Title: Master Limited Partnerships Parity Act
Policy area: Taxation

Summary:
Master Limited Partnerships Parity Act
This bill amends the Internal Revenue Code, with respect to the tax treatment of publicly traded partnerships as corporations, to expand the definition of "qualifying income" for such partnerships (known as master limited partnerships) to include income and gains from renewable and alternative energy generation projects (in addition to fossil fuel-based energy generation projects) and related infrastructure for transportation or storage, including energy derived from thermal resources, waste, renewable fuels and chemicals, energy efficient buildings, gasification, and carbon capture in secure geological storage.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 2005 Introduced in Senate (IS)]

<DOC>






115th CONGRESS
  1st Session
                                S. 2005

   To amend the Internal Revenue Code of 1986 to extend the publicly 
   traded partnership ownership structure to energy power generation 
       projects and transportation fuels, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            October 25, 2017

   Mr. Coons (for himself, Mr. Moran, Ms. Stabenow, Mr. Gardner, Mr. 
    Bennet, Ms. Murkowski, Mr. King, Ms. Collins, and Mr. Heinrich) 
introduced the following bill; which was read twice and referred to the 
                          Committee on Finance

_______________________________________________________________________

                                 A BILL


 
   To amend the Internal Revenue Code of 1986 to extend the publicly 
   traded partnership ownership structure to energy power generation 
       projects and transportation fuels, 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 ``Master Limited Partnerships Parity 
Act''.

SEC. 2. EXTENSION OF PUBLICLY TRADED PARTNERSHIP OWNERSHIP STRUCTURE TO 
              ENERGY POWER GENERATION PROJECTS, TRANSPORTATION FUELS, 
              AND RELATED ENERGY ACTIVITIES.

    (a) In General.--Subparagraph (E) of section 7704(d)(1) of the 
Internal Revenue Code of 1986 is amended--
            (1) by striking ``income and gains derived from the 
        exploration'' and inserting ``income and gains derived from the 
        following:
                            ``(i) Minerals, natural resources, etc.--
                        The exploration'';
            (2) by inserting ``or'' before ``industrial source'';
            (3) by inserting a period after ``carbon dioxide''; and
            (4) by striking ``, or the transportation or storage'' and 
        all that follows and inserting the following:
                            ``(ii) Renewable energy.--The generation of 
                        electric power (including the leasing of 
                        tangible personal property used for such 
                        generation) exclusively utilizing any resource 
                        described in section 45(c)(1) or energy 
                        property described in section 48 (determined 
                        without regard to any termination date), or in 
                        the case of a facility described in paragraph 
                        (3) or (7) of section 45(d) (determined without 
                        regard to any placed in service date or date by 
                        which construction of the facility is required 
                        to begin), the accepting or processing of such 
                        resource.
                            ``(iii) Energy storage property.--The sale 
                        of electric power, capacity, resource adequacy, 
                        demand response capabilities, or ancillary 
                        services that is produced or made available 
                        from any equipment or facility (operating as a 
                        single unit or as an aggregation of units) the 
                        principal function of which is to--
                                    ``(I) use mechanical, chemical, 
                                electrochemical, hydroelectric, or 
                                thermal processes to store energy that 
                                was generated at one time for 
                                conversion to electricity at a later 
                                time, or
                                    ``(II) store thermal energy for 
                                direct use for heating or cooling at a 
                                later time in a manner that avoids the 
                                need to use electricity at that later 
                                time.
                            ``(iv) Combined heat and power.--The 
                        generation, storage, or distribution of thermal 
                        energy exclusively utilizing property described 
                        in section 48(c)(3) (determined without regard 
                        to subparagraphs (B) and (D) thereof and 
                        without regard to any placed in service date).
                            ``(v) Renewable thermal energy.--The 
                        generation, storage, or distribution of thermal 
                        energy exclusively using any resource described 
                        in section 45(c)(1) or energy property 
                        described in clause (i) or (iii) of section 
                        48(a)(3)(A).
                            ``(vi) Waste heat to power.--The use of 
                        recoverable waste energy, as defined in section 
                        371(5) of the Energy Policy and Conservation 
                        Act (42 U.S.C. 6341(5)) (as in effect on the 
                        date of the enactment of the Master Limited 
                        Partnerships Parity Act).
                            ``(vii) Renewable fuel infrastructure.--The 
                        storage or transportation of any fuel described 
                        in subsection (b), (c), (d), or (e) of section 
                        6426.
                            ``(viii) Renewable fuels.--The production, 
                        storage, or transportation of any renewable 
                        fuel described in section 211(o)(1)(J) of the 
                        Clean Air Act (42 U.S.C. 7545(o)(1)(J)) (as in 
                        effect on the date of the enactment of the 
                        Master Limited Partnerships Parity Act) or 
                        section 40A(d)(1).
                            ``(ix) Fuel derived from captured carbon 
                        dioxide.--The production, storage, or 
                        transportation of any fuel which--
                                    ``(I) uses carbon dioxide captured 
                                from an anthropogenic source or the 
                                atmosphere as its primary feedstock, 
                                and
                                    ``(II) is determined by the 
                                Secretary, in consultation with the 
                                Secretary of Energy and the 
                                Administrator of the Environmental 
                                Protection Agency, to achieve a 
                                reduction of not less than a 60 percent 
                                in lifecycle greenhouse gas emissions 
                                (as defined in section 211(o)(1)(H) of 
                                the Clean Air Act) compared to baseline 
                                lifecycle greenhouse gas emissions (as 
                                defined in section 211(o)(1)(C) of such 
                                Act).
                        This clause shall not apply to any fuel which 
                        uses as its primary feedstock carbon dioxide 
                        which is deliberately released from naturally-
                        occurring subsurface springs.
                            ``(x) Renewable chemicals.--The production, 
                        storage, or transportation of any qualifying 
                        renewable chemical (as defined in paragraph 
                        (6)).
                            ``(xi) Energy efficient buildings.--The 
                        audit and installation through contract or 
                        other agreement of any energy efficient 
                        building property described in section 
                        179D(c)(1).
                            ``(xii) Gasification with sequestration.--
                        The production of any product or the generation 
                        of electric power from a project--
                                    ``(I) which meets the requirements 
                                of subparagraphs (A) and (B) of section 
                                48B(c)(1), and
                                    ``(II) not less than 75 percent of 
                                the total carbon dioxide emissions of 
                                which is qualified carbon dioxide (as 
                                defined in section 45Q(b)) which is 
                                disposed of or utilized as provided in 
                                paragraph (7).
                            ``(xiii) Carbon capture and 
                        sequestration.--
                                    ``(I) Power generation 
                                facilities.--The generation or storage 
                                of electric power (including associated 
                                income from the sale or marketing of 
                                energy, capacity, resource adequacy, 
                                and ancillary services) produced from 
                                any power generation facility which is, 
                                or from any power generation unit 
                                within, a qualified facility which is 
                                described in section 45Q(c) and not 
                                less than 50 percent (30 percent in the 
                                case of a facility or unit placed in 
                                service before January 1, 2017) of the 
                                total carbon dioxide emissions of which 
                                is qualified carbon dioxide which is 
                                disposed of or utilized as provided in 
                                paragraph (7).
                                    ``(II) Other facilities.--The sale 
                                of any good or service from any 
                                facility (other than a power generation 
                                facility) which is a qualified facility 
                                described in section 45Q(c) and the 
                                captured qualified carbon dioxide (as 
                                so defined) of which is disposed of as 
                                provided in paragraph (7).''.
    (b) Renewable Chemical.--
            (1) In general.--Section 7704(d) of such Code is amended by 
        adding at the end the following new paragraph:
            ``(6) Qualifying renewable chemical.--
                    ``(A) In general.--The term `qualifying renewable 
                chemical' means any renewable chemical (as defined in 
                section 9001 of the Agriculture Act of 2014)--
                            ``(i) which is produced by the taxpayer in 
                        the United States or in a territory or 
                        possession of the United States,
                            ``(ii) which is the product of, or reliant 
                        upon, biological conversion, thermal 
                        conversion, or a combination of biological and 
                        thermal conversion, of renewable biomass (as 
                        defined in section 9001(13) of the Farm 
                        Security and Rural Investment Act of 2002),
                            ``(iii) the biobased content of which is 95 
                        percent or higher,
                            ``(iv) which is sold or used by the 
                        taxpayer--
                                    ``(I) for the production of 
                                chemical products, polymers, plastics, 
                                or formulated products, or
                                    ``(II) as chemicals, polymers, 
                                plastics, or formulated products,
                            ``(v) which is not sold or used for the 
                        production of any food, feed, or fuel, and
                            ``(vi) which is--
                                    ``(I) acetic acid, acrylic acid, 
                                acyl glutamate, adipic acid, algae 
                                oils, algae sugars, 1,4-butanediol 
                                (BDO), iso-butanol, n-butanol, C10 and 
                                higher hydrocarbons produced from 
                                olefin metathesis, carboxylic acids 
                                produced from olefin metathesis, 
                                cellulosic sugar, diethyl methylene 
                                malonate, dodecanedioic acid (DDDA), 
                                esters produced from olefin metathesis, 
                                ethyl acetate, ethylene glycol, 
                                farnesene, 2,5-furandicarboxylic acid, 
                                gamma-butyrolactone, glucaric acid, 
                                hexamethylenediamine (HMD), 3-hydroxy 
                                propionic acid, iso-butene, isoprene, 
                                itaconic acid, lactide, levulinic acid, 
                                polyhydroxyalkonate (PHA), polylactic 
                                acid (PLA), polyethylene furanoate 
                                (PEF), polyethylene terephthalate 
                                (PET), polyitaconic acid, polyols from 
                                vegetable oils, poly(xylitan levulinate 
                                ketal), 1,3-propanediol, 1,2-
                                propanediol, rhamnolipids, short and 
                                medium chain carboxylic acids produced 
                                from anaerobic digestion, succinic 
                                acid, terephthalic acid, vegetable 
                                fatty acid derived from ethyl esters 
                                containing vegetable oil, or p-Xylene, 
                                or
                                    ``(II) any chemical not described 
                                in clause (i) which is a chemical 
                                listed by the Secretary for purposes of 
                                this paragraph.
                    ``(B) Biobased content.--For purposes of 
                subparagraph (A)(iii), the term `biobased content 
                percentage' means, with respect to any renewable 
                chemical, the biobased content of such chemical 
                (expressed as a percentage) determined by testing 
                representative samples using the American Society for 
                Testing and Materials (ASTM) D6866.''.
            (2) List of other qualifying renewable chemicals.--Not 
        later than 180 days after the date of the enactment of this 
        Act, the Secretary of the Treasury (or the Secretary's 
        delegate), in consultation with the Secretary of Agriculture, 
        shall establish a program to consider applications from 
        taxpayers for the listing of chemicals under section 
        7874(d)(6)(A)(vi)(II) (as added by paragraph (1)).
    (c) Disposal and Utilization of Captured Carbon Dioxide.--Section 
7704(d) of such Code, as amended by subsection (b), is amended by 
adding at the end the following new paragraph:
            ``(7) Disposal and utilization of captured carbon 
        dioxide.--For purposes of clauses (xii)(III) and (xiii)(I) of 
        paragraph (1)(E), carbon dioxide is disposed of or utilized as 
        provided in this paragraph if such carbon dioxide is--
                    ``(A) placed into secure geological storage (as 
                determined under section 45Q(d)(2)),
                    ``(B) used as a tertiary injectant (as defined in 
                section 45Q(d)(3)) in a qualified enhanced oil or 
                natural gas recovery project (as defined in section 
                45Q(d)(4)) and placed into secure geological storage 
                (as so determined),
                    ``(C) fixated through photosynthesis or 
                chemosynthesis (such as through the growing of algae or 
                bacteria),
                    ``(D) chemically converted to a material or 
                chemical compound in which it is securely stored, or
                    ``(E) used for any other purpose which the 
                Secretary determines has the potential to strengthen or 
                significantly develop a competitive market for carbon 
                dioxide captured from man-made sources.''.
    (d) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act, in taxable years 
ending after such date.
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