S 2904 IS
106th CONGRESS
2d Session
S. 2904
To amend the Internal Revenue Code of 1986 to provide tax incentives
to encourage the production and use of efficient energy sources, and for other
purposes.
IN THE SENATE OF THE UNITED STATES
July 21, 2000
Mr. BINGAMAN (for himself, Mr. DASCHLE, Mr. BAUCUS, Mr. BYRD, Mr. BAYH, Mr.
LEVIN, Mr. ROCKEFELLER, and Mr. JOHNSON) 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 provide tax incentives
to encourage the production and use of efficient energy sources, 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; AMENDMENT OF 1986 CODE; TABLE OF CONTENTS.
(a) SHORT TITLE- This Act may be cited as the `Energy Security Tax and
Policy Act of 2000'.
(b) Amendment of 1986 Code- Except as otherwise expressly provided,
whenever in this Act an amendment or repeal is expressed in terms of an
amendment to, or repeal of, a section or other provision, the reference shall
be considered to be made to a section or other provision of the Internal
Revenue Code of 1986.
(c) TABLE OF CONTENTS- The table of contents for this Act is as
follows:
Sec. 1. Short title; amendment of 1986 Code; table of contents.
TITLE I--ENERGY-EFFICIENT PROPERTY USED IN BUSINESS
Sec. 101. Incentive for Distributed Generation.
Sec. 102. Credit for energy-efficient property used in business,
including hybrid vehicles.
Sec. 103. Energy Efficient Commercial Building Property Deduction.
TITLE II--NONBUSINESS ENERGY SYSTEMS
Sec. 201. Credit for certain nonbusiness energy systems.
TITLE III--ALTERNATIVE FUELS
Sec. 301. Allocation of alcohol fuels credit to patrons of a
cooperative.
TITLE IV--AUTOMOBILES
Sec. 401. Extension of credit for qualified electric vehicles.
Sec. 402. Additional Deduction for Cost of Installation of Alternative
Fueling Stations.
Sec. 403. Credit for Retail Sale of Clean Burning Fuels as Motor Vehicle
Fuel.
Sec. 404. Exception to HOV Passenger Requirements for Alternative Fuel
Vehicles.
TITLE V--CLEAN COAL TECHNOLOGIES
Sec. 501. Credit for investment in qualifying clean coal
technology.
Sec. 502. Credit for production from qualifying clean coal
technology.
Sec. 503. Risk pool for qualifying clean coal technology.
TITLE VI--METHANE RECOVERY
Sec. 601. Credit for capture of coalmine methane gas.
TITLE VII--OIL AND GAS PRODUCTION
Sec. 701. Credit for production of re-refined lubricating oil.
Sec. 702. Oil and gas from marginal wells.
Sec. 703. Deduction for delay rental payments.
Sec. 704. Election to expense geological and geophysical
expenditures.
TITLE VIII--RENEWABLE POWER GENERATION
Sec. 801. Modifications to credit for electricity produced from
renewable resources.
Sec. 802. Credit for capital costs of qualified biomass-based generating
system.
Sec. 803. Treatment of facilities using bagasse to produce energy as
solid waste disposal facilities eligible for tax-exempt financing.
Sec. 804. Federal renewable portfolio standard.
TITLE IX--STEELMAKING
Sec. 901. Extension of credit for electricity to production from steel
cogeneration.
TITLE X--ENERGY EMERGENCIES
Sec. 1001. Energy Policy and Conservation Act Amendments.
Sec. 1002. Energy Conservation Programs for Schools and Hospitals.
Sec. 1003. State Energy Programs.
Sec. 1004. Annual Home Heating Readiness.
Sec. 1005. Summer Fill and Fuel Budgeting Programs.
Sec. 1006. Use of Energy Futures for Fuel Purchases.
Sec. 1007. Increased Use of Alternative Fuels by Federal Fleets.
Sec. 1008. Full Expensing of Home Heating Oil and Propane Storage
Facilities.
TITLE XI--ENERGY EFFICIENCY
Sec. 1101. Energy Savings Performance Contracts.
Sec. 1102. Weatherization.
Sec. 1103. Public Benefits System.
Sec. 1104. National Oil Heat Research Alliance Act.
TITLE XII--ELECTRICITY
Sec. 1201. Comprehensive Indian Energy Program.
Sec. 1202. Interconnection.
TITLE I--ENERGY-EFFICIENT PROPERTY USED IN BUSINESS
SEC. 101. INCENTIVE FOR DISTRIBUTED GENERATION.
(a) IN GENERAL- Section 168(e)(3)(E) of the Internal Revenue Code
(classifying certain property as 15-year property) is amended by striking
`and' at the end of clause (ii), striking the period at the end of clause
(iii) and inserting `, and', and by adding the following new clause:
`(iv) any distributed power property.'.
(b) CONFORMING AMENDMENTS- (1) Section 168(i) is amended by adding at the
end the
following new paragraph:
`(15) DISTRIBUTED POWER PROPERTY- The term `distributed power property'
means property--
`(A) which is used in the generation of electricity for primary
use--
`(i) in nonresidential real or residential rental property used in
the taxpayer's trade or business, or
`(ii) in the taxpayer's industrial manufacturing process or plant
activity, with a rated total capacity in excess of 500
kilowatts,
`(B) which also may produce usable thermal energy or mechanical power
for use in a heating or cooling application, as long as at least 40
percent of the total useful energy produced consists of--
`(i) with respect to assets described in subparagraph (A)(i),
electrical power (whether sold or used by the taxpayer), or
`(ii) with respect to assets described in subparagraph (A)(ii),
electrical power (whether sold or used by the taxpayer) and thermal or
mechanical energy used in the taxpayer's industrial manufacturing
process or plant activity,
`(C) which is not used to transport primary fuel to the generating
facility or to distribute energy within or outside of the facility,
and
`(D) where it is reasonably expected that not more than 50 percent of
the produced electricity will be sold to, or used by, unrelated
persons.
For purposes of subparagraph (B), energy output is determined on the
basis of expected annual output levels, measured in British thermal units
(Btu), using standard conversion factors established by the
Secretary.'.
(2) Subparagraph (B) of section 168(g)(3) is amended by inserting after
the item relating to subparagraph (E)(iii) in the table contained therein the
following new line:
(c) EFFECTIVE DATE- The amendments made by this section are effective for
property placed in service on or after December 31, 2000.
SEC. 102. CREDIT FOR CERTAIN ENERGY-EFFICIENT PROPERTY USED IN
BUSINESS.
(a) IN GENERAL- Subpart E of part IV of subchapter A of chapter 1
(relating to rules for computing investment credit) is amended by inserting
after section 48 the following:
`SEC. 48A. ENERGY CREDIT.
`(a) IN GENERAL- For purposes of section 46, the energy credit for any
taxable year is the sum of--
`(1) the amount equal to the energy percentage of the basis of each
energy property placed in service during such taxable year, and
`(2) the credit amount for each qualified hybrid vehicle placed in
service during the taxable year.
`(1) IN GENERAL- The energy percentage is--
`(A) except as otherwise provided in this subparagraph, 10
percent,
`(B) in the case of energy property described in clauses (i), (iii),
(vi), and (vii) of subsection (c)(1)(A), 20 percent,
`(C) in the case of energy property described in subsection
(c)(1)(A)(v), 15 percent, and
`(D) in the case of energy property described in subsection
(c)(1)(A)(ii) relating to a high risk geothermal well, 20
percent.
`(2) COORDINATION WITH REHABILITATION- The energy percentage shall not
apply to that portion of the basis of any property which is attributable to
qualified rehabilitation expenditures.
`(c) Energy Property Defined-
`(1) IN GENERAL- For purposes of this subpart, the term `energy
property' means any property--
`(i) solar energy property,
`(ii) geothermal energy property,
`(iii) energy-efficient building property,
`(iv) combined heat and power system property,
`(v) low core loss distribution transformer property,
`(vi) qualified anaerobic digester property, or
`(vii) qualified wind energy systems equipment property,
`(B)(i) the construction, reconstruction, or erection of which is
completed by the taxpayer, or
`(ii) which is acquired by the taxpayer if the original use of such
property commences with the taxpayer.
`(C) which can reasonably be expected to remain in operation for at
least 5 years,
`(D) with respect to which depreciation (or amortization in lieu of
depreciation) is allowable, and
`(E) which meets the performance and quality standards (if any)
which--
`(i) have been prescribed by the Secretary by regulations (after
consultation with the Secretary of Energy), and
`(ii) are in effect at the time of the acquisition of the
property.
`(A) PUBLIC UTILITY PROPERTY- Such term shall not include any property
which is public utility property (as defined in section 46(f)(5) as in
effect on the day before the date of the enactment of the Revenue
Reconciliation Act of 1990), except for property described in paragraph
(1)(A)(iv).
`(B) CERTAIN WIND EQUIPMENT- Such term shall not include equipment
described in paragraph (1)(A)(vii) which is taken into account for
purposes of section 45 for the taxable year.
`(d) DEFINITIONS RELATING TO TYPES OF ENERGY PROPERTY- For purposes of
this section--
`(1) Solar energy property-
`(A) IN GENERAL- The term `solar energy property' means equipment
which uses solar energy to generate electricity, to heat or cool (or
provide hot water for use in) a structure, or to provide solar process
heat.
`(B) SWIMMING POOLS, ETC. USED AS STORAGE MEDIUM- The term `solar
energy property' shall not include property with respect to which
expenditures are properly allocable to a swimming pool, hot tub, or any
other energy storage medium which has a function other than the function
of such storage.
`(C) SOLAR PANELS- No solar panel or other property installed as a
roof (or
portion thereof) shall fail to be treated as solar energy property solely
because it constitutes a structural component of the structure on which it is
installed.
`(2) Geothermal energy property-
`(A) IN GENERAL- The term `geothermal energy property' means equipment
used to produce, distribute, or use energy derived from a geothermal
deposit (within the meaning of section 613(e)(2)), but only, in the case
of electricity generated by geothermal power, up to (but not including)
the electrical transmission stage.
`(B) HIGH RISK GEOTHERMAL WELL- The term `high risk geothermal well'
means a geothermal deposit (within the meaning of section 613(e)(2)) which
requires high risk drilling techniques. Such deposit may not be located in
a State or national park or in an area in which the relevant State park
authority or the National Park Service determines the development of such
a deposit will negatively impact on a State or national park.
`(3) Energy-efficient building property-
`(A) IN GENERAL- The term `energy-efficient building property'
means--
`(I) generates electricity and heat using an electrochemical
process,
`(II) has an electricity-only generation efficiency greater than
35 percent, and
`(III) has a minimum generating capacity of 5
kilowatts,
`(ii) an electric heat pump hot water heater that yields an energy
factor of 1.7 or greater under standards prescribed by the Secretary of
Energy,
`(iii) an electric heat pump that has a heating system performance
factor (HSPF) of 9 or greater and a cooling seasonal energy efficiency
ratio (SEER) of 13.5 or greater,
`(iv) a natural gas heat pump that has a coefficient of performance
of not less than 1.25 for heating and not less than 0.60 for
cooling,
`(v) a central air conditioner that has a cooling seasonal energy
efficiency ratio (SEER) of 13.5 or greater,
`(vi) an advanced natural gas water heater that--
`(I) increases steady state efficiency and reduces standby and
vent losses, and
`(II) has an energy factor of at least 0.65,
`(vii) an advanced natural gas furnace that achieves a 95 percent
AFUE, and
`(viii) natural gas cooling equipment--
`(I) that has a coefficient of performance of not less than .60,
or
`(II) that uses desiccant technology and has an efficiency rating
of 40 percent.
`(B) LIMITATIONS- The credit under subsection (a)(1) for the taxable
year may not exceed--
`(i) $500 in the case of property described in subparagraph (A)
other than clauses (i) and (iv) thereof,
`(ii) $500 for each kilowatt of capacity in the case of a fuel cell
described in subparagraph (A)(i), and
`(iii) $1,000 in the case of a natural gas heat pump described in
subparagraph (A)(iv).
`(4) Combined heat and power system property-
`(A) IN GENERAL- The term `combined heat and power system property'
means property--
`(i) comprising a system for the same energy source for the
simultaneous or sequential generation of electrical power, mechanical
shaft power, or both, in combination with steam, heat, or other forms of
useful energy,
`(ii) that has an electrical capacity of more than 50 kilowatts or a
mechanical energy capacity of more than 67 horsepower or an equivalent
combination of electrical and mechanical energy capacities,
and
`(iii) that produces at least 20 percent of its total useful energy
in the form of both thermal energy and electrical or mechanical
power.
`(B) ACCOUNTING RULE FOR PUBLIC UTILITY PROPERTY- In the case that
combined heat and power system property is public utility property (as
defined in section 46(f)(5) as in effect on the day before the date of the
enactment of the Revenue Reconciliation Act of 1990), the taxpayer may
only claim the credit under subsection (a)(1) if, with respect to such
property, the taxpayer uses a normalization method of accounting.
`(5) LOW CORE LOSS DISTRIBUTION TRANSFORMER PROPERTY- The term `low core
loss distribution transformer property' means a distribution transformer
which has energy savings from a highly efficient core of at least 20 percent
more than the average for power ratings reported by studies required under
section 124 of the Energy Policy Act of 1992.
`(6) QUALIFIED ANAEROBIC DIGESTER PROPERTY- The term `qualified
anaerobic digester property' means an anaerobic digester for manure or crop
waste that achieves at least 65 percent efficiency measured in terms of the
fraction of energy input converted to electricity and useful thermal
energy.
`(7) QUALIFIED WIND ENERGY SYSTEMS EQUIPMENT PROPERTY- The term
`qualified wind energy systems equipment property' means wind energy systems
equipment with a turbine size of not more than 50 kilowatts rated
capacity.
`(e) QUALIFIED HYBRID VEHICLES- For purposes of subsection (a)(2)--
`(A) IN GENERAL- The credit amount for each qualified hybrid vehicle
with a rechargeable energy storage system that provides the applicable
percentage of the maximum available power shall be the amount specified in
the following table:
------------------------------------------------------------------------------------------------------------------
`Applicable percentage greater than or equal to-- (Percent) Less than-- (Percent) Credit amount is:
------------------------------------------------------------------------------------------------------------------
5 10 $500
10 20 1,000
20 30 1,500
30 2,000
------------------------------------------------------------------------------------------------------------------
`(B) INCREASE IN CREDIT AMOUNT FOR REGENERATIVE BRAKING SYSTEM- In the
case of a qualified hybrid vehicle that actively employs a regenerative
braking system which supplies to the rechargeable energy storage system
the applicable percentage of the energy available from braking in a
typical 60 miles per hour to 0 miles per hour braking event, the credit
amount determined under subparagraph (A) shall be increased by the amount
specified in the following table:
---------------------------------------------------------------------------------------------------------------------------
`Applicable percentage greater than or equal to-- (Percent) Less than-- (Percent) Credit amount increase is:
---------------------------------------------------------------------------------------------------------------------------
20 40 $250
40 60 500
60 1,000
---------------------------------------------------------------------------------------------------------------------------
`(2) QUALIFIED HYBRID VEHICLE- The term `qualified hybrid vehicle' means
an
automobile that meets all regulatory requirements applicable to
gasoline-powered automobiles and that can draw propulsion energy from both of
the following on-board sources of stored energy:
`(B) A rechargeable energy storage system, provided that the
automobile is at least 33% more efficient than the average vehicle in its
vehicle characterization as defined by EPA.
`(3) MAXIMUM AVAILABLE POWER- The term `maximum available power' means
the maximum value of the sum of the heat engine and electric drive system
power or other non-heat energy conversion devices available for a driver's
command for maximum acceleration at vehicle speeds under 75 miles per
hour.
`(4) AUTOMOBILE- The term `automobile' has the meaning given such term
by section 4064(b)(1) (without regard to subparagraphs (B) and (C) thereof).
A vehicle shall not fail to be treated as an automobile solely by reason of
weight if such vehicle is rated at 8,500 pounds gross vehicle weight rating
or less.
`(5) DOUBLE BENEFIT; PROPERTY USED OUTSIDE UNITED STATES, ETC., NOT
QUALIFIED- No credit shall be allowed under subsection (a)(2) with respect
to--
`(A) any property for which a credit is allowed under section 25B or
30,
`(B) any property referred to in section 50(b), and
`(C) the portion of the cost of any property taken into account under
section 179 or 179A.
`(A) TREASURY- The Secretary shall prescribe such regulations as may
be necessary or appropriate to carry out the purposes of this
subsection.
`(B) ENVIRONMENTAL PROTECTION AGENCY- The Administrator of the
Environmental Protection Agency shall prescribe such regulations as may be
necessary or appropriate to specify the testing and calculation procedures
that would be used to determine whether a vehicle meets the qualifications
for a credit under this subsection.
`(7) TERMINATION- Paragraph (2) shall not apply with respect to any
vehicle placed in service during a calendar year ending before January 1,
2003, or after December 31, 2006.
`(f) SPECIAL RULES- For purposes of this section--
`(1) SPECIAL RULE FOR PROPERTY FINANCED BY SUBSIDIZED ENERGY FINANCING
OR INDUSTRIAL DEVELOPMENT BONDS-
`(A) REDUCATION OF BASIS- For purposes of applying the energy
percentage to any property, if such property is financed in whole or in
part by--
`(i) subsidized energy financing, or
`(ii) the proceeds of a private activity bond (within the meaning of
section 141) the interest on which is exempt from tax under section 103,
the amount taken into account as the basis of such property shall not
exceed the amount which (but for this subparagraph) would be so taken
into account multiplied by the fraction determined under subparagraph
(B).
`(B) DETERMINATION OF FRACTION- For purposes of subparagraph (A), the
fraction determined under this subparagraph is 1 reduced by a
fraction--
`(i) the numerator of which is that portion of the basis of the
property which is allocable to such financing or proceeds,
and
`(ii) the denominator of which is the basis of the
property.
`(C) SUBSIDIZED ENERGY FINANCING- For purposes of subparagraph (A),
the term `subsidized energy financing' means financing provided under a
Federal, State, or local program a principal purpose of which is to
provide subsidized financing for projects designed to conserve or produce
energy.
`(2) CERTAIN PROGRESS EXPENDITURE RULES MADE APPLICABLE- Rules similar
to the rules of subsections (c)(4) and (d) of section 46 (as in effect on
the day before the date of the enactment of the Revenue Reconciliation Act
of 1990) shall apply for purposes of this section.
`(g) APPLICATION OF SECTION-
`(1) IN GENERAL- Except as provided by paragraph (2) and subsection (e),
this section shall apply to property placed in service after December 31,
2000, and before January 1, 2004.
`(A) SOLAR ENERGY AND GEOTHERMAL ENERGY PROPERTY- Paragraph (1) shall
not apply to solar energy property or geothermal energy property.
`(B) FUEL CELL PROPERTY- In the case of property that is a fuel cell
described in subsection (d)(3)(A)(i), this section shall apply to property
placed in service after December 31, 2000, and before January 1,
2005.'
(b) Conforming Amendments-
(1) Section 48 is amended to read as follows:
`SEC. 48. REFORESTATION CREDIT.
`(a) IN GENERAL- For purposes of section 46, the reforestation credit for
any taxable year is 20 percent of the portion of the amortizable basis of any
qualified timber property which was acquired during such taxable year and
which is taken into account under section 194 (after the application of
section 194(b)(1)).
`(b) DEFINITIONS- For purposes of this subpart, the terms `amortizable
basis' and `qualified timber property' have the respective meanings given to
such terms by section 194.'
(2) Section 39(d) is amended by adding at the end the following:
`(9) NO CARRYBACK OF ENERGY CREDIT BEFORE EFFECTIVE DATE- No portion of
the unused business credit for any taxable year which is attributable to the
energy credit determined under section 48A may be carried back to a taxable
year ending before the date of the enactment of section 48A.'
(3) Section 280C is amended by adding at the end the following:
`(d) Credit for Energy Property Expenses-
`(1) IN GENERAL- No deduction shall be allowed for that portion of the
expenses for energy property (as defined in section 48A(c)) otherwise
allowable as a deduction for the taxable year which is equal to the amount
of the credit determined for such taxable year under section 48A(a).
`(2) SIMILAR RULE WHERE TAXPAYER CAPITALIZES RATHER THAN DEDUCTS
EXPENSES- If--
`(A) the amount of the credit allowable for the taxable year under
section 48A (determined without regard to section 38(c)), exceeds
`(B) the amount allowable as a deduction for the taxable year for
expenses for energy property (determined without regard to paragraph (1)),
the amount chargeable to capital account for the taxable year for such
expenses shall be reduced by the amount of such excess.
`(3) CONTROLLED GROUPS- Paragraph (3) of subsection (b) shall apply for
purposes of this subsection.'
(4) Section 29(b)(3)(A)(i)(III) is amended by striking `section
48(a)(4)(C)' and inserting `section 48A(f)(1)(C)'.
(5) Section 50(a)(2)(E) is amended by striking `section 48(a)(5)' and
inserting `section 48A(f)(2)'.
(6) Section 168(e)(3)(B) is amended--
(A) by striking clause (vi)(I) and inserting the following:
`(I) is described in paragraph (1) or (2) of section 48A(d) (or
would be so described if `solar and wind' were substituted for `solar'
in paragraph (1)(B)),', and
(B) in the last sentence by striking `section 48(a)(3)' and inserting
`section 48A(c)(2)(A)'.
(c) CLERICAL AMENDMENT- The table of sections for subpart E of part IV of
subchapter A of chapter 1 is amended by striking the item relating to section
48 and inserting the following:
`Sec. 48. Reforestation credit.
`Sec. 48A. Energy credit.'
(d) EFFECTIVE DATE- The amendments made by this section shall apply to
property placed in service after December 31, 2000, 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 Reconciliation Act of
1990).
SEC. 103. ENERGY EFFICIENT COMMERCIAL BUILDING PROPERTY DEDUCTION.
`(a) IN GENERAL- There shall be allowed as a deduction for the taxable
year an amount equal to the sum of the energy efficient commercial building
amount determined under subsection (b).
`(b)(1) DEDUCTION ALLOWED- For purposes of subsection (a)--
`(A) IN GENERAL- The energy efficient commercial building property
deduction determined under this subsection is an amount equal to energy
efficient commercial building property expenditures made by a taxpayer for
the taxable year.
`(B) MAXIMUM AMOUNT OF DEDUCTION- The amount of energy efficient
commercial building property expenditures taken into account under
subparagraph (A) shall not exceed an amount equal to the product of--
`(ii) the square footage of the building with respect to which the
expenditures are made.
`(C) YEAR DEDUCTION ALLOWED- The deduction under subparagraph (A) shall
be allowed in the taxable year in which the construction of the building is
completed.
`(2) ENERGY EFFICIENT COMMERCIAL BUILDING PROPERTY EXPENDITURES- For
purposes of this subsection, the term `energy efficient commercial building
property expenditures' means an amount paid or incurred for energy efficient
commercial building property installed on or in connection with new
construction or reconstruction of property--
`(A) for which depreciation is allowable under section 167,
`(B) which is located in the United States, and
`(C) the construction or erection of which is completed by the
taxpayer.
Such property includes all residential rental property, including low-rise
multifamily structures and single family housing property which is not within
the scope of Standard 90.1-1999 (described in paragraph (3)). Such term
includes expenditures for labor costs properly allocable to the onsite
preparation, assembly, or original installation of the property.
`(3) ENERGY EFFICIENT COMMERCIAL BUILDING PROPERTY- For purposes of
paragraph (2)--
`(A) IN GENERAL- The term `energy efficient commercial building
property' means any property which reduces total annual energy and power
costs with respect to the lighting, heating, cooling, ventilation, and hot
water supply systems of the building by 50 percent or more in comparison to
a reference building which meets the requirements of Standard 90.1-1999 of
the American Society of Heating, Refrigerating, and Air Conditioning
Engineers and the Illuminating Engineering Society of North America using
methods of calculation under subparagraph (B) and certified by qualified
professionals as provided under paragraph (6).
`(B) METHODS OF CALCULATION- The Secretary, in consultation with the
Secretary of Energy, shall promulgate regulations which describe in detail
methods for calculating and verifying energy and power consumption and cost,
taking into consideration the provisions of the 1998 California
Nonresidential ACM Manual. These procedures shall meet the following
requirements:
`(i) In calculating tradeoffs and energy performance, the regulations
shall prescribe the costs per unit of energy and power, such as kilowatt
hour, kilowatt, gallon of fuel oil, and cubic foot or Btu of natural gas,
which may be dependent on time of usage.
`(ii) The calculational methodology shall require that compliance be
demonstrated for a whole building. If some systems of the building, such
as lighting, are designed later than other systems of the building, the
method
shall provide that either--
`(I) the expenses taken into account under paragraph (1) shall not
occur until the date designs for all energy-using systems of the
building are completed,
`(II) the energy performance of all systems and components not yet
designed shall be assumed to comply minimally with the requirements of
such Standard 90.1-1999, or
`(III) the expenses taken into account under paragraph (1) shall be
a fraction of such expenses based on the performance of less than all
energy-using systems in accordance with clause (iii).
`(iii) The expenditures in connection with the design of subsystems in
the building, such as the envelope, the heating, ventilation, air
conditioning and water heating system, and the lighting system shall be
allocated to the appropriate building subsystem based on system-specific
energy cost savings targets in regulations promulgated by the Secretary of
Energy which are equivalent, using the calculation methodology, to the
whole building requirement of 50 percent savings.
`(iv) The calculational methods under this subparagraph need not
comply fully with section 11 of such Standard 90.1-1999.
`(v) The calculational methods shall be fuel neutral, such that the
same energy efficiency features shall qualify a building for the deduction
under this subsection regardless of whether the heating source is a gas or
oil furnace or an electric heat pump.
`(vi) The calculational methods shall provide appropriate calculated
energy savings for design methods and technologies not otherwise credited
in either such Standard 90.1-1999 or in the 1998 California Nonresidential
ACM Manual, including the following:
`(I) Natural ventilation.
`(II) Evaporative cooling.
`(III) Automatic lighting controls such as occupancy sensors,
photocells, and timeclocks.
`(V) Designs utilizing semi-conditioned spaces that maintain
adequate comfort conditions without air conditioning or without
heating.
`(VI) Improved fan system efficiency, including reductions in static
pressure.
`(VII) Advanced unloading mechanisms for mechanical cooling, such as
multiple or variable speed compressors.
`(VIII) The calculational methods may take into account the extent
of commissioning in the building, and allow the taxpayer to take into
account measured performance that exceeds typical
performance.
`(i) IN GENERAL- Any calculation under this paragraph shall be
prepared by qualified computer software.
`(ii) QUALIFIED COMPUTER SOFTWARE- For purposes of this subparagraph,
the term `qualified computer software' means software--
`(I) for which the software designer has certified that the software
meets all procedures and detailed methods for caculating energy and
power consumption and costs as required by the Secretary.
`(II) which provides such forms as required to be filed by the
Secretary in connection with energy efficiency of property and the
deduction allowed under this subsection, and
`(III) which provides a notice form which summarizes the energy
efficiency features of the building and its projected annual energy
costs.
`(4) ALLOCATION OF DEDUCTION FOR PUBLIC PROPERTY- In the case of energy
efficient commercial building property installed on or in public property, the
Secretary shall promulgate a regulation to allow the allocation of the
deduction to the person primarily responsible for designing the property in
lieu of the public entity which is the owner of such property. Such person
shall be treated as the tax payer for purposes of this subsection.
`(5) NOTICE TO OWNER- The qualified individual shall provide an
explanation to the owner of the building regarding the energy efficiency
features of the building and its projected annual energy costs as provided in
the notice under paragraph (3)(C)(ii)(III).
`(A) IN GENERAL- Except as provided in this paragraph, the Secretary, in
consultation with the Secretary of Energy, shall establish requirements for
certification and compliance procedures similar to the procedures under
section 25B(c)(7).
`(B) QUALIFIED INDIVIDUALS- Individuals qualified to determine
compliance shall be only those individuals who are recognized by an
organization certified by the Secretary for such purposes.
`(C) PROFICIENCY OF QUALIFIED INDIVIDUALS- The Secretary shall consult
with nonprofit organizations and State agencies with expertise in energy
efficiency calculations and inspections to develop proficiency tests and
training programs to qualify individuals to determine compliance.
`(g) TERMINATION- This section shall not apply with respect to--
`(1) any energy property placed in service before December 31, 2000, and
after December 31, 2006, and
`(2) any energy efficient commercial building property expenditures in
connection with property--
`(A) the plans for which are not certified under subsection (f)(6) on
or before December 31, 2006, and
`(B) the construction of which is not completed on or before December
31, 2008.'
TITLE II--NONBUSINESS ENERGY SYSTEMS
SEC. 201. CREDIT FOR CERTAIN NONBUSINESS ENERGY SYSTEMS.
(a) IN GENERAL- Subpart A of part IV of subchapter A of chapter 1
(relating to nonrefundable personal credits) is amended by inserting after
section 25A the following:
`SEC. 25B. NONBUSINESS ENERGY PROPERTY.
`(a) Allowance of Credit-
`(1) IN GENERAL- In the case of an individual, there shall be allowed as
a credit against the tax imposed by this chapter for the taxable year an
amount equal to the sum of--
`(A) the applicable percentage of residential energy property
expenditures made by the taxpayer during such year,
`(B) the credit amount (determined under section 48A(e)) for each
vehicle purchased during the taxable year which is a qualified hybrid
vehicle (as defined in section 48A(e)(2)), and
`(C) the credit amount specified in the following table for a new,
highly energy-efficient principal residence:
----------------------------------------------------------------------
In the case of: The credit amount is: For the period:
Beginning on: Ending on:
----------------------------------------------------------------------
30 percent property $1,000 1/1/2001 12/31/2002
50 percent property $2,000 1/1/2001 12/31/2004.
----------------------------------------------------------------------
In the case of any new, highly energy-efficient principal residence,
the credit amount shall be zero for any period for which a credit amount
is not specified for such property in the table under subparagraph
(C).
`(2) Applicable percentage-
`(A) IN GENERAL- The applicable percentage shall be determined in
accordance with the following table:
------------------------------------------------------------------------
In the case of: Percentage is: For the period:
Beginning on: Ending on:
------------------------------------------------------------------------
20% energy-eff. bldg. prop 20 1/1/2001 12/31/2004
10% energy-eff. bldg. prop 10 1/1/2001 12/31/2002
Solar water heating property 15 1/1/2001 12/31/2007
Photovoltaic property 15 1/1/2001 12/31/2007.
------------------------------------------------------------------------
`(B) PERIODS FOR WHICH PERCENTAGE NOT SPECIFIED- In the case of any
residential energy property, the applicable percentage shall be zero for
any period for which an applicable percentage is not specified for such
property under subparagraph (A).
`(1) IN GENERAL- In the case of property described in the following
table, the amount of the credit allowed under subsection (a)(1)(A) for the
taxable year for each item of such property with respect to a dwelling unit
shall not exceed the amount specified for such property in such table:
Description of property item:
Maximum allowable credit amount is:
20 percent energy-efficient building property (other than a fuel cell or
natural gas heat pump)
$500.
20 percent energy-efficient building property fuel cell described in section
48A(d)(3)(A)(i)
$500 per each kw/hr of capacity.
Natural gas heat pump described in section 48A(d)(3)(D)(iv)
$1,000.
10 percent energy-efficient building property
$250.
Solar water heating property
$1,000.
Photovoltaic property
$2,000.
(2) COORDINATION OF LIMITATIONS- If a credit is allowed to the taxpayer
for any taxable year by reason of an acquisition of a new, highly
energy-efficient principal residence, no other credit shall be allowed under
subsection (a)(1)(A) with respect to such residence during the 1-taxable
year period beginning with such taxable year.
`(c) DEFINITIONS- For purposes of this section--
`(1) RESIDENTIAL ENERGY PROPERTY EXPENDITURES- The term `residential
energy property expenditures' means expenditures made by the taxpayer for
qualified energy property installed on or in connection with a dwelling unit
which--
`(A) is located in the United States, and
`(B) is used by the taxpayer as a residence.
Such term includes expenditures for labor costs properly allocable to
the onsite preparation, assembly, or original installation of the
property.
`(2) Qualified energy property-
`(A) IN GENERAL- The term `qualified energy property' means--
`(i) energy-efficient building property,
`(ii) solar water heating property, and
`(iii) photovoltaic property.
`(B) SWIMMING POOL, ETC., USED AS STORAGE MEDIUM; SOLAR PANELS- For
purposes of this paragraph, the provisions of subparagraphs (B) and (C) of
section 48A(d)(1) shall apply.
`(3) ENERGY-EFFICIENT BUILDING PROPERTY- The term `energy-efficient
building property' has the meaning given to such term by section
48A(e)(3).
`(4) SOLAR WATER HEATING PROPERTY- The term `solar water heating
property' means property which, when installed in connection with a
structure, uses solar energy for the purpose of providing hot water for use
within such structure.
`(5) PHOTOVOLTAIC PROPERTY- The term `photovoltaic property' means
property which, when installed in connection with a structure, uses a solar
photovoltaic process to generate electricity for use in such
structure.
`(6) New, highly energy-efficient principal residence-
`(A) IN GENERAL- Property is a new, highly energy-efficient principal
residence if--
`(i) such property is located in the United States,
`(ii) the original use of such property commences with the taxpayer
and is, at the time of such use, the principal residence of the
taxpayer, and
`(iii) such property is certified before such use commences as being
50 percent property or 30 percent property.
`(B) 50 or 30 percent property-
`(i) IN GENERAL- For purposes of subparagraph (A), property is 50
percent property or 30 percent property if the projected energy usage of
such property is reduced by 50 percent or 30 percent, respectively,
compared to the energy usage of a reference house that complies with
minimum standard practice, such as the 1998 International Energy
Conservation Code of the International Code Council, as determined
according to the requirements specified in clause (ii).
`(I) IN GENERAL- For purposes of clause (i), energy usage shall be
demonstrated either by a component-based approach or a
performance-based approach.
`(II) COMPONENT APPROACH- Compliance by the component approach is
achieved when all of the components of the house comply with the
requirements of prescriptive packages established by the Secretary of
Energy, in consultation with the Administrator of the Environmental
Protection Agency, such that they are equivalent to the results of
using the performance-based approach of subclause (III) to achieve the
required reduction in energy usage.
`(III) PERFORMANCE-BASED APPROACH- Performance-based compliance
shall be demonstrated in terms of the required percentage reductions
in projected energy use. Computer software used in support of
performance-based compliance must meet all of the procedures and
methods for calculating energy savings reductions that are promulgated
by the Secretary of Energy. Such regulations on the specifications for
software shall be based in the 1998 California Residential Alternative
Calculation Method Approval Manual, except that the calculation
procedures shall be developed such that the same energy efficiency
measures qualify as a home for tax credits regardless of whether the
home uses a gas or oil
furnace or boiler, or an electric heat pump.
`(IV) APPROVAL OF SOFTWARE SUBMISSIONS- The Secretary of Energy
shall approve software submissions that comply with the calculation
requirements of subclause (III).
`(C) DETERMINATIONS OF COMPLIANCE- A determination of compliance made
for the purposes of this paragraph shall be filed with the Secretary of
Energy within 1 year of the date of such determination and shall include
the TIN of the certifer, the address of the building in compliance, and
the identity of the person for whom such determination was performed.
Determinations of compliance filed within the Secretary of Energy shall be
available for inspection by the Secretary.
`(i) IN GENERAL- The Secretary of Energy in consultation with the
Secretary of the Treasury shall establish requirements for certification
and compliance procedures after examining the requirements for energy
consultants and home energy ratings providers specified by the Mortgage
Industry National Accreditation Procedures for Home Energy Rating
Systems.
`(ii) INDIVIDUALS QUALIFIED TO DETERMINE COMPLIANCE- Indivdiuals
qualified to determine compliance shall be only those individuals who
are recognized by an organization certified by the Secretary of Energy
for such purposes.
`(E) PRINCIPAL RESIDENCE- The term `principal residence' has the same
meaning as when used in section 121, except that the period for which a
building is treated as the principal residence of the taxpayer shall also
include the 60-day period ending on the 1st day on which it would (but for
this subparagraph) first be treated as the taxpayer's principal
residence.
`(d) SPECIAL RULES- For purposes of this section--
`(1) DOLLAR AMOUNTS IN CASE OF JOINT OCCUPANCY- In the case of any
dwelling unit which if jointly occupied and used during any calendar year as
a residence by 2 or more individuals the following shall apply:
`(A) The amount of the credit allowable under subsection (a) by reason
of expenditures made during each calendar year by any of such individuals
with respect to such dwelling unit shall be determined by treating all of
such individuals as 1 taxpayer whose taxable year is such calendar
year.
`(B) There shall be allowable with respect to such expenditures to
each of such individuals, a credit under subsection (a) for the taxable
year in which such calendar year ends in an amount which bears the same
ratio to the amount determined under subparagraph (A) as the amount of
such expenditures made by such individuals during such calendar year bears
to the aggregate of such expenditures made by all of such individuals
during such calendar year.
`(2) TENANT-STOCKHOLDER IN COOPERATIVE HOUSING CORPORATION- In the case
of an individual who is a tenant-stockholder (as defined in section 216) in
a cooperative housing corporation (as defined in such section), such
individual shall be treated as having made his tenant-stockholder's
proportinate share (as defined in section 216(b)(3)) of any expenditures of
such corporation.
`(A) IN GENERAL- In the case of an individiual who is a member of a
condominium management association with respect to a condominium which the
individual owns, such individual shall be treated as having made his
proportionate share of any expenditures of such association.
`(B) CONDOMINIUM MANAGEMENT ASSOCIATION- For purpose of this
paragraph, the `condominium management association' means an organization
which meets the requirements of paragraph (1) of section 528(c) (other
than subparagraph (E) thereof) with respect to a condominimum project
substantially all of the units of which are used as residences.
`(4) Joint ownership of energy items-
`(A) IN GENERAL- Any expenditure otherwise qualifying as a residential
energy property expenditure shall not be treated as failing to so qualify
merely because such expenditure was made with respect to 2 or more
dwelling units.
`(B) LIMITS APPLIED SEPARATELY- In the case of any ependiture
described in subparagraph (A), the amount of the credit allowable under
subsection (a) shall (subject to paragraph (1)) be computed separately
with respect to the amount of the expenditure made for each dwelling
unit.
`(5) Allocation in certain cases-
`(A) IN GENERAL- Except as provided in subparagraph (B), if less than
80 percent of the use of an item as for nonbusiness purposes, only that
portion of the expenditures for such item which is properly allocable to
use for nonbusiness purposes shall be taken into account. For purposes of
this paragraph, use for a swimming pool shall be treated as use which is
not for nonbusiness purposes.
`(B) SPECIAL RULE FOR VEHICLES- For purposes of this section and
section 48A, a vehicle shall be treated as used entirely for business or
nonbusiness purposes if the majority of the use of such vehicle is for
business or nonbusiness purposes, as the case may be.
`(6) DOUBLE BENEFIT; PROPERTY USED OUTSIDE UNITED STATES, ETC., NOT
QUALIFIED- No credit shall be allowed under subsection (a)(1)(B) with
respect to--
`(A) any property for which a credit is allowed under section 30 or
48A.
`(B) any property referrerd to in section 50(b), and
`(C) the portion of the cost of any property taken into account under
section 179 or 179A.
`(7) When expenditure made; amount of expenditure-
`(A) IN GENERAL- Except as provided in subparagraph (B), an
expenditure with respect to an item shall be treated as made when the
original installation of the item is completed.
`(B) EXPENDITURES PART OF BUILDING CONSTRUCTION- In the case of an
expenditure in connection with the construction of a structure, such
expenditure shall be treated as made when the original use of the
constructed structure by the taxpayer begins.
`(C) AMOUNT- The amount of any expenditure shall be the cost
thereof.
`(8) Property financed by subsidized energy financing-
`(A) REDUCTION OF EXPENDITURES- For purposes of determining the amount
of residential energy property expenditures made by any individual with
respect to any dwelling unit, there shall not be taken in to account
expenditures which are made from subsidized energy financing (as defined
in section 48A(f)(1)(C)).
`(B) DOLLAR LIMITS REDUCED- The dollar amounts in the table contained
in subsection (b)(1) with respect to each property purchased for such
dwelling unit for any taxable year of such taxpayer shall be reduced
proportionately by an amount equal to the sum of--
`(i) the amount of the expenditures made by the taxpayer during such
taxable year with respect to such dwelling unit and not taken into
account by reason of subparagraph (A), and
`(ii) the amount of any Federal, State, or local grant received by
the taxpayer during such taxable year which is used to make residential
energy property expenditures with respect to the dwelling unit and is
not included in the gross income of such taxpayer.
`(9) SAFETY CERTIFICATIONS- No credit shall be allowed under this
section for an
item of property unless--
`(A) in the case of solar water heating property, such property is
certified for performance and safety by the non-profit Solar Rating
Certification Corporation or a comparable entity endorsed by the
government of the State in which such property is installed, and
`(B) in the case of photovoltaic property, such property meets
appropriate fire and electric code requirements.
`(e) BASIS ADJUSTMENTS- For purposes of this subtitle, if a credit is
allowed under this section for any expenditure with respect to any property,
the increase in the basis of such property which would (but for this
subsection) result from such expenditure shall be reduced by the amount of the
credit so allowed.'
(b) CONFORMING AMENDMENTS-
(1) Section 1016(a) is amended by striking `and' at the end of paragraph
(26), by striking the period at the end of paragraph (27) and inserting `;
and', and by adding at the end the following:
`(28) to the extent provided in section 25B(e), in the case of amounts
with respect to which a credit has been allowed under section 25B.'
(2) The table of sections for subpart A of part IV of subchapter A of
chapter 1 is amended by inserting after the item relating to section 25A the
following:
`Sec. 25B. Nonbusiness energy property.'
(c) EFFECTIVE DATE- The amendments made by this section shall apply to
expenditures after December 31, 2000.
TITLE III--ALTERNATIVE FUELS
SEC. 301. ALLOCATION OF ALCOHOL FUELS CREDIT TO PATRONS OF A
COOPERATIVE.
(a) IN GENERAL- Section 40(d) (relating to alcohol used as fuel) is
amended by adding at the end the following:
`(6) ALLOCATION OF SMALL ETHANOL PRODUCER CREDIT TO PATRONS OF
COOPERATIVE-
`(A) IN GENERAL- In the case of a cooperative organization described
in section 1381(a), any portion of the credit determined under subsection
(a)(3) for the taxable year may, at the election of the organization made
on a timely filed return (including extensions) for such year, be
apportioned pro rata among patrons of the organization on the basis of the
quantity or value of business done with or for such patrons for the
taxable year. Such an election, once made, shall be irrevocable for such
taxable year.
`(B) TREATMENT OF ORGANIZATIONS AND PATRONS- The amount of the credit
apportioned to patrons pursuant to subparagraph (A)--
`(i) shall not be included in the amount determined under subsection
(a) for the taxable year of the organization, and
`(ii) shall be included in the amount determined under subsection
(a) for the taxable year of each patron in which the patronage dividend
for the taxable year referred to in subparagraph (A) is includible in
gross income.
`(C) SPECIAL RULE FOR DECREASING CREDIT FOR TAXABLE YEAR- If the
amount of the credit of a cooperative organization determined under
subsection (a)(3) for a taxable year is less than the amount of such
credit shown on the cooperative organization's return for such year, an
amount equal to the excess of such reduction over the amount not
apportioned to the patrons under subparagraph (a) for the taxable year
shall be treated as an increase in tax imposed by this chapter on the
organization. Any such increase shall not be treated as tax imposed by
this chapter for purposes of determining the amount of any credit under
this subpart or subpart A, B, E, or G of this part.'
(b) TECHNICAL AMENDMENT- Section 1388 (relating to definitions and special
rules for cooperative organizations) is amended by adding at the end the
following:
`(k) CROSS REFERENCE- For provisions relating to the apportionment of the
alcohol fuels credit between cooperative organizations and their patrons, see
section 40(d)(6).'
(c) EFFECTIVE DATE- The amendments made by this section shall apply to
taxable years beginning after December 31, 2000.
TITLE IV--AUTOMOBILES
SEC. 401. EXTENSION OF CREDIT FOR QUALIFIED ELECTRIC VEHICLES.
(a) EXTENSION OF CREDIT FOR QUALIFIED ELECTRIC VEHICLES- Subsection (f) of
section 30 (relating to termination) is amended by striking `December 31,
2004' and inserting `December 31, 2006'.
(b) REPEAL OF PHASEOUT- Subsection (b) of section 30 (relating to
limitations) is amended by striking paragraph (2) and redesignating paragraph
(3) as paragraph (2).
(1) Subsection (d) of section 30 (relating to special rules) is amended
by adding at the end the following:
`(5) NO DOUBLE BENEFIT- No credit shall be allowed under subsection (a)
with respect to any vehicle if the taxpayer claims a credit for such vehicle
under section 25B(a)(1)(B) or 48A(a)(2).'
(2) Paragraph (3) of section 30(d) (relating to property used outside
United States, etc., not qualified) is amended by striking `section 50(b)'
and inserting `section 25B, 48A, or 50(b)'.
(3) Paragraph (5) of section 179A(e) (relating to property used outside
United States, etc., not qualified) is amended by striking `section 50(b)'
and inserting `section 25B, 48A, or 50(b)'.
(d) EFFECTIVE DATE- The amendments made by this section shall apply to
property placed in service after December 31, 2000.
SEC. 402. ADDITIONAL DEDUCTION FOR COST OF INSTALLATION OF ALTERNATIVE
FUELING STATIONS.
(a) IN GENERAL- Subparagraph (A) of section 179A(b)(2) of the Internal
Revenue Code of 1986 (relating to qualified clean-fuel vehicle refueling
property) is amended to read as follows:
`(A) IN GENERAL- The aggregate cost which may be taken into account
under subsection (a)(1)(B) with respect to qualified clean-fuel vehicle
refueling property placed in service during the taxable year at a location
shall not exceed the sum of--
`(i) with respect to costs not described in clause (ii), the excess
(if any) of--
`(II) the aggregate amount of such costs taken into account under
subsection (a)(1)(B) by the taxpayer (or any related person or
predecessor) with respect to property placed in service at such
location for all preceding taxable years, plus
`(I) the cost of the installation of such property,
or
(b) EFFECTIVE DATE- The amendment made by this section shall apply to
property placed in service after December 31, 2000.
SEC. 403. CREDIT FOR RETAIL SALE OF CLEAN BURNING FUELS AS MOTOR VEHICLE
FUEL.
(a) IN GENERAL- Subpart D of part IV of subchapter A of chapter 1 of the
Internal Revenue Code of 1986 (relating to business related credits) is
amended by inserting after section 40 the following:
`SEC. 40A. CREDIT FOR RETAIL SALE OF CLEAN BURNING FUELS AS MOTOR VEHICLE
FUEL.
`(a) GENERAL RULE- For purposes of section 38, the clean burning fuel
retail sales credit of any taxpayer for any taxable year is 50 cents for each
gasoline gallon equivalent of clean burning fuel sold at retail by the
taxpayer during such year as a fuel to propel any qualified motor vehicle.
`(b) DEFINITIONS- For purposes of this section--
`(1) CLEAN BURNING FUEL- The term `clean burning fuel' means natural
gas, compressed natural gas, liquefied natural gas, liquefied petroleum gas,
hydrogen, and any liquid at least 85 percent of which consists of
methanol.
`(2) GASOLINE GALLON EQUIVALENT- The term `gasoline gallon equivalent'
means, with respect to any clean burning fuel, the amount (determined by the
Secretary) of such fuel having a Btu content of 114,000.
`(3) QUALIFIED MOTOR VEHICLE- The term `qualified motor vehicle' means
any motor vehicle (as defined in section 179A(e)) which meets any applicable
Federal or State emissions standards with respect to each fuel by which such
vehicle is designed to be propelled.
`(A) IN GENERAL- The term `sold at retail' means the sale, for a
purpose other than resale, after manufacture, production, or
importation.
`(B) USE TREATED AS SALE- If any person uses clean burning fuel as a
fuel to propel any qualified motor vehicle (including any use after
importation) before such fuel is sold at retail, then such use shall be
treated in the same manner as if such fuel were sold at retail as a fuel
to propel such vehicle by such person.
`(c) NO DOUBLE BENEFIT- The amount of the credit determined under
subsection (a) shall be reduced by the amount of any deduction or credit
allowable under this chapter for fuel taken into account in computing the
amount of such credit.
`(d) TERMINATION- This section shall not apply to any fuel sold at retail
after December 31, 2007.'.
(b) CREDIT TREATED AS BUSINESS CREDIT- Section 38(b) of the Internal
Revenue Code of 1986 (relating to current year business credit) is amended by
striking `plus' at the end of paragraph (11), by striking the period at the
end of paragraph (12) and inserting, `, plus', and by adding at the end the
following:
`(13) the clean burning fuel retail sales credit determined under
section 40A(a).'.
(c) TRANSITIONAL RULE- Section 39(d) of the Internal Revenue Code of 1986
(relating to transitional rules) is amended by adding at the end the
following:
`(9) NO CARRYBACK OF SECTION 40A CREDIT BEFORE EFFECTIVE DATE- No
portion of the unused business credit for any taxable year which is
attributable to the clean burning fuel retail sales credit determined under
section 40A(a) may be carried back to a taxable year ending before January
1, 2000.'.
(d) CLERICAL AMENDMENT- The table of sections for subpart D of part IV of
subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by
inserting after the item relating to section 40 the following:
`Sec. 40A. Credit for retail sale of clean burning fuels as motor vehicle
fuel.'.
(e) EFFECTIVE DATE- The amendments made by this section shall apply to
fuel sold at retail after December 31, 2000, in taxable years ending after
such date.
SEC. 404. EXCEPTION TO HOV PASSENGER REQUIREMENTS FOR ALTERNATIVE FUEL
VEHICLES.
Section 102(a) of title 23, United States Code, is amended by inserting
`(unless, at the discretion of the State highway department, the vehicle
operates on, or is fueled by, an alternative fuel (as defined in section 301
of Public Law 102-486 (42 U.S.C. 13211(2)))' after `required'.
TITLE V--CLEAN COAL TECHNOLOGIES
SEC. 501. CREDIT FOR INVESTMENT IN QUALIFFYING CLEAN COAL TECHNOLOGY.
(a) ALLOWANCE OF QUALIFYING CLEAN COAL TECHNOLOGY FACILITY CREDIT- Section
46 (relating to amount of credit) is amended by striking `and' at the end of
paragraph (2), by striking the period at the end of paragraph (3) and
inserting `, and', and by adding at the end the following:
`(4) the qualifying clean coal technology facility credit.'
(b) AMOUNT OF QUALIFYING CLEAN COAL TECHNOLOGY FACILITY CREDIT- Subpart E
of part IV of subchapter A of chapter 1 (relating to rules for computing
investment credit), as amended by section 101(a), is amended by inserting
after section 48A the following:
`SEC. 48B. QUALIFYING CLEAN COAL TECHNOLOGY FACILITY CREDIT.
`(a) IN GENERAL- For purposes of section 46, the qualifying clean coal
technology facility credit for any taxable year is an amount equal to 10
percent of the qualified investment in a qualifying clean coal technology
facility for such taxable year.
`(b) Qualifying Clean Coal Technology Facility-
`(1) IN GENERAL- For purposes of subsection (a), the term `qualifying
clean coal technology facility' means a facility of the taxpayer--
`(A)(i)(I) which replaces a conventional technology facility of the
taxpayer and the original use of which commences with the taxpayer,
or
`(II) which is a retrofitted or repowered conventional technology
facility, the retrofitting or repowering of which is completed by the
taxpayer (but only with respect to that portion of the basis which is
properly attributable to such retrofitting or repowering), or
`(ii) that is acquired through purchase (as defined by section
179(d)(2)),
`(B) that is depreciable under section 167,
`(C) that has a useful life of not less than 4 years,
`(D) that is located in the United States, and
`(E) that uses qualifying clean coal technology.
`(2) SPECIAL RULE FOR SALE-LEASEBACKS- For purposes of subparagraph (A)
of paragraph (1), in the case of a facility that--
`(A) is originally placed in service by a person, and
`(B) is sold and leased back by such person, or is leased to such
person, within 3 months after the date such facility was originally placed
in servcie, for a period of not less than 12 years.
such facility shall be treated as originally placed in service not
earlier than the date on which such property is used under the leaseback (or
lease) referred to in subparagraph (B). The preceding sentence shall not
apply to any property if the lessee and lessor of such property make an
election under this sentence. Such an election, once made, may be revoked
only with the consent of the Secretary.
`(3) QUALIFYING CLEAN COAL TECHNOLOGY- For purposes of paragraph
(1)(A)--
`(A) IN GENERAL- The term `qualifying clean coal technology' means,
with respect to clean coal technology--
`(i) applications totaling 1,000 megawatts of advanced pulverized
coal or atmospheric fluidized bed combustion technology installed as a
new, retrofit, or repowering application and operated between 2000 and
2014 that has a design average net heat rate of not more than 8,750
Btu's per kilowatt hour,
`(ii) applications totaling 1,500 megawatts of pressurized fluidized
bed combustion technology installed as a new, retrofit, or repowering
application and operated between 2000 and 2014 that has a design average
net heat rate of not more than 8,400 Btu's per kilowatt
hour,
`(iii) applications totaling 1,500 megawatts of integrated
gasification combined cycle technology installed as a new, retrofit, or
repowering application and operated between 2000 and 2014 that has a
design average net heat rate of not more than 8,550 Btu's per kilowatt
hour,
`(iv) applications totaling 2,000 megawatts or equivalent of
technology for the production of electricity installed as a new,
retrofit, or repowering application and operated between 2000 and 2014
that has a carbon emission rate that is not more than 85 percent of
conventional technology.
`(B) EXCEPTIONS- Such term shall not include clean coal technology
projects receiving or scheduled to receive funding under the Clean Coal
Technology Program of the Department of Energy.
`(C) CLEAN COAL TECHNOLOGY- The term `clean coal technology' means
advanced technology that utilizes coal to produce 50 percent or more of
its thermal output as electricity including advanced pulverized coal or
atmospheric fluidized bed combustion, pressurized fluidized bed
combustion, integrated gasification combined cycle, and any other
technology for the production of electricity that exceeds the performance
of conventional technology.
`(D) CONVENTIONAL COAL TECHNOLOGY- The term `conventional technology'
means--
`(i) coal-fired combustion technology with a design average net heat
rate of not less than 9,300 Btu's per kilowatt hour (HHV) and a carbon
equivalents emission rate of not more than 0.53 pounds of carbon per
kilowatt hour; or
`(ii) natural gas-fired combustion technology with a design average
net heat rate of not less than 7,500 Btu's per kilowatt hour (HHV) and a
carbon equivalents emission rate of not more than 0.24 pound of carbon
per kilowatt hour.
`(E) DESIGN AVERAGE NET HEAT RATE- The term `design average net heat
rate' shall be based on the design average annual heat input to and the
design average annual net electrical output from the qualifying clean coal
technology (determined without regard to such technology's co-generation
of steam).
`(F) SELECTION CRITERIA- Selection criteria for clean coal technology
facilities--
`(i) shall be established by the Secretary of Energy as part of a
competitive solicitation,
`(ii) shall include primary criteria of minimum design average net
heat rate, maximum design average thermal efficiency, and lowest cost to
the government, and
`(iii) shall include supplemental criteria as determined appropriate
by the Secretary of Energy.
`(c) QUALIFIED INVESTMENT- For purposes of subsection (a), the term
`qualified investment' means, with respect to any taxable year, the basis of a
qualifying clean coal technology facility placed in service by the taxpayer
during such taxable year.
`(d) QUALIFIED PROGRESS EXPENDITURES-
`(1) INCREASE IN QUALIFIED INVESTMENT- In the case of a taxpayer who has
made an election under paragraph (5), the amount of the qualified investment
of such taxpayer for the taxable year (determined under subsection (c)
without regard to this section) shall be increased by an amount equal to the
aggregate of each qualified progress expenditure for the taxable year with
respect to progress expenditure property.
`(2) PROGRESS EXPENDITURE PROPERTY DEFINED- For purposes of this
subsection, the term `progress expenditure property' means any property
being constructed by or for the taxpayer and which it is reasonable to
believe will qualify as a qualifying clean coal technology facility which is
being constructed by or for the taxpayer when it is placed in service.
`(3) QUALIFIED PROGRESS EXPENDITURES DEFINED- For purposes of this
subsection--
`(A) SELF-CONSTRUCTED PROPERTY- In the case of any self-constructed
property, the term `qualified progress expenditures' means the amount
which, for purposes of this subpart, is properly chargeable (during such
taxable year) to capital account with respect to such property.
`(B) NON-SELF-CONSTRUCTED PROPERTY- In the case of
non-self-constructed property, the term `qualified progress expenditures'
means the amount paid during the taxable year to another person for the
construction of such property.
`(4) OTHER DEFINITIONS- For purposes of this subsection--
`(A) SELF-CONSTRUCTED PROPERTY- The term `self-constructed property'
means property for which it is reasonable to believe that more than half
of the construction expenditures will be made directly by the
taxpayer.
`(B) NON-SELF-CONSTRUCTED PROPERTY- The term `non-self-constructed
property' means property which is not self-constructed property.
`(C) CONSTRUCTION, ETC- The term `construction' includes
reconstruction and erection, and the term `constructed' includes
reconstructed and erected.
`(D) ONLY CONSTRUCTION OF QUALIFYING CLEAN COAL TECHNOLOGY FACILITY TO
BE TAKEN INTO ACCOUNT- Construction shall be taken into account only if,
for purposes of this subpart, expenditures therefor are properly
chargeable to capital account with respect to the property.
`(5) ELECTION- An election under this subsection may be made at such
time and in such manner as the Secretary may by regulations prescribe. Such
an election shall apply to the taxable year for which made and to all
subsequent taxable years. Such an election, once made, may not be revoked
except with the consent of the Secretary.
`(e) COORDINATION WITH OTHER CREDITS- This section shall not apply to any
property with respect to which the rehabilitation credit under section 47 or
the energy credit under section 48A is allowed unless the taxpayer elects to
waive the application of such credit to such property.
`(f) TERMINATION- This section shall not apply with respect to any
qualified investment after December 31, 2014.'
`(c) RECAPTURE- Section 50(a) (relating to other special rules) is amended
by adding at the end the following:
`(6) SPECIAL RULES RELATING TO QUALIFYING CLEAN COAL TECHNOLOGY
FACILITY- For purposes of applying this subsection in the case of any credit
allowable by reason of section 48B, the following shall apply:
`(A) GENERAL RULE- In lieu of the amount of the increase in tax under
paragraph (1), the increase in tax shall be an amount equal to the
investment tax credit allowed under section 38 for all prior taxable years
with respect to a qualifying clean coal technology facility (as defined by
section 48B(b)(1)) multiplied by a fraction whose numerator is the number
of years remaining to fully depreciate under this title the qualifying
clean coal technology facility disposed of, and whose denominator is the
total number of years over which such facility would otherwise have been
subject to depreciation. For purposes of the preceding sentence, the year
of disposition of the qualifying clean coal technology facility property
shall be treated as a year of remaining depreciation.
`(B) PROPERTY CEASES TO QUALIFY FOR PROGRESS EXPENDITURES- Rules
similar to the rules of paragraph (2) shall apply in the case of qualified
progress expenditures for a qualifying clean coal technology facility
under section 48B, except that the amount of the increase in tax under
subparagraph (A) of this paragraph shall be substituted in lieu of the
amount described in such paragraph (2).
`(C) APPLICATION OF PARAGRAPH- This paragraph shall be applied
separately with respect to the credit allowed under section 38 regarding a
qualifying clean coal technology facility.'
(d) TRANSITIONAL RULE- Section 39(d) of the Internal Revenue Code of 1986
(relating to transitional rules), as amended by section 101(b)(2), is amended
by adding at the end the following:
`(10) NO CARRYBACK OF SECTION 48B CREDIT BEFORE EFFECTIVE DATE- No
portion of the unused business credit for any taxable year which is
attributable to the qualifying clean coal technology facility credit
determined under section 48B may be carried back to a taxable year ending
before the date of the enactment of section 48B.'
(e) Technical Amendments-
(1) Section 49(a)(1)(C) is amended by striking `and' at the end of
clause (ii), by striking the period at the end of clause (iii) and inserting
`, and', and by adding at the end the following:
`(iv) the portion of the basis of any qualifying clean coal
technology facility attributable to any qualified investment (as
defined by section 48B(c)).'
(2) Section 50(a)(4) is amended by striking `and (2)' and inserting `,
(2), and (6)'.
(3) The table of sections for subpart E of part IV of subchapter A of
chapter 1, as amended by section 101(d), is amended by inserting after the
item relating to section 48A the following:
`Sec. 48B. Qualifying clean coal technology facility credit.'
(f) EFFECTIVE DATE- The amendments made by this section shall apply to
periods after December 31, 2000, 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 Reconciliation Act of 1990).
SEC. 502. CREDIT FOR PRODUCTION FROM QUALIFYING CLEAN COAL TECHNOLOGY.
(a) CREDIT FOR PRODUCTION FROM QUALIFYING CLEAN COAL TECHNOLOGY- Subpart D
of part IV of subchapter A of chapter 1 (relating to business related credits)
is amended by adding at the end the following:
`SEC. 45D. CREDIT FOR PRODUCTION FROM QUALIFYING CLEAN COAL TECHNOLOGY.
`(a) GENERAL RULE- For purposes of section 38, the qualifying clean coal
technology production credit of any taxpayer for any taxable year is equal to
the applicable amount for each kilowatt hour--
`(1) produced by the taxpayer at a qualifying clean coal technology
facility during the 10-year period beginning on the date the facility was
originally placed in service, and
`(2) sold by the taxpayer to an unrelated person during such taxable
year.
`(b) APPLICABLE AMOUNT- For purposes of this section, the applicable
amount with respect to production from a qualifying clean coal technology
facility shall be determined as follows:
`(1) In the case of a facility originally placed in service before 2007,
if--
----------------------------------------------------------------------------------------------------------------------------------
`The facility design average net heat rate, Btu/kWh (HHV) is equal to: The applicable amount is:
For 1st 5 yrs of such service For 2d 5 yrs of such service
----------------------------------------------------------------------------------------------------------------------------------
Not more than 8400 $.0130 $.0110
More than 8400 but not more than 8550 .0100 .0085
More than 8550 but not more than 8750 .0090 .0070.
----------------------------------------------------------------------------------------------------------------------------------
`(2) In the case of a facility originally placed in service after 2006
and before 2011, if--
----------------------------------------------------------------------------------------------------------------------------------
`The facility design average net heat rate, Btu/kWh (HHV) is equal to: The applicable amount is:
For 1st 5 yrs of such service For 2d 5 yrs of such service
----------------------------------------------------------------------------------------------------------------------------------
Not more than 7770 $.0100 $.0080
More than 7770 but not more than 8125 .0080 .0065
More than 8125 but not more than 8350 .0070 .0055.
----------------------------------------------------------------------------------------------------------------------------------
`(3) In the case of a facility originally placed in service after 2010
and before 2015, if--
----------------------------------------------------------------------------------------------------------------------------------
`The facility design average net heat rate, Btu/kWh (HHV) is equal to: The applicable amount is:
For 1st 5 yrs of such service For 2d 5 yrs of such service
----------------------------------------------------------------------------------------------------------------------------------
Not more than 7720 $.0085 $.0070
More than 7720 but not more than 7380 .0070 .0045.
----------------------------------------------------------------------------------------------------------------------------------
`(c) INFLATION ADJUSTMENT FACTOR- Each amount in paragraphs (1), (2), and
(3) shall each be adjusted by multiplying such amount by the inflation
adjustment factor for the calendar year in which the amount is applied. If any
amount as increased under the preceding sentence is not a multiple of 0.01
cent, such amount shall be rounded to the nearest multiple of 0.01 cent.
`(d) DEFINITIONS AND SPECIAL RULES- For purposes of this section--
`(1) any term used in this section which is also used in section 48B
shall have the meaning given such term in section 48B,
`(2) the rules of paragraphs (3), (4), and (5) of section 45 shall
apply,
`(3) the term `inflation adjustment factor' means, with respect to a
calendar year, a fraction the numerator of which is the GDP implicit price
deflator for the preceding calendar year and the denominator of which is the
GDP implicit price deflator for the calendar year 1998, and
`(4) the term `GDP implicit price deflator' means the most recent
revision of the implicit price deflator for the gross domestic product as
computed by the Department of Commerce before March 15 of the calendar
year.'
(b) CREDIT TREATED AS BUSINESS CREDIT- Section 38(b) is amended by
striking `plus' at the end of paragraph (11), by striking the period at the
end of paragraph (12) and inserting `, plus', and by adding at the end the
following:
`(13) the qualifying clean coal technology production credit determined
under section 45D(a).'
(c) TRANSITIONAL RULE- Section 39(d) (relating to transitional rules), as
amended by section 501(d), is amended by adding at the end the following:
`(11) NO CARRYACK OF CERTAIN CREDITS BEFORE EFFECTIVE DATE- No portion
of the unused business credit for any taxable year which is attributable to
the credits allowable under any section added to this subpart by the
amendments made by the Energy Security Tax and Policy Act of 2000 may be
carried back to a taxable year ending before the date of the enactment of
such Act.'
(d) CLERICAL AMENDMENT- The table of sections for subpart D of part IV of
subchapter A
of chapter 1 is amended by adding at the end the following:
`Sec. 45D. Credit for production from qualifying clean coal
technology.'.
(e) EFFECTIVE DATE- The amendments made by this section shall apply to
production after December 31, 2000.
SEC. 503. RISK POOL FOR QUALIFYING CLEAN COAL TECHNOLOGY.
(a) ESTABLISHMENT- The Secretary of the Treasury shall establish a
financial risk pool which shall be available to any United States owner of
qualifying clean coal technology (as defined in section 48B(b)(3) of the
Internal Revenue Code of 1986) to offset for the first 3 three years of the
operation of such technology the costs (not to exceed 5 percent of the total
cost of installation) for modifications resulting from the technology's
failure to achieve its design performance.
(b) AUTHORIZATION OF APPROPRIATIONS- There is authorized to be
appropriated such sums as are necessary to carry out the purposes of this
section.
TITLE VI--METHANE RECOVERY
SEC. 601. CREDIT FOR CAPTURE OF COALMINE METHANE GAS.
(a) CREDIT FOR CAPTURE OF COALMINE METHANE GAS- Subpart D of part IV of
subchapter A of chapter 1 (relating to business related credits), as amended
by section 502(a), is amended by adding at the end the following:
`SEC. 45E. CREDIT FOR CAPTURE OF COALMINE METHANE GAS.
`(b) DEFINITION OF COALMINE METHANE GAS- The term `Coalmine Methane Gas'
as used in this section means any methane gas which is being liberated, or
would be liberated, during coal mine operations or as a result of past coal
mining operations, or which is extracted up to ten years in advance of coal
mining operations as part of specific plan to mine a coal deposit.
`For the purpose of section 38, the coalmine methane gas capture credit of
any taxpayer for any taxable year is $1.21 for each one million British
thermal units of coalmine methane gas captured by the taxpayer and utilized as
a fuel source or sold by or on behalf of the taxpayer to an unrelated person
during such taxable year (within the meaning of section 45).'.
(b) Credits for the capture of coalmine methane gas shall be earned upon
the utilization as a fuel source or sale and delivery of the coalmine methane
gas to an unrelated party, except that credit for coalmine methane gas which
is captured in advance of mining operations shall be claimed only after coal
extraction occurs in the immediate area where the coalmine methane gas was
removed.
(c) CREDIT TREATED AS BUSINESS CREDIT- Section 38(b), as amended by
section 502(b), is amended by striking `plus' at the end of paragraph (12), by
striking the period at the end of paragraph (13) and inserting `, plus', and
by adding at the end the following:
`(14) the coalmine methane gas capture credit determined under section
45E(a).'.
(d) CLERICAL AMENDMENT- The table of sections for subpart D of part IV of
subchapter A of chapter 1, as amended by section 502(d), is amended by adding
at the end the following:
`Sec. 45E. Credit for the capture of coalmine methane gas.'.
(e) EFFECTIVE DATE- The amendments made by this section shall apply to the
capture of coalmine methane gas after December 31, 2000, and on or before
December 31, 2006.
TITLE VII--OIL AND GAS PRODUCTION
SEC. 701. CREDIT FOR PRODUCTION OR RE-REFINED LUBRICATING OIL.
(a) IN GENERAL- Subpart D of part IV of subchapter A of chapter 1
(relating to business related credits), as amended by section 601(a), is
amended by adding at the end the following:
`SEC. 45F. CREDIT FOR PRODUCING RE-REFINED LUBRICATING OIL.
`(a) GENERAL RULE- For purposes of section 38, the re-refined lubricating
oil production credit of any taxpayer for any taxable year is equal to $4.05
per barrel of qualified re-refined lubricating oil production which is
attributable to the taxpayer (within the meaning of section 29(d)(3)).
`(b) QUALIFIED RE-REFINED LUBRICATING OIL PRODUCTION- For purposes of this
section--
`(1) IN GENERAL- The term `qualified re-refined lubricating oil
production' means a base oil manufactured from at least 95 percent used oil
and not more than 2 percent of previously unused oil by a re-refining
process which effectively removes physical and chemical impurities and spent
and unspent additives to the extent that such base oil meets industry
standards for engine oil as defined by the American Petroleum Institute
document API 1509 as in effect on the date of the enactment of this
section.
`(2) LIMITATION ON AMOUNT OF PRODUCTION WHICH MAY QUALIFY- Re-refined
lubricating oil produced during any taxable year shall not be treated as
qualified re-refined lubricating oil production but only to the extent
average daily production during the taxable year exceeds 7,000
barrels.
`(3) BARREL- The term `barrel' has the meaning given such term by
section 613A(e)(4).
(c) INFLATION ADJUSTMENT- In the case of any taxable year beginning in a
calendar year after 2000, the dollar amount contained in subsection (a) shall
be increased to an amount equal to such dollar amount multiplied by the
inflation adjustment factor for such calendar year (determined under section
29(d)(2)(B) by substituting `2000' for `1979').'.
(b) CREDIT TREATED AS BUSINESS CREDIT- Section 38(b) (relating to current
year business credit), as amended by section 601(b), is amended by striking
`plus' at the end of paragraph (13), by striking the period at the end of
paragraph (14), and inserting `, plus', and by adding at the end the
following:
`(15) the re-refined lubricating oil production credit determined under
section 45F(a).'.
(c) CLERICAL AMENDMENT- The table of sections for subpart D of part IV of
subchapter A of chapter 1, as amended by section 601(c), is amended by adding
at the end the following:
`Sec. 45F. Credit for producing re-refined lubricating oil.'.
(d) EFFECTIVE DATE- The amendments made by this section shall apply to
production after December 31, 2000.
SEC. 702. OIL AND GAS FROM MARGINAL WELLS.
`SEC. 45D. CREDIT FOR PRODUCING OIL AND GAS FROM MARGINAL WELLS.
`(a) GENERAL RULE- For purposes of section 38, the marginal well
production credit for any taxable year is an amount equal to the product
of--
`(1) the credit amount, and
`(2) the qualified credit oil production and the qualified natural gas
production which is attributable to the taxpayer.
`(b) CREDIT AMOUNT- For purposes of this section--
`(1) IN GENERAL- The credit amount is--
`(A) $3 per barrel of qualified crude oil production, and
`(B) 50 cents per 1,000 cubic feet of qualified natural gas
production.
`(2) REDUCTION AS OIL AND GAS PRICES INCREASE-
`(A) IN GENERAL- The $3 and 50 cents amounts under paragraph (1) shall
each be reduced (but not below zero) by an amount which bears the same
ratio to such amount (determined without regard to this paragraph)
as--
`(i) the excess (if any) of the applicable reference price over $14
($1.56 for qualified natural gas production), bears to
`(ii) $3 ($0.33 for qualified natural gas production).
The applicable reference price for a taxable year is the reference
price of the calendar year preceding the calendar year in which the
taxable year begins.
`(B) INFLATION ADJUSTMENT- In the case of any taxable year beginning
in a calendar year after 2000, each of the dollar amounts contained in
subparagraph
(A) shall be increased to an amount equal to such dollar amount multiplied by
the inflation adjustment factor for such calendar year (determined under section
43(b)(3)(B) by substituting `2000' for `1990').
`(C) REFERENCE PRICE- For purposes of this paragraph, the term
`reference price' means, with respect to any calendar year--
`(i) in the case of qualified crude oil production, the reference
price determined under section 29(d)(2)(C), and
`(ii) in the case of qualified natural gas production, the
Secretary's estimate of the annual average wellhead price per 1,000
cubic feet for all domestic natural gas.
`(c) QUALIFIED CRUDE OIL AND NATURAL GAS PRODUCTION- For purposes of this
section--
`(1) IN GENERAL- The terms `qualified crude oil production' and
`qualified natural gas production' mean domestic crude oil or natural gas
which is produced from a marginal well.
`(2) Limitation on amount of production which may qualify-
`(A) IN GENERAL- Crude oil or natural gas produced during any taxable
year from any well shall not be treated or qualified crude oil production
or qualified natural gas production to the extent production from the well
during the taxable year exceeds 1,095 barrels or barrel
equivalents.
`(B) Proportionate reductions-
`(i) SHORT TAXABLE YEARS- In the case of a short taxable year, the
limitations under this paragraph shall be proportionately reduced to
reflect the ratio which the number of days in such taxable year bears to
365.
`(ii) WELLS NOT IN PRODUCTION ENTIRE YEAR- In the case of a well
which is not capable of production during each day of a taxable year,
the limitations under this paragraph applicable to the well shall be
proportionately reduced to reflect the ratio which the number of days of
production bears to the total number of days in the taxable
year.
`(A) MARGINAL WELL- The term `marginal well' means a domestic
well--
`(i) the production from which during the taxable year is treated as
marginal production under section 613A(c)(6), or
`(ii) which, during the taxable year--
`(I) has average daily production of not more than 25 barrel
equivalents, and
`(II) produces water at a rate not less than 95 percent of total
well effluent.
`(B) CRUDE OIL, ETC- The terms `crude oil', `natural gas', `domestic',
and `barrel' have the meanings given such terms by section
613A(e).
`(C) BARREL EQUIVALENT- The term `barrel equivalent' means, with
respect to natural gas, a conversation ratio of 6,000 cubic feet of
natural gas to 1 barrel of crude oil.
`(1) PRODUCTION ATTRIBUTABLE TO THE TAXPAYER- In the case of a marginal
well in which there is more than one owner of operating interests in the
well and the crude oil or natural gas production exceeds the limitation
under subsection (c)(2), qualifying crude oil production or qualifying
natural gas production attributable to the taxpayer shall be determined on
the basis of the ratio which taxpayer's revenue interest in the production
bears to the aggregate of the revenue interests of all operating interest
owners in the production.
`(2) OPERATING INTEREST REQUIRED- Any credit under this section may be
claimed only on production which is attributable to the holder of an
operating interest.
`(3) PRODUCTION FROM NONCONVENTIONAL SOURCES EXCLUDED- In the case of
production from a marginal well which is eligible for the credit allowed
under section 29 for the taxable year, no credit shall be allowable under
this section unless the taxpayer elects not to claim the credit under
section 29 with respect to the well.'.
(c) CREDIT TREATED AS BUSINESS CREDIT- Section 38(b) is amended by
striking `plus' at the end of paragraph (11), by striking the period at the
end of paragraph (12) and inserting `, plus', and by adding at the end the
following new paragraph:
`(13) the marginal oil and gas well production credit determined under
section 45D(a).'.
(d) Credit Allowed Against Regular and Minimum Tax-
(1) IN GENERAL- Subsection (c) of section 38 (relating to limitation
based on amount of tax) is amended by redesignating paragraph (3) as
paragraph (4) and by inserting after paragraph (2) the following new
paragraph:
`(3) Special rules for marginal oil and gas well production
credit-
`(A) IN GENERAL- In the case of the marginal oil and gas well
production credit--
`(i) this section and section 39 shall be applied separately with
respect to the credit, and
`(ii) in applying paragraph (1) to the credit--
`(I) subparagraphs (A) and (B) thereof shall not apply,
and
`(II) the limitation under paragraph (1) (as modified by subclause
(I)) shall be reduced by the credit allowed under subsection (a) for
the taxable year (other than the marginal oil and gas well production
credit).
`(B) MARGINAL OIL AND GAS WELL PRODUCTION CREDIT- For purposes of this
subsection, the term `marginal oil and gas well production credit' means
the credit allowable under subsection (a) by reason of section
45D(a).'.
(2) CONFORMING AMENDMENT- Subclause (II) of section 38(c)(2)(A)(ii) is
amended by inserting `or the marginal oil and gas well production credit'
after `employment credit'.
(e) CARRYBACK- Subsection (a) of section 39 (relating to carryback and
carryforward of unused credits generally) is amended by adding at the end the
following new paragraph:
`(3) 10-year carryback for marginal oil and gas well production credit-
In the case of the marginal oil and gas well production credit--
`(A) this section shall be applied separately from the business credit
(other than the marginal oil and gas well production credit),
`(B) paragraph (1) shall be applied by substituting `10 taxable years'
for `1 taxable years' in subparagraph (A) thereof, and
`(C) paragraph (2) shall be applied--
`(i) by substituting `31 taxable years' for `21 taxable years' in
subparagraph (A) thereof, and
`(ii) by substituting `30 taxable years' for `20 taxable years' in
subparagraph (A) thereof.'.
(f) COORDINATION WITH SECTION 29- Section 29(a) is amended by striking
`There' and inserting `At the election of the taxpayer, there'.
(g) CLERICAL AMENDMENT- The table of sections for subpart D of part IV of
subchapter A of chapter I is amended by adding at the end the following
item:
`Sec. 45D. Credit for producing oil and gas from marginal wells.'
(h) EFFECTIVE DATE- The amendments made by this section shall apply to
production in taxable years beginning after December 31, 2000.
SEC. 703. DEDUCTION FOR DELAY RENTAL PAYMENTS.
(a) IN GENERAL- Section 263 (relating to capital expenditures) is amended
by adding after subsection (i) the following new subsection:
`(j) Delay Rental Payments for Domestic Oil and Gas Wells-
`(1) IN GENERAL- Notwithstanding subsection (a), a taxpayer may elect to
treat delay rental payments incurred in connection with the development of
oil or gas within the United States (as defined in section 638) as payments
which are not chargeable to capital account. Any payments so treated shall
be allowed as a deduction in the taxable year in which paid or
incurred.
`(2) DELAY RENTAL PAYMENTS- For purposes of paragraph (1), the term
`delay rental payment' means an amount paid for the privilege of deferring
development of an oil or gas well.'
(b) CONFORMING AMENDMENT- Section 263A(c)(3) is amended by inserting
`263(j),' after `263(i),'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to
amounts paid or incurred in taxable years beginning after December 31,
2000.
SEC. 704. ELECTION TO EXPENSE GEOLOGICAL AND GEOPHYSICAL EXPENDITURES.
(a) IN GENERAL- Section 263 (relating to capital expenditures) is amended
by adding after subsection (j) the following new subsection:
`(k) GEOLOGICAL AND GEOPHYSICAL EXPENDITURES FOR DOMESTIC OIL AND GAS
WELLS- Notwithstanding subsection (a), a taxpayer may elect to treat
geological and geophysical expenses incurred in connection with the
exploration for, or development of, oil or gas within the United States (as
defined in section 638) as expenses which are not chargeable to capital
account. Any expenses so treated shall be allowed as a deduction in the
taxable year in which paid or incurred.'
(b) CONFORMING AMENDMENT- Section 263A(c)(3) is amended by inserting
`263(k),' after `263(j),'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to
costs paid or incurred in taxable years beginning after December 31, 2000.
TITLE VIII--RENEWABLE POWER GENERATION
SEC. 801. MODIFICATIONS TO CREDIT FOR ELECTRICITY PRODUCED FROM RENEWABLE
RESOURCES.
(a) Expansion of Qualified Energy Resources-
(1) IN GENERAL- Section 45(c)(1) (defining qualified energy resources)
is amended by striking `and' at the end of subparagraph (B), by striking
subparagraph (C), and by adding at the end the following:
`(C) biomass (other than closed-loop biomass), or
(2) DEFINITIONS- Section 45(c) is amended by redesignating paragraph (3)
as paragraph (4) and by striking paragraphs (2) and (4) and inserting the
following:
`(A) IN GENERAL- The term `biomass' means--
`(i) closed-loop biomass, and
`(ii) any solid, nonhazardous, cellulosic waste material, which is
segregated from other waste materials, and which is derived
from--
`(I) any of the following forest-related resources: mill residues,
precommercial thinnings, slash, and brush, not including old-growth
timber,
`(II) waste pallets, crates, and dunnage, and landscape or
right-of-way tree trimmings, but not including unsegregated municipal
solid waste (garbage) and post-consumer wastepaper, or
`(III) agriculture sources, including orchard tree crops,
vineyard, grain, legumes, sugar, and other crop by-products or
residues.
`(B) CLOSED-LOOP BIOMASS- The term `closed-loop biomass' means any
organic material from a plant which is planted exclusively for purposes of
being used at a qualified facility to produce electricity.
`(3) POULTRY WASTE- The term `poultry waste' means poultry manure and
litter, including wood shavings, straw, rice hulls, and other bedding
material for the disposition of manure.'
(b) EXTENSION AND MODIFICATION OF PLACED-IN SERVICE RULES- Paragraph (4)
of section 45(c), as redesignated by subsection (a), is amended to read as
follows:
`(A) WIND FACILITY- In the case of a facility using wind to produce
electricity, the term `qualified facility' means any facility owned by the
taxpayer which is originally placed in service after December 31,
1993.
`(B) CLOSED-LOOP BIOMASS FACILITY- In the case of a facility using
closed-loop biomass to produce electricity, the term `qualified facility'
means any facility owned by the taxpayer which:
`(i) is originally placed in service after December 31, 1992 and
before January 1, 2005, or
`(ii) is originally placed in service before December 31, 2000, and
modified to use closed loop biomass to co-fire with coal after such date
and before January 1, 2005.
`(C) BIOMASS FACILITY- In the case of a facility using biomass (other
than closed-loop biomass) to produce electricity, the term `qualified
facility' means:
`(i) any facility owned by the taxpayer which is originally placed
in service after December 31, 2000 and before January 1, 2005,
or
`(ii) is originally placed in service before December 31, 2000 and
modified to co-fire biomass with coal after such date and before January
1, 2005.
`(D) POULTRY WASTE FACILITY- In the case of a facility using poultry
waste to produce electricity, the term `qualified facility'
means:
`(i) any facility of the taxpayer which is originally placed in
service after December 31, 1999 and before January 1, 2005,
or
`(ii) is originally placed in service before December 31, 2000 and
modified to co-fire poultry waste with coal after such date and before
January 1, 2005.
`(i) COMBINED PRODUCTION FACILITIES INCLUDED- For purposes of this
paragraph, the term `qualified facility' shall include a facility using
biomass to produce electricity and other biobased products such as
renewables based chemicals and fuels.
`(ii) SPECIAL RULES- In the case of a qualified facility described
in subparagraph (B), (C) or (D)--
`(I) the 10-year period referred to in subsection (a) shall be
treated as beginning upon the date the taxpayer first applies for the
credit, and
`(II) subsection (b)(3) shall not apply to any such facility
originally placed in service before January 1, 1997.'
(c) ELECTRICITY PRODUCED FROM BIOMASS CO-FIRED IN COAL PLANTS- Paragraph
(1) of section 45(a) (relating to general rule) is amended by inserting `(1.0
cents in the case of electricity produced from biomass, other than closed loop
biomass, co-fired in a facility which produces electricity from coal) after
`1.5 cents.'
(d) COORDINATION WITH OTHER CREDITS- Section 45(d) (relating to
definitions and special rules) is amended by adding at the end the
following:
`(8) COORDINATION WITH OTHER CREDITS- This section shall not apply to
any production with respect to which the clean coal technology production
credit under section 45(b) is allowed unless the taxpayer elects to waive
the application of such credit to such production.'
(e) EFFECTIVE DATE- The amendments made by this section shall apply to
electricity produced after December 31, 2000.
SEC. 802. CREDIT FOR CAPITAL COSTS OF QUALIFIED BIOMASS-BASED GENERATING
SYSTEM.
(a) ALLOWANCE OF QUALIFIED BIOMASS-BASED GENERATING SYSTEM FACILITY
CREDIT- Section 46 (relating to amount of credit), as amended by section
501(a), is amended by striking `and' at the end of paragraph (3), by striking
the period at the end of paragraph (4) and inserting `, and', and by adding at
the end the following:
`(5) the qualified biomass-based generating system facility
credit.'
(b) AMOUNT OF CREDIT- Subpart E of part IV of subchapter A of chapter 1
(relating to rules for computing investment credit), as amended by section
501(b), is amended by inserting after section 48C the following:
SEC. 48C. Qualified biomass-based generating system facility
credit.
`(a) IN GENERAL- For purposes of section 46, the qualified biomass-based
generating system facility credit for any taxable year is an amount equal to
20 percent of the qualified investment in a qualified biomass-based generating
system facility for such taxable year.
`(b) Qualified Biomass-Based Generating System Facility-
`(1) IN GENERAL- For purposes of subsection (a), the term `qualified
biomass-based generating system facility' means a facility of the
taxpayer--
`(A)(i) the original use of which commences with the taxpayer or the
reconstruction of which is completed by the taxpayer (but only with
respect to that portion of the basis which is properly attributable to
such reconstruction), or
`(ii) that is acquired through purchase (as defined by section
179(d)(2)),
`(B) that is depreciable under section 167,
`(C) that has a useful life of not less than 4 years, and
`(D) that uses a qualified biomass-based generating system.
`(2) SPECIAL RULE FOR SALE-LEASEBACKS- For purposes of subparagraph (A)
of paragraph (1), in the case of a facility that--
`(A) is originally placed in service by a person, and
`(B) is sold and leased back by such person, or is leased to such
person, within 3 months after the date such facility was originally placed
in service, for a period of not less than 12 years, such facility shall be
treated as originally placed in service not earlier than the date on which
such property is used under the leaseback (or lease) referred to in
subparagraph (B). The preceding sentence shall not apply to any property
if the lessee and lessor of such property make an election under this
sentence. Such an election, once made, may be revoked only with the
consent of the Secretary.
`(3) QUALIFIED BIOMASS-BASED GENERATING SYSTEM- For purposes of
paragraph (1)(D), the term `qualified biomass-based generating system' means
a biomass-based integrated gasification combined cycle (IGCC) generating
system which has an electricity-only generation efficiency greater than 40
percent.
`(c) QUALIFIED INVESTMENT- For purposes of subsection (a), the term
`qualified investment' means, with respect to any taxable year, the basis of a
qualified biomass-based generating system facility placed in service by the
taxpayer during such taxable year.
`(d) Qualified Progress Expenditures-
`(1) INCREASE IN QUALIFIED INVESTMENT- In the case of a taxpayer who has
made an election under paragraph (5), the amount of the qualified investment
of such taxpayer for the taxable year (determined under subsection (c)
without regard to this section) shall be increased by an amount equal to the
aggregate of each qualified progress expenditure for the taxable year with
respect to progress expenditure property.
`(2) PROGRESS EXPENDITURE PROPERTY DEFINED- For purposes of this
subsection, the term `progress expenditure property' means any property being
constructed by or for the taxpayer and which--
`(A) cannot reasonably be expected to be completed in less than 18
months, and
`(B) it is reasonable to believe will qualify as a qualified
biomass-based generating system facility which is being constructed by or
for the taxpayer when it is placed in service.
`(3) QUALIFIED PROGRESS EXPENDITURES DEFINED- For purposes of this
subsection--
`(A) SELF-CONSTRUCTED PROPERTY- In the case of any self-constructed
property, the term `qualified progress expenditures' means the amount
which, for purposes of this subpart, is properly chargeable (during such
taxable year) to capital account with respect to such property.
`(B) NON-SELF-CONSTRUCTED PROPERTY- In the case of
non-self-constructed property, the term `qualified progress expenditures'
means the amount paid during the taxable year to another person for the
construction of such property.
`(4) OTHER DEFINITIONS- For purposes of this subsection--
`(A) SELF-CONSTRUCTED PROPERTY- The term `self-constructed property'
means property for which it is reasonable to believe that more than half
of the construction expenditures will be made directly by the
taxpayer.
`(B) NON-SELF-CONSTRUCTED PROPERTY- The term `non-self-constructed
property' means property which is not self-constructed property.
`(C) CONSTRUCTION, ETC.- The term `construction' includes
reconstruction and erection, and the term `constructed' includes
reconstructed and erected.
`(D) ONLY CONSTRUCTION OF QUALIFIED BIOMASS-BASED GENERATING SYSTEM
FACILITY TO BE TAKEN INTO ACCOUNT- Construction shall be taken into
account only if, for purposes of this subpart, expenditures therefor are
properly chargeable to capital account with respect to the
property.
`(5) ELECTION- An election under this subsection may be made at such
time and in such manner as the Secretary may by regulations prescribe. Such
an election shall apply to the taxable year for which made and to all
subsequent taxable years. Such an election, once made, may not be revoked
except with the consent of the Secretary.
`(e) COORDINATION WITH OTHER CREDITS- This section shall not apply to any
property with respect to which the rehabilitation credit under section 47 or
the energy credit under section
48A is allowed unless the taxpayer elects to waive the application of such
credits to such property.'.
(c) RECAPTURE- Section 50(a) (relating to other special rules), as amended
by section 501(c), is amended by adding at the end the following:
`(7) SPECIAL RULES RELATING TO QUALIFIED BIOMASS-BASED GENERATING SYSTEM
FACILITY- For purposes of applying this subsection in the case of any credit
allowable by reason of section 48C, the following shall apply:
`(A) GENERAL RULE- In lieu of the amount of the increase in tax under
paragraph (1), the increase in tax shall be an amount equal to the
investment tax credit allowed under section 38 for all prior taxable years
with respect to a qualified biomass-based generating system facility (as
defined by section 48C(b)) multiplied by a fraction whose numerator is the
number of years remaining to fully depreciate under this title the
qualified biomass-based generating system facility disposed of, and whose
denominator is the total number of years over which such facility would
otherwise have been subject to depreciation. For purposes of the preceding
sentence, the year of disposition of the qualified biomass-based
generating system facility shall be treated as a year of remaining
depreciation.
`(B) PROPERTY CEASES TO QUALIFY FOR PROGRESS EXPENDITURES- Rules
similar to the rules of paragraph (2) shall apply in the case of qualified
progress expenditures for a qualified biomass-based generating system
facility under section 48C, except that the amount of the increase in tax
under subparagraph (A) of this paragraph shall be substituted in lieu of
the amount described in such paragraph (2).
`(C) APPLICATION OF PARAGRAPH- This paragraph shall be applied
separately with respect to the credit allowed under section 38 regarding a
qualified biomass-based generating system facility.'.
(d) TRANSITIONAL RULE- Section 39(d) of the Internal Revenue Code of 1986
(relating to transitional rules), as amended by section 501(d), is amended by
adding at the end the following:
`(11) NO CARRYBACK OF SECTION 48C CREDIT BEFORE EFFECTIVE DATE- No
portion of the unused business credit for any taxable year which is
attributable to the qualified biomass-based generating system facility
credit determined under section 48C may be carried back to a taxable year
ending before the date of the enactment of section 48C.'.
(e) TECHNICAL AMENDMENTS-
(1) Section 49(a)(1)(C), as amended by section 501(e), is amended by
striking `and' at the end of clause (iii), by striking the period at the end
of clause (iv) and inserting `, and', and by adding at the end the
following:
`(v) the portion of the basis of any qualified biomass-based
generating system facility attributable to any qualified investment (as
defined by section 48C(c)).'.
(2) Section 50(a)(4), as amended by section 501(e), is amended by
striking `and (6)' and inserting `, (6), and (7)'.
(3) The table of sections for subpart E of part IV of subchapter A of
chapter 1, as amended by section 501(e), is amended by inserting after the
item relating to section 48B the following:
`Sec. 48C. Qualified biomass-based generating system facility
credit.'.
(f) EFFECTIVE DATE- The amendments made by this section shall apply to
periods after December 31, 1999, 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 Reconciliation Act of 1990).
SEC. 803. TREATMENT OF FACILITIES USING BAGASSE TO PRODUCE ENERGY AS SOLID
WASTE DISPOSAL FACILITIES ELIGIBLE FOR TAX-EXEMPT FINANCING.
(a) IN GENERAL- Section 142 (relating to exempt facility bond) is amended
by adding at the end the following:
`(k) SOLID WASTE DISPOSAL FACILITIES- For purposes of subsection (a)(6),
the term `solid waste disposal facilities' includes property located in Hawaii
and used for the collection, storage, treatment, utilization, processing, or
final disposal of bagasse in the manufacture of ethanol.'.
(b) EFFECTIVE DATE- The amendment made by this section shall apply to
bonds issued after the date of the enactment of this Act.
SEC. 804. FEDERAL RENEWABLE PORTFOLIO STANDARD.
Title VI of the Public Utility Regulatory Policies Act of 1978 is further
amended by adding at the end the following:
`SEC. 610. FEDERAL RENEWABLE PORTFOLIO STANDARD.
`(a) MINIMUM RENEWABLE GENERATION REQUIREMENT- For each calendar year
beginning with 2003, a retail electric supplier shall submit to the Secretary
renewable energy credits in an amount equal to the required annual percentage,
specified in subsection (b), of the total electric energy sold by the retain
electric supplier to electric consumers in the calendar year. The retail
electric supplier shall make this submission before April 1 of the following
calendar year.
`(b) REQUIRED ANNUAL PERCENTAGE-
`(1) For calendar years 2003 and 2004, the required annual percentage
shall determined by the Secretary in an amount less than the amount in
paragraph (2);
`(2) For calendar years 2005 through 2015, the required annual
percentage shall be determined by the Secretary, but no less than 2.5
percent of the retail electric supplier's base amount by the year 2007
increasing to 5.0 percent by the year 2012 continuing through 2015.
`(c) SUBMISSION OF CREDITS- (1) A retail electric supplier may satisfy the
requirements of subsection (a) through the submission of--
`(A) renewable energy credits issued under subsection (d) for renewable
energy generated by the retail electric supplier in the calendar year for
which credits are being submitted or any previous calendar year;
`(B) renewable energy credits obtained by purchase or exchange under
subsection (e);
`(C) renewable energy credits borrowed against future years under
subsection (f); or
`(D) any combination of credits under subparagraphs (A), (B), and
(C).
`(2) A credit may be counted toward compliance with subsection (a) only
once.
`(d) ISSUANCE OF CREDITS- (1) The Secretary shall establish, not later
than one year after the date of enactment of this section, a program to issue,
monitor the sale or exchange of, and track renewable energy credits.
`(2) Under the program, an entity that generates electric energy through
the use of a renewable energy resource may apply to the Secretary for the
issuance of renewable energy credits. The application shall indicate--
`(A) the type of renewable energy resource used to produce the
electricity,
`(B) the State in which the electric energy was produced, and
`(C) any other information the Secretary determines appropriate.
`(3)(A) Except as provided in paragraphs (B) and (C), the Secretary shall
issue to an entity one renewable energy credit for each kilowatt-hour of
electric energy the entity generates through the use of a renewable energy
resource in any State in 2001 and any succeeding year through 2015.
`(B) For incremental hydropower the credits shall be calculated based on
normalized water flows, and not actual generation. The calculation of the
credits for incremental hydropower shall not be based on any operational
changes at the hydroproject not directly associated with the efficiency
improvements or capacity additions.
`(C) The Secretary shall issue two renewable energy credits for each
kilowatt-hour of electric energy generated through the use of a renewable
energy resource in any State in 2001 and any succeeding year, if the
generating facility is located on Indian land. For purposes of this paragraph,
renewable energy generated by biomass cofired with other fuels is eligible for
two credits only if the biomass was grown on the land eligible under this
paragraph.
`(D) To be eligible for a renewable energy credit, the unit of electricity
generated through the use of a renewable energy resource may be sold or may be
used by the generator. If both a renewable energy resource and a non-renewable
energy resource are used to generate the electric energy, the Secretary shall
issue credits based on the proportion of the renewable energy source used. The
Secretary shall identify renewable energy credits by type of generation and by
the State in which the generating facility is located.
`(4) In order to receive a renewable energy credit, the recipient of a
renewable energy credit shall pay a fee, calculated by the Secretary, in an
amount that is equal to the administrative costs of issuing, recording,
monitoring the sale or exchange of, and tracking the credit or does not exceed
five percent of the dollar value of the credit, whichever is lower. The
Secretary shall retain the fee and use it to pay these administrative
costs.
`(5) When a generator sells electric energy generated through the use of a
renewable energy resource to a retail electric supplier under a contract
subject to section 210 of this Act, the retail electric supplier is treated as
the generator of the electric energy for the purposes of this section for the
duration of the contract.
`(e) CREDIT TRADING- A renewable energy credit may be sold or exchanged by
the entity to whom issued or by any other entity who acquires the credit. A
renewable energy credit for any year that is not used to satisfy the minimum
renewable generation requirement of subsection (a) for that year may be
carried forward for use in another year.
`(f) CREDIT BORROWING- At any time before the end of the calendar year, a
retail electric supplier that has reason to believe that it will not have
sufficient renewable energy credits to comply with subsection (a) may--
`(1) submit a plan to the Secretary demonstrating that the retail
electric supplier will earn sufficient credits within the next 3 calendar
years which, when taken into account, will enable the retail electric
supplier to meet the requirements of subsection (a) for the calendar year
involved; and
`(2) upon the approval of the plan by the Secretary, apply credits that
the plan demonstrates will be earned within the next 3 calendar years to
meet the requirements of subsection (a) for the calendar year
involved.
`(g) ENFORCEMENT- The Secretary may bring an action in the appropriate
United States district court to impose a civil penalty on a retail supplier
that does not comply with subsection (a). A retail electric supplier who does
not submit the required number of renewable energy credits under subsection
(a) is subject to a civil penalty of not more than 3 cents each for the
renewable energy credits not submitted.
`(h) INFORMATION COLLECTION- The Secretary may collect the information
necessary to verify and audit--
`(1) the annual electric energy generation and renewable energy
generation of any entity applying for renewable energy credits under this
section,
`(2) the validity of renewable energy credits submitted by a retail
electric supplier to the Secretary, and
`(3) the quantity of electricity sales of all retail electric
suppliers.
`(i) ENVIRONMENTAL SAVINGS CLAUSE- Incremental hydropower shall be subject
to all applicable environmental laws and licensing and regulatory
requirements.
`(j) EXEMPTION FOR ALASKA AND HAWAII- This section shall not apply to any
retail electric supplier in Alaska or Hawaii.
`(k) STATE SAVINGS CLAUSE- This section does not preclude a State from
requiring additional renewable energy generation in that State.
`(l) DEFINITIONS- For purposes of this section--
`(1) The term `incremental hydropower' means additional generation
capacity achieved from increased efficiency or additions of new capacity at
an existing hydroelectric dam.
`(2) The term `Indian land' means--
`(A) any land within the limits of any Indian reservation, pueblo or
rancheria,
`(B) any land not within the limits of any Indian reservation, pueblo
or rancheria title to which was on the date of enactment of this paragraph
either held by the United States for the benefit of any Indian tribe or
individual or held by any Indian tribe or individual subject to
restriction by the United States against alienation,
`(C) any dependent Indian community, and
`(D) any land conveyed to any Alaska Native corporation under the
Alaska Native Claims Settlement Act.
`(3) The term `Indian tribe' means any Indian tribe, band, nation, or
other organized group or community, including any Alaska Native village or
regional or village corporation as defined in or established pursuant to the
Alaska Native Claims Settlement Act (43 U.S.C. 1601 et seq.), which is
recognized as eligible for the special programs and services provided by the
United States to Indians because of their status as Indians.
`(4) The term `renewable energy' means electric energy generated by a
renewable energy resource.
`(5) The term `renewable energy resource' means solar thermal,
photovoltaic, wind, geothermal, biomass (including organic waste, but not
unsegregated municipal solid waste), or incremental hydropower facility or
modification to an existing facility to co-fire biomass or to expand
electricity production from an existing renewable facility that is placed in
service on or after January 1, 2001.
`(6) The term `retail electric supplier' means a person, State agency,
or Federal agency that sells electric energy to an electric consumer.
`(7) The term `retail electric supplier's base amount' means the total
amount of electric energy sold by the retail electric supplier to electric
customers during the most recent calendar year for which information is
available, excluding electric energy generated by solar energy, wind,
geothermal, biomass, or hydroelectric facility placed in service prior to
January 1, 2001.
`(m) SUNSET- Subsection (a) of this section expires December 31,
2015.'.
TITLE IX--STEELMAKING
SEC. 901. EXTENSION OF CREDIT FOR ELECTRICITY TO PRODUCTION FROM STEEL
CONGENERATION.
(a) EXTENSION OF CREDIT FOR COKE PRODUCTION AND STEEL MANUFACTURING
FACILITIES- Section 45(c)(1) (defining qualified energy resources), as amended
by section 507 of Public Law 106-170, is amended by striking `and' at the end
of subparagraph (B), by striking the period at the end of subparagraph (C) and
inserting `, and', and by adding at the end the following:
`(E) steel congeneration.'.
(b) STEEL COGENERATION- Section 45(c), is amended by adding at the end the
following:
`(5) STEEL COGENERATION- The term `steel cogeneration' means the
production of electricity and steam (or other form of thermal energy) from
any or all waste sources in subparagraphs (A), (B), and (C) within an
operating facility that produces or integrates the production of coke,
direct reduced iron ore, iron, or steel provided that the cogeneration meets
any regulatory energy-efficiency standards established by the Secretary, and
only to the extent that such energy is produced from--
`(A) gases or heat generated from the production of metallurgical
coke,
`(B) gases or heat generated from the production of direct reduced
iron ore or iron, from blast furnace or direct ironmaking processes,
or
`(C) gases or heat generated from the manufacture of steel.'.
(c) MODIFICATION OF PLACED IN SERVICE RULES FOR STEEL COGENERATION
FACILITIES- Section 45(c)(4) (defining qualified facility), as amended by
section 507 of Public Law 106-170, is amended by adding at the end the
following:
`(F) STEEL COGENERATION FACILITIES- In the case of a facility using
steel cogeneration to produce electricity, the term `qualified facility'
means any facility permitted to operate under the environmental
requirements of the Clean Air Act Amendments of 1990 which is owned by the
taxpayer and originally placed in service after December 31, 2000, and
before January 1, 2006. Such a facility may be treated as originally
placed in service when such facility was last upgraded to increase
efficiency or generation capability. However, no facility shall be allowed
a credit under this section for more than 10 years of
production.'.
(d) Conforming Amendments-
(1) The heading for section 45 is amended by inserting `and waste
energy' after `renewable'.
(2) The item relating to section 45 in the table of sections subpart D
of part IV of subchapter A of chapter 1 is amended by inserting `and waste
energy' after `renewable'.
(e) EFFECTIVE DATE- The amendments made by this section shall apply to
taxable years beginning after December 31, 2001.
TITLE X--ENERGY EMERGENCIES
SEC. 1001. ENERGY POLICY AND CONSERVATION ACT AMENDMENTS.
(a) Title I of the Energy Policy and Conservation Act (42 U.S.C.
6211-6251) is amended--
(1) in section 166 (42 U.S.C. 6246), by inserting `through 2003' after
`2000.'
(2) in section 181 (42 U.S.C. 6251), by striking `March 31, 2000' each
place it appears and inserting `September 30, 2003'.
(b) Title II of the Energy Policy and Conservation Act (42 U.S.C.
6261-6285) is amended--
(1) in section 256(h) (42 U.S.C. 6276(h)), by striking the last sentence
and inserting the following, `For the purpose of carrying out this
subsection, there are authorized to be appropriated such sums as may be
necessary.'.
(2) in section 281 (42 U.S.C. 6285), by striking `March 31, 2000' each
place it appears and inserting `September 30, 2003'.
(c) AMENDMENT- Title I of the Energy Policy and Conservation Act is
amended by--
(1) redesignating part D as part E;
(2) redesignating section 181 as section 191; and
(3) inserting after part C the following new part D:
`PART D--NORTHEAST HOME HEATING OIL RESERVE
`ESTABLISHMENT
`SEC. 181. (a) Notwithstanding any other provision of this Act, the
Secretary may establish, maintain, and operate in the Northeast a Northeast
Home Heating Oil Reserve. A Reserve established under this part is not a
component of the Strategic Petroleum Reserve established under part B of this
title. A Reserve established under this part shall contain no more than 2
million barrels of petroleum distillate.
`(b) For the purposes of this part--
`(1) the term `Northeast' means the States of Maine, New Hampshire,
Vermont, Massachusetts, Connecticut, Rhode Island, New York, Pennsylvania,
and New Jersey; and
`(2) the term `petroleum distillate' includes heating oil and diesel
fuel.
`AUTHORITY
`SEC. 182. To the extent necessary or appropriate to carry out this part,
the Secretary may--
`(1) purchase, contract for, lease, or otherwise acquire, in whole or in
part, storage and related facilities, and storage services;
`(2) use, lease, maintain, sell, or otherwise dispose of storage and
related facilities acquired under this part;
`(3) acquire by purchase, exchange (including exchange of petroleum
product from the Strategic Petroleum Reserve or received as royalty from
Federal lands), lease, or otherwise, petroleum distillate for storage in the
Northeast Home Heating Oil Reserve;
`(4) store petroleum distillate in facilities not owned by the United
States;
`(5) sell, exchange, or otherwise dispose of petroleum distillate from
the Reserve established under this part; including to maintain the quality
or quantity of the petroleum distillate in the Reserve or to maintain the
operational capability of the Reserve.
`CONDITIONS FOR RELEASE; PLAN
`SEC. 183. The Secretary may drawdown the Reserve only upon a finding by
the President that there is a severe energy supply interruption. A `severe
energy supply interruption' may be deemed to exist--
`(1) if the President determines that a severe increase in the price of
heating oil has resulted from such emergency situation;
`(2) if the President finds that (1) a circumstance, other than that
described in subsection (a) exists that constitutes a regional supply
shortage of significant scope or duration; and (2) action taken under this
subsection would assist directly and significantly in reducing the adverse
impact of such shortage.
`(3) DEFINITION- For purposes of this section `severe increase in the
price of heating oil' means--
`(A) the price differential between crude oil, as reflected in the
spot price from a published index, and No. 2 heating oil, as reported in
the Energy Information Administration's retail price data for the
Northeast, increases by more than 50 percent over its
five year seasonal rolling average, and continues for 10 consecutive days;
and
`(B) The price differential continues to increase during the most
recent week for which price information is available.
`(4) The Secretary shall conduct a continuing evaluation of the
residential price data supplied by the Energy Information Administration for
the Northeast and data on crude oil prices from published sources.
`(5) After consultation with the heating oil industry, the Secretary
shall determine procedures to be used during a drawdown of the Reserve. The
procedures shall ensure that:
`(A) the petroleum distillate is sold through a competitive process;
and
`(B) in all sales or exchanges, the Secretary receives revenue or its
equivalent in petroleum distillate that provides the Department with full
market value.
`(6) Within 45 days of the date of the enactment of this section, the
Secretary shall transmit to the President and, if the President approves, to
the Congress a plan describing--
`(A) the acquisition of storage and related facilities or storage
services for the Reserve;
`(B) the acquisition of petroleum distillate for storage in the
Reserve;
`(C) the anticipated methods of disposition of petroleum distillate
from the Reserve; and
`(D) the estimated costs of establishment, maintenance, and operation
of the Reserve.
`NORTHEAST HOME HEATING OIL RESERVE ACCOUNT
`SEC. 184. (a) Upon a decision of the Secretary of Energy to establish a
Reserve under this part, the Secretary of the Treasury shall establish in the
Treasury of the United States an account known as the `Northeast Home Heating
Oil Reserve Account' (referred to in this section as the `Account').
`(b) The Secretary of the Treasury shall deposit in the Account any
amounts appropriated to the Account and any receipts from the sale, exchange,
or other disposition of petroleum distillate from the Reserve.
`(c) The Secretary of Energy may obligate amounts in the Account to carry
out activities under this part without the need for further appropriation, and
amounts available to the Secretary of Energy for obligation under this section
shall remain available without fiscal year limitation.
`EXEMPTIONS
`SEC. 185. An action taken under this part is not subject to the
rulemaking requirements of section 523 of this Act, section 501 of the
Department of Energy Organization Act, or section 553 of title 5, United
States Code; and
`(b) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be
appropriated such sums as may be necessary to carry out part D of title I of
the Energy Policy and Conservation Act.'.
SEC. 1002. ENERGY CONSERVATION PROGRAMS FOR SCHOOLS AND HOSPITALS.
Title III of the Energy Policy and Conservation Act (42 U.S.C. 6325) is
amended as follows:
`SEC. 365 (f). For the purpose of carrying out this part there are
authorized to be appropriated such sums as may be necessary.'.
SEC. 1003. STATE ENERGY PROGRAMS.
Title III of the Energy Policy and Conservation Act (42 U.S.C. 6371f) is
amended as follows:
`SEC. 397. For the purpose of carrying out this part, there are authorized
to be appropriated such sums as may be necessary.
SEC. 1004. ANNUAL HOME HEATING READINESS PROGRAM.
(a) IN GENERAL- Part A of title I of the Energy Policy and Conservation
Act (42 U.S.C. 6211 et seq.) is amended by adding at the end the following:
`ANNUAL HOME HEATING READINESS
`(a) IN GENERAL- The Secretary, in conjunction with the Administrator of
the Energy Information Agency, shall coordinate with all interested states on
an annual basis a program to assess the adequacy of supplies for natural gas,
heating oil and propane and develop joint recommendations for responding to
regional shortages or price spikes.
`(b) On or before September 1 of each year, the Secretary, acting through
the Administrator of the Energy Information Agency, shall submit to Congress a
Home Heating Readiness Report on the readiness of the natural gas, heating oil
and propane industries to supply fuel under various weather conditions,
including rapid decreases in temperature.
`(c) CONTENTS- The Home Heating Readiness Report shall include--
`(1) estimates of the consumption, expenditures, and average price per
MMBtu or gallon of natural gas, heating oil and propane for the upcoming
period of October through March for various weather conditions, with special
attention to extreme weather, and various regions of the country;
`(A) global and regional crude oil and refined product
supplies;
`(B) the adequacy and utilization of refinery capacity;
`(D) the refined product transportation system;
`(E) market inefficiencies; and
`(F) any other factor affecting the functional capability of the
natural gas, heating oil industry and propane industry that has the
potential to affect national or regional supplies and prices;
`(3) recommendations on steps that the Federal, State, and local
governments can take to prevent or alleviate the impact of sharp and
sustained increases in the price of natural gas, heating oil and propane;
and
`(4) recommendations on steps that companies engaged in the production,
refining, storage, transportation of heating oil or propane, or any other
activity related to the heating oil industry or propane industry, can take
to prevent or alleviate the impact of sharp and sustained increases in the
price of heating oil and propane.
`(d) INFORMATION REQUESTS- The Secretary may request information necessary
to prepare the Home Heating Readiness Report from companies described in
subsection (b)(4).'.
(b) CONFORMING AND TECHNICAL AMENDMENTS- The Energy Policy and
Conservation Act is amended--
(1) in the table of contents in the first section (42 U.S.C. prec.
6201), by inserting after the item relating to section 106 the
following:
`Sec. 107. Major fuel burning stationary source.
`Sec. 108. Annual home heating readiness report.'; and
(2) in section 107 (42 U.S.C. 6215), by striking `SEC. 107. (a) No
Governor' and inserting the following:
`SEC. 107. MAJOR FUEL BURNING STATIONARY SOURCE.
SEC. 1005. SUMMER FILL AND FUEL BUDGETING PROGRAMS.
(a) IN GENERAL- Part C of title II of the Energy Policy and Conservation
Act (42 U.S.C. 6211 et seq.) is amended by adding at the end the following:
`SEC. 273. SUMMER FILL AND FUEL BUDGETING PROGRAMS.
`(a) DEFINITIONS- In this section:
`(1) BUDGET CONTRACT- The term `budget contract' means a contract
between a retailer and a consumer under which the heating expenses of the
consumer are spread evenly over a period of months.
`(2) FIXED-PRICE CONTRACT- The term `fixed-price contract' means a
contract between a retailer and a consumer under which the retailer charges
the consumer a set price for propane, kerosene, or heating oil without
regard to market price fluctuations.
`(3) PRICE CAP CONTRACT- The term `price cap contract' means a contract
between a retailer and a consumer under which the retailer charges the
consumer the market price for propane, kerosene, or heating oil, but the
cost of the propane, kerosene, or heating oil may not exceed a maximum
amount stated in the contract.
`(b) ASSISTANCE- At the request of the chief executive officer of a State,
the Secretary shall provide information, technical assistance, and
funding--
`(1) to develop education and outreach programs to encourage consumers
to fill their storage facilities for propane, kerosene, and heating oil
during the summer months; and
`(2) to promote the use of budget contracts, price cap contracts,
fixed-price contracts, and other advantageous financial arrangements;
to avoid severe seasonal price increases for and supply shortages of those
products.
`(c) PREFERENCE- In implementing this section, the Secretary shall give
preference to States that contribute public funds or leverage private funds to
develop State summer fill and fuel budgeting programs.
`(d) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be
appropriated to carry out this section--
`(1) $25,000,000 for fiscal year 2001; and
`(2) such sums as are necessary for each fiscal year thereafter.
`(e) INAPPLICABILITY OF EXPIRATION PROVISION- Section 281 does not apply
to this section.'
(b) CONFORMING AMENDMENT- The table of contents in the first section of
the Energy Policy and Conservation Act (42 U.S.C. prec. 6201) is amended by
inserting after the item relating to section 272 the following:
`Sec. 273. Summer fill and fuel budgeting programs.'.
SEC. 1006. USE OF ENERGY FUTURES FOR FUEL PURCHASES.
(a) HEATING OIL STUDY- The Secretary shall conduct a study--
(1) to ascertain if the use of energy futures and options contracts
could provide cost-effective protection from sudden surges in the price of
heating oil (including number two fuel oil, propane, and kerosene) for
governments, consumer cooperatives, and other organizations that purchase
heating oil in bulk to market to end use consumers in the Northeast (Maine,
New Hampshire, Vermont, Massachusetts, Rhode Island, Connecticut, New York,
Pennsylvania, and New Jersey); and
(2) to ascertain how these entities may be most effectively educated in
the prudent use of energy futures and options contracts to maximize their
purchasing effectiveness, protect themselves against sudden or unanticipated
surges in the price of heating oil, and minimize long-term heating oil
costs.
(b) REPORT- The Secretary, no later than 180 days after appropriations are
enacted to carry out this Act, shall transmit the study required in this
section to the Committee on Energy and Commerce of the House of
Representatives and the Committee on Energy and Natural Resources of the
Senate. The report shall contain a review of prior studies conducted on the
subjects described in subsection (a).
(c) PILOT PROGRAM- If the study required in subsection (a) indicates that
futures and options contracts can provide cost-effective protection from
sudden surges in heating oil prices, the Secretary shall conduct a pilot
program, commencing not later than 30 days after the transmission of the study
required in subsection (b), to educate such governmental entities, consumer
cooperatives, and other organizations on the prudent and cost-effective use of
energy futures and options contracts to increase their protection against
sudden or unanticipated surges in the price of heating oil and increase the
efficiency of their heating oil purchase programs.
(d) AUTHORIZATION- There is authorized to be appropriated $3 million in
fiscal year 2001 to carry out this section.
SEC. 1007. INCREASED USE OF ALTERNATIVE FUELS BY FEDERAL FLEETS.
Title IV of the Energy Policy and Conservation Act (42 U.S.C. 6374) is
amended as follows: In Sec. 400AA(a)(3)(E), insert the following sentence at
the end, `Except that, no later than fiscal year 2003 at least 50 percent of
the total annual volume of fuel used must be from alternative fuels.', and in
Sec. 400AA(g)(4)(B), after the words, `solely on alternative fuel', insert the
words `, including a three wheeled enclosed electric vehicle having a VIN
number'.
SEC. 1008. FULL EXPENSING OF HOME HEATING OIL AND PROPANE STORAGE
FACILITIES.
(a) IN GENERAL- Section 179(b) of the Internal Revenue Code of 1986
(relating to limitations) is amended by adding at the end the following:
`(5) FULL EXPENSING OF HOME HEATING OIL AND PROPANE STORAGE FACILITIES-
Paragraphs (1) and (2) shall not apply to section 179 property which is any
storage facility (not including a building or its structural components)
used in connection with the distribution of home heating oil or liquefied
petroleum gas.'.
TITLE XI--ENERGY EFFICIENCY
SEC. 1101. ENERGY SAVINGS PERFORMANCE CONTRACTS.
(a) Section 801(a)(1) of the National Energy Conservation Policy Act (42
U.S.C. 8287(a)(1)) is amended by--
(1) inserting `and water' after `energy' the first place it
appears;
(2) striking `that purpose' and inserting `these purposes';
(3) inserting `or water' after `energy' the second place it
appears;
(4) inserting `or water conservation' after `energy' the third place it
appears; and
(5) inserting `or water' after `energy' the fourth place it
appears.
(b) Section 801(a)(2)(A) of the National Energy Conservation Policy Act
(42 U.S.C. 8287(a)(2)(A)) is amended by--
(1) inserting `or water' after `energy' the first place it appears;
and
(2) inserting `or water conservation' after `energy' the next two places
it appears.
(c) Section 801(a)(2)(B) of the National Energy Conservation Policy Act
(42 U.S.C. 8287(a)(2)(B)) is amended by--
(1) inserting `or water' after `energy' each place it appears; and
(2) inserting `energy or' before `utilities' the second place it
appears.
(d) Section 801(a)(2)(D)(iii) of the National Energy Conservation Policy
Act (42 U.S.C. 8287(a)(2)(D)) is amended by striking `$750,000' and inserting
`$10,000,000'.
(e) Section 801(b)(1)(A) of the National Energy Conservation Policy Act
(42 U.S.C. 8287(b)(1)(B)) is amended by inserting `and water' after
`energy'.
(f) Section 801(b)(1)(B) of the National Energy Conservation Policy Act
(42 U.S.C. 8287(b)(1)(B)) is amended by--
(1) inserting `or water' after `energy' the first place it appears;
and
(2) inserting `or water' after `energy' the second place it
appears.
(g) Section 801(b)(2)(A) of the National Energy Conservation Policy Act
(42 U.S.C. 8287(b)(2)(A)) is amended by inserting `or water' after `energy'
each place it appears.
(h) Section 801(b)(2)(C) of the National Energy Conservation Policy Act
(42 U.S.C. 8287(b)(2)(C)) is amended by inserting `or water' after `energy'
each place it appears.
(i) Section 801(b)(3) of the National Energy Conservation Policy Act (42
U.S.C. 8287(b)(3)) is amended by inserting `or water' after `energy'.
(j) Section 801(c)(1) of the National Energy Conservation Policy Act (42
U.S.C. 8287(c)(1)) is repealed.
(k) Section 801(c)(2) of the National Energy Conservation Policy Act (42
U.S.C. 8287(c)) is amended by inserting `or water' after `energy' each place
it appears.
(l) Section 802 of the National Energy Conservation Policy Act (42 U.S.C.
8287a.) is amended by inserting `and water' after `energy'.
(m) Section 803 of the National Energy Conservation Policy Act (42 U.S.C.
8287b.) is amended by inserting `and water' after `energy'.
(n) Section 804(2) of the National Energy Conservation Policy Act (42
U.S.C. 8287c.(2)) is amended in paragraph (a)(2) by inserting `or water' after
`energy' each place it appears.
(o) Section 804(3) of the National Energy Conservation Policy Act (42
U.S.C. 8287c.(3)) is amended in paragraph (a)(3) by inserting `or water' after
`energy'.
(p) Section 804(4) of the National Energy Conservation Policy Act (42
U.S.C. 8287c.(3)) is amended to read as follows:
`(4) The term `energy or water conservation measure' includes an `energy
conservation measure' as defined in section 551(4), or a `water conservation
measure,' which is a measure applied to a Federal building that improves
water efficiency, is life cycle cost effective, and involves water
conservation, water recycling or reuse, improvements in operation or
maintenance efficiencies, retrofit activities or other related
activities.'.
(q) The seventh paragraph under the heading `Administrative Provisions,
Department of Energy,' in title II of the Act Making Appropriation for the
Department of the Interior and Related Agencies for the Fiscal Year Ending
September 30, 1999 is amended by inserting `and water' after `energy' each
place it appears.
(r) Section 101(e) of Public Law 105-277 is amended by--
(1) inserting `and water conservation' after `efficiency' in the title;
and
(2) inserting `and water' after `energy' each place it appears.
SEC. 1102. WEATHERIZATION.
(a) Section 414 of the Energy and Conservation and Production Act (42
U.S.C. 6865) is amended by inserting the following sentence in subsection (a):
`The application shall contain the state's best estimate of matching funding
available from state and local governments and from private sources,' after
the words `assistance to such persons'. And, by inserting the words, `without
regard to availability of matching funding', after the words `low-income
persons throughout the States,'.
(b) Section 415 of the Energy and Conservation and Production Act (42
U.S.C. 6865) is amended--
(1) in subsection (a)(1) by striking the first sentence;
(2) in subsection (a)(2) by--
(B) striking `approve a State's application to waive the 40 percent
requirement established in paragraph (1) if the State includes in its
plan' and inserting `establish', and
(C) striking subparagraph (B);
(3) in subsection (c)(1) by--
(A) striking `paragraphs (3) and (4)' and inserting `paragraph
(3)',
(B) striking `$1600' and inserting `$2500',
(C) striking `and' at the end of subparagraph (C),
(D) striking the period and inserting `; and' in subparagraph (D),
and
(E) inserting after subparagraph (D) the following new subparagraph:
`(E) the cost of making heating and cooling modifications, including
replacement.';
(4) in subsection (c)(3) by--
(A) striking `1991, the $1600 per dwelling unit limitation' and
inserting `2000, the $2500 per dwelling unit average',
(B) striking `limitation' and inserting `average' each time it
appears, and
(C) inserting `the' after `beginning of' in subparagraph (B);
and
(5) by striking subsection (c)(4).
SEC. 1103. PUBLIC BENEFITS FUND.
(a) DEFINITIONS- For purposes of this section--
(1) the term `eligible public purpose program' means a State or tribal
program that--
(A) assists low-income households in meeting their home energy
needs;
(B) provides for the planning, construction, or improvement of
facilities to generate, transmit, or distribute electricity to Indian
tribes or rural and remote communities;
(C) provides for the development and implementation of measures to
reduce the demand for electricity; or
(i) new or additional capacity, or improves the efficiency of
existing capacity, from a wind, biomass, geothermal, solar thermal,
photovoltaic, combined heat and power energy source, or
(ii) additional generating capacity achieved from increased
efficiency at existing hydroelectric dams or additions of new capacity
at existing hydroelectric dams;
(2) the term `fiscal agent' means the entity designated under subsection
(b)(2)(B);
(3) the term `Fund' means the Public Benefits Fund established under
subsection (b)(2)(A);
(4) the term `Indian tribe' means any Indian tribe, band, nation, or
other organized group or community, including any Alaska Native village or
regional or village corporation as defined in or established pursuant to the
Alaska Native Claims Settlement Act (43 U.S.C. 1601 et seq.), which is
recognized as eligible for the special programs and services provided by the
United States to Indians because of their status as Indians; and
(5) the term `State' means each of the States and the District of
Columbia.
(b) PUBLIC BENEFITS FUND- There is established in the Treasury of the
United States a separate fund, to be known as the Public Benefits Fund. The
Fund shall consist of amounts collected by the fiscal agent under subsection
(e). The fiscal agent may disburse amounts in the Fund, without further
appropriation, in accordance with this section.
(c) FISCAL AGENT- The Secretary shall appoint a fiscal agent shall collect
and disburse the amounts in the Fund in accordance with this section.
(d) SECRETARY- The Secretary shall prescribe rules for:
(1) the determination of charges under subsection (e);
(2) the collection of amounts for the Fund, including provisions for
overcollection or undercollection;
(3) the equitable allocation of the Fund among States and Indian tribes
based upon--
(A) the number of low-income households in such State or tribal
jurisdiction; and
(B) the average annual cost of electricity used by households in such
State or tribal jurisdiction; and
(4) the criteria by which the fiscal agent determines whether a State or
tribal government's program is an eligible public purpose program.
(e) PUBLIC BENEFITS CHARGE- (1) As a condition of existing or future
interconnection with facilities of any transmitting utility, each owner of an
electric generating facility whose nameplate capacity exceeds five megawatts
shall pay the transmitting utility a public benefits charge determined under
paragraph (2), even if the generation facility and the transmitting facility
are under common ownership or are otherwise affiliated. Each importer of
electric energy from Canada or Mexico, as a condition of existing or future
interconnection with facilities of any transmitting utility in the United
States, shall pay this same charge for imported electric energy. The
transmitting utility
common ownership or are otherwise affiliated. Each importer of electric
energy from Canada or Mexico, as a condition of existing or future
interconnection with facilities of any transmitting utility in the United
States, shall pay this same charge for imported electric energy. The
transmitting utility shall pay the amounts collected to the fiscal agent at the
close of each month, and the fiscal agent shall deposit the amounts into the
Fund as offsetting collections.
(2)(A) The Commission shall calculate the rate for the public benefits
charge for each calendar year at an amount--
(i) equal to $3 billion per year, divided by the estimated kilowatt
hours of electric energy to be generated by generators subject to the
charge, but
(ii) not to exceed 1 mill per kilowatt-hour.
(B) Amounts collected in excess of $3 billion in a fiscal year shall be
retained in the fund and the assessment in the following year shall be reduced
by that amount.
(f) Disbursal From the Fund-
(1) The fiscal agent shall disburse amounts in the Fund to participating
States and tribal governments as a block grant to carry out eligible public
purpose programs in accordance with this subsection and rules prescribed
under subsection (d).
(2)(A) The fiscal agent shall disburse amounts for a calendar year from
the Fund to a State or tribal government in twelve equal monthly payments
beginning two months after the beginning of the calendar year.
(B) The fiscal agent shall make distributions to the State or tribal
government or to an entity designated by the State or tribal government to
receive payments. The State or tribal government may designate a
nonregulated utility as an entity to receive payments under this
section.
(C) A State or tribal government may use amounts received only for the
eligible public purpose programs the State or tribal government designated
in its submission to the fiscal agent and the fiscal agent determined
eligible.
(g) REPORT- One year before the date of expiration of this section, the
Secretary shall report to Congress whether a public benefits fund should
continue to exist.
(h) SUNSET- This section expires at midnight on December 31, 2015.'.
SEC. 1104. NATIONAL OIL HEAT RESEARCH ALLIANCE ACT DEFINITIONS.
(1) ALLIANCE- The term `Alliance' means a national oilheat research
alliance established under section 104.
(2) CONSUMER EDUCATION- The term `consumer education' means the
provision of information to assist consumers and other persons in making
evaluations and decisions regarding oilheat and other nonindustrial
commercial or residential space or hot water heating fuels.
(3) EXCHANGE- The term `exchange' means an agreement that--
(A) entitles each party or its customers to receive oilheat from the
other party; and
(B) requires only an insubstantial portion of the volumes involved in
the exchange to be settled in cash or property other than the
oilheat.
(4) INDUSTRY TRADE ASSOCIATION- The term `industry trade association'
means an organization described in paragraph (3) or (6) of section 501(c) of
the Internal Revenue Code of 1986 that is exempt from taxation under section
501(a) of that Code and is organized for the purpose of representing the
oilheat industry.
(5) NO. 1 DISTILLATE- The term `No. 1 distillate' means fuel oil
classified as No. 1 distillate by the American Society for Testing and
Materials.
(6) NO. 2 DYED DISTILLATE- The term `No. 2 dyed distillate' means fuel
oil classified as No. 2 distillate by the American Society for Testing and
Materials that is indelibly dyed in accordance with regulations prescribed
by the Secretary of the Treasury under section 4082(a)(2) of the Internal
Revenue Code of 1986.
(7) OILHEAT- The term `oilheat' means--
(A) No. 1 distillate; and
(B) No. 2 dyed distillate;
that is used as a fuel for nonindustrial commercial or residential space
or hot water heating.
(A) IN GENERAL- The term `oilheat industry' means--
(i) persons in the production, transportation, or sale of oilheat;
and
(ii) persons engaged in the manufacture or distribution of oilheat
utilization equipment.
(B) EXCLUSION- The term `oilheat industry' does not include ultimate
consumers of oilheat.
(9) PUBLIC MEMBER- The term `public member' means a member of the
Alliance described in section 105(c)(1)(F).
(10) QUALIFIED INDUSTRY ORGANIZATION- The term `qualified industry
organization' means the National Association for Oilheat Research and
Education or a successor organization.
(11) QUALIFIED STATE ASSOCIATION- The term `qualified State association'
means the industry trade association or other organization that the
qualified industry organization or the Alliance determines best represents
retail marketers in a State.
(12) RETAIL MARKETER- The term `retail marketer' means a person engaged
primarily in the sale of oilheat to ultimate consumers.
(13) SECRETARY- The term `Secretary' means the Secretary of
Energy.
(14) WHOLESALE DISTRIBUTOR- The term `wholesale distributor' means a
person that--
(A)(i) produces No. 1 distillate or No. 2 dyed distillate;
(ii) imports No. 1 distillate or No. 2 dyed distillate; or
(iii) transports No. 1 distillate or No. 2 dyed distillate across
State boundaries or among local marketing areas; and
(B) sells the distillate to another person that does not produce,
import, or transport No. 1 distillate or No. 2 dyed distillate across
State boundaries or among local marketing areas.
(15) STATE- The term `State' means the several States, except the State
of Alaska.
`SEC. 102. REFERENDA.
`(a) CREATION OF PROGRAM-
`(1) IN GENERAL- The oilheat industry, through the qualified industry
organization, may conduct, at its own expense, a referendum among retail
marketers and wholesale distributors for the establishment of a national
oilheat research alliance.
`(2) REIMBURSEMENT OF COST- The Alliance, if established, shall
reimburse the qualified industry organization for the cost of accounting and
documentation for the referendum.
`(3) CONDUCT- A referendum under paragraph (1) shall be conducted by an
independent auditing firm.
`(A) RETAIL MARKETERS- Voting rights of retail marketers in a
referendum under paragraph (1) shall be based on the volume of oilheat
sold in a State by each retail marketer in the calendar year previous to
the year in which the referendum is conducted or in another representative
period.
`(B) WHOLESALE DISTRIBUTORS- Voting rights of wholesale distributors
in a referendum under paragraph (1) shall be based on the volume of No. 1
distillate and No. 2 dyed distillate sold in a State by each wholesale
distributor in the calendar year previous to the year in which the
referendum is conducted or in another representative period, weighted by
the ratio of the total volume or No. 1 distillate and No. 2 dyed
distillate sold for nonindustrial commercial and residential space and hot
water heating in the State to the total volume of No. 1 distillate and No.
2 dyed distillate sold in that State.
`(5) ESTABLISHMENT BY APPROVAL OF TWO-THIRDS-
`(A) IN GENERAL- Subject to subparagraph (B), on approval of persons
representing two-thirds of the total volume of oilheat voted in the retail
marketer class and two-thirds of the total weighted volume of No. 1
distillate and No. 2 dyed distillate voted in the wholesale distributor
class, the Alliance shall be established and shall be authorized to levy
assessments under section 107.
`(B) REQUIREMENT OF MAJORITY OF RETAIL MARKETERS- Except as provided
in subsection (b), the oilheat industry in a State shall not participate
in the Alliance if less than 50 percent of the retail marketer vote in the
State approves establishment of the Alliance.
`(6) CERTIFICATION OF VOLUMES- Each person voting in the referendum
shall certify to the independent auditing firm the volume of oilheat, No. 1
distillate, or No. 2 dyed distillate represented by the vote of the
person.
`(7) NOTIFICATION- Not later than 90 days after the date of enactment of
this title, a qualified State association may notify the qualified industry
organization in writing that a referendum under paragraph (1) will not be
conducted in the State.
`(b) SUBSEQUENT STATE PARTICIPATION- The oilheat industry in a State that
has not participated initially in the Alliance may subsequently elect to
participate by conducting a referendum under subsection (a).
`(c) TERMINATION OR SUSPENSION-
`(1) IN GENERAL- On the initiative of the Alliance or on petition to the
Alliance by retail marketers and wholesale distributors representing 35
percent of the volume of oilheat or weighted No. 1 distillate and No. 2 dyed
distillate in each class, the Alliance shall, at its own expense, hold a
referendum, to be conducted by an independent auditing firm selected by the
Alliance, to determine whether the oilheat industry favors termination or
suspension of the Alliance.
`(2) VOLUME PERCENTAGES REQUIRED TO TERMINATE OR SUSPEND- Termination or
suspension shall not take effect unless termination or suspension is
approved by--
`(A) persons representing more than one-half of the total volume of
oilheat voted in the retail marketer class and more than one-half of the
total volume of weighted No. 1 distillate and No. 2 dyed distillate voted
in the wholesale distributor class; or
`(B) persons representing more than two-thirds of the total volume of
fuel voted in either such class.
`(d) CALCULATION OF OILHEAT SALES- For the purposes of this section and
section 105, the volume of oilheat sold annually in a State shall be
determined on the basis of information provided by the Energy Information
Administration with respect to a calendar year or other representative
period.
`SEC. 103. MEMBERSHIP.
`(1) IN GENERAL- Except as provided in subsection (c)(1)(C), the
qualified industry organization shall select members of the Alliance
representing the oilheat industry in a State from a list of nominees
submitted by the qualified State association in the State.
`(2) VACANCIES- A vacancy in the Alliance shall be filled in the same
manner as the original selection.
`(b) REPRESENTATION- In selecting members of the Alliance, the qualified
industry organization shall make best efforts to select members that are
representative of the oilheat industry, including representation of--
`(1) interstate and intrastate operators among retail marketers;
`(2) wholesale distributors of No. 1 distillate and No. 2 dyed
distillate;
`(3) large and small companies among wholesale distributors and retail
marketers; and
`(4) diverse geographic regions of the country.
`(1) IN GENERAL- The membership of the Alliance shall be as
follows:
`(A) One member representing each State with oilheat sales in excess
of 32,000,000 gallons per year.
`(B) If fewer than 24 States are represented under subparagraph (A), 1
member representing each of the States with the highest volume of annual
oilheat sales, as necessary to cause the total number of States
represented under subparagraph (A) and this subparagraph to equal
24.
`(C) 5 representatives of retail marketers, 1 each to be selected by
the qualified State associations of the 5 States with the highest volume
of annual oilheat sales.
`(D) 5 additional representatives of retail marketers.
`(E) 21 representatives of wholesale distributors.
`(F) 6 public members, who shall be representatives of significant
users of oilheat, the oilheat research community, State energy officials,
or other groups knowledgeable about oilheat.
`(2) FULL-TIME OWNERS OR EMPLOYEES- Other than the public members,
Alliance members shall be full-time owners or employees of members of the
oilheat industry, except that members described in subparagraphs (C), (D),
and (E) of paragraph (1) may be employees of the qualified industry
organization or an industry trade association.
`(d) COMPENSATION- Alliance members shall receive no compensation for
their service, nor shall Alliance members be reimbursed for expenses relating
to their service, except that public members, on request, may be reimbursed
for reasonable expenses directly related to participation in meetings of the
Alliance.
`(1) IN GENERAL- Subject to paragraph (4), a member of the Alliance
shall serve a term of 3 years, except that a member filling an unexpired
term may serve a total of 7 consecutive years.
`(2) TERM LIMIT- A member may serve not more than 2 full consecutive
terms.
`(3) FORMER MEMBERS- A former member of the Alliance may be returned to
the Alliance if the member has not been a member for a period of 2
years.
`(4) INITIAL APPOINTMENTS- Initial appointments to the Alliance shall be
for terms of 1, 2, and 3 years, as determined by the qualified industry
organization, staggered to provide for the subsequent selection of one-third
of the members each year.
`SEC. 104. FUNCTIONS.
`(1) PROGRAMS, PROJECTS; CONTRACTS AND OTHER AGREEMENTS- The
Alliance--
`(A) shall develop programs and projects and enter into contracts or
other agreements with other persons and entities for implementing this
title, including programs--
`(i) to enhance consumer and employee safety and
training;
`(ii) to provide for research development, and demonstration of
clean and efficient oilheat utilization equipment; and
`(iii) for consumer education; and
`(B) may provide for the payment of the costs of carrying out
subparagraph (A) with assessments collected under section 107.
`(2) COORDINATION- The Alliance shall coordinate its activities with
industry trade associations and other persons as appropriate to provide
efficient delivery of services and to avoid unnecessary duplication of
activities.
`(A) EXCLUSIONS- Activities under clause (i) or (ii) of paragraph
(1)(A) shall not include advertising, promotions, or consumer surveys in
support of advertising or promotions.
`(B) Research, development, and demonstration activities-
`(i) IN GENERAL- Research, development, and demonstration activities
under paragraph (1)(A)(ii) shall include--
`(I) all activities incidental to research, development, and
demonstration of clean and efficient oilheat utilization equipment;
and
`(II) the obtaining of patents, including payment of attorney's
fees for making and perfecting a patent application.
`(ii) EXCLUDED ACTIVITIES- Research, development, and demonstration
activities under paragraph (1)(A)(ii) shall not include research,
development, and demonstration of oilheat utilization equipment with
respect to which technically feasible and commercially feasible
operations have been verified, except that funds may be provided for
improvements to existing equipment until the technical feasibility and
commercial feasibility of the operation of those improvements have been
verified.
`(b) PRIORITIES- In the development of programs and projects, the Alliance
shall give priority to issues relating to--
`(1) research, development, and demonstration;
`(3) consumer education; and
`(1) OFFICERS; COMMITTEES; BYLAWS- The Alliance--
`(A) shall select from among its members a chairperson and other
officers as necessary;
`(B) may establish and authorize committees and subcommittees of the
Alliance to take specific actions that the Alliance is authorized to take;
and
`(C) shall adopt bylaws for the conduct of business and the
implementation of this title.
`(2) SOLICITATION OF OILHEAT INDUSTRY COMMENT AND RECOMMENDATIONS- The
Alliance shall establish procedures for the solicitation of oilheat industry
comment and recommendations on any significant contracts and other
agreements, programs, and projects to be funded by the Alliance.
`(4) VOTING- Each member of the Alliance shall have 1 vote in matters
before the Alliance.
`(d) ADMINISTRATIVE EXPENSES-
`(1) IN GENERAL- The administrative expenses of operating the Alliance
(not including costs incurred in the collection of assessments under section
107) plus amounts paid under paragraph (2) shall not exceed 7 percent of the
amount of assessments collected in any calendar year, except that during the
first year of operation of the Alliance such expenses and amounts shall not
exceed 10 percent of the amount of assessments.
`(2) Reimbursement of the secretary-
`(A) IN GENERAL- The Alliance shall annually reimburse the Secretary
for costs incurred by the Federal Government relating to the
Alliance.
`(B) LIMITATION- Reimbursement under subparagraph (A) for any calendar
year shall not exceed the amount that the Secretary determines is twice
the average annual salary of 1 employee of the Department of
Energy.
`(1) PUBLICATION OF PROPOSED BUDGET- Before August 1 of each year, the
Alliance shall publish for public review and comment a proposed budget for
the next calendar year, including the probable costs of all programs,
projects, and contracts and other agreements.
`(2) SUBMISSION TO THE SECRETARY AND CONGRESS- After review and comment
under paragraph (1), the Alliance shall submit the proposed budget to the
Secretary and Congress.
`(3) RECOMMENDATIONS BY THE SECRETARY- The Secretary may recommend for
inclusion in the budget programs and activities that the Secretary considers
appropriate.
`(4) IMPLEMENTATION- The Alliance shall not implement a proposed budget
until the expiration of 60 days after submitting the proposed budget to the
Secretary.
`(1) RECORDS- The Alliance shall--
`(A) keep records that clearly reflect all of the acts the
transactions of the Alliance; and
`(B) make the records available to the public.
`(A) IN GENERAL- The records of the Alliance (including fee assessment
reports and applications for refunds under section 107(b)(4)) shall be
audited by a certified public accountant at least once each year and at
such other times as the Alliance may designate.
`(B) AVAILABILITY OF AUDIT REPORTS- Copies of each audit report shall
be provided to the Secretary, the members of the Alliance, and the
qualified industry organization, and, on request to other members of the
oilheat industry.
`(C) Policies and procedures-
`(i) IN GENERAL- The Alliance shall establish policies and
procedures for auditing compliance with this title.
`(ii) CONFORMITY WITH GAAP- The policies and procedures
established under clause (i) shall conform with generally accepted
accounting principles.
`(g) PUBLIC ACCESS to ALLIANCE Proceedings-
`(1) PUBLIC NOTICE- The alliance shall give at least 30 days' public
notice of each meeting of the Alliance.
`(2) MEETINGS OPEN TO THE PUBLIC- Each meeting of the Alliance shall be
open to the public.
`(3) MINUTES- The minutes of each meeting of the Alliance shall be made
available to and readily accessible by the public.
`(h) ANNUAL REPORT- Each year the Alliance shall prepare and make publicly
available a report that--
`(1) includes a description of all programs, projects, and contracts and
other agreements undertaken by the Alliance during the previous year and
those planned for the current year; and
`(2) details the allocation of Alliance resources for each such program
and project.
`SEC. 105. ASSESSMENTS.
`(a) RATE- The assessment rate shall be equal to two-tenths-cent per
gallon of No. 1 distillate and No. 2 dyed distillate.
`(1) COLLECTION AT POINT OF SALE- The assessment shall be collected at
the point of sale of No. 1 distillate and No. 2 dyed distillate by a
wholesale distributor to a person other than a wholesale distributor,
including a sale made pursuant to an exchange.
`(2) RESPONSIBILITY FOR PAYMENT- A wholesale distributor--
`(A) shall be responsible for payment of an assessment to the Alliance
on a quarterly basis; and
`(B) shall provide to the Alliance certification of the volume of fuel
sold.
`(3) NO OWNERSHIP INTEREST- A person that has no ownership interest in
No. 1 distillate or No. 2 dyed distillate shall not be responsible for
payment of an assessment under this section.
`(4) FAILURE TO RECEIVE PAYMENT-
`(A) REFUND- A wholesale distributor that does not receive payments
from a purchaser for No. 1 distillate or No. 2 dyed distillate within 1
year of the date of sale may apply for a refund from the Alliance of the
assessment paid.
`(B) AMOUNT- The amount of a refund shall not exceed the amount of the
assessment levied on the No. 1 distillate or No. 2 dyed distillate for
which payment was not received.
`(5) IMPORTATION AFTER POINT OF SALE- The owner of No. 1 distillate or
No. 2 dyed distillate imported after the point of sale--
`(A) shall be responsible for payment of the assessment of the
Alliance at the point at which the product enters the United States;
and
`(B) shall provide to the Alliance certification of the volume of fuel
imported.
`(6) LATE PAYMENT CHARGE- The Alliance may establish a late payment
charge and rate of interest to be imposed on any person who fails to remit
or pay to the Alliance any amount due under this title.
`(7) ALTERNATIVE COLLECTION RULES- The Alliance may establish, or
approve a request of the oilheat industry in a State for, an alternative
means of collecting the assessment if another means is determined to be more
efficient or more effective.
`(c) SALE FOR USE OTHER THAN AS OILHEAT- No. 1 distillate and No. 2 dyed
distillate sold for uses other than as oilheat are excluded from the
assessment.
`(d) INVESTMENT OF FUNDS- Pending disbursement under a program, project,
or contract or other agreement the Alliance may invest funds collected through
assessments, and any other finds received by the Alliance, only--
`(1) in obligations of the United States or any agency of the United
States;
`(2) in general obligations of any State or any political subdivision of
a State;
`(3) in any interest-bearing account or certificate of deposit of a bank
that is a member of the Federal Reserve System; or
`(4) in obligations fully guaranteed as principal and interest by the
United States.
`(e) STATE, LOCAL, AND REGIONAL PROGRAMS-
`(1) COORDINATION- The Alliance shall establish a program coordinating
the operation of the Alliance with the operator of any similar State, local,
or regional program created under State law (including a regulation), or
similar entity.
`(2) FUNDS MADE AVAILABLE TO QUALIFIED STATE ASSOCIATIONS-
`(i) BASE AMOUNT- The Alliance shall make available to the qualified
State association of each State an amount equal to 15 percent of the
amount of assessments collected in the State.
`(I) IN GENERAL- A qualified State association may request that
the Alliance provide to the association any portion of the remaining
85 percent of the amount of assessments collected in the
State.
`(II) REQUEST REQUIREMENTS- A request under this clause
shall--
`(aa) specify the amount of funds requested;
`(bb) describe in detail the specific uses for which the requested
funds are sought;
`(cc) include a commitment to comply with this title in using the
requested funds; and
`(dd) be made publicly available.
`(III) DIRECT BENEFIT- The Alliance shall not provide any funds in
response to a request under this clause unless the Alliance determines
that the funds will be used to directly benefit the oilheat
industry.
`(IV) MONITORING; TERMS, CONDITIONS, AND REPORTING REQUIREMENTS-
The Alliance shall--
`(aa) monitor the use of funds provided under this clause;
and
`(bb) impose whatever terms, conditions, and reporting requirements
that the Alliance considers necessary to ensure compliance with this
title.
`SEC. 106. MARKET SURVEY AND CONSUMER PROTECTION.
`(a) PRICE ANALYSIS- Beginning 2 years after establishment of the Alliance
and annually thereafter, the Secretary of Commerce, using only data provided
by the Energy Information Administration and other public sources, shall
prepare and make available to the Congress, the Alliance, the Secretary of
Energy, and the public, an analysis of changes in the price of oilheat
relative to other energy sources. The oilheat price analysis shall compare
indexed changes in the price of consumer grade oilheat to a composite of
indexed changes in the price of residential electricity, residential natural
gas, and propane on an annual average basis. For purposes of indexing changes
in oilheat, residential electricity, residential natural gas, and propane
prices, the Secretary of Commerce shall use a 5-year rolling average price
beginning with the year 4 years prior to the establishment of the Alliance.
`(b) AUTHORITY TO RESTRICT ACTIVITIES- If in any year the 5-year average
price composite index of consumer grade oilheat exceeds the 5-year rolling
average price composite index of residential electricity, residential natural
gas, and propane in an amount greater than 10.1 percent, the activities of the
Alliance shall be restricted to research and development, training, and safety
matters. The Alliance shall inform the Secretary of Energy and the Congress of
any restriction of activities under this subsection. Upon expiration of 180
days after the beginning of any such restriction of activities, the Secretary
of Commerce shall again conduct the oilheat price analysis described in
subsection (a). Activities of the Alliance shall continue to be restricted
under this subsection until the price index excess is 10.1 percent or less.
`SEC. 107. COMPLIANCE.
`(a) IN GENERAL- The Alliance may bring a civil action in United States
district court to compel payment of an assessment under section 107.
`(b) COSTS- A successful action for compliance under this section may also
require payment by the defendant of the costs incurred by the Alliance in
bringing the action.
`SEC. 108. LOBBYING RESTRICTIONS.
`No funds derived from assessments under section 107 collected by the
Alliance shall be used to influence legislation or elections, except that the
Alliance may use such funds to formulate and submit to the Secretary
recommendations for amendments to this title or other laws that would further
the purposes of this title.
`SEC. 109. DISCLOSURE.
`Any consumer education activity undertaken with funds provided by the
Alliance shall include a statement that the activities were supported, in
whole or in part, by the Alliance.
`SEC. 110. VIOLATIONS.
`(a) PROHIBITION- It shall be unlawful for any person to conduct a
consumer education activity, undertaken with funds derived from assessments
collected by the Alliance under section 107, that includes--
`(1) a reference to a private brand name;
`(2) a false or unwarranted claim on behalf of oilheat or related
products; or
`(3) a reference with respect to the attributes or use of any competing
product.
`(1) IN GENERAL- A public utility that is aggrieved by a violation
described in subsection (a) may file a complaint with the Alliance.
`(2) TRANSMITTAL TO QUALIFIED STATE ASSOCIATION- A complaint shall be
transmitted concurrently to any qualified State association undertaking the
consumer education activity with respect to which the complaint is
made.
`(3) CESSATION OF ACTIVITIES- On receipt of a complaint under this
subsection, the Alliance, and any qualified State association undertaking
the consumer education activity with respect to which the complaint is made,
shall cease that consumer education activity until--
`(A) the complaint is withdrawn; or
`(B) a court determines that the conduct of the activity complained of
does not constitute a violation of subsection (a).
`(c) RESOLUTION BY PARTIES-
`(1) IN GENERAL- Not later than 10 days after a compliant is filed and
transmitted under subsection (b), the complaining party, the Alliance, and
any qualified State association undertaking the consumer education activity
with respect to which the compliant is made shall meet to attempt to resolve
the compliant.
`(2) WITHDRAWAL OF COMPLAINT- If the issues in dispute are resolved in
those discussions, the complaining party shall withdraw its complaint.
`(1) IN GENERAL- A public utility filing a complaint under this section,
the Alliance, a qualified State association undertaking the consumer
education activity with respect to which a complaint under this section is
made, or any person aggrieved by a violation of subsection (a) may seek
appropriate relief in United States district court.
`(2) RELIEF- A public utility filing a complaint under this section
shall be entitled to temporary and injunctive relief enjoining the consumer
education activity with respect to which a complaint under this section is
made until--
`(A) the complaint is withdrawn; or
`(B) the court has determined that what the consumer education
activity complained of does not constitute a violation of subsection
(a).
`(1) MERITORIOUS CASE- In a case in Federal court in which the court
grants a public utility injunctive relief under subsection (d), the public
utility shall be entitled to recover an attorney's fee from the Alliance and
any qualified State association undertaking the consumer education activity
with respect to which a complaint under this section is made.
`(2) NONMERITORIOUS CASE- In any case under subsection (d) in which the
court determines a complaint under subsection (b) to be frivolous and
without merit, the prevailing party shall be entitled to recover an
attorney's fee.
`(f) SAVINGS CLAUSE- Nothing in this section shall limit causes of action
brought under any other law.
`SEC. 111. SUNSET.
`This title shall cease to be effective as of the date that is 4 years
after the date on which the Alliance is established.'.
TITLE XII--ELECTRICITY
SEC. 1201. COMPREHENSIVE INDIAN ENERGY PROGRAM.
(a) Title XXVI of the Energy Policy Act of 1992 (25 U.S.C. 3501-3506) is
amended by adding after section 2606 the following new section--
`SEC. 2607. COMPREHENSIVE INDIAN ENERGY PROGRAM.
`(a) DEFINITIONS- For purposes of this section--
`(1) `Director' means the Director of the Office of Indian Energy Policy
and Programs established by section 217 of the Department of Energy
Organization Act; and
`(2) `Indian land' means--
`(A) any land within the limits of an Indian reservation, pueblo, or
ranchera;
`(B) any land not within the limits of an Indian reservation, pueblo,
or ranchera whose title on the date of enactment of this section was
held--
`(i) in trust by the United States for the benefit of an Indian
tribe,
`(ii) by an Indian tribe subject to restriction by the United States
against alienation, or
`(iii) by a dependent Indian community; and
`(C) land conveyed to an Alaska Native Corporation under the Alaska
Native Claims Settlement Act.
`(b) INDIAN ENERGY EDUCATION, PLANNING AND MANAGEMENT ASSISTANCE- (1) The
Director shall establish programs within the Office of Indian Energy Policy
and Programs to assist Indian tribes to meet their energy education, research
and development, planning, and management needs.
`(2) The Director may make grants, on a competitive basis, to an Indian
tribe for--
`(A) renewable, energy efficiency, and conservation programs;
`(B) studies and other activities supporting tribal acquisition of
energy supplies, services, and facilities; and
`(C) planning, constructing, developing, operating, maintaining, and
improving tribal electrical generation, transmission, and distribution
facilities.
`(3) The Director may develop, in consultation with Indian tribes, a
formula for making grants under this section. The formula may take into
account the following--
`(A) total number of acres of Indian land owned by an Indian
tribe;
`(B) total number of households on the tribe's Indian land;
`(C) total number of households on the Indian tribe's Indian land that
have no electricity service or are underserved; and
`(D) financial or other assets available to the tribe from any
source.
`(4) In making a grant under paragraph (2)(E), the Director shall give
priority to an application received from an Indian tribe that is not served or
served inadequately by an electric utility, as that term is defined in section
3(4) of the Public Utility Regulatory Policies Act of 1978 (16 U.S.C.
2602(4)), or by a person, State agency, or any other non-federal entity that
owns or operates a local distribution facility used for the sale of electric
energy to an electric consumer.
`(5) There are authorized to be appropriated to the Department of Energy
such sums as may be necessary to carry out the purposes of this section.
`(c) APPLICATION OF BUY INDIAN ACT- (1) An agency or department of the
United States Government may give, in the purchase and sale of electricity,
oil, gas, coal, or other energy product or by-product produced, converted, or
transferred on Indian lands, preference, under section 23 of the Act of June
25, 1910 (25 U.S.C. 47) (commonly known as the `Buy Indian Act'), to an energy
and resource production enterprise, partnership, corporation, or other type of
business organization majority or wholly owned and controlled by an Indian, a
tribal government, or a business, enterprise, or operation of the American
Indian Tribal Governments.
`(2) In implementing this subsection, an agency or department shall pay no
more for energy production than the prevailing market price and shall obtain
no less than existing market terms and conditions.
`(d) This section does not--
`(1) limit the discretion vested in an Administrator of a Federal Power
Administration to market and allocate Federal power, or
`(2) alter Federal laws under which a Federal Power Administration
markets, allocates, or purchases power.'.
(b) OFFICE OF INDIAN POLICY AND PROGRAMS- Title II of the Department of
Energy Organization Act is amended by inserting the following after section
216:
`OFFICE OF INDIAN ENERGY POLICY AND PROGRAMS
`SEC. 217. (a) There is established within the Department an Office of
Indian Energy Policy and Programs. This Office shall be headed by a Director,
who shall be appointed by the Secretary and compensated at the rate equal to
that of level IV of the Executive Schedule under section 5315 of Title 5,
United States Code. The Director shall perform the duties assigned the
Director under the Comprehensive Indian Energy Act and this section.
`(b) The Director shall provide, direct, foster, coordinate, and implement
energy planning, education, management, conservation, and delivery programs of
the Department that--
`(1) promote tribal energy efficiency and utilization;
`(2) modernize and develop, for the benefit of Indian tribes, tribal
energy and economic infrastructure related to natural resource development
and electrification;
`(3) preserve and promote tribal sovereignty and self determination
related to energy matters and energy deregulation;
`(4) lower or stabilize energy costs; and
`(5) electrify tribal members' homes and tribal lands.
`(c) The Director shall carry out the duties assigned the Secretary under
title XXVI of the Energy Policy Act of 1992 (25 U.S.C. 3501 et seq.).'.
(c) CONFORMING AMENDMENT- Section 2603(c) of the Energy Policy Act of 1992
(25 U.S.C. 3503(c)) is amended to read as follows:
`(c) There are authorized to be appropriated such sums as may be necessary
to carry out the purposes of this section.'.
(d) The Table of Contents of the Department of Energy Act is amended by
inserting after the item relating to section 216 the following new item:
`217. Office of Indian Energy Policy and Programs.'.
(e) Section 5315 of title 5, United States Code, is amended by inserting
`Director, Office of Indian Energy Policy and Programs, Department of Energy.'
after `Director, Office of Science, Department of Energy.'.
SEC. 1202. INTERCONNECTION.
Title II of the Federal Power Act is further amended by adding after
section 210 (16 U.S.C. 824i) the following:
`SEC. 210A. INTERCONNECTION OF DISTRIBUTED GENERATION FACILITIES.
`(a) RULEMAKING AUTHORITY- Not later than one year after the date of
enactment of this section, the Commission shall adopt rules to ensure the
interconnection of distributed generation facilities to local distribution
facilities of an electric utility.
`(b) INTERCONNECTION AUTHORITY- Upon the application of the owner or
operator of a distributed generation facility, the Commission may issue an
order requiring the physical connection of the local distribution facilities
of an electric utility with the distributed generation facility of the
applicant.
`(c) STATE AUTHORITY- Any interconnection ordered under this section shall
be subject to regulation by the appropriate State commission.
`(d) DEFINITION- As used in this section, the term `distributed generation
facility' means--
`(1) a small-scale electric power generation facility that is designed
to serve customers at or near the facility, or
`(2) a facility using a single fuel source to produce at the point of
use either electric or mechanical power and thermal energy.'.
END