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scribed in section 1381(a) which is owned more
than 50 percent by agricultural producers or by
entities owned by agricultural producers. For
this purpose an entity owned by an agricultural
producer is one that is more than 50 percent
owned by agricultural producers.
‘‘(E) WRITTEN
NOTICE
TO
PATRONS.—If
any portion of the credit available under sub-
section (a) is allocated to patrons under sub-
paragraph (A), the eligible cooperative shall pro-
vide any patron receiving an allocation written
notice of the amount of the allocation. Such no-
tice shall be provided before the date on which
the return described in subparagraph (B)(ii) is
due.’’.
SEC. 1503. EXPANSION OF RESOURCES TO WAVE, CURRENT,
TIDAL, AND OCEAN THERMAL ENERGY.
(a) IN GENERAL.—Section 45(c)(1) (defining qualified
energy resources), as amended by this Act, is amended by
striking ‘‘and’’ at the end of subparagraph (H), by striking
the period at the end of subparagraph (I) and inserting ‘‘,
and’’, and by adding at the end the following new subpara-
graph:
‘‘(J) wave, current, tidal, and ocean ther-
mal energy.’’
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(b) DEFINITION OF RESOURCES.—Section 45(c), as
amended by this Act, is amended by adding at the end the
following new paragraph:
‘‘(9) WAVE, CURRENT, TIDAL, AND OCEAN THER-
MAL ENERGY.—The term ‘wave, current, tidal, and
ocean thermal energy’ means electricity produced
from any of the following:
‘‘(A) Free flowing ocean water derived from
tidal currents, ocean currents, waves, or estuary
currents.
‘‘(B) Ocean thermal energy.
‘‘(C) Free flowing water in rivers, lakes,
man made channels, or streams.’’
(c) FACILITIES.—Section 45(d), as amended by this
Act, is amended by adding at the end the following new
paragraph:
‘‘(11) WAVE, 
CURRENT, 
TIDAL, 
AND
OCEAN
THERMAL FACILITY.—In the case of a facility using
resources described in subparagraph (A), (B), or (C)
of subsection (c)(9) to produce electricity, the term
‘qualified facility’ means any facility owned by the
taxpayer which is originally placed in service after
the date of the enactment of this paragraph and before
January 1, 2009, but such term shall not include a
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facility which includes impoundment structures or a
small irrigation power facility.’’
(b) EFFECTIVE DATE.—The amendments made by this
section shall apply to taxable years ending after the date
of the enactment of this Act.
SEC. 1504. CLEAN RENEWABLE ENERGY BONDS.
(a) IN GENERAL.—Part IV of subchapter A of chapter
1 (relating to credits against tax) is amended by adding
at the end the following new subpart:
‘‘Subpart H—Nonrefundable Credit to Holders of
Certain Bonds
‘‘Sec. 54. Credit to holders of clean renewable energy bonds.
‘‘SEC. 54. CREDIT TO HOLDERS OF CLEAN RENEWABLE EN-
ERGY BONDS.
‘‘(a) ALLOWANCE OF CREDIT.—If a taxpayer holds a
clean renewable energy bond on 1 or more credit allowance
dates of the bond occurring during any taxable year, 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 the credits determined under subsection (b) with respect
to such dates.
‘‘(b) AMOUNT OF CREDIT.—
‘‘(1) IN GENERAL.—The amount of the credit de-
termined under this subsection with respect to any
credit allowance date for a clean renewable energy
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bond is 25 percent of the annual credit determined
with respect to such bond.
‘‘(2) ANNUAL CREDIT.—The annual credit deter-
mined with respect to any clean renewable energy
bond is the product of—
‘‘(A) the credit rate determined by the Sec-
retary under paragraph (3) for the day on which
such bond was sold, multiplied by
‘‘(B) the outstanding face amount of the
bond.
‘‘(3) DETERMINATION.—For purposes of para-
graph (2), with respect to any clean renewable energy
bond, the Secretary shall determine daily or cause to
be determined daily a credit rate which shall apply
to the first day on which there is a binding, written
contract for the sale or exchange of the bond. The
credit rate for any day is the credit rate which the
Secretary or the Secretary’s designee estimates will
permit the issuance of clean renewable energy bonds
with a specified maturity or redemption date without
discount and without interest cost to the qualified
issuer.
‘‘(4) CREDIT ALLOWANCE DATE.—For purposes
of this section, the term ‘credit allowance date’
means—
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‘‘(A) March 15,
‘‘(B) June 15,
‘‘(C) September 15, and
‘‘(D) December 15.
Such term also includes the last day on which the
bond is outstanding.
‘‘(5) SPECIAL RULE FOR ISSUANCE AND REDEMP-
TION.—In the case of a bond which is issued during
the 3-month period ending on a credit allowance date,
the amount of the credit determined under this sub-
section with respect to such credit allowance date
shall be a ratable portion of the credit otherwise deter-
mined based on the portion of the 3-month period
during which the bond is outstanding. A similar rule
shall apply when the bond is redeemed or matures.
‘‘(c) LIMITATION BASED ON AMOUNT OF TAX.—The
credit allowed under subsection (a) for any taxable year
shall not exceed the excess of—
‘‘(1) the sum of the regular tax liability (as de-
fined in section 26(b)) plus the tax imposed by section
55, over
‘‘(2) the sum of the credits allowable under this
part (other than subpart C thereof (relating to refund-
able credits) and this subpart) and section 1397E.
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‘‘(d) CLEAN RENEWABLE ENERGY BOND.—For pur-
poses of this section—
‘‘(1) IN GENERAL.—The term ‘clean renewable
energy bond’ means any bond issued as part of an
issue if—
‘‘(A) the bond is issued by a qualified issuer
pursuant to an allocation by the Secretary to
such issuer of a portion of the national clean re-
newable energy bond limitation under subsection
(f)(2),
‘‘(B) 95 percent or more of the proceeds
from the sale of such issue are to be used for cap-
ital expenditures incurred by qualified borrowers
for 1 or more qualified projects,
‘‘(C) the qualified issuer designates such
bond for purposes of this section and the bond is
in registered form, and
‘‘(D) the issue meets the requirements of
subsection (h).
‘‘(2) 
QUALIFIED
PROJECT; 
SPECIAL
USE
RULES.—
‘‘(A) IN
GENERAL.—The term ‘qualified
project’ means any qualified facility (as deter-
mined under section 45(d) without regard to any