115 
‘‘(2) BIOBASED
FUEL.—The term ‘biobased 
fuel’ means any transportation or heating fuel pro-
duced from biomass. 
‘‘(3) BIOBASED PRODUCT.—The term ‘biobased 
product’ means an industrial product (including 
chemicals, materials, and polymers) produced from 
biomass, or a commercial or industrial product (in-
cluding animal feed and electric power) derived in 
connection with the conversion of biomass to fuel. 
‘‘(4) BIOMASS.—The term ‘biomass’ means any 
organic matter that is available on a renewable or 
recurring basis, including agricultural crops and 
trees, wood and wood wastes and residues, plants 
(including aquatic plants), grasses, residues, fibers, 
and animal wastes, municipal wastes, and other 
waste materials. 
‘‘(5) BOARD.—The term ‘Board’ means the 
Biomass Research and Development Board estab-
lished by this section. 
‘‘(6) DEMONSTRATION.—The term ‘demonstra-
tion’ means demonstration of technology in a pilot 
plant or semi-works scale facility. 
‘‘(7) INITIATIVE.—The term ‘Initiative’ means 
the Biomass Research and Development Initiative 
established under this section. 
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‘‘(8) INSTITUTION OF HIGHER EDUCATION.— 
The term ‘institution of higher education’ has the 
meaning given the term in section 102(a) of the 
Higher Education Act of 1965 (20 U.S.C. 1002(a)). 
‘‘(9) NATIONAL LABORATORY.—The term ‘Na-
tional Laboratory’ has the meaning given that term 
in section 2 of the Energy Policy Act of 2005. 
‘‘(10) POINT OF CONTACT.—The term ‘point of 
contact’ means a point of contact designated under 
this section. 
‘‘(d) COOPERATION AND COORDINATION IN BIOMASS 
RESEARCH AND DEVELOPMENT.— 
‘‘(1) IN
GENERAL.—The Secretary of Agri-
culture and the Secretary of Energy shall cooperate 
with respect to, and coordinate, policies and proce-
dures that promote research and development lead-
ing to the production of biobased fuels and biobased 
products. 
‘‘(2) POINTS OF CONTACT.— 
‘‘(A) IN
GENERAL.—To coordinate re-
search and development programs and activities 
relating to biobased fuels and biobased products 
that are carried out by their respective Depart-
ments— 
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‘‘(i) the Secretary of Agriculture shall 
designate, as the point of contact for the 
Department of Agriculture, an officer of 
the Department of Agriculture appointed 
by the President to a position in the De-
partment before the date of the designa-
tion, by and with the advice and consent of 
the Senate; and 
‘‘(ii) the Secretary of Energy shall 
designate, as the point of contact for the 
Department of Energy, an officer of the 
Department of Energy appointed by the 
President to a position in the Department 
before the date of the designation, by and 
with the advice and consent of the Senate. 
‘‘(B) DUTIES.—The points of contact shall 
jointly— 
‘‘(i) assist in arranging interlabora-
tory and site-specific supplemental agree-
ments 
for 
research 
and 
development 
projects relating to biobased fuels and 
biobased products; 
‘‘(ii) serve as cochairpersons of the 
Board; 
‘‘(iii) administer the Initiative; and 
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‘‘(iv) respond in writing to each rec-
ommendation of the Advisory Committee 
made under subsection (f). 
‘‘(e) BIOMASS
RESEARCH
AND
DEVELOPMENT 
BOARD.— 
‘‘(1) ESTABLISHMENT.—There is established 
the Biomass Research and Development Board, 
which shall supersede the Interagency Council on 
Biobased Products and Bioenergy established by Ex-
ecutive Order No. 13134, to coordinate programs 
within and among departments and agencies of the 
Federal Government for the purpose of promoting 
the use of biobased fuels and biobased products by— 
‘‘(A) maximizing the benefits deriving from 
Federal grants and assistance; and 
‘‘(B) bringing coherence to Federal stra-
tegic planning. 
‘‘(2) MEMBERSHIP.—The Board shall consist 
of— 
‘‘(A) the point of contact of the Depart-
ment of Energy designated under subsection 
(d), who shall serve as cochairperson of the 
Board; 
‘‘(B) the point of contact of the Depart-
ment of Agriculture designated under sub-
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section (d), who shall serve as cochairperson of 
the Board; 
‘‘(C) a senior officer of each of the Depart-
ment of the Interior, the Environmental Protec-
tion Agency, the National Science Foundation, 
and the Office of Science and Technology Pol-
icy, each of whom shall— 
‘‘(i) be appointed by the head of the 
respective agency; and 
‘‘(ii) have a rank that is equivalent to 
the rank of the points of contact; and 
‘‘(D) at the option of the Secretary of Ag-
riculture and the Secretary of Energy, other 
members appointed by the Secretaries (after 
consultation with the members described in sub-
paragraphs (A) through (C)). 
‘‘(3) DUTIES.—The Board shall— 
‘‘(A) coordinate research and development 
activities relating to biobased fuels and biobased 
products— 
‘‘(i) between the Department of Agri-
culture and the Department of Energy; 
and 
‘‘(ii) with other departments and 
agencies of the Federal Government; 
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‘‘(B) provide recommendations to the 
points of contact concerning administration of 
this title; 
‘‘(C) ensure that— 
‘‘(i) solicitations are open and com-
petitive with awards made annually; and 
‘‘(ii) objectives and evaluation criteria 
of the solicitations are clearly stated and 
minimally prescriptive, with no areas of 
special interest; and 
‘‘(D) ensure that the panel of scientific 
and technical peers assembled under subsection 
(g) to review proposals is composed predomi-
nantly of independent experts selected from out-
side the Departments of Agriculture and En-
ergy. 
‘‘(4) FUNDING.—Each agency represented on 
the Board is encouraged to provide funds for any 
purpose under this section. 
‘‘(5) MEETINGS.—The Board shall meet at 
least quarterly to enable the Board to carry out the 
duties of the Board under paragraph (3). 
‘‘(f) BIOMASS RESEARCH AND DEVELOPMENT TECH-
NICAL ADVISORY COMMITTEE.— 
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‘‘(1) ESTABLISHMENT.—There is established 
the Biomass Research and Development Technical 
Advisory Committee, which shall supersede the Advi-
sory Committee on Biobased Products and Bio-
energy established by Executive Order No. 13134— 
‘‘(A) to advise the Secretary of Energy, the 
Secretary of Agriculture, and the points of con-
tact concerning— 
‘‘(i) the technical focus and direction 
of requests for proposals issued under the 
Initiative; and 
‘‘(ii) procedures for reviewing and 
evaluating the proposals; 
‘‘(B) to facilitate consultations and part-
nerships among Federal and State agencies, ag-
ricultural producers, industry, consumers, the 
research community, and other interested 
groups to carry out program activities relating 
to the Initiative; and 
‘‘(C) to evaluate and perform strategic 
planning on program activities relating to the 
Initiative. 
‘‘(2) MEMBERSHIP.— 
‘‘(A) IN
GENERAL.—The Advisory Com-
mittee shall consist of— 
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‘‘(i) an individual affiliated with the 
biofuels industry; 
‘‘(ii) an individual affiliated with the 
biobased industrial and commercial prod-
ucts industry; 
‘‘(iii) an individual affiliated with an 
institution of higher education who has ex-
pertise in biobased fuels and biobased 
products; 
‘‘(iv) two prominent engineers or sci-
entists from government or academia who 
have expertise in biobased fuels and 
biobased products; 
‘‘(v) an individual affiliated with a 
commodity trade association; 
‘‘(vi) 2 individuals affiliated with an 
environmental or conservation organiza-
tion; 
‘‘(vii) an individual associated with 
State government who has expertise in 
biobased fuels and biobased products; 
‘‘(viii) an individual with expertise in 
energy and environmental analysis; 
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‘‘(ix) an individual with expertise in 
the economics of biobased fuels and 
biobased products; 
‘‘(x) an individual with expertise in 
agricultural economics; 
‘‘(xi) an individual with expertise in 
agronomy, crop science, or soil science; and 
‘‘(xii) at the option of the points of 
contact, other members. 
‘‘(B) APPOINTMENT.—The members of the 
Advisory Committee shall be appointed by the 
points of contact. 
‘‘(3) 
DUTIES.—The 
Advisory 
Committee 
shall— 
‘‘(A) advise the points of contact with re-
spect to the Initiative; and 
‘‘(B) evaluate whether, and make rec-
ommendations in writing to the Board to en-
sure that— 
‘‘(i) funds authorized for the Initiative 
are distributed and used in a manner that 
is consistent with the objectives, purposes, 
and considerations of the Initiative; 
‘‘(ii) solicitations are open and com-
petitive with awards made annually and 
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that objectives and evaluation criteria of 
the solicitations are clearly stated and 
minimally prescriptive, with no areas of 
special interest; 
‘‘(iii) the points of contact are funding 
proposals under this title that are selected 
on the basis of merit, as determined by an 
independent panel of scientific and tech-
nical peers predominantly from outside the 
Departments of Agriculture and Energy; 
and 
‘‘(iv) activities under this section are 
carried out in accordance with this section. 
‘‘(4) COORDINATION.—To avoid duplication of 
effort, the Advisory Committee shall coordinate its 
activities with those of other Federal advisory com-
mittees working in related areas. 
‘‘(5) MEETINGS.—The Advisory Committee 
shall meet at least quarterly to enable the Advisory 
Committee to carry out the duties of the Advisory 
Committee. 
‘‘(6) TERMS.—Members of the Advisory Com-
mittee shall be appointed for a term of 3 years, ex-
cept that— 
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‘‘(A) one-third of the members initially ap-
pointed shall be appointed for a term of 1 year; 
and 
‘‘(B) one-third of the members initially ap-
pointed shall be appointed for a term of 2 
years. 
‘‘(g) BIOMASS RESEARCH AND DEVELOPMENT INI-
TIATIVE.— 
‘‘(1) IN
GENERAL.—The Secretary of Agri-
culture and the Secretary of Energy, acting through 
their respective points of contact and in consultation 
with the Board, shall establish and carry out a Bio-
mass Research and Development Initiative under 
which competitively awarded grants, contracts, and 
financial assistance are provided to, or entered into 
with, eligible entities to carry out research on, and 
development and demonstration of, biobased fuels 
and biobased products, and the methods, practices 
and technologies, for their production. 
‘‘(2) OBJECTIVES.—The objectives of the Initia-
tive are to develop— 
‘‘(A) technologies and processes necessary 
for abundant commercial production of biobased 
fuels at prices competitive with fossil fuels; 
‘‘(B) high-value biobased products— 
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‘‘(i) to enhance the economic viability 
of biobased fuels and power; 
‘‘(ii) as substitutes for petroleum- 
based feedstocks and products; and 
‘‘(iii) to enhance the value of coprod-
ucts arise from such technologies and proc-
esses; and 
‘‘(C) a diversity of sustainable domestic 
sources of biomass for conversion to biobased 
fuels and biobased products. 
‘‘(3) PURPOSES.—The purposes of the Initiative 
are— 
‘‘(A) to increase the energy security of the 
United States; 
‘‘(B) to create jobs and enhance the eco-
nomic development of the rural economy; 
‘‘(C) to enhance the environment and pub-
lic health; and 
‘‘(D) to diversify markets for raw agricul-
tural and forestry products. 
‘‘(4) TECHNICAL AREAS.—To advance the ob-
jectives and purposes of the Initiative, the Secretary 
of Agriculture and the Secretary of Energy, in con-
sultation with the Administrator of the Environ-
mental Protection Agency and heads of other appro-
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priate departments and agencies (referred to in this 
subsection as the ‘Secretaries’), shall direct research, 
development, and commercial applications toward— 
‘‘(A) feedstocks and feedstock systems rel-
evant to production of raw materials for conver-
sion to biobased fuels and biobased products, 
including— 
‘‘(i) development of advanced and 
dedicated crops and other biomass sources 
with desired features, including enhanced 
productivity, broader site range, low re-
quirements for chemical inputs, and en-
hanced processing; 
‘‘(ii) advanced crop production meth-
ods to achieve the features described in 
clause (i); 
‘‘(iii) feedstock harvest, handling, 
transport, and storage; 
‘‘(iv) strategies for integrating feed-
stock production into existing managed 
land; and 
‘‘(v) improving the value and quality 
of coproducts, including materials used for 
animal feeding; 
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‘‘(B) overcoming recalcitrance of cellulosic 
biomass through developing technologies for 
converting cellulosic biomass into intermediates 
that can subsequently be converted into 
biobased fuels and biobased products, includ-
ing— 
‘‘(i) pretreatment in combination with 
enzymatic or microbial hydrolysis; 
‘‘(ii) thermochemical approaches, in-
cluding gasification and pyrolysis; and 
‘‘(iii) self-processing crops that ex-
press enzymes capable of degrading cel-
lulosic biomass; 
‘‘(C) product diversification through tech-
nologies relevant to production of a range of 
biobased products (including chemicals, animal 
feeds, and cogenerated power) that eventually 
can increase the feasibility of fuel production in 
a biorefinery, including— 
‘‘(i) catalytic processing, including 
thermochemical fuel production; 
‘‘(ii) metabolic engineering, enzyme 
engineering, and fermentation systems for 
biological production of desired products, 
coproducts, or cogeneration of power; 
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‘‘(iii) product recovery; 
‘‘(iv) power production technologies; 
‘‘(v) integration into existing biomass 
processing facilities, including starch eth-
anol plants, sugar processing or refining 
plants, paper mills, and power plants; and 
‘‘(vi) enhancement of products and co-
products, including dried distillers grains 
(including substantially elevated starch 
content, increased oil content, improved 
fatty acid profiles, and improved resistance 
to mold and mycotoxins; 
‘‘(D) analysis that provides strategic guid-
ance for the application of biomass technologies 
in accordance with realization of improved sus-
tainability and environmental quality, cost ef-
fectiveness, security, and rural economic devel-
opment, usually featuring system-wide ap-
proaches; 
‘‘(E) the improvement and development of 
analytical tools to facilitate the analysis of life- 
cycle energy and greenhouse gas emissions, in-
cluding emissions related to direct and indirect 
land use changes, attributable to all potential 
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biofuel feedstocks and production processes; 
and 
‘‘(F) the systematic evaluation of the im-
pact of expanded biofuel production on the envi-
ronment, including forest lands, and on the 
food supply for humans and animals. 
‘‘(5) ADDITIONAL
CONSIDERATIONS.—Within 
the technical areas described in paragraph (4), and 
in addition to advancing the purposes described in 
paragraph (3) and the objectives described in para-
graph (2), the Secretaries shall support research and 
development— 
‘‘(A) to create continuously expanding op-
portunities for participants in existing biofuels 
production by seeking synergies and continuity 
with current technologies and practices, such as 
improvements in dried distillers grains as a 
bridge feedstock; 
‘‘(B) to maximize the environmental, eco-
nomic, and social benefits of production of 
biobased fuels and biobased products on a large 
scale through life-cycle economic and environ-
mental analysis and other means; 
‘‘(C) to assess the potential of Federal 
land and land management programs as feed-
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stock resources for biobased fuels and biobased 
products, consistent with the integrity of soil 
and water resources and with other environ-
mental considerations; and 
‘‘(D) to facilitate small-scale production, 
local, and on-farm use of biofuels, including the 
development of small-scale gasification tech-
nologies for production of biofuel from cellulosic 
feedstocks. 
‘‘(6) ELIGIBLE ENTITIES.—To be eligible for a 
grant, contract, or assistance under this subsection, 
an applicant shall be— 
‘‘(A) an institution of higher education; 
‘‘(B) a National Laboratory; 
‘‘(C) a Federal research agency; 
‘‘(D) a State research agency; 
‘‘(E) a private sector entity; 
‘‘(F) a nonprofit organization; or 
‘‘(G) a consortium of two or more entities 
described in subparagraphs (A) through (F). 
‘‘(7) ADMINISTRATION.— 
‘‘(A) IN
GENERAL.—After consultation 
with the Board, the points of contact shall— 
‘‘(i) publish annually one or more 
joint requests for proposals for grants, 
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132 
contracts, and assistance under this sub-
section; 
‘‘(ii) require that grants, contracts, 
and assistance under this section be 
awarded competitively, on the basis of 
merit, after the establishment of proce-
dures that provide for scientific peer review 
by an independent panel of scientific and 
technical peers; and 
‘‘(iii) give some preference to applica-
tions that— 
‘‘(I) involve a consortia of experts 
from multiple institutions; 
‘‘(II) encourage the integration 
of disciplines and application of the 
best technical resources; and 
‘‘(III) increase the geographic di-
versity of demonstration projects. 
‘‘(B) DISTRIBUTION
OF
FUNDING
BY 
TECHNICAL AREA.—Of the funds authorized to 
be appropriated for activities described in this 
subsection, funds shall be distributed for each 
of fiscal years 2007 through 2012 so as to 
achieve an approximate distribution of— 
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‘‘(iii) 50 percent of the funds for dem-
onstration and commercial applications. 
‘‘(D) MATCHING FUNDS.— 
‘‘(i) IN
GENERAL.—A minimum 20 
percent funding match shall be required 
for demonstration projects under this sec-
tion. 
‘‘(ii) COMMERCIAL APPLICATIONS.—A 
minimum of 50 percent funding match 
shall be required for commercial applica-
tion projects under this section. 
‘‘(E) TECHNOLOGY
AND
INFORMATION 
TRANSFER TO AGRICULTURAL USERS.—The Ad-
ministrator of the Cooperative State Research, 
Education, and Extension Service and the Chief 
of the Natural Resources Conservation Service 
shall ensure that applicable research results and 
technologies from the Initiative are adapted, 
made available, and disseminated through those 
services, as appropriate. 
‘‘(h) ADMINISTRATIVE SUPPORT AND FUNDS.— 
‘‘(1) IN GENERAL.—To the extent administra-
tive support and funds are not provided by other 
agencies under paragraph (2)(b), the Secretary of 
Energy and the Secretary of Agriculture may pro-
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135 
vide such administrative support and funds of the 
Department of Energy and the Department of Agri-
culture to the Board and the Advisory Committee as 
are necessary to enable the Board and the Advisory 
Committee to carry out their duties under this sec-
tion. 
‘‘(2) OTHER
AGENCIES.—The heads of the 
agencies referred to in subsection (e)(2)(C), and the 
other 
members 
appointed 
under 
subsection 
(e)(2)(D), may, and are encouraged to, provide ad-
ministrative support and funds of their respective 
agencies to the Board and the Advisory Committee. 
‘‘(3) LIMITATION.—Not more than 4 percent of 
the amount appropriated for each fiscal year under 
subsection (g)(6) may be used to pay the adminis-
trative costs of carrying out this section. 
‘‘(i) REPORTS.— 
‘‘(1) ANNUAL REPORTS.—For each fiscal year 
for which funds are made available to carry out this 
section, the Secretary of Energy and the Secretary 
of Agriculture shall jointly submit to Congress a de-
tailed report on— 
‘‘(A) the status and progress of the Initia-
tive, including a report from the Advisory Com-
mittee on whether funds appropriated for the 
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Initiative have been distributed and used in a 
manner that— 
‘‘(i) is consistent with the objectives, 
purposes, and additional considerations de-
scribed in paragraphs (2) through (5) of 
subsection (g); 
‘‘(ii) uses the set of criteria estab-
lished in the initial report submitted under 
title III of the Agricultural Risk Protection 
Act of 2000; 
‘‘(iii) achieves the distribution of 
funds described in subparagraphs (B) and 
(C) of subsection (g)(7); and 
‘‘(iv) takes into account any rec-
ommendations that have been made by the 
Advisory Committee; 
‘‘(B) the general status of cooperation and 
research and development efforts carried out at 
each agency with respect to biobased fuels and 
biobased products, including a report from the 
Advisory Committee on whether the points of 
contact are funding proposals that are selected 
under subsection (g)(3)(B)(iii); and 
‘‘(C) the plans of the Secretary of Energy 
and the Secretary of Agriculture for addressing 
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137 
concerns raised in the report, including con-
cerns raised by the Advisory Committee. 
‘‘(2) UPDATES.—The Secretary and the Sec-
retary of Energy shall update the Vision and Road-
map documents prepared for Federal biomass re-
search and development activities. 
‘‘(3) MANAGEMENT PLAN.—The Secretary shall 
every five years, in consultation with the Secretary 
of Energy, submit to Congress a detailed manage-
ment plan for the implementation of this section. 
The management plan shall include— 
‘‘(A) consideration of the contribution of 
the section towards achieving the objectives re-
ferred to in paragraphs (2) and (3) of sub-
section (g) and in achieving the goals of the 
biomass program of the Department of Energy; 
‘‘(B) consideration of input solicited from 
the Advisory Committee, State, and private 
sources; and 
‘‘(C) specific and quantifiable near and 
long-term goals. 
‘‘(j) FUNDING.— 
‘‘(1) IN GENERAL.—Of the funds of the Com-
modity Credit Corporation, the Secretary of Agri-
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138 
culture shall make available to carry out this sec-
tion— 
‘‘(A) $35,000,000 for fiscal year 2008; 
‘‘(B) $60,000,000 for fiscal year 2009; 
‘‘(C) $75,000,000 for fiscal year 2010; 
‘‘(D) $100,000,000 for fiscal year 2011; 
and 
‘‘(E) $150,000,000 for fiscal year 2012. 
‘‘(2) ADDITIONAL
FUNDING.—In addition to 
amounts transferred under paragraph (1), there are 
authorized to be appropriated to carry out this sec-
tion $200,000,000 for each of fiscal years 2006 
through 2015.’’. 
(b) REPEAL.—Title III of the Agricultural Risk Pro-
tection Act of 2000 (Public Law 106–224; 7 U.S.C. 8601 
et seq.) is hereby repealed. 
(c) MANAGEMENT PLAN SUBMISSION DATE.—The 
first management plan required to be submitted under sec-
tion 9008(i)(3) of the Biomass Research and Development 
Act of 2000, as added by subsection (a), shall be sub-
mitted not later than 180 days after the date of the enact-
ment of this Act. 
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SEC. 504. FOREST BIOENERGY RESEARCH PROGRAM. 
Title IX of the Farm Security and Rural Investment 
Act of 2002 (7 U.S.C. 8101 et seq.) is further amended 
by adding at the end the following new section: 
‘‘SEC. 9013. FOREST BIOENERGY RESEARCH PROGRAM. 
‘‘(a) IN GENERAL.—The Secretary of Agriculture, 
working through the Forest Service, in cooperation with 
other Federal agencies, land grant colleges and univer-
sities, and private entities, shall conduct a competitive re-
search and development program to encourage new forest- 
to-energy technologies. The Secretary may use grants, co-
operative agreements, and other methods to partner with 
cooperating entities on projects that the Secretary deter-
mines shall best promote new forest-to-energy tech-
nologies. 
‘‘(b) PRIORITY FOR PROJECT SELECTION.—The Sec-
retary shall give priority to projects that— 
‘‘(1) develop technology and techniques to use 
low value forest materials, such as byproducts of for-
est health treatments and hazardous fuel reduction, 
for the production of energy; 
‘‘(2) develop processes for the conversion of cel-
lulosic forest materials that integrate production of 
energy into existing manufacturing steams or in in-
tegrated forest biorefineries; 
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‘‘(3) develop new transportation fuels that use 
forest materials as a feedstock for the production of 
such fuels; or 
‘‘(4) improve the of growth and yield of trees 
for the purpose of renewable energy and other forest 
product use. 
‘‘(c) FUNDING.—Of the funds of the Commodity 
Credit Corporation, the Secretary of Agriculture shall 
make available to carry out this section— 
‘‘(1) $4,000,000 for fiscal year 2008; 
‘‘(2) $6,000,000 for fiscal year 2009; 
‘‘(3) $7,000,000 for fiscal year 2010; 
‘‘(4) $9,000,000 for fiscal year 2011; and 
‘‘(5) $10,000,000 for fiscal year 2012.’’. 
SEC. 505. EARLY ACTION RENEWABLE FUEL MARKETING. 
(a) ADMINISTRATION.—Section 211(o)(5) of the 
Clean Air Act (as amended by by Public Law 110–140) 
is amended by adding the following new subparagraph at 
the end thereof: 
‘‘(E) USE
OF
EARLY
RENEWABLE
FUEL 
CREDITS FOR ADVANCED BIOFUEL.—Any per-
son who generates credits for renewable fuel 
that exceed it annual obligation for renewable 
fuel and its obligation for renewable fuel during 
the 12 month period specified in subparagraph 
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(C) may retain such credits and use the credits 
(on a volume equivalent basis) for the purpose 
of complying with such person’s obligation 
under paragraph (2) with respect to advanced 
biofuel in any future year (notwithstanding the 
12-month limitation referred to in subpara-
graph (C)).’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall take effect on January 1, 2009. 
TITLE VI—ALTERNATIVE 
VEHICLE FUELS 
SEC. 601. CREDIT FOR PLUG-IN HYBRID VEHICLES. 
(a) IN GENERAL.—Subpart B of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to other credits), as amended by this Act, 
is amended by adding at the end the following new section: 
‘‘SEC. 30E. PLUG-IN HYBRID VEHICLES. 
‘‘(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 cost of any 
qualified plug-in hybrid vehicle placed in service by the 
taxpayer during the taxable year. 
‘‘(b) LIMITATIONS.— 
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‘‘(1) LIMITATION PER VEHICLE.—The amount 
of the credit allowed under subsection (a) for any ve-
hicle shall not exceed the sum of— 
‘‘(A) $4,000 in the case of a plug-in elec-
tric drive vehicle with 4kWh traction battery, 
and 
‘‘(B) $250 for each additional kWh of 
traction battery capacity of such vehicle as ex-
ceeds 4 kWh but does not exceed 50 kWh. 
‘‘(2) APPLICATION WITH OTHER CREDITS.— 
‘‘(A) BUSINESS CREDIT TREATED AS PART 
OF GENERAL BUSINESS CREDIT.—So much of 
the credit which would be allowed under sub-
section (a) for any taxable year (determined 
without regard to this paragraph) that is attrib-
utable to property of a character subject to an 
allowance for depreciation shall be treated as a 
credit listed in section 38(b) for such taxable 
year (and not allowed under subsection (a)). 
‘‘(B) PERSONAL CREDITS.—The credit al-
lowed by subsection (a) for any taxable year 
shall not exceed the excess (if any) of— 
‘‘(i) the sum of the regular tax liabil-
ity (as defined in section 26(b)) plus the 
tax imposed by section 55, over 
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‘‘(ii) the sum of the credits allowable 
under subpart A and subpart B (other 
than this section). 
‘‘(c) QUALIFIED PLUG-IN HYBRID VEHICLE.—For 
purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘qualified plug-in 
hybrid vehicle’ means a motor vehicle (as defined in 
section 30(c)(2))— 
‘‘(A) the original use of which commences 
with the taxpayer, 
‘‘(B) which is acquired for use or lease by 
the taxpayer and not for resale, 
‘‘(C) which is made by a manufacturer, 
‘‘(D) which has received a certificate of 
conformity under the Clean Air Act, and 
‘‘(E) which has not less than 2 onboard 
sources of stored energy, different in character 
from each other, from which to draw propulsion 
energy, where— 
‘‘(i) at least 1 of such sources is ener-
gized by plugging into an external source 
of electric power, and 
‘‘(ii) at least 1 of such sources is ener-
gized from an internal combustion engine, 
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144 
fuel cell, or other means, and such 
source— 
‘‘(I) is utilized to provide me-
chanical propulsion to the vehicle, or 
‘‘(II) is used to recharge the bat-
tery as an on-board recharging system 
that is used to maintain charge to the 
battery. 
‘‘(2) EXCEPTION.—The term ‘qualified plug-in 
hybrid vehicle’ shall not include any vehicle which is 
not a passenger automobile or light truck if such ve-
hicle has a gross vehicle weight rating of less than 
8,500 pounds. 
‘‘(3) OTHER TERMS.—The terms ‘‘automobile’’, 
‘‘passenger automobile’’, ‘‘light truck’’, and ‘‘manu-
facturer’’ have the meanings given such terms in 
regulations prescribed by the Administrator of the 
Environmental Protection Agency for purposes of 
the administration of title II of the Clean Air Act 
(42 U.S.C. 7521 et seq.). 
‘‘(4) Kwh TRACTION BATTERY CAPACITY.—The 
term ‘kWh traction battery capacity’ means the size 
of an electro chemical storage device, expressed in 
kWh, as measured from a 100 percent state of 
charge to 0 percent state of charge. 
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‘‘(d) SPECIAL RULES.— 
‘‘(1) BASIS
REDUCTION.—The basis of any 
property for which a credit is allowable under sub-
section (a) shall be reduced by the amount of such 
credit (determined without regard to subsection 
(b)(2)). 
‘‘(2) RECAPTURE.—The Secretary shall, by reg-
ulations, provide for recapturing the benefit of any 
credit allowable under subsection (a) with respect to 
any property which ceases to be property eligible for 
such credit. 
‘‘(3) 
PROPERTY
USED
OUTSIDE
UNITED 
STATES, ETC., NOT QUALIFIED.—No credit shall be 
allowed under subsection (a) with respect to any 
property referred to in section 50(b) or with respect 
to the portion of the cost of any property taken into 
account under section 179. 
‘‘(4) DENIAL OF DOUBLE BENEFIT.—No credit 
shall be allowed under this section with respect to a 
vehicle if a credit or deduction is allowed with re-
spect to such vehicle under any other provision of 
this title. 
‘‘(5) ELECTION
NOT
TO
TAKE
CREDIT.—No 
credit shall be allowed under subsection (a) for any 
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146 
vehicle if the taxpayer elects to not have this section 
apply to such vehicle. 
‘‘(6) PROPERTY USED BY TAX-EXEMPT ENTITY; 
INTERACTION WITH AIR QUALITY AND MOTOR VEHI-
CLE SAFETY STANDARDS.—Rules similar to the rules 
of paragraphs (6) and (10) of section 30B(h) shall 
apply for purposes of this section. 
‘‘(e) TERMINATION.—This section shall not apply to 
any property placed in service after December 31, 2014.’’. 
(b) PLUG-IN HYBRID VEHICLES NOT COUNTED TO-
WARD LIMITATION ON NUMBER OF NEW QUALIFIED HY-
BRID VEHICLES ELIGIBLE FOR 30B CREDIT.—Section 
30B(f)(5) of such Code (defining qualified vehicle) is 
amended by adding at the end the following new sentence: 
‘‘Such term shall not include a qualified plug-in hybrid 
vehicle (as defined in section 30E(c)).’’. 
(c) CREDIT MADE PART OF GENERAL BUSINESS 
CREDIT.—Section 38(b) of such Code, as amended by this 
Act, is amended by striking ‘‘and’’ at the end of paragraph 
(31), by striking the period at the end of paragraph (32) 
and inserting ‘‘, plus’’, and by adding at the end the fol-
lowing new paragraph: 
‘‘(33) the portion of the plug-in hybrid vehicle 
credit to which section 30E(b)(2)(A) applies.’’. 
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147 
(d) CONFORMING AMENDMENT.—Section 6501(m) of 
such Code is amended by inserting ‘‘30E(d)(5),’’ after 
‘‘30D(e)(5),’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2007. 
SEC. 602. USE OF CREDITS. 
Section 312(b) of the Energy Policy Act of 1992 (42 
U.S.C. 13220(b)) is amended— 
(1) by striking ‘‘(b) USE OF CREDITS.—’’ and 
all that follows through ‘‘At the request’’ and insert-
ing ‘‘(b) USE OF CREDITS.—At the request’’; and 
(2) by striking paragraph (2). 
TITLE VII—OFFSHORE OIL AND 
GAS LEASING 
SEC. 701. TERMINATION OF PROHIBITIONS ON EXPENDI-
TURES FOR, AND WITHDRAWALS FROM, OFF-
SHORE LEASING. 
(a) PROHIBITIONS ON EXPENDITURES.—All provi-
sions of Federal law that prohibit the expenditure of ap-
propriated funds to conduct oil or natural gas leasing and 
preleasing activities for any area of the Outer Continental 
Shelf shall have no force or effect with respect to such 
activities. 
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148 
(b) REVOCATION WITHDRAWALS.—All withdrawals 
of Federal submerged lands of the Outer Continental Shelf 
from leasing, including withdrawals by the President 
under the authority of section 12(a) of the Outer Conti-
nental Shelf Lands Act (43 U.S.C. 1341(a)), are hereby 
revoked and are no longer in effect with respect to the 
leasing of areas for exploration for, and development and 
production of, oil and natural gas. 
SEC. 702. OUTER CONTINENTAL SHELF LEASING PROGRAM. 
The Outer Continental Shelf Lands Act (43 U.S.C. 
1331 et seq.) is amended by inserting after section 9 the 
following: 
‘‘SEC. 10. MORATORIA AREA AND STATE APPROVAL RE-
QUIREMENT WITH RESPECT TO OIL AND NAT-
URAL GAS LEASING. 
‘‘(a) BUFFER ZONE.—The Secretary may not grant 
any oil or natural gas lease for any area of the outer Con-
tinental Shelf that is located within 25 miles of the coast-
line of a State. 
‘‘(b) STATE APPROVAL REQUIREMENT.— 
‘‘(1) IN
GENERAL.—The Secretary may not 
issue any lease authorizing exploration for, or devel-
opment of, natural gas in any area of the outer Con-
tinental Shelf that is located within 50 miles of the 
coastline of a State unless the State has enacted a 
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149 
law approving of the issuance of such leases by the 
Secretary. 
‘‘(2) STATE APPROVAL PERMANENT.—Repeal of 
such a law by a State shall have no effect for pur-
poses of paragraph (1). 
‘‘(c) STATE DISAPPROVAL AUTHORITY.— 
‘‘(1) IN
GENERAL.—The Secretary may not 
issue any lease authorizing exploration for, or devel-
opment of, oil or natural gas in any area of the 
outer Continental Shelf that is located more than 50 
miles and less than 100 miles from the coastline of 
a State if the State has enacted a law disapproving 
of the issuance of such leases by the Secretary. 
‘‘(2) REQUIREMENTS FOR STATE LAW.—A law 
enacted by a State for purposes of paragraph (1)— 
‘‘(A) shall have no force or effect for pur-
poses of paragraph (1) unless first enacted by 
the State within the one-year period beginning 
on the date of the enactment of the National 
Environment and Energy Development Act; and 
‘‘(B) shall have no force or effect for pur-
poses of paragraph (1) after the end of the 2- 
year period beginning on the date it first takes 
effect, unless the State, in the 2-year period 
preceding the application of the law for pur-
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150 
poses of paragraph (1), enacted legislation ex-
tending the effectiveness of the law.’’. 
SEC. 703. SHARING OF REVENUES. 
(a) IN GENERAL.—Section 8(g) of the Outer Conti-
nental Shelf Lands Act (43 U.S.C. 1337(g)) is amended— 
(1) in paragraph (2) by striking ‘‘Notwith-
standing’’ and inserting ‘‘Except as provided in 
paragraph (6), and notwithstanding’’; 
(2) by redesignating paragraphs (6) and (7) as 
paragraphs (8) and (9); and 
(3) by inserting after paragraph (5) the fol-
lowing: 
‘‘(6) BONUS
BIDS
AND
ROYALTIES
UNDER 
QUALIFIED OIL AND GAS LEASES.— 
‘‘(A) NEW
OIL
AND
GAS
LEASES.—Of 
amounts received by the United States as bonus 
bids and royalties under any qualified oil or gas 
lease on submerged lands that are located with-
in the seaward boundaries of a State estab-
lished under section 4(a)(2)(A)— 
‘‘(i) 37.5 percent shall be paid to the 
States that are producing States with re-
spect to those submerged lands; and 
‘‘(ii) the remainder shall be trans-
ferred to the American-Made Energy Trust 
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151 
Fund established by section 9511 of the 
Internal Revenue Code of 1986. 
‘‘(B) LEASED
TRACT
THAT
LIES
PAR-
TIALLY WITHIN THE SEAWARD BOUNDARIES OF 
A STATE.—In the case of a leased tract that lies 
partially within the seaward boundaries of a 
State, the amounts of bonus bids and royalties 
from such tract that are subject to subpara-
graph (A) with respect to such State shall be a 
percentage of the total amounts of bonus bids 
and royalties from such tract that is equivalent 
to the total percentage of surface acreage of the 
tract that lies within such seaward boundaries. 
‘‘(C) USE
OF
PAYMENTS
TO
STATES.— 
Amounts paid to a State under subparagraph 
(A)(ii) shall be used by the State for one or 
more of the following: 
‘‘(i) Education. 
‘‘(ii) Transportation. 
‘‘(iii) Reducing taxes. 
‘‘(iv) Coastal and environmental res-
toration. 
‘‘(v) 
Energy 
infrastructure 
and 
projects. 
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‘‘(vi) State seismic monitoring pro-
grams. 
‘‘(vii) Alternative energy development. 
‘‘(viii) Energy efficiency and conserva-
tion. 
‘‘(ix) Hurricane and natural disaster 
insurance programs. 
‘‘(x) Any other purpose determined by 
State law. 
‘‘(D) DEFINITIONS.—In this paragraph: 
‘‘(i) ADJACENT
STATE.—The term 
‘adjacent State’ means, with respect to any 
program, plan, lease sale, leased tract or 
other activity, proposed, conducted, or ap-
proved pursuant to the provisions of this 
Act, any State the laws of which are de-
clared, pursuant to section 4(a)(2), to be 
the law of the United States for the por-
tion of the outer Continental Shelf on 
which such program, plan, lease sale, 
leased tract, or activity appertains or is, or 
is proposed to be, conducted. 
‘‘(ii) ADJACENT
ZONE.—The term 
‘adjacent zone’ means, with respect to any 
program, plan, lease sale, leased tract, or 
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other activity, proposed, conducted, or ap-
proved pursuant to the provisions of this 
Act, the portion of the outer Continental 
Shelf for which the laws of a particular ad-
jacent State are declared, pursuant to sec-
tion 4(a)(2), to be the law of the United 
States. 
‘‘(iii) PRODUCING STATE.—The term 
‘producing State’ means an Adjacent State 
having an adjacent zone containing leased 
tracts from which are derived bonus bids 
and royalties under a lease under this Act. 
‘‘(iv) STATE.—The term ‘State’ in-
cludes Puerto Rico and the other Terri-
tories of the United States. 
‘‘(v) QUALIFIED
GAS
LEASE.—The 
term ‘qualified oil or gas lease’ means a 
lease under this Act granted after the date 
of the enactment of the National Environ-
ment and Energy Development Act that 
authorizes development and production of 
oil or natural gas and associated conden-
sate. 
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154 
‘‘(E) APPLICATION.—This paragraph shall 
apply to bonus bids and royalties received by 
the United States after September 30, 2007. 
‘‘(7) MAINTENANCE OF EFFORT BY STATES.— 
The Secretary of the Interior shall ensure that fi-
nancial assistance provided to a State for any pur-
pose with amounts made available under this sub-
section supplement, and do not replace, the amounts 
expended by the State for that purpose before the 
date of the enactment of this paragraph.’’. 
(b) ESTABLISHMENT OF STATE SEAWARD BOUND-
ARIES.—Section 4(a)(2)(A) of the Outer Continental Shelf 
Lands Act (43 U.S.C. 1333(a)(2)(A)) is amended in the 
first sentence by striking ‘‘, and the President’’ and all 
that follows through the end of the sentence and inserting 
the following: ‘‘. Such extended lines are deemed to be as 
indicated on the maps for each Outer Continental Shelf 
region entitled ‘Alaska OCS Region State Adjacent Zone 
and OCS Planning Areas’, ‘Pacific OCS Region State Ad-
jacent Zones and OCS Planning Areas’, ‘Gulf of Mexico 
OCS Region State Adjacent Zones and OCS Planning 
Areas’, and ‘Atlantic OCS Region State Adjacent Zones 
and OCS Planning Areas’, all of which are dated Sep-
tember 2005 and on file in the Office of the Director, Min-
erals Management Service. The preceding sentence shall 
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not apply with respect to the treatment under section 105 
of the Gulf of Mexico Energy Security Act of 2006 (title 
I of division C of Public Law 109–432) of qualified outer 
Continental Shelf revenues deposited and disbursed under 
subsection (a)(2) of that section.’’. 
TITLE 
VIII—INCREASING 
NU-
CLEAR 
GENERATED 
ELEC-
TRIC ENERGY 
SEC. 801. INCREASING NUCLEAR GENERATED ELECTRIC 
ENERGY. 
Notwithstanding any other provision of law, the 
President is authorized to take such steps as are necessary 
to increase the share of electricity generated from nuclear 
power to 40 percent of the total domestic generation by 
the year 2050. 
Æ 
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