II 114th CONGRESS 1st Session S. 889 IN THE SENATE OF THE UNITED STATES March 26, 2015 Mr. Paul (for himself and Mr. Grassley ) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To provide regulatory relief to alternative fuel producers and consumers, and for other purposes.

1. Short title This Act may be cited as the Fuel Choice and Deregulation Act of 2015 . 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 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 is able to demonstrate that the development and engineering sophistication of the conversion technology is— (i) matched to an appropriate vehicle or group of 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 vehicle or vehicles before the conversion; or (B) require the issuance by the Administrator of any 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 vehicle has been equipped with an aftermarket conversion system; and (B) the installation of that system occurred after the initial sale of the vehicle. (3) No preclusion of orders Nothing in this subsection may be construed to preclude 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 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. . 3. Calculation of average fuel economy (a) Definitions Section 32901(a) of title 49, United States Code, is amended— (1) by redesignating paragraphs (13) through (19) as paragraphs (19) through (25); (2) by redesignating paragraphs (11) and (12) as paragraphs (16) and (17), respectively; (3) by redesignating paragraph (10) as paragraph (13); (4) by redesignating paragraphs (7), (8), and (9) as paragraphs (8), (9), and (10), respectively; (5) 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 ASTM 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. ; (6) by inserting after paragraph (10), as 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 ASTM Standard D5798.; (12) flexible fuel vehicle means a vehicle that has been warranted to operate on gasoline, E85, and M85. ; (7) by inserting after paragraph (13), as 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 at least 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. ; (8) by inserting after paragraph (17), as redesignated, the following: (18) M85 means a fuel mixture that— (A) contains up to 85 percent methanol; and (B) meets the specifications of the ASTM International Standard D5797. ; and (9) by inserting after paragraph (25), as redesignated, the following: (26) plug-in electric drive vehicle has the meaning given such term in section 508(a) of the Energy Policy Act of 1992 ( 42 U.S.C. 13258(a) ). . (b) Fuel choice enabling manufacturers Chapter 329 of title 49, United States Code, is amended— (1) in section 32902, 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 2016 or any subsequent model year, the automobiles manufactured by such manufacturer in such 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) in section 32903(a), by amending paragraph (2) to read as follows: (2) any of the 5 consecutive model years immediately after the model year for which the credits are earned, to the extent that such credits are not used under paragraph (1); ; and (3) in section 32904— (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 such manufacturer for such model year, as otherwise calculated pursuant to 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 2016 or for any subsequent model year. 4. Equalization of excise tax on liquefied natural gas and per energy equivalent of diesel (a) In general Section 4041(a)(2) of the Internal Revenue Code of 1986 is amended— (1) in subparagraph (B)— (A) in clause (i), by striking and at the end; (B) in clause (ii)— (i) by striking liquefied natural gas, ; (ii) by striking peat), and and inserting peat) and ; and (iii) by striking the period at the end and inserting , and ; and (C) by adding at the end the following new clause: (iii) in the case of liquefied natural gas, 24.3 cents per energy equivalent of a gallon of diesel. ; and (2) by adding at the end the following: (C) Energy equivalent of a gallon of diesel For purposes of this paragraph, the term energy equivalent of a gallon of diesel means, with respect to a liquefied natural gas fuel, the amount of such fuel having a Btu content of 128,700 (lower heating value). (D) Administrative provisions For purposes of applying this title with respect to the taxes imposed by this subsection, references to any liquid subject to tax under this subsection shall be treated as including references to liquefied natural gas subject to tax under this paragraph. . (b) Effective date The amendments made by this section shall apply to any sale or use of liquefied natural gas after the date that is 14 days after the date of the enactment of this Act. 5. 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 after 10 percent ; and (2) in subparagraph (C), by striking additional alcohol or .