUIPMENT.— 
Such term shall include any secondary components 
which integrate the distributed thermal energy stor-
age system described in paragraph (1) with the con-
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ventional heating or cooling system, including equip-
ment and controls for measuring and reporting oper-
ation and performance, but shall not include any 
portion of the conventional heating or cooling sys-
tem. 
‘‘(3) LIMITATION.— 
‘‘(A) IN GENERAL.—In case of qualified 
distributed thermal energy storage property 
placed in service during the taxable year, the 
credit otherwise determined under this section 
for such year with respect to such property 
shall not exceed an amount equal to $500 for 
each 0.5 kilowatt of peak demand reduction for 
property placed in service for cooling or $150 
for each nameplate kilowatt input for property 
placed in service for heating. 
‘‘(B) PEAK
DEMAND
REDUCTION.—For 
purposes of this subsection, the term ‘peak de-
mand reduction’ means the removal or avoid-
ance of electrical demand (kW) on the utility 
grid system during the daily time period of high 
electrical demand. The peak demand reduction 
for air conditioning property shall be deter-
mined based on Energy Efficiency Ratio (EER) 
standards for residential and commercial air 
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conditioning equipment, established under the 
Energy Policy and Conservation Act of 1975.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this Act shall apply to taxable years beginning after the 
date of the enactment of this Act. 
SEC. 4. QUALIFIED DISTRIBUTED THERMAL ENERGY STOR-
AGE PROPERTY MADE ELIGIBLE FOR NEW 
CLEAN RENEWABLE ENERGY BONDS. 
(a) IN GENERAL.—Paragraph (1) of section 54C(d) 
of the Internal Revenue Code of 1986 is amended to read 
as follows: 
‘‘(1) QUALIFIED RENEWABLE ENERGY FACIL-
ITY.—The term ‘qualified renewable energy facility’ 
means— 
‘‘(A) any qualified facility (as determined 
under section 45(d) without regard to para-
graphs (8) and (10) thereof and to any placed 
in service date), and 
‘‘(B) any qualified distributed thermal en-
ergy storage property (as defined in section 
48(e)), 
owned by a public power provider, a governmental 
body, or a cooperative electric company.’’. 
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