SEC. 4. STATEMENT OF POLICY. 
It is the policy of the United States that, in energy 
policy development and program implementation, the fol-
lowing factors should be considered: 
(1) Thermal energy represents a significant 
part of the energy requirements of the United 
States, providing building heating and cooling, do-
mestic hot water, and industrial process energy. 
(2) There are many opportunities for meeting 
thermal energy requirements directly through renew-
able energy sources or recycled energy (such as re-
covered waste heat), without generation of elec-
tricity. 
(3) Policies and incentives for encouraging re-
newable energy and energy efficiency should address 
thermal energy as well as electricity. 
(4) District energy systems provide an impor-
tant means of delivering sustainable thermal energy 
to consumers, and provide energy security benefits, 
by— 
(A) cutting peak power demand; 
(B) reducing power transmission and dis-
tribution system constraints; and 
(C) providing flexibility to modify fuel 
sources in response to future changes in fuel 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
availabilities and prices and development of new 
technologies. 
TITLE 
I—MODIFICATION 
OF 
CREDIT 
FOR 
ELECTRICITY 
PRODUCED 
FROM 
CERTAIN 
RENEWABLE SOURCES 
SEC. 101. EXTENSION OF RENEWABLE ELECTRICITY CRED-
IT TO THERMAL ENERGY. 
(a) CREDIT TO INCLUDE PRODUCTION OF THERMAL 
ENERGY.—Section 45 of the Internal Revenue Code of 
1986 is amended by adding at the end the following new 
subsection: 
‘‘(f) CREDIT FOR PRODUCTION OF THERMAL EN-
ERGY.— 
‘‘(1) IN GENERAL.—In the case of a taxpayer 
who— 
‘‘(A) produces thermal energy from a 
qualified energy resource described in subpara-
graph (B), (C), (D), (G), (I), or (J) of sub-
section (c)(1) at a qualified facility described in 
paragraph (2), (3), (4), (6), (7), (11), or (12) 
of subsection (d), and 
‘‘(B) makes an election under this sub-
section with respect to such facility, 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
subsection (a) shall be applied by substituting ‘each 
3,412 Btus of thermal energy (or fraction thereof)’ 
for ‘the kilowatt hours of electricity’ in paragraph 
(2) thereof. 
‘‘(2) THERMAL ENERGY.—For purposes of this 
section, the term ‘thermal energy’ means heat (in 
the form of hot water or steam) or cooling (in the 
form of chilled water or ice). 
‘‘(3) ADDITIONAL QUALIFICATIONS.— 
‘‘(A) COMBINED HEAT AND POWER FACIL-
ITY.—In the case of a facility producing both 
electricity and thermal energy, such facility 
shall not be treated as a qualified facility unless 
such facility— 
‘‘(i) meets the requirements of section 
48(c)(3)(A) (without regard to clause (iv) 
thereof); and 
‘‘(ii) was originally placed in service 
after the date of the enactment of the 
Thermal Renewable Energy and Efficiency 
Act of 2010, and before the date which is 
5 years after such date. 
‘‘(B) THERMAL FACILITY.—In the case of 
a facility producing only thermal energy, such 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
facility shall not be treated as a qualified facil-
ity unless such facility— 
‘‘(i) has an energy efficiency percent-
age 
(as 
determined 
under 
section 
48(c)(3)(C)) in excess of 60 percent; and 
‘‘(ii) was originally placed in service 
after the date of the enactment of the 
Thermal Renewable Energy and Efficiency 
Act of 2010, and before the date which is 
5 years after such date. 
‘‘(4) DENIAL OF DOUBLE BENEFIT.—If an elec-
tion under this subsection is in effect with respect 
to any facility, no credit shall be allowed under sub-
section (a) with respect to the production of elec-
tricity at such facility. 
‘‘(5) ELECTION.— 
‘‘(A) IN GENERAL.—An election under this 
subsection shall specify the facility to which the 
election applies and shall be in such manner as 
the Secretary may by regulations prescribe. 
‘‘(B) ELECTION IRREVOCABLE.—Any elec-
tion made under this subsection may not be re-
voked except with the consent of the Sec-
retary.’’. 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
(b) NATURALLY OCCURRING COLD WATER SOURCES 
TREATED
AS QUALIFIED ENERGY RESOURCE.—Para-
graph (1) of section 45(c) of the Internal Revenue Code 
of 1986 is amended— 
(1) by striking ‘‘and’’ at the end of subpara-
graph (H), 
(2) by striking the period at the end of sub-
paragraph (I) and inserting ‘‘, and’’, and 
(3) by adding at the end the following new sub-
paragraph: 
‘‘(J) naturally occurring cold water sources 
which are used to provide thermal energy for 
air conditioning.’’. 
(c) QUALIFIED FACILITIES.—Section 45(d) of the In-
ternal Revenue Code of 1986 is amended by adding at the 
end the following new paragraph: 
‘‘(12) NATURAL AIR CONDITIONING SYSTEM FA-
CILITY.—In the case of a facility providing thermal 
energy for air conditioning from naturally occurring 
cold water sources, the term ‘qualified facility’ 
means any facility owned by the taxpayer which is 
originally placed in service after the date of the en-
actment of the Thermal Renewable Energy and Effi-
ciency Act of 2010, and before the date which is 5 
years after such date.’’. 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00010
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
(d) CONFORMING AMENDMENTS.— 
(1) Section 45(b)(4)(A) of the Internal Revenue 
Code of 1986 is amended by inserting ‘‘or thermal 
energy’’ after ‘‘electricity’’. 
(2) Section 45(c)(2) of such Code is amended 
by inserting ‘‘or thermal energy’’ after ‘‘electricity’’. 
(3) Section 45(d) of such Code is amended by 
inserting ‘‘or thermal energy’’ after ‘‘electricity’’ 
each place it appears in paragraphs (2), (3), (4), 
(6), (7), and (11). 
(4) Section 45(e) of such Code is amended by 
inserting ‘‘or thermal energy’’ after ‘‘electricity’’ 
each place it appears in paragraphs (1), (4), and 
(9). 
(5) The heading of section 45 of such Code is 
amended by inserting ‘‘AND THERMAL ENERGY’’ 
after ‘‘ELECTRICITY’’. 
(6) The item relating to section 45 in the table 
of sections for subpart D of part IV of subchapter 
A of chapter 1 of such Code is amended by inserting 
‘‘and thermal energy’’ after ‘‘Electricity’’. 
(e) MODIFICATION OF DEFINITION OF OPEN-LOOP 
BIOMASS.— 
(1) IN
GENERAL.—Paragraph (3) of section 
45(c) of the Internal Revenue Code of 1986 is 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00011
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
amended by adding at the end the following new 
subparagraph: 
‘‘(C) SPECIAL RULE FOR THERMAL FACILI-
TIES.—In the case of a qualified facility which 
produces thermal energy with respect to which 
the taxpayer makes an election under sub-
section (f), the term ‘open-loop biomass’ has the 
meaning given the term in section 203(b) of the 
Energy Policy Act of 2005, as amended.’’. 
(2) CONFORMING AMENDMENT.—Subparagraph 
(A) of section 45(c)(3) of such Code is amended by 
striking ‘‘The’’ and inserting ‘‘Except as provided in 
subparagraph (C), the’’. 
(f) EFFECTIVE DATE.—The amendments made by 
this section shall apply to energy produced and sold after 
the date of the enactment of this Act. 
SEC. 102. FEDERAL PURCHASE REQUIREMENT AMEND-
MENTS. 
Section 203 of the Energy Policy Act of 2005 (42 
U.S.C. 15852) is amended by striking subsection (b) and 
inserting the following: 
‘‘(b) DEFINITIONS.—In this section: 
‘‘(1) BIOMASS.—The term ‘biomass’ means the 
following types of nonhazardous organic materials: 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00012
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
‘‘(A) Residues and byproducts from milled 
logs. 
‘‘(B) Wood, paper products that are not 
commonly recyclable, and vegetation (including 
trees and trimmings, yard waste, pallets, rail-
road ties, crates, and solid-wood manufacturing 
and construction debris), if diverted from or 
separated from other waste out of a municipal 
waste stream. 
‘‘(C) Hazard trees, trimmings, and brush 
that are necessary to remove in order to main-
tain a utility right-of-way or a public road (not 
including any unpaved road on Federal land). 
‘‘(D) Trees, trimmings, and brush har-
vested from the immediate vicinity of any build-
ing, campground, or other structure in wildfire 
prone areas to reduce the risk to the structure 
or campground or to human life from wildfires. 
‘‘(E) Invasive species (as defined in Execu-
tive Order 13112 (42 U.S.C. 4321 note; relat-
ing to invasive species)) removed to control or 
eradicate the invasive species. 
‘‘(F) Animal waste and animal byproducts 
(including biogas and any solid produced by 
micro-organisms). 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00013
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
‘‘(G) Food waste. 
‘‘(H) Algae. 
‘‘(I) Slash, brush, trees, and other vegeta-
tion that is harvested from non-Federal land or 
Indian land— 
‘‘(i) that is, at the time of harvest— 
‘‘(I) naturally regenerated forest 
land; 
‘‘(II) forest land that was planted 
for the purpose of restoring land to a 
naturally regenerated forest; or 
‘‘(III) if harvested in quantities 
and through practices that maintain 
or contribute toward the restoration 
of the species, ecological systems, and 
ecological communities for which the 
conservation forest land was identi-
fied, conservation forest land; or 
‘‘(ii) that is— 
‘‘(I) at the time of harvest, plant-
ed forest land; and 
‘‘(II) on the date of enactment of 
the Thermal Renewable Energy and 
Efficiency Act of 2010, cropland (in-
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00014
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
cluding fallow land), pastureland, or 
planted forest land. 
‘‘(J) Crops, crop byproducts, and crop resi-
dues from non-Federal land or Indian land that 
is— 
‘‘(i) at the time of harvest, not forest 
land; and 
‘‘(ii) on the date of enactment of the 
Thermal Renewable Energy and Efficiency 
Act of 2010— 
‘‘(I) cropland (including fallow 
land and not including planted forest 
land); or 
‘‘(II) pastureland. 
‘‘(K) If harvested from Federal land in ac-
cordance with applicable law and land manage-
ment plans and in quantities and through prac-
tices that maintain or contribute toward the 
restoration of ecological sustainability— 
‘‘(i) slash; and 
‘‘(ii) brush and trees that are byprod-
ucts of ecological restoration, disease or in-
sect infestation control, or hazardous fuels 
reduction treatments and— 
‘‘(I) are from stands that— 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00015
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
‘‘(aa) were killed by an in-
sect or disease epidemic or a nat-
ural disaster; and 
‘‘(bb) do not meet the utili-
zation standards for sawtimber; 
or 
‘‘(II) do not exceed the minimum 
size standards for sawtimber. 
‘‘(2) CONSERVATION FOREST LAND.— 
‘‘(A) IN GENERAL.—The term ‘conserva-
tion forest land’ means forest land that con-
tains a species, or includes all or part of an eco-
logical system or community, that is at risk of 
extinction or elimination within a State or glob-
ally. 
‘‘(B) IDENTIFICATION.—Conservation for-
est land shall be identified based on the best 
available science and data by any of— 
‘‘(i) the State in which the land is lo-
cated, unless the land is under the jurisdic-
tion of an Indian tribe; 
‘‘(ii) an Indian tribe with jurisdiction 
over the land; or 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00016
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
‘‘(iii) in consultation with the State in 
which the land is located or the Indian 
tribe with jurisdiction over the land— 
‘‘(I) the Secretary of Agriculture; 
or 
‘‘(II) the Secretary of the Inte-
rior. 
‘‘(C) EXCEPTIONS.—A tract of conserva-
tion forest land may not be removed from con-
servation forest land status under this section 
as a result of land management practices on the 
tract that— 
‘‘(i) occurred on or after the Thermal 
Renewable Energy and Efficiency Act of 
2010; and 
‘‘(ii) contributed toward the elimi-
nation of the species, or all or part of an 
ecological system or ecological community 
for which the land was identified as con-
servation forest land. 
‘‘(3) FEDERAL LAND.— 
‘‘(A) IN
GENERAL.—The term ‘Federal 
land’ means— 
‘‘(i) National Forest System land; and 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00017
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
‘‘(ii) public lands (as defined in sec-
tion 103 of the Federal Land Policy and 
Management Act of 1976 (43 U.S.C. 
1702)). 
‘‘(B) EXCLUSIONS.— 
‘‘(i) IN GENERAL.—The term ‘Federal 
land’ does not include— 
‘‘(I) any area designated by Con-
gress to be administered for conserva-
tion purposes; or 
‘‘(II) a National Monument pro-
claimed by the President. 
‘‘(ii) OLD GROWTH OR LATE SUCCES-
SIONAL FOREST STANDS.—The term ‘Fed-
eral land’ does not include an old growth 
or late successional forest stand unless bio-
mass from the stand does not exceed the 
minimum size standards for sawtimber and 
is a byproduct of an ecological restoration 
treatment that fully maintains, or contrib-
utes toward the restoration of, the struc-
ture and composition of an old growth for-
est stand in accordance with the old 
growth conditions characteristic of the for-
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00018
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
est type and retains the large trees con-
tributing to old growth structure. 
‘‘(4) INDIAN
LAND.—The term ‘Indian land’ 
has the meaning given the term ‘Indian country’ in 
section 1151 of title 18, United States Code. 
‘‘(5) INDIAN TRIBE.—The term ‘Indian tribe’ 
has the meaning given the term in section 4 of the 
Indian Self-Determination and Education Assistance 
Act (25 U.S.C. 450b). 
‘‘(6) NON-FEDERAL
LAND.—The term ‘non- 
Federal land’ means land that is not owned by the 
Federal Government. 
‘‘(7) RENEWABLE ENERGY.—The term ‘renew-
able energy’ means energy generated from solar, 
wind, biomass, landfill gas, ocean (including tidal, 
wave, current, and thermal), geothermal, municipal 
solid waste, or new hydroelectric generation capacity 
achieved from increased efficiency or additions of 
new capacity at an existing hydroelectric project. 
‘‘(8) SECRETARY CONCERNED.—The term ‘Sec-
retary concerned’ means— 
‘‘(A) the Secretary of Agriculture, with re-
gard to— 
‘‘(i) National Forest System land; and 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00019
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
‘‘(ii) except as provided by subpara-
graph (B), non-Federal land; and 
‘‘(B) the Secretary of the Interior, with re-
gard to— 
‘‘(i) public lands (as defined in section 
103 of the Federal Land Policy and Man-
agement Act of 1976 (43 U.S.C. 1702)); 
and 
‘‘(ii) Indian land.’’. 
TITLE II—EXEMPT FACILITY 
BONDS 
SEC. 201. EXEMPT FACILITY BONDS. 
(a) DEFINITION OF LOCAL DISTRICT HEATING AND 
COOLING
FACILITIES.—Subparagraph (A) of section 
142(g)(2) of the Internal Revenue Code of 1986 is amend-
ed by striking ‘‘a pipeline or network (which may be con-
nected to a heating or cooling source) providing hot water, 
chilled water, or steam’’ and inserting ‘‘equipment for pro-
ducing thermal energy in the form of hot water, chilled 
water or steam, distributing that thermal energy in pipe-
lines and transferring the thermal energy’’. 
(b) PUBLIC USE REQUIREMENT.—The Secretary 
shall promulgate regulations establishing that a local dis-
trict heating or cooling facility will be treated in all events 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00020
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
as serving a general public use for purposes of the Internal 
Revenue Code of 1986. 
TITLE 
III—ENERGY 
SUSTAIN-
ABILITY 
AND 
EFFICIENCY 
GRANTS FOR INSTITUTIONS 
SEC. 301. DEFINITION OF INSTITUTIONAL ENTITY. 
Section 399A(a)(5) of the Energy Policy and Con-
servation Act (42 U.S.C. 6371h–1(a)(5)) is amended by 
inserting ‘‘a not-for-profit district energy system,’’ after 
‘‘utility,’’. 
SEC. 302. AVAILABILITY OF GRANTS. 
Section 399A(f) of the Energy Policy and Conserva-
tion Act (42 U.S.C. 6371h–1(f)) is amended— 
(1) in paragraph (2)— 
(A) in subparagraph (A)(i), by striking 
‘‘$50,000’’ and inserting ‘‘$90,000’’; 
(B) in subparagraph (B)(i), by striking 
‘‘$90,000’’ and inserting ‘‘$150,000’’; and 
(C) in subparagraph (C)(i), by striking 
‘‘$250,000’’ and inserting ‘‘$600,000’’; and 
(2) in paragraph (3)— 
(A) in subparagraph (A), by striking 
‘‘$1,000,000’’ and inserting ‘‘$20,000,000’’; 
and 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00021
Fmt 6652
Sfmt 6201
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS
(B) in subparagraph (B), by striking ‘‘60 
percent’’ and inserting ‘‘30 percent’’. 
SEC. 
303. 
AUTHORIZATION 
OF 
APPROPRIATIONS 
FOR 
GRANTS. 
Section 399A(i)(1) of the Energy Policy and Con-
servation Act (42 U.S.C. 6371h–1(i)(1)) is amended by 
striking ‘‘$250,000,000 for each of fiscal years 2009 
through 2013’’ and inserting ‘‘$500,000,000 for each of 
fiscal years 2011 through 2015’’. 
Æ 
VerDate Mar 15 2010 
00:50 Jul 22, 2010
Jkt 089200
PO 00000
Frm 00022
Fmt 6652
Sfmt 6301
E:\BILLS\H5805.IH
H5805
tjames on DSKG8SOYB1PROD with BILLS