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basis of such property which would (but for this subsection)
result from such expenditure shall be reduced by the amount
of the credit so allowed.
‘‘(g) TERMINATION.—The credit allowed under this
section shall not apply to property placed in service after
December 31, 2009.’’.
(b) CONFORMING AMENDMENTS.—
(1) Section 23(c) is amended by striking ‘‘this
section and section 1400C’’ and inserting ‘‘this sec-
tion, section 25D, and section 1400C’’.
(2) Section 25(e)(1)(C) is amended by striking
‘‘this section and sections 23 and 1400C’’ and insert-
ing ‘‘other than this section, section 23, section 25D,
and section 1400C’’.
(3) Section 1400C(d) is amended by striking
‘‘this section’’ and inserting ‘‘this section and section
25D’’.
(4) Section 1016(a), as amended by this Act, is
amended by striking ‘‘and’’ at the end of paragraph
(34), by striking the period at the end of paragraph
(35) and inserting ‘‘, and’’, and by adding at the end
the following new paragraph:
‘‘(36) to the extent provided in section 25D(f), in
the case of amounts with respect to which a credit has
been allowed under section 25D.’’.
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(5) The table of sections for subpart A of part IV
of subchapter A of chapter 1, as amended by this Act,
is amended by inserting after the item relating to sec-
tion 25C the following new item:
‘‘Sec. 25D. Residential energy efficient property.’’.
(c) EFFECTIVE DATES.—The amendments made by
this section shall apply to property placed in service after
December 31, 2005, in taxable years ending after such date.
SEC. 1528. CREDIT FOR BUSINESS INSTALLATION OF QUALI-
FIED FUEL CELLS AND STATIONARY MICRO-
TURBINE POWER PLANTS.
(a) IN GENERAL.—Section 48(a)(3)(A) (defining en-
ergy property), as amended by this Act, is amended by
striking ‘‘or’’ at the end of clause (ii), by adding ‘‘or’’ at
the end of clause (iii), and by inserting after clause (iii)
the following new clause:
‘‘(iv) qualified fuel cell property or
qualified microturbine property,’’.
(b) QUALIFIED FUEL CELL PROPERTY; QUALIFIED
MICROTURBINE PROPERTY.—Section 48 (relating to energy
credit) is amended by adding at the end the following new
subsection:
‘‘(d) QUALIFIED FUEL CELL PROPERTY; QUALIFIED
MICROTURBINE
PROPERTY.—For 
purposes 
of 
this
subsection—
‘‘(1) QUALIFIED FUEL CELL PROPERTY.—
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‘‘(A) IN GENERAL.—The term ‘qualified fuel
cell property’ means a fuel cell power plant
which—
‘‘(i) has a nameplate capacity of at
least 0.5 kilowatt of electricity using an
electrochemical process, and
‘‘(ii) has an electricity-only generation
efficiency greater than 30 percent.
‘‘(B) LIMITATION.—In the case of qualified
fuel cell property placed in service during the
taxable year, the credit otherwise determined
under paragraph (1) for such year with respect
to such property shall not exceed an amount
equal to $500 for each 0.5 kilowatt of capacity
of such property.
‘‘(C) FUEL CELL POWER PLANT.—The term
‘fuel cell power plant’ means an integrated sys-
tem comprised of a fuel cell stack assembly and
associated balance of plant components which
converts a fuel into electricity using electro-
chemical means.
‘‘(D) SPECIAL RULE.—The first sentence of
the matter in subsection (a)(3) which follows
subparagraph (D) thereof shall not apply to
qualified fuel cell property which is used pre-
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HR 6 EAS
dominantly in the trade or business of the fur-
nishing or sale of telephone service, telegraph
service by means of domestic telegraph oper-
ations, or other telegraph services (other than
international telegraph services).
‘‘(E) TERMINATION.—The term ‘qualified
fuel cell property’ shall not include any property
for any period after December 31, 2009.
‘‘(2) QUALIFIED MICROTURBINE PROPERTY.—
‘‘(A) IN
GENERAL.—The term ‘qualified
microturbine property’ means a stationary
microturbine power plant which—
‘‘(i) has a nameplate capacity of less
than 2,000 kilowatts, and
‘‘(ii) has an electricity-only generation
efficiency of not less than 26 percent at
International Standard Organization con-
ditions.
‘‘(B) LIMITATION.—In the case of qualified
microturbine property placed in service during
the taxable year, the credit otherwise determined
under paragraph (1) for such year with respect
to such property shall not exceed an amount
equal $200 for each kilowatt of capacity of such
property.
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‘‘(C) STATIONARY
MICROTURBINE
POWER
PLANT.—The 
term 
‘stationary 
microturbine
power plant’ means an integrated system com-
prised of a gas turbine engine, a combustor, a
recuperator or regenerator, a generator or alter-
nator, and associated balance of plant compo-
nents which converts a fuel into electricity and
thermal energy. Such term also includes all sec-
ondary components located between the existing
infrastructure for fuel delivery and the existing
infrastructure for power distribution, including
equipment and controls for meeting relevant
power standards, such as voltage, frequency, and
power factors.
‘‘(D) SPECIAL RULE.—The first sentence of
the matter in subsection (a)(3) which follows
subparagraph (D) thereof shall not apply to
qualified microturbine property which is used
predominantly in the trade or business of the
furnishing or sale of telephone service, telegraph
service by means of domestic telegraph oper-
ations, or other telegraph services (other than
international telegraph services).
‘‘(E) TERMINATION.—The term ‘qualified
microturbine property’ shall not include any
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property for any period after December 31,
2008.’’.
(c) ENERGY PERCENTAGE.—Section 48(a)(2)(A) (re-
lating to energy percentage) is amended to read as follows:
‘‘(A) IN GENERAL.—The energy percentage
is—
‘‘(i) in the case of qualified fuel cell
property, 30 percent, and
‘‘(ii) in the case of any other energy
property, 10 percent.’’.
(d) CONFORMING AMENDMENT.— Section 48(a)(1) is
amended by inserting ‘‘except as provided in paragraph
(1)(B) or (2)(B) of subsection (d),’’ before ‘‘the energy’’.
(e) EFFECTIVE DATE.—The amendments made by this
section shall apply to periods after December 31, 2005, in
taxable years ending after such date, under rules similar
to the rules of section 48(m) of the Internal Revenue Code
of 1986 (as in effect on the day before the date of the enact-
ment of the Revenue Reconciliation Act of 1990).
SEC. 1529. BUSINESS SOLAR INVESTMENT TAX CREDIT.
(a) INCREASE
IN ENERGY PERCENTAGE.—Section
48(a)(2)(A) (relating to energy percentage), as amended by
this Act, is amended to read as follows:
‘‘(A) IN GENERAL.—The energy percentage
is—
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HR 6 EAS
‘‘(i) in the case of energy property de-
scribed in paragraph (3)(A)(i) and quali-
fied fuel cell property, 30 percent, and
‘‘(ii) in the case of any other energy
property, 10 percent.’’.
(b) HYBRID SOLAR LIGHTING SYSTEMS.—Clause (i)
of section 48(a)(3)(A) is amended to read as follows:
‘‘(i) equipment which uses solar energy
to generate electricity, to heat or cool (or
provide hot water for use in) a structure, to
illuminate the inside of a structure using
fiber-optic distributed sunlight or to provide
solar process heat, excepting property used
to generate energy for the purposes of heat-
ing a swimming pool,’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to periods after December 31, 2005, in
taxable years ending after such date, and periods before
January 1, 2012, 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).
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Subtitle D—Alternative Motor
Vehicles and Fuels Incentives
SEC. 1531. ALTERNATIVE MOTOR VEHICLE CREDIT.
(a) IN GENERAL.—Subpart B of part IV of subchapter
A of chapter 1 (relating to foreign tax credit, etc.) is amend-
ed by adding at the end the following new section:
‘‘SEC. 30B. ALTERNATIVE MOTOR VEHICLE CREDIT.
‘‘(a) ALLOWANCE OF CREDIT.—There shall be allowed
as a credit against the tax imposed by this chapter for the
taxable year an amount equal to the sum of—
‘‘(1) the new qualified fuel cell motor vehicle
credit determined under subsection (b),
‘‘(2) the new qualified hybrid motor vehicle cred-
it determined under subsection (c), and
‘‘(3) the new qualified alternative fuel motor ve-
hicle credit determined under subsection (d).
‘‘(b) NEW QUALIFIED FUEL CELL MOTOR VEHICLE
CREDIT.—
‘‘(1) IN GENERAL.—For purposes of subsection
(a), the new qualified fuel cell motor vehicle credit de-
termined under this subsection with respect to a new
qualified fuel cell motor vehicle placed in service by
the taxpayer during the taxable year is—
‘‘(A) $8,000 ($4,000 in the case of a vehicle
placed in service after December 31, 2009), if
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HR 6 EAS
such vehicle has a gross vehicle weight rating of
not more than 8,500 pounds,
‘‘(B) $10,000, if such vehicle has a gross ve-
hicle weight rating of more than 8,500 pounds
but not more than 14,000 pounds,
‘‘(C) $20,000, if such vehicle has a gross ve-
hicle weight rating of more than 14,000 pounds
but not more than 26,000 pounds, and
‘‘(D) $40,000, if such vehicle has a gross ve-
hicle weight rating of more than 26,000 pounds.
‘‘(2) INCREASE FOR FUEL EFFICIENCY.—
‘‘(A) IN GENERAL.—The amount determined
under paragraph (1)(A) with respect to a new
qualified fuel cell motor vehicle which is a pas-
senger automobile or light truck shall be in-
creased by—
‘‘(i) $1,000, if such vehicle achieves at
least 150 percent but less than 175 percent
of the 2002 model year city fuel economy,
‘‘(ii) $1,500, if such vehicle achieves at
least 175 percent but less than 200 percent
of the 2002 model year city fuel economy,
‘‘(iii) $2,000, if such vehicle achieves
at least 200 percent but less than 225 per-
†
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HR 6 EAS
cent of the 2002 model year city fuel econ-
omy,
‘‘(iv) $2,500, if such vehicle achieves at
least 225 percent but less than 250 percent
of the 2002 model year city fuel economy,
‘‘(v) $3,000, if such vehicle achieves at
least 250 percent but less than 275 percent
of the 2002 model year city fuel economy,
‘‘(vi) $3,500, if such vehicle achieves at
least 275 percent but less than 300 percent
of the 2002 model year city fuel economy,
and
‘‘(vii) $4,000, if such vehicle achieves
at least 300 percent of the 2002 model year
city fuel economy.
‘‘(B) 2002 MODEL YEAR CITY FUEL ECON-
OMY.—For purposes of subparagraph (A), the
2002 model year city fuel economy with respect
to a vehicle shall be determined in accordance
with the following tables:
‘‘(i) In the case of a passenger auto-
mobile:
The 2002 model year city
‘‘If vehicle inertia weight class is:
fuel economy is:
1,500 or 1,750 lbs ..........................................................................
45.2 mpg
2,000 lbs ..........................................................................................
39.6 mpg
2,250 lbs ..........................................................................................
35.2 mpg
2,500 lbs ..........................................................................................
31.7 mpg
2,750 lbs ..........................................................................................
28.8 mpg
3,000 lbs ..........................................................................................
26.4 mpg
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HR 6 EAS
The 2002 model year city
‘‘If vehicle inertia weight class is:
fuel economy is:
3,500 lbs ..........................................................................................
22.6 mpg
4,000 lbs ..........................................................................................
19.8 mpg
4,500 lbs ..........................................................................................
17.6 mpg
5,000 lbs ..........................................................................................
15.9 mpg
5,500 lbs ..........................................................................................
14.4 mpg
6,000 lbs ..........................................................................................
13.2 mpg
6,500 lbs ..........................................................................................
12.2 mpg
7,000 to 8,500 lbs ...........................................................................
11.3 mpg.
‘‘(ii) In the case of a light truck:
The 2002 model year city
‘‘If vehicle inertia weight class is:
fuel economy is:
1,500 or 1,750 lbs ..........................................................................
39.4 mpg
2,000 lbs ..........................................................................................
35.2 mpg
2,250 lbs ..........................................................................................
31.8 mpg
2,500 lbs ..........................................................................................
29.0 mpg
2,750 lbs ..........................................................................................
26.8 mpg
3,000 lbs ..........................................................................................
24.9 mpg
3,500 lbs ..........................................................................................
21.8 mpg
4,000 lbs ..........................................................................................
19.4 mpg
4,500 lbs ..........................................................................................
17.6 mpg
5,000 lbs ..........................................................................................
16.1 mpg
5,500 lbs ..........................................................................................
14.8 mpg
6,000 lbs ..........................................................................................
13.7 mpg
6,500 lbs ..........................................................................................
12.8 mpg
7,000 to 8,500 lbs ...........................................................................
12.1 mpg.
‘‘(C) VEHICLE INERTIA WEIGHT CLASS.—
For purposes of subparagraph (B), the term ‘ve-
hicle inertia weight class’ has the same meaning
as when defined in regulations prescribed by the
Administrator of the Environmental Protection
Agency for purposes of the administration of title
II of the Clean Air Act (42 U.S.C. 7521 et seq.).
‘‘(3) NEW QUALIFIED FUEL CELL MOTOR VEHI-
CLE.—For purposes of this subsection, the term ‘new
qualified fuel cell motor vehicle’ means a motor
vehicle—
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HR 6 EAS
‘‘(A) which is propelled by power derived
from 1 or more cells which convert chemical en-
ergy directly into electricity by combining oxy-
gen with hydrogen fuel which is stored on board
the vehicle in any form and may or may not re-
quire reformation prior to use,
‘‘(B) which, in the case of a passenger auto-
mobile or light truck, has received on or after the
date of the enactment of this section a certificate
that such vehicle meets or exceeds the Bin 5 Tier
II emission level established in regulations pre-
scribed by the Administrator of the Environ-
mental Protection Agency under section 202(i) of
the Clean Air Act for that make and model year
vehicle,
‘‘(C) the original use of which commences
with the taxpayer,
‘‘(D) which is acquired for use or lease by
the taxpayer and not for resale, and
‘‘(E) which is made by a manufacturer.
‘‘(c) NEW QUALIFIED HYBRID MOTOR VEHICLE CRED-
IT.—
‘‘(1) IN GENERAL.—For purposes of subsection
(a), the new qualified hybrid motor vehicle credit de-
termined under this subsection with respect to a new
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HR 6 EAS
qualified hybrid motor vehicle placed in service by the
taxpayer during the taxable year is the credit amount
determined under paragraph (2) or (3).
‘‘(2) CREDIT
AMOUNT
FOR
LIGHTER
VEHI-
CLES.—
‘‘(A) IN GENERAL.—In the case of a new
qualified hybrid motor vehicle which is a pas-
senger automobile, medium duty passenger vehi-
cle, or light truck, the credit amount determined
under this paragraph shall be—
‘‘(i) $400, if such vehicle achieves at
least 125 percent but less than 150 percent
of the 2002 model year city fuel economy,
‘‘(ii) $800, if such vehicle achieves at
least 150 percent but less than 175 percent
of the 2002 model year city fuel economy,
‘‘(iii) $1,200, if such vehicle achieves
at least 175 percent but less than 200 per-
cent of the 2002 model year city fuel econ-
omy,
‘‘(iv) $1,600, if such vehicle achieves at
least 200 percent but less than 225 percent
of the 2002 model year city fuel economy,
‘‘(v) $2,000, if such vehicle achieves at
least 225 percent but less than 250 percent
†
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HR 6 EAS
of the 2002 model year city fuel economy,
and
‘‘(vi) $2,400, if such vehicle achieves at
least 250 percent of the 2002 model year
city fuel economy.
‘‘(B) 2002 MODEL YEAR CITY FUEL ECON-
OMY.—For purposes of subparagraph (A), the
2002 model year city fuel economy with respect
to a vehicle shall be determined on a gasoline
gallon equivalent basis as determined by the Ad-
ministrator of the Environmental Protection
Agency using the tables provided in subsection
(b)(2)(B) with respect to such vehicle.
‘‘(3) CREDIT
AMOUNT
FOR
HEAVIER
VEHI-
CLES.—
‘‘(A) IN GENERAL.—In the case of a new
qualified hybrid motor vehicle which is a heavy
duty hybrid motor vehicle, the credit amount de-
termined under this paragraph is an amount
equal to the applicable percentage of the incre-
mental cost of such vehicle placed in service by
the taxpayer during the taxable year.
‘‘(B) INCREMENTAL COST.—For purposes of
this paragraph, the incremental cost of any
heavy duty hybrid motor vehicle is equal to the
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HR 6 EAS
amount of the excess of the manufacturer’s sug-
gested retail price for such vehicle over such price
for a comparable gasoline or diesel fuel motor ve-
hicle of the same model, to the extent such
amount does not exceed—
‘‘(i) $7,500, if such vehicle has a gross
vehicle weight rating of more than 8,500
pounds but not more than 14,000 pounds,
‘‘(ii) $15,000, if such vehicle has a
gross vehicle weight rating of more than
14,000 pounds but not more than 26,000
pounds, and
‘‘(iii) $30,000, if such vehicle has a
gross vehicle weight rating of more than
26,000 pounds.
‘‘(C) APPLICABLE PERCENTAGE.—For pur-
poses of subparagraph (A), the applicable per-
centage shall be determined in accordance with
the following table:
‘‘If percent increase in fuel
economy of hybrid over
comparable vehicle is:
The applicable percentage is:
At least 30 but less than 40 percent
20 percent.
At least 40 but less than 50 percent
30 percent.
At least 50 percent ...........................
40 percent.
‘‘(4) NEW
QUALIFIED
HYBRID
MOTOR
VEHI-
CLE.—For purposes of this subsection—
‘‘(A) IN GENERAL.—The term ‘new qualified
hybrid motor vehicle’ means a motor vehicle—
†
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HR 6 EAS
‘‘(i) which draws propulsion energy
from onboard sources of stored energy which
are both—
‘‘(I) an internal combustion or
heat engine using consumable fuel, and
‘‘(II) a rechargeable energy stor-
age system,
‘‘(ii) which, in the case of a passenger
automobile, medium duty passenger vehicle,
or light truck—
‘‘(I) has received a certificate that
such vehicle meets or exceeds the Bin 5
Tier II emission level established in
regulations prescribed by the Adminis-
trator of the Environmental Protection
Agency under section 202(i) of the
Clean Air Act for that make and model
year vehicle, and
‘‘(II) has a maximum available
power of at least 5 percent,
‘‘(iii) which, in the case of a heavy
duty hybrid motor vehicle—
‘‘(I) which has a gross vehicle
weight rating of more than 8,500 but
not more than 14,000 pounds, has a
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HR 6 EAS
maximum available power of at least
10 percent, and
‘‘(II) which has a gross vehicle
weight rating of more than 14,000
pounds, has a maximum available
power of at least 15 percent,
‘‘(iv) the original use of which com-
mences with the taxpayer,
‘‘(v) which is acquired for use or lease
by the taxpayer and not for resale, and
‘‘(vi) which is made by a manufac-
turer.
‘‘(B) CONSUMABLE FUEL.—For purposes of
subparagraph (A)(i)(I), the term ‘consumable
fuel’ means any solid, liquid, or gaseous matter
which releases energy when consumed by an aux-
iliary power unit.
‘‘(C) MAXIMUM AVAILABLE POWER.—
‘‘(i) PASSENGER AUTOMOBILE, MEDIUM
DUTY
PASSENGER
VEHICLE, 
OR
LIGHT
TRUCK.—For purposes of subparagraph
(A)(ii)(II), the term ‘maximum available
power’ means the maximum power avail-
able from the rechargeable energy storage
system, during a standard 10 second pulse
†
1101
HR 6 EAS
power or equivalent test, divided by such
maximum power and the SAE net power of
the heat engine.
‘‘(ii) HEAVY DUTY HYBRID MOTOR VE-
HICLE.—For purposes of subparagraph
(A)(iii), the term ‘maximum available
power’ means the maximum power avail-
able from the rechargeable energy storage
system, during a standard 10 second pulse
power or equivalent test, divided by the ve-
hicle’s total traction power. The term ‘total
traction power’ means the sum of the peak
power from the rechargeable energy storage
system and the heat engine peak power of
the vehicle, except that if such storage sys-
tem is the sole means by which the vehicle
can be driven, the total traction power is
the peak power of such storage system.
‘‘(4) HEAVY DUTY HYBRID MOTOR VEHICLE.—
For purposes of this subsection, the term ‘heavy duty
hybrid motor vehicle’ means a new qualified hybrid
motor vehicle which has a gross vehicle weight rating
of more than 8,500 pounds. Such term does not in-
clude a medium duty passenger vehicle.
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‘‘(d) NEW QUALIFIED ALTERNATIVE FUEL MOTOR VE-
HICLE CREDIT.—
‘‘(1) ALLOWANCE OF CREDIT.—Except as pro-
vided in paragraph (5), the new qualified alternative
fuel motor vehicle credit determined under this sub-
section is an amount equal to the applicable percent-
age of the incremental cost of any new qualified alter-
native fuel motor vehicle placed in service by the tax-
payer during the taxable year.
‘‘(2) APPLICABLE
PERCENTAGE.—For purposes
of paragraph (1), the applicable percentage with re-
spect to any new qualified alternative fuel motor vehi-
cle is—
‘‘(A) 50 percent, plus
‘‘(B) 30 percent, if such vehicle—
‘‘(i) has received a certificate of con-
formity under the Clean Air Act and meets
or exceeds the most stringent standard
available for certification under the Clean
Air Act for that make and model year vehi-
cle (other than a zero emission standard), or
‘‘(ii) has received an order certifying
the vehicle as meeting the same require-
ments as vehicles which may be sold or
leased in California and meets or exceeds
†
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HR 6 EAS
the most stringent standard available for
certification under the State laws of Cali-
fornia (enacted in accordance with a waiver
granted under section 209(b) of the Clean
Air Act) for that make and model year vehi-
cle (other than a zero emission standard).
For purposes of the preceding sentence, in the case of
any new qualified alternative fuel motor vehicle
which weighs more than 14,000 pounds gross vehicle
weight rating, the most stringent standard available
shall be such standard available for certification on
the date of the enactment of the Energy Tax Incen-
tives Act.
‘‘(3) INCREMENTAL COST.—For purposes of this
subsection, the incremental cost of any new qualified
alternative fuel motor vehicle is equal to the amount
of the excess of the manufacturer’s suggested retail
price for such vehicle over such price for a gasoline
or diesel fuel motor vehicle of the same model, to the
extent such amount does not exceed—
‘‘(A) $5,000, if such vehicle has a gross ve-
hicle weight rating of not more than 8,500
pounds,
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HR 6 EAS
‘‘(B) $10,000, if such vehicle has a gross ve-
hicle weight rating of more than 8,500 pounds
but not more than 14,000 pounds,
‘‘(C) $25,000, if such vehicle has a gross ve-
hicle weight rating of more than 14,000 pounds
but not more than 26,000 pounds, and
‘‘(D) $40,000, if such vehicle has a gross ve-
hicle weight rating of more than 26,000 pounds.
‘‘(4) NEW QUALIFIED ALTERNATIVE FUEL MOTOR
VEHICLE.—For purposes of this subsection—
‘‘(A) IN GENERAL.—The term ‘new qualified
alternative fuel motor vehicle’ means any motor
vehicle—
‘‘(i) which is only capable of operating
on an alternative fuel,
‘‘(ii) the original use of which com-
mences with the taxpayer,
‘‘(iii) which is acquired by the tax-
payer for use or lease, but not for resale,
and
‘‘(iv) which is made by a manufac-
turer.
‘‘(B) ALTERNATIVE FUEL.—The term ‘alter-
native fuel’ means compressed natural gas, lique-
fied natural gas, liquefied petroleum gas, hydro-
†
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HR 6 EAS
gen, and any liquid at least 85 percent of the
volume of which consists of methanol.
‘‘(5) CREDIT FOR MIXED-FUEL VEHICLES.—
‘‘(A) IN GENERAL.—In the case of a mixed-
fuel vehicle placed in service by the taxpayer
during the taxable year, the credit determined
under this subsection is an amount equal to—
‘‘(i) in the case of a 75/25 mixed-fuel
vehicle, 70 percent of the credit which would
have been allowed under this subsection if
such vehicle was a qualified alternative fuel
motor vehicle, and
‘‘(ii) in the case of a 90/10 mixed-fuel
vehicle, 90 percent of the credit which would
have been allowed under this subsection if
such vehicle was a qualified alternative fuel
motor vehicle.
‘‘(B) MIXED-FUEL VEHICLE.—For purposes
of this subsection, the term ‘mixed-fuel vehicle’
means any motor vehicle described in subpara-
graph (C) or (D) of paragraph (3), which—
‘‘(i) is certified by the manufacturer as
being able to perform efficiently in normal
operation on a combination of an alter-
native fuel and a petroleum-based fuel,
†
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HR 6 EAS
‘‘(ii) either—
‘‘(I) has received a certificate of
conformity under the Clean Air Act, or
‘‘(II) has received an order certi-
fying the vehicle as meeting the same
requirements as vehicles which may be
sold or leased in California and meets
or exceeds the low emission vehicle
standard under section 88.105–94 of
title 40, Code of Federal Regulations,
for that make and model year vehicle,
‘‘(iii) the original use of which com-
mences with the taxpayer,
‘‘(iv) which is acquired by the tax-
payer for use or lease, but not for resale,
and
‘‘(v) which is made by a manufacturer.
‘‘(C) 75/25 
MIXED-FUEL
VEHICLE.—For
purposes of this subsection, the term ‘75/25
mixed-fuel vehicle’ means a mixed-fuel vehicle
which operates using at least 75 percent alter-
native fuel and not more than 25 percent petro-
leum-based fuel.
‘‘(D) 90/10 
MIXED-FUEL
VEHICLE.—For
purposes of this subsection, the term ‘90/10
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HR 6 EAS
mixed-fuel vehicle’ means a mixed-fuel vehicle
which operates using at least 90 percent alter-
native fuel and not more than 10 percent petro-
leum-based fuel.
‘‘(e) APPLICATION WITH OTHER CREDITS.—The credit
allowed under subsection (a) for any taxable year shall not
exceed the excess (if any) of—
‘‘(1) the regular tax for the taxable year reduced
by the sum of the credits allowable under subpart A
and sections 27, 29, and 30, over
‘‘(2) the tentative minimum tax for the taxable
year.
‘‘(f) OTHER DEFINITIONS AND SPECIAL RULES.—For
purposes of this section—
‘‘(1) MOTOR VEHICLE.—The term ‘motor vehicle’
has the meaning given such term by section 30(c)(2).
‘‘(2) CITY FUEL ECONOMY.—The city fuel econ-
omy with respect to any vehicle shall be measured in
a manner which is substantially similar to the man-
ner city fuel economy is measured in accordance with
procedures under part 600 of subchapter Q of chapter
I of title 40, Code of Federal Regulations, as in effect
on the date of the enactment of this section.
‘‘(3) OTHER
TERMS.—The terms ‘automobile’,
‘passenger automobile’, ‘medium duty passenger vehi-
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cle’, ‘light truck’, and ‘manufacturer’ have the mean-
ings given such terms in regulations prescribed by the
Administrator of the Environmental Protection Agen-
cy for purposes of the administration of title II of the
Clean Air Act (42 U.S.C. 7521 et seq.).
‘‘(4) REDUCTION IN BASIS.—For purposes of this
subtitle, the basis of any property for which a credit
is allowable under subsection (a) shall be reduced by
the amount of such credit so allowed (determined
without regard to subsection (e)).
‘‘(5) NO DOUBLE BENEFIT.—The amount of any
deduction or other credit allowable under this
chapter—
‘‘(A) for any incremental cost taken into ac-
count in computing the amount of the credit de-
termined under subsection (d) shall be reduced
by the amount of such credit attributable to such
cost, and
‘‘(B) with respect to a vehicle described
under subsection (b) or (c), shall be reduced by
the amount of credit allowed under subsection
(a) for such vehicle for the taxable year.
‘‘(6) PROPERTY USED BY TAX-EXEMPT ENTITY.—
In the case of a vehicle whose use is described in
paragraph (3) or (4) of section 50(b) and which is
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not subject to a lease, the person who sold such vehicle
to the person or entity using such vehicle shall be
treated as the taxpayer that placed such vehicle in
service, but only if such person clearly discloses to
such person or entity in a document the amount of
any credit allowable under subsection (a) with respect
to such vehicle (determined without regard to sub-
section (e)).
‘‘(7) PROPERTY USED OUTSIDE UNITED STATES,
ETC., NOT QUALIFIED.—No credit shall be allowable
under subsection (a) with respect to any property re-
ferred to in section 50(b)(1) or with respect to the
portion of the cost of any property taken into account
under section 179.
‘‘(8) RECAPTURE.—The Secretary shall, by regu-
lations, provide for recapturing the benefit of any
credit allowable under subsection (a) with respect to
any property which ceases to be property eligible for
such credit (including recapture in the case of a lease
period of less than the economic life of a vehicle).
‘‘(9) ELECTION TO NOT TAKE CREDIT.—No credit
shall be allowed under subsection (a) for any vehicle
if the taxpayer elects to not have this section apply
to such vehicle.
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‘‘(10) CARRYBACK
AND
CARRYFORWARD
AL-
LOWED.—
‘‘(A) IN GENERAL.—If the credit allowable
under subsection (a) for a taxable year exceeds
the amount of the limitation under subsection (e)
for such taxable year (in this paragraph referred
to as the ‘unused credit year’), such excess shall
be a credit carryback to each of the 3 taxable
years preceding the unused credit year and a
credit carryforward to each of the 20 taxable
years following the unused credit year, except
that no excess may be carried to a taxable year
beginning before the date of the enactment of this
section. The preceding sentence shall not apply to
any credit carryback if such credit carryback is
attributable to property for which a deduction
for depreciation is not allowable.
‘‘(B) RULES.—Rules similar to the rules of
section 39 shall apply with respect to the credit
carryback and credit carryforward under sub-
paragraph (A).
‘‘(11) INTERACTION
WITH
AIR
QUALITY
AND
MOTOR VEHICLE SAFETY STANDARDS.—Unless other-
wise provided in this section, a motor vehicle shall
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not be considered eligible for a credit under this sec-
tion unless such vehicle is in compliance with—
‘‘(A) the applicable provisions of the Clean
Air Act for the applicable make and model year
of the vehicle (or applicable air quality provi-
sions of State law in the case of a State which
has adopted such provision under a waiver
under section 209(b) of the Clean Air Act), and
‘‘(B) the motor vehicle safety provisions of
sections 30101 through 30169 of title 49, United
States Code.
‘‘(g) REGULATIONS.—
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), the Secretary shall promulgate such regula-
tions as necessary to carry out the provisions of this
section.
‘‘(2) COORDINATION IN PRESCRIPTION OF CER-
TAIN REGULATIONS.—The Secretary of the Treasury,
in coordination with the Secretary of Transportation
and the Administrator of the Environmental Protec-
tion Agency, shall prescribe such regulations as nec-
essary to determine whether a motor vehicle meets the
requirements to be eligible for a credit under this sec-
tion.
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‘‘(h) TERMINATION.—This section shall not apply to
any property purchased after—
‘‘(1) in the case of a new qualified fuel cell motor
vehicle (as described in subsection (b)), December 31,
2014,
‘‘(2) in the case of a new qualified hybrid motor
vehicle (as described in subsection (c)), December 31,
2009, and
‘‘(3) in the case of a new qualified alternative
fuel vehicle (as described in subsection (d)), December
31, 2010.’’.
(b) CONFORMING AMENDMENTS.—
(1) Section 1016(a), as amended by this Act, is
amended by striking ‘‘and’’ at the end of paragraph
(35), by striking the period at the end of paragraph
(36) and inserting ‘‘, and’’, and by adding at the end
the following new paragraph:
‘‘(37) 
to 
the 
extent 
provided 
in 
section
30B(f)(4).’’.
(2) Section 55(c)(2), as amended by this Act, is
amended by inserting ‘‘30B(e),’’ after ‘‘30(b)(2),’’.
(3) Section 6501(m) is amended by inserting
‘‘30B(f)(9),’’ after ‘‘30(d)(4),’’.
(4) The table of sections for subpart B of part IV
of subchapter A of chapter 1 is amended by inserting
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after the item relating to section 30A the following
new item:
‘‘Sec. 30B. Alternative motor vehicle credit.’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to property placed in service after the
date of the enactment of this Act, in taxable years ending
after such date.
SEC. 1532. MODIFICATION OF CREDIT FOR QUALIFIED
ELECTRIC VEHICLES.
(a) AMOUNT OF CREDIT.—
(1) IN GENERAL.—Section 30(a) (relating to al-
lowance of credit) is amended by striking ‘‘10 percent
of’’.
(2) LIMITATION OF CREDIT ACCORDING TO TYPE
OF VEHICLE.—Paragraph (1) of section 30(b) (relat-
ing to limitations) is amended to read as follows:
‘‘(1) LIMITATION ACCORDING TO TYPE OF VEHI-
CLE.—The amount of the credit allowed under sub-
section (a) for any vehicle shall not exceed the greatest
of the following amounts applicable to such vehicle:
‘‘(A) In the case of a vehicle with a gross
vehicle weight rating not exceeding 8,500
pounds—
‘‘(i) except as provided in clause (ii) or
(iii), $4,000,
‘‘(ii) $6,000, if such vehicle is—
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‘‘(I) capable of a driving range of
at least 100 miles on a single charge of
the vehicle’s rechargeable batteries as
measured pursuant to the urban dyna-
mometer schedules under appendix I to
part 86 of title 40, Code of Federal
Regulations, or
‘‘(II) capable of a payload capac-
ity of at least 1,000 pounds, and
‘‘(iii) if such vehicle is a low-speed ve-
hicle which conforms to Standard 500 pre-
scribed by the Secretary of Transportation
(49 C.F.R. 571.500), as in effect on the date
of the enactment of the Energy Tax Incen-
tives Act, the lesser of—
‘‘(I) 10 percent of the manufactur-
er’s suggested retail price of the vehicle,
or
‘‘(II) $1,500.
‘‘(B) In the case of a vehicle with a gross
vehicle weight rating exceeding 8,500 but not ex-
ceeding 14,000 pounds, $10,000.
‘‘(C) In the case of a vehicle with a gross
vehicle weight rating exceeding 14,000 but not
exceeding 26,000 pounds, $20,000.
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‘‘(D) In the case of a vehicle with a gross
vehicle weight rating exceeding 26,000 pounds,
$40,000.’’.
(b) QUALIFIED BATTERY ELECTRIC VEHICLE.—
(1) IN GENERAL.—Section 30(c)(1)(A) (defining
qualified electric vehicle) is amended to read as fol-
lows:
‘‘(A) which is—
‘‘(i) operated solely by use of a battery
or battery pack, or
‘‘(ii) powered primarily through the
use of an electric battery or battery pack
using a flywheel or capacitor which stores
energy produced by an electric motor
through regenerative braking to assist in ve-
hicle operation,’’.
(2) LEASED VEHICLES.—Section 30(c)(1)(C) is
amended by inserting ‘‘or lease’’ after ‘‘use’’.
(3) CONFORMING AMENDMENTS.—
(A) Subsections (a), (b)(2), and (c) of sec-
tion 30 are each amended by inserting ‘‘battery’’
after ‘‘qualified’’ each place it appears.
(B) The heading of subsection (c) of section
30 is amended by inserting ‘‘BATTERY’’ after
‘‘QUALIFIED’’.
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(C) The heading of section 30 is amended
by inserting ‘‘BATTERY’’ after ‘‘QUALIFIED’’.
(D) The item relating to section 30 in the
table of sections for subpart B of part IV of sub-
chapter A of chapter 1 is amended by inserting
‘‘battery’’ after ‘‘qualified’’.
(E) Section 179A(c)(3) is amended by in-
serting ‘‘battery’’ before ‘‘electric’’.
(F) The heading of paragraph (3) of section
179A(c) is amended by inserting ‘‘BATTERY’’ be-
fore ‘‘ELECTRIC’’.
(c) ADDITIONAL SPECIAL RULES.—
(1) IN GENERAL.—Section 30(d) (relating to spe-
cial rules) is amended by adding at the end the fol-
lowing new paragraphs:
‘‘(5) NO DOUBLE BENEFIT.—The amount of any
deduction or other credit allowable under this chapter
for any cost taken into account in computing the
amount of the credit determined under subsection (a)
shall be reduced by the amount of such credit attrib-
utable to such cost.
‘‘(6) PROPERTY USED BY TAX-EXEMPT ENTITY.—
In the case of a vehicle whose use is described in
paragraph (3) or (4) of section 50(b) and which is
not subject to a lease, the person who sold such vehicle
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to the person or entity using such vehicle shall be
treated as the taxpayer that placed such vehicle in
service, but only if such person clearly discloses to
such person or entity in a document the amount of
any credit allowable under subsection (a) with respect
to such vehicle (determined without regard to sub-
section (b)(3)).
‘‘(7) 
CARRYBACK
AND
CARRYFORWARD
AL-
LOWED.—
‘‘(A) IN GENERAL.—If the credit allowable
under subsection (a) for a taxable year exceeds
the amount of the limitation under subsection
(b)(2) for such taxable year (in this paragraph
referred to as the ‘unused credit year’), such ex-
cess shall be a credit carryback to each of the 3
taxable years preceding the unused credit year
and a credit carryforward to each of the 20 tax-
able years following the unused credit year, ex-
cept that no excess may be carried to a taxable
year beginning before the date of the enactment
of this paragraph. The preceding sentence shall
not apply to any credit carryback if such credit
carryback is attributable to property for which a
deduction for depreciation is not allowable.
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‘‘(B) RULES.—Rules similar to the rules of
section 39 shall apply with respect to the credit
carryback and credit carryforward under sub-
paragraph (A).’’.
(2) 
CONFORMING
AMENDMENTS.—Section
30(d)(3) is amended—
(A) by striking ‘‘section 50(b)’’ and insert-
ing ‘‘section 50(b)(1)’’, and
(B) by striking ‘‘, ETC.,’’ in the heading
thereof.
(d) TERMINATION.—Section 30(e) (relating to termi-
nation) is amended by striking ‘‘2006’’ and inserting
‘‘2009’’.
(d) EFFECTIVE DATE.—The amendments made by this
section shall apply to property placed in service after the
date of the enactment of this Act, in taxable years ending
after such date.
SEC. 1533. CREDIT FOR INSTALLATION OF ALTERNATIVE
FUELING STATIONS.
(a) IN GENERAL.—Subpart B of part IV of subchapter
A of chapter 1 (relating to other credits), as amended by
this Act, is amended by adding at the end the following
new section:
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‘‘SEC. 30C. ALTERNATIVE FUEL VEHICLE REFUELING PROP-
ERTY CREDIT.
‘‘(a) CREDIT ALLOWED.—There shall be allowed as a
credit against the tax imposed by this chapter for the tax-
able year an amount equal to 50 percent of the cost of any
qualified alternative fuel vehicle refueling property placed
in service by the taxpayer during the taxable year.
‘‘(b) LIMITATION.—The credit allowed under sub-
section (a) with respect to any alternative fuel vehicle re-
fueling property shall not exceed—
‘‘(1) $30,000 in the case of a property of a char-
acter subject to an allowance for depreciation, and
‘‘(2) $1,000 in any other case.
‘‘(c) QUALIFIED ALTERNATIVE FUEL VEHICLE RE-
FUELING PROPERTY.—
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), the term ‘qualified alternative fuel vehicle
refueling property’ has the meaning given to such
term by section 179A(d), but only with respect to any
fuel at least 85 percent of the volume of which consists
of ethanol, natural gas, compressed natural gas, lique-
fied natural gas, liquefied petroleum gas, and hydro-
gen or any mixture of biodiesel (as defined in section
40A(d)(1)) and diesel fuel (as defined in section
4083(a)(3)), determined without regard to any use of
kerosene and containing at least 20 percent biodiesel.