175
SEC. 2303. DEPARTMENT OF ENERGY PROGRAM.
(a) ESTABLISHMENT.—The Secretary, through the
Office of Nuclear Energy, Science and Technology, shall
support a program to maintain the Nation’s human re-
source investment and infrastructure in the nuclear
sciences and engineering consistent with the Department’s
statutory authorities related to civilian nuclear research,
development, and demonstration and commercial applica-
tion of energy technology.
(b) DUTIES OF THE OFFICE OF NUCLEAR ENERGY,
SCIENCE AND TECHNOLOGY.—In carrying out the pro-
gram under this subtitle, the Director of the Office of Nu-
clear Energy, Science and Technology shall—
(1) develop a robust graduate and under-
graduate fellowship program to attract new and tal-
ented students;
(2) assist universities in recruiting and retain-
ing new faculty in the nuclear sciences and engineer-
ing through a Junior Faculty Research Initiation
Grant Program;
(3) maintain a robust investment in the funda-
mental nuclear sciences and engineering through the
Nuclear Engineering Education Research Program;
(4) encourage collaborative nuclear research
among industry, national laboratories, and univer-
176
sities through the Nuclear Energy Research Initia-
tive;
(5) assist universities in maintaining reactor in-
frastructure; and
(6) support communication and outreach re-
lated to nuclear science and engineering.
(c) MAINTAINING
UNIVERSITY
RESEARCH
AND
TRAINING REACTORS
AND ASSOCIATED INFRASTRUC-
TURE.—The Secretary, through the Office of Nuclear En-
ergy, Science and Technology, shall provide for the fol-
lowing university research and training reactor infrastruc-
ture maintenance and research activities:
(1) Refueling of university research reactors
with low enriched fuels, upgrade of operational in-
strumentation, and sharing of reactors among uni-
versities.
(2) In collaboration with the United States nu-
clear industry, assistance, where necessary, in reli-
censing and upgrading university training reactors
as part of a student training program.
(3) A university reactor research and training
award program that provides for reactor improve-
ments as part of a focused effort that emphasizes re-
search, training, and education.
177
(d) 
UNIVERSITY-DOE 
LABORATORY
INTER-
ACTIONS.—The Secretary, through the Office of Nuclear
Energy, Science and Technology, shall develop—
(1) a sabbatical fellowship program for univer-
sity faculty to spend extended periods of time at De-
partment of Energy laboratories in the areas of nu-
clear science and technology; and
(2) a visiting scientist program in which labora-
tory staff can spend time in academic nuclear
science and engineering departments.
The Secretary may under subsection (b)(1) provide for fel-
lowships for students to spend time at Department of En-
ergy laboratories in the areas of nuclear science and tech-
nology under the mentorship of laboratory staff.
(e) OPERATIONS AND MAINTENANCE.—To the extent
that the use of a university research reactor is funded
under this subtitle, funds authorized under this subtitle
may be used to supplement operation of the research reac-
tor during the investigator’s proposed effort. The host in-
stitution shall provide at least 50 percent of the cost of
the reactor’s operation.
(f) MERIT REVIEW REQUIRED.—All grants, con-
tracts, cooperative agreements, or other financial assist-
ance awards under this subtitle shall be made only after
independent merit review.
178
(g) REPORT.—Not later than 6 months after the date
of the enactment of this Act, the Secretary shall prepare
and transmit to the appropriate congressional committees
a 5-year plan on how the programs authorized in this sub-
title will be implemented. The plan shall include a review
of the projected personnel needs in the fields of nuclear
science and engineering and of the scope of nuclear science
and engineering education programs at the Department
and other Federal agencies.
SEC. 2304. AUTHORIZATION OF APPROPRIATIONS.
(a) TOTAL AUTHORIZATION.—The following sums
are authorized to be appropriated to the Secretary, to re-
main available until expended, for the purposes of carrying
out this subtitle:
(1) $30,200,000 for fiscal year 2002.
(2) $41,000,000 for fiscal year 2003.
(3) $47,900,000 for fiscal year 2004.
(4) $55,600,000 for fiscal year 2005.
(5) $64,100,000 for fiscal year 2006.
(b) GRADUATE
AND UNDERGRADUATE FELLOW-
SHIPS.—Of the funds authorized by subsection (a), the fol-
lowing sums are authorized to be appropriated to carry
out section 2303(b)(1):
(1) $3,000,000 for fiscal year 2002.
(2) $3,100,000 for fiscal year 2003.
179
(3) $3,200,000 for fiscal year 2004.
(4) $3,200,000 for fiscal year 2005.
(5) $3,200,000 for fiscal year 2006.
(c) JUNIOR FACULTY RESEARCH INITIATION GRANT
PROGRAM.—Of the funds authorized by subsection (a),
the following sums are authorized to be appropriated to
carry out section 2303(b)(2):
(1) $5,000,000 for fiscal year 2002.
(2) $7,000,000 for fiscal year 2003.
(3) $8,000,000 for fiscal year 2004.
(4) $9,000,000 for fiscal year 2005.
(5) $10,000,000 for fiscal year 2006.
(d) NUCLEAR ENGINEERING EDUCATION RESEARCH
PROGRAM.—Of the funds authorized by subsection (a),
the following sums are authorized to be appropriated to
carry out section 2303(b)(3):
(1) $8,000,000 for fiscal year 2002.
(2) $12,000,000 for fiscal year 2003.
(3) $13,000,000 for fiscal year 2004.
(4) $15,000,000 for fiscal year 2005.
(5) $20,000,000 for fiscal year 2006.
(e) COMMUNICATION AND OUTREACH RELATED TO
NUCLEAR SCIENCE AND ENGINEERING.—Of the funds
authorized by subsection (a), the following sums are au-
180
thorized to be appropriated to carry out section
2303(b)(5):
(1) $200,000 for fiscal year 2002.
(2) $200,000 for fiscal year 2003.
(3) $300,000 for fiscal year 2004.
(4) $300,000 for fiscal year 2005.
(5) $300,000 for fiscal year 2006.
(f) REFUELING OF UNIVERSITY RESEARCH REAC-
TORS AND INSTRUMENTATION UPGRADES.—Of the funds
authorized by subsection (a), the following sums are au-
thorized to be appropriated to carry out section
2303(c)(1):
(1) $6,000,000 for fiscal year 2002.
(2) $6,500,000 for fiscal year 2003.
(3) $7,000,000 for fiscal year 2004.
(4) $7,500,000 for fiscal year 2005.
(5) $8,000,000 for fiscal year 2006.
(g) RELICENSING ASSISTANCE.—Of the funds au-
thorized by subsection (a), the following sums are author-
ized to be appropriated to carry out section 2303(c)(2):
(1) $1,000,000 for fiscal year 2002.
(2) $1,100,000 for fiscal year 2003.
(3) $1,200,000 for fiscal year 2004.
(4) $1,300,000 for fiscal year 2005.
(5) $1,300,000 for fiscal year 2006.
181
(h) REACTOR RESEARCH
AND TRAINING AWARD
PROGRAM.—Of the funds authorized by subsection (a),
the following sums are authorized to be appropriated to
carry out section 2303(c)(3):
(1) $6,000,000 for fiscal year 2002.
(2) $10,000,000 for fiscal year 2003.
(3) $14,000,000 for fiscal year 2004.
(4) $18,000,000 for fiscal year 2005.
(5) $20,000,000 for fiscal year 2006.
(i) 
UNIVERSITY-DOE 
LABORATORY
INTER-
ACTIONS.—Of the funds authorized by subsection (a), the
following sums are authorized to be appropriated to carry
out section 2303(d):
(1) $1,000,000 for fiscal year 2002.
(2) $1,100,000 for fiscal year 2003.
(3) $1,200,000 for fiscal year 2004.
(4) $1,300,000 for fiscal year 2005.
(5) $1,300,000 for fiscal year 2006.
Subtitle B—Advanced Fuel Recy-
cling Technology Research and
Development Program
SEC. 2321. PROGRAM.
(a) IN GENERAL.—The Secretary, through the Direc-
tor of the Office of Nuclear Energy, Science and Tech-
nology, shall conduct an advanced fuel recycling tech-
182
nology research and development program to further the
availability of proliferation-resistant fuel recycling tech-
nologies as an alternative to aqueous reprocessing in sup-
port of evaluation of alternative national strategies for
spent nuclear fuel and the Generation IV advanced reactor
concepts, subject to annual review by the Secretary’s Nu-
clear Energy Research Advisory Committee or other inde-
pendent entity, as appropriate.
(b) REPORTS.—The Secretary shall report on the ac-
tivities of the advanced fuel recycling technology research
and development program, as part of the Department’s
annual budget submission.
(c) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated to the Secretary to carry
out this section—
(1) $10,000,000 for fiscal year 2002; and
(2) such sums as are necessary for fiscal year
2003 and fiscal year 2004.
Subtitle C—Department of Energy
Authorization of Appropriations
SEC. 2341. NUCLEAR ENERGY RESEARCH INITIATIVE.
(a) PROGRAM.—The Secretary, through the Office of
Nuclear Energy, Science and Technology, shall conduct a
Nuclear Energy Research Initiative for grants to be com-
183
petitively awarded and subject to peer review for research
relating to nuclear energy.
(b) OBJECTIVES.—The program shall be directed to-
ward accomplishing the objectives of—
(1) developing advanced concepts and scientific
breakthroughs in nuclear fission and reactor tech-
nology to address and overcome the principal tech-
nical and scientific obstacles to the expanded use of
nuclear energy in the United States;
(2) advancing the state of nuclear technology to
maintain a competitive position in foreign markets
and a future domestic market;
(3) promoting and maintaining a United States
nuclear science and engineering infrastructure to
meet future technical challenges;
(4) providing an effective means to collaborate
on a cost-shared basis with international agencies
and research organizations to address and influence
nuclear technology development worldwide; and
(5) promoting United States leadership and
partnerships in bilateral and multilateral nuclear en-
ergy research.
(c) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated to the Secretary to carry
out this section—
184
(1) $60,000,000 for fiscal year 2002; and
(2) such sums as are necessary for fiscal year
2003 and fiscal year 2004.
SEC. 2342. NUCLEAR ENERGY PLANT OPTIMIZATION PRO-
GRAM.
(a) PROGRAM.—The Secretary, through the Office of
Nuclear Energy, Science and Technology, shall conduct a
Nuclear Energy Plant Optimization research and develop-
ment program jointly with industry and cost-shared by in-
dustry by at least 50 percent and subject to annual review
by the Secretary’s Nuclear Energy Research Advisory
Committee or other independent entity, as appropriate.
(b) OBJECTIVES.—The program shall be directed to-
ward accomplishing the objectives of—
(1) managing long-term effects of component
aging; and
(2) improving the efficiency and productivity of
existing nuclear power stations.
(c) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated to the Secretary to carry
out this section—
(1) $15,000,000 for fiscal year 2002; and
(2) such sums as are necessary for fiscal years
2003 and 2004.
185
SEC. 2343. NUCLEAR ENERGY TECHNOLOGIES.
(a) IN GENERAL.—The Secretary, through the Office
of Nuclear Energy, Science and Technology, shall conduct
a study of Generation IV nuclear energy systems, includ-
ing development of a technology roadmap and perform-
ance of research and development necessary to make an
informed technical decision regarding the most promising
candidates for commercial application.
(b) REACTOR CHARACTERISTICS.—To the extent
practicable, in conducting the study under subsection (a),
the Secretary shall study nuclear energy systems that offer
the highest probability of achieving the goals for Genera-
tion IV nuclear energy systems, including—
(1) economics competitive with any other gen-
erators;
(2) enhanced safety features, including passive
safety features;
(3) substantially reduced production of high-
level waste, as compared with the quantity of waste
produced by reactors in operation on the date of en-
actment of this Act;
(4) highly proliferation-resistant fuel and waste;
(5) sustainable energy generation including op-
timized fuel utilization; and
186
(6) substantially improved thermal efficiency, as
compared with the thermal efficiency of reactors in
operation on the date of enactment of this Act.
(c) CONSULTATION.—In conducting the study under
subsection (a), the Secretary shall consult with appro-
priate representatives of industry, institutions of higher
education, Federal agencies, and international, profes-
sional, and technical organizations.
(d) REPORT.—
(1) IN GENERAL.—Not later than December 31,
2002, the Secretary shall transmit to the appro-
priate congressional committees a report describing
the activities of the Secretary under this section, and
plans for research and development leading to a
public/private cooperative demonstration of one or
more Generation IV nuclear energy systems.
(2) CONTENTS.—The report shall contain—
(A) an assessment of all available tech-
nologies;
(B) a summary of actions needed for the
most promising candidates to be considered as
viable commercial options within the five to ten
years after the date of the report, with consid-
eration of regulatory, economic, and technical
issues;
187
(C) a recommendation of not more than
three promising Generation IV nuclear energy
system concepts for further development;
(D) an evaluation of opportunities for pub-
lic/private partnerships;
(E) a recommendation for structure of a
public/private partnership to share in develop-
ment and construction costs;
(F) a plan leading to the selection and con-
ceptual design, by September 30, 2004, of at
least one Generation IV nuclear energy system
concept recommended under subparagraph (C)
for demonstration through a public/private
partnership;
(G) an evaluation of opportunities for
siting demonstration facilities on Department of
Energy land; and
(H) a recommendation for appropriate in-
volvement of other Federal agencies.
(e) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated to the Secretary to carry
out this section and to carry out the recommendations in
the report transmitted under subsection (d)—
(1) $20,000,000 for fiscal year 2002; and
188
(2) such sums as are necessary for fiscal year
2003 and fiscal year 2004.
SEC. 2344. AUTHORIZATION OF APPROPRIATIONS.
(a) OPERATION AND MAINTENANCE.—There are au-
thorized to be appropriated to the Secretary to carry out
activities authorized under this title for nuclear energy op-
eration and maintenance, including amounts authorized
under sections 2304(a), 2321(c), 2341(c), 2342(c), and
2343(e), and including Advanced Radioisotope Power Sys-
tems, Test Reactor Landlord, and Program Direction,
$191,200,000 for fiscal year 2002, $199,000,000 for fis-
cal year 2003, and $207,000,000 for fiscal year 2004, to
remain available until expended.
(b) CONSTRUCTION.—There are authorized to be ap-
propriated to the Secretary—
(1) $950,000 for fiscal year 2002, $2,200,000
for fiscal year 2003, $1,246,000 for fiscal year
2004, and $1,699,000 for fiscal year 2005 for com-
pletion of construction of Project 99-E-200, Test
Reactor Area Electric Utility Upgrade, Idaho Na-
tional Engineering and Environmental Laboratory;
and
(2) $500,000 for fiscal year 2002, $500,000 for
fiscal year 2003, $500,000 for fiscal year 2004, and
$500,000 for fiscal year 2005, for completion of con-
189
struction of Project 95-E-201, Test Reactor Area
Fire and Life Safety Improvements, Idaho National
Engineering and Environmental Laboratory.
(c) LIMITS ON USE OF FUNDS.—None of the funds
authorized to be appropriated in subsection (a) may be
used for—
(1) Nuclear Energy Isotope Support and Pro-
duction;
(2) Argonne National Laboratory-West Oper-
ations;
(3) Fast Flux Test Facility; or
(4) Nuclear Facilities Management.
TITLE IV—FOSSIL ENERGY
Subtitle A—Coal
SEC. 2401. COAL AND RELATED TECHNOLOGIES PRO-
GRAMS.
(a) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated to the Secretary
$172,000,000 for fiscal year 2002, $179,000,000 for fis-
cal year 2003, and $186,000,000 for fiscal year 2004, to
remain available until expended, for other coal and related
technologies research and development programs, which
shall include—
(1) Innovations for Existing Plants;
(2) Integrated Gasification Combined Cycle;
190
(3) advanced combustion systems;
(4) Turbines;
(5) Sequestration Research and Development;
(6) innovative technologies for demonstration;
(7) Transportation Fuels and Chemicals;
(8) Solid Fuels and Feedstocks;
(9) Advanced Fuels Research; and
(10) Advanced Research.
(b) LIMIT ON USE OF FUNDS.—Notwithstanding sub-
section (a), no funds may be used to carry out the activi-
ties authorized by this section after September 30, 2002,
unless the Secretary has transmitted to the Congress the
report required by this subsection and 1 month has
elapsed since that transmission. The report shall include
a plan containing—
(1) a detailed description of how proposals will
be solicited and evaluated, including a list of all ac-
tivities expected to be undertaken;
(2) a detailed list of technical milestones for
each coal and related technology that will be pur-
sued;
(3) a description of how the programs author-
ized in this subsection will be carried out so as to
complement and not duplicate activities authorized
under division E.
191
Subtitle B—Oil and Gas
SEC. 2421. PETROLEUM-OIL TECHNOLOGY.
The Secretary shall conduct a program of research,
development, demonstration, and commercial application
on petroleum-oil technology. The program shall address—
(1) Exploration and Production Supporting Re-
search;
(2) Oil Technology Reservoir Management/Ex-
tension; and
(3) Effective Environmental Protection.
SEC. 2422. GAS.
The Secretary shall conduct a program of research,
development, demonstration, and commercial application
on natural gas technologies. The program shall address—
(1) Exploration and Production;
(2) Infrastructure; and
(3) Effective Environmental Protection.
Subtitle C—Ultra-Deepwater and
Unconventional Drilling
SEC. 2441. SHORT TITLE.
This subtitle may be cited as the ‘‘Natural Gas and
Other Petroleum Research, Development, and Demonstra-
tion Act of 2001’’.
SEC. 2442. DEFINITIONS.
For purposes of this subtitle—
192
(1) the term ‘‘deepwater’’ means water depths
greater than 200 meters but less than 1,500 meters;
(2) the term ‘‘Fund’’ means the Ultra-Deep-
water and Unconventional Gas Research Fund es-
tablished under section 2450;
(3) the term ‘‘institution of higher education’’
has the meaning given that term in section 101 of
the Higher Education Act of 1965 (20 U.S.C.
1001);
(4) the term ‘‘Research Organization’’ means
the Research Organization created pursuant to sec-
tion 2446(a);
(5) the term ‘‘ultra-deepwater’’ means water
depths greater than 1,500 meters; and
(6) the term ‘‘unconventional’’ means located in
heretofore inaccessible or uneconomic formations on
land.
SEC. 2443. ULTRA-DEEPWATER PROGRAM.
The Secretary shall establish a program of research,
development, and demonstration of ultra-deepwater nat-
ural gas and other petroleum exploration and production
technologies, in areas currently available for Outer Conti-
nental Shelf leasing. The program shall be carried out by
the Research Organization as provided in this subtitle.
193
SEC. 2444. NATIONAL ENERGY TECHNOLOGY LABORATORY.
The National Energy Technology Laboratory and the
United States Geological Survey, when appropriate, shall
carry out programs of long-term research into new natural
gas and other petroleum exploration and production tech-
nologies and environmental mitigation technologies for
production from unconventional and ultra-deepwater re-
sources, including methane hydrates. Such Laboratory
shall also conduct a program of research, development,
and demonstration of new technologies for the reduction
of greenhouse gas emissions from unconventional and
ultra-deepwater natural gas or other petroleum explo-
ration and production activities, including sub-sea floor
carbon sequestration technologies.
SEC. 2445. ADVISORY COMMITTEE.
(a) ESTABLISHMENT.—The Secretary shall, within 3
months after the date of the enactment of this Act, estab-
lish an Advisory Committee consisting of 7 members, each
having extensive operational knowledge of and experience
in the natural gas and other petroleum exploration and
production industry who are not Federal Government em-
ployees or contractors. A minimum of 4 members shall
have extensive knowledge of ultra-deepwater natural gas
or other petroleum exploration and production tech-
nologies, a minimum of 2 members shall have extensive
knowledge of unconventional natural gas or other petro-
194
leum exploration and production technologies, and at least
1 member shall have extensive knowledge of greenhouse
gas emission reduction technologies, including carbon se-
questration.
(b) FUNCTION.—The Advisory Committee shall ad-
vise the Secretary on the selection of an organization to
create the Research Organization and on the implementa-
tion of this subtitle.
(c) COMPENSATION.—Members of the Advisory Com-
mittee shall serve without compensation but shall receive
travel expenses, including per diem in lieu of subsistence,
in accordance with applicable provisions under subchapter
I of chapter 57 of title 5, United States Code.
(d) ADMINISTRATIVE COSTS.—The costs of activities
carried out by the Secretary and the Advisory Committee
under this subtitle shall be paid or reimbursed from the
Fund.
(e) DURATION OF ADVISORY COMMITTEE.—Section
14 of the Federal Advisory Committee Act shall not apply
to the Advisory Committee.
SEC. 2446. RESEARCH ORGANIZATION.
(a) SELECTION OF RESEARCH ORGANIZATION.—The
Secretary, within 6 months after the date of the enactment
of this Act, shall solicit proposals from eligible entities for
the creation of the Research Organization, and within 3
195
months after such solicitation, shall select an entity to cre-
ate the Research Organization.
(b) ELIGIBLE ENTITIES.—Entities eligible to create
the Research Organization shall—
(1) have been in existence as of the date of the
enactment of this Act;
(2) be entities exempt from tax under section
501(c)(3) of the Internal Revenue Code of 1986;
and
(3) be experienced in planning and managing
programs in natural gas or other petroleum explo-
ration and production research, development, and
demonstration.
(c) PROPOSALS.—A proposal from an entity seeking
to create the Research Organization shall include a de-
tailed description of the proposed membership and struc-
ture of the Research Organization.
(d) FUNCTIONS.—The Research Organization shall—
(1) award grants on a competitive basis to
qualified—
(A) research institutions;
(B) institutions of higher education;
(C) companies; and
(D) consortia formed among institutions
and companies described in subparagraphs (A)
196
through (C) for the purpose of conducting re-
search, development, and demonstration of un-
conventional and ultra-deepwater natural gas or
other petroleum exploration and production
technologies; and
(2) review activities under those grants to en-
sure that they comply with the requirements of this
subtitle and serve the purposes for which the grant
was made.
SEC. 2447. GRANTS.
(a) TYPES OF GRANTS.—
(1) UNCONVENTIONAL.—The Research Organi-
zation shall award grants for research, development,
and demonstration of technologies to maximize the
value of the Government’s natural gas and other pe-
troleum resources in unconventional reservoirs, and
to develop technologies to increase the supply of nat-
ural gas and other petroleum resources by lowering
the cost and improving the efficiency of exploration
and production of unconventional reservoirs, while
improving safety and minimizing environmental im-
pacts.
(2) ULTRA-DEEPWATER.—The Research Orga-
nization shall award grants for research, develop-
ment, and demonstration of natural gas or other pe-
197
troleum exploration and production technologies
to—
(A) maximize the value of the Federal
Government’s natural gas and other petroleum
resources in the ultra-deepwater areas;
(B) increase the supply of natural gas and
other petroleum resources by lowering the cost
and improving the efficiency of exploration and
production of ultra-deepwater reservoirs; and
(C) improve safety and minimize the envi-
ronmental impacts of ultra-deepwater develop-
ments.
(3) ULTRA-DEEPWATER
ARCHITECTURE.—The
Research Organization shall award a grant to one or
more consortia described in section 2446(d)(1)(D)
for the purpose of developing and demonstrating the
next generation architecture for ultra-deepwater pro-
duction of natural gas and other petroleum in fur-
therance of the purposes stated in paragraph (2)(A)
through (C).
(b) CONDITIONS
FOR GRANTS.—Grants provided
under this section shall contain the following conditions:
(1) If the grant recipient consists of more than
one entity, the recipient shall provide a signed con-
tract agreed to by all participating members clearly
198
defining all rights to intellectual property for exist-
ing technology and for future inventions conceived
and developed using funds provided under the grant,
in a manner that is consistent with applicable laws.
(2) There shall be a repayment schedule for
Federal dollars provided for demonstration projects
under the grant in the event of a successful commer-
cialization of the demonstrated technology. Such re-
payment schedule shall provide that the payments
are made to the Secretary with the express intent
that these payments not impede the adoption of the
demonstrated technology in the marketplace. In the
event that such impedance occurs due to market
forces or other factors, the Research Organization
shall renegotiate the grant agreement so that the ac-
ceptance of the technology in the marketplace is en-
abled.
(3) Applications for grants for demonstration
projects shall clearly state the intended commercial
applications of the technology demonstrated.
(4) The total amount of funds made available
under a grant provided under subsection (a)(3) shall
not exceed 50 percent of the total cost of the activi-
ties for which the grant is provided.
199
(5) The total amount of funds made available
under a grant provided under subsection (a)(1) or
(2) shall not exceed 50 percent of the total cost of
the activities covered by the grant, except that the
Research Organization may elect to provide grants
covering a higher percentage, not to exceed 90 per-
cent, of total project costs in the case of grants
made solely to independent producers.
(6) An appropriate amount of funds provided
under a grant shall be used for the broad dissemina-
tion of technologies developed under the grant to in-
terested institutions of higher education, industry,
and appropriate Federal and State technology enti-
ties to ensure the greatest possible benefits for the
public and use of government resources.
(7) Demonstrations of ultra-deepwater tech-
nologies for which funds are provided under a grant
may be conducted in ultra-deepwater or deepwater
locations.
(c) ALLOCATION OF FUNDS.—Funds available for
grants under this subtitle shall be allocated as follows:
(1) 15 percent shall be for grants under sub-
section (a)(1).
(2) 15 percent shall be for grants under sub-
section (a)(2).
200
(3) 60 percent shall be for grants under sub-
section (a)(3).
(4) 10 percent shall be for carrying out section
2444.
SEC. 2448. PLAN AND FUNDING.
(a) TRANSMITTAL TO SECRETARY.—The Research
Organization shall transmit to the Secretary an annual
plan proposing projects and funding of activities under
each paragraph of section 2447(a).
(b) REVIEW.—The Secretary shall have 1 month to
review the annual plan, and shall approve the plan, if it
is consistent with this subtitle. If the Secretary approves
the plan, the Secretary shall provide funding as proposed
in the plan.
(c) DISAPPROVAL.—If the Secretary does not approve
the plan, the Secretary shall notify the Research Organiza-
tion of the reasons for disapproval and shall withhold
funding until a new plan is submitted which the Secretary
approves. Within 1 month after notifying the Research Or-
ganization of a disapproval, the Secretary shall notify the
appropriate congressional committees of the disapproval.
SEC. 2449. AUDIT.
The Secretary shall retain an independent, commer-
cial auditor to determine the extent to which the funds
authorized by this subtitle have been expended in a man-
201
ner consistent with the purposes of this subtitle. The audi-
tor shall transmit a report annually to the Secretary, who
shall transmit the report to the appropriate congressional
committees, along with a plan to remedy any deficiencies
cited in the report.
SEC. 2450. FUND.
(a) ESTABLISHMENT.—There is established in the
Treasury of the United States a fund to be known as the
‘‘Ultra-Deepwater and Unconventional Gas Research
Fund’’ which shall be available for obligation to the extent
provided in advance in appropriations Acts for allocation
under section 2447(c).
(b) FUNDING SOURCES.—
(1) LOANS FROM TREASURY.—There are au-
thorized to be appropriated to the Secretary
$900,000,000 for the period encompassing fiscal
years 2002 through 2009. Such amounts shall be
deposited by the Secretary in the Fund, and shall be
considered loans from the Treasury. Income received
by the United States in connection with any ultra-
deepwater oil and gas leases shall be deposited in
the Treasury and considered as repayment for the
loans under this paragraph.
(2) ADDITIONAL APPROPRIATIONS.—There are
authorized to be appropriated to the Secretary such
202
sums as may be necessary for the fiscal years 2002
through 2009, to be deposited in the Fund.
(3) OIL AND GAS LEASE INCOME.—To the ex-
tent provided in advance in appropriations Acts, not
more than 7.5 percent of the income of the United
States from Federal oil and gas leases may be de-
posited in the Fund for fiscal years 2002 through
2009.
SEC. 2451. SUNSET.
No funds are authorized to be appropriated for car-
rying out this subtitle after fiscal year 2009. The Research
Organization shall be terminated when it has expended all
funds made available pursuant to this subtitle.
Subtitle D—Fuel Cells
SEC. 2461. FUEL CELLS.
(a) IN GENERAL.—The Secretary shall conduct a
program of research, development, demonstration, and
commercial application on fuel cells. The program shall
address—
(1) Advanced Research;
(2) Systems Development;
(3) Vision 21-Hybrids; and
(4) Innovative Concepts.
(b) MANUFACTURING
PRODUCTION
AND
PROC-
ESSES.—In addition to the program under subsection (a),
203
the Secretary, in consultation other Federal agencies, as
appropriate, shall establish a program for the demonstra-
tion of fuel cell technologies, including fuel cell proton ex-
change membrane technology, for commercial, residential,
and transportation applications. The program shall spe-
cifically focus on promoting the application of and im-
proved manufacturing production and processes for fuel
cell technologies.
(c) AUTHORIZATION OF APPROPRIATIONS.—Within
the amounts authorized to be appropriated under section
2481(a), there are authorized to be appropriated to the
Secretary for the purpose of carrying out subsection (b),
$28,000,000 for each of fiscal years 2002 through 2004.
Subtitle E—Department of Energy
Authorization of Appropriations
SEC. 2481. AUTHORIZATION OF APPROPRIATIONS.
(a) OPERATION AND MAINTENANCE.—There are au-
thorized to be appropriated to the Secretary for operation
and maintenance for subtitle B and subtitle D, and for
Fossil Energy Research and Development Headquarters
Program Direction, Field Program Direction, Plant and
Capital Equipment, Cooperative Research and Develop-
ment, Import/Export Authorization, and Advanced Met-
allurgical Processes $282,000,000 for fiscal year 2002,
204
$293,000,000 for fiscal year 2003, and $305,000,000 for
fiscal year 2004, to remain available until expended.
(b) LIMITS ON USE OF FUNDS.—None of the funds
authorized to be appropriated in subsection (a) may be
used for—
(1) Gas Hydrates.
(2) Fossil Energy Environmental Restoration;
or
(3) research, development, demonstration, and
commercial application on coal and related tech-
nologies, including activities under subtitle A.
TITLE V—SCIENCE
Subtitle A—Fusion Energy
Sciences
SEC. 2501. SHORT TITLE.
This subtitle may be cited as the ‘‘Fusion Energy
Sciences Act of 2001’’.
SEC. 2502. FINDINGS.
The Congress finds that—
(1) economic prosperity is closely linked to an
affordable and ample energy supply;
(2) environmental quality is closely linked to en-
ergy production and use;
(3) population, worldwide economic develop-
ment, energy consumption, and stress on the envi-
205
ronment are all expected to increase substantially in
the coming decades;
(4) the few energy options with the potential to
meet economic and environmental needs for the
long-term future should be pursued as part of a bal-
anced national energy plan;
(5) fusion energy is an attractive long-term en-
ergy source because of the virtually inexhaustible
supply of fuel, and the promise of minimal adverse
environmental impact and inherent safety;
(6) the National Research Council, the Presi-
dent’s Committee of Advisers on Science and Tech-
nology, and the Secretary of Energy Advisory Board
have each recently reviewed the Fusion Energy
Sciences Program and each strongly supports the
fundamental science and creative innovation of the
program, and has confirmed that progress toward
the goal of producing practical fusion energy has
been excellent, although much scientific and engi-
neering work remains to be done;
(7) each of these reviews stressed the need for
a magnetic fusion burning plasma experiment to ad-
dress key scientific issues and as a necessary step in
the development of fusion energy;
206
(8) the National Research Council has also
called for a broadening of the Fusion Energy
Sciences Program research base as a means to more
fully integrate the fusion science community into the
broader scientific community; and
(9) the Fusion Energy Sciences Program budg-
et is inadequate to support the necessary science and
innovation for the present generation of experiments,
and cannot accommodate the cost of a burning plas-
ma experiment constructed by the United States, or
even the cost of key participation by the United
States in an international effort.
SEC. 2503. PLAN FOR FUSION EXPERIMENT.
(a) PLAN FOR UNITED STATES FUSION EXPERI-
MENT.—The Secretary, on the basis of full consultation
with the Fusion Energy Sciences Advisory Committee and
the Secretary of Energy Advisory Board, as appropriate,
shall develop a plan for United States construction of a
magnetic fusion burning plasma experiment for the pur-
pose of accelerating scientific understanding of fusion
plasmas. The Secretary shall request a review of the plan
by the National Academy of Sciences, and shall transmit
the plan and the review to the Congress by July 1, 2004.
(b) REQUIREMENTS OF PLAN.—The plan described
in subsection (a) shall—
207
(1) address key burning plasma physics issues;
and
(2) include specific information on the scientific
capabilities of the proposed experiment, the rel-
evance of these capabilities to the goal of practical
fusion energy, and the overall design of the experi-
ment including its estimated cost and potential con-
struction sites.
(c) UNITED STATES PARTICIPATION IN AN INTER-
NATIONAL EXPERIMENT.—In addition to the plan de-
scribed in subsection (a), the Secretary, on the basis of
full consultation with the Fusion Energy Sciences Advi-
sory Committee and the Secretary of Energy Advisory
Board, as appropriate, may also develop a plan for United
States participation in an international burning plasma
experiment for the same purpose, whose construction is
found by the Secretary to be highly likely and where
United States participation is cost effective relative to the
cost and scientific benefits of a domestic experiment de-
scribed in subsection (a). If the Secretary elects to develop
a plan under this subsection, he shall include the informa-
tion described in subsection (b), and an estimate of the
cost of United States participation in such an inter-
national experiment. The Secretary shall request a review
by the National Academies of Sciences and Engineering
208
of a plan developed under this subsection, and shall trans-
mit the plan and the review to the Congress not later than
July 1, 2004.
(d) AUTHORIZATION OF RESEARCH AND DEVELOP-
MENT.—The Secretary, through the Fusion Energy
Sciences Program, may conduct any research and develop-
ment necessary to fully develop the plans described in this
section.
SEC. 2504. PLAN FOR FUSION ENERGY SCIENCES PRO-
GRAM.
Not later than 6 months after the date of the enact-
ment of this Act, the Secretary, in full consultation with
FESAC, shall develop and transmit to the Congress a plan
for the purpose of ensuring a strong scientific base for
the Fusion Energy Sciences Program and to enable the
experiments described in section 2503. Such plan shall in-
clude as its objectives—
(1) to ensure that existing fusion research fa-
cilities and equipment are more fully utilized with
appropriate measurements and control tools;
(2) to ensure a strengthened fusion science the-
ory and computational base;
(3) to ensure that the selection of and funding
for new magnetic and inertial fusion research facili-
209
ties is based on scientific innovation and cost effec-
tiveness;
(4) to improve the communication of scientific
results and methods between the fusion science com-
munity and the wider scientific community;
(5) to ensure that adequate support is provided
to optimize the design of the magnetic fusion burn-
ing plasma experiments referred to in section 2503;
(6) to ensure that inertial confinement fusion
facilities are utilized to the extent practicable for the
purpose of inertial fusion energy research and devel-
opment;
(7) to develop a roadmap for a fusion-based en-
ergy source that shows the important scientific ques-
tions, the evolution of confinement configurations,
the relation between these two features, and their re-
lation to the fusion energy goal;
(8) to establish several new centers of excel-
lence, selected through a competitive peer-review
process and devoted to exploring the frontiers of fu-
sion science;
(9) to ensure that the National Science Foun-
dation, and other agencies, as appropriate, play a
role in extending the reach of fusion science and in
sponsoring general plasma science; and
210
(10) to ensure that there be continuing broad
assessments of the outlook for fusion energy and
periodic external reviews of fusion energy sciences.
SEC. 2505. AUTHORIZATION OF APPROPRIATIONS.
There are authorized to be appropriated to the Sec-
retary for the development and review, but not for imple-
mentation, of the plans described in this subtitle and for
activities of the Fusion Energy Sciences Program
$320,000,000 for fiscal year 2002 and $335,000,000 for
fiscal year 2003, of which up to $15,000,000 for each of
fiscal year 2002 and fiscal year 2003 may be used to es-
tablish several new centers of excellence, selected through
a competitive peer-review process and devoted to exploring
the frontiers of fusion science.
Subtitle B—Spallation Neutron
Source
SEC. 2521. DEFINITION.
For the purposes of this subtitle, the term ‘‘Spall-
ation Neutron Source’’ means Department Project 99–E–
334, Oak Ridge National Laboratory, Oak Ridge, Ten-
nessee.
SEC. 2522. AUTHORIZATION OF APPROPRIATIONS.
(a) AUTHORIZATION OF CONSTRUCTION FUNDING.—
There are authorized to be appropriated to the Secretary
for construction of the Spallation Neutron Source—
211
(1) $276,300,000 for fiscal year 2002;
(2) $210,571,000 for fiscal year 2003;
(3) $124,600,000 for fiscal year 2004;
(4) $79,800,000 for fiscal year 2005; and
(5) $41,100,000 for fiscal year 2006 for com-
pletion of construction.
(b) AUTHORIZATION
OF OTHER PROJECT FUND-
ING.—There are authorized to be appropriated to the Sec-
retary for other project costs (including research and de-
velopment necessary to complete the project, preoperations
costs, and capital equipment not related to construction)
of the Spallation Neutron Source $15,353,000 for fiscal
year 2002 and $103,279,000 for the period encompassing
fiscal years 2003 through 2006, to remain available until
expended through September 30, 2006.
SEC. 2523. REPORT.
The Secretary shall report on the Spallation Neutron
Source as part of the Department’s annual budget submis-
sion, including a description of the achievement of mile-
stones, a comparison of actual costs to estimated costs,
and any changes in estimated project costs or schedule.
SEC. 2524. LIMITATIONS.
The total amount obligated by the Department, in-
cluding prior year appropriations, for the Spallation Neu-
tron Source may not exceed—
212
(1) $1,192,700,000 for costs of construction;
(2) $219,000,000 for other project costs; and
(3) $1,411,700,000 for total project cost.
Subtitle C—Facilities,
Infrastructure, and User Facilities
SEC. 2541. DEFINITION.
For purposes of this subtitle—
(1) the term ‘‘nonmilitary energy laboratory’’
means—
(A) Ames Laboratory;
(B) Argonne National Laboratory;
(C) Brookhaven National Laboratory;
(D) Fermi National Accelerator Labora-
tory;
(E) Lawrence Berkeley National Labora-
tory;
(F) Oak Ridge National Laboratory;
(G) Pacific Northwest National Labora-
tory;
(H) Princeton Plasma Physics Laboratory;
(I) Stanford Linear Accelerator Center;
(J) Thomas Jefferson National Accelerator
Facility; or
(K) any other facility of the Department
that the Secretary, in consultation with the Di-
213
rector, Office of Science and the appropriate
congressional committees, determines to be con-
sistent with the mission of the Office of
Science; and
(2) the term ‘‘user facility’’ means—
(A) an Office of Science facility at a non-
military energy laboratory that provides special
scientific and research capabilities, including
technical expertise and support as appropriate,
to serve the research needs of the Nation’s uni-
versities, industry, private laboratories, Federal
laboratories, and others, including research in-
stitutions or individuals from other nations
where reciprocal accommodations are provided
to United States research institutions and indi-
viduals or where the Secretary considers such
accommodation to be in the national interest;
and
(B) any other Office of Science funded fa-
cility designated by the Secretary as a user fa-
cility.
214
SEC. 2542. FACILITY AND INFRASTRUCTURE SUPPORT FOR
NONMILITARY ENERGY LABORATORIES.
(a) FACILITY POLICY.—The Secretary shall develop
and implement a least-cost nonmilitary energy laboratory
facility and infrastructure strategy for—
(1) maintaining existing facilities and infra-
structure, as needed;
(2) closing unneeded facilities;
(3) making facility modifications; and
(4) building new facilities.
(b) PLAN.—The Secretary shall prepare a com-
prehensive 10-year plan for conducting future facility
maintenance, making repairs, modifications, and new ad-
ditions, and constructing new facilities at each nonmilitary
energy laboratory. Such plan shall provide for facilities
work in accordance with the following priorities:
(1) Providing for the safety and health of em-
ployees, visitors, and the general public with regard
to correcting existing structural, mechanical, elec-
trical, and environmental deficiencies.
(2) Providing for the repair and rehabilitation
of existing facilities to keep them in use and prevent
deterioration, if feasible.
(3) Providing engineering design and construc-
tion services for those facilities that require modi-
215
fication or additions in order to meet the needs of
new or expanded programs.
(c) REPORT.—
(1) TRANSMITTAL.—Within 1 year after the
date of the enactment of this Act, the Secretary
shall prepare and transmit to the appropriate con-
gressional committees a report containing the plan
prepared under subsection (b).
(2) CONTENTS.—For each nonmilitary energy
laboratory, such report shall contain—
(A) the current priority list of proposed fa-
cilities and infrastructure projects, including
cost and schedule requirements;
(B) a current ten-year plan that dem-
onstrates the reconfiguration of its facilities and
infrastructure to meet its missions and to ad-
dress its long-term operational costs and return
on investment;
(C) the total current budget for all facili-
ties and infrastructure funding; and
(D) the current status of each facilities
and infrastructure project compared to the
original baseline cost, schedule, and scope.
(3) ADDITIONAL ELEMENTS.—The report shall
also—
216
(A) include a plan for new facilities and fa-
cility modifications at each nonmilitary energy
laboratory that will be required to meet the De-
partment’s changing missions of the twenty-
first century, including schedules and estimates
for implementation, and including a section out-
lining long-term funding requirements con-
sistent with anticipated budgets and annual au-
thorization of appropriations;
(B) address the coordination of moderniza-
tion and consolidation of facilities among the
nonmilitary energy laboratories in order to meet
changing mission requirements; and
(C) provide for annual reports to the ap-
propriate congressional committees on accom-
plishments, conformance to schedules, commit-
ments, and expenditures.
SEC. 2543. USER FACILITIES.
(a) NOTICE REQUIREMENT.—When the Department
makes a user facility available to universities and other
potential users, or seeks input from universities and other
potential users regarding significant characteristics or
equipment in a user facility or a proposed user facility,
the Department shall ensure broad public notice of such
217
availability or such need for input to universities and other
potential users.
(b) COMPETITION REQUIREMENT.—When the De-
partment considers the participation of a university or
other potential user in the establishment or operation of
a user facility, the Department shall employ full and open
competition in selecting such a participant.
(c) PROHIBITION.—The Department may not redes-
ignate a user facility, as defined by section 2541(b) as
something other than a user facility for avoid the require-
ments of subsections (a) and (b).
Subtitle D—Advisory Panel on
Office of Science
SEC. 2561. ESTABLISHMENT.
The Director of the Office of Science and Technology
Policy, in consultation with the Secretary, shall establish
an Advisory Panel on the Office of Science comprised of
knowledgeable individuals to—
(1) address concerns about the current status
and the future of scientific research supported by
the Office;
(2) examine alternatives to the current organi-
zational structure of the Office within the Depart-
ment, taking into consideration existing structures
218
for the support of scientific research in other Fed-
eral agencies and the private sector; and
(3) suggest actions to strengthen the scientific
research supported by the Office that might be
taken jointly by the Department and Congress.
SEC. 2562. REPORT.
Within 6 months after the date of the enactment of
this Act, the Advisory Panel shall transmit its findings
and recommendations in a report to the Director of the
Office of Science and Technology Policy and the Sec-
retary. The Director and the Secretary shall jointly—
(1) consider each of the Panel’s findings and
recommendations, and comment on each as they
consider appropriate; and
(2) transmit the Panel’s report and the com-
ments of the Director and the Secretary on the re-
port to the appropriate congressional committees
within 9 months after the date of the enactment of
this Act.
Subtitle E—Department of Energy
Authorization of Appropriations
SEC. 2581. AUTHORIZATION OF APPROPRIATIONS.
(a) OPERATION AND MAINTENANCE.—Including the
amounts authorized to be appropriated for fiscal year
2002 under section 2505 for Fusion Energy Sciences and
219
under section 2522(b) for the Spallation Neutron Source,
there are authorized to be appropriated to the Secretary
for the Office of Science (also including subtitle C, High
Energy Physics, Nuclear Physics, Biological and Environ-
mental Research, Basic Energy Sciences (except for the
Spallation Neutron Source), Advanced Scientific Com-
puting Research, Energy Research Analysis, Multipro-
gram Energy Laboratories-Facilities Support, Facilities
and Infrastructure, Safeguards and Security, and Pro-
gram 
Direction) 
operation 
and 
maintenance
$3,299,558,000 for fiscal year 2002, to remain available
until expended.
(b) RESEARCH REGARDING PRECIOUS METAL CA-
TALYSIS.—Within the amounts authorized to be appro-
priated to the Secretary under subsection (a), $5,000,000
for fiscal year 2002 may be used to carry out research
in the use of precious metals (excluding platinum, palla-
dium, and rhodium) in catalysis, either directly though na-
tional laboratories, or through the award of grants, coop-
erative agreements, or contracts with public or nonprofit
entities.
(c) CONSTRUCTION.—In addition to the amounts au-
thorized to be appropriated under section 2522(a) for con-
struction of the Spallation Neutron Source, there are au-
thorized to be appropriated to the Secretary for Science—
220
(1) $11,400,000 for fiscal year 2002 for com-
pletion 
of 
construction 
of 
Project 
98-G-304,
Neutrinos at the Main Injector, Fermi National Ac-
celerator Laboratory;
(2) $11,405,000 for fiscal year 2002 for com-
pletion of construction of Project 01-E-300, Labora-
tory for Comparative and Functional Genomics, Oak
Ridge National Laboratory;
(3) $4,000,000 for fiscal year 2002, $8,000,000
for fiscal year 2003, and $2,000,000 for fiscal year
2004 for completion of construction of Project 02-
SC-002, Project Engineering Design (PED), Var-
ious Locations;
(4) $3,183,000 for fiscal year 2002 for comple-
tion of construction of Project 02-SC-002, Multipro-
gram Energy Laboratories Infrastructure Project
Engineering Design (PED), Various Locations; and
(5) $18,633,000 for fiscal year 2002 and
$13,029,000 for fiscal year 2003 for completion of
construction of Project MEL-001, Multiprogram En-
ergy Laboratories, Infrastructure, Various Loca-
tions.
(d) LIMITS ON USE OF FUNDS.—None of the funds
authorized to be appropriated in subsection (c) may be
used for construction at any national security laboratory
221
as defined in section 3281(1) of the National Defense Au-
thorization Act for Fiscal Year 2000 (50 U.S.C. 2471(1))
or at any nuclear weapons production facility as defined
in section 3281(2) of the National Defense Authorization
Act for Fiscal Year 2000 (50 U.S.C. 2471(2)).
TITLE VI—MISCELLANEOUS
Subtitle A—General Provisions for
the Department of Energy
SEC. 2601. RESEARCH, DEVELOPMENT, DEMONSTRATION,
AND COMMERCIAL APPLICATION OF ENERGY
TECHNOLOGY PROGRAMS, PROJECTS, AND
ACTIVITIES.
(a) AUTHORIZED ACTIVITIES.—Except as otherwise
provided in this division, research, development, dem-
onstration, 
and 
commercial 
application 
programs,
projects, and activities for which appropriations are au-
thorized under this division may be carried out under the
procedures of the Federal Nonnuclear Energy Research
and Development Act of 1974 (42 U.S.C. 5901 et seq.),
the Atomic Energy Act of 1954 (42 U.S.C. 2011 et seq.),
or any other Act under which the Secretary is authorized
to carry out such programs, projects, and activities, but
only to the extent the Secretary is authorized to carry out
such activities under each such Act.
222
(b) AUTHORIZED AGREEMENTS.—Except as other-
wise provided in this division, in carrying out research,
development, demonstration, and commercial application
programs, projects, and activities for which appropriations
are authorized under this division, the Secretary may use,
to the extent authorized under applicable provisions of
law, contracts, cooperative agreements, cooperative re-
search and development agreements under the Stevenson-
Wydler Technology Innovation Act of 1980 (15 U.S.C.
3701 et seq.), grants, joint ventures, and any other form
of agreement available to the Secretary.
(c) DEFINITION.—For purposes of this section, the
term ‘‘joint venture’’ has the meaning given that term
under section 2 of the National Cooperative Research and
Production Act of 1993 (15 U.S.C. 4301), except that
such term may apply under this section to research, devel-
opment, demonstration, and commercial application of en-
ergy technology joint ventures.
(d) 
PROTECTION
OF
INFORMATION.—Section
12(c)(7) of the Stevenson-Wydler Technology Innovation
Act of 1980 (15 U.S.C. 3710a(c)(7)), relating to the pro-
tection of information, shall apply to research, develop-
ment, demonstration, and commercial application of en-
ergy technology programs, projects, and activities for
which appropriations are authorized under this division.
223
(e) INVENTIONS.—An invention conceived and devel-
oped by any person using funds provided through a grant
under this division shall be considered a subject invention
for the purposes of chapter 18 of title 35, United States
Code (commonly referred to as the Bayh-Dole Act).
(f) OUTREACH.—The Secretary shall ensure that
each program authorized by this division includes an out-
reach component to provide information, as appropriate,
to manufacturers, consumers, engineers, architects, build-
ers, energy service companies, universities, facility plan-
ners and managers, State and local governments, and
other entities.
(g) GUIDELINES AND PROCEDURES.—The Secretary
shall provide guidelines and procedures for the transition,
where appropriate, of energy technologies from research
through development and demonstration to commercial
application of energy technology. Nothing in this section
shall preclude the Secretary from—
(1) entering into a contract, cooperative agree-
ment, cooperative research and development agree-
ment under the Stevenson-Wydler Technology Inno-
vation Act of 1980 (15 U.S.C. 3701 et seq.), grant,
joint venture, or any other form of agreement avail-
able to the Secretary under this section that relates
224
to research, development, demonstration, and com-
mercial application of energy technology; or
(2) extending a contract, cooperative agree-
ment, cooperative research and development agree-
ment under the Stevenson-Wydler Technology Inno-
vation Act of 1980, grant, joint venture, or any
other form of agreement available to the Secretary
that relates to research, development, and dem-
onstration to cover commercial application of energy
technology.
(h) APPLICATION OF SECTION.—This section shall
not apply to any contract, cooperative agreement, coopera-
tive research and development agreement under the Ste-
venson-Wydler Technology Innovation Act of 1980 (15
U.S.C. 3701 et seq.), grant, joint venture, or any other
form of agreement available to the Secretary that is in
effect as of the date of enactment of this Act.
SEC. 2602. LIMITS ON USE OF FUNDS.
(a) MANAGEMENT AND OPERATING CONTRACTS.—
(1) 
COMPETITIVE
PROCEDURE
REQUIRE-
MENT.—None of the funds authorized to be appro-
priated to the Secretary by this division may be used
to award a management and operating contract for
a federally owned or operated nonmilitary energy
laboratory of the Department unless such contract is
225
awarded using competitive procedures or the Sec-
retary grants, on a case-by-case basis, a waiver to
allow for such a deviation. The Secretary may not
delegate the authority to grant such a waiver.
(2) CONGRESSIONAL
NOTICE.—At least 2
months before a contract award, amendment, or
modification for which the Secretary intends to
grant such a waiver, the Secretary shall submit to
the appropriate congressional committees a report
notifying the committees of the waiver and setting
forth the reasons for the waiver.
(b) PRODUCTION OR PROVISION OF ARTICLES OR
SERVICES.—None of the funds authorized to be appro-
priated to the Secretary by this division may be used to
produce or provide articles or services for the purpose of
selling the articles or services to a person outside the Fed-
eral Government, unless the Secretary determines that
comparable articles or services are not available from a
commercial source in the United States.
(c) REQUESTS FOR PROPOSALS.—None of the funds
authorized to be appropriated to the Secretary by this divi-
sion may be used by the Department to prepare or initiate
Requests for Proposals for a program if the program has
not been authorized by Congress.
226
SEC. 2603. COST SHARING.
(a) RESEARCH AND DEVELOPMENT.—Except as oth-
erwise provided in this division, for research and develop-
ment programs carried out under this division, the Sec-
retary shall require a commitment from non-Federal
sources of at least 20 percent of the cost of the project.
The Secretary may reduce or eliminate the non-Federal
requirement under this subsection if the Secretary deter-
mines that the research and development is of a basic or
fundamental nature.
(b) DEMONSTRATION
AND COMMERCIAL APPLICA-
TION.—Except as otherwise provided in this division, the
Secretary shall require at least 50 percent of the costs di-
rectly and specifically related to any demonstration or
commercial application project under this division to be
provided from non-Federal sources. The Secretary may re-
duce the non-Federal requirement under this subsection
if the Secretary determines that the reduction is necessary
and appropriate considering the technological risks in-
volved in the project and is necessary to meet the objec-
tives of this division.
(c) CALCULATION OF AMOUNT.—In calculating the
amount of the non-Federal commitment under subsection
(a) or (b), the Secretary may include personnel, services,
equipment, and other resources.
227
SEC. 2604. LIMITATION ON DEMONSTRATION AND COMMER-
CIAL 
APPLICATION 
OF 
ENERGY 
TECH-
NOLOGY.
Except as otherwise provided in this division, the Sec-
retary shall provide funding for scientific or energy dem-
onstration and commercial application of energy tech-
nology programs, projects, or activities only for tech-
nologies or processes that can be reasonably expected to
yield new, measurable benefits to the cost, efficiency, or
performance of the technology or process.
SEC. 2605. REPROGRAMMING.
(a) AUTHORITY.—The Secretary may use amounts
appropriated under this division for a program, project,
or activity other than the program, project, or activity for
which such amounts were appropriated only if—
(1) the Secretary has transmitted to the appro-
priate congressional committees a report described
in subsection (b) and a period of 30 days has
elapsed after such committees receive the report;
(2) amounts used for the program, project, or
activity do not exceed—
(A) 105 percent of the amount authorized
for the program, project, or activity; or
(B) $250,000 more than the amount au-
thorized for the program, project, or activity,
whichever is less; and
228
(3) the program, project, or activity has been
presented to, or requested of, the Congress by the
Secretary.
(b) REPORT.—(1) The report referred to in sub-
section (a) is a report containing a full and complete state-
ment of the action proposed to be taken and the facts and
circumstances relied upon in support of the proposed ac-
tion.
(2) In the computation of the 30-day period under
subsection (a), there shall be excluded any day on which
either House of Congress is not in session because of an
adjournment of more than 3 days to a day certain.
(c) LIMITATIONS.—(1) In no event may the total
amount of funds obligated by the Secretary pursuant to
this division exceed the total amount authorized to be ap-
propriated to the Secretary by this division.
(2) Funds appropriated to the Secretary pursuant to
this division may not be used for an item for which Con-
gress has declined to authorize funds.
Subtitle B—Other Miscellaneous
Provisions
SEC. 2611. NOTICE OF REORGANIZATION.
The Secretary shall provide notice to the appropriate
congressional committees not later than 15 days before
any reorganization of any environmental research or devel-
229
opment, scientific or energy research, development, or
demonstration, or commercial application of energy tech-
nology program, project, or activity of the Department.
SEC. 2612. LIMITS ON GENERAL PLANT PROJECTS.
If, at any time during the construction of a civilian
environmental research and development, scientific or en-
ergy research, development, or demonstration, or commer-
cial application of energy technology project of the Depart-
ment for which no specific funding level is provided by
law, the estimated cost (including any revision thereof) of
the project exceeds $5,000,000, the Secretary may not
continue such construction unless the Secretary has fur-
nished a complete report to the appropriate congressional
committees explaining the project and the reasons for the
estimate or revision.
SEC. 2613. LIMITS ON CONSTRUCTION PROJECTS.
(a) LIMITATION.—Except as provided in subsection
(b), construction on a civilian environmental research and
development, scientific or energy research, development, or
demonstration, or commercial application of energy tech-
nology project of the Department for which funding has
been specifically provided by law may not be started, and
additional obligations may not be incurred in connection
with the project above the authorized funding amount,
230
whenever the current estimated cost of the construction
project exceeds by more than 10 percent the higher of—
(1) the amount authorized for the project, if the
entire project has been funded by the Congress; or
(2) the amount of the total estimated cost for
the project as shown in the most recent budget jus-
tification data submitted to Congress.
(b) NOTICE.—An action described in subsection (a)
may be taken if—
(1) the Secretary has submitted to the appro-
priate congressional committees a report on the pro-
posed actions and the circumstances making such
actions necessary; and
(2) a period of 30 days has elapsed after the
date on which the report is received by the commit-
tees.
(c) EXCLUSION.—In the computation of the 30-day
period described in subsection (b)(2), there shall be ex-
cluded any day on which either House of Congress is not
in session because of an adjournment of more than 3 days
to a day certain.
(d) EXCEPTION.—Subsections (a) and (b) shall not
apply to any construction project that has a current esti-
mated cost of less than $5,000,000.
231
SEC. 2614. AUTHORITY FOR CONCEPTUAL AND CONSTRUC-
TION DESIGN.
(a) REQUIREMENT FOR CONCEPTUAL DESIGN.—(1)
Subject to paragraph (2) and except as provided in para-
graph (3), before submitting to Congress a request for
funds for a construction project that is in support of a
civilian environmental research and development, scientific
or energy research, development, or demonstration, or
commercial application of energy technology program,
project, or activity of the Department, the Secretary shall
complete a conceptual design for that project.
(2) If the estimated cost of completing a conceptual
design for a construction project exceeds $750,000, the
Secretary shall submit to Congress a request for funds for
the conceptual design before submitting a request for
funds for the construction project.
(3) The requirement in paragraph (1) does not apply
to a request for funds for a construction project, the total
estimated cost of which is less than $5,000,000.
(b) AUTHORITY FOR CONSTRUCTION DESIGN.—(1)
The Secretary may carry out construction design (includ-
ing architectural and engineering services) in connection
with any proposed construction project that is in support
of a civilian environmental research and development, sci-
entific or energy research, development, and demonstra-
tion, or commercial application of energy technology pro-
232
gram, project, or activity of the Department if the total
estimated cost for such design does not exceed $250,000.
(2) If the total estimated cost for construction design
in connection with any construction project described in
paragraph (1) exceeds $250,000, funds for such design
must be specifically authorized by law.
SEC. 2615. NATIONAL ENERGY POLICY DEVELOPMENT
GROUP MANDATED REPORTS.
(a) THE SECRETARY’S REVIEW OF ENERGY EFFI-
CIENCY RENEWABLE ENERGY, AND ALTERNATIVE EN-
ERGY RESEARCH AND DEVELOPMENT.—Upon completion
of the Secretary’s review of current funding and historic
performance of the Department’s energy efficiency, renew-
able energy, and alternative energy research and develop-
ment programs in response to the recommendations of the
May 16, 2001, Report of the National Energy Policy De-
velopment Group, the Secretary shall transmit a report
containing the results of such review to the appropriate
congressional committees.
(b) REVIEW AND RECOMMENDATIONS ON USING THE
NATION’S ENERGY RESOURCES MORE EFFICIENTLY.—
Upon completion of the Office of Science and Technology
Policy and the President’s Council of Advisors on Science
and Technology reviewing and making recommendations
on using the Nation’s energy resources more efficiently,
233
in response to the recommendation of the May 16, 2001,
Report of the National Energy Policy Development Group,
the Director of the Office of Science and Technology Pol-
icy shall transmit a report containing the results of such
review and recommendations to the appropriate congres-
sional committees.
SEC. 2616. PERIODIC REVIEWS AND ASSESSMENTS.
The Secretary shall enter into appropriate arrange-
ments with the National Academies of Sciences and Engi-
neering to ensure that there be periodic reviews and as-
sessments of the programs authorized by this division, as
well as the measurable cost and performance-based goals
for such programs as established under section 2004, and
the progress on meeting such goals. Such reviews and as-
sessments shall be conducted at least every 5 years, or
more often as the Secretary considers necessary, and the
Secretary shall transmit to the appropriate congressional
committees reports containing the results of such reviews
and assessments.
234
DIVISION C
SEC. 3001. SHORT TITLE.
(a) SHORT TITLE.—This division may be cited as the
‘‘Energy Tax Policy Act of 2001’’.
(b) AMENDMENT OF 1986 CODE.—Except as other-
wise expressly provided, whenever in this division an
amendment or repeal is expressed in terms of an amend-
ment to, or repeal of, a section or other provision, the ref-
erence shall be considered to be made to a section or other
provision of the Internal Revenue Code of 1986.
TITLE I—CONSERVATION
SEC. 3101. CREDIT FOR RESIDENTIAL SOLAR ENERGY
PROPERTY.
(a) IN GENERAL.—Subpart A of part IV of sub-
chapter A of chapter 1 (relating to nonrefundable personal
credits) is amended by inserting after section 25B the fol-
lowing new section:
‘‘SEC. 25C. RESIDENTIAL SOLAR ENERGY PROPERTY.
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in-
dividual, there shall be allowed as a credit against the tax
imposed by this chapter for the taxable year an amount
equal to the sum of—
‘‘(1) 15 percent of the qualified photovoltaic
property expenditures made by the taxpayer during
such year, and
235
‘‘(2) 15 percent of the qualified solar water
heating property expenditures made by the taxpayer
during the taxable year.
‘‘(b) LIMITATIONS.—
‘‘(1) MAXIMUM
CREDIT.—The credit allowed
under subsection (a) shall not exceed—
‘‘(A) $2,000 for each system of property
described in subsection (c)(1), and
‘‘(B) $2,000 for each system of property
described in subsection (c)(2).
‘‘(2) SAFETY CERTIFICATIONS.—No credit shall
be allowed under this section for an item of property
unless—
‘‘(A) in the case of solar water heating
equipment, such equipment is certified for per-
formance and safety by the non-profit Solar
Rating Certification Corporation or a com-
parable entity endorsed by the government of
the State in which such property is installed,
and
‘‘(B) in the case of a photovoltaic system,
such system meets appropriate fire and electric
code requirements.
236
‘‘(3) LIMITATION
BASED
ON
AMOUNT
OF
TAX.—The credit allowed under subsection (a) for
the taxable year shall not exceed the excess of—
‘‘(A) the sum of the regular tax liability
(as defined in section 26(b)) plus the tax im-
posed by section 55, over
‘‘(B) the sum of the credits allowable
under this subpart (other than this section and
sections 23, 25D, and 25E) and section 27 for
the taxable year.
‘‘(c) DEFINITIONS.—For purposes of this section—
‘‘(1) QUALIFIED SOLAR WATER HEATING PROP-
ERTY
EXPENDITURE.—The term ‘qualified solar
water heating property expenditure’ means an ex-
penditure for property to heat water for use in a
dwelling unit located in the United States and used
as a residence if at least half of the energy used by
such property for such purpose is derived from the
sun.
‘‘(2) QUALIFIED PHOTOVOLTAIC PROPERTY EX-
PENDITURE.—The term ‘qualified photovoltaic prop-
erty expenditure’ means an expenditure for property
that uses solar energy to generate electricity for use
in a dwelling unit.
237
‘‘(3) SOLAR PANELS.—No expenditure relating
to a solar panel or other property installed as a roof
(or portion thereof) shall fail to be treated as prop-
erty described in paragraph (1) or (2) solely because
it constitutes a structural component of the struc-
ture on which it is installed.
‘‘(4) LABOR
COSTS.—Expenditures for labor
costs properly allocable to the onsite preparation, as-
sembly, or original installation of the property de-
scribed in paragraph (1) or (2) and for piping or
wiring to interconnect such property to the dwelling
unit shall be taken into account for purposes of this
section.
‘‘(5) SWIMMING POOLS, ETC., USED AS STOR-
AGE MEDIUM.—Expenditures which are properly al-
locable to a swimming pool, hot tub, or any other
energy storage medium which has a function other
than the function of such storage shall not be taken
into account for purposes of this section.
‘‘(d) SPECIAL RULES.—
‘‘(1) DOLLAR AMOUNTS IN CASE OF JOINT OC-
CUPANCY.—In the case of any dwelling unit which is
jointly occupied and used during any calendar year
as a residence by 2 or more individuals the following
shall apply:
238
‘‘(A) The amount of the credit allowable
under subsection (a) by reason of expenditures
(as the case may be) made during such cal-
endar year by any of such individuals with re-
spect to such dwelling unit shall be determined
by treating all of such individuals as 1 taxpayer
whose taxable year is such calendar year.
‘‘(B) There shall be allowable with respect
to such expenditures to each of such individ-
uals, a credit under subsection (a) for the tax-
able year in which such calendar year ends in
an amount which bears the same ratio to the
amount determined under subparagraph (A) as
the amount of such expenditures made by such
individual during such calendar year bears to
the aggregate of such expenditures made by all
of such individuals during such calendar year.
‘‘(2) TENANT-STOCKHOLDER IN COOPERATIVE
HOUSING CORPORATION.—In the case of an indi-
vidual who is a tenant-stockholder (as defined in sec-
tion 216) in a cooperative housing corporation (as
defined in such section), such individual shall be
treated as having made his tenant-stockholder’s pro-
portionate share (as defined in section 216(b)(3)) of
any expenditures of such corporation.
239
‘‘(3) CONDOMINIUMS.—
‘‘(A) IN GENERAL.—In the case of an indi-
vidual who is a member of a condominium man-
agement association with respect to a condo-
minium which he owns, such individual shall be
treated as having made his proportionate share
of any expenditures of such association.
‘‘(B) CONDOMINIUM
MANAGEMENT
ASSO-
CIATION.—For purposes of this paragraph, the
term ‘condominium management association’
means an organization which meets the require-
ments of paragraph (1) of section 528(c) (other
than subparagraph (E) thereof) with respect to
a condominium project substantially all of the
units of which are used as residences.
‘‘(4) ALLOCATION IN CERTAIN CASES.—If less
than 80 percent of the use of an item is for nonbusi-
ness purposes, only that portion of the expenditures
for such item which is properly allocable to use for
nonbusiness purposes shall be taken into account.
‘‘(5) WHEN EXPENDITURE MADE; AMOUNT OF
EXPENDITURE.—
‘‘(A) IN GENERAL.—Except as provided in
subparagraph (B), an expenditure with respect
240
to an item shall be treated as made when the
original installation of the item is completed.
‘‘(B) EXPENDITURES PART OF BUILDING
CONSTRUCTION.—In the case of an expenditure
in connection with the construction or recon-
struction of a structure, such expenditure shall
be treated as made when the original use of the
constructed or reconstructed structure by the
taxpayer begins.
‘‘(C) AMOUNT.—The amount of any ex-
penditure shall be the cost thereof.
‘‘(6) PROPERTY FINANCED BY SUBSIDIZED EN-
ERGY FINANCING.—For purposes of determining the
amount of expenditures made by any individual with
respect to any dwelling unit, there shall not be taken
in to account expenditures which are made from
subsidized energy financing (as defined in section
48(a)(4)(A)).
‘‘(e) BASIS ADJUSTMENTS.—For purposes of this
subtitle, if a credit is allowed under this section for any
expenditure with respect to any property, the increase in
the basis of such property which would (but for this sub-
section) result from such expenditure shall be reduced by
the amount of the credit so allowed.
241
‘‘(f) TERMINATION.—The credit allowed under this
section shall not apply to taxable years beginning after
December 31, 2006 (December 31, 2008, with respect to
qualified photovoltaic property expenditures).’’.
(b) CONFORMING AMENDMENTS.—
(1) Subsection (a) of section 1016 is amended
by striking ‘‘and’’ at the end of paragraph (27), by
striking the period at the end of paragraph (28) and
inserting ‘‘, and’’, and by adding at the end the fol-
lowing new paragraph:
‘‘(29) to the extent provided in section 25C(e),
in the case of amounts with respect to which a credit
has been allowed under section 25C.’’.
(2) The table of sections for subpart A of part
IV of subchapter A of chapter 1 is amended by in-
serting after the item relating to section 25B the fol-
lowing new item:
‘‘Sec. 25C. Residential solar energy property.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years ending after De-
cember 31, 2001.
SEC. 3102. EXTENSION AND EXPANSION OF CREDIT FOR
ELECTRICITY PRODUCED FROM RENEWABLE
RESOURCES.
(a) EXTENSION OF CREDIT FOR WIND AND CLOSED-
LOOP BIOMASS FACILITIES.—Subparagraphs (A) and (B)
242
of section 45(c)(3) are each amended by striking ‘‘2002’’
and inserting ‘‘2007’’.
(b) EXPANSION OF CREDIT FOR OPEN-LOOP BIOMASS
AND LANDFILL GAS FACILITIES.—Paragraph (3) of sec-
tion 45(c) is amended by adding at the end the following
new subparagraphs:
‘‘(D) OPEN-LOOP BIOMASS FACILITIES.—
In the case of a facility using open-loop biomass
to produce electricity, the term ‘qualified facil-
ity’ means any facility owned by the taxpayer
which is originally placed in service before Jan-
uary 1, 2007.
‘‘(E) LANDFILL GAS FACILITIES.—In the
case of a facility producing electricity from gas
derived from the biodegradation of municipal
solid waste, the term ‘qualified facility’ means
any facility owned by the taxpayer which is
originally placed in service before January 1,
2007.’’.
(c) DEFINITION AND SPECIAL RULES.—Subsection
(c) of section 45 is amended by adding at the end the
following new paragraphs:
‘‘(5) OPEN-LOOP
BIOMASS.—The term ‘open-
loop biomass’ means any solid, nonhazardous, cel-
243
lulosic waste material which is segregated from other
waste materials and which is derived from—
‘‘(A) any of the following forest-related re-
sources: mill residues, precommercial thinnings,
slash, and brush, but not including old-growth
timber,
‘‘(B) solid wood waste materials, including
waste pallets, crates, dunnage, manufacturing
and construction wood wastes (other than pres-
sure-treated, 
chemically-treated, 
or 
painted
wood wastes), and landscape or right-of-way
tree trimmings, but not including municipal
solid waste (garbage), gas derived from the bio-
degradation of solid waste, or paper that is
commonly recycled, or
‘‘(C) agriculture sources, including orchard
tree crops, vineyard, grain, legumes, sugar, and
other crop by-products or residues.
Such term shall not include closed-loop biomass.
‘‘(6) 
REDUCED
CREDIT
FOR
CERTAIN
PREEFFECTIVE DATE FACILITIES.—In the case of
any facility described in subparagraph (D) or (E) of
paragraph (3) which is placed in service before the
date of the enactment of this subparagraph—
244
‘‘(A) subsection (a)(1) shall be applied by
substituting ‘1.0 cents’ for ‘1.5 cents’, and
‘‘(B) the 5-year period beginning on the
date of the enactment of this paragraph shall
be substituted in lieu of the 10-year period in
subsection (a)(2)(A)(ii).
‘‘(7) LIMIT ON REDUCTIONS FOR GRANTS, ETC.,
FOR
OPEN-LOOP
BIOMASS
FACILITIES.—If 
the
amount of the credit determined under subsection
(a) with respect to any open-loop biomass facility is
required to be reduced under paragraph (3) of sub-
section (b), the fraction under such paragraph shall
in no event be greater than 4⁄5.
‘‘(8) COORDINATION
WITH
SECTION
29.—The
term ‘qualified facility’ shall not include any facility
the production from which is allowed as a credit
under section 29 for the taxable year or any prior
taxable year.’’.
(d) EFFECTIVE DATE.—The amendments made by
this section shall apply to electricity sold after the date
of the enactment of this Act.
SEC. 3103. CREDIT FOR QUALIFIED STATIONARY FUEL
CELL POWERPLANTS.
(a) BUSINESS PROPERTY.—
245
(1) IN GENERAL.—Subparagraph (A) of section
48(a)(3) (defining energy property) is amended by
striking ‘‘or’’ at the end of clause (i), by adding
‘‘or’’ at the end of clause (ii), and by inserting after
clause (ii) the following new clause:
‘‘(iii) equipment which is part of a
qualified stationary fuel cell powerplant,’’.
(2) QUALIFIED STATIONARY FUEL CELL POW-
ERPLANT.—Subsection (a) of section 48 is amended
by redesignating paragraphs (4) and (5) as para-
graphs (5) and (6), respectively, and by inserting
after paragraph (3) the following new paragraph:
‘‘(4) QUALIFIED STATIONARY FUEL CELL POW-
ERPLANT.—For purposes of this subsection—
‘‘(A) IN
GENERAL.—The term ‘qualified
stationary fuel cell powerplant’ means a sta-
tionary fuel cell power plant that has an elec-
tricity-only generation efficiency greater than
30 percent.
‘‘(B) LIMITATION.—In the case of quali-
fied stationary fuel cell powerplant placed in
service during the taxable year, the credit under
subsection (a) for such year may not exceed
$1,000 for each kilowatt of capacity.
246
‘‘(C) STATIONARY
FUEL
CELL
POWER
PLANT.—The term ‘stationary fuel cell power
plant’ means an integrated system comprised of
a fuel cell stack assembly and associated bal-
ance of plant components that converts a fuel
into electricity using electrochemical means.
‘‘(D) TERMINATION.—Such term shall not
include any property placed in service after De-
cember 31, 2006.’’
(3) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to property placed in
service after December 31, 2001, under rules similar
to the rules of section 48(m) of the Internal Revenue
Code of 1986 (as in effect on the day before the
date of the enactment of the Revenue Reconciliation
Act of 1990).
(b) NONBUSINESS PROPERTY.—
(1) IN GENERAL.—Subpart A of part IV of sub-
chapter A of chapter 1 (relating to nonrefundable
personal credits) is amended by inserting after sec-
tion 25C the following new section:
‘‘SEC. 25D. NONBUSINESS QUALIFIED STATIONARY FUEL
CELL POWERPLANT.
‘‘(a) IN GENERAL.—In the case of an individual,
there shall be allowed as a credit against the tax imposed
247
by this chapter for the taxable year an amount equal to
10 percent of the qualified stationary fuel cell powerplant
expenditures which are paid or incurred during such year.
‘‘(b) LIMITATIONS.—
‘‘(1) IN GENERAL.—The credit allowed under
subsection (a) for the taxable year and all prior tax-
able years shall not exceed $1,000 for each kilowatt
of capacity.
‘‘(2) LIMITATION
BASED
ON
AMOUNT
OF
TAX.—The credit allowed under subsection (a) for
the taxable year shall not exceed the excess of—
‘‘(A) the sum of the regular tax liability
(as defined in section 26(b)) plus the tax im-
posed by section 55, over
‘‘(B) the sum of the credits allowable
under this subpart (other than this section and
sections 23 and 25E) and section 27 for the
taxable year.
‘‘(c) QUALIFIED STATIONARY FUEL CELL POWER-
PLANT EXPENDITURES.—For purposes of this section, the
term ‘qualified stationary fuel cell powerplant expendi-
tures’ means expenditures by the taxpayer for any quali-
fied stationary fuel cell powerplant (as defined in section
48(a)(4))—
248
‘‘(1) which meets the requirements of subpara-
graphs (B) and (D) of section 48(a)(3), and
‘‘(2) which is installed on or in connection with
a dwelling unit—
‘‘(A) which is located in the United States,
and
‘‘(B) which is used by the taxpayer as a
residence.
Such term includes expenditures for labor costs properly
allocable to the onsite preparation, assembly, or original
installation of the property.
‘‘(d) SPECIAL RULES.—For purposes of this section,
rules similar to the rules of section 25C(d) shall apply.
‘‘(e) BASIS ADJUSTMENTS.—For purposes of this
subtitle, if a credit is allowed under this section for any
expenditure with respect to any property, the increase in
the basis of such property which would (but for this sub-
section) result from such expenditure shall be reduced by
the amount of the credit so allowed.
‘‘(f) TERMINATION.—This section shall not apply to
any expenditure made after December 31, 2006.’’.
(2) CONFORMING AMENDMENTS.—
(A) Subsection (a) of section 1016 is
amended by striking ‘‘and’’ at the end of para-
graph (28), by striking the period at the end of
249
paragraph (29) and inserting ‘‘, and’’, and by
adding at the end the following new paragraph:
‘‘(30) to the extent provided in section 25D(e),
in the case of amounts with respect to which a credit
has been allowed under section 25D.’’.
(B) The table of sections for subpart A of
part IV of subchapter A of chapter 1 is amend-
ed by inserting after the item relating to section
25C the following new item:
‘‘Sec. 25D. Nonbusiness qualified stationary fuel cell power-
plant.’’.
(3) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to expenditures paid
or incurred after December 31, 2001.
SEC. 3104. ALTERNATIVE MOTOR VEHICLE CREDIT.
(a) IN GENERAL.—Subpart B of part IV of sub-
chapter A of chapter 1 (relating to foreign tax credit, etc.)
is amended by adding at the end the following:
‘‘SEC. 30B. ALTERNATIVE MOTOR VEHICLE CREDIT.
‘‘(a) ALLOWANCE OF CREDIT.—There shall be al-
lowed as a credit against the tax imposed by this chapter
for the taxable year an amount equal to the sum of—
‘‘(1) the new qualified fuel cell motor vehicle
credit determined under subsection (b),
‘‘(2) the new qualified hybrid motor vehicle
credit determined under subsection (c),
250
‘‘(3) the new qualified alternative fuel motor ve-
hicle credit determined under subsection (d), and
‘‘(4) the advanced lean burn technology motor
vehicle credit determined under subsection (e).
‘‘(b) NEW QUALIFIED FUEL CELL MOTOR VEHICLE
CREDIT.—
‘‘(1) IN GENERAL.—For purposes of subsection
(a), the new qualified fuel cell motor vehicle credit
determined under this subsection with respect to a
new qualified fuel cell motor vehicle placed in service
by the taxpayer during the taxable year is—
‘‘(A) $4,000, if such vehicle has a gross ve-
hicle weight rating of not more than 8,500
pounds,
‘‘(B) $10,000, if such vehicle has a gross
vehicle weight rating of more than 8,500
pounds but not more than 14,000 pounds,
‘‘(C) $20,000, if such vehicle has a gross
vehicle weight rating of more than 14,000
pounds but not more than 26,000 pounds, and
‘‘(D) $40,000, if such vehicle has a gross
vehicle weight rating of more than 26,000
pounds.
‘‘(2) INCREASE FOR FUEL EFFICIENCY.—
251
‘‘(A) IN
GENERAL.—The amount deter-
mined under paragraph (1)(A) with respect to
a new qualified fuel cell motor vehicle which is
a passenger automobile or light truck shall be
increased by—
‘‘(i) $1,000, if such vehicle achieves at
least 150 percent but less than 175 per-
cent of the 2000 model year city fuel econ-
omy,
‘‘(ii) $1,500, if such vehicle achieves
at least 175 percent but less than 200 per-
cent of the 2000 model year city fuel econ-
omy,
‘‘(iii) $2,000, if such vehicle achieves
at least 200 percent but less than 225 per-
cent of the 2000 model year city fuel econ-
omy,
‘‘(iv) $2,500, if such vehicle achieves
at least 225 percent but less than 250 per-
cent of the 2000 model year city fuel econ-
omy,
‘‘(v) $3,000, if such vehicle achieves
at least 250 percent but less than 275 per-
cent of the 2000 model year city fuel econ-
omy,
252
‘‘(vi) $3,500, if such vehicle achieves
at least 275 percent but less than 300 per-
cent of the 2000 model year city fuel econ-
omy, and
‘‘(vii) $4,000, if such vehicle achieves
at least 300 percent of the 2000 model
year city fuel economy.
‘‘(B) 2000 MODEL YEAR CITY FUEL ECON-
OMY.—For purposes of subparagraph (A), the
2000 model year city fuel economy with respect
to a vehicle shall be determined in accordance
with the following tables:
‘‘(i) In the case of a passenger auto-
mobile:
‘‘If 
vehicle 
inertia 
weight
class is:
The 2000 model year city fuel
economy is:
1,500 or 1,750 lbs ....................................................................
43.7 mpg
2,000 lbs ..................................................................................
38.3 mpg
2,250 lbs ..................................................................................
34.1 mpg
2,500 lbs ..................................................................................
30.7 mpg
2,750 lbs ..................................................................................
27.9 mpg
3,000 lbs ..................................................................................
25.6 mpg
3,500 lbs ..................................................................................
22.0 mpg
4,000 lbs ..................................................................................
19.3 mpg
4,500 lbs ..................................................................................
17.2 mpg
5,000 lbs ..................................................................................
15.5 mpg
5,500 lbs ..................................................................................
14.1 mpg
6,000 lbs ..................................................................................
12.9 mpg
6,500 lbs ..................................................................................
11.9 mpg
7,000 or 8,500 lbs ....................................................................
11.1 mpg.
‘‘(ii) In the case of a light truck:
‘‘If 
vehicle 
inertia 
weight
class is:
The 2000 model year city fuel
economy is:
1,500 or 1,750 lbs ....................................................................
37.6 mpg
2,000 lbs ..................................................................................
33.7 mpg
2,250 lbs ..................................................................................
30.6 mpg
2,500 lbs ..................................................................................
28.0 mpg
253
‘‘If 
vehicle 
inertia 
weight
class is:
The 2000 model year city fuel
economy is:
2,750 lbs ..................................................................................
25.9 mpg
3,000 lbs ..................................................................................
24.1 mpg
3,500 lbs ..................................................................................
21.3 mpg
4,000 lbs ..................................................................................
19.0 mpg
4,500 lbs ..................................................................................
17.3 mpg
5,000 lbs ..................................................................................
15.8 mpg
5,500 lbs ..................................................................................
14.6 mpg
6,000 lbs ..................................................................................
13.6 mpg
6,500 lbs ..................................................................................
12.8 mpg
7,000 or 8,500 lbs ....................................................................
12.0 mpg.
‘‘(C) VEHICLE INERTIA WEIGHT CLASS.—
For purposes of subparagraph (B), the term
‘vehicle inertia weight class’ has the same
meaning as when defined in regulations pre-
scribed by the Administrator of the Environ-
mental Protection Agency for purposes of the
administration of title II of the Clean Air Act
(42 U.S.C. 7521 et seq.).
‘‘(3) NEW QUALIFIED FUEL CELL MOTOR VEHI-
CLE.—For purposes of this subsection, the term
‘new qualified fuel cell motor vehicle’ means a motor
vehicle—
‘‘(A) which is propelled by power derived
from one or more cells which convert chemical
energy directly into electricity by combining ox-
ygen with hydrogen fuel which is stored on
board the vehicle in any form and may or may
not require reformation prior to use,
‘‘(B) which, in the case of a passenger
automobile or light truck—
254
‘‘(i) for 2002 and later model vehicles,
has received a certificate of conformity
under the Clean Air Act and meets or ex-
ceeds the equivalent qualifying California
low emission vehicle standard under sec-
tion 243(e)(2) of the Clean Air Act for
that make and model year, and
‘‘(ii) for 2004 and later model vehi-
cles, has received a certificate that such ve-
hicle meets or exceeds the Tier II emission
level established in regulations prescribed
by the Administrator of the Environmental
Protection Agency under section 202(i) of
the Clean Air Act for that make and model
year vehicle,
‘‘(C) the original use of which commences
with the taxpayer,
‘‘(D) which is acquired for use or lease by
the taxpayer and not for resale, and
‘‘(E) which is made by a manufacturer.
‘‘(c) NEW QUALIFIED HYBRID MOTOR VEHICLE
CREDIT.—
‘‘(1) IN GENERAL.—For purposes of subsection
(a), the new qualified hybrid motor vehicle credit de-
termined under this subsection with respect to a new
255
qualified hybrid motor vehicle placed in service by
the taxpayer during the taxable year is the credit
amount determined under paragraph (2).
‘‘(2) CREDIT AMOUNT.—
‘‘(A) IN GENERAL.—The credit amount de-
termined under this paragraph shall be deter-
mined in accordance with the following tables:
‘‘(i) In the case of a new qualified hy-
brid motor vehicle which is a passenger
automobile or light truck and which pro-
vides the following percentage of the max-
imum available power:
‘‘If percentage of the max-
imum available power is:
The credit amount is:
At least 2.5 percent but less than 10 percent .........................
$250
At least 10 percent but less than 20 percent ..........................
$500
At least 20 percent but less than 30 percent ..........................
$750
At least 30 percent ..................................................................
$1,000.
‘‘(ii) In the case of a new qualified hy-
brid motor vehicle which is a heavy duty
hybrid motor vehicle and which provides
the following percentage of the maximum
available power:
‘‘(I) If such vehicle has a gross
vehicle weight rating of not more than
14,000 pounds:
‘‘If percentage of the max-
imum available power is:
The credit amount is:
At least 20 percent but less than 30 percent ..........................
$1,500
At least 30 percent but less than 40 percent ..........................
$1,750
At least 40 percent but less than 50 percent ..........................
$2,000
256
‘‘If percentage of the max-
imum available power is:
The credit amount is:
At least 50 percent but less than 60 percent ..........................
$2,250
At least 60 percent ..................................................................
$2,500.
‘‘(II) If such vehicle has a gross
vehicle weight rating of more than
14,000 but not more than 26,000
pounds:
‘‘If percentage of the max-
imum available power is:
The credit amount is:
At least 20 percent but less than 30 percent ..........................
$4,000
At least 30 percent but less than 40 percent ..........................
$4,500
At least 40 percent but less than 50 percent ..........................
$5,000
At least 50 percent but less than 60 percent ..........................
$5,500
At least 60 percent ..................................................................
$6,000.
‘‘(III) If such vehicle has a gross
vehicle weight rating of more than
26,000 pounds:
‘‘If percentage of the max-
imum available power is:
The credit amount is:
At least 20 percent but less than 30 percent ..........................
$6,000
At least 30 percent but less than 40 percent ..........................
$7,000
At least 40 percent but less than 50 percent ..........................
$8,000
At least 50 percent but less than 60 percent ..........................
$9,000
At least 60 percent ..................................................................
$10,000.
‘‘(B) INCREASE FOR FUEL EFFICIENCY.—
‘‘(i) AMOUNT.—The amount deter-
mined under subparagraph (A)(i) with re-
spect to a passenger automobile or light
truck shall be increased by—
‘‘(I) $1,000, if such vehicle
achieves at least 125 percent but less
than 150 percent of the 2000 model
year city fuel economy,
257
‘‘(II) $1,500, if such vehicle
achieves at least 150 percent but less
than 175 percent of the 2000 model
year city fuel economy,
‘‘(III) $2,000, if such vehicle
achieves at least 175 percent but less
than 200 percent of the 2000 model
year city fuel economy,
‘‘(IV) $2,500, if such vehicle
achieves at least 200 percent but less
than 225 percent of the 2000 model
year city fuel economy,
‘‘(V) $3,000, if such vehicle
achieves at least 225 percent but less
than 250 percent of the 2000 model
year city fuel economy, and
‘‘(VI) $3,500, if such vehicle
achieves at least 250 percent of the
2000 model year city fuel economy.
‘‘(ii) 2000 MODEL YEAR CITY FUEL
ECONOMY.—For purposes of clause (i), the
2000 model year city fuel economy with re-
spect to a vehicle shall be determined using
the tables provided in subsection (b)(2)(B)
with respect to such vehicle.
258
‘‘(iii) OPTION
TO
USE
LIKE
VEHI-
CLE.—For purposes of clause (i), at the
option of the vehicle manufacturer, the in-
crease for fuel efficiency may be calculated
by comparing the new qualified hybrid
motor vehicle to a ‘like vehicle’.
‘‘(C) INCREASE FOR ACCELERATED EMIS-
SIONS
PERFORMANCE.—The amount deter-
mined under subparagraph (A)(ii) with respect
to an applicable heavy duty hybrid motor vehi-
cle shall be increased by the increase credit
amount determined in accordance with the fol-
lowing tables:
‘‘(i) In the case of a vehicle which has
a gross vehicle weight rating of not more
than 14,000 pounds:
‘‘If the model year is:
The increase credit amount is:
2002 .........................................................................................
$3,500
2003 .........................................................................................
$3,000
2004 .........................................................................................
$2,500
2005 .........................................................................................
$2,000
2006 .........................................................................................
$1,500.
‘‘(ii) In the case of a vehicle which
has a gross vehicle weight rating of more
than 14,000 pounds but not more than
26,000 pounds:
‘‘If the model year is:
The increase credit amount is:
2002 .........................................................................................
$9,000
2003 .........................................................................................
$7,750
2004 .........................................................................................
$6,500
265
‘‘(A) 50 percent, plus
‘‘(B) 30 percent, if such vehicle—
‘‘(i) has received a certificate of con-
formity under the Clean Air Act and meets
or exceeds the most stringent standard
available for certification under the Clean
Air Act for that make and model year vehi-
cle (other than a zero emission standard),
or
‘‘(ii) has received an order from an
applicable State certifying the vehicle for
sale or lease in California and meets or ex-
ceeds the most stringent standard available
for certification under the State laws of
California (enacted in accordance with a
waiver granted under section 209(b) of the
Clean Air Act) for that make and model
year vehicle (other than a zero emission
standard).
‘‘(3) INCREMENTAL
COST.—For purposes of
this subsection, the incremental cost of any new
qualified alternative fuel motor vehicle is equal to
the amount of the excess of the manufacturer’s sug-
gested retail price for such vehicle over such price
for a gasoline or diesel fuel motor vehicle of the