741 
‘‘SEC. 792. AUCTIONING ALLOWANCES FOR OTHER ENTI-
TIES. 
‘‘(a) CONSIGNMENT.—Any entity holding emission al-
lowances or compensatory allowances may request that the 
Administrator auction, pursuant to section 791, the allow-
ances on consignment. 
‘‘(b) PRICING.—When the Administrator acts under 
this section as the agent of an entity in possession of emis-
sion allowances, the Administrator is not obligated to ob-
tain the highest price possible for the emission allowances, 
and instead shall auction consignment allowances in the 
same manner and pursuant to the same rules as auctions 
of other allowances under section 791. The Administrator 
may permit the entity offering the allowance for sale to con-
dition the sale of its allowances pursuant to this section 
on a minimum reserve price that is different than the re-
serve auction price set pursuant to section 791(d). 
‘‘(c) PROCEEDS.—For emission allowances and com-
pensatory allowances auctioned pursuant to this section, 
notwithstanding section 3302 of title 31, United States 
Code, or any other provision of law, within 90 days of re-
ceipt, the United States shall transfer the proceeds from the 
auction to the entity which held the allowances auctioned. 
No funds transferred from a purchaser to a seller of emis-
sion allowances or compensatory allowances under this sub-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00741
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
742 
section shall be held by any officer or employee of the United 
States or treated for any purpose as public monies. 
‘‘(d) REGULATIONS.—The Administrator shall issue 
regulations within 24 months after the date of enactment 
of this title to implement this section. 
‘‘SEC. 793. ESTABLISHMENT OF FUNDS. 
‘‘There is established in the Treasury of the United 
States the following funds: 
‘‘(1) The Strategic Reserve Fund. 
‘‘(2) The Climate Change Consumer Refund 
Fund. 
‘‘SEC. 794. OVERSIGHT OF ALLOCATIONS. 
‘‘(a) IN GENERAL.—Not later than January 1, 2014, 
and every 2 years thereafter, the Comptroller General of the 
United States shall carry out a review of programs admin-
istered by the Federal Government that distribute emission 
allowances or funds from any Federal auction of allow-
ances. 
‘‘(b) CONTENTS.—Each such report shall include a 
comprehensive evaluation of the administration and effec-
tiveness of each program, including— 
‘‘(1) the efficiency, transparency, and soundness 
of the administration of each program; 
‘‘(2) the performance of activities receiving as-
sistance under each program; 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00742
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
743 
‘‘(3) the cost-effectiveness of each program in 
achieving the stated purposes of the program; and 
‘‘(4) recommendations, if any, for regulatory or 
administrative changes to each program to improve 
its effectiveness. 
‘‘(c) FOCUS.—In evaluating program performance, 
each review under this section review shall address the effec-
tiveness of such programs in— 
‘‘(1) creating and preserving jobs; 
‘‘(2) ensuring a manageable transition for work-
ing families and workers; 
‘‘(3) reducing the emissions, or enhancing seques-
tration, of greenhouse gases; 
‘‘(4) developing clean technologies; and 
‘‘(5) building resilience to the impacts of climate 
change.’’. 
Subtitle C—Additional Greenhouse 
Gas Standards 
SEC. 331. GREENHOUSE GAS STANDARDS. 
The Clean Air Act (42 U.S.C. 7401 and following), 
as amended by subtitles A and B of this title, is further 
amended by adding the following new title after title VII: 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00743
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
744 
‘‘TITLE VIII—ADDITIONAL 
GREENHOUSE GAS STANDARDS 
‘‘SEC. 801. DEFINITIONS. 
‘‘For purposes of this title, terms that are defined in 
title VII, except for the term ‘stationary source’, shall have 
the meaning given those terms in title VII. 
‘‘PART A—STATIONARY SOURCE STANDARDS 
‘‘SEC. 811. STANDARDS OF PERFORMANCE. 
‘‘(a) UNCAPPED STATIONARY SOURCES.— 
‘‘(1) INVENTORY OF SOURCE CATEGORIES.—(A) 
Within 12 months after the date of enactment of this 
title, the Administrator shall publish under section 
111(b)(1)(A) an inventory of categories of stationary 
sources that consist of those categories that contain 
sources that individually had uncapped greenhouse 
gas emissions greater than 10,000 tons of carbon diox-
ide equivalent and that, in the aggregate, were re-
sponsible for emitting at least 20 percent annually of 
the uncapped greenhouse gas emissions. 
‘‘(B) The Administrator shall include in the in-
ventory under this paragraph each source category 
that is responsible for at least 10 percent of the un-
capped methane emissions in 2005. Notwithstanding 
any other provision, the inventory required by this 
section shall not include sources of enteric fermenta-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00744
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
745 
tion. The list under this paragraph shall include in-
dustrial sources, the emissions from which, when 
added to the capped emissions from industrial 
sources, constitute at least 95 percent of the green-
house gas emissions of the industrial sector. 
‘‘(C) For purposes of this subsection, emissions 
shall be calculated using tons of carbon dioxide 
equivalents. In promulgating the inventory required 
by this paragraph and the schedule required under by 
paragraph (2)(C), the Administrator shall use the 
most current emissions data available at the time of 
promulgation, except as provided in subparagraph 
(B). 
‘‘(D) Notwithstanding any other provisions, the 
Administrator may list under 111(b) any source cat-
egory identified in the inventory required by this sub-
section without making a finding that the source cat-
egory causes or contributes significantly to, air pollu-
tion with may be reasonably anticipated to endanger 
public health or welfare. 
‘‘(2) STANDARDS AND SCHEDULE.—(A) For each 
category identified as provided in paragraph (1), the 
Administrator shall promulgate standards of perform-
ance under section 111 for the uncapped emissions of 
greenhouse gases from stationary sources in that cat-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00745
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
746 
egory and shall promulgate corresponding regulations 
under section 111(d). 
‘‘(B) The Administrator shall promulgate stand-
ards as required by this subsection for stationary 
sources in categories identified as provided in para-
graph (1) as expeditiously as practicable, assuring 
that— 
‘‘(i) standards for identified source cat-
egories that, combined, emitted 80 percent or 
more of the greenhouse gas emissions of the iden-
tified source categories shall be promulgated not 
later than 3 years after the date of enactment of 
this title and shall include standards for natural 
gas extraction; and 
‘‘(ii) for all other identified source cat-
egories— 
‘‘(I) standards for not less than an ad-
ditional 25 percent of the identified cat-
egories shall be promulgated not later than 
5 years after the date of enactment of this 
title; 
‘‘(II) standards for not less than an 
additional 25 percent of the identified cat-
egories shall be promulgated not later than 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00746
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
747 
7 years after the date of enactment of this 
title; and 
‘‘(III) standards for all the identified 
categories shall be promulgated not later 
than 10 years after the date of enactment of 
this title. 
‘‘(C) Not later than 24 months after the date of 
enactment of this title and after notice and oppor-
tunity for comment, the Administrator shall publish 
a schedule establishing a date for the promulgation of 
standards for each category of sources identified pur-
suant to paragraph (1). The date for each category 
shall be consistent with the requirements of subpara-
graph (B). The determination of priorities for the 
promulgation of standards pursuant to this para-
graph is not a rulemaking and shall not be subject to 
judicial review, except that failure to promulgate any 
standard pursuant to the schedule established by this 
paragraph shall be subject to review under section 
304(a)(2). 
‘‘(D) Notwithstanding section 307, no action of 
the Administrator listing a source category under 
paragraph (1) shall be a final agency action subject 
to judicial review, except that any such action may 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00747
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
748 
be reviewed under section 307 when the Adminis-
trator issues performance standards for such category. 
‘‘(b) CAPPED SOURCES.—No standard of performance 
shall be established under section 111 for capped greenhouse 
gas emissions from a capped source unless the Adminis-
trator determines that such standards are appropriate be-
cause of effects that do not include climate change effects. 
In promulgating a standard of performance under section 
111 for the emission from capped sources of any air pollut-
ant that is not a greenhouse gas, the Administrator shall 
treat the emission of any greenhouse gas by those entities 
as a nonair quality public health and environmental im-
pact within the meaning of section 111(a)(1). 
‘‘(c) PERFORMANCE STANDARDS.—For purposes of set-
ting a performance standard for source categories identified 
pursuant to subsection (a)— 
‘‘(1) The Administrator shall take into account 
the goal of reducing total United States greenhouse 
gas emissions as set forth in section 702. 
‘‘(2) The Administrator may promulgate a de-
sign, equipment, work practice, or operational stand-
ard, or any combination thereof, under section 111 in 
lieu of a standard of performance under that section 
without regard to any determination of feasibility 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00748
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
749 
that would otherwise be required under section 
111(h). 
‘‘(3) Notwithstanding any other provision, in 
setting the level of each standard required by this sec-
tion, the Administrator shall take into account projec-
tions of allowance prices, such that the marginal cost 
of compliance (expressed as dollars per ton of carbon 
dioxide equivalent reduced) imposed by the standard 
would not, in the judgement of the Administrator, be 
expected to exceed the Administrator’s projected allow-
ance prices over the time period spanning from the 
date of initial compliance to the date that the next re-
visions of the standard would come into effect pursu-
ant to the schedule under section 111(b)(1)(B). 
‘‘(d) DEFINITIONS.—In this section, the terms ‘un-
capped greenhouse gas emissions’ and ‘uncapped methane 
emissions’ mean those greenhouse gas or methane emissions, 
respectively, to which section 722 would not have applied 
if the requirements of this title had been in effect for the 
same year as the emissions data upon which the list is 
based. 
‘‘(e) STUDY
OF
THE EFFECTS
OF PERFORMANCE 
STANDARDS.— 
‘‘(1) STUDY.—The Administrator shall conduct a 
study of the impacts of performance standards re-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00749
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
750 
quired under this section, which shall evaluate the ef-
fect of such standards on the— 
‘‘(A) costs of achieving compliance with the 
economy-wide reduction goals specified in section 
702 and the reduction targets specified in section 
703; 
‘‘(B) available supply of offset credits; and 
‘‘(C) ability to achieve the economy-wide re-
duction goals specified in section 702 and any 
other benefits of such standards. 
‘‘(2) REPORT.—The Administrator shall submit 
to the House Energy and Commerce Committee a re-
port that describes the results of the study not later 
than 18 months after the publication of the standards 
required under subsection (a)(2)(B)(i). 
‘‘PART C—EXEMPTIONS FROM OTHER PROGRAMS 
‘‘SEC. 831. CRITERIA POLLUTANTS. 
‘‘As of the date of the enactment of the Safe Climate 
Act, no greenhouse gas may be added to the list under sec-
tion 108(a) on the basis of its effect on global climate 
change. 
‘‘SEC. 832. INTERNATIONAL AIR POLLUTION. 
‘‘Section 115 shall not apply to an air pollutant with 
respect to that pollutant’s contribution to global warming. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00750
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
751 
‘‘SEC. 833. HAZARDOUS AIR POLLUTANTS. 
‘‘No greenhouse gas may be added to the list of haz-
ardous air pollutants under section 112 unless such green-
house gas meets the listing criteria of section 112(b) inde-
pendent of its effects on global climate change. 
‘‘SEC. 834. NEW SOURCE REVIEW. 
‘‘The provisions of part C of title I shall not apply 
to a major emitting facility that is initially permitted or 
modified after January 1, 2009, on the basis of its emis-
sions of any greenhouse gas. 
‘‘SEC. 835. TITLE V PERMITS. 
‘‘Notwithstanding any provision of title III or V, no 
stationary source shall be required to apply for, or operate 
pursuant to, a permit under title V, solely because the 
source emits any greenhouse gases that are regulated solely 
because of their effect on global climate change.’’. 
SEC. 332. HFC REGULATION. 
(a) IN GENERAL.—Title VI of the Clean Air Act (42 
U.S.C. 7671 et seq.) (relating to stratospheric ozone protec-
tion) is amended by adding at the end the following: 
‘‘SEC. 619. HYDROFLUOROCARBONS (HFCS). 
‘‘(a) TREATMENT
AS CLASS II, GROUP II SUB-
STANCES.—Except as otherwise provided in this section, 
hydrofluorocarbons shall be treated as class II substances 
for purposes of applying the provisions of this title. The 
Administrator shall establish two groups of class II sub-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00751
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
752 
stances. Class II, group I substances shall include all 
hydrochlorofluorocarbons (HCFCs) listed pursuant to sec-
tion 602(b). Class II, group II substances shall include each 
of the following: 
‘‘(1) Hydrofluorocarbon-23 (HFC-23). 
‘‘(2) Hydrofluorocarbon-32 (HFC-32). 
‘‘(3) Hydrofluorocarbon-41 (HFC-41). 
‘‘(4) Hydrofluorocarbon-125 (HFC-125). 
‘‘(5) Hydrofluorocarbon-134 (HFC-134). 
‘‘(6) Hydrofluorocarbon-134a (HFC-134a). 
‘‘(7) Hydrofluorocarbon-143 (HFC-143). 
‘‘(8) Hydrofluorocarbon-143a (HFC-143a). 
‘‘(9) Hydrofluorocarbon-152 (HFC-152). 
‘‘(10) Hydrofluorocarbon-152a (HFC-152a). 
‘‘(11) Hydrofluorocarbon-227ea (HFC-227ea). 
‘‘(12) Hydrofluorocarbon-236cb (HFC-236cb). 
‘‘(13) Hydrofluorocarbon-236ea (HFC-236ea). 
‘‘(14) Hydrofluorocarbon-236fa (HFC-236fa). 
‘‘(15) Hydrofluorocarbon-245ca (HFC-245ca). 
‘‘(16) Hydrofluorocarbon-245fa (HFC-245fa). 
‘‘(17) Hydrofluorocarbon-365mfc (HFC-365mfc). 
‘‘(18) 
Hydrofluorocarbon-43-10mee 
(HFC-43- 
10mee). 
‘‘(19) Hydrofluoroolefin-1234yf (HFO-1234yf). 
‘‘(20) Hydrofluoroolefin-1234ze (HFO-1234ze). 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00752
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
753 
Not later than 6 months after the date of enactment of this 
title, the Administrator shall publish an initial list of class 
II, group II substances, which shall include the substances 
listed in this subsection. The Administrator may add to the 
list of class II, group II substances any other substance used 
as a substitute for a class I or II substance if the Adminis-
trator determines that 1 metric ton of the substance makes 
the same or greater contribution to global warming over 
100 years as 1 metric ton of carbon dioxide. Within 24 
months after the date of enactment of this section, the Ad-
ministrator shall amend the regulations under this title (in-
cluding the regulations referred to in sections 603, 608, 609, 
610, 611, 612, and 613) to apply to class II, group II sub-
stances. 
‘‘(b) CONSUMPTION AND PRODUCTION OF CLASS II, 
GROUP II SUBSTANCES.— 
‘‘(1) IN GENERAL.— 
‘‘(A) CONSUMPTION PHASE DOWN.—In the 
case of class II, group II substances, in lieu of 
applying section 605 and the regulations there-
under, the Administrator shall promulgate regu-
lations phasing down the consumption of class 
II, group II substances in the United States, and 
the importation of products containing any class 
II, group II substance, in accordance with this 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00753
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
754 
subsection within 18 months after the date of en-
actment of this section. Effective January 1, 
2012, it shall be unlawful for any person to 
produce any class II, group II substance, import 
any class II, group II substance, or import any 
product containing any class II, group II sub-
stance without holding one consumption allow-
ance or one destruction offset credit for each car-
bon dioxide equivalent ton of the class II, group 
II substance. Any person who exports a class II, 
group II substance for which a consumption al-
lowance was retired may receive a refund of that 
allowance from the Administrator following the 
export. 
‘‘(B) PRODUCTION.—If the United States 
becomes a party or otherwise adheres to a multi-
lateral agreement, including any amendment to 
the Montreal Protocol on Substances That De-
plete the Ozone Layer, that restricts the produc-
tion of class II, group II substances, the Admin-
istrator shall promulgate regulations establishing 
a baseline for the production of class II, group 
II substances in the United States and phasing 
down the production of class II, group II sub-
stances in the United States, in accordance with 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00754
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
755 
such multilateral agreement and subject to the 
same exceptions and other provisions as are ap-
plicable to the phase down of consumption of 
class II, group II substances under this section 
(except that the Administrator shall not require 
a person who obtains production allowances 
from the Administrator to make payment for 
such allowances if the person is making payment 
for a corresponding quantity of consumption al-
lowances of the same vintage year). Upon the ef-
fective date of such regulations, it shall be un-
lawful for any person to produce any class II, 
group II substance without holding one con-
sumption allowance and one production allow-
ance, or one destruction offset credit, for each 
carbon dioxide equivalent ton of the class II, 
group II substance. 
‘‘(C) INTEGRITY OF CAP.—To maintain the 
integrity of the class II, group II cap, the Ad-
ministrator may, through rulemaking, limit the 
percentage of each person’s compliance obligation 
that may be met through the use of destruction 
offset credits or banked allowances. 
‘‘(D) COUNTING
OF
VIOLATIONS.—Each 
emission allowance or destruction offset credit 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00755
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
756 
not held as required by this section shall be a 
separate violation of this section. 
‘‘(2) SCHEDULE.—Pursuant to the regulations 
promulgated pursuant to paragraph (1), the number 
of class II, group II consumption allowances estab-
lished by the Administrator for each calendar year be-
ginning in 2012 shall be the following percentage of 
the baseline, as established by the Administrator pur-
suant to paragraph (3): 
‘‘Calendar Year 
Percent of Baseline 
2012 
2013 
87.5 
2014 
2015 
82.5 
2016 
2017 
77.5 
2018 
2019 
2020 
2021 
2022 
2023 
2024 
2025 
2026 
2027 
2028 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00756
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
757 
‘‘Calendar Year 
Percent of Baseline 
2029 
2030 
2031 
2032 
after 2032 
‘‘(3) BASELINE.—(A) Within 12 months after the 
date of enactment of this section, the Administrator 
shall promulgate regulations to establish the baseline 
for purposes of paragraph (2). The baseline shall be 
the sum, expressed in tons of carbon dioxide equiva-
lents, of— 
‘‘(i) the annual average consumption of all 
class II substances in calendar years 2004, 2005, 
and 2006; plus 
‘‘(ii) the annual average quantity of all 
class II substances contained in imported prod-
ucts in calendar years 2004, 2005, and 2006. 
‘‘(B) Notwithstanding subparagraph (A), if the 
Administrator determines that the baseline is higher 
than 370 million metric tons of carbon dioxide 
equivalents, then the Administrator shall establish the 
baseline at 370 million metric tons of carbon dioxide 
equivalents. 
‘‘(C) Notwithstanding subparagraph (A), if the 
Administrator determines that the baseline is lower 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00757
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
758 
than 280 million metric tons of carbon dioxide 
equivalents, then the Administrator shall establish the 
baseline at 280 million metric tons of carbon dioxide 
equivalents. 
‘‘(4) DISTRIBUTION OF ALLOWANCES.— 
‘‘(A) IN GENERAL.—Pursuant to the regula-
tions promulgated under paragraph (1), for each 
calendar year beginning in 2012, the Adminis-
trator shall sell consumption allowances in ac-
cordance with this paragraph. 
‘‘(B) ESTABLISHMENT OF POOLS.—The Ad-
ministrator shall establish two allowance pools. 
Eighty percent of the consumption allowances 
available for a calendar year shall be placed in 
the producer-importer pool, and 20 percent of the 
consumption allowances available for a calendar 
year shall be placed in the secondary pool. 
‘‘(C) PRODUCER-IMPORTER POOL.— 
‘‘(i) AUCTION.—(I) For each calendar 
year, the Administrator shall offer for sale 
at auction the following percentage of the 
consumption allowances in the producer-im-
porter pool: 
‘‘Calendar Year 
Percent Available for Auction 
2012 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00758
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
759 
‘‘Calendar Year 
Percent Available for Auction 
2013 
2014 
2015 
2016 
2017 
2018 
2019 
2020 and thereafter 
‘‘(II) Any person who produced or im-
ported any class II substance during cal-
endar year 2004, 2005, or 2006 may par-
ticipate in the auction. No other persons 
may participate in the auction unless per-
mitted to do so pursuant to subclause (III). 
‘‘(III) Not later than three years after 
the date of the initial auction and from 
time to time thereafter, the Administrator 
shall determine through rulemaking whether 
any persons who did not produce or import 
a class II substance during calendar year 
2004, 2005, or 2006 will be permitted to 
participate in future auctions. The Admin-
istrator shall base this determination on the 
duration, consistency, and scale of such per-
son’s purchases of consumption allowances 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00759
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
760 
in the secondary pool under subparagraph 
(D), as well as economic or technical hard-
ship and other factors deemed relevant by 
the Administrator. 
‘‘(IV) The Administrator shall set a 
minimum bid per consumption allowance of 
the following: 
‘‘(aa) For vintage year 2012, 
$1.00. 
‘‘(bb) For vintage year 2013, 
$1.20. 
‘‘(cc) For vintage year 2014, 
$1.40. 
‘‘(dd) For vintage year 2015, 
$1.60. 
‘‘(ee) For vintage year 2016, 
$1.80. 
‘‘(ff) For vintage year 2017, 
$2.00. 
‘‘(gg) For vintage year 2018 and 
thereafter, $2.00 adjusted for inflation 
after vintage year 2017 based upon the 
producer price index as published by 
the Department of Commerce. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00760
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
761 
‘‘(ii) NON-AUCTION
SALE.—(I) For 
each calendar year, as soon as practicable 
after auction, the Administrator shall offer 
for sale the remaining consumption allow-
ances in the producer-importer pool at the 
following prices: 
‘‘(aa) A fee of $1.00 per vintage 
year 2012 allowance. 
‘‘(bb) A fee of $1.20 per vintage 
year 2013 allowance. 
‘‘(cc) A fee of $1.40 per vintage 
year 2014 allowance. 
‘‘(dd) For each vintage year 2015 
allowance, a fee equal to the average of 
$1.10 and the auction clearing price 
for vintage year 2014 allowances. 
‘‘(ee) For each vintage year 2016 
allowance, a fee equal to the average of 
$1.30 and the auction clearing price 
for vintage year 2015 allowances. 
‘‘(ff) For each vintage year 2017 
allowance, a fee equal to the average of 
$1.40 and the auction clearing price 
for vintage year 2016 allowances. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00761
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
762 
‘‘(gg) For each allowance of vin-
tage year 2018 and subsequent vintage 
years, a fee equal to the auction clear-
ing price for that vintage year. 
‘‘(II) The Administrator shall offer to 
sell the remaining consumption allowances 
in the producer-importer pool to producers 
of class II, group II substances and import-
ers of class II, group II substances in pro-
portion to their relative allocation share. 
‘‘(III) Such allocation share for such 
sale shall be determined by the Adminis-
trator using such producer’s or importer’s 
annual average data on class II substances 
from calendar years 2004, 2005, and 2006, 
on a carbon dioxide equivalent basis, and— 
‘‘(aa) shall be based on a pro-
ducer’s production, plus importation, 
plus acquisitions and purchases from 
persons who produced class II sub-
stances in the United States during 
calendar years 2004, 2005, or 2006, 
less exportation, less transfers and sales 
to persons who produced class II sub-
stances in the United States during 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00762
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
763 
calendar years 2004, 2005, or 2006; 
and 
‘‘(bb) for an importer of class II 
substances that did not produce in the 
United States any class II substance 
during calendar years 2004, 2005, and 
2006, shall be based on the importer’s 
importation less exportation. 
For purposes of item (aa), the Adminis-
trator shall account for 100 percent of class 
II, group II substances and 60 percent of 
class II, group I substances. For purposes of 
item (bb), the Administrator shall account 
for 100 percent of class II, group II sub-
stances and 100 percent of class II, group 
I substances. 
‘‘(IV) Any consumption allowances 
made available for nonauction sale to a spe-
cific producer or importer of class II, group 
II substances but not purchased by the spe-
cific producer or importer shall be made 
available for sale to any producer or im-
porter of class II substances during cal-
endar years 2004, 2005, or 2006. If demand 
for such consumption allowances exceeds 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00763
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
764 
supply of such consumption allowances, the 
Administrator shall develop and utilize cri-
teria for the sale of such consumption allow-
ances that may include pro rata shares, his-
toric production and importation, economic 
or technical hardship, or other factors 
deemed relevant by the Administrator. If 
the supply of such consumption allowances 
exceeds demand, the Administrator may 
offer such consumption allowances for sale 
in the secondary pool as set forth in sub-
paragraph (D). 
‘‘(D) SECONDARY POOL.—(i) For each cal-
endar year, as soon as practicable after the auc-
tion required in subparagraph (C), the Adminis-
trator shall offer for sale the consumption allow-
ances in the secondary pool at the prices listed 
in subparagraph (C)(ii). 
‘‘(ii) The Administrator shall accept appli-
cations for purchase of secondary pool consump-
tion allowances from— 
‘‘(I) importers of products containing 
class II, group II substances; 
‘‘(II) persons who purchased any class 
II, group II substance directly from a pro-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00764
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
765 
ducer or importer of class II, group II sub-
stances for use in a product containing a 
class II, group II substance, a manufac-
turing process, or a reclamation process; 
‘‘(III) persons who did not produce or 
import a class II substance during calendar 
year 2004, 2005, or 2006, but who the Ad-
ministrator determines have subsequently 
taken significant steps to produce or import 
a substantial quantity of any class II, 
group II substance; and 
‘‘(IV) persons who produced or im-
ported any class II substance during cal-
endar year 2004, 2005, or 2006. 
‘‘(iii) If the supply of consumption allow-
ances in the secondary pool equals or exceeds the 
demand for consumption allowances in the sec-
ondary pool as presented in the applications for 
purchase, the Administrator shall sell the con-
sumption allowances in the secondary pool to the 
applicants in the amounts requested in the ap-
plications for purchase. Any consumption allow-
ances in the secondary pool not purchased in a 
calendar year may be rolled over and added to 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00765
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
766 
the quantity available in the secondary pool in 
the following year. 
‘‘(iv) If the demand for consumption allow-
ances in the secondary pool as presented in the 
applications for purchase exceeds the supply of 
consumption allowances in the secondary pool, 
the Administrator shall sell the consumption al-
lowances as follows: 
‘‘(I) The Administrator shall first sell 
the consumption allowances in the sec-
ondary pool to any importers of products 
containing class II, group II substances in 
the amounts requested in their applications 
for purchase. If the demand for such con-
sumption allowances exceeds supply of such 
consumption allowances, the Administrator 
shall develop and utilize criteria for the sale 
of such consumption allowances among im-
porters of products containing class II, 
group II substances that may include pro 
rata shares, historic importation, economic 
or technical hardship, or other factors 
deemed relevant by the Administrator. 
‘‘(II) The Administrator shall next sell 
any remaining consumption allowances to 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00766
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
767 
persons identified in subclauses (II) and 
(III) of clause (ii) in the amounts requested 
in their applications for purchase. If the de-
mand for such consumption allowances ex-
ceeds remaining supply of such consump-
tion allowances, the Administrator shall de-
velop and utilize criteria for the sale of such 
consumption allowances among subclauses 
(II) and (III) applicants that may include 
pro rata shares, historic use, economic or 
technical hardship, or other factors deemed 
relevant by the Administrator. 
‘‘(III) The Administrator shall then 
sell any remaining consumption allowances 
to persons who produced or imported any 
class II substance during calendar year 
2004, 2005, or 2006 in the amounts re-
quested in their applications for purchase. 
If demand for such consumption allowances 
exceeds remaining supply of such consump-
tion allowances, the Administrator shall de-
velop and utilize criteria for the sale of such 
consumption allowances that may include 
pro rata shares, historic production and im-
portation, economic or technical hardship, 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00767
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
768 
or other factors deemed relevant by the Ad-
ministrator. 
‘‘(IV) Each person who purchases con-
sumption allowances in a non-auction sale 
under this subparagraph shall be required 
to disclose the person or entity sponsoring 
or benefitting from the purchases if such 
person or entity is, in whole or in part, 
other than the purchaser or the purchaser’s 
employer. 
‘‘(E) DISCRETION
TO
WITHHOLD
ALLOW-
ANCES.—Nothing in this paragraph prevents the 
Administrator from exercising discretion to 
withhold and retire consumption allowances that 
would otherwise be available for auction or non-
auction sale. Not later than 18 months after the 
date of enactment of this section, the Adminis-
trator shall promulgate regulations establishing 
criteria for withholding and retiring consump-
tion allowances. 
‘‘(5) BANKING.—A consumption allowance or de-
struction offset credit may be used to meet the compli-
ance obligation requirements of paragraph (1) in— 
‘‘(A) the vintage year for the allowance or 
destruction offset credit; or 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00768
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
769 
‘‘(B) any calendar year subsequent to the 
vintage year for the allowance or destruction off-
set credit. 
‘‘(6) AUCTIONS.— 
‘‘(A) INITIAL
REGULATIONS.—Not later 
than 18 months after the date of enactment of 
this section, the Administrator shall promulgate 
regulations governing the auction of allowances 
under this section. Such regulations shall include 
the following requirements: 
‘‘(i) FREQUENCY; FIRST
AUCTION.— 
Auctions shall be held one time per year at 
regular intervals, with the first auction to 
be held no later than October 31, 2011. 
‘‘(ii) 
AUCTION
FORMAT.—Auctions 
shall follow a single-round, sealed-bid, uni-
form price format. 
‘‘(iii) 
FINANCIAL
ASSURANCE.—The 
Administrator may establish financial as-
surance requirements to ensure that auction 
participants can and will perform on their 
bids. 
‘‘(iv) DISCLOSURE
OF
BENEFICIAL 
OWNERSHIP.—Each bidder in the auction 
shall be required to disclose the person or 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00769
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
770 
entity sponsoring or benefitting from the 
bidder’s participation in the auction if such 
person or entity is, in whole or in part, 
other than the bidder or the bidder’s em-
ployer. 
‘‘(v) PUBLICATION OF INFORMATION.— 
After the auction, the Administrator shall, 
in a timely fashion, publish the number of 
bidders, number of winning bidders, the 
quantity of allowances sold, and the auction 
clearing price. 
‘‘(vi) BIDDING LIMITS IN 2012.—In the 
vintage year 2012 auction, no auction par-
ticipant may, directly or in concert with 
another participant, bid for or purchase 
more allowances offered for sale at the auc-
tion than the greater of— 
‘‘(I) the number of allowances 
which, when added to the number of 
allowances available for purchase by 
the participant in the producer-im-
porter pool non-auction sale, would 
equal the participant’s annual average 
consumption of class II, group II sub-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00770
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
771 
stances in calendar years 2004, 2005, 
and 2006; or 
‘‘(II) the number of allowances 
equal to the product of— 
‘‘(aa) 1.20 multiplied by the 
participant’s allocation share of 
the producer-importer pool non- 
auction sale as determined under 
paragraph (4)(C)(ii); and 
‘‘(bb) the number of vintage 
year 2012 allowances offered at 
auction. 
‘‘(vii) BIDDING LIMITS IN 2013.—In the 
vintage year 2013 auction, no auction par-
ticipant may, directly or in concert with 
another participant, bid for or purchase 
more allowances offered for sale at the auc-
tion than the product of— 
‘‘(I) 1.15 multiplied by the ratio 
of the total number of vintage year 
2012 allowances purchased by the par-
ticipant from the auction and from the 
producer-importer 
pool 
non-auction 
sale to the total number of vintage year 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00771
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
772 
2012 allowances in the producer-im-
porter pool; and 
‘‘(II) the number of vintage year 
2013 allowances offered at auction. 
‘‘(viii) BIDDING
LIMITS
IN
SUBSE-
QUENT YEARS.—In the auctions for vintage 
year 2014 and subsequent vintage years, no 
auction participant may, directly or in 
concert with another participant, bid for or 
purchase more allowances offered for sale at 
the auction than the product of— 
‘‘(I) 1.15 multiplied by the ratio 
of the highest number of allowances 
held by the participant in any of the 
three prior vintage years to meet its 
compliance obligation under para-
graph (1) to the total number of allow-
ances in the producer-importer pool for 
such vintage year; and 
‘‘(II) the number of allowances of-
fered at auction for that vintage year. 
‘‘(ix) 
OTHER
REQUIREMENTS.—The 
Administrator may include in the regula-
tions such other requirements or provisions 
as the Administrator considers necessary to 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00772
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
773 
promote effective, efficient, transparent, and 
fair administration of auctions under this 
section. 
‘‘(B) REVISION OF REGULATIONS.—The Ad-
ministrator may, at any time, revise the initial 
regulations promulgated under subparagraph 
(A) based on the Administrator’s experience in 
administering allowance auctions. Such revised 
regulations need not meet the requirements iden-
tified in subparagraph (A) if the Administrator 
determines that an alternative auction design 
would be more effective, taking into account fac-
tors including costs of administration, trans-
parency, fairness, and risks of collusion or ma-
nipulation. In determining whether and how to 
revise the initial regulations under this para-
graph, the Administrator shall not consider 
maximization of revenues to the Federal Govern-
ment. 
‘‘(C) DELEGATION OR CONTRACT.—Pursu-
ant to regulations under this section, the Admin-
istrator may, by delegation or contract, provide 
for the conduct of auctions under the Adminis-
trator’s supervision by other departments or 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00773
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
774 
agencies of the Federal Government or by non-
governmental agencies, groups, or organizations. 
‘‘(7) PAYMENTS FOR ALLOWANCES.— 
‘‘(A) INITIAL
REGULATIONS.—Not later 
than 18 months after the date of enactment of 
this section, the Administrator shall promulgate 
regulations governing the payment for allow-
ances purchased in auction and non-auction 
sales under this section. Such regulations shall 
include the requirement that, in the event that 
full payment for purchased allowances is not 
made on the date of purchase, equal payments 
shall be made one time per calendar quarter 
with all payments for allowances of a vintage 
year made by the end of that vintage year. 
‘‘(B) REVISION
OF
REGULATIONS.— The 
Administrator may, at any time, revise the ini-
tial regulations promulgated under subpara-
graph (A) based on the Administrator’s experi-
ence in administering collection of payments. 
Such revised regulations need not meet the re-
quirements identified in subparagraph (A) if the 
Administrator determines that an alternative 
payment structure or frequency would be more 
effective, taking into account factors including 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00774
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
775 
cost of administration, transparency, and fair-
ness. In determining whether and how to revise 
the initial regulations under this paragraph, the 
Administrator shall not consider maximization 
of revenues to the Federal Government. 
‘‘(C) PENALTIES FOR NON-PAYMENT.—Fail-
ure to pay for purchased allowances in accord-
ance with the regulations promulgated pursuant 
to this paragraph shall be a violation of the re-
quirements of subsection (b). Section 113(c)(3) 
shall apply in the case of any person who know-
ingly fails to pay for purchased allowances in 
accordance with the regulations promulgated 
pursuant to this paragraph. 
‘‘(8) IMPORTED PRODUCTS.—If the United States 
becomes a party or otherwise adheres to a multilateral 
agreement, including any amendment to the Montreal 
Protocol on Substances That Deplete the Ozone Layer, 
which restricts the production and consumption of 
class II, group II substances— 
‘‘(A) as of the date on which such agreement 
or amendment enters into force, it shall no 
longer be unlawful for any person to import 
from a party to such agreement or amendment 
any product containing any class II, group II 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00775
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
776 
substance whose production and consumption are 
regulated by such agreement or amendment with-
out holding one consumption allowance or one 
destruction offset credit for each carbon dioxide 
equivalent ton of the class II, group II substance; 
‘‘(B) the Administrator shall promulgate 
regulations within 12 months of the date the 
United States becomes a party or otherwise ad-
heres to such agreement or amendment, or the 
date on which such agreement or amendment en-
ters into force, whichever is later, to establish a 
new baseline for purposes of paragraph (2), 
which new baseline shall be the original baseline 
less the carbon dioxide equivalent of the annual 
average quantity of any class II substances regu-
lated by such agreement or amendment con-
tained in products imported from parties to such 
agreement or amendment in calendar years 
2004, 2005, and 2006; 
‘‘(C) as of the date on which such agreement 
or amendment enters into force, no person im-
porting any product containing any class II, 
group II substance may, directly or in concert 
with another person, purchase any consumption 
allowances for sale by the Administrator for the 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00776
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
777 
importation of products from a party to such 
agreement or amendment that contain any class 
II, group II substance restricted by such agree-
ment or amendment; and 
‘‘(D) the Administrator may adjust the two 
allowance pools established in paragraph (4) 
such that up to 90 percent of the consumption 
allowances available for a calendar year are 
placed in the producer-importer pool with the re-
maining consumption allowances placed in the 
secondary pool. 
‘‘(9) OFFSETS.— 
‘‘(A) 
CHLOROFLUOROCARBON
DESTRUC-
TION.—Within 18 months after the date of enact-
ment of this section, the Administrator shall pro-
mulgate regulations to provide for the issuance of 
offset credits for the destruction, in the calendar 
year 2012 or later, of chlorofluorocarbons in the 
United States. The Administrator shall establish 
and distribute to the destroying entity a quan-
tity of destruction offset credits equal to 0.8 
times the number of tons of carbon dioxide 
equivalents of reduction achieved through the de-
struction. No destruction offset credits shall be 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00777
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
778 
established for the destruction of a class II, group 
II substance. 
‘‘(B) DEFINITION.—For purposes of this 
paragraph, the term ‘destruction’ means the con-
version of a substance by thermal, chemical, or 
other means to another substance with little or 
no carbon dioxide equivalent value and no ozone 
depletion potential. 
‘‘(C) REGULATIONS.—The regulations pro-
mulgated under this paragraph shall include 
standards and protocols for project eligibility, 
certification of destroyers, monitoring, tracking, 
destruction efficiency, quantification of project 
and baseline emissions and carbon dioxide equiv-
alent value, and verification. The Administrator 
shall ensure that destruction offset credits rep-
resent 
real 
and 
verifiable 
destruction 
of 
chlorofluorocarbons or other class I or class II, 
group I, substances authorized under subpara-
graph (D). 
‘‘(D) OTHER SUBSTANCES.—The Adminis-
trator may promulgate regulations to add to the 
list of class I and class II, group I, substances 
that may be destroyed for destruction offset cred-
its, taking into account a candidate substance’s 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00778
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
779 
carbon dioxide equivalent value, ozone depletion 
potential, prevalence in banks in the United 
States, and emission rates, as well as the need 
for additional cost containment under the class 
II, group II cap and the integrity of the class II, 
group II cap. The Administrator shall not add 
a class I or class II, group I substance to the list 
if the consumption of the substance has not been 
completely phased-out internationally (except for 
essential use exemptions or other similar exemp-
tions) pursuant to the Montreal Protocol. 
‘‘(E) EXTENSION OF OFFSETS.—(i) At any 
time after the Administrator promulgates regula-
tions pursuant to subparagraph (A), the Admin-
istrator may add the types of destruction projects 
authorized to receive destruction offset credits 
under this paragraph to the list of types of 
projects eligible for offset credits under section 
733. Nothing in this paragraph shall affect the 
issuance of offset credits under section 740. 
‘‘(ii) The Administrator shall not make the 
addition under clause (i) unless the Adminis-
trator finds that insufficient destruction is occur-
ring or is projected to occur under this para-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00779
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
780 
graph and that the addition would increase de-
struction. 
‘‘(iii) In no event shall more than one de-
struction offset credit be issued under title VII 
and this section for the destruction of the same 
quantity of a substance. 
‘‘(10) LEGAL
STATUS
OF
ALLOWANCES
AND 
CREDITS.—None of the following constitutes a prop-
erty right: 
‘‘(A) A production or consumption allow-
ance. 
‘‘(B) A destruction offset credit. 
‘‘(c) DEADLINES FOR COMPLIANCE.—Notwithstanding 
the deadlines specified for class II substances in sections 
608, 609, 610, 612, and 613 that occur prior to January 
1, 2009, the deadline for promulgating regulations under 
those sections for class II, group II substances shall be Janu-
ary 1, 2012. 
‘‘(d) EXCEPTIONS FOR ESSENTIAL USES.—Notwith-
standing any phase down of production and consumption 
required by this section, to the extent consistent with any 
applicable multilateral agreement to which the United 
States is a party or otherwise adheres, the Administrator 
may provide the following exceptions for essential uses: 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00780
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
781 
‘‘(1) MEDICAL
DEVICES.—The Administrator, 
after notice and opportunity for public comment, and 
in consultation with the Commissioner of the Food 
and Drug Administration, may provide an exception 
for the production and consumption of class II, group 
II substances solely for use in medical devices. 
‘‘(2) AVIATION
SAFETY.—The Administrator, 
after notice and opportunity for public comment, may 
authorize the production and consumption of limited 
quantities of class II, group II substances solely for 
the purposes of aviation safety if the Administrator 
of the Federal Aviation Administration, in consulta-
tion with the Administrator, determines that no safe 
and effective substitute has been developed and that 
such authorization is necessary for aviation safety 
purposes. 
‘‘(e) DEVELOPING COUNTRIES.—Notwithstanding any 
phase down of production required by this section, the Ad-
ministrator, after notice and opportunity for public com-
ment, may authorize the production of limited quantities 
of class II, group II substances in excess of the amounts 
otherwise allowable under this section solely for export to, 
and use in, developing countries. Any production author-
ized under this subsection shall be solely for purposes of sat-
isfying the basic domestic needs of such countries as pro-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00781
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
782 
vided in applicable international agreements, if any, to 
which the United States is a party or otherwise adheres. 
‘‘(f) NATIONAL SECURITY; FIRE SUPPRESSION, ETC.— 
The provisions of subsection (f) and paragraphs (1) and 
(2) of subsection (g) of section 604 shall apply to any con-
sumption and production phase down of class II, group II 
substances in the same manner and to the same extent, con-
sistent with any applicable international agreement to 
which the United States is a party or otherwise adheres, 
as such provisions apply to the substances specified in such 
subsection. 
‘‘(g) ACCELERATED SCHEDULE.—In lieu of section 
606, the provisions of paragraphs (1), (2), and (3) of this 
subsection shall apply in the case of class II, group II sub-
stances. 
‘‘(1) IN GENERAL.—The Administrator shall pro-
mulgate initial regulations not later than 18 months 
after the date of enactment of this section, and revised 
regulations any time thereafter, which establish a 
schedule for phasing down the consumption (and, if 
the condition in subsection (b)(1)(B) is met, the pro-
duction) of class II, group II substances that is more 
stringent than the schedule set forth in this section if, 
based on the availability of substitutes, the Adminis-
trator determines that such more stringent schedule is 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00782
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
783 
practicable, 
taking 
into 
account 
technological 
achievability, safety, and other factors the Adminis-
trator deems relevant, or if the Montreal Protocol, or 
any applicable international agreement to which the 
United States is a party or otherwise adheres, is 
modified or established to include a schedule or other 
requirements to control or reduce production, con-
sumption, or use of any class II, group II substance 
more rapidly than the applicable schedule under this 
section. 
‘‘(2) PETITION.—Any person may submit a peti-
tion to promulgate regulations under this subsection 
in the same manner and subject to the same proce-
dures as are provided in section 606(b). 
‘‘(3) INCONSISTENCY.—If the Administrator de-
termines that the provisions of this section regarding 
banking, allowance rollover, or destruction offset cred-
its create a significant potential for inconsistency 
with the requirements of any applicable international 
agreement to which the United States is a party or 
otherwise adheres, the Administrator may promulgate 
regulations restricting the availability of banking, al-
lowance rollover, or destruction offset credits to the ex-
tent necessary to avoid such inconsistency. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00783
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
784 
‘‘(h) EXCHANGE.—Section 607 shall not apply in the 
case of class II, group II substances. Production and con-
sumption allowances for class II, group II substances may 
be freely exchanged or sold but may not be converted into 
allowances for class II, group I substances. 
‘‘(i) LABELING.—(1) In applying section 611 to prod-
ucts containing or manufactured with class II, group II 
substances, in lieu of the words ‘destroying ozone in the 
upper atmosphere’ on labels required under section 611 
there shall be substituted the words ‘contributing to global 
warming’. 
‘‘(2) The Administrator may, through rulemaking, ex-
empt from the requirements of section 611 products con-
taining or manufactured with class II, group II substances 
determined to have little or no carbon dioxide equivalent 
value compared to other substances used in similar prod-
ucts. 
‘‘(j) NONESSENTIAL PRODUCTS.—For the purposes of 
section 610, class II, group II substances shall be regulated 
under section 610(b), except that in applying section 610(b) 
the word ‘hydrofluorocarbon’ shall be substituted for the 
word ‘chlorofluorocarbon’ and the term ‘class II, group II’ 
shall be substituted for the term ‘class I’. Class II, group 
II substances shall not be subject to the provisions of section 
610(d). 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00784
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
785 
‘‘(k) INTERNATIONAL TRANSFERS.—In the case of class 
II, group II substances, in lieu of sections 616(a) and 
616(b), this subsection shall apply. To the extent consistent 
with any applicable international agreement to which the 
United States is a party or otherwise adheres, including 
any amendment to the Montreal Protocol, the United States 
may engage in transfers with other parties to such agree-
ment or amendment under the following conditions: 
‘‘(1) The United States may transfer production 
allowances to another party to such agreement or 
amendment if, at the time of the transfer, the Admin-
istrator establishes revised production limits for the 
United States accounting for the transfer in accord-
ance with regulations promulgated pursuant to this 
subsection. 
‘‘(2) The United States may acquire production 
allowances from another party to such agreement or 
amendment if, at the time of the transfer, the Admin-
istrator finds that the other party has revised its do-
mestic production limits in the same manner as pro-
vided with respect to transfers by the United States 
in the regulations promulgated pursuant to this sub-
section. 
‘‘(l) RELATIONSHIP TO OTHER LAWS.— 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00785
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
786 
‘‘(1) STATE LAWS.—For purposes of section 116, 
the requirements of this section for class II, group II 
substances shall be treated as requirements for the 
control and abatement of air pollution. 
‘‘(2) MULTILATERAL AGREEMENTS.—Section 614 
shall apply to the provisions of this section con-
cerning class II, group II substances, except that for 
the words ‘Montreal Protocol’ there shall be sub-
stituted the words ‘Montreal Protocol, or any applica-
ble multilateral agreement to which the United States 
is a party or otherwise adheres that restricts the pro-
duction or consumption of class II, group II sub-
stances,’ and for the words ‘Article 4 of the Montreal 
Protocol’ there shall be substituted ‘any provision of 
such multilateral agreement regarding trade with 
non-parties’. 
‘‘(3) FEDERAL FACILITIES.—For purposes of sec-
tion 118, the requirements of this section for class II, 
group II substances and corresponding State, inter-
state, and local requirements, administrative author-
ity, and process and sanctions shall be treated as re-
quirements for the control and abatement of air pollu-
tion within the meaning of section 118. 
‘‘(m) CARBON DIOXIDE EQUIVALENT VALUE.—(1) In 
lieu of section 602(e), the provisions of this subsection shall 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00786
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
787 
apply in the case of class II, group II substances. Simulta-
neously with establishing the list of class II, group II sub-
stances, and simultaneously with any addition to that list, 
the Administrator shall publish the carbon dioxide equiva-
lent value of each listed class II, group II substance, based 
on a determination of the number of metric tons of carbon 
dioxide that makes the same contribution to global warming 
over 100 years as 1 metric ton of each class II, group II 
substance. 
‘‘(2) Not later than February 1, 2017, and not less 
than every 5 years thereafter, the Administrator shall— 
‘‘(A) review, and if appropriate, revise the car-
bon dioxide equivalent values established for class II, 
group II substances based on a determination of the 
number of metric tons of carbon dioxide that makes 
the same contributions to global warming over 100 
years as 1 metric ton of each class II, group II sub-
stance; and 
‘‘(B) publish in the Federal Register the results 
of that review and any revisions. 
‘‘(3) A revised determination published in the Federal 
Register under paragraph (2)(B) shall take effect for pro-
duction of class II, group II substances, consumption of 
class II, group II substances, and importation of products 
containing class II, group II substances starting on Janu-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00787
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
788 
ary 1 of the first calendar year starting at least 9 months 
after the date on which the revised determination was pub-
lished. 
‘‘(4) The Administrator may decrease the frequency of 
review and revision under paragraph (2) if the Adminis-
trator determines that such decrease is appropriate in order 
to synchronize such review and revisions with any similar 
review process carried out pursuant to the United Nations 
Framework Convention on Climate Change, an agreement 
negotiated under that convention, The Vienna Convention 
for the Protection of the Ozone Layer, or an agreement nego-
tiated under that convention, except that in no event shall 
the Administrator carry out such review and revision any 
less frequently than every 10 years. 
‘‘(n) REPORTING REQUIREMENTS.—In lieu of sub-
sections (b) and (c) of section 603, paragraphs (1) and (2) 
of this subsection shall apply in the case of class II, group 
II substances: 
‘‘(1) IN
GENERAL.—On a quarterly basis, or 
such other basis (not less than annually) as deter-
mined by the Administrator, each person who pro-
duced, imported, or exported a class II, group II sub-
stance, or who imported a product containing a class 
II, group II substance, shall file a report with the Ad-
ministrator setting forth the carbon dioxide equiva-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00788
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
789 
lent amount of the substance that such person pro-
duced, imported, or exported, as well as the amount 
that was contained in products imported by that per-
son, during the preceding reporting period. Each such 
report shall be signed and attested by a responsible of-
ficer. If all other reporting is complete, no such report 
shall be required from a person after April 1 of the 
calendar year after such person permanently ceases 
production, importation, and exportation of the sub-
stance, as well as importation of products containing 
the substance, and so notifies the Administrator in 
writing. If the United States becomes a party or oth-
erwise adheres to a multilateral agreement, including 
any amendment to the Montreal Protocol on Sub-
stances That Deplete the Ozone Layer, that restricts 
the production and consumption of class II, group II 
substances, then, if all other reporting is complete, no 
such report shall be required from a person with re-
spect to importation from parties to such agreement 
or amendment of products containing any class II, 
group II substance restricted by such agreement or 
amendment, after April 1 of the calendar year fol-
lowing the year during which such agreement or 
amendment enters into force. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00789
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
790 
‘‘(2) BASELINE REPORTS FOR CLASS II, GROUP II 
SUBSTANCES.— 
‘‘(A) IN GENERAL.—Unless such informa-
tion has been previously reported to the Admin-
istrator, on the date on which the first report 
under paragraph (1) of this subsection is re-
quired to be filed, each person who produced, im-
ported, or exported a class II, group II sub-
stance, or who imported a product containing a 
class II substance, (other than a substance added 
to the list of class II, group II substances after 
the publication of the initial list of such sub-
stances under this section), shall file a report 
with the Administrator setting forth the amount 
of such substance that such person produced, im-
ported, exported, or that was contained in prod-
ucts imported by that person, during each of cal-
endar years 2004, 2005, and 2006. 
‘‘(B) PRODUCERS.—In reporting under sub-
paragraph (A), each person who produced in the 
United States a class II substance during cal-
endar years 2004, 2005, or 2006 shall— 
‘‘(i) report all acquisitions or pur-
chases of class II substances during each of 
calendar years 2004, 2005, and 2006 from 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00790
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
791 
all other persons who produced in the 
United States a class II substance during 
calendar years 2004, 2005, or 2006, and 
supply evidence of such acquisitions and 
purchases as deemed necessary by the Ad-
ministrator; and 
‘‘(ii) report all transfers or sales of 
class II substances during each of calendar 
years 2004, 2005, and 2006 to all other per-
sons who produced in the United States a 
class II substance during calendar years 
2004, 2005, or 2006, and supply evidence of 
such transfers and sales as deemed nec-
essary by the Administrator. 
‘‘(C) ADDED SUBSTANCES.—In the case of a 
substance added to the list of class II, group II 
substances after publication of the initial list of 
such substances under this section, each person 
who produced, imported, exported, or imported 
products containing such substance in calendar 
year 2004, 2005, or 2006 shall file a report with 
the Administrator within 180 days after the date 
on which such substance is added to the list, set-
ting forth the amount of the substance that such 
person produced, imported, and exported, as well 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00791
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
792 
as the amount that was contained in products 
imported by that person, in calendar years 2004, 
2005, and 2006. 
‘‘(o) STRATOSPHERIC OZONE AND CLIMATE PROTEC-
TION FUND.— 
‘‘(1) IN GENERAL.—There is established in the 
Treasury of the United States a Stratospheric Ozone 
and Climate Protection Fund. 
‘‘(2) DEPOSITS.—The Administrator shall de-
posit all proceeds from the auction and non-auction 
sale of allowances under this section into the Strato-
spheric Ozone and Climate Protection Fund. 
‘‘(3) USE.—Amounts deposited into the Strato-
spheric Ozone and Climate Protection Fund shall be 
available, subject to appropriations, exclusively for 
the following purposes: 
‘‘(A) RECOVERY, RECYCLING, AND RECLAMA-
TION.—The Administrator may utilize funds to 
establish a program to incentivize the recovery, 
recycling, and reclamation of any Class II sub-
stances in order to reduce emissions of such sub-
stances. 
‘‘(B) MULTILATERAL FUND.—If the United 
States becomes a party or otherwise adheres to a 
multilateral agreement, including any amend-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00792
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
793 
ment to the Montreal Protocol on Substances 
That Deplete the Ozone Layer, which restricts 
the production and consumption of class II, 
group II substances, the Administrator may uti-
lize funds to meet any related contribution obli-
gation of the United States to the Multilateral 
Fund for the Implementation of the Montreal 
Protocol or similar multilateral fund established 
under such multilateral agreement. 
‘‘(C) BEST-IN-CLASS APPLIANCES DEPLOY-
MENT
PROGRAM.—The Secretary of Energy is 
authorized to utilize funds to carry out the pur-
poses of section 214 of the American Clean En-
ergy and Security Act of 2009. 
‘‘(D) LOW
GLOBAL
WARMING
PRODUCT 
TRANSITION ASSISTANCE PROGRAM.— 
‘‘(i) IN GENERAL.—The Administrator, 
in consultation with the Secretary of En-
ergy, may utilize funds in fiscal years 2012 
through 2022 to establish a program to pro-
vide financial assistance to manufacturers 
of products containing class II, group II 
substances to facilitate the transition to 
products that contain or utilize alternative 
substances with no or low carbon dioxide 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00793
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
794 
equivalent value and no ozone depletion po-
tential. 
‘‘(ii) DEFINITION.—In this subpara-
graph, the term ‘products’ means refrig-
erators, freezers, dehumidifiers, air condi-
tioners, foam insulation, technical aerosols, 
fire protection systems, and semiconductors. 
‘‘(iii) FINANCIAL
ASSISTANCE.—The 
Administrator may provide financial assist-
ance to manufacturers pursuant to clause 
(i) for— 
‘‘(I) the design and configuration 
of new products that use alternative 
substances with no or low carbon diox-
ide equivalent value and no ozone de-
pletion potential; and 
‘‘(II) the redesign and retooling of 
facilities for the manufacture of prod-
ucts in the United States that use al-
ternative substances with no or low 
carbon dioxide equivalent value and no 
ozone depletion potential. 
‘‘(iv) REPORTS.—For any fiscal year 
during which the Administrator provides fi-
nancial assistance pursuant to this sub-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00794
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
795 
paragraph, the Administrator shall submit 
a report to the Congress within 3 months of 
the end of such fiscal year detailing the 
amounts, recipients, specific purposes, and 
results of the financial assistance pro-
vided.’’. 
(b) TABLE OF CONTENTS.—The table of contents of 
title VI of the Clean Air Act (42 U.S.C. 7671 et seq.) is 
amended by adding the following new item at the end there-
of: 
‘‘Sec. 619. Hydrofluorocarbons (HFCs).’’. 
(c) FIRE SUPPRESSION AGENTS.—Section 605(a) of 
the Clean Air Act (42 U.S.C. 7671(a)) is amended— 
(1) by striking ‘‘or’’ at the end of paragraph (2); 
(2) by striking the period at the end of para-
graph (3) and inserting ‘‘; or’’; and 
(3) by adding the following new paragraph after 
paragraph (3): 
‘‘(4) is listed as acceptable for use as a fire sup-
pression agent for nonresidential applications in ac-
cordance with section 612(c).’’. 
(d) MOTOR VEHICLE AIR CONDITIONERS.— 
(1) Section 609(e) of the Clean Air Act (42 
U.S.C. 7671h(e)) is amended by inserting ‘‘, group I’’ 
after each reference to ‘‘class II’’ in the text and head-
ing. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00795
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
796 
(2) Section 609 of the Clean Air Act (42 U.S.C. 
7671h) is amended by adding the following new sub-
section after subsection (e): 
‘‘(f) CLASS II, GROUP II SUBSTANCES.— 
‘‘(1) REPAIR.—The Administrator may promul-
gate regulations establishing requirements for repair 
of motor vehicle air conditioners prior to adding a 
class II, group II substance. 
‘‘(2) SMALL
CONTAINERS.—(A) The Adminis-
trator may promulgate regulations establishing serv-
icing practices and procedures for recovery of class II, 
group II substances from containers which contain 
less than 20 pounds of such class II, group II sub-
stances. 
‘‘(B) Not later than 18 months after enactment 
of this subsection, the Administrator shall either pro-
mulgate regulations requiring that containers which 
contain less than 20 pounds of a class II, group II 
substance be equipped with a device or technology 
that limits refrigerant emissions and leaks from the 
container and limits refrigerant emissions and leaks 
during the transfer of refrigerant from the container 
to the motor vehicle air conditioner or issue a deter-
mination that such requirements are not necessary or 
appropriate. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00796
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
797 
‘‘(C) Not later than 18 months after enactment 
of this subsection, the Administrator shall promulgate 
regulations establishing requirements for consumer 
education materials on best practices associated with 
the use of containers which contain less than 20 
pounds of a class II, group II substance and prohib-
iting the sale or distribution, or offer for sale or dis-
tribution, of any class II, group II substance in any 
container which contains less than 20 pounds of such 
class II, group II substance, unless consumer edu-
cation materials consistent with such requirements 
are displayed and available at point-of-sale locations, 
provided to the consumer, or included in or on the 
packaging of the container which contain less than 20 
pounds of a class II, group II substance. 
‘‘(D) The Administrator may, through rule-
making, extend the requirements established under 
this paragraph to containers which contain 30 
pounds or less of a class II, group II substance if the 
Administrator determines that such action would 
produce significant environmental benefits. 
‘‘(3) RESTRICTION OF SALES.—Effective Janu-
ary 1, 2014, no person may sell or distribute or offer 
to sell or distribute or otherwise introduce into inter-
state commerce any motor vehicle air conditioner re-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00797
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
798 
frigerant in any size container unless the substance 
has been found acceptable for use in a motor vehicle 
air conditioner under section 612.’’. 
(e) SAFE ALTERNATIVES POLICY.—Section 612(e) of 
the Clean Air Act (42 U.S.C. 7671k(e)) is amended by in-
serting ‘‘or class II’’ after each reference to ‘‘class I’’. 
SEC. 333. BLACK CARBON. 
(a) DEFINITION.—As used in this section, the term 
‘‘black carbon’’ means primary light absorbing aerosols, as 
defined by the Administrator, based on the best available 
science. 
(b) BLACK CARBON ABATEMENT REPORT.—Not later 
than one year after the date of enactment of this section, 
the Administrator shall, in consultation with other appro-
priate Federal agencies, submit to Congress a report regard-
ing black carbon emissions. The report shall include the fol-
lowing: 
(1) A summary of the current information and 
research that identifies— 
(A) an inventory of the major sources of 
black carbon emissions in the United States and 
throughout the world, including— 
(i) an estimate of the quantity of cur-
rent and projected future emissions; and 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00798
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
799 
(ii) the net climate forcing of the emis-
sions from such sources, including consider-
ation of co-emissions of other pollutants; 
(B) effective and cost-effective control tech-
nologies, operations, and strategies for additional 
domestic and international black carbon emis-
sions reductions, such as diesel retrofit tech-
nologies on existing on-road, non-road, and sta-
tionary engines and programs to address resi-
dential cookstoves, and forest and agriculture- 
based burning; 
(C) potential metrics and approaches for 
quantifying the climatic effects of black carbon 
emissions, including its radiative forcing and 
warming effects, that may be used to compare 
the climate benefits of different mitigation strate-
gies, including an assessment of the uncertainty 
in such metrics and approaches; and 
(D) the public health and environmental 
benefits associated with additional controls for 
black carbon emissions. 
(2) Recommendations regarding— 
(A) development of additional emissions 
monitoring techniques and capabilities, mod-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00799
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
800 
eling, and other black carbon-related areas of 
study; 
(B) areas of focus for additional study of 
technologies, operations, and strategies with the 
greatest potential to reduce emissions of black 
carbon and associated public health, economic, 
and environmental impacts associated with these 
emissions; and 
(C) actions, in addition to those identified 
by the Administrator under section 851 of the 
Clean Air Act (as added by subsection (c)), the 
Federal Government may take to encourage or 
require reductions in black carbon emissions. 
(c) BLACK CARBON MITIGATION.—Title VIII of the 
Clean Air Act, as added by section 331 of this Act, and 
amended by section 222 of this Act, is further amended by 
adding after part D the following new part: 
‘‘PART E—BLACK CARBON 
‘‘SEC. 851. BLACK CARBON. 
‘‘(a) DOMESTIC BLACK CARBON MITIGATION.—Not 
later than 18 months after the date of enactment of this 
section, the Administrator, taking into consideration the 
public health and environmental impacts of black carbon 
emissions, including the effects on global and regional 
warming, the Arctic, and other snow and ice-covered sur-
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00800
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
801 
faces, shall propose regulations under the existing authori-
ties of this Act to reduce emissions of black carbon or pro-
pose a finding that existing regulations promulgated pursu-
ant to this Act adequately regulate black carbon emissions. 
Not later than two years after the date of enactment of this 
section, the Administrator shall promulgate final regula-
tions under the existing authorities of this Act or finalize 
the proposed finding. 
‘‘(b) INTERNATIONAL BLACK CARBON MITIGATION.— 
‘‘(1) REPORT.—Not later than one year after the 
date of enactment of this section, the Administrator, 
in coordination with the Secretary of State and other 
appropriate Federal agencies, shall transmit a report 
to Congress on the amount, type, and direction of all 
present United States financial, technical, and related 
assistance to foreign countries to reduce, mitigate, 
and otherwise abate black carbon emissions. 
‘‘(2) OTHER
OPPORTUNITIES.—The report re-
quired under paragraph (1) shall also identify oppor-
tunities and recommendations, including action 
under existing authorities, to achieve significant black 
carbon emission reductions in foreign countries 
through technical assistance or other approaches to— 
‘‘(A) promote sustainable solutions to bring 
clean, efficient, safe, and affordable stoves, fuels, 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00801
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
802 
or both stoves and fuels to residents of developing 
countries that are reliant on solid fuels such as 
wood, dung, charcoal, coal, or crop residues for 
home cooking and heating, so as to help reduce 
the public health, environmental, and economic 
impacts of black carbon emissions from these 
sources by— 
‘‘(i) identifying key regions for large- 
scale demonstration efforts, and key part-
ners in each such region; and 
‘‘(ii) developing for each such region a 
large-scale implementation strategy with a 
goal of collectively reaching 20,000,000 
homes over 5 years with interventions that 
will— 
‘‘(I) increase stove efficiency by 
over 50 percent (or such other goal as 
determined by the Administrator); 
‘‘(II) reduce emissions of black 
carbon by over 60 percent (or such 
other goal as determined by the Ad-
ministrator); and 
‘‘(III) reduce the incidence of se-
vere pneumonia in children under 5 
years old by over 30 percent (or such 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00802
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
803 
other goal as determined by the Ad-
ministrator); 
‘‘(B) make technological improvements to 
diesel engines and provide greater access to fuels 
that emit less or no black carbon; 
‘‘(C) reduce unnecessary agricultural or 
other biomass burning where feasible alternatives 
exist; 
‘‘(D) reduce unnecessary fossil fuel burning 
that produces black carbon where feasible alter-
natives exist; 
‘‘(E) reduce other sources of black carbon 
emissions; and 
‘‘(F) improve capacity to achieve greater 
compliance with existing laws to address black 
carbon emissions.’’. 
(d) AUTHORIZATION OF APPROPRIATIONS.—There are 
authorized to be appropriated such sums as are necessary 
to carry out this section. 
SEC. 334. STATES. 
Section 116 of the Clean Air Act (42 U.S.C. 7416) is 
amended by adding the following at the end thereof: ‘‘For 
the purposes of this section, the phrases ‘standard or limita-
tion respecting emissions of air pollutants’ and ‘require-
ments respecting control or abatement of air pollution’ shall 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00803
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
804 
include any provision to: cap greenhouse gas emissions, re-
quire surrender to the State or a political subdivision there-
of of emission allowances or offset credits established or 
issued under this Act, and require the use of such allowances 
or credits as a means of demonstrating compliance with 
requirements established by a State or political subdivision 
thereof.’’. 
SEC. 335. STATE PROGRAMS. 
Title VIII of the Clean Air Act, as added by section 
331 of this Act and amended by several sections of this Act, 
is further amended by adding after part E (as added by 
section 333(c) of this Act) the following new part: 
‘‘PART F—MISCELLANEOUS 
‘‘SEC. 861. STATE PROGRAMS. 
‘‘Notwithstanding section 116, no State or political 
subdivision thereof shall implement or enforce a cap and 
trade program that covers any capped emissions emitted 
during the years 2012 through 2017. For purposes of this 
section, the term ‘cap and trade program’ means a system 
of greenhouse gas regulation under which a State or polit-
ical subdivision issues a limited number of tradable instru-
ments in the nature of emission allowances and requires 
that sources within its jurisdiction surrender such tradeable 
instruments for each unit of greenhouse gases emitted dur-
ing a compliance period. For purposes of this section, a 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00804
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
805 
‘cap-and-trade program’ does not include a target or limit 
on greenhouse gas emissions adopted by a State or political 
subdivision that is implemented other than through the 
issuance and surrender of a limited number of tradable in-
struments in the nature of emission allowances, nor does 
it include any other standard, limit, regulation, or program 
to reduce greenhouse gas emissions that is not implemented 
through the issuance and surrender of a limited number of 
tradeable instruments in the nature of emission allowances. 
For purposes of this section, the term ‘cap and trade pro-
gram’ does not include, among other things, fleet-wide 
motor vehicle emission requirements that allow greater 
emissions with increased vehicle production, or require-
ments that fuels, or other products, meet an average pollu-
tion emission rate or lifecycle greenhouse gas standard. 
‘‘SEC. 862. GRANTS FOR SUPPORT OF AIR POLLUTION CON-
TROL PROGRAMS. 
‘‘The Administrator is authorized to make grants to 
air pollution control agencies pursuant to section 105 for 
purposes of assisting in the implementation of programs to 
address global warming established under the Safe Climate 
Act.’’. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00805
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
806 
SEC. 336. ENFORCEMENT. 
(a) REMAND.—Section 307(b) of the Clean Air Act (42 
U.S.C. 7607(b)) is amended by adding the following new 
paragraph at the end thereof: 
‘‘(3) If the court determines that any action of 
the Administrator is arbitrary, capricious, or other-
wise unlawful, the court may remand such action, 
without vacatur, if vacatur would impair or delay 
protection of the environment or public health or oth-
erwise undermine the timely achievement of the pur-
poses of this Act.’’. 
(b) 
PETITION
FOR
RECONSIDERATION.—Section 
307(d)(7)(B) 
of 
the 
Clean 
Air 
Act 
(42 
U.S.C. 
7607(d)(7)(B)) is amended as follows: 
(1) By inserting after the second sentence ‘‘If a 
petition for reconsideration is filed, the Administrator 
shall take final action on such petition, including 
promulgation of final action either revising or deter-
mining not to revise the action for which reconsider-
ation is sought, within 150 days after the petition is 
received by the Administrator or the petition shall be 
deemed denied for the purpose of judicial review.’’. 
(2) By amending the third sentence to read as 
follows: ‘‘Such person may seek judicial review of such 
denial, or of any other final action, by the Adminis-
trator, in response to a petition for reconsideration, 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00806
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
807 
in the United States court of appeals for the appro-
priate circuit (as provided in subsection (b)).’’. 
SEC. 337. CONFORMING AMENDMENTS. 
(a) FEDERAL ENFORCEMENT.—Section 113 of the 
Clean Air Act (42 U.S.C. 7413) is amended as follows: 
(1) In subsection (a)(3), by striking ‘‘or title 
VI,’’ and inserting ‘‘title VI, title VII, or title VIII’’. 
(2) In subsection (b), by striking ‘‘or a major 
stationary source’’ and inserting ‘‘a major stationary 
source, or a covered EGU under title VIII’’ in the 
material preceding paragraph (1). 
(3) In paragraph (2) of subsection (b), by strik-
ing ‘‘or title VI’’ and inserting ‘‘title VI, title VII, or 
title VIII’’. 
(4) In subsection (c)— 
(A) in the first sentence of paragraph (1), 
by striking ‘‘or title VI (relating to stratospheric 
ozone control),’’ and inserting ‘‘title VI, title VII, 
or title VIII,’’; and 
(B) in the first sentence of paragraph (3), 
by striking ‘‘or VI’’ and inserting ‘‘VI, VII, or 
VIII’’. 
(5) In subsection (d)(1)(B), by striking ‘‘or VI’’ 
and inserting ‘‘VI, VII, or VIII’’. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00807
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
808 
(6) In subsection (f), in the first sentence, by 
striking ‘‘or VI’’ and inserting ‘‘VI, VII, or VIII’’. 
(b) RETENTION OF STATE AUTHORITY.—Section 116 
of the Clean Air Act (42 U.S.C. 7416) is amended as fol-
lows: 
(1) By striking ‘‘and 233’’ and inserting ‘‘233’’. 
(2) By striking ‘‘of moving sources)’’ and insert-
ing ‘‘of moving sources), and 861 (preempting certain 
State greenhouse gas programs for a limited time)’’. 
(c) INSPECTIONS, MONITORING, AND ENTRY.—Section 
114(a) of the Clean Air Act (42 U.S.C. 7414(a)) is amended 
by striking ‘‘section 112,’’ and all that follows through 
‘‘(ii)’’ and inserting the following: ‘‘section 112, or any reg-
ulation of greenhouse gas emissions under title VII or VIII, 
(ii)’’. 
(d) ENFORCEMENT.—Subsection (f) of section 304 of 
the Clean Air Act (42 U.S.C. 7604(f)) is amended as fol-
lows: 
(1) By striking ‘‘; or’’ at the end of paragraph 
(3) thereof and inserting a comma. 
(2) By striking the period at the end of para-
graph (4) thereof and inserting ‘‘, or’’. 
(3) By adding the following after paragraph (4) 
thereof: 
‘‘(5) any requirement of title VII or VIII.’’. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00808
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
809 
(e) ADMINISTRATIVE PROCEEDINGS AND JUDICIAL RE-
VIEW.—Section 307 of the Clean Air Act (42 U.S.C. 7607) 
is amended as follows: 
(1) In subsection (a), by striking ‘‘, or section 
306’’ and inserting ‘‘section 306, or title VII or VIII’’. 
(2) In subsection (b)(1)— 
(A) by striking ‘‘,,’’ and inserting ‘‘,’’ in 
each place such punctuation appears; and 
(B) by striking ‘‘section 120,’’ in the first 
sentence and inserting ‘‘section 120, any final 
action under title VII or VIII,’’. 
(3) In subsection (d)(1) by amending subpara-
graph (S) to read as follows: 
‘‘(S) the promulgation or revision of any 
regulation under title VII or VIII,’’. 
SEC. 338. DAVIS-BACON COMPLIANCE. 
(a) IN GENERAL.—Notwithstanding any other provi-
sion of law and in a manner consistent with other provi-
sions in this Act, to receive emission allowances or funding 
under this Act the recipient shall provide reasonable assur-
ances that all laborers and mechanics employed by contrac-
tors and subcontractors on projects funded directly by or 
assisted in whole or in part by and through the Federal 
Government pursuant to this Act, or by any entity estab-
lished in accordance with this Act, including the Carbon 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00809
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
828 
‘‘(J) establish standards, as necessary, for 
qualification as, and operation of, trading facili-
ties for regulated allowance derivatives; 
‘‘(K) establish standards, as necessary, for 
qualification as, and operation of, clearing orga-
nizations for trading facilities for regulated al-
lowance derivatives; 
‘‘(L) provide boards of trade designated as 
contract markets under the Commodity Ex-
change Act, and market participants, with an 
adequate transition period for compliance with 
any new regulatory requirements established 
under this paragraph; 
‘‘(M) determine whether and to what extent 
offset creation contracts, to the extent incor-
porating regulated allowance derivatives, should 
be governed by the same regulations that apply 
to other regulated allowance derivatives; and 
‘‘(N) include such other requirements as 
necessary to preserve market integrity and facili-
tate compliance with title VII of the Clean Air 
Act and section 610 of the Public Utility Regu-
latory Policies Act of 1978 and the regulations 
promulgated under such title and such section. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00828
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
847 
SEC. 353. INSPECTOR GENERAL OF THE COMMODITY FU-
TURES TRADING COMMISSION. 
(a) ELEVATION OF OFFICE.— 
(1) INCLUSION OF CFTC IN DEFINITION OF ES-
TABLISHMENT.— 
(A) Section 12(1) of the Inspector General 
Act of 1978 (5 U.S.C. App.) is amended by strik-
ing ‘‘or the Federal Cochairpersons of the Com-
missions established under section 15301 of title 
40, United States Code;’’ and inserting ‘‘the Fed-
eral Cochairpersons of the Commissions estab-
lished under section 15301 of title 40, United 
States Code; or the Chairman of the Commodity 
Futures Trading Commission;’’. 
(B) Section 12(2) of the Inspector General 
Act of 1978 (5 U.S.C. App.) is amended by strik-
ing ‘‘or the Commissions established under sec-
tion 15301 of title 40, United States Code,’’ and 
inserting ‘‘the Commissions established under 
section 15301 of title 40, United States Code, or 
the Commodity Futures Trading Commission,’’. 
(2) EXCLUSION OF CFTC FROM DEFINITION OF 
DESIGNATED FEDERAL ENTITY.—Section 8G(a)(2) of 
the Inspector General Act of 1978 (5 U.S.C. App.) is 
amended by striking ‘‘the Commodity Futures Trad-
ing Commission,’’. 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00847
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS
891 
‘‘(C) NEW
ENTITIES.—Not later than 2 
years after the date of enactment of this title, the 
Administrator shall issue regulations governing 
the distribution of emission allowance rebates for 
the first and second years of operation of a new 
entity in an eligible industrial sector. These reg-
ulations shall provide for— 
‘‘(i) the distribution of emission allow-
ance rebates to such entities based on com-
parable entities in the same sector; and 
‘‘(ii) an adjustment in the third and 
fourth years of operation to reconcile the 
total amount of emission allowance rebates 
received during the first and second years of 
operation to the amount the entity would 
have received during the first and second 
years of operation had the appropriate data 
been available. 
‘‘(2) DIRECT CARBON FACTOR.—The direct car-
bon factor for a covered entity for a vintage year is 
the product of— 
‘‘(A) the average output of the covered enti-
ty for the two years preceding the year of the 
distribution; and 
VerDate Nov 24 2008 
21:35 Jun 19, 2009
Jkt 079200
PO 00000
Frm 00891
Fmt 6652
Sfmt 6203
E:\BILLS\H2454.RH
H2454
mstockstill on PROD1PC66 with BILLS