A bill to authorize a short-term program of grants to certain electric utilities to be passed through, in the form of credits toward electric bills, to consumers that reduce electric energy consumption and to establish an Electric Energy Conservation Fund to provide loans to utilities and nonprofit organizations to fund energy productivity projects.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Savings Through Energy Productivity 
Act'' or the ``STEP Act''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Eligible utility.--The term ``eligible utility'' means 
        an electric utility that, during any 12-month period beginning 
        on or after January 1, 2000, increased or increases the rates 
        charged to all categories of its customers by a weighted 
        average of 20 percent or more in order to cover increases in 
        the cost of generating or acquiring electricity.
            (2) Energy productivity project.--The term ``energy 
        productivity project'' means a project to--
                    (A) construct a facility or install equipment that 
                uses energy-efficient technology in the generation or 
                use of electric energy; or
                    (B) conduct a program, not conducted by the 
                applicant for a grant under section 4 before the date 
                of application for the grant, to increase the 
                productivity of a utility.
            (3) Fund.--The term ``Fund'' means the STEP Fund 
        established by section 4.
            (4) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.
            (5) Utility.--The term ``utility'' means an electric 
        utility (as defined in section 3 of the Federal Power Act (16 
        U.S.C. 796)) that is subject to regulation by a State 
        commission (as defined in that section).

SEC. 3. IMMEDIATE ELECTRIC ENERGY COST RELIEF FOR CONSUMERS THAT REDUCE 
              ENERGY CONSUMPTION.

    (a) In General.--The Secretary shall establish a program, to be 
known as the ``STEP Emergency Rebate Program'', under which the 
Secretary makes grants to eligible utilities to pay the costs of 
providing rebates or credits against the amounts of electric bills of 
customers that reduce the amount of electric energy consumed by the 
customer.
    (b) Credits for Reduction of Electric Energy Consumption.--
            (1) In general.--To receive a grant under subsection (a), 
        an eligible utility shall agree to provide its customers 
        rebates and credits as provided in this subsection.
            (2) First period of qualification.--During the first 12-
        month period in which a utility customer qualifies for rebates 
        or credits under this section, the customer shall be entitled 
        to a rebate of a portion of the amount of an electric bill 
        paid, or a credit against the amount of an electric bill, for 
        each billing period, in an amount that is proportionate to the 
        percentage by which the amount of electric energy consumed by 
        the customer during the billing period is less than the amount 
        consumed during the equivalent billing period in the preceding 
        year (referred to in this section as the ``base billing 
        period'').
            (3) Second period of qualification.--During the second 12-
        month period in which a utility customer qualifies for rebates 
        or credits under this section, the customer shall be entitled 
        to a rebate of a portion of the amount of an electric bill 
        paid, or a credit against the amount of an electric bill, for 
        each billing period, in an amount that is proportionate to the 
        percentage by which the amount of electric energy consumed by 
        the customer during the billing period is less than the amount 
        consumed during the base billing period.
            (4) New customers.--In the case of a customer to which an 
        eligible utility has sold electric energy for less than a year, 
        the proportion by which the customer shall be considered to 
        have reduced electric energy consumption during a month shall 
        be determined by comparing the amount of electric energy 
        consumed by the customer during the month against a local area 
        baseline determined in accordance with regulations promulgated 
        by the Secretary.
            (5) Percentage reduction.--
                    (A) Limitation.--A utility customer shall be 
                entitled to a rebate or credit only to the extent that 
                the percentage described in paragraph (3) or (4) is 
                between 5.0 percent and 20.0 percent, inclusive.
                    (B) Rounding.--For the purposes of determining the 
                amount of a rebate or credit, a described in paragraph 
                (3) or (4) shall be rounded to the nearest tenth of a 
                percent.
    (c) Action by the Secretary.--
            (1) Expeditious relief.--In order to provide energy cost 
        relief to consumers as expeditiously as possible, the Secretary 
        shall act on an application for a grant under subsection (a) 
        within 30 days after receiving the application.
            (2) Failure to act.--If the Secretary fails to act on an 
        application for a grant within 30 days after receiving the 
        application, the application shall be deemed to be granted.
            (3) Denial of application.--If the Secretary denies an 
        application, the Secretary shall include in the denial--
                    (A) a detailed statement of the reasons for the 
                denial; and
                    (B) a description any action that the applicant may 
                make to obtain approval of the application.
    (d) Authorization of Appropriations.--
            (1) In general.--There are authorized to be appropriated 
        such sums as are necessary to carry out this section for fiscal 
        years 2002 and 2003.
            (2) Administrative expenses.--The Secretary shall use not 
        more than 5 percent of the amount made available to carry out 
        this section for a fiscal year to pay administrative expenses.
    (e) Cessation of Effectiveness.--
            (1) In general.--This section ceases to be in effect on 
        October 1, 2003.
            (2) Transfer to the fund.--Any balance of the amounts made 
        available to carry out this section that remain unexpended on 
        September 30, 2003, shall be transferred to the Fund.

SEC. 4. STEP FUND.

    (a) Establishment.--There is established in the Treasury of the 
United States a revolving fund to be known as the ``STEP Fund'', 
consisting of--
            (1) amounts appropriated to the Fund under subsection (f);
            (2) amounts of loans repaid to the Fund under subsection 
        (b)(2)(B);
            (3) amounts of interest earned on investment of amounts in 
        the Fund under subsection (c); and
            (4) amounts transferred to the Fund under section 3(e)(2).
    (b) Loan program.--
            (1) In general.--The Secretary shall establish a program 
        under which the Secretary, using amounts in the Fund, makes 
        loans to utilities and nonprofit organizations, at no interest, 
        to pay up to 100 percent of the cost of an energy productivity 
        project.
            (2) Repayment.--
                    (A) Schedule.--The Secretary shall require 
                repayment of a loan on a schedule that takes into 
                account the length of time that will be required for 
                the amount of savings that is expected to be realized 
                from an energy productivity project to equal the cost 
                of the energy productivity project.
                    (B) Deposit in fund.--The Secretary shall deposit 
                amounts received in repayment of a loan in the Fund.
    (c) Investment of Amounts.--
            (1) In general.--The Secretary of the Treasury shall invest 
        such portion of the Fund as is not, in the judgment of the 
        Secretary of the Treasury, required to meet current 
        withdrawals. Investments may be made only in interest-bearing 
        obligations of the United States.
            (2) Acquisition of obligations.--For the purpose of 
        investments under paragraph (1), obligations may be acquired--
                    (A) on original issue at the issue price; or
                    (B) by purchase of outstanding obligations at the 
                market price.
            (3) Sale of obligations.--Any obligation acquired by the 
        Fund may be sold by the Secretary of the Treasury at the market 
        price.
            (4) Credits to fund.--The interest on, and the proceeds 
        from the sale or redemption of, any obligations held in the 
        Fund shall be credited to and form a part of the Fund.
    (d) Availability.--Amounts in the Fund shall be available to the 
Secretary, without further appropriation, to make loans under 
subsection (b).
    (e) Reports.--Not later than 1 year after the date on which a 
utility or nonprofit organization receives a loan under this section, 
and annually thereafter until such date as the loan is repaid in full, 
the loan recipient shall submit to the Secretary of Energy a report 
that describes--
            (1) any electricity savings or peak demand reductions 
        resulting from the implementation of activities carried out 
        using loan funds; and
            (2) an estimate of the annual cost-effectiveness of all 
        programs carried out by the loan recipient in the year for 
        which the report is submitted.
    (f) Authorization of Appropriations.--There are authorized to be 
appropriated to the Fund such sums as are necessary to carry out this 
section.
    (g) Cessation of Effectiveness.--This section ceases to be in 
effect on the date that is 10 years after the date of enactment of this 
Act.

Summary: Savings Through Energy Productivity Act, or the STEP Act - Directs the Secretary of Energy to establish the STEP Emergency Rebate Program (STEP), under which the Secretary makes grants to eligible utilities to pay the costs of providing rebates or credits against the amounts of electric bills of customers that reduce the amount of electric energy consumed.Establishes the STEP Fund in the Treasury. Instructs the Secretary to establish a program making no-interest loans to utilities and nonprofit organizations to pay up to 100 percent of the cost of an energy productivity project. Requires an annual accounting by loan recipients.