Fuel Choice and Deregulation Act of 2021
Bill: S.667 | Sponsor: Sen. Paul, Rand (R-KY)
Policy area: Environmental Protection

Summary:
Fuel Choice and Deregulation Act of 2021
This bill revises requirements governing the use of alternative fuels in vehicles.
Among other things, the bill revises requirements on aftermarket vehicle conversions that enable older vehicles to use alternative fuels. Under current law, the Environmental Protection Agency (EPA) must certify such conversions. This bill removes such certification requirements.
The bill also bans the EPA from prohibiting or controlling biomass fuel.
In addition, the bill revises the Corporate Average Fuel Economy standards for certain vehicles that are able to operate on something other than petroleum-based fuel, such as electric vehicles.
Finally, the bill revises the Reid Vapor Pressure (RVP) requirements to provide for the year-round sale of ethanol-gasoline fuel blends that contain more than 10% denatured anhydrous ethanol. RVP is a metric of gasoline volatility (i.e., how quickly fuel evaporates into the atmosphere). Current law prohibits the sale of gasoline that exceed certain RVP limits during the high ozone season (i.e., the summer months). However, current law provides waivers from this requirement, including a waiver that gives certain ethanol-gasoline fuel blends containing 10% denatured anhydrous ethanol a higher RVP limit under certain conditions. This bill expands the waiver to include ethanol-gasoline fuel blends containing more than 10% of such ethanol, thus allowing year-round sales of such fuel blends.

To provide regulatory relief to alternative fuel producers and 
                   consumers, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fuel Choice and Deregulation Act of 
2021''.

SEC. 2. ALTERNATIVE FUELS.

    (a) Aftermarket Conversions of Motor Vehicles to Alternative 
Fuel.--Section 203 of the Clean Air Act (42 U.S.C. 7522) is amended by 
adding at the end the following:
    ``(c) Older Vehicles.--
            ``(1) In general.--The aftermarket conversion of a motor 
        vehicle to alternative fuel operation shall not--
                    ``(A) be considered tampering under this section if 
                the aftermarket conversion system manufacturer or the 
                person performing the conversion demonstrates that the 
                development and engineering sophistication of the 
                conversion technology is--
                            ``(i) matched to an appropriate motor 
                        vehicle or group of motor vehicles; and
                            ``(ii) well-designed and installed in 
                        accordance with good engineering judgment so 
                        that the aftermarket conversion system does not 
                        degrade emission performance, as compared to 
                        the performance of the motor vehicle or motor 
                        vehicles before the conversion; or
                    ``(B) require the Administrator to issue a 
                certificate of conformity.
            ``(2) Label.--The person performing a conversion described 
        in paragraph (1) shall affix a label to the motor vehicle 
        stating that--
                    ``(A) the motor vehicle has been equipped with an 
                aftermarket conversion system; and
                    ``(B) the installation of that system occurred 
                after the initial sale of the motor vehicle.
            ``(3) No preclusion of orders.--Nothing in this subsection 
        precludes the Administrator from issuing an order to prohibit 
        the manufacture, sale, distribution, or installation of an 
        aftermarket conversion system if the Administrator has evidence 
        that the installation of the aftermarket conversion system on a 
        motor vehicle degrades emission performance.''.
    (b) Biomass Fuels.--Section 211 of the Clean Air Act (42 U.S.C. 
7545) is amended by adding at the end the following:
    ``(w) Biomass Fuels.--Notwithstanding any other provision of this 
Act, the Administrator may not prohibit or control biomass fuel (as 
defined in section 203 of the Biomass Energy and Alcohol Fuels Act of 
1980 (42 U.S.C. 8802)) under this Act.''.

SEC. 3. CALCULATION OF AVERAGE FUEL ECONOMY.

    (a) Definitions.--Section 32901(a) of title 49, United States Code, 
is amended--
            (1) by redesignating paragraphs (7) through (19) as 
        paragraphs (8), (9), (10), (13), (16), (17), (19), (20), (21), 
        (22), (23), (24), and (26), respectively;
            (2) by inserting after paragraph (6) the following:
            ``(7) `biodiesel'--
                    ``(A) means liquid fuel derived from biomass that 
                meets--
                            ``(i) the registration requirements for 
                        fuels and fuel additives established by the 
                        Environmental Protection Agency under section 
                        211 of the Clean Air Act (42 U.S.C. 7545); and
                            ``(ii) the requirements of the American 
                        Society of Testing Materials Standard D6751; 
                        and
                    ``(B) does not include any liquid with respect to 
                which a credit may be determined under section 40 of 
                the Internal Revenue Code of 1986.'';
            (3) by inserting after paragraph (10) (as so redesignated) 
        the following:
            ``(11) `E85' means a fuel mixture that--
                    ``(A) contains between 51 and 83 percent ethanol; 
                and
                    ``(B) meets the specifications of the American 
                Society of Testing Materials Standard D5798.
            ``(12) `flexible fuel vehicle' means a vehicle that has 
        been warranted to operate on gasoline, E85, and M85.'';
            (4) by inserting after paragraph (13) (as so redesignated) 
        the following:
            ``(14) `fuel choice enabling manufacturer' means a 
        manufacturer whose total fleet of automobiles manufactured for 
        the most recent model year for sale in the United States 
        contains not less than 50 percent fuel choice enabling 
        vehicles.
            ``(15) `fuel choice enabling vehicle' means an automobile 
        that--
                    ``(A) has been warranted to operate on natural gas, 
                hydrogen, propane, or at least 20 percent biodiesel;
                    ``(B) is a flexible fuel vehicle;
                    ``(C) is a plug-in electric drive vehicle;
                    ``(D) is propelled by a fuel cell that can produce 
                power without the use of petroleum or a petroleum-based 
                fuel; or
                    ``(E)(i) is propelled by something other than an 
                internal combustion engine; and
                    ``(ii) is warranted to operate on something other 
                than petroleum-based fuel.'';
            (5) by inserting after paragraph (17) (as so redesignated) 
        the following:
            ``(18) `M85' means a fuel mixture that--
                    ``(A) contains up to 85 percent methanol; and
                    ``(B) meets the specifications of the American 
                Society of Testing Materials International Standard 
                D5797.''; and
            (6) by inserting after paragraph (24) (as so redesignated) 
        the following:
            ``(25) `plug-in electric drive vehicle' has the meaning 
        given the term in section 508(a) of the Energy Policy Act of 
        1992 (42 U.S.C. 13258(a)).''.
    (b) Fuel Choice Enabling Manufacturers.--
            (1) Compliance with the clean air act.--Section 32902 of 
        title 49, United States Code, is amended by adding at the end 
        the following:
    ``(l) Deemed Compliance With the Clean Air Act.--If a fuel choice 
enabling manufacturer is in compliance with all applicable standards 
prescribed under this section for model year 2020 or any subsequent 
model year, the automobiles manufactured by that manufacturer in that 
model year are deemed to be in compliance with all applicable 
greenhouse gas regulations established by the Environmental Protection 
Agency pursuant to section 202 of the Clean Air Act (42 U.S.C. 
7521).''.
            (2) Credits for exceeding standards.--Section 32903(a) of 
        title 49, United States Code, is amended by striking paragraph 
        (2) and inserting the following:
            ``(2) any of the 5 consecutive model years immediately 
        after the model year for which the credits are earned, to the 
        extent that those credits are not used under paragraph (1).''.
            (3) Average fuel economy bonus for fuel choice enabling 
        manufacturers.--Section 32904 of title 49, United States Code, 
        is amended--
                    (A) by redesignating subsections (d) and (e) as 
                subsections (e) and (f), respectively; and
                    (B) by inserting after subsection (c) the 
                following:
    ``(d) Average Fuel Economy Bonus for Fuel Choice Enabling 
Manufacturers.--The average fuel economy of a fuel choice enabling 
manufacturer for a model year is the sum of--
            ``(1) the average fuel economy of the fuel choice enabling 
        manufacturer for that model year, as otherwise calculated under 
        this section; and
            ``(2) 8 miles per gallon.''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to automobiles manufactured for model year 2022 or 
for any subsequent model year.

SEC. 4. ETHANOL WAIVER.

    Section 211(h)(4) of the Clean Air Act (42 U.S.C. 7545(h)(4)) is 
amended--
            (1) in the matter preceding subparagraph (A), by inserting 
        ``or more of'' after ``10 percent''; and
            (2) in subparagraph (C), by striking ``additional alcohol 
        or''.
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