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‘‘(5) COAL.—The term ‘coal’ means any carbon-
ized or semicarbonized matter, including peat.
‘‘(6) ELIGIBLE ENTITY.—The term ‘eligible enti-
ty’ means any person whose application for certifi-
cation is principally intended for use in a domestic
project which employs domestic gasification applica-
tions related to—
‘‘(A) chemicals,
‘‘(B) fertilizers,
‘‘(C) glass,
‘‘(D) steel,
‘‘(E) petroleum residues,
‘‘(F) forest products, and
‘‘(G) agriculture, including feedlots and
dairy operations.
‘‘(7) PETROLEUM
RESIDUE.—The term ‘petro-
leum residue’ means the carbonized product of high-
boiling hydrocarbon fractions obtained in petroleum
processing.
‘‘(d) QUALIFYING
GASIFICATION
PROJECT
PRO-
GRAM.—
‘‘(1) IN GENERAL.—The Secretary, in consulta-
tion with the Secretary of Energy, shall establish a
qualifying gasification project program to consider
and award certifications for qualified investment eli-
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gible for credits under this section to qualifying gas-
ification project sponsors under this section. The total
qualified investment which may be awarded eligi-
bility for credit under the program shall not exceed
$4,000,000,000.
‘‘(2) PERIOD OF ISSUANCE.—A certificate of eli-
gibility under paragraph (1) may be issued only dur-
ing the 10-fiscal year period beginning on October 1,
2005.
‘‘(3) SELECTION CRITERIA.—The Secretary shall
not make a competitive certification award for quali-
fied investment for credit eligibility under this section
unless the recipient has documented to the satisfaction
of the Secretary that—
‘‘(A) the award recipient is financially via-
ble without the receipt of additional Federal
funding associated with the proposed project,
‘‘(B) the recipient will provide sufficient in-
formation to the Secretary for the Secretary to
ensure that the qualified investment is spent effi-
ciently and effectively,
‘‘(C) a market exists for the products of the
proposed project as evidenced by contracts or
written statements of intent from potential cus-
tomers,
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HR 6 EAS
‘‘(D) the fuels identified with respect to the
gasification technology for such project will com-
prise at least 90 percent of the fuels required by
the project for the production of chemical feed-
stocks, liquid transportation fuels, or coproduc-
tion of electricity,
‘‘(E) the award recipient’s project team is
competent in the construction and operation of
the gasification technology proposed, with pref-
erence given to those recipients with experience
which demonstrates successful and reliable oper-
ations of the technology on domestic fuels so
identified, and
‘‘(F) the award recipient has met other cri-
teria established and published by the Sec-
retary.’’.
(c) CONFORMING AMENDMENTS.—
(1) Section 49(a)(1)(C) is amended by striking
‘‘and’’ at the end of clause (ii), by striking clause
(iii), and by adding after clause (ii) the following
new clauses:
‘‘(iii) the basis of any property which
is part of a qualifying advanced coal
project under section 48A, and
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‘‘(iv) the basis of any property which
is part of a qualifying gasification project
under section 48B.’’.
(2) The table of sections for subpart E of part IV
of subchapter A of chapter 1 is amended by inserting
after the item relating to section 48 the following new
items:
‘‘48A. Qualifying advanced coal project credit.
‘‘48B. Qualifying gasification project credit.’’.
(e) EFFECTIVE DATE.—The amendments made by this
section shall apply to periods after the date of the enactment
of this Act, 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 the enactment of the Revenue Rec-
onciliation Act of 1990).
SEC. 1509. CLEAN ENERGY COAL BONDS.
(a) IN GENERAL.—Subpart H of part IV of subchapter
A of chapter 1 (relating to credits against tax), as added
by this Act, is amended by adding at the end the following
new section:
‘‘SEC. 54A. CREDIT TO HOLDERS OF CLEAN ENERGY COAL
BONDS.
‘‘(a) ALLOWANCE OF CREDIT.—If a taxpayer holds a
clean energy coal bond on 1 or more credit allowance dates
of the bond occurring during any taxable year, there shall
be allowed as a credit against the tax imposed by this chap-
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ter for the taxable year an amount equal to the sum of the
credits determined under subsection (b) with respect to such
dates.
‘‘(b) AMOUNT OF CREDIT.—
‘‘(1) IN GENERAL.—The amount of the credit de-
termined under this subsection with respect to any
credit allowance date for a clean energy coal bond is
25 percent of the annual credit determined with re-
spect to such bond.
‘‘(2) ANNUAL CREDIT.—The annual credit deter-
mined with respect to any clean energy coal bond is
the product of—
‘‘(A) the credit rate determined by the Sec-
retary under paragraph (3) for the day on which
such bond was sold, multiplied by
‘‘(B) the outstanding face amount of the
bond.
‘‘(3) DETERMINATION.—For purposes of para-
graph (2), with respect to any clean energy coal bond,
the Secretary shall determine daily or cause to be de-
termined daily a credit rate which shall apply to the
first day on which there is a binding, written con-
tract for the sale or exchange of the bond. The credit
rate for any day is the credit rate which the Sec-
retary or the Secretary’s designee estimates will per-
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mit the issuance of clean energy coal bonds with a
specified maturity or redemption date without dis-
count and without interest cost to the qualified issuer.
‘‘(4) CREDIT ALLOWANCE DATE.—For purposes
of this section, the term ‘credit allowance date’
means—
‘‘(A) March 15,
‘‘(B) June 15,
‘‘(C) September 15, and
‘‘(D) December 15.
Such term also includes the last day on which the
bond is outstanding.
‘‘(5) SPECIAL RULE FOR ISSUANCE AND REDEMP-
TION.—In the case of a bond which is issued during
the 3-month period ending on a credit allowance date,
the amount of the credit determined under this sub-
section with respect to such credit allowance date
shall be a ratable portion of the credit otherwise deter-
mined based on the portion of the 3-month period
during which the bond is outstanding. A similar rule
shall apply when the bond is redeemed or matures.
‘‘(c) LIMITATION BASED ON AMOUNT OF TAX.—The
credit allowed under subsection (a) for any taxable year
shall not exceed the excess of—