IB 
Union Calendar No. 90 
111TH CONGRESS 
1ST SESSION H. R. 2454 
[Report No. 111–137, Part I] 
To create clean energy jobs, achieve energy independence, reduce global 
warming pollution and transition to a clean energy economy. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 15, 2009 
Mr. WAXMAN (for himself and Mr. MARKEY of Massachusetts) introduced the 
following bill; which was referred to the Committee on Energy and Com-
merce, and in addition to the Committees on Foreign Affairs, Financial 
Services, Education and Labor, Science and Technology, Transportation 
and Infrastructure, Natural Resources, Agriculture, and Ways and 
Means, for a period to be subsequently determined by the Speaker, in 
each case for consideration of such provisions as fall within the jurisdic-
tion of the committee concerned 
JUNE 5, 2009 
Reported from the Committee on Energy and Commerce with an amendment 
[Strike out all after the enacting clause and insert the part printed in italic] 
JUNE 5, 2009 
The Committees on Education and Labor and Foreign Affairs discharged 
JUNE 5, 2009 
Referral to the Committees on Financial Services, Science and Technology, 
Transportation and Infrastructure, Natural Resources, Agriculture, and 
Ways and Means extended for a period ending not later than June 19, 
2009 
JUNE 19, 2009 
The Committees on Financial Services, Science and Technology, Transpor-
tation and Infrastructure, Natural Resources, Agriculture, and Ways and 
Means discharged; committed to the Committee of the Whole House on 
the State of the Union and ordered to the printed 
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[For text of introduced bill, see copy of bill as introduced on May 15, 2009] 
A BILL 
To create clean energy jobs, achieve energy independence, 
reduce global warming pollution and transition to a clean 
energy economy. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘American Clean Energy and Security Act of 2009’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title; table of contents. 
Sec. 2. Definitions. 
Sec. 3. International participation. 
TITLE I—CLEAN ENERGY 
Subtitle A—Combined Efficiency and Renewable Electricity Standard 
Sec. 101. Combined efficiency and renewable electricity standard. 
Sec. 102. Clarifying State authority to adopt renewable energy incentives. 
Subtitle B—Carbon Capture and Sequestration 
Sec. 111. National strategy. 
Sec. 112. Regulations for geologic sequestration sites. 
‘‘Sec. 813. Geologic sequestration sites. 
Sec. 113. Studies and reports. 
Sec. 114. Carbon capture and sequestration demonstration and early deployment 
program. 
Sec. 115. Commercial deployment of carbon capture and sequestration tech-
nologies. 
‘‘Sec. 786. Commercial deployment of carbon capture and sequestration tech-
nologies. 
Sec. 116. Performance standards for coal-fueled power plants. 
‘‘Sec. 812. Performance standards for new coal-fired power plants. 
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Subtitle C—Clean Transportation 
Sec. 121. Electric vehicle infrastructure. 
Sec. 122. Large-scale vehicle electrification program. 
Sec. 123. Plug-in electric drive vehicle manufacturing. 
Sec. 124. Investment in clean vehicles. 
Sec. 125. Advanced technology vehicle manufacturing incentive loans. 
Sec. 126. Amendment to renewable fuels standard. 
Sec. 127. Open fuel standard. 
Sec. 128. Temporary Vehicle Trade-in Program. 
Sec. 129. Diesel emissions reduction. 
Sec. 130. Loan guarantees for projects to construct renewable fuel pipelines. 
Subtitle D—State Energy and Environment Development Accounts 
Sec. 131. Establishment of SEED Accounts. 
Sec. 132. Support of State renewable energy and energy efficiency programs. 
Subtitle E—Smart Grid Advancement 
Sec. 141. Definitions. 
Sec. 142.
Assessment of Smart Grid cost effectiveness in products. 
Sec. 143. Inclusions of Smart Grid capability on appliance ENERGY GUIDE 
labels. 
Sec. 144. Smart Grid peak demand reduction goals. 
Sec. 145.
Reauthorization of energy efficiency public information program to in-
clude Smart Grid information. 
Sec. 146. Inclusion of Smart Grid features in appliance rebate program. 
Subtitle F—Transmission Planning 
Sec. 151. Transmission planning. 
Sec. 152. Net metering for Federal agencies. 
Sec. 153. Support for qualified advanced electric transmission manufacturing 
plants, qualified high efficiency transmission property, and 
qualified advanced electric transmission property. 
Subtitle G—Technical Corrections to Energy Laws 
Sec. 161. Technical corrections to Energy Independence and Security Act of 2007. 
Sec. 162. Technical corrections to Energy Policy Act of 2005. 
Subtitle H—Energy and Efficiency Centers 
Sec. 171. Clean Energy Innovation Centers. 
Sec. 172. Building Assessment Centers. 
Sec. 173. Centers for Energy and Environmental Knowledge and Outreach. 
Subtitle I—Nuclear and Advanced Technologies 
Sec. 181. Revisions to loan guarantee program authority. 
Sec. 182. Purpose. 
Sec. 183. Definitions. 
Sec. 184. Clean Energy Investment Fund. 
Sec. 185. Energy technology deployment goals. 
Sec. 186. Clean Energy Deployment Administration. 
Sec. 187. Direct support. 
Sec. 188. Federal credit authority. 
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Sec. 189. General provisions. 
Subtitle J—Miscellaneous 
Sec. 191. Study of ocean renewable energy and transmission planning and siting. 
Sec. 192. Clean technology business competition grant program. 
Sec. 193. National Bioenergy Partnership. 
Sec. 194. Office of Consumer Advocacy. 
TITLE II—ENERGY EFFICIENCY 
Subtitle A—Building Energy Efficiency Programs 
Sec. 201. Greater energy efficiency in building codes. 
Sec. 202. Building retrofit program. 
Sec. 203. Energy efficient manufactured homes. 
Sec. 204. Building energy performance labeling program. 
Sec. 205. Tree planting programs. 
Sec. 206. Energy efficiency for data center buildings. 
Subtitle B—Lighting and Appliance Energy Efficiency Programs 
Sec. 211. Lighting efficiency standards. 
Sec. 212. Other appliance efficiency standards. 
Sec. 213. Appliance efficiency determinations and procedures. 
Sec. 214. Best-in-Class Appliances Deployment Program. 
Sec. 215. WaterSense. 
Sec. 216. Federal procurement of water efficient products. 
Sec. 217. Water efficient product rebate programs. 
Sec. 218. Certified stoves program. 
Sec. 219. Energy Star standards. 
Subtitle C—Transportation Efficiency 
Sec. 221. Emissions standards. 
‘‘PART B—MOBILE SOURCES 
‘‘Sec. 821. Greenhouse gas emission standards for mobile sources. 
Sec. 222. Greenhouse gas emissions reductions through transportation efficiency. 
‘‘PART D—PLANNING REQUIREMENTS 
‘‘Sec. 841. Greenhouse gas emissions reductions through transportation effi-
ciency. 
Sec. 223. SmartWay transportation efficiency program. 
‘‘Sec. 822. SmartWay transportation efficiency program. 
Sec. 224. State vehicle fleets. 
Subtitle D—Industrial Energy Efficiency Programs 
Sec. 241. Industrial plant energy efficiency standards. 
Sec. 242. Electric and thermal waste energy recovery award program. 
Sec. 243. Clarifying election of waste heat recovery financial incentives. 
Sec. 244. Motor market assessment and commercial awareness program. 
Sec. 245. Motor efficiency rebate program. 
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Subtitle E—Improvements in Energy Savings Performance Contracting 
Sec. 251. Energy savings performance contracts. 
Subtitle F—Public Institutions 
Sec. 261. Public institutions. 
Sec. 262. Community energy efficiency flexibility. 
Sec. 263. Small community joint participation. 
Sec. 264. Low income community energy efficiency program. 
Subtitle G—Miscellaneous 
Sec. 271. Energy efficient information and communications technologies. 
Sec. 272. National energy efficiency goals. 
Sec. 273. Affiliated island energy independence team. 
Sec. 274. Product carbon disclosure program. 
TITLE III—REDUCING GLOBAL WARMING POLLUTION 
Sec. 301. Short title. 
Subtitle A—Reducing Global Warming Pollution 
Sec. 311. Reducing global warming pollution. 
‘‘TITLE VII—GLOBAL WARMING POLLUTION REDUCTION PROGRAM 
‘‘PART A—GLOBAL WARMING POLLUTION REDUCTION GOALS AND TARGETS 
‘‘Sec. 701. Findings and purpose. 
‘‘Sec. 702. Economy-wide reduction goals. 
‘‘Sec. 703. Reduction targets for specified sources. 
‘‘Sec. 704. Supplemental pollution reductions. 
‘‘Sec. 705. Review and program recommendations. 
‘‘Sec. 706. National Academy review. 
‘‘Sec. 707. Presidential response and recommendations. 
‘‘PART B—DESIGNATION AND REGISTRATION OF GREENHOUSE GASES 
‘‘Sec. 711. Designation of greenhouse gases. 
‘‘Sec. 712. Carbon dioxide equivalent value of greenhouse gases. 
‘‘Sec. 713. Greenhouse gas registry. 
‘‘PART C—PROGRAM RULES 
‘‘Sec. 721. Emission allowances. 
‘‘Sec. 722. Prohibition of excess emissions. 
‘‘Sec. 723. Penalty for noncompliance. 
‘‘Sec. 724. Trading. 
‘‘Sec. 725. Banking and borrowing. 
‘‘Sec. 726. Strategic reserve. 
‘‘Sec. 727. Permits. 
‘‘Sec. 728. International emission allowances. 
‘‘PART D—OFFSETS 
‘‘Sec. 731. Offsets Integrity Advisory Board. 
‘‘Sec. 732. Establishment of offsets program. 
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‘‘Sec. 733. Eligible project types. 
‘‘Sec. 734. Requirements for offset projects. 
‘‘Sec. 735. Approval of offset projects. 
‘‘Sec. 736. Verification of offset projects. 
‘‘Sec. 737. Issuance of offset credits. 
‘‘Sec. 738. Audits. 
‘‘Sec. 739. Program review and revision. 
‘‘Sec. 740. Early offset supply. 
‘‘Sec. 741. Environmental considerations. 
‘‘Sec. 742. Trading. 
‘‘Sec. 743. International offset credits. 
‘‘PART E—SUPPLEMENTAL EMISSIONS REDUCTIONS FROM REDUCED 
DEFORESTATION 
‘‘Sec. 751. Definitions. 
‘‘Sec. 752. Findings. 
‘‘Sec. 753. Supplemental emissions reductions through reduced deforestation. 
‘‘Sec. 754. Requirements for international deforestation reduction program. 
‘‘Sec. 755. Reports and reviews. 
‘‘Sec. 756. Legal effect of part. 
Sec. 312. Definitions. 
‘‘Sec. 700. Definitions. 
Subtitle B—Disposition of Allowances 
Sec. 321. Disposition of allowances for global warming pollution reduction pro-
gram. 
‘‘PART H—DISPOSITION OF ALLOWANCES 
‘‘Sec. 781. Allocation of allowances for supplemental reductions. 
‘‘Sec. 782. Allocation of emission allowances. 
‘‘Sec. 783. Electricity consumers. 
‘‘Sec. 784. Natural gas consumers. 
‘‘Sec. 785. Home heating oil and propane consumers. 
‘‘Sec. 787. Allocations to refineries. 
‘‘Sec. 788. ƒSECTION RESERVED≈. 
‘‘Sec. 789. Climate change consumer refunds. 
‘‘Sec. 790. Exchange for State-issued allowances. 
‘‘Sec. 791. Auction procedures. 
‘‘Sec. 792. Auctioning allowances for other entities. 
‘‘Sec. 793. Establishment of funds. 
‘‘Sec. 794. Oversight of allocations. 
Subtitle C—Additional Greenhouse Gas Standards 
Sec. 331. Greenhouse gas standards. 
‘‘TITLE VIII—ADDITIONAL GREENHOUSE GAS STANDARDS 
‘‘Sec. 801. Definitions. 
‘‘PART A—STATIONARY SOURCE STANDARDS 
‘‘Sec. 811. Standards of performance. 
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‘‘PART C—EXEMPTIONS FROM OTHER PROGRAMS 
‘‘Sec. 831. Criteria pollutants. 
‘‘Sec. 832. International air pollution. 
‘‘Sec. 833. Hazardous air pollutants. 
‘‘Sec. 834. New source review. 
‘‘Sec. 835. Title V permits. 
Sec. 332. HFC Regulation. 
Sec. 333. Black carbon. 
‘‘PART E—BLACK CARBON 
‘‘Sec. 851. Black carbon. 
Sec. 334. States. 
Sec. 335. State programs. 
‘‘PART F—MISCELLANEOUS 
‘‘Sec. 861. State programs. 
‘‘Sec. 862. Grants for support of air pollution control programs. 
Sec. 336. Enforcement. 
Sec. 337. Conforming amendments. 
Sec. 338. Davis-Bacon compliance. 
Subtitle D—Carbon Market Assurance 
Sec. 341. Carbon market assurance. 
Subtitle E—Additional Market Assurance 
Sec. 351. Regulation of certain transactions in derivatives involving energy com-
modities. 
Sec. 352. No effect on authority of the Federal Energy Regulatory Commission. 
Sec. 353. Inspector General of the Commodity Futures Trading Commission. 
Sec. 354. Settlement and clearing through registered derivatives clearing organi-
zations. 
Sec. 355. Limitation on eligibility to purchase a credit default swap. 
Sec. 356. Transaction fees. 
Sec. 357. No effect on authority of the Federal Trade Commission. 
Sec. 358. Regulation of carbon derivatives markets. 
Sec. 359. Cease-and-desist authority. 
TITLE IV—TRANSITIONING TO A CLEAN ENERGY ECONOMY 
Subtitle A—Ensuring Real Reductions in Industrial Emissions 
Sec. 401. Ensuring real reductions in industrial emissions. 
‘‘PART F—ENSURING REAL REDUCTIONS IN INDUSTRIAL EMISSIONS 
‘‘Sec. 761. Purposes. 
‘‘Sec. 762. International negotiations. 
‘‘Sec. 763. Definitions. 
‘‘SUBPART 1—EMISSION ALLOWANCE REBATE PROGRAM 
‘‘Sec. 764. Eligible industrial sectors. 
‘‘Sec. 765. Distribution of emission allowance rebates. 
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‘‘SUBPART 2—INTERNATIONAL RESERVE ALLOWANCE PROGRAM 
‘‘Sec. 766. International reserve allowance program. 
‘‘SUBPART 3—PRESIDENTIAL DETERMINATION 
‘‘Sec. 767. Presidential reports and determinations. 
Subtitle B—Green Jobs and Worker Transition 
PART 1—GREEN JOBS 
Sec. 421. Clean energy curriculum development grants. 
Sec. 422. Increased funding for energy worker training program. 
PART 2—CLIMATE CHANGE WORKER ADJUSTMENT ASSISTANCE 
Sec. 425. Petitions, eligibility requirements, and determinations. 
Sec. 426. Program benefits. 
Sec. 427. General provisions. 
Subtitle C—Consumer Assistance 
Sec. 431. Energy tax credit. 
Sec. 432. Energy refund program for low-income consumers. 
Subtitle D—Exporting Clean Technology 
Sec. 441. Findings and purposes. 
Sec. 442. Definitions. 
Sec. 443. Governance. 
Sec. 444. Determination of eligible countries. 
Sec. 445. Qualifying activities. 
Sec. 446. Assistance. 
Subtitle E—Adapting to Climate Change 
PART 1—DOMESTIC ADAPTATION 
SUBPART A—NATIONAL CLIMATE CHANGE ADAPTATION PROGRAM 
Sec. 451. National Climate Change Adaptation Program. 
Sec. 452. Climate services. 
Sec. 453. State programs to build resilience to climate change impacts. 
SUBPART B—PUBLIC HEALTH AND CLIMATE CHANGE 
Sec. 461. Sense of Congress on public health and climate change. 
Sec. 462. Relationship to other laws. 
Sec. 463. National strategic action plan. 
Sec. 464. Advisory board. 
Sec. 465. Reports. 
Sec. 466. Definitions. 
Sec. 467. Climate Change Health Protection and Promotion Fund. 
SUBPART C—NATURAL RESOURCE ADAPTATION 
Sec. 471. Purposes. 
Sec. 472. Natural resources climate change adaptation policy. 
Sec. 473. Definitions. 
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Sec. 474. Council on Environmental Quality. 
Sec. 475. Natural Resources Climate Change Adaptation Panel. 
Sec. 476. Natural Resources Climate Change Adaptation Strategy. 
Sec. 477. Natural resources adaptation science and information. 
Sec. 478. Federal natural resource agency adaptation plans. 
Sec. 479. State natural resources adaptation plans. 
Sec. 480. Natural Resources Climate Change Adaptation Fund. 
Sec. 481. National Wildlife Habitat and Corridors Information Program. 
Sec. 482. Additional provisions regarding Indian tribes. 
PART 2—INTERNATIONAL CLIMATE CHANGE ADAPTATION PROGRAM 
Sec. 491. Findings and purposes. 
Sec. 492. Definitions. 
Sec. 493. International Climate Change Adaptation Program. 
Sec. 494. Distribution of allowances. 
Sec. 495. Bilateral assistance. 
SEC. 2. DEFINITIONS. 
For purposes of this Act: 
(1) 
ADMINISTRATOR.—The 
term 
‘‘Adminis-
trator’’ means the Administrator of the Environ-
mental Protection Agency. 
(2) STATE.—The term ‘‘State’’ has the meaning 
given that term in section 302 of the Clean Air Act. 
SEC. 3. INTERNATIONAL PARTICIPATION. 
The Administrator, in consultation with the Depart-
ment of State and the United States Trade Representative, 
shall annually prepare and certify a report to the Congress 
regarding whether China and India have adopted green-
house gas emissions standards at least as strict as those 
standards required under this Act. If the Administrator de-
termines that China and India have not adopted greenhouse 
gas emissions standards at least as stringent as those set 
forth in this Act, the Administrator shall notify each Mem-
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ber of Congress of his determination, and shall release his 
determination to the media. 
TITLE I—CLEAN ENERGY 
Subtitle 
A—Combined 
Efficiency 
and 
Renewable 
Electricity 
Standard 
SEC. 101. COMBINED EFFICIENCY AND RENEWABLE ELEC-
TRICITY STANDARD. 
(a) IN GENERAL.—Title VI of the Public Utility Regu-
latory Policies Act of 1978 (16 U.S.C. 2601 and following) 
is amended by adding at the end the following: 
‘‘SEC. 610. COMBINED EFFICIENCY AND RENEWABLE ELEC-
TRICITY STANDARD. 
‘‘(a) DEFINITIONS.—For purposes of this section: 
‘‘(1) CHP SAVINGS.—The term ‘CHP savings’ 
means— 
‘‘(A) CHP system savings from a combined 
heat and power system that commences operation 
after the date of enactment of this section; and 
‘‘(B) the increase in CHP system savings 
from, at any time after the date of the enactment 
of this section, upgrading, replacing, expanding, 
or increasing the utilization of a combined heat 
and power system that commenced operation on 
or before the date of enactment of this section. 
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‘‘(2) CHP SYSTEM SAVINGS.—The term ‘CHP 
system savings’ means the electric output, and the 
electricity saved due to the mechanical output, of a 
combined heat and power system, adjusted to reflect 
any increase in fuel consumption by that system as 
compared to the fuel that would have been required to 
produce an equivalent useful thermal energy output 
in a separate thermal-only system. 
‘‘(3) COMBINED HEAT AND POWER SYSTEM.—The 
term ‘combined heat and power system’ means a sys-
tem that uses the same energy source both for the gen-
eration of electrical or mechanical power and the pro-
duction of steam or another form of useful thermal 
energy, provided that— 
‘‘(A) the system meets such requirements re-
lating to efficiency and other operating charac-
teristics as the Commission may promulgate by 
regulation; and 
‘‘(B) the net sales of electricity by the facil-
ity to customers not consuming the thermal out-
put from that facility will not exceed 50 percent 
of total annual electric generation by the facility. 
‘‘(4) CUSTOMER FACILITY SAVINGS.—The term 
‘customer facility savings’ means a reduction in end- 
use electricity consumption (including recycled energy 
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savings) at a facility of an end-use consumer of elec-
tricity served by a retail electric supplier, as com-
pared to— 
‘‘(A) in the case of a new facility, consump-
tion at a reference facility of average efficiency; 
‘‘(B) in the case of an existing facility, con-
sumption at such facility during a base period, 
except as provided in subparagraphs (C) and 
(D); 
‘‘(C) in the case of new equipment that re-
places existing equipment with remaining useful 
life, the projected consumption of the existing 
equipment for the remaining useful life of such 
equipment, and thereafter, consumption of new 
equipment of average efficiency of the same 
equipment type; and 
‘‘(D) in the case of new equipment that re-
places existing equipment at the end of the useful 
life of the existing equipment, consumption by 
new equipment of average efficiency of the same 
equipment type. 
‘‘(5) DISTRIBUTED RENEWABLE GENERATION FA-
CILITY.—The term ‘distributed renewable generation 
facility’ means a facility that— 
‘‘(A) generates renewable electricity; 
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‘‘(B) primarily serves 1 or more electricity 
consumers at or near the facility site; and 
‘‘(C) is no greater than— 
‘‘(i) 2 megawatts in capacity; or 
‘‘(ii) 4 megawatts in capacity, in the 
case of a facility that is placed in service 
after the date of enactment of this section 
and generates electricity from a renewable 
energy resource other than by means of com-
bustion. 
‘‘(6) ELECTRICITY
SAVINGS.—The term ‘elec-
tricity savings’ means reductions in electricity con-
sumption, relative to business-as-usual projections, 
achieved through measures implemented after the date 
of enactment of this section, limited to— 
‘‘(A) customer facility savings of electricity, 
adjusted to reflect any associated increase in fuel 
consumption at the facility; 
‘‘(B) reductions in distribution system 
losses of electricity achieved by a retail electricity 
distributor, as compared to losses attributable to 
new or replacement distribution system equip-
ment of average efficiency; 
‘‘(C) CHP savings; and 
‘‘(D) fuel cell savings. 
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‘‘(7) FEDERAL LAND.—The term ‘Federal land’ 
means land owned by the United States, other than 
land held in trust for an Indian or Indian tribe. 
‘‘(8) FEDERAL RENEWABLE ELECTRICITY CRED-
IT.—The term ‘Federal renewable electricity credit’ 
means a credit, representing one megawatt hour of re-
newable electricity, issued pursuant to subsection (e). 
‘‘(9) FUEL CELL.—The term ‘fuel cell’ means a 
device that directly converts the chemical energy of a 
fuel and an oxidant into electricity by electrochemical 
processes occurring at separate electrodes in the de-
vice. 
‘‘(10) FUEL CELL SAVINGS.—The term ‘fuel cell 
savings’ means the electricity saved by a fuel cell that 
is installed after the date of enactment of this section, 
or by upgrading a fuel cell that commenced operation 
on or before the date of enactment of this section, as 
a result of the greater efficiency with which the fuel 
cell transforms fuel into electricity as compared with 
sources of electricity delivered through the grid, pro-
vided that— 
‘‘(A) the fuel cell meets such requirements 
relating to efficiency and other operating charac-
teristics as the Commission may promulgate by 
regulation; and 
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‘‘(B) the net sales of electricity from the fuel 
cell to customers not consuming the thermal out-
put from the fuel cell, if any, do not exceed 50 
percent of the total annual electricity generation 
by the fuel cell. 
‘‘(11) HIGH
CONSERVATION
PRIORITY
LAND.— 
The term ‘high conservation priority land’ means 
land that is not Federal land and is— 
‘‘(A) globally or State ranked as critically 
imperiled or imperiled under a State Natural 
Heritage Program; or 
‘‘(B) old-growth or late-successional forest, 
as identified by the office of the relevant State 
Forester or relevant State agency with regulatory 
jurisdiction over forestry activities. 
‘‘(12) OTHER QUALIFYING ENERGY RESOURCE.— 
The term ‘other qualifying energy resource’ means 
any of the following: 
‘‘(A) Landfill gas. 
‘‘(B) Wastewater treatment gas. 
‘‘(C) Coal mine methane used to generate 
electricity at or near the mine mouth. 
‘‘(D) Qualified waste-to-energy. 
‘‘(13) 
QUALIFIED
HYDROPOWER.—The 
term 
‘qualified hydropower’ means— 
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‘‘(A) energy produced from increased effi-
ciency achieved, or additions of capacity made, 
on or after January 1, 1992, at a hydroelectric 
facility that was placed in service before that 
date and does not include additional energy gen-
erated as a result of operational changes not di-
rectly associated with efficiency improvements or 
capacity additions; or 
‘‘(B) energy produced from generating ca-
pacity added to a dam on or after January 1, 
1992, provided that the Commission certifies 
that— 
‘‘(i) the dam was placed in service be-
fore the date of the enactment of this section 
and was operated for flood control, naviga-
tion, or water supply purposes and was not 
producing hydroelectric power prior to the 
addition of such capacity; 
‘‘(ii) the hydroelectric project installed 
on the dam is licensed (or is exempt from 
licensing) by the Commission and is in 
compliance with the terms and conditions of 
the license or exemption, and with other ap-
plicable legal requirements for the protec-
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tion of environmental quality, including 
applicable fish passage requirements; and 
‘‘(iii) the hydroelectric project installed 
on the dam is operated so that the water 
surface elevation at any given location and 
time that would have occurred in the ab-
sence of the hydroelectric project is main-
tained, subject to any license or exemption 
requirements that require changes in water 
surface elevation for the purpose of improv-
ing the environmental quality of the affected 
waterway. 
‘‘(14) QUALIFIED WASTE-TO-ENERGY.—The term 
‘qualified waste-to-energy’ means energy from the 
combustion of municipal solid waste or construction, 
demolition, or disaster debris, or from the gasification 
or pyrolization of such waste or debris and the com-
bustion of the resulting gas at the same facility, pro-
vided that— 
‘‘(A) such term shall include only the energy 
derived from the non-fossil biogenic portion of 
such waste or debris; 
‘‘(B) the Commission determines, with the 
concurrence of the Administrator of the Environ-
mental Protection Agency, that the total lifecycle 
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greenhouse gas emissions attributable to the gen-
eration of electricity from such waste or debris 
are lower than those attributable to the likely al-
ternative method of disposing of such waste or 
debris; and 
‘‘(C) the owner or operator of the facility 
generating electricity from such energy provides 
to the Commission, on an annual basis— 
‘‘(i) a certification that the facility is 
in compliance with all applicable State and 
Federal environmental permits; 
‘‘(ii) in the case of a facility that com-
menced operation before the date of enact-
ment of this section, a certification that the 
facility meets emissions standards promul-
gated under sections 112 or 129 of the Clean 
Air Act (42 U.S.C. 7412 or 7429) that 
apply as of the date of enactment of this 
section to new facilities within the relevant 
source category; and 
‘‘(iii) in the case of the combustion, 
pyrolization, or gasification of municipal 
solid waste, a certification that each local 
government unit from which such waste 
originates operates, participates in the oper-
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ation of, contracts for, or otherwise provides 
for, recycling services for its residents. 
‘‘(15) RECYCLED
ENERGY
SAVINGS.—The term 
‘recycled energy savings’ means a reduction in elec-
tricity consumption that results from a modification 
of an industrial or commercial system that com-
menced operation before the date of enactment of this 
section, in order to recapture electrical, mechanical, 
or thermal energy that would otherwise be wasted. 
‘‘(16) RENEWABLE BIOMASS.—The term ‘renew-
able biomass’ means any of the following: 
‘‘(A) Plant material, including waste mate-
rial, harvested or collected from actively man-
aged agricultural land that was in cultivation, 
cleared, or fallow and nonforested on January 1, 
2009. 
‘‘(B) Plant material, including waste mate-
rial, harvested or collected from pastureland that 
was nonforested on January 1, 2009. 
‘‘(C) Nonhazardous vegetative matter de-
rived from waste, including separated yard 
waste, landscape right-of-way trimmings, con-
struction and demolition debris or food waste 
(but not municipal solid waste, recyclable waste 
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paper, painted, treated or pressurized wood, or 
wood contaminated with plastic or metals). 
‘‘(D) Animal waste or animal byproducts, 
including products of animal waste digesters. 
‘‘(E) Algae. 
‘‘(F) Trees, brush, slash, residues, or any 
other vegetative matter removed from within 600 
feet of any building, campground, or route des-
ignated for evacuation by a public official with 
responsibility for emergency preparedness, or 
from within 300 feet of a paved road, electric 
transmission line, utility tower, or water supply 
line. 
‘‘(G) Residues from or byproducts of milled 
logs. 
‘‘(H) Any of the following removed from for-
ested land that is not Federal and is not high 
conservation priority land: 
‘‘(i) Trees, brush, slash, residues, inter-
planted energy crops, or any other vegeta-
tive matter removed from an actively man-
aged tree plantation established— 
‘‘(I) prior to January 1, 2009; or 
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‘‘(II) on land that, as of January 
1, 2009, was cultivated or fallow and 
non-forested. 
‘‘(ii) Trees, logging residue, thinnings, 
cull trees, pulpwood, and brush removed 
from naturally-regenerated forests or other 
non-plantation forests, including for the 
purposes of hazardous fuel reduction or pre-
ventative treatment for reducing or con-
taining insect or disease infestation. 
‘‘(iii) Logging residue, thinnings, cull 
trees, pulpwood, brush and species that are 
non-native and noxious, from stands that 
were planted and managed after January 1, 
2009, to restore or maintain native forest 
types. 
‘‘(iv) Dead or severely damaged trees 
removed within 5 years of fire, blowdown, 
or other natural disaster, and badly infested 
trees. 
‘‘(I) Materials, pre-commercial thinnings, 
or removed invasive species from National Forest 
System land and public lands (as defined in sec-
tion 103 of the Federal Land Policy and Man-
agement Act of 1976 (43 U.S.C. 1702)), includ-
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ing those that are byproducts of preventive treat-
ments (such as trees, wood, brush, thinnings, 
chips, and slash), that are removed as part of a 
federally recognized timber sale, or that are re-
moved to reduce hazardous fuels, to reduce or 
contain disease or insect infestation, or to restore 
ecosystem health, and that are— 
‘‘(i) not from components of the Na-
tional Wilderness Preservation System, Wil-
derness Study Areas, Inventoried Roadless 
Areas, old growth or mature forest stands, 
components of the National Landscape Con-
servation System, National Monuments, Na-
tional 
Conservation 
Areas, 
Designated 
Primitive Areas, or Wild and Scenic Rivers 
corridors; 
‘‘(ii) harvested in environmentally sus-
tainable quantities, as determined by the 
appropriate Federal land manager; and 
‘‘(iii) harvested in accordance with 
Federal and State law and applicable land 
management plans. 
‘‘(17) RENEWABLE ELECTRICITY.—The term ‘re-
newable electricity’ means electricity generated (in-
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cluding by means of a fuel cell) from a renewable en-
ergy resource or other qualifying energy resources. 
‘‘(18) RENEWABLE
ENERGY
RESOURCE.—The 
term ‘renewable energy resource’ means each of the 
following: 
‘‘(A) Wind energy. 
‘‘(B) Solar energy. 
‘‘(C) Geothermal energy. 
‘‘(D) Renewable biomass. 
‘‘(E) Biogas derived exclusively from renew-
able biomass. 
‘‘(F) Biofuels derived exclusively from re-
newable biomass. 
‘‘(G) Qualified hydropower. 
‘‘(H) Marine and hydrokinetic renewable 
energy, as that term is defined in section 632 of 
the Energy Independence and Security Act of 
2007 (42 U.S.C. 17211). 
‘‘(19) RETAIL ELECTRIC SUPPLIER.— 
‘‘(A) IN GENERAL.—The term ‘retail electric 
supplier’ means, for any given year, an electric 
utility that sold not less than 4,000,000 mega-
watt hours of electric energy to electric con-
sumers for purposes other than resale during the 
preceding calendar year. 
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‘‘(B) INCLUSIONS
AND
LIMITATIONS.—For 
purposes of determining whether an electric util-
ity qualifies as a retail electric supplier under 
subparagraph (A)— 
‘‘(i) the sales of any affiliate of an elec-
tric utility to electric consumers, other than 
sales to the affiliate’s lessees or tenants, for 
purposes other than resale shall be consid-
ered to be sales of such electric utility; and 
‘‘(ii) sales by any electric utility to an 
affiliate, lessee, or tenant of such electric 
utility shall not be treated as sales to elec-
tric consumers. 
‘‘(C) AFFILIATE.—For purposes of this 
paragraph, the term ‘affiliate’ when used in rela-
tion to a person, means another person that di-
rectly or indirectly owns or controls, is owned or 
controlled by, or is under common ownership or 
control with, such person, as determined under 
regulations promulgated by the Commission. 
‘‘(20) 
RETAIL
ELECTRIC
SUPPLIER’S
BASE 
AMOUNT.—The term ‘retail electric supplier’s base 
amount’ means the total amount of electric energy 
sold by the retail electric supplier, expressed in mega-
watt hours, to electric customers for purposes other 
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than resale during the relevant calendar year, exclud-
ing— 
‘‘(A) electricity generated by a hydroelectric 
facility that is not qualified hydropower; 
‘‘(B) electricity generated by a nuclear gen-
erating unit placed in service after the date of 
enactment of this section; and 
‘‘(C) the proportion of electricity generated 
by a fossil-fueled generating unit that is equal to 
the proportion of greenhouse gases produced by 
such unit that are captured and geologically se-
questered. 
‘‘(21) RETIRE AND RETIREMENT.—The terms ‘re-
tire’ and ‘retirement’ with respect to a Federal renew-
able electricity credit, means to disqualify such credit 
for any subsequent use under this section, regardless 
of whether the use is a sale, transfer, exchange, or sub-
mission in satisfaction of a compliance obligation. 
‘‘(22) THIRD-PARTY
EFFICIENCY
PROVIDER.— 
The term ‘third-party efficiency provider’ means any 
retailer, building owner, energy service company, fi-
nancial institution or other commercial, industrial or 
nonprofit entity that is capable of providing elec-
tricity savings in accordance with the requirements of 
this section. 
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‘‘(23) TOTAL ANNUAL ELECTRICITY SAVINGS.— 
The term ‘total annual electricity savings’ means elec-
tricity savings during a specified calendar year from 
measures that were placed into service since the date 
of the enactment of this section, taking into account 
verified measure lifetimes or verified annual savings 
attrition rates, as determined in accordance with such 
regulations as the Commission may promulgate and 
measured in megawatt hours. 
‘‘(b) ANNUAL COMPLIANCE OBLIGATION.— 
‘‘(1) IN GENERAL.—For each of calendar years 
2012 through 2039, not later than March 31 of the 
following calendar year, each retail electric supplier 
shall submit to the Commission an amount of Federal 
renewable electricity credits and demonstrated total 
annual electricity savings that, in the aggregate, is 
equal to such retail electric supplier’s annual com-
bined target as set forth in subsection (d), except as 
otherwise provided in subsection (g). 
‘‘(2) DEMONSTRATION
OF
SAVINGS.—For pur-
poses of this subsection, submission of demonstrated 
total annual electricity savings means submission of 
a report that demonstrates, in accordance with the re-
quirements of subsection (f), the total annual elec-
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tricity savings achieved by the retail electric supplier 
within the relevant compliance year. 
‘‘(3) RENEWABLE
ELECTRICITY
CREDITS
POR-
TION.—Except as provided in paragraph (4), each re-
tail electric supplier must submit Federal renewable 
electricity credits equal to at least three quarters of 
the retail electric supplier’s annual combined target. 
‘‘(4) STATE PETITION.— 
‘‘(A) IN GENERAL.—Upon written request 
from the Governor of any State (including, for 
purposes of this paragraph, the Mayor of the 
District of Columbia), the Commission shall in-
crease, to not more than two fifths, the propor-
tion of the annual combined targets of retail elec-
tric suppliers located within such State that may 
be met through submission of demonstrated total 
annual electricity savings, provided that such in-
crease shall be effective only with regard to the 
portion of a retail electric supplier’s annual 
combined target that is attributable to electricity 
sales within such State. 
‘‘(B) CONTENTS.—A Governor’s request 
under this paragraph shall include an expla-
nation of the Governor’s rationale for deter-
mining, after consultation with the relevant 
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State regulatory authority and other retail elec-
tricity ratemaking authorities within the State, 
to make such request. The request shall specify 
the maximum proportion of annual combined 
targets (not more than two fifths) that can be 
met through demonstrated total annual elec-
tricity savings, and the period for which such 
proportion shall be effective. 
‘‘(C) REVISION.—The Governor of any State 
may, after consultation with the relevant State 
regulatory authority and other retail electricity 
ratemaking authorities within the State, submit 
a written request for revocation or revision of a 
previous request submitted under this paragraph. 
The Commission shall grant such request, pro-
vided that— 
‘‘(i) any revocation or revision shall 
not apply to the combined annual target for 
any year that is any earlier than 2 cal-
endar years after the calendar year in 
which such request is submitted, so as to 
provide retail electric suppliers with ade-
quate notice of such change; and 
‘‘(ii) any revision shall meet the re-
quirements of subparagraph (A). 
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‘‘(c) ESTABLISHMENT OF PROGRAM.—Not later than 
1 year after the date of enactment of this section, the Com-
mission shall promulgate regulations to implement and en-
force the requirements of this section. In promulgating such 
regulations, the Commission shall, to the extent prac-
ticable— 
‘‘(1) preserve the integrity, and incorporate best 
practices, of existing State renewable electricity and 
energy efficiency programs; 
‘‘(2) rely upon existing and emerging State or 
regional tracking systems that issue and track non- 
Federal renewable electricity credits; and 
‘‘(3) cooperate with the States to facilitate co-
ordination between State and Federal renewable elec-
tricity and energy efficiency programs and to mini-
mize administrative burdens and costs to retail elec-
tric suppliers. 
‘‘(d) ANNUAL COMPLIANCE REQUIREMENT.— 
‘‘(1) ANNUAL COMBINED TARGETS.—For each of 
calendar years 2012 through 2039, a retail electric 
supplier’s annual combined target shall be the prod-
uct of— 
‘‘(A) the required annual percentage for 
such year, as set forth in paragraph (2); and 
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‘‘(B) the retail electric supplier’s base 
amount for such year. 
‘‘(2) REQUIRED
ANNUAL
PERCENTAGE.—For 
each of calendar years 2012 through 2039, the re-
quired annual percentage shall be as follows: 
‘‘Calendar year 
Required annual 
percentage 
2012 ......................................................................................
6.0 
2013 ......................................................................................
6.0 
2014 ......................................................................................
9.5 
2015 ......................................................................................
9.5 
2016 ......................................................................................
13.0 
2017 ......................................................................................
13.0 
2018 ......................................................................................
16.5 
2019 ......................................................................................
16.5 
2020 ......................................................................................
20.0 
2021 through 2039 ..............................................................
20.0 
‘‘(e) FEDERAL RENEWABLE ELECTRICITY CREDITS.— 
‘‘(1) IN GENERAL.—The regulations promulgated 
under this section shall include provisions governing 
the issuance, tracking, and verification of Federal re-
newable electricity credits. Except as provided in 
paragraphs (2), (3), and (4) of this subsection, the 
Commission shall issue to each generator of renewable 
electricity, 1 Federal renewable electricity credit for 
each megawatt hour of renewable electricity generated 
by such generator after December 31, 2011. The Com-
mission shall assign a unique serial number to each 
Federal renewable electricity credit. 
‘‘(2) GENERATION FROM CERTAIN STATE RENEW-
ABLE
ELECTRICITY
PROGRAMS.—Where renewable 
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electricity is generated with the support of payments 
from a retail electric supplier pursuant to a State re-
newable electricity program (whether through State 
alternative compliance payments or through pay-
ments to a State renewable electricity procurement 
fund or entity), the Commission shall issue Federal 
renewable electricity credits to such retail electric sup-
plier for the proportion of the relevant renewable elec-
tricity generation that is attributable to the retail 
electric supplier’s payments, as determined pursuant 
to regulations issued by the Commission. For any re-
maining portion of the relevant renewable electricity 
generation, the Commission shall issue Federal renew-
able electricity credits to the generator, as provided in 
paragraph (1), except that in no event shall more 
than 1 Federal renewable electricity credit be issued 
for the same megawatt hour of electricity. In deter-
mining how Federal renewable electricity credits will 
be apportioned among retail electric suppliers and 
generators in such circumstances, the Commission 
shall consider information and guidance furnished by 
the relevant State or States. 
‘‘(3) CERTAIN POWER SALES CONTRACTS.—When 
a generator has sold renewable electricity to a retail 
electric supplier under a contract for power from a 
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facility placed in service before the date of enactment 
of this section, and the contract does not provide for 
the determination of ownership of the Federal renew-
able electricity credits associated with such genera-
tion, the Commission shall issue such Federal renew-
able electricity credits to the retail electric supplier 
for the duration of the contract. 
‘‘(4) CREDIT MULTIPLIER FOR DISTRIBUTED RE-
NEWABLE GENERATION.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), the Commission shall issue 3 
Federal renewable electricity credits for each 
megawatt hour of renewable electricity generated 
by a distributed renewable generation facility. 
‘‘(B) ADJUSTMENT.—Except as provided in 
subparagraph (C), not later than January 1, 
2014, and not less frequently than every 4 years 
thereafter, the Commission shall review the effect 
of this paragraph and shall, as necessary, reduce 
the number of Federal renewable electricity cred-
its per megawatt hour issued under this para-
graph for any given energy source or technology, 
but not below 1, to ensure that such number is 
no higher than the Commission determines is 
necessary to make distributed renewable genera-
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tion facilities using such source or technology 
cost competitive with other sources of renewable 
electricity generation. 
‘‘(C) FACILITIES PLACED IN SERVICE AFTER 
ENACTMENT.—For any distributed renewable 
generation facility placed in service after the 
date of enactment of this section, subparagraph 
(B) shall not apply for the first 10 years after 
the date on which the facility is placed in serv-
ice. For each year during such 10-year period, 
the Commission shall issue to the facility the 
same number of Federal renewable electricity 
credits per megawatt hour as are issued to that 
facility in the year in which such facility is 
placed in service. After such 10-year period, the 
Commission shall issue Federal renewable elec-
tricity credits to the facility in accordance with 
the current multiplier as determined pursuant to 
subparagraph (B). 
‘‘(5) CREDITS
BASED
ON
QUALIFIED
HYDRO-
POWER.—For purposes of this subsection, the number 
of Federal renewable electricity credits issued for 
qualified hydropower shall be calculated— 
‘‘(A) based solely on the increase in average 
annual generation directly resulting from the ef-
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ficiency improvements or capacity additions de-
scribed in subsection (a)(13)(A); and 
‘‘(B) using the same water flow information 
used to determine a historic average annual gen-
eration baseline for the hydroelectric facility, as 
certified by the Commission. 
‘‘(6) GENERATION FROM MIXED RENEWABLE AND 
NONRENEWABLE
RESOURCES.—If electricity is gen-
erated using both a renewable energy resource or other 
qualifying energy resource and an energy source that 
is not a renewable energy resource or other qualifying 
energy resource (as, for example, in the case of co-fir-
ing of renewable biomass and fossil fuel), the Commis-
sion shall issue Federal renewable electricity credits 
based on the proportion of the electricity that is at-
tributable to the renewable energy resource or other 
qualifying energy resource. 
‘‘(7) PROHIBITION
AGAINST
DOUBLE-COUNT-
ING.—Except as provided in paragraph (4) of this 
subsection, the Commission shall ensure that no more 
than 1 Federal renewable electricity credit will be 
issued for any megawatt hour of renewable electricity 
and that no Federal renewable electricity credit will 
be used more than once for compliance with this sec-
tion. 
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‘‘(8) TRADING.—The lawful holder of a Federal 
renewable electricity credit may sell, exchange, trans-
fer, submit for compliance in accordance with sub-
section (b), or submit such credit for retirement by the 
Commission. 
‘‘(9) BANKING.—A Federal renewable electricity 
credit may be submitted in satisfaction of the compli-
ance obligation set forth in subsection (b) for the com-
pliance year in which the credit was issued or for any 
of the 3 immediately subsequent compliance years. 
The Commission shall retire any Federal renewable 
electricity credit that has not been retired by April 2 
of the calendar year that is 3 years after the calendar 
year in which the credit was issued. 
‘‘(10) RETIREMENT.—The Commission shall re-
tire a Federal renewable electricity credit imme-
diately upon submission by the lawful holder of such 
credit, whether in satisfaction of a compliance obliga-
tion under subsection (b) or on some other basis. 
‘‘(f) ELECTRICITY SAVINGS.— 
‘‘(1) STANDARDS
FOR
MEASUREMENT
OF
SAV-
INGS.—As part of the regulations promulgated under 
this section, the Commission shall prescribe standards 
and protocols for defining and measuring electricity 
savings and total annual electricity savings that can 
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be counted towards the compliance obligation set forth 
in subsection (b). Such protocols and standards shall, 
at minimum— 
‘‘(A) specify the types of energy efficiency 
and energy conservation measures that can be 
counted; 
‘‘(B) require that energy consumption esti-
mates for customer facilities or portions of facili-
ties in the applicable base and current years be 
adjusted, as appropriate, to account for changes 
in weather, level of production, and building 
area; 
‘‘(C) account for the useful life of measures; 
‘‘(D) include deemed savings values for spe-
cific, commonly used measures; 
‘‘(E) allow for savings from a program to 
be estimated based on extrapolation from a rep-
resentative sample of participating customers; 
‘‘(F) include procedures for counting CHP 
savings, recycled energy savings, and fuel cell 
savings; 
‘‘(G) include procedures for counting elec-
tricity savings achieved by solar water heating 
and solar light pipe technology that has the ca-
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pability to provide measureable data on the 
amount of megawatt-hours displaced; 
‘‘(H) avoid double-counting of savings used 
for compliance with this section, including sav-
ings that are transferred pursuant to paragraph 
(3); 
‘‘(I) ensure that, except as provided in sub-
paragraph (K), the retail electric supplier claim-
ing the savings played a significant role in 
achieving the savings (including through the ac-
tivities of a designated agent of the supplier or 
through the purchase of transferred savings); 
‘‘(J) include savings from programs admin-
istered by a retail electric supplier (or a retail 
electricity distributor that is not a retail electric 
supplier) that are funded by State, Federal, or 
other sources; 
‘‘(K) in any State in which the State regu-
latory authority has designated 1 or more enti-
ties to administer electric ratepayer-funded effi-
ciency programs approved by such State regu-
latory authority, provide that electricity savings 
achieved through such programs shall be distrib-
uted equitably among retail electric suppliers in 
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accordance with the direction of the relevant 
State regulatory authority; and 
‘‘(L) exclude savings achieved as a result of 
compliance with mandatory appliance and 
equipment efficiency standards or building codes. 
‘‘(2) 
STANDARDS
FOR
THIRD-PARTY 
VERIFICATION OF SAVINGS.—The regulations promul-
gated under this section shall establish procedures and 
standards requiring third-party verification of all re-
ported electricity savings, including requirements for 
accreditation of third-party verifiers to ensure that 
such verifiers are professionally qualified and have no 
conflicts of interest. 
‘‘(3) TRANSFERS OF SAVINGS.— 
‘‘(A) BILATERAL CONTRACTS FOR SAVINGS 
TRANSFERS.—Subject to the limitations of this 
paragraph, a retail electric supplier may use 
electricity savings transferred, pursuant to a bi-
lateral contract, from another retail electric sup-
plier, an owner of an electric distribution facil-
ity that is not a retail electric supplier, a State, 
or a third-party efficiency provider to meet the 
applicable compliance obligation under sub-
section (b). 
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‘‘(B) REQUIREMENTS.—Electricity savings 
transferred and used for compliance pursuant to 
this paragraph shall be— 
‘‘(i) measured and verified in accord-
ance with the procedures specified under 
this subsection; 
‘‘(ii) reported in accordance with para-
graph (4) of this subsection; and 
‘‘(iii) achieved within the same State 
as is served by the retail electric supplier. 
‘‘(C) REGULATORY APPROVAL.—Nothing in 
this paragraph shall limit or affect the authority 
of a State regulatory authority to require a re-
tail electric supplier that is regulated by such 
authority to obtain such authority’s authoriza-
tion or approval of a contract for transfer of sav-
ings under this paragraph. 
‘‘(4) REPORTING SAVINGS.— 
‘‘(A) 
REQUIREMENTS.—The 
regulations 
promulgated under this section shall establish re-
quirements governing the submission of reports 
to demonstrate, in accordance with the protocols 
and standards for measurement and third-party 
verification established under this subsection, the 
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total annual electricity savings achieved by a re-
tail electric supplier within the relevant year. 
‘‘(B) REVIEW AND APPROVAL.—The Com-
mission shall review each report submitted to the 
Commission by a retail electric supplier and 
shall exclude any electricity savings that have 
not been adequately demonstrated in accordance 
with the requirements of this subsection. 
‘‘(5) STATE ADMINISTRATION.— 
‘‘(A) DELEGATION
OF
AUTHORITY.—Upon 
receipt of an application from the Governor of a 
State (including, for purposes of this subsection, 
the Mayor of the District of Columbia), the Com-
mission may delegate to the State the authority 
to review and verify reported electricity savings 
for purposes of determining demonstrated total 
annual electricity savings that may be counted 
towards a retail electric supplier’s compliance 
obligation under subsection (b). The Commission 
shall make a substantive determination approv-
ing or disapproving a State application under 
this subparagraph, after notice and comment, 
within 180 days of receipt of a complete applica-
tion. 
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‘‘(B) ALTERNATIVE
MEASUREMENT
AND 
VERIFICATION PROCEDURES AND STANDARDS.— 
As part of an application submitted under sub-
paragraph (A), a State may request to use alter-
native measurement and verification procedures 
and standards to those specified in paragraphs 
(1) and (2), provided the State demonstrates that 
such alternative procedures and standards pro-
vide a level of accuracy of measurement and 
verification at least equivalent to the Federal 
procedures and standards promulgated under 
paragraphs (1) and (2). 
‘‘(C) REVIEW
OF
STATE
IMPLEMENTA-
TION.—The Commission shall, not less frequently 
than once every 4 years, review each State’s im-
plementation of delegated authority under this 
paragraph to ensure conformance with the re-
quirements of this section. The Commission may, 
at any time, revoke the delegation of authority 
under this section upon a finding that the State 
is not implementing its delegated responsibilities 
in conformity with this paragraph. As a condi-
tion of maintaining its delegated authority 
under this paragraph, the Commission may re-
quire a State to submit a revised application 
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under subparagraph (A) if the Commission 
has— 
‘‘(i) promulgated new or substantially 
revised measurement and verification proce-
dures and standards under this subsection; 
or 
‘‘(ii) otherwise substantially revised the 
program established under this section. 
‘‘(g) ALTERNATIVE COMPLIANCE PAYMENTS.— 
‘‘(1) IN
GENERAL.—A retail electric supplier 
may satisfy the requirements of subsection (b) in 
whole or in part by submitting in accordance with 
this subsection, in lieu of each Federal renewable elec-
tricity credit or megawatt hour of demonstrated total 
annual electricity savings that would otherwise be 
due, a payment equal to $25, adjusted for inflation 
on January 1 of each year following calendar year 
2009, in accordance with such regulations as the 
Commission may promulgate. 
‘‘(2) PAYMENT TO STATE FUNDS.—Except as oth-
erwise provided in this paragraph, payments made 
under this subsection shall be made directly to the 
State or States in which the retail electric supplier is 
located, in proportion to the portion of the retail elec-
tric supplier’s base amount that is sold within each 
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relevant State, provided that such payments are de-
posited directly into a fund in the State treasury es-
tablished for this purpose and that the State uses such 
funds in accordance with paragraphs (3) and (4). If 
the Commission determines at any time that a State 
is in substantial noncompliance with paragraph (3) 
or (4), the Commission shall direct that any future 
alternative compliance payments that would other-
wise be paid to such State under this subsection shall 
instead be paid to the Commission and deposited in 
the United States Treasury. 
‘‘(3) STATE USE OF FUNDS.—As a condition of 
continued receipt of alternative compliance payments 
pursuant to this subsection, a State shall use such 
payments exclusively for the purposes of— 
‘‘(A) deploying technologies that generate 
electricity from renewable energy resources; or 
‘‘(B) implementing cost-effective energy effi-
ciency programs to achieve electricity savings. 
‘‘(4) REPORTING.—As a condition of continued 
receipt of alternative compliance payments pursuant 
to this subsection, a State shall, within 12 months of 
receipt of any such payments and at 12-month inter-
vals thereafter until such payments are expended, pro-
vide a report to the Commission, in accordance with 
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such regulations as the Commission may prescribe, 
giving a full accounting of the use of such payments, 
including a detailed description of the activities fund-
ed thereby. 
‘‘(h) INFORMATION COLLECTION.—The Commission 
may require any retail electric supplier, renewable elec-
tricity generator, or such other entities as the Commission 
deems appropriate, to provide any information the Com-
mission determines appropriate to carry out this section. 
Failure to submit such information or submission of false 
or misleading information under this subsection shall be a 
violation of this section. 
‘‘(i) ENFORCEMENT AND JUDICIAL REVIEW.— 
‘‘(1) FAILURE
TO
SUBMIT
CREDITS
OR
DEM-
ONSTRATE SAVINGS.—If any person fails to comply 
with the requirements of subsection (b) or (g), such 
person shall be liable to pay to the Commission a 
civil penalty equal to the product of— 
‘‘(A) double the alternative compliance pay-
ment calculated under subsection (g)(1), and 
‘‘(B) the aggregate quantity of Federal re-
newable electricity credits, total annual elec-
tricity savings, or equivalent alternative compli-
ance payments that the person failed to submit 
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in violation of the requirements of subsections (b) 
and (g). 
‘‘(2) ENFORCEMENT.—The Commission shall as-
sess a civil penalty under paragraph (1) in accord-
ance with the procedures described in section 31(d) of 
the Federal Power Act (16 U.S.C. 823b(d)). 
‘‘(3) VIOLATION OF REQUIREMENT OF REGULA-
TIONS OR ORDERS.—Any person who violates, or fails 
or refuses to comply with, any requirement of a regu-
lation promulgated or order issued under this section 
shall be subject to a civil penalty under section 
316A(b) of the Federal Power Act (16 U.S.C. 825o– 
1). Such penalty shall be assessed by the Commission 
in the same manner as in the case of a violation re-
ferred to in section 316A(b) of such Act. 
‘‘(j) JUDICIAL REVIEW.—Any person aggrieved by a 
final action taken by the Commission under this section, 
other than the assessment of a civil penalty under sub-
section (i), may use the procedures for review described in 
section 313 of the Federal Power Act (16 U.S.C. 825l). For 
purposes of this paragraph, references to an order in section 
313 of such Act shall be deemed to refer also to all other 
final actions of the Commission under this section other 
than the assessment of a civil penalty under subsection (i). 
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‘‘(l) SUNSET.—This section expires on December 31, 
2040.’’. 
(b) CONFORMING AMENDMENT.—The table of contents 
set forth in section 1(b) of the Public Utility Regulatory 
Policies Act of 1978 (16 U.S.C. 2601 and following) is 
amended by inserting after the item relating to section 609 
the following: 
‘‘Sec. 610. Combined efficiency and renewable electricity standard.’’. 
SEC. 102. CLARIFYING STATE AUTHORITY TO ADOPT RE-
NEWABLE ENERGY INCENTIVES. 
Section 210 of the Public Utility Regulatory Policies 
Act of 1978 is amended by adding at the end thereof: 
‘‘(o) CLARIFICATION OF STATE AUTHORITY TO ADOPT 
RENEWABLE ENERGY INCENTIVES.—Notwithstanding any 
other provision of this Act or the Federal Power Act, a State 
legislature or regulatory authority may set the rates for a 
sale of electric energy by a facility generating electric en-
ergy from renewable energy sources pursuant to a State- 
approved production incentive program under which the fa-
cility voluntarily sells electric energy. For purposes of this 
subsection, ‘State-approved production incentive program’ 
means a requirement imposed pursuant to State law, or 
by a State regulatory authority acting within its authority 
under State law, that an electric utility purchase renewable 
energy (as defined in section 609 of this Act) at a specified 
rate.’’. 
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Subtitle B—Carbon Capture and 
Sequestration 
SEC. 111. NATIONAL STRATEGY. 
(a) IN GENERAL.—Not later than 1 year after the date 
of enactment of this Act, the Administrator, in consultation 
with the Secretary of Energy and the heads of such other 
relevant Federal agencies as the President may designate, 
shall submit to Congress a report setting forth a unified 
and comprehensive strategy to address the key legal, regu-
latory and other barriers to the commercial-scale deploy-
ment of carbon capture and sequestration. 
(b) BARRIERS.— The report under this section shall— 
(1) identify those regulatory, legal, and other 
gaps and barriers that could be addressed by a Fed-
eral agency using existing statutory authority, those, 
if any, that require Federal legislation, and those that 
would be best addressed at the State or regional level; 
(2) identify regulatory implementation chal-
lenges, including those related to approval of State 
programs and delegation of authority for permitting; 
and 
(3) recommend rulemakings, Federal legislation, 
or other actions that should be taken to further evalu-
ate and address such barriers. 
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SEC. 112. REGULATIONS FOR GEOLOGIC SEQUESTRATION 
SITES. 
(a) COORDINATED CERTIFICATION AND PERMITTING 
PROCESS.—Title VIII of the Clean Air Act, as added by 
section 331 of this Act, is amended by adding after section 
812 (as added by section 116 of this Act) the following: 
‘‘SEC. 813. GEOLOGIC SEQUESTRATION SITES. 
‘‘(a) COORDINATED
PROCESS.—The Administrator 
shall establish a coordinated approach to certifying and 
permitting geologic sequestration, taking into consideration 
all relevant statutory authorities. In establishing such ap-
proach, the Administrator shall— 
‘‘(1) take into account, and reduce redundancy 
with, the requirements of section 1421 of the Safe 
Drinking Water Act (42 U.S.C. 300h), as amended by 
section 112(b) of the American Clean Energy and Se-
curity Act of 2009, including the rulemaking for geo-
logic sequestration wells described at 73 Fed. Reg. 
43491-541 (July 25, 2008); and 
‘‘(2) to the extent practicable, reduce the burden 
on certified entities and implementing authorities. 
‘‘(b) REGULATIONS.—Not later than 2 years after the 
date of enactment of this title, the Administrator shall pro-
mulgate regulations to protect human health and the envi-
ronment by minimizing the risk of escape to the atmosphere 
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of carbon dioxide injected for purposes of geologic sequestra-
tion. 
‘‘(c) REQUIREMENTS.—The regulations under sub-
section (b) shall include— 
‘‘(1) a process to obtain certification for geologic 
sequestration under this section; and 
‘‘(2) requirements for— 
‘‘(A) monitoring, record keeping, and re-
porting for emissions associated with injection 
into, and escape from, geologic sequestration 
sites, taking into account any requirements or 
protocols developed under section 713; 
‘‘(B) public participation in the certifi-
cation process that maximizes transparency; 
‘‘(C) the sharing of data between States, In-
dian tribes, and the Environmental Protection 
Agency; and 
‘‘(D) other elements or safeguards necessary 
to achieve the purpose set forth in subsection (b). 
‘‘(d) REPORT.—Not later than 2 years after the pro-
mulgation of regulations under subsection (b), and at 3- 
year intervals thereafter, the Administrator shall deliver to 
the Committee on Energy and Commerce of the House of 
Representatives and the Committee on Environment and 
Public Works of the Senate a report on geologic sequestra-
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tion in the United States, and, to the extent relevant, other 
countries in North America. Such report shall include— 
‘‘(1) data regarding injection, emissions to the 
atmosphere, if any, and performance of active and 
closed geologic sequestration sites, including those 
where enhanced hydrocarbon recovery operations 
occur; 
‘‘(2) an evaluation of the performance of relevant 
Federal environmental regulations and programs in 
ensuring environmentally protective geologic seques-
tration practices; 
‘‘(3) recommendations on how such programs 
and regulations should be improved or made more ef-
fective; and 
‘‘(4) other relevant information.’’. 
(b) SAFE DRINKING WATER ACT STANDARDS.—Sec-
tion 1421 of the Safe Drinking Water Act (42 U.S.C. 300h) 
is amended by inserting after subsection (d) the following: 
‘‘(e) CARBON DIOXIDE GEOLOGIC SEQUESTRATION 
WELLS.— 
‘‘(1) IN GENERAL.—Not later than 1 year after 
the date of enactment of this subsection, the Adminis-
trator shall promulgate regulations under subsection 
(a) for carbon dioxide geologic sequestration wells. 
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cent reduction in emissions of the carbon 
dioxide produced by— 
‘‘(I) the unit, measured on an an-
nual basis, determined in accordance 
with section 812(b)(2); or 
‘‘(II) in the case of retrofit appli-
cations under clause (ii), the treated 
portion of flue gas from the unit, meas-
ured on an annual basis, determined 
in accordance with section 812(b)(2); 
or 
‘‘(B) at an industrial source that— 
‘‘(i) absent carbon capture and seques-
tration, would emit greater than 50,000 
tons per year of carbon dioxide; 
‘‘(ii) 
upon 
implementation, 
will 
achieve an emission limit that is at least a 
50 percent reduction in emissions of the 
carbon dioxide produced by the emission 
point, measured on an annual basis, deter-
mined in accordance with section 812(b)(2); 
and 
‘‘(iii) does not produce a liquid trans-
portation fuel from a solid fossil-based feed-
stock; 
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126 
enforcement of measures to prevent and penalize 
fraud under the Program. 
(b) QUALIFICATIONS
FOR
AND VALUE
OF VOUCH-
ERS.—A voucher issued under the Program shall have a 
value that may be applied to offset the purchase price or 
lease price for a qualifying lease of a new fuel efficient auto-
mobile as follows: 
(1) $3,500 VALUE.—The voucher may be used to 
offset the purchase price or lease price of the new fuel 
efficient automobile by $3,500 if— 
(A) the new fuel efficient automobile is a 
passenger automobile and the combined fuel 
economy value of such automobile is at least 4 
miles per gallon higher than the combined fuel 
economy value of the eligible trade-in vehicle; 
(B) the new fuel efficient automobile is a 
category 1 truck and the combined fuel economy 
value of such truck is at least 2 miles per gallon 
higher than the combined fuel economy value of 
the eligible trade-in vehicle; 
(C) the new fuel efficient automobile is a 
category 2 truck that has a combined fuel econ-
omy value of at least 15 miles per gallon and— 
(i) the eligible trade-in vehicle is a cat-
egory 2 truck and the combined fuel econ-
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127 
omy value of the new fuel efficient auto-
mobile is at least 1 mile per gallon higher 
than the combined fuel economy value of the 
eligible trade-in vehicle; or 
(ii) the eligible trade-in vehicle is a 
category 3 truck of model year 2001 or ear-
lier; or 
(D) the new fuel efficient automobile is a 
category 3 truck and the eligible trade-in vehicle 
is a category 3 truck of model year of 2001 or 
earlier and is of similar size or larger than the 
new fuel efficient automobile as determined in a 
manner prescribed by the Secretary. 
(2) $4,500 VALUE.—The voucher may be used to 
offset the purchase price or lease price of the new fuel 
efficient automobile by $4,500 if— 
(A) the new fuel efficient automobile is a 
passenger automobile and the combined fuel 
economy value of such automobile is at least 10 
miles per gallon higher than the combined fuel 
economy value of the eligible trade-in vehicle; 
(B) the new fuel efficient automobile is a 
category 1 truck and the combined fuel economy 
value of such truck is at least 5 miles per gallon 
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