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‘‘(i) animal wastes, including poultry 
fats and poultry wastes, and other waste 
materials; or 
‘‘(ii) 
municipal 
solid 
waste 
and 
sludges and oils derived from wastewater 
and the treatment of wastewater; and’’.’’ 
Subtitle D—Insular Energy 
SEC. 241. DEFINITIONS. 
In this subtitle: 
(1) DISTRIBUTED GENERATION.—The term ‘‘dis-
tributed generation’’ means energy supplied in a 
rural or off-grid area. 
(2) INSULAR AREA.—The term ‘‘insular area’’ 
means— 
(A) Guam; 
(B) American Samoa; 
(C) the Commonwealth of the Northern 
Mariana Islands; 
(D) the Federated States of Micronesia; 
(E) the Republic of the Marshall Islands; 
(F) the Republic of Palau; 
(G) the United States Virgin Islands; and 
(H) the Commonwealth of Puerto Rico.
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SEC. 242. ASSESSMENT. 
(a) IN GENERAL.—Not later than 1 year after the date 
of enactment of this Act, the Secretary (in consultation with 
the Secretary of Interior) shall— 
(1) conduct an assessment of the energy needs of 
insular areas; and 
(2) submit a report describing the results of the 
assessment to— 
(A) the Committee on Energy and Natural 
Resources of the Senate; 
(B) the Committee on Energy and Com-
merce of the House of Representatives; and 
(C) the Committee on Resources of the 
House of Representatives. 
(b) STRATEGIES AND PROJECTS.—In conducting the 
assessment, for each of the insular areas, the Secretary shall 
identify and evaluate the strategies or projects with the 
greatest potential for reducing the dependence of the insular 
area on imported fossil fuels as used for the generation of 
electricity, including strategies and projects for— 
(1) improved supply-side efficiency of centralized 
electrical generation, transmission, and distribution 
systems; 
(2) 
improved 
demand-side 
management 
through—
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(A) the application of established standards 
for energy efficiency for appliances; 
(B) the conduct of energy audits for busi-
ness and industrial customers; and 
(C) the use of energy savings performance 
contracts; 
(3) increased use of renewable energy, includ-
ing— 
(A) solar thermal energy for electric genera-
tion; 
(B) solar thermal energy for water heating 
in large buildings, such as hotels, hospitals, gov-
ernment buildings, and residences; 
(C) photovoltaic energy; 
(D) wind energy; 
(E) hydroelectric energy; 
(F) wave energy; 
(G) energy from ocean thermal resources, 
including ocean thermal-cooling for community 
air conditioning; 
(H) water vapor condensation for the pro-
duction of potable water; 
(I) fossil fuel and renewable hybrid elec-
trical generation systems; and
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(J) other strategies or projects that the Sec-
retary may identify as having significant poten-
tial; and 
(4) fuel substitution and minimization with in-
digenous biofuels, such as coconut oil. 
(c) DISTRIBUTED GENERATION.—In conducting the 
assessment, for each insular area with a significant need 
for distributed generation, the Secretary shall identify and 
evaluate the most promising strategies and projects de-
scribed in paragraphs (3) and (4) of subsection (b) for meet-
ing that need. 
(d) FACTORS.—In assessing the potential of any strat-
egy or project under this section, the Secretary shall con-
sider— 
(1) the estimated cost of the power or energy to 
be produced, including— 
(A) any additional costs associated with the 
distribution of the generation; and 
(B) the long-term availability of the genera-
tion source; 
(2) the capacity of the local electrical utility to 
manage, operate, and maintain any project that may 
be undertaken; and 
(3) other factors the Secretary considers to be ap-
propriate.
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SEC. 243. PROJECT FEASIBILITY STUDIES. 
(a) IN GENERAL.—On a request described in sub-
section (b), the Secretary shall conduct a feasibility study 
of a project to implement a strategy or project identified 
under section 222 as having the potential to— 
(1) significantly reduce the dependence of an in-
sular area on imported oil; or 
(2) provide needed distributed generation to an 
insular area. 
(b) REQUEST.—The Secretary shall conduct a feasi-
bility study under subsection (a) on— 
(1) the request of an electric utility located in an 
insular area that commits to fund at least 10 percent 
of the cost of the study; and 
(2) if the electric utility is located in the Fed-
erated States of Micronesia, the Republic of the Mar-
shall Islands, or the Republic of Palau, written sup-
port for that request by the President or the Ambas-
sador of the affected freely associated state. 
(c) CONSULTATION.—The Secretary shall consult with 
regional utility organizations in— 
(1) conducting feasibility studies under sub-
section (a); and 
(2) determining the feasibility of potential 
projects.
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(d) FEASIBILITY.—For the purpose of a feasibility 
study under subsection (a), a project shall be determined 
to be feasible if the project would significantly reduce the 
dependence of an insular area on imported fossil fuels, or 
provide needed distributed generation to an insular area, 
at a reasonable cost. 
SEC. 244. IMPLEMENTATION. 
(a) IN GENERAL.—On a determination by the Sec-
retary (in consultation with the Secretary of the Interior) 
that a project is feasible under section 223 and a commit-
ment by an electric utility to operate and maintain the 
project, the Secretary may provide such technical and fi-
nancial assistance as the Secretary determines is appro-
priate for the implementation of the project. 
(b) REGIONAL UTILITY ORGANIZATIONS.—In pro-
viding assistance under subsection (a), the Secretary shall 
consider providing the assistance through regional utility 
organizations. 
SEC. 245. AUTHORIZATION OF APPROPRIATIONS. 
(a) IN GENERAL.—There are authorized to be appro-
priated to the Secretary— 
(1) $500,000 for the completion of the assessment 
under section 222; 
(2) $500,000 for each fiscal year for project feasi-
bility studies under section 223; and
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(3) $5,000,000 for each fiscal year for project 
implementation under section 224. 
(b) LIMITATION OF FUNDS RECEIVED BY INSULAR 
AREAS.—No insular area may receive, during any 3-year 
period, more than 20 percent of the total funds made avail-
able during that 3-year period under paragraphs (2) and 
(3) of subsection (a) unless the Secretary determines that 
providing funding in excess of that percentage best advances 
existing opportunities to meet the objectives of this subtitle. 
Subtitle E—Biomass Energy 
SEC. 251. DEFINITIONS. 
In this subtitle: 
(1) BIOMASS.—The term ‘‘biomass’’ means non-
merchantable 
material 
from, 
or 
precommercial 
thinnings of, trees and woody plants produced from 
treatments— 
(A) to reduce hazardous fuels; 
(B) to reduce or contain disease or insect 
infestations; or 
(C) to restore forest health. 
(2) ELIGIBLE COMMUNITY.—The term ‘‘eligible 
community’’ means an Indian Reservation, or a 
county, town, township, municipality, or other simi-
lar unit of local government with a population of not 
more than 50,000 individuals that the Secretary de-
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termines is located in an area near Federal or Indian 
land, that is— 
(A) at significant risk of catastrophic wild-
fire, disease, or insect infestation; or 
(B) diseased or infested by insects. 
(3) ELIGIBLE
OPERATION.—The term ‘‘eligible 
operation’’ means a facility that— 
(A) is located within the boundaries of an 
eligible community; and 
(B) uses biomass from Federal or Indian 
land as a raw material to produce electric en-
ergy, sensible heat, or transportation fuels. 
(4) GREEN TON.—The term ‘‘green ton’’ means 
2,000 pounds of biomass that has not been mechani-
cally or artificially dried. 
(5) INDIAN TRIBE.—The term ‘‘Indian tribe’’ has 
the meaning given the term in section 4(e) of the In-
dian Self-Determination and Education Assistance 
Act (25 U.S.C. 450b(e)). 
(6) PERSON.—The term ‘‘person’’ includes— 
(A) an individual; 
(B) an eligible community; 
(C) an Indian tribe; 
(D) a small business or a corporation that 
is incorporated in the United States; and
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(E) a nonprofit organization. 
(7) 
SECRETARY.—The 
term 
‘‘Secretary’’ 
means— 
(A) the Secretary of Agriculture, with re-
spect to land within the National Forest System; 
or 
(B) the Secretary of the Interior, with re-
spect to Federal land under the jurisdiction of 
the Secretary of the Interior and Indian land. 
SEC. 252. BIOMASS COMMERCIAL UTILIZATION GRANT PRO-
GRAM. 
(a) IN GENERAL.—The Secretary may make grants to 
any person that owns or operates an eligible operation to 
offset the costs incurred to purchase biomass for use by the 
eligible operation. 
(b) PRIORITY.—In making grants under subsection 
(a), the Secretary shall give priority to eligible operations 
that use biomass from the highest risk areas, as determined 
by the Secretary. 
(c) GRANT AMOUNT.—A grant provided under this sec-
tion may not exceed $20 per green ton of biomass delivered. 
(d) MONITORING OF GRANT RECIPIENT ACTIVITIES.— 
(1) IN GENERAL.—As a condition of a grant 
under this section, the grant recipient shall keep such 
records as the Secretary may require to fully and cor-
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rectly disclose the use of the grant funds and all 
transactions involved in the purchase of biomass. 
(2) ACCESS.—On notice by the Secretary, the 
grant recipient shall provide the Secretary reasonable 
access to examine the inventory and records of the eli-
gible operation. 
(e) AUTHORIZATION OF APPROPRIATIONS.— 
(1) IN GENERAL.—There are authorized to be ap-
propriated to carry out this section for each of fiscal 
years 2006 through 2010— 
(A) $12,500,000 to the Secretary of Agri-
culture; and 
(B) $12,500,000 to the Secretary of the Inte-
rior. 
(2) AVAILABILITY.—Amounts made available 
under paragraph (1) shall remain available until ex-
pended. 
SEC. 253. IMPROVED BIOMASS UTILIZATION PROGRAM. 
(a) IN GENERAL.—The Secretary may provide grants 
to persons in eligible communities to offset the costs of devel-
oping or researching proposals to improve the use of bio-
mass or add value to biomass utilization. 
(b) SELECTION.—Grant recipients shall be selected 
based on the potential of a proposal to—
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(1) develop affordable thermal or electric energy 
resources for the benefit of an eligible community; 
(2) provide opportunities for the creation or ex-
pansion of small business concerns within an eligible 
community; 
(3) create new job opportunities within an eligi-
ble community; 
(4) improve efficiency or develop cleaner tech-
nologies for biomass utilization; and 
(5) reduce the hazardous fuel from the highest 
risk areas. 
(c) LIMITATION.—No grant provided under this section 
shall exceed $500,000. 
(d) AUTHORIZATION OF APPROPRIATIONS.— 
(1) IN GENERAL.—There are authorized to be ap-
propriated to carry out this section for each of fiscal 
years 2006 through 2010— 
(A) $12,500,000 to the Secretary of Agri-
culture; and 
(B) $12,500,000 to the Secretary of the Inte-
rior. 
(2) AVAILABILITY.—Amounts made available 
under paragraph (1) shall remain available until ex-
pended.
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SEC. 254. REPORT. 
Not later than 3 years after the date of enactment of 
this Act, the Secretary of Agriculture and the Secretary of 
the Interior shall jointly submit to Congress a report that 
describes the interim results of the programs carried out 
under sections 232 and 233. 
Subtitle F—Geothermal Energy 
SEC. 261. COMPETITIVE LEASE SALE REQUIREMENTS. 
Section 4 of the Geothermal Steam Act of 1970 (30 
U.S.C. 1003) is amended to read as follows: 
‘‘SEC. 4. LEASING PROCEDURES. 
‘‘(a) NOMINATIONS.—The Secretary shall accept nomi-
nations of land to be leased at any time from qualified com-
panies and individuals under this Act. 
‘‘(b) COMPETITIVE LEASE SALE REQUIRED.— 
‘‘(1) IN GENERAL.—Except as otherwise specifi-
cally provided by this Act, all land to be leased that 
is not subject to leasing under subsection (c) shall be 
leased as provided in this subsection to the highest re-
sponsible qualified bidder, as determined by the Sec-
retary. 
‘‘(2) COMPETITIVE LEASE SALES.—The Secretary 
shall hold a competitive lease sale at least once every 
2 years for land in a State that has nominations 
pending under subsection (a) if the land is otherwise 
available for leasing.
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‘‘(c) NONCOMPETITIVE LEASING.—The Secretary shall 
make available for a period of 2 years for noncompetitive 
leasing any tract for which a competitive lease sale is held, 
but for which the Secretary does not receive any bids in 
a competitive lease sale. 
‘‘(d) PENDING LEASE APPLICATIONS.— 
‘‘(1) IN GENERAL.—It shall be a priority for the 
Secretary, and for the Secretary of Agriculture with 
respect to National Forest Systems land, to ensure 
timely completion of administrative actions necessary 
to process applications for geothermal leasing pending 
on May 19, 2005. 
‘‘(2) 
ADMINISTRATION.—An 
application 
de-
scribed in paragraph (1) and any lease issued pursu-
ant to the application— 
‘‘(A) except as provided in subparagraph 
(B), shall be subject to this section as in effect on 
the day before the date of enactment of this para-
graph; or 
‘‘(B) at the election of the applicant, shall 
be subject to this section as in effect on the effec-
tive date of this paragraph.’’. 
SEC. 262. DIRECT USE. 
(a) FEES FOR DIRECT USE.—Section 5 of the Geo-
thermal Steam Act of 1970 (30 U.S.C. 1004) is amended—
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(1) in subsection (c), by redesignating para-
graphs (1) and (2) as subparagraphs (A) and (B), re-
spectively; 
(2) by redesignating subsections (a) through (d) 
as paragraphs (1) through (4), respectively; 
(3) by inserting ‘‘(a) IN GENERAL.—’’ after 
‘‘SEC. 5.’’; and 
(4) by adding at the end the following: 
‘‘(d) DIRECT USE.— 
‘‘(1) IN GENERAL.—Notwithstanding subsection 
(a)(1), the Secretary shall establish a schedule of fees, 
in lieu of royalties for geothermal resources, that a 
lessee or its affiliate— 
‘‘(A) uses for a purpose other than the com-
mercial generation of electricity; and 
‘‘(B) does not sell. 
‘‘(2) SCHEDULE
OF
FEES.—The schedule of 
fees— 
‘‘(A) may be based on the quantity or ther-
mal content, or both, of geothermal resources 
used or any other basis that the Secretary finds 
appropriate under the circumstances; and 
‘‘(B) shall ensure a fair return to the 
United States for use of the resource.
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‘‘(3) STATE
OR
LOCAL
GOVERNMENTS.—If a 
State or local government is the lessee and uses geo-
thermal resources without sale and for purposes other 
than commercial generation of electricity, the Sec-
retary shall charge only a nominal fee for use of the 
resource.’’. 
(b) LEASING FOR DIRECT USE.—Section 4 of the Geo-
thermal Steam Act of 1970 (30 U.S.C. 1003) (as amended 
by section 241) is amended adding at the end the following: 
‘‘(e) LEASING FOR DIRECT USE OF GEOTHERMAL RE-
SOURCES.—Notwithstanding subsection (b), the Secretary 
may identify areas in which the land to be leased under 
this Act exclusively for direct use of geothermal resources 
without sale for purposes other than commercial generation 
of electricity may be leased to any qualified applicant that 
first applies for such a lease under regulations issued by 
the Secretary, if the Secretary— 
‘‘(1) publishes a notice of the land proposed for 
leasing not later than 120 days before the date of the 
issuance of the lease; 
‘‘(2) does not receive during the 120-day period 
beginning on the date of the publication any nomina-
tion to include the land concerned in the next com-
petitive lease sale; and