SEC. 2. FINDINGS. 
Congress makes the following findings: 
(1) Congress enacted legislation to dramatically 
increase Corporate Average Fuel Economy standards 
(hereafter in this section referred to as ‘‘CAFE 
standards’’), mandating a fleet-wide fuel economy of 
35 miles per gallon by 2020. 
(2) The new CAFE standards represent a 27 
percent increase over current CAFE standards. 
(3) The new CAFE standards require Chrysler, 
Ford, and General Motors to increase their research 
and development investments at an estimated cost of 
$85,000,000,000. 
(4) Chrysler, Ford, and General Motors cur-
rently 
invest 
a 
total 
of 
approximately 
$16,000,000,000 each year to research and develop 
safer, more efficient, and alternatively fueled auto-
mobiles. 
(5) Chrysler, Ford, and General Motors employ 
more than 65,000 Americans to research and de-
velop new technologies. 
(6) These required investments will place a 
large cost burden on an already struggling industry, 
representing an estimated additional $7,000,000,000 
per year above current research and development in-
vestments. 
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(7) Investments of finite funds in new energy 
efficiency initiatives should not detract from current 
investments in improved vehicle safety technology. 
(8) Energy availability is a national security 
issue of the utmost importance. 
(9) A significant portion of United States en-
ergy use comes from imported petroleum products 
from unstable regions. 
(10) Clean diesel technology is a more efficient 
way to utilize petroleum products to reduce emis-
sions in the short-term while alternative energy 
sources are developed. 
(11) Harmonization of biodiesel composition 
standards will enable more widespread use of clean 
diesel technology throughout the country. 
(12) Electric vehicle propulsion can help reduce 
dependence on petroleum-based energy. 
(13) Energy storage is critical in making elec-
tric vehicles commercially viable. 
(14) Technical challenges remain before ade-
quate energy storage for electric vehicles becomes a 
reality. 
(15) There is no current domestic production of 
advanced battery technology applicable to hybrid or 
electric vehicles. 
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(16) Domestic research, development, dem-
onstration, and production of advanced battery and 
electric vehicle technology will create many high-pay-
ing jobs. 
(17) Hydrogen fuel cell vehicles represent the 
long-term goal of nearly emission-free transpor-
tation. 
(18) Increased availability of hydrogen fuel is 
crucial to increase the viability of leap-ahead hydro-
gen vehicle technology. 
(19) The United States Government currently 
invests Federal funds across numerous agencies into 
research and development of advanced fuel and effi-
ciency enhancing technology, spending approximately 
$400,000,000 in fiscal year 2007 and approximately 
$1,100,000,000 in fiscal year 2008. 
(20) Expanding and coordinating these cur-
rently disparate efforts would yield greater gains in 
the development of viable efficient alternative fuel 
technologies. 
(21) The Federal Government can and should 
concert its efforts in order to adequately provide re-
lief from the large cost burden placed on the auto 
industry by requiring extensive research and devel-
opment of advanced technology. 
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SEC. 3. ADVANCED BATTERY RESEARCH AND DEVELOP-
MENT. 
(a) DEFINITION.—For purposes of this section, the 
term ‘‘battery’’ means an electrochemical energy storage 
system powered directly by electrical current. 
(b) RESEARCH
AND DEVELOPMENT GRANT PRO-
GRAM.— 
(1) IN
GENERAL.—The Secretary of Energy 
shall establish a program for making grants to Na-
tional Laboratories and institutions of higher edu-
cation for research, development, and demonstration 
of high-efficiency advanced battery technologies. 
Such grants may be used for— 
(A) exploratory research; 
(B) battery system devlopment; 
(C) vehicle technology demonstration and 
validation; and 
(D) United States advanced battery pro-
duction capability development. 
(2) PRIORITY
CONSIDERATION.—In awarding 
grants under this section, the Secretary of Energy 
shall give priority consideration to National Labora-
tories and institutions of higher education that part-
ner with original equipment maunfacturers of vehi-
cles that will use the high-efficiency advanced bat-
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tery technologies being researched, developed, or 
demonstrated. 
(c) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Secretary of En-
ergy for carrying out this section $150,000,000 for each 
of the fiscal years 2009 through 2013. 
SEC. 4. RESEARCH AND DEVELOPMENT TAX CREDIT. 
(a) PERMANENT EXTENSION.—Section 41 of the In-
ternal Revenue Code of 1986 (relating to credit for in-
creasing research activities) is amended by striking sub-
section (h). 
(b) REFUNDABILITY.—Section 41 of such Code, as 
amended by subsection (a), is amended by adding at the 
end the following new subsection: 
‘‘(h) PORTION OF CREDIT TREATED AS REFUND-
ABLE.— 
‘‘(1) IN GENERAL.—For purposes of this title, 
so much of the credit which would be allowed under 
this section for any taxable year (determined without 
regard to this subsection) that is attributable to ex-
penditures for technology designed to meet Cor-
porate Average Fuel Economy standards shall be 
treated as allowed under subpart C and not under 
this section. 
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