HR 2454 PCS
Sec. 531. Establishment of USDA Greenhouse Gas Emission Reduction and 
Sequestration Advisory Committee. 
Subtitle C—Miscellaneous 
Sec. 551. International indirect land use changes. 
Sec. 552. Biomass-based diesel. 
Sec. 553. Modification of definition of renewable biomass. 
SEC. 2. DEFINITIONS. 
For purposes of this Act: 
(1) ADMINISTRATOR.—The term ‘‘Adminis-
trator’’ means the Administrator of the Environ-
mental Protection Agency. 
(2) STATE.—The term ‘‘State’’ has the mean-
ing given that term in section 302 of the Clean Air 
Act. 
SEC. 3. INTERNATIONAL PARTICIPATION. 
The Administrator, in consultation with the Depart-
ment of State and the United States Trade Representa-
tive, shall annually prepare and certify a report to the 
Congress regarding whether China and India have adopted 
greenhouse gas emissions standards at least as strict as 
those standards required under this Act. If the Adminis-
trator determines that China and India have not adopted 
greenhouse gas emissions standards at least as stringent 
as those set forth in this Act, the Administrator shall no-
tify each Member of Congress of his determination, and 
shall release his determination to the media. 
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TITLE I—CLEAN ENERGY 
Subtitle 
A—Combined 
Efficiency 
and 
Renewable 
Electricity 
Standard 
SEC. 101. COMBINED EFFICIENCY AND RENEWABLE ELEC-
TRICITY STANDARD. 
(a) IN GENERAL.—Title VI of the Public Utility Reg-
ulatory Policies Act of 1978 (16 U.S.C. 2601 and fol-
lowing) is amended by adding at the end the following: 
‘‘SEC. 610. COMBINED EFFICIENCY AND RENEWABLE ELEC-
TRICITY STANDARD. 
‘‘(a) DEFINITIONS.—For purposes of this section: 
‘‘(1) CHP SAVINGS.—The term ‘CHP savings’ 
means— 
‘‘(A) CHP system savings from a combined 
heat and power system that commences oper-
ation after the date of enactment of this sec-
tion; and 
‘‘(B) the increase in CHP system savings 
from, at any time after the date of the enact-
ment of this section, upgrading, replacing, ex-
panding, or increasing the utilization of a com-
bined heat and power system that commenced 
operation on or before the date of enactment of 
this section. 
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‘‘(2) CHP SYSTEM SAVINGS.—The term ‘CHP 
system savings’ means the increment of electric out-
put of a combined heat and power system that is at-
tributable to the higher efficiency of the combined 
system (as compared to the efficiency of separate 
production of the electric and thermal outputs). 
‘‘(3) COMBINED HEAT AND POWER SYSTEM.— 
The term ‘combined heat and power system’ means 
a system that uses the same energy source both for 
the generation of electrical or mechanical power and 
the production of steam or another form of useful 
thermal energy, provided that— 
‘‘(A) the system meets such requirements 
relating to efficiency and other operating char-
acteristics as the Commission may promulgate 
by regulation; and 
‘‘(B) the net sales of electricity by the fa-
cility to customers not consuming the thermal 
output from that facility will not exceed 50 per-
cent of total annual electric generation by the 
facility. 
‘‘(4) CUSTOMER FACILITY SAVINGS.—The term 
‘customer facility savings’ means a reduction in end- 
use electricity consumption (including recycled en-
ergy savings) at a facility of an end-use consumer of 
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electricity served by a retail electric supplier, as 
compared to— 
‘‘(A) in the case of a new facility, con-
sumption at a reference facility of average effi-
ciency; 
‘‘(B) in the case of an existing facility, 
consumption at such facility during a base pe-
riod, except as provided in subparagraphs (C) 
and (D); 
‘‘(C) in the case of new equipment that re-
places existing equipment with remaining useful 
life, the projected consumption of the existing 
equipment for the remaining useful life of such 
equipment, and thereafter, consumption of new 
equipment of average efficiency of the same 
equipment type; and 
‘‘(D) in the case of new equipment that re-
places existing equipment at the end of the use-
ful life of the existing equipment, consumption 
by new equipment of average efficiency of the 
same equipment type. 
‘‘(5) DISTRIBUTED
RENEWABLE
GENERATION 
FACILITY.—The term ‘distributed renewable genera-
tion facility’ means a facility that— 
‘‘(A) generates renewable electricity; 
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‘‘(B) primarily serves 1 or more electricity 
consumers at or near the facility site; and 
‘‘(C) is no greater than— 
‘‘(i) 2 megawatts in capacity; or 
‘‘(ii) 4 megawatts in capacity, in the 
case of a facility that is placed in service 
after the date of enactment of this section 
and generates electricity from a renewable 
energy resource other than by means of 
combustion. 
‘‘(6) ELECTRICITY SAVINGS.—The term ‘elec-
tricity savings’ means reductions in electricity con-
sumption, relative to business-as-usual projections, 
achieved through measures implemented after the 
date of enactment of this section, limited to— 
‘‘(A) customer facility savings of elec-
tricity, adjusted to reflect any associated in-
crease in fuel consumption at the facility; 
‘‘(B) reductions in distribution system 
losses of electricity achieved by a retail elec-
tricity distributor, as compared to losses attrib-
utable to new or replacement distribution sys-
tem equipment of average efficiency; 
‘‘(C) CHP savings; and 
‘‘(D) fuel cell savings. 
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‘‘(7) CENTRAL
PROCUREMENT
STATE.—The 
term ‘central procurement State’ means a State 
that, as of January 1, 2009, had adopted and imple-
mented a legally enforceable mandate that, in lieu of 
requiring utilities to submit credits or certificates 
issued based on generation of electricity from (or to 
purchase or generate electricity from) resources de-
fined by the State as renewable, requires retail elec-
tric suppliers to collect payments from electricity 
ratepayers within the State that are used for central 
procurement, by a State agency or a public benefit 
corporation established pursuant to State law, of 
credits or certificates issued based on generation of 
electricity from resources defined by the State as re-
newable. 
‘‘(8) 
FEDERAL
RENEWABLE
ELECTRICITY 
CREDIT.—The term ‘Federal renewable electricity 
credit’ means a credit, representing one megawatt 
hour of renewable electricity, issued pursuant to sub-
section (e). 
‘‘(9) FUEL CELL.—The term ‘fuel cell’ means a 
device that directly converts the chemical energy of 
a fuel and an oxidant into electricity by electro-
chemical processes occurring at separate electrodes 
in the device. 
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‘‘(10) FUEL
CELL
SAVINGS.—The term ‘fuel 
cell savings’ means the electricity saved by a fuel cell 
that is installed after the date of enactment of this 
section, or by upgrading a fuel cell that commenced 
operation on or before the date of enactment of this 
section, as a result of the greater efficiency with 
which the fuel cell transforms fuel into electricity as 
compared with sources of electricity delivered 
through the grid, provided that— 
‘‘(A) the fuel cell meets such requirements 
relating to efficiency and other operating char-
acteristics as the Commission may promulgate 
by regulation; and 
‘‘(B) the net sales of electricity from the 
fuel cell to customers not consuming the ther-
mal output from the fuel cell, if any, do not ex-
ceed 50 percent of the total annual electricity 
generation by the fuel cell. 
‘‘(11) 
OTHER
QUALIFYING
ENERGY
RE-
SOURCE.—The term ‘other qualifying energy re-
source’ means any of the following: 
‘‘(A) Landfill gas. 
‘‘(B) Wastewater treatment gas. 
‘‘(C) Coal mine methane used to generate 
electricity at or near the mine mouth. 
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‘‘(D) Qualified waste-to-energy. 
‘‘(12) QUALIFIED
HYDROPOWER.—The term 
‘qualified hydropower’ means— 
‘‘(A) energy produced from increased effi-
ciency achieved, or additions of capacity made, 
on or after January 1, 1988, at a hydroelectric 
facility that was placed in service before that 
date and does not include additional energy 
generated as a result of operational changes not 
directly associated with efficiency improvements 
or capacity additions; or 
‘‘(B) energy produced from generating ca-
pacity added to a dam on or after January 1, 
1988, provided that the Commission certifies 
that— 
‘‘(i) the dam was placed in service be-
fore the date of the enactment of this sec-
tion and was operated for flood control, 
navigation, or water supply purposes and 
was not producing hydroelectric power 
prior to the addition of such capacity; 
‘‘(ii) the hydroelectric project installed 
on the dam is licensed (or is exempt from 
licensing) by the Commission and is in 
compliance with the terms and conditions 
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of the license or exemption, and with other 
applicable legal requirements for the pro-
tection of environmental quality, including 
applicable fish passage requirements; and 
‘‘(iii) the hydroelectric project in-
stalled on the dam is operated so that the 
water surface elevation at any given loca-
tion and time that would have occurred in 
the absence of the hydroelectric project is 
maintained, subject to any license or ex-
emption requirements that require changes 
in water surface elevation for the purpose 
of improving the environmental quality of 
the affected waterway. 
‘‘(13) 
QUALIFIED
WASTE-TO-ENERGY.—The 
term ‘qualified waste-to-energy’ means energy from 
the combustion of municipal solid waste or construc-
tion, demolition, or disaster debris, or from the gas-
ification or pyrolization of such waste or debris and 
the combustion of the resulting gas at the same fa-
cility, provided that— 
‘‘(A) such term shall include only the en-
ergy derived from the non-fossil biogenic por-
tion of such waste or debris; 
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‘‘(B) the Commission determines, with the 
concurrence of the Administrator of the Envi-
ronmental Protection Agency, that the total 
lifecycle greenhouse gas emissions attributable 
to the generation of electricity from such waste 
or debris are lower than those attributable to 
the likely alternative method of disposing of 
such waste or debris; and 
‘‘(C) the owner or operator of the facility 
generating electricity from such energy provides 
to the Commission, on an annual basis— 
‘‘(i) a certification that the facility is 
in compliance with all applicable State, 
tribal, and Federal environmental permits; 
‘‘(ii) in the case of a facility that com-
menced operation before the date of enact-
ment of this section, a certification that 
the facility meets emissions standards pro-
mulgated under section 112 or 129 of the 
Clean Air Act (42 U.S.C. 7412 or 7429) 
that apply as of the date of enactment of 
this section to new facilities within the rel-
evant source category; and 
‘‘(iii) in the case of the combustion, 
pyrolization, or gasification of municipal 
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solid waste, a certification that each local 
government unit from which such waste 
originates operates, participates in the op-
eration of, contracts for, or otherwise pro-
vides for, recycling services for its resi-
dents. 
‘‘(14) RECYCLED ENERGY SAVINGS.—The term 
‘recycled energy savings’ means a reduction in elec-
tricity consumption that results from a modification 
of an industrial or commercial system that com-
menced operation before the date of enactment of 
this section, in order to recapture electrical, mechan-
ical, or thermal energy that would otherwise be 
wasted. 
‘‘(15) RENEWABLE
BIOMASS.—The term ‘re-
newable biomass’ means any of the following: 
‘‘(A) Materials, pre-commercial thinnings, 
or removed invasive species from National For-
est System land and public lands (as defined in 
section 103 of the Federal Land Policy and 
Management Act of 1976 (43 U.S.C. 1702)), 
including those that are byproducts of preven-
tive treatments (such as trees, wood, brush, 
thinnings, chips, and slash), that are removed 
as part of a federally recognized timber sale, or 
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that are removed to reduce hazardous fuels, to 
reduce or contain disease or insect infestation, 
or to restore ecosystem health, and that are— 
‘‘(i) not from components of the Na-
tional Wilderness Preservation System, 
Wilderness 
Study 
Areas, 
Inventoried 
Roadless Areas, old growth stands, late- 
successional stands (except for dead, se-
verely damaged, or badly infested trees), 
components of the National Landscape 
Conservation 
System, 
National 
Monu-
ments, National Conservation Areas, Des-
ignated Primitive Areas, or Wild and Sce-
nic Rivers corridors; 
‘‘(ii) harvested in environmentally sus-
tainable quantities, as determined by the 
appropriate Federal land manager; and 
‘‘(iii) harvested in accordance with 
Federal and State law, and applicable land 
management plans. 
‘‘(B) Any organic matter that is available 
on a renewable or recurring basis from non- 
Federal land or land belonging to an Indian or 
Indian tribe that is held in trust by the United 
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States or subject to a restriction against alien-
ation imposed by the United States, including— 
‘‘(i) renewable plant material, includ-
ing— 
‘‘(I) feed grains; 
‘‘(II) other agricultural commod-
ities; 
‘‘(III) other plants and trees; and 
‘‘(IV) algae; and 
‘‘(ii) waste material, including— 
‘‘(I) crop residue; 
‘‘(II) other vegetative waste ma-
terial (including wood waste and wood 
residues); 
‘‘(III) animal waste and byprod-
ucts (including fats, oils, greases, and 
manure); 
‘‘(IV) construction waste; and 
‘‘(V) food waste and yard waste. 
‘‘(C) Residues and byproducts from wood, 
pulp, or paper products facilities. 
‘‘(16) RENEWABLE
ELECTRICITY.—The term 
‘renewable electricity’ means electricity generated 
(including by means of a fuel cell) from a renewable 
energy resource or other qualifying energy resources. 
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‘‘(17) RENEWABLE
ENERGY
RESOURCE.—The 
term ‘renewable energy resource’ means each of the 
following: 
‘‘(A) Wind energy. 
‘‘(B) Solar energy. 
‘‘(C) Geothermal energy. 
‘‘(D) Renewable biomass. 
‘‘(E) Biogas derived exclusively from re-
newable biomass. 
‘‘(F) Biofuels derived exclusively from re-
newable biomass. 
‘‘(G) Qualified hydropower. 
‘‘(H) Marine and hydrokinetic renewable 
energy, as that term is defined in section 632 
of the Energy Independence and Security Act 
of 2007 (42 U.S.C. 17211). 
‘‘(18) RETAIL ELECTRIC SUPPLIER.— 
‘‘(A) IN GENERAL.—The term ‘retail elec-
tric supplier’ means, for any given year, an 
electric utility that sold not less than 4,000,000 
megawatt hours of electric energy to electric 
consumers for purposes other than resale dur-
ing the preceding calendar year. 
‘‘(B) INCLUSIONS AND LIMITATIONS.—For 
purposes of determining whether an electric 
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utility qualifies as a retail electric supplier 
under subparagraph (A)— 
‘‘(i) the sales of any affiliate of an 
electric utility to electric consumers, other 
than sales to the affiliate’s lessees or ten-
ants, for purposes other than resale shall 
be considered to be sales of such electric 
utility; and 
‘‘(ii) sales by any electric utility to an 
affiliate, lessee, or tenant of such electric 
utility shall not be treated as sales to elec-
tric consumers. 
‘‘(C) AFFILIATE.—For purposes of this 
paragraph, the term ‘affiliate’ when used in re-
lation to a person, means another person that 
directly or indirectly owns or controls, is owned 
or controlled by, or is under common ownership 
or control with, such person, as determined 
under regulations promulgated by the Commis-
sion. 
‘‘(19) RETAIL
ELECTRIC
SUPPLIER’S
BASE 
AMOUNT.—The term ‘retail electric supplier’s base 
amount’ means the total amount of electric energy 
sold by the retail electric supplier, expressed in 
megawatt hours, to electric customers for purposes 
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other than resale during the relevant calendar year, 
excluding— 
‘‘(A) electricity generated by a hydro-
electric facility that is not qualified hydropower; 
‘‘(B) electricity generated by a nuclear 
generating unit placed in service after the date 
of enactment of this section; and 
‘‘(C) the proportion of electricity generated 
by a fossil-fueled generating unit that is equal 
to the proportion of greenhouse gases produced 
by such unit that are captured and geologically 
sequestered. 
‘‘(20) RETIRE AND RETIREMENT.—The terms 
‘retire’ and ‘retirement’ with respect to a Federal re-
newable electricity credit, means to disqualify such 
credit for any subsequent use under this section, re-
gardless of whether the use is a sale, transfer, ex-
change, or submission in satisfaction of a compliance 
obligation. 
‘‘(21) THIRD-PARTY EFFICIENCY PROVIDER.— 
The term ‘third-party efficiency provider’ means any 
retailer, building owner, energy service company, fi-
nancial institution or other commercial, industrial or 
nonprofit entity that is capable of providing elec-
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tricity savings in accordance with the requirements 
of this section. 
‘‘(22) TOTAL ANNUAL ELECTRICITY SAVINGS.— 
The term ‘total annual electricity savings’ means 
electricity savings during a specified calendar year 
from measures implemented since the date of the en-
actment of this section, taking into account verified 
measure lifetimes or verified annual savings attrition 
rates, as determined in accordance with such regula-
tions as the Commission may promulgate and meas-
ured in megawatt hours. 
‘‘(b) ANNUAL COMPLIANCE OBLIGATION.— 
‘‘(1) IN GENERAL.—For each of calendar years 
2012 through 2039, not later than March 31 of the 
following calendar year, each retail electric supplier 
shall submit to the Commission an amount of Fed-
eral renewable electricity credits and demonstrated 
total annual electricity savings that, in the aggre-
gate, is equal to such retail electric supplier’s annual 
combined target as set forth in subsection (d), ex-
cept as otherwise provided in subsection (h). 
‘‘(2) DEMONSTRATION OF SAVINGS.—For pur-
poses of this subsection, submission of demonstrated 
total annual electricity savings means submission of 
a report that demonstrates, in accordance with the 
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‘‘(B) In the case of a unit commencing op-
eration after January 1, 2019, by the product 
of— 
‘‘(i) 20 percent; and 
‘‘(ii) the number of years between— 
‘‘(I) the commencement of oper-
ation of such covered EGU; and 
‘‘(II) the first year that such cov-
ered EGU achieves (and thereafter 
maintains) an emission limit that is at 
least a 50 percent reduction in emis-
sions of the carbon dioxide produced 
by the unit, measured on an annual 
basis, as determined in accordance 
with section 812(b)(2). 
‘‘(3) COVERED
EGUS
INITIALLY
PERMITTED 
FROM 2015 THROUGH 2019.—The owner or operator 
of a covered EGU that is initially permitted on or 
after January 1, 2015, and before January 1, 2020, 
shall be ineligible to receive emission allowances pur-
suant to this section if such unit, upon commence-
ment of operations (and thereafter), does not achieve 
and maintain an emission limit that is at least a 50 
percent reduction in emissions of the carbon dioxide 
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