amount of electric energy that the household appli-
ance is capable of consuming without being com-
pletely switched off.
‘‘(2)(A) Except as provided in subparagraph (B), a
household appliance that is manufactured in, or imported
for sale in, the United States on or after the date that
is 2 years after the date of enactment of this subsection
shall not consume in standby mode more than 1 watt.
‘‘(B)(i) A household appliance model that, as of the
date of enactment of this subsection, is recognized under
the Energy Star program administered by the Adminis-
trator of the Environmental Protection Agency and the
Secretary shall have until January 1, 2005, to meet the
standard under subparagraph (A).
‘‘(ii) In the case of analog televisions, the Secretary
shall prescribe, on or after the date that is 2 years after
the date of enactment of this subsection, in accordance
with subsections (o) and (p) of section 325, an energy con-
servation standard that is technologically feasible and eco-
nomically justified under section 325(o)(2)(A) (in lieu of
the 1 watt standard under subparagraph (A)).
‘‘(3)(A) A manufacturer or importer of a household
appliance may submit to the Secretary an application for
an exemption of the household appliance from the stand-
ard under paragraph (2).
‘‘(B) The Secretary shall grant an exemption for a
household appliance for which an application is made
under subparagraph (A) if the applicant provides evidence
showing that, and the Secretary determines that—
‘‘(i) it is not technically feasible to modify the
household appliance to enable the household appli-
ance to meet the standard;
‘‘(ii) the standard is incompatible with an en-
ergy efficiency standard applicable to the household
appliance under another subsection; or
‘‘(iii) the cost of electricity that a typical con-
sumer would save in operating the household appli-
ance meeting the standard would not equal the in-
crease in the price of the household appliance that
would be attributable to the modifications that
would be necessary to enable the household appli-
ance to meet the standard by the earlier of—
‘‘(I) the date that is 7 years after the date
of purchase of the household appliance; or
‘‘(II) the end of the useful life of the
household appliance.
‘‘(C) If the Secretary determines that it is not tech-
nically feasible to modify a household appliance to meet
the standard under paragraph (2), the Secretary shall es-
tablish a different standard for the household appliance
in accordance with the criteria under subsection (l).
‘‘(4)(A) Not later than 1 year after the date of enact-
ment of this subsection, the Secretary shall establish a test
procedure for determining the amount of consumption of
power by a household appliance operating in standby
mode.
‘‘(B) In establishing the test procedure, the Secretary
shall consider—
‘‘(i) international test procedures under devel-
opment;
‘‘(ii) test procedures used in connection with
the Energy Star program; and
‘‘(iii) test procedures used for measuring power
consumption in standby mode in other countries.
‘‘(5) FURTHER
REDUCTION
OF
STANDBY
POWER
CONSUMPTION.—The Secretary shall provide technical as-
sistance to manufacturers in achieving further reductions
in standby mode electric energy consumption by household
appliances.
‘‘(v) STANDBY MODE ELECTRIC ENERGY CONSUMP-
TION
BY DIGITAL TELEVISIONS, DIGITAL SET TOP
BOXES, AND DIGITAL VIDEO RECORDERS.—The Sec-
retary shall initiate on January 1, 2007 a rulemaking to
prescribe, in accordance with subsections (o) and (p), an
energy conservation standard of standby mode electric en-
ergy consumption by digital television sets, digital set top
boxes, and digital video recorders. The Secretary shall
issue a final rule prescribing such standards not later than
18 months thereafter. In determining whether a standard
under this section is technologically feasible and economi-
cally justified under section 325(o)(2)(A), the Secretary
shall consider the potential effects on market penetration
by digital products covered under this section, and shall
consider any recommendations by the FCC regarding such
effects.’’.
(2) Section 325(n)(1) of the Energy Policy and Con-
servation Act (42 U.S.C. 6295(n)(1)) is amended by strik-
ing ‘‘(11), and in paragraphs (13) and’’.
(b) STANDARDS
FOR NONCOVERED PRODUCTS.—
Section 325(m) of the Energy Policy and Conservation
Act (42 U.S.C. 6295(m)) is amended as follows:
(1) Inserting ‘‘(1)’’ before ‘‘After’’.
(2) Inserting the following at the end:
(2) ‘‘Not later than one year after the date of enact-
ment of the Energy Advancement and Conservation Act
of 2001, the Secretary shall conduct a rulemaking to de-
termine whether consumer products not classified as a
covered product under section 322(a)(1) through (18)
meet the criteria of section 322(b)(1). If the Secretary
finds that a consumer product not classified as a covered
product meets the criteria of section 322(b)(1), he shall
prescribe, in accordance with subsections (o) and (p), an
energy conservation standard for such consumer product,
if such standard is reasonably probable to be techno-
logically feasible and economically justified within the
meaning of subsection (o)(2)(A).’’.
(c) CONSUMER EDUCATION ON ENERGY EFFICIENCY
BENEFITS OF AIR CONDITIONING, HEATING AND VEN-
TILATION MAINTENANCE.—Section 337 of the Energy
Policy and Conservation Act (42 U.S.C. 6307) is amended
by adding the following new subsection after subsection
(b):
‘‘(c) HVAC MAINTENANCE.—For the purpose of en-
suring that installed air conditioning and heating systems
operate at their maximum rated efficiency levels, the Sec-
retary shall, within 180 days of the date of enactment of
this subsection, develop and implement a public education
campaign to educate homeowners and small business own-
ers concerning the energy savings resulting from regularly
scheduled maintenance of air conditioning, heating, and
ventilating systems. In developing and implementing this
campaign, the Secretary shall consider support by the De-
partment of public education programs sponsored by trade
and professional or energy efficiency organizations. The
public service information shall provide sufficient informa-
tion to allow consumers to make informed choices from
among professional, licensed (where State or local licens-
ing is required) contractors. There are authorized to be
appropriated to carry out this subsection $5,000,000 for
fiscal years 2002 and 2003 in addition to amounts other-
wise appropriated in this part.’’.
(d) EFFICIENCY STANDARDS FOR FURNACE FANS,
CEILING
FANS, 
AND
COLD
DRINK
VENDING
MA-
CHINES..—
(1) DEFINITIONS.—Section 321 of the Energy
Policy and Conservation Act (42 U.S.C. 6291) is
amended by adding the following at the end thereof:
‘‘(32) The term ‘residential furnace fan’ means
an electric fan installed as part of a furnace for pur-
poses of circulating air through the system air fil-
ters, the heat exchangers or heating elements of the
furnace, and the duct work.
‘‘(33) The terms ‘residential central air condi-
tioner fan’ and ‘heat pump circulation fan’ mean an
electric fan installed as part of a central air condi-
tioner or heat pump for purposes of circulating air
through the system air filters, the heat exchangers
of the air conditioner or heat pump, and the duct
work.
‘‘(34) The term ‘suspended ceiling fan’ means
a fan intended to be mounted to a ceiling outlet box,
ceiling building structure, or to a vertical rod sus-
pended from the ceiling, and which as blades which
rotate below the ceiling and consists of an electric
motor, fan blades (which rotate in a direction par-
allel to the floor), an optional lighting kit, and one
or more electrical controls (integral or remote) gov-
erning fan speed and lighting operation.
‘‘(35) The term ‘refrigerated bottled or canned
beverage vending machine’ means a machine that
cools bottled or canned beverages and dispenses
them upon payment.’’.
(2) TESTING REQUIREMENTS.—Section 323 of
the Energy Policy and Conservation Act (42 U.S.C.
6293) is amended by adding the following at the end
thereof:
‘‘(f) ADDITIONAL CONSUMER PRODUCTS.—The Sec-
retary shall within 18 months after the date of enactment
of this subsection prescribe testing requirements for resi-
dential furnace fans, residential central air conditioner
fans, heat pump circulation fans, suspended ceiling fans,
and refrigerated bottled or canned beverage vending ma-
chines. Such testing requirements shall be based on exist-
ing test procedures used in industry to the extent practical
and reasonable. In the case of residential furnace fans,
residential central air conditioner fans, heat pump circula-
tion fans, and suspended ceiling fans, such test procedures
shall include efficiency at both maximum output and at
an output no more than 50 percent of the maximum out-
put.’’.
(3) STANDARDS FOR ADDITIONAL CONSUMER
PRODUCTS.—Section 325 of the Energy Policy and
Conservation Act (42 U.S.C. 6295) is amended by
adding the following at the end thereof:
‘‘(w) RESIDENTIAL FURNACE FANS, CENTRAL AIR
AND HEAT PUMP CIRCULATION FANS, SUSPENDED CEIL-
ING FANS, AND VENDING MACHINES.—(1) The Secretary
shall, within 18 months after the date of enactment of this
subsection, assess the current and projected future market
for residential furnace fans, residential central air condi-
tioner and heat pump circulation fans, suspended ceiling
fans, and refrigerated bottled or canned beverage vending
machines. This assessment shall include an examination
of the types of products sold, the number of products in
use, annual sales of these products, energy used by these
products sold, the number of products in use, annual sales
of these products, energy used by these products, esti-
mates of the potential energy savings from specific tech-
nical improvements to these products, and an examination
of the cost-effectiveness of these improvements. Prior to
the end of this time period, the Secretary shall hold an
initial scoping workshop to discuss and receive input to
plans for developing minimum efficiency standards for
these products.
‘‘(2) The Secretary shall within 24 months after the
date on which testing requirements are prescribed by the
Secretary pursuant to section 323(f), prescribe, by rule,
energy conservation standards for residential furnace fans,
residential central air conditioner and heat pump circula-
tion fans, suspended ceiling fans, and refrigerated bottled
or canned beverage vending machines. In establishing
these standards, the Secretary shall use the criteria and
procedures contained in subsections (l) and (m). Any
standard prescribed under this section shall apply to prod-
ucts manufactured 36 months after the date such rule is
published.’’.
(4) LABELING.—Section 324(a) of the Energy
Policy and Conservation Act (42 U.S.C. 6294(a)) is
amended by adding the following at the end thereof:
‘‘(5) The Secretary shall within 6 months after the
date on which energy conservation standards are pre-
scribed by the Secretary for covered products referred to
in section 325(w), prescribe, by rule, labeling requirements
for such products. These requirements shall take effect on
the same date as the standards prescribed pursuant to sec-
tion 325(w).’’.
(5) COVERED PRODUCTS.—Section 322(a) of
the Energy Policy and Conservation Act (42 U.S.C.
6292(a)) is amended by redesignating paragraph
(19) as paragraph (20) and by inserting after para-
graph (18) the following:
‘‘(19) Beginning on the effective date for stand-
ards established pursuant to subsection (v) of sec-
tion 325, each product referred to in such subsection
(v).’’.
Subtitle E—Energy Efficient
Vehicles
SEC. 151. HIGH OCCUPANCY VEHICLE EXCEPTION.
(a) 
IN
GENERAL.—Notwithstanding 
section
102(a)(1) of title 23, United States Code, a State may,
for the purpose of promoting energy conservation, permit
a vehicle with fewer than 2 occupants to operate in high
occupancy vehicle lanes if such vehicle is a hybrid vehicle
or is fueled by an alternative fuel.
(b) HYBRID VEHICLE DEFINED.—In this section, the
term ‘‘hybrid vehicle’’ means a motor vehicle—
(1) which draws propulsion energy from on-
board sources of stored energy which are both—
(A) an internal combustion or heat engine
using combustible fuel; and
(B) a rechargeable energy storage system;
(2) which, in the case of a passenger automobile
or light truck—
(A) for 2002 and later model vehicles, has
received a certificate of conformity under sec-
tion 206 of the Clean Air Act (42 U.S.C. 7525)
and meets or exceeds the equivalent qualifying
California low emission vehicle standard under
section 243(e)(2) of the Clean Air Act (42
U.S.C. 7583(e)(2)) for that make and model
year; and
(B) for 2004 and later model vehicles, has
received a certificate that such vehicle meets
the Tier II emission level established in regula-
tions prescribed by the Administrator of the
Environmental Protection Agency under section
202(i) of the Clean Air Act (42 U.S.C. 7521(i))
for that make and model year vehicle; and
(3) which is made by a manufacturer.
(c) ALTERNATIVE FUEL DEFINED.—In this section,
the term ‘‘alternative fuel’’ has the meaning such term has
under section 301(2) of the Energy Policy Act of 1992
(42 U.S.C. 13211(2)).
SEC. 152. RAILROAD EFFICIENCY.
(a) LOCOMOTIVE TECHNOLOGY DEMONSTRATION.—
The Secretary of Energy shall establish a public-private
research partnership with railroad carriers, locomotive
manufacturers, and a world-class research and test center
dedicated to the advancement of railroad technology, effi-
ciency, and safety that is owned by the Federal Railroad
Administration and operated in the private sector, for the
development and demonstration of locomotive technologies
that increase fuel economy, reduce emissions, improve
safety, and lower costs.
(b) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated to the Secretary of En-
ergy $25,000,000 for fiscal year 2002, $30,000,000 for
fiscal year 2003, and $35,000,000 for fiscal year 2004 for
carrying out this section.
SEC. 153. BIODIESEL FUEL USE CREDITS.
Section 312(c) of the Energy Policy Act of 1992 (42
U.S.C. 13220(c)) is amended—
(1) by striking ‘‘NOT’’ in the subsection head-
ing; and
(2) by striking ‘‘not’’.
SEC. 154. MOBILE TO STATIONARY SOURCE TRADING.
Within 90 days after the enactment of this section,
the Administrator of the Environmental Protection Agen-
cy is directed to commence a review of the Agency’s poli-
cies regarding the use of mobile to stationary source trad-
ing of emission credits under the Clean Air Act to deter-
mine whether such trading can provide both nonattain-
ment and attainment areas with additional flexibility in
achieving and maintaining healthy air quality and increas-
ing use of alternative fuel and advanced technology vehi-
cles, thereby reducing United States dependence on for-
eign oil.
Subtitle F—Other Provisions
SEC. 161. REVIEW OF REGULATIONS TO ELIMINATE BAR-
RIERS TO EMERGING ENERGY TECHNOLOGY.
(a) IN GENERAL.—Each Federal agency shall carry
out a review of its regulations and standards to determine
those that act as a barrier to market entry for emerging
energy-efficient technologies, including, but not limited to,
fuel cells, combined heat and power, and distributed gen-
eration (including small-scale renewable energy).
(b) REPORT
TO CONGRESS.—No later than 18
months after the date of enactment of this section, each
agency shall provide a report to Congress and the Presi-
dent detailing all regulatory barriers to emerging energy-
efficient technologies, along with actions the agency in-
tends to take, or has taken, to remove such barriers.
(c) PERIODIC REVIEW.—Each agency shall subse-
quently review its regulations and standards in the man-
ner specified in this section no less frequently than every
5 years, and report their findings to Congress and the
President. Such reviews shall include a detailed analysis
of all agency actions taken to remove existing barriers to
emerging energy technologies.
SEC. 162. ADVANCED IDLE ELIMINATION SYSTEMS.
(a) DEFINITIONS.—
(1) ADVANCED IDLE ELIMINATION SYSTEM.—
The term ‘‘advanced idle elimination system’’ means
a device or system of devices that is installed at a
truck stop or other location (for example, a loading,
unloading, or transfer facility) where vehicles (such
as trucks, trains, buses, boats, automobiles, and rec-
reational vehicles) are parked and that is designed
to provide to the vehicle the services (such as heat,
air conditioning, and electricity) that would other-
wise require the operation of the auxiliary or drive
train engine or both while the vehicle is stationary
and parked.
(2) EXTENDED IDLING.—The term ‘‘extended
idling’’ means the idling of a motor vehicle for a pe-
riod greater than 60 minutes.
(b) RECOGNITION OF BENEFITS OF ADVANCED IDLE
ELIMINATION SYSTEMS.—Within 90 days after the date
of enactment of this subsection, the Administrator of the
Environmental Protection Agency is directed to commence
a review of the Agency’s mobile source air emissions mod-
els used under the Clean Air Act to determine whether
such models accurately reflect the emissions resulting
from extended idling of heavy-duty trucks and other vehi-
cles and engines, and shall update those models as the
Administrator deems appropriate. Additionally, within 90-
days after the date of enactment of this subsection, the
Administrator shall commence a review as to the appro-
priate emissions reductions credit that should be allotted
under the Clean Air Act for the use of advanced idle elimi-
nation systems, and whether such credits should be sub-
ject to an emissions trading system, and shall revise Agen-
cy regulations and guidance as the Administrator deems
appropriate.
SEC. 163. STUDY OF BENEFITS AND FEASIBILITY OF OIL BY-
PASS FILTRATION TECHNOLOGY.
(a) STUDY.—The Secretary of Energy and the Ad-
ministrator of the Environmental Protection Agency shall
jointly conduct a study of oil bypass filtration technology
in motor vehicle engines. The study shall analyze and
quantify the potential benefits of such technology in terms
of reduced demand for oil and the potential environmental
benefits of the technology in terms of reduced waste and
air pollution. The Secretary and the Administrator shall
also examine the feasibility of using such technology in
the Federal motor vehicle fleet.
(b) REPORT.—Not later than 6 months after the en-
actment of this Act, the Secretary of Energy and the Ad-
ministrator of the Environmental Protection Agency shall
jointly submit a report containing the results of the study
conducted under subsection (a) to the Committee on En-
ergy and Commerce of the United States House of Rep-
resentatives and to the Committee on Energy and Natural
Resources of the United States Senate.
SEC. 164. GAS FLARE STUDY.
(a) STUDY.—The Secretary of Energy shall conduct
a study of the economic feasibility of installing small co-
generation facilities utilizing excess gas flares at petro-
chemical facilities to provide reduced electricity costs to
customers living within 3 miles of the petrochemical facili-
ties. The Secretary shall solicit public comment to assist
in preparing the report required under subsection (b).
(b) REPORT.—Not later than 18 months after the
date of the enactment of this Act, the Secretary of Energy
shall transmit a report to the Congress on the results of
the study conducted under subsection (a).
SEC. 165. TELECOMMUTING STUDY.
(a) STUDY REQUIRED.—The Secretary, in consulta-
tion with Commission, and the NTIA, shall conduct a
study of the energy conservation implications of the wide-
spread adoption of telecommuting in the United States.
(b) REQUIRED SUBJECTS OF STUDY.—The study re-
quired by subsection (a) shall analyze the following sub-
jects in relation to the energy saving potential of telecom-
muting:
(1) Reductions of energy use and energy costs
in commuting and regular office heating, cooling,
and other operations.
(2) Other energy reductions accomplished by
telecommuting.
(3) Existing regulatory barriers that hamper
telecommuting, including barriers to broadband tele-
communications services deployment.
(4) Collateral benefits to the environment, fam-
ily life, and other values.
(c) REPORT REQUIRED.—The Secretary shall submit
to the President and the Congress a report on the study
required by this section not later than 6 months after the
date of enactment of this Act. Such report shall include
a description of the results of the analysis of each of the
subject described in subsection (b).
(d) DEFINITIONS.—As used in this section:
(1) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of Energy.
(2) COMMISSION.—The term ‘‘Commission’’
means the Federal Communications Commission.
(3) NTIA.—The term ‘‘NTIA’’ means the Na-
tional Telecommunications and Information Admin-
istration of the Department of Commerce.
(4) TELECOMMUTING.—The term ‘‘telecom-
muting’’ means the performance of work functions
using communications technologies, thereby elimi-
nating or substantially reducing the need to com-
mute to and from traditional worksites.
TITLE II—AUTOMOBILE FUEL
ECONOMY
SEC. 201. AVERAGE FUEL ECONOMY STANDARDS FOR NON-
PASSENGER AUTOMOBILES.
Section 32902(a) of title 49, United States Code, is
amended—
(1) by inserting ‘‘(1)’’ after ‘‘NONPASSENGER
AUTOMOBILES.—’’; and
(2) by adding at the end the following:
‘‘(2) The Secretary shall prescribe under paragraph
(1) average fuel economy standards for automobiles (ex-
cept passenger automobiles) manufactured in model years
2004 through 2010 that are calculated to ensure that the
aggregate amount of gasoline projected to be used in those
model years by automobiles to which the standards apply
is at least 5 billion gallons less than the aggregate amount
of gasoline that would be used in those model years by
such automobiles if they achieved only the fuel economy
required under the average fuel economy standard that ap-
plies under this subsection to automobiles (except pas-
senger automobiles) manufactured in model year 2002.’’.
SEC. 202. CONSIDERATION OF PRESCRIBING DIFFERENT
AVERAGE FUEL ECONOMY STANDARDS FOR
NONPASSENGER AUTOMOBILES.
(a) IN GENERAL.—The Secretary of Transportation
shall, in prescribing average fuel economy standards under
section 32902(a) of title 49, United States Code, for auto-
mobiles (except passenger automobiles) manufactured in
model year 2004, consider the potential benefits of—
(1) establishing a weight-based system for auto-
mobiles, that is based on the inertia weight, curb
weight, gross vehicle weight rating, or another ap-
propriate measure of such automobiles; and
(2) prescribing different fuel economy standards
for automobiles that are subject to the weight-based
system.
(b) SPECIFIC CONSIDERATIONS.—In implementing
this section the Secretary—
(1) shall consider any recommendations made
in the National Academy of Sciences study com-
pleted pursuant to the Department of Transpor-
tation and Related Agencies Appropriations Act,
2000 (Public Law 106–346; 114 Stat. 2763 et seq.);
and
(2) shall evaluate the merits of any weight-
based system in terms of motor vehicle safety, en-
ergy conservation, and competitiveness of and em-
ployment in the United States automotive sector,
and if a weight-based system is established by the
Secretary a manufacturer may trade credits between
or among the automobiles (except passenger auto-
mobiles) manufactured by the manufacturer.
SEC. 203. DUAL FUELED AUTOMOBILES.
(a) PURPOSES.—The purposes of this section are—
(1) to extend the manufacturing incentives for
dual fueled automobiles, as set forth in subsections
(b) and (d) of section 32905 of title 49, United
States Code, through the 2008 model year; and
(2) to similarly extend the limitation on the
maximum average fuel economy increase for such
automobiles, as set forth in subsection (a)(1) of sec-
tion 32906 of title 49, United States Code.
(b) AMENDMENTS.—
(1) 
MANUFACTURING
INCENTIVES.—Section
32905 of title 49, United States Code, is amended
as follows:
(A) Subsections (b) and (d) are each
amended by striking ‘‘model years 1993–2004’’
and inserting ‘‘model years 1993–2008’’.
(B) Subsection (f) is amended by striking
‘‘Not later than December 31, 2001, the Sec-
retary’’ and inserting ‘‘Not later than Decem-
ber 31, 2005, the Secretary’’.
(C) Subsection (f)(1) is amended by strik-
ing ‘‘model year 2004’’ and inserting ‘‘model
year 2008’’.
(D) Subsection (g) is amended by striking
‘‘Not later than September 30, 2000’’ and in-
serting ‘‘Not later than September 30, 2004’’.
(2) MAXIMUM
FUEL
ECONOMY
INCREASE.—
Subsection (a)(1) of section 32906 of title 49,
United States Code, is amended as follows:
(A) Subparagraph (A) is amended by
striking ‘‘the model years 1993–2004’’ and in-
serting ‘‘model years 1993–2008’’.
(B) Subparagraph (B) is amended by
striking ‘‘the model years 2005–2008’’ and in-
serting ‘‘model years 2009–2012’’.
SEC. 204. FUEL ECONOMY OF THE FEDERAL FLEET OF
AUTOMOBILES.
Section 32917 of title 49, United States Code, is
amended to read as follows:
‘‘§ 32917. Standards for executive agency automobiles
‘‘(a) BASELINE AVERAGE FUEL ECONOMY.—The
head of each executive agency shall determine, for all auto-
mobiles in the agency’s fleet of automobiles that were
leased or bought as a new vehicle in fiscal year 1999, the
average fuel economy for such automobiles. For the pur-
poses of this section, the average fuel economy so deter-
mined shall be the baseline average fuel economy for the
agency’s fleet of automobiles.
‘‘(b) INCREASE OF AVERAGE FUEL ECONOMY.—The
head of an executive agency shall manage the procurement
of automobiles for that agency in such a manner that—
‘‘(1) not later than September 30, 2003, the av-
erage fuel economy of the new automobiles in the
agency’s fleet of automobiles is not less than 1 mile
per gallon higher than the baseline average fuel
economy determined under subsection (a) for that
fleet; and
‘‘(2) not later than September 30, 2005, the av-
erage fuel economy of the new automobiles in the
agency’s fleet of automobiles is not less than 3 miles
per gallon higher than the baseline average fuel
economy determined under subsection (a) for that
fleet.
‘‘(c) CALCULATION OF AVERAGE FUEL ECONOMY.—
Average fuel economy shall be calculated for the purposes
of this section in accordance with guidance which the Sec-
retary of Transportation shall prescribe for the implemen-
tation of this section.
‘‘(d) DEFINITIONS.—In this section:
‘‘(1) The term ‘automobile’ does not include
any vehicle designed for combat-related missions,
law enforcement work, or emergency rescue work.
‘‘(2) The term ‘executive agency’ has the mean-
ing given that term in section 105 of title 5.
‘‘(3) The term ‘new automobile’, with respect to
the fleet of automobiles of an executive agency,
means an automobile that is leased for at least 60
consecutive days or bought, by or for the agency,
after September 30, 1999.’’.
SEC. 205. HYBRID VEHICLES AND ALTERNATIVE VEHICLES.
(a) IN GENERAL.—Section 303(b)(1) of the Energy
Policy Act of 1992 is amended by adding the following
at the end: ‘‘Of the total number of vehicles acquired by
a Federal fleet in fiscal years 2004 and 2005, at least
5 percent of the vehicles in addition to those covered by
the preceding sentence shall be alternative fueled vehicles
or hybrid vehicles and in fiscal year 2006 and thereafter
at least 10 percent of the vehicles in addition to those cov-
ered by the preceding sentence shall be alternative fueled
vehicles or hybrid vehicles.’’.
(b) DEFINITION.—Section 301 of such Act is amend-
ed by striking ‘‘and’’ at the end of paragraph (13), by
striking the period at the end of paragraph (14) and in-
serting ‘‘; and’’ and by adding at the end the following:
‘‘(15) The term ‘hybrid vehicle’ means a motor vehi-
cle which draws propulsion energy from onboard sources
of stored energy which are both—
‘‘(A) an internal combustion or heat engine
using combustible fuel; and
‘‘(B) a rechargeable energy storage system.’’.
SEC. 206. FEDERAL FLEET PETROLEUM-BASED NONALTER-
NATIVE FUELS.
(a) IN GENERAL.—Title III of the Energy Policy Act
of 1992 (42 U.S.C. 13212 et seq.) is amended as follows:
(1) By adding at the end thereof the following:
‘‘SEC. 313. CONSERVATION OF PETROLEUM-BASED FUELS
BY THE FEDERAL GOVERNMENT FOR LIGHT-
DUTY MOTOR VEHICLES.
‘‘(a) PURPOSES.—The purposes of this section are to
complement and supplement the requirements of section
303 of this Act that Federal fleets, as that term is defined
in section 303(b)(3), acquire in the aggregate a minimum
percentage of alternative fuel vehicles, to encourage the
manufacture and sale or lease of such vehicles nationwide,
and to achieve, in the aggregate, a reduction in the
amount of the petroleum-based fuels (other than the alter-
native fuels defined in this title) used by new light-duty
motor vehicles acquired by the Federal Government in
model years 2004 through 2010 and thereafter.
‘‘(b) IMPLEMENTATION.—In furtherance of such pur-
poses, such Federal fleets in the aggregate shall reduce
the purchase of petroleum-based nonalternative fuels for
such fleets beginning October 1, 2003, through September
30, 2009, from the amount purchased for such fleets over
a comparable period since enactment of this Act, as deter-
mined by the Secretary, through the annual purchase, in
accordance with section 304, and the use of alternative
fuels for the light-duty motor vehicles of such Federal
fleets, so as to achieve levels which reflect total reliance
by such fleets on the consumptive use of alternative fuels
consistent with the provisions of section 303(b) of this
Act. The Secretary shall, within 120 days after the enact-
ment of this section, promulgate, in consultation with the
Administrator of the General Services Administration and
the Director of the Office of Management and Budget and
such other heads of entities referenced in section 303 with-
in the executive branch as such Director may designate,
standards for the full and prompt implementation of this
section by such entities. The Secretary shall monitor com-
pliance with this section and such standards by all such
fleets and shall report annually to the Congress, based on
reports by the heads of such fleets, on the extent to which
the requirements of this section and such standards are
being achieved. The report shall include information on
annual reductions achieved of petroleum-based fuels and
the problems, if any, encountered in acquiring alternative
fuels and in requiring their use.’’.
(2) By amending section 304(b) of such Act to
read as follows:
‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There
are authorized to be appropriated to the Secretary or, as
appropriate, the head of each Federal fleet subject to the
provisions of this section and section 313 of this Act, such
sums as may be necessary to achieve the purposes of sec-
tion 313(a) and the provisions of this section. Such sums
shall remain available until expended.’’.
(b) CLERICAL AMENDMENT.—The table of contents
in section 1(b) of such Act is amended by adding at the
end of the items relating to title III the following:
‘‘Sec. 313. Conservation of petroleum-based fuels by the Federal Government for
light-duty motor vehicles.’’.
SEC. 207. STUDY OF FEASIBILITY AND EFFECTS OF REDUC-
ING USE OF FUEL FOR AUTOMOBILES.
(a) IN GENERAL.—Not later than 30 days after the
date of the enactment of this Act, the Secretary of Trans-
portation shall enter into an arrangement with the Na-
tional Academy of Sciences under which the Academy
shall study the feasibility and effects of reducing by model
year 2010, by a significant percentage, the use of fuel for
automobiles.
(b) SUBJECTS OF STUDY.—The study under this sec-
tion shall include—
(1) examination of, and recommendation of al-
ternatives to, the policy under current Federal law
of establishing average fuel economy standards for
automobiles and requiring each automobile manufac-
turer to comply with average fuel economy standards
that apply to the automobiles it manufactures;
(2) examination of how automobile manufactur-
ers could contribute toward achieving the reduction
referred to in subsection (a);
(3) examination of the potential of fuel cell
technology in motor vehicles in order to determine
the extent to which such technology may contribute
to achieving the reduction referred to in subsection
(a); and
(4) examination of the effects of the reduction
referred to in subsection (a) on—
(A) gasoline supplies;
(B) the automobile industry, including
sales of automobiles manufactured in the
United States;
(C) motor vehicle safety; and
(D) air quality.
(c) REPORT.—The Secretary shall require the Na-
tional Academy of Sciences to submit to the Secretary and
the Congress a report on the findings, conclusion, and rec-
ommendations of the study under this section by not later
than 1 year after the date of the enactment of this Act.
TITLE III—NUCLEAR ENERGY
Subtitle A—General Provisions
SEC. 301. BUDGET STATUS OF NUCLEAR WASTE FUND.
(a) IN GENERAL.—Notwithstanding any other provi-
sion of law, the receipts and disbursements of the Nuclear
Waste Fund established under section 302 of the Nuclear
Waste Policy Act of 1982 (42 U.S.C. 10222) shall not
be counted as new budget authority, outlays, receipts, or
deficit or surplus for purposes of—
(1) the budget of the United States Govern-
ment as submitted by the President;
(2) the congressional budget; or
(3) the Balanced Budget and Emergency Def-
icit Control Act of 1985.
(b) EFFECT ON PAYGO SCORECARD.—Upon the en-
actment of this Act, the Director of the Office of Manage-
ment and Budget shall not make any estimates of changes
in direct spending outlays and receipts under section
252(d) of the Balanced Budget and Emergency Deficit
Control Act of 1985 resulting from the enactment of sub-
section (a) of this section.
SEC. 302. LICENSE PERIOD.
Section 103 c. of the Atomic Energy Act of 1954 (42
U.S.C. 2133(c)) is amended—
(1) by striking ‘‘c. Each such’’ and inserting
the following:
‘‘c. LICENSE PERIOD.—
‘‘(1) IN GENERAL.—Each such’’; and
(2) by adding at the end the following:
‘‘(2) COMBINED LICENSES.—In the case of a
combined construction and operating license issued
under section 185 b., the initial duration of the li-
cense may not exceed 40 years from the date on
which the Commission finds, before operation of the
facility, that the acceptance criteria required by sec-
tion 185 b. are met.’’.
SEC. 303. COST RECOVERY FROM GOVERNMENT AGENCIES.
Section 161 w. of the Atomic Energy Act of 1954
(42 U.S.C. 2201(w)) is amended—
(1) by striking ‘‘for or is issued’’ and all that
follows through ‘‘1702’’ and inserting ‘‘to the Com-
mission for, or is issued by the Commission, a li-
cense or certificate’’;
(2) by striking ‘‘483a’’ and inserting ‘‘9701’’;
and
(3) by striking ‘‘, of applicants for, or holders
of, such licenses or certificates’’.
SEC. 304. DEPLETED URANIUM HEXAFLUORIDE.
Section 1(b) of Public Law 105–204 is amended by
striking ‘‘fiscal year 2002’’ and inserting ‘‘fiscal year
2005’’.
SEC. 305. NUCLEAR REGULATORY COMMISSION MEETINGS.
If a quorum of the Nuclear Regulatory Commission
gathers to discuss official Commission business the discus-
sions shall be recorded, and the Commission shall notify
the public of such discussions within 15 days after they
occur. The Commission shall promptly make a transcript
of the recording available to the public on request, except
to the extent that public disclosure is exempted or prohib-
ited by law. This section shall not apply to a meeting,
within the meaning of that term under section 552b(a)(2)
of title 5, United States Code.
Diffusion Plant, $169,000,000 for the period encom-
passing fiscal years 2002 through 2005.
SEC. 313. RESEARCH AND DEVELOPMENT.
(a) PLAN.—Not later than 5 months after the date
of the enactment of this Act, the Secretary shall transmit
to the Congress a detailed research and development plan
with respect to advanced gas centrifuge technology for
uranium enrichment.
(b) ELEMENTS.—The plan required under subsection
(a) shall—
(1) identify the technical obstacles to the de-
ployment of an advanced gas centrifuge technology
that will be cost competitive with advanced gas cen-
trifuge technologies deployed in other nations, and
propose a strategy to overcome those obstacles;
(2) include plans for the construction of a pilot
facility at a Department of Energy-owned Gaseous
Diffusion Plant, and for full-scale deployment of ad-
vanced gas centrifuge technology, as necessary to
move gas centrifuge technology for uranium enrich-
ment from the laboratory to the marketplace, taking
into consideration—
(A) confirmation of technical performance;
and
(B) initiation of preliminary plant design
and engineering that validates economic projec-
tions and considers cost effectiveness, accessi-
bility to infrastructure, turnover activities,
schedule, financing mechanisms, and risks of
construction;
(3) provide a process to validate and dem-
onstrate commercial feasibility, if the pilot facility
described in paragraph (2) is not constructed;
(4) set forth a schedule to ensure full-scale de-
ployment, and a strategy to provide a reliable and
economical domestic source of uranium enrichment
services until such full-scale deployment is com-
pleted;
(5) evaluate the relative merits of full-scale de-
ployment by—
(A) private sector companies;
(B) a government-owned corporation;
(C) a partnership between the private and
public sectors; and
(D) the Department of Energy,
using facilities and property at the Portsmouth Gas-
eous Diffusion Plant or the Paducah Gaseous Diffu-
sion Plant; and
(6) provide for a competitive process for deploy-
ment of the full-scale technology, and assignment of
rights to use Department of Energy patents if the
Department of Energy does not deploy the tech-
nology.
(c) PUBLIC COMMENT.—Not later than 3 months
after the date of the enactment of this Act, the Secretary
shall make available a draft version of the plan for a public
comment period of 30 days.
(d) IMPLEMENTATION.—One month after the plan is
transmitted to the Congress under subsection (a), the Sec-
retary shall begin to implement the plan.
(e) FUNDING.—
(1) AUTHORIZATION OF APPROPRIATIONS.—For
the purposes of implementing the plan developed
under this section, the Secretary may use, without
need for further appropriations, the following
amounts from the United States Enrichment Cor-
poration Fund established under section 1308 of the
Atomic Energy Act of 1954 (other than amounts re-
served under Public Law 105–204):
(A) $27,000,000 for fiscal year 2002.
(B) $40,000,000 for fiscal year 2003.
(C) $58,000,000 for fiscal year 2004.
(D) $67,000,000 for fiscal year 2005.
(E) $62,000,000 for fiscal year 2006.
(2) PLAN.—The Secretary may use, without
need for further appropriations, funds from the
United States Enrichment Corporation Fund estab-
lished under section 1308 of the Atomic Energy Act
of 1954 (other than amounts reserved under Public
Law 105–204) to pay the costs of developing the
plan under this section.
SEC. 314. SHORT-TERM RELIABILITY OF DOMESTIC URA-
NIUM ENRICHMENT CAPACITY.
(a) CRITERIA.—Not later than 4 months after the
date of the enactment of this Act, the Secretary shall pre-
pare, and make available for a 30-day period of public
comment, draft criteria for determining when the hot re-
start of facilities at the Portsmouth Gaseous Diffusion
Plant may be necessary, if supplies of nuclear fuel are dis-
rupted or anticipated to be disrupted, to mitigate the im-
pacts on—
(1) the supply of nuclear fuel to power plants
in the United States; and
(2) uranium enrichment supply contracts with
foreign utilities for which the United States Govern-
ment is liable for performance in the event of non-
performance by the United States Enrichment Cor-
poration or its successors, or where the United
States has obligations under Federal law or treaty.
(b) PLAN.—Not later than 6 months after the date
of the enactment of this Act, the Secretary shall prepare,
and make available for a 30-day period of public comment,
a plan for the hot restart of facilities at the Portsmouth
Gaseous Diffusion Plant. Such plan shall—
(1) incorporate the criteria developed under
subsection (a);
(2) provide for uranium enrichment capabilities
of up to 3,000,000 separative work units per year;
(3) ensure the capability of producing both
higher assay (up to 10 percent U 235) and lower
assay (0.7 percent to 4.95 percent U 235) fuels;
(4) include options for the use of the Depart-
ment of Energy’s inventory of natural uranium;
(5) provide for the retention of sufficient R–114
refrigerant to operate the Portsmouth Gaseous Dif-
fusion Plant for 15 years or until there is equivalent
replacement uranium enrichment capacity deployed
in the United States; and
(6) include cost estimates for hot restart and
annual operating costs of the facility.
(c) TRANSMITTAL TO CONGRESS.—Not later than 8
months after the date of the enactment of this Act, the
Secretary shall transmit to the Congress the plan de-
scribed in subsection (b), including the criteria developed
under subsection (a).
(d) FUNDING.—The Secretary may use, without need
for further appropriations, funds from the United States
Enrichment Corporation Fund established under section
1308 of the Atomic Energy Act of 1954 (other than
amounts reserved under Public Law 105–204) to pay the
costs of developing the criteria and plan under this section.
SEC. 315. COOPERATIVE RESEARCH AND DEVELOPMENT
AND SPECIAL DEMONSTRATION PROJECTS
FOR THE URANIUM MINING INDUSTRY.
(a) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated to the Secretary
$10,000,000 for each of fiscal years 2002, 2003, and 2004
for—
(1) cooperative, cost-shared, agreements be-
tween the Department of Energy and domestic ura-
nium producers to identify, test, and develop im-
proved in situ leaching mining technologies, includ-
ing low-cost environmental restoration technologies
that may be applied to sites after completion of in
situ leaching operations; and
(2) funding for competitively selected dem-
onstration projects with domestic uranium producers
relating to—
(A) enhanced production with minimal en-
vironmental impacts;
(B) restoration of well fields; and
(C) decommissioning and decontamination
activities.
(b) DOMESTIC URANIUM PRODUCER.—For purposes
of this section, the term ‘‘domestic uranium producer’’ has
the meaning given that term in section 1018(4) of the En-
ergy Policy Act of 1992 (42 U.S.C. 2296b–7(4)), except
that the term shall not include any producer that has not
produced uranium from domestic reserves on or after July
30, 1998.
SEC. 316. MAINTENANCE OF A VIABLE DOMESTIC URANIUM
CONVERSION INDUSTRY.
There are authorized to be appropriated to the Sec-
retary $800,000 for contracting with the Nation’s sole re-
maining uranium converter for the purpose of performing
research and development to improve the environmental
and economic performance of United States uranium con-
version operations.
SEC. 317. PROHIBITION OF COMMERCIAL SALES OF URA-
NIUM BY THE UNITED STATES UNTIL 2009.
Section 3112 of the USEC Privatization Act (42
U.S.C. 2297h–10) is amended by adding at the end the
following new subsection:
‘‘(g) PROHIBITION ON SALES.—Notwithstanding any
other provision of law, the United States Government shall
not sell or transfer any uranium (including natural ura-
nium concentrates, natural uranium hexafluoride, en-
riched uranium, depleted uranium, or uranium in any
other form) through March 23, 2009 (except sales or
transfers for use by the Tennessee Valley Authority in re-
lation to the Department of Energy’s HEU or Tritium
programs, or the Department or Energy research reactor
sales program, or any depleted uranium hexaflouride to
be transferred to a designated Department of Energy con-
tractor in conjunction with the planned construction of the
Depleted Uranium Hexaflouride conversion plants in
Portsmouth, Ohio, and Paducah, Kentucky, or for emer-
gency purposes in the event of a disruption in supply to
end users in the United States). The aggregate of sales
or transfers of uranium by the United States Government
after March 23, 2009, shall not exceed 3,000,000 pounds
U3O8 per calendar year.’’.
SEC. 318. PADUCAH DECONTAMINATION AND DECOMMIS-
SIONING PLAN.
The Secretary of Energy shall prepare and submit
a plan to Congress within 180 days after the date of the
enactment of this Act that establishes scope, cost, sched-
ule, sequence of activities, and contracting strategy for—
(1) the decontamination and decommissioning
of the Department of Energy’s surplus buildings and
facilities at the Paducah Gaseous Diffusion Plant
that have no future anticipated reuse; and
(2) the remediation of Department of Energy
Material Storage Areas at the Paducah Gaseous Dif-
fusion Plant.
Such plan shall inventory all surplus facilities and build-
ings, and identify and rank health and safety risks associ-
ated with such facilities and buildings. Such plan shall in-
ventory all Department of Energy Material Storage Areas,
and identify and rank health and safety risks associated
with such Department of Energy Material Storage Areas.
The Department of Energy shall incorporate these risk
factors in designing the sequence and schedule for the
plan. Such plan shall identify funding requirements that
are in addition to the expected outlays included in the De-
partment of Energy’s Environmental Management Plan
for the Paducah Gaseous Diffusion Plan.
TITLE IV—HYDROELECTRIC
ENERGY
SEC. 401. ALTERNATIVE CONDITIONS AND FISHWAYS.
(a) ALTERNATIVE MANDATORY CONDITIONS.—Sec-
tion 4 of the Federal Power Act (16 U.S.C. 797) is
amended by adding at the end the following:
‘‘(h)(1) Whenever any person applies for a license for
any project works within any reservation of the United
States, and the Secretary of the department under whose
supervision such reservation falls deems a condition to
such license to be necessary under the first proviso of sub-
section (e), the license applicant or any other party to the
licensing proceeding may propose an alternative condition.
‘‘(2) Notwithstanding the first proviso of subsection
(e), the Secretary of the department under whose super-
vision the reservation falls shall accept the proposed alter-
native condition referred to in paragraph (1), and the
Commission shall include in the license such alternative
condition, if the Secretary of the appropriate department
determines, based on substantial evidence provided by the
party proposing such alternative condition, that the alter-
native condition—
‘‘(A) provides no less protection for the reserva-
tion than provided by the condition deemed nec-
essary by the Secretary; and
‘‘(B) will either—
‘‘(i) cost less to implement, or
‘‘(ii) result in improved operation of the
project works for electricity production
as compared to the condition deemed necessary by
the Secretary.
‘‘(3) Within one year after the enactment of this sub-
section, each Secretary concerned shall, by rule, establish
a process to expeditiously resolve conflicts arising under
this subsection.’’.
(b) ALTERNATIVE FISHWAYS.—Section 18 of the
Federal Power Act (16 U.S.C. 811) is amended by—
(1) inserting ‘‘(a)’’ before the first sentence;
and
(2) adding at the end the following:
‘‘(b)(1) Whenever the Commission shall require a li-
censee to construct, maintain, or operate a fishway pre-
scribed by the Secretary of the Interior or the Secretary
of Commerce under this section, the licensee or any other
party to the proceeding may propose an alternative to such
prescription to construct, maintain, or operate a fishway.
‘‘(2) Notwithstanding subsection (a), the Secretary of
the Interior or the Secretary of Commerce, as appropriate,
shall accept and prescribe, and the Commission shall re-
quire, the proposed alternative referred to in paragraph
(1), if the Secretary of the appropriate department deter-
mines, based on substantial evidence provided by the party
proposing such alternative, that the alternative—
‘‘(A) will be no less effective than the fishway
initially prescribed by the Secretary, and
‘‘(B) will either—
‘‘(i) cost less to implement, or
‘‘(ii) result in improved operation of the
project works for electricity production
as compared to the fishway initially prescribed by
the Secretary.
‘‘(3) Within one year after the enactment of this sub-
section, the Secretary of the Interior and the Secretary
of Commerce shall each, by rule, establish a process to
expeditiously resolve conflicts arising under this sub-
section.’’
SEC. 402. FERC DATA ON HYDROELECTRIC LICENSING.
(a) DATA COLLECTION PROCEDURES.—The Federal
Energy Regulatory Commission shall revise its procedures
regarding the collection of data in connection with the
Commission’s consideration of hydroelectric licenses under
the Federal Power Act. Such revised data collection proce-
dures shall be designed to provide the Commission with
complete and accurate information concerning the time
and costs to parties involved in the licensing process. Such
data shall be available for each significant stage in the
licensing process and shall be designed to identify projects
with similar characteristics so that analyses can be made
of the time and costs involved in licensing proceedings
based upon the different characteristics of those pro-
ceedings.
(b) REPORTS.—Within 6 months after the date of en-
actment of this Act, the Commission shall notify the Com-
mittee on Energy and Commerce of the United States
House of Representatives and the Committee on Energy
and Natural Resources of the United States Senate of the
progress made by the Commission under subsection (a),
and within one year after such date of enactment, the
Commission shall submit a report to such Committees
specifying the measures taken by the Commission pursu-
ant to subsection (a).
TITLE V—CLEAN COAL
SEC. 501. SHORT TITLE.
This title may be cited as the ‘‘National Electricity
and Environmental Improvement Act’’.
SEC. 502. FINDINGS.
Congress finds that—
(1) reliable, affordable, increasingly clean elec-
tricity will continue to power the growing United
States economy;
(2) an increasing use of electrotechnologies, the
desire for continuous environmental improvement, a
more competitive electricity market, and concerns
about rising energy prices add importance to the
need for reliable, affordable, increasingly clean elec-
tricity;
(3) coal, which, as of the date of enactment of
this Act, accounts for more than 1⁄2 of all electricity
generated in the United States, is the most abun-
dant fossil energy resource of the United States;
(4) coal comprises more than 85 percent of all
fossil resources in the United States and exists in
quantities sufficient to supply the United States for
250 years at current usage rates;
(5) investments in electricity generating facility
emissions control technology over the past 30 years
have reduced the aggregate emissions of pollutants
from coal-based generating facilities by 21 percent,
even as coal use for electricity generation has nearly
tripled;
(6) continuous improvement in efficiency and
environmental performance from electricity gener-
ating facilities would allow continued use of coal and
preserve less abundant energy resources for other
energy uses;
(7) new methods and equipment for converting
coal into electricity can effectively eliminate health-
threatening emissions and improve efficiency by as
much as 50 percent, but initial deployment of new
coal generation methods and equipment entails sig-
nificant risk that generators may be unable to ac-
cept in a newly competitive electricity market; and
(8) continued environmental improvement in
coal-based generation and increasing the production
and supply of power generation facilities with less
air emissions, with the ultimate goal of near-zero
emissions, is important and desirable.
Subtitle A—Accelerated Clean Coal
Power Production Program
SEC. 511. DEFINITIONS.
In this subtitle:
(1) COST
AND
PERFORMANCE
GOALS.—The
term ‘‘cost and performance goals’’ means the cost
and performance goals established under section
512.
(2) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of Energy.
SEC. 512. COST AND PERFORMANCE GOALS.
(a) IN GENERAL.—The Secretary shall perform an
assessment that establishes cost and performance goals
with respect to various coal-based electric generation fa-
cilities, power production strategies, and other efforts that
would permit the continued cost-competitive use of coal
for electricity generation, as chemical feedstocks, and as
transportation fuel in 2007, 2015, and 2020.
(b) CONSULTATION.—In establishing the cost and
performance goals, the Secretary shall consult with rep-
resentatives of—
(1) the United States coal industry;
(2) State coal development agencies;
(3) the electric utility industry;
(4) railroads and other transportation indus-
tries;
(5) manufacturers of advanced coal-based
equipment;
(6) organizations representing workers;
(7) organizations formed to—
(A) promote the use of coal;
(B) further the goals of environmental pro-
tection; and
(C) promote the production and generation
of coal-based power from advanced facilities;
and
(8) other appropriate Federal and State agen-
cies.
(c) TIMING.—The Secretary shall—
(1) not later than 120 days after the date of
enactment of this Act, issue a set of draft cost and
performance goals for public comment; and
(2) not later than 180 days after the date of
enactment of this Act, after taking into consider-
ation any public comments received, submit to Con-
gress the final cost and performance goals.
SEC. 513. STUDY.
(a) IN GENERAL.—Not later than 1 year after the
date of enactment of this Act, and once every 2 years
thereafter through 2016, the Secretary, in cooperation
with the Secretary of the Interior and the Administrator
of the Environmental Protection Agency, shall transmit to
the Congress a report containing the results of a study
to—
(1) identify methods and equipment that, by
themselves or in combination with other efforts, may
be capable of achieving the cost and performance
goals;
(2) assess the costs that would be incurred by,
and the period of time that would be required for,
the production of power generation methods and
equipment that, by themselves or in combination
with other methods and equipment, contribute to the
achievement of the cost and performance goals;
(3) develop recommendations for the Depart-
ment of Energy, in cooperation with industry, to de-
velop and implement methods and equipment that,
by themselves or in combination with other efforts,
achieve the production and generation of coal-based
power meeting the cost and performance goals; and
(4) develop recommendations for additional au-
thorities required to achieve the cost and perform-
ance goals.
(b) EXPERT ADVICE.—In carrying out this section,
the Secretary shall give due weight to the expert advice
of representatives of the entities described in section
512(b).
SEC. 514. PRODUCTION AND GENERATION OF COAL-BASED
POWER.
(a) IN GENERAL.—The Secretary shall carry out a
program to facilitate production and generation of coal-
based power through methods and equipment under—
(1) this subtitle;
(2) the Federal Nonnuclear Energy Research
and Development Act of 1974 (42 U.S.C. 5901 et
seq.);
(3) the Energy Reorganization Act of 1974 (42
U.S.C. 5801 et seq.); and
(4) title XIII of the Energy Policy Act of 1992
(42 U.S.C. 13331 et seq.).
(b) CONDITIONS.—The program described in sub-
section (a) shall be designed to achieve the cost and per-
formance goals.
SEC. 515. AUTHORIZATION OF APPROPRIATIONS.
(a) IN GENERAL.—There are authorized to be appro-
priated to the Secretary to carry out sections 512, 513,
and 514, $100,000,000 for each of the fiscal years 2002
through 2012, to remain available until expended.
(b) CONDITIONS OF AUTHORIZATION.—The author-
ization of appropriations under subsection (a)—
(1) shall be in addition to authorizations of ap-
propriations in effect on the date of enactment of
this Act; and
(2) shall not be a cap on Department of Energy
fossil energy research and development and clean
coal technology appropriations.
SEC. 516. CLEAN COAL POWER INITIATIVE.
(a) IN GENERAL.—The Secretary shall establish a
clean coal power initiative to facilitate the production and
generation of power from advanced coal-based methods
and equipment applicable to new or existing power plants,
including coproduction plants.
(b) REQUIREMENTS.—The methods and equipment
to be addressed under the initiative—
(1) shall be methods and equipment that, by
themselves or in combination with other methods
and equipment, advance efficiency and environ-
mental performance, and increase the supply of
power and promote cost competitiveness, well beyond
that which is in operation or has been demonstrated
as of the date of enactment of this Act; and
(2) may include methods and equipment that
have not previously been envisioned for the produc-
tion and generation of coal-based power.
(c) PLAN.—Not later than 120 days after the date
of enactment of this Act, the Secretary shall transmit to
Congress a plan to carry out subsection (a) that includes
a description of—
(1) the program elements and management
structure to be used;
(2) milestones to be achieved with respect to
the production and generation of coal-based power
methods and equipment; and
(3) the activities proposed to be conducted at
facilities that serve or are located at new or existing
100
coal-based electric generation units having at least
50 megawatts nameplate rating, including improve-
ments to allow the units to achieve 1 or more of the
following:
(A) An overall design efficiency improve-
ment of not less than 3 percent as compared
with the efficiency of the unit as operated as of
the date of enactment of this Act and before
any retrofit, repowering, replacement, or instal-
lation.
(B) A significant improvement in, or new
alternative method or equipment to enhance,
the environmental performance related to the
control of sulfur dioxide, nitrogen oxide, or mer-
cury in a manner that is different and well
below the cost of activities at facilities that are
in operation or have been in operation as of the
date of enactment of this Act.
(C) A means of recycling or reusing a sig-
nificant portion of coal combustion or gasifi-
cation wastes or byproducts produced by coal-
based generating units, excluding practices that
are generally available as of the date of enact-
ment of this Act.
101
(D) A means to capture, separate, and
reuse or dispose of carbon dioxide that is dif-
ferent and well below the cost of methods and
equipment that are in operation or have been in
operation as of the date of enactment of this
Act.
SEC. 517. FINANCIAL ASSISTANCE.
(a) IN GENERAL.—Not later than 180 days after the
date on which the Secretary transmits to Congress the
plan under section 516(c), the Secretary shall solicit pro-
posals for projects that serve or are located at new or ex-
isting facilities designed to achieve 1 or more of the levels
of performance set forth in section 516(c)(3).
(b) PROJECT CRITERIA.—A solicitation under sub-
section (a) may include solicitation of a proposal for a
project to demonstrate—
(1) an overall design efficiency improvement of
not less 3 percentage points as compared with the
efficiency of the unit as operated as of the date of
enactment of this Act and with no increase in the
potential to emit sulfur dioxide, nitrogen oxide, par-
ticulate matter, mercury, or carbon monoxide;
(2) a reduction of emissions to a level of not
more than—
(A)(i) in the case of sulfur dioxide—
102
(I) in the case of coal with a potential
combustion concentration sulfur emission
of 1.2 or more pounds per million British
thermal units of heat input, 5 percent of
the potential combustion concentration sul-
fur dioxide emissions; or
(II) in the case of a coal with a poten-
tial combustion concentration of less than
1.2 pounds of per million British thermal
units of heat input, 15 percent of the po-
tential combustion concentration of sulfur
dioxide emissions;
(ii) in the case of nitrogen oxide—
(I) in the case of a boiler other than
a cyclone-fired boiler, emissions of 0.1
pound per million British thermal units of
heat; or
(II) in the case of a cyclone-fired boil-
er, 15 percent of the uncontrolled nitrogen
oxide emissions from the boiler; or
(iii) in the case of particulate matter, emis-
sions of 0.02 pound per million British thermal
units of heat input; or
(B) the emission levels for the pollutants
identified in subparagraph (A) that are speci-
103
fied in the new source performance standards of
the Clean Air Act (42 U.S.C. 7411) in effect at
the time of construction, installation, or retro-
fitting of the advanced coal-based method or
equipment for the category of source if they are
lower than the levels specified in subparagraph
(A); or
(3) the production of coal combustion byprod-
ucts that are capable of obtaining economic values
significantly greater than byproducts produced as of
the date of enactment of this Act with no increase
in the potential to emit sulfur dioxide, nitrogen
oxide, particulate matter, mercury, or carbon mon-
oxide.
(c) FINANCIAL ASSISTANCE.—The Secretary shall
provide financial assistance to projects that are likely to—
(1) achieve overall cost reductions in the utiliza-
tion of coal to generate useful forms of energy;
(2) improve the competitiveness of coal among
various forms of energy in order to maintain a diver-
sity of fuel choices in the United States to meet elec-
tricity generation requirements;
(3) achieve, in a cost-effective manner, 1 or
more of the criteria described in the solicitation; and
104
(4) demonstrate methods and equipment that
are applicable to 25 percent of the electricity gener-
ating facilities that use coal as the primary feedstock
as of the date of enactment of this Act.
(d) FEDERAL SHARE.—The Federal share of the cost
of a project funded under this section shall not exceed 50
percent.
(e) FUNDING.—To carry out this section, the Sec-
retary may use any unobligated funds available to the Sec-
retary and any funds obligated to any project selected
under the clean coal technology program that become un-
obligated.
Subtitle B—Credit for Emission Re-
ductions 
and 
Efficiency 
Im-
provements in Existing Coal-
Based 
Electricity 
Generation
Facilities
SEC. 521. CREDIT FOR INVESTMENT IN QUALIFYING CLEAN
COAL TECHNOLOGY.
(a) ALLOWANCE
OF
QUALIFYING
CLEAN
COAL
TECHNOLOGY UNIT CREDIT.—Section 46 of the Internal
Revenue Code of 1986 (relating to amount of credit) is
amended by striking ‘‘and’’ at the end of paragraph (2),
by striking the period at the end of paragraph (3) and
inserting ‘‘, and’’, and by adding at the end the following:
105
‘‘(4) the qualifying clean coal technology unit
credit.’’.
(b) AMOUNT OF QUALIFYING CLEAN COAL TECH-
NOLOGY UNIT CREDIT.—Subpart E of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to rules for computing investment credit)
is amended by inserting after section 48 the following:
‘‘SEC. 48A. QUALIFYING CLEAN COAL TECHNOLOGY UNIT
CREDIT.
‘‘(a) IN GENERAL.—For purposes of section 46, the
qualifying clean coal technology unit credit for any taxable
year is an amount equal to 10 percent of the qualified
investment in a qualifying system of continuous emission
control for such taxable year.
‘‘(b) QUALIFYING SYSTEM OF CONTINUOUS EMIS-
SION CONTROL.—
‘‘(1) IN GENERAL.—For purposes of subsection
(a), the term ‘qualifying system of continuous emis-
sion control’ means a system of the taxpayer
which—
‘‘(A) serves, is added to, or retrofits an ex-
isting coal-based electricity generation unit, the
construction, installation, or retrofitting of
which is completed by the taxpayer (but only
with respect to that portion of the basis which
106
is properly attributable to such construction, in-
stallation, or retrofitting),
‘‘(B) reduces the discharge into the atmos-
phere of 1 or more of the following pollutants
to not more than—
‘‘(i) 5 percent of the potential com-
bustion concentration sulfur dioxide emis-
sions for a coal with a potential combus-
tion concentration sulfur emission of 1.2
lb/million Btu of heat input or greater,
‘‘(ii) 15 percent of the potential com-
bustion concentration sulfur dioxide emis-
sions for a coal with a potential combus-
tion concentration sulfur emission of less
than 1.2 lb/million Btu of heat input,
‘‘(iii) nitrogen oxide emissions of 0.l lb
per million Btu of heat input from other
than cyclone-fired boilers,
‘‘(iv) 15 percent of the uncontrolled
nitrogen oxide emissions from cyclone-fired
boilers,
‘‘(v) particulate emission of 0.02 lb
per million Btu of heat input, and
‘‘(vi) the emission levels specified in
the new source performance standards of
107
the Clean Air Act (42 U.S.C. 7411) in
force at the time of construction, installa-
tion or retrofitting of the qualifying system
of continuous emission control for the cat-
egory of source if such level is lower than
the levels specified in clause (i), (ii), (iii),
(iv), or (v),
‘‘(C) is depreciable under section 167,
‘‘(D) has a useful life of not less than 4
years, and
‘‘(E) is located in the United States.
‘‘(2) SPECIAL RULE FOR SALE-LEASEBACKS.—
For purposes of subparagraph (A) of paragraph (1),
in the case of a unit which—
‘‘(A) is originally placed in service by a
person, and
‘‘(B) is sold and leased back by such per-
son, or is leased to such person, within 3
months after the date such unit was originally
placed in service, for a period of not less than
12 years,
such unit shall be treated as originally placed in
service not earlier than the date on which such prop-
erty is used under the leaseback (or lease) referred
to in subparagraph (B). The preceding sentence
108
shall not apply to any property if the lessee and les-
sor of such property make an election under this
sentence. Such an election, once made, may be re-
voked only with the consent of the Secretary.
‘‘(c) EXISTING COAL-BASED ELECTRICITY GENERA-
TION UNIT.—For purposes of subsection (a), the term ‘ex-
isting coal-based electricity generating unit’ means, with
respect to any taxable year, a steam generator-turbine
unit which uses coal to produce 75 percent or more of
its output as electricity and was operated commercially be-
fore the effective date of this section.
‘‘(d) LIMIT ON QUALIFYING CLEAN COAL TECH-
NOLOGY UNIT CREDIT.—For purposes of subsection (a),
the credit shall be applicable to not more than the first
$100,000,000 of qualifying investment in a qualifying sys-
tem of continuous emission control at any 1 existing coal-
based electricity generating unit.
‘‘(e) QUALIFIED INVESTMENT.—For purposes of sub-
section (a), the term ‘qualified investment’ means, with
respect to any taxable year, the basis of a qualifying sys-
tem of continuous emission control placed in service by
the taxpayer during such taxable year.
‘‘(f) QUALIFIED PROGRESS EXPENDITURES.—
‘‘(1) INCREASE IN QUALIFIED INVESTMENT.—
In the case of a taxpayer who has made an election
109
under paragraph (5), the amount of the qualified in-
vestment of such taxpayer for the taxable year (de-
termined under subsection (e) without regard to this
subsection) shall be increased by an amount equal to
the aggregate of each qualified progress expenditure
for the taxable year with respect to progress expend-
iture property.
‘‘(2) PROGRESS EXPENDITURE PROPERTY DE-
FINED.—For purposes of this subsection, the term
‘progress expenditure property’ means any property
being constructed by or for the taxpayer and which
it is reasonable to believe will qualify as a qualifying
system of continuous emission control which is being
constructed by or for the taxpayer when it is placed
in service.
‘‘(3) QUALIFIED PROGRESS EXPENDITURES DE-
FINED.—For purposes of this subsection—
‘‘(A) SELF-CONSTRUCTED PROPERTY.—In
the case of any self-constructed property, the
term ‘qualified progress expenditures’ means
the amount which, for purposes of this subpart,
is properly chargeable (during such taxable
year) to capital account with respect to such
property.
110
‘‘(B) 
NONSELF-CONSTRUCTED
PROP-
ERTY.—In the case of nonself-constructed prop-
erty, the term ‘qualified progress expenditures’
means the amount paid during the taxable year
to another person for the construction of such
property.
‘‘(4) OTHER
DEFINITIONS.—For purposes of
this subsection—
‘‘(A) SELF-CONSTRUCTED
PROPERTY.—
The term ‘self-constructed property’ means
property for which it is reasonable to believe
that more than half of the construction expendi-
tures will be made directly by the taxpayer.
‘‘(B) 
NONSELF-CONSTRUCTED
PROP-
ERTY.—The term ‘nonself-constructed property’
means property which is not self-constructed
property.
‘‘(C) CONSTRUCTION, 
ETC.—The term
‘construction’ includes reconstruction and erec-
tion, and the term ‘constructed’ includes recon-
structed and erected.
‘‘(D) ONLY
CONSTRUCTION
OF
QUALI-
FYING SYSTEM OF CONTINUOUS EMISSION CON-
TROL TO BE TAKEN INTO ACCOUNT.—Construc-
tion shall be taken into account only if, for pur-
111
poses of this subpart, expenditures therefor are
properly chargeable to capital account with re-
spect to the property.
‘‘(5) ELECTION.—An election under this sub-
section may be made at such time and in such man-
ner as the Secretary may by regulations prescribe.
Such an election shall apply to the taxable year for
which made and to all subsequent taxable years.
Such an election, once made, may not be revoked ex-
cept with the consent of the Secretary.
‘‘(g) COORDINATION WITH OTHER CREDITS.—This
section shall not apply to any property with respect to
which the rehabilitation credit under section 47 or the en-
ergy credit under section 48 is allowed unless the taxpayer
elects to waive the application of such credit to such prop-
erty.
‘‘(h) TERMINATION.—This section shall not apply
with respect to any qualified investment made more than
10 years after the effective date of this section.’’.
(c) RECAPTURE.—Section 50(a) of the Internal Rev-
enue Code of 1986 (relating to other special rules) is
amended by adding at the end the following:
‘‘(6) SPECIAL RULES RELATING TO QUALIFYING
SYSTEM OF CONTINUOUS EMISSION CONTROL.—For
purposes of applying this subsection in the case of
112
any credit allowable by reason of section 48A, the
following shall apply:
‘‘(A) GENERAL
RULE.—In lieu of the
amount of the increase in tax under paragraph
(1), the increase in tax shall be an amount
equal to the investment tax credit allowed under
section 38 for all prior taxable years with re-
spect to a qualifying system of continuous emis-
sion control (as defined by section 48A(b)(1))
multiplied by a fraction whose numerator is the
number of years remaining to fully depreciate
under this title the qualifying system of contin-
uous emission control disposed of, and whose
denominator is the total number of years over
which such unit would otherwise have been sub-
ject to depreciation. For purposes of the pre-
ceding sentence, the year of disposition of the
qualifying system of continuous emission con-
trol property shall be treated as a year of re-
maining depreciation.
‘‘(B) PROPERTY CEASES TO QUALIFY FOR
PROGRESS
EXPENDITURES.—Rules similar to
the rules of paragraph (2) shall apply in the
case of qualified progress expenditures for a
qualifying system of continuous emission con-
113
trol under section 48A, except that the amount
of the increase in tax under subparagraph (A)
of this paragraph shall be substituted in lieu of
the amount described in such paragraph (2).
‘‘(C) APPLICATION OF PARAGRAPH.—This
paragraph shall be applied separately with re-
spect to the credit allowed under section 38 re-
garding a qualifying system of continuous emis-
sion control.’’.
(d) TRANSITIONAL RULE.—Section 39(d) of the In-
ternal Revenue Code of 1986 (relating to transitional
rules) is amended by adding at the end the following:
‘‘(11) NO CARRYBACK OF SECTION 48A CREDIT
BEFORE EFFECTIVE DATE.—No portion of the un-
used business credit for any taxable year which is
attributable to the qualifying clean coal technology
unit credit determined under section 48A may be
carried back to a taxable year ending before the date
of enactment of section 48A.’’.
(e) TECHNICAL AMENDMENTS.—
(1) Section 49(a)(1)(C) of the Internal Revenue
Code of 1986 is amended by striking ‘‘and’’ at the
end of clause (ii), by striking the period at the end
of clause (iii) and inserting ‘‘, and’’, and by adding
at the end the following:
114
‘‘(iv) the portion of the basis of any
qualifying system of continuous emission
control attributable to any qualified invest-
ment (as defined by section 48A(e)).’’.
(2) Section 50(a)(4) of such Code is amended
by striking ‘‘and (2)’’ and inserting ‘‘, (2), and (6)’’.
(3) Section 50(c) of such Code is amended by
adding at the end the following:
‘‘(6) NONAPPLICATION.—Paragraphs (1) and
(2) shall not apply to any qualifying clean coal tech-
nology unit credit under section 48A.’’.
(4) The table of sections for subpart E of part
IV of subchapter A of chapter 1 of such Code is
amended by inserting after the item relating to sec-
tion 48 the following:
‘‘Sec. 48A. Qualifying clean coal technology unit credit.’’.
(f) EFFECTIVE DATE.—The amendments made by
this section shall apply to periods after December 31,
2001, under rules similar to the rules of section 48(m)
of the Internal Revenue Code of 1986 (as in effect on the
day before the date of enactment of the Revenue Reconcili-
ation Act of 1990).
SEC. 522. CREDIT FOR PRODUCTION FROM A QUALIFYING
CLEAN COAL TECHNOLOGY UNIT.
(a) CREDIT FOR PRODUCTION FROM A QUALIFYING
CLEAN COAL TECHNOLOGY UNIT.—Subpart D of part IV
115
of subchapter A of chapter 1 of the Internal Revenue Code
of 1986 (relating to business related credits) is amended
by adding at the end the following:
‘‘SEC. 45G. CREDIT FOR PRODUCTION FROM A QUALIFYING
CLEAN COAL TECHNOLOGY UNIT.
‘‘(a) GENERAL RULE.—For purposes of section 38,
the qualifying clean coal technology production credit of
any taxpayer for any taxable year is equal to the product
of—
‘‘(1) the applicable amount of clean coal tech-
nology production credit, multiplied by
‘‘(2) the kilowatt hours of electricity produced
by the taxpayer during such taxable year at a quali-
fying clean coal technology unit during the 10-year
period beginning on the date the unit was returned
to service after retrofit, repowering, or replacement.
‘‘(b) APPLICABLE AMOUNT.—
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, the applicable amount of clean coal technology
production credit is equal to $0.0034.
‘‘(2) INFLATION
ADJUSTMENT
FACTOR.—For
calendar years after 2001, the applicable amount of
clean coal technology production credit shall be ad-
justed by multiplying such amount by the inflation
adjustment factor for the calendar year in which the
116
amount is applied. If any amount as increased under
the preceding sentence is not a multiple of 0.01 cent,
such amount shall be rounded to the nearest mul-
tiple of 0.01 cent.
‘‘(c) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section—
‘‘(1) QUALIFYING
CLEAN
COAL
TECHNOLOGY
UNIT.—The term ‘qualifying clean coal technology
unit’ means a unit of the taxpayer which—
‘‘(A) is an existing coal-based electricity
generating steam generator-turbine unit,
‘‘(B) has a nameplate capacity rating of
not more than 300,000 kilowatts, and
‘‘(C) has been retrofitted, repowered, or re-
placed with a clean coal technology within 10
years after the effective date of this section.
‘‘(2) CLEAN
COAL
TECHNOLOGY.—The term
‘clean coal technology’ means technology which—
‘‘(A) uses coal to produce 50 percent or
more of its thermal output as electricity, includ-
ing advanced pulverized coal or atmospheric flu-
idized bed combustion, pressurized fluidized bed
combustion, integrated gasification combined
cycle, or any other technology for the produc-
tion of electricity,
117
‘‘(B) has a design heat rate not less than
500 Btu/kWh below that of the existing unit be-
fore it is retrofit, repowered, or replaced with
the qualifying clean coal technology,
‘‘(C) has a maximum design heat rate of
not more than 9,500 Btu/kWh when the design
coal has a heat content of more than 9,000 Btu
per pound,
‘‘(D) has a maximum design heat rate of
not more than 10,500 Btu/kWh when the de-
sign coal has a heat content of 9,000 Btu per
pound or less, and
‘‘(E) reduces the discharge into the atmos-
phere of 1 or more of the following pollutants
to not more than—
‘‘(i) 5 percent of the potential com-
bustion concentration sulfur dioxide emis-
sions for a coal with a potential combus-
tion concentration sulfur emission of 1.2
lb/million Btu of heat input or greater,
‘‘(ii) 15 percent of the potential com-
bustion concentration sulfur dioxide emis-
sions for a coal with a potential combus-
tion concentration sulfur emission of less
than 1.2 lb/million Btu of heat input,
118
‘‘(iii) nitrogen oxide emissions of 0.1
lb per million Btu of heat input from other
than cyclone-fired boilers,
‘‘(iv) 15 percent of the uncontrolled
nitrogen oxide emissions from cyclone-fired
boilers,
‘‘(v) particulate emissions of 0.02 lb
per million Btu of heat input, and
‘‘(vi) the emission levels specified in
the new source performance standards of
the Clean Air Act (42 U.S.C. 7411) in ef-
fect at the time of construction, installa-
tion or retrofitting of the qualifying clean
coal technology unit for the category of
source if such level is lower than the levels
specified in clause (i), (ii), (iii), (iv), or (v).
‘‘(3) APPLICATION OF CERTAIN RULES.—The
rules of paragraphs (3), (4), and (5) of section 45
shall apply.
‘‘(4) INFLATION
ADJUSTMENT
FACTOR.—The
term ‘inflation adjustment factor’ means, with re-
spect to a calendar year, a fraction the numerator
of which is the GDP implicit price deflator for the
preceding calendar year and the denominator of
119
which is the GDP implicit price deflator for the cal-
endar year 2001.
‘‘(5) GDP IMPLICIT
PRICE
DEFLATOR.—The
term ‘GDP implicit price deflator’ means the most
recent revision of the implicit price deflator for the
gross domestic product as computed by the Depart-
ment of Commerce before March 15 of the calendar
year.
‘‘(d) COORDINATION WITH OTHER CREDITS.—This
section shall not apply to any property with respect to
which the qualifying clean coal technology unit credit
under section 48A is allowed unless the taxpayer elects
to waive the application of such credit to such property.’’.
(b) CREDIT TREATED AS BUSINESS CREDIT.—Sec-
tion 38(b) of the Internal Revenue Code of 1986 is amend-
ed by striking ‘‘plus’’ at the end of paragraph (14), by
striking the period at the end of paragraph (15) and in-
serting ‘‘, plus’’, and by adding at the end the following:
‘‘(16) the qualifying clean coal technology pro-
duction credit determined under section 45G(a).’’.
(c) TRANSITIONAL RULE.—Section 39(d) of the In-
ternal Revenue Code of 1986 (relating to transitional
rules), as amended by section 201(d), is amended by add-
ing at the end the following:
120
‘‘(12) NO CARRYBACK OF SECTION 45G CREDIT
BEFORE EFFECTIVE DATE.—No portion of the un-
used business credit for any taxable year which is
attributable to the qualifying clean coal technology
production credit determined under section 45G may
be carried back to a taxable year ending before the
date of enactment of section 45G.’’.
(d) CLERICAL AMENDMENT.—The table of sections
for subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended by add-
ing at the end the following:
‘‘Sec. 45G. Credit for production from a qualifying clean coal
technology unit.’’.
(e) EFFECTIVE DATE.—The amendments made by
this section shall apply to production after the date of en-
actment of this Act.
Subtitle C—Incentives for Early
Commercial Applications of Ad-
vanced Clean Coal Technologies
SEC. 531. CREDIT FOR INVESTMENT IN QUALIFYING AD-
VANCED CLEAN COAL TECHNOLOGY.
(a) ALLOWANCE OF QUALIFYING ADVANCED CLEAN
COAL TECHNOLOGY FACILITY CREDIT.—Section 46 of
the Internal Revenue Code of 1986 (relating to amount
of credit), as amended by section 201(a), is amended by
striking ‘‘and’’ at the end of paragraph (3), by striking
121
the period at the end of paragraph (4) and inserting ‘‘,
and’’, and by adding at the end the following:
‘‘(5) the qualifying advanced clean coal tech-
nology facility credit.’’.
(b) AMOUNT
OF QUALIFYING ADVANCED CLEAN
COAL TECHNOLOGY FACILITY CREDIT.—Subpart E of
part IV of subchapter A of chapter 1 of the Internal Rev-
enue Code of 1986 (relating to rules for computing invest-
ment credit), as amended by section 521(b), is amended
by inserting after section 48A the following:
‘‘SEC. 48B. QUALIFYING ADVANCED CLEAN COAL TECH-
NOLOGY FACILITY CREDIT.
‘‘(a) IN GENERAL.—For purposes of section 46, the
qualifying advanced clean coal technology facility credit
for any taxable year is an amount equal to 10 percent
of the qualified investment in a qualifying advanced clean
coal technology facility for such taxable year.
‘‘(b) QUALIFYING ADVANCED CLEAN COAL TECH-
NOLOGY FACILITY.—
‘‘(1) IN GENERAL.—For purposes of subsection
(a), the term ‘qualifying advanced clean coal tech-
nology facility’ means a facility of the taxpayer
which—
‘‘(A)(i)(I) original use of which commences
with the taxpayer, or
122
‘‘(II) is a retrofitted or repowered conven-
tional technology facility, the retrofitting or
repowering of which is completed by the tax-
payer (but only with respect to that portion of
the basis which is properly attributable to such
retrofitting or repowering), or
‘‘(ii) is acquired through purchase (as de-
fined by section 179(d)(2)),
‘‘(B) is depreciable under section 167,
‘‘(C) has a useful life of not less than 4
years,
‘‘(D) is located in the United States, and
‘‘(E) uses qualifying advanced clean coal
technology.
‘‘(2) SPECIAL RULE FOR SALE-LEASEBACKS.—
For purposes of subparagraph (A) of paragraph (1),
in the case of a facility which—
‘‘(A) is originally placed in service by a
person, and
‘‘(B) is sold and leased back by such per-
son, or is leased to such person, within 3
months after the date such facility was origi-
nally placed in service, for a period of not less
than 12 years,
123
such facility shall be treated as originally placed in
service not earlier than the date on which such prop-
erty is used under the leaseback (or lease) referred
to in subparagraph (B). The preceding sentence
shall not apply to any property if the lessee and les-
sor of such property make an election under this
sentence. Such an election, once made, may be re-
voked only with the consent of the Secretary.
‘‘(c) QUALIFYING ADVANCED CLEAN COAL TECH-
NOLOGY.—For purposes of paragraph (1)—
‘‘(1) IN GENERAL.—The term ‘qualifying ad-
vanced clean coal technology’ means, with respect to
clean coal technology—
‘‘(A) which has—
‘‘(i) multiple applications, with a com-
bined capacity of not more than 5,000
megawatts (4,000 megawatts before 2009),
of advanced pulverized coal or atmospheric
fluidized bed combustion technology—
‘‘(I) installed as a new, retrofit,
or repowering application,
‘‘(II) operated between 2000 and
2012, and
‘‘(III) having a design net heat
rate of not more than 9,500 Btu per
124
kilowatt hour when the design coal
has a heat content of more than 9,000
Btu per pound, or a design net heat
rate of not more than 9,900 Btu per
kilowatt hour when the design coal
has a heat content of 9,000 Btu per
pound or less,
‘‘(ii) multiple applications, with a
combined capacity of not more than 1,000
megawatts (500 megawatts before 2009
and 750 megawatts before 2013), of pres-
surized 
fluidized 
bed 
combustion
technology—
‘‘(I) installed as a new, retrofit,
or repowering application,
‘‘(II) operated between 2000 and
2016, and
‘‘(III) having a design net heat
rate of not more than 8,400 Btu per
kilowatt hour when the design coal
has a heat content of more than 9,000
Btu per pound, or a design net heat
rate of not more than 9,900 Btu’s per
kilowatt hour when the design coal
125
has a heat content of 9,000 Btu per
pound or less, and
‘‘(iii) multiple applications, with a
combined capacity of not more than 2,000
megawatts (1,000 megawatts before 2009
and 1,500 megawatts before 2013), of in-
tegrated gasification combined cycle tech-
nology, with or without fuel or chemical co-
production—
‘‘(I) installed as a new, retrofit,
or repowering application,
‘‘(II) operated between 2000 and
2016,
‘‘(III) having a design net heat
rate of not more than 8,550 Btu per
kilowatt hour when the design coal
has a heat content of more than 9,000
Btu per pound, or a design net heat
rate of not more than 9,900 Btu per
kilowatt hour when the design coal
has a heat content of 9,000 Btu per
pound or less, and
‘‘(IV) having a net thermal effi-
ciency on any fuel or chemical co-pro-
126
duction of not less than 39 percent
(higher heating value), or
‘‘(iv) multiple applications, with a
combined capacity of not more than 2,000
megawatts (1,000 megawatts before 2009
and 1,500 megawatts before 2013) of tech-
nology for the production of electricity—
‘‘(I) installed as a new, retrofit,
or repowering application,
‘‘(II) operated between 2000 and
2016, and
‘‘(III) having a carbon emission
rate which is not more than 85 per-
cent of conventional technology, and
‘‘(B) which reduces the discharge into the
atmosphere of 1 or more of the following pollut-
ants to not more than—
‘‘(i) 5 percent of the potential com-
bustion concentration sulfur dioxide emis-
sions for a coal with a potential combus-
tion concentration sulfur emission of 1.2
lb/million Btu of heat input or greater,
‘‘(ii) 15 percent of the potential com-
bustion concentration sulfur dioxide emis-
sions for a coal with a potential combus-
127
tion concentration sulfur emission of less
than 1.2 lb/million Btu of heat input,
‘‘(iii) nitrogen oxide emissions of 0.1
lb per million Btu of heat input from other
than cyclone-fired boilers,
‘‘(iv) 15 percent of the uncontrolled
nitrogen oxide emissions from cyclone-fired
boilers,
‘‘(v) particulate emissions of 0.02 lb
per million Btu of heat input, and
‘‘(vi) the emission levels specified in
the new source performance standards of
the Clean Air Act (42 U.S.C. 7411) in ef-
fect at the time of retrofitting, repowering,
or replacement of the qualifying clean coal
technology unit for the category of source
if such level is lower than the levels speci-
fied in clause (i), (ii), (iii), (iv), or (v).
‘‘(2) EXCEPTIONS.—Such term shall not in-
clude any projects receiving or scheduled to receive
funding under the Clean Coal Technology Program,
or the Power Plant Improvement administered by
the Secretary of the Department of Energy or a
Qualifying Clean Coal Technology Unit as defined in
section 45G(c)(1).
128
‘‘(d) CLEAN COAL TECHNOLOGY.—The term ‘clean
coal technology’ means advanced technology which uses
coal to produce 75 percent or more of its thermal output
as electricity including advanced pulverized coal or atmos-
pheric fluidized bed combustion, pressurized fluidized bed
combustion, integrated gasification combined cycle with or
without fuel or chemical co-production, and any other
technology for the production of electricity which exceeds
the performance of conventional technology.
‘‘(e) CONVENTIONAL TECHNOLOGY.—The term ‘con-
ventional technology’ means—
‘‘(1) coal-fired combustion technology with a de-
sign net heat rate of not less than 9,500 Btu per kil-
owatt hour (HHV) and a carbon equivalents emis-
sion rate of not more than 0.54 pounds of carbon
per kilowatt hour when the design coal has a heat
content of more than 9,000 Btu per pound,
‘‘(2) coal-fired combustion technology with a de-
sign net heat rate of not less than 10,500 Btu per
kilowatt hour (HHV) and a carbon equivalents emis-
sion rate of not more than 0.60 pounds of carbon
per kilowatt hour when the design coal has a heat
content of 9,000 Btu per pound or less, or
‘‘(3) natural gas-fired combustion technology
with a design net heat rate of not less than 7,500
129
Btu per kilowatt hour (HHV) and a carbon equiva-
lents emission rate of not more than 0.24 pounds of
carbon per kilowatt hour.
‘‘(f) DESIGN NET HEAT RATE.—The design net heat
rate shall be based on the design annual heat input to
and the design annual net electrical output from the quali-
fying advanced clean coal technology (determined without
regard to such technology’s co-generation of steam).
‘‘(g) SELECTION CRITERIA.—Selection criteria for
qualifying advanced clean coal technology facilities—
‘‘(1) shall be established by the Secretary of
Energy as part of a competitive solicitation,
‘‘(2) shall include primary criteria of minimum
design net heat rate, maximum design thermal effi-
ciency, environmental performance, and lowest cost
to the government, and
‘‘(3) shall include supplemental criteria as de-
termined appropriate by the Secretary of Energy.
‘‘(h) QUALIFIED INVESTMENT.—For purposes of
subsection (a), the term ‘qualified investment’ means, with
respect to any taxable year, the basis of a qualifying ad-
vanced clean coal technology facility placed in service by
the taxpayer during such taxable year.
‘‘(i) QUALIFIED PROGRESS EXPENDITURES.—
130
‘‘(1) INCREASE IN QUALIFIED INVESTMENT.—
In the case of a taxpayer who has made an election
under paragraph (5), the amount of the qualified in-
vestment of such taxpayer for the taxable year (de-
termined under subsection (c) without regard to this
section) shall be increased by an amount equal to
the aggregate of each qualified progress expenditure
for the taxable year with respect to progress expend-
iture property.
‘‘(2) PROGRESS EXPENDITURE PROPERTY DE-
FINED.—For purposes of this subsection, the term
‘progress expenditure property’ means any property
being constructed by or for the taxpayer and which
it is reasonable to believe will qualify as a qualifying
advanced clean coal technology facility which is
being constructed by or for the taxpayer when it is
placed in service.
‘‘(3) QUALIFIED PROGRESS EXPENDITURES DE-
FINED.—For purposes of this subsection—
‘‘(A) SELF-CONSTRUCTED PROPERTY.—In
the case of any self-constructed property, the
term ‘qualified progress expenditures’ means
the amount which, for purposes of this subpart,
is properly chargeable (during such taxable
131
year) to capital account with respect to such
property.
‘‘(B) 
NONSELF-CONSTRUCTED
PROP-
ERTY.—In the case of nonself-constructed prop-
erty, the term ‘qualified progress expenditures’
means the amount paid during the taxable year
to another person for the construction of such
property.
‘‘(4) OTHER
DEFINITIONS.—For purposes of
this subsection—
‘‘(A) SELF-CONSTRUCTED
PROPERTY.—
The term ‘self-constructed property’ means
property for which it is reasonable to believe
that more than half of the construction expendi-
tures will be made directly by the taxpayer.
‘‘(B) 
NONSELF-CONSTRUCTED
PROP-
ERTY.—The term ‘nonself-constructed property’
means property which is not self-constructed
property.
‘‘(C) CONSTRUCTION, 
ETC..—The term
‘construction’ includes reconstruction and erec-
tion, and the term ‘constructed’ includes recon-
structed and erected.
‘‘(D) ONLY
CONSTRUCTION
OF
QUALI-
FYING
ADVANCED
CLEAN
COAL
TECHNOLOGY
132
FACILITY TO BE TAKEN INTO ACCOUNT.—Con-
struction shall be taken into account only if, for
purposes of this subpart, expenditures therefor
are properly chargeable to capital account with
respect to the property.
‘‘(5) ELECTION.—An election under this sub-
section may be made at such time and in such man-
ner as the Secretary may by regulations prescribe.
Such an election shall apply to the taxable year for
which made and to all subsequent taxable years.
Such an election, once made, may not be revoked ex-
cept with the consent of the Secretary.
‘‘(j) COORDINATION WITH OTHER CREDITS.—This
section shall not apply to any property with respect to
which the rehabilitation credit under section 47 or the en-
ergy credit under section 48 is allowed unless the taxpayer
elects to waive the application of such credit to such prop-
erty.
‘‘(k) TERMINATION.—This section shall not apply
with respect to any qualified investment made more than
10 years after the effective date of this section.’’.
(c) RECAPTURE.—Section 50(a) of the Internal Rev-
enue Code of 1986 (relating to other special rules), as
amended by section 201(c), is amended by adding at the
end the following:
133
‘‘(7) SPECIAL RULES RELATING TO QUALIFYING
ADVANCED CLEAN COAL TECHNOLOGY FACILITY.—
For purposes of applying this subsection in the case
of any credit allowable by reason of section 48B, the
following shall apply:
‘‘(A) GENERAL
RULE.—In lieu of the
amount of the increase in tax under paragraph
(1), the increase in tax shall be an amount
equal to the investment tax credit allowed under
section 38 for all prior taxable years with re-
spect to a qualifying advanced clean coal tech-
nology facility (as defined by section 48B(b)(1))
multiplied by a fraction whose numerator is the
number of years remaining to fully depreciate
under this title the qualifying advanced clean
coal technology facility disposed of, and whose
denominator is the total number of years over
which such facility would otherwise have been
subject to depreciation. For purposes of the
preceding sentence, the year of disposition of
the qualifying advanced clean coal technology
facility property shall be treated as a year of re-
maining depreciation.
‘‘(B) PROPERTY CEASES TO QUALIFY FOR
PROGRESS
EXPENDITURES.—Rules similar to
134
the rules of paragraph (2) shall apply in the
case of qualified progress expenditures for a
qualifying advanced clean coal technology facil-
ity under section 48B, except that the amount
of the increase in tax under subparagraph (A)
of this paragraph shall be substituted in lieu of
the amount described in such paragraph (2).
‘‘(C) APPLICATION OF PARAGRAPH.—This
paragraph shall be applied separately with re-
spect to the credit allowed under section 38 re-
garding a qualifying advanced clean coal tech-
nology facility.’’.
(d) TRANSITIONAL RULE.—Section 39(d) of the In-
ternal Revenue Code of 1986 (relating to transitional
rules), as amended by section 202(c), is amended by add-
ing at the end the following:
‘‘(13) NO CARRYBACK OF SECTION 48B CREDIT
BEFORE EFFECTIVE DATE.—No portion of the un-
used business credit for any taxable year which is
attributable to the qualifying advanced clean coal
technology facility credit determined under section
48B may be carried back to a taxable year ending
before the date of enactment of section 48B.’’.
(e) TECHNICAL AMENDMENTS.—
135
(1) Section 49(a)(1)(C) of the Internal Revenue
Code of 1986, as amended by section 521(e)(1), is
amended by striking ‘‘and’’ at the end of clause (iii),
by striking the period at the end of clause (iv) and
inserting ‘‘, and’’, and by adding at the end the fol-
lowing:
‘‘(v) the portion of the basis of any
qualifying advanced clean coal technology
facility attributable to any qualified invest-
ment (as defined by section 48B(c)).’’.
(2) Section 50(a)(4) of such Code, is amended
by striking ‘‘and (6)’’ and inserting ‘‘(6), and (7)’’.
(3) Section 50(c)(6) of such Code, is amended
by inserting ‘‘or any advanced clean coal technology
facility credit under section 48B’’ after ‘‘section
48A’’.
(4) The table of sections for subpart E of part
IV of subchapter A of chapter 1 of such Code, is
amended by inserting after the item relating to sec-
tion 48A the following:
‘‘Sec. 48B. Qualifying advanced clean coal technology facility
credit.’’.
(f) EFFECTIVE DATE.—The amendments made by
this section shall apply to periods after December 31,
2001, under rules similar to the rules of section 48(m)
of the Internal Revenue Code of 1986 (as in effect on the
136
day before the date of enactment of the Revenue Reconcili-
ation Act of 1990).
SEC. 532. CREDIT FOR PRODUCTION FROM QUALIFYING
ADVANCED CLEAN COAL TECHNOLOGY.
(a) CREDIT FOR PRODUCTION FROM QUALIFYING
ADVANCED CLEAN COAL TECHNOLOGY.—Subpart D of
part IV of subchapter A of chapter 1 of the Internal Rev-
enue Code of 1986 (relating to business related credits),
as amended by section 522(a), is amended by adding at
the end the following:
‘‘SEC. 45H. CREDIT FOR PRODUCTION FROM QUALIFYING
ADVANCED CLEAN COAL TECHNOLOGY.
‘‘(a) GENERAL RULE.—For purposes of section 38,
the qualifying advanced clean coal technology production
credit of any taxpayer for any taxable year is equal to—
‘‘(1) the applicable amount of advanced clean
coal technology production credit, multiplied by
‘‘(2) the sum of—
‘‘(A) the kilowatt hours of electricity, plus
‘‘(B) each 3,413 Btu of fuels or chemicals,
produced by the taxpayer during such taxable year
at a qualifying advanced clean coal technology facil-
ity during the 10-year period beginning on the date
the facility was originally placed in service.
137
‘‘(b) APPLICABLE AMOUNT.—For purposes of this
section, the applicable amount of advanced clean coal tech-
nology production credit with respect to production from
a qualifying advanced clean coal technology facility shall
be determined as follows:
‘‘(1) Where the design coal has a heat content
of more than 9,000 Btu per pound:
‘‘(A) In the case of a facility originally
placed in service before 2009, if—
‘‘The facility design net heat rate, Btu/kWh (HHV) is
equal to:
The applicable amount is:
For 1st 5 years
of such service
For 2d 5 years of
such service
Not more than 8,400 ............................................................
$.0060
$.0038
More than 8,400 but not more than 8,550 ..........................
$.0025
$.0010
More than 8,550 but not more than 8,750 ..........................
$.0010
$.0010.
‘‘(B) In the case of a facility originally
placed in service after 2008 and before 2013,
if—
‘‘The facility design net heat rate, Btu/kWh (HHV) is
equal to:
The applicable amount is:
For 1st 5 years
of such service
For 2d 5 years of
such service
Not more than 7,770 ............................................................
$.0105
$.0090
More than 7,770 but not more than 8,125 ..........................
$.0085
$.0068
More than 8,125 but not more than 8,350 ..........................
$.0075
$.0055.
‘‘(C) In the case of a facility originally
placed in service after 2012 and before 2017,
if—
‘‘The facility design net heat rate, Btu/kWh (HHV) is
equal to:
The applicable amount is:
For 1st 5 years
of such service
For 2d 5 years of
such service
Not more than 7,380 ............................................................
$.0140
$.01
More than 7,380 but not more than 7,720 ..........................
$.0120
$.0090.
138
‘‘(2) Where the design coal has a heat content
of not more than 9,000 Btu per pound:
‘‘(A) In the case of a facility originally
placed in service before 2009, if—
‘‘The facility design net heat rate, Btu/kWh (HHV) is
equal to:
The applicable amount is:
For 1st 5 years
of such service
For 2d 5 years of
such service
Not more than 8,500 ............................................................
$.0060
$.0038
More than 8,500 but not more than 8,650 ..........................
$.0025
$.0010
More than 8,650 but not more than 8,750 ..........................
$.0010
$.0010.
‘‘(B) In the case of a facility originally
placed in service after 2008 and before 2013,
if—
‘‘The facility design net heat rate, Btu/kWh (HHV) is
equal to:
The applicable amount is:
For 1st 5 years
of such service
For 2d 5 years of
such service
Not more than 8,000 ............................................................
$.0105
$.009
More than 8,000 but not more than 8,250 ..........................
$.0085
$.0068
More than 8,250 but not more than 8,400 ..........................
$.0075
$.0055.
‘‘(C) In the case of a facility originally
placed in service after 2012 and before 2017,
if—
‘‘The facility design net heat rate, Btu/kWh (HHV) is
equal to:
The applicable amount is:
For 1st 5 years
of such service
For 2d 5 years of
such service
Not more than 7,800 ............................................................
$.0140
$.0115
More than 7,800 but not more than 7,950 ..........................
$.0120
$.0090.
‘‘(3) Where the clean coal technology facility is
producing fuel or chemicals:
‘‘(A) In the case of a facility originally
placed in service before 2009, if—
139
‘‘The facility design net thermal efficiency (HHV) is equal
to:
The applicable amount is:
For 1st 5 years
of such service
For 2d 5 years of
such service
Not less than 40.6 percent ...................................................
$.0060
$.0038
Less than 40.6 but not less than 40 percent .......................
$.0025
$.0010
Less than 40 but not less than 39 percent ..........................
$.0010
$.0010.
‘‘(B) In the case of a facility originally
placed in service after 2008 and before 2013,
if—
‘‘The facility design net thermal efficiency (HHV) is equal
to:
The applicable amount is:
For 1st 5 years
of such service
For 2d 5 years of
such service
Not less than 43.9 percent ...................................................
$.0105
$.009
Less than 43.9 but not less than 42 percent .......................
$.0085
$.0068
Less than 42 but not less than 40.9 percent .......................
$.0075
$.0055.
‘‘(C) In the case of a facility originally
placed in service after 2012 and before 2017,
if—
‘‘The facility design net thermal efficiency (HHV) is equal
to:
The applicable amount is:
For 1st 5 years
of such service
For 2d 5 years of
such service
Not less than 44.2 percent ...................................................
$.0140
$.0115
Less than 44.2 but not less than 43.6 percent ....................
$.0120
$.0090.
‘‘(c) INFLATION ADJUSTMENT FACTOR.—For cal-
endar years after 2001, each amount in paragraphs (1),
(2), and (3) shall be adjusted by multiplying such amount
by the inflation adjustment factor for the calendar year
in which the amount is applied. If any amount as in-
creased under the preceding sentence is not a multiple of
0.01 cent, such amount shall be rounded to the nearest
multiple of 0.01 cent.
140
‘‘(d) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section—
‘‘(1) IN GENERAL.—Any term used in this sec-
tion which is also used in section 48B shall have the
meaning given such term in section 48B.
‘‘(2) APPLICABLE RULES.—The rules of para-
graphs (3), (4), and (5) of section 45 shall apply.
‘‘(3) INFLATION
ADJUSTMENT
FACTOR.—The
term ‘inflation adjustment factor’ means, with re-
spect to a calendar year, a fraction the numerator
of which is the GDP implicit price deflator for the
preceding calendar year and the denominator of
which is the GDP implicit price deflator for the cal-
endar year 2001.
‘‘(4) GDP IMPLICIT
PRICE
DEFLATOR.—The
term ‘GDP implicit price deflator’ means the most
recent revision of the implicit price deflator for the
gross domestic product as computed by the Depart-
ment of Commerce before March 15 of the calendar
year.’’.
(b) CREDIT TREATED AS BUSINESS CREDIT.—Sec-
tion 38(b) of the Internal Revenue Code of 1986, as
amended by section 202(b), is amended by striking ‘‘plus’’
at the end of paragraph (15), by striking the period at
141
the end of paragraph (16) and inserting ‘‘, plus’’, and by
adding at the end the following:
‘‘(17) the qualifying advanced clean coal tech-
nology production credit determined under section
45H(a).’’.
(c) TRANSITIONAL RULE.—Section 39(d) of the In-
ternal Revenue Code of 1986 (relating to transitional
rules), as amended by section 301(d), is amended by add-
ing at the end the following:
‘‘(14) NO CARRYBACK OF SECTION 45H CREDIT
BEFORE EFFECTIVE DATE.—No portion of the un-
used business credit for any taxable year which is
attributable to the qualifying advanced clean coal
technology production credit determined under sec-
tion 45H may be carried back to a taxable year end-
ing before the date of enactment of section 45H.’’.
(d) CLERICAL AMENDMENT.—The table of sections
for subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986, as amended by sec-
tion 202(d), is amended by adding at the end the fol-
lowing:
‘‘Sec. 45H. Credit for production from qualifying advanced clean
coal technology.’’.
(e) EFFECTIVE DATE.—The amendments made by
this section shall apply to production after the date of en-
actment of this Act.
142
SEC. 533. RISK POOL FOR QUALIFYING ADVANCED CLEAN
COAL TECHNOLOGY.
(a) ESTABLISHMENT.—The Secretary of the Treas-
ury shall establish a financial risk pool which shall be
available to any United States owner of a qualifying ad-
vanced clean coal technology which has qualified for an
advanced clean coal technology production credit (as de-
fined in section 45H of the Internal Revenue Code of
1986, as added by section 302) to offset for the first 3
years of the operation of such technology the costs (not
to exceed 5 percent of the total cost of installation) for
modifications resulting from the technology’s failure to
achieve its design performance.
(b) AUTHORIZATION OF APPROPRIATIONS.—There is
authorized to be appropriated such sums as are necessary
to carry out the purposes of this section.
Subtitle D—Treatment of Certain
Governmental and Other Entities
SEC. 541. CREDITS FOR CERTAIN ORGANIZATIONS AND
GOVERNMENTAL UNITS.
Section 6401(b) of the Internal Revenue Code of
1986 (relating to excessive credits) is amended by adding
at the end the following:
‘‘(3) CREDITS
FOR
CERTAIN
ORGANIZATIONS
AND GOVERNMENTAL UNITS.—
143
‘‘(A) ALLOWANCE OF CREDITS.—Any cred-
it which would be allowable under section 45G,
45H, 48A, or 48B with respect to a facility of
an entity whether or not such entity is exempt
from tax, shall be treated as a credit allowable
under subpart C of part IV of subchapter A of
chapter 1 of subtitle A to such entity if such
entity is—
‘‘(i) an organization described in sec-
tion 501(c)(12)(C) and exempt from tax
under section 501(a),
‘‘(ii) an organization described in sec-
tion 1381(a)(2)(C),
‘‘(iii) a public utility (as defined in
section 136(c)(2)(B)),
‘‘(iv) a State, the District of Colum-
bia, or a possession of the United States,
or any political subdivision thereof, or
‘‘(v) the Tennessee Valley Authority.
‘‘(B) USE OF CREDIT.—
‘‘(i) TRANSFER OF CREDIT.—An enti-
ty described in clause (i), (ii), (iii), or (iv)
of subparagraph (A) may assign, trade,
sell, or otherwise transfer any credit allow-
144
able to such entity under subparagraph
(A) to any other person or entity.
‘‘(ii) USE
OF
CREDIT
AS
AN
OFF-
SET.—Notwithstanding any other provision
of law, in the case of any entity described
in clause (i) or (ii) of subparagraph (A),
any credit allowable to such entity under
subparagraph (A) may be applied by such
entity, without penalty, as a prepayment of
any loan, debt or other obligation the enti-
ty has made, incurred or guaranteed under
the Rural Electrification Act of 1936 (7
U.S.C. 901 et seq.).
‘‘(iii) USE BY TVA.—
‘‘(I) 
IN
GENERAL.—Notwith-
standing any other provision of law, in
the case of an entity described in sub-
paragraph (A)(v), any credit allowable
under subparagraph (A) to such enti-
ty may be applied as a credit against
the payments required to be made in
any fiscal year under section 15d(e) of
the Tennessee Valley Authority Act of
1933 (16 U.S.C. 83ln–4(e)) as an an-
nual return on the appropriations in-
145
vestment and an annual repayment
sum.
‘‘(II) 
TREATMENT
OF
CRED-
ITS.—The aggregate amount of cred-
its described in subparagraph (A)
shall be treated in the same manner
and to the same extent as if such
credits were a payment in cash and
shall be applied first against the an-
nual return on the appropriations in-
vestment.
‘‘(III) 
CREDIT
CARRYOVER.—
With respect to any fiscal year, if the
aggregate amount of the credits de-
scribed in subparagraph (A) exceeds
the aggregate amount of payment ob-
ligations described in subclause (I),
the excess amount shall remain avail-
able for application as credits against
the amounts of such payment obliga-
tions in succeeding fiscal years in the
same manner as described in this
clause.
‘‘(C) CREDIT
NOT
INCOME.—Neither a
transfer under clause (i) nor a use under clause
146
(ii) of subparagraph (B) of any credit allowable
under subparagraph (A) shall result in income
for purposes of section 501(c)(12).
‘‘(D) TRANSFER PROCEEDS TREATED AS
ARISING FROM ESSENTIAL GOVERNMENT FUNC-
TION.—Any proceeds derived by an entity de-
scribed in clause (iii) or (iv) of subparagraph
(A) from the transfer of any such credit under
subparagraph (B)(I) shall be treated as arising
from an essential government function.
‘‘(E) TREATMENT
OF
UNRELATED
PER-
SONS.—For purposes of this title, sales among
and between entities described in clauses (i),
(ii), (iii), and (iv) of subparagraph (A) shall be
treated as sales between unrelated parties.’’.
TITLE VI—FUELS
SEC. 601. TANK DRAINING DURING TRANSITION TO SUM-
MERTIME RFG.
Not later than 60 days after the enactment of the
Act, the Administrator of the Environmental Protection
Agency shall commence a rulemaking to determine wheth-
er modifications to the regulations set forth in 40 C.F.R.
Section 80.78 and any associated regulations regarding
the transition to high ozone season reformulated gasoline
are necessary to ensure that the transition to high ozone
147
season reformulated gasoline is conducted in a manner
that minimizes disruptions to the general availability and
affordability of gasoline, and maximizes flexibility with re-
gard to the draining and inventory management of gaso-
line storage tanks located at refineries, terminals, whole-
sale and retail outlets, consistent with the goals of the
Clean Air Act. The Administrator shall propose and take
final action in such rulemaking to ensure that any modi-
fications are effective and implemented at least 60 days
prior to the beginning of the high ozone season for the
year 2002.
SEC. 602. GASOLINE BLENDSTOCK REQUIREMENTS.
Not later than 60 days after the enactment of this
Act, the Administrator of the Environmental Protection
Agency shall commence a rulemaking to determine wheth-
er modifications to product transfer documentation, ac-
counting, compliance calculation, and other requirements
contained in the regulations of the Administrator set forth
in section 80.102 of title 40 of the Code of Federal Regu-
lations relating to gasoline blendstocks are necessary to
facilitate the movement of gasoline and gasoline feedstocks
among different regions throughout the country and to im-
prove the ability of petroleum refiners and importers to
respond to regional gasoline shortages and prevent unrea-
sonable short-term price increases. The Administrator
148
shall take into consideration the extent to which such re-
quirements have been, or will be, rendered unnecessary or
inefficient by reason of subsequent environmental safe-
guards that were not in effect at the time the regulations
in section 80.102 of title 40 of the Code of Federal Regu-
lations were promulgated. The Administrator shall pro-
pose and take final action in such rulemaking to ensure
that any modifications are effective and implemented at
least 60 days prior to the beginning of the high ozone sea-
son for the year 2002.
SEC. 603. BOUTIQUE FUELS.
(a) JOINT STUDY.—The Administrator of the Envi-
ronmental Protection Agency and the Secretary of Energy
shall jointly conduct a study of all Federal, State, and
local requirements regarding motor vehicle fuels, including
requirements relating to reformulated gasoline, volatility
(Reid Vapor Pressure), oxygenated fuel, diesel fuel and
other requirements that vary from State to State, region
to region, or locality to locality. The study shall analyze—
(1) the effect of the variety of such require-
ments on the price of motor vehicle fuels to the con-
sumer;
(2) the availability and affordability of motor
vehicle fuels in different States and localities;
149
(3) the effect of Federal, State, and local regu-
lations, including multiple fuel requirements, on do-
mestic refineries and the fuel distribution system;
(4) the effect of such requirements on local, re-
gional, and national air quality requirements and
goals;
(5) the effect of such requirements on vehicle
emissions;
(6) the feasibility of developing national or re-
gional fuel specifications for the contiguous United
States that would—
(A) enhance flexibility in the fuel distribu-
tion infrastructure and improve fuel fungibility;
(B) reduce price volatility and costs to con-
sumers and producers;
(C) meet local, regional, and national air
quality requirements and goals; and
(D) provide increased gasoline market li-
quidity; and
(7) the extent to which the Environmental Pro-
tection Agency’s Tier II requirements for conven-
tional gasoline may achieve in future years the same
or similar air quality results as State reformulated
gasoline programs and State programs regarding
gasoline volatility (RVP).
150
(b) REPORT.—By December 31, 2001, the Adminis-
trator of the Environmental Protection Agency and the
Secretary of Energy shall submit a report to the Congress
containing the results of the study conducted under sub-
section (a). Such report shall contain recommendations for
legislative and administrative actions that may be taken
to simplify the national distribution system for motor vehi-
cle fuel, make such system more cost-effective, and reduce
the costs and increase the availability of motor vehicle fuel
to the end user while meeting the requirements of the
Clean Air Act. Such recommendations shall take into ac-
count the need to provide lead time for refinery and fuel
distribution system modifications necessary to assure ade-
quate fuel supply for all States.
SEC. 604. FUNDING FOR MTBE CONTAMINATION.
Notwithstanding any other provision of law, there is
authorized to be appropriated to the Administrator of the
Environmental Protection Agency from the Leaking Un-
derground 
Storage 
Trust 
Fund 
not 
more 
than
$200,000,000 to be used for taking such action, limited
to assessment, corrective action, inspection of under-
ground storage tank systems, and groundwater monitoring
in connection with MTBE contamination, as the Adminis-
trator deems necessary to protect human health and the
151
environment from releases of methyl tertiary butyl ether
(MTBE) from underground storage tanks.
TITLE VII—RENEWABLE ENERGY
SEC. 701. ASSESSMENT OF RENEWABLE ENERGY RE-
SOURCES.
(a) RESOURCE ASSESSMENT.—Not later than one
year after the date of enactment of this Act, and each
year thereafter, the Secretary of Energy shall publish an
assessment by the National Laboratories of all renewable
energy resources available within the United States.
(b) CONTENTS OF REPORT.—The report published
under subsection (a) shall contain each of the following:
(1) A detailed inventory describing the available
amount and characteristics of solar, wind, biomass,
geothermal, hydroelectric and other renewable en-
ergy sources.
(2) Such other information as the Secretary of
Energy believes would be useful in developing such
renewable energy resources, including descriptions of
surrounding terrain, population and load centers,
nearby energy infrastructure, location of energy and
water resources, and available estimates of the costs
needed to develop each resource.
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SEC. 702. RENEWABLE ENERGY PRODUCTION INCENTIVE.
Section 1212 of the Energy Policy Act of 1992 (42
U.S.C. 13317) is amended as follows:
(1) In subsection (a) by striking ‘‘and which
satisfies’’ and all that follows through ‘‘Secretary
shall establish.’’ and inserting ‘‘. The Secretary shall
establish other procedures necessary for efficient ad-
ministration of the program. The Secretary shall not
establish any criteria or procedures that have the ef-
fect of assigning to proposals a higher or lower pri-
ority for eligibility or allocation of appropriated
funds on the basis of the energy source proposed.’’.
(2) In subsection (b)—
(A) by striking ‘‘a State or any political’’
and all that follows through ‘‘nonprofit elec-
trical cooperative’’ and inserting ‘‘an electricity-
generating cooperative exempt from taxation
under 
section 
501(c)(12) 
or 
section
1381(a)(2)(C) of the Internal Revenue Code of
1986, a public utility described in section 115
of such Code, a State, Commonwealth, terri-
tory, or possession of the United States or the
District of Columbia, or a political subdivision
thereof, or an Indian tribal government or sub-
division thereof,’’; and
153
(B) By inserting ‘‘landfill gas,’’ after
‘‘wind, biomass,’’.
(3) In subsection (c) by striking ‘‘during the
10-fiscal year period beginning with the first full fis-
cal year occurring after the enactment of this sec-
tion’’ and inserting ‘‘before October 1, 2013’’.
(4) In subsection (d) by inserting ‘‘or in which
the Secretary finds that all necessary Federal and
State authorizations have been obtained to begin
construction of the facility’’ after ‘‘eligible for such
payments’’.
(5) In subsection (e)(1) by inserting ‘‘landfill
gas,’’ after ‘‘wind, biomass,’’.
(6) In subsection (f) by striking ‘‘the expiration
of’’ and all that follows through ‘‘of this section’’
and inserting ‘‘September 30, 2023’’.
(7) In subsection (g)—
(A) by striking ‘‘1993, 1994, and 1995’’
and inserting ‘‘2003 through 2023’’; and
(B) by inserting ‘‘Funds may be appro-
priated pursuant to this subsection to remain
available until expended.’’ after ‘‘purposes of
this section.’’.
154
TITLE VIII—PIPELINE
INTEGRITY
Subtitle A—Pipeline Integrity
SEC. 801. PROGRAM FOR PIPELINE INTEGRITY RESEARCH,
DEVELOPMENT, AND DEMONSTRATION.
(a) IN GENERAL.—The Secretary of Transportation,
in coordination with the Secretary of Energy, and in con-
sultation with the Federal Energy Regulatory Commis-
sion, shall develop and implement an accelerated coopera-
tive program of research, development, and demonstration
to ensure the integrity of natural gas and hazardous liquid
pipelines. This program shall include materials inspection
techniques, risk assessment methodology, and information
systems surety.
(b) PURPOSE.—The purpose of the cooperative re-
search program shall be to promote research, development,
and demonstration to—
(1) ensure long-term safety, reliability, and
service life for existing pipelines;
(2) expand capabilities of internal inspection
devices to identify and accurately measure defects
and anomalies;
(3) develop inspection techniques for pipelines
that cannot accommodate the internal inspection de-
vices;
155
(4) develop innovative techniques to measure
the structural integrity of pipelines to prevent pipe-
line failures;
(5) develop improved materials and coatings for
use in pipelines;
(6) improve the capability, reliability, and prac-
ticality of external leak detection devices;
(7) identify underground environments that
might lead to shortened service life;
(8) enhance safety in pipeline siting and land
use;
(9) minimize the environmental impact of pipe-
lines;
(10) demonstrate technologies that improve
pipeline safety, reliability, and integrity;
(11) provide risk assessment tools for opti-
mizing risk mitigation strategies; and
(12) provide highly secure information systems
for controlling the operation of pipelines.
(c) AREAS.—In carrying out this subtitle, the Sec-
retary of Transportation, in coordination with the Sec-
retary of Energy, shall consider research, development,
and demonstration on natural gas, crude oil, and petro-
leum product pipelines for—
156
(1) early crack, defect, and damage detection,
including real-time damage monitoring;
(2) automated internal pipeline inspection sen-
sor systems;
(3) land use guidance and set back manage-
ment along pipeline rights-of-way for communities;
(4) internal corrosion control;
(5) corrosion-resistant coatings;
(6) improved cathodic protection;
(7) inspection techniques where internal inspec-
tion is not feasible, including measurement of struc-
tural integrity;
(8) external leak detection, including portable
real-time video imaging technology, and the advance-
ment of computerized control center leak detection
systems utilizing real-time remote field data input;
(9) longer life, high strength, noncorrosive pipe-
line materials;
(10) assessing the remaining strength of exist-
ing pipes;
(11) risk and reliability analysis models, to be
used to identify safety improvements that could be
realized in the near term resulting from analysis of
data obtained from a pipeline performance tracking
initiative;
157
(12) identification, monitoring, and prevention
of outside force damage, including satellite surveil-
lance; and
(13) any other areas necessary to ensuring the
public safety and protecting the environment.
(d) RESEARCH, DEVELOPMENT, AND DEMONSTRA-
TION PROGRAM PLAN.—Within 240 days after the date
of enactment of this Act, the Secretary of Transportation,
in coordination with the Secretary of Energy, the Federal
Energy Regulatory Commission, and the Pipeline Integ-
rity Technical Advisory Committee, shall prepare and sub-
mit to the Congress a 5-year program plan to guide activi-
ties under this subtitle. In preparing the program plan,
the Secretary shall consult with appropriate representa-
tives of the natural gas, crude oil, and petroleum product
pipeline industries to select and prioritize appropriate
project proposals. The Secretary may also seek the advice
of utilities, manufacturers, institutions of higher learning,
Federal agencies, the pipeline research institutions, na-
tional laboratories, State pipeline safety officials, environ-
mental organizations, pipeline safety advocates, and pro-
fessional and technical societies.
(e) IMPLEMENTATION.—The Secretary of Transpor-
tation shall have primary responsibility for ensuring the
158
five-year plan provided for in subsection (d) is imple-
mented as intended by this subtitle.
(f) REPORTS
TO
CONGRESS.—The Secretary of
Transportation shall report to the Committee on Energy
and Commerce and the Committee on Transportation and
Infrastructure of the House of Representatives, and to the
Committee on Energy and Natural Resources and the
Committee on Commerce, Science, and Transportation of
the Senate, annually as to the status and results to date
of the implementation of the program plan. The report
shall include the activities of the Departments of Trans-
portation and Energy, the national laboratories, univer-
sities, and any other research organizations, including in-
dustry research organizations.
SEC. 802. PIPELINE INTEGRITY TECHNICAL ADVISORY
COMMITTEE.
(a) ESTABLISHMENT.—The Secretary of Transpor-
tation shall enter into appropriate arrangements with the
National Academy of Sciences to establish and manage the
Pipeline Integrity Technical Advisory Committee for the
purpose of advising the Secretary of Transportation and
the Secretary of Energy on the development and imple-
mentation of the five-year research, development, and
demonstration program plan under section 801(d). The
Advisory Committee shall have an ongoing role in evalu-
159
ating the progress and results of the research, develop-
ment, and demonstration carried out under this subtitle.
(b) 
MEMBERSHIP.—The 
National 
Academy 
of
Sciences shall appoint the members of the Pipeline Integ-
rity Technical Advisory Committee after consultation with
the Secretary of Transportation and the Secretary of En-
ergy. The Advisory Committee shall also have 1 member
from the Federal Energy Regulatory Commission. Mem-
bers appointed to the Advisory Committee should have the
necessary qualifications to provide technical contributions
to the purposes of the Advisory Committee.
SEC. 803. AUTHORIZATION OF APPROPRIATIONS.
(a) AUTHORIZATION FROM USER FEES.—There are
authorized to be appropriated to the Secretary of Trans-
portation for carrying out this subtitle $3,000,000, which
is to be derived from user fees under section 60125 of
title 49, United States Code, for each of the fiscal years
2002 through 2006.
(b) DETECTION, PREVENTION, AND MITIGATION.—
There are authorized to be appropriated to the Secretary
of Transportation from the Oil Spill Liability Trust Fund
(26 U.S.C. 9509), $3,000,000 to carry out programs for
detection, prevention, and mitigation of oil spills author-
ized in this subtitle for each of the fiscal years 2002
through 2006.
160
(c) GENERAL AUTHORIZATION.—There are author-
ized to be appropriated to the Secretary of Energy for car-
rying out this subtitle such sums as may be necessary for
each of the fiscal years 2002 through 2006.
Subtitle B—Other Pipeline
Provisions
SEC. 811. PROHIBITION ON CERTAIN PIPELINE ROUTE.
No license, permit, lease, right-of-way, authorization
or other approval required under Federal law for the con-
struction of any pipeline to transport natural gas from
lands within the Prudhoe Bay oil and gas lease area may
be granted for any pipeline that follows a route that
traverses—
(1) the submerged lands (as defined by the
Submerged Lands Act) beneath, or the adjacent
shoreline of, the Beaufort Sea; and
(2) enters Canada at any point north of 68 de-
grees North latitude.
SEC. 812. HISTORIC PIPELINES.
Section 7 of the Natural Gas Act (15 U.S.C. 717f)
is amended by adding at the end the following new sub-
section:
‘‘(i) Notwithstanding the National Historic Preserva-
tion Act, a transportation facility shall not be eligible for
inclusion on the National Register of Historic Places until